Federal Reserve Bulletin, 1975-11

NOVEMBER 1975 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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FEDERAL RESERVE BULLETIN NUMBER 11 • VOLUME 61 • NOVEMBER 1975 CONTENTS 711 Housing Construction and A 1 Financial and Business Statistics Residential Mortgage Markets A 1 Contents 721 MINNIE: A Small Version of the A 2 U.S. Statistics MIT-PENN-SSRC Econometric Model A 58 International Statistics 728 Statements to Congress A 76 Board of Governors and Staff 755 Record of Policy Actions of the Federal A 78 Open Market Committee and Staff; Open Market Committee Federal Advisory Council 762 Law Department A 79 Federal Reserve Banks and Branches 823 Announcements A 80 Federal Reserve Board Publications 827 Industrial Production A 82 Index to Statistical Tables A 84 Map of Federal Reserve System Inside Back Cover: Guide to Tabular Presentation Statistical Releases: Reference PUBLICATIONS COMMITTEE J. Charles Partee Lyle E. Gramley John M. Denkler Frederic Solomon Ralph C. Bryant Joseph R. Coyne John D. Hawke, Jr. James L. Kichline, Staff Director The Federal Reserve BULLETIN is issued monthly under the direction of the staff publications committee. This committee is responsible for opinions expressed except in official statements and signed articles. Direction for the art work is provided by Mack R. Rowe. Editorial support is furnished by the Economic Editing Unit headed by Elizabeth B. Sette. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Housing Construction and Residential Mortgage Markets This article was prepared in the Mortgage and CHART 1 Consumer Finance Section of the Division of Savings Hows and Research and Statistics. residential mortgage commitments Ratio scale, billions of dollars Private housing starts continued to advance in early autumn from the very low rate reached last winter. Single-family starts, while still short of earlier peaks, led the rise. Starts of units for rent or sale in multifamily structures, which had experienced by far the sharper decline, have begun to share in the recovery. Although flows of consumer-type savings to thrift institutions slowed in the third quarter— Net savings reflecting the ending of tax-rebate distributions inflows and the attractive yields on market securities— they were close to the record levels reached during the first half of 1975 (Chart 1). Recently, such flows have stabilized as competitive pressures on thrift institutions have eased. Mean- "Net savings inflows" are quarterly averages for savings while, lenders' liquidity positions, built up in and loan associations and mutual savings banks at seasonally adjusted annual rates. "Mortgage commitments outstanding," anticipation of some decline in flows, were which are mainly residential, are seasonally adjusted end-ofgenerally much stronger than they had been at quarter totals for all savings and loan associations and for New York mutual savings banks. Commitments data include loans the beginning of the year. in process. Latest data, Q3, preliminary. Expansion of mortgage credit has increased appreciably in 1975, due in part to an excep- Under terms of the Emergency Housing Act of tionally large number of transactions in existing 1975—passed in July—this appropriation will, homes and higher prices. Mortgage lenders, still at the administration's discretion, supplement suffering from the excesses of the previous the $7.75 billion of mortgage purchasing auboom, have been extremely cautious in the thority provided under the Emergency Home market for construction loans, but in general Purchase Assistance Act of October 1974; the they have increased their new and outstanding last portion—$2 billion—of that authority had commitments for residential mortgages to levels been released for commitment just before midwell above earlier lows. year. The GNMA program is designed essen- To help to sustain the recovery in private tially to provide residential mortgages at belowhousing starts, the Congress in October appro- market interest rates, and the ultimate cost to priated half of the $10 billion authorized for use the Treasury is determined by the loss actually by the Government National Mortgage Associ- absorbed by GNMA on resale of the mortgages ation in its tandem program to purchase con- at prevailing market prices. ventional and/or Government-underwritten resi- To provide further assistance, the Secretary dential mortgages at above-market prices. of Housing and Urban Development recently Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

712 Federal Reserve Bulletin • November 1975 announced a revised version of the home mort- into closer alignment with current market prices gage interest rate subsidy program intended for homes. For example, under the Veterans specifically for low- and moderate-income Housing Act passed toward the end of 1974 the households. This program, which in another loan-guarantee limit was raised to $17,500 from form had been suspended in early 1973, is $12,500. This legislation also made all veterans expected to be in operation well before spring with military service since the beginning of and to cover up to 250,000 new or substantially World War II permanently eligible under certain rehabilitated dwelling units over the next 2 conditions for loans guaranteed by the Veterans years. Administration. Effective this summer, FNMA raised its maximum loan limits to $42,000 from $40,000 for secondary market purchases of INSTITUTIONAL conventional mortgages and to $70,000 for purchases of VA-guaranteed mortgages. Also, in AND RELATED ADJUSTMENTS the case of FHA Title I loans for mobile homes, During the year, a number of additional legisla- the Congress recently endorsed legislation to tive and other changes have been instituted in raise the ceiling loan amounts to $12,500 from an attempt to meet current and ongoing prob- $10,000 for "single-wide" units and to $20,000 lems in the markets for housing and residential from $15,000 for " double-wides." mortgages. Most notably, last March the Con- In the rapidly evolving secondary market for gress provided—as part of the Emergency Tax conventional mortgages, a number of other Reduction Act—for tax credits ranging up to changes of particular significance were instituted $2,000 to eligible new-home buyers. Such during the year. These included the distribution credits, which were designed to help reduce the for use by lenders of the first truly uniform set exceptionally large overhang of units still in of conventional mortgage documents—standard builders' inventories at the time, are subject to within each State—under the aegis of FNMA the conditions that the purchases be only for and the Federal Home Loan Mortgage Corporasuch units, for owner occupancy, and made tion. Further steps were also taken in the develbefore the end of the year. opment of mortgage-backed securities by In the Emergency Housing Act of 1975, the FHLMC and the Federal Home Loan Bank Congress also broadened the coverage of loans Board. eligible for the GNMA-tandem purchase pro- In addition, the Chicago Board of Trade last gram to include conventional mortgages on October instituted the first centralized market for multifamily rental structures, cooperative apart- trading in mortgage futures contracts—in units ments, and individual condominiums. Along a of $100,000 of GNMA-guaranteed certificates similar tack, the Federal National Mortgage based on mortgage pools. This market offers Association in early autumn initiated a commit- the potential for mortgage originators, investors, ment and purchase program for project mort- and builders to hedge against risks of change gages insured under a new section of the Na- in interest rates that they might otherwise have tional Housing Act as amended in August 1974. to absorb. This section permits the Federal Housing Administration for the first time to underwrite credit to refinance existing multifamily projects NEW RESIDENTIAL that do not require substantial rehabilitation. CONSTRUCTION Under present circumstances, this section has been interpreted to include multifamily projects Early this autumn the seasonally adjusted annual started before mid-1974 and completed during rate of total private housing starts was still quite 1975. low, especially by the standards set in other Further efforts were made during the year to recent years. In fact, it was only slightly above bring regulatory and/or statutory loan ceilings the pace—1.24 million units—that had marked Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Housing Construction and Residential Mortgage Markets 713 the end of the previous downturn in early 1970 CHART 3 (Chart 2). Even so, the rate in September and Value of new residential construction for the third quarter as a whole was as much as a fourth above the low reached in the first Ratio scale, billions of dollars quarter of the year, and in October the starts rate advanced sharply further. CHART 2 Private housing starts and completions Ratio scale, millions of units Census data on value of new construction put in place at Mobile home shipments seasonally adjusted annual rates. "Additions and alterations" derived by F.R. from other Census series. Recent data, preliminary. SECTORAL DIFFERENCES IN HOUSING STARTS In marked contrast to multifamily starts, starts of single-family units in the 1973-74 downturn never dropped under their 1970 low (Chart 2). Census data for private housing starts and completions and Single-family starts over the first 9 months of Mobile Home Manufacturers Association data for domestic shipments of new mobile homes, converted to seasonally 1975 accounted for more than three-fourths of adjusted annual rates by Census and to quarterly averages by the total, compared with less than 60 per cent F.R. "Multifamily" includes 2 or more units. Latest data, Q3, preliminary. during the period from 1968 through 1973. The greater concentration in single-family Outlays for new private residential con- starts this year has been due to a number of struction, which lag starts, have moved upward factors. These have included the broad support in recent months after having leveled off earlier from the GNMA-tandem plan and other proin the year (Chart 3). While the value of work grams for such housing, and the relatively put in place for hotels, motels, and related smaller degree of overbuilding during the earlier nonhousekeeping units—which are also in- boom. cluded in residential construction—has re- The sluggishness in multifamily starts this mained quite low, expenditures for additions year, relative to single-family starts, has also and alterations to residential structures have reflected the fact that completed multifamily held at an advanced rate. Despite some decline structures, which require a much longer produring the third quarter of the year, such ex- duction period than do single-family units, had penditures continued to account for more than until recently continued to reach the market in a fifth of total residential construction outlays. comparatively large numbers. In addition, in- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

714 Federal Reserve Bulletin • November 1975 terest in apartment building on the part of both CHART 4 potential investors and lenders has been consid- FH A-VA share of total starts erably dampened by much weaker demands to int purchase condominiums and by difficulties of 40 achieving rent levels sufficient to cover the rising costs of maintenance and other operations, as well as construction. Concern about the timing and nature of tax 20 revision measures under consideration by the Congress has also had a limiting influence on apartment building, particularly with respect to the continuing ability of investors to use accel- 0 erated depreciation on real estate as write-offs against other types of income. Finally, while the demographic potential for new household Based on data from Census for private housing starts and from HUD and VA for units started under FHA or VA formation remains quite strong, unemployment, inspection. First 9 months 1975, preliminary. particularly among the young, has thus far been much higher than in any other period since ernment-underwritten programs accounted for World War II. As a result, growth in single- about a sixth of total private starts in the first person households—an important source of 9 months of 1975 (Chart 4). This compared with rental demand—has apparently been curtailed. 13 per cent in all of 1974 and the recent low In the market for homeowner properties, as of 12 per cent in 1973, when the administrative for other types of units, increased attention has moratorium on subsidized starts under certain been focused on the rehabilitiation of older units of the major FHA-insured programs was instiin lieu of new construction. Also moratoria on tuted. development of sewerage and related services have remained a constrictive influence on new MOBILE HOMES construction of all types. However, with the inflation-hedge potential of homeownership still Factory shipments of new mobile homes for a strong attraction for families able to meet domestic use also showed some recovery in the prevailing interest and other costs, sales of both third quarter of this year. But the seasonally new and—in particular—existing houses have adjusted annual rate of such shipments—at only improved this year. In some cases builders have 225,000—remained one of the lowest since the begun to provide basic houses with fewer rooms mid-1960's. Prices of new mobile home units, and other amenities in an effort to broaden the although still not high by conventional housing market for new homes further. standards, have advanced further this year Considered regionally, private housing starts owing to such factors as rising costs of materials in the third quarter rose in all major sections and labor and increased emphasis on upgraded of the country, including the South where earlier construction. In addition, availability of sites for overbuilding had been most pronounced and mobile home parks has remained a problem, and unsold inventories, particularly of condomin- financing generally has become more expensive, iums, still are a problem. In 1972 and 1973 in part because of a high level of repossessions. starts in the South had accounted for well over two-fifths of the national total. In the third CONSTRUCTION COSTS quarter of 1975 the share was less than two- AND HOME PRICES fifths. For the North Central States the proportion was 26 per cent, and for the West and Residential construction costs have also contin- Northeast, 23 and 13 per cent, respectively. ued to rise, but at a much more moderate pace Owing in part to some strengthening in VA- than in other recent years. This autumn, acguaranteed loan activity, starts under all Gov- cording to a widely used index, labor and mate- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Housing Construction and Residential Mortgage Markets 715 rials costs to home builders approximated 187 what. Prices of building materials, which had per cent of the 1967 average. On a year-to-year mounted sharply further in 1974, have also basis, the increase in this cost index exceeded advanced more slowly this year on the average. 5 per cent, compared with 8 per cent for 1974 The median price quoted on single-family as a whole and as much as 10 per cent in 1972. units sold by merchant builders in September With unemployment in residential construction was $39,400—more than $3,000 higher than a particularly high, wage settlements for con- year earlier. Allowing for changes in the mix struction workers have been relatively moderate of new homes sold in terms of size and other this year even though monitorship of such in- characteristics, unit prices on the average during creases under the Construction Industry Stabili- the third quarter of 1975 were running about zation Committee had expired in April 1974 7 per cent above a year earlier—noticeably less with the end of wage and price controls. Land than the record annual increases in 1973 and costs generally have continued to rise in 1975, 1974, respectively (Chart 5). but the uptrend has apparently slowed some- For existing homes the median sales price in September was $35,760, according to the National Association of Realtors. As in other re- CHART 5 cent months, such prices, which are not adjusted Housing market indexes for compositional changes, were a tenth above a year earlier. This increase was about the same Ratio scale, 1970=100 as the average for 1974. Average rents for all types of residential units have also risen, though by less than the increase in operating costs experienced in recent years. However, with the rate of completions now quite low, median rents asked for new nonsubsidized apartments coming on the market have begun to advance appreciably. Through most of 1974 such rents had remained virtually stable. MARKET ABSORPTION RATES Demand for new apartment units was relatively weak in the second quarter, the latest period for which data are available. Altogether, by the end of that quarter only 61 per cent of new privately financed, nonsubsidized apartment units intended for rental use and completed in the first quarter had been leased. This ratio contrasted with 67 per cent for similar units at the same marketing stage a year earlier and was the lowest absorption ratio for any comparable period since 1972 when the volume of comple- 1969 1971 1973 1975 tions had been markedly higher. Price index for new homes is Census quarterly index based On the other hand, for the combined total of on fixed proportions of 8 characteristics of new one-family all types of both existing and new rental units houses sold by merchant builders. Transactions prices from available for occupancy, vacancy rates this year which the index is derived include value of the developed lot, direct and indirect selling expenses, and profits. have remained near the recent highs reached Merchant builders' sales of new homes based on Census earlier (Chart 6). In part, this has continued to monthly data; and existing home sales based on monthly index of the National Association of Realtors, both at seasonally reflect additions to the "for rent" category of adjusted rates. All series converted to quarterly indexes—1970 = 100—by F.R. Latest data, Q3, preliminary. condominiums and other units originally innM'Vt ' - Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

716 Federal Reserve Bulletin • November 1975 tended for owner occupancy. In the third quarter CHART 7 the rental vacancy rate was 6.2 per cent, far Private dwelling units below the high of 8.4 per cent reached in the same period of 1964, but still well above the Ratio scale, millions of units 5.3 per cent rate in the third quarter of 1970. Average vacancy rates for homeowner properties, which had changed little in the first half of the year, rose in the third quarter—to 1.4 per cent. Even so, the average remained significantly below the record high in the third quarter of 1963, both nationally and for most census regions. CHART 6 1971 1973 1975 1971 1973 1975 Residential vacancy rates Census data, with completions at seasonally adjusted annual rates converted to quarterly averages by F.R. Units under Per cent construction are end-of-quarter totals seasonally adjusted by F.R. All data exclude mobile homes. Latest data, Q3, preliminary. RESIDENTIAL MORTGAGE MARKETS Commitments outstanding at thrift institutions to make or acquire mortgages reached a 2-year high in August and rose further in September. While both short- and long-term interest rates had turned up during the summer, yields Census quarterly data. Vacancy rates relate to vacant dwell- on market securities generally have eased during ings available for rent or sale. Latest data, Q3. October and early November. As a result, up- Meanwhile, the strain on the resources of ward pressures on mortgage yields—more than residential builders has eased somewhat. For usually sensitive to general market developexample, merchant builders' sales of single- ments in recent years—have also moderated, family homes, which exclude most condomin- and secondary market support activity from iums, were holding only a little below the FNMA, FHLMC, and other nondepositary improved second-quarter rate despite further sources has lessened. price increases, the dwindling number of units Lenders still hold a large volume of unseanow eligible for tax rebates, and more competi- soned mortgages on both single-family and tion from record sales of existing homes (Chart multifamily units, and with unemployment rates 5). By the end of the third quarter, merchant still very high, mortgage lending policies have builders' stocks of new homes for sale at all remained quite selective this year. Even so, stages of construction were still comparatively delinquency rates did not rise during the general high. However, they equaled just over 8 recession as much as had been feared. In fact, months' supply at current sales rates, compared by the second quarter, seasonally adjusted dewith nearly 12 months' supply at the end of linquency rates on permanent home mortgages 1974. The adjustment for multifamily units has held by institutions that report to the Mortgage been even more striking. By the third quarter, Bankers Association had declined to 4.37 per both units under construction and completions cent from a recent high of 4.52 per cent in the in the multifamily sector were running at or first quarter and were little changed from the below their lows in early 1970 (Chart 7). average for April-June 1974. Moreover, due in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Housing Construction and Residential Mortgage Markets 717 part to Government requests for forbearance, basis points under the record high registered in outright foreclosures remained quite low. September 1974 (Chart 8). Interest rates for Meanwhile, problems involved in working out conventional loans on existing homes tend to overdue residential construction loans, particu- exhibit much the same pattern of movement as larly by the real estate investment trusts, con- those for new homes; in October they averaged tinued to be a factor limiting further lending in 9.30 per cent and were also unchanged from this critical area. September, according to reports from the Department of Housing and Urban Development. With bond yields down sharply in Oc- HOME MORTGAGE TERMS tober, the gross yield differential in favor of Contract interest rates for new commitments on home mortgages as against corporate bonds conventional first mortgages on new homes re- turned slightly positive for the first month since mained at the 9.25 per cent average reached in last February. The differential, which is in- September. This was about 35 basis points fluenced in part by relatively low usury ceiling above the low of last March but still some 55 rates in some States and which had been nega- CHART 8 Yields on home mortgages and bonds Mortgage data based on HUD (FHA) field-office reports. For by adjustment in contract interest rate except in some cases "conventional," average interest rates are for first mortgages where estimates have been provided by F.R. For corporate on new homes. For "FHA-insured," weighted averages of bonds, average of yields on new issues (Moody's Aaa, Aa, private secondary market bid prices for certain new-home and A adjusted to Aaa utility bonds with 5-year call protection). mortgages (shown at a discount from par in the bottom panel) Yield spread is for conventional mortgages. Latest data, Sepconverted to annual yield; thin lines indicate months affected tember. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

718 Federal Reserve Bulletin • November 1975 tive during most of the past 2 years, is an CHART 10 important consideration to diversified lenders Conventional home mortgage terms especially because of the higher servicing and related costs mortgage investments involve. Per cent The relatively prompt upturn in home mortgage rates this August and September was partly in response to a long-anticipated slackening that occurred in net savings flows to thrift institutions from the record levels reached earlier in the year. Even so, with the liquidity positions of such institutions greatly improved, outstanding mortgage commitments continued to rise in September. By the end of October, mortgage funds at savings and loans were indicated to be in short supply relative to demand in only a few Federal home loan bank districts. In the private secondary market for Government-underwritten mortgages, the upturn in 1971 1973 1975 yields this summer and early autumn was fairly Monthly data from FHLBB, with cooperation of FDIC, are sharp. In October, however, such yields refor conventional first mortgages at time of closing by major versed direction and declined to an average of lender groups on single-family homes for purchase only. Data beginning 1973 are not strictly comparable with those for 9.53 per cent (on 9 per cent mortgages purearlier years because of sampling and other changes. Latest chased for immediate delivery); this was still data, September, preliminary. considerably below the record high of 10.38 per cent in September 1974—and no more than 47 basis points above the low reached last June CHART 9 (when the regulatory maximum on such mortgages had been SV2 per cent). Discounts on such FN MA purchase auction results: FHA-VA mortgages averaged 4 points in October, a level Per cent per annum more favorable to market participants than in other recent months. In FNMA's free-market auctions of forward commitments to purchase eligible FHA-VA Billions of dollars home mortgages, average yields on bids accepted by FNMA had moved almost to the 10 per cent level by early October (Chart 9). Thereafter, however, they receded appreciably as the volume of offerings to FNMA dwindled to levels well below their earlier accelerated pace. A factor in this development was the more attractive prices recently available in the market for GNMA-guaranteed "pass-through" securities backed by pools of FHA-VA mortgages. By early November in the related auction for commitments to buy conventional mortgages, Data from FNMA based on results of generally biweekly the average yield on bids accepted by FNMA— auctions for Government-underwritten mortgages. Yields to FNMA shown are for 4-month forward-purchase commitments 9.54 per cent—was also running below the high (assuming a 12-year prepayment period for certain 30-year in early October. So too were yields asked by Government-underwritten mortgages) and are gross before deduction of mortgage servicing fee, without allowance for FHLMC on comparable nonsubsidized mortcommitment fee and required purchase of FNMA stock. Latest gage purchases. data, Nov. 3, 1975, auction. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Housing Construction and Residential Mortgage Markets 719 While loan/price terms on conventional first amounts in most other recent years when home mortgages closed on single-family homes— prices had been appreciably lower. under commitments made some months ear- Including the third quarter, as much as lier—have remained more stringent than in 1973 seven-eighths of all of the net increase in resi- (Chart 10), they have generally been liberalized dential mortgage debt outstanding this year has during 1975. Reflecting this shift and the con- been on single-family properties. This has retinuing rise in average prices of homes sold, flected in part the sharply reduced level of average loan amounts have recently reached construction lending on multifamily properties new highs. Average maturities associated with by REIT's and by other lenders specializing in such mortgages have also tended to ease, off- such loans, as well as the dwindling number setting to some extent the effect of higher con- of completed apartment properties now requirtract interest rates on monthly mortgage pay- ing permanent financing. Also transactions in ments. existing homes this year have been extremely numerous and in most cases they have required larger amounts of financing under prevailing DEBT EXPANSION inflationary conditions. Seasonally adjusted net acquisition of debt se- Among the major lender groups, savings and cured by residential properties has expanded loan associations in the first three quarters of further during the third quarter of 1975 from the year accounted for more than three-fifths of the low reached in the fourth quarter of 1974 the net increase in mortgage debt outstanding (Chart 11). The annual rate of about $44 billion on single-family and multifamily properties in the third quarter was already only about a combined. Even so, savings and loan associatenth below the record pace of net accumulation tions also managed to repay a substantial in 1973. In that year the net increase in total amount of debt to the Federal home loan banks residential mortgage holdings by all lenders had and to rebuild liquidity during the first half of approximated $50 billion as compared with less the year. than $20 billion in all of 1970 and even smaller In the first three quarters of the year, net CHART 11 Net change in residential mortgage debt Ratio scale, billions of dollars Per cent LENDER SHARE 6 100 BY TYPE OF STRUCTURE Other I Including j life insurance companies ; Commercial 20 banksw I mi hi H m m* Mutual savings j banks 10 Savings and 4 loans Quarterly data by type of property estimated—and converted Distribution of net changes by type of holder based on annual to seasonally adjusted annual rates—by F.R. as required to totals except first three quarters of 1975. Latest data, prelimisupplement reports of Federal agencies and private sources. nary. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

720 Federal Reserve Bulletin • November 1975 acquisition of residential mortgage debt by quisition by mutual savings banks also remained commercial banks, which had already dwindled relatively limited, as did that by life insurance considerably since 1973, continued to run at the companies. slowest pace since 1970. This development was Among other mortgage lenders, net purchases associated with sluggishness in all forms of bank by FNMA and other Federally sponsored mortlending related to real estate, including loans gage credit agencies moved upward in the third to mortgage companies, and it reflected—par- quarter. In addition, the dollar amount of mortticularly in the case of large banks—loans still gages in the pools backing issues of GNMAoutstanding to the REIT's. A number of REIT's guaranteed "pass-through" securities has conare still operating under special support ar- tinued to grow. By the end of September it rangements designed to work out problems re- exceeded $17 billion, an expansion of $6 billion sulting from earlier excesses. Net mortgage ac- from a year earlier. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

721 Staff Economic Study From time to time the Federal Reserve BUL- are responsible for the analyses and conclusions LETIN publishes in full staff studies that are set forth, and the views expressed do not necesof general interest to the economics profession sarily indicate concurrence by the Board of and to others. Governors, the Federal Reserve Banks, or As in all staff economic studies, the authors members of their staffs. MINNIE: A Small Version of the MIT-PENN-SSRC Econometric Model DOUGLAS BATTENBERG, JARED ENZLER, AND ARTHUR HAVENNER—Staff, Board of Governors The optimal size of an econometric model varies fied. A considerably more elaborate description with its use. Since simulation with even very of financial flows including time and savings large, nonlinear macroeconomic models is in- deposits, mortgage stocks and flows, and the expensive today, there has been little incentive relation of these items to residential construction to keep models small, even if the refinements has been incorporated. have only marginal effects. On the other hand, There have, of course, been a number of when these models are applied to other pur- other, less important changes. MINNIE is a poses, the cost of minor refinements is often condensation of a recent version of the MPS excessive and a different trade-off between ac- model and incorporates most of the later develcuracy and complexity is necessary. opments.3 MINNIE retains the key structural This paper describes MINNIE—a condensed relations (those determining consumption, duversion of the Massachusetts Institute of Tech- rable investment, prices, and so on) in the exact nology-University of Pennsylvania-Social Sci- form in which they appear in the MPS model, ence Research Council (MPS) econometric while it simplifies the relations that introduce model.1 Very early versions of the full MPS a great deal of complexity to achieve only minor model were described several years ago in the gains (the four import functions, the mortgage Federal Reserve BULLETIN.2 The model has sector, and so forth). MINNIE has 149 stochassince undergone substantial changes. Most of tic coefficients and 21 equations—about a third the expenditure equations have been made to of the number of the large model—while the depend on real interest rates rather than on set of policy instruments and the short-run dynominal rates. The labor sector and the calcula- namic responses are nearly the same. tion of income distribution have been re-speci- Three basic procedures were used to collapse the large model to MINNIE. First, extreme 1This report does not evaluate the MPS model— MINNIE is intended to duplicate the responses of the large model, not to be an alternative to it. 2 See "The Federal Reserve-MIT Econometric 3 The staff at the Federal Reserve uses a modified Model" in the BULLETIN, Jan. 1968, p. 11, and "The version of the MPS model in some of its work. This Channels of Monetary Policy" in the BULLETIN, June modified version has somewhat different properties than 1969, p. 472. does either the standard MPS model or MINNIE. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

722 Federal Reserve Bulletin • November 1975 fine-tuning of variables was eliminated. For FINAL DEMANDS SECTOR example, the credit rationing term in the housing equation was changed to eliminate the need for The first equations determine real consumption the elaborate time deposit and mortgage sectors expenditures. The per capita consumption equaof the large model. Second, we have combined tion5 is the same as that of the large model, some of the variables, which provide interesting while the consumer durable goods investment detail but are not essential to the functioning function required several modifications. In the of the model, as by the aggregation of the MPS model it is a stock adjustment equation variables for single- and multifamily housing in which the current period's investment (JBCD) starts. Both of these simplifications have re- depends negatively on last period's stock, nequired new estimation of the parameters of these gatively on the implicit rental rate of consumer equations. durable goods, and positively on current real disposable income (YD) and single-family The third technique for collapsing the large housing starts. MINNIE substitutes total housmodel primarily applies to the tax and income ing starts because they will not be disaggregated sectors, where the desired long-run properties in the housing sector and makes a few changes of the MPS model have resulted in variables in the rental rate expression: (1) a new conthat are stable in the short run. For instance, struct, PDOTX,6 has been introduced as a price the after-tax cash flow of corporations depends expectations variable; (2) the expectations comon depreciation of producers' durable equipment ponent of the rental rate operates only after 1966 and structures—a separate equation for each— in the MPS model but over the entire sample the price deflator for housing, the stock of in MINNIE; and (3) a relative price term in the single- and multifamily houses, and assorted large model has been dropped from MINNIE minor variables in the large model. In MINNIE, because it introduces a nonlinearity but does not these variables have all been replaced by a exhibit much short-run variation. The remaining varying proportion of gross national product, four equations determining consumer goods dewhich is a variable, not a parameter, so the preciation, the stock of consumer goods, their equation is an identity. In the short run this net imputed rent, and personal consumption variable changes hardly at all and may justifiexpenditures close the consumption block and ably be assumed constant; minor short-term are exactly the same as in the MPS model. feedbacks have been eliminated. A block of three equations7 in the large model has been aggregated into one equation for State DIFFERENCES FROM and local government expenditures. Besides the assumptions about constant "mix," this equa- THE MPS MODEL tion also requires that State and local employ- The theory underlying each sector of the MPS ment be exogenous, since employee compensamodel has been developed in a number of tion is no longer separately available to estimate working papers available on request (see list, the number of State and local workers. As State page 727) and will not be reiterated here; this and local employment is extremely insensitive section is primarily concerned with the dif- in the short run, it should not be a serious ferences between the two models. An appendix omission. containing the list of equations and an alphabet- Four MPS equations disaggregate the quantity ical list of variables is available on request in of real imports by merchandise and by services mimeographed form.4 5 Defined as expenditures on nondurable goods and services plus the value of services from consumer durable goods. 4Requests should be addressed to: Publications Serv- 6Defined as a distributed lag on nonfarm business ices, Division of Administrative Services, Board of product. Governors of the Federal Reserve System, Washington, 7Construction expenditures, other goods, and em- D.C. 20551. ployee compensation. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MINNIE: A Small Version of the MIT-PENN-SSRC Econometric Model 723 and by Canada and by the rest of the world. Nonfarm business inventory determination is MINNIE replaces these with a functional form the same as in the MPS model. similar to that of the MPS equation for mer- The last category of demand to consider is chandise from the world other than Canada, the housing sector—residential structures. The which represents the largest portion of imports.8 real value of housing starts (HS) depends on Three equations determine investment in pro- the profitability of building houses, and this in ducers' durable equipment. The first, orders, is turn depends on the ratio of the price of houses the key relationship in the producers' durable (PH) to construction costs (PHC): equipment sector. It is of the form: A.l HS = f (PH/PHC) OPD = VPD x AXBe Housing services are assumed to be proportional where VPD is the equilibrium ratio of produc- to the housing stock, and the demand for housers' durable goods to output, and AXBe is the ing services depends positively on permanent desired addition to capacity—represented by a income—represented here by CON—and negadistributed lag on business output (XB). VPD, tively on the price of housing services (RH): however, is not observable, and in the large A.2 KH = g (CON, RH/PCON) model the equations for OPD and VPD are Finally, the price of houses (PH) is assumed jointly estimated as one nonlinear equation to be equal to the capitalized value of the rental [Bischoff, 11], a process that allows the estima- price of housing services. tion of the relative weights on the corporate A.3 PH = RH/RCH bond rate and the dividend/price ratio in the cost where RCH is the cost of capital. Solving A.2 of capital. Given these two weights, VPD is for RH and substituting into A.3, and substitutobservable; the procedure followed for MINNIE ing the resulting expression into A.l gives was to accept these two weights as given and HS = h(CON, KH, RCH, PHC, PCON) regress the now observable VPD on its major which is the basis of the housing stock equation determinants. (The resulting equation is not an in MINNIE, subject to two modifications. First, identity because the functional form of the re- the mortgage rate has been replaced by the gression is far simpler than the identities it corporate bond rate in the cost of capital, and replaces and because some of the less important second, a credit rationing term has been added. determinants of VPD have been omitted.) The Since changes in deposit flows to thrift instituexpenditures, unfilled orders, and production tions do not result in an immediate change in capacity equations that close the sector are mortgage rates sufficient to clear the market, the identical to their MPS counterparts. MPS model incorporates the rate of change of Two producers' structures equations corre- outstanding mortgage commitments in the spond to the first two equations determining housing equations. With the deposit and mortinvestment in producers' durable goods. The gage sectors omitted from MINNIE, we must first, analogous to the orders equation above, use another variable. Mortgage commitments is the important producers' structures expendi- depend on deposit flows, and deposit flows ture (EPS) equation taken exactly from the large depend on the relationship of market interest model. Similarly, the equilibrium ratio of pro- rates to rates paid on thrift deposits. We have ducers' structures to output (VPS) is made ob- used as a credit rationing variable the logarithm servable by assumption so that a regression on of the ratio of the Treasury bill rate to the ceiling business output replaces a number of highly rate on commercial bank time deposits (In nonlinear identities. The stock of producers' RTB/ZCT).9 The remaining equations, deterstructures (KPS) equation is from the large mining the stock of houses, the cost of capital, model. 8The MINNIE coefficients emphasize permanent income, capacity utilization, and Euro-dollar borrowings 9 This variable actually has a more powerful effect at the expense of relative prices when compared to the than the MPS credit rationing term, making the MINNIE coefficients in the large model. housing equations more responsive to interest rates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

724 Federal Reserve Bulletin • November 1975 and housing expenditures replace their disag- not generated in MINNIE. In addition, the effect gregated counterparts10 in the MPS model. on assets of inflation through corporate debt has been eliminated. WAGES, PRICES, AND EMPLOYMENT SECTOR FINANCIAL SECTOR Seven equations (beginning with the 23rd equa- The MPS financial sector has 31 stochastic tion of the model) determining aggregate per- equations, whereas MINNIE has only 3. sonhours, hours per person, private domestic In its full specification MPS takes nonbornonfarm employment, civilian employment, the rowed reserves and the discount rate as the unemployment rate, the labor force, and wages primary monetary instruments. Given these are identical to those in the MPS model. The variables, the quantity of demand deposits that critical price equation, determining the deflator banks are willing to supply—the amount supfor nonfarm business product (PXB*), is also plied varies with the buying and selling of identical to the equation in the large model, securities to achieve target levels of free rewhile nine other equations determine various serves—varies positively with the Treasury bill prices through exogenous ratios to PXB*. The rate (RTB). The quantity of demand deposits main departure here is in the method of calcu- that the public is willing to hold (given nominal lating the GNP deflator. In the large model the GNP) varies inversely with the bill rate. Tonational income account product price deflators gether these two equations determine the bill are calculated through exogenous ratios to rate and the stock of demand deposits. PXE*, and the GNP deflator is calculated as In many cases it is useful to think of the a weighted average of these deflators; in MIN- Federal Reserve as following a money stock or NIE, the GNP deflator also is calculated directly Treasury bill rate target and supplying the rethrough an exogenous price ratio. serves necessary to achieve the target values. We have followed that strategy here. The money supply equation and associated identities have been dropped, as has the currency equation. As DIVIDEND, INCOME, MINNIE is currently specified, the policy vari- AND TAX SECTOR able may be either commercial bank demand Five tax equations are specified as exogenous deposits or the Treasury bill rate, whichever the ratios times endogenous bases. The exogenous user prefers.11 ratios are very stable in the short run because If demand deposits are taken as the policy the proportions of the components of the en- variable, then the money demand equation dedogenous variables that are taxed at different termines the Treasury bill rate (RTB). This rates exhibit little change. Similarly, the recon- equation is similar to the MPS version except ciling items that link national income (YNI$) that one term in the weighted average of time and GNP are assumed to be a stable proportion deposit offering rates at commercial banks, savof GNP, as is the effect of accelerated deprecia- ings and loan associations, and mutual banks tion on corporate cash flow. is replaced in MINNIE by the ceiling rate on The dividend equation was re-estimated by commercial time deposits (ZCT) and the dummy using the price of business output rather than variables Q and Q - The rate on time deposits x 2 producers' durable goods and equipment defla- at banks is constrained by the Regulation Q tors in determining the current-dollar investment ceiling and normally the rates move close toin producers' capital because these deflators are gether—the dummies represent the only major shift in the relationship between rates at com- 10The MPS model disaggregates 1- to 2-family housing and 3-or-more-family housing. 11 Or M 1 can be made the exogenous policy variable. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MINNIE: A Small Version of the MIT-PENN-SSRC Econometric Model 725 mercial banks and at thrift institutions in the TABLE 1 post-Korean war period. Effect of increasing Federal purchases of goods The corporate bond rate (RCB) is determined by $1 billion in 1958 dollars for one quarter by a term structure equation relating the bond and then returning purchases to their original rate directly to the Treasury bill rate. In the large level model the term structure is derived from the commercial paper rate, which in turn is deter- X 2 mined through a term structure equation based Quar- MPS MINNIE j Dif | MPS MINNIE |Dif| on the bill rate.12 ter Real GNP Current GNP The equation for the common stock dividend/price ratio is exactly the same as that in 1 1.0 1.1 .1 1.4 1.5 .1 the MPS model, and the final two equations 2 .2 .2 .1 .4 .4 .1 3 .1 .1 .1 .3 .3 .1 close the system by calculating net worth. In 4 .1 .0 .2 .2 .2 .1 the first, net worth is defined as last period's 5 .0 - .1 .3 .2 .1 .2 net worth plus saving plus the capital gain on 6 .0 - .1 .4 .2 .0 .4 7 - .1 - .2 .5 .2 - .1 .7 equities, consumer durable goods, and housing, 8 - .1 - .2 .6 .2 - .1 1.0 while the last equation (63) defines the net worth less equities variable that enters the consump- Unemployment rate Nonfarm business deflator tion function. 1 - .030 - .030 .0 .009 .009 .0 2 - .036i - .034 .002 .016 .017 .001 3 - .007 - .005 .004 .019 .019 .001 4 - .005 - .002 .007 .021 .020 .002 DYNAMIC RESPONSES 5 - .004 - .001 .010 .023 .021 .004 6 - .003 .001 .014 .026 .022 .008 This section compares the short-term (2-year) 7 - .003 .003 .020 .028 .023 .013 responses of MINNIE and of the MPS model. 8 - .002 .005 .027 .031 .024 .020 Since both models are nonlinear, the multipliers NOTE.—£|Dif| is the cumulated absolute values of the are not invariant of the time period of measure- MPS-MINNIE differences. Real GNP is in terms of 1958 dollars. ment. The responses recorded here are based on a $1 billion increase in the policy variable the monetary instrument. The multipliers in in the first quarter of 1970. The shocks from Table 1 correspond to the exogenous demand this increase were not sustained after the first deposits. With demand deposits unchanging, the quarter. initial positive effect of a change in Government expenditures on real GNP—directly, and indi- GOVERNMENT EXPENDITURES rectly through the multiplier and acceleration—is rapidly crowded out by the effect of The choice of the Treasury bill rate or commerrising prices and interest rates on investment and cial bank demand deposits as the policy variable consumption. Exogenous interest rates and an conditions the Government expenditures multiendogenous money stock give much longer pliers. If the Treasury bill rate is exogenous, positive expenditures multipliers. then demand deposits are endogenous and affect The short-run responses of the two models the expenditures multipliers. The Government are remarkably similar. Table 1 compares the expenditures multipliers are different from those dynamic multipliers of MINNIE with the MPS that result when interest rates are endogenously model for four endogenous variables. Note that determined; that is, when demand deposits are after eight quarters, the sum of the absolute values of the differences of the real GNP multi- 12 The MINNIE term structure equation reflects fairly pliers is only 0.6, with the first-year responses accurately the properties of the combined MPS term structure equation. The steady state reaction of RCB even more similar; the other multipliers are not to RTB is slightly smaller in MINNIE, and the steady quite so close, but the conclusion remains that state reaction to inflation is slightly larger, but the sum the short-term responses of MINNIE to Govof the two effects is very close to the MPS values. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

726 Federal Reserve Bulletin • November 1975 ernment expenditures are essentially the same TABLE 2 as those of the larger model. Effect of increasing demand deposits by $1 billion in current dollars for one quarter and then DEMAND DEPOSITS returning deposits to their original level There are three channels of monetary policy in , 2 , , I , both MINNIE and the MPS model. First, an Quar- MPS MINNIE 1 Dif | MPS MINNIE 1 Dif | increase in deposits relative to transactions de- ter mands lowers interest rates and stimulates in- Real GNP Current GNP vestment. Second, the lower interest rates raise 1 .2 .3 .1 .3 .4 .1 equity prices, causing household net worth to 2 .5 .6 .2 .7 .8 .2 rise, and affecting both consumption and resi- 3 .8 .8 .2 1.1 1.3 .4 4 1.0 1.0 .2 1.6 1.6 .4 dential construction. Third, increased interest 5 1.1 1.1 .2 1.8 1.8 .4 rates result in reduced deposits at thrift institu- 6 1.1 1.0 .3 1.9 1.9 .4 7 1.1 .9 .5 2.1 1.8 .7 tions and consequently, non-interest-rate ration- 8 1.1 .8 .8 2.2 1.7 1.2 ing of credit. The multipliers based on an increase in de- Unemployment rate Nonfarm business deflator mand deposits of $1 billion in current dollars 1 - .008 - .008 .0 .002 .002 .0 are given in Table 2. The demand deposit re- 2 - .022 - .023 .001 .009 .009 .0 sponses are not so close to those of the larger 3 - .037 - .037 .001 .018 .018 .0 4 - .049 - .047 .003 .031 .029 .002 model as are the Government expenditures: 5 - .059 - .055 .007 .042 .039 .003 MINNIE'S first few GNP multipliers slightly 6 - .064 - .056 .015 .055 .049 .006 exceed the MPS figures, and the second-year 7 - .065 - .053 .027 .072 .059 .013 8 - .066 - .049 .044 .092 .068 .024 unemployment and price multipliers are smaller. Several factors account for the larger GNP mul- NOTE.—2 | Dif | is the cumulated absolute values of the tipliers. One is the replacement of the actual MPS-MINNIE differences. Real GNP is in terms of 1958 dollars. time deposit rate with the Regulation Q ceiling in the money demand function. Since deposit rates do occasionally move from ceiling levels, multipliers are smaller in MINNIE since State the bill rate is more responsive to deposit and local expenditures are exogenous, whereas changes in MINNIE. Another factor is the sub- in the MPS model the increased income from stitution of the Treasury bill rate (RTB) for the a demand deposit increase leads to slightly commercial paper rate in the term structure higher State and local employment with assoequation determining the corporate bond rate ciated price effects. (RCB). This substitution slightly shortened the Even with these differences, however, the lag from changes in demand deposits to changes MINNIE multipliers are very close to those of in the bond rate. Yet another difference between the MPS model. As Table 2 shows, the 2-year MINNIE and the MPS model that affects the cumulative absolute value of the multiplier dif- GNP multipliers is the dismantling of the entire ferences on real GNP is 0.8 on cumulated time deposit and mortgage sectors that develop MINNIE multipliers of 6.5. The other multithe credit rationing term in the large model. In pliers are also close, with the first three price MINNIE, this term is replaced by the ratio of multipliers exactly the same. Thus, it can be the bill rate to the Regulation Q ceiling. concluded that MINNIE'S short-run responses The second-year unemployment and price mimic those of the MPS model. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MINNIE: A Small Version of the MIT-PENN-SSRC Econometric Model 727 LIST OF UNPUBLISHED WORKING PAPERS 1. Ando, Albert. "Consumption and Consumer 14. Gramlich, Edward M. "State and Local Gov- Expenditures." ernment Expenditures. 2 . "Explanation of Dividends. 15 . "State and Local Governments and 3 . "From Gross National Product to Their Budget Constraint." Disposable Personal Income." 16. Jaffee, Dwight. "An Econometric Model of 4 . "Labor Market." the Mortgage Market: Estimation and Sim- 5 . "On the Role of Expectation of Price ulation." Changes in an Investment Function." 17 . "The Commercial-Loan Market." 6 . "The Basic Price Equation." 7. Ando, Albert, and Modigliani, Franco. 18. Kalchbrenner, Jack. "Summary of the Cur- "Some Reflections on Describing Struc- rent Financial Intermediary, Mortgage, and tures of Financial Sectors." Housing Sectors of the SSRC-MIT-PENN 8. Ando, Albert; Modigliani, Franco; Rasche, Econometric Model." Robert; and Turnovsky, Stephen. "On the 19. Modigliani, Franco. "The Dynamics of Port- Role of Expectation of Price and Tech- folio Adjustment and the Flow of Savings nological Change in an Investment Func- Through Financial Intermediaries in the tion." F-M-P Model." 9. BischofT, Charles W. "A Model Explaining 20 . "The Valuation of Corporate Non-Residential Construction * * * Pre- Stock." liminary Results." 21. Modigliani, Franco; Rashe, Robert; and 10. "A Two-Equation Model Explaining Cooper, J. Philip. "Central Bank Policy, Investment In Producers' Durable Equip- The Money Supply and the Short-Term ment * * * Preliminary Results." Rate of Interest." 1 1. "Elasticities of Substitution, Capital 22. Modigliani, Franco, and Schiller, Robert. Malleability, and Distributed Lag Invest- "Price Expectations, Taxes, and the Term ment Functions." Structure of Interest Rates." 12. de Menil, George. "The Determinants of the Price Level." 23. Rasche, Robert H. "Shipments-Orders Rela- 13. de Menil, George, and Enzler, Jared J. tionships for Machinery and Equipment." "Prices and Wages in the FRB- 24. Slovin, Myron B. "Deposit Rate Setting at MIT-PENN Econometric Model." Financial Institutions." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

728 Statements to Congress Statement by George W. Mitchell, Vice Chair- Government issues, the soundness of such inman, Board of Governors of the Federal Re- vestments has seldom been questioned. The serve System, before the Committee on Bank- historical record for ultimate payment of ing, Housing, and Urban Affairs, U. S. Senate, principal and interest, even among govern- October 18, 1975. mental units that have defaulted on their obligations, has been remarkably good. I am glad to appear before this committee today The record is well documented by the experito discuss the possible implications for the fi- ence of the depression years of the 1930's, when nancial system of the New York City financial close to 4,800 State and local units out of more crisis. than 150,000 were reported to have defaulted The threat of a New York City default—and on their debts, including 48 cities with populaof difficulties in the tax-exempt market more tions of 25,000 or more. According to a study generally—has caused concern in some quarters published by the Advisory Commission on Inregarding the financial condition of our banking tergovernmental Relations, the indebtedness of system. This concern stems from the fact that the defaulting units at time of default was $2.7 commercial banks long have been important billion—close to 18 per cent of the total amount investors in State and local government obliga- of local debt outstanding.2 Yet, by 1938 all 48 tions, including those of New York State and cities were reported out of default, and by 1945 New York City. I am appending to my statement nearly all units of any significant size had settled a table showing the aggregate involvement of their default problems. The loss of principal and banks in the tax-exempt market.1 As of mid- interest resulting from recorded defaults during 1975, all commercial banks had total invest- the depression period, according to a study by the National Bureau of Economic Research, is ments of $102 billion in such obligations, acestimated to have aggregated only $100 million, counting for 47 per cent of all outstanding State or about one-half of 1 per cent of the average and local indebtedness. This was nearly 15 per amount of State and local debt outstanding in cent of all the loans and investments of the the period.3 banking system. A key consideration leading banks to acquire Experience with municipal debt in the postthese large positions in State and local obliga- war years has reaffirmed the record for high tions has been the record of performance of quality established during the depression. Almunicipals as a high-quality, low-risk invest- though more than 400 State and local default ment. There are other reasons banks hold mu- situations had been reported between 1945 and early 1970, most of these appear to have been nicipals, including their tax-exempt status and temporary or technical in nature and to have their eligibility as collateral that can be pledged involved quite small governmental units. The against U.S. and State and local government deposits. While such issues do not have the liquidity and marketability features of U.S. 2City Financial Emergencies: The Intergovernmental Dimension (Washington, D.C.: July 1973). 3George H. Hempel, The Postwar Quality of State Available upon request from Publications Services, and Local Debt (New York: National Bureau of Eco- Division of Administrative Services, Board of Gover- nomic Research, 1971), p. 24. The loss figures do not nors of the Federal Reserve System, Washington, D.C. include lower-interest payments on refunding issues or 20551. accrued interest on unpaid principal or interest. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 729 principal amount of debt reported as in default held New York City securities amounting to as to principal or interest from 1945 through more than 50 per cent of the bank's capital as early 1970 cumulated to approximately $450 of the last examination; in some cases, these million, or less than one-half of 1 per cent of positions may well have been reduced or elimithe total municipal debt outstanding in 1970. nated since that time. If holdings of New York And the bulk of this total—$334 million—was State and State agency issues are included as accounted for by revenue bonds on three major well, the number of banks with such investprojects—the West Virginia Turnpike, Calumet ments aggregating more than 50 per cent of their Skyway Toll Bridge, and Chesapeake Bay capital is raised to only 17; most of these are Bridge and Tunnel. An additional $72 million quite small institutions. was accounted for by 21 other default situations It does not appear, therefore, that there is a involving amounts of $1 million or more, of significant threat of capital impairment, at least which only two were general obligation bonds. among the State member banks. The studies This experience leads me to believe that the conducted by the Comptroller of the Currency chances of ultimate significant loss, especially and the Federal Deposit Insurance Corporation, by investors in general obligation bonds, are I believe, reach more or less similar conclurelatively small. Even if New York City should sions. A more likely possibility is that, in the default for a time on its obligations, the eco- event of default by the city, some banks will nomic tax base will remain and the city will experience a temporary liquidity squeeze—arishave to cure the default in one way or another ing, for example, from sudden shifts of deposits before it can re-enter the credit market. In view from one bank to another, or because banks are of the high probability of ultimate final repay- faced with unexpected requests for credit acment—which means that the securities will commodation by their municipalities, or by continue to have market value—the Federal holders of the defaulted bonds, or by dealers bank supervisory agencies have agreed that a in the municipal securities market who for a reasonable length of time will be permitted, if time may be unable to liquidate their inventories there is a default, before banks would be re- of bonds. quired to write down the book value of their In the event that such a temporary liquidity holdings to market value. During this interim squeeze should develop, the Federal Reserve period of up to 6 months, the default might well has ample power to provide additional funds to be cured and markets return to normal. But even its member banks—and to nonmember instituif this does not happen, it is important to recog- tions when other sources of funds are not availnize that the amount charged off against a bank's able—through loans at the Federal Reserve capital account would undoubtedly be far less Bank discount windows. The Board has adapted than the book value of the security holdings its contingency plans to deal with such an involved. emergency, and I want to assure you, as Chair- We nevertheless have reviewed our most re- man Burns has done before other committees, cent examination reports—some of which may that we are prepared to act promptly and on date back for a year or so—to determine the whatever scale is deemed necessary to assure extent to which concentrations of holdings of an orderly financial environment. We recognize New York City or State securities may exist that such special extensions of central bank among our State member banks. I am submitting credit might have to be sizable and could risk a staff report summarizing this study for the a substantially larger expansion in money and information of the committee.4 It shows that credit than is desirable over the longer run. Such only 6 of our roughly 1,100 State member banks credit accommodations would therefore have to be of a temporary character and would need to 4Available upon request from Publications Services, be reversed later on, but they nevertheless Division of Administrative Services, Board of Gover- would be made readily available in an emernors of the Federal Reserve System, Washington, D.C. gency situation. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

730 Federal Reserve Bulletin • November 1975 I do not want to suggest that a default by ample capability to provide the liquidity that the New York City would not be a very serious financial system may need in such a time of matter for financial markets as well as for the crisis—liquidity which, when supplied in timely city. But I do believe that the public need not fashion and adequate amounts, should help confear for the stability of our banking system if fine the damage in the municipal securities mara default does, in fact, take place. We have kets to only those most directly involved. • Statement by Arthur F. Burns, Chairman, it would subject the expenditures of the Federal Board of Governors of the Federal Reserve Reserve to the congressional appropriations System, before the Committee on Banking, process, with a ceiling to be set on the amounts Housing, and Urban Affairs, U.S. Senate, Oc- that could be spent by both the Board and the tober 20, 1975. Federal Reserve Banks. Second, it would require Senate confirmation of the appointments of Federal Reserve Bank presidents. Third, it I am pleased to have this opportunity to present would require Senate confirmation of the Presthe views of the Board of Governors on S. 2285, ident's appointment of the Chairman of the the "Federal Reserve Act Amendments of Board of Governors. Fourth, it would authorize 1975." each of the seven members of the Board of Let me state emphatically at the outset that Governors to hire a personal staff. Fifth, and while this bill has been characterized as a "re- finally, it would require that the President's form" measure, it would, if enacted, pro- nomination of members of the Board give due foundly alter the premises underlying the Na- regard to a fair representation of labor and tion's central bank. In the Federal Reserve Act, consumer interests, in addition to financial, agthe Congress took great care to insure that the ricultural, industrial, and commercial inter- Federal Reserve would be an independent body ests—as presently specified in the Act. insulated from political pressures or control. The thrust of S. 2285, taken as a whole, is The foundation of that independence is the Sys- to bring the Nation's central bank into the arena tem's exclusion from the appropriations of intense political scrutiny and pressure. As I process. To make the System now dependent have already noted, this is a radical departure upon annual appropriations by the Congress from the concept that was envisioned by the would materially compromise the independence 63rd Congress, which established the Federal of the Federal Reserve. Reserve System, and by every succeeding Con- One may differ with the Board's judgments gress since then. on monetary policy matters, and one may even A change in the basic structure of a Governbelieve that the Congress erred in conferring ment agency is justified when some major defect such independence upon the Federal Reserve. has been discovered in its structure. Such is not But there should be no misunderstanding about the case with the Federal Reserve. On the conthe implications of this legislation: If the Con- trary, its structure has enabled it to serve the gress now sees fit, after more than 60 years of country well through the years, and there is no experience, to abandon the concept of a truly need to change it at the present time. independent central bank, then the Congress To be sure, members of the Congress may, itself must be willing to assume both the burden from time to time, be concerned about policy and the responsibility of formulating monetary decisions of the Federal Reserve, but this of policy. itself is surely no reason to force a restructuring With this preliminary comment, let me now of the institution itself. Policy judgments conturn to the specific provisions of S. 2285. First, cerning money and credit, and their relation to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 731 employment and prices, are bound to differ. The Banks. This and other outlays of the Federal Congress has already established a procedure Reserve Banks are paid from earnings derived that enables it to review Federal Reserve poli- principally from Federal securities acquired cies—namely, House Concurrent Resolution through the System's open market operations. 133 adopted earlier this year. This procedure, These operations are carried out pursuant to law I believe, is so far working well. I have already and with the objective of maintaining sound testified twice in response to that resolution, and economic and financial conditions. Spending of I will be testifying again before this committee the Reserve Banks, in turn, is subject to review later this month. and supervision by the Board of Governors. The Federal Reserve System, as you know, The operations of the Board and of the Rewas established more than 60 years ago. If a serve Banks have been conducted in a highly fresh start were made, the Congress might de- responsible manner. As far as I know, policy vise a structure similar to what we now have decisions have not been influenced in any way or perhaps move in a quite different direction. or at any time by partisan considerations. Nor Before I joined the Board of Governors in early have they been influenced by the possibility that 1970, I thought I saw all sorts of opportunities the budget of the Board or of the Reserve Banks for change in the System. But I soon realized might be slashed because of congressional disthat the structure whose basic shape was devised pleasure with this or that monetary measure. by Woodrow Wilson, Carter Glass, and Robert The Federal Reserve's decisions have thus been Latham Owen worked quite well. governed by the Nation's permanent interest, no In establishing the Federal Reserve, the Con- matter how unpopular they might be in the gress deliberately decided that the national in- short run. terest required that the central bank be insulated In the Board's judgment, the requirement of from political pressures stemming either from S. 2285 that the Congress mandate a ceiling on the Congress or the White House. The Congress Federal Reserve expenditures is not aimed at therefore endowed the Federal Reserve with the control or reduction of public expenditures. capacity to exercise, within reasonable re- Even the complete elimination of all Federal straints, its best judgment on how to protect the Reserve expenditures would amount to less than Nation's money and to foster its effective use. two-tenths of 1 per cent of the Federal Govern- The maintenance of independent judgment by ment's budget. The real aim of the proposed the central bank is essential if monetary policy expenditure ceiling is to shift control over monis to play its proper impartial role in fostering etary policy, but not the responsibility for it, economic growth and maintaining financial sta- away from the Federal Reserve to the Congress bility. The independence of the Federal Reserve or its committees. neither is—nor should be—absolute. The Sys- It would obviously be impossible for the tem is duty-bound to implement the will of the Congress to determine an expenditure ceiling for Congress expressed in legislation, and the Fed- the Federal Reserve without first examining ineral Reserve has been ever faithful to that duty. dividual items of expenditure. The Congress It is under the guidance of the principles set would thus be forced to address itself to such forth by the Congress, especially in the Federal questions as the level of resources needed to Reserve Act and the Employment Act, that the formulate and implement monetary policy, the Federal Reserve has formulated and executed size of the Board's domestic research staff, the monetary policy. In doing so, it has served as size of its international finance section, the a vital nonpolitical entity in a highly political scope of its legal and regulatory staffs, and so environment. on. Similarly, the budgets of the individual Since the inception of the Federal Reserve Reserve Banks would be subject to review and System, the law has provided that the expenses change, with the obvious possibility that some of the Board are to be paid out of semiannual regions would be favored or disciplined more assessments levied upon the 12 Federal Reserve than others. Clearly, political influence could be Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

732 Federal Reserve Bulletin • November 1975 brought to bear on the System by reducing or in System personnel. Here are some examples threatening to reduce the funds available to it, of this increased efficiency: or by ordering a diversion of funds from one —The Federal Reserve Banks now process function or Bank to another. more than 46 million checks daily, up from 22 In assuming any such responsibility, the million in 1967. If we operated at the produc- Congress should ask itself whether it is ready tivity level of 1967, the staff requirement would and willing to undertake the highly complex and be 48 per cent (or 3,025 employees) larger than politically perilous task of shaping the course it is now. of monetary policy. Much the wiser course for —Demand for currency and coin services has the Congress, I believe, is to confine itself to increased 36 per cent since 1967, while the general oversight of the Federal Reserve—a number employed in performing this function function that the Congress is already taking has grown only 18 per cent—or half as much. quite seriously. —The number of U.S. Treasury checks pro- As I suggested earlier in my testimony, the cessed by the Federal Reserve Banks has in- Congress should legislate only when there is a creased 109 per cent since 1967. The staff need to correct a defective condition. There is required to handle this job on behalf of the nothing about the Federal Reserve that at the Treasury has increased only 43 per cent in the present time requires drastic legislative treat- same period. ment, such as is proposed in S. 2285. The fact —The number of Federal tax deposits hanis that the Board and the Federal Reserve Banks dled by the System for the Internal Revenue have managed their operations in a financially Service has increased 180 per cent since 1967. conservative manner, and especially so in recent Despite this increase, the Federal Reserve Banks years. In the relatively few cases where an have reduced their employment in this area by expense item has seemed questionable to the 5 per cent. Board, prompt action has been taken to avoid —Similarly, the number of entries in the a recurrence. Any responsible analysis of Fed- accounts of member banks handled by the Syseral Reserve expenditures will show that they tem has increased since 1967 by 106 per cent. have been reasonable in light of the System's Again, despite this increase, productivity imrapidly growing workload, the increased duties provements have made possible a reduction of imposed by the Congress, and the rise in the our staff in this area by 24 per cent. cost of doing everyday business. The System continually seeks to improve the While the work of the Federal Reserve in the efficiency of its operations. Significant imfields of monetary policy and bank regulation provements in productivity are again being is well known, a large part of System resources achieved this year, and the prospects for 1976 is devoted to activities that are of lesser interest and beyond are excellent. In fact, the total to the general public but which are nevertheless number of individuals employed by the System essential to assuring a smoothly operating fi- will be somewhat lower in 1976 than in 1974, nancial system. These services include check despite a projected 10 per cent increase in the clearing, distribution of coin and currency, wire measurable volume of our output. transfer of funds, and processing of savings In addition to working on productivity imbonds, besides the huge task of acting as the provements, the System frequently reviews its Federal Government's fiscal agent and banker. operations with the aim of eliminating or reduc- The Federal Reserve's growing expenses in ing expenditures without, however, allowing the providing these services have been held down quality of its services to suffer. The System by substantial and continuing improvements in remains fully attentive to the needs of the pubproductivity. Thus, while the measurable output lic, the financial community, the Treasury and of the Federal Reserve System has approxi- other Government agencies. mately doubled in the past 8 years, this has been The real issue raised by S. 2285, however, accomplished with only a 41 per cent increase is not efficiency or economy of operations. It Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 733 is demonstrable, as I have indicated, that we requirement that all of the economic policies of the Government—monetary policy and are operating both efficiently and economically. fiscal policy among them—be coordinated The real issue is the independence—within the with each other in such a way to make a bounds of national economic goals established meaningful whole. The independence of the Federal Reserve System is desirable, not as by the Congress—of this Nation's central bank, an end in itself, but as a means of contributand its ability to formulate judgments that are ing to the formulation of the best over-all free from the pressures of the shifting tides of economic policy. In our judgment, the present degree of independence of the Syspolitics that congressional expenditure control tem is about that best suited for this purpose could impose. under present conditions. This committee also has before it a related proposal that would subject the Federal Reserve That quotation is taken from a report issued to an audit by the General Accounting Office. in 1952 by a distinguished subcommittee of the With your permission, I will indicate the Joint Committee on the Economic Report. The Board's thinking in opposition to this proposal statement is just as valid today as when it was by inserting into the record the testimony on written. a GAO audit presented by Governor Mitchell Let me now turn briefly to the other parts at a hearing of the House Banking Committee of S. 2285. earlier this year. In summary, the Board be- The Board has no objection to the provisions lieves: that would subject the President's choice of the First, that an audit by the GAO of the Federal Chairman of the Board of Governors to Senate Reserve's accounts and expenditures would be confirmation. As this committee is aware, Board a needless duplication of present efforts and members are appointed for a 14-year term. The would result in unnecessary additional expendi- term of Chairman is for 4 years, but he may tures. be reappointed. At present, Board members are Second, that to authorize the GAO to audit named, subject to Senate confirmation, only as Federal Reserve policies, including the pro- Board members. The President designates one cesses by which those policies are reached, of the seven members of the Board to be Chairwould unwisely inject a third party into the man. This selection is not now subject to Senate sensitive area of monetary policy. confirmation. Third, the passage of House Concurrent Res- In my own case, this committee knew when olution 133 has completely altered the context I appeared before it on December 18, 1969, that in which the question of a GAO audit must be I would be designated Chairman of the Board considered. This resolution already provides for of Governors. In effect, then, the Senate cona review of Federal Reserve policy by the firmed my nomination both as a Board member responsible committees of the Congress. An and as Chairman. But the Senate did not have audit such as that provided for in S. 2509 would, the opportunity to intervene when I was redesto say the least, be literally superfluous. ignated as Chairman in January 1974. I see no Before leaving this matter of budget control difficulty whatever with the suggestion that the and a GAO audit, I would like to quote from Congress should have the right to review the a report that was issued after extensive study qualifications of the person designated as Chairand long deliberation by a congressional com- man each time that designation is made. mittee. That report said in part: Next, the Board would have no objection to The independence of the Federal Reserve broadening of the areas to be considered by the System is based, not on legal right, but President in the appointment of Board members on expediency. Congress, desiring that the claims of restrictive monetary policy should provided it be clearly understood that, in disbe strongly stated on appropriate occasions, charging their responsibilities, Board members has chosen to endow the System with a continue to represent the public interest as a considerable degree of independence, both from itself and from the Chief Executive whole and not a particular constituency. We do ... It is naturally limited by the overriding not think it wise to emphasize a narrowness of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

734 Federal Reserve Bulletin • November 1975 background in the selection process. Board because of the lack of a large personal staff. members should be qualified to deal with the During my time on the Board, we have been many complex and sensitive problems that face extremely fortunate in having as Board members the Board. These problems require a good un- highly able and thoughtful men who have derstanding of government finance, money brought a diversity of experience and viewpoint markets, banking operations, and credit prob- to the Board. Our deliberations have never lacked lems. Board members must be able to weigh the expression of differing points of view. the effects that their decisions may have upon We are also fortunate in having a highly labor, consumers, agriculture, housing, in- professional, highly competent staff—men and dustry, commerce, and all other areas affected women who are available to assist all members by their actions. of the Board. The technical resources of our Let me turn next to the proposal for Senate staff are enormous, and it would be practically confirmation of Federal Reserve presidents. This impossible—as well as unnecessary—for each provision would lessen the interest of some, Board member to attempt to duplicate these perhaps many, of the best-qualified persons for resources within his personal office. To the these important quasi-governmental positions. extent that individual Board members need per- At the least, it would represent an unnecessary sonal assistants for the performance of their hurdle in an already thorough selection process. official duties, they already have them. And I Senate confirmation might also tend to subject might add that the members of the Board's staff the post to political influences. Since these po- are never reluctant to express their own views. sitions are geographically spread around the Both I and my Board colleagues defend the country, they could become subject to the type independence of our staff members as vigof influence that was once exercised when post- orously as we defend the independence of the master appointments were subject to Senate Federal Reserve itself. confirmation. That, I submit, would contravene In conclusion, S. 2285, in its key aspects, the basic purpose of the Federal Reserve Act. would weaken the Federal Reserve's ability to The last provision in the bill to which I wish reach dispassionate judgments in behalf of our to address myself would authorize each Board country's betterment. The freedom, within the member to hire a personal staff at salaries he context of national economic policy laid down deems appropriate, providing the total compen- by the Congress, to arrive without fear or favor sation of his staff did not exceed four times his at decisions best calculated to serve the Nation's own annual salary as a Board member. The over-all interest is the Federal Reserve's most underlying premise of this provision seems to precious asset. And it is the Nation's guarantee be that the creation of such personal staffs will of an unbiased hand on the monetary rudder. enhance the independence of Board members Consequently, although the Board does not and encourage diversity of opinion. object to every provision of the legislation under I am compelled to take issue with this prem- discussion, we see no clear need to adopt any ise. The qualities of independent thought and of it. Indeed there are strong reasons, as I have expression do not depend upon the availability indicated, for opposing its key provisions. The of a personal staff. Rather they are qualities that world's history is littered with the economic must inhere in the individual Board member. wreckage caused by political domination of the No amount of staff assistance will convert an monetary function. Your predecessors in the unimaginative or compliant Board member into Congress acted wisely in providing a design for a vigorous, independent advocate of new poli- the Federal Reserve that insulated it from policies. And a Board member who has the ability tics. The Board urges you not to overturn a and interest to express his own thoughts force- structure that has stood so well the test of time fully will not be less independent or provocative and experience. • Additional statements follow. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 735 Statement by J. Charles Partee, Managing that a default on a general obligation bond will Director for Research and Economic Policy, mean a total, or even partial, loss on the invest- Board of Governors of the Federal Reserve ment. In contrast to a business firm, which may System, before the Subcommittee on Economic not survive a financial default, a governmental Stabilization of the Committee on Banking, entity will continue in existence, its economic Currency, and Housing, £/.S. House of Repre- tax base will remain as a source of revenue, sentatives, October 21, 7975. and the default will need to be cured in one way or another before the borrower can hope to re-enter the credit markets. Even if New York I am happy to appear before this committee City should default on some or all of its $12 today to discuss the implications for financial billion in indebtedness, what this would be markets of the New York City fiscal crisis. My likely to mean for the investor would be a comments will be confined to its possible effects temporary loss of liquidity and perhaps some on the banking system, since Chairman Burns loss of current earnings rather than a permanent will be covering some of the broader aspects loss of face value on the security held. of the problem in his testimony before the In view of the high probability of ultimate committee later this week. repayment—which means that the securities A possible default by New York City on some should continue to have a substantial market of its debt obligations—and the recent difficulvalue—the Federal bank supervisory agencies ties of the municipal securities market more have agreed that a reasonable length of time will generally—has caused concern in some quarters be permitted if there is a default by a major regarding the stability of our banking system. municipality before bank examiners will require This concern apparently stems from the fact that that banks write down the book value of the commercial banks long have been major invesdefaulted holdings to market value. During this tors in State and local obligations, including interim period of up to 6 months, the default those of New York State and New York City. might well be cured and the markets might As of midyear the commercial banks as a group return to normal. But even if a full restoration had total investments in tax-exempt securities of value does not occur, it is important to of $102 billion. These holdings accounted for recognize that the amount charged off against 47 per cent of all State and local indebtedness, a bank's capital account is not a projection of and for 15 per cent of total bank loans and ultimate loss but a conservative judgment to investments. The aggregate investment in this assure that the bank's capital is adequate for class of securities considerably exceeds the the other purposes to be served. In any event, capital and reserves of the banking system, such a charge-off would undoubtedly be far less which amount to nearly $75 billion. than the book value of the security holdings Very few of these investments, of course, are involved. A review by the Federal Reserve staff in any question. For the most part they represent of the most recent examination reports of State the securities of highly rated States and localimember banks last summer indicated that very ties, the repayment of which rests upon the few had such large concentrations of New York general power to tax the private economic base City issues that a write-down would threaten of these jurisdictions. Over the years the record impairment of their capital.1 of repayment for such bonds has been extraor- A more likely problem for the banking system dinarily good. Even when there have been some in the event of a New York City default is the defaults in payments of interest or principal on possibility that financial flows could become these so-called general obligation bonds, as distorted for a time. Some commercial banks during the depression years of the 1930's, the defaults have almost always subsequently been *A summary of that study, which was attached to cured and investors have suffered little if any this statement for the committee's information, is available upon request from Publications Services, Division ultimate loss of principal. of Administrative Services, Board of Governors of the It would be a mistake, therefore, to conclude Federal Reserve System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

736 Federal Reserve Bulletin • November 1975 might suffer deposit outflows or have unusual In conclusion, I firmly believe that there is demands for funds to meet their needs and the no need for concern by the public about the needs of their customers. In the event that such viability of our banking system. Some few ina temporary liquidity squeeze should develop, stitutions do appear to have heavy concentrathe Federal Reserve has ample power to provide tions in investments of New York City relative additional funds to its member banks—and to to their capital, but I doubt that any write-offs nonmember institutions when other sources of that might eventually be required would be too funds are not available—through loans at the large for the banking system to handle. Liquid- Federal Reserve Bank discount windows. The ity pressures on particular banks and on some Board has adapted its contingency plans to deal of their customers—including municipalities— with such an eventuality arising from a disturb- might develop for a time, but the powers of ance in the municipal securities market, and it the Federal Reserve System to liquify both inis prepared to act promptly and on whatever dividual banks and the banking system as a scale is deemed necessary to assure an orderly whole are ample enough to accommodate such financial environment. needs. • Statement by Arthur F. Burns, Chairman, say nothing of adding to its outstanding indebt- Board of Governors of the Federal Reserve edness. In the absence of clear-cut remedial System, before the Subcommittee on Economic measures by the city, the possibility of default Stabilization, Committee on Banking, Cur- on the city's obligations became very real, and rency, and Housing, U.S. House of Repre- it was so portrayed almost daily in our newspasentatives, October 23, 1975. pers. The financial crisis confronting the Nation's largest city prompted the government of New I am here to discuss with this committee the York State to offer financial and managerial financial crisis of New York City. assistance. Starting in April the State put at the The difficulties now facing New York stem city's disposal substantial sums that were not from the erosion of its financial position over scheduled for payment until some months later. the past decade. During this period the expend- Then, around mid-June the State legislature itures by the city's government grew rapidly created a new instrumentality—the Municipal while revenues failed to keep pace. To close Assistance Corporation (MAC). This agency the gap between its revenues and expenditures, was empowered to sell up to $3 billion of its the city relied increasingly on borrowed funds. debt obligations to make the proceeds of its Not only capital expenditures but also the borrowing available to the city, to wring some mounting deficits on current operations were clarity out of the city's tangled finances, and financed in this fashion. By the end of 1974, to help develop a budgetary plan that could lead New York City's outstanding debt amounted to the city back to a balanced budget. more than $13 billion, much of which was in These measures, however, proved insufficient the form of short-term notes—that is, obliga- to restore investor confidence in the city's fitions maturing in a year or less. nancial management, and even the new securi- As poor management of New York finances ties issued by MAC soon came under a cloud. persisted, at first a few, but in time more and To ward off imminent default by the city of New more, investors became concerned about the York, the State adopted firmer measures on city's financial condition. During the past winter September 9. These included creation of a and spring, the city began to experience very State-dominated Emergency Financial Control serious difficulties in rolling over its debt—to Board to manage the city's finances, expansion Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 737 of MAC's authority to issue securities, and a The behavior of investors and dealers in replan to arrange additional financing of $2.3 cent months has resulted in a rise of yields on billion for the city. This financial package was municipal securities to the highest level ever designed to tide the city over until early De- experienced in the tax-exempt market. Yields cember. It was hoped that by that time a strong for even the highest-rated borrowers have risen program of budgetary restraints would be in conspicuously, but a part of this increase is place and that it would enable the city to resume doubtless due to the enormous volume of muthe sale of its securities to the investing public. nicipal securities issued in the third quarter. But the new financial plan failed to elicit any In the past 2 to 3 weeks open market interest enthusiasm on the part of investors. The finan- rates have declined somewhat. The municipal cial community has remained skeptical about the market has benefited from this development, as city's ability to avert default and to rebuild its well as from various indications that the Federal financial strength. Moreover, the intertwining of Government is becoming more concerned about the State's finances with the city's finances has New York's financial problems. Nevertheless, troubled investors and has damaged the State's investors in municipal securities remain highly credit standing. The concern of market partici- selective. The obligations of New York City, pants was heightened this past week by the New York State, and certain of the State's extraordinary difficulties encountered in arrang- agencies continue to be shunned by investors. ing for the city's refunding needs on October And the effects of investor uncertainty have 17, and default was averted by only an hour spilled over to other governmental units as well, or two. Thus, the stresses and strains that began some of which have not received any bids for to develop in the municipal securities market their bonds or have rejected bids because the in the summer have become more acute with interest cost was deemed excessive. the passage of time. If the weakness of the market for municipal Since the summer, and to an increasing de- securities were to persist and to spread further, gree in recent weeks, the participants in the many soundly run, creditworthy communities municipal market—that is, investment bankers, and public agencies could have difficulty—or securities dealers, and ultimate investors—have suffer very heavy costs—in raising needed been attempting to reduce their exposure to the funds. This would tend to induce cutbacks or risk of loss. This has affected not only securities stretchouts in local spending programs. In addibearing a New York name but also issues of tion, holders of municipal securities, which insome other State and local governments. Thus, clude many banks and other financial institumany securities dealers have sought to cut back tions, would to some degree be affected, as on their inventory of municipal securities. Un- might the attitudes of others less directly inderwriters of municipal issues have generally volved. Hence, if the New York City crisis reduced their participation in new offerings, and remains unresolved and if the fate of New York some have withdrawn entirely from bidding State remains tied to the city's, the process of syndicates. And investors—the ultimate buyers economic recovery now under way in our Naof municipals—have been tending to shift to tion could be impaired. higher-quality municipal securities or to cate- In seeking ways to resolve New York City's gories of investment judged to be less hazard- crisis, the suggestion has occasionally been adous. vanced that the Federal Reserve might serve as Trading in the market for outstanding tax-ex- a source of emergency credit. No formal appliempt bonds has therefore slowed appreciably, cation for such credit has been received by the and the spread between bid and asked quotations Board or the Federal Reserve Bank of New has widened. These developments are charac- York. But I want to explain why we probably teristic of a period when investor confidence has would have disapproved such an application had been shaken, and they are indicative of a weak- it been made. ened market. As the ultimate source of financial liquidity Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

738 Federal Reserve Bulletin • November 1975 in the economy, the Federal Reserve has certain penditures and also to enable them to make the powers to extend emergency credit even to discount rate effective when little borrowing institutions that are not members of the System. took place at the discount window. There is But the use of that authority is tightly circum- nothing in the Federal Reserve Act or its legisscribed. The basic provision—contained in lative history to suggest that Section 14(b) con- Section 13, paragraph 13, of the Federal Re- templated the purchase of municipal securities serve Act—states that emergency loans with as a means of aiding financially distressed commaturities no longer than 90 days may be made munities. by the Federal Reserve Banks on the basis of The Congress, of course, could amend the promissory notes backed by Treasury or Federal Federal Reserve Act so as to relax the requireagency securities. To qualify for credit assist- ments for extending Federal Reserve credit to ance under this provision of law, a local gov- financially troubled governmental units. But the ernment would have to possess sizable amounts Board of Governors would have the gravest of unencumbered Federal obligations. This doubts about any such action. If loans were to would be an unusual situation for any distressed be made to State or local governments, the borrower, and it obviously does not apply to Federal Reserve would have to involve itself in New York City. the activities of these governmental units, in- The lending authority under paragraph 3 of cluding particularly their expenditure budgets Section 13 of the Federal Reserve Act is and the adequacy of their revenues. Moreover, broader, permitting the Board in unusual and since numerous demands for credit might ensue, exigent circumstances to authorize Reserve the Federal Reserve would have to set standards Banks to make loans on the kinds of collateral of eligibility. Being thus placed in the position eligible for discount by member banks. Such of having to allocate credit among governmental paper may not have a maturity of more than units, the Nation's central bank would inevita- 90 days and must afford adequate security to bly become subject to intense political presthe Reserve Bank against the risk of loss. Fur- sures, and its ability to function constructively thermore, in view of restrictions of law and in the monetary area would be undermined. congressional intent, certain conditions must be The Board fully recognizes that the Federal met in order to permit the extension of emer- Reserve System has the responsibility, subject gency credit under this authority. Among these only to restrictions under existing law, to serve conditions is a requirement that an applicant has as the Nation's lender of last resort. Over the exhausted other sources of funds before coming years, we have therefore developed contingency to the Federal Reserve, that the borrower is plans to deal with possible emergency situabasically creditworthy and possesses adequate tions. As I have already indicated in testimony collateral, and that the borrower's need is solely before the Joint Economic Committee, our plans for short-term accommodation. It does not ap- have been adapted recently to cope with the pear that New York City is now in a position financial strains that might be associated with to meet all these requirements. Certainly, its the default of a major municipality. finances would hardly permit early repayment In that event, I assure you, the Board is of emergency borrowings. prepared to act promptly. The contingency plan In addition to the emergency lending provi- calls for lending to commercial banks through sions in Section 13 of the Federal Reserve Act, the Federal Reserve discount window beyond the Reserve Banks have authority under Section the amounts required by normal discounting 14(b) to purchase short-term obligations of State operations. Credit provided in this manner and local governments issued in anticipation of would assist banks in meeting their temporary assured revenues, subject to regulations by the liquidity needs. Not only that, the proceeds of Board. Legislative history indicates that this the special loans made at the discount window authority was designed to assist the Federal could also be used by the banks to assist mu- Reserve Banks in meeting their operating ex- nicipalities, municipal securities dealers, and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 739 other customers who are temporarily short of securities in significant volume and also of indicash because of unsettled conditions in the se- vidual investors who have part of their life curities markets. In addition, the System would, savings at risk in these bonds. I still believe of course, be ready to use its broad power to that the damage stemming from a default by stabilize markets through open market purchases New York City would probably be shortlived. of Treasury or Federal agency securities. Indeed, the possibility of such a default has In the event this contingency plan has to be already been discounted to a considerable deactivated, the Board will make funds available gree by the market. But I am also aware of the on whatever scale is deemed necessary to assure uncertainty that inherently attaches to a judgan orderly financial environment. The Board ment on this score; and I recognize that a recognizes that sizable extensions of Federal default, besides being a very serious matter for Reserve credit would run the risk of leading to the city and State of New York, could have a substantially larger expansion of bank reserves troublesome consequences for the Nation at and the money supply than is consistent with large. longer-run monetary objectives. Clearly, there- The very fact that this committee and other fore, any such expansion must be only tempo- committees of the Congress are holding hearings rary. In time, any excessive growth in bank on New York City's finances indicates that reserves would need to be corrected through concern is spreading that a New York default offsetting open market operations and through may injure the economic recovery now in repayment of bank borrowing from the System. process. I have said enough to indicate that I There are also certain supervisory and exam- feel this possibility can no longer be dismissed ination questions that may arise with respect to lightly. That, however, does not ease the task banks in the event of a major municipal default. that the Congress faces in dealing with the New In this connection the Board and other agencies York problem; for the precise issue is whether have plans to revise procedures that apply to Federal financial aid to New York may not cause the valuation of defaulted securities so that any national problems over the long run that outwrite-downs may be postponed until the market weigh any temporary national advantage. has had a few months to stabilize and thus As this matter is debated by the Congress, provide more reliable indications of the value the adverse effects of a New York City default of such securities. will undoubtedly receive full attention—as they Even so, a default might ultimately require indeed should. I would only urge that the write-downs that could seriously reduce the longer-run risks also be considered thoroughly. capital of some banks. In that event, the Federal A program of Federal assistance to the city may Deposit Insurance Corporation has statutory well lead to demands for similar assistance to powers to assist Federally insured banks that other hard-pressed communities, even though might find their capital impaired by a decline their distress may have been brought on by gross in the value of securities in their portfolios. I negligence or mismanagement. Substantial understand that the Corporation is prepared to Federal aid—whether through insurance, guarimplement, with appropriate safeguards, its antees, or direct loans—would compete directly contingency plans for dealing with insured with the already huge amounts of Federal fibanks that require a temporary infusion of sup- nancing needs. Most important of all, the proplemental capital for the above reason. vision of Federal credit for local governments I think it evident from the scope of our would necessarily inject a major Federal prescontingency plans that we believe a default on ence in local spending and taxing decisions. debt obligations by New York City could pro- These longer-run dangers have a vital bearing duce serious strains in securities markets. For on our Nation's future; but they can be exaga time it could also adversely affect munici- gerated, just as the immediate consequences of palities that need to issue new debt. The like a New York default can be—and perhaps are is true of financial institutions that hold such now—being exaggerated. It is entirely clear to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

740 Federal Reserve Bulletin • November 1975 me that if the Federal Government had pre- a tax would materially strengthen the State's viously yielded to the entreaties for aid that New resolve to put whatever pressure is needed on York officials kept pressing, neither the city nor the troubled municipality to work its way toward the State would have gone as far as they now a balanced budget. It would thus insure that the have in restoring some hope for eventual order State will discharge adequately its own responin the city's finances. Earlier intervention would sibility to enforce fiscal discipline on a troubled have been a disservice to the people of New municipality. No governor or State legislature York as well as to the Nation at large. But it will welcome the prospect of levying a special also seems to me that the effort thus far made statewide tax for the benefit of a municipality by both the State and the city is still inadequate. that has mismanaged its affairs. But this very And while I take a more serious view of the reluctance would provide some assurance that potential economic consequences of a New Federal assistance would not be expected until York default than I did 3 months ago or even an effective city-State program of remedial ac- 3 weeks ago, I am not ready to recommend to tion, no matter how politically troublesome this the Congress that financial assistance to New may prove, has been developed. York is now required in the Nation's interest. Fourth, prior to receipt of Federal assistance, I was asked at a recent hearing what advice a detailed financial plan would need to be pre- I would give if the Congress were inclined to sented for approval by the Federal authority legislate assistance for New York. My reply was charged with administering the assistance prothat stringent conditions should in that event be gram. Criteria for accepting a plan would have laid down so that no municipality would seek to be spelled out—such as the use of standard Federal financial aid unless such a request be- accounting procedures, unrestricted access by came unavoidable. I proceeded to list a half- the Federal authority to all local financial dozen conditions; and, if I may, I shall now records, provision for retiring short-term debt restate them somewhat more fully. other than that required to handle seasonal dis- One essential condition prior to receipt of any crepancies between expenditures and receipts, Federal assistance would be that the munici- and so on. Clearly, the plan should provide for pality has exhausted all other sources of funds. restoration of sound municipal finances within This would require, of course, that the munici- a relatively short period and certainly within two pality demonstrate that it is unable to obtain fiscal years. credit through the public issuance of securities, Fifth, a municipality that obtains a Federal or through private placement of securities, or guarantee for the payment of principal and indirect loans from banks or other private lenders. terest on its issuance of new securities should A second condition that seems to me essential be required to pay an appropriate guarantee fee. is that the State assume control over the finances The municipal security should be taxable, but of the municipality in difficulty. When a local tax-exempt bonds might be permitted in special government reaches the point where no source cases—for example, if return to nonguaranteed of funds is any longer available, its management status were thus eased. In such cases the guarof finances can no longer be relied upon. State antee fee would naturally have to be much control would mean that a local government has higher than if the security were taxable. lost its fiscal authority, and this should serve Sixth, and finally, the Federal guarantee proas a powerful deterrent to other mayors or city gram should be of limited scope and duration. councils across the Nation from ever placing The total amount of guaranteed debt should be their municipality in such a position. set at the lowest practical figure. The debt in- A third essential condition for Federal assist- struments should be of short maturity so that ance, I believe, should be that the State levy the guarantee may be reconsidered periodically. a special statewide tax, the proceeds of which In order to minimize Federal exposure to risk are pledged to cover one-half of the deficit faced and to assure compliance with the approved by the municipality. The requirement of such financial plan, the Federal Government should Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 741 have authority to withhold revenue-sharing Before bringing this testimony to a close, I funds from a delinquent municipality. At the want briefly to make two additional comments. end of a relatively short period, say 3 years, First, recent attention to New York City's all Federally guaranteed debt under the program difficulties has brought to the fore certain shortshould have expired. comings of our bankruptcy laws. It is highly If conditions along the several lines I have important that the Congress enact legislation here suggested were included in a legislative that would enable the judiciary to deal with a plan for assisting troubled municipalities, the municipal default so that reorganization of outnumber of applicants that might seek Federal standing debts, service or employee contracts, aid would be severely limited. It is highly im- and other financial obligations may proceed in portant to recognize that the issue of assistance an orderly and expeditious manner. to New York City goes to the very heart of our Second, the behavior of financial markets has system of separation of powers between the recently been disturbed by the grave uncertain- Federal and State governments—a system that, ties surrounding New York City finances. A despite enormous economic and social changes, quick but well-considered decision by the Conis still honored by our country. If there is to gress to assist or not to assist New York is now be any legislation on assisting local govern- urgently needed. Almost any resolution of these ments, it should at least be designed so that the uncertainties may be better than prolonged delonger-run risks to our Federal system of gov- bate and controversy. Financial markets do not ernment are kept to a minimum. thrive in such an environment. • Statement by Philip E. Coldwell, Member, debt positions of the Treasury of the United Board of Governors of the Federal Reserve States. System, before the Subcommittee on Domestic The authority has been used exclusively at Monetary Policy of the Committee on Banking, times when the Treasury has been faced with Currency, and Housing, U.S. House of Repre- an abrupt temporary depletion of its cash balsentatives, October 23, 1975. ance, chiefly just prior to the receipt of quarterly tax payments. Rather than issue debt in the market to borrow funds needed for only a few 1 am pleased to meet with the committee today days, the Treasury has sold securities directly to present the views of the Board of Governors to the Federal Reserve Banks under this provion H.R. 7507, a bill that would amend Section sion of law. Then, immediately after tax pay- 14(b) of the Federal Reserve Act to extend for ments were received, these special debt obliga- 2 years the authority of Federal Reserve Banks tions were retired. Timely use of this direct to purchase U.S. obligations directly from the lending authority has thus enabled the Treasury U.S. Treasury. The current authority expires on to minimize its public financing activity— the 31st of this month. thereby avoiding unnecessary strains on finan- Since first authorized by the Congress in cial markets—and to achieve a more efficient 1942, the direct purchase authority of Section management of its cash balance. 14(b) has been used sparingly from the stand- In both March and August of the current year, point of frequency, amount, and duration alike. the Treasury found it useful to issue special In fact, since the Congress last extended this obligations directly to the Federal Reserve. authority on October 28, 1974, it has only been During the first period, which surrounded the used on three occasions. Nonetheless, in such March 15 income tax date, the daily average instances, it has proven of great value in facili- of System holdings of such obligations tating the economic management of the cash and amounted to about $750 million, and the largest Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

742 Federal Reserve Bulletin • November 1975 amount held on any 1 day was a little more might create. Unusual strains that might threaten than $1.0 billion. In the second period—which the immediate sale of securities in a disorderly encompassed a major Treasury refinancing that market could also be covered by the special also raised some new money—the Federal Re- purchase arrangements. serve Banks held special Treasury debt obliga- From the standpoint of Federal Reserve tions on most days between August 5 and Au- operations, the special purchase authority has gust 17. The average of holdings on these days been only a minor complication. When the was about $520 million, and the highest amount direct purchase takes place and the Treasury held on any 1 day was $965 million. expends these funds, the Federal Reserve may In addition to serving as an instrument for take some offsetting actions in order to maintain achieving short-run cash management objec- the monetary policy environment deemed detives, the Board believes that the direct purchase sirable for the financial needs of the economy. authority of Section 14(b) has provided and will Thus, to a considerable extent, such special continue to provide the Treasury with a desira- sales to the Federal Reserve are then translated ble safety valve against an unexpected shortfall into System sales to the market. Of course, in its cash balance. Such a shortfall could de- System open market responses to the use of the velop if estimates of Government receipts and special purchase arrangements in any given peexpenditures, which are difficult to project, riod will depend upon the duration, size, and should suddenly turn out to be materially in timing of the Treasury use, and the particular error. Also the sheer volatility of the Treasury reserve needs of the moment. balance and the unpredictability of some fluctu- In the Board's view, if this special purchase ations constantly threaten shortfalls or an over- arrangement were not to be extended, then some draft. If the Treasury is to manage its balances other emergency device would be needed to to the minimum needed, then some protection enable the Treasury to meet the unexpected. should be provided. Since there is little cost to Obviously, if the Treasury were to abuse the the direct purchase arrangements and since they special authority or if the program were sharply have been used quite sparingly, it would seem enlarged, the Board would have some concern. logical to us that the authority be renewed. But given the small use and the modest size Direct purchase authority, moreover, would of the special authority, the Board has no reason prove particularly valuable if a period of na- for objecting to its use. In summary, it is the tional emergency were to develop, since it Board's view that the Federal Reserve System's would enable the Treasury to respond immedi- authority to purchase obligations directly from ately to any financial strain that such conditions the Treasury should be extended. • Statement by Philip C. Jackson, Jr., Member, Act (RESPA) of 1975. The Board has interest Board of Governors of the Federal Reserve in this legislation as an agency with respon- System, before the Subcommittee on Housing sibilities over creditors and to consumers, as an and Community Development of the Committee organization with concerns for monetary condion Banking, Currency, and Housing, U.S. tions in the Nation, and finally, as a regulator House of Representatives, October 28, 1975. under the truth in lending aspects of the real estate settlement procedures required under the Act. It is this final matter—the truth in lending Thank you, Mr. Chairman, for the opportunity aspects of real estate settlement procedures—on to present the views of the Board of Governors which I would like to concentrate during this of the Federal Reserve System on proposals to testimony. amend the Real Estate Settlement Procedures The RESPA has been in effect only a very Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 743 short time. The Board does not know if the make decisions on his credit and closing reports of lenders claiming substantial increases costs—especially for such a major undertaking in administrative costs under the required pro- as the purchase of real estate. RESPA requires cedures are correct. Nor do we have any factual that truth in lending be disclosed twice: once evidence whether or not RESPA has reduced in advance of settlement and again on the day closing costs to consumers, or whether it is of settlement. The Board recommends to the likely to do so in the future. Congress that it amend the Real Estate Settle- Implementation of RESPA required coor- ment Procedures Act to require that the truth dination between the Department of Housing in lending disclosures be furnished to the borand Urban Development and the Board of Gov- rower only one time, in advance of the date ernors to assure that the basic requirements of of settlement, and not require that they be duthe Truth in Lending Act administered under plicated at the time of closing. Truth in lending Board supervision would be incorporated into disclosures received on the day of settlement RESPA procedures. The Board and HUD have are too late to serve any shopping function. The done so. During the course of this coordination Board believes that these minor changes will and the early stages of the Act's implementa- not adversely affect consumers but will reduce tion, the Board has become aware of several the amount of effort necessary to give coninstances of needless complexity and procedural sumers adequate disclosure as to the facts conproblems with the Act. cerning their credit transaction, while avoiding First, as the committee knows, all consumer unnecessary duplication. Moreover, such discredit grantors, including those in the mortgage closures need not be made to the seller, in the market, have operated under truth in lending Board's opinion. procedures for the past 6 years. Creditors have Finally, the Board urges the Congress to developed forms that are in almost universal repeal entirely the provisions of Section 409 of operation to meet the requirements of that Act P.L. 93-495, which amended the Truth in and to fit the needs of each lender-borrower Lending Act to require advance disclosure of transaction. RESPA mandated that existing closing costs. The committee will recall that this forms on real estate credit transactions be re- Act was passed on October 28, 1974, prior to placed by standard forms. Because of the com- the enactment of the Real Estate Settlement plexity and variety of real property transactions, Procedures Act. We feel that the provisions of it was extremely difficult to develop a standard the Real Estate Settlement Procedures Act sup- RESPA form that was easily applicable to all planted the need for Section 409 disclosure and transactions. Standardization required lenders to therefore, Section 409 is no longer necessary. change procedures and adapt to the new required While there are some transactions that are not forms. It required industry personnel to be re- covered by the Real Estate Settlement Procetrained in new truth in lending procedures. dures Act to which Section 409 disclosure of Lenders report that this change has proved closing costs would be applicable—such as costly, without better disclosures on the cost of some home improvement transactions—there is credit to consumers as a result of the change. real doubt of the value of advance disclosure Therefore, the Board would recommend that of closing costs in such situations for several creditors be permitted to use, for such truth in reasons. First, closing costs are usually not a lending disclosures, any form meeting the re- material factor in total consumer costs in such quirements of the truth in lending statute, or transactions. Second, these transactions are at the creditor's option, the present uniform usually subject to the 3-day right of rescission disclosure statement contained in RESPA under the Truth in Lending Act because they forms. are secured by real estate that is the primary Second, the Board has long supported re- residence of the borrower. Consequently, if the quirements that a prospective borrower be given consumer does not like the credit deal proposed, proper information in advance on which he can he can cancel it. Finally, the time framework Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

744 Federal Reserve Bulletin • November 1975 within which such transactions take place is plex as to eliminate some lenders from conusually so short that disclosure delays may be sumer markets, thus reducing the competition detrimental to the consumer's interest. for the consumer's business. More harm could The Board is currently in the process of arise from increasing the cost of creating proper implementation of Section 409, having waited borrower-lender relationships. Since lenders until final RESPA procedures were completed must in the final analysis make investments in order to avoid public confusion between the based on net return after administrative costs, two disclosure requirements. any increases in administrative costs of lenders In a broader context, the Board has earlier in competitive markets are ultimately passed on expressed concern that legislation purporting to to the consumer either directly or indirectly. assist consumers may actually harm them by Reports from others give the Board concern that imposing burdens on the creation of borrower- the Real Estate Settlement Procedures Act may lender relationships. Such harm might come be creating both of the problems that I have from creation of requirements that are so com- described. • Statement by Arthur F. Burns, Chairman, employment has risen by more than 1 Vz million. Board of Governors of the Federal Reserve The average factory workweek has lengthened System, before the Committee on Banking, appreciably. Unemployment has declined from Housing, and Urban Affairs, U.S. Senate, No- its peak in May despite a sizable increase of vember 4, 1975. the labor force this year. And the increase of employment has become more widely diffused I am pleased to meet with this committee to across the economy. Of the 172 nonfarm indusreport once again on the condition of the na- tries on which the Bureau of Labor Statistics tional economy and the course of monetary reports, only 17 per cent experienced an increase policy. of employment in February. The corresponding When I submitted to you the Federal Re- percentage rose with considerable regularity in serve's report on May 1, the American economy succeeding months and reached 72 per cent in was at the trough of the deepest decline in September. production of the entire postwar period. Since As we look back, it is clear that the consumer then, a recovery of economic activity has gotten led the way out of recession and into recovery. under way. Between April and September in- Early this year, when price concessions became dustrial production rose almost 6 per cent; each fairly common, consumer purchases began to month's increase exceeded that of the month pick up. Consumer buying was further butbefore, and the September increase was the tressed over the spring and summer months by largest in more than a decade. The scope of tax rebate checks and supplementary social sethe recovery has also been broadening. Produc- curity checks. Retail sales of nondurable goods tion of durable goods has advanced strongly of rose briskly; and as confidence improved, conlate, and the increase of activity in the nondura- sumers also became more willing to dip into ble goods sector—which began earlier—has savings or incur new indebtedness in order to continued. Improvement has spread beyond the purchase big-ticket items. This is clearly evident Nation's factories, mines, and power plants, and in the automobile sector, where sales of new the over-all increase in the physical volume of cars have been running recently at an annual production during the third quarter turned out rate of around 9Vi million—a considerable adto be one of the largest in recent years. vance from the 7 million rate of last November. As real output moved upward, the demand A sharp turnaround in foreign trade also for labor kept strengthening. Since March, total helped to pave the way for economic recovery. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 745 Our trade balance was unfavorable throughout ably look forward to some further abatement of 1974, and the deficit reached an unprecedented cost and price inflation. $9 billion annual rate in the third quarter of last We as a Nation have made notable progress year. But a deep cutback of imports—especially in reducing the rate of inflation that prevailed of fuel and industrial supplies—occurred during during 1974. Consumer prices rose over the first the recession, while the demand for our exports three quarters of this year at about half the pace held up well. The result was a swing in our recorded a year earlier. The rise in wholesale trade position to a surplus at an annual rate of prices slowed even more. These improvements more than $13 billion in the second quarter of resulted mainly from slack demand in product this year. There has been a significant rise of markets and the competitive pressures that imports recently, as is to be expected during forced business managers to watch costs more a cyclical expansion. Nevertheless, our trade closely and to enhance efficiency. These efforts surplus is still large, the over-all balance of have begun to bear fruit; output per manhour payments remains favorable, and the dollar is turned up in the second quarter—thus registeragain a highly respected currency around the ing the first increase in more than 2 years—and world. rose further in the third. Sustained buying by foreigners and American Of late, however, there has been some worconsumers enabled business firms to make ex- sening in the rate of inflation. Broad measures cellent progress in clearing their shelves of of price performance indicate a rise in the third excess inventories. Liquidation of inventories quarter at an annual rate of around IV2 or 8 got under way around the beginning of this year, per cent—compared with 5V2 per cent in the and in the second quarter the rate of decline second quarter. To be sure, special factors— was larger in relation to the gross national such as the unexpected Russian need for grain product than in any quarter of the entire postwar and the further rise of energy prices—were period. By early summer stocks were coming partly responsible for this development. But into reasonable balance with sales in most con- price increases have also occurred in a number sumer lines, and many firms engaged in retail of industries—autos, steel, aluminum, and and wholesale trade therefore began to rebuild chemicals, among others—where considerable inventories. Meanwhile, the pace of inventory slack still exists. And the increase in the price liquidation slowed considerably in the manu- of imported oil that went into effect on October facturing sector. For business firms in the ag- 1 may well lead to price advances over a wide gregate, inventory liquidation receded from an range of products in the months ahead. annual rate of about $30 billion in the second Some step-up in the rate of increase in the quarter to a rate of $10 billion in the third. This general price level was perhaps unavoidable, in shift in business inventory investment has been view of the vigor of economic recovery and the a major factor in the recent sharp rise of our persistent rise of wages. Nevertheless, the Nation's production of goods and services. quickening in the pace of inflation during recent The willingness of businessmen to move fur- months—in the face of high unemployment and ther in replenishing depleted stockpiles, and widespread excess industrial capacity—is a thereby provide a continuing thrust to general clear warning that our long-range problem of business activity, will depend heavily on the inflation is unsolved and remains a threat to strength of consumer demand. That in turn will continuance of economic recovery. be influenced materially by the real income of Elimination of the long-run inflationary bias consumers, their financial position, and the state of our economy will require progress on nuof confidence—all of which are linked to infla- merous fronts, including a marked strengthening tionary developments and prospects. In the of business expenditures for new plant and Board's judgment, improvement of the econ- equipment. Growth and modernization of the omy is likely to continue at a satisfactory pace Nation's industrial capacity are essential to only if consumers and businessmen can reason- avoid a recurrence of capacity shortages in crit- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

746 Federal Reserve Bulletin • November 1975 ical sectors of the economy, to lay the basis securities as loan demands strengthened, a subfor greater improvements in productivity, and stantial volume of Treasury bills had to be to expand job opportunities for our people. absorbed by the general public. Borrowings by As often happens in the early months of a the Treasury in the 2- to 3-year maturity range cyclical upswing, business spending for fixed were also very heavy. A series of such note capital has lagged behind the recovery in other issues in August and September drove up intersectors. The rise that appears to have occurred est rates, attracted a sizable number of individrecently in the production of business equipment ual investors, and served to reduce the flow of is as yet inconclusive. Various indicators sug- savings to banks and thrift institutions. gest, however, that an upturn of business capital These developments left their mark on the investment may not be far away. Contracts for residential mortgage market. Lenders became commercial and industrial construction have more hesitant to commit funds, and interest rates stabilized during recent months. New orders for on new mortgage loan commitments drifted nondefense capital goods, though edging off in upward. Nevertheless, mortgage rates remain the past 2 months, are now about 8 per cent below their 1974 peaks, and funds remain readabove their level in March. Moreover, the rate ily available in nearly all areas of the country of formation of new business firms—another where unrealistic interest rate ceilings do not advance indicator of business capital invest- impede the flow of credit. ment—is moving up again. Increases of interest rates have been particu- Further improvement in the homebuilding in- larly prominent in the market for State and local dustry is also a vital ingredient of a full-fledged government securities. The financial problems economic recovery. The decline in market rates of New York City have had widespread reperof interest that began in the summer of 1974 cussions on the cost and availability of credit bolstered the flow of savings to mortgage-lend- to State and local governments. Although yields ing institutions last fall, and a substantial rise on high-grade municipal obligations have risen in mortgage loan commitments soon followed. about in line with yields in other long-term Early this year the volume of sales of both new markets, increased investor caution has resulted and old dwellings rose, and these sales are in a marked widening of yield differentials becontinuing to run well above their lows of last tween municipal issues of high quality and those winter. With better market conditions, housing of lower quality. Authorities with relatively low starts—especially of single-family dwellings— credit ratings have experienced pronounced inhave been moving up again. The recovery in creases in borrowing costs, and, in some inhomebuilding, however, has been weak. Prices stances, they have been effectively excluded of new and existing houses, to say nothing of from the public market. Despite these adversiother costs of homeownership, have risen so ties the municipal bond market continued to drastically that many American families cannot function well enough to permit a record volume afford to buy a home. Builders, moreover, re- of long-term issues during the third quarter. In main very cautious in view of the overbuilding the past few weeks, however, the volume of and financial difficulties of recent years. new municipal issues has dropped appreciably. Mortgage lenders have also remained cau- Of late, the need of business firms to borrow tious, in part because of fears that the enormous in the long-term capital market has diminished financing requirements of the Federal Govern- as their liquidity generally improved, and as the ment would drive up market interest rates and downward adjustment of business inventories thereby attenuate the flow of funds to thrift and better profits generated an enlarged flow of institutions. The Federal budgetary deficit dur- cash. During much of this year, however, the ing the third quarter was the largest on record. market for long-term funds has been under In just 3 months the volume of Treasury bills pressure—first, from corporate security issues, outstanding rose by $14 billion. Since commer- later from heavy Treasury borrowing and an cial banks reduced their purchase of government extraordinary volume of new municipal securi- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 747 ties. The Federal Reserve has sought to provide encouraging, but we are still a long way from some assistance to the long-term market by re-establishing reasonable stability in the price shifting the emphasis in its open market opera- level. In light of these facts, the only responsible tions from Treasury bills to longer-term securi- option open to the Federal Reserve is to pursue ties. Since the beginning of the year, the System a course of moderation in monetary policy—a has acquired more than $6 billion of Treasury course that will provide expansion in supplies and agency issues bearing maturities of more of money and credit adequate to facilitate further than 1 year. Of this total, $2 billion was ac- good recovery of production and employment, quired since midyear. but not so large as to rekindle the fires of These purchases have been helpful in steady- inflation. ing the bond market during periods of unusual To implement this course of policy, the Fedtension, but they can have only an ephemeral eral Open Market Committee has projected influence on long-term interest rates. The fun- growth ranges of the monetary aggregates that damental factor forcing up long-term interest differ little from those announced previously. rates in recent years has been the high rate of For Mi, which includes currency and demand inflation that persistent deficits in the Federal deposits, the projected growth range for the budget kept fueling. Appreciably lower long- coming year is again 5 to IV2 per cent. For M , 2 term interest rates would, I believe, contribute which includes consumer-type time and savings powerfully to economic expansion, but they are deposits at commercial banks besides the comunlikely to be attained unless significant ponents of M the growth range has been u progress is made in closing the budgetary deficit widened by reducing the lower end of the range and in bringing inflation under control. one percentage point. The growth range for M , 3 Exercise of fiscal discipline at all govern- which includes deposits at thrift institutions bemental levels is badly needed to ease the ten- sides the components of M , has been similarly 2 sions and uncertainties that have disturbed fi- widened. These adjustments were made in view nancial markets this year. The pressure of Fed- of recent experience, which suggests that preseral financing on interest rates during the third sures on market interest rates stemming from quarter resulted not only from the sheer mas- heavy Treasury borrowing tend to moderate siveness of the Federal deficit but also from inflows of savings funds to depositary institusuccessive upward revisions in borrowing tions. The growth range projected is thus 7Vi needs. The sharply higher yields in the market to IOV2 per cent for M and 9 to 12 per cent 2 for municipal securities have reflected the heavy for M . 3 borrowings by State and local governments, as These growth ranges now apply to the period well as reduced confidence in the finances of extending from the third quarter of 1975 to the some of these governmental units. The climate third quarter of 1976—rather than from the for economic expansion would be greatly im- second quarter of 1975 to the second quarter proved by clear evidence that governmental of 1976. This updating of the base, I should authorities at all levels are finally willing to live note, implies a slightly higher level of money within their means and to get along without balances a year from now than would be the financial gimmickry. case if the second-quarter base were retained. We in the Federal Reserve fully recognize Since I last reported to this committee on May that monetary policy has an important role to 1, growth of the monetary aggregates has been play in maintaining a financial environment that broadly in line with the ranges we adopted is favorable to sustained economic expansion. earlier. However, month-to-month and quarter- The strength of the economic recovery to date to-quarter changes in the aggregates have been has been heartening, but we are still a long way very large, reflecting unusual factors influencing from reasonably full employment of our labor the public's demand for money. and capital resources. The reduction in the rate The largest short-term variation occurred in of inflation accomplished this year has also been M , the narrowly defined money stock. Thus, x Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

748 Federal Reserve Bulletin • November 1975 M grew at an exceptionally high annual rate— efforts to keep the rate of monetary expansion x 11.2 per cent—during the second quarter, as the from straying too far from the desired longer-run public's holdings of cash bulged during May path. It is important to recognize that the Federal and June because of the tax rebates and special Reserve's conduct of monetary policy conforms social security payments authorized by the in this respect not only to our best judgment Congress. As these excess balances were sub- but also to the spirit of House Concurrent Resosequently drawn down, growth of M slowed lution 133. x to a 2.2 per cent annual rate from July through The longer-range growth rates of the mone- September. There were similar, though smaller, tary aggregates we are now seeking are, we variations in the growth rates of M and M . believe, adequate to finance a vigorous further 2 3 Measured on the basis of quarterly averages, expansion in real economic activity. Let me the pattern of monetary expansion was much stress once again, however, that the relation more stable. M increased at an annual rate of over time between money balances and the x 8.6 per cent between the first and second quar- physical volume of economic activity is rather ters, and 6.9 per cent between the second and loose because so much depends on the willthird quarters. The comparable figures were ingness of businessmen and consumers to use 11.2 and 10.4 per cent for M and 13.8 and their existing money holdings. We know from 2 13.1 per cent for M . earlier history that the turnover of the narrowly 3 Short-run fluctuations in the rate of monetary defined money stock tends to rise faster in the growth are practically unavoidable, but they recovery stage of the business cycle than does also have little significance for the functioning the monetary stock itself. Recent experience has of the real economy. That is why we use quar- confirmed this tendency. Thus, between the terly average levels of money balances as the second and third quarters of this year, M x base for specifying longer-run objectives for rose—as I noted earlier—at a 6.9 per cent monetary expansion. However, we cannot ig- annual rate. But the income velocity of M— x nore the short-term movements of money bal- that is, the ratio of gross national product to ances in the conduct of monetary policy because M —rose during that period at an annual rate x it is necessary to be alert to any large and of 8.7 per cent. protracted departure of monetary growth rates In deciding on the appropriate target ranges from longer-run objectives. for growth of the monetary aggregates, we at Around the middle of this year the major the Federal Reserve must carefully consider the monetary aggregates were increasing at rates far probable movements of income velocity over above the longer-run ranges that the Federal the course of the business cycle. We must also Reserve was seeking. We therefore set forces bear in mind that innovations in financial marin motion that helped to return the pace of kets can have large effects on the economy's monetary expansion to the moderate rate de- needs for money and other assets to finance sired. More recently, increases in the monetary economic expansion and to satisfy the public's aggregates have fallen below our projected liquidity preferences. ranges. Once again, steps have been taken— We are living in a time of rapid changes in including a modest reduction in reserve require- the public's demand for currency, for checking ments—to encourage a return to the desired path accounts, for savings deposits, and for a host of long-run monetary expansion. of other liquid assets. Over the past 20 or 30 These corrective actions have had some in- years, dramatic developments in financial techfluence on the level of interest rates—particu- nology have reduced substantially the proporlarly short-term rates—which rose conspic- tion of spendable funds that is held in the form uously in late June and early July, but have of currency and demand deposits. More and recently retreated on a broad front. Temporary more corporate treasurers have learned how to fluctuations such as these in short-term market get along with a minimum of deposits in their interest rates are an inevitable byproduct of checking accounts. Consumers, too, have Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 749 learned to keep a larger part of their transactions any given time. Clearly, the Federal Reserve and precautionary balances in the form of sav- cannot focus attention exclusively on any single ings deposits at commercial banks, or deposits measure of money balances. We must be alert in savings and loan associations, or certificates to the possibility that our longer-run projected of deposit, or Treasury bills, or shares of money ranges for the monetary aggregates may need market funds, or other income-earning liquid to be altered in view of changes in financial instruments. Of late, telephonic transfer of technology, as well as more basic economic and funds from savings accounts to checking ac- financial developments. counts is accelerating the trend toward holding Let me remind this committee, finally, that transactions balances in income-earning form. the growth rates of money and credit presently Furthermore, as a result of recent financial desired by the Federal Reserve cannot be maininnovations, liquid assets other than currency tained indefinitely without running a serious risk or checking deposits are being used to an in- of releasing new inflationary pressures. As the creasing extent directly for transactions pur- economy returns to higher rates of resource poses. Since 1970 customers of mutual savings utilization, it will eventually be necessary to banks and savings and loan associations have reduce the rate of monetary and credit expanbeen able to authorize payment of regularly sion. The Federal Reserve does not believe the scheduled household expenditures, such as time for such a step has yet arrived. But in view mortgage payments, directly from their savings of the economic recovery that has been under accounts. This year authority for such third- way since last spring, we are closer to that day party transfers was broadened to include any now than we were 6 months ago. payment, regardless of purpose, and permission Our Nation is confronted today with a serious was granted to commercial banks to offer similar difficulty in its search for ways to restore full services to their customers. And since 1974 employment. Highly expansionist monetary and commercial banks and thrift institutions in fiscal policies might, for a short time, provide Massachusetts and New Hampshire have been some additional thrust to economic activity. But allowed to offer so-called "NOW" accounts to later on the rate of inflation would accelerate their customers. These accounts pay a rate of sharply—a development that would create even interest that practically equals the rate on regular more difficult economic problems than we have savings accounts, and yet they permit direct yet encountered. This committee's report on transfer of funds through a negotiable instru- monetary policy, issued in June, recognized this ment comparable to a check. basic truth in stating that "if inflation is rekin- These changes are having a significant impact dled, any recovery will be short-lived and will on the type of financial assets that the public end in another recession, one almost certain to holds to meet its transactions needs and on the be more virulent than the present one." range of financial institutions that are involved Conventional thinking about stabilization in supplying payments services. Savings and policies, as I tried to explain in a recent address loan associations and mutual savings banks, as at the University of Georgia, is inadequate and well as nonmember commercial banks, are now out of date. Stimulative financial policies have an important part of the Nation's payments considerable merit when unemployment is exmechanism. And yet they are not subject to the tensive and the price level is stable or declining. reserve requirements imposed by the Federal But such policies do not work well when the Reserve on member banks. As a consequence, price level keeps on rising while there is conthe scope of monetary control exerted by the siderable slack in the economy. Experience both Federal Reserve is being eroded. in our own and other industrial countries sug- The financial innovations that I have de- gests that once inflation has come to dominate scribed so summarily are also increasing the the thinking of a Nation's businessmen and difficulties of determining the growth rates of consumers, highly expansionist monetary and the monetary aggregates that are appropriate at fiscal policies do not have their intended effect. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

750 Federal Reserve Bulletin • November 1975 That is, instead of fostering larger consumer New ways must be found to bring unemployspending and business investment, they may ment down without becoming engulfed in a new well lead to larger precautionary savings and wave of inflation. That is why structural policies sluggish consumer buying. require far more attention than they are being The only sound fiscal and monetary policy accorded by academic economists or members today is a policy of prudence and moderation. of the Congress. • Statement by Arthur F. Burns, Chairman, should conduct the people's business in public. Board of Governors of the Federal Reserve But that is a slogan, not a reasoned argument— System, before the Government Information and and a dangerous slogan at that. There is much Individual Rights Subcommittee of the Commit- of the work of government that should be contee on Government Operations, U.S. House of ducted in private. Indeed, the "Sunshine" bills Representatives, November 12, 1975. themselves recognize a number of such areas. It is particularly important, I believe, that collegial bodies, such as the Board of Gover- I welcome the opportunity to convey to this nors, be given substantial latitude in determincommittee the grave concern felt by the Board ing which of their functions should be carried of Governors of the Federal Reserve System on in public session. The relationships among over the application of the Government in the members of such bodies are complex; and free Sunshine Acts, H.R. 9868 and H.R. 10315, to discussion, argument, and dissent are essential its monetary policy and bank regulatory func- elements of the decisional process. A fundations. In appearing before you, I seek exemption mental precondition of the free exchange of of these functions from the coverage of these ideas is an atmosphere in which new or bills. We are less troubled by, and thus can unpopular ideas—or even wrong ideas—can be accept, application of these bills to the Board's put forth for discussion without fear of embarconsumer affairs functions—an area with which rassment or recrimination. some members of this committee have consid- A requirement that decisions be reached in erable familiarity. public session, or even a requirement that closed At the outset I would like to make a few sessions be transcribed for possible disclosure general observations about this legislation. at a later date, would not create this type of First, let me say that I am well aware of the atmosphere. On the contrary, I believe such concerns of public policy that led to these bills. requirements would tend to inhibit free discus- There has unquestionably been an erosion of sion and to make performers out of the participublic confidence in the integrity of government pants. It is naive to believe that agency officials in recent years. People are concerned about will debate publicly with the same candor and secrecy in government, and many have come sense of mutual purpose with which they will to be skeptical about the motives of government debate in private. With a public audience in officials. These are troubling symptoms in a attendance, or with the potential for public disdemocratic society and must be dealt with. closure of a verbatim transcript, such debate will But the cure is not to require that all govern- inevitably become somewhat formalized and the ment decision-making be carried on in a public participants will often speak not for the benefit forum. The concept of an "open" government of each other, but for the impact on their public does not mean that responsible officials cannot audience or for the record. The result will be properly deliberate in private. The supporters to diminish the quality of the decision-making of this legislation often say that government process by inhibiting freedom of discussion or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 751 else to force agency members to carry on their would be seriously compromised if we were real discussion and debate privately and infor- required to carry on our proceedings in public mally. It would be ironic indeed if legislation or if our deliberations were recorded verbatim intended to promote openness in government for possible future disclosure. While the exand to restore confidence in the processes of emptions set forth in the bills before the comgovernmental decision-making actually had the mittee recognize several areas in which public effect of turning public meetings into ceremonial meetings are not appropriate, other provisions occasions on which decisions previously deter- of the bills—to which I shall refer at a later mined by caucusing were acted out. But this, point—would severely reduce the Board's abil- I submit, is a likely result of the "Sunshine" ity to protect the public interest and to conduct proposals. its work efficiently. For these decisive reasons, The basic responsibilities of the Federal Re- we have concluded that we must ask the Conserve involve: first, the formulation and imple- gress to exclude the Board's monetary policy mentation of monetary policy, and second, the and bank regulatory activities from the coverage supervision and regulation of banking institu- of this legislation. tions. Each of these major responsibilities in- I realize that in seeking exemption for the volves the Board daily in matters of great sensi- Board's monetary policy and bank regulatory tivity. At virtually every meeting of the functions I am not pursuing a popular course. Board—and we meet at least three times a However, I have not taken an oath of office week—the discussion covers such matters as the to be popular; I have sworn to perform in a supply of money and credit, financial market totally responsible manner the duties of my conditions, the relationship of the dollar to other office. These duties and responsibilities require currencies, and the condition of U.S. banks and that I make as clear as possible the need for bank holding companies. At almost every the exemption the Board seeks with respect to meeting we act on applications from banks and its monetary policy and bank regulatory funcbank holding companies in which one or another tions. of these matters is vitally relevant. Whether we H.R. 9868 and H.R. 10315 are substantially are considering changes in our monetary policy, identical in their provisions. Each would require or revisions in our banking regulations, or the a multimember agency to expose to the public need for supervisory action concerning a prob- such of its deliberations as concern the conduct lem bank, or the formulation of positions on or disposition of official agency business. The legislative matters, our deliberations must take bills seek to guard against the potential havoc account of the impact our decisions will have of unrestricted public exposure of agency delibon the banking system and the health of the erations by providing 10 exemptions from the economy. I fail to see how the public interest requirement for open meetings. But I must say would be served by subjecting these deliber- that even if the Board conducted all or most ations to the risk of public exposure. of its business in closed session, the requirement I believe our deliberative process has worked of both bills for a verbatim transcript—which extremely well. Debate is carried on at the could later lead to public disclosure—would, in Board table freely and in an atmosphere of joint my judgment, effectively destroy the protection inquiry and mutual respect. Very frequently our provided by closed meetings. consideration of the issues raised by a particular The Federal Reserve is this Nation's central case will prompt far-ranging discussion among bank and monetary authority. Responsible ex- Board members on fundamental policy ques- ercise of the duties assigned to it by the Contions. Our meetings thus reflect what I consider gress is essential to the strength and stability to be the great virtue of a collegial body—the of the American economy. The Federal Reserve free and uninhibited exchange of ideas and has the duty of providing for the expansion of information. I cannot be more emphatic when money and credit that is needed to promote I say that the quality of the work of our Board economic growth and full use of human and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

752 Federal Reserve Bulletin • November 1975 capital resources. It has the duty of protecting This claim is inaccurate. For even if we interpret the integrity of our national currency, of pre- these exemptions to encompass the Board's serving order in financial markets, or promoting monetary policy and bank regulatory functions, improvements in the Nation's payments mecha- the procedural requirements with respect to nism, and of assuring the soundness of the closed meetings would still subject deliberations commercial banking system. Moreover, it has in those meetings to the risk of later exposure, the duty also of serving as the banker for the in full or in part. Treasury and other Federal agencies. Thus, even though the public may be ex- From the foregoing brief reference to the cluded from a meeting, the possibility that a nature of the Federal Reserve's responsibilities, verbatim transcript will be released soon after it should be clear that the Board is virtually the meeting would have much the same inhibitunique among Federal agencies. This status, I ing effect on the deliberative process as if the regret to say, is not recognized in either of the public were present at the meeting. Furtherbills before this subcommittee. The require- more, the need to give prior public notice of ments of these bills for open meetings and for the subject matter of closed meetings would not transcript publication may be appropriate for only focus public attention on sensitive deliberregulatory agencies involved with freight and ations that should be conducted free from public passenger rates, safety standards, trade regula- scrutiny but could encourage market speculation tions, and the like. But none of these agencies or other undesirable consequences. For exhas duties that even remotely resemble those of ample, prior notice that the Board was to take a central bank—an institution whose deliber- up a controversial holding company application ations involve highly sensitive and volatile fi- on a particular day could affect the market for nancial matters of national and international the company's securities. Similarly, advance scope. notice that the Board intended to discuss the The inclusion of the Federal Reserve's mon- desirability of a change in bank reserve requireetary policy and bank regulatory functions under ments or in the discount rate could cause market the bills in question would be fraught with no speculation or have other adverse effects. less mischief than the inclusion of meetings of I am also concerned that the "Sunshine" bills the National Security Council, or meetings of would curtail the free flow of information to the the Secretary of State with his principal aides, Board. Much of the data we rely upon is furor meetings of the Secretary of the Treasury nished in confidence by private sources. Even with foreign finance ministers, or meetings in though Board discussions of such information camera of the members of a Federal appellate may ultimately be held exempt from disclosure, court. Fortunately for the welfare and stability the mere possibility of disclosure may well cut of this Nation, such an absurd result is not off our sources of information. For example, contemplated by these bills. However, by virtue it is my considered judgment that foreign central of the mere fact that the Board of Governors banks would severely limit their present candid is a collegial body whose members are ap- exchanges of views with the Board if the Board pointed to that body by the President, its equally were required to give public notice of the subject sensitive deliberations are exposed to the full matter of closed meetings and to record every impact of these bills. I can say without fear of word spoken at a closed meeting—to say nothcontradiction that no central bank in the world ing of the fact that a court might later require functions under the inhibiting, constraining, and that the complete recording be released to the potentially destructive conditions that H.R. public. Such a constriction of international ex- 9868 and H.R. 10315 would impose. changes would damage our foreign relations and I am aware of the claim that the exemptions destroy economic and financial relationships that set forth in these bills allow closed meetings have served our country well over the years. under certain circumstances and thus provide Another area of great concern to the Board protection against the dangers of which I speak. is the risk of disclosure of sensitive information Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 753 about individual banks. Many years have passed on the Nation's financial condition is appalling. since this Nation has been confronted with a But the opportunity for mischief goes even major run on commercial banks. This is in large further, and I therefore must pursue the illusion part due to careful bank regulation—a process that the provisions of the bills for closed meetcharacterized by extremely guarded release of ings assure against unwarranted disclosure. If data about institutions experiencing financial a challenge in the form of a lawsuit were made difficulties. Under the public announcement and of the Board's withholding of sensitive material transcript provisions of the "Sunshine" bills, from an otherwise published transcript of a however, neither the Board of Governors nor closed meeting, it would indeed be possible for any other agency involved in the regulation of a reviewing court to examine in camera the financial institutions, such as the Securities and subject matter in question. Up to this point the Exchange Commission, could assure protection confidentiality of the material has been profrom unwarranted release of such information tected. However, it is hardly conceivable that in the future. This is particularly troublesome pursuit of the processes involved in the judicial in the case of H.R. 10315; for, while its provi- review afforded by the bills, including necessary sions enable an agency to delete sensitive por- briefs, affidavits, and the like, would not result tions of a transcript, they also require that in harmful speculation about, if not actual disagency to furnish the public with a summary closure of, part or all of what the closed meeting of the deleted sensitive portion. The effect of sought to protect. this requirement, in my judgment, is to give Let me now make a final but most essential withholding authority to the agencies with one comment. One of the stated purposes of both hand and then, for all practical purposes, to bills is to protect the ability of the Government withdraw that authority with the other hand. to carry out its responsibilities. In the context An example of this consequence, I believe, of the bills, the responsibilities are those of may be instructive. If, let us say, the Board multimember agencies—agencies that by conwere acting on the application of a nationally gressional foresight and intent have been so known bank holding company to acquire a bank structured as to encourage and facilitate the free and that application raised some troublesome and uninhibited exchange of views among their questions about the management or financial members. In addition to the full exchange of condition of either the bank or the holding views among its members, the Board draws on company, such a meeting could be closed under the knowledge and thinking of its experienced the bills before us. Assume that after lengthy staff officials who, in the atmosphere afforded discussion of the critical management or finan- by the present environment, have always felt cial difficulty, the Board denied the application. free to comment upon, question, and even chal- Under H.R. 10315, the Board would be required lenge Board member positions, in the interest to release to the public the transcript of its of hammering out the soundest possible policy discussion although the portion dealing with the or decision. sensitive factors could be deleted. Since the I submit that if every word spoken by a Board, by statute, has to consider managerial member of the Board or its staff were recorded, and financial factors in every case, the very with the potential of eventual release to the deletion from the public transcript of any dis- public, either pursuant to the provisions of these cussion of one of these factors would at once bills or as a result of judicial determination, lead to the inference that it was a problem area. some—if not all—of these individuals may quite Further, this inference would be confirmed by naturally be diverted from seeking truth to the required summary or paraphrase of the de- speaking "for the record." In such an environleted portion of the transcript. The foregoing ment, there will be less willingness on the part is a simple example of literally hundreds of of the Board to be receptive to the direct chalserious problems that would arise year in and lenge from members of the staff, and the memyear out under this bill. The potential impact bers of the Board—I dare say—will be less Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

754 Federal Reserve Bulletin • November 1975 candid with one another, or even with them- hand, they could operate under the law as enselves. acted with the virtual certainty that some of the I believe we must face the problem before destructive consequences I have indicated in my us realistically. Insofar as the Federal Reserve remarks will occur. On the other hand, they is concerned, I do not believe that we can could go through the motions of adhering to the afford, in the national interest, to circumscribe law's requirements but, as a practical matter, every action of Board members in an endless resort to procedures that minimize the law's array of recording requirements and still expect adverse impact. Since such action would the quality of thorough analysis and thoughtful amount to circumvention of the law or "going care that have marked the Board's actions over underground" in our operations, I must and do the years. reject it as a suitable course for the Federal If enacted into law, either H.R. 9868 or H.R. Reserve. I hope that as your committee ponders 10315 would place sensitive financial agencies this legislation, you will consider carefully my in an almost impossible position. On the one grim assessment. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

755 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON SEPTEMBER 16, 1975 1. Domestic Policy Directive The information reviewed at this meeting suggested that output of goods and services—which had turned up in the second quarter—was increasing appreciably in the current quarter and that prices, on the average, were rising at a somewhat faster pace than in the first half of the year. Staff projections suggested that expansion in output would remain strong in the fourth quarter and that the rate of growth would then moderate somewhat in the first half of 1976. In August the pace of economic recovery appeared to have gained momentum; both industrial production and employment in nonfarm establishments advanced more than in July. The average workweek of production workers in manufacturing industries continued to lengthen, and for the first time since October 1974 it approached 40 hours. The unemployment rate—which had declined from 9.2 per cent in May to 8.4 per cent in July—was unchanged, as the civilian labor force increased about as much as total employment. Retail sales apparently declined slightly in August, following 4 months of large gains in real as well as in dollar-value terms. The increase in the index of average hourly earnings for private nonfarm production workers was large in August, after having been relatively small in July; over recent months, on the average, the advance has been somewhat less rapid than in 1974 and in the first quarter of 1975. The wholesale price index for industrial commodities rose somewhat more in August than in July, in part because the rise in August reflected earlier increases in gasoline prices; the index for farm and food products declined slightly. In July the rise in the consumer price index had accelerated further, owing chiefly to sizable increases in retail prices of foods, gasoline, fuel oil, and used cars. Staff projections continued to suggest that nominal GNP would expand rapidly in the second half of 1975 as a result of a vigorous recovery in output and a somewhat faster rise in average prices Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

756 Federal Reserve Bulletin • November 1975 than in the first half, mainly reflecting increases in prices of foods and energy products. As a month earlier, it was expected that business inventory liquidation would slow sharply from the extraordinary rate in the second quarter; that real consumption expenditures would grow at a substantial pace; that residential construction would pick up; and that business fixed investment outlays would begin to strengthen late in the year. However, it also was anticipated that—in view of the projected strength of the domestic recovery—imports would expand more than exports. The exchange value of the dollar against leading foreign currencies—which had appreciated considerably from late June to mid- August—rose somewhat further to mid-September, in part because interest rate developments here and abroad continued to favor the dollar. In July U.S. merchandise imports rose sharply, to a considerable extent because of a large increase in imports of fuels from the depressed level in June, and the U.S. foreign trade surplus declined from the very high rates in June and in the second quarter as a whole. Private capital transactions reported by banks shifted to a net inflow in July from net outflows in earlier months. U.S. liabilities to foreign official agencies declined, after having increased earlier, as some countries sold dollars to support their currencies in the foreign exchange markets. Total loans and investments at U.S. commercial banks continued to expand at a moderate pace in August. Outstanding loans to businesses declined slightly, but banks again added a substantial amount to their holdings of U.S. Government securities. The outstanding volume of commercial paper issued by nonfinancial businesses—which had turned up in July—rose again in August, reflecting a modest strengthening in business demands for shortterm credit and a lower cost of funds in the commercial paper market than at banks. In mid-September a number of banks raised the prime rate further, from 7% to 8 per cent. Expansion in M picked up somewhat in August from the low x rate in July, when it had been limited to a significant degree by adjustment of money balances after the May-June bulge associated with special disbursements by the Treasury. Growth in M and 2 M slowed further in August, however, as inflows of consumer-type 3 time and savings deposits to banks and to nonbank thrift institutions continued to moderate, in part because of the increased attractive- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 757 ness of alternative investments. Banks reduced the outstanding volume of large-denomination CD's for the seventh consecutive month, in response to continued growth in other deposits and to weakness in loan demand. On September 10 the Treasury announced an estimate of its borrowing needs for the rest of 1975, which involved raising $22 billion to $25 billion of new money. For the period through the third week in October, the Treasury's financing plans included auctions of $2 billion of 29-month notes, $6 billion of 2-year notes, and $1.9 billion of 1-year bills. Of the total of $9.9 billion, $7 billion represented new money. Short-term market interest rates—which had increased appreciably from mid-June to mid-August—subsequently changed relatively little, despite increased Treasury and private demands for funds in the short-term market. On the day before this meeting, the market rate on 3-month Treasury bills was 6.50 per cent, compared with 6.42 per cent on the day before the August meeting. Yields on longer-term Treasury and corporate securities edged lower over most of the inter-meeting period, in response mainly to the stability in short-term markets and to a substantial decline in offerings of new securities. However, yields adjusted upward after September 10 when the Treasury announced its sizable borrowing requirements over the rest of this year. Yields on State and local government securities rose to new highs in early September because of widespread concern about possible repercussions of New York City's financial crisis; on September 9 a State program to assist the city was enacted. In home mortgage markets, yields advanced throughout the inter-meeting period, as demands for funds expanded while the outlook for their cost and availability became more uncertain. System open market operations since the August 19 meeting had been guided by the Committee's decision to seek bank reserve and money market conditions consistent with moderate growth in monetary aggregates over the months ahead. It had been expected that the weekly average for the Federal funds rate might vary in an orderly fashion within a range of 5% to 7 per cent, with the understanding that operations would not be directed toward moving the rate above or below the 6Vs to 6lA per cent area prevailing at that time unless it appeared that in the August-September period Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

758 Federal Reserve Bulletin • November 1975 growth in the monetary aggregates would be substantially stronger or weaker than expected. Data that became available in early September suggested that in the 2-month period M would grow 1 at a rate in the lower part of the range of tolerance that had been specified by the Committee and that M would grow at a rate slightly 2 below the lower limit of its range. All available members of the Committee concurred in Chairman Burns' recommendation of September 5 that—in view of the likelihood of substantial strengthening in demands for money and credit over coming months and the prospect that a decline in the Federal funds rate might have to be reversed shortly—the Manager be instructed to continue until the next meeting to maintain reserve conditions consistent with a Federal funds rate in the 6V& to 6V4 per cent area, while leaning toward the lower figure. On the average, the Federal funds rate remained in that area over the rest of the period until this meeting. At its July meeting the Committee had agreed that growth in the monetary and credit aggregates on the average over the period from the second quarter of 1975 to the second quarter of 1976 at rates within the following ranges appeared to be consistent with its broad economic aims: M 5 to 7V£ per cent; M , 8V2 to WV2 l5 2 per cent; M , 10 to 12 per cent; and the bank credit proxy, 6V2 3 to 9V2 per cent. In its discussion of current policy at this meeting the Committee took note of the indications that economic activity was now on the increase and of the likelihood that expansion in nominal GNP over coming quarters would be associated with considerable strengthening in the demand for money and credit. The continuing unsettlement in financial markets and the successive large-scale Treasury financing operations scheduled for coming weeks were also taken into account. In view of the economic outlook, none of the members favored operations to ease bank reserve and money market conditions in the period immediately ahead. Some advocated operations to achieve some modest firming, whenever feasible without disrupting markets, in order to help restrain monetary growth later. And others noted that they would be willing to act promptly to seek firmer conditions if and when the rate of growth in the monetary aggregates accelerated substantially, but that they preferred not to base such action on projections that monetary growth would exceed the desired rates over the longer run. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 759 At the conclusion of the discussion the Committee decided to seek bank reserve and money market conditions consistent with moderate growth in the monetary aggregates over the months ahead, while taking account of developments in domestic and international financial markets. Specifically, the members agreed that growth in M and M over the September-October period at annual rates x 2 within ranges of tolerance of 5 to 8 per cent and 7 to 9Vi per cent, respectively, would be acceptable. It was thought that such growth rates would be likely to involve annual rates of change in reserves available to support private nonbank deposits (RPD's) within a range of 1 to 4 per cent. The members agreed that in the period until the next meeting the weekly average for the Federal funds rate might be expected to vary in an orderly fashion within a range of 6 to 7 per cent. It was understood, however, that if developments with respect to the aggregates suggested the need to move the Federal funds rate above 6% per cent, open market operations toward that end would not be undertaken until after the Chairman had consulted with the Committee. The following domestic policy directive was issued to the Federal Reserve Bank of New York: The information reviewed at this meeting suggests that output of goods and services—which had turned up in the second quarter—is increasing appreciably further in the current quarter. In August industrial production and nonfarm payroll employment expanded at a faster pace than in July, and the average workweek in manufacturing continued to lengthen. The unemployment rate remained at 8.4 per cent, as the civilian labor force increased about as much as total employment. Retail sales apparently declined slightly, following 4 months of large gains. The index of wholesale prices of industrial commodities rose somewhat more in August than in July, chiefly because of increases in prices of energy products; prices of farm and food products declined slightly. The advance in average wage rates over recent months has been somewhat less rapid than in 1974 and early 1975. In recent weeks the exchange value of the dollar against leading foreign currencies has risen somewhat further. In July the U.S. foreign trade surplus declined from the very high second-quarter level, as imports rose sharply. Bank-reported capital movements showed a net inflow, in contrast to the net outflows of earlier months, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

760 Federal Reserve Bulletin • November 1975 while U.S. liabilities to foreign official agencies, which earlier had been rising, declined. Expansion in M picked up somewhat in August from the low x July rate. Growth in Af and Af slowed further, however, as inflows 2 3 of consumer-type time and savings deposits to banks and to nonbank thrift institutions continued to moderate, reflecting in part the increased attractiveness of alternative investments. Interest rates on short-term securities and on longer-term Treasury and corporate securities have shown little net change in recent weeks, except that longer-term yields adjusted upward following the Treasury's September 10 announcement of its sizable borrowing requirements over the rest of this year. Yields on State and local government securities rose to new highs in early September, as a result of widespread concern about possible repercussions of New York City's financial crisis; on September 9 a State program to assist the City was enacted. In light of the foregoing developments, it is the policy of the Federal Open Market Committee to foster financial conditions conducive to stimulating economic recovery, while resisting inflationary pressures and contributing to a sustainable pattern of international transactions. To implement this policy, while taking account of developments in domestic and international financial markets, the Committee seeks to achieve bank reserve and money market conditions consistent with moderate growth in monetary aggregates over the months ahead. Votes for this action: Messrs. Burns, Volcker, Baughman, Bucher, Coldwell, Eastburn, Holland, Jackson, MacLaury, Mayo, Mitchell, and Wallich. Votes against this action: None. Subsequent to the meeting, on October 2, the available data suggested that in the September-October period both M and M x 2 would grow at rates well below the lower limits of the ranges of tolerance that had been specified by the Committee. The Federal funds rate had averaged 6.36 per cent during the statement week ending October 1 and most recently had been about 6lA per cent. In view of the weakness of the aggregates and of the unsettled market for municipal securities, Chairman Burns recommended that the Manager be instructed to aim at a Federal funds rate of 6Vs per cent immediately and to aim to reduce the rate to 6 per cent over the next few days. The Chairman also recommended that the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 761 lower limit of the funds rate constraint be reduced to 53A per cent, in order to provide leeway for further operations in the event that current weakness of the aggregates was confirmed by incoming data in the following week. All available members of the Committee—with the exception of Mr. Bucher—concurred in the Chairman's recommendations. Mr. Bucher, while concurring in the first recommendation, preferred not to reduce the lower limit of the constraint before data on the aggregates became available in the following week. 2. Authorization for Domestic Open Market Operations On October 3, 1975, Committee members voted to increase from $3 billion to $4 billion the limit on changes between Committee meetings in System Account holdings of U.S. Government and Federal agency securities specified in paragraph 1(a) of the authorization for domestic open market operations, effective immediately, for the period ending with the close of business on October 21, 1975. Votes for this action: Messrs. Burns, Volcker, Baughman, Bucher, Coldwell, Eastburn, Jackson, MacLaury, Mayo, Mitchell, and Wallich. Votes against this action: None. Absent and not voting: Mr. Holland. This action was taken on recommendation of the System Account Manager, who had advised that large-scale purchases of Treasury and Federal agency securities since the September meeting of the Committee—required mainly to counter the effect of a rise in Treasury balances at the Reserve Banks—had reduced the leeway available for further purchases to about $300 million. While projections for coming weeks suggested that the System would be in a position to absorb rather than to provide reserves, the Manager believed that in view of the fragile state of confidence in financial markets, especially the municipal market, it would be desirable for the Desk to have additional flexibility to deal with unfolding developments. Records of policy actions taken by the Federal Open Market Committee at each meeting, in the form in which they will appear in the Board's Annual Report, are released about 45 days after the meeting and are subsequently published in the BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

762 Law Department Statutes, regulations, interpretations, and decisions EQUAL CREDIT OPPORTUNITY (c) Applicant means any person who applies to a creditor directly for an extension, renewal or The Board of Governors has issued a new Regcontinuation of credit, or who applies to a creditor ulation B.* The Regulation implements the Equal indirectly by use of an existing credit plan for an Credit Opportunity Act prohibiting discrimination amount exceeding a previously established credit on the basis of sex or marital status with respect limit. With respect to any creditor the term also to any aspect of a credit transaction. includes any person to whom credit is or has been extended by that creditor. R E G U L A T I ON B (d) Application means an oral or written request by an applicant for an extension of credit which Effective October 28, 1975, Regulation B (Part is made in accordance with procedures established 202) is added as set forth below: by a creditor for the type of credit requested. The term does not include the use of an existing credit SECTION 202.1—AUTHORITY AND SCOPE plan to obtain an amount of credit which does not This Part comprises the regulations issued by exceed a previously established credit limit. the Board of Governors of the Federal Reserve (e) Arrange for the extension of credit means System pursuant to the Equal Credit Opportunity to provide or offer to provide credit which is or Act (Pub. L. 93-495; 88 Stat. 1521 et seq.). This will be extended by another person under a busi- Part applies to all persons who regularly extend, ness or other relationship pursuant to which the offer to extend, arrange for or offer to arrange for person arranging such credit participates in the the extension of credit for any purpose whatsoever decision to extend credit to an applicant. The term and in any amount. does not include participation in a credit transaction which is limited to honoring a credit card. SECTION 202.2—GENERAL RULE (f) Consumer credit means credit offered or A creditor shall not discriminate against any extended to a natural person in which the money, applicant on the basis of sex or marital status with property or service which is the subject of the respect to any aspect of a credit transaction. transaction is primarily for personal, family or household purposes. SECTION 202.3— (g) Contractually liable means expressly obli- DEFINITIONS AND RULES OF CONSTRUCTION** gated to repay all debts arising on an account by reason of having signed an agreement to that For purposes of this Part, unless the context effect. indicates otherwise, the following definitions (h) Credit means the right granted by a creditor apply: to an applicant to defer payment of a debt, or to (a) Act means the Equal Credit Opportunity Act incur debt and defer its payment or to purchase (Pub. L. 93-495; 88 Stat. 1521 et seq.). property or services and defer payment therefor. (b) Account means an extension of credit; "use (i) Credit card means any card, plate, coupon of an account" throughout this Part refers only book or other single credit device existing for the to open end credit. purpose of being used from time to time upon presentation to obtain money, property or services on credit. (j) Creditor means any person who regularly *The former Regulation B, Open Market Purchases of Bills extends credit or arranges for the extension of of Exchange, Trade Acceptances, Bankers' Acceptances was credit. The term includes assignees, transferees or revoked April 1, 1974. subrogees of an original creditor if they participate **Note that for some purposes some of the definitions are not identical with those found in 12 CFR 226 (Regulation Z). in the decision to extend credit, but does not Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 763 include a person whose only participation in a (b) Separate accounts. A creditor shall not credit transaction is to honor a credit card. refuse, on the basis of sex or marital status, to (k) Credit transaction means every aspect of grant a separate account to a creditworthy applian applicant's dealings with a creditor including, cant. but not limited to, solicitation of prospective ap- (c) Inquiries as to marital status. (1) A crediplicants by advertising or other means; information tor shall not ask the applicant's marital status if requirements; investigatory procedures; standards the applicant applies for an unsecured separate of creditworthiness; terms of credit; furnishing of account, except in a community property State or credit information and collection procedures. as required to comply with State law governing (1) Discriminate against an applicant on the permissible finance charges or loan ceilings. basis of sex or marital status means to treat an (2) If the creditor asks the applicant's marital applicant less favorably than other applicants on status, only the terms "married," "unmarried" the basis of sex or marital status. or "separated" shall be used. (m) Extension of credit means the granting of (3) Not withstanding any other provision of this credit in any form and includes, but is not limited subsection, a creditor may inquire as to the liability to, credit granted in addition to any existing credit to pay alimony, child support or maintenance. or credit limit; credit granted in the form of a credit Further, if a creditor first discloses to an applicant card, whether or not the card has been used; the that income from alimony, child support or mainrefinancing of any credit; the consolidation of two tenance payments need not be revealed if the or more obligations; the issuance of a new credit applicant does not choose to disclose such income card in place of an expiring credit card or in in applying for credit, a creditor may inquire substitution for an existing credit card; the contin- whether any income stated in an application is uing in force of a previously issued credit card; derived from such a source. or the continuance of existing credit without any (4) Where an applicant is requested to designate special effort to collect at or after maturity. a title (such asi Mr., Mrs., Ms. or Miss), the (n) Marital status means the state of being creditor shall state conspicuously that the designaunmarried, married, or separated, as defined by tion of such title is optional. An application form applicable State law. For purposes of this Part, shall otherwise use only terms that are neutral as the term "unmarried" includes a person who is to sex unless other terms are required by an endivorced or widowed. forcement agency to monitor compliance with this Part. (o) Open end credit means credit extended (d) Equal Credit Opportunity Act notice. (1) pursuant to a plan under which the creditor may Except where application is made by telephone, permit the applicant to make purchases or obtain or orally for an amount of credit to exceed an loans, from time to time, directly from the creditor existing limit on an applicant's open end account, or indirectly by use of a credit card, check or other the creditor shall provide each applicant with the device, as the plan may provide. The term does following notice in writing: not include negotiated advances under an open end real estate mortgage or a letter of credit. The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of (p) Person means a natural person, a corpora- sex or marital status. The Federal agency which administers compliance with this law concerning this (insert appropriate tion, government or governmental subdivision or description—bank, store, etc.) is (name and address of the agency, trust, estate, partnership, cooperative or appropriate agency). association. (2) Such notice shall be provided in a form that (q) State means any State, the District of Columbia, the Commonwealth of Puerto Rico or any the applicant may retain, either: territory or possession of the United States. (i) on a copy of the application form; or (ii) on a separate sheet of paper delivered to SECTION 202.4—APPLICATIONS the applicant at the time application is made, or delivered or mailed to the applicant as soon as (a) Discouraging applications. A creditor shall practicable thereafter. not make any statements to applicants or prospec- (e) Designation of name. A creditor shall not tive applicants which would, on the basis of sex prohibit an applicant from opening or maintaining or marital status, discourage a reasonable person an account in a birth-given first name and surname from applying for credit or pursuing an application or a birth-given first name and a combined surfor credit. name. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

764 Federal Reserve Bulletin • November 1975 SECTION 202.5— decree; the length of time the payments have been received; the regularity of receipt; the availability EVALUATION OF APPLICATIONS of procedures to compel payment; and the creditworthiness of the payor, including the credit his- (a) Continued ability to repay. Except as othtory of the payor where available to the creditor erwise provided in this section, a creditor may under the Fair Credit Reporting Act or other aprequest and consider any information concerning plicable laws. the probable continuity of an applicant's ability to repay if such information is requested and (e) Discounting income. A creditor shall not considered without regard to sex or marital status. discount the income of an applicant or an appli- (b) Information about a spouse or former cant's spouse on the basis of sex or marital status. spouse. A creditor shall not discount income solely be- (1) A creditor may request and consider any cause it is derived from part-time employment, but information concerning an applicant's spouse (or may consider the probable continuity of such informer spouse under (iv) below) which may be come in evaluating the creditworthiness of an applicant. considered about the applicant if: (i) the spouse will be permitted to use the (f) Credit scoring. A creditor shall not take sex account; or or marital status into account in a credit scoring (ii) the spouse will be contractually liable system or other method of evaluating applications. upon the account; or (g) Telephone listing in applicant's name. A (iii) the applicant is relying on community creditor shall not take into account the existence property or the spouse's income as a basis for of a telephone listing in the name of an applicant repayment of the credit requested; or in a credit scoring system or other method of (iv) the applicant is relying on alimony, child evaluating applications. A creditor may take into support or maintenance payments from a spouse account the existence of a telephone in the applior former spouse as a basis for repayment of the cant's home. credit requested. (h) Childbearing. A creditor shall not request (2) A creditor may request the name in which information about birth control practices or childan account is carried if the applicant discloses the bearing intentions or capability. Nor shall a crediaccount in applying for credit. tor consider in evaluating the creditworthiness of (3) Except as permitted in this subsection, a an applicant aggregate statistics or assumptions creditor may not request any information concern- relating to the likelihood of any group of persons ing the spouse or former spouse of an applicant. bearing or rearing children, or for that reason (c) Alimony, child support and maintenance receiving diminished or interrupted income in the obligations. A creditor may ask and consider future. whether and to what extent an applicant is obli- (i) Change of name or marital status. (1) gated to make alimony, child support or mainte- Except as set forth in subsection (2) below, in the nance payments. absence of evidence of inability or unwillingness (d) Alimony, child support and maintenance to repay, a creditor shall not take any of the income. (1) If a creditor first discloses to an following actions with respect to a person who applicant that income from alimony, child support is contractually liable on an existing open end or maintenance payments need not be revealed if account on the basis of a change of name or marital the applicant does not choose to disclose such status: income in applying for credit, a creditor may (i) require a reapplication; or inquire whether any income stated in an applica- (ii) require a change in the terms of the tion is derived from such a source. account; or (2) Where an applicant chooses to disclose ali- (iii) terminate the account. mony, child support or maintenance payments (2) Where open end credit has been granted to under section 202.4(c)(3), a creditor shall consider an applicant based on income which is earned such payments as income to the extent that such solely by the applicant's spouse, a creditor may payments are likely to be consistently made. Fac- require a reapplication on the basis of a change tors which a creditor may consider in determining in marital status. the likelihood of consistent payments include, but (j) Credit history. To the extent that a creditor are not limited to, whether the payments are re- considers credit history in evaluating applicants of ceived pursuant to a written agreement or court similar qualifications for a similar type and amount Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 765 of credit, a creditor shall include, in evaluating 3 Employment: creditworthiness: unemployed temporary or irregular (1) the credit history of accounts designated unable to verify under the requirements of section 202.6 as ac- length of employment 4 Income: counts which the applicant and a spouse are perinsufficient mitted to use or for which both are contractually unable to confirm liable, and, on the applicant's request, any infor- information refused 5 Residence: mation the applicant may present tending to inditoo short a period cate that such history does not accurately reflect temporary the applicant's willingness or ability to repay; and 6 Other (specify) (2) on the applicant's request, the credit history, when available, of any account reported in the name of the applicant's spouse or former SECTION 202.6— spouse which an applicant can demonstrate reflects FURNISHING OF CREDIT INFORMATION accurately the applicant's willingness or ability to repay. (a) Accounts established on or after No- (k) Use and retention of prohibited informa- vember 1, 1976. (1) For every account established tion. A creditor may not use any information on or after November 1, 1976, a creditor shall: prohibited by the Act or this Part in evaluating (i) determine whether the account is one applications. Retention of such information in the which an applicant's spouse, if any, will be percreditor's files does not violate the Act or this Part mitted to use or upon which both spouses will be where such information was obtained: contractually liable, if such accounts are offered (i) from any source prior to June 30, 1976; by the creditor; and or (ii) designate any such account to reflect the (ii) at any time from credit reporting agencies; fact of participation of both spouses. or (2) When furnishing information to consumer (iii) at any time from the applicant or others, reporting agencies or others concerning an account without the specific request of the creditor. designated under this section, a creditor shall re- (1) State property laws. Consideration or ap- port the designation and furnish any information plication of State property laws directly or indi- concerning the account: rectly affecting creditworthiness shall not consti- (i) to consumer reporting agencies, in a mantute discrimination for purposes of this Part. ner which will enable the agencies to provide (m) Notification of action taken and reasons access to information about the account in the for denial. (1) A creditor shall, within a reason- name of each spouse; and able time after receiving an application, notify the (ii) to recipients other than such agencies, in applicant of action taken upon the application. the name of each spouse. (2) A creditor shall provide each applicant who (b) Accounts established prior to November is denied credit or whose account is terminated 1, 1976. (1) With respect to any account estabthe reasons for such action, if the applicant so lished prior to and in existence on November 1, requests. 1976, a creditor shall either: (3) A creditor may design its own form or (i) not later than November 1, 1976, determethods to satisfy this requirement. An example mine whether the account is one which an appliof a possible form is set forth below. cant's spouse, if any, is permitted to use or upon which both spouses are contractually liable; designate any such account to reflect the fact of participation of both spouses; and comply with the STATEMENT OF REASONS FOR DENIAL OR TERMINATION OF CREDIT requirements of subsection (a)(2) above; or (ii) mail or deliver to all applicants, or all 1 Credit application: not completed married applicants, in whose name the account is lack of credit references carried on the creditor's records the notice set forth credit reference too new to check 2 Information furnished by: below. Such notice may be mailed with a state- XYZ Credit Bureau ment or other mailing. All such notices shall be 10 Main Street mailed by February 1, 1977. With respect to open Any town, Any state 00000 Phone no. 000-000-0000 end accounts, this requirement may be satisfied Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

766 Federal Reserve Bulletin • November 1975 by mailing a notice to all accounts for which any (2) After November 1, 1976, a creditor shall, statement is sent between November 1, 1976 and within 90 days of receipt of a request to change February 1, 1977. A creditor may supplement the the manner in which information is reported to notice as necessary to permit identification of the consumer reporting agencies and others, when account. furnishing information concerning any such account, designate the account to reflect the fact of NOTICE participation of both spouses. The creditor shall CREDIT HISTORY FOR MARRIED PERSONS report the designation and furnish any information The Federal Equal Credit Opportunity Act for- concerning the account to any recipient other than bids all creditors from discriminating against any a consumer reporting agency in the name of each applicant on the basis of sex or marital status in spouse and, when reporting to consumer reporting any aspect of a credit transaction. Regulations agencies, in a manner which will enable such adopted under the Act give married persons the agencies to provide access to information about right to have credit information concerning those the account in the name of each spouse. credit accounts that they hold or use jointly with (3) A spouse's signature on a request to change a spouse reported to consumer reporting agencies the manner in which information concerning an and creditors in the names of both the wife and account is furnished shall not change the legal husband. Accounts of married persons opened liability of either spouse upon the account. before November 1976—even those opened in the names of both spouses—are often reported in only the husband's name. This is generally true regardless of who has been paying the bills or whose income was used to obtain the account. As a result, SECTION 202.7—REQUEST FOR many married women do not have a credit history SIGNATURE OF SPOUSE OR OTHER PERSON in their own names, although their husbands do. (a) General. Except as provided in subsections If a woman ever needs to obtain credit on her own, (b) and (c) below, a creditor may not require the for example, when divorced or widowed, a credit signature of a spouse or other person on a credit history is usually necessary. instrument unless such a requirement is imposed If your account(s) with us is a joint account without regard to sex or marital status on all which you share with your spouse or an account(s) similarly qualified applicants who apply for a simin the name of one spouse which the other spouse ilar type and amount of credit. is authorized to use, you have the right to have (b) Unsecured credit in community property credit information concerning it reported in both States. Where a married applicant applies for your name and your spouse's name. If you choose unsecured credit in a community property State, to have credit information concerning your aca creditor may request or require the signature of counts) with us reported in both your name and a non-applicant spouse if: the name of your spouse, please fill in the state- (i) the applicable State law denies the appliment below and return it to us. cant power to manage or control sufficient com- Please note that the Federal regulation provides munity property to qualify for the amount of credit that your signature below will not make either you requested under the creditor's standards of creditor your spouse legally liable for any different or worthiness; and greater debts. It will only request that credit infor- (ii) the applicant does not have sufficient mation be reported in both your names. separate property to qualify for the amount of credit requested without regard to any community When you furnish credit information on this property. account, please report all information concerning (c) Signatures on certain instruments. Where it in both our names as follows: a married or separated applicant applies for secured credit, the creditor may require the signature of the applicant's spouse on such instruments as (print or type) are necessary, under the applicable statutory or decisional law of the State, or are reasonably Account Number (print or type) believed by the creditor to be so necessary, to (if any) create a valid lien, pass clear title, waive inchoate Signature of either spouse rights to property or assign earnings. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 767 SECTION 202.8—SEPARATE this Part, or which has been served with notice ACCOUNTS IN RELATION TO STATE LAW of an action filed pursuant to Section 202.13 of this Part, shall retain the information required in (a) Separate extension of consumer credit. subsections (a) and (b) above until final disposition Any provision of State law which prohibits the of the matter or such earlier time as may be ordered separate extension of consumer credit to each by the agency or court. spouse shall not apply in any case where each spouse voluntarily applies for separate credit from SECTION 202.10— the same creditor. In any case where such a State CERTAIN SPECIALIZED CREDIT law is pre-empted, each spouse shall be solely responsible for the debt so contracted. (a) General. Each type of credit referred to in (b) Finance charges and loan ceilings. When subsection (b), (c), (d), and (e) below shall be each spouse separately and voluntarily applies for subject only to section 202.1, the General Rule and obtains a separate account with the same stated in section 202.2, to sections 202.3, creditor, the accounts shall not be aggregated or 202.4(a), 202.4(b), 202.4(e), 202.11, 202.12, otherwise combined for purposes of determining 202.13 and 202.14, and to the other provisions, permissible finance charges or permissible loan if any, specified in the applicable subsections of ceilings under the laws of any State or of the this section. If a credit falls within more than one United States. Permissible loan ceilings under the subsection of this section, all sections of this Part laws of any State or of the United States shall referred to in any such subsections shall apply be construed to permit each spouse to be separately unless the credit falls within subsection (d), in and individually liable up to the amount of the which case only the provisions specified in that loan ceiling less the amount for which both subsection and this subsection (a) shall apply. spouses are jointly liable. For example, in a State (b) Incidental credit. Incidental credit shall be with a permissible loan ceiling of $1,000, if a subject to the provisions specified in sections married couple were jointly liable for $250, each 202.10(a) and 202.5(h). As used in this Part, spouse could subsequently become individually incidental credit is credit which meets all of the liable for $750. following requirements: (1) the credit is not represented by and does SECTION 202.9—PRESERVATION OF RECORDS not arise from the use of a credit card; and (a) For a period ending 15 months after the date (2) no finance charge as defined in section 226.4 a creditor gives the applicant notice of action on of this Title (12 CFR 226.4 of Regulation Z), late an application, the creditor shall retain as to each payment or other fee is or may be imposed other applicant, in original form or a copy thereof: than statutory interest or other costs recoverable (1) any application form and all other written in legal proceedings for the collection of the credit; or recorded information used in evaluating an and application; and (3) there is no agreement by which the credit (2) any written statement submitted by the ap- may be payable in more than four instalments. plicant alleging discrimination prohibited by the (c) Business credit. Business credit shall be Act or this Part. subject to the provisions specified in sections (b) For a period ending 15 months after the date 202.10(a), 202.5 and 202.7. Section 202.9 shall a creditor adversely changes the terms or condi- only apply in those transactions involving an aptions of credit for an account, the creditor shall plication for credit in the amount of $100,000 or retain as to each account, in original form or a less where the applicant requests in writing that copy thereof: the creditor retain such records. A creditor shall (1) any written or recorded information con- not, on the basis of sex or marital status, fail to cerning such change in the terms and conditions; act on, or unreasonably delay a decision on, an and application for business credit. As used in this (2) any written statement submitted by the ap- Part, business credit is credit granted for business, plicant alleging discrimination prohibited by the commercial or agricultural purposes. Act or this Part. (d) Securities credit. Securities credit shall be (c) Any creditor which has actual notice that subject to the provisions specified in section it is under investigation for violation of this Part 202.10(a), sections 202.5(a), 202.5(c) through by an enforcement agency charged with monitor- 202.5(h), 202.5(j), 202.5(1), 202.6(a) and 202.9. ing that creditor's compliance with the Act and Section 202.4(e) shall not apply to a securities Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

768 Federal Reserve Bulletin • November 1975 dealer insofar as the action described is taken to ance Corporation, Federal Home Loan Bank Board prevent violation of rules regarding an account in acting directly or through the Federal Savings and which a broker or dealer has an interest, or rules Loan Insurance Corporation, Administrator of the necessitating the aggregating of accounts of National Credit Union Administration, Interstate spouses for the purpose of determining controlling Commerce Commission, Civil Aeronautics Board, interests, beneficial ownership or purchase limita- Secretary of Agriculture, Farm Credit Administrations and restrictions. As used in this Part, securi- tion, Securities and Exchange Commission and the ties credit is credit subject to regulation under Small Business Administration. section 7 of the Securities Exchange Act of 1934 (b) Except to the extent that administrative enor credit extended by a broker or dealer who is forcement is specifically committed to other ausubject to regulation as a broker or dealer under thorities, Section 704 of the Act assigns enforcethe Securities Exchange Act of 1934. ment of the Act and this Part to the Federal Trade Commission. (e) Public utilities credit. Public utilities credit SECTION 202.13— shall be subject to the provisions specified in PENALTIES AND LIABILITIES section 202.10(a) and to sections 202.5 and 202.7. As used in this Part, public utilities credit is credit (a) Sections 706(a) through (e) of the Act proextended pursuant to transactions under public vide for civil liability for actual and punitive utility tariffs involving services provided through damages against any creditor who fails to comply pipe, wire or other connected facilities, if the with the Act and this Part. Section 706(b) places charges for such public utility services, the charges a $10,000 limitation on the amount of punitive for delayed payment and any discount allowed for damages an aggrieved applicant may seek in an early payment are filed with, reviewed by or regu- individual capacity and Section 706(c) limits a lated by an agency of the Federal Government, creditor's class action liability for punitive dama State or a political subdivision thereof. ages to the lesser of $100,000 or 1% of the creditor's net worth at the time the action is SECTION 202.11— brought. Section 706(d) provides that an aggrieved MISCELLANEOUS PROVISIONS applicant may seek equitable relief in the nature (a) Mechanical errors. If a failure to comply of a permanent or temporary injunction, restrainwith sections 202.4(d), 202.5(j), 202.5(m) or ing order or other action. Section 706(e) further 202.6 results from a mechanical, electronic or provides for the awarding of costs and reasonable clerical error made in good faith, it shall not be attorney's fees to an aggrieved applicant who a violation of the section if the creditor shows by brings a successful action under Sections 706(a) a preponderance of the evidence that at the time through (d). of the noncompliance the creditor had established (b) Section 706(f) relieves a creditor from civil and was maintaining suitable procedures to assure liability resulting from any act done or omitted compliance with the section. in good faith in conformity with any rule, regula- (b) Inconsistent State laws. Except as pro- tion or interpretation by the Board of Governors vided in section 202.8, this Part alters, affects or of the Federal Reserve System notwithstanding preempts only those State laws which are incon- that after such act or omission has occurred, such sistent with this Part, and then only to the extent rule, regulation or interpretation is amended, reof the inconsistency. Such a State law is not scinded or otherwise determined to be invalid for inconsistent with this Part if the creditor can any reason. comply with the State law without violating this (c) Without regard to the amount in contro- Part. versy, any action under this Title may be brought in any United States district court or in any other SECTION 202.12— court of competent jurisdiction, within one year ADMINISTRATIVE ENFORCEMENT from the date of the occurrence of the violation. (a) As set forth more fully in Section 704 of SECTION 202.14—TRANSITION PERIODS the Act, administrative enforcement of the Act and this Part with respect to certain creditors is as- Except as provided in section 202.6 with respect signed to the Comptroller of the Currency, Board to that section, the provisions of this Part shall of Governors of the Federal Reserve System, take effect as follows: Board of Directors of the Federal Deposit Insur- (a) Sections 202.1, 202.2, 202.3, 202.4(a), Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 769 202.5(a), (c), (h), (j), (k), (1), 202.7(c), 202.8, of 180 days or more but less than 4 years; 3 per 202.9(c), 202.10, 202.11, 202.12, 202.13 and cent of its time deposits up to $5 million, out- 202.14 shall take effect on October 28, 1975. standing on or issued after October 16, 1975, that (b) Sections 202.4(b) and (e), 202.5(d), (e), (f) have an initial maturity of less than 180 days, plus and (g) and 202.9(a) and (b) and 202.14(b) shall 6 per cent of such deposits in excess of $5 million. take effect on November 30, 1975. Provided, however, that in no event shall the (c) Sections 202.5(i) and (m) and 202.7(a) and reserves required on its aggregate amount of time (b) shall take effect on January 31, 1976. and savings deposits be less than 3 per cent. (d) Sections 202.4(c) and (d) and 202.5(b) shall take effect on June 30, 1976. RESERVES OF MEMBER BANKS INTEREST ON DEPOSITS RESERVES OF MEMBER BANKS The Board of Governors has amended its Regu- The Board of Governors has amended its Regulations D and Q to permit member banks to classify lation D to reduce from three per cent to one per funds of business organizations as savings deposits cent the reserve balances member banks are reup to a maximum of $150,000 per depositor. quired to maintain on time deposits with an initial maturity of four years or more. AMENDMENTS TO REGULATIONS D AND Q AMENDMENT TO REGULATION D Effective October 16, 1975, sections Effective November 10, 1975, sections 204.1(e) 204.5(a)(l)(ii) and 204.5(a)(2)(ii) are amended to and 217.1(e) are amended as follows: read as follows: SECTION 204.1—DEFINITIONS SECTION 204.5—RESERVE REQUIREMENTS (a) (e) Savings deposits. The term "savings de- (1) If not in a reserve city— posit" means a deposit—(1) that consists of funds deposited to the credit of or in which the entire (ii) 1 per cent of its time deposits outstanding beneficial interest is held by one or more individon or issued after October 16, 1975, that have uals, or of a corporation, association, or other an initial maturity of 4 years or more; 3 per cent organization operated primarily for religious, of its time deposits outstanding on or issued after philanthropic, charitable, educational, fraternal, or October 16, 1975, that have an initial maturity other similar purposes and not operated for profit;4 of 180 days or more but less than 4 years; 3 per or that consists of funds deposited to the credit cent of its time deposits up to $5 million, out- of or in which the entire beneficial interest is held standing on or issued after October 16, 1975, that by the United States, any State of the United have an initial maturity of less than 180 days, plus States, or any county, municipality, or political 6 per cent of such deposits in excess of $5 million. subdivision thereof, the District of Columbia, the Provided, however, that in no event shall the Commonwealth of Puerto Rico, the Virgin Islands, reserves required on its aggregate amount of time American Samoa, Guam, or political subdivision and savings deposits be less than 3 per cent. thereof; or that consists of funds deposited to the credit of, or in which any beneficial interest is held by a corporation, association, or other organization (2) If in a reserve city (except as to any bank not qualifying above to the extent such funds do located in such a city that is permitted by the Board not exceed $150,000 per such depositor at a of Governors of the Federal Reserve System, pur- member bank;4a and suant to § 204.2(a)(2), to maintain the reserves specified in subparagraph (1) of this paragraph)— 4 Deposits in joint accounts of two or more individuals may be classified as savings deposits if they meet the other require- (ii) 1 per cent of its time deposits outstanding ments of the above definition. Deposits of a partnership operated for profit may also be classified as savings to the on or issued after October 16, 1975, that have extent such deposits do not exceed $150,000 per partnership an initial maturity of 4 years or more; 3 per cent at a member bank. of its time deposits outstanding on or issued after 4aWhere a deposit is to the credit of the bank's own trust department and the funds involved are utilized to cover checks, October 16, 1975, that have an initial maturity such deposit may not be classified as a savings deposit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

770 Federal Reserve Bulletin • November 1975 change Act of 1934 (15 U.S.C. 78) (the "Act'1) SECTION 217.1 —DEFINITIONS and applies to all securities subject to registration * * * ** pursuant to section 12(b) or section 12(g) of the (e) Savings deposits. The term ''savings de- Act by a bank that is organized under State law posit" means a deposit—(1) that consists of funds and is a member of the Federal Reserve System deposited to the credit of or in which the entire ("bank"). beneficial interest is held by one or more individuals, or of a corporation, association, or other SECTION 206.2—DEFINITIONS organization operated primarily for religious, philanthropic, charitable, educational, fraternal, or For the purposes of this Part, including all other similar purposes and not operated for profit;4 forms and instructions promulgated for use in or that consists of funds deposited to the credit connection herewith, unless the context otherwise of or in which the entire beneficial interest is held requires: by the United States, any State of the United (a) The terms "exchange", "director", States, or any county, municipality, or political "person", "security", and "equity security" subdivision thereof, the District of Columbia, the have the meanings given them in section 3(a) of Commonwealth of Puerto Rico, the Virgin Islands, the Act.1 American Samoa, Guam, or political subdivision (b) The term "affiliate" (whether referred to thereof ; or that consists of funds deposited to the as an "affiliate" of, or a person "affiliated" with, credit of, or in which any beneficial interest is held a specified person) means a person that directly, by a corporation, association, or other organization or indirectly through one or more intermediaries, not qualifying above to the extent such funds do controls, or is controlled by, or is under common not exceed $150,000 per such depositor at a control with, the person specified. member bank; and (c) The term "amount", when used with respect to securities, means the principal amount if * * * ** relating to evidences of indebtedness, the number of shares if relating to shares, and the number of 4 Deposits in joint accounts of two or more individuals may units if relating to any other kind of security. be classified as savings deposits if they meet the other require- (d) The term "associate", when used to indiments of the above definition. Deposits of a partnership operated for profit may also be classified as savings to the cate a relationship with any person, means (1) any extent such deposits do not exceed $150,000 per partnership corporation or organization (other than the bank at a member bank. or a majority-owned subsidiary of the bank) of which such person is an officer or partner or is, SECURITIES OF directly or indirectly, either alone or together with MEMBER STATE BANKS one or more members of his immediate family, the beneficial owner of 10 per cent or more of The Board of Governors has revised its Regulaany class of equity securities, (2) any trust or tion F governing Securities of Member State other estate in which such person has a substantial Banks to make it substantially similar to comparabeneficial interest or as to which such person ble rules and regulations issued by the Securities serves as trustee or in a similar fiduciary capacity, and Exchange Commission. and (3) any relative or spouse of such person, or any relative of such spouse, who has the same REVISED REGULATION F home as such person, or who is a director or officer of the bank or any of its parents or subsidi- Effective December 1, 1975, section 206 is aries. revised to read as follows: (e) The term "charter" includes articles of in- SECTION 206.1—SCOPE OF PART* corporation, declarations of trust, articles of association or partnership, or any similar instrument, This Part is issued by the Board of Governors as amended, effecting (either with or without filof the Federal Reserve System (the "Board") ing with any governmental agency) the organipursuant to section 12(i) of the Securities Ex- zation or creation of an incorporated or unincorporated person. *This text corresponds to the Code of Federal Regulations, Title 12, Chapter II, Part 206, cited as 12 CFR 206. The 'See Appendix of Regulation F published by the Board of words "this Part", as used herein, mean Regulation F. Governors of the Federal Reserve System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 64 (f) The term "control" (including the terms (2) Notwithstanding subparagraph (1): "controlling", "controlled by1', and "under (i) Securities held subject to a voting trust, common control with") means the possession, di- deposit agreement, or similar arrangement shall rectly or indirectly, of the power to direct or be included as held of record by the record holdcause the direction of the management and poli- ers of the voting trust certificates, certificates of cies of a person, whether through the ownership deposit, receipts, or similar evidences of interest of voting securities, by contract, or otherwise. that the bank may rely in good faith on such in- (g) The term "employee" does not include a formation as is received in response to its request director, trustee, or officer. from a nonaffiliated issuer of the certificates or in- (h) The term "equity capital accounts" means terests. capital stock, surplus, undivided profits, and re- (ii) If the bank knows or has reason to know serve for contingencies and other capital reserves. that the form of holding securities of record is (i) The term "fiscal year" means the annual used principally to circumvent the provisions of accounting period or, if no closing date has been section 12(g) (1) of the Act, the beneficial owners adopted, the calendar year ending on December of such securities shall be deemed to be record 31. owners thereof. (j) (1) For the purpose of determining whether (k) The term "immediate family" includes a the registration requirements of section 12(g)(1) person's (1) spouse; (2) son, daughter, and deof the Act are applicable, securities shall be scendant of either; (3) father, mother, and ancesdeemed to be "held of record" by each person tor of either; (4) stepson and stepdaughter; and who is identified as the owner of such securities (5) stepfather and stepmother. For the purpose of on records of security holders maintained by or determining whether any of the foregoing relaon behalf of the bank, subject to the following: tionships exist, a legally adopted child shall be (i) In any case where the records of security considered a child by blood. holders have not been maintained in accordance (0 The term "information statement" means with accepted practice, any additional person who the statement required by § 206.5(a), whether or would be identified as such an owner on such not contained in a single document. records if they had been maintained in accordance (m) The term "last fiscal year" of bank means with accepted practice shall be included as a the last fiscal year of bank ending prior to the date holder of record. of the meeting with respect to which an informa- (ii) Securities identified as held of record by tion statement is required to be distributed. a corporation, a partnership, a trust, whether or (n) The term "listed" means admitted to full not the trustees are named, or other organization trading privileges upon application by the bank shall be included as so held by one person. and includes securities for which authority to add (iii) Securities identified as held of record by to the list on official notice of issuance has been one or more persons as trustees, executors, guar- granted. dians, custodians, or in other fiduciary capacities (o) The term "majority-owned subsidiary" with respect to a single trust, estate, or account means a subsidiary more than 50 per cent of shall be included as held of record by one person. whose outstanding securities representing the (iv) Securities held by two or more persons right, other than as affected by events of default, as co-owners shall be included as held by one per- to vote for the election of directors, is owned by son. the subsidiary's parent and/or one or more of the (v) Each outstanding unregistered or bearer parent's other majority-owned subsidiaries. certificate shall be included as held of record by (p) The term "material", when used to qualify a separate person, except to the extent that the a requirement for furnishing of information as to bank can establish that, if such securities were any subject, limits the information required to registered, they would be held of record, under those matters as to which an average prudent inthe provisions of this paragraph (j), by a lesser vestor ought reasonably to be informed before number of persons. buying or selling the security registered. (vi) Securities registered in substantially sim- (q) The term "officer" means a Chairman of ilar names, where the bank has reason to believe the Board of Directors, Vice Chairman of the because of the address or other indications that Board, Chairman of the Executive Committee, such names represent the same person, may be President, Vice President (except as indicated in included as held of record by one person. the next sentence), Cashier, Treasurer, Secretary, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

772 Federal Reserve Bulletin • November 1975 Comptroller, and any other person who partici- consent, or authorization within the meaning of pates in major policymaking functions of the section 14(a) of the Act. The consent or authoribank. In some banks (particularly banks with of- zation may take the form of failure to object or ficers bearing titles such as Executive Vice Pres- to dissent. ident, Senior Vice President, or First Vice Pres- (z) The term "proxy statement" means the ident as well as a number of "Vice Presidents"), statement required by § 206.5 (a), whether or not some or all "Vice Presidents" do not participate contained in a single document. in major policymaking functions, and such per- (aa) The terms "qualified stock option", "resons are not officers for the purpose of this Part. stricted stock option", and "employee stock (r) The term "option" means any option, war- purchase plan" have the meanings given them rant, or right other than those issued to security in sections 422 through 424 of the Internal Reveholders on a pro rata basis. nue Code of 1954, as amended. For the purposes (s) The term "parent" of a specified person of this Regulation, an option which meets all of is a person controlling such person directly, or in- the conditions of section 424(b) of the Internal directly through one or more intermediaries. Revenue Code of 1954, as amended, other than (t) The term "plan" includes all plans, con- the date of issuance shall be deemed to be a "retracts, authorizations, or arrangements, whether stricted stock option". or not set forth in any formal document. (bb) The term "registration statement" or (u) The term "predecessor" means a person "statement", when used with reference to registhe major portion of the business and assets of tration pursuant to § 206.4 of this Part, includes which another person acquired in a single succes- both an application for registration of securities sion or in a series of related successions. on a national securites exchange pursuant to sec- (v) The terms "previously filed" and "pre- tion 12(b) of the Act and a registration statement viously reported" mean previously filed with, or filed pursuant to section 12(g) of the Act. reported in, a registration statement under section (cc) The term "share" means a share of stock 12, a report under section 13, or a definitive in a corporation or unit of interest in an unincorproxy statement or statement where management porated person. does not solicit proxies under section 14 of the (dd) The term "significant subsidiary" means Act, which statement or report has been filed with a subsidiary meeting any of the following condithe Board, except that information contained in tions: any such document shall be deemed to have been (1) The investments in the subsidiary by its previously filed with or reported to an exchange parent plus the parent's proportion of the investonly if such document is filed with such ex- ments in such subsidiary by the parent's other change. subsidiaries, if any, exceed 5 per cent of the eq- (w) The term "principal underwriter" means uity capital accounts of the bank. "Investments" an underwriter in privity of contract with the bank refers to the amount carried on the books of the of the securities as to which he is underwriter. parent and other subsidiaries or the amount equiv- (x) The term "promoter" includes: (1) any alent to the parent's proportionate share in the eqperson who, acting alone or in conjunction with uity capital accounts of the subsidiary, whichever one or more other persons, directly or indirectly is greater; or takes initiative in founding and organizing the (2) The parent's proportion of the gross operatbank; (2) any person who, in connection with the ing revenues of the subsidiary exceeds 5 per cent founding and organizing of the bank, directly or of the gross operating revenues of the parent and indirectly receives in consideration of services or its consolidated subsidiaries; or property or both services and property 10 per cent (3) The parent's proportion of income of the or more of any class of securities of the bank or subsidiary before income taxes exceeds 5 per cent 10 per cent or more of the proceeds from the sale or more of the income before income taxes of the of any class of such securities. A person who re- parent and its consolidated subsidiaries, provided ceives such securities or proceeds either solely as that if such income of the parent and its consoliunderwriting commissions or solely in consid- dated subsidiaries is at least 5 per cent lower than eration of property shall not, however, be deemed the average of such income for the last five fiscal a promoter if such person does not otherwise take years such average income may be substituted in part in founding and organizing the bank. the determination. (y) The term "proxy" includes every proxy, (See NOTE on following page.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 773 NOTE.—The subsidiary may be the parent of one or more (jj) The terms "beneficial ownership", "bensubsidiaries and, together with such subsidiaries may, if con- eficially owned", and the like, when used with sidered in the aggregate, constitute a significant subsidiary. respect to the reporting of ownership of the (ee) The terms "solicit" and "solicitation" bank's equity securities in any statement or report means (1) any request for a proxy whether or not required by this Part, shall include, in addition accompanied by or included in a form of proxy; to direct and indirect beneficial ownership by the (2) any request to execute or not to execute, or reporting person, ownership of such securities (1) to revoke, a proxy; or (3) the furnishing of a form by the spouse (except where legally separated) of proxy or other communication to security holdand minor children of such reporting person, and ers under circumstances reasonably calculated to (2) by any other relative of the reporting person result in the procurement, withholding, or revocawho has the same home as such person. tion of a proxy. The terms do not apply, however, to the furnishing of a form of proxy to a security SECTION 206.3— holder upon the unsolicited request of such secu- INSPECTION AND PUBLICATION rity holder, the performance by the bank of acts OF INFORMATION FILED UNDER THE ACT required by § 206.5(g), or the performance by any person of ministerial acts on behalf of a per- (a) Filing of material with the Board. All son soliciting a proxy. papers required to be filed with the Board pursu- (ff) A "subsidiary" of a bank is (1) an affiliate ant to the Act or regulations thereunder shall be controlled by the bank, directly or indirectly, filed at its office in Washington, D.C. Material through one or more intermediaries, except where may be filed by delivery to the Board, through the control (i) exists by reason of ownership or the mails, or otherwise. The date on which papers control of voting securities by the bank in a fidu- are actually received by the Board shall be the ciary capacity, or (ii) was obtained by the bank date of filing thereof if all of the requirements in the course of securing or collecting a debt pre- with respect to the filing have been complied viously contracted in good faith, or (2) a person with. a majority of whose voting securities are held in (b) Inspection. Except as provided in paratrust for the benefit of the holders of a class of graph (c) of this section, all information filed, stock of the bank pro rata. other than ownership reports required to be filed (gg) The term "succession" means the direct pursuant to § 206.6(a), regarding a security regisacquisition of the shares or assets comprising a tered with the Board will be available for inspecgoing business, whether by merger, consoli- tion at the Federal Deposit Insurance Corporation, dation, purchase, or other direct transfer. The 550 Seventeenth Street, NW, Washington, D.C. term does not include the acquisition of control In addition, copies of the registration statement of a business unless followed by the direct acqui- and reports required by § 206.4 (exclusive of exsition of its shares or assets. The term "succeed" hibits), the statements required by § 206.5(a), and and "successor" have meanings correlative to the the annual reports to security holders required by foregoing. § 206.5(c), will be available for inspection at the (hh) The term "verified", when used with re- New York, Chicago, and San Francisco Federal spect to financial statements, means either (1) cer- Reserve Banks and at the Reserve Bank of the tified by an independent public accountant, or (2) district in which the bank filing the statements or signed in accordance with § 206.7(b) (2) by the reports is located. The ownership reports required person principally responsible for the accounting to be filed pursuant to § 206.6(a) will be available records of the bank (the "principal accounting of- for public inspection at the Board's office in ficer") and by the person principally responsible Washington, D.C. for the audit procedures of the bank (the "audi- (c) Nondisclosure of certain information tor"); except that the term "verified" shall mean filed. Any person filing any statement, report, or certified by an independent public accountant in document under the Act may make written objecany case in which the Board so informs the bank tion to the public disclosure of any information concerned, in writing, at least 90 days prior to contained therein in accordance with the procethe end of the fiscal year to which the financial dure set forth below: statements will relate. (1) The person shall omit from the statement, (ii) The term "voting securities" means se- report, or document, when it is filed, the portion curities the holders of which are presently entitled thereof that it desires to keep undisclosed (hereinto vote for the election of directors. after called the confidential portion). In lieu Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

774 Federal Reserve Bulletin • November 1975 thereof, it shall indicate at the appropriate place dispatch of notice by registered or certified mail in the statement, report, or document that the con- of the finding and determination of the Board defidential portion has been so omitted and filed scribed in paragraph (c)(5) of this section, if prior separately with the Board. to the lapse of such 15 days the person shall not (2) The person shall file with the copies of the have filed a written statement that he intends in statement, report, or document filed with the good faith to seek judicial review of the finding Board: and determination; (i) As many copies of the confidential por- (ii) upon the lapse of 60 days after the tion, each clearly marked "CONFIDENTIAL dispatch of notice by registered or certified mail TREATMENT", as there are copies of the state- or the finding and determination of the Board, if ment, report, or document filed with the Board the statement described in clause (i) shall have and with each exchange, if any. Each copy shall been filed and if a petition for judicial review contain the complete text of the item and, not- shall not have been filed within such 60 days; or withstanding that the confidential portion does not (iii) if such petition for judicial review shall constitute the whole of the answer, the entire an- have been filed within such 60 days upon final swer thereto; except that in case the confidential disposition, adverse to the person, of the judicial portion is part of a financial statement or sched- proceedings. ule, only the particular financial statement or (7) If the confidential portion is made available schedule need be included. All copies of the con- to the public, a copy thereof shall be attached to fidential portion shall be in the same form as the each copy of the statement, report, or document remainder of the statement, report, or document. filed with the Board and with each exchange con- (ii) An application making objection to the cerned. disclosure of the confidential portion. Such application shall be on a sheet or sheets separate from the confidential portion, and shall contain (A) an SECTION 206.4— identification of the portion of the statement, re- REGISTRATION STATEMENTS AND REPORTS port, or document that has been omitted, (B) a (a) Requirement of registration statement. statement of the grounds of objection, and (C) the Securities of a bank shall be registered under the name of each exchange, if any, with which the provisions of either section 12(b) or section 12(g) statement, report, or document is filed. The of the Act by filing a statement in conformity with copies of the confidential portion and the applicathe requirements of Form F-1, Form F-1B (in the tion filed in accordance with this subparagraph case of registration of securities of a successor shall be enclosed in a separate envelope marked bank), or Form F-10 (in the case of registration "CONFIDENTIAL TREATMENT" and adof an additional class of securities). No registration dressed to Secretary, Board of Governors of the shall be required under the provisions of section Federal Reserve System, Washington, D.C. 12(b) or section 12(g) of the Act of any warrant 20551. or certificate evidencing a right to subscribe to or (3) Pending the determination by the Board as otherwise acquire a security of a bank if such to the objection filed in accordance with para- warrant or certificate by its terms expires within graph (c)(2) of this section, the confidential por- 90 days after the issuance thereof. tion will not be disclosed by the Board. (1) Where in connection with a succession by (4) If the Board determines that the objection merger, consolidation, exchange of securities or shall be sustained, a notation to that effect will acquisition of assets, equity securities of a bank, be made at the appropriate place in the statement, not previously registered pursuant to section 12 report, or document. of the Act, are issued to the holders of any class (5) If the Board shall have determined that dis- of equity securities of another bank which is regclosure of the confidential portion is in the public istered pursuant to section 12(g), the class of interest, a finding and determination to that effect securities so issued shall be deemed to be regiswill be entered and notice of the finding and de- tered pursuant to section 12(g) of the Act unless termination will be sent by registered or certified upon consummation of the succession such class mail to the person. is exempt from such registration or all securities (6) The confidential portion shall be made of such class are held of record by less than 300 available to the public: persons. (i) upon the lapse of 15 days after the (2) Where in connection with a succession by Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 775 merger, consolidation, exchange of securities or certification approving a security for listing and acquisition of assets, equity securities of a bank, registration shall be the date on which the certifiwhich are not registered pursuant to section 12 cation is actually received by the Board or the date of the Act, are issued to the holders of any class on which the registration statement to which the of equity securities of another bank which is re- certification relates is actually received by the quired to file a registration statement pursuant to Board, whichever date is later. section 12(g) but has not yet done so, the duty (5) If an amendment to the registration statement to file such statement shall be deemed to have been is filed with the exchange and with the Board after assumed by the bank whose class of securities is the receipt by the Board of the certification of the so issued and such bank shall file a registration exchange approving the security for listing and statement pursuant to section 12(g) of the Act with registration, the certification, unless withdrawn, respect to such class within the period of time the shall be deemed made with reference to the statepredecessor bank would have been required to file ment as amended. such a statement, or within such extended period (6) An exchange may, by notice to the Board, of time as the Board may authorize upon applica- withdraw its certification prior to the time that the tion pursuant to § 206.4(r), unless upon consum- registration to which it relates first becomes effecmation of the succession such class is exempt from tive pursuant to paragraph (b) of this section. such registration or all securities of the class are (7) An exchange may suspend from trading a held of record by less than 300 persons. bank security listed and registered thereon in ac- (b) Registration effective as to class or series. cordance with its rules. Suspension of trading shall Depending upon whether the security is to be listed not terminate the registration of any bank security. on an exchange, registration shall become effec- (e) Requirement of annual reports. (1) Every tive as provided in section 12(d) or section 12(g) registrant bank shall file an annual report for each (1) of the Act as to the entire class of such security, fiscal year after the last full fiscal year for which then or thereafter authorized. If, however, a class financial statements were filed with the registration of security is issuable in two or more series with statement. The report, which shall conform to the different terms, each such series shall be deemed requirements of Form F-2, shall be filed within a separate class for the purposes of this paragraph. 90 days after the close of the fiscal year or within (c) Acceleration of effectiveness of regis- 30 days of the mailing of the bank's annual report tration. A request for acceleration of the effective to stockholders, whichever occurs first. date of registration shall be made in writing by (2) Every bank which changes its fiscal closing either the bank, an exchange, or both and shall date after the last fiscal year for which financial briefly describe the reasons therefor. statements were filed in a Form F-l or Form F-2 (d) Exchange certification. (1) Certification shall file a report on Form F-2 covering the resultthat a security has been approved by an exchange ing interim period not more than 120 days after for listing and registration pursuant to section the close of the interim period or after the date 12(d) of the Act shall be made by the governing of the determination to change the fiscal closing committee or other corresponding authority of the date, whichever is later. A separate report, howexchange. ever, need not be filed for any period of less than (2) The certification shall specify (i) the ap- three months if the Form F-2 filed for the sucproval of the exchange for listing and registration; ceeding full fiscal year covers the interim period (ii) the title of the security so approved; (iii) the as well as the fiscal year. In such case, balance date of filing with the exchange of the registration sheets need be furnished only as of the close of statement and of any amendments thereto; and (iv) the entire period but all other financial statements any conditions imposed on such certification. The and schedules shall be filed separately for both exchange shall promptly notify the Board of the periods. partial or complete satisfaction of any such condi- (f) Annual reports of predecessors. Every tions. bank having securities registered pursuant to sec- (3) The certification may be made by telegram tion 12 of the Act on Form F-l (or Form F-10, but in such case shall be confirmed in writing. in the case of registration of an additional class All certifications in writing and all amendments of securities) shall file an annual report pursuant thereto shall be filed with the Board in duplicate to paragraph (e) of this section for each of its and at least one copy shall be manually signed predecessors which had securities registered purby the appropriate exchange authority. suant to section 12 covering the last full fiscal year (4) The date of receipt by the Board of the of the predecessor prior to the registrant's succes- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

776 Federal Reserve Bulletin • November 1975 sion, unless such report has been filed by the (ii) Acquisitions of securities by a security predecessor. Such annual report shall contain the holder who, prior to such acquisition, was the information that would be required if filed by the beneficial owner of more than 5 per cent of the predecessor. outstanding securities of the same class as those acquired shall be exempt from the reporting re- (g) Exception from requirement for annual quirements of paragraph (h)(3) (i) of this section report. Notwithstanding paragraph (e) of this secif the following conditions are met: tion, any bank that has filed, within the period (A) the acquisition is made pursuant to prescribed for filing an annual report pursuant to preemptive subscription rights in an offering made that paragraph, a registration statement that has to all holders of securities of the class to which become effective and is not subject to any prothe preemptive subscription rights pertain; ceeding under section 15(c) or section 19(a) of (B) the purchaser does not, through the the Act, or to an order thereunder, need not file exercise of such preemptive subscription rights, an annual report if such statement covers the fiscal acquire more than his or its pro rata share of the period that would be covered by such annual report securities offered; and and contains all of the information, including (C) the acquisition is duly reported pursufinancial statements and exhibits, required for anant to section 16(a) of the Act and the provisions nual reports. of § 206.6 promulgated thereunder. (h) Current reports. (1) Every registrant bank (4) If any material change occurs in the facts shall file a current report in conformity with the set forth in the statement required by paragraph requirements of Form F-3 within 10 days after the (h)(3) of this section, the person who filed such close of any month during which any of the events statement shall promptly file with the Board and specified in that form occurs, unless substantially send to the bank and the exchange an amendment the same information as required by that form has disclosing such change. been previously reported by the bank. (5) In determining, for the purposes of § (2) Each bank having securities registered pur- 206.4(h) or § 206.5(1), whether a person is disuant to section 12(g) of the Act, upon being rectly or indirectly the beneficial owner of securinotified by a national securities association regis- ties of any class, such person shall be deemed to tered pursuant to section 15A of the Act, that a be the beneficial owner of securities of such class class of the bank's securities is to be quoted on which such person has the right to acquire through an interdealer quotation system which is sponsored the exercise of presently exercisable options, warand governed by the rules of such association, rants or rights or through the conversion of presshall thereafter notify such association promptly ently convertible securities, or otherwise. The seof (i) any increase or decrease in the amounts of curities subject to such options, warrants, rights securities of such class outstanding which exceeds or conversion privileges held by a person shall be 5 per cent of the amount of such class last reported deemed to be outstanding for the purpose of comto the association and (ii) any change in the name puting the percentage of outstanding securities of of the bank. The obligation to report pursuant to the class owned by such person but shall not be this paragraph (2) shall continue until notification deemed to be outstanding for the purpose of comis received from the association that all classes puting the percentage of the class owned by any of securities are no longer quoted on such inter- other person. dealer quotation system. (i) Quarterly reports. Every registrant bank (3) (i) Any person who, after acquiring, directly shall file a quarterly report in conformity with the or indirectly, the beneficial ownership of any eq- requirements of Form F-4 for each fiscal quarter uity security of a member State bank, of a class ending after the close of the latest fiscal year for which is registered pursuant to section 12 of the which financial statements were filed in a regis- Act, is directly or indirectly the beneficial owner tration statement, except that no report need be of more than 5 per cent of such class shall, within filed for the fiscal quarter which coincides with ten days after such acquisition, send to the bank the end of the fiscal year of the bank. Such reports at its principal executive office, by registered or shall be filed not later than 30 days after the end certified mail, send to each exchange where the of such quarterly period, except that the report for security is traded, and file with the Board a state- any period ending prior to the date on which a ment containing the information required by Form class of securities of the bank first becomes effec- F-11. Eight copies of the statement shall be filed tively registered may be filed not later than 30 days with the Board. after the effective date of such registration. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 70 (j) Additional information. In addition to the would render the statement incomplete, unclear, information expressly required to be included in or confusing. a statement or report, there shall be added such (n) Summaries or outlines of documents. further material information, if any, as may be Where an item requires a summary or outline of necessary to make the required statements, in the the provisions of any document, only a brief light of the circumstances under which they are statement shall be made, in succinct and conmade, not misleading. densed form, as to the most important provisions. (k) Information not available. Information re- In addition to such statement, the summary or quired need be given only insofar as it is known outline may incorporate by reference particular or reasonably available to the bank. If any required items, sections, or paragraphs of any exhibit and information is unknown and not reasonably avail- may be qualified in its entirety by such reference. able to the bank, either because the obtaining Matter contained in an exhibit may be incorporated thereof would involve unreasonable effort or ex- by reference in answer to an item only to the extent pense or because it rests peculiarly within the permitted by this paragraph (n). knowledge of another person not affiliated with the (o) Omission of substantially identical docubank, the information may be omitted, subject to ments. In any case where two or more indentures, the following conditions: contracts, franchises, or other documents required (1) The bank shall give such information on the to be filed as exhibits are substantially identical subject as it possesses or can acquire without in all material respects except as to the parties unreasonable effort or expense together with the thereto, the date of execution, or other details, the sources thereof, and bank need file a copy of only one of such docu- (2) The bank shall include a statement either ments, with a schedule identifying the documents showing that unreasonable effort or expense would omitted and setting forth the material details in be involved or indicating the absence of any affil- which such documents differ from the document iation with the person within whose knowledge of which a copy is filed. The Board may at any the information rests and stating the result of a time in its discretion require the filing of copies request made to such person for the information. of documents so omitted. No such request need be made, however, to any (p) Additional exhibits. The bank may file such foreign government, or any agency or instrumen- exhibits as it may desire, in addition to those tality thereof, if, in the opinion of the bank, such required by the appropriate form. Such exhibits request would be harmful to existing relationships. shall be so marked as to indicate clearly the subject (0 Disclaimer of control. If the existence of matters to which they refer. control is open to reasonable doubt in any instance, (q) Incorporation of exhibits by reference. (1) the bank may disclaim the existence of control and Any document or part thereof previously filed with any admission thereof; in such case, however, the the Board pursuant to this Part may, subject to bank shall state the material facts pertinent to the the following limitations, be incorporated by refpossible existence of control. erence as an exhibit to any registration statement (m) Incorporation by reference. (1) Matter or report filed with the Board by the same or any contained in any part of a statement or report, other other person. Any document or part thereof filed than exhibits, may be incorporated by reference with an exchange pursuant to the Act may be in answer or partial answer to any item of a same incorporated by reference as an exhibit to any statement or report. Matter contained in an exhibit registration statement or report filed with the exmay be so incorporated to the extent permitted in change by the same or any other person. paragraph (n) of this section. A registration state- (2) Any document incorporated by reference ment for an additional class of securities of the pursuant to this paragraph (q) shall be so incorpobank may incorporate by reference any item con- rated only by reference to the specific document tained in a previous registration statement or re- and to the prior filing in which it was physically port. filed, not to another file which incorporates it by (2) Material incorporated by reference shall be reference. clearly identified in the reference. An express (3) If any modification has occurred in the text statement that the specified matter is incorporated of any document incorporated by reference since by reference shall be made at the particular place the filing thereof, the bank shall file with the in the statement or report where the information reference a statement containing the text of any is required. Matter shall not be incorporated by such modification and the date thereof. reference in any case where such incorporation (4) No document which has been on file with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

778 Federal Reserve Bulletin • November 1975 the Board pursuant to this Part for a period of original "ribbon" copy. Unsigned copies shall be more than 10 years may be incorporated by refer- conformed. If the signature of any person is afence. This limitation shall not, however, apply to fixed pursuant to a power of attorney or other a corporate charter or by-laws if such document similar authority, a copy of such power or other has not been amended more than twice since such authority shall also be filed with the statement or filing. report. (r) Extension of time for furnishing informa- (3) Each copy of a statement or report filed with tion. If the furnishing of any information, docu- the Board or with an exchange shall be bound in ment, or report at the time it is required to be one or more parts. Copies filed with the Board filed is impracticable, the bank may file with the shall be bound without stiff covers. The statement Board as a separate document an application (1) or report shall be bound on the left side in such identifying the information, document, or report a manner as to leave the reading matter legible. in question, (2) stating why the filing thereof at (t) Requirements as to paper, printing, and the time required is impracticable, and (3) re- language. (1) Statements and reports shall be filed questing an extension of time for filing the infor- on good quality, unglazed, white paper 8V2 x 13 mation, document, or report to a specified date inches in size, insofar as practicable. Tables, not more than 60 days after the date it would charts, maps, and financial statements may, howotherwise have to be filed. The application shall ever, be on larger paper if folded to that size. be deemed granted unless the Board, within 15 (2) The statement or report and, insofar as days after receipt thereof, shall enter an order practicable, all papers and documents filed as a denying the application. part thereof, shall be printed, lithographed, mim- (i) If the extension requested pursuant to this eographed, photocopied, or typewritten. The paragraph is necessitated by the inability of any statement or report or any portion thereof may, person other than the registrant to furnish any however, be prepared by any similar process that, required opinion, information, report or verifi- in the opinion of the Board, produces copies cation, the application shall have attached as an suitable for a permanent record. Irrespective of the exhibit, a statement signed by such person stating process used, all copies of any such material shall the specific reasons why such person is unable to be clear, easily readable, and suitable for repeated furnish the required opinion, information, report photocopying. Debits in credit categories and or verification. credits in debit categories shall be designated so (ii) If the application pursuant to this para- as to be clearly distinguishable as such on phograph, or the extension of time granted, relates tocopies. only to a portion of the required information, (3) The body of all printed statements and document or report, the registrant shall file the reports shall be in roman type at least as large remaining portion, and the portion filed shall as 10-point modern type. To the extent necessary prominently indicate the nature of the omitted for convenient presentation, however, financial portion. statements and other statistical or tabular data and (s) Number of copies; signatures; binding. (1) the notes thereto may be in type at least as large Except where otherwise provided in a particular as 8-point modern type. All type shall be leaded form, 8 copies of each registration statement and at least 2 points. report (including financial statements) and 4 copies (4) Statements and reports shall be in English. of each exhibit and each other document filed as If any exhibit or other paper or document filed a part thereof, shall be filed with the Board. At with a statement or report is in a foreign language, least one complete copy of each statement shall it shall be accompanied by a translation into Engbe filed with each exchange, if any, on which the lish. securities covered thereby are being registered. At (u) Preparation of statement or report. Each least one copy of each report shall be filed with statement and report shall contain the numbers and each exchange, if any, on which the bank has captions of all items of the appropriate form, but securities registered. the text of the items may be omitted provided the (2) At least one copy of each statement or report answers thereto are so prepared as to indicate to filed with the Board and one copy thereof filed the reader the coverage of the items without the with an exchange shall be manually signed. If the necessity of his referring to the text of the items statement or report is typewritten, one of the or instructions thereto. Where any item requires signed copies filed with the Board shall be an information to be given in tabular form, such Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 779 information shall be given in substantially the (z) When securities are deemed to be registabular form specified in the item. All instructions, tered. A class of securities with respect to which whether appearing under the items of the form or a registration statement has been filed pursuant to elsewhere therein, are to be omitted. Unless ex- section 12 of the Act shall be deemed to be pressly provided otherwise, if any item is inappli- registered for the purposes of sections 13, 14, and cable, or the answer thereto is in the negative, 16 of the Act and this Part only when such regisan appropriate statement to that effect shall be tration statement has become effective as provided made. in section 12, and securities of said class shall (v) Riders; inserts. Riders shall not be used. not be subject to sections 13, 14, and 16 of the If the statement or report is typed on a printed Act until such registration statement has become form, and the space provided for the answer to effective as provided in section 12. any given item is insufficient, reference shall be made in such space to a full insert page or pages on which the item number and caption and the SECTION 206.5— complete answer are given. PROXY STATEMENTS (w) Amendments. All amendments shall AND OTHER SOLICITATIONS comply with all pertinent requirements applicable UNDER SECTION 14 OF THE ACT to statements and reports. Amendments shall be (a) Requirement of statement. No solicitation filed separately for each separate statement or of a proxy with respect to a security of a bank report amended. Amendments to a statement may registered pursuant to section 12 of the Act shall be filed either before or after registration becomes be made unless each person solicited is concureffective. rently furnished, or has previously been furnished, (x) Title of securities. Wherever the title of with a written proxy statement containing the securities is required to be stated, information shall information required by Form F-5. If the managebe given that will indicate the type and general ment of any bank having such a security outstandcharacter of the securities, including: ing fails to solicit proxies from the holders of any (1) In the case of shares, the par or stated value, such security in such a manner as to require the if any; the rate of dividends, if fixed, and whether furnishing of such a proxy statement, such bank cumulative or noncumulative; a brief indication of shall transmit to all holders of record of such the preference, if any; and if convertible, a state- security a statement containing the information ment to that effect. required by Form F-5. The "information state- (2) In the case of funded debt, the rate of ment" required by the preceding sentence shall interest; the date of maturity, or if the issue ma- be transmitted (1) at least 20 calendar days prior tures serially, a brief indication of the serial ma- to any annual or other meeting of the holders of turities, such as "maturing serially from 1970 to such security at which such holders are entitled 1980"; if payment of principal or interest is con- to vote, or (2) in the case of corporate action taken tingent, an appropriate indication of such contin- with the written authorization or consent of secugency; a brief indication of the priority of the rity holders, at least 20 days prior to the earliest issue; and if convertible, a statement to that effect. date on which the corporate action may be taken. (3) In the case of any other kind of security, A proxy statement or an "information statement" appropriate information of comparable character. required by this paragraph is hereinafter sometimes (y) Interpretation of requirements. Unless the referred to as a "Statement". context clearly shows otherwise: (b) Exceptions. The requirements of the first (1) The forms require information only as to sentence of paragraph (a) of this section shall not the bank. apply to the following: (2) Whenever any fixed period of time in the (1) Any solicitation made otherwise than on past is indicated, such period shall be computed behalf of the management of the bank where the from the date of filing. total number of persons solicited is not more than (3) Whenever words relate to the future, they 10. have reference solely to present intention. (2) Any solicitation by a person in respect to (4) Any words indicating the holder of a position securities carried in his name or in the name of or office include persons, by whatever titles desig- his nominee (otherwise than as voting trustee) or nated, whose duties are those ordinarily performed held in his custody, if such person by holders of such positions or offices. (i) receives no commission or remuneration Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

780 Federal Reserve Bulletin • November 1975 for such solicitation, directly or indirectly, other of the report, provided that the attention of security than reimbursement of reasonable expenses; holders is called to such presentation. (ii) furnishes promptly to the person solicited (i) The report shall include a summary of the a copy of all soliciting material with respect to bank's operations containing the information rethe same subject matter or meeting received from quired by Item 4 of Form F-2 except for the all persons who will furnish copies thereof for such reconciliations, exhibits and supplemental inforpurpose and who will, if requested, defray the mation thereto. reasonable expenses to be incurred in forwarding (ii) The report shall contain a brief description such material; and of the operations done by the bank and its subsidi- (iii) in addition, does no more than (A) im- aries during the most recent fiscal year. partially instruct the person solicited to forward (iii) The report shall identify each of the a proxy to the person, if any, to whom the person bank's directors and officers, and shall indicate the solicited desires to give a proxy, or (B) impartially principal occupation or employment of each such requests from the person solicited instructions as person and the name and principal business of any to the authority to be conferred by the proxy and organization by which such person is so employed. state that a proxy will be given if no instructions (iv) The report shall identify the principal are received by a certain date. market, if any, in which securities of any class (3) Any solicitation by a person with respect entitled to vote at the meeting are traded, and shall to securities of which he is the beneficial owner. state the high and low sales prices for such securi- (4) Any solicitation through the medium of a ties (or, in the absence of such information, the newspaper advertisement that informs security range of bid and asked quotation) and the diviholders of a source from which they may obtain dends paid on such securities for each quarterly copies of a proxy statement, form of proxy, and period during the bank's two most recent fiscal any other soliciting material and does no more than years. If bank securities are inactively traded, the (i) name the bank; (ii) state the reason for the report shall so state and shall indicate the range advertisement; and (iii) identify the proposal or of sales prices known to management for the proposals to be acted upon by security holders. periods specified above and the source(s) of such (c) Annual report to security holders to ac- information. company Statements. (1) Any Statement fur- (2) Management's Statement, or the report, nished on behalf of the management of the bank shall contain an undertaking in bold face or otherthat relates to an annual meeting of security hold- wise reasonably prominent type to provide without ers at which directors are to be elected shall be charge to each person solicited, on the written accompanied or preceded by an annual report to request of any such person, a copy of the bank's such security holders containing such financial annual report on Form F-2 including the financial statements for the last 2 fiscal years as will, in statements and the schedules thereto, required to the opinion of the management, adequately reflect be filed with the Board pursuant to § 206.4 of the financial position of the bank at the end of this Part for the bank's most recent fiscal year, each such year and the results of its operations and shall indicate the name and address of the for each such year. The financial statements in- person to whom such a written request is to be cluded in the annual report may omit details or directed. In the discretion of management, a bank summarize information if such statements, con- need not undertake to furnish without charge sidered as a whole in the light of other information copies of all exhibits to its Form F-2 provided that contained in the report and in the light of the the copy of the annual report on Form F-2 furfinancial statements of the bank filed or to be filed nished without charge to requesting security holdwith the Board, will not by such procedure omit ers is accompanied by a list briefly describing all any material information necessary to a fair pre- the exhibits not contained therein and indicating that the bank will furnish any exhibit upon the sentation or to make the financial statements not payment of a specified reasonable fee which fee misleading under the circumstances. Subject to the shall be limited to the bank's reasonable expenses foregoing requirements with respect to financial in furnishing such exhibit. statements, the annual report to security holders may be in any form deemed suitable by the man- NOTE.—Pursuant to the undertaking required by the paraagement and the information required by para- graph (c)(2) of this section, a bank shall furnish a copy of graphs (c)(1) (i) to (iv) of this paragraph may be its annual report on Form F-2 to a beneficial owner of its securities upon receipt of a written request from such person. presented in an appendix or other separate section Each request must set forth a good faith representation that, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 781 as of the record date for the annual meeting of the bank's for each fiscal year for which a statement of income is fursecurity holders, the person making the request was a beneficial nished. owner of securities entitled to vote at such meeting. (e) A comparative reconciliation of the "Allowance for (3) Providing copies of material for certain Possible Loan Losses" account similar in form to Schedule VII, Form F-9D, and a comparative loan classification sumbeneficial owners. If the bank knows that securities mary similar in form to Schedule III, of Form F-9D. of any class entitled to vote at a meeting are held (f) Supplemental notes to financial statements to the extent necessary to furnish a fair financial presentation. Such notes of record by a broker, dealer, nonmember or should include the aggregate market value as at the balance sheet date for each category of investment securities reported member bank or voting trustee, or their nominees, on the balance sheet, and other information required to be the bank shall inquire of such record holder furnished in notes to financial statements included in the bank's Form F-2 Annual Report. whether other persons are the beneficial owners 2. The financial statements should be prepared on a consoliof such securities and, if so, the number of copies dated basis to the extent required by § 206.7(d). Any difference from the principles of consolidation or other accounting prinof the Statement and other soliciting material, if ciples or practices, or methods of applying accounting prinapplicable, and in,the case of an annual meeting ciples or practices, applicable to the financial statements of the bank filed or to be filed with the Board, which have a at which directors are to be elected, the number material effect on the financial position or results of operations of the bank, shall be noted and the effect thereof reconciled of copies of the annual report to security holders, or explained in the financial statements or the notes thereto necessary to supply such material to such benefi- in the annual report to security holders. 3. When financial statements included in the annual report cial owners. The bank shall supply such record (Form F-2) filed, or proposed to be filed, with the Board are holder with additional copies in such quantities, accompanied by an opinion of an independent public accountant, the financial statements in the annual report to security assembled in such form and at such a place, as holders should also be accompanied by an opinion of such the record holder may reasonably request in order independent public accountant. 4. The requirement for sending an annual report to each to address and send one copy of each to each person being solicited will be satisfied with respect to persons beneficial owner of securities so held and shall, having the same address by sending at least one report to a holder of record at that address provided (i) that management upon the request of such record holder, pay its has reasonable cause to believe that the record holder to whom the report is sent is the "beneficial owner" (see definition in reasonable expenses for completing the mailing of § 206.2(jj)) of securities registered in the name of such person such material to security holders to whom the in other capacities or in the name of other persons at such address, or (ii) the security holders at such address consent material is sent. thereto in writing. Nothing herein shall be deemed to relieve any person so consenting of any obligation to obtain or send (4) If bank's list of security holders indicates such annual report to any other person. that some of its securities are registered in the (5) Eight copies of each annual report sent to name of "Cede & Co.", a nominee for the De- security holders pursuant to this paragraph (c) of pository Trust Company, or in the name of a this section shall be sent to the Board not later nominee for any central certificate depository sys- than (i) the date on which such report is first sent tem, bank shall make appropriate inquiry of the or given to security holders, or (ii) the date on central depository system and thereafter of the which preliminary copies of the management participants in such a system who may hold on Statement are filed with the Board pursuant to behalf of a beneficial owner, and shall comply with paragraph (f) of this section, whichever date is the above paragraph with respect to any such later. Such annual report is not deemed to be participant. "soliciting material" or to be "filed" with the This paragraph (c) shall not apply, however, to Board or otherwise subject to this § 206.5 or the solicitations made on behalf of management before liabilities of section 18 of the Act, except to the the financial statements are available if solicitation extent that the bank specifically requests that it is being made at the time in opposition to the be treated as a part of the proxy soliciting material management and if the management's statement or incorporates it in the proxy statement by referincludes an undertaking in bold-face type to fur- ence. nish such annual report to all persons being so- (d) Requirements as to proxy. (1) The form licited at least 20 days before the date of the of proxy (i) shall indicate in bold-face type meeting. whether or not the proxy is solicited on behalf of the management of the bank, (ii) shall provide NOTES.— 1. To reflect adequately the financial position and a specifically designated blank space for dating the results of operations of a bank in its annual report to security proxy, and (iii) shall identify clearly and imparholders, the financial presentation shall include, but not necessarily be limited to, the following: tially each matter or group of related matters (a) Comparative statements of condition at the end of each of the last 2 fiscal years. intended to be acted upon, whether proposed by (b) Comparative statements of income in a form providing the management or by security holders. No referfor the determination of "net income" for each fiscal year and per share earnings and dividend data. ence need be made, however, to proposals as to (c) Comparative statements of changes in capital accounts which discretionary authority is conferred pursuant for each fiscal year similar in form to Form F-9C. (d) Comparative statements of changes in financial position to paragraph (d)(4) of this section. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

782 Federal Reserve Bulletin • November 1975 (2) Means shall be provided in the form of proxy any adjournment thereof) to be held after the date whereby the person solicited is afforded an oppor- on which the proxy statement and form of proxy tunity to specify by ballot a choice between ap- are first sent or given to security holders. A person proval or disapproval of each matter or group of shall not be deemed to be a bona fide nominee related matters referred to therein as intended to and he shall not be named as such unless he has be acted upon, other than elections to office. A consented to being named in the proxy statement proxy may confer discretionary authority with re- and to serve if elected. spect to matters as to which a choice is not so (6) The proxy statement or form of proxy shall specified if the form of proxy states in bold-face provide, subject to reasonable specified conditions, type how the shares represented by the proxy are that the shares represented by the proxy will be intended to be voted in each such case. voted and that where the person solicited specifies (3) A form of proxy which provides both for by means of a ballot provided pursuant to parathe election of directors and for action on other graph (d)(2) of this section a choice with respect specified matters shall be prepared so as clearly to any matters to be acted upon, the shares will to provide, by a box or otherwise, means by which be voted in accordance with the specifications so the security holder may withhold authority to vote made. for the election of directors. Any such form of (e) Presentation of information in Statement. proxy which is executed by the security holder (1) The information included in the Statement shall in such manner as not to withhold authority to be clearly presented and the statements made shall vote for the election of directors shall be deemed be divided into groups according to subject matter to grant such authority, provided the form of proxy and the various groups of statements shall be so states in bold-face type. This paragraph (3) does preceded by appropriate headings. The order of not apply (i) in the case of a merger, consolidation, items in the form need not be followed. Where or other plan if the election of directors is an practicable and appropriate, the information shall integral part of the plan and is not to be separately be presented in tabular form. All amounts shall voted upon or (ii) if the only matters to be acted be stated in figures. Information required by more upon are the election of directors and the election, than one applicable item need not be repeated. No selection, or approval of other persons such as statement need be made in response to any item clerks or auditors. that is inapplicable. (4) A proxy may confer discretionary authority (2) Any information required to be included in to vote with respect to any of the following mat- the Statement as to terms of securities or other ters: subject matter that from a standpoint of practical (i) Matters that the persons making the solic- necessity must be determined in the future may itation do not know, within a reasonable time be stated in terms of present knowledge and intenbefore the solicitation, are to be presented at the tion. To the extent practicable, the authority to meeting, if a specific statement to that effect is be conferred concerning each such matter shall be made in the proxy statement or form of proxy; confined within limits reasonably related to the (ii) Approval of the minutes of the prior need for discretionary authority. Subject to the meeting if such approval does not amount to foregoing information that is not known to the ratification of the action taken at the meeting; persons on whose behalf the solicitation is to be (iii) The election of any person to any office made and is not reasonably within the power of for which a bona fide nominee is named in the such persons to ascertain or procure may be omitproxy statement and such nominee is unable to ted, if a brief statement of the circumstances serve or for good cause refuses to serve; rendering such information unavailable is made. (iv) Any proposal omitted from the proxy (3) There may be omitted from a proxy statestatement and form of proxy pursuant to § ment any information contained in any other proxy 206.5(k); soliciting material that has been furnished to each (v) Matters incident to the conduct of the person solicited in connection with the same meeting. meeting or subject matter if a clear reference is (5) No proxy shall confer authority (i) to vote made to the particular document containing such for the election of any person to any office for information. which a bona fide nominee is not named in the (4) All printed Statements shall be set in roman proxy statement, or (ii) to vote at any annual type at least as large as 10-point modern type meeting other than the next annual meeting (or except that, to the extent necessary for convenient Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 783 presentation, financial statements and other statis- holders. Three copies of such material shall at the tical or tabular matter may be set in roman type same time be filed with, or mailed for filing to, at least as large as 8-point modern type. All type each exchange upon which any security of the shall be leaded at least 2 points. bank is listed. (5) All proxy statements shall disclose on the NOTE.—The definitive material filed with the Board should first page thereof the complete mailing address, be accompanied by a letter over the signature of an officer of bank or its counsel indicating any material changes which including ZIP code, of the principal executive have been made therein, other than those made in response offices of bank and the approximate date on which to the staff's comments. the proxy statement and form of proxy are first (4) If the solicitation is to be made in whole sent or given to security holders. or in part by personal solicitation, three copies of (f) Material required to be filed. (1) Three all written instructions or other material that dispreliminary copies of each Statement, form of cusses or reviews, or comments upon the merits proxy, and other items of soliciting material to of, any matter to be acted upon, and is furnished be furnished to security holders concurrently to the individuals making the actual solicitation therewith, shall be filed with the Board by man- for their use directly or indirectly in connection agement or any other person making a solicitation with the solicitation, shall be filed with the Board subject to this § 206.5 at least 10 calendar days by the person on whose behalf the solicitation is (or 15 calendar days in the case of other than made at least five days prior to the date copies routine meetings, as defined below) prior to the of such material are first sent or given to such date such item is first sent or given to any security individuals, or such shorter period prior to that holders, or such shorter period prior to that date date as may be authorized upon a showing of good as may be authorized. For the purposes of this cause therefor. paragraph (f)(1) of this section, a routine meeting (5) All copies of material filed pursuant to means a meeting with respect to which no one paragraphs (f) (1) and (2) of this section shall be is soliciting proxies subject to this § 206.5 other clearly marked "Preliminary Copies" and shall be than on behalf of management and at which man- for the information of the Board only, except that agement intends to present no matters other than such material may be disclosed to any department the election of directors, election of inspectors of or agency of the United States Government and election, and other recurring matters. In the ab- the Board may make such inquiries or investigasence of actual knowledge to the contrary, man- tion with respect to the material as may be necesagement may assume that no other such solici- sary for an adequate review thereof. All material tation of the bank's security holders is being made. filed pursuant to paragraphs (f) (1), (2), or (3) of In cases of annual meetings, one additional pre- this section shall be accompanied by a statement liminary copy of the Statement, the form of proxy, of the date upon which copies thereof are intended and any other soliciting material, marked to show to be or have been sent or given to security changes from the material sent or given to security holders. All material filed pursuant to paragraph holders with respect to the preceding annual meet- (f)(4) of this section shall be accompanied by a ing shall be filed with the Board. statement of the date upon which copies thereof (2) Three preliminary copies of any additional are intended to be released to the individuals who soliciting material, relating to the same meeting will make the actual solicitation. or subject matter, furnished to security holders (6) Copies of replies to inquiries for security subsequent to the proxy statement shall be filed holders requesting further information and copies with the Board at least two days (exclusive of of communications that do no more than request Saturdays, Sundays, and holidays) prior to the date that forms of proxy theretofore solicited be signed, copies of such material are first sent or given to dated, and returned need not be filed pursuant to security holders, or such shorter period prior to this paragraph (f). such date as may be authorized upon a showing (7) Notwithstanding the provisions of paraof good cause therefor. graphs (f)(1), (f)(2), and (i)(5) of this section, (3) Eight copies of each Statement, form of copies of soliciting material in the form of proxy, and other items of soliciting material, in speeches, press releases, and radio or television the form in which such material is furnished to scripts may, but need not, be filed with the Board security holders, shall be filed with, or mailed for prior to use or publication. Definitive copies, filing to, the Board not later than the date such however, shall be filed with or mailed for filing material is first sent or given to any security to the Board as required by paragraph (f)(3) of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

784 Federal Reserve Bulletin • November 1975 this section not later than the date such material group of such holders that the security holder shall is used or published. The provisions of paragraphs designate; (f)(1), (f)(2), and (i)(5) of this section shall apply, (ii) If the management of the bank has made however, to any reprints or reproductions of all or intends to make, through bankers, brokers, or or any part of such material. other persons, any solicitation of the beneficial (8) Where any Statement, form of proxy, or owners of securities of any class, a statement of other material filed pursuant to this paragraph (f) the approximate number of such beneficial owners, is revised, two of the copies of such revised or any group of such owners that the security material filed pursuant to paragraph (f)(3) of this holder shall designate; section shall be marked to indicate clearly the (iii) An estimate of the cost of mailing a changes. If the revision alters the text of the specified proxy statement, form of proxy, or other material, the changes in such text shall be indi- communication to such holders, including insofar cated by means of underscoring or in some other as known or reasonably available, the estimated appropriate manner. handling and mailing costs of the bankers, brokers, (9) The date that proxy material is "filed" with or other persons specified in paragraph (g)(1) (ii) the Board for purposes of paragraphs (f) (1), (2), of this section. and (4) of this section is the date of receipt of (2) (i) Copies of any proxy statement, form of the material by the Board, not the date of mailing proxy, or other communication furnished by the to the Board. In computing the advance filing security holder shall be mailed by the bank to such period for preliminary copies of proxy soliciting of the holders of record specified in paragraph material referred to in such paragraphs, the filing (g)(1) (i) of this section as the security holder shall date of the preliminary material is to be counted designate. The bank shall also mail to each banker, as the first day of the period and definitive material broker, or other persons specified in paragraph should not be planned to be mailed or distributed (g)(1) (ii) of this section, a sufficient number of to security holders until after the expiration of such copies of such proxy statement, form of proxy, period. Where additional time is required for final or other communication as will enable the banker, printing after receipt of comments, the preliminary broker, or other person to furnish a copy thereof proxy material should be filed as early as possible to each beneficial owner solicited or to be solicited prior to the intended mailing date. through him; (10) Where preliminary copies of material are (ii) Any such material that is furnished by filed with the Board pursuant to this subsection, the security holder shall be mailed with reasonable the printing of definitive copies for distribution to promptness by the bank after receipt of a tender security holders should be deferred until comments of the material to be mailed, of envelopes or other of the Board's staff have been received and con- containers therefor, of postage or payment for sidered. postage, and of evidence that such material has (g) Mailing communications for security been filed with the Board pursuant to paragraph holders. If the management of the bank has made (f) of this section. The bank need not, however, or intends to make any proxy solicitation subject mail any such material that relates to any matter to this § 206.5, the bank shall perform such of to be acted upon at an annual meeting of security the following acts as may be requested in writing holders prior to the earlier of (a) a day correwith respect to the same subject matter or meeting sponding to the first date on which management by any security holder who is entitled to vote on proxy soliciting material was released to security such matter or to vote at such meeting and who holders in connection with the last annual meeting shall first defray the reasonable expenses to be of security holders, or (b) the first day on which incurred by the bank in the performance of the solicitation is made on behalf of management. act or acts requested: With respect to any such material that relates to (1) The bank shall mail or otherwise furnish to any matter to be acted upon by security holders such security holder the following information as otherwise than at an annual meeting, such material promptly as practicable after the receipt of such need not be mailed prior to the first day on which request: solicitation is made on behalf of management. (i) A statement of the approximate number (iii) Neither the management nor the bank of holders of record of any class of securities, any shall be responsible for such proxy statement, form of the holders of which have been or are to be of proxy, or other communication. solicited on behalf of the management, or any (3) In lieu of performing the acts specified Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 785 above, the bank may, at its option, furnish matter to be acted upon by security holders. No promptly to such security holder a reasonably representation contrary to the foregoing shall be current list of the names and addresses of such made. of the holders of record specified in paragraph (i) Special provisions applicable to election (g)(1) (i) of this section as the security holder shall contests. designate, and a list of the names and addresses (1) Solicitations to which this paragraph apof the bankers, brokers, or other persons specified plies. This paragraph (i) applies to any solicitation in paragraph (g)(1) (ii) of this section as the subject to this § 206.5 by any person or group security holder shall designate together with a of persons for the purpose of opposing a solicistatement of the approximate number of beneficial tation subject to this section by any other person owners solicited or to be solicited through each or group of persons with respect to the election such banker, broker, or other person and a sched- or removal of directors at any annual or special ule of the handling and mailing costs of each such meeting of security holders. banker, broker, or other person, if such schedule (2) Participant defined, (i) For purposes of this has been supplied to the management of the bank. paragraph (i) the terms "participant" and "partic- The foregoing information shall be furnished ipant in a solicitation" include the following: promptly upon the request of the security holder (A) The bank; or at daily or other reasonable intervals as it (B) Any director of the bank, and any becomes available to the management of the bank. nominee for whose election as a director proxies (h) False or misleading statements. (1) No are solicited; solicitation or communication subject to this sec- (C) Any committee or group that solicits tion shall be made by means of any Statement, proxies, any member of such committee or group, form of proxy, notice of meeting, or other com- and any person whether or not named as a member munication, written or oral, containing any state- who, acting alone or with one or more other ment that, at the time and in the light of the persons, directly or indirectly, takes the initiative circumstances under which it is made, is false or in organizing, directing, or financing any such misleading with respect to any material fact, or committee or group; that omits to state any material fact necessary in (D) Any person who finances or joins with order to make the statements therein not false or another to finance the solicitation of proxies, exmisleading or necessary to correct any statement cept persons who contribute not more than $500 in any earlier communication with respect to the and who are not otherwise participants; solicitation of a proxy for the same meeting or (E) Any person who lends money or fursubject matter that has become false or misleading. nishes credit or enters into any other arrangements, Depending upon particular circumstances, the fol- pursuant to any contract or understanding with a lowing may be misleading within the meaning of participant, for the purpose of financing or otherthis paragraph: predictions as to specific future wise inducing the purchase, sale, holding, or votmarket values, earnings, or dividends; material ing of securities of the bank by any participant that directly or indirectly impugns character, in- or other person, in support of or in opposition to tegrity, or personal reputation, or directly or indi- a participant, except a member or nonmember rectly makes charges concerning improper, illegal, bank, broker, or dealer who, in the ordinary course or immoral conduct or associations, without fac- of business, lends money or executes orders for tual foundation; failure to so identify a Statement, the purchase or sale of securities and who is not form of proxy, and other soliciting material as to otherwise a participant; clearly distinguish it from the soliciting material (F) Any other person who solicits proxies, of any other person or persons soliciting for the (ii) Such terms do not include: same meeting or subject matter; claims made prior (A) Any person or organization retained or to a meeting regarding the results of a solicitation. employed by a participant to solicit security hold- (2) The fact that a proxy statement, form of ers and whose activities are limited to the perproxy, or other soliciting material has been filed formance of his or its duties in the course of such with or reviewed by the Board or its staff shall retention or employment, or any person who not be deemed a finding by the Board that such merely transmits proxy soliciting material or permaterial is accurate or complete or not false or forms ministerial or clerical duties; misleading, or that the Board has passed upon the (B) Any person employed by a participant merits of or approved any statement therein or any in the capacity of attorney, accountant, or adver- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

786 Federal Reserve Bulletin • November 1975 tising, public relations, or financial adviser, and riod as the Board may authorize upon a showing whose activities are limited to the performance of of good cause therefor. his duties in the course of such employment; (v) If any material change occurs in the facts (C) Any person regularly employed as an reported in any statement filed by or on behalf officer or employee of the bank or any of its of any participant, an appropriate amendment to subsidiaries who is not otherwise a participant; or such statement shall be filed promptly with the (D) Any officer or director of, or any per- Board and each appropriate exchange. son regularly employed by, any other participant, (vi) Each statement and amendment thereto if such officer, director, or employee is not other- filed pursuant to this paragraph (i) shall be part wise a participant. of the official public files of the Board and shall be deemed a communication subject to the provi- (3) Filing of information required by Form sions of paragraph (h) of this section. F-6. (i) No solicitation subject to this paragraph (i) shall be made by any person other than the (4) Solicitations prior to furnishing required management of the bank unless at least five busi- Statement. Notwithstanding the provisions of § ness days prior thereto, or such shorter period as 206.5(a), a solicitation subject to paragraph (i) of the Board may authorize upon a showing of good this section may be made prior to furnishing secucause therefor, there has been filed with the Board rity holders a written Statement containing the and with each exchange upon which any security information specified in Form F-5 with respect to of the bank is listed, by or on behalf of each such solicitation if (i) the statements required by participant in such solicitation, a statement in paragraph (3) of this paragraph (i) are filed by or duplicate containing the information specified by on behalf of each participant in such solicitation; Form F-6. (ii) no form of proxy is furnished to security (ii) Within five business days after a solici- holders prior to the time the Statement is furnished tation subject to this paragraph (i) is made by the to security holders, except that paragraph (i) (4) management of the bank, or such longer period (ii) of this section shall not apply where a Stateas the Board may authorize upon a showing of ment then meeting the requirements of Form F-5 good cause therefor, there shall be filed with the has been furnished to security holders by or on Board and with each exchange upon which any behalf of the person making the solicitation; (iii) security of the bank is listed, by or on behalf of at least the information specified in Items 1 (a) and each participant in such solicitation, other than the 3 (a) of the statement required by paragraph (i) bank, a statement in duplicate containing the in- (3) of this section to be filed by each participant, formation specified by Form F-6. or an appropriate summary thereof, is included in (iii) If any solicitation on behalf of manage- each communication sent or given to security ment or any other person has been made, or if holders in connection with the solicitation; and (iv) proxy material is ready for distribution, prior to a written Statement containing the information a solicitation subject to paragraph (i) (3) (i) of this specified in Form F-5 with respect to a solicitation section in opposition thereto, a statement in dupli- is sent or given security holders at the earliest cate containing the information specified in Form practicable date. F-6 shall be filed by or on behalf of each partici- (5) Solicitations prior to furnishing required pant in such prior solicitation, other than the bank, Statement—filing requirements. Three copies of as soon as reasonably practicable after the com- any soliciting material proposed to be sent or given mencement of the solicitation in opposition to security holders prior to the furnishing of the thereto, with the Board and with each exchange proxy statement required by § 206.5(a) shall be on which any security of the bank is listed. filed with the Board in preliminary form, at least (iv) If, subsequent to the filing of the state- five business days prior to the date copies of such ments required by paragraphs (i) (3) (i), (ii), and material are first sent or given to security holders, (iii) of this section, additional persons become or such shorter period as the Board may authorize participants in a solicitation subject to paragraph upon a showing of good cause therefor. (i) (3) (i) of this section, there shall be filed, with (6) Application of this paragraph to annual the Board and each appropriate exchange, by or report. Notwithstanding the provisions of § on behalf of each such person a statement in 206.5(c), three copies of any portion of the annual duplicate containing the information specified by report referred to in that paragraph that comments Form F-6, within three business days after such upon or refers to any solicitation subject to this person becomes a participant, or such longer pe- paragraph (i), or to any participant in any such Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 787 solicitation, other than the solicitation by the posal and indicate the disposition proposed to be management, shall be filed with the Board as proxy made of the proposal by the management at the material subject to this section. Such portion of meeting. The management of the bank shall not the annual report shall be filed with the Board in be required by this paragraph to include the propreliminary form at least five business days prior posal in its Statement or form of proxy for an to the date copies of the report are first sent or annual meeting unless the proposal is received by given to security holders. the management at the bank's principal executive (7) Application of paragraph (f). The provi- offices not less than 70 days in advance of a date sions of paragraphs (f) (3), (4), (5), (6), and (7) corresponding to the date set forth on the manageof this section shall apply, to the extent pertinent, ment's Statement released to security holders in to soliciting material subject to subparagraphs (5) connection with the last annual meeting of security and (6) of this paragraph (i). holders. A proposal to be presented at any other (8) Use of reprints or reproductions. In any meeting shall be received by the management of solicitations subject to paragraph (i) of this section, the bank a reasonable time before the solicitation soliciting material that includes, in whole or in is made. This paragraph (k) of this section shall part, any reprints or reproductions of any pre- not apply, however, to elections of office or to viously published material shall: counter proposals to matters to be submitted by (i) state the name of the author and publica- the management. tion, the date of prior publication, and identify NOTE.—In order to curtail controversy as to the date that any person who is quoted without being named a security holder's proposal was received by the management, in the previously published material. it is suggested that security holders submit their proposals by Certified Mail—Return Receipt Requested. (ii) except in the case of a public, official document or statement, state whether or not the (2) If the management opposes the proposal, it consent of the author and publisher has been shall also, at the written request of the security obtained to the use of the previously published holder, include in its Statement (i) the name and material as proxy soliciting material. address of the security holder, or a statement that (iii) if any participant using the previously such name and address will be furnished upon published material, or anyone on his behalf, paid, request, and (ii) a statement of the security holder directly or indirectly, for the preparation or prior (which shall not include such name and address) publication of the previously published material, of not more than 200 words in support of the or has made or proposed to make any payments proposal. Any statements in the text of a proposal, or given any other consideration in connection such as a preamble or "whereas" clauses, which with the publication or republication of such ma- are in effect arguments in support of the proposal, terial, state the circumstances. shall be deemed part of the supporting statement (j) Prohibition of certain solicitations. No and subject to the 200-word limitation thereon. person making a solicitation that is subject to this The statement and request of the security holder § 206.5 shall solicit (1) any undated or postdated shall be furnished to the management at the same proxy ; or (2) any proxy that provides that it shall time that the proposal is furnished. Neither the be deemed to be dated as of any date subsequent management nor the bank shall be responsible for to the date on which it is signed by the security such statement. holder. (3) Notwithstanding paragraphs (k) (1) and (2) (k) Proposals of security holders. (1) If any of this section, the management may omit a prosecurity holder entitled to vote at a meeting of posal and any statement in support thereof from security holders of the bank shall submit to the its Statement or form proxy under any of the management of the bank, within the time herein- following circumstances: after specified, a proposal which is accompanied (i) if the proposal is impossible to accomplish by notice of his intention to present the proposal or, under applicable law, is not a proper subject for action at the meeting, the management shall for action by security holders; or set forth the proposal in its Statement. If manage- (ii) if the proposal consists of a recomment issues a proxy statement, it shall identify the mendation or request that the management take proposal in its form of proxy and provide means action with respect to a matter relating to the by which security holders can either approve or conduct of the ordinary business operations of the disapprove the proposal. If management issues an bank; or information statement, it shall identify the pro- (iii) if it appears that the proposal is submitted Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

788 Federal Reserve Bulletin • November 1975 by the security holder principally for the purpose of the proposal and any statement in support of enforcing a personal claim or redressing a thereof as received from the security holder, topersonal grievance against the bank or its man- gether with a statement of the reasons why the agement, or consists of a recommendation, request management deems such omission to be proper or mandate that action be taken with respect to in the particular case, and, where such reasons any matter, including a general economic, politi- are based on matters of law, a supporting opinion cal, racial, religious, social, or similar cause that of counsel. The management shall at the same is neither significantly related to the business of time, if it has not already done so, notify the the bank nor within the control of the bank; or security holder submitting the proposal of its in- (iv) if the management has at the security tention to omit the proposal from its Statement holder's request included a proposal in its proxy and shall forward to him a copy of the statement statement and form of proxy relating to either of of the reasons why the management deems the the two preceding annual meetings of security omission of the proposal to be proper and a copy holders or any special meeting held subsequent to of such supporting opinion of counsel. the earlier of such two annual meetings, and such (/) Invitation for tenders. (1) No person, disecurity holder has failed without good cause to rectly or indirectly, by use of the mails or by any present the proposal, in person or by proxy, for means or instrumentality of interstate commerce action at the meeting; or or of any facility of a national securities exchange (v) if substantially the same proposal has or otherwise, shall make a tender offer for, or a previously been submitted to security holders in request or invitation for tenders of, any class of the management's proxy statement and form of any equity security, which is registered pursuant proxy relating to any meeting of security holders to section 12 of the Act, of a member State bank held within the preceding five calendar years, it if, after consummation thereof, such person may be omitted from the proxy statement relating would, directly or indirectly, be the beneficial to any meeting of security holders held within the owner of more than 5 per cent of such class, three calendar years after the latest such previous unless, at the time copies of the offer or request submission; provided, that (a) if the proposal had or invitation are first published or sent or given been submitted at only one meeting during such to security holders, such person has filed with the preceding period, it received less than 3 per cent Board a statement containing the information and of the total number of votes cast in regard thereto, exhibits required by Form F-11. or (b) if the proposal had been submitted at only (2) If any material change occurs in the facts two meetings during such preceding period, it set forth in the statement required by paragraph received at the time of its second submission less (1) of this section, the person who filed such than 6 per cent of the total number of votes cast statement shall promptly file with the Board an in regard thereto, or (c) if the proposal had been amendment disclosing such change. submitted at three or more meetings during such (3) All tender offers for, or requests or invitaperiod, it received at the time of its latest submis- tions for tenders of, securities published or sent sion less than 10 per cent of the total number of or given to the holders of such securities shall votes cast in regard thereto; or include the following information: (vi) if, prior to the receipt of such proposal, (i) The name of the person making the tender substantially the same proposal has been received offer, request or invitation; by the management from another security holder (ii) The exact dates prior to which, and after and is to be included in the bank's proxy soliciting which, security holders who deposit their securimaterial. ties will have the right to withdraw their securities NOTE.—Proposals not within the bank's control are those pursuant to section 14(d)(5) of the Act, or otherwhich are beyond its power to effectuate. wise; (4) Whenever the management asserts that a (iii) If the tender offer or request or invitation proposal and any statement in support thereof may for tenders is for less than all of the outstanding properly be omitted from its Statement and form securities of the class and the person making the of proxy, it shall file with the Board, not later offer, request or invitation is not obligated to than 30 days prior to the date the preliminary purchase all of the securities tendered, the date copies of the Statement or form of proxy are filed of expiration of the period during which the sepursuant to § 206.5(f)(1) or such shorter period curities will be taken up pro rata pursuant to prior to such date as the Board may permit, a copy section 14(d)(6) of the Act, or otherwise; and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 789 (iv) The information required by Items 2 (a) is to be made and any plan or proposal for the and (c), 3, 4, 5 and 6 of Form F-ll, or a fair disposition of such securities; and and adequate summary thereof, and shall be filed (C) The source and amount of funds or with the Board as part of the statement required other consideration used or to be used in making by paragraph (1) of this section. the purchases, and if any part of the purchase price (4) Any additional material soliciting or re- or proposed purchase price is represented by funds questing such tender offers subsequent to the initial or other consideration borrowed or otherwise obsolicitation or request shall contain the name of tained for the purpose of acquiring, holding, or the persons making such solicitation or request and trading the securities, a description of the transacthe information required by Items 2 (a) and (c), tion and the names of the parties thereto. 3, 4, 5 and 6 of Form F-ll, or a fair and adequate (ii) The control person has at any time within summary thereof; provided, however, that such the past six months sent or given to the equity material may omit any of such information pre- security holders of the issuing bank the substance viously furnished to the persons solicited or re- of the information contained in the statement requested for tender offers. Copies of such additional quired by subparagraph (1)(6) (i) of this section. material soliciting or requesting such tender offers (7) Eight copies of the statement required by shall be filed with the Board not later than the subparagraph (1) of this paragraph, every amendtime copies of the material are first published or ment to such statement, and all other material sent or given to security holders. required by this section shall be filed with the (5) If any securities to be offered in connection Board. with the tender offer for, or request or invitation (8) Certain communications. The following for tenders of, securities with respect to which a communications shall not be deemed to be requests statement is required to be filed pursuant to para- or invitations for tenders: graph (1) of this section, have been or are to be (i) Offers to purchase securities made in conregistered under the Securities Act of 1933, a copy nection with a distribution of securities permitted of the prospectus containing the information re- by Rules 10b-6, 10b-7 and 10b-8 under the Act quired to be included therein under that Act shall as promulgated by the Securities and Exchange be filed as an exhibit to such statement. Any Commission (17 CFR §§ 240.10b-6, 10b-7 and information contained in the prospectus may be 10b-8). incorporated by reference in such statement. (ii) The call or redemption of any security (6) When a person makes a tender offer for, in accordance with the terms and conditions of or request or invitation for tenders of, any class the governing instruments. of equity securities of a bank registered pursuant (iii) Offers to purchase securities evidenced to section 12 of the Act, and such person has filed by a script certificate, order form or similar docua statement with the Board pursuant to this section, ment which represents a fractional interest in a any other person controlling, controlled by, or share of stock or similar security. under common control ("control person") with (iv) Offers to purchase securities pursuant to the issuing bank, which bank is prohibited by R.S. a statutory procedure for the purchase of dissenting 5201 (12 U.S.C. § 83) from purchasing, with shareholders' securities. certain exceptions, shares of its own capital stock, (v) The furnishing of information and advice shall not thereafter, during the period such tender regarding a tender offer to customers or clients offer, request or invitation continues, purchase any by attorneys, member or nonmember banks, class of equity securities of the issuing bank brokers, fiduciaries or investment advisers, who unless: are not otherwise participating in the tender offer (i) The control person has filed with the Board or solicitation, on the unsolicited request of a a statement containing the information specified person or pursuant to a general contract for advice below with respect to proposed purchases: to the person to whom the information or advice (A) The title and amount of equity securi- is given. ties to be purchased, the names of the persons or (vi) A communication from a bank to its classes of persons from whom, and the market in security holders which does no more than (1) which, the securities are to be purchased, includ- identify a tender offer or request or invitation for ing the name of any exchange on which the pur- tenders made by another person, (2) state that the chase is to be made; management of the bank is studying the matter (B) The purpose for which the purchase and will, on or before a specified date (which shall Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

790 Federal Reserve Bulletin • November 1975 be not later than 10 days prior to the date specified elected or designated will constitute a majority of in the offer, request or invitation, as the last date the directors of the bank, then, not less than 10 on which tenders will be accepted, or such shorter days prior to the date any such person takes office periods as the Board may authorize) advise secu- as a director, or such shorter period prior to that rity holders as to the management's recom- date as the Board may authorize upon a showing mendation to accept or reject the offer, request of good cause therefor, the bank shall file with or invitation, and (3) request security holders to the Board and transmit to all holders of record defer making a determination as to whether or not of securities of the bank who would be entitled they should accept or reject the offer, request or to vote at a meeting for election of directors, invitation until they have received the manage- information substantially equivalent to the informent's recommendation with respect thereto. mation which would be required by Items 5 (a), (m) Recommendations as to tender offers. (d), (e) and (f), 6 and 7 of Form F-5 to be transmitted if such person or persons were nom- (1) No solicitation or recommendation to the inees for election as directors at a meeting of such holders of a security to accept or reject a tender security holders. offer or request or invitation for tenders subject to section 14(d) of the Act shall be made unless, (o) Solicitation prior to furnishing required at the time copies of the solicitation or recom- proxy statement. (1) Notwithstanding the provimendation are first published or sent or given to sions of § 206.5(a), a solicitation (other than one holders of the security, the person making such subject to § 206.5(i)) may be made prior to fursolicitation or recommendation has filed with the nishing security holders a written proxy statement Board a statement containing the information spe- containing the information specified in Form F-5 cified by Form F-12; provided, however, that this with respect to such solicitation if— paragraph does not apply to (i) a person required (i) The solicitation is made in opposition to by § 206.5(1) 'to file a statement, or (ii) a person, a prior solicitation or an invitation for tenders or other than the bank or the management of the other publicized activity, which if successful, bank, who makes no written solicitations or reccould reasonably have the effect of defeating the ommendations other than solicitations or recomaction proposed to be taken at the meeting. mendations copies of which have otherwise been (ii) No form of proxy is furnished to security filed with the Board. holders prior to the time the written proxy state- (2) If any material change occurs in the facts ment required by § 206.5(a) is furnished to secuset forth in the statement required by paragraph rity holders; provided, however, that this para- (m)(l) of this section, the person who filed such graph (o)(ii) of this section shall not apply where statement shall promptly file with the Board an a proxy statement then meeting the requirements amendment disclosing such change. of Form F-5 has been furnished to security holders (3) Any written solicitation or recommendation by or on behalf of the person making the solicito the holders of a security to accept or reject a tation; tender offer or request or invitation for tenders (iii) The identity of the person or persons by subject to section 14(d) of the Act shall include or on whose behalf the solicitation is made and the name of the person making such solicitation a description of their interests, direct or indirect, or recommendation and the information required by security holdings or otherwise, are set forth by Items 1(b) and 2(b) of Form F-12, or a fair in each communication sent or given to security and adequate summary thereof; provided, how- holders in connection with the solicitation; and ever, that such written solicitation or recom- (iv) A written proxy statement meeting the mendation may omit any of such information pre- requirements of this section is sent or given to viously furnished to the persons to whom the security holders at the earliest practicable date. solicitation or recommendation is made. (2) Three copies of any soliciting material pro- (n) Change in majority of directors. If, pur- posed to be sent or given to security holders prior suant to any arrangement or understanding with to the furnishing of the written proxy statement the person or persons acquiring securities in a required by § 206.5(a) shall be filed with the Board transaction subject to section 13(d) or 14(d) of the in preliminary form at least 5 business days prior Act, any persons are to be elected or designated to the date definitive copies of such material are as directors of the bank, otherwise than at a first sent or given to security holders, or such meeting of security holders, and the persons so shorter period as may be authorized. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 791 SECTION 206.6—"INSIDERS' " on or after the date on which he ceased to be such SECURITIES TRANSACTIONS AND director or officer, or the date on which bank REPORTS UNDER SECTION 16 OF THE ACT ceased to have any equity securities so registered, as the case may be, if such change shall occur (a) Filing of statements by directors, officers within 6 months after any change in his beneficial and principal stockholders. (1) Initial statements ownership of such securities prior to such date. of beneficial ownership of equity securities of a The statement on Form F-8 shall be filed within bank required by section 16(a) of the Act, and 10 days after the end of the month in which the statements of changes in such beneficial ownerreported change in beneficial ownership occurs. ship, shall be prepared and filed in accordance with (b) Ownership of more than 10 per cent of the requirements of Form F-7 and Form F-8, a class of equity securities. (1) In determining respectively. for the purpose of section 16(a) of the Act whether (2) A person who is already filing statements a person is the beneficial owner, directly or indiwith the Board pursuant to section 16(a) of the rectly, of more than 10 per cent of any class of Act need file an additional statement on Form F-7 equity securities, such person shall be deemed to when an additional class of equity securities of be the beneficial owner of securities of such class the same bank becomes registered or when he which such person has the right to acquire through assumes another or an additional relationship to the exercise of presently exercisable options, warthe bank; for example, when an officer becomes rants or rights or through the conversion of presa director. ently convertible securities. The securities subject (3) Any bank that has equity securities listed to such options, warrants, rights or conversion on more than one national securities exchange may privileges held by a person shall be deemed to designate one of them as the only exchange with be outstanding for the purpose of computing the which reports pursuant to section 16(a) of the Act percentage of outstanding securities of the class need be filed. Such designation shall be filed with owned by such person but shall not be deemed the Board and with each national securities ex- outstanding for the purpose of computing the perchange on which any equity security of the bank centage of the class owned by any other person. is listed. After the filing of such designation the This subparagraph shall not be construed to relieve securities of such bank shall be exempted with any person of any duty to comply with section respect to the filing of statements pursuant to 16(a) of the Act with respect to any equity securisection 16(a) of the Act with any exchange other ties consisting of options, warrants, rights or conthan the designated exchange. vertible securities which are otherwise subject as a class to section 16(a) of the Act. (4) Any director or officer who is required to file a statement on Form F-8 with respect to any (2) For the purpose of this paragraph a person change in his beneficial ownership of equity se- acting in good faith may rely on the information curities which occurs within six months after he contained in the latest Form F-1, F-1B or F-2 filed became a director or officer of the bank issuing with the Board under § 206.4 with respect to the such securities, or within six months after equity amount of securities of the class outstanding or securities of such bank first became registered in the case of voting trust certificates or certificates pursuant to section 12 of the Act, shall include of deposit the amount thereof issuable. in the first such statement the information called (3) For the purpose of determining percentage for by Form F-8 with respect to all changes in ownership of voting trust certificates or certificates his beneficial ownership of equity securities of of deposit for equity securities, the class of voting such bank which occurred within 6 months prior trust certificates or certificates of deposit shall be to the date of the changes which require the filing deemed to consist of the amount of voting trust of such statement. certificates or certificates of deposits issuable with (5) Any person who has ceased to be a director respect to the total amount of outstanding equity or officer of a bank which has equity securities securities of the class which may be deposited registered pursuant to section 12(g) of the Act, under the voting trust agreement or deposit agreeor who is a director or officer of a bank at the ment in question, whether or not all of such time it ceased to have any equity securities so outstanding securities have been so deposited. registered, shall file a statement on Form F-8 with (c) Disclaimer of beneficial ownership. Any respect to any change in his beneficial ownership person filing a statement may expressly declare of equity securities of such bank which shall occur therein that the filing of such statement shall not Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

792 Federal Reserve Bulletin • November 1975 be construed as an admission that such person is, by a trust, regardless of the number of officers, for the purpose of section 16 of the Act, the directors, or 10 per cent stockholders who are beneficial owner of any equity securities covered either trustees, settlors, or beneficiaries of a trust by the statement. if the report filed discloses the names of all trustees, settlors, or beneficiaries who are officers, (d) Ownership of securities held in trust. (1) directors, or 10 per cent stockholders. A person Beneficial ownership of a bank's securities for the having an interest only as a beneficiary of a trust purpose of section 16(a) of the Act shall include: shall not be required to file any such report so (i) the ownership of such securities as a long as he relies in good faith upon an undertrustee where either the trustee or members of his standing that the trustee of such trust will file immediate family have a vested interest in the whatever reports might otherwise be required of income or corpus of the trust. such beneficiary. (ii) the ownership of vested beneficial interest in a trust, and (5) In determining, for the purposes of para- (iii) the ownership of such securities as a graph (a) of this section, whether a person is the settlor of a trust in which the settlor has the power beneficial owner, directly or indirectly, of more to revoke the trust without obtaining the consent than 10 per cent of any class of equity security of all beneficiaries. of a bank, the interest of such person in the (2) Except as provided in paragraph (d)(3) of remainder of a trust shall be excluded. this section, beneficial ownership of securities of (6) No report shall be required by any person, registrant banks solely as a settlor or beneficiary whether or not otherwise subject to the requireof a trust shall be exempt from the provisions of ment of filing reports under section 16(a) of the section 16(a) of the Act where less than 20 per Act, with respect to his indirect interest in portfolio cent in market value of the securities having a securities held by readily ascertainable market value held by such (i) any holding company registered under the trust (determined as of the end of the preceding Public Utility Holding Company Act, fiscal year of the trust) consists of equity securities (ii) any investment company registered under with respect to which reports are required by the Investment Company Act, section 16(a) of the Act or would be required but (iii) a pension or retirement plan holding for an exemption by the Securities and Exchange securities of a bank whose employees generally Commission, the Comptroller of the Currency, or are the beneficiaries of the plan, the Federal Deposit Insurance Corporation similar (iv) a business trust with over 25 benefito the exemption provided for by this sentence. ciaries. Exemption from section 16(a) of the Act is like- (e) Certain transactions subject to section wise accorded with respect to any obligation that 16(a) of the Act. (1) The granting, acquisition would otherwise be imposed solely by reason of or disposition of any presently exercisable put, ownership as settlor or beneficiary of a bank's call, option, or other right or obligation to buy securities held in trust, where the ownership, ac- securities from, or to sell securities to, another quisition, or disposition of such securities by the person, or any expiration or cancellation thereof trust is made without prior approval by the settlor shall be deemed to effect such a change in the or beneficiary. No exemption pursuant to this beneficial ownership of the bank's security to subparagraph shall, however, be acquired or lost which the right or obligation relates as to require solely as a result of changes in the value of the the filing of a statement reflecting the granting, trust assets during any fiscal year or during any acquisition or disposition of such right or obligatime when there is no transaction by the trust in tion. Nothing in paragraph (e) of this section, the securities otherwise subject to the reporting however, shall exempt any person from filing the requirements of section 16(a) of the Act. statements required upon the exercise of such put, (3) In the event that 10 per cent of any class call, option or other right or obligation to buy or of any equity security of a bank is held in a trust, sell securities. that trust and the trustees thereof as such shall be (i) If any such right or obligation is not deemed a person required to file the reports speci- initially exercisable, the granting and acquisition fied in section 16(a) of the Act. thereof shall be reported in a statement filed for (4) Not more than one report need be filed to the month in which it became exercisable, unless report any holdings of a bank's securities or with the filing of such statement is otherwise not rerespect to any transaction in such securities held quired. 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Law Department 793 (ii) The right of a pledgee or borrower of (ii) the person effecting such acquisition does securities to sell the pledge or borrowed securities not participate in acquisitions or in dispositions is not an option or right to sell securities within of securities of the same class having a total market the meaning of this paragraph. However, the sale value in excess of $3,000 for any six-month period of the pledged or borrowed securities by the during which the acquisition occurs. pledgee or borrower shall be reported by the pled- (2) Any acquisition or disposition of a bank's gor or lender. securities by way of gift, where the total amount (iii) The right to acquire securities, or the of such gifts does not exceed $3,000 in market obligation to dispose of securities, in connection value for any six-month period, shall be exempt with a merger or consolidation involving the bank from section 16(a) of the Act and may be excluded issuing the securities is not a right or obligation from the computations prescribed in paragraph to buy or sell securities within the meaning of this (g)(l)(ii) of this section. paragraph. (3) Any person exempted by paragraphs (g) (1) (2) For the purpose of section 16(a) of the Act or (2) of this section shall include in the first report both the grantor and the holder of any presently filed by him after a transaction within the exempexercisable put, call, option or other right or tion a statement showing his acquisitions and obligation to buy or sell securities shall be deemed dispositions for each six-month period or portion to be beneficial owners of securities subject to such thereof that has elapsed since his last filing. right or obligation until it is exercised or cancelled (h) Temporary exemption of certain persons or expires. from sections 16 (a) and (b) of the Act. During (3) Notwithstanding the foregoing, a statement the period of 12 months following their appointneed not be filed pursuant to section 16(a) of the ment and qualification, a bank's securities held by Act (i) by any person with respect to the acquisi- the following persons shall be exempt from section, expiration or cancellation of any nontrans- tions 16(a) and 16(b) of the Act: ferable qualified, restricted or other stock option (1) Executors or administrators of the estate of granted by the bank with respect to securities to a decedent; which the option relates pursuant to a plan pro- (2) Guardians or committees for an incompevided for the benefit of the bank's employees or tent; and the employees of the bank's affiliates if such plan (3) Receivers, trustees in bankruptcy, assignees meets the condition specified in § 206.6(1), or (ii) for the benefit of creditors, conservators, liquidatby any bank with respect to any put, call, option ing agents, and similar persons duly authorized or other right or obligation to buy or sell securities by law to administer the estate or assets of other of which it is the issuer. persons. After the 12-month period following their NOTE.—An option, otherwise non-transferable, is deemed appointment and qualification the foregoing perto be non-transferable even though it may be disposed of by will or by descent and distribution upon the death of the holder. sons shall be required to file reports under section (f) Exemption from section 16 of securities 16(a) with respect to a bank's securities held by purchased or sold by odd-lot dealers. A bank's the estates that they administer and shall be liable securities purchased or sold by an odd-lot dealer for profits realized from trading in such securities (1) in odd-lots so far as reasonably necessary to pursuant to section 16(b) only when the estate carry on odd-lot transactions, or (2) in round lots being administered is a beneficial owner of more to offset odd-lot transactions previously or simul- than 10 per cent of any class of equity security taneously executed or reasonably anticipated in the of the bank. usual course of business, shall be exempt from (i) Exemption from section 16(b) of transacthe provisions of section 16 of the Act with respect tions that need not be reported under section to participation by such odd-lot dealer in such 16(a). Any transaction that has been or shall be transactions. exempted by the Board from the requirements of (g) Exemption of small transactions from section 16(a) shall, insofar as it is otherwise subsection 16(a) of the Act. (1) Any acquisition of ject to the provisions of section 16(b), be likewise a bank's securities shall be exempt from section exempted from section 16(b). 16(a) of the Act where (j) Exemption from section 16(b) of certain (i) the person effecting the acquisition does transactions by registered investment companot within six months thereafter effect any dispo- nies. Any transaction of purchase and sale or sale sition, otherwise than by way of gift of securities and purchase, of any equity security of a bank of the same class, and shall be exempt from the operation of section 16 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

794 Federal Reserve Bulletin • November 1975 (b), as not comprehended within the purpose of therein of one party thereto shall not render such that section, if the transaction is effected by an transaction exempt with respect to participation of investment company registered under the Invest- any other party therein unless such other party also ment Company Act of 1940 and both the purchase meets the conditions of this paragraph. and sale of such security have been exempted from (/) Exemption from section 16(b) of acquisithe provisions of section 17(a) of the Investment tions of shares of stock and stock options under Company Act of 1940 by an order of the Securities certain stock bonus, stock option, or similar and Exchange Commission entered pursuant to plans. Any acquisition of shares of a bank's stock section 17(b) of that Act. (other than stock acquired upon the exercise of (k) Exemption from section 16(b) of certain an option, warrant, or right) pursuant to a stock transactions effected in connection with a dis- bonus, profit sharing retirement, incentive, thrift, tribution. (1) Any transaction of purchase and savings, or similar plan, or any acquisition of a sale, or sale and purchase, of an equity security qualified or restricted stock option pursuant to a of a bank that is effected in connection with the qualified or restricted stock option plan, or of a distribution of a substantial block of such securities stock option pursuant to an employee stock purshall be exempt from the provisions of section chase plan, by a director or officer of the bank 16(b), to the extent specified in paragraph (k) of issuing such stock or stock option shall be exempt this section, as not comprehended within the pur- from the operation of section 16(b) if the plan pose of said section, upon the following condi- meets the following conditions: tions: (1) The plan has been duly approved, directly (i) The person effecting the transaction is or indirectly, engaged in the business of distributing securities (i) by the holders of a majority of the securiand is participating in good faith, in the ordinary ties of the bank present, or represented, and enticourse of such business, in the distribution of such tled to vote at the meeting at which it was apblock of securities; proved, or by the written consent of the holders (ii) The security involved in the transaction of a majority of the securities of the bank entitled is (a) a part of such block of securities and is to vote, or acquired by the person effecting the transaction, (ii) by the holders of a majority of the securiwith a view to the distribution thereof, from the ties of a predecessor so entitled to vote, if the bank or other person on whose behalf such securi- plan or obligations to participate thereunder were ties are being distributed or from a person who assumed by the bank in connection with the sucis participating in good faith in the distribution cession. Provided, however, that if such vote or of such block of securities, or (b) a security written consent was not solicited substantially in purchased in good faith by or for the account of accordance with the requirements, if any, in effect the person effecting the transaction for the purpose under § 206.5 of this Part at the time of such vote of stabilizing the market price of securities of the or written consent, the bank shall furnish in writing class being distributed or to cover an overallotment to the holders of record of the securities entitled or other short position created in connection with to vote for the plan substantially the same inforsuch distribution; and mation concerning the plan which would be re- (iii) Other persons not within the purview of quired by the provisions in effect under § 206.5 section 16(b) are participating in the distribution of this Part at the time such information is furof such block of securities on terms at least as nished, if proxies to be voted with respect to the favorable as those on which such person is partic- approval or disapproval of the plan were then ipating and to an extent at least equal to the being solicited, on or prior to the date of the first aggregate participation of all persons exempted annual meeting of security holders held subsequent from the provisions of section 16(b) by paragraph to the later of (A) the first registration of an equity (k) of this section. However, the performance of security under section 12 of the Act, or (B) the the functions of manager of a distributing group acquisition of an equity security for which exempand the receipt of a bona fide payment for per- tion is claimed. Such written information may be forming such functions shall not preclude an ex- furnished by mail to the last known address of emption that would otherwise be available under the security holders of record within 30 days prior this paragraph. to the date of mailing. Eight copies of such written information shall be filed with, or mailed for filing (2) The exemption of a transaction pursuant to to, the Board not later than the date on which it this paragraph (k) with respect to the participation Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 795 is first sent or given to security holders of the bank. plan of the bank or any of its affiliates entitling (2) If the selection of any director or officer the participants therein to acquire stock or qualiof the bank to whom stock may be allocated (or fied, restricted, or employee stock purchase plan to whom qualified, restricted, or employee stock stock options of the bank or any of its affiliates. purchase plan stock options may be granted pur- (3) As to each participant or as to all participants suant to the plan) or the determination of the the plan effectively limits the aggregate dollar number or maximum number of shares of stock amount or the aggregate number of shares of stock that may be allocated to any such director or that may be allocated (or may be subject to qualiofficer (or that may be covered by qualified, re- fied, restricted, or employee stock purchase plan stricted, or employee stock purchase plan stock stock options granted) pursuant to the plan. The options granted to any such director or officer) limitations may be established on an annual basis, is subject to the discretion of any person, then or for the duration of the plan, whether or not such discretion shall be exercised only as follows: the plan has a fixed termination date. Such limita- (i) With respect to the participation of direc- tions may be determined either by fixed or maxitors (A) by the board of directors of the bank, mum dollar amounts, fixed or maximum numbers a majority of which board and a majority of the of shares, formulas based upon earnings of the directors acting in the matter are disinterested bank, dividends paid, compensation received by persons; (B) by, or only in accordance with the participants, option prices, market value of shares, recommendation of, a committee of three or more outstanding shares or percentages thereof outpersons having full authority to act in the matter, standing from time to time, or similar factors that all of the members of which committee are disin- will result in an effective and determinable limitaterested persons; or (C) otherwise in accordance tion. Such limitations may be subject to any prowith the plan, if the plan specifies the number or visions for adjustment of the plan or of stock maximum number of shares of stock that directors allocable (or options outstanding thereunder) to may acquire (or that may be subject to qualified, prevent dilution or enlargement of rights. restricted, or employee stock purchase plan stock (4) The term "exercise of an option, warrant options granted to directors) and the terms upon or right" contained in the parenthetical clause of which and the times at which, or the periods within the first sentence of § 206.6(1) shall not include which, such stock may be acquired (or such op- (i) the making of any election to receive under tions may be acquired and exercised); or sets forth, any plan compensation in the form of stock or by formula or otherwise, effective and determi- credits therefor; provided that such election is nable limitations with respect to the foregoing made either prior to the making of the award or based upon earnings of the bank, dividends paid, prior to the fulfillment of all conditions to the compensation received by participants, option receipt of the compensation and; provided further, prices, market value of shares, outstanding shares that such election is irrevocable until at least six or percentages thereof outstanding from time to months after termination of employment; (ii) the time, or similar factors. subsequent crediting of such stock; (iii) the making (ii) With respect to the participation of of- of any election as to the time for delivery of such ficers who are not directors (A) by the board of stock after termination of employment; provided, directors of the bank or a committee of three or that such election is made at least six months prior more directors; or (B) by, or only in accordance to any such delivery; (iv) the fulfillment of any with the recommendations of, a committee of three condition to the absolute right to receive such or more persons having full authority to act in the stock; or (v) the acceptance of certificates for matter, all of the members of which committee shares of such stock. are disinterested persons. For the purposes of (m) Exemption from section 16(b) of longparagraph (1)(2) of this section, a director or com- term profits incident to sales within six months mittee member shall be deemed to be a disin- of the exercise of an option. (1) To the extent terested person only if such person is not at the specified in paragraph (m)(2) of this section, time such discretion is exercised eligible and has transactions involving the purchase and sale, or not at any time within one year prior thereto been sale and purchase, of any equity security of a bank eligible for selection as a person to whom stock shall be exempt from the operation of section may be allocated (or to whom qualified, restricted, 16(b), as not comprehended within the purpose or employee stock purchase plan stock options of that section, if such purchase is pursuant to the may be granted) pursuant to the plan or any other exercise of an option, warrant, or right either— Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

796 Federal Reserve Bulletin • November 1975 (i) Acquired more than six months before its equity securities of a bank holding company as exercise, or defined in the Bank Holding Company Act of (ii) Acquired pursuant to the terms of an 1956, as amended, 12 U.S.C. 1841. employment contract entered into more than six (2) Notwithstanding the foregoing, if an officer, months before its exercise. director, or stockholder shall make any purchase (2) With respect to transactions specified in (other than a purchase exempted by this paragraph paragraph (m)(l) of this section, the profits inuring or any rule under section 16(b) of the Act) of an to the bank pursuant to section 16(b) shall not equity security of any company involved in the exceed the difference between the proceeds of sale merger or consolidation and any sale (other than and the lowest market price of any security of the a sale exempted by this paragraph or any rule same class within six months before or after the under section 16(b) of the Act) of an equity secudate of sale. Nothing in paragraph (m) of this rity in any other company involved in the merger section shall be deemed to enlarge the amount of or consolidation within any period of less than six profit that would inure to the bank in the absence months during which the merger or consolidation of this paragraph. took place, the exemption provided by this rule (3) The disposition of any equity security of a shall be unavailable to such officer, director, or bank shall also be exempt from the operation of stockholder to the extent of such purchase and section 16(b), as not comprehended within the sale. purpose of that section, if purchased in a transac- (o) Exemption from section 16(b) of transaction specified in paragraph (m) of this section tions involving the deposit or withdrawal of pursuant to a plan or agreement for merger or equity securities under a voting trust or deposit consolidation, or reclassification of the bank's seagreement. Any acquisition or disposition of an curities, or for the exchange of its securities for equity security involved in the deposit of such the securities of another person that has acquired security under, or the withdrawal of such security its assets, where the terms of such plan or agreefrom, a voting trust or deposit agreement, and the ment are binding upon all stockholders of the bank acquisition or disposition in connection therewith except to the extent that dissenting stockholders of the certificate representing such security, shall may be entitled, under statutory provisions or be exempt from the operation of section 16(b) of provisions contained in the bank's charter, to rethe Act if substantially all of the assets held under ceive the appraised or fair value of their holdings. the voting trust or deposit agreement immediately (4) The exemptions provided by paragraph (m) after the deposit or immediately prior to the withof this section shall not apply to any transaction drawal, as the case may be, consisted of equity made unlawful by section 16(c) or by any regulasecurities of the same class as the security depostions thereunder. ited or withdrawn; provided, however, that this (5) The burden of establishing market price of rule shall not apply to the extent that there shall a security for the purpose of paragraph (m) of this have been either (i) a purchase of an equity secusection shall rest upon the person claiming the rity of the class deposited and a sale of any exemption. certificate representing an equity security of such (n) Exemption from section 16(b) of disposi- class, or (ii) a sale of an equity security of the tions of equity securities pursuant to certain class deposited and a purchase of any certificate mergers or consolidations incident to formation representing an equity security of such class (othof a bank holding company. (1) There shall be erwise than in a transaction involved in such exempt from the provisions of section 16(b), as deposit or withdrawal or in a transaction exempted not comprehended within the purpose of that sec- by any rule under section 16(b)) within a period tion, the disposition of any equity security, pursu- of less than six months which includes the date ant to a merger or consolidation, of a bank which, of the deposit or withdrawal. prior to said merger or consolidation, held over 85 per cent of the combined assets of all the com- (p) Exemption from section 16(b) of transacpanies undergoing merger or consolidation, as tions involving the conversion of equity securidetermined by reference to their most recent ties. (1) Any acquisition or disposition of an equity available financial statements for a 12-month pe- security involved in the conversion of an equity riod prior to the merger or consolidation, if, in security which, by its terms or pursuant to the such merger or consolidation, there are issued, in terms of the bank's corporate charter or other exchange for such equity securities of such bank governing instruments, is convertible immediately Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 797 or after a stated period of time into another equity a security registered pursuant to section 12 of the security of the same bank, shall be exempt from Act to the holders of which a subscription right the operation of section 16(b) of the Act; provided, is granted. however, that this paragraph shall not apply to the (iii) The term "subject security" means a extent that there shall have been either (i) a pur- security which is the subject of a subscription chase of any equity security of the class convert- right. ible (including any acquisition of or change in a (3) Notwithstanding anything contained herein conversion privilege) and a sale of any equity to the contrary, if a person purchases subscription security of the class issuable upon conversion, or rights for cash or other consideration, then a sale (ii) a sale of any equity security of the class by such person of subscription rights otherwise convertible and any purchase of any equity secu- exempted by this paragraph will not be so exrity issuable upon conversion (otherwise than in empted to the extent of such purchases within the a transaction involved in such conversion or in 6-month period preceding or following such sale. a transaction exempted by any paragraph under (r) Exemption of certain securities from secsection 16(b)) within a period of less than six tion 16(c). Any equity security of a bank shall months which includes the date of conversion. be exempt from the operation of section 16(c) to (2) For the purpose of this paragraph, an equity the extent necessary to render lawful under such security shall not be deemed to be acquired or section the execution by a broker of an order for disposed of upon conversion of an equity security an account in which he had no direct or indirect if the terms of the equity security converted require interest. the payment or entail the receipt, in connection (s) Exemption from section 16(c) of certain with such conversion, of cash or other property transactions effected in connection with a dis- (other than equity securities involved in the con- tribution. Any equity security of a bank shall be version) equal in value at the time of conversion exempt from the operation of section 16(c) to the to more than 15 per cent of the value of the equity extent necessary to render lawful under such secsecurity issued upon conversion. tion any sale made by or on behalf of a dealer (3) For the purpose of this paragraph, an equity in connection with a distribution of a substantial security shall be deemed convertible if it is con- block of the bank's securities, upon the following vertible at the option of the holder or of some conditions: other person or by operation of the terms of the (1) The sale is made with respect to an oversecurity or of the governing instruments. allotment in which the dealer is participating as (q) Exemption from section 16(b) of certain a member of an underwriting group, or the dealer transactions involving the sale of subscription or a person acting on his behalf intends in good rights. (1) Any sale of a subscription right to faith to offset such sale with a security to be acquire any subject security of the same bank shall acquired by or on behalf of the dealer as a particibe exempt from the provision of section 16(b) of pant in an underwriting, selling, or solicitingthe Act, to the extent prescribed in this paragraph, dealer group of which the dealer is a member at as not comprehended within the purpose of said the time of the sale, whether or not the security section, if: to be so acquired is subject to a prior offering (i) Such subscription right is acquired, di- to existing security holders or some other class rectly or indirectly, from the bank without the of persons; and payment of consideration; (2) Other persons not within the purview of (ii) Such subscription right by its terms ex- section 16(c) are participating in the distribution pires within 45 days after the issuance thereof; of such block of securities on terms at least as and favorable as those on which such dealer is partici- (iii) Such subscription right by its terms is pating and to an extent at least equal to the issued on a pro rata basis to all holders of the aggregate participation of all persons exempted beneficiary security of the bank. from the provisions of section 16(c) by paragraph (2) When used within this paragraph the fol- (s) of this section. The performance of the funclowing terms shall have the meaning indicated: tions of manager of a distributing group and the (i) The term "subscription right" means any receipt of a bona fide payment for performing such warrant or certificate evidencing a right to sub- functions shall not, however, preclude an exempscribe to or otherwise acquire an equity security. tion that would otherwise be available under this (ii) The term "beneficiary security" means paragraph. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

798 Federal Reserve Bulletin • November 1975 (t) Exemption of sales of securities to be (1) General, (i) Every verification with respect acquired. (1) Whenever any person is entitled, to financial statements filed pursuant to this Part as an incident to his ownership of an issued equity shall be dated, shall be signed manually, shall security of a bank and without the payment of indicate the city and state where issued, and shall consideration, to receive another security of the identify without detailed enumeration the financial bank "when issued" or "when distributed", the statements covered by the verification. security to be acquired shall be exempt from the (ii) If the person or persons making the verioperation of section 16(c) if : fication considers that he must take exceptions or (i) The sale is made subject to the same express qualifications with respect thereto, each conditions as those attaching to the right of acqui- such exception or qualification shall be stated sition; specifically and clearly and, to the extent practica- (ii) Such person exercises reasonable dili- ble, shall indicate the effect of the matter on the gence to deliver such security to the purchaser financial statements to which it relates. promptly after his right of acquisition matures; and (2) Opinions to be expressed by principal (iii) Such person reports the sale on the ap- accounting officer and auditor. Every verifipropriate form for reporting transactions by per- cation by a bank's principal accounting officer and sons subject to section 16(a). auditor shall state: (2) This paragraph (t) shall not be construed as (i) The opinions of such persons with respect exempting transactions involving both a sale of to the financial statements covered by the verifia security "when issued" or "when distributed" cation and the accounting principles and practices and a sale of the security by virtue of which the reflected therein; and seller expects to receive the "when-issued" or (ii) The opinions of such persons as to any "when-distributed" security, if the two transac- material changes in accounting principles or practions combined result in a sale of more units than tices or in the method of applying the accounting the aggregate of those owned by the seller plus principles or practices, or adjustments of the acthose to be received by him pursuant to his right counts, required to be set forth by paragraph (c)(5) of acquisition. of this section. (u) Arbitrage transactions under section 16. (3) Certification by independent public ac- It shall be unlawful for any director or officer of countants. (i) Qualifications of independent public a bank to effect any foreign or domestic arbitrage accountants— transaction in any equity security of the bank, (A) The Board will not recognize any perunless he shall include such transaction in the son as an independent public accountant who is statements required by section 16(a) of the Act not registered or licensed to practice as a public and § 206.6(a) and shall account to such bank for accountant by a regulatory authority of a State and the profits arising from such transaction, as pro- in good standing with such authority as such an vided in section 16(b). The provisions of section accountant. 16(c) shall not apply to such arbitrage transactions. (B) The Board will not recognize any cer- The provisions of § 206.6(a) and of section 16 tified public accountant or public accountant as shall not apply to any bona fide foreign or domestic independent who is not in fact independent. For arbitrage transaction insofar as it is effected by example, an accountant will be considered not any person other than such director or officer of independent with respect to any person or any of the bank issuing such security. its parents, its subsidiaries, or other affiliates (1) in which, during the period of his professional engagement to examine the financial statements SECTION 206.7—FORM AND being reported on or at the date of his report, he CONTENT OF FINANCIAL STATEMENTS or his firm or a member thereof had, or was (a) Principles of financing reporting. Financial committed to acquire, any direct financial interest statements filed with the Board pursuant to this or any material indirect financial interest, or (2) Part shall be prepared in accordance with generally with which, during the period of his professional accepted accounting principles and practices ap- engagement to examine the financial statements plicable to banks. The Board may from time to being reported on, at the date of his report or time issue releases on accounting principles and during the period covered by the financial statepractices to be used with respect to specific areas. ments, he or his firm or a member thereof was (b) Verification. connected as a promoter, underwriter, voting Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 799 trustee, director, officer, or employee, except that the accounts after the entry of adjustments for the a firm will not be deemed not independent in period under review. regard to a particular person if a former officer (iv) Exceptions. If the accountant making the or employee of such person is employed by the report considers that he must take exceptions or firm and such individual has completely disasso- express qualifications with respect thereto, each ciated himself from the person and its affiliates such exception or qualification shall be stated and does not participate in auditing financial state- specifically and clearly and, to the extent practicaments of the person or its affiliates covering any ble, shall indicate the effect of the matter on the period of his employment by the person. For the financial statements to which it relates. purposes of section 206.7 the term "member" (v) Certification of financial statements by means all partners in the firm and all professional more than one independent public accountant. If, employees participating in the audit or located in with respect to the certification of the financial an office of the firm participating in a significant statements of any bank, the principal independent portion of the audit. public accountant relies on an examination made (C) In determining whether a public ac- by another independent public accountant of cercountant is in fact, independent with respect to tain of the accounts of such bank or its affiliates, a particular person, the Board will give appropriate the certificate of such other accountant shall be consideration to all relevant circumstances, in- filed (and the provisions of this subparagraph shall cluding evidence bearing on all relationships be- be applicable thereto); however, the certificate of tween the accountant and that person or any affili- such other accountant need not be filed (a) if no ate thereof, and will not confine itself to the reference is made directly or indirectly to such relationships existing in connection with the filing other accountant's examination in the principal of reports with the Board. accountant's certificate, or (b) if, having referred (ii) Representations as to the audit. The inde- to such other accountant's examination, the pendent public accountant's certificate— principal accountant states in his certificate that (A) shall state whether the audit was made he assumes responsibility for such other accountin accordance with generally accepted auditing ant's examination in the same manner as if it had standards; and been made by him. (B) shall designate any auditing procedures (c) Provisions of general application. generally recognized as normal (or deemed neces- (1) Requirements as to form. Financial statesary by the accountant under the circumstances of ments shall be prepared in accordance with the the particular case) that have been omitted, and applicable requirements of Forms 9 A, B, C, and the reasons for their omission, but no procedure D. All money amounts required to be shown in that independent accountants ordinarily employ in financial statements may be expressed in even the course of an audit made for the purpose of dollars or thousands of dollars. If shown in even expressing the opinions required by clause (iii) thousands, an indication to that effect shall be below shall be omitted. inserted immediately beneath the caption of the (iii) Opinions to be expressed. The inde- statement or schedule, or at the top of each money pendent public accountant's certificate shall column. The individual amounts shown need not state— be adjusted to the nearest dollar or thousand if (A) The opinion of the accountant with the failure of the items to add to the totals shown respect to the financial statements covered by the is stated in a note as due to the dropping of certificate and the accounting principles and prac- amounts of less than $1 or $1,000, as appropriate. tices reflected therein; (2) Items not material. If the amount that (B) The opinion of the accountant as to would otherwise be required to be shown with any material changes in accounting principles or respect to any item is not material, it need not practices or in the method of applying the ac- be separately set forth. counting principles or practices, or adjustments of (3) Inapplicable captions and omission of the accounts, required to be set forth by paragraph unrequired or inapplicable financial state- (c)(5) of this section; and ments. No caption need be shown in any financial (C) The nature of, and the opinion of the statement required by the forms set forth in this accountant as to, any material differences between Part as to which the items and conditions are not the accounting principles and practices reflected present. Financial statements not required or inapin the financial statements and those reflected in plicable because the required matter is not present Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

800 Federal Reserve Bulletin • November 1975 need not be filed, but the statements omitted and (i) Total rental expense (reduced by rentals the reasons for their omission shall be indicated from subleases, with disclosure of such amounts) in the list of financial statements required by the entering into the determination of results of operaapplicable form. tions for each period for which an income state- (4) Additional information. In addition to the ment is presented shall be disclosed. Rental payments under short-term leases for a month or less information required with respect to any financial which are not expected to be renewed need not statement, such further information shall be furbe included. Contingent rentals, such as those nished as is necessary to make the required statebased upon usage or sales, shall be reported ments, in the light of the circumstances under separately from the basic or minimum rentals. which they are made, not misleading. Rentals on noncapitalized financing leases shall be (5) Changes in accounting principles and shown separately for both categories of rentals practices and retroactive adjustments of acreported. counts. Any change in accounting principle or (ii) The minimum rental commitments under practice, or in the method of applying any acall noncancelable leases shall be disclosed, as of counting principle or practice, made during any the date of the latest balance sheet presented, in period for which financial statements are filed that the aggregate (with disclosure of the amounts affects comparability of such financial statements applicable to noncapitalized financing leases) for with those of prior or future periods, and the effect (A) each of the five succeeding fiscal years; (B) thereof upon the net income for each period for each of the next 3 five-year periods; and (C) the which financial statements are filed, shall be disremainder as a single amount. The amounts so closed in a note to the appropriate financial statedetermined should be reduced by rentals to be ment. Any material retroactive adjustment made received from existing noncancelable subleases during any period for which financial statements (with disclosure of the amounts of such rentals). are filed, and the effect thereof upon net income For purposes of this rule, a noncancelable lease of prior periods, shall be disclosed in a note to is defined as one that has an initial or remaining the appropriate financial statement. term of more than one year and is noncancelable, (6) Summary of accounting principles and or is cancelable only upon the occurrence of some practices. Information required in notes as to remote contingency or upon the payment of a accounting principles and practices reflected in the substantial penalty. financial statements may be presented in the form (iii) Additional disclosures shall be made to of a single statement. In such a case specific report in general terms: (A) the basis for calculatreferences shall be made in the appropriate finaning rental payments if dependent upon factors cial statement to the applicable portion of such other than the lapse of time; (B) existence and single statement. terms of renewal or purchase options, escalation (7) Foreign currencies. The basis of conversion clauses, etc.; (C) the nature and amount of related of all items in foreign currencies shall be stated, guarantees made or obligations assumed; (D) reand the amount and disposition of the resulting strictions on paying dividends, incurring additional unrealized profit or loss shown. Disclosure should debt, further leasing, etc.; and (E) any other inbe made as to the effect, insofar as this can be formation necessary to assess the effect of lease reasonably determined, of foreign exchange re- commitments upon the financial position, results strictions upon the consolidated financial position of operations, and changes in financial position of and operating results of the bank and its subsidi- the lessee. aries. (9) General notes to balance sheets. If present (8) Commitments. If material in amount, the with respect to the person for which the statement pertinent facts relative to firm commitments for is filed, the following shall be set forth in the the acquisition, directly or indirectly, of fixed balance sheet or in referenced notes thereto: assets and for the purchase, repurchase, con- (i) Assets subject to lien. The amounts of struction, or rental of assets under long-term leases assets mortgaged, pledged, or otherwise subject shall be stated briefly in the balance sheet or in to a lien or security interest shall be designated footnotes referred to therein. Where the rentals or and the obligation secured thereby, if any, shall obligations under long-term leases are material the be identified briefly. following shall be set forth in a note to the appro- (ii) Intercompany profits and losses. The efpriate financial statement: fect upon any balance sheet item of profits or losses Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 801 resulting from transactions with affiliated compa- shares under option at the balance sheet date, and nies not consolidated shall be stated. If imprac- the option price and the fair value thereof (per ticable of accurate determination without unrea- share and in total) at the dates the options were sonable effort or expense, an estimate or explana- granted; the number of shares with respect to tion shall be given. which options became exercisable during the pe- (iii) Preferrred shares. (A) If convertible, the riod, and the option price and the fair value thereof terms of the conversion shall be described briefly; (per share and in total) at the dates the options (B) if callable, the date or dates and the amount became exercisable; the number of shares with per share at which such shares are callable shall respect to which options were exercised during the be stated; (C) arrears in cumulative dividends per period, and the option price and the fair value share and in total for each class of shares shall thereof (per share and in total) at the dates the be stated; and (D) aggregate preferences on invol- options were exercised; and the number of unopuntary liquidation, if other than the par or stated tioned shares available at the beginning and at the value, shall be shown parenthetically in the equity close of the latest period presented, for the grantsection of the balance sheet. When the excess ing of options under an option plan. A brief involved is material, there shall be shown the description of the terms of each other arrangement difference between the aggregate preference on covering shares sold or offered for sale to only involuntary liquidation and the aggregate par or directors, officers, and key employees shall be stated value, a statement that this difference (plus given, including the number of shares, and the any arrears in dividends) exceeds the sum of the offered price and the fair value thereof (per share par or stated value of the junior capital shares, and in total) at the dates of sale or offer to sell, surplus, and undivided profits if such is the case, as appropriate. The required information may be and a statement as to the existence (or absence) summarized as appropriate with respect to each of any restrictions upon surplus and/or undivided of the categories referred to in this subclause; profits growing out of the fact that upon involun- (C) The basis of accounting for such option tary liquidation the preference of the preferred arrangements and the amount of charges, if any, stock exceeds its par or stated value. reflected in income with respect thereto shall be (iv) Pension and retirement plans. (A) A brief stated. description of the essential provisions of any em- (vi) Restrictions that limit the availability of ployee pension or retirement plan shall be given; surplus and/or undivided profits for dividend pur- (B) The estimated annual cost of the plan shall poses. Any such restriction, other than as reported be stated; (C) If a plan has not been funded or in paragraph (c)(9) (iii) of this section shall be otherwise provided for, the estimated amount that described, indicating briefly its source, its pertiwould be necessary to fund or otherwise provide nent provisions, and, where appropriate and defor the past-service cost of the plan shall be dis- terminable, the amount of the surplus and/or unclosed; (D) The excess, if any, of the actually divided profits so restricted. computed value of vested benefits over the total (vii) Contingent liabilities. A brief statement of the pension fund and any balance sheet pension as to contingent liabilities not reflected in the accruals, less any pension prepayments or deferred balance sheet shall be made. charges, shall be given as the most recent practi- (viii) Standby letters of credit. State the cable date; and (E) A statement shall be given amount of outstanding "standby letters of credit." of the nature and effect of significant matters For the purpose of this paragraph, "standby letters affecting comparability of pension cost for any of credit" include every letter of credit (or similar periods for which income statements are pre- arrangement however named or designated) which sented. represents an obligation to the beneficiary on the (v) Capital stock optioned to officers and part of the issuing bank (A) to repay money employees. (A) A brief description of the terms borrowed by or advanced to or for the account of each option arrangement shall be given, includ- of the account party or (B) to make payment on ing the title and amount of securities subject to account of any evidence of indebtedness underthe option, the year or years during which the taken by the account party, or (C) to make payoptions were granted, and the year or years during ment on account of any default by the account which the optionees became, or will become, party in the performance of an obligation,2 except entitled to exercise the options; (B) There shall be stated the number of See following page for footnote 2. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

802 Federal Reserve Bulletin • November 1975 that, if prior to or at the time of issuance of a determination without unreasonable effort and exstandby letter of credit, the issuing bank is paid pense, an estimate or explanation shall be given. an amount equal to the bank's maximum liability (ii) Depreciation and amortization. For the under the standby letter of credit, or has set aside period of which statements of income are filed, sufficient funds in a segregated, clearly earmarked there shall be stated the policy followed with deposit account to cover the bank's maximum respect to: liability under the standby letter of credit, then (A) The provision for depreciation of the amount of that standby letter or credit need physical properties or valuation allowances created not be stated. in lieu thereof, including the methods and, if (ix) Defaults. The facts and amounts con- practicable, the rates used in computing the annual cerning any default in principal, interest, sinking amounts; fund, or redemption provisions with respect to any (B) The provision for depreciation and issue of securities or credit agreements, or any amortization of intangibles, or valuation allowbreach of covenant of a related indenture or ances created in lieu thereof, including the agreement, which default or breach existed at the methods and, if practicable, the rates used in date of the most recent balance sheet being filed computing the annual amounts; and which has not been subsequently cured, shall (C) The accounting treatment for maintebe stated. Notation of such default or breach of nance, repairs, renewals, and improvements; and covenant shall be made in the financial statements (D) The adjustment of the accumulated and the entire amount of obligations to which the valuation allowances for depreciation and amortidefault or breach relates shall be classified as a zation at the time the properties were retired or current liability if said default or breach accelerates otherwise disposed of, including the disposition the maturity of the obligations and makes it current made of any profit or loss on sale of such properunder the terms of the related indenture or agree- ties. ment. Classification as a current obligation is not (iii) Bonus, profit sharing, and other similar required if the lender has waived the accelerated plans. Describe the essential provisions of any due date or otherwise agreed to a due date more such plans in which only directors, officers or key than one year from the balance sheet date. If a employees may participate, and state, for each of default or breach exists, but acceleration of the the fiscal periods for which income statements are obligation has been waived for a stated period of required to be filed, the aggregate amount provided time beyond the date of the most recent balance for all plans by charges to expense. sheet being filed, state the amount of the obligation (iv) Income tax expense, (a) Disclosure shall and the period of the waiver. be made, in the income statement or a note thereto, (x) Significant changes in bonds, mortgages, of the components of income tax expense, includand similar debt. Any significant changes in the ing: (1) taxes currently payable; (2) the net tax authorized or issued amounts of bonds, mortgages, effects, as applicable, of (i) timing differences; and similar debt since the date of the latest balance (types of timing differences that are individually sheet being filed for a particular person or group less than 15 per cent of the deferred tax amount shall be stated. in the income statement may be combined; if no (10) General notes to statements of income. individual type of difference is more than 5 per If present with respect to the person for which cent of the amount computed by multiplying the the statement is filed, the following shall be set income before tax by the applicable statutory Fedforth in the statement of income or in referenced eral income tax rate and the aggregate amount of notes thereto: timing differences is less than 5 per cent of such (i) Intercompany profits and losses. The computed amount, disclosure of each of the sepaamount of any profits or losses resulting from rate types of timing differences may be omitted) transactions between unconsolidated affiliated and (ii) operating losses; and (3) the net deferred companies shall be stated. If impracticable of investment tax credits. Amounts applicable to United States Federal income taxes, to foreign income taxes and to other income taxes shall be stated separately for each major component, unless 2 As defined, "standby letter of credit" would not include (1) commercial letters of credit and similar instruments where the amounts applicable to foreign and other income the issuing bank expects the beneficiary to draw upon the issuer taxes do not exceed 5 per cent of the total for and which do not "guaranty" payment of a money obligation or (2) a guaranty or similar obligation issued by a foreign the component, (b) Provide a reconciliation bebranch in accordance with and subject to the limitations of tween the amount of reported total income tax Regulation M. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 803 expense and the amount computed by multiplying not be disclosed if the method asserted by the the income before tax by the applicable statutory former accountant ceases to be generally accepted Federal income tax rate, showing the estimated because of authoritative standards or interpretadollar amount of each of the underlying causes tions subsequently issued. for the difference. If no individual reconciling item (d) Consolidated financial statements. (1) amounts to more than 5 per cent of the amount Consolidated statements generally present more computed by multiplying the income before tax meaningful information to the investor than unby the applicable statutory Federal income tax rate, consolidated statements. Except where good reaand the total difference to be reconciled is less son exists, consolidated statements of the bank and than 5 per cent of such computed amount, no its majority-owned significant subsidiaries should reconciliation need be provided unless it would be filed. be significant in appraising the trend of earnings. (2) Every majority-owned bank-premises sub- Reconciling items that are individually less than sidiary and every majority-owned subsidiary 5 per cent of the computed amount may be aggre- operating under the provisions of Section 25 or gated in the reconciliation. The reconciliation may Section 25(a) of the Federal Reserve Act be presented in percentages rather than in dollar ("Agreement Corporation'' and "Edge Act Coramounts. porations") shall be consolidated with that of the (v) Interest capitalized, (a) The amount of reporting bank irrespective of whether such subinterest cost capitalized in each period for which sidiary is a significant subsidiary. an income statement is presented shall be shown (3) If the financial statements of a subsidiary within the income statement. Banks which follow are as of a date or for periods different from those a policy of capitalizing interest cost shall make of the bank, such statements may be used as the the following additional disclosures required by basis for consolidation of the subsidiary only if items (b) and (c) below, (b) The reason for the the date of such statements is not more than 93 policy of interest capitalization and the way in days from the date of the close of the bank's fiscal which the amount to be capitalized is determined, year; the closing date of the subsidiary is specified; (c) The effect on net income for each period for the necessity for the use of different closing dates which an income statement is presented of follow- is explained briefly; and any changes in the reing a policy of capitalizing interest as compared spective fiscal periods of the bank and the subsidito a policy of charging interest to expense as ary made during the period of report are indicated incurred. clearly. (vi) Disagreements on accounting and finan- (4) There shall be set forth in a note to each cial disclosure matters. If, within the twenty-four consolidated balance sheet filed a statement of any months prior to the date of the most recent finan- difference between the investment in subsidiaries cial statements, a Form F-3 has been filed reporting consolidated, as shown by the bank's books, and a change of accountants and included in such filing the bank's equity in the net assets of such subsidithere is a reported disagreement on any matter of aries as shown by the subsidiaries' books. If any accounting principles or practices or financial such difference exists, there shall be set forth the statement disclosure, and if such disagreement, if amount of the difference and the disposition made differently resolved, would have caused the finan- thereof in preparing the consolidated statements, cial statements to differ materially from those naming the balance sheet captions and stating the filed, state the existence and nature of the dis- amount included in each. agreement. In addition, if during the fiscal year (5) There may be filed financial statements in in which the change in accountants took place or which majority-owned subsidiaries not consoliduring the subsequent fiscal year there have been dated with the parent are consolidated or combined any transactions or events similar to those which in one or more groups, and 50 per cent or less involved a reported disagreement and if such owned persons, the investments in which are actransactions are material and were accounted for counted for by the equity method are consolidated or disclosed in a manner different from that which or combined in one or more groups, pursuant to the former accountants apparently concluded was principles of inclusion or exclusion which will required, state the effect on the financial statements clearly exhibit the financial position and results of if the method which the former accountant ap- operations of the group or groups. parently concluded was required had been fol- (6) A brief description of the principles followed lowed. The effects on the financial statements need in consolidating or combining the separate finan- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

804 Federal Reserve Bulletin • November 1975 cial statements, including the principles followed MEMBERSHIP OF in determining the inclusion or exclusion of (i) STATE BANKING INSTITUTIONS subsidiaries in consolidated or combined financial IN THE FEDERAL RESERVE SYSTEM statements and (ii) companies in consolidated or combined financial statements, shall be stated in The Board of Governors has amended its Reguthe notes to the respective financial statements. lation H to require State member banks acting as (7) As to each consolidated financial statement transfer agents to register with the Board. and as to each combined financial statement, if there has been a change in the persons included A M E N D M E NT TO R E G U L A T I ON H or excluded in the corresponding statement for the preceding fiscal period filed with the Board which Effective December 1, 1975, paragraph 208.8(f) has a material effect on the financial statements, is added to read as follows: the persons included and the persons excluded shall be disclosed. If there have been any changes SECTION 208.8—BANKING PRACTICES in the respective fiscal periods of the persons included made during the periods of the report which have a material effect on the financial state- (f) State member banks as transfer agents. ments, indicate clearly such changes and the man- (1) On or after December 1, 1975, no State memner of treatment. ber bank or any of its subsidiaries shall act as (e) Statement of changes in capital accounts. transfer agent, as defined in Section 3(a)(25) of A statement of changes in capital accounts shall the Securities Exchange Act of 1934 ("Act"), be filed with each statement of income filed pursu- with respect to any security registered under Secant to this Part. tion 12 of the Act or which would be required (f) Statement of changes in financial position. to be registered except for the exemption from A statement of changes in financial position shall registration provided by subsection (g)(2)(B) or be filed with each statement of income filed pursu- (g)(2)(G) of that Section, unless it shall have filed ant to this Part. a registration statement with the Board in con- (g) Schedules to be filed. (1) The following formity with the requirements of Form TA-1,1 schedules shall be filed with each balance sheet which registration statement shall have become filed pursuant to this Part: Schedule I—U.S. effective as hereinafter provided. Any registration Treasury Securities, Securities of Other U.S. Gov- statement filed by a State member bank or its ernment Agencies and Corporations, and Obliga- subsidiary shall become effective on the thirtieth tions of States and Political Subdivisions; Sched- day after filing with the Board unless the Board ule II—Other Securities; Schedule III—Other takes affirmative action to accelerate, deny or Loans; Schedule IV—Bank Premises and Equip- postpone such registration in accordance with the ment; Schedule V—Investments in, Dividend In- provisions of Section 17A(c) of the Act. Such come from, and Share in Earnings or Losses of filings with the Board will constitute filings with Unconsolidated Subsidiaries; and Schedule VI— the Securities and Exchange Commission for pur- "Other" Liabilities for Borrowed Money. poses of Section 17(c)(1) of the Act. (2) The following schedule shall be filed with (2) If the information contained in Items 1-6 each statement of income filed pursuant to this of Form TA-1 becomes inaccurate, misleading or Part: Schedule VII—Allowance for Possible Loan incomplete for any reason, the bank or its subsidi- Losses. ary shall, within twenty-one calendar days there- (3) Reference to the schedules referred to in after, file an amendment to Form TA-1 correcting subparagraphs (1) and (2) shall be made against the inaccurate, misleading or incomplete informathe appropriate captions of the balance sheet or tion. Within thirty calendar days following the statement of income. close of any calendar year (beginning with the period from the date as of which the registration statement is prepared to December 31, 1976) during which the information required by Item 7 of NOTE.—Forms for proxy statements, annual report to shareholders, stock ownership reports of officers and directors, financial statements, and other reports filed under this Regula- Copies of Form TA-1 are available upon request to any tion are available upon request to any Federal Reserve Bank. Federal Reserve Bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 805 Form TA-1 becomes inaccurate, misleading or (3) Each registration statement on Form TA-1 incomplete, the bank or its subsidiary shall file or amendment thereto shall constitute a "report" an amendment to Form TA-1 correcting the inac- or "application" within the meaning of Sections curate, misleading or incomplete information. 17, 17A(c) and 32(a) of the Act. B A NK H O L D I NG C O M P A NY A ND B A NK M E R G ER O R D E RS ISSUED BY T HE B O A RD OF G O V E R N O RS ORDERS UNDER SECTION 3 summation of the proposal herein would not elim- OF BANK HOLDING COMPANY ACT inate existing or potential competition, nor have an adverse effect on other area banks. CITIZENS BANCORPORATION, Applicant's principal is also a principal in The CHARLES CITY, IOWA Kanabec Credit Company, Mora, Minnesota, a registered one-bank holding company, which owns Order Denying 84 per cent of The Kanabec State Bank, Mora, Formation of Bank Holding Company Minnesota. In addition, this individual and his Citizens Bancorporation, Charles City, Iowa, brother together own 88 per cent of The Sibley has applied for the Board's approval under § County Bank, Henderson, Minnesota. Since both 3(a)(1) of the Bank Holding Company Act (12 of these banks are located in banking markets U.S.C. 1842(a)(1)) of formation of a bank holding separate from the relevant market in this case, and company through acquisition of 80 per cent or the closest one is approximately 140 miles from more of the voting shares of The Citizens National Bank, consummation of the proposal would elimi- Bank of. Charles City, Charles City, Iowa nate no existing competition. Therefore, competi- ("Bank"). tive considerations are consistent with approval of Notice of the application, affording opportunity the application. for interested persons to submit comments and The Board has indicated on previous occasions views, has been given in accordance with § 3(b) that it believes that a holding company should of the Act. The time for filing comments and views provide a source of strength to its subsidiary has expired, and the Board has considered the bank(s) and that every proposed formation and application and all comments received in light of acquisition will be closely examined with this the factors set forth in § 3(c) of the Act (12 U.S.C. consideration in mind. With respect to the present 1842(c)). proposal, Applicant would incur substantial debt Applicant, a non-operating company with no which Applicant proposes to service over a 12-year subsidiaries, was organized for the purpose of period through dividends from Bank. In the becoming a bank holding company through the Board's view, the projected earnings of Applicant acquisition of Bank ($14.6 million in deposits).1 do not appear to provide Applicant with the nec- Bank is the third largest of five banks operating essary financial flexibility to service its debt as well in the Charles City banking market2 and controls as to serve as a financial source of strength to Bank approximately 19 per cent of the total commercial and to meet unexpected problems. Futhermore, the bank deposits therein. Upon acquisition of Bank, Board notes with concern the highly leveraged Applicant would control the 215th largest bank in condition of The Kanabec Credit Company as well Iowa, holding .14 per cent of total deposits in as the high level of debt incurrred by Applicant's commercial banks in the State. Since the purpose principal in acquiring The Sibley County Bank and of the proposed transaction is to effect a transfer Bank. This situation could impair the ability of of the ownership of Bank from individuals to a Applicant's principal to aid Applicant in the event corporation owned by the same individuals, con- it incurs problems servicing its acquisition debt while at the same time maintaining an adequate captial account at Bank. While the Board recognizes that denial herein cannot affect present rela- 1 All banking data are as of December 31, 1974. tionships, the Board believes that it should not 2 The Charles City banking market is approximated by Floyd approve a holding company debt structure that County, except for the town of Nora Springs, and includes the town of Nashua in Chickasaw County. could impair the financial condition of Bank, nor Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

806 Federal Reserve Bulletin • November 1975 would the public interest be served by such Board of the Act. The time for filing comments and views action. Therefore, on the basis of these and other has expired, and the Board has considered the facts of record, the Board has determined that application and all comments received in light of considerations relating to financial factors lend the factors set forth in § 3(c) of the Act (12 U.S.C. weight toward denial of the application. 1842(c)). Applicant has proposed some changes which Applicant is a nonoperating corporation orgacould benefit the community, including certain nized under the laws of Oklahoma for the purpose fiduciary services, a strengthened agricultural of becoming a bank holding company through the lending program, and the future use of electronic acquisition of Bank. With deposits of $4.7 milterminal devices. However, the introduction of lion,1 Bank holds approximately .15 of one per these services is not dependent upon formation of cent of the total deposits held by commercial banks Applicant as a bank holding company and, in any in the Oklahoma City banking market (the relevant event, does not outweigh the aforementioned ad- banking market),2 and is one of the smaller orgaverse banking factors connected with this pro- nizations competing in that market. Inasmuch as posal . this proposal represents merely a reorganization On the basis of all of the circumstances con- of existing ownership interests, and since Applicerning this application, the Board concludes that cant has no present banking subsidiaries, the acthe financial considerations involved in this pro- quisition of Bank by Applicant would not have posal present adverse circumstances bearing upon any significant adverse effect upon either actual the financial condition and prospects of both Ap- or potential competition within the relevant marplicant and Bank. Such adverse factors are not ket. Accordingly, the Board concludes that comoutweighed by any procompetitive effects or by petitive considerations are consistent with approval benefits which would result in serving the conven- of the application. ience and needs of the community. Accordingly, The Board has previously indicated that it beit is the Board's judgment that approval of the lieves that a holding company should be a source application would not be in the public interest and of financial and managerial strength to its subsidithat the application should be denied. ary bank(s), and that it will closely examine the On the basis of the record, the application condition of the Applicant in each case with this is denied for the reasons summarized above. consideration in mind. Applicant will incur a rela- By order of the Board of Governors, effective tively large acquisition debt in connection with this October 24, 1975. proposal, which it proposes to service over a 12-year period primarily through dividends from Voting for this action: Vice Chairman Mitchell and Bank. In the Board's view, the projected earnings Governors Bucher, Coldwell, and Jackson. Absent and of Applicant over the debt-retirement period apnot voting: Chairman Burns and Governors Holland and Wallich. pear to be somewhat optimistic in view of Bank's previous earnings. Furthermore, even if antici- (Signed) THEODORE E. ALLISON, pated earnings are actually realized, the debt serv- [SEAL] Secretary of the Board. icing requirements imposed on Applicant would limit Applicant's ability to meet any unforeseen CITIZENS BANCORP, financial problems that might arise, and thereby MAUD, OKLAHOMA impair Bank's overall ability to continue to serve the community as a viable banking organization. Order Denying Accordingly, the Board views the sizable acquisi- Formation of Bank Holding Company tion debt to be incurred by Applicant as a signifi- Citizens Bancorp, Maud, Oklahoma, has ap- cantly adverse factor in the consideration of the plied for the Board's approval under § 3(a)(1) of subject proposal and finds that the financial factors the Bank Holding Company Act (12 U.S.C. weigh against approval of the application. 1842(a)(1)) of formation of a bank holding company through the acquisition of 80 per cent or more of the voting shares of Citizens State Bank, Maud, Oklahoma ("Bank"). 1 All banking data are as of December 31, 1974. Notice of the application, affording opportunity 2The Oklahoma City banking market is approximated by the Oklahoma City SMSA which is defined to include the for interested persons to submit comments and counties of Canadian, Cleveland, McClaine, Oklahoma and views, has been given in accordance with § 3(b) Pottawatomie. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 807 In its consideration of this proposal, the Board COMMERCIAL BANKSHARES, INC., also notes that Applicant's principals acquired GRAND ISLAND, NEBRASKA their original interest in Bank through a loan Order Approving obtained from a third party bank. Under this pro- Formation of Bank Holding Company posal, Applicant would assume the debt resulting from this loan to its principals. Analysis of the Commercial Bankshares, Inc., Grand Island, history of Bank's deposits kept with the lending Nebraska, has applied for the Board's approval bank as well as Bank's previous correspondent under § 3(a)(1) of the Bank Holding Company Act balance history leads the Board to the conclusion (12 U.S.C. § 1842(a)(1)) of formation of a bank that the debt being assumed, which is at an annual holding company through acquisition of 88.9 per interest rate of 5.75 per cent, is being financed cent or more of the voting shares of Commercial in part by the maintenance of a large compensating National Bank & Trust Company, Grand Island, balance by Bank at the lending institution. Further, Nebraska ("Bank"). it appears that the management group has been Notice of the application, affording opportunity receiving salaries and retainers from Bank which for interested persons to submit comments and are considered excessive in relation to services views, has been given in accordance with § 3(b) rendered. To the extent that these practices exist of the Act. The time for filing comments and views they constitute a use of Bank assets to the detrihas expired, and the Board has considered the ment of the minority shareholders of Bank and application and all comments received in light of therefore reflect adversely on managerial considthe factors set forth in § 3(c) of the Act (12 U.S.C. erations. § 1842(c)). As indicated above, the proposed formation Applicant is a corporation organized under the essentially involves the reorganization of the own- laws of the State of Nebraska for the purpose of ership interest of Bank without any significant becoming a bank holding company through the changes in Bank's operations or the services of- acquisition of Bank. In the relevant banking marfered to customers of Bank. Consequently, con- ket (approximated by Hall County, Nebraska), siderations relating to the convenience and needs Bank (deposits of $47.8 million)1 is the second of the community to be served lend no weight largest of seven commercial banks and controls toward approval of the application. approximately 24.1 per cent of the total deposits On the basis of all of the circumstances con- held by commercial banks in that market.2 cerning this application, the Board concludes that Through eight other one-bank holding companies, the banking considerations involved in this pro- certain principals of Applicant also have interests posal present adverse factors bearing upon the in six banks in Colorado and two banks in Nefinancial conditions and managerial resources of braska. However, none of the other banks in which both Applicant and Bank. Such adverse factors are principals of Applicant are involved compete with not outweighed by any procompetitive effects or Bank to any significant extent. Furthermore, inasby benefits that would result concerning the con- much as the present proposal involves a transfer venience and needs of the community. Accord- of the ownership of Bank from individuals to a ingly, it is the Board's judgment that approval of corporation controlled essentially by those same the application would not be in the public interest individuals, and Applicant has no present banking and that the application should be denied. subsidiaries, it appears that the acquisition of Bank On the basis of the facts of record, the applica- by Applicant would not have any significantly tion is denied for the reasons summarized above. adverse effect upon either existing or potential By order of the Board of Governors, effective competition within the relevant market. Accord- October 6, 1975. ingly, on the basis of record, the Board concludes that competitive considerations are consistent with approval of the application. Voting for this action: Governors Bucher, Holland, Wallich, Coldwell, and Jackson. Absent and not voting: Chairman Burns and Governor Mitchell. *A11 banking data are as of December 31, 1974, unless otherwise indicated. (Signed) THEODORE E. ALLISON, 2Of these seven banks, four (including the market's three [SEAL] Secretary of the Board. largest) are located in the city of Grand Island, Nebraska. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

808 Federal Reserve Bulletin • November 1975 Under the Bank Holding Company Act, the without impairing the capital of those companies' Board is required to consider the financial and respective subsidiary banks. In general, it appears managerial resources and future prospects of the that the overall financial condition of Applicant bank holding company involved and the bank to and of the other one-bank holding companies in be acquired. In the exercise of that responsibility, which principals of Applicant are involved is satthe Board has previously indicated its concern isfactory and consistent with approval of the apabout the utilization of significant acquisition debt plication. With respect to convenience and needs and the effect that such debt may have on the considerations, it appears that there have been overall financial prospects of the holding company numerous improvements in Bank's operations, and the bank involved. In acting on one-bank such as increasing banking hours, new and exholding company formations, the Board has been panded services, and increased community insomewhat liberal in the financial standards that it volvement since the time that Applicant's has applied in cases where the current or prospec- principals acquired control of Bank. Such considtive owner-chief executive is establishing a one- erations relating to the convenience and needs of bank holding company to hold direct equity inter- the community to be served are consistent with est in his bank. The Board regards such a policy approval of the application. as being in the public interest in order to facilitate Accordingly, on the basis of the above, in management succession on the community level addition to other facts of record, the Board conat the Nation's many smaller, independent banks.3 cludes that considerations relating to the financial However, the Board does not believe as a gen- condition, resources, and prospects of Applicant eral matter that such liberality should pertain to are consistent with approval of the application. situations where individuals are involved in more The Board also regards managerial considerations than one one-bank holding company, such as and benefits that would result in the convenience where individuals are engaged in establishing a and needs of the community to be served as being series or chain of one-bank holding companies. consistent with approval of the application. It is In such situations, the Board believes it more the Board's judgment that consummation of the appropriate to analyze such organizations under holding company formation would be in the public the more restrictive financial standards that are interest and that the application to acquire Bank normally used in analyzing multi-bank holding should be approved. companies. Such analysis appears appropriate in On the basis of the record, the application is such circumstances because of the financial in- approved for the reasons summarized above. The terdependence regularly exhibited by a chain of transaction shall not be made (a) before the thircommonly owned one-bank holding companies tieth calendar day following the effective date of and the distinct possibility that the resources of this Order, or (b) later than three months after the one or more banks in the chain may be used to effective date of this Order, unless such period support the operations of other members of the is extended for good cause by the Board, or by banking group. the Federal Reserve Bank of Kansas City pursuant Even applying the more restrictive financial to delegated authority. standards normally used in analyzing multi-bank By order of the Board of Governors, effective holding companies, the Board finds that financial October 17, 1975. considerations relating to the present proposal are Voting for this action: Chairman Burns and Goverconsistent with approval of the application. nors Bucher, Holland, and Jackson. Voting against this Although Applicant will incur acquisition debt action: Governor Mitchell. Absent and not voting: Governors Wallich and Coldwell. in connection with this proposal, it appears that Applicant will be able to service this debt over (Signed) THEODORE E. ALLISON, a twelve-year period without impairing the finan- [SEAL] Secretary of the Board. cial condition of Bank during that period. In addition, Applicant's principals have demonstrated SOUTHEASTERN BANCSHARES, INC., their ability to service the debt of the eight other BROKEN BOW, OKLAHOMA one-bank holding companies under their control Order Approving 3See Board's Order dated January 15, 1974, denying the Formation of Bank Holding Company application for Board approval of the formation of a bank holding company filed under Section 3 of the Act by BHCo., Southeastern Bancshares, Inc., Broken Bow, Inc., Hardin, Montana [60 Federal Reserve BULLETIN 123 (1974), 39 Federal Register 2643 (1974)]. Oklahoma, has applied for the Board's approval Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 809 under § 3(a)(1) of the Bank Holding Company Act assume incident to this proposal over a twelve year (12 U.S.C. § 1842(a)(1)) of formation of a bank period through dividends from Bank. In light of holding company through acquisition of 100 per Bank's past earnings and its anticipated growth, cent of the voting shares, less directors' qualifying the projected earnings of Bank appear reasonable shares, of 1st Bank & Trust, Broken Bow, Okla- and would provide Applicant with the necessary homa ("Bank"). financial flexibility to meet its annual debt servic- Notice of the application, affording opportunity ing and preferred stock dividend requirements and for interested persons to submit comments and to maintain an adequate capital position for Bank. views, has been given in accordance with § 3(b) Moreover, Applicant intends to inject $300 thouof the Act. The time for filing comments and views sand in additional capital into Bank shortly after has expired, and the Board has considered the consummation of this transaction. The managerial application and all comments received in light of resources of Applicant and Bank are considered the factors set forth in § 3(c) of the Act (12 U.S.C. satisfactory and the future prospects for each ap- § 1842(c)). pear favorable. Applicant is a recently organized corporation As noted above, Applicant's principal is also formed for the purpose of becoming a bank hold- involved with Idabel Bank. A factor lending ing company through the acquisition of Bank. weight toward approval of the subject application Bank (deposits of $19.8 million)1 is the second is the fact that permitting the principal of Applicant largest of five banks in the McCurtain banking to place his interest in Bank in a holding company market2 and controls approximately 27 per cent structure will relieve the principal from some adof the total deposits in commercial banks in the ditional debt associated with his initial acquisition market. Upon acquisition of Bank, Applicant of Bank. As a result, Applicant's principal will would control 0.2 of one per cent of the total have greater financial flexibility in his efforts to deposits in commercial banks in Oklahoma. strengthen the overall financial condition of Idabel The principal shareholder of Applicant also Bank. Accordingly, on the basis of the foregoing controls First State Bank of Idabel ("Idabel and other facts of record, the Board concludes that, Bank") Idabel, Oklahoma. Idabel Bank (deposits on balance, considerations relating to banking of $27.0 million) is the largest bank in the Mc- factors are consistent with approval of the subject Curtain banking market. Idabel Bank is located application. in the town of Idabel approximately 12 miles south Although consummation of the proposal would of Bank, and is separated from Bank by a natural effect no immediate changes in the banking servbarrier. Although Idabel Bank and Bank are both ices offered by Bank, considerations relating to located in the McCurtain banking market, the the convenience and needs of the community to Board notes that the principal of Applicant ac- be served are consistent with approval. It is the quired Idabel Bank at a time when that bank was Board's judgment that the proposed transaction experiencing some financial and managerial prob- would be in the public interest and that the applilems, and that his subsequent control of Idabel cation should be approved. Bank has been beneficial to that bank's overall On the basis of the record, the application is operations. Accordingly, based on the facts of this approved for the reasons summarized above. The case, particularly the fact that the transaction rep- transaction shall not be made (a) before the thirresents merely a reorganization of the existing tieth calendar day following the effective date of ownership of Bank, the Board concludes that con- this Order or (b) later than three months after the summation of the proposal would not have any effective date of this Order, unless such period adverse effect on other banks in the relevant mar- is extended for good cause by the Board or by ket, and that competitive considerations are con- the Federal Reserve Bank of Dallas pursuant to sistent with approval of the application. delegated authority. The future prospects of Applicant are entirely By order of the Board of Governors, effective dependent upon the financial resources of Bank. October 8, 1975. Applicant proposes to service the debt it would Voting for this action: Vice Chairman Mitchell and Governors Bucher, Holland, Cold well, and Jackson. Absent and not voting: Chairman Burns and Governor Wallich. 'All banking data are as of December 31, 1974. 2The McCurtain banking market is approximated by Mc- (Signed) GRIFFITH L. GARWOOD, Curtain County, Oklahoma. [SEAL] Assistant Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

810 Federal Reserve Bulletin • November 1975 CLEVETRUST CORPORATION, action would not have a significantly adverse effect CLEVELAND, OHIO on existing or potential competition in any relevant area. The financial and managerial resources and fu- Order Approving Acquisition of Bank ture prospects of Applicant, its subsidiaries, and CleveTrust Corporation, Cleveland, Ohio, a Bank are regarded as satisfactory and consistent bank holding company within the meaning of the with approval of the application. Affiliation with Bank Holding Company Act, has applied for the Applicant will enable Bank to expand a number Board's approval under § 3(a)(3) of the Act (12 of its services such as equipment leasing, trust U.S.C. 1842(a)(3)) to acquire 100 per cent of the services and international banking services. These voting shares (less directors' qualifying shares) of expanded services should provide some added the successor by merger to The Northeastern Ohio convenience to the residents of the area. There- National Bank, Ashtabula, Ohio. fore, convenience and needs considerations lend Notice of the application, affording opportunity weight toward approval of the application. It is for interested persons to submit comments and the Board's judgment that the proposed acquisition views, has been given in accordance with § 3(b) would be in the public interest and that the appliof the Act. The time for filing comments and views cation should be approved. has expired, and the Board has considered the On the basis of the record, the application is application and all comments received in light of approved for the reasons summarized above. The the factors set forth in § 3(c) of the Act (12 U.S.C. transaction shall not be made (a) before the thir- 1842(c)). tieth calendar day following the effective date of Applicant, the largest bank holding company in this Order or (b) later than three months after the Ohio, controls three banks with aggregate deposits effective date of this Order, unless such period of approximately $3 billion,1 representing 10 per is extended for good cause by the Board, or by cent of the total deposits in commercial banks in the Federal Reserve Bank of Cleveland pursuant the State.2 Acquisition of Bank would increase to delegated authority. Applicant's share of State deposits by two-tenths By order of the Board of Governors, effective of one per cent. Consummation of the proposal October 8, 1975. would not significantly affect State-wide concen- Voting for this action: Vice Chairman Mitchell and tration of banking resources in Ohio. Governors Bucher, Holland, Cold well, and Jackson. Bank is the second largest of four banking Absent and not voting: Chairman Burns and Governor organizations in the Ashtabula banking market3 Wallich. and controls approximately 36.7 per cent of total (Signed) GRIFFITH L. GARWOOD, market deposits. On the basis of the record, it [SEAL] Assistant Secretary to the Board. appears that some existing competition between Applicant's banking subsidiaries and Bank may be eliminated as a result of the proposal. However, the service areas of Applicant's subsidiaries and FIRST AMTENN CORPORATION, Bank do not appear to overlap, and the amount NASHVILLE, TENNESSEE of any such competition that would be eliminated Order Denying Acquisition of Bank as a result of the proposal does not appear to be significant. Furthmore, it appears unlikely that First Amtenn Corporation, Nashville, Tennes- Applicant would enter the market de novo, in view see, a bank holding company within the meaning of the fact that the market's population and depos- of the Bank Holding Company Act, has applied its per banking office ratios are below the respec- for the Board's approval under § 3(a)(3) of the tive State averages. Therefore, the Board con- Act (12 U.S.C. 1842(a)(3)) to acquire all of the cludes that consummation of the proposed trans- voting shares (less directors' qualifying shares) of The First National Bank of Sparta, Sparta, Tennessee ("Bank"). 1 Applicant has obtained Board approval to acquire but has Notice of the application, affording opportunity not yet acquired The City Bank, Kent, Ohio. 2All banking data are as of December 31, 1974, and reflect for interested persons to submit comments and bank holding company formations and acquisitions approved views, has been given in accordance with § 3(b) by the Board through September 9, 1975. of the Act. The time for filing comments and views 3The Ashtabula banking market is approximated by Ashtabula County. has expired, and the Board has considered the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 811 application and all comments received in light of would be a significant cash drain on Applicant. the factors set forth in § 3(c) of the Act (12 U.S.C. In the Board's view, the projected earnings of 1842(c)). Applicant do not provide Applicant with the nec- Applicant, the second largest banking organi- essary funds to meet this proposed increase in its zation in Tennessee, controls eight banks with annual debt servicing requirements while at the aggregate deposits of approximately $1.2 billion, same time maintaining and strengthening the capirepresenting 9.4 per cent of the total deposits in tal at its subsidiary banks. Under these circumcommercial banks in the State.1 Acquisition of stances, the Board believes that Applicant should Bank would increase Applicant's share of State concentrate its financial and managerial resources deposits by 0.26 per cent and would not signifi- toward strengthening its existing subsidiaries becantly increase the concentration of banking re- fore seeking further expansion of its banking insources in Tennessee. terests. Accordingly, the Board concludes that Bank holds deposits of approximately $32 mil- considerations relating to the financial and manalion, representing 66 per cent of the total deposits gerial resources and future prospects weigh against in commercial banks in the relevant market,2 and approval of the application. ranks as the larger of two banks operating in the With respect to convenience and needs considmarket. Applicant's subsidiary bank closest to erations, Applicant proposes to expand the serv- Bank is located 60 miles away in Tullahoma, ices presently offered by Bank. While these con- Tennessee. It does not appear that any meaningful siderations relating to the convenience and needs competition presently exists between Applicant's of the community to be served lend some weight banking subsidiaries and Bank. Furthermore, it toward approval of the application, they do not does not appear that any significant competition outweigh the adverse findings with respect to the would develop in the foreseeable future between financial factors involved in Applicant's proposal. Applicant and Bank in view of the distances in- Based upon the foregoing and other considvolved and Tennessee law, which prohibits Appli- erations reflected in the record, the Board concant from entering the relevant market de novo cludes that the financial considerations involved prior to 1980. Moreover, consummation of the in the proposal present adverse factors bearing on proposed transaction could have a salutory effect the financial condition and future prospects of on competition by permitting Bank's sole compet- Applicant and Bank. Such adverse factors are not itor in the market, a branch office of Commerce outweighed by any procompetitive effects or by Union Bank of Nashville, Nashville, Tennessee, the benefits which would result in serving the to reorganize itself into a bank with branching convenience and needs of the community. Acpowers. Therefore, the Board concludes that con- cordingly, it is the Board's judgment that approval summation of the proposal would not have any of the application would not be in the public significantly adverse effects on existing or potential interest and that the application should be, and competition in any relevant area, and that the hereby is, denied. competitive considerations are consistent with ap- By order of the Board of Governors, effective proval of the application. October 28, 1975. As indicated on previous occasions, the Board Voting for this action: Chairman Burns and Goverbelieves that a holding company should be a source nors Bucher, Holland, Coldwell, and Jackson. Absent of financial and managerial strength to its subsidiand not voting: Governors Mitchell and Wallich. ary bank(s), and that the Board will closely exam- (Signed) THEODORE E. ALLISON, ine the condition of the applicant in each case with this consideration in mind. The subject proposal [SEAL] Secretary of the Board. is not an exchange of shares but contemplates an acquisition debt of more than $6.6 million, in- THE INTERNATIONAL BROTHERHOOD OF BOILcluding an immediate cash outlay of almost $1 ERMAKERS, IRON SHIP BUILDERS, BLACKmillion. The funds required to service this debt SMITHS, FORGERS AND HELPERS, KANSAS CITY, KANSAS *A11 banking data are as of December 31, 1974, and reflect Order Approving bank holding company formations and acquisitions approved Acquisition of Bank Stock through September 30, 1975. 2The relevant market for purposes of analyzing the competitive effects of the subject proposal is approximated by all of The International Brotherhood of Boilermakers, White County, Tennessee. Iron Ship Builders, Blacksmiths, Forgers and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

812 Federal Reserve Bulletin • November 1975 Helpers, Kansas City, Kansas, a bank holding relationship which exists between many of Bank's company within the meaning of the Bank Holding stockholders and Applicant, a union of which they Company Act, has applied for the Board's ap- are members, the Board believes that the unique proval under § 3(a)(3) of the Act (12 U.S.C. facts present in this proposal are such that approv- 1842(a)(3)) for flexible authority to acquire, from ing Applicant's request would be consistent with time to time, additional voting shares of The the public interest. In this connection, it is noted Brotherhood State Bank, Kansas City, Kansas that no meaningful change in the control of Bank ("Bank"), so long as Applicant's interest does not would result from granting Applicant the authority exceed 40 per cent of Bank's outstanding voting to vary its proportionate interest in Bank within shares. the limits and under the circumstances described Notice of the application, affording opportunity herein. Moreover, consummation of the proposal for interested persons to submit comments and would not have any adverse effect on existing or views, has been given in accordance with § 3(b) potential competition, nor would it increase the of the Act. The time for filing comments and views concentration of banking resources or have an has expired and the Board has considered the adverse effect on other banks in the area. Accordapplication and all comments received in light of ingly, the Board concludes that competitive conthe factors set forth in § 3(c) of the Act (12 U.S.C. siderations are consistent with approval of the 1842(c)). application. Applicant; a fraternal labor organization, is a The financial and managerial resources and fuone-bank holding company that became subject to ture prospects of Applicant and Bank are regarded the Act by virtue of the 1970 Amendments thereto. as favorable and consistent with approval of the Applicant presently owns or controls 32.3 per cent application. Similarly, considerations relating to of the shares of Bank. With total deposits of $48 convenience and needs of the community to be million, Bank controls approximately 1.03 per served are consistent with approval of the applicacent of the total deposits in commercial banks in tion. It is the Board's judgment that approval of the Kansas City market1 and is the sixteenth largest the application would be consistent with the public bank in that market.2 interest and that the application should be ap- Applicant requests Board approval to acquire, proved. from time to time, up to an additional 7.7 per Accordingly, on the basis of the unique facts cent of the voting shares of Bank. Although Ap- in the present record, the application is approved plicant does not propose to acquire any additional for the reasons summarized above. No such acshares of Bank immediately, the purpose of filing quisition shall be made before the thirtieth calendar the instant application is to facilitate Applicant's day following the effective date of this Order. future acquisitions, on an intermittent basis, of Furthermore, the authority to purchase additional additional shares of Bank from shareholders hold- shares of Bank so long as Applicant's aggregate ing nominal amounts of Bank stock. In many cases holdings in Bank do not exceed 40 per cent of the shareholders from whom Applicant would the outstanding shares of Bank shall expire on purchase shares would be individuals associated December 31, 1976. Upon request by the Appliwith the fraternal organization. Specific examples cant, the Federal Reserve Bank of Kansas City of such stockholders cited by Applicant in the is hereby authorized, pursuant to delegated auapplication include retired persons desiring to thority from the Board, to extend the authority transfer their assets to a more income-producing granted herein for not more than one year at a type of asset; widows of deceased stockholders time, if in its judgment, the financial and managewho wish to secure immediate funds; and persons rial resources of Applicant and Bank are satisin financial distress. In view of Applicant's status factory and such extensions would not be detriunder the Bank Holding Company Act,3 and the mental to the public interest, but no such extensions granted by the Reserve Bank shall in the aggregate exceed five years. Any request by AplrThe Kansas City banking market is approximated by John- plicant for a one-year extension of the authority son and Wyandotte Counties in Kansas and northern Cass granted herein shall be submitted in writing to the County and Clay, Jackson and Platte Counties in Missouri. Reserve Bank no later than October 1 of the year 2All banking data are as of December 31, 1974. 3As a labor organization, Applicant is exempt from the preceding the expiration of such authority and shall prohibitions in section 4 of the Act, relating to the nonbanking include the number of shares of Bank that Appliinterests of a bank holding company, by virtue of section 4(c)(i) cant has sold or acquired since the date of this thereof. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 813 Order, the number of voting shares of Bank then to be located in the Grand Rapids banking market.2 outstanding, the number of shares of Bank then Applicant's lead bank, Old Kent Bank & Trust held by Applicant, and any other information that Company ("Old Kent Bank"), which is also lothe Reserve Bank may deem relevant in acting on cated in the Grand Rapids market, controls $764 such request. million in deposits, representing 49 per cent of By order of the Board of Governors, effective market deposits, and Applicant ranks thereby as October 29, 1975. the largest banking organization in the market.3 The second largest banking organization in the Voting for this action: Vice Chairman Mitchell and market, which ranks as the eleventh largest in the Governors Holland, Wallich, Coldwell, and Jackson. State, controls 22.8 per cent of market deposits, Absent and not voting: Chairman Burns and Governor Bucher. and the market's third largest banking organization, which ranks second in the State, controls (Signed) THEODORE E. ALLISON, 20.3 per cent of such deposits. In addition to the [SEAL] Secretary of the Board. market's three largest banking organizations, 13 other banking organizations, including the first, fifth, and tenth largest banking organizations in OLD KENT FINANCIAL CORPORATION, the State, are also represented in the market. GRAND RAPIDS, MICHIGAN Although Applicant is the largest banking organization in the market, it does not appear that con- Order Approving Acquisition of Banks summation of the subject proposal would significantly alter the structure of banking in the market. Old Kent Financial Corporation, Grand Rapids, Michigan ("Applicant"), a bank holding company As indicated above, both Grandville Bank and within the meaning of the Bank Holding Company Wyoming Bank will be located in the Grand Act, has applied for the Board's approval under Rapids banking market. The city of Grandville, § 3(a)(3) of the Act (12 U.S.C. 1842(a)(3)) to with a population of 12,000, is located about six acquire 100 per cent of the voting shares of both miles southwest of Grand Rapids, and the Grand- Old Kent Bank of Grandville, Grandville, Michi- ville Bank will primarily serve the southern portion gan ("Grandville Bank"), and Old Kent Bank of of that city as well as the southwestern portion Wyoming, Wyoming, Michigan ("Wyoming of the city of Wyoming. Applicant's lead bank Bank"), both proposed new banks. operates one branch office in Grandville, and the Notice of the applications, affording opportunity only other banking office in the city proper, which for interested persons to submit comments and is also the only organization legally capable of views, has been given in accordance with § 3(b) branching in Grandville, is the main office of a of the Act. The time for filing comments and views subsidiary bank of the State's largest banking has expired, and the Board has considered the organization. It is noted that no new banking office applications and all comments received in light of has been established in Grandville within the past the factors set forth in § 3(c) of the Act (12 U.S.C. few years although the population grew some 35 1842(c)). per cent during the period 1960-1970, which is Applicant, the seventh largest banking organi- more than three times the population growth exzation in Michigan, controls four banks with ag- perienced by the overall Grand Rapids market as gregate deposits of approximately $851 million, well as the State as a whole. Based on the past representing about 3 per cent of the total commer- and projected population growth of Grandville, it cial bank deposits in the State.1 Since the applica- appears that the area should be able to support tions involve the establishment of de novo banks, an additional banking office without having undue no existing competition between any of Appli- adverse effects on any competing banks. cant's present subsidiaries and Grandville Bank or The city of Wyoming, with a population of Wyoming Bank would be eliminated by the pro- 62,000, is located just south of Grand Rapids, and posals, nor would concentration be increased in Wyoming Bank will primarily serve the southany relevant area. central portion of Wyoming. In addition to a Both Grandville Bank and Wyoming Bank are branch office of Applicant's lead bank, Wyoming 'All banking data, unless otherwise indicated, are as of 2The Grand Rapids banking market is approximated by the December 31, 1974, and reflect bank holding company forma- Grand Rapids RMA. tions and acquisitions approved through July 31, 1975. 3 All market data are as of June 30, 1974. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

814 Federal Reserve Bulletin • November 1975 also contains four branch offices of the market's ville and Wyoming. Some of the services to be second largest banking organization and four of- offered by each of the proposed banks include fices of a subsidiary bank of the third largest special checking, longer banking hours, reduced banking organization in the market, the latter being loan rates, and lower minimum deposits on 90-day the only bank that may presently open additional certificates of deposits. In the Board's view, these branches in Wyoming under Michigan law. The considerations relating to convenience and needs Wyoming area has also experienced significant of the communities to be served are consistent with population growth in the past, as evidenced by approval of each of the applications and, morea population growth of about 23 per cent during over, outweigh any slightly adverse effects that the period from 1960-1970 (which is approxi- might result therefrom. It is the Board's judgment mately twice that for the Grand Rapids market and that the proposed acquisitions would be in the for the State), and the prospects for continued public interest and that the applications should be growth in the area appear favorable. In view of approved. the increasing demand for banking services result- On the basis of the record, the applications are ing from such growth, it appears that the estab- approved for the reasons summarized above. The lishment of a bank by Applicant in Wyoming transactions shall not be made (a) before the thirwould not have any undue adverse effect on any tieth calendar day following the effective date of competing banks. this Order or (b) later than three months after that The Board has previously expressed some con- date, and (c) Old Kent Bank of Grandville, cern about the competitive effects of expansion Grandville, Michigan, and Old Kent Bank of within a market by a market's largest banking Wyoming, Wyoming, Michigan, shall be opened organization, even where such expansion was for business not later than six months after the through the establishment of a new bank. How- effective date of this Order. Each of the periods ever, with respect to each of the proposals under described in (b) and (c) may be extended for good consideration, it appears that Applicant is not cause by the Board, or by the Federal Reserve seeking to preempt a banking site before there is Bank of Chicago pursuant to delegated authority. a need for a bank. Moreover, consummation of By order of the Board of Governors, effective neither of the proposals should raise significant October 2, 1975. barriers to entry from organizations without the Voting for this action: Vice Chairman Mitchell and Grand Rapids market. The Grand Rapids market Governors Bucher, Wallich, and Jackson. Voting in general, and the communities of Grandville and against this action: Governors Holland and Coldwell. Wyoming in particular, should remain attractive Absent and not voting: Chairman Burns. for de novo entry by others. Accordingly, having (Signed) THEODORE E. ALLISON, considered all the facts of record in connection [SEAL] Secretary of the Board. with each of Applicant's proposals, the Board concludes that the overall effects on competition will be no more than slightly adverse. The financial condition, managerial resources Dissenting Statement and prospects of Applicant and its subsidiary banks of Governors Holland and Coldwell are satisfactory. Grandville Bank and Wyoming Bank, as proposed new banks, have no operating We dissent from the Board's action approving history, but projected earnings and growth for each the establishment of two de novo banks in the of the new banks appear favorable. Thus, banking Grand Rapids market by Old Kent Financial Corfactors are consistent with approval of the appli- poration, the largest banking organization in that cations. market. We believe that the Board's action of this As indicated above, both Grandville and date will further accentuate the concentration of Wyoming have experienced significant population banking resources within this banking market and, growth, with an accompanying increased demand in the long run, will result in a less competitive for additional banking services. In addition to banking environment. providing an additional banking office to each of Courts have long recognized that de novo activtheir respective communities, Grandville Bank and ity by the dominant organization in a market may Wyoming Bank will each offer a full range of be a means whereby competitors are "excluded" banking services, some of which are not presently from that market. In United States v. Alcoa, 148 available from the banking offices now in Grand- F.2d 416, at 431 (2d Cir. 1945), the Court stated: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 815 Nothing compelled it [Alcoa] to keep doubling and redoubling not. Applicant already serves the communities of its capacity before others entered the field. It insists that it Grandville and Wyoming. Applicant operates a never excluded competitors; but we can think of no more effective exclusion than progressively to embrace each new branch in the city of Grandville less than two miles opportunity as it opened, and to face every newcomer with north of the site of Grandville Bank and two other new capacity already geared into a great organization, having branches within 2.5 miles of the site of the the advantage of experience, trade connections and the elite of personnel. Grandville Bank. In regard to Wyoming Bank, In terms of competition in the banking industry, Applicant already operates a branch in the city of the Board has similarly recognized the adverse Wyoming and six branches outside Wyoming but competitive consequences that may result from de within 1.5 miles of the city. In each instance, novo expansion if carried too far by a market's Applicant is able to serve the communities of dominant organization. Some of the obvious ad- Grandville and Wyoming from its existing verse consequences resulting from such expansion branches, as evidenced by the sizable deposits include solidifying the organization's dominant Applicant derives from each of the communities. position in the market and reducing the likelihood Therefore, we fail to perceive how the establishthat the market would become less concentrated ment of two new banks by Applicant will benefit and thus more competitive. the convenience and needs of the communities to Turning to the specific facts in this case, we be served to any important extent. Accordingly, note that Applicant controls 49 per cent of the we find that convenience and needs considerations market's deposits, more than the combined shares do not outweigh the adverse competitive effects of the second and third largest banking organi- flowing from Applicant's proposals. zations in the market, and the market's three On the basis of the record, it is our judgment largest banking organizations control 92.1 per cent that the proposed acquisitions would not be in the of the deposits. In view of the existing structure public interest and that the applications should be of banking in the Grand Rapids market, we believe denied. that any action by the market's dominant organization that would have the effect of lessening the THIRD NATIONAL CORPORATION, possibility of a deconcentration of the banking NASHVILLE, TENNESSEE resources within the market should be resisted unless other public benefits of such action are Order Denying overwhelming. Application for Acquisition of Bank The areas to be served by Grandville Bank and Third National Corporation, Nashville, Tennes- Wyoming Bank have experienced significant popsee, a bank holding company within the meaning ulation growth and have good prospects for conof the Bank Holding Company Act, has applied tinued growth. We believe attractive locations in for the Board's approval under § 3(a)(3) of the such areas should be preserved for entry or expan- Act (12 U.S.C. § 1842(a)(3)) to acquire 50 per sion by new or existing competitors rather than cent or more of the voting shares of Bank of being used for additional sites in those localities Huntingdon, Huntingdon, Tennessee ("Bank"). by the market's already dominant banking organi- Notice of the application, affording opportunity zation. It appears to us that the Board's action for interested persons to submit comments and will have a discouraging effect upon other wouldviews, has been given in accordance with § 3(b) be competitors, since organizations that might of the Act. The time for filing comments and views otherwise have been attracted to enter either has expired, and the Board has considered the Grandville or Wyoming will now have to reconapplication and all comments received in light of sider whether they want to confront the prolifthe factors set forth in § 3(c) of the Act (12 U.S.C. erating presence of the market's dominant banking § 1842(c)). organization in those cities. Consequently, we Applicant, the third largest banking organization think the possibility that the market would become in Tennessee, controls eight banks with aggregate less concentrated will be significantly diminished. deposits of approximately $1.1 billion, repre- In view of our conclusion with respect to the senting approximately 8.8 per cent of the total adverse competitive effects of Applicant's propos- deposits in commercial banks in the State.1 Acals, the Bank Holding Company Act requires us to consider whether such adverse effects are clearly outweighed by other public interest considerations *AI1 banking data are as of December 31, 1974, and reflect holding company formations and acquisitions approved through reflected in the record. We think they clearly are July 31, 1975. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

816 Federal Reserve Bulletin • November 1975 quisition of Bank would increase Applicant's share should concentrate its financial and managerial of State deposits only slightly and would not alter resources to strengthen its present subsidiaries Applicant's ranking among the other banking or- before seeking further expansion. Accordingly, on ganizations in the State. Accordingly, consumma- the basis of the record, the Board concludes that tion of the proposal would not significantly increase the considerations relating to the financial and the concentration of banking resources in Tennes- managerial resources and future prospects of Apsee. plicant weigh against approval of the application. Bank holds deposits of approximately $32 mil- Applicant has proposed to provide Bank with lion representing approximately 49 per cent of the accounting and data processing services and to total deposits in commercial banks in the relevant assist in meeting present and future management banking market and is the largest of six commer- requirements. The Board does not consider these cial banks operating therein.2 Applicant's banking convenience and needs considerations sufficient to subsidiary closest to Bank is located 52 miles away outweigh adverse financial considerations. Acin Savannah. It appears that no meaningful com- cordingly, it is the Board's judgment that approval petition presently exists between any of Appli- of the application would not be in the public cant's subsidiary banks and Bank, nor is any interest and that the application should be denied. competition likely to develop in view of the dis- During the course of processing the instant tances involved. The relevant market is a sparsely application, it came to the Board's attention that populated, rural area, the per capita income of officials of Applicant and of its major subsidiary which is substantially below the per capita income bank had indirect ownership interests in Bank, that of the State of Tennessee; the market's population because Applicant intended to pay a significant and deposit ratios per banking office are also premium on shares of Bank, these individuals substantially below the State average. The market stood to gain a substantial profit as a result of does not appear attractive for de novo entry and Applicant's proposed acquisition of shares of accordingly, but for this application, Applicant is Bank, and that these facts had not been previously not deemed a likely entrant into the market. The disclosed to the public. Accordingly, the Board Board concludes that consummation of the pro- referred the matter to the Securities and Exchange posed transaction would not have any significant Commission for consideration whether Applicant, adverse effects on existing or potential competition or any of the individuals involved, had violated in any relevant area and that the competitive con- the Securities Act of 1933 or the Securities Exsiderations are consistent with approval of the change Act of 1934. The Board deferred determiapplication. nation of the instant application pending such The Board has repeatedly indicated that a hold- consideration by the Commission. Without admiting company should provide a source of strength ting or denying any of the Commission's findings, for its subsidiary banks and that the Board exam- Applicant subsequently consented to the entry of ines closely the condition of an applicant in each an order by the Commission requiring certain case with this in mind. With respect to the present public disclosures relating to the matter referred proposal, Bank would be acquired through a cash by the Board. Because the Board is denying this purchase of Bank's stock. Principal and interest application on financial grounds it has not made payments on the debt incurred by consummation independent findings of fact on the matters referred of this proposal would represent a significant cash to the Commission, nor has it taken those matters drain on Applicant and an increase in its already into account in any way in reaching its decision leveraged position. Projected earnings of Appli- in this case.3 However, without intending to reflect cant, in the Board's view, do not provide Appli- in any way on the substance of the matters concant with the necessary financial flexibility to meet sidered by the Commission in this case, the Board this proposed substantial increase in its annual debt believes it would be appropriate to make clear for servicing requirements as well as any unexpected the future its position with respect to the involveproblems that may arise at any of its subsidiary ment of bank holding company "insiders" in banks. In addition, Applicant, through its mort- acquisitions by their companies. gage lending subsidiary, is currently experiencing financial pressures. The Board feels that Applicant :?The Board recognizes that Applicant's consent to the entry of the Commission's order did not constitute an admission of the relevant facts, and that were such matters to be litigated 2The relevant banking market is approximated by Carroll Applicant might put forward defenses and mitigating circum- County. stances. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 817 Arrangements in which bank holding company § 1842(a)(1)) to become a bank holding company directors, officers or employees, or their close through acquisition of 98.2 per cent of the voting relatives, have a personal financial interest in an shares of The Harlan National Bank, Harlan, Iowa acquisition proposed by the holding company will ("Bank"). The factors that are considered in actbe closely scrutinized by the Board to ensure both ing on the application are set forth in § 3(c) of that they do not involve an effort by the company the Act (12 U.S.C. § 1842(c)). to circumvent the requirement that prior approval Applicant has also applied, pursuant to § 4(c)(8) of the Board be obtained for such an acquisition, of the Bank Holding Company Act (12 U.S.C. and that they do not present the threat of any § 1843(c)(8)) and § 225.4(b)(2) of the Board's adverse effects upon the financial strength and Regulation Y (12 CFR § 225.4(b)(2)), for permissoundness of the holding company or any of its sion to acquire voting shares of Bank Insurance subsidiaries. Further, to the extent a subsidiary Agency, Harlan, Iowa ("Agency"). Applicant bank of a holding company advances funds to such would engage thereafter in the activities of acting persons, or to third parties, for the purpose of as agent or broker in the sale of insurance, includpurchasing or holding stock where the ultimate ing credit life, credit accident and health insurpurpose is to enable its parent to become the owner ance, and casualty insurance which is directly of the stock, an inappropriate use of bank funds related to an extension of credit or other financial may occur. The impropriety of such transactions services by Bank and Applicant or is otherwise may have more serious effects where the loans are sold as a matter of convenience to the purchaser at preferential rates, or where the ultimate pur- pursuant to § 225.4(a)(9)(ii) of Regulation Y. Such chase by the holding company involves the pay- activities have been determined by the Board in ment of substantial premiums to the insiders. Such § 225.4(a)(9)(ii) of Regulation Y as permissible arrangements do not comport with sound banking for bank holding companies, subject to Board practice and are inconsistent with the need to approval of individual proposals in accordance sustain public confidence in the integrity of the with the procedures of § 225.4(b). banking system. The financial and managerial resources and The Board expects holding companies and their prospects of Bank appear generally satisfactory subsidiaries to avoid the conflicts of interest inher- and consistent with approval of the application. ent in such self-dealing arrangements, and, in its Notice of the applications, affording opportunity consideration of applications before it, depending for interested persons to submit comments and on the facts, it may deem the existence of such views on the public interest factors, has been duly arrangements to reflect adversely upon the mana- published (40 Federal Register 23934). The time gerial resources of an applicant. for filing comments and views has expired, and By order of the Board of Governors, effective the Board has considered the applications and all October 3, 1975. comments received in light of the factors set forth in §§ 3(c) and 4(c)(8). Voting for this action: Vice Chairman Mitchell and Applicant is a nonoperating corporation organ- Governors Bucher, Wallich, Coldwell, and Jackson. Absent and not voting: Chairman Burns and Governor ized for the purpose of becoming a bank holding Holland. company through acquisition of Bank and of acquiring the insurance agency business of the (Signed) THEODORE E. ALLISON, principal shareholders of Bank. Bank, with de- [SEAL] Secretary of the Board. posits of approximately $22 million, representing .2 of 1 per cent of the total commercial bank ORDER UNDER SECTIONS 3 AND 4 deposits in Iowa, is the largest of seven commer- OF BANK HOLDING COMPANY ACT cial banks operating in the Shelby County banking market.1 Bank holds approximately 30 per cent HARLAN NATIONAL COMPANY, of the total commercial bank deposits in this mar- HARLAN, IOWA ket. Inasmuch as the proposal represents merely a restructuring of Bank's ownership, the acquisi- Order Denying tion of Bank by Applicant would have no adverse Formation of Bank Holding Company effects on competition within the banking market. Harlan National Company, Harlan, Iowa, has applied for the Board's approval under § 3(a)(1) of the Bank Holding Company Act (12 U.S.C. 'All banking data are as of December 31, 1974. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

818 Federal Reserve Bulletin • November 1975 Accordingly, the Board concludes that competitive and instalment loans and to host local seminars considerations are consistent with approval of the for area farmers. These considerations relating to application. convenience and needs of the community to be In regard to such considerations as they relate to served may be attained irrespective of Board ap- Applicant, the Board is of the opinion that other proval of the application and, in any event, they commitments by present ownership of Applicant do not, in the Board's view, outweigh the adverse would adversely affect the servicing of the pro- findings with respect to the financial factors inposed acquisition debt. The owner of Applicant volved in Applicant's proposal. and Bank, Mr. Fred R. Home, Jr., is also the On the basis of all of the circumstances of this sole owner of another one-bank holding company, case and the facts of record, the Board concludes the formation of which was approved by the Board that the acquisition debt involved in this proposal in 1973.2 Both the proposed formation and the presents adverse circumstances bearing on the fi- 1973 formation involve a considerable amount of nancial condition and prospects of Applicant and acquisition debt, and it does not appear that Mr. Bank. Such adverse factors are not outweighed by Home would be financially able, either personally any procompetitive effects or by benefits to the or through the bank holding companies, to service convenience and needs of the communities to be both debts associated with both bank holding served. Accordingly, it is the Board's judgment company formations without adversely affecting that approval of the application to become a bank the resources of the subsidiary banks. Further- holding company would not be in the public intermore, even if Applicant's projections for the pro- est and the application should be denied.3 posed acquisition are realized, the projected earn- On the basis of the record, the application is ings of Bank and Agency would not, in the denied for the reasons summarized above. Board's view, provide Applicant with the neces- By order of the Board of Governors, effective sary financial flexibility to meet its annual debt October 31, 1975. service requirements as well as any unforeseen financial problems that might arise at Bank. Ac- Voting for this action: Vice Chairman Mitchell and cordingly, on the basis of the facts of record, the Governors Holland, Wallich, Coldwell, and Jackson. Absent and not voting: Chairman Burns and Governor Board concludes that considerations relating to the Bucher. financial aspects of Applicant's proposal lend weight toward denial of the application. With respect to convenience and needs consid- (Signed) THEODORE E. ALLISON, erations, Applicant proposes to increase business [SEAL] Secretary of the Board. Mn view of the Board's action with respect to the application 2First National Company of Missouri Valley, Missouri Val- to become a bank holding company, consideration of the ley, Iowa (38 Federal Register 5512, March 1, 1973). application to acquire the insurance agency becomes moot. and served as the functional equivalent to an NOTICE OF extension of credit. In June 1974, the National PROPOSED RULEMAKING— Automobile Dealers Association ("NADA") sought judicial review of this leasing regulation The following proposal was issued by the Board insofar as it permitted bank holding companies to of Governors of the Federal Reserve System to engage in automobile leasing. NAD A objected, in consider whether automobile leasing should conparticular, to the provision in the regulation altinue to be a permissible activity for bank holding lowing lessors to deduct 20 per cent of the acquicompanies: sition cost of the leased property as residual value In March 1974, the Board issued an amendment that need not be recovered by rentals or tax beneto its Regulation Y, 12 CFR 225.4(a)(6)(a), to fits in computing a full payout lease (12 CFR permit bank holding companies to engage in cer- 225.4(a)(6)(a)(iv)(3)) and the provision permitting tain leasing activities with respect to personal a lessor to deduct up to 60 per cent of the acquisiproperty where the lease was on a full payout basis tion cost of the leased property when such amount Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 819 was guaranteed by a financially qualified lessee, property leasing regulation (12 CFR 225.4(a)(6) manufacturer or third party (12 CFR 225.4(a) (a)) and, if it should be, under what conditions (6)(a)(iv)(4)). In addition, NADA argued that the and limitations. activity of automobile leasing is not closely related Interested persons are invited to submit relevant to banking in that it is merchandising and dealing data, views, or arguments on this matter. Upon in used cars and does not serve as the "functional request, interested parties will be afforded an opequivalent of an extension of credit" as required portunity for an oral presentation of their views. by the Board's regulation (12 CFR 225.4(a)(6)(a) Any such material and requests should be submit- 0)). ted in writing to the Secretary, Board of Governors After briefing and oral argument of the case of the Federal Reserve System, Washington, D.C. before the U.S. Court of Appeals for the D.C. 20551, to be received not later than December 22, Circuit, the Board sought and the Court granted 1975. Such material will be made available for a remand of the matter so that the Board might inspection and copying upon request, except as consider these issues raised by NADA and such provided in section 261.6(a) of the Board's Rules other issues as are relevant to bank holding com- Regarding Availability of Information. panies engaging in automobile leasing. Accordingly, the Board proposes to determine whether automobile leasing ought to continue to be in- (Signed) THEODORE E. ALLISON, cluded within the scope of the Board's personal [SEAL] Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

820 Federal Reserve Bulletin • November 1975 O R D E RS A P P R O V ED U N D ER T HE B A NK H O L D I NG C O M P A NY A C T- BY THE BOARD OF GOVERNORS During October 1975, the Board of Governors approved the applications listed below. The orders have been published in the Federal Register, and copies are available upon request to Publications Services, Division of Administrative Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. SECTION 3 Board action Federal (effective Register Applicant Bank(s) date) citation Alabama Bancorporation, Gadsden Mall Bank, 10/15/75 40 F.R. 49409 Birmingham, Alabama Gadsden, Alabama 10/22/75 First National Charter Excelsior Trust Company 10/6/75 40 F.R. 48177 Corporation, Kansas of Excelsior Springs, 10/14/75 City, Missouri Missouri, Excelsior Springs, Missouri Stockton Bancorp, Inc., The First National Bank 10/29/75 40 F.R. 52667 Stockton, Illinois of Stockton, Stockton, 11/11/75 Illinois ORDER APPROVED UNDER BANK MERGER ACT Board action Federal (effective Register Applicant Bank(s) date) citation Chemical Bank, New York, Chemical Bank of Suffolk, 10/8/75 40 F.R. 49152 New York National Association, Smithtown, 10/21/75 New York BY FEDERAL RESERVE BANKS During October 1975, applications were approved by the Federal Reserve Banks under delegated authority as listed below. The orders have been published in the Federal Register, and copies are available upon request to the Reserve Bank. SECTION 3 Federal Reserve Effective Register Applicant Bank(s) Bank date citation First Financial Corporation, The First American Atlanta 10/21/75 40 F.R. 51242 Tampa, Florida Bank of Pensacola, 11/4/75 Pensacola, Florida Bancorporation of Montana, The First State Bank Minneapolis 10/16/75 40 F.R. 51240 Great Falls, Montana of Thompson Falls, 1114/15 Thompson Falls, Montana Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 821 PENDING CASES INVOLVING THE BOARD OF GOVERNORS* Peter E. Blum v. Morgan Guaranty Trust Co., et al., filed October 1975, U.S.D.C. for the Northern District of Georgia. A.R. Martin-Trigona v. Board of Governors, et al., filed September 1975, U.S.D.C. for the Northern District of Illinois. A.R. Martin-Trigona v. Board of Governors, et al., filed September 1975, U.S.D.C. for the Northern District of Illinois. Reserve Enterprises, Inc. v. Arthur F. Burns, et al., filed September 1975, U.S.D.C. for the District of Minnesota. Logan v. Secretary of State, et al., filed September 1975, U.S.D.C. for the District of Columbia. Ellsworth v. Burns, filed September 1975, U.S.D.C. for the District of Arizona. Florida Association of Insurance Agents, Inc. v Board of Governors and National Association of Insurance Agents, Inc. v. Board of Governors, filed August 1975, actions consolidated inU.S.C.A. for the Fifth Circuit. HenryM. Smithw. National State Bank of Boulder, etal, filed June 1975, U.S.D.C. for the Northern District of Texas. Bank of Boulder v. Board of Governors, et al., filed June 1975, U.S.C.A. for the Tenth Circuit, tDavid R. Merrill, et al. v. Federal Open Market Committee of the Federal Reserve System, filed May 1975, U.S.D.C. for the District of Columbia. Curvin J. Trone v. United States, filed April 1975, U.S. Court of Claims. Richard S. Kaye v. Arthur F. Burns, et al., filed April 1975, U.S.D.C. for the Southern District of New York. Louis I. Roussel v. Board of Governors, filed April 1975, U.S.D.C. for the Eastern District of Louisiana. **Cook, et al. v. Board of Governors, filed March 1975, U.S.D.C. for the District of Columbia. Purolator Courier Corporation v. Board of Governors, filed December 1974, U.S.C.A. for the District of Columbia Circuit. **Tri-State Bancorporation, Inc. v. Board of Governors, filed November 1974, U.S.C.A. for the Seventh Circuit. Georgia Association of Insurance Agents, et al. v. Board of Governors, filed October 1974, U.S.C.A. for the Fifth Circuit. Alabama Association of Insurance Agents, et al. v. Board of Governors, filed July'1974, U.S.C.A. for the Fifth Circuit. **Investment Company Institute v. Board of Governors, dismissed July 1975, U.S.D.C. for the District of Columbia; appeal pending, U.S.C.A. for the District of Columbia Circuit. George Brice, Jr., et al. v. Board of Governors, filed April 1974, U.S.C.A. for the Ninth Circuit. **National Automobile Dealers Association, Inc. v. Board of Governors, filed April 1974, U.S.C.A. for the District of Columbia Circuit. East Lansing State Bank v. Board of Governors, filed December 1973, U.S.C.A. for the Sixth Circuit. **Independent Bankers Association of America, Inc. v. Board of Governors and National Courier Association, et al. v. Board of Governors, filed December 1973, U.S.C.A. for the District of Columbia Circuit. **Jowa Independent Bankers v. Board of Governors, filed September 1973, U.S.C.A. for the District of Columbia Circuit, petition for certiorari filed. **Consumers Union of the United States, Inc., et al. v. Board of Governors, filed September 1973, U.S.D.C. for the District of Columbia. Bankers Trust New York Corporation v. Board of Governors, filed May 1973, U.S.C.A. for the Second Circuit. *This list of pending cases does not include suits against **Decisions have been handed down in these cases, subject Federal Reserve Banks in which the Board of Governors is to appeals noted. not named as a party. tThe Board of Governors is not named as a party in this action. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

823 Announcements ASSETS AND LIABILITIES OF The tabulations show as separate items the OVERSEAS BRANCHES amounts due from and due to other overseas branches of the same bank. Omitting these off- OF MEMBER BANKS shore interoffice claims, assets of the branches Total assets of the overseas branches of member increased by $18.6 billion, or 17 per cent, during banks increased by $22.5 billion, or 19 per cent, 1974. The respective figures for 1973 were $36.7 during 1974 to a total of $141 billion, according billion and 51 per cent. An important factor modto a Federal Reserve announcement that released erating the growth in branch assets was the shift data showing balance sheet items of overseas of foreign lending to U.S. head offices following branches at the beginning and end of the year. the termination of the voluntary foreign credit At the end of 1974, 732 branches were in operation restraint program at the end of January 1974. Forty in foreign countries and overseas territories, an per cent of the 1974 increase was accounted for increase of 38 branches during the year. by branches in Europe (particularly those in Lon- Assets and liabilities of overseas branches of member banks, end of year, 1973 and 1974 In millions of dollars, unless otherwise indicated United Bahama Near U.S. Kingdom Continental and Latin Far East overseas Item and Europe Cayman America East and areas and Total Ireland Islands Africa i trust territories 1973 1974 1973 1974 1973 1974 1973 1974 1973 1974 1973 1974 1973 1974 1973 1974 Assets Cash 31,411 31,333 9,521 10,983 6,593 6,081 609 729 1,647 2,673 129 157 317 114 50,227 52,070 Loans 19,084 21,277 6,776 8,465 12,493 14,802 3,055 4,107 . 6,763 10,040 331 598 1,608 2,134 50,110 61,423 Due from head offices and U.S. branches .. 499 2,007 128 129 737 650 28 33 346 444 40 229 312 138 2,090 3,630 Due from other overseas branches of own banks 5,462 8,118 2,075 3,153 287 275 675 474 636 850 100 146 10 144 9,245 13,160 Other 2,034 2,495 1,397 1,655 640 1,263 503 640 1,700 4,029 23 52 80 119 6,377 10,253 Total 58,490 65,230 19,897 24,385 20,750 23,071 4,870 5,983 11,092 18,036 623 1,182 2,327 2,649 118,049 140,536 Liabilities Deposits: Demand 2,480 3,703 1,768 1,862 139 140 1,407 1,533 1,257 1,710 253 402 562 631 7,866 9,981 Time 53,767 58,608 14,536 18,617 15,977 16,119 1,887 1,590 4,736 6,472 305 434 1,140 1,394 92,348 103,234 Due to head offices and U.S. branches .. 85 283 407 676 294 1,831 180 328 106 290 7 14 512 560 1,591 3,982 Due from other overseas branches of own banks 609 419 1,432 1,316 3,907 4,343 1,004 1,991 2,106 4,420 40 264 67 5 9,165 12,758 Other 1,549 2,217 1,754 1,914 433 638 392 541 2,887 5,144 18 68 46 59 7,079 10,581 Total 58,490 65,230 19,897 24,385 20,750 23,071 4,870 5,983 11,092 18,036 623 1,182 2,327 2,649 118,049 140,536 Number of branches... 56 58 100 108 120 123 236 241 110 125 17 22 55 55 694 732 NOTE.—Data are from Board of Governors of the Federal Reserve System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

824 Federal Reserve Bulletin • November 1975 don) and 36 per cent by branches in the Far East application form to all potential registrants, the whose assets grew by 64 per cent during the year. Board announced that it will make effective, as The rapid growth rate of branches in the Bahamas of December 1, 1975, properly completed regisand the Cayman Islands in recent years moderated trations received by November 17, 1975. significantly during 1974 to 11 per cent compared with 78 per cent during 1973. REVISION OF REGULATION F Loans at overseas branches expanded by $11.3 billion, or 23 per cent, during 1974. Cash assets The Board of Governors on October 23, 1975, increased by less than 4 per cent, reflecting a announced revision of its Regulation F (Securities stabilization of time placements with other banks of Member State Banks) to conform with rules in Euro-currency markets. issued by the Securities and Exchange Commis- The data are derived from reports of condition sion. filed at the end of the year with the Comptroller The revision is required by the Depository Inof the Currency and the Federal Reserve System, stitutions Act of 1974, which made it mandatory and differ in certain respects from other statistical for the Board to make the provisions of its Regureports covering aspects of overseas branch opera- lation F substantially similar to comparable rules tions. The assets and liabilities shown are payable issued by the SEC. in U.S. dollars as well as currencies of the coun- Under Regulation F, State member banks with tries where the branches are located and in other 500 or more stockholders are required to register foreign currencies. and to file periodic reports with the Board and comply with the regulation's requirements in AMENDMENT TO REGULATION H connection with the solicitation of proxies from shareholders. In addition, officers, directors, and The Board of Governors of the Federal Reserve principal stockholders of such banks are required System on October 22, 1975, announced adoption to file reports as to their stock ownership in the of an amendment to its Regulation H providing bank. No tender offer may be made for the stock for registration of State member banks that act as of such a bank unless certain information is contransfer agents. currently filed with the Board. All reports filed The action was taken pursuant to the Securities under Regulation F are publicly available. The Acts Amendments of 1975. Other bank regulators regulation applies to 60 State member banks. and the Securities and Exchange Commission are Major new provisions of the regulation require issuing similar rules for institutions under their State member banks with 500 or more stockholders jurisdiction. Proposed rules were issued for com- to: ment by the Board August 28. 1. Include bank stock market data in annual The new legislation is designed to foster a reports. national system for prompt and accurate clearance 2. Furnish to a stockholder or investor, upon and settlement of securities transactions. The new request, a copy of the annual report filed with the law requires that after December 1, 1975, banks Board. may not act as transfer agents unless they are 3. Disclose additional financial data in the anregistered with their Federal supervisory agency nual report to stockholders. in accordance with regulations issued under the 4. Utilize revised stockholder proposal proce- Act, such as the rule published on October 22 by dures. the Federal Reserve for State member banks. The 5. Follow certain additional requirements with SEC has general rulemaking and policy oversight respect to tender offers for registered bank stock. under the new legislation, but banks acting as 6. Use expanded and revised forms and intransfer agents are regulated primarily by their structions in making "insider" ownership reports. Federal bank supervisor. The revision of Regulation F to conform to SEC Under the statute, an application for registration rules as required by law was proposed February of all transfer agents becomes effective 30 days 25, and time for comment expired June 6, 1975. after receipt by the appropriate regulatory agency In these proposals the Board invited comment on or within such shorter time as the agency may the question of whether the regulation shall redetermine. In view of the short time remaining quire certification by independent public accountto the December 1 statutory deadline for regis- ants of bank financial statements. This was not tration and the time required for circulating the included in the revision but remains under study Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 825 by the Board. This revision of Regulation F is Senate has voted to repeal that section of the Act distinct from a recent proposal to amend required under which Regulation Z was amended and that periodic reports of bank condition and income the question is now under consideration in the announced October 1, 1975, and is not connected House of Representatives. with a recent SEC proposal concerning disclosure Section 409 of the Truth in Lending Act, enby bank holding companies. acted October 28, 1974, and the related amend- The Comptroller of the Currency and the Fed- ment of Regulation Z, apply to credit transactions eral Deposit Insurance Corporation have issued where the lender retains or acquires an interest in similar regulatory revisions for banks under their the real property involved as collateral, except for supervision. mortgages covered by RESPA (which is also under reconsideration in the Congress). AMENDMENT TO REGULATION Z The Board made public on September 16, 1975, a proposed amendment to Regulation Z to imple- The Board of Governors of the Federal Reserve ment the new statute. This was adopted without System has announced amendment of its Regula- substantive change except for the extension of the tion Z—Truth in Lending—to comply with a pro- transition period to January 31, 1976. vision of law requiring disclosure of closing costs in certain real property transactions not covered AMENDMENT TO REGULATION T by the Real Estate Settlement Procedures Act (RESPA). The Board of Governors announced on November The new law became effective October 28, 13, 1975, that it had amended its Regulation 1975. While the implementing regulatory amend- T—credit extended or arranged by brokers and ment also became effective October 28, 1975, dealers for securities transactions—to assist in the the Board has provided a transition period to private placement of securities. January 31, 1976, when major operating provi- The amendment adopted was substantially the sions of the amendment will go into effect. The same as that proposed for public comment last transition period takes account of the fact that the May 27. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

827 Industrial Production Released for publication November 14 month. Production of textiles, paper, and chemical materials continued to increase at a rapid pace, Industrial production increased by an estimated 0.4 although slower than in the previous few months. per cent in October, following advances of 1.8 per cent in September and 1.6 per cent in August. At 116.5 per cent of the 1967 average in October, INDUSTRIAL PRODUCTION total production was 6 per cent above the April low. The October increase was the sixth straight monthly advance. Increases in output were fairly widespread among consumer goods and nondurable industrial materials, but were generally smaller than in the two preceding months. Production of business equipment was off slightly after having increased in the two previous months. Output of final products increased slightly further in October as auto assemblies were again raised, by 2.7 per cent, to an annual rate of 7.7 million units. Production of household appliances, other home goods, and nondurable consumer goods continued to advance. The decline in production of business equipment reflected reduced output of trucks. Output of construction products was unchanged, but that of other intermediate products rose further. Production of durable goods materials was about unchanged in October. Output of iron and steel was off about 1 per cent, following a decline of about one-half of 1 per cent now indicated for F.R. indexes, seasonally adjusted. Latest figures: October. September. Output of other metals edged up last *Auto sales and stocks include imports. Seasonally adjusted 1967 = 100 PPeerr cceenntt cchhaannggeess ffrroomm—— IInndduussttrriiaall pprroodduuccttiioonn 1975 July Aug. Sept." Oct.*- Month Year Q2 to ago ago Q3 Total 112.2 114.0 116.0 116.5 .4 -6.7 3.4 Products, total 115.3 115.8 116.8 117.1 .3 -4.7 2.2 Final products 115.7 116.0 116.9 117.1 .2 -4.3 2.3 Consumer goods 125.5 125.5 126.6 127.4 .6 -.6 3.7 Durable goods 115.9 116.1 117.8 119.2 1.2 -5.8 5.5 Nondurable goods 129.0 129.2 130.0 130.6 .5 1.3 3.1 Business equipment 113.9 114.8 115.9 115.6 -.3 -12.4 .1 Intermediate products 114.3 115.2 116.7 117.3 .5 -6.4 2.2 Construction products 108.0 109.1 111.5 111.5 -13.0 1.2 Materials 106.8 111.2 114.6 115.2 .5 -10.1 5.2 ^Preliminary. Estimated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 1 Financial and Business Statistics CONTENTS GUIDE TO TABULAR PRESENTA- A 32 Federal finance TION ON INSIDE BACK COVER A 34 U.S. Government securities A 37 Federally sponsored credit agencies STATISTICAL RELEASES: REFER- A 38 Security issues ENCE ON INSIDE BACK COVER A 41 Business finance A 42 Real estate credit U.S. STATISTICS A 45 Consumer credit A 48 Industrial production A 2 Member bank reserves, Reserve Bank A 50 Business activity credit, and related items A 50 Construction A 5 Federal funds—Money market banks A 52 Labor force, employment, and A 6 Reserve Bank interest rates unemployment A 7 Reserve requirements A 8 Maximum interest rates; margin A 53 Consumer prices requirements A 53 Wholesale prices A 9 Open market account A 54 National product and income A 10 Federal Reserve Banks A 56 Flow of funds A 11 Bank debits A 12 Money stock INTERNATIONAL STATISTICS A 13 Bank reserves; bank credit A 14 Commercial banks, by classes A 58 U.S. balance of payments A 18 Weekly reporting banks A 59 Foreign trade A 23 Business loans of banks A 59 U.S. reserve assets A 24 Demand deposit ownership A 60 Gold reserves of central banks and A 25 Loan sales by banks governments A 25 Open market paper A 61 International capital transactions of the United States A 26 Interest rates A 74 Open market rates A 29 Security markets A 75 Central bank rates A 29 Stock market credit A 75 Foreign exchange rates A 30 Savings institutions A 82 INDEX TO STATISTICAL TABLES Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 2 BANK RESERVES AND RELATED ITEMS • NOVEMBER 1975 MEMBER BANK RESERVES, FEDERAL RESERVE BANK CREDIT, AND RELATED ITEMS (In millions of dollars) Factors supplying reserve funds Reserve Bank credit outstanding Treas- Period or date U.S. Govt, securities1 Special ury Drawing cur- Gold Rights rency Held Other stock certificate out- Bought under Float 3 F.R. Totals account stand- Total out- repur- assets4 ing right 2 chase agreement Averages of daily figures 1939—Dec 2,510 2,510 83 2,612 17,518 2,956 1941—Dec 2,219 2,219 170 2,404 22,759 3,239 1945—Dec 23,708 23,708 381 652 24,744 20,047 4,322 1950—Dec 20,345 20,336 9 142 1,117 21,606 22,879 4,629 1960—Dec 27,248 27,170 78 94 1,665 29,060 17,954 5,396 1969—De c 57,500 57,295 205 1,086 3,235 2,204 64,100 10,367 6,841 1970—De c 61,688 61,310 378 321 3,570 1,032 66,708 11,105 400 7,145 1971—De c 69,158 68,868 290 107 3,905 982 74,255 10,132 400 7,611 1972—De c 71,094 70,790 304 1,049 3,479 1,138 76,851 10,410 400 8,293 1973—De c 79,701 78,833 868 1,298 3,414 1,079 85,642 11,567 400 8,668 1974—Oc t 83,735 83,303 432 1,793 2,083 2,984 90,971 11,567 400 9,041 Nov 84,052 83,395 657 1,285 2,409 3,171 91,302 11,567 400 9,113 Dec 86,679 85,202 1,477 703 2,734 3,129 93,967 11,630 400 9,179 1975—Ja n 86,039 85,369 670 390 2,456 3,391 93,002 11,647 400 9,235 Feb 84,744 83,843 901 147 2,079 3,419 91,168 11,626 400 9,284 Mar 84,847 84,398 449 . 106 1,994 3,142 90,819 11,620 400 9,362 Apr 87,080 86,117 963 110 2,061 3,237 93,214 11,620 400 9,410 May 91,918 89,355 2,563 60 1,877 3,039 97,845 11,620 429 9,464 June 88,912 87,618 1,294 271 2,046 3,098 95,119 11,620 500 9,536 July 88,166 87,882 284 261 1,911 3,100 94,144 11,620 500 9,616 Aug 86,829 86,348 481 211 1,691 2,953 92,395 11,604 500 9,721 Sept 89,191 87,531 1 .660 396 1,823 3,060 95,277 11,599 500 9,793 Oct.? 90,476 89,547 929 192 1,954 3,521 96.941 11,599 500 9,877 Week ending— 1975—Aug. 6 86,727 86,727 180 1 ,525 3,217 92,328 11,617 500 9,700 13 85,221 85,221 179 1,847 3,225 91 ,135 11,603 500 9,704 20 87,075 86,692 383 204 1,900 2,684 92,538 11,602 500 9,715 27 87,572 86,615 957 272 1,581 2,707 92,885 11,600 500 9,715 Sept. 3 88,224 86,708 1 ,516 222 1 ,548 2,973 93,814 11 ,599 500 9,801 10 86,653 86,653 385 2,036 000 92,736 11.598 500 9,765 17 87,286 86,466 820 327 1,854 097 93,269 11.599 500 9,789 24 90,530 88,373 2,157 395 2,027 062 96,874 11,599 500 9,811 Oct. I 93,192 89,312 3,880 581 1,620 3,145 99,535 11,599 500 *9,819 8 90,561 89,392 1,169 239 1,645 3,348 96,657 11,599 500 9,857 15 88,782 88.782 172 2,029 3,452 95,144 11,599 500 9,873 22p 89,674 88,949 725 233 2,171 3,578 96,407 11,599 500 9,887 29 p 92.027 90,717 1,310 95 1,823 3,666 98,428 11,599 500 9,893 End of month 1975—Aug 88,032 86,677 1 ,355 231 1 ,473 3,012 93,588 11.598 500 9,851 Sept 93,080 89,715 3,365 283 891 3,259 98,461 11.599 500 p9,819 Oct.» 93,426 90.324 3,102 73 1,339 3,939 99,824 11.599 500 9,906 Wednesday 1975—Aug. 6 84,871 84,871 117 2,576 3,228 91,456 11,608 500 9,689 13 86,227 86,227 543 2,194 3,304 92,925 11,602 500 9,710 20 88,832 86,146 2,686 644 2,336 2,604 95,141 11,600 500 9,715 27 86,887 86,887 159 1,919 2,846 92,482 11,599 500 9,715 Sept. 3 89,037 86,647 2,390 208 1 ,732 2,915 94,799 11 ,599 500 9,738 10 85,234 85,234 1 ,695 2,576 3,123 93,280 11,599 500 9,776 17 85,206 85,206 338 2,837 3,075 92,107 11,599 500 9,795 24 93,289 88,656 4,633 1,402 2,406 3,048 101,019 11,599 500 9,819 Oct. 1 92,963 89,660 3.303 615 2,685 3,246 100,446 11,599 500 9,819 8 87,150 87,150 156 2,435 3,386 93,830 11,599 500 9,858 15 87,772 87,772 481 3,172 3,620 95,743 11,599 500 9,882 22P 91,633 89,120 2,513 941 2,421 3,663 99,522 11,599 500 9,893 29 P 93,366 90,317 3,049 98 1,796 3,675 99,832 11,599 500 9,893 1 Includes Federal agency issues held under repurchase agreements 4 Beginning Apr. 16, 1969, "Other F.R. assets" and "Other F.R. beginning Dec. 1, 1966, and Federal agency issues bought outright be- liabilities and capital" are shown separately; formerly, they were netted ginning Sept. 29, 1971. together and reported as "Other F.R. accounts." 2 Includes, beginning 1969, securities loaned—fully guaranteed by U.S. 5 Includes industrial loans and acceptances until Aug. 21, 1959, when Govt, securities pledged with F.R. Banks, and excludes (if any), securities industrial loan program was discontinued. For holdings of acceptances sold and. scheduled to be bought back under matched sale-purchase on Wed. and end-of-month dates, see table on F.R. Banks on p. A-10. transactions. See also note 3. 3 Beginning with 1960 reflects a minor change in concept; see Feb. 1961 BULLETIN, p. 164. Notes continued on opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • BANK RESERVES AND RELATED ITEMS A 3 MEMBER BANK RESERVES, FEDERAL RESERVE BANK CREDIT, AND RELATED ITEMS—Continued (In millions of dollars) Factors absorbing reserve funds Deposits, other than member bank Member bank Cur- Treas- reserves Other reserves rency ury with F.R. Banks Other F.R. Period or date in cash F.R. liacir- hold- ac- bilities cula- ings counts4 and With Curtion Treas- For- Other 3,6 capital* F.R. rency Total 8 ury eign Banks and coin 7 Averages of daily figures 7,609 2,402 616 i:J 9 248 11,473 11,473 .1939—Dec. 10,985 2,189 592 1,531 292 12,812 12,812 .1941—Dec. 28,452 2,269 625 1,247 493 16,027 16,027 .1945—Dec. 27,806 1,290 615 920 353 739 17,391 17,391 .1950—Dec. 33,019 408 522 250 495 1,029 16,688 2,595 19,283 .1960—Dec. 53,591 656 1,194 146 458 2,192 23,071 4,960 28,031 .1969—Dec. 57,013 427 849 145 735 2.265 23,925 5,340 29,265 .1970—Dec. 61,060 453 1 .926 290 728 2,287 25,653 5,676 31,329 .1971—Dec. 66,060 350 1,449 272 631 2,362 24,830 6,095 31,353 . 1972—Dec. 71,646 323 1,892 406 717 2,942 28,352 6,635 35,068 . 1973—Dec. 75,654 315 1,601 294 869 3,260 29,985 6,811 36,796 .1974—Oct. 77,029 302 864 370 770 3,149 29,898 6,939 36,837 Nov. 78,951 220 1,741 357 874 3.266 29,767 7,174 36,941 Dec. 77,780 221 2,087 336 884 3,264 29,713 7,779 37,492 1975—Jan. 76,979 236 2,374 317 711 3,358 28,503 7,062 35,565 Feb. 77,692 277 1 ,887 363 958 3,076 27,948 6,831 34,779 Mar. 78,377 309 3,532 307 718 3,137 28,264 6,870 35,134 Apr. 79,102 326 8,115 262 746 3,231 27,576 6,916 34,492 May 80,607 355 3,353 272 989 3,191 28,007 6,969 34,976 June 81,758 358 2,207 269 711 3,135 27,442 7,213 34,655 July 81,822 368 818 274 660 3,096 27,183 7,299 34,482 Aug. 81,903 361 4 3,415 308 798 3,169 27,215 7,431 34,646 Sept. 82,215 387 4,940 271 632 3,208 27,264 7,319 34,583 Oct. v Week ending— 81,531 354 1,205 277 662 3,108 27,007 7,546 34,553 . 1975—Aug. 6 82,036 377 209 271 607 2,941 26,501 7,662 34,163 13 82,028 366 299 302 583 3,060 27,717 6,912 34,629 20 81,615 366 1 ,178 240 715 3,196 27,390 7,080 34,470 27 81,979 363 1 ,806 300 839 3,253 27,173 7,356 34,529 .Sept. 3 82,242 359 1 ,402 351 840 2,913 26,493 7,605 34,098 10 82,166 354 1,181 326 946 3,069 27,116 7,436 34,552 17 81,688 364 5,032 285 717 3.256 27,442 7,175 34.617 24 p 81,395 P 373 7,413 277 650 3.463 27,883 7,561 35,444 .Oct. 1 81,853 371 5,863 235 570 3,044 26,678 7.582 34,260 82,561 381 3,091 340 617 3,091 27,036 7.618 34,654 . 15 82,451 382 3,575 245 656 3.221 27,864 6,741 34,605 .22p 82,116 370 6,148 265 664 3.375 27,483 7,246 34,729 ,29p End of month 81,912 364 2,349 342 776 3,311 26,484 7,356 33,840 . 1975—Aug. p 81,609 P 370 8,075 324 616 3,472 25,913 7,561 33,474 Sept. 82,201 370 8,517 297 594 3.498 26.352 7,515 33.867 Oct. p Wednesday 82,064 351 * 259 665 2,895 27,018 7,546 34,564 .1975—Aug. 6 82,328 359 * 293 594 2,989 28,174 7,662 35,836 13 82,059 342 660 333 554 3,148 29,861 6,912 36,773 20 81,881 359 833 232 838 3,217 26,937 7,080 34,017 27 82,346 363 804 247 868 2,913 29,096 7,356 36,452 .Sept. 3 82,490 357 405 295 1 ,036 2,949 27,623 7,605 35,228 10 82,169 346 2,421 242 854 3,060 24,908 7,436 32,344 17 81,694 356 7,249 234 660 3,381 29,363 7,175 36,538 24 81,671 383 7,637 283 824 3,417 28,149 7,561 35,710 . Oct. 1 82,425 374 3,691 234 568 3,046 25,449 7,582 33,031 82,876 384 2,703 877 642 3,129 27.114 7,618 34,732 .15 82,467 384 6,074 214 817 3,317 28,241 6,741 34,982 .22* 82,366 370 6,124 236 594 3.446 28,688 7.246 35.934 .29 p 6 Includes certain deposits of domestic nonmember banks and foreign- averages. Beginning Sept. 12, 1968, amount is based on close-of-business owned banking institutions held with member banks and redeposited in figures for reserve period 2 weeks previous to report date. full with F.R. Banks in connection with voluntary participation by non- 8 Beginning with week ending Nov. 15, 1972, includes $450 million of member institutions in the Federal Reserve System's program of credit reserve deficiencies on which F.R. Banks are allowed to waive penalties restraint. for a transition period in connection with bank adaptation to Regulation J As of Dec. 12, 1974, the amount of voluntary nonmember and foreign as amended effective Nov. 9, 1972. Beginning 1973, allowable deficiencies agency and branch deposits at F.R. Banks that are associated with margi- included are (beginning with first statement week of quarter): Ql, $279 nal reserves are no longer reported. However, deposits voluntarily held million; Q2, $172 million; Q3, $112 million; Q4, $84 million. Beginning by agencies and branches of foreign banks operating in the United States 1974, Ql, $67 million, Q2, $58 million. Transition period ended after as reserves and Euro-dollar liabilities are reported. second quarter, 1974. 7 Part allowed as reserves Dec. 1, 1959—Nov. 23, 1960; all allowed thereafter. Beginning Jan. 1963, figures are estimated except for weekly For other notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 4 BANK RESERVES AND RELATED ITEMS • NOVEMBER 1975 RESERVES AND BORROWINGS OF MEMBER BANKS (In millions of dollars) All member banks Large banks2 All other banks Borrowings New York City City of Chicago Other Total Re- Excess1 Total Sea- Excess Borrow- Excess Borrow- Excess Borrow- Excess Borrowheld 1 quired sonal ings ings ings ings 1939—Dec.. 11,473 6,462 5,01 3 2,611 540 1,188 671 3 1941—Dec.. 12,812 9,422 3,390 5 989 295 1,303 1 804 4 1945—Dec.. 16,027 14,536 1,491 334 48 192 14 418 96 1,011 46 1950—Dec.. 17,391 16,364 1,027 142 125 58 232 50 663 29 1960—Dec.. 19,283 18,527 756 87 29 19 100 20 623 40 1965—Dec.. 22,719 22,267 452 454 41 111 67 228 330 92 1967—Dec.. 25,260 24,915 345 238 18 40 50 105 267 80 1968—Dec.. 27,221 26,766 455 765 100 230 15 90 270 250 180 1969—Dec.. 28,031 27,774 257 1,086 56 259 18 6 479 177 321 1970—Dec.. 29,265 28,993 272 321 34 25 7 42 264 189 28 1971—Dec.. 31,329 31,164 165 107 25 35 1 -35 22 174 42 1972—Dec.. 31,353 31,134 219 1,049 -20 301 13 -42 429 -160 264 1973—Dec.. 35,068 34,806 262 1,298 41 -23 74 43 28 761 133 435 1974—Oct.. 36,796 36,705 91 1,793 117 -49 502 -18 36 569 122 686 Nov.. 36,837 36,579 258 1,285 67 -8 257 38 90 566 138 448 Dec.. 36,941 36,602 339 703 32 132 80 5 39 323 163 282 1975--Jan... 37,492 37,556 -64 390 13 -119 156 -16 -91 87 162 131 Feb... 35,565 35,333 232 147 10 31 37 17 41 29 143 71 Mar.. 34,779 34,513 266 106 7 53 22 20 56 28 137 46 Apr... 35,134 35,014 120 110 7 32 25 -23 -4 38 115 33 May. , 34,492 34,493 -1 60 9 -28 24 -21 -89 13 137 23 June.. 34,976 34,428 548 271 11 142 90 47 217 114 142 65 J A u u l g y . . . . 3 3 4 4 , , 6 4 5 8 5 2 3 34 4 , , 2 6 6 8 5 7 - 2 3 1 2 7 2 21 61 1 3 1 8 7 - - 2 1 2 8 5 1 4 4 -24 5 -11 9 8 8 6 5 2 1 1 1 3 3 2 2 1 1 4 2 5 2 Sept.. 34,646 34,447 199 396 61 17 68 27 23 141 132 185 Oct.P. 34,583 34,414 169 192 65 -10 31 -28 -40 32 126 129 Week ending- 1974—Oct. 37,533 37,077 456 3,218 143 67 1,756 17 222 532 158 913 36,601 36,656 -55 2,245 132 -26 1.245 -29o! 10 -127 336 118 654 37,415 37,088 327 1,744 121 41 219 27 135 99 784 160 606 36,456 36,615 -159 1,322 108 -101 148 -12 2 -122 509 76 663 30 36,819 36,576 243 1,638 105 109 96 -9 11 42 730 101 801 1975—Apr. 2. 35,087 34,808 279 51 -30 7 99 8 203 43 9. 34,663 34,552 111 30 62 15 -51 7 85 23 16. 35,295 35,076 219 22 25 -14 36 4 172 18 23. 35,249 35,179 70 165 -3 16 -23 77 80 21 30. 35,495 35,306 189 241 -11 1 56 71 143 66 May 7. 35,237 34,926 311 34 177 21 -5 118 34 14. 34,517 34,518 -1 17 -106 -26 -17 1 148 16 21. 34,702 34,631 71 121 7 -33 9 -34 2 129 21 28. 34,209 34,045 164 84 9 53 4 -5 54 112 21 June 4. 34,511 34,177 334 84 9 18 61 19 137 160 23 11. 33,707 33,743 -36 38 11 -76 -32 -55 2 127 25 18. 34,937 34,603 334 77 10 80 12 69 173 28 25. 34,706 34,615 91 188 11 19 -4 5 38 71 53 July 2.. 35,481 35,085 396 871 15 57 189 39 117 468 183 214 9.. 34,612 34,479 133 222 13 18 -20 -20 90 155 132 16.. 34,864 34,791 73 202 15 -72 78 2 6 16 137 54 23.. 34,898 34,695 203 382 19 107 151 9 -13 57 100 124 30.. 34,999 34,718 281 253 23 82 15 67 91 117 162 Auc. 6. 34,553 34,354 199 180 29 13 10 31 14 145 166 13. 34,163 34,147 16 179 35 -46 47 -22 -45 18 129 108 20. 34,629 34,418 211 204 37 -4 19 73 77 123 127 27. 34,470 34,174 296 272 40 127 '\5' -7 48 87 128 170 Sept. 3. 34,529 34,228 301 222 50 28 24 81 58 168 164 10. 34,098 34,104 -6 385 53 -45 215 -31 -66 34 136 136 17. 34,552 34,285 267 327 60 79 19 17 174 152 142 Sept. 24. 34,617 34,584 33 395 64 -66 "79 -2 28 115 73 201 Oct. 1 . . 35,444 34,982 462 581 73 149 2 147 304 164 277 8.. 34,260 34,284 -24 239 74 -83 -16 -52 51 127 188 15. . 34,654 34,358 296 172 65 -9 39 33 94 12 178 121 IIP. 34,605 34,576 29 233 63 -56 97 -32 -44 22 126 114 29v. 34,729 34,443 286 95 | 61 70 7 -9 7 97 88 1 Beginning with week ending Nov. 15, 1972, includes $450 million of demand deposits of more than $400 million), as described in the BULLETIN reserve deficiencies on which F.R. Banks are allowed to waive penalties for July 1972, p. 626. Categories shown here as "Large" and "All other" for a transition period in connection with bank adaptation to Regulation J parallel the previous "Reserve city" and "Country" categories, respectively as amended effective Nov. 9, 1972. Beginning 1973, allowable deficiencies (hence the series are continuous over time). included are (beginning with first statement week of quarter): Ql, $279 million; Q2, $172 million; Q3, $112 million; Q4, $84 million. Beginning NOTE.—Monthly and weekly data are averages of daily figures within 1974, Ql, $67 million; Q2, $58 million. Transition period ended after the month or week, respectively. second quarter, 1974. For weeks for which figures are preliminary, figures Borrowings at F.R. Banks: Based on closing figures. by class of bank do not add to the total because adjusted data by class are Effective Apr. 19, 1973, the Board's Regulation A, which governs lendnot available. ing by F.R. Banks, was revised to assist smaller member banks to meet 2 Beginning Nov. 9, 1972, designation of banks as reserve city banks the seasonal borrowing needs of their communities. for reserve-requirement purposes has been based on size of bank (net Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • MONEY MARKET BANKS A 5 BASIC RESERVE POSITION, AND FEDERAL FUNDS AND RELATED TRANSACTIONS (In millions of dollars, except as noted) Basic reserve position Interbank Federal funds transactions Related transactions with U.S. Govt, securities dealers Net- Gross transactions Net transactions Reporting banks and Total Borweek ending— Excess Net Per cent two-way Pur- Loans row- Net re- Bor- inter- Surplus of Pur- trans- chases Sales to ings loans serves 1 rowings bank or avg. chases actions 2 of net of net dealers3 from at F.R. Federal deficit required buying selling dealers4 Banks funds reserves banks banks trans. Total—46 banks 1975—Sept. 3. 222 12,357 -12,143 78.4 18,973 6,616 5,682 13,291 934 2,027 619 1 ,408 10. -23 240 15,099 -15,362 99.2 20,512 5,413 4,697 15,815 716 2,830 340 2,490 17. 53 126 13,953 -14,026 90.1 18,658 4,705 4,395 14,262 309 3,095 368 2,727 24. 13 120 11,476 -11,583 74.4 16,937 5,461 4,395 12,542 1 ,066 2,365 431 1 ,934 Oct. 1 . 227 130 9,880 -9,783 61 .6 16,736 6,856 4,761 11,975 2,094 2,067 456 1,612 8. 3 12,583 -12,586 80.9 18,090 5,508 4,399 13,691 1,109 3,124 430 2,694 15. 50 13,531 -13,517 86.1 19,099 5,568 4,100 14,999 1 ,468 3,950 332 3,618 22. 102 11,513 -11,635 73.9 17,314 5,802 4,405 12,909 1 ,397 2,943 363 2,580 29. 9,960 -9,867 63.8 15,987 6,027 4,387 11,600 1 ,640 2,248 402 1 ,846 S in New York City 1975—Sept. 3. 130 2,874 -2,745 43.7 4,796 1 ,922 ,778 3,019 144 1 ,046 298 747 10. -14 215 4,655 -4,884 76.8 5,403 748 729 4,675 19 1 ,268 241 1,027 17. 71 4,003 -3,932 62.3 4,658 655 656 4,002 1 ,306 211 1 ,095 24. -28 ' '79 3,083 -3,190 51 .2 4,332 1 ,249 ,007 3,325 242 1,116 210 906 Oct. 1 . 122 2,697 -2,575 40.0 3,946 1,248 ,026 2,919 222 1,062 233 829 -9 2,654 -2,662 42.3 3,873 1,219 956 2,917 263 1 ,472 221 1 ,251 15. -14 3,422 -3,475 55.1 4,331 910 769 3,562 140 1,923 158 1 ,765 22. -31 2,110 -2,236 35.0 3,456 1,346 993 2,463 353 1 ,529 165 1 ,364 29. 69 2,274 -2,206 35.8 3,487 1,212 975 2,512 238 1,250 186 1,063 38 outside New York City 1975—Sept. 3 92 9,483 -9,399 102.1 14,177 4,694 3,905 10,273 789 982 321 661 10 -9 26 10,444 -10,478 114.7 15,109 4,665 3,968 11,141 697 1 ,562 99 1 ,462 17 -18 126 9,951 -10,094 109.0 14,000 4,049 3,740 10,260 309 1 ,789 157 1 ,632 24 41 41 8,393 -8,393 89.9 12,605 4,212 3,388 9,217 824 1 ,249 221 I ,028 Oct. 1 106 130 7,183 -7,207 76.2 12,790 5,608 3,735 9,055 1 ,872 1 ,006 222 783 8 9 3 9,929 -9,923 107.1 14,217 4,288 3,443 10,774 845 1,651 208 1 ,443 15 78 11 10,110 -10,042 106.8 14,768 4,658 3,331 11,437 1,328 2,027 174 1 ,852 22 11 7 9,403 -9,399 100.5 13,858 4,456 3,412 10,446 1,044 1,414 198 1 ,216 29 25 7,686 -7,661 82.5 12,500 4,815 3,412 9,088 1,402 998 216 783 5 in City of Chicago 1975—Sept. 3 33 3,821 -3,788 226.2 5,087 1 ,266 1 ,122 3,966 145 315 315 10 -17 4,264 -4,281 264.0 5,351 1 ,088 1 ,058 4,293 29 403 403 17 6 3,852 -3,858 225.8 4,888 1 ,036 1,014 3,874 22 421 421 24 3 2,958 -2,955 179.1 4,306 1 ,348 1,202 3,103 145 321 321 Oct. 1 3 2,829 -2,826 166.9 4,161 1,333 1,162 3,000 171 313 313 8 -12 3,875 -3,887 232.0 4,868 993 987 3,881 6 514 514 15 15 4,437 -4,422 256.4 5,281 844 844 4,437 631 631 22 -12 4,098 -4,109 246.2 5,048 950 933 4,114 545 545 29 14 3,729 -3,715 228.8 4,743 1 ,014 996 3,747 496 496 33 others 1975—Sept. 3 60 5,662 -5,610 74.5 9,090 3,428 2,783 6,307 644 667 321 346 10 8 26 6,181 -6,198 82.5 9,758 3,577 2,910 6,848 667 1 ,159 99 1 ,059 17 -23 115 6,098 -6,236 82.6 9,111 3,013 2,726 6,386 287 1 ,368 157 1 ,211 24 38 41 5,435 -5,438 70.8 8,299 2,864 2,185 6,114 679 928 221 707 Oct. 1 102 130 4,354 -4,382 56.4 8,629 4,275 2,574 6,055 1,701 692 222 470 8 21 3 6,054 -6,036 79.5 9,349 3,296 2,456 6,894 840 1,138 208 930 15 63 11 5,673 -5,620 73.2 9,488 3,815 2,487 7,000 1,328 1,396 174 1,222 22 23 7 5,305 -5,286 68.9 8,811 3,506 2,478 6,332 1,027 869 198 671 29 11 3,957 -3,946 51.5 7,758 3,801 2,417 5,341 1,384 502 216 286 1 Bas:d upon reserve balances, including all adjustments applicable to banks, repurchase agreements (purchases of securities from dealers the reporting period. Prior to Sept. 25, 1968, carryover reserve deficiencies, subject to resale), or other lending arrangements. if any, were deducted. Excess reserves for later periods are net of all carry- 4 Federal funds borrowed, net funds acquired from each dealer by over reserves. clearing banks, reverse repurchase agreements (sales of securities to 2 Derived from averages for individual banks for entire week. Figure dealers subject to repurchase), resale agreements, and borrowings secured for each bank indicates extent to which the bank's weekly average pur- by Govt, or other issues. chases and sales are offsetting. NOTE.—Weekly averages of daily figures. For description of series 3 Federal funds loaned, net funds supplied to each dealer by clearing and back data, see Aug. 1964 BULLETIN, pp. 944-74. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 6 F.R. BANK INTEREST RATES • NOVEMBER 1975 CURRENT RATES (Per cent per annum) Loans to member banks— Under Sec. 10(b) 2 Loans to all others under Under Sees. 13 and 13a1 last par. Sec. 134 Federal Reserve Bank Regular rate Special rate3 Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous 10/31/75 date rate 10/31/75 date rate 10/31/75 date3 rate 10/31/75 date rate N Bo ew st o Y n ork 6 6 5 5 / / 1 1 6 6 / / 7 7 5 5 e 61 y /4 4 6 61 y /22 5 5 / / 1 1 6 6 / / 7 7 5 5 6 6 3 3 / / 4 4 7 7 6 7 /2 /2 4 / / 7 7 5 5 I I V V i i 9 9 3 3 / / 1 1 0 0 / / 7 7 5 5 9 9 1 1 / / 2 2 Philadelphia 6 5/16/75 614 6I/2 5/16/75 634 7 6/9/75 71/2 9 3/10/75 91/2 Cleveland .' 6 5/16/75 61/4 6% 5/16/75 63,4 7 6/9/75 71/2 9 3/10/75 91/2 R C S A M t i h t . i c l n i a h L c n n m a o e t g u a a o o i p n s o d l is 6 6 6 6 6 5 5 5 5 5 / / / / / 1 1 1 1 2 6 6 6 6 3 / / / / / 7 7 7 7 7 5 5 5 5 5 6 6 6 6 6 1 1 1 % V / / / 4 4 2 4 6 6 6 6 6 V 1 i j I / / / / 2 2 2 2 2 5 5 5 5 5 / / / / / 1 1 1 1 2 6 6 6 6 3 / / / / / 7 7 7 7 7 5 5 5 5 5 6 e 6 6 6 3 3 3 y V / / / 4 4 4 4 4 7 7 7 7 7 7 6 6 6 / 6 1 / / / / 9 3 5 9 9 / / / / / 7 7 7 7 7 5 5 5 5 5 7 I 7 7 7 1 1 V 1 1 / / / / 2 2 2 2 i 9 9 9 9 9 3 3 3 3 3 / / / / / 1 1 1 1 1 0 0 4 4 0 / / / / / 7 7 7 7 7 5 5 5 5 5 9 9 9 9 9 1 1 1 1 1 / / / / / 2 2 2 2 2 K Da a l n l s a a s s City 6 6 5 5 / / 1 1 6 6 / / 7 7 5 5 6 61 14 /4 6 61 ^ / 2 2 5 5 / / 1 1 6 6 / / 7 7 5 5 6 63 3 / 4 4 7 7 7 6 / / 9 9 / / 7 7 5 5 7 71 i/ / 2 2 9 9 3 3 / / 1 1 0 4 / / 7 7 5 5 9 9 1 1 / / 2 2 San Francisco 6 5/16/75 6*4 61/2 5/16/75 63/4 7 6/24/75 71/2 9 3/10/75 9*/2 1 Discounts of eligible paper and advances secured by such paper or by 3 Applicable to special advances described in Section 201.2(e)(2) of U.S. Govt, obligations or any other obligations eligible for F.R. Bank Regulation A. purchase. 4 Advances to individuals, partnerships, or corporations other than 2 Advances secured to the satisfaction of the F.R. Bank. Advances member banks secured by direct obligations of, or obligations fully secured by mortgages on 1- to 4-family residential property are made at guaranteed as to principal and interest by. the U.S. Govt, or any the Section 1 3 rate. agency thereof. SUMMARY OF EARLIER CHANGES (Per cent per annum) Range F.R. Range F.R. Range Effective (or level)— Bank Effective (or level)— Bank Effective (or level)— date All F.R. of date All F.R. of date All F.R. Banks N.Y. Banks N.Y. Banks I 1 n 9 5 e 6 f — fec A t p D r e . c. 1 3 3 1, 1955 2V 2 4 % -3 2 2 V 3/4 4 1964—Nov. 2 3 4 0 3V 42 -4 4 4 - D N e o c v . . 1 1 9 1 , . 4 4 1 3 / / 4 2 4 3 - - / 4 5 4 3 /4 4 4 5 3 3 / 4 4 Aug. 2 2 0 4 2 23 3 / 4 4 - - 3 3 2 3 3 /4 1965—Dec. 1 6 3 4 4 - % 4i /2 4 41 1 / / 2 2 24, 41/ 4 2 1 - / 4 2 3 /4 4 41 1 / / 2 2 31 3 3 1967—Apr. 7 4 -41/2 -Jan. 15. 5 5 1957— N Au ov g . . 2 1 3 5 3 3 31 - - 3 / 3 2 1 i / / 2 2 3 3 3 1 /2 Nov. 2 2 1 0 7 4 , , 4 4 41 - / 4 2 1/ 2 4 4 1 1 / / 2 2 M A Fe p a b r r . . . 2. 5 51 / 5 2 1 - - / 5 5 2 % i /2 5 5 5 * 1 !/ / / 2 2 2 Dec. 2 3 3 1968—Mar. 15, 41/2-5 41/2 May 4, 53/4 534 1958—Jan. 22 23^-3 3 Apr. 2 1 2 9 , 5 5 -51/2 5 51 /2 1 1 1 8 , 53 6 4 -6 6 6 Mar. 2 1 4 7 3 2 2 21 1 3 / / / 4 4 4- - - 2 3 3 3 /4 2 2 2 3 1 1 / / / 4 4 4 Aua. 12 3 6 0 6, 5i, 5 5 4 1 - % 5 4 i / 2 5 5 5 1 1 1/ / / 4 2 2 J J u u n ly e 1 2 1 . 6 6 7 1 - / 6 2 1 /2 6 6 7 ! ' / / 2 2 21 21/4 21/4 Dec. 18 51/4-51/2 51/2 Aug. 14, 7 -71/2 71/2 Apr. 18 13/4-21/4 13/4 20 5y 51/2 23, m 71/2 May 9 13/4 13/4 2 S A e u p g t . . 1 1 5 2 1 13 3 / / 4 4- - 2 2 2 13 /4 1969—Apr. 4 8 51/ 6 2 -6 6 6 -Apr. 2 3 5 0 , 71/g2 -8 8 g O No ct v . . 2 2 3 4 7 2 2 2 % -2i /2 2 2 2V i 1970—Nov. 1 1 1 3 5 5 3 3 / / 4 4 - - 6 6 5 6 3/4 Dec. 1 9 6 , 73/ 7 4 3 - / 8 4 7 7 3 3 4 4 1959—M M a a r y . 2 1 9 6 6 2 3 i / 3 2- - 3 31 /2 3 3 31 /2 Dec. 1 1 1 1 4 6 5 5 ^ i/ 2 2 5 5 - - y 5 5 3 2 3 / 3 4 / / 4 4 5 5 5 5 3 3 y % / / 4 2 4 -J F a e n b . . 2 1 4 5 6 0 6 7 7 1 3 1 / / 4 1 4 4 - - 7 V - 7 1 7 3 / 4 / 3 4 4 4 1 7 7 63 3 * V / / 4 4 4 4 J S u ep n t e . 1 1 2 1 3^ 3 2 ! - / 4 2 4 3% 1971—Jan. 8 51/4-51/2 5V4 Mar. 1 7 0 61/ 6 4 3 - / 6 4 3 /4 6 61 3 / /4 4 18 4 4 15 51/4 51/4 14 61/4 61/4 1960—J S A u e u n p g e t . . 1 1 1 4 2 0 3 3 3 3 % j / 3 2 3 -4 - * - 3 4 /2 1 /2 4 3 m 3 3 % J F u e l b y . 2 2 1 1 1 1 2 9 6 9 3 9 4 4 5 5 3 3 / / 4 5 5 4 4 - - 3 5 5 - - / 5 5 1 1 4 / / 4 4 5 5 5 5 5 4 1 3 / / 4 4 In effec M t, a O y ct 2 . 1 3 3 6 1 , 1975. 6 6 6 -61/4 6 6 6 1963—July 17 3 -31/2 31/2 23 5 26 31/2 3y2 NOTE.—Rates under Sees. 13 and 13a (as described in table and notes above). For data before 1956, see Banking and Monetary Statistics, 1943, pp. 439-42, and Supplement to Section 12, p. 31. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • RESERVE REQUIREMENTS A 7 RESERVE REQUIREMENTS ON DEPOSITS OF MEMBER BANKS (Deposit intervals are in millions of dollars. Requirements are in per cent of deposits.) Net demand 2 Time 3 (all classes of banks) EEEffffffeeeccctttiiivvveee dddaaattteee iii Reserve city Other Other time SSaavviinnggss 0-5 Over 5 0-5 Over 5 0-5 Over 5 In effect Jan. 1, 1963 16y2 12 44 1966—July 14,21 44 44 555 Sept. 8,15 666 1967—Mar. 2 333^^^222 333111///222 Mar. 16 333 333 1968—Jan. 11,18 111666111///222 111777 111222 111222111///222 1969—Apr. 17 111777 111777111///222 111222111///222 111333 1970—Oct. 1 55 Beginning Nov. 9, 1972 Net demand2,4 Time3 Other time EEEEffffffffeeeeccccttttiiiivvvveeee ddddaaaatttteeee 000---222 222---111000 111000---111000000 111000000---444000000 OOOvvveeerrr SSSaaavvviiinnngggsss 0-5, maturing in— Over 55, maturing in— 444000000 Less than 4 years 30-179 180 days 4 years 4 years or more days to 4 years or more 1972—Nov. 9 8 10 12 666 III666III///222 171/2 7 3 7 3 7 5 Nov. 16 111333 1973—juiy 19 IIdd//22 112211//22 111333111///222 11118888 1974—Dec. 12 11117777iiii////2222 66 33 1975—Feb. 13 iiVVii 1100 1122 1133 IIII6666IIII////2222 Oct. 30 33 88 11 33 II 88 11 In effect Oct. 31, 1975.. m 10 12 13 I6I/2 3 33 88 11 6 33 88 11 Present legal limits: Minimum Maximum Net demand deposits, reserve city banks 10 22 Net demand deposits, other banks 7 14 Time deposits 3 10 1 When two dates are shown, the first applies to the change at reserve member bank will maintain reserves related to the size of its net demand city banks and the second to the change at country banks. For changes deposits. The new reserve city designations are as follows: A bank having prior to 1963 see Board's Annual Reports. net demand deposits of more than $400 million is considered to have the 2 (a) Demand deposits subject to reserve requirements are gross de- character of business of a reserve city bank, and the presence of the head mand deposits minus cash items in process of collection and demand office of such a bank constitutes designation of that place as a reserve balances due from domestic banks. city. Cities in which there are F.R. Banks or branches are also (b) Requirement schedules are graduated, and each deposit interval reserve cities. Any hanks having net demand deposits of $400 million or applies to that part of the deposits of each bank. less are considered to have the character of business of banks outside of (c) Since Oct. 16, 1969, member banks have been required under reserve cities and are permitted to maintain reserves at ratios set for banks Regulation M to maintain reserves against foreign branch deposits not in reserve cities. For details, see Regulation D and appropriate supcomputed on the basis of net balances due from domestic offices to their plements and amendments. foreign branches and against foreign branch loans to U.S. residents. 5 A marginal reserve requirement was in effect between June 21, 1973, Since June 21, 1973, loans aggregating $100,000 or less to any U.S. resident and Dec. 11, 1974, against increases in the aggregate of the following types have been excluded from computations, as have total loans of a bank to of obligations: (a) outstanding time deposits of $100,000 or more, (b) U.S. residents if not exceeding $1 million. Regulation D imposes a similar outstanding funds obtained by the bank through issuance by a bank's reserve requirement on borrowings from foreign banks by domestic offices affiliate of obligations subject to existing reserve requirements on time of a member bank. The reserve percentage applicable to each of these deposits, and (c) beginning July 12, 1973, funds from sales of finance bills. classifications is 4 per cent. The requirement was 10 per cent originally, The requirement applied to balances above a specified base, but was not was increased to 20 per cent on Jan. 7, 1971, was reduced to 8 per cent applicable to banks having obligations of these types aggregating less effective June 21, 1973, and was reduced to the current 4 per cent effective than $10 million. For details, including percentages and maturity classifi- May 22, 1975. Initially certain base amounts were exempted in the com- cations, see "Announcements" in BULLETINS for May, July, Sept., and putation of the requirements, but effective Mar. 14, 1974, the last of these Dec. 1973 and Sept. and Nov. 1974. reserve-free bases were eliminated. For details, see Regulations D and M. 6 The 16 l/i per cent requirement applied for one week, only to former 3 Effective Jan. 5, 1967, time deposits such as Christmas and vacation reserve city banks. For other banks, the 13 per cent requirement was club accounts became subject to same requirements as savings deposits. continued in this deposit interval. Beginning Nov. 10, 1975, profitmaking businesses may maintain savings 7 See columns above for earliest effective date of this rate. deposits of $150,000 or less at member banks. For details see "Amend- 8 The average of reserves on savings and other time deposits must be ments to Regulations D and Q," p. 769; also, "Announcements" in BUL- at least 3 per cent, the minimum prescribed by law. For details see "Amend- LETIN for Oct., p. 708. ments to Regulation D," p. 769; also, "Announcements" in BULLETIN Notes 2(b) and 2(c) above are also relevant to time deposits. for Oct., p. 705. 4 Effective Nov. 9, 1972, a new criterion was adopted to designate reserve cities, and on the same date requirements for reserves against net NOTE.—Required reserves must be held in the form of deposits with demand deposits of member banks were restructured to provide that each F.R. Banks or vault cash. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 8 MAXIMUM INTEREST RATES; MARGIN REQUIREMENTS • NOVEMBER 1975 MAXIMUM INTEREST RATES PAYABLE ON TIME AND SAVINGS DEPOSITS (Per cent per annum) Rates July 20, 1966—June 30, 1973 Rates beginning July 1, 1973 Effective date Effective date Type and size July 20, Sept. 26, Apr. 19, Jan. 21, Type and size July 1, Nov. 1, Nov. 27, Dec. 23, of deposit 1966 1966 1968 1970 of deposit 1973 1973 1974 1974 Savings deposits 41/2 Savings deposits Other time deposits:1 Other time deposits (multiple- Multiple maturity: 2 and single-maturity):1, 2 30-89 days 4 41/2 Less than $100,000: 90 days to 1 year. 5 30-89 days 5 5 5 5 1-2 years 5% 90 days to 1 year 51/2 51/2 51/2 51/2 2 years or more.., 5V4 I-21/2 years 6 6 6 6 Single-maturity: 5 2V2. years or more 61/2 61/2 61/2 61/2 Less than $100,000: Minimum denomination 30 days to 1 year. 5 of $1,000: $1 6 9 2 3 0 1 0 0 0 0 - y 2 - - , - 0 e 1 8 5 a 0 9 9 7 y r 0 9 s e d d a o o a d a r r r y y s a s s y m m s o o r r e e : . . 5!/ 2 51/2 5 6 V 2 55 ( ( ( V 3 3 3 ) ) ) yi 4 $1 G 00 o 4 6 , v 0 - e 6 y 0 r 0 e n y a m o e rs a r e r o m s n r t o a m l r e o u r n e i ts ( ( ( 5 3 4 ) ) ) I ( ( V 3 5) A ) I I ( V V3 A ) 2 I I7 ( V V 3 1A/ ) A 2 1 1 8 y 0 e d ar a y o s r to m 1 o r y e e . a . r . 51/2 6 6 1 V / 4 4 ( ( 3 3 ) ) 1 For exceptions with respect to certain foreign time deposits, see amount were subject to the 6V2 per cent ceiling that applies to time de- BULLETIN for Feb. 1968, p. 167. posits maturing in 2l/i years or more. 2 Multiple-maturity time deposits include deposits that are automati- Effective Nov. 1, 1973, a ceiling rate of IVA per cent was imposed on cally renewable at maturity without action by the depositor and deposits certificates maturing in 4 years or more with minimum denominations that are payable after written notice of withdrawal. of $1,000. There is no limitation on the amount of these certificates that 3 Maximum rates on all single-maturity time deposits in denominations banks may issue. of $100,000 or more have been suspended. Rates that were effective 5 Prior to Nov. 27, 1974, no distinction was made between the time Jan. 21, 1970, and the dates when they were suspended are: deposits of governmental units and of other holders, insofar as Regulation Q ceilings on rates payable were concerned. Effective Nov. 27, 1974, 6 3 0 0 - - 8 5 9 9 d d a a y y s s 6 6V V 2 A p p e e r r c c e e n n t t l f June 24, 1970 g re o c v e e iv rn e m in e t n e t r a e l s t u r n a i t t e s s w on e r t e i m p e e r d m ep it o te s d it s t w o it h h o l d d e n s o a m vi i n n g a s t io d n e s p o u s n it d s er a n $ d 1 0 c 0 o ,0 u 0 ld 0 90-179 days 61/4 per cent I irrespective of maturity, as high as the maximum rate permitted on such 180 days to 1 year 7 per cent [ May 16, 1973 deposits at any Federally insured depositary institution. 1 year or more ll/i per cent j NOTE.— Maximum rates that may be paid by member banks are estab- Rates on multiple-maturity time deposits in denominations of $100,000 lished by the Board of Governors under provisions of Regulation Q; or more were suspended July 16, 1973, when the distinction between however, a member bank may not pay a rate in excess of the maximum single- and multiple-maturity deposits was eliminated. rate payable by State banks or trust companies on like deposits under 4 Between July 1 and Oct. 31, 1973, there was no ceiling for certificates the laws of the State in which the member bank is located. Beginning maturing in 4 years or more with minimum denominations of $1,000. Feb. 1, 1936, maximum rates that may be paid by nonmember insured The amount of such certificates that a bank could issue was limited to commercial banks, as established by the FDIC, have been the same as 5 per cent of its total time and savings deposits. Sales in excess of that those in effect for member banks. For previous changes, see earlier issues of the BULLETIN. MARGIN REQUIREMENTS (Per cent of market value) Period For credit extended under Regulations T (brokers and dealers), U (banks), and G (others than brokers, dealers, or banks) On margin stocks On convertible bonds Beginning Ending On short sales date date (T) 1937—Nov. 1 1945—Feb. 4 40 50 1945—Feb. 5 July 4 50 50 July 5 1946—Jan. 20 75 75 1946—Jan. 21 1947—Jan. 31 100 100 1947—Feb. 1 1949—Mar. 29 75 75 1949—Mar. 30 1951—Jan. 16 50 50 1951—Jan. 17 1953—Feb. 19 75 75 1953—Feb. 20 1955—Jan. 3 50 50 1955—Jan. 4 Apr. 22 60 60 Apr. 23 1958—Jan. 15 70 70 1958—Jan. 16 Aug. 4 50 50 Aug. 5 Oct. 15 70 70 Oct. 16 1960—July 27 90 90 1960—July 28 1962—July 9 70 70 1962—July 10 1963—Nov. 5 50 50 1963—Nov. 6 1968—Mar. 10 70 70 1968—Mar. 11 June 7 70 50 70 June 8 1970—May 5 80 60 80 1970—May 6 1971—Dec. 65 50 65 1971—Dec. 6 1972—Nov. 22 55 50 55 1972—Nov. 24 1974—Jan. 2 65 50 65 Effective Jan. 3. 1974 50 50 50 NOTE.—Regulations G, T, and U, prescribed in accordance with the Securities Exchange Act of 1934, limit the amount of credit to purchase and carry margin stocks that may be extended on securities as collateral by prescribing a maximum loan value, which is a specified percentage of the market value of the collateral at the time the credit is extended; margin requirements are the difference between the market value (100 per cent) and the maximum loan value. The term margin stocks is defined in the corresponding regulation. Regulation G and special margin requirements for bonds convertible into stocks were adopted by the Board of Governors effective Mar. 11, 1968. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • OPEN MARKET ACCOUNT A 9 TRANSACTIONS OF THE SYSTEM OPEN MARKET ACCOUNT (In millions of dollars) Outright transactions in U.S. Govt, securities, by maturity (excluding matched sale-purchase transactions) Treasury bills1 Others within 1 year2 1-5 years 5-10 years Over 10 years Period Exch., Gross Gross Redemp- Gross Gross maturity Gross Gross Exch. or Gross Gross Exch. or Gross Gross Exch. or pur- sales tions pur- sales shifts, or pur- sales maturity pur- sales maturity pur- sales maturity chases chases redemp- chases shifts chases shifts chases shifts tions 1970., 11111111111111111111111111111111,,,,,,,,,,,,,,,,000000000000000077777777777777774444444444444444 555555555555555555,,,,,,,,,,,,,,,,,,222222222222222222111111111111111111444444444444444444 2222222222222222222,,,,,,,,,,,,,,,,,,,111111111111111111166666666666666666660000000000000000000 99999999999999 -------3333333,,,,,,,444444488888883333333 888888844444448888888 5555555,,,,,,,444444433333330000000 222222244444449999999 ------111111,,,,,,888888444444555555 99999993333333 ------111111000000222222 1971., 8888888888888888,,,,,,,,,,,,,,,,888888888888888899999999999999996666666666666666 333333333333333333,,,,,,,,,,,,,,,,,,666666666666666666444444444444444444222222222222222222 1111111111111111111,,,,,,,,,,,,,,,,,,,000000000000000000066666666666666666664444444444444444444 1111111,,,,,,,000000033333336666666 -------6666666,,,,,,,444444466666662222222 1111111,,,,,,,333333333333338888888 4444444,,,,,,,666666677777772222222 999999933333333333333 666666888888555555 333333311111111111111 111111555555000000 1972., 8888888888888888,,,,,,,,,,,,,,,,555555555555555522222222222222222222222222222222 666666666666666666,,,,,,,,,,,,,,,,,,444444444444444444666666666666666666777777777777777777 2222222222222222222,,,,,,,,,,,,,,,,,,,555555555555555555544444444444444444445555555555555555555 111111122222225555555 2222222,,,,,,,999999933333333333333 777777788888889999999 -------1111111,,,,,,,444444400000005555555 555555533333339999999 ------222222,,,,,,000000999999444444 111111166666667777777 222222555555000000 1973. 11111111111111115555555555555555,,,,,,,,,,,,,,,,555555555555555511111111111111117777777777777777 444444444444444444,,,,,,,,,,,,,,,,,,888888888888888888888888888888888888000000000000000000 3333333333333333333,,,,,,,,,,,,,,,,,,,444444444444444444400000000000000000005555555555555555555 1111111,,,,,,,333333399999996666666 -------111111144444440000000 555555577777779999999 -------2222222,,,,,,,000000022222228888888 555555500000000000000 888888999999555555 111111122222229999999 888888777777 1974. 11111111111111111111111111111111,,,,,,,,,,,,,,,,666666666666666666666666666666660000000000000000 555555555555555555,,,,,,,,,,,,,,,,,,888888888888888888333333333333333333000000000000000000 4444444444444444444,,,,,,,,,,,,,,,,,,,555555555555555555555555555555555555550000000000000000000 444444455555550000000 -------1111111,,,,,,,333333311111114444444 777777799999997777777 -------666666699999997777777 444444433333334444444 111111,,,,,,666666777777555555 111111199999996666666 222222000000555555 1974—Sept.. 777777777777777711111111111111117777777777777777 555555555555555555666666666666666666555555555555555555 777777777777777777788888888888888888886666666666666666666 22222222222222 -------222222200000000000000 66666665555555 222222200000000000000 55555553333333 33333337777777 Oct... 555555555555555544444444444444447777777777777777 111111111111111111,,,,,,,,,,,,,,,,,,111111111111111111111111111111111111000000000000000000 1111111111111111111,,,,,,,,,,,,,,,,,,,000000000000000000066666666666666666663333333333333333333 Nov.. 1111111111111111................444444444444444422222222222222222222222222222222 222222222222222222777777777777777777333333333333333333 111111111111111111100000000000000000007777777777777777777 111144448888 ---111,,,666222333 99999992222222 111,,,777555777 77777778888888 --446655 22222225555555 220000 Dec.. 999999999999999977777777777777773333333333333333 444444444444444444222222222222222222666666666666666666 6666666666666666666 88885555 111222666 111111122222223333333 ---111222666 55555553333333 22222220000000 1975—Jan... 333333333333333344444444444444441111111111111111 999999999999999999444444444444444444555555555555555555 666666666666666666600000000000000000000000000000000000000 11114444 333333300000005555555 66666661111111 22222226666666 Feb.. 333333333333333355555555555555557777777777777777 444444444444444444666666666666666666000000000000000000 999999999999999999900000000000000000000000000000000000000 222,,,444333777 111111122222229999999 ---222,,,888333666 111111111111113333333 224499 77777774444444 115500 Mar.. 777777777777777766666666666666660000000000000000 111111111111111111555555555555555555666666666666666666 444444444444444444488888888888888888887777777777777777777 11111,,,,,555557777799999 ---111 ,,,444999444 333333366666661111111 111999444 444444455555550000000 222222211111112222222 Apr.. 2222222222222222,,,,,,,,,,,,,,,,111111111111111111111111111111119999999999999999 333333333333333333111111111111111111888888888888888888 555555555555555555500000000000000000006666666666666666666 111114444488888 444444488888885555555 222222277777774444444 111111166666664444444 May. 999999999999999900000000000000003333333333333333 333333333333333333555555555555555555444444444444444444 444444444444444444400000000000000000007777777777777777777 5555500000 ———333,,,iiiiiiiii 666,,,666333555 --33,,880011 229988 June. 444444444444444422222222222222221111111111111111 111111111111111111666666666666666666111111111111111111 666666666666666666611111111111111111112222222222222222222 2222200000 666999111 448888 ---555222999 118800 110099 July.. 111111111111111111,,,,,,,,,,,,,,,,,,555555555555555555000000000000000000555555555555555555 888888888888888888800000000000000000000000000000000000000 Aug.. 333111222 222222222222222222888888888888888888222222222222222222 444444444444444444400000000000000000000000000000000000000 22,,000022 ---222,,,111444444 111555000 111 ,,,222999999 666444 --11 ,,444444 444777 330000 Sept.. 222,,,111111888 222222222222222222200000000000000000000000000000000000000 222777888 555666222 ---222777888 111333777 111222444 Matched Total outright1 s t a r l a e n - s p a u c r t c i h o a ns s e R ag e r p e u e r m ch e a n s ts e Net Federal agency obligations ac B ce a p n t k a e n r c s e s, (U.S. Govt, (U.S. Govt, change net securities) securities) in U.S. Outright Repur- Net Period Govt, chase change 3 securi- agree- Repur- Gross Gross Gross ties Gross Sales or ments, chase pur- Gross Redemp- Gross pur- pur- Gross pur- redemp- net Out- agreechases sales tions sales chases chases sales chases tions right ments 197 0 12,362 5,214 2,160 12,177 12,177 33,859 33,859 4,988 -6 4,982 197 1 12,515 3,642 2,019 16,205 16,205 44,741 43,519 8,076 485 101 22 181 8,866 197 2 10,142 6,467 2,862 23,319 23,319 31,103 32,228 -312 1,197 370 -88 -9 -145 272 197 3 18,121 4,880 4,592 45,780 45,780 74,755 74,795 8,610 865 239 29 -2 -36 9,227 197 4 13,537 5,830 4,682 64,229 62,801 71,333 70,947 1,984 3,087 322 469 511 420 6,149 1974—Sept. 893 565 786 9,420 9,782 3,551 3,551 -96 207 16 40 187 322 Oct.. 547 1,110 1,063 12,574 12,516 4,618 4,618 -1,684 -100 -185 -1,970 Nov.. 1,765 273 238 6,880 6,404 6.990 6,121 1.647 331 369 174 218 2,739 Dec.. 1,254 426 6 8,855 7,962 11,470 11,895 -498 360 142 188 201 393 1975—Jan.. . 746 945 600 9,237 10,367 9,260 8,748 844 14 -409 103 -136 387 Feb... 673 460 900 7,167 6,634 11,267 10,305 -258 376 81 246 -12 39 309 Mar.. 3,362 156 1,788 15,933 16,763 5,011 6,928 332 210 2 -347 -5 -323 -136 Apr... 3,189 318 506 12,375 12,216 12,774 8,551 6,428 2 883 24 496 7,829 May.. 953 354 407 2,996 3,044 19,489 21,952 -2,224 97 -567 55 -375 -3,207 June.. 1,217 161 450 12,914 13,026 15,219 16,810 -873 6 -255 -62 -121 -1,317 July. . 1,505 800 15,532 15,139 5,977 6,146 -2,866 2 -61 3 -2,926 Aug... 2,574 282 2,389 14,234 13,730 8,146 6,881 663 353 40 90 156 1 ,222 Sept... 2,940 200 19,931 19,835 16,664 14,857 4,451 394 1 203 14 94 5,155 1 Before Nov. 1973 BULLETIN, included matched sale-purchase trans- 3 Net change in U.S. Govt, securities, Federal agency obligations, and actions, which are now shown separately. bankers' acceptances. 2 Includes special certificates acquired when the Treasury borrows NOTE.—Sales, redemptions, and negative figures reduce System holddirectly from the Federal Reserve, as follows: June 1971, 955; Sept. 1972, ings; all other figures increase such holdings. Details may not add to 38; Aug. 1973, 351 ; Sept. 1973, 836; Nov. 1974, 131 ; Mar. 1975, 1,560; totals because of rounding. Aug. 1975, 1,989. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 10 FEDERAL RESERVE BANKS • NOVEMBER 1975 CONSOLIDATED STATEMENT OF CONDITION OF ALL FEDERAL RESERVE BANKS (In millions of dollars) Wednesday End of month Item 1975 1975 1974 Oct. 29 Oct. 22 Oct. 15 Oct. * Oct. Oct. 31 Sept. 30 Assets Gold certificate account 11,599 11,599 11,599 11,599 11,599 11,599 11,599 Special.Drawing Rights certificate account. 500 500 500 500 500 500 500 Cash 390 398 396 414 401 398 403 Loans: Member bank borrowings 98 941 481 156 615 73 283 Other Acceptances: Bought outright 739 720 698 703 704 747 698 Held under repurchase agreements. 158 144 233 300 250 Federal agency obligations: Bought outright 6,073 5,789 5,789 5,789 5,789 6,073 5,789 Held under repurchase agreements. 91 119 295 169 293 U.S. Govt, securities: Bought outright: Bills 35,740 34,827 33,479 32,857 35,367 35,747 35,422 Certificates—Special Other Notes 43,400 43,400 43,400 43,400 43,400 43,400 43,400 Bonds 5,104 5,104 5,104 5,104 5,104 5,104 5,104 Total bought outright i 84,244 i 83,331 i 81,983 81,361 i 83,871 i 84,251 1 83,926 Held under repurchase agreements. 2,958 2,394 3,008 2,933 3,072 Total U.S. Govt, securities. 87,202 85,725 81,983 81,361 86,879 87,184 86,998 Total loans and securities p 94,361 P 93,438 88,951 88,009 94,515 p 94,546 94,311 Cash items in process of collection... 6,614 7,772 10,278 7,504 8,397 5,807 6,720 Bank premises 313 311 311 307 308 313 306 Operating equipment 6 6 4 4 11 4 Other assets: Denominated in foreign currencies. 413 399 415 337 247 413 247 All other 2,941 2,947 2,738 2,687 3,202 2,702 Total assets. P 117,139 P 117,370 115,344 111,412 118,658 116,789 116,792 Liabilities F.R. notes 73,233 73,356 73,773 73,355 72,636 73,063 72,563 Deposits: Member bank reserves P 28,688 * 28,241 27,114 25,449 28,149 * 26,352 25,913 U.S. Treasury—General account. 6,124 6,074 2,703 3,691 7,637 8,517 8,075 Foreign 236 214 877 234 283 297 324 Other: All other2 594 817 642 568 824 594 616 Total deposits. P 35,642 p 35,346 31,336 29,942 36,893 p 35,760 34,928 Deferred availability cash items 4,818 5,351 7,106 5,069 5,712 4,468 5,829 Other liabilities and accrued dividends. 1,147 1,134 1,055 1,081 1,167 1,163 1,165 Total liabilities. 115,187 113,270 109,447 116,408 114,454 114,485 Capital accounts Capital paid in 916 915 916 914 914 917 914 Surplus 897 897 897 897 897 897 897 Other capital accounts. 486 371 261 154 439 521 496 Total liabilities and capital accounts. 117,139 117,370 115,344 118,658 P 116,789 116,792 Contingent liability on acceptances purchased for foreign correspondents Marketable U.S. Govt, securities held in custody for foreign and international accounts 42,730 42,443 40,965 41,257 41,672 42,399 41,360 Federal Reserve Notes—Federal Reserve Agents* Accounts F.R. notes outstanding (issued to Bank) 78,654 78,711 78,680 78,520 78,606 78,659 78,643 71,621 Collateral held against notes outstanding: Gold certificate account 11,596 11,596 11,596 11,596 11,596 11,596 11,596 2,405 Special Drawing Rights certificate account. 302 302 302 302 302 302 302 Acceptances U.S. Govt, securities 69,410 69,410 69,360 69,330 69,330 69,410 69,330 70,545 Total collateral. 81,308 81,308 81,258 81,228 81,228 81,308 81,228 72,950 1 See note 2 on p. A-2. 2 See note 6 on p. A-3. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • FEDERAL RESERVE BANKS; BANK DEBITS A 11 MATURITY DISTRIBUTION OF LOANS AND U.S. GOVERNMENT SECURITIES HELD BY FEDERAL RESERVE BANKS (In millions of dollars) Wednesday End of month Item 1975 1975 1974 Oct. 29 Oct. 22 Oct. 15 Oct. 8 Oct. 1 Oct. 31 Sept. 30 Oct. 31 Loans—Total 98 941 483 155 616 73 283 1,120 Within 15 days. .. 86 935 448 124 579 46 251 1 .059 16-90 days 12 6 35 31 37 27 32 61 91 days to 1 year.. Acceptances—Total. 897 864 698 703 937 1.047 948 218 Within 15 days. .. 264 317 179 86 336 421 353 57 16-90 days 293 216 225 320 290 294 288 141 91 days to 1 year. 340 331 294 297 311 332 307 20 U.S. Govt, securities—Total. 87,202 85.725 81 .983 81.361 86.879 87.184 86,998 79,351 Within 15 days1 7,342 6,014 5.190 3,176 6:969 6,148 5,608 5,408 16-90 days 17,427 17,723 15.855 16,406 18.053 18,235 19.533 18,255 91 days to 1 year 22,774 22,329 21.279 22,120 22,198 23,190 22,198 22.534 1-5 years 30,099 30,099 30.099 30,099 30,099 30,051 30,099 21,289 5-10 years 5,893 5,893 5.893 5,893 5.893 5,893 5,893 9,946 Over 10 years 3,667 3,667 3.667 3.667 3.667 3.667 3,667 1.919 Federal agency obligations—Total. 6,164 5.908 5.789 5.789 6.084 6.242 6,082 44,,001111 Within 15 days1 129 156 11 11 295 207 303 88 16-90 days 216 195 194 195 201 216 201 144 91 days to 1 year 657 620 618 618 623 657 613 598 1-5 years 3,282 3,141 3.088 3,073 3,073 3,282 3,073 1 .937 5-10 years 1.284 1,214 1 .296 1.310 1,310 1 .284 1,310 836 Over 10 years 596 582 582 582 582 596 582 488 1 Holdings under repurchase agreements are classified as maturing within 15 days in accordance with maximum maturity of the agreements. BANK DEBITS AND DEPOSIT TURNOVER (Seasonally adjusted annual rates) Debits to demand deposit accounts1 Turnover of demand deposits (billions of dollars) Period Leading SMSA's Total 232 Leading SMSA's Total 232 Total SMSA's 226 Total SMSA's 226 233 (excl. other 233 (excl. other SMSA's N.Y. 6 others2 N.Y.) SMSA's SMSA's N.Y. 6 others2 N.Y.) SMSA's 1974—Sept. 22,017.5 9,970.8 5.092.1 12.046.7 6,954.7 125.1 310.5 127.5 83.8 66.9 Oct., 22,348.8 10,271.1 5,084.7 12.077.6 6.993.0 127.0 316.8 127.3 84.1 67.5 Nov. 22,918.7 10,538.9 5.160.2 12.379.8 7,219.6 131.8 324.6 131.5 87.5 70.6 Dec. 22,192.4 9,931.8 5.152.7 12,260.6 7,107.9 128.0 312.8 131.8 86.6 69.3 1975—Jan.. 21,856.3 10,157.8 4,868.4 11,698.4 6.830.1 '127.3 321.8 125.9 83.4 67.3 Feb. 22,952.7 10.918.0 4.992.8 12.034.7 7,041.9 133.3 343.2 127.4 85.8 69.6 Mar. 22,1-82.9 10.241.1 4.899.9 rl 1,941 .8 r7,041.9 125.1 320.4 118.2 82.2 67.8 Apr., r22,707.5 10,810.3 4,770.6 rl 1,897.2 7,126.9 ••127.8 r330.3 '115.5 82.1 68.8 May 22,739.7 10,826.1 4.852.6 11 ,913.6 7,016.0 129.2 '333.9 121.3 83.0 68.2 June 22,504.2 10.612.2 4,755.2 11,892.0 7,136.9 124.6 328.6 115.5 80.2 66.7 July. 22,830.2 10,709.5 4,841.1 12,120.7 7,279.5 126.4 331.0 116.4 81.7 68.2 Aug. r22,268.6 10,628.8 5,125.0 r12,639.7 r7,514.6 130.4 335.0 124.4 86.2 71.3 Sept. 23,228.2 10,585.0 5.196.7 12,643.2 7,446.5 129.0 330.7 124.8 85.4 70.0 1 Excludes interbank and U.S. Govt, demand deposit accounts. NOTE.—Total SMSA's include some cities and counties not designated 2 Boston, Philadelphia, Chicago, Detroit, San Francisco-Oakland, and as SMSA's. Los Angeles-Long Beach. For back data see pp. 634-35 of the July 1972 BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 12 MONEY STOCK • NOVEMBER 1975 MEASURES OF THE MONEY STOCK (In billions of dollars) Seasonally adjusted Not seasonally adjusted Period Mx Mi Mz Mi Ms Mi M-> M% Mi M-s Composition of measures is described in the NOTE below. 1972—Dec 255.8 525.7 844.9 569.7 888.8 263.0 530.7 848.0 574.9 892.2 1973—Dec 271.5 572.2 919.6 636.0 983.4 279.1 577.3 922.8 641.3 986.8 1974—Sept 280.7 603.4 965.0 688.2 1,049.9 278.9 600.3 960.8 689.0 1,049.5 Oct 281 .6 607.6 970.7 693.8 1,056.9 281 .2 605.7 967.4 694.5 1,056.2 Nov 283.6 611 .6 976.9 697.1 1,062.4 285.1 609.7 972.8 696.8 1,059.9 Dec 284.4 613.5 981 .7 703.7 1,072.0 292.3 618.6 985.0 709.0 1,075.5 1975—Jan 281 .6 614.8 986.3 707.6 1,079.1 288.6 620.7 991 .7 712.7 1,083.6 Feb 282.4 619.1 994.4 711 .2 1,086.5 279.4 616.7 992.1 705.9 1,081.4 Mar 285.0 625.1 1,005.9 714.8 1,095.7 282.2 624.6 1,007.3 712.7 1,095.4 Apr 285.8 628.9 1,015.7 717.3 1,104.1 287.3 633.3 1,022.4 719.1 1,108.2 May 288.5 635.9 1,028.3 721 .5 1,113.9 283.7 634.1 1,028.2 718.2 1,112.3 June 293.0 646.1 1,045.3 730.1 1,129.4 291 .1 645.5 1,047.1 727.9 1,129.4 July 293.5 650.5 1,055.9 732.6 1,138.0 293.1 650.1 1,057.5 731 .4 1,138.8 Aug 294.2 653.7 1,064.2 731 .7 1,142.2 290.9 650.0 1,060.2 731 .1 1,141.3 Sept .p 294.6 656.3 1,070.7 735.4 1.149.8 292.8 652.7 1,066.0 735.4 1,148.7 NOTE.—Composition of the money stock measures is as follows: M3: Mt plus mutual savings bank deposits, savings and loan shares, and credit union shares (nonbank thrift). Mi: Averages of daily figures for (1) demand deposits of commercial Mi: Mi plus large negotiable CD's. banks other than domestic interbank and U.S. Govt., less cash items in M$: M% plus large negotiable CD's. process of collection and F.R. float; (2) foreign demand balances at F.R. For a description of the latest revisions in Mi, Mi, and M3, see "Revi- Banks; and (3) currency outside the Treasury, F.R. Banks, and vaults of sion of Money Stock Measures and Member Bank Reserves and Deposits" commercial banks. on pp. 817-27 of the Dec. 1974 BULLETIN. M2: Averages of daily figures for Mi plus savings deposits, time de- Latest monthly and weekly figures including revisions since Oct. 1974 posits open account, and time certificates other than negotiable CD's of are available from the Board's Sept. 18, 1975, H.6 release. Back data are SI 00,000 of large weekly reporting banks. available from the Banking Section, Division of Research and Statistics. COMPONENTS OF MONEY STOCK MEASURES AND RELATED ITEMS (In billions of dollars) Seasonally adjusted Not seasonally adjusted Commercial banks Commercial banks Time and savings Non- Demand deposits Time and savings Non- U.S. Period ddeeppoossiittss bank ddeeppoossiittss bank Govt. Cur- De- thrift Cur- thrift deren- mand insti- ren- insti- posccyy de- tu- cy Do- tu- its3 pos- tions2 mes- tions2 its CD's1 Other Total Total Mem- tic CD's1 Other Total ber nonmember 1972—Dec 56.9 198.9 43.9 269.9 313.8 319.1 57.9 205.1 152.4 51.4 44.2 267.6 311.8 317.3 7.4 1973—Dec 61.6 209.9 63.8 300.7 364.5 347.4 62.7 216.4 157.0 56.6 64.0 298.2 362.2 345.6 6.3 1974—Sept 65.9 214.8 84.8 322.7 407.5 361 .7 65.8 213.1 153.3 56.6 88.7 321.3 410.1 360.5 5.5 Oct 66.5 215.2 86.2 325.9 412.1 363.2 66.4 214.7 154.4 57.1 88.8 324.6 413.3 361 .7 3.7 Nov 67.4 216.2 85.5 328.0 413.5 365.3 67.9 217.3 156.0 57.7 87.1 324.6 411 .7 363.0 3.4 Dec 67.9 216.5 90.3 329.1 419.3 368.2 69.0 223.3 160.4 58.9 90.5 326.3 416.7 366.5 4.9 1975—Jan 68.2 213.4 92.7 333.2 426.0 371.5 67.8 220.9 158.8 58.5 91 .9 332.1 424.0 371 .0 4.0 Feb 68.7 213.7 92.1 336.7 428.8 375.3 67.8 211 .6 152.3 56.1 89.2 337.3 426.5 375.4 3.3 Mar 69.4 215.6 89.8 340.1 429.9 380.8 68.8 213.4 153.9 56.2 88.1 342.4 430.5 382.7 3.8 Apr 69.5 216.3 88.4 343.1 431 .5 386.8 69.1 218.2 157.5 57.7 85.8 345.9 431 .8 389.1 4.0 May 70.2 218.3 85.5 347.4 432.9 392.4 70.0 213.7 154.0 56.9 84.1 350.4 434.5 394.1 4.1 June 71 .1 221.9 84.1 353.1 437.1 399.2 71 .2 219.9 157.7 59.2 82.3 354.4 436.7 401 .5 4.1 July 71 .4 222.1 82.1 357.0 439.1 405.4 71 .9 221 .1 158.3 59.8 81.3 357.0 438.3 407.4 3.3 Aug 71.9 222.3 78.0 359.4 437.4 410.5 72.2 218.7 156.3 59.5 81 .1 359.1 440.2 410.2 2.6 Sept.f 72.0 222.7 79.1 361.7 440.7 414.4 71.9 220.9 157.5 60.3 82.7 359.9 442.6 413.3 3.8 1 Negotiable time certificates of deposit issued in denominations of 3 At all commercial banks. $100,000 or more by large weekly reporting commercial banks. 2 Average of the beginning and end-of-month figures for deposits of See also NOTE above, mutual savings banks, for savings capital at savings and loan associations, and for credit union shares. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • BANK RESERVES; BANK CREDIT A 13 AGGREGATE RESERVES AND MEMBER BANK DEPOSITS (In billions of dollars) Member bank reserves, S.A.1 Deposits subject to reserve requirements3 TToottaall mmeemmbbeerr bbaannkk ddeeppoossiittss pplluuss nnoonnddeeppoossiitt S.A. N.S.A. iitteemmss44 PPPPeeeerrrriiiioooodddd NNNooonnn--- TTToootttaaalll bbbooorrr--- RRReee--- AAAvvvaaaiiilll--- Demand Demand rrrooowwweeeddd qqquuuiiirrreeeddd aaabbbllleee222 TTiimmee TTiimmee TToottaall aanndd TToottaall aanndd SS..AA.. NN..SS..AA.. ssaavviinnggss Private U.S. ssaavviinnggss Private U.S. Govt. Govt. 1971—Dec 31.33 31.20 31.15 29.03 360.3 210.7 143.8 5.8 364.6 209.7 149.2 5.7 365.2 369.5 1972—Dec 31.46 30.41 31.17 29.09 402.0 242.0 154.5 5.6 406.8 240.7 160.1 6.1 406.4 411 .2 1973—Dec 35.16 33.87 34.86 32.97 442.2 280.0 158.2 3.9 447.5 278.5 164.0 5.0 448.7 454.0 1974—Sept.. .. 37.28 34.00 37.08 35.30 480.6 314.4 159.9 6.3 479.7 317.2 158.3 4.2 489.2 488.2 Oct 36.85 35.04 36.73 34.89 480.5 317.2 159.5 3.7 480.5 318.6 159.1 2.7 488.3 488.3 Nov.... 36.88 35.62 36.67 34.87 483.6 318.4 160.6 4.6 481 .2 317.4 161.4 2.4 491 .2 488.8 Dec 36.91 36.18 36.65 34.64 485.9 323.4 160.7 1 .9 491 .8 321 .7 166.6 3.5 494.3 500.1 1975—Jan 36.91 36.51 36.76 34.41 488.2 328.5 159.0 0.7 495.1 327.2 165.0 2.9 495.8 502.6 Feb 35.46 35.32 35.27 33.61 489.2 328.9 159.7 0.6 487.0 326.5 158.0 2.4 495.7 493.5 Mar... . 34.85 34.74 34.65 33.03 491 .6 329.2 161 .7 0.7 491 .6 328.9 159.8 2.8 498.1 498.1 Apr 35.08 34.97 34.93 33.11 493.5 329.7 161.7 2. 1 495.4 329.1 163.2 3.1 500.2 502.2 May.. . . 34.63 34.56 34.47 32.80 493.7 329.0 162.6 2.1 491.8 329.8 159.0 3.0 501.2 499.2 June.. .. 34.87 34.65 34.67 33.00 500.5 330.8 165.9 3.8 497.5 330.2 164.2 3.1 507.5 504.5 July.... 34.99 34.69 34.80 32.94 498.5 330.8 165.2 2.5 497.2 330.2 164.5 2.5 505.3 504.0 Aug.. .. 34.57 34.36 34.37 32.77 496.0 327.9 165.3 2.9 494.8 330.5 162.3 2.0 503.0 501.8 Sept 34.68 34.28 34.49 32.79 498.8 330.1 165.6 3.1 499.1 332.2 164.2 2.9 505.8 506. 1 1 Averages of daily figures. Member bank reserve series reflects actual by Regulation D. Private demand deposits include all demand deposits reserve requirement percentages with no adjustment to eliminate the except those due to the U.S. Govt,, less cash items in process of collection effect of changes in Regulations D and M. Required reserves were in- and demand balances due from domestic commercial banks. creased by $660 million effective Apr. 16, 1969, and $400 million effective 4 "Total member bank deposits" subject to reserve requirements, plus Oct. 16, 1969; were reduced by $500 million (net) effective Oct. 1, 1970. Euro-dollar borrowings, loans sold to bank-related institutions, and Required reserves were reduced by approximately $2.5 billion, effective certain other nondeposit items. This series for deposits is referred to as Nov. 9, 1972; by $1.0 billion, effective Nov. 15; and increased by $300 "the adjusted bank credit proxy." million effective Nov. 22. NOTE.— For description of revised series and for back data, see article 2 Reserves available to support private nonbank deposits are defined "Revision of Money Stock Measures and Member Bank Reserves and as (1) required reserves for (a) private demand deposits, (b) total time Deposits" on pp. 817-27 of the Dec. 1974 BULLETIN. and savings deposits, and (c) nondeposit sources subject to reserve re- Due to changes in Regulations M and D, member bank reserves include quirements, and (2) excess reserves. This series excludes required reserves reserves held against nondeposit funds beginning Oct. 16, 1969. Back data for net interbank and U.S. Govt, demand deposits. may be obtained from the Banking Section, Division of Research and 3 Averages of daily figures. Deposits subject to reserve requirements Statistics, Board of Governors of the Federal Reserve Svstem, Washington, include total time and savings deposits and net demand deposits as defined D.C, 20551. LOANS AND INVESTMENTS AT ALL COMMERCIAL BANKS (In billions of dollars) Seasonally adjusted Not seasonally adjusted Loans Securities Loans Securities TTToootttaaalll TTToootttaaalll DDDDaaaatttteeee llloooaaannnsss Commercial llloooaaannnsss Commercial aaannnddd and industrial3 aaannnddd and industrial3 iiinnnvvveeesssttt--- PPlluuss UU..SS.. iiinnnvvveeesssttt--- PPlluuss UU..SS.. mmmeeennntttsss111 TToottaall ii ll ss oo oo aa ll nn dd ss 22 Total l P o l a u n s s TTrr uu ee rr aa yy ss -- OOtthheerr44 mmmeeennntttsss 111 TToottaall ii ss lloo ooll aa dd nn 22 ss Total l P o l a u n s s TTrr uu ee rr aa yy ss -- OOtthheerr44 sold 2 sold2 1971—Dec. 31 484.8 320.3 323.1 115.9 117.5 60.1 104.4 497.9 328.3 331.1 118.5 120.2 64.9 104.7 1972—Dec. 31 556.4 377.8 380.4 129.7 131.4 61.9 116.7 571.4 387.3 389.9 132.7 134.4 67.0 117.1 1973—Dec. 31 630.3 447.3 451.6 155.8 158.4 52.8 130.2 647.3 458.5 462.8 159.4 162.0 58.3 130.6 1974—Oct. 305.... 690.8 502.0 507.2 183.2 186.0 49.8 139.0 689.5 500.7 505.9 182.0 184.8 50.7 138.1 Nov. 276.... 692.5 503.8 508.7 184.3 187.0 49.1 139.6 692.2 502.0 506.9 183.2 185.9 52.1 138.1 Dec. 31 687.1 498.2 503.0 182.6 185.3 48.8 140.1 705.6 510.7 515.5 186.8 189.6 54.5 140.5 1975—Jan. 29 690.0 501.3 505.9 184.1 186.8 48.7 140.0 689.1 496.5 501. 1 181.9 184.6 53.5 139.1 Feb. 26 692.6 498.9 503.4 182.5 185.2 53.2 140.5 686.8 492.8 497.3 180.7 183.4 54.6 139.5 Mar. 26 697.0 498.3 503.0 180.9 183.7 58.5 140.2 692.5 492.3 496.9 180.5 183.3 59.3 140.9 Apr. 30 699.1 495.0 499.6 180.5 183.2 64.0 140.1 698. 1 493.1 497.7 181.1 183.8 63.3 141.7 May 28 702.0 492.8 497.5 179.1 181.9 68.2 141.0 698.3 491.6 496.3 178.7 181.5 65.0 141.7 June 30 705.0 489.9 494.6 176.3 179.2 72.4 142.7 709.3 497.2 501.9 179.0 181.9 68.2 143.9 July 30*.... 706.4 *489.6 494. 1 177.6 180.4 73.4 143.4 704.9 491.7 496.2 177.5 180.3 69.6 143.6 Aug. 27*... . 710.4 490.7 495.2 177.5 180.3 75.6 144.1 705.6 489.7 494.2 176.0 178.8 72.1 143.8 Sept. 24*... . 711.6 490.4 494.9 176.4 179.2 77.1 144. 1 711.5 491.7 496.2 176.8 179.6 75.4 144.3 Oct. 29P... . 715.0 494.1 498.8 177.9 180.8 75. 1 145.8 713.3 492.4 497.1 176.6 179.5 76.1 144.8 1 Adjusted to exclude domestic commercial interbank loans. 6 As of Oct. 31, 1974, "Total loans and investments" of all commercial 2 Loans sold are those sold outright for banks' own foreign branches, banks were reduced by $1.5 billion in connection with the liquidation nonconsolidated nonbank affiliates of the bank, the banks' holding of one large bank. Reductions in other items were: "Total loans," $1.0 company (if not a bank), and nonconsolidated nonbank subsidiaries of billion (of which $0.6 billion was in "Commercial and industrial loans"), the holding company. Prior to Aug. 28, 1974, the institutions included and "Other securities," $0.5 billion. In late November "Commercial and had been defined somewhat differently, and the reporting panel of banks industrial loans" were increased by $0.1 billion as a result of loan rewas also different. On the new basis, both "Total loans" and "Com- classifications at another large bank. mercial and industrial loans" were reduced by about $100 million. 3 Reclassification of loans at one large bank reduced these loans by NOTE.—Total loans and investments: For monthly data, Jan. 1959about $400 million as of June 30, 1972. June 1973, see Nov. 1973 BULLETIN, pp. A-96-A-97, and for 1948-58, 4 Farmers Home Administration insured notes included in "Other Aug. 1968 BULLETIN, pp. A-94-A-97. For a description of the current securities" rather than in loans beginning June 30, 1971, when such notes seasonally adjusted series see the Nov. 1973 BULLETIN, pp. 831-32, and totaled about $700 million. the Dec. 1971 BULLETIN, pp. 971-73. Commercial and industrial loans: 5 Data beginning June 30, 1974, include one large mutual savings For monthly data, Jan. 1959-June 1973, see Nov. 1973 BULLETIN, pp. bank that merged with a nonmember commercial bank. As of that date A-96-A-98; for description see July 1972 BULLETIN, p. 683. Data are for there were increases of about $500 million in loans, $100 million in "Other last Wednesday of month except for June 30 and Dec. 31; data are partly Digitized fors eFcRurAitSieEs,"R a nd $600 million in "Total loans and investments." or wholly estimated except when June 30 and Dec. 31 are call dates. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 14 COMMERCIAL BANKS • NOVEMBER 1975 PRINCIPAL ASSETS AND LIABILITIES AND NUMBER, BY CLASS OF BANK (Amounts in millions of dollars) Loans and investments Total Deposits assets— Total Classification by Securities lia- Interbank3 Other Total Num- FRS membership Cash bilities Bor- capital ber and FDIC assets 3 and row- ac- of insurance Total Loans capital Total 3 Demand ings counts banks l U.S. Other ac- De- Treas- 2 counts4 mand Time Time5 ury U.S. Other Govt. Last-Wednesday-of-month series6 All commercial banks: 1941—Dec. 31.. 50,746 21,714 21,808 7,225 26,551 79,104 71,283 10,982 44,349 15,952 23 1947—Dec. 31 7. 116,284 38,057 69,221 9,006 37,502 155,377 144,103 12,792 240 1,343 94,367 35,360 65 1960—Dec. 31.. 199,509 117,642 61,003 20,864 52,150 257,552 229,843 17,079 1,799 5,945 133,379 71,641 163 1970—Dec. 318. 461,194 313,334 61,742 86,118 93,643 576,242 480,940 30,608 1,975 7,938 209,335 231,084 19,375 1971—Dec. 31.. 516,564 346,930 64,930 104,704 99,832 640,255 537,946 32,205 2,908 10,169 220,375 272,289 25,912 1972—Dec. 31.. 598, f" 414,696 67,028 117,084 113,128 739,033 616,037 33,854 4,194 10,875 252,223 314,891 38,083 1973—Dec. 31.. 683,799 494,947 58,277 130,574 118,276 835,224 681,847 36,839 6,773 9,865 263,367 365,002 58,994 1974—Oct. 309. 723,330 534,520 50,730 138,080 110,770 880,750 700,420 33,150 10,180 3,080 243,090 410,920 68,350 Nov. 27.. 729,640 539,400 52,140 138,100 116,220 894,530 708,150 34,230 10,310 3,910 248.730 410,970 71,470 Dec. 31.. 744,107 549,183 54,451 140,473 128,042 919,552 747,903 43,483 11,496 4,807 267;506 420,611 58.369 1975—Jan. 29.. 724,820 532,230 53,500 090 101,670 875,020 702,170 29,980 11,740 4,520 233,880 422,050 61,460 Feb. 26.. 725,480 531,390 54,550 540 103,880 879,080 702,500 29,930 10,440 2,630 234,610 424,890 64,290 Mar. 26.. 731,690 531,440 59,330 920 105,850 889,370 712,520 30,410 11,680 3,950 236,900 429,580 63.370 A M p a r y . 2 3 8 0 . . . . 7 7 3 3 1 3 , , 1 6 0 9 0 0 5 5 2 2 6 7 , , 1 0 2 3 0 0 6 6 5 3 , ,2 0 8 0 0 0 ;6 7 6 00 0 1 1 1 1 4 4 , , 1 4 4 0 0 0 9 8 0 9 1 9 , , 2 1 8 1 0 0 7 7 2 2 3 5 , , 0 5 6 9 0 0 3 3 3 2 , , 1 5 4 1 0 0 1111.;8 2800 0 7 2 , , 9 9 1 5 0 0 2 2 4 4 2 6 , , 5 4 8 1 0 0 4 4 2 3 7 2 , , 5 5 5 2 0 0 6 6 1 1 , , 3 7 4 0 0 0 June 30.. 747,551 535,493 68,191 868 128,716 930,719 754,324 42,582 11,209 3,117 264,027 433,389 62,420 July 30*>. 738,850 525,640 69,620 590 106,780 900,210 724,350 33,160 10,830 2,230 243,470 434,660 61,800 Aug. 27*>. 740,590 524,700 72,060 830 104,030 898,940 723,090 31,510 10,570 2,850 242,290 435,870 59,770 Sept. 24*. 742,300, 522,580 75,440 ,280 105,160 903,440 724,490 31,280 10,990 3,220 240,080 438,920 60,790 Oct. 29*>. 745,140 524,250 76,050 ,840 109,160 911,900 733,970 31,830 11 ,210 2,710 247,020 441,200 60,170 Members of F.R. System: 1941—Dec. 31 .. 43,521 18,021 19,539 5,961 23,113 68,121 61,717 10,385 140 1,709 37,136 12,347 4 1947—Dec. 31.. 97,846 32,628 57,914 7,304 32,845 132,060 122,528 12,353 50 1,176 80,609 28,340 54 I960—Dec. 31.. 165,619 99,933 49,106 16,579 45,756 216,577 193,029 16,437 1,639 5,287 112,393 57,273 130 1970—Dec. 318. 365,940 253,936 45,399 66,604 81,500 465,644 384,596 29,142 1,733 6,460 168,032 179,229 18,578 1971—Dec. 31.. 405.087 277,717 47,633 79,738 86,189 511,353 425,380 30,612 2,549 8,427 174,385 209,406 25,046 1972—Dec. 31.. 465,788 329,548 48,715 87,524 96,566 585,125 482,124 31,958 3,561 9,024 197,817 239,763 36,357 1973—Dec. 31.. 528,124 391,032 41,494 95,598 100,098 655, i 526,837 34,782 5,843 8,273 202,564 275,374 55,611 1974—Oct. 309. 548,622 415,941 34,813 97,868 93,674 680,173 535,128 31,043 9,089 2,117 184,573 308,306 60,803 Nov. 27.. 556.088 421,428 36,394 98,266 98,603 694,743 542,515 32,422 9,222 2,859 189,688 308,324 65,41' Dec. 31.. 568,532 429,537 38,921 100,073 106,995 715,615 575,563 41,062 10,052 3,183 204,203 317,064 52,850 1975—Jan. 29r. 550,220 414,419 37,549 252 86,350 676,898 536,256 28,311 10,299 3,247 177,701 316,698 56,105 Feb. 26.. 549,144 412,076 38,628 440 88,430 678,970 535,250 28,157 8,991 1,989 178,596 317,517 58,1 Mar. 26.. 552,957 411,446 42,544 967 89,685 685,906 542,076 28,564 10,231 2,794 180,214 320,273 58,030 Apr. 30.. 550,756 406,676 45,142 938 96,694 692,147 549,824 31,102 10,433 6,212 184,693 317,384 55,738 May 28.. 551,264 405,803 46,918 543 96,455 691,485 549,996 30,191 9,751 2,178 187,439 320,437 56,140 June 30.. 562,667 412,939 49,610 118 107,152 716,364 573,382 39,847 9,576 2,166 201,197 320,596 56,334 July 30.. 553,545 403,742 50,050 753 89,898 688,756 547,222 30,980 9,198 1 ,541 184,595 320,908 56,094 Aug. 27.. 554,007 402,281 51,899 827 87,208 686,266 545,021 29,335 8,932 2,099 183,283 321,372 54,175 Sept. 24.. 555,096 400.695 54,355 046 88.004 689.717 546,360 29,150 9,360 2,343 181,340 324,167 54,929 Oct. 29.. 556,379 401,489 54,546 344 91,420 695,311 552,791 29,572 9,578 1,960 186,843 324,838 54,167 Call date series | Insured banks: Total: 1941—Dec. 31... 49,290 21,259 21,046 6,984 25,788 76,820 69,411 10,654 1,762 41,298 15,699 10 6,844 13,426 1947—Dec. 31... 114,274 37,583 67,941 8,750 36,926 152,733 141,851 12,615 54 1,325 92,975 34,882 61 9,734 13,398 I960—Dec. 31... 198,011 117,092 60,468 20,451 51,836 255,669 228,401 16,921 1,667 5,932 132,533 71,348 149 20,628 13,119 1970—Dec. 318.. 458,919 312,006 61,438 85,475 92,708 572,682 479,174 30,233 1,874 7,898 208,037 231,132 19,149 42,427 13,502 1972—Dec. 31... 594,502 411,525 66,679 116,298 111,333 732,519 612,822 33,366 4,113 10,820 250,693 313,830 37,556 52,166 13,721 1973—Dec. 31... 678,113 490,527 57,961 129,625 116,266 827,081 677,358 36,248 6,429 9,856 261,530 363,294 57,531 57,603 13,964 1974—Dec. 31... 734,516 541,111 54,132 139,272 125,375 906,325 741,665 42,587 10,693 4,799 265,444 418,142 55,988 63,039 14,216 1975—Apr. 16... 733,913 529,350 59,540 145,023 110,950 893,141 720,607 31,291 10,845 4,628 249,373 424,470 65,274 64,578 14,274 June 30... 736,164 526,272 67,833 142,060 125,181 914,781 746,348 41,244 10,252 3,106 261,903 416,962 59,310 65,986 14,320 National member: 1941—Dec. 31... 27,571 11,725 12,039 3,806 14,977 43,433 39,458 6,786 1,088 23,262 8,322 4 3,640 5,117 1947—Dec. 31... 65,280 21,428 38,674 5,178 22,024 88,182 82,023 8,375 35 795 53,541 19,278 45 5,409 5,005 1960—Dec. 31... 107,546 63,694 32,712 11,140 28,675 139,261 124,911 9,829 611 3,265 71,660 39,546 111 11,098 4,530 1970—Dec. 318.. 271,760 187,554 34,203 50,004 56,028 340,764 283,663 18,051 982 4,740 122,298 137,592 13,100 24,868 4,620 1972—Dec. 31... 350,743 247,041 37,185 66,516 67,390 434,810 359,319 19,096 2,155 6,646 146,800 184,622 26,706 30,342 4,612 1973—Dec. 31... 398,236 293,555 30,962 73,718 70,711 489,470 395,767 20,357 3,876 5,955 152,705 212,874 39,696 33,125 4,659 1974—Dec. 31... 428,433 321,466 29,075 77,892 76,523 534,207 431,039 23,497 6,750 2,437 154,397 243,959 39,603 35,815 4,706 1975—Apr. 16... 425,928 312,844 32,503 80,581 66,841 523,006 416,620 17,146 7,157 2,809 144,014 245,494 44,405 36,652 4,720 June 30... 428,167 312,229 37,606 78,331 75,686 536,836 431,646 21,096 6,804 1,723 152,576 242,492 41,954 37,483 4,730 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • COMMERCIAL BANKS A 15 PRINCIPAL ASSETS AND LIABILITIES AND NUMBER, BY CLASS OF BANK—Continued (Amounts in millions of dollars) Loans and investments Deposits Total assets— CCllaassssiiffiiccaattiioonn bbyy Securities Total Interbank 3 Other TToottaall Num- FFRRSS mmeemmbbeerrsshhiipp Cash lia- Bor- ccaappiittaall ber aanndd FFDDIICC assets 3 bilities row- aacc-- of iinnssuurraannccee Total Loans U.S. and Total3 Demand ings ccoouunnttss banks l Treas- Other capital De- Time ury 2 ac- mand Time 5 counts4 U.S. Other Govt. Call date series Insured banks (cont.): State member: 1941—Dec. 31... 15,950 6,295 7,500 2,155 8,145 24,688 22,259 3,739 621 13,874 4,025 2,246 1,502 1947—Dec. 31... 32,566 11,200 19,240 2,125 10,822 43,879 40,505 3,978 15 381 27,068 9,062 9 3,055 1,918 1960—Dec. 31... 58,073 36,240 16,394 5,439 17,081 77,316 68,118 6,608 1,028 2,022 40.733 17,727 20 6,299 1,644 1970—Dec. 318.. 94,760 66,963 11,196 16,600 25.472 125,460 101,512 11,091 750 1,720 45.734 42,218 5,478 9,232 1,147 1972—Dec. 31... 115,426 82,1 11,530 21,008 29,176 150,697 123,186 12,862 1,406 2,378 51,017 55,523 9,651 10,886 1,092 1973—Dec. 31... 130,240 97,828 10,532 21,880 29,387 166,780 131.421 14,425 1,968 2,318 49,859 62,851 15,914 11,617 1,076 1974—Dec. 31... 140,373 108,346 9,846 22,181 30.473 181,683 144,799 17,565 3,301 746 49,807 73,380 13,247 12,425 1 ,074 1975—Apr. 16... 136,425 102,992 10,127 23,306 29,358 177,453 135,949 12,984 3,047 735 46,287 72,895 17,988 12,586 1,066 1975—June 30.. 134.759 100.968 12.004 21,787 31,466 179,787 141,995 18.751 2,771 443 48,621 65.654 14,380 12,773 1 ,064 Nonmember: 1941—Dec. 31... 5,776 3,241 1,509 1,025 2,668 8,708 7,702 129 53 4,162 3,360 6 959 6,810 1947—Dec. 31... 16,444 4,958 10,039 1,448 4,083 20,691 19,342 262 4 149 12,366 6,558 7 1,271 6,478 1960—Dec. 31... 32,411 17,169 11,368 3,874 6,082 39,114 35,391 484 27 645 20,140 14,095 19 3,232 6,948 1970—Dec. 318.. 92,399 57,489 16,039 18,871 11,208 106,457 93,998 1,091 141 1,438 40,005 51,322 571 8,326 7,735 1972—Dec. 31... 128,333 81,594 17,964 28,774 14,767 147,013 130,316 1,408 552 1,796 52,876 73,685 1,199 10,938 8,017 1973—Dec. 31... 149,638 99,143 16,467 34,027 16,167 170,831 150,170 1,467 586 1,582 58,966 87,569 1,920 12,862 8,229 1974—Dec. 31... 165,709 111,300 15,211 39,199 18,380 190,435 165,827 1 ,525 642 1 ,616 61,240 100,804 3,138 14,799 8,436 1975—Apr. 16... 171,559 113,513 16,909 41,136 14,750 192,682 168,039 1,161 641 1,084 59,071 106,082 2,881 15,339 8,488 1975—June 30.. 173,238 113.074 18.223 41,942 18,029 198.157 172.707 1,397 676 940 60.706 108,816 2,976 15.730 8,526 Noninsured nonmember: 1941—Dec. 31... 1,457 455 761 241 763 2,283 1,872 329 1,291 253 13 329 852 1947—Dec. 317.. 2,009 474 1,280 255 576 2,643 2,251 177 185 18 1' ,392 478 4 325 783 1960—Dec. 31... 1,498 550 535 413 314 1,883 1,443 159 132 13 846 293 14 358 352 1970—Dec. 318.. 3,079 2,132 304 642 934 4,365 2,570 375 101 40 1,298 756 226 532 184 1971—Dec. 31... 3,147 2,224 239 684 1,551 5,130 2,923 380 116 19 1,273 1,134 283 480 181 1972—Dec. 31... 4,865 3,731 349 785 1,794 7,073 3,775 488 81 55 1,530 1,620 527 491 206 1973—Dec. 31... 6,192 4,927 316 949 2,010 8,650 4,996 591 344 9 1,836 2,215 1,463 524 207 1974—Dec. 31... 9,981 8,461 319 1 ,201 2,667 13,616 6,627 897 803 2,062 2,857 2.382 611 249 1975—June 30.. 11,725 9,559 358 1,808 3,534 16.277 8,314 1.338 2,124 3,320 3,110 570 Total nonmember: 1941—Dec. 31... 7,233 3,696 2,270 1,266 3,431 10,992 9.573 457 5,504 3,613 18 1,288 7,662 1947—Dec. 31... 18,454 5,432 11,318 1,703 4,659 23,334 21,591 439 190 16"7 13,758 7,036 12 1,596 7,261 1960—Dec. 31... 33,910 17,719 11,904 4,287 6,396 40,997 36,834 643 160 657 20,986 14,388 33 3,590 7,300 1970—Dec. 318.. 95,478 59,621 16,342 19,514 12,143 110,822 96,568 1,466 243 1,478 41,303 52,078 796 8,858 7,919 1971—Dec. 31... 11,674 69,411 17,297 24,966 13,643 129,100 112,764 1,592 359 1,742 45,990 63,081 866 9,932 8,056 1972—Dec. 31... 133,198 85,325 18,313 29,559 16.562 154,085 134,091 1,895 633 1,850 54,406 75,305 1,726 11,429 8,223 1973—Dec. 31... 155,830 104,070 16,783 34.976 18,177 179,480 155,165 2,057 930 1,592 60,802 89,784 3.383 13,386 8,436 1974—Dec. 31... 175,690 119,761 15,530 40,400 21,047 204,051 172,454 2,422 1,445 1,624 63,302 103,661 5,520 15,410 8,685 1975—June 30.. 184,963 122,633 18.581 43,750 21.563 214,434 181.021 2,735 1,633 951 62,830 112,136 6,086 16,300 8,779 1 Loans to farmers directly guaranteed by CCC were reclassified as 9 Member bank data for Oct. exclude assets of $3.6 billion of one large securities and Export-Import Bank portfolio fund participations were bank. reclassified from loans to securities effective June 30, 1966. This reduced "Total loans" and increased "Other securities" by about $1 billion. NOTE.—Data are for all commercial banks in the United States (includ- "Total loans" include Federal funds sold, and beginning with June 1967 ing Alaska and Hawaii, beginning with 1959). Commercial banks represent securities purchased under resale agreements, figures for which are in- all commercial banks, both member and nonmember; stock savings cluded in "Federal funds sold, etc.," on p. A-16. banks; and nondeposit trust companies. Effective June 30, 1971, Farmers Home Administration notes were Figures for member banks before 1970 include mutual savings banks classified as "Other securities" rather than "Loans." As a result of this as follows: 3 before Jan. 1960 and 2 through Dec. 1960. Those banks change, approximately $300 million was transferred to "Other securities" are not included in insured commercial banks. for the period ending June 30, 1971, for all commercial banks. Effective June 30, 1969, commercial banks and member banks exclude See also table (and notes) at the bottom of p. A-24. a small national bank in the Virgin Islands; also, member banks exclude, 2 See first 2 paragraphs of note 1. and noninsured commercial banks include, through June 30, 1970, a small 3 Reciprocal balances excluded beginning with 1942. member bank engaged exclusively in trust business; beginning 1973, 4 Includes items not shown separately. See also note 1. exclude 1 national bank in Puerto Rico. 5 See third paragraph of note 1 above. Beginning Dec. 31, 1973, June 30, 1974, and Dec. 31, 1974, June 30, 6 For the last-Wednesday-of-the-month series, figures for call dates 1975, respectively, member banks exclude and noninsured nonmember are shown for June and December as soon as they became available. banks include 1, 2, 3, and 4 noninsured trust companies that are member 7 Beginning with Dec. 31, 1947, the series was revised; for description, of the Federal Reserve System. see note 4, p. 587, May 1964 BULLETIN. Comparability of figures for classes of banks is affected somewhat by 8 Figure takes into account the following changes, which became changes in F.R. membership, deposit insurance status, and by mergers effective June 30, 1969: (1) inclusion of consolidated reports (including etc. figures for all bank-premises subsidiaries and other significant majority- Figures are partly estimated except on call dates. owned domestic subsidiaries) and (2) reporting of figures for total loans For revisions in series before June 30, 1947, see July 1947 BULLETIN, and for individual categories of securities on a gross basis—that is, before pp. 870-71. deduction of valuation reserves—rather than net as previously reported. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 16 COMMERCIAL BANKS • NOVEMBER 1975 ASSETS BY CLASS OF BANK, JUNE 30, 1975 (Amounts in millions of dollars) Member banks1 AAllll IInnssuurreedd Large banks AAccccoouunntt ccoommmmeerrcciiaall ccoommmmeerrcciiaall NNoonn-bbaannkkss bbaannkkss mmeemmbbeerr TToottaall New City of Other AAllll ootthheerr bbaannkkss11 York Chicago large City Cash bank balances, items in process 128.716 125.181 107.152 29.694 4.419 38.925 34.114 21,564 Currency and coin 10,102 10,079 7,546 569 121 2,520 4.335 2.556 Reserves with F.R. Banks 26,890 26.890 26,890 5.656 1 .800 10,084 9.350 Demand balances with banks in United States 34,278 31.788 19,722 6.940 165 3,710 8.906 14,556 Other balances with banks in United States 5,727 5.276 3,647 94 115 1,153 2.284 2.080 Balances with banks in foreign countries 2,296 1 .833 1.738 438 78 938 285 558 Cash items in process of collection 49,422 49,315 47,610 15,997 2,139 20,518 8.955 1 .813 Total securities held—Book value 212,058 209,893 149,728 16.808 5,879 49,992 77,049 62,330 U.S. Treasury 68.191 67.833 49.610 7.368 2.189 17,061 22,992 18.581 Other U.S. Govt, agencies 33,882 33.490 21,213 1,754 570 6,348 12,540 12,669 States and political subdivisions 101.472 101.091 73,762 7.030 2.828 25,087 38,817 27,711 All other securities 8.513 7.479 5.144 657 291 1 ,496 2.699 3.370 Trade-account securities 6.198 6,188 6. 136 2.468 556 2,896 217 62 U.S. Treasury 2.945 2,934 2.909 1 .399 344 1,078 88 35 Other U.S. Govt, agencies 941 941 934 239 27 633 35 7 States and political subdivisions 1 .907 1.907 1 .893 736 117 952 89 14 All other 406 406 400 95 68 233 5 6 Bank investment portfolios 205.860 203,705 143.592 14,340 5,323 47,096 76.832 62,268 U.S. Treasury 65,246 64,899 46,701 5.969 1.845 15,983 22,904 18,545 Other U.S. Govt, agencies 32.941 32.549 20.279 1.515 544 5,715 12,505 12,662 States and political subdivisions 99.566 99.184 71.869 6.294 2.711 24,135 38.729 27,697 All other 8. 108 7.073 4.743 562 224 1,264 2,694 3.364 Federal funds sold and securities resale agreements... 38.841 37.383 28,951 1 .747 1,263 14,807 1 1,133 9.891 Commercial banks 34.083 32.625 24,296 852 1.041 11,800 10.604 9.787 Brokers and dealers 3,054 3.054 2.977 108 203 2,195 471 77 Others 1.704 1.704 1,677 787 19 812 59 27 Other loans 496,990 488,888 384,247 75.339 22.512 142,424 143.973 112,742 Real estate loans 131,445 131.246 94,442 7.951 1.332 35,526 49.633 37,003 Secured by farmland 6.105 6,090 2,676 5 2 327 2.342 3,428 Secured by residential 8 1360 81.233 59,898 4.265 894 23,532 31.207 21,462 1- to 4-family residences 74,612 74,489 54,377 3,150 839 20,932 29,456 20,235 FHA insured 5.626 5,610 4,875 233 55 2.632 1,955 752 VA guaranteed 3. 167 3.147 2,713 181 20 1,418 1,094 454 Other 65,818 65.732 46,790 2,736 764 16,882 26.407 19,029 Multifamily 6,748 6,744 5.521 1. 115 55 2,600 1,751 1 ,227 FHA insured 762 761 706 136 25 331 214 56 Other 5.986 5.983 4.815 978 30 2,269 1,537 1 .171 Secured by other properties 43,981 43.923 31,868 3,681 436 11,667 16.084 12,113 Loans to domestic and foreign banks 11.155 8,644 8,075 3.543 504 3,252 776 3,080 Loans to other financial institutions 32:413 32.164 30,964 11,756 4,720 12,175 2,314 1,449 Loans on securities to brokers and dealers 5,534 5.447 5,373 3,931 659 649 134 161 Other loans for purch./carry securities 3.836 3.818 3,177 516 277 1,497 887 658 Loans to farmers 19.071 19.054 10.768 88 190 2,554 7.935 8,304 Commercial and industrial loans 178.993 174,436 147,242 39,616 12,517 55,802 39.307 31,751 Loans to individuals 101,816 101,512 72,806 4,942 1,5 40 25,865 40.458 29,010 Instalment loans 79.246 79,033 56,275 3.062 804 20,229 32,180 22,971 Passenger automobilies 32,128 32.026 21,423 421 151 6,621 14,230 10,706 Residential-repair/modernize 5.627 5,611 4,077 202 49 1,717 2,109 1,550 Credit cards and related plans 10.835 10.835 9.551 1.015 399 5,320 2,818 1 ,284 Charge-account credit cards 8,240 8.240 7.389 742 369 4,181 2,096 851 Check and revolving credit plans 2.595 2.594 2,162 273 29 1,139 722 433 Other retail consumer goods 15,273 15.242 10,661 160 104 3,765 6.632 4,611 Mobile homes 8,807 8.801 6,340 100 48 2,276 3.916 2,467 Other 6,466 6,441 4,321 60 56 1,489 2,116 2,144 Other instalment loans 15,383 15,318 10,563 1.265 101 2,807 6,390 4,820 Single-payment loans to individuals 22,570 22,479 16,531 1 ;880 736 5,636 8.278 6,039 All other loans 12.726 12,568 11,400 2,995 773 5,103 2,529 1 ,326 Total loans and securities 747.889 736,164 562,926 93,894 29,654 207,223 232,155 184,963 Fixed assets—Buildings, furniture, real estate 16,254 16,175 12,183 1.263 500 4,894 5,526 4.071 Investments in subsidiaries not consolidated 1,820 1,798 1,777 797 146 754 81 42 Customer acceptances outstanding 9,462 9,223 8,993 4,795 427 3,438 332 469 Other assets 26.917 26,239 23,592 8,889 1,122 9,756 3.825 3,325 Total assets 931,057 914,781 716,623 139,333 36,268 264,990 276,032 214,434 Number of banks 14.573 14,320 5,794 12 9 155 5,618 8,779 1 Member banks exclude and nonmember banks include 4 noninsured NOTE.—Data include consolidated reports, including figures for all trust companies that are members of the Federal Reserve System, and bank-premises subsidiaries and other significant majority-owned domestic member banks exclude 2 national banks outside the continental United subsidiaries. Figures for total loans and for individual categories of States. securities are reported on a gross basis—that is, before deduction of 2 See table (and notes), Deposits Accumulated for Payment of Personal valuation reserves. Loans, p. 24. Back data in lesser detail were shown in previous BULLETINS. Beginning 3 Demand deposits adjusted are demand deposits other than domestic with the fall Call Report, data for future spring and fall Call Reports will commercial interbank and U.S. Govt., less cash items reported as in be available from the Data Production Section of the Division of Data process of collection. Processing. Details may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • COMMERCIAL BANKS A 17 LIABILITIES AND CAPITAL BY CLASS OF BANK, DECEMBER 31, 1974 (Amounts in millions of dollars) Member banks1 All Insured Large banks Non- Account commercial commercial member banks banks Total All other banks1 New City of Other York Chicago large City Demand deposits 309,726 306,253 243,210 57,475 9,911 85.372 90,453 66.516 Mutual savings banks 1,279 1,151 1,057 483 1 210 362 223 Other individuals, partnerships, and corporations.. 232,079 231,121 177,344 29,687 7.668 65.847 74.142 54,735 U.S. Government 3,117 3,106 2,166 118 42 725 1,280 951 States and political subdivisions 18,217 18,079 13,074 758 186 3,883 8,247 5.143 Foreign governments, central banks, etc 1,555 1,310 1,280 1,088 18 167 6 275 Commercial banks in United States 34,345 34,019 32,823 16,986 1,593 10.482 3,762 1 ,522 Banks in foreign countries 6,957 6,074 5,967 4,662 152 1,058 95 990 Certified and officers' checks, etc 12,176 11,393 9,499 3,691 250 2,999 2,558 2,677 Time and savings deposits 444,936 440,096 330,431 46,693 16,362 119,708 147,669 114,505 Savings deposits 151,744 151,463 109,037 66,,999955 22,,338855 38,455 61;202 42,708 Accumulated for personal loan payments2 338 335 259 74 186 79 Mutual savings banks 648 627 611 287 17 265 42 37 Other individuals, partnerships, and corporations.. 219,489 216,619 163,751 25,801 10,371 59,106 68,473 55,738 U.S. Government 492 492 360 10 1 184 165 132 States and political subdivisions 48,219 48,052 34,739 1,421 1,324 15,062 16,932 - 13,480 Foreign governments, central banks, etc 13,445 12,882 12,710 7,956 1,374 3,337 43 735 Commercial banks in United States 8,449 8,334 7,716 3,205 842 3,048 621 733 Banks in foreign countries 2,111 1,291 1,248 1,018 48 178 5 863 Total deposits 754,662 746,348 573,641 104,167 26.272 205,080 238,122 181,021 Federal funds purchased and securities sold under agreements to repurchase 56,529 54,835 52,184 13,367 5,845 25,865 7.106 4,345 Other liabilities for borrowed money 5,891 4,475 4,150 1,362 26 2,370 392 1 .741 Mortgage indebtedness 763 761 550 64 4 313 169 213 Bank acceptances outstanding 10,060 9,814 9,583 5,375 430 3,447 332 477 Other liabilities 27,627 23,645 18,960 3,535 929 7,789 6.706 8,667 Total liabilities 855,533 839,879 659,069 127,870 33,507 244,864 252,827 196,464 Minority interest in consolidated subsidiaries 5 4 1 1 4 Total reserves on loans/securities 8,963 8,912 7,297 1,685 525 2,761 2,325 1,666 Reserves for bad debts (IRS) 8.659 8,614 7,110 11,,668855 525 2,682 2.218 1,549 Other reserves on loans 121 119 69 1 17 50 53 Reserves on securities 182 179 119 61 57 64 Total capital accounts 66,557 65,986 50,257 9,777 2,236 17,365 20,878 16,300 Capital notes and debentures 4,347 4,287 3,467 782 81 1,656 948 880 Equity capital 62,210 61,699 46,790 8,995 2,155 15;710 19,930 15,421 Preferred stock 50 42 24 10 13 27 Common stock 15,176 15,077 11,187 2,163 568 3,614 4,842 3,989 Surplus 25,968 25,816 19,500 3,667 1,143 6,976 7,713 6,468 Undivided profits 20,053 19.859 15,441 3,166 399 4,845 7,031 4,613 Other capital reserves 996633 990055 663388 4444 226644 333300 332244 Total liabilities, reserves, minority interest, capital accounts 931,057 914,781 716,623 139,333 36,268 264,990 276,032 214,434 Demand deposits adjusted 3 222,842 219,813 160,611 24,373 6,136 53,646 76,456 62,231 Average total deposits (past 15 days) 734,017 726,164 555,860 96,313 25,508 199,612 234,427 178,157 Average total loans (past 15 days) 506,945 497,466 385,936 74,863 22,484 143,273 145,316 121,009 Selected ratios: Percentage of total assets Cash and balances with other banks 13.8 13.7 15.0 21.3 12.2 14.7 12.4 10.1 22.8 22.9 20.9 12.1 16.2 18.9 27.9 29.1 Total securities held Trading account securities .7 .7 .9 1.8 1.5 1.1 . 1 U.S. Treasury .3 .3 .4 1.0 .9 .4 States and political subdivisions .2 .2 .3 .5 .3 .4 All other trading account securities . 1 . 1 .2 .2 .3 .3 Bank investment portfolios 22.1 22.3 20.0 10.3 14.7 17.8 27.8 29.0 U.S. Treasury 7.0 7.1 6.5 4.3 5.1 6.0 8.3 8.6 States and political subdivisions 10.7 10.8 10.0 4.5 7.5 9.1 14.0 12.9 All other portfolio securities 4.4 4.3 3.5 1.5 2.1 2.6 5.5 7.5 Other loans and Federal funds sold 57.6 57.5 57.7 55.3 65.6 59.3 56.2 57.2 All other assets 5.8 5.8 6.5 11.3 6.1 7.1 3.5 3.7 Total loans and securities 80.3 80.5 78.6 67.4 81.8 78.2 84.1 86.3 Reserves for loans and securities 1.0 1.0 1.0 1.2 1.4 1.0 .8 .8 Equity capital—Total 6.7 6.7 6.5 6.5 5.9 5.9 7.2 7.2 Total capital accounts 7.1 7.2 7.0 7.0 6.2 6.6 7.6 7.6 Number of banks 14,573 14,320 5,794 12 9 155 5,618 8,779 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 18 WEEKLY REPORTING BANKS • NOVEMBER 1975 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKS (In millions of dollars) Loans Federal funds sold, etc.1 Other To brokers For purchasing and dealers or carrying securities To nonbank Total involving— financial loans institutions Wednesday and To brokers To invest- To Com- and dealers others ments com- To mer- Agri- Total mer- U.S. Other others Total cial culcial Treas- se- and tural Pers. banks ury curi- indus- U.S. U.S. and se- ties trial Treas- Other Treas- Other sales curi- ury sees. ury sees. finan. ties sees. sees. cos., etc. Large banks— Total 1974 Oct. 2 398,212 16,938 13,834 1,300 889 915 299,353 128.827 3,771 898 3,707 101 2,629 10,217 9 401.346 19,550 14,057 3,556 836 1,101 299.397 128,529 3.754 2.500 4.007 91 2,634 9,707 16 399,288 18.515 14.723 2.059 773 960 298.201 129.032 3.739 618 3,454 92 2,629 9,992 2 3 394,150 15.493 12;541 1,240 744 968 296.913 128.323 3.751 1.324 3,370 94 2,614 9,684 30 394.981 16,243 12,929 1,820 696 798 296,631 128,328 3.759 966 3,735 94 2,613 9,883 1975 Sept. 3 390,590 16,909 14,738 1,187 477 507 279,378 118,983 3,629 696 3,463 99 2,272 9,272 10 393,730 18,722 14,964 2,546 619 593 279,356 119,007 3,624 1,118 3,490 96 2,275 9,034 17 392,257 16,674 13,041 2,356 671 606 280,042 119,243 3,635 1.602 3,605 94 2,268 9,096 2 4 388,363 14,471 12,152 1,307 392 620 278.711 119,006 3,630 763 3,216 81 2,270 9,019 Oct. 1 394.972 17,777 15,030 1,288 632 827 281,571 119,714 3.632 896 3,799 87 2,258 9,567 8 394;706 17,985 13,398 2,987 958 642 280,842 119.191 3.619 2.248 3,820 87 2,260 8,718 1 5 396,088 19,671 15,273 2,635 1,057 706 280,758 119,200 3,616 1.499 4,150 81 2,273 8,697 22 389,638 15,574 12,898 1,543 533 600 278,168 118,305 3,632 898 3,464 78 2,259 8,628 2 9 389,500 16,412 13,818 1,650 464 480 277,626 118,187 3:597 798 3,677 83 2,262 8,327 New York City 1974 Oct. 2 92,213 2,101 1,882 140 79 75,294 39,104 122 789 2,466 21 545 3,564 9 92,752 1,600 1,519 54 27 76,138 39,168 117 2,146 2,755 21 544 3,276 1 6 92,838 2,840 2,755 33 52 74,785 39,287 119 520 2,304 21 547 3,488 2 3 91,387 2,435 2,291 72 72 74,327 38,864 122 1,187 2.289 21 547 3,299 3 0 90,788 1,704 1,569 86 49 74,266 38,913 123 826 2,557 21 545 3,515 1975 Sept. 3 87,078 2,540 2,367 27 146 68,379 36,104 87 603 2,146 29 412 3,173 10 87,129 1,150 943 23 184 68,863 36,279 88 1,023 2,213 29 411 3,210 17 87,167 1,524 1,276 51 197 68,991 36,234 89 1.308 2,278 29 406 3,205 2 4 86,634 2,178 1,883 33 72 190 68,070 36,207 89 707 1,914 15 406 3,193 Oct. 1 88,046 2,240 1,902 42 296 69,277 36,192 86 845 2,243 15 402 3,503 8 87,467 1,186 1,017 46 123 69,544 36,061 87 1.935 2,416 15 405 2,928 1 5 88,703 2,590 2,393 15 70 112 69,386 36,102 88 1.214 2,839 15 399 2,890 22 86,526 1,998 1,798 47 153 67,954 35,849 89 818 2,222 14 402 2,944 2 9 85,858 1,707 1,522 88 97 67,885 35,838 90 742 2,379 14 404 2,803 Outside New York City 1974 Oct. 2 305,999 14,837 11,952 1,160 889 836 224,059 89,723 3,649 109 1,241 80 2,084 6,653 9 308,594 17,950 12,538 3,502 836 1,074 223,259 89,361 3.637 354 1,252 70 2,090 6,431 1 6 306,450 15,675 11,968 2,026 773 908 223,416 89,745 3.620 98 1,150 71 2,082 6,504 2 3 302,763 13,058 10,250 1,168 744 896 222,586 89.459 3.629 137 1,081 73 2,067 6,385 3 0 304,193 14,539 11,360 1,734 696 749 222,365 89,415 3.636 140 1,178 73 2,068 6,368 1975 Sept. 3 303,512 14,369 12,371 1,160 477 361 210,999 82,879 3,542 93 1,317 70 1,860 6,099 1 0 306,601 17,572 14,021 2,523 619 409 210,493 82,728 3,536 95 1,277 67 1,864 5,824 17 305,090 15,150 11,765 2,305 671 409 211,051 83.009 3,546 294 1.327 65 1,862 5,891 2 4 301,729 12,293 10,269 1,274 320 430 210,641 82,799 3.541 56 1,302 66 1,864 5,826 Oct. 1 306,926 15,537 13,128 1,246 632 531 212,294 83.522 3.546 51 1,556 72 1,856 6,064 8 307,239 16,799 12,381 2,941 958 519 211,298 83,130 3,532 313 1,404 72 1,855 5,790 15 307,385 17,081 12,880 2,620 987 594 211,372 83,098 3,528 285 1,311 66 1,874 5,807 22 303,112 13,576 11,100 1,496 533 447 210,214 82,456 3.543 80 1,242 64 1,857 5,684 29 303,642 14,705 12,296 1,562 464 383 209,741 82,349 3,507 56 1,298 69 1,858 5,524 For notes see p. A-22. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • WEEKLY REPORTING BANKS A 19 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKS—Continued (In millions of dollars) Loans (cont.) Investments Other (cont.) U.S. Treasury securities Other securities To commer- Notes and bonds cial banks maturing— Obligations Other bonds: of States corp. stocks, Wednesday and and Con- For- political securities sumer eign All Certif- subdivisions instal- govts. other Total Bills icates Total Do- For- ment mes- eign Within 1 to After Certif. tic 1 yr. 5 yrs. 5 yrs. Tax of r w an a t r s - 3 o A th l e l r p p a a r t t i i o c n i - ot A h l e l r5 Large banks- Total 1974 3 3 3 j 5 5 0 9 9 1 6 6 , , 3 3 3 4 8 3 3 3 5 5 , , 1 1 4 5 9 9 1 1, , 6 6 3 4 6 3 2 1 0 9 , , 5 8 5 2 8 4 2 1 0 9 , , 1 7 0 6 4 6 1 1 , , 5 2 5 2 1 4 3 3 , , 6 6 9 4 1 3 1 1 0 0 , . 9 9 3 2 9 7 3 3 , , 9 9 1 8 2 3 6 6 2 2 . , 1 29 5 5 5 6 6 , , 8 9 9 6 9 3 4 4 0 1 ,127 2 2 , , 4 4 3 9 1 4 1 11 1 , , 7 9 1 3 1 7 .Oct. 3 3 , , 3 3 3 6 5 2 6 6 , , 0 5 1 66 0 3 3 5 5 , , 0 0 3 7 7 7 1 1, ,6 6 2 11 6 2 1 0 9 , , 1 9 4 7 3 9 2 2 0 0 , , 3 5 7 5 3 3 2 1 , , 0 9 3 9 2 6 3 3 , , 6 6 1 2 7 4 1 1 0 0 . , 7 9 1 0 8 3 4 3 , , 0 9 4 9 2 4 6 6 2 1 , .3 0 7 1 1 9 6 6 , :3 76 2 4 4 4 4 1 0, , 8 0 1 9 8 0 2 2, , 4 4 5 4 6 7 1 1 1 1 , , 7 7 1 7 8 3 3,289 6,068 35,089 1,627 19,599 20,522 2,174 3,658 10,684 4.006 61,585 6.254 40.799 2,582 11.950 1975 2,236 5,846 34,341 1,530 18,177 34,288 9,049 4,937 17,276 3,026 60,015 6,213 39,904 2,395 11,503 . Sept. 3 2,283 5,785 34,361 1,432 18,11 35,243 9,637 5,295 17,308 3,003 60,409 6,451 39,944 2,415 11,599 10 2,417 5,713 34,414 1.414 17,963 35,013 9,838 5,351 16,959 2,865 60,528 6,503 40,114 2,394 11,517 17 2,368 5,864 34,467 1.452 18,106 35,015 10,069 5,319 16,776 2,851 60,166 6,412 39,799 2,368 11,587: 24 2,550 5,827 34,561 1,405 18,538 35,316 10,073 5. 16,902 2,881 60,308 6,395 39,895 2,409 11,609 .Oct. 1 2,399 5,938 34,530 1.415 18,128 35,604 10,205 5. 17,003 3,035 60,275 6,323 39,814 2,365 11,773 2,392 5,926 34,519 1.453 18,457 34,892 9,820 5; 374 16,819 2,879 60,767 6.709 39.824 2,367 11,867 .15 2,422 5,858 34,565 1,477 18,080 35,5-72 9,552 5,396 17,790 2,834 60,324 6,409 39,666 2,328 11,921 .22 2,292 5,777 34,652 1,521 17,965 35,032 9,042 5,485 17,793 2,712 60,430 6,685 39,805 2,333 11,607 .29 New York City 1974 1,654 3,032 2,599 871 4,702 3,768 33 372 1,970 1,393 11,050 2,370 5,714 473 2,493 .Oct. 2 1,552 3,108 2,633 885 4,239 4,097 401 336 1.898 1,462 10,917 2,284 5,778 472 2,383 . 9 1,495 3,345 2,627 874 4,333 4,420 738 344 1 ;893 1,445 10,793 2,276 5,725 427 2,365 16 1,513 2,880 2,615 852 4,379 4,115 472 344 1,829 1,470 10,510 2,040 5,614 447 2,409 23 1,521 2,977 2,630 832 4,080 4,322 630 361 1,853 1,478 10,496 1,977 5,541 505 2,473 30 1975 1.032 2,568 2,511 614 3,786 7,163 1,850 510 3,981 822 8,996 1,239 5,351 507 1,899 . Sept. 3 1.033 2,506 2,578 535 3,780 8,032 2,498 515 4,230 789 9,084 1,268 5,398 515 1,903 10 1,063 2,407 2.584 529 3,696 7,351 2,278 494 3,913 666 9,301 1,388 5,588 506 1,819 17 1,054 2,536 2,588 530 3,755 7,264 2,225 537 3,818 684 9,122 1,356 5,444 496 1,826 24 ,176 2,511 2.588 522 3,904 7,384 2,304 665 3,722 693 9,145 1,340 5,459 501 1,845 .Oct. 1 988 2,583 2,591 517 3,814 7,763 2,536 647 3,742 838 8,974 1,291 5,410 496 1,777 993 2,576 2.585 546 3,950 7,645 2,507 644 3,791 703 9,082 1,275 5,448 498 1,861 . 15 976 2,550 2.589 585 3,752 7,587 2,183 584 4,191 629 8,987 1,254 5,401 496 1,836 .22 905 2,503 2,596 644 3,840 7,276 1,932 574 4,199 571 8,990 1,317 5,406 493 1,774 .29 Outside New York City 1974 1,937 3,31 32,560 772 15,856 15,998 1,191 3,319 8,969 2,519 51,105 4,529 35,174 1,958 9,444 .Oct. 2 1 1 , , 8 9 6 5 7 7 3 3 , , 2 2 2 3 1 0 3 3 2 2 , , 4 51 5 6 0 7 7 5 3 1 7 1 1 5 5 , , 8 5 1 8 0 5 1 1 6 6 , , 1 0 3 0 3 7 i;2 1 9 5 4 0 3 3 , , 2 3 8 0 0 7 9 9 , , 0 0 2 1 9 0 2 2 , , 5 52 4 1 9 5 51 1 , , 3 2 7 2 8 6 4 4 , , 4 6 8 7 8 9 3 3 5 5 , , 3 3 4 6 9 5 ' 0 0 2 2 0 2 9 9 , , 3 32 5 8 3 1 9 6 1,822 3,130 32,422 774 15,600 16,258 ' ,524 " 273 8,889 2,572 50,861 4,284 35,204 2,009 9,364 23 1,768 3,091 32,459 795 15,519 16,200 1,544 3,297 8,831 2,528 51,089 4,277 35,258 2,077 9,477 30 1975 1,204 3.278 31,770 916 14,391 27,125 7,199 4,427 13,295 2.204 51,019 4,974 34,553 1,888 9,604 . Sept. 3 1,250 3.279 31,783 897 14,331 27,21' 7,139 4,780 13,078 2,214 51,325 5,183 34,546 1,900 9,696 10 1,354 3,306 31,830 885 14,267 27,662 ~ 560 4,857 13,046 2,199 51,227 " 115 34,526 1,888 9,698 17 1,314 3,328 31,879 922 14,351 27,751 7,844 4,782 12,958 2,167 51,044 5,056 34,355 1,872 9,761 24 1,374 3,316 31,973 883 14,634 27,932 7,769 4,795 13,180 2,188 51,163 055 34,436 1,908 9,764 Oct. 1,41' 3,355 31,939 898 14,314 27,841 7,669 4,714 13,261 2,197 51,301 5,032 34,404 1,869 9,996 1,399 3,350 31,934 907 14,507 27,247 ,313 4,730 13,028 2,176 51,685 5,434 34,376 1,869 10,006 1,446 3,308 31,976 892 14,328 27,985 ,369 4,812 13,599 2.205 51,337 155 34,265 1,832 10,085 1,387 3,274 32,056 877 14,125 27,756 ,110 4,911 13,594 2,141 51,440 368 34,399 1,840 9,833 For notes see p. A-22. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

>0 A 138W EEKLYR EPORTING BANKS • NOVEMBER 1975 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKS—Continued (In millions of dollars) Deposits Demand Cash Bal- Investitems Re- Cur- ances ments Total in serves rency with in sub- Other assets/ Domestic WI process with and do- sidiar- assets total interbank of F.R. coin mestic ies not liabil- States collec- Banks banks consol- ities and tion idated Total polit- U.S. 6 IPC ical Govt. Com- Mutual sub- mer- savdivi- cial ings sions -org 2 33,872 24,163 4,394 10,485 1 .642 30,432 503,200 160,987 115,075 6,164 3,195 22,460 854 9 29,963 20,139 4,448 10,505 1,622 29,964 497.987 154.150 111,950 5,877 1,074 21,739 826 16 42,009 27,592 4,628 11,918 1.585 29.406 516,426 170,097 120,145 5,984 1,850 26,780 773 23 33,616 24,425 4,752 10,703 L600 29.654 498.900 156,319 113,339 5,568 1,030 24,076 691 30 33.857 23,873 4.865 11,178 1.605 30;543 500,902 159,896 115,026 6,106 1,155 23,832 679 3 36,974 22,651 4,796 11,787 1,752 37,356 505,906 165.445 120,411 6,198 1,243 24,635 781 10 31,764 20,995 4,927 10,760 1,753 38,210 502,139 160,028 118,669 6,088 1,473 21,677 711 17 32,351 18,689 4,964 11,301 1,751 37,740 499,053 161,658 118,337 5,847 2,764 22,175 700 24 28,630 22,378 5,048 11,646 1.747 37.942 495,754 154,453 113,640 6,067 1,442 21,613 649 1 36,813 21,410 4,768 13,277 1 ,794 38,661 511,695 167,744 119,800 6,496 1 ,070 25,790 912 8 33,427 19,373 4,640 11,965 1,800 37,588 503,499 160,314 117,589 5,731 894 23,048 837 15 41.706 20,764 4,935 14,116 i ;soi 37,664 517,074 173,414 125.680 6,161 1,635 26,153 832 22 32,611 21,764 5,008 12,469 1,792 37,881 501,163 159,326 115,960 5,817 1,442 23,341 754 29 31.804 22,326 5.150 11,509 1,794 38.013 500,096 159.252 116,161 5,784 1,248 22,099 781 /ew 2, 10,918 6,292 504 4,238 711 10,059 124,935 45,234 26,190 307 485 10,219 511 9. 10,195 5,559 523 4,492 709 10,073 124,303 43,499 24,187 406 121 10,648 434 16. 15,911 7,252 511 5,358 709 9,539 132,118 50,800 26,442 298 242 13,988 426 23. 13,441 5,724 507 5,189 713 9,911 126,872 46,580 25,580 317 109 13,385 383 30. 12,442 7,938 524 5,363 724 10,285 128,064 47.182 26,049 366 128 12,088 365 3. 11,063 6,252 517 4,648 795 12,595 122,948 44.789 25,673 389 99 10,936 421 10. 10,321 6,624 544 4,493 787 13,255 123,153 43,016 25,410 318 206 10,050 372 17. 10,518 4,216 518 4,817 788 12,425 120,449 43,976 25,334 337 282 10,635 365 24. 9,336 6,028 525 5,405 796 12,617 121,341 42,480 24,126 381 178 10,869 338 1 . 13,607 7,238 508 6,466 802 12.949 129.616 49,039 26,434 418 76 13,276 542 8. 12,200 5,623 515 5,372 801 12^918 124,896 45,372 26,226 345 62 10,965 459 15. 14,176 6,255 518 6,392 801 12,384 129,229 48,961 27,610 415 223 12,738 454 22. 10,743 5,566 525 5,685 801 12,941 122,787 44,208 24,421 310 171 11,754 418 29. 11,865 7,283 523 4,993 803 12.439 123,764 45,020 25,321 232 127 10,567 427 O ew 2. 22,954 17,871 3,890 6,247 931 20,373 378,265 115,753 88,885 5,857 2,710 12,241 343 9. 19,768 14,580 3,925 6,013 913 19,891 373,684 110,651 87,763 5,471 953 11,091 392 16. 26,098 20,340 4,117 6,560 876 19,867 384,308 119,297 93,703 5,686 1,608 12,792 347 23. 20,175 18,701 4,245 5,514 887 19,743 372,028 109,739 87,759 5,251 921 10,691 308 30. 21,415 15,935 4,341 5,815 881 20,258 372,838 112,714 88,977 5,740 1,027 11,744 314 3. 25,911 16,399 4,279 7,139 957 24,761 382,958 120,656 94,738 5,809 1,144 13,699 360 10. 21,443 14,371 4,383 6,267 966 24,955 378,986 117^012 93,259 5,770 1,267 11,627 339 17. 21,833 14,473 4,446 6,484 963 25,315 378,604 117,682 93,003 5,510 2,482 11,540 335 24. 19,294 16,350 4,523 6,241 951 25,325 374,413 111,973 89,514 5,686 1,264 10,744 311 23,206 14,172 4,260 6,811 992 25,712 382,079 118,705 93,366 6,078 994 12,514 370 8! 21,227 13,750 4,125 6,593 999 24,670 378,603 114,942 91,363 5,386 832 12,083 378 15. 27,530 14,509 4,417 7,724 1.000 25,280 387,845 124,453 98,070 5,746 1,412 13,415 378 22. 21,868 16,198 4,483 6,784 991 24,940 378,376 115,118 91,539 5,507 1,271 11,587 336 29. 19,939 15,043 4,627 6,516 991 25,574 376,332 114,232 90,840 5,552 1,121 11,532 354 r nc Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • WEEKLY REPORTING BANKS A 21 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKS—Continued (In millions of dollars) Deposits (cont.) Borrowings from— Demand (cont.) Time and savings Federal Other Foreign IPC funds liabili- Certi- States pur- ties, Wednesday fied and Do- chased, etc. 8 and polit- mes- For- etc. 7 F.R. Com- offi- Total 6 ical tic eign Banks Others mer- cers' Sav- Other sub- inter- govts.2 cial checks ings divi- bank banks sions Large banks— Total 1974 5.199 6,874 221,496 57,220 119,472 24,640 7.620 10,787 50,055 2,183 5,892 23,610 Oct. 2 5,281 6.248 221.122 57,380 118,792 24,999 7.531 10,659 51,742 311 6,022 25,696 9 5,601 7^81 221,182 57,436 118,927 24,970 7,460 10.630 53.900 1,278 5,544 25,526 16 4,961 5,559 221,596 57,462 119,376 24,945 7,259 10,742 48,912 1,907 5.564 25,731 23 4.635 7.216 219,890 57,408 118.238 24.540 7,217 10.627 49.896 1.285 5 >48 25.604 30 1975 5,023 5.939 222,765 65,246 114,625 22,366 7,815 11.409 49,020 85 4,036 22,933 Sept. 3 4,651 5.615 223,268 65,223 115,079 22,096 7,742 11.798 48,006 1 .589 4,075 23,545 10 4,941 5,597 222,937 65,207 114,871 22,027 7,770 11,782 45.170 201 4,013 23,520 17 5.033 4,971 225,003 65,214 116,251 22,154 7,999 11,985 45.850 1 .182 4,023 23,606 24 5,176 7,277 225,264 65,590 116,180 21,950 7,928 12,241 48,443 393 3.962 23,869 Oct. 1 4,881 6,215 226,109 65,729 116,309 22,168 8,064 12,508 47.382 38 4.102 23,499 8 5,042 6,809 224,886 65,767 115,368 22,035 8,053 12,308 47,821 353 4.113 24.543 15 4,803 6.128 225.568 65,931 115,848 22,089 8,096 12,249 45,350 842 4, 195 23,973 22 4,684 7.354 224,963 65.928 115,440 22,149 8.030 12.071 46,370 3.954 23,572 29 New York City 1974 3.869 2,716 46,753 4,932 27,892 1,892 4,423 6,443 11,* 2,371 8,498 .Oct. 2 3,947 2,813 46,536 4,945 27,712 1,949 4,355 6.384 12,850 2,421 8,764 . 9 4,289 4,075 46,850 4,964 28,045 1,955 4,299 6,363 12,879 230 2.197 8,928 .16 3,657 2.266 46,914 4,957 28.155 2,016 4,142 6,360 10,859 1 ,038 2,262 9,012 .23 3,384 3.741 46,366 4,945 27,846 1 ,871 4.069 6,309 12.908 370 2,140 8,924 30 3,723 2,552 44,686 5,739 26,429 1.134 3,447 7,110 11,987 2,099 8,169 . Sept. 3 3,348 2,383 44,694 5.729 26,238 1.135 3,303 7,421 12,272 1,502 2,075 8,344 10 3,618 2,391 44,483 5,720 26,079 1.116 3,201 7,528 10,486 2,060 8,238 17 3,754 2,006 44,989 5,717 26,320 1,101 3,221 7,674 11,614 2,066 8,386 24 3,835 3.472 45,156 5,733 26.280 1 ,124 3,183 7,928 13,078 2,001 8,862 .Oct. 1 3,488 2,924 45,863 5,716 26.731 1.089 3,323 8.146 11.303 1 ,981 8,897 3,447 3.214 45,405 5.712 26.376 1.052 3,354 8,036 11,277 275 1,995 9,: .15 3,500 2; 793 45,597 5,727 26,556 1 ,040 3,416 7,984 9,895 680 2,106 8.895 .22 3.326 4,116 45,218 5.730 26.335 1,046 3,428 7,827 11,681 1 ,835 8.583 .29 Outside New York City 1,330 4,158 174,743 52,288 91 ,580 22,748 3, 197 4,344 38,207 2,183 3,521 15,112 2 1,334 3.435 174,586 52,435 91,080 23,050 3,176 4,275 38.892 311 3.601 16,932 . 9 1,312 3,606 174,332 52,472 90,882 23,015 3,161 4,267 41,021 1,048 3,347 16,598 .16 1,304 3,293 174,682 52,505 91,221 22,929 3,117 4,382 38.053 869 3,302 16,719 .23 1.251 3,475 173,524 52,463 90,392 22,669 3,148 4,318 36,988 915 3.308 16,680 .30 1975 1,300 3,387 178,079 59,507 88,196 21,232 4,368 ,299 37,033 85 1,937 14,764 . Sept. 3 1,303 3,232 178,574 59,494 88,841 20,961 4,439 ,377 35,734 87 2,000 15,201 10 1,323 3,206 178,454 59,487 88,792 20,911 4,569 ,254 34,684 201 1,953 15:282 17 1,279 2,965 180,014 59,497 89,931 21,053 4,778 ,311 34,236 632 1,957 15,220 24 1,341 3,805 180,108 59,857 89,900 20,826 4,745 ,313 35,365 393 1,961 15,007 . Oct. 1 1,393 3,291 180,246 60,013 89,578 21,079 4,741 ,362 36,079 38 2,121 14,602 1,595 3,595 179,481 60,055 88,992 20,983 4,699 ,272 36,544 78 2,118 14,663 .15 1,303 3,335 179,971 60,204 89,292 21,049 4,680 ,265 35,455 162 2,089 15,078 .22 1,358 3,238 179,745 60,198 89,105 21,103 4,602 4,244 34.689 3 2,119 14,989 .29 For notes see p. A-22. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 22 WEEKLY REPORTING BANKS • NOVEMBER 1975 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKS—Continued (In millions of dollars) Reserves Memoranda for— Total Total Large negotiable Gross capital loans time CD's All other large liabili- Wednesday Total and De- included in time time deposits12 ties of Secur- loans invest- mand and savings deposits11 banks Loans ities (gross) ments deposits to ad- (gross) ad- their justed9 ad- justed 1 o Issued Issued Issued Issued foreign justed9 to to Total to to branches IPC's others IPC's others Large banks— Total 1974 Oct. 2 5,173 33,740 298,866 380,787 101,460 89,501 61,808 27,693 2,372 9 5,145 33,735 301,381 383,780 101,374 88,845 61,173 27,672 2,188 16 5.148 33,687 298,631 381,203 99,458 88,671 61,246 27,425 3,140 2 3 5,143 33.664 296,530 378,274 97,597 88,975 61,655 27,320 2,709 30 5,143 33,676 296,656 478.763 101.052 87,673 60.619 27,054 2,131 1975 Sept. 3 5.775 35,763 279,313 373,616 102,593 33.277 18,046 15,231 81,814 55,222 26,592 2,327 10 5,797 35,762 280,831 376,483 105,114 33 i288 18,099 15,189 82.374 55,622 26,752 2,353 17 5.791 35,693 281,258 376,799 104.368 33.204 18.182 82.078 55,332 26,746 2,613 2 4 5,794 35,774 278,662 373,843 102,768 33.216 18.179 84.180 56,764 27,416 2,304 Oct. 1 5,781 36,170 281,768 377,392 104.071 33,019 18.273 14.746 83,996 56,373 27,623 2,723 8 5,800 36,185 283,030 378,909 102.945 33,387 18.370 15.017 84,486 56,510 27,976 3,085 1 5 5,778 36,091 282,764 378,423 103,920 33,345 18,341 15,004 83,277 55.622 27,655 4.233 22 5,743 36,095 278,422 374,318 101,932 33,395 18.370 15.025 83,714 56,091 27,623 3; 232 2 9 5,756 36,155 277,928 373.390 104.101 33.404 18.355 15.049 83,388 56,011 27,377 2.916 New York City 1974 Oct. 2 1,418 8,813 73,859 88,677 23,612 30,235 20,168 10,067 1,436 9 1,412 8,821 74,667 89,681 22,535 30,085 20,049 10,036 1,215 1 6 1,415 8,819 73.375 88,588 20.659 30,149 20,295 9,854 2,179 2 3 1,415 8,792 72,958 87,583 19,645 30,111 20,437 9,674 2,014 3 0 1 .408 8,766 72,880 87,698 22,524 29,616 20,039 9,577 1,459 1975 Sept. 3 1 ,732 9,486 67,520 83,679 22,691 7,722 4.854 2,868 28,812 19,166 9,646 1,528 10 1,741 9,509 68.037 85,153 22.439 7,738 4,849 2,889 28,857 19,025 9,832 1.605 17 1,731 9,475 68,176 84,828 22,541 7,662 4,819 2.843 28,658 18,855 9,803 1,765 2 4 1,733 9,523 67,311 83,697 22,097 7,536 4,691 2.845 29,333 19,266 10,067 1,482 Oct. 1 1,681 9,799 68,439 84,968 22,080 7,522 4,743 2,779 29,427 19,124 10,303 1,923 8 1,672 9,808 68,725 85,462 22.145 7,466 4,718 2.748 30,248 19,605 10,643 1,991 1 5 1,656 9,779 68.590 85,317 21.824 7,417 4,717 2.700 29,828 19,237 10,591 3,472 22 1,621 9.784 67,178 83,752 21,540 7,368 4,651 2.717 30,066 19,503 10,563 2,077 2 9 1 ;641 9.785 67,165 83,431 22.461 7,295 4,581 2.714 29/846 19,439 10,407 2,071 Outside New York City 1974 Oct. 2 3,755 24,927 225,007 292,110 77,848 59,266 41,640 17,626 936 9 3,733 24,914 226,714 294,099 78,839 58,760 41,124 17,636 973 1 6 3,733 24,868 225,256 292,615 78,799 58,522 40,951 17,571 961 2 3 3,728 24,872 223,572 290,691 77.952 58,864 41,218 17,646 695 3 0 3,735 24,910 223,776 291,065 78,528 58.057 40,580 17,477 672 1975 Sept. 3 4,043 26,277 211.793 289,937 79,902 25,555 13,192 12.363 53,002 36,056 16,946 799 10 4,056 26,253 212.794 291,330 82,675 25,550 13,250 12,300 53,517 36,597 16,920 748 17 4.060 26,218 213,082 291,971 81,827 25,542 13,363 12,179 53,420 36,477 16,943 848 2 4 4.061 26,251 211,351 290,146 80,671 25,680 13,488 12.192 54,847 37,498 17,349 822 Oct. 1 4,100 26,371 213,329 292,424 81,991 25,497 13,530 11,967 54,569 37,249 17,320 800 8 4,128 26,377 214,305 293,447 80,800 25,921 13,652 12,269 54,238 36,905 17,333 1,094 15 4,122 26,312 214,174 293,106 82,096 25,928 13,624 12,304 53,449 36,385 17,064 761 22 4,122 26,311 211,244 290,566 80,392 26,027 13,719 12,308 53,648 36,588 17,060 1,155 29 4,115 26,370 210,763 289,959 81,640 26,109 13,774 12,335 53,542 36,572 16,970 845 1 Includes securities purchased under agreements to resell. 8 Includes minority interest in consolidated subsidiaries. 2 Includes official institutions and so forth. 9 Exclusive of loans and Federal funds transactions with domestic com- 3 Includes short-term notes and bills. mercial banks. 4 Federal agencies only. 10 All demand deposits except U.S. Govt, and domestic commercial 5 Includes corporate stocks. banks, less cash items in process of collection. 6 Includes U.S. Govt, and foreign bank deposits, not shown separately. 11 Certificates of deposit issued in denominations of $100,000 or more. 7 Includes securities sold under agreements to repurchase. 12 AH other time deposits issued in denominations of $100,000 or more (not included in large negotiable CD's). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • BUSINESS LOANS OF BANKS A 23 COMMERCIAL AND INDUSTRIAL LOANS OF LARGE COMMERCIAL BANKS (In millions of dollars) Outstanding Net change during - 1975 1975 1975 1975 1974 Industry Oct. Oct. Oct. Oct. Oct. 1st 2nd 29 22 15 8 1 Oct. Sept. Aug. III II I half half Durable goods manufacturing: Primary metals 1,979 1,932 2,001 2,000 1,972 -31 24 1 --1133 -23 41 18 140 Machinery 6,066 6,173 6,292 6,328 6,475 -474 -296 -244 -887 -642 -672 -1 ,314 222 Transportation equipment 3,155 3,130 3,131 3,164 3,282 -157 19 -214 -198 -296 -6 -302 705 Other fabricated metal products... 2,277 2,327 2,375 2,376 2,353 -169 6 -55 -277 -211 23 -188 75 Other durable goods 33,,776633 33,,883300 33,,991155 3,939 33,,994477 -204 -25 -83 -174 -316 -402 -718 247 Nondurable goods manufacturing: Food, liquor, and tobacco 3,375 3,350 3,311 3,315 3,284 50 120 134 13 -519 -1,090 --11 ,,660099 984 Textiles, apparel, and leather 2,962 3,035 3,110 3,143 3,150 -206 -72 16 -55 -148 -139 -287 -618 Petroleum refining 2,560 2,538 2,558 2,671 2,641 -36 56 17 118 283 -55 228 967 Chemicals and rubber 2,821 2,826 2,829 2,833 2,808 -48 95 -79 -253 -321 61 -260 256 Other nondurable goods 11,,993355 11,,996600 22,,000033 1 ,995 1 ,998 -140 30 -120 -148 10 -293 -283 23 Mining, including crude petroleum and natural gas 5,286 5,247 5,245 5,197 5,287 122 153 -43 285 109 -267 -158 846 Trade: Commodity dealers 1 ,375 1 ,383 1,292 1,247 1,297 133 114 11 137 -328 -644 -972 508 Other wholesale 5,586 5,571 5,541 5,470 5,525 44 -69 -27 -78 -534 -574 -1 ,108 484 Retail 6,365 6,300 6,240 6,124 6,129 366 -104 -14 -310 -212 -186 -398 -465 Transportation 5,967 5,955 6,032 6,035 6,071 26 -47 -33 -122 -142 -181 -323 283 Communication 2,019 2,051 2,177 2,178 2,225 -14 -72 - 24 -111 17 -372 -355 -2 Other public utilities 6,887 6,979 6,941 7,028 7,050 -77 21 -148 -231 -404 -1,019 -1,423 1 ,697 Construction 5,396 5,452 5,426 5,440 5,500 -108 -28 -27 -57 -77 -545 -622 36 Services 10,492 10,515 10,482 10,514 10,492 -47 3 -152 -295 -388 -732 -1,120 304 All other domestic loans 9,387 9,409 9,733 9,730 9,799 -388 23 -71 15 -65 -307 -372 744 Bankers acceptances 2,629 2,311 2,312 22,,225599 2,227 539 81 -278 -170 28 571 599 -56 Foreign commercial and industrial loans 5,067 5,047 5,079 5,096 5,084 10 153 13 526 233 61 294 -447 Total classified loans 9977,,334499 9977,,332211 9988,,002255 9988,,008822 9988,,559966 -809 185 -1 ,420 --22,,228855 --33,,994466 --66,,772277 --1100,,667733 66,,993333 Comm. paper included in total classified loans1 221166 Total commercial and industrial loans of large commercial banks 118,187 118,305 119,200 119,191 119,714 -819 174 -1 ,779 -2,879 -3,845 -6,236 -10,081 8,354 For notes see table below. "TERM" COMMERCIAL AND INDUSTRIAL LOANS OF LARGE COMMERCIAL BANKS (In millions of dollars) Outstanding Net change during- Industry 1975 1975 1974 1975 Oct. Sept. Aug. July June May Apr. Mar. Feb. 1st 29 24 27 30 25 28 30 26 26 IV half Durable goods manufacturing: Primary metals 1,320 1,338 1,286 1,269 1,288 1,280 1,323 1,284 1,237 50 4 77 78 Machinery 3,538 3,737 3,825 3,864 3,977 4,269 4,302 4,071 4,117 -240 -94 249 -168 Transportation equipment 1,624 1,693 1,722 1,725 1,740 1,726 1,705 1,672 1,712 -47 68 138 67 Other fabricated metal products 1,175 1,268 1,228 1,196 1,222 1,245 1,280 1,312 1,323 46 -90 115 131 25 Other durable goods 1,950 2,012 2,042 2,058 2,090 2,122 2,210 2,251 2,256 -78 -161 -140 123 -301 Nondurable goods manufacturing: Food, liquor, and tobacco 1,451 1,471 1,461 1,440 1,514 1,616 1,571 1,561 1,614 -43 -47 -202 114 Textiles, apparel, and leather 1,074 1,103 1,077 1,116 1,095 1,075 1,091 1,158 1,083 -63 13 -6 -50 Petroleum refining 1,914 1,967 1,889 1,828 1,709 1,61 1,617 1,483 1,458 258 226 -35 421 191 Chemicals and rubber. 1,605 1,665 1,645 1,678 1,762 1,784 1,814 1,846 1,812 -97 -84 -32 100 -116 Other nondurable goods. 995 1,056 1,023 1,085 1,143 1,114 1,126 1,130 1,119 -87 13 -105 31 -92 Mining, including crude petroleum and natural gas 3,896 3,847 3,754 3,801 3,734 3,646 3,626 3,537 3,446 113 197 -164 362 33 Trade: C O o th m e m r o w d h it o y le d s e a a l l e e . r . s . . . 1,4 1 0 6 3 2 1.3 1 1 5 9 0 1,3 1 7 4 1 8 1,3 1 4 5 4 2 1,3 1 2 4 9 8 1,3 1 4 4 4 0 1,3 1 8 4 7 2 1,4 1 5 5 0 0 1,4 1 2 5 0 3 -10 2 -1 - 2 2 1 -4 -5 2 4 1 3 6 -1 - 6 7 3 Retail 2,150 '2,153 2,139 2,111 2,136 2,143 2,192 2,283 2,298 '17 -147 -311 67 -458 T C O r o t a h m n e m r s p u p o n u r b i t c a li a t c i t o i u o n t n i lities 4 4 1 , , , 0 4 1 2 2 2 7 2 0 4 3 1 , , , 3 9 1 9 6 3 1 6 2 4 3 1 , , , 4 9 1 0 0 4 5 2 9 4 4 1 , , , 0 3 1 1 9 3 8 9 6 4 4 1 , , , 0 4 1 4 2 3 5 5 3 4 4 1 , , , 0 4 1 4 2 5 7 4 9 4 4 1 , , , 0 4 1 1 9 4 7 2 8 4 4 1 , , , 0 5 1 3 2 3 4 4 5 4 3 1 , , , 5 8 1 0 7 2 5 0 5 - — 7 — 9 3 4 1 - - 9 2 9 -2 7 5 6 1 3 2 2 9 0 5 1 1 3 -12 8 5 5 2 1 C S A e o l r l n v o s ic t t r h e u s e c r t d io o n m es * t ic loans 2 3 5 , , , 2 0 0 6 9 5 7 7 4 > 2 3 " , , 5 3 2 ,1 5 4 2 9 4 2 2 3 5 , , , 3 2 0 6 5 1 7 7 0 2 3 5 , , , 3 1 2 5 3 6 5 2 0 2 5 3 , , , 2 3 1 5 1 4 8 4 0 2 5 3 , , , 2 2 1 9 4 8 1 6 6 2 3 5 , , , 2 2 3 7 1 5 2 0 2 2 3 5 , , , 1 0 4 9 8 3 7 2 0 2 3 5 , , , 1 1 3 9 4 7 1 4 0 '- - - 1 1 4 4 8 5 -2 1 1 9 7 1 0 6 7 - - 1 1 -9 4 0 7 2 2 1 1 2 0 8 2 2 2 -39 2 3 2 0 4 Foreign commercial and industrial loans 2,834 2,763 2,695 2,676 2,594 2,547 2,596 2,528 2,544 169 66 71 56 137 Total loans 47,078 47,756 47,395 47,643 47,796 48,015 48,473 48,118 47,797 -40 -322 -1,081 2,773 ,403 1 New item to be reported as of the last Wednesday of each month. For description of series see article "Revised Series on Commercial and Industrial Loans by Industry," Feb. 1967 BULLETIN, p. 209. NOTE.—About 160 weekly reporting banks are included in this series; Commercial and industrial "term" loans are all outstanding loans with these banks classify by industry, commercial and industrial loans amount- an original maturity of more than 1 year and all outstanding loans granted ing to about 90 per cent of such loans held by all weeklv reporting banks under a formal agreement—revolving credit or standby—on which the and about 70 per cent of those held by all commercial banks. original maturity of the commitment was in excess of 1 year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 24 DEMAND DEPOSIT OWNERSHIP • NOVEMBER 1975 GROSS DEMAND DEPOSITS OF INDIVIDUALS, PARTNERSHIPS, AND CORPORATIONS1 (In billions of dollars) Type of holder Class of bank, and quarter or month F b i u n s a i n n c e i s a s l No b n u f s i i n n a e n s c s ial Consumer Foreign o A th l e l r All insured commercial banks: 1970—De c 17.3 92.7 53.6 10.3 1971—Sep t 17.9 91.5 57.5 1.2 9.7 Dec 18.5 98.4 58.6 1.3 10.7 1972—Ma r 20.2 92.6 54.7 1.4 12.3 June 17.9 97.6 60.5 1.4 11.0 Sept 18.0 101.5 63.1 1.4 11.4 Dec 18.9 109.9 65.4 1.5 12.3 1973—Ma r 18.6 102.8 65.1 1.7 11.8 June 18.6 106.6 67.3 2.0 11.8 Sept 18.8 108.3 69.1 2.1 11.9 Dec 19.1 116.2 70.1 2.4 12.4 1974—Ma r 18.9 108.4 70.6 2.3 11.0 J S u e n p e t 1 1 7 8. .9 2 1 1 1 12 3 . .9 1 7 7 2 1 . . 0 4 2 2. . 2 1 1 1 0 1. .9 1 Dec 19.0 118.8 73.3 2.3 11 .7 1975—Ma r 18.6 111.3 73.2 2.3 10.9 June 19.4 115.1 74.8 2.3 10.6 Sept.2' 19.0 118.7 76.5 2.2 10.6 Weekly reporting banks: 1971—De c 14.4 58.6 24.6 1.2 5.9 1972—De c 14.7 64.4 27.1 1.4 6.6 1973—De c 14.9 66.2 28.0 2.2 6.8 1974—Sep t 13.9 64.4 28.4 2.0 6.3 N Oc o t v 1 1 4 4 . . 7 6 6 65 4 . . 9 4 2 28 8 . . 7 4 2 2 . . 0 1 6 6 . . 4 5 Dec 14.8 66.9 29.0 2.2 6.8 1975—Ja n 14.8 65.6 29.2 2.2 6.6 Feb 14.4 63.1 27.9 2.3 6.2 Mar 14.1 63.2 28.2 2.2 6.4 Apr 15.0 63.3 30.1 2.2 6.5 May 14.2 63.1 29.2 2.3 6.2 June 15.1 65.1 29.5 2.2 6.2 July 15.0 65.3 29.8 2.2 6.5 Aug 14.4 64.6 29.1 2.0 5.9 Sept.? 14.7 65.5 29.6 2.1 6.2 1 Including cash items in process of collection. from reports supplied by a sample of commercial banks. For a detailed description of the type of depositor in each category, see June 1971 NOTE.—Daily-average balances maintained during month as estimated BULLETIN, p. 466. DEPOSITS ACCUMULATED FOR PAYMENT OF PERSONAL LOANS (In millions of dollars) Class of Dec. 31, Dec, 31, Apr. 16, June 30, Class of Dec. 31, Dec, 31, Apr. 16, June 30, bank 1973 1974 1975 1975 bank 1973 1974 1975 1975 All commercial 555555500000007777777 333333388888889999999 333333333333338888888 AAllll mmeemmbbeerr——CCoonntt.. Insured 555555500000003333333 333333388888887777777 333333666666333333 333333333333335555555 OOtthheerr llaarrggee bbaannkkss 11 55555558888888 66666669999999 777777333333 77777774444444 National member 222222288888888888888 222222233333336666666 222222222222444444 222222222222223333333 All other member 1 222222299999994444444 222222200000006666666 111111888888888888 111111188888886666666 State member 66666664444444 33333339999999 333333777777 33333336666666 All nonmember 111111155555555555555 111111111111115555555 111111000000222222 77777779999999 All member 333333355555552222222 222222277777775555555 222222666666111111 222222266666660000000 Insured 111111155555552222222 111111111111112222222 111111000000222222 77777776666666 Noninsured 3333333 3333333 3333333 i Beginning Nov. 9, 1972, designation of banks as reserve city banks for NOTE.—Hypothecated deposits, as shown in this table, are treated one reserve-requirement purposes has been based on size of bank (net demand way in monthly and weekly series for commercial banks and in another deposits of more than $400 million), as described in the BULLETIN for way in call-date series. That iz, they are excluded from "Time deposits" July 1972, p. 626. Categories shown here as "Other large" and "All other and "Loans" in the monthly (and year-end) series as shown on p. A-14; member" parallel the previous "Reserve City" (other than in New York from the figures for weekly reporting banks as shown on pp. A-18-A-22 City and the City of Chicago) and "Country" categories, respectively (consumer instalment loans); and from the figures in the table at the (hence the series are continuous over time). bottom of p. A-13. But they are included in the figures for "Time deposits" and "Loans" for call dates as shown on pp. A-14-A-17. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • LOAN SALES BY BANKS; OPEN MARKET PAPER A 25 LOANS SOLD OUTRIGHT BY LARGE COMMERCIAL BANKS (Amounts outstanding; in millions of dollars) To selected related institutions 1 By type of loan Date Commercial Real and estate industrial 1975—July 2 4,648 2,907 196 9, 4,599 2,827 192 2 1 3 6. . 4 4 , , 4 4 7 8 0 4 2 2 , , 7 7 5 3 5 4 1 1 8 8 9 8 30. 4,500 2.763 186 Aug. 6. 4,470 2,758 195 13. 4,510 2,794 195 20. 4,463 2.764 195 27. 4,479 2,757 198 Sept. 3. 4,420 2,703 198 1 To bank's own foreign branches, nonconsolidated non- 10. 4,446 2,741 198 bank affiliates of the bank, the bank's holding company (if 17. 4,479 2,775 198 not a bank), and nonconsolidated nonbank subsidiaries of 24. 4,498 2,763 199 the holding company. NOTE.—Series changed on Aug. 28, 1974. For a comparison Oct. 1. 4,541 2,814 198 of the old and new data for that date, see p. 741 of the Oct. 8. 4,655 2,825 199 1974 BULLETIN. Revised figures received since Oct. 1974 15. 4,674 2,867 199 that affect that comparison are shown in note 2 to this table 22. 4,730 2,897 198 in the Dec. 1974 BULLETIN, p. A-27. 29. 4,712 2,900 198 COMMERCIAL PAPER AND BANKERS ACCEPTANCES OUTSTANDING (In millions of dollars) Commercial paper Dollar acceptances Financial Bank-related 5 Held by- Based on— companies1 Non- All finan- Accepting banks issuers cial Im- Ex- Dealer- Di- com- Dealer- Di- Others ports ports placed rectly- panies' placed rectly- For- into from placed 3 placed Total Own Bills Own eign United United bills bought acct. corr.6 States States 13,645 2.332 10,556 757 3,603 1,198 983 215 193 191 2,022 997 829 17,085 2,790 12,184 2,111 4,317 1,906 1,447 459 164 156 2,090 1,086 989 21,173 4,427 13,972 2,774 4,428 1,544 1,344 200 58 109 2,717 1,423 952 32,600 6,503 20,741 5,356 1,160 3,134 5,451 1 ,567 1,318 249 64 146 3,674 1,889 ,153 33,071 5,514 20,424 7,133 352 1,997 7,058 2,694 1,960 735 57 250 4,057 2,601 ,561 32,126 5,297 20,582 6,247 524 1,449 7,{ 3,480 2,689 791 261 254 3,894 2,834 1,546 34,721 5,655 22,098 6,968 1,226 1,411 6,898 2,706 2,006 700 106 179 3,907 2,531 1,909 41,073 5,487 27,204 8,382 1,938 2,943 8,892 2,837 2,318 519 68 581 5,406 2,273 3,499 '48,041 5,308 '31,848 10,885 '2,352 '6,423 16,167 3,388 2,866 522 277 1,202 11,300 3,585 3,933 r49,166 5.333 '31,174 12,659 '2,107 '6,525 16,035 3,347 2,942 405 504 1,459 10,724 3,526 3,806 r51,490 5,242 '32,245 14,003 '1,970 '6,484 16,882 3.291 2,872 419 218 2,037 11,335 3,793 3,759 r51,954 4,860 '32,562 14,532 '1,875 '6,769 17,553 3,789 3,290 499 611 1,756 11,398 3,810 3,709 r49,144 4,611 '31,839 12,694 '1,800 '6,518 18,484 4,226 4,685 542 999 1,109 12,150 4,023 4,067 '51,675 5,029 '31,998 14,648 '1,799 '6,774 18,602 4,357 3,903 454 966 560 12,718 4,120 4,314 '52,403 5,167 '32,504 14,732 '1,778 '7,305 18,579 4,864 4,370 494 993 325 12,398 3,974 4,210 '50,811 5,342 '31,205 14,264 '1,673 '7,256 18,730 4.773 4,085 688 665 263 13,029 3,845 4,296 r51,605 5,461 '32,126 14,018 '1,601 '6,984 18,727 4,485 3,900 585 1,185 235 13,034 3,690 4,206 r51,297 5,889 '32,801 12,607 '1,529 '7,075 18;108 4,450 3,892 558 865 234 12,559 3,665 4,186 '48,742 5,604 '31,093 12,045 '1,547 '7.207 17,740 4.774 4,224 550 682 319 11,965 3,466 4,080 r49,331 6,018 '31,241 12,072 '1,635 '7,016 16,930 4,778 4,275 503 685 329 11,138 3,474 3,865 49,783 5,645 32,145 11,993 1,493 7,365 16,456 4,546 3,988 558 840 304 10,538 3,305 3,806 1 Financial companies are institutions engaged primarily in activities 4 Nonfinancial companies include public utilities and firms engaged such as, but not limited to, commercial, savings, and mortgage banking; primarily in activities such as communications, construction, manufacsales, personal, and mortgage financing; factoring, finance leasing, and turing, mining, wholesale and retail trade, transportation, and services. other business lending; insurance underwriting; and other investment 5 Included in dealer- and directly-placed financial company columns. activities. Coverage of bank-related companies was expanded in Aug. 1974. Most 2 As reported by dealers; includes all financial company paper sold in of the increase resulting from this expanded coverage occurred in directlythe open market. placed paper. 3 As reported by financial companies that place their paper directly 6 Beginning November 1974, the Board of Governors terminated the with investors. System guarantee on acceptances purchased for foreign official accounts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 26 INTEREST RATES • NOVEMBER 1975 PRIME RATE CHARGED BY BANKS (Per cent per annum) Effective date Rate Effective date Rate Effective date Rate Monthly average rate 1974—Apr. 11 10 1975—Jan. 9 IO1/4 1975—July 18 71/4 1974—Sept. 12.00 19 10% 15 10 28 IVi Oct. 11.68 25 IO1/2 20 9% Nov. 10.83 28. . 91/2 Aug. 12 IVa Dec. 10.50 May 2 103^ 6 11 Feb. 3 9Va Sept. 15 8 1975—Jan. 10.05 1 1 0 7 u 1H y /42 1 1 0 8 9 8 34 Oct. 27 IVA M Fe a b r . . 7 8 . . 9 9 3 6 June 26 1134 24 sy2 M Ap a r y . 7 7 . . 4 5 0 0 Mar. 5 81/4 June 7.07 July 5 12 10 8 July 7.15 18 IVa Aug. 7.66 Oct. 7 1134 24 71/2 Sept. 7.88 21 11% Oct. 7.96 28 1114 May 20 IVa Nov. 4 11 June 9.. 1 14 1034 25 101/2 NOTE.—Beginning Nov. 1971, several banks adopted a floating prime Effective Apr. 16, 1973, with the adoption of a two-tier or "dual prime rate keyed to money market variables. Rate shown is the predominant rate," this table shows only the "large-business prime rate," which is the prime rate quoted by a majority of large "money market" banks to large range of rates charged by commercial banks on short-term loans to large businesses. businesses with the highest credit standing. RATES ON BUSINESS LOANS OF BANKS Size of loan (in thousands of dollars) All sizes 1--9 10-99 100-499 500-999 1,000 and over Center Aug. May Aug. May Aug. May Aug. May Aug. May Aug. May 1975 1975 1975 1975 1975 1975 1975 1975 1975 1975 1975 1975 Short-term 35 centers 8.22 8.16 9, .42 9.57 9.02 9.10 8.48 8.52 8.29 8.18 8.00 7.90 New York City 8.00 7.88 9, .28 9.27 8.89 9.02 8.44 8.55 7.93 7.86 7.93 7.76 7 Other Northeast 8.43 8.37 9 .83 10.00 9.33 9.34 8.71 8.63 8.67 8.51 8.01 7.95 8 North Central 8.12 8.00 9 .01 9.11 8.79 8.82 8.39 8.32 8.25 7.91 7.94 7.82 3 Southeast 8.41 8.70 9. .58 9.86 9.21 9.40 8.57 8.97 8.32 8.67 7.94 8/15 8 Southwest 8.28 8.34 9. .21 9.35 8.76 8.89 8.27 8.32 8.32 8.24 8.06 8.15 4 West Coast 8.45 8.33 9, .67 9.72 9.21 9.23 8.51 8.58 8.28 8.23 8.37 8.18 Revolving credit 35 centers 8.17 7.95 9.73 9.59 9.06 8.91 8.45 8.58 8.68 8.23 8.07 7 .84 New York City 8.37 7.92 8.91 9.04 8.94 8.94 8.41 8.37 8.30 8.16 8.37 7 .88 7 Other Northeast 8.09 7.92 10.11 10.45 9.01 8.66 8.01 8.21 8.78 7.56 7.98 7 .91 8 North Central 8.27 8.20 9.70 9.78 9.58 10.01 8.81 9.24 8.56 8.12 8.12 8 .03 7 Southeast 7.82 8.41 10.07 9.90 9.47 8.61 8.35 8.68 7.50 7.97 7.50 8 .40 8 Southwest 8.41 8.40 9.36 9.44 8.88 8.66 8.46 8.51 8.11 8.47 8.49 8 .29 4 West Coast 8.02 7.84 9.27 8.91 8.84 8.54 8.39 8.44 9.10 8.40 7.83 7 .69 Long-term 35 centers 8.89 8.22 9.45 9.94 9.47 9.36 9.01 8.83 8.54 8.47 8.89 8.05 New York City 8.77 8.38 8.80 9.92 8.53 9.50 8.86 8.69 8.01 9.02 8.80 8.31 7 Other Northeast 8.96 8.53 9.35 9.99 10.09 9.76 9.56 9.41 9.28 7.96 8.60 8.28 8 North Central 9.45 7.22 9.71 9.06 9.24 8.68 8.50 8.64 8.23 8.09 9.81 6.80 7 Southeast 8.91 8.91 8.87 10.94 9.66 9.14 9.54 7.93 8.04 9.47 8.30 9.50 8 Southwest 8.41 8.47 9.69 10.74 9.38 9.86 8.67 8.37 8.62 8.68 8.18 8.28 4 West Coast 8.57 8.71 9.60 9.15 9.24 9.20 9.28 9.06 8.47 8.67 8.47 8.66 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INTEREST RATES A 27 MONEY MARKET RATES (Per cent per annum) U.S. Government securities5 Prime Finance Period com pa m p e e r r c 1 ial pa CO p . e r ba P n ri k m e e rs ' F er e a d l - 3-month bills6 6-month bills6 9- to 12-month issues placed accept- funds 3- to 5directly, ances, rate4 year 90-119 4 to 6 3 to 6 90 days3 Rate Market Rate Market 1-year issues7 days months months 2 on new yield on new yield bill (mar- Other7 issue issue ket yield)6 1967 5.10 4.89 4.75 4.22 4.321 4.29 4.630 4.61 4.71 4.84 5.07 1968 5.90 5.69 5.75 5.66 5.339 5.34 5.470 5.47 5.46 5.62 5.59 1969 7.83 7.16 7.61 8.21 6.677 6.67 6.853 6.86 6.79 7.06 6.85 1970 7.72 7.23 7.31 7.17 6.458 6.39 6.562 6.51 6.49 6.90 7.37 1971 5.11 4.91 4.85 4.66 4.348 4.33 4.511 4.52 4.67 4.75 5 77 1972 4.66 4.69 4.52 4.47 4.44 4.071 4.07 4.466 4.49 4.77 4.86 5.85 1973 8.20 8.15 7.40 8.08 8.74 7.041 7.03 7.178 7.20 7.01 7.30 6.92 1974 10.05 9.87 8.62 9.92 10.51 7.886 7.84 7.926 7.95 7.71 8.25 7.81 1974—Oct 9.55 9.36 9.03 9.34 10.06 7.244 7.46 7.559 7.74 7.59 8.04 7.98 Nov 8.95 8.81 8.50 9.03 9.45 7.585 7.47 7.551 7.52 7.29 7.67 7.65 Dec 9.18 8.98 8.50 9.19 8.53 7.179 7. 15 7.091 7.11 6.79 7.33 7.22 1975—Jan 7.39 7.30 7.31 7.54 7. 13 6.493 6.26 6.525 6.36 6.27 6.74 7.29 Feb 6.36 6.33 6.24 6.35 6.24 5.583 5.50 5.674 5.62 5.56 5.97 6.85 Mar 6.06 6.06 6.00 6.22 5.54 5.544 5.49 5.635 5.62 5.70 6.10 7.00 Apr 6.11 6.15 5.97 6.15 5.49 5.694 5.61 6.012 6.00 6.40 6.83 7.76 May 5.70 5.82 5.74 5.76 5.22 5.315 5.23 5.649 5.59 5.91 6.31 7.49 June 5.67 5.79 5.53 5.70 5.55 5.193 5.34 5.463 5.61 5.86 6.26 7.26 July 6.32 6.44 6.01 6.40 6.10 6.164 6.13 6.492 6.50 6.64 7.07 7.72 Aug 6.59 6.70 6.39 6.74 6.14 6.463 6.44 6.940 6.94 7.16 7.55 8.12 Sept 6.79 6.86 6.53 6.83 6.24 6.383 6.42 6.870 6.92 7.20 7.54 8.22 Oct 6.35 6.48 6.43 6.28 5.82 6.081 5.96 6.385 6.25 6.48 6.89 7.80 Week ending— 1975—July 5 6.25 6.34 5.81 6.19 6.31 6.009 5.98 6.262 6.28 6.47 6.89 7.62 12 6.28 6.45 6.00 6.38 6.06 6.203 6.06 6.510 6.39 6.50 6.91 7.65 19 ... 6.28 6.43 6.00 6.35 5.93 6.045 6.05 6.344 6.41 6.53 6.91 7.67 26 6.38 6.48 6.03 6.52 6.14 6.247 6.27 6.626 6.65 6.82 7.27 7.79 Aug. 2 6.43 6.53 6.18 6.48 6.25 6.318 6.28 6.719 6.69 6.86 7.35 7.86 9 6.50 6.63 6.25 6.66 6.09 6.456 6.42 6.864 6.88 7.11 7.50 8.05 16 6.63 6.68 6.33 6.75 6.08 6.349 6.42 6.809 6.93 7.17 7.58 8.13 23 6.63 6.75 6.50 6.79 6.15 6.452 6.46 7.000 7.00 7.26 7.63 8.20 30 6.63 6.75 6.50 6.83 6.23 6.593 6.49 7.085 6.98 7.16 7.54 8.12 Sept. 6 6.75 6.75 6.50 6.82 6.06 6.381 6.38 6.866 6.89 7.07 7.43 8.07 13 6.75 6.75 6.50 6.85 6.15 6.389 6.43 6.889 6.88 7.14 7.51 8.26 20 6.85 6.93 6.50 6.82 6.28 6.444 6.45 6.901 6.97 7.31 7.64 8.34 27 6.78 6.95 6.58 6.81 6.29 6.316 6.38 6.824 6.90 7.21 7.52 8.18 Oct. 4 6.85 6.93 6.70 6.79 6.36 6.547 6.46 6.980 6.91 7.16 7.61 8.21 11 6.70 6.88 6.75 6.59 6.06 6.239 6.23 6.571 6.53 6.74 7.20 7.97 18. 6.44 6.59 6.56 6.38 5.82 6.045 6.01 6.243 6.25 6.51 6.88 7.87 25 6.08 6.23 6.23 6.04 5.73 5.887 5.73 6.156 6.06 6.29 6.66 7.67 Nov. 1 5.88 6.00 6.00 5.83 5.65 5.685 5.58 5.974 5.82 6.02 6.42 7.50 1 Averages of the most representative daily offering rate quoted by of transactions at these rates. For earlier statement weeks, the averages dealers. were based on the daily effective rate—the rate considered most repre- 2 Averages of the most representative cfaily offering rate published by sentative of the day's transactions, usually the one at which most transfinance companies, for varying maturities in the 90-179 day range. actions occurred. 3 Beginning Aug. 15, 1974, the rate is the average of the midpoint of 5 Except for new bill issues, yields are averages computed from daily the range of daily dealer closing rates offered for domestic issues; prior closing bid prices. data are averages of the most representative daily offering rate quoted by 6 Bills quoted on bank-discount-rate basis. dealers. 7 Selected note and bond issues. 4 Seven-day averages for week ending Wednesday. Beginning with statement week ending July 25, 1973, weekly averages are based on the NOTE.—Figures for Treasury bills are the revised series described on p. daily average of the range of rates on a given day weighted by the volume A-35 of the Oct. 1972 BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 28 INTEREST RATES • NOVEMBER 1975 BOND AND STOCK YIELDS (Per cent per annum) Government bonds Corporate bonds Stocks State and local Aaa utility By selected By Dividend/ Earnings/ rating group price ratio price ratio Period United Total i ( S tt l ee t o a rr n mm te g )) s - Total1 Aaa Baa New ce R n e t - ly Aaa Baa In tr d i u al s - R ro a a i d l- P u u ti b li l t i y c Pre- Com- Comissue offered ferred mon mon Seasoned issues 1970 6.59 6.42 6.12 6.75 8.68 8.71 8.51 8.04 9.11 8.26 8.77 8.68 7.22 3.83 6.46 1971 5.74 5.62 5.22 5.89 7.62 7.66 7.94 7.39 8.56 7.57 8.38 8.13 6.75 3.14 5.41 1972 5.63 5.30 5.04 5.60 7.31 7.34 7.63 7.21 8.16 7.35 7.99 7.74 7.27 2.84 5.50 1973 6.30 5.22 4.99 5.49 7.74 7.75 7.80 7.44 8.24 7.60 8.12 7.83 7.23 3.06 7.12 1974 6.99 6.19 5.89 6.53 9.33 9.34 8.98 8.57 9.50 8.78 8.98 9.27 8.23 4.47 11 .60 1974—Oct 7.22 6.56 6.21 6.99 10.16 10.23 9.80 9.27 10.41 9.53 9.64 10.31 8.78 5.38 Nov 6.93 6.54 6.06 7.01 9.21 9.34 9.60 8.89 10.50 9.30 9.59 10.14 8.60 5.13 Dec 6.78 7.04 6.65 7.50 9.53 9.56 9.56 8.89 10.55 9.23 9.59 10.02 8.78 5.43 12.97 1975—Jan 6.68 6.89 6.39 7.45 9.36 9.45 9.55 8.83 10.62 9.19 9.52 10.10 8.41 5.07 Feb 6.61 6.40 5.96 7.03 8.97 9.09 9.33 8.62 10.43 9.01 9.32 9.83 8.07 4.61 Mar 6.73 6.70 6.28 7.25 9.35 9.38 9.28 8.67 10.29 9.05 9.25 9.67 8.04 4.42 '10.10 Apr 7.03 6.95 6.46 7.43 9.67 9.65 9.49 8.95 10.34 9.30 9.39 9.88 8.27 4.34 May 6.99 6.95 6.42 7.48 9.63 9.65 9.55 8.90 10.46 9.37 9.49 9.93 8.51 4.08 June 6.86 6.96 6.28 7.48 9.25 9.32 9.45 8.77 10.40 9.29 9.40 9.81 8.34 4.02 July 6.89 7.07 6.39 7.60 9.41 9.42 9.43 8.84 10.33 9.26 9.37 9.81 8.24 4.02 Aug 7.06 7.12 6.40 7.71 9.46 9.49 9.51 8.95 10.35 9.29 9.41 9.93 8.41 4.36 Sept 7.29 7.40 6.70 7.96 9.68 9.57 9.55 8.95 10.38 9.35 9.42 9.98 8.56 4.39 Oct 7.29 7.40 6.67 8.01 9.45 9.43 9.51 8.86 10.37 9.32 9.40 9.94 8.58 4.22 Week ending— 1975—Sept. 6.. 7.11 7.29 6.60 7.85 9.41 9.53 10.37 9.32 9.43 9.95 8.48 4.30 13.. 7.25 7.35 6.66 7.91 9.64 9.50 9.54 10.36 9.34 9.43 9.97 8.53 4.42 20.. 7.34 7.45 6.76 8.01 9.68 9.61 9.56 10.39 9.36 9.42 9.99 8.61 4.50 27.. 7.35 7.49 6.79 8.06 9.70 9.70 9.55 10.40 9.36 9.41 10.00 8.61 4.34 Oct. 4.. 7.43 7.62 6.92 8.20 9.72 9.70 9.56 10.39 9.36 9.41 10.01 8.58 4.48 11.. 7.36 7.52 6.80 8.12 9.60 9.56 9.54 10.39 9.35 9.41 10.00 8.66 4.22 18.. 7.31 7.32 6.60 7.92 9.53 9.41 9.52 10.37 9.32 9.40 9.95 8.66 4.15 25.. 7.22 7.18 6.44 7.80 9.32 9.30 9.48 10.36 9.30 9.39 9.90 8.55 4.09 Nov. 1.. 7.18 7.36 6.60 8.00 9.22 9.33 9.46 10.36 9.28 9.38 9.86 8.42 4.14 Number of issues2 1155 2200 5 5 30 41 30 40 14 500 500 1 Includes bonds rated Aa and A, data for which are not shown sep- govt., general obligations only, based on Thurs. figures, from Moody's arately. Because of a limited number of suitable issues, the number Investors Service. (3) Corporate, rates for "New issue" and "Recently of corporate bonds in some groups has varied somewhat. As of Dec. offered" Aaa utility bonds, weekly averages compiled by the Board of 23, 1967, there is no longer an Aaa-rated railroad bond series. Governors of the Federal Reserve System; and rates for seasoned issues, 2 Number of issues varies over time; figures shown reflect most recent averages of daily figures from Moody's Investors Service. count. Stocks: Standard and Poor's corporate series. Dividend/price ratios are based on Wed. figures. Earnings/price ratios as of end of period. NOTE.—Annual yields are averages of weekly, monthly, or quarterly Preferred stock ratio based on 8 median yields for a sample of nondata. callable issues—12 industrial and 2 public utility. Common stock ratios Bonds: Monthly and weekly yields are computed as follows: (1) U.S. on the 500 stocks in the price index. Quarterly earnings are seasonally Govt., averages of daily figures for bonds maturing or callable in 10 years adjusted at annual rates. or more; from Federal Reserve Bank of New York. (2) State and local NOTES TO TABLES ON OPPOSITE PAGE: Security Prices: Stock Market Customer Financing: NOTE.—Annual data are averages of daily or weekly figures. Monthly 1 Margin credit includes all credit extended to purchase or carry stocks and weekly data are averages of daily figures unless otherwise noted and are or related equity instruments and secured at least in part by stock (Dec. computed as follows: U.S. Govt, bonds, derived from average market 1970 BULLETIN, p. 920). Credit extended by brokers is end-of-month data yields in table on p. A-28 on basis of an assumed 3 per cent, 20-year for member firms of the New York Stock Exchange. June data for banks bond. Municipal and corporate bonds, derived from average yields as are universe totals; all other data for banks represent estimates for all computed by Standard and Poor's Corp., on basis of a 4 per cent, 20- commercial banks based on reports by a reporting sample, which acyear bond; Wed. closing prices. Common stocks, derived from com- counted for 60 per cent of security credit outstanding at banks on June 30, ponent common stock prices. Average daily volume of trading, presently 1971. conducted 5 days per week for 6 hours per day. 2 In addition to assigning a current loan value to margin stock generally, Regulations T and U permit special loan values for convertible bonds and stock acquired through exercise of subscription rights. 3 Nonmargin stocks are those not listed on a national securities exchange and not included on the Federal Reserve System's list of over the counter margin stocks. At banks, loans to purchase or carry nonmargin stocks are unregulated; at brokers, such stocks have no loan value. 4 Free credit balances are in accounts with no unfulfilled commitments to the brokers and are subject to withdrawal by customers on demand. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • SECURITY MARKETS A 29 SECURITY PRICES Common stock prices Volume of BBBooonnnddd ppprrriiiccceeesss New York Stock Exchange AAAmmmeeerrr--- trading in (((pppeeerrr ccceeennnttt ooofff pppaaarrr))) iiicccaaannn stocks SSStttoooccckkk (thousands of PPPPeeeerrrriiiioooodddd Standard and Poor's index New York Stock Exchange index EEExxx--- shares) (1941_43= 10) (Dec. 31, 1965 = 50) ccchhhaaannngggeee tttoootttaaalll iiinnndddeeexxx ( G t l U e o o r . n m v S g t . ) , - S l a o t n c a d a te l p A C o A r o a r A t - e Total In tr d i u al s - R ro a a i d l- P u u ti b li l t i y c Total In tr d i u al s - T p t o r i a r o n t n a s - - Utility na F n i- ce 111 ((( 999 AAA 111 333 777 000 111 uuu 333 000 ,,, ggg ))) === ... NYSE AMEX 1970 60.52 72.3 61.6 83.22 91.29 32.13 54.48 45.72 48.03 32.14 37.24 54.64 96.63 10,532 3,376 1971 67.73 80.0 65.0 98.29 108.35 41.94 59.33 54.22 57.92 44.35 39.53 70.38 113.40 15,381 4,234 1972. 68.71 84.4 65.9 109.20 121.79 44.11 56.90 60.29 65.73 50.17 38.48 78.35 129.10 16,487 4,447 1973 62.80 85.4 63.7 107.43 120.44 38.05 53.47 57.42 63.08 37.74 37.69 70.12 103.80 16,374 3,004 1974 57.45 76.3 58.8 82.85 92.91 37.53 38.91 43.84 48.08 31.89 29.82 49.67 79.97 13,883 1 ,908 1974-—Oct 55.69 72.7 55.9 69.44 77.57 33.70 33.80 36.62 39.81 27.26 26.76 39.28 66.78 16,396 1,880 Nov 57.80 72.6 56.3 71.74 80.17 35.95 34.45 37.98 41.24 28.40 27.60 41.89 63.72 14,341 1,823 Dec 58.96 68.6 56.1 67.07 74.80 34.81 32.85 35.41 38.32 26.02 26.18 39.27 59.88 15,007 2,359 1975-—Jan 59.70 70.9 56.4 72.56 80.50 37.31 38.19 38.56 41.29 28.12 29.55 44.85 68.31 19,661 2,117 Feb 60.27 74.1 56.6 80.10 89.29 37.80 40.37 42.48 46.00 30.21 31.31 47.59 76.08 22,311 2,545 Mar 59.33 70.9 56.2 83.78 93.90 38.35 39.55 44.35 48.63 31.62 31.04 47.83 79.15 22,680 2,665 Apr 57.05 69.5 55.8 84.72 95.27 38.55 38.19 44.91 49.74 31.70 30.01 47.35 82.03 20,334 2,302 May 57.40 69.6 56.6 90.10 101 .05 38.92 39.69 47.76 53.22 32.28 31 .02 49.97 86.94 21,785 2,521 June 58.33 69.8 56.7 92.40 103.68 38.97 43.65 49.21 54.61 30.79 32.78 52.20 90.57 '21,286 2,743 July 58.09 68.5 56.6 92.49 103.84 38.04 43.67 49.54 54.96 32.88 32.98 52.51 93.28 20,076 2,750 Aug 56.84 68.3 55.6 85.71 96.21 35.13 41 .04 45.71 50.71 30.14 31 .02 46.55 85.74 13,404 1,476 Sept 55.23 66.1 55.8 84.62 94.96 34.94 40.53 44.97 50.05 29.46 30.65 43.38 84.26 12,717 1,439 Oct 55.23 66.1 56.0 88.57 99.29 36.92 42.59 46.87 52.26 30.79 31 .87 44.36 83.46 15,893 1,629 Week ending— 1975-—Oct. 4. , , , 54.25 64.6 55.1 83.77 94.48 35.15 40.71 44.69 49.78 29.41 30.63 41.98 83.00 13,564 1,376 11 54.69 65.2 55.7 87.63 98.31 36.41 41 .70 46.36 51 .81 30.39 31.17 43.60 83.94 15,890 1,518 18 55.09 66.5 56.2 89.24 100.03 37.21 42.93 47.25 52.66 31 .07 31 .97 45.41 83.98 16,196 1,516 25 55.71 67.5 56.5 90.43 101.34 37.76 43.61 47.85 53.29 31 .48 32.63 45.62 83.43 17.226 1,600 Nov. 1 55.96 66.4 56.6 89.60 100.40 37.39 43.25 47.38 52.80 31.09 32.47 44.34 83.02 15,338 1,484 For notes see opposite page. STOCK MARKET CUSTOMER FINANCING (In millions of dollars) Margin credit at brokers and banks ] Regulated : Unregulated 3 Free credit balances at brokers 4 End of period By source By type Margin stock Convertible Subscription Nonmargin bonds issues stock Total Brokers Banks credit at banks Brokers Banks Brokers Banks Brokers Banks Margin Cash accts. accts. 1974—Sept.. '5,097 '4,173 924 '4,020 881 148 31 12 2,060 437 1,354 Oct.. '5,026 '4,110 916 '3,930 872 145 32 12 2,024 431 1,419 Nov.. '4,994 '4,103 891 '3,960 851 139 29 11 2,054 410 1,447 Dec.. '4,836 '3,980 856 '3,840 815 137 30 11 2,064 411 1,424 1975—Jan... '4,934 '4,086 848 '3,950 806 134 29 13 1,919 410 1,446 Feb.. '5,099 '4,269 830 '4,130 783 136 34 13 1,897 478 1,604 Mar.. '5,164 '4,320 844 '4,180 800 134 30 14 1,882 515 1,770 Apr.. '5,327 '4,503 824 '4,360 781 138 30 13 1,885 505 1,790 May. '5,666 '4,847 819 '4,700 779 140 27 13 1,883 520 1 ,705 June. '5,140 '4,990 146 519 1,790 July.. '5,446 '5,300 143 557 1 ,710 Aug.. 5,365 5,220 142 516 1,500 Sept.. 5,399 5,250 145 472 1,455 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 30 STOCK MARKET CREDIT; SAVINGS INSTITUTIONS • NOVEMBER 1975 EQUITY STATUS OF MARGIN ACCOUNT DEBT SPECIAL MISCELLANEOUS ACCOUNT BALANCES AT BROKERS AT BROKERS, BY EQUITY STATUS OF ACCOUNTS (Per cent of total debt, except as noted) (Per cent of total, except as noted) TToottaall Equity class (per cent) Equity class of accounts ddeebbtt in debit status EEnndd ooff ll (( ii mm oonn iill ss -- End of period c N re e d t i t b T al o a t n al c e ppeerriioodd dd oo oo ff ll -- 8 m 0 o r o e r 70-79 60-69 50-59 40-49 Un 4 d 0 er status 60 o r p e m r o c r e e n t 6 L 0 e p ss e r th c a e n n t of ( m d i o l l li l o ar n s s ) llaarrss))!! 1974—Aug 39.9 34.0 26.0 6,783 1974—Aug.. 4,590 3.5 4.0 6.6 11.2 18.4 56.3 Sept 40.7 31.2 27.0 7,005 Sept.. 4,090 3.5 3.9 6.1 10.2 18.0 58.3 Oct 40.9 35.1 24.0 7,248 Oct... 4,000 4.6 5.5 9.4 16.8 27.3 36.4 40.0 34.6 25.3 6,926 Nov.. 4,040 4.2 5.1 8.5 14.8 24.4 42.8 Dec 41. 1 32.4 26.5 7,013 Dec.. 3,910 4.3 4.6 8.8 13.9 23.0 45.4 1975—Jan 41.1 39.3 19.8 7,185 1975—Jan. . r3,950 5.6 7.3 13.5 24.6 28.1 21.2 Feb 42.2 40.1 17.8 7,303 Feb.. r4,130 5.9 7.2 14.6 25.4 28.5 18.4 44.4 40.1 15.5 7,277 Mar.. r4,180 6.5 8.0 15.3 27.6 25.8 16.9 45.2 41 .1 13.7 7,505 Apr.. r4,360 7.1 8.7 16.1 28.7 23.5 15.9 May 44.5 43.2 12.3 7,601 May. r4,700 7.0 9.1 16.7 31.5 21 .0 13.4 June 45.9 43.1 11.0 7,875 June. '4,990 7.4 9.9 18.3 32.7 20.4 11.4 July 45.6 41.1 13.1 7,772 July.. r5,300 6.0 8.3 13.9 23.6 30.4 17.9 43.5 40.6 16.0 7,494 Aug.. 5.220 5.5 6.8 11.3 20.7 31.0 24.7 Sept 45.3 38.9 15.8 7,515 Sept.. 5.250 5.1 7.3 10.6 19.6 31.0 26.5 NOTE.—Special miscellaneous accounts contain credit balances that 1 Note 1 appears at the bottom of p. A-28. may be used by customers as the margin deposit required for additional purchases. Balances may arise as transfers based on loan values of other NOTE.—Each customer's equity in his collateral (market value of col- collateral in the customer's margin account or deposits of cash (usually lateral less net debit balance) is expressed as a percentage of current col- sales proceeds) occur. lateral values. MUTUAL SAVINGS BANKS (In millions of dollars) Securities Total Mortgage loan assets— commitments 2 State Corpo- Cash Other li T a o b t il a i l - Depos- l O ia t b h i e li r - G re e s n e e r r v a e l classi ( f i i n e d m b o y n t m h a s) t urity End of period Mort- U.S. and rate assets ties its ties gage Other Govt. g lo o c v a t l . ot a h n e d r 1 ge a n n e d r al reserve accts. 3 or 3-6 Over Total less 9 1971 62,069 2,808 3,334 385 17,674 1,389 1,711 89,369 81,440 1,810 6,118 1,047 627 463 1,310 3,447 19723 67,563 2,979 3,510 873 21,906 1,644 2,117 100,593 91,613 2,024 6,956 1,593 713 609 1,624 4,539 197 3 73,231 3,871 2,957 926 21,383 1.968 2,314 106,651 96,496 2,566 7.589 1,250 598 405 1,008 3,261 197 4 74,891 3,812 2,555 930 22,550 2,167 2,645 109,550 98,701 2,888 7,961 664 418 232 726 2,040 1974—Aug.. 74,724 4,031 2,604 879 22,292 1,334 2,519 108,383 97,067 3,475 7,841 949 496 417 977 2,839 Sept.. 74,790 4,087 2,574 876 22,218 1,303 2,573 108,420 97,425 3,089 7,906 932 382 450 904 2,668 Oct... 74,835 3,981 2,525 870 22,190 1,303 2,608 108,313 97,252 3,158 7,904 775 374 360 792 2,301 Nov... 74,913 4,226 2,553 877 22,201 1,406 2,633 108,809 97,582 3,291 7,936 724 398 317 743 2,182 Dec... 74,891 3,812 2,555 930 22,550 2,167 2,645 109,550 98,701 2,888 7,961 664 418 232 726 2,040 1975—Jan... 74,957 4,287 2,571 967 22,979 1,706 2,663 110,130 99,211 2,948 7,971 726 400 225 620 1,971 Feb. . 75,057 4,658 2,677 1 ,017 23,402 1 ,856 2,709 111,376 100,149 3,211 8,016 654 360 217 579 1 ,810 Mar.. 75,127 4,736 2,975 1,095 24,339 2,101 2,672 113,045 102,285 2,712 8,049 824 312 294 564 1,994 Apr... 75,259 4,407 3,419 1,121 24,994 1,841 2,780 113,821 102,902 2,849 8,071 913 335 312 538 2,098 May.. 75,440 4,593 3,616 1,137 25,579 2,077 2,811 115,252 104,056 3,080 8,116 955 383 300 573 2,211 June.. 75,763 4,492 3,744 1,240 26,470 2,088 2,954 116,751 105,993 2,594 8,164 973 510 195 565 2,243 July.. 76,097 4,396 3,965 1,436 26,976 1 ,835 3,004 117,709 106,533 2,970 8,208 957 463 266 526 2,212 Aug... 76,310 4,405 4,187 1,451 27,104 1,730 3,067 118,254 106,745 3,255 8,254 981 431 237 573 2,222 1 Also includes securities of foreign governments and international were net of valuation reserves. For most items, however, the differences organizations and nonguaranteed issues of U.S. Govt, agencies. are relatively small. 2 Commitments outstanding of banks in New York State as reported to the Savings Banks Assn. of the State of New York. Data include building NOTE.—NAMSB data; figures are estimates for all savings banks in loans. the United States and differ somewhat from those shown elsewhere in 3 Balance sheet data beginning 1972 are reported on a gross-of-valua- the BULLETIN; the latter are for call dates and are based on reports filed tion-reserves basis. The data differ somewhat from balance sheet data with U.S. Govt, and State bank supervisory agencies. previously reported by National Assn. of Mutual Savings Bank, which Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • SAVINGS INSTITUTIONS A 31 LIFE INSURANCE COMPANIES (In millions of dollars) Government securities Business securities End of period aa TT ss oo ss tt ee aa tt ll ss Total U S n ta i t t e e s d Sta lo te c a a l n d Foreign1 Total Bonds Stocks MM ggaa oo gg rr ee tt ss -- ee RR sstt ee aa aa tt ll ee PP lloo oo aa llii nn cc ss yy O as t s h e e t r s 197 1 222,102 11,000 4,455 3,363 3,182 99,805 79,198 20,607 75,496 6,904 17,065 11,832 197 2 239,730 11,372 4,562 3,367 3,443 112,985 86,140 26,845 76,948 7,295 18,003 13,127 197 3 252,436 11,403 4,328 3,412 3,663 117,715 91,796 25,919 81,369 7,693 20,199 14,057 197 4 263,817 11,890 4,396 3,653 3,841 119,580 97,430 22,150 86,258 8,249 22,899 14,941 1974—Aug. 258,508 11,789 4,365 3,603 3,821 118,319 96,076 22,243 84,082 8,037 21,867 14,414 Sept. 258,116 11,762 4,316 3,618 3,828 116,884 96,162 20,722 84,427 8,100 22,175 14,768 Oct.. 261,183 11,804 4,344 3,620 3,840 119,225 96,815 22,410 85,016 8,140 22,473 14,525 Nov. 262,253 11,871 4,394 3,626 3,851 119,246 97,199 22,047 85,481 8,207 22,676 14,772 Dec. 263,349 11,965 4,437 3,667 3,861 118,572 96,652 21,920 86,234 8,331 22,862 15,385 1975—Jan.. 266,823 12,065 4,461 3,669 3,935 121,986 98,876 23,110 86,526 8,313 23,058 14,875 Feb. 269,715 12,161 4,512 3,686 3,960 124,158 99,571 24,587 86,929 8,402 23,224 14,841 Mar. 272,143 12,338 4,581 3,712 4,045 125,512 100,116 25,396 87,187 8,582 23,391 15,133 Apr. 273,523 12,374 4,608 3,719 4,047 126,256 99,725 26,531 87,638 8,782 23,459 15,014 May 275,816 12,464 4,678 3,739 4,047 127,847 100,478 27,369 87,882 8,843 23,570 15,210 June 278,343 12,560 4,738 3,762 4,060 129,838 101,238 28,600 88,035 8,989 23,675 15,246 July. 279,354 12,814 4,843 3,902 4,069 130,298 102,675 27,623 88,162 9,058 23,794 15,228 Aug. 280,482 13,022 4,895 4.039 4,088 130,659 103,496 27,163 88,327 9.112 23,919 15,443 1 Issues of foreign governments and their subdivisions and bonds of Figures are annual statement asset values, with bonds carried on an the International Bank for Reconstruction and Development. amortized basis and stocks at year-end market value. Adjustments for interest due and accrued and for differences between market and book NOTE.—Institute of Life Insurance estimates for all life insurance values are not made on each item separately but are included, in total in companies in the United States. "Other assets." SAVINGS AND LOAN ASSOCIATIONS (In millions of dollars) Liabilities MMoorrttggaaggee Total llooaann ccoomm-- End of period M ga o g r e t s - I s i n m e t v i c e e e u s n s r t 1 t - - Cash Other l a ia s T b s o e il t t i a s t — l i es S c a a v p i i n ta g l s w N or e t t h 2 m ro o B w n o e e r y - d 3 p L ro o i c n a e n s s s Other oouu m a m a pp tt tt ss ii ee tt ee tt rr mm aa nn ii nn dd oo ee dd dd nn ii oo 44 tt nn ss ff gg 1971 174,250 18,185 2,857 10,731 206,023 174,197 13,592 8,992 5,029 4,213 7,328 1972... 206,182 21,574 2,781 12,590 243,127 206,764 15,240 9,782 6,209 5,132 11,515 19735 231,733 21,055 19,117 271,905 226,968 17,056 17,172 4,667 6,042 9,526 1974r 249,293 23,240 22,991 295,524 242,959 18,436 24,780 3,244 6,105 7,454 1974—Sept.. 247,612 21,172 22,687 291,471 237,911 18,201 24,104 4,253 7,002 9.126 Oct... 248,177 22,132 22,940 293,249 238,338 18,444 24,508 3,840 8,119 8.127 Nov.. 248,699 23,255 23,222 295,176 239,567 18,675 24,510 3,479 8,945 7,723 Dec... 249,293 23,240 22,991 295,524 242,959 18,436 24,780 3,244 6,105 7,454 1975—Jan... 249,719 25,390 23,252 298,361 246,227 18,586 23,355 3,057 7,136 7,887 Feb... 250,828 27,003 23,669 301,500 249,524 18,816 21,895 3,049 8,216 8,787 Mar.. 252,442 28,304 24,210 304,956 256,017 18,654 20,373 3,275 6,637 10,050 Apr... 254,727 29,047 24,868 308,642 258,875 18,882 19,845 3,608 7,432 11,653 May.. 257,911 30,648 25,520 314,079 262,770 19,128 19,317 4,105 8,759 12,557 June.. 261,336 30,880 25,786 318,003 268,978 18,992 18,881 4,446 6,706 12,363 July.. 264,458 32,054 26,311 322,823 272,032 19,266 18,765 4,771 7,989 12,611 Aug.. 267,717 31,694 27,127 326,538 273,504 19,495 19,237 4,995 9,307 12,673 Sept.f 270,583 30,809 27,701 329,093 277,194 19,410 20,068 5,109 7,312 12,566 1 Excludes stock of the Federal Home Loan Bank Board. Compensating in other assets. The effect of this change was to reduce the mortgage changes have been made in "Other" assets. total by about $0.6 billion. 2 Includes net undistributed income, which is accrued by most, but not Also, GNMA-guaranteed, mortgage-backed securities of the passall, associations. through type, previously included in "Cash" and "Investment securities" 3 Advances from FHLBB and other borrowing. are included in "Other" assets. These amounted to about $2.4 billion at 4 Data comparable with those shown for mutual savings banks (on the end of 1972. opposite page) except that figures for loans in process are not included above but are included in the figures for mutual savings banks. NOTE.—FHLBB data; figures are estimates for all savings and loan 5 Beginning 1973, participation certificates guaranteed by the Federal assns. in the United States. Data are based on monthly reports of insured Home Loan Mortgage Corporation, loans and notes insured by the assns. and annual reports of noninsured assns. Data for current and Farmers Home Administration, and certain other Govt.-insured mortgage- preceding year are preliminary even when revised. type investments, previously included in mortgage loans, are included Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 32 FEDERAL FINANCE • NOVEMBER 1975 FEDERAL FISCAL OPERATIONS: SUMMARY (In millions of dollars) U.S. budget Means of financing Borrowings from the public Less: Cash and monetary assets Other means Period Surplus Less: Invest- Receipts Outlays or Public ments by Govt, Trea- financdeficit debt Agency accounts * Less: Equals: sury ing, (-) securi- securi- Special Total operat- Other net 3 ties ties notes 2 ing Special Other balance issues Fiscal year: 197 2 208,649 231,876 -23,227 29,131 -1,269 6,796 1,623 19,442 1,362 1,108 c6,255 197 3 232,225 246,526 -14,301 30,881 216 11,712 109 19,275 2,459 -1,613 -4,129 1 1 9 9 7 7 4 5 2 28 6 0 4 , , 9 9 9 3 7 2 2 3 6 2 8 4 , ,6 3 0 9 1 2 - - 4 3 3 , , 4 6 6 0 0 4 5 1 8 6 , , 9 9 5 1 3 8 -1,0 9 6 0 9 3 1r8 3 , , 1 6 1 73 2 -1 1 , ,1 0 4 8 0 1 5 3 0 , , 0 8 0 5 9 3 - - 3 1 , , 4 5 1 7 7 0 1 c8 ,8 8 9 9 1 ' c - - 6 2 , , 9 0 2 7 8 7 Half year: 1973—July-Dec. 124,256 130,362 -6,106 11,756 478 5,376 845 6,014 -2,202 -319 -2,429 1974—Jan.-June 140,676 138,032 2,647 5,162 426 8,297 295 -3,004 -1,215 1,089 231 July-Dec. 139,807 153,399 -13,591 18,429 -646 2,840 150 14,794 -3,228 248 -4.183 1975—Jan.-June 141,190 171,202 -30,012 40,524 -423 '5,272 -1,231 36,059 1 ,658 1 ,643 -2,746 Month: 1974—Sep t 28,377 24,712 3,666 -326 -167 -1,311 250 569 3,244 797 -194 Oct 19,633 26,460 -6,827 -1,242 -242 -2,053 -152 721 -6,445 -338 -677 Nov 22,292 24,965 -2,673 5,139 -17 653 -31 4,500 816 96 -915 Dec 24,946 27,442 -2,496 7,300 -38 2,276 -90 5,077 2,874 268 561 1975—Ja n 25,020 28,934 -3,914 1,475 -23 -2,173 -42 3,667 -58 319 508 Feb 19,975 26,200 -6,225 5,571 -306 1,224 -495 4,535 -2,359 -132 -801 Mar 20,134 27,986 -7,852 9,949 5 -1,216 -79 11,249 3,115 285 3 Apr 31,451 29,601 1 ,850 7,081 -37 10 -451 7,485 7,666 1 ,847 178 May 12,793 28,186 -15,394 11 ,418 -6 3,296 -440 8,556 -5,757 -732 349 June 31,817 30,296 1,521 5,030 -55 4,131 276 567 -949 56 -2,981 July 20,197 31,249 -11,052 5,051 -23 -2,427 -346 7,800 -3,390 -1,373 -1,511 Aug 23,584 30,634 -7,050 9,472 6 2,384 -94 7,189 -630 -263 -1,032 Sept 28,615 29,044 -429 5,935 9 -2,151 -367 8,463 6,961 446 -627 Selected balances Treasury operating balance Borrowing from the public. End Memo: pe o ri f o d B F a . n R k . s ac l c T a o o n a a u d x n n ts d t O a e r p t i h o e e s s r i 4 - Total se P c d u u e b r b i l t t i i c e s s A ec g u e r n it c i y e s G I o n v v t e , s L a tm e c s c e s o : n u ts n ts o f 1 S n L p o e e t c e s s i s a : 2 l E T q o u t a a l l s: s c p p D o G r o N r i e n o p v b o s v s a t w o . t t — r . e o - e s f d Special Other issues Fiscal year: 197 1 1,274 7,372 109 8,755 398,130 12,163 82,740 22,400 825 304,328 37,086 197 2 2,344 c7,634 139 10,117 427,260 10,894 89,536 24,023 825 323,770 41,814 197 3 4,038 8,433 106 12,576 458,142 11,109 101,248 24,133 825 343,045 51,325 197 4 2,919 6,152 88 9,159 475,060 12,012 114,921 25,273 825 346,053 65,411 197 5 5,773 1,475 343 7,591 533,188 10,943 123,033 24,192 (6) 396,906 76,092 Calendar year: 197 3 2,543 7,760 70 10,374 469,898 11,586 106,624 24,978 825 349,058 59,857 197 4 3,113 2,749 70 5,932 492,664 11,367 117,761 25,423 (6) 360,847 Month: 1974—Sept.. .. 3,211 5,384 92 8,687 481,466 11,664 116,885 25,696 350,549 73,068 Oct 789 1,381 71 2,241 480,224 11,422 114,832 25,544 351,270 75,343 Nov.. ., 1,494 1,571 3,066 485,364 11,404 115,485 25,513 355,770 75,706 Dec 3,113 2,745 70 5,928 492,664 11,367 117,761 25,423 360,847 76,459 1975-Ja n 3,541 2,115 220 5,876 494,139 11,343 115,588 25,380 364,514 76,921 Feb r2,885 410 220 r3,515 499.710 11,037 116,812 23,886 369,049 75,964 Mar.. .. r4,271 r2,142 220 '"6,633 509,659 11,042 115,596 24,807 380,298 76,392 Apr '8,364 r5,415 521 r14,299 516,740 11,004 115,606 24,355 387,783 77,124 May r7,040 r984 521 '8,545 528,158 10,998 118,902 23,915 396,339 75,140 June r5,773 rl ,475 343 '7,591 533,188 10,943 123,033 24,192 396,906 76,092 July.... r2,776 r878 544 '4,098 538,240 10,920 120,606 23,847 404,707 77,173 Aug r2,349 1,211 9 3,569 547.711 10,926 122,990 23,752 411,895 76,659 Sept 8,075 2,161 294 10,530 553,647 10,935 120,839 23,385 420,358 1 With the publication of the Oct. 1974 Federal Reserve BULLETIN, taries" (deposits in certain commercial depositaries that have been conthese series have been corrected (beginning in fiscal year 1971) to exclude verted from a time to a demand basis to permit greater flexibility in special issues held by the Federal home loan banks and the General Treasury cash management). Services Adm. Participation Certificate Trust, which are not Govt, ac- 5 Includes debt of Federal home loan banks, Federal land banks, R.F.K. counts. Stadium Fund, FNMA (beginning Sept. 1968), and Federal intermediate 2 Represents non-interest-bearing public debt securities issued to the credit banks and banks for cooperatives (both beginning Dec. 1968). International Monetary Fund and international lending organizations. 6 Beginning July 1974, public debt securities excludes $825 million of New obligations to these agencies are handled by letters of credit. notes issued to International Monetary Fund to conform with Office of 3 Includes net outlays of off-budget Federal agencies, accrued interest Management and Budget's presentation of the budget. payable on public debt securities, deposit funds, miscellaneous liability and asset accounts, and seigniorage. 4 As of Jan. 3, 1972, the Treasury operating balance was redefined to NOTE.—Half years may not add to fiscal year totals due to revisions in exclude the gold balance and to include previously excluded "Other deposi- series that are not yet available on a monthly basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • FEDERAL FINANCE A 33 FEDERAL FISCAL OPERATIONS: DETAIL (In millions of dollars) Budget receipts Individual income taxes Corporation Social insurance taxes income taxes and contributions Period Employment Total Pres. taxes and Excise Cus- Estate Misc. Elec- Non- Gross contribution2 Un- Other taxes toms and re- With- tion with- Re- Net re- Re- empl. net Net gift ceipts4 held Cam- held funds total ceipts funds insur. re- total paign Pay- Self- ceipts3 Fundi roll empl. taxes Fiscal year: 197 2 208,649 83,200 25,679 14,143 94,737 34,926 2,760 44,088 2,032 4,357 3,437 53,914 15,477 3,287 5,436 3,633 197 3 232,225 98,093 27,017 21,866 103,246 39,045 2,893 52,505 2,371 6,051 3,614 64,542 16,260 3,188 4,917 3,921 197 4 264,932 112,092 28 30,812 23,952 118,952 41,744 3,125 62,878 3,008 6,837 4,051 76,780 16,844 3,334 5,035 5,369 197 5 280,997 122,071 '34,328 34,013 122,386 45,747 5,125 71,789 3,417 6,770 4,466 86,441 16,551 3,676 4,611 6,711 Half year: 1973—July-Dec.. 124,256 52,964 6,207 999 58,172 16,589 1,494 29,965 201 2,974 1,967 35,109 8,966 1,633 2,514 2,768 1974—Jan.-June. 140,676 59,100 28 24,605 22,953 60,782 25,155 1,631 32,919 2,807 3,862 2,084 41,671 7,878 1 ,701 2,521 2,601 July-Dec.. 139,807 61,377 7,099 1,016 67,460 18,247 2,016 34,418 254 2,914 2,187 39,774 8,761 1.958 2,284 3,341 1975—Jan.-June. 141,190 60,694 27.198 32,997 54,926 27,500 3,109 37,371 3,163 3,856 2,279 46,667 7,790 1,718 2,327 3,370 Month: 1974—Sep t 28,377 '9,755 4,323 130 13,947 6,082 435 5,428 240 62 389 6,119 1,465 305 352 543 Oct 19,633 10,106 561 78 10,590 1,717 511 4,558 221 363 5,142 1,401 347 370 578 Nov 22,292 10,638 305 111 10,832 1,111 314 6,633 762 353 7,748 1 ,474 319 350 773 Dec 24,946 10,428 461 90 10,799 6,458 190 4,982 14 356 5,441 1,489 307 341 301 1975—Ja n 25,020 10,253 5,366 132 15,487 1,745 557 4,802 223 245 402 5,673 1,351 307 385 629 Feb 19,975 10,964 1,046 4,264 7,747 1,275 496 7,670 225 732 352 8,979 1,277 260 399 535 Mar 20,134 '9,624 2,661 8,152 4,134 7,228 649 6,268 208 21 373 6,870 1,160 295 356 741 Apr 31,451 '9,558 12,766 6,258 16,065 5,819 726 5,438 1,743 557 388 8,126 1 ,166 286 317 399 May 12,793 10,300 819 12,749 1,630 1,192 18 7,689 340 2,209 350 10,588 1,373 270 459 559 June 31,817 10,027 "4,541 1,444 13,123 10,241 664 5,552 373 92 413 6,431 1,464 301 412 508 July 20,197 9,205 908 498 9,615 1,838 471 5,309 444 374 6,128 1,514 313 503 757 Aug 23,584 10,246 488 331 10,403 I ,045 425 8,085 1 ,257 372 9,713 1 ,394 302 430 723 Sept 28,615 9,182 4,809 382 13,609 6,277 264 5,555 251 75 400 6,280 1 ,430 312 431 539 Budget outlays5 Gen- Nat- Educa- Gen- Reveral ural Com- tion, eral enue Undis- Na- sci- Agri- re- Com- mun. man- Health Govt., shar. trib. Period Total tional Intl. ence, cul- sources, merce and power, and Vet- Inter- law and offde- affairs space, ture envir., and region. and wel- erans est en- fiscal setting fense and and transp. devel- social fare force., assist- retech. energy opment serv. and ance ceipts6 justice Fiscal year: 1973 246,526 75,072 2,956 4,169 4,855 5,461 9,938 5,869 11,874 91,790 12 ,013 22,813 4,813 77,222 -12,318 1974 268,392 78,569 3,593 4,154 2,230 6,390 1 3,100 4,910 11,600 106,505 13 ,386 28,072 5,789 6,746 -16,652 1975 324,601 88,238 4,198 4,154 1,991 7,921 15,566 4,410 15,110 136,333 16 ,595 31,019 6,464 6,700 -14,098 19768 358,900 94,100 5,500 4,600 2,000 10,300 15,700 6,100 16,800 151,800 17 ,100 34,400 6,500 7,300 -20,000 Month: 1975—Mar 27,986 7,435 503 379 347 723 1 ,415 1,519 1 ,209 12,154 1 ,,8 11 2,656 568 3 -1,236 Apr 29,601 7,555 109 368 275 611 1 ,088 309 1 ,838 12,379 i; ,466 2,716 '416 1 ,524 -1 ,053 May 28,186 8,000 408 384 42 679 995 383 1,647 11,968 i; ,468 2,607 '479 -873 June 30,296 7,854 557 256 179 788 1,289 453 1,684 14,158 i; ,412 2,521 '759 -14 -1,601 July 31,249 7,307 531 476 270 821 2,256 402 1,237 13,092 i, ,367 2,637 '593 1,625 -1,094 Aug 30,634 8,229 448 402 117 770 2,165 568 1 ,690 12,431 i; ,447 2,672 '553 213 -1 ,071 Sept 29,044 6,923 47 398 507 844 1,899 453 1,684 12,738 i; ,334 2,859 548 4 -1,068 1 Collections of these receipts, totaling $2,427 million for fiscal year 6 Consists of interest received by trust funds, rents and royalties on the 1973, were included as part of nonwithheld income taxes prior to Feb. Outer Continental Shelf, and Govt, contributions for employee retirement. 1974. 7 Contains retroactive payments of $2,617 million for fiscal 1972. 2 Old-age, disability, and hospital insurance, and Railroad Retirement 8 Estimates presented in Mid-Session Review of the 1976 Budget, May accounts. 30, 1975. Breakdowns do not add to totals because special allowances for 3 Supplementary medical insurance premiums and Federal employee contingencies, civilian agency pay raises, and energy tax equalization payretirement contributions. ments totaling $6,800 million for fiscal 1976 are not included. 4 Deposits of earnings by F. R. Banks and other miscellaneous receipts. 5 Budget outlays reflect the new functional classification of outlays presented in the 1976 Budget. For a description of these functions, see NOTE.—Half years may not add to fiscal year totals due to revisions in Budget of the U.S. Government, Fiscal Year 1976, pp. 64-65. series that are not yet available on a monthly basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 34 U.S. GOVERNMENT SECURITIES • NOVEMBER 1975 GROSS PUBLIC DEBT, BY TYPE OF SECURITY (In billions of dollars) Public issues (interest-bearing) End of period p d T g u e r o b b o t t l s a i s l c i Total Total Bills Ma C r c e k a r e t t e i t f s a i b - le Bonds 2 b C v i o e b o n r l n e t d - - s Total N 3 onm F is o s a r u r e e k i s c g t n 4 a ble S b a o a v n n i d n d s g s i S s p su e e c s i a 3 l notes 1968—Dec. 358.0 296.0 236.8 75.0 76.5 85.3 2.5 56.7 4.3 52.3 59.1 1969—Dec. 368.2 295.2 235.9 80.6 85.4 69.9 2.4 56.9 3.8 52.2 71.0 1970—Dec. 389.2 309.1 247.7 87.9 101.2 58.6 2.4 59.1 5.7 52.5 78.1 1971—Dec.. 424.1 336.7 262.0 97.5 114.0 50.6 2.3 72.3 16.8 54.9 85.7 1972—Dec. 449.3 351.4 269.5 103.9 121.5 44.1 2.3 79.5 20.6 58.1 95.9 1973—Dec. 469.9 360.7 270.2 107.8 124.6 37.8 2.3 88.2 26.0 60.8 107.1 1974—Oct. 480.2 363.9 273.5 112.1 127.7 33.8 2.3 88.1 23.1 63.3 115.3 Nov. 485.4 368.2 277.5 114.6 129.6 33.3 2.3 88.4 23.1 63.6 115.9 Dec. 492.7 373.4 282.9 119.7 129.8 33.4 2.3 88.2 22.8 63.8 118.2 1975—Jan.. 494.1 377.1 286.1 120.0 131.8 33.3 2.3 88.8 23.0 64.2 116.0 Feb. 499.7 381.5 289.8 123.0 132.7 34.1 2.3 89.4 23.3 64.5 117.2 Mar. 509.7 392.6 300.0 124.0 141.9 34.1 2.3 90.4 24.0 64.8 116.0 Apr. 516.7 399.8 307.2 127.0 145.0 35.3 2.3 90.3 23.6 65.2 116.0 May 528.2 407.8 314.9 131.5 146.5 36.8 2.3 90.6 23.5 65.5 119.2 June 533.2 408.8 315.6 128.6 150.3 36.8 2.3 90.9 23.2 65.9 123.3 July. 538.2 416.3 323.7 133.4 153.6 36.7 2.3 90.4 22.2 66.3 120.9 Aug. 547.7 423.5 331.1 138.1 155.2 37.8 2.3 90.1 21.6 66.6 123.3 Sept. 553.6 431 .5 338.9 142.8 158.5 37.7 2.3 90.3 21 .5 66.9 121 .1 Oct., 562.0 443.6 350.9 147.1 166.3 37.6 2.3 90.5 21 .2 67.2 117.4 1 Includes non-interest-bearing debt (of which $614 million on Oct. 31, 4 Nonmarketable certificates of indebtedness, notes, and bonds in the 1975, was not subject to statutory debt limitation). Treasury foreign series and foreign-currency-series issues. 2 Includes Treasury bonds and minor amounts of Panama Canal and 5 Held only by U.S. Govt, agencies and trust funds and the Federal postal savings bonds. home loan banks. 3 Includes (not shown separately): despositary bonds, retirement plan bonds, Rural Electrification Administration bonds, State and local govern- NOTE.—Based on Monthly Statement of the Public Debt of the United ment bonds, and Treasury deposit funds. States, published by U.S. Treasury. See also second paragraph in NOTE to table below. OWNERSHIP OF PUBLIC DEBT (Par value, in billions of dollars) Held by- Held by private investors E pe n r d i o o d f p T g d u r o e b o t b l s a t i s l c ag G t U e a r o n n u . v S c d s t t i . , e s B F a . n R k . s Total m C b e a o r n c m k i - a s l s M b a a v u n i t n u k g a s s l p I c a n a o n s n m c u i e e r - - s r c O a o t t r i h p o e o n r - s g S l a o o t n c v a d a t t e s l . Savi I n n g d s i v idu O a t ls h er n F a i o t n a i r o t n e e d n i r g a - n l 1 t O i m o n r t v i s h s e c e s 2 . r funds bonds securities 1968—Dec 358.0 76.6 52.9 228.5 66.0 3.8 8.4 14.2 24.9 51.9 23.3 14.3 21.9 1969—Dec 368.2 89.0 57.2 222.0 56.8 3.1 7.6 10.4 27.2 51.8 29.0 11.2 25.0 1970—Dec 389.2 97.1 62.1 229.9 62.7 3.1 7.4 7.3 27.8 52.1 29.1 '20.6 19.9 1971—Dec 424.1 106.0 70.2 247.9 65.3 3.1 7.0 11.4 25.4 54.4 18.8 46.9 15.6 1972—Dec 449.3 116.9 69.9 262.5 67.7 3.4 6.6 9.8 28.9 57.7 16.2 55.3 17.0 1973—Dec 469.9 129.6 78.5 261.7 60.3 2.9 6.4 10.9 29.2 60.3 16.9 55.6 19.3 1974—Aug 481.8 141.6 81.1 259.0 53.1 2.6 5.7 11.0 29.2 62.3 20.3 56.0 18.9 Sept 481.5 140.6 81.0 259.8 52.0 2.5 5.7 10.5 29.3 62.5 20.8 56.0 20.6 Oct 480.2 138.4 79.4 262.5 52.7 2.5 5.9 11.2 28.8 62.8 21.0 56.6 21 .1 Nov 485.4 139.0 81.0 265.3 53.7 2.5 5.9 11.0 28.7 63.2 21.1 58.3 20.8 Dec 492.7 141.2 80.5 271.0 55.6 2.5 6.1 11 .0 29.2 63.4 21 .5 58.4 23.2 1975—Jan 494.1 139.0 81.3 273.8 54.6 2.6 6.2 11.3 30.0 63.7 21.6 61 .5 22.3 Feb 499.7 139.8 81.1 278.9 56.5 2.7 6.2 11 .4 30.5 64.0 21.3 64.6 21 .6 Mar 509.7 138.5 81.4 289.8 61 .8 2.9 6.6 12.0 29.7 64.4 21.4 65.0 26.1 Apr 516.7 138.0 87.8 290.9 64.1 3.2 6.7 12.5 29.8 64.7 21.4 64.9 23.6 May 528.2 140.9 85.6 301.7 67.7 3.4 6.9 13.7 29.8 65.1 21.5 66.8 26.8 June 533.2 145.3 84.7 303.2 69.2 3.5 7.1 13.2 29.6 65.5 21.6 66.0 27.4 July 538.2 142.5 81.9 313.8 71 .4 3.7 7.3 16.2 31.3 65.9 21.8 66.7 29.5 Augp 547.2 144.8 82.5 320.4 75.4 3.9 7.4 16.0 31 .2 66.2 22.6 67.3 30.5 1 Consists of investments of foreign and international accounts in The debt and ownership concepts were altered beginning with the the United States. Mar. 1969 BULLETIN. The new concepts (1) exclude guaranteed se- 2 Consists of savings and loan assns., nonprofit institutions, cor- curities and (2) remove from U.S. Govt, agencies and trust funds porate pensions trust funds, and dealers and brokers. Also included and add to other miscellaneous investors the holdings of certain are certain Govt, deposit accounts and Govt.-sponsored agencies. Govt.-sponsored but privately owned agencies and certain Govt, deposit NOTE.—Reported data for F.R. Banks and U.S. Govt, agencies and accounts. Beginning in July 1974, total gross public debt includes Federal trust funds; Treasury estimates for other groups. Financing Bank bills and excludes notes issued to the IMF ($825 million). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • U.S. GOVERNMENT SECURITIES A 35 OWNERSHIP OF MARKETABLE SECURITIES, BY MATURITY (Par value, in millions of dollars) VV ithin 1 yea:r 1-5 5-10 10-20 Over Type of holder and date Total years years years 20 years Total Bills Other All holders: 1972—Dec. 31 269,509 130,422 103,870 26,552 88,564 29,143 15,301 6,079 1973—Dec. 31 270,224 141,571 107,786 33,785 81,715 25,134 15,659 6,145 1974—Dec. 31 282,891 148,086 119,747 28,339 85,311 27,897 14,833 6,764 1975—Aug. 31 331,080 175,467 138,086 37,381 106,272 25,443 14,431 9,467 Sept. 30 338,946 180,165 142,803 37,362 109,540 25,436 14,370 9,435 U.S. Govt, agencies and trust funds: 1972—Dec. 31 19,360 1,609 674 935 6,418 5,487 4,317 1,530 1973—Dec. 31 20,962 2,220 631 1,589 7,714 4,389 5,019 1,620 1974—Dec. 31 21,391 2,400 588 1,812 7,823 4,721 4,670 1,777 1975—Aug. 31 20,088 3,106 409 2,697 6,692 4,050 4,233 2,006 Sept. 30 19,702 2,883 241 2,642 6,632 3,951 4,233 2,002 Federal Reserve Banks: 1972 Dec. 31 69,906 37,750 29,745 8,005 24,497 6,109 1,414 136 1973—Dec. 31 78,516 46,189 36,928 9,261 23,062 7,504 1,577 184 1974—Dec. 31 80,501 45,388 36,990 8,399 23,282 9,664 1,453 713 1975—Aug. 31 82,546 42,790 34,085 8,705 30,404 5,782 1 ,460 2,111 Sept. 30 86,998 46,641 37,559 9,082 30,685 5,971 1 ,490 2,210 Held by private investors: 1972—Dec. 31 180,243 91,063 73,451 17,612 57,649 17,547 9,570 4,413 1973—Dec. 31 170,746 93,162 70,227 22,935 50,939 13,241 9,063 4,341 1974—Dec. 31 180,999 100,298 82,168 18,130 54,206 13,512 8,710 4,274 1975—Aug. 31 228,446 129,571 103,592 25,979 69,176 15,611 8,738 5,350 Sept. 30 232,246 130,641 105,003 25,638 72,223 15,514 8,647 5,223 Commercial banks: 1972—Dec. 31 52,440 18,077 10,289 7,788 27,765 5,654 864 80 1973—Dec. 31 45,737 17,499 7,901 9,598 22,878 4,022 1,065 272 1974—Dec. 31 42,755 14,873 6,952 7,921 22,717 4,151 733 280 1975—Aug. 31 57,763 22,833 12,166 10,667 29,955 4,077 614 286 Sept. 30 60,459 24,943 14,023 10,920 30,637 3,994 622 263 Mutual savings banks: 1972—Dec. 31 2,609 590 309 281 1,152 469 274 124 1973—Dec. 31 1,955 562 222 340 750 211 300 131 1974—Dec. 31 1,477 399 207 192 614 174 202 88 1975—Aug. 31 2,771 594 248 346 1 ,383 448 233 113 Sept. 30 2,882 651 317 334 1,447 437 232 115 Insurance companies: 1972—Dec. 31 5,220 799 448 351 1,190 976 1,593 661 1973—Dec. 31 4,956 779 312 467 1,073 1,278 1,301 523 1974—Dec. 31 4,741 722 414 308 1,061 1,310 1,297 351 1975—Aug. 31 5,864 912 505 407 1 ,717 1 ,716 1,148 371 Sept. 30 6,085 945 529 416 1 ,836 1 ,781 1 ,151 372 Nonfinancial corporations: 1972—Dec. 31 4,948 3,604 1,198 2,406 1,198 121 25 1 1973—Dec 31 4,905 3,295 1,695 1,600 1,281 260 54 15 1974—Dec. 31 4,246 2,623 1,859 764 1,423 115 26 59 1975—Aug. 31 6,652 4,304 3,521 783 2,034 217 72 25 Sept. 30 5,904 3,799 3,017 782 1,856 160 64 25 Savings and loan associations: 1972—Dec. 31 2,873 820 498 322 1,140 605 226 81 1973—Dec. 31 2,103 576 121 455 1,011 320 151 45 1974—Dec. 31 1,663 350 87 263 835 282 173 23 1975—Aug. 31 2,624 839 536 303 1,392 264 106 23 Sept. 30 2,805 902 578 324 1,509 267 104 23 State and local governments: 1972—Dec. 31 10,904 6,159 5,203 956 2,033 816 1,298 598 1973—Dec. 31 9,829 5,845 4,483 1,362 1,870 778 1,003 332 1974—Dec. 31 7,864 4,121 3,319 802 1,796 815 800 332 1975—Aug. 31 8,920 5,081 4,347 734 1,716 774 826 523 Sept. 30 9,303 5,426 4,565 861 1,749 765 842 521 All others: 1972—Dec. 31 101,249 61,014 55,506 5,508 23,171 8,906 5,290 2,868 1973—Dec. 31 101,261 64,606 55,493 9,113 22,076 6,372 5,189 3,023 1974—Dec. 31 118,253 77,210 69,330 7,880 25,760 6,664 5,479 3,141 1975—Aug. 31 143,850 95,009 82,270 12,739 30,979 8,114 5,738 4,008 Sept. 30 144,809 93,975 81,974 12,001 33,190 8,110 5,630 3,903 NOTE.—Direct public issues only. Based on Treasury Survey of banks, and 732 insurance companies combined, each about 90 per cent; Ownership. (2) 458 nonfinancial corporations and 487 savings and loan assns., each Data complete for U.S. Govt, agencies and trust funds and F.R. Banks, about 50 per cent; and (3) 501 State and local govts., about 40 per cent. but data for other groups include only holdings of those institutions "All others," a residual, includes holdings of all those not reporting that report. The following figures show, for each category, the number in the Treasury Survey, including investor groups not listed separately. and proportion reporting: (1) 5,552 commercial banks, 473 mutual savings Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 36 U.S. GOVERNMENT SECURITIES • NOVEMBER 1975 DAILY-AVERAGE DEALER TRANSACTIONS (Par value, in millions of dollars) U.S. Government securities By maturity By type of customer UUU...SSS... GGGooovvvttt... PPPeeerrriiioooddd aaagggeeennncccyyy TToottaall ssseeecccuuurrriiitttiiieeesss Within 1-5 5-10 Over U.S. Govt, U.S. Govt, Com- All 1 year years years 10 years securities securities mercial otheri dealers brokers banks 1974—Sept 4,118 3,327 472 265 50 683 1,351 1,022 1,058 1,228 Oct 3,543 2,802 498 193 50 607 1,087 928 920 1,150 Nov 3,977 2,872 635 384 86 560 1,049 1,144 1,224 1,186 Dec 4,111 3,126 550 369 67 671 1,196 1,120 1,124 1,087 1975—Jan 5,415 3,495 1,514 303 104 887 1,549 1,503 1,478 1,244 Feb 5,770 3,353 1,521 711 185 698 2,044 1,511 1,518 1,233 Mar 4,467 2,812 994 464 197 671 1 ,183 1 ,198 1 ,415 928 Apr 5,197 3,682 1 ,096 285 134 704 1 ,450 1 ,242 1 ,801 904 May 6,419 4,181 1,615 466 158 981 1,917 1,454 2,067 1,049 June 5,732 3,745 1 ,484 372 132 801 1 ,689 1 ,336 1 ,906 1 ,217 July 4,675 3,301 1 ,131 172 71 669 1 ,294 1 ,100 1 ,613 778 Aug 5.183 3.375 1.340 333 134 742 1.405 1,185 1 ,851 844 Sept 5.566 4.032 1.315 128 91 931 1,405 1 .198 2,033 787 Week ending— 1975—Sept. 3 5,480 3,885 1.355 151 89 879 1,481 1 ,217 1,904 893 10 4,864 3,836 '858 106 65 774 1,231 1,143 1,716 560 17 5,033 3,400 1,371 135 128 794 1,133 1,097 2,010 577 24 '6,875 '4,912 1,711 144 108 1 ,167 '1,915 '1,398 2,395 1 ,129 Oct. 1 5.686 4,086 1.402 130 68 1,025 1,275 1,148 2,238 880 8 7,864 5,539 2.032 172 121 1 ,162 2,311 1,591 2,799 1 ,567 15 7,812 5.192 2,355 129 137 1,128 2,463 1,535 2,686 1 ,150 22 10,407 7,200 2,876 177 154 1,464 3,311 2,275 3,357 1 ,383 29 7,935 5,569 2,095 168 104 1,244 2,466 1.698 2,528 1.084 i Since Jan. 1972 has included transactions of dealers and brokers in They do not include allotments of, and exchanges for, new U.S. Govt, securities other than U.S. Govt. securities, redemptions of called or matured securities, or purchases or sales of securities under repurchase agreement, reverse repurchase (resale), NOTE.—The transactions data combine market purchases and sales of or similar contracts. Averages of daily figures based on the number of U.S. Govt, securities dealers reporting to the F.R. Bank of New York. trading days in the period. DAILY-AVERAGE DEALER POSITIONS DAILY-AVERAGE DEALER FINANCING (Par value, in millions of dollars) (In millions of dollars) U.S. Government securities, by maturity Commercial banks U.S. PPeerriioodd m t a A i t e l u s l r i- W y i e t 1 a h r i n y 1 e - a 5 r s y 5 e - a 1 rs 0 y O e 1 v a 0 e r r s a s G e g t c e o ie u n v s r c t i , y - Period sou A r l c l es Y N C o e it r w y k w E h ls e e r - e C t o io rp n o s r 1 a - ot A h l e l r 1974—Sept 3,033 2,692 329 328 59 1,190 1974—Sep t 4,709 1,312 1,247 480 1,671 Oct 2,837 2,149 420 247 21 1.414 Oct 4,621 1,194 1,003 571 1,853 Nov 4,478 2,998 714 602 163 1,530 Nov 5,626 1,466 1,245 561 2,355 Dec 4,821 3,100 974 553 175 1 .803 Dec 6,904 2,061 1,619 691 2,534 1975—Jan 4,634 2,689 1 ,236 600 113 1 ,578 1975—Ja n 6,185 1,455 1,277 864 2,590 Feb 5,588 3,658 1,180 536 213 1 ,469 Feb 6,295 1 ,672 1,077 714 2,832 Mar 5,737 3,435 1,486 618 198 1,444 Mar 6,881 1,879 1,650 838 2,513 Apr 4,453 3,123 1,036 218 77 937 Apr 5,696 1,655 1,326 583 2,132 May 6,332 4,917 1,094 248 73 896 May.... 6,656 1,684 1,567 452 2,953 June 6,768 5,923 748 100 -3 790 June.... 7,682 1,955 1,979 737 3,012 July 5,736 4,978 775 47 -64 626 July 6,594 1,365 1,435 929 2,865 Aug 5,501 4,491 609 262 138 610 Aug 6,167 1,009 1,148 1,120 2,890 Sept 5,718 5,214 410 56 39 529 Sept 6,576 1,160 1.640 972 2,804 Week ending— Week ending— 1975—Aug. 6 6,115 4,552 811 559 192 722 1975—Aug. 6. 6,584 1,318 1,270 934 3,061 13 5,350 4,575 411 233 130 586 13. 5,976 1,076 1,201 1,011 2,688 20 5,153 4,409 426 184 134 560 20. 6,061 1,110 1,197 1,227 2,527 27, 5,787 4,682 815 192 97 581 27. 6,229 679 1,021 1,240 3,289 Sept. 3. 5,685 4,649 791 183 62 660 Sept. 3. 6,089 963 979 1,175 2,973 10 6,136 5,302 626 149 59 470 10. 7,080 1,401 1,847 1,251 2,581 17 5,744 5,535 162 13 34 482 17. 7,275 1,247 1,992 1,112 2,925 24 5,356 5,016 338 -20 21 633 24. , 5,738 954 1,519 786 2,480 Oct. 1 5,196 4,833 326 7 30 450 Oct. 1. . 6,185 1,051 1,424 566 3,145 NOTE.—The figures include all securities sold by dealers under repur- 1 All business corporations, except commercial banks and insurance chase contracts regardless of the maturity date of the contract, unless the companies. contract is matched by a reverse repurchase (resale) agreement or delayed delivery sale with the same maturity and involving the same amount of NOTE.—Averages of daily figures based on the number of calendar days securities. Included in the repurchase contracts are some that more in the period. Both bank and nonbank dealers are included. See also clearly represent investments by the holders of the securities rather than NOTE to the table on the left. dealer trading positions. Average of daily figures based on number of trading days in the period. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • FEDERALLY SPONSORED CREDIT AGENCIES A 37 OUTSTANDING ISSUES OF FEDERALLY SPONSORED CREDIT AGENCIES, SEPTEMBER 30, 1975 Cou- Amount Cou- Amount Cou- Amount Agency, and date of issue pon (millions Agency, and date of issue pon (millions Agency, and date of issue pon (millions and maturity rate of dollars) and maturity rate of dollars) and maturity rate of dollars) Federal home loan banks Federal National Mortgage Banks for cooperatives Bonds: Association—Cont. Bonds: 12/18/70 •- 11/25/75.. 6.50 350 Debentures: 4/1/75 - 10/1/75 5.85 373 5/25/73 - 11/25/75... 7.05 600 3/10/72 - 12/10/75 5.70 500 5/1/75 - 11/3/75 6.15 374 5/28/74 -11/25/75. .. 9.10 700 9/10/73 - 12/10/75 8.25 300 6/2/75 - 12/1/75 5.80 497 6/21/74- 2/25/76... . 8.70 400 3/11/71 - 3/10/76 5.65 500 7/1/75 - 1/5/76 5.65 424 8/25/71 -2/25/76 7.38 300 6/12/73 - 3/10/76 7.13 400 8/4/75 -2/2/76 6.80 535 8/27/73 -2/25/76 8.75 300 6/10/71 - 6/10/76 6.70 250 9/2/75 - 3/1/76 7.40 506 8/26/74 -2/25/76 9.20 600 2/10/72 - 6/10/76 5.85 450 10/1/73 -4/4/77 7.70 200 6/22/73 - 5/25/76... . 7.20 600 9/10/74 -6/10/76 10.00 700 1122//22//7744 -- 1100//11//7799 8.00 201 11/27/73 - 5/25/76... 7.45 300 11/10/71 - 9/10/76 6.13 300 7/25/73 -- 8/25/76... . 7.80 500 6/12/72 -9/10/76 5.85 500 9/25/74 -•8/25/76.... 9.55 700 12/10/74 -9/10/76 7.50 200 Federal intermediate 10/25/74-- 11/26/76. . 8.60 600 7/12/71 - 12/10/76 7.45 300 credit banks 7/25/74 -11/26/76 ... 9.55 500 12/11/72 - 12/10/76 6.25 500 Bonds: 10/25/73 -- 2/25/77... 7.20 500 6/10/74-12/10/76 8.45 600 1/2/75 - 10/1/75 7.35 593 11/25/74--2/25/77.. . 8.05 500 3/13/62 - 2/10/77 4.50 198 2/3/75 - 11/3/75 7.05 824 6/21/74- 5/25/77... . 8.70 500 9/11/72 - 3/10/77 6.30 500 3/3/75-12/1/75 6.15 897 6/25/71 -5/25/77... . 6.95 200 3/11/74 - 3/10/77 7.05 400 3/1/73 - 1/5/76 6.65 261 4/12/73 -8/25/77.. .. 7.15 300 9/10/75- 3/10/77 8.30 450 4/1/75 - 1/5/76 6.05 1 ,079 5/28/74 -•8/25/77 8.80 600 12/10/70 - 6/10/77 6.38 250 5/1/75 - 2/2/76 6.60 909 2/26/73 -- 11/25/77... 6.75 300 5/10/71 - 6/10/77 6.50 150 6/2/75 - 3/1/76 6.15 840 11/27/73 - 11/25/77.. 7.45 300 12/10/73 - 6/10/77 7.20 500 7/1/75 -4/1/76 5.80 739 8/26/74 -• 11/25/77. . . 9.15 700 9/10/71 -9/12/77 6.88 300 8/4/75 -5/3/76 7.00 888 9/25/74 -2/27/78.... 9.38 400 9/10/73 -9/12/77 7.85 400 9/2/75 -6/1/76 7.60 725 9/21/73 -5/25/78 7.60 500 7/10/73 - 12/12/77 7.25 500 7/2/73 - 1/3/77 7.10 236 8/26/74 -11/27/78. .. 9.10 500 10/1/73 - 12/12/77 7.55 500 7/1/74-4/4/77 8.70 321 6/21/74 -2/26/79 8.65 600 6/10/74-3/10/78 8.45 650 1/2/74 - 1/3/78 7.10 406 9/25/74 -2/26/79 9.45 600 3/10/75-3/10/78 6.70 350 1/2/75 -1/2/79 7.40 410 10/25/74-- 5/25/79 . .. 8.65 500 6/12/73 - 6/12/78 7.15 600 7/1/75 - 1/2/80 7.40 531 5/28/74 -5/25/79 8.75 400 6/10/75 -6/12/78 7.45 400 7/25/74 -8/27/79 9.50 500 3/11/74 - 9/11/78 7.15 550 11/25/74 - 11/26/79. . 8.15 500 10/12/71 - 12/11/78 6.75 300 Federal land banks 12/23/74 - 11/26/79.. 7.50 500 7/10/74 - 12/11/78 8.95 450 Bonds: 3/25/70 -- 2/25/80. . . 7.75 350 12/10/73 - 3/12/79 7.25 500 7/20/71 - 10/20/75 7.20 300 2/25/74 --2/25/80.... 7.05 300 9/10/73 - 6/11/79 7.85 300 10/23/73 - 10/20/75 7.40 362 10/15/70 - 10/15/80.. 7.80 200 9/10/74 - 6/11/79 9.80 600 4/20/72 - 1/20/76 6.25 300 10/27/71 - 11/27/81. 6.60 200 6/12/72 -9/10/79 6.40 300 7/22/74 - 1/20/76 9.20 650 10/25/74 -11/25/81. . 8.65 400 12/10/74 -9/10/79 7.80 700 2/21/66 - 2/24/76 5.00 123 8/25/75 -- 2/25/82. . . 8.63 500 12/10/71 - 12/10/79 6.55 350 1/22/73 - 4/20/76 6.25 373 4/12/73 -5/25/83. . ., 7.30 183 6/10/75 - 12/10/79 7.75 650 4/22/74 -4/20/76 8.25 400 2/25/75 -11/25/83. . , 7.38 400 2/10/72 - 3/10/80 6.88 250 7/20/66 - 7/20/76 5.38 150 5/28/74 -5/25/84. . .. 8.75 300 3/10/75-3/10/80 7.25 750 1/21/74-7/20/76 7.05 360 10/25/73 - 11/26/93.. 7.38 400 4/1/75 -4/10/80 7.63 300 4/23/73 - 10/20/76 7.15 450 6/10/74-6/10/80 8.50 600 4/21/75 - 1/20/77 7.45 750 Federal Home Loan 2/16/73 - 7/31/80 5.19 1 7/21/75 - 10/20/76 7.20 650 Mortgage Corporation 2/16/73 - 7/31/80 3.18 9 4/22/74 -4/20/77 8.25 565 Bonds: 10/1/73 -9/10/80 7.50 400 7/20/73 - 7/20/77 7.50 550 5/29/73 - 8/25/76 7.05 400 9/10/75-9/10/80 8.75 650 10/20/71 - 10/20/77 6.35 300 5/11/72 - 2/25/77 6.15 350 1/16/73 - 10/30/80 4.46 5 10/21/74- 1/23/78 8.70 546 11/19/70 - 11/27/95 8.60 140 12/11/72 - 12/10/80 6.60 300 2/20/63 - 2/20/73-78.... 4.13 148 7/15/71 - 8/26/96 7.75 150 6/29/72- 1/29/81 6.15 156 5/2/66 - 4/20/78 5.13 150 5/11/72 - 5/26/97 7.15 150 3/12/73 - 3/10/81 7.05 350 1/20/75 -4/20/78 7.60 713 Certificates: 4/18/73 - 3/10/81 6.59 26 7/20/72 - 7/20/78 6.40 269 2/25/75 - 3/15/05 8.20 300 3/21/73 - 5/1/81 4.50 18 7/22/74 - 7/20/78 9.15 350 Federal National Mortgage 3/21/73 - 5/1/81 5.77 2 10/23/73 10/19/78 7.35 550 Association— 1/21/71 - 6/10/81 7.25 250 2/20/67 - 1/22/79 5.00 285 Secondary market 9/10/71 -9/10/81 7.25 250 1/21/74- 1/22/79 7.10 300 operations 9/10/74 - 9/10/81 9.70 300 9/15/72 -4/23/79 6.85 235 Discount notes 2,438 3/11/74 - 12/10/81 7.30 250 2/20/74 - 7/23/79 7.15 389 Capital debentures: 7/10/74 - 3/10/82 8.88 300 10/23/72 - 10/23/79. . 6.80 400 9/30/71 - 10/1/96 4.38 248 6/28/72 -5/1/82 5.84 58 1/22/73 - 1/21/80 6.70 300 10/2/72 - 10/1/97 7.40 250 2/10/71 -6/10/82 6.65 250 7/20/73 - 7/21/80 7.50 250 9/11/72 - 9/10/82 6.80 200 10/21/74- 10/20/80 8.70 400 Mortgage-backed bonds: 12/10/73 - 12/10/82 7.35 300 2/23/71 -4/20/81 6.70 224 3/14/73 - 1/15/81 3.58 53 3/11/71 - 6/10/83 6.75 200 7/22/74 -7/20/81 9.10 265 3/14/73 - 1/15/81 5.48 5 6/12/73 - 6/10/83 7.30 300 1/20/75 - 1/20/82 7.80 400 6/21/73 - 7/1/82 5.85 71 11/10/71 -9/12/83 6.75 250 4/20/72 -4/20/82 6.90 200 6/21/73 - 7/1/82 5.92 35 6/10/75 - 12/12/83 8.00 300 4/21/75 -4/20/82 8.15 300 3/1/73 - 8/31/84 5.50 10 4/12/71 -6/11/84 6.25 200 4/23/73 - 10/20/82 7.30 239 3/1/73 - 10/31/85 5.49 21 7/10/75 -7/10/84 8.20 300 7/21/75 - 1/20/83 8.20 464 3/1/73 - 3/1/86 5.74 81 12/10/74 - 9/10/84 7.95 300 10/23/73 - 10/20/83 7.30 300 9/29/70 - 10/1/90 8.63 200 12/10/71 - 12/10/84 6.90 250 6/23/75 - 7/22/85 8.10 391 3/10/75-3/11/85 7.65 500 3/10/72 - 3/10/92 7.00 200 6/12/72-6/10/92 7.05 200 12/11/72 - 12/10/97-82. . 7.10 200 NOTE.—These securities are not guaranteed by the U.S. Govt.; see also note to table at top of p. A-38. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 38 FEDERALLY SPONSORED CREDIT AGENCIES • NOVEMBER 1975 MAJOR BALANCE SHEET ITEMS OF SELECTED FEDERALLY SPONSORED CREDIT AGENCIES (In millions of dollars) Federal home loan banks Federal National Mortgage Assn. Banks Federal Federal (secondary market for intermediate land Assets Liabilities and capital operations) cooperatives credit banks banks End of period Ad- Cash Mem- Deben- Loans Loans vances Invest- and Bonds ber Capital Mort- tures to and Mortto ments de- and de- stock gage and cooper- Bonds dis- Bonds gage Bonds mem- posits notes posits loans notes atives counts loans bers (A) (L) (A) (L) (A) (L) (A) (L) 197 0 10,614 3,864 105 10,183 2,332 1,607 15,502 15,206 2,030 1,755 4,974 4,799 7,186 6,395 197 1 7,936 2,520 142 7,139 1,789 1,618 17,791 17,701 2,076 1,801 5,669 5,503 7,917 7,063 197 2 7,979 2,225 129 6,971 1,548 1,756 19,791 19,238 2,298 1,944 6,094 5,804 9,107 8,012 197 3 15,147 3,537 157 15,362 1,745 2,122 24,175 23,001 2,577 2,670 7,198 6,861 11,071 9,838 1974—Sept.. 20,772 2,681 135 20,647 2,160 2,543 28,641 27,312 3,092 2,835 8,931 8,502 13,185 11,782 Oct.. 21,409 3,224 105 22,058 2,129 2,580 29,139 27,543 3,598 2,855 8,838 8,482 13,418 12,427 Nov. 21,502 2,568 106 21,474 2,182 2,603 29,407 28,024 3,573 3,295 8,700 8,441 13,643 12,427 Dec.. 21,804 3,094 144 21,878 2,484 2,624 29,709 28,201 3,575 3,561 8,848 8,400 13,643 12,427 1975—Jan.. 20,728 4,467 113 21,778 2,612 2,699 29,797 28,030 3,910 3,653 8,888 8,419 14,086 13.020 Feb.. 19,460 4,838 99 20,822 2,819 2,698 29,846 27,730 3,821 3,592 9,031 8,484 14,326 13.021 Mar. 18,164 6,415 154 20,754 3,025 2,677 29,870 28,420 3,741 3,439 9,303 8,703 14,641 13,021 Apr.. 17,528 6,836 98 20,738 2,651 2.660 29,931 28,257 3,650 3,329 9,520 9,061 14,917 13,571 May. 17,145 5,745 98 19,463 2,708 2,656 29,977 27,714 3,499 2,982 9,763 9,231 15,180 13,571 June. 16,803 6,259 134 19,396 2,831 2,653 30,136 28,237 3,371 2,948 10,031 9,357 15,437 13,961 July. 16,685 6,174 119 19,446 2,436 2,656 30,453 28,419 3,520 2,914 10,163 9,556 15,654 14,351 Aug.. 16,945 4,680 89 '18,736 2,281 2,660 30,881 28,718 3,738 3,004 10,176 9,715 15,851 14,351 Sept.. 17,482 4,247 114 18,720 2,275 2,679 31,157 28,933 3,847 3,109 10,100 9,657 16,044 14,351 NOTE.—Data from Federal Home Loan Bank Board, Federal National offered securities (excluding, for FHLB's, bonds held within the FHLB Mortgage Assn., and Farm Credit Admin. Among omitted balance System) and are not guaranteed by the U.S. Govt.; for a listing of these sheet items are capital accounts of all agencies, except for stock of FHLB's. securities, see table on preceding page. Loans are gross of valuation reserves Bonds, debentures, and notes are valued at par. They include only publicly and represent cost for FN MA and unpaid principal for other agencies. NEW ISSUES OF STATE AND LOCAL GOVERNMENT SECURITIES (In millions of dollars) All issues (new capital and refunding) Issues for new capital Type of issue Type of issuer Total Use of proceeds Period amount deliv- Special ered3 Total G o e b a n l l e i- r- R n e u v e e - HAA1 G l U o o a . v S n t . s , State di s a s t n t a r d t i . c t Other 2 c E a d ti u o - n b R r a i o d n a g d d e s s i U ti t e i s l- 4 H i o n u g5 s - V a a e n i t d e s ' r - O p p o t u h s r e e - s r gations auth. 197 1 24,963 15,220 8,681 1,000 5,999 8,714 10,246 24,495 5,278 2,642 5,214 2,068 9,293 197 2 23,653 13,305 9,332 959 4,991 9,496 9,165 19,959 4,981 1,689 4,638 1,910 6,741 197 3 23,969 12,257 10,632 1,022 4,212 9,505 10,249 22,397 4,311 1,458 5,654 2,639 8,335 197 4 24,315 13,563 10,212 461 4,784 8,638 10,817 23,508 4,730 768 5,634 1,064 11,312 1974— O Se c p t. t . . . 2 1 , , 8 7 6 0 5 5 1,7 8 0 6 7 9 1,1 8 5 3 3 2 4 3 4 2 8 8 9 64 7 1 4 1,5 6 5 1 8 1 2 1 , , 7 6 3 6 8 9 2 3 5 4 1 3 11110 2 3 3 8 6 0 1 2 1 1 0 1 1 , ,0 9 0 39 6 Nov.. 2,487 1,110 1,374 689 1 ,005 789 2,403 698 4 866 9 826 Dec.. 1,500 761 717 222 558 700 1,475 297 64 424 53 637 1975—Jan.r. 2,367 1 ,364 997 372 702 1,293 2,332 710 49 644 172 757 Feb.r 2,392 1,723 664 877 629 880 2,353 478 209 425 105 1,136 Marr. 2,137 1,284 851 376 717 1,048 2,083 471 94 474 35 1,009 Apr.r 2,413 1,501 905 368 880 1 ,161 2,316 405 61 734 38 1,078 Mayr 2,905 1,885 1,015 811 1,197 889 2,784 419 211 559 25 1,570 June r 3,066 1,772 1,292 938 1,137 989 2,840 430 164 821 28 1,397 Julyr, 3,569 1,354 2,209 1 ,577 1,063 924 3,538 384 123 879 37 2,115 Aug.r 2,784 1,057 1,724 376 1,664 746 2,559 379 55 625 67 1,433 Sept.. 2,107 866 1,229 357 1,143 591 2,063 268 133 436 28 1,198 1 Only bonds sold pursuant to 1949 Housing Act, which are secured 4 Water, sewer, and other utilities. by contract requiring the Housing Assistance Administration to make 5 Includes urban redevelopment loans. annual contributions to the local authority. 2 Municipalities, counties, townships, school districts. NOTE.—Security Industries Assn. data; par amounts of long-term issues 3 Excludes U.S. Govt, loans. Based on date of delivery to purchaser based on date of sale unless otherwise indicated. and payment to issuer, which occurs after date of sale. Components may not add to totals due to rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • SECURITY ISSUES A 39 TOTAL NEW ISSUES (In millions of dollars) Gross proceeds, all issues1 Noncorporate Corporate Period Bonds Stock Total G U o . v S t . . 2 a G g U e o n . v S c t . y . 3 a ( n U S d t .S a lo t . e ) c 4 a l Others Total Total P o u f b fe li r c e l d y P p ri l v a a c t e e d l y Preferred Common 1971. 105,233 17,235 16,283 24,370 2,165 44,914 31,999 24,790 7,209 3,679 9,236 1972. 96,522 17,080 12,825 23,070 1,589 40,787 27,727 18,347 9,378 3,373 9,689 1973. 100,417 19,057 23,883 22,700 1,385 33,391 22,268 13,649 8,620 3,372 7,750 1974. 37,837 31,551 25,337 6,214 2,253 4,033 1974—June. 2,981 2,455 1 ,939 516 113 413 July.. 3,257 2,702 2,086 616 228 327 Aug.. 2,668 2,341 2,042 299 107 218 Sept.. 1 ,617 1,204 897 307 126 287 Oct... 4,609 3,778 3,423 355 196 635 Nov.. 3,746 3,346 3,016 330 93 307 Dec.. 3,505 3,052 2,172 880 152 301 1975—Jan.. . 5,376 4,787 3,635 1,130 235 354 Feb.., 4,526 3,904 3,201 703 173 449 Mar.. 5,368 4,471 3,971 500 253 644 Apr.. 4.439 3,193 2.771 360 347 899 May., 5,646 4,316 3,796 520 346 984 June. 5,570 4,565 3.943 622 230 775 Gross proceeds, major groups of corporate issuers Period Manufacturing C m om is m ce e l r l c a i n a e l ou a s n d Transportation Public utility Communication a R nd e a f l in e a s n ta c t i e a l Bonds Stocks Bonds Stocks Bonds Stocks Bonds Stocks Bonds Stocks Bonds Stocks 197 1 9,551 2.102 2,158 2,370 2,006 434 7,576 4,201 4,222 1,596 6,484 2,204 197 2 4,796 1,812 2,669 2,878 1,767 187 6,398 4,967 3,680 1,127 8,415 2,096 197 3 4,329 643 1,283 1,559 1,881 43 5,585 4,661 3,535 1,369 5,661 2,860 197 4 9,890 543 1,851 956 983 22 8,872 3,964 3,710 222 6,241 587 1974—June 434 43 303 139 5 15 859 288 355 1 491 39 July. 1,051 43 257 93 62 1 318 300 242 53 773 65 S A e u p g t . . 6 1 0 8 1 6 4 2 4 3 6 8 4 6 5 2 4 1 0 4 8 3 6 8 2 4 2 2 9 16 6 3 33 6 1 4 18 4 2 6 1 2 7 4 4 8 4 Oct.. 725 3 102 29 306 1,414 695 439 36 791 69 Nov. 1,697 2 116 100 336 739 225 62 31 397 44 Dec. 1,456 196 180 23 14 435 194 150 25 817 15 1975—Jan.. 1,898 3 179 74 84 r761 507 933 5 r931 Feb. 1,631 44 65 60 75 1,471 486 124 1 539 32 A M p a r r . . 2 1 , , 3 4 6 9 8 8 2 1 3 1 3 1 2 27 9 1 3 21 7 1 4 r 8 9 3 7 8 7 2 9 8 4 6 5 7 8 9 4 3 3 5 1 4 7 209 6 1 0 5 4 6 3 9 4 May 2,265 214 241 141 415 845 704 153 260 399 10 June 2,180 123 381 194 210 838 640 362 594 47 1 Gross proceeds are derived by multiplying principal amounts or 5 Foreign governments and their instrumentalities, International Bank number of units by offering price. for Reconstruction and Development, and domestic nonprofit organ- 2 Includes guaranteed issues. izations. 3 Issues not guaranteed. 4 See NOTE to table at bottom of opposite page. NOTE.—Securities and Exchange Commission estimates of new issues maturing in more than 1 year sold for cash in the United States. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 40 SECURITY ISSUES • NOVEMBER 1975 NET CHANGE IN OUTSTANDING CORPORATE SECURITIES (In millions of dollars) Derivation of change, all issuers1 i[ PPeerriioodd All securities Bonds and notes Common and preferred stocks New issues Retirements Net change New issues Retirements Net change New issues Retirements Net change 1971 46,687 9,507 37,180 31,917 8,190 23,728 14,769 1,318 13,452 1972 42,306 10.224 32,082 27,065 8.003 19,062 15,242 2,222 13,018 1973 33,559 11,804 21,754 21,501 8,810 12,691 12,057 2,993 9,064 1974 39,334 9,935 29,399 31,554 6,255 25,098 7,980 3,678 4,302 1974—11 9,637 2,048 7,589 7,847 1,584 6,263 1,790 465 1,326 Ill 8,452 2,985 5,467 6,611 1,225 5,386 1,841 1,759 82 IV 12,272 2,871 9,401 10,086 2,004 8,082 2,186 866 1,319 1975—1 15,211 2,088 13,123 12,759 1 ,587 11 ,172 2,452 501 1 ,951 II 15,602 3,211 12,390 11,460 2,336 9,124 4,142 875 3,266 Type of issues Manu- Commercial Transpor- Public Communi- Real estate Period facturing and other 2 tation 3 utility cation and financial i Bonds Bonds Bonds Bonds Bonds Bonds and Stocks and Stocks and Stocks and Stocks and Stocks and Stocks notes notes notes notes notes notes 1971 6,585 2,534 827 2,290 900 800 6,486 4,206 3,925 1,600 5,005 2,017 1972 1,995 2,094 1,409 2,471 711 254 5,137 4,844 3,343 1,260 7,045 2,096 1973 801 658 -109 1,411 1,044 -93 4,265 4,509 3,165 1,399 3,523 1,181 1974 7,404 17 1,116 -135 341 -20 7,308 3,834 3,499 398 5,428 207 1974—11 1,921 -12 698 213 -13 12 1,699 1,038 1,080 -7 877 82 Ill 1,479 -421 189 -664 49 -6 1,358 862 1,116 222 1,194 88 IV 3,098 126 240 -47 342 9 2,079 1,107 628 107 1,695 17 1975—1 5,134 262 373 77 1 1 2,653 1 ,569 1,269 24 1 ,742 18 II 4,574 500 483 490 429 7 1,977 1,866 810 359 852 43 1 Excludes investment companies. exclude foreign sales and include sales of securities held by affiliated com- 2 Extractive and commercial and miscellaneous companies. panies, special offerings to employees, and also new stock issues and cash 3 Railroad and other transportation companies. proceeds connected with conversions of bonds into stocks. Retirements are defined in the same way and also include securities retired with in- NOTE.—Securities and Exchange Commission estimates of cash trans- ternal funds or with proceeds of issues for that purpose. actions only. As contrasted with data shown on preceding page, new issues OPEN-END INVESTMENT COMPANIES (In millions of dollars) Sales and redemption Assets (market value Sales and redemption Assets (market value of own shares at end of period) of own shares at end of period) Sales 1 Redemp- Net Total 2 Cash Other Sales 1 Redemp- Net Total 2 Cash tions sales position 3 tions sales position 3 2,460 1,504 952 25,214 1,341 23,873 1974—Sept.. 499 292 207 31,985 5,078 3,404 1,875 1,528 29,116 1,329 27,787 Oct.. 816 311 505 37,115 5,652 4,359 1,962 2,395 35,220 1.803 33,417 Nov.. 619 335 284 36,366 5,804 Dec.. 736 411 325 35,777 5,637 4,671 2,005 2,665 34,829 2,971 31,858 4,670 2,745 1,927 44,701 2,566 42,135 1975—Jan.. 1,067 428 639 3,7407 3,889 6,820 3,841 2,979 52,677 3,187 49,490 Feb.. 889 470 419 39,330 4,006 Mar. 847 623 224 40,449 3,870 6,717 3,661 3,056 48,291 3,846 44,445 Apr.. 808 791 17 42,353 3,841 4 5 , , 6 14 2 5 4 2 4, . 7 9 5 8 1 7 1,6 3 3 9 7 4 4 5 7 5 , , 6 0 1 4 8 5 3 3 , , 6 0 4 3 9 8 4 5 3 2 , , 9 0 6 0 9 7 J M u a n y e . . 6 7 7 0 7 5 7 8 3 1 5 1 - - 1 5 0 8 8 4 4 5 3 , , 5 8 3 3 8 2 3 3 , ,8 6 7 4 9 0 July.. 763 981 -239 42,896 3,591 4,892 6,563 -1,671 59,831 3,035 56,796 Aug.. 753 788 -35 41,672 3,660 4,358 5,651 -1,261 46,518 4,002 42,516 Sept.. 760 874 -114 40,234 3,664 5,346 3,937 1,409 35,777 5,637 30,140 1 Includes contractual and regular single-purchase sales, voluntary and NOTE.—Investment Company Institute data based on reports of memcontractual accumulation plan sales, and reinvestment of investment in- bers, which comprise substantially all open-end investment companies come dividends; excludes reinvestment of realized capital gains dividends. registered with the Securities and Exchange Commission. Data reflect 2 Market value at end of period less current liabilities. newly formed companies after their initial offering of securities. 3 Cash and deposits, receivables, all U.S. Govt, securities, and other short-term debt securities, less current liabilities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • BUSINESS FINANCE A 41 CORPORATE PROFITS, TAXES, AND DIVIDENDS (In billions of dollars) Corporate Corporate Year P b t r e a o f x o f e i r s t e s c ta o I x n m e - e s P t a r a f o x t f e e i s r t s d C d e i a n v s d i h - s t U p ri r b n o u d f t i i e s ts - d co c a n a t l s i l p o o u i n w t m a - l p - Quarter P b t r e a o f x o f e i r s t e s c ta o I x n m e - e s P t a r a f o x t f e e i r s t s d C d e i a n v s d i h - s t U r p i r b n o u d f t i i e s ts - d co c a t n a l i s l p o o u n i w t m a - l p ances 1 ances 1 1968 87.6 39.9 47.8 23.6 24.2 46.8 1973—III... 122.7 49.9 72.9 29.8 43.1 71.6 1969 84.9 40.1 44.8 24.3 20.5 51.9 IV... 122.7 49.5 73.2 30.7 42.5 73.1 1970 74.0 34.8 39.3 24.7 14.6 56.0 1971 83.6 37.5 46.1 25.0 21.1 60.4 1974—1 135.4 52.2 83.2 31.6 51.6 74.1 1972 99.2 41.5 57.7 27.3 30.3 66.3 II. . . 139.0 55.9 83.1 32.5 50.5 75.7 1973 122.7 49.8 72.9 29.6 43.3 71.2 III... 157.0 62.7 94.3 33.2 61.1 77.6 1974 140.7 55.7 85.0 32.7 52.4 76.7 IV... 131 .5 52.0 79.5 33.3 46.2 79.3 1975—I. ... 101 .2 39.0 62.3 33.8 28.5 81 .2 II.. . . 113.3 43.0 70.3 34.0 36.3 83.0 I Includes depreciation, capital outlays charged to current accounts, and NOTE.—Dept. of Commerce estimates. Quarterly data are at seasonally accidental damages. adjusted annual rates. CURRENT ASSETS AND LIABILITIES OF NONFINANCIAL CORPORATIONS (In billions of dollars) Current assets Current liabilities NNNeeettt Notes and accts. Notes and accts. EEEnnnddd ooofff pppeeerrriiioooddd wwwooorrrkkkiiinnnggg UU..SS.. receivable payable AAccccrruueedd cccaaapppiiitttaaalll TToottaall CCaasshh ss GG eecc oo uu vv rr tt ii ,, -- II tt nn oo vv rrii ee ee nn ss -- OOtthheerr TToottaall FF iinn ee cc dd oo ee mm rraa ee ll OOtthheerr ttiieess G U ov .S t, . i Other G U o . v S t . . 1 Other ttaaxxeess 1970 187.4 492.3 50.2 7.7 4.2 201 .9 193.3 35.0 304.9 6.6 204.7 10.0 83.6 1971 203.6 529.6 53.3 11 .0 3.5 217.6 200.4 43.8 326.0 4.9 215.6 13.1 92.4 1972 221 .3 573.5 57.5 9.3 3.4 240.0 215.2 48.1 352.2 4.0 230.4 15.1 102.6 1973—11 235.4 608.2 59.0 10.0 2.9 255.4 230.1 50.8 372.7 4.5 241.7 15.0 111 .6 Ill 239.5 625.3 58.9 9.7 3.0 264.4 238.0 51 .3 385.8 4.4 250.2 16.5 114.7 IV 242.3 643.2 61.6 11 .0 3.5 266.1 246.7 54.4 401 .0 4.3 261 .6 18.1 117.0 1974—1 250.1 666.2 59.4 12.1 3.2 276.2 258.4 56.9 416.1 4.5 266.5 20.6 124.5 II 253.9 685.4 58.8 10.7 3.4 289.8 269.2 53.5 431 .5 4.7 278.5 19.0 129.1 Ill 259.5 708.6 60.3 11 .0 3.5 295.5 282.1 56.1 449.1 5.1 287.0 22.7 134.3 IV 261 .5 712.2 62.7 11 .7 3.5 289.7 288.0 56.6 450.6 5.2 287.5 23.2 134.8 1975—1 260.4 698.4 60.6 12.1 3.2 281 .9 285.2 55.4 438.0 5.3 271.2 21 .8 139.8 II 269.0 703.2 63.7 12.7 3.3 284.8 281.4 57.3 434.2 5.8 270.1 17.7 140.6 1 Receivables from, and payables to, the U.S. Govt, exclude amounts NOTE.—Based on Securities and Exchange Commission estimates. offset against each other on corporations' books. BUSINESS EXPENDITURES ON NEW PLANT AND EQUIPMENT (In billions of dollars) Manufacturing Transportation Public utilities Period TToottaall Durable du N r o a n b - le MMiinniinngg R ro a a i d l- Air Other Electric and Ga o s t her nn CC ii oo cc mm aattii mm oo uu nn -- ss OOtthheerr ii T A T A ((SS oo ..RR AA ttaa .. .. ll )) 197 1 81.21 14.15 15.84 2.16 1.67 1.88 1.38 12.86 2.44 10.77 18.05 197 2 88.44 15.64 15.72 2.45 1.80 2.46 1.46 14.48 2.52 11.89 20.07 197 3 99.74 19.25 18.76 2.74 1.96 2.41 1.66 15.94 2.76 12.85 21.40 197 4 112.40 2.2.62 23.39 3.18 2.54 2.00 2.12 17.63 2.92 13.96 22.05 1973—11.., 24.73 4.65 4.51 .71 .46 .72 .43 3.91 .68 3.27 5.40 97.76 III.. 25.04 4.84 4.78 .69 .48 .57 .44 4.04 .77 3.19 5.24 100.90 IV . 28.48 5.84 5.59 .71 .56 .60 .47 4.54 .82 3.53 5.83 103.74 1974—1... 24.10 4.74 4.75 .68 .50 .47 .34 3.85 .52 3.19 5.05 107.27 II.. 28.16 5.59 5.69 .78 .64 .61 .49 4.56 .75 3.60 5.46 111.40 III.. 28.23 5.65 5.96 .80 .64 .43 .58 4.42 .78 3.39 5.57 113.99 IV.. 31.92 6.64 6.99 .91 .78 .48 .71 4.80 .87 3.78 5.97 116.22 1975—1. ., 25.82 5.10 5.74 .91 .59 .44 .62 3.84 .58 3.11 4.88 114.57 II.. 28.43 5.59 6.55 .97 .71 .47 .77 4.15 .79 3.22 5.19 112.46 Ill 2 28.08 5.36 6.49 .91 .60 .51 .72 4.34 .90 8. 24 113.48 1 Includes trade, service, construction, finance, and insurance. NOTE.—Dept. of Commerce estimates for corporate and noncorporate 2 Anticipated by business. business; excludes agriculture, real estate operators, medical, legal, educational, and cultural service, and nonprofit organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 42 REAL ESTATE CREDIT • NOVEMBER 1975 MORTGAGE DEBT OUTSTANDING BY TYPE OF HOLDER (In millions of dollars) End of year End of quarter Type of holder, and type of property 1974 1975 1971 1972 1973 ALL HOLDERS 499,758 564,825 634,954 664,291 678,681 688,563 695,337 709,170 1- to 4-family 307,200 345,384 386,240 402,131 410,175 414,950 418,663 428,599 Multifamily 67,367 76,496 85,401 88,258 90,269 92,042 92,913 93,844 Commercial 92,333 107,508 123,965 132,121 135,046 137,280 138,278 139,929 Farm 32,858 35,437 39,348 41,781 43,191 44,291 45,483 46,798 PRIVATE FINANCIAL INSTITUTIONS.. 394,239 450,000 505,400 528,166 537,512 542,576 546,894 558,402 1- to 4-family 253,540 288,053 322,047 335,408 340,848 343,363 346,073 354,471 Multifamily 52,498 59,204 64,730 66,583 67,843 68,520 69,019 69,964 Commercial 78,345 92,222 107,128 114,184 116,509 118,263 119,261 121 ,210 Farm 9,856 10,521 11,495 11,991 12,312 12,430 12,541 12,757 Commercial banks1 82,515 99,314 119,068 127,320 130,582 132,105 132,105 133,305 1- to 4-family 48,020 57,004 67,998 72,253 73,987 74,758 74,740 75,419 Multifamily 3,984 5,778 6,932 7,313 7,496 7,619 7,614 7,684 Commercial 26,306 31,751 38,696 41,926 43,092 43,679 43,700 44,097 Farm 4,205 4,781 5,442 5,828 6,007 6,049 6,051 6,105 Mutual savings banks 61,978 67,556 73,230 74,225 74,809 74,920 75,160 75,726 1- to 4-family 38,641 41,650 44,246 44,398 44,604 44,670 44,796 45,133 Multifamily 14,386 15,490 16,843 17,070 17,208 17,234 17,292 17,417 Commercial 8,901 10,354 12,084 12,698 12,938 12,956 12,997 13,100 Farm 50 62 57 59 59 60 75 76 Savings and loan associations 174,250 206,182 231,733 243,393 247,612 249,293 252,442 261,336 1- to 4-family 142,275 167,049 187,750 197,002 200,343 201,553 204,099 211,290 Multifamily 17,355 20,783 22,524 23,342 23,573 23,683 23,831 24,409 Commercial 14,620 18,350 21,459 23,049 23,696 24,057 24,512 15,637 Life insurance companies 75,496 76,948 81,369 83,228 84,509 86,258 87,187 88,035 1- to 4-family 24,604 22,350 22,053 21,755 21,914 22,382 22,438 22,629 Multifamily 16,773 17,153 18,431 18,858 19,566 19,984 20,282 20,454 Commercial 28,518 31,767 34,889 36,511 36,783 37,571 38,052 38,376 Farm 5,601 5,678 5,996 6,104 6,246 6,321 6,415 6,576 FEDERAL AND RELATED AGENCIES.. 39,357 45,790 55,664 62,585 67,829 72,267 75,973 79,696 1- to 4-family 26,453 30,147 35,454 39,784 43,188 45,748 47,751 50,389 Multifamily 4,555 6,086 8,489 9,643 10,644 11,790 12,662 12,898 Commercial Farm 8,338 9,557 11,721 13,158 13,997 14,729 15,560 16,409 Government National Mortgage Association 5,323 5,113 4,029 3,618 4,052 5,584 5,612 1- to 4-family 2,770 2,490 1,330 1,194 1,337 1,600 1,843 1,852 Multifamily 2,542 2,623 2,699 2,424 2,715 3,248 3,741 3,760 Commercia' 11 Farmers Home Administration 819 837 1,200 1,400 ,500 1,600 1,700 1,800 1- to 4-family 398 387 550 642 688 734 780 826 Farm 421 450 650 758 812 866 920 974 Federal Housing and Veterans Administrations 3,389 3,338 3,476 3,619 3,765 3,900 4,025 4,039 1- to 4-family 2,517 2,199 2,013 1,980 2,037 2,083 2,119 2,044 Multifamily 872 1,139 1,463 1,639 1,728 1,817 1,906 1,995 Federal National Mortgage Association 17,791 19,791 24,175 26,559 28,641 29,578 29,754 30,015 1- to 4-family 16,681 17,697 20,370 21,691 23,258 23,778 23,743 23,988 Multifamily 1,110 2,094 3,805 4,868 5,383 5,800 6,011 6,027 Federal land banks (farm only) 7,917 9,107 11,071 12,400 13,185 13,863 14,640 15,435 Federal Home Loan Mortgage Corporation. 964 1,789 2,604 3,191 3,713 4,586 4,608 4,944 1- to 4-family 934 1,754 2,446 2,951 3,414 4,217 4,231 4,543 Multifamily 30 35 158 240 299 369 377 401 GNMA Pools 3,154 5,815 9,109 11,798 12,973 13,892 15,662 17,851 1- to 4-family 3,153 5,620 8,745 11,326 12,454 13,336 15,035 17,136 Multifamily 1 195 364 472 519 556 627 715 INDIVIDUALS AND OTHERS2 66,162 69,035 73,890 73,540 73,340 73,720 72,470 71,072 1- to 4-family 27,207 27,184 28,739 26,939 26,139 25,839 24,839 23,739 Multifamily 10,314 11,206 12,182 12,032 11,782 11,732 11,232 10,982 Commercial 13,977 15,286 16,837 17,937 18,537 19,017 19,017 18,719 Farm 14,664 15,359 16,132 16,632 16,882 17,132 17,382 17,632 1 Includes loans held by nondeposit trust companies but not bank trust NOTE.—Based on data from various institutional and Govt, sources, departments. with some quarters estimated in part by Federal Reserve in conjunction 2 Includes some U.S. agencies for which amounts are small or separate with the Federal Home Loan Bank Board and the Dept. of Commerce. data are not readily available. Separation of nonfarm mortgage debt by type of property, where not reported directly, and interpolations and extrapolations where required, estimated mainly by Federal Reserve. Multifamily debt refers to loans on structures of 5 or more units. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • REAL ESTATE CREDIT A 43 FEDERAL NATIONAL MORTGAGE ASSOCIATION AND FEDERAL HOME LOAN MORTGAGE CORPORATION- SECONDARY MORTGAGE MARKET ACTIVITY (In millions of dollars) FNMA FHLMC Mortgage Mortgage Mortgage Mortgage Mortgage Mortgage EEEnnnddd ooofff holdings transactions commitments holdings transactions commitments pppeeerrriiioooddd (during period) (during period) Total i F su H in re A - d - a g n V u t A e a e r - - d c P ha u s r e - s Sales p d M e u r r a i i d o n e d g st O i a n n u g d t - - Total F V H A A - t C i v o e o n n n a - - l c P ha u s r e - s Sales p d M e u r r a i i d o n e d g s O t i a n u n g t d - - 1971 11117777,,,,777799991111 11112222,,,,666688881111 5555,,,,111111110000 3333,,,,555577774444 333366 9999,,,,888822228888 6666,,,,444499997777 999666888 888222111 111444777 777777888 6644 111888222 111999777 222 11119999,,,,777799991111 11114444,,,,666622224444 5555,,,,111111112222 3333,,,,666699999999 221111 8888,,,,777799997777 8888,,,,111122224444 111,,,777888999 111,,,555000333 222888666 111,,,222999888 440088 11,,660066 111999888 111999777 333 22224444,,,,111177775555 11116666,,,,888855552222 6666,,,,333355552222 6666,,,,111122227777 7711 8888,,,,999911114444 7777....888888889999 222,,,666000444 111,,,777444333 888666111 111,,,333333444 440099 11,,662299 111888666 111999777 444 22229999,,,,555577778888 11119999,,,,111188889999 8888,,,,333311110000 6666,,,,999955553333 55 11110000,,,,777766665555 7777,,,,999966660000 444,,,555888666 111,,,999000444 222,,,666888222 222,,,111999111 5522 44,,555533 222,,,333999000 111999777444———SSSeeepppttt... ... 22228888,,,,666644441111 11118888,,,,777755558888 7777,,,,999999994444 777766660000 999999997777 9999,,,,000044443333 333,,,777111333 111,,,888999666 111,,,888111777 222777333 6699 333,,,222777888 OOOcccttt......... 22229999,,,,111133339999 11118888,,,,999966666666 8888,,,,222200006666 666611112222 888877778888 8888,,,,999988887777 444,,,111000777 111,,,999111000 222,,,111999777 444111000 7 3300 222,,,888777111 NNNooovvv......... 22229999,,,,444400007777 11119999,,,,000088883333 8888,,,,222299991111 333377779999 222200001111 8888,,,,555533332222 444,,,333555222 111,,,999000888 222,,,444444555 222777000 12 2288 222,,,666222111 DDDeeeccc......... 22229999,,,,555577778888 11119999,,,,111188889999 8888,,,,333311110000 222277778888 222233331111 7777,,,,999966660000 444,,,555888666 111 ,,,999000444 222,,,666888222 222666666 16 3344 222,,,333999000 111999777555———JJJaaannn...... ... 22229999,,,,666677770000 11119999,,,,222233331111 8888,,,,333311118888 222200008888 111144446666 7777,,,,222288885555 444,,,777444444 111,,,999000000 222,,,888444555 111999999 26 2266 222,,,111999000 FFFeeebbb......... 22229999,,,,777711118888 11119999,,,,222255556666 8888,,,,333311113333 111166669999 111133337777 6666,,,,666677772222 444,,,555333333 111 ,,,888999333 222,,,666444000 111111333 309 2211 222,,,000777000 MMMaaarrr... ... 22229999,,,,777755554444 11119999,,,,222277777777 8888,,,,333300004444 111155550000 1 666633339999 6666,,,,666633336666 444,,,666000888 111 ,,,888888777 222,,,777222222 111111333 19 5522 111 ,,,000444000 AAAppprrr......... 22229999,,,,888811115555 11119999,,,,222288882222 8888,,,,333333337777 222211111111 999911113333 6666....888899990000 444,,,666333444 111 ,,,888999000 222,,,777444444 111222111 71 229977 111,,,111666111 MMMaaayyy...... 22229999,,,,888855558888 11119999,,,,222255551111 8888,,,,333399995555 222244447777 666622221111 6666,,,,666611115555 444,,,777777333 111,,,999222000 222,,,888555444 222000333 38 4422 999666999 JJJuuunnneee...... 33330000,,,,000011115555 11119999,,,,222288882222 8888,,,,444499998888 333322226666 555555557777 6666,,,,555544449999 444,,,999444444 111,,,999333666 333,,,000000888 222111000 5 2288 777000000 JJJuuulllyyy... ... 33330000,,,,333355551111 11119999,,,,333388885555 8888,,,,666699993333 555533338888 555577775555 6666,,,,111111119999 555,,,000111555 111 ,,,999444333 333,,,000777222 111666111 63 113399 555333000 AAAuuuggg......... 33330000,,,,777777777777 11119999,,,,555500007777 8888,,,,999944442222 555599994444 888811114444 5555,,,,888888888888 444,,,999444222 111,,,888666333 333,,,000888000 999888 145 113322 555000999 SSSeeepppttt......... 33331111,,,,000055555555 11119999,,,,555566660000 9999,,,,111122222222 444488888888 555577775555 5555,,,,333399999999 i Includes conventional loans not shown separately. For FHLMC: Data for 1970 begin with Nov. 26, when the FHLMC NOTE.—Data from FNMA and FHLMC, respectively. became operational. Holdings and transactions cover participations as For FNMA: Holdings include loans used to back bond issues guaranteed well as whole loans. Holdings include loans used to back bond issues by GNMA. Commitments include some multifamily and nonprofit guaranteed by GNMA. Commitments cover the conventional and Govt.hospital loan commitments in addition to 1- to 4-family loan commitments underwritten loan programs. accepted in FNMA's free market auction system, and through the FNMA- GNMA Tandem Plan (Program 18). TERMS AND YIELDS ON NEW HOME MORTGAGES Conventional mortgages FFFHHHAAA--- Terms i Yields (per cent) in iiinnnsssuuurrreeeddd primary market llloooaaannnsss———YYYiiieeelllddd PPPeeerrriiioooddd iiinnn ppprrriiivvvaaattteee C ra o te n t ( r p a e c r t F c e h e a s rg a e n s d Maturity Loa r n a / t p io r ice pr P ic u e r c ( h th a o se u s. am Lo o a u n n t FHLBB HUD ssseee mmm ccc aaa ooo rrr nnn kkk ddd eee aaa ttt rrr 555 yyy cent) (per cent)2 (years) (per cent) of dollars) (t d h o o l u la s r . s) o f series 3 series 4 1971 7.60 .87 26.2 74.3 36.3 26.5 7.74 7.75 7.70 1972 7.45 .88 27.2 76.8 37.3 28.1 7.60 7.64 7.53 1973 7.78 1 11 26.3 77.3 37.1 28.1 7.95 8.30 8.19 1974 8.71 1 .30 26.3 75.8 40.1 29.8 8.92 9.22 9.55 1974—Sept 8.97 1.30 26.1 74.8 42.4 31.1 9.19 9.80 10.38 Oct 8.95 1.37 26.7 74.7 42.3 30.7 9.17 9.70 10.13 Nov 9.04 1.40 26.2 73.6 41.3 30.2 9.27 9.55 Dec 9.13 1.44 27.5 75.5 42.4 31.3 9.37 9.45 9.51 1975—Jan 9.09 1.51 26.7 73.8 43.2 31.6 9.33 9.15 8.99 Feb 8.88 1 .44 26.8 76.5 44.4 33.0 9.12 9.05 8.84 Mar 8.79 1 .61 26.5 75.1 45.9 33.7 9.06 8.90 8.69 Apr 8.71 1 53 26.5 76.4 44 5 33.4 8 96 9 00 May 8.63 1 .63 27.0 75.5 43.5 32.2 8.90 9.05 9.16 June 8.73 1.42 26.5 76.4 43.1 32.4 8.96 9.00 9.06 July 8.66 1 .40 26.0 75.9 44.1 32.9 8.89 9.00 9.13 Aug 8.63 1.56 26.7 77.0 44.6 33.7 8.89 9. 15 9.32 Sept.f 8.70 1.46 26.7 76.0 45.3 34.0 8.94 9.25 9.74 1 Weighted averages based on probability sample survey of character- (as shown in first column of this table) and an assumed prepayment at istics of mortgages originated by major institutional lender groups (in- end of 10 years. cluding mortgage companies) for purchase of single-family homes, as 4 Rates on first mortgages, unweighted and rounded to the nearest compiled by Federal Home Loan Bank Board in cooperation with Federal 5 basis points. Deposit Insurance Corporation. Data are not strictly comparable with 5 Based on opinion reports submitted by field offices of prevailing earlier figures beginning Jan. 1973. local conditions as of the first of the succeeding month. Yields are derived 2 Fees and charges—related to principal mortgage amount—include from weighted averages of private secondary market prices for Sec. 203, loan commissions, fees, discounts, and other charges, but exclude closing 30-year mortgages with minimum downpayment and an assumed precosts related solely to transfer of property ownership. payment at the end of 15 years. Any gaps in data are due to periods of 3 Effective rate, reflecting fees and charges as well as contract rates adjustment to changes in maximum permissible contract interest rates. NOTE TO TABLE AT BOTTOM OF PAGE A-44: amortization and prepayment terms. Data for the following are limited to cases where information was available or estimates could be made: American Life Insurance Association data for new commitments of capitalization rate (net stabilized property earnings divided by property $100,000 and over each on mortgages for multifamily and nonresidential value); debt coverage ratio (net stabilized earnings divided by debt service); nonfarm properties located largely in the United States. The 15 companies and per cent constant (annual level payment, including principal and account for a little more than one-half of both the total assets and the interest, per $100 of debt). All statistics exclude construction loans, nonfarm mortgages held by all U.S. life insurance companies. Averages, increases in existing loans in a company's portfolio, reapprovals, and loans which are based on number of loans, vary in part with loan composition secured by land only. by type and location of property, type and purpose of loan, and loan Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 44 REAL ESTATE CREDIT • NOVEMBER 1975 FEDERAL NATIONAL MORTGAGE ASSOCIATION AUCTIONS OF COMMITMENTS TO BUY HOME MORTGAGES Date of auction Item 1975 May 19 June 2 June 16 June 30 July 14 July 28 Aug. 11 Aug. 25 Sept. 8 Sept. 22 Oct. 6 Oct. 20 Amounts (millions of dollars): Govt.-underwritten loans Offered i 165.6 172.5 73.4 358.7 333.2 415.8 578.7 643.1 530.1 293.6 198.5 43.2 Accepted 115.0 80.4 38.6 246.9 174.9 247.7 365.5 223.0 197.7 142.0 143.0 23.2 Conventional loans Offered i 46.4 51.2 28.5 67.5 71.4 56.5 96.9 98.5 96.9 68.8 27.5 9.7 38.4 27.1 15.7 47.3 35.8 34.5 48.9 31.0 43.9 35.2 23.5 9.2 Average yield (per cent) on shortterm commitments2 Govt.-underwritten loans 9.25 9.14 9.06 9.07 9.10 9.17 9.32 9.50 9.70 9.86 9.95 9.65 Conventional loans 9.41 9.26 9.21 9.18 9.20 9.26 9.38 9.55 9.75 9.92 10.02 9.81 1 Mortgage amounts offered by bidders are total bids received. period of 12 years for 30-year loans, without special adjustment for 2 Average accepted bid yield (before deduction of 38 basis-point fee FNMA commitment fees and FNMA stock purchase and holding requirepaid for mortgage servicing) for home mortgages assuming a prepayment ments. Commitments mature in 4 months. MAJOR HOLDERS OF FHA-INSURED AND VA-GUARANTEED RESIDENTIAL MORTGAGE DEBT (End of period, in billions of dollars) Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, Mar. 31, June 30, Holder 1973 1974 1974 1974 1974 1975 1975 All holders 135.0 136.7 137.8 138.6 140.3 142.0 143.0 FHA 85.0 85.0 84.9 84.1 84.1 84.3 85.0 VA 50.0 51.7 52.9 54.5 56.2 57.7 58.0 Commercial banks 11.5 11.1 11.0 10.7 10.4 10.5 10.6 FHA 8.2 7.8 7.6 7.4 7.2 7.2 7.3 VA 3.3 3.3 3.4 3.3 3.2 3.3 3.3 Mutual savings banks 28.4 28.2 27.9 27.8 27.5 27.6 27.8 FHA 15.5 15.3 15.1 15.0 14.8 14.8 14.9 VA 12.9 12.9 12.8 12.8 12.7 12.8 12.9 Savings and loan assns V FH A A ) 29.7 } 29.8 } 29.7 } 29.8 } 29.8 J '29.9 J 30.2 Life insurance cos j 13.6 13.3 13.1 12.9 12.7 12.5 12.2 FHA 9.2 9.0 8.8 8.7 8.6 8.4 8.2 VA 4.4 4.3 4.3 4.2 4.2 4.1 4.0 Others 52.1 54.3 56.1 57.4 59.9 61 .6 62.2 FHA VA NOTE.—VA-guaranteed residential mortgage debt is for 1- to 4-family Detail by type of holder partly estimated by Federal Reserve for first properties while FHA-insured includes some debt in multifamily structures. and third quarters, and for most recent quarter. COMMITMENTS OF LIFE INSURANCE COMPANIES FOR INCOME PROPERTY MORTGAGES Averages TToottaall PPeerriioodd oo NN ff uu ll mm oo bb aann ee ss rr (( cc mm oo (( aa ii mm dd mm ll oo ll mm ii oo ll oo ll uu ii aa nn tt rr nn ss tt ss ee tt )) dd oo ff ( o t f a h m o L d u o o o s a l u a l n n a n t r d s s ) ( C p i o n e r r t n e a t r t c r e e a e s n c t t t ) (y M rs a . t / u m r o it s y . ) (p t L o e r r - a o v t a c i a e n o l n - u t e ) C ( a p t p e i i r o t n a c l e i r n z a a t t ) e - co D r v a e e t r i b o a t ge P co er n s c t e a n n t t 1971 1,664 3,982.5 2,393 9.07 22/10 74.9 10.0 .1.29 10.4 1972 2,132 4,986.5 2,339 8.57 23/3 75.2 9.6 1.29 9.8 1973 2,140 4,833.3 2,259 8.76 23/3 74.3 9.5 1.29 10.0 1974 1,166 2,603.0 2,232 9.47 21/3 74.3 10.1 1 .29 10.6 1974—June 147 287.5 1,956 9.35 20/10 75.7 10.1 1.24 10.7 July 121 234.6 1,939 9.60 20/0 74.1 10.1 1.26 10.8 Aug 105 312.4 2,975 9.80 22/10 74.3 10.2 1.31 10.7 Sept 95 241.6 2,543 10.04 20/11 74.4 10.3 1.29 11.1 Oct 57 108.3 1,899 10.29 19/7 74.6 10.6 1 .25 11.5 Nov 47 79.7 1,695 10.37 18/4 74.0 10.7 1 .26 11.6 Dec 37 140.0 3,784 10.28 19/10 74.8 11 .0 1.33 11 .3 1975—Jan 31 43.8 1,414 10.44 18/4 71.9 11.0 1.33 11.9 Feb 46 94.6 2,057 10.08 22/11 74.3 10.9 1 .34 11 .0 Mar 46 109.6 2,382 10.37 23/1 74.1 11 .3 1 .34 11.3 Apr 32 108.4 3,386 10.02 23/0 75.6 10.8 1.36 10.8 May 73 227.5 3,116 10.23 20/9 74.7 10.8 1.30 11.1 June 61 167.5 2,745 10.11 21/9 73.0 10.5 1.29 11.2 See NOTE on preceding page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • CONSUMER CREDIT A 45 TOTAL CREDIT (In millions of dollars) Instalment Noninstalment Total Other Home Charge accounts Auto- consumer improve- Personal Single- Total mobile goods ment loans Total payment paper paper loans1 loans Retail Credit outlets cards2 89,883 70,893 28,437 18,483 3,736 20,237 18,990 7,671 5,724 706 96,239 76,245 30.010 20,732 3,841 21,662 19,994 7,972 5,812 874 100,783 79,428 29,796 22,389 4,008 23,235 21,355 8,558 6,041 1,029 110,770 87,745 32,948 24,626 4,239 25,932 23,025 9,532 5,966 1,227 121,146 97,105 35,527 28,313 4,613 28,652 24,041 9,747 5,936 1,437 127,163 102,064 35,184 31,465 5,070 30,345 25,099 9,675 6,163 1,805 138,394 111,295 38,664 34,353 5,413 32,865 27,099 10,585 6,397 1,953 157,564 127,332 44.129 40,080 6,201 36,922 30,232 12,256 7,055 1,947 1$0,486 147,437 51.130 47,530 7,352 41,425 33,049 13,241 7,783 2,046 190,121 156,124 51,689 52,009 8,162 44,264 33,997 12,979 8,012 2,122 187,906 155,139 52,848 49,664 8,252 44,375 32,767 13,131 6,876 2,277 188,023 155,328 52,736 49,986 8,287 44,319 32,695 13,003 7,027 2,156 188,084 155,166 52,325 50,401 8,260 44,180 32,918 12,950 7,174 2,144 190,121 156,124 51,689 52,009 8,162 44,264 33,997 12,979 8,012 2,122 187,080 153,952 50,947 51,142 8,048 43.815 33,128 12,675 7,162 2,153 185,381 152,712 50,884 50,136 7,966 43,726 32,669 12,560 6,468 2,074 184,253 151,477 50,452 49,391 7,925 43,709 32,776 12,542 6,452 2,033 184,344 151,271 50,360 49,247 7,880 43,784 33,073 12,526 6,735 2,062 185,010 151,610 50,465 49,329 7,908 43,908 33,400 12.443 7,268 2,073 186,099 152,668 50,927 49,519 7,973 44,249 33,431 12,470 7,361 2,088 187,211 153,930 51,556 49,637 8,040 44,697 33,281 12,282 7,388 2,180 188,821 155,263 52.011 50,061 8,094 45,097 33,558 12,362 7,392 2,247 190,069 156,332 52,308 50,441 8,136 45,447 33,737 12.444 7,424 2,283 1 Holdings of financial institutions; holdings of retail outlets are in- NOTE.—Consumer credit estimates cover loans to individuals for cluded in "Other consumer goods paper." household, family, and other personal expenditures, except real estate 2 Service station and miscellaneous credit-card accounts and home- mortgage loans. For back figures and description of the data, see "Conheating-oil accounts. sumer Credit," Section 16 (New) of Supplement to Banking and Monetary Statistics, 1965, and BULLETINS for Dec. 1968 and Oct. 1972. CONSUMER CREDIT HELD BY COMMERCIAL BANKS (In millions of dollars) Instalment Noninstalment End of period Total Automobile paper Other consumer goods paper Home Personal loans improve- Total ment Purchased Direct Mobile Credit Other loans Check Other homes cards credit 35,652 28,962 10,209 5,659 4,166 2,571 6,357 38,265 31,319 11,024 5,956 4,681 2,647 7,011 40,630 33,152 10,972 6,232 5,469 2,731 7,748 46,310 37,936 12,324 7,102 1,307 5,387 2,858 798 8,160 50,974 42,421 13,133 7,791 2,639 6,082 2,996 1,081 8,699 53,867 45,398 12,918 7,888 3,792 7,113 3,071 1,336 9,280 60,556 51,240 13,837 9,277 4,423 4,419 4,501 3,236 1,497 10,050 70,640 59,783 16,320 10,776 5,786 5,288 5,122 3,544 1,789 11,158 81,248 69,495 19,038 12,218 7,223 6,649 6,054 3,982 2,144 12,187 84,010 72,510 18,582 11,787 7,645 8,242 6,414 4,458 2,424 12,958 85,096 73,455 19,389 12,314 7,706 7,638 6,527 4,445 2,348 13,088 84,887 73,372 19,246 12,195 7,709 7,749 6,530 4,480 2,376 13,087 84,360 72,896 18,981 12,031 7,700 7,846 6,469 4,490 2,362 13,017 84,010 72,510 18,582 11,787 7,645 8,242 6,414 4,458 2,424 12,958 82,986 71,776 18,230 11,581 7,587 8,325 6,323 4,399 2.448 12,883 8 8 2 1 , ,2 2 0 29 1 7 7 0 1 , , 1 15 8 1 3 1 1 7 8 , , 7 10 5 4 4 1 1 1 1 , , 3 4 7 9 7 7 7 7 , , 4 5 5 2 9 2 8 7 . , 1 8 4 9 9 0 6 6 , , 2 2 7 7 2 2 4 4 , , 3 3 5 1 9 8 2 2 . , 4 40 4 3 7 1 1 2 2 , , 7 8 1 0 0 1 81,155 70,134 17,613 11,387 7,417 7,909 6,312 4,318 2,411 12,767 81,066 70,130 17,529 11,417 7,391 7,903 6,373 4,353 2,383 12,781 81,429 70,475 17,560 11,482 7,375 7,977 6,446 4,403 2,375 12,857 81,767 70,996 17,708 11,613 7,351 8,042 6,497 4,463 2,396 12,926 82,305 71,445 17,676 11,712 7,335 8,210 6,524 4,522 2,420 13,046 82,677 71,751 17,639 11,774 7,324 8,363 6,523 4,561 2.448 13,119 See NOTE to table above. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 46 CONSUMER CREDIT • NOVEMBER 1975 INSTALMENT CREDIT HELD BY NONBANK LENDERS (In millions of dollars) Finance companies Other financial lenders Retail outlets Other consumer Auto- goods paper Home Per- Mis- Auto- Total mobile improve- sonal Total Credit cellaneous Total mobile paper ment loans unions lenders1 dealers Mobile Other loans homes 23,851 9,218 4,343 232 10,058 8,289 7,324 965 9,791 24,796 9,342 4,925 214 10,315 9,315 8,255 1,060 10,815 24,576 8,627 5,069 192 10,688 10,216 9,003 1,213 11,484 26,074 9,003 5,424 166 11,481 11,717 10,300 1,417 12,018 27,846 9,412 5,775 174 12,485 13,722 12,028 1,694 13,116 27,678 9,044 2,464 3,237 199 12,734 15,088 12,986 2,102 13,900 28,883 9,577 2,561 3,052 247 13,446 17,021 14,770 2,251 14,151 32,088 10,174 2,916 3,589 497 14,912 19,511 16,913 2,598 15,950 37,243 11,927 3,378 4,434 917 16,587 22,567 19,609 2,958 18,132 38,925 12,435 3,570 4,751 993 17,176 25,216 22,116 3,100 19,473 38,921 12,345 3,573 4,662 1,073 17,268 25,085 21,792 3,293 17,678 38,901 12,458 3,597 4,658 1 ,054 17,134 25,204 21,893 3,311 17.851 38,803 12,462 3.603 4,611 1,021 17,106 25,195 21,975 3,220 18,272 38,925 12,435 3,570 4,751 993 17,176 25,216 22,116 3,100 19,473 38,340 12,315 3,559 4,642 967 16.857 25,032 21.966 3,066 18,804 38,194 12,406 3,539 4,580 923 16,746 25,213 22,089 3,124 18,154 37,910 12,371 3,519 4,427 903 16,690 25,506 22,227 3,279 17,878 37,746 12,349 3,513 4,366 867 16,651 25,623 22,415 3,208 17,768 37,711 12,406 3.507 4,315 833 16,650 25,917 22,674 3,243 17.852 37,828 12,571 3.508 4,288 807 16,654 26,478 23,186 3,292 17,887 38,177 12,793 3,503 4,258 778 16,845 26,837 23,507 3,330 17,920 38,340 12,982 3.498 4,251 741 16,868 27,348 24,043 3,305 18,130 38.375 13,066 3.499 4,246 706 16.858 27,880 24,510 3,370 18,326 i Savings and loan associations and mutual savings banks. See also NOTE to table at top of preceding page. FINANCE RATES ON SELECTED TYPES OF INSTALMENT CREDIT (Per cent per annum) Commercial banks Finance companies MMMooonnnttthhh NNeeww MMoobbiillee OOtthheerr PPeerrssoonnaall CCrreeddiitt-- Automobiles Other aauuttoommoo-- hhoommeess ccoonnssuummeerr llooaannss ccaarrdd Mobile consumer bbiilleess ((8844 mmooss..)) ggooooddss ((1122 mmooss..)) ppllaannss homes goods ((3366 mmooss..)) ((2244 mmooss..)) New Used 1973—Sept 10.44 11.06 12.67 12.96 17.23 12.28 16.98 12.90 18.69 Oct 10.53 10.98 12.80 13.02 17.23 12.34 17.11 Nov 10.49 11.19 12.75 12.94 17.23 12.40 17.21 "nVn is! 77 Dec 10.49 11.07 12.86 13.12 17.24 12.42 17.31 1974—Jan 10.55 11.09 12.78 12.96 17.25 12.39 16.56 13.24 18.90 Feb 10.53 11.25 12.82 13.02 17.24 12.33 16.62 Mar 10.50 10.92 12.82 13.04 17.23 12.29 16.69 * i 3" i 5" 18!69* Apr 10.51 11.07 12.81 13.00 17.25 12.28 16.76 May 10.63 10.96 12.88 13.10 17.25 12.36 16.86 13.07 18.90 June 10.81 11.21 13.01 13.20 17.23 12.50 17.06 July 10.96 11.46 13.14 13.42 17.20 12.58 17.18 " i 3 * 21" 'i9!24* Aug 11.15 11.71 13.10 13.45 17.21 12.67 17.32 Sept 11.31 11.72 13.20 13.41 17.15 12.84 17.61 13.42 19.30 Oct 11.53 11.94 13.28 13.60 17.17 12.97 17.78 Nov 11.57 11.87 13.16 13.47 17.16 13.06 17.88 * i3!60* i 9! 49 Dec 11.62 11.71 13.27 13.60 17.21 13.10 17.89 1975—Jan 11.61 11.66 13.28 13.60 17.12 13.08 17.27 13.60 19.80 Feb 11 .51 12.14 13.20 13.44 17.24 13.07 17.39 Mar 11 .46 11.66 13.07 13.40 17.15 13.07 17.52 13] 59 'io.'oo' Apr 11 .44 11.78 13.22 13.55 17.17 13.07 17.58 May 11 .39 11.57 13.11 13.41 17.21 13.09 17.65 13.57 19.63 June 11 .26 12.02 13.10 13.40 17.10 13.12 17.67 July 11 .30 11 .94 13.13 13.49 17.15 13.09 17.69 i 3! 7 8 19! 87 Aug 11 .31 11 .80 13.05 13.37 17.14 13.10 17.70 Sept 11.33 11.99 13.06 13.41 17.14 13.18 17.73 NOTE.—Rates are reported on an annual percentage rate basis as specified maturities; finance company rates are weighted averages for specified in Regulation Z (Truth in Lending) of the Board of Governors. purchased contracts (except personal loans). For back figures and descrip- Commercial bank rates are "most common" rates for direct loans with tion of the data, see BULLETIN for Sept. 1973. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • CONSUMER CREDIT A 47 INSTALMENT CREDIT EXTENDED AND REPAID (In millions of dollars) Type Holder Period Total Automobile Other Home Personal Commercial Finance Other Retail paper consumer improve- loans banks companies financial outlets goods paper ment loans lenders Extensions 196 7 87,171 26,320 29,504 2,369 28,978 31,382 26,461 11,238 18,090 196 8 99,984 31,083 33,507 2,534 32,860 37,395 30,261 13,206 19,122 196 9 109,146 32,553 38,332 2,831 35,430 40,955 32,753 15,198 20,240 197 0 112,158 29,794 43,873 2,963 35,528 42,960 31,952 15,720 21,526 197 1 124,281 34,873 47,821 3,244 38,343 51,237 32,935 17,966 22,143 197 2 142,951 40,194 55,599 4,006 43,152 59,339 38,464 20,607 24,541 197 3 165,083 46,453 66,859 4,728 47,043 69,726 43,221 23,414 28,722 197 4 166,478 42,756 71,077 4,650 47,995 69,554 41,809 24,510 30,605 1974—Sept. 14,089 3,835 5,935 302 4,017 6,050 3,408 2,079 2,552 Oct. 13,626 3,369 5,948 348 3,961 5,600 3,229 2,160 2,637 Nov. 12,609 3,062 5,700 321 3,526 5,390 2,823 1 ,863 2,533 Dec. 12,702 3,205 5,798 294 3,405 5,012 3,240 1 ,901 2,549 1975—Jan.. 12,859 3,348 5,430 289 3,792 5,368 3,068 2,048 2,375 Feb., 13,465 3,856 5,561 302 3,746 5,649 3,195 2,104 2,517 Mar. 12,797 3,419 5,535 339 3,504 5,357 2,872 2,044 2,524 Apr. 13,181 3,454 5,584 313 3,830 5,457 3,145 2,142 2,437 May 13,149 3,467 5,757 334 3,591 5,473 2,985 2,032 2,659 June 13,959 3,752 5,976 373 3,858 5,772 3,316 2,141 2,730 July. 14,378 4,073 5,927 378 4,000 5,959 3,424 2,361 2,634 Aug. 14,358 3,932 6,077 349 4,000 6,047 3,386 2,178 2,747 Sept 14.973 4,173 6,342 372 4,086 6,289 3,459 2,367 2,858 Repayments 196 7 83,988 26,534 27,847 2,202 27,405 29,549 26,681 10,337 17,421 196 8 91,667 27,931 31,270 2,303 30,163 32,611 28,763 11,705 18,588 196 9 99,786 29,974 34,645 2,457 32,710 36,470 30,981 13,193 19,142 197 0 107,199 30,137 40,721 2,506 33,835 40,398 31,705 14,354 20,742 197 1 115,050 31,393 44,933 2,901 35,823 45,395 31,730 16,033 21,892 197 2 126,914 34,729 49,872 3,218 39,095 50,796 35,259 18,117 22,742 197 3 144,978 39,452 59,409 3,577 42,540 60,014 38,066 20,358 26,540 197 4 157,791 42,197 66,598 3,840 45,156 66,539 40,127 21,861 29,264 1974—Sept. 13,412 3.604 5,700 279 3,829 5,808 3,371 1,723 2,510 Oct. 13,224 3,470 5,499 321 3,934 5,542 3,250 1,962 2,470 Nov. 13,009 3,423 5,561 325 3,700 5,671 2,981 1 ,860 2,497 Dec. 13,516 3,668 6,037 341 3,470 5,803 3,308 1,822 2,583 1975—Jan.. 13,260 3,534 5,549 336 3,841 5,669 3,331 1,827 2,433 Feb., 13,228 3.605 5,632 350 3,641 5,747 3,134 1,824 2,523 Mar. 13,234 3,772 5,708 357 3,397 5.924 2,971 1 ,782 2,557 Apr. 13,423 3,719 5,632 369 3,703 5,769 3,263 1 ,947 2,444 May 13,274 3,625 5,694 349 3,606 5,737 3,169 1 ,894 2,474 June 13,537 3,728 5,799 358 3,652 5,774 3,307 1,806 2,650 July. 13,509 3,690 5,860 348 3,611 5,749 3,227 1,957 2,576 Aug. 13,858 3,820 5,826 358 3,854 5,941 3,366 1 ,952 2,599 Sept. 13,916 3,727 6,090 350 3,749 5.925 3,363 1,906 2,722 Net change 1967 3,183 -214 1,657 167 1,573 1,833 -220 901 669 1968 8,317 3,152 2,237 231 2,697 4,784 1,498 1,501 534 1969 9,360 2,579 3,687 374 2,720 4,485 1,772 2,005 1,098 1970 4,959 -343 3,152 457 1,693 2,977 -168 1,366 784 1971 9,231 3,480 2,888 343 2,520 5,842 1,205 1,933 251 1972 16,037 5,465 5,727 788 4,057 8,543 3,205 2,490 1,799 1973 :... 20,105 7,001 7,450 1,151 4,503 9,712 5,155 3,056 2,182 1974 8,687 559 4,479 810 2,839 3,015 1,682 2,649 1,341 1974—Sept 677 231 235 23 188 242 37 356 42 Oct 402 -101 449 27 27 58 -21 198 167 Nov -400 -361 139 -4 -174 -281 -158 3 36 Dec -814 -463 -239 -47 -65 -791 -68 79 -34 1975—Jan -401 -186 -119 -47 -49 -301 -263 221 -58 Feb 237 251 -71 -48 105 -98 61 280 -6 Mar -437 -353 -173 -18 107 -567 -99 262 -33 Apr -242 -265 -48 -56 127 -312 -118 195 -7 May -125 -158 63 -15 -15 -264 -184 138 185 June 422 24 177 15 206 -2 9 335 80 July 869 383 67 30 389 210 197 404 58 Aug 500 112 251 -9 146 106 20 226 148 Sept 1,057 446 252 22 337 364 96 461 136 NOTE.—Monthly estimates are seasonally adjusted and include adjust- stalment paper, and certain other transactions may increase the amount ments for differences in trading days. Annual totals are based on data of extensions and repayments without affecting the amount outstanding. not seasonally adjusted. For back figures and description of the data, see "Consumer Credit," Estimates are based on accounting records and often include finance Section 16 (New) of Supplement to Banking and Monetary Statistics, 1965 charges. Renewals and refinancing of loans, purchases and sales of in- and BULLETINS for Dec. 1968 and Oct. 1972. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 48 INDUSTRIAL PRODUCTION: S.A. • NOVEMBER 1975 MARKET GROUPINGS (1967 = 100) 1 p 9 ro 6 - 7 1974 1974 1975 Grouping p ti o o r n - av ag er e - Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June Julyr Aug.r Sept.? Oct. Total index 100.0 124.8 124.8 121.7 117.4 113.7 111 .2 110.0 109.9 110.1 111.1 112.2 114.0 Products, total 62.21 123.1 122.9 121.4 118.7 115.4 113.7 112.4 112.9 113.4 114.2 115.3 115.8 Final products 48.95 121.7 122.3 120.9 118.2 114.9 113.3 112.2 112.6 113.7 114.5 115.7 116.0 Consumer goods v 28.53 128.8 128.2 126.3 123.4 120 118.8 118.2 119.6 121 .2 123.3 125.5 125.5 Equipment 20.42 111.7 114.0 113.2 110.7 107.8 105.3 103.9 103.0 102.9 102.2 102.2 102.5 Intermediate products 13.26 128.3 125.3 123.0 120.5 117.6 115.2 112.7 113.4 112.4 112. 114.3 115.2 Materials 37.79 127.4 128.1 122.1 114.8 110.5 107.4 105.9 105.2 104.9 106.0 106.8 111.2 Consumer goods Durable consumer goods 7.86 127.9 126.5 119.7 110.1 104.0 101.0 103.1 107.8 110.5 113.2 115.9 116.1 Automotive products 2.84 110.0 114.7 102.1 87.5 80.3 78.2 86. 93.6 97.6 103.4 106.9 105.9 Autos 1.87 94.9 108.4 91.0 69. 62.6 58.9 73. 82.4 86.3 93.2 97.7 96.8 Auto parts and allied goods... .97 139.0 126.9 123.6 121 .5 114.4 115.5 113.2 115.2 119.3 122. 124.8 123.2 Home goods 5.02 138.0 133.2 129.7 123.0 117.5 114.0 112.3 115.9 117.8 118.8 121 .0 121.9 Appliances, TV, and radios 1.41 132.0 120.9 115.3 102.5 94.4 89.0 85.0 96.7 102.4 103.5 104.7 107.3 Appliances and A/C .92 148.8 139.5 131.9 119.8 108.0 104.8 99.1 114.2 118.4 118.3 118.9 123.5 TV and home audio .49 76.0 Carpeting and furniture 1.08 153.5 151.8 144.7 143.8 135. 132.3 127.9 127.8 128.6 131 .1 135.5 136.0 Misc. home goods 2.53 134.7 132.2 131.4 125.5 123.0 120.1 121.0 121.4 121.7 122.1 124.0 124 Nondurable consumer goods 20.67 129.2 128.9 128.8 128.4 126.3 125.5 124.1 124.0 125.3 127.2 129.0 129.2 Clothing 4.32 109.0 104.5 103.1 102.0 95.0 94.5 90, 89.2 94.4 97.7 101 .6 101.6 Consumer staples 16.34 134.5 135.4 135.6 135.5 134.5 133.6 132.7 133.3 133.5 134.9 136.3 136.5 Consumer foods and tobacco.. 8.37 125.4 125.2 126.2 125.3 123.3 123.2 120.7 122.7 122.4 124.1 125.5 125.7 Nonfood staples 7.98 144.0 146. 145.3 146.2 146.4 144.5 145.3 144.3 145.3 146.4 147.7 147.8 Consumer chemical products 2.64 158.4 159.8 155.2 159.1 160.6 157.1 158.2 157.6 158.4 159.2 161.2 160.6 Consumer paper products... 1.91 125.2 128.5 127.4 126.7 122.0 121.9 120.9 118.4 122.8 123.3 124.1 126.1 Consumer fuel and lighting., 3.43 143. 145.4 147.9 147.3 149.2 147.2 149.0 148.6 147.8 149.4 150.4 150.2 Residential utilities 2.25 153.7 155.5 159.3 159.0 159.9 159.7 163.1 161 .9 160.9 161 .3 160.5 161.0 Equipment Business equipment 12.74 129.4 132.0 131.0 127.1 122.3 119.3 117.0 115. 115.0 113.9 113.9 114.8 Industrial equipment 6.77 128.7 130.9 129.3 126.7 122.9 120.4 118.8 116.4 115.3 114.0 113.3 113.5 Building and mining equip.... 1.45 136.0 141.2 140.1 137.4 138.4 137.0 137.7 132.3 131.7 127.7 126.9 128 Manufacturing equipment.... 3.85 121.7 122.5 119.4 116.5 111. 109.4 106.6 105.6 105.0 104.3 105.5 105.1 Power equipment 1.47 139.9 142.8 144.5 142.6 136.6 132.1 131.8 128.9 126.2 125. 120.3 121 . Commercial, transit, farm equip., 5.97 130.3 133.2 132.9 127.6 121.6 118.0 115.1 114.2 114.7 113.9 114.6 116.3 Commercial equipment 3.30 141.1 144.1 143.1 139.3 135.2 130.4 127.8 123.2 121.5 120.7 123.0 123.2 Transit equipment 2.00 109.6 111.2 109.8 102.9 91 .8 91 .5 88.8 92.2 98.6 98.0 98.0 101.5 Farm equipment .67 138.7 145.4 151.9 143.7 143.8 135.9 130.2 135.7 129.0 127.3 122.9 127.0 Defense and space equipment 7.68 82.3 84.1 83.7 83.4 83.8 82.4 82.1 82.4 82.7 82.9 82.6 82.3 5.15 81.2 82.5 81.8 81.3 81.5 80.7 80.3 80.7 82.0 82.0 82 81.9 Military products Intermediate products 5.93 129.6 123.5 121 .3 118.3 115.7 112.1 109.1 110.1 107.6 106.8 108.0 109. Construction products 7.34 127.3 126.8 124.2 122.5 119.2 118.4 115.6 116.1 116.2 117.5 119.3 120.: Misc. intermediate products Materials 20.91 127.3 129.3 123.5 114.2- 110.3 107.0 104.7 101.6 100.2 99.8 100.3 106.2 4.75 112.1 115.2 104.1 91.7 83.7 82.1 84.7 86.0 87.7 90.8 92.8 101.7 Durable goods materials 5.41 123.8 124.0 122.2 118.3 116.9 112.0 108.7 104.6 102.1 97.3 96.8 100.6 Consumer durable parts 10.75 135.9 138.3 132.7 122.9 118.8 115.4 111.4 106.9 104.7 105.1 105.3 110.9 Equipment parts Durable materials nec 13.99 128.5 126.8 122.1 116.2 109.2 105.7 105.3 107.9 109.5 112.3 114.0 117.7 Nondurable goods materials 8.58 139.8 138.1 131.1 122.9 112.9 108.5 106.2 110.4 113.2 117.0 118.9 124.6 Textile, paper, and chem. mat... 5.41 110.6 108.9 107.8 105.7 103.3 101.1 103.9 104.0 103.7 105.1 106.2 106.8 Nondurable materials n.e.c 2.89 122.6 126.4 112.7 113.0 117.8 118.2 118.0 117.5 118.0 119.5 121.1 117.1 Fuel and power, industrial Supplementary groups Home goods and clothing 9.34 124.6 120.0 117.4 113.2 107.1 105.0 102.3 103.6 106.9 109. 112.0 112.5 Containers 1.82 139.4 131.5 127.6 120.3 126.1 119.9 122.3 124.2 124.3 128.4 132 133.3 Gross value of products in market structure (In billions of 1963 dollars) Products, total 286.3 445.7 439.0 426.7 416.4 410.1 405.1 409.6 408.6 414.5 416.1 418.7 Final products 221.4 346.5 341.3 331.0 322.3 317.7 315.3 319.0 319.4 325.0 325.2 326. Consumer goods 156.3 233.7 228.9 222.3 216.4 213.7 213.2 217.6 217.8 223.6 224.9 226. Equipment 65.3 112.7 112.4 108. 105.9 103.9 102.2 101.4 101.5 101.3 100.5 101.0 Intermediate products 64.9 99.4 97.4 95.8 94.3 92.3 90.0 90.5 89.2 89.6 91.1 91. For NOTE see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INDUSTRIAL PRODUCTION: S.A. A 49 INDUSTRY GROUPINGS (1967 = 100) 11 pp 99 rroo 6677 -- 11997744 1974 1975 GGrroouuppiinngg pp ttii oo oo rr nn -- aa aa vv gg ee ee rr -- Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug.r Sept." Oct.4 Manufacturing 88.55 124.4 124.6 120.9 116.1 111.7 109.2 107.7 107.9 108.2 109.5 110.6 112.6 114.2 114. Durable 52.33 120.7 121.6 117.9 112.2 108.2 104.8 103.5 103.3 102.5 103.2 103.5 105.4 106.9 106. Nondurable 36.22 129.7 128.9 125.4 121 .9 117.0 115.6 113.7 114.8 116.1 118.6 120.8 123.1 124.9 126. Mining and utilities 11.45 127.3 128.5 125.9 125.7 127.0 127.3 128.8 128.1 126.5 126.8 127.4 126.9 128.2 128. Mining 6.37 109.3 110.5 105.0 104.4 107.0 108.6 108.9 108.5 105.9 106.3 106.4 104.8 106.1 106. Utilities 5.08 149.9 151.2 152.3 152.6 153.0 150.9 154.0 153.1 152.3 152.6 153.7 154.5 156.0 156. Durable manufactures Primary and fabricated metals 12.55 127.5 127.6 124.4 116.0 112.4 107.7 105.1 103.2 99.8 100.8 100.7 104.1 105.0 104. Primary metals 6.61 124.1 126.0 121.0 108.6 107.2 102.1 98.1 95.0 89.9 91 .8 92.8 96.5 95.8 95. Iron and steel, subtotal 4.23 119.9 123.9 117.7 107.9 110.6 105.0 103.1 99.4 90.1 88.7 87.0 90.4 90.0 89. Fabricated metal products 5.94 131 .4 129.6 128.2 124.1 118.2 113.7 112.9 112.4 100.9 110.9 109.7 112.7 115.3 115. Machinery and allied goods 32.44 116.3 118.4 114.9 109.6 105.4 102.4 101.5 101.9 101.7 102.3 102.4 103.9 105.5 105. Machinery 17.39 128.1 131.1 128.9 124.8 119.6 115.6 112.2 110.8 109.0 108.2 108.4 110.0 111.5 111. Nonelectrical machinery 9.17 133.8 137.4 135.1 132.5 126.7 123.6 119.3 116.9 113.7 112.3 112.9 114.9 116.3 116. Electrical machinery 8.22 125.2 124.0 121.7 116.3 111 .5 106.6 104.3 104.0 103.8 103.8 103.4 104.5 106.1 106. Transportation equipment 9.29 96.9 102.1 93.7 83.6 78.9 77.1 81.0 84.7 87.6 90.5 91 .0 92.9 95.4 94. Motor vehicles and parts 4.56 113.2 123.0 107.1 86.4 78.2 77.6 85.4 93.1 95.0 100.0 103.2 107.2 111.3 111. Aerospace and misc. trans, eq... 4.73 81.1 81.9 80.9 80.9 79.5 76.6 76.7 76.6 80.4 81 .3 79.3 79.2 80.1 79. Instruments 2.07 143.9 142.0 142.3 139.5 139.1 134.2 130.6 131 .1 129.7 130.9 132.4 131 .8 133.6 134. Ordnance, private and Govt 3.69 86.1 87.2 86.6 86.6 86.2 86.9 86.7 86.7 86.7 87.7 86.4 86.1 86.2 85. Lumber, clay, and glass 4.44 123.6 117.8 113.7 111.0 109.6 104.6 102.6 104.8 105.9 107.0 108.3 109.4 111.6 112. Lumber and products 1.65 120.1 109.3 105.2 101.3 99.9 99.6 99.8 104.1 108.0 110.3 112.0 112.0 112.8 Clay, glass, and stone products.... 2.79 125.7 122.9 118.8 116.9 115.3 107.8 104.2 105.4 104.7 105.1 106.2 107.9 111.0 Furniture and miscellaneous 2.90 136.1 136.7 129.0 128.4 120.0 119.6 118.7 117.6 119.7 120.1 121.2 122.3 123.4 123. Furniture and fixtures 1.38 126.9 125.5 120.5 120.4 110.6 110.6 106.7 105.6 109.6 107.9 109.4 109.2 110.2 Miscellaneous manufactures 11..5522 114444..44 114466..99 136.9 113355..77 112288..99 112288..00 129.7 112288..55 112299..00 113311 ..11 113311 ..88 113344..33 113355..44 Nondurable manufactures Textiles, apparel, and leather 6.90 108.9 105.1 101.9 96.3 88.9 89.6 87.5 90.4 93.2 94.9 97.4 99.4 102.6 104. Textile mill products 2.69 122 J 119.1 112.8 102.9 95.6 93.3 96.8 100.4 103.8 106.9 110.7 114.9 11 1199..77 Apparel products 33..3333 105.4 102.8 100.1 98.0 94.0 92.6 86.4 88.2 90.9 91 .5 92.9 94.0 Leather and products ..8888 77.3 70.6 74.7 69.7 66.1 66.7 63.5 68.0 70.0 71 .2 73.5 72.5 78.1 Paper and printing 7.92 121.0 120.8 115.7 112.3 108.2 106.6 104.2 102.4 103.9 107.3 107.3 110.6 113.0 114. i Paper and products 3.18 134.0 133.9 124.3 116.1 114.3 109.5 104.5 105.8 105.8 109.5 111.7 1 16.4 121 .1 Printing and publishing 4.74 112.3 111.9 110.0 109.8 104.1 104.7 104.0 100.2 102.6 105.9 104.4 106.8 107.5 106. Chemicals, petroleum, and rubber.... 11.92 151.7 152.4 146.5 141.6 136.5 132.4 130.2 131.0 132.5 136.2 140.2 143.5 145.5 147.. Chemicals and products 7.86 154.3 155.9 148.3 143.1 139.0 134.6 133.6 132.8 135.7 138.2 143.4 146.0 148.7 150. Petroleum products 1.80 124.0 125.4 127.0 125.8 126.8 123.7 120.1 120.2 118.5 122.4 124.6 126.5 127.0 127J Rubber and plastics products 2.26 164.4 161.8 155.7 148.9 135.4 132.0 126.8 133.5 132.7 140.1 141 .6 147.7 149.9 Foods and tobacco 9.48 124.8 123.7 123.8 123.5 120.0 121.3 120.0 122.4 122.4 123.5 124.8 124.9 125.5 126. Foods 8.81 126.2 124.8 125.4 125.7 121.2 122.3 121.3 122.9 123.8 125.1 126.3 126.3 126.9 127.< Tobacco products ..6677 106.4 111100..33 103.8 96.2 104.7 108.4 102.6 115.9 103.8 110022..22 110044..88 110055..77 Mining Metal, stone, and earth minerals 1.26 117.2 121.3 120.7 117.9 119.1 116.2 113.4 113.3 106.2 101.5 105.0 108.4 106.3 106.. Metal mining .51 129.2 141.4 136.8 134.7 133.8 131 .1 125.4 125.8 114.8 110.6 110.3 122.3 1 18.9 Stone and earth minerals .76 109.1 107.5 109.8 106.4 109.0 106.1 105.1 104.7 100.4 95.3 101 .4 98.8 97.7 Coal, oil, and gas 5.11 107.3 107.8 101.2 101.1 103.9 106.8 107.7 107.4 105.8 107.6 106.7 103.9 106.0 106.. Coal .69 105.1 110.3 67.6 85.3 111.3 117.5 117.4 112.2 113.6 120.4 120.6 101 .9 113.6 114.! Oil and gas extraction 4.42 107.7 107.4 106.4 103.6 102.9 105.0 106.1 106.6 104.5 105.5 104.5 104.2 104.8 105.( Utilities Electric 3.90 159.5 116611..22 162.9 163.0 162.5 161.1 165.4 164.1 116633..00 116633..33 116644..77 116655..66 Gas 11..1177 111177..99 1 NOTE.—Data for the complete year of 1972 are available in a pamphlet Published groupings include series and subtotals not shown sepa- Industrial Production Indexes 1972 from Publications Services, Division rately. Figures for individual series and subtotals are published in the of Administrative Services, Board of Governors of the Federal Reserve monthly Industrial Production release. System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 50 BUSINESS ACTIVITY; CONSTRUCTION • NOVEMBER 1975 SELECTED BUSINESS INDEXES (1967= 100, except as noted) Industrial production Manu- Prices4 facturing 2 In- Ca- Market dustry pacity Nonagutiliza- Con- ricul- Period Products tion struc- tural Total Whole- Total in mfg. tion em- Em- Pay- retail Con- sale (1967 con- ploy- ploy- rolls sales3 sumer com- Total Mate- Manu- output tracts ment— ment modity Inter- rials factur- = 100) Total i Con- Equip- mediate ing Total sumer ment goods 195 5 58.5 56.6 54.9 59.5 48.9 62.6 61.5 58.2 90.0 76.9 92.9 61.1 59 80.2 87.8 195 6 61.1 59.7 58.2 61.7 53.7 65.3 63.1 60.5 88.2 79.6 93.9 64.6 61 81.4 90.7 195 7 61.9 61.1 59.9 63.2 55.9 65.3 63.1 61.2 84.5 80.3 92.2 65.4 64 84.3 93.3 195 8 57.9 58.6 57.1 62.6 50.0 63.9 56.8 56.9 75.1 78.0 83.9 60.3 64 86.6 94.6 195 9 64. 64.4 62.7 68.7 54. 70.5 65.5 64.1 81.4 81.0 88.1 67.8 69 87.3 94.8 196 0 66.2 66.2 64. 71.3 56.4 71.0 66.4 65.4 80.1 82.4 88.0 68.8 70 88.7 94.9 196 1 66.7 66.9 65.3 72.8 55.6 72.4 66.4 65.6 77.6 82.1 84.5 68.0 70 89.6 94.5 196 2 72.2 72.1 70.8 77.7 61.9 76.9 72.4 71.4 81.4 84.4 87.3 73.3 75 90.6 94.8 196 3 76.5 76.2 74.9 82.0 65.6 81.1 77.0 75.8 83.0 86.1 86.1 87.8 76.0 79 91.7 94.5 196 4 8.1.7 81.2 79.6 86. 70. 87.3 82.6 81.2 85.5 89.4 88.6 89.3 80.1 83 92.9 94.7 196 5 89.2 86.8 93.0 78.7 93.0 91.0 89.1 89.0 93.2 92.3 93.9 88.1 91 94.5 96.6 196 6 97.9 96.8 96.1 98.6 93.0 99.2 99.8 98.3 91.9 94.8 97.1 99.9 97.8 97 97.2 99.8 196 7 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 87.9 100.0 100.0 100.0 100.0 100 100.0 100.0 196 8 105.7 105. 105.8 106.6 104.7 105.7 105.7 105.7 87.7 113.2 103.2 101.4 108.3 109 104.2 102.5 196 9 110.7 109.7 109.0 111. 106.1 112.0 112.4 110.5 86.5 123.7 106.9 103.2 116.6 114 109.8 106.5 197 0 106.6 106.0 104.5 110.3 96.3 111.7 107.7 105.2 78.3 123.1 107.7 98.1 114.1 120 116.3 110.4 197 1 106.8 106.4 104.7 115.7 89.4 112.6 107.4 105.2 75.0 145.4 108.1 94.2 116.7 122 121.2 113.9 197 2 115.2 113.8 111 123.6 95.5 121.1 117.4 114.0 78.6 165.3 111.9 97.6 131.5 142 125.3 119.8 197 3 125.6 123.4 121 .3 131 .7 106.7 131 .1 129.3 125.2 83.0 181 .3 rl 16.8 H03.2 ''149.2 133.1 134.7 197 4 124.8 123.1 121 .7 128.8 111 .7 128.3 127.4 124.4 78.9 168.6 r 119.1 102.1 r157.1 147.7 160.1 1974— O Se c p t t . . . 1 1 2 2 5 4 . . 6 8 1 1 2 2 3 2 . . 6 9 1 1 2 2 2 2 . . 6 3 1 1 2 28 8 . . 8 2 1 11 1 4 3 . . 0 8 1 1 2 2 7 5 . . 6 3 1 1 2 2 9 8 . . 3 1 1 1 2 2 5 4 . . 5 6 ) 579.4 1 1 4 8 8 7 . . 0 0 1 1 1 1 9 9 . . 7 6 1 10 0 1 2 . . 4 4 1 1 6 6 2 2 . . 6 4 1 1 7 7 5 6 1 15 5 1 3 . . 0 7 1 16 7 7 0 . . 2 2 Nov. 121 .7 121 .4 120.9 126.3 113.2 123.0 122.1 120.9 75.7 154.0 119.0 99.3 157.5 170 154.3 171.9 Dec., 117.3 118.7 118.2 123.4 110.7 120.5 114.8 116.1 176.0 118.0 96.5 153.2 171 155.4 171.5 1975—Jan.. 113.7 115.4 114.9 120.1 107.8 117.6 110.5 111 .7 135.0 117.4 93.9 149.5 176 156.1 171 .8 Feb.. 111 .2 113.7 113.3 118.8 105.3 115.2 107.4 109.2 68.2 139.0 116.6 91.2 143.5 179 157.2 171 .3 Mar. 110.0 112.4 112.2 118.2 103.9 112.7 105.9 107.7 153.0 116.1 90.3 143.3 176 157.8 170.4 Apr., 109.9 112.9 112.6 119.6 103.0 113.4 105.2 107.9 189.0 116.1 89.9 144.7 179 158.6 172.1 May, 110.1 113.4 113.7 121 .2 102.9 112.4 104.9 108.2 67.0 182.0 116.2 90.1 144.7 184 159.3 173.2 June, 111 .1 114.2 114.5 123.3 102.2 112.8 106.0 109.5 174.0 115.9 89.8 146.4 186 160.6 173.7 July7 112.2 115.3 115.7 125.5 102.2 114.3 106.8 110.6 165.0 116.4 89.7 148.7 190 162.3 175.7 Aug. 114.0 115.8 116.0 125.5 102.5 115.2 111.2 112.6 69.0 208.0 116.9 90.9 154.2 191 162.8 176.7 Sept. 116.0 116.8 116.9 126.6 103.4 116.7 114.6 114.2 157.0 117.3 92.0 157.1 189 163.6 177.7 Oct.. 116.5 117. 1 117.1 127.4 102.8 117.3 115.2 114.7 117.7 92.7 159.0 191 178.9 1 Employees only: excludes personnel in the Armed Forces. Construction contracts: McGraw-Hill Informations Systems Company 2 Production workers only. Revised back to 1973. F.W. Dodge Division, monthly index of dollar value of total construction 3 F.R. index based on Census Bureau figures. contracts, including residential, nonresidential, and heavy engineering. 4 Prices are not seasonally adjusted. Latest figure is final. Employment and payrolls: Based on Bureau of Labor Statistics data; 5 Figure is for 3rd quarter 1974. includes data for Alaska and Hawaii beginning with 1959. NOTE.—All series: Data are seasonally adjusted unless otherwise noted. Prices: Bureau of Labor Statistics data. Capacity utilization: Based on data from Federal Reserve, McGraw- Hill Economics Department, and Dept. of Commerce. CONSTRUCTION CONTRACTS /> 3 PRIVATE HOUSING PERMITS (In millions of do] ;, except as noted) 1974 1975 TTyyppee ooff oowwnneerrsshhiipp aanndd 11997733 11997744 ttyyppee ooff ccoonnssttrruuccttiioonn Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Total construction contracts 1 99,304 93,076 8,359 7,227 6,179 7,304 5,100 4,955 6,574 9,598 9,143 9,324 9,044 10,037 7,692 By type of ownership: Public 26,563 32,209 3,273 2,720 2,391 2,496 2,254 2,031 2,182 2,768 2,875 3,891 3,784 3,040 2,725 Private 1 72,741 60,867 5,689 4,508 3,788 4,809 2,846 2,924 4,393 6,830 6,268 5,432 5,260 6,997 4,967 By type of construction: Residential building 1 45,696 34,174 2,503 2,457 1,931 1,715 1,562 1,583 2,316 3,029 3,073 3,116 3,093 2,784 2,966 Nonresidential building 31,534 33,859 3,320 2,710 2,618 2,451 2,233 2,199 2,402 2,987 2,877 3,169 3,165 2,666 2,526 Nonbuilding 22,074 25,042 2,536 2,061 1,630 3,139 1,305 1,172 1,856 3,582 3,193 3,040 2,786 4,587 2,200 Private housing units authorized... 11,,882200 11,,007744 853 811 770 837 689 701 677 837 912 949 1,042 r995 1,072 (In thousands, S.A., A.R.) 1 Because of improved procedures for collecting data for 1-family homes, NorE.—Dollar value of construction contracts as reported by the some totals are not strictly comparable with those prior to 1968. To im- McGraw-Hill Informations Systems Company, F.W. Dodge Division. prove comparability, earlier levels may be raised by approximately 3 per Totals of monthly data may differ from annual totals because adjustments cent for total and private construction, in each case, and by 8 per cent for are made in accumulated monthly data after original figures have been residential building. published. Private housing units authorized are Census Bureau series for 14,000 reporting areas with local building permit systems. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • CONSTRUCTION A 51 VALUE OF NEW CONSTRUCTION ACTIVITY (In millions of dollars) Private Public 2 Nonresidential Period Total Resi- Buildings Mili- High- C v o a n ti s o e n r - Total dential Total tary way and Other Total Indus- Com- b O u t i h l e d r - Other de m ve e l n o t ptrial mercial ings 1 1966 76,002 51,995 25,715 26,280 6,679 6,879 5,037 7,685 24,007 727 8,405 2,194 12,681 1967 77,503 51,967 25j568 26,399 6,131 6,982 4,993 8,293 25,536 695 8,591 2,124 14,126 1968 86,626 59,021 30,565 28,456 6,021 7,761 4,382 10,292 27,605 808 9,321 1,973 15,503 1969 93,728 65,404 33,200 32,204 6,783 9,401 4,971 11.049 27,964 879 9,250 1,783 16,052 197 0 94,167 66,071 31,864 34,207 6,538 9,754 5,125 12,790 28,096 718 9,981 1,908 15,489 197 1 109,950 80,079 43,267 36,812 5,423 11,619 5,437 14,333 29,871 901 10,658 2,095 16,217 197 2 124,077 93,893 54,288 39,605 4.676 13,462 5,898 15,569 30,184 1,087 10,429 2,172 16,496 197 3 135,456 102,894 57,623 45,271 6.243 15,453 5,888 17,687 32,562 1,170 10,559 2,313 18,520 1974r 135,481 97,079 47,044 50,053 7; 902 15,945 5,797 20,409 38,402 1,185 12,083 2,782 22,352 1974—Sept.. 133,299 94,878 45,903 48,975 7,478 15,890 5,739 19,868 38,421 1,180 12,835 2,880 21,526 Oct... 134,466 95,576 44,182 51,394 8,702 16,372 5,701 20,619 38,890 1,103 12,374 3,029 22,384 Nov.. 131,948 93,795 42,503 51,292 8,890 15,939 5,697 20,766 38,153 1,102 11,140 2,999 22,912 Dec.. . 134,047 92,529 41,060 51,469 9,006 15,842 5,571 21.050 41,518 1,169 11,973 3,358 25,018 1975—Jan... 132,274 91,169 39,556 51,613 8,412 15,646 5,903 21,652 41,105 1,223 12,356 2,842 24,684 Feb... 128,862 89,023 38,523 50,500 8,724 14,971 5,883 20,922 39,839 1,319 11,993 3,329 23,198 Mar.. 125,501 85,687 37,999 47,688 7,869 13,032 5,363 21,424 39,814 1,337 11,377 3,024 24,076 Apr.. . 120,892 84,607 37,894 46,713 7,500 12,765 5,636 20,812 36,285 1,473 10,963 2,769 21,080 May. . 121,490 84,044 38,844 45,200 8,197 12,109 5.268 19,626 37,446 1,180 12,227 3,132 20,907 June. , 125,928 84,026 39,834 44,192 7.677 11,756 5,415 19,344 41,902 1,120 12,251 3,529 25,002 July. 126,662 86,029 40,986 45,043 7,714 11,978 5,319 20,032 40,633 1,309 Aug.. 125,888 87,740 42,065 45,675 7,621 12,586 5,511 19,957 38,148 1,383 Sept.*7 130,186 89,509 43,223 46,286 7,688 12,380 5,732 20,486 40,677 1,662 1 Includes religious, educational, hospital, institutional, and other build- NOTE.—Census Bureau data; monthly series at seasonally adjusted ings. annual rates. 2 By type of ownership, State and local accounted for 86 per cent of public construction expenditures in 1974. PRIVATE HOUSING ACTIVITY (In thousands of units) Completions Under construction New 1 -family homes sold (end of period) and for sale 1 Units Median prices (in thousands Mobile of dollars) of Period home units 1- 2-or- 1- 2-or- 1- 2-or- ship- Total family more Total family more Total family more ments family family family For sale For (end of sale period) 196 6 1,165 779 386 217 461 196 21.4 22.8 196 7 1,292 844 448 240 487 190 22.7 23.6 196 8 1,508 899 608 1,320 859 461 318 490 218 24.7 24.6 196 9 1,467 811 656 1,399 807 591 885 350 r535 413 448 228 25.6 27.0 197 0 1,434 813 621 1,418 802 617 922 381 541 401 485 227 23.4 26.2 197 1 2,052 1,151 901 1,706 1,014 692 1,254 505 749 497 656 294 25.2 25.9 197 2 2,357 1,309 1,047 1,971 1,143 828 1,586 640 947 576 718 416 27.6 28.3 197 3 2,045 1,132 913 2,014 1,174 840 1,599 583 1,016 567 620 456 32.5 32.9 197 4 1,337 450 1,692 931 760 1,189 516 673 371 501 407 35.9 36.2 1974—Sept. 1,157 845 313 1,562 899 663 1,372 565 807 258 495 414 36.2 35.7 Oct.. 1,106 792 314 1,627 908 719 1,322 553 769 227 433 409 37.2 35.9 Nov. 1,017 802 215 1,657 893 763 1 ,255 541 714 204 435 404 37.3 36.0 Dec. 682 198 1 ,606 852 754 1,229 545 684 195 382 400 37.4 36.2 1975—Jan.. 999 739 260 1,535 964 571 1 176 522 654 185 404 404 37.2 36.4 Feb., 1,000 733 267 1,320 770 550 156 522 634 219 411 409 37.9 36.6 Mar. 985 775 210 1,305 734 571 1,113 520 593 199 463 396 38.8 36.5 Apr. 980 762 218 1,211 756 455 1,085 515 570 194 570 388 39.2 36.7 May 1,130 887 243 1,276 832 444 1,066 518 548 224 586 '383 '"39.5 36.9 June 1,094 884 210 1,165 785 377 1,044 515 529 210 558 377 38.0 37.2 July' 1,235 935 300 1,244 896 348 1,043 521 522 225 536 381 39.2 37.4 Aug. 1,268 986 282 1,190 818 372 1,049 535 514 235 557 377 38.6 37.8 Sept. 1,240 906 334 1 Merchant builders only. for mobile homes, which are private, domestic shipments as reported by the Mobile Home Manufacturers' Assn. and seasonally adjusted by NOTE.—All series except prices, seasonally adjusted. Annual rates for Census Bureau. Data for units under construction seasonally adjusted by starts, completions, mobile home shipments, and sales. Census data except Federal Reserve. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 52 EMPLOYMENT • NOVEMBER 1975 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT (In thousands of persons, except as noted) Civilian labor force (S.A.) Period i p T n o ( s o N t p t i a u . t S l u l a . t n A i t o i o . o n ) n n a - l la ( b N N o . r o S t . f A i o n r . ) c e ( T l f S a o o b . r t A c o a e r l . ) Total Total E In m c u n p l o l t n o u a y r g a e l r d i 1 - In U pl n o e y m ed - U (p n e e m r S r a m . e A t c p e n e . 2 t l ) n o t y ; industries agriculture 196 9 137,841 53,602 84,240 80,734 77,902 74,296 3,606 2,832 3.5 197 0 140,182 54,280 85,903 82,715 78,627 75,165 3,462 4,088 4.9 197 1 142,596 55,666 86,929 84,113 79,120 75,732 3,387 4,993 5.9 197 2 145,775 56,785 88,991 86,542 81,702 78,230 3,472 4,840 5.6 197 3 148,263 57,222 91,040 88,714 84,409 80,957 3,452 4,304 4.9 197 4 150,827 57,587 93,240 91,011 85,935 82,443 3,492 5,076 5.6 1974—Oct.. 151,593 57,489 94,057 91,844 86,304 82,864 3,440 5,540 6.0 Nov. 151,812 57,991 93,920 91,708 85,689 82,314 3,375 6,019 6.6 Dec., 152,020 58,482 94,015 91,803 85,202 81,863 3,339 6,601 7.2 1975—Jan.. 152,230 58,888 94,284 92,091 84,562 81,179 3,383 7,529 8.2 Feb.. 152,445 59,333 93,709 91,511 84,027 80,701 3,326 7,484 8.2 Mar. 152,646 59,053 94,027 91,829 83,849 80,584 3,265 7,980 8.7 Apr., 152,840 59,276 94,457 92,262 84,086 80,848 3,238 8,176 8.9 May, 153.051 59,101 95,121 92,940 84,402 80,890 3,512 8,538 9.2 June, 153,278 57,087 94,518 92,340 84,444 81,140 3,304 7,896 8.6 July. 153,585 56,540 95,102 92,916 85,078 81,628 3,450 7,838 8.4 Aug. 153,824 57,331 95,331 93,146 85,352 81,884 3,468 7,794 8.4 Sept. 154.052 59,087 95,361 93,191 85,418 81,872 3,546 7,773 8.3 Oct.. 154,256 58,825 95,607 93,443 85,441 82,019 3,422 8,002 8.6 1 Includes self-employed, unpaid family, and domestic service workers. to the calendar week that contains the 12th day; annual data are averages 2 Per cent of civilian labor force. of monthly figures. Description of changes in series beginning 1967 is NOTE.—Bureau of Labor Statistics. Information relating to persons 16 available from Bureau of Labor Statistics. years of age and over is obtained on a sample basis. Monthly data relate EMPLOYMENT IN NONAGRICULTURAL ESTABLISHMENTS, BY INDUSTRY DIVISION (In thousands of persons) Contract Transporta- Period Total M t a u n r u in f g a c- Mining con ti s o t n ru c- ti p o u n bl a i n c d Trade Finance Service G m ov e e n r t nutilities 1969. 70,442 20,167 619 3,525 4,435 14,704 3,562 11,228 12,202 1970., 70,920 19,349 623 3,536 4,504 15,040 3,687 11,621 12,561 1971., 71,216 18,572 603 3,639 4,457 15,352 3,802 11,903 12,887 1972. 73,711 19,090 622 3,831 4,517 15,975 3,943 12,392 13,340 1973. 76,896 20,068 644 4,015 4,644 16,674 4,091 13,021 13,739 1974. 78,413 20,046 694 3,957 4,696 17,017 4,208 13,617 14,177 SEASONALLY ADJUSTED 1974—Oct.. . 78,790 19,972 728 3,872 4,686 17,154 4.228 13,797 14,353 Nov.. 78,374 19,638 722 3,826 4,683 17,058 4,226 13,822 14,399 Dec... 77,723 19,190 686 3,770 4,659 16,935 4.229 13,833 14,421 1975—Jan.. .. 77,319 18,798 723 3,749 4,603 16,903 4,219 13,857 14,467 Feb.... 76,804 18,375 724 3,592 4,565 16,879 4,210 13,865 14,594 Mar.. . 76,468 18,226 729 3,467 4,506 16,851 4.207 13,864 14,618 Apr 76,462 18,155 732 3,441 4,508 16,847 4,209 13,878 14,692 May... 76,510 18,162 738 3,439 4,491 16,857 4.208 13,889 14,726 June... 76,343 18,100 741 3,392 4,469 16,877 4.202 13,871 14,691 July. .. 76,679 18,084 743 3,395 4,464 16,984 4.203 13,990 14,816 Aug.... 77,023 18,254 749 3.415 4,466 17,016 4,218 14,054 14,855 Sept.*. 77,275 18,410 749 3.416 4,466 17,042 4,236 14,126 14,830 Oct.®.. 77,492 18,518 770 3,387 4,474 17,032 4,247 14,174 14,890 NOT SEASONALLY ADJUSTED 1974—Oct.. 79,465 20,174 718 4,120 4,714 17,249 4,220 13,825 14,445 Nov.. 79,151 19,799 719 3,952 4,697 17,361 4,213 13,80S 14,602 Dec.. 78,462 19,209 681 3,695 4,659 17,608 4,208 13,764 14,638 1975—Jan.. .. 76,207 18,573 715 3,348 4,548 16,700 4.177 13,608 14,538 Feb.... 75,772 18,165 714 3,208 4.492 16,493 4,172 13,699 14,829 Mar.. . 75,778 18,037 719 3,197 4,470 16,530 4.178 13,753 14,894 Apr 76,177 18,000 726 3,310 4,472 16,691 4,192 13,878 14.908 May... 76,689 18,071 740 3,439 4,487 16,819 4,208 13,986 14,939 June... 77,183 18,255 756 3,555 4,523 16,971 4,248 14,079 14,796 July. .. 76,439 18,007 758 3,605 4,504 16,936 4,266 14,144 14,219 Aug 76,900 18,450 763 3,688 4.493 16,959 4,273 14,162 14,112 Sept.?. 77,582 18,691 755 3,651 4,502 17,081 4,240 14,126 14,546 Oct.®.. 78,130 18,449 759 3,604 4,501 17,125 4,239 14,202 14,986 NOTE.—Bureau of Labor Statistics; data include all full- and part- domestic servants, unpaid family workers, and members of Armed time employees who worked during, or received pay for, the pay period Forces are excluded. that includes the 12th of the month. Proprietors, self-employed persons, Beginning with 1973, series has been adjusted to Mar. 1974 benchmark. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • PRICES A 53 CONSUMER PRICES (1967 = 100) Health and recreation it A em ll s Total H ow o n m e e r - - F a o u n i d e l l e G a l n e a d c s - n F i a n i n u s g d h r s - - A up p a k p n e a d e r e p l T p t o r i a r o n t n a s - - M ic e a d l - s P o e n r a - l ship coal tricity opera- care care tion 51.3 48.3 76.0 48.5 38.8 30.6 54.1 36.9 44.1 38.4 53.7 57.2 40.5 81.4 44.8 44.2 37.0 41.2 53.9 50.7 59.1 58.8 48.0 79.6 61.5 47.8 42.1 55.1 88.7 88.0 90.2 91.7 86.3 89.2 98.6 93.8 89.6 89.6 85.1 79.1 90.1 94.5 94.4 94.9 96.9 92.7 94.6 99.4 95.3 93.7 95.9 93.4 89.5 95.2 97.2 99.1 97.2 98.2 96.3 97.0 99.6 97.0 96.1 97.2 96.1 93.4 97.1 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 104.2 103.6 104.2 102.4 105.7 103.1 100.9 104.4 105.4 103.2 105.0 106.1 104.2 109.8 108.9 110.8 105.7 116.0 105.6 102.8 109.0 111.5 107.2 110.3 113.4 109.3 116.3 114.9 118.9 110.1 128.5 110.1 107.3 113.4 116.1 112.7 116.2 120.6 113.2 121.3 118.4 124.3 115.2 133.7 117.5 114.7 118.1 119.8 118.6 122.2 128.4 116.8 125.3 123.5 129.2 119.2 140.1 118.5 120.5 121.0 122.3 119.9 126.1 132.5 119.8 133.1 141.4 135.0 124.3 146.7 136.0 126.4 124.9 126.8 123.8 130.2 137.7 125.2 147.7 161.7 150.6 130.2 163.2 214.6 145.8 140.5 136.2 137.7 140.3 150.5 137.3 151 .7 165.0 154.9 131.4 167.9 222.7 150.2 146.6 139.9 142.2 144.0 155.2 141.2 153.0 166.1 156.7 132.2 170.1 225.5 151.5 149.0 141 .1 142.9 145.2 156.3 143.0 154.3 167.8 158.3 132.8 171.7 229.2 154.0 151 .0 142.4 143.4 146.3 157.5 144.2 155.4 169.7 159.9 133.5 174.0 228.8 156.7 152.3 141.9 143.5 147.5 159.0 145.3 156.1 170.9 161 .2 134.0 175.6 228.9 160.2 153.2 139.4 143.2 148.9 161 .0 146.5 157.2 171.6 162.7 135.1 177.3 229.5 162.7 154.7 140.2 143.5 150.2 163.0 147.8 157.8 171.3 163.6 135.5 178.2 228.3 164.0 155.6 140.9 144.8 151.1 164.6 148.9 158.6 171 .2 164.7 135.9 179.4 229.0 166.3 156.8 141 .3 146.2 152.1 165.8 149.5 159.3 171 .8 165.3 136.4 180.1 230.2 167.3 157.4 141 .8 147.4 152.6 166.8 149.9 160.6 174.4 166.4 136.9 181 .4 230.6 169.4 158.1 141 .4 149.8 153.2 168.1 150.3 162.3 178.6 167.1 137.3 182.3 234.1 170.4 158.3 141.1 152.6 154.0 169.8 151.2 162.8 178.1 167.7 138.0 182.8 235.7 171.2 158.8 142.3 153.6 154.6 170.9 151.4 163.6 177.8 168.9 138.4 183.9 238.7 174.0 143.5 160. 1 155.4 155.4 172.2 152.1 NOTE.—Bureau of Labor Statistics index for city wage earners and clerical workers. WHOLESALE PRICES: SUMMARY (1967 = 100, except as noted) Industrial commodities All Prom c t o o ie m d s i - - p F u r a c o r t d m s - c f f e a o e s n o e s d d d e s d s Total t T e il e t e c x s . - , H e i t d c e . s, F e u t e c. l , C ic e h a t e c l m s . , - R b e u t e c r b . , - L b e u t e c m r . , - P e a t p c e . r, M e a t l e c s t , . - e c m M a q e h n e u r i a y d n n i - p t - - F t u e u t r r c n e . , i - N t e m m a r o l i a e l n n l i - s - c - T e p m t q r o i e a u o r n n n i t p a s t1 - - - n c M e e o l i l s u a - s - 94.9 97.2 89.5 95.3 99.5 90.8 96.1 101.8 103.1 95.3 98.1 92.4 92.0 99.0 97.2 93.0 96.6 98.7 95.5 96.4 99.8 94.3 95.5 99.0 95.9 95.9 96.2 96.4 93.9 96.9 97.5 95.9 99.8 105.9 101.2 98.5 100.1 103.4 97.8 99.4 97.8 100.2 98.8 98.8 96.8 98.0 98.4 97.7 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 102.5 102.5 102.2 102.5 103.7 103.2 98.9 99.8 103.4 113.3 101.1 102.6 103.2 102.8 103.7 102.2 106.5 109.1 107.3 106.0 106.0 108.9 100.9 99.9 105.3 125.3 104.0 108.5 106.5 104.9 107.7 100.8 105.2 110.4 111.0 112.0 110.0 107.2 110.1 105.9 102.2 108.6 113.7 108.2 116.7 111.4 107.5 113.3 104.5 109.9 113.9 112.9 114.3 114.0 108.6 114.0 114.2 104.2 109.2 127.0 110.1 119.0 115.5 109.9 122.4 110.3 112.8 119.1 125.0 120.8 117.9 113.6 131.3 118.6 104.2 109.3 144.3 113.4 123.5 117.9 111.4 126.1 113.8 114.6 134.7 176.3 148.1 125.9 123.8 143.1 134.3 110.0 112.4 177.2 122.1 132.8 121.7 115.2 130.2 115.1 119.7 160.1 187.7 170.9 153.8 139. 1 145. 1 208.3 146.8 136.2 183.6 151.7 171.9 139.4 127.9 153.2 125.5 133.1 170.2 187.5 183.5 164.8 140.5 145.2 228.5 168.5 147.5 169.4 166.0 186.9 150.0 135.5 162.2 134.2 137.1 171.9 187.8 189.7 165.8 139.8 144.5 227.4 172.9 148.5 165.8 166.9 186.7 152.7 136.9 163.4 135.1 140.7 171 .5 183.7 188.2 166.1 138.4 143.2 229.0 174.0 149.4 165.4 167.2 184.6 154.0 137.7 164.3 137.0 142.4 171.8 179.7 186.4 167.5 137.5 142.1 232.2 176.0 149.6 164.7 169.8 185.5 156.6 138.8 168.5 137.1 145.5 171 .3 174.6 182.6 168.4 136.5 141 .7 232.3 178.1 150.0 169.3 169.8 186.3 157.7 139.1 170.3 138.2 146.4 170.4 171.1 177.3 168.9 134.3 143.2 233.0 181.8 149.7 169.6 170.0 186.1 158.8 138.5 170.8 139.5 146.8 172.1 177.7 179.4 169.7 134.4 147.5 236.5 182.4 149.4 174.9 169.7 185.7 159.7 138.5 173.0 139.9 147.3 173.2 184.5 179.0 170.3 135.2 147.7 238.8 182.1 148.9 183.0 169.8 185.1 160.4 138.6 173.1 139.9 147.5 173.7 186.2 179.7 170.7 135.9 148.7 243.0 181 .2 148.6 181 .0 169.8 184.5 161 .0 139.0 173.3 140.1 147.5 175.7 193.7 184.6 171 .2 136.8 149.3 246.6 181 .4 150.1 179.6 170.0 183.4 161 .7 139.2 174.7 140.1 147.7 176.7 193.2 186.3 172.2 137.6 149.3 252.4 182.1 150.0 179.7 170.0 184.3 162.2 139.8 175.8 140.5 147.8 177.7 197.1 186.1 173.1 138.4 151.3 254.9 182.2 150.8 179.9 170.3 185.5 163. 1 140.1 176.1 141.1 148.2 178.9 197.3 186.2 174.7 141.3 152.4 256.5 182.3 151.5 179.1 170.9 187.2 164.1 141.1 177. 1 146.6 147.6 i Dec. 1968=100. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 54 NATIONAL PRODUCT AND INCOME • NOVEMBER 1975 GROSS NATIONAL PRODUCT (In billions of dollars) 1974 1975 IItteemm 11992299 1933 1941 1950 1970 1971 1972 1973 1974 III IV I 11 HIP Gross national product 103.1 55 6 124.5 284. 8 977.1 1,054.9 1,158.0 1,294.9 1,397.4 1,416.3 1,430.9 1,416.6 1,440.9 1,497.8 Final purchases 101.4 57.2 120.1 278. 0 972.6 1,04.8.6 1,H9.5 1,279.6 1,383.2 1,407.6 1.413. 1 1.435.8 1,471. 9 1,507.3 Personal consumption expenditures... . 77.2 45 8 80.6 191. 0 617.6 667.1 729. 0 805.2 876.7 901.3 895. 8 913.2 938. 6 970.0 Durable goods 9.2 3 5 9.6 30. 5 91.3 103.9 118. 4 130.3 127.5 136. 1 120.7 124.9 130.6 139.0 Nondurable goods 37.7 22 3 42.9 98. 1 263.8 278.4 299. 7 338.0 380.2 389.0 391. 7 398.8 410.1 423.8 Services 30.3 20.1 28. 1 62.4 262.6 284.8 310.9 336.9 369.0 376.2 383.5 389.5 397. 9 407.2 Gross private domestic investment 16.2 1. 4 17.9 54.1 136.3 153.7 179. 3 209.4 209.4 205.8 209.4 163.1 148.1 174.9 Fixed investment 14.5 3 .0 13.4 47.3 131.7 147.4 170. 194.0 195.2 197.1 191. 6 182.2 179. 1 184.4 Nonresidential 10.6 2 .4 9.5 27. 9 100.6 104.6 116. 136.8 149.2 150.9 151. ,2 146.9 142. 7 143.6 Structures 5.0 .9 2.9 9. 2 36.1 37.9 41. 1 47.0 52.0 51.0 53. 7 52.8 49. 1 49.0 Producers' durable equipment.. 5.6 I. .5 6.6 18. 7 64.4 66.6 75. 7 89.8 97. 1 99.9 97. 5 94.2 93. 6 94.6 Residential structures 4.0 .6 3.9 19. 4 31.2 42.8 54. 0 57.2 46.0 46.2 40.4 35.3 36. 4 40.8 Nonfarm 3.8 .5 3.7 18. 6 30.7 42.3 53. 4 56.7 45.2 45.4 39. 7 34.8 35. 6 39.9 Change in business inventories 1.7 ,6 4.5 6. 8 4.5 6.3 8. 5 15.4 14.2 8.7 17., 8 -19.2 -31. 0 -9.5 Nonfarm 1.8 -1, .4 4.0 6. 0 4.3 4.9 7. 8 11.4 11.9 6.6 17., 5 -17.8 -30. 6 -10.6 Net exports of goods and services 1.1 .4 1.3 1. 8 3.6 -.2 -6. 0 3.9 2.1 -3.1 1. 9 8.8 16.2 9.8 Exports 7.0 2.4 5.9 13. 8 62.9 65.4 72. 4 100.4 140.2 143.6 147., 5 142.2 136.. 0 140.2 Imports 5.9 2 .0 4.6 12., 0 59.3 65.6 78. 4 96.4 138.1 146.7 145.. 7 133.4 119., 8 130.4 Government purchases of goods and services 8.5 8 .0 24.8 37. .9 219.5 234.2 255. 7 276.4 309.2 312.3 323. .8 331.6 338. 1 343.1 Federal 1.3 2 .0 16.9 18 .4 96.2 97.6 104. ,9 106.6 116.9 117.2 124 .5 126.5 128, .4 129.9 National defense 13.8 14,. 1 74.6 71.2 14. 8 74.4 78.7 78.4 84, .0 84.7 84, .8 85 .6 Other 3.1 4,. 3 21.6 26.5 30.1 32.2 38.2 38.8 40 .6 41.8 43, .6 44.3 State local 7.2 6 .0 7.9 19,. 5 123.3 136.6 150.8 169.8 192.3 195. 1 199,. 3 205. 1 209, .7 213.2 Gross national product in constant (1958) dollars 203.6 141 .5 263.7 355 .3 722.5 746.3 792, .5 839.2 821.2 823.1 804 .0 780.0 783 .6 804.6 NOTE.—Dept. of Commerce estimates. Quarterly data are seasonally see the Survey of Current Business (generally the July issue) and the adjusted totals at annual rates. For back data and explanation of series, Aug. 1966 Supplement to the Survey. NATIONAL INCOME (In billions of dollars) 1974 1975 IItteemm 11992299 11993333 11994411 11995500 11997700 11997711 11997722 11997733 11997744 III IV I II Illf National income 86.8 40.3 104.2 241.1 800.5 857.7 946.5 1,065.6 1,142.5 1,155.5 1,165.4 1,150.7 1,175.4 Compensation of employees 51.1 29.5 64.8 154.6 603.9 643.1 707.1 786.0 855.8 868.2 877.7 875.6 885.4 906.4 Wages and salaries 50.4 29.0 62.1 146.8 542.0 573.6 626.8 691.6 750.7 761.5 769.2 765.1 773.0 791.3 Private 45.5 23.9 51.9 124.4 426.9 449.5 491.4 545. 1 592.4 602.5 605.1 597.4 601.9 617.3 Military .3 .3 1.9 5.0 19.6 19.4 20.5 20.6 21.2 20.8 22.0 22.0 21.9 22.0 Government civilian 4.6 4.9 8.3 17.4 95.5 104.7 114.8 126.0 137.1 138.2 142.1 145.7 149.2 152.0 Supplements to wages and salaries.. . .7 .5 2.7 7.8 61.9 69.5 80.3 94.4 105.1 106.7 108.6 110.5 112.4 115.2 Employer contributions for social insurance . 1 . 1 2.0 4.0 29.7 33.1 38.6 48.4 53.6 54.5 54.6 55.2 55.7 57.0 Other labor income .6 .4 .7 3.8 32.2 36.4 41.7 46.0 51.4 52.3 54.0 55.3 56.7 58.2 Proprietors' income 15.1 5.9 17.5 37.5 66.9 69.2 75.9 96.1 93.0 92.1 91.6 84.9 86.1 94.6 Business and professional 9.0 3.3 11.1 24.0 50.0 52.0 54.9 57:6 61.2 62.3 62.5 62.7 63.4 64.7 Farm 6.2 2.6 6.4 13.5 16.9 17.2 21.0 38.5 31.8 29.8 29.1 22.2 22.7 29.9 Rental income of persons 5.4 2.0 3.5 9.4 23.9 25.2 25.9 26.1 26.5 26.6 26.8 27.0 27.1 27.4 Corporate profits and inventory valuation adjustment 10.5 -1.2 15.2 37.7 69.2 78.7 92.2 105.1 105.6 105.8 103.4 94.3 104.9 Profits before tax 10.0 1.0 17.7 42.6 74.0 83.6 99.2 122.7 140.7 157.0 131.5 101.2 113.3 Profits tax liability 1.4 .5 7.6 17.8 34.8 37.5 41.5 49.8 55.7 62.7 52.0 39.0 43.0 Profits after tax 8.6 .4 10.1 24.9 39.3 46.1 57.7 72.9 85.0 94.3 79.5 62.3 70.3 Dividends 5.8 2.0 4.4 8.8 24.7 25.0 27.3 29.6 32.7 33.2 33.3 33.8 34.0 3344..55 Undistributed profits 2.8 -1.6 5.7 16.0 14.6 21. 1 30.3 43.3 52.4 61.1 46.2 28.5 36.3 Inventory valuation adjustment .5 -2.1 -2.5 -5.0 -4.8 -4.9 -7.0 -17.6 -35.1 -51.2 -28. 1 -7.0 -8.4 -11.5 Net interest 4.7 4.1 3.2 2.0 36.5 41.6 45.6 52.3 61.6 62.8 65.9 68.9 71.9 75.9 NOTE.—Dept. of Commerce estimates. Quarterly data are seasonally adjusted totals at annual rates. See also NOTE to table above. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • NATIONAL PRODUCT AND INCOME A 55 RELATION OF GROSS NATIONAL PRODUCT, NATIONAL INCOME, AND PERSONAL INCOME AND SAVING (In billions of dollars) 1974 1975 IItteemm 11992299 11993333 11994411 11995500 11997700 11997711 11997722 11997733 11997744 III IV I II IIIP Gross national product 103.1 55.6 124.5 284.8 977.1 1 054.9 1,158.0 1,294.9 1,397.4 1,416.3 1,430.9 1,416.6 1,440.9 1,497.8 Less: Capital consumption allowances 7.9 7.0 8.2 18.3 87.3 93.7 102.9 110.8 119.5 120.7 122.9 125.2 127.4 130.0 Indirect business tax and nontax liability 7.0 7.1 11.3 23.3 93.5 102.7 110.0 119.2 126.9 129.5 129.8 132.2 135.4 139.8 Business transfer payments .6 .7 .5 .8 4.0 4.3 4.6 4.9 5.2 5.3 5.3 5.4 5.5 5.5 Statistical discrepancy .7 .6 .4 1.5 --66..44 --22..33 -3.8 --55..00 .4 33..00 44..88 1.6 --44..44 Plus: Subsidies less current surplus of government enterprises -. 1 . 1 .2 1.7 1.1 2.3 .6 -2.9 -2.4 -2.7 -1.6 -1.6 -1.1 Equals: National income 86.8 40.3 104.2 241.1 800.5 857.7 946.5 1,065.6 1,142.5 1,155.5 1,165.4 1,150.7 1,175.4 Less: Corporate profits and inventory valuation adjustment 10.5 -1.2 15.2 37.7 69.2 78.7 92.2 105.1 105.6 105.8 103.4 94.3 110044..99 Contributions for social insurance .2 .3 2.8 6.9 57.7 63.8 73.0 91.2 101.5 103.0 103.2 104.6 105.4 107.6 Excess of wage accruals over .0 .6 .0 1 -.5 -1.5 .0 .0 ..00 .0 Plus: Government transfer payments. . .9 1.5 2.6 14.3 75.1 89.0 98.6 113.0 134.6 138.7 145.8 158.7 170.9 172.5 Net interest paid by government and consumers 2.5 1.6 2.2 77..22 31.0 31.2 33.0 38.3 42.3 42.7 43.6 43.7 4455..00 45.7 Dividends 5.8 2.0 4.4 8.8 24.7 25.0 27.3 29.6 32.7 33.2 33.3 33.8 34.0 34.5 Business transfer payments .6 .7 .5 .8 4.0 4.3 4.6 4.9 5.2 5.3 5.3 5.4 5.5 5.5 Equals: Personal income 85.9 47.0 96.0 227.6 808.3 864.0 944.9 1,055.0 1,150.5 1,168.2 1,186.9 1,193.4 1,220.5 1,255.0 Less: Personal tax and nontax payments 2.6 1.5 3.3 20.7 116.6 117.6 142.4 151.3 170.8 175.1 178.1 178.0 142.0 175.9 Equals: Disposable personal income. . . 83.3 45.5 92.7 206.9 691.7 746.4 802.5 903.7 979.7 993.1 1,008.8 1,015.5 1,078.5 1,079.1 Less: Personal outlays 79.1 46.5 81.7 193.9 635.5 685.9 749.9 829.4 902.7 927.6 922.3 939.5 964.7 996.3 Personal consumption expenditures 77.2 45.8 80.6 191.0 617.6 666677..11 729.0 805.2 876.7 901.3 895.8 913.2 993388..66 970.0 Consumer interest payments. . 1.5 .5 .9 2.4 16.8 17.7 19.8 22.9 25.0 25.3 25.5 25.4 25.2 25.4 Personal transfer payments to foreigners .3 .2 ..22 .5 11..00 1.1 1.1 1.3 11..00 .9 .9 ..99 ..99 .8 Equals: Personal saving 4.2 -.9 11.0 13.1 56.2 60.5 52.6 74.4 77.0 65.5 86.5 75.9 113.8 82.9 Disposable personal income in constant (1958) dollars 150.6 112.2 190.3 224499..66 534.8 555555..44 558800..55 619.6 660022..88 602.9 594.8 591.0 620.2 610.6 NOTE.—Dept. of Commerce estimates. Quarterly data are seasonally adjusted totals at annual rates. See also NOTE to table at top of opposite page. PERSONAL INCOME (In billions of dollars) 1974 Sept. Oct. Nov. Dec, Jan. Feb. Mar. Apr. Ma y June July Aug. Sept.*7 Total personal income 1,055.01,150.5 ,178.0 ,185.0 ,184.5 ,191.0 ,191.1 1,193.4 ,195.7 ,203.1 1,214. 1,244 1238 1,255.9 Wage and salary disbursements. 691.7 751.2 767.7 773.0 767.8 766.6 765.7 763.6 766.0 768.0 772. 778. 782 792.3 Commodity-producing industries 251.9 270.9 278.3 279.5 272.3 269.3 266.4 260.7 260.5 261.2 262. 264. 266 Manufacturing only 196.6 211.3 2H.8 219.4 214.2 209.7 206.4 202.9 203.1 203.8 204. 206 208 Distributive industries. ... 165.1 178.9 183.1 183.8 183.9 183.8 183.2 184.0 183.8 184.3 186. 187 187 Service industries 128.2 142.6 146.4 146.9 147.4 148.3 149.8 151.2 152.6 152.4 153. 154. 155 Government 146.6 158.8 159.9 162.8 164.2 165.2 166.2 167.6 169.2 170.3 171. 171 173 Other labor income 46.0 51.4 52.9 53.5 54.0 54.5 54.9 55.3 55.7 56.2 57.2 57.7 Proprietors'income 96.1 93.0 93.2 91.7 91.6 91.5 88.7 85.0 80.9 83.6 86, 91.6 Business and professional... 57.6 61.2 62.5 62.5 62.5 62.5 62.7 62. 62.5 63.0 63, 63. 64.1 Farm 38.5 31 30.7 29.0 26.0 22.2 18.4 20.6 23, 24 27.5 29.2 29.1 Rental income 26.1 26.5 26.6 26.7 26.8 26.9 27.0 27.0 27.0 27.1 27, 27. 27.2 Dividends 29.6 32.7 33.4 33.5 33.6 32.7 33.9 33.8 33.7 33.9 34. 34. 34.2 Personal interest income 90.6 103.8 106.9 108.0 109.5 111.1 111.9 112.5 113.3 114.8 116 119. 119.8 Transfer payments 117.8 139.8 146.0 147.6 149.8 156.1 158.6 165.5 168.3 168.9 169. 190. 176.3 Less: Personal contributions for social insurance.... 42. 47.9 48.6 48.9 48.5 48.4 49.5 49.2 49.3 49.4 49.7 50.0 50.2 Nonagricultural income 1,008. 01,, 10 9.0 1,137.4 1,145.7 1,145.2 1,151.4 1,154.3 1,160.1 1,166.2 ,171.1 1,179.7 1,207.9 1199.5 1,214.0 Agricultural income 47.0 41.5 40.6 39.3 39.3 39.5 36.8 33.3 29.6 32.1 34.6 36.2 39.4 42.0 NOTE.—Dept. of Commerce estimates. Monthly data are seasonally adjusted totals at annual rates. See also NOTE to table at top of opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 56 FLOW OF FUNDS • NOVEMBER 1975 SUMMARY OF FUNDS RAISED IN U.S. CREDIT MARKETS (Seasonally adjusted annual rates; in billions of dollars) 1974 1975 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 1966 1967 1968 1969 1970 1971 1972 1973 1974 HI H2 HI Credit market funds raised by nonfinancial sectors 1 Total funds raised by nonfinancial sectors 67.9 82.4 96. 0 91. 8 98.2 147.4 169.4 187.4 180.1 187. 3 172.4 188.4 1 2 Excluding equities 66.9 80.0 96.0 87.9 92.4 135.9 158.9 180.1 176.2 181. 9 170.0 179.6 2 3 U.S. Government 3.6 13.0 13. 4 -3. 7 12.8 25.5 17.3 9.7 12.0 5. 1 18.9 81 .4 3 4 Public debt securities 2.3 8.9 10.4 -1 . 3 12.9 26.0 13.9 7.7 12.0 3. 9 20.2 82.6 4 5 Agency issues and mortgages 1 .3 4.1 3. 1 -2. 4 -.1 -.5 3.4 2.0 * 1 .2 -1 .3 -1 .2 5 6 All other nonfinancial sectors 64.3 69.4 82.6 95. 5 85.4 121.9 152.1 177.7 168.1 182. 2 153.4 107.0 6 7 Corporate equities 1 .0 2.4 * 3. ,9 5.8 11 .5 10.5 7.2 3.8 5. 4 2.3 8.8 7 8 Debt instruments 63.3 67.0 82. ,6 91. .6 79.7 110.4 141.6 170.4 164.2 176. ,5 151.1 98.2 8 Private domestic 9 Nonfinancial sectors 62.7 65.4 79. .7 91. 8 82.7 117.3 147.8 170.1 152.7 162. .2 142.6 100.1 9 10 Corporate equities 1.3 2.4 —, ,2 3. ,4 5.7 11 .4 10.9 7.4 4.1 5. .6 2.6 8.7 10 11 Debt instruments 61.5 63.0 79.. 9 88. .4 77.0 105.8 136.9 162.7 148.6 156.6 140.0 91.4 11 12 Debt capital instruments 38.2 44.5 49. ,5 49, .6 56.7 83.2 93.8 96.1 92.9 99, .6 86.2 106.9 12 13 State and local obligations 5.6 7.8 9. ,5 9. .9 11 .2 17.6 14.4 13.7 17.4 18.. 3 16.5 17.4 13 14 Corporate bonds. 10.2 14.7 12. .9 12,. 0 19.8 18.8 12.2 9.2 19.7 18, ,1 21 .3 38.2 14 15 Home mortgages 11.7 11.5 15, .1 15. .7 12.8 26.1 39.6 43.3 31.7 35. 27.6 34.3 15 16 Multifamily residential mortgages 3.1 3.6 3, .4 4. .7 5.8 8.8 10.3 8.4 7.8 7.. 3 8.2 6.2 16 17 Commercial mortgages 5.7 4.7 6, ,4 5. .3 5.3 10.0 14.8 17.0 11.5 15. .7 7.2 5.7 17 18 Farm mortgages 1.8 2.3 2, .2 1.. 9 1.8 2.0 2.6 4.4 4.9 4. .5 5.4 5.1 18 19 Other debt instruments 23.3 18.5 30.. 4 38 .8 20.3 22.6 43.0 66.6 55.6 57, .0 53.8 -15.4 19 20 Consumer credit 6.4 4.5 10.. 0 10, .4 6.0 11 .2 19.2 22.9 9.6 12,. 7 6.1 -.6 20 21 Bank loans n.e.c 10.9 9.8 13.. 6 15,. 5 6.7 7.8 18.9 35.8 27.3 32, .6 21 .9 -16.1 21 22 Open-market paper 1 .1 1 .7 1 .8. 3,. 0 3.0 -1 .2 -.5 -.4 6.6 5, .1 8.2 -1 .5 22 23 Other 5.0 2.6 5, .0 9, .9 4.6 4.8 5.5 8.3 12.1 6 .6 17.5 2.8 23 24 By borrowing sector: 62.7 65.4 79, .7 91 .8 82.7 117.3 147.8 170.1 152.7 162 .2 142.6 100.1 24 25 State and local governments 6.3 7.9 9 .8 10.7 11.3 17.8 14.2 12.3 16.6 16 .4 16.7 14.0 25 26 Households 22.7 19.3 30.0 31 .7 23.4 39.8 63.1 72.8 44.0 47 .5 40.0 37.5 26 27 Farm 3.1 3.6 2, .8 3,. 2 3.2 4.1 4.9 8.6 7.8 7 .7 7.9 6.9 27 28 Nonfarm noncorporate 5.4 5.0 5, ,6 7, .4 5.3 8.7 10.4 9.3 7.2 7 .1 7.3 3.2 28 29 Corporate 25.3 29.6 31 .,6 38 .9 39.5 46.8 55.3 67.2 77.1 83 .5 70.7 38.6 29 30 Foreign 1.5 4.0 2,. 8 3,. 7 2.7 4.6 4.3 7.5 15.4 20.0 10.9 6.9 30 31 Corporate equities -.3 .1 .2 .5 .1 * -.4 -.2 -.3 — .2 -.3 .1 31 32 Debt instruments 1.8 4.0 2 .7 3 .2 2.7 4.6 4.7 7.7 15.7 20.2 11.1 6.8 32 33 Bonds .7 1 .2 1 .1 1 .0 .9 .9 1 .0 1 .0 2.2 2 .1 2.3 5.0 33 34 Bank loans n.e.c - .2 -.3 — .5 — .2 -.3 1 .6 2.9 2.8 4.7 9 .6 -.2 -.5 34 35 Open-market paper -.1 .5 — .2 .3 .8 .3 -1 .0 2.2 7.1 7 .0 7.1 -.4 35 36 U.S. Government loans 1.3 2.6 2 .2 2 .1 1.3 1 .8 1 .8 1 .7 1 .7 1 .5 1 .8 2.7 36 37 Memo: U.S. Govt, cash balance -.4 1 .2 -1 .1 .4 2.8 3.2 - .3 -1 .7 -4.6 -2.0 -7.1 3.1 37 Totals net of changes in U.S. Govt, cash balances— 38 Total funds raised 68.3 81 .3 97 .1 91 .4 95.5 144.2 169.7 189.0 184.7 189 .3 179.5 185.3 38 39 By U.S. Government 4.0 11 .8 14 .6 -4 .1 10.0 22.3 17.6 11 .4 16.6 7 .1 26.0 78.2 39 Credit market funds raised by financial sectors ! Total funds raised by financial sectors 11.7 2.0 18., 3 33.7 12.6 16.5 28.9 52.0 38. 0 40.8 35.2 4.2 1 2 Sponsored credit agencies 4. .8 -.6 3. ,5 8.8 • 8.2 3.8 6.2 19. ,6 22. ,1 16.8 27.4 8.0 2 3 U.S. Government securities 5. .1 -.6 3. ,2 9.1 8.2 3.8 6.2 19. ,6 21 .,4 16.8 26.0 6.9 3 4 Loans from U.S. Government ,2 -.1 ,2 -.3 ,7 1 .4 1 .1 4 5 Private financial sectors 6. ,9 2.6 14!. 9 24.9 4.3 12.7 22.8 32, ,4 15!. 9 24.1 7.8 -3.8 5 6 Corporate equities 3. ,7 3.0 6, .4 6.1 4.6 3.3 2.4 ,8 1 ..7 .5 3.0 3.8 6 7 Debt instruments 3. ,2 -.4 5, .5 18.8 3 9.3 20.3 31'.. 6 14. .2 23.6 4.8 -7.6 7 8 Corporate bonds ,9 1.3 1 .1, 1 .5 3.1 5.1 7.0 2.3 1 .4, 2.0 .9 2.3 8 9 Mortgages —,, 9 1 .0 .4 .2 .7 2.1 1 .7 -1 , .2 -1 , .3 .1 -2.7 1 .7 9 10 Bank loans n.e.c . -1 . .0 -2.0 2. .5 2.3 -.5 3.0 6.8 13, ,5 7, .5 8.9 6.2 -8.8 10 11 Open-market paper and RP's 3,. 3 1 .9 3,. 6 10.7 -5.0 1 .8 4.9 9, .8 — .1 5.8 -6.0 5.3 11 12 Loans from FHLB's .9 -2.5 .9 4.0 1.3 -2.7 * 7, .2 6 .7 6.8 6.5 -8.1 12 13 Total funds raised, by sector 11.. 7 2.0 18.3 33.7 12.6 16.5 28.9 52, .0 38 .0 40.8 35.2 4.2 13 14 Sponsored credit agencies 4, .8 -.6 3,. 5 8.8 8.2 3.8 6.2 19,. 6 22 .1 16.8 27.4 8.0 14 15 Private financial sectors 6 .9 2.6 14 .9 24.9 4.3 12.7 22.8 32, .4 15 .9 24.1 7.8 -3.8 15 16 Commercial banks.. — .1 .1 1 .2 1 .4 -3.1 2.5 4.0 4, .5 -1 .9 2.6 -6.4 5.8 16 17 Bank affiliates 4.2 -1 .9 -.4 .7 2, .2 2.4 4.1 .7 .9 17 18 Foreign banking agencies .1 * .1 .2 .1 1 .6 .8 5, .1 2 .9 2.7 3.1 -.9 18 19 Savings and loan associations .1 -1 .7 1 .1 4.1 1.8 -.1 2.0 6 .0 6 .3 8.6 4.0 -8.0 19 20 Other insurance companies .1 .1 .2 .5 .4 .6 .5 .5 .4 .4 .3 .3 20 21 Finance companies 3 .1 1 .2 5.7 8.3 1 .6 4.2 9.3 9 .4 3 .9 3.6 4.2 -3.4 21 22 REITS .7 1 .3 2.7 3.0 6.1 6 .3 1 .0 2.8 -.9 -1 .3 22 23 Open-end investment companies 3.7 3.0 5 .8 4.8 2.6 1 .1 -.7 -1 .6 1 .0 -.8 2.8 2.9 23 Total credit market funds raised, all sectors, by type ! Total funds raised 79.6 84.4 114.3 125.5 110.8 163.9 198. ,3 239, .4 218.1 228.1 207.6 192.6 1 2 Investment company shares 3.7 3.0 5.8 4.8 2.6 1.1 — .7 -1 .6 1 .0 -.8 2.8 2.9 2 3 Other corporate equities 1.1 2.5 .6 5.2 7.7 13.6 13. ,6 9, .6 4.6 6.7 2.5 9.7 3 4 Debt instruments 74.9 79.0 107.9 115.5 100.4 149.1 185. .4 231 .3 212.5 222.2 202.3 179.9 4 5 U.S. Government securities 8.8 12.5 16.7 5.5 21 .1 29.4 23. ,6 29 .4 33.5 21.9 45.1 88.2 5 6 State and local obligations 5.6 7.8 9.5 9.9 11 .2 17.6 14, .4 13 .7 17.4 18.3 16.5 17.4 6 7 Corporate and foreign bonds 1 1 .8 17.2 15.0 14.5 23.8 24.8 20. .2 12,. 5 23.3 22.2 24.5 45.5 7 8 Mortgages 21 .3 23.0 27.4 27.8 26.4 48.9 68, .8 71 .9 54.5 63.4 45.6 52.9 8 9 Consumer credit 6.4 4.5 10.0 10.4 6.0 11 .2 19, .2 22 .9 9.6 12.7 6.1 -.6 9 10 Bank loans n.e.c 9.7 7.5 15.7 17.6 5.8 12.4 28. ,5 52 .1 39.5 51 .1 27.9 -25.4 10 11 Open-market paper and RP's 4.4 4.0 5.2 14.1 -1 .2 .9 3,. 3 11 .6 13.6 17.8 9.4 3.3 11 12 Other loans 6.9 2.5 8.3 15.8 7.3 4.0 7, .4 17 .2 21 .1 14.9 27.2 -1.5 12 NOTE.—Full statements for sectors and transaction types quarterly, and Flow of Funds Section, Division of Research and Statistics, Board of Digitized for FRASaEnRnu ally for flows and for amounts outstanding, may be obtained from Governors of the Federal Reserve System, Washington, D.C. 20551. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • FLOW OF FUNDS A 57 DIRECT AND INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS (Seasonally adjusted annual rates; in billions of dollars) 1974 1975 Transaction category, or sector 1966 1967 1968 1969 1970 1971 1972 1973 1974 HI H2 HI 1 Total funds advanced in credit markets to nonfinancial sectors 66.9 80.0 95.9 88.0 92.5 135.9 158.9 180.1 176.2 118811..99 117700..00 117799..66 1 By public agencies and foreign 2 11.9 11.3 12.2 15.7 28.1 41.7 18.3 33.2 49.2 39.5 58.9 36.1 2 3 U.S. Government securities 3.4 6.8 3.4 .7 15.9 33.8 8.4 11.0 8.6 6.9 10.4 27.6 3 4 Residential mortgages 2.8 2.1 2.8 4.6 5.7 5.7 5.2 7.6 13.8 11.7 15.9 16.8 4 5 FHLB advances to S&L's .9 -2.5 .9 4.0 1.3 -2.7 * 7.2 6.7 6.8 6.5 -8.1 5 6 Other loans and securities 4.8 4.9 5.1 6.3 5.2 4.9 4.6 7.5 20.1 14.1 26.1 -.3 6 By agency— 7 U.S. Government 4.9 4.6 4.9 2.9 2.8 3.2 2.6 3.0 7.4 2.4 12.4 12.3 7 8 Sponsored credit agencies 5.1 -.1 3.2 8.9 10.0 i 3.2 7.0 20.3 24.1 20.5 27.6 10.1 8 9 Monetary authorities 3.5 4.8 3.7 4.2 5.0 i 8.9 .3 9.2 6.2 6.1 6.2 6.9 9 10 Foreign -1.6 2.0 .3 -.3 10.3 26.4 8.4 .7 11.6 10.5 12.6 6.8 10 11 Agency borrowing not included in line 1 4.8 -.6 3.5 8.8 8.2 3.8 6.2 19.6 22.1 16.8 27.4 8.0 11 Private domestic funds advanced 12 Total net advances 59J 68.1 87.2 81.1 72.6 98.1 146.7 166.5 149.1 159.2 138.5 151.5 12 13 U.S. Government securities 5.4 5.7 13.3 4.8 5.2 -4.4 15.2 18.4 24.9 15.0 34.7 60.6 13 14 State and local obligations 5.6 7.8 9.5 9.9 11.2 17.6 14.4 13.7 17.4 18.3 16.5 17.4 14 15 Corporate and foreign bonds 10.3 16.0 13.8 12.5 20.0 ' 19.5 13.2 10.1 20.6 19.2 21.9 43.1 15 16 Residential mortgages 12.0 13.0 15.5 15.7 12.8 29.1 44.6 44.1 25.6 31.4 19.8 23.6 16 17 Other mortgages and loans 27.4 23.1 35.9 42.2 24.6 33.7 59.5 87.4 67.4 82.1 52.2 -1.3 17 18 Less: FHLB advances .9 -2.5 .9 4.0 1.3 -2.7 * 7.2 6.7 6.8 6.5 -8.1 18 Private financial intermediation 19 Credit market funds advanced by private financial 45.4 63.5 75.3 55.3 74.9 110.7 153.4 158.8 131.5 155.7 106.9 115.0 19 20 17.5 35.9 38.7 18.2 35.1 50.6 70.5 86.6 64.6 87.5 41.3 17.4 20 21 Savings institutions 7.9 15.0 15.6 14.5 16.9 41.4 49.3 35.1 26.9 35.4 18.3 61.6 21 22 Insurance and pension funds 15.5 12.9 14.0 12.7 17.3 13.3 17.7 22.1 34.3 29.1 39.4 34.8 22 23 Other finance 4.5 -.3 7.0 9.9 5.7 5.3 15.8 15.0 5.7 3.7 7.9 1.1 23 24 Sources of funds 45.4 63.5 75.3 55.3 74.9 110.7 153.4 158.8 131.5 155.7 106.9 115.0 24 25 Private domestic deposits 22.5 50.0 45.9 2.6 63.2 90.3 97.5 84.9 72.5 93.7 51.1 98.6 25 26 Credit market borrowing 3.2 -.4 8.5 18.8 -.3 9.3 20.3 31.6 14.2 23.6 4.8 -7.6 26 27 Other sources 19.8 13.9 21.0 34.0 12.0 11.0 35.5 42.4 44.8 38.4 50.9 24.0 27 28 Foreign funds 3.7 2.3 2.6 9.3 -8.5 -3.2 5.2 6.5 13.6 10.7 16.4 -5.4 28 29 Treasury balances -.5 .2 -.2 * 2.9 2.2 .7 -1.0 -5.1 -2.1 -8.1 -1.9 29 30 Insurance and pension reserves 13.6 12.0 11.4 10.8 13.1 9.1 13.1 16.7 27.9 22.7 33.2 26.5 30 31 Other, net 3.0 -.6 7.2 13.8 4.4 2.9 16.5 20.2 8.4 7.1 9.4 4.7 31 Private domestic nonfinancial investors 32 Direct lending in credit markets 17.6 4.2 20.4 44.5 -2.6 -3.2 13.7 39.3 3311..88 27.0 36.4 28.9 32 33 U.S. Government securities 8.4 -1.4 8.1 17.0 -9.0 -14.0 1.6 18.8 18.1 13.7 22.6 -5.0 33 34 State and local obligations 2.6 -2.5 -.2 8.7 -1.2 .6 2.1 4.4 10.8 8.3 13.3 13.5 34 35 Corporate and foreign bonds 2.0 4.6 4.7 6.6 10.7 9.3 5.2 1.1 -1.7 -1.4 -1.9 14.9 35 36 Commercial paper 2.3 1.9 5.8 10.2 -4.4 -.6 4.0 11.3 1.6 4.3 -1.0 2.7 36 37 Other 2.3 1.7 2.1 2.0 1.4 1.5 .8 3.8 2.9 2.2 3.5 2.8 37 38 Deposits and currency 24.4 52.1 48.3 5.4 66.6 93.7 101.9 88.8 78.8 102.3 55.2 105.9 38 39 Time and savings accounts 20.3 39.3 33.9 -2.3 56.1 81.0 85.2 76.3 71.9 89.0 54.8 87.7 39 40 Large negotiable CD's -.2 4.3 3.5 -13.7 15.0 7.7 8.7 18.5 23.6 30.0 17.2 -22.0 40 41 Other at commercial banks 13.3 18.3 17.5 3.4 24.2 32.9 30.6 29.5 26.6 32.4 20.7 39.3 41 42 7.3 16.7 12.9 8.0 16.9 40.4 45.9 28.2 21.8 26.6 16.9 70.4 42 43 Money 4.1 12.8 14.5 7.7 10.5 12.7 16.7 12.6 6.8 13.3 .4 18.1 43 44 2.1 10.6 12.1 4.8 7.1 9.3 12.3 8.6 .5 4.8 -3.7 10.9 44 45 2.0 2.1 2.4 2.8 3.5 3.4 4.4 3.9 6.3 8.5 4.1 7.3 45 46 Total of credit market instr., deposits, and currency. 42.0 56.3 68.7 49.9 64.1 90.5 115.7 128.1 110.5 129.3 91.6 134.8 46 47 Public support rate (in per cent) 17.9 14.1 12.7 17.8 30.4 30.7 11.5 18.4 27.9 21.7 34.6 20.1 47 48 Private financial intermediation (in per cent) 75.9 93.2 86.4 68.3 103.1 112.8 104.5 95.4 88.2 97.8 77.2 75.9 48 49 Total foreign funds 2.1 4.3 2.9 9.1 1.8 23.2 13.6 7.2 25.1 21.2 29.0 1.4 49 Corporate equities not included above 1 4.8 5.5 6.4 10.0 10.4 14.8 12.9 8.0 5.6 5.9 5.3 12.7 1 2 3.7 3.0 5.8 4.8 2.6 1.1 -.7 -1.6 1.0 -.8 2.8 2.9 2 3 1.1 2.5 .6 5.2 7.7 13.6 13.6 9.6 4.6 6.7 2.5 9.7 3 4 Acquisitions by financial institutions 6.0 9.1 10.8 12.2 11.4 19.3 16.0 13.4 6.1 8.5 3.6 11.1 4 5 -1.2 -3.6 -4.4 -2.2 -1.0 -4.5 -3.1 -5.4 -.5 -2.7 1.7 1.6 5 Notes 29. Demand deposits at commercial banks. Line 30. Excludes net investment of these reserves in corporate equities. 1. Line 2 of p. A-56. 31. Mainly retained earnings and net miscellaneous liabilities. 2. Sum of lines 3-6 or 7-10. 32. Line 12 less line 19 plus line 26. 6. Includes farm and commercial mortgages. 33-37. Lines 13-17 less amounts acquired by private finance. Line 37 11. Credit market funds raised by Federally sponsored credit agencies. includes mortgages. Included below in lines 13 and 33. Includes all GNMA-guaranteed 39+44. See line 25. security issues backed by mortgage pools. 45. Mainly an offset to line 9. 12. Line 1 less line 2 plus line 11. Also line 19 less line 26 plus line 32. 46. Lines 32 plus 38 or line 12 less line 27 plus line 45. Also sum of lines 27, 32, 39, and 44. 47. Line 2/line 1. 17. Includes farm and commercial mortgages. 48. Line 19/line 12. 25. Lines 39 + 44. 49. Lines 10 plus 28. 26. Excludes equity issues and investment company shares. Includes line 18. Corporate equities 28. Foreign deposits at commercial banks, bank borrowings from foreign Line 1 and 3. Includes issues by financial institutions. branches, and liabilities of foreign banking agencies to foreign affiliates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 58 U.S. BALANCE OF PAYMENTS • NOVEMBER 1975 1. U.S. BALANCE OF PAYMENTS SUMMARY (In millions of dollars. Quarterly figures are seasonally adjusted unless shown in italics.) 1974 1975 Credits (+), debits (-) 1972 1973 1974 IV Merchandise trade balance 1. -6,409 955 -5,277 -1,459 -2,315 -1,380 1 ,830 Exports 49,388 71,379 98,309 24,21~ 25,034 26,593 27,1"" Imports -55,797 -70,424 -103,568 -25,677 -27,349 -27,973 -25,358 Military transactions, net -3,621 -2,317 -2,158 -646 -513 -498 -349 Travel and transportation, net. -3,024 -2,862 -2,692 -111 -721 -741 -572 Investment income, net 2 4,321 5,179 10,121 1,964 2,354 2,559 1,176 U.S. direct investments abroad 2 6,416 8,841 17,679 4,399 4,700 4,080 2,156 Other U.S. investments abroad 3,746 5,157 8,389 2,048 2,354 2,358 2,148 Foreign investments in the United States - -5,841 -8,819 -15,946 -4,483 -4,700 -3,879 -3,128 Other services, net 2 2,803 3,222 3,830 936 960 1,049 1,093 Balance on goods and services : -5,930 4,177 3,825 78 -235 989 3,178 Not seasonally adjusted... 73 -2,871 2,348 4,230 Remittances, pensions, and other transfers. -1,606 -1,903 -1,721 -457 -439 -448 Balance on goods, services, and remittances. -7,537 2,274 2,104 -379 -692 Not seasonally adjusted -394 -3,340 1,950540 2,730 U.S. Government grants (excluding military) -2,173 -1,938 4-5,461 -1,408 3,812 Balance on current account... -9,710 335 4-3,357 -1.787 -1,500 -99 -727 Not seasonally adjusted.. — 7,6 -4,104 1,289 32,,007053 U.S. Government capital flows excluding nonscheduled repayments, net 5 -1,706 -2,933 4408 -195 -985 Nonscheduled repayments of U.S. Government assets 137 289 1 U.S. Government nonliquid liabilities to other than foreign official reserve agencies 234 1,154 710 211 278 125 541 Long-term private capital flows, net -69 177 -8,447 -999 -2,157 -5,554 -2,202 F U o .S re . i d g i n r e d c i t r e in ct v e in st v m es e t n m ts e n a t b s ro in a d t he United States -3,5 3 3 8 0 0 -4 2 , , 9 6 6 5 8 6 -7 2 , , 4 2 5 2 5 4 -1 1 , , 5 7 7 0 2 0 -1,8 - 2 1 8 -3 - , 6 3 5 1 3 0 -1,0 3 4 4 1 0 Foreign securities -618 -759 -1,990 -313 -304 -726 -2,021 U.S. securities other than Treasury issues 4,507 4,055 672 440 204 -663 650 Other, reported by U.S. banks -1,158 -706 -1,150 -906 48 -269 -437 Other, reported by U.S. nonbanking concerns 351 -101 -748 -348 -276 67 307 Balance on current account and long-term capital 5. -11,113 -977 -10,686 -2,302 -3,574 -6,513 -673 Not seasonally adjusted -2,441 -6,097 -4,600 -137 Nonliquid short-term private capital flows, net -1,542 -4,238 -12,949 -5,248 -1,462 -2,331 1,911 Claims reported by U.S. banks -1,457 -3,886 -12,186 -5,319 -1,618 -2,432 1,715 Claims reported by U.S nonbanking concerns -306 -1,183 -2,603 -682 -276 -137 250 Liabilities reported by U.S. nonbanking concerns. 221 831 1,840 753 432 238 -54 Allocations of Special Drawing Rights (SDR's) 710 Errors and omissions, net -2,436 4,593 1,332 1 ,126 1,127 1,870 Net liquidity balance -13,829 -7,651 -19,043 -6,218 -3,910 -7,717 3,108 Not seasonally adjusted., -6,654 -5,551 -6,594 4,253 Liquid private capital flows, net 3,475 2,343 10,669 2,020 4,028 2,870 -6,375 Liquid claims -1,247 -1,951 -6,113 -1 ,297 -228 -1,968 -4,755 Reported by U.S. banks -742 -1,161 -5,980 -1,306 -732 -1,599 -5,073 Reported by U.S. nonbanking concerns.. -505 -790 -133 9 504 -369 318 Liquid liabilities— 4,722 4,294 16,782 3,317 4,256 4,838 -1 ,620 Foreign commercial banks 3,717 3,028 12,636 2,413 3,150 2,773 -2,684 International and regional organizations. 103 377 1,295 298 219 1,308 862 Other foreigners 902 2,851 606 887 757 202 Official reserve transactions balance, financed by changes in- -10,354 -5,308 -8,374 -4,198 118 -4,847 -3,267 Not seasonally adjusted -2,220 -4,048 -1,683 -4,049 Liquid liabilities to foreign official agencies 9,734 4,456 8,481 2,758 Other readily marketable liabilities to foreign official agen- 3,930 751 3,864 No c n ie l s iq 6 u id liabilities to foreign official reserve agencies re- 399 1,118 672 183 135 631 841 U. p S o . r o t f e f d i c b ia y l r U es .S e . r v G e o a v s t s ets, net 1 3 8 2 9 -4 2 7 0 5 9 -1,4 6 3 5 4 5 -3 4 5 4 8 3 2 1 1 3 5 7 -3 - 2 6 6 Gold 547 SDR's -703 9 -172 -29 -123 -20 -5 Convertible currencies 35 233 3 -85 -152 241 -14 Gold tranche position in IMF 153 -33 -1,265 -244 -728 -84 -307 Memoranda: Transfers under military grant programs (excluded from lines 2, 4, and 14) 4,492 2,809 1,811 564 352 490 787 Reinvested earnings of foreign incorporated affiliates of U.S. firms (excluded from lines 7 and 20) 4,521 8,124 Reinvested earnings of U.S. incorporated affiliates of foreign firms (excluded from lines 9 and 21) 548 945 Balances excluding allocations of SDR's: Net liquidity, not seasonally adjusted.. -14,539 -7,651 -19,043 -6,654 -5,551 -6,594 4,253 Official reserve transactions, N.S.A... -11,064 -5,308 -8,374 -4,048 -1,683 -4,049 -2,220 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • FOREIGN TRADE; U.S. RESERVE ASSETS A 59 2. MERCHANDISE EXPORTS AND IMPORTS (Seasonally adjusted; in millions of dollars) Exports 1 Imports 2 Trade balance 1972 1973 1974 1975 1972 1973 1974 3 1975 1972 1973 1974 3 1975 Month: Jan 444444,,,,,,000000777777444444 444444,,,,,,999999555555555555 777777,,,,,,111111555555000000 9,412 444444,,,,,,444444333333666666 555555,,,,,,222222444444444444 666666,,,,,,444444999999888888 9,622 ------333333666666111111 ------222222888888999999 ++665522 -211 Feb 333333,,,,,,888888222222444444 555555,,,,,,000000777777000000 777777,,,,,,555555444444999999 8,789 444444,,,,,,444444777777333333 555555,,,,,,444444888888333333 777777,,,,,,333333111111888888 7,872 ------666666444444999999 ------444444111111333333 ++223311 +917 Mar 333333,,,,,,888888666666999999 555555,,,,,,333333111111111111 777777,,,,,,666666222222555555 8,716 444444,,,,,,555555111111555555 555555,,,,,,444444111111444444 777777,,,,,,777777444444222222 7,336 ------666666444444777777 ------111111000000333333 --111177 + 1 ,380 Apr 333333,,,,,,888888222222000000 555555,,,,,,444444999999444444 888888,,,,,,111111000000888888 8,570 444444,,,,,,444444111111777777 555555,,,,,,333333666666000000 888888,,,,,,000000222222555555 8,013 ------555555999999666666 ++++++ 111111333333333333 ++ 8833 + 557 May 333333,,,,,,888888888888222222 555555,,,,,,555555666666111111 777777,,,,,,666666555555222222 8,145 444444,,,,,,444444888888666666 555555,,,,,,777777000000333333 888888,,,,,,222222666666555555 7,093 ------666666000000444444 ------111111444444222222 --661122 + 1,052 June 333333,,,,,,999999777777111111 555555,,,,,,777777222222888888 888888,,,,,,333333111111777777 8,692 444444,,,,,,444444666666888888 555555,,,,,,777777777777555555 888888,,,,,,555555777777777777 6,954 ------444444999999777777 ------444444777777 --226600 + 1 ,737 July 444444,,,,,,000000777777444444 555555,,,,,,888888666666555555 888888,,,,,,333333000000777777 8,885 444444,,,,,,555555666666555555 555555,,,,,,888888222222999999 888888,,,,,,999999222222222222 7,908 ------444444999999111111 ++++++ 333333777777 --661155 +977 Aug 444444,,,,,,111111999999111111 666666,,,,,,000000444444222222 888888,,,,,,333333777777999999 8,996 444444,,,,,,777777222222666666 666666,,,,,,000000111111111111 999999,,,,,,222222666666777777 7,961 ------555555333333555555 ++++++ 333333222222 --888888 + 1,035 Sept 444444,,,,,,111111777777666666 666666,,,,,,444444222222000000 888888,,,,,,333333999999999999 9,165 444444,,,,,,666666111111222222 555555,,,,,,666666444444444444 888888,,,,,,666666999999666666 8,189 ------444444333333666666 ++++++ 777777777777666666 --229977 +976 Oct 444444,,,,,,333333111111222222 666666,,,,,,555555888888555555 888888,,,,,,666666777777333333 444444,,,,,,777777333333888888 555555,,,,,,999999999999666666 888888,,,,,,777777777777333333 ------444444222222666666 ++++++ 555555888888999999 --110000 Nov 444444,,,,,,444444666666888888 666666,,,,,,888888777777999999 888888,,,,,,999999777777333333 555555,,,,,,111111444444888888 666666,,,,,,666666888888444444 888888,,,,,,999999777777333333 ------666666888888000000 ++++++ 111111999999555555 Dec 444444,,,,,,555555555555333333 666666,,,,,,999999444444999999 888888,,,,,,888888666666222222 555555,,,,,,000000000000222222 666666,,,,,,222222999999111111 999999,,,,,,222222555555777777 ------444444444444999999 ++++++ 666666555555888888 ----333399995555 Quarter: I 111111111111,,,,,,777777666666777777 111111555555,,,,,,333333333333666666 222222222222,,,,,,333333222222555555 26,917 111111333333,,,,,,444444222222444444 111111666666,,,,,,111111444444000000 222222111111,,,,,,555555555555888888 24,830 ------111111,,,,,,666666555555777777 ------888888000000444444 ++++777766667777 +2,087 I I 111111111111,,,,,,666666777777333333 111111666666,,,,,,777777888888333333 222222444444,,,,,,000000777777777777 25,406 111111333333,,,,,,333333777777000000 111111666666,,,,,,888888333333999999 222222444444,,,,,,888888666666777777 22,060 ------111111 ,,,,,,666666999999777777 ------555555666666 ----777799990000 + 3,346 II I 111111222222,,,,,,444444444444222222 111111888888,,,,,,333333222222777777 222222555555,,,,,,000000888888555555 27,046 111111333333,,,,,,999999000000333333 111111777777,,,,,,444444888888333333 222222666666,,,,,,888888888888555555 24,057 ------111111,,,,,,444444666666111111 ++++++ 888888444444444444 ----1111,,,,888800000000 +2,989 TV 111111333333,,,,,,333333333333333333 222222000000,,,,,,444444111111333333 222222666666,,,,,,555555000000888888 111111444444,,,,,,888888888888888888 111111888888,,,,,,999999777777222222 222222777777,,,,,,000000000000333333 ------111111,,,,,,555555555555555555 ++++++ 111111 ,,,,,,444444444444111111 ----444499995555 Year 4 444444999999,,,,,,111111999999999999 777777000000,,,,,,888888222222333333 999999777777,,,,,,999999000000888888 555555555555,,,,,,555555888888333333 666666999999,,,,,,444444777777666666 111111000000000000,,,,,,222222555555111111 ------666666,,,,,,333333888888444444 ++++++ 111111,,,,,,333333444444777777 ----2222,,,,333344443333 1 Exports of domestic and foreign merchandise (f.a.s. value basis); basis. For calender year 1974, the f.a.s. import transactions value was excludes Department of Defense shipments under military grant-aid $100.3 billion, about 0.7 per cent less than the corresponding Customs programs. import value of $101.0 billion. 2 General imports, which includes imports for immediate consumption 4 Sum of unadjusted figures. plus entries into bonded warehouses. See also note 3. 3 Beginning with 1974 data, imports are reported on an f.a.s. trans- NOTE.—Bureau of the Census data. Details may not add to totals beactions value basis; prior data are reported on a Customs import value cause of rounding. 3. U.S. RESERVE ASSETS (In millions of dollars) EE yy nn ee dd aa rr oo ff Total To G ta o l2 l d st T o r c e k a 1 s ury v c fo u e C c r r r o i t e r e i n e i b s g - n l n e - p R o I e s M s i i n e t F r io v n e SDR's3 E m n o d n t o h f Total Tot G al o 2 ld s T to re ck a sury v c fo u e C c r r r o i e t r e i n e i b s g - n l n e - p R o e s s i e t r io v n e SDR's3 1961... 18,753 16,947 16,889 116 11111111111,,,,,,,,,,,666666666669999999999900000000000 111111999999777777444444 1962... 17,220 16,057 15,978 99 11111111111,,,,,,,,,,,000000000006666666666644444444444 OOOOOOcccccctttttt 15,890 11,652 11,567 193 1,739 2,306 1963... 16,843 15,596 15,513 212 11111111111,,,,,,,,,,,000000000003333333333355555555555 NNNNNNoooooovvvvvv 15,840 11,652 11,567 43 1,816 2,329 1964... 16,672 15,471 15,388 432 777777777776666666666699999999999 DDDDDDeeeeeecccccc 15,883 11,652 11,652 5 1,852 2,374 1965... 15,450 13,806 13,733 781 888888888886666666666633333333333 111111999999777777555555—————— 1966... 14,882 13,235 13,159 1,321 333333333332222222222266666666666 JJJJJJaaaaaannnnnn 15,948 11,635 11,635 2 1,908 2,403 1967... 14,830 12,065 11,982 2,345 444444444442222222222200000000000 Feb 16,132 11,621 11,621 2 2,065 2,444 1968.. . 15,710 10,892 10,367 3,528 11111111111,,,,,,,,,,,222222222229999999999900000000000 Mar 16,256 11 ,620 11,620 19 2,194 2,423 1969... 416,964 11,859 10,367 42,781 22222222222,,,,,,,,,,,333333333332222222222244444444444 Apr 16,183 11,620 11,620 2 2,168 2,393 May.... 16,280 11,620 11,620 4 2,218 2,438 1970... 14,487 11,072 10,732 629 11111111111,,,,,,,,,,,999999999993333333333355555555555 885511 June 16,242 11,620 11,620 25 2,179 2,418 1971. . . 512,167 10,206 10,132 5 276 555555555558888888888855555555555 11,,110000 July 16,084 11,618 11,618 2 2,135 2,329 19726. . 13,151 10,487 10,410 241 444444444446666666666655555555555 11,,995588 r16,117 11,599 11,599 r28 2,169 2,321 19737 . . 14,378 11,652 11,567 555555555555555555555522222222222 22,,116666 Sept 16,291 11,599 11,599 247 2,144 82,301 1974... 15,883 11,652 11,652 11111111111,,,,,,,,,,,888888888885555555555522222222222 22,,337744 Oct 816,569 11,599 11,599 413 82,192 82,365 1 Includes (a) gold sold to the United States by the IMF with the right total gold stock is $828 million (Treasury gold stock $822 million), reserve of repurchase, and (b) gold deposited by the IMF to mitigate the impact position in IMF $33 million, and SDR's $155 million. on the U.S. gold stock of foreign purchases for the purpose of making 7 Total reserve assets include an increase of $1,436 million resulting gold subscriptions to the IMF under quota increases. For corresponding from change in par value of the U.S. dollar on Oct. 18, 1973; of which, liabilities, see Table 5. total gold stock is $1,165 million (Treas. gold stock $1,157 million) 2 Includes gold in Exchange Stabilization Fund. reserve position in IMF $54 million, and SDR's $217 million. 3 Includes allocations by the IMF of Special Drawing Rights as follows: 8 Beginning July 1974, the IMF adopted a technique for valuing the $867 million on Jan. 1, 1970; $717 million on Jan. 1, 1971; and $710 SDR based on a weighted average of exchange rates for the currencies million on Jan. 1, 1972; plus net transactions in SDR's. of 16 member countries. The U.S. SDR holdings and reserve position 4 Includes gain of $67 million resulting from revaluation of the German in the IMF are also valued on this basis beginning July 1974. At valuamark in Oct. 1969, of which $13 million represents gain on mark holdings tion used prior to July 1974 (SDR 1 = $1.20635) SDR holdings at end at time of revaluation. of Oct. amounted to $2,427 million reserve position in IMF, $2,233 5 Includes $28 million increase in dollar value of foreign currencies million, and total U.S. reserve assets, $16,672. revalued to reflect market exchange rates as of Dec. 31, 1971. 6 Total reserve assets include an increase of $1,016 million resulting NOTE.—See Table 20 for gold held under earmark at F.R. Banks for from change in par value of the U.S. dollar on May 8, 1972; of which, foreign and international accounts. Gold under earmark is not included in the gold stock of the United States. NOTES TO TABLE 1 ON OPPOSITE PAGE: 1 Adjusted to balance of payments basis; excludes exports under U.S. resenting the refinancing of economic assistance loans to India; a cormilitary agency sales contracts, and imports of U.S. military agencies. responding reduction of credits is shown in line 16. 2 Fees and royalities from U.S. direct investments abroad or from 5 Includes some short-term U.S. Govt, assets. foreign direct investments in the United States are exduded from invest- 6 Includes changes in long-term liabilities reported by banks in the ment income and included in "Other services." United States and in investments by foreign official agencies in debt 3 Includes special military shipments to Israel that are excluded from the securities of U.S. Federally-sponsored agencies and U.S. corporations. "net exports of goods and services" in the national income and products (GNP) accounts of the United States. NOTE.—Data are from U.S. Department of Commerce, Bureau of Eco- 4 Includes under U.S. Government grants $2 billion equivalent, rep- nomic Analysis. Details may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 60 GOLD RESERVES • NOVEMBER 1975 4. GOLD RESERVES OF CENTRAL BANKS AND GOVERNMENTS (In millions of dollars; valued at $35 per fine ounce through Apr. 1972, at $38 from May 1972-Sept. 1973, and at $42.22 thereafter) Esti- Intl. Esti- China, End of mated Mone- United mated Algeria Argen- Aus- Aus- Bel- Canada Rep. of Den- Egypt period total tary States rest of tina tralia tria gium (Taiwan) mark world1 Fund world 1970. 41,275 4,339 11,072 25,865 191 140 239 714 1,470 791 64 85 1971. 41,160 4,732 10,206 26,220 192 90 259 729 1,544 792 64 85 1972. 44,890 5,830 10,487 28,575 208 152 281 792 1,638 834 69 92 1973. 49,850 6,478 11,652 31,720 231 169 311 881 1,781 927 77 103 1974—Sept., 49,830 6,478 11,652 31,700 231 169 312 882 1,781 927 76 103 Oct.. 6,478 11,652 231 169 312 882 1,781 927 76 103 Nov.. 6,478 11,652 231 169 312 882 1,781 927 76 103 Dec.. 49,790 6,478 11,652 31,660 231 169 312 882 1,781 927 76 103 1975—Jan... 6,478 11,635 231 169 312 882 1,781 927 76 103 Feb.., 6,478 11,621 231 169 312 882 1 ,781 927 76 103 Mar.. 49,760 6,478 11,620 31,660 231 169 312 882 1 ,781 927 76 103 Apr.. 6,478 11,620 231 169 312 882 1 ,781 927 76 103 J M u a n y e . . *49,760 6 6, , 4 4 7 7 8 8 1 1 1 1 , , 6 6 2 2 0 0 p3l ,660 2 2 3 3 1 1 1 1 6 6 9 9 3 3 1 1 2 2 8 88 8 2 2 1 1 , , 7 7 8 8 1 1 9 9 2 2 7 7 7 7 6 6 1 1 0 0 3 3 July.. 6,478 11,618 231 169 312 882 1,781 927 76 103 Aug.. 6,478 11.599 231 312 882 1 ,781 927 76 Sept.* 6,478 11,599 231 312 882 1,781 927 76 End of France Ger- Greece India Iran Iraq Italy Japan Kuwait Leb- Libya Mexi- Netherperiod many anon co lands 1970 3,532 3,980 117 243 131 144 2,887 532 86 288 85 176 1,787 1971 3,523 4,077 98 243 131 144 2,884 679 87 322 85 184 1,909 1972 3,826 4,459 133 264 142 156 3,130 801 94 350 93 188 2,059 1973 4,261 4,966 148 293 159 173 3,483 891 120 388 103 196 2,294 1974—Sept 4,262 4,966 150 293 158 173 3,483 891 130 389 103 154 2,294 Oct 4,262 4,966 150 293 158 173 3,483 891 138 389 103 154 2,294 Nov 4,262 4,966 150 293 158 173 3,483 891 138 389 103 154 2,294 Dec 4,262 4,966 150 293 158 173 3,483 891 148 389 103 154 2,294 1975—Jan 4,262 4,966 150 293 158 173 3,483 891 140 389 103 154 2,294 Feb 4,262 4,966 150 293 158 173 3,483 891 140 389 103 154 2,294 Mar 4,262 4,966 150 293 158 173 3,483 891 154 389 103 154 2,294 Apr 4,262 4,966 150 293 158 173 3,483 891 154 389 103 154 2,294 May 4,262 4,966 150 293 158 173 3,483 891 175 389 103 154 2,294 June 4,262 4,966 150 293 158 173 3,483 891 154 389 103 154 2,294 July 4,262 4,966 150 293 158 173 3,483 891 154 389 103 2,294 Aug 444,,,222666222 444,,,999666666 111555000 229933 111555888 117733 333,,,444888333 888999111 111555444 338899 111000333 222,,,222999444 Sept. 444,,,222666222 444,,,999666666 111555000 111555888 333,,,444888333 888999111 111555444 111000333 222,,,222999444 United Bank End of Paki- Portu- Saudi South Spain Sweden Switzer- Thai- Turkey King- Uru- Vene- for Intl. period stan gal Arabia Africa land land dom guay zuela Settlements2 1970 54 902 119 666 498 200 2,7.32 92 126 1,349 162 384 -282 1971 55 921 108 410 498 200 2,909 82 130 775 148 391 310 1972 60 1,021 117 681 541 217 3,158 89 136 800 133 425 218 1973 67 1,163 129 802 602 244 3,513 99 151 886 148 472 235 1974—Sept 67 1,180 129 778 602 244 3,513 99 151 886 148 472 259 Oct 67 1,180 129 786 602 244 3,513 99 151 886 148 472 271 Nov 67 1,180 129 774 602 244 3,513 99 151 886 148 472 251 Dec 67 1,180 129 771 602 244 3,513 99 151 886 148 472 250 1975—Jan 67 1 ,175 129 764 602 244 3,513 99 151 886 148 472 265 Feb 67 1 ,175 129 759 602 244 3,513 99 151 886 148 472 272 Mar 67 1,175 129 755 602 244 3,513 99 151 886 148 472 259 Apr 67 1,175 129 747 602 244 3,513 99 151 886 148 472 260 May 67 1,175 129 742 602 244 3,513 99 151 886 148 472 239 June 67 1,175 129 734 602 244 3,513 99 151 886 148 472 262 July 67 1 175 129 742 602 244 3,513 99 151 148 472 264 Aug 666777 11,,117755 111222999 777444444 660022 222444444 333,,,555111333 999999 115511 444777222 222666444 Sept.p 666777 111222999 777666222 222444444 333,,,555111333 999999 444777222 222666444 1 Includes reported or estimated gold holdings of international and The figures included for the Bank for International Settlements are regional organizations, central banks and govts, of countries listed in the Bank's gold assets net of gold deposit liabilities. This procedure this table, and also of a number not shown separately here, and gold to be avoids the overstatement of total world gold reserves since most of the distributed by the Tripartite Commission for the Restitution of Monetary gold deposited with the BIS is included in the gold reserves of individual Gold; excludes holdings of the U.S.S.R., other Eastern European coun- countries. tries, and People's Republic of China. 2 Net gold assets of BIS, i.e., gold in bars and coins and other gold assets minus gold deposit liabilities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INTL. CAPITAL TRANSACTIONS OF THE U.S. A 61 5. U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS, AND LIQUID LIABILITIES TO ALL OTHER FOREIGNERS (In millions of dollars) Liabilities to foreign countries Liquid Official institutions2 Liquid liabilities to other liabili- foreigners ties to IMF Liquid Total arising Short- liabili- Shortfrom term Market- Non- Other ties term Marketgold liabili- able market- readily to com- liabili- able trans- ties re- U.S. able U.S. market- mercial ties re- U.S. actions1 Total ported Treas. Treas. able banks Total ported Treas. by bonds bonds liabili- abroad6 by bonds banks and and ties5 banks and in notes3 notes4 in notes3,7 U.S. U.S. 26,394 800 14,425 12,467 1,183 766 5,817 3,387 3,046 J29.313 800 15,790 13,224 1.125 1,283 158 7.271 3,730 3,354 \29,364 800 15,786 13,220 1,125 1,283 158 7,303 3,753 3,377 29,568 834 15,825 1,105 1,534 120 7,419 4,059 3,587 /31,144 1,011 14,840 12,484 860 583 913 10,116 4.271 3.743 131,019 1,011 14,895 12,539 860 583 913 9,936 4.272 3.744 J35,819 1,033 18.201 14,034 908 1,452 1 .807 11,209 4.685 4.127 \35,667 1,033 18,194 14,027 1,452 1,807 11,085 4,678 4.120 J38,687 1.030 17,407 11,318 529 3,219 2,341 14,472 5,053 4,444 138,473 1,030 17,340 11,318 462 3,219 2.341 14,472 4,909 4,444 ">/45,755 1,109 1015,975 11,054 346 10 3,070 1,505 23,638 4,464 3,939 145,914 1,019 15,998 11,077 346 3,070 1,505 23,645 4,589 4,064 J47,009 566 23,786 19,333 306 3,452 695 17,137 4,676 4,029 146,960 566 23,775 19,333 295 3,452 695 17,169 4,604 4,039 /67,681 544 51.209 39,679 1,955 9.431 144 10,262 4,138 3,691 167,808 544 50,651 39,018 1,955 9,534 144 10,949 4,141 3,694 82,862 61,526 40,000 5,236 15,747 543 14,666 5,043 4,618 1292,456 1266,827 243.923 5,701 1215,530 1,673 17,694 5.932 5.502 110,810 72,730 50.149 4,880 15.985 1,716 28,056 8,010 7,617 112,137 73.836 50,921 4,880 16,196 1,839 28,095 8,058 7,627 115,698 75,200 51,860 4.906 16,196 2.238 29,782 8,336 7,855 119,097 76,658 53,057 5,059 16,196 2; 346 30,314 8,803 8,305 118,189 75.960 51,832 5,177 16,324 2,627 29,414 8,629 8.121 119,584 78,689 54,310 5,279 16,324 2,776 27,629 9,015 8,405 120,170 79.210 53,696 6,003 16,324 3,187 27,773 9.004 8,368 121,163 79,081 53,521 5,941 16,365 3,254 29,194 8,809 8.154 121,627 79,751 52,351 6,064 17.925 3,411 28,588 9.049 8.426 121.705 80,468 51,814 6,119 19,027 3,508 28,615 9,109 8,455 122;592 79,705 50,308 6,160 19,474 3,763 29,577 9,032 8,322 123,950 79,254 49,912 6,276 19,324 3,742 30,786 9,555 8,884 123,032 77,799 48.063 6.452 19.524 3.760 30,728 9.787 9.086 1 Includes (a) liability on gold deposited by the IMF to mitigate the 10 Includes $101 million increase in dollar value of foreign currency impact on the U.S. gold stock of foreign purchases for gold subscriptions liabilities resulting from revaluation of the German mark in Oct. 1969. to the IMF under quota increases, and (b) U.S. Treasury obligations at 11 Data on the second line differ from those on first line because cercost value and funds awaiting investment obtained from proceeds of sales tain accounts previously classified as official institutions are included of gold by the IMF to the United States to acquire income-earning assets. with banks; a number of reporting banks are included in the series for 2 Includes BIS and European Fund. the first time; and U.S. Treasury securities payable in foreign currencies 3 Derived by applying reported transactions to benchmark data; issued to official institutions of foreign countries have been increased in breakdown of transactions by type of holder estimated for 1963. value to reflect market exchange rates as of Dec. 31, 1971. 4 Excludes notes issued to foreign official nonreserve agencies. 12 Includes $162 million increase in dollar value of foreign currency 5 Includes long-term liabilities reported by banks in the United States liabilities revalued to reflect market exchange rates, as follows: shortand debt securities of U.S. Federally-sponsored agencies and U.S. cor- term liabilities, $15 million; and nonmarketable U.S. Treasury notes, porations. $147 million. 6 Includes short-term liabilities payable in dollars to commercial banks abroad and short-term liabilities payable in foreign currencies to commer- NOTE.—Based on Treasury Dept. data and on data reported to the cial banks abroad and to other foreigners. Treasury Dept. by banks and brokers in the United States. Data correspond 7 Includes marketable U.S. Treasury bonds and notes held by commer- generally to statistics following in this section, except for the exclusion cial banks abroad. of nonmarketable, nonconvertible U.S. Treasury notes issued to foreign 8 Principally the International Bank for Reconstruction and Develop- official nonreserve agencies, the inclusion of investments by foreign ment and the Inter-American and Asian Development Banks. official reserve agencies in debt secu-ities of U.S. Federally-sponsored 9 Data on the 2 lines shown for this date differ because of changes agencies and U.S. corporations, and minor rounding differences. Table in reporting coverage. Figures on first line are comparable with those excludes IMF holdings of dollars, and holdings of U.S. Treasury letters shown for the preceding date; figures on second line are comparable with of credit and nonnegotiable, non-interest-bearing special U.S. notes held those shown for the following date. by other international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 62 INTL. CAPITAL TRANSACTIONS OF THE U.S. • NOVEMBER 1975 6. U.S. LIABILITIES TO OFFICIAL INSTITUTIONS OF FOREIGN COUNTRIES, BY AREA (Amounts outstanding; in millions of dollars) Total Western Latin Other foreign Europe1 American countries2 End of period countries Canada republics Asia Africa 1971 50,651 30,134 3,980 1,429 13,823 415 870 1972 61,526 34,197 4,279 1,733 17,577 777 2,963 1973 66,827 45,730 3,853 2,544 10,887 788 3,025 1974—Sept 72,730 42,662 3,819 4,445 16,299 2,850 2,655 Oct 73,836 43,019 3,805 4,046 17,329 2,947 2,690 Nov 75,200 43,193 3,705 3,768 18,673 3,204 2,657 Dec 76,658 44,185 3,662 4,419 18,604 3,161 2,627 1975—Jan 75,960 43,331 3,621 3,659 19,555 3,232 2,562 Feb 78,689 44,770 3,616 4,223 20,274 3,356 2,450 Mar.. 79,210 45,776 3,546 4,390 19,441 3,433 2,624 Apr 79,081 45,059 3,251 4,506 20,062 3,493 2,710 May 79,751 45,262 3,101 4,600 20,423 3,448 2,917 June 80,468 45,211 3,008 4,723 20,457 3,800 3,269 July 79,705 44,241 2,966 4,748 21,299 3,319 3,132 Aug.p 79,254 44,063 2,929 4,924 29,972 3,392 2,974 Sept.25... . 77,799 43,322 3,011 4,830 20,734 3,139 2,763 1 Includes Bank for International Settlements and European Fund. foreign official holdings of marketable and nonmarketable U.S. Treasury 2 Includes countries in Oceania and Eastern Europe, and Western Euro- securities with an original maturity of more than 1 year, except for nonpean dependencies in Latin America. marketable notes issued to foreign official nonreserve agencies; and investments by foreign official reserve agencies in debt securities of U.S. NOTE.—Data represent short- and long-term liabilities to the official Federally-sponsored agencies and U.S. corporations. institutions of foreign countries, as reported by banks in the United States; 7. SHORT-TERM LIABILITIES TO FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES, BY TYPE (Amounts outstanding; in millions of dollars) To nonmonetary international To all foreigners and regional organizations6 IMF Payable in dollars gold Deposits Payable invest- U.S. in ment5 Treasury Total i Deposits U.S. Other foreign bills and Treasury short- cur- certifibills and term rencies cates Demand Time2 certifi- liab.4 cates3 55,428 55,036 6,459 4,217 33,025 11,335 392 400 1,367 73 192 210 60,696 60,200 8,290 5,603 31,850 14,457 496 1,412 86 202 326 69,074 68,477 11,310 6,882 31,886 18,399 597 1,955 101 83 296 87,722 87,026 12,769 9,252 33,467 31,539 696 1,900 128 69 75 88,642 87,924 11,228 9,822 34,187 32,686 719 2,000 125 92 93 91.835 91,091 12,860 9,567 35,212 33,452 744 2,339 128 95 285 94,847 94,081 14,068 10,106 35,662 34,246 766 3,171 139 111 497 93,285 92,564 12,288 10,155 38,108 32,013 721 3,918 123 111 1,234 94,317 93,584 12,139 10,308 40,428 30,708 733 3,973 118 102 1,260 93.322 92,640 12,324 10,143 40,094 30,080 682 3,485 189 116 777 94,460 93,719 11,699 10,390 40,424 31,206 742 3,592 99 126 781 93,204 92,539 11,925 10.374 40,628 29,612 665 3,839 115 133 1,994 92.323 91,739 12,595 10,471 38,265 30,408 584 3,439 106 133 996 92,316 91,755 12,215 10.375 38,553 30,612 560 4,109 146 134 2,518 93.836 93,273 12,215 10,809 38,518 31,732 562 4,253 110 148 3,156 92,508 91,954 13,422 10,491 36,642 31,399 554 4,631 107 127 3,008 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INTL. CAPITAL TRANSACTIONS OF THE U.S. A 63 7. SHORT-TERM LIABILITIES TO FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES, BY TYPE—Continued (Amounts outstanding; in millions of dollars) Total to official, banks and other foreigners To official institutions 8 Payable in dollars Payable in dollars Payable End of period in Deposits U.S. Other foreign Total Deposits U.S. Other Treasury short- cur- Treasury shortbills and term rencies bills and term Demand Time2 certifi- liab.4 Demand Time2 certifi- liab.7 cates3 cates3 197 2 59,284 8,204 5,401 31,523 13,659 496 40,000 1,591 2,880 31,453 3,905 197 3 67,119 11,209 6,799 31,590 16,925 597 43,923 2,125 3,911 31,511 6,248 1974—Sept.. 85,822 12,641 9,183 33,392 29,910 696 50,149 2,825 4,282 32,955 9,960 Oct... 86,643 11,104 9,730 34,094 30,996 719 50,921 2,168 4,400 33,634 10,591 Nov.. 89,497 12,732 9,472 34,927 31,622 744 51,860 2,472 4,058 34,467 10,736 Dec... 91,676 13,928 9,995 35,165 31,822 766 53,057 2,951 4,257 34,656 11,066 1975—Jan... 89,367 12,165 10,044 36,874 29,563 721 51,832 2,185 4,296 36,531 8,821 Feb.. . 90,344 12,021 10,206 39,169 28,216 733 54,310 2,058 4,306 38,840 9,106 Mar.. 89,837 12,135 10,027 39,316 27,677 682 53,696 2,323 4,303 39,015 8,054 Apr.. 90,869 11,600 10,264 39,643 28,620 742 53,521 2,147 4,193 39,316 7,864 May., 89,365 11,811 10,241 38,634 28,015 665 52,351 2,175 4,331 38,372 7,473 June. 88,884 12,490 10,338 37,269 28,203 584 51,814 2,564 4,256 36,994 8,000 July.. 88,207 12,070 '10,241 36,035 '29,301 560 50,308 2.492 4,098 35,803 7,915 Aug.**. 89,582 12,104 10,661 35,362 30,893 562 49,912 2.493 4,239 35,055 8,125 Sept.p 87,877 13,315 10,363 33,634 30,010 554 48,063 2,452 3,987 33,284 8,341 To banks9 To other foreigners TTTToooo bbbbaaaannnnkkkkssss Payable in dollars aaaannnndddd ooootttthhhheeeerrrr ffffoooorrrreeeeiiiiggggnnnneeeerrrrssss EEEEnnnndddd ooooffff ppppeeeerrrriiiioooodddd TTTToooottttaaaallll PPPPaaaayyyyaaaabbbblllleeee iiiinnnn Deposits UU..SS.. OOtthheerr Deposits UU..SS.. OOtthheerr ffffoooorrrreeeeiiiiggggnnnn TTrreeaassuurryy sshhoorrtt-- TTrreeaassuurryy sshhoorrtt-- ccccuuuurrrr---- TToottaall bbiillllss aanndd tteerrmm TToottaall bbiillllss aanndd tteerrmm rrrreeeennnncccciiiieeeessss Demand Time2 cceerrttiiffii-- lliiaabb..44 Demand Time2 cceerrttiiffii-- lliiaabb..77 ccaatteess ccaatteess 1972 19,284 14,340 4,658 405 5 9,272 4,618 1,955 2,116 65 481 325 1973 23,196 17,224 6,941 529 11 9,743 5,502 2,143 2,359 68 933 469 1974—Sept 35,673 27,488 7,096 11,,663377 258 18,497 7,617 2,721 3,264 179 1,454 568 Oct 35,722 27,504 6,361 11,,990088 268 18,967 7,626 2,574 3,422 193 1,438 591 Nov 37,637 29,166 7,622 1,807 253 19,484 7,855 2,638 3,608 207 1,402 617 Dec 38,619 29,676 8,248 1,942 232 19,254 8,304 2,729 3,796 277 1,502 639 1975—Jan 37,534 28,693 7,355 1,989 158 19,192 8,121 2,625 3,760 186 1,550 721 Feb 36,035 26,896 7,142 2,039 129 17,586 8,405 2,820 3,861 200 1,524 733 Mar 36,142 27,092 7,072 1,808 101 18,111 8,368 2,740 3,916 200 1,512 682 Apr 37,348 28,453 6,897 2,102 107 19,347 8,154 2,556 3,969 220 1,409 742 May 37,014 27,923 6,852 1,821 105 19,144 8,426 2,784 4,089 156 1,398 665 June 37,070 28,032 7,067 1 ,949 99 18,917 8,454 2,859 4,133 176 1,286 584 July 37,899 29,016 6,882 '2,036 80 '20,018 8,322 2,696 4,107 152 1,367 560 Aug.** 39,670 30,224 6,907 1,829 77 21,411 8,884 2,705 4,592 230 1,357 562 Sept.25 39,814 30,174 7,983 1,771 78 20,341 9,086 2,881 4,605 272 1,329 554 1 Data exclude "holdings of dollars" of the IMF. 7 Principally bankers' acceptances, commercial paper, and negotiable 2 Excludes negotiable time certificates of deposit, which are included time certificates of deposit. in "Other short-term liabilities." 8 Foreign central banks and foreign central govts, and their agencies, 3 Includes nonmarketable certificates of indebtedness and Treasury and Bank for International Settlements and European Fund. bills issued to official institutions of foreign countries. 9 Excludes central banks, which are included in "Official institutions." 4 Includes liabilities of U.S. banks to their foreign branches, liabilities of U.S. agencies and branches of foreign banks to their head offices and NOTE.—"Short term" obligations are those payable on demand or having foreign branches, bankers' acceptances, commercial paper, and negotiable an original maturity of 1 year or less. For data on long-term liabilities time certificates of deposit. reported by banks, see Table 9. Data exclude the holdings of dollars 5 U.S. Treasury bills and certificates obtained from proceeds of sales of of the International Monetary Fund; these obligations to the IMF constigold by the IMF to the United States to acquire income-earning assets. tute contingent liabilities, since they represent essentially the amount of Upon termination of investment, the same quantity of gold was reac- dollars available for drawings from the IMF by other member countries. quired by the IMF. Data exclude also U.S. Treasury letters of credit and nonnegotiable, non- 6 Principally the International Bank for Reconstruction and Develop- interest-bearing special U.S. notes held by the Inter-American Development and the Inter-American and Asian Development Banks. ment Bank and the International Development Association. Includes difference between cost value and face value of securities in IMF gold investment account. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 64 INTL. CAPITAL TRANSACTIONS OF THE U.S. • NOVEMBER 1975 8. SHORT-TERM LIABILITIES TO FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES, BY COUNTRY (End of period. Amounts outstanding; in millions of dollars) 1973 1974 1975 AArreeaa aanndd ccoouunnttrryy Dec. Dec. Jan. Feb. Mar. Apr. May June July Aug.'0 Sept.** Europe: Austria 161 607 597 624 599 629 627 627 661 667 688 Belgium-Luxembourg 1,483 2,506 2,391 2,647 2,539 2,810 2,875 3,070 2,982 2.890 2.863 Denmark 659 369 369 324 370 340 323 355 325 308 311 Finland 165 266 204 204 202 212 181 365 361 406 391 3,483 4,287 4,206 4,035 4,226 4,600 4,982 5,397 5,515 5,493 5,949 Germany 13,227 9,420 9,948 10,801 11,235 10,229 8,203 6,460 5,440 5,277 4,797 389 248 253 242 192 202 273 254 299 307 361 Italy 1,404 2,617 2,101 2,260 2,449 2,498 2,157 2,298 1,427 1,056 1,426 Netherlands 2,886 3,234 3,208 3,197 3,414 3,302 3,351 3,535 3.539 3,300 3,059 965 1,040 874 826 843 827 846 945 1 J18 1,052 982 534 310 310 303 288 247 267 264 280 268 207 305 382 379 320 358 361 341 362 392 288 459 1,885 1,138 1,132 1,215 1,209 1,477 1,697 1 ,847 2,010 2,203 2,195 Switzerland 3,377 9,986 9,517 9,407 8,802 8,747 8,553 8,458 7,892 8,298 8.066 Turkey 98 152 169 131 243 103 87 124 106 134 116 United Kingdom 6,148 7,559 6,671 6,205 7,025 7,039 6,980 6,403 6,447 8,330 6,247 86 183 187 168 158 122 126 83 106 104 128 Other Western Europe i 3,352 4,073 3,136 2,934 2,641 2,516 2,467 2,462 2.535 2.261 ! 2,371 U.S.S.R 22 82 65 59 35 34 61 62 29 50 i 39 Other Eastern Europe 110 206 172 120 218 123 148 370 181 160 • 272 Total 40,742 48,667 45,888 46,020 47,045 46,419 ! 44,546 43,743 41,642 42,854 1 40,929 Canada 3,627 3,517 3,398 3,781 3,448 3,946 ! 3,951 3,617 3,921 3,637 3,944 Latin America: Argentina 924 886 900 894 822 886 964 989 1,061 11,,005544 984 Bahamas 852 1,448 2,155 2,046 1,746 2,446 2,045 2,181 2,471 2,670 i 1,976 Brazil 860 1,034 859 927 1,065 1,077 984 1,081 853 921 1,016 Chile 158 276 284 281 258 278 260 289 301 280 293 Colombia 247 305 319 317 326 313 307 400 375 367 379 1,296 1,770 1,747 1.814 1,668 1,727 1,876 1,819 1,794 1,811 1,861 Panama 282 488 500 476 519 656 514 473 584 575 664 Peru 135 272 256 238 225 217 206 219 228 208 245 Uruguay 120 147 152 164 171 174 168 155 190 153 198 1,468 3,413 2,918 3,351 3,501 3,559 3,866 3,726 3,964 4,242 4,247 Other Latin American republics 884 1,316 1,211 1,263 1,348 1,401 1,353 1,506 1.410 1,366 1,467 Netherlands Antilles and Surinam 71 158 155 133 143 113 123 134 107 108 115 Other Latin America 366 526 905 478 507 761 903 991 1,479 1,494 1,887 Total 7,664 12,038 12,361 12,382 12,300 13,610 ! 13,571 13,964 14,819 15,250 15,329 Asia: China, People's Rep. of (China Mainland) 38 50 50 73 62 63 ! 56 65 50 55 94 China, Republic of (Taiwan) 757 818 977 1,015 1,037 1,038 999 1,071 1,015 1,054 1,058 Hong Kong 372 530 558 546 528 543 596 598 540 577 741 India 85 261 179 177 183 127 168 145 133 214 214 Indonesia 133 1,221 1,327 1.083 497 582 279 365 527 289 234 327 386 417 473 508 490 536 470 369 343 322 Japan 6,967 10,897 10,442 10,909 11,390 10,993 11,109 11.223 11,669 11.218 11,128 Korea 195 384 315 327 311 345 341 361 366 374 342 Philippines 515 747 702 642 745 660 662 697 632 669 604 Thailand 247 333 337 327 455 446 342 370 284 255 207 Middle East oil-exporting countries2. .. . 648 4,633 4.960 5.213 3,673 3.922 4,315 3,850 4,437 4,819 5,126 Other 1,202 813 1,043 923 978 905 861 906 767 919 970 Total 10,839 21,073 21,307 21,708 20,368 20,112 20,262 20,119 20,790 20,785 21,040 Africa: Egypt 35 103 105 106 92 112 113 514 253 295 183 South Africa 114 130 150 188 191 159 179 141 132 147 254 Oil-exporting countries 3 521 2.814 2,858 2,943 3,041 3,070 3.009 2,965 2,785 2,873 2,649 Other 907 504 551 572 524 526 594 572 558 553 560 Total 1,056 3,551 3,664 3,809 3,848 3,867 3,895 4,192 3,727 3,866 3,646 Other countries: Australia 3,131 2,742 2,661 2,568 2,761 2,856 3,069 3,185 3,231 3.114 2,912 All other 59 89 88 76 66 60 71 64 77 75 78 Total 3,190 2,831 2,748 2,644 2,828 2,916 3,140 3,249 3,308 3,189 2,989 Total foreign countries 67,119 91,676 89,367 90,344 89,837 90,869 89,365 88,884 88,207 89,582 87,877 International and regional: International4 1,627 2,900 3,643 3,683 3,222 3,291 3,600 3,205 3,844 3,950 i 4,351 Latin American regional 272 202 226 233 218 211 155 141 175 215 : 186 Other regional5 57 69 50 57 44 90 84 94 90 88 | 94 Total 1,955 3,171 3,918 3,973 3,485 3,592 3,839 3,439 4,109 4,254 | 4,631 Grand total 69,074 94,847 93,285 94,317 93,322 94,460 93,204 92,323 92,316 93,836 92,508 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INTL. CAPITAL TRANSACTIONS OF THE U.S. A 65 8. SHORT-TERM LIABILITIES TO FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES, BY COUNTRY—Continued (End of period. Amounts outstanding; in millions of dollars) Supplementary data6 1974 1973 1975 Area and country Area and country Apr. Dec. Apr. Dec. Apr. Apr. Dec. Apr. Dec. Apr. Other Western Europe: Other Asia—Cont.: Cyprus 9 19 10 7 17 Cambodia 3 2 4 4 Iceland 12 8 11 21 20 Jordan 4 6 6 22 30 Ireland, Rep. of 22 62 53 29 29 Laos 3 3 3 3 5 Lebanon 55 62 68 119 180 Other Latin American republics: Malaysia 59 58 40 63 92 Bolivia 65 68 102 96 93 Pakistan 93 105 108 91 118 Costa Rica 75 86 88 117 120 Singapore 53 141 165 240 215 Dominican Republic 104 118 137 127 214 Sri Lanka (Ceylon) 6 13 13 14 13 Ecuador 109 92 90 122 157 Vietnam 98 126 70 El Salvador 86 90 129 129 144 Guatemala 127 156 245 214 255 Haiti 25 21 28 35 34 Honduras 64 56 71 88 92 Other Africa: Jamaica 32 39 52 69 62 Ethiopia (incl. Eritrea) 75 79 118 95 76 Nicaragua 79 99 119 127 125 Ghana 28 20 22 18 13 Paraguay 26 29 40 46 38 Kenya 19 23 20 31 32 Trinidad and Tobago 17 17 21 107 Liberia 31 42 29 39 33 Southern Rhodesia. . . 1 2 1 2 3 Other Latin America: Sudan 3 3 2 4 14 Bermuda 127 242 201 107 100 Tanzania 16 12 12 11 21 British West Indies 100 109 354 116 610 Tunisia 11 7 17 19 23 Uganda 19 6 11 13 Other Asia: Zambia 37 22 66 22 18 Af jghanistan 19 22 11 18 Burma 17 12 42 65 All other: New Zealand 34 39 33 47 36 1 Includes Bank for International Settlements. 5 Asian, African, and European regional organizations, except BIS, 2 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, which is included in "Europe." and United Arab Emirates (Trucial States). 6 Represent a partial breakdown of the amounts shown in the other 3 Comprises Algeria, Gabon, Libya, and Nigeria. categories (except "Other Eastern Europe"). 4 Data exclude holdings of dollars of the International Monetary Fund. 9. LONG-TERM LIABILITIES TO FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES (Amounts outstanding; in millions of dollars) To foreign countries Country or area TToo iinnttll.. EEnndd ooff ppeerriioodd TToottaall aanndd Official Other United Total All rreeggiioonnaall Total institu- Banksi foreign- Ger- King- Total Latin Middle Other other tions ers many dom Europe America East2 Asia3 countries 1972 11111,,,,,000001111188888 555558888800000 444443333399999 9999933333 222225555599999 8888877777 111116666655555 6666633333 222226666600000 111113333366666 3333333333 1111100000 1973 11111,,,,,444446666622222 777776666611111 777770000000000 333331111100000 222229999911111 111110000000000 111115555599999 6666666666 444447777700000 111113333322222 8888833333 1111166666 1974—Sept 11111,,,,,333336666677777 999992222200000 444444444477777 9999933333 222228888811111 7777733333 111115555533333 5555555555 222224444400000 111112222233333 7777711111 1111133333 Oct 11111,,,,,222229999933333 888884444499999 444444444455555 111111111111111 222226666633333 7777711111 111115555533333 4444433333 222222222288888 111111111166666 8888888888 1111133333 Nov 11111 ,,,,,333335555544444 999990000055555 444444444499999 111111111122222 222226666622222 7777755555 111115555522222 4444433333 222222222277777 111111111166666 8888899999 1111177777 Dec 1,285 822 464 124 261 79 152 43 227 115 95 7 20 19 75 _jan 1,406 846 560 223 266 71 150 42 218 118 189 12 21 Feb 1,441 776 666 336 264 66 147 41 211 119 304 10 21 Mar 1 ,548 800 748 426 255 67 137 41 202 120 394 10 21 Apr 1,410 626 784 462 253 68 135 41 201 121 429 11 22 May 1,446 585 861 544 248 69 129 41 197 121 514 7 21 June 1,411 518 893 576 247 70 120 59 198 121 544 7 23 July 1,409 438 970 651 242 77 121 61 201 121 619 7 24 Aug.® 1,352 378 974 651 243 81 120 61 202 123 619 7 23 Sept.p 1,374 401 973 653 241 79 118 61 201 121 621 7 23 1 Excludes central banks, which are included with "Official institutions." Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial 2 Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, States). 3 Until Dec. 1974 includes Middle East oil-exporting countries. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 66 INTL. CAPITAL TRANSACTIONS OF THE U.S. • NOVEMBER 1975 10. ESTIMATED FOREIGN HOLDINGS OF MARKETABLE U.S. TREASURY BONDS AND NOTES (End of period; in millions of dollars) 1974 1975 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June Julyp Aug.p Sept.P Europe: 10 10 10 10 11 1122 1144 14 14 14 14 14 14 Germay 9 9 9 9 9 9 208 209 209 209 209 210 217 250 250 276 251 252 252 252 252 251 252 252 278 275 34 30 30 30 31 30 29 32 34 37 37 41 44 Other Western Europe 4r5 8 9 7 4 r9 8 3 5 4 r8 9 9 8 4 r8 9 8 3 5 r8 2 0 9 5 r 7 7 4 8 5 r7 9 9 9 6 r9 1 5 1 5 r9 6 7 4 5 9 2 7 2 5 9 3 8 6 5 1 2 0 0 2 5 1 0 1 1 4 5 5 5 5 5 5 5 5 5 5 5 5 5 Total 854 883 917 885 916 959 1,186 1,217 1,174 1,135 1,151 1 ,169 1,170 706 707 711 713 697 584 588 460 412 412 408 406 404 Latin America: Latin American republics 11 11 11 12 11 11 1111 11 11 13 13 13 13 Netherlands Antilles and Surinam . . 15 23 60 83 82 142 130 125 118 134 178 149 149 Other Latin America 2 2 2 5 6 6 5 4 4 5 5 5 5 Total 28 36 74 100 99 159 147 140 133 152 196 167 168 Asia: Japan 3,497 3,497 3,498 3,498 3,498 3,496 3,496 3,496 3,496 3,496 3,496 3,496 3,502 Other Asia 12 12 12 212 325 541 1,071 1,121 1,291 1,397 1,418 1,498 1,648 Total 3,509 3,509 3,509 3,709 3,822 4,037 4,567 4,617 4,787 4,893 4,914 4,994 5,149 151 151 151 151 151 151 151 161 181 181 201 211 261 All other 25 25 25 5,273 5,311 5,387 5,557 5,685 5,889 6,639 6,596 6,687 6,773 6,870 6,945 7,153 International and regional: International 46 97 98 89 207 219 620 411 334 21 121 58 44 Latin American regional 68 52 67 61 61 59 79 77 65 52 48 43 43 Total 114 149 165 150 268 277 699 488 399 74 169 101 87 Grand total 5,387 5,460 5,552 5,708 5,953 6,167 7,337 7,084 7,087 6,847 7,039 7,048 7,240 NOTE.—Data represent estimated official and private holdings of mar- year, and are based on a benchmark survey of holdings as of Jan. 31, 1971, ketable U.S. Treasury securities with an original maturity of more than 1 and monthly transactions reports (see Table 14). 11. SHORT-TERM CLAIMS ON FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES, BY TYPE (Amounts outstanding; in millions of dollars) Payable in dollars Payable in foreign currencies Loans to— Accept- Foreign EEnndd ooff ppeerriioodd Total Collec- ances govt, setions made Deposits curities, Total Official out- for acct. Other Total with for- coml. Other Total institu- Banks i Others 2 stand- of for- eigners and fitions ing eigners nance paper 1971 13,272 12,377 3,969 231 2,080 1,658 2,475 4,254 1,679 895 548 173 174 1 QT) 3 f15,471 14,625 5,674 163 2,975 2,535 3,269 3,204 2,478 846 441 223 182 115,676 14,830 5,671 163 2,970 2,538 3,276 3,226 2,657 846 441 223 182 1973 20,723 20,061 7,660 284 4,538 2,838 4,307 4,160 3,935 662 428 119 115 1974—Sept 34,464 33,546 10,551 528 6,672 3,352 5,245 9,572 8,178 918 468 217 233 Oct 34,647 33,617 10,033 378 6,317 3,338 5,356 10,072 8,155 1,030 547 243 240 Nov 36,833 35,805 10,999 446 7,121 3,433 5,345 10,724 8,737 1,028 515 283 229 Dec 38,913 37,703 11,301 381 7,342 3,579 5,637 11,237 9,527 1,210 668 289 253 1975—Jan 38,977 37,688 10,195 361 6,281 3,553 5,565 11,062 10,866 1,289 719 351 219 Feb 39,772 38,582 10,275 379 6,376 3,521 5,346 11,127 11,833 1,190 609 336 244 Mar 42,186 41,023 9,626 310 5,682 3,633 5,415 11,341 14,641 1,162 626 290 246 Apr 42,806 41,547 10,658 362 6,518 3,778 5,339 11,441 14,109 1,260 764 241 254 May 45,106 44,038 11,862 366 7,648 3,848 5,546 10,951 15,679 1,068 478 301 290 June 45,705 44,481 11,340 494 6,793 4,053 5,345 10,639 17.157 1,224 591 335 299 July 45,542 44,354 11,700 572 6,833 4,295 5,383 10,204 17,068 1,188 608 296 284 Aug.P 45,459 44,296 13,081 626 7,959 4,497 5,314 9,990 15,910 1,163 610 240 313 Sept 45,545 44,418 12,692 572 7,510 4,610 5,314 10,071 16,341 1,127 573 236 319 1 Excludes central banks, which are included with "Official institutions." in reporting coverage. Figures on the first line are comparable in cover- 2 Includes international and regional organizations. age with those shown for the preceding date; figures on the second line 3 Data on the 2 lines shown for this date differ because of changes are comparable with those shown for the following date. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INTL. CAPITAL TRANSACTIONS OF THE U.S. A 67 12. SHORT-TERM CLAIMS ON FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES, BY COUNTRY (End of period. Amounts outstanding; in millions of dollars) 1973 1974 1975 AArreeaa aanndd ccoouunnttrryy Dec. Dec. Jan. Feb. Mar. Apr. May June July Aug.'-1 Sept.'1 Europe: 11 21 18 38 2222 16 19 17 16 28 20 Belgium-Luxembourg 147 384 401 591 550 674 647 600 620 598 536 Denmark 48 46 54 53 41 53 49 64 62 60 46 Finland 108 122 132 136 137 147 137 133 142 143 130 France 621 673 892 893 896 859 723 581 666 740 906 Germany 311 589 390 435 387 399 389 428 482 448 443 Greece 35 64 52 42 46 54 37 37 46 50 54 Italy 316 345 351 277 287 334 329 339 363 336 363 Netherlands 133 348 195 210 187 157 221 219 288 338 313 72 119 115 106 104 114 126 98 91 106 102 Portugal 23 20 16 39 32 26 25 25 27 22 18 Spain 222 196 184 166 150 234 251 235 257 214 245 Sweden 153 180 128 99 72 101 132 115 155 185 i 182 Switzerland 176 335 252 267 230 227 277 252 254 290 214 Turkey 10 15 23 17 19 37 30 40 26 43 56 United Kingdom 1,459 2,441 2,700 2,770 2,896 3.174 3,712 3,476 3.458 4.067 3,724 10 22 38 18 16 28 39 31 36 40 37 Other Western Europe 25 22 22 27 24 31 25 22 22 62 23 U.S.S.R 46 46 44 48 34 51 83 77 80 79 106 Other Eastern Europe 44 131 124 100 110 113 117 118 130 110 110 Total 3,970 6,117 6,130 6,331 6,239 6,831 7,370 6,907 7,222 7,959 7,630 1,955 2,791 2,904 2,643 2,934 2,911 3,096 2,852 2.666 2,355 2,626 Latin America: 499 720 783 808 869 958 1,007 1,111 1,105 1,115 1,219 Bahamas 883 3,398 3,737 4,699 5,926 5,715 6,997 8,658 7,811 6,627 6,467 Brazil 900 1,415 1,264 1,345 1,266 1,299 1,272 1.184 1,390 1,505 1,491 Chile 151 290 303 351 395 433 422 429 472 435 405 397 713 706 679 695 710 702 687 666 667 684 1,373 1,972 1.898 2,006 2,116 2,236 2,380 2.541 2,669 2,755 2,688 Panama 274 503 604 458 546 531 671 527 581 578 721 Peru 178 518 504 531 555 606 590 623 626 646 624 Uruguay 55 63 75 86 104 116 100 85 90 73 54 Venezuela 518 704 795 747 736 757 745 791 902 956 1,109 Other Latin American republics 505 866 899 920 915 967 973 966 1 ,056 1,005 1,014 Netherlands Antilles and Surinam 13 62 45 39 39 36 44 83 62 54 57 Other Latin America 154 1,138 1.438 1,535 1,583 1,722 2,219 1,830 1,679 2,091 1,652 Total 5,900 12,362 13,051 14,202 15,747 16,085 18,122 19,514 19.108 18,509 18,184 Asia: China, People's Rep. of (China Mainland) 31 4 18 65 19 11 12 9 13 13 11 China, Republic of (Taiwan) 140 500 526 473 500 448 434 479 463 503 600 Hong Kong 147 223 203 184 291 210 288 315 201 190 221 India 16 14 19 22 17 21 17 20 23 38 21 Indonesia 88 157 142 159 145 134 119 115 113 88 91 Israel 155 255 271 284 322 299 287 312 362 358 398 Japan 6,398 12,514 11,821 11,246 11,600 11,028 10,603 10,245 10,308 10,292 10,396 Korea 403 955 1,116 1,286 1,356 1,503 1,415 1,523 1,462 1,502 1,515 Philippines 181 372 302 342 353 398 455 478 480 410 340 Thailand 273 458 391 374 406 413 374 441 461 506 474 Middle East oil-exporting countries1.... 330 307 336 369 563 411 418 527 493 624 Other2 392 441 436 445 477 444 555 489 541 572 661 Total 8,224 16,222 15,549 15,216 15,855 15,472 14,969 14,844 14,955 14.966 15,353 Africa: Egypt 35 111 106 114 122 142 138 149 134 141 125 South Africa 129 329 364 396 413 458 475 498 489 492 504 Oil-exporting countries3 115 81 108 108 95 128 120 144 134 189 Other2 224 300 234 235 232 278 276 302 296 347 344 Total 388 855 785 853 875 973 1,018 1,068 1,064 1 ,114 1,162 Other countries: 243 466 433 431 436 428 440 428 446 466 509 All other 43 99 125 95 99 107 89 81 80 88 80 Total 286 565 558 526 535 535 528 509 526 554 589 Total foreign countries 20,723 38,912 38,976 39,771 42,185 42,805 45,104 45,694 45,541 45,456 45,543 International and regional 1 0 1 1 1 1 2 11 1 3 1 20,723 38,913 38,977 39,772 42,186 42,806 45,106 45,705 45,542 45.459 45,545 1 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, made to, and acceptances made for, foreigners; drafts drawn against and United Arab Emirates (Trucial States). foreigners, where collection is being made by banks and bankers for 2 Until Dec. 1974 includes oil-exporting countries. their own account or for account of their customers in the United States; 3 Comprises Algeria, Gabon, Libya, and Nigeria. and foreign currency balances held abroad by banks and bankers and their customers in the United States. Excludes foreign currencies held NOTE.—Short-term claims are principally the following items payable by U.S. monetary authorities. on demand or with a contractual maturity of not more than 1 year: loans Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 68 INTL. CAPITAL TRANSACTIONS OF THE U.S. • NOVEMBER 1975 13. LONG-TERM CLAIMS ON FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES (Amounts outstanding; in millions of dollars) Type Country or area Payable in dollars End of Total Payable period in Total Total Middle Other Other foreign Europe Canada Latin Japan East 3 Asia4 long- curren- America Official Other term cies Total institu- foreign- claims tions 197 2 5,063 4,588 844 430 3,314 435 40 853 406 2,020 353 918 197 3 5,996 5,446 1 ,160 591 3,694 478 72 1 ,272 490 2,116 251 1 ,331 1974—Sept... 6,999 6,386 1,419 853 4,113 542 71 1 ,801 543 2,479 247 1 ,425 Oct... 7.259 6,580 1 ,451 914 4,215 608 71 2,058 523 2,495 267 1 ,399 Nov. . 7.260 6,570 1 ,383 933 4,253 618 72 1,991 506 2,574 260 1 ,395 Dec... 7,156 6,482 1 ,333 931 4,219 609 65 1 ,907 486 2,602 258 384 977 1975— Jan.. . 7,262 6.624 1 ,368 968 4,289 583 54 1 ,992 475 2,603 248 373 1 ,015 Feb... 7,457 6,797 1 ,378 1,035 4,384 606 54 2,096 485 2,675 348 388 967 Mar... 7,554 6,900 1 ,399 1 ,063 4,438 598 55 2,126 485 2,695 247 385 1 ,024 Apr... 7,583 6,915 1 ,239 1 ,110 4,566 605 63 2,188 490 2,786 242 247 1 ,002 May.. 7,870 7,194 1 ,287 1 ,187 4,720 610 66 2,325 476 2,851 254 242 1 ,042 June.. 7,915 7,118 1 ,266 1 ,204 4,648 719 77 2,304 446 2,841 264 241 1 ,135 July. . 8,187 7,320 1 ,280 1 ,290 4,749 792 75 2,323 456 2,985 270 241 1 ,204 Aug.f. 8,251 7,394 1,271 1,336 4,787 787 71 2,390 423 3,006 259 237 1 ,204 Sept.*5. 8,526 7.625 1 ,340 1,354 4.931 809 93 2,424 508 3,121 265 237 1.195 1 Excludes central banks, which are included with "Official institutions." Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates 2 Includes international and regional organizations. (Trucial States). 3 Comprises Middle East oil-exporting countries as follows: Bahrain, 4 Until Dec. 1974 includes Middle East oil-exporting countries. 14. PURCHASES AND SALES BY FOREIGNERS OF LONG-TERM SECURITIES, BY TYPE (In millions of dollars) Marketable U.S. Treas. bonds and notes1 U.S. corporate Foreign bonds3 Foreign stocks3 securities2,3 Net purchases or sales ( —) Period Pur- Net pur- Pur- Net pur- Pur- Net pur- Intl. FFoorreeiiggnn chases Sales chases or chases Sales chases Sales Sales chases or Total and sales ( —) sales ( —) ssaalleess (( ——)) regional Total4 Official Other 1973 305 -165 470 465 6 18,574 13,810 4,764 1 ,474 2,467 -993 1 ,729 1 ,554 176 1974 -472 101 -573 -642 69 16,183 14,677 1,506 1,045 3,284 -2,240 1,903 1,719 183 1975—Jan.-Sept.p 1,532 -63 1,595 1.393 203 14.691 11.607 3.085 1,653 5,596 -3,943 1,145 1 ,380 -234 1974—Sept -115 -81 -33 -60 27 1,478 1,188 291 72 152 -80 146 100 47 Oct 73 35 38 38 1,624 1,511 113 86 362 -276 91 152 — 62 Nov 91 16 76 25 50 1,414 1,518 -104 92 170 -78 124 102 22 Dec 156 -15 171 153 17 1,101 1,246 -145 101 524 -423 117 87 30 1975—Jan 245 118 127 118 9 1,229 900 330 131 1,207 -1,076 147 156 -9 Feb 214 9 205 102 102 1,661 1,403 258 118 554 -436 134 173 -39 Mar 1,171 421 749 724 25 1,755 1,155 600 197 647 -450 148 159 -11 Apr -254 -210 -43 -62 20 1,640 1,397 243 167 341 -174 155 141 14 May 3 -89 92 123 -31 1,845 1,679 166 172 345 -173 145 157 -12 June -240 -326 86 56 31 1,754 1,332 422 215 855 -640 129 143 -15 July 192 95 96 41 56 2,251 1 ,278 973 315 1 ,011 -696 109 115 -6 Aug.33 9 -67 77 117 -40 1,421 1,338 82 158 353 -195 89 256 -167 Sept.*5 192 -14 206 175 31 1 ,134 1 ,124 10 182 284 -102 90 79 11 1 Excludes nonmarketable U.S. Treasury bonds and notes issued to 1975 Middle East Africa official institutions of foreign countries. 2 Includes State and local govt, securities, and securities of U.S. Govt, J an.-Sept. p 110 agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments Jan. 100 abroad. Feb. 209 3 Includes transactions of international and regional organizations. Mar. 525 4 Includes transactions (in millions of dollars) of oil-exporting countries Apr. 50 10 in Middle East and Africa as shown in the tabulation in the opposite May 1 17 0 5 6 20 column: June 1 '26' J A u u ly g .p 80 10 Sept.*' 150 50 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INTL. CAPITAL TRANSACTIONS OF THE U.S. A 69 15. NET PURCHASES OR SALES BY FOREIGNERS OF U.S. CORPORATE STOCKS, BY COUNTRY (In millions of dollars) 1 Pur- Net pur- Ger- Nether- Switzer- United Total Total Middle Other Period chases Sales chases or France mmaannyy lands land King- EEuurrooppee Canada America East1 Asia2 Other: sales (—) dom Latin 1973 12,767 9,978 2,790 439 2 339 686 366 2,104 99 4 577 5 1974 7,634 7,095 540 203 39 330 36 -377 228811 -6 —— 3333 288 10 1975—Jan.-Sept.p 11 . 132 8.008 3,124 195 170 283 697 446 11 ..888866 159 11 950 96 27 1974—Sept 460 445 15 -9 17 21 -6 -38 -19 6 4 23 1 Oct 673 695 -22 17 --3300 9 -39 -82 -115 3 2 95 -8 Nov 604 616 -13 5 11 _2 -35 -51 -77 -2 -5 70 1 Dec 450 429 21 13 13 20 -10 -76 -30 14 10 27 1975—Jan 731 541 190 34 15 8 42 -8 107 12 -15 86 -2 2 Feb.. 1 ,383 849 533 21 25 14 115 147 331 20 18 153 -3 15 Mar 1 ,148 913 236 12 11 40 39 38 146 15 -5 85 -5 -1 Apr 1,318 1 ,058 259 -15 23 26 44 54 136 -5 2 119 2 3 May 1 ,527 1 ,149 378 -6 4 27 100 59 193 36 1 113 36 -1 June 1 ,321 1 ,063 258 32 1 19 71 36 152 21 8 87 9 -19 July 1 ,669 1 ,080 589 55 31 80 139 74 396 20 13 153 2 5 Aug.*' 1 ,153 712 441 52 52 47 83 38 302 21 -6 82 27 16 Sept.p. . .. 882 642 240 10 7 22 64 7 123 20 -15 72 32 7 1 Comprises Middle East oil-exporting countries as follows: Bahrain, 2 Until 1975 includes Middle East oil-exporting countries. Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates 3 Includes international and regional organizations. (Trucial States). 16. NET PURCHASES OR SALES BY FOREIGNERS OF U.S. CORPORATE BONDS, BY COUNTRY (In millions of dollars) Ger- Nether- Switzer- United Total Total Middle Other Total Other Intl. and Period Total France many lands land Kingdom Europe Canada Latin East1 Asia2 Africa countries regional America 197 3 1 ,948 201 -33 -19 307 275 1 ,204 49 44 588 * 10 52 197 4 952 96 27 183 96 329 672 50 43 632 8 10 -455 1975—Jan.-Sept.p -38 39 27 55 88 -268 - 106 85 7 1 .013 -30 * 1 -1 ,008 1974—Sep t 276 1 1 -1 2 64 65 4 2 60 * 145 Oct 135 10 * -1 13 6 24 18 5 100 * * -11 Nov. . . . -92 4 -2 2 -1 -9 -13 6 1 399 * * -483 Dec -166 1 * -4 1 64 66 -4 17 93 * * -337 1975—Ja n 140 2 3 * 6 59 94 14 -1 151 1 * * -120 Feb -275 -4 3 * 3 -91 -87 16 * 35 I * 1 -241 Mar.. . 365 1 -1 -1 10 23 32 4 -4 341 -19 * * 10 Apr -16 1 2 -26 35 -99 -100 5 3 80 1 * * -6 May.. . . -212 3 1 -1 7 -81 -72 7 1 81 -11 * * -6 June.. . . 164 9 * 8 5 32 58 4 * 65 -1 * * -218 July. . . . 384 27 16 6 35 80 183 33 1 179 4 * * -17 Aug.*... -358 13 -3 -18 -6 -69 -73 6 1 -1 1 * * -292 Sept.33. . -229 -13 6 25 -7 -122 -142 -5 5 82 -7 * * -162 1 See note 1 to Table 15. NOTE.—Statistics include State and local govt, securities, and securities 2 See note 2 to Table 15. of U.S. Govt, agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments abroad. 17. NET PURCHASES OR SALES BY FOREIGNERS OF 18. FOREIGN CREDIT AND DEBIT LONG-TERM FOREIGN SECURITIES, BY AREA BALANCES IN BROKERAGE ACCOUNTS (In millions of dollars) (Amounts outstanding; in millions of dollars) Intl. Total Latin Other Credit Debit Period Total and foreign Eu- Canada Amer- Asia Af- coun- End of balances balances re- coun- rrooppee ica rica tries period (due to (due from gional tries foreigners) foreigners) 1973 -818 139 -957 -141 -569 -120 -168 3 37 1972—Sept 286 336 1974 -2,056 -60 -1,997 -546 -1,529 -93 142 7 22 372 405 1975— 1973—Mar 310 364 Jan.-Sept.^ -4,178 -1,341 -2,837 -144 - 1.839 -274 -488 21 -113 316 243 290 255 1974—Sept.. .. -34 12 -46 -41 -37 5 23 1 3 333 231 Oct . -338 2 -340 -81 -244 * -16 -1 2 Nov... . -56 3 -59 -21 -8 -14 -21 2 3 1974—Mar 383 225 Dec.. . . -393 -95 -298 -27 -190 -25 -67 12 * 354 241 298 178 1975—Jan , -1,085 -572 -514 -41 -405 -28 -60 20 * Dec p 293 193 Feb.. . . -475 -147 -328 19 -159 -97 -94 2 * Mar— -462 -106 -356 -66 -175 -3 -112 -2 1 1975—Mar.2' 349 209 Apr.. .. -160 -57 -103 -57 -6 17 -59 * 2 May. . . -185 31 -216 39 -168 * -88 -2 2 June... -655 * -655 -22 -478 * -30 2 -127 NOTE.—Data represent the money credit balances and July.... -702 -475 -227 -22 -116 -25 -69 * 4 money debit balances appearing on the books of reporting Aug.f. . -362 -21 -341 24 -204 -164 1 1 2 brokers and dealers in the United States, in accounts of Sept.p. . -91 6 -97 -19 -128 25 24 -1 1 foreigners with them, and in their accounts carried by foreigners. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 70 INTL. CAPITAL TRANSACTIONS OF THE U.S. • NOVEMBER 1975 19a. ASSETS OF FOREIGN BRANCHES OF U.S. BANKS (In millions of dollars) Claims on U.S. Claims on foreigners Location and currency form Month-end Total Other Offi- Non- Total Parent Other Total branches Other cial bank bank of parent banks insti- forbank tutions eigners IN ALL FOREIGN COUNTRIES Total, all currencies 1972--Dec 78,202 4,678 2,113 2,565 71,304 11.504 35,773 1,594 22,432 1973- 121,866 5,091 1,886 3,205 111,974 19,177 56.368 2,693 33,736 1974--Aug 148,719 9,366 6,868 2,498 133,473 26,428 60,524 3,423 43,098 Sept 147,720 6,267 3,622 2,645 135,272 26,322 61,301 3,721 43,927 Oct 145,906 4,661 2,027 2,634 135,284 26,958 59,617 3,849 44,860 Nov 150,274 7,751 5,159 2,592 136,442 28,366 58,727 4,019 45,330 Dec 151,905 6,898 4,464 2,434 138,713 27,559 60,283 4,077 46,795 1975- 151,140 7,029 4,360 2,669 138,143 27,894 58,863 4,152 47,234 Feb 151,662 5,486 2,882 2,604 140,345 28,969 58,794 4,246 48,335 155,204 5,326 2,638 2,688 143,750 28,330 61,611 4,407 49,402 155,616 5,831 3,052 2,779 143,949 29,195 60,292 4,353 50,109 156,909 7,725 4,889 2,837 143,101 27.581 60,330 4,494 50,697 162.341 5,538 2.342 3.196 150.516 30.870 63.710 4,836 51.101 July 160.701 5.915 2.785 3.129 148.225 30.153 62.438 4.796 50.839 Aug.f 165.484 8.749 5.696 3,053 150.197 31 .278 62,460 4.892 51.567 Payable in U.S. dollars. 1972--Dec 52,636 4,419 2,091 2,327 47,444 7,869 26,251 1,059 12,264 1973--Dec 79,445 4,599 1,848 2,751 73,018 12,799 39,527 1,777 18,915 1974- 105,827 9,055 6,816 2,239 93,893 19,694 45,681 2,780 25,738 Sept 104.345 5,990 3,564 2,426 95,304 19,413 46,517 2,873 26,501 Oct 101,977 4,379 1 ,970 2,409 94,650 19,785 44,832 ' 3,006 27,027 105,066 7,445 5,105 2,340 94,581 20,623 43,741 3,192 27,026 Dec 105,969 6,602 4,428 2,174 96,210 19,688 45,067 3,289 28,166 1975- 105,776 6,706 4,318 2,387 95,989 20,448 43,151 3,370 29,020 Feb 104,360 5,141 2,839 2,302 96,327 20,827 42,672 3,431 29,397 107,519 5,012 2,607 2,405 99,637 19.836 46,118 3,604 30,079 108,399 5,466 3,009 2,456 100,231 20,993 45,172 3,599 30,467 111,637 7,316 4,824 2,491 101,384 21.281 45,403 3,685 31,016 117,295 5,111 2,280 2,832 109,181 24,529 49,132 3,949 31,571 July 117,265 5,508 2,734 2,774 108,281 24,180 48,572 3,929 31,600 Aug.-'-' 121.127 8.425 5.642 2.783 109.425 25,071 48.063 4,148 32.143 IN UNITED KINGDOM Total, all currencies 1972-—Dec 43,467 2,234 1,138 1,096 40,214 5,659 23,842 606 10,106 1973--Dec 61.732 1,789 738 1,051 57,761 8,773 34,442 735 13,811 1974- 70,382 3,599 2,858 741 64,496 12,790 33,942 666 17,097 70,965 2,860 2,087 774 65,596 12,436 34,959 829 17,372 Oct 68,123 1,325 502 823 64,462 12,386 33,608 887 17,581 69,137 3,387 2,568 818 63.571 13,122 32,128 753 17,567 69,804 3,248 2,472 776 64,111 12,724 32,701 788 17,898 1975- 68,451 2,633 1,902 731 63,527 12,873 32,057 854 17,743 Feb 67,038 1,818 1,023 796 63,250 13,246 31,641 848 17,515 69,654 1 ,798 982 817 65,693 12,806 34,260 929 17,699 69,248 2,017 1 ,126 891 65,330 13,314 33,079 919 18,018 68,707 2,535 1,689 845 64,269 12,491 32,443 920 18,415 70,751 1,834 641 1,192 66,868 13,765 34,634 948 17,522 July 70,382 1 ,904 807 1 ,097 66,277 14,414 33,431 923 17,509 Aug.'J 72.455 3,795 2,698 1 .097 66,428 15,213 32.998 948 17,268 Payable in U.S. dollars. 1972-—Dec 30,257 2.146 1,131 1,015 27,664 4,326 17,331 543 5,464 1973--Dec 40,323 1,642 730 912 37,816 6,509 23,389 510 7,409 1974--Aug 49,406 3,507 2,847 660 44,677 10,529 23,948 563 9,637 Sept 50,075 2,774 2,067 708 45,960 10,305 25,044 676 9,937 Oct 47,968 1,235 479 756 45,421 10,234 24,499 734 9,954 48,710 3,277 2,546 730 44,198 10,796 22,936 615 9,852 Dec 49,211 3,146 2,468 678 44,693 10,265 23,716 610 10,102 1975- 47,769 2,542 1,892 650 43,959 10,421 22,610 661 10,268 Feb 46,019 1,697 1,017 680 43,244 10,615 21,918 657 10,055 48,939 1,687 974 713 46,039 10,373 24,874 736 10,057 48,797 1,885 1,109 776 45,923 10,995 23,990 721 10,217 May 48,506 2,404 1,671 733 45,180 10,656 23,320 698 10,506 51,365 1,669 623 1,045 48,713 12,054 25,761 721 10,178 July 51,665 1 ,742 793 949 48,787 12,664 25,143 713 10,267 53.456 3,661 2,681 980 48.763 13,315 24,540 740 10,168 IN BAHAMAS AND CAYMANS1 Total, all currencies 1972--Dec 12,642 1,486 214 1,272 10,986 725 5,507 431 4,322 1973--Dec 23,771 2,210 317 1,893 21,041 1,928 9,895 1,151 8,068 1974- 32,317 4,624 3,153 1,471 26,914 3,056 11,488 1,612 10,757 Sept 30,080 2,315 750 1,564 26,910 2,770 11,515 1,728 10,896 30,071 2,206 711 1,495 27,075 3,178 11,347 1,756 10,795 32,313 3,299 1,816 1,484 28,130 3,829 11,371 1,993 10,937 Dec 31,733 2,463 1,081 1,382 28,455 3,478 11,354 2,022 11,601 1975- 33,131 3,223 1,594 1,629 29,070 3,644 11,194 2,027 12,206 33,534 2,563 1,072 1,491 30,137 3,855 11,474 2,060 12,748 33,793 2,405 839 1,567 30,671 3,568 11,634 2,393 13,077 35,666 2,587 1,006 1,581 32,359 4,320 12,229 2,419 13,392 38,198 4,125 2,468 1,657 33,215 4,270 13,181 2,531 13,233 39,645 2,632 987 1,645 36,182 5,831 13,747 2,772 13,832 July 39,611 2,783 1 ,131 1 ,652 35,678 5,015 14,065 2,747 13,851 241,273 3,764 2,228 1,536 36,556 5,222 14,117 2,891 14,326 Digitized for FRASER For notes see p. A-74. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INTL. CAPITAL TRANSACTIONS OF THE U.S. A 71 19b. LIABILITIES OF FOREIGN BRANCHES OF U.S. BANKS (In millions of dollars) To U.S. To foreigners Other Offi- Non- Month-end Location and currency form Total Parent Other Total branches Other cial bank bank of parent banks insti- forbank tutions eigners IN ALL FOREIGN COUNTRIES 3,501 997 2,504 72,121 11,121 41,218 8,351 11,432 2,580 . 1972—Dec. . .. Total, all currencies 5,610 1,642 3,968 111,615 18.213 65,389 10,330 17,683 4,641 . 1973—Dec. 9,419 4,123 5,296 132.774 26,007 68,772 16,304 21,690 6,527 . 1974—Aug. 9,981 5,058 4,923 131,016 26,337 66,071 17,488 21,121 6,723 Sept. 10,449 5,853 4,596 128,910 26,619 62,606 18,171 21,514 6,548 Oct. 11,901 6,249 5,652 131,619 27,717 63,596 19,979 20,327 6,755 Nov. 11,982 5,809 6,173 132,990 26,941 65,675 20,185 20,189 6,933 Dec. 11,831 6,356 5,476 132.775 27,019 64,147 21,683 19,926 6,533 . 1975—Jan. 12,561 6,607 5,954 132,594 28,185 63,402 21,951 19,057 6,507 Feb. 15,407 8,849 6,557 133,540 28.214 63,419 22,577 19,330 6,257 Mar. 14,936 8,703 6,233 134,594 29,192 62,287 23,236 19,879 6,C~~ Apr. 16,860 10,366 6,494 133,806 26,725 64.700 22,223 20,158 6,243 May 18,617 12,204 6,414 137,189 30,412 64.955 21.106 20,715 6,535 June' 17,701 11,539 6,162 136,808 30.233 65.956 20,371 20,249 6,191 July' 16,830 9,670 7,160 142,329 30,582 70,162 21.093 20,492 6.326 Aug.P 3,050 847 2,202 50,406 7,955 29,229 6,781 6,441 1,422 . 1972—Dec. .Payable in U.S. dollars 5,027 1,477 3,550 73,189 12,554 43,641 7,491 9,50 2,158 . 1973—Dec. 8,786 3,932 4,853 94,178 19,456 48,394 13,508 12,821 3,945 . 1974—Aug. 9,294 4,833 4,461 92,630 19,599 46,020 14,533 12,478 4,080 Sept. 9,905 5,650 4,255 90,136 19,481 42,690 15,076 12,889 3,893 Oct. 11,215 6,023 5,192 92,233 20,242 43,147 16,789 12.054 3,979 Nov. 11,437 5,641 5,795 92,503 19,330 43,656 17,444 12,072 3,951 Dec. 11,368 6,204 5,164 93,044 19,999 42,854 18,343 11,848 3,778 . 1975—Jan. 12,063 6,460 5,603 90,426 20,109 40.701 18,708 10,907 3,636 Feb. 14,795 8,660 6,135 91,338 19,880 41,216 19,303 10,939 3,368 Mar. 14,280 8,520 5,760 92,712 20,683 40,996 19,909 11,123 3,414 Apr. 16,259 10,192 6,067 94,449 20,521 43,860 18,928 11,139 3,397 May 18,000 12,011 5,990 97,825 23,969 44,199 17,968 '11 3,560 June 17,090 11,335 5,755 99,010 24,112 45,894 17,393 11,611 3,216 July' 16.188 9.492 6,696 103,986 24.435 49,416 18,080 12.055 3,381 AugJ IN UNITED KINGDOM 1,453 113 1 ,340 41,020 2.961 24,596 6,433 7,030 994 .1972—Dec. .. .Total, all currencies 2,431 136 2,295 57.311 3,944 34,979 8,140 10,248 1,990 .1973—Dec. 3,701 713 2,' 64,309 4,794 33,920 12,737 12,858 2,373 .1974—Aug. 3,503 635 2,867 64,919 5,428 33,766 13,544 12,181 2,543 Sept. 3,227 683 2,544 62,621 5,237 30,621 14,051 12,712 2,275 Oct. 4,376 889 3,487 62,397 5.071 30,352 15,454 11,521 2,363 Nov. 3,978 510 3,468 63,409 4,762 32,040 15,258 11,349 2,418 Dec. 3.804 873 2,931 62,360 4,567 30,266 16,419 11 ,108 2,287 .1975--Jan. 4,376 913 3,462 60,546 4,693 29,207 16,517 10,127 2,117 .Feb. 5,095 1,224 3,871 62,363 4,630 29,990 17,305 10,438 2,196 . Mar. 4,596 1,342 3,254 62,625 5,394 28,666 17,812 10,753 2,026 .Apr. 4,772 1,337 3,435 61,772 5,325 28,957 16,726 10,764 2,164 .May 4,668 1,451 3,217 63,857 7,030 30,030 15,524 11,274 2,226 June 4,679 1 ,718 2,961 63,501 6,475 30,636 15,312 11,077 2,203 .July 5,251 1,904 3,348 65,012 6.260 32,097 15,617 11,038 2,194 . Aug.<p 1,272 72 1,200 29,002 2,008 17,379 5,329 4,287 535 1972—Dec. .. .Payable in U.S. dollars 2,173 113 2,060 36,646 2,519 22,051 5,923 6,152 870 1973—Dec. 3,448 692 2,756 44,654 3,278 22,558 10,437 8,382 1,380 .1974—Aug. 3,177 605 2,572 45,550 3,667 22,818 11,035 8,030 1,486 Sept. 2,r~ 651 2,337 44,033 3,690 20,203 11,444 8,696 1,294 Oct. 4,037 865 3.172 44,256 3,557 20,200 12,r"" 7,691 1,375 Nov. 3,744 484 3,261 44,594 3,256 20,526 13,225 7,587 1,328 Dec. 3,599 854 2,744 43,578 3,172 19,061 13,736 7,609 1,313 .1975—Jan. 4,164 895 3,269 41,350 3,266 17,673 13,932 6,479 1,184 Feb. 4.805 1,189 3,616 43,546 3.072 19,128 14,688 6,658 1,183 Mar. 4,297 1 ,313 2,984 43,758 3,886 17,997 15,158 6,717 1 ,122 Apr. 4,487 1,314 3.173 43,784 4,220 18,640 14,135 6,789 1,208 May 4,369 1,412 2,957 46.312 5.962 20,039 13,083 7,228 1,167 June 4,421 1,684 2,737 46,217 5,478 20,775 12,915 7,049 1,1" July 4,975 1,873 3,103 47,912 5,288 22,087 13,249 7,287 1,129 Aug.f IN BAHAMAS AND CAYMANS 1 1,220 312 908 11,260 1,818 7,875 230 1,338 163 . 1972—Dec. ... Total, all currencies 1,573 307 1,266 21,747 5,508 14,071 492 1,676 451 . 1973—Dec. 2,909 1,123 1,786 28,670 8,079 16,688 1,715 2,188 738 . . .. 1974—Aug. 3,721 2,151 1,571 25,626 7,072 14,419 1,840 2,295 733 Sept. 4,311 2,706 1,605 24,995 7,211 13,669 1,980 2,135 765 Oct. 4,426 2,699 1,727 27,107 8,538 14,132 2,296 2,141 779 Nov. 4,815 2,636 2,180 26,140 7,702 14,050 2,377 2,011 778 Dec. 5,036 2,926 2,111 27,343 8,269 14,259 2,595 2,220 752 . 1975—Jan. 5,243 3,281 1,962 27,498 8,975 13,550 2,711 2,262 793 Feb. 7,228 5,081 2,147 25,875 8,498 12,614 2,520 2,243 690 Mar. 7,420 5,083 2,337 27,536 8,756 13,694 2,769 2,318 711 Apr. 9,090 6,766 2,324 28,309 6,872 16,018 2,977 2,441 799 May 10,866 8,322 2,544 27,987 8,075 14,482 3,036 2,393 793 June 9,r~ 7,404 2,584 28,933 8,401 15,539 2,500 2,492 690 July 8,449 5,364 3,085 31,913 9,128 17,317 2,860 2,607 911 Aug.?5 Digitized for FRASER For notes see p. A-74. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 72 INTL. CAPITAL TRANSACTIONS OF THE U.S. • NOVEMBER 1975 20. DEPOSITS, U.S. TREAS. SECURITIES, 21. SHORT-TERM LIQUID CLAIMS ON FOREIGNERS AND GOLD HELD AT F.R. BANKS FOR REPORTED BY NONBANKING CONCERNS FOREIGN OFFICIAL ACCOUNT (Amounts outstanding; in millions of dollars) (In millions of dollars) Payable in Payable in dollars foreign currencies Assets in custody End of EEnndd ooff UUnniitteedd period Deposits U se . c S u . r T it r i e e a s1 s . Ear g m o a ld rk ed ppeerriioodd TToottaall Deposits i S n t h e v o r e m r s t t - - Deposits i S n t h e v o r e m r s t t - - KK dd ii oo nn mm gg -- CCaannaaddaa ments 1 ments1 1972. 325 50,934 215,530 1973. 251 52,070 217,068 1971 1,507 1,078 127 234 68 580 443 1974. 418 55,600 16,838 1974—Oct.., 376 54,691 16,875 19722 \ / 2 1 , , 3 9 7 6 4 5 1 1 , , 4 9 4 1 6 0 1 5 6 5 9 3 3 0 4 7 0 4 6 2 8 9 7 1 0 1 2 4 5 8 3 5 6 Nov.. 626 55,908 16,865 1973 3,162 2,588 37 427 109 1,118 770 Dec.. 418 55,600 16,838 1 974—Aug 3,504 2,941 51 369 144 1 ,436 872 1975—Jan... 391 58,001 16,837 Sept . , , 3,073 2,491 30 362 189 1 ,194 864 Feb. , 409 60,864 16.818 Oct 2,698 2,132 25 325 216 1,122 835 Mar., 402 60,729 16,818 Nov 2,998 2,380 15 326 277 1,285 941 Apr.. 270 60,618 16,818 Dec 3,303 2,582 56 403 261 1,342 951 May, 310 61.539 16.818 June. 373 61,406 16,803 1975—Jan.' 3.230 2,521 50 314 345 1 . 136 1.117 July.. 369 60,999 16,803 Feb.r. . . . 3.329 2,515 52 356 406 1 ,079 1 .136 Aug. 342 60,120 16,803 Mar.' .... 3.238 2.434 67 350 388 1 .055 1.134 Sept. 324 58.420 16.795 Apr.''.... 3.368 2,458 48 314 550 1 .065 1 .279 Oct.. 230 60,132 16.751 Mayr. . .. 3.188 2,220 47 393 527 908 1 ,240 Juner.. . . 3.138 2,241 95 369 433 974 1 .128 1 Marketable U.S. Treasury bills, certificates of in- J A u u l g y . r 'J 3 3 . ,2 4 2 3 1 8 2 2. . 2 3 7 3 8 4 1 1 2 1 9 8 4 4 5 2 3 0 4 5 0 2 5 2 1 9 .0 0 1 4 7 1 1 . , 3 1 0 0 9 9 debtedness, notes, and bonds and nonmarketable U.S. Treasury securities payable in dollars and in foreign cur 2 r e T n h c e i e v s. a lue of earmarked gold increased because of the or 1 h a N v e in g g o ti a a b c l o e n t a r n a d c tu o a th l e m r a r t e u a r d i i t l y y o t f r a n n o s t f e m ra o b re le t h f a o n r ei 1 g n y e o ar b l f i r g o a m ti o t n h s e p d a a y te a b o l n e o w n h ic d h e m th a e n d changes in par value of the U.S. dollar in May 1972, and obligation was incurred by the foreigner. in Oct. 1973. 2 Data on the 2 lines for this date differ because of changes in reporting coverage. Figures on the first line are comparable in coverage with those shown for the preceding NOTE.—Excludes deposits and U.S. Treasury securities date; figures on the second line are comparable with those shown for the following date. held for international and regional organizations. Earmarked gold is gold held for foreign and international NOTE.—Data represent the liquid assets abroad of large nonbanking concerns in accounts and is not included in the gold stock of the the United States. They are a portion of the total claims on foreigners reported by United States. nonbanking concerns in the United States and are included in the figures shown in Table 22. 22. SHORT-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS REPORTED BY NONBANKING CONCERNS, BY TYPE (Amount outstanding; in millions of dollars) Liabilities Claims Payable in foreign currencies End of period Payable Payable Payable Total in in Total in dollars foreign dollars Deposits with currencies banks abroad Other in reporter's name 1Q71 Fic- 1 / 2,704 2,229 475 5,185 4,535 318 333 1 2,763 2,301 463 5,000 /i, 467 289 244 1972—Mar 2,844 2,407 437 5,173 4,557 317 300 June 2,925 2,452 472 5,326 4,685 374 268 Sept 2,933 2,435 498 5,487 4,833 426 228 i / 3,119 2,635 484 5,721 5,074 410 237 \ 3,399 2,921 478 6,312 5,645 393 274 1973—Mar 3,307 2,828 478 7,028 6,150 456 422 June 3,286 2,754 532 7,304 6.453 493 358 Sept 3,574 2,915 659 7,648 6J10 528 411 Dec 3,962 3,249 713 8,438 7,522 485 431 1974—Mar 4,382 3,563 819 10,407 9,465 400 542 June 5,133 4,168 965 10,965 10,030 420 516 Sept 5,600 4,646 954 10,632 9,656 419 558 Dec 5,766 4,851 915 11,170 10,125 455 590 1975—Mar 5,732 4.866 866 10,833 9.744 397 692 June^ 5,954 4.931 1,023 10,784 9,546 422 816 1 Data on the 2 lines shown for this date differ preceding date; figures on the second line are compabecause of changes in reporting coverage. Figures on rable with those shown for the following date. the first line are comparable with those shown for the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • INTL. CAPITAL TRANSACTIONS OF THE U.S. A 73 23. SHORT-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS REPORTED BY NONBANKING CONCERNS (End of period. Amounts outstanding; in millions of dollars) Liabilities to foreigners Claims on foreigners Area and country 1974 1975 1974 1975 June Sept. Dec. Mar. June3' June Sept. Dec. Mar. June'1 Europe : Austria 12 18 20 26 22 17 15 26 15 13 Belgium-Luxembourg 417 500 515 471 334 139 114 128 102 96 Denmark 18 22 24 23 14 27 25 42 35 22 Finland 9 12 16 16 12 80 91 120 77 87 France 177 164 202 151 138 511 463 431 328 287 Germany 220 246 314 350 466 348 328 339 276 346 Greece 28 28 39 25 27 76 69 65 59 69 Italy 131 137 128 109 110 395 415 397 309 300 Netherlands 104 120 117 121 141 126 144 148 157 135 Norway 8 10 9 9 8 35 32 36 35 41 Portugal 17 20 19 13 13 101 69 81 42 32 Spain 45 48 56 54 59 409 414 369 359 324 Sweden 52 40 38 32 30 106 97 89 66 74 Switzerland 112 106 140 157 170 78 154 136 86 1 13 Turkey 11 20 8 12 14 28 24 26 33 28 United Kingdom 1,244 1,415 1,216 1 ,109 1 .006 1 .871 1 ,768 1 .853 1 ,633 1 .534 Yugoslavia 18 17 40 52 45 23 23 22 33 32 Other Western Europe 6 7 5 5 4 23 20 21 23 16 Eastern Europe 34 80 70 54 49 97 90 142 1 14 154 Total 2,662 3,010 2,976 2.789 2.664 4.491 4,355 4,471 3.780 3,704 Canada 312 298 298 258 274 1 .577 1 .570 1 .615 I ,860 1,950 Latin America: Argentina 19 28 36 31 30 53 59 69 76 65 Bahamas 307 325 281 299 279 977 518 594 615 630 Brazil 125 160 118 121 127 523 419 461 376 349 Chile 10 14 22 23 15 64 124 106 69 57 Colombia 22 13 14 11 11 51 49 51 51 47 Cuba * * * * * 1 1 1 1 1 Mexico 76 64 63 72 74 263 287 297 325 307 Panama 19 21 28 18 27 84 114 132 1 10 128 Peru 11 15 14 18 16 60 40 44 46 50 Uruguay 2 2 2 3 3 5 6 5 15 5 Venezuela 43 53 49 39 44 172 190 190 180 166 Other L.A. republics 60 63 83 65 67 172 182 193 195 180 Neth. Antilles and Surinam 7 8 24 48 52 17 14 20 16 13 Other Latin America 59 50 81 114 144 157 169 147 196 159 Total 761 818 816 862 889 2,599 2, 169 2,308 2,271 2,155 Asia: China, People's Republic of (China Mainland) 39 23 17 8 6 3 8 17 19 32 China, Rep. of (Taiwan) 72 72 93 102 100 118 127 137 121 125 Hong Kong 19 19 19 19 30 68 64 63 83 85 India 13 10 7 10 21 31 37 37 32 39 Indonesia 22 38 60 63 87 67 81 85 110 142 Israel 39 40 50 62 62 37 53 44 46 60 Japan 374 352 348 327 274 957 1,100 1,148 1,307 1,224 Korea 45 66 75 47 43 124 123 201 165 178 Philippines 19 28 25 19 17 86 108 93 82 91 Thailand 7 10 10 9 6 22 23 24 30 25 Other Asia 404 431 536 645 845 314 311 387 398 469 Total 1,054 1,089 1,239 1,312 1,492 1,827 2,034 2,237 2,392 2,471 Africa: Egypt 12 6 3 5 34 13 16 15 24 15 South Africa 24 35 43 • 54 65 85 90 101 104 102 Zaire 15 17 18 17 9 17 13 24 18 17 Other Africa 156 114 129 142 215 199 205 234 242 227 Total 206 172 193 217 323 314 325 374 387 362 Other countries: Australia 51 57 56 60 37 117 134 116 97 101 All other 24 32 30 31 18 39 44 49 44 39 Total 74 89 86 91 55 157 178 165 141 141 International and regional 63 125 159 201 257 1 1 * 1 Grand total 5,133 5,600 5,766 5,732 5,954 10,965 10,632 11,170 10,833 10,784 NOTE.—Reported by exporters, importers, and industrial and com- Data exclude claims held through U.S. banks, and intercompany accounts mercial concerns and other nonbanking institutions in the United States. between U.S. companies and their foreign affiliates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 74 INTL. CAPITAL TRANSACTIONS OF THE U.S. • NOVEMBER 1975 24. LONG-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS REPORTED BY NONBANKING CONCERNS (Amounts outstanding; in millions of dollars) Claims EEEnnnddd ooofff pppeeerrriiioooddd TTToootttaaalll Country or area llliiiaaabbbiiillliiitttiiieeesss TToottaall K U in n g it d e o d m E O u t r h o e p r e Canada Brazil Mexico A O L m a t e h t r i e i n r c a Japan O A t s h i e a r Africa o A th l e l r 1971—June 3,172 2,982 151 687 677 180 63 625 138 312 75 74 Sept 2,939 3,019 135 672 765 178 60 597 133 319 85 75 D 6 1 [ 1 3 3 , , 1 1 5 3 9 8 3 3 , , 0 1 6 1 8 8 1 1 2 2 8 8 7 7 0 0 5 4 7 7 6 1 1 7 1 1 7 7 4 4 6 6 0 0 6 6 5 5 2 3 1 1 4 3 1 6 3 3 2 2 7 5 8 8 6 6 8 8 5 4 1972—June 3,300 3.206 108 712 748 188 61 671 161 377 86 93 Sept 3,448 3,187 128 695 757 177 63 662 132 390 89 96 D c 1 / 1 3 3 , , 5 5 4 9 0 2 3 3, , 3 2 1 8 2 4 1 1 9 6 1 3 7 7 4 1 5 5 7 7 5 7 9 5 1 1 8 8 7 4 6 6 0 4 6 7 5 0 8 3 1 1 3 5 3 6 4 3 0 7 6 8 8 8 7 6 1 3 0 8 9 1973—Mar 3,770 3,421 156 802 775 165 63 796 123 393 105 45 June 3,771 3,472 180 805 782 146 65 825 124 390 108 48 Sept 3,979 3,632 216 822 800 147 73 832 134 449 108 51 Dec 3,867 3,695 290 763 854 145 79 824 122 450 115 53 1974—Mar 3,816 3,813 368 737 888 194 81 800 118 448 119 61 June 3,514 3,809 363 696 907 184 138 742 117 477 122 61 Sept 3,340 3,932 370 702 943 181 145 776 114 523 118 59 Dec 3,677 4,112 364 640 975 187 143 1 ,018 107 505 121 54 1975—Mar 3,954 4,128 340 652 1 ,020 182 160 961 102 527 130 54 Junef 4,072 4,073 299 631 1,029 181 154 939 98 536 138 68 1 Data on the 2 lines shown for this date differ because of changes shown for the preceding date; figures on the second line are comparable in reporting coverage. Figures on the first line are comparable with those with those shown for the following date. 25. OPEN MARKET RATES (Per cent per annum) Germany, Switzer- Canada United Kingdom France Fed. Rep. of Netherlands land Month Treasury Day-to- Prime Treasury Day-to- Clearing Day-to- Treasury Day-to- Treasury Day-to- Private bills, day bank bills, day banks' day bills, day bills, day discount 3 months1 money2 bills, 3 months money deposit money 3 60-90 money 5 3 months money rate 3 months rates days4 1973 5.43 5.27 10.45 9.40 8.27 7.96 8.92 6.40 10.18 4.07 4.94 5.09 1974 7.63 7.69 12.99 11.36 9.85 9.48 12.87 6.06 8.76 6.90 8.21 6.67 1974—Oct 8.67 8.56 11.95 10.93 10.81 9.50 13.06 5.63 8.88 7.38 7.81 7.00 Nov 7.84 7.86 12.07 10.98 7.70 9.50 12.40 5.63 7.20 6.72 7.00 7.00 Dec 7.29 7.44 12.91 10.99 7.23 9.50 11.88 5. 13 8.25 6.69 6.96 7.00 1975—Jan 6.65 6.82 11.93 10.59 8.40 9.30 11.20 5.13 7.54 6.60 6.18 7.00 Feb 6.34 6.88 11.34 9.88 7.72 9.50 9.91 3.88 4.04 6.56 7.33 7.00 Mar 6.29 6.73 10.11 9.49 7.53 8.22 9.06 3.38 4.87 5.94 5.87 7.00 Apr 6.59 6.68 9.41 9.26 7.50 7.09 8.34 3.38 4.62 5.53 4.13 6.50 May 6.89 6.88 10.00 9.47 7.81 6.25 7.56 3.38 5.32 3.82 1 .98 6.50 June 6.96 6.88 9.72 9.43 7.00 6.25 7.31 3.38 4.91 2.78 1 .37 6.50 July 7.22 7.17 9.86 9.71 7.34 6.25 7.25 3.38 3.98 2.98 1 .99 6.50 Aug 7.72 7.42 10.59 10.43 8.59 6.43 7.16 3.38 1 .93 2.90 1.51 6.00 Sept 88..3377 77..7744 10.43 10.36 9.40 6.50 6.91 4.25 22..6600 00..9944 5.50 Oct 1111..3388 1111..4422 9.88 66..9933 66..5533 33..2277 55..5500 1 Based on average yield of weekly tenders during month. 5 Monthly averages based on daily quotations. 2 Based on weekly averages of daily closing rates. 3 Rate shown is on private securities. NOTE.—For description and back data, see "International Finance," 4 Rate in effect at end of month. Section 15 of Supplement to Banking and Monetary Statistics, 1962. NOTES TO TABLES 19a AND 19b ON PAGES A-70 AND A-71, RESPECTIVELY: 1 Cayman Islands included beginning Aug. 1973. For a given month, total assets may not equal total liabilities because 2 Total assets and total liabilities payable in U.S. dollars amounted to some branches do not adjust the parent's equity in the branch to reflect $37,817 million and $38,137 million, respectively, on Aug. 31, 1975. unrealized paper profits and paper losses caused by changes in exchange rates, which are used to convert foreign currency values into equivalent NOTE.—Components may not add to totals due to rounding. dollar values. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

NOVEMBER 1975 • CENTRAL BANK AND EXCHANGE RATES A 75 26. CENTRAL BANK RATES FOR DISCOUNTS AND ADVANCES TO COMMERCIAL BANKS (Per cent per annum) Rate as of October 31, 1975 Rate as of October 31, 1975 Country Country Per Month Per Month cent effective cent effective Argentina 18.0 Feb. 1972 Italy 6.0 Sept. 1975 Austria 6.0 Apr. 1975 Japan 6.5 Oct. 1975 Belgium 6.0 Aug. 1975 Mexico 4.5 June 1942 Brazil 18.0 Feb. 1972 Netherlands . . . . 4.5 Sept. 1975 Canada 9.0 Sept. 1975 Norway 5.0 Oct. 1975 Denmark 7.5 Aug. 1975 Sweden 6.0 Aug. 1975 France 8.0 Sept. 1975 Switzerland 3.0 Oct. 1975 Germany, Fed. Rep. of 3.5 Sept. 1975 United Kingdom 12.0 Oct. 1975 Venezuela 5.0 Oct. 1970 NOTE.—Rates shown are mainly those at which the central bank either Japan—Penalty rates (exceeding the basic rate shown) for borromings discounts or makes advances against eligible commercial paper and/or from the central bank in excess of an individual bank's quota; govt, securities for commercial banks or brokers. For countries with United Kingdom—The Bank's minimum lending rate, which is the more than one rate applicable to such discounts or advances, the rate average rate of discount for Treasury bills established at the most recent shown is the one at which it is understood the central bank transacts tender plus one-half per cent rounded to the nearest one-quarter per cent the largest proportion of its credit operations. Other rates for some of above; these countries follow: Venezuela—2 per cent for rediscounts of certain agricultural paper, 4y2 Argentina—3 and 5 per cent for certain rural and industrial paper, de- per cent for advances against government bonds, and 5Vi per cent for pending on type of transaction; rediscounts of certain industrial paper and on advances against promissory Brazil—8 per cent for secured paper and 4 per cent for certain agricultural notes or securities of first-class Venezuelan companies. paper; 27. FOREIGN EXCHANGE RATES (In cents per unit of foreign currency) Australia Austria Belgium Canada Denmark France Germany India Ireland Italy Japan Period (dollar) (schilling) (franc) (dollar) (krone) (franc) (Deutsche (rupee) (pound) (lira) (yen) mark) 1971 113.61 4.0009 2.0598 99.021 13.508 18.148 28.768 13.338 244.42 .16174 .28779 1972 119.23 4.3228 2.2716 100.937 14.384 19.825 31.364 13.246 250.08 .17132 .32995 1973 141.94 5.1649 2.5761 99.977 16.603 22.536 37.758 12.071 245.10 .17192 .36915 1974 143.89 5.3564 2.5713 102.257 16.442 20.805 38.723 12.460 234.03 .15372 .34302 1974—Oct 130.92 5.4068 2.5939 101.727 16.592 21.131 38.571 12.416 233.29 .14992 .33404 Nov 131 .10 5.5511 2.6529 101.280 16.997 21.384 39.836 12.397 232.52 .14996 .33325 Dec 131.72 5.7176 2.7158 101.192 17.315 22.109 40.816 12.352 232.94 .15179 .33288 1975—Jan 132.95 5.9477 2.8190 100.526 17.816 22.893 42.292 12.300 236.23 .15504 .33370 Feb 134.80 6.0400 2.8753 99.957 18.064 23.390 42.981 12.550 239.58 .15678 .34294 Mar 135.85 6.0648 2.9083 99.954 18.397 23.804 43.120 12.900 241.80 .15842 .34731 Apr 134.16 5.9355 2.8433 98.913 18.119 23.806 42.092 12.686 237.07 .15767 .34224 May 134.04 6.0033 2.8631 97.222 18.299 24.655 42.546 12.391 232.05 .15937 .34314 June 133.55 6.0338 2.8603 97.426 18.392 24.971 42.726 12.210 228.03 .15982 .34077 July 130.95 5.7223 2.7123 97.004 17.477 23.659 40.469 11.777 218.45 .15387 .33741 Aug 128.15 5.4991 2.6129 96.581 16.783 22.848 38.857 11.379 211.43 .14963 .33560 Sept 128.87 5.4029 2.5485 97.437 16.445 22.367 38.191 11.281 208.34 .14740 .33345 Oct 126.26 5.4586 2.5662 97.557 16.601 22.694 38.737 11.244 205.68 .14745 .33076 Malaysia Mexico Nether- New Norway Portugal South Spain Sweden Switzer- United Period (dollar) (peso) lands Zealand (krone) (escudo) Africa (peseta) (krona) land Kingdom (guilder) (dollar) (rand) (franc) (pound) 1971 32.989 8.0056 28.650 113.71 14.205 3.5456 140.29 1.4383 19.592 24.325 244.42 1972 35.610 8.0000 31.153 119.35 15.180 3.7023 129.43 1.5559 21.022 26.193 250.08 1973 40.988 8.0000 35.977 136.04 17.406 4.1080 143.88 1.7178 22.970 31.700 245.10 1974 41.682 8.0000 37.267 140.02 18.119 3.9506 146.98 1.7337 22.563 33.688 234.03 1974—Oct 41.560 8.0000 37.639 129.95 18.165 3.9246 142.75 1.7422 22.683 34.528 233.29 Nov 43.075 8.0000 38.438 130.42 18.404 3.9911 143.88 1.7522 23.175 36.384 232.52 Dec 42.431 8.0000 39.331 130.56 18.873 4.0400 144.70 1.7716 23.897 38.442 232.94 1975—Jan 43.359 8.0000 40.715 131.72 19.579 4.0855 145.05 1.7800 24.750 39.571 236.23 Feb 44.136 8.0000 41.582 133.30 19.977 4.1139 147.16 1.7784 25.149 40.450 239.58 Mar 44.582 8.0000 42.124 134.31 20.357 4.1276 148.70 1.7907 25.481 40.273 241.80 Apr 43.797 8.0000 41.291 132.66 20.049 4.0596 147.01 1 .7756 25.171 39.080 237.07 May 44.278 8.0000 41.581 131 .66 20.198 4.0933 146.69 1.7871 25.422 39.851 232.05 June 43.856 8.0000 41.502 130.86 20.393 4.1124 146.31 1.7922 25.532 40.086 228.03 July 41.442 8.0000 39.154 127.73 19.241 3.9227 139.75 1.7446 24.213 38.272 218.45 Aug 39.779 8.0000 37.887 111.79 18.304 3.7700 139.72 1.7140 23.174 37.332 211.43 Sept 38.219 8.0000 37.229 105.50 17.834 3.7048 131.40 1.6914 22.501 36.905 208.35 Oct 38.931 8.0000 37.658 104.74 18.089 3.7359 114.84 1.6883 22.769 37.555 205.68 NOTE.—Averages of certified noon buying rates in New York for cable transfers. For description of rates and back data, see "International Finance," Section 15 of Supplement to Banking and Monetary Statistics, 1962. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

> Q\ Board of Governors of the Federal Reserve System ARTHUR F. BURNS, Chairman GEORGE W. MITCHELL, Vice Chairman JEFFREY M. BUCHER PHILIP E. COLDWELL ROBERT C. HOLLAND HENRY C. WALLICH PHILIP C. JACKSON, JR. OFFICE OF MANAGING DIRECTOR OFFICE OF BOARD MEMBERS OFFICE OF MANAGING DIRECTOR FOR FOR OPERATIONS THOMAS J. O'CONNELL, Counsel to the RESEARCH AND ECONOMIC POLICY Chairman J R O O H D B N E i r R e M T c t . o J r . D E L N A K W L R E E R N , C M E, an D a e g p i u n t g y D M i a re n c a t g o i r n g J R O O S B E E P R H T R S . O C L O O Y M N O E N , , A A s d s v is is ta e n r t to to th th e e B B o o a a rd rd J A S . T R E C T P H H H A U E R R N L E L H S . . B P A R A X O R I I T L D E R A E O , , D A M , s a A s n i d s a t v a g is n in e t r g to to D th i t r h e e e c t B o B o r o a a r r d d GO a R n D d O N P ro B g . ra G m R IM D W ir O e O ct D o , r A f s o s r is tant Director J K A E Y B N o P N a A E r U d TH L B A. R E G N U N E E N M T A H N E , R , S p A e s c s i i a st l a n A t ss t i o st a th n e t B to o a t r h d e S M T U A R N R L A E Y Y A J. LT S M IG A E N L, N , As S s p i e st c a ia n l t A to s si t s h t e a nt B oa to r d t he Board Contingency Planning WILLIAM W. LAYTON, Director of Equal FRA Bo N a K r d O 'BRIEN, JR., Special Assistant to the NORMAND R. V. BERNARD, Special Assistant to the Board Employment Opportunity DONALD J. WINN, Special Assistant to the BRENTON C. LEAVITT, Program Director for Board Banking Structure PETER E. BARN A, Program Director for DIVISION OF RESEARCH AND STATISTICS Bank Holding Company Analysis LYLE E. GRAMLEY, Director JAMES L. KICHLINE, Associate Director JOSEPH S. ZEISEL, Associate Director EDWARD C. ETTIN, Adviser JOHN H. KALCHBRENNER, Adviser LEGAL DIVISION PETER M. KEIR, Adviser JAMES B. ECKERT, Associate Adviser DIVISION OF FEDERAL RESERVE BANK JOHN D. HAWKE, JR., General Counsel JOHN J. MINGO, Associate Adviser OPERATIONS BALDWIN B. TUTTLE, Assistant General ELEANOR J. STOCKWELL, Associate Adviser Counsel HELMUT F. WENDEL, Associate Adviser JAMES R. KUDLINSKI, Director CHARLES R. MCNEILL, Assistant to the JAMES R. WETZEL, Associate Adviser *E. MAURICE MCWHIRTER, Associate Director General Counsel ROBERT M. FISHER, Assistant Adviser WALTER A. ALTHAUSEN, Assistant Director ROBERT E. MANNION, Adviser J. CORTLAND G. PERET, Assistant Adviser BRIAN M. CAREY, Assistant Director ALLEN L. RAIKEN, Adviser STEPHEN P. TAYLOR, Assistant Adviser HARRY A. GUINTER, Assistant Director GARY M. WELSH, Adviser LEVON H. GARABEDIAN, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DIVISION OF FEDERAL RESERVE BANK OFFICE OF SAVER AND CONSUMER AFFAIRS DIVISION OF INTERNATIONAL FINANCE EXAMINATIONS AND BUDGETS W C T P. H L IL Y O D L . D M I E A A R S M H I N . E G H . F , . A M R A W E N s A s A S i L s W D t L , a O A n A R t C s T E s H , i s , D ta J i D n R r t e i . , r c e t A o ct r s D o s i r i r s e ta c n to t r Director J F J R E A R O R N E B B A D E o E T U E a R r R L T d O D IC . S . C a H S . n O P A d K L L R O L O T T D , U M K C i D O r I K e N N e c M , p , t u o A A A t r y N s s , s s i i s s A t D t a a s i n s n r i t t e s t c a to t n o D r t i t r h e e c D to ir r e ctor * * J H R R R O O E E A H E L B L N D E E P N H R E J T . . C B I F . . R R . E V J B G Y U I R N E N N Y M E O Z A , , L M N D I T A L S A , , d L d v , v A i D i s c s e i A e t r r i r e n d c g v t i o s r e r D irector SAMUEL PIZER, Adviser DIVISION OF DATA PROCESSING GEORGE B. HENRY, Associate Adviser CHARLES L. HAMPTON, Director OFFICE OF THE SECRETARY CHARLES J. SIEGMAN, Associate Adviser BRUCE M. BEARDSLEY, Associate Director THEODORE E. ALLISON, Secretary EDWIN M. TRUMAN, Associate Adviser GLENN L. CUMMINS, Assistant Director GRIFFITH L. GARWOOD, Assistant Secretary WARREN N. MINAMI, Assistant Director F ROBERT SMITH III, Assistant Secretary ROBERT J. ZEMEL, Assistant Director DIVISION OF BANKING SUPERVISION DIVISION OF PERSONNEL AND REGULATION KEITH D. ENGSTROM, Director BRENTON C. LEAVITT, Director CHARLES W. WOOD, Assistant Director FREDERICK R. DAHL, Assistant Director JACK M. EGERTSON, Assistant Director OFFICE OF THE CONTROLLER JOHN N. LYON, Assistant Director JOHN T. MCCLINTOCK, Assistant Director JOHN KAKALEC, Controller JOHN E. RYAN, Assistant Director TYLER E. WILLIAMS, JR., Assistant Controller THOMAS A. SIDMAN, Assistant Director WILLIAM W. WILES, Assistant Director DIVISION OF ADMINISTRATIVE SERVICES WALTER W. KREIMANN, Director tOn loan from the Federal Reserve Bank of Dallas. DONALD E. ANDERSON, Assistant Director JOHN D. SMITH, Assistant Director *On leave of absence. > Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 78 Federal Open Market Committee ARTHUR F. BURNS, Chairman PAUL A. :ER, Vice Chairman ERNEST T. BAUGHMAN DAVID P. EASTBURN ROBERT P. MAYO JEFFREY M. BUCHER ROBERT C. HOLLAND GEORGE W. MITCHELL PHILIP E. COLDWELL PHILIP C. JACKSON, JR. HENRY C. WALLICH BRUCE K. MACLAURY ARTHUR L. BROIDA, Secretary ROBERT SOLOMON, Economist MURRAY ALTMANN, Deputy Secretary (International Finance) NORMAND R. V. BERNARD, Assistant EDWARD G. BOEHNE, Associate Economist Secretary *RALPH C. BRYANT, Associate Economist THOMAS J. O'CONNELL, General Counsel RICHARD G. DAVIS, Associate Economist EDWARD G. GUY, Deputy General Counsel RALPH T. GREEN, Associate Economist J. CHARLES PARTEE, Senior Economist JOHN KAREKEN, Associate Economist STEPHEN H. AXILROD, Economist JOHN E. REYNOLDS, Associate Economist (Domestic Finance) KARL O. SCHELD, Associate Economist LYLE E. GRAMLEY, Economist (Domestic Business) ALAN R. HOLMES, Manager, System Open Market Account PETER D. STERNLIGHT, Deputy Manager for Domestic Operations SCOTT E. PARDEE, Deputy Manager for Foreign Operations *On leave of absence Federal Advisory Council THOMAS I. STORRS, FIFTH FEDERAL RESERVE DISTRICT, President GEORGE B. ROCKWELL, FIRST FEDERAL EDWIN S. JONES, EIGHTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT ELLMORE C. PATTERSON, SECOND FEDERAL GEORGE H. DIXON, NINTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT JAMES F. BODINE, THIRD FEDERAL EUGENE H. ADAMS, TENTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT CLAIR E. FULTZ, FOURTH FEDERAL BEN F. LOVE, ELEVENTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT LAWRENCE A. MERRIGAN, SIXTH FEDERAL JAMES B. MAYER, TWELFTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT WILLIAM F. MURRAY, SEVENTH FEDERAL RESERVE DISTRICT HERBERT V. PROCHNOW, Secretary WILLIAM J. KORSVIK, Associate Secretary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 79 Federal Reserve Banks, Branches, and Offices FEDERAL RESERVE BANK, Chairman President Vice President branch, or facility Zip Deputy Chairman First Vice President in charge of branch BOSTON* 02106 Louis W. Cabot Frank E. Morris Robert M. Solow James A. Mcintosh NEW YORK* 10045 Roswell L. Gilpatric Paul A. Volcker Frank R. Milliken Richard A. Debs Buffalo 14240 Donald Nesbitt Ronald B. Gray PHILADELPHIA 19105 John R. Coleman David P. Eastburn Edward J. Dwyer Mark H. Willes CLEVELAND* 44101 Horace A. Shepard Willis J. Winn Robert E. Kirby Walter H. MacDonald Cincinnati 45201 Phillip R. Shriver Robert E. Showalter Pittsburgh 15230 G. Jackson Tankersley Robert D. Duggan RICHMOND* 23261 Robert W. Lawson, Jr. Robert P. Black E. Craig Wall, Sr. George C. Rankin Baltimore 21203 James G. Harlow Jimmie R. Monhollon Charlotte 28230 Charles W. DeBell Stuart P. Fishburne Culpeper Communications Center 22701 Albert D. Tinkelenberg ATLANTA 30303 H. G. Pattillo Monroe Kimbrel Clifford M. Kirtland, Jr. Kyle K. Fossum Birmingham 35202 Frank P. Samford, Jr. Hiram J. Honea Jacksonville 32203 James E. Lyons Edward C. Rainey Miami 33152 Castle W. Jordan W. M. Davis Nashville 37203 John C. Tune Jeffrey J. Wells New Orleans 70161 Floyd W. Lewis George C. Guynn CHICAGO* 60690 Peter B. Clark Robert P. Mayo Robert H. Strotz Daniel M. Doyle Detroit 48231 W. M. Defoe William C. Conrad ST. LOUIS 63166 Edward J. Schnuck Darryl R. Francis Sam Cooper Eugene A. Leonard Little Rock 72203 Ronald W. Bailey John F. Breen Louisville 40201 James H. Davis Donald L. Henry Memphis 38101 Jeanne L. Holley L. Terry Britt MINNEAPOLIS 55480 Bruce B. Dayton Bruce K. MacLaury James P. McFarland Clement A. Van Nice Helena 59601 William A. Cordingley John D. Johnson KANSAS CITY 64198 Robert T. Person George H. Clay Harold W. Andersen John T. Boysen Denver 80217 Maurice B. Mitchell J. David Hamilton Oklahoma City 73125 James G. Harlow, Jr. William G. Evans Omaha 68102 Durward B. Varner Robert D. Hamilton DALLAS 75222 John Lawrence Ernest T. Baughman Charles T. Beaird T. W. Plant El Paso 79999 Herbert M. Schwartz Fredric W. Reed Houston 77001 Thomas J. Barlow James L. Cauthen San Antonio 78295 Pete J. Morales, Jr. Carl H. Moore SAN FRANCISCO .. ..94120 O. Meredith Wilson John J. Balles Joseph F. Alibrandi John B. Williams Los Angeles 90051 Joseph R. Vaughan Richard C. Dunn Portland 97208 Loran L. Stewart Angelo S. Carella Salt Lake City 84110 Sam Bennion A. Grant Holman Seattle ..98124 Malcolm T. Stamper James J. Curran * Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; Cranford, New Jersey 07016; Jericho, New York 11753; Columbus, Ohio 43216; Columbia, South Carolina 29210; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 80 Federal Reserve Board Publications Available from Publications Services, Division of Ad- request and be made payable to the order of the Board ministrative Services, Board of Governors of the Fed- of Governors of the Federal Reserve System in a form eral Reserve System, Washington, D.C. 20551. Where collectible at par in U.S. currency. (Stamps and a charge is indicated, remittance should accompany coupons are not accepted.) THE FEDERAL RESERVE SYSTEM—PURPOSES AND 9. Federal Reserve Banks. 1965. 36 pp. $.35. Sec. FUNCTIONS. 1974. 125 pp. $1.00each; lOormore 10. Member Bank Reserves and Related Items. to one address, $.75 each. 1962. 64 pp. $.50. Sec. 11. Currency. 1963. 11 ANNUAL REPORT pp. $.35. Sec. 12. Money Rates and Securities Markets. 1966. 182 pp. $.65. Sec. 14. Gold. 1962. FEDERAL RESERVE BULLETIN. Monthly. $20.00 per year or $2.00 each in the United States, its posses- 24 pp. $.35. Sec. 15. International Finance. 1962. sions, and certain foreign countries1; 10 or more 92 pp. $.65. Sec. 16 (New). Consumer Credit. of same issue to one address, $18.00 per year or 1965. 103 pp. $.65. $1.75 each. Elsewhere, $24.00 per year or $2.50 THE FEDERAL FUNDS MARKET. 1959. Ill pp. $1.00 each. each; 10 or more to one address, $.85 each. FEDERAL RESERVE CHART BOOK ON FINANCIAL AND TRADING IN FEDERAL FUNDS. 1965. 116 pp. $1.00 BUSINESS STATISTICS. Monthly. Subscription in- each; 10 or more to one address, $.85 each. cludes one issue of Historical Chart Book. $12.00 INDUSTRIAL PRODUCTION—1971 EDITION. 1972. 383 per year or $1.25 each in the United States, its pp. $4.00 each; 10 or more to one address, $3.50 possessions, and certain foreign countries1; 10 or each. more of same issue to one address, $1.00 each. THE PERFORMANCE OF BANK HOLDING COMPANIES. Elsewhere, $15.00 per year or $1.50 each. 1967. 29 pp. $.25 each; 10 or more to one address, HISTORICAL CHART BOOK. Issued annually in Sept. $.20 each. Subscription to monthly chart book includes one BANK CREDIT-CARD AND CHECK-CREDIT PLANS. 1968. issue. $1.25 each in the United States, its posses- 102 pp. $1.00 each; 10 or more to one address, sions, and certain foreign countries1; 10 or more $.85 each. to one address, $1.00 each. Elsewhere, $1.50 each. SURVEY OF FINANCIAL CHARACTERISTICS OF CON- SUMERS. 1966. 166 pp. $1.00 each; 10 or more CAPITAL MARKET DEVELOPMENTS. Weekly. $15.00 per year or $.40 each in the United States, its posses- to one address, $.85 each. sions, and certain foreign countries1; 10 or more SURVEY OF CHANGES IN FAMILY FINANCES. 1968. 321 of same issue to one address, $13.50 per year or pp. $1.00 each; 10 or more to one address, $.85 $.35 each. Elsewhere, $20.00 per year or $.50 each. each. REPORT OF THE JOINT TREASURY-FEDERAL RESERVE SELECTED INTEREST AND EXCHANGE RATES—WEEKLY STUDY OF THE U.S. GOVERNMENT SECURITIES SERIES OF CHARTS. Weekly. $15.00 per year or MARKET. 1969. 48 pp. $.25 each; 10 or more to $.40 each in the United States, its possessions, and one address, $.20 each. certain foreign countries1; 10 or more of same issue JOINT TREASURY-FEDERAL RESERVE STUDY OF THE to one address, $13.50 per year or $.35 each. GOVERNMENT SECURITIES MARKET: STAFF STUD- Elsewhere, $20.00 per year or $.50 each. IES—PART 1. 1970. 86 pp. $.50 each; 10 or more to one address, $.40 each. PART 2. 1971. 153 pp. THE FEDERAL RESERVE ACT, as amended through December 1971, with an appendix containing provi- and PART 3. 1973. 131 pp. Each volume $1.00; sions of certain other statutes affecting the Federal 10 or more to one address, $.85 each. Reserve System. 252 pp. $1.25. OPEN MARKET POLICIES AND OPERATING PROCE- REGULATIONS OF THE BOARD OF GOVERNORS OF THE DURES—STAFF STUDIES. 1971. 218 pp. $2.00 each; 10 or more to one address, $1.75 each. FEDERAL RESERVE SYSTEM PUBLISHED INTERPRETATIONS OF THE BOARD OF GOV- REAPPRAISAL OF THE FEDERAL RESERVE DISCOUNT ERNORS, as of June 30, 1975. $2.50. MECHANISM. Vol. 1. 1971. 276 pp. Vol. 2. 1971. 173 pp. Vol. 3. 1972. 220 pp. Each volume $3.00; SUPPLEMENT TO BANKING AND MONETARY STATISTICS. Sec. 1. Banks and the Monetary System. 1962. 10 or more to one address, $2.50 each. 35 pp. $.35. Sec. 2. Member Banks. 1967. 59 THE ECONOMETRICS OF PRICE DETERMINATION CONpp. $.50. Sec. 5. Bank Debits. 1966. 36 pp. $.35. FERENCE, October 30-31, 1970, Washington, D.C. Sec. 6. Bank Income. 1966. 29 pp. $.35. Sec. Oct. 1972. 397 pp. Cloth ed. $5.00 each; 10 or more to one address, $4.50 each. Paper ed. $4.00 each; 10 or more to one address, $3.60 each. FEDERAL RESERVE STAFF STUDY: WAYS TO MODERATE 'Bolivia, Canada, Chile, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, Guatemala, Haiti, Republic of FLUCTUATIONS IN HOUSING CONSTRUCTION, Dec. 1972. 487 pp. $4.00 each; 10 or more to one Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, El Salvador, Uruguay, and Venezuela. address, $3.60 each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Board Publications A 81 LENDING FUNCTIONS OF THE FEDERAL RESERVE INTEREST RATES, CREDIT FLOWS, AND MONETARY AG- BANKS. 1973. 271 pp. $3.50 each; 10 or more GREGATES SINCE 1964. 6/71. to one address, $3.00 each. REVISED MEASURES OF MANUFACTURING CAPACIY INTRODUCTION TO FLOW OF FUNDS. 1975. 64 pp. $.50 UTILIZATION. 10/71. each; 10 or more to one address, $.40 each. REVISION OF BANK CREDIT SERIES. 12/71. IMPROVED FUND AVAILABILITY AT RURAL BANKS (Re- ASSETS AND LIABILITIES OF FOREIGN BRANCHES OF port and study papers of the Committee on Rural U.S. BANKS. 2/72. Banking Problems). June 1975. 133 pp. $1.00; 10 BANK DEBITS, DEPOSITS, AND DEPOSIT TURNOVER— or more to one address, $.85 each. REVISED SERIES. 7/72. YIELDS ON NEWLY ISSUED CORPORATE BONDS. 9/72. RECENT ACTIVITIES OF FOREIGN BRANCHES OF U.S. STAFF ECONOMIC STUDIES BANKS. 10/72. REVISION OF CONSUMER CREDIT STATISTICS. 10/72. Studies and papers on economic and financial subjects ONE-BANK HOLDING COMPANIES BEFORE THE 1970 that are of general interest in the field of economic AMENDMENTS. 12/72. research. YIELDS ON RECENTLY OFFERED CORPORATE BONDS. 5/73. CAPACITY UTILIZATION IN MAJOR MATERIALS INDUS- SUMMARIES ONLY PRINTED IN THE BULLETIN TRIES. 8/73. (Limited supply of mimeographed copies of full CREDIT-CARD AND CHECK-CREDIT PLANS AT COMMERtext available upon request for single copies) CIAL BANKS. 9/73. RATES ON CONSUMER INSTALMENT LOANS. 9/73. THE IMPACT OF HOLDING COMPANY ACQUISITIONS ON NEW SERIES FOR LARGE MANUFACTURING CORPORA- AGGREGATE CONCENTRATION IN BANKING, by TIONS. 10/73. Samuel H. Talley. Feb. 1974. 24 pp. MONEY SUPPLY IN THE CONDUCT OF MONETARY OPERATING POLICIES OF BANK HOLDING COMPANIES— POLICY. 11/73. PART II: NONBANKING SUBSIDIARIES, by Robert J. U.S. ENERGY SUPPLIES AND USES, Staff Economic Lawrence. Mar. 1974. 59 pp. Study by Clayton Gehman. 12/73. HOUSEHOLD-SECTOR ECONOMIC- ACCOUNTS, by David CAPACITY UTILIZATION FOR MAJOR MATERIALS: RE- F. Seiders. Jan. 1975. 84 pp. VISED MEASURES. 4/74. THE PERFORMANCE OF INDIVIDUAL BANK HOLDING NUMERICAL SPECIFICATIONS OF FINANCIAL VARIABLES COMPANIES, by Arthur G. Fraas. Aug. 1975. AND THEIR ROLE IN MONETARY POLICY. 5/74. 27 pp. INFLATION AND STAGNATION IN MAJOR FOREIGN IN- DUSTRIAL COUNTRIES. 10/74. PRINTED IN FULL IN THE BULLETIN REVISION OF THE MONEY STOCK MEASURES AND MEM- BER BANK DEPOSITS. 12/74. Staff Economic Studies shown in list below. U.S. INTERNATIONAL TRANSACTIONS IN 1974. 4/75. MONETARY POLICY IN A CHANGING FINANCIAL ENVI- REPRINTS RONMENT: OPEN MARKET OPERATIONS IN 1974. 4/75. (Except for Staff Papers, Staff Economic Studies, and THE STRUCTURE OF MARGIN CREDIT. 4/75. some leading articles, most of the articles reprinted do CHANGES IN BANK LENDING PRACTICES, 1974. 4/75. not exceed 12 pages.) NEW STATISTICAL SERIES ON LOAN COMMITMENTS AT SEASONAL FACTORS AFFECTING BANK RESERVES. 2/58. SELECTED LARGE COMMERCIAL BANKS. 4/75. MEASURES OF MEMBER BANK RESERVES. 7/63. RECENT TRENDS IN FEDERAL BUDGET POLICY. 7/75. RESEARCH ON BANKING STRUCTURE AND PERFORM- BANKING AND MONETARY STATISTICS, 1974. Selected ANCE, Staff Economic Study by Tynan Smith. series of banking and monetary statistics for 1974 4/66. only. 2/75, 3/75, 4/75 and 7/75. A REVISED INDEX OF MANUFACTURING CAPACITY, CHANGES IN TIME AND SAVINGS DEPOSITS AT COM- Staff Economic Study by Frank de Leeuw with MERCIAL BANKS. January-April 1975. 10/75. Frank E. Hopkins and Michael D. Sherman. 11/66. RECENT DEVELOPMENTS IN INTERNATIONAL FINANCIAL U.S. INTERNATIONAL TRANSACTIONS: TRENDS IN MARKETS. 10/75. 1960-67. 4/68. MINNIE: A SMALL VERSION OF THE MIT-PENN-SSRC MEASURES OF SECURITY CREDIT. 12/70. ECONOMETRIC MODEL, Staff Economic Study by MONETARY AGGREGATES AND MONEY MARKET CON- Douglas Battenberg, Jared J. Enzler and Arthur M. DITIONS IN OPEN MARKET POLICY. 2/71. Havenner. 11/75. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 82 Federal Reserve Bulletin • November 1975 Index to Statistical Tables References are to pages A-2 through A-75 although the prefix 4'A" is omitted in this index (For list of tables published periodically, but not monthly, see inside back cover) ACCEPTANCES, bankers, 9, 25, 27 Demand deposits: Agricultural loans of commercial banks, 16, 18 Adjusted, commercial banks, 11, 13, 17 Assets and liabilities (See also Foreigners): Banks, by classes, 14, 17, 20, 21 Banks, by classes, 14, 16, 17, 18, 30 Ownership by individuals, partnerships, and cor- Federal Reserve Banks, 10 porations, 24 Nonfinancial corporations, current, 41 Subject to reserve requirements, 13 Automobiles: Turnover, 11 Consumer instalment credit, 45, 46, 47 Deposits (See also specific types of deposits): Production index, 48, 49 Accumulated at commercial banks for payment of personal loans, 24 BANK credit proxy, 13 Banks, by classes, 14, 17, 20, 21, 30 Bankers balances, 16, 17, 20 Federal Reserve Banks, 10, 72 (See also Foreigners) Subject to reserve requirements, 13 Banks for cooperatives, 38 Discount rates at Federal Reserve Banks (See Interest Bonds (See also U.S. Govt, securities): rates) New issues, 38, 39, 40 Discounts and advances by Reserve Banks (See Loans) Yields and prices, 28, 29 Dividends, corporate, 41 Branch banks: Assets, foreign branches of U.S. banks, 70 EMPLOYMENT, 50, 52 Liabilities of U.S. banks to their foreign branches and foreign branches of U.S. banks, 22, 71 FARM mortgage loans, 42 Brokerage balances, 69 Federal agency obligations, 9, 10, 11 Business expenditures on new plant and equipment, 41 Federal finance: Business indexes, 50 Receipts and outlays, 32, 33 Business loans (See Commercial and industrial loans) Treasury operating balance, 32 Federal funds, 5, 16, 18, 21, 27 CAPACITY utilization, 50 Federal home loan banks, 37, 38 Capital accounts: Federal Home Loan Mortgage Corporation, 37, 42, 43 Banks, by classes, 14, 17, 22 Federal Housing Administration, 42, 43, 44 Federal Reserve Banks, 10 Federal intermediate credit banks, 37, 38 Central banks, 60, 75 Federal land banks, 37, 38, 42 Certificates of deposit, 22 Federal National Mortgage Assn., 37, 38, 42, 43, 44 Commercial and industrial loans: Federal Reserve Banks: Commercial banks, 13, 16 Condition statement, 10 Weekly reporting banks, 18, 23 U.S. Govt, securities held, 2, 10, 11, 34, 35 Commercial banks: Federal Reserve credit, 2, 4, 10, 11 Assets and liabilities, 13, 14, 16, 17, 18 Federal Reserve notes, 10 Consumer loans held, by type, 45 Federally sponsored credit agencies, 37, 38 Deposits at, for payment of personal loans, 24 Finance companies: Loans sold outright, 25 Loans, 18, 46, 47 Number, by classes, 14 Paper, 25, 27 Real estate mortgages held, by type of holder and Financial institutions, loans to, 16, 18 property, 42-44 Float, 2 Commercial paper, 23, 25, 27 Flow of funds, 56, 57 Condition statements (See Assets and liabilities) Foreign: Construction, 50, 51 Currency operations, 10 Consumer credit: Deposits in U.S. banks, 3, 10, 17, 21, 72 Instalment credit, 45, 46, 47 Exchange rates, 75 Noninstalment credit, 45 Trade, 59 Foreigners: Consumer price indexes, 50, 53 Consumption expenditures, 54, 55 Claims on, 66, 67, 68, 72, 73, 74 Corporations: Liabilities to, 22, 61, 62, 64, 65, 72, 73, 74 Profits, taxes, and dividends, 41 Security issues, 39, 40 GOLD: Security yields and prices, 28, 29 Certificates, 10 Cost of living (See Consumer price indexes) Reserves of central banks and govts., 60 Currency and coin, 3, 16 Stock, 2, 59 Currency in circulation, 3, 12 Government National Mortgage Assn., 42 Customer credit, stock market, 29, 30 Gross national product, 54, 55 DEBITS to deposit accounts, 11 HOUSING permits, 50 Debt (See specific types of debt or securities) Housing starts, 51 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 83 References are to pages A-2 through A-75 although the prefix "A" is omitted in this index INCOME, national and personal, 54, 55 REAL estate loans: Industrial production index, 48, 49, 50 Banks, by classes, 16, 18, 30, 42 Instalment loans, 45, 46, 47 Mortgage yields, 43, 44 Insurance companies, 31, 34, 35, 42, 44 Type of holder and property Insured commercial banks, 14, 16, 17, 24 mortgaged, 42—44 Interbank deposits, 14, 20 Reserve position, basic, member banks, 5 Interest rates: Reserve requirements, member banks, 7 Bond and stock yields, 28 Reserves: Business loans of banks, 26 Central banks and govts., 60 Federal Reserve Banks, 6 Commercial banks, 17, 20, 22 Foreign countries, 74, 75 Federal Reserve Banks, 10 Money market rates, 27 Member banks, 3, 4, 13, 17 Mortgage yields, 43, 44 U.S. reserve assets, 59 Prime rate, commercial banks, 26 Residential mortgage loans, 43, 44 Time and savings deposits, maximum rates, 8 Retail credit, 45, 46, 47 International capital transactions of U.S., 61-74 Retail sales, 50 International institutions, 60-64, 66, 67-69, 73 Inventories, 54 SAVING: Investment companies, issues and assets, 40 Flow of funds series, 56, 57 Investments (See also specific types of investments): National income series, 54, 55 Banks, by classes, 14, 16, 19, 30 Savings and loan assns., 31, 35, 42, 44 Commercial banks, 13 Savings deposits (See Time deposits) Federal Reserve Banks, 10, 11 Savings institutions, principal assets, 30, 31 Life insurance companies, 31 Securities (See also U.S. Govt, securities): Savings and loan assns., 31 Federally sponsored agencies, 37, 38 International transactions, 68, 69 LABOR force, 52 New issues, 38, 39, 40 Life insurance companies (See Insurance companies) Yields and prices, 28, 29 Loans (See also specific types of loans): Special Drawing Rights, 2, 10, 58, 59 Banks, by classes, 14, 16, 18, 30 State and local govts.: Commercial banks, 13, 14^ 16, 18, 23, 25, 26 Deposits, 17, 20 Federal Reserve Banks, 2, 4, 6, 10, 11 Holdings of U.S. Govt, securities, 34, 35 Insurance companies, 31, 44 New security issues, 38, 39 Insured or guaranteed by U.S., 42, 43, 44 Ownership of securities of, 16, 19, 30 Savings and loan assns., 31 Yields and prices of securities, 28, 29 State member banks, 15, 24 MANUFACTURERS: Stock market credit, 29, 30 Capacity utilization, 50 Stocks (See also Securities): Production index, 49, 50 New issues, 39, 40 Margin requirements, 8 Yields and prices, 28, 29 Member banks: Assets and liabilities, by classes, 14, 16, 17 TAX receipts, Federal, 33 Borrowings at Federal Reserve Banks, 4, 10 Time deposits, 8, 13, 14, 17, 21, 22 Number, by classes, 14 Treasury currency, Treasury cash, 2, 3 Reserve position, basic, 5 Treasury deposits, 3, 10, 32 Reserve requirements, 7 Treasury operating balance, 32 Reserves and related items, 2, 4, 13 Mining, production index, 49 UNEMPLOYMENT, 52 Mobile home shipments, 51 U.S. balance of payments, 58 Money market rates (See Interest rates) U.S. Govt, balances: Money stock and related data, 12 Commercial bank holdings, 17, 20 Mortgages (See Real estate loans and Residential Member bank holdings, 13 mortgage loans) Treasury deposits at Reserve Banks, 3, 10, 32 Mutual funds (See Investment companies) U.S. Govt, securities: Mutual savings banks, 20, 30, 34, 42, 44 Bank holdings, 14, 16, 19, 30, 34, 35 Dealer transactions, positions, and financing, 36 NATIONAL banks, 14, 24 Federal Reserve Bank holdings, 2, 10, 11, 34, 35 National defense expenditures, 33 Foreign and international holdings, 10, 66, 68, 72 National income, 54, 55 International transactions, 66, 68 Nonmember banks, 15, 16, 17, 24 New issues, gross proceeds, 39 Open market transactions, 9 OPEN market transactions, 9 Outstanding, by type of security, 34, 35 Ownership, 34, 35 Yields and prices, 28, 29 PAYROLLS, manufacturing index, 50 Utilities, production index, 49 Personal income, 55 Prices: VETERANS Administration, 43, 44 Consumer and wholesale commodity, 50, 53 Security, 29 Prime rate, commercial banks, 26 WEEKLY reporting banks, 18-22 Production, 48, 49, 50 Profits, corporate, 41 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 84 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories Minneapolis^ Chicago | f^tCfaCi Omaha* X/NCTMWD 'enver Kansas City^ J ^ t Oklahoma Citjf Dallas Jioustxm MewOr(ta»* HAWAII LEGEND — Boundaries of Federal Reserve Districts ® Federal Reserve Bank Cities Boundaries of Federal Reserve Branch • Federal Reserve Branch Cities Territories Federal Reserve Bank Facility Q Board of Governors of the Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Guide to Tabular Presentation SYMBOLS AND ABBREVIATIONS e Estimated N.S.A. Monthly (or quarterly) figures not adjusted c Corrected for seasonal variation IPC Individuals, partnerships, and corporations P Preliminary SMSA Standard metropolitan statistical area r Revised A Assets rp Revised preliminary L Liabilities I, II, S Sources of funds III, IV Quarters U Uses of funds * Amounts insignificant in terms of the particn.e.c. Not elsewhere classified ular unit (e.g., less than 500,000 when A.R. Annual rate the unit is millions) S. A. Monthly (or quarterly) figures adjusted for (1) Zero, (2) no figure to be expected, or seasonal variation (3) figure delayed GENERAL INFORMATION Minus signs are used to indicate (1) a decrease, (2) also include not fully guaranteed issues) as well as direct a negative figure, or (3) an outflow. obligations of the Treasury. "State and local govt." A heavy vertical rule is used in the following in- also includes municipalities, special districts, and other stances: (1) to the right (to the left) of a total when political subdivisions. the components shown to the right (left) of it add to In some of the tables details do not add to totals that total (totals separated by ordinary rules include because of rounding. more components than those shown), (2) to the right The footnotes labeled NOTE (which always appear (to the left) of items that are not part of a balance sheet, last) provide (1) the source or sources of data that do (3) to the left of memorandum items. not originate in the System; (2) notice when figures "U.S. Govt, securities" may include guaranteed are estimates; and (3) information on other characissues of U.S. Govt, agencies (the flow of funds figures teristics of the data. TABLES PUBLISHED QUARTERLY, SEMIANNUALLY, OR ANNUALLY, WITH LATEST BULLETIN REFERENCE Quarterly Issue Page Annually—Continued Issue Page Sales, revenue, profits, and Banks and branches, number, dividends of large manuby class and State Apr. 1975 A-76—A-77 facturing corporations Sept. 1975 A-82 Semiannually Flow of funds: Banking offices: Assets and liabilities: Number in the 1962-73 Oct. 1974 A-59.14—A-59.28 United States Aug. 1975 A-76 NNuummbbeerr ooff ppaarr aanndd nnoonnppaarr AAuugg.. 1975 A-77 Flows: 1965-73 Oct. 1974 A-58—A-59.13 Annually Bank holding companies: Income and expenses: Banking offices and depos- Federal Reserve Banks .. Feb. 1975 A-80—A-81 its of group banks, Dec. Insured commercial banks June 1975 A-80—A-81 31, 1974 June 1975 A-76— -A-79 Member banks: Banking and monetary statistics: Calendar year June 1975 A-80—A-89 1974 Feb. 1975 A-84— -A-85 Income ratios June 1975 A-90—A-95 Mar. 1975 A-79— -A-82 Operating ratios Sept. 1975 A-76—A-81 Apr. 1975 A-78— -A-85 May 1975 337 July 1975 A-77 Stock market credit Feb. 1975 A-86—A-87 Statistical Releases LIST PUBLISHED SEMIANNUALLY, WITH LATEST BULLETIN REFERENCE Issue Page Anticipated schedule of release dates for individual releases June 1975 A-101 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis