Federal Reserve Bulletin, 1976-08

AUGUST 1976 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A copy of the Federal Reserve Bulletin is sent to each member bank without charge; member banks desiring additional copies may secure them at a special $10.00 annual rate. The regular subscription price in the United States, its possessions, Canada, and Mexico is $20.00 per annum or $2.00 per copy; elsewhere, $24.00 per annum or $2.50 per copy. Group subscriptions in the United States for 10 or more copies to one address, $1.75 per copy per month, or $18.00 for 12 months. The Bulletin may be obtained from the Division of Administrative Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551, and remittance should be made payable to the order of the Board of Governors of the Federal Reserve System in a form collectible at par in U.S. currency. (Stamps and coupons are not accepted.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN NUMBER 8 □ VOLUME 62 □ AUGUST 1976 CONTENTS 651 Domestic Financial Developments A1 Financial and Business Statistics in the Second Quarter of 1976 A1 Contents 658 Member Bank Income in 1975 A2 U.S. Statistics A58 International Statistics 665 The Federal Reserve System’s Equal Employment Opportunity A76 Board of Governors and Staff Program A78 Open Market Committee and Staff; 668 Statements to Congress Federal Advisory Council 676 Record of Policy Actions A79 Federal Reserve Banks and Branches of the Federal Open Market Committee A80 Federal Reserve Board Publications 687 Law Department A82 Index to Statistical Tables 729 Announcements A84 Map of Federal Reserve System 731 Industrial Production Inside Back Cover: Guide to Tabular Presentation and Statistical Releases PUBLICATIONS COMMITTEE Lyle E. Gramley Joseph R. Coyne John M. Denkler Ralph C. Bryant Frederic Solomon 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

Domestic Financial Developments in the Second Quarter of 1 9 7 6 This report, which was sent to the Joint Eco­ households, which stepped up the pace of their nomic Committee of the U.S. Congress on Au­ borrowing in the mortgage and consumer loan gust 13, 1976, highlights the important devel­ markets. The Federal Government was the only opments in financial markets during the spring major sector registering a lower level of bor­ and early summer. rowing; however, the Treasury’s efforts to lengthen the maturity structure of its marketable The total volume of funds raised in domestic debt were reflected in a large volume of note financial markets increased during the second and bond issues. quarter of 1976, as total spending in the Na­ Most interest rates posted moderate declines tion’s economy expanded further. In the busi­ during the opening weeks of the second quarter; ness sector, the cyclically improved level of indeed, some short-term yields reached their profits continued to limit the amount of external lowest levels in more than 3 years. However, funds needed to finance rising capital outlays. growth of the monetary aggregates, after accel­ Nevertheless, the desire of many firms to erating in February and March, reached ex­ strengthen their balance sheets kept offerings of traordinary proportions in April. The Federal new corporate stock and bonds at a very high Reserve consequently became somewhat less level, and nonfinancial enterprises added to their accommodative in the provision of reserves to total short-term indebtedness during the second the banking system. Reflecting the System’s quarter for the first time since late 1974. The actions, as well as intensifying credit demands, aggregate credit demands of State and local the interest rate on Federal funds—interbank governments also increased, as did those of loans of immediately available funds on an Interest rates Per cent per annum SHORT-TERM LONG-TERM NOTES: Federal funds Monthly averages except for conventional mortgages (based on Conventional quotations for one day each mortgages Aaa utility month). Yields: U.S. Treasury HUD | _ A. New issue bills, market yields on 3-month issues; prime commercial paper, dealer offering rates; Conventional mortgages, rates on first mortgages in primary markets, unweighted and rounded to nearest 5 basis points, from Dept, of Housing and Urban Development; Aaa utility bonds, weighted averages of new F.R. discount rate publicly offered bonds rated Aaa, Aa, and A by Moody’s Investors Treasury bills State and local Service and adjusted to Aaa basis; 3-month government U.S. Govt, bonds, market yields adjusted to 20-year constant matu­ rity by U.S. Treasury; State and local govt, bonds (20 issues, mixed quality) Bond Buyer. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

652 Federal Reserve Bulletin □ August 1976 overnight basis—rose from 4% per cent in late Steps were then taken to provide bank reserves April to about 5xh per cent at the end of May; somewhat more freely, and the Federal funds it fluctuated around this higher level for the rate declined to about 5XA per cent in early July. remainder of the quarter. Other interest rates also declined in July as the Other short-term market rates of interest also Federal funds rate fell and the calendars of new moved up, rising between Vz and 3A of a per­ corporate and municipal bond offerings light­ centage point in May, and yields on long-term ened. securities—already subject to upward pressure Measured on a quarterly-average basis, the from the heavy volume of new offerings—rose narrowly defined money stock, Ml9 expanded between 3/s and V2 of a percentage point. The at an 8.4 per cent annual rate in the second prime loan rate at commercial banks was in­ quarter, well above the 2.6 per cent rate of the creased from 7 to IV* per cent at the beginning first 3 months of 1976. The growth rates of M2 of June, but rates charged by banks on loans and M3—11.3 and 12.3 per cent, respectively to small businesses and on automobile instal­ —slightly exceeded their elevated first-quarter ment loans declined on balance during the levels, but only because of the acceleration of quarter. Mx. Growth in the other components of the The monthly growth rates of the major mon­ broader monetary aggregates moderated consid­ etary aggregates slowed in May and June, sug­ erably in the latter half of the quarter when the gesting that monetary expansion was returning higher level of market interest rates induced to a growth path generally within the long-run some investors to shift funds from savings ac­ ranges that had been specified by the System. counts at commercial banks and thrift institu- TABLE 1 Changes in selected monetary aggregates In per cent, seasonally adjusted annual rates 1975 1976 Item 1974 1975 Q3 Q4 Ql Q2 Member bank reserves: Total .................................................... 6.8 -.2 .1 .6 -3.8 .8 NOTES: Required .............................................. 7.1 -.4 -.1 -.1 -3.6 1.2 Nonborrowed ...................................... 7.6 3.2 -1.9 2.7 -3.2 .5 1M1 is currency plus private de­ mand deposits adjusted. Concepts of money calculated from:1 M2 is Mi plus bank time and Quarterly average— savings deposits adjusted other Mx .................................................... 5.0 4.4 7.1 2.3 2.6 8.4 than large CD’s. m2.................................................... 7.7 8.3 10.1 6.4 10.1 11.3 M3 is M2 plus deposits at mutual m3.................................................... 7.1 11.1 13.3 9.4 11.4 12.4 savings banks and savings and M4 .................................................... 10.6 6.5 5.7 6.7 5.7 7.1 loans and credit union shares. m5.................................................... 9.0 9.7 10.1 9.4 8.6 9.6 M4 is JVf2 plus large negotiable End-montfi of quarter— CD’s. Mx .................................................... 4.7 4.1 3.6 1.6 4.3 6.8 M5 is M3 plus large negotiable m2.................................................... 7.2 8.5 6.5 7.0 11.5 9.9 CD’s. M, .................................................... 6.8 11.3 10.7 9.3 12.6 11.4 2 Savings and loan associations, M4 .................................................... 10.6 6.4 3.0 8.4 5.0 7.6 mutual savings banks, and credit m5.................................................... 9.0 9.7 8.1 10.0 8.4 9.8 unions. 3 Total member bank deposits Time and savings deposits at: plus funds provided by Euro-dollar Commercial banks (other than borrowings and bank-related com­ large CD’s) ..................................... 10.1 11.7 12.7 9.8 15.9 13.7 mercial paper. Nonbank thrift institutions2 ................ 6.1 15.8 18.4 14.2 13.7 14.0 Note.—-Changes are calculated from the average amounts out­ Bank credit proxy, adjusted3 .................. 9.8 4.3 1.4 6.0 2.3 2.4 standing in each quarter, except where noted. The “end-month-ofquarter” changes are calculated Memo (change in billions of from the average amounts out­ dollars, seasonally adjusted): standing in the last month of each Large CD’s ......................................... 23.4 -5.3 -5.9 1.9 -6.0 -5.8 quarter. Annual rates of change in U.S. Govt, demand deposits at all reserve measures have been ad­ member banks ................................ -1.7 -.2 .5 -.7 .2 justed for changes in reserve re­ quirements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q2 1 976 653 tions into money market instruments. By mid- Changes in the income velocity of Mj and M2 July, however, inflows of savings deposits no longer appeared to be retarded by shifts of interest-sensitive funds; as a result, the interestbearing components of M2 and M3 resumed a rapid pace of expansion. MONETARY AGGREGATES AND BANK RESERVES Although the short-run behavior of the money stock is not amenable to definitive explanation, the movements of Mx during the second quarter seem to have been influenced to a considerable degree by unusual variations in the size of the Treasury’s cash balance. Most of the growth in occurred during April as the Treasury ran down its deposits at commercial banks and at the Federal Reserve by more than $7 billion (on a seasonally adjusted basis). Recipients of the Federal disbursements apparently deposited a large portion of the funds in checking accounts, temporarily building up their money balances in excess of current transactions needs. As they Data are at seasonally adjusted annual rates of growth. subsequently readjusted their asset portfolios, fluctuated in a narrow range, changing little monetary aggregates—measured on a quarterlyon balance between late April and mid-June. average basis—was only marginally above the Then, in the last weeks of the quarter, the pace of the first quarter of the year. The other Treasury’s cash balances rose sharply, and M1 component of M2—time and savings deposits, declined briefly. other than large negotiable certificates of deposit Over all, Mx grew only a little less rapidly (CD’s), at commercial banks—rose at a 13.7 than gross national product during the second per cent annual rate, as compared with 15.9 per quarter. The income velocity of —that is, cent in the first quarter. Total deposits at savings the ratio of GNP to Mx—thus rose more slowly and loan associations, mutual savings banks, than in any previous quarter of the current and credit unions, included in M3, grew at a cyclical expansion. The rise in velocity during 13.7 per cent rate in both quarters. the first year of this recovery had been excep­ During the first few months of 1976, when tionally large, reflecting in part institutional and market rates of interest on some short-term regulatory innovations that facilitated the sub­ securities fell below interest rates paid on sav­ stitution of savings deposits and other financial ings deposits, there was a massive influx of assets for demand deposits. Some reduction in funds to such accounts. The rise in market yields the rate of increase in velocity typically occurs during the second quarter apparently prompted during the second year of an economic upswing; some reversal of these rate-induced flows. Sav­ however, the ongoing changes in financial tech­ ings deposits, after expanding at a diminished nology may continue to boost the pace of ad­ pace in May, were about unchanged on a sea­ vance above that implied by past cyclical pat­ sonally adjusted basis during June. terns. The net inflow of savings and small-denomi- Despite the marked pick-up in Mx expansion nation time deposits to commercial banks during during the second quarter, growth of the broader the second quarter was, nonetheless, very strong Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

654 Federal Reserve Bulletin □ August 1976 by historical standards. With their loan portfo­ BANK CREDIT lios expanding only modestly, large banks as AND COMMERCIAL PAPER a group were therefore able to reduce still fur­ ther their CD liabilities. Some money market Total loans and investments at all commercial banks did register significant net increases in banks grew at a moderate pace in the second CD’s during late May and June, but this devel­ quarter, and the pattern of expansion was opment apparently reflected mainly positioning broadly similar to that of the first quarter. Again, for midyear financial statements; there was a most of the growth occurred in holdings of U.S. noticeable contraction of outstanding CD’s in Treasury and Federal agency issues, and large early July. The average volume of CD’s out­ banks continued to concentrate their security standing at large banks during the second quar­ TABLE 2 ter was $5.8 billion below that in the preceding 3 months, after seasonal adjustment. Rate spreads and changes in The total reserves of member banks increased business loans and commercial paper at a 0.8 per cent annual rate during the second quarter. Nonborrowed reserves expanded at a Change 0.5 per cent rate; the level of member bank borrowings from Federal Reserve Banks rose Rate In billions of dollars, spread seasonally adjusted Annual somewhat as the Federal funds rate approached Period (basis rate for points)1 total the prevailing 5V2 per cent discount rate. The Busi­ Commer­ (per ness cial Total cent) small increase in reserves was adequate to sup­ loans2 paper3 port substantial growth in the monetary aggre­ gates because the decrease in the volume of 1975— large CD’s outstanding released reserves to Q Q2 l .. 2 1 3 7 7 0 - - 2 4 . . 4 0 -1. . 5 8 - - 5 1 . . 5 6 -1 -3 1. . 1 2 support expansion of other deposits. Q3 .. 121 -1.4 -.3 -1.7 -3.5 Q4 .. 192 .3 -1.6 -1.3 -2.7 1976— Ql •• 194 -3.3 .8 -2.5 -5.3 Components of Major categories of Q2 .. 171 -1.0 1.9 .9 1.9 bank credit bank loans Apr. 194 -.9 .9 May 158 .3 .2 Vs 3.2 Change, billions of dollars June 162 -.4 .8 .4 2.6 U.S. GOVT. SECURITIES BUSINESS 16 1 Prime rate less 30- to 59-day commercial paper rate. 12 n o 2 At all commercial banks based on last-Wednesday-ofmonth data; adjusted for outstanding amounts of loans sold to affiliates. a 3 Nonfinancial company paper measured from end-of-month 4 to end-of-month. _Qi 0 REAL ESTATE OTHER SECURITIES acquisitions in coupon issues rather than n :n n shorter-dated bills. Total loans outstanding in­ CONSUMER „n ...n,„ creased only slightly, on a seasonally adjusted u . r ..-.I n.....n basis. Real estate and consumer loans expanded TOTAL LOANS substantially. However, business loans con­ tracted for the sixth consecutive quarter, bring­ J] NONBANK FINANCIAL ing the cumulative decline between December 1974 and June 1976 to $11.8 billion, or 6.4 4 “izr LT n r per cent. Net issuance of commercial paper by nonfi­ Q2 Q3 Q4 Ql Q2 Q2 Q3 Q 4 Ql Q2 nancial firms was the largest since the third 1975 1976 1975 1976 quarter of 1974. Indeed, the increase in out­ Seasonally adjusted. Total loans and business loans adjusted standing nonfinancial paper during the second for transfers between banks and their holding companies, affiliates, subsidiaries, or foreign branches. quarter exceeded the decrease in business loans Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q2 1976 655 by nearly $1 billion (seasonally adjusted). Some TABLE 3 firms that had used ample internal cash flows Net change in mortgage debt outstanding and the proceeds of capital market financings In billions of dollars, seasonally adjusted annual rates to repay short-term debt during the first year of the economic recovery again encountered a 1975 1976 need for short-term credit; with the cost advan­ Change— tage of open market financing over bank loans Q2 Q3 Q4 Qlr Q2e remaining sizable, they returned to the com­ mercial paper market. By type of debt: 46 58 70 71 73 Residential ..................... 32 40 51 54 56 Other1 ............................ 14 18 19 17 17 At selected institutions: MORTGAGE MARKET Commercial banks ............. 1 3 9 11 9 Savings and loans ............. 27 35 39 36 44 Mutual savings banks ....... 2 3 3 2 3 Deposits at savings and loan associations and Life insurance companies .. 4 2 1 3 1 FNMA-GNMA .................. 3 5 6 1 -5 mutual savings banks expanded at a seasonally adjusted annual rate of 13.9 per cent in the Memo second quarter, little changed from the 13.3 per FHLB advances to S&L’s2 -1 1 (3) -2 -2 cent rate of the preceding quarter. Deposit growth did slow, however, as the quarter pro­ 1 Includes commercial and other nonresidential as well as farm properties. gressed. Tending to moderate deposit inflows 2Quarterly totals, not seasonally adjusted. were not only the rise in market rates of interest 3Less than $500 million. ePartially estimated. but also prior efforts by some institutions to rRe vised. retard the heavy flows of funds into relatively gage commitments rose to a near-record sea­ costly term accounts. These efforts involved sonally adjusted level of about $23 billion at such measures as lowering offering rates, in­ the end of June. creasing minimum denominations, and reducing The pace of net mortgage debt formation by advertising. all lenders rose slightly further in the second quarter to a seasonally adjusted annual rate of $73 billion. As in other recent quarters, mort­ Deposits Savings and loans and mutual savings banks gage lending on 1- to 4-family homes accounted for much of the credit expansion; the multi­ Annual rate of change, per cent family and nonresidential components remained weak. The Federal and related agencies operat­ — 16 ing in the secondary market sold more mort­ gages from their portfolios than they bought, 8 while private institutions, predominantly sav­ ings and loan associations, enlarged their sup­ port to the market. __I I I 1 111 M 1 0 Q2 Q3 Q4 Ql Q2 1975 1976 Seasonally adjusted quarterly averages at annual rates. SECURITIES MARKETS The strong growth of deposits permitted sav­ Gross long-term debt and equity financing by ings and loan associations and mutual savings U.S. corporations in the second quarter pro­ banks to increase their mortgage lending while ceeded at a seasonally adjusted annual rate of maintaining a high level of liquidity. Net mort­ $55 billion, slightly above the first-quarter pace. gage debt formation at these institutions during Domestic firms continued to restructure their the second quarter was the highest in more than balance sheets in the April-June period, selling 3 years. Furthermore, their outstanding mort- new bonds at a seasonally adjusted annual rate Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

656 Federal Reserve Bulletin □ August 1976 of $40 billion, about the same volume as in the The U.S. Treasury placed smaller demands first quarter. Contributing to the large volume on the credit markets in the second quarter as of publicly offered debt securities was a record the Federal unified budget registered a modest amount of debt issued by finance companies. surplus on a seasonally unadjusted basis. Gov­ Nonprime borrowers also availed themselves of ernment expenditures were somewhat lower the public bond market in greater volume during than had been anticipated, and the Treasury cash the second quarter. Corporations issuing bonds balance rose to an unusually high level of $14.8 rated A or lower accounted for 55 per cent of billion on June 30. Net cash borrowings the quarter’s calendar—a significant increase amounted to $8.9 billion, compared with an over their 40 per cent portion of the first-quarter average of $24.5 billion in each of the preceding volume. Such firms also obtained a large volume three quarters. As part of its continuing effort of long-term funds through private placements to lengthen the average maturity of the market­ with institutional lenders. able Federal debt, the Treasury reduced the Domestic corporations continued to lower the amount of outstanding bills by $2.1 billion and ratio of their debt to equity through issuance issued $10.0 billion, net, of coupon securities of substantial amounts of stock as well as during the quarter. through retention of earnings. Common and preferred stock offerings amounted to $15 bil­ lion at a seasonally adjusted annual rate, up INTEREST RATES slightly from the first-quarter figure. This large volume reflected a record amount of issues by Yields on both short- and long-term securities manufacturing concerns and a single large issue traced broadly similar patterns over the quarter, by a communications firm. influenced to a considerable degree by shifting The volume of long-term State and local debt market expectations about future interest rate issued in the April-June period was $34 billion movements and by the less accommodative at a seasonally adjusted annual rate, a little posture in providing bank reserves that the Fed­ above the previous quarter’s $33 billion. This eral Reserve System adopted beginning in late large volume of financing appears to have re­ April. Federal funds, which had traded around flected a significant amount of financial restruc­ the 43A per cent level in the first half of April, turing by State and local units, mainly the rose over the remainder of the month and funding of short-term debt. The gross volume throughout May, reaching the 5Vz per cent level of short-term notes sold in the first half was 25 at the end of the month. The rate on Federal per cent below the pace of a year earlier. funds fluctuated around this level until early July when the System began to provide reserves TABLE 4 somewhat more freely in light of the moderation in the growth of the monetary aggregates. Offerings of new security issues Yields on other short-term private market in­ In billions of dollars, seasonally adjusted annual rates struments and on Treasury bills also moved upward by 5/s to % of a percentage point in the 1975 1976 Type of issue late April and May period, but declined again Q2 Q3 Q4 Ql Q2e in late June and early July. Yields on long-term corporate and municipal Corporate securities: total __ 61 44 48 54 55 securities, which had declined in early April, Bonds ................................ 47 35 36 40 40 Stocks ............................... 14 9 12 14 15 increased by about V2 of a percentage point until Foreign securities .................. 6 7 10 9 10 they peaked in late May. Much of this rise occurred at a time when the supply of new issues State and local govt, bonds 33 36 26 33 34 in both markets was quite large and when mar­ e Estimated. ket participants expected short-term interest Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q2 1976 657 TABLE 5 Federal Government borrowing and cash balance Quarterly totals, in billions of dollars, not seasonally adjusted 1975 1976 Item Q2 Q3 Q4 Ql Q2e Treasury financing: Budget surplus, or deficit ................... -12.0 -18.5 -26.5 -22.7 2.2 Off-budget deficit1 ............................... -2.5 -.8 -2.6 -3.7 -1.2 Net cash borrowings, or repayments (—) 16.6 23.5 25.9 24.1 9.3 Other means of financing2 .................. -1.1 -1.3 1.1 1.8 -3.5 Change in cash balance ...................... 1.0 2.0 -2.1 -.5 6.8 Federally sponsored credit agencies, net cash borrowings3 ...................... -.1 .8 2.0 .5 -2.6 includes outlays of the Export-Import Bank, Pension Ben­ 3 Includes debt of the Federal Home Loan Mortgage Cor­ efit Guaranty Corporation, Postal Service Fund, Rural Electri­ poration, Federal home loan banks, Federal land banks, Federal fication and Telephone Revolving Fund, Rural Telephone intermediate credit banks, banks for cooperatives, Federal Bank, Housing for the Elderly or Handicapped Fund, and National Mortgage Association (including discount notes and Federal Financing Bank. securities guaranteed by the Government National Mortgage 2Checks issued less checks paid, accrued items, and other Association), and farm credit banks. transactions. e Estimated. rates to increase over the remainder of the year. Yields on long-term Treasury issues and on As June progressed, prospective supply pres­ conventional mortgages moved less widely over sures eased; this, together with indications that the quarter. Treasury bond yields, paralleling the pace of monetary expansion was moderat­ corporate and municipal yields, rose about % ing, led market participants to revise their ex­ of a percentage point in the April-May period pectations, and long-term rates began to decline. before dropping about Vs of a percentage point For example, the Board’s index of yields on by the end of June. With deposit flows relatively newly-issued Aaa-rated utilities and the Bond ample at thrift institutions, home mortgage Buyer index of long-term municipal bonds reg­ rates in the primary market changed little in istered declines of about lA of a percentage point April and May and moved up only slightly in over the month of June. June. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

658 Member Bank Income in 1 9 7 5 Net income at member banks continued to in­ pense for member banks, rose moderately dur­ crease in 1975, but the rate of expansion was ing 1975. The fact that the increase was sub­ half that of the year before and was at the stantially less than in the previous year reflected slowest rate in more than a decade. The slow the efforts of many banks to trim payroll ex­ growth in earnings was the result largely of a penses. As in 1974, the largest increase in any sharp decrease in rates of return on loans, al­ noninterest category was in the provision for though other contributing factors included a loan losses. Actual net loan losses in 1975 rose deceleration in the rate of loan portfolio growth, at substantially the same high rate as in 1974, a continued increase in the provision for loan even though the rate of growth in loans out­ losses, and a drop in revenues from Federal standing declined. As a result, the ratio of net funds sold and securities purchased under resale loan charge-offs (for those banks that account agreements. Operating income and expenses for possible loan losses by the use of a reserve declined during the year compared with record account) to average loans outstanding rose to or near-record levels the two previous years. Net the highest level in any recent year. securities transactions, however, resulted in a Because of these changes, income before small gain for member banks and added to net income taxes and net securities gains and losses income for the first time in 3 years. declined nearly 1 per cent in 1975 from the year-earlier total. However, a sizable decrease in tax liabilities on current income and a small net gain in securities transactions more than SUMMARY offset this decline, and so net after-tax income Operating income at member banks decreased of member banks reached $5,545 million—3.4 almost 5 per cent in 1975, after having risen per cent more than in 1974. at rapid rates in 1973 and 1974. The decline The ratio of net income to equity capital plus was largely the result of a substantial drop in reserves at member banks declined in 1975 to interest income on loans caused by sharply a level below that of several recent years. As reduced rates of return on loans and a negligible in 1974, however, cash dividends declared rose growth in loan volume. Interest income on in­ faster than net income, thus causing an increase vestments, however, rose rapidly in 1975 as the in the ratio of cash dividends declared to net rapid growth in holdings was accompanied by income. a modest increase in rates of return. Large member banks in New York, Chicago, All noninterest categories of expenses in­ and other major cities recorded roughly equal creased in 1975, but the increases were gener­ rates of increase in net income during 1975. For ally less than in 1974. Salaries and wages, these groups the increase was slightly higher which represent the second largest single ex- than for all member banks and significantly greater than for smaller member banks, which posted only a negligible increase in net income during 1975. For all groups, however, the rates Note.—This article was prepared by Anthony W. of increase in 1975 were substantially less than Cyrnak of the Board’s Division of Research and Statis­ tics. those in 1974. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Member Bank Income in 1975 659 OPERATING INCOME income derived from the amount of Federal After having increased at a record pace in 1973 funds sold and securities purchased under resale and at a near-record rate in 1974, total operating agreements. As a result, interest income on income at member banks declined in 1975. loans fell as a proportion of total operating Operating revenues totaled $51,356 million, revenue. Revenue from investment activities, down $2,472 million, or 4.6 per cent, from however, accounted for a larger proportion of 1974 (Table 1). In recent years large gains in operating income in 1975 than in 1974. revenues had been attributable to rapid increases Interest and fees on loans (including Federal in interest and fees on loans. In contrast, there funds sold and securities purchased under was a dramatic decline in such income during agreements to resell) declined $5,323 million, 1975. Similarly, there was a sharp drop in or 13.1 per cent, in 1975 after having increased TABLE 1 Consolidated report of income for 1971-75 for all member banks Amounts shown in millions of dollars Amount Change, 1974-75 Item Amount Percent­ 1971 1972 1973 1974 1975 age Operating income—Total ............................................................. 28,670 31,335 41,708 53,828 51,356 -2,472 -4.6 Loans: Interest and fees ......................................................................... 18,317 19,997 28,261 38,055 33,739 -4,316 -11.3 Federal funds sold and securities purchased under resale agreement ............................................................. 677 794 1,847 2,722 1,715 -1,007 -37.0 Securities (excluding trading account income) Total: .............................................................................. 5,662 6,086 6,531 7,237 8,558 1,321 18.3 U.S. Treasury securities ......................................................... 2,434 2,412 2,392 2,343 3,165 822 35.1 U.S. Govt, agencies and corporations ............................. 578 730 943 1,268 1,463 195 15.4 States and political subdivisions ......................................... 2,468 2,709 2,927 3,301 3,576 275 8.3 Other securities ............................................................................ 182 234 268 325 354 29 8.9 Trust department ............................................................................. 1,182 1,269 1,344 1,379 1,457 78 5.7 Service charges on deposit accounts ..................................... 896 904 940 1,022 1,086 64 6.3 Other charges, fees, etc.................................................................. 795 864 998 1,151 1,359 208 18.1 Other operating income: On trading account (net) ........................................................ 340 254 338 425 497 72 16.9 Other ............................................................................................... 802 1,168 1,449 1,836 2,945 1,109 60.4 Operating expenses—Total .......................................................... 23,346 25,639 35,027 46,806 44,398 -2,408 -5.1 Salaries and wages of officers and employees ................. 5,666 6,020 6,571 7,426 8,061 635 8.6 Officers and employee benefits ................................................. 973 1,073 1,234 1,406 1,560 154 11.0 Interest on: Time and savings deposits .................................................... 9,426 10,513 15,377 21,806 19,794 -2,012 -9.2 Federal funds purchased and securities sold under repurchase agreements ..................................... 1,073 1,387 3,765 5,714 3,151 -2,563 -44.9 Other borrowed money ............................................................ 127 102 474 872 336 -536 -61.5 Capital notes and debentures ................................................. 123 184 204 217 228 11 5.1 Net occupancy expense ................................................................ 1,130 1,259 1,408 1,603 1,791 188 11.7 Furniture, equipment, etc............................................................... 797 848 924 1,036 1,154 118 11.4 Provision for loan losses ............................................................ 681 767 994 1,857 3,050 1,193 64.2 Other operating expenses ............................................................ 3,348 3,486 4,078 4,869 5,273 404 8.3 Income before income taxes and securities gains or losses 5,325 5,696 6,681 7,021 6,957 -64 -.9 Applicable income taxes .............................................................. 1,349 1,356 1,654 1,591 1,453 -138 -8.7 Income before securities gains or losses ............................. 3,976 4,340 5,027 5,431 5,505 74 1.4 Net securities gains or losses (—) after taxes ................... 144 46 - 30 - 69 17 Extraordinary charges (—) or credits after taxes .............. - 3 14 15 3 24 21 Less minority interest in consolidated subsidiaries .......... O O O O O C) O Net income ............................................................................................. 4,117 4,400 5,012 5,364 5,545 181 3.4 Cash dividends declared2 .................................................................. 1,908 1,839 2,018 2,270 2,476 206 9.1 ^ess than $500,000. 2On common and preferred stock. Note.—Figures may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

660 Federal Reserve Bulletin □ August 1976 sharply in both 1974 and 1973. The decline was 1975. For the year, the average rate of return attributable to several factors. Generally lower on loans fell nearly IV2 percentage points to interest rates, for example, resulted in a signifi­ 8.44 per cent—after having risen by nearly the cantly lower average return on all loans during same amount in 1974. The drop in the average interest rate earned on Federal funds sold was even more dramatic—more than 4Vi percentage TABLE 2 points, the largest decline in recent years. Loan revenues were further dampened in 1975 by the Changes in average loans, effects of nonaccrual loans and by loans rene­ investments, deposits, and gotiated at reduced rates, particularly loans to capital outstanding of member banks real estate investment trusts. Amounts shown in million of dollars Perhaps the most important influence limiting the growth in interest income during 1975, Average amount1 Change however, was the lack of strong growth in average loans outstanding. For the year, the Item Per­ average1 for total loans rose only $7.7 billion, 1974 1975 Amount centage or 1.9 per cent, in contrast to the increase of Total loans and invest­ $51.3 billion, or 14.2 per cent, recorded in ments, gross2 ...... 549,348 570,162 20,814 3.8 1974. Loans outstanding in nearly every cate­ Total average loans outstanding __.... 412,202 419,857 7,655 1.9 gory increased less than in 1974. Commercial Federal funds sold and securities purchased and industrial loans account for more than a under resale agree­ third of total outstanding loans at member ment .................... 27,114 29,307 2,193 8.1 Other loans .................. 385,088 390,550 5,462 1.4 banks, and they increased only 2.2 per cent in Commercial and industrial ............... 146,633 149,837 3,204 2.2 1975—far below the 17.7 per cent rise posted Agricultural ............. 10,539 10.838 299 2.8 in 1974. Real estate ............... 91,228 95,012 3,784 4.1 For purchasing and The contraction effect of the recession in early carrying securities 9,424 9,041 -383 -4.1 To financial 1975 and the liquidation and then modest institutions ............ 41,226 39,647 -1,579 -3.8 Other loans to growth of inventories translated into a decline individuals ............ 73,951 74,267 316 .4 in the outstanding volume of loans to the com­ All other .................. 12,088 11,908 -180 -1.5 U.S. Treasury securities3 36,672 47,254 10,582 28.9 mercial and industrial sector until late in the U.S. Govt, agency year. Businesses in the aggregate continued to and corporation issue a large volume of long-term debt and securities3 ............. 18,767 20,093 1,326 7.1 States and political sub­ equities, repaying bank loans in order to re­ division securities3 . 69,993 71,914 1,921 2.7 Other securities3 .......... 4,125 4,634 509 12.3 structure their balance sheets and improve their Trading account securities ............... 7,589 6,411 1,178 15.5 liquidity positions. This financial policy was enhanced by sharply improved cash flows rela­ Total deposits ............... 550,145 580,159 30,014 5.5 Time deposits ............... 305,620 332,390 26,770 8.8 tive to capital outlays. Bank loan policies re­ Savings ..................... 95,935 106,950 11,019 11.5 Other time I.P.C........ 157,161 168,374 11,213 7.1 mained cautious with loan rates high relative All other time .......... 52,524 57,067 4,543 8.6 to market rates and with nonprice terms and Equity capital4 ............. 43,252 46,729 3,477 8.0 conditions tending to emphasize loan quality as Total capital accounts5 46,644 50,190 3,546 7.6 Reserves on loans banks sought to improve their own financial and securities ....... 6,680 7,226 546 8.2 Total equity capital positions. and reserves ......... 49,933 53,955 4,022 8.1 Real estate loans of member banks rose by only $3.8 billion, or 4.1 per cent, during 1975. 1 Average of figures for three call dates—the end of the preceding year and the June 30 and December 31 call dates However, this increase in loans for real estate for the calendar year. 2Includes securities held in trading account. 3Excludes securities held in trading account. 4Includes common stock, preferred stock, surplus, undivided 1Average of loans outstanding for three call dates— profits, and reserves for contingency and other capital reserves. the end of the preceding year and the June 30 and 5Includes equity capital plus capital notes and debentures. December 31 call dates for the calendar year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Member Bank Income in 1975 661 TABLE 3 rising by 28.9 per cent. This sharp increase, coupled with a rise of 30 basis points in the Selected member bank income ratios rate of return on these securities, boosted reve­ In per cent nue from this source by 35.1 per cent to $3,165 million. This was in sharp contrast to 1974, a Ratios 1971 1972 1973 1974 1975 year in which holdings fell by 11 per cent and Ratios to equity capital revenue fell by 2 per cent. Investment in other (including reserves)— Income before securi­ types of securities also increased in 1975, but ties gains or losses. 10.22 10.38 11.00 10.88 10.20 neither the gain in volume nor the increase in Net income ............... 10.60 10.54 10.97 10.75 10.27 Cash dividends revenue was so large as in 1974. declared1 ............... 4.91 4.40 4.41 4.55 4.58 Aggregate revenue from trust departments, Rates of return on— service charges on deposit accounts, and other Loans, gross ............ 7.18 6.90 8.34 9.90 8.44 U.S. Treasury charges and fees increased $350 million, or 9.9 securities2 ............. 5.61 5.41 5.80 6.39 6.69 U.S. Govt, agencies per cent—slightly more than in 1974. “Other and corporations2 .. 6.20 6.08 6.20 6.76 7.28 operating income,” which includes net income State and local govt. obligations2 .......... 4.17 4.11 4.31 4.72 4.97 from the trading account, foreign branches, and Other securities2 ...... 7.10 6.67 6.89 7.88 7.63 Edge Act subsidiaries, rose $1,181 million, or Interest on time deposits to total time deposits 4.77 4.61 5.82 7.14 5.95 52.2 per cent. This increase compares with one of 26.5 per cent in 1974 and reflects a continu­ xOn common and preferred stock. ation in the trend toward a greater volume of 2Excludes securities held in trading account. Note.—These ratios were computed from aggregate dollar overseas business at many member banks. As amounts of income and expense items. The capital, deposits, in other years, the largest member banks (espe­ loans, and securities items on which the ratios were based were averages for two call dates in the calendar year and the last cially those in New York and Chicago) have call date in the preceding year. been most involved in this overseas expansion. In 1975 these large banks found international banking a profitable activity as loan demand activities accounted for a much larger proportion increased substantially above 1974 levels and of total loan growth in 1975 than in 1974— interest spreads widened. about half of the total in contrast to one-fifth in 1974. Consumer loans too were depressed in response to adverse economic conditions OPERATING EXPENSES in 1975; they rose less than 1 per cent dur­ ing the year. This was in marked contrast to Operating expenses at member banks during the 7.4 per cent growth rate posted in 1974. 1975 declined significantly, after having in­ Loans for purchasing and carrying securities creased at a near-record rate in 1974. This declined for the second consecutive year, al­ decrease reflected both a sharp decline in nearly though the $383 million, or 4.1 per cent, decline every category of interest expense and a slower in 1975 was significantly less than the 23.8 per rate of growth in noninterest expenses relative cent decrease recorded in the previous year. to 1974. The lack of strong loan demand, together with Interest paid on time and savings deposits— sizable deposit inflows, permitted member which generally comprises about two-fifths or banks to invest more heavily in securities during more of total operating expenses—declined in 1975 than in 1974. For the year, average hold­ 1975 to $19,794 million, a drop of 9.2 per cent. ings of securities by member banks increased Contributing strongly to this decline was a sharp 11.3 per cent as compared with only 2.1 per decrease in the average rate paid on such de­ cent in 1974. As a result, revenue from this posits. During 1975 the average rate paid on source increased by $1,321 million, or 18.3 per time and savings deposits declined 119 basis cent. Acquisitions of U.S. Treasury securities points after having risen rapidly in 1974. This were particularly large, with average holdings drop reflected both a reduction in offering rates Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

662 Federal Reserve Bulletin □ August 1976 associated with the decline in yields on Treasury For the second consecutive year member bills and other market outlets for savings and banks raised their provision for loan losses by a shift in the composition of interest-bearing a large amount; provisions for the year totaled deposits at commercial banks. During the year, $3,050 million, an increase of $1,193 million, relatively low-cost savings deposits increased by or 64.2 per cent. This rate, which was much 11.5 per cent while time deposits rose by only larger than the 1.9 per cent growth rate of total 7.5 per cent. In view of the relative strength average loans outstanding, reflected the neces­ of savings deposit inflows, member banks were sity for many member banks to bolster loan loss able to reduce their reliance on purchased funds reserves in response to the adverse economic such as large certificates of deposit. This is in conditions. For banks that operate on a loan-loss marked contrast to 1974, a year in which mem­ reserve-accounting basis, which includes all ber banks issued large quantities of such time larger banks and many smaller ones, the current deposits. In addition, the over-all decline in provision for loan losses generally is the esti­ short-term interest rates also made CD’s a much mated amount needed to bring the reserve for cheaper source of funds in 1975 than in 1974 loan losses to a level sufficient to absorb ex­ for those banks that found it necessary to pur­ pected losses on the existing loan portfolio. For chase funds to finance their portfolios. accounting purposes, this item is considered to Interest paid for Federal funds purchased and be an operating expense affecting net income securities sold under repurchase agreements fell in the current year. Although the minimum dramatically in 1975. For the year this operating amount that a bank must provide each year for expense declined $2,563 million, or 44.9 per such purposes is determined by methods pre­ cent, and reflected both a slower increase in scribed by supervisory authorities,2 bank man­ volume than in 1974 and a precipitous decline agement may designate a larger-than-required in the average rate paid for such funds. In 1975, provision if such action is advisable under pre­ for example, the volume of Federal funds sold vailing economic conditions. increased 8.1 per cent compared with 23.6 per Numerous member banks made such cent in the previous year. Similarly, the average “excess” provisions during 1975 in order to rate paid for these funds in 1975 was 5.82 per offset the effects of loan-loss charge-offs, which cent, or 469 basis points less than in 1974. increased 71.6 per cent to $2,731 million. This Interest paid on “other borrowed money,” increase in net loan charge-offs was much faster which includes interest costs on Euro-dollar than the growth of loans; hence it caused the borrowings and on loans from Federal Reserve ratio of net loan charge-offs to average loans Banks, also declined sharply in 1975. During outstanding to increase from 0.39 per cent in the year, expenses from such borrowings de­ 1974 to 0.65 per cent in 1975—the highest level clined 61.5 per cent after having risen 84.0 per recorded in any recent year. Nonetheless, actual cent in 1974, as both the volume of borrowing provisions for loan losses exceeded net loan and average rates paid declined. Interest costs charge-offs by $319 million in 1975 and in­ associated with outstanding capital notes and creased total loan loss reserves by 3.6 per cent. debentures, the only interest expense category As a result of the changes, the ratio of reserves to increase in 1975, continued to grow at about for losses to average loans outstanding increased the same pace as in 1974. slightly in 1975, from 1.69 per cent to 1.71 Salaries and wages (including benefits) at per cent. member banks continued to rise in 1975, but Other minor operating expenses such as net the increase was somewhat less than in 1974 occupancy expense, furniture and equipment and it reflected an effort on the part of many banks to “hold the line” on payroll expenses. 2A11 member banks that do not provide for loan losses For the year such expenditures increased $789 on a reserve basis must use their actual net loan losses each year as a minimum “provision for loan losses.” million or 8.9 per cent, in contrast to a 13.2 Other banks may use this method if they do so on a per cent increase during 1974. regular basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Member Bank Income in 1975 663 expense, and other expenses all rose slightly less OTHER TRANSACTIONS than in 1974 and reflected both cost-cutting measures taken by banks during 1975 and lower After recording net losses on securities transac­ expenses associated with reductions on Euro­ tions for two consecutive years, member banks dollar borrowing, which some banks report in posted a small net gain in 1975. Their earnings this item. on such transactions totaled $17 million. Ex- TABLE 4 Consolidated report of income for 1975 and 1974 for member banks grouped by class In millions of dollars Large banks All member All other banks banks Item New York City City of Chicago Other 1975 1974 1975 1974 1975 1974 1975 1974 1975 1974 Operating income—Total ............................... 51,35653,828 9,375 10,299 2,725 3,21619,399 20,925 19,85619,388 Loans: Interest and fees ........................................ 33,739 38,055 6,201 7,840 1,880 2,469 12,876 14,959 12,782 12,787 Federal funds sold and securities purchased under resale agreement ...................... 1,715 2,722 103 184 86 148 815 1,216 711 1,174 Securities: Excluding trading-account income: U.S. Treasury securities ........................ 3,165 2,343 415 278 145 90 1,052 722 1,554 1,253 U.S. Govt, agencies and corporations .. 1,463 1,268 107 97 46 52 416 352 894 767 States and political subdivisions ............ 3,576 3,301 400 362 136 132 1,156 1,124 1,885 1,683 Other securities ..................................... 354 325 43 45 14 14 89 115 207 152 Trust department ...................................... 1,457 1,379 393 390 116 108 587 549 361 332 Service charges on deposit accounts ......... 1,086 1,023 86 80 26 19 405 383 569 541 Other charges, fees, etc.............................. 1,359 1,151 232 149 59 49 619 557 449 396 Other operating income: On trading account (net) ...................... 497 425 168 166 77 26. 231 219 21 14 Other ..................................................... 2,945 1,836 1,228 708 140 109 1,152 729 424 290 Operating expenses—Total ............................ 44,39846,806 7,864 8,817 2,298 2,81816,96418,56217,27216,609 Salaries and wages of officers and employees 8,061 7,426 1,318 1,184 295 270i 3,073 2,855 3,374 3,117 Officer and employee benefits ...................... 1,560 1,406 342 290 65 56 556 515 597 545 Interest on: Time and savings deposits ........................ 19,794 21,806 3,062 3,997 1,080 1,397 7,284 8,228 8,368 8,184 Federal funds purchased and securities sold under repurchase agreements ............ 3,151 5,714 792 1,264 370 690' 1,543 2,982 445 778 Other borrowed money ............................. 336 872 126 367 8 22 163 392 38 91 Capital notes and debentures ..................... 228 217 48 42 6 4 107 106 67 66 Net occupancy expense ................................ 1,791 1,603 341 314 65 57 652 584 734 647 Furniture, equipment, etc............................... 1,154 1,036 137 122 42 35 426 388 549 492 Provision for loan losses .............................. 3,050 1,857 981 516 196 80' 1,151 733 722 529 Other operating expenses ............................. 5,273 4,869 716 723 172 207 2,009 1,779 2,377 2,160 Income before income taxes and securities gains or losses .................................. 6,957 7,021 1,511 1,482 427 397 2,435 2,363 2,584 2,779 Applicable income taxes .......................... 1,453 1,591 386 390 130 114 580 555 357 532 Income before securities gains or losses ... 5,505 5,431 1,125 1,093 298 284 1,855 1,808 2,228 2,246 Net securities gains or losses (—) after taxes 17 -69 16 -17 -4 -4 -8 -29 13 -20 Extraordinary charges (—) or credits after taxes .................................................. 24 3 -1 16 -7 9 10 Less minority interest in consolidated subsidiaries ........................................ O C1) O O o o o o O Net income .................................................... 5,545 5,364 1,140 1,076 294 280 1,863 1,772 2,249 2,237 Cash dividends declared ............................... 2,475 2,270 503 454 133 132 978 852 862 832 Ratios (per cent) to equity capital (includ­ ing reserves): Income (after taxes) before securities gains or losses .................................. 10.20 10.89 10.53 11.17 11.25 11.60 10.06 10.60 10.03 10.89 Net income ........................................... 10.27 10.75 10.67 11.00 11.09 11.43 10.11 10.39 10.12 10.85 1Less than $500,000. Note.—Figures may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

664 Federal Reserve Bulletin □ August 1976 traordinary charges or credits after taxes also decline had been a more moderate one-fifth of had a favorable impact on net earnings—adding a percentage point. $24 million to net income—after having had a The increase in cash dividends at member negligible effect during 1974. banks during 1975 was somewhat less than in 1974—9.1 per cent compared with 12.5 per cent. However, this rate of increase was still nearly three times as large as the increase in INCOME TAXES net income in 1975, and it boosted the ratio Applicable income taxes at member banks de­ of cash dividends declared to net income from clined 8.7 per cent, or $138 million, in 1975. 42.3 per cent in 1974 to 44.7 per cent in 1975. This decline, which was about twice as large as that in 1974, reflected not only the decline in before-tax income but also the increased NET INCOME proportion of that income derived from tax-ex- BY CATEGORY OF BANK empt sources. Large banks in New York City recorded the most rapid increase in net income of any cate­ gory of member banks. However, the 5.9 per NET INCOME cent increase for this group—which accounts for AND CASH DIVIDENDS a fifth of all member bank income—was only Reflecting all of the above changes, net income slightly higher than for large banks in Chicago, at member banks in 1975 increased $181 mil­ which posted a 5.0 per cent gain. This was in lion, or 3.4 per cent—the smallest gain in a contrast to 1974 when the performance dif­ number of years. Equity capital plus reserves, ference between these two groups had been however, increased at more than twice that rate somewhat larger. “Other” large banks also during 1975, and as a result the ratio of net increased their net income at about the same income to equity capital plus reserves declined rate—5.1 per cent during 1975. As in 1974 net for the second consecutive year. For the year income of “all other” member banks increased this ratio declined about half of a percentage only slightly. For this group, such income rose point to 10.27 per cent, whereas in 1974 the only $12 million, or 0.5 per cent. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

665 The Federal Reserve System’s Equal Employment Opportunity Program A Progress Report for the Period 1971 Through 1975 Equal employment opportunity is a key ele­ employees promoted into the professional or ment in the personnel policies of the Federal high-level technical ranks are a target for other Reserve System. The System’s equal employ­ employers. ment opportunity (EEO) program is of national The Federal Reserve System’s espousal of significance in terms of the number of people nondiscriminatory personnel manage­ affected, the number of policy-formulating jobs ment—employment and promotion based on to be filled, the involvement of all geographic merit—has long been regarded as a part of its sections of the country, and the availability of general outlook as a public service organization. jobs for women and minorities. Board statements calling for the abandonment This article provides a progress report on of personnel actions based on considerations of results of the System’s equal employment op­ race, color, religion, or national origin date back portunity program over the past 4 years. many years before formalization of nondiscrim­ At the end of 1975 the System employed inatory employment practices was required by some 28,000 people. These people were em­ the Civil Rights Act of 1964 and Executive ployed—in categories ranging from manual Orders 11246 and 11478 implementing such labor to policy formulation—in Washington, rules in Federal employment policy. Later ac­ D.C., in the 12 Federal Reserve Bank cities, tions of the Federal Government extended this and in 35 other cities across the country. There policy’s reach by introducing requirements that is no part of the Federal Reserve System’s employers prepare and implement written professional or technical work that cannot be Affirmative Action Plans. performed equally well by women or men or The Federal Reserve Board has kept in step by persons of any race or cultural background, with these moves, formalizing and extending the given personal aptitude and the necessary edu­ basic equal employment objectives that had long cation or training. been a part of the System’s employment philos­ This report on the System’s progress toward ophy. To focus efforts on the achievement of complete equality of opportunity in employ­ stated equal employment opportunity affirmative ment, therefore, may have some special signifi­ action goals, the Board in 1969 adopted a Tencance as a profile of a large employer, operating Point Plan. This called, inter alia, for the des­ nationwide under a single set of guidelines and ignation at each Federal Reserve Bank of a conditions in which equality of opportunity is senior officer to head the Bank’s Equal Em­ limited only by the availability of persons with ployment Opportunity office, and to make regu­ the necessary aptitudes and preparation. One lar reports to the President or First Vice Pres­ further factor is a limitation, not on equality of ident of the Bank on efforts being made by the opportunity, but on results in the form of numer­ Bank to achieve the objectives of the Plan and ical improvements. The Federal Reserve Sys­ on the results achieved. In adopting the Tentem is regarded as an employer that gives a high Point Plan the Board recognized that achieve­ level of training and requires a high level of ments under the Plan were a priority matter and performance. The System, consequently, has an gave the Reserve Banks authority to incur addi­ Alice in Wonderland problem: it must run to tional costs to that end. even stay in place because minority or female The written Affirmative Action Plan, with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

666 Federal Reserve Bulletin □ August 1976 annual revisions, is the basic element in an During the 4-year period 1971-75 over-all equal employment opportunity program. To be employment in the Federal Reserve System in­ effective the plan must address the question of creased from 23,746 to 28,130. This repre­ the representation of minorities and women at sented a gain of 18.5 per cent. In 1971, women all levels of employment in the organization. employees numbered 12,838, or 54.1 per cent Further, it must identify any deficiencies in of the total System employment. In 1975 they personnel management that tend to inhibit the had increased to 15,346, or 54.6 per cent of hiring and progress of women and minorities. the total. During the same 4-year period minor­ Numerical goals and timetables are established ity employment—which overlaps female em­ by which achievement can be measured. The ployment—increased from 5,171 to 7,419, a aim is a constantly improving “EEO profile,” gain of 43.5 per cent. Thus, the rate of increase that is, a measurable improvement in the partic­ in over-all minority employment was nearly 2Vi ipation of minorities and women in an organi­ times greater than the over-all increase in Sys­ zation’s employment and promotion pattern, tem employment. At the close of 1971, minority and the distribution of minorities and women employees represented 21.7 per cent of total in all employment grades. This is the basic employment; by the end of 1975 they had in­ nature of the EEO programs now being imple­ creased to 26.4 per cent of the total. mented by the Board and the 12 Federal Reserve The breakdown of the 4-year gain in minority Banks. group employment covered the following racial To monitor and strengthen the System’s EEO groupings, including women employees in these efforts, the Board in 1971 established an Equal groups: Black, Oriental, American Indian, and Opportunity Office and gave officer status to its Hispanic. The distribution of these groupings head. In 1972 the Board instituted an annual in the System for 1971 and 1975 by number comprehensive year-end survey of Federal Re­ and the percentage gains for each are shown serve System employment, with detailed break­ in the accompanying table. downs by sex, minority group, and Federal Reserve (FR) grade level. Additional statistics Percentage Racial grouping 1971 1975 increase cover accessions and separations. The data that follow are taken from the annual Black ..................... 4,174 5,844 40.0 surveys of System employment in the 4-year Oriental .................. 272 500 83.8 American Indian __ 21 36 71.4 period from December 31, 1971, through De­ Hispanic ................ 704 1,039 47.6 cember 31, 1975. The most significant progress toward improved nondiscriminatory employ­ In 1971 the minority distribution by sex was ment is increased representation of women and 2,040 men and 3,131 women; in 1975 the minorities in higher grades—FR-9 and above, figures were 2,826 and 4,593, respectively. This where professional and high-level technical em­ accounted for gains of 38.5 per cent for minority ployment with significant policy-formulation men and 46.7 per cent for minority women. As impact occurs. Thus, the data excerpted from a result, minority women increased their per­ the annual surveys concludes by focusing on centage of all women System employees from changes in System employment of women and 24.4 per cent in 1971 to 29.9 per cent in 1975. minorities at these levels. The FR-9 and above During the 4 years, System assignments in the assignments include the professional, manage­ critical FR-9 and above grades increased from rial, supervisory, and official staff positions that 6,522 to 9,343. This was a gain of 43.3 per are comparable to the Federal Civil Service cent. For all men employees in this category, General Schedule (GS) assignments through the the advance was from 5,160 to 6,874 or 33.2 super grade level. They cover the positions in per cent. For all women employees the advance which minorities and women have traditionally was from 1,362 to 2,469 or 81.3 per cent, more been underrepresented. than double the percentage gain for men. These Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Equal Employment Opportunity Program 667 Percentage Per cent of total Employee group 1971 1975 increase 1971 1975 All employees ........................ 6,522 9,343 43.3 100.0 100.0 of which: Men ................................... 5,160 6,874 33.2 79.1 73.6 Women ............................... 1,362 2,469 81.3 20.9 26.4 Non-minority employees ....... 6,208 8,446 36.1 95.2 90.4 of which: Men ................................... 4,929 6,259 27.0 79.4 74.1 Women ............................... 1,279 2,187 71.0 20.6 25.9 Minority employees ............... 314 897 186.0 4.8 9.6 of which: Men ................................... 241 615 155.0 76.8 68.6 Women ............................... 73 282 288.0 23.2 31.4 developments moved the percentage of women bution of System personnel FR-9 and above by employees in the professional-managerial levels sex and minority group for December 31, 1971, from 20.9 per cent of all System employees in and December 31, 1975. 1971 to 26.4 per cent in 1975. In the officer Further analyses of the 4-year employment category only, the increase for women was data for both the Board and individual Reserve from 17 in 1971, representing 2.6 per cent of Banks show that progress in equality of em­ the total of 659 officers, to 40 or 5.1 per cent ployment opportunity has been rather uniform of the total of 778 officers in 1975. throughout the nationwide System. This is due For minority employees in the professional- in large measure to the uniform and advanced managerial levels, the increase was from 314 criteria for the Affirmative Action Plan laid down to 897—a gain of 186 per cent during the 4-year for the System by the Board and shows close period, or more than four times the over-all adherence to it by all Banks and by the Board. increase of System employment in these grades. This adherence, coupled with the System’s pro­ Minority representation thus moved from 4.8 gram accountability provisions and comprehen­ per cent of the highest levels of System em­ sive evaluation procedures, should insure con­ ployment in 1971 to 9.6 in 1975. During the tinued evenness within the System in moving same period, minority officers increased from to full equality of opportunity for advancement 4 to 15, constituting 1.9 per cent of the System for every System employee and equality of officer category at the end of 1975. opportunity for employment for every applicant The accompanying table shows the distri­ for a job in the System. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

668 Statements to Congress Statement by Arthur F. Burns, Chairman, of the economy have returned to more efficient Board of Governors of the Federal Reserve levels of operation. System, before the Committee on Banking, In a typical business cycle, the rate of growth Currency, and Housing, U.S. House of Repre­ of economic activity slows after the first year sentatives, July 27, 1976. of recovery. Thus, during the past five cyclical upswings, the physical volume of the Nation’s I am pleased to meet once again with the House total production rose, on average, by 8 per cent Banking Committee to present the report of the in the first year and 4 per cent in the second. Board of Governors of the Federal Reserve This tendency for the pace of expansion to System on the condition of the national econ­ diminish during the second year often reflects omy and the course of monetary policy. a reduced stimulus from rebuilding of invento­ The economic expansion now under way is ries. well into its second year. By any reasonable In the current recovery, too, the rate of eco­ yardstick, the Nation’s economy has experi­ nomic expansion has been influenced by the enced a substantial recovery. In the quarter just pace of inventory investment. Between the sec­ ended, the physical volume of total production ond quarter of last year and the first quarter of was 8V2 per cent above its trough in the first this year, the shift from extensive liquidation quarter of 1975. The rebound of activity in the of inventories to moderate accumulation ac­ industrial sector has been especially vigorous; counted for about 45 per cent of the increase the combined output of our factories, mines, and in the physical volume of production. But in power plants has risen more than 16 per cent the quarter just ended, if preliminary estimates since March of last year. hold up, inventory investment no longer added The expansion of economic activity in the to the growth of physical output. service trades as well as in the industrial sector In consequence, the real gross national prod­ has led to material strengthening in the demand uct appears to have expanded at an annual rate for labor. Total employment across the Nation of AV2 per cent in the second quarter of this has risen about 3V2 million from its low in year, compared with 8 per cent over the pre­ March 1975 and is now IV4 million above the ceding three quarters. Growth of industrial out­ previous peak. The average length of the factory put also decelerated, particularly in industries workweek has also risen, and the unemployment producing nondurable goods. And while condi­ rate has declined from about 9 per cent to 7Vi tions in labor markets continued to improve in per cent in the face of rapid growth of the labor the second quarter, they did so to a lesser force. degree. Total employment, which increased 1.3 These gains in production and employment million during the first 3 months of this year, have been accompanied by larger personal in­ rose 800,000 in the next 3 months. And the comes and rising consumer purchasing power. unemployment rate, which fell materially be­ The average level of disposable income per tween December and March, has changed little capita has risen in real terms by 6V2 per cent over the ensuing months. since early 1975, and last quarter it was IV2 The recent slowdown in the rate of economic per cent above its previous peak. Business expansion has resulted not only from inventory profits, too, have rebounded as the workshops adjustments—a pause in consumer spending Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 669 also played a part in this development. After tories in some nondurable goods industries have a rapid advance from last December through this been restored to levels that are adequate to meet March, retail sales grew slowly in April and current rates of sales, renewed accumulation of then declined in May. Temporary pauses of this inventories in the durable goods sector is just kind are not uncommon during periods of cycli­ beginning. Total new orders received by pro­ cal expansion. Indeed, recent sales figures sug­ ducers of durable goods are now rising sharply, gest that a resumption of the upward trend is and rebuilding of their stocks should be a stim­ already under way. Retail sales rose nearly 3 ulus to production in the months ahead. per cent in June, and there were encouraging A revival of homebuilding activity has been gains across the range of nondurable goods— contributing to general economic expansion where sales had lagged in April and May. since the spring of 1975. New housing starts We may reasonably expect further good gains rose 4 per cent further last month, as the number in retail trade in the months ahead. The basic of single-family housing starts advanced to the determinants of consumer spending are clearly level of 3 years ago. favorable: real incomes of families are increas­ Weakness in the multifamily sector, however, ing, labor market conditions are improving, and has limited the over-all improvement of resi­ so too is the liquidity position of consumers. dential building activity. Construction of apart­ Furthermore, as optimism continues to spread, ment houses has been held down by previous consumer expenditures will tend to rise more overbuilding, lagging rents, and high con­ rapidly than the disposable income of con­ struction costs. In fact, inflated costs—of con­ sumers. As the recovery proceeds, consumer struction, maintenance, and operation—have buying will in all likelihood remain a major become a significant limiting factor for all source of strength in the economy. branches of residential construction. Never­ A larger and more basic source of stimulus theless, some signs of improvement have re­ to economic activity can be expected from cently emerged even in the multifamily sector; business outlays for new plants, machinery, and in particular, vacancy rates for rental units have other equipment. Business capital spending declined to the lowest level since 1972. With typically joins the recovery process later than mortgage credit in ample supply in practically other sectors of the economy. But as utilization all parts of the country, a gradual further ad­ of capacity increases and profits improve, busi­ vance in homebuilding activity is likely in the ness firms typically move ahead more aggres­ months immediately ahead. sively with their capital expenditure programs. Our trade balance with other countries may Although such a development has been some­ also show some improvement in coming what delayed in the present instance, the tradi­ months. Imports of industrial supplies and con­ tional pattern is again emerging. sumer goods will move up further as the expan­ Thus, production of business equipment has sion of our economy continues to cumulate. But been rising briskly since late last year. Other the outlook for our export trade is also bright­ indicators of business capital spending are also ening. Although economic recovery in other pointing upward. New orders for nondefense industrial countries began later than in our own, capital goods have risen in each of the past 6 the pace of expansion in Western Europe and months and in June were 18 per cent above their Japan has begun to gather momentum. Material level at the end of 1975. Also, the most recent strengthening of demands for American ma­ surveys of business anticipations indicate some chinery and other products is therefore to be further strengthening of plans for capital expen­ expected. ditures this year. Activity in all major sectors of the private A rising level of outlays for plant and equip­ economy thus seems poised for further ad­ ment creates a need for larger inventories of vances. Fortunately, the recovery process has materials, component parts, and other supplies thus far been well balanced, and the state of in the durable goods trades. Thus, while inven­ confidence has been steadily gaining. There Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

670 Federal Reserve Bulletin □ August 1976 have been few signs of the speculative excesses system has been further strengthened through that often develop in the course of a business- widespread additions to retained earnings and cycle expansion. Consumer attitudes toward some new issues of common stock. The ratio buying durable goods and homes have of late of capital to risk assets of commercial banks, further improved, and conditions in financial which declined .steadily during the early 1970’s, markets remain favorable for continuance of has thus increased appreciably, and confidence economic expansion. in the banking system has been bolstered. Developments in the money and capital mar­ Our Nation’s business enterprises have like­ kets during the current recovery contrast sharply wise taken advantage of the prevailing financial with those observed in past cyclical upswings. climate to improve their financial condition. Short-term interest rates usually begin to rise Corporations issued a huge volume of long-term at about the time that general business activity bonds during 1975, and they used much of the turns up. Soon thereafter, inflows of savings to proceeds to repay short-term debt and to acquire thrift institutions often begin to dry up, and the liquid assets. This year, they are still finding homebuilding industry is then adversely af­ long-term funds readily available. Public offer­ fected. ings of bonds by domestic corporations totaled In view of the vigorous rebound of economic $3 billion last month—an extraordinary volume activity, the continuing advance of the price by historical standards. For a time, access to level, and the record volume of Treasury bor­ public markets for long-term funds was confined rowing, strong upward pressures on short-term largely to firms with the highest credit ratings. interest rates might well have been expected During the past several months, however, some during the past year. However, after some run­ lower-rated firms have found a more receptive up in the summer months of 1975, short-term public market for their debt issues, as is re­ rates turned down again last fall, and long-term flected in a narrowing of the yield spread be­ rates also moved lower. The main cause of the tween Aaa- and A-rated bond issues from IV2 unusual behavior of interest rates was undoubt­ percentage points last summer to about V2 per­ edly the lessening of inflationary fears over the centage point at present. Many medium-sized past year, and the consequent reduction in the firms, and others with lower credit ratings, have inflation premium that got built into interest met their need for long-term funds through rates—particularly, the long-term rates. private placements with life insurance compa­ The financial climate that has prevailed during nies and other institutional lenders. the economic recovery has permitted lenders Besides this, an improved stock market has and borrowers alike to strengthen their financial made it much easier for corporations to raise condition. The liquidity position of savings equity funds for financing new investment pro­ banks and of savings and loan associations, for grams or for restoring capital cushions. During example, has improved markedly over the past June corporate enterprises sold about 1V2 billion year or so. The flow of savings to these institu­ of new shares to the public. If the pace of new tions has been abundant, and they have sub­ stock offerings during the first half of this year stantially increased their mortgage lending as is maintained over the remainder of the year, well as added to their liquidity. The outstanding 1976 will see the largest dollar volume of cor­ mortgage loan commitments of savings and loan porate stock flotations in our history. associations—the leading suppliers of home These accomplishments in financial markets mortgage credit—are now close to the highest indicate, I believe^ that the course of moderation dollar figure on record. in monetary policy pursued over the past year Commercial banks have also rebuilt their li­ has aided the process of recovery in economic quidity. They have done so by adding large activity. amounts of short-term Treasury securities to We at the Federal Reserve remain deeply their portfolios, besides reducing their reliance concerned about the level of unemployment that on volatile funds. The condition of the banking still exists in our country. We recognize the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 671 pressing need for the Nation to regain more again been increasing, and the annual rate of prosperous economic conditions. We also rec­ increase in consumer prices has stepped up to ognize, as thoughtful Americans generally do, 6V2 per cent. It appears that the underlying rate that lasting prosperity will not be achieved until of inflation has not diminished since mid-1975 our country solves its chronic problem of infla­ and that it may still be about 6 or 7 per cent. tion. Any such rate of inflation constitutes a serious The inflation that is still damaging our econ­ threat to the economy, and elimination of our omy and troubling our people began over a disease of inflation must therefore remain a decade ago—largely as a consequence of loose major objective of public policy. Monetary pol­ fiscal policies. Over the past 10 years, the Fed­ icy—no matter how well designed and imple­ eral budget has been in deficit in every fiscal mented—cannot do the job alone. Adherence year but one. Over that 10-year span, the total to a moderate course of monetary policy can, deficit in the Federal budget—including off- however, make a significant contribution to the budget agencies and Government-sponsored en­ fight against inflation. terprises—has cumulated to almost $300 billion. A year ago, I reported to this committee the These huge and persistent deficits added little Federal Reserve’s projection that Mx—that is, to our capacity to produce, but they added the money stock defined so as to include only enormously to aggregate demand for goods and currency and demand deposits—should grow services. They have thus been directly respon­ between 5 and IV2 per cent during the year sible for a substantial part of the inflation prob­ ending in the second quarter of 1976. For M2— lem. In financing these deficits, and also in which also includes consumer-type time and meeting the large demands for credit by business savings deposits at commercial banks—a range and consumers, tremendous pressures were of SV2 to 10V2 per cent was deemed appropriate. placed on our credit mechanisms, and the supply For M3—a still broader measure of money bal­ of money has tended to grow at a rate inconsis­ ances encompassing, besides the components of tent with price stability. M2, the deposits at nonbank thrift institutions— In the early 1970’s, the underlying inflation­ the range was set at 10 to 12 per cent. As I ary trend caused by lax financial policies was informed the committee at the time, we believed greatly aggravated by a variety of special fac­ that these projected rates of growth of the major tors. In 1972 and 1973 crop harvests were poor monetary aggregates would facilitate substantial both here and abroad, and a boom in economic recovery in economic activity without aggra­ activity developed throughout the industrialized vating the problem of inflation. world. Upward pressures on our prices were Looking back, we find that the pace of mon­ further augmented by devaluation of the dollar etary expansion was generally in line with the in international exchange markets, and by an specified ranges. During the year ended in the enormous run-up in prices of gasoline, fuel oil, second quarter of 1976, Mx grew by 5.2 per and other energy items. By 1974 these special cent, or near the lower end of the projected factors combined with the underlying inflation­ range. M2, on the other hand, rose by 9.8 per ary trend to set off an explosion of the general cent, which was near the midpoint of its range, price level. while M3 grew 12.1 per cent, or close to the Our Nation has made notable progress since top end of its range. then in reducing the rate of inflation. The rise The Federal Reserve was urged repeatedly in consumer prices came down from 12 per cent during the past year to pursue a more expan­ in 1974 to 7 per cent in 1975. Over the first sionist policy in order to speed the return to 4 months of this year, the rise in consumer full employment. Some economists as well as prices moderated further, to a 3% per cent some members of the Congress expressed con­ annual rate, reflecting a temporary decline in cern that the rates of monetary growth we were the prices of food and fuel. In the past 2 months, seeking would prove inadequate to finance a however, retail prices of food and fuel have good economic expansion. We at the Federal Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

672 Federal Reserve Bulletin □ August 1976 Reserve respected but did not share this pessi­ off a threat of excessive growth of the monetary mistic view. We judged from experience, first, aggregates. In April, Mx expanded very that the turnover of existing money balances is sharply—to an annual growth rate of 15 per apt to increase rapidly with the return of confi­ cent. We recognized that technical factors— dence; second, that more rapid expansion of such as the decline in the Treasury’s cash bal­ money and credit is likely to intensify inflation­ ance—were partly responsible, and that the ary expectations and soon sow the seeds of bulge in the monetary growth rate might be another recession. Consequently, we resisted temporary. We could not, however, risk an advice to open the tap and let money flow out explosion of the monetary aggregates during a in greater abundance. period of advancing economic activity. The moderate rate of monetary expansion Over a period of several weeks starting in fostered by the Federal Reserve proved quite late April, the Federal Reserve thus became sufficient to finance a large increase in the phys­ somewhat less accommodative in meeting the ical volume of output and a still larger increase demand for bank reserves. The upward move­ in the dollar volume of output. As expected, ment in market rates of interest that followed the increase of money stocks was accompanied reflected our actions as well as rising demands by a sharp rise in the turnover of money bal­ for credit. Subsequently the pace of monetary ances. Moreover, neither rising interest rates nor expansion moderated, and interest rates have developing shortages of credit were associated declined again. with this rise in velocity. On the contrary, This temporary rise of interest rates was conditions in financial markets, as I noted ear­ largely confined to sensitive market yields. In­ lier, have been relatively easy, and they remain terest rates on loans to small businesses and favorable to economic expansion. farmers, also on instalment loans to consumers, Over the course of the past year, the Federal have continued to move down or remain sub­ Reserve made several modifications in its pro­ stantially unchanged. jected growth ranges. Last October, the lower Most interest rates at the present time are at boundaries of the ranges for both M2 and M3 or below their levels in the spring of 1975, when were reduced by one percentage point. This the economic recovery began. For example, the January, the lower boundary of the range for yield on 3-month Treasury bills reached a low was reduced by a half of a percentage point, of around 5% per cent in May 1975 and is now and in April the upper limit for both M± and at about that same level. The rate on new issues M2 was lowered by a half of a percentage point. of high grade corporate bonds in May 1975 was These were small changes, but they were 9Vi per cent; now that rate is down to around logical steps in light of economic and financial 8V2 per cent. Interest charges on automobile developments. Reductions in our projected instalment loans are at their lowest level since growth ranges were needed because improve­ mid-1974, while those on bank loans to small ments in financial technology made it possible businesses are lower than at any time in 3 years. for a moderate increase in money balances to At its meeting last week, the Federal Open finance a good economic recovery with declin­ Market Committee specified growth ranges of ing interest rates. But in any event, some re­ the monetary aggregates for the year ending in duction in the projected growth ranges would the second quarter of 1977. The ranges differ have been called for as the expansion in eco­ only a little from those announced last May. nomic activity proceeded. The range of AV2 to 7 per cent was retained The downward adjustments of these growth for Mx. For M2 the upper boundary of the range ranges served to reassure the business and fi­ was reduced by a half percentage point; for M3 nancial community that we intend to stick to the upper boundary was brought down by a full a course of moderation in monetary policy. percentage point. Consequently, the new range Another indication of our firm resolve was the is IVi to 9Vi per cent for M2, and 9 to 11 per prompt action taken some weeks ago to ward cent for M3. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 673 The projected range for was left un­ ceeding at too slow a pace. The residential changed because of considerable uncertainty building industry and other branches of con­ about the transactions balances that may be struction are still depressed. And the menace needed over the next year to finance a good rate of inflation is still with us, though in a less of economic expansion. During the first year of virulent form than in many other countries the economic recovery, the income velocity of around the world. Rampant inflation abroad— Ml rose by 8 per cent. Recently, however, the West Germany and Switzerland are outstanding rise of velocity has slowed appreciably, and it exceptions—has been a major factor in the tur­ would be reasonable to expect the financing of bulence of foreign exchange markets this year. economic activity over the next yeaf to depend In conclusion, let me sketch briefly the direc­ less on increasing velocity of money balances tions in which our Nation may need to move than it did during the past year. in order to deal effectively with some of these I have advised the Congress repeatedly that problems. the rate of expansion in Mx will have to be First, the Board believes that the prospects lowered gradually in order to be consistent with for a durable prosperity would be enhanced by restoration of general price stability. However, moderation in the course of fiscal policy. The in view of recent developments with regard to deficit in the Federal budget has diminished very the turnover of M1? a reduction of the previously little over the past year—especially when the projected growth of seems inappropriate at operations of off-budget agencies and Govern­ this time. ment-sponsored enterprises are taken into ac­ Some lowering of the growth ranges for M2 count, as they should be. It is of the utmost and M3 is nevertheless desirable. Depositary importance that the Congress and the adminis­ institutions have experienced very ample in­ tration cooperate to maintain tight control over flows of savings over the past year, and some Federal expenditures. At the present stage of of them—particularly among the thrift institu­ the business cycle, a substantial decline of the tions—have recently reduced somewhat the Federal deficit is desirable in order that savings rates they pay on various classes of deposits or may become sufficiently available for muchhave taken other actions to discourage inflows needed private investment and that renewed of funds in excess of what they can lend or inflationary pressures be avoided. invest profitably. Since market interest rates on Second, we would be well advised to avoid short-term securities have also risen marginally actions that might damage public confidence or since April of this year, savings inflows of late threaten the vitality of particular industries. For appear to have moderated. Consequently, if the example, the recent ruling by the Federal Trade ranges of expansion in M2 and M3 are to be Commission on the “holder-in-due course” consistent with our projected range for M1? they doctrine seems to have come at an unpropitious need to be lowered somewhat. These downward moment. It may well be reducing somewhat the adjustments, I should add, are another small and availability of credit to consumers and some prudent step in moving toward a rate of mone­ retailers at the very time when a continued tary expansion that may in time accommodate strong rise of consumer spending is needed to general price stability. foster further gains in production and employ­ We can all take considerable satisfaction in ment. Also, serious discussion of legislation to the progress that has been made over the past split up the Nation’s large oil companies may year in restoring more prosperous conditions in even now be discouraging the investment re­ our country. Both the Congress and the admin­ quired to relieve our critical energy problem. istration deserve credit for improving the eco­ Third, we ought to move forward with struc­ nomic climate. Much remains to be accom­ tural changes that will enhance the prospects for plished, however. Unemployment remains returning to full employment without releasing much too high. Productivity has been lagging. a new wave of inflation. A part of our recent The expansion of our industrial plant is pro­ problem of continuing inflation amidst wide­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

674 Federal Reserve Bulletin □ August 1976 spread unemployment stems from a failure to gather the courage to reassess the nature and attend sufficiently to modernization and im­ enforcement of our laws directed against re­ provement of our Nation’s industrial plant. straint of trade by business firms; also the There is a clear need in our country for a larger various restrictions on entry into the profes­ volume of business capital investment and for sions, the wage and employment standards in greater reliance by business firms on equity the Davis-Bacon Act, the proper role of trade funds in financing their capital expenditures. unions in the public sector, the monopoly of These objectives could be promoted by an first-class mail by the Postal Service, and the overhaul of the structure of Federal taxation. mass of governmental regulations that impede Governmental practices and programs affect­ the competitive process and run up costs for ing labor markets also have to be reviewed in business enterprises. any serious search for lasting measures to reduce There are numerous structural measures be­ unemployment. For example, the Federal mini­ sides those I have mentioned that might aid in mum wage law is still pricing many teenagers the restoration of general prosperity. Progress out of the job market, and our present programs in this field is, I believe, a matter of urgency. for unemployment compensation may be pro­ Our Nation has tolerated high rates of unem­ viding benefits on such a generous scale as to ployment and of inflation much too long. But blunt incentives to work. We would also benefit our Nation cannot reach the goal of full em­ from more effective job banks, more realistic ployment by pursuing fiscal and monetary poli­ training programs, and other labor market poli­ cies that rekindle inflation. The Board therefore cies. urges the Congress and the Administration to Structural changes in other areas are also move ahead on structural policies that promise needed to enhance the prospects for expanded to strengthen competitive forces in our markets employment, while at the same time reducing and to open new opportunities for expansion of the pressures on costs and prices. We need to production and employment. □ Statement by Philip C. Jackson, Jr., Member, scheme under the Consumer Credit Protection Board of Governors of the Federal Reserve Act. System, before the Committee on Banking, In discharging its responsibilities under the Housing, and Urban Affairs, U.S. Senate, July Consumer Credit Protection Act, the Board of 29, 1976. Governors must fulfill the role of writer and promulgator of regulations under the statute as I appreciate the opportunity to participate on well as that of enforcer of the statute for State behalf of the Board of Governors of the Federal member banks. Thus, the Board’s Office of Reserve System in these hearings. For purposes Saver and Consumer Affairs not only responds of brevity, I will not repeat the answers pre­ to consumer complaints but also drafts regula­ viously furnished to the committee in response tions and interpretations to implement the statute to its questions. These answers outline the na­ and assists our Division of Banking Supervision ture and extent of the Board’s Office of Saver and Regulation in its enforcement respon­ and Consumer Affairs, which acts on consumer sibilities. complaints. They describe the enforcement ac­ Our past enforcement efforts under the Con­ tivities in the consumer credit area of both the sumer Credit Protection Act, primarily concen­ Board of Governors and the Federal Reserve trated in the Truth in Lending Act area, have System as a whole. They also speak to the utilized the standard bank examination tech­ rationale and need for the complex regulatory nique. However, the recent rapid growth of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 675 consumer credit laws in general is leading us cable to closed-end credit. As soon as more toward changes in this approach. These laws practical experience is gained under the Fair encompass such a broad range of highly techni­ Credit Billing Act, similar recommendations for cal subjects that examiners understandably have potential simplification applicable to open-end difficulty keeping up with the many details in­ credit may be in order. One of the recom­ volved. We have also found that the techniques mendations made earlier—the possible limita­ needed for examination of bank practices and tion of creditor liability to acts that significantly policies in the consumer credit area are quite injure or mislead consumers—offers some hope different from the approach that is appropriate of a major change toward simplicity in the for determining banks’ safety and soundness. statute and its implementation. In recent months a committee of the Board In the Board’s view, the principal reason that of Governors has been studying various ap­ these statutes and regulations are complex is that proaches to the enforcement of consumer credit the credit system in America is complex beyond laws. This committee is striving to determine the ability of any one person or organization the best approach toward this type of enforce­ to completely understand. Ours has become ment activity and to provide for uniform tech­ such a credit-oriented society that the purchase niques throughout the System. of practically any kind of good or service may Several Reserve Banks have already estab­ directly or indirectly involve the use of credit. lished special teams and procedures for en­ It is thus axiomatic that any statute or imple­ forcement of consumer credit regulations. The menting regulation that is applicable to credit teams consist of experts and provide helpful in general will tend to be as complex as the information to banks, particularly small banks system it is designed to regulate. We feel the where the burdens of technical compliance are best solution to this problem for the future is disproportionately large. These specialists are to limit legislative corrective action to those also working to develop new techniques for particular fields where significant public abuse examination that will meet the demands for the has developed. more contemporaneous concepts of compliance The Board was pleased that the Congress with the new regulations. Generally, these Re­ recently authorized establishment of a Con­ serve Banks are finding it appropriate to separate sumer Advisory Council, which has advisory enforcement for compliance under consumer responsibility on a broad range of consumer credit legislation from standard examinations on matters. We are also pleased that, following safety and soundness. public notice, a large number of qualified people The Board shares the banking committee’s has indicated a willingness to serve on the concern about the complexity of the regulatory Council. Final selection of Council members is scheme that has arisen as a consequence of the now being made. This Council should prove to Consumer Credit Protection Act. In recent be beneficial in assisting the Board in its com­ weeks, we have made some recommendations mitment toward effective action in the regula­ to this committee for statutory simplification of tory and enforcement aspects of consumer credit those aspects of the Truth in Lending Act appli­ legislation. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

676 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON JUNE 22, 1976 Domestic Policy Directive The information reviewed at this meeting suggested that growth in real output of goods and services had moderated in the second quarter from the rapid pace to which it had accelerated in the first quarter, now estimated by the Commerce Department to have been at an annual rate of 8.7 per cent. Average prices appeared to have risen more in the second quarter than the first, when the rate of advance had been relatively low. Staff projections suggested that during the second half of the year real GNP would expand at a good pace and that prices would continue to rise somewhat faster than they had in the first quarter. The second-quarter moderation in growth of real output was attributable primarily to a considerable slowing in the rates of increase in consumer spending and business inventory investment. Retail sales, which had risen substantially in late 1975 and early 1976, were estimated to have remained about unchanged in April and to have declined somewhat in May—as a result of weakness in nondurable goods sales in both months and a downturn in sales of autos in May. However, weekly data suggested some pick-up in retail sales in late May and early June. Industrial production, employment, and personal income all rose substantially further in May. Production gains were largest in industries that make business equipment, durable consumer goods other than autos, and materials for durable goods industries. Auto production rose only slightly further. Output of nondurable goods also increased, but growth in that area had slowed appreciably from the high rates of the summer and early fall of 1975. As in April, the rise in production was reduced somewhat by a strike in the rubber industry. Conditions in labor markets continued to improve in May. Nonfarm payroll employment reached a level some 250,000 above its pre-recession high, and the unemployment rate declined from Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 677 7.5 to 7.3 per cent. The average length of the factory workweek rebounded to about its March level, following a decline in April that apparently had been related to holidays in the week of the survey. Personal income increased at about the average rate of other recent months. Private housing starts, which had declined in March and April, rose somewhat in May to a little above the first-quarter average rate. The May increase was accounted for by a rise in starts of multifamily units to the highest level in nearly 2 years, although such starts were still quite low by historical standards. Residential building permits increased for both single and multifamily units. Outstanding mortgage loan commitments at savings and loan asso­ ciations had advanced further in April, the latest month for which data were available. Although nonresidential construction activity remained weak in April, new orders for nondefense capital goods increased substan­ tially further in both April and May. A Commerce Department survey of anticipated plant and equipment expenditures, taken in late April and early May, indicated that businesses were planning to step up capital outlays in 1976 relative to 1975 somewhat more than had been suggested by a corresponding survey taken in February. The rise, however, was considerably smaller than had been implied by an intervening private survey. According to the latest Commerce Department survey, the largest increases in capital outlays were planned by electric and gas utilities and manufacturers of nondurable goods. According to available data, capacity utilization rates in indus­ tries producing major materials were still well below earlier peaks but had risen markedly, particularly in nondurable goods industries. Comments of businessmen in the course of conversations with Reserve Bank personnel also suggested that rates of capacity use were generally high in major industries. In almost all such indus­ tries, however, capacity was regarded as adequate for at least the next 6 to 12 months. The wholesale price index for all commodities—which had risen appreciably in April following 5 months of little change—increased moderately in May. The rise was attributable to some further increase in prices of farm and food products, following their sharp advance in April. The May index for industrial commodities was Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

678 Federal Reserve B ulletin □ August 1976 virtually unchanged, but it did not reflect subsequent price increases for steel and gasoline. The rate of increase in consumer prices stepped up somewhat in May, as prices of food and energy items rose; earlier in the year the rise in the consumer price index had been held down by declines in such items. Apart from food and energy, average consumer prices had advanced at a relatively steady annual rate, in the neighborhood of 7 per cent, for the past year. The index of average hourly earnings for private nonfarm pro­ duction workers advanced at a faster pace in May than in previous months of the year, reflecting in part the impact of a major labor settlement in the transportation industry and sizable wage increases in service industries. Over the first 5 months of 1976 the rate of increase in average wage rates was less than in the second half of 1975. A staff analysis of the economic situation indicated that the economic expansion had slowed somewhat more in the second quarter than had been anticipated a month earlier, mainly because of sluggishness in retail sales. In the staff’s judgment, however, the recent weakness in consumer spending was likely to prove to be a temporary pause of the kind that had often occurred during periods of economic expansion—most recently in 1975, following the sharp advance of the spring and early summer. It was noted that the basic determinants of consumer spending—including the rates of growth in employment and in real personal income—were conducive to a resumption relatively soon of stronger gains in outlays. In general, it appeared that there had been little change during the past month in the fundamental factors underlying the outlook for economic activity. Therefore, relatively little change had been made in the staff’s projections for the second half of 1976. Although the latest Commerce Department survey suggested less growth in business capital spending than had an earlier private survey, the outlook in that sector remained relatively favorable—in light of such factors as the recent increases in production of business equipment and in new orders for nondefense capital goods, and rising rates of capacity utilization. Businesses were expected to maintain a high rate of inventory investment, particularly in durable goods. Residential construction outlays were projected to rise in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 679 the second half, although at a somewhat slower pace than antici­ pated a month earlier. U.S. foreign trade was in deficit again during April, but the deficit was less than in March and was about equal to the average rate in the first quarter. Nonfuel imports declined from their high March volume, while nonagricultural exports rose somewhat from the depressed levels early in the year. In the latter part of May the average value of the dollar against leading foreign currencies increased about 1 per cent on a tradeweighted basis, in part because of a rise in U.S. interest rates relative to interest rates abroad, but it changed little thereafter. During the period since the meeting of the Committee in mid-May the dollar had appreciated on balance against all major currencies except the Canadian dollar and the Swiss franc. A steep decline in exchange rates for the British pound was halted and partly reversed in early June after announcement of a $5.3 billion package of standby credits to the Bank of England by the Group of Ten countries, Switzerland, and the Bank for International Settlements. The package included $1 billion under the Federal Reserve swap line with the Bank of England and $1 billion under a U.S. Treasury Exchange Stabilization Fund swap arrangement with that Bank. At U.S. commercial banks total loans and investments expanded further in May, but most of the growth continued to reflect increased bank holdings of Treasury securities. While real estate loans re­ mained strong and business loans rose for the first time since January, total loans outstanding at banks were about unchanged. The volume of commercial paper issued by nonfinancial corpora­ tions increased somewhat further during the month. Growth in the narrowly defined money stock—Mx—slowed to a 6 per cent annual rate in May from the exceptionally rapid 15 per cent rate recorded in April and appeared to be moderating further in early June. Much of the slowing might have been attributable to adjustments in cash balances following the bulge that had developed in April. Growth in the broader measures of the money stock—M2 and M3—also slowed in May, due in most part to the slower expansion in demand deposits. Inflows of time and savings deposits (other than negotiable CD’s) at banks and nonbank thrift institutions were relatively well maintained during May and early June—despite a marked diminution of inflows to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

680 Federal Reserve Bulletin □ August 1976 passbook savings accounts at banks as short-term market interest rates moved above the ceiling rate on such accounts. System open market operations since the May meeting had been guided by the Committee’s decision to seek bank reserve and money market conditions consistent with moderate growth in the monetary aggregates over the period ahead, while taking account of develop­ ments in domestic and international financial markets. Immediately following the May meeting, the System had become a little less accommodative in the provision of reserves, as it aimed at reserve conditions consistent with a Federal funds rate averaging around 53/s per cent. This was slightly above the 5XA per cent rate prevailing at the time of the meeting and equal to the midpoint of the 5 to 5% per cent operating range that the Committee had specified for the inter-meeting period. Data becoming available in the latter part of May suggested that the May-June rates of growth in both M1 and M2 would be near the upper ends of the Committee’s ranges of tolerance. Accord­ ingly, the System sought reserve conditions consistent with a Federal funds rate of about 5xh per cent. While subsequent data tended to confirm the late-May projection of growth in M2, they also suggested that growth in Mx might be weaker than had been indicated earlier. Under the circumstances the System continued to aim at reserve conditions consistent with a Federal funds rate averaging around 5Vi per cent. Short-term interest rates in general rose somewhat further in the latter part of May, reflecting market responses to the firming in money market conditions and some increase in business credit demands. During this period most banks raised the prime rate applicable to large business borrowers in two steps from 63A to 1XA per cent. Subsequently, short-term rates fluctuated in a narrow range, as market attitudes appeared to be influenced by indications that the rate of monetary growth had slowed, by the leveling off of the Federal funds rate, and by evidence of some moderation in the pace of economic expansion. Over the inter-meeting period as a whole, most private short-term interest rates increased mod­ estly, on balance, while rates on Treasury securities changed little. On the day before this meeting the market rate on 3-month Treasury bills was 5.36 per cent, compared with 5.22 per cent on the day before the May meeting. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 681 Interest rates on intermediate- and long-term securities declined a little on balance over the inter-meeting period, in part reflecting the stabilization of conditions in short-term markets. In May public offerings of new corporate bonds and stocks remained substantial, and the volume of new State and local government bond offerings rose to the highest level on record. Interest rates on home mortgages in the primary market, which typically lag bond yields, had edged up in recent weeks. However, yields in the secondary market for mortgages tended to move with other long-term rates—rising in May and declining in the first half of June. In mid-May the Treasury announced plans to sell $2.25 billion of 2-year notes and $2.0 billion of 4-year 1-month notes, in order to refund $1.5 billion of publicly held notes maturing on May 31 and to raise $2.75 billion of new cash. In auctions on May 19 and June 3 the notes were sold at average prices to yield 7.16 and 7.71 per cent, respectively. Because its cash balance exceeded its earlier anticipations, the Treasury was able to meet its seasonal financing need prior to the June 15 tax date through the issuance of $2 billion of 9-day cash-management bills—roughly half the amount previously projected. In the week before this meeting the Treasury announced that in the coming weeks it would sell $2.5 billion of 2-year notes and $2.5 billion of 5-year 1-month notes. In April, when the Committee had last reviewed its longer-run ranges for the monetary aggregates, it had agreed that on the average over the period from the first quarter of 1976 to the first quarter of 1977 growth at rates within the following ranges appeared to be consistent with its broad economic aims: Mx, AVi to 7 per cent; M2, IV2 to 10 per cent; and M3, 9 to 12 per cent. The associated range for growth in the bank credit proxy was 6 to 9 per cent. It was agreed that the longer-term ranges, as well as the particular list of aggregates for which such ranges were speci­ fied, would be subject to review and modification at subsequent meetings. It was also understood that, as a result of short-run factors, growth rates from month to month might well fall outside the ranges contemplated for annual periods. In the discussion of current policy at this meeting, the Committee took note of a staff analysis suggesting that, if prevailing money market conditions were maintained over the coming 4-week inter­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

682 Federal Reserve Bulletin □ August 1976 val, rates of growth in and M2 for June and July combined were likely to average close to the moderate pace that had developed in May. These rates were substantially below the very rapid growth rates experienced in April and near the midpoints of the longer-run ranges agreed upon by the Committee at its April meeting. The staff analysis suggested that growth in would be in­ fluenced by increasing demands for money associated with expan­ sion in nominal GNP, but that the rise in June was likely to be somewhat smaller than in July because of continuing adjustments of cash balances built up during the April bulge in money growth. Growth in the time deposit component of M2 was expected to moderate slightly further, reflecting some continued shifts of inter­ est-sensitive funds from passbook savings accounts to alternative forms of liquid assets. The analysis also suggested that financial markets were not likely to come under pressure in the near term. Following the large volume of new corporate and municipal issues being offered in June, the supply of new bonds was expected to slacken seasonally. Moreover, while the Treasury faced a large budget deficit in the third quarter, it appeared that part of its cash needs in that quarter could be accommodated through reductions in what seemed likely to be a relatively large mid-year cash balance. It appeared, however, that over the somewhat longer run, strengthening could be expected in private short-term credit demands, particularly from businesses. In discussion of the longer-term outlook for credit demands, it was noted by a staff member that business inventory accumulation and capital spending were projected to be larger in the second half of 1976 than in the first half. Because these expanded outlays seemed likely to exceed internal accumulations of funds, over-all business needs for external financing were projected to rise. In view of the large volume of financing already accommodated in capital markets during the first half of the year, the bulk of this additional second-half need was expected to be met at banks. During the Committee’s policy discussion, it was observed that the apparent moderation in the rate of growth in real GNP in the second quarter was, by and large, a healthy development, in the sense that continuation of the rapid first-quarter rate of expansion would soon have generated undesirable boom conditions. On the whole, the members were of the view that the economic expansion Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 683 was proceeding satisfactorily and that the outlook was favorable. At the same time, some concern was expressed about the possibility that inflationary pressures would strengthen as the expansion pro­ ceeded. Some differences emerged during the discussion in the degree of confidence with which members viewed the outlook in particular economic sectors. Thus, while the members were generally inclined to agree that the second-quarter slowing in consumer spending— which had been a major contributing factor to the moderation in GNP growth—was likely to prove temporary, several noted that that outcome was not wholly certain. Some members were more confident than others about the likely strength in capital spending. One member, who was personally optimistic on that score, never­ theless observed that the investment plans of many of the business­ men with whom he had talked were being affected by their concerns regarding the implications of current and possible governmental regulatory actions. Another indicated that he would interpret recent businessmen’s comments to Reserve Banks as suggesting that there was less excess capacity in the economy than one might have thought. With respect to the outlook for residential construction, some members indicated that they had been rather disappointed by developments in recent months—including the relatively low average rate of multifamily starts and the failure of new home sales to rise above the levels of last autumn. In support of a contrary view, reference was made to the May increase in starts and permits, and to what appeared to be a generally optimistic attitude within the homebuilding industry. In general, Committee members favored directing open market operations in the period immediately ahead toward achieving bank reserve and money market conditions consistent with moderate growth in the monetary aggregates. Some suggested specifying operating ranges for Mx and M2 in the June-July period with upper limits no higher than 7 and 10 per cent, respectively—the upper limits of the longer-run ranges agreed upon at the April meeting— on the ground that more rapid growth in the short run would make realization of the longer-run goals more difficult. Others indicated that they were prepared to accept somewhat more rapid growth over the June-July period. The Committee agreed that it would be desirable to maintain Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

684 Federal Reserve Bulletin □ August 1976 relative stability in money market conditions at this juncture, in light of the current slowing of the economic expansion and the moderation of growth in the monetary aggregates since April. It was noted by some members that, if the economy expanded about as projected during the second half of the year, some firming of money market conditions might well be required to hold growth of the monetary aggregates within the Committee’s longer-run ranges, and it was suggested that a small rise in the Federal funds rate now might serve to moderate the extent of the increase that might otherwise be indicated later. It was also noted, however, that there was little risk in awaiting stronger confirmation that the recent slowing of growth in consumer spending was only tempo­ rary. In addition, it was observed that short-term interest rates were already somewhat higher than they had been in April. With respect to the interest rate outlook, one Committee member questioned the staff’s projection of enlarged business credit demands at banks in the second half of 1976. There were some differences in members’ views regarding the desired inter-meeting range of tolerance for the weekly-average Federal funds rate. A substantial majority favored a relatively narrow range of 5Va to 5% per cent, on the grounds that a significant easing of money market conditions would be undesirable at this time in view of the likelihood that it might have to be reversed shortly, and that a significant firming would be inappropriate in view of the element of uncertainty in the economic outlook. Some, however, preferred a wider range of 5 to 6 per cent in order to allow more scope for responses to possible deviations from expec­ tations in growth rates of the monetary aggregates. At the conclusion of the discussion the Committee members agreed that growth in and M2 over the June-July period at annual rates of 3Vz to IVi per cent and 6 to 10 per cent, respectively, would be acceptable. As at other recent meetings, they decided that approximately equal weight should be given to Mt and M2 in assessing the behavior of the aggregates. Finally, they agreed that until the next meeting the weekly-average Federal funds rate might be expected to vary in a gradual and orderly way within a 5Va to 5% per cent range. As customary, it was understood that the Chairman might call upon the Committee to consider the need for supplementary instructions before the next scheduled meeting Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 685 if significant inconsistencies appeared to be developing among the Committee’s various objectives. The following domestic policy directive was issued to the Federal Reserve Bank of New York: The information reviewed at this meeting suggests that growth in real output of goods and services, which had been vigorous in the first quarter, has moderated in the current quarter. In May retail sales declined from the March-April level and were near the monthly average of the first quarter. However, recovery in industrial produc­ tion continued at about the average pace of the first 4 months of the year, and the gain in employment again was substantial. The unemployment rate declined from 7.5 to 7.3 per cent. The rise in the wholesale price index for all commodities, which had been large in April, was moderate in May; average prices of farm products and foods rose much less than in April. Average prices of industrial commodities changed little in May, but in recent weeks price increases have been announced for some major industrial materials. The rise in consumer prices in May was somewhat faster than the average increase in earlier months of the year, owing to increases in prices of food and energy items. The advance in the index of average wage rates was larger in May than the gains in other recent months, owing in part to implementation of a new labor contract in a major industry. The average value of the dollar against leading foreign currencies has been relatively steady in recent weeks. On June 7 a total of $5.3 billion of 6-month stand-by credits to the United Kingdom was announced, including $1 billion under the Federal Reserve System’s swap line and $1 billion from the Exchange Stabilization Fund. Subsequently, the decline in the pound sterling was halted and partly reversed. In April the U.S. foreign trade deficit was at the same rate as in the first quarter. Growth in monetary aggregates slowed substantially in May and early June from the exceptionally rapid rates recorded in April, mainly because of a sharp slackening in expansion of demand deposits at commercial banks; inflows of those time and savings deposits included in the broader aggregates were relatively well maintained. Market interest rates in general rose somewhat further in the latter part of May, but since then, short-term rates have fluctuated in a narrow range and long-term rates have edged down. In light of the foregoing developments, it is the policy of the Federal Open Market Committee to foster financial conditions that Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

686 Federal Reserve Bulletin □ August 1976 will encourage continued economic expansion, while resisting in­ flationary 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 period ahead. Votes for this action: Messrs. Burns, Volcker, Balles, Black, Coldwell, Gardner, Jackson, Lilly, Partee, Wallich, Winn, and Baughman. Votes against this action: None. Absent and not voting: Mr. Kimbrel. (Mr. Baughman voted as alternate for Mr. Kimbrel.) 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 a month after the meeting and are subsequently published in the Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

687 Law Department Statutes, regulations, interpretations, and decisions Securities Credit by Persons margin securities, may apply for termination of Other Than Banks, Brokers, or Dealers such registration by filing Federal Reserve Form G-2 with the Federal Reserve Bank of the district The Board of Governors has adopted several in which the principal office of such person is amendments to its Regulation G relating to regis­ located. A registration shall be deemed terminated tration, termination of registration, and reporting when such application is approved by the Board requirements. of Governors of the Federal Reserve System. Effective August 20, 1976, Part 207 is amended as follows: 1. Paragraphs (a) and (b) of section 207.1 are 2. Section 207.3 (a) is amended as set forth amended as set forth below: below: Section 207.1—General Rule Section 207.3—Reports and Records (a) Registration. Every person who, in the (a) Every person who is registered pursuant to ordinary course of his business,1 during any cal­ § 207.1(a) of this part shall, within 30 days fol­ endar quarter ended after June 30, 1976, extends lowing June 30, 1977 and within 30 days follow­ or arranges for the extension of a total of $100,000 ing each succeeding June 30 thereafter, file a report or more, or has outstanding at any time during on Federal Reserve Form G-4 with the Federal the calendar quarter, a total of $500,000 or more, Reserve Bank of the district in which the principal in credit, secured directly or indirectly,2 in whole office of the lender is located. or in part, by collateral that includes any margin securities,3 unless such person is subject to Part 220 (Regulation T) or Part 221 (Regulation U) of 3. As an incident of the foregoing amendments this Chapter, is subject to the registration acquire­ to Regulation G, footnotes therein numbered 5, ments of this paragraph and shall, within 30 days 6, 7, 8, and 9 are renumbered 4, 5, 6, 7, and following the end of the calendar quarter during 8, respectively. which the person becomes subject to such regis­ tration requirements, register with the Board of Truth in Lending Governors of the Federal Reserve System by filing a statement in conformity with the requirements The Board of Governors has amended its Regu­ of Federal Reserve Form G-l with the Federal lation Z to require itemization of a finance charge Reserve Bank of the district in which the principal where the finance charge consists of more than office of such person is located. one type of charge. (b) Termination of registration. Any person Effective August 6, 1976, section 226.8 is so registered who has not, during the preceding amended as follows: 6 calendar months, extended or arranged for the extension or maintenance of and has not had more Section 226.8—Credit than $200,000 of credit outstanding at any time other than open end—specific disclosures during such period, secured directly or indirectly, in whole or in part, by collateral that includes any (c) * * * (g) * * * 1 See § 207.2(b) 2See § 207.2(i) (i) The total amount of the finance charge, using 3See § 207.2(d) the term “finance charge,” and where the total Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

688 Federal Reserve Bulletin □ August 1976 charge consists of two or more types of charges, which provides, in part, for the establishment of a description of the amount of each type, and IRA’s by individuals not covered by employer (ii) * * * pension plans. (d) * * * Among the issues presented for comment at that (3^ * * * the total amount of the finance time was the question of whether existing restric­ charge,11 using the term “finance charge,” and tions of Regulation Q relating to withdrawal of where the total charge consists of two or more time deposits prior to maturity unnecessarily in­ types of charges, a description of the amount of terfere with the administration of IRA’s main­ each type. tained at banks in time deposit form. Comment was also requested on whether these restrictions Rules Regarding interfere with the orderly distribution of IRA funds Delegation of Authority to an individual who has reached age 59V2 or has become disabled. In addition, comment was re­ The Board of Governors has amended its Rules quested on whether the existing schedule of ceiling Regarding Delegation of Authority to delegate to interest rates that member banks are permitted to the Secretary of the Board the authority to approve pay on IRA deposits should be increased and future Annual Reports to the Office of Manage­ whether member banks should be permitted to pay ment and Budget on implementation of the Privacy interest on IRA deposits at rates that are equal Act. to those that may be paid by savings and loan Effective July 1, 1976, section 265.2(a) is associations and mutual savings banks. amended by adding a new paragraph (17) to read Numerous comments were received by the as follows: Board and the FDIC on the issues presented. Section 265.2—Specific Ninety financial institutions and organizations Functions Delegated to Board commented on the question of raising interest rate Employees and to Federal Reserve Banks ceilings. Forty-eight commercial banks favored action to increase the interest rate ceiling on funds deposited in IRA’s. Twenty-eight banks, ten thrift institutions, and four organizations representing (a) The Secretary of the Board (or, in his thrift institutions opposed such action. Three hun­ absence, the Acting Secretary) is authorized: dred-nine comments were received on the question of elimination of the existing differential in interest rate ceilings between commercial banks and thrift (17) Pursuant to the requirement of the Pri­ institutions for IRA deposits. Two hundred fortyvacy Act (5 U.S.C. § 552a(p)), to approve future three commercial banks and banking organizations Annual Reports on the Privacy Act from the Board favored the elimination of the differential. Sixty of Governors to the Office of Management and thrift institutions and thrift organizations and six Budget for inclusion in the President’s annual banks opposed elimination of the differential. consolidated report to the Congress. Those institutions and organizations comment­ ing in favor of elimination of the interest rate differential stated that the existing differential in Interest on Deposits rate ceilings places commercial banks at a serious competitive disadvantage with thrift institutions in Individual Retirement Accounts— attracting and retaining IRA deposits. Additional Notice Concerning arguments presented were that the effect of the Rulemaking Proceeding lA per cent differential over time and the effect On June 26, 1975, the Board and the Federal of compounding result in a significant difference Deposit Insurance Corporation (“FDIC”) invited in earnings over the life of an IRA. These com­ public comment on several issues relating to Indi­ ments assert that, since IRA’s constitute an en­ vidual Retirement Accounts (“IRA’s”) and possi­ tirely new type of service available at financial ble amendments to Regulation Q (Interest on De­ institutions, it is inequitable for Federal regulations posits) (40 FR 28644). This action was taken in to permit a rate advantage to exist based solely view of the enactment of the Employee Retirement upon the nature of the regulated institution in Income Security Act of 1974 (Pub.L. 93-406), which the IRA is established. It is argued that in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 689 enacting the IRA provisions, Congress intended intent to encourage individuals not participating to provide an incentive for individuals to save for in other pension plans to save for their retirement their retirement and did not indicate an intent to and to provide a convenient means for payout of favor any one category of financial institution. IRA funds in the future. At the time these actions Consistent with this Congressional intent, an indi­ were taken, the Board indicated that, in view of vidual should be permitted to obtain the highest Congress’s intent to encourage individuals to save rate of return possible on his or her retirement for their retirement, the Board would continue to savings. It is further argued that to restrict indi­ examine the question of whether a differential in viduals from obtaining the highest earnings possi­ interest rate ceilings is appropriate for IRA depos­ ble on these retirement funds by limiting the ceil­ its. ing rate for commercial banks to a rate below that Subsequently, a survey was conducted by the permitted to be paid by thrift institutions would Board in conjunction with the FDIC and Federal be contrary to Congress’s intent that IRA’s are Home Loan Bank Board of IRA accounts of all to be encouraged as a vehicle for accumulating Federally-insured commercial banks, savings and retirement savings. loans, and mutual savings banks. Among the data Those opposed to elimination of the differential obtained were statistics on the amount and distri­ stated that thrift institutions need the lA per cent bution of IRA funds among various types of fi­ differential in order to compete successfully with nancial institutions, distribution of IRA deposits commercial banks for IRA deposits. These com­ according to size of institution, and maturity clas­ ments stated that Congress was aware of the exist­ sifications of IRA deposits at commercial banks ence of the differential when it enacted the IRA and mutual savings banks. The results of this provisions. It was argued that if Congress intended survey indicate that as of March 31, 1976, thrift that IRA participants should be permitted to obtain institutions generally possess relatively more IRA the same rate of interest on IRA deposits regardless deposits than do commercial banks. of where the accounts are established, it would The Board has carefully considered the question have reflected such an intent explicitly in the of an interest rate differential as it applies to IRA legislative history of the provision. Since nothing deposits at commercial banks and thrift institu­ in the legislative history indicates any such explicit tions. During the course of this consideration, the Congressional intent to eliminate the favored po­ Board has given weight to the various arguments sition of thrift institutions, it was argued, Congress presented by those who have commented on the did not intend to affect the existing differential issues raised by the Board’s June 1975 an­ structure when it enacted the IRA provision. nouncement as well as comments received subse­ Many of those opposed to elimination of the dif­ quently. Weight has also been given to the results ferential also stated that any change in the rate of the Board’s survey concerning IRA deposits. structure should await the outcome of Congress’s Consideration has been given to the intent of current review of the powers of financial institu­ Congress in enacting the IRA provisions to en­ tions. courage individuals to save for retirement and the In December 1975, following consideration of effect that a differential may have upon the amount the comments submitted, the Board amended of earnings an individual may obtain on his or Regulation Q to permit member banks to pay all her retirement savings over the life of the IRA. or a portion of an IRA time deposit prior to The Board believes that in enacting the IRA maturity without imposing the Regulation Q inter­ provisions it was the intent of Congress that indi­ est penalty when the depositor attains age 59V2 viduals whose employers do not have private re­ or becomes disabled (40 FR 57663). The Board tirement plans should be encouraged to provide also permitted member banks to waive the $ 1,000 for their retirement needs through the establish­ minimum denomination requirement for IRA time ment of IRA’s. In order to accomplish Congress’s deposits with 4- and 6-year maturities at ceiling intent, as a matter of public policy the Board rates of l lA per cent and IV2 per cent. Similar believes that IRA participants should be permitted actions were taken by the FDIC and by the Federal to obtain the highest rates of interest permissible Home Loan Bank Board for insured nonmember on their retirement savings regardless of where the banks and insured savings and loan associations. deposits are maintained. In the Board’s estimation, These actions were taken to facilitate the estab­ a differential in IRA deposits may be viewed as lishment of IRA’s in accordance with Congress’s inconsistent with the objective of providing IRA Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

690 Federal Reserve Bulletin □ August 1976 depositors with a means of obtaining the highest It is anticipated that further consideration of earnings possible on funds saved for retirement action by the Board to permit member banks to purposes. offer IRA’s on a fully competitive basis will be In addition, the Board believes that there is appropriate in early 1977 concurrent with Con­ some evidence, as yet inconclusive, which indi­ gressional consideration of the extension of the cates that member banks may be at a disadvantage Board’s authority to establish interest rate ceilings vis-a-vis thrift institutions in competing for IRA for member banks and the Board’s recom­ deposits because of the existence of the differential mendations to Congress in connection with that in present interest rate ceilings. review. In this regard, the Board recognizes that The Board has determined that further monitor­ under the provisions of Public Law 94-200 (89 ing for several months will be proper before a final Stat. 1124), any action by the Board to eliminate conclusion is reached. If the present trend in the or reduce an interest rate differential for any cate­ competitive structure for IRA deposits continues, gory of deposits or accounts that was in effect on the Board will then consider taking appropriate December 10, 1975 could not become effective steps to restore competitive balance between com­ until such action was approved by concurrent mercial banks and thrift institutions in the offering resolution of the House of Representatives and the of IRA’s. Senate. Bank H olding Company and Bank M erger Orders Issued by the Board of Governors Orders Under Section 3 Bank (deposits of approximately $29.3 million)1 of Bank Holding Company Act is the only national bank headquartered in Puerto Rico and is the tenth largest of eleven nongovern­ Banco de Santander, S.A., ment-owned commercial banks operating in Puerto Santander, Spain Rico. Because of the nature of the business con­ ducted by Applicant’s representative offices in Order Approving Puerto Rico, it does not appear that any meaning­ Formation of Bank Holding Company ful competition would be eliminated as a result Banco de Santander, S.A., Santander, Spain, of the proposal. In view of Bank’s size and rank has applied for the Board’s approval under § in the market, the Board views the proposed ac­ 3(a)(1) of the Bank Holding Company Act (12 quisition as a foothold entry by Applicant into the U.S.C. 1842(a)(1)) of formation of a bank holding market.2 Such a foothold entry by Applicant company through acquisition of 67 per cent or should have a salutary effect on competition by more of the voting shares of First National Bank enhancing Bank’s competitive capabilities relative of Puerto Rico, Hato Rey, Puerto Rico (“Bank”). to the other banks in the market. Therefore, on Notice of the application, affording opportunity the basis of the record, the Board concludes that for interested persons to submit comments and consummation of the proposal would not have a views, has been given in accordance with § 3(b) significant adverse effect on existing or potential of the Act. The time for filing comments and views competition in any relevant area and that competi­ has expired, and the Board has considered the tive considerations are consistent with approval of application and all comments received in light of the application. the factors set forth in § 3(c) of the Act (12 U.S.C. The financial condition and managerial re­ 1842(c)). sources of Applicant are considered satisfactory Applicant (deposits of approximately $3.2 bil­ and its future prospects appear favorable. Absent lion), a Spanish commercial bank, has 484 consummation of this proposal, the financial con­ branches including branches in Paris, Frankfurt, dition, managerial resources and future prospects and London. Applicant also owns indirectly banks in Argentina and Panama and operates repre­ 1A11 banking data are as of June 30, 1975. sentative offices in Europe, Latin America, New 2The San Juan banking market consists of the San Juan York, New York, and San Juan, Puerto Rico. SMSA. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 691 of Bank would be less than satisfactory. However, for interested persons to submit comments and in view of Applicant’s agreement to inject needed views, has been given in accordance with § 3(b) capital of approximately $3.2 million and its in­ of the Act. The time for filing comments and views tention to strengthen the management of Bank, the has expired, and the Board has considered the same conclusions which apply to Applicant with application and all comments received in light of respect to its financial condition, managerial re­ the factors set forth in § 3(c) of the Act (12 U.S.C. sources and future prospects also apply to Bank. § 1842(c)). Affiliation with Applicant should enable Bank to Applicant is a nonoperating company with no more effectively provide services it has been subsidiaries, organized for the express purpose of forced to reduce as a result of its weakened finan­ becoming a bank holding company through the cial condition. In addition, affiliation with an in­ acquisition of Bank. The purpose of the proposed ternational banking organization such as Applicant transaction is to effect a transfer of the controlling should enable Bank to offer international banking ownership of Bank from an individual to a cor­ services not currently available at Bank. Thus, poration owned by the same individual with no considerations relating to the convenience and change in Bank’s management or operations. needs of the community to be served are also Upon acquisition of Bank, Applicant would con­ consistent with approval of the application. It is trol 0.3 per cent of the total deposits in commercial the Board’s judgment that the proposed acquisition banks in Missouri. would be in the public interest and that the appli­ Bank holds deposits of approximately $44.8 cation should be approved. million,1 representing 0.6 per cent of the total On the basis of the record, the application is deposits in commercial banks in the St. Louis approved for the reasons summarized above. The banking market,2 and ranks as the 46th largest of transaction shall not be made (a) before the thir­ 128 commercial banks operating in the market. tieth calendar day following the effective date of In view of the facts that the proposed transaction this Order of (b) later than three months after the represents a restructuring of Bank’s present own­ effective date of this Order, unless such period ership, and Applicant has no subsidiaries, it does is extended for good cause by the Board, or by not appear that consummation of the proposal the Federal Reserve Bank of New York, pursuant would eliminate any significant existing or poten­ to delegated authority. tial competition, increase the concentration of re­ By order of the Board of Governors, effective sources, or have any adverse effects on any other July 30, 1976. banks in any relevant area. Therefore, the com­ petitive considerations are consistent with approval Voting for this action: Chairman Burns and Gover­ of the application. nors Wallich, Partee, and Lilly. Absent and not voting: Under the Bank Holding Company Act, the Governors Gardner, Coldwell, and Jackson. Board is required to take into consideration the (Signed) G riffith L. Garwood, financial condition, managerial resources, and fu­ [seal] Assistant Secretary of the Board. ture prospects of the proposed holding company and the bank to be acquired. With respect to the subject proposal, it appears that the future pros­ C N Banc Holding Corporation, pects of Applicant are entirely dependent upon the Maplewood, Missouri financial resources of Bank. In this regard, Appli­ cant proposes to service the $2.3 million debt3 it Order Denying will incur as part of this transaction over a twelve- Formation of Bank Holding Company year period primarily through dividends from C N Banc Holding Corporation, Maplewood, Bank, representing 51.2 per cent of Bank’s pro- Missouri (“Applicant”), has applied for the Board’s approval under § 3(a)(1) of the Bank 1A11 banking data are as of December 31, 1975. Holding Company Act (12 U.S.C. 1842(a)(1)) of 2The St. Louis banking market, the relevant geographic market for purposes of analyzing the competitive effects of formation of a bank holding company through the proposed transaction, is approximated by the city of St. acquisition of 80 per cent or more of the voting Louis, St. Louis County, and portions of St. Charles and shares of Citizens National Bank of Greater St. Jefferson Counties, all in Missouri and portions of Madison and St. Clair Counties in Illinois. Louis, Maplewood, Missouri (“Bank”). 3 Four hundred thousand dollars of this total indebtedness Notice of the application, affording opportunity is to be injected into Bank to strengthen its capital. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

692 Federal Reserve Bulletin □ August 1976 jected income for the first year and declining each Columbia Holding Corp., year thereafter to 40.4 per cent in the twelfth year. Chicago, Illinois In view of Bank’s operating history and present Order Denying financial condition, the Board is unable to con­ Formation of Bank Holding Company clude that Applicant’s projected earnings are rea­ sonable or attainable. The Board is of the view Columbia Holding Corp., Chicago, Illinois has that the future earnings of Bank would not provide applied for the Board’s approval under § 3(a)(1) Applicant with the necessary financial flexibility of the Bank Holding Company Act (12 U.S.C. to meet its debt servicing requirements as well as § 1842(a)(1)) of formation of a bank holding any unexpected problems that might arise at Bank. company through the acquisition of 80 per cent In addition, the high level of dividend payout may or more of the voting shares of Columbia National not provide Applicant with the necessary financial Bank of Chicago, Chicago, Illinois (“Bank”). flexibility to service the acquisition debt while Notice of the application, affording opportunity maintaining Bank’s capital position. On the basis for interested persons to submit comments and of the foregoing and other facts of record, the views, has been given in accordance with § 3(b) Board concludes that the considerations relating of the Act. The time for filing comments and views to the banking factors weigh against approval of has expired, and the Board has considered the the application. application and all comments received in light of As stated previously, the proposed formation of the factors set forth in § 3(c) of the Act (12 U.S.C. Applicant merely represents a restructuring of § 1842(c)). Bank’s ownership with no changes in Bank’s Applicant is a nonoperating corporation recently operations or services. Consequently, consid­ organized for the purpose of becoming a bank erations relating to the convenience and needs of holding company through the acquisition of Bank the community to be served lend no weight toward ($55.2 million in deposits).1 Bank ranks 154th approval of the application. Moreover, in view of among the banking organizations in Illinois and Applicant’s debt servicing requirements, consum­ holds approximately .1 per cent of the total de­ mation of the subject transaction could diminish posits held by commercial banks in the State. Bank’s ability to continue to serve the area as a Bank, located approximately 10 miles northwest viable banking alternative. of downtown Chicago, is the 101st largest of the On the basis of all of the facts of record, it 292 commmercial banks operating in the Chicago is the Board’s judgment that the subject proposal banking market2 (the relevant banking market) would result in a bank holding company with with approximately .13 per cent of market depos­ financial and managerial resources that are inade­ its. Inasmuch as the subject proposal represents quate to service its debt while maintaining Bank’s a restructuring of existing ownership interests in capital account. While the Board recognizes that Bank and since Applicant has no present subsidi­ denial of this application would not necessarily aries, consummation of the proposal herein would affect the control of Bank, the Board cannot sanc­ have no adverse effects on existing or potential tion the use of a holding company structure that, competition. because of its debt servicing requirements, could Principals of Applicant are also principals in impair the financial condition of the bank to be Mid-Town Bank of Chicago, Chicago, Illinois acquired; nor would the public interest be served (“Mid-Town Bank”). Mid-Town Bank (deposits by such Board action. Accordingly, the Board of $6.4 million) ranks as the 273rd largest bank concludes that consummation of the proposed in the relevant banking market with .02 per cent transaction would not be in the public interest and of total market deposits. In view of the relatively that the application should be denied. small size of the two banks, the fact that their By order of the Board of Governors, effective offices are six miles apart, and the large number July 19, 1976. of competitors in the market, it appears that there is no significant competition between Mid-Town Voting for this action: Chairman Burns and Gover­ Bank and Bank. Accordingly, based on the forenors Gardner, Wallich, Cold well, Jackson, Partee, and Lilly. (Signed) J. P. Garbarini, *A11 banking data are as of June 30, 1975. 2 The Chicago banking market is approximated by Cook [seal] Assistant Secretary of the Board. County, DuPage County and portions of Lake County. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 693 going and other facts of record, the Board con­ cent on its assets. Thus, Bank does not have a cludes that competitive considerations are consist­ proven record of earnings to support Applicant’s ent with approval of the application. somewhat optimistic projections. Similarly, Ap­ The Board has indicated on a number of occa­ plicant’s projections in regard to Bank’s asset sions that it believes that a holding company growth are not supported by Bank’s actual growth should serve as a source of financial and manage­ experience. rial strength to its subsidiary bank(s) and that the Furthermore, as indicated in footnote 3 supra, Board will closely examine the condition of an the instant proposal contemplates a transaction applicant in each case with this consideration in whereby the debenture holders of Bank will be mind. While the Board considers the managerial exchanging debentures aggregating $600,000, resources of Applicant and Bank as satisfactory, bearing interest at 5.5 and 7.0 per cent, respec­ the Board is concerned with the high level of debt tively, for approximately $1.1 million in Appli­ that will result in connection with the consumma­ cant’s debentures, bearing interest at 10 per cent. tion of this proposal. Applicant proposes to incur As a consequence of this proposal, Bank’s deben­ a debt of $3.0 million3 that Applicant intends to ture holders will receive approximately $110,000 service over a twelve-year period primarily in interest annually on Applicant’s debentures through dividends from Bank and through tax whereas they presently receive $37,500 in interest savings resulting from filing consolidated tax re­ on Bank’s debentures. The Board considers this turns. Based on the facts of record, the Board is additional financial burden on Applicant to be unable to conclude that the proposal would provide further evidence that Applicant’s proposal does not Applicant with the necessary financial flexibility permit Applicant to be a source of financial to service its debt while maintaining adequate strength to Bank. Accordingly, the Board is of capital levels at Bank. In this connection, it is the view that Applicant’s proposal, as presently noted that Bank’s capital is marginally acceptable structured, does not provide Applicant with the at the present time, and this position has been financial flexibility necessary to service its debt, attained through the retention of 100 per cent of maintain Bank’s capital at acceptable levels, and Bank’s earnings since it opened for business in to provide for any unforeseen problems that might 1964. Even though Applicant contemplates pro­ arise at Bank. Therefore, the Board views the debt viding Bank with $300,000 in equity capital upon to be incurred by Applicant as a significantly consummation of the proposal, Bank’s capital adverse factor in the consideration of this proposal would remain only marginally acceptable and finds that the considerations relating to finan­ throughout the debt retirement period, assuming cial resources and future prospects weigh against Applicant’s projections are accurate, as a result approval of the application. of the sizable dividends that will be taken from The proposed formation represents merely a Bank in order to service Applicant’s debt. restructuring of the ownership of Bank with no The Board is also concerned about the narrow changes in Bank’s operations or the services of­ margin for error in Applicant’s projections, since fered to customers. Thus, considerations relating a deviation from those estimates in the future to the convenience and needs of the community would further weaken Bank’s capital and lessen to be served lend no weight toward approval of Applicant’s ability to serve as a source of financial the application. strength. Applicant has projected that Bank’s On the basis of all the circumstances concerning earnings, as a percentage of assets, would equal this application, the Board concludes that the 1.05 per cent. However, only in 1975 did Bank’s banking considerations involved in this proposal earnings exceed this figure and for each of the four present adverse factors bearing upon the financial previous years Bank earned between .3 and .9 per condition and future prospects of both Applicant and Bank. Such adverse factors are not outweighed by any procompetitive effects or by benefits which 3 Applicant proposes to exchange its shares of stock and $2.7 would result in serving the convenience and needs million of its 10 per cent debentures for all of the stock of of the community. Accordingly, it is the Board’s Bank and $600 thousand of Bank’s debentures ($300 thousand of which bears interest at 5.5 per cent, and the remainder of judgment that approval of the application would which bears interest at 7 per cent). Bank’s debentures would not be in the public interest and that the application be converted to equity capital in connection with this exchange. Applicant also proposes to borrow an additional $300 thousand should be, and hereby is, denied for the reasons to supplement Bank’s equity capital. summarized above. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

694 Federal Reserve Bulletin □ August 1976 By order of the Board of Governors, effective purpose of the transaction is to effect an eventual July 9, 1976. transfer of the ownership of Bank to the share­ holders of NBC Co. The nearest affiliates of NBC Voting for this action: Vice Chairman Gardner and Co. are located in Fremont, approximately thirty Governors Coldwell, Jackson, Partee, and Lilly. Absent miles northwest of Bank, and operate in a separate and not voting: Chairman Burns and Governor Wallich. banking market. There is no existing competition (Signed) J. P. Garbarini, between Bank and its potential affiliates. Accord­ [seal] Assistant Secretary of the Board. ingly, on the basis of the facts of record, the Board concludes that consummation of the proposal United Bancshares of Nebraska, Inc., would not have any adverse effect on other banks Lincoln, Nebraska in the relevant market and that competitive con­ siderations are consistent with approval of the Order Approving application. Formation of a Bank Holding Company The financial and managerial resources and fu­ United Bancshares of Nebraska, Inc., Lincoln, ture prospects of both Applicant and Bank are Nebraska has applied for the Board’s approval considered satisfactory in light of Applicant’s under § 3(a)(1) of the Bank Holding Company Act commitment to add $100,000 to Bank’s capital. (12 U.S.C. § 1842(a)(1)) of formation of a bank Although Applicant will incur acquisition debt in holding company through the acquisition of 99.2 connection with this proposal, it appears that it per cent or more of the voting shares of First will be able to service this debt over a 10-year Westroads Bank, Inc., Omaha, Nebraska period without impairing the financial condition of (“Bank”). Bank during that time. Furthermore, it appears that Notice of the application, affording opportunity the overall financial condition of the other onefor interested persons to submit comments and bank holding companies in which principals of views, has been given in accordance with § 3(b) Applicant are involved is satisfactory. Therefore, of the Act. The time for filing comments and views considerations relating to banking factors are con­ has expired, and the Board has considered the sistent with approval of the application. application and all comments received in light of Affiliation with Applicant should enable Bank the factors set forth in § 3(c) of the Act (12 U.S.C. to expand and improve the banking services it § 1842(c)). presently offers to its customers. Accordingly, Applicant is a nonoperating corporation organ­ these considerations relating to the convenience ized for the purpose of becoming a bank holding and needs of the community to be served are company through the acquisition of Bank. Bank consistent with approval. It is the Board’s judg­ (deposits of $12.3 million) ranks 18th out of the ment that consummation of the proposed transac­ 25 banks operating in the Omaha banking market tion would be in the public interest and that the (which is approximated by Douglas County) and application should be approved. controls 0.7 of 1 per cent of the total deposits On the basis of the record, the application is in commercial banks in the market.1 Upon acqui­ approved for the reasons summarized above. The sition of Bank, Applicant would control 0.2 of transaction shall not be made (a) before the thir­ 1 per cent of the total deposits in commercial banks tieth calendar day following the effective date of in Nebraska. this Order or (b) later than three months after the The principals of Applicant are also officers effective date of this Order unless such period is and/or directors of NBC Co., Lincoln, Nebraska, extended for good cause by the Board or by the a one-bank holding company that owns the Na­ Federal Reserve Bank of Kansas City pursuant to tional Bank of Commerce Trust and Savings As­ delegated authority. sociation, Lincoln, Nebraska. NBC Co. presently By order of the Board of Governors, effective is one of nine affiliated one-bank holding compa­ July 16, 1976. nies that individually own banks across the State Voting for this action: Vice Chairman Gardner and of Nebraska, collectively holding 7.3 per cent of Governors Wallich, Coldwell, Jackson, Partee, and the deposits in commercial banks in the State. The Lilly. Absent and not voting: Chairman Burns. 1 All banking data are as of June 30, 1975 and reflect holding (Signed) J. P. Garbarini, company formations and acquisitions approved by the Board through June 30, 1976. [seal] Assistant Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 695 First National Corporation, lead bank some 12 miles northeast in the town Appleton, Wisconsin of Greenville. Competition between that office and Bank—and between Applicant’s other subsidiary Order Approving Acquisition of Bank banks and Bank—does not appear to be signifi­ cant. Moreover, in view of the restrictive State First National Corporation, Appleton, Wiscon­ sin, a bank holding company within the meaning branching laws prohibiting the establishment of a of the Bank Holding Company Act, has applied branch within a three mile limit of Bank’s location for the Board’s approval under § 3(a)(3) of the and also in view of the rural character of the area Act (12 U.S.C. 1842(a)(3)) to acquire 90 per cent surrounding Bank, expansion by Applicant into or more of the voting shares of The Farmers State this portion of the market does not appear likely. Bank, Larsen, Wisconsin (“Bank”). The effects of the proposal on competition are Notice of the application, affording opportunity further mitigated by the relatively small size of for interested persons to submit comments and Bank and the fact that it has not been a significant views, has been given in accordance with § 3(b) competitor in the market. Bank was established of the Act. The time for filing comments and views in 1914 and its deposits have grown to only about has expired and the Board has considered the $9 million in some sixty years of operation. Ac­ application and all comments received in light of cordingly, on the basis of the facts of record, the the factors set forth in § 3(c) of the Act (12 U.S.C. Board concludes that consummation of the pro­ 1842(c)). posal would have some slightly adverse effects on Applicant, the ninth largest banking organi­ competition. zation in Wisconsin, controls six banks with ag­ The financial and managerial resources and fu­ gregate deposits of $179.5 million, representing ture prospects of Applicant, its subsidiaries, and approximately 1.2 per cent of the total deposits Bank are regarded as generally satisfactory. In in commercial banks in the State.1 Acquisition of arriving at such conclusion, the Board has relied Bank (deposits of approximately $9.3 million) in part on Applicant’s commitments to augment would not significantly increase Applicant’s share the capital at certain of its subsidiary banks. Con­ of deposits in the State nor would it alter Appli­ sequently, the Board regards banking factors as cant’s ranking among the other banking organi­ being consistent with approval of the application. zations in Wisconsin. Furthermore, Applicant’s acquisition of Bank Bank is the eleventh largest of twelve banking would give Bank access to Applicant’s banking organizations in the Appleton banking market2 and expertise and management resources. Applicant holds $9.3 million in deposits, which represents also proposes to assist Bank in providing new and 1.8 per cent of the total commercial bank deposits expanded services to its customers, including es­ in the market. Applicant is the largest of the twelve tate planning and trust services, investment advi­ banking organizations in the market, and upon sory services, computer services for both Bank and acquisition of Bank, Applicant would control four Bank’s customers, and direct leasing services. banks in the market with aggregate deposits repre­ Therefore, considerations relating to the conven­ senting 26.8 per cent of the total commercial bank ience and needs of the community to be served deposits in the market. Applicant and Bank operate lend weight toward approval and, in the Board’s in the same market, and the record indicates that view, outweigh any slightly adverse effects the some existing competition would be eliminated as proposal may have on competition. It is the a result of the consummation of the proposal. Bank Board’s judgment that the proposed acquisition is located on the western fringe of the relevant would be in the public interest and that the appli­ market in the town of Larsen and Applicant’s cation should be approved. closest banking office is a branch of Applicant’s On the basis of the record, the application is approved for the reasons summarized above. The transaction shall not be made (a) before the thir­ 1A11 banking data are as of December 31, 1975. tieth calendar day following the effective date of 2The Appleton RMA, which is the relevant banking market, this Order nor (b) later than three months after extends from the northeastern portion of Winnebago County (including the cities of Neenah and Menasha) through the the effective date of this Order, unless such period southeastern portion of Outagamie County (including the cities is extended for good cause by the Board, or by of Appleton, Kaukauna, Kimberly, Little Chute, and Com­ bined Locks) and the southwestern-most portion of Brown the Federal Reserve Bank of Chicago pursuant to County and the northwestern portion of Calumet County. delegated authority. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

696 Federal Reserve Bulletin □ August 1976 By order of the Board of Governors, effective control of Bank and the only other bank in the July 13, 1976. relevant market has led to common senior operat­ ing management and director interlocks. Because Voting for this action: Vice Chairman Gardner and of this affiliate relationship, the two banking insti­ Governors Coldwell, Partee, and Lilly. Absent and not tutions do not presently compete with each other. voting: Chairman Burns and Governors Wallich and Jackson. If the subject proposal is approved, it is expected that the affiliate relationship will be terminated and (Signed) J. P. Garbarini, Bank will become an independent alternative [seal] Assistant Secretary of the Board. source of banking services in the relevant market. On the basis of the facts of record, the Board Florida National Banks of Florida, Inc., concludes that competitive considerations are con­ Jacksonville, Florida sistent with, and lend some weight toward, ap­ proval of the application. Order Denying Acquisition of Bank The financial condition and future prospects of Florida National Banks of Florida, Inc. Florida National, its subsidiaries and Bank are (“Florida National”), Jacksonville, Florida, a regarded as satisfactory. Accordingly, the Board bank holding company within the meaning of the concludes that financial considerations are consist­ Bank Holding Company Act, has applied for the ent with approval of the application. Board’s approval under § 3(a)(3) of the Act (12 In the course of processing this application, the U.S.C. 1842(a)(3)) to acquire 50.37 per cent or following information has come to the Board’s more of the voting shares of the Citizens Bank attention. of Bunnell (“Bank”), Bunnell, Florida. (1) In May 1974 Florida National withdrew a Notice of the application, affording opportunity previous application it then had pending to acquire for interested persons to submit comments and 50.37 per cent of Bank.3 views, has been given in accordance with § 3(b) (2) In late May 1974, Florida National’s counsel of the Act. The time for filing comments and views (who was also a director of Florida National) has expired, and the Board has considered the conferred with members of the Board’s Legal application and all comments received in light of Division to discuss the possibility of preserving the factors set forth in § 3(c) of the Act (12 U.S.C. Florida National’s opportunity to acquire Bank by 1842(c)). having officers of Florida National purchase the Florida National, the fifth largest banking orga­ stock of Bank and hold it as individuals until such nization in Florida, controls 32 banks with aggre­ time as Florida National could purchase it from gate deposits of approximately $1.3 billion, repre­ them. senting 5.4 per cent of the total deposits in com­ (3) Subsequently, by letter of June 14, 1974, mercial banks in the State.1 Acquisition of Bank the Board’s Legal Division informed Florida Na­ would increase Florida National’s share of total tional’s counsel that “. . . any action to acquire commercial bank deposits by .04 per cent and shares of a bank by officers, directors or other would not result in a significant increase in the persons associated or related to a bank holding concentration of banking resources in Florida. company, without Board approval, should be Bank, the larger of the two banks in the relevant taken with extreme caution to insure that the bank banking market,2 controls total deposits of ap­ holding company does not obtain direct or indirect proximately $11 million representing 62.2 per cent of the total deposits in commercial banking insti­ 3Following the 1966 Amendments to the Act, the DuPont tutions in the market. The closest subsidiary bank Trust (“Trust”) sought to divest its holdings in 30 Florida of Florida National is 23 miles southeast of Bank. banks through an exchange of stock with a newly created bank holding company, Florida National. Subsequently, the Board No significant competition exists between any of determined that Trust was still controlling the 30 banks through Florida National’s subsidiary banks and Bank, and Florida National and by Order of October 15, 1973, the Board it appears unlikely that such competition would ordered the DuPont Trust to “terminate its control and/or controlling interest over Florida National and/or its subsidiary develop in the future. Common ownership and banks” by December 31, 1974. In May 1974, eight pending § 3(a)(3) applications of Florida National were returned be­ cause Trust had not yet complied with the Board’s Order of *A11 banking data are as of December 31, 1975. October 15, 1973; and therefore any acquisitions of bank shares 2 The relevant banking market is approximated by Flagler by Florida National would have constituted an indirect acqui­ County. sition by Trust. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 697 control or power to control or exercise a control­ guarantee the loan to its Officers4 and all of the ling influence over the bank.” other provisions of the Stock Purchase Agreement (4) On June 28, 1974, Florida National entered remain in force. into a Stock Purchase Agreement with three of (9) In response to a request by the Board’s staff its officers* (“Officers”) providing, in part, that that Florida National explain its actions, Florida Florida National, through one of its subsidiary National and its counsel provided documents and banks, would loan its Officers funds with which arguments in support of its position that its actions to purchase 50.37 per cent of the voting shares should not be deemed a willful violation of the of Bank. The Officers agreed to sell those shares Act. Florida National and its counsel argue, in to Florida National at a later date. In addition, part, that Florida National acted upon the advice “the entire risk of gain or loss on the transactions” of counsel; that Florida National’s agreement with was upon Florida National. Florida National also its Officers had been structured to comply with agreed to indemnify its Officers against loss in the prior holdings of the Board in similar cases; and event it was unable to purchase the shares from that, at worst, the transaction was a technical them. violation of the Act. (5) Inquiries by the Board’s Legal Division in Section 3(a) of the Act provides that it shall October 1974 resulted in a letter dated October be unlawful, except with the prior approval of the 7, 1974, from Florida National’s counsel commit­ Board “. . .(3) for any bank holding company ting Florida National and its Officers to (a) remove to acquire direct or indirect ownership or control the loan from Florida National’s subsidiary bank of any voting shares of any bank if, after such to an unaffiliated bank, (b) cancel, rescind, and acquisition, such company will directly or indi­ render void and unenforceable the Stock Purchase rectly own or control more than 5 per centum of Agreement of June 28, 1974, and (c) enter into the voting shares of such bank.” Section 2(a)(2) a new Stock Purchase Agreement “which would (A) of the Act provides that any company has be consistent with the Board’s staff’s recom­ control over a bank or over any company if “(A) mendations and which would provide no indemni­ the company directly or indirectly or acting fication.” through one or more other persons owns, controls, (6) Florida National subsequently placed the or has power to vote 25 per centum or more of loan with an unaffiliated bank. However, Florida any class of voting securities of the bank or com­ National agreed to guarantee the loan. pany.” (7) On May 1, 1975, Florida National submitted It appears that, contrary to the specific recom­ an application for prior approval to acquire 50.37 mendations and views expressed by the Board’s per cent of the outstanding voting shares of Bank Legal Division, Florida National, acting through from its Officers who had acquired the shares from its Officers, acquired control of 50.37 per cent of Bank’s principal shareholder. Bank’s outstanding voting shares. Florida National (8) During processing of the application, staff was instructed by the Board’s Legal Division not discovered that the Stock Purchase Agreement to finance its Officers’ purchase of Bank’s shares, between Florida National and its Officers had not not to guarantee any loan made to its Officers by been “cancelled and rescinded and rendered void an unaffiliated bank and not to indemnify its Of­ and unenforceable from the beginning” and was ficers against loss. Despite these directions and in fact still in force. The only step that had been Florida National’s awareness of the Board’s pub­ taken by Florida National in fulfillment of the licly expressed concern with acquisitions by of­ commitments listed in the aforementioned October ficers of holding companies acting to preserve 7th letter was the transfer of the loan to Officers corporate opportunities,5 and without apparent from Florida National’s subsidiary bank to an concern for the consequences of its actions, unaffiliated bank. Florida National continues to Florida National nevertheless structured the trans­ action in a manner that clearly resulted in its acquiring control of Bank. Moreover, Florida Na­ *Two of the officers were also directors of Florida National. tional continues to guarantee the loan to its Of- 4 At the time Florida National placed the loan with the unaffiliated lender, American National Bank of Jacksonville, it continued to guarantee the loan to its Officers. When Florida National subsequently sought to remove its guarantee of the 5See Mid America Bancorporation, Inc., 1974 Federal loan, American National Bank of Jacksonville refused to ex­ Reserve Bulletin 131; The Jacobus Company and Inland cuse Florida National from its obligation. Financial Corporation, 1974 Federal Reserve Bulletin 130. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

698 Federal Reserve Bulletin □ August 1976 ficers and to indemnify those Officers against loss, of itself, constitutes grounds for denial of such and the control relationship thus continues. an application. On the basis of the facts of record, the Board In view of the repeated warnings of the Board’s concludes that Florida National controls Bank Legal Division cautioning Florida National’s within the meaning of § 2(a)(2)(A) of the Act. counsel to exercise great care in structuring the The Board further concludes that Florida National transaction whereby Officers acquired control of violated § 3(a)(3) of the Act by acquiring control Bank, the contradictory statements made by of Bank without the prior approval of the Board. Florida National’s counsel to the Legal Division, Among the factors enumerated in § 3(c) of the the apparent misrepresentations made in connec­ Act that the Board must consider in acting on tion with the application, and Florida National’s applications is the managerial resources of the continued failure to comply with the Board’s acquiring bank holding company. The reference staff’s recommendations for remedying the situa­ to “managerial resources” does not, however, tion, it is clear that insofar as this application is refer solely to the business abilities of management concerned the management of Florida National has or its past financial success. The legislative history not demonstrated a disposition to conform the of this provision makes it clear that this factor conduct of Applicant’s affairs to the requirements relates not only to management’s competence but of the Act. Section 3(a) of the Act requires prior also to management’s integrity and disposition to approval for acquisitions, and where an acquisition conduct the affairs of the company in accordance of control is made without obtaining such prior with the requirements of law.6 approval, under circumstances such as those pre­ In assessing the managerial resources of an sented here, the Board believes it should not applicant, the Board must consider all the factors approve an application to retain the illegally ac­ that bear upon the competence, quality and integ­ quired control position and thereby allow the of­ rity of the management of any holding company fending party to reap the fruits of its violation. seeking to acquire control of a bank. The Board There is no evidence in the record that the has previously stated that when it comes to the banking needs of the community are not currently Board’s attention that an acquisition has been being adequately served. Florida National has made, or activities have been commenced, without proposed to expand certain of Bank’s services. the requisite prior approval of the Board, whether However, in the context of this application, these or not such violation of the law appears to have considerations are not sufficient to outweigh the been “willful,” such conduct may reflect so ad­ adverse managerial considerations of Florida Na­ versely upon the managerial factors in connection tional’s violation of the Act referred to above. with an application for permission to retain the Accordingly, it is the Board’s judgment that ap­ illegally acquired activity that the conduct, in and proval of the application would not be in the public interest and that the application should be denied. On the basis of the record, the application is denied for the reasons summarized above. Florida 6As originally enacted, § 3(c)(3) of the Bank Holding National and its Officers are ordered to take all Company Act provided that among the factors to be considered by the Board is the “character of [the] management”. Also necessary steps to divest the shares of Bank un­ see Senate Report No. 1095, 84th Cong., 1st Sess., at page lawfully acquired by them no later than October 10, accompanying the 1956 Act. The present § 3(c) of the 27, 1976 and to submit to the Board for its Act includes the same standard without any substantive change in its meaning having been made by the 1966 Amendments approval no later than August 29, 1976, a plan to the Act which brought this section into harmony with the to effect such divestiture. Bank Merger Act. The Federal Home Loan Bank Board has By order of the Board of Governors, effective had occasion in a similar context to consider the scope of the “managerial resources” standard as contained in that section July 29, 1976. of the National Housing Act dealing with savings and loan holding companies (12 U.S.C. § 1730a(e)(2)). The Bank Board concluded that its standard was adopted from the Bank Holding Company Act and that the phrase “managerial re­ Voting for this action: Vice Chairman Gardner and sources” encompasses considerations relating to the integrity Governors Wallich, Partee, and Lilly. Absent and not of management. Opinion and Order of the Home Loan Bank Board in the matter of the Joint Applications of Fidelity voting: Chairman Burns and Governors Cold well and Financial Corporation and Fidelity Savings and Loan Associ­ Jackson. ation, Sacramento, California, and Six Rivers Savings and Loan Association, Eureka, California (Resolution No. 73- (Signed) J. P. Garbarini, 1772, December 7, 1973), at page 20. [seal] Assistant Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 699 Indian Head Banks Inc., $6.3 million3 representing 8.4 per cent of total Nashua, New Hampshire deposits in commercial banks in the market, and thus Applicant is the eighth largest banking orga­ Order Approving nization in the relevant banking market. As a result Acquisition of Shares of Bank of consummation of the proposed transaction, Ap­ plicant would become the largest banking organi­ Indian Head Banks Inc., Nashua, New Hamp­ zation in the relevant market with 17.8 per cent shire, a bank holding company within the meaning of deposits in commercial banks. Thus the pro­ of the Bank Holding Company Act, has applied posed transaction would have the effect of in­ for the Board’s approval under § 3(a)(3) of the creasing somewhat the concentration of banking Act (12 U.S.C. § 1842(a)(3)) to acquire 67 per resources in the relevant market. However, even cent or more of the voting shares of Community after consummation of the proposed transaction, National Bank of Rochester, Rochester, New the market would not be highly concentrated as Hampshire. the four largest banking organizations would con­ Notice of the application, affording opportunity trol 60.7 per cent of deposits in the market. The for interested persons to submit comments and effect of the proposal on concentration in the views, has been given in accordance with § 3(b) relevant market is mitigated by the facts that Bank of the Act. The time for filing comments and views and Exeter Bank are among the smaller organi­ has expired, and the Board has considered the zations in the market and that, because Bank is application and all comments received, including in less than satisfactory condition, it is not cur­ those submitted by Strafford National Bank, rently a meaningful competitor in the market. Dover, New Hampshire (“Protestant”), in light Indeed, affiliation with Applicant should enable of the factors set forth in § 3(c) of the Act (12 Bank to become a competitive factor in the market. U.S.C. § 1842(c)). Accordingly, it is the Board’s judgment that the Applicant, the largest banking organization in proposal would be consistent with the public in­ New Hampshire, controls 8 banks with aggregate terest despite its effects on concentration in the deposits of approximately $255 million, repre­ market. senting 15.4 per cent of total deposits in commer­ To the extent that Bank and Exeter Bank’s cial banks in New Hampshire.1 Acquisition of Newmarket branch operate in the Dover-Rochester Bank (deposits of approximately $7 million) would banking market, some amount of existing compe­ increase Applicant’s share of Statewide deposits tition would be eliminated as a result of consum­ by .4 of one per cent. Consummation of the mation of this proposal. However, on the basis proposed transaction would not result in a signifi­ of the facts of record, including the facts that Bank cant increase in the concentration of banking re­ and Exeter Bank’s Newmarket branch are 18 miles sources in New Hampshire. apart and that a number of banks compete in the Bank is the 6th largest of 10 commercial bank­ market, it does not appear that any meaningful ing organizations in the Dover-Rochester banking competition between Bank and Exeter Bank would market (the relevant banking market for purposes be eliminated as a result of the proposal, particu­ of this proposal)2 and controls 9.4 per cent of larly in view of the current financial condition of deposits in commercial banks in the market. A Bank. Applicant’s other subsidiaries also have five subsidiary of Applicant, Indian Head National banking offices located outside the relevant market Bank of Exeter (“Exeter Bank”), Exeter, New that derive some deposits from Bank’s service Hampshire, operates a branch in Newmarket, New area. The amount of such deposits, however, is Hampshire, located in the relevant banking mar­ not significant nor does Bank derive a significant ket. That branch holds deposits of approximately amount of deposits from the service areas of these subsidiaries of Applicant. After consummation of the proposal, several independent banks would Unless otherwise indicated, banking data are as of De­ remain available for acquisition by holding com­ cember 31, 1975. panies not represented in the market. Accordingly, 2 The Dover-Rochester banking market is approximated by the Board concludes that consummation of the all of Strafford County, New Hampshire, the towns of Not­ tingham and Newmarket in Rockingham County, New Hamp­ shire, the towns of Brookfield and Wakefield in Carroll County, New Hampshire, and the towns of Lebanon, Berwick and South Berwick in York County, Maine. 3As of June 30, 1974. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

700 Federal Reserve Bulletin □ August 1976 proposal would not eliminate any significant exist­ of an additional banking office would further re­ ing competition or foreclose the development of duce that average. With regard to the possible potential competition. affiliation of Bank with an organization, the effects The financial condition and managerial re­ of which affiliation would be less anticompetitive, sources of Applicant and its subsidiaries are con­ it is noted that State law requires that the principal sidered satisfactory and their future prospects ap­ offices of merging banks be within 30 miles of pear favorable. Bank’s financial condition, mana­ each other.5 Thus, the merger of Bank with any gerial resources and future prospects, absent con­ other institution would likely have at least some summation of the instant proposal, are less than adverse effect on competition.6 Besides Applicant, satisfactory. However, Applicant has agreed to there are only three other bank holding companies inject needed capital of approximately $200,000 in New Hampshire. Two do not appear to possess into Bank and intends to revamp the management sufficient resources to acquire the shares of Bank of Bank. Thus, banking factors lend some weight sought by Applicant, and any such acquisition by toward approval of the application. Affiliation with the third would present essentially the same com­ Applicant should enable Bank to provide more petitive consequences as the instant proposal. The effectively services it has been forced by its wea­ Board is of the view that the mere existence of kened financial condition to reduce. In addition, other institutions with which Bank could conceiv­ as a result of the proposal, Bank will offer accounts ably become affiliated, does not warrant denial of subject to negotiable orders of withdrawal (so- the subject application. called “NOW accounts”) paying interest on bal­ In the course of its consideration of the subject ances in excess of $500, free checking accounts application, the Board has also noted the existence for individuals over 62 years of age, expanded of a bank management consulting agreement be­ savings and retirement account services, dealer tween a subsidiary of Applicant, Indian Head Bank floor planning services and accounts receivable Services Corporation (“IHBS”),7 and Bank. Ac­ financing. Therefore, considerations relating to cording to that agreement, IHBS provides Bank convenience and needs of the community to be with a full-time on-site consultant who is author­ served lend weight toward approval of the appli­ ized to initiate new loans of less than $5,000, “to cation and, in the Board’s view, outweigh any do all things appropriate to the collection of loans slight adverse competitive effects that might result charged off or past due” and “to do all things from consummation of the proposal. necessary to administer the day-to-day operation In its consideration of the subject application, of [Bank] but not including the execution of con­ the Board has considered the comments submitted tracts on behalf of [Bank] or the hiring or removal by Protestant. Protestant has asserted that con­ of personnel.” It appears that IHBS may be pro­ summation of the proposal would result in adverse viding Bank with services on a daily or continuing competitive effects that are not outweighed in the basis contrary to the proscription contained in public interest by the effects the proposal would Footnote 9 to § 225.4(a)(12) of Regulation Y have on the convenience and needs of the com­ which provides in pertinent part: “In performing munity. Specifically, Protestant contends, first, this activity [bank management consulting] bank that Applicant should have chosen to establish a holding companies are not authorized to perform de novo office rather than to acquire an existing tasks or operations or provide services to client institution and, second, that there exist less anti­ banks either on a daily or continuing basis, except competitive alternatives for the affiliation of Bank with another viable banking organization. With regard to possible de novo entry by Applicant, 5See New Hampshire RSA, 384-B:2(II). Protestant disregards the fact that Applicant’s sub­ 6Protestant, currently the largest banking organization in the sidiaries are precluded by New Hampshire law market, previously entered into merger negotiations with Bank and secured regulatory approval to merge with Bank. That from opening branches in the town of Rochester.4 merger, which was never consummated, would have produced Furthermore, the ratio of deposits per banking a banking organization holding 26.6 per cent of the market’s office in the relevant market is already consid­ deposits. 7On October 25, 1974, the Board approved Applicant’s erably below the Statewide average. Introduction application to acquire IHBS [39 Federal Register 39107], a company which engages in the permissible nonbanking activity of providing management consulting advice to nonaffiliated banks (section 225.4(a)(12) of Regulation Y, 12 CFR 225.4(a) 4 See New Hampshire RSA, 384-B:2(I). (12)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 701 as shall be necessary to instruct the client bank Order Denying on how to perform such services for itself” (em­ Extension of Time for Divestiture phasis added). The Board has scrutinized the cir­ First Security Corporation, Salt Lake City, Utah cumstances of Applicant’s involvement with Bank (“FSC”), a bank holding company within the including the financial and managerial resources meaning of the Bank Holding Company Act of Bank, the fact that the Federal Reserve Bank (“Act”), has tendered an application for the of Boston was consulted by Applicant prior to its Board’s approval under § 4(c)(8) of the Act (12 entering into the agreeement with Bank and the U.S.C. § 1843(c)(8)) and § 225.4(b)(2) of the fact that Applicant entered into the agreement at Board’s Regulation Y (12 CFR § 225.4(b)(2)), to the insistence of Bank, and has concluded that the retain 100 per cent of the voting shares of First facts surrounding Applicant’s involvement with Security Savings and Loan Association, Pocatello, Bank do not warrant denial of the subject applica­ Idaho (“FSS&L”), a company engaged in the tion. Accordingly, the Board has proceeded to business of operating a savings and loan associa­ consider the subject application on its merits and, tion. Although FSC is subject to an outstanding on that basis, concludes that approval of the pro­ Order of the Board to effect divestiture of FSS&L, posal would be consistent with the public interest. it has not done so, and it is apparently of the view The Board, nevertheless, believes it appropriate that the tender of the application tolls the time to set forth for the record its view that transactions for divestiture. For the reasons set forth below, of the type described above may justify a finding the Board denies any further extension of the time that a company has violated the Bank Holding for divestiture of FSS&L by FSC, and, accord­ Company Act. Bank holding companies engaging ingly, will not process the tendered application. directly or indirectly in the activity of providing FSC is a multi-State, multi-bank holding com­ management consulting advice to nonaffiliated pany whose predecessor (“Old FSC”) was orga­ banks, should avoid entering into relationships nized in 1928. Old FSC was, at the time of the with client banks that exceed the scope of section enactment of the Bank Holding Company Act of 225.4(a)(12), even when such bank may be ex­ 1956, engaged in both banking and nonbanking periencing financial or managerial difficulties. activities (including the operation of FSS&L) in Particular caution should be exercised where a the States of Idaho, Utah, and Wyoming. As' a bank holding company contemplates the subse­ result of the 1956 Act, Old FSC was required to quent acquisition of the client bank. divest of its impermissible nonbanking activities, On the basis of the record, the application is including FSS&L. However, these activities were approved for the reasons summarized above. The held until 1959 when Old FSC took steps to divide transaction shall not be made (a) before the thir­ its bank and nonbank assets (the latter including tieth calendar day following the effective date of FSS&L) among two corporations—FSC, which this Order or (b) later than three months after the came to hold the bank assets, and First Security effective date of this Order, unless such period Investment Company (“FSIC”), a company hold­ is extended for good cause by the Board, or by ing the impermissible nonbank activities of Old the Federal Reserve Bank of Boston pursuant to FSC. The division was accomplished through a delegated authority. pro-rata “spin-off” of the company controlling the By order the Board of Governors, effective July bank assets. Following this “spin-off” there ex­ 28, 1976. isted and continued to exist not only a substantial Voting for this action: Chairman Burns and Gover­ identity of ownership, but significant officer and nors Gardner, Wallich, Partee, and Lilly. Absent and director interlocks between FSC and FSIC.1 not voting: Governors Cold well and Jackson. On September 30, 1969, FSIC contracted to sell (Signed) J. P. Garbarini, FSS&L to U.I.P. Corporation, Milwaukee, Wis­ [seal] Assistant Secretary of the Board. consin (“UIP”),2 contingent upon UIP obtaining the necessary Federal Home Loan Bank Board Orders Under Section 4 Of Bank Holding Company Act ^SC and FSIC had the same president and chief executive officer, and three of FSIC’s directors were on the board of First Security Corporation, FSC. 2 UIP was a diversified non-operating holding company en­ Salt Lake City, Utah gaged in the finance and industrial fields. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

702 Federal Reserve Bulletin □ August 1976 (“FHLBB”) approval. The contract of sale pro­ direct or indirect interest in and control over vided that an escrow agent, First Security Bank FSS&L by no later than November 1, 1976. FSC of Utah, N.A, Salt Lake City, Utah, FSC’s own is further directed to file a plan of divestiture with lead bank, would hold the shares of FSS&L pend­ the Board by no later than September 15, 1976. ing consummation of the sale. The contract further Divestiture shall be accomplished in such a manner provided that the escrow agreement was to be that neither FSC nor any successor thereto will terminated on June 30, 1970, if regulatory ap­ exercise or be capable of exercising any direct or proval were not obtained. indirect control or controlling influence over On April 1, 1970, while the UIP application FSS&L, its management or policies. for FHLBB approval was still pending and FSIC By order of the Board of Governors, effective was still the owner of the FSS&L shares, FSIC July 30, 1976. and FSC merged. FSC thereby became the owner Voting for this action: Vice Chairman Gardner and of FSS&L’s shares in clear violation of the Bank Governors Wallich, Partee, and Lilly. Absent and not Holding Company Act.3 It was not until six voting: Chairman Burns and Governors Coldwell and months later, on September 30, 1970, that the Jackson. FHLBB denied UIP’s application to acquire (Signed) Griffith L. Garwood, FSS&L. Following that denial, the escrow was [seal] Assistant Secretary of the Board. terminated, and all rights with respect to the FSS&L shares reverted to the merged company. Mellon National Corporation, In June 1971, after the Federal Reserve Bank of San Francisco became aware of the unlawful Pittsburgh, Pennsylvania reacquisition of FSS&L by FSC, it advised FSC Order Approving to divest FSS&L “as soon as possible.” Later in Acquisition of Local Loan Company 1971, however, FSC filed an application with the Board for permission to retain FSS&L. On August Mellon National Corporation, Pittsburgh, Penn­ 21, 1972, the Board returned this application sylvania, a bank holding company within the without acting upon it and directed FSC to initiate meaning of the Bank Holding Company Act, has steps to dispose of FSS&L “as soon as practica­ applied for the Board’s approval, under §4(c)(8) ble.” In its letter the Board stated that it had of the Act (12 U.S.C. §1843(c)(8)) and decided not to include operation of a savings and §225.4(b)(2) of the Board’s Regulation Y (12CFR loan association on its list of permissible activities §225.4(b)(2)), to acquire 100 percent of the voting at that time. FSC has nevertheless continued to shares of Local Loan Company (“Local”), Chi­ retain its ownership of FSS&L. cago, Illinois, a company that, directly and Based on the foregoing and other facts of through 19 wholly-owned subsidiaries, engages in record, the Board has determined that FSC has the activities of a consumer finance company by held FSS&L in clear violation of the Act since making secured and unsecured consumer instal­ the merger of FSC and FSIC in April 1970. ment loans and by purchasing consumer instalment Because of this violation, the separation of FSC’s sales finance contracts. Local also acts as agent banking and impermissible nonbanking assets that or broker for the sale of credit life, accident and was required when the Act was passed in 1956 health insurance, directly related to its extensions has been frustrated. For the Board to extend the of credit. Such activities have been determined by time for divestiture further, or to consider approv­ the Board to be closely related to banking (12 CFR ing retention of FSS&L by FSC would serve only §§225.4(a)(1) and (9)). to encourage violations of the Act and delays in Notice of receipt of the application, affording effecting divestiture by other bank holding com­ opportunity for interested persons to submit com­ panies. Accordingly, FSC is denied any further ments and views with respect to the proposed extension of the time for divesting FSS&L and transaction, was published in the Federal Register is hereby ordered to divest itself of any and all (39 Federal Register 42719) on December 6, 1974. By letter dated January 6, 1975, Mr. An­ 3By this merger, FSC apparently also violated § 408(e)(1) thony R. Martin-Trigona (“Protestant”), Chicago, (B) of the National Housing Act, 12 U.S.C. § 1730a(e)(l) Illinois, requested the Board to hold a formal (B), inasmuch as the merger resulted in FSC becoming a savings and loan holding company without prior approval of hearing on the subject application. Applicant re­ the FHLBB. sponded by challenging the timeliness of Mr. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 703 Martin-Trigona’s request for a hearing and his response thereto, has determined that the Admin­ standing. Following an exchange of corre­ istrative Law Judge’s findings of fact, conclusions spondence and an informal hearing concerning Mr. and recommendations, as modified and supple­ Martin-Trigona’s standing, the Board, by Order mented herein, are fully supported by the evidence dated July 28, 1975 (40 Federal Register 33072), of record and should be adopted as the findings directed that a public hearing be held with respect and conclusions of the Board. Accordingly, the to the application, the issue to be considered at Board now makes its findings as to the facts, its said hearing to be whether the proposed acquisition conclusions drawn therefrom, and its Order.2 can reasonably be expected to produce benefits to Applicant is the largest banking organization in the public, such as greater convenience, increased Pennsylvania and the sixteenth largest banking competition, or gains in efficiency that outweigh organization in the United States. Applicant con­ possible adverse effects, such as undue concentra­ trols Mellon Bank, N.A., Pittsburgh, Pennsyl­ tion of resources, decreased or unfair competition, vania, (“Bank”), which holds domestic deposits conflicts of interests, or unsound banking prac­ of $5.1 billion, representing approximately 12 per tices. While the Board was skeptical concerning cent of the total deposits in commercial banks in Mr. Martin-Trigona’s claim of standing as a pos­ Pennsylvania.3 Applicant controls no other bank­ sible entrant into the consumer finance business, ing subsidiaries but does control nonbanking com­ the Board expressly reserved judgment on that panies engaged in equipment leasing on a full question and determined to permit Mr. Martin- pay-out basis, real estate financing and mortgage Trigona to participate in the hearing. banking. The hearing, held in accordance with the Local, the seventieth largest consumer finance Board’s Rules of Practice for Formal Hearings (12 company in the country in terms of capital funds, CFR Part 263), commenced on September 3, is a moderately sized, multi-regional consumer 1975, in Washington, D.C., with proceedings held finance company with net consumer finance re­ thereafter on September 4-6, 29 and 30, October ceivables of $82.4 million. Local engages 1-3, 6-7, 9-10, and November 11, 1975. On principally in making direct instalment loans to November 24, 1975, the Administrative Law individuals. Of its total receivables, 82 per cent Judge, over Protestant’s untimely objection,1 are derived from this activity. The balance of its closed the proceedings. A substantial record on receivables consist of purchased consumer instal­ the application was developed through extensive ment sales finance contracts. cross-examination by Protestant of Applicant’s Local operates 124 offices in twelve States,4 witnesses and through numerous exhibits submit­ with approximately 55 per cent of its business ted by all parties to the proceedings. generated in the four western States of California, In a Recommended Decision dated March 11, Colorado, Oregon, and Washington in which 1976, the Administrative Law Judge concluded Local has 72 of its offices. Local derives an addi­ that consummation of the proposed acquisition of tional 30 per cent of its business from the States Local by Applicant “can reasonably be expected of Illinois and Wisconsin, in which it has 32 to produce benefits to the public that outweigh offices. The balance of Local’s business is derived possible adverse effects within the meaning of from 20 offices in Florida, Indiana, Kentucky, section 4(c)(8) of the [Bank Holding Company] Minnesota, Nebraska, and New York. Act.” Accordingly, the Administrative Law Judge The relevant product lines to be considered in recommended that the Board of Governors ap­ evaluating the competitive effects of this proposal prove the subject application. are direct personal instalment loans and purchased The Board, having considered the entire record consumer sales finance contracts. The geographic of the hearing, including the transcript, exhibits, rulings, briefs filed in connection with the hearing, 2Protestant’s numerous objections to the manner and conduct and the Recommended Decision filed by the Ad­ of the administrative proceedings as well as certain other ministrative Law Judge, together with Protestant’s matters raised by Protestant in motions and petitions to the Board are dealt with in the Appendix to this Order. The Exceptions and Applicant’s and Board Counsel’s Appendix is incorporated herein and made a part of this Order. 3Unless otherwise noted, all financial data are as of June 30, 1975. 4In four States (California, Illinois, Kentucky, and Indiana), Local solicits direct consumer loans by mail through its sub­ *See Appendix to this Order, p. 709. sidiary, Mario Finance Company. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

704 Federal Reserve Bulletin □ August 1976 market for direct personal instalment loans is con­ of these consumer loans was directly solicited by sidered to be local in nature.5 Although it is Bank, but rather was the result of Bank borrowers possible to engage in the purchasing of sales moving from the Pittsburgh banking market to a finance contracts over an unlimited geographic Local service area or resulted from credit accom­ area, Local generally purchases such contracts modations being granted to users of Bank’s other from dealers located in Local’s service areas as services residing in Local’s markets. Thus, since a means of attracting new customers for its direct there is no meaningful geographic overlap between loan services. In view of the limited nature of the services offered by Applicant and Local, con­ Local’s credit-related insurance activities, the summation of the proposal would not eliminate Board finds that no significant existing or potential any significant existing competition in any relevant competition with respect to such insurance activi­ market. ties would be eliminated upon consummation of With respect to the question of whether con­ this proposal. summation of the proposal would eliminate any Applicant, through the 102 branch offices of significant competition in the future, Applicant has Bank, makes substantially all of its consumer loans evidenced within the past few years a desire to in the six-county metropolitan area of Pittsburgh,6 expand its activities. This has been manifested in some 350 miles distant from the closest Local its establishment of a corporate management team service area. Bank also purchases consumer sales to plan and guide expansion, the sizeable growth finance contracts from dealers outside its market. and diversification of the subsidiary bank’s activ­ However, none of these dealers, except for mobile ities both domestically and in the foreign area, and home servicing companies,7 is located in any of Applicant’s entry, either de novo or by acquisition, the markets Local serves. As of June 30, 1974, into a number of nonbanking endeavors. Further­ Bank’s total consumer credit extensions amounted more, considering Applicant’s extensive re­ to $360 million, representing approximately 4 per sources, its stated view as to the importance to cent of its total assets and 9 per cent of its total its structure of a consumer finance subsidiary, and loans. Of this amount, about $1 million (including the relatively low barriers to entry into the in­ both direct consumer loans and purchased sales dustry, the Board believes it reasonably likely that, finance contracts) or less then .5 per cent of Bank’s absent approval of the instant application, Appli­ total consumer credit resulted from loans extended cant might well within the foreseeable future enter to residents of Local’s markets. In addition, none the consumer finance business, if not de novo,8 then through the acquisition of one or more smaller consumer finance companies, coupled with some de novo expansion. 5Protestant has excepted to the Administrative Law Judge’s In this connection, the Board does not agree acceptance of Applicant’s delineation of Local’s 38 service areas as overbroad, contending that the relevant geographic with the Administrative Law Judge’s charac­ markets are the narrowly localized or directly impacted areas. terization of Applicant’s proposed acquisition of The Board is satisfied from its review of the technique Appli­ cant used to define the markets that the Administrative Law Local as a foothold entry into the consumer finance Judge’s findings as to the geographic boundaries of the markets industry. While Local is clearly not one of the are substantially correct. In this regard, the Board has pre­ larger firms in the industry as a whole, it is one viously determined consumer finance markets to be roughly equivalent to commercial banking markets. Measured against this standard, the Administrative Law Judge’s market defini­ tions appear in certain cases to be too narrow, rather than as 8 Applicant has submitted evidence indicating that although Protestant suggests overbroad. With respect to the Administra­ it has studied in detail the feasibility of a de novo entry into tive Law Judge’s definition of the Los Angeles, California the industry, it has rejected such entry as unwise and imprudent market, to which Protestant specifically objects, the Board has because of the need to hire and train a large staff, the problems previously determined that market to be even broader than that and difficulties of locating growth sites for offices, licensing found by the Administrative Law Judge. In any event, any requirements, its lack of experience in the industry, and the error in market definition is viewed by the Board as insig­ significant funds and time required to implement such entry, nificant in light of its findings with respect to the overall much less reach a breakeven point. The Administrative Law competitive effects of the proposal. Judge concluded that the record would not warrant a finding 6 Applicant’s subsidiary Mellon National Mortgage Company that Applicant should be perceived as a de novo entrant into of Ohio, while engaged primarily in mortgage banking, also the industry. However, Applicant’s study and rejection of de engages to a very limited extent (less than . 1 per cent of its novo entry into the consumer finance industry does not preclude total assets) in consumer loan activities through its second Applicant’s entry by foothold acquisition. Indeed, following mortgage lending operations. All of these loans are on proper­ rejection of de novo entry, Applicant’s corporate planning ties located in Ohio, and Local has no market that extends group considered and studied the acquisition of some 15 into Ohio. consumer finance companies prior to focusing attention upon 7Local does not operate in this product sub-market. Local. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 705 of the larger of the few remaining independent that the acquisition, which constitutes Applicant’s consumer finance companies in the country. In initial entry into the consumer finance business, addition, Local has achieved a more than insig­ will provide it with expertise and a market position nificant presence among consumer finance compa­ from which to successfully and vigorously com­ nies in certain of the markets in which it operates.9 pete in the industry and thereby, in the Board’s While the Board cannot conclude that Appli­ view, increase competition and serve the public cant, absent approval of the instant application, interest. would enter any particular market either de novo The Board notes that Bank, as of June 30, 1974, or through acquisition of a smaller consumer fi­ had credit commitments of $456 million and loans nance company, the Board is nevertheless of the outstanding of $118 million to 59 consumer fi­ view that consummation of the proposal would nance companies, some of which compete with result in the elimination of some potential compe­ Local. Since Applicant has assured the Board that tition. However, that loss is regarded by the Board Bank’s lending policies toward such companies as very slight, since Applicant will not gain a will not change if the application is approved, the substantial share of the consumer loan business Board concludes that consummation of the pro­ in any of the markets presently served by Local posal will not result in any unfair competition. and in view of the size and large number of With respect to whether consummation of the financial institutions already competing in these proposal would involve an unsound banking prac­ markets as well as the number of available poten­ tice, the Administrative Law Judge concluded that tial entrants and the low barriers to entry. both Applicant and Local were prudent and con­ Each of the markets in which Local operates servative institutions and that approval of the ac­ contains numerous competitors, including in quisition would not lead to unsound banking. nearly all cases many of the largest consumer Protestant argues, without any apparent or speci­ finance companies in the United States as well as fied support in the record, that the proposed ac­ other finance companies larger in receivables and quisition and Applicant’s growth plans for Local capital funds than Local. Moreover, in each of will adversely affect the capital position and earn­ its markets Local competes with a significant ings of Applicant. number of credit unions and commercial banks. As of June 30, 1975, Applicant had total assets As a result, Local’s share of the individual markets of $9.2 billion and equity capital and valuation in which it operates is small, ranging from .21 reserves of $698 million. Its earnings for the first per cent to 4.38 per cent, with a median of 1.37 half of 1975 were $33.7 million, an increase of per cent. In the Los Angeles and Chicago markets, 14.5 per cent over the comparable 1974 period. from which Local derives about 30 per cent of Applicant’s ratio of equity capital to non-cash its receivables and in which it operates 31 offices, assets is 9.5 per cent, which is the second highest Local’s share of the consumer loan market (in­ of the thirty largest bank holding companies in cluding direct consumer loans and purchased con­ the country. Applicant’s ratio of consolidated lia­ sumer sales finance contracts) is .47 per cent and bilities to equity capital and valuation reserves is .94 per cent, respectively. In no market does Local 12.2:1 and is considered by the Board to be appear to have a dominant position in any product conservative. During the five-year period ending line in which it operates. December 31, 1974, Applicant’s consolidated As discussed more fully below, any adverse assets increased by 90 per cent, its consolidated effect of the proposal on potential competition is net income by 26 per cent, its domestic and foreign further and substantially mitigated by the lack of deposits by 71 per cent, and its total equity capital competitive aggressiveness exhibited by Local’s by 21 per cent. During the same period, Applicant present management and policies,10 and the fact maintained one of the highest equity to asset ratios of the nation’s large bank holding companies. 9 While Local’s presence among consumer finance companies Applicant also ranks high among comparable is viewed as more than insignificant in certain of its markets, bank holding companies in terms of certain other Local’s share of the consumer loan business in any such market generally accepted standards for measuring capital is small because of the additional competition from banks and credit unions. adequacy, earnings performance and loan loss 10In view of Local’s almost complete lack of geographic coverage and experience. In 1974, Bank, which expansion over the last decade or more, the Board concludes accounts for about 96 per cent of Applicant’s that Local should not be perceived as a potential entrant into Bank’s market. consolidated assets, was first among the nation’s Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

706 Federal Reserve Bulletin □ August 1976 18 banks with deposits in excess of $5 billion in Local’s rate of net loan write-offs has been less terms of its ratio of earnings to assets. In this than average from 1970 through 1973. In addition, group, Bank also had the second highest ratio of Local’s loan loss reserve has in recent years been equity capital and reserves to assets and to risk more than adequate to cover its actual loan losses, assets, and the highest loan loss coverage and despite Local’s policy of charging off as worthless lowest ratio of net charge-offs to total loans. Dur­ at year end generally all instalment receivables on ing the period 1970-1974, Applicant’s ratio of net which no payment has been received in the 90-day charge-offs to average loans outstanding was .16, period ending November 30 of each year. the fourth lowest in its peer group. In connection with managerial considerations Applicant proposes to pay $30 million in cash the Board notes that Local’s present management for 100 per cent of Local’s outstanding stock from has demonstrated its ability to operate a conserva­ funds already allocated by Applicant for this pur­ tively run and profitable institution in a highly pose and derived from its sale in March 1974 of competitive industry. The acquisition will not, $ 125 million in capital notes. Local, an established therefore, constitute a drain upon Applicant’s and consistently profitable business,11 had, as of managerial resources and will provide Applicant June 30, 1975, total consolidated assets of $93 with a competent and experienced management million, including $82.4 million in net receivables, upon which to base its growth plans for Local. total equity capital of $28.6 million, and an al­ In view of the foregoing and other facts of lowance for loan losses of $5.9 million. Local is record, the Board concludes that the overall finan­ a well capitalized institution, with a debt to equity cial aspects of the proposal are not adverse and ratio (exclusive of loan loss reserves) of 2.3:1, that consummation of the proposal, as the Admin­ which is significantly lower than the industry istrative Law Judge correctly found, will not in­ average or the average for consumer loan firms volve unsound banking practices. The Board is of comparable size. In these circumstances, Ap­ also of the view, from its examination of the plicant’s acquisition of Local and its plans to evidence of record, that consummation of the expand Local’s lending operations by approxi­ proposal will not result in an undue concentration mately 100 per cent over a five-year period, while of resources, conflicts of interest or any other maintaining a debt to equity ratio no higher than adverse effects on the public interest. the consumer loan industry average, would not, As the Administrative Law Judge correctly in the Board’s opinion, significantly affect Appli­ points out, in order for the Board to approve an cant’s capital position.12 acquisition under §4(c)(8) of the Bank Holding Moreover, according to Applicant, the proposed Company Act, it must determine that approval can acquisition does not involve a high business risk “reasonably be expected to produce benefits to the and is a prudent way for it to enter the consumer public such as greater convenience, increased finance industry because of the small premium competition, or gains in efficiency that outweigh involved in the proposed acquisition, the high possible adverse effects, such as undue concentra­ quality of Local’s receivables resulting from its tion of resources, decreased or unfair competition, conservative loan policies, Local’s more than ade­ conflicts of interests or unsound banking prac­ quate loan loss reserve, and the ability and experi­ tices.” Thus, the basic balancing test of §4(c)(8) ence of Local’s management. Applicant’s assess­ requires a showing of positive public benefits that ment of the quality of Local’s receivables and the outweigh any possible adverse effects associated adequacy of its loan loss reserve is fully borne with the proposed acquisition. out by the fact that Local’s loan reserve as a In seeking to meet its burden of demonstrating percentage of its net receivables (4.7 per cent) is that the proposed acquisition will be in the public significantly higher than the industry average (3.9 interest, Applicant asserts that consummation of per cent) or the average for consumer finance the proposal would result over a five-year period companies of Local’s size (3.4 per cent), while in a 100 per cent expansion in Local’s consumer lending activities with a corresponding increase in competition and greater convenience to the public. 11 As discussed hereinafter, Local’s profits have, however, Applicant contends that these results can be been declining in recent years. achieved through geographic expansion and a sig­ 12 Applicant acknowledges that its growth plans for Local nificant broadening of the types of services Local will be tempered and coordinated with the needs and require­ ments of its other subsidiaries, particularly Bank. offers the public. Applicant proposes to market Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 707 more aggressively the small direct loans currently testant argues that Local presently is offering or being made by Local and, at the same time, to could offer the additional services proposed by expand the volume of larger size and longer matu­ Applicant, and that, in any event, the benefits rity direct loans in Local’s portfolio by offering proposed to flow from the acquisition will inure a wide variety of new consumer loans and services to the benefit of Applicant and Local rather than such as loan consolidation programs, second to the public. mortgage loans, mobile home loans, recreational The Board has carefully reviewed the evidence vehicle and boat loans, insurance premium fin­ offered by Applicant to support its claimed public ancing, and home modernization loans. Applicant benefits, including the testimony of Mr. Barnes, also proposes to open de novo some 50 to 57 Applicant’s vice president in charge of corporate consumer loan offices within the next five years, planning, that the application before the Board within the States where Local presently operates. fully represents Applicant’s plan for Local, the A majority of these new offices will be in markets testimony of Mr. Kalchik, Local’s president, that not presently served by Local. he anticipates substantial growth in Local’s opera­ Additionally, Applicant contends that consum­ tions upon its affiliation with Applicant, and the mation of the proposal will provide Local with application itself, the execution and delivery of ready access to funds at generally lower rates and which were authorized by Applicant’s Board of with greater assurance of availability, primarily Directors. On the basis of its examination of the through Applicant’s access to the commercial record and in agreement with the Administrative paper market. Local currently does not utilize Law Judge’s findings on this point, the Board commercial paper markets, but relies for short­ concludes that the evidence of record reflects a term financing primarily on bank loans, which is firm policy commitment by Applicant to Local’s generally slightly more expensive than commercial growth to be achieved through more aggressive paper operations. Finally, Applicant contends that marketing of the services Local presently offers, consummation of the proposal will avoid a signif­ introduction of new consumer loan services, and icant reduction in the number of Local’s offices de novo expansion into new geographic markets. and the amount of its outstanding receivables. This Such growth in Local’s operations can reasonably contraction in operations has been planned by be expected to result in increased competition in Local’s management as a method both to improve the consumer finance industry and benefits to the Local’s declining profitability and, following the public, including increased convenience and im­ death of Mr. Fred B. Snite, Local’s founder and proved services. Moreover, the Board is of the controlling stockholder,13 to provide his estate view that this proposed expansion in Local’s ser­ [through redemption of Mr. Snite’s Lopal stock] vices to the public is not likely to occur absent with the necessary liquidity to meet an estate and approval of this application. inheritance tax liability. Local’s management is presently dominated by In his Exceptions to the Recommended Deci­ the highly conservative and nonexpansionary poli­ sion, Protestant asserts that the proposed public cies of Mr. Snite. According to Mr. Kalchik, benefits were “fraudulent and designed to induce Local’s president, these policies, which have pre­ approval of the application.”14 In addition, Pro­ vented Local from expanding geographically and into new service lines, have placed Local at a competitive disadvantage within the consumer fi­ 13Mr. Snite, presently 91 years of age, owns individually 28.6 per cent of Local’s outstanding capital stock and, through nance industry, as evidenced by a decline in its his private foundation, members of his immediate family and profits and efficiency and inadequate service to its related trusts, control an additional 70 per cent. markets. Again according to Mr. Kalchik, this 14Protestant’s assertion is based primarily upon the contrasts between Applicant’s plans for Local as set forth in its applica­ situation is not likely to improve, absent Local’s tion to the Board and certain assumptions underlying financial projections found in a position paper presented to Applicant’s Board of Directors at the time Applicant’s Board approved Local’s acquisition. The projections in the position assumed an expansion of Local’s receivables by 100 per cent without vance of the application solely to assist Applicant’s Board in the establishment of new offices or services, a significant assessing the merits of the acquisition. In the Board’s view, reduction in Local’s cash and loan loss reserve, and an imme­ the Administrative Law Judge properly determined that the diate dividend payment to Applicant of Local’s excess capital, discrepancies between the position paper’s assumptions and with a concomitant increase in Local’s debt to equity ratio Applicant’s formal proposal as reflected in its application to to 8:1. The postion paper, however, does not purport to the Board are logically explained as evolutionary stages in represent Applicant’s plan for Local. It was prepared in ad- Applicant’s plan for Local. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

708 Federal Reserve Bulletin □ August 1976 sale to Applicant in light of Mr. Snite’s attitude Judge found, should strengthen Local’s competi­ and since the other members of Mr. Snite’s family, tive position within the consumer finance industry. who are not active in the company’s manage­ Consummation of the proposal would also avoid ment,15 are interested in security and earnings the significant contraction in Local’s operations rather than in the development and growth of planned by Local’s management as a method to Local. The Board’s review of the record indicates improve Local’s declining profit performance that Mr. Kalchik’s view as to Local’s present through elimination of some 26 of Local’s less position within the consumer finance industry is profitable offices and tightening of Local’s credit correct, that Local is essentially a defensive, non- standards to reduce loan losses. The plan formu­ aggressive competitor. This is demonstrated by lated as an alternative to affiliation with Applicant Local’s highly conservative loan policies, its lower contemplates the reduction of Local’s staff by 140 than average growth rate, its less than average net and its net receivables by approximately $20 mil­ income per office, and principally by the fact that lion and is expected to result in an increase in Local has not expanded into new product lines its profits from $446,000 to $714,000. The pro­ within the past few years or entered a new State posed contraction in operations would also enable since 1945, a new market area since 1953, or Local after Mr. Snite’s death to redeem Mr. opened a new office (as opposed to a spin-off of Snite’s stock while maintaining Local’s tradition­ accounts from an existing office) since 1959. ally low debt to equity ratio. In these circumstances, the Board concludes that Protestant contends that such a contraction in substitution of Applicant, which is committed to Local’s operations will not occur and that Local’s a policy of revitalization and growth in the vol­ loan agreements prohibit such a course of action. ume, scope and character of Local’s services to While Local’s loan agreements prohibit a reduc­ the public and which has the financial resources tion in Local’s liquid net worth below a certain to adequately support that growth, for Local’s amount, they do not prohibit the planned closing present owners represents a public benefit sufficient of its less profitable offices or a reduction in its in and of itself to outweigh the slightly adverse receivables. Moreover, since at least 1966, Local’s effects associated with the proposal.16 agreements with its lenders have contemplated and Furthermore, affiliation with Applicant would expressly permitted a significant redemption of provide Local with access to a broad range of Local’s stock after the death of Mr. Snite for the financial services, including the commercial paper purpose of making available to Mr. Snite’s estate market. While industry statistics indicate that funds for the payment of his estate and inheritance commercial paper represents approximately 18.8 taxes. Local’s recent loan agreements limit the per cent of the total liabilities, capital and surplus amount of such a redemption to $8 million.17 of consumer loan companies, Local has been The Board is satisfied from its review of the principally dependent upon bank loans for short­ evidence of record, including the testimony of Mr. term financing. Applicant’s plan to rely exten­ Kalchik concerning Local’s need to consolidate its sively on commercial paper for Local’s short-term operations to improve its efficiency and its earn­ financing should result in the long run in less costly ings, with the correctness of the Administrative debt financing as well as an increase in Local’s Law Judge’s finding that the planned contraction loanable funds. Affiliation with Applicant will also of Local’s operations is not a “mere sham”, as provide Local with access to a staff sophisticated Protestant argues. In this regard, the Board notes in planning, marketing, financial analysis and economics which, as the Administrative Law 17Local’s loan agreements do, however, as Protestant points out, require the redemption payment to be made in ten equal and annual instalments in the event Mr. Snite’s estate and 15Except for Local’s vice-chairman who is about to retire. inheritance taxes could under §6166 of the Internal Revenue 16While Local may, as Protestant suggests, presently possess Code of 1954 be paid in such instalments. In the event §6166 the ability to provide new services and enter new market areas, were applicable, the fact that the redemption of Mr. Snite’s the record is clear that it has not in fact done so. Nor is there stock would take place over a ten-year period rather than at any reason to believe that, absent approval of the instant one point in time does not mean, as Protestant argues, that application, Local would alter in any material respect its the planned contraction in Local’s operations is prohibited or nonexpansionary policies. On the contrary, as discussed more would not occur. The Board notes that the planned contraction fully below, Local’s management has formulated a plan to in Local’s operations does not rest solely on Local’s need to significantly contract Local’s operations in the event this appli­ provide liquidity to Mr. Snite’s estate but also upon Local’s cation is denied. need to improve its declining earnings. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 709 that the plan Local’s management has formulated factors the Board is required to consider under to increase Local’s earnings is not at all unrea­ §4(c)(8) of the Bank Holding Company Act is sonable in view of Local’s rejection of growth and favorable. Accordingly, the application is hereby expansion and its lower than average ratios of net approved. This determination is subject to the income per office and receivables per employee. conditions set forth in §225.4(c) of Regulation Y Since the proposed contraction in Local’s opera­ and to the Board’s authority to require such modi­ tions would result in a decrease in Local’s services fication or termination of the activities of a holding to the public as well as a decrease in the amount company or any of its subsidiaries as the Board of competition within the consumer finance in­ finds necessary to assure compliance with the dustry, the prevention of that contraction through provisions and purposes of the Act and the Board’s consummation of Applicant’s proposal represents regulations and orders issued thereunder, or to a further benefit to the public. prevent evasion thereof. During the course of the hearing in this matter The transaction shall be made not later than and in a collateral lawsuit challenging the conduct three months after the effective date of this Order, of these proceedings, Protestant raised a question unless such period is extended for good cause by concerning the environmental impact of Appli­ the Board or by the Federal Reserve Bank of cant’s proposal. In view of the nature and extent Cleveland. of the activities involved in Applicant’s proposal By order of the Board of Governors, effective and the fact that the proposal involves merely a July 19, 1976. transfer of the ownership of Local and its presently Voting for action: Vice Chairman Gardner and Gov­ existing 124 offices, the Board concludes that its ernors Wallich, Coldwell, Jackson, Partee, and Lilly. approval of the instant application would not con­ Absent and not voting: Chairman Burns. stitute a major Federal action significantly affect­ (Signed) J. P. G arbarini, ing the quality of the human environment within [seal] Assistant Secretary of the Board. the meaning of section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. §4332(2)(C)). Thus, the Board has determined that Appendix the requirements of that section are inapplicable to the Board’s action in this case. In his Exceptions to the Administrative Law With respect to Applicant’s plans to establish Judge’s Recommended Decision and by various de novo 50 new Local offices in as yet unspecified motions and petitions to the Board, Protestant has locations over the next five years, the Board notes raised a number of objections to the manner and that its action on this application does not consti­ conduct of the administrative proceedings and has tute approval of the opening of those offices. Under requested the Board to vacate the Recommended the Board’s Regulation Y (12 C.F.R. §§225.4 Decision, remove the Administrative Law Judge (b)(1) and (c)(2)), Applicant must obtain the and remand the application for “proper proceed­ Board’s approval prior to establishing any such ings.” In particular, Protestant asserts that in the individual offices. However, since those offices conduct of the hearing due process was violated will be located in leased premises on already as a result of the refusal of the Administrative Law established commercial sites, where there exists Judge and the Board “to allow [P] rotestant to a probable public need or demand for the services present his case or indeed to present any case in offered by such offices and considering the low rebuttal to [A]pplicant’s case” and by their further volume and essentially non-environmental nature refusal to order the production of certain docu­ of such services, the Board does not believe that ments and witnesses requested by Protestant. In any action it may take on those future applications addition, Protestant contends that due process was would constitute a major Federal action signifi­ further violated by “repeated ex parte contacts on cantly affecting the quality of the human environ­ behalf of [A]pplicant to the Board staff and the ment. examiner, and further violated when the Board, On the basis of all the facts of record, including staff and examiner refused to disclose the extent Applicant’s commitment to and ability to support of these ex parte contacts.” an expansion of Local by means of new and The Board has carefully examined the record improved services to the public, the Board has of these proceedings and finds that they were determined that the balance of the public interest conducted by the Administrative Law Judge fairly, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

710 Federal Reserve Bulletin □ August 1976 properly, and in full compliance with both the eral Estate Tax expert and the only witness Prot­ requirements and spirit of the Administrative Pro­ estant had indicated he would call. The Adminis­ cedure Act and the Board’s Rules of Practice for trative Law Judge denied Protestant’s request and Formal Hearings and that in no respect was Prot­ directed Protestant to continue with his cross-ex­ estant denied a fair hearing. Accordingly and for amination of Dr. Shay, Applicant’s final witness. the reasons set out hereinafter, the Board affirms The Administrative Law Judge did, however, in­ in all respects the Administrative Law Judge’s dicate that the matter of postponements to obtain conduct of the proceedings and denies Protestant’s expert testimony would be taken up at the time requests to vacate the Administrative Law Judge’s Protestant was to proceed with his case. decision, remove the Administrative Law Judge, Protestant then informed the Administrative and remand the application for additional pro­ Law Judge that he intended to leave the hearing ceedings. room to prepare and file with the Board an appeal Protestant’s contention that he was denied the from the Administrative Law Judge’s ruling and, opportunity to present his case is apparently based thereafter, to return to Illinois for business reasons. on the series of events surrounding the Adminis­ The Administrative Law Judge informed Protes­ trative Law Judge’s rulings on November 7 and tant that he could file his appeal with the Board 11, 1975, denying Protestant a postponement of during the noon recess and advised Protestant that the hearing from November 11, 1975 until De­ the hearing would proceed in his absence. On six cember 8, 1975, and the Administrative Law separate occasions the Administrative Law Judge Judge’s decision on November 11, 1975, to pro­ directed Protestant to proceed with his cross-ex­ ceed with the hearing to its close following Protes­ amination of Dr. Shay. Protestant refused to pro­ tant’s withdrawal from the hearing room after his ceed and withdrew from the hearing room.1 There­ request for a postponement was denied. Those after, the hearing continued with cross-examina­ events occurred generally as follows. tion of Dr. Shay by Board Counsel and the intro­ At the close of the thirteenth day of hearings, duction into evidence by Board Counsel of nu­ on October 10, 1975, Protestant requested and merous documents and exhibits. Applicant and received a postponement of the hearing until Oc­ Board Counsel then rested their cases. tober 21, 1975, because of health and business On November 12, 1975, the Administrative reasons. On October 20, 1975, Protestant notified Law Judge issued to all parties to the hearing a the Administrative Law Judge that because of notice to show cause by the close of business health reasons he would not be able to proceed November 18, 1975, why the hearing should not on October 21, 1975. On the same date, Applicant be closed. At Protestant’s request, the time limit also sought from the Administrative Law Judge to respond to the notice was extended to November a postponement of the hearing. With the consent 21, 1975. On November 24, 1975 the Adminis­ of all parties to the proceeding, except Board trative Law Judge closed the hearing and rejected Counsel, who objected to any further delays, the Administrative Law Judge scheduled the hearing to reconvene on November 11, 1975, and indi­ cated that the hearing would proceed thereafter to its conclusion. 1 Similarly, during the course of the hearing session on However, by letter dated October 31, 1975, October 3, 1975, Protestant withdrew from the hearing room following an adverse ruling from the Administrative Law Protestant requested of the Administrative Law Judge, without the Administrative Law Judge’s permission and Judge a further postponement of the hearing from despite the Administrative Law Judge’s direction to Protestant, repeated four times, to proceed with his cross-examination of November 11, 1975 until December 8, 1975, Applicant’s witness. On that occasion, Protestant filed with because of business reasons and in order that he the Board’s Secretary a “Petition to the Board” for special might “reflect on and assess” his position in the permission to appeal from the ruling of the Administrative Law Judge denying Protestant’s request that hearing sessions not proceedings. By Order dated November 7, 1975, be held on Saturdays. By Order dated October 8, 1975, the the Administrative Law Judge denied Protestant’s Board denied Protestant special permission to appeal and request. The hearing reconvened on November 11, affirmed the authority of the Administrative Law Judge to regulate the course and conduct of the administrative proceed­ 1975, at which time Protestant renewed his request ings. The hearing session scheduled for Saturday, October 4, for a postponement for the reasons stated in his 1975, was cancelled when at the close of the hearing on Friday, October 3, 1975, Protestant indicated that he had become ill letter of October 31, 1975, and, in addition, be­ and planned to consult with a physician on Saturday morning. cause of the unavailability of Mr. Suskin, a Fed­ Thereafter, no further Saturday sessions were scheduled. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 711 as untimely Protestant’s response to the Show ther postponement of the hearing on November Cause Order.2 11, 1975, and thereafter proceeding with the hear­ On November 13 , 1975 Protestant filed with the ing to its close in the self-imposed absence of Board’s Secretary a “Petition to the Board” seek­ Protestant. ing special permission of the Board pursuant to In the Board’s view, the record clearly demon­ § 263.10(e) of its Rules of Practice (12 CFR § strates that the Administrative Law Judge 263.10(e)) to appeal “from the ruling or refusal throughout the course of the lengthy and protracted of the Administrative Law Judge to continue the hearings fairly accommodated Protestant. At the hearings to the week of December 8, 1975.” By hearing session on November 11, 1975, Protestant Order dated November 18, 1975, the Board denied had nearly four weeks in which to “reflect on and Protestant special permission to appeal (40 Federal assess” his position and make necessary prepara­ Register 55720) on the grounds that the Adminis­ tions for the hearing. Applicant’s final witness, trative Law Judge’s decision involved a matter whom Protestant had already cross-examined for committed to his sound discretion by both law and two days, as well as a previous witness, Mr. regulation. Barnes, whom Protestant had asked to be made By undated motion received by the Administra­ available for use as his own witness, were both tive Law Judge on December 16, 1975, Protestant present at the hearing, the former at considerable in addition to requesting the removal of the Ad- expense to Applicant. Rather than proceed in an mistrative Law Judge, requested that the hearing orderly manner with his questioning of these two be reopened to take the testimony of Mr. Suskin witnesses, Protestant chose to withdraw from the and unspecified “others,” which testimony Pro­ hearing room in direct contravention of the Ad­ testant alleged “was muzzled by the current judge ministrative Law Judge’s express and repeated without rhyme or reason. ’ ’ By Order dated January order to proceed with his cross-examination and 7, 1976, the Administrative Law Judge denied with the full and clear knowledge that the hearing Protestant’s motions but permitted him to submit would continue in his absence. In these circum­ the affidavit of Mr. Suskin, the only prospective stances, Protestant’s contention that he was de­ witness named by Protestant in response to the prived of the right to present his case is, in the Show Cause Order. Mr. Suskin’s affidavit was Board’s view, wholly without merit. This is espe­ later accepted into evidence by the Administrative cially so in view of the fact that the Administrative Law Judge. Law Judge later permitted Protestant to file the As the Board has previously indicated in its affidavit of Mr. Suskin. Orders of October 8, and November 18, 1975, Protestant next contends that the administrative denying Protestant special permission to appeal proceedings were defective as a result of the re­ from rulings of the Administrative Law Judge, the fusal of the Administrative Law Judge to order decision to grant or deny a continuance in and the production of certain documents and witnesses. to otherwise regulate the course and conduct of During the course of the hearing, Protestant de­ an administrative hearing are matters committed manded of Applicant the production of a large to the sound discretion of the Administrative Law number of documents, including the desk calendar Judge under both the Board’s Rules of Practice of Mr. Barnes, Applicant’s complete corre­ and the Administrative Procedure Act. In addition, spondence file on the proposed acquisition, Local’s the Board’s Rules of Practice impose upon the profit and operating plans, Applicant’s formal Administrative Law Judge the duty and respon­ analyses of the proposed acquisition of Local and sibility to take all necessary action to avoid delay the feasibility of de novo entry into the consumer in the disposition of the proceedings. Considering finance industry, Local’s long- and short-term loan all of the relevant circumstances the Board is agreements, documents and memoranda presented unable to conclude that the Administrative Law to Applicant’s Board of Directors concerning the Judge abused his discretion or acted without regard proposed acquisition as well as related Board to the convenience and necessity of the parties in minutes, the wills, trust agreements and estate denying Protestant’s additional request for a fur­ plans of Mr. Fred B. Snite, and current financial information for Bank and Local (as of January 30, 1976). Protestant further demanded the production 2The Board has reviewed Protestant’s response to the Show of some 19 witnesses, including many of Appli­ Cause Order and finds that it principally restates Protestant’s earlier arguments for a continuance. cant’s directors and executive officers, virtually Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

712 Federal Reserve Bulletin □ August 1976 every individual who was identified during the regard, the Board notes that both Mr. Barnes and course of the hearing as having any connection Mr. Kalchik were fully available for examination whatsoever with the application, Local’s three by Protestant and that both did, in fact, testify senior officers as well as Dr. Willis J. Winn, the at length concerning many of these matters. President of the Federal Reserve Bank of Cleve­ With respect to the wills and estate plans of land. Mr. Snite, Protestant contends that these docu­ The Administrative Law Judge declined to order ments were necessary in order to accurately calcu­ the production of the witnesses and documents late the Federal Estate Tax liability on Mr. Snite’s requested by Protestant, concluding that the estate. The Administrative Law Judge noted that Board, and therefore any Administrative Law while no evidence had been produced on the full Judge appointed pursuant to its Rules of Practice, extent of Mr. Snite’s estate, none was necessary lacked authority to require by subpoena or by order to support his conclusions with respect to the under section 5(b) of the Bank Holding Company anticipated contraction of Local’s operations pro­ Act the attendance of witnesses or the production jected to occur on Mr. Snite’s demise. The Board of documents in an administrative hearing held fully agrees with the Administrative Law Judge’s under the provisions of the Act. While the Board analysis and conclusion on this aspect of Protes­ fully agrees with the Administrative Law Judge’s tant’s request. conclusion that the Board lacks subpoena power In addition to the documentary materials made under the Act, the Board in the circumstances of available to Protestant, Applicant also produced this case need not and does not determine the two of the witnesses Protestant requested. With extent of its authority to order the production of respect to the remaining witnesses demanded by documents and witnesses under section 5 of the Protestant, the Board concludes from its examina­ Act, since, in the Board’s view, the issuance of tion of Protestant’s demands therefor that Protes­ an order such as requested by Protestant would tant either failed to establish the need materiality for the reasons stated hereinafter be neither appro­ and relevance of the testimony sought to be elicited priate nor warranted. or that such testimony would be unduly repetitious In response to Protestant’s far-ranging requests of testimony and evidence actually produced by for the production of documents, Applicant, at Applicant. With respect to Dr. Winn, the Board Board Counsels’ request, voluntarily and in a more has considered his affidavit to the effect that he than reasonable effort to accommodate Protestant has never analyzed or seen an analysis of the produced the great bulk of the documentary mate­ subject application or made any recommendation rials demanded, including Applicant’s analyses of with respect thereto. His conversations with offi­ and position papers on the proposed acquisition, cials of Applicant in late 1974 were confined to minutes of its Board of Directors, its feasibility the capital position of Bank, and his knowledge studies on de novo entry into the consumer finance of the same was derived from the report of exami­ business, and Local’s loan agreements. With re­ nation of Bank prepared by the Office of the spect to those items not produced, Protestant’s Comptroller of the Currency. In these circum­ requests were not supported by any statement as stances and in view of the Comptroller’s refusal to the scope or general relevance of the materials to permit the Report of Examination of Bank to sought. Moreover, the Board’s review of Protes­ be introduced or used in the proceedings and the tant’s few unsatisfied demands indicates that those inability of Dr. Winn to testify concerning matters demands, including, for example, Local’s profit contained in that report absent permission from and operating plans, Applicant’s complete corre­ the Office of the Comptroller of the Currency,4 spondence file on the proposed acquisition, and the Board does not consider any testimony Dr. Mr. Barnes’ office calendar, were either only re­ Winn could give as relevant or necessary to this motely relevant and material to the issues in the proceeding. hearing, unreasonable and excessive in scope, or cumulative of evidence already in the record or otherwise available to Protestant.3 In the latter Law Judge. Applicant had, however, during the course of the hearing, submitted such information for the first half of 1975, 3Protestant’s request for the year-end 1975 financial infor­ the most recent data then available. Under these circumstances, mation for Local and Applicant was filed after the close of the Board deems Protestant’s request to be wholly improper the hearing, indeed after Applicant had submitted its Proposed and unreasonable. Findings of Fact and Conclusions of Law to the Administrative 4See 12 CFR § 4.18(b). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 713 In connection with its review of Protestant’s sought the Administrative Law Judge’s removal demands for the production of documents and because of the pendency of a lawsuit filed against witnesses, the Board has also considered the fact the Administrative Law Judge by Protestant on that the Administrative Law Judge, while recog­ December 12, 1975, in the United States District nizing the ability of the Board to draw adverse Court for the Northern District of Illinois (Civil inferences from an applicant’s refusal to produce Action No. 75 C 4238).6 In that lawsuit Protestant “substantial relevant and material evidence,” de­ challenged the Administrative Law Judge’s rulings clined to draw any such inference in this case. on Protestant’s requests for discovery and contin­ The Board concludes from this that the Adminis­ uances, as well as his impartiality and qualifi­ trative Law Judge did not deem Protestant’s unsat­ cations to sit in a banking case. On January 7, isfied demands to be sufficiently material or rele­ 1976, the Administrative Law Judge denied Pro­ vant to warrant such action. testant’s motion because of the absence of good In view of the foregoing and all other relevant cause shown.7 circumstances, the Board concludes that the Ad­ Protestant’s December 16, 1975 motion sets ministrative Law Judge’s action in declining to forth no legal or factual basis constituting suffi­ order the production of those documents and wit­ cient ground or cause for the removal of the nesses requested by Protestant and not voluntarily Administrative Law Judge. Moreover, the Board’s produced by Applicant was completely proper and examination of the record, including the proce­ justified and further that Protestant was not thereby dural rulings to which Protestant’s lawsuit was denied a fair hearing. directed, indicates that the Administrative Law With respect to Protestant’s allegation of ex Judge’s actions were at all times proper, consistent parte contacts between the Administrative Law with good practice, and, in fact, demonstrated Judge and counsel for Applicant, the Board notes remarkable patience and restraint on his part in that Protestant in failing to file a timely and suffi­ dealing fairly with Protestant. The Board believes cient, or indeed any affidavit of personal bias or Protestant’s charges to be utterly baseless and his other disqualification in connection with his asser­ motion was properly denied. tions did not comply with § 263.6(a) of the Protestant’s unsigned and undated motion re­ Board’s Rules of Practice and the Administrative ceived by the Administrative Law Judge on Feb­ Procedure Act, 5 U.S.C. § 556(b). In addition, ruary 10, 1976 sought the Administrative Law even assuming the alleged communication be­ Judge’s removal because of the Board’s alleged tween the Administrative Law Judge, and Appli­ failure to comply with 5 U.S.C. § 3105, the cant’s counsel took place, which communication section of the Administrative Procedure Act deal­ Applicant’s counsel denies, such a communi­ ing with the appointment of Administrative Law cation, involving merely a statement by the Ad­ Judges. In his Recommended Decision, the Ad­ ministrative Law Judge that he expects to render ministrative Law Judge denied Protestant’s mo­ his decision within the 45-day period provided tion. The Board is also of the view that Protestant’s under the Board’s Rules of Practice is not viewed by the Board as improper and does not concern “any fact in issue” within the meaning of § 263.6(a) of the Board’s Rules of Practice and the 6This lawsuit was subsequently dismissed. Administrative Procedure Act, 5 U.S.C. § 7By unsigned motion dated January 30, 1976, Protestant petitioned the Board pursuant to 12 CFR § 263.10(e) for special 554(d).5 permission to appeal the Administrative Law Judge’s Order In its consideration of Protestant’s Exceptions, of January 7, 1976. In that petition, Protestant also requested the removal of the Administrative Law Judge because of the Board has also reviewed Protestant’s motions alleged ex parte contacts between the Administrative Law to remove the Administrative Law Judge filed with Judge and counsel for Applicant. In addition, Protestant re­ the Administrative Law Judge on December 16, quested the Board to direct the Administrative Law Judge to rule on his discovery requests. 1975 and February 10, 1976. The former motion On February 10, 1976, the Board’s Secretary advised Pro­ testant that his motion to remove the Administrative Law Judge did not comply with § 263.6(a) of the Board’s Rules of Practice, and that his petition for an order directing the Ad­ 5The Board’s examination of the record has revealed no basis ministrative Law Judge to rule on unspecified demands for the whatsover to support Protestant’s allegations of ex parte con­ production of documents and witnesses was premature. As tacts between Applicant and Board staff or other alleged noted above, the Administrative Law Judge in his Recom­ misconduct. The Board considers such allegations to be wholly mended Decision subsequently declined to order the production unwarranted. of the documents and witnesses requested by Protestant. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

714 Federal Reserve Bulletin □ August 1976 belated challenge to the appointment of the Ad­ 1168) seeking “[m] andamus relief to see that the ministrative Law Judge is unmeritorious and with­ documents are filed instanter.” In addition, by out validity. The Administrative Law Judge was letter dated June 24, 1976, Protestant requested properly appointed pursuant to 5 U.S.C. § 3105 the Board’s Secretary to include in the record on and was properly selected to conduct the instant this application a copy of that complaint with the hearing pursuant to 5 U.S.C. § 3344 by the objectionable pleadings attached. Protestant’s re­ Director, Office of Administrative Law Judges, quest is hereby denied. United States Civil Service Commission, with the Having carefully reviewed the evidence of consent of the Administrative Law Judge’s em­ record in this matter, including the Administrative ploying agency, the Department of Housing and Law Judge’s findings and conclusions, the Board Urban Development. finds that all other motions, demands, and excep­ On March 26, 1976, Protestant filed with the tions made by Protestant are without merit, and Board a “Motion to Reopen Hearings for taking they are hereby denied. of testimony of Snite and S. P. Mellon.” Protes­ Board of Governors of the Federal Reserve tant asserts that Mr. Snite “is being held incom­ System, July 19, 1976. municado and under quasi sedation in California ... to silence his opposition to sale of Local Loan Recommended Decision Company . . .”. With respect to Mr. Mellon, of the Administrative Law Judge Protestant desires to inquire “relative to his state of mind and views of legal procedures applicable Statement of the Case to a civilized society.” Protestant’s motion being On October 11, 1974 (by documents dated Sep­ wholly unsupported by affidavits or any relevant tember 30, 1974),1 Mellon National Corporation, evidence is hereby denied. the Applicant herein, submitted to the Federal On March 26, 1976, Protestant also filed with Reserve Bank of Cleveland an application for prior the Board a motion to dismiss the application as approval to acquire all outstanding shares of Local moot, contending that the Stock Purchase Agree­ Loan Co., Local herein, pursuant to Section ment between Local and Applicant expired on 4(c)(8) of the Bank Holding Company Act of March 31, 1976. On March 31, 1976, Applicant 1956, as amended, herein the Act, 12 U.S.C. filed with the Board and served upon Protestant Section 1841 et seq., and the Rules and Regula­ a copy of a letter agreement extending the closing tions of the Board of Governors of the Federal date under the Stock Purchase Agreement from Reserve System, the Board herein, Regulation Y, March 31, 1976 to August 31, 1976. Accordingly, 12 C.F.R. Section 225 et seq. Additional materi­ Protestant’s motion is hereby denied. als, clarifications, and corrections were requested In his Exceptions to the Recommended Deci­ and thereafter received on October 24, November sion, Protestant requested oral argument before the 6, November 7, and November 13, 1974. On Board as provided for in § 263.14 of the Board’s November 19, 1974 (by letter of November 13, Rules of Practice (12 CFR § 263.14). Protestant’s 1974), the Application was received by the Board request, made in a summary fashion, does not from the Federal Reserve Bank of Cleveland. The show that any purpose would be served by allow­ receipt by the Board constitutes the filing within ing oral argument. Protestant’s request is hereby the meaning of the Act. denied. On November 27, 1974, a copy of the applica­ By motions dated May 26, 1976, Protestant tion was submitted to Anti-Trust Division, requested the Board to strike Board Counsel’s Department of Justice with concurrent notification Response to Protestant’s Exceptions and to reopen to the Comptroller of the Currency of the Depart­ the proceedings. For the reasons stated in its letter ment of the Treasury and the Federal Deposit of June 8, 1976, to Protestant the Board returned Insurance Corporation. None of these agencies those pleadings to Protestant without considering thereafter intervened or opposed the acquisition. their substance and with leave to Protestant to On November 29, 1974, the Applicant was re­ resubmit the same in acceptable form. Protestant quested by the Board to supplement its Application has not, however, seen fit to do so. Rather, on June 24, 1976, Protestant filed a lawsuit against the Board in the United States District Court for Except where noted the documents are of the same date the District of Columbia (Civil Action No. 76- as the action indicated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 715 with additional information. On December 23, II,9 1975. On November 4 (by an undated docu­ 1974 (by letter dated December 13, 1974), the ment), Protestant filed a Motion to Remove Coun­ requested supplemental information was filed with sel for Applicant. On November 10 and November the Board. On December 6, 1974 (by Order dated 11 (by documents dated November 10), Applicant November 27, 1974), the Board published the and the Board, respectively, opposed the Motion. Notice of Application which provided, inter alia, On November 10 by telegram, the undersigned that expressions of views and requests for hearings denied Protestant’s Motion to Remove Counsel. should be filed with the Board in writing no later Following the November 11 adjournment, a than December 30, 1974. (39 Federal Register telegraphic Notice to Show Cause was issued on 42719). November 12 requiring the parties to show cause On January 9, 19752 (by letter dated January by the close of business November 18, why the 6), Anthony Robert Martin-Trigona, Protestant hearing should not be closed. On November 18 herein, “ Renew [ed] [his] demand for a hearing (by telegram of the same date), Protestant re­ on this application” and adopted by reference his quested a further extension. On November 19 by filing of September 5, 1974 (by letter dated August telegram, the time for response to the Notice to 29, 1974), titled “Notice of Opposition to Pro­ posed Acquisition” in which the present Applica­ tion was opposed. On January 27 (by letter dated January 24, 1975), Applicant contested Protes­ 8 At the close of the hearing on October 10, it was originally tant’s standing to intervene. Following a lengthy intended that the hearing should resume on October 11 and exchange of correspondence between the parties thereafter on October 14. At the request of Protestant for health and business reasons, the hearing was scheduled to resume and the Board, on May 30, 1975, an informal on October 21. The setting was agreeable to all parties. On preliminary hearing on the standing of Anthony October 20, a telephone call was received from Jerome W. Robert Martin-Trigona as a Protestant in the matter Shay, Counsel for Applicant, who reported that Applicant intended to request a postponement to further consider the was scheduled for June 12, 1975 in Washington, situation, and that Applicant had been unable to reach Protes­ D.C. The hearing was held as scheduled before tant to obtain his position. Mr. Shay was informed that where the date was an agreed setting, the postponement would be John D. Hawke, Jr., General Counsel of the looked upon with disfavor unless agreed to by the other parties. Board. The Applicant appeared by Counsel and The undersigned suggested that he contact Mr. Banzhaf, who the Protestant appeared in person and by Counsel. possibly would know how to reach Mr. Martin-Trigona, and Mr. Brown. Shortly thereafter, a telephone call was received On July 28, 1975, the Board3 by formal Order from Mr. Banzhaf. He reported that Mr. Martin-Trigona was decided to refer the Application to formal hearing4 then under a doctor’s care and in bed and would not be before Administrative Law Judge Phillip J. La available for the hearing the following day. He further stated that he had no indication when Mr. Martin-Trigona would be Macchia. On August 22, 1975, the*Board desig­ available to proceed with the case, but that he would definitely nated the undersigned to conduct the hearing and not be there on October 21. Mr. Banzhaf was then informed of Mr. Shay’s call and that Mr. Shay would probably be calling directed the hearing for September 3, 1975. The him shortly. A conference call was suggested and arranged. hearing was held on September 3, 4, 5, 6,5 29, Mr. Shay (for Applicant), Mr. Banzhaf and Mr. Martin- 30, October 1, 2, 3,6,7 6, 7, 9, 10,8 and November Trigona (for Protestant), Mr. Brown (for the Board), and the undersigned participated. After discussion, the postponement was requested and agreed to by all parties except the Board; the date, November 11, was suggested by Mr. Shay and agreed to by Mr. Martin-Trigona. The parties were informed that it should be planned that the hearing would proceed on consecu­ 2Except where noted, all dates refer to 1975. tive days to its conclusion subject only to availability of 3Governors Holland and Coldwell dissenting. witnesses. 4The Board determined not to decide the question of An­ Thereafter, on November 3 (by letter dated October 31), thony Robert Martin-Trigona’s standing as a potential compet­ Protestant requested a further postponement of the hearing until itor in this case but to permit Mr. Martin-Trigona to participate December 8. On November 4, Applicant opposed such further in the hearing. postponement. On November 7, the request was denied. Pro­ 5The hearing was held Saturday without objection. testant appealed this ruling to the Board and simultaneously 6During the course of the hearing, Protestant took exception gave notice of appeal to the United States Court of Appeals to the ruling on prospective Saturday sessions, and Protestant for the District of Columbia of the possible adverse ruling. later absented himself from the hearing room to file his appeal The appeal to the Board was denied November 18. with the Board. On October 8, the Board affirmed the authority 9The hearing was opened on this day with Mr. Martinof the Administrative Law Judge. Protestant gave notice of Trigona’s demand that the hearing be adjourned until December appeal on the issue to the United States Court of Appeals for 8. Upon being denied the adjournment, Mr. Martin-Trigona the District of Columbia Circuit. As it developed, there were left the hearing room. The hearing continued in his absence, coincidentally no further Saturday sessions. and before the hearing adjourned both Applicant and the Board 7 Originally it had been intended to continue the hearing rested their cases. The Applicant further moved that the hearing Saturday, October 4; however, the Saturday session was can­ be closed at that time. Although the Board did not object to celled at the request of Protestant for pressing personal health Applicant’s motion, Counsel for the Board suggested that reasons. Protestant be given an opportunity to present its direct case. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

716 Federal Reserve Bulletin □ August 1976 Show Cause was extended to the close of business receipt of notice of the filing of transcript of November 21. The hearing was closed on No­ testimony. On February 2, 1976 (by documents vember 24 and the date for filing briefs was set dated January 30, 1976), Protestant filed: (1) a for December 29. On November 24 (by letter dated demand for an Order to Produce certain current November 20 but mailed November 21), Protes­ financial statements; (2) a Motion to Extend Time tant responded to the November 11 Notice to Show for Filing Brief until February 10, 1976; and (3) Cause. His response was rejected as untimely and the affidavit of Edward Kenneth Suskin. On the not given consideration.10 On December 1 (by same date, Protestant Petitioned the Board to Re­ letter dated November 26), Mr. Banzhaf for Pro­ move the Administrative Law Judge. On February testant objected to the use of telegraphic notices 4, 1976 by telegram, the time for filing briefs was in the proceedings.11 On December 12, Protestant extended to the close of business February 9, requested service on him of certain documents 1976. By Order dated February 9, 1976, the de­ introduced by Applicant and the Board on No­ mand for an order requiring production of docu­ vember 11 after he had left the hearing room.12 ments was denied.14 Also on February 9, 1976 On December 16, (by undated document), Protestant filed a Motion to Remove the Adminis­ trative Law Judge and to Reopen the Hearing. The Motion was opposed by the Applicant and the 14 The issue of compulsory production of documents came Board. Applicant timely filed its Proposed Find­ up repeatedly in the hearing. The Board’s position as reflected ings of Fact, Conclusions of Law, and Supporting by Mr. Loeser’s statement of September 3 and 5, Mr. Oeh- Brief on December 29. On December 30 (by mann’s statement of September 30, and Exhibit 87 was that the Board was not granted subpoena authority under the Bank document dated December 26), Protestant re­ Holding Company Act unlike other comparable laws. The issue quested a further extension of time for filing briefs. was considered and specifically rejected by Congress as fol­ The request was opposed by Applicant. By Order lows: MR. MORSE: Mr. President, the purpose of the amendment dated January 7, 1976, the Motion to Remove is to grant subpoena power to the Board. Administrative Law Judge was denied, the Motion A major defect of the bill is its failure to give the Federal Reserve Board any power to compel the production of docu­ to Reopen the Hearing was denied,13 and the ments or the appearance of witnesses. The Board has no such Motion to Extend Time For Filing Briefs was power at the present time. The general statutes creating the granted until the close of business January 16, Federal Reserve Board and giving it powers in other fields such as enforcement of the Clayton Act do not, as is the case 1976. The Board joined Protestant’s Motion to with other administrative agencies, grant to the Board general Extend Time For Filing Briefs because of the powers to subpoena witnesses, compel the production of docu­ undersigned’s failure to properly file the transcript ments, and so forth. Accordingly, anyone requested by the Board or a bank holding company to appear who does not of testimony with the Secretary of the Board. The desire to produce documents or to give testimony at a hearing transcript of testimony was properly filed with the held by the Board under this bill need not do so. No genuine hearing could be held without this power, which Secretary on January 14, 1976, whereupon, the is given by law to almost every other Federal agency exercising time for filing briefs was set for 15 days after regulatory functions comparable to those assigned to the Board by this bill. Unless documents can be required to be produced and witnesses compelled to attend hearings, the hearings may well be abortive. The amendment proposed is designed to give the Board this necessary power in connection with hearings held under the 10The document is in the exhibit file. Act. The provisions are modeled upon corresponding provi­ 11 The use of telegraphic notices was deemed appropriate sions of the Federal Power Act (16 U.S.C. 825(b)-(c)). because of the extraordinary situation. I submit the amendment. 102 Con. Rec. (Senate) 6959. The 12The documents were subsequently served on Protestant. Amendment was rejected. 13The Notice to Show Cause issued November 12 required Protestant argued that despite this rejection, the Board could any responding party to name any prospective witnesses and compel production of evidence. His position was stated as to briefly summarize their testimony. Protestant had responded follows: in its untimely letter filed on November 24 by naming only MR. BANZHAF: May I attempt to correct counsel on that. Edward Kenneth Suskin. Of his testimony, Protestant stated, I believe the statute provides that the Board may issue any “I cannot summarize Mr. Suskin’s testimony because I do order which is necessary to carry out its functions. If I can not control his testimony. I have an idea of questions I will find it, I will refer counsel to it. be putting to him, but I do not control his answers so I cannot MR. LOESER: I think counsel’s referring to Section 5B of speak for him.” the — Despite Protestant’s prior failure to comply with the Notice MR. BANZHAF: Committee—Section 5B, the Board is au­ to Show Cause, the Order denying the Motion to Reopen the thorized to issue such regulations and orders as may be neces­ Record provided that Protestant could “submit appended to sary to enable it to administer and carry out the purposes of his brief a copy of the affidavit of Edward Kenneth Suskin this Act, and prevent evasions thereof. It certainly seems to bearing on the material issues of this proceeding, which after me a reasonable order to be that if you feel the attendance consideration may be received in evidence and considered as of witness and the production of documents would be necessary the testimony of the affiant as if he had been called.” to carry out your functions, to make a complete and detailed Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 111 (by document dated February 6), Protestant moved bank holding company which controls Mellon for the admission of the affidavit of Edward Ken­ Bank, N.A., the Bank herein. In addition to the neth Suskin. On February 14, 1976, Applicant commercial banking activities of the Bank, the opposed the admission of the affidavit of Edward Applicant is principally engaged in mortgage Kenneth Suskin.15 banking, real estate and leasing, through various On February 10, 1976 (by document mailed other subsidiaries and affiliates. Applicant does not February 9, 1976) Protestant filed his Proposed presently have a consumer finance subsidiary. Ap­ Findings of Fact, Conclusions of Law, and Sup­ plicant’s total consolidated assets are $9.9 bil­ porting Brief.16 On February 10, 1976, Applicant lion.21’22 moved to strike “Protestant’s Reply Memoran­ The Bank is the largest bank in Pennsylvania dum.”17 On the same date, Protestant filed a with its principal office and place of business Motion to Remove the Administrative Law Judge. located in Pittsburgh. The 102 branches of the The Motion to Remove was opposed by the Bank are located in the six-county metropolitan Board.18 On February 13, 1976, Applicant sub­ area of Pittsburgh. Based upon domestic deposits mitted an affidavit of Lawrence X. Pusateri.19 On it is the sixteenth largest commercial bank in the February 19, 1976, Applicant filed its Answering United States. The Bank’s deposits of $5.3 billion Brief.20 No brief was filed by the Board. represent 12.4% of domestic deposits in the State. Accordingly, I make the following: Ninety-nine per cent ($9.5 billion) of the Appli­ cant’s consolidated assets are represented by the Findings of Fact assets of the Bank. During the five years ending December 31, Mellon National Corporation, the Applicant, is 1974, Applicant has increased consolidated assets a Pennsylvania corporation with principal offices by 90% ($9.7 billion from $5 billion), consoli­ at Pittsburgh, Pennsylvania. Applicant is a one- dated net income by 26% ($57.7 million from $45.8 million), domestic and foreign deposits by 71% ($7.2 billion from $4.2 billion), and total equity capital by 21% ($569 million from $470 million). The increase has been accomplished by examination of an application, that you could issue exactly growth as well as acquisitions and de novo opera­ such an order. tions. During 1973, Applicant through its subsidi­ It is concluded that the general grant of authority in Section 5(b) of the Act, “. . . to issue such regulations and orders ary Mellon National Mortgage Company acquired as may be necessary to enable it to administer and carry out Carruth Mortgage Company (New Orleans, Loui­ the purposes of this Act and prevent evasion thereof,” is siana). Early in 1973 Applicant, through its sub­ insufficient to negate the specific rejection by Congress of the power of compulsory production of evidence. Accordingly, the sidiary Mellon National Mortgage Company, Board could not compel a party to produce evidence in a began de novo operations of Mellon National Regulation Y proceeding. Since the Board did not have the power, it could not be vested in the Administrative Law Judge Leasing Corporation (Pittsburgh) which is engaged designated by the Board. This does not necessarily mean the in full pay-out leasing of equipment. In 1974 Board has no recourse where substantial relevant and material Applicant, also through its subsidiary Mellon Na­ evidence is not produced on demand of the Board. The Board could infer that the evidence would not support the Party tional Mortgage Company, acquired 25% interest refusing its production, or in the alternative could allow ad­ in Banco Bozano Simonsen de Investimento, mission of secondary evidence to establish contested facts. S.A., an investment bank in Brazil. Finally, where the Board deemed the failure to produce evi­ dence to be sufficiently substantial, it obviously would find The most significant operations of the Applicant against the Applicant or Protestant because of failure to support are conducted through the Bank, which contributes the application or protest, respectively. However, parties would not by this have an open reason to demand production of substantially all of the income of Applicant. As evidence by opponents since the appropriateness of such de­ noted above, the Bank is a commercial bank. The mands would be limited not only by relevance and materiality, but also by reasonable limitations of cumulativeness and re­ moteness . 15 The affidavit of Edward Kenneth Suskin is received in evidence and made a part of the record in the case. 16 The perfunctory request for oral argument appearing on the cover sheet of the submission is denied. 17Protestant’s Proposed Findings of Fact, Conclusions of Law and Supporting Brief is received. 21 Except where noted, all financial information is as of 18The Motion to Remove is denied. December 31, 1974. 19 The affidavit of Lawrence X. Pusateri is rejected as not 22Applicant’s Asset x Equity ratio over the last five-year bearing on the issues of the case. period has been well below the average for the peer group 20The Answering Brief is rejected? of bank holding companies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

718 Federal Reserve Bulletin □ August 1976 most significant thrust of Bank activities is in the areas. These are as follows: major heavy industrial area, both domestic and international.23 Additionally, it provides the usual Location Offices retail bank services to customers. This includes California both a credit card program (affiliated with Master Southern Los Angeles and Charge card system) and consumer lending serv­ Northern Orange Counties ices. The volume of consumer loans of the Bank (Los Angeles area) 21 Western San Diego (San Diego area) 8 represent less than 4% ($360 million) of the total San Francisco and Northern San Mateo assets of the Bank.24 Substantially, all of these Counties (San Francisco area) 3 consumer loans originate in the six-county Pitts­ Western Alameda County (Oakland burgh metropolitan area. The only other loan area) 2 amount worthy of note is that produced by the Contra Costa County 1 San Jose area 1 purchase of mobile home sales contracts which are Sacramento and Western not, confined to the six-county area. Placer County (Sacramento area) 6 The Applicant’s mortgage banking operations Colorado are carried on by Mellon National Mortgage Cor­ Boulder and Denver Counties; Western Adams and Western poration (a subsidiary of Applicant) and its sub­ Arapahoe Counties; Northern sidiaries Laurel Mortgage Co. and Carruth Mort­ Jefferson County (Denver area) 6 gage Corporation, by the Allamon Corporation (a Florida subsidiary of Applicant) through its subsidiary Northeast Dade County (Miami area) 3 Mellon National Mortgage Co. of Ohio (Cleve­ Illinois Northwestern Chicago 3 land, Ohio), and by the Bank through its subsidi­ Cities of Waukegan, North Chicago, ary Mellon National Mortgage Company of Colo­ Dundee, and Zion 1 rado (Denver, Colorado). Of these, only Mellon Elgin area 1 National Mortgage Co. of Ohio engages in con­ Western Chicago 3 Southern Suburban Chicago 1 sumer loan activities. The volume of its consumer Aurora 1 loans represents less than .1% the assets of Mellon Chicago proper 11 National Mortgage Co. of Ohio. These consumer Freeport 1 loans are in the Cleveland Area. Peoria 1 Local Loan Co. is a Delaware Corporation with Indiana/Kentucky Louisville area 5 principal offices in Chicago, Illinois.25 Fred B. Minnesota Snite, the founder, continues at the age of 91 to Minneapolis-St. Paul area 4 actively function as Chairman of the Board. Mr. Duluth 1 Snite, members of his family, related trusts, and Nebraska Omaha area 2 Mr. Snite’s private foundation own about 99% of New York the outstanding stock of Local and its subsidiaries. New York City 3 Local through its own operations and those of Oregon its 19 subsidiaries is engaged in the consumer Portland area 6 finance business. These consolidated operations Polk and Western Marion Counties (Salem area) 1 are conducted in 124 offices in 12 States; the Benton and Western Lion Counties offices are located in 38 identifiable market service (Corvallis area) 1 Lane County (Eugene area) 4 Douglas County 1 Jackson County 2 Washington Western King and Western Snohomish Counties (Seattle area) 8 23 The Bank also extends credit to consumer finance compa­ Western Whatcam County 1 nies (both captive and independent). As of June 30, 1974, Southern Douglas and Southern the total credit commitment was $456 million and actual Chilan Counties (Wenatchee area) 1 borrowings were $117 million. Local has not been a customer Spokane County 3 of the Bank. Wisconsin 24It is estimated that there are 180,000 such loans including Kenasha 1 credit card accounts, personal cash reserve accounts, auto Milwaukee 6 loans, home improvement loans, mobile home financing loans, executive-professional loans, and other consumer loans. Brown County 25 Local was founded in 1908 by Fred B. Snite; it was (Green Bay area) 1 incorporated in 1928. Racine 1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 719 Local’s consolidated total assets are $95.2 mil­ liquidate its indebtedness to individual banks for lion. Local’s ranking among finance companies in 30 or 60 days each year. The agreements also the United States is seventieth ($32.5 million) in allow cancellation of the credit lines at any time capital funds and seventy-fifth ($84.8 million) in at the lending bank’s discretion. net receivables.26,27 During the three-year period ending December Exclusive of the captive finance companies, 30, 1974,31 Local has increased consolidated Local’s ranking is forty-first in capital funds and assets by 25% ($95.2 million from $76.7 million), forty-third in net receivables among independent and total equity capital by .2% ($28.3 million from finance companies. Eighty-two per cent ($72.2 $27.7 million). During the same period, the con­ million) of Local’s total volume of receivables solidated net income has decreased 58% ($1.04 outstanding represents direct cash loans to indi­ million from $2.44 million). Local has not entered viduals on an installment basis; eighteen per cent a new State since 1945, a new market service area ($15.5 million), represents retail installment con­ since 1953, nor opened a new office, as distin­ tracts.28,29 Four states, California, Illinois, Ore­ guished from the division of the accounts of an gon, and Wisconsin account for 74.2% of its total office into two offices, since 1959. It has expanded volume of receivables. its operations from 118 offices to 124 offices by In the market service areas in which it operates, such divisions since 1969. Local’s receivables are Local’s share of the estimated total market is in $724 thousand per office as compared to $942 a range of .21% to 4.38% with a median of 1.37%. thousand per office, and $127 thousand per em­ Local’s largest share is in Medford, Oregon. In ployee as compared to $198 thousand per em­ the 28 market service areas in the four States ployee for the industry according to Local’s and contributing the largest volume of receivables, the consumer finance industry statistics.32 Local’s Local’s share of the estimated total market is in growth rate has been 3.2% per year as compared the same range, with a median of 1.62%. In the to 7.4% for the industry according to the same other 10 market service areas (in 8 States) the statistics. range is .63% to 2.61% with a median of .87%. The agreement between Applicant and Local In each of the service areas, Local is‘competing provides for the purchase of all of the outstanding against numerous other finance companies, both shares of Local by Applicant for $30 million.33 independent and captive, banks and credit union The source of the funds for the purchase of Local offices.30 Most of the 10 highest ranked finance is an issuance of $125 million in floating rate notes companies as well as many companies ranked due 1989 issued at 7.8% in March 1974. above Local, both in total capital funds and net Local is motivated to sell by the expectation receivables, compete with Local in substantially of tax liabilities arising from Mr. Snite’s eventual all significant market areas. demise. It has been anticipated that the liability Local uses as a source of funds its equity capital for taxes at that time will be $6.3 million.34 The and bank loans, and has not attempted to use plan for payment of such taxes anticipates Local’s commercial paper. Bank loans at the prime rate purchase of sufficient of Snite’s 28.6% share of have provided for compensating balances which the Local stock to provide the necessary funds. can not be withdrawn absent termination of the This would decrease the equity of Local and, in issues of credit; as of December 31, 1973, $5.4 million was deposited in these banks. Addition­ ally, the use of these lines of credit has been restricted by agreements requiring the company to 31 Five-year figures were not introduced in the hearing. 32 Comparative figures are based upon overall industry fig­ ures for 1974 published by the National Consumer Finance Association. These figures do not reflect all companies, or all companies of different size categories, but only of reporting 26It is estimated that Local has outstanding 150,000 loans. companies. 27Local’s debt to adjusted capital ratio in 1973 was 2.4:1. 33 Applicant contends that the $30 million represents essen­ This was well below average for the peer group of independent tially no premium since book value is conservatively estimated consumer finance companies. at $28.5 million. Based upon book value, the premium would 28 As of December 31, 1973. be 5.2%. 29 Local does not presently engage in the mobile home 34No evidence was offered on the full extent of Mr. Snite’s financing business. present estate, nor is it considered necessary to these conclu­ 30Within its service areas, Local is in direct competition sions that there be such disclosure. This is despite the statement with 2,137 finance company offices, 3,317 banks and 3,644 by witness Suskin that the validity of the tax estimate cannot credit union offices. be tested without such evidence. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

720 Federal Reserve Bulletin □ August 1976 order to maintain the same debt to equity ratio, number of offices is to be increased by 50 with would substantially contract Local’s operations. 280 additional employees. Additionally during the The effect is illustrated as follows (assuming debt first year, Local is to begin offering new loan to equity ratio remains constant): services such as, loan consolidation loans, second 1974 Proposed mortgage loans, executive and professional loans, Equity $28.3 million $22 million insurance premium loans, and home improvement Liabilities $66.9 million $52 million loans. Other new loan services would be offered ($6.3 million x 2.36 = $14.9 decline in liabilities) later. In addition to new types of loans, Applicant Net Recfeivables $84.8 million $63.6 million ($6.3 million + $14.9 million to reduce liabilities = will raise the loan amounts and extend the maturity $21.2 reduction) terms of loans. All of these were offered by Such an event was contemplated by Local and Applicant as benefits to the public and are dis­ a bank in a letter of agreement of 1972 which cussed below. related to lines of credit.35 At that time, it was Applicant denies that it would enter the market stated as follows: on a de novo basis.37 In support of its rejection Sec. 5.18 is amended so that existing Lines 18, of de novo entrance into the consumer finance 19 and 20 should be deleted and the following industry through a non-banking subsidiary Appli­ language substituted: cant cites the cost, the lack of an organization and “Purpose of making funds available to the estate trained staff (primarily qualified management), and of Mr. Fred B. Snite for the payment of estate the risk of a de novo entry. The evidence is and/or inheritance taxes on his estate, and/or for uncontradicted that the investment would be in the the purpose of redeeming any stock in his estate, range of $100 million to $120 million ($10 million a sum or sums not exceeding $10,000,000.00 in to $30 million to duplicate Local’s operations and the aggregate to the purchase or redemption, in $88 million in loanable funds). In addition, Ap­ either case at not more than a reasonable” plicant cites the need to employ an entire 650 The proposed contraction of Local anticipates person staff including top and mid-level manage­ the withdrawal from three states, Florida, Ne­ ment. Assuming Applicant could establish an op­ braska, and New York. In addition, eight offices erational company it is Applicant’s position that would be closed in Wisconsin, two in California, the risk involved would be too high to justify the three in Illinois, two in Minnesota, one in Oregon endeavor. and two in Washington. The reduction in the number of offices would be from 124 to 98 result­ Conclusions ing in a decrease in staff by 140 employees. Additionally, credit standards would be tightened. The Applicant is one of the major financial The projection is to reduce receivables from $88 institutions in the United States. The evidence million to $60 million. With the economies pro­ supports Applicant’s self-characterization as a jected, Local’s income would rise from $446 prudent and conservative bank holding company. thousand to $714 thousand. While some contrac­ Local is a medium sized sub-national or multition apparently has long been anticipated, the regional consumer finance company. The states above described plan was only developed in the and market service areas where it does not operate Fall of 1974 as an alternative to approval of this cannot be regarded as insignificant in the national application. consumer finance market; its absence from these Upon approval of the acquisition, Applicant plans to begin a program of expansion of Local’s operations.36 The expansion is to be accomplished by the concurrent increase in loanable funds, the increase of the debt to adjusted capital ratio from 36 The existence of the plan is established by evidence of a firm policy commitment. It is reflected in the several propos­ 2.4:1 to 5:1, and the reduction of the reserve for als submitted to the Applicant’s Board of Directors as well bad debts from 4.7% to 3.9% of receivables. The as the testimony of witnesses Barnes and Kalchek. As noted by Protestant, there are certain discrepancies in the four ver­ sions [the Application, the base computations (Applicant’s Exhibit 17), the July formal proposal (Applicant’s Exhibit 29) and the August formal proposal (Applicant’s Exhibit 30)] and the testimony of witness Barnes. As far as the issues in this case, there are no material differences in the several presenta­ 35 To the same effect were agreements with other sources tions which are explained as evolutionary stages of the plan. of funds as early as 1966. 37Witness Barnes testified on Applicant’s evaluation of de 36See opposite column for footnote. novo entry. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 721 markets preclude its being termed national. On the a. 50 new offices in five years in new market other hand, the number and dispersal of market service areas in states where Local now areas where it does operate are substantially operates; greater than normally contemplated by the term b. Increase in loan receivables by 100% in five regional. Like Applicant, Local could be charac­ years, from the present $88 million to $176 terized by the terms prudent and conservative. The million which would exceed Local’s projec­ company is a significant participant in many of tion by $116 million (193%); its market service areas, however, it is not the c. Addition of new services to customers. dominant participant in any. Local’s business phi­ 3. Increased efficiency of Local resulting in losophy is reflected by its better than average more effective competition in the market place quality of accounts receivable, its lower than including: average debt to equity ratio, its above average loan a. Availability of more funds primarily by the loss reserve, its consistency as a profit making Applicant’s access to the commercial paper concern, and the conservative policies of Mr. Snite markets; and his management team. Local’s growth reflects b. Better organization resulting in economic its other conservative policies; it has grown in total efficiencies of larger scale operations; assets and equity while failing to expand geo­ c. Availability of corporate planning, market­ graphically. Recently, there has also been a de­ ing, economics and statistical departments. crease in net income.38 The first proposed benefit is based on averting The 1970 Amendments to the Act require that the planned contraction of Local upon Mr. Snite’s consideration be given to whether a proposed demise. As noted above, the proposal contem­ enterprise “can reasonably be expected to produce plates abandonment of market service areas, the benefits to the public, such as greater convenience, reduction of accounts (both number and amount), increased competition, or gains in efficiency, that and more restrictive lending policies. Protestant outweigh possible adverse effects, such as undue argues that there are viable alternatives to the plan; concentration of resources, decreased or unfair these include an increase in the low debt to equity competition, conflicts of interest, or unsound ratio and the public sale of Local stock. The banking practices.”39 The burden of proof is on existence of alternatives for Local, however, is not the applicant to show, “that its carrying on a the issue before the Board, and determination of particular nonbank activity would produce benefits the case on this basis would be substituting the to the public that outweigh any adverse effects.” Board’s business judgment for Local’s own man­ House Conference Report on the 1970 Amend­ agement. It is sufficient that there exists a valid ments to the Act. H. R. Report No. 91-1747, 91st basis for the course of action, that Local’s man­ Cong. 2d Sess. 17 (1970) [Hereinafter cited as agement has decided on a reasonable course of House Conference Report.]40 Only if this test is action (in this case the sale of the company as met can the Board lawfully approve an applica­ an operating business), and that the plan is not tion.41 a mere sham created in expectation of these pro­ Applicant proposes as public benefits of the ceedings. The issue before the Board is whether acquisition the following: the Applicant should be allowed to buy Local. 1. Removal of the constraints on Local imposed There is no doubt that abandonment of the by the projected repurchase of outstanding shares market (both full or partial) by a significant seller and the resultant contraction of the business. of services decreases competition.42 It is concluded 2. Substitution of a policy of growth and revi­ that removal of the inevitable contraction of Local talization of Local: is a benefit to the public. The second proposed benefit is based on a policy 38This can largely be attributed to the cost of money rather than any problems within Local’s organization. 42BankAmerica Corporation, 58 Fed. Reg. 22578, 59 Fed. 39Section 4(c)(8) of the Act. Res. Bui 687 (1973) (financial difficulties possibly impairing 40Cited by the Board in Bankers Trust New York Corpora­ continuance as a viable competitor), and Citizens and Southern tion, 38 Fed. Reg. 21822, 59 Fed. Res. Bui. 694 (1973). National Bank, et al., 39 Fed. Reg. 15071, 60 Fed. Res. Bui. 41 It is uncontested that the business of Local as a consumer , 379 (1974) rev. and rem. on other ground sub. nom. Inde­ finance company is closely related to business of banking pendent Bankers of Ga. v. Board of Governors __F. 2d__ within the meaning of the Act. (1975) (restrictions on loan amounts imposed by management). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

722 Federal Reserve Bulletin □ August 1976 of growth to be established after acquisition as an traditionally operated with a low asset to equity alternative to Local’s contraction plan. Finan­ ratio using bank lines of credit as a source of funds cially, the plan is initiated by infusing new money at an effective rate higher than prime. Applicant into Local, reducing the debt to capital ratio from plans to primarily rely on commercial paper as 2.4:1 to 5:1, and reducing the debt reserve by $1.5 a source of funds and to rely on bank loans as million to the industry average of 3.9%. Opera­ a supplement. The evidence is uncontradicted that tionally, the expansion contemplates increasing the commercial paper on a long run basis pays lower number of offices by 50, the loan receivables by interest than bank base prime rate. The Board has 100% to $176 million, and the addition of new recognized easier access to funds as a public services in the form of new types of loans, in­ benefit. BankAmerica Corporation, supra., Caro­ creased loan limits and length of maturity of loan. lina BanCorp., Inc., supra., and First National Protestant argues that the proposal is a sham which Holding Corp., supra. The economies of scale would not, in fact, benefit the public. other than the availability to the commercial paper All the evidence in the hearing is consistent with market are not sufficiently established or defined the existence of Applicant’s plans for expansion to support a finding as a benefit. It would appear, of Local. The plans as presented to the Board and however, that the availability of corporate services to Applicant’s directors all contemplate a detailed could represent a significant improvement in expansionary scenario. The Board has on nu­ efficiency. The services listed by Applicant, plan­ merous occasions determined the provision of ning, marketing, economics, personnel and statis­ more services to the public to be pro-competitive tics, should all strengthen Local’s position among and a benefit to the public.43 In view of the consumer finance companies.45 These appear to be objective evidence of a firm policy commitment the type of services necessary for Local to become of Applicant to the expansion of current services, a national competitor in the field. it is concluded that the proposed expansion of It is concluded that the availability of funds and services constitute a benefit to the public.44 corporate strategic services should result in The final benefit proposed by Applicant is in­ strengthening of Local as a consumer finance creased efficiency through availability of new company which should result in its being more funds to Local, better organization resulting in competitive in the market. economies of scale, and the availability of Appli­ Although it appears that there are benefits to cant’s corporate strategic services. Protestant at­ the public to be obtained by approval of the tacks the availability of funds as contemplated by acquisition, it is also necessary to determine commercial paper as not an advantage. He also whether possible adverse effects may exist which denies the existence of economies of scale in the should prevent approval of the application. The consumer finance industry. Protestant also ques­ adverse effects listed in Section 4(c)(8) are “con­ tions the need for management services to Local. centration of resources, decreased or unfair com­ As noted above, Local has been a successful petition, conflicts of interest, and unsound banking consumer finance company for 70 years. This practices.” alone is an indication of the competence of man­ Of the first of the possible adverse effects, the agement, both executive and operational. It has Conference Report on the 1970 amendment to the Act stated in part as follows: The danger of undue concentration of economic resources and power is one of the factors which led to the enactment of this legislation, and con­ 43Citizens and Southern National Bank, et al., supra., and stitutes a significant threat to the continued healthy BankAmerica Corporation, supra., (expansion of lending evolution of our free economy. American trade services, new types of loans); Tennessee National Bancshares, has always operated on the principle that relation­ Inc., 38 Fed. Reg. 23364, 59 Fed. Res. Bui. 700 (1973) (new offices, application denied on other grounds); Chase Manhattan ships between businessmen, large and small, Corporation, 39 Fed. Reg. 4814, 60 Fed. Res. Bui. 142 (1974) should be founded on economic merit rather than (new offices, new types of loans, larger loan amounts, and longer loan periods; application denied on other grounds). monopoly power. Our national policies of limited Carolina BanCorp., Inc., 39 Fed. Reg. 34715, 60 Fed. Res. Bui. 733 (1974) (new services). First National Holding Corp., 39 Fed. Reg. 28565, 60 Fed. Res. Bui. 603 (1974) (new offices). 44Cf. Carolina BanCorp., Inc., supra., (denial of applica­ tion as to National Finance Company, Inc., because of absence 45Cf. Chase Manhattan Corporation, supra., and Bankers of objective evidence and firm policy commitment). Trust New York Corporation, supra. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 723 governmental regulation and interference in trade which did not have a consumer finance company and commerce, however, do make it possible for subsidiary, of the eleventh largest consumer fi­ undue concentrations of resources and economic nance company, GAC Finance, Inc. In that case, power to override fundamental fairness and eco­ GAC was not in the business of providing neces­ nomic merit when responding to the profit motive. sary credit related services to competitors. The This possibility is enhanced when concentrations major concern in that case was the effect on actual of power are centered about money, credit and competition in several market areas, and Bankother financial areas, the common denominators America was required to divest itself of the GAC of the economy. . . . The dangers of undue operations as operating units in areas of competi­ concentration of resources include, but are not tion. The Board found the post-divestiture acqui­ limited to, specific competitive effects, which are sition not to constitute an undue concentration of themselves relevant factors under the Act. It resources. The elimination of the situation which should be clear that this legislation directs the would have decreased direct competition resulted Board to consider all reasonable ramifications of in approval of the application. the concentration of resources in fulfilling its re­ Finally, in Citicorp, ____Fed. Reg_____, sponsibilities under section 4.46 ____Fed. Res. Bui_____(November 10, 1975), The Board rulings are instructive as to situations the Board rejected the application of the second contemplated as undue concentrations. largest bank holding company to acquire through In Chase Manhattan Corp., supra., the second its consumer finance subsidiary, Nationwide, two largest bank holding company, which did not additional consumer finance subsidiaries, Federal previously have a consumer finance company sub­ Discount, the twentieth, and Amfac Credit, the sidiary, sought to acquire Dial Finance Corpora­ twenty-eighth largest consumer finance company. tion, the twenty-first largest independent consumer The Board stated as follows: finance company. In its decision denying approval While the elimination of existing, future, and the Board commented on concentration of credit potential competition between Nationwide and granting resources as follows: each of the Finance Companies is a source of “It is the Board’s judgment that approval of concern to the Board when viewed as individual this application involving acquisition by one of the factors, it represents an even more serious adverse nation’s largest bank holding companies of a major effect of these proposals when examined, as the consumer finance company with a large national Board believes it must be, in conjunction with a network of offices and a commanding position in collateral issue that has greater implications with the market for provision of data processing serv­ respect to the public interest. The facts on record ices to the industry involves the issue of concen­ of these applications show that Applicant is one tration of credit granting resources that was within of the leading bank holding companies in the the intent of Congress in enacting the 1970 United States, that it already has a consumer amendments. While the matter is not free of doubt, finance subsidiary which is both substantial and and is one on which reasonable differences of growing in size, that Applicant’s subsidiary has judgment may occur, the Board has concluded that achieved a significant presence in the finance at a minimum, this factor weighs against approval company industry, and that Applicant has gained of the application.” expertise and managerial talent in this financial Thus in addition to size, the Board emphasized area. The Board is of the view that, when all of that Dial was in the business of providing vital these factors are present, a proposal involving data processing services to Dial’s competitors. subsequent acquisitions of additional finance com­ Also, in Chase Manhattan there was substantial panies which are more than insignificant footholds direct competition between the applicant’s banks in the consumer finance industry offers substan­ and Dial in the New York State market. tially diminished returns to the public interest. In a comparable situation, the Board in Bank- Further, the Board stated: America Corporation, supra., approved the ac­ If banking organizations that already have fairly quisition by the largest bank holding company, sizable consumer finance subsidiaries are permitted to make additional acquisitions of the relatively few remaining independent consumer finance firms, substantial barriers to entry into the con­ 46House Conference Report cited by the Board in Bank- America Corporation, supra. sumer finance industry would be raised. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

724 Federal Reserve Bulletin □ August 1976 The concentration of credit granting resources clusion is that approval of the application will not here proposed is not of the magnitude, or in the result in decreased or unfair competition. absence of a concentration of necessary services Finally, “unsound banking practices” is listed to the industry, of the type commented on in Chase as an adverse effect. The Board has required that Manhattan. Neither is it comparable to the actual proposed acquisitions be a source of strength of concentration approved of in Bank America. Fur­ the bank holding company. Where the consumer thermore, the concentration disapproved of in finance company’s financial situation has been so Citibank is not reflected here in the absence of impaired that it might significantly weaken the an existing subsidiary of Applicant in the con­ bank involved, approval has been denied. Conti­ sumer finance industry. It is concluded, therefore, nental Banksystem, Inc., 38 Fed. Reg. 18491, 59 that acquisition sought herein does not constitute Fed. Res. Bui. 597 (1973), and UB Financial “concentration of resources” as contemplated by Corp., 39 Fed. Reg. 37831, 60 Fed. Res. Bui. the Act. 791 (1974). The evidence here does not support The second adverse effect listed in the statute such a conclusion. Both Applicant and Local are is “decreased or unfair competition.” The Con­ prudent and conservative with low asset to equity ference Report47 stated on this subject as follows: ratios. Also regardless of Local’s equity, the addi­ “Where a bank holding company seeks to en­ tion of Local’s assets to those of Applicant would gage in related activities through acquisition, in not significantly affect the Applicant’s asset to whole or in part, of a going concern, the elimina­ equity ratio. It is, therefore, concluded that ap­ tion of existing competition will be an important proval of the acquisition will not lead to unsound negative factor, for other subsidiaries of the bank banking. holding company, or the company itself, may There is no evidence to support a conclusion already be providing the products and services in that Applicant should be perceived as a potential the market served by the company to be acquired. de novo entrant in the consumer finance industry. In such circumstances, where the possible benefits However, presently Local has numerous bank, to the public of bank holding company activity captive and independent consumer finance com­ are already being provided, the elimination of an pany, credit union, and retail merchant competi­ independent competitive alternative will weigh tors in each of its market service areas. Further heavily in the balance against approval.” the Board has found that extension of consumer The Board has determined that consumer fi­ finance companies by de novo entrance into new nance companies generally compete with com­ market service areas is relatively easy. First Com­ mercial banks in the area of small loans to indi­ mercial Bank, Inc. and First National Holding viduals. Bankers Trust New York Corporation, Corp., supra. Further the Board has found that supra. This has been interpreted by the Board to entrance de novo into the consumer finance in­ require the disapproval of applications where there dustry is feasible for some bank holding compa­ is direct competition between the applicant and the nies. Chase Manhattan Corporation, supra, and finance company to be acquired unless the direct BankAmerica Corp., supra. Thus it appears that competition can be eliminated by divestiture. despite Applicant’s rejection of de novo entrance Chase Manhattan Corporation, supra., Bank- in the industry and the absence of a consumer America Corporation, supra., First Commercial finance subsidiary of Applicant to enter market Bank, Inc., 37 Fed. Reg. 25795, 59 Fed. Res. areas de novo, there exist numerous present and Bui. 1036 (1972), and First National Holding potential competitors of Local.48 Corp., 38 Fed. Reg. 5285, 59 Fed. Res. Bui. 203 On the basis of the foregoing and the entire (1973). Absent the existence of direct competition, record, it is concluded that significant benefits to the Board has determined that all “acquisition the public exist and that there are no reasonable can[not] be presumed per se to affect competition adverse effects to the Applicant’s application for adversely.” BankAmerica Corporation, supra. prior approval to acquire Local. Further, it appears Under the circumstances the only reasonable con­ 48Further, the Board has concluded that even for the leading financial institutions a foothold entry is an acceptable alterna­ 47House Conference Report. tive to de novo entry. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 725 that the only basis upon which the application applied for the Board’s approval under § 4(c)(8) could be denied would be a conclusion that bigness of the Act (12 U.S.C. § 1843(c)(8)) and § per se is contrary to the purposes of the Act and 225.4(b)(2) of the Board’s Regulation Y (12 CFR that any acquisition of a significant consumer fi­ § 225.4(b)(2)), to engage de novo in the activity nance company by a leading or major bank holding of providing management consulting advice to company should be prohibited. There exists no nonaffiliated commercial banks through Appli­ legal authority for such a conclusion. On the cant’s wholly-owned subsidiary, Empire Group, contrary Applicant’s acquisition of Local is a Inc. (“Empire”), Natick, Massachusetts. Such “foothold acquisition” as contemplated in Chase activities have been determined by the Board to Manhattan Corporation, supra., and Bank­ be closely related to banking (12 CFR § America Corporation, supra. Accordingly, it is 225.4(a)(12)). recommended that the application be approved. Notice of the application, affording opportunity for interested persons to submit comments and Conclusions of Law views on the public interest factors, has been duly published (41 Federal Register 9936). The time 1. The Applicant is a bank holding company for filing comments and views has expired, and within the meaning of Section 2(a)(1) of the Act the Board has considered the application and all [12 C.F.R. 225.2(a)(1)]. comments received, including those submitted by 2. Local is engaged in the consumer finance the United States Department of Justice, in the business, an activity determined by the Board to light of the public interest factors set forth in § be closely related to the business of banking within 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)). the meaning of Section 4(a)(1) and (2) of the Act Applicant, the seventh largest commercial [12 C.F.R. 225.4(a)(1) and (2)]. banking organization in Massachusetts, controls 3. Approval of the acquisition by Applicant of five banks with aggregate deposits of approxi­ Local and the consummation of the proposal can mately $531 million, representing 3.7 per cent of reasonably be expected to produce benefits to the the total deposits in commercial banks in the public that outweigh possible adverse effects State.1 Applicant presently engages in a variety within the meaning of Section 4(c)(8) of the Act of permissible nonbank activities through a num­ [12 C.F.R. 225.4(c)(8)]. ber of direct and indirect nonbank subsidiaries. Applicant’s nonbank activities include factoring, Recommended Order making loans secured by second mortgages on real property, personal property leasing on a full- It is recommended that the application of Mellon payout basis, and selling credit life and credit National Corporation, for prior approval to acquire accident and health insurance which is related to all outstanding shares of Local Loan Co. and its extensions of credit by Applicant’s lending sub­ subsidiaries, pursuant to Section 4(c)(8) of the sidiaries. Bank Holding Company Act of 1956 as amended, Through Empire, Applicant proposes to engage be approved. de novo in providing management consulting ad­ Issued at Washington, D.C. on March 11, 1976. vice to nonaffiliated commercial banks on an ex­ (Signed) James W. M ast, plicit fee basis. Such advice would relate Administrative Law Judge principally to the collection of consumer loans, Department of Housing and Urban Development including but not limited to offering advice on Washington, D.C. 20410 bank collection procedures, loan documentation, repossession techniques, disposal of repossessed property, personnel management, and compliance W orcester Bancorp, Inc., with consumer protection laws. Since Applicant W orcester, M assachusetts proposes to engage in these activities de novo, it does not appear that any meaningful competition Order Approving would be eliminated or potential competition fore­ Management Consulting Activities Worcester Bancorp, Inc., Worcester, Massa­ 1 All banking data are as of June 30, 1975 and reflect holding chusetts, a bank holding company within the company formations and acquisitions approved by the Board meaning of the Bank Holding Company Act, has through April 30, 1976. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

726 Federal Reserve Bulletin □ August 1976 closed as a result of approval of the application. Based upon the foregoing and other consid­ Rather, it appears that Applicant’s de novo entry erations reflected in the record, the Board has into this industry should have a procompetitive determined that the balance of the public interest effect by increasing the number of firms offering factors the Board is required to consider under § this specialized consulting advice. Furthermore, 4(c)(8) is favorable. Accordingly, the application by making this service available on an explicit fee is hereby approved. This determination is subject basis rather than as a correspondent banking serv­ to the conditions set forth in § 225.4(c) of Regu­ ice, clients will be able to more accurately analyze lation Y and to the Board’s authority to require the cost of such services and may be able to more such modification or termination of the activities efficiently allocate their funds. of a holding company or any of its subsidiaries There is no evidence in the record to indicate as the Board finds necessary to assure compliance that Applicant’s engaging in the activity of pro­ with the provisions and purposes of the Act and viding management consulting advice would result the Board’s regulations and orders issued in any undue concentration of resources, unfair thereunder, or to prevent evasion thereof. competition, conflicts of interests or unsound The transaction shall be made not later than banking practices.2 three months after the effective date of this Order, unless such period is extended for good cause by 2In connection with the subject application, the United States the Board or by the Federal Reserve Bank of Department of Justice submitted a letter expressing concern that possible conflicts of interests could result from approval Boston. of this proposal. However, at the time the Board adopted the By order of the Board of Governors, effective activity of providing management consulting advice to July 7, 1976. nonaffiliated banks pursuant to section 4(c)(8) of the Act, the Board considered the potential for conflicts of interests resulting from a bank holding company’s engaging in this activity. In recognition of this potential, the Board incorporated in Regu­ lation Y a number of restrictions upon a bank holding com­ Voting for this action: Chairman Burns and Gover­ pany’s performance of this activity, including the stipulation nors Gardner, Wallich, Coldwell, Jackson, Partee and that any bank holding company providing management con­ sulting advice must disclose to each potential client bank the Lilly. names of all banks which are affiliates of the consulting company and the names of all existing client banks located in the same market area(s) as the potential client. The Board is of the opinion that these restrictions provide ample protection (Signed) J. P. G arbarini, against possible conflicts of interests. [seal] Assistant Secretary of the Board. O rders A pproved U nder B ank H olding C ompany A ct By the Board of Governors During July 1976, 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 Hastings State Company, Hastings State Bank, 7/19/76 41 F.R. 31263 Hastings, Nebraska Hastings, Nebraska 7/27/76 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 727 Section 4 Board action Federal Nonbanking company (effective Register Applicant (or activity) date) citation First Missouri Banks, Inc., First Missouri 7/12/76 41 F.R. 29495 Creve Coeur, Missouri Insurance Group, 7/16/76 Phoenix, Arizona O rder A pproved U nder B ank M erger A ct— By Federal Reserve Banks During July 1976, application was approved by the Federal Reserve Bank as listed below. The order has been published in the Federal Register, and copies are available upon request to the Reserve Bank. Federal Reserve Effective Register Applicant Bank(s) Bank date citation First Guaranty Bank, Schoolfield Richmond 7/20/76 41 F.R. 32293 Hurt, Virginia Bank and 8/2/16 Trust Company, Danville, Virginia P ending C ases Involving the B oard of G overnors* International Bank v. Board of Governors, et A.R. Martin-Trigona v. Board of Governors, al., filed July 1976, U.S.D.C. for the District et al., filed June 1976, U.S.D.C. for the of Columbia. District of Columbia. North Lawndale Economic Development Cor­ Save Needed Environmental Levels League v. poration v. Board of Governors, filed June Southern California Company, et al., filed 1976, U.S.C.A. for the 7th Circuit. May 1976, U.S.D.C. for the Central District Central Wisconsin Bankshares, Inc. v. Board of California. of Governors, filed June 1976, U.S.C. A. for National Urban League, et al. v. Office of the the 7th Circuit. Comptroller of the Currency, et al., filed April 1976, U.S.D.C. for the District of Columbia Circuit. *This list of pending cases does not include suits against Farmers & Merchants Bank of Las Cruces, the Federal Reserve Banks in which the Board of Governors is not named a party. New Mexico v. Board of Governors, filed Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

728 Federal Reserve Bulletin □ August 1976 April 1976, U.S.C.A. for the District of of Governors, filed August 1975, actions Columbia Circuit. consolidated in U.S.C.A. for the Fifth Cir­ United States ex rel. A.R. Martin-Trigona v. cuit. Arthur F. Burns, et al., filed March 1976, Bank of Boulder v. Board of Governors, et al., U.S.D.C. for the District of Columbia. filed June 1975, U.S.C.A. for the Tenth Cir­ Grandview Bank & Trust Company v. Board cuit. of Governors, filed March 1976, U.S.C.A. t tDavidR. Merrill, etal. v. Federal Open Market for the Eighth Circuit. Committee of the Federal Reserve System, Association of Bank Travel Bureaus, Inc. v. filed May 1975, U.S.D.C. for the District of Board of Governors, filed February 1976, Columbia, appeal pending, U.S.C.A. for the U.S.C.A for the Seventh Circuit. District of Columbia. Memphis Trust Company v. Board of Gover­ Curvin J. Trone v. United States, filed April nors, filed February 1976, U.S.D.C. for the 1975, U.S. Court of Claims. Western District of Tennessee. Louis J. Roussel v. Board of Governors, filed First Lincolnwood Corporation v. Board of April 1975, U.S.D.C. for the Eastern District Governors, filed February 1976, U.S.C.A. of Louisiana. for the Seventh Circuit. Georgia Association of Insurance Agents, et al. Helen C. Hatten, et al. v. Board of Governors, v. Board of Governors, filed October 1974, filed January 1976, U.S.D.C. for the District U.S.C.A. for the Fifth Circuit. of Connecticut. Alabama Association of Insurance Agents, et International Bank v. Board of Governors, filed al. v. Board of Governors, filed July 1974, December 1975, U.S.C.A. for the District U.S.C.A. for the Fifth Circuit, of Columbia. tInvestment Company Institute v. Board of Gov­ Roberts Farms, Inc. v. Comptroller of the Cur­ ernors, dismissed July 1975, U.S.D.C. for rency, etal., filed November 1975, U.S.D.C. the District of Columbia, appeal pending, for the Southern District of California. U.S.C.A. for the District of Columbia Cir­ National Computer Analysts, Inc. v. Decimus cuit. Corporation, et al., filed November 1975, East Lansing State Bank v. Board of Gover­ U.S.D.C. for the District of New Jersey, nors, filed December 1973, U.S.C.A. for the tPeter E. Blum v. First National Holding Cor­ Sixth Circuit, poration, filed November 1975, U.S.D.C. for tConsumers Union of the United States, Inc., the Northern District of Georgia, et al. v. Board of Governors, filed September tPeter E. Blum v. Morgan Guaranty Trust Co., 1973, U.S.D.C. for the District of Columbia. et al., filed October 1975, U.S.D.C. for the Bankers Trust New York Corporation v. Board Northern District of Georgia, of Governors, filed May 1973, U.S.C. A. for tLogan v. Secretary of State, et al., filed Sep­ the Second Circuit. tember 1975, U.S.D.C. for the District of Columbia. Florida Association of Insurance Agents, Inc. t Decisions have been handed down in these cases, subject to appeals noted. v. Board of Governors and National Asso­ $The Board of Governors is not named as a party in this ciation of Insurance Agents, Inc. v. Board action. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

729 A nnouncem ents R E G U L A T IO N G : A m endm ents and will cut the annual reporting burden from 2,800 reports to 350 reports. The Board of Governors has announced a reduc­ Revisions will be made to Forms G-l (Regis­ tion in the paperwork and reporting required in tration Statement), G-2 (Deregistration State­ the regulation of securities credit, effective August ment), and G-4 (Quarterly Report) to reflect the 20, 1976. new amendments. Amendments to the Board’s Regulation G gov­ erning securities credit by lenders other than banks and broker-dealers will reduce by half the number B O A R D ST A T E M E N T : of persons subject to the regulation, yet continue C eiling R ate on IR A ’s to regulate 98 per cent of the credit covered under the regulation. The Board of Governors has said that it will give The action is part of a continuing effort by the further consideration early next year to the ques­ Board to reduce the reporting burden on the public tion of whether commercial banks should be per­ and to deregulate lenders over which regulatory mitted to pay the same ceiling rate of interest on control is no longer essential. individual retirement accounts as do thrift institu­ Regulation G, issued in 1968, applies to certain tions. types of securities credit extended, arranged, or Further consideration of possible action to per­ maintained by lenders other than banks and mit member banks to offer IRA’s on a fully com­ broker-dealers, such as credit unions and insurance petitive basis with thrift institutions will be appro­ companies. The regulation is designed to prevent priate in early 1977 when the Congress is consid­ the excessive use of securities credit by such ering an extension of interest rate ceilings for lenders. financial institutions, the Board added. The amendments will: There is some evidence, as yet inconclusive, 1. Reduce the frequency of reporting by Regu­ indicating that member banks may be at a com­ lation G lenders. Reports will be required of all petitive disadvantage in competing with thrift in­ Regulation G lenders on an annual instead of a stitutions for IRA deposits, the Board said. Sav­ quarterly basis. ings institutions generally may pay rates of interest 2. Decrease the number of persons subject to on such deposits XA of a per cent higher than the regulation. This will be done by increasing commercial banks. The Board will continue to the minimum amount of credit that subjects a monitor the growth of IRA accounts at all financial lender to the regulation. The minimum amount of institutions. credit extended or arranged will be $100,000 in The Board indicated that under the provisions any calendar quarter (instead of $50,000) and in of Public Law 94-200, passed in December 1975, the case of credit outstanding, the minimum any action by the Board to eliminate or reduce amount will be raised from $100,000 to $500,000 an interest rate differential for any category of at any time during the calendar quarter. deposit that was in effect on December 10, 1975, 3. Establish a floor of $200,000 for credit out­ would require approval by the Congress before it standing during any 6-month period for deregis­ could become effective. tration of a lender. Under the present rule deregis­ Individual retirement accounts are retirement tration may occur only when no credit is outstand­ savings deposits that may be established under the ing. Employee Retirement Income Security Act of These provisions will cut in half the approxi­ 1974 by individuals not covered by an employer mately 700 lenders registered under Regulation G retirement plan. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

730 Federal Reserve Bulletin □ August 1976 PR O PO SE D A M E N D M E N T S need not be separately stated in disclosures given to the consumer. The Board requested comment A N D IN T E R PR E T A T IO N by September 27, 1976. The Board of Governors has announced that it would consider possible adoption of providing management consulting advice to certain types of nonaffiliated financial institutions as an activity SY ST E M M E M B E R SH IP: permissible for bank holding companies (Regula­ A dm ission of State B ank tion Y—Bank Holding Companies). The Board will receive comment on the proposed amend­ The following bank was admitted to membership ments and on a related application, through Sep­ in the Federal Reserve System during the period tember 8, 1976. July 16, 1976, through August 15, 1976: The Board has also proposed an interpretation of its Regulation Z (Truth in Lending) to state that California when a dealer and a creditor share in the interest San Francisco ..........................Pacific Securities on a consumer credit contract such participation Depository Trust Company Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

731 In d u stria l P roduction Released for publication August 13 recovery, has recently been sluggish. However, production of durable goods materials continued Industrial production increased by an estimated 0.2 to advance strongly in July to a level approxi­ per cent in July following rises of 0.4 in June and mately 25 per cent above the low in the second 0.9 in May. Most major sectors of production quarter of 1975 but still 6 per cent below the showed little change or small increases last month. pre-recession high. The materials capacity utiliza­ Over-all activity was also dampened somewhat in tion rate was 81 per cent in July, 13 per cent below July by increased strike activity, notably in coal the 1973 peak. mining. At 130.4 per cent of the 1967 average, 1967=100 the index is now almost 17 per cent above the Seasonally adjusted, ratio scale, March 1975 trough. Output of consumer goods was apparently un­ changed in July. After allowance for model changeover, auto assemblies edged off slightly from June; production schedules that are currently available indicate little change for the remainder of the third quarter. Production of other consumer durable goods was almost unchanged, as small rises in furniture, carpeting, and miscellaneous goods were offset by a decline in appliance pro­ duction. After a substantial rise early this year, output of business equipment has shown only modest increases in recent months, rising by 0.3 per cent in both June and July. Production of construction supplies rose 0.4 per cent in July. Output of nondurable goods materials, which had rebounded strongly in the early part of the Note.—Historical industrial production data on the newly revised basis is expected to be available by F.R. indexes, seasonally adjusted. Latest figures: July. mid-September. *Auto sales and stocks include imports. Seasonally adjusted, 1967 = 100 Per cent changes from— 1976 Industrial production Apr. May Junep July6 Month Year Ql to ago ago Q2 Total .......................................................................... 128.4 129.6 130.1 130.4 .2 10.1 1.9 Products, total ................................................................... 128.0 128.8 129.1 129.4 .2 7.0 1.1 Final products ................................................................ 126.3 127.2 127.2 127.4 .2 6.4 1.4 Consumer goods ....................................................... 136.1 137.3 137.3 137.3 8.5 1.6 Durable goods ..................................................... 141.1 143.3 144.2 144.3 .1 14.0 3.8 Nondurable goods .............................................. 134.0 134.8 134.6 134.5 -.1 6.2 .7 Business equipment ................................................ 134.1 134.8 135.2 135.6 .3 6.5 1.7 Intermediate products ................................................. 134.7 135.0 136.4 136.8 .3 9.4 .6 Construction products ............................................ 128.0 130.1 131.4 131.9 .4 12.9 1.1 Materials .............................................................................. 129.2 131.0 131.6 132.0 .3 15.3 2.9 p Preliminary. e Estimated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A1 Financial and Business Statistics C O N T E N T S INSIDE BACK COVER A32 Federal finance A34 U.S. Government securities Guide to Tabular Presentation A37 Federally sponsored credit agencies Statistical Releases: Reference A38 Security issues A40 Business finance U.S. STATISTICS A42 Real estate credit A2 M em ber bank reserves, Reserve Bank A45 Consumer credit credit, and related items A48 Industrial production A5 Federal funds— M oney market banks A50 Business activity A6 Reserve Bank interest rates A50 Construction A7 Reserve requirements A52 Labor force, employment, and A8 M aximum interest rates; margin unemployment requirements A9 Open market account A53 Consumer prices A10 Federal Reserve Banks A53 W holesale prices A ll Bank debits A54 National product and income A12 M oney stock A56 Flow of funds A13 Bank reserves; bank credit A14 Commercial banks, by classes INTERNATIONAL STATISTICS A18 W eekly reporting banks A58 U.S. balance of payments A23 Business loans of banks A59 Foreign trade A24 Demand deposit ownership A59 U.S. reserve assets A25 Loan sales by banks A60 Gold reserves of central banks and A25 Open market paper governments A26 Interest rates A61 International capital transactions A29 Security markets of the United States A29 Stock market credit A74 Open market rates A30 Savings institutions A75 Central bank rates A75 Foreign exchange rates A82 INDEX TO STATISTICAL TABLES Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A2 BANK RESERVES AND RELATED ITEMS □ AUGUST 1976 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 Loans Float F.R. Total 3 account stand­ Total out­ repur­ assets ing right2 chase agree­ ment Averages of daily figures 1969—Dec............................... 57,500 57,295 205 1,086 3,235 2,204 64,100 10,367 6,841 1970—Dec............................... 61,688 61,310 378 321 3,570 1,032 66,708 11,105 400 7,145 1971—Dec............................... 69,158 68,868 290 107 3,905 982 74,255 10,132 400 7,611 1972—Dec............................... 71,094 70,790 304 1,049 3,479 1,138 76,851 10,410 400 8,293 1973—Dec............................... 79,701 78,833 868 1,298 3,414 1,079 85,642 11,567 400 8,668 1974—Dec............................... 86,679 85,202 1,477 703 2,734 3,129 ,93,967 11,630 400 9,179 1975—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 9,797 Oct................................ 90,476 89,547 929 191 1,945 3,521 96,931 11,599 500 9,877 Nov.............................. 90,934 89,560 1,374 61 2,480 3,481 97,817 11,599 500 10,010 Dec............................... 92,108 91,225 883 127 3,029 3,534 99,651 11,599 500 10,094 1976—Jan................................ 92,998 91,524 1,474 79 2,684 3,505 100,172 11,599 500 10,177 Feb............................... 94,610 92,812 1,798 76 2,375 3,384 101,369 11,599 500 10,267 Mar.............................. 94,880 93,503 1,377 58 2,204 3,412 101,336 11,599 500 10,436 Apr............................... 93,243 92,187 1,056 44 2,236 4,144 100,317 11,599 500 10,501 May............................. 95,967 94,049 1,918 121 2,071 4,051 102,951 11,599 500 10,552 June............................. 95,592 94,289 1,303 120 2,678 4,069 103,106 11,598 530 10,623 July2*............................. 97,105 96,210 895 123 2,752 4,375 104,830 11,598 700 10,652 Week ending— 1976—May 5....................... 97,490 94,289 3,201 30 2,464 4,402 105,278 11,599 500 10,499 12....................... 93,718 93,099 619 55 2,395 4,361 101,105 11,599 500 10,535 19....................... 95,119 93,777 1,342 122 2,377 4,015 102,296 11,599 500 10,541 26....................... 96,984 94,798 2,186 136 1,795 3,737 103,463 11,599 500 10,581 June 2....................... 95,992 93,903 2,089 242 1,962 3,795 102,717 11,598 500 10,580 9....................... 90,962 90,962 93 2,938 3,799 98,214 11,598 500 10,609 16....................... 93,804 93,520 ........284” 49 2,508 4,251 101,056 11,598 500 10,616 23....................... 97,152 95,652 1,500 165 2,535 4,092 104,741 11,598 514 10,634 30....................... 101,294 97,496 3,798 165 2,327 4,150 108,925 11,598 614 10,630 July 7....................... 99,935 97,531 2,404 126 2,461 4,566 107,883 11,598 700 10,641 14....................... 95,804 95,804 176 3,448 4,460 104,239 11.598 700 10,641 21 v..................... 96,359 95,988 371 61 2,703 4,579 104,071 11.598 700 10,656 28*..................... 96,352 95,794 558 159 2,465 4,087 103,418 11,598 700 10,664 End of month 1976—May............................. 97,593 94,334 3,259 397 475 3,888 103,228 11,599 500 10,514 June............................. 101,528 97,380 4,148 314 3,577 4,233 110,679 11,598 700 10,573 July35............................ 97,524 95,316 2,208 46 2,155 3,946 104,327 11,598 700 10,667 Wednesday 1976—May 5....................... 96,440 94,240 2,200 41 3,340 4,537 105,072 11,599 500 10,533 12....................... 96,324 94,136 2,188 258 3,181 4,385 104,866 11,599 500 10,540 19....................... 97,044 93,814 3,230 541 3,027 3,542 105,035 11,599 500 10,548 26....................... 96,885 94,780 2,105 645 2,291 3,820 104,356 11,598 500 10,588 June 2....................... 91,425 91,425 166 2,705 4,002 98,718 11.598 500 10,596 9....................... 90,054 90,054 351 2,856 3,819 97,492 11.598 500 10,609 16....................... 96,142 94,155 1,987 61 3,570 3,965 104,415 11.598 500 10,623“ 23....................... 97,459 96,803 656 837 3,025 4,155 106,174 11,598 600 10,639 30....................... 101,528 97,380 4,148 314 3,577 4,233 110,679 11,598 700 10,573 July 7....................... 98,386 96,985 1,401 71 3,038 4,538 106,593 11,598 700 10,641 14....................... 96,809 96,809 1,013 3,862 4,400 106,427 11.598 700 10,644 1\v..................... 96,286 96,286 129 3,487 4,411 104,653 11.598 700 10,661 28 p..................... 98,125 95,247 2,878 677 2,793 3,941 105,986 11,598 700 10,667 1 Includes Federal agency issues held under repurchase agreements 3 Includes acceptances. For holdings of acceptances on Wed. and endbeginning Dec. 1, 1966, and Federal agency issues bought outright be­ of-month dates, see p. A-10. ginning Sept. 29, 1971. 4 Beginning July 1973, this item includes certain deposits of domestic 2 Includes, beginning 1969, securities loaned—fully guaranteed by U.S. nonmember banks and foreign-owned banking institutions held with Govt, securities pledged with F.R. Banks—and excludes (if any) securities member banks and redeposited in full with F.R. Banks in connection sold and scheduled to be bought back under matched sale-purchase transactions. Notes continued on opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ BANK RESERVES AND RELATED ITEMS A3 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 F.R. Period or date in cash lia­ cir­ hold­ bilities cula­ ings and With Cur­ tion Treas­ For­ Other 4 capital F.R. rency Total 6 ury eign Banks and coin 5 Averages of daily figures 53,591 656 1,194 146 458 2,192 23,071 4,960 28,031 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 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. 78,951 220 1,741 357 874 3,266 29,767 7,174 36,941 ..............................1974—Dec. 81,758 358 2,207 269 711 3,135 27,442 7,213 34,655 ..............................1975—July 81,822 368 818 274 660 3,096 27,183 7,299 34,482 81,907 362 3,415 308 798 3,169 27,215 7,431 34,646 82,215 387 4,940 271 632 3,208 27,254 7,313 34,567 83,740 415 4,333 297 649 3,276 27,215 7,356 34,571 85,810 452 3,955 259 906 3,247 27,215 7,773 34,989 84,625 496 5,903 287 916 3,225 26,995 8,445 35,575 84,002 527 8,811 280 716 3,231 26,168 7,646 33,953 .........................................Feb. 85,014 511 7,653 264 810 3,252 26,366 7,456 33,967 86,565 524 5,211 254 815 3,203 26,345 7,568 34,063 87,389 507 7,215 286 655 3,314 26,236 7,838 34,228 88,547 510 6,778 252 784 3,275 25,711 7,903 33,774 89,420 476 7,404 262 945 3,310 25,964 8,062 34,174 Week ending— 86,745 526 8,910 284 815 3,389 27,208 7,937 35,296 ........................1976—May 5 87,422 522 6,427 327 632 3,136 25,271 8,297 33,720 ..............................................12 87,502 514 6,473 300 568 3,234 26,346 7,638 34,136 ..............................................19 87,402 493 8,055 232 624 3,409 25,927 7,513 33,597 ..............................................26 87,890 488 6,777 275 716 3,416 25,834 7,833 33,825 88,601 503 2,951 255 669 3,056 24,885 8,082 33,127 88,765 507 4,050 261 1,031 3,187 25,970 7,841 33,971 ..............................................16 88,527 513 8,348 243 723 3,333 25,801 7,633 33,594 ..............................................23 88,358 511 11,788 251 699 3,535 26,629 8,077 34,866 ..............................................30 89,231 510 10,415 257 1,025 3,232 26,153 8,220 34,521 ...................................July 7 89,971 476 7,121 255 772 3,212 25,370 8,400 33,919 ..............................................14 89,582 443 5,622 282 945 3,286 26,867 7,428 34,443 89,033 500 6,218 250 1,043 3,427 25,909 8,145 34,202 ..............................................2Sp End of month 87,657 505 6,745 303 679 3,500 26,457 7,833 34,447 88,878 480 11,972 349 847 3,564 27,460 8,077 35,697 88,968 500 8,739 295 953 3,525 24,313 8,191 32,652 .........................................July21 Wednesday 87,289 513 6,046 298 795 3,061 29,702 7,937 37,791 87,818 510 5,795 332 588 3,207 29,255 8,297 37,704 ..............................................12 87,611 493 7,861 230 518 3,336 27,632 7,638 35,422 ..............................................19 87,782 480 7,655 251 941 3,435 26,498 7,513 34,168 ..............................................26 88,520 513 6,128 235 849 3,002 22,165 7,833 30,157 88,987 495 2,496 238 637 3,112 24,234 8,082 32,476 ................................................9 88,896 510 5,763 235 787 3,273 27,672 7,841 35,673 ..............................................16 88,594 507 11,052 254 740 3,378 24,485 7,633 32,278 ..............................................23 88,878 480 11,972 349 847 3,564 27,460 8,077 35,697 90,014 492 7,478 260 800 3,134 27,354 8,220 35,722 ...................................July 7 90,120 446 6,987 234 743 3,246 27,593 8,400 36,142 89,529 431 5,042 277 1,142 3,309 27,882 7,428 35,458 89,230 500 6,320 227 1,134 3,523 28,018 8,145 36,311 with voluntary participation by nonmember institutions in the F.R. Sys­ reserve deficiencies on which F.R. Banks were allowed to waive penalties tem’s program of credit restraint. for transition period associated with bank adaptation to Regulation J, As of Dec. 12, 1974, the amount of voluntary nonmember bank and as amended effective Nov. 9, 1972. For 1973, allowable deficiencies in­ foreign-agency and branch deposits at F.R. Banks that are associated cluded are (beginning with first statement week of quarter): Ql, $279 with marginal reserves are no longer reported. However, two amounts are million; Q2, $172 million; Q3, $112 million; Q4, $84 million. For 1974, reported: (1) deposits voluntarily held as reserves by agencies and branches Ql, $67 million, Q2, $58 million. Transition period ended after 1974, Q2. of foreign banks operating in the United States; and (2) Euro-dollar Beginning with week ending Nov. 19, 1975, adjusted to include waivers liabilities. of penalties for reserve deficiencies in accordance with Board policy, 5 Part allowed as reserves Dec. 1, 1959—Nov. 23, 1960; all allowed effective Nov. 19, 1975, of permitting transitional relief on a graduated thereafter. Beginning Jan. 1963, figures are estimated except weekly basis over a 24-month period when a nonmember bank merges into an averages. Beginning Sept. 12, 1968, amount is based on close-of-business existing member bank, or when a nonmember bank joins the Federal figures for reserve period 2 weeks previous to report date. Reserve System. 6 Beginning with week ending Nov. 15, 1972, includes $450 million of For other notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AND RELATED ITEMS □ AUGUST 1976 RESERVES AND BORROWINGS OF MEMBER BANKS (In millions of dollars) All member baiiks Large banks2 Reserves Borrowings New York City City of Chicago Other Total Re­ Excess1 Total Sea­ Excess Borrow­ Excess Borrow­ Excess Borrow­ cess held1 quired sonal ings ings ings 22,719 22,267 452 454 41 111 15 23 67 228 330 25,260 24,915 345 238 18 40 8 13 50 105 267 27,221 26,766 455 765 100 230 15 85 90 270 250 28,031 27,774 257 1,086 56 259 18 27 6 479 177 29,265 28,993 272 321 34 25 7 4 42 264 189 31,329 31,164 165 107 25 35 1 8 -35 22 174 31,353 31,134 219 1,049 -20 301 13 55 -42 429 160 35,068 34,806 262 1,298 41 -23 74 43 28 28 761 133 36,941 36,602 339 703 32 132 80 5 18 39 323 163 34,655 34,687 -32 261 17 -22 54 -24 23 -118 62 132 34,482 34,265 217 211 38 -18 14 5 1 98 51 132 34,646 34,447 199 396 61 17 68 27 2 23 141 132 34,567 34,411 156 191 65 42 31 -23 3 32 134 34,571 34,281 290 61 28 50 7 34 42 5 164 34,989 34,727 262 127 13 64 63 -18 89 26 127 35,575 35,366 209 79 9 52 9 -18 17 3 13 172 33,953 33,939 14 76 11 -147 20 -14 1 -2 16 177 33,967 33,531 436 58 8 177 21 36 2 108 14 115 34,063 33,974 89 44 11 2 -4 8 -47 15 138 34,228 33,846 382 121 11 13 29 -69 2 297 33 141 33,774 33,657 117 120 20 22 26 91 7 -125 22 129 34,174 34,081 93 123 25 -79 37 -37 13 -209 11 112 35,481 35,085 396 871 15 57 189 39 117 468 183 34,612 34,479 133 222 13 18 -20 -20 90 155 34,864 34,791 73 202 15 -72 ........78’ 2 54 6 16 137 34,898 34,695 203 382 19 107 151 9 50 -13 57 100 34,999 34,718 281 253 23 82 15 67 91 117 35,551 35,227 324 67 10 59 -12 102 11 175 35,802 35,639 163 45 8 71 -2 -94 2 188 36,193 35,996 197 153 10 -62 28 -2 77 91 18 170 35,072 34,907 165 58 8 49 10 28 -23 15 111 35,069 34,652 417 57 12 94 -14 139 16 198 33,779 33,729 50 51 12 -83 20 -31 14 144 34,540 34,040 500 56 10 180 -7 4 95 10 232 33,656 33,773 -117 148 10 -157 82 -5 -43 24 88 34,088 33,678 410 85 8 98 31 11 11 122 14 179 33,379 33,276 103 48 8 53 26 -18 -67 3 135 33,710 33,509 201 40 8 26 21 13 22 141 33,562 33,451 111 78 8 -27 36 -13 70 23 81 34,236 33,838 398 36 10 105 10 109 14 174 33,587 33,464 123 24 11 — 13 — 16 17 4 135 33,762 33,589 173 61 10 29 8 15 -15 32 151 34,447 34,317 130 40 10 -4 -22 18 41 2 115 34,384 34,272 112 54 11 16 27 —43 26 112 35,296 34,855 441 30 11 65 3 6 216 154 33,720 33,753 -33 55 9 -43 34 3 3 -112 2 119 34,136 33,891 245 122 11 40 40 -14 6 80 34 139 33,597 33,519 78 136 12 -53 53 30 10 32 91 33,825 33,372 453 242 17 60 -15 14 244 79 164 33,127 33,197 -70 93 14 -42 36 -13 17 -153 5 138 33,971 33 400 571 49 16 118 68 210 11 175 33*594 33^774 -180 165 21 -106 62 -30 -134 45 90 34,866 34,341 525 165 28 95 14 37 213 24 180 34,521 33,959 562 126 26 317 21 50 22 1 173 33,919 33,890 29 176 23 -93 78 -28 57 24 3 126 34 443 34,198 245 61 24 26 -20 — 137 11 71 34’,202 34,200 2 159 27 -233 63 -11 -171 33 81 k ending Nov. 15, 1972, includes $450 million of existing member bank, or when a nonmember bank is the /vhich F.R. Banks are allowed to waive penalties Reserve System. i connection with bank adaptation to Regulation J 2 Beginning Nov. 9, 1972, designation of banks as rve ci1 >v. 9, 1972. Beginning 1973, allowable deficiencies for reserve-requirement purposes has been based on of bi with first statement week of quarter): Ql, $279 demand deposits of more than $400 million), as describ i the E >n; Q3, $112 million; Q4, $84 million. Beginning for July 1972, p. 626. Categories shown here as “Largt id “A] Q2, $58 million. Transition period ended after parallel the previous “Reserve city” and “Country” cate zs, res] Dr weeks for which figures are preliminary, figures (hence the series are continuous over time). add to the total because adjusted data by class are Note.—Monthly and weekly data are averages of d ending Nov. 19, 1975, adjusted to include waivers the month or week, respectively. ; deficiencies in accordance with Board policy, Borrowings at F. R. Banks: Based on closing figures. , of permitting transitional relief on a graduated Effective Apr. 19, 1973, the Board’s Regulation A, w period when a nonmember bank merges into an ing by F.R. Banks, was revised to assist smaller mem the seasonal borrowing needs of their communities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ MONEY MARKET BANKS A5 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 surplus, or Less— deficit (—) Gross transactions Net transactions Reporting banks and Total Bor­ week ending— Excess Net Per cent two-way Pur­ Loans row­ Net re­ Bor­ inter­ of Pur­ trans­ chases Sales to ings loans serves 1 rowings bank Amount avg. chases Sales actions2 of net of net dealers3 from at F.R. Federal required buying selling dealers4 Banks funds reserves banks banks trans. Total—46 banks 1976—June 2. 201 59 10,982 -10,840 73.7 18,849 7,867 5,099 13,749 2,768 2,522 1,291 1,231 9. 42 15,799 -15,951 108.6 20,721 4,921 4,011 16,710 910 3,729 1,484 2,245 16. .............. 14,728 -14,478 97.8 21,071 6,343 4,168 16,903 2,175 3,662 1,072 2,590 23. 96 13,126 -13,261 89.4 19,373 6,247 4,529 14,843 1,718 2,047 941 1,106 30. 19 10,233 -10,063 66.2 17,914 7,681 4,796 13,118 2,886 1,917 1,249 668 July 7. 21 13,296 -12,766 85.5 20,637 7,341 4,668 15,969 2,673 2,448 997 1,451 14. 135 16,941 -17,059 112.8 22,289 5,348 4,043 18,247 1,305 3,260 606 2,654 21. 9 13,692 -13,641 90.0 20,241 6,549 4,472 15,769 2,077 2,549 935 1,614 28. 66 12,617 -12,680 84.8 18,938 6,321 4,227 14,711 2,094 2,259 1,327 933 8 in New York City 1976—June 2. 3,267 -3,235 54.5 4,484 1,217 1,183 3,301 34 1,399 261 1,138 9. 36 5,317 -5,370 89.8 5,869 552 552 5,317 1,713 281 1,432 16. 5,018 -4,916 83.1 5,612 594 594 5,018 2,219 211 2 008 23. 60 3,618 -3,701 62.8 4,629 1,012 1,012 3,618 1,293 229 1,064 30. 14 3,194 -3,154 51.6 4,385 1,190 1,106 3,279 85 1,283 193 1,091 July 7. I 21 5,414 -5,006 84.0 6,105 691 691 5,414 1,684 357 1,327 14. 78 5,881 -5,958 98.4 6,172 291 291 5,881 1,884 272 1,612 21. 3,985 -3,917 65.5 4,873 888 695 4,178 193 1,665 378 1,287 28. -53 57 3,695 -3,805 64.3 4,513 819 819 3,695 1,474 207 1,268 38 outside New York City 1976—June 2.......... 169 59 7,715 -7,605 86.8 14,365 6,650 3,917 10,448 2,734 1,123 1,030 93 9.......... -92 6 10,482 -10,581 121.6 14,852 4,369 3,459 11,393 910 2,017 1,203 813 16.......... 149 9,710 -9,561 107.6 15,459 5,749 3,574 11,885 2,175 1,442 861 582 23.......... -15 36 9,508 -9,559 106.9 14,744 5,236 3,518 11,226 1,718 754 713 42 30.......... 134 4 7,038 -6,908 76.0 13,529 6,491 3,690 9,840 2,801 634 1,057 -423 July 7.......... 122 7,882 -7,760 86.6 14,532 6,650 3,977 10,555 2,673 764 640 124 14.......... 17 57 11,060 -11,101 122.4 16,117 5,057 3,752 12,366 1,305 1,376 335 1,041 21.......... -8 9 9,706 -9,724 106.0 15,368 5,662 3,777 11,591 1,884 883 557 327 28.......... 56 9 8,922 -8,875 98.2 14,425 5,503 3,409 11,016 2,094 785 1,120 -335 5 in City of Chicago 1976—June 2.......... 9 14 4,167 -4,172 277.5 4,943 775 775 4,167 366 525 -159 9.......... -13 4 5,065 -5,081 333.7 5,622 557 557 5,064 591 436 155 16.......... 66 5,156 -5,090 317.6 5,779 623 623 5,156 585 470 115 23.......... -4 4,935 -4,939 315.4 5,586 651 643 4,943 9 331 347 -16 30.......... 32 4,020 -3,988 248.0 4,962 942 918 4,045 24 170 445 -275 July 7.......... 75 4,711 -4,636 297.1 5,557 845 825 4,732 21 272 233 40 14.......... -17 57 5,935 -6,008 370.3 6,469 535 534 5,935 368 33 335 21.......... 20 5,789 -5,769 350.0 6,541 753 753 5,789 355 227 128 28.......... 5,411 -5,403 353.0 6,038 627 627 5,411 304 501 — 197 33 others 1976—June 2.......... 160 45 3,547 -3,433 47.3 9,422 5,875 3,141 6,281 2,734 757 505 252 9.......... -79 3 5,418 -5,500 76.6 9,230 3,812 2,902 6,329 910 1,426 767 659 16.......... 82 4,554 -4,472 61.4 9,680 5,127 2,951 6,729 2,175 857 390 467 23.......... -11 36 4,573 -4,620 62.6 9,157 4,584 2,875 6,282 1,709 423 365 57 30.......... 102 4 3,018 -2,920 39.0 8,567 5,549 2,772 5,795 2,777 464 612 -148 July 7.......... 48 3,171 -3,123 42.2 8,976 5,805 3,152 5,823 2,652 492 408 84 14.......... 33 5,126 -5,092 68.4 9,648 4,522 3,217 6,431 1,305 1,008 301 707 21.......... -28 9 3,918 -3,955 52.6 8,827 4,909 3,025 5,802 1,884 529 330 199 28.......... 48 9 3,511 -3,472 46.3 8,387 4,875 2,781 5,605 2,094 481 619 -138 1 Based 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. Beginning with week ending Jan. 7, 1976, adjusted to clearing banks, reverse repurchase agreements (sales of securities to include waivers of penalties for reserve deficiencies in accordance with dealers subject to repurchase), resale agreements, and borrowings secured Board policy change effective Nov. 19, 1975. by Govt, or other issues. 2 Derived from averages for individual banks for entire week. Figure Note.—Weekly averages of daily figures. For description of series for each bank indicates extent to which the bank’s weekly average pur­ and back data, see Aug. 1964 Bulletin, pp. 944-74. Revised data for chases and sales are offsetting. Jan. 1976 may be obtained from the Public Information Office, Office of 3 Federal funds loaned, net funds supplied to each dealer by clearing the Secretary, Board of Governors of the Federal Reserve System, Wash­ ington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A6 F.R. BANK INTEREST RATES □ AUGUST 1976 CURRENT RATES (Per cent per annum) Loans to member banks— Under Sec. 10(b) 2 Loans to all others under Under Secs. 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 7/31/76 date rate 7/31/76 date rate 7/31/76 date3 rate 7/31/76 date rate Boston................... 5% 1/19/76 6 6 1/19/76 6Vi 6Vi 1/19/76 7 81/i 1/19/76 9 New York.............. 5i/i 1/19/76 6 6 1/19/76 6Vi 6Vi 1/19/76 7 81/i 1/19/76 9 Philadelphia.......... 5i/i 1/19/76 6 6 1/19/76 6i/i 6i/i 1/19/76 7 8i/i 1/19/76 9 Cleveland.............. 5Vi 1/19/76 6 6 1/19/76 6Vi 6Vi 1/19/76 7 81/2 1/19/76 9 Richmond............. 5i/i 1/19/76 6 6 1/19/76 6i/i 61/2 1/19/76 7 8Vi 1/19/76 9 Atlanta.................. 5i/i 1/19/76 6 6 1/19/76 6% 6i/i 1/19/76 7 8Vi 1/19/76 9 Chicago................. 5i/i 1/19/76 6 6 1/19/76 6i/i 6Vi 1/19/76 7 8i/i 1/19/76 9 5i/i 1/23/76 6 6 1/23/76 6Vi 6Vi 1/23/76 7 8 Vi 1/23/76 9 Minneapolis.......... 5i/i 1/19/76 6 6 1/19/76 6Vi 6i/i 1/19/76 7 8 Vi 1/19/76 9 Kansas City.......... 5Vi 1/19/76 6 6 1/19/76 6Vi 6i/i 1/19/76 7 8 Vi 1/19/76 9 Dallas.................... 5Vi 1/19/76 6 6 1/19/76 6Vi 6i/i 1/19/76 7 8 Vi 1/19/76 9 San Francisco........ 5% 1/19/76 6 6 1/19/76 6Vi 6Vi 1/19/76 7 8 Vi 1/19/76 9 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 13 rate. agency thereof. SUMMARY OF EARLIER CHANGES (Per cent per annum) Range F.R. Range F.R. Range F.R. Effective (or level)— Bank Effective (or level)— Bank Effective (or level)— Bank date All F.R. of date All F.R. of date All F.R. of Banks N.Y. Banks N.Y. Banks N.Y. In effect Dec. 31, 1955 21/z 21/2 1964—Nov. 24, 31/2-4 4 1971—Nov. 11................... 434-5 5 30, 4 4 19................... 434 434 1956—Apr. 13............ 2Vi-3 2V4 Dec. 13................... 41/2-434 434 20............ 2%-3 2*4 1965—Dec. 6, 4 -4i/i 4Vi 41/2-434 41/i Aug. 24............ 2%-3 3 13, 41/2 41/2 4Vi 41/2 31............ 3 3 1967—Apr. 7, 4 >41/2 4 1973—Jan. 15................... 5 5 1957— N A o ug v . . 2 1 9 5 . 3 . . . . . . . . . . . . . . . . . . . . . . . 3 3 31 - - 3 3 /2 1 1 / / 2 z 3 f 4 Nov. 2 2 1 0 7 4 . , , 4 4 4 - ^ 41/2 4 4 41 V /2 i A M Fe p a b r r . . . 5 5 V 5 i 1 - - / 5 5 2 % Vi 5 5 5 V 1 V / i i i Dec. 2............ 3 3 1968—Mar. 15, 4Vi-5 414 May 534 534 22, 5 5 534-6 6 1958—Jan. 22............ 234-3 3 Apr. 19. 5 -5Vi 51/2 18................... 6 6 2 4 2V4-3 2% 26. 5Vi 5Vi June 11................... 6 -6 Vi 6 Vi Mar. 7............ 214-3 21/4 Aug. 16, 51/4-5^ 5Vi 15................... 6 Vi 6 Vi 1 3 2%-2% 21/4 30. 5i/4 51/4 July 2................... 7 7 21............ 21/4 214 Dec. 18. 514-51/2 51/2 Aug. 14................... 7 -7 Vi 7Vi A M p a r y . 1 9 8. . . . . . . . . . . . . . . . . . . . . . . . l% 1 - % 2% l 1% 3/4 20. 51/2 5i/i 23................... 7Vi 7Vi A Se u p g t . . 1 1 2 5. . . . . . . . . . . . . . . . . . . . . . . . I 1 V V a 4 - - 2 2 2l3/4 1969—Apr. 4 8 , . 51/ 6 2-6 6 6 1974—Apr. 25................... 7 V 8 i-8 8 8 23............ 2 2 Dec. 734-8 734 Oct. 24............ 2 -2% 2 1970—Nov. 11, 534-6 6 734 734 Nov. 7............ 21/2 21/2 13. 534-6 53/4 16. 534 53/4 1975—Jan. 714-734 1959—Mar. 6............ 21/2-3 3 Dec. 1, 51/2-534 534 10................... 7V4-734 714 16............ 3 3 4. 5i/i-534 51/2 24................... 71/4 71/4 May 29............ 3 -3i/2 3i/i 11. 51/2 51/2 Feb. 5................... 634-714 634 June 12............ 31/2 3Vi 7................... 634 Sept. 11............ 31/2-4 4 1971—Jan. 8. 514-51/i 51/4 Mar. 10.................. 61/4-634 614 18............ 4 4 15, 514 51/4 14................... 614 61/4 1960—June 10 3 . . . . . . . . . . . . . . . . . . . . . . . . 3 3 1 V /2 i- - 4 4 4 31/i 2 2 1 2 9 9 . . . 5 5 5 - - 5 5 1 14 4 5 5 5 1/4 May 2 1 3 6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 6 -61/4 6 6 S A e u p g t . . 1 1 9 2 . . 4 . . . . . . . . . . . . . . . . . . . . . . 3 3 3 - i/ 3 i % 3 3 3 Vi J F u e l b y . 1 1 1 9 6 3 , , , 4 4 3 3 4 4 4 3 - - 5 5 4 5 4 5 34 1976—Jan. 2 1 3 9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5V 5 i~ V 6 i 5 5 V V i i 1963—July 17............ 3 -3% 3Vi 23 5 5 In effect, July 31, 1976.... 5i/i 5Vi 26............ 3Vi 31/2 Note.—Rates under Secs. 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

AUGUST 1976 □ RESERVE REQUIREMENTS A7 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) Effective date 1 Reserve city Other Other time Savings 0-5 Over 5 0-5 Over 5 0-5 Over 5 In effect Jan. 1, 1963.............. 16% 12 4 1966—July 14,21.......... 4 4 5 Sept. 8,15.......... 6 1967—Mar. 2............... * 3% Mar. 16.............. 2 3 1968—Jan. 11,18.......... 16% 17 12 12% 1969—Apr. 17.............. 17 17% 12% 13 1970—Oct. 1................. 5 Beginning Nov. 9, 1972 Net demand2,4 Time3 Other time Effective date 0-5, maturing in— Over 5 5, maturing in— 0-2 2-10 10-100 100- Over Savings 400 400 180 180 30-179 days to 4 years 30-179 days to 4 years days 4 years or more days 4 years or more 1972—Nov. 9..................... 8 10 12 6 16% 17% 73 73 75 Nov. 16................... 13 1973 July 19..................... 10% 12% 13% 18 1974—Dec. 12................... 17% 6 I 1975—Feb. 13................... 7% 10 12 13 16% Oct. 30.................... 3[ 8 1 3 8 1 1976—Jan. 8....................... 3 8 2% 82% In effect July 31, 1976.... 7% 10 12 13 16% 3 3 8 2% 8 1 6 8 2% 8 1 Presen t 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 banks 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 sup­ computed 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% 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 of 1975 action, 8 The average of reserves on savings and other time deposits must be see Regulations D and Q, and also Bulletins for Oct. 1975, p. 708, and at least 3 per cent, the minimum specified by law. For details, see Regu­ Nov. 1975, p. 769. lation D. Notes 2(b) and 2(c) above are also relevant to time deposits. 4 Effective Nov. 9, 1972, a new criterion was adopted to designate re­ Note.—Required reserves must be held in the form of deposits with serve cities, and on the same date requirements for reserves against net F.R. Banks or vault cash. demand deposits of member banks were restructured to provide that each Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 MAXIMUM INTEREST RATES; MARGIN REQUIREMENTS □ AUGUST 1976 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............., 4% Savings deposits..................... Other time deposits:1 Other time deposits (multiple- Multiple maturity:2 and single-maturity):1, 2 30-89 days.......... 4 4% Less than $100,000: 90 days to 1 year. 5 30-89 days...................... 5 5 5 2 1 - y 2 e a y r e s a o r r s . m .... o .. r .. e .. . . .. 5 5 5% % 9 1 0 -2 d % ay y s e t a o r s 1 . . y ... e .. a .. r . . . . . . . . . . . . . . . . . . . . . . . . 6 5 % 6 5 % 5 6 % & Single-maturity: 2% years or more.......... 6% 6% 6% 6% Less than $100,000: Minimum denomination 30 days to 1 year. 5 of $1,000:4 2 1 - y 2 e a y rs e a o r r s . m .... o .. r . e ... . . . 5% 5 5 % % 4 6 - y 6 e y ar e s a r o s r . . m .... o .. r .. e .. . . . . . . . . . . . . . . . . . . . (5) m 7 7 % % $100,000 or more: Governmental units....... (6) (6> 7% m 30-59 days.......... 5% (3) $100,000 or more.............. (3) (3> (3) (3> 60-89 days.......... 5*4 (3) 90-179 days......... 5% 6 (3) 1 1 8 y 0 e d ar a y o s r t m o o 1 r y e e . a .. r 6V4 ( ( 3 3 ) ) 1 For exceptions with respect to certain foreign time deposits, see 5 per cent of its total time and savings deposits. Sales in excess of that Bulletin for Feb. 1968, p. 167. amount were subject to the 6% per cent ceiling that applies to time de­ 2 Multiple-maturity time deposits include deposits that are automati­ posits maturing in 2% years or more. cally renewable at maturity without action by the depositor and deposits Effective Nov. 1, 1973, a ceiling rate of ll/4 per cent was imposed on that are payable after written notice of withdrawal. certificates maturing in 4 years or more with minimum denominations 3 Maximum rates on all single-maturity time deposits in denominations of $1,000. There is no limitation on the amount of these certificates that of $100,000 or more have been suspended. Rates that were effective banks may issue. Jan. 21, 1970, and the dates when they were suspended are: 6 Prior to Nov. 27, 1974, no distinction was made between the time deposits of governmental units and of other holders, insofar as Regula­ 30-59 days 614 per centl June 24, 1970 tion Q ceilings on rates payable were concerned. Effective Nov. 27, 1974, 60-89 days 6Vi per cent/ governmental units were permitted to hold savings deposits and could 90-179 days 6Y4 per cent] receive interest rates on time deposits with denominations under $100,000, 180 days to 1 year 7 per cent [ May 16, 1973 irrespective of maturity, as high as the maximum rate permitted on such 1 year or more 7% per centj deposits at any Federally insured depositary institution. Rates on multiple-maturity time deposits in denominations of $100,000 Note.—Maximum rates that may be paid by member banks are estab­ or more were suspended July 16, 1973, when the distinction between lished by the Board of Governors under provisions of Regulation Q; single- and multiple-maturing deposits was eliminated. however, a member bank may not pay a rate in excess of the maximum 4 Effective Dec. 4, 1975, the $1,000 minimum denomination does not rate payable by State banks or trust companies on like deposits under apply to time deposits representing funds contributed to an Individual the laws of the State in which the member bank is located. Beginning Retirement Account established pursuant to 26 U.S.C. (I.R.C. 1954) §408. Feb. 1, 1936, maximum rates that may be paid by nonmember insured 5 Between July 1 and Oct. 31, 1973, there was no ceiling for certificates commercial banks, as established by the FDIC, have been the same as maturing in 4 years or more with minimum denominations of $1,000. those in effect for member banks. The amount of such certificates that a bank could issue was limited to 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 1970—May 5 80 60 80 1970—May 6 1971—Dec. 3 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

AUGUST 1976 □ OPEN MARKET ACCOUNT A9 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., 11,074 5,214 2,160 99 -3,483 848 5,430 249 -1,845 93 -102 1971., 8,896 3,642 1,064 1,036 -6,462 1,338 4,672 933 685 311 150 1972., 8,522 6,467 2,545 125 2,933 789 -1,405 539 -2,094 167 250 1973. 15,517 4,880 3,405 1,396 -140 579 -2,028 500 895 129 87 1974. 11,660 5,830 4,550 450 -1,314 797 -697 434 1,675 196 205 1975. 11,562 5,599 6,431 3,886 -3,553 2,863 4,275 1,510 -4,697 1,070 848 1975—June. 421 161 612 20 691 488 -529 180 109 July.. 1,505 800 Aug.. 312 282 400 2,002 -2,144 150 1,299 64 -1,444 47 300 Sept.. 2,118 200 278 562 -278 137 124 Oct... 1,263 ’*766 400 48 -48 Nov.. 983 652 919 43 -265 267 -135 155 300 244 ioo Dec.. 1,984 200 31 28 118 -28 78 71 1976—Jan... 243 1,239 600 37 110 100 73 Feb.. 1,664 389 40 -1,153 177 174 63 968 59 200 Mar.. 1,069 511 600 38 349 185 107 -349 63 24 Apr.. 2,869 1,355 1,000 27 72 249 70 -72 51 38 May. 1,335 1,224 403 2,602 -3,105 418 "85 June. 2,719 524 350 83 -449 617 449 195 96 Matched sale-purchase Repurchase Federal agency obligations Bankers Total outright1 transactions agreements Net acceptances, (U.S. Govt, (U.S. Govt, change net securities) securities) in U.S. Outright Repur­ Net Period Govt, chase change • securi­ agree­ Repur­ Gross Gross Gross ties Gross Sales or ments, chase pur­ Gross Redemp­ Gross pur­ pur­ Gross pur­ redemp­ net Out­ agree­ chases 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 6,149 197 5 20,892 5,599 9,559 151,205 152,132 140,311 139,538 7,434 1,616 246 -392 163 -35 8,539 1975—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 -1 156 1,222 Sept... 2,940 200 19,931 19,835 16,664 14,857 4,451 394 1 203 14 94 5,155 Oct... 1,263 766 400 15,886 16,113 13,699 13,838 186 284 -124 49 50 445 Nov. . 1,693 652 919 14,442 15,207 14,342 17,275 -2,047 -169 -21 -300 -2,537 Dec... 2,281 200 10,559 10,058 8,464 7,247 2,797 118 15 385 3,315 1976—Jan.. . 563 1,239 600 11,407 11,503 18,135 14,919 2,037 239 187 5 98 2,567 Feb... 2,003 200 7,551 7,957 17,753 20,943 -982 297 -236 -70 -109 -1,101 Mar. . 1,380 618 600 12,697 12,082 16,000 14,783 763 217 -138 -31 812 Apr... 3,233 1,425 1,000 15,138 14,899 17,456 15,963 2,061 -155 -50 162 2,019 May.. 1,335 1,224 403 12,417 12,355 20,355 21,203 -1,202 20 22 -51 -69 -1,080 June.. 3,709 524 350 20,973 21.205 14,409 13,643 3,834 -22 123 -78 229 4,086 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 directly from the Federal Reserve, as follows (millions of dollars): June Note.—Sales, redemptions, and negative figures reduce System hold­ 1971, 955; Sept. 1972, 38; Aug. 1973, 351; Sept. 1973, 836; Nov. 1974, ings; all other figures increase such holdings. Details may not add to 131; Mar. 1975, 1,560; Aug. 1975, 1,989. totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 FEDERAL RESERVE BANKS a AUGUST 1976 CONSOLIDATED STATEMENT OF CONDITION OF ALL FEDERAL RESERVE BANKS (In millions of dollars) Wednesday End of month Item 1976 1976 1975 July 28 July 21 July 14 July 7 June 30 July 31 June 30 July 31 Gold certificate account................................ 11,598 11,598 11,598 11,598 11,598 11,598 11,598 11,620 Special Drawing Rights certificate account. 700 700 700 700 700 700 700 500 Cash...................................................... 347 347 320 336 339 361 339 338 Loans: Member bank borrowings............... 677 129 1,013 71 314 46 314 177 Other................................................ Acceptances: Bought outright............................... 333 340 343 351 361 330 361 685 Held under repurchase agreements. 117 209 666 326 666 Federal agency obligations: Bought outright................................ 6,805 6,805 6,805 6,805 6,805 6,805 6,805 5,083 Held under repurchase agreements. 140 277 46 277 U.S. Govt, securities: Bought outright: Bills........................... 36,596 37,635 38,158 38,334 38,729 36,665 38,729 34,475 Certificates—Special. Other.. Notes......................... 45,749 45,749 45,749 45,749 45,749 45,749 45,749 42,886 Bonds....................... 6,097 6,097 6,097 6,097 6,097 6,097 6,097 4,522 Total bought outright1.................... 88,442 89,481 90,004 90,180 90,575 88,511 90,575 81,883 Held under repurchase agreements. 2,738 1,401 3,871 2,162 3,871 Total U.S. Govt, securities. 91,180 89,481 90,004 91,581 94,446 90,673 94,446 81,883 99,252 96,755 98,165 99,017 102,869 98,226 102,869 87,828 Total loans and securities................... Cash items in process of collection... *7,828 *9,156 9,533 9,609 9,044 *6,116 9,044 5,922 Bank premises..................................... 348 347 345 345 346 347 346 300 Operating equipment........................... 18 18 18 18 18 18 18 2 Other assets: Denominated in foreign currencies. 663 1,155 1,165 1,182 1,165 664 1,165 1 All other........................................... 2,912 2,891 2,872 2,993 2,704 2,917 2,704 2,893 Total assets. *123,666 *122,967 124,716 125,798 128,783 p120,947 128,783 109,404 Liabilities F.R. notes.......................................... 79,409 79,646 80,242 80,201 79,124 79,161 79,124 72,392 Deposits: Member bank reserves.................. *28,018 *27,882 27,593 27,354 27,460 *24,313 27,460 25,740 U.S. Treasury—General account. 6,320 5,042 6,987 7,478 11,972 8,739 11,972 2,675 Foreign........................................... 227 277 234 260 349 295 349 369 Other: All other 2................................. 1,134 1,142 743 800 847 953 847 686 Total deposits. *35,699 *34,343 35,557 35,892 40,628 *34,300 40,628 29,470 Deferred availability cash items........... 5,035 5,669 5,671 6,571 5,467 3,961 5,467 4,188 Other liabilities and accrued dividends. 1,149 1,044 1,098 1,100 1,159 1,103 1,159 1,068 Total liabilities....................................... *121,292 *120,702 122,568 123,764 126,378 *118,525 126,378 107,118 Capital accounts Capital paid in.......................................................... 960 960 959 959 959 959 959 911 Surplus....................................................................... 929 929 929 929 929 929 929 897 Other capital accounts............................................. 485 376 260 146 517 534 517 478 Total liabilities and capital accounts...................... *123,666 *122,967 124,716 125,798 128,783 *120,947 128,783 109,404 Marketable U.S. Govt, securities held in custody for foreign and international accounts....................... 46,408 46,494 44,845 44,806 45,187 46,648 45,187 42,124 Federal Reserve Notes—Federal Reserve Agents’ Accounts F.R. notes outstanding (issued to Bank)...................... 84,984 84,920 84,619 84,263 83,987 85,165 83,987 78,070 Collateral held against notes outstanding: Gold certificate account.............................................. 11,596 11,596 11,595 11,596 11,596 11,596 11,596 11,596 Special Drawing Rights certificate account.............. 394 384 384 384 365 394 365 302 Acceptances................................................................. 74,630 74,380 74,105 73,710 73,710 74,630 73,710 69,030 86,620 86,360 86,084 85,690 85,671 86,620 85,671 80,928 1 See note 2 on p. A-2. 2 See note 4 on p. A-2. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ FEDERAL RESERVE BANKS; BANK DEBITS All MATURITY DISTRIBUTION OF LOANS AND U.S. GOVERNMENT SECURITIES HELD BY FEDERAL RESERVE BANKS (In millions of dollars) Wednesday End of month Item 1976 1976 1975 July 28 July £1 July 14 July 7 June 30 July 31 June 30 July 31 677 129 1,012 70 316 46 316 178 677 126 1,004 61 311 38 311 162 16 90 days...................................................... 3 8 9 5 8 5 16 91 days to 1 year......................................................... 450 340 343 560 1,027 656 1,027 685 164 33 11 236 699 386 699 99 216 230 225 213 200 206 200 403 70 77 107 111 128 64 128 183 91,180 89,481 90,004 91,581 94,446 90,673 94,446 81,883 6,133 4,655 4,789 4,898 7,569 4,405 7,569 5,294 18,439 18,722 17,681 18,814 18,650 19,837 18,650 15,760 25,137 24,633 26,063 26,398 26,756 24,960 26,756 22,130 1-5 years...................................................................... 28,531 28,531 28,531 28,531 28,531 28,531 28,531 28,366 8,283 8,283 8,283 8,283 8,283 8,283 8,283 7,137 4,657 4,657 4,657 4,657 4,657 4,657 4,657 3,196 6,945 6,805 6,805 6,805 7,082 6,851 7,082 5,083 Within 15 days*.......................................................... 182 43 29 29 303 88 303 27 309 267 310 310 307 309 307 276 919 960 908 908 914 919 914 531 1-5 years...................................................................... 3,374 3,374 3,374 3,374 3,374 3,374 3,374 2,544 1,468 1,468 1,491 1,491 1,491 1,468 1,491 1,187 693 693 693 693 693 693 693 518 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 NN.Y.Y.). S6M oSthAe’rss2 SMSA’s N.Y. 6 others2 N.Y.) SMSA’s 1975—June.............................. 22,503.5 10,612.2 4,756.7 11,891.3 7,134.6 124.4 328.6 114.2 80.0 66.7 July.............................. 22,827.9 10,709.5 4,841.1 12,118.3 7,277.2 126.2 331.0 115.7 81.6 68.2 Aug.............................. 23,269.4 10,628.8 5,125.1 12,640.5 7,515.4 130.4 335.0 124.4 86.2 71.2 Sept.............................. 23,181.9 10,585.0 5,153.0 12,596.9 7,443.8 128.8 330.7 123.8 85.1 70.0 Oct............................... 24,137.1 11,801.5 4,921.3 12,335.6 7,414.3 134.0 364.0 118.7 83.5 69.8 24,067.7 11,529.9 4,937.3 12,537.8 7,600.5 134.0 360.8 119.5 84.9 71.5 Dec............................... 23,565.1 10,970.9 4,932.5 12,594.2 7,661.8 131.0 351.8 118.4 84.7 71.6 1976—Jan................................ 23,845.0 11,517.7 4,789.0 12,327.3 7,538.3 132.4 366.0 115.4 82.9 70.3 Feb............................... *■25,528.4 12,212.0 r5,324.6 *■13,316.4 7,991.8 140.9 375.4 *•128.1 89.6 74.6 Mar.............................. *•26,474.4 12,629.6 r5,560.9 *•13,844.8 8,283.9 144.6 377.5 131.4 92.5 77.2 Apr............................... *■25,792.8 12,482.8 r5,302.4 *•13,310.0 *•8,007.7 140.3 374.9 *•124.6 *•88.4 *•74.2 May............................. '25,490.9 12,179.0 r5,327.1 *•13,311.9 *•7,984.7 139.3 380.2 126.9 88.2 73.3 June............................. 26,636.6 12,844.3 5,566.9 13,792.4 8,225.5 145.1 400.8 132.0 91.0 75.2 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

A12 MONEY STOCK □ AUGUST 1976 MEASURES OF THE MONEY STOCK (In billions of dollars) Seasonally adjusted Not seasonally adjusted Period Mi M2 Mi Mi Ms Mi M2 Mi Mi Ms Composition of measures is described in the Note below. 1973—Dec............................... 270.5 571.4 919.5 634.9 982.9 278.3 576.5 921.8 640.5 985.8 1974—Dec............................... 283.1 612.4 981.6 702.2 1,071,4 291.3 617.5 983.8 . 708.0 1,074.3 1975—June............................. 291.0 642.4 1,040.2 726.5 1.124.3 290.3 6-43.5 1,044.5 725.8 1,126.8 July.............................. 291.9 647.5 1.051.6 729.6 1,133.7 292.1 647.8 1,055.0 729.1 1,136.3 Aug.............................. 293.2 650.6 1.060.6 729.3 1.139.3 290.0 647.2 1,057.1 728.4 1,138.3 Sept.............................. 293.6 652.9 1,068.1 731.9 1,147.1 291.7 649.5 1,062.8 732.2 1*145.5 Oct............................... 293.4 655.8 1,075.8 736.7 1,156.6 292.3 653.2 1,070.4 736.9 1,154.1 Nov.............................. 295.6 662.1 1,086.5 743.9 1,168.3 297.4 660.2 1,080.6 743.0 1,163.5 Dec............................. 294.8 664.3 1,092.9 747.2 1,175.8 303.2 669.3 1,094.6 752.8 1,178.1 1976—Jan............................... 295.1 670.2 1,103.7 749.4 1,182.9 301.0 675,3 1,107.1 753.7 1,185.6 Feb.. ........................... 296.5 678.5 1,117.2 753.8 1,192.6 292.9 675.3 1,113.3 748.4 1.186.3 Mar.............................. 298.0 683.4 1,127.3 756.5 1.200.5 295.2 683.3 1,129.0 755.1 1,200.8 Apr............................... 301.7 691.9 1.141.1 763.4 1.212.5 303.3 696.7 1,149.2 766.1 1,218.6 May............................. 303.3 697.2 1.151.2 765.4 1,219.4 298.4 695.6 '1,152.0 763.0 1.219.4 June............................. 303.0 700.2 1,158.5 770.8 1,229.2 302.2 701.5 1,163.5 770.7 1,232.6 Note.—Composition of the money stock measures is as follows: of mutual savings banks, savings and loan shares, and credit union shares (nonbank thrift). Mi: Averages of daily figures for (1) demand deposits of commercial Mi: M2 plus large negotiable CD’s. banks other than domestic interbank and U.S. Govt., less cash items in Ms: Mi 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, Mi, Mi, and Ms, see Banks; and (3) currency outside the Treasury, F.R. Banks, and vaults of “Revision of Money Stock Measures” on pp. 82-87 of the Feb. 1976 commercial banks. Bulletin. Beginning Oct. 1975, money stock measures and related data M2: Averages of daily figures for Mi plus savings deposits, time de­ have been revised to incorporate benchmark data from the Dec. 31, 1975, posits open account, and time certificates of deposit other than negoti­ call report. able CD’s of $100,000 of large weekly reporting banks. Latest monthly and weekly figures are available from the Board’s H.6 Ms: M2 plus the average of the beginning and end-of-month deposits release. Back data are 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 deposits bank deposits bank Govt. Cur­ De­ thrift Cur­ thrif t de­ ren­ mand insti­ ren­ insti­ pos­ cy de­ tu­ cy Do­ tu­ its3 pos­ tions2 mes­ tions2 its CD’s1 Other Total Mem­ tic Total CD’s1 Other Total ber non­ mem­ ber 1973—Dec. 61.5 209.0 63.5 300.9 364.4 348.0 62.7 156.5 56.3 215.7 64.0 298.2 362.2 345.3 6.3 1974—Dec. 67.8 215.3 89.8 329.3 419.1 369.2 69.0 159.7 58.5 222.2 90.5 326.3 416.7 366.3 4.9 1975—June 71.0 220.0 84.1 351.4 435.5 397.8 71.2 157.2 58.9 219.1 82.3 353.2 435.5 401.0 4.2 July. 71.3 220.6 82.1 355.5 437.6 404.1 71.9 157.9 59.4 220.3 81.3 355.7 436.9 407.2 3.4 Aug. 71.9 221.3 78.8 357.4 436.2 410.0 72.1 155.8 59.0 217.8 81.1 357.3 438.4 409.9 2.7 Sept. 72.0 221.6 79.1 359.2 438.3 415.2 71.9 157.0 59.7 219.9 82.7 357.7 440.4 413.3 3.9 Oct.. 72.6 220.8 80.9 362.4 443.3 420.0 72.5 156.6 60.3 219.9 83.7 360.8 444.5 417.2 3.4 Nov. 73.4 222.1 81.8 366.5 448.3 424.4 73.9 159.0 61.4 223.5 82.9 362.8 445.6 420.4 3.5 Dec. 73.7 221.0 82.9 369.6 452.4 428.6 75.1 162.1 62.6 228.1 83.5 366.2 449.6 425.3 4.1 1976—Jan.. 74.2 220.8 79.2 375.2 454.4 433.5 73.8 162.0 62.1 227.2 78.5 374.3 452.8 431.9 3.8 Feb. 75.1 221.5 75.4 381.9 457.3 438.8 74.1 155.7 59.9 218.8 73.0 382.5 455.5 438.0 4.5 Mar. 75.7 222.3 73.2 385.4 458.5 444.0 75.1 156.8 60.2 220.1 71.8 388.1 459.9 445.7 3.9 Apr. 76.7 225.0 71.4 390.2 461.6 449.2 76.3 161.7 62.3 227.0 69.4 393.4 462.8 452.5 3.8 May 77.4 226.0 68.2 393.9 462.0 454.0 77.2 157.1 61.0 221.2 67.4 397.2 464.6 >•456.4 3.7 June 77.6 225.3 70.6 397.2 467.9 458.3 77.8 159.0 62.3 224.4 69.1 399.3 468.4 461.9 4.7 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

AUGUST 1976 □ BANK RESERVES; BANK CREDIT A13 AGGREGATE RESERVES AND MEMBER BANK DEPOSITS (In billions of dollars) Member bank reserves,S.A.i Deposits subject to reserve requirements3 Total member bank deposits plus nondeposit S.A. N.S.A. items4 Period Non­ Total bor­ Re­ Avail­ Demand Demand rowed quired able2 Time Time Total and Total and S.A. N.S.A. savings Private U.S. savings Private U.S. Govt. Govt. 1973— Dec.... 34.98 33.69 34.68 32.78 442.8 279.7 158.1 5.0 447.5 278.5 164.0 5.0 449.4 454.0 1974—Dec. i,. 36.63 35.90 36.37 34.42 486.9 322.9 160.6 3.4 491.8 321.7 166.6 3.5 495.3 500.1 1975—June... 35.07 34.85 34.87 32.90 499.5 330.5 165.8 3.2 497.5 330.2 164.2 3.1 506.5 504.5 July. .. 34.98 34.68 34.79 32.89 498.3 330.8 164.9 2.6 497.2 330.2 164.5 2.5 505.1 504.0 Aug.... 34.88 34.67 34.69 32.77 496.3 328.4 165.1 2.8 494.8 330.5 162.3 2.0 503.3 501.8 Sept— 34.99 34.59 34.80 32.77 498.4 329.8 165.6 3.0 499.1 332.2 164.0 2.9 505.5 506.1 Oct.1.. 34.79 34.60 34.58 32.61 500.1 333.1 164.0 3.0 500.4 334.7 163.3 2.5 508.0 508.3 Nov...... 34.73 34.67 34.44 32.43 505.9 336.1 165.9 3.9 503.6 334.3 166.7 2.6 514.1 511 .9 Dec.... 34.75 34.62 34.49 32.44 506.0 338.7 164.4 3.0 510.9 337.2 170.7 3.1 514.4 519.3 1976—Jan. *.. 34.32 34.24 34.08 32.17 506.2 338.9 164.7 2.6 511.1 337.9 170.3 2.9 514.1 519.0 Feb---- 34.05 33.97 33.83 31.85 507.6 339.5 165.5 2.6 504.2 337.5 163.4 3.4 515.6 512.2 Mar.... 34.00 33.95 33.78 31.75 507.8 339.4 165.8 2.5 506.4 339.6 163.9 2.9 516.0 514.7 Apr.... 34.02 33.98 33.87 31.87 509.8 340.2 167.2 2.5 511.9 340.2 168.8 2.9 517.3 519.4 May... 34.14 34.02 33.93 31.95 507.8 338.3 *"167.2 2.3 506.0 339.9 163.4 2.8 515.3 513.6 June... 34.34 34.21 34.12 32.01 513.9 342.3 167.9 3.7 512.7 342.5 166.7 3.6 522.3 521.2 1 Averages of daily figures. Member bank reserve series reflect actual 3 Averages of daily figures. Deposits subject to reserve requirements reserve requirement percentages with no adjustment to eliminate the include total time and savings deposits and net demand deposits as defined effect of changes in Regulations D and M. There are breaks in series by Regulation D. Private demand deposits include all demand deposits because of changes in reserve requirements effective Dec. 12, 1974, Feb. except those due to the U.S. Govt., less cash items in process of collection 13, May 22, and Oct. 30, 1975, and Jan. 8, 1976. In addition, effective and demand balances due from domestic commercial banks. Jan. 1, 1976, statewide branching in New York was instituted. The sub­ 4 “Total member bank deposits” subject to reserve requirements, plus sequent merger of a number of banks raised required reserves because of Euro-dollar borrowings, loans sold to bank-related institutions, and higher reserve requirements on aggregate deposits at these banks. certain other nondeposit items. This series for deposits is referred to as 2 Reserves available to support private nonbank deposits are defined “the adjusted bank credit proxy.” as (1) required reserves for (a) private demand deposits, (b) total time Note.—Back data and estimates of the impact of required reserve and savings deposits, and (c) nondeposit sources subject to reserve re­ changes may be obtained from the Banking Section, Division of Research quirements, and (2) excess reserves. This series excludes required reserves and Statistics, Board of Governors of the Federal Reserve System, Wash­ for net interbank and U.S. Govt, demand deposits. ington, D.C. 20551. LOANS AND INVESTMENTS AT ALL COMMERCIAL BANKS (In billions of dollars) Seasonally adjusted Not seasonally adjusted Loans Securities Loans Securities Total Total loans Commercial loans Commercial and and industrial3 and and industrial3 invest­ Plus U.S. invest­ Plus U.S. ments 1 Total1 loans Plus Treas­ Other4 ments 1 Total i loans Plus Treas­ Other4 sold2 Total loans ury sold2 Total loans ury sold2 sold2 1971—Dec. 31___ 485.7 320.9 323.7 116.1 117.7 60.6 104.2 497.9 328.3 331.1 118.5 120.2 64.9 104.7 1972—Dec. 31----- 558.0 378.9 381.5 130.2 131.9 62.6 116.5 571.4 387.3 389.9 132.7 134.4 67.0 117.1 1973—Dec. 31.... 633.4 449.0 453.3 156.4 159.0 54.5 129.9 647.3 458.5 462.8 159.4 162.0 58.3 130.6 1974—Dec. 315... 690.4 500.2 505.0 183.3 186.0 50.4 139.8 705.6 510.7 515.5 186.8 189.6 54.5 140.5 1975—Aug. 27----- 709.3 490.2 494.7 176.5 179.3 75.0 144.1 706.1 490.3 494.8 175.3 178.1 72.0 143.8 Sept. 24... . 712.7 491.5 496.0 175.4 178.2 76.7 144.5 712.5 492.8 497.3 175.8 178.6 75.4 144.3 Oct. 29.... 716.3 495.0 499.7 176.3 179.2 76.0 145.3 714.6 493.7 498.4 175.3 178.2 75.9 144.9 Nov. 26___ 722.2 498.5 503.2 177.1 179.9 76.8 146.9 722.4 497.6 502.3 176.5 179.3 79.4 145.4 Dec. 31___ 721.1 496.9 501.3 176.0 178.5 79.4 144.8 737.0 507.4 511.8 179.3 181.8 84.1 145.5 1976—Jan. 28___ 723.3 497.3 501.6 176.6 179.1 81.0 145.0 721.4 492.6 496.9 174.4 176.9 84.8 144.0 Feb. 25___ 726.7 497.8 502.3 175.1 177.8 84.4 144.5 720.8 491.9 496.4 173.5 176.2 85.4 143.6 Mar. 31___ 731.2 499.7 503.9 171.4 174.0 88.2 143.3 729.6 496.9 501.1 171.3 173.9 89.3 143.5 Apr. 28. . .. 734.5 500.5 504.7 170.5 173.1 90.0 144.0 732.1 496.7 500.9 170.6 173.2 90.2 145.2 May 26___ 737.6 500.6 505.0 170.7 173.4 93.0 144.0 735.1 500.0 504.4 170.8 173.5 90.5 144.6 June 30.... 738.8 500.7 505.2 170.2 173.0 94.0 144.1 743.3 507.2 511.7 172.4 175.2 90.8 145.3 July 28*. , . 743.1 504.7 509.2 171.0 173.8 92.7 145.7 740.3 505.2 509.7 170.7 173.5 89.5 145.6 1 Adjusted to exclude domestic commercial interbank loans. As of Oct. 31, 1974, “Total loans and investments” of all commercial 2 Loans sold are those sold outright to 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 re­ was 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: Back data for 1959-75 available about $400 million as of June 30, 1972 and by about $1.2 billion as of from Banking Section, Division of Research and Statistics; for 1948-58, March 31, 1976. See. Aug. 1968 Bulletin, pp. A-94—A-97. For description of seasonally 4 Farmers Home Administration insured notes included in “Other adjusted series for total loans and investments, see Dec. 1971 Bulletin, securities” rather than in loans beginning June 30, 1971, when such notes pp. 971-73 and for commercial and industrial loans, see July 1972 Bul­ totaled about $700 million. letin, p. 683. Data are for last Wed. of month except for June 30 and Dec. 5 Data beginning June 30, 1974, include one large mutual savings 31; data are partly or wholly estimated except when June 30 and Dec. bank that merged with a nonmember commercial bank. As of that date 31 are call dates. there were increases of about $500 million in loans, $100 million in “Other securities,” and $600 million in “Total loans and investments.” Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 COMMERCIAL BANKS □ AUGUST 1976 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 Total3 Demand ings counts® banks U.S. Other ac­ De­ Treas­ 2 counts4 mand Time Time 5 ury U.S. Other Govt. All commercial banks: 1941—Dec. 31.. 50,746 21,714 21,808 7,225 26,551 79,104 71,283 100,,9988:2 44,349 15,952 23 7,173 14,278 1947—Dec. 31 8. 116,284 38,057 69,221 9,006 37,502 155,377 144,103 12,792 240 1,343 94,367 35,360 65 10,059 14,181 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 20,986 13,472 1970—Dec. 319. 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 42,958 13,686 1971—Dec. 31.. 516,564 346,930 64,930104,704 99,832 640,255 537,946 32,205 2,908 10,169 220,375 272,289 25,912 47,211 13,783 1972—Dec. 31.. 598,808 414,696 67,028117,084113,128 739,033 616,037 33,854 4,194 10,875 252,223 314,891 38,083 52,658 13,927 1973—Dec. 31.. 683,799 494,947 58,277130,574118,276 835,224 681,847 36,839 6,773 9,865 263,367 365,002 58,994 58,128 14,171 1974—Dec. 31.. 744,107 549,183 54,451 140,473128,042 919.552 747,903 43,48311,496 4,807 267,506 420,611 58,369 63,650 14,465 1975—July 30.. 738,060 525,250 69.400 143 410106,840 899,590 723,730 33,18010,830 2,220 243,000 434,500 61,870 66,080 14,583 Aug. 27.. 741.630 525,780 72,020 143,830 104,750 900,870 724,650 31,54010,570 2,830 242.590 437,120 59,920 66,620 14,595 Sept. 24.. 743,970 524,270 75,360 144,340 106,220 906,410 726,840 31,33010.990 3,180 240,570 440,770 61,030 66,980 14,612 Oct. 29.. 747,250 526,420 75,940144,890 110,670 915,890 736.870 31,90011,210 2,650 247.590 443,520 60,640 67,550 14.628 Nov. 26.. 757,450 532,660 79.400 145,390 123,150 939,310 753,000 34.560 11,160 3,530 257,640 446,110 66,780 68,000 14.624 Dec. 31.. 775,794 546,172 84,119145,503133,614 964,918 786,252 41,81112,020 3,114 278,692 450,615 60,224 69,125 14,633 1976—Jan. 28?. 756.630 527,820 84,770144,040112,720 927.140 743,140 32,11011,540 3,790 245,600 450,100 67,250 68,870 14,611 Feb. 28*. 757,540 528,560 85,420143.560 111,470 928,540 741,230 31.560 11,370 4,010 242,810 451,480 68,490 69,110 14.624 Mar. 31*10 767,260 534,530 89,260143,470 120,870 934,440 766,680 37,510 11,860 2,430 256,930 457,950 63,420 70,070 14.628 Apr. 28*. 765,550 530,170 90,180145,200 113,210 926,370 753,150 32,280 10.990 4,120 250,200 455,560 68,480 70,610 14,632 May 26*. 767,070 531,990 90,470144,610 111,740 928.140 755,010 33,620 10,530 3.660 247,630 459,570 66,170 71,400 14,637 June 30*. 779,780 543,700 90,800145,280125,190 957,000 782.870 38,270 10,580 4.660 266,470 462,890 65,850 72,080 14.636 July 28*. 772,860 537,760 89,540145.560111,560 934,620 761,490 33,10010,160 3,540 250,700 463,990 66,790 72,190 14.636 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 5,886 6,619 1947—Dec. 31... 97,846 32,628 57,914 7,304 32,845 132,0601 122,528 12,353 50 1,176 80,609 28,340 54 8,464 6,923 1960—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 17,398 6,174 1970—Dec. 319.. 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 34,100 5.767 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 37,279 5,727 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 41,228 5,704 1973—Dec. 31... 528,124 391,032 41,494 95,598100,098 655,898 526,837 34,782 5,843 8,273 202,564 275,374 55,611 44,741 5,735 1974—Dec. 31... 568,532 429,537 38,921 100,073106,995 715,615 575,563 41,06210,052 3,183 204,203 317,064 52,850 48,240 5,780 1975—July 30... 552,727 403,137 49,938 99,652 89.743 687,844 546,420 30,980 9,198 1,539 184,225 320,478 56,084 49,900 5.796 Aug. 21... 554,007 402,281 51,899 99,827 87,208 686,266 545,021 29,335 8,932 2,099 183,283 321,372 54,175 50,281 5.792 Sept. 24... 555,096 400,695 54,355 100,046 88,004 689,717 546,360 29,150 9,360 2,343 181,340 324,167 54,929 50,543 5.792 Oct. 29... 556.383 401,492 54,546 100,345 91,397 695,312 552,649 29.568 9,578 1,952 186,851 324,700 54,250 50,963 5.796 Nov. 26... 564,023 405,805 57,471 100,747102,103 714,112 564,835 32,064 9,527 2,708 194,492 326,044 60,162 51,199 5,791 Dec. 31... 578,560 416,366 61,519100,675108,489 733,635 590,776 38.56910,015 2,255 210,824 329,113 53,646 52,078 5,788 1976—Jan. 28... 563,387 402,020 61,704 99,663 93,808 705,093 556,274 29,712 9,529 2,908 185,773 328,352 61,022 52,167 5,765 Feb. 28... 562.940 401,731 61,869 99,340 91,914 704,357 552,942 29,145 9,357 2,977 183,458 328,005 62,051 52,300 5.768 Mar. 31 !0. 569,913 406,148 64,636 99,129 100,455 710,228 573,878 34,934 9,848 1,769 194,932 332,395 57,470153,191 5,778 Apr. 28... 567.384 402,147 64,892 tOO,345 93.743 702,130 561,110 29,923 8,978 3,281 189,361 329,567 62,002 53,753 5.775 May 26... 567,220 402,435 65,058 99,727 92,340 702,517 561,393 30,676 8,517 2,702 187,099 332,399 59,591 54,450 5,777 June 30... 577,480 411,676 65,627 100,177 104,052 726,745 585,354 35,595 8,570 3,668 202,144 335,377 59,277 54,986 5.776 July 28*.. 570,238 405,401 64,467100,370 92,393 706,431 565,287 30,721 8,150 2,721 188,701 334,994 60,344 55,051 5.776 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 1960—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. 319.. 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 66,679116,298111,333 732,519 612,822 33,366 4,113 10,820 250,693 313,830 37,556 52,166 13,721 1973—Dec. 31... 678,113 490,527 57,961129,625116,266 827,081 677,358 36,248 6,429 9,856 261;530 363,294 57,531 57,603 13,964 1974—Dec. 31... 734,516 541,111 54,132139,272125,375 906,325 741,665 42,58710,693 4,799 265,444 418,142 55,988 63,039 14,216 1975—June 30... 736,164 526,272 67,833142,060125,181 914,781 746,348 41,24410,252 3,106 261,903 416,962 59,310 65,986 14,320 Dec. 31... 762,400 535,170 83,629143,602128,256 944,654 775;209 40,25910,733 3,108 276,384 433,352 56,775 68,474 14,372 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. 319.. 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—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 Dec. 31... 441,135 315,738 46,799 78,598 78,026 553,285 447,590 22,305 7,302 1,788 159,840 250.493 40,875 38,969 4,741 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ COMMERCIAL BANKS A15 PRINCIPAL ASSETS AND LIABILITIES AND NUMBER, BY CLASS OF BANK—Continued (Amounts in millions of dollars) Loans and investments Deposits Total assets— Classification by Securities Total Interbank3 Other Total Num­ FRS membership Cash lia­ Bor­ capital ber and FDIC assets 3 bilities row­ ac­ of insurance Total Loans U.S. and Total3 Demand ings counts6 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 1 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 I960—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. 319... 94,760 66,963 11,196 16,600 25,472 125,460101,512 11,091 750 1,720 45.734 42,218 5,478 9,232 1,147 1972—Dec. 31.... 115,426 82,889 11,530 21,008 29,176 150,697123,186 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 29,387 166,780131,421 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 30,473 181,683144,799 17,565 3,301 746 49,807 73,380 13,247 12,425 1,074 1975—June 30. . . 134,759 100,968 12,004 21,787 31,466 179,787 141,995 18,751 2,771 443 48,621 65,65414,380 12,773 1,064 1975—Dec. 31 . .. 137,620100,823 14,720 22,077 30,451 180,495 143,409 16,265 2,712 467 50,984 67,656 12,771 13,105 1,046 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 I960—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. 319... 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 14,767147,013 130,316 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 18,380190,435 165,827 1,525 642 1,616 61,240100,804 3,138 14,799 8,436 1975—June 30. . . 173,238 113,074 18,223 41,942 18,029 198,157 172,707 1,397 676 940 60,706108,816 2,976 15,730 8,526 1975—Dec. 31 . .. 183,645 118,609 22,109 42,927 19,778210,874 184,210 1,689 719 853 65,560115,203 3,128 16,400 8,585 Noninsured nonmember: 1941—Dec. 31.... 1,457 455 761 241 763 2,283 1,872 $29 i,:291 253 13 329 852 1947—Dec. 318... 2,009 474 1,280 255 576 2,643 2,251 1771 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. 319... 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 8 2,062 2,857 2,382 611 249 1975—June 30. . . 11,725 9,559 358 1,808 3,534 16,277 8,314 1,338 957 11 2,124 3,320 3,110 570 253 1975—Dec. 31 .. . 13,674 11,283 490 1,902 5,359 20,544 11,323 1,552 1,291 6 2,308 5,115 3,449 651 261 Total nonmember: 1941—Dec. 31.... 7,233 3,696 2,270 1,266 3,431 10,992 9,573 i157 5,1504 3,613 18 1,288 7,662 1947—Dec. 31.... 18,454 5,432 11,318 1,703 4,659 23,334 21,591 439 190 167 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. 319... 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.... 111,674 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 .... 175,690119,761 15,530 40,400 21,047204,051 172,454 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 21,563214,434 181,021 2,735 1,633 951 62,830 112,136 6,086 16,300 8,779 1975—Dec. 31 .. . 197,319 129,892 22,599 44,829 25,137231,418195,533 3,241 2,010 859 67,868 120,318 6,577 17,051 8,846 1 Loans to farmers directly guaranteed by CCC were reclassified as figures for all bank-premises subsidiaries and other significant majoritysecurities and Export-Import Bank portfolio fund participations were owned domestic subsidiaries) and (2) reporting of figures for total loans reclassified from loans to securities effective June 30, 1966. This reduced and for individual categories of securities on a gross basis—that is, before “Total loans” and increased “Other securities” by about $1 billion. deduction of valuation reserves—rather than net as previously reported. “Total loans” include Federal funds sold, and beginning with June 1967 10 See last paragraph of note 1, second paragraph of note 4, and securities purchased under resale agreements, figures for which are in­ note 6. cluded in “Federal funds sold, etc.,” on p. A-16. Effective June 30, 1971, Farmers Home Administration notes were Note.—Data are for all commercial banks in the United States (including classified as “Other securities” rather than “Loans.” As a result of this Alaska and Hawaii, beginning with 1959). Commercial banks represent change, approximately $300 million was transferred to “Other securities” all commercial banks, both member and nonmember; stock savings for the period ending June 30, 1971, for all commercial banks. banks; nondeposit trust companies; and U.S. branches of foreign banks. Effective Mar. 31, 1976, includes “reserves for loan losses” and “un­ Figures for member banks before 1970 include mutual savings banks earned income on loans.” as follows: 3 before Jan. 1960 and 2 through Dec. 1960. Those banks See also table (and notes) at the bottom of p. A-24. are not included in insured commercial banks. 2 See first 2 paragraphs of note 1. Effective June 30, 1969, commercial banks and member banks exclude 3 Reciprocal balances excluded beginning with 1942. a small national bank in the Virgin Islands; also, member banks exclude, 4 Includes items not shown separately. See also note 1. and noninsured commercial banks include, through June 30, 1970, a small Effective Mar. 31, 1976, “reserves for loan losses” and unearned income member bank engaged exclusively in trust business; beginning 1973, on loans,” which for all commercial banks are estimated to be approx­ exclude 1 national bank in Puerto Rico. imately $14.5 billion, have been netted against “other assets” and “other Beginning Dec. 31, 1973, June 30, 1974, and Dec. 31, 1974, June 30, liabilities” and, therefore, against “total assets/liabilities.” 1975, respectively, member banks exclude and noninsured nonmember 5 See third paragraph of note 1 above. banks include 1, 2, 3, and 4 noninsured trust companies that are member 6 Effective Mar. 31, 1976, includes “reserves for securities” and a of the Federal Reserve System. portion of “reserves for loan losses.” Comparability of figures for classes of banks is affected somewhat by 7 For the last-Wednesday-of-the-month series, figures for call dates changes in F.R. membership, deposit insurance status, and by mergers are shown for June and December as soon as they became available. etc. 8 Beginning with Dec. 31, 1947, the series was revised; for description, Figures are partly estimated except on call dates. see note 4, p. 587, May 1964 Bulletin. For revisions in series before June 30, 1947, see July 1947 Bulletin, 9 Figure takes into account the following changes, which became pp. 870-71. effective June 30, 1969: (1) inclusion of consolidated reports (including Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 COMMERCIAL BANKS □ AUGUST 1976 ASSETS BY CLASS OF BANK, DECEMBER 31, 1975 (Assets and liabilities are shown in millions of dollars.) Member banks1 All Insured Large banks Account commercialcommercial Nonbanks banks member Total New City of Other All other banks1 York Chicago large City Cash, bank balances, items in process........................... 133,614 128,256 108,477 24,778 3,888 43,730 36,081 25,137 12,256 12,248 9,243 774 200 3,081 5,188 3,013 Reserves with F.R. Banks.......................................... 26,776 26,776 26,776 3,349 1,433 12,283 9,712 Demand balances with banks in United States........ 34,866 32,091 19,389 6,496 195 3,752 8,947 "*15,477* Other balances with banks in United States............ 8,866 7,367 5,184 151 29 1,995 3,008 3,683 Balances with banks in foreign countries................. 3,598 2,605 2,356 588 27 1,044 696 1,242 47,251 47,169 45,530 13,421 2,003 21,575 8,531 1,721 Total securities held—Book value................................. 229,622 227,230 162,194 18,499 7,134 53,616 82,945 67,428 U.S. Treasury.............................................................. 84,119 83,629 61,519 9,005 3,212 21,411 27,892 22,600 34,4C9 33,941 21,186 1,508 485 6,031 13,162 13,223 102,029 101,757 74,079 7,204 3,162 24,679 39,035 27,950 All other securities...................................................... 9,065 7,903 5,410 783 275 1,496 2,855 3,655 5,338 5,332 5,182 1,902 563 2,484 232 156 U.S. Treasury.......................................................... 2,982 2,976 2,858 1,072 364 1,315 107 124 Other U.S. Govt, agencies...................................... 711 711 698 247 51 351 50 13 1,142 1,142 1,130 357 102 602 70 12 502 502 495 227 47 216 5 7 Bank investment portfolios........................................ 224,284 221,898 157,012 16,597 6,570 51,132 82,712 67,272 U.S. Treasury.......................................................... 81,137 80,653 58,661 7,933 2; 848 20,096 27,785 22,476 Other U.S. Govt, agencies...................................... 33,698 33,230 20,488 1,262 434 5,680 13,112 13,209 100,887 100,614 72,949 6,847 3,060 24,077 38,965 27,938 8,563 7,401 4,914 556 229 1,280 2,850 3,649 Federal funds sold and securities purchased under agreements to resell................................................ 39,250 37,323 29,122 2,488 1,520 14,562 10,551 10,129 34,099 32,172 24,075 2,080 998 11,094 9,903 10,023 Brokers and dealers.................................................... 3,700 3,700 3,646 62 468 2,614 501 53 1,452 1,452 1,400 346 54 854 146 52 Other loans..................................................................... 507,202 497,846 387,439 73,495 22,261 143,701 147,982 119,763 134,770 134,588 96,018 8,448 1,371 35,198 51,002 38,752 Secured by farmland.............................................. 6,237 6,224 2,702 8 11 302 2,381 3,534 82,307 82,177 59,791 4,138 917 22,650 32,087 22,516 1- to 4-family residences..................................... 76,456 76,331 55,190 3,259 840 20,588 30,503 21,267 5,510 5,493 4,786 238 47 2,619 1,882 724 3,081 3,058 2,610 174 20 1,353 1,063 471 67,865 67,780 47,793 2,847 773 16,616 27,557 20,071 5,850 5,846 4,601 879 77 2,062 1,584 1,249 493 492 449 91 24 158 175 44 5,358 5,354 4,153 787 53 1,904 1,409 1,205 46,226 46,187 33,525 4,302 443 12,245 16,534 12,702 12,624 9,553 8,686 3,366 584 3,905 831 3,938 29,611 29,276 28,088 10,187 4,442 11,199 2,259 1,523 7,175 7,055 6,964 4,477 911 1,400 176 210 3,916 3,822 3,193 415 289 1,560 929 723 20,158 20,129 11,244 94 162 2,564 8,424 8,914 179,348 174,316 145,930 38,553 12,002 55,749 39,626 33,419 106,352 106,019 75,536 4,854 1,717 26,871 42,093 30,816 83,205 82,969 58,830 3,153 925 21,178 33,574 24,375 Passenger automobilies....................................... 33,401 33,279 21,963 432 163 6,600 14,769 11,437 Residential-repair/modernize............................. 5,859 5,845 4,189 222 36 1,731 2,199 1,670 12,312 12,311 10,846 1,107 509 6,048 3,181 1,466 Charge-account credit cards........................... 9,501 9,500 8,506 815 478 4,817 2,395 995 2,811 2,810 2,340 293 31 1,231 785 471 Other retail consumer goods.............................. 15,318 15,283 10,615 164 108 3,749 6,594 4,704 8,721 8,719 6,276 97 39 2,221 3,919 2,445 6,597 6,564 4,338 67 69 1,527 2,675 2,259 Other instalment loans........................................ 16,315 16,251 11,217 1,228 109 3,049 6,831 5,098 Single-payment loans to individuals...................... 23,147 23,050 16,706 1,701 792 5,694 8,520 6,441 All other loans............................................................ 13,248 13,087 11,781 3,100 784 5,255 2,643 1,466 Total loans and securities.............................................. 776,074 762,400 578,755 94,483 30,915 211,880 241,478 197,319 17,474 17,390 13,061 1,415 539 5,232 5,875 4S413 Investments in subsidiaries not consolidated............... 2,015 1,993 1,970 835 146 958 31 45 Customer acceptances outstanding............................... 8,952 8,679 8,424 4,319 249 3,538 318 527 27,069 25,937 23,093 6,586 1,287 11,117 4,103 3,976 965,198 944,654 733,780 132,416 37,024 276,454 287,886 231,418 Number of banks........................................................... 14,633 14,372 5,787 12 9 155 5,611 8,846 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

AUGUST 1976 □ COMMERCIAL BANKS A17 LIABILITIES AND CAPITAL BY CLASS OF BANK, DECEMBER 31, 1975 (Assets and liabilities are shown in millions of dollars.) Member banks1 All Insured Large banks Non­ Account commercialcommercial member banks banks Total All other banks1 New City of Other York Chicago large City Demand deposits............................................................ 323,617 319,751 251,649 54,236 10,378 91,528 95,507 71,968 Mutual savings banks................................................. 1,325 1,160 1,063 494 1 221 347 262 Other individuals, partnerships, and corporations.. 246,559 245,471 187,632 30,546 7,754 70,913 78,419 58,927 U.S. Government........................................................ 3,114 3,108 2,255 139 34 809 1,274 859 18,726 18,595 13,058 779 191 3,867 8,221 5,667 Foreign governments, central banks, etc................... 1,859 1,659 1,610 1,318 18 261 13 248 33,768 33,453 32,048 14,436 1,868 11,442 4,302 1,720 Banks in foreign countries......................................... 6,719 5,646 5,459 3,906 213 1,212 129 1,259 Certified and officers’ checks, etc............................... 11,548 10,659 8,523 2,618 299 2,804 2,802 3,025 Time and savings deposits.............................................. 462,915 455,458 339,350 45,551 16,302 124,194 153,303 123,565 160,087 159,725 114,228 7,061 2,402 40,647 64,118 45,860 280 280 223 76 146 58 Mutual savings banks................................................ 517 499 490 195 5 239 52 26 Other individuals, partnerships, and corporations.. 229,414 224,878 168,882 25,975 10,467 61,277 71,163 60,531 U.S. Government........................................................ 573 573 462 75 1 183 203 111 48,113 47,896 34,355 1,114 1,055 15,307 16,879 13,758 Foreign governments, central banks, etc................... 12,424 11,373 11,187 7,216 1,212 2,719 39 1,238 Commercial banks in United States......................... 9,550 9,038 8,379 2,997 1,079 3,612 691 1,171 Banks in foreign countries......................................... 1,957 1,196 1,145 918 80 135 12 812 786,532 775,209 590,999 99,788 26,680 215,722 248,810 195,534 Federal funds purchased and securities sold under agreements to repurchase........................................... 53,811 52,126 49,305 9,043 6,367 26,601 7,294 4,506 6,412 4,649 4,342 2,114 25 1,828 374 2,071 Mortgage indebtedness.................................................. 765 763 548 54 16 300 178 217 9,548 9,267 9,012 4,884 252 3,555 321 536 Other liabilities............................................................... 29,964 25,190 20,206 4,605 888 7,715 6,997 9,758 887,033 867,204 674,411 120,489 34,228 255,721 263,974 212,622 Minority interest in consolidated subsidiaries............. 5 4 1 1 4 9,035 8,972 7,293 1,629 482 2,777 2,405 1,742 Reserves for bad debts (IRS).................................... 8,696 8,641 7,078 1,627 482 2,672 2,297 1,619 Other reserves on loans.............................................. 150 145 92 1 43 49 57 Reserves on securities............................................... 189 187 123 1 62 60 66 69,125 68,474 52,074 10,298 2,314 17,956 21,506 17,051 Capital notes and debentures..................................... 4,479 4,379 3,494 779 80 1,681 954 985 64,646 64,095 48,580 9,519 2,235 16,275 20,551 16,066 Preferred stock........................................................ 53 48 28 10 18 25 15,601 15,495 11,498 2,275 568 3,755 4,900 4,103 26,775 26,617 19,975 3,848 1,145 7,079 7,902 6,800 21,340 21,143 16,562 3,396 472 5,310 7,385 4,777 Other capital reserves.............................................. 876 792 516 49 121 346 360 Total liabilities, reserves, minority interest, capital 965,198 944,654 733,780 132,416 37,024 276,454 287,886 231,418 239,484 236,021 171,816 26,241 6,473 57,702 81,401 67,668 762,528 753,182 572,278 95,301 25,851 207,553 243,574 190,250 514,414 505,174 388,589 74,436 21,931 143,973 148,249 125,826 Selected ratios: Percentage of total assets 13.8 13.6 14.8 18.7 10.5 15.8 12.5 10.9 23.8 24.1 22.1 14.0 19.3 19.4 28.8 29.1 .6 .6 .7 1.4 1.5 .9 .9 .1 U.S. Treasury...................................................... .3 .3 .4 .8 1.0 .5 . 1 States and political subdivisions........................ . 1 . 1 .2 .3 .3 .2 All other trading account securities................... . 1 .1 .2 .4 .3 .2 Bank investment portfolios.................................... 23.2 23.5 21.4 12.5 17.7 18.5 28.7 29.1 8.4 8.5 8.0 6.0 7.7 7.3 9.7 9.7 States and political subdivisions......................... 10.5 10.7 9.9 5.2 8.3 8.7 13.5 12.1 4.4 4.3 3.5 1.4 1.8 2.5 5.5 7.3 Other loans and Federal funds sold.......................... 56.6 56.7 56.8 57.4 64.2 57.2 55.1 56.1 All other assets............................................................ 5.8 5.7 6.3 9.9 6.0 7.5 3.6 3.9 Total loans and securities.......................................... 80.4 80.7 78.9 71.4 83.5 76.6 83.9 85.3 Reserves for loans and securities............................... .9 .9 1.0 1.2 1.3 1.0 .8 .8 Equity capital—Total................................................. 6.7 6.8 6.6 7.2 6.0 5.9 7.1 6.9 Total capital accounts................................................ 7.2 7.2 7.1 7.8 6.3 6.5 7.5 7.4 Number of banks........................................................... 14,633 14,372 5,787 12 9 155 5,611 8,846 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A18 WEEKLY REPORTING BANKS □ AUGUST 1976 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKSA (In millions of dollars) Loans Federal funds sold, etc.2 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 1 com­ To mer­ Agri­ Total mer­ US. Other others Total i cial cul­ Real cial Treas­ se­ and tural Pers. estate banks ury curi­ indus­ U.S. U.S. and se­ ties trial Treas­ Other Treas­ Other sales Other curi­ ury secs. ury secs. finance ties1 secs. secs. cos., etc. Large banks— Total 1975 July 2................. 390,574 18,835 15,631 1,713 719 772 279,157 122,288 3,624 981 3,944 101 2,342 9,360 20,593 59,502 9................ 393,618 20,979 15,719 3,914 640 706*279,830 122,052 3,647 2,948 3,285 101 2,333 9,313 20,465 59,417 16................. 387,635 17,085 14,186 1,754 465 680'277,499 121,762 3,640 939 3,513 102 2,335 9,121 20,345 59,405 23................. 383,402 14,130 11,787 1,444 333 566 276,024 121,061 3,644 879 3,551 114 2,326 8,952 20,143 59,355 30................. 384,569 15,592 13,359 1,422 342 469 276,053 120,565 3,661 766 3,676 110 2,308 9,128 20,035 59,352 1976 June 2................. 391,422 20,347 15,375 3,568 681 723 269,354 112,615 3,840 1,557 5,922 2,449 7,955 18,187 61,296 9................. 389,153 18,459 13,562 3,472 711 714 268,812 112,273 3,875 2,181 5,824 2,470 7,533 18,079 61,397 16................. 390,924 18,563 14.588 2,407 788 780 270,061 112,527 3,905 1,148 6,118 2,460 8,157 18,208 61,471 23................. 386,904 17,368 13,715 2,042 776 835 268,918 112,471 3,927 1,212 5,836 2,500 7,536 18,153 61,358 30................. 391,935 19,881 16,650 1,652 792 787 270,652 112,903 3,969 1,003 6,276 2,514 7,810 18,285 61,429 July 7................. 389,721 19,422 15,936 1,940 786 760270,193 112,420 3,979 1,122 6,351 2,534 7,525 18,181 61,513 14................. 389,035 18,677 14,672 2,521 722 762269,121 112,140 3,978 1,135 6,119 2,530 7,144 18,098 61,614 21................. 387,646 17,807 14,810 1,629 677 691268,919 112,051 3,976 1,198 6,321 2,508 7,174 17,896 61,748 28................. 384,102 16,484 13.588 1,719 577 600267,113 111,324 3,999 770 6,f"“ 2,536 7,238 17,802 61,777 New York City 1975 July 2.................. 91,915 1,256 819 49 74 314 73,492 38,841 102 825 2,810 473 3,296 8,072 8,813 9................. 92,398 1,064 824 12 228 74,371 38,629 100 2,630 2,265 477 3,194 8,034 8,812 16.................. 91,578 2,228 1,948 56 224 72,391 38,418 99 691 2,470 482 3,164 8,055 8,831 23.................. 89,928 1,540 1,083 227 230 71,497 37,948 102 772 2,491 451 3,063 7,997 8,849 30.................. 90,813 2,309 1,880 239 190 71,551 37,895 111 648 2,602 440 3,168 7,858 8,851 1976 June 2.................. 89,816 2,498 1,793 548 157 67,962 33,997 1,436 3,700 386 2,740 6,857 9.403 9.................. 88,419 1,592 951 452 189 67,856 33,728 1,953 3,636 392 2,527 6.786 9.404 16.................. 88,828 2,141 1,195 584 362 67,660 33.517 992 3,857 391 2,836 6,862 9,426 23.................. 87,828 2,902 2,189 364 349 66,792 33,461 1,075 3,603 394 2,504 6,803 9,382 30.................. 88,155 1,859 1,452 111 286 67,439 33,464 889 3,879 393 2,761 6.787 9,298 July 7.................. 86,883 1,210 632 324 244 67,404 33,397 957 4,001 393 2,562 6,715 9,336 14.................. 87,012 1,507 710 563 234 66,810 33,162 1,017 3,794 394 2,424 6,638 9,343 21.................. 87,910 2,624 2,284 141 199 66,588 32,996 1,095 3,901 390 2,466 6,616 9,359 28.................. 85,189 1,712 1,367 157 188 65,059 32.517 672 3,658 389 2,465 6,604 9,320 Outside New York City 1975 July 2.................... 298,659 17,579 14,812 1,664 645 458205,665 83,447 3,522 156 1,134 1,869 6,064 12,521 50,689 9.................... 301,220 19,915 14,895 3,902 640 478205,459 83,423 3,547 318 1,020 1,856 6,119 12,431 50,605 16. 296,057 14,857 12,238 1,698 465 456205,108 83,344 3.541 248 1,043 1,853 5,957 12,290 50,574 23. 293,474 12,590 10,704 1,217 333 336204,527 83,113 3.542 107 1,060 1,875 5,889 12,146 50,506 30. 293,756 13,283 11,479 1,183 342 279204,502 82,670 3,550 118 1,074 1,868 5,960 12,177 50,501 1976 June 2... 301,606 17,849 13,582 3.020 681 566201,392 78,618 3,763 121 2,222 2,063 5,215 11,330 51,893 9... 300,734 16,867 12,611 3.020 711 525200,956 78,545 3,792 228 2,188 2,078 5,006 11,293 51,993 16... 302,096 16,422 13,393 1,823 788 418202,401 79.010 3,822 156 2,261 2,069 5,321 11,346 52,045 23... 299,076 14,466 11.526 1,678 776 486202,126 79.010 3,842 137 2,233 2,106 5,032 11,350 51,976 30... 303,780 18,022 15,198 1,541 782 501203,213 79,439 3,885 114 2,397 2,121 5,049 11,498 52,131 July 7. 302,838 18,212 15,304 1,616 776 516202,789 79,023 3,895 165 2,350 2,141 4,963 11,466 52,177 14. 302,023 17,170 13,962 1,958 722 528202,311 78,978 3,892 118 2,325 2,136 4,720 11,460 52,271 21. 299,736 15,183 12.526 1,488 677 492202,331 79,055 3,891 103 2,420 2,118 4,708 11,280 52,389 28. 298,913 14,772 12,221 1,562 577 412202,054 78,807 3,919 98 2,430 2,147 4,773 11,198 52,457 ▲ Effective with changes in New York State branch banking laws, reported data for “Outside New York City” (total assets, by about $4.0 beginning Jan. 1, 1976, three large New York City banks are now reporting billion). combined totals for previously affiliated banks that have been converted Historical data (from Jan. 1972) on a basis comparable with 1976 data to branches. are available from the Public Information Department of the Federal The principal effects of these changes were to increase the reported data Reserve Bank of New York on request. for New York City (total assets, by about $5.5 billion) and to decrease the For other notes see p. A-22. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ WEEKLY REPORTING BANKS A19 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKSA—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, Loan of States corp. stocks, Wednesday loss and and Con­ For­ reserve political securities sumer eign All and un­ subdivisions instal­ govts.^ other earned Total Bills Total Do­ For­ ment income mes­ eign on Within 1 to After tic loans1 1 yr. 5 yrs. 5 yrs. Tax Certif. war­ All of rants4 other partici­ All pation5 other6 Large banks- Total 1975 2,313 5,279 34,307 1,586 18,667 5,730 32,166 7,093 5,071 16,822 3,180 60,416 6,302 39,683 2,375 12,056 2 2,325 5,664 34,276 1,406 18,323 5,725 32,471 6,969 5,078 17,261 3,163 60,338 6,318 39,613 2,381 12,026 9 2,359 5,636 34,296 1,355 18,403 5,712 32,203 7,003 5,081 17,038 3,081 60,848 6,414 40,144 2,455 11,835 2,365 5,601 34,325 1,362 18,055 5,709 32,187 7,080 5,102 16,944 3,061 61,061 6,658 39,906 2,439 12,058 .23 2,232 5,773 34,444 1,572 18,181 5,750 32,305 7,403 5,157 16,657 3,088 60,619 6,540 39,816 2,426 11,837 .30 1976 2,155 5,301 36,310 1,941 18,189 8,459 42,809 13,098 6,275 20,715 2,721 58,912 6,145 39,642 2,409 10,716 2 2,090 5,530 36,352 1,801 17,851 8,532 42,563 13,475 6,200 20,312 2,576 59,319 6,123 40,240 2,393 10,563 . 9 2,376 5,662 36,512 1,769 18,232 8,570 42,424 12,786 6,237 20,733 2,668 59,876 6,254 40,367 2,421 10 834 .16 2,365 5,595 36,616 1,756 18,072 8,564 41,331 12,458 6,129 20,132 2,612 59,287 5,875 40,306 2,432 10,674 .23 2,285 5,730 36,738 1,749 18,298 8,419 42,150 12,871 6,140 20,641 2,498 59,252 5,806 40,194 2,404 10,848 2,338 5,728 36,777 1,797 18,262 8,417 41,194 12,492 6,202 20,094 2,406 58,912 5,785 40,073 2,418 10,636 ................July 7 2,218 5,668 36,782 1,782 18,284 8,454 41,668 12,069 6,272 20,111 3,216 59,569 6,598 39,749 2,409 10,813 .14 2,153 5,616 36,883 1,768 18,044 8,498 41,310 11,955 6,150 20,115 3,090 59,610 6,039 40,172 2,430 10,969 2,026 5,637 37,031 1,750 17,575 8,519 41,121 11,934 6,174 19,961 3,052 59,384 5,932 40,115 2,445 10,892 New York City 1975 1,110 2,308 3,571 750 4,194 1,712 7,591 1,606 757 4,337 891 9,576 1,766 5,388 183 2,239 ................July 2 1,101 2,621 3,569 606 4,016 1,721 7,510 1,428 640 4,534 908 9,453 1,693 5,387 182 2,191 1,179 2,503 3,519 541 4,124 1,721 7,333 1,453 685 4,348 847 9,626 1,590 5,757 180 2,099 .16 1,170 2,467 3,519 512 3,828 1,722 7,464 1,654 697 4,256 857 9,427 1,555 5,604 179 2,089 .23 1,018 2,518 3,527 633 3,982 1,745 7,622 1,923 679 4,160 860 9,331 1,530 5,549 178 2,074 .30 1976 629 2,206 3,768 766 3,690 1,711 9,857 3,446 1,040 4,687 684 9,499 1,785 6,004 191 1,519 2 699 2,368 3,787 596 3,618 1,734 9,340 3,287 935 4,445 673 9,631 1,742 6,206 188 1,495 863 2,413 3,804 542 3,801 1,740 9,377 2,889 985 4,780 723 9,650 1,862 6,139 193 1,456 .16 870 2,380 3,807 573 3,538 1,696 8,568 2,662 882 4,361 663 9,566 1,699 6,265 194 1,408 .23 780 2,466 3,802 594 3,844 1,615 9,326 3,172 903 4,614 637 9,531 1,682 6,202 193 1,454 .30 862 2,534 3,801 553 3,824 1,628 8,884 3,081 971 4,226 606 9,385 1,665 6,163 193 1,364 7 795 2,489 3,822 555 3,918 1,640 9,143 3,024 950 4,227 942 9,552 1,685 6,197 197 1,473 810 2,444 3,826 539 3,694 1,645 9,140 3,087 900 4,226 927 9,558 1,683 6,170 186 1,519 679 2,475 3,833 522 3,485 1,652 9,018 3,105 987 4,008 918 9,400 1,652 6,112 185 1,451 Outside New York City 1975 1,203 2,971 30,736 836 14,473 4,018 24,575 5,487 4,314 12,485 2,289 50,840 4,536 34,295 2.192 9,817 ................July 2 1,224 3,043 30,707 800 14,307 4,004 24,961 5,541 4,438 12,727 2,255 50,885 4,625 34,226 2,199 9,835 . 9 1,180 3,133 30,777 814 14,279 3,991 24,870 5,550 4,396 12,690 2,234 51,222 4,824 34,387 2,275 9,736 1,195 3,134 30,806 850 14,227 3,987 24,723 5,426 4,405 12,688 2,204 51,634 5,103 34,302 2,260 9,969 1,214 3,255 30,917 939 14,199 4,005 24,683 5,480 4,478 12,497 2,228 51,288 5,010 34,267 2,248 9,763 1976 1,526 3,095 32,542 1,175 14,499 6,748 32,952 9,652 5,235 16,028 2,037 49,413 4,360 33,638 2,218 9,197 2 1,391 3,162 32,565 1,205 14,233 6,798 33,223 10,188 5,265 15,867 1,903 49,688 4,381 34,034 2,205 9,068 . 9 1,513 3,249 32,708 1,227 14,431 6,830 33,047 9,897 5,252 15,953 1,945 50,226 4,392 34,228 2,228 9,378 .16 1,495 3,215 32,809 1,183 14,534 6,868 32,763 9,796 5,247 15,771 1,949 49,721 4,176 34,041 2,238 9,266 .23 1,505 3,264 32,936 1,155 14,454 6,804 32,824 9,699 5,237 16,027 1,861 49,721 4,124 33,992 2,211 9,394 .30 1,476 3,194 32,976 1,244 14,438 6,789 32,310 9,411 5,231 15,868 1,800 49,527 4,120 33,910 2,225 9,272 ................July 7 1,423 3,179 32,960 1,227 14,366 6,814 32,525 9,045 5,322 15,884 2,274 50,017 4,913 33,552 2,212 9,340 14 1,343 3,172 33,057 1,229 14,350 6,853 32,170 8,868 5,250 15,889 2,163 50,052 4,356 34,002 2,244 9,450 21 1,347 3,162 33,198 1,228 14,090 6,867 32,103 8,829 5,187 15,953 2,134 49,984 4,280 34,003 2,260 9,441 28 For notes see pp. A-l 8 and A-22. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 WEEKLY REPORTING BANKS □ AUGUST 1976 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKSA-Continued (In millions of dollars) Deposits Demand Cash Bal­ Invest­ items Re­ Cur­ ances ments Total in serves rency with in sub­ Other assets/ Domestic Wednesday process with and do­ sidiar­ assets total States inter!jank of F.R. coin mestic ies not liabil- and collec­ Banks banks consol­ tites1 polit­ For­ tion idated ical U.S. eign Total6 IPC sub­ Govt. Com­ Mutual govts., divi­ mer­ sav­ etc.3 sions cial ings Large banks— Total 1975 July 2........................ 36,005 20,664 4,606 12,467 1,755 39,027505,098 169,631 121,978 6,486 1,342 24,695 928 1,462 9........................ 32,661 18,658 4,771 12,170 1,776 37,963501,617 162,916 118,125 6,006 1,433 23,958 882 1,081 16........................ 34,070 25,065 4,868 12,679 1.750 36,674502,741 164,356 119,700 6,041 1,506 23,795 777 1,132 23........................ 30,801 23,879 5,026 11,597 1,743 36,402492,850157,737 115,779 6,006 991 21,982 713 1,117 30........................ 30,934 22,073 5,076 11,596 1.751 37,091 493,090 159,507 116,292 6,021 871 23,364 750 1,204 1976 June 2........................ 39,581 16,157 5,224 12,919 2,136 45,165 512,604170,817 124,301 6,004 1,170 24,883 816 1,320 9........................ 31,493 17,941 5,253 11,914 2,110 44,515 502,379 159,538117,830 5,516 1,033 22,130 725 1,095 16........................ 38,233 21,452 5,304 12,563 2.134 44,258514,868174,679 124,164 6,143 5,767 24,393 774 1,140 23........................ 35,963 17,639 5,515 12,755 2.135 43,341 504,252 164,589 119,388 6,304 1,547 23,327 657 1,184 30........................ 39,982 20,645 5,433 14,633 2,179 46,391 521,198 178,773 126,591 6,839 2,737 27,372 854 1,241 July 7........................ 41,460 21,468 4,990 13,827 2,174 47,517 521,157 175,604125,661 6,162 1,805 27,478 961 1,165 14........................ 37,017 21,698 5,444 11,931 2,125 45,705 512,955 168,505 124,278 5,815 1,181 23,377 842 1,172 21........................ 35,535 21,025 5,403 12,723 2,114 44,564509,010 167,352 120,634 5,838 2,585 23,537 742 1,066 28........................ 32,430 21,630 5,505 11,231 2,132 45,219502,249 161,672117,864 5,687 1,884 22,576 727 1,239 New York City 1975 July 2........................ 12,216 6,532 665 5,346 803 14,021 131,498 50,455 28,722 579 157 12,119 569 1,273 9........................ 11,259 6,605 665 5,073 803 13,757 130,560 47,283 26,957 499 167 11,924 522 896 16........................ 11,592 7,720 657 5,715 798 12,978 131,038 48,087 27,277 514 228 12,153 460 894 23........................ 10,798 6,918 674 5,478 801 12,843 127,440 46,383 26,610 543 105 11,243 418 904 30........................ 11,283 6,178 705 4,873 798 13,512128,162 47,585 27,339 561 96 11,695 444 943 1976 June 2........................ 12,621 5,029 775 4,685 938 15,353 129,217 48,244 28,382 511 91 10,467 442 1,096 9........................ 11,201 5,267 740 5,123 936 15,101 126,787 45,230 26,450 484 116 10,326 375 850 16........................ 12,796 5,357 716 4,865 930 14,807 128,299 49,941 27,989 584 1,308 11,590 405 807 23........................ 14,119 3,753 756 6,108 930 14,032 127,526 49,884 27,838 731 186 12,118 326 934 30........................ 14,864 5,098 767 7,030 947 16,212133,073 55,314 30,445 696 469 14,157 500 991 July 7........................ 12,897 7,617 711 5,843 931 16,396 131,278 49,899 28,022 539 161 12,616 552 853 14........................ 13,273 6,588 754 5,016 929 15,894129,466 48,841 28,069 632 109 11,707 451 885 21........................ 13,185 5,577 731 5,565 944 14,923 128,835 49,654 27,887 584 446 11,467 396 796 28........................ 11,440 6,554 756 4,835 945 15,969 125,688 46,399 26,058 571 301 10,968 396 1,015 Outside New York City 1975 July 2........................ 23,789 14,132 3,941 7,121 952 25,006373,600119,176 93,256 5,907 1,185 12,576 359 189 9........................ 21,402 12,053 4,106 7,097 973 24,206371,057 115,633 91,168 5,507 1,266 12,034 360 185 16........................ 22,478 17,345 4,211 6,964 952 23,696371,703 116,269 92,423 5,527 1,278 11,642 317 238 23........................ 20,003 16,961 4,352 6,119 942 23,559365,410 111,354 89,169 5,463 886 10,739 295 213 30........................ 19,651 15,895 4,371 6,723 953 23,579 364,928 111,922 88,953 5,460 775 11,669 306 261 1976 June 2........................ 26,960 11,128 4,449 8,234 1,198 29,812383,387 122,573 95,919 5,493 1,079 14,416 374 224 9........................ 20,292 12,674 4,513 6,791 1,174 29,414375,592 114,308 91,380 5,032 917 11,804 350 245 16........................ 25,437 16,095 4,588 7,698 1.204 29,451 386,569 124,738 96,175 5,559 4,459 12,803 369 333 23........................ 21,844 13,886 4,759 6,647 1.205 29,309376,726 114,705 91,550 5,573 1,361 11,209 331 250 30........................ 25,118 15,547 4,666 7,603 1,232 30,179388,125 123,459 96,146 6,143 2,268 13,215 354 250 July 7........................ 28,563 13,851 4,279 7,984 1,243 31,121 389,879 125,705 97,639 5,623 1,644 14,862 409 312 14........................ 23,744 15,110 4,690 6,915 1,196 29,811 383,489 119,664 96,209 5,183 1,072 11,670 391 287 21........................ 22,350 15,448 4,672 7,158 1,170 29,641 380,175 117,698 92,747 5,254 2,139 12,070 346 270 28........................ 20,990 15,076 4,749 6,396 1,187 29,250376,561 115,273 91,806 5,116 1,583 11,608 331 224 For notes see pp. A-l 8 and A-22. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ WEEKLY REPORTING BANKS A21 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKSA-Continued (In millions of dollars) Deposits (cont.) Borrowings from— Demand (cont.) Time and savings Total Fed­ equity eral Other capital IPC funds liabili­ and sub. For­ Certi­ States pur­ ties, notes/ Wednesday eign fied and Do­ chased, etc.9 deben­ com­ and polit­ mes­ For­ etc. 8 F.R. tures 10 mer­ offi­ Total 7 ical tic eign Banks Other cial cers’ Sav­ Other sub­ inter­ govts.3 banks checks ings divi­ bank sions Large banks— Total 1975 4,721 8,019 224,060 65,881 113,256 22,951 7,928 12,592 49,704 176 3,551 22,338 35,638 .................July 2 4,957 6,474 223,988 66,064 112,973 22,999 7,793 12,683 53,313 34 3,596 22,144 35,6 6 ........................... 9 4,922 6,483 223,522 66,037 112,992 22,982 7,677 12,391 52,153 1,055 3,652 22,468 35,535 ...........................16 4,947 6,202 223,946 65,973 113,626 23,126 7,691 12,081 47,785 1,852 3,740 22,277 35,513 ............................23 5,002 6,003 223,326 65,792 113,552 23,067 7,571 11,954 48,926 21 3,790 21,990 35,530 ...........................30 1976 5,377 6,946 222,692 79,921 105,279 20,885 6,893 8,151 53,750 128 3,740 21,993 39,484 .................June 2 5,307 5,902 223,446 79,864 105,892 20,768 6,943 8,400 53.932 324 3,759 21,867 39,513 ........................... 9 5,365 6,933 222,919 79,639 105,828 20,324 6,962 8,471 52,449 22 3,850 21,551 39,398 ...........................16 4,888 7,294 224,112 79,493 107,275 20,255 6,949 8,455 49.932 764 3,795 21,601 39,459 ...........................23 5,701 7,438 225,469 79,821 108,533 19,946 6,851 8,665 51,168 171 3,712 22,198 39,707 ...........................30 5,950 6,422 224,003 80,055 107,016 19,886 6,523 8,800 55,459 15 3,659 22,712 39.705 .................July 7 5,629 6,211 224,372 80,133 107,089 19,995 6,658 8,813 54,430 970 3,718 21,242 39,718 ...........................14 5,174 7,776 223,780 80,182 106,717 19,972 6,679 8,595 52,813 66 4,012 21,298 39,689 ...........................21 5,350 6,345 223,251 80,195 106,440 20,142 6,490 8,365 52,136 592 3,619 21,273 39.706 ...........................28 New York City 1975 3,385 3,651 47,529 7,504 26,208 1,567 3,444 7,848 14,555 75 1,433 7,639 .................July 2 3,660 2,658 47,649 7,509 26,344 1,595 3,340 7,885 16,703 1,339 7,780 ........................... 9 3,695 2,866 47,532 7,462 26,533 1,631 3,263 7,690 15,607 546 1,397 8,062 ...........................16 3,693 2,867 47,637 7,425 26,821 1,635 3,310 7,497 13,090 1,055 1,495 7,994 ...........................23 3,731 2,776 47,279 7,371 26,625 1,694 3,292 7,379 13,975 1,534 8,028 ...........................30 1976 4,028 3,227 43,100 9,123 23,490 1,333 2,978 5,187 15,354 1.745 9,449 11.325 .................June 2 4,002 2,627 43,215 9,118 23,465 1,336 3,035 5,280 15,437 250 1.745 9,574 11,336 ........................... 9 4,024 3,234 42,823 9,127 23,167 1,190 3,025 5,252 12,949 1,901 9,359 11.326 ...........................16 3,655 4,096 42,892 9,098 23,375 1,209 2,943 5,206 11,981 435 1.746 9,275 11,313 ...........................23 4,251 3,805 42,989 9,010 23,677 1,157 2,846 5,257 11,294 100 1,672 10,359 11,345 ...........................30 4,593 2,563 42,678 9,025 23,316 1,219 2,725 5,341 16,035 1,611 9,700 11,355 .................July 7 4,336 2,652 43,267 9,087 23,641 1,228 2,888 5,398 14,688 548 1,608 9,140 11,374 ...........................14 3,793 4,285 43,042 9,005 23,467 1,263 2,951 5,336 13,626 1,596 9,551 11,366 .............................21 4,009 3,081 42,719 8,996 23,326 1,275 2,880 5,276 13,800 44-i 1,517 9,435 11,377 ...........................28 Outside New York City 1975 1,336 4,368 176,531 58,377 87,048 21,384 4,484 4,744 35,149 101 2,118 14,699 25,826 .................July 2 1,297 3,816 176,339 58,555 86,629 21,404 4,453 4,798 36,610 34 2,257 14,364 25,820 ........................... 9 1,227 3,617 175,990 58,575 86,459 21,351 4,414 4,701 36,546 509 2.255 14,406 25,728 ...........................16 1,254 3,335 176,309 58,548 86,805 21,491 4,381 4,584 34,695 797 2,245 14,283 25,727 ...........................23 1,271 3,227 176,047 58,421 86,927 21,373 4,279 4,575 34,951 21 2.256 13,962 25,769 ...........................30 1976 1,349 3,719 179,592 70,798 81,789 19,552 3,915 2,964 38,396 128 1,995 12,544 28,159 .................June 2 1,305 3,275 180,231 70,746 82,427 19,432 3,908 3,120 38,495 74 2,014 12,293 28,177 ........................... 9 1,341 3,699 180,096 70,512 82,661 19,134 3,937 3,219 39,500 22 1,949 12,192 28,072 ...........................16 1,233 3,198 181,220 70,395 83,900 19,046 4,006 3,249 37,951 329 2,049 12,326 28,146 ...........................23 1,450 3,633 182,480 70,811 84,856 18,789 4,005 3,408 39,874 71 2,040 11,839 28,362 ...........................30 1,357 3,859 181,325 71,030 83,700 18,667 3,798 3,459 39,424 15 2,048 13,012 28,350 .................July 7 1,293 3,559 181,105 71,046 83,448 18,767 3,770 3,415 39,742 422 2.110 12,102 28,344 ...........................14 1,381 3,491 180,738 71,177 83,250 18,709 3,728 3,259 39,187 66 2,416 11,747 28,323 ...........................21 1,341 3,264 180,532 71,199 83,114 18,867 3,610 3,089 38,336 151 2,102 11,838 28,329 ...........................28 For notes see pp. A-l 8 and A-22. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 WEEKLY REPORTING BANKS □ AUGUST 1976 ASSETS AND LIABILITIES OF LARGE COMMERCIAL BANKSA—Continued (In millions of dollars) Memoranda Large negotiable Savings ownership categories time CD’s All other large Total included in time time deposits14 Gross Wednesday Total loans De­ and savings deposits1 Individ­ Part­ liabili­ loans and mand uals ner­ Do­ ties of (gross) invest­ deposits and ships mestic banks ad- ments ad­ non­ and govern­ All to justedn (gross) justed Issued Issued Issued Issued profit cor­ mental other16 their ad­ Total to to Total to to orga­ pora­ units foreign justed11 IPC’s others IPC’s others niza­ tions for branches tions profit Large banks—Total 1975 July 2............................... 285,778 372,630107,589 81,415 54,059 27,356 34,007 17,863 16,144 65,881 1,429 9............................... 288,490 375,574 104,864 81,394 53,840 27,554 33,969 17,955 16,014 66,064 1,809 16............................... 283,751 371,090 104,985 81,003 53,925 27,078 34,151 17,947 16,204 66,037 3,130 23............................... 281,711 369,250 103,963 81,507 54,445 27,062 34,097 17,985 16,112 65,973 2,742 30............................... 281,804368,978 104,338 81,291 54,309 26,982 33,782 17,926 15,856 65,792 2,377 1976 June 2............................... 280,630373,892 105,183 68,440 44,850 23,590 27,654 14,559 13,095 75,714 3.045 1,071 91 2,404 9............................... 280,151 373,501 104,882 69,130 45,402 23,728 27,869 14,717 13,152 75,628 3,069 1,070 97 2,944 16............................... 280,230373,960 106,286 68,736 45,223 23,513 27,890 14,783 13,107 75,452 3,007 1,091 89 4,016 23............................... 278,770370,824 103,752 69,416 46,475 22,941 27,997 14,896 13,101 75,296 3,043 1,061 93 3,784 30............................... 280,017 373,000 108,682 70,555 47,246 23,309 28,082 15,104 12,978 75,845 3.045 854 77 3,674 July 7............................... 279,758 371,447 104,861 68,934 45,735 23,199 28,062 15,102 12,960 76,038 3.085 851 81 3,149 14............................... 279,362372,145 106,930 69,412 45,978 23,434 28,103 15,210 12,893 76,018 3.085 841 189 3,140 21............................... 278,261 370,683 105,695 68,561 45,360 23,201 28,041 15,236 12,805 76,107 3,134 847 94 4,122 28............................... 276,502368,488 104,782 67,897 44,981 22,916 28,169 15,344 12,825 76,082 3,185 833 95 3,884 New York City 1975 July 2............................... 74,531 89,986 25,963 27,929 17,643 10,286 ,389 5,018 3,371 7,504 712 9............................... 75,231 90,473 23,933 28,161 17,895 10,266 ,390 5,020 3,370 7,509 1,052 16............................... 73,213 88,451 24,114 28,253 18,197 10,056 ,362 5,014 3,348 7,462 2,145 23............................... 72,506 87,675 24,237 28,617 18,558 10,059 ,159 4,952 3,207 7,425 1,901 30............................... 72,707 87,915 24,511 28,412 18,366 10,046 ,039 4,926 3,113 7,371 1,390 1976 June 2............................. 69,749 87,394 25,065 24,013 15,474 8,539 5,990 4,092 1,898 8,557 285 219 62 1,865 9............................... 69,532 86.769 23,587 24,177 15,483 8,694 6,012 4,119 1,893 8.529 281 237 71 2,149 16............................. 69,483 86.770 24,247 23,646 15,117 8,529 6,125 4.166 1,959 8,518 277 270 62 3,201 23............................... 68,331 84,769 23,461 23,763 15,334 8,429 6,034 4,081 1,953 8,479 285 268 66 2.830 30............................... 68,681 85,923 25,824 23,794 15,444 8,350 6,083 4.167 1,916 8.530 283 148 49 2\651 July 7............................... 68,748 85,389 24,225 23,513 15,143 8,370 6,129 4,195 1,934 8,538 283 155 49 2.090 14............................... 68,452 85,507 23,752 24,119 15,465 8,654 6,081 4,240 1,841 8,497 277 163 150 2.324 21............................... 67,763 84,816 24,556 23,980 15,246 8,734 6,032 4,236 1,796 8,492 281 166 66 3i 204 28............................... 66,377 83,143 23,690 23,730 15,147 8,583 6,001 4,231 1,770 8,473 294 164 65 3;060 Outside New York City 1975 July 2............................... 211,247 282,644 81,626 53,486 36,416 17,070 25,618 12,845 12,773 58,377 717 9............................... 213,259 285,101 80,931 53,233 35,945 17,288 25,579 12,935 12,644 58,555 757 16............................... 210,538 282,639 80,871 52,750 35,728 17,022 25,789 12,933 12,856 58,575 985 23............................... 209,205 281,575 79,726 52,890 35,887 17,003 25,938 13,033 12,905 58,548 841 30............................... 209,097 281,063 79,827 52,879 35,943 16,936 25,743 13,000 12,743 58,421 987 1976 June 2............................. 210,881 286,498 80,118 44,427 29,376 15,051 21,664 10,467 11,197 67,157 2,760 852 539 9............................. 210,619 286,732 81,295 44,953 29,919 15,034 21,857 10,598 11,259 67,099 2,788 833 795 16............................. 210,747287,190 82,039 45,090 30,106 14,984 21,765 10,617 11.148 66,934 2,730 821 815 23............................. 210,439286,055 80,291 45,653 31,141 14,512 21,963 10,815 11.148 66,817 2,758 793 954 30............................. 211,336287,077 82,858 46,761 31,802 14,959 21,999 10,937 11,062 67,315 2,762 706 1,023 July 7............................. 211,010286,058 80,636 45,421 30,592 14,829 21,933 10,907 11,026 67,500 2,802 696 1,059 14............................. 210,910286,638 83,178 45,293 30,513 14,780 22,022 10,970 11,052 67,521 2,808 678 816 21............................. 210,498285,867 81,139 44,581 30,114 14,467 22,009 11,000 11,009 67,615 2,853 681 918 28............................. 210,125 285,345 81,092 44,167 29,834 14,333 22,168 11,113 11,055 67,609 2,891 669 824 A See p. A-l 8. 11 Exclusive of loans and Federal funds transactions with domestic 1 Loan loss reserve and unearned income on loans had been reported commercial banks. as liability items through Mar. 24, 1976. Since then the item is netted 12 All demand deposits except U.S. Govt, and domestic commercial against total loans, and therefore against total assets also. As a proxy for banks, less cash items in process of collection. this item prior to Mar. 31, 1976, reserves for loans have been used to 13 Certificates of deposit issued in denominations of $100,000 or more. calculate year-ago figures. 14 All other time deposits issued in denominations of $100,000 or more 2 Includes securities purchased under agreements to resell. (not included in large negotiable CD’s). 3 Includes official institutions and so forth. 15 Other than commercial banks. 16 Domestic and foreign com­ 4 Includes short-term notes and bills. mercial banks, and official international organizations. 5 Federal agencies only. 6 Includes corporate stocks. Note.—Effective Mar. 24, 1976, reclassification of loans in Chicago 7 Includes U.S. Govt, and foreign bank deposits, not shown separately. resulted in the following major revisions: commercial and industrial, 8 Includes securities sold under agreements to repurchase. — $675 million; other nonbank financial institutions, —$185 million; 9 Includes minority interest in consolidated subsidiaries. Beginning real estate, $580 million. These reclassifications are not reflected in Mar. 31, 1976, also includes deferred tax portion of reserves for loans. data prior to Mar. 24, 1976. 10 Includes reserves for securities. Beginning Mar. 31, 1976, also includes contingency portion of reserves for loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ BUSINESS LOANS OF BANKS A23 COMMERCIAL AND INDUSTRIAL LOANS OF LARGE COMMERCIAL BANKS (In millions of dollars) Outstanding Net change during- 1976 1976 1976 1975 1976 1975 Industry July July July July June 1st 2nd 28 21 14 7 30 July June May II I IV half half Durable goods manufacturing: Primary metals................................. 2,023 2,052 2,059 2,090 2,098 -75 -7 51 73 -48 62 25 50 Machinery........................................ 4,880 4,923 4,967 5,018 5,034 -154 -199 -13 -429 -296 -781 -725 - 1,668 Transportation equipment............... 2,565 2,629 2,666 2,675 2,676 -111 29 -143 -317 -52 -267 -369 -465 Other fabricated metal products... 1,713 1,727 1,743 1,720 1,744 -31 -36 -80 -142 -87 -473 -229 -750 Other durable goods........................ 3,499 3,535 3,576 3,575 3,612 -113 101 -68 106 53 -514 159 -688 Nondurable goods manufacturing: Food, liquor, and tobacco.............. 3,400 3,420 3,378 3,441 3,363 37 323 -118 92 -509 455 -417 468 Textiles, apparel, and leather.......... 3,396 3,422 3,409 3,395 3,320 76 171 r41 234 r395 -477 629 -532 Petroleum refining........................... 2,240 2,249 2,324 2,354 2,300 -60 -72 31 76 -138 -234 -62 -116 Chemicals and rubber..................... 2,546 2,575 2,537 2,539 2,484 62 -23 -95 -167 -40 -178 -207 -431 Mi O ni t n h g e , r n i o nc n l d u u d r i a n b g l e c g ru o d o e d s p .. e .. t . r .. o .. l . e .. u .. m ... 1,929 1,932 1,929 1,923 1,917 12 38 r_47 19 '90 -268 109 -415 and natural gas............................. 6,592 6,595 6,554 6,578 6,667 -75 57 124 266 448 789 714 1,065 Trade: Commodity dealers................. 1,519 1,529 1,657 1,652 1,769 -250 102 124 122 65 340 187 477 Other wholesale....................... 5,974 5,925 5,862 5,866 5,838 136 67 r —19 42 r357 -103 399 -181 Retail........................................ 6,178 6,258 6,205 6,139 6,306 -128 190 128 381 133 -208 514 -517 Transportation..................................... 5,344 5,369 5,461 5,524 5,681 -337 -113 -36 -156 -231 127 -387 3 Communication.................................... 1,623 1,650 1,652 1,762 1,753 -130 37 63 58 -289 -49 -231 -158 Other public utilities............................ 6,202 6,297 6,209 6,253 6,225 -23 162 123 113 r —885 33 -772 -198 Construction........................................ 4,247 4,247 4,194 4,223 4,241 6 6 -122 -178 r—706 -381 -884 -436 Services................................................. 10,404 10,412 10,335 10,402 10,585 -181 -31 r —143 -303 69 285 -234 -15 All other domestic loans..................... 7,323 7,355 7,368 7,338 7,070 253 -173 — 339 -767 »•- 2,566 628 -3,333 643 Bankers acceptances............................. 2,698 2,878 2,883 2,824 2,958 -260 86 —245 -344 -1,643 2,855 -1,987 2,685 Foreign commercial and industrial loans.............................................. 5,481 5,466 5,502 5,600 5,676 -195 -37 63 306 82 222 388 757 Total classified loans........................... 91,776 92,445 92,470 92,891 93,317 -1,541 678 r—720 -915 r -5,798 1,863 -6,713 -422 Comm, paper included in total clas­ sified loans1................................... 389 468 — 79 112 -100 24 7 153 31 197 Total commercial and industrial loans of large commercial banks.......... 111,324112,051 112,140112,420112,903 -1,579 883 r —545 -764 r-6,987 1,680 -7,751 -942 For notes see table below. “TERM” COMMERCIAL AND INDUSTRIAL LOANS OF LARGE COMMERCIAL BANKS (In millions of dollars) Outstanding Net change during— Industry 1976 1975 1976 1975 1976 July June May Apr. Mar. Feb. Jan. Dec. Nov. 1st 28 30 26 28 31 25 28 31 26 II I IV III half Durable goods manufactur­ ing: Primary metals................... 1,191 1,241 1,293 1,283 1,291 1,335 1,341 1,372 1,381 -50 -81 34 50 -131 Machinery.......................... 2,901 3,029 3,088 3,055 3,144 3,072 3,117 3,313 3,451 -115 -169 -424 -240 -284 Transportation equipment. 1,399 1,505 1,488 1,632 1,691 1,643 1,686 1,615 1,727 -186 76 -78 -47 -110 Other fabricated metal products.......................... 767 799 879 919 909 1,035 1,041 1,024 1,087 -110 -115 -244 46 -225 Other durable goods.......... 1,763 1,815 1,843 1,871 1,793 1,838 1,874 1,823 1,905 22 -30 -189 -78 -8 Nondurable goods manufac­ turing: Food, liquor, and tobacco. 1,444 1,403 1,334 1,366 1,391 1,536 1,547 1,578 1,544 12 -187 107 -43 -175 Textiles, apparel, and leather............................. 1,123 1,116 1,075 1,044 993 1,055 1,032 995 1,072 123 -2 -108 8 121 Petroleum refining............. 1,658 1,706 1,781 1,785 1,685 1,886 1,859 1,831 1,860 21 -146 -136 258 -125 Chemicals and rubber....... 1,444 1,466 1,462 1,495 1,540 1,603 1,588 1,622 1,549 -74 -82 -43 -97 -156 Other nondurable goods.. 982 986 961 979 962 942 925 888 955 24 74 -168 -87 98 Mining, including crude pe­ troleum and natural gas. 5,092 5,194 5,117 5,015 4,904 4,731 4,528 4,484 3,867 290 420 637 113 710 Trade: Commodity dealers.. 194 207 206 180 190 182 196 172 168 17 18 22 2 35 Other wholesale........ 1,307 1,308 1,355 1,312 1,344 1,279 1,290 1,276 1,308 -36 68 -43 -10 32 Retail......................... 2,057 2,030 2,031 2,036 2,008 1,987 2,007 1,996 2,115 22 12 -157 17 34 Transportation....................... 4,030 4,235 4,246 4,252 4,250 4,329 4,291 4,390 4,324 -15 -140 -1 -34 -155 Communication..................... 936 989 1,008 984 998 1,095 1,101 1,081 1,112 -9 -83 -51 -1 -92 Other public utilities............. 3,895 3,908 3,811 3,770 3,898 3,940 3,995 3,979 3,942 10 -81 13 -79 -71 Construction.......................... 1,690 1,744 1,755 1,876 1,915 2,141 2,258 2,181 2,207 -171 -266 -178 45 -437 Services................................... 4,949 5,098 r5,240 5,317 5,368 5,147 5,038 5,135 5,082 -270 233 13 -18 -37 All other domestic loans .... 2,429 2,364 2,349 2,507 2,700 3,093 3,396 3,299 3,116 -336 -599 55 -14 -935 Foreign commercial and in­ dustrial loans.................. 3,141 3,157 3,121 3,085 2,984 3,001 2,999 2,921 2,851 173 63 158 169 236 Total loans............................. 44,392 45,300 r45,443 45,763 45,958 46,870 47,109 46,975 46,623 -658 -1,017 -781 -40 -1,675 1 Reported the last Wednesday of each month. Commercial and industrial “term” loans are all outstanding loans with Note.—For description of series see article “Revised Series on Com- an original maturity of more than 1 year and all outstanding loans granted mercial and Industrial Loans by Industry,” Feb. 1967 Bulletin, p. 209. under a formal agreement—revolving credit or standby—on which the original maturity of the commitment was in excess of 1 year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 DEMAND DEPOSIT OWNERSHIP d AUGUST 1976 GROSS DEMAND DEPOSITS OF INDIVIDUALS, PARTNERSHIPS, AND CORPORATIONS1 (In billions of dollars) Type of holder Total Class of bank, and quarter or month deposits, 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 IPC All insured commercial banks: 1970—Dec.................................................................................. 17.3 92.7 53.6 1.3 10.3 175.1 1971 Dec.................................................................................. 18.5 98.4 58.6 1.3 10.7 187.5 1972 Dec.................................................................................. 18.9 109.9 65.4 1.5 12.3 208.0 1973—June................................................................................ 18.6 106.6 67.3 2.0 11.8 206.3 Sept................................................................................. 18.8 108.3 69.1 2.1 11.9 210.3 Dec.................................................................................. 19.1 116.2 70.1 2.4 12.4 220.1 1974—Mar................................................................................. 18.9 108.4 70.6 2.3 11.0 211.2 June................................................................................ 18.2 112.1 71.4 2.2 11.1 215.0 Sept................................................................................. 17.9 113.9 72.0 2.1 10.9 216.8 Dec................................................................................. 19.0 118.8 73.3 2.3 11 .7 225.0 1975—Mar................................................................................. 18.6 111.3 73.2 2.3 10.9 216.3 June................................................................................ 19.4 115.1 74.8 2.3 10.6 222.2 Sept................................................................................. 19.0 118.7 76.5 2.2 10.6 227.0 Dec................................................................................. 20.1 125.1 78.0 2.4 11.3 236.9 1976—Mar................................................................................ 19.9 116.9 77.2 2.4 11.4 227.9 June*.............................................................................. 20.3 121.9 78.8 2.5 11.2 234.6 Weekly reporting banks: 1971—Dec................................................................................. 14.4 58.6 24.6 1.2 5.9 104.8 1972 Dec................................................................................. 14.7 64.4 27.1 1.4 6.6 114.3 1973 Dec................................................................................. 14.9 66.2 28.0 2.2 6.8 118.1 1974 Dec................................................................................. 14.8 66.9 29.0 2.2 6.8 119.7 1975—June................................................................................ 15.1 65.1 29.5 2.2 6.2 118.1 July................................................................................. 15.0 65.3 29.8 2.2 6.5 118.7 Aug................................................................................. 14.4 64.6 29.1 2.0 5.9 116.1 Sept................................................................................. 14.7 65.5 29.6 2.1 6.2 118.1 15.1 66.7 29.0 2.2 6.3 119.3 15.4 68.1 29.4 2.2 6.4 121.6 Dec................................................................................. 15.6 69.9 29.9 2.3 6.6 124.4 1976—Jan.................................................................................. 15.2 68.0 30.3 2.2 6.7 122.4 Feb................................................................................. 15.3 65.6 29.2 2.2 6.4 r118.7 Mar................................................................................. 15.4 65.2 30.8 1.8 6.2 119.5 Apr................................................................................. 15.1 65.5 33.6 1.8 6.0 122.0 15.7 67.8 26.4 2.2 6.1 118.2 June*.............................................................................. 16.1 67.4 31.2 2.0 6.0 122.6 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, June 30, Dec. 31, Class of Dec. 31, Dec. 31, June 30, Dec. 31, bank 1973 1974 1975 1975 bank 1973 1974 1975 1975 All commercial......................... 507 389 338 280 All member—Cont. Insured................................... 503 387 335 280 Other large banks 1........... 58 69 74 76 National member.................. 288 236 223 188 All other member 1............ 294 206 186 146 State member........................ 64 39 36 35 All nonmember...................... 155 115 79 58 All member............................... 352 275 260 223 152 112 76 58 Noninsured......................... 3 3 3 1 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 is, 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-l 4; member” parallel the previous “Reserve City” (other than in New York from the figures for weekly reporting banks as shown on pp. A-l 8-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-l 3. But they are included in the figures for “Time de­ posits” 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

AUGUST 1976 o LOAN SALES BY BANKS; OPEN MARKET PAPER A25 LOANS SOLD OUTRIGHT BY LARGE COMMERCIAL BANKS (Amounts outstanding; in millions of dollars) To selected related institutions1 Bytype of loail Date Total Commercial Real All and estate other industrial 1976—Apr. 7......................... 4,050 2,459 195 1,396 14......................... 4,082 2,480 197 1,405 21......................... 4,121 2,531 194 1,396 28......................... 4,176 2,560 200 1,416 May 5......................... 4,174 2,567 195 1,412 12......................... 4,346 2,727 193 1,426 19......................... 4,307 2,704 192 1,411 26........................ 4,356 2,707 205 1,444 June 2......................... 4,432 2,757 204 1,471 1 To bank’s own foreign branches, nonconsolidated non­ 9......................... 4,424 2,767 205 1,452 bank affiliates of the bank, the bank’s holding company (if 16......................... 4,478 2,839 205 1,434 not a bank), and nonconsolidated nonbank subsidiaries of 23....................... 4,442 2,810 205 1,427 the holding company. 30 '....................... 4,491 2,837 206 1,448 Note.—Series changed on Aug. 28,1974. For a comparison July 7......................... 4,529 2,875 205 1,449 of the old and new data for that date, see p. 741 of the Oct. 14......................... 4,519 2,840 199 1,480 1974 Bulletin. Revised figures received since Oct. 1974 21......................... 4,550 2,839 194 1,517 that affect that comparison are shown in note 2 to this table 28......................... 4,528 2,822 209 1,497 in the Dec. 1974 Bulletin, p. A-27. COMMERCIAL PAPER AND BANKERS ACCEPTANCES OUTSTANDING (In millions of dollars) Commercial paper Dollar acceptances Financial Bank-related 5 Held by— Based on- End comoanies1 of Non­ period All finan­ Accepting banks F.R. Banks issuers cial Total Im- Ex­ Dealer- Di­ com­ Dealer- Di­ Others ports ports All placed2 rectly- panies4 placed rectly- For­ into from other placed 3 placed Total Own Bills Own eign United United bills bought acct. corr.6 States States 196 6 13,645 2,332 10,556 757 3,603 1,198 983 215 193 191 2,022 997 829 1,778 196 7 17,085 2,790 12,184 2,111 4,317 1,906 1,447 459 164 156 2,090 1,086 989 2,241 196 8 21,173 4,427 13,972 2,774 4,428 1,544 1,344 200 58 109 2,717 1,423 952 2,053 196 9 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 1,153 2,408 1970........... 33,071 5,514 20,424 7,133 352 1,997 7,058 2,694 1,960 735 57 250 4,057 2,601 1,561 2,895 1971........... 32,126 5,297 20,582 6,247 524 1,449 7,889 3,480 2,689 791 261 254 3,894 2,834 1,546 3,509 1972........... 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 2,458 1973........... 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 3,120 1974........... 49,144 4,611 31,839 12,694 1,814 6,518 18,484 4,226 3,685 542 999 1,109 12,150 4,023 4,067 10,394 1975-May.. 51,317 5,889 32,821 12,607 1,543 7,096 18,108 4,450 3,892 558 865 234 12,559 3,665 4,186 10,257 June.. 48,765 5,604 31,115 12,045 1,561 7,230 17,740 4,774 4,224 550 682 319 11,965 3,466 4,080 10,193 July.. 49,352 6,018 31,263 12,072 1,649 7,038 16,930 4,778 4,275 503 685 329 11,138 3,474 3,865 9,591 Aug.. 49,810 5,645 32,172 11,993 1,511 7,392 16,456 4,546 3,988 558 840 304 10,766 3,305 3,806 9,344 Sept.. 48,257 5,574 30,496 12,187 1,482 7,316 16,790 5,002 4,190 812 948 302 10,538 3,313 3,783 9,693 Oct... 50,394 6,360 32,308 11,726 1,634 7,114 17,304 5,213 4,288 924 1,047 284 10,760 3,467 3,947 9,890 Nov.. 49,512 6,389 32,003 11,120 1,715 6,974 17,875 6,497 5,684 813 727 279 10,372 3,545 3,888 10,443 Dec.. 47,690 6,239 31,276 10,175 1,762 6,892 18,727 7,333 5,899 1,435 1,126 293 9,975 3,726 4,001 11,000 1976-Jan... 48,858 6,072 31,305 11,481 1,657 6,918 18,677 6,294 5,367 927 1,230 248 10,904 3.891 3,906 10,880 Feb... 49,927 6,401 31,534 11,992 1,567 6,753 19,060 5,950 5,255 695 1,051 231 11,827 3; 977 4,039 11,044 Mar. . 49,300 6,428 31,239 11,633 1,654 6,773 18,901 6,340 5,651 689 883 245 11,433 4,027 4,193 10,681 Apr... 49,572 6,246 31,143 12,183 1,658 6,304 c19,559 6,126 5,305 821 995 344 12,094 4,258 c4,258 11,043 May.. 50,539 6,443 31,867 12,229 1,724 5,974 19,511 6,050 5,271 778 875 440 12,147 4,143 4,258 11,110 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, manufac­ sales, 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

A26 INTEREST RATES □ AUGUST 1976 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 10% 1975—July 18................... 7% 1975—Jan. 10.05 19 10% 15 10 28................... 7% Feb. 8.96 25 10% 20 9% Mar. 7.93 28 9% Aug. 12................... 7% Apr. 7.50 May 2 10* May 7.40 6 Feb. 3, 9% Sept. 15................... 8 June 7.07 10 11% 10, 9 July 7.15 17 11% 18, 8% Oct. 27................... 7% Aug. 7.66 24, 8% Sept. 7.88 June 26 11% Nov. 5................... 7% Oct. 7.96 Mar. 5, 8% Nov. 7.53 July 5 12 10, 8 Dec. 2................... 7% Dec. 7.26 18, 7% Oct. 7 11% 24, 7% 1976—Jan. 12................... 7 1976—Jan. 7.00 21 11% 6% Feb. 6.75 28 11% May 20, 7% Mar. 6.75 June 1................... 7 Apr. 6.75 Nov. 4 11 June 9, 7 7.................... 7% May 6.75 14 10% June 7.20 25 10% Aug. 7 July 7.25 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 May Feb. May Feb. May Feb. May Feb. May Feb. May Feb. 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 Short-term 35 centers..................................... 7.44 7.54 8.91 9.03 8.38 8.44 7.78 7.80 7.52 7.55 7.18 7.33 New York City........................ 6.99 7.14 8.84 8.64 8.29 8.20 7.65 7.52 7.29 7.40 6.83 7.03 7 Other Northeast................... 7.79 7.93 9.24 9.46 8.58 8.69 7.99 8.06 7.95 7.77 7.45 7.71 8 North Central....................... 7.44 7.50 8.39 8.51 8.21 8.21 7.62 7.63 7.46 7.50 7.29 7.37 7 Southeast............................... 7.66 7.86 9.20 9.44 8.65 8.78 7.84 8.16 7.20 7.62 7.25 7.29 8 Southwest.............................. 7.51 7.56 8.75 8.76 8.13 8.16 7.71 7.57 7.48 7.44 7.11 7.35 4 West Coast............................ 7.75 7.77 9.14 9.17 8.51 8.60 8.00 8.06 7.71 7.70 7.61 7.61 Revolving credit 35 centers................................... 7.36 7.50 9.23 9.50 8.12 8.40 7.59 7.79 7.35 7.74 7.32 7.42 New York City......................... 7.42 7.51 8.56 7.73 8.31 7.49 7.68 7.29 7.46 7.43 7.50 7 Other Northeast................... 7.78 8.06 "8.‘ 92" 10.66 7.84 7.57 7.44 7.47 7.58 7.80 7.83 8.16 8 North Central....................... 7.48 7.64 9.19 9.88 8.69 9.23 7.99 8.34 7.74 7.46 7.34 7.53 7 Southeast............................... 8.01 7.49 9.85 9.59 8.95 9.02 8.35 8.09 8.15 8.43 7.69 6.75 8 Southwest.............................. 7.50 7.73 8.93 8.81 8.23 8.14 7.67 7.89 7.23 8.02 7.48 7.49 4 West Coast............................ 7.15 7.32 8.61 8.69 7.84 8.15 7.39 7.59 7.14 7.87 7.12 7.20 Long-term 35 centers..................................... 8.02 8.02 9.21 9.44 8.80 8.96 8.16 8.40 8.33 8.26 7.92 7.89 New York City........................ 7.85 7.68 7.68 7.43 8.45 8.08 8.45 8.01 8.51 7.25 7.76 7.68 7 Other Northeast................... 7.35 8.16 9.10 9.36 9.19 9.32 8.52 8.38 8.10 8.10 6.64 7.98 8 North Central....................... 8.59 7.96 8.38 9.23 8.28 8.56 7.94 8.35 9.08 7.90 8.65 7.86 7 Southeast............................... 8.03 8.90 9.49 9.69 8.90 9.69 7.70 9.20 7.75 7.97 8.01 8.57 8 Southwest.............................. 7.89 8.14 10.53 10.65 8.92 8.69 8.40 8.10 7.64 8.79 7.74 7.84 4 West Coast............................ 8.23 8.46 9.43 8.63 8.97 9.33 7.73 8.85 8.29 9.12 8.26 8.28 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 o INTEREST RATES A27 MONEY MARKET RATES (Per cent per annum) U.S. Government securities 5 Prime Finance commercial CO. Prime Fed­ Period paper1 paper bankers’ eral 3-month bills6 6-month bills « 9- to 12-month issues placed accept­ funds 3- to 5directly, ances, rate4 year 90-119 4 to 6 3 to 6 90 days 3 Rate Market Rate Market 1-year issues 7 days months months2 on new yield on new yield bill (mar­ Other 7 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 1975. 6.26 6.33 6.16 6.30 5.82 5.838 5.80 6.122 6.11 6.30 6.70 7.55 1975—July.. 6.32 6.44 6.02 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 Nov.. 5.78 5.91 5.79 5.79 5.22 5.468 5.48 5.751 5.80 6.07 6.40 7.51 Dec.. 5.88 5.97 5.86 5.72 5.20 5.504 5.44 5.933 5.85 6.16 6.51 7.50 1976—Jan... 5.15 5.27 5.16 5.08 4.87 4.961 4.87 5.238 5.14 5.44 5.71 7.18 Feb.. 5.13 5.23 5.09 4.99 4.77 4.852 4.88 5.144 5.20 5.53 5.78 7.18 Mar.. 5.25 5.37 5.27 5.18 4.84 5.047 5.00 5.488 5.44 5.82 6.12 7.25 Apr.. 5.08 5.23 *■5.14 5.03 4.82 4.878 4.86 5.201 5.18 5.54 5.85 6.99 May. 5.44 5.54 5.38 5.53 5.29 5.185 5.20 5.600 5.62 5.98 6.36 7.35 June. 5.83 5.94 5.78 5.77 5.48 5.443 5.41 5.784 5.77 6.12 6.52 7.40 July., 5.54 5.67 5.53 5.50 5.31 5.278 5.23 5.597 5.53 5.82 6.21 7.24 Week ending- 1976—Apr. 5.15 5.30 5.13 5.10 4.84 4.929 4.97 5.327 5.34 5.76 6.03 7.14 5.18 5.38 5.18 5.05 4.73 4.957 4.91 5.293 5.22 5.59 5.94 7.04 5.09 5.19 '5.13 5.01 4.77 4.830 4.80 5.068 5.04 5.36 5.66 6.88 5.00 5.13 5.13 4.94 4.78 4.763 4.78 5.089 5.11 5.47 5.76 6.92 May 1. 5.03 5.15 5.13 5.07 4.93 4.909 4.88 5.230 5.24 5.61 5.90 7.04 8. 5.20 5.30 5.15 5.21 5.03 4.921 4.91 5.339 5.30 5.68 5.98 7.11 15. 5.30 5.43 5.30 5.39 5.02 5.072 5.11 5.426 5.51 5.89 6.21 7.28 22. 5.53 5.63 5.45 5.67 5.28 5.250 5.33 5.726 5.79 6.11 6.56 7.46 29. 5.73 5.83 5.63 5.87 5.50 5.495 5.47 5.908 5.89 6.26 6.68 7.56 June 5.88 6.00 >•5.78 5.92 5.54 5.578 5.53 5.952 5.90 6.27 6.66 7.52 5.88 6.00 5.88 5.82 5.44 5.459 5.44 5.768 5.75 6.11 6.55 7.42 5.90 6.00 5.88 5.74 5.47 5.380 5.38 5.695 5.74 6.07 6.50 7.38 5.78 5.90 5.75 5.69 5.48 5.356 5.34 5.722 5.71 6.0 6 6.44 7.32 July 5.70 5.80 5.50 5.69 5.58 5.368 5.36 5.754 5.75 6.08 6.46 7.36 5.72 5.81 5.63 5.66 5.37 5.412 5.34 5.768 5.61 5.90 6.35 7.30 5.53 5.65 5.53 5.48 5.27 5.190 5.15 5.430 5.44 5.72 6.13 7.18 5.48 5.65 5.50 5.47 5.30 5.226 5.23 5.536 5.54 5.84 6.17 7.26 5.38 5.50 5.50 5.34 5.28 5.194 5.17 5.497 5.45 5.74 6.12 7.21 1 Averages of the most representative daily offering rate quoted by rates. Prior to this date, the daily effective rate was the rate considered dealers. most representative of the day’s transactions, usually the one at which 2 Averages of the most representative daily offering rate published by most transactions occurred. finance companies, for varying maturities in the 90-179 day range. 5 Except for new bill issues, yields are averages computed from daily 3 Beginning Aug. 15, 1974, the rate is the average of the midpoint of closing bid prices. the range of daily dealer closing rates offered for domestic issues; prior 6 Bills quoted on bank-discount-rate basis. data are averages of the most representative daily offering rate quoted by 7 Selected note and bond issues. dealers. 4 Seven-day averages of daily effective rates for week ending Wednesday. Since July 19, 1973, the daily effective Federal funds rate is an average of Note.—Figures for Treasury bills are the revised series described on p. the rates on a given day weighted by the volume of transactions at these A-35 of the Oct. 1972 Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 INTEREST RATES □ AUGUST 1976 BOND AND STOCK YIELDS (Per cent per annum) Government bonds Corporate bonds Stocks State and local Aaa utility By selected By Dividend/ Earnings/ ratine group price ratio price ratio Period Uni•t ccJi Total 1 States (long­ Re­ Aaa Baa Indus­ Rail­ Public term) Total i Aaa Baa New cently trial road utility Pre­ Com­ Com­ issue 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 1975.......... 6.98 7.05 6.42 7.62 9.40 9.41 9.46 8.83 10.39 9.25 9.39 9.88 8.38 4.31 9.03 1975—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 9.12 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 Nov.. 7.21 7.41 6.64 8.08 9.20 9.26 9.44 8.78 10.33 9.27 9.36 9.83 8.50 4.07 Dec.. 7.17 7.29 6.50 7.96 9.36 9.21 9.45 8.79 10.35 9.26 9.37 9.87 8.57 4.14 1976—Jan 6.94 7.08 6.22 7.81 8.70 8.79 9.33 8.60 10.24 9.16 9.32 9.68 8.16 3.80 8.22 Feb,. 6.92 6.94 6.04 7.76 8.63 8.63 9.23 8.55 10.10 9.12 9.25 9.50 8.00 3.67 Mar., 6.87 6.90 5.99 7.72 8.62 8.61 9.18 8.52 9.99 9.10 9.16 9.43 8.07 3.65 Apr.. 6.73 6.61 5.68 7.50 8.48 8.52 9.04 8.40 9.83 8.98 9.05 9.27 8.04 3.66 May. 6.99 6.85 5.88 7.75 8.82 8.77 9.06 8.58 9.76 9.00 8.96 9.31 8.06 3.76 June. 6.92 6.83 5.85 7.75 8.72 8.73 9.05 8.62 9.72 8.96 8.88 9.36 8.10 3.75 July. 6.85 6.71 5.71 7.64 8.63 8.63 8.97 8.56 9.63 8.90 8.81 9.26 3.64 Week ending— 1976—June 5.. 6.98 6.88 5.90 7.79 8.83 8.80 9.08 8.63 9.76 9.03 8.93 9.37 8.13 3.79 12.. 6.92 6.83 5.85 7.74 8.71 8.76 9.06 8.63 9.75 8.97 8.91 9.38 8.14 3.86 19.. 6.91 6.81 5.83 7.73 8.69 8.70 9.04 8.62 9.71 8.94 8.88 9.36 8.04 3.74 26.. 6.91 6.79 5.81 7.72 8.74 9.02 8.60 9.68 8.93 8.84 9.36 8.10 3.70 July 3.. 6.90 6.79 5.81 7.72 8.72 8.67 9.03 8.63 9.70 8.95 8.82 9.35 8.09 3.67 10.. 6.86 6.74 5.75 7.66 8.58 8.57 8.99 8.57 9.68 8.92 8.79 9.32 8.09 3.62 17.. 6.83 6.71 5.70 7.64 8.53 8.55 8.96 8.53 9.63 8.90 8.79 9.26 8.10 3.57 24.. 6.86 6.69 5.67 7.62 8.66 8.68 8.95 8.55 9.60 8.88 8.81 9.24 8.07 3.64 31.. 6.85 6.64 5.62 7.58 8.72 8.69 8.95 8.55 9.61 8.88 8.82 9.21 8.05 3.73 Number of issues2.. , 15 20 5 5 121 20 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: 1 Standard and Poor’s corporate series. Effective July 1976, Standard 1 Margin credit includes all credit extended to purchase or carry stocks and Poor added a new financial group, including banks and insurance or related equity instruments and secured at least in part by stock (Dec. companies, to the index. Stocks in this revised group are 400 industrials 1970 Bulletin, p. 920). Credit extended by brokers is end-of-month data (formerly 425), 20 transportation (formerly 15 rail), 40 public utility for member firms of the New York Stock Exchange. June data for banks (formerly 60), and 40 financial. are universe totals; all other data for banks represent estimates for all commercial banks based on reports by a reporting sample, which ac­ Note.—Annual data are averages of daily or weekly figures. Monthly counted for 60 per cent of security credit outstanding at banks on June 30, and weekly data are averages of daily figures unless otherwise noted and are 1971. computed as follows: U.S. Govt, bonds, derived from average market 2 In addition to assigning a current loan value to margin stock generally, yields in table on p. A-28 on basis of an assumed 3 per cent, 20-year Regulations T and U permit special loan values for convertible bonds and bond. Municipal and corporate bonds, derived from average yields as stock acquired through exercise of subscription rights. computed by Standard and Poor’s Corp., on basis of a 4 per cent, 20- 3 Nonmargin stocks are those not listed on a national securities exchange year bond; Wed. closing prices. Common stocks, derived from com­ and not included on the Federal Reserve System’s list of over the counter ponent common stock prices. Average daily volume of trading, presently margin stocks. At banks, loans to purchase or carry nonmargin stocks are conducted 5 days per week for 6 hours per day. 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

AUGUST 1976 □ SECURITY MARKETS A29 SECURITY PRICES Common stock prices Volume of trading in Bond prices New York Stock Exchange Amer­ stocks (per cent of par) ican (thousands Stock of shares) Period Standard and Poor’s index New York Stock Exchange index Ex­ (1941-43=10) (Dec. 31, 1965= 50) change total index U.S. State Cor­ Trans­ Trans- (Aug. Govt. and po­ Total Indus­ porta­ Public Fi­ Total Indus­ por- Utility Fi­ 31, NYSE AMEX (long­ local rate trial tion utility nance trial ta- nance 1973= term) AAA tion 100) 197 0 60.52 72.3 61.6 83.22 91.29 54.48 45.72 48.03 32.14 37.24 54.64 96.63 10,532 3,376 197 1 67.73 80.0 65.0 98.29 108.35 59.33 54.22 57.92 44.35 39.53 70.38 113.40 15,381 4,234 197 2 68.71 84.4 65.9 109.20 121.79 56.90 60.29 65.73 50.17 38.48 78.35 129.10 16,487 4,447 197 3 62.80 85.4 63.7 107.43 120.44 53.47 57.42 63.08 37.74 37.69 70.12 103.80 16.374 3,003 197 4 57.45 76.3 58.8 82.85 92.91 38.91 43.84 48.08 31.89 29.82 49.67 79.97 13,883 1,908 197 5 57.44 68.9 56.2 85.17 96.15 41.21 45.73 51.88 30.73 31.45 46.62 83.15 18,568 2,150 1975—Jul y 58.09 68.5 56.6 92.49 103.84 43.67 49.54 54.96 32.90 32.98 52.51 93.28 20,076 2,750 Aug.......... 56.84 68.3 55.6 85.71 96.21 41.04 45.71 50.71 30.08 31.02 46.55 85.74 13,404 1,476 Sept.......... 55.23 66.1 55.8 84.62 94.96 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 42.59 46.87 52.26 30.79 31.87 44.36 83.46 15,893 1,629 Nov.......... 55.77 66.2 56.3 90.07 100.86 43.77 47.64 52.91 32.09 32.99 45.10 85.60 16.795 1,613 Dec........... 56.03 67.4 56.1 88.74 94.89 43.25 46.78 51.89 31.61 32.75 43.86 82.50 15,859 1,977 1976—Ja..............n 57.75 69.7 57.0 96.86 108.45 46.99 51.31 57.00 35.78 35.23 48.83 91.47 32,794 3,070 Feb........... 57.86 68.8 57.1 100.64 113.43 47.22 53.73 59.79 38.53 36.12 52.06 100.58 31.375 4,765 Mar.......... 58.23 69.2 57.3 101.08 113.73 45.67 54.01 60.30 39.17 35.43 52.61 104.04 23,069 3,479 Apr........... 59.33 71.3 58.2 101.93 114.67 46.07 54.28 60.62 38.66 35.69 52.71 103.00 18,770 2,368 May......... 57.38 69.1 56.5 101.16 113.76 45.70 53.87 60.22 39.71 35.40 50.99 103.65 17.796 2,127 June......... 57.86 69.3 56.8 101.78 114.50 45.61 54.23 60.70 40.41 35.16 51.82 103.57 18,965 2,177 July.......... 58.38 71.1 57.1 104.20 117.01 14.94 47.48 11.83 55.70 62.10 42.12 36.49 54.06 105.24 18,977 2,280 Week ending— 1976—July 3.. 58.02 69.6 56.6 103.85 116.84 14.84 47.37 11.76 55.46 62.03 41.64 35.88 53.65 105.06 19,760 2,306 10. . 58.33 70.3 56.9 104.06 116.95 14.81 47.25 11.74 55.61 62.09 41.86 36.29 53.90 105.76 19,953 2,098 17. . 58.58 71.3 57.3 105.48 118.46 15.16 47.80 11.95 56.35 62.93 42.81 36.66 54.72 106.73 23,198 2,463 24. . 58.33 71.1 57.0 103.96 116.77 15.00 47.58 11.83 55.57 61.94 42.28 36.55 53.90 104.73 17,366 2,068 31 . . 58.38 71.6 57.2 103.39 115.97 14.81 47.60 11.81 55.26 61.52 41.65 36.61 53.78 103.94 14,610 1,552 For notes see opposite page. STOCK MARKET CUSTOMER FINANCING (In millions of dollars) Margin credit at brokers and banks 1 Regulated 2 Unregu­ lated 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. 1975—June................................... 5,984 5,140 844 4,990 805 146 28 4 11 2,434 520 1,790 July.................................... 6,266 5,446 820 5,300 780 143 29 3 10 2,387 555 1,710 Aug.................................... 6,197 5,365 832 5,220 791 142 30 3 11 2,457 515 1,500 Sept.................................... 6,251 5,399 852 5,250 811 145 30 4 10 2,520 470 1,455 Oct..................................... 6,455 5,448 1,007 5,300 956 144 36 4 15 2,311 545 1,495 Nov.................................... 6,527 5,519 1,008 5,370 958 146 37 3 13 2,270 490 1,470 Dec.................................... 6,500 5,540 960 5,390 909 147 36 3 15 2,281 475 1,525 [976—Jan..................................... 6,568 5,568 1,000 5,420 946 146 34 2 20 2,321 655 1,975 Feb..................................... 7,152 6,115 1,037 5,950 984 162 34 3 20 2,333 685 2,065 Mar.................................... 7,617 6,575 1,042 6,410 988 162 34 3 20 2,355 595 1,935 Apr.................................... 7,932 6,856 1,076 6,690 1,023 163 32 3 21 2,325 570 1,740 May................................... 8,110 7,103 1,007 6,940 957 161 31 2 19 2,357 540 1,655 June................................... 8,276 7,248 1,028 7,080 976 166 33 2 19 2,368 540 1,680 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 STOCK MARKET CREDIT; SAVINGS INSTITUTIONS □ AUGUST 1976 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) Total Equity class (per cent) Equity class of accounts E pe n r d i o o d f l ( d d i m o o e o n b f i l l ­ s t ­ m 80 o o re r 70-79 60-69 50-59 40-49 Un 4 d 0 er End of period c st r N a e t e d u t i s t 60 o r p e m in r o c d r e e e n b t i t 6 L s 0 t e a p s t s u e r s t h c a e n n tof ( b m d T a o i l o l a l l t n l i a a o c l r n e s s ) lars) 1 1975—June..................... 45.9 43.1 11.0 7,875 1975—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.. 5,300 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 45.3 38.9 15.8 7,515 Sept.. 5,250 5.1 7.3 10.6 19.6 31.0 26.5 44.4 40.1 15.5 7,362 Oct... 5,300 5.5 6.7 11.2 21.8 29.7 25.2 45.3 40.2 14.5 7,425 Nov.. 5,370 5.2 6.7 12.2 23.2 28.6 24.0 43.8 40.8 15.4 7,290 Dec.. 5,390 5.3 6.9 11.6 22.3 28.8 25.0 1976—Jan........................ 45.8 44.0 10.3 7,770 1976—Jan... 5,420 7.0 9.4 18.3 21.3 28.8 15.5 Feb....................... 44.4 44.7 10.9 8,040 Feb.. 5,950 6.8 8.9 17.4 29.0 22.6 15.3 Mar...................... 44.0 46.0 10.4 8,050 Mar.. 6,410 6.0 8.7 16.0 29.0 25.0 16.0 43.0 45.0 12.0 7,990 Apr.. 6,690 6.1 7.7 12.9 27.7 30.2 15.4 41.4 46.2 12.4 8,030 May. 6,940 5.8 7.2 12.4 23.8 34.2 16.6 40.6 49.0 10.4 8,150 June. 7,080 6.3 7.7 14.4 32.2 25.4 14.1 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) Loans Securities Total Mortgage loan assets— commitments 2 End of period M ga o g r e t­ Other G U o . v S t . . g S l a o o t n c a v d a t t e l . o C r a t o h a n r t e d p e r o 1 ­ Cash O as t s h e e ts r g l r i e T e a a t s n o b i e n e e i t r d s a l r v i a l ­ e l De it p s os­ l O ia ti t b e h i s e li r ­ G r c e o e s a u n e c n e r ­ v r t a s e l classi ( f i i n e d m b o y n t m hs a ) turity accts. 3 or 3-6 6-9 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 1973............... 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 1974............... 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............... 77,127 4,028 4,777 1,541 27,964 2,367 3,195 120,999 109,796 2,770 8,433 896 301 203 403 1,803 1975—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 Sept.. . 76,429 4,487 4,279 1,495 27,033 1,783 3,136 118,643 107,560 2,778 8,304 1,011 372 256 499 2,138 Oct.. .. 76,655 4,481 4,368 1,523 27,106 1,805 3,152 119,089 107,812 2,950 8,328 950 368 275 394 1,987 Nov.. . 76,855 4,550 4,601 1,551 27,421 1,872 3,223 120,073 108,480 3,215 8,378 972 323 222 379 1,896 Dec__ 77,221 4,023 4,740 1,545 27,992 2,330 3,205 121,056 109,873 2,755 8,428 896 301 203 403 1,803 1976—Jan.... 77,308 4,839 4,918 1,581 28,473 1,961 3,245 122,325 110,979 2,892 8,455 923 315 195 426 1,859 Feb... 77,413 5,243 5,211 1,765 29,035 1,853 3,301 123,821 112,019 3,275 8,527 930 352 184 401 1,867 Mar... 77,738 5,366 5,452 1 ,867 30,043 1,740 3,321 125,526 114,090 2,859 8,577 1,092 360 251 427 2,130 Apr.. . 78,046 5,027 5,533 2,149 30,707 1,647 3,361 126,470 114,752 3,106 8,612 1,175 398 281 436 2,290 May p. . 78,286 5,103 5,660 2,318 31,179 1,539 3,385 127,470 115,521 3,296 8,654 1,237 419 290 480 2,426 1 Also includes securities of foreign governments and international tion-reserves basis. The data differ somewhat from balance sheet data organizations and nonguaranteed issues of U.S. Govt, agencies. previously reported by National Assn. of Mutual Savings Banks, which 2 Commitments outstanding of banks in New York State as reported to were net of valuation reserves. For most items, however, the differences the Savings Banks Assn. of the State of New York. Data include building are relatively small. loans. 3 Balance sheet data beginning 1972 are reported on a gross-of-valua- Note.—NAMSB estimates for all savings banks in the United States. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ SAVINGS INSTITUTIONS A31 LIFE INSURANCE COMPANIES (In millions of dollars) Government securities Business securities End of period a T s o s t e a ts l Total U St n a i t t e e s d Sta lo te c a a l nd Foreign1 Total Bonds Stocks M ga o g r e t s ­ e R st e a a t l e P lo o a li n c s y O as t s h e e ts r 1971. 222,102 11,000 4,455 3,363 3,182 99,805 79,198 20,607 75,496 6,904 17,065 11,832 1972, 239,730 11,372 4,562 3,367 3,443 112,985 86,140 26,845 76,948 7,295 18,003 13,127 1973. 252,436 11,403 4,328 3,412 3,663 117,715 91,796 25,919 81,369 7,693 20,199 14,057 1974 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. 289,084 14,582 5,894 4,440 4,248 135,014 106,755 28,259 89,358 9,634 24,389 16,107 1975--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 Sept.................................. 281,847 13,150 4,914 4,122 4,114 131,524 104,529 26,995 88,445 9,210 24,048 15,470 Oct................................... 284,829 13,793 5,505 4,148 4,140 133,237 105,473 27,764 88,655 9,356 24,171 15,617 Nov.................................. 286,975 14,129 5,762 4,210 4,157 134,495 106,385 28,110 88,850 9,464 24,271 15,766 289,084 14,582 5,894 4,440 4,248 135,014 106,755 28,259 89,358 9,634 24,389 16,107 1976—Jan................................... 293,870 15,380 6,446 4,652 4,282 138,965 108,130 30,835 89,395 9,661 24,498 15,971 Feb................................... 296,479 16,142 6,458 4,790 4,894 140,332 109,321 31,011 89,543 9,726 24,633 16,103 Mar.................................. 299,552 15,723 4,967 5,220 5,536 143,105 111,385 31,720 89,781 9,812 24,755 16,376 Apr.................................. 299,983 15,917 5,198 5,100 5,619 143,197 111 ,757 31,440 89,489 9,852 24,873 16,655 May*3............................... 301,754 15,975 5,141 5,146 5,688 144,496 113,087 31,409 89,529 9,909 24,978 16,867 l 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.” SAYINGS AND LOAN ASSOCIATIONS (In millions of dollars) Assets Liabilities Mortgage Total loan com­ End of period M ga o ge rt 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 — i l e s S c a a v p i i n ta g l s w N or e t t h2 m ro B o w n o e e r y ­ d 3 p L ro o i c n a e n s s s Other ou m a p t t s i e t t e r m a n i n o d e d d n i o 4 t n s f g 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 1974.................................. 249,293 23,240 22,991 295,524 242,959 18,436 24,780 3,244 6,105 7,454 1975.................................. 278,693 30,900 28,802 338,395 286,042 19,776 20,730 5,187 6,659 10,675 1975—June...................... 261,336 30,880 25,786 318,003 268,978 18,992 18,863 4,446 6,724 12,363 July....................... 264,458 32,054 26,311 322,823 272,032 19,266 18,744 4,771 8,010 12,611 Aug....................... 267,717 31,694 27,127 326,538 273,504 19,495 19,216 4,995 9,328 12,673 Sept....................... 270,600 30,786 27,745 329,131 277,201 19,414 20,031 5,128 7,357 12,585 Oct........................ 273,596 31,652 28,145 333,393 279,465 19,663 20,306 5,207 8,752 11,748 Nov....................... 275,919 32,498 28,610 337,027 281,711 19,919 20,413 5,164 9,820 11,365 Dec........................ 278,693 30,900 28,802 338,395 286,042 19,776 20,709 5,187 6,680 10,675 1976—Jan........................ 280,071 34,271 29,716 344,058 291,418 19,948 19,630 5,051 8,011 11,111 Feb........................ 282,487 36,128 30,251 348,866 295,364 20,162 18,746 5,134 9,460 12,878 Mar....................... 286,556 36,722 30,462 353,740 302,436 20,211 18,220 5,379 7,494 14,445 Apr........................ 290,727 36,437 30,663 357,827 305,234 20,475 17,759 5,787 8,572 15,512 May....................... 294,759 37,005 31,268 363,032 308,284 20,688 17,670 6,156 10,234 16,620 June**..................... 299,667 35,265 31,658 366,590 313,331 20,767 18,204 6,475 7,813 16,634 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 pass­ all, 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

A32 FEDERAL FINANCE □ AUGUST 1976 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 of Receipts Outlays or Public ments by Govt, Trea­ financ­ deficit debt Agency accounts Less: Equals: sury ing, (-) securi­ securi­ Special Total operat­ Other net2 ties ties notes i ing S is p s e u c e ia s l Other balance Fiscal year: 197 3 232,225 246,526 -14,301 30,881 216 11,712 109 19,275 2,459 -1,613 -4,129 197 4 264,932 268,392 -3,460 16,918 903 13,673 1,140 3,009 -3,417 889 -2,077 197 5 280,997 324,601 -43,604 58,953 -1,069 8,112 -1,081 50,853 -1,570 1,890 -6,920 197 6 300,005 365,610 -65,605 87,244 -90 6,581 -2,239 82,813 7,246 550 -9,412 Half year: 1974—July-Dee. 139,607 153,147 -13,540 18,429 -689 2,840 150 14,751 -3,228 557 -3,881 1975—Jan.-June 141,189 171,202 -30,013 40,524 -423 5,272 -1,231 36,059 1,657 1,643 -2,746 July-Dee. 139,453 184,545 -45,092 43,460 -39 -4,739 -1,186 49,347 866 -980 -4,368 1976—Jan.-June 160,552 181,066 -20,513 43,784 -51 11,320 -1,053 33,466 6,380 1,530 -5,044 Month: 1975—Juner.... 32,024 30,502 1,521 5,030 -42 4,131 276 581 82 181 -1,839 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 Oct.......... 19,316 32,425 -13,109 8,352 -5 -3,656 260 11,743 -203 -348 815 Nov........ 21,745 29,401 -7,656 4,800 -3 -749 -390 5,936 -3,844 392 -1,732 Dec......... 25,995 31,792 -5,797 9,850 -24 1,860 -249 8,215 1,971 166 -281 1976—Ja............n 25,634 30,725 -5,091 7,757 -2 -393 328 7,820 3,532 114 918 Feb.......... 20,845 29,833 -8,987 9,465 5 1,062 -564 8,972 64 -125 -46 Mar......... 20,431 29,054 -8,623 6,620 -6 -623 -83 7,320 -4,032 -288 -3,018 Apr......... 33,348 32,476 872 1,483 -32 50 4 1,398 3,517 545 1,792 May........ 22,679 28,410 -5,731 8,699 -9 5,130 -549 4,109 -3,383 502 -1,259 June........ 37.615 30,567 7,048 9,760 6,094 -189 3,847 6,682 782 -3,431 Selected balances Treasury operating balance Borrowing from the public. End Memo: of Le ss: Debt of period B F a . n R k . s ac l c T a o o n a a u d x n nts d t O a e r p t i h o e e s s r i 3 ­ Total se P c d u u e b r b i l t i t i c es s A ec g u e r n it c ie y s Sp I G e n c o v i v a e l t s , t n a l c e c n o t O u s n t o h ts f e r S n L p o e e te c ss i s a : l l E T q o u t a a l l s: s c p p o G r o N r i n o v p o s v a s o w . t t — . r e - e 4 d 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 7,634 139 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 (5) 396,906 76,092 197 6 11,972 2,856 7 14,835 620,432 10,853 129,614 21,952 479,719 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 2,745 70 5,928 492,664 11,323 117,761 25,423 (5) 360,804 76,459 197 5 7,286 1,159 7 8,452 576,649 10,904 118,294 23,006 446,253 78,842 Month: 1975—June... 5,773 1,475 343 7,591 533,188 10,943 123,033 24,192 396,906 76,092 July... 2,776 878 444 4,098 538,240 10,920 120,606 23,847 404,707 77,173 Aug.. . 2,349 1,214 -141 3,423 547,711 10,926 122,990 23,752 411,895 76,659 Sept.. . 8,074 2,162 529 10,765 553,647 10,935 120,839 23,385 420,358 77,026 Oct.... 8,517 1 ,251 559 10,327 561,999 10,931 117,183 23,645 432,102 78,016 Nov... 4,919 1,558 9 6,485 566,799 10,928 116,434 23,255 438,037 78,451 Dec.... 7,286 1,159 7 8,452 576,649 10,904 118,294 23,006 446,253 78,842 1976—Jan.... 10,077 1,899 7 11,982 584,405 10,902 117,901 23,333 454,072 79,355 Feb.... 10,350 1,682 7 12,039 584,405 10,902 117,901 23,333 463,045 78,359 Mar... 7,145 864 7 8,016 600,490 10,901 118,340 22,686 470,365 78,712 Apr__ 9,808 1,723 7 11,537 601,973 10,870 118,390 22,690 471,763 80,039 May... 6,746 1,407 7 8,159 610,672 10,861 123,520 22,140 475,872 June... 11,972 2,856 7 14,835 620,432 10,853 129,614 21,952 479,719 1 Represents non-interest-bearing public debt securities issued to the taries” (deposits in certain commercial depositaries that have been con­ International Monetary Fund and international lending organizations. verted from a time to a demand basis to permit greater flexibility in New obligations to these agencies are handled by letters of credit. Treasury cash management). 2 Includes accrued interest payable on public debt securities until June 4 Includes debt of Federal home loan banks, Federal land banks, R.F.K. 1973 and total accrued interest payable to the public thereafter; deposit Stadium Fund, FNMA (beginning Sept. 1968), and Federal intermediate funds; miscellaneous liability (includes checks outstanding) and asset credit banks and banks for cooperatives (both beginning Dec. 1968). accounts; seigniorage; increment on gold; fiscal 1974 conversion of in­ 5 Beginning July 1974, public debt securities excludes $825 million of terest receipts of Govt, accounts to an accrual basis; gold holdings, gold notes issued to International Monetary Fund to conform with Office of certificates and other liabilities, and gold balance beginning Jan. 1974; Management and Budget’s presentation of the budget. and net gain/loss for U.S. currency valuation adjustment beginning June 1975. 3 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

AUGUST 1976 □ FEDERAL FINANCE A33 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 contribution1 Un- Other taxes toms and re­ With­ tion with­ Re­ Net re­ Re­ empl. net Net gift ceipts 3 held Cam­ held funds total ceipts funds insur. re­ total paign Pay­ Self- ceipts2 Fund roll empl. taxes Fiscal year: 1973....................... 232,225 98,093 27,01721,866 103,24639,045 2,89352,505 2,371 6,051 3,61464,542 16,260 3,188 4,917 3,921 1974....................... 264,932 112,092 2830,81223,952 118,95241,744 3,125 62,878 3,008 6,837 4,051 76,780 16,844 3,334 5,035 5,369 1975....................... 280,997 122,071 3234,29634,013 122,38645,747 5,12571,789 3,417 6,770 4,46686,441 16,551 3,676 4,611 6,711 1976....................... 300,005 123,408 3435,52827,367 131,60346,783 5,37476,391 3,518 8,054 4,75292,71416,963 4,074 5,216 8,026 Half year: 1974—July-Dee... 139,607 61,378 7,098 1,01667,461 18,247 2,01634,418 254 2,914 2,18739,774 8,761 1,958 2,284 3,140 1975—Jan.-June.. 141,190 60,694 27,19832,99754,92627,500 3,10937,371 3,163 3,856 2,27946,667 7,790 1,718 2,327 3,370 July-Dee... 139,453 59,549 7,649 1,36265,835 18,810 2,73535,443 268 2,861 2,31440,886 8,759 1,927 2,573 3,397 1976—Jan.-June.. 160,552 63,859 3327,87926,00465,76727,973 2,63940,947 3,250 5,193 2,43851,828 8,204 2,147 2,643 4,630 Month: 1975—Juner......... 32,024 10,027 4,540 1,44413,123 10,241 664 5,553 373 92 413 6,431 1,464 301 412 715 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 1,045 425 8,085 1,257 372 9,713 1,394 302 430 723 Sept............ 28,615 9,182 4,809 38213,609 6,277 264 5,555 251 75 400 6,280 1,430 312 431 539 Oct........... 19,316 9,983 589 -81 10,653 1,694 821 4,551 259 395 5,206 1,462 343 396 382 21,745 10,195 283 12410,354 1,072 399 6,900 716 377 7,994 1,476 310 428 511 Dec............. 25,995 10,738 571 10911,200 6,884 354 5,043 17 110 395 5,565 1,482 347 386 485 1976—Jan............. 25,634 9,518 1 5,843 8615,276 1,771 218 5,540 225 223 442 6,430 1,335 348 401 292 Feb............. 20,845 10,938 7 933 4,100 7,778 1,203 422 8,330 237 693 370 9,631 1,354 288 475 538 Mar............ 20,431 11,377 9 2,532 8,646 5,272 6,485 621 5,796 275 129 435 6,635 1,344 384 450 482 Apr............. 33,348 10,029 712,723 7,51215,248 6,727 607 6,179 1,832 952 386 9,349 1,353 357 387 535 May........... 22,679 10,749 6 573 5,171 6.157 1.396 380 9,132 359 2,940 38012,811 1,329 349 489 528 June........... 37,615 11,249 3 5,275 49016,037 10.391 391 5,969 322 254 425 6,971 1,489 421 442 2,255 Budget outlays Gen­ Nat­ Educa­ Gen­ Rev­ eral ural Com- tion, eral enue Undis- Na­ sci­ Agri­ re­ Com­ mun. training, Health Govt., shar. trib. Period Total tional Intl. ence, cul­ sources, merce and employ­ and Vet­ Inter­ law and off­ de­ affairs space, ture envir., and region. ment, wel­ erans est en­ fiscal setting fense and and transp. devel­ and fare force., assist­ re­ tech. energy opment social and ance ceipts4 serv. justice Fiscal year: 1974................... 268,392 78,569 3,593 3,977 2,230 6,571 13,096 4,911 11,598 106,505 13,386 28,072 5,789 6,746 -16,651 1975.................... 324,601 86,585 4,358 3,989 1,660 9,537 16,010 4,431 15,248 136,252 16,597 30,974 6,031 7,005 -14,075 1976.................... 365,610 90,216 4,462 4,197 1,994 11,674 17,239 5,023 17,678 160,497 18,444 35,500 6,277 7,114 -14,704 TQ 5 6....................... 102,100 26,000 2,000 1,200 900 3,900 5,300 1,700 4,900 42,100 4,400 9,500 1,800 2,000 -3,600 19775................. 400,0001Ql,600 7,100 4,500 1,800 15,100 16,400 6,000 18,400172,700 17,800 40,200 6,900 7,400 -16,800 Month: 1975—Juner. ... 30,502 6,229 710 385 205 1,776 1,611 641 2,218 13,741 1,426 2,472 712 -47 -1,578 July......... 31,249 7,307 531 476 270 821 2,256 402 1,237 13,092 1,367 2,637 321 1,625 -1,094 Aug......... 30,634 8,229 448 402 117 770 2,165 568 1,690 12,431 1,447 2,672 553 213 -1,071 Sept......... 29,044 6,923 47 398 507 844 1,899 440 1,571 12,738 1,334 2,859 548 4 -1,068 Oct........... 32,425 8,192 362 398 312 740 1,965 462 896 13,575 1,518 2,957 492 1,592 -1,035 Nov......... 29,401 7,533 419 405 196 786 1,203 315 1,653 12,612 1,624 2,996 531 15 -887 Dec.......... 31,792 7,981 290 409 175 814 1,994 433 1,515 13,721 1,704 2,820 *,154 1 -1,221 1976—Jan........... 30,725 6,915 351 336 228 718 1,819 421 1,478 13,714 1,626 2,813 121 1,627 -1,441 Feb.......... 29,833 6,120 320 413 315 1,833 900 421 1,530 13,360 1,696 3,143 570 53 -841 Mar......... 29,054 7,752 320 379 44 935 -672 270 1,809 14,382 1,659 3,407 567 16 -1,814 Apr.......... 32,476 7,994 249 360 -51 984 1,610 464 1,606 13,679 1,652 3,356 420 1,605 -1,452 May........ 28,410 7,136 292 348 270 924 466 448 1,258 13,229 1,555 3,220 617 96 -1,449 June........ 30,567 8,134 1,077 371 -181 929 1,238 528 1,738 13,501 1,248 2,652 668 32 -1,368 1 Old-age, disability, and hospital insurance, and Railroad Retirement civilian agency pay raises totaling $800 million for fiscal year 1977, and accounts. therefore do not add to totals. 2 Supplementary medical insurance premiums and Federal employee 6 Effective in calendar year 1976, the fiscal year for the U.S. Govt, is retirement contributions. being changed from July 1-June 30 to Oct. 1-Sept. 30. The period July 1- 3 Deposits of earnings by F. R. Banks and other miscellaneous receipts. Sept. 30 of 1976, data for which are shown separately from fiscal year 4 Consists of interest received by trust funds, rents and royalties on the 1976 and fiscal year 1977 totals, will be a transition quarter. Outer Continental Shelf, and Govt, contributions for employee retirement. 5 Estimates presented in Mid-session Review of the 1977 Budget, July Note.—Half years may not add to fiscal year totals due to revisions in 16, 1976. Figures for outlay categories exclude special allowances for series that are not yet available on a monthly basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A34 U.S. GOVERNMENT SECURITIES □ AUGUST 1976 GROSS PUBLIC DEBT, BY TYPE OF SECURITY (In billions of dollars) Public issues (interest-bearing) Total End of period p d g u e r b b o l s t i s c 1 Total Total Bills Ma C c r e k a r e t t e i t f s a i b ­ le Notes Bonds 2 b C v i o b e o n l r n e d t­ ­ s Total N 3 on F i m s o s a u r r e e k i s g e n t 4 a bl S e b a o a v n n in d d g s s i S s p su e e c s ia l 5 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—Dec. 492.7 373.4 282.9 119.7 129.8 33.4 2.3 88.2 22.8 63.8 118.2 1975—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 Nov. 566.8 447.5 355.9 151.1 166.1 38.7 2.3 89.3 21.3 67.6 116.7 Dec. 576.6 457.1 363.2 157.5 167.1 38.6 2.3 91.7 21.6 67.9 118.5 1976—Jan.. 584.4 463.8 369.3 159.6 171.1 38.6 2.3 92.2 21.6 68.2 118.1 Feb. 593.9 473.7 378.8 162.1 177.6 39.1 2.3 92.7 21.7 68.6 119.2 Mar. 600.5 480.7 385.3 163.1 183.1 39.0 2.3 93.1 21.7 69.0 118.5 Apr. 602.0 482.4 386.4 161 .8 185.8 38.9 2.3 93.6 21.6 69.4 118.6 May 610.7 484.4 388.0 161.8 186.5 39.7 2.3 94.1 21.5 69.8 123.7 June 620.4 489.5 392.6 161.2 191 .8 39.6 2.3 94.6 21.5 70.1 129.8 July. 624.5 495.5 397.7 161.4 197.2 39.1 2.3 95.5 21.4 70.8 128.1 1 Includes non-interest-bearing debt (of which $613 million on July 31, 4 Nonmarketable certificates of indebtedness, notes, and bonds in the 1976, 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): depositary 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. StateSy 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 i t s l c ag G t U a e r o n u n .S v c d s t i . t . es B F a . n R k . s Total m C b e a o r n c m k ia ­ s l M s b a a v u n i t n u k g a s s l p I c a n a o n n s m c u ie e r ­ s ­ r c O a o t t r i h o p e n o r s ­ g S l a o o t n v c a d a t ts e l . Savi I n n g d s ividu O al t s her n F a i o t n a i r o n t e e n d 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—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—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 Aug.......... 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 Sept............... 553.6 142.3 87.0 324.4 78.4 4.0 7.6 15.0 32.2 66.5 23.0 65.5 32.3 Oct................. 562.0 138.8 87.2 336.0 80.5 4.2 7.9 17.5 33.8 66.8 23.2 66.9 35.2 Nov............... 566.8 137.7 85.1 343.9 82.6 4.4 8.8 20.0 33.9 67.1 23.5 66.1 37.5 Dec................ 576.6 137.4 87.9 349.4 85.8 4.5 9.3 20.2 33.8 67.3 23.6 66.5 38.3 1976—Jan................. 584.4 139.3 89.8 355.3 87.0 4.7 9.9 21.2 34.6 67.7 23.6 68.3 38.3 Feb................ 593.9 139.7 89.0 365.1 88.0 4.9 10.0 23.2 36.4 68.0 24.5 69.6 40.3 Mar............... 600.5 139.1 89.8 371.7 92.7 5.1 10.4 23.0 37.8 68.4 24.6 68.1 41.4 Apr................ 602.0 139.1 91.8 371.0 92.2 5.1 10.2 23.8 37.7 68.8 24.4 70.2 38.6 Mayp............ 610.7 143.7 90.5 376.4 92.0 5.3 10.3 26.0 37.6 69.2 24.5 71.0 40.5 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

AUGUST 1976 □ U.S. GOVERNMENT SECURITIES A35 OWNERSHIP OF MARKETABLE SECURITIES, BY MATURITY (Par value, in millions of dollars) Within 1 year 1-5 5-10 10-20 Over Type of holder and date Total years years years 20 years Total Bills Other All holders: 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 Dec. 31............................................................. 366,191 199,692 157,483 42,209 112,270 26,436 14,264 10,530 1976—May 31............................................................. 388,021 205,431 161,840 43,591 121,112 35,573 14,025 11,881 June 30............................................................. 392,581 204,167 161,198 42,969 127,017 35,561 13,979 11,857 U.S. Govt, agencies and trust funds: 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—Dec. 31.................................................. 19,347 2,769 207 2,562 7; 058 3,283 4,233 2,053 1976—May 31..................................................... 18,562 2,528 442 2,086 6,582 3,039 4,298 2,115 18,354 2,402 418 1,984 6,500 3,039 4,298 2,115 Federal Reserve Banks: 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 Dec. 31..................................................... 87,934 46,845 38,018 8,827 30,518 6,463 1,507 2,601 1976—May 31..................................................... 90,530 49,439 38,722 10,717 28,287 8,198 1,556 3,050 94,446 51,469 40,833 10,636 29,939 8,353 1,595 3,090 Held by private investors: 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 Dec. 31..................................................... 255,860 150,078 119,258 30,820 74,694 16,690 8,524 5,876 1976 May 31..................................................... 278,929 153,464 122,626 30,838 86,243 24,336 8,171 6,716 279,781 150,296 119,947 30,349 90,578 24,169 8,086 6,652 Commercial banks: 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 Dec. 31............................................ 64,398 29,875 17,481 12,394 29,629 4,071 552 271 1976—May 31............................................. 68,962 28,163 16,601 11,562 35,359 4,647 509 283 June 30............................................ 69,162 28,177 16,749 11,428 35,909 4,324 494 258 Mutual savings banks: 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 Dec. 31............................................ 3,300 983 554 429 1,524 448 232 112 1976—May 31............................................ 4,001 1,000 477 523 2,119 540 213 129 3,885 953 410 543 2,114 546 197 74 Insurance companies: 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 Dec. 31............................................ 7,565 2,024 1,513 511 2,359 1,592 1,154 436 1976—May 31............................................ 8,551 1,582 1,095 487 3,393 1,955 1,133 488 June 30............................................ 8,670 1,483 961 522 3,502 2,020 1,134 530 Nonfinancial corporations: 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—Dec. 31............................................ 9,365 7,105 5,829 1,276 1,967 175 61 57 1976—May 31............................................ 13,610 11,068 9,411 1,657 2,327 127 57 33 June 30........................................... 13,025 10,467 8,804 1,663 2,285 189 54 31 Savings and loan associations: 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—Dec. 31............................................ 2,793 914 518 396 1,558 216 82 22 1976—May 31............................................ 4,388 1,895 1,362 533 2,211 178 83 21 4,318 1,767 1,224 543 2,274 177 81 20 State and local governments: 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—Dec. 31............................................ 9,285 5,288 4,566 722 1,761 782 896 558 1976—May 31............................................ 14,868 10,425 9,616 809 2,111 879 804 649 13,174 8,339 7,460 879 2,271 971 802 790 All others: 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—Dec. 31............................................ 159,154 103,889 88,797 15,092 35,894 9,405 5,546 4,420 1976—May 31............................................ 164,550 99,332 84,115 15,217 38,723 16,009 5,373 5,114 167,548 99,110 84,338 14,772 42,223 15,943 5,325 4,948 Note.—-Direct public issues only. Based on Treasury Survey of banks, and 729 insurance companies combined, each about 90 per cent; Ownership. (2) 452 nonfinancial corporations and 486 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) 5,518 commercial banks, 470 mutual savings Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 U.S. GOVERNMENT SECURITIES □ AUGUST 1976 DAILY-AVERAGE DEALER TRANSACTIONS (Par value, in millions of dollars) U.S. Government securities By maturity By type of customer U.S. Govt. Period agency Total securities Within 1-5 5-10 Over U.S. Govt, U.S. Govt, Com­ All 1 year years years 10 years securities securities mercial other1 dealers brokers banks 1975—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 1,851 845 Sept................................. 5,566 4,032 1,315 128 91 931 1,405 1,198 2,033 787 Oct.................................. 8,714 5,929 2,332 309 144 1,271 2,675 1,839 2,929 1,250 Nov................................. 7,594 5,519 1,353 534 189 1,070 2,176 1,875 2,474 1,217 Dec.................................. 7,586 5,919 1,270 278 120 1,190 2,217 1,977 2,202 1,059 1976—Jan................................... 9,509 7,049 1,765 569 126 1,265 3,118 2,192 2,935 1,417 Feb.................................. 8,329 5,863 1,553 755 158 951 2,389 2,196 2,793 1,163 Mar................................. 9,044 6,763 1,807 358 116 1,308 2,777 2,276 2,683 1,185 Aor.................................. 10,293 7,667 2,186 306 134 1,341 3,154 2,426 3,372 1,665 May................................ 8,557 6,002 1,593 700 263 952 2,907 2,128 2,571 rl,131 June................................ 8,582 6,415 1,616 426 126 1,312 2,543 1,983 2,743 1,118 Week ending— 1976—June 2......................... 8,274 6,754 1,058 329 133 983 2,703 1,968 2,621 1,017 9......................... 9,588 6,822 2,134 463 170 1,280 3,192 2,209 2,908 1,071 16......................... 8,197 5,988 1,694 394 122 1,414 2,306 2,088 2,389 1,227 23......................... 7,595 5,582 1,607 321 84 1,285 2,054 1,732 2,519 1,266 30 r....................... 8,853 6,833 1,325 587 107 1,318 2,600 1,816 3,119 986 July 7......................... 9,421 6,914 1,136 1,281 90 1,430 2,795 2,099 3,099 1,253 14......................... 10,692 7,271 2,022 1,260 139 1,660 3,784 2,322 2,926 1,808 21......................... 8,030 5,670 1,488 784 88 1,175 2,756 1,545 2,554 1,460 28......................... 10,411 7,730 2,078 524 80 1,350 3,499 2,239 3,322 1,096 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. Period m t A a ie t l u s l ri­ W y i e 1 th ar in y 1 e - a 5 rs y 5 e - a 1 r 0 s y O e 1 v a 0 e rs r a s G e g t c e i o e 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 s1 ra­ o A th l e l r 1975—June................. 6,768 5,923 748 100 -3 790 1975—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 Oct................... 7,322 6,019 1,091 111 102 491 6,940 1,658 1,792 817 2,673 Nov................. 6,752 5,011 640 594 506 953 Nov............ 7,215 1,958 1,393 991 2,873 Dec.................. 6,061 5,274 322 218 247 982 7,107 2,001 1,304 1,086 2,716 1976—Jan................... 6,305 5,287 449 398 170 694 1976—Jan.............. 6,766 1,757 1,337 1,147 2,526 Feb.................. 6,263 5,477 381 224 183 602 Feb............. 6,700 1,705 850 1,017 3,128 Mar................. 6,884 6,360 286 122 116 537 Mar............ 7,175 1,865 1,138 1,225 2,947 Apr.................. 6,733 6,328 190 131 84 508 7,587 1,966 1,734 1,126 2,761 May................. 5,272 4,852 232 126 62 r 183 May........... 6,089 1,346 1,026 975 2,742 June................. 5,895 5,489 251 144 11 335 June........... 7,326 1,819 1,494 1,258 2,756 Week ending— Week ending— 1976—May 5......... 5,180 4,785 251 114 30 403 1976—May 5... 5,448 1,013 863 739 2,833 12, , , 5,984 5,181 419 227 156 281 12... 6,721 1,717 1,312 787 2,905 19 , , 4,905 4,550 115 165 74 205 19... 6,511 1,464 1,121 971 2,956 26......... 4,624 4,352 234 29 9 29 26... 5,561 1,277 905 1,051 2,328 June 2......... 5,827 5,853 -28 16 -14 61 June 2... 6,351 1,404 974 1,390 2,583 9......... 6,040 5,569 391 74 5 164 9... 7,251 1,747 1,574 1,333 2,597 16......... 6,531 6,146 265 97 24 315 16... 9,344 3,199 2,049 1,404 2,692 23......... 5,306 4,904 277 112 14 451 23... 6,953 1,455 1,370 1,220 2,908 30......... 5,669 5,115 192 350 11 520 30... 5,887 826 1,050 1,037 2,973 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

AUGUST 1976 □ FEDERALLY SPONSORED CREDIT AGENCIES A37 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 period Ad­ Cash Mem­ Deben­ Loans Loans vances Invest­ and Bonds ber Capital Mort­ tures to and Mort­ to 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) 1970. 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 1971. 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 1972 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 1973, 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. 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--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 Oct... 17,578 4,368 70 18,766 2,291 2,685 31,466 29,373 4,087 3,453 9,933 9,505 16,247 14,774 Nov. . 17,606 4,439 87 18,874 2,527 2,690 31,647 29,319 4,041 3,664 8,784 9,319 16,380 14,774 Dec... 17,845 4,376 109 18,863 2,701 2,705 31,916 29,963 3,979 3,643 9,947 9,211 16,564 14,773 1976--Jan.. . 17,106 5,549 97 18,850 2,971 2,802 31,866 29,809 4,356 3,793 9,944 9,201 16,746 15,243 Feb... 16,380 5,286 69 17,738 3,085 2,829 31,704 29,758 4,546 3,878 10,013 9,254 16,930 15,120 Mar. . 15,757 6,063 110 17,714 3,182 2,827 31,564 30,021 4,656 3,918 10,272 9,812 17,264 15,120 Apr... 15,336 6,394 113 17,713 2,990 2,829 31,468 30,148 4,590 3,921 10,762 9,877 17,514 15,834 May.. 15,215 5,585 97 17,114 2,891 2,836 32,113 29,805 4,470 3,761 10,823 10,034 17,731 15,834 June.. 15,274 3,739 118 17,136 2,949 2,839 32,090 29,863 4,413 3,733 11,188 9,998 17,979 15,834 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) are not guaranteed by the U.S. Govt. Loans are gross of valuation sheet items are capital accounts of all agencies, except for stock of FHLB’s. reserves and represent cost for FNMA and unpaid principal for other Bonds, debentures, and notes are valued at par. They include only publicly 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 .S v n t . s . State di s a s t n t a r d t i . ct Other2 Total c E at d i u o ­ n b R r a i o d n a g d d e s s i U tie ti s l­ 4 H in o g u s 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. 1971................. 24,963 15,220 8,681 1,000 62 5,999 8,714 10,246 24.495 5,278 2,642 5,214 2,068 9,293 1972................. 23,653 13,305 9,332 959 57 4,991 9,496 9,165 19,959 4,981 1,689 4,638 1,910 6,741 1973................. 23,969 12,257 10,632 1,022 58 4,212 9,505 10,249 22,397 4,311 1,458 5,654 2,639 8,335 1974................ 24,315 13,563 10,212 461 79 4,784 8,638 10,817 23,508 4,730 768 5,634 1,064 11,312 1975................. 30,607 16,020 14,511 76 7,438 12,441 10,660 29.495 4,689 1,277 7,209 647 15,673 1975—June. .. 3,066 1,772 1,292 2 938 1,137 989 2,840 430 164 821 28 1,397 July... 3,586 1,371 2,209 6 1,577 1,063 941 3,554 400 123 879 37 2,115 Aug.. . 2,786 1,058 1,725 3 376 1,665 747 2,561 379 55 626 67 1,434 Sept... 2,171 907 1,252 12 357 1,185 614 2,123 279 134 447 48 1,215 Oct.. .. 2,337 1,120 1,203 14 482 979 855 2,241 212 60 487 44 1,438 Nov.. . 2,385 1,040 1,341 4 470 1,244 667 2,318 219 88 618 28 1,365 Dec.... 2,062 995 1,057 10 434 1,043 576 1,990 287 29 495 20 1,159 1976—Jan.'.. 2,358 1,136 1,211 11 639 1,073 638 2,273 432 95 600 1,058 Feb.r.. 2,722 1,332 1,375 15 446 1,449 810 2,622 360 135 574 130 1,423 Mar.r. 3,346 2,173 1,166 7 1,254 824 1,262 3,1 439 215 710 692 1,124 Apr__ 2,365 1,191 1,163 11 455 1,181 718 2,252 341 25 665 358 863 May... 3,490 1,866 1,611 13 824 1,400 1,256 3,303 710 384 956 70 1,183 June?.. 2,756 1,547 1,194 15 590 1,024 1,131 2,537 364 59 693 98 1,323 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

A38 SECURITY ISSUES □ AUGUST 1976 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 .S v c t . y . 3 a ( n U S d t . a S lo t . e ) c 4 al Other 5 Total Total P o u f b fe l r ic e l d y P p ri l v a a c t e e d ly Preferred Common 1972., 84,792 17,080 12,825 23,070 1,589 40,228 26,132 17,425 8,706 3,370 10,725 1973., 99,050 19,057 23,883 22,700 1,385 32,025 21,049 13,244 7,802 3,337 7,642 1974. 38,311 32,066 25,903 6,160 2,253 3,994 1975 r 53,629 42,766 32,603 10,162 3,458 7,405 1975—Apr.'. 4,294 3,194 2,771 423 349 751 May'. 5,798 4,298 3,796 502 346 1,154 Juner. 5,596 4,594 3,943 651 230 772 July '. 4,327 3,673 2,658 1,014 198 456 Aug.r 2,399 1,836 1,356 480 129 434 Sept.r 2,a36 1,999 1,414 585 308 529 Oct.'. 4,705 3,158 2,389 769 332 1,215 Nov.' 4,068 3,296 1,666 1,630 444 328 Dec.r. 4,316 3,519 1,761 1,758 462 335 1976—Jan.'. 3,372 2,802 2,189 613 139 431 Feb.'. 3,838 2,911 2,142 769 173 754 Mar.. 6,624 4,577 3,238 2,721 443 1,604 Apr... 3,380 2,859 2,350 509 58 463 Gross proceeds, major groups of corporate issuers Period Manufacturing C m om is m ce e ll r a c n ia e l o u an s d Transportation Public utility Communication a R nd e a f l i n e a s n ta c t i e a l Bonds Stocks Bonds Stocks Bonds Stocks Bonds Stocks Bonds Stocks Bonds Stocks 197 2 4,560 1,833 2,526 2,786 1,258 148 6,349 4,966 3.709 1,126 7,728 3,242 197 3 4,199 638 1,318 1,532 1,084 26 5,578 4,691 3,523 1,348 5,344 2,745 197 4 9,867 544 1,845 940 1,550 22 8,873 3,964 3.710 217 6,218 562 1975'.......... 17,006 1,670 2,751 1,470 3,430 1 9,658 6,235 3,464 1,002 6,459 488 1975—Apr.1 1,498 233 294 211 97 794 586 354 61 156 9 May* 2,266 384 242 141 415 845 704 153 260 379 10 June1 2,195 123 384 194 211 838 640 362 603 45 July' 1,056 64 229 227 338 715 324 254 16 1,081 22 Aug. 580 101 141 70 17 719 305 93 19 286 68 Sept. 512 107 57 37 154 723 541 249 48 304 105 Oct.' 810 142 335 152 626 571 676 373 555 443 23 Nov. 874 229 81 53 1,000 851 424 45 10 444 57 Dec.1 1,295 130 473 193 330 539 363 205 27 679 83 1976—Jan.' 1,025 39 330 87 299 662 435 16 472 9 Feb.1 748 435 319 132 650 487 302 151 20 555 37 Mar. 1,838 405 216 84 323 747 1,411 577 1 875 146 Apr.. 489 60 567 115 319 327 312 448 709 35 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 preceding 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

AUGUST 1976 □ SECURITY ISSUES A39 NET CHANGE IN OUTSTANDING CORPORATE SECURITIES (In millions of dollars) Derivation of change, all issuers1 Period All securities Bonds and notes Common and preferred stocks New issues Retirements Net change New issues Retirements Net change New issues Retirements Net change 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 1975......................... 53,255 10,991 42,263 40,468 8,583 31,886 12,787 2,408 10,377 1974—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 Ill................ 9,079 2,576 6,503 6,654 2,111 4,543 2,425 465 1,960 IV................. 13,363 3,116 10,247 9,595 2,549 7,047 3,768 567 3,200 Type of issues Manu­ Commercial Transpor­ Public Communi­ Real estate facturing and other 2 tation 3 utility cation and financial i Period Bonds Bonds Bonds Bonds Bonds Bonds and Stocks and Stocks and Stocks and Stocks and Stocks and Stocks notes notes notes notes notes notes 197 2 1,995 2,094 1,409 2,471 711 254 5,137 4,844 3,343 1,260 7,045 2,096 197 3 801 658 -109 1,411 1,044 -93 4,265 4,509 3,165 1,399 3,523 1,181 197 4 7,404 17 1,116 -135 341 -20 7,308 3,834 3,499 398 5,428 207 1975 13,219 1,607 1,605 1,137 2,165 65 7,236 6,015 2,980 1,084 4,682 468 1974—IV. 3,098 126 240 -47 342 9 2,079 1,107 628 107 1,695 17 1975—I.. 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 Ill 1,442 412 221 108 147 53 1,395 1,043 472 97 866 247 IV. 2,069 433 528 462 1,588 4 1,211 1,537 429 604 1,222 160 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 4 at end of period) Year Month Sales i Redemp­ Net Total 2 Cash Other Sales 1 Redemp­ Net Total 2 Cash Other tions sales position 3 tions sales position 3 1963............... 2,460 1,504 952 25,214 1,341 23,873 1975—June.. 703 811 -108 45,538 3,640 41,898 1964............... 3,404 1,875 1,528 29,116 1,329 27,787 July... 813 1,052 -239 42,896 3,591 39,305, 1965............... 4,359 1,962 2,395 35,220 1,803 33,417 Aug... 753 788 -35 41,672 3,660 38,012 Sept... 760 874 -114 40,234 3,664 36,570 1966............... 4,671 2,005 2,665 34,829 2,971 31,858 Oct. . . 914 995 -81 41,860 3,601 38,259 1967................ 4,670 2,745 1,927 44,701 2,566 42,135 Nov... 786 911 -125 42,460 3,733 38,727 1968............... 6,820 3,841 2,979 52,677 3,187 49,490 Dec... 1,040 1 ,093 -53 42,179 3,748 38,431 1969............... 6,717 3,661 3,056 48,291 3,846 44,445 1976—Jan... 411 538 -47 46,529 3,287 43,242 1970................ 4,624 2,987 1,637 47,618 3,649 43,969 Feb... 262 577 -315 46,540 3,084 43,546 1971................ 5,145 4,751 394 55,045 3,038 52,007 Mar... 326 677 -351 46,866 2,881 43,985 Apr... 305 620 -315 45,956 2,683 42,273 1972................ 4,892 6,563 -1,671 59,831 3,035 56,796 May. . 241 589 -348 45,122 2,769 42,353 1973................ 4,358 5,651 -1,261 46,518 4,002 42,516 June.. 321 599 -278 46,801 2,679 44,122 1974................ 5,346 3,937 1,409 35,777 5,637 30,140 1975................ 10,057 9,571 486 42,179 3,748 38,431 1 Includes contractual and regular single-purchase sales, voluntary and Note.—Investment Company Institute data based on reports of mem­ contractual 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. 4 Beginning Jan. 1976, sales and redemption figures exclude money market funds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A40 BUSINESS FINANCE □ AUGUST 1976 SALES, REVENUE, PROFITS, AND DIVIDENDS OF LARGE MANUFACTURING CORPORATIONS (In millions of dollars) 1973 1974 1975 Industry 1973 1974 1975 IV I II III IV I II III IV Total (170 corps.) :► Sales.......................................... 442,351 564,284 586,394 121,023 126,812 143,077 145,054 149,341 138,322 145,872 147,986 154,214 Total revenue......................... 448,919 572,695 594,806 123,175 128,711 145,227 147,251 151,506 140,411 147,785 149,820 156,790 Profits before taxes............... 53,845 67,719 60,183 14,732 16,596 18,218 17,860 15,045 12,895 14,859 15,493 16,936 Profits after taxes................... 28,767 32,535 26,973 7,738 7,739 9,292 8,428 7,076 5,551 6,707 7,094 7,621 Memo: PAT unadj.1___ 28,798 32,739 27,744 7,920 7,627 9,222 8,497 7,393 5,667 6,596 7,046 8,435 Dividends................................ 11,516 12,303 12,444 3,393 2,912 2,928 3,073 3,390 3,128 3,032 3,072 3,212 Nondurable goods industries (86 corps.) :2^ Sales.......................................... 210,216 309,033 323,136 59,245 68,782 77,193 80,543 82,515 77,297 78,656 82,361 84,822 Total revenue......................... 214,028 314,584 328,502 60,423 70,066 78,654 82,021 83,843 78,616 79,940 83,595 86,351 Profits before taxes............... 30,211 46,446 40,905 8,979 11,887 11,998 12,618 9,943 9,378 9,989 10,924 10,614 Profits after taxes................... 15,537 20,568 16,303 4,452 5,055 5,740 5,473 4,300 3,586 3,919 4,441 4,357 Memo: PAT unadj.1......... 15,415 20,465 16,719 4,506 4,958 5,689 5,398 4,420 3,572 3,900 4,439 4,808 Dividends................................ 6,104 6,873 7,228 1,634 1,626 1,645 1,720 1,882 1,815 1,784 1,803 1,826 Durable goods industries (84 corps.):3 Sales.......................................... 232,135 255,251 263,258 61,778 58,030 65,884 64,511 66,826 61,025 67,216 65,625 69,392 Total revenue......................... 234,891 258,111 266,304 62,751 58,645 66,573 65,230 67,663 61,795 67,845 66,225 70,439 Profits before taxes............... 23,634 21,273 19,278 5,754 4,709 6,220 5,242 5,102 3,517 4,870 4,569 6,322 Profits after taxes................... 13,230 11,967 10,670 3,287 2,684 3,552 2,955 2,776 1,965 2,788 2,653 3,264 Memo: PAT unadj.1......... 13,383 12,274 11,025 3,413 2,669 3,533 3,099 2,973 2,095 2,696 2,607 3,627 Dividends................................ 5,412 5,430 5,216 1,760 1,286 1,283 1,353 1,508 1,313 1,248 1,269 1,386 Selected industries: Food and kindred products (28 corps.): Sales.......................................... 42,629 52,753 57,149 11,871 11,885 12,729 13,663 14,476 13,490 14,117 14,600 14,942 Total revenue......................... 43,198 53,728 58,156 11,938 12,110 12,996 13,939 14,683 13,708 14,356 14,844 15,248 Profits before taxes............... 3,957 4,602 5,025 1,067 1,046 1,190 1,289 1,077 1,066 1,190 1,385 1,384 Profits after taxes................... 2,062 2,298 2,496 543 529 607 645 517 502 607 919 668 Memo: PAT unadj.1......... 2,073 2,329 2,601 573 533 610 646 540 526 615 745 715 Dividends................................ 936 1,011 1,100 240 243 248 253 267 268 271 274 287 Chemical and allied products (22 corps.): Sales.......................................... 43,208 55,083 57,735 11,534 12,507 13,892 14,606 14,078 13,618 14,329 14,660 15,128 Total revenue......................... 43,785 55,676 58,376 11,704 12,667 14,066 14,778 14,165 13,756 14,503 14,791 15,326 Profits before taxes............... 6,264 8,263 7,082 1,572 1,856 2,293 2,194 1,920 1,647 1,622 1,858 1,955 Profits after taxes................... 3,505 5,876 3,889 883 1,044 1,247 1,223 1,362 932 929 1,035 993 Memo: PAT unadj.1......... 3,469 4,745 4,015 880 1,031 1,245 1,180 1,289 927 937 1,028 1,123 Dividends................................ 1,496 1,647 1,723 417 383 405 422 437 430 425 429 439 Petroleum refining (15 corps): Sales.......................................... 93,504 165,150 172,645 27,752 36,103 41,362 42,747 44,938 41,988 41,342 43,873 45,442 Total revenue......................... 95,722 168,680 175,915 28,584 36,913 42,261 43,659 45,847 42,851 42,100 44,633 46,331 Profits before taxes............... 17,493 30,657 26,305 5,724 8,296 7,564 8,339 6,458 6,227 6,612 6,961 6,505 Profits after taxes................... 8,551 11,775 8,551 2,662 3,098 3,349 3,181 2,147 1,905 2,078 2,300 2,268 Memo: PAT unadj.1......... 8,505 11,746 8,712 2,688 3,011 3,304 3,132 2,299 1,871 2,040 2,268 2,533 Dividends................................ 3,146 3,635 3,801 832 864 853 899 1,019 966 937 949 949 Primary metals and products (23 corps.): Sales.......................................... 42,400 54,044 48,578 11,379 11,888 13,976 14,285 13,895 12,482 12,393 12,274 11,429 Total revenue......................... 43,103 55,048 49,534 11,715 12,045 14,171 14,504 14,328 12,782 12,604 12,479 11,669 Profits before taxes............... 3,221 5,579 2,873 919 973 1,586 1,791 1,229 1,015 711 487 660 Profits after taxes................... 1,966 3,199 1,822 561 589 927 1,028 655 633 478 396 315 Memo: PAT unadj. 1......... 2,039 3,485 2,003 608 607 942 1,137 799 639 485 381 498 Dividends................................ 789 965 945 227 221 209 238 297 273 227 216 229 Machinery (27 corps.): Sales.......................................... 65,040 73,454 78,495 17,871 16,830 18,836 18,853 18,935 18,245 19,881 19,764 20,605 Total revenue......................... 65,925 74,284 79,469 18,168 17,012 19,023 19,075 19,174 18,464 20,104 19,956 20,945 Profits before taxes............... 7,670 7,643 8,610 2,149 1,829 2,074 1,943 1,797 1,727 2,089 2,219 2,575 Profits after taxes................... 4,236 4,214 4,770 1,200 1,006 1,149 1,074 985 971 1,178 1,224 1,397 Memo: PAT unadj.1......... 4,209 4,168 4,833 1,188 996 1,137 1,096 939 975 1,173 1,231 1,454 Dividends................................ 1,607 1,839 2,017 410 441 441 476 481 483 485 519 530 Motor vehicles and equipment (9 corps.): Sales.......................................... 83,017 80,386 85,863 21,186 18,467 20,979 19,443 21,497 18,866 22,275 21,005 23,717 Total revenue......................... 83,671 80,881 86,475 21,362 18,597 21,146 19,593 21,545 19,011 22,341 21,083 24,040 Profits before taxes............... 7,429 2,920 3,077 1,280 636 1,115 231 938 -98 854 590 1,731 Profits after taxes................... 3,991 1,686 1,471 709 369 657 133 527 -127 451 328 819 Memo: PAT unadj.1......... 4,078 1,742 1,604 763 361 648 147 586 -12 455 280 881 Dividends................................ 2,063 1,537 1,121 817 384 382 386 385 294 276 274 277 ^ Historical data covering revisions for the textile, apparel, and leather Note—Data are obtained from published reports of companies and industry, as well as total nondurables and all manufacturing, are available reports made to the Securities and Exchange Commission. Sales are net upon request from the Capital Markets Section, Division of Research and of returns, allowances, and discounts, and exclude excise taxes paid di­ Statistics, Board of Governors of the Federal Reserve System, Washing­ rectly by the company. Total revenue data include, in addition to sales, ton, D.C. 20551. income from nonmanufacturing operations and nonoperating income. 1 Profits after taxes unadjusted are as reported by the individual com­ Profits are before dividend payments and have been adjusted to exclude panies. These data are not adjusted to eliminate differences in accounting special charges and credits to surplus reserves and extraordinary items not treatments of special charges, credits, and other nonoperating items. related primarily to the current reporting period. Income taxes (not 2 Includes 21 corporations in groups not shown separately. shown) include Federal, State and local government, and foreign. 3 Includes 25 corporations in groups not shown separately. Previous series last published in June 1972 Bulletin, p. A-50. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ BUSINESS FINANCE A41 CORPORATE PROFITS, TAXES, AND DIVIDENDS (In billions of dollars) Profits In­ Profits Cash Undis­ Profits In­ Profits Cash Undis­ Year before come after divi­ tributed Quarter before come after divi­ tributed taxes taxes taxes dends profits taxes taxes taxes dends profits 1968 85.6 39.3 46.2 21.9 24.2 1974—1................... 128.3 49.4 78.9 30.0 48.9 1969 83.5 39.7 43.8 22.6 21.2 II................. 129.6 52.6 77.1 30.9 46.2 1970 71.5 34.5 37.0 22.9 14.1 II I 146.7 59.3 87.4 31.7 55.7 I V 123.9 49.2 74.7 31.7 43.0 1971 82.0 37.7 44.3 23.0 21.3 1972 96.2 41.4 54.6 24.6 30.0 1975—1................... 97.1 37.5 59.6 32.1 27.5 1973 117.0 48.2 68.8 27.8 40.9 II................. 108.2 41.6 66.6 32.6 34.0 1974 132.1 52.6 79.5 31.1 48.4 Ill................ 129.5 50.7 r78.8 33.5 45.3 1975. 116.8 45.6 71.2 32.8 38.4 IV................ 132.4 52.5 79.9 33.1 46.8 1976—1................... 142.8 57.1 85.7 33.3 52.4 Note.—Dept, of Commerce estimates. Quarterly data are at seasonally adjusted annual rates. CURRENT ASSETS AND LIABILITIES OF NONFINANCIAL CORPORATIONS (In billions of dollars) Current assets Current liabilities Net Notes and accts. Notes and accts. End of period working U.S. receivable payable Accrued capital Total Cash s G ec o u v r t i . ­ I t n o v ri e e n s ­ Other Total F in e c d o e m ra e l Other ties G U o . v S t . . 1 Other G U o . v S t . .1 Other taxes 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 *•574.4 57.5 r10.2 3.4 240.0 215.2 48.1 352.2 4.0 230.4 15.1 102.6 1973—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 Ill....................... 271.8 716.5 65.6 14.3 3.3 294.7 279.6 59.0 444.7 6.2 273.4 19.4 145.6 IV........................ 274.1 731.6 68.1 19.4 3.6 294.6 285.8 60.0 457.5 6.4 281.6 20.7 148.8 1976—1........................... 287.6 753.5 68.4 21.7 3.6 307.3 288.8 63.6 465.9 6.4 280.5 23.9 155.0 1 Receivables from, and payables to, the U.S. Govt, exclude amounts Note.—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 Total Durable d N ur o a n b ­ le Mining R ro a a i d l­ Air Other Electric and G a o s th er C ni o c m ati m on u s ­ Other 1 T A (S o . . R A ta . . ) l 1972......................... 88.44 15.64 15.72 2.45 1.80 2.46 1.46 14.48 2.52 11.89 20.07 1973......................... 99.74 19.25 18.76 2.74 1.96 2.41 1.66 15.94 2.76 12.85 21.40 1974.......................... 112.40 22.62 23.39 3.18 2.54 2.00 2.12 17.63 2.92 13.96 22.05 1975......................... 112.78 21.84 26.11 3.79 2.55 1.84 3.18 17.00 3.14 12.74 20.60 1974—11 ................. 28.16 5.59 5.69 .78 .64 .61 .49 4.56 .75 3.60 5.46 111.40 Ill................. 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................. 27.79 5.16 6.51 .94 .62 .50 .85 4.16 .91 3.14 5.00 112.16 IV................. 30.74 5.99 7.30 .97 .62 .43 .93 4.85 .85 3.26 5.52 111.80 1976—1.................... 25.87 4.78 6.18 .92 .49 .26 .72 4.18 .62 2.92 4.82 114.72 II2................ 30.51 5.64 7.43 .95 .56 .43 .86 4.90 .84 8.88 121.14 Ill2............... 30.49 5.73 7.58 .95 .56 .34 .80 4.87 .96 8.71 123.00 * 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

A42 REAL ESTATE CREDIT □ AUGUST 1976 MORTGAGE DEBT OUTSTANDING BY TYPE OF HOLDER (In millions of dollars) End of year End of quarter Type of holder, and type of property 1975 1976 1972 1973 1974 I II III IV I ALL HOLDERS................................................. 564,825 634,954 688,652 695,369 709,153 725,543 741,547 *•755,127 1- to 4-family.................................................... 345,372 384,738 412,168 415,607 425,132 436,420 447,350 **456,502 Multifamily....................................................... 76,667 85,296 91,222 91,522 91,733 92,073 92,093 r92,857 Commercial....................................................... 107,349 125,572 140,965 142,701 145,353 149,072 153,119 *•155,624 Farm................................................................... 35,437 39,348 44,297 45,539 46,935 47,978 48,985 r50,144 PRIVATE FINANCIAL INSTITUTIONS.. 450,000 505,400 542,552 546,689 558,179 570,049 581,486 r592,080 1- to 4-family.................................................... 288,018 320,420 340,007 342,313 350,198 358,184 365,371 *•372,572 Multifamily....................................................... 59,398 64,750 68,161 68,095 68,453 68,688 68,807 *"69,641 Commercial....................................................... 92,063 108,735 121,948 123,684 126,634 130,153 134,100 *•136,505 Farm................................................................... 10,521 11,495 12,436 12,597 12,894 13,024 13,208 *•13,362 Commercial banks1.......................................... 99,314 119,068 132,105 131,903 133,012 134,514 136,186 *737,986 1- to 4-family................................................ 57,004 67,998 74,758 74,696 75,356 76,149 77,018 *•78,044 Multifamily................................................... 5,778 6,932 7,619 7,176 6,816 6,363 5,915 *•5,989 Commercial................................................... 31,751 38,696 43,679 43,924 44,598 45,694 46,882 r47,495 4,781 5,442 6,049 6,107 6,242 6,308 6,371 *•6,458 Mutual savings banks...................................... 67,556 73,230 74,920 75,157 75,796 76,490 77,249 *•77,738 1- to 4-family................................................ 41,650 44,246 44,670 44,795 45,175 45,588 46,041 *•46,332 Multifamily................................................... 15,490 16,843 17,234 17,291 17,433 17,593 17,767 *•17,880 Commercial................................................... 10,354 12,084 12,956 12,996 13,112 13,233 13,364 *•13,449 Farm............................................................... 62 57 60 75 76 76 77 r77 Savings and loan associations........................ 206,182 231,733 249,293 252,442 261,336 270,600 278,693 286,575 1- to 4-family................................................ 167,049 187,750 201,553 204,099 211,290 218,483 224,710 230,776 Multifamily................................................... 20,783 22,524 23,683 23,831 24,409 24,976 25,417 25,846 Commercial................................................... 18,350 21,459 24,057 24,512 25,637 27,141 28,566 29,953 Life insurance companies................................ 76,948 81,369 86,234 87,187 88,035 88,445 89,358 89,781 1- to 4-family................................................ 22,315 20,426 19,026 18,723 18,377 17,964 17,602 17,420 Multifamily................................................... 17,347 18,451 19,625 19,797 19,795 19,756 19,708 19,926 Commercial................................................... 31,608 36,496 41,256 42,252 43,287 44,085 45,288 45,608 Farm............................................................... 5,678 5,996 6,327 6,415 6,576 6,640 6,760 6,827 FEDERAL AND RELATED AGENCIES.. 45,790 55,664 72,380 76,010 79,952 84,522 89,039 91,975 1- to 4-family.................................................... 30,170 35,579 46,322 48,455 51,195 54,697 58,440 60,391 Multifamily....................................................... 6,063 8,364 11,329 11,995 12,348 12,753 12,954 13,184 9,557 ii,72i 14,729 15,560 16,409 17,072 17,645 18,400 Government National Mortgage Association.. 5,113 4,029 4,846 5,599 5,610 6,534 7,438 7,619 1- to 4-family................................................ 2,513 1,455 2,248 2,787 2,787 3,692 4,728 4,886 Multifamily................................................... 2,600 2,574 2,598 2,812 2,823 2,842 2,710 2,733 Commercial.................................................. 837 1,200 1,600 1,700 1,800 1,900 2,000 2,100 1- to 4-family................................................ 387 550 734 780 826 872 918 964 Farm............................................................... 450 650 866 920 974 1,028 1,082 1,136 Federal Housing and Veterans Administra­ tions ............................................................ 3,338 3,476 4,015 4,047 4,297 4,681 4,970 5,143 1- to 4-family................................................ 2,199 2,013 2,009 1,879 1,915 1,951 1,990 1,922 Multifamily................................................... 1,139 1,463 2,006 2,168 2,382 2,730 2,980 3,221 Federal National Mortgage Association.... 19,791 24,175 29,578 29,754 30,015 31,055 31,824 31,482 17,697 20,370 23,778 23,743 23,988 25,049 25,813 25,562 Multifamily................................................... 2,094 3,805 5,800 6,011 6,027 6,006 6,011 5,920 Federal land banks (farm only)................... 9,107 11,071 13,863 14,640 15,435 16,044 16,563 17,264 Federal Home Loan Mortgage Corporation. 1,789 2,604 4,586 4,608 4,944 5,033 4,987 4,602 1- to 4-family................................................ 1,754 2,446 4,217 4,231 4,543 4,632 4,588 4,247 Multifamily................................................... 35 158 369 377 401 401 399 355 GNMA Pools.................................................... 5,815 9,109 13,892 15,662 17,851 19,275 21,257 23,765 1- to 4-family................................................ 5,620 8,745 13,336 15,035 17,136 18,501 20,403 22,810 Multifamily............................................ 195 364 556 627 715 774 854 955 INDIVIDUALS AND OTHERS2................. 69,035 73,890 73,720 72,670 71,022 70,972 71,022 71,072 27,184 28,739 25,839 24,839 23,739 23,539 23,539 23,539 Multifamily....................................................... 11,206 12,182 11,732 11,432 10,932 10,632 10,332 10,032 Commercial....................................................... 15,286 16,837 19,017 19,017 18,719 18,919 19,019 19,119 Farm................................................................... 15,359 16,132 17,132 17,382 17,632 17,882 18,132 18,382 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

AUGUST 1976 □ REAL ESTATE CREDIT A43 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 End of holdings transactions commitments holdings transactions commitments period (during period) (during period) Total i F su H m re A - d - a g n V u t A e a e r - - d chases 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 TJrJ VV rIiI A A 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............... 17,791 12,681 5,110 3,574 336 9,828 6,497 968 821 147 778 64 182 1972............... 19,791 14,624 5,112 3,699 211 8,797 8,124 1,789 1,503 286 1,297 408 i ,606 198 1973............... 24,175 16,852 6,352 6,127 71 8,914 7,889 2,604 1,743 861 1,334 409 1,629 186 1974............... 29,578 19,189 8,310 6,953 5 10,765 7,960 4,586 1,904 2,682 2,191 52 4,553 2,390 1975............... 31,824 19,732 9,573 4,263 2 6,106 4,126 4,987 1,824 3,163 1,716 1,020 982 111 1975—June.. 30,015 19,282 8,498 326 557 6,549 4,944 1,936 3,008 210 5 28 700 July.. 30,351 19,385 8,693 538 575 6,119 5,015 1,943 3,072 161 63 139 530 Aug... 30,777 19,507 8,942 594 814 5,888 4,942 1,863 3,080 98 145 132 509 Sept... 31,055 19,560 9,122 488 575 5,399 5,033 1,852 3,181 148 31 79 403 Oct... 31,373 19,641 9,309 508 282 4,685 5,119 1,843 3,276 176 59 45 201 Nov... 31,552 19,648 9,430 372 332 4,385 4,971 1,834 3,137 104 225 50 124 Dec... 31,824 19,732 9,573 451 517 4,126 4,987 1,824 3,163 69 30 71 111 1976—Jan.. . 31,772 19,674 9,554 76 189 3,170 4,958 1,816 3,142 47 57 42 99 Feb... 31,618 19,541 9,521 56 55 355 3,201 4,686 1,802 2,884 51 296 43 87 Mar. . 31,482 19,431 9,473 85 22 405 3,120 4,602 1,787 2,815 95 98 93 128 Apr... 31,389 19,368 9,431 103 184 213 2,788 4,520 1,768 2,752 43 86 209 289 May.. 32,052 19,296 9,390 877 1,305 3,732 4,486 1,752 2,735 73 64 178 376 June.. 32,028 19,238 9,391 240 857 4,153 i Includes conventional loans not shown separately. For FHLMC: Holdings and transactions cover participations as well as Note.—Data from FNMA and FHLMC, respectively. whole loans. Holdings include loans used to back bond issues guranteed For FNMA: Holdings include loans used to back bond issues guaranteed by GNMA. Commitments cover the conventional and Govt.-under­ by GNMA. Commitments include some multifamily and nonprofit written loan programs. hospital loan commitments in addition to 1- to 4-family loan commitments accepted in FNMA’s free market auction system, and through the FNMA- GNMA Tandem Plans. FEDERAL NATIONAL MORTGAGE ASSOCIATION AUCTIONS OF COMMITMENTS TO BUY HOME MORTGAGES Date of auction Item 1976 Feb. 23 Mar. 8 Mar. 22 Apr. 5 Apr. 19 May 3 May 17 June 1 June 14 June 28 July 12 July 26 Amounts (millions of dollars): Govt.-underwritten loans Offered i.................................... 126.9 299.9 146.3 106.2 132.1 483.3 634.3 349.5 146.6 261.2 148.3 311.8 Accepted.................................. 81.2 171.9 121.6 56.2 60.1 222.3 321.4 224.7 98.8 157.5 88.4 212.0 Conventional loans Offered i.................................... 44.0 75.4 46.2 56.4 55.3 110.7 128.8 131.4 77.3 93.6 90.7 130.5 Accepted.................................. 23.3 45.0 33.7 31.8 33.4 60.1 68.9 90.5 70.3 59.2 82.0 105.2 Average yield (per cent) on short­ term commitments 2 Govt.-underwritten loans......... 9.04 9.06 9.03 8.94 8.83 8.94 9.13 9.20 9.14 9.12 9.05 9.04 Conventional loans................... 9.14 9.15 9.13 9.05 9.00 9.09 9.24 9.31 9.30 9.31 9.27 9.23 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 require­ paid for mortgage servicing) for home mortgages assuming a prepayment ments. Commitments mature in 4 months. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A44 REAL ESTATE CREDIT a AUGUST 1976 MAJOR HOLDERS OF FHA-INSURED AND VA-GUARANTEED RESIDENTIAL MORTGAGE DEBT (End of period, in billions of dollars) June 30, Sept. 30, Dec. 31, Mar. 31, June 30, Sept. 30, Dec. 31, Holder 1974 1974 1974 1975 1975 1975 1975 All holders....................................................... 137.8 138.6 140.3 142.0 143.0 144.9 147.0 FHA.............................................................. 84.9 84.1 84.1 84.3 85.0 85.1 85.4 VA.................................................................. 52.9 54.5 56.2 57.7 58.0 59.8 61.6 Commercial banks......................................... 11.0 10.7 10.4 10.5 9.6 9.7 9.4 FHA.............................................................. 7.6 7.4 7.2 7.2 6.4 6.4 6.3 VA.................................................................. 3.4 3.3 3.2 3.3 3.2 3 3 3 1 Mutual savings banks................................. 27.9 27.8 27.5 27.3 27.2 27.0 27.4 FHA.............................................................. 15.1 15.0 14.8 14.7 14.7 14.5 14.7 VA................................................................. 12.8 12.8 12.7 12.6 12.5 12.5 12.7 Savings and loan assns.................................. V FH A A .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . } 29.7 } 29.9 } 29.9 } 29.9 } 30.2 } 30.4 \ 30.6 Life insurance cos........................................... 13.1 12.9 12.7 12.5 12.2 12.1 11.8 FHA.............................................................. 8.8 8.7 8.6 8.4 8.2 8.1 7.9 VA................................................................. 4.3 4.2 4.2 4.1 4.0 4.0 3.9 Others............................................................... 56.1 57.4 59.9 61.6 62.2 65.7 67.8 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 Total Period Number co a m m m ou it n te t d Loan Contract Loanof loans (m (d il o li l o la n r s s ) of ( o th a f m o d u o o s l u a la n n r t d s s ) (p in e r t r a e c t r e e e s n t t ) (y M rs a . t /m ur o it s y .) (p to e ra - r v t c i a e o l n u t e ) C (p a t p e io r it n a c l e r i n z a t a t ) e ­ co D r v a e e t r i b o a t ge P co e n r s c t e a n n t t 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 1975............................. 599 1,717.0 2,866 10.22 21/9 73.8 10.8 1.33 11.2 1975—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 July................. 53 178.6 3,370 10.19 20/7 74.6 10.9 1.31 11.3 Aug.................. 44 106.5 2,420 10.26 21/2 72.7 10.8 1.32 11.4 Sept................. 57 123.8 2,172 10.24 22/8 73.6 10.7 1.37 11.1 Oct................... 57 144.7 2,538 10.29 20/10 74.3 10.7 1.28 11.3 Nov................. 47 252.8 -5,378 10.24 22/7 72.7 10.9 1.35 11.2 Dec.................. 52 159.4 3,065 10.15 23/4 73.7 11.0 1.34 11 .0 1976—Jan................... 32 99.2 3,099 10.25 20/11 74.3 1.29 11.2 10.7 Feb.................. 40 140.2 3,506 10.08 20/6 74.2 1.26 11.0 10.5 Mar................. 71 294.6 4,150 10.04 21/11 73.8 1.30 11.0 10.6 Note.—American Life Insurance Association data for new commitments to cases where information was available or estimates could be made: of $100,000 and over each on mortgages for multifamily and nonresidential capitalization rate (net stabilized property earnings divided by property nonfarm properties located largely in the United States. The 15 companies value); debt coverage ratio (net stabilized earnings divided by debt service); account for a little more than one-half of both the total assets and the and per cent constant (annual level payment, including principal and nonfarm mortgages held by all U.S. life insurance companies. Averages, interest, per $100 of debt). All statistics exclude construction loans, which are based on number of loans, vary in part with loan composition increases in existing loans in a company’s portfolio, reapprovals, and loans by type and location of property, type and purpose of loan, and loan secured by land only. amortization and prepayment terms. Data for the following are limited Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ REAL ESTATE CREDIT AND CONSUMER CREDIT A45 TERMS AND YIELDS ON NEW HOME MORTGAGES Conventional mortgages FHA- Terms i Yields (per cent) in insured primary market loans—Yield Period in private C ra o c te n e n t ( r t p a ) e c r t ( F p c e e h r e a s c r g e a n e n s t d ) 2 M (y a e tu ar r s i ) ty L (p o e a r r a n t / c i p o e r n ic t) e pr o P i f c u e d r o c ( h t l h l a a o s r u e s) s. (t a d h m o L o l o u o la a s u r . n n s o ) t f F s H er L ie B s B 3 s H er U ie D s4 se m c a o r n k d e a t r s y 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 1975............................. 8.75 1.54 26.8 76.1 44.6 33.3 9.01 9.10 9.19 1975—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................. 8.70 1.46 26.7 75.9 45.6 34.1 8.94 9.25 9.74 Oct................... 8.75 1.59 27.3 77.5 43.9 33.2 9.01 9.25 9.53 Nov.................. 8.74 1.65 27.6 76.5 46.4 34.8 9.01 9.20 9.41 Dec.................. 8.74 1.65 27.8 76.9 45.9 34.7 9.01 9.15 9.32 1976—Jan................... 8.71 1.74 27.4 76.9 47.2 35.4 8.99 9.05 9.06 Feb.................. 8.67 1.56 26.0 75.1 45.2 33.4 8.93 9.00 9.04 Mar................. 8.67 1.60 27.1 76.4 46.8 35.0 8.93 8.95 Apr.................. 8.67 1.52 27.3 75.3 48.5 35.8 8.92 8.90 8.82 May................. 8.75 1.35 26.5 77.5 46.3 35.3 8.97 9.00 9.03 June**............... 8.71 1.25 26.4 75.1 48.5 36.0 8.91 9.05 9.05 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 pre­ costs 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. FINANCE RATES ON SELECTED TYPES OF INSTALMENT CREDIT (Per cent per annum) Commercial banks Finance companies Month New Mobile Other Personal Credit- Automobiles Other automo­ homes consumer loans card Mobile consumer Personal biles (84 mos.) goods (12 mos.) plans homes goods loans (36 mos.) (24 mos.) New Used 1974—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 13.22 19.25 20.74 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 i 3 ] 43 ' i9!3i * 20!87 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 is.eo ' 1*9 .’49* *ii! i i ’ 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 21.09 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 *20!66' 20.82 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 20.72 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 13.78 i 9! 87 *20 .‘93* 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 13.78 19.69 21.16 Oct.... 11.24 12.05 13.00 13.38 17.11 13.15 17.79 Nov... 11.24 11.76 12.96 13.40 17.06 13.17 17.82 ’ 1*3.’ 43* i 9.66 21.09 Dec.. . 11.25 11.83 13.11 13.46 17.13 13.19 17.86 1976—Jan.... 11.21 11.76 13.14 13.40 17.08 13.18 17.25 Feb.. . 11.18 11.77 13.02 13.24 17.14 13.14 17.37 13.18 19.58 21.13 Mar... 11.13 11.82 13.02 13.13 16.99 13.13 17.48 Apr... 11.08 11.66 12.95 13.16 17.04 13.13 17.58 May. . *•11.00 11.61 12.96 r13.27 17.02 June**. 11.02 11.82 12.99 13.32 17.04 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

A46 CONSUMER CREDIT □ AUGUST 1976 INSTALMENT CREDIT-TOTAL OUTSTANDING, AND NET CHANGE (In millions of dollars) 1975 1976 Holder, and type of credit 1973 1974 1975 Dec. Jan. Feb. Mar. Apr. May June Amounts outstanding (end of period) TOTAL........................................................... 146,434 155,384 162,237 162,237 160,824 160,402 160,729 162,334 164,101 166,664 By holder: 71,871 75,846 78,703 78,703 78,293 77,957 78,039 78,982 79,785 80,850 35,404 36,208 36,695 36,695 36,528 36,458 36,450 36,745 37,022 37,490 Credit.unions......................................... 19,609 22,116 25,354 25,354 25,250 25,492 26,025 26,403 26,975 27,842 Retailers1................................................ 16,395 17,933 18,002 18,002 17,133 16,769 16,375 16,448 16,465 16,633 Others2................................................... 3,155 3,281 3,483 3,483 3,620 3,726 3,840 3,756 3,854 3,849 By type of credit: Automobile, total................................. 50,065 50,392 53,028 53,028 52,832 53,044 53,650 54,572 55,484 56,667 Commercial banks............................ 31,502 30,994 31,534 31,534 31,305 31,322 31,580 32,162 32,664 33, 69 Purchased...................................... 18,997 18,687 18,353 18,353 18,227 18,135 18,200 18,472 18,671 18,912 12,505 12,306 13,181 13,181 13,078 13,187 13,381 13,690 13,993 14,358 Finance companies........................... 10,718 10,618 11,439 11,439 11,503 11,579 11,695 11,903 12,080 12,333 Credit unions.................................... 7,456 8,414 9,653 9,653 9,612 9,704 9,908 10,051 10,269 10,601 Others................................................. 389 366 402 402 412 439 467 456 471 464 Mobile homes: 8,340 8,972 8,704 8,704 8,605 8,532 8,485 8,439 8,408 8,390 Finance companies........................... 3,358 3,524 3,451 3,451 3,411 3,384 3,363 3,351 3,336 3,343 6,950 7,754 8,004 8,004 7,976 7,973 8,026 8,089 8,209 8,367 Commercial banks........................... 4,083 4,694 4,965 4,965 4,928 4,907 4,924 4,978 5,048 5,129 Revolving credit: Bank credit cards.............................. 6,838 8,281 9,501 9,501 9,576 9,408 9,221 9,343 9,402 9,531 Bank check credit............................. 2,254 2,797 2,810 2,810 2,802 2,803 2,769 2,775 2,777 2,805 All other................................................. 68,629 73,664 76,738 76,738 75,621 75,258 75,215 75,765 76,485 77,561 Commercial banks, total................. 18,854 20,108 21,188 21,188 21,076 20,985 21,060 21,285 21,486 21,726 Personal loans............................... 12,873 13,771 14,629 14,629 14,589 14,549 14,578 14,743 14,871 15,034 Finance companies, total............... 20,914 21,717 21,655 21,655 21,465 21,348 21,247 21,350 21,466 21,675 Personal loans............................... 16,483 16,961 17,681 17,681 17,523 17,500 17,434 17,528 17,631 17,811 11,564 13,037 14,937 14,937 14,878 15,020 15,333 15,557 15,894 16,402 Retailers.............................................. 16,395 17,933 18,002 18,002 17,133 16,769 16,375 16,448 16,465 16,633 Others................................................. 902 869 956 956 1,069 1,136 1,200 1,125 1,174 1,125 Net change (during period)3 TOTAL............... ......... 19,676 8,952 *•6,843 *•1,490 *•1,103 *•1,123 *■1,473 *•1,427 1,474 1,330 By holder: Commercial banks................................ 11,001 3,975 *•2,851 *•753 *•129 *■467 *•552 *•575 713 409 Finance companies............................... 4,006 806 483 188 148 160 282 326 157 230 2,696 2,507 3,238 470 387 420 514 392 521 482 1,632 1,538 69 125 185 58 108 177 5 214 Others..................................................... 341 126 202 -46 254 17 16 -42 78 -5 By type of credit: Automobile, total. ............................... 5,968 ’’327 *•2,631 *■759 r539 *•614 *■663 *•732 652 526 Commercial banks............................ 4,197 -508 *•535 *•453 *•44 *•303 *•237 *•356 340 229 Purchased...................................... 2,675 -310 *•-340 162 26 35 99 162 110 32 Direct.............................................. 1,523 -198 *•875 *•292 *•18 *•267 *•138 *•194 230 197 Finance companies........................... 740 -100 821 117 238 146 240 224 122 116 1,024 958 1,239 184 203 165 192 151 181 186 Other................................................... 7 -23 36 5 54 -6 2 9 —4 Mobile homes: Commercial banks........................... 1,933 632 -268 -17 r —62 -53 -18 -52 -37 -42 Finance companies........................... 444 168 -73 -14 -31 -35 -11 -17 * Home improvement, total.................. 1,033 804 248 67 109 58 69 39 70 79 Commercial banks............................ 482 611 271 46 28 29 41 26 36 29 Revolving credit: Bank credit cards.............................. 1,430 1,443 1,220 6 106 132 192 139 M93 98 Bank check credit..;....................... 478 543 14 10 *■-11 18 16 35 44 14 All other................................................. 8,389 5,036 3,072 678 r452 389 550 546 570 655 2,480 1,255 1,080 254 r24 40 84 70 138 81 Personal loans............................... 1,492 898 858 238 r42 27 51 69 112 86 Finance companies, total............... 2,564 803 -64 88 -60 50 43 119 53 115 Personal loans............................... 1,746 479 717 95 -7 128 62 116 21 95 Credit unions.................................... 1,591 1,473 1,900 274 173 241 307 228 326 282 Retailers.............................................. 1,632 1,538 69 125 185 58 108 177 5 214 Others................................................. 122 -33 87 -63 129 1 7 -49 48 -38 1 Excludes 30-day charge credit held by retailers, oil and gas companies, 3 Figures for all months are seasonally adjusted and equal extensions and travel and entertainment companies. minus liquidations (repayments, charge-offs, and other credits). 2 Mutual savings banks, savings and loan associations, and auto dealers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ CONSUMER CREDIT A47 INSTALMENT CREDIT EXTENSIONS AND LIQUIDATIONS (In millions of dollars) 1975 1976 Holder, and type of credit 1973 1974 1975 Dec. Jan. Feb. Mar. Apr. May June Extensions1 TOTAL............... ......... 160,228 160,008 '163,483 '15,228 '15,132 '15,045 '15,521 '15,003 15,041 15,592 By holder: Commercial banks................................ 72,216 72,605 '77,131 '7,385 '6,870 '7,196 '7,352 '6,989 7,223 7,289 Finance companies............................... 38,922 35,644 32,582 2,870 2,975 3,018 2,945 2,913 2,776 2,986 Credit unions......................................... 21,143 22,403 24,151 2,381 2,253 2,248 2,389 2,386 2,448 2,456 25,440 27,034 27,049 2,431 2,578 2,347 2,596 2,544 2,313 2,650 Others3................................................... 2,507 2,322 2,570 161 456 236 238 171 280 211 By type of credit: Automobile, total................................. 46,105 43,209 '48,103 '4,642 '4,505 '4,523 '4,689 '4,583 4,471 4,600 Commercial banks........................... 29,369 26,406 '28,333 '2,830 '2,446 '2,672 '2,699 '2,677 2,616 2,660 Purchased...................................... 17,497 15,576 15,761 1,584 1,356 1,435 1,514 1,475 1,413 1,386 Direct.............................................. 11,872 10,830 '12,572 '1,246 '1,091 '1,238 '1,185 '1,202 1,204 1,274 Finance companies........................... 9.303 8,630 9,598 896 896 930 990 975 914 935 Credit unions..................................... 7,009 7,788 9,702 875 1,068 881 964 891 892 968 Others................................................. 424 385 470 42 95 40 35 40 49 36 Mobile homes: Commercial banks........................... 4,438 3,486 2,681 244 211 211 233 186 182 204 Finance companies.......................... 1,573 1,413 771 69 61 55 63 61 49 68 Home improvement, total.................. 4,414 4,571 4,398 421 440 405 414 413 385 410 2,487 2,789 2,722 267 235 244 253 259 233 235 Revolving credit: Bank credit cards............................. 13,863 17,098 20,428 1,839 1,921 2,012 2,118 1,985 2,103 2,088 3,373 4,227 4,024 396 '361 392 380 394 422 435 86,462 86,004 83,079 7,618 7,633 7,447 7,624 7,382 7,429 7,786 Commercial banks, total................ 18,686 18,599 18,944 1,810 1,697 1,665 1,669 1,489 1,667 1,666 Personal loans............................... 12,928 13,176 13,386 1,301 1,184 1,179 1,182 1,081 1,203 1,221 27,627 25,316 22,135 1,902 2,014 2,030 1,890 1,874 1,810 1,981 Personal loans............................... 17,885 16,691 17,333 1,549 1,643 1,685 1,551 1,545 1,465 1,641 Credit unions..................................... 13,768 14,228 13,992 1,461 1,141 1,319 1,376 1,446 1,511 1,440 25,440 27,034 27,049 2,431 2,578 2,347 2,596 2,544 2,313 2,650 Others................................................. 941 827 959 14 204 86 93 29 127 50 Liquidations1 TOTAL............... 140,552 151,056 '156,640 '13,738 '14,029 '13,923 '14,048 '13,576 13,566 14,261 By holder: Commercial banks................................ 61,215 68,630 '74,280 '6,632 '6,741 '6,729 '6,800 '6,414 6,510 6,879 Finance companies............................... 34,916 34,838 32,099 2,682 2,827 2,858 2,663 2,587 2,619 2,756 Credit unions......................................... 18,447 19,896 20,913 1,910 1,866 1,828 1,875 1,994 1,927 1,974 23,808 25,496 26,980 2,306 2,393 2,289 2,488 2,367 2,308 2,436 Others3................................................... 2,166 2,196 2,368 207 202 219 222 214 202 216 By type of credit: Automobile, total................................. 40,137 42,883 '45,472 '3,883 '3,966 '3,909 '4,026 '3,851 3,819 4,074 Commercial banks........................... 25,172 26,915 '27,798 '2,376 '2,402 '2,370 '2,463 '2,321 2,276 2,432 Purchased....................................... 14,823 15,886 '16,101 1,422 1,329 1,399 1,416 1,313 1,303 1,354 Direct.............................................. 10,349 11,029 '11,697 '955 '1,073 '970 '1,047 '1,008 973 1,077 8,563 8,730 8,777 779 658 783 750 751 792 819 5,985 6,830 8,463 691 865 716 772 740 711 783 Others.................................................. 417 408 434 37 41 40 42 39 39 40 Mobile homes:. Commercial banks........................... 2,505 2,854 2,949 261 '273 264 251 237 219 247 Finance companies........................... 1,129 1,245 844 83 91 89 63 72 67 68 Home improvement, total.................. 3,381 3,767 4,150 353 331 348 344 374 314 330 Commercial banks........................... 2,005 2,178 2,451 222 207 216 212 232 197 206 Revolving credit: Bank credit cards............................. 12,433 15,655 19,208 1,832 1,815 '1,881 '1,926 1,846 1,911 1,990 Bank check credit............................. 2,894 3,684 4,010 386 '372 374 364 359 378 421 All other................................................. 78,072 80,969 80,007 6,940 '7,181 7,058 7,074 6,836 6,859 7,132 Commercial banks, total................ 16,205 17,345 17,864 1,555 '1,673 1,625 1,584 1,418 1,529 1,585 Personal loans............................... 11,435 12,278 12,528 1,063 '1,143 1,151 1,131 1,012 1,091 1,135 Finance companies, total............... 25,063 24,513 22,199 1,814 2,073 1,981 1,846 1,756 1,758 1,866 Personal loans............................... 16,139 16,212 16,616 1,454 1,650 1,556 1,489 1,429 1,445 1,546 Credit unions..................................... 12,177 12,755 12,092 1,187 968 1,077 1,069 1,218 1,185 1,158 Retailers.............................................. 23,808 25,496 26,980 2,306 2,393 2,289 2,488 2,367 2,308 2,436 819 860 872 77 75 86 86 77 79 87 1 Monthly figures are seasonally adjusted. 3 Mutual savings banks, savings and loan associations, and auto dealers. 2 Excludes 30-day charge credit held by retailers, oil and gas companies, and travel and entertainment companies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 INDUSTRIAL PRODUCTION o AUGUST 1976 INDUSTRIAL PRODUCTION—1976 REVISION (Seasonally adjusted, 1967 = 100) 1967 1975 1975 1976 pro­ aver­ Grouping por­ age tion July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June?3 July* Major market groupings Total index...................................... 100.00 117.8 118.4 121.0 122.1 122.2 123.5 124.4 125.7 127.3 128.1 128.4 129.6 130.1 130.4 Products, total.................................... 60.71 119.3 120.9 122.3 122.8 122.4 123.8 124.9 126.0 127.4 128.1 128.0 128.8 129.1 129.4 Final products.................................... 47.82 118.2 119.7 120.8 121.5 120.9 122.3 123.5 123.9 125.3 126.4 126.3 127.2 127.2 127.4 Consumer goods........................ 27. 124.0 126.6 127.5 129.0 128.7 131.1 132.3 133.1 134.9 136.1 136.1 137.3 137.3 137.3 Equipment................................... 20.14 110.2 110.0 111.4 111.3 110.0 110.0 111.5 111.2 112.1 112.9 112.9 113.2 113.4 113.8 Intermediate products................... 12.89 123.1 125.0 127.9 127.6 128.0 129.3 129.9 133.6 135.3 134.9 134.7 135.0 136.4 136.8 Materials.............................................. 39.29 115.5 114.5 119.0 121.0 122.0 123.1 123.3 125.3 127.3 128.2 129.2 131.0 131.6 132.0 Consumer goods Durable consumer goods..................... 7.89 121.4 126.6 129.2 132.2 131.9 132.5 134.0 134.7 137.9 140.3 141.1 143.3 144.2 144.3 Automotive products..................... 2.83 125.9 137.0 139.1 142.1 140. 143.2 147.7 142.8 148.9 155.2 155.2 154.8 156.7 156.8 Autos and utility vehicles......... 2.03 113.7 127.6 130.2 133.9 133.6 134.7 140.0 133.4 142.0 149.5 152.1 153.4 156.4 156.4 Autos........................................ 1.90 101.1 114.2 116.3 118.5 119.1 120.9 122.8 118.9 125 133.6 134.3 134.4 137.4 136.9 Auto parts and allied goods... .80 156.6 160.5 161.8 162.7 159.0 164.9 167.0 167.4 166.5 169.5 163.1 158.9 157.9 158.0 Home goods.................................... 5.06 118 120.8 123.5 126.7 127.0 126.5 126.4 130.3 131.7 132.0 133.1 136.8 137.1 137.2 Appliances, A/C, and TV......... 1.40 98.0 107.1 105.8 107.0 105.3 100.9 101.1 107. 112.6 114.6 117.2 122.2 122.2 119.5 Appliances and TV............... 1.33 100.2 110.7 109.4 111.0 109.3 103.7 104.4 110.6 115.2 117.1 119.6 125.0 124.8 122.0 Carpeting and furniture........... 1.07 126.8 125.4 134.3 141.1 141.9 144.7 142.0 144. 145.6 141.4 143.0 142.6 142.9 Misc. home goods...................... 2.59 126.9 126.4 128.8 131.4 132.6 132.9 133.6 136.6 136.3 137.9 137.8 142.5 142.9 14416 Nondurable consumer goods.............. 19.79 125.1 126.7 126.9 127.6 127. 130.6 131.5 132.5 133.9 134.4 134.0 134.8 134.6 134.5 Clothing........................................... 4.29 111.6 113.2 117.5 116.8 120.4 123.2 123.9 127.4 127.6 130.1 129.6 131.8 Consumer staples........................... 15.50 128.8 130.6 129.6 130.7 129.3 132.5 133.6 133.9 135.7 135.6 135.2 135.6 136.2 * 1* 36; 0 Consumer foods and tobacco. . 8.33 122.8 125.1 125.1 125.2 125.3 127.6 127.2 128.5 129.9 129.0 128.4 129.5 128.9 Nonfood staples......................... 7.17 135.8 137.0 134.9 137.1 133.8 138.2 141.0 140.2 142.3 143.3 143.3 142.9 144.6 143.8 Consumer chemical products 2.63 151.3 153.0 149.1 150.4 149.8 157.8 159.7 157.3 161.1 163.6 162.1 161.4 163.8 Consumer paper products..., 1.92 107.0 108.3 105.7 108.0 104.4 107.5 113.4 113.3 113.9 113.4 114.2 114.3 113.4 Consumer energy products.. 2.62 141.6 141.9 142.3 145.0 139.2 140.9 142 142.4 144.3 145.0 145.9 145.2 148.2 Residential utilities............ 1.45 152.3 151.1 153.0 154.1 148.6 152.0 152.0 154.5 153.7 153.7 Equipment Business equipment................................ 12.63 128.2 127.3 129.9 129.2 128.8 129.6 131.6 131.0 132.6 134.0 134.1 134.8 135.2 135.6 Industrial equipment..................... 6.77 121.2 120.0 121.8 121.9 122.1 123.0 124.5 123.5 124.0 125.6 125.3 126.9 127.2 127.0 Building and mining equip. 1.44 168.3 168. 172.4 170.5 172.9 174.9 172.9 171.4 171.5 172.1 170.7 174.6 175.2 176.0 Manufacturing equipment 3.85 99.9 100.0 100.8 100.7 100.5 99.9 101.3 101.2 102.7 104.4 105.4 106.4 107.0 107.4 Power equipment......................... 1.47 130.8 124.5 127.2 129.5 128.9 132.3 137.6 134.6 133.1 135.6 132.7 134.0 133.1 129.9 Commercial transit, farm equip.., 5.86 136.3 135.8 139.1 137.8 136.4 137.2 139.7 139.7 142.4 143.7 144.6 143.8 144.6 145.7 Commercial equipment............. 3.26 157.8 157.8 161.8 160.4 158.5 159.5 164.4 165.0 166.6 168.5 170.0 169.5 171.4 171.6 Transit equipment...................... 1.93 101.9 104.0 104.6 104.4 102.4 102.8 102.9 100.2 103.7 104.7 105.6 104.2 104.9 106.2 Farm equipment.......................... .67 130.6 120.3 127.9 123.7 126.6 127.7 125.6 131.5 135.3 134.7 132.7 133.1 128.7 Defense and space equipment............ 7.51 80.0 81.0 80.6 81.2 78.5 77.3 77.7 78.0 77.6 77.4 77.3 77.7 76.8 77.3 Intermediate products Construction supplies........................ 6.42 116.3 116.8 121.3 122.3 122.7 123.1 124.1 126.8 129.6 128.7 128.0 130.1 131.4 131.9 Business supplies................................. 6.47 129.8 133.1 134.3 132.8 133.3 135.4 135.9 140.3 140.9 141.2 141.3 139.8 141.4 Commercial energy products___ 1.14 150.6 151.9 153.9 150.9 147.5 149.8 147.9 158.1 154.0 157.6 156.8 157.6 158.1 Materials Durable goods materials...................... 20.35 109.1 107.3 112.9 114.5 114.6 115.2 115.5 118.3 121.6 122.4 124.5 127.1 128.0 129.1 Durable consumer parts............... 4.58 97.7 99.2 108.7 110 107.2 109.3 111.6 111.7 116.7 118.5 119.2 122.8 123.2 121.8 Equipment parts............................. 5.44 118.9 114.8 117.4 119.0 120.6 122.3 123.9 125.7 127.5 128.5 130.5 133.0 133.6 134.1 Durable materials n.e.c................. 10.34 109.0 106.9 112.4 113.7 114.8 114.0 112.9 117.4 120.7 121.0 123.5 125.8 127.2 129.6 Basic metal materials................ 5.57 99.1 94.9 101.3 100.0 99.5 99.5 96.1 101.9 105.1 104.0 107.8 114.2 114.9 Nondurable goods materials............... 10.47 126.6 127.1 131.6 138.8 140.3 141.3 142.6 142.9 145.5 146.7 146.9 146.4 147.1 147.3 Textile, paper, and chem. mat..., 7.62 129.0 128.6 134.3 142.9 144.9 146.2 147.9 147.5 150.5 152.7 152.2 151.2 152.0 152.4 Textile materials......................... 1.85 100.6 106.1 107.8 118.2 117.3 118.4 118.9 117.8 116.2 115.5 114.1 115.8 115.7 Paper materials........................... 1.62 113.2 111.3 115.5 120.4 121.6 124.4 125.9 126.5 130.0 130.1 132.1 131.2 132.5 Chemical materials..................... 4.15 147.9 145.5 153.5 162.7 166.3 167.2 169.5 168.9 173.9 178.0 177.2 174.9 175.9 Containers, nondurable................. 1.70 127.9 131.0 131.9 140.2 137.3 134.8 136.1 139.0 142.2 141.3 141.9 140.7 144.5 Nondurable materials n.e.c.......... 1.14 108.3 110.8 112.9 109.1 114.3 118.4 116.7 118.3 117.3 115.1 120.4 123.2 118.5 Energy materials................................ 8.48 117.2 116.5 118.3 114.5 117.0 119.7 118.7 120.6 118.8 119.6 118.8 121 .0 121.2 119.7 Primary energy................................ 4.65 108.3 107.6 107.7 106.0 109.6 110.5 107.3 107.7 105.4 106.2 105.0 107.2 107.7 Converted fuel materials............. 3.82 128.0 127.4 131.2 124.8 125.9 130.8 132.3 136.3 135.2 136.0 135.7 137.7 137.6 Supplementary groups Home goods and clothing................ 9.35 115.5 117.3 120.8 122.1 124.0 125.0 125.2 129.9 129.8 131.1 131.5 134.5 133.3 133.5 Energy, total........................................ 12.23 125.5 125.2 126.7 124.5 124.5 127.1 126.6 128.8 127.5 128.6 128.2 129.4 130.4 129.3 Products........................................... 3.76 144.3 145.0 145.7 146.8 141.8 143.7 144.5 147.2 147.1 148.8 149.3 148.9 151.2 150.8 Materials.......................................... 8.48 117.2 116.5 118.3 114.5 117.0 119.7 118.7 120.6 118.8 119.6 118.8 121.0 121.2 119.7 For Notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ INDUSTRIAL PRODUCTION A49 INDUSTRIAL PRODUCTION—1976 REVISION (Seasonally adjusted, 1967 = 100) 1967 1975 1976 SIC pro­ 1975 Grouping code por­ aver­ tion age July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June*5 July6 Gross value of products in market structure (Annual rates, in billions of 1972 dollars) 1286.3 505.9 509.9 517.2 521.5 521.1 527.1 528.4 531.9 544.3 546.0 545.0 550.8 551.7 533.7 Final products......................... U21.4 393.3 395.5 400.3 405.3 404.0 409.7 410.6 410.9 421.7 423.0 421.8 427.2 427.2 409.2 Consumer goods............... 1156.3 274.4 278.4 280.7 284.3 285.0 290.5 292.0 292.3 300.6 299.7 299.9 303.7 303.9 285.2 Equipment......................... 165.3 119.0 117.2 119.3 121.0 119.1 119.3 118.9 119.1 121.1 123.6 122.1 123.4 123.4 124.3 Intermediate products.............. 164.9 112.6 114.4 116.9 116.1 116.6 117.6 117.9 120.8 122.8 122.6 123.0 123.8 124.5 124.2 Major industry groupings 12.05 128.5 127.2 129.0 127.2 127.9 130.5 129.2 131.8 131.5 131.6 131.2 132.2 132.4 131.7 6.36 112.8 110.8 111.6 111.6 113.8 114.2 112.9 113.6 112.7 113.9 113.5 113.6 114.2 112.8 5.69 146.0 145.5 148.3 144.6 143.8 148.8 147.2 152.0 152.5 151.4 150.8 153.0 152.7 153.0 3.88 160.8 160.0 164.7 159.0 157.3 165.5 162.3 167.4 168.7 167.3 87.95 116.3 117.0 119.7 121.4 121.2 122.7 123.6 125.2 127.0 127.9 128.5 129.3 130.0 130.4 Nondurable............................ 35.97 126.4 128.1 130.5 132.9 133.6 136.2 136.9 138.4 140.2 140.7 140.7 140.6 140.8 140.8 51.98 109.3 109.3 112.3 113.5 112.7 113.4 114.4 115.8 117.9 119.0 120.1 121.5 122.5 123.1 Mining Metal mining.............................. 10 .51 115.8 107.0 115.0 113.5 112.5 118.1 117.9 122.2 124.2 122.3 124.3 118.5 121.2 Coal.............................................. 11,12 .69 113.4 105.5 112.9 112.6 122.2 125.6 109.9 111 .2 109.6 114.4 114.4 119.2 122.4 104.8 Oil and gas extraction............. 13 4.40 113.3 113.0 112.4 111.8 113.1 112.3 113.1 112.5 110.1 111 .9 111 .3 111 .7 111.8 111 .7 Stone and earth minerals..... 14 .75 107.0 105.6 103.9 108.0 110.9 112.1 111.5 117.1 120.0 119.3 117.5 116.7 116.2 Nondurable manufactures Foods.......................................... 20 8.75 123.4 125.4 125.8 126.2 126.4 128.8 128.5 129.2 130.8 128.3 129.2 131.2 130.6 Tobacco products..................... 21 .67 111 .8 114.1 110.5 114.1 113.9 118.5 116.0 117.3 118.8 122.4 115.4 114.5 Textile mill products................ 22 2.68 122.3 127.8 130.0 138.3 137.5 141.6 139.0 137.6 138.7 136.4 135.7 138.4 138.4 Apparel products...................... 23 3.31 107.6 106.3 112.8 111.5 115.9 118.3 121.2 123.8 128.0 126.3 126.1 131.0 Paper and products.................. 26 3.21 116.3 116.5 120.5 124.5 126.5 127.7 129.5 130.3 133.0 132.2 133.9 134.2 137.1 135.5 Printing and publishing........... 27 4.72 113.4 115.5 115.3 114.7 113.2 115.4 118.4 120.0 121.0 121.0 122.0 120.5 120.5 119.3 Chemicals and products.......... 28 7.74 147.3 147.1 150.8 154.4 157.5 161.9 163.3 162.9 167.6 170.6 168.7 167.5 170.1 Petroleum products.................. 29 1.79 124.1 127.1 126.8 130.8 125.1 124.9 126.3 125.7 129.1 131.8 131.6 132.7 134.8 133.7 Rubber & plastic products---- 30 2.24 166.7 173.2 180.4 187.6 185.1 185.2 185.3 188.4 196.7 203.5 198.2 186.9 190.6 Leather and products............... 31 .86 76.5 80.3 80.7 80.9 85.8 87.7 83.2 86.0 86.1 86.0 87.7 91.4 84.7 Durable manufactures Ordnance pvt. & govt............... 19,91 3.64 76.6 76.6 76.5 75.9 72.0 70.0 70.1 69.9 69.5 69.5 69.1 69.3 69.3 69.8 Lumber and products............... 24 1.64 107.6 110.6 113.6 115.8 116.8 114.1 116.4 123.5 123.9 121.1 122.8 123.0 122.6 Furniture and fixtures.............. 25 1.37 118.2 118.6 123.6 128.4 127.9 128.7 130.3 132.7 134.1 130.6 131.7 131.0 129.9 Clay, glass stone prod............. 32 2.74 117.9 119.2 121.0 126.4 127.8 127.5 129.4 128.6 128.5 133.7 132.7 132.2 133.7 Primary metals.......................... 33 6.57 96.4 92.3 97.7 97.9 95.4 98.1 92.6 98.1 103.9 101.4 105.4 114.0 114.6 117.3 Iron and steel........................ 4.21 95.8 87.0 92.7 93.4 92.0 96.5 89.1 92.9 100.9 97.7 103.5 112.0 114.1 116.3 Fabricated metal prod............. 34 5.93 109.9 108.9 113.8 115.3 114.4 116.3 117.3 116.6 120.9 120.2 121.5 121.4 123.8 122.9 Nonelectrical machinery......... 35 9.15 125.1 123.9 126.2 125.5 125.4 126.6 128.6 129.0 131.5 132.9 133.5 134.0 133.8 135.0 Electrical machinery.................. 36 8.05 116.5 116.5 118.0 120.2 120.1 120.1 122.7 124.7 126.5 127.8 130.0 131.6 131.7 132.2 Transportation equip............... 37 9.27 97.4 101.1 105.0 105.9 104.4 104.7 106.7 105.8 109.0 111 .2 110.6 112.9 113.2 111.5 Motor vehicles & pts........... 4.50 111.1 116.3 123.7 126.8 126.5 127.1 130.1 126.7 135.2 140.8 141.3 144.3 146.7 142.7 Aerospace & misc. tr. eq___ 4.77 84.5 86.9 87.3 86.3 83.6 83.6 84.7 86.1 84.3 83.3 81.7 83.3 81.8 82.0 Instruments................................. 38 2.11 132.3 130.7 131.9 135.1 136.0 136.4 140.9 142.0 141.8 144.4 145.4 149.0 150.0 151.0 Miscellaneous mfrs................... 39 1.51 128.3 128.8 131.5 132.1 134.6 137.6 137.3 139.5 140.7 142.5 140.7 145.5 146.6 147.6 1 1972 dollars. N.B. Published groupings include some series and subtotals not shown separately. For summary description and historical data, see Bulletin for June 1976, pp. 470-79. Availability of detailed descriptive and historical data will be announced in a forthcoming Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A50 BUSINESS ACTIVITY; CONSTRUCTION a AUGUST 1976 SELECTED BUSINESS INDEXES (1967= 100, except as noted) Industrial production Manu­ Prices4 facturing2 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 Final (1967 con­ ploy­ ploy­ rolls sales 3 sumer com­ Mate­ Manu­ output tracts ment— ment modity Total Inter­ rials factur­ = 100) Total 1 Con­ Equip­ mediate ing Total sumer ment goods 1955....................... 58.5 56.7 55.4 59.0 50.4 61.6 61.3 58.2 90.0 76.9 92.9 61.1 59 80.2 87.8 1956....................... 61.1 59.9 58.6 61.2 55.3 64.4 62.9 60.5 88.2 79.6 93.9 64.6 61 81.4 90.7 1957....................... 61.9 61.2 60.4 62.7 57.5 64.4 62.8 61.2 84.5 80.3 92.2 65.4 64 84.3 93.3 1958....................... 57.9 58.7 57.6 62.1 51.5 62.9 56.6 56.9 75.1 78.0 83.9 60.3 64 86.6 94.6 1959....................... 64.8 64.5 63.2 68.1 56.5 69.5 65.3 64.1 81.4 81.0 88.1 67.8 69 87.3 94.8 1960....................... 66.2 66.3 65.3 70.7 58.0 69.9 66.1 65.4 80.1 68.6 82.4 88.0 68.8 70 88.7 94.9 1961....................... 66.7 67.0 65.8 72.2 57.3 71.3 66.2 65.6 77.6 70.2 82.1 84.5 68.0 70 89.6 94.5 1962....................... 72.2 72.3 71.4 77.1 63.7 75.7 72.1 71.5 81.4 78.1 84.4 87.3 73.3 75 90.6 94.8 1963....................... 76.5 76.4 75.5 81.3 67.5 79.9 76.7 75.8 83.0 86.1 86.1 87.8 76.0 79 91.7 94.5 1964....................... 81.7 80.9 79.8 85.8 71.4 85.2 82.9 81.0 85.5 89.4 88.6 89.3 80.1 83 92.9 94.7 1965....................... 89.8 88.2 87.6 92.6 80.7 90.6 92.4 89.7 89.0 93.2 92.3 93.9 88.1 90 94.5 96.6 1966....................... 97.7 95.9 95.9 97.3 94.0 96.2 100.7 97.9 91.9 94.8 97.1 99.9 97.8 97 97.2 99.8 1967....................... 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 1968....................... 106.3 106.2 106.2 105.9 106.5 106.3 106.5 106.4 87.7 113.2 103.2 101.4 108.3 109 104.2 102.5 1969....................... 111.1 110.3 109.6 109.8 109.3 112.9 112.5 111 .0 86.5 123.7 106.9 103.2 116.6 114 109.8 106.5 1970....................... 107.8 106.9 105.3 109.0 100.1 112.9 109.2 106.4 78.3 123.1 107.7 98.1 114.1 119 116.3 110.4 1971....................... 109.6 108.5 106.3 114.7 94.7 116.7 111.3 108.2 75.0 145.4 108.1 94.2 116.7 130 121.2 113.9 1972....................... 119.7 118.0 115.7 124.4 103.8 126.5 122.3 118.9 78.6 165.3 111 .9 97.6 131.5 142 125.3 119.8 1973....................... 129.8 127.1 124.4 131.5 114.5 137.2 133.9 129.8 83.0 179.5 116.8 103.2 149.2 160 133.1 134.7 1974....................... 129.3 127.3 125.1 128.9 120.0 135.3 132.4 129.4 78.9 169.7 119.1 102.1 157.1 171 147.7 160.1 1975....................... 117.8 119.3 118.2 124.0 110.2 123.1 115.5 116.3 68.7 166.0 116.9 91.4 151.0 186 161.2 174.9 1975—July........... 118.4 120.9 119.7 126.6 110.0 125.0 114.5 117.0 I 165.0 116.4 89.7 148.7 190 162.3 175.7 Aug........... 121 .0 122.3 120.8 127.5 111 .4 127.9 119.0 119.7 \ 69.0 208.0 116.9 90.9 154.2 191 162.8 176.7 Sept........... 122.1 122.8 121.5 129.0 111.3 127.6 121 .0 121.4 J 157.0 117.4 92.0 157.0 189 163.6 177.7 Oct............ 122.2 122.4 120.9 128.7 110.0 128.0 122.0 121 .2 166.0 117.8 92.5 158.4 192 164.6 178.9 Nov........... 123.5 123.8 122.3 131.1 110.0 129.3 123.1 122.7 \ 70.7 148.0 117.8 92.4 158.9 192 165.6 178.2 Dec............ 124.4 124.9 123.5 132.3 111 .5 129.9 123.3 123.6 1 137.0 118.1 93.0 162.3 198 166.3 178.7 1976—Jan............. 125.7 126.0 123.9 133.1 111 .2 133.6 125.3 125.2 183.0 118.7 94.0 165.9 197 166.7 179.3 Feb............ 127.3 127.4 125.3 134.9 112.9 135.3 127.3 127.0 [ 72.1 170.0 119.0 94.3 165.4 201 167.1 179.3 Mar........... 128.1 128.1 126.4 136.1 112.9 134.9 128.2 127.9 I 185.0 119.4 94.9 167.4 204 167.5 179.6 Apr............ 128.4 128.0 126.3 136.1 112.9 134.7 129.2 128.5 | 189.0 119.9 95.5 166.1 205 168.2 181.3 May.......... 129.6 128.8 127.2 137.3 113.2 135.0 131.0 129.3 \ 73.0 205.0 119.8 95.4 '170.7 202 169.2 181.8 Juner........ 130.1 129.1 127.2 137.3 113.4 136.4 131.6 130.0 j 187.0 119.8 95.2 171.4 206 170.1 183.1 July........... 130.4 129.4 127.4 137.3 113.8 136.8 132.0 130.4 120.1 95.0 171.7 203 184.3 A Revised data for 1955-62, comparable to the revised data beginning Capacity utilization: Based on data from Federal Reserve, McGraw- 1963 shown below, will be published later. Hill Economics Department, and Dept, of Commerce. 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; Note.—All series: Data are seasonally adjusted unless otherwise noted. includes data for Alaska and Hawaii beginning with 1959. Prices: Bureau of Labor Statistics data. CONSTRUCTION CONTRACTS AND PRIVATE HOUSING PERMITS (In millions of dollars, except as noted) 1975 1976 Type of ownership and 1974 1975 type of construction June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June rotal construction contracts 1......... 93,685 90,237 9,324 9,04410,037 7,692 7,767 5,573 5,431 6,390 6,149 8,908 9,408 9,836 10,533 By type of ownership: Public............................................ 32,062 31,415 3,891 3,784 3,040 2,725 2,544 1,597 1,724 1,655 1,719 2,192 2,383 3,915 3,136 Private 1....................................... 61,623 58,822 5,432 5,260 6,997 4,967 5,223 3,976 3,708 4,734 4,430 6,716 7,025 5,921 7,397 By type of construction: Residential building 1............... 33,567 31,347 3,116 3,093 2,784 2,966 3,189 2,404 2,233 2,157 2,546 3,618 4,003 3,955 4,166 Nonresidential building............ 33,131 30,577 3,169 3,165 2,666 2,526 2,629 1,859 1,865 1,939 1,996 2,561 2,741 2,819 2,805 Nonbuilding................................ 26,987 28,313 3,040 2,786 4,587 2,200 1,949 1,309 1,334 2,294 1,608 2,729 2,664 3,062 3,562 5rivate housing units authorized.. . 1,074 r924 r938 '1,016 995 '1,092 '1,111 '1,127 '1,091 '1,147 '1,165 '1,188 '1,082 1,158 1,122 (In thousands, S.A., A.R.) 1 Because of improved procedures for collecting data for 1-family homes, Note.—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

AUGUST 1976 □ CONSTRUCTION A51 VALUE OF NEW CONSTRUCTION ACTIVITY (In millions of dollars) Private Public 1 Nonresidential Conser­ Period Total d R e e n s ti i a ­ l Buildings P U ub ti l l i ­ c Total M ta i r l y i­ H w ig ay h­ de v v a a e n t l i d o o n p - Other Total In tr d i u al s­ m C e o rc m ia ­ l b O u t i h l e d r ­ O i a t t i n h e d e s r ment ings 2 196 7 78,082 52,546 25.564 26,982 25,536 695 8,591 2,124 14,126 196 8 87,093 59,488 30.565 28,923 6,021 7,761 4,382 10,759 27,605 808 9,321 1,973 15,503 196 9 93,917 65,953 33,200 32,753 6,783 9,401 4,971 11.598 27,964 879 9,250 1,783 16,052 197 0 94,855 66,759 31,864 34,895 6,518 9,754 5,125 13,498 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 2 124,085 93,901 54,288 39,613 4,676 13,464 5,898 15,575 30,184 1,087 10,429 2,172 16,496 197 3 r137,917 105,412 59,727 45,685 6,243 15,453 5,888 18,101 32,505 *•1,166 *•10,505 2,313 *•18,521 197 4 138,526 100,179 50,378 49,801 7,902 15,945 5,797 20,157 38,347 *•1,188 *•12,069 *•2,741 *•22,349 197 5 132,043 93,034 46,476 46,558 8,017 *•12,804 5,585 *•20,152 39,009 *•1,391 *•10,345 *•3,227 *•24,046 1975—June. 1/9,666 90,589 44,738 45,851 8,121 12,185 5,476 20.069 39,077 1,209 *•10,715 *•3,190 *■23,963 July.. 133,096 91,970 46,123 45,847 8,175 12,334 5,449 19,889 41,126 1,339 *•11,402 *•3,275 *•25,110 Aug.. 132,178 92.062 46,332 45,730 8,045 12,365 5,581 19,739 40,116 1,403 *■11,010 *•3,454 *■24,249 Sept.. 136,310 95,365 48,375 46,990 7,895 12,369 5,820 20,906 40,945 1.597 *■10,738 *•3,429 *•25,181 Oct... 136,204 95,561 49,396 46,165 7,591 12,418 5,604 20,552 40,643 1,500 *•10,425 *•3,314 *•25,404 Nov.. 138,040 97,346 50,409 46,937 7,720 12,420 5,754 21,043 40,694 1,617 *■10,389 *■3,575 *•25,113 Dec.. 137,833 98.063 52,061 46,002 7,582 12,209 5,608 20,603 39,770 1,583 *•10,423 *•3,670 *•24,094 1976—Jan... 136,898 99,530 53,087 46,443 7,522 11,479 5,843 21.599 37,368 1,505 *•9,808 *•3,295 *•22,760 Feb.. 139,253 102,858 55,625 47,233 7,842 12,762 6,024 20,605 36,395 1.598 *•9,018 *•3,751 *•22,028 Mar.. 144,458 106,441 57,464 48,977 7,605 13,346 5,957 22.069 38,017 1,454 *•9,632 *•3,385 *•23,546 Apr.. r142,006 r104,109 *•56,037 48,072 7,227 12,604 5,567 22,674 *•37,897 *•1,522 *•10,575 *-3,760 *•22,040 May. r140,281 "104,065 *■55,108 *•48,957 *■6,967 *•12,331 5,967 *•23,692 36,216 1,435 *•9,817 r3,523 *21,441 June? 142,496 103,923 56,084 47,839 6,712 11,772 6,021 23.334 38,573 1,370 l Data beginning Jan. 1976 are not strictly comparable with prior data 2 Includes religious, educational, hospital, institutional, and other build­ because of change by Census Bureau in its procedure for estimating con­ ings. struction outlays of State and local governments. Such governments accounted for 86 per cent of all public construction expenditures in 1974. Note.—Census Bureau data; monthly series at seasonally adjusted annual rates. PRIVATE HOUSING ACTIVITY (In thousands of units) Starts Completions Under construction New 1-family homes sold (end of period) and for sale i Median prices Units (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 Sold (end of Sold sale per­ iod) 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 1,399 807 591 885 350 535 413 448 228 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 1,338 888 450 1,692 931 760 1,189 516 673 329 501 407 35.9 36.2 197 5 ^1,160 892 268 1,297 866 430 1,003 531 472 216 544 383 39.3 38.9 1975—June., 1,080 874 206 1,202 808 394 1,045 517 528 201 551 379 37.9 37.2 July. . 1,207 916 291 1,261 882 379 1,039 521 518 213 548 381 38.6 37.4 Aug.. 1,264 979 285 1,267 880 387 1,036 528 507 225 573 378 38.2 37.8 Sept.. 1,304 966 338 1,315 969 346 1 ,037 532 505 228 571 384 39.7 38.2 Oct.. , 1,431 1,093 338 1,115 738 377 1,061 560 504 235 610 389 40.7 38.4 Nov.. 1,381 1,048 333 1,386 992 394 1,037 555 482 230 660 381 41.1 38.6 Dec.., 1,283 962 321 1,329 993 336 1,038 559 479 224 641 378 42.1 38.9 1976—Jan... 1,236 957 279 1,213 926 287 1,041 562 479 263 573 379 41.6 39.1 Feb.., 1,547 1,295 252 1,299 953 346 1,053 582 471 287 *•679 *•384 *•42.7 39.3 Mar.. 1,417 1,110 307 *•1,399 *•1,032 367 *•1,055 592 463 244 *•574 389 *•43.7 *•39.6 Apr.. *•1,367 *•1,055 *•312 *•1,266 *■984 *•282 *•1,061 *•599 462 237 *•628 *•394 r43.7 *•39.9 May., *•1,430 rl,067 *•363 1,331 *•915 *■416 1,055 *•602 453 *•260 514 399 *•43.2 40.2 June** 1,492 1,150 342 231 1 Merchant builders only. for mobile homes, which are private, domestic shipments as reported by the Mobile Home Manufactured Housing Institute and seasonally ad­ Note.—All series except prices, seasonally adjusted. Annual rates for justed by Census Bureau. Data for units under construction seasonally starts, completions, mobile home shipments, and sales. Census data except adjusted by Federal Reserve. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A52 EMPLOYMENT a AUGUST 1976 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 t u . u S l l t a . n A i t o o i . o n n ) n a - l la ( b N N o . o r S t . f A i o n . r ) ce T l ( f a S o o b . r A t c o a e . r l ) Total Total E In m c n u p o l l t n o u a r y a g e l r d i- 1 In U pl n o e y m ed ­ U ( n p e e m r S a r m . e t A c e p n e . 2 l t ) n o y t; ­ industries agriculture 1970............................. 140,182 54,280 85,903 82,715 78,627 75,165 3,462 4,088 4.9 1971............................. 142,596 55,666 86,929 84,113 79,120 75,732 3,387 4,993 5.9 1972............................. 145,775 56,785 88,991 86,542 ,81,702 78,230 3,472 4,840 5.6 1973............................. 148,263 57,222 91,040 88,714 84,409 80,957 3,452 4,304 4.9 1974............................. 150,827 57,587 93,240 91,011 c85,935 82,443 3,492 5,076 5.6 1975............................. 153,449 58,655 94,793 92,613 84,783 81,403 3,380 7,830 8.5 1975—July................. 153,585 56,540 95,249 93,063 84,967 81,528 3,439 8,096 8.7 Aug.................. 153,824 57,331 95,397 93,212 85,288 81,824 3,464 7,924 8.5 Sept................. 154,052 59,087 95,298 93,128 85,158 81,646 3,512 7,970 8.6 Oct................... 154,256 58,825 95,377 93,213 85,151 81,743 3,408 8,062 8.6 Nov................. 154,476 59,533 95,272 93,117 85,178 81,877 3,301 7,939 8.5 Dec.................. 154,700 59,812 95,286 93,129 85,394 82,158 3,236 7,735 8.3 1976—Jan................... 154,915 60,110 95,624 93,484 86,194 82,851 3,343 7,290 7.8 Feb.................. 155,106 60,163 95,601 93,455 86,319 83,149 3,170 7,136 7.6 Mar................. 155,325 60,065 95,866 93,719 86,692 83,513 3,179 7,027 7.5 Apr.................. 155,516 59,898 96,583 94,439 87,399 83,982 3,417 7,040 7.5 May................. 155,711 59,988 96,699 94,557 87,697 84,368 3,329 6,860 7.3 June................. 155,925 57,674 96,780 94,643 87,500 84,206 3,294 7,143 7.5 July................. 156,142 56,817 97,473 95,333 87,907 84,566 3,341 7,426 7.8 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) Period Total M t a u n ri u n f g ac­ Mining c C o o n t n i s o t t r r n a u c c t ­ Tr ti a p o n u n s b p l a o i n c r d ta ­ Trade Finance Service G m ov e e n r t n­ utilities 70,920 19,349 623 3,536 4,504 15,040 3,687 11,621 12,561 71,216 18,572 603 3,639 4,457 15,352 3,802 11,903 12,887 73,711 19,090 622 3,831 4,517 15,975 3,943 12,392 13,340 76,896 20,068 644 4,015 4,644 16,674 4,091 13,021 13,739 78,413 20,046 694 3,957 4,696 17,017 4,208 13,617 14,177 1975............................................................... 76,987 18,342 745 3,462 4,499 16,949 4,473 13,996 14,771 SEASONALLY ADJUSTED 1975—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................................................... 77,310 18,417 752 3,432 4,467 17,045 4,239 14,113 14,845 Oct.................................................... 77,555 18,493 774 3,402 4,476 17,043 4,246 14,157 14,964 77,574 18,482 766 3,409 4,496 17,010 4,248 14,188 14,975 Dec.................................................... 77,796 18,568 769 3,406 4,477 17,080 4,264 14,229 15,003 1976—Jan..................................................... 78,179 18,722 764 3,428 4,494 17,233 4,266 14,307 14,965 Feb.................................................... 78,368 18,763 763 3,375 4,517 17,326 4,266 14,360 14,998 Mar................................................... 78,630 18,877 770 3,366 4,498 17,386 4,276 14,422 15,035 Apr.................................................... 78,963 18,973 772 3,399 4,510 17,444 4,293 14,498 15,074 May.................................................. '78,923 '18,964 773 '3,386 '4,498 '17,439 4,278 '14,514 15,071 June.................................................. '78,900 '18,938 '780 '3,355 '4,487 '17,452 '4,300 '14,527 '15,061 July*..............................:................ 79,121 18,931 790 3,360 4,496 17,518 4,305 14,574 15,147 NOT SEASONALLY ADJUSTED 1975—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................................................... 77,614 18,694 758 3,659 4,503 17,084 4,243 14,113 14,560 Oct.................................................... 78,193 18,687 763 3,620 4,503 17,136 4,238 14,185 15,061 78,339 18,635 763 3,522 4,509 17,313 4,235 14,174 15,188 Dec.................................................... 78,527 18,584 763 3,338 4,477 17,737 4,243 14,158 15,227 1976—Jan.................................................... 77,091 18,495 756 3,061 4,440 17,026 4,223 14,049 15,041 Feb.................................................... 77,339 18,545 752 3,014 4,445 16,926 4,228 14,188 15,241 Mar................................................... 77,906 18,679 759 3,103 4,462 17,028 4,246 14,307 15,322 Apr.................................................... 78,688 18,813 766 3,270 4,474 17,295 4,276 14,498 15,296 May.................................................. '79,115 '18,872 775 '3,386 '4,494 '17,405 4,278 '14,616 15,289 June.................................................. '79,760 '19,103 '796 '3,516 '4,541 '17,544 '4,347 '14,745 '15,168 July*................................................. 78,817 18,805 806 3,568 4,536 17,468 4,370 14,734 14,530 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 bench­ mark. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ PRICES A53 CONSUMER PRICES (1967 = 100) Housing Health and recreation Period it A em ll s Total Rent o H w s o h n m i e p e r- - F c a o o u n i a e d l l l tr e G a i l c n e a i c d s t ­ y o n F i p a n i n u e s g r h d r s a ­ ­ ­ A up p a k p n e a d e re p l T p t o r i a o r n t n a s ­ ­ Total M c ic a e a r d e l ­ s P c o a e n r r a e ­ l r R e a i c e n n r a g d e d a ­ ­ g O s a o e t n o h rv d d e ­ s r tion tion ices 1929........... 51.3 48.3 76.0 48.5 1933........... 38.8 30.6 54.1 36.9 1941........... 44.1 38.4 53.7 57.2 40.5 81.4 44.8 44.2 37.0 41.2 47.7 49.2 1945........... 53.9 50.7 59.1 58.8 48.0 79.6 61.5 47.8 42.1 55.1 62.4 56.9 1960........... 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 87.3 87.8 196 5 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 95.9 94.2 196 6 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 97.5 97.2 196 7 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 196 8 104.2 103.6 104.2 102.4 105.7 103.1 100.9 104.4 105.4 103.2 105.0 106.1 104.2 104.7 104.6 196 9 109.8 108.9 110.8 105.7 116.0 105.6 102.8 109.0 111.5 107.2 110.3 113.4 109.3 108.7 109.1 197 0 116.3 114.9 118.9 110.1 128.5 110.1 107.3 113.4 116.1 112.7 116.2 120.6 113.2 113.4 116.0 197 1 121.3 118.4 124.3 115.2 133.7 117.5 114.7 118.1 119.8 118.6 122.2 128.4 116.8 119.3 120.9 197 2 125.3 123.5 129.2 119.2 140.1 118.5 120.5 121.0 122.3 119.9 126.1 132.5 119.8 122.8 125.5 197 3 133.1 141.4 135.0 124.3 146.7 136.0 126.4 124.9 126.8 123.8 130.2 137.7 125.2 125.9 129.0 197 4 147.7 161.7 150.6 130.6 163.2 214.6 145.8 140.5 136.2 137.7 140.3 150.5 137.3 133.8 137.2 197 5 161 .2 175.4 166.8 137.3 181.7 235.3 169.6 158.1 142.3 150.6 153.5 168.6 150.7 144.4 147.4 1975—June 160.6 174.4 166.4 136.9 181.4 230.6 169.4 158.1 141.4 149.8 153.2 168.1 150.3 144.1 147.3 July. 162.3 178.6 167.1 137.3 182.3 234.1 170.4 158.3 141.1 152.6 154.0 169.8 151.2 144.4 147.6 Aug. 162.8 178.1 167.7 138.0 182.8 235.7 171.2 158.8 142.3 153.6 154.6 170.9 151.4 144.7 148.1 Sept. 163.6 177.8 168.9 138.4 183.9 238.7 174.0 160.1 143.5 155.4 155.4 172.2 152.1 146.0 148.0 Oct.. 164.6 179.0 169.8 139.3 184.8 243.3 174.2 160.9 144.6 156.1 156.3 173.5 152.9 146.6 148.5 Nov. 165.6 179.8 171.3 139.9 186.8 246.5 176.8 161.6 145.5 157.4 156.5 173.3 153.6 147.0 148.9 Dec. 166.3 180.7 172.2 140.6 187.8 248.7 179.0 162.0 145.2 157.6 157.5 174.7 154.6 147.5 149.8 1976—Jan.. 166.7 180.8 173.2 141.2 188.8 248.9 179.5 163.7 143.3 158.1 158.6 176.6 155.7 148.2 150.5 Feb. 167.1 180.0 173.8 142.1 188.6 249.4 181.9 165.2 144.0 158.5 159.7 178.8 157.0 148.5 151.3 Mar. 167.5 178.7 174.5 142.7 188.7 247.6 183.7 166.6 145.0 159.8 160.6 180.6 157.4 149.0 151.8 Apr. 168.2 179.2 174.9 143.2 188.9 246.6 184.4 167.4 145.7 161.3 161.4 181.6 158.3 149.5 152.5 May 169.2 180.0 175.6 143.8 189.6 246.2 186.1 167.9 146.8 163.5 162.1 182.6 158.9 150.3 152.9 June 170.1 180.9 176.5 144.4 190.7 247.3 188.5 168.5 146.9 165.9 162.8 183.7 159.8 150.9 153.2 Note.—Bureau of Labor Statistics index for city wage earners and clerical workers. WHOLESALE PRICES: SUMMARY (1967 = 100, except as noted) Industrial commodities All Pro­ Period m c t o i o e m d s i ­ ­ p F u r a c o r t d m s ­ c f f e o a e s n e o 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 tc e . l, C ic e h a t e c l m s . , ­ R b et u e c r b . , ­ L b e u e tc 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 r e u i y a d n n i ­ p ­ t ­ F t e u u t r r c e n . , i­ N t e m m a r l o a i l e n l n i ­ s c ­ ­ T e m p t q r o i a e o u r n n n i t p a s t1 ­ ­ ­ n c M e e o l i l u s a ­ s ­ 1960......................... 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 1965......................... 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 1966......................... 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 1967......................... 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 1968......................... 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 1969......................... 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 1970......................... 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 1971......................... 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 1972......................... 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 1973......................... 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 1974......................... 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 1975 ......................... 174.9 186.7 182.6 171.5 137.9 148.5 245.1 181.3 150.2 176.9 170.4 185.9 161.4 139.7 174.0 141.5 147.7 1975—July.............. 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 Aug.............. 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 Sept.............. 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 Oct............... 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 Nov.............. 178.2 191 .7 182.6 175.4 143.2 154.4 257.0 182.9 151.8 178.3 171 .3 187.0 165.3 141 .5 177.7 147.2 148.6 Dec............... 178.7 193.8 181.0 176.1 144.0 154.6 258.0 183.4 151.9 183.1 173.1 187.1 165.8 142.0 178.0 147.5 151.1 1976—Jan................ 179.3 192.8 179.4 177.3 145.1 157.5 257.3 184.2 152.4 190.5 174.8 187.7 167.0 143.1 181.1 148.7 151.8 Feb............... 179.3 191.0 176.4 178.0 146.3 159.9 255.7 184.9 154.2 196.0 175.8 189.2 167.7 143.4 181.3 148.8 152.1 Mar.............. 179.6 187.2 175.8 178.9 146.7 162.0 255.7 185.6 155.5 202.3 176.9 190.6 168.2 143.9 182.5 149.1 152.6 Apr............... 181.3 192.9 178.0 180.0 147.4 165.4 256.9 187.1 156.7 203.3 178.5 192.9 168.9 144.4 185.2 149.2 152.4 May............. 181.8 192.6 179.9 180.4 147.0 169.6 257.2 186.9 157.1 202.3 179.2 194.0 169.4 144.8 185.6 149.0 152.7 June............. 183.1 196.5 181.8 181.3 148.1 167.4 260.3 187.1 157.2 199.8 179.5 196.4 170.2 145.3 186.0 149.1 154.4 July.............. 184.3 196.9 182.6 182.6 149.0 169.8 265.0 187.0 158.2 203.7 180.5 198.7 170.9 145.7 186.9 149.2 153.8 i Dec. 1968 = 100. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 NATIONAL PRODUCT AND INCOME □ AUGUST 1976 GROSS NATIONAL PRODUCT (In billions of dollars) 1975 1976 Item 1950 1970 1972 1973 1974 1975 III IV Up Gross national product...................................... 286.2 982.41,171.1 1.306.6 1,413.2 1,516.3 1.482.3 1,548.7 1,588.2 1,636.2 1,673.0 Final purchases..................................................... 279.4 978.6 1,161.7 1.288.6 1,402.5 1,531.0 1.512.3 1,550.6 1,592.5 1,621.4 1,659.7 Personal consumption expenditures................ 192.0 618.8 733.0 809.9 887.5 973.2 960.3 987.31,012.01,043.6 1,064.6 Durable goods................................................ 30.8 84.9 111.2 123.7 121.6 131.7 127.0 136.0 141 151.4 154.1 Nondurable goods........................................ 98.2 264.7 299.3 333.8 376.2 409.1 405.8 414.6 421.6 429.1 434.8 Services........................................................... 63.0 269.1 322.4 352.3 389.6 432.4 427.4 436.7 448.6 463.2 475.6 Gross private domestic investment.................. 53.8 140.8 188.3 220.0 215.0 183.7 164.4 196.7 201.4 229.6 236.3 Fixed investment......................................... 47.0 137.0 178.8 202.1 204.3 198.3 194.3 198.6 205.7 214.7 223.0 Nonresidential............................................... 27.1 100.5 116.8 136.0 149.2 147.1 145 146.1 148.7 153.4 158.5 Structures................................................ 9.3 37.7 42.5 49.0 54.1 52.0 51.2 51.8 52.1 53.2 55.3 Producers’ durable equipment........... 17.8 62. 74.3 87.0 95.1 95.1 94.6 94.3 96.6 100.2 103.1 Residential structures............................... 19.9 36.6 62.0 66.1 55.1 51.2 48.6 52.6 57.0 61.3 64.5 Nonfarm.................................................. 18.7 35.1 60.3 64.3 52.7 49.0 46.7 50.2 54.2 58.6 62.1 Change in business inventories................... 6 3.8 9.4 17.9 10.7 -14.6 -30.0 -2.0 -4.3 14 13.3 Nonfarm...................................................... 6.0 3.7 8.8 14.7 12.2 -17.6 -31.2 -4.2 -9.5 12.7 14.7 Net exports of goods and services.................. 1.9 3.9 -3.3 7.1 7.5 20.5 24.4 21.4 21.0 8.4 9.1 Exports............................................................ 13.9 62.5 72.7 101.6 144.4 148.1 142.9 148.2 153.7 154.1 156.8 Imports............................................................ 12.0 58.5 75.9 94.4 136.9 127.6 118.5 126.8 132.7 145.7 147.7 Government purchases of goods and services, 38.5 218.9 253.1 269.5 303.3 339.0 333.2 343.2 353.8 354.7 363.1 Federal............................................................... 18.7 95.6 102.1 102.2 111.6 124.4 122.4 124.6 130.4 129.2 132.3 National defense........................................ 14.0 73.5 73.5 73.5 77.3 84.3 83.4 84.6 87.1 86.2 88.4 Other............................................................ 4.7 22.1 28.6 28.7 34.3 40.1 39.0 40.0 43.2 42.9 43.9 State local........................................................ 19. 123.2 151.0 167.3 191.6 214.5 210.9 218.6 223.4 225.5 230.8 Gross national product in 1972 dollars.......... 533.5 1,075.3 1,171.1 1,235.0 1,214.01,191.7 1,177.1 1,209.3 1,219.2 1,246.3 1,259.7 Note.—Dept, of Commerce estimates. Quarterly data are seasonally adjusted totals at annual rates. For back data and explanation of series, see the Survey of Current Business, Jan. 1976. NATIONAL INCOME (In billions of dollars) 1975 1976 Item 1950 1970 1972 1973 1974 1975 II III IV II p National income..................................................................... 236.2 798.4 951.9 1,064.6 1,135.7 1,207.6 1,182.7 1,233.4 1,264.6 1,304.7 Compensation of employees................................................ 154.8 609.2 715.1 799.2 875.8 928.8 912.9 935.2 963.1 994.41,016.9 Wages and salaries............................................................... 147.0 546.5 633.8 701.2 764.5 806.7 792.8 811.7 836.4 861.5 880.7 Private............................................................................. 124.4 430.5 496.2 552.6 604.1 630.8 619.0 634.4 654.1 676.1 692.1 Government and govt, enterprises........................... 22.6 116.0 137.6 148.6 160.4 175.8 173 177.3 182.2 185.4 188.7 Supplements to wages and salaries.................................. 7.8 62.7 81.4 98.0 111.3 122.1 120.1 123.5 126.7 132.9 136.2 Employer contributions for social insurance.......... 4.2 30.7 39.4 49.3 55 59.7 58.7 60.2 61.6 65.9 67.1 Other labor income...................................................... 3.7 32.0 42.0 48.7 55.5 62.5 61.4 63.3 65.2 67.1 69.0 Proprietors’ income with inventory valuation and capital consumption adjustments.................................... 38.4 65.1 76.1 92.4 86.9 90.2 86.8 95.5 97.2 93.2 100.0 Business and professional........................................... 24.9 51.2 58.1 60.4 61.1 65.3 62.7 66.3 69.0 71.4 72.6 Farm............................................................................... 13.5 13.9 18.0 32.0 25.8 24.9 24.1 29.2 28.3 21.9 27.5 Rental income of persons with capital consumption adjustment...................................................................... 7.1 18.6 21.5 21.6 21.0 22.4 22.3 22.4 22.9 23.3 23.1 Corporate profits and inventory valuation adjustment and without capital consumption adjustment................. 37.6 66.4 89.6 97.2 87.8 103.1 97.9 117.9 119.1 129.6 Profits before tax................................................................... 42.6 71.5 96.2 115.8 127.6 114.5 105.8 126.9 131.3 141.1 Profits tax liability....................................................... 17.9 34.5 41.5 48.7 52.4 49.2 44. 54.8 57.2 61.4 Profits after tax................................................................. 24.7 37.0 54.6 67.1 75.2 65.3 61.0 72.1 74.1 79.7 Dividends................................................................... 8.8 22.9 24.6 27.8 30.8 32.1 31.9 32.6 32.2 33.1 34.4 Undistributed profits............................................... 15.9 14.1 30.0 39.3 44.4 33.2 29.1 39.5 41.9 46.6 Inventory valuation adjustment.................................... -5.0 -5.1 -6.6 -18.6 -39.8 -11.4 -7.8 -9.0 -12.3 -11.5 -14.2 Capital consumption adjustment.................................. -4.0 1.5 2.5 1.9 -3.0 -11.6 -11.4 -12.6 -13.5 -14.5 -15.4 Net interest............................................................................. 2.3 37.5 47.0 52.3 67.1 74.6 74.0 74.9 75.8 78.6 80.3 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

AUGUST 1976 □ NATIONAL PRODUCT AND INCOME A55 RELATION OF GROSS NATIONAL PRODUCT, NATIONAL INCOME, AND PERSONAL INCOME AND SAVING (In billions of dollars) 1975 1976 1950 1970 1972 1973 1974 1975 II III IV Up Gross national product........................................................... 286.2 982.41,171.1 1,306.6 1,413.2 1,516.3 1,482.3 1,548.7 1,588.2 1,636.2 1,673.0 Less: Capital consumption allowances with capital consumption adjustment...................................... 23.9 90.8 105.4 117.7 137.7 161.4 158.7 164.4 169 173 177.7 Indirect business tax and nontax liability............... 23.4 94.0 111.0 120.2 128.4 138.7 136 141.5 144.1 144.9 147.9 Business transfer payments...................................... .8 4.0 4.7 5.4 5.6 6.3 6.2 6.4 6.6 6.8 7.0 Statistical discrepancy................................................ 2.0 -2.1 1.7 2.6 6.6 4.4 .1 5.1 6.1 7.2 Plus: Subsidies less current surplus of government enterprises................................................................ .1 2.7 3.6 3.9 .8 2.0 1.9 2.1 2.7 .9 1.1 Equals: National income. 236.2 798.4 951.9 1,064.6 1,135.7 1,207.6 1,182.7 1,233.4 1,264.6 1,304.7 Less: Corporate profits with inventory valuation and capital consumption adjustments....................... 33.7 67.9 92.1 99.1 84.8 91.6 86.6 105.3 105.6 115.1 Net interest................................................................... 2.3 37.5 47.0 52.3 67.1 74.6 74.0 74.9 75.8 78.6 80.3 Contributions for social insurance......................... 7.1 58.7 73.6 91.5 103.4 109.7 108.1 110.3 112.6 119.3 121.4 Wage accruals less disbursements........................... Plus: Government transfer payments to persons. 14.4 75.9 99.4 113.5 134.6 168.9 169.3 172.7 176.0 181.8 180.7 Personal interest income................................. 8.9 64.3 74.6 84.1 101.4 110.7 109.0 111.0 114.4 118.0 120.7 Dividends........................................................... 22.9 24.6 27. 30. 32.1 31.9 32.6 32.2 33.1 34.4 Business transfer payments............................ 4.0 4.7 5.4 5.6 6.3 6.2 6.4 6.6 6. 7.0 Equals: Personal income.............................. 226.1 801.3 942.5 1,052.4 ,153.3 ,249.7 ,230.3 ,265.5 ,299.7 ,331.3 ,361.4 Less: Personal tax and nontax payments. 20.6 115.3 141.2 150.8 170.4 168.8 142.2 174.0 179.8 183.8 189.6 Equals: Disposable personal income.......... 205.5 685.9 801.3 901.7 982.9 ,080.9 ,088.2 ,091.5 ,119.9 ,147.6 ,171.8 Less: Personal outlays.......................................................... 194.7 635.4 751.9 831.3 910.7 996.9 983.6 ,011.1 ,036.2 ,068.0 ,089.3 Personal consumption expenditures................... 192.0 618.8 733.0 809.9 887.5 973.2 960.3 987.3 ,012.0 ,043.6 ,064.6 Interest paid by consumer to business............... 2.3 15.5 17.9 20.2 22.2 22.8 22.4 22.8 23.3 23.4 23.7 Personal transfer payments to foreigners (Net) .4 1.1 1.0 1.3 1.0 .9 .9 .9 .9 1.0 1.0 Equals: Personal saving........................................................ 10.8 50.6 49.4 70.3 72.2 84.0 104.5 80.5 83.7 79.5 82.5 Disposable personal income in (1972) dollars. 361.9 741.6 801.3 854.7 840.8 855.5 869.7 857.1 867.5 890.2 Note.—Dept, of Commerce estimates. Quarterly data seasonally adjusted totals at annual rates. See also Note to table at top of opposite page. PERSONAL INCOME (In billions of dollars) 1975 1976 Item 1974 1975 June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June* Total personal income............................ 1153.31249.71253.71252.01267.51277.1 1290.81300.21308.21320.81331.41341.91352.51362.91368.9 Wage and salary disbursements........... 765.0 806.7 797.4 802.9 813.0 819.1 828.5 836.6 844.0 854.2 861.4 868.8 876.9 883.3 882.1 Commodity-producing industries... 273.9 275.3 269.9 272.5 276.4 279.8 282.9 285.7 288.6 292.8 294.9 298.4 301.7 303.5 303.4 211.4 211.7 207.6 209.2 212.9 215.5 218.1 220.1 222.8 227.2 229.4 232.2 234.8 235.8 235.5 Distributive industries....................... 184.4 195.6 193.3 194.4 197.9 198.2 200.9 202.5 203.5 206.5 208.8 209.8 212.3 213.9 211.7 Service industries................................ 145.9 159.9 159.4 160.0 161.6 162.4 163.6 166.0 168.8 170.8 172.4 174.1 175.3 177.2 177.4 Government........................................ 160.9 175.8 174.8 176.0 177.1 178.8 181.1 182.4 183.2 184.2 185.4 186.6 187.6 188.7 189.7 Other labor income................................ 55.5 62.5 62.0 62.6 63.3 63.9 64.5 65.2 65.8 66.4 67.1 67.7 68.4 69.0 69.7 Proprietors’ income with inventory valuation and capital consumption adjustments.......................................... 86.9 90.2 90.6 94.0 96.1 96.4 97.5 97.1 97.2 95.2 92.4 92.2 96.0 100.0 104.3 Business and professional................. 61.1 65.3 63.3 65.4 66.5 67.0 68.3 68.7 69.9 70.6 71.3 72.2 72.7 72.5 72.7 25.8 24.9 27.3 28.6 29.6 29.4 29.2 28.4 27.3 24.6 21.1 20.0 23.3 27.5 31.6 Rental income of persons with capital consumption adjustment................... 21.0 22.4 22.4 22.5 22.5 22.4 22.9 22.9 22.9 23.2 23.4 23.3 23.3 23.4 22.7 Dividends................................................. 30.8 32.1 32.0 32.3 32.6 32.9 32.9 32.9 30.8 32.9 33.3 33.0 33.4 33.9 35.9 Personal interest income....................... 101.4 110.7 109.7 110.1 110.9 112.1 113.2 114.4 115.5 116.7 117.9 119.3 120.0 120.7 121.3 Transfer payments.................................. 140.3 175.2 189.2 177.3 179.3 180.7 182.1 182.1 183.4 185.3 189.2 191.3 188.7 187.1 187.1 Less: Personal contributions for social insurance...................................... 47.6 50.0 49.6 49.8 50.2 50.4 50.7 51.0 51.4 53.1 53.4 53.7 54.1 54.4 54.4 Nonagricultural income.......................... 1117.31213.41215.41212.21226.51236.1 1249.91260.01269.1 1284.41298.61310.1 1317.31323.41325.0 Agricultural income................................ 36.0 36.3 38.3 39.8 41.0| 41.0 40.9 40.2 39.1 36.4 32.8 31.8 35.2 39.5 43.9 Note.—Dept, of Commerce estimates. Monthly data 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

A56 FLOW OF FUNDS o AUGUST 1976 SUMMARY OF FUNDS RAISED IN U.S. CREDIT MARKETS (Seasonally adjusted annual rates; in billions of dollars) 1975 Transaction category, or sector 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 HI H2 Credit market funds raised by nonfinancial sectors 1 67.9 82.4 96.0 91.8 98.2 147.4 169.4 187.4 180.1 204.6 186.7 222.2 1 2 66.9 80.0 96.0 87.9 92.4 135.9 158.9 180.1 176.2 194.6 176.2 212.8 2 3 3.6 13.0 13.4 -3.7 12.8 25.5 17.3 9.7 12.0 85.2 84.1 86.3 3 4 2.3 8.9 10.4 -1.3 12.9 26.0 13.9 7.7 12.0 85.8 85.4 86.4 4 5 1.3 4.1 3.1 -2.4 -.1 -.5 3.4 2.0 * -.6 -1.2 -.1 5 6 64.3 69.4 82.6 95.5 85.4 121.9 152.1 177.7 168.1 119.4 102.6 135.9 6 7 1 .0 2.4 * 3.9 5.8 11.5 10.5 7.2 3.8 9.9 10.5 9.4 7 8 63.3 67.0 82.6 91.6 79.7 110.4 141.6 170.4 164.2 109.4 92.1 126.5 8 9 Private domestic nonfinancial sectors......... 62.7 6.45 79.7 91.8 82.7 117.3 147.8 170.1 152.7 106.3 93.0 119.4 9 10 1.3 2.4 -.2 3.4 5.7 11.4 10.9 7.4 4.1 9.9 10.3 9.5 10 11 61.5 63.0 79.9 88.4 77.0 105.8 136.9 162.7 148.6 96.4 82.7 109.9 11 12 Debt capital instruments................................... 38.2 44.5 49.5 49.6 56.7 83.2 93.8 96.1 92.9 97.8 101.7 93.8 12 13 State and local obligations............................ 5.6 7.8 9.5 9.9 11.2 17.6 14.4 13.7 17.4 15.4 17.1 13.8 13 14 Corporate bonds............................................. 10.2 14.7 12.9 12.0 19.8 18.8 12.2 9.2 19.7 27.2 35.3 19.1 14 15 11.7 11.5 15.1 15.7 12.8 26.1 39.6 43.3 31.7 36.1 31.2 41.0 15 16 3.1 3.6 3.4 4.7 5.8 8.8 10.3 8.4 7.8 2.4 2.9 1.9 16 17 5.7 4.7 6.4 5.3 5.3 10.0 14.8 17.0 11.5 11.0 9.4 12.6 17 18 1.8 2.3 2.2 1.9 1.8 2.0 2.6 4.4 4.9 5.6 5.8 5.4 18 19 23.3 18.5 30.4 38.8 20.3 22.6 43.0 66.6 55.6 -1.3 -19.1 16.1 19 70 6.4 4.5 10.0 10.4 6.0 11.2 19.2 22.9 9.6 5.3 -1.5 12.0 20 21 10.9 9.8 13.6 15.5 6.7 7.8 18.9 35.8 27.3 -11.3 -20.2 -2.5 21 22 1.1 1.7 1.8 3.0 3.0 -1.2 -.5 -.4 6.6 -2.0 -1.5 -2.5 22 23 5.0 2.6 5.0 9.9 4.6 4.8 5.5 8.3 12.1 6.7 4.2 9.2 23 24 62.7 65.4 79.7 91.8 82.7 117.3 147.8 170.1 152.7 106.3 93.0 119.4 24 25 State and local governments............................ 6.3 7.9 9.8 10.7 11.3 17.8 14.2 12.3 16.6 13.2 14.8 11.6 25 26 Households........................................................... 22.7 19.3 30.0 31.7 23.4 39.8 63.1 72.8 44.0 45.2 36.2 54.1 26 27 3.1 3.6 2.8 3.2 3.2 4.1 4.9 8.6 7.8 9.2 8.2 10.2 27 28 5.4 5.0 5.6 7.4 5.3 8.7 10.4 9.3 7.2 2.9 .2 5.4 28 29 25.3 29.6 31.6 38.9 39.5 46.8 55.3 67.2 77.1 35.8 33.6 38.1 29 30 1.5 4.0 2.8 3.7 2.7 4.6 4.3 7.5 15.4 13.0 9.6 16.4 30 31 -.3 .1 .2 .5 .1 * -.4 -.2 -.3 * .1 -.1 31 32 1.8 4.0 2.7 3.2 2.7 4.6 4.7 7.7 15.7 13.0 9.5 16.6 32 33 .7 1.2 1.1 1.0 .9 .9 1.0 1.0 2.2 6.3 5.9 6.7 33 34 -.2 -.3 -.5 -.2 -.3 1.6 2.9 2.8 4.7 4.0 1.4 6.6 34 35 -.1 .5 -.2 .3 .8 .3 -1.0 2.2 7.1 -.1 -1.2 1.0 35 36 1 .3 2.6 2.2 2.1 1.3 1.8 1.8 1.7 1.7 2.8 3.4 2.3 36 37 Memo: U.S. Govt, cash balance.................................. -.4 1.2 -1.1 .4 2.8 3.2 -.3 -1.7 -4.6 2.9 2.7 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 95.5 144.2 169.7 189.0 184.7 201.7 184.0 219.1 38 39 By U.S. Government.................................................. 4.0 11.8 14.6 -4.1 10.0 22.3 17.6 11.4 16.6 82.3 81.4 83.2 39 Credit market funds raised by financial sectors 1 11.7 2.0 18.3 33.7 12.6 16.5 28.9 52.0 38.0 12.1 4.9 19.3 1 2 Sponsored credit agencies.......................................... 4.8 -.6 3.5 8.8 8.2 3.8 6.2 19.6 22.1 11.0 9.1 13.0 2 3 U.S. Government securities.................................. 5.1 -.6 3.2 9.1 8.2 3.8 6.2 19.6 21 .4 10.2 8.0 12.3 3 4 Loans from U.S. Government............................. -.2 -.1 .2 -.3 .7 .9 1.1 .6 4 5 Private financial sectors............................................. 6.9 2.6 14.9 24.9 4.3 12.7 22.8 32.4 15.9 1.1 -4.2 6.3 5 6 3.7 3.0 6.4 6.1 4.6 3.3 2.4 .8 1.7 1.8 2.1 1.5 6 7 Debt instruments...................................................... 3.2 -.4 8.5 18.8 -.3 9.3 20.3 31.6 14.2 -.7 -6.3 4.8 7 8 Corporate bonds................................................. .9 1.3 1.1 1.5 3.1 5.1 7.0 2.3 1 .4 3.1 3.0 3.3 8 9 Mortgages............................................................. -.9 1.0 .4 .2 .7 2.1 1.7 -1 .2 -1.3 2.3 2.0 2.6 9 10 Bank loans n.e.c.................................................. -1.0 -2.0 2.5 2.3 -.5 3.0 6.8 13.5 7.5 -5.3 -7.9 -2.7 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 3.1 4.6 1.5 11 12 Loans from FHLB’s.......................................... .9 -2.5 .9 4.0 1.3 -2.7 * 7.2 6.7 -4.0 -8.1 .2 12 13 11.7 2.0 18.3 33.7 12.6 16.5 28.9 52.0 38.0 12.1 4.9 19.3 13 14 Sponsored credit agencies.......................................... 4.8 -.6 3.5 8.8 8.2 3.8 6.2 19.6 22.1 11.0 9.1 13.0 14 15 Private financial sectors............................................. 6.9 2.6 14.9 24.9 4.3 12.7 22.8 32.4 15.9 1.1 -4.2 6.3 15 16 Commercial banks.................................................. -.1 .1 1.2 1.4 -3.1 2.5 4.0 4.5 -1.9 3.3 4.6 2.1 16 17 Bank affiliates........................................................... 4.2 -1.9 -.4 .7 2.2 2.4 .3 .9 — 3 17 18 Foreign banking agencies...................................... .1 * .1 .2 .1 1.6 .8 5.1 2.9 -.3 -.9 .2 18 19 Savings and loan associations.............................. .1 -1.7 1.1 4.1 1 .8 -.1 2.0 6.0 6.3 -2.1 -8.0 3.8 19 20 Other insurance companies.................................. .1 .1 .2 .5 .4 .6 .5 .5 .4 .7 .8 .7 20 21 Finance companies................................................. 3.1 1.2 5.7 8.3 1.6 4.2 9.3 9.4 3.9 -.9 -2.5 .8 21 22 REIT’s....................................................................... .7 1.3 2.7 3.0 6.1 6.3 1.0 -1.6 -1.8 -1.4 22 23 Open end investment companies......................... 3.7 3.0 5.8 4.8 2.6 1.1 -.7 -1.6 1.0 1.6 2.7 .5 23 Total credit market funds raised, all sectors, by type 1 Total funds raised............................................................ 79.6 84.4 114.3 125.5 110.8 163.9 198.3 239.4 218.1 216.6 191.6 241.5 1 2 Investment company shares...................................... 3.7 3.0 5.8 4.8 2.6 1.1 -.7 -1.6 1.0 1.6 2.7 .5 2 3 Other corporate equities............................................ 1.1 2.5 .6 5.2 7.7 13.6 13.6 9.6 4.6 10.1 9.8 10.4 3 4 Debt instruments.......................................................... 74.9 79.0 107.9 115.5 100.4 149.1 185.4 231.3 212.5 204.9 179.0 230.6 4 5 U.S. Government securities.................................. 8.8 12.5 16.7 5.5 21.1 29.4 23.6 29.4 33.5 95.4 92.0 98.9 5 6 State and local obligations.................................... 5.6 7.8 9.5 9.9 11.2 17.6 14.4 13.7 17.4 15.4 17.1 13.8 6 7 Corporate and foreign bonds............................... 11.8 17.2 15.0 14.5 23.8 24.8 20.2 12.5 23.3 36.7 44.2 29.1 7 8 Mortgages................................................................. 21.3 23.0 27.4 27.8 26.4 48.9 68.8 71.9 54.5 57.3 51.4 63.2 8 9 Consumer credit...................................................... 6.4 4.5 10.0 10.4 6.0 11.2 19.2 22.9 9.6 5.3 -1.5 12.0 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 -12.6 -26.7 1.3 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 .9 1.9 * 11 12 Other loans............................................................... 6.9 2.5 8.3 15.8 7.3 4.0 7.4 17.2 21.1 6.4 .6 12.2 12 Note.—Full statements for sectors and transaction types quarterly, and Flow of Funds Section, Division of Research and Statistics, Board of annually for flows and for amounts outstanding, may be obtained from Governors of the Federal Reserve System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ FLOW OF FUNDS A57 DIRECT AND INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS (Seasonally adjusted annual rates; in billions of dollars) 1975 Transaction category, or sector 19 66 1967 1968 1969 1970 1971 1972 1973 1974 1975 H2 1 Total funds advanced in credit markets to non­ financial sectors................................................ 66.9 80.0 95.9 88.0 92.5 135.9 158.9 180.1 176.2 194.6 176.2 212.8 By public agencies and foreign 2 Total net advances......................................................... 11.9 11.3 12.2 15.7 28.1 41.7 18.3 33.2 49.2 39.2 41.6 36.8 3 U.S. Government securities.................................... 3.4 6 3.4 .7 15.9 33.8 8.4 11.0 8.6 18.5 28.3 8.8 4 Residential mortgages.............................................. 2. 2.1 2. 4.6 5.7 5.7 5.2 7.6 13. 16.1 15.1 17.2 5 FHLB advances to S&L’s....................................... .9 -2.5 .9 4.0 1.3 -2.7 * 7.2 6.7 -4.0 -8.1 .2 6 Other loans and securities....................................... 4.8 4.9 5.1 6.3 5.2 4.9 4.6 7.5 20.1 8.5 6.3 10.7 By agency— 7 U.S. Government...................................................... 4.9 4.6 4.9 2.9 2. 3.2 2.6 3.0 7.4 13.3 12.7 13.9 8 Sponsored credit agencies....................................... 5.1 -.1 3.2 8.9 10.0 3.2 7.0 20.3 24.1 12.6 11.1 14.1 9 Monetary authorities................................................ 3.5 4. 3.7 4.2 5.0 8.9 .3 9.2 6.2 8.5 7.0 10.1 10 Foreign........................................................................ -1.6 2.0 .3 -.3 10.3 26.4 8.4 .7 11.6 4.7 10. -1.4 11 Agency borrowing not included in line 1................. 4.8 -.6 3.5 8.8 8.2 3. 6.2 19.6 22.1 11.0 9.1 13.0 Private domestic funds advanced 12 Total net advances......................................................... 59.8 68.1 87.2 81.1 72.6 98.1 146.7 166.5 149.1 166.4 143.7 189.0 13 U.S. Government securities.................................... 5.4 5.7 13.3 4. 5.2 -4.4 15.2 18.4 24.9 76.9 63.7 90.2 14 State and local obligations...................................... 5.6 7 9.5 9.9 11.2 17.6 14.4 13.7 17.4 15.4 17.1 13.8 15 Corporate and foreign bonds................................. 10.3 16.0 13.8 12.5 20.0 19.5 13.2 10.1 20.6 33.1 41.1 25.1 16 Residential mortgages.............................................. 12.0 13.0 15.5 15.7 12. 29.1 44.6 44.1 25.6 22.3 19.1 25.5 17 Other mortgages and loans.................................... 27.4 23.1 35.9 42.2 24.6 33.7 59.5 87.4 67.4 14 -5.3 34.7 18 Less: FHLB advances.............................................. .9 -2.5 .9 4.0 1.3 -2.7 7.2 6.7 -4.0 -8.1 .2 Private financial intermediation 19 Credit market funds advanced by private financial institutions............................................................... 45.4 63.5 75.3 55.3 74.9 110.7 153.4 158. 131.5 123.0 115.0 130.8 19 20 Commercial banks................................................... 17.5 35.9 38.7 18.2 35.1 50.6 70.5 86.6 64.6 27.3 16.3 38.2 20 21 Savings institutions.................................................... 7.9 15.0 15.6 14.5 16.9 41.4 49.3 35.1 26.9 56.0 58 53.2 21 22 Insurance and pension funds.................................. 15.5 12.9 14.0 12.7 17.3 13.3 17.7 22.1 34.3 40.1 40.0 40.2 22 23 Other finance............................................................... 4.5 -.3 7.0 9.9 5.7 5.3 15. 15.0 5.7 -.4 -.2 23 24 Sources of funds............................................................ 45.4 63.5 75.3 55.3 74.9 110.7 153.4 158.8 131.5 123.0 115.0 130.8 24 25 Private domestic deposits.......................................... 22.5 50.0 45.9 2.6 63.2 90.3 97.5 84.9 76.5 96.0 103.6 88.5 25 26 Credit market borrowing.......................................... 3.2 -.4 8.5 18. -.3 9.3 20.3 31.6 14.2 -.7 -6.3 4.8 26 27 Other sources.............................................................. 19.8 13.9 21.0 34.0 12.0 11.0 35.5 42.4 40. 27.7 17.7 37.5 28 Foreign funds.......................................................... 3.7 2.3 2.6 9.3 -8.5 -3.2 5.2 6.5 13.6 -.4 -6.3 5.6 29 Treasury balances................................................... -.5 .2 -.2 * 2.9 2.2 .7 -1.0 -5.1 -1.7 -2.3 -1.1 30 Insurance and pension reserves........................... 13.6 12.0 11.4 10.8 13.1 9.1 13.1 16.7 27.9 27.4 27.6 27.2 31 Other, net................................................................. 3.0 -.6 7.2 13.8 4.4 2.9 16.5 20.2 4.4 2.4 -1.3 5.8 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 31.8 42.7 22.5 63.0 32 33 U.S. Government securities...................................... 8.4 -1.4 8.1 17.0 -9.0 -14.0 1.6 18.8 18.1 21.2 -4 47.1 33 34 State and local obligations........................................ 2.6 -2.5 -.2 8.7 -1.2 .6 2.1 4.4 10.8 8.3 10.6 5.9 34 35 Corporate and foreign bonds................................... 2.0 4.6 4.7 6.6 10.7 9.3 5.2 1.1 -1.7 9.0 11.5 6.5 35 36 Commercial paper...................................................... 2.3 1.9 5.8 10.2 -4.4 -.6 4.0 11.3 1.6 .4 2.1 -1.4 36 37 Other............................................................................ 2.3 1.7 2.1 2.0 1.4 1.5 3.8 2.9 3.8 2.9 4.8 37 38 Deposits and currency................................................... 24.4 52.1 48.3 5.4 66.6 93.7 101.9 82.8 102.2 110.9 93.5 38 39 Time and saving accounts......................................... 20.3 39.3 33.9 -2.3 56.1 81.0 85.2 76.3 71.9 88.7 91.1 86.2 39 40 Large negotiable CD’s.......................................... -.2 4.3 3.5 -13.7 15.0 7.7 8.7 18.5 23.6 -9.7 -22.3 2.9 40 41 Other at commercial banks.................................. 13.3 18.3 17.5 3.4 24.2 32.9 30.6 29.5 26.6 39.0 44.5 33.4 41 42 At savings institutions............................................ 7.3 16.7 12.9 8.0 16.9 40.4 45.9 28.2 21.8 59.4 68.9 49.9 42 43 Money............................................................................ 4.1 12.8 14.5 7.7 10.5 12.7 16.7 12.6 10.8 13.6 19.8 7.3 43 44 Demand deposits.................................................... 2.1 10.6 12.1 4.8 7.1 9.3 12.3 8.6 4.5 7.4 12.4 2.3 44 45 Currency................................................................... 2.0 2.1 2.4 2.8 3.5 3.4 4.4 3.9 6.3 6.2 7.3 5.1 45 46 Total of credit market instr., deposits, and currency. 42.0 56.3 68.7 49.9 64.1 90.5 115.7 128.1 114.5 144.9 133.3 156.5 46 47 Private support rate (in per cent)............................ 17.9 14.1 12.7 17.8 30.4 30.7 11.5 18.4 27.9 20.1 23.6 17.3 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 73.9 80.0 69.2 48 49 Total foreign funds..................................................... 2.1 4.3 2.9 9.1 1.8 23.2 13.6 7.2 25.1 4.4 4.5 4.2 49 Corporate equities not included above 1 Total net issues...................................... 4.8 5.5 6.4 10.0 10.4 14.8 12.9 8.0 5.6 11.7 12.5 10.9 2 Mutual fund shares......................... 3.7 3.0 5.8 4.8 2.6 1.1 -.7 -1.6 1.0 1.6 2.7 .5 3 Other equities.................................... 1.1 2.5 .6 5.2 7.7 13.6 13.6 9.6 4.6 10.1 9.8 10.4 4 Acquisitions by financial institutions 6.0 9.1 10.8 12.2 11.4 19.3 16.0 13.4 6.1 8.4 10.4 6.5 5 Other net purchases -1.2 -3.6 -4.4 -2.2 -1.0 -4.5 -3.1 -5.4 -.5 3.3 2.2 4.4 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 plus 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 Lines 1 and 3. Includes issues by financial institutions. branches, and liabilities of foreign banking agencies to foreign af­ filiates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 U.S. INTERNATIONAL TRANSACTIONS □ AUGUST 1976 1. U.S. INTERNATIONAL TRANSACTIONS—SUMMARY (In millions of dollars. Quarterly figures are seasonally adjusted except as noted.1 1975 1976 Line Credits (+), debits (—) 1973 1974 1975 I II III IV I 1 Merchandise exports................................................................................. 71,410 98,310 107,133 27,020 25,848 26,610 27,655 26,939 2 Merchandise imports................................................................................ 70,499 103,679 98,150 25,585 22,598 24,511 25,456 28,447 3 Merchandise trade balance 2............................................................... 911 -5,369 8,983 1,435 3,250 2,099 2,199 -1,508 4 Military transactions, net......................................................................... -2,287 -2,083 -883 -402 -378 -115 12 -4 5 Investment income, net............................................................................ 5,178 10,227 6,007 1,124 1,531 1,682 1,670 2,129 6 Other service transactions, net............................................................... 102 812 2,163 438 648 619 455 441 7 Balance on goods and services 3............................................................. 3,905 3,586 16,269 2,595 5,051 4,285 4,336 1,058 8 Unilateral transfers.................................................................................... -3,883 -7,185 -4,620 -1,179 -1,146 -1,044 -1,251 -1,138 9 Remittance, pensions, and other transfers...................................... -1,945 -1,710 -1,727 -431 -434 -429 -433 -480 10 U.S. Government grants (excluding military)................................. -1,938 -5,475 -2,893 -748 -712 -615 -818 -658 11 Balance on current account....................................................................... 22 -3,598 11,650 1,416 3,905 3,241 3,085 -80 17 Not seasonally adjusted......................................................................... 2,934 3,903 529 4,284 1,467 13 U.S. Govt, capital transactions, other than official reserve assets, net (outflow,—).................................................................................. -1,492 1,089 -1,731 -455 -422 -401 -453 795 14 Change in U.S. official reserve assets (increase,—)............................ 209 -1,434 -607 -325 -29 -342 89 -773 15 Gold......................................................................................................... 16 SDR’s....................................................................................................... 9 -172 -66 -4 -16 -25 -21 -45 17 Reserve position in IMF..................................................................... -33 -1,265 -466 -307 -7 -95 -57 -237 18 Foreign currencies................................................................................. 233 3 -75 -14 -6 -222 167 -491 19 Change in U.S. private assets abroad (increase,—)........................... -13,998 -32,323 -27,061 -6,777 -7,074 -3,109 -10,101 -8,065 20 Bank-reported claims........................................................................... -5,980 -19,494 -13,238 -3,702 -3,820 -429 -5,287 -3,714 21 Long-term........................................................................................... -933 -1,183 -2,351 -441 -381 -586 -943 -245 22 Short-term........................................................................................... -5,047 -18,311 -10,887 -3,261 -3,439 157 -4,344 -3,469 23 Nonbank-reported claims.................................................................... -2,378 -3,221 -1,309 363 59 -972 -759 -264 24 Long-term........................................................................................... -396 -474 -384 22 55 -139 -322 -84 25 Short-term........................................................................................... -1,982 -2,747 -925 341 4 -833 -437 -180 26 U.S. purchase of foreign securities, net............................................ -671 -1,854 -6,206 -1,928 -979 -938 -2,361 -2,507 27 U.S. direct investments abroad, net.................................................. -4,968 -7,753 -6,307 -1,510 -2,334 -770 -1,694 -1,580 28 Change in foreign official assets in the United States (increase,+).. 5,145 10,257 4,603 2,958 1,913 -2,356 2,088 1,856 29 U.S. Treasury securities....................................................................... 114 3,282 4,312 5,298 818 -2,880 1,076 1,713 30 Other U.S. Govt, obligations............................................................. 582 902 891 494 65 25 307 65 31 Other U.S. liabilities reported by U.S. banks................................. 4,126 5,818 -2,474 -3,203 591 17 121 -571 32 Other foreign official assets................................................................. 323 254 1,874 369 439 482 584 649 33 Change in foreign private assets in the United States (increase,+).. 12,220 21,452 8,544 -565 1,576 4,384 3,148 1,693 34 U.S. bank-reported liabilities............................................................. 4,702 16,017 653 -2,459 776 1,634 702 881 35 Long-term........................................................................................... 227 9 -355 -45 -287 -114 91 166 36 Short-term.......................................................................................... 4,475 16,008 1,008 -2,414 1,063 1,748 611 715 37 U.S. nonbank-reported liabilities...................................................... 1,035 1,615 78 322 58 -141 -161 24 38 Long-term........................................................................................... 298 -212 313 357 77 -99 -22 -170 39 Short-term.......................................................................................... 737 1,827 -235 -35 -19 -42 -139 194 40 Foreign private purchases of U.S. Treasury securities, net......... -214 697 2,649 752 -423 2,158 162 451 41 Foreign purchases of other U.S. securities, net.............................. 4,041 378 2,727 344 385 781 1,217 1,026 42 Foreign direct investments in the United States, net..................... 2,656 2,745 2,437 476 780 -48 1,229 -689 43 Allocations of SDR’s............................................................................... 44 Discrepancy................................................................................................ -2,107 4,557 4,602 3,748 131 -1,417 2,143 4,574 45 Owing to seasonal adjustments.......................................................... 1,330 — 37 -2,565 1,275 1,357 46 Statistical discrepancy in recorded data before seasonal adjustment...................................................................................... -2,107 4,557 4,602 2,418 168 1,148 868 3,217 Memoranda: Changes in official assets: 47 U.S. official reserve assets (increase,—)....................................... 209 -1,434 -607 -325 -29 -342 89 -773 48 Foreign official assets in the U.S. (increase,+).......................... 5,145 10,257 4,603 2,958 1,913 -2,356 2,088 1,856 49 Transfers under military grant programs (excluded from lines 1, 4, and 10 above)....................................................................... 2,809 1,817 2,232 797 1,202 56 177 50 1 Seasonal factors are no longer calculated for capital transactions— excludes special military sales from exports and U.S. Govt, interest pay­ lines 14 through 49. ments from imports. 2 Adjusted to a balance of payments basis; among other adjustments, excludes military transactions and includes imports into the Virgin Note.—Data are from U.S. Dept, of Commerce, Bureau of Economic Islands. Analysis, Survey of Current Business. A detailed description of items in 3 Differs from the definition of “net exports of goods and services” in this revised format of U.S. International Transactions will appear in a the national income and product (GNP) account. The GNP definition future issue of the Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ FOREIGN TRADE; U.S. RESERVE ASSETS A59 2. MERCHANDISE EXPORTS AND IMPORTS (Seasonally adjusted; in millions of dollars) Imports 2 Trade balance 1973 1974 1975 1976 1973 19743 1975 1976 1973 19743 1975 1976 Month: Jan— 4,955 7,150 9,374 9,103 5,244 6,498 9,633 9,176 -289 +652 -259 -73 Feb... 5,070 7,549 8,756 8,800 5,483 7,318 7,927 8,941 -413 +231 +829 -141 Mar... 5,311 7,625 8,681 8,956 5,414 7,742 7,467 9,607 -103 -117 + 1,215 -651 Apr... 5,494 8,108 8,649 9,394 5,360 8,025 7,959 9,596 + 133 +83 +690 -202 May.. 5,561 7,652 8,222 9,578 5,703 8,265 7,263 9,182 -142 -612 +958 +396 June.. 5,728 8,317 8,716 9,716 5,775 8,577 7,103 10,094 -47 -260 + 1,613 -377 July... 5,865 8,307 8,871 5,829 8,922 7,832 +37 -615 + 1,039 Aug... 6,042 8,379 8,980 6,011 9,267 7,877 +32 -888 + 1,103 Sept... 6,420 8,399 9,104 5,644 8,696 8,196 +776 -297 +908 Oct.. . 6,585 8,673 9,226 5,996 8,773 8,169 +589 -100 + 1,056 Nov... 6,879 8,973 9,409 6,684 8,973 8,201 + 195 + 1,208 Dec... 6,949 8,862 9,250 6,291 9,257 8,522 +658 -395 +728 Quarter: I 15,336 22,325 26,811 26,859 16,140 21,558 25,026 27,723 -804 +767 + 1,785 -864 I I 16,783 24,077 25,586 28,688 16,839 24,867 22,325 28,872 -56 -790 +3,261 -184 III.... 18,327 25,085 26,955 17,483 26,885 23,904 +844 -1,800 +3,051 IV.... 20,413 26,508 27,885 18,972 27,003 24,892 + 1,441 -495 +2,993 Year4... 70,823 97,908 107,130 69,476 100,251 96,116 + 1,347 -2,343 11,014 1 Exports of domestic and foreign merchandise (f.a.s. value basis); basis. For calendar 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 be­ actions value basis; prior data are reported on a Customs import value cause of rounding. 3. U.S. RESERVE ASSETS (In millions of dollars) E y n e d a r of Total To G ta o l2 ld st T o r c e k a 1 sury v c fo e u C c r r r i o t e r e i i e n b s g n ­ l n e ­ p R o I e M s s i i n e t F i r o v n e SDR’s 3 E m n o d n t o h f Total Tot G al o 2 ld s T to re c a k sury v c fo C e u c r r r o i e t r e i i e n b s g n ­ l n e ­ p R o I e s M s i i n e ti r F o v n e SDR’s 3 1961... 18,753 16,947 16,889 116 1,690 1975— 1962... 17,220 16,057 15,978 99 1,064 July___ 16,084 11,618 11,618 2 2,135 2,329 1963... 16,843 15,596 15,513 212 1,035 16,117 11,599 11,599 28 2,169 2,321 1964... 16,672 15,471 15,388 432 769 16,291 11,599 11,599 247 2,144 2,301 16,569 11,599 11,599 413 2,192 2,365 1965... 15,450 13,806 13,733 781 863 16,592 11,599 11,599 423 2,234 2,336 1966... 14,882 13,235 13,159 1,321 326 16,226 11,599 11,599 80 2,212 2,335 1967... 14,830 12,065 11,982 2,345 420 1968... 15,710 10,892 10.367 3,528 1,290 1976— 1969... 416,964 11,859 10.367 42,781 2,324 16,622 11,599 11,599 333 2,314 2,376 Feb , , 16,661 11,599 11,599 296 2,390 2,376 1970... 14,487 11,072 10,732 629 1,935 851 16,941 11,599 11,599 571 2,420 2,351 1971... 512,167 10,206 10,132 5 276 585 1,100 17,437 11,598 11,598 936 2,578 2,325 19726. . 13,151 10,487 10,410 241 465 1,958 May. ... 17,958 11,598 11,598 938 3,113 2,309 19737 . . 14,378 11.652 11,567 552 2,166 June.... '18,477 11,598 11,598 »1,365 3,198 2,316 1974. . . 15,883 11.652 11,652 1,852 2,374 July___ 818,246 11,598 11,598 864 8 3,466 82,318 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 valua­ mark 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 July amounted to $2,435 million, reserve position in IMF, $3,583 5 Includes $28 million increase in dollar value of foreign currencies million, and total U.S. reserves assets, $18,480. revalued to reflect market exchange rates as of Dec. 31, 1971. Note.—See Table 20 for gold held under earmark at F.R. Banks for 6 Total reserve assets include an increase of $1,016 million resulting foreign and international accounts. Gold under earmark is not included from change in par value of the U.S. dollar on May 8, 1972; of which, in the gold stock of the United States. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A60 GOLD RESERVES □ AUGUST 1976 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 25,865 191 140 239 707 1,470 791 82 65 85 1971............................ 41,160 4,732 10,206 26,220 192 90 259 729 1,544 792 80 64 85 1972............................ 44,890 5,830 10,487 28,575 208 152 281 791 1,638 834 87 69 92 1973............................ 49,850 6,478 11,652 31,720 231 169 312 881 1,781 927 97 77 103 1974............................ 49,800 6,478 11,652 31,670 231 169 312 882 1,781 927 97 76 103 1975—July................. 6,478 11,618 231 169 312 882 1,781 927 97 76 103 Aug................. 6,478 11,599 231 169 312 882 1,781 927 97 76 103 Sept................. 49,750 6,478 11,599 31,675 231 169 312 882 1,781 927 97 76 103 Oct.................. 6,478 11,599 231 169 312 882 1,781 927 97 76 103 Nov................. 6,478 11,599 231 169 312 882 1,781 927 97 76 103 Dec.................. 49,740 6,478 11,599 31,665 231 169 312 882 1,781 927 97 76 103 1976—Jan.................. 6,478 11,599 231 169 312 882 1,781 927 97 76 103 Feb.................. 6,478 11,599 231 169 312 882 1,781 927 97 76 103 Mar................. 49,470 6,478 11,599 31,395 231 169 312 882 1,781 916 94 76 103 Apr................. 6,478 11,598 231 169 312 882 1,781 916 94 76 May................ 6,478 11,598 231 312 882 1,781 916 94 76 June*............. 6,448 11,598 231 312 882 1,781 916 98 76 End of France Ger­ Greece India Iran Iraq Italy Japan Kuwait Leb­ Libya Mexi­ Nether­ period 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............................ 4,262 4,966 152 293 158 173 3,483 891 148 389 103 154 2,294 1975—July................. 4,262 4,966 153 293 158 173 3,483 891 154 389 103 154 2,294 Aug................. 4,262 4,966 153 293 158 173 3,483 891 154 389 103 154 2,294 Sept................ 4,262 4,966 153 293 158 173 3,483 891 160 389 103 154 2,294 Oct.................. 4,262 4,966 153 293 158 173 3,483 891 160 389 103 154 2,294 Nov................. 4,262 4,966 153 293 158 173 3,483 891 160 389 103 154 2,294 Dec.................. 4,262 4,966 153 293 158 173 3,483 891 169 389 103 154 2,294 1976—Jan.................. 4,262 4,966 153 293 158 173 3,483 891 169 389 103 152 2,294 Feb................. 4,262 4,966 153 293 158 173 3,483 891 176 103 152 2,294 Mar................. 4,262 4,966 153 293 158 173 3,483 891 176 103 152 2,294 Apr.................. 4,262 4,966 153 293 158 173 3,483 891 183 103 2*294 May................ 4,262 4,966 153 158 173 3,483 891 214 103 2 294 June*............. 4,263 4,966 153 158 3,483 891 192 103 2^294 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 Settle­ ments2 1970............................ 54 902 119 666 498 200 2,732 82 126 1,348 162 384 -282 1971............................ 55 921 108 410 498 200 2,909 82 130 777 148 391 310 1972............................ 60 1,021 117 681 541 217 3,158 89 136 801 133 425 218 1973............................ 67 1,163 129 802 602 244 3,513 99 151 887 148 472 235 1974............................ 67 1,175 129 771 602 244 3,513 99 151 888 148 472 250 1975—July................. 67 1,175 129 742 602 244 3,513 99 151 888 135 472 264 Aug................. 67 1,175 129 744 602 244 3,513 99 151 888 135 472 264 Sept................. 67 1,175 129 762 602 244 3,513 99 151 888 135 472 254 Oct.................. 67 1,175 129 754 602 244 3,513 99 151 888 135 472 256 Nov................ 67 1,175 129 752 602 244 3,513 99 151 888 135 472 259 Dec................. 67 1,170 129 749 602 244 3,513 99 151 888 135 472 246 1976—Jan.................. 67 1,170 129 753 602 244 3,513 99 151 888 135 472 213 Feb.................. 67 1,170 129 749 602 244 3,513 99 151 888 135 472 205 Mar................. 67 1,170 129 3543 602 244 3,513 99 151 888 135 472 206 Apr................. 69 1,170 129 539 602 244 3,513 99 151 135 472 231 May.......... 69 129 538 602 244 3,513 99 151 472 245 June*............. 69 129 540 244 3,514 99 151 472 290 1 Includes reported or estimated gold holdings of international and the Bank’s gold assets net of gold deposit liabilities. This procedure regional organizations, central banks and govts, of countries listed in avoids the overstatement of total world gold reserves since most of the this table, and also of a number not shown separately here, and gold to be gold deposited with the BIS is included in the gold reserves of individual distributed by the Tripartite Commission for the Restitution of Monetary countries. Gold; excludes holdings of the U.S.S.R., other Eastern European coun­ 2 Net gold assets of BIS, i.e., gold assets minus gold deposit liabilities. tries, and People’s Republic of China. 3 Reflects South African Reserve Bank sale of gold spot and repurchase The figures included for the Bank for International Settlements are forward. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ INTL. CAPITAL TRANSACTIONS OF THE U.S. A61 5. U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS, AND LIQUID LIABILITIES TO ALL OTHER FOREIGNERS (In millions of dollars) Liabilities to foreign countries Liquid Liquid Official institutions2 Liquid liabilities to other liabili­ liabili­ foreigners ties to ties to non­ End IMF Liquid mone­ of Total arising Short­ liabili­ Short­ tary period from term Market­ Non­ Other ties term Market­ inti, gold liabili­ able market­ readily to com­ liabili­ able and re­ trans­ ties re­ U.S. able U.S. market­ mercial ties re­ U.S. gional actions 1 Total ported Treas. Treas. able banks Total ported Treas. organi­ by bonds bonds liabili­ abroad 6 by bonds zations8 banks and and ties5 banks and in notes3 notes4 in notes3,7 U.S. U.S. 196 4 29,364 800 15,786 13,220 1,125 1,283 158 7,303 3,753 3,377 376 1,722 196 5 29,568 834 15,825 13,066 1,105 1,534 120 7,419 4,059 3,587 472 1,431 19669............. / \3 3 1 1 , , 0 1 1 4 9 4 1 1 , , 0 0 1 1 1 1 1 14 4 , , 8 8 9 4 5 0 1 1 2 2 , , 5 4 3 8 9 4 8 8 6 6 0 0 5 5 8 8 3 3 9 9 1 1 3 3 1 9 0 , , 9 1 3 1 6 6 4 4 , , 2 2 7 7 1 2 3 3, , 7 7 4 4 3 4 5 5 2 2 8 8 9 9 0 0 5 6 19679............. / 1 3 3 5 5 , , 8 6 1 6 9 7 1 1. . 0 0 3 3 3 3 1 1 8 8 , , 2 1 0 9 1 4 1 1 4 4 , , 0 0 2 3 7 4 9 9 0 0 8 8 1 1 , , 4 4 5 5 2 2 1 1 , , 8 8 0 0 7 7 1 1 1 1 , , 0 2 8 0 5 9 4 4 , , 6 6 7 8 8 5 4 4 , , 1 1 2 2 0 7 5 5 5 5 8 8 6 69 7 1 7 19689............. / 1 3 3 8 8 , , 6 4 8 73 7 1 1 . .0 03 3 0 0 1 1 7 7 , , 4 3 0 4 7 0 1 1 1 1 , , 3 3 1 18 8 4 5 6 29 2 3 3 , ,2 2 1 1 9 9 2 2 , , 3 3 4 4 1 1 1 14 4 , , 4 4 7 7 2 2 4 5 , , 9 0 0 5 9 3 4 4, , 4 4 4 4 4 4 4 6 6 09 5 7 72 2 5 2 19699............. 10/45,755 1,109 1015,975 11,054 346 10 3,070 1,505 23,638 4,464 3,939 525 659 145,914 1,019 15,998 11,077 346 3,070 1,505 23,645 4,589 4,064 525 663 J47,009 566 23,786 19,333 306 3,452 695 17,137 4,676 4,029 647 *844 1970—Dec. . 146,960 566 23,775 19,333 295 3,452 695 17,169 4,604 4,039 565 846 /67,681 544 51,209 39,679 1,955 9,431 144 10,262 4,138 3,691 447 1,528 1971—Dec. n 167,808 544 50,651 39,018 1,955 9,534 144 10,949 4,141 3,694 447 1,523 1972—Dec... 82,862 61,526 40,000 5,236 15,747 543 14,666 5,043 4,618 425 1,627 1973—Dec.'. 92,490 66,861 1243,923 5,701 1215,564 1,673 17,694 5,932 5,502 430 2,003 1974—Dec. 9. f119,240 76,801 53,057 5,059 16,339 2,346 30,314 8,803 8,305 498 3,322 [119,152 76,808 53,064 5,059 16,339 2,346 30,079 8,943 8,445 498 3,322 1975—June.. 122,136 80,819 51,929 6,139 19,169 3,582 27,990 9,310 8,656 654 4,017 July... 123,054 80,068 50,393 6,180 19,616 3,879 29,035 9,337 8,627 710 4,614 Aug... 129,468 79,556 49,915 6,296 19,466 3,879 30,340 9,668 8,997 671 4,904 Sept... 123,335 78,128 48,080 6,472 19,666 3,910 30,318 9,901 9,200 701 4,988 Oct.. . 123,477 80,047 49,602 6,644 19,666 4,135 28,467 10,021 9,283 738 4,942 Nov... 126,517 79,532 49,124 6,474 19,726 4,208 32,191 10,234 9,527 707 4,560 Dec... 126,273 80,286 49,170 6,599 19,976 4,541 29,579 10,765 10,036 729 5,643 1976—Jan.... 127,910 80,863 49,147 6,841 20,051 4,824 30,993 10,510 9,775 735 5,544 Feb... 131,077 -81,485 49,659 6,941 20,051 4,834 33,197 10,822 10,077 745 5,573 Mar... 129,159 81,973 49,632 7,422 20,051 4,868 30,527 *•10,915 10,115 *•800 5,744 Apr... 136,285 83,716 50,534 7,702 20,151 5,329 35,306 11,576 10,758 818 5,687 May.. 138,370 84,884 51,577 7,738 20,151 5,418 36,485 11,327 10,557 770 5,674 June**. 134,819 84,433 50,194 8,305 20,251 5,683 32,988 11,468 10,653 815 5,930 1 Includes (a) liability on gold deposited by the IMF to mitigate the shown for the preceding date; figures on second line are comparable with impact on the U.S. gold stock of foreign purchases for gold subscriptions those shown for the following date. to the IMF under quota increases, and (b) U.S. Treasury obligations at 10 Includes $101 million increase in dollar value of foreign currency cost value and funds awaiting investment obtained from proceeds of sales liabilities resulting from revaluation of the German mark in Oct. 1969. of gold by the IMF to the United States to acquire income-earning assets. 11 Data on the second line differ from those on first line because cer­ 2 Includes Bank for International Settlements; also includes European tain accounts previously classified as official institutions are included Fund through Dec. 1972. with banks; a number of reporting banks are included in the series for 3 Derived by applying reported transactions to benchmark data. the first time; and U.S. Treasury securities payable in foreign currencies 4 Excludes notes issued to foreign official nonreserve agencies. issued to official institutions of foreign countries have been increased in 5 Includes long-term liabilities reported by banks in the United States value to reflect market exchange rates as of Dec. 31, 1971. and debt securities of U.S. Federally sponsored agencies and U.S. cor­ 12 Includes $162 million increase in dollar value of foreign currency porations. liabilities revalued to reflect market exchange rates, as follows: short­ 6 Includes short-term liabilities payable in dollars to commercial banks term liabilities, $15 million; and nonmarketable U.S. Treasury notes, abroad and short-term liabilities payable in foreign currencies to commer­ $147 million. cial banks abroad and to other foreigners. 7 Includes marketable U.S. Treasury bonds and notes held by commer­ Note.—Based on Treasury Dept, data and on data reported to the cial banks abroad. Treasury Dept, by banks and brokers in the United States. Table excludes 8 Principally the International Bank for Reconstruction and Develop­ IMF holdings of dollars, and U.S. Treasury letters of credit and nonment and the Inter-American and Asian Development Banks. negotiable, non-interest-bearing special U.S. notes held by other inter­ 9 Data on the 2 lines shown for this date differ because of changes national and regional organizations. in reporting coverage. Figures on first line are comparable with those Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 INTL. CAPITAL TRANSACTIONS OF THE U.S. □ AUGUST 1976 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 197 2 61,526 34,197 4,279 1,733 17,577 111 2,963 197 3 66,861 45,764 3,853 2,544 10,887 788 3,025 (76,801 44.328 3.662 4.419 18,604 3.161 2.627 1974—Dec. 3 \76,808 44.328 3.662 4.419 18,611 3.161 2.627 1975—June. 80,819 45,483 3,008 4,723 20,536 3,800 3,269 July.. 80,068 44,458 2,966 4,763 21,430 3,319 3,132 Aug.. 79,556 44,210 2,929 4,937 21.114 3,392 2,794 Sept.. 78,128 43,481 3,011 4,840 20,889 3,145 2,762 Oct.. 80,047 45,010 3,049 4,254 22.115 3,018 2,601 Nov.. 79,532 44,744 3,218 4,056 21,949 2,951 2,614 Dec.. 80,286 45.312 3,132 4,447 22,518 2,983 1,894 1976—Jan.. , 80,863 45,406 3,420 3,552 23,775 2,724 1,986 Feb.. 81,485 44,761 3,654 3,377 24,941 2,731 2,021 Mar.. 81,973 43,567 3,673 3,779 26,329 2,718 1,907 Apr.. 83,716 43,570 3,600 3,850 28,117 2,805 1,774 May* 84,884 43,237 3,590 3,827 29,314 3,141 1,776 June* 84,433 43.313 3,578 4,303 29,016 3,245 1,978 1 Includes Bank for International Settlements; also includes European institutions of foreign countries, as reported by banks in the United States; Fund through 1972. 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 non­ pean dependencies in Latin America. marketable notes issued to foreign official nonreserve agencies; and in­ 3 See note 9 to Table 5. vestments by foreign official reserve agencies in debt securities of U.S. Federally sponsored agencies and U.S. corporations. Note.—Data represent short- and long-term liabilities to the official 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 organizations 5 IMF Payable in dollars gold Deposits Payable invest­ U.S. End of period in ment Treasury Other Total1 Deposits U.S. Other foreign Total bills and short­ Treasury short­ cur­ certifi­ term Total bills and term rencies Demand Time2 cates liab. 6 Demand Time2 certifi­ liab. 4 cates 3 197 2 60,696 60,200 8,290 5,603 31,850 14,457 496 1,412 86 202 326 799 197 3 69,074 68,477 11,310 6,882 31,886 18,399 597 1,955 101 83 296 1,474 J94,847 94,081 14,068 10,106 35,662 34,246 766 3,171 139 111 497 2,424 1974—Dec.7 \94>760 93,994 14,064 10,010 35,662 34,258 766 3,171 139 111 497 2,424 1975—June. 92,517 91,933 12,596 10,662 38,265 30,535 584 3,943 106 183 996 2,708 July.. 92,500 91,939 12,218 10,385 38,564 30,772 560 4,444 146 134 2,518 1,646 Aug.. 94,055 93,493 12,218 10,703 38,529 32,043 562 4,804 110 148 3,156 1,389 Sept.. 92,499 91,945 13,422 10,400 36,653 31,470 554 4,901 107 127 3,008 1,659 Oct... 91,935 91,300 12,159 10,584 37,749 30,808 635 4,583 132 150 2,397 1,903 Nov.. 95,313 94,673 12,813 10,293 37,297 34,270 637 4,471 145 156 1,605 2,562 Dec.. 94,077 93,478 13,579 10,664 37,414 31,821 599 5,293 139 186 2,554 2,412 1976—Jan... 94,848 94,239 12,295 10,732 38,789 32,424 600 4,925 114 217 2,498 2,096 Feb... 97,454 96,800 13,349 10,272 39,657 33,522 654 4,520 118 162 2,435 1,805 Mar.. 95,043 94,473 13,089 10,538 37,977 32,868 570 4,769 130 192 2,495 1,952 Apr.. 102,116 101,349 14,244 10,285 39,430 37,390 767 5,519 140 193 2,739 2,442 May* 104,131 103,399 13,846 10,085 40,258 39,211 732 5,508 91 185 2,876 2,356 June* 99,170 98,479 14,135 10,004 38,257 36,084 691 5,330 258 160 2,236 2,676 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ INTL. CAPITAL TRANSACTIONS OF THE U.S. A63 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 Payable Total Deposits U.S. Other foreign Deposits U.S. Other in Treasury short­ cur­ Treasury short­ foreign bills and term rencies bills and term currencies Demand Time2 certifi­ liab. 4 Demand Time2 certifi­ liab.6 cates3 cates 3 1973............. 67,119 11,209 6,799 31,590 16,925 597 43,923 2,125 3,911 31,511 6,248 127 1974—Dec. 7 J \9 9 1 1, , 6 5 7 8 6 9 1 1 3 3 , , 9 9 2 2 5 8 9 9 , . 9 8 9 9 5 9 3 3 5 5 . . 1 16 6 5 5 3 3 1 1 , , 8 82 3 2 4 7 7 6 6 6 6 5 5 3 3 , , 0 0 5 6 7 4 2 2, , 9 95 5 1 1 4 4 , ,1 25 6 7 7 3 3 4 4 , , 6 6 5 5 6 6 1 1 1 1 , , 0 1 6 6 6 3 1 12 2 7 7 1975—June' 88,575 12,491 10,528 37,269 27,703 584 51,929 2,564 4,321 36,994 8,050 July r. 88,056 12,072 10,251 36,046 29,126 561 50,393 2,492 4,098 35,803 8,000 Aug.r 89,252 12,108 10,555 35,373 30,654 562 49,915 2,493 4,164 35,055 8,205 Sept.. 87.598 13,315 10,273 33,645 29,811 554 48,080 2,452 3,957 33,284 8,387 Oct... 87,352 12,027 10,434 35,359 28,897 635 49,602 2,448 3,948 34,983 8,223 Nov.. 90,842 12,668 10,137 35,692 31,708 637 49,124 2,242 3,594 35,247 8,041 Dec.. 88,785 13,440 10,478 34,860 29,416 591 49,170 2,644 3,438 34,175 8,913 1976—Jan... 89,915 12,181 10,514 36,291 30,328 600 49,147 2,449 3,291 35,633 7,774 Feb.., 92,933 13,232 10,110 37,222 31,728 642 49,659 2,703 2,908 36,628 7,420 Mar.., 90,274 12,960 10,346 35,482 30,921 565 49,632 2,680 2,767 34,983 9,202 Apr... 96.598 14,104 10,092 36,691 34,948 763 50,534 2,782 2,319 36,196 9,237 May», 98,619 13,755 9.900 37,382 36,855 727 51,577 2,799 2,371 36,859 9,547 June.. 93,835 13,877 9,843 36,021 33,407 686 50,194 2,632 2,417 35,531 9,615 To banks9 To other foreigners To banks Payable in dollars and other . foreigners: End of period Payable in Deposits U.S. Other Deposits U.S. Other foreign Treasury short­ Treasury short­ cur­ Total bills and term bills and term rencies Demand Time2 certifi­ liab.4 Demand Time2 certifi­ liab. 6 cates cates 1973............. 23,196 17,224 6,941 529 9,743 5,502 2,143 2,359 68 933 469 1974—Dec. 7 / \ 3 38 8 , , 5 6 2 1 5 9 2 2 9 9 , , 4 6 4 7 1 6 8 8 , , 2 2 4 48 4 1 1 , , 9 9 3 4 6 2 2 2 3 32 2 1 1 9 9 . , 0 2 2 5 9 4 8 8 , , 4 3 4 0 5 4 2 2 . . 7 7 2 2 9 9 3 3 . . 7 7 9 9 6 6 2 2 7 7 7 7 1 1 , , 6 5 4 0 3 2 6 6 3 3 9 9 1975—June *• 36,645 27,406 7,070 1,979 99 18,258 8,656 2,857 4,228 176 1,395 584 Julyr. 37,661 28,474 6,887 1,860 91 19,637 8,627 2,694 4,293 152 1,489 561 Aug.r 39,337 29,778 6,910 1,827 88 20,953 8,997 2,705 4,563 230 1,498 562 Sept.. 39,518 29,764 7,982 1,775 89 19,918 9,200 2,881 4,541 272 1,506 554 Oct.. . 37,750 27,832 6,811 1,777 100 19,143 9,282 2,769 4,708 276 1,530 635 Nov.. 41,718 31.554 7,587 1,694 135 22.139 9,527 2,839 4,850 311 1,528 637 Dec.. 39,615 28,988 7,549 2,140 335 18,964 10,036 3,248 4,901 349 1.538 591 1976—Jan... 40,767 30,393 6,832 2,162 369 21.030 9,774 2,900 5,061 289 1,523 600 Feb.., 43,275 32.555 7,418 2,086 275 22,775 10,078 3,111 5,116 320 1,532 642 Mar.., 40,642 29,961 7,246 2,318 217 20,181 10,115 3,034 5,261 282 1.538 565 Apr.. 46,064 34,543 7,883 2,367 134 24,160 10,757 3,439 5,406 361 1,551 763 May*, 47,042 35,758 7,737 2,101 151 25,769 10,557 3,219 5,427 372 1.538 727 June*> 43,641 32,302 8,119 1,889 154 22.140 10,653 3,126 5,538 336 1,653 686 1 Data exclude IMF holdings of dollars. with those shown for the preceding date; figures on the second line are 2 Excludes negotiable time certificates of deposit, which are included comparable with those shown for the following date. in “Other short-term liabilities.” 8 Foreign central banks and foreign central govts, and their agencies, 3 Includes nonmarketable certificates of indebtedness and Treasury Bank for International Settlements, and European Fund through Dec. bills issued to official institutions of foreign countries. 1972. 4 Includes liabilities of U.S. banks to their foreign branches, liabilities 9 Excludes central banks, which are included in “Official institutions.” of U.S. agencies and branches of foreign banks to their head offices and foreign branches, bankers’ acceptances, commercial paper, and negotiable Note.—“Short term” obligations are those payable on demand or having time certificates of deposit. an original maturity of 1 year or less. For data on long-term liabilities 5 Principally the International Bank for Reconstruction and Develop­ reported by banks, see Table 9. Data exclude International Monetary Fund ment and the Inter-American and Asian Development Banks. holdings of dollars; these obligations to the IMF constitute contingent 6 Principally bankers’ acceptances, commercial paper, and negotiable liabilities, since they represent essentially the amount of dollars available time certificates of deposit. for drawings from the IMF by other member countries. Data exclude also 7 Data on the 2 lines shown for this date differ because of changes in U.S. Treasury letters of credit and nonnegotiable, noninterest-bearing reporting coverage. Figures on the first line are comparable in coverage special U.S. notes held by the Inter-American Development Bank and the International Development Association. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 INTL. CAPITAL TRANSACTIONS OF THE U.S. □ AUGUST 1976 8. SHORT-TERM LIABILITIES TO FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES, BY COUNTRY (End of period. Amounts outstanding; in millions of dollars) 1974 1975 1976 Area and country Dec. i Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May*’ June*5 Europe: Austria.......................................... 607 607 688 606 635 700 714 693 581 585 577 549 Belgium-Luxembourg............... 2,506 2,506 2,865 2,918 2,938 2,917 2,697 2,460 2,395 2,332 2,213 2,336 Denmark...................................... 369 369 311 327 361 332 375 434 678 681 649 452 Finland........................................ 266 266 391 367 380 391 309 313 334 350 403 396 France.......................................... 4,287 4,287 5,950 6,608 7,172 7,733 7,499 6,480 6,210 4,856 4,529 4,776 Germany...................................... 9,420 9,429 4,797 5,047 4,841 4,407 3,873 4,518 4,245 5,880 *”5,206 4,989 Greece.......................................... 248 248 361 331 313 284 263 340 261 289 299 346 Italy.............................................. 2,617 2,617 1,426 1,398 1,071 1,112 1,052 1,044 1,338 1,504 1,418 1,503 Netherlands................................. 3,234 3,234 3,059 3,199 3,301 3,148 3,132 3,558 3,397 3,281 3,111 2,256 Norway........................................ 1,040 1,040 982 886 970 996 888 925 798 915 797 807 Portugal........................................ 310 310 207 236 190 194 243 221 209 213 189 196 Spain............................................ 382 382 459 414 402 426 445 400 386 462 392 446 Sweden.......................................... 1,138 1,138 2,195 2,252 2,241 2,286 2,266 2,312 2,287 2,352 2,437 2,435 Switzerland................................. 9,986 10,137 8,048 8,205 8,029 8,556 8,611 8,648 8,854 8,965 9,129 10,135 Turkey.......................................... 152 152 116 128 120 118 88 104 106 113 101 95 United Kingdom..................... 7,559 7,584 6,268 6,722 7,177 6,885 7,611 8,236 6,724 6,589 7,096 6,665 Yugoslavia.................................. 183 183 128 138 175 126 83 178 222 179 174 182 Other Western Europe2........... 4,073 4,073 2,443 2,428 2,370 2,970 2,313 2,116 2,144 2,002 2,250 1,990 U.S.S.R........................................ 82 82 39 42 38 40 45 43 38 34 45 40 Other Eastern Europe............... 206 206 272 153 128 200 160 201 159 161 153 267 Total.................................... 48,667 48,852 41,005 42,405 42,853 43,821 42,669 43,224 41,368 41,742 41,168 40,862 Canada............................................. 3,517 3,520 3,944 3,567 4,091 3,075 3,885 4,721 4,126 4,173 4,997 3,788 Latin America: Argentina..................................... 886 886 984 1,135 1,150 1,147 1,208 1,134 1,169 1,238 1,368 1,398 Bahamas...................................... 1,448 1,054 1,503 2,221 2,989 1,834 3,197 2,946 1,715 '4,600 *•5,162 2,816 Brazil............................................ 1,034 1,034 1,016 1,083 1,075 1,227 1,191 1,135 1,320 '1,475 *•1,176 1,358 Chile............................................. 276 276 293 270 266 317 248 248 273 310 367 368 Colombia..................................... 305 305 379 366 387 414 484 536 516 *•582 629 686 Mexico.......................................... 1,770 1,770 1,872 1,956 2,183 2,078 1,899 2,048 2,004 2,133 2,218 2,358 Panama........................................ 488 510 752 765 840 1,097 1,145 953 779 961 1,098 1,207 Peru.............................................. 272 272 245 247 249 244 219 223 235 219 230 221 Uruguay...................................... 147 165 208 168 175 172 185 204 242 216 *•215 229 Venezuela................................ 3,413 3,413 4,247 3,531 3,188 3,290 2,711 2,571 2,574 2,742 2,757 2,642 Other Latin American re­ publics ..................................... 1,316 1,316 1,469 1,399 1,368 1,500 1,431 1,455 1,640 1,714 1,671 00 *f■ Netherlands Antilles and Surinam.................................... 158 158 119 113 118 129 129 143 119 121 125 129 Other Latin America................. 526 596 1,897 1,046 2,141 1,501 1,613 2,441 1,735 2,530 *•1,881 1,453 Total.................................... 12,038 11,754 14,983 14,305 16,131 14,950 15,665 16,037 14,322 *•18,839 *•18,897 16,708 Asia: China, People’s Rep. of (China Mainland).................. 50 50 94 104 93 123 263 224 101 120 139 63 China, Republic of (Taiwan).. 818 818 1,058 1,061 1,051 1,025 1,010 1,072 1,100 1,134 1,131 1,182 Hong Kong............................. 530 530 741 684 683 623 667 682 741 709 803 743 India.............................................. 261 261 214 194 181 126 203 324 338 423 632 845 Indonesia..................................... 1,221 1,221 234 612 418 369 762 583 498 920 1,121 706 Israel............................................. 386 389 322 364 342 386 292 309 346 319 324 311 Japan............................................ 10,897 10,897 11,128 9,940 10,776 10,142 10,544 11,737 12,232 12,789 *•13,246 12,846 Korea............................................ 384 384 342 400 386 390 395 382 361 360 327 343 Philippines.................................. 747 747 604 580 593 698 601 616 605 525 578 741 Thailand...................................... 333 333 207 194 193 252 279 224 225 244 218 259 Middle East oil-exporting countries 3............................... 4,633 4,608 5,111 5,785 5,987 6,440 6,428 6,535 *•7,718 *•8,008 *•8,543 7,426 Other............................................ 813 820 970 925 885 869 970 933 r967 1,017 980 1,248 Total.................................... 21,073 21,082 21,025 20,844 21,589 21,443 22,414 23,621 25,233 *•26,567 *•28,041 26,714 Africa: Egypt............................................ 103 103 188 185 255 342 177 180 314 231 197 211 South Africa................................ 130 130 254 177 108 168 218 133 186 177 202 161 Oil-exporting countries4........... 2,814 2,814 2,649 2,447 2,372 2,238 2,134 2,208 1,919 2,256 2,423 2,567 Other............................................ 504 504 560 575 643 622 563 609 680 598 651 651 Total.................................... 3,551 3,551 3,651 3,385 3,377 3,370 3,091 3,131 3,099 3,262 3,472 3,591 Other countries: Australia...................................... 2,742 2,742 2,912 2,766 2,712 2,013 2,046 2,070 2,001 1,931 1,950 2,036 All other...................................... 89 89 78 80 87 114 143 131 125 84 93 137 Total.................................... 2,831 2,831 2,989 2,846 2,800 2,127 2,190 2,201 2,126 2,015 2,043 2,173 Total foreign countries................. 91,676 91,589 87,598 87,352 90,842 88,786 89,915 92,933 90,274 *■96,598 *•98,619 93,835 International and regional: International5............................. 2,900 2,900 4,621 4,303 4,217 5,069 4,629 4,189 4,459 5,269 5,247 5,033 Latin American regional.......... 202 202 186 190 193 187 219 261 181 141 156 176 Other regional6...................... 69 69 94 90 61 37 85 70 128 108 107 126 Total.................................... 3,171 3,171 4,901 4,583 4,471 5,293 4,933 4,520 4,768 5,519 5,512 5,335 Grand total......................... 94,847 94,760 92,499 91,935 95,313 94,078 94,848 97,453 95,043 *•102,116104,131 99,170 For notes see opposite page. 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AUGUST 1976 □ INTL. CAPITAL TRANSACTIONS OF THE U.S. A65 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 data7 1974 1975 1976 1974 1975 1976 Area and country Area and country Apr. Dec, Apr. Dec. Apr.* Apr. Dec. Apr. Dec. Apr.* Other Western Europe: Other Asia—Cont.: Cyprus........................................ 10 7 17 Cambodia............... 4 4 4 4 Iceland........................................ 11 21 20 Jordan..................... 6 22 30 39 20 Ireland, Rep. of........................ 53 29 29 Laos......................... 3 3 5 2 2 Lebanon................. 68 126 180 117 Other Latin American republics: Malaysia................. 40 63 92 77 ios* Bolivia......................................... 102 96 93 110 104 Pakistan.................. 108 91 118 74 89 Costa Rica.................................. 88 118 120 r125 69 Singapore............... 165 245 215 255 Dominican Republic................ 137 128 214 169 149 Sri Lanka (Ceylon) 13 14 13 13 9 Ecuador...................................... 90 122 157 120 Vietnam................... 98 126 70 62 * El Salvador................................ 129 129 144 171 128 Guatemala.................................. 245 219 255 260 177 Haiti............................................. 28 35 34 38 36 Honduras.................................... 71 88 92 99 69 Other Africa: Jamaica....................................... 52 69 62 41 49 Ethiopia (incl. Eritrea) 118 95 76 60 70 Nicaragua.................................... 119 127 125 133 89 Ghana........................... 22 18 13 23 Paraguay..................................... 40 46 38 43 43 Kenya............................ 20 31 32 19 37 Trinidad and Tobago............... 21 107 31 131 Liberia........................... 29 39 33 53 61 Southern Rhodesia. . . 1 2 3 1 1 Other Latin America: Sudan............................ 2 4 14 12 17 Bermuda...................................... 201 116 100 170 Tanzania....................... 12 11 21 30 British West Indies................... 354 449 627 1,304 Tunisia........................... 17 19 23 29 33 Uganda......................... 11 13 38 22 Other Asia:.................................... Zambia.......................... 66 22 18 78 Afghanistan................................. 11 18 19 41 54 Burma.......................................... 42 65 49 31 All other: New Zealand............... 33 47 36 42 29 1 Data in the 2 columns shown for this date differ because of changes 4 Comprises Algeria, Gabon, Libya, and Nigeria. in reporting coverage. Figures in the first column are comparable in 5 Data exclude holdings of dollars of the International Monetary Fund. coverage with those for the preceding date; figures in the second column 6 Asian, African, and European regional organizations, except BIS, are comparable with those shown for the following date. which is included in “Europe.” 2 Includes Bank for International Settlements. 7 Represent a partial breakdown of the amounts shown in the other 3 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, categories (except “Other Eastern Europe”). and United Arab Emirates (Trucial States). 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 To inti. End of period Total and Official Other United Total All regional Total institu­ Banks1 foreign­ Ger­ King­ Total Latin Middle Other other tions ers many dom Europe America East2 Asia3 coun­ tries 1972................................. 1,018 580 439 93 259 87 165 63 260 136 33 10 1973................................. 1,462 761 700 310 291 100 159 66 470 132 83 16 1974................................. 1,285 822 464 124 261 79 146 43 227 115 94 8 20 1975—June.................... 1,460 512 948 806 247 70 120 59 197 121 599 2 23 July..................... 1,493 432 1,060 1,041 242 77 121 61 201 121 709 5 24 Aug..................... 1,446 372 1,074 751 243 81 120 61 202 123 719 6 23 Sept..................... 1,468 395 1,073 753 241 79 118 61 201 121 721 6 23 Oct...................... 1,385 311 1,072 748 241 83 118 61 206 126 712 4 24 Nov..................... 1,391 297 1,093 749 261 83 115 61 206 147 712 4 24 Dec...................... 1,757 415 1,340 951 289 100 164 61 256 140 913 9 24 1976—Jan....................... 1,875 306 1,567 1,042 402 123 264 65 373 142 1,005 8 41 Feb...................... 1,859 286 1,571 1,065 398 107 262 64 369 141 1,024 12 26 Mar..................... 2,062 157 1,904 1,091 442 371 256 78 393 147 1,310 16 40 Apr...................... 2,087 197 1,888 1,372 385 131 259 87 407 108 1,335 14 25 May.................... 2,134 135 1,997 1,429 431 137 306 87 453 104 1,399 16 26 June*.................. 2,255 189 2,065 1,490 431 143 308 70 441 110 1,458 17 41 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. 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A66 INTL. CAPITAL TRANSACTIONS OF THE U.S. □ AUGUST 1976 10. ESTIMATED FOREIGN HOLDINGS OF MARKETABLE U.S. TREASURY BONDS AND NOTES (End of period; in millions of dollars) 1974 1975 1976 Area and country Dec. June' July' Aug.r Sept.' Oct.' Nov.' Dec.' Jan.' Feb.' Mar.' Apr. May* June* Europe: Belgium-Luxembourg......... 10 14 14 14 14 14 13 13 13 13 13 14 13 13 9 209 209 210 217 216 216 215 212 238 247 228 225 227 Sweden.................................. 251 252 252 278 275 275 275 276 276 275 276 276 281 291 Switzerland........................... 30 37 37 41 44 54 58 55 68 72 75 89 99 101 United Kingdom................. 493 522 536 520 501 441 414 363 374 370 386 389 349 380 Other Western Europe.... r88 97 98 102 114 152 152 117 199 204 371 455 462 540 Eastern Europe................... 5 5 5 5 5 5 4 4 4 4 4 4 4 4 Total............................. 885 1,135 1,151 1,169 1,170 1,157 1,134 1,044 1,146 1,176 1,372 1,455 1,433 1,556 Canada...................................... 713 412 408 406 404 399 400 393 393 416 416 422 337 337 Latin America: Latin American republics.. 12 13 13 13 13 13 33 33 33 31 31 31 32 32 Netherlands Antilles 1. ... 83 134 178 149 149 158 160 161 159 131 121 120 125 141 Other Latin America......... 5 5 5 5 5 6 6 6 7 8 8 8 9 9 100 152 196 167 168 177 199 200 199 170 160 159 165 182 Asia: Japan..................................... 3,498 3,496 3,496 3,496 3,502 3,520 3,269 3,271 3,268 3,212 3,217 3,217 3,074 3,075 212 1,417 1,438 1,518 1,668 1,818 1,869 2,099 2,229 2,362 2,662 2,855 3,068 3,499 Total............................. 3,709 4,913 4,934 5,014 5,170 5,339 5,138 5,370 5,497 5,573 5,879 6,072 6,142 6,574 Africa........................................ 151 181 201 211 261 311 311 321 340 350 396 411 431 471 All other.................................... Total foreign countries.......... 5,557 6,793 6,890 6,967 7,173 7,382 7,181 7,328 7,576 7,686 8,223 8,520 8,508 9,121 International and regional: International........................ 97 29 128 66 52 324 60 322 593 1,034 957 153 149 583 Latin American regional. . 53 44 40 35 35 35 29 29 19 19 19 16 13 13 Total............................. 150 74 169 101 87 359 89 351 612 1,053 975 170 162 596 Grand total.................. 5,708 6,867 7,059 7,068 7,260 7,741 7,270 7,679 8,188 8,739 9,197 8,689 8,671 9,716 1 Includes Surinam until Jan. 1976. year, and are based on a benchmark survey of holdings as of Jan. 31,1971, Note.—Data represent estimated official and private holdings of mar- and monthly transactions reports (see Table 14). ketable U.S. Treasury securities with an original maturity of more than 1 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 Loan'> to— Accept­ Foreign End of period Total Collec­ ances govt, se­ tions made Deposits curities, Total Official out­ for acct. Other Total with for­ coml. Other Total institu­ Banks1 Others2 stand­ of for­ eigners and fi­ tions ing eigners nance paper 1972................................ 15,676 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................................ 39,030 37,835 11,301 381 7,342 3,579 5,637 11,237 9,659 1,195 668 289 238 1975—June.................... 45,710 44,497 11,347 494 6,796 4,057 5,345 10,641 17,165 1,212 591 335 286 July..................... 45,542 44,368 11,705 572 6,837 4,296 5,383 10,204 17,076 1,175 608 296 271 Aug..................... 45,441 44,293 13,084 626 7,96a 4,499 5,314 9,977 15,917 1,148 610 240 298 Sept..................... 45,564 44,433 12,706 572 7,520 4,614 5,314 10,071 16,342 1,130 576 236 319 Oct...................... 47,697 46,390 12,632 632 7,483 4,517 5,465 10,134 18,160 1,306 734 231 341 Nov..................... 48,127 46,846 13,075 670 7,929 4,476 5,363 10,610 17,799 1,281 625 340 316 Dec..................... 49,876 48,588 13,352 586 7,736 5,030 5,467 11,132 18,637 1,288 612 301 376 1976—Jan...................... 51,275 50,043 13,609 669 8,132 4,808 5,311 11,047 20,077 1,232 682 263 286 Feb...................... 53,749 52,348 14,233 754 8,699 4,771 5,191 10,994 21,941 1,401 728 241 431 Mar..................... 53,390 52,069 13,551 763 7,971 4,817 5,367 11,134 22,018 1,321 794 145 382 Apr..................... 55,668 54,219 14,549 769 8,824 4,956 5,325 11,297 23,048 1,449 920 156 373 May*.................. 56,383 54,965 15,854 1,051 9,525 5,277 5,379 11,310 22,423 1,419 878 141 399 June*................. 57,468 55,912 15,462 841 9,367 5,254 5,516 11,525 23,408 1,556 914 157 484 1 Excludes central banks which are included with “Official institutions.” 2 Includes international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ INTL. CAPITAL TRANSACTIONS OF THE U.S. A67 12. SHORT-TERM CLAIMS ON FOREIGNERS REPORTED BY BANKS IN THE UNITED STATES, BY COUNTRY (End of period. Amounts outstanding; in millions of dollars) 1974 1975 1976 Area and country Dec. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May** June*1 Europe: 21 20 19 32 15 20 23 22 39 25 35 384 536 555 463 352 401 417 430 398 427 537 46 46 50 54 49 55 55 55 59 57 61 122 130 127 133 128 132 120 128 105 109 124 673 906 1,329 1,195 1,403 1,336 1,451 1,240 1,233 1,109 1,145 589 443 496 659 427 486 426 474 452 448 389 Greece............................................................ 64 54 56 91 49 55 52 53 63 62 53 Italy................................................................ 345 363 438 418 370 369 402 360 406 492 554 348 313 264 285 300 316 267 269 290 267 318 119 102 102 92 71 66 63 66 71 76 71 Portugal......................................................... 20 18 15 19 16 20 20 21 18 32 40 196 245 256 261 249 274 262 231 241 321 285 180 182 152 182 167 124 111 121 105 116 106 335 214 274 314 232 245 278 340 400 355 400 15 56 54 121 86 59 82 73 68 90 99 United Kingdom........................................ 2,570 3,724 3,792 3,858 4,586 4,506 4,707 4,429 5,295 4,987 4,866 22 37 34 55 38 37 49 64 50 47 45 22 23 22 25 27 26 29 29 27 41 57 U.S.S.R........................................................... 46 106 144 165 103 101 84 85 63 70 70 Other Eastern Europe................................ 131 110 96 103 114 124 159 109 107 102 110 6,245 7,630 8,275 8,526 8,781 8,752 9,056 8,599 9,491 9,232 9,365 2,776 2,626 2,728 2,742 2,812 3,015 2,978 2,917 3,253 3,364 3,176 Latin America: 720 1,219 1,343 1,229 1,203 1,246 1,338 1,290 1,374 1,342 1,145 3,398 6,432 7,250 6,856 7,513 7,981 9,830 10,303 10,267 9,829 11,448 1,415 1,491 1,536 1,785 2,200 2,132 2,173 2,318 2,351 2,414 2,689 Chile............................................................... 290 405 351 381 360 312 343 324 349 352 ' 340 713 684 662 649 689 651 586 545 539 518 533 1,972 2,705 2,623 2,565 2,800 2,776 3,079 3,034 3,236 3,444 3,458 503 721 903 886 1,032 1,262 1,167 1,108 *"787 991 824 518 624 599 565 588 624 634 597 638 621 623 63 54 52 56 51 68 62 46 39 33 33 704 1,109 1,051 980 1,086 1,001 925 1,040 1,077 1,280 1,152 Other Latin American republics.............. 866 1,014 1,041 969 980 1,045 1,061 986 *•1,039 1,137 1,062 Netherlands Antilles and Surinam......... 62 57 59 46 49 53 43 33 32 32 33 1,142 1,684 2,202 2,555 1,816 3,059 3,253 2,708 3,718 3,996 3,259 12,366 18,199 19,673 19,522 20,417 22,224 24,495 24,331 *•25,458 26,005 26,633 Asia: China, People’s Rep. of (China Mainland) 4 5 11 11 22 10 17 22 18 9 10 China, Republic of (Taiwan).................... 500 606 601 681 735 725 729 775 793 860 861 223 231 257 258 258 234 225 229 200 228 273 14 21 17 16 21 19 26 25 26 34 38 157 91 86 92 105 129 131 162 162 171 164 255 398 389 387 491 419 365 307 314 285 315 12,514 10,400 10,253 10,429 10,760 10,109 9,870 10,202 *-10,118 10,004 10,349 955 1,515 1,555 1,505 1,556 1,605 1,715 1,600 1,713 1,675 1,713 372 340 338 347 377 434 507 510 520 559 525 458 474 501 499 495 535 516 537 533 491 488 Middle East oil-exporting countries1.. 330 624 446 506 524 525 600 646 605 742 880 441 651 702 665 683 734 705 731 632 785 719 Total....................................................... 16,222 15,357 15,156 15,396 16,025 15,477 15,405 15,747 *-15,635 15,841 16,334 Africa: 111 125 127 130 104 106 101 103 110 106 117 329 504 513 540 546 547 546 575 631 672 687 115 190 207 215 231 213 230 226 r211 211 181 300 343 380 409 351 349 330 270 *300 336 329 855 1,162 1,227 1,294 1,231 1,215 1,207 1,174 1,252 1,325 1,313 Other countries: 466 509 532 554 535 503 492 521 498 547 547 99 80 105 91 73 87 113 98 79 67 100 565 589 638 645 608 589 605 619 577 615 647 39,030 45,562 47,696 48,126 49,875 51,272 53,747 53,387 *•55,666 56,382 57,467 1 * 1 1 3 2 3 2 1 1 39,030 45,564 47,697 48,127 49,876 51,275 53,749 53,390 *-55,668 56,383 57,468 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 Comprises Algeria, Gabon, Libya, and Nigeria. their own account or for account of their customers in the United States; and foreign currency balances held abroad by banks and bankers and Note.—Short-term claims are principally the following items payable their customers in the United States. Excludes foreign currencies held on demand or with a contractual maturity of not more than 1 year: loans by U.S. monetary authorities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 INTL. CAPITAL TRANSACTIONS OF THE U.S. □ AUGUST 1976 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 Loans to— in Total Total Middle Other All Other foreign Europe Canada Latin Japan East3 Asia4 other long­ curren­ America coun­ Official Other term cies tries2 Total institu­ Banks1 foreign­ claims tions ers2 197 2 5,063 4,588 844 430 3,314 435 40 853 406 2,020 353 918 514 197 3 5,996 5,446 1,160 591 3,694 478 72 1,272 490 2,116 251 1,331 536 197 4 7,183 6,494 1,333 931 4,230 609 80 1,907 501 2,613 258 384 977 542 1975—June.... 7,995 7,184 1,274 1,226 4,683 719 92 2,303 461 2,880 264 241 1,150 696 July.... 8,308 7,425 1,292 1,319 4,815 792 90 2,344 471 3,037 270 241 1,223 723 Aug. . .. 8,265 7,394 1,276 1,336 4,782 787 85 2,395 438 3,003 259 237 1,204 728 Sep........ 8,539 7,637 1,348 1,364 4,926 809 93 2,426 508 3,132 265 237 1.195 775 Oct........ 8,860 7,907 1,266 1,516 5,125 840 114 2,534 595 3,168 292 222 1,214 835 Nov.. . . 9,070 8,050 1,303 1,547 5,201 903 118 2,529 569 3,281 293 249 1,218 931 Dec........ 9,485 8,435 1.380 1,692 5,362 934 116 2,675 555 3,448 296 220 1,276 1,016 1976—Ja...........n 9,412 8,349 1,290 1,636 5,423 945 118 2,677 552 3,382 289 205 1.278 1,030 Feb........ 9,511 8,352 1,268 1,632 5,452 1,012 148 2,602 576 3,471 289 210 1,270 1,093 Mar.. . . 9,800 8,641 1,316 1 ,740 5,584 1,011 149 2,702 570 3,605 292 296 1.195 1,140 Apr........ 9,980 8,783 1,337 1,842 5,603 1,081 116 2,736 558 3,785 307 196 1.279 1,118 May*... 10,252 9,004 1.381 1,933 5,689 1,133 115 2,831 607 3,973 307 196 1,263 1,075 June*... 10,126 8,842 1,345 1,944 5,554 1,162 121 2,714 575 4,053 323 182 1,246 1,033 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 bonds 3 Foreign stocks 3 securities2,3 Net purchases or sales ( —) Period Pur­ Net pur­ Pur­ Net pur­ Pur- Net pur­ Intl. Foreign chases Sales chases or chases Sales chases Sales Sales chases or Total and sales ( —) sales ( — ) sales (—) regional Total4 Official Other 197 3 305 -165 470 465 6 18,574 13,810 4,764 1,474 2,467 -993 1,729 1,554 176 197 4 -472 101 -573 -642 69 16,183 14,677 1,506 1,036 3,254 -2,218 1,907 1,722 185 197 5 1,971 201 1,770 1,540 230 20,360 15,212 5,148 2,386 8,687 -6,300 1,538 1,719 -182 1976—Jan.-June* 2,038 245 1,793 1,706 87 13,535 10,630 2,905 2,233 6,015 -3,782 1,028 1,190 162 1975—Jun e -240 -326 86 56 31 1,754 1,332 422 215 852 -637 129 143 -15 July.................... 192 95 96 41 56 2,251 1,278 973 315 1,008 -693 109 119 -10 Aug.................... 9 -67 77 117 -40 1,421 1,338 82 158 318 -160 89 256 -167 Sept................... 192 -14 206 175 31 1,257 1,124 134 194 285 -91 91 79 11 Oct..................... 481 272 209 173 37 2,023 1,362 662 195 678 -484 137 161 -24 Nov..................... -470 -270 -201 -171 -30 1,605 1,231 374 248 991 -743 107 78 29 Dec.................... 405 262 143 121 21 1,859 958 901 282 1,471 -1,190 148 97 51 1976—Ja.......................n 509 261 248 242 6 2,798 2,069 729 462 800 -339 145 139 6 Feb.................... 551 441 110 101 10 2,503 2,086 418 402 1,547 -1,145 162 218 -56 Mar................... 458 -78 536 481 55 2,524 1,972 552 360 1,282 -922 193 246 -53 Apr.................... -508 -805 297 280 18 2,260 1,689 571 341 763 -422 182 143 40 May*................. -19 -7 -11 37 -48 1,634 1,496 138 373 811 -439 198 240 -42 June*................. 1,046 433 612 567 45 1,817 1,317 499 295 811 -516 147 204 -57 1 Excludes nonmarketable U.S. Treasury bonds and notes issued to Middle East Africa official institutions of foreign countries. 2 Includes State and local govt, securities, and securities of U.S. Govt, 1975* 1,773 170 agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments 1976—Jan.-June* 1,447 150 abroad. 3 Includes transactions of international and regional organizations. 1975—June 106 4 Includes transactions (in millions of dollars) of oil-exporting countries July 1 20 in Middle East and Africa as shown in the tabulation in the opposite Aug. 80 10 column: Sept. 150 50 Oct. 150 50 Nov. 51 Dec. 176 10 1976—Jan. 115 20 Feb. 116 10 Mar. 282 45 Apr. 270 15 May '203 20 June* 461 40 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ INTL. CAPITAL TRANSACTIONS OF THE U.S. A69 15. NET PURCHASES OR SALES BY FOREIGNERS OF U.S. CORPORATE STOCKS, BY COUNTRY (In millions of dollars) Pur­ Net pur­ Ger­ Nether­ Switzer­ United Total Total Middle Other Period chases Sales chases or France many lands land King­ Europe Canada America East1 Asia2Other^ 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 -377 281 -6 -33 288 10 1975....................... 15,066 10,600 4,465 262 250 359 897 569 2,464 356 -7 1,470 140 39 1976—Jan.-June?5 10,614 8,367 2,246 132 113 -30 161 286 694 154 157 1,114 99 28 1975—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 75 396 20 13 153 2 6 Aug............ 1,153 712 441 52 52 47 83 38 302 21 -6 82 26 16 Sept........... 882 642 240 10 7 22 64 7 123 20 -15 72 32 8 Oct............. 1,407 1,042 365 16 -7 17 36 48 142 59 7 130 21 6 Nov........... 1,114 809 304 22 40 -5 42 44 132 36 -1 122 12 4 Dec............ 1,355 686 669 28 40 64 123 32 297 102 -9 268 13 -3 1976—Jan............. 2,060 1,544 517 1 136 -48 -2 88 208 40 76 198 -6 1 Feb............ 2,095 1,724 371 14 12 -14 63 41 133 48 11 175 5 5 Mar........... 2,137 1,555 582 79 26 -6 147 69 327 16 28 153 42 16 Apr............ 1,690 1,279 410 10 10 31 -21 49 84 23 25 254 22 -1 May*........ 1,207 1,092 115 3 -44 4 23 19 -9 30 7 67 16 4 June?........ 1,425 1,173 252 24 -28 2 -49 19 -49 -2 11 266 20 3 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 Nether­Switzer­ United Total Total Middle Other Total Other Intl. and Period Total many lands land Kingdom Europe Canada Latin East1 Asia2 Africa countries regional America 197 3 1,948 201 -19 307 275 1,204 49 44 588 52 197 4 966 96 183 96 373 719 45 43 632 -483 197 5 681 82 -16 116 80 116 127 30 1,437 -42 -993 1976—Jan.-June® 658 15 -37 46 10 735 -102 16 1975—Jun e 164 9 32 58 4 65 -1 38 July........... 384 27 16 6 80 183 33 1 179 4 -17 Aug............ -358 13 -3 -18 -69 -73 6 1 -1 1 -292 Sept........... -107 -13 6 25 121 -19 -5 5 82 -7 -162 Oct............. 296 1 -50 2 89 51 38 11 209 -4 3 -11 Nov........... 69 39 -17 -41 -25 -2 6 75 4 1 11 Dec............ 232 2 3 56 74 6 6 140 -12 1 16 1976—Ja...............n 212 -1 4 -1 -2 -161 7 29 3 219 -21 -2 -10 -13 Feb............ 47 2 -1 2 20 -2 23 4 6 30 -34 1 * 18 Mar........... -31 3 -56 -3 5 -11 -70 9 1 35 -20 4 -10 20 Apr............ 160 3 9 -5 4 -26 -25 7 3 179 -14 7 4 May®........ 22 3 -2 23 19 -2 -3 -3 37 6 -13 June®........ 247 6 -1 18 30 1 235 -19 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 di­ rect 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 rope ica rica tries period (due to (due from gional tries foreigners) foreigners) 1973................. -818 139 -957 -141 -569 -120 -168 3 37 1973—Sept. 290 255 1974................. -2,033 -60 -1,973 -546 -1,508 -93 144 7 22 Dec. 333 231 1975................. -6,515 -2,225 -4,290 -47 -3,178 -306 -619 15 -154 1974—Mar. 383 225 1976— June, 354 241 Jan.-June®.. -3,944 -282 -3,662 -314 -2,837 -100 -207 34 -238 Sept. 298 178 Dec. 293 194 1975—June... -655 * -655 -22 -478 * -30 2 -127 July.... -699 -475 -224 -26 -109 -25 -69 * 4 1975—Mar. 349 209 Aug---- -362 -21 -341 24 -204 -164 1 1 2 June. 380 233 Sept.... -80 18 -98 -19 -129 25 24 -1 1 Sept. 343 258 Oct....... -508 5 -513 48 -460 -48 -56 -3 6 Dec., 365 319 Nov___ -714 -62 -652 -27 -584 6 3 -2 -48 Dec.. . . -1,139 -839 -299 80 -310 9 -78 -1 1 1976—Mar. 411 333 1976—Jan....... -333 94 -426 -109 -304 -9 -4 -3 2 Feb... . -1,201 -139 -1,063 33 -973 5 -110 -4 -14 Note.—Data represent the money credit balances and Mar___ 975 9 -984 -168 -727 -72 -14 -5 2 money debit balances appearing on the books of reporting Apr.. .. -382 -94 -288 * -286 6 -15 4 2 brokers and dealers in the United States, in accounts of May®.. -481 -158 -323 -19 -222 -39 -77 32 3 foreigners with them, and in their accounts carried by June®.. -572 6 -578 -52 -326 10 13 11 -234 foreigners. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A70 INTL. CAPITAL TRANSACTIONS OF THE U.S. □ AUGUST 1976 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 Other Total Parent Other Total branches Other cial bank bank of parent banks insti­ for­ bank tutions eigners IN ALL FOREIGN COUNTRIES Total, all currencies............................ 1973—De c 121,866 5,091 1,886 3,205 111,974 19,177 56,368 2,693 33,736 4,802 1974—De c 151,905 6,900 4,464 2,435 138,712 27,559 60,283 4,077 46,793 6,294 1975—Ma y 158,407 7.737 4,898 2,838 144,457 28,229 60,345 4,495 51,388 6,213 June........... 164.117 5,542 2,344 3,198 152,123 31,628 63,757 4,843 51,896 6,451 July............ 162,511 5,926 2,795 3,131 149,946 31.055 62,468 4,798 51,626 6,639 Aug............ 167,672 9,151 6,098 3,054 151,897 32,062 62,486 4,901 52,449 6,623 Sept............ 167,886 6,575 3,268 3,307 154,905 32,216 65,065 4,863 52,761 6,407 Oct............. 171,465 7,924 4,896 3.027 156,989 33,571 64,273 5,237 53,909 6,553 Nov............ 173,736 8,705 5,777 2,928 158,179 34,464 64,408 5,516 53,790 6,852 Dec............ 176,493 6,726 3,665 3,061 163,414 34,592 68,403 5,879 54,540 6,352 1976—Ja n 178,925 7,995 5,007 2,988 164,682 36,723 66,592 6,121 55,246 6,248 Feb............. 180,779 8,937 5,903 3,033 165,411 34,770 69,122 6,332 55,187 6,431 Mar............ 185,957 6.737 r3,520 '3,217 172,680 38,435 72,244 6,661 55,341 6,540 Apr............ f ,574 9,046 6,041 3,005 172,982 39,166 70,508 7,213 56,095 6,546 May**......... 193,719 10,014 6,919 3,095 176,952 39,598 73,453 7,820 56,081 6,753 Payable in U.S. dollars. 1973—De c 79,445 4,599 1,848 2,751 73,018 12,799 39,527 1,777 18,915 1,828 1974—De c 105,969 6,603 4,428 2,175 96,209 19,688 45,067 3,289 28,164 3,157 1975—Ma y 112,670 7,327 4,834 2,493 102,389 21,885 45,405 3,686 31,413 2,954 June........... 118,436 5,115 2,282 2,833 110,294 25,183 49,149 3.950 32,012 3,026 July............ 118,558 5,519 2,744 2,776 109,544 25,001 48,590 3,930 32,023 3,495 Aug............ 122,781 8,827 6,044 2,783 110,654 25,758 48,071 4,148 32,676 3,299 Sept............ 124,373 6,238 3,211 3.027 115,178 26.055 51,493 4,042 33,589 2,957 Oct............. 127,355 7,506 4,822 2,684 116,673 27,367 50,062 4.363 34,881 3,176 Nov............ 130,233 8,350 5,725 2,625 118,603 28,329 50,992 4,646 34,637 3,280 Dec............ 132,901 6,392 3,628 2,764 123,512 28,490 54,764 4.951 35,307 2,997 1976—Ja n 134,366 7,659 4,967 2,692 123,618 29,827 52,671 5,229 35,891 3,090 Feb............ 135,918 8,622 5,859 2,763 124,070 28,399 54,497 5.364 35,809 3,226 Mar............ 137,811 6,458 r3,473 '2,986 128,246 30,156 56,039 5,719 36,331 3,107 Apr............ 140,591 8,751 5,972 2,778 128,769 31,172 54,496 6,158 36,943 3,071 May*3......... 146.117 9,699 6,844 2,855 133,175 31,832 57,540 6,656 37,148 3,243 IN UNITED KINGDOM Total, all currencies........... 1973—De c 61,732 1,789 738 1,051 57,761 8,773 34.442 735 13,811 2,183 1974—De c 69,804 3,248 2,472 776 64,111 12,724 32,701 788 17,898 2,445 1975—Ma y 68,707 2,535 1,689 845 64,269 12,491 32.443 920 18,415 1,904 June........... 70,751 1,834 641 1,192 66,868 13,765 34,634 948 17,522 2,049 July............ 70,382 1,904 807 1.097 66,277 14,414 33,431 923 17,509 2,202 Aug............ 72.455 3,795 2.698 1.097 66,428 15,213 32,998 948 17,268 2,232 Sept............ 72,120 2,042 1,076 967 67,923 15,249 34,759 825 17,091 2,155 Oct............. 72,742 2,681 1.699 982 67,631 16.555 32,806 830 17,440 2,430 Nov............ 73,924 3.112 2,137 975 68.494 17,549 33,189 852 16,904 2,319 Dec............ 74,883 2,375 1,449 926 70,354 17,557 35,102 881 16,814 2,153 1976—Ja n 73,437 2,253 1,469 784 68,983 18,026 33,094 1,034 16,828 2,202 Feb............. 72,963 2,947 2,270 677 67,843 16,050 34,887 964 15,941 2,174 Mar............ 74,668 2.112 1,237 875 70,300 17,363 36,723 927 15,287 2,256 Apr............ 74,055 2,275 1,447 827 69,555 18,394 34,879 934 15,348 2,226 May*1......... 75,926 2,443 1,534 909 71,189 18,619 36,270 851 15,449 2,294 Payable in U.S. dollars. 1973—De c 40,323 1,642 730 912 37,816 6,509 23,389 510 7,409 865 1974—De c 49,211 3,146 2,468 678 44,693 10,265 23,716 610 10,102 1,372 1975—Ma y 48,506 2,404 1,671 733 45,180 10,656 23,320 698 10,506 922 June........... 51,365 1,669 623 1,045 48,713 12,054 25,761 721 10,178 983 July............ 51,665 1,742 793 949 48,787 12,664 25,143 713 10,267 1,136 Aug............ 53.456 3,661 2,681 980 48,763 13,315 24,540 740 10,168 1,032 Sept............ 54,256 1,910 1,054 856 51,369 13,488 27,008 596 10,277 977 Oct............. 54,192 2,552 1,687 865 50.494 14,654 24,691 592 10,557 1,146 Nov............ 56,221 2,988 2,123 865 52,145 15.555 25,600 638 10,353 1,087 Dec............ 57,361 2,257 1,445 812 54,137 15,645 27,669 648 10,175 967 1976—Ja n 55,067 2,141 1,459 683 52,046 15,574 25,311 837 10,325 880 Feb............ 55,041 2,856 2,261 595 51,266 14,278 26,741 715 9,532 918 Mar............ 55,115 2,010 1,234 775 52,147 14,450 27,526 691 9,482 958 Apr............ 54,516 2,155 1,434 721 51,469 15,424 25,280 633 9,593 891 May2*......... 56,667 2,322 1,519 803 53,466 15,860 27,218 635 9,754 879 IN BAHAMAS AND CAYMANS i Total, all currencies............................. 1973—De c 23,771 2,210 317 1,893 21,041 1 ,S 9,895 1,151 8,068 520 1974—De c 31,733 2,464 1,081 1,383 28,453 3,478 11,354 2,022 11,599 815 1975—Ma y 38,198 4,126 2,468 1,658 33,214 4,270 13.181 2,531 13,232 858 June........... 39,646 2,634 987 1,647 36,181 5,831 13,747 2,772 13,831 831 July............ 39,614 2,787 1,134 1,653 35,676 5,015 14,065 2,747 13,849 1,150 Aug............ 41,624 4,117 2,580 1,536 36,555 5,222 14,117 2,891 14,324 953 Sept........... 41,601 3,189 1,289 1,900 37,479 5,220 14,604 3,020 14,635 933 Oct............. 44,166 3,989 2,295 1,694 39,225 5,604 15,414 3,308 14,899 952 Nov............ 44,471 4,544 2,929 1,615 38,973 5,321 15,134 3,434 15,084 954 Dec............ 45,203 3,229 1,477 1,752 41,040 5,411 16,298 3,576 15,756 933 1976—Ja n 48,694 4,488 2,614 1,874 43,104 6,296 17,195 3,677 15,935 1,102 Feb............. 50,276 4,765 2,750 2,014 44,396 6,257 17,556 3,908 16,675 1,115 Mar............ 51,075 3,482 rl ,485 r\ ,996 46,636 6,745 18,205 4,251 17,434 957 Apr............ 54,398 5,695 3,835 1,860 47,536 6,437 18,503 4,680 17,917 1,166 May**......... 257,247 6,294 4,424 1,870 49,631 6,435 20.181 5,101 17,915 1,322 For notes see p. A-74. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AUGUST 1976 □ INTL. CAPITAL TRANSACTIONS OF THE U.S. A71 19b. LIABILITIES OF FOREIGN BRANCHES OF U.S. BANKS (In millions of dollars) To U.S. To foreigners Total Other Offi­ Non­ Other Month-end Location and currency form Total Parent Other Total branches Other cial bank bank of parent banks insti­ for­ bank tutions eigners IN ALL FOREIGN COUNTRIES 5,610 1,642 3,968 111,615 18,213 65,389 10,330 17,683 4,641 ..........1973-—Dec. .. .Total, all currencies 151,905 11,982 5,809 6,173 132,990 26,941 65,675 20,185 20,189 6,933 .........1974—Dec. 158,407 16,920 10,426 6,494 135,176 27,855 64,714 22,263 20,344 6,311 1975-—May 164,117 18,697 12,283 6,414 138,813 31,693 64,996 21,169 20,955 6,607 162,511 17,771 11,609 6,162 138,477 31,673 65,968 20,387 20,449 6,263 July 167,673 17,335 10,173 7,162 143,944 31,926 70,216 21,114 20,688 6,395 167,886 18,502 11,026 7,476 143,182 31,567 70,853 19,780 20,981 6,202 Sept. 171,465 19,154 11,282 7,872 146,085 33,216 70,579 20,642 21,648 6,227 Oct. 173,736 19,858 11,201 8,657 147,067 33,892 70,623 21,200 21,352 6,811 Nov. 176,493 20,204 12,149 8,056 149,854 34,127 72,182 22,773 20,771 6,435 178,925 22,570 12,691 9,879 150,439 35,568 72,347 21,710 20,814 5,916 1976-—Jan. 180,779 24,474 14,091 10,383 150,300 34,916 70,863 23,189 21,331 6,005 Feb. 185,957 24,612 15,288 9,325 155,481 37,502 72,657 22,493 22,830 5,863 26,705 14,543 12,162 156,084 38,508 72,591 21,857 23,128 5,785 28,213 15,914 12,299 159,474 38,642 75,813 22,367 22,652 6,032 May* 5,027 1,477 3,550 73,189 12,554 43,641 7,491 9,502 2,158 .......... 1973-—Dec. . Payable in U.S. dollars 11,437 5,641 5,795 92,503 19,330 43,656 17,444 12,072 3,951 115,281 16,316 10,249 6,067 95,526 21,585 43,865 18,928 11,148 3,439 1975-—May 120,648 18,077 12,087 5,990 98,969 25,072 44,208 17,968 11,720 3,602 120,763 17,157 11,402 5,755 100,348 25,422 45,903 17,393 11,630 3,258 July 16,689 9,992 6,698 105,216 25,646 49,427 18,080 12,064 3,423 17,871 10,823 7,048 105,765 25,607 50,726 16,777 12,654 3,213 129,569 18,477 11,078 7,399 107,701 27,118 49,930 17,476 13,177 3,390 133,291 19,159 11,008 8,151 110,239 28,030 50,475 18,407 13,326 3,893 135,907 19,486 11,923 7,563 112,915 28,233 51,503 19,982 13,197 3,507 21,930 12,519 9,411 113,313 29,464 51,876 18,906 13,068 3,315 1976-—Jan. 23,733 13,846 9,887 112,802 28,513 50,498 20,317 13,476 3,365 Feb. 142,095 23,822 15,016 8,806 115,292 29,829 51,625 19,518 14,318 2,982 25,961 14,286 11,674 116,539 31,273 '51,634 19,080 '14,552 3,060 27,512 15,654 11,858 120,257 31,487 54,524 19,685 14,561 3,091 IN UNITED KINGDOM 61,732 2,431 136 2,295 57,311 3,944 34,979 8,140 10,248 1,990 . .1973-—Dec. .. .Total, all currencies 3,978 510 3,468 63,409 4,762 32,040 15,258 11,349 2,418 .,1974—Dec. 68,708 4,772 1,337 3,435 61,772 5,325 28,957 16,726 10,764 2,164 ..........1975-—May 70,751 4,668 1,451 3,217 63,857 7,030 30,030 15,524 11,274 2,226 70,382 4,679 1,718 2,961 63,501 6,475 30,636 15,312 11,077 2,203 July 72,457 5,251 1,904 3,348 65,012 6,260 32,097 15,617 11,038 2,194 .Aug. 72,120 5,112 1,833 3,279 64,962 6,396 33,130 14,486 10,950 2,046 72,742 4,905 1,766 3,139 65,699 6,746 32,334 14,909 11,711 2,138 73,924 5,497 2,028 3,468 66,267 6,470 33,340 15,180 11,275 2,161 74,883 5,646 2,122 3,523 67,261 6,494 32,985 16,553 11,229 1,976 73,437 5,645 1,749 3,896 65,914 6,444 33,534 15,053 10,882 1,878 ..........1976-—Jan. 72,963 5,491 1,914 3,577 65,544 6,648 31,444 16,463 10,989 1,928 Feb. 74,668 5,382 1,549 3,833 67,217 7,099 32,485 15,905 11,729 2,069 74,055 6,105 1,764 4,340 65,977 6,898 '31,805 15,521 '11,752 1,974 75,926 6,483 1,796 4,687 67,212 7,030 33,189 15,782 11,212 2,231 39,689 2,173 113 2,060 36,646 2,519 22,051 5,923 6,152 870 ..........1973-—Dec. • Payable in U.S. dollars 49,666 3,744 484 3,261 44,594 3,256 20,526 13,225 7,587 1,328 ..........1974-—Dec. 49,479 4,487 1,314 3,173 43,784 4,220 18,640 14,135 6,789 1,208 ..........1975-—May 51.848 4,369 1,412 2,957 46,312 5,962 20,039 13,083 7,228 1,167 .June 51,826 4,421 1,684 2,737 46,217 5,478 20,775 12,915 7,049 1,188 July 54,017 4,975 1,873 3,103 47,912 5,288 22,087 13,249 7,287 1,129 . Aug. 54,683 4,889 1,808 3,081 48,814 5,456 23,645 12,182 7,531 980 54,478 4,696 1,735 2,961 48,660 5,708 22,452 12,500 7,999 1,123 56,696 5,288 2,009 3,279 50,185 5,478 23,641 12,999 8,066 1,223 57,820 5,415 2,083 3,332 51,466 5,442 23,349 14,498 8,176 940 56,039 5,446 1,732 3,714 49,676 5,422 23,369 13,070 7,816 917 ..........1976-—Jan. 55.848 5,311 1,901 3,410 49,606 5,471 21,911 14,326 7,899 931 56,266 5,179 1,509 3,670 50,126 5,969 21,973 13,710 8,474 961 255,750 5,880 1,723 4,156 48,992 5,771 '21,230 13,450 '8,541 877 57,923 6,271 1,759 4,513 50,727 5,863 22,544 13,914 8,406 925 IN BAHAMAS AND CAYMANS * 23,771 1,573 307 1,266 21,747 5,508 14,071 492 1,676 451 -Dec. .. .Total, all currencies 31,733 4,815 2,636 2,180 26,140 7,702 14,050 2,377 2,011 778 38,198 9,090 6,766 2,324 28,309 6,872 16,018 2,977 2,441 799 -May 39,646 10,866 8,322 2,544 27,987 8,075 14,482 3,036 2,393 793 .June 39,614 9,991 7,407 2,584 28,933 8,401 15,539 2,500 2,492 690 .July 41,624 8,800 5,715 3,085 31,913 9,128 17,317 2,860 2,607 911 . Aug. 41,601 9,928 6,490 3,439 30,861 8,918 16,834 2,570 2,540 812 .Sept. 44,166 10,833 7,056 3,778 32,327 9,725 17,296 2,775 2,577 961 44,471 11,082 6,710 4,372 32,239 10,553 15,972 3,230 2,483 1,150 45,203 11,146 7,628 3,519 32,950 10,569 16,726 3,308 2,348 1,106 48,694 13,110 8,088 5,022 34,475 11,169 17,603 3,416 2,287 1,109 50,276 15,016 9,197 5,820 34,159 10,231 18,081 3,407 2,440 1,100 Feb. 51,075 15,469 10,915 4,554 34,931 10,850 18,332 2,998 2,751 676 .Mar. 54,398 '16,822 9,904 r6,918 36,604 11,903 18,872 2,970 2,858 972 .Apr. 257,247 18,230 11,529 6,702 38,167 11,918 20,268 2,950 3,031 849 .May* Digitized for FFoRr AnoSteEs Rse e p. A-74. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A72 INTL. CAPITAL TRANSACTIONS OF THE U.S. □ AUGUST 1976 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 End of United period Deposits U se .S cu . r T it r i e e a s s 1 . Ear g m o a ld rked period Total Deposits i S n t h e v r o e m r s t t ­ ­ Deposits i S n t h e v r o e m r s t t ­ ­ K d i o n m g­ Canada ments 1 ments 1 197 2 325 50,934 215,530 197 3 251 52,070 217,068 1972..................... 2,374 1,910 55 340 68 911 536 197 4 418 55,600 16,838 1973..................... 3,164 2,588 37 435 105 1,118 765 1974'................... 3,357 2,591 68 429 268 1,350 967 1975—July.. 369 60,999 16.803 Aug.. 342 60,120 16.803 1975—Apr.'.... 3,472 2,488 65 373 545 1,089 1,289 Sept.. 324 58,420 16,795 May'.... 3,298 2,253 66 453 526 931 1,254 Oct... 297 60,307 16,751 June'.... 3,250 2,177 214 427 432 997 1,142 Nov.. 346 60,512 16.745 July'___ 3,334 2,207 246 479 402 925 1,122 Dec.. 352 60,019 16.745 Aug.'---- 3,562 2,291 239 512 520 1,052 1,322 Sept.'___ 3,696 2,456 266 478 496 1,139 1,261 1976—Jan... 294 61,796 16,669 Oct.'. ... 3,527 2,498 351 429 249 1,199 1,167 Feb... 412 62,640 16,666 Nov.'___ 3,922 2,709 468 461 284 1,308 1,382 Mar.. 305 61,271 16,660 Dec.'.... 3,782 2,699 332 510 241 1,304 1,148 Apr... 305 62,527 16,657 May. 303 63,225 16,647 1976—Jan 4,206 3,081 374 476 274 1,506 1,312 June . 349 63,212 16,633 Feb.......... 4,416 3,265 377 449 325 1,508 1,357 July.. 295 62,955 16,607 Mar......... 4,410 3,352 393 437 228 1,690 1,325 Apr.......... 4,936 3,851 412 435 238 2,061 1,354 May®.... 5,175 4,087 426 455 207 1,912 1,495 1 Marketable U.S. Treasury bills, certificates of in­ debtedness, notes, and bonds and nonmarketable U.S. Treasury securities payable in dollars and in foreign 1 Negotiable and other readily transferable foreign obligations payable on demand currencies. or having a contractual maturity of not more than 1 year from the date on which the 2 The value of earmarked gold increased because of the obligation was incurred by the foreigner. changes in par value of the U.S. dollar in May 1972, and in Oct. 1973. Note.—Data represent the liquid assets abroad of large nonbanking concerns in the United States. They are a portion of the total claims on foreigners reported by Note.—Excludes deposits and U.S. Treasury securities nonbanking concerns in the United States and are included in the figures shown in held for international and regional organizations. Ear­ Table 22. marked gold is gold held for foreign and international accounts and is not included in the gold stock of the United States. 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 1972—Sept........................ 2,933 2,435 498 5,487 4,833 426 228 f 3,119 2,635 484 5,721 5,074 410 237 I 3,417 2,948 469 6,302 5,643 393 267 1973—Mar.'..................... 3,320 2,848 472 7,017 6,147 456 414 June'..................... 3,295 2,772 523 7,290 6,448 493 349 Sept.'..................... 3,579 2,931 648 7,625 6,698 528 399 Dec.'..................... 4,006 3,290 716 8,482 7,569 493 421 1974—Mar.'..................... 4,414 3,590 823 10,475 9,541 407 526 June'..................... 5,139 4,184 955 11,046 10.122 429 496 Sept.'..................... 5,605 4,656 949 10,698 9,730 430 537 Dec.'..................... 5,916 5,007 909 11,276 10,219 473 584 1975—Mar.'..................... 5,930 5,068 862 10,929 9,798 453 678 June'..................... 5,924 5,091 834 10,886 9,606 479 801 Sept.'..................... 5,997 5,149 849 11,712 10,364 529 819 Dec......................... 5,958 5,353 605 12,244 11,069 565 611 1976—Mar.®..................... 6,264 5,598 666 12,808 11,759 487 562 1 Data on the 2 lines shown for this date differ preceding date; figures on the second line are compa­ because 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

AUGUST 1976 □ INTL. CAPITAL TRANSACTIONS OF THE U.S. A73 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 1975 1976 1975 1976 Mar. June Sept. Dec. Mar.p Mar. June Sept. Dec. Mar.p Europe: Austria........................................................ 26 22 18 14 6 15 13 15 16 17 Belgium-Luxembourg.............................. 480 340 336 294 291 137 132 131 133 116 Denmark.................................................... 23 14 8 9 12 35 22 24 39 35 Finland....................................................... 16 12 14 14 10 77 87 114 91 36 France......................................................... 151 137 150 148 204 328 287 311 300 372 Germany..................................................... 352 293 276 151 153 276 346 319 357 306 Greece......................................................... 25 27 21 19 25 59 69 56 33 40 Italy............................................................. 109 110 156 173 126 309 300 380 382 408 Netherlands................................................ 122 143 154 115 165 157 135 139 172 182 Norway....................................................... 9 8 13 20 23 35 41 48 41 58 Portugal...................................................... 13 13 13 4 3 42 32 39 44 45 Spain........................................................... 55 60 75 82 70 360 324 315 408 514 Sweden........................................................ 32 30 47 24 25 66 74 100 62 80 Switzerland................................................ 155 168 167 130 159 86 113 220 242 207 Turkey......................................................... 12 14 22 25 14 33 28 31 27 27 United Kingdom...................................... 1,192 1,054 945 970 923 1,655 1,555 1,781 1,905 2,291 Yugoslavia.................................................. 52 45 60 76 91 33 32 24 36 30 Other Western Europe............................ 5 4 5 6 6 23 16 19 14 18 Eastern Europe.......................................... 45 49 38 31 33 114 154 170 219 186 Total.................................................... 2,875 2,545 2,518 2,304 2,339 3,838 3,761 4,238 4,519 4,970 Canada............................................................ 263 283 299 295 314 1,859 1,954 2,102 2,124 2,236 Latin America: Argentina.................................................... 31 30 28 31 35 76 63 52 58 48 Bahamas..................................................... 387 357 290 270 376 615 631 686 662 882 Brazil........................................................... 121 127 116 96 91 378 349 385 403 470 Chile............................................................ 23 15 13 14 11 69 57 41 38 28 Colombia.................................................... 12 12 14 17 16 54 50 47 49 47 Cuba............................................................ * * * * * 1 1 1 1 1 Mexico......................................................... 69 71 81 82 92 336 322 317 352 331 Panama....................................................... 18 27 19 24 17 110 128 103 92 86 Peru............................................................. 18 16 19 23 24 46 50 48 41 36 Uruguay...................................................... 3 3 2 3 2 15 5 5 4 4 Venezuela................................................... 39 45 56 100 163 180 166 153 167 147 Other L.A. republics................................ 65 67 69 71 72 193 179 165 157 167 Neth. Antilles and Surinam................... 56 60 76 35 58 16 13 12 12 7 Other Latin America................................ 134 145 142 138 214 196 159 192 301 292 Total.................................................... 975 973 924 903 1,171 2,286 2,171 2,205 2,337 2,546 Asia: China, People’s Republic of (China Mainland).............................................. 8 6 2 6 5 19 32 45 65 35 China, Rep. of (Taiwan)........................ 102 100 101 97 111 122 125 152 164 100 Hong Kong................................................ 19 30 29 18 24 83 85 85 111 67 India............................................................ 10 21 22 7 9 32 39 48 39 60 Indonesia.................................................... 63 87 104 137 137 117 147 137 169 194 Israel............................................................ 62 62 45 29 23 46 60 63 54 42 Japan........................................................... 327 273 279 296 308 1,326 1,250 1,269 1,141 1,170 Korea........................................................... 47 43 63 69 54 165 178 207 265 108 Philippines.................................................. 19 17 15 14 19 83 91 93 99 106 Thailand..................................................... 9 6 8 18 18 30 25 21 22 21 Other Asia.................................................. 642 841 908 1,027 958 394 465 532 555 643 1,308 1,488 1,575 1,717 1,667 2,416 2,497 2,652 2,683 2,546 Africa : Egypt........................................................... 5 34 34 37 30 24 15 15 22 22 South Africa.............................................. 54 65 79 100 112 104 104 78 93 79 Zaire............................................................ 17 9 9 6 7 18 17 22 28 28 Other Africa.............................................. 137 209 212 240 347 236 218 263 287 239 217 323 341 391 502 387 364 388 440 378 Other countries: Australia..................................................... 60 37 52 55 47 97 99 79 101 96 All other..................................................... 31 18 21 17 18 45 39 48 39 37 Total................................................... 91 55 73 73 65 141 138 127 140 133 International and regional.......................... 201 257 267 276 219 1 1 * 1 1 Grand total........................................ 5,930 5,924 5,997 5,958 6,277 10,929 10,886 11,712 12,244 12,810 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

A74 INTL. CAPITAL TRANSACTIONS OF THE U.S. □ AUGUST 1976 24. LONG-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS REPORTED BY NONBANKING CONCERNS (Amounts outstanding; in millions of dollars) Claims End of period Total Country or area liabilities Total K U in n g i d te 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 c r a Japan O A t s h i e a r Africa o A th l e l r 1971—Dec........................... 3,138 3,068 128 704 717 174 60 653 136 325 86 84 1972—Sept.......................... 3,448 3,187 128 695 757 177 63 662 132 390 89 96 T^ao 1 J 3,540 3,312 163 715 775 184 60 658 156 406 87 109 \ 3,603 3,666 191 745 1,141 187 64 703 133 378 86 38 1973—Mar.......................... 3,781 3,798 156 802 1,151 165 63 796 123 393 105 45 June......................... 3,785 3,853 180 805 1,163 146 65 825 124 390 108 48 Sept........................... 4,000 3,999 216 822 1,166 147 73 832 134 449 108 51 Dec........................... 3,886 4,057 290 761 1,172 145 79 829 125 488 115 53 1974—Mar........................... 3,836 4,194 369 737 1,210 194 81 809 123 488 122 61 June......................... 3,536 4,191 363 699 1,226 184 138 756 123 515 126 61 Sept........................... 3,371 4,324 370 704 1,256 181 145 796 119 571 122 59 Dec........................... 3,850 4,544 364 644 1,290 187 153 1,045 112 569 127 54 1975—Mar.......................... 4,129 4,523 340 655 1,334 182 169 1,008 102 540 139 54 June......................... 4,230 4,454 299 634 1,328 182 161 982 98 556 146 68 Sept........................... 4,180 4,590 366 620 1,347 177 228 930 95 608 154 67 Dec........................... 4,232 4,971 396 589 1,426 171 216 1,251 90 604 168 61 1976—Mar p....................... 4,046 5,162 348 586 1,474 182 199 1,386 91 621 214 62 1 Data on the 2 lines shown for this data 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 money 2 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 1975. 7.36 7.34 10.57 10.16 10.13 7.23 7.89 3.51 4.23 4.41 3.65 6.25 1975--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 2.89 1.51 6.00 Sept.............. 8.37 7.74 10.43 10.36 9.40 6.50 6.91 3.38 4.25 2.60 .94 5.50 Oct............... 8.28 7.92 11.38 11.42 9.88 6.93 6.53 3.13 3.27 4.22 4.35 5.50 Nov.............. 8.44 8.29 11.21 11.10 11.34 7.00 6.74 3.13 3.36 4.67 4.19 5.50 Dec............... 8.59 8.66 10.88 10.82 9.61 7.00 6.42 3.13 3.84 4.88 4.34 5.50 1976-—Jan................ 8.59 8.75 9.83 9.87 9.08 5.75 6.38 3.13 3.58 4.52 3.76 5.00 Feb............... 8.70 8.74 8.86 8.81 8.42 6.50 7.27 3.13 3.08 2.86 3.05 5.00 Mar.............. 9.04 9.05 8.66 8.46 6.25 6.50 7.63 3.13 3.62 2.50 2.12 4.78 Apr............... 8.97 8.65 9.10 8.97 7.69 6.50 7.56 3.13 2.76 2.96 2.50 4.50 May............. 8.93 8.96 10.31 10.45 10.16 6.50 7.53 3.13 3.68 3.60 3.98 4.50 June............. 8.99 9.04 11.05 10.94 10.69 6.50 7.63 3.13 4.23 5.68 4.82 4.50 July.............. 9.02 8.98 10.89 10.88 6.50 8.33 3.13 4.38 4.50 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 $53,545 million and $54,160 million, respectively, on May 31, 1976. 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

AUGUST 1976 o CENTRAL BANK AND EXCHANGE RATES A75 26. CENTRAL BANK RATES FOR DISCOUNTS AND ADVANCES TO COMMERCIAL BANKS (Per cent per annum) Rate as of July 31, 1976 Rate as of July 31, 1976 Country Country Per Month Per Month cent effective cent effective Argentina..................................... 18.0 Feb. 1972 12.0 Mar. 1976 Austria.................................... 4.0 June 1976 6.5 Oct. 1975 Belgium........................................ 8.0 July 1976 4.5 June 1942 Brazil............................................ 28.0 May 1976 Netherlands............................ 5.0 June 1976 Canada......................................... 9.5 Mar. 1976 5.0 Oct. 1975 Denmark...................................... 8.5 Mar. 1976 6.0 June 1976 France.......................................... 9.5 July 1976 Switzerland.............................. 2.0 June 1976 Germany, Fed. Rep. of.......... 3.5 Sept. 1975 United Kingdom................... 11 .5 May 1976 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 borrowings 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, 4*/£ Argentina—3 and 5 per cent for certain rural and industrial paper, de­ per cent for advances against government bonds, and 5% 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) 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 1975...................... 130.77 5.7467 2.7253 98.297 17.437 23.354 40.729 11.926 222.16 .15328 .33705 1975—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........... 126.87 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 Nov........... 126.26 5.4535 2.5618 98.631 16.564 22.684 38.619 11.238 204.84 .14721 .33053 Dec............ 125.38 5.3986 2.5311 98.627 16.253 22.428 38.144 11.134 202.21 .14645 .32715 1976—Jan............ 125.65 5.4300 2.5443 99.359 16.231 22.339 38.425 11.178 202.86 .14245 .32826 Feb............ 125.85 5.4628 2.5554 100.652 16.278 22.351 39.034 11.186 202.62 .13021 .33157 Mar........... 124.79 5.4383 2.5480 101.431 16.273 21.657 39.064 11.157 194.28 .12113 .33276 Apr............ 123.72 5.4964 2.5667 101.668 16.553 21.411 39.402 11.123 184.63 .11371 .33433 May.......... 123.37 5.4535 2.5517 102.02 16.487 21.272 39.035 11.080 180.79 .11676 .33444 June.......... 122.75 5.4136 2.5220 102.71 16.314 21.109 38.797 10.980 176.40 .11780 .33424 July........... 123.59 5.4500 2.5182 102.86 16.225 20.651 38.842 11.205 178.50 .11943 .33940 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) 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 1975....................... 41.753 8.0000 39.632 121.16 19.180 3.9286 136.47 1.7424 24.141 38.743 222.16 1975—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 Nov........... 38.929 8.0000 37.638 104.75 18.116 3.7318 114.69 1.6869 22.788 37.683 204.84 Dec........... 38.670 8.0000 37.234 103.77 17.988 3.6836 114.75 1.6765 22.685 37.970 202.21 1976—Jan............ 38.696 8.0000 37.429 104.06 17.992 3.6562 114.80 1.6751 22.831 38.418 202.86 Feb............ 38.998 8.0000 37.529 104.25 18.098 3.6394 114.79 1.5523 22.861 38.912 202.62 Mar.......... 39.047 8.0000 37.149 102.42 18.022 3.4987 114.83 1.4947 22.702 38.980 194.28 Apr........... 39.032 8.0000 37.215 100.19 18.201 3.3759 114.84 1.4864 22.709 39.531 184.63 May.......... 39.079 8.0000 36.811 99.33 18.184 3.3195 114.85 1.4788 22.653 40.205 180.79 June.......... 39.148 8.0000 36.524 98.09 18.020 3.2145 114.94 1.4724 22.475 40.484 176.40 July........... 39.589 8.0000 36.643 99.05 17.899 3.1810 114.83 1.4685 22.379 40.242 178.50 Note.—Averages of certified noon buying rates in New York for cable transfers. For description of rates and back data, see “International Fi­ nance,” Section 15 of the Board’s Supplement to Banking and Monetary Statistics, 1962. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Board of Governors of the Federal Reserve System Arthur F. Burns, Chairman Stephen S. Gardner, Vice Chairman Henry C. W allich Philip E. Coldwell Philip C. Jackson, Jr. J. Charles Partee David M. Lilly OFFICE OF OFFICE OF BOARD MEMBERS OFFICE OF STAFF STAFF DIRECTOR FOR MANAGEMENT DIRECTOR FOR MONETARY POLICY Thomas J. O’Connell, Counsel to the John M. Denkler, Staff Director Chairman Stephen H. Axilrod, Staff Director Robert J. Lawrence, Deputy Staff Joseph R. Coyne, Assistant to the Board Arthur L. Broida, Deputy Staff Director Director Kenneth A. Guenther, Assistant to the Board Murray Altmann, Assistant to the Board Gordon B. Grimwood, Assistant Director Jay Paul Brenneman, Special Assistant to the Peter M. Keir, Assistant to the Board and Program Director for Board Stanley J. Sigel, Assistant to the Board Contingency Planning Frank O’Brien, Jr., Special Assistant to the Normand R. V. Bernard, Special Assistant to William W. Layton, Director of Equal Board the Board Employment Opportunity Donald J. Winn, Special Assistant to the Brenton C. Leavitt, Program Director for Board Banking Structure DIVISION OF RESEARCH AND STATISTICS Lyle E. Gramley, Director James L. Kichline, Associate Director Joseph S. Zeisel, Associate Director Edward C. Ettin, Adviser LEGAL DIVISION John H. Kalchbrenner, Adviser James B. Eckert, Associate Adviser John D. Hawke, Jr., General Counsel t John J. Mingo, Associate Adviser Baldwin B. Tuttle, Deputy General Eleanor J. Stockwell, Associate Adviser DIVISION OF FEDERAL RESERVE Counsel Helmut F. Wendel, Associate Adviser BANK EXAMINATIONS AND BUDGETS Robert E. Mannion, Assistant General James R. Wetzel, Associate Adviser Counsel Jared J. Enzler, Assistant Adviser William H. Wallace, Director Allen L. Raiken, Assistant General Counsel Robert M. Fisher, Assistant Adviser Albert R. Hamilton, Associate Director Gary M. Welsh, Assistant General Counsel J. Cortland G. Peret, Assistant Adviser Clyde H. Farnsworth, Jr., Assistant Director Charles R. McNeill, Assistant to the Stephen P. Taylor, Assistant Adviser P. D. Ring, Assistant Director General Counsel Levon H. Garabedian, Assistant Director A76 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DIVISION OF OFFICE OF DIVISION OF INTERNATIONAL FINANCE FEDERAL RESERVE BANK OPERATIONS SAVER AND CONSUMER AFFAIRS 1*Ralpfi C. Bryant, Director James R. Kudlinski, Director Frederic Solomon, Assistant to the John E. Reynolds, Acting Director W alter A. Althausen, Assistant Director Board and Director Robert F. Gemmill, Adviser Janet O. Hart, Deputy Director Reed J. Irvine, Adviser Brian M. Carey, Assistant Director Jerauld C. Kluckman, Assistant Director 1*Helen B. Junz, Adviser Harry A. Guinter, Assistant Director Robert S. Plotkin, Assistant Director Samuel Pizer, Adviser George B. Henry, Associate Adviser DIVISION OF DATA PROCESSING Charles J. Siegman, Associate Adviser OFFICE OF THE SECRETARY Edwin M. Truman, Associate Adviser Charles L. Hampton, Director Bruce M. Beardsley, Associate Director Theodore E. Allison, Secretary Uyless D. Black, Assistant Director * Richard D. Abrahamson, Assistant Secretary Glenn L. Cummins, Assistant Director Griffith L. Garwood, Assistant Secretary Robert J. Zemel, Assistant Director fOn leave of absence. DIVISION OF PERSONNEL DIVISION OF BANKING SUPERVISION AND REGULATION Keith D. Engstrom, Director Charles W. Wood, Assistant Director Brenton C. Leavitt, Director Ralph H. Gelder, Associate Director OFFICE OF THE CONTROLLER John E. Ryan, Associate Director William W. Wiles, Associate Director John Kakalec, Controller Peter E. Barna, Assistant Director Tyler E. Williams, Jr., Assistant Controller Frederick R. Dahl, Assistant Director Jack M. Egertson, Assistant Director DIVISION OF ADMINISTRATIVE SERVICES John N. Lyon, Assistant Director John T. McClintock, Assistant Director W alter W. KreimaNn, Director Thomas E. Mead, Assistant Director Donald E. Anderson, Assistant Director Thomas A. Sidman, Assistant Director John D. Smith, Assistant Director *On loan from the Federal Reserve Bank of Chicago. A77 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A78 Federal Open Market Committee Arthur F. Burns, Chairman Paul A. Volcker, Vice Chairman John J. Balles Stephen S. Gardner J. Charles Partee Robert P. Black Philip C. Jackson, Jr. Henry C. W allich Philip E. Coldwell Monroe Kimbrel W illis J. Winn David M. Lilly Arthur L. Broida, Secretary Lyle E. Gramley, Economist Murray Altmann, Deputy Secretary (Domestic Business) Normand R. V. Bernard, Assistant Harry Brandt, Associate Economist Secretary Richard G. Davis, Associate Economist Thomas J. O’Connell, General Counsel William J. Hocter, Associate Economist Edward G. Guy, Deputy General Counsel Michael W. Keran, Associate Economist Baldwin B. Tuttle, Assistant General James L. Kichline, Associate Economist Counsel James Parthemos, Associate Economist Stephen H. Axilrod, Economist John E. Reynolds, Associate Economist (Domestic Finance) Joseph S. Zeisel, Associate Economist Alan R. Holmes, Manager, System Open Market Account Peter D. Sternlight, Deputy Manager for Domestic Operations Scott E. Pardee, Deputy Manager for Foreign Operations Federal Advisory Council Ellmore C. Patterson, second federal reserve district, President William F. Murray, seventh federal reserve district, Vice President Richard D. Hill, first federal Edwin S. Jones, eighth federal reserve district reserve district James F. Bodine, third federal Donald R. Grangaard, ninth reserve district federal reserve district M. Brock Weir, fourth federal Eugene H. Adams, tenth federal reserve district reserve district John H. Lumpkin, fifth federal Ben F. Love, eleventh federal reserve district reserve district Lawrence A. Merrigan, sixth Gilbert F. Bradley, twelfth federal reserve district 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

A79 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 Frank R. Milliken Paul A. Volcker Robert H. Knight Thomas M. Timlen Buffalo ............................ 14240 Rupert Warren John T. Keane PHILADELPHIA 19105 John R. Coleman David P. Eastburn John W. Eckman Mark H. Willes CLEVELAND* .............44101 Horace A. Shepard Willis J. Winn Robert E. Kirby Walter H. MacDonald Cincinnati ..................... 45201 Lawrence H. Rogers, II Robert E. Showalter Pittsburgh ..................... 15230 G. Jackson Tankersley Robert D. Duggan RICHMOND* ...................23261 E. Angus Powell 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 and Records Center 22701 Albert D. Tinkelenberg ATLANTA ....................... 30303 H. G. Pattillo Monroe Kimbrel Clifford M. Kirtland, Jr. Kyle K. Fossum Birmingham ................ 35202 Harold B. Blach, Jr. Hiram J. Honea Jacksonville ................ 32203 Egbert R. Beall Edward C. Rainey Miami .............................. 33152 Castle W. Jordan W. M. Davis Nashville ....................... 37203 James W. Long Jeffrey J. Wells New Orleans .............. 70161 Edwin J. Caplan George C. Guynn CHICAGO* ... ............ 60690 Peter B. Clark Robert P. Mayo Robert H. Strotz Daniel M. Doyle Detroit .............................. 48231 Jordan B. Tatter William C. Conrad ST. LOUIS ....................... 63166 Edward J. Schnuck Lawrence K. Roos William B. Walton Eugene A. Leonard Little Rock ................... 72203 Ronald W. Bailey John F. Breen Louisville ..................... 40201 William H. Stroube Donald L. Henry Memphis ....................... 38101 Robert E. Healy L. Terry Britt MINNEAPOLIS 55480 James P. McFarland Bruce K. MacLaury Stephen F. Keating Clement A. Van Nice Helena .............................. 59601 James C. Garlington John D. Johnson KANSAS CITY .............64198 Robert T. Person Roger Guffey Harold W. Andersen John T. Boy sen 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 J. Luther Davis Fredric W. Reed Houston ......................... 77001 Thomas J. Barlow James L. Cauthen San Antonio ................ 78295 Margaret Scarbrough Wilson 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 Lloyd E. Cooney 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 24 pp. $.35. Sec. 15. International Finance. 1962. Functions. 1974. 125pp. $1.00each; lO orm ore 92 pp. $.65. Sec. 16 (New). Consumer Credit. to one address, $.75 each. 1965. 103 pp. $.65. The Federal Funds M arket. 1959. Ill pp. $1.00 Annual Report each; 10 or more to one address, $.85 each. Federal Reserve Bulletin. M onthly. $20.00 per Trading in Federal Funds. 1965. 116 pp. $1.00 year or $2.00 each in the United States, its posses­ each; 10 or more to one address, $.85 each. sions, Canada, and M exico; 10 or more of same Industrial Production— 1971 Edition. 1972. 383 issue to one address, $18.00 per year or $1.75 pp. $4.00 each; 10 or more to one address, $3.50 each. Elsewhere, $24.00 per year or $2.50 each. each. Federal Reserve Chart Book on Financial and The Performance of Bank Holding Companies. Business Statistics. M onthly. Subscription in­ 1967. 29 pp. $.25 each; 10 or more to one address, cludes one issue of Historical Chart Book. $12.00 $.20 each. per year or $1.25 each in the United States, its Bank Credit-Card and Check-Credit Plans. 1968. possessions, Canada, and M exico; 10 or more of 102 pp. $1.00 each; 10 or more to one address, same issue to one address, $1.00 each. Elsewhere, $.85 each. $15.00 per year or $1.50 each. Survey of Financial Characteristics of Con­ Historical Chart Book. Issued annually in Sept. sumers. 1966. 166 pp. $1.00 each; 10 or more Subscription to monthly chart book includes one to one address, $.85 each. issue. $1.25 each in the United States, its posses­ Survey of Changes in Family Finances. 1968. 321 sions, Canada, and M exico; 10 or more to one pp. $1.00 each; 10 or more to one address, $.85 address, $1.00 each. Elsewhere, $1.50 each. each. Capital M arket Developments. W eekly. $15.00 per Report of the Joint Treasury-Federal Reserve year or $.40 each in the United States, its posses­ Study of the U.S. Government Securities sions, Canada, and M exico; 10 or more of same M arket. 1969. 48 pp. $.25 each; 10 or more to issue to one address, $13.50 per year or $.35 each. one address, $.20 each. Elsewhere, $20.00 per year or $.50 each. Joint Treasury-Federal Reserve Study of the Selected Interest and Exchange Rates— W eekly Government Securities M arket: Staff Stud­ Series of Charts. W eekly. $15.00 per year or ies— Part 1. 1970. 86 pp. $.50 each; 10 or more $.40 each in the United States, its possessions, to one address, $.40 each. Part 2. 1971. 153 pp. Canada, and M exico; 10 or more of same issue and Part 3. 1973. 131 pp. Each volume $1.00; to one address, $13.50 per year or $.35 each. 10 or more to one address, $.85 each. Elsewhere, $20.00 per year or $.50 each. Open M arket Policies and Operating Proce­ The Federal Reserve Act, as amended through De­ dures— Staff Studies. 1971. 218 pp. $2.00 cember 1971, with an appendix containing provi­ each; 10 or more to one address, $1.75 each. sions of certain other statutes affecting the Federal Reappraisal of the Federal Reserve Discount Reserve System. 252 pp. $1.25. M echanism. Vol. 1. 1971. 276 pp. Vol. 2. 1971. Regulations of the Board of Governors of the 173 pp. Vol. 3. 1972. 220 pp. Each volume $3.00; Federal Reserve System 10 or more to one address, $2.50 each. Published Interpretations of the Board of Gov­ The Econometrics of Price Determination Con­ ernors, as of Dec. 31, 1975. $2.50. ference, October 30-31, 1970, W ashington, D.C. Supplement to Banking and M onetary Statistics. 1972. 397 pp. Cloth ed. $5.00 each; 10 or more Sec. 1. Banks and the Monetary System. 1962. to one address, $4.50 each. Paper ed. $4.00 each; 35 pp. $.35. Sec. 2. Member Banks. 1967. 59 10 or more to one address, $3.60 each. pp. $.50. Sec. 5. Bank Debits. 1966. 36 pp. $.35. Federal Reserve Staff Study: W ays to M oderate Sec. 6. Bank Income. 1966. 29 pp. $.35. Sec. Fluctuations in Housing Construction, Dec. 9. Federal Reserve Banks. 1965. 36 pp. $.35. Sec. 1972. 487 pp. $4.00 each; 10 or more to one 10. M ember Bank Reserves and Related Items. address, $3.60 each. 1962. 64 pp. $.50. Sec. 11. Currency. 1963. 11 Lending Functions of the Federal Reserve pp. $.35. Sec. 12. M oney Rates and Securities Banks. 1973. 271 pp. $3.50 each; 10 or more Markets. 1966. 182 pp. $.65. Sec. 14. Gold. 1962. to one address, $3.00 each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Board Publications A 81 Introduction to Flow of Funds. 1975. 64 pp. $.50 Revision of Bank Credit Series. 12/71. each; 10 or more to one address, $.40 each. Assets and Liabilities of Foreign Branches of Improved Fund Availability at Rural Banks (Re­ U.S. Banks. 2/72. port and study papers of the Committee on Rural Bank Debits, Deposits, and Deposit Turnover— Banking Problems). 1975. 133 pp. $1.00; 10 or Revised Series. 7/72. more to one address, $.85 each. Yields on Newly Issued Corporate Bonds. 9/72. Improving the M onetary Aggregates (Report of the Recent Activities of Foreign Branches of U.S. Advisory Committee on M onetary Statistics). Banks. 10/72. 1976. 43 pp. $1.00 each; 10 or more to one Revision of Consumer Credit Statistics. 10/72. address, $.85 each. One-Bank Holding Companies Before the 1970 Amendments. 12/72. STAFF ECONOM IC STUDIES Yields on Recently Offered Corporate Bonds. 5/73. Studies and papers on economic and financial subjects Capacity Utilization in M ajor M aterials Indus­ that are of general interest in the field of economic tries. 8/73. research. Credit-Card and Check-Credit Plans at Commer­ cial Banks. 9/73. Summaries Only Printed in the Bulletin Rates on Consumer Instalment Loans. 9/73. (Limited supply of mimeographed copies of full New Series for Large M anufacturing Corpora­ text available upon request for single copies) tions. 10/73. U.S. Energy Supplies and Uses, Staff Economic Household-Sector Economic Accounts, by David Study by Clayton Gehman. 12/73. F. Seiders. Jan. 1975. 84 pp. Capacity Utilization for M ajor M aterials: Re­ The Performance of Individual Bank Holding vised M easures. 4/74. Companies, by Arthur G. Fraas. Aug. 1975. Numerical Specifications of Financial Variables 27 pp. and Their Role in M onetary Policy. 5/74. The Growth of M ultibank Holding Companies: Inflation and Stagnation in M ajor Foreign In­ 1956-73, by Gregory E. Boczar. Apr. 1976. 27 dustrial Countries. 10/74. pp. The Structure of M argin Credit. 4/75. Extending M erger Analysis Beyond the Single- New Statistical Series on Loan Commitments at M arket Framework, by Stephen A. Rhoades. Selected Large Commercial Banks. 4/75. M ay 1976. 25 pp. Recent Trends in Federal Budget Policy. 7/75. Seasonal Adjustment of — Currently Pub­ Banking and Monetary Statistics, 1974. Selected lished and Alternative M ethods, by Edward series of banking and monetary statistics for 1974 R. Fry. M ay 1976. 22 pp. only. 2/75, 3/75, 4/75 and 7/75. Recent Developments in International Financial M arkets. 10/75. Printed in Full in the Bulletin M IN N IE : A S m all V ersion of the M IT-PENN-SSRC Econometric M odel, Staff Staff Economic Studies shown in list below. Economic Study by Douglas Battenberg, Jared J. Enzler and Arthur M. Havenner. 11/75. An Assessment of Bank Holding Companies, Staff REPRINTS Economic Study by Robert J. Lawrence and (Except for Staff Papers, Staff Economic Studies, and Samuel H. Talley. 1/76. some leading articles, most of the articles reprinted do Industrial Electric Power Use. 1/76. not exceed 12 pages.) Revision of M oney Stock M easures. 2/76. Survey of Finance Companies, 1975. 3/76. Seasonal Factors Affecting Bank Reserves. 2/58. Changing Patterns in U.S. International Trans­ M easures of M ember Bank Reserves. 7/63. actions. 4/76. Research on Banking Structure and Perform­ Revised Series for M ember Bank Deposits and ance, Staff Economic Study by Tynan Smith. Aggregate Reserves. 4/76. 4/66. Bank Holding Company Financial Developments A Revised Index of M anufacturing Capacity, in 1975. 4/76. Staff Economic Study by Frank de Leeuw with Changes in Bank Lending Practices, 1975. 4/76. Frank E. Hopkins and Michael D. Sherman. 11/66. Industrial Production— 1976 Revision. 6/76. U.S. International Transactions: Trends in Federal Reserve Operations in Payment M echa­ 1960-67. 4/68. nisms: A Summary. 6/76. M easures of Security Credit. 12/70. Changes in Time and Savings Deposits at Com­ Revised M easures of M anufacturing Capacity mercial Banks, October 1975-January 1976. Utilization. 10/71. 7/76. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A82 Federal Reserve Bulletin □ August 1976 Index to Statistical Tables References are to pages A-2 through A-75 although the prefix “A” is omitted in this index ACCEPTANCES, bankers, 9, 25, 27 Demand deposits: Agricultural lo„ans 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, 37 Discount rates at Federal Reserve Banks (See Interest Bonds (See also U.S. Govt, securities): rates) New issues, 37, 38, 39 Discounts and advances by Reserve Banks (See Loans) Yields and prices, 28, 29 Dividends, corporate, 40, 41 Branch banks: Assets, foreign branches of U.S. banks, 70 EM PLOYM ENT, 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 Capital accounts: Federal Home Loan M ortgage Corporation, 42, 43 Banks, by classes, 14, 17, 22 Federal Housing Administration, 42, 43, 44, 45 Federal Reserve Banks, 10 Federal intermediate credit banks, 37 Central banks, 60, 75 Federal land banks, 37 Certificates of deposit, 22 Federal National M ortgage Assn., 37, 42, 43 Commercial and industrial loans: Federal Reserve Banks: Commercial banks, 13, 16 Condition statement, 10 W eekly 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, 46, 47 Federally sponsored credit agencies, 37 Deposits at, for payment of personal loans, 24 Finance companies: Loans sold outright, 25 Loans, 18, 45, 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 instalment credit, 45, 46, 47 Deposits in U.S. banks, 3, 10, 17, 21, 72 Consumer price indexes, 50, 53 Exchange rates, 75 Consumption expenditures, 54, 55 Trade, 59 Corporations: Foreigners: Profits, taxes, and dividends, 41 Claims on, 66, 67, 68, 72, 73, 74 Sales, revenue, profits, and dividends of large Liabilities to, 22, 61, 62, 64, 65, 72, 73, 74 manufacturing corporations, 40 Security issues, 38, 39 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 M ortgage 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

A83 References are to pages A-2 through A-75 although the prefix “A” is omitted in this index INCOM E, 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 M ortgage yields, 43, 45 Insurance companies, 31, 34, 35, 42, 44 Type of holder and property mortgaged, 42-44 Insured commercial banks, 14, 16, 17, 24 Reserve position, basic, member banks, 5 Interbank deposits, 14, 20 Reserve requirements, member banks, 7 Interest rates: Reserves: Bond and stock yields, 28 Central banks and govts., 60 Business loans of banks, 26 Commercial banks, 17, 20, 22 Federal Reserve Banks, 6 Federal Reserve Banks, 10 Foreign countries, 74, 75 Member banks, 3, 4, 13, 17 Money market rates, 27 U.S. reserve assets, 59 M ortgage yields, 43, 45 Residential mortgage loans, 43, 44, 45 Prime rate, commercial banks, 26 Retail credit, 46, 47 Time and savings deposits, maximum rates, 8 Retail sales, 50 International capital transactions of U .S., 61-74 International institutions, 60-64, 66, 67-69, 73 SALES, revenue, profits, and dividends of large manu­ Inventories, 54 facturing corporations, 40 Investment companies, issues and assets, 39 Saving: Investments (See also specific types of investments): Flow of funds series, 56, 57 Banks, by classes, 14, 16, 19, 30 National income series, 54, 55 Commercial banks, 13 Savings and loan assns., 31, 35, 42, 44 Federal Reserve Banks, 10, 11 Savings deposits (See Time deposits) Life insurance companies, 31 Savings institutions, principal assets, 30, 31 Savings and loan assns., 31 Securities (See also U.S. Govt, securities): Federally sponsored agencies, 37 LABOR force, 52 International transactions, 68, 69 Life insurance companies (See Insurance companies) New issues, 37, 38, 39 Loans (See also specific types of loans): Yields and prices, 28, 29 Banks, by classes, 14, 16, 18, 30 Special Drawing Rights, 2, 10, 58, 59 Commercial banks, 13, 14, 16, 18, 23, 25, 26 State and local govts.: Federal Reserve Banks, 2, 4, 6, 10, 11 Deposits, 17, 20 Insurance companies, 31, 44 Holdings of U.S. Govt, securities, 34, 35 Insured or guaranteed by U.S., 42, 43, 44, 45 New security issues, 37, 38 Savings and loan assns., 31 Ownership of securities of, 16, 19, 30 Yields and prices of securities, 28, 29 M ANUFACTURERS: State member banks, 15, 24 Capacity utilization, 50 Stock market credit, 29, 30 Production index, 49, 50 Stocks (See also Securities): Margin requirements, 8 New issues, 38, 39 M ember banks: Yields and prices, 28, 29 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 M ining, production index, 49 UNEM PLOYM ENT, 52 Mobile home shipments, 51 U.S. balance of payments, 58 M oney 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 M ember 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, 38 Open market transactions, 9 OPEN market transactions, 9 Outstanding, by type of security, 34, 35 Ownership, 34, 35 PAYROLLS, manufacturing index, 50 Yields and prices, 28, 29 Personal income, 55 Utilities, production index, 49 Prices: Consumer and wholesale commodity, 50, 53 VETERANS Administration, 43, 44 Security, 29 Prime rate, commercial banks, 26 W EEKLY reporting banks, 18-22 Production, 48, 49, 50 Profits, corporate, 40, 41 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A84 Federal Reserve Bulletin □ August 1976 The Federal Reserve System B o u n d a rie s o f F e d e ra l R e se rv e D istric ts a n d T h e ir B ra n c h T e rrito rie s — 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 and Statistical Releases 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 partic­ n.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 charac­ issues of U.S. Govt, agencies (the flow of funds figures teristics of the data. LIST PUBLISHED SEMIANNUALLY, WITH LATEST BULLETIN REFERENCE Issue Page Anticipated schedule of release dates for individual releases June 1976 A-82 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis