Federal Reserve Bulletin, 1977-01

JANUARY 1977 FEDERAL RESERVE BULLETIN The Economy in 1976 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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FEDERAL RESERVE BULLETIN NUMBER 1 • VOLUME 63 • JANUARY 1977 CONTENTS 1 The Economy in 1976 A1 Financial and Business Statistics 15 Record of Policy Actions A70 Board of Governors and Staff of the Federal Open Market Committee A72 Open Market Committee and Staff; Federal Advisory Council 27 Law Department A73 Federal Reserve Banks and Branches 89 Announcements A74 Federal Reserve Board Publications 99 Industrial Production A76 Index to Statistical Tables A78 Map of Federal Reserve System A79 Guide to Tabular Presentation and Statistical Releases: Reference PUBLICATIONS COMMITTEE Lyle E. Gramley Joseph R. Coyne John M. Denkler Stephen H. Axilrod Janet O. Hart 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

The Economy in 1976 This article was prepared in the National In- No two business cycles are identical, howcome Section of the Division of Research and ever, and a substantial retardation in the rate Statistics. of economic expansion during 1976 was by no means predetermined. One important factor in The pace of the economic recovery that began the slowdown was the fact that real capital in the spring of 1975 accelerated in the opening spending by businesses—particularly for equipmonths of 1976. During the first quarter real ment—was unusually sluggish. These outlays gross national product increased markedly, due declined during the first two quarters of the largely to a sharp shift in the rate of inventory recovery in over-all activity—an unprecedented investment from liquidation to accumulation and event in recent cyclical experience—and the a substantial advance in consumer spending. typical cyclical resurgence in these expenditures Employment gains during this period were siz- has yet to materialize. able, and the unemployment rate declined sig- This weak performance of business capital nificantly despite rapid growth in the labor spending occurred despite a substantial recovery force. in corporate profit margins. In addition, business During the second quarter of 1976, the pace liquidity was substantially restored to pre-recesof the expansion moderated, and over the re- sion levels, and there was a downward drift in mainder of the year real output growth averaged long-term interest rates, which are still well about its long-term trend rate. With employment below their level at the trough of the recession. gains slowing and the labor force continuing to Evidently, business confidence has been shaken increase rapidly, unemployment began to rise by the turbulent economic environment of recent again, and there was little further increase in years—particularly by fears of a resurgence of the rate of utilization in industrial capacity. inflationary pressures and by the steepness of Late in the year, signs began to develop that the decline in economic activity during late 1974 the economy was emerging from this "pause" and early 1975, which generated substantial and that the pace of economic activity was Change in GNP picking up. But with unemployment extensive and with aggregate demand for goods and serv- Per cent ices still comparatively moderate, both the outgoing and incoming administrations proposed fiscal measures designed to provide tax reductions for consumers and businesses. A slowing in the rate of growth after the first year of recovery—such as occurred in 1976—is typical of cyclical expansions. As in previous postwar upswings, the proximate source of moderation in economic activity during 1976 was an ending of the stimulus provided by sharp 1973 1974 1975 1976 increases in the rate of inventory investment, Dept. of Commerce data, seasonally adjusted at annual rates. which are necessarily of a temporary nature. Real is in terms of 1972 dollars. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-2 Federal Reserve Bulletin • January 1977 GNP and final sales early 1976. When final demands began to slow, inventories of these goods rose rapidly—neces- Billions of 1972 dollars sitating widespread adjustments in production. Nondurable goods production remained essenm vjW tially flat from the spring to the fall. ^9BBBl250 By midsummer, production adjustments spread to the durable goods industries, as in- Final sales Jf ventories in these lines also became larger than business firms desired to hold. The weaker- % jf 1200 than-expected pace of business fixed capital ir I m P r lti P liq ' n u v id e a n t t i o o r n y outlays was partly responsible for this back-up of durable goods stocks; so also was the mod- 1150 erating pace of consumer spending for durable _ _ __ m B m & k ^11 goods. During the second and third quarters of m •• mm • M H H H H BH 1973 1974 1975 1976 1976 growth in real expenditures for consumer Dept. of Commerce data, seasonally adjusted at annual rates. durable goods slowed to an annual growth rate of 3 per cent, compared with 17 per cent in excess capacity. In the manufacturing sector the the first year of the recovery. rate of capacity utilization had declined to 71 per cent in the first quarter of 1975—the lowest Industrial production quarterly figure in postwar history. By the end 1967=100 of 1976 the rate of utilization had risen to a little over 80 per cent, but business firms remained very cautious about adding to capacity. A second factor in the slowdown of the pace of expansion last year was the slackening in Federal spending from earlier expectations. Growth of Federal expenditures typically moderates during an economic recovery because payments for income security slow as the economy improves. During the first three quarters of 1976, however, Federal expenditures as measured in the national income and product accounts rose at an annual rate of 5Vi per cent, or just slightly more than the rate of increase F.R. data. of the implicit GNP deflator. This weak pace Accumulating evidence suggests that busiof Federal spending—coming at a time when nesses made progress in eliminating excessive business fixed investment was also falling short inventories during the fourth quarter of 1976. of expectations—contributed to a retardation in Retail sales began to pick up in October—apthe advance of consumers' real incomes. As a parently due in part to price concessions given result, the slackening of consumer spending that by business firms—and continued to advance in had begun in the second quarter extended into November and December. This firming of conthe summer months and inventories began to sumer demands, together with the earlier adappear excessive. justments in production, helped to eliminate Actually, throughout much of 1976 busi- excessive stocks of both durable and nondurable nesses were plagued with inventory back-ups. goods, paving the way for a pick-up in the Production of nondurable goods increased at an tempo of business activity in the early months unsustainable pace in the latter half of 1975 and of 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1976 3 INCOME AND CONSUMPTION Following the tax cut and tax rebate in the spring of 1975, real consumption expenditures The decline in real disposable income during grew at an irregular pace but averaged 6.1 per the 1973-74 recession from its peak was more cent over the year ending in the first quarter severe than in any other postwar recession, of 1976. Part of this gain was due to the stimureflecting both the weakness of growth of nomi- lative effects of the 1975 tax cut, although nal income and the rapidly rising prices for reduced inflationary expectations and an imconsumer goods. Although the recovery in real proved job market in late 1975 also played a disposable income from the trough was about role. By mid-1976, however, growth in real in line with previous cyclical experience, the consumption spending had slowed to a 4 per gain was largely offset by the recession declines. cent annual rate. Since the saving rate generally Thus, by the end of 1976 real disposable income fell in 1976, the slowdown in the pace of was 3.5 per cent above its pre-recession peak, consumer spending seems attributable mainly to compared with about 9 per cent during compa- the reduced growth rate of disposable income. rable periods of other recoveries. Much of the increase in consumer spending Much of the growth in disposable income in the early part of 1976 was for autos, as sales during the first year of the recovery reflected of both domestic and foreign cars surged. Auto the combined effects of an expansion in em- sales were bolstered not only by gains in real ployment and of the Tax Reduction Act of 1975. income but also by replacement demand, which However, in the absence of large increases in had been deferred during the 1975 recession. durable goods production and accompanying The strength in consumer spending during early significant gains in employment, growth in real 1976 did not extend to purchases of other disincome slowed markedly during the last three cretionary types of goods—such as furniture, quarters of 1976—to about a 3 per cent annual appliances, clothing, and shoes. Consumer rate. Growth of real disposable income during spending for nondurable goods in real terms was this period was also retarded by a decline in relatively strong in the first quarter but weakfarm income, a gradual increase in average tax ened noticeably in the second and third quarrates as inflation pushed individuals into higher ters. During those two quarters, households tax brackets, and the still relatively high rate continued adding to their stocks of durable of consumer price increases. goods, but at a very slow pace. Growth in Spending, saving, and income Billions of 1972 dollars Peak=100 REAL PERSONAL CONSUMPTION REAL DISPOSABLE PERSONAL INCOME EXPENDITURES 80 110 Median of ^ five previous x cycles ^^ 75 \ •— 100 Per cent SAVING RATE Current cycle 9 Peak-. 1973Q4 £ 11111 j , t 4 6 8 10 12 1973 1974 1975 1976 Quarter relative to peak Dept. of Commerce data, seasonally adjusted at annual rates. Real is in terms of 1972 dollars. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-4 Federal Reserve Bulletin • January 1977 Auto sales through larger and more pronounced cyclical swings, continued to be worked off throughout Millions of units 1975 and into 1976. Total inventory investment on a national income accounts basis turned from decumulation in the fourth quarter of 1975 to substantial accumulation in the first quarter of 1976—a swing of more than $22 billion—as the business outlook continued to improve at the turn of the year. The first-quarter accumulation was probably greater than intended, however—particularly for nondurable goods. In view of the fact Ward's "Automotive Reports" data. Seasonal adjustment by F.R. Domestic-type autos include U.S. sales of cars produced that consumer demand slackened in the spring, in Canada. business firms struggled during the remainder consumer spending for services, on the other of the year to keep inventories under control. hand, was relatively well maintained throughout As a result, total inventory investment was 1976. maintained at a fairly constant rate during the Total auto sales in the autumn fell to about second and third quarters of the year. a 93A-million-unit annual rate, compared with sales rates of more than 10 million units (annual Nonfarm business inventories rate) earlier in the year. In part, sales were held down by the low level of dealer inventories due Change, billions of dollars to a major auto strike, as well as by the inability of the industry to anticipate fully the shift in consumer preferences toward intermediate- and full-size cars. During the third and fourth quar- irrent H « J i i i kf ters dealers had less than a 20-day supply of | | - | || | | several of the more popular domestic models. Sales of imported cars, on the other hand, improved in the fall to a 1.9-million-unit annual rate, due partly to price concessions given to I Real work down an enormous, 109-day supply at the beginning of August. At the end of the year it appeared that consumer spending was coming out of the dol- . 1 : • V • 1 1 drums. Sales gains were large particularly for 1973 1974 1975 1976 most types of nondurable goods. Sales of do- Dept. of Commerce data, seasonally adjusted at annual rates. Real is in terms of 1972 dollars. mestic-type autos were also on an uptrend, rising to a 9.3-million-unit annual rate in the last month of the year. The shift toward accumulation in the first quarter of 1976 was concentrated in nondurable goods, and for these goods the ratio of stocks to sales in constant dollars rose during the INVENTORY INVESTMENT quarter. Part of this build-up may have been The heavy overhang of inventory stocks that had desired, since sales of nondurable goods had been accumulated during 1973 and 1974 led to been substantial around Christmas 1975 and a record rate of run-off in the first half of 1975. stocks had been run down. Nevertheless, some By the second half, however, inventory invest- of the accumulation was apparently undesired ment of nondurable goods turned positive. as production adjustments, particularly in the Stocks of durable goods, which typically go nondurable materials industries, got under way Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1976 5 before final sales of nondurable goods had begun Real business fixed investment to weaken. When consumer buying slumped in Trough^100 the second quarter, downward adjustments in production plans became more widespread, and the output of nondurable goods remained virtually unchanged from March through September. Stocks of durable goods continued to be run off in the first quarter of 1976—but at a much reduced rate. The slackening of economic activity in the late spring led to increased uncertainty about sales and to greater caution regarding desired inventories—especially for durable materials such as steel. This caused cutbacks 4 2 -T + 2 4 6 8 in the rate of orders and production. But in spite Quarter relative to trough of these production adjustments, the modest rate Dept. of Commerce data, seasonally adjusted at annual rates, of consumer spending for autos and other types in terms of 1972 dollars. of durable goods, together with the sluggishness of business fixed capital outlays, resulted in a the year-end real capital spending was still about build-up of durable stocks relative to sales in 12 per cent below the peak reached in the first late summer and fall. quarter of 1974. Special developments affected inventories in This has been the weakest recovery in busiseveral industries. Tire stocks were run down ness fixed investment during the postwar era. during the rubber strike and rebuilt thereafter. In the seven quarters following the trough, real Auto inventories were very unbalanced—with business fixed investment increased only 3 per too many small cars and too few of the popular, cent, compared with a median of 14 per cent larger models. These imbalances, however, in previous postwar recoveries. Expenditures for were being corrected toward the end of the year. producers' durable equipment, which rose only Oil inventories surged in the summer and fall about 8 per cent in real terms in the last four months in anticipation of forthcoming price in- quarters, have been particularly slow to recover, creases by the Organization of Petroleum Ex- despite substantial gains in communications porting Countries. equipment and business purchases of trucks and In the fourth quarter of 1976 business made autos. Expenditures for nonresidential structures progress in cleaning up undesired stocks at both were also weak—rising only 5 per cent in real the manufacturing and the trade levels. By the terms in the last four quarters—but these outlays end of the year, inventories were coming into have usually been slower to recover than exbetter balance with sales. Although a working penditures for equipment. The major source of down of excess inventories still appeared to be strength in nonresidential structures came from in process in some categories of durable goods, public utilities, while the sector that usually the inventory adjustment seemed to be nearing supports recovery—commercial and industrial completion, thereby removing a dampening building—continued weak through the end of factor on industrial production. 1976. Some of the underlying determinants for capital spending continued to be quite favorable throughout 1976. Corporate profits increased BUSINESS FIXED INVESTMENT substantially, long-term interest rates remained Real business fixed investment did not bottom well below their level at the trough of the out until the third quarter of 1975—half a year recession, and corporations made additional after the trough in real GNP. These expenditures progress in restructuring their balance sheets to increased about 7 per cent during 1976, but by rebuild liquidity and reduce risk exposure. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-6 Federal Reserve Bulletin • January 1977 Whereas these developments would normally the annual rate of private housing starts—at have given a substantial boost to capital spend- over 1.8 million units—was about 825,000 ing, the caution created by the turbulent eco- units above the early 1975 trough. In addition, nomic environment of the past several years— the rate of factory shipments of new mobile along with continued slack capacity and the homes, while still well below earlier peaks, was inability of the recovery to reach maturity—left somewhat above the 1975 level. businesses unusually reluctant to make commit- The rise in total residential construction acments for new capital spending. tivity last year was facilitated by the improving Following the pattern of recent years, busi- financial situation of thrift institutions—the ness spending for plant and equipment was dominant mortgage lenders—and by strong considerably stronger in the manufacturing than household demands for shelter. Lenders were in the nonmanufacturing sectors. Producers of able to provide a large supply of mortgage credit nondurable goods and firms producing machin- while still improving their liquidity positions. ery, motor vehicles, and stone, clay, and glass Moreover, the supply of funds was sufficient to showed the largest increases. Excluding the meet a near-record volume of mortgage debt manufacturing sector, the biggest gains were formation at slightly declining interest rates in concentrated in public utilities, communi- the primary mortgage market. cations, and transportation industries such as pipelines, trucking, and shipping. Privately owned housing starts At the end of the year most indicators of Ratio scale, millions of units capital spending were foreshadowing advances that were moderate for a recovery period. The Commerce Department's December survey of plant and equipment spending showed business projecting an increase of 11 per cent for calendar year 1977—up from the apparent IV2 per cent gain of 1976. Other indicators suggested that the pause in the pace of economic expansion would lead to relatively slow capital spending growth in the first part of 1977. New capital appropriations of large manufacturing corpora- Dept. of Commerce data, seasonally adjusted at annual rates. tions fell significantly in the third quarter of 1976. In addition new orders for capital equip- During much of 1976 the uptrend in housing ment, which strengthened throughout much of construction activity was concentrated in the 1976, showed little growth in the fourth quarter. single-family sector. Single-family starts, at 1.3 Nevertheless, the outlook for business fixed million units by year-end, approached the peak investment could improve materially, if sus- rates of 1972 and early 1973, when production tained gains in final demands succeed in remov- had been bolstered by special Federal subsidy ing lingering doubts about the underlying programs designed to stimulate homeowner ship. strength of the recovery. Single-family housing activity accounted . for nearly 60 per cent of the growth in starts over the four quarters of the year. Multifamily starts remained quite low in RESIDENTIAL CONSTRUCTION 1976, even when compared with the years im- The steady rise in outlays for private residential mediately before 1971 when the boom in conconstruction has been a significant source of struction of such units began. Significant insupport for the current economic recovery. creases were registered in each of the last three These outlays increased by more than one-fifth quarters of the year, however, and by the final in real terms during 1976. By the fourth quarter quarter multifamily starts were at about a 525,- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1976 7 OOO-unit annual rate—the highest quarterly Federal purchases and expenditures average in 7}/i years. Despite evidence of in- Change, billions of dollars creased demands for rental space during the year, investment in this sector has been hampered by a number of factors affecting builders' profitability and investors' risks—such as high costs for construction, substantially increased operating costs on completed units, and actual or threatened rent controls in some areas. Moreover, the market for multifamily condominiums was still affected by overbuilding during the early 1970's and by consumer resistance to high prices for these housing units. As the year ended, savings flows to thrift institutions were still very large, mortgage loan commitments outstanding were still rising, and some easing in mortgage interest rates was evident. These conditions, along with continued correction of problems in the multifamily sector, 1973 1974 1975 1976 suggest that residential construction outlays are Dept. of Commerce national income and product data, seasonlikely to supply considerable additional stimulus ally adjusted at annual rates. to the over-all economic expansion in 1977. viduals who had been receiving income security payments return to work. In the first 9 months of the year, however, Federal spending in a THE FEDERAL SECTOR variety of other programs—such as defense The Federal deficit—on a national income ac- purchases, grants to State and local governcounts basis—declined by roughly $13 billion ments, and interest payments—fell far short of in calendar year 1976 to a level of $58 billion, the levels expected by both the administration as receipts rebounded from the depressed 1975 in its January budget and by the Congress in level and the expansion of Federal expenditures its second concurrent resolution for fiscal year slowed markedly during the first half of the year. 1976. In view of the slowing of economic On a full-employment basis, the deficit fell by growth, these spending shortfalls received about $8 billion. widespread notice, even though such shortfalls Between 1975 and 1976, total Federal re- of spending have often occurred in the past. ceipts increased by more than $40 billion, or Federal Government purchases of goods and 15 per cent. Corporate profits taxes contributed services—which enter directly into GNP—rose substantially to the gain—increasing by about by about 6.5 per cent over the four quarters of 30 per cent. Personal tax receipts, responding 1976, following an 11.5 per cent increase in to the recovery, grew 15 per cent from 1975 1975. This slowing in the growth of purchases to 1976. Social security taxes rose 12 per cent, was equally distributed between defense and reflecting an increase in the wage base from nondefense expenditures. Most of the slowing in $14,100 to $15,300 as well as gains in employ- purchases was in outlays other than compensament and payrolls. Indirect business taxes— tion, although the growth in payroll costs also mainly liquor and tobacco taxes and customs was more modest than in the previous year. Miliduties—remained essentially unchanged from tary employment declined slightly, while civilian their 1975 levels. employment was little changed. The growth of Federal spending typically Grants to State and local governments showed slows during economic recovery as many indi- very little increase in the first half of 1976 as Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-8 Federal Reserve Bulletin • January 1977 Federal aid for highways and education regis- year. The modest advance in nominal spending tered declines. These grants, however, did re- probably reflected an attempt by many units to bound in the latter half of 1976, and the growth rebuild fiscal positions that had been weakened in grants was further bolstered late in the year over the last several years; also, long-run by the payment of countercyclical revenue- demographic factors—such as the decline in sharing funds, as legislated by the Congress in school-age population—helped to curtail spendthe Local Public Works Employment Act of ing. 1976. As a result of the slowdown in the growth of State and local government spending in nominal terms, real purchases of goods and STATE AND LOCAL services in this sector were little changed over the four quarters of 1976, as compared with a GOVERNMENTS 4 per cent rise in 1975; this was by far the Growth in spending by State and local govern- weakest performance for these purchases since ments was very moderate in 1976 and was 1959. Investment in structures in real terms fell accompanied by stronger revenue growth. As by almost 14 per cent during 1976, with much a result, the "operational" account—that is, the of the cutback accounted for by highways and balance excluding net savings by social insur- school buildings. Real spending for capital ance funds—showed a surplus of about $1 bil- goods by State and local governments is curlion in 1976, an improvement from the deficit rently only about 70 per cent of the peak levels of $5 billion in 1975. of the late 1960's. Revenues excluding Federal grants rose about The largest element in the spending slow- 11 per cent over the four quarters of 1976, down, however, has been a reduced rate of compared with 9V* per cent in the preceding hiring. Over the past decades, State and local four quarters. This favorable trend was offset governments have been a strong source of dein part, however, by a much slower growth in mand for labor. But preliminary indicators suggrants-in-aid from the Federal Government, gest that only about 200,000 new jobs were despite the rebound in such grants during the created in this sector over the four quarters of second half. 1976—about half the average annual gain. Over-all expenditures by State and local gov- There has been some acceleration in wage ernments rose by only 6.5 per cent over the rate increases for public employees, which partly offset the impact on outlays of the reduced pace of employment gains in 1976. Over the State and local government, real purchases four quarters of the year compensation per worker in this sector rose in the 7 per cent range, Per cent compared with 6.5 per cent in 1975. This acceleration probably reflects an attempt by public employees to compensate for the shortfall in their wage increases between 1972 and 1975 relative to those of private sector employees. NET EXPORTS U.S. net exports of goods and services on a national income accounts basis averaged $6.9 billion in 1976, down sharply from $20.5 Dept. of Commerce data, seasonally adjusted at annual rates. billion recorded in 1975. The decline partly Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1976 9 reflected growth in merchandise imports—stim- 1975—increasing more than three times as fast ulated by the economic recovery in the United as real GNP and pushing the bill for imported States—and the dampening effect on U.S. ex- fuel to $37 billion. Roughly 40 per cent of the ports of the sluggish recovery in much of the total petroleum consumed in this country is industrial world. Merchandise exports rose only imported, and all of the swing in petroleum moderately in both volume and value terms after consumption during the recession and recovery the fourth quarter of 1975, contributing little to occurred in the imported segment. Fuel imports the strength of over-all demand. At the same are particularly sensitive to recovery in domestic time, the strong rise in imports, and especially activity, but they were further stimulated in a major increase in payments for imported fuels 1976 by a continuation of the decline in domesin the summer months, also had a depressing tic oil production, and beginning in the third effect on aggregate activity. quarter, by stockbuilding in anticipation of a Imports of merchandise into the United States possible price increase by the Organization of grew rapidly during 1976, with increased de- Petroleum Exporting Countries at year-end. mands for both fuel and nonfuel goods. Nonfuel Growth in U.S. exports in 1976—led by imports rose by more than 20 per cent from their exports of capital goods—was constrained by recession-depressed levels of 1975. In the first the sluggishness in the recovery overseas. Agriquarter the expansion of these imports centered cultural exports made a strong contribution to in industrial supplies and materials and in auto- the over-all export performance, with the volmobiles from Japan, both of which were asso- ume up 16 per cent over the four quarters of ciated with rebuilding of stocks. A second burst 1976. of nonfuel import growth occurred in the third Net services and military transactions (as dequarter; all major end-use categories except fined in the national income accounts) added automobiles contributed to the expansion of over $3 billion more to net exports in 1976, imports. compared with 1975. The increase in the surplus The volume of petroleum imported in 1976 on these transactions continues the pattern of rose more than 20 per cent from the level in the past several years: rising income from U.S. investments abroad, declining overseas military expenditures by the United States, and rising US. foreign transactions sales of military equipment to foreign governments. Billions of dollars THE LABOR MARKET Expor |l[|lljpgl Conditions in the labor market responded favorably to the increase in output during the first part of 1976. But when the pace of aggregate ts vrtlHlr Impor activity moderated, employment gains slowed and the unemployment rate rose. During the first - A part of the year, employment grew rapidly and the unemployment rate continued to fall from Surplus a recession high of 8.9 per cent in May 1975 to 7.3 per cent in May 1976. However, sales III. and production flattened out over the summer, _ n 1 1 .1 mi m 11I J I II ID i m m 1973 1974 1975 1976 and, as a result, employment gains dwindled, the workweek was cut back in several indus- Dept. of Commerce data, seasonally adjusted at annual rates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-10 Federal Reserve Bulletin • January 1977 Employment and unemployment Change from previous quarter, millions of persons Change from previous quarter, millions of persons PAYROLL EMPLOYMENT LABOR FORCE EMPLOYMENT Civilian labor force n; Total employment Per cent • ^ • • • • • • • • • • n H H H Hi 1973 1974 1975 1976 1973 1974 1975 1976 Dept. of Labor data, seasonally adjusted at annual rates. tries, and there was a rise in layoffs and in the cent—compared with a pre-recession rate of unemployment rate. slightly more than 3 per cent. During the first 4 months of the year, more than 1.2 million additional jobs were added to industry payrolls. But as employment growth WAGES, PRODUCTIVITY, slackened, monthly increases in nonfarm payroll AND LABOR COSTS employment were cut to a third of the rate earlier in the year. The biggest slowdown was in man- Wage rate increases slowed substantially in ufacturing, where employment (when adjusted 1976 from the exceptionally rapid rate of the for strike activity) grew by only 65,000 between preceding 2 years, despite a heavy collective April and December, compared with a rise of bargaining schedule that included contract setmore than 470,000 during the first 4 months of tlements in the trucking, rubber, electrical the year. Substantial slowing in employment equipment, auto, and agricultural implement growth also occurred in other sectors; for ex- industries. Over the four quarters of 1976 the ample, in construction and State and local gov- average hourly earnings index—the broadest ernments . measure of wage rates—rose 6.7 per cent, The total unemployment rate by the end of compared with 8.2 per cent in the preceding the year was 7.9 per cent—only fractionally less year. The slowdown was widespread across than a year earlier. This compares with a rate major industries. After adjusting for the effects of less than 5 per cent that had prevailed in of price inflation, the hourly earnings index 1973 before the recession began. The reduction grew about 1.6 per cent during 1976. in joblessness during the early part of the re- The growth in nonfarm business productivity covery was concentrated among various groups remained above its long-term trend rate of experienced workers, and these workers also throughout 1976. Productivity grew at annual encountered the greatest relative increase in rates of 5.8 per cent and 5.4 per cent in the unemployment because of the pause in aggre- first and second quarters, respectively, and then gate activity. Nearly half of the increase in dropped to a 2.9 per cent annual rate in the unemployment during the last 7 months of the third quarter as gains in output slowed. Producyear was due to job loss, and in December the tivity growth generally behaves in a procyclical unemployment rate for adult men was 6.2 per manner, and the above-average growth in 1976 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1976 11 is a reflection of the recovery of economic above its December 1975 level, in contrast to activity from the recent recession. Even with a 6.5 per cent increase during the preceding this favorable experience, however, the produc- year. Early in the year moderation of the contivity index has not made up for earlier slow sumer price rise also stemmed from declines in growth and thus remains significantly below its prices of petroleum products. Excluding food long-run trend line. and energy items, however, the consumer price Since the latter part of the 1960's, produc- index rose by about 6Vi per cent in 1976—not tivity growth has slowed considerably from its much slower than the increase of 6.9 per cent rate earlier in the postwar period. This reflects, in 1975. in part, the continued change in the composition of output toward the service-producing sectors, where average productivity levels are Wages and consumer prices lower; the diversion of labor and capital resources toward the production of a better envi- Percentage change from previous year ronment and of better working conditions—outputs that are not measured in the GNP accounts; and a slowing in the growth of the ratio of the capital stock to labor inputs. Also, the quadrupling of crude oil prices in 1973 and 1974 apparently forced some producers to reduce the use of certain high-productivity, highenergy technologies and rendered some of the existing, energy-inefficient capital stock obsolete. Hourly compensation—which includes fringe benefits and employer contributions to social Dept. of Labor data, seasonally adjusted. security—rose by about per cent during 1976, about as much as in the preceding year. The favorable pattern of food prices in 1976 Part of the increase reflected a rise in social was attributable to abundant supplies of most security costs in the first quarter. Despite this farm goods, particularly in the livestock seccontinuation of relatively large increases in tor—in large part a response to excellent feed hourly compensation, the sizable increase in crops during the previous year. Near the end productivity over the year acted to hold down of the year, however, cattle prices had started the rise in unit labor costs. During 1976 unit to rise, as livestock operations became unprofitlabor costs rose by about 3J/2 per cent, close able for some producers and as slaughter of to the average increase in the preceding year, breeding herds began to taper off. but down significantly from the 13 per cent rate Prices of petroleum products declined early in 1974. in 1976, as a result of the elimination of the $2 import fee on crude oil and the rollback of average domestic crude oil prices under the Energy Conservation and Policy Act. By spring, PRICES however, energy prices resumed their rapid rise Moderation of the rate of inflation in 1976 in under the impact of higher demand as well as large part reflected special factors. Consumer partial deregulation. From April to December, prices rose by about 5 per cent over the four consumer prices of energy items rose at about quarters of 1976, compared with more than 7 a 15 per cent annual rate, in contrast to a 5 per cent during 1975. The food component of per cent rate for nonenergy items. For the year the index at year-end 1976 was only slightly as a whole, however, energy price increases Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-14 Federal Reserve Bulletin • January 1977 Prices Ratio scale, January 1973=100 Dept. of Labor data, seasonally adjusted. were larger only for natural gas, up about 18 may continue to dominate price trends in the per cent at retail because of changes in regulated first half of 1977. Food supplies in general rates. should continue to be ample, but the outlook Wholesale prices of industrial commodi- for food prices may be somewhat less favorable ties—both materials and finished goods—rose than in 1976. For energy, the impact of expected slowly during most of the first half but picked further increases in prices of imported crude oil up later in the year. While some of the acceler- and natural gas should continue to put upward ation was in the energy grouping, there were pressure on the general price level. Meanwhile, also large adjustments in basic metals, motor the underlying rate of inflation remains quite vehicles, and nonautomotive machinery and high by historical standards, and recent data equipment; lumber and plywood prices also rose suggest continued upward pressures on indusrapidly during most of the year. trial prices despite substantial underutilization Developments in the food and energy sectors of industrial capacity. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

15 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON NOVEMBER 16, 1976 Domestic Policy Directive The information reviewed at this meeting suggested that real output of goods and services—which had increased at an annual rate of 4.0 per cent in the third quarter, according to preliminary estimates of the Commerce Department—might be expanding at a somewhat slower pace in the current quarter. The rise in average prices—as measured by the fixed-weighted price index for gross domestic business product—appeared to be somewhat faster than in the third quarter, when it had slowed to an annual rate of 4.4 per cent. A staff analysis suggested that in the fourth quarter a significant reduction in the over-all rate of inventory accumulation might be taking place in response to the increases in inventory/sales ratios that had developed in many lines of manufacturing and trade over the past several months. It appeared that final purchases of goods and services in real terms were expanding at about the third-quarter rate and, with production schedules curtailed, that inventory positions would be brought into better balance. Staff projections suggested, therefore, that growth in real GNP would pick up somewhat in the first quarter of 1977 and that it would be sustained at about the first-quarter rate well into the new year. On balance, however, the projected rates of growth were slightly less than those of a month earlier. The projected expansion in business fixed investment was scaled down somewhat further, and the anticipated growth in personal consumption expenditures also was reduced a little. On the other hand, the rise in residential construction was now expected to be somewhat stronger. The staff projections continued to suggest that both Federal and State and local government purchases of goods and services would increase at a moderate pace in the quarters immediately ahead. With respect to the Federal Government, on October 27 the Treasury and the Office of Management and Budget had announced that spending on a unified budget basis had fallen $11.4 billion Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-16 Federal Reserve Bulletin • January 1977 short of the estimates of last January for the period encompassing the fiscal year ending June 1976 and the third quarter of calendar year 1976—the "transition quarter" resulting from the change from a fiscal year running from July through June to one running from October through September. In the administration's Mid-Session Review of the 1977 Budget issued in July, it had been assumed that spending in the transition quarter would be augmented by a shift in outlays from fiscal year 1976, making up for the shortfall. However, the assumed shift did not occur. The staff projections for over-all Federal outlays and for growth in real output reflected a judgment—based on an analysis of the types of Federal outlays that had fallen short of earlier expectations—that the shortfall would have only a relatively small carryover effect in the fiscal year beginning October 1976. No allowance was made in the projections for new fiscal policy initiatives. Retail sales were now estimated to have declined substantially in September. The advance report suggested that sales had increased little in October and that they were no higher than the monthly average in the third quarter. However, sales of new automobiles were adversely affected by a strike at the plants of a major producer; in October auto sales fell to an annual rate of 9.5 million units from 10 million in September. Sales at apparel and general merchandise stores rose sharply in October after having declined in the previous month. The index of industrial production—which for September had been revised downward to show a small decrease—declined somewhat further in October to a level that was 0.5 per cent below the average for the third quarter. A significant part of the decline in output over the 2 months was accounted for by strikes. In October, however, decreases in output were widespread among industries, including both those making final products and those making materials. After adjustment for strikes, total payroll employment in nonfarm establishments rose modestly further in October. In manufacturing, however, employment declined even after adjustment for strikes. Since July, total employment, the civilian labor force, and unemployment—as measured by the household survey—had changed little. The rate of unemployment was 7.9 per cent in October, compared with 7.8 per cent in September. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 17 Private housing starts were reported to have declined somewhat in October from an advanced level; indeed, the figure for September was revised to show an even larger increase than had been indicated a month earlier. Thus, the October level of starts, at an annual rate of almost 1.8 million units, was considerably above the third-quarter average. In September, moreover, the dollar volume of mortgage commitments outstanding at savings and loan associations had continued to advance, reaching a new record. New orders for nondefense capital goods—which had declined in August for the first time in 1976—advanced in September to a level that, in real terms, was about 15 per cent higher than in December 1975. Unfilled orders continued to change little and remained at a level well below that at the end of 1975. Construction contracts for commercial and industrial buildings, measured in terms of floor space, dropped in September after having edged down in both July and August. Total contracts in the third quarter, while down from the preceding quarter, were still well above those of the first quarter. Private surveys of business plans for 1977 suggested that expenditures for plant and equipment would be significantly higher than in 1976, even after allowance for the average rise in prices of capital goods anticipated by the survey respondents. The index of average hourly earnings for private nonfarm production workers advanced at an annual rate of 7 per cent in October, about the same as from the second to the third quarter; the rise, while slightly higher than in the first two quarters of 1976, remained somewhat below the rapid rate of increase during 1975. In the third quarter of 1976 productivity in the private business sector of the economy continued to improve at a good pace, and the annual rate of increase in labor costs per unit of output was 3.8 per cent—the same as in the preceding quarter. The acceleration of the rise in average wholesale prices of industrial commodities that had begun in June—after 5 months at a reduced rate of increase—continued in October, when the index rose 1 per cent. Increases were largest for fuels and power; for transportation equipment—reflecting prices set on new models of automobiles and trucks; and for lumber and wood products. The wholesale price index for all commodities rose less rapidly in October than in September, however, because of a decline in average prices of farm products and foods. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-18 Federal Reserve Bulletin • January 1977 The consumer price index rose at an annual rate of about 5 per cent in September, compared with an average rate of 6 per cent in the months of April through August. Average retail prices of foods were stable in September, and average prices of other commodities and of services increased a little less than in the previous month. The average value of the dollar against leading foreign currencies remained steady over the 4 weeks between the October and November meetings of the Committee. The dollar declined slightly against the German mark and associated currencies in the European "snake" arrangement, but it rose against the pound sterling and the Italian lira. On October 27 Mexico again allowed the peso to float downward against the dollar; after a depreciation of about 20 per cent, the Bank of Mexico stabilized the peso at a rate 50 per cent below the level that had been maintained for 22 years prior to the beginning of September. The U.S. foreign trade deficit, which had diminished in August, widened again in September as imports expanded while exports changed little. From the second to the third quarter the rise in imports was substantial, due to especially large increases in fuels, other industrial supplies, and consumer goods. The increase in exports was much less, and the deficit in the third quarter was about double the average for the first two quarters of 1976. In October total credit at U.S. commercial banks showed the largest monthly rise since mid-1974, reflecting a sizable increase in loans. Expansion in business loans was sharp—substantially exceeding a modest contraction in outstanding commercial paper of nonfinancial businesses. The narrowly defined money stock (M^, after changing little in September, was estimated to have expanded at a 14% per cent annual rate in October. However, data for early November suggested that growth in that month would be much slower. Over the 12 months ending in October, M grew at a rate of 5.7 per x cent. The October resurgence of growth in M was reflected in an x acceleration of expansion in the broader monetary aggregates, M 2 and M . Inflows of the types of time and savings deposits included 3 in the broader aggregates continued strong, as yields on competing market securities remained below the rates offered on such deposits. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 19 Over the 12 months ending in October, M and M grew at rates 2 3 of 10.7 and 12.6 per cent, respectively. System open market operations since the October meeting had been guided by the Committee's decision to seek bank reserve and money market conditions consistent with moderate growth in monetary aggregates over the period ahead. Over the inter-meeting period, the Federal funds rate had remained close to 5 per cent. On October 21, 2 days after the October meeting, incoming data suggested that over the October-November period rates of growth in both M and M would be at about the upper limits of the ranges x 2 specified by the Committee. Therefore, it appeared likely that any reduction in the Federal funds rate in that week—pursuant to the Committee's consensus at the October meeting—would have to be quickly reversed. In those circumstances the Committee concurred in Chairman Burns' recommendation of October 21 that the Manager be instructed to continue to aim during that week for a Federal funds rate at about the prevailing level of 5 per cent. Data becoming available during the following week continued to suggest unexpected strength in growth of the monetary aggregates. In response to an inquiry from the Manager concerning the appropriate interpretation of the Committee's instructions, Chairman Burns noted that at the meeting held on October 19 the Committee had agreed upon a policy course that contemplated a slight easing of money market conditions, and that the objective for the weekly-average Federal funds rate would have been reduced to about 478 per cent had there not been indications of surprising strength in the monetary aggregates. Accordingly, the Chairman advised that in his judgment any significant increase in the Federal funds rate at that time from the prevailing level of 5 per cent would be inconsistent with the Committee's intent. No member of the Committee expressed the view that a rise in the Federal funds rate would be appropriate. Market interest rates fluctuated in a narrow range during the inter-meeting period. On balance, most rates edged higher, as strength in the published weekly data for the monetary aggregates apparently dispelled market expectations that the early October decrease of VA of a percentage point in the Federal funds rate would be followed by a further decline. However, the prime rate charged by commercial banks—which generally responds with a lag to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-20 Federal Reserve Bulletin • January 1977 changes in market rates—was reduced lA of a percentage point to 6V2 per cent. Corporate financing in markets for longer-term bonds expanded substantially in October, reaching the largest volume since June. Utilities stepped up the pace of their financing; finance companies were again active issuers; and several large industrial firms added to the over-all supply of new securities. In addition, takedowns of privately placed obligations of corporations apparently continued at a record pace. Around mid-October underwriters of publicly offered corporate bonds encountered buyer resistance on several aggressively priced new issues, and a number of syndicates with sizable unsold balances were forced to terminate restrictions on the prices at which they would sell the issues. By the month-end, however, after new issues began to be priced to provide somewhat higher yields and most of the expanded monthly volume of new offerings had been placed, the tone of the bond market improved. In markets for State and local government bonds, the volume of new issues was also large in October. Although yields in these markets backed up around midmonth, along with those in other markets, spreads between higher- and lower-rated municipal issues narrowed somewhat. Large purchases of higher-yielding, longerterm issues by property-liability insurance companies, commercial banks, and newly authorized mutual funds of municipal bonds contributed to the narrowing of risk premiums. The U.S. Treasury was a sizable borrower in the period between the October and November meetings of the Committee. It raised $1.3 billion of new money through the sale of 2-year notes in late October and $2.5 billion in conjunction with its November refinancing. In the refunding the Treasury auctioned $3.3 billion of 3-year notes at an average rate of 6.36 per cent; $3.0 billion of 7-year notes at an average rate of 7.02 per cent; and $1.0 billion of reopened 23lA-year bonds at an average rate of 7.9 per cent. Activity in the mortgage market appeared to have remained strong in October. Acquisitions of mortgages by savings and loan associations continued at a rapid pace, and the volume of new issues of GNMA-guaranteed securities was large. Between the October and November meetings of the Committee, average interest rates on new commitments for long-term conventional home mort- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 21 gages at savings and loan associations had moved down 10 basis points. Credit demands for the remainder of the year were expected to be generally moderate both at banks and in the securities markets. Corporations appeared to be scheduling fewer new bond issues than they had in the early part of the year. It was not clear whether this reflected reduced over-all financing requirements, or a slackening of efforts to restructure balance sheets, or simply a change in borrowers' expectations with regard to the level of interest rates in the future. The U.S. Treasury's needs for new money during the rest of the year appeared to have been fully discounted by the market. With respect to State and local government issues, market participants were anticipating a continued sizable volume of longer-term debt offerings, as many issuers were taking the opportunity to fund short-term debt and to reactivate earlier plans for long-term borrowing. Demands for such securities, however, appeared to be generally strong. In their discussion of the economic situation, members of the Committee were in agreement that the sluggishness or "pause" in the growth of real output was continuing. As at the mid-October meeting, no member suggested that a recession was likely. Some members noted elements of strength in the current situation that gave promise of near-term revival in the pace of expansion, and some indicated a belief that growth in economic activity in the quarters just ahead would exceed the modest rates suggested by the staff projections. However, some members expressed the view that prospects had deteriorated further over the past month, or at least that uncertainties about the outlook had increased. It was also noted that the economy might be subjected to another increase in the price of imported oil. Concern was again expressed that growth in the near term would be inadequate to make much if any progress in reducing the unemployment rate. Inflation also continued to be a source of concern, in part because of its potentially adverse effect on business outlays for fixed capital and on consumer outlays. Several reasons were given for thinking that the outlook for growth in economic activity had weakened during the past month. On the basis of estimated retail sales figures through October, it appeared that consumer purchases had been inadequate to prevent Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-22 Federal Reserve Bulletin • January 1977 inventories from becoming excessive in a number of industries. While there were signs that consumer buying had picked up in recent weeks, there was a possibility that the improvement represented earlier-than-usual Christmas shopping—perhaps spurred by early promotions of such goods—and that it would be followed by disappointing figures later in the season. In any case, it was suggested, the disappointing performance of sales and the accompanying build-up of inventories now had lasted long enough to have secondary effects: In the past few months output in some industries had been reduced and real nonfarm personal income had not grown much. In these circumstances, expansion in capital spending might lag behind the pace indicated by surveys of business spending plans or might actually lose momentum altogether as businessmen awaited more positive signs of strength in the economy. The state of confidence—as reflected by the decline in stock prices—was regarded as a source of concern. It was noted that, in part because of the shortfall in Federal outlays in recent quarters, the Federal budget on the highemployment basis had shifted from deficit to surplus and thus had been exerting a restrictive effect on the economy at a relatively early stage of the current business expansion. However, it was suggested that the likelihood of a tax reduction now had to be taken into account in assessing the outlook, although any reduction probably would not actually come until next spring. It was suggested in the discussion that during the next few months the attitudes and decisions of consumers and businessmen would be influenced in a significant way by their assessments of the economic policies of the new administration. Some businessmen were reported to be concerned that steps taken to stimulate economic expansion might soon be followed by imposition of some form of price and wage controls. The likelihood of an uptrend in Federal spending, whether or not a significant part of the recent shortfall was made up, was one of several reasons cited for expecting that before long growth in over-all economic activity would accelerate. In addition, particular attention was called to the good rise in the number of housing starts and to the continuing strength in new orders for nondefense capital goods. Members reported, moreover, that retail sales in some areas were doing well and that since mid-October the volume Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 23 of freight being moved had risen after a slow period. And it was suggested that as the new administration was formed and provided additional information as to how it planned to deal with particular economic problems, uncertainties would diminish and businessmen and consumers would become more optimistic about the future. At its telephone meeting on November 8 the Committee had agreed that from the third quarter of 1976 to the third quarter of 1977, average rates of growth in the monetary aggregates within the following ranges appeared to be consistent with broad economic aims: Mi, 4% to 6V2 per cent; M , IV2 to 10 per cent; and M , 2 3 9 to 11V2 per cent. The associated range for growth in the bank credit proxy was 5 to 8 per cent. It was agreed that the longer-term ranges, as well as the particular aggregates for which such ranges were specified, would be subject to review and modification at subsequent meetings. It also was understood that short-run factors might cause growth rates from month to month to fall outside the ranges contemplated for annual periods. In the discussion of current policy at this meeting, members of the Committee in general favored some easing in money market conditions in the period immediately ahead, so long as growth in the monetary aggregates did not appear to be unduly rapid. A number of members felt that any such easing should be slight; they suggested a near-term reduction in the weekly-average Federal funds rate to about 4% per cent from its prevailing level of about 5 per cent. In the judgment of these members liquidity positions were adequate for the needs of the economy. In particular, they noted that nonfinancial corporations were able to meet a large part of their financing needs with internally generated funds, that savings and loan associations were experiencing enormous inflows of funds, and that underlying demands for loans at commercial banks were weak. In these circumstances, it was suggested, the benefits of a move toward easier conditions would be negligible. Moreover, anything more than a slight easing so late in the business expansion could cause difficulties later on. Also, against the background of the recent rate of increase in prices and the rapid monetary growth in October, anything more than a slight easing might be interpreted as a lessening of the Federal Reserve System's concern about the continuing problem of inflation. Other members leaned toward a somewhat greater near-term Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-24 Federal Reserve Bulletin • January 1977 reduction in the Federal funds rate, to 43A per cent. Among these, some were inclined to question whether liquidity positions could be considered adequate, especially in view of the sluggish performance of the economy. While the various measures of liquidity of nonfinancial corporations had improved over the past year or so, they still appeared to be less favorable than they had been at this stage of earlier business cycles in the postwar period. In this context it was observed that nominal long-term interest rates were still high by postwar standards and that—the rate of inflation notwithstanding—current levels of interest rates tended to discourage some business managers from undertaking or enlarging commitments to make capital investments and consumers from undertaking commitments to buy houses. Modest downward pressure on short-term interest rates, it was argued, would be communicated in some degree to longer-term rates as managers of the portfolios of financial institutions lengthened the average maturities of those portfolios in an effort to maintain a satisfactory over-all return. In considering the ranges of growth rates for the monetary aggregates to be specified for the November-December period, the members took account of the indications that growth in November was likely to be relatively slow for M and relatively rapid for 1 M . For Mi, most members favored a range of 3 to 7 per cent 2 or 2% to 6% per cent. For M , most members favored a range 2 of 9% to 13% per cent or 9 to 13 per cent. A number of divergent views were expressed with respect to the range to be specified for the weekly-average Federal funds rate in the inter-meeting period. Members proposed ranges that varied in width from 4% to 5% per cent at one extreme to 43A to 5 per cent at the other, and a number suggested retention of the range of 4% to 5% per cent specified at the previous meeting. Some of those members advocating the narrower ranges favored placing greater emphasis on money market conditions in the domestic policy directive to be issued to the Federal Reserve Bank of New York than had been the case in the directive issued at the meeting a month earlier. Others, however, preferred to retain language similar to that adopted in October, which placed more emphasis on the behavior of the aggregates in guiding operations. At the conclusion of the discussion the Committee decided to seek bank reserve and money market conditions consistent with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 25 moderate growth in monetary aggregates over the period ahead. Specifically, the Committee concluded that growth in M and M x 2 over the November-December period at annual rates within ranges of 3 to 7 per cent and 9% to 13% per cent, respectively, would be appropriate. It was understood that, in assessing the behavior of the aggregates, the Manager should continue to give approximately equal weight to the behavior of M and of M . x 2 It was agreed that until the next meeting the weekly-average Federal funds rate might be expected to vary in an orderly way within a range of AVi to 5lA per cent. It was also agreed that the Manager should aim to reduce the Federal funds rate to about 4% per cent within the next week and to about 4 3A per cent within the following week—provided that growth in the monetary aggregates did not appear to be strong relative to the specified ranges— and to decide on subsequent objectives on the basis of incoming data for the monetary aggregates. 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 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 in the fourth quarter may be falling somewhat below the third-quarter rate. In October retail sales increased little following a decrease in September. Industrial production and employment in manufacturing declined, in part because of strikes. After adjustment for strikes, total payroll employment in nonfarm establishments rose somewhat further. According to household survey data, the unemployment rate edged up from 7.8 to 7.9 per cent. The wholesale price index for all commodities rose less rapidly in October than in September as average prices of farm products and foods declined; however, average prices of industrial commodities rose sharply further. The advance in the index of average wage rates over recent months has remained somewhat below the rapid rate of increase during 1975. The average value of the dollar against leading foreign currencies has remained steady in recent weeks, declining slightly against the German mark and associated European currencies but rising against the pound sterling and the lira. In September the U.S. foreign trade Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-26 Federal Reserve Bulletin • January 1977 deficit widened again, and the third-quarter deficit was about double the average of the first two quarters of 1976. Mi, which was about unchanged in September, expanded sharply in October. Growth in M and M accelerated as inflows of the 2 3 time and savings deposits included in these broader aggregates continued exceptionally strong. Interest rates have fluctuated in a narrow range in recent weeks. In light of the foregoing developments, it is the policy of the Federal Open Market Committee to foster financial conditions that will encourage continued economic expansion, while resisting inflationary pressures and contributing to a sustainable pattern of international transactions. To implement this policy, while taking account of developments in domestic and international financial markets, the Committee seeks to achieve bank reserve and money market conditions consistent with moderate growth in monetary aggregates over the period ahead. Votes for this action: Messrs. Burns, Volcker, Black, Cold well, Gardner, Jackson, Kimbrel, Lilly, Partee, Wallich, Winn, and Guffey. Votes against this action: None. Absent and not voting: Mr. Balles. (Mr. Guffey voted as alternate for Mr. Balles.) * * * * * 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

27 Law Department Statutes, regulations, interpretations, and decisions Equal Credit Opportunity (c) Penalties and liabilities. (1) Sections 706(a) and (b) of the Act provide that any creditor who The Board of Governors has issued a revised fails to comply with any requirement imposed Regulation B to implement 1976 amendments to under the Act or, pursuant to section 702(g), this the Equal Credit Opportunity Act. Part is subject to civil liability for actual and Effective March 23, 1977, Part 202 is amended punitive damages in individual or class actions. to read as follows: Pursuant to section 704 of the Act, violations of the Act or, pursuant to section 702(g), this Part Section 202.1— constitute violations of other Federal laws may Authority, Scope, Enforcement, provide further penalties. Liability for punitive Penalties and Liabilities, Interpretations damages is restricted by section 706(b) to non- (a) Authority and scope. This Part1 comprises governmental entities and is limited to $10,000 the regulations issued by the Board of Governors in individual actions and the lesser of $500,000 of the Federal Reserve System pursuant to Title or one percent of the creditor's net worth in class VII (Equal Credit Opportunity Act) of the Con- actions. Section 706(c) provides for equitable and sumer Credit Protection Act, as amended (15 declaratory relief. Section 706(d) authorizes the U.S.C. § 1601 et seq.). Except as otherwise pro- awarding of costs and reasonable attorney's fees vided herein, this Part applies to all persons who to an aggrieved applicant in a successful action. are creditors, as defined in section 202.2(1). (2) Section 706(e) relieves a creditor from civil (b) Administrative enforcement. (1) As set liability resulting from any act done or omitted forth more fully in section 704 of the Act, admin- in good faith in conformity with any rule, regulaistrative enforcement of the Act and this Part tion, or interpretation by the Board of Governors regarding certain creditors is assigned to the of the Federal Reserve System, or with any inter- Comptroller of the Currency, Board of Governors pretations or approvals issued by a duly authorized of the Federal Reserve System, Board of Directors official or employee of the Federal Reserve Sysof the Federal Deposit Insurance Corporation Fed- tem, notwithstanding that after such act or omiseral Home Loan Bank Board (acting directly or sion has occurred, such rule, regulation, interprethrough the Federal Savings and Loan Insurance tation, or approval is amended, rescinded, or Corporation), Administrator of the National Credit otherwise determined to be invalid for any reason. Union Administration, Interstate Commerce Com- (3) As provided in section 706(f), a civil action mission, Civil Aeronautics Board, Secretary of under the Act or this Part may be brought in the Agriculture, Farm Credit Administration, Securi- appropriate United States district court without ties and Exchange Commission, and Small Busi- regard to the amount in controversy or in any other ness Administration. court of competent jurisdiction within two years (2) Except to the extent that administrative en- after the date of the occurrence of the violation forcement is specifically committed to other au- or within one year after the commencement of an thorities, compliance with the requirements im- administrative enforcement proceeding or a civil posed under the Act and this Part will be enforced action brought by the Attorney General within two by the Federal Trade Commission. years after the alleged violation. (4) Sections 706(g) and (h) provide that, if the agencies responsible for administrative enforcement are unable to obtain compliance with the Act *As used herein, the words "this Part" mean Regulation or, pursuant to section 702(g), this Part, they may B, 12 CFR 202. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-28 Federal Reserve Bulletin • January 1977 refer the matter to the Attorney General. On such authority to approve particular creditors' forms in referral, or whenever the Attorney General has any manner. reason to believe that one or more creditors are (4) The type of interpretation issued will be engaged in a pattern or practice in violation of determined by the Board and the designated offithe Act or this Part, the Attorney General may cials by the following criteria: bring a civil action. (i) Official Board interpretations will be is- (d) Interpretations. (1) A request for a formal sued upon those requests that involve potentially Board interpretation or an official staff interpreta- controversial issues of general applicability dealtion of this Part must be addressed to the Director ing with substantial ambiguities in this Part and of the Division of Consumer Affairs, Board of that raise significant policy questions. Governors of the Federal Reserve System, Wash- (ii) Official staff interpretations will be issued ington, D.C. 20551. Each request for an intepre- upon those requests that, in the opinion of the tation must contain a complete statement, signed designated officials, require clarification of techniby the person making the request or a duly au- cal ambiguities in this Part or that have no signifithorized agent, of all relevant facts of the transac- cant policy implications. tion or credit arrangement relating to the request. (iii) Unofficial staff interpretations will be True copies of all pertinent documents must be issued where the protection of § 706(e) of the Act submitted with the request. The relevance of such is neither requested nor required, or where time documents must, however, be set forth in the strictures require a rapid response. request, and the documents must not merely be incorporated by reference. The request must con- Section 202.2—Definitions tain an analysis of the bearing of the facts on the and Rules of Construction issues and must specify the pertinent provisions of the statute and regulation. Within 15 business For the purposes of this Part, unless the context days of receipt of the request, a substantive re- indicates otherwise, the following definitions and sponse will be sent to the person making the rules of construction shall apply.2 request, or an acknowledgement will be sent that (a) Account means an extension of credit. When sets a reasonable time within which a substantive employed in relation to an account, the word use response will be given. refers only to open end credit. (2) Any request for reconsideration of an official (b) Act means the Equal Credit Opportunity Act staff interpretation of this Part must be addressed (Title VII of the Consumer Credit Protection Act). to the Secretary, Board of Governors of the Fed- (c) Adverse action. (1) For the purposes of eral Reserve System, Washington, D.C. 20551, notification of action taken, statement of reasons within 30 days of the publication of such interpre- for denial, and record retention, the term means: tation in the Federal Register. Each request for (i) a refusal to grant credit in substantially reconsideration must contain a statement setting the amount or on substantially the terms requested forth in full the reasons why the person making by an applicant unless the creditor offers to grant the request believes reconsideration would be ap- credit other than in substantially the amount or propriate, and must specify and discuss the appli- on substantially the terms requested by the applicability of the relevant facts, statute, and regula- cant and the applicant uses or expressly accepts tions. Within 15 business days of receipt of such the credit offered; or request for reconsideration, a response granting or (ii) a termination of an account or an unfadenying the request will be sent to the person vorable change in the terms of an account that making the request, or an acknowledgement will does not affect all or a substantial portion of a be sent that sets a reasonable time within which classification of a creditor's accounts; or such response will be given. (iii) a refusal to increase the amount of credit (3) Pursuant to section 706(e) of the Act, the available to an applicant when the applicant re- Board has designated the Director and other offi- quests an increase in accordance with procedures cials of the Division of Consumer Affairs as offi- established by the creditor for the type of credit cials "duly authorized" to issue, at their discre- involved. tion, official staff interpretations of this Part. This 2 Note that some of the definitions in this Part are not identical designation shall not be interpreted to include to those in 12 CFR 226 (Regulation Z). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 29 (2) The term does not include: (h) Consumer credit means credit extended to (i) a change in the terms of an account ex- a natural person in which the money, property, pressly agreed to by an applicant; or or service that is the subject of the transaction is (ii) any action or forbearance relating to an primarily for personal, family, or household puraccount taken in connection with inactivity, de- poses. fault, or delinquency as to that account; or (i) Contractually liable means expressly obli- (iii) a refusal to extend credit at a point of gated to repay all debts arising on an account by sale or loan in connection with the use of an reason of an agreement to that effect. account because the credit requested would exceed (j) Credit means the right granted by a creditor a previously established credit limit on the ac- to an applicant to defer payment of a debt, incur count; or debt and defer its payment, or purchase property (iv) a refusal to extend credit because appli- or services and defer payment therefor. cable law prohibits the creditor from extending the (k) Credit card means any card, plate, coupon credit requested; or book, or other single credit device existing for the (v) a refusal to extend credit because the purpose of being used from time to time upon creditor does not offer the type of credit or credit presentation to obtain money, property, or services plan requested. on credit. (d) Age refers only to natural persons and means (/) Creditor means a person who, in the ordithe number of fully-elapsed years from the date nary course of business, regularly participates in of an applicant's birth. the decision of whether or not to extend credit. (e) Applicant means any person who requests The term includes an assignee, transferee, or or who has received an extension of credit from subrogee of an original creditor who so particia creditor, and includes any person who is or may pates; but an assignee, transferee, subrogee, or be contractually liable regarding an extension of other creditor is not a creditor regarding any viocredit other than a guarantor, surety, endorser, or lation of the Act or this Part committed by the similar party. original or another creditor unless the assignee, (f) Application means an oral or written request transferee, subrogee, or other creditor knew or had for an extension of credit that is made in accor- reasonable notice of the act, policy, or practice dance with procedures established by a creditor that constituted the violation before its involvefor the type of credit requested. The term does ment with the credit transaction. The term does not include the use of an account or line of credit not include a person whose only participation in to obtain an amount of credit that does not exceed a credit transaction involves honoring a credit a previously established credit limit. A completed card. application for credit means an application in (m) Credit transaction means every aspect of connection with which a creditor has received all an applicant's dealings with a creditor regarding the information that the creditor regularly obtains an application for, or an existing extension of, and considers in evaluating applications for the credit including, but not limited to, information amount and type of credit requested (including, requirements; investigation procedures; standards but not limited to, credit reports, any additional of creditworthiness; terms of credit; furnishing of information requested from the applicant, and any credit information; revocation, alteration, or terapprovals or reports by governmental agencies or mination of credit; and collection procedures. other persons that are necessary to guarantee, (n) Discriminate against an applicant means insure, or provide security for the credit or collat- to treat an applicant less favorably than other eral); provided, however, that the creditor has applicants. exercised reasonable diligence in obtaining such (o) Elderly means an age of 62 or older. information. Where an application is incomplete (p) Empirically derived credit system. (1) The respecting matters that the applicant can complete, term means a credit scoring system that evaluates a creditor shall make a reasonable effort to notify an applicant's creditworthiness primarily by allothe applicant of the incompleteness and shall allow cating points (or by using a comparable basis for the applicant a reasonable opportunity to complete assigning weights) to key attributes describing the the application. applicant and other aspects of the transaction. In (g) Board means the Board of Governors of such a system, the points (or weights) assigned the Federal Reserve System. to each attribute, and hence the entire score: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-30 Federal Reserve Bulletin • January 1977 (i) are derived from an empirical comparison card; the consolidation of two or more obligations; of sample groups or the population of creditworthy or the continuance of existing credit without any and non-creditworthy applicants of a creditor who special effort to collect at or after maturity. applied for credit within a reasonable preceding (r) Good faith means honesty in fact in the period of time; and conduct or transaction. (ii) determine, alone or in conjunction with (s) Inadvertent error means a mechanical, an evaluation of additional information about the electronic, or clerical error that a creditor demonapplicant, whether an applicant is deemed credit- strates was not intentional and occurred notwithworthy. standing the maintenance of procedures reasonably (2) A demonstrably and statistically sound, adapted to avoid any such error. empirically derived credit system is a sytem: (t) Judgmental system of evaluating appli- (i) in which the data used to develop the cants means any system for evaluating the creditsystem, if not the complete population consisting worthiness of an applicant other than a demonof all applicants, are obtained from the applicant strably and statistically sound, empirically derived file by using appropriate sampling principles; credit system. (ii) which is developed for the purpose of (u) Marital status means the state of being predicting the creditworthiness of applicants with unmarried, married, or separated, as defined by respect to the legitimate business interests of the applicable State law. For the purposes of this Part, creditor utilizing the system, including, but not the term "unmarried" includes persons who are limited to, minimizing bad debt losses and operat- single, divorced, or widowed. ing expenses in accordance with the creditor's (v) Negative factor or value, in relation to the business judgment; age of elderly applicants, means utilizing a factor, (iii) which, upon validation using appropriate value, or weight that is less favorable regarding statistical principles, separates creditworthy and elderly applicants than the creditor's experience non-creditworthy applicants at a statistically sig- warrants or is less favorable than the factor, value, nificant rate; and or weight assigned to the class of applicants that (iv) which is periodically revalidated as to its are not classified as elderly applicants and are most predictive ability by the use of appropriate statisti- favored by a creditor on the basis of age. cal principles and is adjusted as necessary to (w) Open end credit means credit extended maintain its predictive ability. pursuant to a plan under which a creditor may (3) A creditor may use a demonstrably and permit an applicant to make purchases or obtain statistically sound, empirically derived credit sys- loans from time to time directly from the creditor tem obtained from another person or may obtain or indirectly by use of a credit card, check, or credit experience from which such a system may other device as the plan may provide. The term be developed. Any such system must satisfy the does not include negotiated advances under an tests set forth in subsections (1) and (2); provided open end real estate mortgage or a letter of credit. that, if a creditor is unable during the development (x) Person means a natural person, corporation, process to validate the system based on its own government or governmental subdivision or credit experience in accordance with subsection agency, trust, estate, partnership, cooperative, or (2)(iii), then the system must be validated when association. sufficient credit experience becomes available. A (y) Pertinent element of creditworthiness, in system that fails this validity test shall henceforth relation to a judgmental system of evaluating apbe deemed not to be a demonstrably and statisti- plicants, means any information about applicants cally sound, empirically derived credit system for that a creditor obtains and considers and that has that creditor. a demonstrable relationship to a determination of (q) Extend credit and extension of credit mean creditworthiness. the granting of credit in any form and include, (z) Prohibited basis means race, color, relibut are not limited to, credit granted in addition gion, national origin, sex, marital status, or age to any existing credit or credit limit; credit granted (provided that the applicant has the capacity to pursuant to an open end credit plan; the refinanc- enter into a binding contract); the fact that all or ing or other renewal of credit, including the is- part of the applicant's income derives from any suance of a new credit card in place of an expiring public assistance program, or the fact that the credit card or in substitution for an existing credit applicant has in good faith exercised any right Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 31 under the Consumer Credit Protection Act3 or any vided through pipe, wire, or other connected fa- State law upon which an exemption has been cilities if the charges for such public utility servgranted by the Board. ices, the charges for delayed payment, and any (aa) Public assistance program means any discount allowed for early payment are filed with, Federal, State, or local governmental assistance or reviewed or regulated by, an agency of the program that provides a continuing, periodic in- Federal government, a State, or a political subdicome supplement, whether premised on entitle- vision thereof; ment or need. The term includes, but is not limited (2) extensions of credit subject to regulation to, Aid to Families with Dependent Children, food under section 7 of the Securities Exchange Act stamps, rent and mortgage supplement or assist- of 1934 or extensions of credit by a broker or ance programs, Social Security and Supplemental dealer subject to regulation as a broker or dealer Security Income, and unemployment compensa- under the Securities Exchange Act of 1934; tion. (3) extensions of incidental consumer credit, (bb) State means any State, the District of other than of the types described in subsections Columbia, the Commonwealth of Puerto Rico, or (a)(1) and (2): any territory or possession of the United States. (i) that are not made pursuant to the terms (cc) Captions and catchlines are intended solely of a credit card account; as aids to convenient reference, and no inference (ii) on which no finance charge as defined as to the substance of any provision of this Part in section 226.4 of this Title (Regulation Z, 12 may be drawn from them. CFR 226.4) is or may be imposed; and (dd) Footnotes shall have the same legal effect (iii) that are not payable by agreement in more as the text of the regulation, whether they are than four instalments; explanatory or illustrative in nature. (4) extensions of credits primarily for business or commercial purposes, including extensions of credit primarily for agricultural purposes, but ex- Section 202.3— cluding extensions of credit of the types described Special Treatment for in subsections (a)(1) and (2); and Certain Classes of Transactions (5) extensions of credit made to governments or governmental subdivisions, agencies, or instru- (a) Classes of transactions afforded special mentalities. treatment. Pursuant to section 703(a) of the Act, (b) Public utilities credit. The following prothe following classes of transactions are afforded visions of this Part shall not apply to extensions specialized treatment: of credit of the type described in subsection (a)(1): (1) extensions of credit relating to transactions (1) section 202.5(d)(1) concerning information under public utility tariffs involving services pro- about marital status; (2) section 202.10 relating to furnishing of 3 The first clause of the definition is not limited to charac- credit information; and teristics of the applicant. Therefore, "prohibited basis" as used (3) section 202.12(b) relating to record retenin this Part refers not only to the race, color, religion, national tion. origin, sex, marital status, or age of an applicant (or of partners or officers of an applicant), but refers also to the characteristics (c) Securities credit. The following provisions of individuals with whom an applicant deals. This means, for of this Part shall not apply to extensions of credit example, that, under the general rule stated in section 202.4, a creditor may not discriminate against a non-Jewish applicant of the type described in subsection (a)(2): because of that person's business dealings with Jews, or (1) section 202.5(c) concerning information discriminate against an applicant because of the characteristics about a spouse or former spouse; of persons to whom the extension of credit relates (e.g., the prospective tenants in an apartment complex to be constructed (2) section 202.5(d)(1) concerning information with the proceeds of the credit requested), or because of the about marital status; characteristics of other individuals residing in the neighborhood (3) section 202.5(d)(3) concerning information where the property offered as collateral is located. A creditor may take into account, however, any applicable law, regula- about the sex of an applicant; tion, or executive order restricting dealings with citizens or (4) section 202.7(b) relating to designation of governments of other countries or imposing limitations regarding credit extended for their use. name but only to the extent necessary to prevent The second clause is limited to an applicant's receipt of violation of rules regarding an account in which public assistance income and to an applicant's good faith a broker or dealer has an interest, or rules necessiexercise of rights under the Consumer Credit Protection Act or applicable State law. tating the aggregation of accounts of spouses for Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-32 Federal Reserve Bulletin • January 1977 the purpose of determining controlling interests, tion 202.2 relating to definitions and rules of beneficial interests, beneficial ownership, or pur- construction, this section, section 202.4 relating chase limitations and restrictions; to the general rule prohibiting discrimination, sec- (5) section 202.7(c) relating to action concern- tion 202.6(a) relating to the use of information, ing open end accounts, but only to the extent the section 202.11 relating to State laws, and section action taken is on the basis of a change of name 202.12(a) relating to the retention of prohibited or marital status; information, the provisions of this Part shall not (6) section 202.7(d) relating to signature of a apply to extensions of credit of the type described spouse or other person; in subsection (a)(5). (7) section 202.10 relating to furnishing of credit information; and Section 202.4—General (8) section 202.12(b) relating to record reten- Rule Prohibiting Discrimination tion. A creditor shall not discriminate against an (d) Incidental credit. The following provisions applicant on a prohibited basis regarding any of this Part shall not apply to extensions of credit aspect of a credit transaction. of the type described in subsection (a)(3): (1) section 202.5(c) concerning information Section 202.5—Rules about a spouse or former spouse; Concerning Applications (2) section 202.5(d)(1) concerning information about marital status; (a) Discouraging applications. A creditor shall (3) section 202.5(d)(2) concerning information not make any oral or written statement, in adverabout income derived from alimony, child support, tising or otherwise, to applicants or prospective or separate maintenance payments; applicants that would discourage on a prohibited (4) section 202.5(d)(3) concerning information basis a reasonable person from making or pursuing about the sex of an applicant to the extent neces- an application. sary for medical records or similar purposes; (b) General rules concerning requests for in- (5) section 202.7(d) relating to signature of a formation. (1) Except as otherwise provided in spouse or other person; this section, a creditor may request any informa- (6) section 202.9 relating to notifications; tion in connection with an application.4 (7) section 202.10 relating to furnishing of (2) Notwithstanding any other provision of this credit information; and section, a creditor shall request an applicant's (8) section 202.12(b) relating to record reten- race/national origin, sex, and marital status as tion. required in section 202.13 (information for moni- (e) Business credit. The following provisions toring purposes). In addition, a creditor may obtain of this Part shall not apply to extensions of credit such information as may be required by a regulaof the type described in subsection (a)(4): tion, order, or agreement issued by, or entered (1) section 202.5(d)(1) concerning information into with, a court or an enforcement agency (inabout marital status; cluding the Attorney General or a similar State (2) section 202.9 relating to notifications, official) to monitor or enforce compliance with the unless an applicant, within 30 days after oral or Act, this Part, or other Federal or State statute written notification that adverse action has been or regulation. taken, requests in writing the reasons for such (3) The provisions of this section limiting peraction; missible information requests are subject to the (3) section 202.10 relating to furnishing of provisions of section 202.7(e) regarding insurance credit information; and and sections 202.8(c) and (d) regarding special (4) section 202.12(b) relating to record reten- purpose credit programs. tion, unless an applicant, within 90 days after adverse action has been taken, requests in writing that the records relating to the application be 4 This subsection is not intended to limit or abrogate any Federal or State law regarding privacy, privileged information, retained. credit reporting limitations, or similar restrictions on obtainable (f) Governmental credit. Except for section information. Furthermore, permission to request information 202.1 relating to authority, scope, enforcement, should not be confused with how it may be utilized, which is governed by section 202.6 (rules concerning evaluation of penalties and liabilities, and interpretations, sec- applications). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 33 (c) Information about a spouse or former category "unmarried" includes single, divorced, spouse. (1) Except as permitted in this subsection, and widowed persons. a creditor may not request any information con- (2) A creditor shall not inquire whether any cerning the spouse or former spouse of an appli- income stated in an application is derived from cant. alimony, child support, or separate maintenance (2) A creditor may request any information payments, unless the creditor appropriately disconcerning an applicant's spouse (or former closes to the applicant that such income need not spouse under (v) below) that may be requested be revealed if the applicant does not desire the about the applicant if: creditor to consider such income in determing the (i) the spouse will be permitted to use the applicant's creditworthiness. Since a general inaccount; or quiry about income, without further specification, (ii) the spouse will be contractually liable may lead an applicant to list alimony, child supupon the account; or port, or separate maintenance payments, a creditor (iii) the applicant is relying on the spouse's shall provide an appropriate notice to an applicant income as a basis for repayment of the credit before inquiring about the source of an applicant's requested; or income, unless the terms of the inquiry (such as (iv) the applicant resides in a community an inquiry about salary, wages, investment inproperty State or property upon which the appli- come, or similarly specified income) tend to precant is relying as a basis for repayment of the credit clude the unintentional disclosure of alimony, requested is located in such a State; or child support, or separate maintenance payments. (v) the applicant is relying on alimony, child (3) A creditor shall not request the sex of an support, or separate maintenance payments from applicant. An applicant may be requested to desa spouse or former spouse as a basis for repayment ignate a title on an application form (such as Ms., of the credit requested. Miss, Mr., or Mrs.) if the form appropriately (3) A creditor may request an applicant to list discloses that the designation of such a title is any account upon which the applicant is liable and optional. An application form shall otherwise use to provide the name and address in which such only terms that are neutral as to sex. account is carried. A creditor may also ask the (4) A creditor shall not request information names in which an applicant has previously re- about birth control practices, intentions concerning ceived credit. the bearing or rearing of children, or capability (d) Information a creditor may not request. to bear children. This does not preclude a creditor (1) If an applicant applies for an individual, unse- from inquiring about the number and ages of an cured account, a creditor shall not request the applicant's dependents or about dependent-related applicant's marital status, unless the applicant re- financial obligations or expenditures, provided sides in a community property State or property such information is requested without regard to upon which the applicant is relying as a basis for sex, marital status, or any other prohibited basis. repayment of the credit requested is located in such (5) A creditor shall not request the race, color, a State.5 Where an application is for other than religion, or national origin of an applicant or any individual, unsecured credit, a creditor may re- other person in connection with a credit transacquest an applicant's marital status. Only the terms tion. A creditor may inquire, however, as to an "married," "unmarried," and "separated" shall applicant's permanent residence and immigration be used, and a creditor may explain that the status. (e) Application forms. A creditor need not use written applications. If a creditor chooses to use written forms, it may design its own,6 use forms 5 This provision does not preclude requesting relevant information that may indirectly disclose marital status, such as asking about liability to pay alimony, child support, or separate maintenance; the source of income to be used as a basis for the repayment of the credit requested, which may disclose that 6 A creditor also may continue to use any application form it is a spouse's income; whether any obligation disclosed by that complies with the requirements of the October 28, 1975 the applicant has a co-obligor, which may disclose that the version of Regulation B until its present stock of those forms co-obligor is a spouse or former spouse; or the ownership of is exhausted or until March 23, 1978, whichever occurs first. assets, which may disclose the interest of a spouse, when such The provisions of this Part shall not determine and are not assets are relied upon in extending the credit. Such inquiries evidence of the meaning of the requirements of the previous are allowed by the general rule of subsection (b)(1). version of Regulation B. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-34 Federal Reserve Bulletin • January 1977 prepared by another person, or use the appropriate creditor shall not take into account an applicant's model application forms contained in Appendix B. age (provided that the applicant has the capacity If a creditor chooses to use an Appendix B form, to enter into a binding contract) or whether an it may change the form: applicant's income derives from any public assist- (1) by asking for additional information not ance program. prohibited by this section; (ii) In a demonstrably and statistically sound, (2) by deleting any information request; or empirically derived credit system, a creditor may (3) by rearranging the format without modify- use an applicant's age as a predictive variable, ing the substance of the inquiries; provided that provided that the age of an elderly applicant is in each of these three instances the appropriate not assigned a negative factor or value. notices regarding the optional nature of courtesy (iii) In a judgmental system of evaluating titles, the option to disclose alimony, child sup- creditworthiness, a creditor may consider an apport, or separate maintenance, and the limitation plicant's age or whether an applicant's income concerning marital status inquiries are included in derives from any public assistance program only the appropriate places if the items to which they for the purpose of determining a pertinent element relate appear on the creditor's form. If a creditor of creditworthiness.9 uses an appropriate Appendix B model form or (iv) In any system of evaluating creditworto the extent that it modifies such a form in thiness, a creditor may consider the age of an accordance with the provisions of clauses (2) or elderly applicant when such age is to be used to (3) of the preceding sentence or the instructions favor the elderly applicant in extending credit. to Appendix B, that creditor shall be deemed to (3) A creditor shall not use, in evaluating the be acting in compliance with the provisions of creditworthiness of an applicant, assumptions or subsections (c) and (d). aggregate statistics relating to the likelihood that any group of persons will bear or rear children Section 202.6— or, for that reason, will receive diminished or Rules Concerning Evaluation of Applications interrupted income in the future. (4) A creditor shall not take into account the (a) General rule concerning use of informa- existence of a telephone listing in the name of an tion. Except as otherwise provided in the Act and applicant for consumer credit. A creditor may take this Part, a creditor may consider in evaluating into account the existence of a telephone in the an application any information that the creditor residence of such an applicant. obtains, so long as the information is not used (5) A creditor shall not discount or exclude to discriminate against an applicant on a prohibited from consideration the income of an applicant or basis.7 (b) Specific rules concerning use of information. (1) Except as provided in the Act and this Part, a creditor shall not take a prohibited basis 9 Concerning income derived from a public assistance program, a creditor may consider, for example, the length of time into account in any system of evaluating the cred- an applicant has been receiving such income; whether an itworthiness of applicants.8 applicant intends to continue to reside in the jurisdiction in relation to residency requirements for benefits; and the status (2)(i) Except as permitted in this subsection, a of an applicant's dependents to ascertain whether benefits that the applicant is presently receiving will continue. Concerning age, a creditor may consider, for example, the 7 The legislative history of the Act indicates that the Congress occupation and length of time to retirement of an applicant intended an "effects test" concept, as outlined in the employ- to ascertain whether the applicant's income (including retirement field by the Supreme Court in the cases of Griggs v. ment income, as applicable) will support the extension of credit Duke Power Co., 401 U.S. 424 (1971), and Albemarle Paper until its maturity; or the adequacy of any security offered if Co. v. Moody, 422 U.S. 405 (1975), to be applicable to a the duration of the credit extension will exceed the life expeccreditor's determination of creditworthiness. See Senate Report tancy of the applicant. An elderly applicant might not qualify to accompany H.R. 6516, No. 94-589, pp. 4-5; House Report for a five-percent down, 30-year mortgage loan because the to accompany H.R. 6516, No. 94-210, p. 5. duration of the loan exceeds the applicant's life expectancy and the cost of realizing on the collateral might exceed the 8 This provision does not prevent a creditor from considering applicant's equity. The same applicant might qualify with a the marital status of an applicant or the source of an applicant's larger downpayment and a shorter loan maturity. A creditor income for the purpose of ascertaining the creditor's rights could also consider an applicant's age, for example, to assess and remedies applicable to the particular extension of credit the significance of the applicant's length of employment or and not to discriminate in a determination of creditworthiness. residence (a young applicant may have just entered the job Furthermore, a prohibited basis may be considered in accord- market; an elderly applicant may recently have retired and ance with section 202.8 (special purpose credit programs). moved from a long-time residence). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 35 the spouse of the applicant because of a prohibited Section 202.7— basis or because the income is derived from part- Rules Concerning Extensions of Credit time employment, or from an annuity, pension, or other retirement benefit; but a creditor may (a) Individual accounts. A creditor shall not consider the amount and probable continuance of refuse to grant an individual account to a creditany income in evaluating an applicant's credit- worthy applicant on the basis of sex, marital worthiness. Where an applicant relies on alimony, status, or any other prohibited basis. child support, or separate maintenance payments (b) Designation of name. A creditor shall not in applying for credit, a creditor shall consider prohibit an applicant from opening or maintaining such payments as income to the extent that they an account in a birth-given first name and a surare likely to be consistently made. Factors that name that is the applicant's birth-given surname, a creditor may consider in determining the likeli- the spouse's surname, or a combined surname. hood of consistent payments include, but are not (c) Action concerning existing open end aclimited to, whether the payments are received counts. (1) In the absence of evidence of inability pursuant to a written agreement or court decree; or unwillingness to repay, a creditor shall not take the length of time that the payments have been any of the following actions regarding an applicant received; the regularity of receipt; the availability who is contractually liable on an existing open end of procedures to compel payment; and the credit- account on the basis of the applicant's reaching worthiness of the payor, including the credit his- a certain age or retiring, or on the basis of a change tory of the payor where available to the creditor in the applicant's name or marital status: under the Fair Credit Reporting Act or other ap- (i) require a reapplication; or plicable laws. (ii) change the terms of the account; or (6) To the extent that a creditor considers credit (iii) terminate the account. history in evaluating the creditworthiness of simi- (2) A creditor may require a reapplication relarly qualified applicants for a similar type and garding an open end account on the basis of a amount of credit, in evaluating an applicant's change in an applicant's marital status where the creditworthiness, a creditor shall consider (unless credit granted was based on income earned by the the failure to consider results from an inadvertent applicant's spouse if the applicant's income alone error): at the time of the original application would not (i) the credit history, when available, of support the amount of credit currently extended. accounts designated as accounts that the applicant (d) Signature of spouse or other person. (1) and a spouse are permitted to use or for which Except as provided in this subsection, a creditor both are contractually liable; shall not require the signature of an applicant's (ii) on the applicant's request, any informa- spouse or other person, other than a joint applition that the applicant may present tending to cant, on any credit instrument if the applicant indicate that the credit history being considered qualifies under the creditor's standards of creditby the creditor does not accurately reflect the worthiness for the amount and terms of the credit applicant's creditworthiness; and requested. (iii) on the applicant's request, the credit (2) If an applicant requests unsecured credit and history, when available, of any account reported relies in part upon property to establish creditin the name of the applicant's spouse or former worthiness, a creditor may consider State law; the spouse that the applicant can demonstrate accu- form of ownership of the property; its susceprately reflects the applicant's creditworthiness. tibility to attachment, execution, severance, and (7) A creditor may consider whether an appli- partition; and other factors that may affect the cant is a permanent resident of the United States, value to the creditor of the applicant's interest in the applicant's immigration status, and such addi- the property. If necessary to satisfy the creditor's tional information as may be necessary to ascertain standards of creditworthiness, the creditor may its rights and remedies regarding repayment. require the signature of the applicant's spouse or (c) State property laws. A creditor's consid- other person on any instrument necessary, or reaeration or application of State property laws di- sonably believed by the creditor to be necessary, rectly or indirectly affecting creditworthiness shall under applicable State law to make the property not constitute unlawful discrimination for the pur- relied upon available to satisfy the debt in the event poses of the Act or this Part. of default. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-36 Federal Reserve Bulletin • January 1977 (3) If a married applicant requests unsecured applicant's age. Notwithstanding any other provicredit and resides in a community property State sion of this Part, information about the age, sex, or if the property upon which the applicant is or marital status of an applicant may be requested relying is located in such a State, a creditor may in an application for insurance. require the signature of the spouse on any instrument necessary, or reasonably believed by the Section 202.8— creditor to be necessary, under applicable State Special Purpose Credit Programs law to make the community property available to satisfy the debt in the event of default if: (a) Standards for programs. Subject to the (i) applicable State law denies the applicant provisions of subsection (b), the Act and this Part power to manage or control sufficient community are not violated if a creditor refuses to extend property to qualify for the amount of credit recredit to an applicant solely because the applicant quested under the creditor's standards of creditdoes not qualify under the special requirements worthiness; and that define eligibility for the following types of (ii) the applicant does not have sufficient special purpose credit programs: separate property to qualify for the amount of (1) any credit assistance program expressly aucredit requested without regard to community thorized by Federal or State law for the benefit property. of an economically disadvantaged class of persons; (4) If an applicant requests secured credit, a or creditor may require the signature of the appli- (2) any credit assistance program offered by a cant's spouse or other person on any instrument not-for-profit organization, as defined under secnecessary, or reasonably believed by the creditor tion 501(c) of the Internal Revenue Code of 1954, to be necessary, under applicable State law to as amended, for the benefit of its members or for make the property being offered as security availthe benefit of an economically disadvantaged class able to satisfy the debt in the event of default, of persons; or for example, any instrument to create a valid lien, (3) any special purpose credit program offered pass clear title, waive inchoate rights, or assign by a for-profit organization or in which such an earnings. organization participates to meet special social (5) If, under a creditor's standards of creditneeds, provided that: worthiness, the personal liability of an additional (i) the program is established and adminisparty is necessary to support the extension of the tered pursuant to a written plan that (A) identifies credit requested,10 a creditor may request that the the class or classes of persons that the program applicant obtain a co-signer, guarantor, or the like. is designed to benefit and (B) sets forth the proce- The applicant's spouse may serve as an additional dures and standards for extending credit pursuant party, but a creditor shall not require that the to the program; and spouse be the additional party. For the purposes (ii) the program is established and adminisof subsection (d), a creditor shall not impose tered to extend credit to a class of persons who, requirements upon an additional party that the pursuant to the customary standards of creditcreditor may not impose upon an applicant. worthiness used by the organization extending the (e) Insurance. Differentiation in the availcredit, either probably would not receive such ability, rates, and terms on which credit-related credit or probably would receive it on less favorcasualty insurance or credit life, health, accident, able terms than are ordinarily available to other or disability insurance is offered or provided to applicants applying to the organization for a simian applicant shall not constitute a violation of the lar type and amount of credit. Act or this Part; but a creditor shall not refuse (b) Applicability of other rules. (1) All of the to extend credit and shall not terminate an account provisions of this Part shall apply to each of the because credit life, health, accident, or disability special purpose credit programs described in subinsurance is not available on the basis of the section (a) to the extent that those provisions are not inconsistent with the provisions of this section. 10If an applicant requests individual credit relying on the (2) A program described in subsections (a)(2) separate income of another person, a creditor may require the or (a)(3) shall qualify as a special purpose credit signature of the other person to make the income available to pay the debt. program under subsection (a) only if it was estab- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 37 lished and is administered so as not to discriminate Section 202-9—Notifications against an applicant on the basis of race, color, religion, national origin, sex, marital status, age (a) Notification of action taken, ECO A notice, (provided that the applicant has the capacity to and statement of specific reasons. enter into a binding contract), income derived from (1) Notification of action taken. A creditor a public assistance program or good faith exercise shall notify an applicant of action taken within: of any right under the Consumer Credit Protection (i) 30 days after receiving a completed appli- Act or any State law upon which an exemption cation concerning the creditor's approval of, or has been granted therefrom by the Board; except adverse action regarding, the application (notifithat all program participants may be required to cation of approval may be express or by implicashare one or more of those characteristics so long tion, where, for example, the applicant receives as the program was not established and is not a credit card, money, property, or services in administered with the purpose of evading the re- accordance with the application); quirements of the Act or this Part. (ii) 30 days after taking adverse action on an (c) Special rule concerning requests and use uncompleted application; of information. If all participants in a special (iii) 30 days after taking adverse action repurpose credit program described in subsection (a) garding an existing account; and are or will be required to possess one or more (iv) 90 days after the creditor has notified the common characteristics relating to race, color, applicant of an offer to grant credit other than in religion, national origin, sex, marital status, age, substantially the amount or on substantially the or receipt of income from a public assistance terms requested by the applicant if the applicant program and if the special purpose credit program during those 90 days has not expressly accepted otherwise satisfies the requirements of subsection or used the credit offered. (a), then, notwithstanding the prohibitions of sec- (2) Content of notification. Any notification tions 202.5 and 202.6, the creditor may request given to an applicant against whom adverse action of an applicant and may consider, in determining is taken shall be in writing and shall contain: a eligibility for such program, information regarding statement of the action taken; a statement of the the common characteristics required for eligibility. provisions of section 701(a) of the Act; the name In such circumstances, the solicitation and consid- and address of the Federal agency that administers eration of that information shall not constitute compliance concerning the creditor giving the nounlawful discrimination for the purposes of the Act tification; and or this Part. (i) a statement of specific reasons for the (d) Special rule in the case of financial need. action taken; or If financial need is or will be one of the criteria (ii) a disclosure of the applicant's right to a for the extension of credit under a special purpose statement of reasons within 30 days after receipt credit program described in subsection (a), then, by the creditor of a request made within 60 days notwithstanding the prohibitions of sections 202.5 of such notification, the disclosure to include the and 202.6, the creditor may request and consider, name, address, and telephone number of the perin determining eligibility for such program, infor- son or office from which the statement of reasons mation regarding applicant's marital status, in- can be obtained. If the creditor chooses to provide come from alimony, child support, or separate the statement of reasons orally, the notification maintenance, and the spouse's financial resources. shall also include a disclosure of the applicant's In addition, notwithstanding the prohibitions of right to have any oral statement of reasons consection 202.7(d), a creditor may obtain the signa- firmed in writing within 30 days after a written ture of an applicant's spouse or other person on request for confirmation is received by the creditor. an application or credit instrument relating to a (3) Multiple applicants. If there is more than special purpose program if required by Federal or one applicant, the notification need only be given State law. In such circumstances, the solicitation to one of them, but must be given to the primary and consideration of that information and the ob- applicant where one is readily apparent. taining of a required signature shall not constitute (4) Multiple creditors. If a transaction involves unlawful discrimination for the purposes of the Act more than one creditor and the applicant expressly or this Part. accepts or uses the credit offered, this section does Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-38 Federal Reserve Bulletin • January 1977 not require notification of adverse action by any the applicant failed to achieve the qualifying score creditor. If a transaction involves more than one on the creditor's credit scoring system are insufficreditor and either no credit is offered or the cient. applicant does not expressly accept or use any credit offered, then each creditor taking adverse STATEMENT OF CREDIT DENIAL, action must comply with this section. The required TERMITION, OR CHANGE notification may be provided indirectly through a third party, which may be one of the creditors, Date_ provided that the identity of each creditor taking Applicant's Name: adverse action is disclosed. Whenever the notifi- Applicant's Address: cation is to be provided through a third party, a creditor shall not be liable for any act or omission Description of Account, Transaction, or Requested of the third party that constitutes a violation of Credit: this section if the creditor accurately and in a timely manner provided the third party with the Description of Adverse Action Taken: information necessary for the notification and was maintaining procedures reasonably adapted to avoid any such violation. PRINCIPAL REASON(S) FOR ADVERSE ACTION CONCERNING CREDIT (b) Form of EC OA notice and statement of specific reasons. Credit application incomplete (1) ECO A notice. A creditor satisfies the re- Insufficient credit references quirements of subsection (a)(2) regarding a state- Unable to verify credit references ment of the provisions of section 701(a) of the Temporary or irregular employment Act and the name and address of the appropriate Length of employment Federal enforcement agency if it provides the Insufficient income following notice, or one that is substantially simi- Excessive obligations lar: Unable to verify income The Federal Equal Credit Opportunity Act pro- Inadequate collateral hibits creditors from discriminating against credit Too short a period of residence applicants on the basis of race, color, religion, Temporary residence national origin, sex, marital status, age (provided that the applicant has the capacity to enter into Unable to verify residence a binding contract); because all or part of the No credit file applicant's income derives from any public assist- Insufficient credit file ance program; or because the applicant has in good Delinquent credit obligations faith exercised any right under the Consumer Credit Protection Act. The Federal agency that Garnishment, attachment, foreclosure, administers compliance with this law concerning repossession, or suit this creditor is (name and address as specified by Bankruptcy the appropriate agency listed in Appendix A). We do not grant credit to any applicant on The sample notice printed above may be modi- the terms and conditions you request. fied immediately following the required references Other, specify: to the Federal Act and enforcement agency to include references to any similar State statute or DISCLOSURE OF USE OF INFORMATION regulation and to a State enforcement agency. OBTAINED FROM AN OUTSIDE SOURCE (2) Statement of specific reasons. A statement of reasons for adverse action shall be sufficient Disclosure inapplicable if it is specific and indicates the principal reason(s) Information obtained in a report from a confor the adverse action. A creditor may formulate sumer reporting agency its own statement of reasons in checklist or letter Name: form or may use all or a portion of the sample form printed below, which, ir properly completed, Street address: satisfies the requirements of subsection (a)(2)(i). Telephone number: Statements that the adverse action was based on Information obtained from an outside source the creditor's internal standards or policies or that other than a consumer reporting agency. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 39 Under the Fair Credit Reporting Act, you June 1, 1977, a creditor that furnishes credit inhave the right to make a written request, formation shall: within 60 days of receipt of this notice, for (i) determine whether an account offered by disclosure of the nature of the adverse in- the creditor is one that an applicant's spouse is formation. permitted to use or upon which the spouses are Creditor's name: contractually liable other than as guarantors, sure- Creditor's address: ties, endorsers, or similar parties; and Creditor's telephone number: (ii) designate any such account to reflect the [Add ECOA Notice] fact of participation of both spouses.11 (2) Except as provided in subsection (3), if a (3) Other information. The notification re- creditor furnishes credit information concerning an quired by subsection (a)(1) may include other account designated under this section (or desiginformation so long as it does not detract from nated prior to the effective date of this Part) to the required content. This notification also may a consumer reporting agency, it shall furnish the be combined with any disclosures required under information in a manner that will enable the other titles of the Consumer Credit Protection Act agency to provide access to the information in the or any other law, provided that all requirements name of each spouse. for clarity and placement are satisfied; and it may (3) If a creditor furnishes credit information appear on either or both sides of the paper if there concerning an account designated under this secis a clear reference on the front to any information tion (or designated prior to the effective date of on the back. this Part) in response to an inquiry regarding a (c) Oral notifications. The applicable require- particular applicant, it shall furnish the information ments of this section are satisfied by oral notifica- in the name of the spouse about whom such tions (including statements of specific reasons) in information is requested.12 the case of any creditor that did not receive more (b) Accounts established prior to June 1, than 150 applications during the calendar year 1977. For every account established prior to and immediately preceding the calendar year in which in existence on June 1, 1977, a creditor that the notification of adverse action is to be given furnishes credit information shall either: to a particular applicant. (1) not later than June 1, 1977 (d) Withdrawn applications. Where an appli- (i) determine whether the account is one that cant submits an application and the parties con- an applicant's spouse, if any, is permitted to use template that the applicant will inquire about its or upon which the spouses are contractually liable status, if the creditor approves the application and other than as guarantors, sureties, endorsers, or the applicant has not inquired within 30 days after similar parties; applying, then the creditor may treat the applica- (ii) designate any such account to reflect the tion as withdrawn and need not comply with fact of participation of both spouses;13 and subsection (a)(1). (iii) comply with the reporting requirements (e) Failure of compliance. A failure to comply of subsections (a)(2) and (a)(3); or with this section shall not constitute a violation (2) mail or deliver to all applicants, or all when caused by an inadvertent error; provided married applicants, in whose name an account is that, on discovering the error, the creditor corrects carried on the creditor's records one copy of the it as soon as possible and commences compliance notice set forth below.14 The notice may be mailed with the requirements of this section. (f) Notification. A creditor notifies an applicant when a writing addressed to the applicant is delivered or mailed to the applicant's last known address or, in the case of an oral notification, when 11A creditor need not distinguish between participation as the creditor communicates with the applicant. a user or as a contractually liable party. 12 If a creditor learns that new parties have undertaken payment on an account, then the subsequent history of the Section 202.10— account shall be furnished in the names of the new parties and need not continue to be furnished in the names of the Furnishing of Credit Information former parties. 13 See footnote 11. (a) Accounts established on or after June 1, 14 A creditor may delete the references to the "use" of an 1977. (1) For every account established on or after account when providing notices regarding closed end accounts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-40 Federal Reserve Bulletin • January 1977 with a billing statement or other mailing. All such count, please report all information concerning the notices shall be mailed or delivered by October account.in both our names. 1, 1977. As to open end accounts, this requirement may be satisfied by mailing one notice at any time Account number Print or type name prior to October 2, 1977, regarding each account Print or type name for which a billing statement is sent between June 1 and October 1, 1977. The notice may be sup- Signature of either spouse plemented as necessary to permit identification of the account by the creditor or by a consumer (c) Requests to change manner in which inreporting agency. A creditor need only send no- formation is reported. Within 90 days after retices relating to those accounts on which it lacks ceipt of a properly completed request to change the information necessary to make the proper des- the manner in which information is reported to ignation regarding participation or contractual lia- consumer reporting agencies and others regarding bility. an account described in subsection (b), a creditor shall designate the account to reflect the fact of NOTICE participation of both spouses.15 When furnishing CREDIT HISTORY FOR MARRIED PERSONS information concerning any such account, the The Federal Equal Credit Opportunity Act pro- creditor shall comply with the reporting requirehibits credit discrimination on the basis of race, ments of subsections (a)(2) and (a)(3). The signacolor, religion, national origin, sex, marital status, ture of an applicant or the applicant's spouse on age (provided that a person has the capacity to a request to change the manner in which informaenter into a binding contract); because all or part tion concerning an account is furnished shall not of a person's income derives from any public alter the legal liability of either spouse upon the assistance program; or because a person in good account or require the creditor to change the name faith has exercised any right under the Federal in which the account is carried. Consumer Credit Protection Act. Regulations (d) Inadvertent errors. A failure to comply under the Act give married persons the right to with this section shall not constitute a violation have credit information included in credit reports when caused by an inadvertent error, provided in the name of both the wife and the husband if that, on discovering the error, the creditor corrects both use or are responsible for the account. This it as soon as possible and commences compliance right was created, in part, to insure that credit with the requirements of this section. histories will be available to women who become divorced or widowed. Section 202.11—Relation to State Law If your account with us is one that both husband and wife signed for or is an account that is being (a) Inconsistent State Laws. Except as otherused by one of you who did not sign, then you wise provided in this section, this Part alters, are entitled to have us report credit information affects, or preempts only those State laws that are relating to the account in both your names. If you inconsistent with this Part and then only to the choose to have credit information concerning your extent of the inconsistency. A State law is not account with us reported in both your names, inconsistent with this Part if it is more protective please complete and sign the statement below and of an applicant. return it to us. (b) Preempted provisions of State law. (1) Federal regulations provide that signing your State law is deemed to be inconsistent with the name below will not change your or your spouse's requirements of the Act and this Part and less legal liability on the account. Your signature will protective of an applicant within the meaning of only request that credit information be reported section 705(f) of the Act to the extent that such in both your names. law; If you do not complete and return the form (i) requires or permits a practice or act prohibelow, we will continue to report your credit bited by the Act or this Part; history in the same way that we do now. (ii) prohibits the individual extension of con- When you furnish credit information on this ac- 15 See footnote 11. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 41 sumer credit to both parties to a marriage if each tions. (1) In accordance with the provisions of spouse individually and voluntarily applies for Supplement I to this Part, and State may apply such credit; to the Board for an exemption from the require- (iii) prohibits inquiries or collection of data ments of sections 701 and 702 of the Act and the required to comply with the Act or this Part; corresponding provisions of this Part for any class (iv) prohibits asking age or considering age of credit transactions within the State. The Board in a demonstrably and statistically sound, empiri- will grant such an exemption if : cally derived credit system, to determine a perti- (i) the Board determines that, under the law nent element of creditworthiness, or to favor an of that State, that class of credit transactions is elderly applicant; or subject to requirements substantially similar to (v) prohibits inquiries necessary to establish those imposed under sections 701 and 702 of the or administer a special purpose credit program as Act and the corresponding provisions of this Part, defined by section 202.8. or that applicants are afforded greater protection (2) A determination as to whether a State law than is afforded under sections 701 and 702 of is inconsistent with the requirements of the Act the Act and the corresponding provisions of this and this Part will be made only in response to Part; and a request for a formal Board interpretation. All (ii) there is adequate provision for State enrequests for such interpretations, in addition to forcement. meeting the requirements of section 202.1(d), shall (2) In order to assure that the concurrent juriscomply with the applicable provisions of subsec- diction of Federal and State courts created in tions (b)(1) and (2) of Supplement I to this Part. section 706(f) of the Act will continue to have A determination shall be based on the factors substantive provisions to which such jurisdiction enumerated in this subsection and, as applicable, shall apply; to allow Federal enforcement agencies subsection (c) of Supplement I. Notice of the to retain their authority regarding any class of interpretation shall be provided as specified in credit transactions exempted pursuant to subsecsubsection (e)(1) of Supplement I, but the inter- tion (e)(1) and Supplement I; and, generally, to pretation shall be effective in accordance with aid in implementing the Act: section 202.1. The interpretation shall be subject (i) no such exemption shall be deemed to to revocation or modification at any time, as pro- extend to the civil liability provisions of sections vided in subsection (g)(4) of Supplement I. 706 or the administrative enforcement provisions (c) Finance charges and loan ceilings. If mar- of section 704 of the Act; and ried applicants voluntarily apply for and obtain (ii) after an exemption has been granted, the individual accounts with the same creditor, the requirements of the applicable State law shall accounts shall not be aggregated or otherwise constitute the requirements of the Act and this combined for purposes of determining permissible Part, except to the extent such State law imposes finance charges or permissible loan ceilings under requirements not imposed by the Act or this Part, any Federal or State law. Permissible loan ceiling (3) Exemptions granted by the Board to particlaws shall be construed to permit each spouse to ular classes of credit transactions within specified become individually liable up to the amount of States will be set forth in Supplement II to this the loan ceilings, less the amount for which the Part. applicant is jointly liable.16 (d) State and Federal laws not affected. This Section 202.12—Record Retention section does not alter or annul any provision of State property laws, laws relating to the disposition (a) Retention of prohibited information. Reof decedents' estates, or Federal or State banking tention in a creditor's files of any information, the regulations directed only toward insuring the sol- use of which in evaluating applications is prohibvency of financial institutions. ited by the Act or this Part, shall not constitute (e) Exemption for State regulated transac- a violation of the Act or this Part where such information was obtained: (1) from any source prior to March 23;17 or 16For example, in a State with a permissible loan ceiling of $1,000, if a married couple were jointly liable for unpaid 17Pursuant to the October 28, 1975 version of Regulation debt in the amount of $250, each spouse could subsequently B, the applicable date for sex and marital status information become individually liable for $750. is June 30, 1976. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-42 Federal Reserve Bulletin • January 1977 (2) at any time from consumer reporting agen- disposition of the matter, unless an earlier time cies; or is allowed by order of the agency or court. (3) at any time from an applicant or others (4) In any transaction involving more than one without the specific request of the creditor; or creditor, any creditor not required to comply with (4) at any time as required to monitor compli- section 202.9 (notifications) shall retain for the ance with the Act and this Part or other Federal time period specified in subsection (b) all written or State statutes or regulations. or recorded information in its possession concern- (b) Preservation of records. (1) For 25 months ing the applicant, including a notation of action after the date that a creditor notifies an applicant taken in connection with any adverse action. of action taken on an application, the creditor shall (c) Failure of compliance. A failure to comply retain as to that application in original form or with this section shall not constitute a violation a copy thereof :18 when caused by an inadvertent error. (i) any application form that it receives, any information required to be obtained concerning Section 202.13— characteristics of an applicant to monitor compli- Information for Monitoring Purposes ance with the Act and this Part or other similar law, and any other written or recorded information (a) Scope and information requested. (1) For used in evaluating the application and not returned the purpose of monitoring compliance with the to the applicant at the applicant's request; (ii) a copy of the following documents if provisions of the Act and this Part, any creditor furnished to the applicant in written form (or, if that receives an application for consumer credit furnished orally, any notation or memorandum relating to the purchase of residential real property, with respect thereto made by the creditor): where the extension of credit is to be secured by A) the notification of action taken; and a lien on such property, shall request as part of (B) the statement of specific reasons for any written application for such credit the followadverse action; and ing information regarding the applicant and joint (iii) any written statement submitted by the applicant (if any): applicant alleging a violation of the Act or this (i) race/national origin, using the categories Part. American Indian or Alaskan Native; Asian or (2) For 25 months after the date that a creditor notifies an applicant of adverse action regarding Pacific Islander; Black; White; Hispanic; Other an account, other than in connection with an (Specify); application, the creditor shall retain as to that (ii) sex; account, in original form or a copy thereof:19 (iii) martial status, using the categories mar- (i) any written or recorded information con- ried, unmarried, and separated; and cerning such adverse action; and (iv) age. (ii) any written statement submitted by the (2) "Residential real property" means improved applicant alleging a violation of the Act or this real property used or intended to be used for Part. residential purposes, including single family (3) In addition to the requirements of subsechomes, dwellings for from two to four families, tions (b)(1) and (2), any creditor that has actual notice that it is under investigation or is subject and individual units of condominiums and cooperto an enforcement proceeding for an alleged vio- atives . lation of the Act or this Part by an enforcement (b) Method of obtaining information. Quesagency charged with monitoring that creditor's tions regarding race/national origin, sex, marital compliance with the Act and this Part, or that has status, and age may be listed, at the creditor's been served with notice of an action filed pursuant option, either on the application form or on a to section 706 of the Act and sections 202.1(b) separate form that refers to the application. or (c) of this Part, shall retain the information (c) Disclosure to applicant and joint applirequired in subsections (b)(1) and (2) until final cant. The applicant and joint applicant (if any) shall be informed that the information regarding race/national origin, sex, marital status, and age 18"A copy thereof" includes carbon copies, photocopies, is being requested by the Federal government for microfilm or microfiche copies, or copies produced by any the purpose of monitoring compliance with Federal accurate information retrieval system. A creditor who uses a computerized or mechanized system need not keep a written anti-discrimination statutes and that those statutes copy of a document if it can regenerate the precise text of prohibit creditors from discriminating against apthe document upon request. 19See footnote 18. plicants on those bases. The applicant and joint Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 43 applicant shall be asked, but not required, to 702. Definitions supply the requested information. If the applicant 703. Regulations. or joint applicant chooses not to provide the infor- 704. Administrative enforcement. mation or any part of it, that fact shall be noted 705. Relation to State laws. on the form on which the information is obtained. 706. Civil liability. (d) Substitute monitoring program. Any 707. Annual reports to Congress. monitoring program required by an agency 708. Effective date. charged with administrative enforcement under 709. Short title. section 704 of the Act may be substituted for the § 701. Prohibited discrimination; reasons for requirements contained in subsections (a), (b), and adverse action* (c). (a) It shall be unlawful for any creditor to STATUTORY APPENDIX discriminate against any applicant, with respect to any aspect of a credit transaction— Equal Credit Opportunity Act (1) on the basis of race, color, religion, national (as amended March 23, 1976) origin, sex or marital status, or age (provided the TITLE V—PUBLIC LAW 93-495 applicant has the capacity to contract); (2) because all or part of the applicant's income Sec. derives from any public assistance program; or 502. Findings and purpose. (3) because the applicant has in good faith 503. Amendment to the Consumer exercised any right under the Consumer Credit Credit Protection Act. Protection Act. § 502. Findings and purpose (b) It shall not constitute discrimination for purposes of this title for a creditor— The Congress finds that there is a need to insure (1) to make an inquiry of marital status if such that the various financial institutions and other inquiry is for the purpose of ascertaining the credfirms engaged in the extensions of credit exercise itor's rights and remedies applicable to the partictheir responsibility to make credit available with ular extension of credit and not to discriminate fairness, impartiality, and without discrimination in a determination of creditworthiness; on the basis of sex or marital status. Economic (2) to make an inquiry of the applicant's age stabilization would be enhanced and competition or of whether the applicant's income derives from among the various financial institutions and other any public assistance program if such inquiry is firms engaged in the extension of credit would be for the purpose of determining the amount and strengthened by an absence of discrimination on probably continuance of income levels, credit histhe basis of sex or marital status, as well as by tory, or other pertinent element of creditthe informed use of credit which Congress has worthiness as provided in regulations of the Board; heretofore sought to promote. It is the purpose of (3) to use any empirically derived credit system this Act to require that financial institutions and which considers age if such system is demonother firms engaged in the extension of credit make strably and statistically sound in accordance with that credit equally available to all credit-worthy regulations of the Board, except that in the operacustomers without regard to sex or marital status. tion of such system the age of an elderly applicant § 503. Amendment to the Consumer Credit may not be assigned a negative factor or value; Protection Act or (4) to make an inquiry or to consider the age The Consumer Credit Protection Act (Public of an elderly applicant when the age of such Law 90-321), is amended by adding at the end applicant is to be used by the creditor in the thereof a new title VII: extension of credit in favor of such applicant. (c) It is not a violation of this section for a TITLE VII— creditor to refuse to extend credit offered pursuant EQUAL CREDIT OPPORTUNITY to— Sec. 701. Prohibited discrimination; reasons for ad- * Effective date for amendments to section 701 is March verse action. 23, 1977. All other amendments are effective upon enactment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-44 Federal Reserve Bulletin • January 1977 (1) any credit assistance program expressly the adverse action is taken, as determined under authorized by law for an economically disad- regulations of the Board. vantaged class of persons; (6) For purposes of this subsection, the term (2) any credit assistance program adminis- "adverse action" means a denial or revocation of tered by a nonprofit organization for its members credit, a change in the terms of an existing credit or an economically disadvantaged class of per- arrangement, or a refusal to grant credit in subsons; or stantially the amount or on substantially the terms (3) any special purpose program offered by requested. Such term does not include a refusal a profitmaking organization to meet special so- to extend additional credit under an existing credit cial needs which meets standards prescribed in arrangement where the applicant is delinquent or regulations by the Board; otherwise in default, or where such additional if such a refusal is required by or made pursuant credit would exceed a previously established credit to such program. limit. (d)(1) Within thirty days (or such longer rea- § 702. Definitions sonable time as specified in regulations of the Board for any class of credit transaction) after (a) The definitions and rules of construction set receipt of a completed application for credit, a forth in this section are applicable for the purposes creditor shall notify the applicant of its action on of this title. the application. (b) The term "applicant" means any person (2) Each applicant against whom adverse action who applies to a creditor directly for an extension, is taken shall be entitled to a statement of reasons renewal, or continuation of credit, or applies to for such action from the creditor. A creditor satis- a creditor indirectly by use of an existing credit fies this obligation by— plan for an amount exceeding a previously estab- (A) providing statements of reasons in writing lished credit limit. as a matter of course to applicants against whom (c) The term "Board" refers to the Board of adverse action is taken; or Governors of the Federal Reserve System. (B) giving written notification of adverse action (d) The term "credit" means the right granted which discloses (i) the applicant's right to a state- by a creditor to a debtor to defer payment of debt ment of reasons within thirty days after receipt or to incur debt and defer its payment or to by the creditor of a request made within sixty days purchase property or services and defer payment after such notification, and (ii) the identity of the therefor. person or office from which such statement may (e) The term "creditor" means any person who be obtained. Such statement may be given orally regularly extends, renews, or continues credit; any if the written notification advises the applicant of person who regularly arranges for the extension, his right to have the statement of reasons con- renewal, or continuation of credit; or any assignee firmed in writing on written request. of an original creditor who participates in the (3) A statement of reasons meets the require- decision to extend, renew, or continue credit. ments of this section only if it contains the specific (f) The term "person" means a natural person, reasons for the adverse action taken. a corporation, government or governmental subdi- (4) Where a creditor has been requested by a vision or agency, trust, estate, partnership, coopthird party to make a specific extension of credit erative, or association. directly or indirectly to an applicant, the notifica- (g) Any reference to any requirement imposed tion and statement of reasons required by this under this title or any provision thereof includes subsection may be made directly by such creditor, reference to the regulations of the Board under or indirectly through the third party, provided in this title or the provision thereof in question. either case that the identity of the creditor is § 703. Regulations disclosed. (5) The requirements of paragraph (2), (3), or (a) The Board shall prescribe regulations to (4) may be satisfied by verbal statements or notifi- carry out the purposes of this title. These regulacations in the case of any creditor who did not tions may contain but are not limited to such act on more than 150 applications during the classifications, differentiation, or other provision, calendar year preceding the calendar year in which and may provide for such adjustments and excep- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 45 tions for any class of transactions, as in the judg- Loan Insurance Corporation), in the case of any ment of the Board are necessary or proper to institution subject to any of those provisions. effectuate the purposes of this title, to prevent (3) The Federal Credit Union Act, by the Adcircumvention or evasion thereof, or to facilitate ministrator of the National Credit Union Adminisor substantiate compliance therewith. In particular, tration with respect to any Federal Credit Union. such regulations may exempt from one or more (4) The Acts to regulate commerce, by the of the provisions of this title any class of transac- Interstate Commerce Commission with respect to tions not primarily for personal, family, or house- any common carrier subject to those Acts. hold purposes, if the Board makes an express (5) The Federal Aviation Act of 1958, by the finding that the application of such provision or Civil Aeronautics Board with respect to any air provisions would not contribute substantially to carrier or foreign air carrier subject to that Act. carrying out the purposes of this title. Such regu- (6) The Packers and Stockyards Act, 1921 (exlations shall be prescribed as soon as possible after cept as provided in section 406 of that Act), by the date of enactment of this Act, but in no event the Secretary of Agriculture with respect to any later than the effective date of this Act. activities subject to that Act. (b) The Board shall establish a Consumer Advi- (7) The Farm Credit Act of 1971, by the Farm sory Council to advise and consult with it in the Credit Administration with respect to any Federal exercise of its functions under the Consumer land bank, Federal land bank association, Federal Credit Protection Act and to advise and consult intermediate credit bank, and production credit with it concerning other consumer related matters association. it may place before the Council. In appointing the (8) The Securities Exchange Act of 1934, by members of the Council, the Board shall seek to the Securities and Exchange Commission with achieve a fair representation of the interests of respect to brokers and dealers; and creditors and consumers. The Council shall meet (9) The Small Business Investment Act of 1958, from time to time at the call of the Board. Mem- by the Small Business Administration, with rebers of the Council who are not regular full-time spect to small business investment companies. employees of the United States shall, while at- (b) For the purpose of the exercise by any tending meetings of such Council, be entitled to agency referred to in subsection (a) of its powers receive compensation at a rate fixed by the Board, under any Act referred to in that subsection, a but not exceeding $100 per day, including travel violation of any requirement imposed under this time. Such members may be allowed travel ex- title shall be deemed to be a violation of a repenses, including transportation and subsistence, quirement imposed under that Act. In addition to while away from their homes or regular place of its powers under any provision of law specifically business. referred to in subsection (a), each of the agencies referred to in that subsection may exercise for the § 704. Administrative enforcement purpose of enforcing compliance with any re- (a) Compliance with the requirements imposed quirement imposed under this title, any other auunder this title shall be enforced under: thority conferred on it by law. The exercise of (1) Section 8 of the Federal Deposit Insurance the authorities of any of the agencies referred to Act, in the case of— in subsection (a) for the purpose of enforcing (A) national banks, by the Comptroller of the compliance with any requirement imposed under Currency; this title shall in no way preclude the exercise of (B) members banks of the Federal Reserve Sys- such authorities for the purpose of enforcing comtem (other than national banks), by the Board. pliance with any other provision of law not relating (C) banks insured by the Federal Deposit Insur- to the prohibition of dsicrimination on the basis ance Corporation (other than members of the Fed- of sex or marital status with respect to any aspect eral Reserve System), by the Board of Directors of a credit transaction. of the Federal Deposit Insurance Corporation. (c) Except to the extent that enforcement of the (2) Section 5(d) of the Home Onwers' Loan Act requirements imposed under this title is specifiof 1933, section 407 of the National Housing Act, cally committed to some other Government agency and sections 6(i) and 17 of the Federal Home Loan under subsection (a), the Federal Trade Commis- Bank Act, by the Federal Home Loan Bank Board sion shall enforce such requirements. For the pur- (acting directly or through the Federal Savings and pose of the exercise by the Federal Trade Com- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-46 Federal Reserve Bulletin • January 1977 mission of its functions and powers under the (e) Where the same act or omission constitutes Federal Trade Commission Act, a violation of any a violation of this title and of applicable State law, requirement imposed under this title shall be a person aggrieved by such conduct may bring a deemed a violation of a requirement imposed legal action to recover monetary damages either under that Act. All of the functions and powers under this title or under such State law, but not of the Federal Trade Commission under the Fed- both. This election of remedies shall not apply to eral Trade Commission Act are available to the court actions in which the relief sought does not Commission to enforce complicance by any person include monetary damages or to administrative with the requirements imposed under this title, actions. irrespective of whether that person is engaged in (f) This title does not annul, alter, or affect, commerce or meets any other jurisdictional tests or exempt any person subject to the provisions of in the Federal Trade Commission Act, including this title from complying with, the laws of any the power to enforce any Federal Reserve Board State with respect to credit discrimination, except regulation promulgated under this title in the same to the extent that those laws are inconsistent with manner as if the violation had been a violation any provision of this title, and then only to the of a Federal Trade Commission trade regulation extent of the inconsistency. The Board is authorrule. ized to determine whether such inconsistencies (d) The authority of the Board to issue regula- exist. The Board may not determine that any State tions under this title does not impair the authority law is inconsistent with any provision of this title of any other agency designated in this section to if the Board determines that such law gives greater make rules respecting its own procedures in en- protection to the applicant. forcing compliance with requirements imposed (g) The Board shall by regulation exempt from under this title. the requirements of sections 701 and 702 of this title any class of credit transactions within any § 705. Relation to State laws State if it determines that under the law of that (a) A request for the signature of both parties State that class of transactions is subject to reto a marriage for the purpose of creating a valid quirements substantially similar to those imposed lien, passing clear title, waiving inchoate rights under this title or that such law gives greater to property, or assigning earnings, shall not con- protection to the applicant, and that there is adestitute discrimination under this title: Provided, quate provision for enforcement. Failure to comply however, That this provision shall not be construed with any requirement of such State law in any to permit a creditor to take sex or marital status transaction so exempted shall constitute a violation into account in connection with the evaluation of of this title for the purposes of section 706. creditworthiness of any applicant. § 706. Civil liability (b) Consideration or application of State property laws directly or indirectly affecting credit- (a) Any creditor who fails to comply with any worthiness shall not constitute discrimination for requirement imposed under this title shall be liable the purposes of this title. to the aggrieved applicant for any actual damages (c) Any provision of State law which prohibits sustained by such applicant acting either in an the separate extension of consumer credit to each individual capacity or as a member of a class. party to a marriage shall not apply in any case (b) Any creditor, other than a government or where each party to a marriage voluntarily applies governmental subdivision or agency, who fails to for separate credit from the same creditor: Pro- comply with any requirement imposed under this vided, That in any case where such State law is title shall be liable to the aggrieved applicant for so preempted, each party to the marriage shall be punitive damages in an amount not greater than solely responsible for the debt so contracted. $10,000, in addition to any actual damages pro- (d) When each party to a marriage separately vided in subsection (a), except that in the case and voluntarily applies for and obtains separate of a class action the total recovery under this credit accounts with the same creditor, those ac- subsection shall not exceed the lesser of $500,000 counts shall not be aggregated or otherwise com- or 1 per centum of the net worth of the creditor. bined for purposes of determining permissible fi- In determining the amount of such damages in any nance charges or permissible loan ceilings under action, the court shall consider, among other relethe laws of any State or of the United States. vant factors, the amount of any actual damages Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 47 awarded, the frequency and persistence of failures unable to obtain compliance with section 701, are of compliance by the creditor, the resources of authorized to refer the matter to the Attorney the creditor, the number of persons adversely General with" a recommendation that an approaffected, and the extent to which the creditor's priate civil action by instituted. failure of compliance was intentional. (h) When a matter is referred to the Attorney (c) Upon application by an aggrieved applicant, General pursuant to subsection (g), or whenever the appropriate United States District court or any he has reason to believe that one or more creditors other court of competent jurisdiction may grant are engaged in a pattern or practice in violation such equitable and declaratory relief as is neces- of this title, the Attorney General may bring a civil sary to enforce the requirements imposed under action in any appropriate United States district this title. court for such relief as may be appropriate, in- (d) In the case of any successful action under cluding injunctive relief. subsection (a), (b), or (c), the costs of the action, (i) No person aggrieved by a violation of this together with a reasonable attorney's fee as deter- title and by a violation of section 805 of the Civil mined by the court, shall be added to any damages Rights Act of 1968 shall recover under this title awarded by the court under such subsection. and section 812 of the Civil Rights Act of 1968, (e) No provision of this title imposing any if such violation is based on the same transaction. liability shall apply to any act done or omitted (j) Nothing in this title shall be construed to in good faith in conformity with any official rule, prohibit the discovery of a creditor's credit grantregulation or interpretation thereof by the Board ing standards under appropriate discovery proceor in conformity with any interpretation or ap- dures in the court or agency in which an action proval by an official or employee of the Federal or proceeding is brought. Reserve System duly authorized by the Board to issue such interpretations or approvals under such § 707. Annual reports to Congress procedures as the Board may prescribe therefor, Not later than February 1 of each year after notwithstanding that after such act or omission has 1976, the Board and the Attorney General shall, occurred, such rule, regulation, interpretation, or respectively, make reports to the Congress conapproval is amended, rescinded, or determined by cerning the administration of their functions under judicial or other authority to be invalid for any this title, including such recommendations as the reason. Board and the Attorney General, respectively, (f) Any action under this section may be brought deem necessary or appropriate. In addition, each in the appropriate United States district court report of the Board shall include its assessment without regard to the amount in controversy, or of the extent to which compliance with the rein any other court of competent jurisdiction. No quirements of this title is being achieved, and a such action shall be brought later than two years summary of the enforcement actions taken by each from the date of the occurrence of the violation, of the agencies assigned administrative enforceexcept that— ment responsibilities under section 704. (1) whenever any agency having responsibility for administrative enforcement under § 708. Effective date section 704 commences an enforcement proceeding within two years from the date of the This title takes effect upon the expiration of one occurrence of the violation, year after the date of its enactment. The amend- (2) whenever the Attorney General com- ments made by the Equal Credit Opportunity Act mences a civil action under this section within Amendments of 1976 shall take effect on the date two years from the date of occurrence of the of enactment thereof and shall apply to any violaviolation, tion occurring on or after such date, except that then any applicant who has been a victim of the the amendments made to section 701 of the Equal discrimination which is the subject of such pro- Credit Opportunity Act shall take effect 12 months ceeding or civil action may bring an action under after the date of enactment. this section not later than one year after the com- § 709. Short title mencement of that proceeding or action. (g) The agencies having responsibility for ad- This title may be cited as the "Equal Credit ministrative enforcement under section 704, if Opportunity Act." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-48 Federal Reserve Bulletin • January 1977 APPENDIX A FEDERAL ENFORCEMENT AGENCIES The following list indicates which Federal agency enforces Regulation B for particular classes of creditors. Any questions concerning a particular creditor should be directed to its enforcement agency. National Banks Office of Proceedings Comptroller of the Currency Interstate Commerce Commission Consumer Affairs Division Washington, D.C. 20523 Washington, D.C. 20219 Creditors Subject to Packers and Stockyards State Member Banks Act Federal Reserve Bank serving the district in which Nearest Packers and Stockyards Administration the State member bank is located. area supervisor. Nonmember Insured Banks Small Business Investment Companies Federal Deposit Insurance Corporation Regional U.S. Small Business Administration Director for the region in which the nonmember 1441 L Street, N.W. insured bank is located. Washington, D.C. 20416 Savings Institutions Insured by the FSLIC and Brokers and Dealers Members of the FHLB System (except for Sav- Securities and Exchange Commission ings Banks insured by FDIC) Washington, D.C. 20549 The Federal Home Loan Bank Board Supervisory Federal Land Banks, Federal Land Bank Asso- Agency in the district in which the institution is ciations, Federal Intermediate Credit Banks located. and Production Credit Associations Federal Credit Unions Farm Credit Administration Regional office of the National Credit Union Ad- 490 L'Enfant Plaza, S.W. ministration serving the area in which the Federal Washington, D.C. 20578 credit union is located. Retail, Department Stores, Consumer Finance Creditors Subject to Civil Aeronautics Board Companies, All Other Creditors, and All Non- Director, Bureau of Enforcement bank Credit Card Issuers (Creditors operating Civil Aeronautics Board on a local or regional basis should use the address 1825 Connecticut Avenue, N.W. of the FTC Regional Office in which they operate) Washington, D.C. 20428 Federal Trade Commission Creditors Subject to Interstate Commerce Equal Credit Opportunity Commission Washington, D.C. 20580 APPENDIX B Board pursuant to the provisions of this Supple- Model application forms will be published in ment and the Board's Rules of Procedure (12 CFR the Regulation and will be available upon request 262) for a determination that, under the laws of from Publications Services, Division of Adminis- that State,1 a class of credit transactions2 within trative Services, Board of Governors of the Federal the State is subject to requirements that are sub- Reserve System, Washington, D.C. 20551. stantially similar to, or provide greater protection for applicants than, those imposed under sections SUPPLEMENT I 1 Any reference to State law in this Supplement includes a reference to any regulations that implement State law and Procedures and criteria under which a State may formal interpretations thereof by a court of competent jurisapply for an exemption pursuant to section 705(g) diction or duly authorized agency of that State. of the Act and section 202.11(e) of this Part, 2 As applicable, references to "class of credit transactions" in this Supplement include one or more such classes of credit (a) Application. Any State may apply to the transactions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 49 701 and 702 of the Act,3 and that there is adequate (i) administrative enforcement of the State provision for State enforcement of such require- law referred to in subsection (b)(1) that is subments. The application shall be in writing, ad- stantially similar to, or more extensive than, the dressed to the Board, signed by the Governor, enforcement provided under section 704 of the Attorney General, or State official having primary Act; enforcement or interpretive responsibilities under (ii) civil liability for a failure to comply with the State law that is applicable to the class of credit the requirements of the State law that is substantransactions, and shall be supported by the docu- tially similar to, or more extensive than, that ments specified in subsection (b). provided under section 706 of the Act, including (b) Supporting documents. The application class action liability and the ability of the State shall be accompanied by : Attorney General or other appropriate State official (1) A copy of the full text of the State law that to commence a civil action under circumstances is claimed to contain requirements substantially substantially similar to those prescribed in section similar to those imposed under sections 701 and 706 of the Act, except that such State law may 702 of the Act, or to provide greater protection provide a greater damage remedy or other, more to applicants that sections 701 and 702 of the Act, extensive remedies; regarding the class of credit transactions within (iii) a statute of liniitations that prescribes a that State. period for civil actions of substantially similar (2) A comparison of each provision of sections duration to that provided under section 706(f) of 701 and 702 of the Act with the corresponding the Act, or a longer period; and provision of the State law, together with reasons (iv) a scope of discovery relating to a credisupporting the claim that the corresponding provi- tor's credit granting standards under appropriate sions of the State law are substantially similar to, discovery procedures in a court action or agency or provide greater protection to applicants than, proceeding that is substantially similar to, or more provisions of sections 701 and 702 of the Act extensive than, that provided under section 706(j) regarding the class of credit transactions and ex- of the Act. plaining why any differences are not inconsistent (5) A statement identifying the office designated with the provisions of sections 701 and 702 of or to be designated to administer the State law the Act and do not result in a diminution in the referred to in subsection (b)(1), together with protection otherwise afforded applicants; and a complete information regarding the fiscal arrangestatement that no other State laws (including ad- ments for administrative enforcement (including ministrative or judicial interpretations) are related the amount of funds available or to be provided), to, or would have an effect upon, the State law the number and qualifications of personnel enthat is being considered by the Board in making gaged or to be engaged in enforcement, and a its determination. description of the procedures under which such (3) A copy of the full text of the State law that State law is to be administratively enforced, inprovides for enforcement of the State law referred cluding, if relevant, administrative enforcement to in subsection (b)(1). regarding Federally-chartered creditors.4 The (4) A comparison of the provisions of the State statement should also include reasons to support law that provides for enforcement with the provi- the claim that there is adequate provision for sions of sections 704 and 706 of the Act, together enforcement of such State law. with reasons supporting the claim that such State (c) Criteria for determination. The Board will law provides for: consider the criteria set forth below, and any other relevant information, in determining whether the 3 Any reference in this Supplement to sections 701 and 702 of the Act includes a reference to the corresponding and implementing provisions of this Part, the Board's formal inter- 4 Transactions within a State in which a Federally-chartered pretations thereof, and official interpretations or approvals institution is a creditor shall not be considered subject to issued by an authorized official or employee of the Federal exemption, and such Federally-chartered creditors shall remain Reserve System. Additionally, any reference to sections 701 subject to the requirements of the Act and administrative and 702 of the Act includes a reference to sections 705(a), enforcement by the appropriate Federal authority under section (b), (c), and (d) of the Act and the corresponding provisions 704 of the Act, unless a State establishes to the satisfaction of this Part, which, though technically not a part of sections of the Board that appropriate arrangements have been made 701 and 702, implement and relate to substantive requirements with such Federal authorities to assure effective enforcement of sections 701 and 702. of the requirements of State laws regarding such creditors. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-50 Federal Reserve Bulletin • January 1977 law of a State is substantially similar to, or pro- rights or gaining the benefits of the protections vides greater protection to applicants than, the provided in the State law than corresponding obliprovisions of sections 701 and 702 of the Act gations or responsibilities imposed on applicants regarding the class of transactions within that in sections 701 and 702 of the Act. State, and whether there is adequate provision for (vi) Applicants' rights and protections are State enforcement of such law. In making that substantially similar to, or more favorable than, determination, the Board primarily will consider those provided by sections 701 and 702 of the Act each provision of the State law in comparison with under conditions or within time periods that are each corresponding provision in sections 701 and substantially similar to, or more favorable to ap- 702 of the Act, and not the State law as a whole plicants than, those prescribed by sections 701 and in comparison with the Act as a whole. 702 of the Act. (1) In order for provisions of State law to be (2) In determining whether provisions for ensubstantially similar to, or provide greater protec- forcement of the State law referred to in subsection tion to applicants than, the provisions of sections (b)(1) are adequate, consideration will be given 701 and 702 of the Act, the provisions of State to the extent to which, under State law, provision law5 at least shall provide that: is made for: (i) Definitions and rules of construction, as (i) administrative enforcement, including applicable, import the same meaning and have the necessary facilities, personnel, and funding; same application as those prescribed by sections (ii) civil liability for a failure to comply with 701 and 702 of the Act. the requirement of such a State law that is sub- (ii) Creditors provide all of the applicable stantially similar to, or more extensive than, that notifications required by the provisions of sections provided under section 706 of the Act; 701 and 702 of the Act, with the content and in (iii) a statute of limitations for civil liability the terminology, form, and time periods prescribed of substantially similar or longer duration as that by this Part pursuant to sections 701 and 702; provided under section 706 of the Act; and however, required references to State law may be (iv) a scope of discovery relating to a credisubstituted for the references to Federal law re- tor's credit granting standards that is substantially quired in this Part. Notification requirements under similar to, or more extensive than, that provided State law in additional circumstances or with ad- under section 706(j) of the Act. ditional detail that do not frustrate any of the (d) Public notice of filing and proposed rule purposes of the Act may be determined by the making. In connection with any application that Board to be consistent with sections 701 and 702 has been filed in accordance with the requirements of the Act. of subsections (a) and (b) of this Supplement and (iii) Creditors take all affirmative actions and following initial review of the application, a notice abide by obligations substantially similar to or of such filing and proposed rule making shall be more extensive than those prescribed by sections published by the Board in the Federal Register, 701 and 702 of the Act under substantially similar and a copy of such application shall be made or more stringent conditions and within the same available for examination by interested persons or more stringent time periods as are prescribed during business hours at the Board and at the in sections 701 and 702 of the Act. Federal Reserve Bank for each Federal Reserve (iv) Creditors abide by the same or more District in which the State making the application stringent prohibitions as are prescribed by sections is situated. A period of time shall be allowed from 701 and 702 of the Act. the date of such publication for interested parties (v) Obligations or responsibilities imposed on to submit written comments to the Board regarding applicants are no more costly, lengthy, or burden- that application. some relative to applicants' exercising any of the (e) Exemption from requirements. If the Board determines on the basis of the information before it that, under the law of a State, a class of credit transactions is subject to requirements 5 This subsection is not to be construed as indicating that substantially similar to, or that provide greater the Board would consider adversely any additional require- protection to applicants than, those imposed under ments of State law that are not inconsistent with the purpose sections 701 and 702 of the Act and that there of the Act or the requirements imposed under sections 701 is adequate provision for State enforcement, the and 702 of the Act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 51 Board will exempt the class of credit transactions the application, the Board shall notify the approin that State from the requirements of sections 701 priate State official of the facts upon which such and 702 of the Act in the following manner and findings are based and shall afford that State ausubject to the following conditions: thority a reasonable opportunity to demonstrate or (1) Notice of the exemption shall be published achieve compliance. in the Federal Register, and the Board shall fur- (2) If, after having afforded the State authority nish a copy of such notice to the State official such opportunity to demonstrate or achieve comwho made application for such exemption, to each pliance, the Board finds on the basis of the infor- Federal authority responsible for administrative mation before it that it still cannot make a favorenforcement of the requirements of sections 701 able determination in connection with the applicaand 702 of the Act, and to the Attorney General tion, the Board shall publish in the Federal Regisof the United States. Additionally, the Board shall ter a notice of its determination regarding the include any exemption granted in an appropriate application and shall furnish a copy of such notice listing in Supplement II to this Part. Any exemp- to the State official who made application for such tion granted shall be effective 90 days after the exemption. date of publication of such notice in the Federal (g) Revocation of exemption. (1) The Board Register. reserve the right to revoke any exemption granted (2) The appropriate official of any State that under the provisions of this Supplement if at any receives an exemption shall inform the Board in time it determines that the State law does not, in writing within 30 days of any change in the State fact, impose requirements that are substantially laws referred to in subsections (b)(1) and (b)(3). similar to, or that provide greater protection to The report of any such change shall contain copies applicants than, those imposed under sections 701 of the full text of that change, together with and 702 of the Act or that there is not, in fact, statements setting forth the information and opin- adequate provision for State enforcement. ions regarding that change that are specified in (2) Before revoking any such exemption, the subsections (b)(2) and (b)(4). The appropriate of- Board shall notify the appropriate State official of ficial of any State that has received such an ex- the facts or conduct that, in the Board's opinion, emption also shall file with the Board from time warrants such revocation, and shall afford that to time such reports as the Board may require. State such opportunity as the Board deems appro- (3) The Board shall inform the appropriate offi- priate in the circumstances to demonstrate or cial of any State that receives such an exemption achieve compliance. of any subsequent amendments of the Act (includ- (3) If, after having been afforded the opportunity ing the implementing provisions of this Part, the to demonstrate or achieve compliance, the Board Board's formal interpretations, and interpretations determines that the State has not done so, notice or approvals issued by an authorized official or of the Board's intention to revoke such exemption employee of the Federal Reserve System) that shall be published as a notice of proposed rule might necessitate the amendment of State law for making in the Federal Register. A period of time the exemption to continue. shall be allowed from the date of such publication (4) No exemption shall extend to the adminis- for interested persons to submit written comments trative enforcement or civil liability provisions of to the Board regarding the proposed rule making. sections 704 and 706 of the Act. After an exemp- (4) If such exemption is revoked, notice of such tion if granted, the requirements of the applicable revocation shall be published by the Board in the State law shall constitute the requirements of sec- Federal Register, and a copy of such notice shall tions 701 and 702 of the Act, except to the extent be furnished to the appropriate State official, to such State law imposes requirements not imposed the Federal authorities responsible for enforcement by the Act or this Part. of the requirements of the Act, and to the Attorney General of the United States. The revocation shall (f) Adverse determination. (1) If, after publi- become effective, and the class of transactions cation of a notice in the Federal Register as affected within that State shall become subject to provided under section (d), the Board finds on the the requirements of sections 701 and 702 of the basis of the information before it that it cannot Act, 90 days after the date of publication of the make a favorable determination in connection with notice in the Federal Register. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-52 Federal Reserve Bulletin • January 1977 Reserves of Member Banks Regulation T (41 F.R. 5552) governing credit which a broker or dealer extends to option Spe- The Board of Governors has amended its Regucialists in a Specialists' account. The existing rule lation D to modify the provisions as to the reserve requires that credit terms to Specialists conform balances that member banks are required to mainto those available to public customers in a general tain on demand deposits. account with two exceptions. One exception is Effective as to the reserves required to be held applicable only if the account is that of a joint during the week commencing December 30, 1976, venture and it allows the broker carrying the acagainst deposits outstanding in the week beginning count to disregard any disproportionate sharing of December 16, 1976, §§ 204.5(a)(l)(iii) and (2) profits and losses when analyzing the amount of (iii) are amended to read as follows: credit being extended. The other exception allows the creditor to determine "in good faith" the Section 204.5—Reserve Requirements maximum loan value of any registered securities (a) Reserve Percentage. Pursuant to the provi- in the account rather than use the maximum loan sions of section 19 of the Federal Reserve Act value (currently 50 per cent) which the Board of and § 204.2(a) and subject to paragraph (c) of this Governors changes from time to time. section, the Board of Governors of the Federal The general account provision for the writing Reserve System hereby prescribes the following of options has been amended effective January 1, reserve balances that each member bank of the 1977 (41 F.R. 43895). In order to provide a Federal Reserve System is required to maintain sufficient period for the collection and analysis of on deposit with the Federal Reserve Bank of its comments on the proposed rule for Specialists' district. credit and to avoid the necessity for costly repro- (1) If not in a reserve city— gramming of computer systems until such time as the Board acts upon the proposed amendment to section 220.4(g), the Board has determined to (iii) (a) 7 per cent of its net demand deposits permit option Specialists to continue using the if its aggregate net demand deposits are $2 million existing provisions of section 220.3(d)(5) after or less, (b) $140,000 plus 9Vi per cent of its net January 1, 1977, instead of the new general acdemand deposits in excess of $2 million but less count provision which takes effect on that date. than $10 million, (c) $900,000 plus ll3/ 4 per cent The effect of this action is to permit, in calculating of its net demand deposits in excess of $10 million the adjusted debit balance of a Specialist's acif its aggregate net demand deposits are in excess count, the use of the amount of any margin custoof $10 million but less than $100 million, or (d) marily required by the creditor in connection with $11,475,000 plus 123A per cent of its net demand the issuance of the option, rather than the amount deposits in excess of $100 million. specified by the Board. (2) If in a reserve city (except as to any bank To implement this, the Board hereby tempolocated in such a city that is permitted by the Board rarily suspends the application of sections of Governors of the Federal Reserve System, pur- 220.3(d)(5) and (i) as such sections would apply suant to § 204.2(a)(2), to maintain the reserves after January 1, 1977 to transactions in options specified in subparagraph (1) of this paragraph)— in a Specialist's account within the scope of section 220.4(g) of Regulation T. (iii) $49,725,000 plus 16V4 per cent of its net Truth in Lending demand deposits in excess of $400 million. The Board of Governors has issued a supplement to its Regulation Z prescribing the criteria Credit by Brokers and Dealers and procedures under which a State may apply The Board of Governors, pursuant to authority for an exemption from the provisions of Chapter contained in Sections 7 and 23 of the Securities 4 (Credit Billing) of the Truth in Lending Act or Exchange Act of 1934, as amended (15 U.S.C. for a ruling regarding whether a provision of State 78g and w), proposed for comment on December law is inconsistent with a provision of Chapter 4 16, 1976, an amendment to section 220.4(g) of of the Act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 53 Effective December 10, 1976, Part 226 is 4 of the Act with respect to open end credit and amended by the addition of Supplement V to read credit card transactions as defined in § 226.2(x) as follows: of Regulation Z, including credit other than open end extended by use of a credit card. Supplement V to (2) A comparison of each requirement of State Regulation Z (Truth in Lending) law with the corresponding requirement of Chapter (Sections 226.12 & 226.6(b)(2)—Supplement) 4 of the Act, together with reasons to support the Section I claim that the requirements of State law are substantially similar to or provide greater protection Procedures and criteria under which any State to customers than requirements imposed under may apply for exemption from the provisions of Chapter 4 of the Act with respect to the class of Chapter 4 of the Truth in Lending Act pursuant credit transactions, and to demonstrate that any to paragraph (a) of § 226.12. differences are not inconsistent with and do not (a) Application—Any State may make appliresult in a diminution in the protection otherwise cation to the Board, pursuant to the terms of afforded customers by the requirements of Chapter Section I of this supplement and the Board's Rules 4 of the Act and a statement that there are no of Procedure (12 C.F.R. 262), for a determination other State laws which are related to or would have that under the laws of that State,1 transactions an effect upon the State law which is being conunder open end credit plans, including credit card sidered for exemption and which should be conplans, as provided in §§ 103(f) and (i) of the Act sidered by the Board in making its determination. and § 226.2(x) of this Part, within that State are (3) A copy of the full text of the laws of the subject to requirements which are substantially State which provide for enforcement of the State similar to those imposed under Chapter 4 of the laws referred to in subparagraph (1) of this para- Act2 or which provide greater protection to cusgraph. tomers than those provided under Chapter 4 of the (4) A comparison of the provisions of State law Act, and that there is adequate provision for enwith the provisions of §§ 108, 112, 130, 131, and forcement of such requirements. Such application 161(e) of the Act, together with reasons to support shall be made by letter addressed to the Board the claim that such State laws provide for: signed by the Governor, the Attorney General, or (i) Administrative enforcement of the State any official of the State having responsibilities laws referred to in subparagraph (1) of this paraunder the State laws which are applicable to the graph which is equivalent to the enforcement prorelevant class of transactions. The application shall vided under § 108 of the Act; be supported by the documents specified in para- (ii) Criminal liability for willful and knowing graph (b) of Section I of this supplement. violation of the State law with penalties substan- (b) Supporting Documents—The application tially similar to those prescribed under § 112 of shall be accompanied by: the Act, except that more severe penalties may (1) A copy of the full text of the laws of the be provided; State which are claimed by the applicant to impose (iii) Civil liability for failure to comply with requirements substantially similar to those imthe requirements of the State law, including class posed under Chapter 4 of the Act or to provide action liability, which is substantially similar to greater protection to customers than does Chapter that provided under §§ 130 and 131 of the Act, except that more severe penalties may be provided; (iv) A forfeiture penalty substantially similar to that provided by § 161(e) of the Act, except *Any reference to State law in Supplement V includes a reference to any regulations which implement State law and that a more severe forfeiture penalty may be proformal interpretations thereof by a court of competent juris- vided; diction or a duly authorized agency of that State. (v) A statute of limitations that prescribes a 2Any reference in Supplement V to Chapter 4 of the Act or any section thereof includes a reference to the implementing period with respect to civil liability actions of provisions of this Part and the Board's formal interpretations substantially similar duration as that provided thereof. Additionally, any reference to Chapter 4 of the Act under paragraph (e) of § 130 of the Act, except includes a reference to §§ 127(a)(8), 127(b)(ll), and 127(c) of Chapter 2 of the Act (and any implementing provisions in that a longer period may be provided. this Part) which, though technically a part of Chapter 2, (5) A statement identifying the office designated implement and relate to substantive requirements of Chapter 4. or to be designated to administer the State laws Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-54 Federal Reserve Bulletin • January 1977 referred to in subparagraph (1) of this paragraph, be changed so as to refer to State law. The text together with complete information regarding the of the statements required by State law which fiscal arrangements for administrative enforcement correspond to those required by §§ 226.7(a)(9), (including the amount of funds available or to be 226.7(d), and 226.7(i) of this Part must be varied provided), the number and qualifications of per- to accurately reflect the State law if there are any sonnel engaged therein, and a description of the differences between the State law and Chapter 4 procedures under which such State laws are to be which are determined by the Board not to be administratively enforced, including administra- inconsistent with Chapter 4 when granting any tive enforcement with respect to Federally char- exemption and which would affect the accuracy tered creditors.3 The foregoing statement should of the statement as provided in this Part; include reasons to support the claim that there is (iii) Creditors take all affirmative actions and adequate provision for enforcement of such State abide by obligations substantially similar to those laws. prescribed by Chapter 4 of the Act, under sub- (c) Criteria for Determination—The Board stantially similar conditions and within the same will consider the following criteria along with any (or more stringent) time periods as are prescribed other relevant information in making a determi- in Chapter 4 of the Act; nation of whether the laws of a State impose (iv) Creditors abide by the same (or more requirements substantially similar to or provide stringent) prohibitions as are provided by Chapter greater protection to customers than those require- 4 of the Act; ments imposed under Chapter 4 of the Act with (v) Customers need comply with no obligarespect to open end credit and credit card transac- tions or responsibilities which are more costly, tions, including credit other than open end extended lengthy, or burdensome as a condition of exercisby use of a credit card, and whether there is ing any of the rights or gaining the benefits of adequate provision for enforcement of such laws: the protections in the State law which correspond (1) In order for provisions of State law to be to those afforded by Chapter 4 of the Act, than substantially similar to or provide greater protec- those obligations or responsibilities imposed upon tion to customers than the provisions of Chapter customers in Chapter 4 of the Act; 4 of the Act, the provisions of State law4 shall (vi) Substantially similar or more favorable require that: rights and protections are provided to customers (i) Definitions and rules of construction, as under conditions substantially similar or more faapplicable, import the same meaning and have the vorable to customers than those afforded by Chapsame application as those prescribed under § 226.2 ter 4 of the Act. of this Part; (2) In determining whether the provisions for (ii) Creditors make all of the applicable dis- enforcement of the State law referred to in paraclosures required by this Part and deliver required graph (b)(1) are adequate, consideration will be notices in the form, content, terminology, and time given to the extent to which, under the laws of periods as prescribed by this Part; provided that the State, provision is made for: references to Federal law in the statement required (i) Administrative enforcement, including under §§ 226.7(a)(9), 226.7(d), and 226.7(i) may necessary facilities, personnel, and funding; (ii) Criminal liability for willful and knowing violation with penalties substantially similar to or more severe than those prescribed under § 112 of transactions within a State in which a Federally chartered institution is a creditor shall not be subject to the exemption, the Act; and such Federally chartered creditors shall remain subject to (iii) Civil liability for failure to comply with the requirements of the Act and administrative enforcement by the appropriate Federal authority under § 108 of the Act, the provisions of State law substantially similar unless it is established to the satisfaction of the Board that to that provided under §§ 130 and 131 and a appropriate arrangements have been made with such Federal forfeiture penalty substantially similar to that proauthorities to assure effective enforcement of the requirements of State laws with respect to such creditors. vided in § 161(e) of the Act, except that more severe civil liability and forfeiture penalties may 4This paragraph is not to be construed as indicating that the Board would consider adversely any additional require- be prescribed; and ments of State law which are not inconsistent with the purpose (iv) A statute of limitations with respect to of the Act or the requirements imposed under Chapter 4 of the Act. civil liability of substantially similar duration as Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 55 that provided under § 130 of the Act, except that Act (including the implementing provisions of this a longer duration may be provided. Part and the Board's formal interpretations) which (d) Public Notice of Filing and Proposed Rule might call for amendment of State law, regulations Making—In connection with any application or formal interpretation thereof. which has been filed in accordance with the re- (f) Adverse Determination—(1) If after publiquirements of paragraphs (a) and (b) of Section cation of notice in the Federal Register as provided I, following initial review of said application, under paragraph (d) the Board finds on the basis notice of such filing and proposed rule making will of the information before it that it cannot make be published by the Board in the Federal Register, a favorable determination in connection with the and a copy of such application will be made application, the Board will notify the appropriate available for examination by interested persons State official of the facts upon which such finding during business hours at the Board and at the is based and shall afford that State a reasonable Federal Reserve Bank of each Federal Reserve opportunity to demonstrate or achieve compliance. District in which any part of the State of the (2) If, after having afforded the State opportuapplicant is situated. A reasonable period of time nity to demonstrate or achieve compliance, the will be allowed from the date of such publication Board finds on the basis of the information before for the Board to receive written comments from it that it still cannot make any favorable determiinterested persons with respect to that application. nation in connection with the application, the (e) Exemption from Requirements of Chapter Board will publish in the Federal Register a notice 4—If the Board determines on the basis of the of its decision with respect to such application and information before it that under the law of a State will furnish a copy of such notice to the official open end credit and credit card transactions, in- who made application for such exemption. cluding credit transactions other than open end (g) Revocation of Exemption—(1) The Board extended by use of a credit card, are subject to reserves the right to revoke any exemption if at requirements which are substantially similar to or any time it determines that the State law does not, which provide greater protection to customers than in fact, impose requirements which are substanthose imposed under Chapter 4 of the Act and that tially similar to or provide greater protection to there is adequate provision for enforcement, the customers than those imposed under Chapter 4 of Board will exempt such class of transactions in the Act or that there is not, in fact, adequate that State from the requirements of Chapter 4 of provision for enforcement. the Act in the following manner and subject to (2) Before revoking any State exemption, the the following conditions: Board will notify the appropriate State official of (1) Notice of the exemption will be published the facts or conduct which in the opinion of the in the Federal Register, and the Board will furnish Board warrant such revocation and shall afford that a copy of such notice to the official who made State such opportunity as the Board deems approapplication for such exemption and to each Federal priate in the circumstances to demonstrate or authority responsible for administrative enforce- achieve compliance. ment of the requirements of Chapter 4 of the Act. (3) If, after having been afforded the opportu- (2) The appropriate official of any State which nity to demonstrate or achieve compliance, the receives an exemption shall inform the Board Board determines that the State has not done so, within 30 days of the occurrence of any change notice of the Board's intention to revoke such in its related law (including regulations). The exemption shall be published as a notice of proreport of any such change shall contain copies of posed rule making in the Federal Register. A the full text of that change together with statements period of time will be allowed from the date of setting forth the information and opinions with such publication for the Board to receive written respect to that change as specified in subparagraphs comments from interested persons with respect to (2) and (4) of paragraph (b). The appropriate the proposed rule making. official of any State which has received an exemp- (4) In the event of revocation of such exemption shall file with the Board from time to time tion, notice of such revocation shall be published such reports as the Board may require. by the Board in the Federal Register, and a copy (3) The Board will inform the appropriate offi- of such notice shall also be furnished to the apcial of any State which receives an exemption of propriate State official and to the Federal authoriany subsequent amendments of Chapter 4 of the ties responsible for enforcement of requirements Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-56 Federal Reserve Bulletin • January 1977 of Chapter 4 of the Act, and the class of transac- sion of Chapter 4 of the Act is not clearly covered tions affected within that State shall then be subject by the standards and criteria set forth in § 226.6(b) to the requirements of Chapter 4 of the Act and of this Part. subject to administrative enforcement as provided (3) A copy of the full text of any provisions under § 108 of the Act. of State law corresponding to §§ 112, 130, 131, and 161(e) (if applicable) together with reasons Section II for applicant's claim that such State provisions are Procedures and criteria under which any State not inconsistent (because they provide greater may apply for a determination that a State law protection to customers or for other reasons) with is not inconsistent with and not preempted by a the Act. provision of Chapter 4 of the Act pursuant to § (4) A statement that there are no State laws 226.6(b)(2) of this Part. (including administrative or judicial interpreta- (a) Application—Any State may make applica- tions) other than those submitted to the Board tion to the Board pursuant to the terms of Section which have any bearing on whether or not the State II of this supplement and the Board's Rules of law is consistent with a provision of Chapter 4 Procedure (12 C.F.R. 262), for a determination of the Act. that a law of such State is consistent5 with a (5) A statement identifying the office designated provision of Chapter 4 of the Act, because such or to be designated to administer the State laws State law provides greater protection to customers referred to in subparagraph (1) of this paragraph. than does the provision of Chapter 4 of the Act, If no such administrative office exists, then a that such law is consistent with a provision of statement identifying the office to which the Board Chapter 4 for any other reasons, or for a determi- can address any correspondence regarding the renation of any issues not clearly covered by § quest for such determination shall accompany the 226.6(b) with regard to the relationship of the application. Federal law to the State's law. Such application (c) Criteria for Determination—The Board shall be made by letter addressed to the Board will consider the following criteria along with any signed by the Governor, Attorney General, or any other relevant information, in addition to the criofficial of the State having responsibilities under teria set forth in § 226.6(b) of this Part, in making the State law put forward for consideration and a determination of whether or not State law is supported by the documents specified in paragraph inconsistent with a provision of Chapter 4 of the (b) of Section II of this supplement. Act. In order for provisions of State law to be (b) Supporting Documents—The application determined to be consistent with a provision of shall be accompanied by: Chapter 4 of the Act, the provisions of State law6 (1) A copy of the full text of the laws of the shall, to the extent relevant to the determination, State which are claimed by the applicant to be require that: consistent with a provision of Chapter 4 of the (1) Definitions and rules of construction, as Act or whose relationship (with regard to consist- applicable, import the same meaning and have the ency or inconsistency) to a provision of Chapter same application as those prescribed by this Part; 4 of the Act is claimed by the applicant to be (2) Creditors make all of the applicable disclonot clearly covered by the standards and criteria sures required by the corresponding provision of for comparison set forth in § 226.6(b) of this Part. Chapter 4 of the Act and this Part and deliver (2) A comparison of each requirement of the required notices with the content and in the termi- State law with the corresponding requirement of nology, form, and time periods prescribed by this Chapter 4 of the Act, together with reasons to Part; however, variations in form, content, and support the claim that the State law is consistent terminology from the disclosures required by this with a provision of Chapter 4 of the Act or that Part will be permitted in order to accurately reflect the relationship (with regard to consistency or inconsistency) between the State law and a provi- 6 This paragraph is not to be construed as indicating that the Board would consider adversely any additional require- 5For purposes of this supplement the terms "consistent" ments of State law which are not inconsistent with the purand "not inconsistent" shall convey the same meaning and poses of the Act or the requirements imposed under Chapter shall involve the same evidentiary showing. 4 of the Act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 57 a State law which is different from the Federal (e) Determination that a State Law is Conlaw but determined to be consistent therewith, and sistent with Chapter 4—If the Board determines more frequent disclosures which do not frustrate on the basis of the information before it that the any of the purposes of the Act may be determined law of a State is consistent with a provision of to be consistent with the Act; Chapter 4 of the Act, notice of such determination (3) Creditors take all affirmative actions and shall be published in the following manner and abide by obligations substantially similar to those shall be subject to the following conditions: prescribed by a provision of Chapter 4 of the Act (1) Notice of the determination will be pubunder substantially similar (or more stringent) lished in the Federal Register, and the Board will conditions and within the same (or more stringent) furnish a copy of such notice to the official who time periods as are prescribed in Chapter 4 of the made application for such exemption and to each Act; Federal authority responsible for administrative (4) Creditors abide by the same (or more strin- enforcement of the requirements of Chapter 4 of gent) prohibitions as are prescribed by the corre- the Act. sponding provision of Chapter 4 of the Act; (2) The appropriate official of any State which (5) Customers need comply with obligations or receives such a determination shall inform the responsibilities which are not more costly, Board within 30 days of the occurrence of any lengthy, or burdensome as a condition of exercis- change in its related law (or regulations). The ing any of the rights or gaining the benefits of report of any such change shall contain copies of the protections provided in the State law, which the full text of the law, as changed, together with correspond to those afforded by Chapter 4 of the statements setting forth the information and opin- Act, than those obligations or responsibilities im- ions with respect to that change as specified in posed on customers in Chapter 4 of the Act; subparagraphs (2) and (4) of paragraph (b) of (6) Customers are to have rights and protections Section II. The appropriate official of any State substantially similar to or more favorable than which has received such a determination shall file those provided by the corresponding provision of with the Board from time to time such reports as Chapter 4 of the Act under conditions and within the Board may require. time periods which are substantially similar to or (3) The Board will inform the appropriate offimore favorable to customers than those prescribed cial of any State which receives such a determiby Chapter 4 of the Act.7 nation of any subsequent amendments of Chapter (d) Public Notice of Filing and Proposed Rule 4 of the Act (including the implementing provi- Making—In connection with any application sions of this Part and the Board's formal interprewhich has been filed in accordance with the re- tations) which might call for amendment of State quirements of paragraphs (a) and (b) of Section law, regulations, or formal interpretations. II of this supplement, notice of such filing and (f) Adverse Determination—(1) If after publiproposed rule making will be published by the cation of notice in the Federal Register as provided Board in the Federal Register, and a copy of such under paragraph (d) the Board finds on the basis application will be made available for examination of the information before it that such State law by interested persons during business hours at the is inconsistent with a provision of Chapter 4 of Board and at the Federal Reserve Bank of each the Act, the Board will notify the appropriate State Federal Reserve District in which any part of the official of the facts upon which such finding is State of the applicant is situated. A period of time based and shall afford that State authority a reawill be allowed from the date of such publication sonable opportunity to demonstrate further that for the Board to receive written comments from such State law is not inconsistent with the correinterested persons with respect to that application. sponding provision of Chapter 4 of the Act, if such State authority desires to do so. (2) If, after having afforded the State authority 7 A State may make a showing that in certain limited readily such further opportunity to demonstrate that the identifiable circumstances a law which may otherwise be in- State law is consistent with a provision of Chapter consistent with a provision of Chapter 4 of the Act is not 4 of the Act, the Board finds on the basis of the inconsistent under the criteria set forth in paragraph (c) of Section II of this supplement. The Board may determine such information before it that the State law is incon- State law to be consistent only under those circumstances but sistent, the Board will publish in the Federal will make no such determination if doing so would mislead Register a notice of its decision with respect to or confuse customers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-58 Federal Reserve Bulletin • January 1977 such application and will furnish a copy of such the Board pursuant to the Financial Institutions notice to the official who made application for the Supervisory Act, 12 U.S.C. §§ 1818(b) and (c) determination. (§§ 8(b) and (c) of the Federal Deposit Insurance (g) Reversal of Determination—(1) The Board Act.) reserves the right to reverse any determination Effective December 16, 1976, 12 CFR Part 265 made under Section II of this supplement to the is amended by adding thereto a new § 265. la(b)(2) effect that a State law is consistent with a provision to read as follows: of Chapter 4 of the Act, if at any time it determines Section 265.1a—Specific that the State law is in fact inconsistent with a Functions Delegated to Board Members provision of Chapter 4 of the Act because of subsequently discovered facts, a change in the State or Federal law (by amendment or administrative or judicial interpretation or otherwise) or (b) Any Board members designated by the for any other reason bearing on the coverage or Chairman is authorized: impact of the State or Federal law. (2) Before reversing any such determination, the Board will notify the appropriate State official (2) To approve, after receiving the recomof the facts or conduct which, in the opinion of mendations of the Director of the Division of the Board, warrant such reversal and shall afford Banking Supervision and Regulation and the Genthat State such opportunity as the Board deems eral Counsel, amendments to any notice of appropriate in the circumstances to demonstrate charges, proposed order to cease and desist, or that the determination should not be reversed. temporary cease-and-desist order, previously ap- (3) If, after having been afforded the opportu- proved by the Board of Governors pursuant to the nity to demonstrate that its law is consistent with Financial Institutions Supervisory Act, 12 U.S.C. a provision of Chapter 4 of the Act, the Board §§ 1818(b), (c) (Federal Deposit Insurance Act, determines that the State has not done so, notice §§ 8(b) and (c)). of the Board's intention to reverse such determination shall be published as a notice of proposed rule making in the Federal Register. A reasonable The Board of Governors has also amended its period of time will be allowed from the date of Rules Regarding Delegation of Authority to delesuch publication for the Board to receive written gate to the General Counsel of the Board the comments from interested persons with respect to authority to make certifications (prior and final) the proposed rule making. for Federal tax purposes with respect to distri- (4) In the event of reversal of such determi- butions and divestitures pursuant to the Bank nation, notice of such reversal shall be published Holding Company Act Amendments of 1970. by the Board in the Federal Register, and a copy Effective December 6, 1976, 12 CFR Part 265 of such notice shall also be furnished to the ap- is amended by revising § 265.2(b)(3) to read as propriate State official and to the Federal authori- follows: ties responsible for enforcement of the require- Section 265.2—Specific ments of Chapter 4 of the Act, and the State law Functions Delegated to Board affected shall then be considered inconsistent with and preempted by Chapter 4 of the Act within the Employees and to Federal Reserve Banks meaning of § 171(a) of the Act. (b) The General Counsel of the Board (or, Rules Regarding Delegation of Authority in the General Counsel's absence, the Acting The Board of Governors of the Federal Reserve General Counsel) is authorized: System has amended its Rules Regarding Delegation of Authority to delegate to any member of the Board designated by the Chairman the author- (3) Under the provisions of sections 1101-1103 ity to approve amendments to notices of charges, and section 6158 of the Internal Revenue Code proposed orders to cease and desist, and temporary (26 U.S.C. 1101-1103 and 6158) to make certificease-and-desist orders, previously approved by cations (prior and final) for Federal tax purposes Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 59 with respect to distributions and divestitures pur- ownership in a foreign bank as long as such foreign suant to the Bank Holding Company Act. bank is "not engaged, directly or indirectly, in any activity in-the United States except as, in the judgment of the Board . . . shall be incidental to the international or foreign business of such Interpretation of Regulations K, M and Y foreign bank." Finally, Section 4(c)(13) of the In a request for an interpretation filed with the Bank Holding Company Act exempts from the Board by a member bank and its parent bank nonbanking prohibitions of Section 4 of the Act holding company, the issue arose whether it would "shares of, or activities conducted by, any combe a permissible activity for one of their existing pany which does no business in the United States foreign subsidiary corporations, subject to the except as an incident to its international or foreign provisions of either Sections 25 or 25(a) of the business." Federal Reserve Act or Section 4(c)(13) of the In the Board's judgment, the slight wording Bank Holding Company Act, to sell long-term differences between the quoted portions of the debt obligations in foreign markets and to transfer above statutes were not intended by Congress to the proceeds of these obligations to its United bear any meaningful significance. Accordingly, States parent(s) for domestic purposes. the Board has interpreted these provisions in the Under the specific proposal put forward, a past as being synonymous2 and this interpretation foreign subsidiary of the parent bank holding applies to each of the above statutory provisions. company would sell debt obligations in foreign To the extent that the foreign subsidiary in markets, which obligations would have initial ma- question is involved in the issuance of long-term turities in excess of seven years and may or may debt obligations in foreign markets, there is no not be supported by the guaranty of its parent bank legal issue raised since that subsidiary would holding company. The foreign subsidiary in ques- clearly be engaging in permissible foreign activition would have substantial other international or ties. However, an issue is raised whether the foreign business and would be performing an ac- transfer of the proceeds of those obligations to its tivity that its parent bank holding company could parent institution causes such foreign subsidiary perform directly, i.e., raising capital funds through to be "doing" or "transacting" business within the sale of long-term debt obligations. the United States in violation of the statutory Under the eighth paragraph of Section 25(a) of provisions set forth above. the Federal Reserve Act (12 U.S.C. 615), an Edge The Board has determined that the foreign sub- Corporation may, with the prior consent of the sidiary in question is not "transacting" or Board, purchase and hold stock of a corporation "doing" business in the United States by the mere that is "not engaged in the general business of transfer of proceeds of its long-term foreign debt buying or selling goods, wares, merchandise or obligations to its parent corporation. In the Board's commodities in the United States, and not trans- judgment, the foreign subsidiary is essentially acting any business in the United States except providing a service to its parent in that it is serving such as in the judgment of the Board . . . may as its parent's alter ego for the limited purpose be incidental to its international or foreign busi- of obtaining long-term funds that the parent could ness." Similarly, under the tenth paragraph of the otherwise obtain directly.3 The transfer of borsame section, an Edge Corporation shall not rowing proceeds between a United States parent "carry on any part of its business in the United States except such as in the judgment of the Board . . . may be incidental to its international or foreign ^See section 225.4(f)(1) of Regulation Y, wherein the Board business." Pursuant to the third paragraph of Sechas by regulation applied to foreign subsidiaries of domestic tion 25 of the Federal Reserve Act, a national bank holding companies the Edge Act limitations on activities banking association1 may acquire and hold, di- in the United States. 3 While such a foreign subsidiary may be viewed as providing rectly or indirectly, stock or other evidences of a service to its parent bank holding company, the Board nevertheless believes that any bank holding company that plans to acquire shares of a foreign corporation to engage solely in the activities described herein will have to file an application Paragraph 20 of Section 9 of the Federal Reserve Act (12 under § 4(c)(13) of the Bank Holding Company Act and § U.S.C. 335) makes the provisions of Section 25 applicable 225.4(f) of Regulation Y. (See in this regard the Board's prior to State member banks. ruling on foreign operations subsidiaries at 12 CFR 250.143.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-60 Federal Reserve Bulletin • January 1977 and its foreign subsidiary in this situation can thus accident and health insurance directly or indirectly be viewed as not more than an intra-organizational with the company. Such credit-related insurance transaction for the parent's benefit. In the Board's placed with the company would be identified in view, such a transaction is distinguishable from the records of the company as having been origia commerical loan to a third-party United States nated by the respective stockholder. A separate resident by a foreign subsidiary, which loan would capital account would be maintained for each bring a foreign subsidiary into direct lending com- stockholder consisting of the original capital conpetition with domestic banking organizations. tribution increased or decreased from time to time In the Board's judgment, this interpretation ap- by the net profit or loss resulting from the insurplies only to a situation where a foreign subsidiary ance business attributable to each stockholder. acting strictly on behalf of its parent organization, Thus, each stockholder would receive a return on issues debt obligations abroad for the sole and its investment based upon the claims experience express purpose of supplying funds to its parent and profitability of the insurance business that it organization. To meet this test, the Board believes had itself generated. Dividends declared by the three conditions must be satisfied: (1) the foreign board of directors of the company would be paysubsidiary should be wholly-owned (except for able to each stockholder only out of the earned directors' qualifying shares, if any) by its United surplus reflected in the respective stockholder's States parent organization(s); (2) the proceeds re- captial account. patriated should be no greater in amount than the It has been requested that the Board issue an amount of debt issued abroad; and (3) the proceeds interpretation that § 4(c)(6) of the Act provides should be repatriated on approximately the same an exemption under which participating bank terms and conditions as the obligations issued by holding companies may acquire such interests in the foreign subsidiary. the company without prior approval of the Board. On the basis of a careful review of the docu- Interpretation of Regulation Y ments submitted, in light of the purposes and provisions of the Act, the Board has concluded The Board has received a request for an interthat § 4(c)(6) of the Act is inapplicable to this pretation of § 4(c)(6) of the Bank Holding Comproposal and that a bank holding company must pany Act ("Act")* in connection with a proposal obtain the approval of the Board before particiunder which a number of bank holding companies pating in such a proposal in the manner described. would purchase interests in an insurance company The Board's conclusion is based upon the followto be formed for the purpose of underwriting or ing considerations: reinsuring credit life and credit accident and health (1) Section 2(a)(2)(A) of the Act provides that insurance sold in connection with extensions of a company is deemed to have control over a second credit by the stockholder bank holding companies company if it owns or controls "25 per centum and their affiliates. or more of any class of voting securities" of the Each participating holding company would own second company. In the case presented, the stock no more than 5 per cent of the outstanding voting interest of each participant would be evidenced by shares of the company. However, the investment a different class of stock and each would, accordof each holding company would be represented ingly, own 100 per cent of a class of voting by a separate class of voting security, so that each securities of the company. Thus, each of the stockholder would own 100 per cent of its respecstockholders would be deemed to "control" the tive class. The participating companies would excompany and prior Board approval would be reecute a formal "Agreement Among Stockholders" quired for each stockholder's acquisition of stock under which each would agree to use its best in the company. efforts at all times to direct or recommend to The Board believes that this application of § customers and clients the placement of their life, 2(a)(2)(A) of the Act is particularly appropriate on the facts presented here. The company is, in practical effect, a conglomeration of separate business ventures each owned 100 per cent by a * Section 4(c)(6) of the Act provides an exemption from the Act's prohibitions on ownership of shares in nonbanking com- stockholder the value of whose economic interest panies for '' shares of any company which do not include more in the company is determined by reference to the than 5 per centum of the outstanding voting shares of such profits and losses attributable to its respective class company." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 61 of stock, Furthermore, it is the Board's opinion unqualified grant of permission to a bank holding that this application of § 2(a)(2)(A) is not incon- company to own 5 per cent of the shares of any sistent with § 4(c)(6). Even assuming that § 4(c)(6) nonbanking company, irrespective of the nature is intended to refer to all outstanding voting shares, or extent of the holding company's participation and not merely the outstanding shares of a partic- in the affairs of the nonbanking company would, ular class of securities, § 4(c)(6) must be viewed in the Board's view, create the potential for serious as permitting ownership of 5 per cent of a com- and widespread evasion of the Act's controls over pany's voting stock only when that ownership does nonbanking activities. Such a construction would not constitute "control" as otherwise defined in allow a group of 20 bank holding companies—or the Act. For example, it is entirely possible that even a single bank holding company and one or a company could exercise a controlling influence more nonbank companies—to engage in entreover the management and policies of a second preneurial joint ventures in businesses prohibited company, and thus "control" that company under to bank holding companies, a result the Board the Act's definitions, even though it held less than believes to be contrary to the intent of Congress. 5 per cent of the voting stock of the second In this proposal, each of the participating stockcompany. To view § 4(c)(6) as an unqualified holders must be viewed as engaging in the business exemption for holdings of less than 5 per cent of insurance underwriting. Each stockholder would thus create a serious gap in the coverage would agree to channel to the company the insurof the Act. ance business it generates, and the value of the (2) The Board believes that § 4(c)(6) should interest of each stockholder would be determined properly be interpreted as creating an exemption by reference to the profitability of the business from the general prohibitions in § 4 on ownership generated by that stockholder itself. There is no of stock in nonbank companies only for passive sharing or pooling among stockholders of uninvestments amounting to not more than 5 per cent derwriting risks assumed by the company, and of a company's outstanding stock, and that the profit or loss from investments is allocated on the exemption was not intended to allow a group of basis of each bank holding company's allocable holding companies, through concerted action, to underwriting profit or loss. The interest of each engage in an activity as entrepreneurs. Section 4 stockholder is thus clearly that of an entrepreneur of the Act, of course, prohibits not only owning rather than that of an investor. stock in nonbank companies, but engaging in Accordingly, on the basis of the factual situation activities other than banking or those activities before the Board, and for the reasons summarized permitted by the Board under § 4(c)(8) as being above, the Board has concluded that § 4(c)(6) of closely related to banking. Thus, if a holding the Act cannot be interpreted to exempt the owncompany may be deemed to be engaging in an ership of 5 per cent of the voting stock of a activity through the medium of a company in company under the circumstances described, and which it owns less than 5 per cent of the voting that a bank holding company wishing to become stock it may nevertheless require Board approval, a stockholder in a company under this proposal despite the § 4(c)(6) exemption. would be required to obtain the Board's approval To accept the argument that § 4(c)(6) is an to do so. BANK HOLDING COMPANY AND BANK MERGER ORDERS ISSUED BY THE BOARD OF GOVERNORS Orders Under Section 3 S.A., Caracas, Venezuela ("Consorcio Finanof Bank Holding Company Act ciero"); and Union International Corporation, Wilmington, Delaware ("Union International") Banco Union, C.A.; Consorcio Financiero have applied for the Board's approval under § Union, S.A. and Union International Corp., 3(a)(1) of the Bank Holding Company Act (12 Caracas, Venezuela U.S.C. § 1842(a)(1)) of formation of bank holding companies through acquisition directly or indi- Order Approving rectly of all of the voting shares (less director's Formation of Bank Holding Companies qualifying shares) of Union Chelsea National Banco Union, C.A., Caracas, Venezuela Bank, New York, New York ("Bank"). Bank, ("Banco Union"); Consorcio Financiero Union, a new bank recently chartered by the Comptroller Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-62 Federal Reserve Bulletin • January 1977 of the Currency, proposes to purchase assets and United States company that has been formed for assume liabilities of Chelsea National Bank, New the purpose of holding the shares of Bank. Upon York, New York ("Chelsea Bank").1 Bank would acquisition of Bank (deposits of approximately $28 be the successor to Chelsea Bank and, accord- million), Applicants would control 0.2 per cent ingly, the proposed acquisition of voting shares of deposits in commercial banks in the State of of Bank is treated herein as the proposed acquisi- New York.4 tion of the voting shares of Chelsea Bank. Union Chelsea Bank, whose assets and liabilities are International proposes to acquire all of the voting to be acquired by Bank, is the 78th largest of 122 shares of Bank. Banco Union would own 10 per banking organizations in the relevant market.5 cent of the shares of Union International; however, Because of the nature of the business conducted as a result of a voting agreement entered into with at Banco Union's New York agency and the large Consorcio, it would have the power to vote an number of intervening banks, it does not appear additional 15 per cent of the shares of Union that any meaningful competition would be elimi- International.2 Consorcio Financiero would own nated as a result of the proposals. On the other 90 per cent of the shares of Union International,3 hand, consummation of the proposals should have but as a result of the voting agreement would have a salutary effect on competition by restoring Chelthe power to vote only 75 per cent of Union sea Bank to a condition whereby it will be able International shares. to compete with other banking organizations in the Notice of the applications has been given to the market. On the basis of the record, the Board Comptroller of the Currency in accordance with concludes that consummation of the proposals § 3(b) of the Act. The Comptroller has recom- would not have a significant adverse effect on mended approval of the applications. Published existing or potential competition in any relevant notice of the applications has been dispensed with area and that competitive considerations are conbecause of the emergency situation that exists. sistent with approval of the applications. Such notice is not required by the Act. The Board The financial and managerial resources and fuhas considered the applications and the comments ture prospects of Banco Union are regarded as received in the light of the factors set forth in § generally satisfactory. Similar considerations with 3(c) of the Act (12 U.S.C. § 1842(c)). respect to Consorcio Financiero and Union Inter- Banco Union, a Venezuelan commercial bank national appear to be consistent with approval of with total assets of approximately $1.1 billion and the subject applications. Bank's financial resources total deposits of approximately $1 billion, is the and future prospects, absent consummation of the second largest commercial bank in Venezuela. instant proposals, are unsatisfactory and additional Banco Union has 82 offices located throughout funds are needed in order for Bank to be able to Venezuela and has two overseas offices, including continue its operations. In this connection, Banco an agency in New York City. Consorcio Finan- Union has agreed to directly or indirectly inject ciero is a holding company with substantially the $6 million of additional capital into Bank. In same shareholders as Banco Union and was addition, Banco Union will make a $6 million line formed to hold interests in mortgage banking and of credit available to Union International to enable other companies formerly held by Banco Union. Union International to make such additional capital Consorcio Financiero has total assets of approxi- investments in Bank as may be necessary. Thus, mately $12.7 million. Union International is a banking factors lend weight toward approval of the applications. Although there will be no imme- 1 The Comptroller has declared that an emergency exists with respect to the condition of Chelsea Bank and, acting pursuant 4All banking data are as of December 31, 1975, unless to 12 U.S.C. section 181, waived the requirement that the otherwise indicated. owners of two-thirds of Chelsea Bank's stock vote to approve 5The metropolitan New York market, the relevant geothe transaction. graphic market for purposes of analyzing the competitive 2Banco Union has undertaken to apply to the proper Vene- effects of the subject proposal, is defined to include the five zuelan authorities for permission to acquire all of the shares boroughs of New York City, Nassau County, Westchester of Union International. County, Putnam County, Rockland County, and western Suf- 3 Both Banco Union and Consorcio Financiero have agreed folk County in New York, as well as the northern two-thirds to maintain the voting agreement regarding 15 per cent of the of Bergen County and eastern Hudson County in New Jersey, shares of Union International, until the Board consents to plus southwestern Fairfield County in Connecticut. Chelsea termination of the arrangement. Bank's rank in the market is as of June 30, 1975. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 63 diate change or increase in the services offered While Banco Union and Consorcio Financiero by Bank, consummation of the proposed transac- are primarily engaged in activities outside the tions would preserve Bank as an alternative source United States, Banco Union presently owns 39 per of banking services. Thus, convenience and needs cent, and Consorcio Financiero owns 45 per cent, considerations lend significant weight toward ap- of the voting shares of Administradora Union, a proval of the applications. Accordingly, it is the Venezuelan company which indirectly engages in Board's judgment that consummation of the pro- real estate management activities in the United posed transaction would be in the public interest States through its wholly-owned subsidiary Adand that the applications should be approved. ministradora Union Management Corp., Coral Pursuant to section 4(a)(2) of the Act, Appli- Gables, Florida ("Management Company"). It cants would have two years from the date on which does not appear that any of the exemptive provithey become bank holding companies in which to sions of section 4 of the Act, including § 4(c)(9), divest direct or indirect ownership or control of are applicable to Applicants' indirect investments any companies engaged in impermissible non- in Management Company. In accordance with banking activities. Under section 4(c)(9) of the Act section 4(a)(2) of the Act, Banco Union and Conand section 225.4(g) of Regulation Y [12 CFR sorcio Financiero have agreed to, within two years 225.4(g)] issued pursuant thereto, a "foreign bank from the date on which they become bank holding holding company," as defined in the regulation,6 companies, either divest their ownership of shares is eligible for certain exemptions from the non- of Management Company or Management Combanking prohibitions of the Act. Specifically, a pany will cease its United States activities. foreign bank holding company may, without the On the basis of the record, the applications are Board's prior specific consent, retain and acquire approved for the reasons summarized above. The shares of any company that is not engaged, directly transactions shall not be made (a) before the thiror indirectly, in any activities in the United States tieth calendar day following the effective date of except as shall be incidental to the international this Order or (b) later than three months after the or foreign business of such company. It appears effective date of this Order, unless such period that Banco Union would qualify as a foreign bank is extended for good cause by the Board, or by holding company upon consummation of the pro- the Federal Reserve Bank of New York pursuant posed transactions. Based on the available infor- to delegated authority. mation, however, it does not appear that Consorcio By order of the Board of Governors, effective Financiero, as presently constituted, would qualify December 31, 1976. as a foreign bank holding company. Unless Consorcio Financiero can demonstrate to the Board Voting for this action: Vice Chairman Gardner and Governors Wallich, Jackson, and Lilly. Absent and not that it is a "foreign bank holding company," and voting: Chairman Burns and Governors Coldwell and thus qualifies for the exemption of section 4(c)(9), Partee. it must, within two years of the date on which (Signed) THEODORE E. ALLISON, it becomes a bank holding company, either reduce [SEAL] Secretary of the Board. its investments in foreign companies to less than 5 per cent7 or apply to the Board to retain its foreign investments pursuant to section 4(c)(13) Act. In general, under § 225.4(f) of Regulation Y, domestic of the Act.8 bank holding companies are limited to owning and controlling shares of foreign companies that are engaged in international or foreign banking and other foreign or international financial operations. In contrast, under § 4(c)(9), a foreign bank holding company can own and control shares of any foreign company, 6Section 225.4(g)(l)(iii) defines "foreign bank holding regardless of the activities the company is engaged in, so long as it is only engaged in incidental activities in the United States. company" as a bank holding company "organized under the laws of a foreign country, more than half of whose consolidated assets are located, or consolidated revenues derived, outside Dakota Bancorporation, the United States." 7 Pursuant to section 4(c)(6) of the Act a bank holding Rapid City, South Dakota company may hold up to 5 per cent of the outstanding voting shares of nonbanking companies. Order Approving Acquisition of Bank 8Bank holding companies that do not qualify as foreign bank holding companies under § 225.4(g) of Regulation Y must Dakota Bancorporation, Rapid City, South Daapply to retain or acquire shares of foreign companies under § 225.4(f) of Regulation Y implementing § 4(c)(13) of the kota, a bank holding company within the meaning Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-64 Federal Reserve Bulletin • January 1977 of the Bank Holding Company Act, has applied eliminate any significant existing competition, infor the Board's approval under § 3(a)(3) of the crease the concentration of banking resources, or Act (12 U.S.C. § 1842(a)(3)) to acquire 80 per have an adverse effect on the development of cent of the voting shares of First National Bank future competition in the relevant market. Thereof Crosby ("Crosby Bank"), Crosby, North Da- fore, competitive considerations are consistent kota, a proposed new bank.1 with approval of the application. Notice of the application, affording opportunity The financial and managerial resources and fufor interested persons to submit comments and ture prospects of Applicant and its existing subviews, has been given in accordance with § 3(b) sidiary bank are regarded as satisfactory. Crosby of the Act. The time for filing comments and views Bank, as a proposed new bank, has no financial has expired and the Board has considered the or operating history; however, its prospects as a application and all comments received, including subsidiary of Applicant appear favorable. Considthose of Farmers State Bank of Crosby, Crosby, erations relating to the banking factors are con- North Dakota, in light of the factors set forth in sistent with approval of the application. The addi- § 3(c) of the Act (12 U.S.C. § 1842(c)). tions of a second banking alternative in Crosby Applicant controls one bank in North Dakota should enhance banking competition and increase with deposits of $3.0 million, representing 0.1 per services to residents of the area. In addition, a cent of the total commercial bank deposits in the paying and receiving station would remain avail- State, and is the 138th largest banking organization able in Columbus. Furthermore, the relocation of in North Dakota.2 Since Crosby Bank is a pro- Applicant's subsidiary bank from Columbus to the posed new bank, consummation of the proposed larger town of Crosby would appear to present the transaction would not immediately increase Ap- opportunity for Crosby Bank to increase the deplicant's share of commercial bank deposits in posit base assumed from Columbus Bank and, North Dakota. thus, enable it to offer improved services to the Applicant, a one-bank holding company, pres- market as a whole. Accordingly, considerations ently controls Columbus National Bank ("Co- relating to the convenience and needs of the comlumbus Bank"), Columbus, North Dakota. The munity to be served are consistent with approval proposal envisions Crosby Bank purchasing the of the application. assets and assuming the liabilities of Columbus Comments were filed in opposition to this pro- Bank. Columbus Bank will then be liquidated with posal by the Farmers State Bank of Crosby its capital accounts distributed to its shareholders. ("Protestant"), the only bank presently located in The Columbus Bank facility and its paying and Crosby. The Board has reviewed Protestant's subreceiving station in Lignite, North Dakota, will mission and has concluded that it does not present then become paying and receiving stations of a basis for denial of this application. It is the Crosby Bank. Columbus Bank, the only bank in Board's judgment that the proposed acquisition Columbus, represents 8.7 per cent of the deposits would be in the public interest and that the appliwithin the relevant market which contains both cation should be approved. Columbus and Crosby.3 Applicant is the smallest On the basis of the record, the application is of the four banking organizations in the market. approved for the reasons summarized above. The Since the proposal would essentially transfet transaction shall not be made (a) before the thirpresent accounts from Columbus Bank to Crosby tieth calendar day following the effective date of Bank, consummation of the proposal would not this Order or (b) later than three months after that date, and (c) First National Bank of Crosby, Crosby, North Dakota, shall be opened for business not later than six months after the effective *This application was filed under § 3(a)(3) of the Bank date of this Order. Each of the periods described Holding Company Act since the proposal involves the acquisi- in (b) and (c) may be extended for good cause tion by Applicant of shares of an additional bank. However, by the Board, or by the Federal Reserve Bank of the end result of the proposed transaction is that Applicant will continue to own only one bank whose main office will Minneapolis pursuant to delegated authority. be simply relocated from Columbus to Crosby, North Dakota. By order of the Board of Governors, effective 2Unless otherwise indicated, all banking data are as of December 13, 1976. December 31, 1975. 3 The relevant market is approximated by Divide and Burke Counties. Voting for this action: Chairman Burns and Gover- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 65 nors Gardner, Coldwell, Jackson, and Partee. Absent Bank is the smallest of four banking organiand not voting: Governors Wallich, and Lilly. zations in the relevant market (which is approxi- (Signed) GRIFFITH L. GARWOOD, mated by Noble County) and holds approximately [SEAL] Deputy Secretary of the Board. 10 per cent of market deposits. Since Applicant already controls Bank and since the proposal involves only the retention of Bank shares acquired pursuant to a pro rata stock offering, which shares Evans Insurance Agency, Inc., did not increase Applicant's percentage ownership of Bank, it does not appear that Applicant's reten- Billings, Oklahoma tion of Bank's shares would have any adverse Order Approving Retention of Bank Shares effect on existing or potential competition, nor increase the concentration of banking resources. Evans Insurance Agency, Inc., Billings, Okla- Thus, competitive considerations are consistent homa, a bank holding company within the meanwith approval of the application. ing of the Bank Holding Company Act, has ap- The financial and managerial resources and fuplied for the Board's approval under § 3(a)(3) of ture prospects of Applicant and Bank are satisthe Act (12 U.S.C. § 1842(a)(3)) to retain 411 factory. Accordingly, banking factors are consistof the outstanding voting shares of The First State ent with approval. There is no indication that the Bank in Billings, Billings, Oklahoma ("Bank"). convenience and needs of the community to be Notice of the application, affording opportunity served are not currently being met. Although there for interested persons to submit comments and will be no immediate increase in the services views, has been given in accordance with § 3(b) offered by Bank, convenience and needs considof the Act. The time for filing comments and views erations are consistent with approval. Therefore, has expired, and the Board has considered the it is the Board's judgment that the retention of application and all comments received in light of the shares of Bank would be in the public interest the factors set forth in § 3(c) of the Act (12 U.S.C. and that the application should be approved. § 1842(c)). On the basis of the record, the application is Applicant is a one-bank holding company by approved for the reasons summarized above. virtue of its ownership of 41.14 per cent of the By order of the Board of Governors, effective outstanding voting shares of Bank. In addition to December 1, 1976, the ownership of Bank, Applicant is engaged in general insurance agency activities in Billings, a Voting for this action: Chairman Burns and Govertown of less than 5,000 people. In March 1976, nors Gardner, Wallich, Coldwell, Jackson, Partee, and Applicant acquired an additional 411 shares of Lilly. Bank's outstanding voting shares pursuant to a pro (Signed) GRIFFITH L. GARWOOD, rata stock offering. The acquisition was made [SEAL] Assistant Secretary of the Board. without the Board's prior approval.1 Applicant now seeks the Board's approval to retain these Falsbuilding, Inc., shares. Bank ($5.2 million in deposits) is the 330th Columbia Falls, Montana largest banking organization in Oklahoma, con- Order Approving trolling 0.05 per cent of the total deposits in Acquisition of Stock Interests in Bank commercial banks in the State.2 Falsbuilding, Inc., Columbia Falls, Montana ("Applicant"), a bank holding company within 1 Since 1957 the Board has had outstanding an interpretation of the Bank Holding Company Act that states, in part, that the meaning of the Bank Holding Company Act the "purchase of bank stock by a bank holding company ("Act"), has applied for the Board's approval through the exercise of rights does require the Board's prior under § 3(a)(3) of the Act (12 U.S.C. § approval" (Interpretations 1 7050, 12 C.F.R. § 225.103). In accordance with the Board's position with respect to violations 1842(a)(3)) to acquire an additional 18.7 per cent of the Act, the Board has scrutinized the underlying facts of the outstanding voting shares of Bank of Cosurrounding the acquisition of Bank's shares. Upon an examilumbia Falls, Columbia Falls, Montana ("Bank"). nation of all the facts of record, including Applicant's undertaking to guard against violations in the future, the Board is Notice of the application, affording opportunity of the view that the circumstances surrounding the violations for interested persons to submit comments and are not such as would call for denial of the application. 2All banking data are as of December 31, 1975. views, has been given in accordance with § 3(b) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-66 Federal Reserve Bulletin • January 1977 of the Act. The time for filing comments and views Board's judgment that acquisition of the shares of has expired, and the Board has considered the Bank would be in the public interest and that the application and all comments received in light of application should be approved. the factors set forth in §3(c) of the Act (12 U.S.C. On the basis of the record, the application is § 1842(c)). approved for the reasons summarized above. Ac- In July of 1971, Applicant, a one-bank holding quisition of the shares of Bank shall not be made company by virtue of its ownership of 33.3 per (a) before the thirtieth calendar day following the cent of the outstanding voting shares of Bank, effective date of this Order or (b) later than three acquired an additional 18.7 per cent of Bank's months after the effective date of this Order, unless shares without the Board's prior approval. In 1972 such period is extended for good cause by the Applicant sought to divest itself of the shares and Board, or by the Federal Reserve Bank of Minis now seeking to acquire them by cash purchase.1 neapolis pursuant to authority hereby delegated. Bank ($13.4 million in deposits) is the 38th largest By order of the Board of Governors, effective banking organization in Montana, controlling 0.46 December 22, 1976. per cent of the total deposits in commercial banks in the State.2 Bank ranks fifth in the Flathead Voting for this action: Governors Gardner, Wallich, Coldwell, Jackson, Partee, and Lilly. Absent and not County banking market (which is approximated by voting: Chairman Burns. Flathead County and the northern third of Lake County) and holds 7.8 per cent of market deposits. (Signed) GRIFFITH L. GARWOOD, As Applicant has no other banking subsidiaries, [SEAL] Deputy Secretary of the Board. and the proposal involves only the acquisition of additional stock interests in Bank, approval of the application will not result in any adverse competi- The First Arabian Corporation, tive effects. It will eliminate neither existing nor Paris, France potential competition, nor will it increase the con- Order Approving centration of banking resources in any relevant Formation of Bank Holding Company. area. Thus, competitive considerations are consistent with approval of the application. The First Arabian Corporation, Paris, France The financial and managerial resources and fu- ("FAC"), has applied for the Board's approval ture prospects of Applicant and Bank are satis- under § 3(a)(1) of the Bank Holding Company Act factory and it appears that Applicant will be able (12 U.S.C. § 1842(a)(1)) of formation of a bank to service the debt associated with this application holding company through acquisition of 77.4 per while adequately maintaining Bank's capital posi- cent or more of the voting shares of Bank of the tion. Thus, banking factors are consistent with Commonwealth, Detroit, Michigan ("Bank"). approval. Notice of the application, affording opportunity There is no indication that the convenience and for interested persons to submit comments and needs of the community to be served are not views, has been given in accordance with § 3(b) currently being met. Although there will be no of the Act. The time for filing comments and views immediate increase in the services offered by has expired, and the Board has considered the Bank, convenience and needs considerations are application and all comments received in light of consistent with approval. Therefore, it is the the factors set forth in § 3(c) of the Act (12 U.S.C. § 1842(c)). FAC is a foreign corporation (total assets on a parent-only basis of $27.1 million, as of August 1It appears from the facts of record that the acquisition of 31, 1976) organized under Luxembourg law and the shares of Bank was based on a misunderstanding of the acts as a holding company with investments priapplicable statutes and regulations relating to the acquisition marily in various overseas business enterprises. Its of the voting stock of banks by bank holding companies. Applicant sought to take prompt corrective action to comply principal investments are in two English Compawith the Act. In accord with the Board's position with respect nies, headquartered in London, Edward Bates & to violations of the Act, the Board has scrutinized the underly- Sons (Holdings), Limited, whose major asset is ing facts surrounding the acquisition of the shares of Bank. Upon examination of all the facts of record, the Board is of a London merchant bank, and J. H. Rayner & the view that the facts surrounding the violations are not such Company, Limited, whose major interest is in a as would call for denial of the application. London based trading company, Rayner & Faure, 2All banking data are as of December 31, 1975. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 67 Limited. FAC, through Edward Bates & Sons, and modify terms of its notes. Such additional also has an interest in Edward Bates and Sons capital and the FDIC's proposed action are essen- North America, Houston, Texas, a company tial to the Bank's ability to continue functioning. principally engaged in the private placement of In these circumstances, the Board is of the view debt and securities.1 With the exception of Bates that the financial resources and future prospects North America, FAC's operations are conducted of Bank are dependent upon the implementation overseas. of the recapitalization plan, including FAC's in- Upon acquisition of Bank, FAC would control jection of capital into Bank. With respect to the sixth largest banking organization in Michigan Bank's managerial resources, they have shown with $836 million in deposits, representing 2.8 per some improvement, though additional strengthencent of the total commercial bank deposits in the ing is required. While FAC cannot be viewed as State.2 Bank is the fifth largest of 38 banking a significant source of managerial strength and its organizations operating in the Detroit banking current financial resources are otherwise limited, market (the relevant market) and controls 5.3 per FAC's assistance through the recapitalization plan cent of total commercial bank deposits in the does offer immediate financial strengthening of Detroit market.3 On the basis of the facts of record, Bank, which would preserve the opportunity for consummation of the proposal would have no further improvements. In light of all of the above significant adverse effects on existing or potential and other facts of record, it is the Board's view competition in any relevant area, therefore, com- that banking factors associated with this proposal petitive considerations are consistent with approval lend signficant weight toward approval of the apof the application. plication. Under the Bank Holding Company Act, the There is no evidence to indicate that the banking Board must consider the financial and managerial needs of the community to be served are not resources and future prospects of both the appli- currently being met. However, approval of the cant holding company and the bank to be acquired. proposal will enable Bank to continue to compete In regard to such considerations, it is noted that in the Detroit banking market as an independent Bank's condition is of such a nature that the direct and full-service competitive alternative in that financial support of the Federal Deposit Insurance market. Thus, convenience and needs consid- Corporation is required.4 While Bank's condition erations lend weight toward approval. Accordreflects some improvement since 1972, it appears ingly, based on the above and all the facts of that Bank has inadequate resources to repay the record, it is the Board's judgment that approval Capital Notes to the FDIC when due and maintain of the application would be in the public interest continued operations. As part of this proposal, and the application should be approved subject, FAC has agreed to make an equity capital infusion however, to the provisions and terms of the agreeinto Bank of $10 million (less any amounts derived ments and undertakings FAC enters into with the from the exercise of preemptive rights by existing Federal Deposit Insurance Corporation, and on the security holders), which will occur as a result of conditions that the recapitalization plan is apa recapitalization plan to be voted upon by Bank's proved by the stockholders of Bank and that the shareholders on December 20, 1976. At the same plan is in fact implemented. time, the FDIC has agreed to extend the maturity On the basis of the record, the application is approved for the reasons summarized above and on the conditions stated. The transaction shall not 1 By action of this date, in a separate Order, the Board has be made (a) before the thirtieth calendar day foldenied FAC's application, filed pursuant to § 4(c)(9) of the lowing the effective date of this Order or (b) later Act (12 U.S.C. § 1843(c)(9)), to retain Bates & Sons (Holdings), Limited. than three months after the effective date of this 2All banking data are as of December 31, 1975, and reflect Order, unless such period is extended for good bank holding company formations and acquisitions approved cause by the Board or by the Federal Reserve Bank as of October 30, 1976. 3The Detroit banking market is approximated by Macomb, of Chicago pursuant to delegated authority. Oakland and Wayne Counties. By order of the Board of Governors, December 4 In 1972, the Federal Deposit Insurance Corporation 17, 1976. ("FDIC") rendered financial assistance to Bank in the form of $35.5 million in 5.5 per cent Capital Notes which become due April 1, 1977. Voting for this action: Chairman Burns and Gover- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-68 Federal Reserve Bulletin • January 1977 nors Gardner, Wallich, Coldwell, and Partee. Absent a company, registered as a broker-dealer with the and not voting: Governors Jackson and Lilly. Securities and Exchange Commission, which en- (Signed) THEODORE E. ALLISON, gages in the business of assisting business enter- [SEAL] Secretary of the Board. prises in the private placement of debt and equity. FAC states that Bates North America places se- Order Disapproving curities with large institutional investors in the Retention of Investment in United States, but does not take an equity position Edward Bates & Sons (Holdings), Ltd. in the businesses it serves, and does not deal with The First Arabian Corporation, S.A. ("FAC"), the general public. It further appears that Bates Paris, France, has applied for the Board's approval North America in almost all cases participates in under Section 4(c)(9) of the Bank Holding Com- negotiations between its clients and prospective pany Act of 1956, as amended ("the Act"), 12 purchasers, and in most cases charges a fee that U.S.C. § 1843(c)(9), to retain more than five per is contingent upon a successful placement. cent of the voting shares of Edward Bates & Sons FAC believes that the activities of Bates North (Holdings), Ltd. ("Bates Holdings"), London, America should not cause Bates Holdings to be England, if FAC becomes a bank holding com- deemed to be indirectly engaged in the business pany. FAC now owns 24.7 per cent of the voting of underwriting, selling, or distributing securities shares of Bates Holdings, but proposes to reduce in the United States because Bates North its ownership to 7.5 per cent of such shares. America's activities do not present the dangers FAC today received the Board's approval to against which the Glass-Steagall Act and related become a bank holding company by acquisition laws and regulations were designed to protect. of 77.4 per cent of the voting shares of Bank of Accordingly, FAC believes its investment in Bates the Commonwealth ("Bank"), Detroit, Michigan. Holdings qualifies under § 225.4(g)(2)(v) of Reg- FAC presently owns 49% of J. H. Rayner & Co., ulation Y. In the alternative, FAC believes that Ltd. ("Rayner"), London, England, and holds an even if its investment in Bates Holdings does not option on an additional 2% of Rayner's voting meet the tests for exemption in § 225.4(g)(2)(v) shares, which it will exercise before acquiring of Regulation Y because of the activities of Bates shares of Bank. Upon exercise of this option and North America, FAC's investment in Bates Holdconsummation of the proposed acquisition of ings should be specifically approved under § Bank, FAC will be a foreign bank holding com- 225.4(g)(3) of Regulation Y. FAC essentially pany within the meaning of § 225.4(g)(l)(iii) of contends that due to its remote and tenuous rela- Regulation Y, and as such can, under § 225.4 tionship to Bates North America and its lack of (g)(2)(v) of Regulation Y, own or control voting control over Bates Holdings, retention would not shares of a company, organized under the laws be substantially at variance with the purposes of of a foreign country, that is engaged directly or the Act and would be in the public interest. In indirectly in activities in the United States if (a) particular, FAC believes that divestiture of its such company is not a subsidiary of FAC, (b) more interest in Bates Holdings below five per cent than half of the company's consolidated assets and would not be in the public interest since it could revenues are located and derived outside the delay FAC's acquisition of Bank. United States, and (c) such company does not It is the public policy of this Nation's banking engage, directly or indirectly, in the business of laws, as expressed in the Glass-Steagall Act, 12 underwriting, selling, or distributing securities in U.S.C. §§ 24(7), 78, 377, 378, to separate comthe United States. mercial banking from investment banking, and, in Bates Holdings, which is organized under the the Board's judgment, Bates North America's laws of the United Kingdom, meets the first two participation in negotitations and its contingent fee tests of § 225.4(g)(2)(v) of Regulation Y since arrangements infringe upon the area of investment it is not a subsidiary of FAC and more than half banking to such an extent that it must be considof its consolidated assets and revenues are located ered to be engaged in the business of underwriting, and derived outside the United States. However, selling, or distributing securities within the mean- Bates Holdings owns 52 per cent of the voting ing of § 225.4(g)(2)(v) of Regulation Y. In this shares of Edward Bates & Sons North America, connection, the Board notes that the Deputy Ltd. ("Bates North America"), Houston, Texas, Comptroller of the Currency has ruled, in letter Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 69 rulings dated November 11, 1974 and January 15, tion between commercial banking and investment 1975, that national banks and their subsidiaries banking activities than that permitted under the de should not participate in any substantial degree in minimis level of § 4(c)(6) of the Act. In addition, negotiations between their clients and prospective FAC's indirect investment in Bates North America purchasers of securities, nor should they charge is an investment that would not be permitted if a fee contingent upon a successful placement of FAC were a domestic bank holding company, and securities since such a middleman role "lies at the Board believes the principles of Glass-Steagall the heart of the investment banking business," and should apply equally to foreign bank holding such a fee arrangement is a "strong incentive for companies. Affiliation with a domestic securities the bank to locate a purchaser with whom a deal company could, in this regard, give a foreign bank can be made." It is precisely this promotional holding company a competitive advantage over interest of the investment banker that the Glass- domestic bank holding companies.3 Steagall Act intended to separate from the com- The Board notes that FAC proposes to reduce mercial banker's interest in acting as an impartial its ownership to 7.5 per cent of the outstanding source of credit and providing impartial investment shares of Bates Holdings, and the Board is aware advice.1 Accordingly, the Board concludes that from the facts of record that a further reduction Bates Holdings is engaged, indirectly through may be difficult.4 In recognition of this hardship, Bates North America, in the business of un- however, Congress has allowed bank holding derwriting, selling, or distributing securities in the companies from two to five years, depending on United States and that FAC's investment in Bates the circumstances in individual cases, to accom- Holdings therefore is not among the investments plish the divestiture of impermissible nonbank permitted by § 225.4(g)(2)(v) of Regulation Y. companies, and there is accordingly no reason that Furthermore, the Board has determined that Applicant's purchase of Bank shares should be under the circumstances retention of FAC's shares delayed on account of the Board's denial of this in Bates Holdings is substantially at variance with application. the purposes of the Act and is not in the public Based upon the foregoing and other considinterest, and FAC's request for a specific exemp- erations reflected in the record, the Board denies tion under § 225.4(g)(3) is denied. The Board the request of FAC for an exemption under Section notes that FAC's interest in Bates Holdings is 24.7 4(c)(9) of the Act for its investment in Bates per cent and may soon be reduced to 7.5 per cent, Holdings. Under Section 4(a)(2) of the Act, if and that such a reduction would tend to reduce FAC consummates its proposed acquisition of correspondingly the likelihood that abuses will Bank, it will be required by law to divest its arise from the relationship between Holdings and ownership of shares of Bates Holdings in excess Bank.2 Congress has provided in Section 4(c)(6) of five per cent within two years after the date of the Act, however, that a bank holding company on which it becomes a bank holding company. may own up to five per cent of the voting shares By order of the Board of Governors, effective of a company regardless of that company's activi- December 17, 1976. ties, and, because of the overriding importance to Voting for this action: Chairman Burns and Governors the banking system of the principles enunciated Gardner, Wallich, Coldwell, and Partee. Absent and by Congress in the Glass-Steagall Act, the Board not voting: Governors Jackson and Lilly. concludes that it would be substantially at variance with the purposes of the Act and would not be (Signed) THEODORE E. ALLISON, in the public interest to sanction a closer connec- [SEAL] Secretary of the Board. xSee Investment Company Institute v. Camp, 401 U.S. 617, 631-632 (1971). 2 The Board recognizes that measures might be taken to insulate FAC's banking and its indirect securities activities, but believes that to guard comprehensively and effectively 3 See Order disapproving retention by Banco di Roma of against all possible abuses, such measures would be so complex investment in Europartners Securities Corporation, supra, n. as to be administratively unworkable. See Order disapproving 2. retention by Banco di Roma of investment in Europartners 4 FAC states that because of its minority interest in Bates Securities Corporation, 59 Federal Reserve BULLETIN 940 Holdings it does not have the ability to effect a divestiture (1972). by Bates Holdings of Bates North America. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-70 Federal Reserve Bulletin • January 1977 First Maryland Bancorp, cant's only subsidiary bank, The First National Baltimore, Maryland Bank of Maryland, Baltimore, Maryland, are located. To support his contention that Hagerstown Order Approving Acquisition of Bank and the city of Hancock, where Bank is located, are in the same market, Protestant asserts that the First Maryland Bancorp, Baltimore, Maryland two are approximately 25 miles apart and are ("Applicant"), a bank holding company within connected by several roads including a four lane the meaning of the Bank Holding Company Act interstate highway. These roads are the only route ("Act"), has applied for the Board's approval from eastern Maryland to its four western counties. under § 3(a)(3) of the Act (12 U.S.C. § Protestant characterizes Hancock as a suburb of 1842(a)(3)) to acquire 51 per cent of the voting Hagerstown, and asserts that approximately ten per shares of The Hancock Bank, Hancock, Maryland cent of its workers are employed in Hagerstown. ("Bank"). Subsequent to consummation of the Further, he notes that a large shopping center is proposed transaction, Applicant intends to merge located near the Hagerstown exit on the above- Bank into Applicant's sole subsidiary bank, in the mentioned interstate highway and that Hancock event the Comptroller of the Currency approves residents visit the shopping center and travel to an appropriate application under the Bank Merger Hagerstown to shop or for entertainment. Finally, Act (12 U.S.C. § 1828(c)). noting that standard metropolitan statistical areas Notice of the application, affording opportunity ("SMSA's") are often used as the basis for analyfor interested persons to submit comments and sis of geographic markets, Protestant states that views, has been given in accordance with § 3(b) a publication widely used by advertising and marof the Act. The time for filing comments and views keting managers treats Washington County as a has expired, and the Board has considered the potential SMS A. According to this source, 80% application and all comments received, including of the metropolitan areas that it has deemed pothose of Mr. Donald Wolpe, a former stockholder tential SMSA's in the past eventually have been of Bank ("Protestant"), and the Department of officially designated SMSA's. Licensing and Regulation of the State of Maryland In light of Protestant's assertions, the Federal (which recommended approval of the application), Reserve Bank of Richmond conducted a field study in light of the factors set forth in § 3(c) of the of the Hancock and Hagerstown areas in order to Act (12 U.S.C. § 1842(c)). define the relevant market. This study and other Applicant, the third largest banking organization information of record indicate the following: Apin Maryland, controls deposits of approximately proximately 83 per cent of the total dollar volume $932 million, representing 10.7 per cent of total deposits in commercial banks in the State.1 Acqui- of Bank's demand deposits originates within a nine mile radius of Hancock. Hancock is approximately sition of Bank (deposits of $9.5 million) by Ap- 27 miles west of Hagerstown. The two are conplicant would increase Applicant's share of denected primarily by a two lane highway, U.S. 40, posits in the State by 0.1 per cent and would not and a four-lane highway, Interstate 70. U.S. 40 alter Applicant's rank among other banking orgamerges with Interstate 70 approximately 19 miles nizations in the State of Maryland. west of Hagerstown. The area west of Hagerstown Bank's sole office is located in Hancock, Marybeyond Clear Spring, Maryland, (located approxiland. Hancock is located in Washington County, mately eight miles to the west of Hagerstown) is Maryland, and is only one-half mile north of the mountainous, sparsely populated, and unsuited for West Virginia-Maryland border and one mile south development. Although there has been some deof the Pennsylvania-Maryland border. Protestant velopment immediately to the west of Hagerstown, contends that the relevant geographic market in the majority of growth has been directed to the which to assess the competitive effects of the north, south and east. Similarly, banking and proposed acquisition is approximated by Washbusiness development in the Hancock area has ington County, Maryland. Washington County inbeen concentrated on a north-south axis. Of the cludes Hagerstown, where six branches of Applibanks outside of Hancock, the bank located closest to Hancock is five miles to the south in Berkeley Springs, West Virginia. In the area separating Hancock and Berkeley Springs is a large manu- 1 Unless otherwise indicated, all banking data are as of facturing plant. Most of the other businesses in December 31, 1975. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 71 the Hancock area are located on the road to Ber- and the northern half of Morgan County, West keley Springs, in Hancock itself, or to the north Virginia, including Berkeley Springs (approxialong Interstate 70.2 Data generated by the Wash- mately five mjles south of Hancock). The Hagersington County Economic Development Commis- town Banking Market is approximated by the sion ("Development Commission") indicates that remainder of Washington County and the extreme the County's Planning Sector VI, which encom- southern portion of Franklin County, Pennsylpasses the Hancock area and consists of the west- vania.5 ernmost 15 miles of Washington County, is the Bank, with deposits of $9.5 million, is the only sector of the county that experienced a decline second largest of three banks in the Hancock in population between 1960 and 1970. The total market and holds 30.0 per cent of the total deposits population decrease for Sector VI during that pe- in commercial banks in that market.6 Applicant, riod was 5.5 per cent. By contrast, the population with total deposits of $69.9 million in the Hagersof the sector centered around Clear Spring in- town market, is the largest of 16 banking organicreased by 7.7 per cent. zations in that market, and controls 18.6 per cent The Development Commission has no informa- of market deposits.7 Five other banks in the market tion regarding commuting patterns in the County.3 have deposits in excess of $30 million. Officers of three Hagerstown banks that are major Bank's sole office is located 25 miles west of competitors of Applicant's subsidiary bank's the closest branch of Applicant's subsidiary bank. branches in Hagerstown have stated that their Both Applicant and Bank currently derive negligirespective banks derive little business from the ble amounts of business from the service area8 of Hancock area,4 and thus it does not appear that the other. Applicant's subsidiary bank's Hagersa significant portion of Hancock consumers of town offices acquire approximately 0.5 per cent banking services turn to Hagerstown banks for of their deposits and 0.7 per cent of their loans those services (other than for loans in excess of from Bank's service area, while Bank derives the lending limits of the Hancock banks). All three approximately 2.8 per cent of its deposits and 9.0 officers regarded Hancock as being outside of their per cent of its loans from Applicant's subsidiary market and felt that Applicant's proposed acquisi- bank's service areas throughout the State. These tion of Bank would have no competitive impact figures represent less than two per cent in each on their respective banks. Each of these bankers case of the loans and deposits outstanding in the felt that their primary competitors, outside of the Hancock market and in the Hagerstown market and banks in Hagerstown itself, were located in south- suggest that there is little existing competition ern Franklin County, Pennsylvania, in an area 10 between Applicant and Bank. On balance the to 15 miles north of Hagerstown, and thus two Board concludes that the effects of the proposed of these bankers have recently opened, or are in transaction on existing competition would, at the process of opening, branch offices north of most, be slightly adverse and that there would be Hagerstown. Accordingly, it does not appear that no adverse effects on the concentration of banking the proposed acquisition, if consummated, would resources in any relevant area. have a direct or immediate effect upon competition in Hagerstown. On the basis of the above and other information 5 Although Protestant asserts that Washington County is the of record, the Board concludes that Hancock is relevant market, complete application of Protestant's rationale for placing Hancock and Hagerstown in the same banking located in a banking market separate from Ha- market would require the inclusion of additional banks in gerstown. The best approximation of the Hancock Franklin County, Pennsylvania, all of the banks in Martinsburg, West Virginia, and several banks in Frederick County, Banking Market appears to be the western portion Maryland. Applicant's share of such a market would approxiof Washington County (excluding Clear Spring) mate seven per cent and Bank's would approximate 0.9 per cent. In view of Bank's size and the small amount of competition presently existing between Applicant and Bank, an acquisition of Bank by Applicant if such were the relevant market would not have significant adverse effects on either existing 2Interstate 70 turns north at Hancock. or potential competition or market concentration. 3Even if Protestant's unsubstantiated assertion that ten per 6As of June 30, 1975. cent of Hancock's workforce is employed in Hagerstown is 7 As of June 30, 1975. accepted, it would be insufficient to establish that Hancock 8 A service area is that geographic area contiguous to an and Hagerstown are in the same market. office from which approximately 80 per cent of the dollar 4As discussed below, Applicant also derives little banking amount of that office's deposits from individuals, partnerships, business from the Hancock area. and corporations is derived. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-72 Federal Reserve Bulletin • January 1977 Protestant suggests that the Hancock area would proposed acquisition would eliminate a substantial not be attractive for de novo entry by a new bank prospect for potential competition between Appliunaffiliated with a bank holding company, but that cant and Bank.11 de novo entry into the Hancock area could prove The financial and managerial resources of Approfitable for a bank holding company with an plicant and its subsidiaries are satisfactory and established Washington County presence such as their future prospects appear favorable. The finan- Applicant. Moreover, Protestant argues, allowing cial resources of Bank are also satisfactory and Applicant to enter the Hancock market will dis- its future prospects are favorable. It appears, courage other banks from entering that market and however, that the managerial strength of Applicant will place the "remaining small competitor"9 in could be a significant benefit for Bank and the Hancock in competition with Applicant's much Board concludes that banking factors lend some larger organization. weight toward approval of the application. The Board is unable to conclude that the Han- With regard to the convenience and needs of cock market is attractive for de novo entry gener- the community to be served, Protestant states that ally or in the manner described by Protestant. The there is generally no need in the Hancock area median family income of the Hancock market in for the additional services Applicant proposes to 1970 was $7,100. This figure compares unfavor- offer. Applicant has submitted additional informaably with the $8,800 median for the Hagerstown tion regarding these matters and it appears that market and the State median of $11,100. More residents of the Hancock market will benefit from significantly, the population per banking office in the addition of higher lending limits,12 trust servthe State is approximately 5,200, whereas the ices, individual retirement accounts, and credit Hancock market has only approximately 1200 card services, all currently unavailable from Hanpeople per banking office. Coupling this income cock area banks. Accordingly, the Board conand population data with the Hancock market's cludes that considerations related to the convendeclining population suggests that the market is ience and needs of the community to be served quite unattractive for de novo entry. This data also lend weight toward approval of the application. undermines Protestant's tacit assumption that State Any slight anticompetitive effects associated with and Federal bank chartering authorities would the proposed transaction are clearly outweighed by readily grant an application to open either a branch convenience and needs considerations and the office or a new bank in the Hancock market. With Board finds that the application should be apregard to Protestant's assertion that consummation proved. of the proposed transaction will discourage entry by others, it is the Board's judgment that Applicant's acquisition of Bank will not raise significant additional barriers to de novo entry in view of the market in which its market share was 49 per cent, as opposed fact that the market is already quite unattractive to Applicant's 18.6 per cent. Western Michigan Corp./First National Bank of Cassopolis, for such entry. In view of the unattractiveness of 62 Federal Reserve BULLETIN 624 (1976) and Alabama Banthe Hancock market for de novo entry, it does not corporation/Muscle Shoals National Bank, 61 Federal Reserve appear that Applicant is a potential entrant into BULLETIN 672 (1975), also cited by Protestant, are inapplicable the market other than by acquisition of Bank.10 as in each of those cases the Applicant was located in the same market as the bank to be acquired. Thus, it does not appear that consummation of the 11 The record in this matter does not indicate whether the smallest bank in the Hancock market is available for acquisition by Applicant. While such availability might initially seem probative of the feasibility of foothold entry into the market, the facts that the smallest bank holds deposits of $8.3 million compared to Bank's $9.2 million, that the market share of 9Protestant's reference to the "remaining small competitor" the smallest bank is 26.8 per cent while Bank's is 30 per cent, in Hancock ignores the existence of the third (and largest) bank and that the smallest bank operates two offices in the market in the Hancock market which is located five miles to the south to Bank's one, resolve the foothold entry question in favor of Hancock in Berkeley Springs, West Virginia. of Applicant. 10Protestant's reliance on Old Kent Financial Corp./National 12 Bank is presently prohibited by law from making loans Lumberman's Bank and Trust Co., 60 Federal Reserve BUL- in excess of $55,000. The legal lending limit of Applicant's LETIN 133 (1974), reconsideration 61 Federal Reserve BULLE- subsidiary bank is approximately $8 million. As indicated TIN 247 (1975) (denied on competitive grounds), is misplaced. above, each of the three Hagerstown competitors of Applicant's In that case the Board found the relevant market to be capable subsidiary bank has attempted to meet a need on the part of of supporting de novo entry and Old Kent was regarded as Hancock customers for loans exceeding the lending limits of a likely de novo entrant. Old Kent was located in an adjacent the Hancock area banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 73 On the basis of the record, the application is Bank is the only bank in Hickory County, which approved for the reasons summarized above. The approximates the relevant geographic market. In transaction shall not be made (a) before the thir- view of the fact that Applicant already controls tieth calendar day following the effective date of Bank and the proposal involves the retention of this Order or (b) later than three months after the Bank shares acquired pursuant to a pro rata stock effective date of this Order, unless such period offering without any change in Applicant's peris extended for good cause by the Board, or by centage ownership of Bank, it does not appear that the Federal Reserve Bank of Richmond pursuant Applicant's retention of Bank's shares would have to delegated authority. any adverse effect on existing or potential compe- By order of the Board of Governors, effective tition; nor would it increase the concentration of December 29, 1976. banking resources in any relevant area. Thus, competitive considerations are consistent with ap- Voting for this action: Vice Chairman Gardner and proval of the application. Governors Wallich, Jackson, and Lilly. Absent and not The financial and managerial resources of Apvoting: Chairman Burns and Governors Coldwell and Partee. plicant and Bank are generally satisfactory and the future prospects for each appear favorable. Ac- (Signed) GRIFFITH L. GARWOOD, cordingly, banking factors are consistent with ap- [SEAL] Deputy Secretary of the Board. proval. Although there will be no immediate increase in the services offered by Bank, convenience and needs considerations are also consistent with approval. Therefore, it is the Board's judg- Freeco, Inc., ment that the retention of the shares of Bank would Hermitage, Missouri be in the public interest and that the application should be approved. Order Approving Retention of Bank Shares On the basis of the record, the application is approved for the reasons summarized above. By order of the Board of Governors, effective Freeco, Inc., Hermitage, Missouri, a bank December 20, 1976. holding company within the meaning of the Bank Holding Company Act, has applied for the Board's Voting for this action: Chairman Burns and Goverapproval under § 3(a)(3) of the Act (12 U.S.C. nors Gardner, Wallich, Coldwell, Jackson, Partee, and § 1842(a)(3)) to retain 1,956 of the outstanding Lilly. voting shares of The Bank of Hermitage, Hermit- (Signed) GRIFFITH L. GARWOOD, age, Missouri ("Bank"). [SEAL] Deputy Secretary of the Board. Notice of the application, affording opportunity for interested persons to submit comments and views, has been given in accordance with § 3(b) 1 Since 1957 the Board has had outstanding an interpretation of the Bank Holding Company Act that states, in part, that of the Act. The time for filing comments and views the "purchase of bank stock by a holding company through has expired, and the Board has considered the the exercise of rights does require the Board's prior aproval." application and all comments received in light of (Interpretations H 7050, 12 C.F.R. § 225.103). In accordance with the Board's position with respect to violations of the Act, the factors set forth in § 3(c) of the Act (12 U.S.C. the Board has scrutinized the underlying facts surrounding the § 1842(c)). acquisition of Bank's shares. Upon an examination of all the facts of record, including Applicant's undertaking to guard Applicant is a one-bank holding company by against violations in the future, the Board is of the view that virtue of its ownership of 48.9 per cent of the the circumstances surrounding the violation are not such as outstanding voting shares of Bank. In December would call for denial of the application. 2 All banking data are as of December 31, 1975. of 1975, Applicant acquired an additional 1,956 shares of Bank's outstanding voting shares pursu- Gay lord Bankshares, Inc., ant to a pro rata stock offering. The acquisition was made without the Board's prior approval.1 Gaylord, Kansas Applicant now seeks the Board's approval to retain Order Denying these shares. Bank ($8.6 million in deposits) is Formation of Bank Holding Company the 415th largest banking organization in Missouri, controlling 0.05 per cent of the total deposits in Gaylord Bankshares, Inc., Gaylord, Kansas, commercial banks in the State.2 has applied for the Board's approval under § Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-74 Federal Reserve Bulletin • January 1977 3(a)(1) of the Bank Holding Company Act (12 to its subsidiary bank(s) and that the Board will U.S.C. § 1842(a)(1)) of formation of a bank closely examine the condition of an applicant in holding company through acquisition of 80 per each case with this consideration in mind. As part cent or more of the voting shares of The First of this proposal, Applicant would assume $120,- National Bank of Gaylord, Gaylord, Kansas 000 of the debt originally incurred by Applicant's ("Bank"). principal in acquiring shares of Bank. Applicant Notice of the application, affording opportunity proposes to service this debt over a 12-year period for interested persons to submit comments and through dividends to be declared by Bank and the views, has been given in accordance with § 3(b) tax benefits to be derived from filing consolidated of the Act. The time for filing comments and views tax returns. In the Board's view, the projected has expired, and the Board has considered the earnings of Applicant over the debt-retirement application and all comments received, including period appear to be somewhat optimistic in view those submitted by the Comptroller of the Cur- of Bank's previous earnings record and, even if rency and Applicant's responses thereto, in light actually realized, would not provide Applicant of the factors set forth in § 3(c) of the Act (12 with the financial flexibility necessary to meet its U.S.C. § 1842(c)).1 annual debt service requirements while maintain- Applicant is a nonoperating corporation orga- ing adequate capital at Bank. While there has been nized under the laws of Kansas for the purpose some improvement in earnings of Bank since its of becoming a bank holding company through acquisition by Applicant's principal, this imacquisition of Bank ($2.8 million in deposits).2 provement has occurred over only one year and Upon acquisition of Bank, Applicant would con- does not provide Applicant with a proven record trol the 536th largest bank in Kansas, holding of earnings to support its projections. approximately .03 of one per cent of the total The Board is of the opinion that in analyzing deposits in commercial banks in the State. the managerial resources of a bank that is part of Bank is the seventh largest of eight commercial a chain of one-bank holding companies it should banks in the relevant market,3 and holds approxi- look beyond the subject bank involved in an apmately 4.2 per cent of the total deposits in com- plication to the other banks that are part of that mercial banks in the market. The principal owner chain. In assessing the managerial resources of of Applicant is also the principal owner of Osborne Applicant, the Board notes that the overall finan- Bankshares, Inc., a registered one-bank holding cial resources of First, the subsidiary bank of the company controlling 80 per cent of The First State affiliated one-bank holding company, have de- Bank & Trust Company, Osborne, Kansas clined somewhat since First was placed in the ("First"), which is located 18 miles south of Bank holding company. The decline of the financial in the same banking market. Given the size of resources of First does not reflect favorably on the banks involved and the structure of the market, Applicant's management capabilities and weighs it is the Board's view that the combination of these against approval of this application. two banks in the market would have no significant On the basis of the above banking factors and adverse effects on competition. Accordingly, other factors of record, the Board is of the view based on the facts of record, the Board concludes that it would not be in the public interest to that consummation of the proposed transaction approve the formation of a bank holding company would have no significant adverse effect upon with an initial debt structure that could result in either existing or potential competition. the weakening of Bank's overall financial condi- The Board has indicated on previous occasions tion, and the Board concludes that the considthat it believes that a bank holding company should erations relating to financial and managerial rebe a source of financial and managerial strength sources weigh against approval of the application. As indicated above, the proposed formation essentially involves the reorganization of the ownership interests of Bank. No significant changes Hn letters dated August 27, 1976 and October 21, 1976, in Bank's operations or in the services offered to the Comptroller of the Currency recommended denial of the customers of Bank are anticipated. Consequently, subject application. Applicant responded to the Comptroller in letters dated September 14, 1976 and November 4, 1976. considerations relating to the convenience and 2 All banking data are as of December 31, 1975. needs of the community to be served lend no 3 The relevant market is approximated by Smith and northern weight toward approval of the application. Osborne counties. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 75 On the basis of all of the circumstances con- of Bank ($83.4 million in deposits) would increase cerning this application, the Board concludes that Applicant's share of Statewide deposits to 8.6 per the financial and managerial considerations in- cent but would not change Applicant's ranking in volved in this proposal present adverse circum- the State. stances bearing upon the financial resources and Bank, a subsidiary of NBS Financial Corporafuture prospects of both Applicant and Bank. Such tion, Southfield, Michigan ("NBS"), a registered adverse factors are not outweighed by any pro- bank holding company now in the process of competitive effects or by benefits that would result liquidating its assets, is located in a northwest in serving the convenience and needs of the com- suburb of Detroit in the Detroit banking market. munity. Accordingly, it is the Board's judgment Bank controls 0.5 per cent of the total deposits that approval of the application would not be in in commercial banks in the relevant market2 and, the public interest and that the application should were it an independent institution, would be the be denied. 18th largest of 38 banking organizations operating On the basis of the record, the application is in the market.3 Applicant is the third largest bankdenied for the reasons summarized above. ing organization in the relevant market, controlling By order of the Board of Governors, effective two banks (aggregate deposits of approximately December 13, 1976. $2.4 billion) and 15.1 per cent of the commercial bank deposits in the market. Consummation of the Voting for this action: Chairman Burns and Gover- proposal would increase Applicant's market share nors Gardner, Coldwell, Jackson, and Partee. Absent to 15.6 per cent. and not voting: Governors Wallich and Lilly. In view of the already high level of banking (Signed) THEODORE E. ALLISON, concentration existing in the Detroit banking mar- [SEAL] Secretary of the Board. ket (the four largest banking organizations control about 71.5 per cent of the deposits), the Board views with serious concern the increase in con- Manufacturers National Corporation, centration that would result from the consumma- Detroit, Michigan tion of this proposal, and regards such an increase as a significantly adverse factor in its consideration Order Approving Acquisition of Bank of this application. Manufacturers National Corporation, Detroit, In addition to the effects of the proposal on Michigan, a bank holding company within the banking concentration in the Detroit market, the meaning of the Bank Holding Company Act, has Board is of the view that the proposal would have applied for the Board's approval under § 3(a)(3) substantially adverse effects on existing competiof the Act (12 U.S.C. § 1842(a)(3)) to acquire tion between Applicant and Bank. Bank is headall of the voting shares (less directors' qualifying quartered in the Detroit suburb of Southfield shares) of National Bank of Southfield, Southfield, wherein it operates five of its six banking offices; Michigan ("Bank"). its other branch is located in a nearby township. Notice of the application, affording opportunity Applicant has two subsidiary banks, including its for interested persons to submit comments and lead bank, in the Detroit market, and many of their views, has been given in accordance with § 3(b) offices are located in close proximity to Southfield. of the Act. The time for filing comments and views Consequently, consummation" of this proposal has expired, and the Board has considered the would eliminate a significant amount of existing application and all comments received in light of competition within the Detroit market. the factors set forth in § 3(c) of the Act (12 U.S.C. In view of the foregoing discussion and based § 1842(c)). on the facts of record, the Board concludes that Applicant, the fourth largest banking organization in Michigan, controls four banks with aggregate deposits of approximately $2.5 billion, 2 The Detroit banking market is the relevant banking market representing 8.3 per cent of the total deposits held and is approximated by Macomb, Oakland, and Wayne Counby commercial banks in Michigan.1 Acquisition ties. 3With its two subsidiary banks, NBS has aggregate deposits of approximately $118.1 million and is the fifteenth largest banking organization in the market with 0.7 per cent of the *A11 banking data are as of December 31, 1975. market's deposits. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-76 Federal Reserve Bulletin • January 1977 the competitive effects of the proposal are sub- By order of the Board of Governors, effective stantially adverse. Under the standards set forth Decemher 30, 1976. in § 3(c) of the Bank Holding Company Act, it is clear that the Board may not approve the subject Voting for this action: Vice Chairman Gardner and Governors Wallich, Jackson, and Lilly. Absent and not proposal unless the Board finds that "the anticomvoting: Chairman Burns and Governors Coldwell and petitive effects of the proposed transaction are Partee. clearly outweighed in the public interest by the (Signed) THEODORE E. ALLISON, probable effect of the transaction in meeting the [SEALI Secretary of the Board. convenience and needs of the community to be served." In assessing such considerations in light Scribner Banshares, Inc., of the facts surrounding this proposal, the Board Scribner, Nebraska finds that the anticompetitive effects are clearly outweighed in the public interest. Order Approving The financial and managerial resources and fu- Formation of Bank Holding Company ture prospects of Applicant and its subsidiaries are Scribner Banshares, Inc., Scribner, Nebraska, considered satisfactory and consistent with aphas applied for the Board's approval under § proval of this application. Bank's financial and 3(a)(1) of the Bank Holding Company Act (12 managerial resources, absent consummation of the U.S.C. § 1842(a)(1)) of formation of a bank instant proposal, aire less than satisfactory, and its holding company through acquisition of 96.1 per future prospects are uncertain. Bank has suffered cent or more of the voting shares of Scribner Bank, losses in its operations and, lacking the internal Scribner, Nebraska ("Bank"). capability of reversing the adverse trend, it appears Notice of the application, affording opportunity unlikely that Bank will be able to continue as a for interested persons to submit comments and viable organization in serving the public. Under views, has been given in accordance with § 3(b) this proposal, Applicant has agreed to inject capital of the Act. The time for filing comments and views of $2 million and to provide significant managerial has expired, and the Board has considered the assistance to Bank. These actions would assure application and all comments received in light of bank's continued viability and the availability of the factors set forth in § 3(c) of the Act (12 U.S.C. Bank as a source of banking services in the Detroit § 1842(c)). banking market. While the Board would prefer a Applicant, a corporation chartered in 1974 less anticompetitive acquisition as a means of under the laws of the State of Nebraska, has been assuring the continuation of Bank as a vehicle for operating as a general insurance agency from the serving the convenience and needs of the public, premises of Bank since the date of its organization it appears that such an alternative is not readily and currently owns 3.3 per cent of the shares of available. Therefore, the Board views the im- Bank. Applicant has now applied to the Board for proved financial prospects of Bank and the conpermission to become a bank holding company venience and needs considerations as lending sigthrough acquisition of an additional 96.1 per cent nificant weight toward approval of the application or more of the shares of Bank.1 Upon acquisition and clearly outweighing the substantially adverse of those shares, Applicant would control the 111th competitive effects that would result from conlargest banking organization in Nebraska with total summation of the proposal. Accordingly, it is the deposits of approximately $12.5 million, repre- Board's judgment that consummation of the prosenting 0.2 per cent of total deposits held by posal would be in the public interest and that the commercial banks in the State.2 Bank is the only application should be approved. bank in Scribner, Nebraska and is the third largest On the basis of the record, the application is of eight banks in the relevant banking market,3 approved for the reasons summarized above. The transaction shall not be made (a) before the thirtieth calendar day following the effective date of this Order or (b) later than three months after the 1 Applicant will terminate its insurance agency business prior effective date of this Order, unless such period to consummation of the proposed bank holding company foris extended for good cause by the Board, or by mation. the Federal Reserve Bank of Chicago pursuant to 2 All banking data are as of December 31, 1975. 3 The relevant banking market is approximated by the delegated authority. boundaries of Dodge County. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 78 controlling approximately 8.3 per cent of the de- Voting for this action: Chairman Burns and Goverposits therein. nors Gardner, Wallich, Cold well, Jackson, Partee, and Five of Applicant's principals are also directors Lilly. and/or officers of other banks or bank holding (Signed) GRIFFITH L. GARWOOD, companies in Nebraska, Iowa, and South Dakota. [SEAL] Deputy Secretary of the Board. However, these banking organizations are located at considerable distances from Bank in different Trust Company of Georgia, banking markets. Furthermore, inasmuch as the instant proposal to form a bank holding company Atlanta, Georgia represents a reorganization of the ownership of Order Approving Acquisition of Bank Bank by ten individuals to a corporation owned by the same individuals, it appears that the acqui- Trust Company of Georgia, Atlanta, Georgia, sition of Bank by Applicant would have no signif- a bank holding company within the meaning of icant adverse effect upon either existing or poten- the Bank Holding Company Act, has applied for tial competition. Accordingly, on the basis of the the Board's approval under § 3(a)(3) of the Act record, the Board concludes that competitive con- (12 U.S.C. § 1842(a)(3)) to acquire 80 per cent siderations are consistent with approval of the or more of the voting shares of Security National application. Bank, Smyrna, Georgia ("Bank"). The financial and managerial resources of Ap- Notice of the application, affording opportunity plicant and Bank are regarded as satisfactory. The for interested persons to submit comments and future prospects of Applicant are dependent upon views, has been given in accordance with § 3(b) those of Bank, which are also regarded as satis- of the Act. The time for filing comments and views factory. Although Applicant will incur acquisition has expired, and the Board has considered the debt in connection with this proposal, it appears application and all comments received in light of that it will be able to service this debt adequately the factors set forth in § 3(c) of the Act (12 U.S.C. without impairing the financial resources of Bank. § 1842(c)). Furthermore, it appears that the overall financial Applicant, the third largest banking organization and managerial considerations with respect to the in Georgia, directly controls Trust Company Bank, other one-bank holding companies in which Atlanta, Georgia, (deposits of $796 million) and principals of Applicant are involved are generally indirectly controls five other banks (aggregate desatisfactory. Therefore, considerations relating to posits of approximately $400 million).1 The agbanking factors are consistent with approval of the gregate deposits of Applicant's six subsidiary application. banks represent about 10 per cent of the total Although consummation of the proposal would deposits in commercial banks in the State. Acquieffect no changes in the services offered by Bank, sition of Bank would increase Applicant's share the Board regards considerations relating to the of State deposits by . 14 of one per cent and would convenience and needs of the community to be neither have a significant effect upon the concenserved as being consistent with approval. It is the tration of banking resources in Georgia nor alter Board's judgment that the proposed acquisition Applicant's State-wide ranking. would be in the public interest and that the appli- Bank is the 24th largest of 36 banking organication should be approved. zations in the Atlanta banking market2 and holds On the basis of the record, the application is deposits of $17.4 million, representing approxiapproved for the reasons summarized above. The mately 0.3 per cent of the total deposits in comtransaction shall not be made (a) before the thir- mercial banks in the market. Trust Company tieth calendar day following the effective date of Bank, Applicant's lead bank, also operates in the this Order or (b) later than three months after the Atlanta banking market and is the third largest effective date of this Order, unless such period is extended for good cause by the Board, or by the Federal Reserve Bank of Kansas City pursuant to delegated authority. 1 All banking data are as of December 31, 1975. 2The Atlanta banking market is approximated by Fulton, By order of the Board of Governors, effective Dekalb, Cobb, Gwinnett, Clayton, Douglas, Henry, and December 20, 1976. Rockdale Counties in Georgia. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-78 Federal Reserve Bulletin • January 1977 banking organization in that market with 14 per the Federal Reserve Bank of Atlanta pursuant to cent of the total deposits in commercial banks in delegated authority. the market. Trust Company Bank has 37 branches By order of the Board of Governors, effective in Dekalb and Fulton Counties, while Bank has December 7, 1976. two branches in Cobb County. Although it appears that consummation of the proposal would eliminate some existing competition between Bank and Voting for this action: Chairman Burns and Gover- Applicant, the Board notes that the competition nors Gardner, Wallich, Jackson, Partee, and Lilly. Voting against this action: Governor Coldwell. that would be eliminated is not of a significant magnitude and that numerous independent banking organizations would remain in the Atlanta market (Signed) THEODORE E. ALLISON, following the acquisition. In addition, Georgia law [SEAL] Secretary of the Board. prohibits Applicant from branching into or acquiring a de novo bank in Cobb County and, accordingly, Bank is the smallest vehicle which is available to Applicant as a means of entry into that Dissenting Statement of Governor Coldwell county. Thus, Bank's acquisition by Applicant is regarded as a foothold entry into Cobb County. I dissent from the Board's action approving the In view of the foregoing, the Board concludes that application of Trust Company of Georgia, to acthe proposed acquisition would have only a quire Security National Bank. Applicant, through slightly adverse effect on competition. its lead bank, already has a significant presence The financial and managerial resources of Ap- in the Atlanta banking market, where it ranks third plicant and its subsidiaries and their future pros- among the 36 banking organizations operating in pects are regarded as generally satisfactory. Those the market, with about 14 per cent of the market's of Bank are regarded as satisfactory. Consid- bank deposits. Applicant's acquisition of an addierations relating to the banking factors are con- tional bank in this same market represents a horisistent with approval of the application. Applicant zontal acquisition which would result in some intends to offer services not presently available to further concentration and adverse effects on comcustomers of Bank and to reduce the effective cost petition. While the acquisition is not a large one, of other services presently offered by Bank. Fol- it would remove another competitor and deny to lowing consummation of the acquisition, Bank a smaller bank holding company the possibility would make available to its customers free check- of a foothold entry using that bank. ing accounts, reduced interest rates on consumer The Bank Holding Company Act requires the loans, and a more favorable method of com- Board to consider whether such adverse competipounding interest on savings accounts. Addition- tive effects are clearly outweighed in the public ally, Applicant will cause Bank to increase its interest by considerations reflected in the record hours and to apply for new branches. Consid- relating to the convenience and needs of the comerations relating to convenience and needs of the munity to be served. Applicant already serves the community to be served lend some weight toward relevant banking market through 37 branch offices. approval of the application and outweigh the Thus, this proposal would not result in the introslightly adverse effects on competition that might duction of new services which are not already result from consummation of this proposal. Ac- available in the market, and I do not see how cordingly, it is the Board's judgment that the consummation of this proposal would benefit the proposed acquisition would be in the public inter- convenience and needs of the relevant banking est and that the application should be approved. market to any important extent. Accordingly, I On the basis of the record, the application is would find that convenience and needs considapproved for the reasons summarized above. The erations do not outweigh the adverse competitive transaction shall not be made (a) before the thir- effects flowing from Applicant's proposal. tieth calendar day following the effective date of On the basis of the record, it is my judgment this Order or (b) later than three months after the that the proposed acquisition would not be in the effective date of this Order, unless such period public interest and that the application should be is extended for good cause by the Board, or by denied. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 79 Order Under Section 4(a)(2) ("Registrant" or "C.I.T."), New York, New of Bank Holding Company Act York, became a bank holding company on December 31, 1970, as a result of the 1970 Amend- C.I.T. Financial Corporation, ments to the Act and by virtue of Registrant's New York, New York control of 100 per cent of the voting shares (less directors' qualifying shares) of National Bank of Determination Regarding 6'Grandfather" North America ("Bank"), New York, New York Privileges Under Bank Holding Company Act (assets of about $2.1 billion, as of December 31, Section 4 of the Bank Holding Company Act 1970). Bank, control of which was acquired by (12 U.S.C. 1843) provides certain privileges Registrant in 1965, has total domestic deposits of ("grandfather" privileges) with respect to non- approximately $2.2 billion, representing about 1.6 banking activities of a company that, by virtue per cent of the total deposits in commercial banks of the 1970 Amendments to the Bank Holding in New York State and approximately 2.3 per cent Company Act, became subject to the Bank Hold- of the total deposits in commercial banks in the ing Company Act. Pursuant to § 4(a)(2) of the New York City metropolitan banking market.2 Act, a "company covered in 1970" may continue Bank, which operates 141 offices in the New York to engage, either directly or through a subsidiary, City metropolitan banking market, is the 10th in nonbanking activities that such a company was largest bank in New York State and the 35th lawfully engaged in on June 30, 1968 (or on a largest banking organization in the Nation. date subsequent to June 30, 1968, in the case of The bulk of Registrant's financial resources is activities carried on as a result of the acquisition concentrated in its nonbanking activities and its by such company or subsidiary, pursuant to a financial strength is not dependent upon the rebinding written contract entered into on or before sources of Bank. Indeed, Registrant has served as June 30, 1968, of another company engaged in a source of financial strength to Bank and by such activities at the time of the acquisition), and instituting a conservative dividend policy has enahas been continuously engaged in since June 30, bled Bank to accumulate a very strong capital 1968 (or such subsequent date). base. The Board has found no evidence of any Section 4(a)(2) of the Act provides, inter alia, unsound banking practices, and furthermore, acthat the Board of Governors of the Federal Reserve tions taken by Registrant toward improving System may terminate such grandfather privileges various areas of Bank's operations should enhance if, having due regard to the purposes of the Act, its prospects and overall performance. the Board determines that such action is necessary Registrant, organized in 1924, is a diversified to prevent an undue concentration of resources, conglomerate which engages, either directly or decreased or unfair competition, conflicts of inter- through subsidiaries, in a broad range of activities est, or unsound banking practices. but primarily banking, consumer financing, busi- Notice of the Board's proposed review of ness financing, factoring, leasing of personal and grandfather privileges of C.I.T. Financial Cor- real property, and acting as insurance underwriter poration, New York, New York, and an opportu- and agent. It also engages to a lesser extent in nity for interested persons to submit comments and manufacturing and merchandising, providing data views or request a hearing, has been given (37 processing services, making venture capital in- F.R. 22414 and 37 F.R. 25204). The time for vestments either directly or through limited partfiling comments, views, and requests has expired, nerships, developing and managing real estate and all those received, including those submitted by the Independent Insurance Agents of America (formerly the National Association of Insurance during the course of the Board's review of C.I.T.'s grand- Agents) and the Independent Insurance Agents of father privileges, a petition requesting a hearing on C.I.T.'s North Carolina, have been considered by the insurance activities was filed on behalf of the Independent Board in light of the factors set forth in § 4(a)(2) Insurance Agents of America and the Independent Insurance Agents of North Carolina. Following an exchange of correof the Act.1 spondence, the scope of C.I.T.'s insurance activities was On the evidence before it, the Board makes the clarified for the Petitioners and they subsequently withdrew their request for a hearing. following findings. C.I.T. Financial Corporation 2Banking data as of December 31, 1975, unless otherwise noted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-80 Federal Reserve Bulletin • January 1977 through limited partnerships, and controlling C.I.T. engages in industrial financing and leascharitable foundations. As of December 31, 1975, ing activities ($1.7 billion of receivables outstand- C.I.T. and all of its subsidiaries had total com- ing on December 31, 1975) through a network of bined assets of approximately $7 billion. Approx- offices located throughout the United States and imately 50 per cent of these assets are attributable has been engaged in these activities continuously to C.I.T.'s consumer and business finance activi- since June 30, 1968. C.I.T.'s industrial financing ties, while Bank accounts for about 41 per cent and leasing business covers heavy construction of its assets. The balance is divided largely be- equipment, commercial air transport, railway rolltween its manufacturing and insurance subsidi- ing stock, marine tankers, material handling maaries. chinery, data processing hardware, offshore drill- C.I.T. engages in consumer financing activities ing rigs, and fleets of cars and trucks. These ($3.9 billion of receivables outstanding on De- leasing activities are conducted on both a fullcember 31, 1975) primarily through direct and payout and non-full-payout basis. During 1975 indirect subsidiary companies with about 1,000 C.I.T. originated $0.9 billion of industrial loans offices located throughout the United States and and lease receivables. In addition, C.I.T. engages in Puerto Rico and Canada, and has been engaged in factoring and commercial financing activities in such activities continuously since June 30, primarily through three subsidiaries and has been 1968. In addition to the usual forms of consumer engaged in these activities continuously since June lending, some or all of these subsidiaries engage 30, 1968. During 1975, C.I.T.'s factoring and in purchasing retail installment obligations, fin- commercial finance companies acquired receivancing dealers' inventories, and making second ables of approximately $3.0 million, and year-end mortgage loans. C.I.T. is one of the nation's receivables outstanding were $509.6 million. largest independent finance companies in terms of Since Registrant has been engaged in these fireceivables with receivables of $5 billion origi- nancing, leasing, and factoring activities since nated during 1975. Since Registrant has been June 30, 1968, and continuously thereafter, these engaged in consumer financing activities continu- activities appear to be eligible for retention on the ously since June 30, 1968, these activities appear basis of grandfather privileges. to be eligible for retention on the basis of grandfa- C.I.T. engages in certain insurance agency and ther privileges.3 underwriting activities. Through two subsidiaries, C.I.T. underwrites life and health insurance on individuals and groups that is sold through general agents; and underwrites directly and as reinsurer 3C.I.T. acquired, as going concerns, certain consumer fi- credit life and credit accident and health insurance nance subsidiaries between June 30, 1968 and December 31, written in connection with consumer sales finance 1970. Although C.I.T.'s finance activities appear to be eligible transactions and consumer personal loans. Total for retention on the basis of grandfather privileges, the provisions of §§ 4(a)(2) and 4(c)(ll) of the Act preclude the assets of these companies at year-end 1975 were retention beyond December 31, 1980, of interests in or assets approximately $225.1 million. C.I.T. also enof going concerns acquired by a bank holding company between June 30, 1968 and December 31, 1970. Accordingly, gages, through a subsidiary, in the underwriting in order for C.I.T. to retain these subsidiaries, Board approval of property and casualty insurance against fire, must be obtained pursuant to one of the exemptions provided theft, collision and other physical damage risks, in § 4(c) of the Act. The Board's determination with respect to C.I.T.'s grandfather privileges does not imply present or primarily on mobile homes, motor vehicles, recfuture approval of any such application for retention that C.I.T. reational vehicles, and household goods which are may file, since each would be separately considered by the Board on the basis of the statutory factors set forth in the Act. In addition, C.I.T. acquired a number of de novo finance company subsidiaries on dates between June 30, 1968 and December 31, 1970. Section 4(c)(ll) of the Act, in effect, exempts the creation of de novo companies engaged in indefinitely grandfathered activities from the prohibitions of section Amendments and the section 4(c)(ll) exemption contained 4 of the Act. While it may be argued that this section would therein. In view of this, the Board believes that a proper apply only to de novo companies acquired subsequent to the interpretation of section 4(c)(ll) would apply the exemption addition of this section of the Act, i.e., subsequent to De- of that section to the pre-December 31, 1970 de novo compacember 31, 1970, the Board notes that the only distinction nies and that no useful purpose would be served by requiring between the de novo companies acquired prior to December C.I.T. to apply for retention of those companies. Accordingly, 31, 1970, and the de novo companies acquired subsequent to C.I.T. may retain the finance company subsidiaries acquired that date is the intervention of the enactment of the 1970 de novo between June 30, 1968 and December 31, 1970. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 81 collateral security for credit extended by subsidi- representatives or distributors in more than 70 aries of C.I.T. The subsidiary also underwrites foreign countries. Gibson Greeting Cards, Inc. such risks on direct sales made by agents and (assets of $121.8 million, as of December 31, participates in insurance pools involving primary 1975), manufactures and distributes greeting and reinsurance risks for multiple lines of insur- cards, gift wrapping, and other assorted related ance. In addition, C.I.T. engages in the activity products. The executive offices are located in Cinof acting as agent for the sale of insurance for cinnati, Ohio, and the principal manufacturing C.I.T. and its subsidiaries. C.I.T. does not act facilities are located in Cincinnati, Ohio, and as agent with respect to the sale of insurance to Memphis, Tennessee. Sales facilities are located the general public except in connection with ex- throughout the United States. Ail-Steel Inc. (assets tensions of credit by C.I.T.'s subsidiaries, and of $34.9 million, as of December 31, 1975), does not hold itself out as a general insurance manufactures and distributes metal office furniture. agent. Since C.I.T. was engaged in the foregoing Two affiliates of All-Steel Inc. manufacture and insurance agency and underwriting/reinsurance distribute metal office furniture and equipment in activities on June 30, 1968, and continuously Canada. The executive offices and principal manthereafter, these activities appear to be eligible for ufacturing operations of Ail-Steel Inc. are located retention on the basis of grandfather privileges. in Aurora, Illinois; sales facilities are located C.I.T. engages, through subsidiaries, in leasing throughout the United States. Raco, Inc. (assets activities with respect to real property, and had of $20.4 million, as of December 31, 1975), real property lease receivables of $25.3 million manufactures electrical outlet, junction and switch at year-end 1975. The subsidiaries lease, on a boxes and related fittings. Its executive offices and full-payout basis, such real property as buildings principal manufacturing operations are located in for hospital, extended care and geriatric use; re- South Bend, Indiana; sales representatives and lated medical facilities; and residence and dining distributors are located throughout the United halls for educational institutions. C.I.T. was en- States. It appears that C.I.T. was engaged in the gaged in the leasing of real property on a full- above-mentioned manufacturing and merchandispayout basis on June 30, 1968, and has engaged ing activities on June 30, 1968, and has been in this activity continuously thereafter. Accord- engaged in these activities continuously thereafter. ingly, this activity appears to be eligible for reten- Accordingly, these activities appear to be eligible tion on the basis of grandfather privileges. While for retention on the basis of grandfather privi- C.I.T. engages to some extent in the leasing of leges.4 In addition, one subsidiary of The Picker real property on a non-full-payout basis, this ac- Corporation, Picker Briggs Corporation, Clevetivity has not been engaged in continuously since land, Ohio, was acquired as a going concern after June 30, 1968, and C.I.T. is not entitled to, nor June 30, 1968. Accordingly, pursuant to the prodoes it make any claim to, grandfather privileges visions of section 4(a)(2) of the Act, C.I.T. may with respect to this activity. not retain Picker Briggs Corporation beyond De- C.I.T. owns subsidiaries that engage in various cember 31, 1980. manufacturing and merchandising activities (com- C.I.T. engages directly in data processing acbined assets of $358.8 million at year-end 1975). tivities including the sale or sublease of computer The Picker Corporation (assets of $191.6 million time, the provision of payroll processing services, as of December 31, 1975), manufactures and sup- life insurance file processing, accounting and deplies to the medical profession, clinics, and hospi- livery scheduling and similar automated data protals a varied line of x-ray apparatus, equipment and accessories manufactured by others. It also produces ultrasonic devices and nuclear instrumentation and radioactive isotope devices for 4 This determination is not authority to enter into any new activities that were not engaged in on June 30, 1968, and clinical diagnosis and laboratory and therapy uses. continuously thereafter. The Board does not regard "manufac- C.I.T. states that the Picker Corporation's execu- turing" as an activity in and of itself for purposes of grandfative offices and principal manufacturing facility are ther privileges pursuant to section 4(a)(2), but rather looks to the product lines of manufacturing in which a Registrant has located in Cleveland, Ohio; that sales and service been continuously engaged since June 30, 1968. While the facilities include 26 offices located throughout the Board believes that C.I.T. may incorporate technological im- United States and 12 offices throughout Canada; provements to existing product lines, C.I.T. may not expand such product lines without Board concurrence that such expanand that there are wholly-owned subsidiaries, sales sion is consistent with C.I.T.'s grandfather privileges. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-82 Federal Reserve Bulletin • January 1977 cessing services, and the sale or licensing of soft- Board does not believe that C.I.T.'s investment ware initially developed by C.I.T. for its own use. in these limited partnerships can be properly In 1975 C.I.T. had receivables of $75,179 as a viewed as a form of general business lending. In result of the data processing services provided to particular, it is noted that in a lending transaction, firms not affiliated with C.I.T. Since C.I.T. has the lender does not receive direct income tax engaged in this activity continuously since June benefits in the form of interest deductions and 30, 1968, it appears to be eligible for retention depreciation, as C.I.T. does in this instance. Acon the basis of grandfather privileges. cordingly, given the nature of such interests, the C.I.T., directly and through subsidiaries, makes Board views C.I.T.'s participation in the developventure capital investments. These venture capital ment and management of real estate through these investments are made either directly to the bor- limited partnerships as an activity different in form rowing companies, or indirectly through the me- and substance from that of general business lenddium of limited partnerships in which C.I.T. in- ing. Since this activity was commenced after June vests equity capital as a limited partner. C.I.T. 30, 1968, C.I.T. is not entitled to indefinite does not claim grandfather privileges for the ven- grandfather privileges with respect to it and may ture capital investments that it makes directly and not retain such interests beyond December 31, has stated that all such investments will be brought 1980. Of course, this Determination does not below 5 per cent of the shares of any company preclude C.I.T. from filing an application pursuant by December 31, 1980. With respect to C.I.T.'s to section 4(c)(8) of the Act for retention of such interests in limited partnerships, such activities interests nor does it constitute a finding by the have not been engaged in continuously since June Board that such interests would be permissible 30, 1968 and are not eligible for retention on the under that section. basis of grandfather privileges.5 C.I.T. has caused to be created three charitable C.I.T. has invested, since 1970, through its foundations that are engaged primarily in charitasubsidiary C.I.T. Realty Corporation, in two lim- ble activities, including making grants to instituited partnerships organized to construct and tions organized exclusively for religious, charitaoperate moderate and low income apartment proj- ble, scientific, literary, or educational goals. Since ects in New York City under the Private Housing these foundations were created prior to June 30, Finance Law of the State of New York. C.I.T. 1968, C.I.T. may continue its relationship with has an aggregate 95 per cent investment in both them on the basis of indefinite grandfather author limited partnerships. In return, C.I.T., through its ity. subsidiary, obtains 90 per cent of the tax benefits In addition to the above-described activities, accruing to the partnerships, such as interest de- C.I.T., from time to time, makes acquisitions in ductions and depreciation. C.I.T. claims grandfa- satisfaction of debts previously contracted ther privileges for these investments on the ground ("dpc"), which include acquisitions of more than that this is nothing more than a traditional but 5 per cent of the shares of stock of certain compainnovative form of financing; i.e., a business fi- nies.7 C.I.T. asserts a claim to making and holding nance transaction similar in substance to those for "dpc" acquisitions as a necessary and incidental which C.I.T. has grandfather privileges.6 The part of its indefinitely grandfathered lending activities. Accordingly, C.I.T. asserts that the acquisitions which it makes or holds "dpc" may be retained on the basis of grandfather privileges 5C.I.T. also claims exemptions for holding these limited without limitation or restriction, regardless of partnership interests under other provisions of the Act. The whether such acquisitions were made before or question of the applicability of those exemptions to limited partnership interests is under consideration. However, the volume and scope of C.I.T.'s venture capital limited partnership interests amount to approximately $3.25 million and the Board does not regard them of sufficient magnitude to warrant delay of this Determination pending resolution of that issue. 6C.I.T. also claims sections 4(c)(6) and 4(c)(7) as possible engaging in an activity without Board approval, the provisions exemptions for these limited partnership interests; however, of sections 4(c)(6) and 4(c)(7), which are intended to exempt the Board concludes that these exemptions are not available small passive investments, do not provide authority for this to C.I.T. After examining the nature and scope of C.I.T.'s activity. involvement in the business of these partnerships, the Board 7By virtue of Section 4(c)(6) of the Act, the acquisition has determined that C.I.T. must be deemed to be engaged of 5 per cent or less of the outstanding voting shares of any in that business. Because section 4(a)(2) of the Act prohibits company is exempt from the prohibitions of Section 4. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 83 after December 31, 1970. While the Board agrees or any subsidiary thereof shall not be subject to that a bona fide i4dpc" acquisition may be re- any condition which, if imposed by a bank, would garded as normal, necessary and incidental to the constitute an unlawful tie-in arrangement under business of lending, holding such "dpc" interests Section 106 of the Bank Holding Company Act without restriction or limitation is not integral or Amendments of 1970. necessary to the business of lending. Thus, the The determination herein does not preclude a Board rejects C.I.T. 's contention that holding such later review, by the Board, of Registrant's nonproperty without restriction or limitation is within bank activities and a future determination by the the scope of the grandfathered lending activities.8 Board in favor of termination of grandfather bene- On the basis of the foregoing and all the facts fits of Registrant. The determination herein is before the Board, it appears that the volume, subject to the Board's authority to require modifiscope, and nature of the activities of Registrant cation or termination of the activities of Registrant described herein do not demonstrate an undue or any of its nonbanking subsidiaries as the Board concentration of resources, decreased or unfair finds necessary to assure compliance with the competition, conflicts of interest, or unsound provisions and purposes of the Act and the Board's banking practices. regulations and orders issued thereunder, or to There appears to be no reason to require Regis- prevent evasion thereof. trant to terminate its grandfathered interests. It is By determination of the Board of Governors, the Board's judgment that, at this time, termina- effective December 20, 1976. tion of the grandfather privileges of Registrant described herein is not necessary in order to pre- Voting for this action: Chairman Burns and Governors Gardner, Wallich, Coldwell, Jackson, Partee, and vent an undue concentration of resources, de- Lilly. creased or unfair competition, conflicts of interest, or unsound banking practices. This determination (Signed) GRIFFITH L. GARWOOD, is not authority to enter into any new activity or [SEAL] Deputy Secretary of the Board. product extension that was not engaged in on June 30, 1968, and continuously thereafter, or any Order Under Bank Merger Act activity that is not the subject of this determination. Bank of New Orleans and Trust Company, A significant alteration in the nature or extent New Orleans, Louisiana of Registrant's activities or a change in location thereof (significantly different from any described Order Approving Acquisition of Assets in this determination) will be cause for a revalua- Bank of New Orleans and Trust Company, New tion by the Board of Registrant's activities under Orleans, Louisiana, a State member bank of the the provisions of Section 4(a)(2) of the Act, that Federal Reserve System, has applied, pursuant to is, whenever the alteration or change is such that the Bank Merger Act (12 U.S.C. 1828 (c)), for the Board finds that a termination of the grandfathe Board's prior approval to acquire certain assets ther privileges is necessary to prevent an undue and assume certain liabilities of International City concentration of resources or any of the other Bank and Trust Company, New Orleans, Louiadverse consequences at which the Act is directed. siana ($165 million in deposits1), and, as an inci- No merger, consolidation, acquisition of assets dent thereto, to operate the present offices of other than in the ordinary course of business, nor International City Bank and Trust Company as acquisition of any interest in a going concern, to branch offices. which the Registrant or any nonbank subsidiary Published notice of the proposed acquisition of thereof is a party, may be consummated without assets and assumption of liabilities and requests prior approval of the Board. Further, the provision for reports on the competitive factors involved of any credit, property, or service by the Registrant therein have been dispensed with as authorized by the Bank Merger Act. The Board has considered all relevant material contained in the record in the light of the factors 8 The Board is considering the question of the permissible time period that should be allowed for the holding of "dpc" acquisitions. The Board's determination with respect to that question will be announced at a later date. 1 Deposit data are as of December 31, 1975. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-84 Federal Reserve Bulletin • January 1977 set forth in the Act, including the effect of the (12 U.S.C. 321-338) and the Board's Regulation proposal on competition, the financial and mana- H (12 CFR 208), to become a member of the gerial resources and prospects of the banks in- Federal Reserve System. On November 10, 1976, volved, and the convenience and needs of the the Board notified Applicant that the application communities to be served and finds that: was approved and that the Board would issue a On the basis of the information before the statement regarding the approval action. Board, it is apparent that an emergency situation Applicant, which has not yet opened for busiexists so as to require that the Board act immedi- ness, was organized in 1975 for the purpose of ately pursuant to the provisions of the Bank obtaining a State bank charter and engaging in a Merger Act in order to safeguard depositors of commercial banking business. It filed a charter International City Bank and Trust Company. application in August 1975, which was approved Such anticompetitive effects as will be attrib- by the State Banking Department of Alabama by utable to consummation of the transaction will be letter dated November 18, 1975. Approximately clearly outweighed in the public interest by con- one year earlier, in December 1974, a charter siderations relating to and involved in the emer- application filed on behalf of Applicant by subgency situation found to exist. From the record stantially the same organizers was denied by the in the case, it is the Board's judgment that any State Banking Department of Alabama. Approval disposition of the application other than approval of Applicant's charter in November 1975 was would be inconsistent with the best interests of conditioned in part upon Applicant obtaining inthe depositors of International City Bank and Trust surance coverage for its deposits from the Federal Company, and the Board concludes that the pro- Deposit Insurance Corporation ("FDIC"). In anposed transaction should be approved on a basis ticipation of this requirement, Applicant had filed that would not delay consummation of the pro- an application for insurance in August 1975, purposal. suant to Section 5 of the Federal Deposit Insurance It is hereby ordered, on the basis of the record, Act (12 U.S.C. 1815). That application was withthat the application be and hereby is approved and drawn by Applicant in March 1976, after a formal that the acquisition of assets and assumption of hearing was held at the request of persons protestliabilities and the establishment of the branch ing the application. Consequently, the FDIC ended offices may be consummated immediately but in its consideration of the matter without making a no event later than three months after the date of final determination. this Order unless such period is extended for good Under Section 9 of the Federal Reserve Act, cause by the Board, or by the Federal Reserve the Board, in acting upon an application to become Bank of Atlanta pursuant to delegated authority. a member of the Federal Reserve System, is re- By order of the Board of Governors, effective quired to consider the financial condition of the December 4, 1976. applying bank, the general character of its management, and whether or not the corporate powers Voting for this action: Chairman Burns and Goverof the institution are consistent with the purpose nors Gardner, Wallich, Coldwell, and Lilly. Absent and of the Federal Reserve Act. In addition, under not voting: Governors Jackson and Partee. Section 4(b) of the Federal Deposit Insurance Act (Signed) THEODORE E. ALLISON, (12 U.S.C. 1814), the admission to membership [SEAL] Secretary of the Board. in the Federal Reserve System of an uninsured State bank automatically confers deposit insurance Statement Regarding an upon the bank from the time the Board certifies Application to Become a to the FDIC that the bank is a member of the Member of the Federal Reserve System Federal Reserve System. The Board's certificate to the FDIC is required to state that the Board Citizens Bank and Trust Company, has given consideration to the factors enumerated Alabaster, Alabama in Section 6 of the Federal Deposit Insurance Act Citizens Bank and Trust Company, Alabaster, (12 U.S.C. 1816), namely, the financial history Alabama ("Applicant"), a new bank chartered and condition of the bank; the adequacy of the under the laws of the State of Alabama, applied, capital structure; the bank's future earnings prospursuant to Section 9 of the Federal Reserve Act pects; the general character of its management; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 85 the convenience and needs of the community to Presently, Protestants operate six banking be served by the bank; and whether or not the offices in Shelby County. Despite the fact that most bank's corporate powers are consistent with the of the services that would be provided by Applipurposes of the Federal Deposit Insurance Act. cant are currently being offered by Protestants, the The Board has considered the subject applica- record reflects a desire on the part of a significant tion and all comments received with respect number of local residents for a locally owned bank thereto, including those submitted in opposition such as Applicant. On the other hand, Protestants to the application by First Bank of Alabaster, have indicated that there is no present need for Alabaster, Alabama, First Shelby National Bank another bank in Shelby County, particularly in and Shelby State Bank, both of Pelham, Alabama, view of the fact that First Shelby National Bank, and Merchants and Planters Bank, Montevallo, Pelham, Alabama, opened for business in Febru- Alabama (hereinafter referred to as "Protes- ary 1976, in temporary quarters approximately 2>l/i tants"). miles north of Applicant's proposed location. Alabaster is located in central Alabama, in However, it appears that First Shelby National Shelby County (population 38,037 as of the 1970 Bank has experienced reasonable growth, with census). Applicant's proposed service area is ap- deposits of $2.4 million as of June 30, 1976, and proximated by the northern portion of Shelby that the addition of Applicant as another banking County, including Alabaster and the towns of alternative would not significantly affect First Helena and Pelham. During the past several years, Shelby National Bank's future growth prospects. Shelby County has experienced significant popu- In addition, Applicant has committed to delay lation growth and a transition from an agricultural opening for business until its permanent quarters economy to a more diversified economy. The have been constructed. Based on the local ecopopulation of Shelby County has grown from nomic conditions and the apparent local support 32,132 in 1960 to 38,037 in 1970, and to an the Applicant would enjoy, the Board concludes estimated 50,000 in 1974. Alabaster itself pres- that considerations with regard to the convenience ently has a population of about 5,200 and a trade and needs of the community to be served by area population (not including Helena and Pelham) Applicant are consistent with approval of the subof approximately 14,000. The trade area of Pel- ject application. ham, Helena and Alabaster represents approxi- Applicant has no operating history, and its fumately 50 per cent of Shelby County's population ture earnings prospects are, of course, related to and generally reflects the migration into the county the amount of deposits it will be able to attract. from neighboring Jefferson County and the city As mentioned above, there are indications in the of Birmingham, which is approximately 25 miles record of strong community support for a new directly north of Alabaster. bank in Alabaster. The initial stock offering of Another indication of the area's growth is the $1,250,000 by Applicant was fully subscribed, increase in housing starts in Alabaster from 60 in with each subscriber limited to purchasing four 1972 to 137 in 1975. Also, Alabaster has fourteen percent of the offering. From the list of 85 subbusinesses and industries with employment of scribers submitted by Applicant, it appears that nearly 1,800 and a combined annual payroll of many of the subscribers are owners or presidents approximately $12 million. In addition, informa- of businesses or professionals or other selftion from the Alabama Power Company indicates employed individuals who will be able to provide that presently the northern half of Shelby County Applicant with an initial nucleus of customers to is adding approximately 100 customers per month, serve. In the Board's judgment, such expressions a 10 per cent per annum increase. The record of local support are a positive factor not only with indicates that Route 1-65, to the east of and parallel respect to the convenience and needs of the comto the site of Applicant's proposed office on High- munity but also with respect to the future earnings way 31, is due for completion by 1981. With the prospects of Applicant. completion of Route 1-65, the areas in the northern In assessing the future earnings prospects of half of Shelby County to be served by Applicant Applicant, the Board also considered the views can be expected to experience further develop- of the State Banking Department, the Federal ment, both residential and industrial. Reserve Bank of Atlanta and the Board's staff, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-86 Federal Reserve Bulletin • January 1977 all of which project that Applicant will achieve plicant's opening would have on First Shelby profitability1 by the end of its third year of opera- National Bank are overly pessimistic, particularly tion.2 The Protestants have indicated that Appli- in view of First Shelby National Bank's deposit cant would not achieve profitability in that period figures mentioned above and the generally optidue primarily to lower deposit projections than mistic economic outlook for the Alabaster area. were used by the above organizations and to the Thus, the Board concluded that Applicant's future fact that a new bank, First Shelby National Bank, earnings prospects are consistent with approval of recently opened in the Alabaster area and the the subject application. opening of another bank would have an adverse While Applicant has no operating or financial effect on First Shelby National Bank. In the history, it appears that it would open with adequate Board's opinion, Protestants' projections with re- capital structure. The general character of Applispect to deposits of Applicant are low and Protes- cant's management also appears satisfactory, and tants' concerns about the adverse impact that Ap- the corporate powers of Applicant are consistent with the Federal Reserve Act and the Federal 1Under applicable State law, the Superintendent of the State Deposit Insurance Act. Banking Department, before granting a certificate, is required For the foregoing reasons, the Board approved to satisfy himself that there is sufficient business to support Applicant's application to become a member bank the proposed bank in the community, Code of Alabama, Tit. 5 § 88. Approval of Applicant's charter application therefore in the Federal Reserve System. reflects a favorable determination by State authorities with regard to the future earnings prospects of Applicant. 2 Comments on the Applicant were requested of the FDIC regional office in Atlanta, and the response from the FDIC to the Federal Reserve Bank of Atlanta indicated merely that (Signed) THEODORE E. ALLISON, upon Applicant's withdrawal of its earlier insurance application, the FDIC's files were closed. [SEAL] Secretary of the Board. ORDERS APPROVED UNDER BANK HOLDING COMPANY ACT By the Board of Governors During December 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 Administration 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 Boyden Bancorp, Boyden, Farmers Savings 12/13/76 41 F.R. 55382 Iowa Bank, Boyden, 12/20/76 Iowa Northwest Bancorporation, First National 12/27/76 42 F.R. 853 Minneapolis, Minnesota Bank of Ottumwa, 1/4/77 Ottumwa, Iowa Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 87 Section 4 Board action Federal Nonbanking company (effective Register Applicant (or activity) date) citation First National Charter Charter Bankers 12/8/76 41 F.R. 55239 Corporation, Kansas City, Life Insurance 12/17/76 Missouri City, Missouri By Federal Reserve Banks During December 1976, an 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. Section 3 Federal Reserve Effective Register Applicant Bank(s) Bank date citation Ameribanc, Inc., Consolidated Kansas City 12/21/76 42 F.R. 853 St. Joseph, Bancshares of 1/4/77 Missouri Missouri, Inc., St. Joseph, Missouri PENDING CASES INVOLVING THE BOARD OF GOVERNORS* National Automobile Dealers Association, Inc. v. North Lawndale Economic Development Cor- Board of Governors, filed November 1976, poration v. Board of Governors, filed June U.S.C.A. for the District of Columbia. 1976, U.S.C.A. for the 7th Circuit. Michigan National Corporation v. Board of Gov- Central Wisconsin Bankshares, Inc. v. Board of ernors, filed September 1976, U.S.C.A. for the Governors, filed June 1976, U.S.C.A. for the 6th Circuit. 7th Circuit. First Security Corporation v. Board of Governors, National Urban League, et al. v. Office of the filed August 1976, U.S.C.A. for the 10th Cir- Comptroller of the Currency, et al., filed April cuit. 1976, U.S.D.C. for the District of Columbia Anthony R. Martin-Trigona v. Board of Gover- Circuit. nors, filed August 1976, U.S.C.A. for the Dis- Farmers & Merchants Bank of Las Cruces, New trict of Columbia. Mexico v. Board of Governors, filed April First State Bank of Clute, Texas, et al. v. Board 1976, U.S.C.A for the District of Columbia of Governors, filed July 1976, U.S.C. A. for the Circuit. 5th Circuit. Grandview Bank & Trust Company v. Board of International Bank v. Board of Governors, et al., Governors, filed March 1976, U.S.C.A. for the filed July 1976, U.S.D.C. for the District of Eighth Circuit. Columbia. Association of Bank Travel Bureaus, Inc. v. Board of Governors, filed February 1976, U.S.C.A. for the Seventh Circuit. Memphis Trust Company v. Board of Governors, *This list of pending cases does not include suits against filed Feburary 1976, U.S.D.C. for the Western the Federal Reserve Banks in which the Board of Governors is not named a party. District of Tennessee. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-88 Federal Reserve Bulletin • January 1977 International Bank v. Board of Governors, filed nors, tiled August 1975, actions consolidated December 1975, U.S.C.A. for the District of in U.S.C.A. for the Fifth Circuit, Columbia. tt David R. Merrill, et al. v. Federal Open Mar- Roberts Farms, Inc. v. Comptroller of the Cur- ket Committee of the Federal Reserve System, rency, et al., filed November 1975, U.S.D.C. filed May 1975, U.S.D.C. for the District of for the Southern District of California. Columbia, appeal pending, U.S.D.A. for the National Computer Analysts, Inc. v. Decimus District of Columbia. Corporation, et al., filed November 1975, CurvinJ. Trone v. United States, filed April 1975, U.S.D.C. for the District of New Jersey. U.S. Court of Claims. t Peter E. Blum v. First National Holding Cor- Louis J. Roussel v. Board of Governors, filed poration, filed May 1976, U.S.C.A. for the April 1975, U.S.D.C. for the Eastern District Fifth Circuit. of Louisiana. tPeter E. Blum v. Morgan Guaranty Trust Co., Georgia Association of Insurance Agents, et al. et al, filed April 1976, U.S.C.A. for the Fifth v. Board of Governors, filed October 1974, Circuit. U.S.C.A. for the Fifth Circuit. tLogan v. Secretary of State, et al., filed Sep- Alabama Association of Insurance Agents, et al. tember 1975, U.S.D.C. for the District of Co- v. Board of Governors, filed July 1974, lumbia. U.S.C.A. for the Fifth Circuit, Florida Association of Insurance Agents, Inc., v. tInvestment Company Institute v. Board of Gov- Board of Governors, and National Association ernors, dismissed July 1975, U.S.D.C. for the of Insurance Agents, Inc. v. Board of Gover- District of Columbia, appeal pending, U.S.C. A. for the District of Columbia Circuit, t Consumers Union of the United States, Inc., et al. v. Board of Governors, filed September 1973, U.S.D.C. for the District of Columbia. t Decisions have been handed down in these cases, subject Bankers Trust New York Corporation v. Board to appeals noted. of Governors, filed May 1973, U.S.C.A. for t$The Board of Governors is not named as a party in this the Second Circuit. action. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

89 Announcements CHANGE IN RESERVE of the existing regulation remain in effect until REQUIREMENTS March 23, 1977. The amendments by the Congress in 1976 The Board of Governors of the Federal Reserve broadened the scope of the act to prohibit discrim- System announced on December 17, 1976, a ination in credit transactions on seven new bases:1 structural adjustment in reserve requirements on race, color, religion, national origin, age, receipt demand deposits. Required reserves will be re- of income from public assistance programs, and duced by about $550 million as a result of the good faith exercise of rights under the Consumer move, which will reduce reserve requirements of Protection Act of 1968 (which includes the Truth member banks by lh of a percentage point on their in Lending, Fair Credit Billing, Equal Credit Opdemand deposits up to $10 million and by lA of portunity, Fair Credit Reporting, and Consumer a percentage point on their demand deposits above Leasing Acts). that amount. This action will tend to increase the The act directs the Federal Reserve to write supply of bank credit. regulatory rules to execute it. The Board's rules The reserve requirement percentages will be as on equal credit opportunity are enforced by 12 follows: Federal agencies, including the Board. Consumers with complaints of discriminatory treatment in Net demand deposits Old New credit transactions should inform the appropriate (in millions of dollars) Federal agency in writing, by telephone, or in person. 0-2 IV2 1 2-10 10 9V2 The Board adopted the revised Regulation B 10-100 12 11% after extensive consultations with consumer and 100-400 13 12% Over 400 I6V2 16VA creditor groups and a 2-day hearing at which testimony was presented by 33 individuals, con- The Board's action would apply to net demand sumer and creditor representatives, the Department deposits held by member banks during the week of Justice, and other governmental agencies. The of December 16-22. Under the lagged reserve Board published for public comment proposed new system currently in effect, the reserves required equal credit opportunity regulations to implement would decline 2 weeks later, during the week of the 1976 amendments to the act on July 15 and December 30-January 5. a revision of these proposals on November 3. The revised Regulation B takes account of some 1,100 comments received on the Board's proposals, and REGULATION B: Amendment of suggestions made at a meeting of the Board's Consumer Advisory Council on November 10 and The Board of Governors on December 29, 1976, 11. announced revision of its Regulation B (Equal The principal features of Regulation B, as re- Credit Opportunity) to carry out the 1976 amendvised to carry out the 1976 amendments to the ments to the Equal Credit Opportunity Act Equal Credit Opportunity Act, are as follows. (ECO A). The revised act and the revised regulation will become effective March 23, 1977. At that time 1A footnote in the regulation (Sec. 202.6 (a)) notes the revised regulation will supersede the existing that the legislative history of the act indicates that the Regulation B in its entirety. The existing regula- Congress intended that an "effects text," such as has been developed in application of equal employment tion, like the original ECO A, deals only with opportunity law, be applicable in determining whether discrimination in the extension of credit on the a creditor's judgment of creditworthiness is or is not basis of sex or marital status. The requirements discriminatory. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-90 Federal Reserve Bulletin • January 1977 Adverse action has not occurred when the GENERAL RULE creditor— PROHIBITING DISCRIMINATION 1. Makes a change in the terms of an account The regulation specifies that "a creditor shall not that is expressly agreed to by the applicant. discriminate against an applicant on a prohibited 2. Takes any action, or forbears to take an basis regarding any aspect of a credit transaction." action, in connection with inactivity, default, or Discrimination is defined as "to treat an appli- delinquency in the account. cant less favorably than other applicants."2 This 3. Refuses to extend credit requested at the point general rule applies to everyone who is a creditor. of sale or of making of a loan because the credit Creditors are relieved from some of the mechanical requested would exceed a previously established requirements of the regulation, however, when credit limit. (A point-of-sale refusal is an adverse extending certain types of credit, as presented later action if it is made for any reason except for under the discussion of special treatment and spe- exceeding the previously established credit limit.) cial-purpose programs. A creditor is "a person 4. Refuses to extend credit not allowed by who, in the ordinary course of business, regularly applicable law. participates in the decision of whether or not to 5. Refuses to extend a type of credit the creditor extend credit." does not offer. After taking adverse action, the creditor must send the applicant a written notice as specified in ADVERSE ACTION the regulation (Section 202.9) and in this an- Regulation B, as revised, defines what does and nouncement under the headings Notice of Action does not constitute adverse action on an applica- Taken and Statement of Specific Reasons. tion for credit.3 The main features of the definition are: DATA NOTATION FOR Adverse action has been taken when a credi- ENFORCEMENT PURPOSES tor— 1. Has declined to grant credit in substantially The Board adopted, almost unchanged, the prothe amount or on substantially the terms requested posal it made in November to add a new section by the applicant, unless the applicant accepts a to Regulation B requiring creditors to inquire as counter offer by the creditor. to the sex, marital status, race-national origin, 2. Terminates an account, or makes an unfa- and age of applicants for residential mortgage vorable change in terms (such as the interest rate, credit, but with the proviso that applicants have number of payments, and so forth) that does not the right to decline to supply such information if apply to all or most of that creditor's accounts. they wish. The inquiries are to be made only with respect to applications for the purchase of mortgage credit on 1- to 4-family residences. The race 2A footnote in the section of the regulation (Sec. or national origin categories to be used are: 202,2 (z)) dealing with the prohibited bases of discrim- American Indian or Alaskan Native, Asian or ination says in part: Pacific Islander, Black, White, Hispanic, or Other. The definition (of prohibited bases) is not limited If the applicant elects to use "Other," the applito characteristics of the applicant . . . but refers cant may specify any desired category. The marital also to the characteristics of individuals with whom the applicant deals. This means, for ex- status categories to be requested are married, unample, that, under the general rule (against dis- married, or separated. The questions, at the credicrimination) a creditor may not discriminate tor's option, may be listed on the application form against a non-Jewish applicant because of that person's business dealings with Jews, or dis- or on a separate form that refers to the application. criminate against an applicant because of the This information may be used for enforcement characteristics of persons to whom the extension purposes only. of credit relates (for example, the prospective tenants in an apartment complex to be constructed The Board added a provision4 that any agency with the proceeds of the credit requested), or with enforcement responsibilities under the act because of the characteristics of other individuals residing in the neighborhood where the property may substitute its own monitoring program for that offered as collateral is located. . . . in Regulation B. 3 Not in existing Regulation B but similar to the November proposal for amending the regulation. 4Not in the Board's July or November proposals. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 91 MEASURES TO such a system may be based, but the borrowed AVOID DISCRIMINATION system must be validated from the creditor's own experience, at once or as soon as the creditor's ON THE BASIS OF AGE own experience is available. The amended act provides that it is not discrim- A system that is not proved valid by using the inatory to consider age in a credit-scoring system creditor's own experience shall not be considered based on experience if the system is demonstrably a demonstrably and statistically sound, empirically and statistically sound in accordance with the derived, credit-scoring system from that point in Board's regulations, so long as the system does time. not operate to assign the age of an elderly applicant a "negative factor of value." JUDGMENTAL EVALUATION To implement this new provision of the act the OF APPLICANTS Board: 1. Added a new definition in Regulation B, The act permits creditors to use, instead of a stating that a negative factor or value, in relation credit-scoring system, their own judgment as to to age in a credit-scoring system, would be one the creditworthiness of an applicant. This may that gives an elderly applicant for credit an age include inquiries by the creditor as to the appliscore less favorable than the creditor's experience cant's age and whether the applicant's income warrants, or less favorable than the score, on comes from a public assistance program. These account of age, given by the creditor to any age inquiries may be made by a creditor making a group that is not elderly. judgmental evaluation of an applicant, but only 2. Defined elderly as age 62 or over. as a means of determining pertinent facts about Thus, applicants age 62 or older may not be the applicant's ability to repay the credit applied given a score for their age that is lower than the for; that is, creditworthiness. Thus, a creditor best score assigned to any nonelderly group. using a judgmental system may not use elderliness For ages 62 and above, scores may vary ac- or the fact that an applicant's income comes from cording to the creditor's experience, so long as public assistance as sufficient factors, in themthey are not less than the best score assigned any selves, to deny credit.5 group below 62. CREDIT-RELATED INSURANCE MAIN CHARACTERISTICS OF A NONDISCRIMINATORY Regulation B permits differentiation in the availability, rate, and terms of credit-related insurance CREDIT-SCORING SYSTEM (casualty, life, health, accident, and disability) One, it must be empirically derived. Regulation offered to applicants for credit. B describes this as meaning a credit-scoring sys- However, the regulation also provides that tem that evaluates creditworthiness primarily by creditors may not deny credit or terminate an allocating points (or some other means of assign- account because such insurance is not available ing weights) to key attributes of the applicant and due to an applicant's age. the credit. In applications for such insurance, information Two, it must also be demonstrably and statisti- may be requested about the applicant's age, sex, cally sound. Regulation B requires that such a and marital status.6 system: (1) be developed by using either the creditor's entire population of applicants or data groups 5 This section is new in Regulation B. It varies from obtained by properly sampling that population; (2) the Board's November proposal chiefly in making it predict creditworthiness with respect to the busiclear that the definition of pertinent element of creditness interests of the creditor; (3) be validated worthiness applies only where a judgmental evaluation during the development process as to its predictive of an applicant's creditworthiness is being made. ability; and (4) be thereafter revalidated at what- 6 The proviso forbidding creditors to deny or terminate ever regular intervals are necessary. credit because credit-related insurance is not available due to the applicant's age, and the admissibility of A creditor may borrow a demonstrably and questions on insurance application regarding age, sex, statistically sound, empirically derived creditand marital status were not part of the November proscoring sytem, or the credit experience on which posal. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-92 Federal Reserve Bulletin • January 1977 SPECIAL-PURPOSE marital status, income from alimony, child support, separate maintenance, and the spouse's fi- CREDIT PROGRAMS7 nancial resources may be made and considered in This section of Regulation B is meant to make determining eligibility of applicants to participate room, under the law, for credit programs de- in the program. signed—without intent to evade the Equal Credit Opportunity Act—to benefit special groups of RELATION TO STATE LAW8 economically disadvantaged persons or to meet special social needs even though such programs The regulation states as a general rule that it alters, may exclude some groups that the act protects affects, or pre-empts only those State laws that from discrimination in the extension of credit. For are inconsistent with the regulation and then only example, a program designed to benefit disadvan- to the extent of the inconsistency. A State law taged American Indians may exclude non-Indians. is not inconsistent with the regulation if it differs But such a program may not discriminate on the by being more protective of the applicant than is basis of marital status. Federal law. Such programs may not discriminate on any of Together with Regulation B, the Board issued the bases prohibited under the act and Regulation a supplement to the regulation setting forth in B, except that all participants in a special-purpose detail the procedures and criteria under which a credit program may be required to have in common State may seek an exemption. one or more characteristics, so long as this exclusion of other characteristics was not designed to SPECIAL TREATMENT OF circumscribe equal credit opportunity laws. SOME TYPES OF CREDIT9 Special-purpose credit programs eligible under this provision of Regulation B are: Regulation B permits partial exemptions from the 1. Any credit assistance program expressly au- general prohibitions of the regulation for transacthorized by Federal or State law for the benefit tions involving public utilities credit, securities of an economically disadvantaged class of persons. credit, incidental credit,10 business credit, and 2. Any credit assistance program operated by credit extended to governments. These are set forth a not-for-profit organization, as defined by the in Section 202.8 of the regulation. Internal Revenue Code of 1954, for the benefit of its members or of an economically disadvan- REQUIRED NOTIFICATIONS taged class of persons. 3. Any special-purpose program in which a Regulation B requires four types of notifications for-profit organization participates to meet social to applicants for credit. The first three, which must needs, provided the program has a written plan 8This section is generally the same as in the Board's that identifies those it is designed to benefit and November proposal but is derived from the amended sets forth procedures and standards for helping act and therefore differs from existing Regulation B. them with credit, and provided the program makes The Board deleted from this section a part of the credit available to a class of persons who probably November proposal but is derived from the amended laws that did not permit inquiries permitted on model would not otherwise get it or would get it on less Federal Reserve forms, since such State laws may be favorable terms. more protective than the Federal law. Solicitation and consideration of information 9This section was adopted by the Board with little pertinent to establishing whether applicants share change from the November proposal; the chief excepa common characteristic required by a special- tion was that in some cases the general prohibition on purpose credit program are not unlawful discrim- inquiries about sex has been deleted. Also, business credit applicants may request an explanation of adverse ination. action and request that records of an adverse action be When financial need is a criterion for the exten- retained. sion of credit under a special-purpose program, 10 Incidental credit is credit extended for the conveninquiries otherwise not permissible concerning ience of the consumer on an informal basis by those who are not regularly in the business of being creditors, 7 This section has been considerably revised in detail and that does not involve a finance charge or more than from the November proposal, although it remains basi- four payments. Incidental credit may be extended cally the same. It is not a part of existing Regulation through the use of a credit card by other than the issuer B. of the card. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 93 be supplied together when adverse action occurs, NOTICE OF RIGHTS UNDER ECO A. The are notification of action taken, notification of Board has supplied in Regulation B a model notice rights under the Equal Credit Opportunity Act, and of rights of applicants for credit under the ECO A. either a statement of specific reasons for adverse It provided that a creditor complies by supplying action or a written statement of the right to such a notice that adheres substantially to the content reasons. The fourth, called "Credit History for of the Board's model notice, and that the creditor Married Persons" is notice to married couples of may include a reference in the notice to any similar their right to have credit information included in State statute or regulation. The model notice, credit reports in both names under certain condi- revised to take account of the 1976 amendments tions. to the Equal Credit Opportunity Act, is as follows: The Federal Equal Credit Opportunity Act NOTICE OF ACTION TAKEN. A creditor prohibits creditors from discriminating must notify an applicant of action taken on an against credit applicants on the basis of race, application either implicitly (for example, when color, religion, national origin, sex, marital an applicant gets a requested credit card or a loan) status, age (provided that the applicant has or explicitly— the capacity to enter into a binding contract); because all or part of the applicant's income Within 30 days: (1) after receiving a completed derives from any public assistance program; application; (2) after taking adverse action before or because the applicant has in good faith an application is completed; (3) after taking ad- exercised any right under the Consumer verse action in connection with an existing ac- Credit Protection Act. The Federal agency that administers compliance with this law count. concerning this creditor is (name and address Within 90 days: after an applicant has been as specified by the appropriate agency listed notified by the creditor of an offer of credit sub- in Appendix A of Regulation B, p. 48 of stantially different from the request made by the this BULLETIN). applicant, and the applicant has not expressly accepted or used the credit offered. CREDIT HISTORY FOR MARRIED PER- A notice to an applicant that adverse action has SONS. For accounts established on or after June been taken must be in writing and it shall contain 1, 1977, a creditor who furnishes credit informaa statement of the action taken, a notice of rights tion to other creditors shall: under ECO A, the name and address of the Federal 1. Determine whether both spouses can use an agency responsible for compliance, and a state- account or are contractually liable. ment of specific reasons for adverse action, or 2. Designate any such account in a way to disclosure of the applicant's right to have such a reflect the participation of both spouses. statement. This notification must be made within 3. Furnish information so as to enable the 30 days after the creditor receives a request for agency to provide access to the information about a statement. The applicant must file a request the account in the names of both spouses. within 60 days after notice of the action taken. 4. Where credit information is furnished in response to an inquiry regarding a particular appli- STATEMENT OF SPECIFIC REASONS. The cant, furnish it only about the spouse concerned regulation specifies that a statement of reasons for in the inquiry. adverse action must be specific—a general state- For accounts established before June 1, 1977, ment such as that the applicant did not score high a creditor furnishing credit information to another enough on a credit-scoring system does not suffice. creditor shall either: A creditor may use a statement or checklist of 1. Not later than June 1, 1977, determine if his own devising of reasons for adverse action, it is an account usable by both spouses or on which or he may use all or part of a sample form supplied both are contractually liable, and if so, designate by the Board in the regulation (in Sec. it in a manner to reflect the participation of both 202.9(b)(2)). Use of the sample form, when prop- spouses, and comply with the reporting requireerly completed, will satisfy the requirements of ments above. the regulation. A statement of reasons for adverse 2. Before October 1, 1977, mail or deliver to action may be given orally but, if so, the creditor all applicants in whose name an account is carried shall notify the applicant of the applicant's right on the creditor's records one copy of the notice to receive a statement of reasons in writing. "Credit History for Married Persons." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-94 Federal Reserve Bulletin • January 1977 For open-end accounts (such as credit-card ac- The Board provided that the signature of either counts) this requirement may be satisfied by mail- spouse is sufficient to avoid permitting one spouse ing one notice at any time before October 2, 1977, to exercise a veto over access to the credit history to all accounts for which any billing statement is of the account. sent between June 1 and October 1, 1977. For Provisions regarding information that may be closed-end accounts a creditor may delete from or may not be requested or obtained on applicathe "Credit History for Married Persons" refer- tions, rules regarding evaluation of applications, ences to who may use the account. and specific rules on extensions of credit are sub- The text of the notice to married persons fol- stantially similar to those in the existing Regulalows: tion B. CREDIT HISTORY The Board intends to publish in the near future FOR MARRIED PERSONS sample model application forms to aid in compliance. The Federal Equal Credit Opportunity Act prohibits credit discrimination on the basis of race, color, religion, national origin, sex, RECORD RETENTION marital status, age (provided that a person has the capacity to enter into a binding A creditor may retain any information prohibited contract); because all or part of a person's by the act or regulation when such information income derives from any public assistance was obtained from any source before March 23, program; or because a person in good faith has exercised any right under the Federal 1977, or at any time from credit-reporting agencies Consumer Credit Protection Act. Regula- or from the applicant or others without specific tions under the Act give married persons the request by the creditor or to monitor compliance right to have credit information included in with the act. credit reports in the name of both the wife Creditors shall retain for 25 months after notiand the husband if both use or are responsible for the account. This right was created, fying an applicant of action taken in connection in part, to insure that credit histories will with an application: be available to women who become divorced or widowed. —any application form received,* other in- If your account with us is one that both formation concerning the applicant's husband and wife signed for or is an account characteristics or for enforcement purthat is being used by one of you who did poses and copies of notification of action not sign, then you are entitled to have us taken, statement of specific reasons for report credit information relating to the ac- adverse action, and any written statement count in both your names. If you choose to by the applicant alleging violation of the have credit information concerning your ac- Act or Regulation B. count with us reported in both your names, please fill in and sign the statement below When a creditor has notification that it is under and return it to us. investigation or is subject to an enforcement pro- Federal regulations provide that signing ceeding for an alleged violation of the act or your name below will not change or increase Regulation B, the information cited above shall your or your spouse's legal liability on the be retained until final disposition of the matter. account. Your signature will only request that credit information be reported in both your names. PENALTIES If you do not complete and return the form below, we will continue to report your credit Creditors other than governmental entities who fail history in the same way that we do now. to comply with the act or Regulation B are subject to civil liability for actual and punitive damages When you furnish credit information on in individual or class actions. Liability for punitive this account, please report all information damages is limited to $10,000 in individual actions concerning it in both our names. and to the lesser of $500,000 or 1 per cent of the creditor's net worth in class actions. Account number Print or type name Infractions resulting from inadvertent error—a Print or type name mechanical, electronic, or clerical error that a creditor demonstrates was not intentional and oc- Signature of either spouse curred despite procedures reasonably adapted to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 95 avoid such error—are not violations of Regulation sary to provide management or operating expertise B or of the act. to minority or women's banks. 2. There may be no more than three interlocks between any two such banks, and the interlocks REGULATION F: Amendment may not represent a majority of the board of the bank being assisted. The Board of Governors on January 4, 1977, 3. No interlock may continue for more than 5 announced the revision of its Regulation F, which years. governs disclosures to shareholders by member The new rule, substantially the same as a change State banks with more than 500 shareholders. in Regulation L proposed in October, is effective There are currently 61 such banks subject to the immediately. regulation. The revision affects a guideline form and accompanying instructions that set forth the form and REGULATION T: content of financial statements to be filed with the Board of Governors. Suspension of Provision The changes conform to a recent amendment The Board of Governors on December 29, 1976, of the format of financial statements that all memsuspended until further notice—for options speber State banks must publish and file with the cialists—a provision of Regulation T (Credit by Board for supervisory purposes (the call report). Brokers and Dealers) that provides a uniform margin for the writing of options. REGULATION L: Amendment The uniform margin rule went into effect for others, as scheduled, on January 1, 1977. The Board of Governors on January 5, 1977, On December 15 the Board had published for announced an easing of its rules to permit inter- comment—to be received by January 17, 1977—a locking relationships, under specified conditions, proposed amendment to Regulation T that, among between a member bank and a minority or a other things, would allow an option specialist to women's bank. use an alternative method of calculating the re- The purpose of the amendment to the Board's quired margin from that provided in the uniform Regulation L is to assist the development of mi- rules to be effective January 1. Since the Board nority or women's banks by making it easier for would not be able to conclude action on its prothem to obtain needed management or operating posed alternative method of calculation by January expertise on their boards of directors. 1, it suspended the effective date of the uniform Interlocking relationships between member rules, as they apply to options specialists, pending banks and other banks in the same city, town, or further announcement. village are generally prohibited by Regulation L, under the Clayton Antitrust Law. However, the law allows the Board, by regulation, to permit PROPOSED INTERPRETATION exceptions. AND AMENDMENTS The Board has previously permitted banks in low-income areas to place on their boards a direc- The Board of Governors on December 23, 1976, tor, officer, or employee of a member bank in the published for public comment proposed sample same city, town, or village. Board approval is forms and instructions that could be used by lesrequired in each case. sors to comply with the Board's regulations im- The amendment to Regulation L extends the plementing the Consumer Leasing Act of 1976 exception to such interlocks between a member (Regulation Z). The Board requested comment bank and banks controlled or managed by mem- through January 21, 1977. bers of a minority group or women. In addition, the Board of Governors on De- The Board established the following conditions cember 28, 1976, issued for public comment a for interlocks between a member bank and nearby proposed amendment to Regulation Z (Truth in minority or women's banks: Lending) to clarify provisions that permit dis- 1. The interlocking relationship must be deter- counts for cash customers. Comment should be mined by the Federal Reserve Board to be neces- received by February 4, 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-96 Federal Reserve Bulletin • January 1977 The Board on December 30, 1976, issued for policy to achieve an orderly reduction in the comment a proposal to amend Regulation Z (Truth reserve currency role of sterling. To support these aims, agreement in principle has been in Lending) to require disclosure of a dealer parreached by governors of the central banks ticipation in a consumer credit contract. Comment concerned, on a medium-term financing fashould be received by the Board by February 4, cility in the amount of $3 billion related to 1977. the official sterling balances, which at the end of September were valued at $3.8 billion. This standby facility will be provided to the Bank of England by the BIS, backed PARTICIPATION IN up by the participating countries. The Man- STANDBY FACILITY aging Director of the International Monetary Fund is being requested to assist in the implementation of the agreement. The Treasury Department and the Federal Reserve The participating countries are Belgium, on January 10, 1977, announced that the United Canada, Germany, Japan, the Netherlands, States would participate in the arrangements Sweden, Switzerland, and the United States agreed upon in principle at Basle for a medium- of America. Other countries may wish to participate later. term facility in the amount of $3 billion relating As part of the operation the United Kingto official sterling balances. The U.S. participation dom intends to offer securities in the form in this standby facility will be in the amount of of foreign currency bonds to present official $1 billion. It will be provided through the Federal sterling holders. Reserve System and the U.S. Treasury Exchange Stabilization Fund. The purpose of these arrangements is to reinforce the international monetary system by helping BANK AND BRANCH DIRECTORS the United Kingdom to achieve an orderly reduc- The Board of Governors announced on January tion in the reserve currency role of sterling and 10, 1977, that 50 new directors would serve on in this connection to facilitate the funding of a boards of directors of the Federal Reserve Banks portion of Britain's external liabilities. The Bank and branches this year. Of these, 11-are women. for International Settlements will cooperate in the Over all, the boards of directors of the Reserve arrangements and the Managing Director of the Banks and their branches will include 17 women International Monetary Fund is being asked to and 16 members of minority groups this year. Of assist in their implementation. These sterling balthe women directors, 4 will serve on head office ance arrangements will reinforce the economic boards and 13 on branch boards. Minorities repreprogram undertaken by the United Kingdom in sented include six blacks, seven Hispanics, two connection with the $3.9 billion standby agree- American Indians, and one Oriental. Three of the ment with the IMF on January 3, 1977. blacks will serve on head office boards. The press announcement made by the central During 1976 there were seven women directors bank group in Basle is as follows: in the System, all at branch offices. In addition, Discussions have recently been taking last year's directors included five blacks—two at place between the United Kingdom and the head offices, five Hispanics, two American Indiother Group of Ten countries and Switzer- ans, and one Oriental. One of the new women land on the subject of sterling balances. directors at a head office this year formerly chaired These discussions follow the successful conclusion of the United Kingdom's appli- the branch board at San Antonio. cation to the International Monetary Fund There are 269 directors in the Federal Reserve and were prompted by a shared determi- System, 108 of them at the 12 Federal Reserve nation to make a joint contribution to greater Banks and 161 at the 25 branches. international monetary stability. Each of the 12 Federal Reserve Banks has a Fluctuations in the official sterling balances have at times in the past been disrup- board of directors of 9 members. Three members tive to the United Kingdom's economic pol- represent member banks and are bankers (Class icies and to the international monetary sys- A); three other members represent business, intem. The aim in the discussions has therefore dustry, and commerce in the district (Class B); been to prevent such instability in the future. and three members are appointed by the Board In these circumstances, there was general welcome to the United Kingdom's declared of Governors in Washington to represent the public Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 97 (Class C). Class A and Class B directors are The revisions are part of a broad effort by the elected to their posts by the member banks in the Board to refine reports from bank holding compa- Federal Reserve district. nies to increase the effectiveness of Federal Re- Of the four women directors at head offices, serve supervision of bank holding companies and three are Class C directors (at Philadelphia, Dallas, at the same time to reduce their reporting burdens. and San Francisco) and one is a Class B director Under the Bank Holding Company Act the Federal (at St. Louis). Reserve is responsible for supervision of bank Branch boards consist of either five or seven holding companies. A bank holding company is members. Appointments to those boards are made a company controlling one or more banks. by the boards of directors of the individual Reserve The bank holding company annual report re- Banks and by the Board of Governors in Wash- quires filing of detailed information annually soon ington. after the year-end on the ownership, structure, activities, and financial condition of bank holding companies. This report also collects information the Federal Reserve needs for analysis of bank RESERVE BANK EARNINGS holding companies, individually or in aggregates. Preliminary figures indicate that gross current The revisions adopted by the Board, for use in earnings of the Federal Reserve Banks amounted reporting 1976 data, include: requirements for new to $6,623 million during 1976, a 5.8 per cent information and detail to strengthen use of the increase from a year earlier. Net expenses, in- report for supervisory purposes; elimination of cluding assessment for expenditures of the Board some items regarded as unnecessary; and consoliof Governors, totaled $649 million, leaving cur- dation and reorganization of the information colrent net earnings of $5,974 million. lected to ease the reporting burden. With a $7 million net addition to the profit and The financial supplement provides information loss account, net earnings before payments to the in a form that can be used by computers for quick U.S. Treasury were $5,981 million. Payments to monitoring of changes in the financial condition the Treasury as interest on Federal Reserve notes of bank holding companies, individually or in amounted to $5,870 million; statutory dividends aggregates. to member banks, $57 million; and additions to The changes in the supplement are designed to Reserve Bank surplus, $54 million. expedite the receipt of timely information on the Under the policy adopted by the Board of Gov- financial condition of consolidated bank holding ernors at the end of 1964, all net earnings after companies and parent organizations. The 1976 the statutory dividend to member banks and addi- supplement is required to be filed within 45 days tions to surplus to bring it to the level of paid-in after the close of the bank holding company's capital were paid to the U.S. Treasury as interest fiscal year, instead of 90 days as at present. on Federal Reserve notes. In 1975 all bank holding companies (about Compared with 1975, gross earnings were up 1,900) were required to file the supplement. For $365 million. The principal changes in earnings 1976 the requirement is limited to about 750 were as follows: U.S. Government securities, an medium and large bank holding companies, those increase of $407 million; loans, a decrease of $8 with assets of $50 million or more in total banking million; and acceptances, a decrease of $20 mil- assets. lion. CHANGES IN BOARD STAFF BANK HOLDING COMPANIES: Revised Reports The Board of Governors announced on January 3, 1977, a reorganization of functions within the The Board of Governors on December 27, 1976, Division of Consumer Affairs. approved revisions of the bank holding company Nathaniel E. Butler, Chief of the Equal Credit annual report (F.R. Y-6) and the bank holding Opportunity Section, and Jerauld C. Kluckman, company financial supplement (F.R. Y-6 Supple- Assistant Director, were named to fill two newly ment), effective with reporting of year-end 1976 created Associate Director positions in the Dividata. sion. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-98 Federal Reserve Bulletin • January 1977 Before joining the Board's staff in March 1976, Digest, which was announced in the BULLETIN Mr. Butler had served as acting administrator of for October 1976, covers the period 1971-75, and the Colorado Uniform Consumer Credit Code. He insofar as possible, it ties in with series published is a graduate of Colby College in Waterville, in Banking and Monetary Statistics, 1941-1970. Maine, and the University of Chicago Law School. Some of the series that are no longer published The Board of Governors has also announced the in the BULLETIN will still appear in the Digest temporary appointment of Ruth A. Reister, As- because they are believed to be of some historical sistant Vice President and Assistant Counsel at the interest. Federal Reserve Bank of Minneapolis, as Assistant Secretary of the Board for a 6-month period beginning February 1, 1977. REVISED OTC STOCK LIST On the staff of the Minneapolis Reserve Bank since 1970, Ms. Reister holds an A.B. and J.D. The Board of Governors published a revised list from the University of Michigan and a Business of over-the-counter (OTC) stocks that are subject Administration Certificate from Harvard- to its margin regulations, effective December 29, Radcliffe. She replaces Richard D. Abrahamson, 1976. who is returning to the Federal Reserve Bank of The revised list, which supersedes the revised Chicago. list of OTC margin stocks that was issued on May 24, 1976, incorporates the newly amended criteria for inclusion and continued inclusion of stocks on CHANGES IN BULLETIN TABLES the list. It is available on request from Publications Services, Division of Administrative Services, With this issue of the BULLETIN a major revision Board of Governors of the Federal Reserve Sysof the statistical section has been implemented. tem, Washington, D.C. 20551. In order to strengthen the form and content of that section, a number of tables have been dropped, several new series have been introduced, and most SYSTEM MEMBERSHIP: of the tables have been substantially redesigned. Admission of State Banks Fewer retrospective data are being shown for almost all series, and the new formats are such that The following banks were admitted to membership the tables can eventually be produced by auto- in the Federal Reserve System during the period mated processes. The new structure continues to November 16, 1977, through January 15, 1977: reflect the emphasis on financial developments that has always characterized the statistical section. Massachusetts The Board recognizes the importance of having Boston New England Securities readily available to the public adequate amounts Depository Trust Company of the back data for the many series on financial Ohio and economic developments. Because of the cut- Alexandria .. The Alexandria Bank Company backs in the amount of data being published regu- South Dakota larly in the BULLETIN, the Board inaugurated the Sioux Falls First Northwestern Trust Co. Annual Statistical Digest. The first issue of the of South Dakota Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

99 Industrial Production Released for publication January 17 Total output of materials is estimated to be unchanged in December, as increases in nondura- Industrial production increased by an estimated 0.7 ble and energy materials were offset by decreased per cent in December to 132.8 per cent of the output of basic metal materials, primarily steel. 1967 average. This increase followed a 1.2 per cent rise in the index for November. About onethird of the December advance was attributed to Seasonally adjusted, ratio scale, 1967=100 higher motor vehicle production. Additional increases were widespread among final products and materials other than metals. During 1976, industrial production increased 6.8 per cent, with most of the growth occurring in the first half of the year. Output of durable consumer goods advanced 4.5 per cent during the month, reflecting a 14 per cent jump in auto and utility vehicle production after allowance for seasonal adjustment. Auto assemblies during December were at a seasonally adjusted annual rate of 10.0 million units, as companies sought to replenish and build stocks—particularly of the faster-selling intermediate- and full-size models. Production of home goods, such as appliances and carpeting and furniture, increased about 0.6 per cent, while the December output of nondurable consumer goods increased 0.4 per cent. Business equipment output is estimated to have increased an additional 1.0 per cent, following a sharp rise in November that stemmed F.R. indexes, seasonally adjusted. Latest figures: December. in part from a strike settlement. *Auto sales and stocks include imports. Seasonally adjusted, 1967 : = 100 PPeerr cceenntt cchhaannggeess ffrroomm—— IIInnnddduuussstttrrriiiaaalll ppprrroooddduuuccctttiiiooonnn 1976 Month Year Q3 to Sept. Oct. Nov.p Dec.e ago ago Q4 Total 130.8 130.4 131.9 132.8 .7 6.8 .6 Products, total 129.7 129.7 131.6 133.1 1.1 6.6 1.2 Final products 127.4 127.3 129.5 131.2 1.3 6.2 1.2 Consumer goods 136.2 136.9 138.7 141.1 1.7 6.7 1.5 Durable goods 138.4 138.6 143.7 150.1 4.5 12.0 2.0 Nondurable goods 135.3 136.3 136.8 137.4 .4 4.5 1.3 Business equipment 137.5 136.0 139.5 140.9 1.0 7.1 1.0 Intermediate products 138.7 138.4 139.3 140.4 .8 8.1 1.0 Construction supplies 134.3 134.1 135.5 137.4 1.4 10.7 1.4 Materials 132.5 131.6 132.3 132.3 .0 7.3 -.4 p Preliminary. Estimated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial and Business Statistics CONTENTS DOMESTIC FINANCIAL STATISTICS WEEKLY REPORTING COMMERCIAL BANKS A3 Monetary aggregates and interest rates Assets and Liabilities of A4 Member bank reserves—Factors A20 All reporting banks supplying and factors absorbing A21 Banks in New York City A5 Reserves and borrowings of member A22 Banks outside New York City banks A23 Balance sheet memoranda A6 Federal funds transactions of money A24 Commercial and industrial loans market banks A25 Gross demand deposits of individuals, POLICY INSTRUMENTS partnerships, and corporations A8 Federal Reserve Bank interest rates FINANCIAL MARKETS A9 Member bank reserve requirements A10 Maximum interest rates payable on A25 Commercial paper and bankers time and savings deposits at Federally acceptances outstanding insured institutions A26 Prime rate charged by banks on All Federal Reserve open market short-term business loans transactions A26 Interest rates charged by banks on business loans FEDERAL RESERVE BANKS A27 Interest rates in money and capital markets A12 Condition and F.R. note statements A28 Stock market—Selected statistics A13 Maturity distribution of loan and security holdings A29 Savings institutions—Selected assets and liabilities MONETARY AND CREDIT AGGREGATES A13 Demand deposit accounts—Debits FEDERAL FINANCE and rate of turnover A30 Federal fiscal and financing operations A14 Money stock measures and A31 U.S. Budget receipts and outlays components A3 2 Federal debt subject to statutory A15 Aggregate reserves and deposits of limitation member banks A32 Gross public debt of U.S. A15 Loans and investments of all Treasury—Types and ownership commercial banks A33 U.S. Government marketable securities—Ownership, by maturity COMMERCIAL BANK ASSETS AND A34 U.S. Government securities LIABILITIES dealers—Transactions, positions, and A16 Last-Wednesday-of-month series financing All Call-date series A3 5 Federal and Federally sponsored A18 Detailed balance sheet, March 31, 1976 credit agencies—Debt outstanding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-2 Federal Reserve Bulletin • January 1977 SECURITIES MARKETS AND CORPORATE INTERNATIONAL STATISTICS FINANCE A54 U.S. international transactions—Summary A36 New security issues—State and local A55 U.S. foreign trade government and corporate A55 U.S. reserve assets A37 Corporate securities—Net change in A56 Selected U.S. liabilities to foreigners amounts outstanding A37 Open-end investment companies—Net REPORTED BY BANKS IN THE UNITED sales and asset position STATES: A38 Corporate profits, taxes, and A57 Short-term liabilities to foreigners dividends A59 Long-term liabilities to foreigners A38 Nonfinancial corporations—Assets and A60 Short-term claims on foreigners liabilities A61 Long-term claims on foreigners A39 Business expenditures on new plant and equipment A62 Foreign branches of U.S. banks—Balance sheet data REAL ESTATE A40 Mortgage markets SECURITIES HOLDINGS AND TRANSACTIONS A41 Mortgage debt outstanding A64 Marketable U.S. Treasury bonds and notes—Foreign holdings and CONSUMER INSTALMENT CREDIT transactions A42 Total outstanding and net change A64 Foreign official accounts A43 Extensions and liquidations A65 Foreign transactions in securities FLOW OF FUNDS REPORTED BY NONBANKING CONCERNS IN THE UNITED STATES: A44 Funds raised in U.S. credit markets A45 Direct and indirect sources of funds A66 Short-term liabilities to and claims on to credit markets foreigners A67 Long-term liabilities to and claims on DOMESTIC NONFINANCIAL foreigners STATISTICS INTEREST AND EXCHANGE RATES A46 Nonfinancial business activity—Selected measures A68 Discount rates of foreign central banks A47 Output, capacity, and capacity A68 Foreign short-term interest rates utilization A68 Foreign exchange rates A47 Labor force, employment, and unemployment A48 Industrial production A79 Guide to Tabular Presentation and A50 Housing and construction Statistical Releases: Reference A51 Consumer and wholesale prices A52 Gross national product and income A53 Personal income and saving Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Statistics A3 1.10 MONETARY AGGREGATES AND INTEREST RATES 1976 1976 Item Q 1 Q2 Q3 Q4 Sept. Oct. Nov. Dec. Monetary and credit aggregates, (Annual rates of change, seasonally adjusted in per cent)12 Member bank reserves: 1 Total Reserves -6.3 3.9 0.2 8.2 -5.8 4.5 13.6 6.3 2 Required Reserves -5.8 4.0 0.4 7.0 -5.6 3.8 12.3 4.9 3 Nonborro wed -5.4 3.0 1.0 8.3 -4.4 3.3 14.4 7.0 Concepts of money:1 4 M-\ 2.7 8.4 4.1 6.0 -0.4 13.7 8.1 5 M-2 9.7 10.8 9.2 12.1 9.5 15.7 10.3 12.3 6 M-3 11.2 12.0 11.6 14.0 13.2 16.5 11.6 12.7 Time and savings deposits: Commercial banks: 7 Total 7.2 5.3 7.1 12.1 9.7 14.0 15.6 18.1 8 Other than large CD's 15.3 12.5 13.2 16.7 16.9 17.3 17.9 15.3 9 Thrift institutions2 13.7 14.0 15.4 16.7 18.8 17.1 13.7 13.0 10 Total loans and investments at commercial banks3 3.8 5.4 5.9 8.7 5.9 12.2 9.4 1.9 Interest rates (levels, per cent per annum) Short-term rates: 11 Federal funds 4 4.83 5.19 5.28 4.88 5.25 5.03 4.95 4.65 12 Treasury bills (3-month market yield) 4.92 5.16 5.15 4.67 5.08 4.92 4.75 4.35 13 Commercial paper (90- to 119-day) 6. 5.18 5.45 5.41 4.91 5.33 5.10 4.98 4.66 14 Federal Reserve discount7 5.59 5.50 5.50 5.39 5.50 5.50 5.43 5.25 Long-term rates: Bonds: 15 U.S. Government8 8.00 8.01 7.90 7.55 7.78 7.70 7.64 7.31 16 Aaa utility (new issue)9. 8.65 8.67 8.48 8.12 8.29 8.25 8.17 7.94 17 State and local government10 6.98 6.78 6.64 6.51 6.30 6.29 18 Conventional mortgages11 99..0000 88..9988 99..0033 99..0000 99..0000 88..9955 1 M-1 equals currency plus private demand deposits adjusted. 6 Most representative offering rate quoted by five dealers. M-2 equals M-1 plus bank time and savings deposits adjusted other 7 Rate for the Federal Reserve Bank of New York. than large CD's. 8 Market yields adjusted to a 20-year maturity by the U.S. Treasury. M-3 equals M-2 plus deposits at mutual savings banks and savings 9 Weighted averages of new publicly offered bonds rated Aaa, Aa, and and loan associations and credit union shares. A by Moody's Investors Service and adjusted to an Aaa basis. Federal 2 Savings and loan associations, mutual savings banks, and credit Reserve compilations. unions. I o Bond Buyer series for 20 issues of mixed quality. 3 Quarterly changes calculated from figures shown in Table 1.23 for II Average rates on new commitments for conventional first mortgages last month of current and preceding quarters. on new homes in primary markets, unweighted and rounded to nearest 4 Seven-day averages of daily effective rates (average of the rates on 5 basis points, from Dept. of Housing and Urban Development. a given date weighted by the volume of transactions at those rates). 12 Unless otherwise noted, rates of change are calculated from average 5 Quoted on a bank-discount rate basis. amounts outstanding in preceding month or quarter. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A4 Domestic Nonfinancial Statistics • January 1977 1.11 MEMBER BANK RESERVES Factors Supplying and Factors Absorbing Millions of dollars Monthly averages of daily figures End-of-month figures Factor 1976 1976 June July Aug. Sept. Oct. Nov. Dec.f Oct. Nov. Dec.? SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding. . 103,106 104,799 105,393 105,880 107,270 106,522 107,757 108,839 104,741 110,793 2 U.S. Government securities,1 88,704 90,256 91,583 91,966 93,535 92,659 93,412 95,839 91,660 97,021 3 Bought outright 87,477 89,405 89,259 89,926 91,886 91,527 91,031 93,278 91,660 93,268 4 Held under repurchase agreement 11,,222277 851 2,324 2,040 11,,664499 11,,113322 2,381 22,,556611 33,,775533 5 Federal agency securities, 66,,888888 6,849 6,875 6,831 66,,883399 66,,884488 6,916 66,,883366 6,857 77,,007722 6 Bought outright 66,,881122 6,805 6,799 6,763 66,,775577 66,,880044 6,805 66,,775577 6,857 66,,779944 7 Held under repurchase agreement 76 44 76 68 82 44 111 79 278 8 Acceptances 647 475 580 447 323 326 457 337 188 991 9 Loans 120 123 104 75 66 84 62 44 40 26 10 Float 2,678 2,721 2,512 2,880 2,763 3,094 3,656 2,013 2,635 2,501 11 Other Federal Reserve assets. . . 4,069 4,375 3,739 3,681 3,744 3,511 3,254 3,770 3,361 3,182 12 Gold stock 11,598 11,598 11,598 11,598 11,598 11,598 11,598 11,598 11,598 11,598 13 Special Drawing Rights certificate account 530 700 700 703 1,123 1,200 1,200 1,200 1,200 1,200 14 Treasury currency outstanding 10,623 10,648 10,690 10,737 10,778 10,826 10,867 10,729 10,779 10,884 ABSORBING RESERVE FUNDS 15 Currency in circulation 88,547 89,423 89,548 89,863 90,312 91,988 93,734 90,285 93,003 93,790 16 Treasury cash holdings 510 467 454 442 482 458 466 453 469 460 Deposits, other than member bank reserves with F.R. Banks: 17 Treasury 6,778 7,404 7,797 8,270 9,199 6,709 6,138 10,238 6,766 10,393 18 Foreign 252 262 275 249 266 259 306 362 305 352 19 Other 784 945 979 1,071 1,012 947 974 953 1,022 1,357 20 Other F.R. liabilities and capital... 3,275 3,310 3,326 3,315 3,372 3,326 3,253 3,615 3,514 3,063 21 Member bank reserves with F.R. Banks 25,711 25,933 26,001 25,708 26,127 26,458 26,550 26,461 23,239 25,059 Weekly averages of daily figures for weeks ending— Wednesday figures 1976 1976 Dec. 1 Dec. 8 Dec. 15 Dec. 22p Dec. 29p Dec. 1 Dec. 8 Dec. 15 Dec. 22p Dec. 29*> SUPPLYING RESERVE FUNDS 22 Reserve Bank credit outstanding. ., 107,590 103,527 104,725 108,600 112,778 104,645 105,591 109,415 113,796 115,810 23 U.S. Government securities, total1, 93,225 89,543 91,544 94,495 97,278 89,535 91,612 94,313 98,162 100,959 24 Bought outright 91,593 89,543 90,761 91,811 91,791 89,535 91,612 91,379 91,687 91,505 25 Held under repurchase agreement 11,,663322 783 22,,668844 5,487 22,,993344 66,,447755 99,,445544 26 Federal agency securities, total 66,,991155 6,833 6,825 66,,888833 7,076 6,833 6,833 66,,889944 77,,001122 77,,220033 27 Bought outright 66,,885566 6,833 6,800 66,,1199 AA 6,794 6,833 6,833 66,,779944 66,,1199 AA 66,,779944 28 Held under repurchase agreement 59 25 89 282 100 218 409 29 Acceptances 401 195 258 440 810 197 189 544 708 1,017 30 Loans 87 26 69 37 82 349 24 329 75 375 31 Float 3,556 3,530 2,826 3,586 4,340 4,093 3,610 4,175 4,721 3,014 32 Other Federal Reserve assets 3,407 3,400 3,203 3,158 3,191 3,638 3,323 3,160 3,118 3,242 33 Gold stock 11,598 11,598 11,598 11,598 11,598 11,598 11,598 11,598 11,598 11,598 34 Special Drawing Rights certificate account 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 35 Treasury currency outstanding. .. . 10,843 10,848 10,862 10,874 10,881 10,843 10,848 10,864 10,879 10,884 ABSORBING RESERVE FUNDS 36 Currency in circulation 92,781 93,019 93,660 93,953 94,282 93,075 93,641 94,092 94,519 94,545 37 Treasury cash holdings 463 477 465 475 475 479 464 447 475 475 Deposits, other than member bank reserves with F.R. Banks: 38 Treasury 6,531 3,708 3,442 6,478 9,781 6,189 3,011 3,328 8,632 9,684 39 Foreign 280 258 271 305 385 312 292 335 287 257 40 Other 1,133 982 1,046 916 882 1,176 970 885 840 932 41 Other F.R. liabilities and capital. . 3,470 3,069 3,134 3,263 3,492 3,488 3,025 3,219 3,367 3,567 42 Member bank reserves with F.R. Banks 26,573 25,660 26,365 26,881 27,159 23,567 27,834 30,770 29,352 30,031 1 Includes securities loaned—fully guaranteed by U.S. Govt, securities NOTE.—For amounts of currency and coin held as reserves, see Table pledged with F.R. Banks—and excludes (if any) securities sold and sched- 1.12. uled to be bought back under matched sale-purchase transactions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Member Banks A5 1.12 RESERVES AND BORROWINGS of Member Banks Millions of dollars Monthly averages of daily figures Reserve classification 1975 1976 Dec. Apr. May June July Aug. Sept. Oct. Nov. Dec.p All member banks: Reserves: At F.R. Banks 27,215 26,345 26,236 25,711 25,933 26,001 25,708 26,127 26,458 26,550 Currency and coin 7,773 7,568 7,838 7,903 8,064 7,989 8,113 8,025 8,180 8,550 Total heldi 34,989 34,063 34,228 33,774 34,146 34,141 33,979 34,305 34,797 35,258 Required 34,727 33,974 33,846 33,657 34,076 33,844 33,692 34,116 34,433 34,967 Excess1 262 89 382 117 70 297 287 189 364 291 Borrowings at F.R. Banks:2 Total 127 44 121 120 123 104 75 66 84 62 Seasonal 13 11 11 20 24 28 31 32 21 13 Large banks in New York City: 8 Reserves held 6,812 6,670 6,672 6,546 6,507 6,559 6,372 6,374 6,589 6,465 9 Required 6,748 6,668 6,659 6,524 6,548 6,501 6,308 6,346 6,485 6,602 10 Excess 64 2 13 22 -41 58 64 28 104 -137 11 Borrowings2 63 29 26 37 28 22 36 15 Large banks in Chicago: 12 Reserves held 1,740 1,702 1,578 1,767 1,672 1,684 1,615 1,648 1,621 1,619 13 Required 1,758 1,706 1,647 1,676 1,690 1,625 1,617 1,635 1,602 1,641 14 Excess -18 -4 -69 91 -18 59 -2 13 19 -22 15 Borrowings 2 8 2 7 13 6 3 3 4 Other large banks: 16 Reserves held.... 13,249 12,597 12,829 12,318 12,633 12,610 12,584 12,704 12,889 12,839 17 Required 13,160 12,644 12,532 12,443 12,660 12,549 12,521 12,706 12,802 13,052 18 Excess 89 -47 297 -125 -27 61 63 -2 87 -213 19 Borrowings2 26 15 33 22 11 20 3 17 7 14 All other banks: 20 Reserves held. 13,188 13,094 13,149 13,143 13,334 13,288 13,408 13,579 13,698 13,844 21 Required..., 13,061 12,956 13,008 13,014 13,178 13,169 13,246 13,429 13,544 13,672 22 Excess 127 138 141 129 156 119 162 150 154 172 23 Borrowings2.. 38 21 57 65 62 50 47 46 41 29 Weekly averages of daily figures for weeks ending— 1976 Oct. 27 Nov. 3 Nov. 10 Nov. 17 Nov. 24 Dec. 1 Dec. 8 Dec. 15 Dec. 22v Dec. 29f All member banks Reserves: 24 At F.R. Banks 26,184 26,343 25,417 26,777 26,596 26,573 25,660 26,365 26,881 27,159 25 Currency and coin 7,844 8,277 8,452 8,235 7,637 8,381 8,494 8,931 8,151 8,624 26 Total held1 34,184 34,778 34,027 35,171 34,392 35,113 34,313 35,456 35,190 35,941 27 Required 34,073 34,317 34,005 34,818 34,272 34,729 34,188 34,989 35,086 35,494 28 Excess1 111 461 22 353 120 384 125 467 104 447 Borrowings at F.R. Banks:2 29 Total 119 202 50 54 44 87 26 69 37 82 30 Seasonal 33 29 23 21 21 18 14 13 11 11 Large banks in New York City 31 Reserves held 6,122 6,472 6,338 6,875 6,316 6,541 6,467 6,775 6,682 6,563 32 Required 6,134 6,362 6,349 6,803 6,320 6,526 6,406 6,763 6,570 6,628 33 Excess -12 110 -11 72 -4 15 61 12 112 -65 3344 Borrowings2 112288 1144 1144 4444 1166 6 Large banks in Chicago 35 Reserves held 1,654 1,626 1,584 1,655 1,551 1,669 1,556 1,689 1,647 1,619 36 Required 1,651 1,619 11,,557766 1,658 1,521 1,654 1,586 1,660 1,630 1,674 37 Excess 3 7 88 -3 30 15 -30 29 17 -55 3388 Borrowings 2 1133 1188 Other large banks 39 Reserves held 12,703 12,936 12,649 12,967 12,746 13,020 12,588 13,245 13,096 12,985 40 Required 12,693 12,805 12,726 12,895 12,735 12,857 12,655 13,008 13,158 13,339 41 Excess 10 131 -77 72 11 163 -67 237 -62 -354 4422 Borrowings2 6600 1177 33 6 55 9 10 45 All other banks 43 Reserves held 13,705 13,744 13,456 13,674 13,779 13,883 13,702 13,747 13,815 14,012 44 Required 13,595 13,531 13,354 13,462 13,696 13,692 13,541 13,558 13,728 13,853 45 Excess 110 213 102 212 83 191 161 189 87 159 46 Borrowings2 46 57 36 37 38 38 26 26 27 31 1 Adjusted to include waivers of penalties for reserve deficiencies in nonmember bank joins the Federal Reserve System. For weeks for which accordance with Board policy, effective Nov. 19, 1975, of permitting figures are preliminary, figures by class of bank do not add to total transitional relief on a graduated basis over a 24-month period when a because adjusted data by class are not available. nonmember bank merges into an existing member bank, or when a 2 Based on closing figures. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A6 DomesticN onfinancial Statistics • January 1977 1.13 FEDERAL FUNDS TRANSACTIONS of Money Market Banks Millions of dollars, except as noted 1976, week ending— TTyyppee Nov. 3 Nov. 10 Nov. 17 Nov. 24 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Dec. 29 Total, 46 banks Basic reserve position: 1 Excess reserves1 194 28 163 114 34 46 237 71 3311 LESS: 2 Borrowings at F R Banks. ... 113322 1144 1177 4444 4411 4 1155 3 Net interbank Federal funds transactions 16,086 20,680 19,191 17,257 15,990 19,282 20,453 19,521 16,472 EQUALS : Net surplus, or deficit (-): 4 Amount --1166,,002244 -20,666 -19,044 -17,143 -16,000 -19,236 -20,257 -19,454 -16,457 5 Per cent of average required reserves 107.8 139.9 123.8 117.0 105.5 130.3 131.2 127.5 110066..77 Interbank Federal funds transactions: Gross transactions: 6 Purchases 23,762 26,748 25,525 23,167 22,611 24,866 26,820 26,662 24,354 7 Sales 7,676 6,068 6,335 5,910 6,621 5,584 6,367 7,142 7,882 8 Two-way transactions2 5,085 4,224 4,841 4,494 4,795 4,517 4,686 4,942 5,191 Net transactions: 9 Purchases of net buying banks... 18,677 22,524 20,685 18,673 17,816 20,349 22,134 21,721 19,164 10 Sales of net selling banks 2,591 1,843 1,494 1,417 1,826 1,068 1,682 2,199 2,691 Related transactions with U.S. Government securities dealers: 11 Loans to dealers3 3,501 4,888 3,714 3,047 3,436 4,680 4,413 4,173 3,305 12 Borrowing from dealers4 1,292 917 1,155 1,490 1,552 1,496 1,359 2,034 2,574 13 Net loans 2,208 3,970 2,559 1,557 1,885 3,184 3,055 2,139 731 8 banks in New York City Basic reserve position: 14 Excess reserves1 106 -8 70 47 -57 57 30 34 4 LESS: 15 Borrowings at F R Banks. . 112288 1144 1144 4444 1166 16 Net interbank Federal funds transactions 5,708 8,009 7,115 5,526 5,045 6,930 7,922 7,760 6,410 EQUALS : Net surplus, or deficit (-): 17 Amount --55,,773300 --88,,003300 -7,059 --55,,447799 --55,,114466 -6,873 -7,908 -7,726 -6,407 18 Per cent of average required 98.6 138.2 113.2 94.9 85.0 117.3 127.5 128.9 110066..11 Interbank Federal funds transactions: Gross transactions: 19 Purchases 6,739 8,450 7,830 6,238 5,865 7,555 8,548 8,505 7,463 20 Sales 1,031 442 714 712 820 625 626 745 1,053 21 Two-way transactions2 1,031 442 715 712 820 625 626 745 841 Net transactions: 22 Purchases of net buying banks... 55,,770088 88,,000099 7,115 5,526 5,045 6,930 7,922 7,760 6,622 2233 Sales of net selling banks 221122 Related transactions with U.S. Government securities dealers: 24 2,278 2,440 2,115 1,834 1,966 2,407 2,542 2,573 1,813 25 Borrowing from dealers4 158 143 241 296 364 389 367 375 437 26 Net loans 2,120 2,297 1,874 1,538 1,602 2,018 2,175 2,198 1,377 38 banks outside New York City Basic reserve position: 27 Excess reserves1 88 35 93 67 91 -11 207 37 27 LESS: 28 Borrowings at F R Banks 4 3 2255 4 1155 29 Net interbank Federal funds transactions 10,378 12,671 12,075 11,731 10,945 12,352 12,531 11,761 10,062 EQUALS: Net surplus, or deficit (-): 30 Amount --1100,,229944 --1122,,663366 -11,985 -11,665 -10,854 -12,363 -12,349 -11,729 -10,050 31 Per cent of average required reserves 113.8 141.0 131.1 131.4 119.1 138.9 133.6 126.6 107.1 Interbank Federal funds transactions: Gross transactions: 32 Purchases 17,023 18,298 17,696 16,929 16,746 17,311 18,272 18,158 16,891 33 Sales 6,645 5,626 5,621 5,198 5,801 4,959 5,741 6,397 6,829 34 Two-way transactions2 4,055 3,783 4,126 3,782 3,975 3,892 4,060 4,197 4,350 Net transactions: 35 Purchases of net buying banks... 12,969 14,515 13,569 13,148 12,771 13,419 14,212 13,961 12,542 36 Sales of net selling banks 2,591 1,843 1,494 1,417 1,826 1,068 1,682 2,199 2,480 Related transactions with U.S. Government securities dealers: 37 Loans to dealers3 1,223 2,448 1,599 1,213 1,470 2,272 1,872 1,600 1,492 38 Borrowing from dealers4 1,134 774 915 1,194 1,188 1,107 992 1,659 2,138 39 Net loans 89 1,673 685 19 282 1,165 880 -60 -646 For notes see end of table. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Funds Al 1.13 Continued 1976, week ending— TTyyppee Nov. 3 Nov. 10 Nov. 17 Nov. 24 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Dec. 29 5 banks in City of Chicago Basic reserve position: 40 Excess reserves1 10 27 68 41 30 -20 25 42 9 LESS: 41 Borrowings at F.R. Banks 1188 42 Net interbank Federal funds transactions 6,170 6,950 66,,668811 6,131 55,,776644 55,,776655 6,140 66,,117766 5,483 EQUALS : Net surplus, or deficit (-): 43 Amount -6,159 --66,,992244 --66,,661144 -6,090 --55,,773355 --55,,778855 -6,133 --66,,113344 --55,,447744 44 Per cent of average required reserves 408.0 472.4 427.4 430.9 371.3 391.5 396.5 403.9 350.6 Interbank Federal funds transactions: Gross transactions: 45 Purchases 6,819 7,383 7,238 6,703 6,479 6,372 6,786 7,044 6,512 46 Sales 650 433 557 573 714 607 646 868 1,029 47 Two-way transactions2 650 433 557 573 714 607 646 856 11,,002299 Net transactions: 48 Purchases of net buying banks... 66,,117700 66,,995500 66,,668811 66,,113311 5,764 5,765 66,,114400 6,188 5,483 4499 Sales of net selling banks 1122 Related transactions with U.S. Government securities dealers: 50 Loans to dealers3 390 703 573 389 365 508 565 500 308 51 Borrowing from dealers4 316 127 392 396 390 395 387 299 515 52 Net loans 74 576 182 -7 -24 114 178 201 -207 33 other banks Basic reserve position: 53 Excess reserves1 78 9 26 26 61 9 182 -6 18 LESS: 54 Borrowings at F.R. Banks 4 33 7 4 1155 55 Net interbank Federal funds transactions 44,,220088 5,721 55,,339944 5,601 5,181 66,,558877 66,,339911 55,,558855 44,,557799 EQUALS: Net surplus, or deficit (-): 56 Amount -4,134 --55,,771122 -5,372 --55,,557755 --55,,112200 --66,,557788 --66,,221166 --55,,559955 --44,,557766 57 Per cent of average required reserves 54.8 76.2 70.7 74.7 67.7 88.6 80.8 72.2 58.5 Interbank Federal funds transactions: Gross transactions: 58 Purchases 10,204 10,915 10,458 10,226 10,268 10,939 11,486 11,114 10,380 59 Sales 5,996 5,194 5,064 4,625 5,087 4,353 5,095 5,529 5,801 60 Two-way transactions2 33,,440055 33,,335500 33,,557700 3,209 33,,226611 33,,228855 3,414 3,341 3,321 Net transactions: 61 Purchases of net buying banks... 6,799 7,565 6,888 7,017 7,007 7,654 8,072 7,773 7,058 62 Sales of net selling banks 2,591 1,843 1,494 1,417 1,826 1,068 1,682 2,188 2,480 Related transactions with U.S. Government securities dealers: 63 Loans to dealers3 833 1,745 1,026 824 1,105 1,764 1,307 1,100 1,183 64 Borrowing from dealers4 818 647 523 798 798 712 604 1,361 1,623 65 Net loans 15 1,098 503 26 307 1,052 703 -261 -439 1 Based on reserve balances, including adjustments to include waivers 4 Federal funds borrowed, net funds acquired from each dealer by of penalties for reserve deficiencies in accordance with changes in Board clearing banks, reverse repurchase agreements (sales of securities to policy effective Nov. 19, 1975. dealers subject to repurchase), resale agreements, and borrowings secured 2 Derived from averages for individual banks for entire week. Figure by U.S. Govt, or other securities. for each bank indicates extent to which the bank's average purchases and sales are offsetting. NOTE.—Weekly averages of daily figures. For description of series, 3 Federal funds loaned, net funds supplied to each dealer by clearing see Federal Reserve Bulletin for August 1964, pp. 944-53. Back data for banks, repurchase agreements (purchases from dealers subject to resale) 46 banks appear in the Board's Annual Statistical Digest, 1971-1975, or other lending arrangements. Table 3. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 Domestic Financial Statistics • January 1977 1.14 FEDERAL RESERVE BANK INTEREST RATES Per cent per annum Current and recent levels Loans to member banks— Loans to all others Under Sec. 10(b)2 under last par. Sec. 134 Federal Reserve Under Sees. 13 and 13a* Bank Regular rate Special rate3 Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous 12/31/76 date rate 12/31/76 date rate 12/31/76 date3 rate 12/31/76 date rate Boston 514 11/22/76 51/2 534 11/22/76 6 614 11/22/76 6V2 814 11/22/76 8*4 New York 51/4 11/22/76 51/2 534 11/22/76 6 61/4 11/22/76 61/2 814 11/22/76 81/i Philadelphia 514 11/22/76 5Vi 5*4 11/22/76 6 614 11/22/76 61/2 81/4 11/22/76 8V4 Cleveland 51/4 11/22/76 5Vt 5*4 11/22/76 6 614 11/22/76 6V2 81/4 11/22/76 81/4 Richmond 51/4 11/22116 5iA 5*4 11/22/76 6 614 11/22/76 61/2 814 11/22/76 8V4 Atlanta 51/4 11 /22/76 5!4 534 \\/22/16 6 614 11/22/76 61/2 814 11/22/76 8V4 Chicago 514 U122/16 5i/i 5V4 11 /22/16 6 614 11/22/76 61/2 814 11/22/76 81/4 St. Louis 514 11/26/76 5Vi 534 11/26/76 6 614 11/26/76 61/2 81/4 11/26/76 81/i Minneapolis 514 11/22/16 51A 534 11 /22/16 6 614 11/22/76 61/2 81/4 11/22/76 81/i Kansas City 514 11/22/76 5i/i 5*4 11/22/76 6 61/4 11/22/76 61/2 814 11/22/76 81/2 Dallas 51/4 U/22/16 5iA 53/4 11/22/76 6 61/4 11/22/65 61/2 81/4 11/22/76 81/2 San Francisco. .. 514 11/22/76 5i/i 534 11/22/16 6 61/4 11/22/76 6V2 814 11/22/76 81/4 Range of rates in recent years5 Range F.R. Range F.R. Range F.R. Effective date (or level)- Bank Effective date (or level)— Bank Effective date (or level)— Bank All F.R. of All F.R. of All F.R. of Banks N.Y. Banks N.Y. Banks N.Y. In effect Dec. 31, 1970 5V 2 51/2 1973—J F a e n b . . 2 1 6 5 . . 5 5 -5 Vi 5 51 /2 1975—Jan. 1 6 0 7 7 1 1 4 4 - - 7 7 3 3 4 4 7 7 3 1 4 4 1971—Jan. 8 51/4-51/2 51/4 Mar. 2. 51/2 5iA 24 714 714 15 51/4 5V4 Apr. 23. 51A-53/4 5i/i Feb. 5 634-714 634 19 5 -51/4 5V4 May 4. 53/4 534 7 634 63/4 22 5 -51/4 5 11. 53/4-6 6 Mar. 10 61/4-634 614 29 5 5 18. 6 6 14 6*4 61/4 Feb. 13 43/4-5 5 June 11. 6-61/2 61/2 May 16 6-614 6 July 1 1 9 6 43 4 4 y -45 4 5 V4 July 1 2 5 . . 6 7 V i 6 7 V 4 23 6 6 2 3 5 5 Aug. 14. 7-7 Vi 71/2 1976—Jan. 19 5V4-6 51/2 Nov. 11 4V4-5 5 23. 71/2 71/2 23 5I/4 51/2 Dec. 2 1 1 1 9 4 3 7 4 41 1 4 / 4 2 / V - 1 2 4 / 4- 3 2 4 4 3 /4 4 4 4 4 3 V 1 1 /4 / / 4 2 2 1974—A D p ec r . . 2 3 9 5 0 , . . 7 7 1 3 / / 8 2 4 - - 8 8 7 8 8 3 4 Nov. 2 2 2 6 514 51 -5 /4 V 4 5 51 1 / 4 4 16 73/4 73/4 In effect Dec. 31, 1976. 51/4 51/4 1 Discounts of eligible paper and advances secured by such paper or by 4 Advances to individuals, partnerships, or corporations other than U.S. Govt, obligations or any other obligations eligible for F.R. Bank member banks secured by direct obligations of, or obligations fully purchase. guaranteed as to principal and interest by, the U.S. Govt, or any agency 2 Advances secured to the satisfaction of the F.R. Bank. Advances thereof. secured by mortgages on 1- to 4-family residential property are made at 5 Rates under Sees. 13 and 13a (as described above). For description the Section 13 rate. and earlier data, see the following publications of the Board of Governors: 3 Applicable to special advances described in Section 201.2(e)(2) of Banking and Monetary Statistics, 1914-1941, Banking and Monetary Regulation A. Statistics, 1941-1970, and Annual Statistical Digest, 1971-75. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A9 1.15 MEMBER BANK RESERVE REQUIREMENTS Per cent of deposits Requirements in effect Previous requirements1 Dec. 31, 1976 TTyyppee ooff ddeeppoossiitt,, aanndd ddeeppoossiitt iinntteerrvvaall iinn mmiilllliioonnss ooff ddoollllaarrss Per cent Effective date Per cent Effective date Net demand:2 0-2 7 12/30/76 71/2 2/13/75 2-10 91/z 12/30/76 10 2/13/75 10-100 NY4 12/30/76 12 2/13/75 O 10 v 0 e - r 4 4 0 0 0 0 I N 6 Y V 4 4 1 1 2 2 / / 3 3 0 0 / / 7 7 6 6 1 I6 3 I /2 2 2 / / 1 1 3 3 / / 7 7 5 5 Time:2,3 Savings 3 3/16/67 3/2/67 Other time: 0-5, maturing in— 30-179 days 3 3/16/67 m 3/2/67 180 days to 4 years 42Vi 1/8/76 3 3/16/67 4 years or more 41 10/30/75 3 3/16/67 Over 5, maturing in— 30-179 days 6 12/12/74 5 10/1/70 180 days to 4 years 42 % 1/8/76 3 12/12/74 4 years or more 41 10/30/75 3 12/12/74 Legal limits, Dec. 31, 1976 Minimum Maximum Net demand: Reserve city banks 10 22 Other banks 7 14 Time 3 10 For changes beginning 1963, see Board's Annual Statistical Digest, (c) Member banks are required under the Board's Regulation M to 1971-1975 and for prior changes, see Board's Annual Report for 1975, maintain reserves against foreign branch deposits computed on the basis Table 13. of net balances due from domestic offices to their foreign branches and 2 (a) Requirement schedules are graduated, and each deposit interval against foreign branch loans to U.S. residents. Loans aggregating $100,000 applies to that part of the deposits of each bank. Demand deposits or less to any U.S. resident are excluded from computations, as are total subject to reserve requirements are gross demand deposits minus cash loans of a bank to U.S. residents if not exceeding $1 million. Regulation D items in process of collection and demand balances due from domestic imposes a similar reserve requirement on borrowings from foreign banks banks. by domestic offices of a member bank. A reserve of 4 per cent is required (b) The Federal Reserve Act specifies different ranges of requirements for each of these classifications. for reserve city banks and for other banks. Reserve cities are designated 3 Negotiable orders of withdrawal (NOW) accounts and time deposits under a criterion adopted effective Nov. 9, 1972, by which a bank having such as Christmas and vacation club accounts are subject to the same net demand deposits of more than $400 million is considered to have the requirements as savings deposits. character of business of a reserve city bank. The presence of the head 4 The average of reserves on savings and other time deposits must be office of such a bank constitutes designation of that place as a reserve at least 3 per cent, the minimum specified by law. city. Cities in which there are F.R. Banks or branches are also reserve cities. Any banks having net demand deposits of $400 million or less NOTE.—Required reserves must be held in the form of deposits with are considered to have the character of business of banks outside of F.R. Banks or vault cash. reserve cities and are permitted to maintain reserves at ratios set for banks not in reserve cities. For details, see the Board's Regulation D. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 Domestic Nonfinancial Statistics • January 1977 1.16 MAXIMUM INTEREST RATES PAYABLE on Time and Savings Deposits at Federally Insured Institutions Per cent per annum Commercial banks Savings and loan associations and mutual savings banks Type and maturity of deposit In effect Dec. 31, 1976 Previous maximum In effect Dec. 31, 1976 Previous maximum Per cent Effective Per cent Effective Per cent Effective Per cent Effective date date date date Savings 7/1/73 4% 1/21/70 51/4 (4) (5) Negotiable order of withdrawal (NOW) accounts1 1/1/74 5 1/1/74 Time (multiple- and single-maturity unless otherwise indicated):2 30-89 days: S M in u g lt le ip -m lea m tu a r t i u ty ri ty 7/1/73 4 5 * 4 9 1 / / 2 2 6 1 / / 6 7 6 0 (6) (6) 90 days to 1 year: S M in u g lt le ip -m le- a m tu a r t i u ty r ity 5Vi 7/1/73 9 7 / / 2 2 6 0 / / 6 6 6 6 (4) 51/4 1/21/70 2 i 1 y t 2 t o o t 2 o 2 l / 4 y i e y y a e e r a a s r r 3 s s 3 6 7 7 / / 1 1 / / 7 7 3 3 5 5 5 3 V % /4 4 1 1 1 / / / 2 2 2 1 1 1 / / / 7 7 7 0 0 0 6 % ( ( 4 4 ) ) 6 5 6 y 4 1 1 1 / / / 2 2 2 1 1 1 / / / 7 7 7 0 0 0 4 6 t y o e a 6 r s y e o a r r m s ore 7 m 1/ 4 1 1 2 1 /2 /1 3 / / 7 7 3 4 l (lA 7) 11/1/73 m m 12 1 / 1 2 / 3 1/ / 7 7 3 4 7 ( 1 7 / ) 2 11/1/73 Governmental units (all maturities).... m 12/23/74 m 11121/74 m 12/23/74 m 11/27/74 1 For authorized States only. Federally insured commercial banks, were limited to the 6Vi per cent ceiling on time deposits maturing in 2l/i savings and loan associations, cooperative banks, and mutual savings years or more. banks were first permitted to offer NOW accounts on Jan. 1, 1974. Effective Nov. 1, 1973, the present ceilings were imposed on certificates Authorization to issue NOW accounts was extended to similar institu- maturing in 4 years or more with minimum denominations of $1,000. tions throughout New England on Feb. 27, 1976. There is no limitation on the amount of these certificates that banks can 2 For exceptions with respect to certain foreign time deposits see the issue. In December 1975 the Federal regulatory agencies removed the Federal Reserve BULLETIN for October 1962 (p. 1279), August 1965 (p. minimum-denomination requirement on time deposits representing funds 1094), and February 1968 (p. 167). contributed to an individual retirement account (IRA) established pursuant 3 A minimum of $1,000 is required for savings and loan associations, to the Internal Revenue Code. Similar action was taken for Keogh (H.R. except in areas where mutual savings banks permit lower minimum de- 10) plans in November 1976. nominations. This restriction was removed for deposits maturing in less than 1 year effective Nov. 1, 1973. NOTE—Maximum rates that can be paid by Federally insured commer- 4 July 1, 1973, for mutual savings banks; July 6, 1973, for savings and cial banks, mutual savings banks, and savings and loan associations are loan associations. extablished by the Board of Governors of the Federal Reserve System, 5 Oct. 1, 1966, for mutual savings banks; Jan. 21, 1970, for savings and the Board of Directors of the Federal Deposit Insurance Corporation, loan associations. and the Federal Home Loan Bank Board under the provisions of 12 6 No separate account category. CFR 217, 329, and 526, respectively. The maximum rates on time de- 7 Between early July 1973 and Oct. 31, 1973, there was no ceiling for posits in denominations of $100,000 or more were suspended in midcertificates maturing in 4 years or more with minimum denominations 1973. For information regarding previous interest rate ceilings on all of $1,000; however, the amount of such certificates that an institution types of accounts, see earlier issues of the Federal Reserve BULLETIN, could issue was limited to 5 per cent of its total time and savings deposits. the Federal Home Loan Bank Board Journal, and the Annual Report Sales in excess of that amount, as well as certificates of less than $1,000, of the Federal Deposit Insurance Corporation. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments All 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS Millions of dollars 1976 TTyyppee ooff ttrraannssaaccttiioonn 11997733 11997744 11997755 May June July Aug. Sept. Oct. Nov. U.S. Govt, securities Outright transactions (excl. matched sale-purchase transactions): Treasury bills: 1 Gross purchases 11115555,,,,555511117777 11111111,,,,666666660000 11111111,,,,555566662222 111,,,333333555 2222,,,,777711119999 222777999 1,100 11,,112255 618 333344446666 4444,,,,888888880000 5555,,,,888833330000 5555,,,,555599999999 111,,,222222444 555522224444 111,,,444111333 117711 444488880000 3333,,,,444400005555 4444,,,,555555550000 22226666,,,,444433331111 444000333 333355550000 888777555 220000 666600000000 Others within 1 year:1 1111,,,,333399996666 444455550000 3333,,,,888888886666 88883333 4422 112299 11118888 6 Exchange, or maturity shift 111,,,000444777 ---111,,,111888333 ---444 2,602 -449 59 -1,525 -285 66 1,047 111,,,111888777 111333111 333,,,555444999 1 to 5 years: 555777999 777999777 222333,,,222888444 661177 330011 558800 111133 10 Exchange, or maturity shift --22,,002288 --669977 33,,885544 -3,105 444499 -59 --7799 228855 -66 443300 5 to 10 years: 1 1 RIRN«S MIR^LIAQPQ 550000 443344 11,,551100 119955 7722 227722 6622 888999555 111,,,666777555 ---444,,,666999777 441188 111,,,333555444 ---111,,,111666777 Over 10 years: 14 Gross purchases 111222999 111999666 111,,,000777000 9966 666555 9955 777333 8888877777 222220000055555 888884444488888 8888855555 225500 -----333331111100000 All maturities:1 17 Gross purchases 1111188888,,,,,111112222211111 1111133333,,,,,555553333377777 222222222211111,,,,,333331111133333 11111,,,,,333333333355555 333,,,777000999 222777999 11,,557799 22,,220022 618 666661111122222 18 Gross sales 44444,,,,,888888888800000 55555,,,,,888883333300000 55555,,,,,555559999999999 11111,,,,,222222222244444 555222444 111,,,444111333 117711 444448888800000 19 Redemptions 44444,,,,,555559999922222 44444,,,,,666668888822222 2222299999,,,,,999998888800000 444440000033333 333555000 888777555 220000 666660000000000 Matched sale-purchase transactions: 20 Gross sales 4444455555,,,,,777778888800000 6666644444,,,,,222222222299999 111115555511111,,,,,222220000055555 1111122222,,,,,444441111177777 222000,,,999777333 111000,,,555222222 16,389 19,828 2233,,228899 2222222222,,,,,666667777755555 21 Gross purchases 4444455555,,,,,777778888800000 6666622222,,,,,888880000011111 111115555522222,,,,,111113333322222 1111122222,,,,,333335555555555 222111,,,222000555 111000,,,444666888 16,180 19,563 2244,,550011 2222211111,,,,,555552222255555 Repurchase agreements: 22 Gross purchases 7777744444,,,,,777775555555555 7777711111,,,,,333333333333333 111114444400000,,,,,333331111111111 2222200000,,,,,333335555555555 111444,,,444000999 111222,,,999444777 26,641 24,108 1166,,660033 1111177777,,,,,666661111122222 23 Gross sales 7777744444,,,,,777779999955555 7777700000,,,,,999994444477777 111113333399999,,,,,555553333388888 2222211111,,,,,222220000033333 111333,,,666444333 111444,,,666555777 24,655 23,477 1188,,882211 2222200000,,,,,111117777733333 24 Net change 11111,,,,,999998888844444 77777,,,,,444443333344444 333,,,888333444 ---333,,,777777333 3,357 2,397 --558888 88888,,,,,666661111100000 -----11111,,,,,222220000022222 -----44444,,,,,111117777799999 Federal agency obligations Outright transactions: 25 Gross purchases 33333,,,,,000008888877777 11111,,,,,666661111166666 27 Redemptions 228888833666669955555 332222 224466 2222222444440000000 2222 2277 2222 1111111111 11 55555 44 Repurchase agreements: 28 Gross purchases 1111,,002222 2233,,220044 1155,,117799 994455 669999 495 776699 11,,007711 705 889977 29 Gross sales 1100,,999933 2222,,773355 1155,,556666 992233 557766 726 667744 888899 949 997766 Bankers acceptances 30 Outright transactions, net --22 551111 116633 --5511 --7788 -31 --6688 --5555 -9 --99 31 Repurchase agreements, net --3366 442200 --3355 --6699 222299 -339 222200 8855 -492 --114400 32 Net change in System Account 99,,222277 66,,114499 88,,553399 --11,,008800 44,,008866 -4,375 33,,557777 22,,558877 -1,332 --44,,330077 1 Both gross purchases and redemptions include special certificates in exchange for maturing bills of the Federal Financing Bank. Acquisition created when the Treasury borrows directly from the Federal Reserve, of these notes is treated as a purchase; the run-off of bills, as a redemption, as follows (millions of dollars): 1973, 1,187; 1974, 131; and 1975, 3,549. 2 In 1975, the System obtained $421 million of 2-year Treasury notes NOTE.—Sales, redemptions, and negative figures reduce holdings of the System Open Market Account; all other figures increase such holdings. Details may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A12 Domestic Nonfinancial Statistics • January 1977 1.18 FEDERAL RESERVE BANKS Condition and F.R. Note Statements Millions of dollars Wednesday End of month 1976 1976 Dec. 1 Dec. Dec. 15 Dec. 22P Dec. 29P Oct. 31 Nov. 30 Dec. 31^ Consolidated condition statement ASSETS Gold certificate account 11,598 11,598 11,598 11,598 11,598 11,598 1,598 Special Drawing Rights certificate account. 1,200 1,200 1,200 1,200 1,200 1,200 1,200 Cash 356 358 361 381 362 Loans: Member bank borrowings 349 24 329 75 375 44 40 Other Acceptances: Bought outright 197 189 195 195 196 197 188 Held under repurchase agreements. 349 513 821 140 Federal agency obligations: Bought outright 6,833 6,833 6,794 6,794 6,794 6,757 6,857 Held under repurchase agreements. 100 218 409 79 U.S. Govt, securities: Bought outright: Bills 35,867 37,944 37,711 37,527 37,345 39,875 37,992 Certificates—Special Other Notes 47,089 47,089 47,089 47,470 47,470 46,897 47,089 Bonds 6,579 6,579 6,579 6,690 6,690 6,506 6,579 To tali 89,535 91,612 91,379 91,687 91,505 93,278 91,660 Held under repurchase agreements. 2,934 6,475 9,454 2,561 17 Total U.S. Govt, securities. 89,535 91,612 94,313 98,162 100,959 95,839 91,660 18 Total loans and securities - • 96,914 98,658 102,080 105,957 109,554 103,056 98,745 19 Cash items in process of collection 9,765 8,717 10,471 11,260 8,644 6,731 8,785 20 Bank premises 364 366 366 367 363 358 364 21 Operating equipment 28 27 27 26 26 26 28 Other assets: 22 Denominated in foreign currencies. 544 545 241 183 175 401 546 23 All other 2,702 2,385 2,526 2,542 2,678 2,985 2,423 24 Total assets. 123,472 123,852 128,867 133,494 134,595 126,736 124,051 LIABILITIES 25 F.R. notes 83,068 83,613 84,034 84,477 84,494 80,389 83,055 Deposits: 26 Member bank reserves 23,567 27,834 30,770 29,352 30,031 26,461 23,239 27 U.S. Treasury—General account. 6,189 3,011 3,328 8,632 9,684 10,238 6,766 28 Foreign 312 292 335 287 257 362 305 29 Other 2 1,176 970 885 840 932 953 1,022 30 Total deposits. 31,244 32,107 35,318 39,111 40,904 38,014 31,332 Deferred availability cash items 5,672 5,107 6,296 6,539 5,630 4,718 6,150 Other liabilities and accrued dividends. 1,026 942 1,023 1,056 1,152 1,165 1,065 33 Total liabilities 121,010 121,769 126,671 131,183 132,180 124,286 121,602 CAPITAL ACCOUNTS 34 Capital paid in 974 974 975 980 984 974 974 35 Surplus 929 929 929 929 929 929 929 36 Other capital accounts. 559 180 292 402 502 547 546 37 Total liabilities and capital accounts 123,472 123,852 128,867 133,494 134,595 126,736 124,051 38 MEMO: Marketable U.S. Govt, securities held in custody for foreign and intl. account 48,233 49,730 50,004 50,319 50,345 47,497 48,000 Federal Reserve note statement 39 F.R. notes outstanding (issued to Bank) 87,682 87,997 8,486 89,035 89,262 85,907 87,650 Collateral held against notes outstanding: 40 Gold certificate account 11,596 11,596 1,596 11,596 11,596 11,595 11,596 41 Special Drawing Rights certificate account.... 643 643 643 643 643 619 643 42 Acceptances 43 U.S. Govt, securities 76,900 77,240 77,490 77,850 78,050 75,680 76,850 44 Total collateral. 89,139 89,479 89,729 90,089 90,289 87,894 89,089 1 Includes securities loaned—fully guaranteed by U.S. Govt, securities 2 includes certain deposits of domestic nonmember banks and foreignpledged with F.R. Banks—and excludes (if any) securities sold and owned banking institutions voluntarily held with member banks and scheduled to be bought back under matched sale-purchase transactions. redeposited in full with F.R. Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Reserve Banks A13 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holdings Millions of dollars Wednesday End of month TTTyyypppeee aaannnddd mmmaaatttuuurrriiitttyyy 1976 1976 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Dec. 29 Oct. 31 Nov. 30 Dec. 31 1 Loans 348 24 329 75 375 45 39 26 2 Within 15 days 306 12 320 66 369 31 33 17 3 16 days to 90 days 42 12 9 9 6 14 6 9 5 Acceptances 197 189 544 708 1,017 337 188 991 6 Within 15 days 106 19 368 532 841 170 27 818 7 16 days to 90 days 59 101 105 108 112 99 99 112 8 91 days to 1 year 32 69 71 68 64 68 62 61 9 U.S. Govt, securities 89,535 91,612 94,313 98,162 100,959 95,839 91,660 97,021 10 Within 15 days i 3,578 4,960 7,161 9,919 13,354 5,831 2,322 7,207 11 16 days to 90 days 16,356 18,153 17,925 17,934 17,200 18,395 19,683 19,221 12 91 days to 1 year 25,860 24,758 25,486 26,120 26,216 27,007 25,914 25,889 13 Over 1 year to 5 years 30,036 30,036 30,036 30,278 30,278 29,559 30,036 30,710 14 Over 5 years to 10 years 8,876 8,876 8,876 8,997 8,997 9,981 8,876 9,045 15 Over 10 years 4,829 4,829 4,829 4,914 4,914 5,066 4,829 4,949 16 Federal agency obligations 6,833 6,833 6,894 7,012 7,203 6,836 6,857 7,072 17 Within 15 days i 138 138 100 259 450 100 206 319 18 16 days to 90 days 214 214 337 296 296 374 167 309 19 91 days to 1 year 992 992 968 968 977 1,021 995 964 20 Over 1 year to 5 years 3,370 3,370 3,364 3,364 3,355 3,234 3,370 3,355 21 Over 5 years to 10 years 1,381 1,381 1,388 1,388 1,388 1,406 1,381 1,388 22 Over 10 years 738 738 737 737 737 701 738 737 1 Holdings under repurchase agreements are classified as maturing within 15 days in accordance with maximum maturity of the agreements. 1.20 DEMAND DEPOSIT ACCOUNTS Debits and Rate of Turnover Seasonally adjusted annual rates 1976 SSttaannddaarrdd mmeettrrooppoolliittaann ssttaattiissttiiccaall aarreeaa 11997733 11997744 11997755 July Aug. Sept. Oct. Nov. Debits (billions of dollars)1 1111 222233333333 SSSSMMMMSSSSAAAA''''ssss 18,641.3 22,192.2 23.565.1 27,102.3 27.875.0 27.250.2 27,406.2 28,081.7 2222 NNNNeeeewwww YYYYoooorrrrkkkk CCCCiiiittttyyyy 8.097.7 9.931.8 10,970.9 13,354.2 13.221.1 12,727.9 13,522.0 13,495.5 3333 222233332222 SSSSMMMMSSSSAAAA''''ssss 10,543.6 12,260.6 12.594.2 13,748.1 14,653.9 14.522.3 13,884.2 14,586.2 4444 6666 lllleeeeaaaaddddiiiinnnngggg SSSSMMMMSSSSAAAA''''ssss ooootttthhhheeeerrrr tttthhhhaaaannnn NNNN....YYYY....CCCC....2222 4.462.8 5,152.7 4,937.5 5,497.7 5,935.8 5,857.3 5,447.9 5,704.2 5555 222222226666 ooootttthhhheeeerrrrssss 6,080.8 7.107.9 7,661.8 8,250.4 8,718.1 8,665.0 8,436.3 8,882.0 Turnover of deposits (annual rate) 6666 222233333333 SSSSMMMMSSSSAAAA''''ssss 110.2 128.0 131.0 145.8 148.6 145.8 146.4 147.3 7777 NNNNeeeewwww YYYYoooorrrrkkkk CCCCiiiittttyyyy 269.8 312.8 351.8 405.0 400.6 393.7 416.2 395.1 8888 222233332222 SSSSMMMMSSSSAAAA''''ssss 75.8 86.6 84.7 89.9 94.8 94.0 89.8 93.2 9999 6666 lllleeeeaaaaddddiiiinnnngggg SSSSMMMMSSSSAAAA''''ssss ooootttthhhheeeerrrr tttthhhhaaaannnn NNNN....YYYY....CCCC....2222 115.0 131.8 118.4 128.6 138.2 136.1 126.6 132.0 11110000 222222226666 ooootttthhhheeeerrrrssss 60.6 69.3 71.6 74.9 78.1 77.7 75.6 78.4 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. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Nonfinancial Statistics • January 1977 1.21 MONEY STOCK MEASURES AND COMPONENTS Billions of dollars; averages of daily figures 1976 11997733 11997744 11997755 DDeecc.. DDeecc.. DDeecc.. IIIttteeemmm June July Aug. Sept. Oct. Nov. Dec.*5 Seasonally adjusted MEASURES i 1 M-1 270.5 283.1 294.8 303.2 304.9 306.4 306.3 309.8 309.8 311.9 2 M-2 571.4 612.4 664.3 698.5 705.4 710.8 716.4 725.8 732.0 739.5 3 M- 3 919.5 981.6 1,092.9 1,157.4 1,169.9 1,182.3 1,195.3 1,211.7 1,223.4 1,236.3 4 M- 4 634.9 702.2 747.2 169 A 774.9 775.1 778.8 787.9 794.0 803.4 5 MS 982.9 1,071.4 1,175.8 1,228.0 1,239.4 1,246.7 1,257.7 1,273.7 1,285.5 1,300.1 COMPONENTS 6 Currency 61.5 67.8 73.7 77.6 78.1 78.6 79.1 79.8 80.3 80.7 Commercial bank deposits: 7 Demand 209.0 215.3 221.0 222255..66 226.8 227.8 227.2 230.0 229.5 231.2 8 Time and savings 364.4 419.1 452.4 465.9 470.0 468.7 472.5 478.0 484.2 491.5 9 Negotiable CD's2 63.5 89.8 82.9 70.6 69.6 64.4 62.4 62.0 62.1 63.8 10 Other 300.9 329.3 369.6 395.3 400.4 404.4 410.1 416.0 422.2 427.6 11 Nonbank thrift institutions3 348.0 369.2 428.6 458.9 464.5 471.6 478.9 485.8 491.4 496.8 Not seasonally adjusted MEASURES i 12 M-1 278.3 291.3 303.2 302.5 305.2 303.1 304.4 308.7 311.8 320.8 13 M-2 576.5 617.5 669.3 699.8 705.8 707.4 712.8 722.9 729.6 744.5 14 M-3 921.8 983.8 1,094.6 1,162.3 1,173.8 1,178.7 1,189.2 1,205.5 1,216.4 1,237.3 15 M-4 640.5 708.0 752.8 768.9 774.6 773.6 778.0 787.1 792.5 808.8 16 MS 985.8 1,074.3 1,178.1 1,231.4 1,242.6 1,245.0 1,254.5 1,269.7 1,279.3 1,301.6 COMPONENTS 17 Currency 62.7 69.0 75.1 77.8 78.7 78.9 79.0 79.6 80.8 82.2 Commercial bank deposits: 18 Demand 215.7 222.2 228.1 224.7 226.5 224.3 225.4 229.1 230.9 238.6 19 Member 156.5 159.7 162.1 159.3 160.2 158.5 159.1 161.8 162.6 168.6 20 Domestic nonmember 56.3 58.5 62.6 62.3 62.8 62.4 63.2 64.1 65.0 66.5 21 Time and savings 362.2 416.7 449.6 466.4 469.4 470.5 473.7 478.4 480.7 488.0 22 Negotiable CD's2 64.0 90.5 83.5 69.1 68.9 66.3 65.3 64.2 62.9 64.3 23 Other 298.2 326.3 366.2 397.3 400.6 404.2 408.4 414.2 417.9 423.7 24 Nonbank thrift institutions3 345.3 366.3 425.3 462.5 468.0 471.3 476.4 482.6 486.8 492.8 25 U.S. Govt, deposits (all commercial banks) 6.3 4.9 44..11 4.8 3.4 3.6 4.9 3.8 4.0 4.4 1 Composition of the money stock measures is as follows: M-A\ M-2 plus large negotiable CD's. M-S: M-3 plus large negotiable CD's. M-1: Averages of daily figures for (1) demand deposits of commercial For a descripton of the latest revisions in the money stock measures, banks other than domestic interbank and U.S. Govt., less cash items in see "Revision of Money Stock Measures" on pp. 82-87 of the February process of collection and F.R. float; (2) foreign demand balances at F.R. 1976 BULLETIN. Banks; and (3) currency outside the Treasury, F.R. Banks, and vaults Latest monthly and weekly figures are available from the Board's H.6 of commercial banks. release. Back data are available from the Banking Section, Division of M-2: M-1 plus savings deposits, time deposits open account, and time Research and Statistics. certificates of deposits (CD's) other than negotiable CD's of $100,000 or 2 Negotiable time CD's issued in denominations of $100,000 or more more of large weekly reporting banks. by large weekly reporting commercial banks. M-3: M-2 plus the average of the beginning and end-of-month deposits 3 Average of the beginning and end-of-month figures for deposits of of mutual savings banks, savings and loan shares, and credit union shares mutual savings banks, for savings capital at savings and loan associations, (nonbank thrift). and for credit union shares. NOTES TO TABLE 1.23: 1 Adjusted to exclude domestic commercial interbank loans. "Other securities," and $600 million in "Total loans and investments." 2 Loans sold are those sold outright to banks' own foreign branches, As of Oct. 31, 1974, "Total loans and investments" of all commercial nonconsolidated nonbank affiliates of the bank, the banks' holding banks were reduced by $1.5 billion in connection with the liquidation company (if not a bank), and nonconsolidated nonbank subsidiaries of of one large bank. Reductions in other items were: "Total loans," $1.0 the holding company. Prior to Aug. 28, 1974, the institutions included billion (of which $0.6 billion was in "Commercial and industrial loans"), had been defined somewhat differently, and the reporting panel of banks and "Other securities," $0.5 billion. In late November "Commercial and was also different. On the new basis, both "Total loans" and "Com- industrial loans" were increased by $0.1 billion as a result of loan remercial and industrial loans" were reduced by about $100 million. classifications at another large bank. 3 Reclassification of loans reduced these loans by about $1.2 billion as of Mar. 31, 1976. NOTE.—Data are for last Wednesday of month except for June 30 4 Data beginning June 30, 1974, include one large mutual savings and Dec. 31; data are partly or wholly estimated except when June 30 bank that merged with a nonmember commercial bank. As of that date and Dec. 31 are call dates. there were increases of about $500 million in loans, $100 million in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Aggregates A15 1.22 AGGREGATE RESERVES AND DEPOSITS Member Banks Billions of dollars; averages of daily figures 1976 IItteemm 11997733,, 11997744,, 11997755,, j j DDeecc.. DDeecc.. DDeecc.. Mar. Apr. May June July Aug. Sept. Oct. Nov. Seasonally adjusted 1 Reserves1 34.98 36.63 34.75 34.00 34.02 34.14 34.34 34.39 34.52 34.36 34.49 34.88 2 Nonborrowed 33.69 35.90 34.62 33.95 33.98 34.02 34.21 34.25 34.42 34.30 34.39 34.81 3 Required 34.68 36.37 34.49 33.78 33.87 33.93 34.12 34.15 34.32 34.16 34.27 34.62 4 Deposits subject to reserve requirements2... 442.8 486.9 506.0 507.8 509.8 507.8 513.9 514.9 513.6 515.3 519.6 525.3 279.7 322.9 338.7 339.4 340.2 338.3 342.3 344.2 341.1 342.6 345.9 350.0 Demand: 6 Private 158.1 160.6 164.4 165.8 167.2 167.2 167.9 168.0 168.7 168.9 170.3 170.8 7 U.S. Govt 5.0 3.4 3.0 2.5 2.5 2.3 3.7 2.7 3.9 3.8 3.4 4.5 8 Deposits plus nondeposit items3 449.4 495.3 514.4 516.0 517.3 515.3 522.3 523.6 522.5 523.5 528.6 534.4 Not seasonally adjusted 9 Deposits subject to reserve requirements2. .. 447.5 491.8 510.9 506.4 511.9 506.0 512.7 513.9 511.3 514.9 518.9 522.5 10 Time and savings 278.5 321.7 337.2 339.6 340.2 339.9 342.5 343.7 342.7 344.1 346.7 347.6 Demand: 11 Private 164.0 166.6 170.7 163.9 168.8 163.4 166.7 167.7 165.9 167.2 169.5 171.9 12 U.S. Govt 5.0 3.5 3.1 2.9 2.9 2.8 3.6 2.5 2.7 3.6 2.8 3.0 13 Deposits plus nondeposit items 3 454.0 500.1 519.3 514.7 519.4 513.6 521.2 522.7 520.2 523.1 527.9 531.5 1 Series reflects actual reserve requirement percentages with no adjust- deposits except those due to the U.S. Govt., less cash items in process of ment to eliminate the effect of changes in Regulations D and M. There collection and demand balances due from domestic commercial banks. are breaks in series because of changes in reserve requirements effective 3 "Total member bank deposits" subject to reserve requirements, plus Dec. 12, 1974; Feb. 13, May 22, and Oct. 30, 1975; and Jan. 8, 1976. Euro-dollar borrowings, loans sold to bank-related institutions, and In addition, effective Jan. 1, 1976, statewide branching in New York certain other nondeposit items. This series for deposits is referred to as was instituted. The subsequent merger of a number of banks raised "the adjusted bank credit proxy." required reserves because of higher reserve requirements on aggregate deposits at these banks. NOTE.—Back data and estimates of the impact on required reserves 2 Includes total time and savings deposits and net demand deposits as of changes in reserve requirements are shown in Table 14 of the Board's defined by Regulation D. Private demand deposits include all demand Annual Statistical Digest, 1971-1975. 1.23 LOANS AND INVESTMENTS All Commercial Banks Billions of dollars End of year 1976 Category 1973 19744 1975 June 30 July 28 Aug. 25 Sept. 29 Oct. 27 Nov. 24 Dec. 31 V P v V V V p Seasonally adjusted t Loans and investments1 633.4 690.4 721.1 738.8 743.1 748.7 752.5 760.3 766.3 767.5 2 Including loans sold outright2 637.7 695.2 725.5 743.3 747.6 752.7 756.4 764.1 770.1 771.3 Loans: 3 Total 449.0 500.2 496.9 500.7 504.7 507.6 511.4 519.3 521.8 521.6 4 Including loans sold outright2 453.3 505.0 501.3 505.2 509.2 511.6 515.3 523.1 525.6 525.4 5 Commercial and industrial3 156.4 183.3 176.0 170.2 171.0 171.0 172.0 174.8 176.7 176.2 6 Including loans sold outright2,3 159.0 186.0 178.5 173.0 173.8 173.5 174.5 177.2 179.1 178.6 Investments: 7 U.S. Treasury 54.5 50.4 79.4 94.0 92.7 95.0 94.0 93.5 94.3 96.5 8 Other 129.9 139.8 144.8 144.1 145.7 146.1 147.1 147.5 150.2 149.4 Not seasonally adjusted 9 Loans and investments1 647.3 705.6 737.0 743.3 740.3 746.1 752.9 758.7 766.0 784.4 10 Including loans sold outright 651.6 710.4 741.4 747.8 744.8 750.1 756.8 762.5 769.8 788.2 Loans: 11 Total i 458.5 510.7 507.4 507.2 505.2 508.5 513.3 518.2 520.6 532.6 12 Including loans sold outright2 462.8 515.5 511.8 511.7 509.7 512.5 517.2 522.0 524.4 536.4 13 Commercial and industrial3 159.4 186.8 179.3 172.4 170.7 170.3 172.5 174.2 176.0 179.5 14 Including loans sold outright2,3 162.0 189.5 181.8 175.2 173.5 172.8 175.0 176.6 178.4 181.9 Investments : 15 U.S. Treasury 58.3 54.5 84.1 90.8 89.5 91.8 92.6 93.5 96.9 101.7 16 Other 130.6 140.5 145.5 145.3 145.6 145.8 147.0 147.0 148.6 150.2 For notes see bottom of opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Nonfinancial Statistics • January 1977 1.24 COMMERCIAL BANK ASSETS AND LIABILITIES Last-Wednesday-of-Month Series Billions of dollars, except for number of banks 1974 1975 1976 3 Account Dec. 31 Dec. 31 Apr. 28p May 26 p June 30v July 28 *> Aug. 25 p Sept. 29* Oct. 21p Nov. 24p Dec. 29p All commerical j Loans and investments 744.1 775.8 765.6 766.8 779.8 772.5 782.1 790.4 796.9 805.6 826.4 2 Loans, gross 549.2 546.2 530.2 531.8 543.7 537.6 544.5 550.8 556.4 560.2 576.0 Investments: 3 U.S. Treasury securities 54.5 84.1 90.2 90.4 90.8 89.5 91.8 92.6 93.5 96.9 101.2 4 Other 140.5 145.5 145.2 144.6 145.3 145.5 145.8 146.9 147.0 148.6 149.2 5 Cash assets 128.0 133.6 113.2 111.7 125.2 111.5 109.1 118.7 115.2 124.3 128.7 6 11.7 12.3 12.1 12.0 12.0 12.2 12.0 12.2 12.5 11.8 13.9 7 Reserves with Federal Reserve Banks 27.1 26.8 27.8 26.2 27.1 28.0 25.4 29.7 26.4 29.1 29.9 8 Balances with banks 42.0 47.3 35.3 36.1 40.4 34.6 36.1 36.1 36.7 40.2 39.8 9 Cash items in process of collection.. 47.3 47.3 37.9 37.4 45.7 36.7 35.6 40.6 39.5 43.3 45.1 10 Total assets/total liabilities and 919.6 964.9 926.4 927.7 957.1 934.3 940.5 960.0 962.6 982.9 1,010.8 11 Deposits 747.9 786.3 753.1 754.1 782.8 761.2 759.4 773.3 777.9 789.1 812.4 Demand: 12 Interbank 43.5 41.8 32.3 33.1 38.3 33.1 33.4 35.2 34.8 39.9 39.1 13 U.S. Government 4.8 3.1 4.1 3.5 4.7 3.5 3.7 5.8 3.7 3.3 3.4 14 Other 267.5 278.7 250.2 247.5 266.4 250.6 247.4 252.9 258.2 260.8 275.9 Time: 15 11.5 12.0 11.0 10.5 10.6 10.2 9.7 9.5 9.1 9.0 9.2 16 Other 420.6 450.6 455.6 459.4 462.9 463.8 465.3 469.9 472.2 476. 1 484.8 17 Borrowings 58.4 60.2 68.5 66.2 65.9 66.8 72.3 77.5 76.0 83.6 88.0 18 Total capital accounts2 63.7 69.1 70.6 71.4 72.1 72.2 72.5 73.1 73.7 74.1 75.0 19 MEMO : Number of banks 14,465 14,633 14,632 14,637 14,636 14,635 14,649 14,655 14,659 14,659 14,659 Member 20 Loans and investments 568.5 578.6 567.4 567.1 577.5 570.1 578.2 583.6 588.6 595.3 612.7 21 Loans, gross 429.5 416.4 402.1 402.3 411.7 405.3 410.8 415. 1 419.5 421.9 435.3 Investments: 22 U.S. Treasury securities 38.9 61.5 64.9 65.0 65.6 64.4 66.7 67.0 67.7 70.8 74.3 23 Other 100.1 100.7 100.3 99.7 100.2 100.3 100.7 101.5 101.4 102.6 103.1 24 Cash assets, total 107.0 108.5 93.7 92.3 104.0 92.3 89.4 98.9 94.9 103.0 107.6 25 Currency and coin 8.8 9.2 9.1 9.1 9.0 9.1 9.0 9.2 9.4 8.9 10.5 26 Reserves with Federal Reserve Banks 27.1 26.8 27.8 26.2 27.1 28.0 25.4 29.8 26.4 29.1 29.9 27 Balances with banks 25.5 26.9 20.1 20.9 23.8 19.6 20.5 20.6 20.9 23.3 23.5 28 Cash items in process of collection.. 45.6 45.5 36.7 36.1 44. 1 35.5 34.4 39.3 38.2 41.8 43.7 29 Total assets/Total liabilities and capital1 715.6 733.6 702.1 702.3 726.8 706.2 710.7 726.8 772277..66 744.8 776699..11 30 575.6 590.8 561.1 561.2 585.3 565.1 562.4 573.9 576.1 584.8 604.6 Demand: 31 Interbank 41.1 38.6 29.9 30.7 35.6 30.7 30.9 32.7 32.2 37.2 36.4 32 U.S. Government 3.2 2.3 3.3 2.7 3.7 2.7 2.8 4.3 2.9 2.4 2.5 33 Other 204.2 210.8 189.4 187.0 202.1 188.6 185.9 191.0 194.7 196.0 208.6 Time: 34 Interbank 10.1 10.0 9.0 8.5 8.6 8.1 7.6 7.5 7.1 7.0 7.2 35 Other 317.1 329.1 329.6 332.3 335.4 334.9 335.1 338.4 339.2 342.1 349.9 36 Borrowings 52.9 53.6 62.0 59.6 59.3 60.3 65.9 70.6 69.1 76.4 80.4 37 Total capital accounts 2 48.2 52.1 53.8 54.5 55.0 55.1 55.4 55.7 56.2 56.6 57.3 38 MEMO: Number of banks 5,780 5,788 5,775 5,777 5,776 5,767 5,771 5,773 5,768 5,768 5,768 1 Includes items not shown separately. NOTE.—Figures include all bank-premises subsidiaries and other sig- Effective Mar. 31, 1976, some of the item "reserve for loan losses" nificant majority-owned domestic subsidiaries. and all of the item "unearned income on loans" are no longer reported Commercial banks: All such banks in the United States, including as liabilities. As of that date the "valuation" portion of "reserve for member and nonmember banks, stock savings banks, nondeposit trust loan losses" and the "unearned income on loans" have been netted companies, and U.S. branches of foreign banks, but excluding one naagainst "other assets," and against "total assets" as well. tional bank in Pureto Rico and two in the Virgin Islands. Total liabilities continue to include the deferred income tax portion of Member banks: The following numbers of noninsured trust companies "reserve for loan losses." that are members of the Federal Reserve System are excluded from mem- 2 Effective Mar. 31, 1976, includes "reserves for securities" and the ber banks in Tables 1.24 and 1.25 and are included with noninsured banks contingency portion (which is small) of "reserve for loan losses." in Table 1.25: 1974—June, 2; December, 3; 1975—June and December, 3 Figures partly estimated except on call dates. 4; 1976 (beginning month shown)—July, 5. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A17 1.25 COMMERCIAL BANK ASSETS AND LIABILITIES Call-Date Series Millions of dollars except for number of banks 1974 1975 1974 1975 AAccccoouunntt June 30 Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Dec. 31 Total insured National (all insured) 1 Loans and investments-—Gross 709,904 734,516 736,164 762,400 418,329 428,433 428,167 441,135 Loans: ? 3 Net 52 ( 1 2 , ) 4 24 54 ( 1 2 ,1 ) 1 1 52 ( 6 2 , ) 2 72 53 ( 52, ) 1 70 31 ( 3 2 ,6 ) 59 32 ( 1 2 , ) 4 66 31 ( 22,2 ) 29 31 ( 52,7 ) 38 Investments: 4 U.S. Treasury securities 51,832 54,132 67,833 83,629 27,631 29,075 37,606 46,799 Other 136,648 139,272 142,060 143,602 77,039 77,892 78,331 78,598 6 Cash assets 123,536 125,375 125,181 128,256 73,703 76,523' 75,686 78,026 7 Total assets/total liabilities1 871,986 906,325 914,781 944,654 516,632 534,207 536,836 553,285 8 Deposits, total 770033,,776677 741,665 746,348 775,209 407,915 431,039 431,646 447,590 Demand: 9 U.S. Government 8,355 4,799 3,106 3,108 5,038 2,437 1,723 1,788 10 40,534 42,587 41,244 40,259 20,086 23,497 21,096 22,305 11 Other 225500,,222255 265,444 261,903 276,384 145,954 154,397 152,576 159,840 Time: 12 Interbank 8,427 10,693 10,252 10,733 4,912 6,750 6,804 7,302 13 Other 396,226 418,142 429,844 444,725 231,925 243,959 249,446 256,355 14 Borrowings 65,514 55,988 59,310 56,775 48,123 39,603 41,954 40,875 15 Total capital accounts 61,003 63,039 65,986 68,474 34,966 35,815 37,483 38,969 16 MEMO: Number of banks 14,108 14,216 14,320 14,372 4,693 4,706 4,730 4,741 State member (all insured) Insured nonmember 17 Loans and investments—Gross 132,388 140,373 134,759 137,620 159,186 165,709 173,238 183,645 Loans: 1 1 9 8 N Gr e o t s . s . ... 10 ( 1 2 , ) 7 32 10 ( 8 2 , ) 3 46 10 ( 0 2 , ) 9 68 10 ( 0 2 , ) 8 23 10 ( 6 2 , ) 0 33 11 ( 1 2 . ) 3 00 11 ( 3 2 , ) 0 74 11 ( 8 2 , ) 6 09 Investments: 20 U.S. Treasury securities 8,303 9,846 12,004 14,720 15,898 15,211 18,223 22,109 21 Other 22,353 22,181 21,787 22,077 37,255 39,199 41,942 42,927 22 Cash assets 35,268 30,473 31,466 30,451 14,565 18,380 18,029 19,778 23 Total assets/total liabilities 175,896 181,683 179,787 180,495 179,457 190,435 198,157 210,874 24 Deposits, total 113399,,444466 144,799 141,995 143,409 156,406 165,827 172,707 184,210 Demand: 25 U.S. Government 1,586 746 443 467 1,731 1,616 940 853 26 Interbank 19,125 17,565 18,751 16,265 1,323 1,525 1,397 1,689 27 Other 4477,,669900 4499,,880077 48,621 50,984 56,580 61,240 60,706 65,560 Time: 28 Interbank 2,906 3,301 2,111 2,712 610 642 676 719 29 Other 68,138 73,380 71,409 72,981 96,162 100,804 108,989 115,389 30 Borrowings 14,713 13,247 14,380 12,771 2,678 3,138 2,976 3,128 31 Total capital accounts 11,980 12,425 12,773 13,105 14,057 14,799 15,730 16,400 32 MEMO: Number of banks 1,068 1,074 1,064 1,046 8,347 8,436 8,526 8,585 Noninsured nonmember Total nonmember 33 Loans and investments—Gross 9,269 9,981 11,725 13,674 168,456 175,690 184,963 197,319 Loans: 3 3 4 5 N G e r t o ss ( 7 2 ,9 ) 8 7 ( 8 2 ,4 ) 6 1 ( 9 2 ,5 ) 5 9 1 ( 1 2 ,2 ) 8 3 11 ( 4 2 . ) 0 20 11 ( 92,7 ) 6 1 12 ( 2 2 , ) 6 33 12 ( 9 2 , ) 8 92 Investments: 36 U.S. Treasury securities 282 319 358 490 16,180 15,530 18,581 22,599 37 Other 1,001 1,201 1,808 1,902 38,256 40,400 43,750 44,829 38 Cash assets 2,951 2,667 3,534 5,359 17,516 21,047 21,563 25,137 39 Total assets/total liabilities 12,770 13,616 16,277 20,544 192,227 204,051 214,434 231,418 40 Deposits, total 6,610 6,627 8,314 11,323 163,016 172,454 181,021 195,533 Demand: 41 U.S. Government 12 8 11 6 1,743 1,624 951 859 42 Interbank 1,481 897 1,338 1,552 2,804 2,422 2,735 3,241 43 Other 22,,220099 2,062 2,124 2,308 58,789 63,302 62,830 67,868 Time: 44 Interbank 476 803 957 1,291 1,086 1,445 1,633 2,010 45 Other 2,432 2,857 3,883 6,167 98,593 103,661 112,872 121,556 46 Borrowings 2,033 2,382 3,110 3,449 4,711 5,520 6,086 6,577 47 Total capital accounts 620 611 570 651 14,677 15,410 16,300 17,051 48 MEMO: Number of banks 229 249 253 261 8,576 8,685 8,779 8,846 1 Includes items not shown separately. For Note see Table 1.24. 2 Not available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A18 Domestic Nonfinancial Statistics • January 1977 1.26 COMMERCIAL BANK ASSETS AND LIABILITIES Detailed Balance Sheet, March 31, 1976 Asset and liability items are shown in millions of dollars Member banks1 Insured Asset account commercial Large banks banks Total All other New York City of Other City Chicago large 1 Cash bank balances, items in process 119,026 101,773 26,340 4,185 39,319 31,929 2 Currency and coin 11,216 8,440 714 158 2,845 4,723 3 Reserves with F.R. Banks 28,525 28,525 4,702 2,065 11,946 9,812 4 Demand balances with banks in United States. 27,671 17,248 6,704 102 3,187 7,255 5 Other balances with banks in United States. . . 6,586 4,267 40 16 1,593 2,618 6 Balances with banks in foreign countries 2,910 2,530 169 41 1,465 856 7 Cash items in process of collection 42,119 40,763 14,010 1,803 18,283 6,666 8 Total securities held—Book value... 229,529 162,998 17,581 7,459 53,826 84,131 9 U.S. Treasury 10 Other U.S. Govt, agencies 11 States and political subdivisions. 12 All other securities 13 Unclassified total 14 Trading-account securities 5,664 5,584 2,364 772 2,189 259 15 U.S. Treasury 16 Other U.S. Govt, agencies 17 States and political subdivisions. 18 All other trading acct. securities . 19 Unclassified 20 Bank investment portfolios 223,866 157,414 15,218 6,687 51,637 83,872 21 U.S. Treasury 85,372 61,367 7,315 3,137 20,840 30,074 22 Other U.S. Govt, agencies 32,946 20,181 873 324 5,869 13,115 23 States and political subdivisions . 100,143 72,384 6,666 3,083 24,090 38,545 24 All other portfolio securities 5,404 3,482 363 143 838 2,138 25 F.R. stock and corporate stock 1,506 1,259 243 82 457 478 26 Federal funds sold and securities resale agreement. 36,012 27,144 1,684 1,484 13,321 10,655 27 Commercial banks 31,447 22,809 979 1,110 10,490 10,231 28 Brokers and dealers 3,200 3,019 352 344 2,008 314 29 Others 1,365 1,316 354 30 824 109 30 Other loans, gross 491,706 379,905 68,332 20,815 143,842 146,916 31 LESS: Unearned income on loans. 11,218 7,829 407 83 2,741 4,599 32 Reserves for loan loss 6,063 4,858 1,081 331 1,812 1,634 33 Other loans, net 474,425 367,217 66,844 20,401 139,289 140,683 Other loans, gross, by category 34 Real estate loans 138,289 98,570 8,778 2,007 36,408 51,377 35 Construction and land development. 15,933 13,096 3,203 502 6,177 3,214 36 Secured by farmland 6,111 2,644 6 15 287 2,336 37 Secured by residential 78,348 56,662 3,954 923 20,954 30,831 38 1- to 4-family residences 73.858 53,355 3,509 827 19,709 29,309 39 FH A-insured 8,212 7,109 560 52 3,888 2,608 40 Conventional 65,646 46,246 2,949 775 15,821 26,700 41 Multifamily residences 4,489 3,308 445 96 1,245 1,522 42 FH A-insured 431 365 126 25 100 113 43 Conventional 4,058 2,943 318 71 1,144 1,409 44 Secured by other properties 37,897 26,167 1,615 567 8,990 14,996 45 Loans to financial institution 37,463 35,575 13,065 4,773 14,762 2,976 46 To real estate investment trusts 10,381 10,072 3,877 1,536 3,930 728 47 To domestic commercial banks 3,069 2,407 799 111 1,066 431 48 To banks in foreign countries 5,687 5,560 2,526 327 2,299 408 49 To other depositary institutions 2,408 2,281 601 15 1,495 170 50 To other financial institutions 15,918 15,254 5,262 2,783 5,971 1,238 51 Loans to security brokers and dealers... 6,125 6,017 4,085 627 1,182 122 52 Other loans to purch./carry securities.. . 3,868 3,238 405 315 1,619 900 53 Loans to farmers—except real estate 20,433 11,379 78 170 2,607 8,525 54 Commercial and industrial loans 167,013 138,858 34,725 10,642 54,574 38,917 55 Loans to individuals 105,656 74,915 4,846 1,604 27,305 41,220 56 Instalment loans 83.122 58,675 3,291 903 21,704 32,777 57 Passenger automobiles 34,120 22,443 489 157 6,895 14,902 58 Residential-repair/modernize 5,853 4,175 261 35 1,739 2,140 59 Credit cards and related plans 11,922 10,519 1,080 511 6,032 2,897 60 Charge-account credit cards 9,216 8,270 772 481 4,828 2,190 61 Check and revolving credit plans. 2,707 2,249 308 30 1,204 707 62 Other retail consumer goods 15.123 10,491 183 92 3,836 6,380 63 Mobile homes 8,628 6,187 107 36 2,279 3,765 64 Other 6,494 4,304 76 56 1,557 2,615 65 Other instalment loans 16,103 11,046 1,278 108 3,201 6,458 66 Single-payment loans to individuals. . 22,535 16,300 1,555 701 5,601 8,443 67 All other loans 12.859 11,293 2,350 678 5,386 2,879 68 Total loans and securities, net 741,472 558,618 86,352 29,426 206,893 235,947 69 Direct lease financing 4,200 3,988 636 129 2,619 604 70 Fixed assets—Buildings, furniture, real estate. 17,833 13,368 1,454 560 5,438 5,916 71 Investment in unconsolidated subsidiaries... . 1,982 1,958 810 152 925 71 72 Customer acceptances outstanding 9,731 9,440 4,814 350 3,992 284 73 Other assets 25,301 22,440 7,940 1,677 9,061 3,761 74 Total assets. 919,546 711,585 128,347 36,481 268,246 278,512 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A19 1.26 Continued Member banks1 IIInnnsssuuurrreeeddd NNNooonnn--- Liability or capital ooommmmmmeeerrrccciiiaaalll Large banks mmmeeemmmbbbeeerrr account bbbaaannnkkksss bbbaaannnkkksss111 TToottaall AAllll ootthheerr New York City of Other City Chicago large 75 Demand deposits 294,953 231,623 52,202 8,997 83,922 86,501 63,331 76 Mutual savings banks 1,033 941 432 2 222 284 92 77 Other individuals, partnerships, and corporations. 228,651 173,801 29,202 6,577 65,625 72,397 54,849 78 U.S. Government 2,474 1,798 121 25 661 990 676 79 States and political subdivisions 15,860 11,183 502 191 3,471 7,019 4,677 80 Foreign governments, central banks, etc 1,434 1,388 1,168 18 172 30 47 81 Commercial banks in United States 29,608 28,550 13,167 1,756 10,215 3,413 1,058 82 Banks in foreign countries 5,482 5,353 4,089 136 1,011 117 130 83 Certified and officers' checks, etc 10,410 8,610 3,522 291 2,545 2,252 1,801 84 Time deposits 285,241 213,442 3333,,220000 1133,,446666 78,373 88,402 71,799 85 Accumulated for personal loan payments 197 152 12 139 45 86 Mutual savings banks 553 537 297 2 193 45 16 87 Other individuals, partnerships, and corporations. 219,140 161,988 22,954 9,460 58,504 71,069 57,152 88 U.S. Government 618 478 91 1 201 186 141 89 States and political subdivisions 46,328 32,819 1,032 1,442 14,147 16,198 13,508 90 Foreign governments, central banks, etc 8,550 8,337 5,122 1,136 2,047 33 213 91 Commercial banks in United States 8,504 7,843 3,001 1,340 2,786 716 661 92 Banks in foreign countries 1,351 1,288 703 86 482 17 63 93 Savings deposits 179,421 129,091 8,650 2,706 47,534 70,201 50,330 94 Individuals and nonprofit organizations 170,989 123,059 8,247 2,616 45,430 66,767 47,930 95 Corporations and other profit organizations 5,437 3,978 192 66 1,677 2,042 1,459 96 U.S. Government 2,926 1,988 161 23 418 1,385 938 97 All other 69 65 50 8 7 3 98 Total deposits 759,615 574,155 94,053 25,169 209,828 245,105 185,460 99 Federal funds purchased and securities sold under agreements to repurchase 57,248 54,654 11,733 7,536 27,819 7,566 2,594 100 Commercial banks 35,330 34,269 6,625 5,261 18,388 3,995 1,061 101 Brokers and dealers 5,609 5,409 751 1,001 2,967 689 200 102 Others 16,309 14,976 4,357 1,273 6,464 2,881 1,333 103 Other liabilities for borrowed money 4,467 4,164 1,913 58 1,872 321 304 104 Mortgage indebtedness 770 554 53 16 304 182 216 105 Bank acceptances outstanding 10,385 10,094 5,431 352 4,026 285 291 106 Other liabilities 15,212 13,223 4,266 897 5,164 2,897 2,065 107 Total liabilities 847,697 656,844 117,448 34,028 249,013 256,355 190,930 108 Subordinated notes and debentures 4,549 3,676 916 84 1,698 978 873 109 Equity capital 67,300 51,065 99,,998833 2,368 17,535 21,178 16,240 110 Preferred stock 53 34 10 24 20 111 Common stock 15,699 11,631 2,259 570 3,875 4,928 4,070 112 Surplus 27,112 20,277 3,906 1,149 7,279 7,944 6,836 113 Undivided profits 22,710 17,906 3,745 600 5,962 7,600 4,807 114 Other capital reserves 1,725 1,218 75 50 410 684 508 115 Total liabilities and equity capital 919,546 711,585 128,347 36,481 268,246 278,512 208,043 MEMO: 116 Demand deposits adjusted2 220,752 160,512 24,904 5,413 54,763 75,432 60,241 Average for last 15 or 30 days: 117 Average cash and due from bank 117,460 101,147 26,918 4,255 38,935 31,039 16,316 118 Average Federal funds sold and securities purchased under agreements to resell 36,716 27,406 1,767 1,379 12,856 11,404 9,340 119 Average total loans 486,101 371,737 68,027 20,768 140,866 142,077 114,363 120 Average time deposits of $100,000 or more 144,427 120,645 30,152 11,156 50,764 28,574 23,781 121 Average total deposits 751,437 567,916 91,522 25,125 207,676 243,593 183,520 122 Average Federal funds purchased and securities sold under agreements to repurchase 59,318 56,753 14,503 7,312 27,223 7,715 2,565 123 Average other liabilities for borrowed money. . . . 4,093 3,813 1,666 47 1,815 286 280 124 Standby letters of credit outstanding 9,756 9,304 4,800 950 2,940 614 452 125 Time deposits of $100,000 or more 143,154 120,398 29,959 11,210 50,471 28,758 22,756 126 Certificates of deposit 119,853 99,898 24,706 9,051 40,992 25,148 19,955 127 Other time deposits 23,301 20,501 5,253 2,159 9,478 3,610 2,800 128 Number of banks 14,368 5,778 11 9 155 5,603 8,595 1 Member banks exclude and nonmember banks include 5 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 domember banks exclude 2 national banks outside the continental United mestic subsidiaries. Securities are reported on a gross basis before deduc- States. tions of valuation reserves. Holdings by type of security will be reported 2 Demand deposits adjusted are demand deposits other than domestic as soon as they become available. commercial interbank and U.S. Govt., less cash items reported as in Back data in lesser detail were shown in previous BULLETINS. Details process of collection. may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 Domestic Nonfinancial Statistics • January 1977 1.27 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS Assets and Liabilities Millions of dollars, Wednesday figures Nov. 10 Nov. 17 Nov. 24 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Dec. 29 1 Total loans and investments 400,713 404,376 401,562 409,164 409,928 415,285 414,897 415,938 Loans: 2 Federal funds sold, total1 22,476 20,729 19,424 22,865 23,262 23,936 24,385 24,113 3 To commercial banks 17,692 16,777 15,842 16,872 18,638 18,938 19,926 19,758 To brokers and dealers involving— 4 U.S. Treasury securities 3,053 2,584 2,142 3,842 2,619 3,065 2,638 2,275 5 Other securities 551 493 608 747 791 761 722 830 6 To others 1,180 875 832 1,404 1,214 1,172 1,099 1,250 7 Other, gross 282,028 284,001 282,871 286.506 286,149 288,852 288,461 289,021 8 Commercial and industrial 114,274 114,604 115,005 115.507 115,581 116,425 116,544 116,460 9 Agricultural 4,198 4,201 4,175 4,216 4,174 4,194 4,211 4,262 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities 1,198 1,801 1,213 2,283 2,047 2,075 1,569 1,538 11 Other securities 7,026 7,179 6,801 1,1 AO 7,484 8,558 8,254 8,233 To others: 12 U.S. Treasury securities 70 72 70 70 72 74 74 79 13 Other securities 2,520 2,537 2,525 2,524 2,530 2,505 2,506 2,501 To nonbank financial institutions: 14 Personal and sales finance cos., etc 6,901 6,914 6,863 6,974 6,849 7,258 7,233 7,490 15 Other 16,989 16,900 16,698 16,889 16,903 17,058 16,850 17,007 16 Real estate 62,952 63,166 63,184 63,227 63,289 63,505 63,501 63,482 To commercial banks: 17 Domestic 1,697 1,913 1,877 2,071 1,921 1,789 1,920 1,936 18 Foreign 5,938 6,137 6,015 6,030 6,216 5,982 5,980 6,112 19 Consumer instalment 38,362 38,404 38,493 38,531 38,613 38,840 39,079 39,345 20 Foreign governments, official institutions, etc. 1,949 1,894 1,857 1,930 1,907 1,876 1,863 1,822 21 All other loans 17,954 18,279 18,095 18,514 18,563 18,713 18,877 18,754 22 LESS: Loan loss reserve and unearned income on loans 8,669 8,695 8,751 8,708 8,734 8,740 8,726 8,643 23 Other loans, net 273,359 275,306 274,120 277,798 277,415 280,112 279,735 280,378 Investments: 24 U.S. Treasury securities, total 44,621 47,356 47,046 47,615 48,203 49,777 49,432 50,148 25 Bills 11,055 11,770 10,903 11,526 11,461 12,835 12,428 13,285 Notes and bonds, by maturity— 26 Within 1 year 6,499 6,431 6,465 6,557 6,741 6,713 6,685 6,812 27 1 to 5 years 22,473 24,377 24,945 24,833 25,715 26,082 26,106 25,854 28 After 5 years 4,594 4,778 4,733 4,699 4,286 4,147 4,213 4,197 29 Other securities, total 60,257 60,985 60,972 60,886 61,048 61,460 61,345 61,299 Obligations of States and political subdivisions: 30 Tax warrants, short-term notes, and bills 6,447 6,997 6,685 6,689 6,713 6,893 6,656 6,524 31 All other 40,156 40,205 40,232 40,151 40,358 40,613 40,384 40,488 Other bonds, corporate stocks, and securities: 32 Certificates of participation2 2,297 2,257 2,284 2,297 2,301 2,266 2,320 2,360 33 All other, including corporate stocks... 11,357 11,526 11,771 11,749 11,676 11,688 11,985 11,927 34 Cash items in process of collection 35,513 37,084 37,785 43,259 35,890 45,042 42,353 40,077 35 Reserves with Federal Reserve Banks 20,589 20,333 22,049 16,606 21,516 24,198 22,396 24,282 36 Currency and coin 5,299 5,546 5,378 5,783 5,550 5,827 5,793 6,329 37 Balances with domestic banks 12,240 12,453 13,603 13,227 13,261 13,306 14,120 13,791 38 Investments in subsidiaries not consolidated .... 2,251 2,230 2,239 2,280 2,287 2,287 2,390 2,345 39 Other assets 47,173 45,927 48,519 49,381 47,795 49,824 48,889 50,303 40 Total assets/total liabilities 523,778 527,949 531,135 539,700 536,227 555,769 550,838 553,065 Deposits : 41 Demand deposits, total 166,946 170,239 171,492 183,073 170,509 190,763 182,181 181,677 42 Individuals, partnerships, and corporations . 121,185 124,120 120,934 130,287 123,875 135,580 131,503 130,649 43 States and political subdivisions 5,953 6,240 6,282 6,597 5,550 6,243 6,594 6,058 44 U.S. Govt 1,625 1,760 1,440 1,385 1,064 5,623 2,085 1,654 Domestic interbank: 45 Commercial 23,770 24,130 28,187 27,430 24,761 26,360 26,686 27,362 46 Mutual savings 914 831 756 890 877 871 744 743 Foreign: 47 Governments, official institutions, etc 1,197 1,054 1,686 1,440 1,134 1,357 1,228 1,412 48 Commercial banks 5,886 5,810 5,978 5,811 5,845 5,545 5.670 5,951 49 Certified and officers' checks 6,416 6,294 6,229 9,233 7,403 9,184 7.671 7,848 50 Time and savings deposits, total3 222,787 222,843 224,359 224,828 226,790 227,221 229,223 231,178 Individuals, partnerships, and corporations: 51 Savings 85,361 85,762 86,175 86,851 SI,169 88,381 88,702 89,338 52 Other 104,148 104,171 105,379 105,244 106,316 105,499 106,427 107,421 53 States and political subdivisions 18,657 18,522 18,650 18,410 18,336 18,827 19,214 19,334 54 Domestic interbank 5,493 5,566 5,584 5,557 5,567 5,521 5,626 5,708 55 Foreign governments, official institutions, etc. 7,793 7,511 7,262 7,476 7,508 7,710 7,956 8,015 56 Federal funds purchased, etc.4 67,778 67,443 67,506 64,562 71,709 68,719 72,342 72,086 Borrowings from: 57 Federal Reserve Banks 95 11 30 317 1 298 50 319 58 Others 4,216 4,825 4,616 4,325 4,392 4,161 3,929 4,118 59 Other liabilities, etc. 5 21,115 21,837 22,393 21,730 21,809 23,671 22,079 22,412 60 Total equity capital and subordinated notes/debentures6 40,841 40,751 40,739 40,865 41,017 40,936 41,034 41,275 1 Includes securities purchased under agreements to resell. 5 Includes minority interest in consolidated subsidiaries and deferred 2 Federal agencies only. tax portion of reserves for loans. 3 Includes U.S. Govt, and foreign bank deposits not shown separately. 6 Includes reserves for securities and contingency portion of reserves 4 Includes securities sold under agreements to repurchase. for loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Banks A21 1.28 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1976 Account Nov. 10 Nov. 17 Nov. 24 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Dec. 29 1 Total loans and investments 88,083 90,925 89,862 91,743 91,612 93,895 92,743 93,144 2 3 Lo F a e n T d s o e : r a co l f m u m nd e s r c s i o a l l d , b t a o n ta k l s 1 1,5 7 5 2 2 3 1,7 9 2 8 2 7 1 1 , , 9 2 9 8 4 6 2 1 , , 0 1 6 4 4 9 2 1 , , 4 3 0 8 2 4 2 1 , , 4 5 5 2 2 7 2 1 , , 8 8 3 2 9 0 2 3, , 0 2 1 6 5 9 4 6 5 T T o o O U b o . t S r t h h o . e e k r T r e s s r r e e s c a u a su n ri r d t y i e d s s e e a c l u e r r i s t i i e n s volving— 2 5 6 2 4 0 7 2 4 2 9 2 1 0 6 9 4 2 4 3 2 9 8 1 6 27 0 3 8 2 5 5 3 1 9 1 0 7 9 2 4 4 6 2 3 7 1 7 6 3 4 2 5 6 0 3 2 44 7 2 7 8 1 7 9 8 Ot C A he o g r m r , ic m g u r e l o t r s u c s r i a a l l and industrial 6 3 8 3 , , 4 8 2 0 9 4 5 5 6 3 9 3 , , 9 7 7 9 4 4 8 9 6 3 8 4 , . 7 2 2 5 9 2 4 9 7 3 1 4 , , 3 6 1 6 4 1 9 9 2 3 7 4 0, , 5 7 1 8 0 0 6 5 1 3 7 5 1, , 9 1 1 6 8 0 0 7 2 3 7 4 0, , 8 9 1 7 5 1 3 1 0 3 70 5 , , 9 0 1 1 3 1 1 9 8 For purchasing or carrying securities : 1 1 0 1 To U O b . t S r h o . e k r T e r s r e e s c a u a su n r r i d t y i e d s s e e a c l u e r r i s t : ie s 3,9 9 5 6 2 7 4 1 , , 1 5 3 8 8 4 3,7 9 3 7 4 8 2 4 , , 0 5 5 0 3 0 4 1 , , 1 8 8 5 5 0 5 1 , , 0 8 1 5 6 4 4 1 , , 8 3 2 4 9 4 4 1 , , 6 3 1 2 0 2 1 1 3 2 To O U o t .S t h h . e e r T r s r s e : e c a u su ri r t y ie s s ecurities 36 1 7 3 36 1 9 4 37 1 1 4 38 1 0 3 37 1 1 4 36 1 0 4 36 1 1 6 35 1 7 6 1 1 1 4 5 6 T R o e P O a n e l t r o h e s n e s o r b t n a a a t n e l k a n fi d n a s n al c e i s a l f i i n n a s n ti c t e u t c i o o s n . s , : e tc 2 9 6 , , , 3 0 1 2 9 3 1 3 2 2 9 6 , , , 3 0 1 5 7 1 5 5 8 9 2 6 , , , 0 3 08 1 3 9 0 0 2 6 8 , , , 0 4 9 8 2 3 7 0 4 2 6 8 , , , 2 0 9 5 3 0 5 5 0 2 6 8 , , , 5 0 9 4 1 3 8 1 6 2 5 8 , , , 9 4 9 9 4 7 1 3 3 6 2 8 , , , 0 6 9 0 6 8 1 1 8 2 2 1 1 1 1 0 9 7 8 F A T C o o l o l D r F n e c o o o s i o t u r g m h m e n m e i e m g r g e s n r t o e l i o v r c i c a e n i r n s a n t s l a m l b m e a n e n t n k s t , s : o fficial institu •. t ions, etc. 2 3 3 , , , 6 7 9 6 6 4 5 8 7 3 3 4 2 0 0 4 2 3 , , , 0 7 9 7 5 0 1 5 9 5 3 8 0 7 6 4 2 3 , , , 0 7 8 7 5 0 3 3 5 1 7 8 3 4 1 2 4 3 , , , 7 0 9 6 8 9 1 9 1 0 7 2 2 2 8 2 4 3 , , , 9 0 9 7 5 2 0 7 1 5 8 2 3 3 4 2 4 3 , , , 8 0 9 5 4 5 9 2 6 9 3 3 4 6 6 2 3 3 , , , 8 9 9 6 4 0 7 6 2 8 6 9 6 4 0 2 3 3 , , , 8 9 9 5 4 4 3 9 8 3 9 9 0 7 4 2 2 2 3 LESS: O Lo th o a e n n r l l l o o o a s a s n n s r s e , s n er e v t e and unearned income 66 1 , , 7 6 3 9 2 2 68 1 , , 0 7 4 0 5 4 66 1 , , 9 7 9 2 6 6 69 1 , , 6 7 4 2 1 8 68 1 , , 8 7 5 3 1 5 70 1 , , 2 7 2 3 8 2 69 1 , , 1 7 4 2 8 5 69 1 , , 2 6 1 9 7 4 2 2 5 4 Inv U e . s B S t . i m ll T s e n re t a s: s ury securities, total 10 3 , , 4 1 9 4 1 8 1 3 1, , 7 7 4 0 1 3 11 3 , , 4 3 4 1 5 9 1 2 0 , ,5 9 6 0 8 5 1 2 1, , 1 8 3 8 6 4 11 3 , , 6 3 7 5 2 2 1 2 1, , 2 6 3 6 1 3 1 2 1, , 4 8 8 7 5 8 2 2 2 2 6 8 7 9 Ot N he o A W r 1 t e f s t i t s o e t e h c r a 5 u i n n r 5 y d i t e y 1 i a e b e y r s a o e , s r n a s t d r o s t , a l b y maturity— 9 5 1 , , , 3 1 4 7 0 0 4 9 8 1 3 9 9 5 1 , , , 4 8 3 8 1 8 4 1 7 1 4 3 9 6 1 , , , 4 0 1 8 2 9 9 4 7 4 2 0 5 9 1 , , , 8 4 1 6 7 6 7 2 7 1 0 5 6 9 1 , , , 4 2 0 7 3 2 2 9 9 3 2 1 6 9 , , 6 5 6 9 6 4 9 6 5 3 1 4 6 9 1 , , , 5 8 0 6 2 7 4 5 5 7 0 1 6 9 1 , , , 7 1 6 A 5 7 7 l 3 6 8 l Obligations of States and political 3 3 0 1 T A a l s x l u o b t w h d a e i r v r r i a s n io ts n , s : s hort-term notes, and bills. 6 1 , , 1 3 2 6 8 9 6 1 , , 0 57 3 1 2 6 1 , , 0 4 8 1 9 3 6 1 , , 1 4 0 2 8 2 6 1 , , 0 4 8 1 6 4 6 1 , , 3 5 2 1 7 8 6 1 , , 1 5 8 0 7 5 6 1 , , 2 3 5 8 8 1 Other bonds, corporate stocks, and 3 3 2 3 A Ce ll s r e t o c i t f u h ic r e a i r t t i , e e s i s n : o c f l u p d a in rt g i c c ip or a p ti o o r n a 2 t e stocks 1,5 2 7 3 2 9 1,5 2 8 3 1 3 1,6 2 9 3 1 4 1,7 2 0 3 3 7 1,4 2 8 3 6 7 1,4 2 6 3 7 1 1,6 2 0 3 3 0 1,5 2 5 3 7 1 3 3 3 3 3 3 5 7 4 6 8 9 I C B R C O n a u e a t v h l s s r a e e h e r s n r e r t v c i n m t a e e c e s s s e y m s n w w e s a t t s i i n s t t i n h d h in p d c F s o r o e u o i m d n b c e s e e r i s s d a s t l i i a c o R r f b i e e c a s s o e n l r n k l v e o s e c t t B i c o o a n n n s k o s l idated 1 1 5 7 1 6 2 , , , , , 8 1 2 0 7 7 7 1 4 7 5 1 1 7 7 9 5 5 1 1 5 6 1 1 4 , , , , , 5 0 0 9 9 7 6 8 8 4 7 6 9 3 9 6 2 5 1 1 6 6 1 6 2 , , , , , 1 5 9 0 9 7 3 0 7 4 4 1 9 1 0 7 2 4 1 1 5 3 1 6 6 , , , , , 9 9 0 4 5 7 8 5 7 2 6 9 1 1 4 2 0 3 1 1 6 6 1 5 3 , , , , , 4 0 5 0 2 7 7 5 6 5 0 7 5 8 7 4 6 3 1 1 7 5 1 7 6 , , , , , 3 9 0 2 6 8 4 8 8 5 3 0 6 3 7 6 2 6 1 1 6 5 1 6 4 , , , , , 6 6 0 5 2 7 6 4 5 4 2 7 9 0 6 1 3 9 1 1 6 6 1 5 7 , , , , , 6 8 0 2 1 8 5 2 6 6 4 5 5 3 8 7 4 1 40 Total assets/total liabilities 131,867 131,349 134,175 136,524 134,745 143,005 137,651 140,952 4 4 4 4 2 3 4 1 De D po e I S U m s n t i . a d a S t t s i n . e v : d s i G d a d o u n e v a p d e l o s r , p s n i o p m ts l a , i e r t n i t t c o n t a t e a l r l s s h u i b p d s i , v a is n i d on c s o rporati . ons . 4 2 7 6 , , 7 7 2 5 0 5 2 2 4 1 2 9 4 2 7 7 , , 5 4 5 1 4 3 2 6 6 4 2 6 5 2 0 5 , , 6 6 6 1 1 4 0 5 5 8 0 3 5 3 5 0 , , 7 2 6 3 6 5 9 2 1 1 2 4 2 9 7 , , 2 0 4 2 0 8 9 0 1 1 6 5 3 7 2 1 , , , 9 5 1 5 4 4 6 2 2 9 6 7 5 2 2 9 , , 9 8 6 2 8 9 4 2 6 4 3 9 5 2 4 9 , , 6 7 4 1 1 3 9 1 1 7 2 9 4 4 6 5 Do C M m o u e m t s u t m i a c e l r i s c n a i t v a e i l r n b g a s nk: 11,3 5 2 0 1 6 10,8 4 3 3 4 7 15,0 3 8 8 7 2 13,4 4 5 7 2 1 11,9 4 7 9 7 2 12,7 4 5 7 3 8 12,8 3 8 8 2 2 14,3 3 1 9 8 8 4 4 4 5 7 9 8 0 Tim C Fo e e G C r r a t e o o i n i f m v g i d e e n m d r s : n a e a m v r n i c n e d ia g n l s o t s f b d , f e a i o c p n e f o k f r s i s s c i ' t i s a c , l h i t e o n c t s k a t s P i t utions, etc . 4 4 0 2 , , , 5 5 8 9 4 4 7 6 2 4 0 1 4 4 2 0, , , 7 9 4 7 2 0 7 7 4 9 0 4 4 4 2 1 1 , , , , 2 5 7 3 9 5 9 9 6 8 7 0 4 4 1 5 1 , , , , 5 1 5 1 4 9 0 0 0 6 0 9 41 4 3 , , , 7 4 8 8 6 7 6 3 7 7 3 3 4 5 1 4 1 , , , , 3 3 1 0 5 1 0 4 0 9 8 2 41 4 3 , , , 7 2 8 9 1 3 1 0 2 6 3 7 42 4 4 1 , , , , 3 3 0 1 1 4 6 3 5 6 8 3 5 5 5 5 5 2 1 3 4 5 I D S F n t o o a d O S r m t i a e e v th v e i s i g d s i e n n a t r u i g n c a g s d l o s i n v , p e t o p e r l a r n i b r t m i t a c n n e a e n k l r t s s s h u , i b o p d f s f i , i v c a i i s a n i l d o i n n c s s o ti r t p u o ti r o a n ti s o , n et s c : . 2 4 9 2 2 1 , , , , , 5 3 4 0 2 6 6 8 9 7 6 3 9 5 4 2 4 2 9 2 1 , , , , , 3 4 5 3 2 2 6 7 5 4 9 3 4 3 3 2 4 9 2 3 1 , , , , , 1 5 4 0 2 9 5 4 8 4 8 9 6 2 0 2 2 4 9 3 1 , , , , , 4 2 3 4 2 8 6 4 8 0 7 6 1 9 6 2 4 2 9 3 1 , , , , , 2 6 3 6 1 3 0 4 7 5 7 3 5 9 9 2 4 2 9 3 1 , , , , , 2 2 6 2 1 3 7 5 7 5 7 7 5 8 8 2 2 4 9 3 1 , , , , , 2 3 7 6 1 1 2 1 0 2 6 4 5 9 2 2 4 2 9 4 1 , , , , , 3 2 0 8 1 3 6 3 2 2 1 7 3 4 4 56 Federal funds purchased, etc.4 20,747 19,434 18,813 16,546 21,053 19,068 20,401 20,566 5 5 5 7 9 8 B O o t F O h rr e e t d o r h w e e l r r i i a a s n b l g i s R l it e f i r s e e o s r m , v e e : t c B . 5 an ks 99 22 ,, ,, 00 11 11 00 99 22 44 55 9 2 , , 6 2 9 9 1 7 9 2 , , 4 34 5 1 6 2 8 , , 0 7 3 0 0 1 7 9 0 2 8 , , 2 7 3 5 5 4 1 2 0 , , 1 7 1 0 1 1 3 2 0 8 1 , , 9 9 2 1 9 8 9 2 , , 6 0 7 6 4 3 4 5 60 Total n o e t q e u s i / t d y e b ca en pi t t u a r l e a s6 n d subordinated 11,663 11,657 11,654 11,680 11,716 11,720 11,705 11,678 1 Includes securities purchased under agreements to resell. 5 Includes minority interest in consolidated subsidiaries and deferred 2 Federal agencies only. tax portion of reserves for loans. . 3 Includes U.S. Government and foreign bank deposits not shown 6 Includes reserves for securities and contingency portion of reserves separately. for loans. 4 Includes securities sold under agreements to repurchase. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 Domestic Nonfinancial Statistics • January 1977 1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS OUTSIDE NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1976 Nov. 10 Nov. 17 Nov. 24 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Dec. 29 1 Total loans and investments. 312,630 313,451 311,700 317,421 318,316 321,390 322,154 322,794 Loans: Federal funds sold, total1 20,924 19,007 17,430 20,801 20,860 21,484 21,546 21,098 To commercial banks 16,969 15,790 14,556 15,723 17,254 17,411 18,106 17,489 To brokers and dealers involving— U.S. Treasury securities 2,511 2,094 1,704 3,240 2,022 2,598 1,992 1,997 Other securities 524 474 559 712 689 724 702 809 To others 920 649 611 1,126 895 751 746 803 Other, gross 213,604 214,252 214,149 215,137 215,563 216,892 217,588 218,110 Commercial and industrial 80,469 80,630 80,751 80,858 80,876 81,238 81,593 81,421 Agricultural 4,103 4,103 4,076 4,104 4,073 4,092 4,101 4,144 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities 231 217 235 230 197 221 225 216 11 Other securities 3,074 3,041 3,067 3,240 3,299 3,542 3,425 3,623 To others: 12 U.S. Treasury securities 57 58 56 57 58 60 58 63 13 Other securities 2,153 2,168 2,154 2,144 2,159 2,145 2,145 2,144 To nonbank financial institutions: 14 Personal and sales finance cos., etc 4,580 4,559 4,553 4,554 4,594 4,710 4,790 4,829 15 Other 10,857 10,782 10,609 10,802 10,868 11,022 10,859 11,006 16 Real estate 53,859 54,091 54,154 54,293 54,389 54,594 54,528 54,494 To commercial banks: 17 Domestic 1,027 1,116 1,123 1,263 1,208 1,223 1,296 1,349 18 Foreign 3,295 3,419 3,277 3,233 3,288 3,129 3,174 3,263 19 Consumer instalment 34,380 34,401 34,486 34,539 34,611 34,847 35,100 35,355 20 Foreign governments, official institutions, etc. 1,319 1,338 1,346 1,318 1,353 1,380 1,383 1,388 21 All other loans 14,200 14,329 14,262 14,502 14,590 14,689 14,911 14,815 22 LESS : Loan reserve and unearned income on loans 6,977 6,991 7,025 6,980 6,999 7,008 7,001 6,949 23 Other loans, net 206,627 207,261 207,124 208,157 208,564 209,884 210,587 211,161 Investments: U.S. Treasury securities, total 34,130 35,615 35,601 37,047 37,067 38,105 38,201 38,663 Bills 7,907 8,067 7,584 8,621 8,577 9,483 9,765 10,407 Notes and bonds, by maturity— Within 1 year 5,700 5,618 5,625 5,932 5,950 6,022 6,034 6,134 1 to 5 years 17,372 18,496 18,851 18,956 19,276 19,417 19,266 19,101 After 5 years 3,151 3,434 3,541 3,538 3,264 3,183 3,136 3,021 Other securities, total 50,949 51,568 51,545 51,416 51,825 51,917 51,820 51,872 Obligations of States and political subdivisions: Tax warrants, short term notes, and bills. 5,078 5,426 5,272 5,267 5,299 5,375 5,151 5,143 All other 34,028 34,173 34,143 34,043 34,272 34,286 34,197 34,230 Other bonds, corporate stocks, and securities: Certificates of participation2 2,058 2,024 2,050 2,060 2,064 2,035 2,090 2,129 All other, including corporate stocks 9,785 9,945 10,080 10,046 10,190 10,221 10,382 10,370 34 Cash items in process of collection 22,734 25,095 24,838 26,699 22,684 27,755 27,812 24,810 35 Reserves with Federal Reserve Banks 13,472 14,250 15,910 12,625 15,041 16,852 16,727 17,459 36 Currency and coin 4,584 4,781 4,664 4,990 4,777 5,021 5,014 5,478 37 Balances with domestic banks 6,393 6,884 7,033 7,253 7,203 7,323 7,480 7,136 38 Investments in subsidiaries not consolidated . 1,196 1,184 1,197 1,229 1,233 1,231 1,334 1,277 39 Other assets 30,902 30,955 31,618 32,959 32,228 33,192 32,666 33,159 40 Total assets/total liabilities. 391,911 396,600 396,960 403,176 401,482 412,764 413,187 412,113 Deposits: Demand deposits, total 119,242 122,693 120,877 127,341 121,289 132,821 129,195 127,066 Individuals, partnerships, and corporations . 94,434 96,686 95,286 100,026 96,874 103,414 101,609 100,912 States and political subdivisions 5,424 5,718 5,682 5,946 5,069 5,716 5,951 5,566 U.S. Government 1,403 1,594 1,287 1,293 968 4,074 1,856 1,535 Domestic interbank: Commercial 12,449 13,296 13,100 13,978 12,784 13,607 13,804 13,044 Mutual savings 408 394 374 419 385 393 362 345 Foreign: Governments, official institutions, etc 236 280 296 331 301 315 321 279 Commercial banks 1,342 1,340 1,420 1,311 1,382 1,426 1,434 1,605 Certified and officers' checks 3,546 3,385 3,432 4,037 3,526 3,876 3,858 3,780 Time and savings deposits, total3 182,245 182,119 183,063 183,288 185,023 185,871 187,511 188,863 Individuals, partnerships, and corporations: Savings 75,995 76,333 76,729 77,362 78,132 78,703 78,980 79,514 Other 82,053 81,818 82,297 81,903 82,671 82,241 82,818 83,388 States and political subdivisions 17,383 17,279 17,410 17,204 17,177 17,672 18,099 18,210 Domestic interbank 3,004 2,992 3,025 3,070 3,188 3,244 3,410 3,441 Foreign governments, official institutions, etc. 3,230 3,148 3,064 3,210 3,305 3,473 3,632 3,684 56 Federal funds purchased, etc.4 47,031 48,009 48,693 48,016 50,656 49,651 51,941 51,520 Borrowings from: 57 Federal Reserve Banks 11 30 7 1 118888 50 21A 58 Others 2,112 2,528 2,275 2,318 2,157 22,,005588 2,011 2,054 59 Other liabilities, etc. 5 12,103 12,146 12,937 13,021 13,055 1122,,995599 13,150 12,739 60 Total equity capital and subordinated notes/debentures 6 29,178 29,094 29,085 29,185 29,301 29,216 29,329 29,597 1 Includes securities purchased under agreements to resell. 5 Includes minority interest in consolidated subsidiaries and deferred 2 Federal agencies only. tax portion of reserves for loans. 3 Includes U.S. Government and foreign bank deposits not shown 6 Includes reserves for securities and contingency portion of reserves separately. for loans. 4 Includes securities sold under agreements to repurchase. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Banks A23 1.30 LARGE WEEKLY REPORTING COMMERCIAL BANKS Balance Sheet Memoranda Millions of dollars, Wednesday figures 1976 Account and bank group Nov. 10 Nov. 17 Nov. 24 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Total loans (gross) and investments, adjusted:1 1 Large banks 285,115 286,040 284,576 290,428 288,852 292,061 291,000 2 New York City banks 68,583 69,687 68,676 71,476 70,891 72,319 71,268 3 Banks outside New York City 216,532 216,353 215,900 218,952 217,961 219,742 219,732 Total loans (gross), adjusted: 4 Large banks 389,993 394,381 392,594 398,929 398,103 403,298 401,777 5 New York City banks 88,382 90,845 89,548 91,514 91,250 93,534 92,024 6 Banks outside New York City 301,611 303,536 303,046 307,415 306,853 309,764 309,753 Demand deposits, adjusted:2 7 Large banks 106,038 107,265 104,080 110,999 108,794 113,738 111,057 8 New York City banks 23,382 24,557 22,428 25,628 23,9*1 26,353 25,334 9 Banks outside New York City 82,656 82,708 81,652 85,371 84,853 87,385 85,723 Large negotiable time CD's included in time and savings deposits:3 Total: 10 Large banks 62,795 62,626 63,444 63,310 64,151 63,474 64,708 11 New York City 21,407 21,611 22,118 22,222 22,275 21,798 22,218 12 Banks outside New York City 41,388 41,015 41,326 41,088 41,876 41,676 42,490 Issued to IPC's: 13 Large banks 41,333 41,325 42,340 42,117 42,966 42,201 42,991 14 New York City Banks 13,809 14,083 14,775 14,925 15,190 14,751 15,176 15 Banks outside New York City 27,524 27,242 27,565 27.192 27,776 27,450 27,815 Issued to others: 16 Large banks 21,462 21,301 21,104 21.193 21,185 21,273 21,717 17 New York City banks 7,598 7,528 7,343 7,297 7,085 7,047 7,042 13,864 13,773 13,761 13,896 14,100 14,226 14,675 18 Banks outside New York City All other large time deposits:4 Total: 26,242 25,955 25,938 25,615 25,571 25,987 26,168 19 Large banks 5,804 5,696 5,673 5,611 5,575 5,457 5,321 20 New York City banks 20,438 20,259 20,265 20,004 19,996 20,530 20,847 21 Banks outside New York City Issued to IPC's: 15,184 15,100 15,015 14,832 14,852 14,723 14,560 22 Large banks 4,357 4,316 4,290 4,231 4,211 4,120 4,011 23 New York City banks 10,827 10,784 10,725 10,601 10,641 10,603 10,549 24 Banks outside New York City Issued to others: 11,058 10,855 10,923 10,783 10,719 11,264 11,608 25 Large banks 1,447 1,380 1,383 1,380 1,364 1,337 1,310 26 New York City banks 9,611 9,475 9,540 9,403 9,355 9,927 10,298 27 Banks outside New York City Savings deposits, by ownership category: Individuals and nonprofit organizations: 28 Large banks 79,639 79,876 80,143 80,420 80,877 81,178 81,430 29 New York City banks 8,697 8,713 8,739 8,766 8,860 8,920 8,961 30 Banks outside New York City 70,942 71,163 71,404 71,654 72,017 72,258 72,469 Partnerships and corporations for profit:5 31 Large banks 4,046 4,088 4,209 4,276 4,386 4,378 4,378 32 New York City banks 378 387 403 411 419 429 434 33 Banks outside New York City 3,668 3,701 3,806 3,865 3,967 3,949 3,944 Domestic governmental units: 34 Large banks 1,620 1,738 1,771 2,087 2,415 2,747 2,818 35 New York City banks 251 281 259 253 282 267 266 36 Banks outside New York City 1,369 1,457 1,512 1,834 2,133 2,480 2,552 All other:6 37 Large banks 56 60 52 68 91 78 76 38 New York City banks 40 48 45 59 76 62 61 39 Banks outside New York City 16 12 7 9 15 16 15 Gross liabilities of banks to their foreign branches: Large banks 3,918 5,058 5,340 4,621 4,849 6,452 5,181 New York City banks 2,979 4,132 4,232 3,776 4,033 5,521 4,214 Banks outside New York City 939 926 1,108 845 816 931 967 Loans sold outright to selected institutions by all large banks:7 Commercial and industrial 2,416 2,402 2,401 2,404 2,381 2,367 2,352 Real estate 218 218 218 216 215 215 216 All other 1,136 1,162 1,177 1,160 1,166 1,160 1,179 1 Exclusive of loans and Federal funds transactions with domestic 5 Other than commercial banks. commercial banks. 6 Domestic and foreign commercial banks, and official international 2 All demand deposits except U.S. Govt, and domestic commercial organizations. banks, less cash items in process of collection. 7 To bank's own foreign branches, nonconsolidated nonbank af- 3 Certificates of deposit (CD's) issued in denominations of $100,000 or filiates of the bank, the bank's holding company (if not a bank), and more. nonconsolidated nonbank subsidiaries of the holding company. 4 All other time deposits issued in denominations of $100,000 or more, (not included in large negotiable CD's). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 Domestic Nonfinancial Statistics • January 1977 1.31 LARGE WEEKLY REPORTING COMMERCIAL BANKS Commercial and Industrial Loans Millions of dollars Outstanding Net change during— Industry group 1976 1976 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Dec. 29 Q3 Q4 Oct. Nov. Dec. Total loans classified2 1 Total 95,569 95,652 96,647 96,560 96,214 -641 3,556 1,153 1,352 1,051 Durable goods manufacturing: 2 Primary metals 2,157 2,149 2,213 2,181 2,195 -36 133 -49 83 99 3 Machinery 4,604 4,589 4,649 4,641 4,602 -417 -15 -25 28 -18 4 Transportation equipment 2,227 2,186 2,240 2,254 2,238 -252 -188 -131 -120 63 5 Other fabricated metal products... 1,709 1,733 1,712 1,700 1,697 -56 11 -24 46 -11 6 Other durable goods 3,360 3,372 3,371 3,315 3,258 -109 -245 -88 -47 -110 Nondurable goods manufacturing: 7 Food, liquor, and tobacco 3,377 3,368 3,350 3,499 3,496 3 130 18 24 88 8 Textiles, apparel, and leather 3,233 3,195 3,119 3,063 2,978 178 -521 -104 -141 -276 9 Petroleum refining 2,466 2,494 2,559 2,580 2,633 217 113 40 -53 126 10 Chemicals and rubber 2,536 2,576 2,569 2,565 2,542 41 17 102 -89 4 11 Other nondurable goods 1,935 1,911 1,935 1,917 1,904 -34 23 -34 86 -29 12 Mining, including crude petroleum and natural gas 7,237 7,246 7,269 7,254 77,,227711 229 331111 222299 5511 3311 Trade: 13 Co mmodity dealers 1,907 1,963 1,995 1,871 1,911 -212 355 267 115 -27 14 Other wholesale 6,211 6,203 6,217 6,265 6,208 189 175 93 85 -3 15 Retail 6,653 6,598 6,715 6,499 6,163 19 -177 168 183 -528 16 Transportation 5,168 5,141 5,156 5,195 5,232 -496 48 -58 -4 110 17 Communication 1,447 1,344 1,406 1,434 1,350 -263 -139 -75 -20 -44 18 Other public utilities 5,625 5,570 5,660 5,649 5,597 -526 -102 -118 -43 59 19 Construction 3,986 3,981 3,989 3,990 3,899 -51 -292 -12 -130 -150 20 Services 10,447 10,399 10,461 10,506 10,513 -174 108 30 2 76 21 All other domestic loans 7,834 7,809 7,787 7,816 7,946 385 586 180 277 129 22 Bankers acceptances 55,,665533 5,962 6,468 6,509 6,777 629 3,190 809 1,105 1,276 23 Foreign commercial and industrial loans 5,797 5,863 5,807 5,857 5,804 95 35 -65 -86 186 MEMO: 24 Commercial paper included in total classified loans1 441133 --114422 8877 --1166 2222 8811 25 Total commercial and industrial loans of all large weekly reporting banks 115,507 115,581 116,425 116,544 116,460 -391 4,078 1,123 1,500 1,455 1976 1976 Aug. 25 Sept. 29 Oct. 27 Nov. 24 Dec. 29 Q3 Q4 | Oct. Nov. Dec. "Term" loans classified3 26 Total 44,179 44,772 44,462 44,823 45,171 -545 399 -310 361 348 Durable goods manufacturing: 27 Primary metals 1,146 1,214 1,191 1,253 1,316 -27 102 -23 62 6633 28 Machinery 2,748 2,675 2,592 2,637 2,565 -354 -110 -83 45 -72 29 Transportation equipment 1,354 1,381 1,315 1,303 1,351 -124 -30 -66 -12 48 30 Other fabricated metal products... 765 756 747 777 771 -43 15 -9 30 -6 31 Other durable goods 1,758 1,736 1,668 1,655 1,619 -79 -117 -68 -13 -36 Nondurable goods manufacturing: 32 Food, liquor, and tobacco 1,463 1,435 1,425 1,392 1,397 32 -38 -10 -33 5 33 Textiles, apparel, and leather 1,159 1,144 1,125 1,118 1,094 28 -50 -19 -7 -24 34 Petroleum refining 1,606 1,908 1,931 1,864 1,970 201 62 23 -67 106 35 Chemicals and rubber 1,460 1,464 1,486 1,449 1,443 -2 -21 22 -37 -6 36 Other nondurable goods 948 935 930 950 953 -51 18 -5 20 3 37 Mining, including crude petroleum and natural gas 55,,113377 55,,334422 55,,551144 55,,551177 55,,668811 122 339 172 3 116644 Trade: 38 Commodity dealers 186 209 220 218 200 2 -9 11 -2 -18 39 Other wholesale 1,340 1,394 1,400 1,474 1,460 86 66 6 74 -14 40 Retail 2,080 2,134 2,173 2,249 2,063 102 -71 39 76 -186 41 Transportation 3,941 3,934 3,883 3,809 3,933 -303 -1 -51 -74 124 42 Communication 948 903 910 913 847 -87 -56 7 3 -66 43 Other public utilities 3,685 3,604 3,523 3,549 3,664 -304 60 -81 26 115 44 Services 1,711 1,696 1,708 1,669 1,629 -48 -67 12 -39 -40 45 Construction 4,926 4,967 4,886 5,151 4,991 -130 24 -81 265 -160 46 All other domestic loans 22,,335566 22,,441199 22,,444477 22,,556677 22,,660000 69 181 28 120 33 47 Foreign commercial and industrial loans 3,462 3,522 3,388 3,309 3,624 365 102 -134 -79 315 1 Reported for the last Wednesday of each month. all outstanding loans granted under a formal agreement—revolving credit 2 Includes "term" loans, shown below. or standby—on which the original maturity of the commitment was in 3 Outstanding loans with an original maturity of more than 1 year and excess of 1 year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Deposits and Commercial Paper A25 1.32 GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations Billions of dollars; estimated daily-average balances All commercial banks TTTyyypppeee ooofff hhhooollldddeeerrr 1975 1976 11997722,, 11997733,, 11997755,, DDeecc.. DDeecc.. DDeecc.. Mar. June Sept. Dec. Mar. June Sept. 11111 AAAAAHHHHH hhhhhooooollllldddddeeeeerrrrrsssss,,,,, IIIIIPPPPPCCCCC 208.0 220.1 225.0 216.3 222.2 227.0 236.9 227.9 234.2 235.8 22222 FFFFFiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 18.9 19.1 19.0 18.6 19.4 19.0 20.1 19.9 20.3 19.6 109.9 116.2 118.8 111.3 115.1 118.7 125.1 116.9 121.2 121.3 44444 CCCCCooooonnnnnsssssuuuuummmmmeeeeerrrrr 65.4 70.1 73.3 73.2 74.8 76.5 78.0 77.2 78.8 80.2 55555 FFFFFooooorrrrreeeeeiiiiigggggnnnnn 1.5 2.4 2.3 2.3 2.3 2.2 2.4 2.4 2.5 3.3 66666 OOOOOttttthhhhheeeeerrrrr 12.3 12.4 11.7 10.9 10.6 10.6 11.3 11.4 11.4 11.4 All weekly reporting banks 1976 11997733,, 11997744,, 11997755,, DDeecc.. DDeecc.. DDeecc.. May June July Aug. Sept. Oct. Nov.f 77777 AAAAAllllllllll hhhhhooooollllldddddeeeeerrrrrsssss,,,,, IIIIIPPPPPCCCCC 118.1 119.7 124.4 118.2 122.6 122.5 112.9 121.5 123.8 129.8 88888 FFFFFiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 14.9 14.8 15.6 15.7 16.1 16.3 15.0 15.3 16.8 16.2 99999 NNNNNooooonnnnnfffffiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 66.2 66.9 69.9 67.8 67.3 64.8 61.4 65.7 68.4 70.2 1111100000 CCCCCooooonnnnnsssssuuuuummmmmeeeeerrrrr 28.0 29.0 29.9 26.4 31.2 33.3 29.2 31.4 29.6 31.4 2.2 2.2 2.3 2.2 2.0 2.3 1.8 2.5 2.4 2.5 1111122222 OOOOOttttthhhhheeeeerrrrr 6.8 6.8 6.6 6.1 6.1 5.8 5.6 6.6 6.6 9.5 NOTE.—Figures include cash items in process of collection. Estimates of banks. Types of depositors in each category are described in the June 1971 gross deposits are based on reports supplied by a sample of commercial BULLETIN, p. 466. 1.33 COMMERCIAL PAPER AND BANKERS ACCEPTANCES OUTSTANDING Millions of dollars, end of period 1976 Instrument 1973, 1974, 1975, Dec. Dec. Dec. May June July Aug. Sept. Oct. Nov. 1 Commercial paper, all issuers 41,073 49,144 47,690 50,537 50,011 51,138 59,063 49,814 51,334 53,080 Financial companies:1 Dealer-placed paper:2 2 Total 5,487 4,611 6,239 6,443 6,075 6,187 6,243 6,347 6,674 7,113 3 Bank-related 1,938 1,814 1,762 1,724 1,710 1,655 1,650 1,681 1,739 1,860 Directly placed paper:3 4 Total 27,204 31,839 31,276 31,866 31,198 32,513 31,500 31,438 31,844 32,655 5 Bank-related 2,943 6,518 6,892 5,974 6,297 5,936 5,938 6,213 5,828 5,775 6 Nonfinancial companies4 8,382 12,694 10,175 12,228 12,738 12,438 12,320 12,029 12,816 13,312 7 Dollar acceptances, total 8,892 18,484 18,727 19,681 19,783 19,544 19,383 19,599 20,312 20,678 Held by— 8 Accepting banks 2,837 4,226 7,333 6,175 6,171 r5,905 6,107 6,798 7,959 9,031 9 Own bills 2,318 3,685 5,899 5,397 5,378 5,255 5,449 5,865 6,789 7,706 10 Bills bought 519 542 11,,443355 778 793 r650 658 933 1,170 1,325 F.R. Banks: 11 Own account 68 999 1,126 875 1,027 656 808 838 337 188 12 Foreign correspondents 581 1,109 293 440 427 447 442 417 387 349 13 Others 5,406 12,150 9,975 12,147 12,157 12,968 12,026 12,299 11,629 12,184 Based on— 14 Imports into United States 2,273 4,023 3,726 4,267 4,384 4,611 4,530 4,498 4,737 4,667 15 Exports from United States 3,499 4,067 4,001 4,304 4,308 4,327 4,355 4,420 4,715 4,628 16 All other 3,120 10,394 11,000 11,110 11,091 10,606 10,498 10,680 10,860 11,383 1 Institutions engaged primarily in activities such as, but not limited to, 3 As reported by financial companies that place their paper directly commercial, savings, and mortgage banking; sales, personal, and mortgage with investors. financing; factoring, finance leasing, and other business lending; insurance 4 Includes public utilities and firms engaged primarily in activities such underwriting; and other investment activities. as communications, construction, manufacturing, mining, wholesale and 2 Includes all financial company paper sold by dealers in the open retail trade, transportation, and services, market. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A26 Domestic Nonfinancial Statistics • January 1977 1.34 PRIME RATE CHARGED BY BANKS on Short-term Business Loans Per cent per annum Effective Effective date date 10 1975—Jan. 9 10% 1975-—July 18. 7% 1975—July. 10% 15, 10 28 7Vi Aug. 101/2 20 9% Sept. 28 9Vi Aug. 12 7% Oct. 10% Nov. 1 1in 1 1/ *42 Feb. 1 1 3 0 8 9 9 8 % % S O e c p t t . . 2 1 7 5 7% 1976— D Ja e n c . . . 24 8% Feb.. Nov. 5 71/2 Mar. Mar. 5 8% Apr. 12 1 1 0 8 7 8 % Dec. 2 7% J M u a n y e 11% 24 7711//22 1976-—Jan. 12 7 July. IIVI 21 6% Aug. 11% May 20 7% Sept. June 1 7 Oct.. 11 June 9 7 7 7% Nov. 10% Dec. 10% Aug. 2 1.35 INTEREST RATES CHARGED BY BANKS on Business Loans Per cent per annum Size of loan (in thousands of dollars) All sizes Center 1-9 10-99 100-499 500-999 1,000 and over Nov. Aug. Nov. Aug. Nov. Aug. Nov. Aug. Nov. Aug. Nov. Aug. 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 Short-term rates 1 35 centers 7.28 7.80 8.. 83 9.06 8.18 8.58 7.66 7.99 7.31 7.84 7.02 7.61 2 New York City 6.88 7.48 8.. 56 8.85 7.94 8.40 7.43 7.91 7.24 7.77 6.74 7.36 3 7 Other Northeast 7.62 8.18 9.. 22 9.41 8.34 8.84 7.88 8.25 7.49 8.16 7.34 7.98 4 8 North Central 7.28 7.70 8.. 45 8.65 8.12 8.50 7.69 7.85 7.36 7.71 7.03 7.55 5 7 Southeast 7.51 7.95 9.. 13 9.33 8.48 8.76 7.71 8.00 7.04 7.85 7.07 7.54 6 8 Southwest 7.33 7.75 8.. 51 8.83 7.82 8.24 7.39 7.80 7.21 7.61 7.12 7.55 7 4 West Coast 7.52 8.15 8.. 69 9.26 8.46 8.79 7.88 8.28 7.44 8.06 7.34 8.05 Revolving credit rates 8 35 centers 7.19 7.87 8.37 8.70 8.14 8.33 7.60 8.02 7.41 7.80 7.12 7.88 9 New York City... 7.18 8.14 7.23 7.25 7.86 8.26 7.21 7.70 6.97 7.56 7.19 8.19 10 7 Other Northeast 6.92 7.59 8.15 8.00 8.20 8.22 7.26 7.67 7.75 8.36 6.75 7.47 11 8 North Central. . 7.54 7.96 8.52 8.94 8.95 9.03 8.05 8.50 7.88 7.74 7.39 7.90 12 7 Southeast 7.05 7.48 8.31 8.75 8.09 8.40 7.56 8.16 6.77 6.83 7.13 13 8 Southwest 7.45 7.81 8.19 8.74 7.96 8.09 7.74 8.20 7.24 7.47 7.39 7.80 14 4 West Coast 7.11 7.73 8.77 9.10 7.85 8.08 7.58 7.95 7.45 7.91 7.01 7.68 Long-term rates 15 35 centers 7.48 8.45 9.39 9.61 8.88 9.02 8.14 8.55 8.13 8.60 7.24 8.40 16 New York City.. . 7.36 8.52 7.19 8.55 8.27 7.93 8.05 8.06 8.44 7.26 8.56 17 7 Other Northeast 6.64 8.62 9.22 9.40 8.84 9.43 7.95 8.93 7.92 7.50 5.73 8.70 18 8 North Central. . 7.66 8.05 9.20 8.83 9.03 9.07 8.35 8.26 8.99 8.36 7.32 7.92 19 7 Southeast 7.59 8.88 9.87 9.60 9.35 9.08 7.93 9.88 4.00 8.18 7.79 8.06 20 8 Southwest 7.73 8.42 10.54 10.85 9.05 9.04 8.28 8.23 8.44 8.69 7.20 8.30 21 4 West Coast 8.04 8.67 8.70 9.28 8.54 8.58 8.31 8.81 7.78 10.00 8.03 8.46 NOTE.—Weighted average rates based on sample of loans made during first 7 days of the survey month. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Markets All 1.36 INTEREST RATES in Money and Capital Markets Averages, per cent per annum 1976 1976, week ending— IInnssttrruummeenntt 1974 1975 1976 Sept. | Oct. Nov. Dec. Dec. 4 Dec. 11 Dec. 18 Dec. 24 Dec. 31 Money market rates Prime commercial paper:1 ] 90-119 day 10.05 6.26 5.24 5.33 5.10 4.98 4.66 4.75 4.63 4.70 4.63 4.63 2 4- to 6-month 9.87 6.33 5.35 5.45 5.22 5.05 4.70 4.83 4.70 3.75 4.63 4.65 3 Finance company paper, directly placed, 3- to 6-month2 8.62 6.16 5.22 5.31 5.08 4.92 4.56 4.73 4.58 4.55 4.53 4.50 4 Prime bankers acceptances, 90-day3 9.92 6.30 5.19 5.28 5.06 4.90 4.62 4.64 4.64 4.60 4.60 4.65 5 Federal funds4 10.51 5.82 5.05 5.25 5.03 4.95 4.65 4.78 4.67 4.68 4.63 4.66 Large negotiable certificates of deposit:... 6 3-month, secondary market5 10.27 6.43 5.26 5.32 5.13 5.00 4.67 4.71 4.70 4.68 4.61 4.65 7 5 ,15 5.25 5.03 4.95 4.54 4.50 4.60 4.60 4.50 4.50 8 Euro-dollar deposits, 3-month? 10.96 6.97 5.57 5.55 5.47 5.29 5.01 5.18 4.95 4.95 5.01 5.09 U.S. Government securities:8 Bills: Market yields: 9 3-month 7.84 5.80 4.98 5.08 4.92 4.75 4.35 4.42 4.41 4.33 4.27 4.34 10 6-month 7.95 6.11 5.26 5.30 5.06 4.88 4.51 4.55 4.52 4.53 4.47 4.51 11 1-year 7.71 6.30 5.52 5.50 5.19 5.00 4.64 4.66 3.66 4.66 4.60 4.62 Rate on new issue: 12 3-month 7.886 5.838 4.989 5.075 4.930 4.810 4.354 4.466 4.383 4.360 4.269 4.296 13 6-month 7.926 6.122 5.266 5.311 5.073 4.944 4.513 4.567 4.516 4.508 4.500 4.474 Notes and bonds maturing in— 14 9 to 12 months 8.25 6.70 5.84 5.79 5.49 5.29 4.92 4.98 4.94 4.94 4.88 4.88 15 3 to 5 years 7.81 7.55 6.94 6.84 6.50 6.35 5.96 5.92 5.94 5.99 5.96 5.98 Capital market rates Government bonds: U.S. Treasury:9 16 Long-term 6.99 6.98 6.78 6.70 6.65 6.62 6.39 6.43 6.37 6.41 6.40 6.37 17 20-year constant maturity 8.05 8.19 7.86 7.78 7.70 7.64 7.30 7.39 7.32 7.34 7.28 7.25 State and local: Moody's series: 18 Aaa 5.89 6.42 5.66 5.40 5.29 5.27 5.07 5.10 5.07 5.07 5.07 5.04 19 Baa 6.53 7.62 7.49 6.51 6.30 6.29 6.73 6.03 5.96 5.95 6.70 6.58 20 Bond Buyer series,11 6.17 7.05 6.64 6.51 6.30 6.29 5.94 6.03 5.96 5.95 5.93 5.83 Corporate bonds: Seasoned issues (Moody's series)12 21 All industries 9.03 9.57 9.01 8.79 8.71 8.66 8.47 8.55 8.51 8.47 8.45 8.40 By rating groups: 22 Aaa 8.57 8.83 8.43 8.38 8.32 8.25 7.98 8.09 88..0011 8.00 7.96 77..9911 23 Aa 8.84 9.17 8.75 8.54 8.48 8.46 8.24 8.35 8.29 8.24 8.22 8.17 24 A 9.20 9.65 9.09 8.81 8.73 8.69 8.53 8.62 8.56 8.54 8.50 8.45 25 Baa 9.50 10.61 9.75 9.40 9.29 9.23 9.12 9.19 9.16 9.11 9.10 9.09 Aaa utility bonds:13 26 New issue 9.33 9.40 8.48 8.29 8.25 8.17 7.94 7.95 7.93 7.96 27 Recently offered issues 9.34 9.41 8.49 8.33 8.24 8.18 7.93 7.97 7.94 7.97 7.92 7.84 1 Averages of the most representative daily offering rate quoted by 8 Except for new bill issues, yields are computed from daily closing dealers. bid prices. Yields for all bills are quoted on a bank-discount rate basis. 2 Averages of the most representative daily offering rates published by Yields for notes and bonds are unweighted averages for all outstanding finance companies for varying maturities in this range. issues in maturity ranges shown. 3 Beginning Aug. 15, 1974, the rate is the average of the midpoint of 9 Yields are computed from daily closing bid prices. Long-term yield is the range of daily dealer closing rates offered for domestic issues; prior unweighted average for all bonds neither due nor callable in less than 10 data are averages of the most representative daily offering rate quoted by years; 20-year constant maturity represents yield on the more actively dealers. traded issues adjusted to a 20-year maturity by the U.S. Treasury. 4 Weekly figures are 7-day averages of daily effective rates for the week 10 General obligations only, based on figures for Thursday, from ending Wednesday; the daily effective rate is an average of the rates on Moody's Investors Service. a given day weighted by the volume of transactions at these rates. 11 Twenty issues of mixed quality. 5 Averages of the daily midpoints as determined from the range of 12 Averages of daily figures from Moody's Investors Service. offering rates in the secondary market. 13 Compilation of the Board of Governors of the Federal Reserve 6 Posted rates, which are the annual interest rates most often quoted System. on new offerings of negotiable CD's in denominations of $100,000 or Issues included are long-term (20 years or more). New-issue yields are more. Rates prior to 1976 not available. Weekly figures are for Wednes- based on quotations on date of offering; those on recently offered issues day dates. (included only for first 4 weeks after termination of underwriter price 7 Averages of daily quotations for the week ending Wednesday. restrictions), on Friday close-of-business quotations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic Financial Statistics • January 1977 1.37 STOCK MARKET Selected Statistics 1976 Indicator 1974 1975 1976 June July Aug. Sept. Oct. Nov. Dec. Prices and trading (averages of daily figures) Common stock prices: New York Stock Exchange (Dec. 31, 1965 = 50): 1 Total 43.84 45.73 54.45 54.23 55.70 55.06 56.30 54.43 54.17 56.34 2 Industrial 48.08 51.88 60.44 60.70 62.10 61.09 62.34 60.07 59.45 61.54 3 Transportation 31.89 30.73 39.57 40.41 42.12 40.63 40.36 38.37 39.28 41.77 4 Utility 29.82 31.45 36.97 35.16 36.49 37.56 38.77 38.33 38.85 40.61 5 Finance 49.67 46.62 52.94 51.82 54.06 54.22 54.51 52.74 53.25 57.45 Standard and Poor's Corporation (1941-43 = 10): 6 Total i 82.85 85.17 102.01 101.78 104.20 103.29 105.45 101.89 101.19 104.66 American Stock Exchange (Aug. 31, 1973 = 100): 7 Total 79.97 83.15 101.63 103.57 105.24 102.79 102.92 98.99 99.20 104.06 Volume of trading (thousands of shares):2 8 New York Stock Exchange 13,883 18,568 21,189 18,965 18,977 15,758 18,892 17,397 19,370 23,621 9 American Stock Exchange 1,908 2,150 2,565 2,177 2,280 1,605 1,902 1,700 2,211 3,095 Customer financing (end-of-period balances, in millions of dollars) 10 Regulated margin credit at brokers/dealers and banks3 4,836 6,500 8,276 8,417 8,683 8,566 8,772 8,629 11 Brokers, total 3,980 5,540 7,248 7,519 7,622 707 7,704 7,790 12 Margin stock4 3,840 5,390 7,080 7,340 7,450 7,530 7,530 7,610 13 Convertible bonds 137 147 166 176 167 174 168 178 14 Subscription issues 3 3 2 3 5 3 6 2 15 Banks, total 856 960 1,028 898 1,061 859 1,068 839 16 Margin stocks 815 909 976 854 1,008 813 1,019 790 17 Convertible bonds 30 36 33 28 34 32 34 35 18 Subscription issues 11 15 19 16 19 14 15 14 19 Unregulated nonmargin stock credit at banks5 2,064 2,281 2,368 2,317 2,368 2,830 2,774 3,351 MEMO: Free credit balances at brokers6 20 Margin-account 410 475 540 530 555 555 611 615 21 Cash-account 1,425 1,525 1,680 1,635 1,605 1,710 1,580 1,740 Margin-account debt at brokers (percentage distribution, end of period) 22 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 By equity class:7 23 Under 40 per cent.. 45.4 25.0 14.1 14.0 18.2 12.2 15.0 14.0 24 40-49 23.0 28.8 25.4 31.1 33.9 29.9 34.0 32.0 25 50-59 13.9 22.3 32.2 27.7 22.7 29.6 25.6 27.0 26 60-69 8.8 11.6 14.4 13.0 12.7 14.1 12.7 13.0 27 70-79 4.6 6.9 7.7 8.0 6.9 8.0 7.2 8.0 29 80 per cent or more 4.3 5.3 6.3 6.1 5.7 6.3 5.7 6.0 Margin requirements 8 (per cent of market value) effective— Mar. 11, 1968 June 8, 1968 May 6, 1970 Dec. 6, 1971 Mar. 24, 1972 Jan. 3, 1974 29 Margin stocks .70 .80 .65 .55 .65 .50 30 Convertible bonds .50 .60 .50 .50 .50 .50 31 Short sales .70 .80 .65 .55 .65 .50 1 Effective July 1976 includes a new financial group, banks and in- counter margin stocks. At banks, loans to purchase or carry nonmargin surance companies. With this change the index includes 400 industrial stocks are unregulated; at brokers, such stocks have no loan value. stocks (formerly 425), 20 transportation (formerly 15 rail), 40 public 6 Free credit balances are in accounts with no unfulfilled commitments utility (formerly 60), and 40 financial. to the brokers and are subject to withdrawal by customers on demand. 2 Based on trading for a 5Vi-hour day. 7 Each customer's equity in his collateral (market value of collateral 3 Margin credit includes all credit extended to purchase or carry less net debit balance) is expressed as a percentage of current collateral stocks or related equity instruments and secured at least in part by stock. values. Credit extended by brokers is end-of-month data for member firms of 8 Regulations G, T, and U, prescribed in accordance with the Securities the New York Stock Exchange; June data for banks are universe totals; Exchange Act of 1934, limit the amount of credit to purchase and carry all other data for banks are estimates for all commercial banks based on margin stocks that may be extended on securities as collateral by predata from a sample of reporting banks. scribing a maximum loan value, which is a specified percentage of the In addition to assigning a current loan value to margin stock generally, market value of the collateral at the time the credit is extended. Margin Regulations T and U permit special loan values for convertible bonds requirements are the difference between the market value (100 per cent) and stock acquired through exercise of subscription rights. and the maximum loan value. The term "margin stocks" is defined in 4 A distribution of this total by equity class is shown below. the corresponding regulation. 5 Nonmargin stocks are those not listed on a national securities ex- Regulation G and special margin requirements for bonds convertible change and not included on the Federal Reserve System's list of over-the- 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

Thrift Institutions A29 1.38 SAVINGS INSTITUTIONS Selected Assets and Liabilities Millions of dollars, end of period 1976 1973 1974 1975 Account Mar. Apr. May June July Aug. Sept. j Oct. Nov. Savings and loan associations 1 Assets 271,905 295,524 338,395 353,740 357,827 363,032 366,598 371,956 376,364 379,925 385,192 389,335 2 Mortgages 231,733 249,293 278,693 286,556 290,727 294,759 299,574 303,815 308,049 312,139 316,034 319,579 3 Cash and investment securities1 21,055 23,240 30,900 36,722 36,437 37,005 35,316 36,029 35,873 35,262 36,499 36,658 4 Other 19,117 22,991 28,802 30,462 30,663 31,268 31,708 32,112 32,442 32,524 32,659 33,098 5 Liabilities and net worth 271,905 295,524 338,395 353,740 357,827 363,032 366,598 371,956 376,364 379,925 385,192 389,335 6 Savings capital 226,968 242,959 286,043 302,436 305,234 308,284 313,326 316,510 318,675 324,272 327,739 330,319 7 Borrowed money 17,172 24,780 20,709 18,220 17,759 17,670 18,251 18,439 18,935 19,161 18,888 18,784 8 FHLBB 14,951 21,508 17,524 15,461 15,031 14,898 15,016 15,139 15,495 15,832 15,636 15,560 9 Other 2,221 3,272 3,185 2,759 2,728 2,772 3,235 3,300 3,440 3,329 3,252 3,224 10 Loans in process 4,667 3,244 5,187 5,379 5,787 6,156 6,464 6,640 6,697 6,756 6,805 6,820 11 Other 6,042 6,105 6,680 7,494 8,572 10,234 7,796 9,370 10,791 8,352 10,089 11,475 12 Net worth2 17,056 18,436 19,776 20,211 20,475 20,688 20,761 20,997 21,266 21,384 21,671 21,937 13 MEMO: Mortgage loan commitments outstanding3 9,526 7,454 10,675 14,445 15,512 16,620 16,639 16,328 15,796 15,470 15,338 15,230 Mutual savings banks 14 Assets 106,651 109,550 121,056 125,526 126,470 127,470 128,436 129,826 130,571 131,413 132,455 Loans: 15 Mortgage 73,231 74,891 77,221 77,738 78,046 78,286 78,803 79,398 79,781 80,145 80,543 16 Other 3,871 3,812 4,023 5,366 5,027 5,103 5,137 5,341 5,210 5,478 5,549 Securities: 17 U.S. Government 2,957 2,555 4,740 5,452 5,533 5,660 5,635 5,640 5,733 5,851 5,796 18 State and local government. 926 930 1,545 1,867 2,149 2,318 2,337 2,376 2,339 2,359 2,429 19 Corporate and other4 21,383 22,550 27,992 30,043 30,707 31,179 31,493 32,028 32,319 32,432 32,793 20 Cash 1,968 2,167 2,330 1,740 1,647 1,539 1,558 1,538 1,552 1,581 1,695 21 Other assets 2,314 2,645 3,205 3,321 3,361 3,385 3,470 3,505 3,576 3,567 3,649 22 Liabilities 176,651 109,550 121,056 125,526 126,470 127,470 128,436 129,826 130,571 131,413 132,455 23 Deposits 96,496 98,701 109,873 114,090 114,752 115,521 116,876 117,883 118,225 119,590 120,360 24 Regular: 5 96,056 98,221 109,291 113,374 113,960 114,761 115,985 116,895 117,203 118,510 119,346 25 Ordinary savings 65,221 64,286 69,653 71,860 71,801 72,156 72,763 73,223 72,872 73,484 73,610 26 Time and other 30,835 33,935 39,639 41,514 42,159 42,605 43,223 43,662 44,331 45,027 45,736 27 Other 440 480 582 716 792 760 890 988 1,022 1,080 1,014 28 Other liabilities 2,566 2,888 2,755 2,859 3,106 3,296 2,841 3,161 3,490 2,898 3,140 29 General reserve accounts... . 7,589 7,961 8,428 8,577 8,612 8,654 8,719 8,781 8,855 8,925 8,955 30 MEMO: Mortgage loan commitments outstanding6 3,261 2,040 1,803 2,130 2,290 2,426 2,402 2,433 2,459 2,671 2,548 Life insurance companies 31 Assets 254,436 263,349 289,304 298,625 299,983 301,754 304,728 307,005 309,295 312,044 313,960 Securities: 32 Government 19,519 10,900 13,758 15,701 15,917 15,975 15,947 16,672 16,902 16,862 17,329 33 United States7 3,444 3,372 4,736 5,093 5,198 5,141 4,863 5,150 5,922 5,150 5,448 34 State and local, 3,412 3,667 4,508 5,016 5,100 5,146 5,196 5,263 5,324 5,364 5,446 35 Foreign 8 3,663 3,861 4,514 5,592 5,619 5,688 5,888 6,259 6,286 6,348 6,435 36 Business 118,599 119,637 135,317 142,310 143,197 114,496 147,193 148,617 150,303 152,125 153,298 37 Bonds 92,680 97,717 107,256 110,816 111,757 113,087 114,583 116,101 117,806 118,706 120,358 38 Stocks 25,919 21,920 28,061 31,494 31,440 31,409 32,610 32,516 32,497 33,419 32,940 39 Mortgages 81,369 86,234 89,167 89,474 89,489 89,529 89,691 89,753 89,891 90,217 90,323 40 Real estate 7,693 8,331 9,621 9,798 9,852 9,909 10,004 10,050 10,146 10,175 10,285 41 Policy loans 20,199 22,862 24,467 24,754 24,873 24,978 25,142 25,257 25,383 25,505 25,607 42 Other assets 14,057 15,385 16,971 16,588 16,655 16,867 16,751 16,656 16,670 17,160 17,118 1 Stock of the Federal Home Loan Bank Board is included in "other NOTE.—Savings and loan associations: Estimates by the FHLBB for assets." all associations in the United States. Data are based on monthly reports 2 Includes net undistributed income, which is accrued by most, but not of Federally insured associations and annual reports of other associations. all, associations. Even when revised, data for current and preceding year are subject to 3 Excludes figures for loans in process, which are shown as a liability. further revision. 4 Includes securities of foreign governments and international organiza- Mutual savings banks: Estimates of National Association of Mutual tions and nonguaranteed issues of U.S. Govt, agencies. Savings Banks for all savings banks in the United States. Data are re- 5 Excludes checking, club, and school accounts. ported on a gross-of-valuation-reserves basis. 6 Commitments outstanding (including loans in process) of banks in Life insurance companies: Estimates of the Institute of Life Insurance New York State as reported to the Savings Banks Assn. of the State of for all life insurance companies in the United States. Annual figures are New York. annual-statement asset values, with bonds carried on an amortized basis 7 Direct and guaranteed obligations. Excludes Federal agency issues and stocks at year-end market value. Adjustments for interest due and not guaranteed, which are shown in this table under "business securities." accrued and for differences between market and book values are not 8 Issues of foreign governments and their subdivisions and bonds of the made on each item separately but are included, in total, in "other assets." International Bank for Reconstruction and Development. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 Domestic NonfinancialS tatistics • January 1977 1.39 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Fiscal year Calendar year Transition quarter Type of account or operation (July- 1975 1976 1975 1976 Sept. 1976) H2 HI Sept. Oct. Nov. U.S. Budget: 1 Receipts 281,037 300,005 81,773 141,430 139,453 160,552 31,753 21,018 25,698 2 Outlays 324,642 365,610 94,473 171,494 184,545 181,066 30,996 34,000 33,083 3 Surplus, or deficit (—) -43,604 -65,605 -12,700 -30,065 -45,092 -20,513 757 -12,981 -7,385 4 Trust funds 7,408 2,378 -288 2,558 -3,126 5,503 -2,204 -4,734 328 5 Federal funds1 -51,012 -67,983 -12,412 -32,623 -41,966 -26,013 2,961 -8,247 -7,713 6 Off-Budget agencies, surplus, or deficit (-):2 -3,155 -2,101 570 -4,711 -774 -1,327 550 3,273 -305 7 Federal Financing Bank, net outlays. -6,389 -5,915 -2,575 -3,365 -2,693 -3,222 -334 -702 -301 U.S. Budget plus off-budget, including Federal Financing Bank 8 Surplus, or deficit (—) -53,149 -73,621 -14,705 -38,140 -48,559 -25,063 972 -10,411 -7,991 Financed by— 9 Borrowing from the public 50,867 82,813 17,977 36,116 49,347 33,466 3,279 4,386 6,738 10 Cash and monetary assets (decrease, or increase (—)) -320 -7,796 -2,899 -2,991 113 -7,909 -5,954 5,371 3,391 11 Other 3 2,602 -1,396 -373 5,015 -901 -495 1,702 654 -2,138 12 Treasury operating balance (level, end of period) 7,591 14,836 17,418 7,591 8,452 14,836 17,418 12,038 8,657 13 F.R.Banks 5,773 11,975 13,299 5,773 7,286 11,975 13,299 10,239 6,766 14 Tax and loan accounts 1,475 2,854 4,119 1,475 1,159 2,854 4,119 1,799 1,891 15 Other demand accounts4 343 7 343 7 7 1 Calculated as a residual of total surplus/deficit and trust fund surplus/ cash and monetary assets; seignorage; increment on gold; net gain/loss deficit. for U.S. currency valuation adjustment beginning June 1975; conversion 2 Includes Export-Import Bank (before October 1976), Pension Benefit of interest receipts of Government accounts to an accrual basis. Guaranty Corp., Postal Service, Rural Electrification and Telephone 4 Excludes the gold balance but includes deposits in certain commercial Revolving Fund, Rural Telephone Bank, and Housing for the Elderly or depositories that have been converted from a time deposit to a demand Handicapped Fund. deposit basis to permit greater flexibility in Treasury cash management. 3 Includes: Public debt accrued interest payable to the public; deposit funds; miscellaneous liability (including checks outstanding) and asset SOURCE.—Monthly "Treasury Statement of Receipts and Outlays of accounts; Special Drawing Rights; gold tranche drawing rights; other the U.S. Government" and Treasury Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A31 1.40 U.S. BUDGET RECEIPTS AND OUTLAYS Millions of dollars Fiscal year Calendar year Transition quarter Source or type (July- 1975 1976 11997755 11997766 Sept. 1976)6 HI H2 HI Sept. Oct. Nov. Receipts 1 AH sources 280,997 300,005 81,773 141,190 139,453 160,552 31,753 21,018 25,698 2 Individual income taxes, net 122,386 131,603 38,801 54,926 65,835 65,767 15,513 11,095 12,535 3 Withheld 122,071 123,408 32,949 60,694 59,549 63,859 10,406 10,694 12,201 4 Presi F d u en n t d ia l Election Campaign 32 34 j 33 5 Nonwithheld 34,296 35,528 6,809 27,198 7,649 27,879 5,249 564 375 6 Refunds 34,013 27,367 958 32,997 1,362 26,004 142 163 41 7 Corporation income taxes 8 Gross receipts 45,747 46,783 9,809 27,500 18,810 27,973 6,812 1,874 1,185 9 Refunds 5,125 5,374 1,348 3,109 2,735 2,639 554 846 486 10 Social insurance taxes and contributions, net 86,441 92,714 25,759 46,667 40,886 51,828 7,077 6,199 9,432 11 Payroll employment taxes and contributions 1 71,789 76,391 21,534 37,371 35,443 40,947 6,269 5,308 1,115 12 Self-employment taxes and contributions 1 33,,441177 33,,551188 269 33,,116633 268 33,,225500 269 13 Unemployment insurance 66,,777700 88,,005544 2,698 33,,885566 2,861 55,,119933 153 503 1,205 14 Other net receipts 2 44,,446666 AA,,115522 1,258 22,,227799 2,314 22,,443388 386 388 451 15 Excise taxes 16,551 16,963 4,473 7,790 8,759 8,204 1,486 1,408 1,517 16 Customs 3,676 4,074 1,212 1,718 1,927 2,147 429 417 570 17 Estate and gift 4,611 5,216 1,455 2,327 2,573 2,643 453 345 392 18 Miscellaneous receipts 3 6,711 8,026 1,613 3,370 3,397 4,630 537 527 553 Outlays 19 All types 324,642 365,610 94,473 171,494 184,545 181,066 30,996 34,000 33,083 20 National defense 86,533 90,216 22,389 43,979 46,164 44,052 7,659 7,604 7,434 21 International affairs 4,356 4,462 1,450 2,592 2,097 2,365 152 539 294 22 General science, space, and technology 4,048 4,197 1,129 2,047 2,489 1,708 309 431 400 23 Natural resources, environment, and energy 9,567 11,674 3,592 5,584 A,115 6,900 1,173 1,057 1,341 24 Agriculture 1,667 1,994 760 1,074 1,577 417 531 122 630 25 Commerce and transportation 16,010 17,239 4,685 7,020 11,472 5,766 1,977 2,237 1,726 26 Community and regional development 4,431 5,023 1,505 2,192 2,612 2,411 525 425 756 27 Education, training, employment, and social services 15,249 17,678 4,683 8,980 8,563 9,116 1,862 1,128 1,709 28 Health 27,647 33,601 8,992 14,626 16,593 17,008 2,843 3,251 3,014 29 Income security 108,605 126,896 32,838 59,543 61,560 65,336 10,955 11,070 11,016 30 Veterans benefits and services.... 16,594 18,444 3,975 8,764 8,994 9,450 1,223 1,401 1,699 31 Law enforcement and justice 2,942 3,325 860 1,698 1,542 1,784 300 258 300 32 General government 3,087 2,951 854 1,204 2,082 870 312 160 395 33 Revenue sharing and general purpose fiscal assistance 7,006 7,114 2,024 3,389 3,450 3,664 137 2,112 590 34 Interest4 30,975 35,500 7,304 15,673 16,940 18,560 1,256 2,642 2,438 35 Undistributed offsetting receipts4,5 -14,075 -14,704 -2,567 -6,871 -6,365 -8,340 -217 -436 -659 1 Old-age, disability and hospital insurance, and Railroad Retirement 5 Consists of interest received by trust funds, rents and royalties on accounts. the Outer Continental Shelf, and Federal Govt, contributions for em- 2 Supplementary medical insurance premiums and Federal employee ployee retirement. retirement contributions. 6 Effective in calendar year 1976, the fiscal year for the U.S. Govt, 3 Deposits of earnings by F.R. Banks and other miscellaneous receipts. changed from July 1-June 30 to October 1-September 30. The period 4 Effective September 1976, "Interest" and "Undistributed Offsetting July 1-September 30 of 1976, data for which are shown separately from Receipts" reflect the accounting conversion for the interest on special fiscal year 1976 and fiscal year 1977 totals, is a transition quarter. issues for Govt, accounts from an accrual basis to a cash basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 Domestic Nonfinancial Statistics • January 1977 1.41 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars 1973 1974 1975 1976 IItteemm June 30 Dec. 31 June 30 Dec. 31 June 30 Dec. 31 Mar. 31 June 30 Sept. 30 1 Federal debt outstanding 468.4 480.7 486. 2 504.0 544.1 587.6 611.4 631.3 645.8 457.3 469.1 474. ,2 492.7 533.7 576.6 600.5 620.4 634.7 3 Held by public 333.9 339.4 336. 0 351.5 387.9 437.3 461.4 470.8 488.6 4 Held by agencies 123.4 129.6 138. 2 141.2 145.3 139.3 139.1 149.6 146.1 5 Agency securities 11.1 11.6 12,. 0 11.3 10.9 10.9 10.9 11.9 11.0 6 Held by public 9.1 9.6 10. 0 9.3 9.0 8.9 8.9 8.9 9.1 7 Held by agencies 2.0 2.0 2. 0 2.0 1.9 2.0 2.0 2.0 1.9 8 Debt subject to statutory limit 459.1 470.8 476. 0 493.0 534.2 577.8 601.6 621.6 635.8 9 Public debt securities 456.7 468.4 473. 6 490.5 532.6 576.0 599.9 619.8 634.1 10 Other debt* 2.4 2.4 2.. 4 2.4 1.6 1.7 1.7 1.7 1.7 11 MEMO: Statutory debt limit. 465.0 475.7 495,. 0 495.0 577.0 595.0 627.0 636.0 636.0 i Includes guaranteed debt of Government agencies, specified partici- SOURCE: U.S. Treasury Bulletin. pation certificates, notes to international lending organizations, and District of Columbia stadium bonds. 1.42 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1976 Type and holder 1973 1974 1975 July Aug. Sept. Oct. Nov. Dec. 1 Total gross public debt1 469.9 492.7 576.6 624.5 633.3 634.7 637.6 644.6 653.5 By type: 2 Interest-bearing debt 360.7 373.4 457.1 495.5 502.5 505.7 508.7 517.0 523.5 3 Marketable 270.2 282.9 363.2 397.7 404.3 407.7 408.6 415.4 421.3 4 Bills 107.8 119.7 157.5 161.4 161.4 161.5 161.5 161.7 164.0 5 Notes 124.6 129.8 167. 1 197.2 203.0 206.3 207.3 213.0 216.7 6 Bonds 37.8 33.4 38.6 39.1 39.9 39.8 39.8 40.7 40.6 7 8 No C n o m n a v r e k r e t t i a b b l l e e 2 b onds3 19 2 7. . 6 3 208 2 . . 7 3 212 2 . . 5 3 22 2 5. . 9 3 228 2 .0 .3 225 2 . . 9 3 226 2 . . 5 3 22'82.2.3 231 2 . . 2 3 9 Foreign issues4 26.0 22.8 21.6 21.4 21.0 20.8 22.3 22.5 22.3 10 Savings bonds and notes 60.8 63.8 67.9 70.8 71.5 71.2 71.5 71.9 72.3 11 Government account series5 108.0 119.1 119.4 128.9 130.6 128.6 127.2 127.4 129.7 By holder:6 12 U.S. Government agencies and trust funds 129.6 141.2 139.3 147.6 148.0 146.1 144.6 13 Federal Reserve Banks 78.5 80.5 87.9 90.7 94.0 96.4 95.7 14 Private investors 261.7 271.0 349.4 386.2 391.3 392.2 397.3 15 Commercial banks 60.3 55.6 85.1 94.0 92.5 93.3 94.8 16 Mutual savings banks 2.9 2.5 4.5 5.3 5.4 5.3 5.3 1 1 7 8 I O n t s h u e r r a n co ce r p c o o r m at p io a n n s ie s 1 6 0 . . 4 9 161.. 01 2 9 0 . . 3 2 27! 0 2 1 7 1 . . 8 6 2 1 5 1 . . 7 6 2 1 4 2 . . 7 1 19 State and local governments 29.2 29.2 33.8 37.2 38.7 39.1 41.5 Individuals: 20 Savings bonds 60.3 63.4 67.3 70.3 70.9 70.9 71.3 21 Other securities 16.9 21.5 24.0 26.8 28.8 28.8 28.8 22 Foreign and international7 55.5 58.4 66.5 72.8 74.6 74.6 75.2 23 Other miscellaneous investors8 19.3 23.2 38.6 41.9 40.9 42.9 42.6 1 Includes $1.1 billion of non-interest-bearing debt (of which $612 6 Data for F.R. Banks and U.S. Govt, agencies and trust funds are million on Dec. 31, 1976, was not subject to statutory debt limitations). actual holdings; data for other groups are Treasury estimates. 2 Includes (not shown separately): Securities issued to the Rural 7 Consists of the investments of foreign balances and international Electrification Administration and to State and local governments, de- accounts in the United States. Beginning with 1974, the figures exclude positary bonds, retirement plan bonds, and individual retirement bonds. non-interest-bearing notes issued to the International Monetary Fund. 3 These nonmarketable bonds, also known as Investment Series B 8 Includes savings and loan associations, nonprofit institutions, cor- Bonds, may be exchanged (or converted) at the owner's option for 1V2 porate pension trust funds, dealers and brokers, certain Government per cent, 5-year marketable Treasury notes. Convertible bonds, which deposit accounts, and Government-sponsored agencies. have been so exchanged, are removed from this category and recorded in the notes category above. NOTE.—Gross public debt excludes guaranteed agency securities and, 4 Nonmarketable certificates of indebtedness, notes, and bonds in the beginning in July 1974, includes Federal Financing Bank security issues. Treasury foreign series and foreign-currency series. SOURCE: For data by type of security, Monthly Statement of the Public 5 Held only by U.S. Government agencies and trust funds. Debt of the United States, U.S. Treasury Department; for data by holder, Treasury Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A33 1.43 U.S. GOVERNMENT MARKETABLE SECURITIES Ownership, by maturity Par value; millions of dollars; end of period 1976 1976 1975 1975 Type of holder Sept. Oct. Nov. Sept. Oct. Nov. All maturities 1 to 5 years 1 All holders 363,191 407,663 408,590 415,399 112,270 131,102 127,938 137,932 2 U.S. Govt, agencies and trust funds 19,347 16,640 16,640 16,429 7,058 5,726 5,850 6,213 3 Federal Reserve Banks 87,934 96,427 95,738 91,660 30,518 30,531 30,293 3,036 4 Private investors 255,860 294,596 296,212 307,310 74,694 94,845 91,795 101,683 5 Commercial banks 64,398 70,201 71,077 74,013 29,629 36,740 35,660 38,254 6 Mutual savings banks 3,300 3,975 3,954 3,956 1,524 2,097 2,009 2,083 7 Insurance companies 7,565 9,654 10,111 10,194 2,359 3,744 3,680 3,768 8 Nonfinancial corporations 9,365 14,102 13,547 13,062 1,967 3,578 2,477 2,873 9 Savings and loan associations 2,793 4,439 4,375 4,462 1,558 2,283 2,102 2,320 10 State and local governments 9,285 11,467 12,427 12,543 1,761 2,252 2,373 2,546 11 All others 159,154 180,759 180,720 189,080 35,894 44,151 43,493 49,840 Within 1 year 5 to 10 years 12 All holders 199,692 206,062 207,679 208,271 26,436 44,029 46,562 43,060 13 U.S. Govt, agencies and trust funds 2,769 2,298 2,200 1,929 3,283 2,540 2,565 2,835 14 Federal Reserve Banks 46,845 50,462 50,301 47,920 6,463 10,242 10,075 8,876 15 Private investors 150,078 153,302 155,178 158,422 16,690 31,247 33,922 31,349 16 Commercial banks 29,875 26,524 27,406 28,629 4,071 6,151 7,228 6,301 17 Mutual savings banks 983 1,026 1,065 1,087 448 600 647 516 18 Insurance companies 2,024 1,899 2,221 2,348 1,592 2,333 2,546 2,427 19 Nonfinancial corporations 7,105 10,115 10,514 9,738 175 316 395 295 20 Savings and loan associations 914 1,895 1,978 1,926 216 174 214 139 21 State and local governments 5,288 6,604 6,764 7,072 782 1,162 1,581 1,380 22 All others 103,889 105,239 105,231 107,621 9,405 20,511 21,311 20/291 Bills, within 1 year 10 to 20 years 23 All holders 157,483 161,505 161,545 161,711 14,264 13,221 13,176 11,915 24 U.S. Govt, agencies and trust funds 207 544 449 375 4,233 3,676 3,676 3,102 25 Federal Reserve Banks 38,018 41,364 41,237 37,992 1,507 1,606 1,603 1,303 26 Private investors 119,258 119,597 119,859 123,344 8,524 7,939 7,897 7,510 27 Commercial banks 17,481 14,413 14,310 15,202 552 451 490 406 28 Mutual savings banks 554 368 373 355 232 184 178 155 29 Insurance companies 1,513 1,263 1,525 1,621 1,154 1,117 1,127 1,122 30 Nonfinancial corporations 5,829 8,731 9,215 8,712 61 60 130 120 31 Savings and loan associations.... 518 1,280 1,319 1,257 82 69 68 65 32 State and local governments 4,566 5,452 5,571 6,022 896 760 909 723 33 All others 88,797 88,090 87,547 90,175 5,546 5,299 4,994 4,919 Other, within 1 year Over 20 years 34 All holders 42,209 44,557 46,134 46,560 10,530 13,249 13,234 14,221 35 U.S. Govt, agencies and trust funds 2,562 1,754 1,751 1,554 2,053 2,401 2,350 2,350 36 Federal Reserve Banks 8,827 9,098 9,064 9,928 2,601 3,587 3,466 3,527 37 Private investors 30,820 33,705 35,319 35,078 5,876 7,261 7,418 8,344 38 Commercial banks 12,394 12,111 13,096 13,427 271 334 292 423 39 Mutual savings banks 429 658 692 732 112 68 54 115 40 Insurance companies 511 636 696 727 436 561 536 529 41 Nonfinancial corporations 1,276 1,384 1,299 1,026 57 32 31 36 42 Savings and loan associations.... 396 615 659 669 22 18 14 12 43 State and local governments 722 1,152 1,193 1,050 558 689 800 821 44 All others 15,092 17,149 17,684 17,446 4,420 5,559 5,691 6,409 NOTE.—Direct public issues only. Based on Treasury Survey of Owner- banks, 470 mutual savings banks, and 729 insurance companies, each ship. From Treasury Bulletin (U.S. Treasury Dept.). about 90 per cent; (2) 449 nonfinancial corporations and 486 savings Data complete for U.S. Govt, agencies and trust funds and F.R. Banks, and loan assns., each about 50 per cent; and (3) 500 State and local but data for other groups include only holdings of those institutions govts., about 40 per cent. that report. The following figures show, for each category, the number "All others," a residual, includes holdings of all those not reporting and proportion reporting as of November 30, 1976; (1) 5,507 commercial in the Treasury Survey, including investor groups not listed separately. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A34 DomesticN onfinancial Statistics • January 1977 1.44 U.S. GOVERNMENT SECURITIES DEALERS Transactions Par value; averages of daily figures, in millions of dollars 1976 1976 IIIttteeemmm 111999777444 111999777555 Week ending Wednesday SSeepptt.. OOcctt.. NNoovv.. Nov. 24 Dec. 1 Dec. 8 Dec. 15 Dec. 22 Dec. 29 1 U.S. Govt, securities 3,579 6,027 9,541 13,240 14,995 17,999 16,765 15,483 13,959 12,704 8,649 By maturity: 2 Bills 2,550 3,889 5,691 7,425 8,565 9,221 9,095 7,646 8,267 7,853 5,641 3 Other within 1 year 250 223 136 179 170 145 216 192 201 144 130 4 1-5 years 465 1,414 2,488 3,084 4,034 5,982 5,056 4,788 3,529 3,038 1,550 5 5-10 years 256 363 956 2,252 1,804 2,186 1,990 2,323 1,616 1,363 1,043 6 Over 10 years 58 138 270 300 422 465 408 534 346 306 285 By type of customer: 7 U.S. Govt, securities dealers 652 885 1,273 1,632 1,873 1,985 2,002 1,322 1,539 1,748 1,604 8 U.S. Govt, securities brokers 965 1,750 2,889 4,768 5,389 6,849 5,636 6,079 5,069 4,260 2,118 9 Commercial banks 998 1,451 2,239 2,956 3,280 4,144 4,143 3,530 2,931 3,002 2,117 10 All others1 964 1,941 3,139 3,883 4,453 5,022 4,983 4,551 4,419 3,694 2,810 11 Federal agency securities 965 1,043 1,616 2,230 2,096 3,067 2,687 2,740 2,083 2,191 1,003 i Includes—among others—all other dealers and brokers in commodi- Transactions are market purchases and sales of U.S. Govt, securities ties and securities, foreign banking agencies, and the Federal Reserve dealers reporting to the F.R. Bank of New York. The figures exclude System. allotments of, and exchanges for, new U.S. Govt, securities, redemptions of called or matured securities, or purchases or sales of securities under NOTE.—Averages for transactions are based on number of trading days repurchase, reverse repurchase (resale), or similar contracts. in the period. 1.45 U.S. GOVERNMENT SECURITIES DEALERS Positions and Sources of Financing Par value; averages of daily figures, in millions of dollars 1976 1976 IIIttteeemmm 111999777444 111999777555 Week ending Wednesday SSeepptt.. OOcctt.. NNoovv.. Oct. 20 Oct. 27 | Nov. 3 Nov. 10 Nov. 17 Nov. 24 Positions2 1111 UUUU....SSSS.... GGGGoooovvvveeeerrrrnnnnmmmmeeeennnntttt sssseeeeccccuuuurrrriiiittttiiiieeeessss 2,580 5,884 9,496 8,045 9,744 7,716 7,984 7,740 11,115 9,753 9,511 2222 BBBBiiiillllllllssss 1,932 4,297 7,988 6,213 7,321 5,823 6,331 6,385 8,211 7,336 7,057 3333 OOOOtttthhhheeeerrrr wwwwiiiitttthhhhiiiinnnn 1111 yyyyeeeeaaaarrrr -6 265 164 228 161 202 292 224 230 118 107 4444 1111----5555 yyyyeeeeaaaarrrrssss 265 886 530 672 1,102 677 716 504 1,250 953 1,275 5555 5555----11110000 yyyyeeeeaaaarrrrssss 302 300 510 695 789 732 480 492 1,101 892 635 6666 OOOOvvvveeeerrrr 11110000 yyyyeeeeaaaarrrrssss 88 136 304 237 372 282 165 135 323 453 438 7777 FFFFeeeeddddeeeerrrraaaallll aaaaggggeeeennnnccccyyyy sssseeeeccccuuuurrrriiiittttiiiieeeessss 1,212 943 867 1,095 1,110 1,118 939 912 855 950 1,356 Sources of financing3 8888 AAAAllllllll ssssoooouuuurrrrcccceeeessss 3,977 6,666 10,827 9,433 11,613 9,200 9,455 10,023 12,087 11,444 12,000 CCCCoooommmmmmmmeeeerrrrcccciiiiaaaallll bbbbaaaannnnkkkkssss:::: 9999 NNNNeeeewwww YYYYoooorrrrkkkk CCCCiiiittttyyyy 1,032 1,621 2,073 2,038 2,453 2,008 2,333 2,131 2,812 2,405 2,307 11110000 OOOOuuuuttttssssiiiiddddeeee NNNNeeeewwww YYYYoooorrrrkkkk CCCCiiiittttyyyy 1,064 1,466 1,949 2,038 2,397 2,013 1,828 1,914 3,171 2,255 2,409 11111111 CCCCoooorrrrppppoooorrrraaaattttiiiioooonnnnssss1111 459 842 1,715 1,523 1,871 1,555 1,516 1,470 1,872 1,942 2,054 11112222 AAAAllllllllooootttthhhheeeerrrr 1,423 2,738 5,091 3,835 4,893 3,623 3,778 4,509 4,232 4,842 5,231 *A11 business corporations except commercial banks and insurance some that more nearly represent investments by the holders of the securicompanies. ties rather than dealer trading positions. 2 Figures include all securities sold by dealers under repurchase con- 3 Both bank and nonbank dealers are included. See also note 2. tracts, unless the contract is matched by a reverse repurchase (resale) agreement or delayed delivery sale with the same maturity and involving NOTE.—Averages for positions are based on number of trading days the same amount of securities. Included in the repurchase contracts are in the period; those for financing, on the number of calendar days in the period. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A35 1.45 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt Outstanding Millions of dollars; end of period Agency 1974 1975 July Aug. Sept. Oct. 1 Federal and Federally sponsored agencies. 71,591 89,378 97,678 99,853 100,837 101,722 102,454 103,871 2 Federal agencies 11,554 12,719 19,046 20,848 21,029 21,453 21,895 22,676 Defense Department1 1,439 1,312 1,220 1,171 1,164 1,152 1,136 1,128 Export-Import Bank2,3 2,625 2,893 7,188 7,578 7,578 7,945 7,728 8,353 Federal Housing Administration4 415 440 564 581 584 582 578 589 Government National Mortgage Association Participation Certificates 5 4,390 4,280 4,200 4,180 4,145 4,145 4,145 4,145 Postal Service 6 250 721 1,750 2,998 2,998 2,998 3,498 3,498 Tennessee Valley Authority 2,435 3,070 3,915 4,255 4,470 4,535 4,713 4,865 United States Railway Association6 3 209 85 90 96 97 98 10 Federally sponsored agencies 60,037 76,659 78,632 79,005 79,808 80,269 80,559 81,195 11 Federal Home Loan Banks 15,362 21,890 18,900 17,140 17,102 17,113 17,061 17,130 12 Federal Home Loan Mortgage Corporation. 1,784 1,551 1,550 1,550 1,550 1,150 1,150 1,150 13 Federal National Mortgage Association 23,002 28,167 29,963 29,863 29,845 30,429 30,685 30,656 14 Federal land banks 10,062 12,653 15,000 16,060 16,566 16,566 16,566 17,124 15 Federal intermediate credit banks 6,932 8,589 9,254 10,298 10,595 10,687 10,791 10,712 16 Banks for cooperatives 2,695 3,589 3,655 3,694 3,745 3,919 3,901 4,023 17 Student Loan Marketing Association 200 220 310 400 405 405 405 400 18 MEMO: Federal Financing Bank FFB Debt6,7 4,474 17,154 22,411 24,149 25,052 25,888 26,636 27,028 Lending to Federal and Federally sponsored agencies: Export-Import Bank3 ,595 4,985 4,985 4,985 4,768 4,768 4,768 Postal Service6 500 ,500 2,748 2,748 2,748 3,248 3,248 3,298 Student Loan Marketing Association7 220 310 400 405 405 405 400 395 Tennessee Valley Authority 895 ,840 2,180 2,495 2,560 2,738 2,810 2,890 United States Railway Association6 3 209 85 90 96 97 98 99 Other lending:9 24 Farmers Home Administration 2,500 7,000 8,800 9,200 9,650 9,650 10,250 10,250 25 Rural Electrification Administration. 566 1,114 1,164 1,215 1,514 1,573 1,320 26 Others 356 1,134 2,099 3,062 3,393 3,468 3,489 4,058 1 Consists of mortgages assumed by the Defense Department between 7 Unlike other Federally sponsored agencies, the Student Loan 1957 and 1963 under family housing and homeowners assistance programs. Marketing Association may borrow from the Federal Financing Bank 2 Includes participation certificates reclassified as debt beginning (FFB) since its obligations are guaranteed by the Department of Health, Oct. 1, 1976. Education, and Welfare. 3 Off-budget August 1971 through Oct. 1, 1976; on-budget there- 8 The FFB, which began operations in 1974, is authorized to purchase after. or sell obligations issued, sold, or guaranteed by other Federal agencies. 4 Consists of debentures issued in payment of Federal Housing Ad- Since FFB incurs debt solely for the purpose of lending to other agencies, ministration insurance claims. Once issued, these securities may be sold its debt is not included in the main portion of the table in order to avoid privately on the securities market. double counting. 5 Certificates of participation issued prior to fiscal 1969 by the Govern- 9 Includes FFB purchases of agency assets and guaranteed loans; ment National Mortgage Association acting as trustee for the Farmers the latter contain loans guaranteed by numerous agencies with the Home Administration; Department of Health, Education and Welfare; guarantees of any particular agency being generally small. Note that the Department of Housing and Urban Development; Small Business Ad- Farmers Home Administration item consists exclusively of agency assets ministration; and the Veterans Administration. while the Rural Electrification Administration entry contains both 6 Off-budget. agency assets and guaranteed loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 Domestic Nonfinancial Statistics • January 1977 1.47 NEW SECURITY ISSUES State and Local Government and Corporate Millions of dollars 1976 Type of issue or issuer, 1973 1974 1975 or use May June July Aug. Sept. State and local government 1 All issues (new and refunding)1 23,969 24,315 30,607 3,490 3,028 2,691 2,765 2,808 By type of issue: General obligation 1122,,225577 1133,,556633 16,020 1,866 1,689 1,186 1,269 1,265 Revenue 1100,,663322 1100,,221122 14,511 1,611 1,324 1,496 1,488 1,538 Housing Assistance Administration2 11,,002222 446611 U.S. Government loans 5588 7799 76 13 15 9 8 5 By type of issuer: State 4,212 4,784 7,438 824 590 308 669 470 Special district and statutory authority 9,505 8,638 12,441 1,400 1,097 1,261 1,162 1,229 Municipalities, counties, townships, school districts. 10,249 10,817 10,660 1,256 1,331 1,118 930 1,104 Issues for new capital: 9 Total 22,397 23,508 29,495 3,303 2,807 2,470 2,504 2,590 By use of proceeds: 10 Education 4,311 4,730 4,689 710 414 309 373 356 11 Transportation 2,804 1,712 2,208 416 128 36 166 251 12 Utilities and conservation. 5,654 5,634 7,209 956 745 1,000 784 747 13 Social welfare 4,588 3,820 4,392 477 423 488 694 767 14 Industrial aid 571 494 445 14 47 66 24 30 15 Other purposes 4,465 7,118 10,552 730 1,050 571 463 439 Corporate 16 All issues3 32,025 38,311 53,644 4,186 6,418 3,216 3,350 4,803 17 Bonds 21,049 32,066 42,756 2,988 5,023 2,578 2,672 2,249 By type of offering: 18 Public 13,244 25,903 32,583 1,937 3,140 1,239 1,565 2,100 19 Private placement 7,802 6,160 10,172 1,051 1,883 1,348 1,107 2,149 By industry group: 20 Manufacturing 4,199 9,867 16,980 1,225 1,321 1,090 742 666 21 Commercial and miscellaneous. 1,318 1,845 2,750 185 483 171 319 545 22 Transportation 1,084 1,550 3,439 118 263 118 48 1,205 23 Public utility . 5,578 8,873 9,658 643 869 621 663 1,116 24 Communication . 3,523 3,710 3,464 12 698 20 209 140 25 Real estate and financial 5,344 6,218 6,469 806 1,389 568 692 577 26 Stocks . 10,979 6,247 10,863 1,198 1,395 629 678 554 By type: 27 Preferred 3,337 2,253 3,458 299 360 89 214 136 28 Common • 7,642 3,994 7,405 899 1,035 540 464 418 By industry group: 29 Manufacturing 638 555444444 1,670 484 125 108 282 83 30 Commercial and miscellaneous. . 1,532 999444000 1,470 136 58 164 69 33 31 Transportation 26 222222 3 13 7 32 Public utility 4,691 333,,,999666444 66,,223355 550055 447799 311 257 347 33 Communication 1 348 222111777 11,,000022 88 771111 6 3 34 Real estate and financial 2,745 555666222 448888 6633 1199 40 54 84 1 Par amounts of long-term issues based on date of sale. than $100,000, secondary offerings, undefined or exempted issues as 2 Only bonds sold pursuant to the 1949 Housing Act, which are secured defined in the Securities Act of 1933, employee stock plans, investment by contract requiring the Housing Assistance Administration to make companies other than closed-end, intracorporate transactions, and sales to annual contributions to the local authority. foreigners. 3 Figures, which represent gross proceeds of issues maturing in more SOURCES: State and local government securities, Securities Industry than one year, sold for cash in the United States, are principal amount or Association; corporate securities, Securities and Exchange Commission. number of units multiplied by offering price. Excludes offerings of less Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Corporate Finance A37 1.48 CORPORATE SECURITIES Net Change in Amounts Outstanding Millions of dollars 1975 1976 Source of change, or industry 1973 1974 1975 Q1 Q2 Q3 Q4 Q1 Q2 Q3 All issues1 1 New issues 33,559 39,344 53,255 15,211 15,602 9,079 13,363 13,671 14,229 11,385 2 Retirements 11,804 9,935 10,991 2,088 3,211 2,576 3,116 2,315 3,668 2,478 3 Net change 21,754 29,399 42,263 13,123 12,390 6,503 10,247 11,356 10,561 8,907 Bonds and notes 4 New issues 21,501 31,354 40,468 12,759 11,460 6,654 9,595 9,404 10,244 8,701 5 Retirements 8,810 6,255 8,583 1,587 2,336 2,111 2,549 1,403 3,159 1,826 Net change: 6 Total 12,691 25,098 31,886 11,172 9,124 4,543 7,047 8,001 7,084 6,875 By industry: 7 Manufacturing 801 7,404 13,219 5,134 4,574 1,442 2,069 2,966 1,529 1,551 9 8 T C r o a m n m sp e o r r c t i a a t l i o a n n , d i n o c t l h u e d r i 2 n g railroad 1 -1 ,0 0 4 9 4 1,1 3 1 4 6 1 2 1 , , 1 6 6 0 5 5 373 1 4 4 2 8 9 3 2 1 2 4 1 7 1,5 5 8 2 8 8 2 98 0 5 3 4 7 8 2 8 6 1,0 6 9 1 2 0 10 Public utility 4,265 7,308 7,236 2,653 1,977 1,395 1,211 1,820 1,260 2,109 11 Communication 3,165 3,499 2,980 1,269 810 472 429 498 953 335 12 Real estate and financial 3,523 5,428 4,682 1,742 852 866 1,222 1,530 2,128 1,178 Common and preferred stock 13 New issues 12,057 7,980 12,787 2,452 4,142 2,425 3,768 4,267 3,985 2,684 14 Retirements 2,993 3,678 2,408 501 875 465 567 912 509 652 Net change: 15 Total 9,064 4,302 10,377 1,951 3,266 1,960 3,200 3,355 3,477 2,032 By industry: 16 Manufacturing 658 17 1,607 262 500 412 433 838 1,120 744 1 1 7 8 T C r o a m n m sp e o r r c t i a a t l i o a n n , d i n o c t l h u e d r i 2 n g railroad 1, - 4 9 1 3 1 -1 -2 3 0 5 1,13 6 7 5 77 1 490 7 1 5 0 3 8 462 4 88 5 3 2 1 5 8 11 1 7 7 19 Public utility 4,509 3,834 6,015 1,569 1,866 1,043 1,537 2,174 1,300 932 20 Communication 1,399 398 1,084 24 359 97 604 47 735 19 21 Real estate and financial 1,181 207 468 18 43 247 160 203 -21 203 1 Excludes issues of investment companies. New issues and retirements exclude foreign sales and include sales of 2 Extractive and commercial and miscellaneous companies. securities held by affiliated companies, special offerings to employees, new stock issues and cash proceeds connected with conversions of bonds NOTE.—Securities and Exchange Commission estimates of cash trans- into stocks. Retirements, defined in the same way, include securities actions only, as published in the Commission's Statistical Bulletin. retired with internal funds or with proceeds of issues for that purpose. 1.49 OPEN-END INVESTMENT COMPANIES Net Sales and Asset Position Millions of dollars 1976 IItteemm 11997744 11997755 May June July Aug. Sept. Oct. Nov. Investment companies excluding money market funds: 3,348 3,302 241 321 281 256 338 378 432 2 Redemptions of own shares2 3,397 3,686 589 599 596 536 573 450 419 -49 384 -348 -278 -315 -280 -235 -72 -13 35,777 42,179 45,122 46,801 45,986 45,457 46,138 44,858 45,359 5,637 3,748 2,769 2,679 2,547 2,561 2,507 2,434 2,624 30,140 38,431 42,353 44,122 43,439 42,896 43,631 42,424 42,735 1 Includes reinvestment of investment income dividends. Excludes 4 Also includes all U.S. Government securities and other short-term reinvestment of capital gains distributions and share issue of conversions debt securities. from one fund to another in the same group. 2 Excludes share redemption resulting from conversions from one fund NOTE.—Investment Company Institute data based on reports of memto another in the same group. bers, which comprise substantially all open-end investment companies 3 Market value at end of period, less current liabilities. registered with the Securities and Exchange Commission. Data reflect newly formed companies after their initial offering of securities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A38 Domestic Nonfinancial Statistics • January 1977 1.50 CORPORATE PROFITS, TAXES, AND DIVIDENDS Billions of dollars; quarterly data are at seasonally adjusted annual rates 1975 1976 AAccccoouunntt 11997733 11997744 11997755 Q 1 Q2 Q3 Q4 Q 1 Q2 Q3 115.8 127.6 114.5 94.2 105.8 126.9 131.3 141.1 146.2 150.2 2 Profits tax liability 48.7 52.4 49.2 40.2 44.8 54.8 57.2 61.4 63.5 65.4 3 Profits after tax 67.1 75.2 65.3 54.0 61.0 72.1 74.2 79.7 82.7 84.5 4 Dividends.. 27.8 30.8 32.1 31.7 31.9 32.6 32.2 33.1 34.4 35.4 5 Undistributed profits 39.3 44.4 33.2 22.3 29.1 39.5 42.0 46.6 48.3 49.4 6 Capital consumption allowances1 73.7 81.6 89.4 86.4 87.9 90.5 92.9 94.3 96.2 98.2 7 Net cash flow 113.0 126.0 122.6 108.7 117.0 130.0 134.9 140.9 144.5 147.6 i With capital consumption adjustment. SOURCE.—U.S. Dept. of Commerce, Survey of Current Business. 1.51 NONFINANCIAL CORPORATIONS Current Assets and Liabilities Billions of dollars, end of period 1974 1975 1976 AAccccoouunntt 11997711 11997722 11997733 Q4 Q 1 Q2 Q3 Q4 Ql Q2 1 Current assets 529.4 574.4 643.2 712.2 698.4 703.2 716.5 731.6 753.5 775.4 2 Cash 53.3 57.5 61.6 62.7 60.6 63.7 65.6 68.1 68.4 70.8 3 U.S. Govt, securities 11.0 10.2 11.0 11.7 12.1 12.7 14.3 19.4 21.7 23.3 4 Notes and accounts receivable 221.1 243.4 269.6 293.2 285.1 288.1 298.0 298.2 310.9 321.8 5 U.S. Govt.1 3.5 3.4 3.5 3.5 3.2 3.3 3.3 3.6 3.6 3.1 6 Other 217.6 240.0 266.1 289.7 281.9 284.8 294.7 294.6 307.3 318.1 7 Inventories 200.4 215.2 246.7 288.0 285.2 281.4 279.6 285.8 288.8 295.6 8 Other 43.8 48.1 54.4 56.6 55.4 57.3 59.0 60.0 63.6 63.9 9 326.0 352.2 401.0 450.6 438.0 434.2 444.7 457.5 465.9 475.9 10 Notes and accounts payable 220.5 234.4 265.9 292.7 276.5 275.9 279.6 288.0 286.9 293.8 11 U.S. Govt.1 4.9 4.0 4.3 5.2 5.3 5.8 6.2 6.4 6.4 6.8 12 Other 215.6 230.4 261.6 287.5 271.2 270.1 273.4 281.6 280.5 287.0 13 Accrued Federal income taxes 13.1 15.1 18.1 23.2 21.8 17.7 19.4 20.7 23.9 22.0 14 Other 92.4 102.6 117.0 134.8 139.8 140.6 145.6 148.8 155.0 160.1 15 Net working capital 203.6 221.3 242.3 261.5 260.4 269.0 271.8 274.1 287.6 299.5 1 Receivables from, and payables to, the U.S. Govt, exclude amounts SOURCE.—Securities and Exchange Commission estimates published offset against each other on corporations' books. in the Commission's Statistical Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Corporate Finance A39 1.52 BUSINESS EXPENDITURES on New Plant and Equipment Billions of dollars; quarterly data are at seasonally adjusted annual rates 1975 1976 IInndduussttrryy 11997733 11997744 11997755 Q2 Q3 Q4 Q 1 Q2 Q 32 Q 42 1 All industries 99.74 112.40 112.78 112.46 112.16 111.80 114.72 118.12 122.96 127.03 Manufacturing: 2 Durable goods industries 19.25 22.62 21.84 22.59 21.01 21.07 21.63 22.54 24.08 24.80 3 Nondurable goods industries 18.76 23.39 26.11 26.19 26.38 25.75 27.58 28.09 29.73 31.49 Nonmanufacturing: 4 Mining 2.74 3.18 3.79 3.78 3.82 3.82 33..8833 33..8833 33..8877 44..0022 Transportation: 5 Railroad 1.96 2.54 2.55 2.70 2.75 2.39 2.08 2.64 2.31 1.71 6 Air 2.41 2.00 1.84 1.60 2.12 1.65 1.18 1.44 1.42 1.31 7 Other 1.66 2.12 3.18 2.75 2.99 3.56 3.29 4.16 3.44 3.06 Public utilities: 8 Electric 15.94 17.63 17.00 16.41 16.58 17.92 18.56 18.82 19.66 20.28 9 Gas and other 2.76 2.92 3.14 3.11 3.21 3.00 3.36 3.03 3.44 3.80 1 1 0 1 C Co o m m m m e u r n c i i c a a l ti a o n n d other1 2 1 1 2 . .8 4 5 0 2 1 2 3 . . 0 9 5 6 2 1 0 2 . . 6 7 0 4 2 1 0 2 . . 8 5 3 0 2 1 0 2 . .9 3 5 4 2 1 0 2 . . 4 2 4 2 2 1 0 2 . . 6 5 8 4 2 1 0 2 . . 9 6 4 2 | 35.02 36.56 1 Includes trade, service, construction, finance, and insurance. NOTE.—Estimates for corporate and noncorporate business, excluding 2 Anticipated by business. agriculture; real estate operators; medical, legal, educational, and cultural service; and nonprofit organizations. SOURCE.—U.S. Dept. of Commerce, Survey of Current Business. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A40 Domestic Nonfinancial Statistics • January 1977 1.53 MORTGAGE MARKETS Millions of dollars, except as noted 1976 11997733 11997744 11997755 j IIIttteeemmm June July Aug. Sept. Oct. Nov. Terms and yields in primary and secondary markets PRIMARY MARKETS Conventional mortgages on new homes: Terms:1 1 Purchase price (thous. dollars) 37.1 40.1 44.6 48.9 49.4 49.6 50.6 49.0 48.6 2 Amount of loan (thous. dollars) 28.1 29.8 33.3 36.2 36.7 36.8 37.4 36.2 36.1 3 Loan-to-price ratio (per cent) 77.3 75.8 76.1 75.1 75.8 75.8 75.6 75.3 75.5 4 Maturity (years) 26.3 26.3 26.8 26.5 27.1 27.8 27.7 28.0 27.0 5 Fees and charges (per cent of loan amount)2. 1.11 1.30 15.4 1.27 1.29 1.38 1.42 1.38 1.35 6 Contract rate (per cent per annum) 7.78 8.71 8.75 8.69 8.76 8.79 8.85 8.85 8.84 Yield (per cent per annum): 7 FHLBB series3 8.49 9.37 9.01 8.89 8.97 9.02 9.08 9.07 9.06 8 HUD series4 8.30 9.22 9.10 9.05 9.05 9.05 9.00 9.00 8.95 SECONDARY MARKETS Yields (per cent per annum) on— 9 FHA mortgages (HUD series)5 8.19 9.55 9.19 9.05 8.99 8.93 8.82 8.55 8.45 10 GNMA securities6 7.81 8.62 8.56 8.35 8.37 8.30 8.10 7.98 7.93 FNMA auctions:7 11 Government-underwritten loans 8.78 9.53 9.31 9.15 9.05 8.99 8.88 8.75 8.66 12 Conventional loans 8.82 9.70 9.36 9.31 9.25 9.15 9.11 9.05 9.00 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period): 13 Total 24,175 29,578 31,824 32,028 32,011 32,069 32,062 32,019 32,929 14 FHA-insured 16,852 19,189 19,732 19,238 19,184 19,180 19,133 19,077 18,986 15 VA-guaranteed 6,352 8,310 9,573 9,391 9,388 9,394 9,366 9,314 9,264 16 Conventional 971 2,080 2,519 3,399 3,439 3,496 3,563 3,628 4,679 Mortgage transactions (during period): 17 Purchases 6,127 6,953 4,263 240 210 277 199 162 1,131 18 Sales 71 5 2 597 689 8 Mortgage commitments: 8 19 Contracted (during period) 8,914 10,765 6,106 857 584 492 463 480 615 20 Outstanding (end of period) 7,889 7,960 4,126 4,153 4,245 4,335 3,983 3,672 3,649 Auction of 4-month commitments to buy- Go vernment-underwriten loans : 21 Offered 9 5,196.7 5,492.7 6,558.8 757.3 460.1 361.4 221.0 235.5 494.1 22 Accepted 3,069.1 2,371.4 3,848.5 481.0 300.4 214.4 117.9 107.1 221.1 Conventional loans: 23 Offered 9 51.4 61.3 185.4 302.3 221.2 298.8 321.7 297.5 353.3 24 Accepted 32.2 40.6 83.5 220.0 187.2 208.7 225.4 215.8 296.9 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period):10 25 Total 2,604 4,586 4,987 4,529 4,551 4,310 4,269 4,190 26 FHA/VA 1,743 1,904 1,824 1,729 1,713 1,695 1,679 1,660 27 Conventional 861 2,682 3,163 2,801 2,838 2,614 2,590 2,530 Mortgage transactions (during period): 28 Purchases 1,334 2,191 1,716 163 152 77 88 78 29 Sales 409 52 1,020 75 84 278 93 116 Mortgage commitments:11 30 Contracted (during period) 1,629 4,553 982 72 39 117 163 171 31 Outstanding (end of period) 186 2,390 111 285 154 175 243 326 1 Weighted averages based on sample surveys of mortgages originated securities, assuming prepayment in 12 years on pools of 30-year FHA/VA by major institutional lender groups. Compiled by the Federal Home Loan mortgages carrying the prevailing ceiling rate. Monthly figures are Bank Board in cooperation with the Federal Deposit Insurance Cor- unweighted averages of Monday quotations for the month. poration. 7 Average gross yields (before deduction of 38 basis points for mortgage 2 Includes all fees, commissions, discounts, and "points" paid (by servicing) on accepted bids in Federal National Mortgage Association's the borrower or the seller) in order to obtain a loan. auctions of 4-month commitments to purchase home mortgages, assuming 3 Average effective interest rates on loans closed, assuming prepayment prepayment in 12 years for 30-year mortgages. No adjustments are made at the end of 10 years. for FNMA commitment fees or stock purchase and holding requirements. 4 Average contract rates on new commitments for conventional first Monthly figures are unweighted averages for auctions conducted within mortgages, rounded to the nearest 5 basis points; from Dept. of Housing the month. and Urban Development. 8 Includes some multifamily and nonprofit hospital loan commitments 5 Average gross yields on 30-year, minimum-downpayment, FHA- in addition to 1- to 4-family loan commitments accepted in FNMA's insured first mortgages for immediate delivery in the private secondary free market auction system, and through the FNMA-GNMA Tandem market. Any gaps in data are due to periods of adjustment to changes in plans. maximum permissible contract rates. 9 Mortgage amounts offered by bidders are total bids received. 6 Average net yields to investors on Government National Mortgage 10 Includes participations as well as whole loans. Association-guaranteed, mortgage-backed, fully-modified pass-through 11 Includes conventional and Government-underwritten loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Real Estate Debt A41 1.54 MORTGAGE DEBT OUTSTANDING Millions of dollars End of year End of quarter Type of holder, and type of property 1975 1976 1972 1973 1974 Q3 Q4 Q 1 Q 2 Q 3p 1 All holders 603,417 682,321 742,504 785,367 801,546 817,429 839,184 861,735 2 1-to 4-family 372,793 416,883 449,937 479,983 491,678 503,411 519,553 536,639 3 Multifamily 82,572 92,877 99,851 100,464 100,348 100,699 100,954 101,828 4 Commercial 112,294 131,308 146,428 154,736 158,644 160,954 164,428 167,539 5 Farm 35,758 41,253 46,288 50,184 50,876 52,365 54,249 55,729 6 Major financial institutions 450,000 505,400 542.552 569,935 581,296 592,061 609,086 625,971 7 Commercial banks1 99.314 119,068 132,105 134,514 136,186 137,986 141,086 143,986 8 1- to 4-family 57,004 67,998 74,758 76,149 77,018 78,218 80,218 81,928 9 Multifamily 5,778 6,932 7,619 6,363 5,915 5,515 5,115 5,040 10 Commercial 31,751 38,696 43,679 45,694 46,882 47,812 49,112 50,251 11 Farm 4,781 5,442 6,049 6,308 6,371 6,441 6,641 6,767 12 Mutual savings banks 67,556 73,230 74,920 76,490 77,249 77,738 78,735 79,842 13 1-to 4-family 46,229 48,811 49,213 49,719 50,025 50,344 50,989 51,705 14 Multifamily 10,910 12,343 12,923 13,523 13,792 13,876 14,030 14,228 15 Commercial 10,355 12,012 12,722 13,194 13,373 13,456 13,653 13,845 16 Farm 62 64 62 54 59 62 63 64 17 Savings and loan associations 206,182 231,733 249,293 270,600 278,693 286,556 299,574 312,152 18 1-to 4-family 167,049 187,750 201.553 218,483 224,710 231,337 241,996 252,531 19 Multifamily 20,783 22,524 23,683 24,976 25,417 25,847 26,722 27,469 20 Commercial 18,350 21,459 24,057 27,141 28,566 29,372 30,856 32,152 21 Life insurance companies 76,948 81.369 86,234 88,331 89,168 89,781 89,691 89,991 22 1-to 4-family 22.315 20,426 19,026 17,955 17,590 17,321 16,861 16,558 23 Multifamily 17,347 18,451 19,625 19,703 19,629 19,726 19,374 19,168 24 Commercial 31,608 36,496 41,256 44,042 45,196 45,907 46,456 47,156 25 Farm 5,678 5,996 6,327 6,631 6,753 6,827 7,000 7,109 26 Federal and related agencies 40,157 46,721 58,320 64,464 66,891 67,350 66,192 67,108 27 Government National Mortgage Assn. 5,113 4,029 4,846 6,534 7,438 7,619 5,557 5,068 28 1- to 4-family 2,513 1,455 2,248 3,692 4,728 4,886 3,165 2,486 29 Multifamily 2,600 2,574 2,598 2,842 2,710 2,733 2,392 2,582 30 Farmers Home Admin 1,019 1,366 1,432 1,118 1,109 650 830 730 31 1- to 4-family 279 743 759 343 208 97 228 83 32 Multifamily 29 29 167 134 215 23 46 27 33 Commercial 320 218 156 181 190 96 151 112 34 Farm 391 376 350 460 496 434 405 508 35 Federal Housing and Veterans Admin, 3,338 3,476 4,015 4,681 4,970 5,033 5,270 5,570 36 1- to 4-family 2,199 2,013 2,009 1,951 1 ,990 1,908 1,808 1,867 37 Multifamily 1,139 1,463 2,006 2,730 2,980 3,125 3,462 3,703 38 Federal National Mortgage Assn... . 19,791 24,175 29,578 31,055 31,824 32,182 32,028 32,962 39 1- to 4-family 17,697 20.370 23,778 25,049 25,813 26,262 26,112 27,030 40 Multifamily 2,094 3,805 5,800 6,006 6,011 5,920 5,916 5,932 41 Federal land banks 9,107 11,071 13,863 16,043 16,563 17,264 17,978 18,568 42 1- to 4-family 13 123 406 525 549 563 575 586 43 Farm 9,094 10,948 13,457 15,518 16,014 16,701 17,403 17,982 44 Federal Home Loan Mortgage Corp. 1,789 2,604 4,586 5,033 4,987 4,602 4,529 4,210 45 1-to 4-family 1 ,754 2,446 4,217 4,632 4,588 4,247 4,166 3,873 46 Multifamily 35 158 369 401 399 355 363 337 47 Mortgage pools or trusts2 14,404 18,040 23,799 31,483 34,138 37,684 41,225 44,762 48 Government National Mortgage Assn. 5,504 7,890 11,769 16,595 18,257 20,479 23,634 26,834 49 1-to 4-family 5,353 7,561 11,249 15,946 17,538 19,693 22,821 25,910 50 Multifamily 151 329 520 649 719 786 813 924 51 Federal Home Loan Mortgage Corp, 441 766 757 1,323 1,598 1,999 2,153 2,290 5 5 2 3 M 1- u to lt i 4 f - a f m am ily il y 3 1 3 1 1 0 6 1 1 4 7 9 6 1 0 4 8 9 1,1 2 0 1 5 8 1,3 2 4 4 9 9 1,6 3 9 0 8 1 1,8 3 3 2 1 2 1,9 3 4 4 8 2 54 Farmers Home Admin 8,459 9,384 11,273 13,565 14,283 15,206 15,438 15,638 55 1-to 4-family 5,017 5,458 6,782 8,563 9,194 9,516 9,670 9,796 56 Multifamily 131 138 116 296 295 542 541 547 57 Commercial 867 1,124 1,473 1,765 1,948 2,122 2,104 2,131 58 Farm 2,444 2,664 2,902 2,941 2,846 3,026 3,123 3,164 59 Individuals and others3 98,856 112,160 117,833 119,485 119,221 120,334 122,681 123,894 60 1-to 4-family 45,040 51,112 53,331 55,871 56,378 57,321 59,113 60,338 61 Multifamily 21,465 23,982 24,276 22,623 22,017 21,950 21,858 21,529 62 Commercial 19,043 21,303 23,085 22,719 22,489 22,189 22,096 21,892 63 Farm 13,308 15,763 17,141 18,272 18,337 18,874 19,614 20,135 t 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 Outstanding principal balances of mortgages backing securities in- with the Federal Home Loan Bank Board and the Dept. of Commerce. sured or guaranteed by the agency indicated. Separation of nonfarm mortgage debt by type of property, if not re- 3 Other holders include mortgage companies, real estate investment ported directly, and interpolations and extrapolations where required, are trusts, State and local credit agencies, State and local retirement funds, estimated mainly by Federal Reserve. Multifamily debt refers to loans on noninsured pension funds, credit unions, and U.S. agencies for which structures of 5 or more units. amounts are small or separate data are not readily available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A42 Domestic Nonfinancial Statistics • January 1977 1.55 CONSUMER INSTALMENT CREDIT Total Outstanding, and Net Change Millions of dollars 1976 HHoollddeerr,, aanndd ttyyppee ooff ccrreeddiitt 1973 1974 1975 May June July Aug. Sept. Oct. Nov. Amounts outstanding (end of period) 1 146,434 155,384 162,237 164,101 166,664 168,674 171,160 172,918 173,930 175,333 By holder: ?, Commercial banks 71,871 75,846 78,703 79,785 80,850 81,930 82,961 83,714 84,152 84,278 3 Finance companies 35,404 36,208 36,695 37,022 37,490 38,026 38,398 38,575 38,809 39,129 4 Credit unions 19,609 22,116 25,354 26,975 27,842 28,234 28,956 29,600 29,711 30,053 Retailers1 16,395 17,933 18,002 16,465 16,633 16,660 16,911 17,012 17,205 17,726 6 Others2 3,155 3,281 3,483 3,854 3,849 3,824 3,934 4,017 4,053 4,147 By type of credit: 7 Automobile, total 50,065 50,392 53,028 55,484 56,667 57,659 58,665 59,270 59,717 60,002 8 Commercial banks 31,502 30,994 31,534 32,664 33,269 33,877 34,414 34,701 35,009 35,095 9 Purchased 18,997 18,687 18,353 18,671 18,912 19,151 19,404 19,495 19,611 19,575 10 12,505 12,306 13,181 13,993 14,358 14,726 15,010 15,206 15,398 15,520 11 Finance companies 10,718 10,618 11,439 12,080 12,333 12,573 12,748 12,808 12,901 12,957 12 Credit unions 7,456 8,414 9,653 10,269 10,601 10,749 11,024 11,270 11,311 11,442 13 Others 389 366 402 471 464 460 479 491 496 508 Mobile homes: 14 Commercial banks 8,340 8,972 8,704 8,408 8,390 8,384 8,379 8,340 8,294 8,254 15 Finance companies 3,358 3,524 3,451 3,336 3,343 3,333 3,323 3,319 3,309 3,295 16 Home improvement, total 6,950 7,754 8,004 8,209 8,367 8,452 8,562 8,665 8,726 8,790 17 Commercial banks 4,083 4,694 4,965 5,048 5,129 5,192 5,263 5,318 5,359 5,388 Revolving credit: 18 6,838 8,281 9,501 9,402 9,531 9,725 9,924 10,153 10,232 10,329 19 Bank check credit 2,254 2,797 2,810 2,777 2,805 2,835 2,870 2,922 2,933 2,935 20 All other, total 68,629 73,664 76,738 76,485 77,561 78,286 79,438 80,249 80,719 81,728 21 Commercial banks, total 18,854 20,108 21,188 21,486 21,726 21,917 22,112 22,280 22,325 22,277 22 Personal loans 12,873 13,771 14,629 14,871 15,034 15,148 15,308 15,450 15,534 15,517 23 Finance companies, total 20,914 21,717 21,655 21,466 21,675 21,983 22,192 22,316 22,469 22,748 24 Personal loans 16,483 16,961 17,681 17,631 17,811 18,079 18,275 18,371 18,509 18,773 25 Credit unions 11,564 13,037 14,937 15,894 16,402 16,635 17,060 17,438 17,505 17,706 26 16,395 17,933 18,002 16,465 16,633 16,660 16,911 17,012 17,205 17,726 27 Others 902 869 956 1,174 1,125 1,091 1,163 1,203 1,215 1,271 Net change (during period)3 28 Total 19,676 8,952 6,843 1,474 1,330 1,303 1,403 1,481 1,564 1,243 By holder: 29 Commercial banks 11,001 3,975 2,851 713 409 619 518 697 671 381 30 Finance companies 4,006 806 483 157 230 264 169 233 317 245 31 2,696 2,507 3,238 521 482 365 386 483 280 395 32 Retailers 1,632 1,538 69 5 214 116 183 24 263 98 33 Others 341 126 202 78 -5 -61 148 45 33 124 By type of credit: 34 Automobile, total 5,968 327 2,631 652 552266 555566 662211 605 528 477 35 Commercial banks 4,197 -508 535 340 229 327 377 376 350 221 36 Purchased 2,675 -310 -340 110 32 60 159 125 117 70 37 Direct 1,523 -198 875 230 197 267 218 251 233 151 38 Finance companies 740 -100 821 122 116 108 62 28 77 98 39 Credit unions 1,024 958 1,239 181 186 135 136 172 105 144 40 Other 7 -23 36 9 -4 -13 46 28 -4 14 Mobile homes: 41 Commercial banks 1,933 632 -268 -37 -42 -28 --3355 -53 --5566 -43 42 Finance companies 444 168 -73 -17 * -9 -16 -16 -16 -16 43 Home improvement, total 1,033 804 248 70 79 19 39 65 73 103 44 Commercial banks 482 611 271 36 29 22 25 43 44 55 Revolving credit: 45 Bank credit cards 1,430 1,443 1,220 193 98 117711 8866 116666 112233 7711 46 Bank check credit 478 543 14 44 14 27 -6 17 27 6 47 All other, total 8,389 5,036 3,072 570 655 567 714 698 884 645 48 Commercial banks, total 2,480 1,255 1,080 138 81 101 71 148 183 72 49 Personal loans 1,492 898 858 112 86 70 46 108 161 Al 50 Finance companies, total 2,564 803 -64 53 115 170 126 223 258 163 51 Personal loans 1,746 479 111 21 95 143 106 198 237 161 52 Credit unions 1,591 1,473 1,900 326 282 220 240 297 166 239 53 Retailers 1,632 1,538 69 5 214 116 183 24 263 98 54 Others 122 -33 87 48 -38 -39 96 5 15 73 1 Excludes 30-day charge credit held by retailers, oil and gas companies, 3 Net change equals extensions minus liquidations(repayments, chargeand travel and entertainment companies. offs, and other credits); figures for all months are seasonally adjusted. 2 Mutual savings banks, savings and loan associations, and auto dealers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Consumer Debt A43 1.56 CONSUMER INSTALMENT CREDIT Extensions and Liquidations Millions of dollars 1976 Holder, and type of credit 1973 1974 May June July Aug. Sept. Oct. Extensions1 1 Total 160,228 160,008 163,483 15,041 15,592 15,240 15,685 15,775 16,055 15,763 By holder: 2 Commercial banks 72,216 72,605 77,131 7,223 7,289 7,358 7,487 7,546 7,618 7,486 3 Finance companies 38,922 35,644 32,582 2,776 2,986 2,861 2,965 3,072 3,148 3,059 4 Credit unions 21,143 22,403 24,151 2,448 2,456 2,329 2,313 2,424 2,350 2,395 5 Retailers2 25,440 27,034 27,049 2,313 2,650 2,533 2,548 2,463 2,673 2,467 6 Others 3 2,507 2,322 2,570 280 ' 211 159 372 271 266 356 By type of credit: 7 Automobile, total 46,105 43,209 48,103 4,471 4,600 4,477 4,712 4,769 4,587 4,632 8 Commercial banks 29,369 26,406 28,333 2,616 2,660 2,680 2,762 2,846 2,770 2,691 9 Purchased 17,497 15,576 15,761 1 ,413 1 ,386 1,417 1,480 1,511 1,479 1,426 10 Direct 11,872 10,830 12,572 1 ,204 1 ,274 1,263 1,282 1,335 1,291 1,265 11 Finance companies 9.303 8,630 9,598 914 935 891 937 891 904 927 12 Credit unions 7,009 7,788 9,702 892 968 879 928 963 875 957 13 Others 424 385 470 49 36 27 84 69 37 57 Mobile homes: 14 Commercial banks 4,438 3,486 2,681 182 204 223 186 200 178 207 15 Finance companies 1,573 1,413 771 49 68 59 54 53 59 54 16 Home improvement, total... 4,414 4,571 4,398 385 410 381 400 434 463 464 17 Commercial banks 2,487 2,789 2,722 233 235 240 242 266 282 276 Revolving credit: 18 Bank credit cards 13,863 17,098 20,428 2,103 2,088 2,152 2,183 2,165 2,198 2,181 19 Bank check credit 3,373 4,227 4,024 422 435 401 413 375 413 410 20 All other, total 86,462 86,004 83,079 7,429 7,786 7,546 7,737 7,779 8,158 7,815 21 Commercial banks, total, 18,686 18,599 18,944 1,667 1,666 1,661 1,702 1,693 1,777 1,721 22 Personal loans 12,928 13,176 13,386 1,203 1,221 1,174 1,197 1,193 1,286 1,238 23 Finance companies, total 27,627 25,316 22,135 1,810 1,981 1,907 1,970 2,125 2,182 2,072 24 Personal loans 17,885 16,691 17,333 1,465 1,641 1,535 1,607 1,745 1,776 1,696 25 Credit unions 13,768 14,228 13,992 1,511 1,440 1,403 1,338 1,410 1,426 1,389 26 Retailers 25,440 27,034 27,049 2,313 2,650 2,533 2,548 2,463 2,673 2,467 27 Others 941 827 959 127 50 43 180 87 100 166 Liquidations1 28 Total 140,552 151,056 156,640 13,566 14,261 13,937 14,282 14,294 14,491 14,520 By holder: 29 Commercial banks 61 ,215 68,630 74,280 6,510 6,879 6,739 6,970 6,349 6,947 7,105 30 Finance companies 34,916 34,838 32,099 2,619 2,756 2,597 2,796 2,839 2,831 2,814 31 Credit unions 18,447 19,896 20,913 1,927 1,974 1,964 1,927 1,941 2,070 2,000 32 Retailers2 23,808 25,496 26,980 2,308 2,436 2,417 2,365 2,439 2,410 2,369 33 Others3 2,166 2,196 2,368 202 216 220 224 226 233 232 By type of credit: 34 Automobile, total 40,137 42,883 45,472 3,819 4,074 3,922 4,090 4,165 4,059 4,155 35 Commercial banks 25,172 26,915 27,798 2,276 2,432 2,354 2,385 2,470 2,420 2,470 36 Purchased 14,823 15,886 16,101 1,303 1,354 1,357 1,321 1,386 1,363 1,356 37 Direct 10,349 11,029 11,697 973 1,077 996 1,064 1,084 1,058 1,114 38 Finance companies 8,563 8,730 8,777 792 819 784 874 862 827 829 39 Credit unions 5,985 6,830 8,463 711 783 745 792 791 770 813 40 Others 417 408 434 39 40 39 39 42 42 43 Mobile homes: 41 Commercial banks 2,505 2,854 2,949 219 247 251 222 253 233 250 42 Finance companies 1,129 1,245 844 67 68 68 70 69 74 70 43 Home improvement, total.., 3,381 3,767 4,150 314 330 362 361 369 390 360 44 Commercial banks 2,005 2,178 2,451 197 206 218 216 223 239 221 Revolving credit: 45 Bank credit cards 12,433 15,655 19,208 1,911 1,990 1,981 2,097 2,000 2,074 2,110 46 Bank check credit 2,894 3,684 4,010 378 421 374 419 358 386 404 47 All other, total 78,072 80,969 80,007 6,859 7,132 6,979 7,023 7,081 7,274 7,170 48 Commercial banks, total. 16,205 17,345 17,864 1,529 1,585 1,560 1,631 1,545 1,594 1,649 49 Personal loans 11,435 12,278 12,528 1,091 1,135 1,104 1,151 1,085 1,125 1,191 50 Finance companies, total 25,063 24,513 22,199 1,758 1,866 1,737 1,844 1,902 1,924 1,909 51 Personal loans 16,139 16,212 16,616 1,445 1,546 1,392 1,501 1,547 1,539 1,535 52 Credit unions 12,177 12,755 12,092 1,185 1,158 1,183 1,098 1,113 1,260 1,150 5 5 3 4 O Re th ta e i r l s e rs 23,8 8 0 1 8 9 25,4 8 9 6 6 0 26,9 8 8 7 0 2 2,30 7 8 9 2,43 8 6 7 2,41 8 7 2 2,36 8 5 5 2,43 8 9 2 2,41 8 0 6 2,36 9 9 3 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

A44 Domestic NonfinancialS tatistics • January 1977 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; half-year figures are at seasonally adjusted annual rates 1975 1976 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 11996677 11996688 11996699 11997700 11997711 11997722 11997733 11997744 11997755 HI H2 HI 1 Nonfinancial sectors 83.9 98.3 93.5 100.7 151.0 176.9 197.6 188.8 210.4 184.2 236.5 242.0 1 2 Excluding equities 81.5 98.3 89.6 94.9 139.6 166.4 190.0 185.0 200.3 173.8 226.9 228.3 2 By sector and/or instrument: 3 U.S. Govt 13.0 13.6 -3.7 11.9 24.7 15.2 8.3 12.0 85.2 80.8 89.6 73.8 3 4 Public debt securities 8.9 10.5 -1.3 12.9 26.0 14.3 7.9 12.0 85.8 82.0 89.7 73.9 4 5 Agency issues and mortgages 4.1 3.1 -2.4 -1.0 -1.3 1.0 .4 * -.6 -1.2 -.1 5 6 All other nonfinancial sectors 70.9 84.8 97.1 88.8 126.3 161.7 189.4 176.8 125.2 103.4 146.9 168.2 6 7 Corporate equities 2.4 * 3.9 5.8 11.5 10.5 7.7 3.8 10.0 10.5 9.6 13.7 7 8 Debt instruments 68.5 84.8 93.3 83.0 114.8 151.2 181.7 173.0 115.1 93.0 137.3 154.5 8 9 Private domestic nonfinancial sectors 66.9 81.9 93.5 86.1 121.1 157.7 183.1 161.6 112.2 94.9 129.4 152.5 9 10 Corporate equities 2.4 -.2 3.4 5.7 11.4 10.9 7.9 4.1 9.9 10.3 9.5 13.3 10 11 Debt instruments 64.5 82.1 90.1 80.4 109.7 146.8 175.3 157.5 102.3 84.6 119.9 139.2 11 12 Debt capital instruments 46.1 51.8 52.5 60.2 86.8 102.8 106.7 101.2 101.3 97.5 105.1 111.8 12 13 State and local obligations 7.8 9.5 9.9 11.2 17.5 15.4 16.3 19.6 17.3 16.2 18.4 18.4 13 14 Corporate bonds 14.7 12.9 12.0 19.8 18.8 12.2 9.2 19.7 27.2 33.4 21.0 20.7 14 Mortgages: 1155 Home 1133..44 1177..33 18.1 14.4 28.6 42.6 46.4 34.6 40.8 33.5 48.1 54.4 15 16 Multifamily residential 3.6 3.4 4.9 6.9 9.7 12.7 10.4 7.0 -.1 * -.2 .9 16 17 Commercial 4.7 6.6 5.7 7.1 9.8 16.4 18.9 15.1 10.9 8.7 13.1 11.5 17 18 Farm 2.0 2.2 1.8 .8 2.4 3.6 5.5 5.1 5.2 5.6 4.8 5.9 18 19 Other debt instruments 18.4 30.2 37.6 20.1 22 8 44.0 68.6 56.3 1.0 -12.8 14.8 27.4 19 20 Consumer credit 4.5 10.0 10.4 5.9 11.6 18.6 21.7 9.8 8.5 1.1 16.0 19.4 20 21 Bank loans n.e.c 9.6 13.8 15.5 6.7 6.5 18.1 34.8 26.2 -14.5 — 23! 5 -5.5 -12.7 21 22 Open market paper 1.7 1.5 1.8 2.6 -.4 .8 2.5 6.8 -2.2 -.2 -4.2 8.1 22 23 Other 2.6 5.0 9.9 5.0 5.1 6.5 9.6 13.5 9.1 9.7 8.5 12.6 23 24 By borrowing sector 66.9 81.9 93.5 86.1 121.1 157.7 183.1 161.6 112.2 94.9 129.4 152.5 24 25 State and local governments 7.9 9.8 10.7 11.3 17.8 15.2 14.8 18.6 14.9 13.9 15.9 16.7 25 26 Households 22.4 32.1 33.8 25.3 42.1 64.8 73.5 45.2 49.7 39.0 60.4 72.8 26 27 Farm 3.3 2.8 3.1 2.3 4.5 5.8 9.7 7.9 9.4 9.4 9.4 11.0 27 28 Nonfarm noncorporate 4.4 5.3 7.5 5.7 10.3 13.1 12.3 6.7 1.2 -.8 3.2 5.2 28 29 Corporate 28.9 31.9 38.4 41.5 46.4 58.8 72.9 83.1 37.1 33.5 40.6 46.8 29 30 Foreign 4.0 2.8 3.7 2.7 5.2 4.0 6.1 15.3 13.0 8.5 17.4 15.7 30 31 Corporate equities .1 .2 .5 .1 * -.4 -.2 -.2 . l .1 .1 .3 31 32 Debt instruments 4.0 2.7 3.2 2.7 5.2 4.4 6.4 15.5 12.8 8.4 17.3 15.3 32 33 Bonds 1.2 1.1 1.0 .9 .9 1.0 1.0 2.1 6.2 5.7 6.7 7.6 33 34 Bank loans n.e.c -.3 -.5 -.2 -.3 2.1 3.0 2.8 4.7 4.0 .6 7.4 3.7 34 35 Open market paper .5 -.2 .3 .8 .3 -1.0 .9 7.1 -. 1 -1.2 1.0 .8 35 36 U.S. Govt, loans 2.6 2.2 2.1 1.3 1.8 1.5 1.7 1.6 2.8 3.3 2.2 3.2 36 37 MEMO: U.S. Govt, cash balance 1.2 -1.2 .5 2.8 3.2 -.3 -1.7 -4.6 2.9 .5 5.2 1100..88 3377 Totals net of changes in U.S. Govt, cash balance: 38 Total funds raised 82.7 99.5 93.0 97.9 147.8 177.2 199.3 193.4 207.5 183.7 231.3 231.2 38 39 By U.S. Govt 11.8 14.8 -4.1 9.1 21.6 15.5 9.9 16.6 82.3 80.3 84.4 63.0 39 40 Financial sectors 2.0 17.2 35.2 15.8 17.0 29.1 56.7 43.0 14.8 15.1 14.6 29.7 40 By instrument: 41 U.S. Govt, related .1 4.0 9.5 9.8 5.9 8.4 19.9 23.1 13.5 14.0 13.1 18.0 41 42 Sponsored credit agencies -.6 3.2 9.1 8.2 1.1 3.5 16.3 16.6 2.3 1.4 3.3 3.9 42 43 Mortgage pool securities .7 .5 .7 1.6 4.8 4.9 3.6 5.8 10.3 11.5 9.2 14.2 43 44 Loans from U.S. Govt — _ 1 .2 -.3 .7 .9 J J 6 * 44 45 Private financial sectors 2.0 13.2 25.8 6.0 11.1 20.7 36.8 19.9 1.3 1.1 1.4 11.7 45 46 Corporate equities 3.1 6.5 6.3 4.8 3.5 2.8 1.5 1.0 1.2 1.2 1.2 .7 46 47 Debt instruments -1.1 6.7 19.5 1.2 7.6 18.0 35.3 18.9 .1 * .3 11.0 47 48 Corporate bonds .1 .4 .8 2.7 3.8 5.1 3.5 2.1 2.9 3.2 2.6 6.1 48 49 Mortgages 1.0 .4 .2 .7 2.1 1.7 -1.2 -1.3 2.3 1.2 3.4 1.2 49 50 Bank loans n.e.c -2.0 1.5 1.5 * 3.5 6.8 14.0 7.5 -3.9 -4.7 -3.2 -2.8 50 51 Open market paper and RP's 1.8 3.4 12.9 -3.5 .9 4.4 11.8 3.9 2.8 7.6 -1.9 8.7 51 52 Loans from FHLB's -2.5 .9 4.0 1.3 -2.7 * 7.2 6.7 -4.0 -7.3 -.6 -2.3 52 By sector: 53 Sponsored credit agencies -.6 3.5 8.8 8.2 1.1 3.5 16.3 17.3 3.2 2.5 4.0 3.9 53 54 Mortgage pools .7 .5 .7 1.6 4.8 4.9 3.6 5.8 10.3 11.5 9.2 14.2 54 55 Private financial sectors 2.0 13.2 25.8 6.0 11.1 20.7 36.8 19.9 1.3 1.1 1.4 11.7 55 56 Commercial banks * .8 2.4 -2.0 2.4 4.8 8.1 -1.1 1.7 6.4 -3.0 11.3 56 57 Bank affiliates 4.3 --11..99 — .4 , 7 2.2 3 5 3 9 _ 3 — 1.3 57 58 Foreign banking agencies * . 1 .2 1.6 .8 5.1 2.9 — .9 .2 — 1.5 58 59 Savings and loan associations -1.7 1.1 4.1 —. 1 2.0 6.0 6.3 -2.1 -7.8 3.6 -.7 59 60 Other insurance companies . 1 .2 .5 .4 .6 .5 .5 .9 .9 .9 1.0 1.0 60 61 Finance companies .6 3.9 7.8 2.6 2.7 6.2 9.4 4.5 .7 -.8 2.1 6.7 61 62 REIT's * 1.2 1.5 2.2 2.9 6.3 6.5 1.1 -1.9 -1.6 -2.2 -1.9 62 63 Open-end investment companies 3.0 5.9 4.9 2.8 1.3 -.5 -1.2 -.5 .8 1.5 .1 -1.1 63 64 Monev market funds 2.4 1.3 2.6 * _ _ 7 64 65 All sectors, by instrument 85.9 115.5 128.7 116.4 168.1 206.0 254.3 231.8 225.2 199.4 251.1 271.7 65 66 Investment company shares 3.0 5.9 4.9 2.8 1.3 -.5 -1.2 -.5 .8 1.5 .1 -1.1 66 67 Other corporate equities 2.5 .6 5.2 7.7 13.7 13.8 10.4 5.4 10.4 10.2 10.7 15.4 67 68 Debt instruments 80.4 109.0 118.6 105.9 153.1 192.8 245.2 227.0 214.0 187.7 240.3 257.4 68 69 U.S. Govt, securities 13.2 17.4 6.2 21.7 30.7 23.7 28.3 34.5 98.0 93.6 102.4 91.8 69 70 State and local obligations 7.8 9.5 9.9 11.2 17.5 15.4 16.3 19.6 17.3 16.2 18.4 18.4 70 71 Corporate and foreign bonds 16.6 14.4 13.8 23.3 23.5 18.4 13.6 23.9 36.3 42.3 30.3 34.4 71 72 Mortgages 24.6 29.8 30.7 29.9 52.5 76.8 79.9 60.5 59.0 49.1 69.0 74.1 72 73 Consumer credit 4.5 10.0 10.4 5.9 11.6 18.6 21.7 9.8 8.5 1.1 16.0 19.4 73 74 Bank loans n.e.c 7.3 14.8 16.8 6.3 12.1 27.8 51.6 38.4 -14.4 -27.6 -1.2 -11.8 74 75 Open market paper and RP's 3.9 4.8 15.1 -. 1 .8 4.1 15.2 17.8 .5 6.2 -5.1 17.7 75 76 Other loans 2.5 8.3 15.8 7.7 4.2 8.0 18.5 22.5 8.7 6.8 10.7 13.5 76 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

Flow of Funds A45 1.58 DIRECT AND INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS Billions of dollars; half-year figures are at seasonally adjusted annual rates 1975 1976 Transaction category, or sector 11996677 11996688 11996699 11997700 11997711 11997722 11997733 11997744 11997755 HI H2 HI 1 Total funds advanced in credit markets to nonfinancial sectors 81.5 98.3 89.6 94.9 139.6 166.4 190.0 185.0 200.3 173.8 226.9 228.3 1 By public agencies and foreign 2 Total net advances 12.0 13.0 16.5 29.2 43.4 19.8 34.2 52.7 44.2 51.9 36.6 56.2 2 3 U.S. Govt, securities 6.9 3.3 .5 15.1 34.4 7.6 9.6 11.9 22.5 32.6 12.4 26.9 3 4 Residential mortgages 2.6 3.3 5.1 6.5 7.0 7.0 8.2 14.7 16.2 15.9 16.5 11.1 4 5 FHLB advances to S&L's -2.5 .9 4.0 1.3 -2.7 * 7.2 6.7 -4.0 -7.3 -.6 -2.3 5 6 Other loans and securities 5.2 5.5 6.9 6.2 4.6 5.1 9.2 19.5 9.5 10.6 8.3 16.9 6 Totals advanced, by sector 7 U.S. Govt 4.7 5.2 3.1 2.8 2.8 1.8 2.8 9.8 15.1 14.9 15.2 5.9 7 8 Sponsored credit agencies .6 3.8 9.4 11.1 5.2 9.2 21.4 25.6 14.5 15.9 13.2 20.0 8 9 Monetary authorities 4.8 3.7 4.2 5.0 8.9 .3 9.2 6.2 8.5 7.0 10.1 13.7 9 10 Foreign • • • 2.0 .3 -.3 10.3 26.4 8.4 .7 11.2 6.1 14.2 -2.0 13.0 10 11 Agency borrowing not included in line 1 4.0 9.5 9.8 5.9 8.4 19.9 23.1 13.5 14.0 13.1 18.0 11 Private domestic funds advanced 12 Total net advances 69.5 89.3 82.5 75.5 102.1 155.0 175.7 155.3 169.6 135.9 203.4 193.8 12 13 U.S. Govt, securities 6.3 14.1 5.6 6.6 -3.7 16.1 18.1 22.6 75.5 61.0 90.0 64.9 13 14 State and local obligations 7.8 9.5 9.9 11.2 17.5 15.4 16.3 19.6 17.3 16.2 18.4 18.4 14 15 Corporate and foreign bonds 16.0 13.8 12.5 20.0 19.5 13.1 10.0 20.9 32.8 38.9 26.7 27.3 15 16 Residential mortgages 14.4 17.3 17.9 14.7 31.2 48.1 48.5 26.9 24.4 17.7 31.1 44.3 16 17 Other mortgages and loans 22.4 35.5 40.7 24.3 35.0 62.3 89.3 71.9 15.7 -5.2 36.5 36.6 17 18 Less: FHLB advances -2.5 .9 4.0 1.3 -2.7 * 7.2 6.7 -4.0 -7.3 -.6 -2.3 18 Private financial intermediation 2 1 0 9 Cr C ed o i i m n t s m m ti a t e u r r t k c i e o ia t n l s fu b n an ds k s a dvanced by private financial 6 3 3 5 . . 4 8 3 75 8 . . 5 7 5 1 7 8 . . 4 6 7 3 7 5 . . 0 0 10 5 9 0 . . 7 6 14 7 9 0 . . 4 5 1 8 6 6 3 . . 5 8 1 6 2 4 6 . . 6 2 1 2 1 1 6 . . 6 0 9 1 7 3 . . 7 5 1 4 3 1 4 . . 1 3 1 2 3 2 9 . . 1 2 2 1 0 9 21 Savings institutions 15.0 15.4 14.6 17.4 39.1 47.2 36.0 27.0 51.0 49.8 52.2 68.0 21 22 Insurance and pension funds 12.9 13.8 13.3 17.1 14.2 17.8 23.8 30.1 39.3 36.4 42.3 43.9 22 23 Other finance -.3 7.6 10.8 7.5 5.9 13.8 17.4 4.5 -1.8 -1.9 -1.8 5.1 23 2 2 2 4 5 6 So C P u r r r c i e v e d a s i t t e o m f d f a o u r m n k d e e s s t t b ic o r d r e o p w o i s n it g s 1 - 6 4 1 3 9 . . 1 4 .8 4 7 6 5 5. . . 5 9 7 5 1 7 2 9 . . . 4 3 5 6 77 0 1 . . . 0 7 2 10 8 9 7 9 . . . 7 6 4 1 1 4 0 1 9 0 8 . . . 4 9 0 16 8 3 3 6 5 . . . 8 4 3 1 6 2 1 6 9 8 . . . 2 4 9 1 9 16 0 . . - 0 1 5 9 97 0 . . 7 3 * 1 9 3 0 4. . . 3 6 3 1 9 3 1 9 0 1 . . . 2 9 0 2 2 2 4 5 6 2 2 2 3 3 8 9 7 0 1 Ot I T O F h n o e r t s e r h r u a e e r s s i r o a g u , u n n r n r c y c e e f u e t b s a n a n d la d s n p ce e s n sion reserves 1 1 2 4 1 . . . . . 7 3 2 8 4 2 1 - 9 2 2 1 . . 2 . . . 9 1 6 4 3 1 1 9 5 5 0 . . . . 6 6 1 8 * - 1 1 8 2 7 5 3 . . . . 1 . 1 9 1 3 - 1 3 2 2 5 8 . . . . . 9 6 7 6 2 3 1 1 0 5 2 1 . . . . . 5 3 7 8 6 - 4 1 1 1 2 6 7 8 . . . 0 . . 1 9 8 4 - 3 2 5 1 7 . 2 6 4 1 . . . . 8 4 5 0 - - 2 2 1 2 - 5 9 . . . . 4 . 7 4 4 9 -1 - - 5 2 3 0 . 7 7 1 . . . . 5 8 4 4 4 3 3 5 5 2 . . . . . 4 0 9 5 1 3 3 — 7 3 2 1 . . . . . 3 5 7 2 1 2 2 2 3 3 7 8 9 1 0 3 3 3 3 3 3 4 5 2 3 6 7 P D r i C i C S O U r v e t o o a t . c a S h r m t t t e . e p e l m r o G e d a r n e o n o a d r m d v t c i e n t i e , l a g s o a l s t c n i i e p n c a d c l a u n c p f o r r o o e e b i n r r t d l f i e i i i e g i t n s g a a . m n t n i . a o c b . r i n o a k s n l e d t i s n s vestors - - 1 2 4 4 2 1 . . . . . 1 6 . 9 0 8 8 2 - 4 0 4 8 3 . . 1 . . . . 5 2 2 6 6 4 1 1 4 5 8 3 7 0 . . . . . . 6 4 2 6 5 0 - - - — 5 1 7 9 3 . . . . 1 1 3 . 5 7 . 3 -1 -1 0 8 3 . . 1 . . . 8 3 2 5 * 23 4 9 4 3 3 . . . . . . 6 1 2 2 1 0 4 1 1 7 6 7 9 2 . . . . . . 2 9 5 9 5 4 4 1 1 8 4 5 8 7 2 . . . . . . 0 6 3 1 9 2 5 2 1 3 9 7 3 3 0 . . . . . . 7 9 1 3 0 4 3 1 1 8 5 3 5 0 3 . . . . . . 1 5 6 0 3 6 6 4 9 2 9 8 7 1 . . . . . . 4 7 6 9 2 0 6 2 1 1 5 6 7 9 0 2 . . . . . . 6 0 7 5 2 2 3 3 3 3 3 3 2 7 5 6 4 3 38 Deposits and currency 51.8 48.5 5.1 64.2 92.8 105.3 90.3 75.7 96.7 95.7 97.7 95.1 38 39 Time and saving accounts 38.8 33.7 -2.2 55.3 79.1 83.7 76.2 67.4 84.8 75.0 94.7 82.3 39 40 Large negotiable CD's 4.3 3.5 -13.7 15.0 7.7 8.7 18.4 23.6 -9.7 -22.3 2.9 -23.5 40 41 Other at commercial banks 17.9 17.2 3.1 23.6 31.8 29.7 29.4 21.4 35.4 34.4 36.4 39.9 41 42 At savings institutions 16.6 13.0 8.4 16.6 39.6 45.4 28.4 22.4 59.2 63.0 55.4 66.0 42 43 Money 13.0 14.8 7.5 8.9 13.7 21.6 14.1 8.3 11.9 20.7 3.0 12.7 43 44 Demand deposits 11.0 12.3 4.5 5.4 10.4 17.2 10.2 2.0 5.1 15.3 -4.0 8.5 44 2.0 2.5 2.8 3.5 3.4 4.4 3.9 6.3 6.2 5.4 7.1 4.2 45 45 Currency 56.8 69.0 49.8 63.9 92.9 129.0 137.5 123.7 150.4 133.8 167.1 160.7 46 46 Total of credit market instr., deposits, and currency 14.8 13.2 18.4 30.7 31.1 11.9 18.0 28.5 22.1 29.9 16.1 23.0 47 44 4 78 9 PP T rr o ii t vv a aa l t tee fo sf r iu e np i a g pn n oc ri f at u l n r ia d nt s te e r(imn epdeira tcioennt )( in per cent). . . 9 4 1 . . 3 2 8 2 4 . . 9 6 6 9 9 . . 4 5 10 2 2 . . 2 0 1 2 0 2 7 . . 5 4 9 1 6 3 . . 4 7 9 7 3 . . 6 2 2 8 5 1 . . 7 2 6 5 8 . . 7 4 7 8 1 . . 5 9 6 3 6 . . 0 0 7 1 1 3 . . 8 0 4 4 9 8 MEMO: Corporate equities not included above 50 Total net issues 5.6 6.5 10.1 10.5 15.0 13.3 9.2 4.9 11.2 11.7 10.8 14.3 1 51 Mutual fund shares 3.0 5.9 4.9 2.8 1.3 -.5 -1.2 -.5 .8 1.5 . 1 — 1.1 2 52 Other equities 2.5 .6 5.2 7.7 13.7 13.8 10.4 5.4 10.4 10.2 10.7 15.4 3 53 Acquisitions by financial institutions 9.1 10.9 13.0 10.6 17.8 15.3 13.3 5.5 8.3 9.2 7.4 11.7 4 54 Other net purchases -3.5 -4.4 -2.9 -.1 -2.9 -2.1 -4.1 -.7 2.9 2.4 3.4 2.6 5 Notes by line no. 29. Demand deposits at commercial banks. 1. Line 2 of p. A-44. 30. Excludes net investment of these reserves in corporate equities. 2. Sum of lines 3-6 or 7-10. 31. Mainly retained earnings and net miscellaneous liabilities. 6. Includes farm and commercial mortgages. 32. Line 12 less line 19 plus line 26. 11. Credit market funds raised by Federally sponsored credit agencies. 33-37. Lines 13-17 less amounts acquired by private finance. Line 37 Included below in lines 13 and 33. Includes all GNMA-guaranteed includes mortgages. 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 50. 52. Includes issues by financial institutions. line 18. 28. Foreign deposits at commercial banks, bank borrowings from foreign branches, and liabilities of foreign banking agencies to foreign affiliates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • January 1977 2.10 SELECTED MEASURES OF NONFINANCIAL BUSINESS ACTIVITY 1967 = 100 except as noted; monthly and quarterly data are seasonally adjusted 1976 Measure 1973 1974 1975 May June July Aug. Sept. Oct. Nov.f Dec.e 1 Industrial production, total 129.8 129.3 117.8 129.6 130.1 130.7 131.3 130.8 130.4 131.9 132.8 Market groupings : 2 Products, total 127.1 129.3 119.3 128.9 129.5 129.8 130.3 129.7 129.7 131.6 133.1 3 Final, total 124.4 125.1 118.2 127.3 127.6 127.6 128.3 127.4 127.3 129.5 131.2 4 Consumer goods 131.5 128.9 124.0 137.4 137.8 136.8 137.5 136.2 136.9 138.7 141.1 5 Equipment 114.5 120.0 110.2 113.5 113.8 114.9 115.7 115.2 114.4 116.7 117.7 6 Intermediate 137.2 135.3 123.1 135.0 135.9 137.6 137.8 138.7 138.4 139.3 140.4 7 Materials 133.9 132.4 115.5 130.6 131.1 132.2 133.0 132.5 131.6 132.3 132.3 Industry groupings: 8 Manufacturing 129.8 129.4 116.3 129.6 130.2 131.0 131.6 130.7 130.0 131.8 132.6 Capicity utilization (per cent)1 in— 9 Manufacturing 87.5 84.2 73.6 80.3 80.5 80.9 81.1 80.4 79.7 80.7 10 Industrial materials industries 92.4 87.7 73.6 80.8 80.8 81.2 81.6 81.0 80.4 81.0 11 Construction contracts2 179.5 169.7 166.0 205.0 187.0 186.0 186.0 182.0 237.0 186.0 Nonagricultural employment:3 12 Total 116.8 119.1 116.9 119.8 119.9 120.2 120.4 120.8 120.7 121.0 121.4 13 Goods-producing, total 106.3 106.2 96.9 99.4 99.2 99.3 99.2 99.9 99.4 14 Manufacturing, total 103.2 103.1 94.3 97.5 97.4 97.4 97.6 98.2 97.4 98.0 98.2 15 Manufacturing, production-worker 103.1 102.1 91.3 95.4 95.2 95.2 95.2 96.1 94.9 95.6 95.8 16 Service-producing 122.5 126.1 127.8 131.0 131.1 131.7 132.1 132.2 132.4 Personal income:4 17 Total 168.0 184.1 199.4 217.5 218.7 220.4 221.1 222.1 223.9 226.3 Wages and salary disbursements: 18 Total 164.0 178.9 188.7 206.6 206.6 208.8 209.9 211.3 213.2 215.6 19 Manufacturing 146.3 157.6 157.9 175.8 176.1 177.5 178.1 178.9 179.1 182.5 20 Disposable personal income4 165.6 180.5 198.5 217.2 217.0 21 Retail sales 5 160.2 171.2 186.1 202.0 206.3 205.4 208.8 206.7 208.8 212.7 219.2 Prices:6 22 Consumer 133.1 147.7 161.2 169.2 170.1 171.1 171.9 172.6 173.3 173.8 23 Wholesale 134.7 160.1 174.1 181.8 183.1 184.3 183.7 184.7 185.2 185.6 187.1 1 Ratios of indexes of production to indexes of capacity. Based on data 5 Based on Bureau of Census data published in Surrey of Current from Federal Reserve, McGraw-Hill Economics Department and De- Business (U.S. Dept. of Commerce). partment of Commerce. 6 Data without seasonal adjustment, as published in Monthly Labor 2 Index of dollar value of total construction contracts, including Review (U.S. Dept. of Labor). Seasonally adjusted data for changes in residential, nonresidential, and heavy engineering, from McGraw-Hill the price indexes may be obtained from the Bureau of Labor Statistics, Informations Systems Company, F. W. Dodge Division. U.S. Dept. of Labor. 3 Based on data in Employment and Earnings (U.S. Dept. of Labor). Series covers employees only, excluding personnel in the Armed Forces. NOTE.—Basic data (not index numbers) for series mentioned in notes 4 Based on data in Survey of Current Business (U.S. Dept. of Com- 3, 4, and 5, and indexes for series mentioned in notes 2 and 6 may also be merce). Series for disposable income is quarterly. found in the Survey of Current Business (U.S. Dept. of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Capacity and Manpower A47 2.11 OUTPUT, CAPACITY, and CAPACITY UTILIZATION Seasonally adjusted 1976 1976 1976 Series Q1 Q2 Q3 Q4 Ql Q2 Q3 Q4 Ql Q2 Q3 Q4 Output Capacity Utilization rate (1967 == 100) (per cent of 1967 output) (per cent) 1 Manufacturing 126.7 129.4 131.1 131.5 160.4 161.3 162.3 163.2 79.0 80.2 80.8 80.5 2 Primary processing 133.4 136.6 139.3 138.7 166.2 167.5 168.8 170.1 80.2 81.5 82.5 81.5 3 Advanced processing 122.9 125.2 126.3 127.6 157.2 158.0 158.8 159.6 78.2 79.2 79.6 80.0 126.9 130.3 132.5 132.1 160.6 161.7 163.1 164.3 79.0 80.6 81.3 80.4 5 Durable goods 120.8 126.1 130.7 128.6 164.4 165.5 166.7 167.8 73.5 76.2 78.4 76.6 6 Basic metal 103.7 110.8 117.1 107.3 142.4 143.1 143.7 144.4 72.8 77.4 81.5 74.3 7 Nondurable goods 145.0 146.9 146.7 147.9 169.4 171.0 172.5 174.1 85.6 85.9 85.0 85.0 8 Textile, paper and chemical 150.2 151.6 151.3 152.4 176.5 178.3 180.1 182.0 85.1 85.0 84.0 83.8 9 Textile 116.5 115. 5 114.8 111.1 138.2 139.0 139.8 140.6 84.3 83.1 81.8 79.0 10 Paper 128.9 132.5 131.9 131.3 144.6 145.7 146.7 147.9 89.1 90.9 89.9 88.8 11 Chemical 173.6 175.3 175.1 179.2 206.2 208.7 211.2 213.7 84.2 84.0 82.9 83.9 12 Energy 119.7 120.0 119.7 121.0 140.3 141.5 142.7 143.9 85.3 84.8 84.0 84.1 2.12 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data, seasonally adjusted; exceptions noted 1976 CCaatteeggoorryy 11997733 11997744 11997755 June July Aug. Sept. Oct. NOV.P Dec.f 1 Noninstitutional population1 148,263 150,827 153,449 155,925 156,142 156,367 156,595 156,788 157,006 157,176 2 Labor force (including Armed Forces)1 91,040 93,240 94,793 96,780 97,473 97,634 97,348 97,489 98,048 98,056 3 Civilian labor force 88,714 9911,,001111 92,613 94,643 95,333 95,487 95,203 95,342 95,899 95,910 Employment: 4 Nonagricultural industries2 80,957 82,443 81,403 84,206 84,566 84,557 84,533 84,444 84,898 85,120 5 Agriculture 33,,445522 3,492 3,380 3,294 3,341 3,424 3,286 3,329 3,232 3,232 Unemployment: 6 Number 44,,330044 55,,007766 7,830 7,143 7,426 7,506 7,384 7,569 7,769 7,558 7 Rate (per cent of civilian labor force) 4.9 5.6 8.5 7.5 7.8 7.9 7.8 7.9 8.1 7.9 8 Not in labor force SI,222 57,587 58,655 59,145 58,669 58,733 59,248 59,300 58,958 59,121 9 Employment in nonagricultural establishments3 78,896 78,413 76,985 79,805 79,183 79,278 79,572 79,467 79,700 79,957 By industry division: 10 Manufacturing 20,068 20,046 18,347 19,117 18,945 18,979 19,100 18,941 19,057 19,903 11 Mining 644 694 745 795 791 752 798 800 808 806 12 Contract construction 4,015 3,957 3,457 3,523 3,382 3,349 3,300 3,340 3,353 3,349 13 Transportation and public utilities . 4,644 4,696 4,498 4,531 4,508 4,501 4,528 4,506 4,510 4,537 14 Trade 16,674 17,017 16,947 17,552 17,531 17,554 17,625 17,610 17,585 17,685 15 Finance 4,091 4,208 4,223 4,297 4,312 4,312 4,338 4,359 4,381 4,403 16 Service 13,021 13,617 13,995 14,775 14,623 14,696 14,758 14,781 14,844 14,897 17 Government 13,739 14,177 14,773 15,168 15,091 15,122 15,095 15,130 15,162 15,187 1 Persons 16 years of age and over. Monthly figures, which are based 3 Data include all full- and part-time employees who worked during, on sample data, relate to the calendar week that contains the 12th day; or received pay for, the pay period that includes the 12th day of the annual data are averages of monthly figures. By definition, seasonality month, and exclude proprietors, self-employed persons, domestic servants, does not exist in population figures. From Employment and Earnings (U.S. unpaid family workers, and members of the Armed Forces. Data are Dept. of Labor). adjusted to the March 1975 benchmark. From Employment and Earnings 2 Includes self-employed, unpaid family, and domestic service workers. (U.S. Dept. of Labor). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 Domestic Nonfinancial Statistics • January 1977 2.13 INDUSTRIAL PRODUCTION Unless otherwise noted, figures are indexes (1967 = 100); monthly data are seasonally adjusted 1967 1975 1975 1976 Grouping pro- averpor- age tion Oct. Nov. Dec. July Aug. Sept. Oct. Nov.f Dec.f Major market groupings 1 Total index 100.00 117.8 122.2 123.5 124.4 130.7 131.3 130.8 130.4 131.9 132.8 2 Products 60.71 119.3 122.4 123.8 124.9 129.8 130.3 129.7 129.7 131.6 133.1 3 Final products 47.82 118.2 120.9 122.3 123.5 127.6 128.3 127.4 127.3 129.5 131.2 4 Consumer goods 27.68 124.0 128.7 131.1 132.3 136.8 137.5 136.2 136.9 138.7 141.1 5 Equipment 20.14 110.2 110.0 110.0 111.5 114.9 115.7 115.2 114.4 116.7 117.7 6 Intermediate products 12.89 123.1 128.0 129.3 129.9 137.6 137.8 138.7 138.4 139.3 140.4 7 Materials 39.29 115.5 122.0 123.1 123.3 132.2 133.0 132.5 131.6 132.3 132.3 Consumer goods: 8 Durable consumer goods 7.89 121.4 131.9 132.5 134.0 141.8 143.7 138.4 138.6 143.7 150.1 9 Automotive products 2.83 125.9 140.8 143.2 147.7 155.9 158.4 147.4 147.7 161.9 178.1 10 Autos and utility vehicles.... 2.03 113.7 133.6 134.7 140.0 155.9 158.2 139.1 138.4 155.8 178.4 11 Autos 1.90 101.1 119.1 120.9 122.8 135.0 137.7 120.9 121.5 139.1 159.7 12 Auto parts and allied goods... .80 156.6 159.0 164.9 167.0 156.0 158.4 168.6 171.2 177.4 177.8 13 Home goods 5.06 118.8 127.0 126.5 126.4 133.8 135.6 133.3 133.5 133.5 134.3 14 Appliances, A/C, and TV 1.40 98.0 105.3 100.9 101.1 110.3 119.1 111.4 113.3 112.6 112.8 15 Appliances and TV 1.33 100.2 109.3 103.7 104.4 114.1 121.9 115.1 117.1 116.2 117.0 16 Carpeting and furniture 1.07 126.8 141.9 144.7 142.0 142.0 145.0 146.3 147.0 145.7 17 Misc. home goods 2.59 126.9 132.6 132.9 133.6 143.0 140.7 139.8 138.8 139.9 114411..22 18 Nondurable consumer goods 19.79 125.1 127.4 130.6 131.5 134.8 134.9 135.3 136.3 136.8 137.4 19 Clothing 4.29 111 6 120.4 123.2 123.9 126.3 123.2 123.0 125.1 20 Consumer staples 15.50 128.8 129.3 132.5 133.6 137.2 138.1 138.7 139.4 140.0 140.7 21 Consumer foods and tobacco 8.33 122.8 125.3 127.6 127.2* 131.4 131.9 133.0 134.7 133.6 22 Nonfood staples 7.17 135.8 133.8 138.2 141.0 143.9 145.3 145.4 144.6 147.4 149.3 23 Consumer chemical products. 2.63 151.3 149.8 157.8 159.7 166.2 168.8 169.2 168.3 172.0 24 Consumer paper products. . . 1.92 107.0 104.4 107.5 113.4 112.8 113.9 111.9 110.9 114.0 25 Consumer energy products. . 2.62 141.6 139.2 140.9 142.8 144.1 144.8 145.9 145.5 147.5 26 Residential utilities 1.45 152.3 148.6 152.0 152.0 150.4 154.3 154.4 Equipment: 27 Business equipment 12.63 128.2 128.8 129.6 131.6 136.9 137.7 137.5 136.0 139.5 140.9 28 Industrial equipment 6.77 121.2 122.1 123.0 124.5 127.5 128.1 129.8 130.4 130.6 131.9 29 Building and mining equip... 1.44 168.3 172.9 174.9 172.9 176.9 179.8 180.4 179.8 179.9 181.0 30 Manufacturing equipment. .. 3.85 99.9 100.5 99.9 101.3 107.2 107.2 108.6 109.1 109.0 109.6 31 Power equipment 1.47 130.8 128.9 132.3 137.6 132.6 132.0 135.6 137.8 138.9 142.1 32 Commercial transit, farm equip, 5.86 136.3 136.4 137.2 139.7 147.7 148.7 146.1 142.5 150.0 151.3 33 Commercial equipment 3.26 157.8 158.5 159.5 164.4 174.1 176.2 176.8 177.5 179.8 181.6 34 Transit equipment 1.93 101.9 102.4 102.8 102.9 107.6 106.6 99.3 97.5 106.0 107.0 35 Farm equipment .67 130.6 126.6 127.7 125.6 135.3 136.8 131.4 102.0 131.6 36 Defense and space equipment 7.51 80.0 78.5 77.3 77.7 78.0 78.6 77.7 78.5 78.3 78.6 Intermediate products: 37 Construction supplies 6.42 116.3 122.7 123.1 124.1 133.1 134.1 134.3 134.1 135.5 137.4 38 Business supplies 6.47 129.8 133.3 135.4 135.9 142.1 141.5 143.0 142.6 142.9 39 Commercial energy products... 1.14 150.6 147.5 149.8 147.9 159.1 156.4 156.4 155.7 157.0 Materials: 40 Durable goods materials 20.35 109.1 114.6 115.2 115.5 130.6 131.4 130.0 128.5 129.1 128.1 41 Durable consumer parts 4.58 97.7 107.2 109.3 111.6 126.1 125.1 123.5 119.4 126.0 125.4 42 Equipment parts 5.44 118.9 120.6 122.3 123.9 136.3 138.0 138.3 138.0 138.3 139.0 43 Durable materials n.e.c 10.34 109.0 114.8 114.0 112.9 129.8 130.6 128.4 127.5 125.6 123.7 44 Basic metal materials 5.57 99.1 99.5 99.5 96.1 117.5 120.0 113.9 111.9 107.3 45 Nondurable goods materials 10.47 126.6 140.3 141.3 142.6 146.0 146.1 147.8 147.0 148.1 148.6 46 Textile, paper, and chem. mat.. 7.62 129.0 144.9 146.2 147.9 150.5 150.6 152.6 151.8 152.4 153.1 47 Textile materials 1.85 100.6 117.3 118.4 118.9 114.7 114.9 113.6 112.6 109.9 48 Paper materials 1.62 113.2 121.6 124.4 125.9 132.1 132.7 131.0 132.1 130.9 49 Chemical materials 4.15 147.9 166.3 167.2 169.5 173.8 173.4 178.2 177.3 179.8 50 Containers, nondurable 1.70 127.9 137.3 134.8 136.1 142.8 143.2 143.5 141.7 145.5 51 Nondurable materials n.e.c 1.14 108.3 114.3 118.4 116.7 120.4 121.2 122.8 122.8 122.7 52 Energy materials 8.48 117.2 117.0 119.7 118.7 119.5 120.5 119.6 120.1 120.7 122.2 53 Primary energy 4.65 108.3 109.6 110.5 107.3 106.9 107.9 108.4 109.8 109.5 54 Converted fuel materials 3.82 128.0 125.9 130.8 132.3 134.6 136.0 133.2 132.7 134.4 Supplementary groups: 55 Home goods and clothing 9.35 115.5 124.0 125.0 125.2 130.3 129.9 128.7 129.6 129.6 130.1 56 Energy, total 12.23 125.5 124.5 127.1 126.6 128.4 129.0 128.6 128.8 129.8 131.4 57 Products 3.76 144.3 141.8 143.7 144.5 148.7 148.2 149.1 148.7 150.3 58 Materials 8.48 117.2 117.0 119.7 118.7 119.5 120.5 119.6 120.1 120.7 For NOTES see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Output A49 2.13 Continued 1967 1975 1976 SIC pro- 1975 Grouping code por- avertion age Oct. Nov. Dec. July Aug. Sept. Oct. Nov.f Dec.e Gross value of products in market structure (Annual rates, in billions of 1972 dollars) Products, total . 1286.3 505.9 521.1 527.1 528.4 552.6 556.4 548.8 549.1 559.9 570.2 Final products U21.4 393.3 404.0 409.7 410.6 427.8 431.3 422.2 422.8 432.7 442.6 Consumer goods. 1156.3 274.4 285.0 290.5 292.0 302.2 304.6 300.7 302.1 307.7 314.7 Equipment 165.3 119.0 119.1 119.3 118.9 125.8 126.7 121.7 120.7 125.3 127.9 5 Intermediate products. 164.9 112.6 116.6 117.6 117.9 124.7 125.1 126.6 126.4 127.2 127.8 Major industry groupings 6 Mining and utilities. 12.05 128.5 127.9 130.5 129.2 130.6 131.8 131.9 133.1 133.3 134.7 1 Mining 6.36 112.8 113.8 114.2 112.9 112.5 114.4 115.7 117.4 116.8 116.8 8 Utilities 5.69 146.0 143.8 148.8 147.2 150.8 151.3 150.1 150.8 151.9 154.4 9 Electric 3.88 160.8 157.3 165.5 162.3 167.2 168.5 167.8 168.2 10 Manufacturing. 87.95 116.3 121.2 122.7 123.6 131.0 131.6 130.7 130.0 131.8 132.6 11 Nondurable. 35.97 126.4 133.6 136.2 136.9 141.1 140.9 142.6 142.3 143.4 144.2 12 Durable 51.98 109.3 112.7 113.4 114.4 124.2 125.1 122.4 121.4 123.8 124.7 Mining: 13 Metal mining 10 .51 115.8 112.5 118.1 117.9 121.6 127.5 123.6 127.4 129.7 14 Coal 11, 12 .69 113.4 112.2 125.6 109.9 104.8 112.6 121.3 132.3 125.1 123.5 15 Oil and gas extraction 13 4.40 113.3 113.1 112.3 113.1 112.0 112.3 113.3 113.6 113.4 113.7 16 Stone and earth minerals. 14 .75 107.0 110.9 112.1 111.5 116.5 119.0 119.2 120.0 121.2 Nondurable manufactures: 17 Foods 20 8.75 123.4 126.4 128.8 128.5 131.8 133.4 135.7 136.1 135.8 18 Tobacco products 21 .67 111.8 113.9 118.5 116.0 114.5 114.8 115.4 118.3 19 Textile mill products 22 2.68 112.3 137.5 141.6 139.0 136.8 135.1 135.7 134.2 ' i32!8 20 Apparel products 23 3.31 107.6 115.9 118.3 121.2 125.6 123.7 122.5 126.6 21 Paper and products 26 3.21 116.3 126.5 127.7 129.5 132.0 134.6 132.1 132.3 132.4 132.3 22 Printing and publishing 27 4.72 113.4 113.2 115.4 118.4 122.0 120.6 120.6 119.2 121.3 122.0 23 Chemicals and products.... 28 7.74 147.3 157.5 161.9 163.3 167.6 170.4 170.5 170.1 172.8 24 Petroleum products 29 1.79 124.1 125.1 124.9 126.3 134.1 133.8 134.1 129.4 134.0 136'.i' 25 Rubber & plastic products. 30 2.24 166.7 185.1 185.2 185.3 191.2 186.1 212.4 208.9 213.0 26 Leather and products 31 .86 76.5 85.8 87.7 83.2 81.1 77.3 77.9 77.2 75.5 Durable manufactures: 27 Ordnance, pvt. & govt.. 19,91 3.64 76.6 72.0 70.0 70.1 74.0 73.9 73.2 73.3 73.3 73.5 28 Lumber and products.. 24 1.64 107.6 116.8 114.1 116.4 124.6 128.1 128.7 130.7 131.7 29 Furniture and fixtures. , 25 1.37 118.2 127.9 128.7 130.3 131.6 134.4 133.0 134.5 134.3 30 Clay, glass, stone prod. 32 2.74 117.9 127.8 127.5 129.4 137.2 138.1 138.4 138.4 140.5 31 Primary metals 33 6.57 96.4 95.4 92.6 116.9 118.6 114.1 109.8 106.7 100.4 32 Iron and steel 4.21 95.8 92.0 96.5 89.1 115.3 116.2 110.3 105.1 102.7 96.6 33 Fabricated metal prod... 24 5.93 109.9 114.4 116.3 117.3 124.6 125.8 126.6 123.5 126.2 126.6 34 Nonelectrical machinery. 35 9.15 125.1 125.4 126.6 128.6 135.0 136.4 136.8 134.4 137.2 138.0 35 Electrical machinery 36 8.05 116.5 120.1 120.1 122.7 131.0 133.3 133.7 134.8 135.6 137.0 36 Transportation equip 37 9.27 97.4 104.4 104.7 106.7 113.3 115.0 104.4 104.3 113.0 120.0 37 Motor vehicles & pts 4.50 111.1 126.5 127.1 130.1 148.5 150.6 130.2 128.3 145.6 159.3 38 Aerospace & misc. tr. eq.. . 4.77 84.5 83.6 83.6 84.7 80.3 81.5 80.1 81.6 82.3 83.0 39 Instrument 2.11 132.3 136.0 136.4 140.9 151.3 149.6 148.7 150.3 150.4 152.0 40 Miscellaneous mfrs 1.51 128.3 134.6 137.6 137.3 148.5 142.1 143.8 142.6 143.2 144.0 l 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 Domestic Nonfinancial Statistics • January 1977 2.14 HOUSING AND CONSTRUCTION Monthly figures at annual rates; exceptions noted 1976 1973 1974 1975 Item May June July Aug. Sept. Oct. Nov. Private residential real estate activity (Thousands of units; monthly figures, seasonally adjusted; exceptions noted) NEW UNITS 1 Permits authorized 1,820 1,074 926 1,158 1,150 1,215 1,296 1,504 1,492 1,585 2 1-family 882 644 669 807 829 810 874 926 998 1,085 3 2-or-more-family 937 431 277 351 321 345 422 578 494 500 A Started 2,045 1,338 1,160 1,422 1,510 1,382 1,537 1,840 1,813 1,705 5 1-family 1,132 888 892 1,065 1,139 1,123 1,171 1,280 1,340 1,237 6 2-or-more-family 913 450 268 357 371 259 366 560 473 468 7 Under construction (end of period) 1,599 11,,118899 1,003 11,,005555 1,064 1,063 1,074 11,,110077 11,,114433 8 1-family 583 551166 531 660033 609 615 622 664411 666666 9 2-or-more-family 1,016 673 All 452 455 448 452 467 478 10 Completed 22,,001144 1,692 1,297 1,360 1,373 1,307 111,,,444000111 1,390 111,,,333111777 11 1-family 11,,117744 931 866 934 1,052 1,038 111,,,000999444 11,,002233 999666888 12 2-or-more-family 840 760 430 426 321 269 333000777 336677 13 Mobile homes shipped 567 329 213 260 233 224 252 255 269 244 Merchant builder activity in 1-family units: 14 Number sold 620 501 544 540 589 606 640 744 729 696 15 Number for sale (end of period) 456 407 383 400 406 411 406 415 419 430 Price (thous. dollars)1 Median: 16 Units sold 32.5 35.9 39.3 43.6 46.1 44.6 44.2 44.8 45.5 46.1 17 Units for sale 32.9 36.2 38.9 40.2 40.5 40.7 40.8 40.9 41.0 41.2 Average: 18 Units sold 35.5 38.9 42.6 47.6 49.2 48.0 48.5 48.4 50.6 50.5 EXISTING UNITS (1-family) 19 Number sold 2,334 2,272 2,452 2,810 2,990 2,900 3,070 3,330 3,290 3,320 Price of units sold (thous. dollars):1 20 Median 28.9 32.0 35.3 37.6 38.6 38.9 39.4 38.7 38.5 38.8 21 Average 32.9 35.8 39.0 41.9 41.9 43.2 43.4 42.7 42.4 42.9 Value of new construction,2 (Millions of dollars; monthly figures, seasonally adjusted) CONSTRUCTION 22 Total put in place 137,917 138,526 132,043 143,393 145,403 141,055 142,031 146,281 146,743 150,187 23 Private 105,412 100,179 93,034 107,179 106,487 104,288 104,682 108,650 112,780 116,252 24 Residential 59,727 50,378 46,476 58,812 58,685 57,176 55,427 58,701 63,452 66,575 25 Nonresidential, total 45,685 49,801 46,558 48,367 47,802 47,112 49,255 49,949 49,328 49,677 Buildings: 26 Industrial 6,243 7,902 8,017 6,967 6,738 6,097 6,902 6,894 6,407 6,531 27 Commercial 15,453 15,945 12,804 12,331 12,006 12,574 12,984 12,786 12,560 12,449 28 Other 5,888 5,797 5,585 5,967 6,229 6,178 6,689 6,669 6,489 6,819 29 Public utilities and other.... 18,101 20,157 20,152 23,102 22,829 22,263 22,680 23,600 23,872 23,878 30 Public 32,505 38,347 39,009 36,214 38,916 36,767 37,349 37,631 33,963 33,935 31 Military 1,166 1,188 1,391 1,423 1,368 1,448 1,439 1,352 1,374 1,518 32 Highway 10,505 12,069 10,345 9,901 10,292 8,297 9,596 8,856 8,964 33 Conservation and development 2,313 2,741 3,227 3,546 3,674 3,573 4,046 4,281 3,038 34 Other 18,521 22,349 24,046 21,344 23,582 23,449 22,268 23,142 20,587 1 Not seasonally adjusted. NOTE.—Census Bureau estimates for all series except (a) mobile 2 Value of new construction data in recent periods may not be strictly homes, which are private, domestic shipments as reported by the Manucomparable with data in prior periods due to changes by the Bureau of factured Housing Institute and seasonally adjusted by the Census Bureau the Census in its estimating techniques. For a description of these changes and (b) sales and prices of existing units, which are published by the see Construction Reports (C-30-76-5), issued by the Bureau in July 1976. National Association of Realtors. All back and current figures are available from originating agency. Permit authorizations are for 14,000 jurisdictions reporting to the Census Bureau. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Prices A51 2.15 CONSUMER AND WHOLESALE PRICES Percentage changes based on seasonally adjusted data, except as noted Index 12 months to— 3 months (at annual rate) to— 1 month to level Nov. 11997766 Item 1975 1976 1976 ((11997766 1975 1976 == 110000)) Nov. Nov. Sept. Dec. Mar. June July Aug. Sept. Oct. Nov. Consumer prices 1 All items 7.3 5.0 7.4 7.3 2.9 6.1 .5 .5 .4 .3 .3 173.8 2 Commodities 6.7 3.4 7.8 5.9 -1.2 6.3 .4 .5 .2 .3 .2 167.7 3 Food 7.2 .7 8.0 8.3 -7.9 7.2 # 1 .3 .3 -.2 181.1 4 Commodities less food 6.5 5.0 7.5 4.3 2.9 5.6 .6 .6 .4 .4 .4 160.3 5 Durable 8.1 5.9 6.2 4.4 6.9 6.5 .6 .5 .4 .3 .4 158.0 6 Nondurable 5.4 4.4 8.2 4.2 .8 4.7 .6 .8 .4 .4 .5 161.9 8.4 7.6 7.4 9.3 10.6 6.2 .6 .6 .5 .5 .4 185.1 8 Rent 5.1 5.4 4.8 6.5 5.5 5.1 .5 .3 .5 .5 .4 147.5 9 Services less rent 8.8 7.9 7.7 9.7 11.7 6.2 .6 .5* .6 .6 .4 191.8 Other groupings: 10 All items less food1 7.4 6.3 7.6 6.7 5.3 7.0 .5 .6 .7 .5 .5 171.6 11 All items less shelter1 7.1 5.0 8.3 6.3 3.0 6.9 .5 .4 .4 .4 .4 171.6 8.8 4.3 5.6 8.8 1.9 4.3 .8 .6 .5 .2 194.8 Wholesale prices 13 All commodities 3.7 4.2 10.8 6.5 -1.8 6.6 .3 -.1 .9 .6 .6 185.6 14 Farm products, and processed foods and feeds -1.5 -4.1 18.3 -4.1 -15.8 18.0 -1.0 --22..99 1.0 -.9 .2 117788..44 15 Farm products 2.1 -4.2 29.7 .6 -21.0 22.1 -1.0 -2.9 1.9 -1.2 -.5 183.6 16 Processed foods and feeds -3.7 -4.3 11.3 -7.3 -12.4 15.6 -.9 -2.9 .5 -.7 .6 174.8 17 Industrial commodities 5.8 6.6 8.0 10.8 3.2 3.6 .7 .7 .9 1.0 .8 187.0 Materials, supplies, and components of which : 18 Crude materials 2 -1.0 19.0 16.7 4.4 1.9 17.3 3.8 .1 -.5 4.0 2.3 269.6 19 Intermediate materials3 5.2 6.3 5.8 12.1 3.7 3.3 .5 .7 1.0 .7 .8 193.5 Finished goods, excluding foods: 20 Consumer 7.1 5.0 10.7 9.3 .5 2.3 .7 ..66 1.1 .7 .7 116655..55 21 Durable 6.0 3.9 4.4 9.2 3.4 1 1 0.0 .3 1.0 1.0 .5 147.4 22 Nondurable 7.6 5.7 14.4 9.5 -.9 2.6 1.1 .9 1.1 .7 .7 177.5 8.6 6.2 6.3 9.1 6.8 3.3 .5 .2 .8 1.4 .2 177.8 24 MEMO: Consumer foods 4.6 -5.1 11.2 .9 -20.5 16.8 -1.7 -2.2 .7 -.4 .8 176.0 1 Not seasonally adjusted. 3 Excludes intermediate materials for food manufacturing and manu- 2 Excludes crude foodstuffs and feedstuffs, plant and animal fibers, factured animal feeds. oilseeds, and leaf tobacco. SOURCE.—Bureau of Labor Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A52 Domestic Nonfinancial Statistics • January 1977 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted 1975 1976 11997733 11997744 1975 Account Q2 Q 3 Q4 Q 1 Q2 Q3 Gross national product 1 1,306.6 1,413.2 1,516.3 1,482.3 1,548.7 1,588.2 1,636.2 1,675.2 1,708.9 By source: ?, Personal consumption expenditures 809.9 887.5 973.2 960.3 987.3 1,012.0 1,043.6 1,064.7 1,088.5 3 Durable goods 123.7 121.6 131.7 127.0 136.0 141.8 151.4 155.0 157.6 4 Nondurable goods 333.8 376.2 409.1 405.8 414.6 421.6 429.1 434.8 441.8 5 Services 352.3 389.6 432.4 427.4 436.7 448.6 463.2 474.9 489.1 6 Gross private domestic investment 220.0 215.0 183.7 164.4 197.7 201.4 229.6 239.2 247.0 7 Fixed investment 202.1 204.3 198.3 194.3 198.6 205.7 214.7 223.2 231.9 8 Nonresidential 136.0 149.2 147.1 145.8 146.1 148.7 153.4 157.9 163.0 9 Structures 49.0 54.1 52.0 51.2 51.8 52.1 53.2 54.9 56.0 10 Producers' durable equipment 87.0 95.1 95.1 94.6 94.2 96.6 100.2 103.0 107.0 11 Residential structures 66.1 55.1 51.2 48.6 52.6 57.0 61.3 65.3 68.9 12 Nonfarm 64.3 52.7 49.0 46.7 50.2 54.2 58.6 62.9 66.3 N Change in business inventories 17.9 10.7 -14.6 -30.0 -2.0 -4.3 14.8 16.0 15.1 14 Nonfarm 14.7 12.2 -17.6 -31.2 -4.2 -9.5 12.7 17.3 15.6 15 Net exports of goods and services 7.1 7.5 20.5 24.4 21.4 21.0 8.4 9.3 3.4 16 Exports 101.6 144.4 148.1 142.9 148.2 153.7 154.1 160.3 166.3 17 Imports 94.4 136.9 127.6 118.5 126.8 132.7 145.7 151.0 162.9 18 Govt, purchases of goods and services 269.5 303.3 339.0 333.2 343.2 353.8 354.7 362.0 369.6 19 Federal 102.2 111.6 124.4 122.4 124.6 130.4 129.2 131.2 134.5 20 State and local 167.3 191.6 214.5 210.9 218.6 223.4 225.5 230.9 235.0 By major type of product: 21 Final sales, total 1,288.6 1,402.5 1,531.0 1,512.3 1,550.6 1,592.5 1,621.4 1,659.2 1,693.3 22 Goods, total 598.8 639.7 681.7 661.0 703.5 719.7 742.3 758.4 766.1 23 Durable goods 240.5 247.2 254.4 248.5 265.0 270.0 282.7 301.2 308.2 24 Nondurable 358.3 392.4 427.3 412.5 438.4 449.7 459.6 457.1 457.9 25 Services 560.5 626.6 692.5 684.2 700.2 719.5 742.6 759.6 780.1 26 Structures 147.2 146.9 142.1 137.1 145.0 149.1 151.3 157.3 162.2 27 Change in business inventories 17.9 10.7 -14.6 -30.0 -2.0 -4.3 14.8 16.0 15.1 28 Durable goods 240.5 247.2 254.4 248.5 265.0 270.0 282.7 301.2 308.2 29 Nondurable goods 358.3 392.4 427.3 412.5 438.4 449.7 459.6 457.1 457.9 30 MEMO: Total GNP in 1972 dollars 1,235.0 1,214.0 1,191.7 1,177.1 1,209.3 1,219.2 1,246.3 1,260.0 1,271.7 National income 31 1,064.6 1,135.7 1,207.6 1,182.7 1,233.4 1,264.6 1,304.7 1,337.4 1,362.5 32 Compensation of employees 799.2 875.8 928.8 912.9 935.2 963.1 994.4 1,017.2 1,037.5 33 Wages and salaries 701.2 764.5 806.7 792.8 811.7 836.4 861.5 881.1 897.8 34 Government and Government enterprises.. 148.6 160.4 175.8 173.8 177.3 182.2 185.4 188.7 191.7 35 Other 552.6 604.1 630.8 619.0 634.4 654.1 676.1 692.4 706.1 36 Supplement to wages and salaries 98.0 111.3 122.1 120.1 123.5 126.7 132.9 136.2 139.6 37 Employer contributions for social insurance 49.3 55.8 59.7 58.7 60.2 6611..66 6655..99 6677..11 6688..66 38 Other labor income 48.7 55.5 62.5 61.4 63.3 65.2 67.1 69.0 71.1 39 Proprietors' income1 92.4 86.9 90.2 86.8 95.5 97.2 93.2 100.3 96.1 40 Business and professional1 60.4 61.1 65.3 62.7 66.3 69.0 71.4 72.8 74.4 41 Farm1 32.0 25.8 24.9 24.1 29.2 28.3 21.9 27.5 21.7 42 Rental income of persons 31.3 33.3 37.0 36.6 37.3 38.4 39.6 39.6 40.6 43 Corporate profits1 99.1 84.8 91.6 86.6 105.3 105.6 115.1 116.4 122.0 44 Profits before tax2 115.8 127.6 114.5 105.8 126.9 131.3 141.1 146.2 150.2 45 Inventory valuation adjustment -18.6 -39.8 -11.4 -7.8 -9.0 -12.3 -11.5 -14.4 -12.6 46 Capital consumption adjustment 1.9 -3.0 -11.5 -11.4 -12.6 -13.5 -14.5 -15.4 -15.7 47 Net interest 52.3 67.1 74.6 74.0 74.9 75.8 78.6 80.3 83.5 1 With inventory valuation and capital consumption adjustments. SOURCE.—Survey of Current Business (U.S. Dept. of Commerce). 2 For after-tax profits, dividends, etc., see Table 1.50. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

National Income Accounts A53 2.17 PERSONAL INCOME AND SAVING Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted. 1975 1976 1973 1974 1975 Account Q2 Q3 Q4 Q 1 Q2 Q3 Personal income and saving 1,052.4 1 153.3 1,249 7 1,230.3 1,265.5 1,299.7 1,331.3 1,362.0 1,386.0 701.3 765.0 806.7 792.8 811.7 836.4 961.5 881.1 897.8 3 Commodity-producing industries 253.5 273.9 275.3 269.1 272.2 285.8 295.3 302.9 307.0 196.2 211.4 211.7 206.9 212.5 220.3 229.6 235.6 238.9 5 Distributive industries 168.1 184.4 195.6 192.5 196.8 202.3 208.3 212.8 216.5 6 Service industries 131.0 145.9 159.9 157.4 161.3 166.1 172.4 176.7 182.7 7 Government and government enterprises 148.6 160.9 175.8 173.8 177.3 182.2 185.4 188.7 191.7 8 Other labor income 48.7 55.5 62.5 61.4 63.3 65.2 67.1 69.0 71.1 92.4 86.9 90.2 86.8 95.5 97.2 93.2 100.3 96.1 10 Business and professional1 60.4 61.1 65.3 62.7 66.3 69.0 71.4 72.8 74.4 11 Farm1 32.0 25.8 24.9 24.1 29.2 28.3 21.9 27.5 21.7 12 Rental income of persons2 21.6 21.0 22.4 22.3 22.4 22.9 23.3 23.1 23.4 13 Dividends 27.8 30.8 32.1 31.9 32.6 32.2 33.1 34.4 35.4 14 Personal interest income 84.1 101.4 110.7 109.0 111.0 114.4 118.0 120.7 125.0 118.9 140.3 175.2 175.5 179.1 182.5 188.6 187.6 192.4 16 Old-age survivors, disability, and health 60.4 70.1 81.4 77.8 84.7 86.3 88.1 89.5 95.8 17 LESS: Personal contributions for social insurance 42.2 47.6 50.0 49.5 50.1 51.0 53.4 54.3 55.2 18 EQUALS: Personal income 11,,005522..44 1,153.3 1,249.7 1,230.3 1,265.5 1,299.7 1,331.3 1,362.0 1,386.0 19 LESS: Personal tax and nontax payments 115500..88 170.4 168.8 142.2 174.0 197.8 183.8 189.5 195.8 20 EQUALS : Disposable personal income 901.7 982.9 1,080.9 1,088.2 1,091.5 1,119.9 1,147.6 1,172.5 1,190.2 21 LESS: Personal outlays 831.3 910.7 996.9 983.6 1,011.1 1,036.2 1,068.0 1,089.6 1,114.3 22 EQUALS : Personal saving 70.3 72.2 84.0 104.5 80.5 83.7 79.5 82.9 75.8 MEMO: Per capita (1972 dollars): 23 Gross national product 4,062 3,968 4,007 44,,007788 4,009 4,049 4,103 4,143 4,142 24 Personal consumption expenditures 809.9 887.5 973.2 996600..33 987.3 1,012.0 1,043.6 1,064.7 1,088.5 25 Disposable personal income 854.7 840.8 855.5 869.7 857.1 867.5 880.4 890.5 892.0 26 Saving rate (per cent) 7.8 7.3 7.8 9.6 7.4 7.5 6.9 7.1 6.4 Gross saving 27 Gross private saving 210.5 211.6 255.6 273.2 262.7 269.4 273.8 279.1 278.6 28 Personal saving 70.3 72.2 84.0 104.5 80.5 83.7 79.5 82.9 75.8 29 Undistributed corporate profits1 22.6 1.7 10.3 9.9 17.9 16.2 20.6 18.5 21.2 30 Corporate inventory valuation adjustment -18.6 -39.8 -11.4 -7.8 -9.0 -12.3 -11.5 -14.4 -12.6 Capital consumption allowances: 3 31 Corporate 71.9 84.6 100.9 99.3 103.1 106.4 108.8 111.6 113.9 32 Noncorporate 4455..88 53.1 60.4 59.5 61.3 63.2 64.8 66.1 67.7 34 Government surplus, or deficit (—), national income and product accounts 6.3 -4.2 -64.4 -92.9 -58.1 -61.5 -51.6 -44.9 -44.4 35 Federal -6.7 -11.5 -71.2 -99.9 -66.0 -69.4 -63.8 -54.1 -57.1 36 State and local 1133..00 7.3 6.9 6.9 7.9 7.9 12.2 9.2 12.7 37 Capital grants received by the United States, (neO --22..00 38 In vest men t 219.4 211.9 195.6 180.3 209.8 214.0 229.4 240.0 241.6 39 Gross private domestic 220.0 215.0 183.7 164.4 196.7 201.4 229.6 239.2 247.0 40 Net foreign -.6 -3.0 11.9 15.9 13.1 12.6 -.2 .8 -5.5 41 Statistical discrepancy || 22..66 66..88 4.4 .4 5.1 6.1 7.2 5.8 7.4 1 With inventory valuation and capital consumption adjustments. SOURCE.—Survey of Current Business (U.S. Dept. of Commerce). 2 With capital consumption adjustment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 International Statistics • January 1977 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars. Quarterly figures are seasonally adjusted except as noted.1 1975 1976 CCrreeddiittss ((++)),, ddeebbiittss ((--)) 11997733 11997744 11997755 Q3 Q4 Ql Q2 Q3 j Merchandise exports 71,410 98,310 107,088 26,562 27,657 26,836 28,428 29,581 2 70,499 103,679 98,058 24,483 25,437 28,510 29,771 32,614 3 Merchandise trade balance 2 911 -5,369 9,030 2,079 2,220 -1,674 -1,343 -3,033 4 Military transactions, net -2,287 -2,083 -883 -115 12 -5 -146 366 5 Investment income, net 5,178 10,227 6,007 1,682 1,670 2,279 2,460 2,712 6 Other service transactions, net 102 812 2,163 619 455 458 765 824 7 Balance on goods and services 3 3,905 3,586 16,316 4,265 4,357 1,058 1,736 869 8 Unilateral transfers -3,883 -7,185 -4,620 -1,044 -1,251 -1,118 -920 -1,925 9 Remittances, pensions, and other transfers -1,945 -1,710 -1,727 -429 -433 -483 -452 -464 10 U.S. Government grants (excluding military) -1,938 -5,475 -2,893 -615 -818 -635 -468 -1,461 1 j 22 -3,598 11,697 3,221 3,106 -60 816 -1,056 12 551133 44,,330055 11,,447799 777711 --44,,003333 13 U.S. Govt, capital transactions, other than official reserve assets, net (outflow,—) -1,492 1,089 -1,731 -401 -453 798 -212 301 14 Change in U.S. official reserve assets (increase,—) 209 -1,434 -607 -342 89 -773 -1,578 -407 15 16 SDR's 9 -172 -66 -25 -21 -45 14 -18 17 -33 -1,265 -466 -95 -57 -237 -798 -716 18 233 3 -75 -222 167 -491 -794 327 19 Change in U.S. private assets abroad (increase,—) -13,998 -32,323 -27,523 -3,297 -10,375 -8,550 -7,288 -7,040 20 Bank-reported claims -5,980 -19,494 -13,487 -617 -5,348 -3,582 -4,767 -3,339 21 -933 -1,183 -2,373 -608 -943 -250 -385 -989 22 -5,047 -18,311 -11,114 -9 -4,405 -3,332 -4,382 -2,350 23 Nonbank-reported claims -2,378 -3,221 -1,522 —972 -972 -751 -962 350 24 -396 -474 -441 -139 -379 -187 146 21 25 -1,982 -2,747 -1,081 -833 -593 -564 -1,108 329 26 U.S. purchase of foreign securities, net -671 -1,854 -6,206 -938 -2,361 -2,460 -1,357 -2,806 27 U.S. direct investments abroad, net -4,968 -7,753 -6,307 -770 -1,694 -1,757 -202 -1,245 28 Change in foreign official assets in the United States (increase,+).. 5,145 10,257 5,166 -1,977 2,272 2,460 3,308 1,258 29 U.S. Treasury securities 114 3,282 4,338 -2,847 1,069 1,998 2,166 1,261 30 Other U.S. Govt, obligations 582 902 891 25 307 68 316 66 31 Other U.S. liabilities reported by U.S. banks 4,126 5,818 -2,158 320 134 -275 135 -595 32 Other foreign official assets 323 254 2,095 525 762 669 691 526 33 Change in foreign private assets in the United States (increase,+). . 12,220 21,452 8,427 4,313 3,103 1,454 3,225 5,458 34 U.S. bank-reported liabilities 4,702 16,017 647 1,639 691 675 3,518 1,719 35 227 9 -300 -114 146 -91 -25 67 36 4,475 16,008 947 1,753 545 766 3,543 1,652 37 U.S. nonbank-reported liabilities 1,035 1,615 171 -141 -68 24 -248 -141 38 298 -212 345 -99 10 -332 -188 -215 39 737 1,827 -174 -42 -78 356 -60 74 40 Foreign private purchases of U.S. Treasury securities, net -214 697 2,667 2,125 213 453 -598 3,020 41 Foreign purchases of other U.S. securities, net 4,041 378 2,505 738 1,038 1,030 131 77 42 Foreign direct investments in the United States, net 2,656 2,745 2,437 -48 1,229 -728 422 784 43 Allocations of SDR's 44 -2,107 4,557 4,570 -1,517 2,258 4,671 1,729 1,485 45 --22,,556611 11,,227755 11,,334499 -76 --22,,882299 46 Statistical discrepancy in recorded data before seasonal -2,107 4,557 4,570 1,044 983 3,322 11,,880055 4,314 MEMO: Changes in official assets: 47 209 -1,434 -607 -342 89 -773 --11,,557788 --440077 48 Foreign official assets in the U.S. (increase,+) 5,145 10,257 5,166 -1,977 2,272 2,460 3,308 1,258 49 Transfers under military grant programs (excluded from lines 2,809 1,817 2,232 56 117777 5500 9999 115566 1 Seasonal factors are no longer calculated for capital transactions— the national income and product (GNP) account. The GNP definition lines 14 through 49. excludes special military sales from exports and U.S. Govt, interest pay- 2 Adjusted to a balance of payments basis; among other adjustments, ments from imports. excludes military transactions and includes imports into the Virgin Islands. NOTE.—Data are from Bureau of Economic Analysis, Survey of Current 3 Differs from the definition of "net exports of goods and services" in Business (U.S. Dept. of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Trade A55 3.11 U.S. FOREIGN TRADE Millions of dollars; monthly data, seasonally adjusted 1976 IItteemm 11997733 11997744 11997755 May June July Aug. Sept. Oct. Nov. 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments 70,823 97,908 107,130 9,578 9,716 10,022 9,688 9,872 9,728 9,625 2 GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded warehouses 69,476 100,251 96,116 9,182 10,094 10,849 10,446 10,651 10,424 10,531 3 Trade balance +1,347 -2,343 + 11,014 +396 -377 -827 -758 -779 -696 -906 NOTE.—Bureau of Census data reported on a free-alongside-ship $100.3 billion, about 0.7 per cent less than the corresponding customs (f.a.s.) value basis. Before 1974 imports were reported on a customs import value. import value basis. For calendar year 1974 the f.a.s. import value was SOURCE.—U.S. Dept. of Commerce, Bureau of the Census, Summary of U.S. Export and Import Merchandise Trade (FT 900). 3.12 U.S. RESERVE ASSETS Millions of dollars outstanding; end of period 1976 TTyyppee ooff aasssseett 1973 1974 1975 June July Aug. Sept. Oct. Nov. Dec. 1 Total 314,378 15,883 16,226 18,477 18,246 18,586 18,945 19,013 19,416 418,747 2 Gold stock, including Exchange Stabilization Fund1 311,652 11,652 11,599 11,598 11,598 11,598 11,598 11,598 11,598 11,598 3 Special Drawing Rights 2 32,166 2,374 2,335 2,316 2,318 2,325 2,357 2,352 2,365 42,395 4 Reserve position in International Monetary Fund 3552 1,852 2,212 3,198 3,466 3,818 3,952 3,997 4,307 44,434 5 Convertible foreign currencies 8 5 80 1,365 864 845 1,038 1,066 1,146 320 1 Gold held under earmark at Federal Reserve Banks for foreign and 4 Beginning July 1974, the IMF adopted a technique for valuing the international accounts is not included in the gold stock of the United SDR based on a weighted average of exchange rates for the currencies States; see Table 3.23. of 16 member countries. The U.S. SDR holdings and reserve position in 2 Includes allocations by the International Monetary Fund of SDR's the IMF also are valued on this basis beginning July 1974. At valuation as follows: $867 million on Jan. 1, 1970; $717 million on Jan. 1, 1971; used prior to July 1974 (SDR1 = $1.20635) total U.S. reserve assets and $710 million on Jan. 1, 1972; plus net transactions in SDR's. at end of December amounted to $18,895; SDR holdings, $2,482; and 3 Change in par value of U.S. dollar on Oct. 18, 1973 increased total reserve position in IMF, $4,495. reserve assets by $1,436 million, gold stock by $1,165 million, SDR's by $217 million, and reserve position in IMF by $54 million. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A56 International Statistics • January 1977 3.13 SELECTED U.S. LIABILITIES TO FOREIGNERS Millions of dollars outstanding, end of period 1974 1976 TTyyppee ooff lliiaabbiilliittyy,, hhoollddeerr,, aanndd 11997733 11997755 ooffffiicciiaall,, bbyy aarreeaa Dec. 9 June July Aug. Sept. Oct. * Nov. * 1 Total 92,490 119,240 119,164 126,558 135,202 139,169 138,743 140,788 143,829 144,663 2 Foreign countries 90,487 115,918 115,842 120,926 129,255 132,430 131,693 133,032 136,200 136,424 3 Official institutions1 66,861 76,801 76,823 80,681 85,178 85,924 86,716 86,076 86,788 87,645 By type of liability: 4 Short-term, reported by banks in the United States. 43,923 53,057 53,079 49,513 50,014 50,474 5511,,224499 4499,,665577 4488,,999900 4499,,118800 U.S. Treasury bonds and notes: 5 Marketable2 5,701 5,059 5,059 6,671 9,225 9,519 9,835 10,800 11,027 11,367 6 Nonmarketable3 15,564 16,339 16,339 19,976 20,251 20,151 1199,,880011 1199,,880033 2200,,887766 2211,,113311 7 Other readily marketable liabilities4 1,673 2,346 2,346 4,521 5,688 5,780 5,831 5,816 5,895 5,967 By area: 8 Western Europe1 45,764 44,328 44,328 45,676 42,425 42,321 41,504 41,564 41,927 44,024 9 Canada 3,853 3,662 3,662 3,132 3,578 3,410 3,212 3,417 3,389 2,406 10 Latin American republics... 2,544 4,419 4,419 4,448 4,104 4,000 4,378 4,286 4,090 4,086 11 Asia 10,887 18,604 18,626 22,545 29,927 30,994 32,629 32,427 33,402 33,859 12 Africa 788 3,161 3,161 2,983 3,245 3,134 3,098 2,758 2,414 1,925 13 Other countries5 3,025 2,627 2,627 1,897 1,899 2,065 1,895 1,624 1,566 1,345 Commercial banks abroad 14 Short-term reported by banks in the United States6 17,694 30,314 30,106 29,516 32,631 34,743 32,828 34,610 37,123 35,527 Other foreigners 55,,993322 88,,880033 88,,991133 1100,,772299 1111,,444466 1111,,776633 12,149 1122,,334466 1122,,228899 1133,,225522 15 Short-term, reported by banks in the United States 55,,550022 88,,330055 88,,441155 1100,,002288 1100,,664455 1100,,993322 1111,,223388 1111,,447755 1111,,336622 1122,,228822 16 Marketable U.S. Treasury bonds and notes2,7 430 498 498 701 801 831 911 871 927 970 17 Nonmonetary international and regional organizations 8 2,003 3,322 3,322 5,632 5,947 6,739 77,,005500 77,,775566 77,,662299 88,,223399 18 Short-term reported by banks in the United States 11,,995555 33,,117711 33,,117711 55,,330011 55,,336655 55,,667711 55,,664499 55,,996655 55,,110011 55,,551188 19 Marketable U.S. Treasury bonds and notes 2 48 151 151 331 582 1,068 1,401 1,791 2,528 2,721 1 Includes Bank for International Settlements. 9 Data in the 2 columns shown for this date differ because of changes in 2 Derived by applying reported transactions to benchmark data. reporting coverage. Figures in the first column are comparable in coverage 3 Excludes notes issued to foreign official nonreserve agencies. with those for the preceding date; figures in the second column are 4 Includes long-term liabilities reported by banks in the United States comparable with those shown for the following date. and debt securities of U.S. Federally sponsored agencies and U.S. corporations. NOTE.—Based on Treasury Dept. data and on data reported to the 5 Includes countries in Oceania and Eastern Europe, and Western Treasury Dept. by banks and brokers in the United States. Data exclude European dependencies in Latin America. the holdings of dollars of the International Monetary Fund derived from 6 Includes short-term liabilities payable in foreign currencies to com- payments of the U.S. subscription, and from the exchange transactions mercial banks abroad and to other foreigners. and other operations of the IMF. Data also exclude U.S. Treasury letters 7 Includes marketable U.S. Treasury bonds and notes held by com- of credit and nonnegotiable, non-interest-bearing special U.S. notes held mercial banks abroad and other foreigners. by nonmonetary international and regional organizations. 8 Principally the International Bank for Reconstruction and Development and the Inter-American and Asian Development Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A57 3.14 SHORT-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States By Holder and by Type of Liability Millions of dollars outstanding; end of period 1974 1976 HHoollddeerr,, aanndd ttyyppee ooff lliiaabbiilliittyy 1973 1975 Dec. 8 June July Aug. Sept. Oct.f Nov.? All foreigners, excluding the International Monetary Fund 69,074 94,847 94,771 94,350 98,655 101,820 100,964 101,708 102,576 102,507 2 Payable in dollars 68,477 94,081 94,004 93,793 97,964 101,147 110000,,229955 110011,,000066 110011,,881100 101,726 Deposits: 3 Demand 11,310 14,068 14,051 13,564 14,135 14,714 14,198 14,793 14,645 15,846 4 Time1 6,882 10,106 9,932 10,348 9,978 10,259 10,194 10,644 10,491 10,586 5 U.S. Treasury bills and certificates2 31,886 35,662 35,662 37,414 38,244 39,632 40,964 40,119 38,939 38,634 6 Other short-term liabilities3 18,399 34,246 34,359 32,466 35,607 36,542 34,939 35,450 37,735 36,391 7 Payable in foreign currencies 597 766 766 558 691 673 669 702 766 781 8 Nonmonetary international and regional organizations4 1,955 3,171 3,171 55,,229933 5,365 5,671 5,649 5,966 5,102 5,518 9 Payable in dollars 1,955 3,171 3,171 5,284 5,360 5,665 5,641 55,,996622 55,,009988 55,,551144 Deposits: 10 Demand 110011 139 139 139 258 483 379 331 256 287 11 Time1 83 111 111 148 160 192 148 151 164 199 12 U.S. Treasury bills and certificates 296 497 497 2,554 2,236 3,129 3,475 4,031 3,196 3,604 13 Other short-term liabilities5 1,474 2,424 2,424 2,443 2,706 1,862 1,639 1,449 1,482 1,424 14 Payable in foreign currencies 8 5 6 8 4 4 4 15 Official institutions, banks, and other foreigners.. 67,119 91,676 91,600 89,057 93,290 96,149 95,315 95,742 97,475 96,989 16 Payable in dollars 66,522 90,910 90,834 88,508 92,604 95,482 9944,,665544 9955,,004455 96,713 9966,,221122 Deposits: 17 Demand 11,209 13,928 13,912 13,426 13,877 14,231 13,819 14,462 14,389 15,559 18 Time1 6,799 9,995 9,821 10,200 9,818 10,067 10,046 10,493 10,327 10,657 19 U.S. Treasury bills and certificates2 31,590 35,165 35,165 34,860 36,008 36,504 37,489 36,088 35,743 35,030 20 Other short-term liabilities3 16,925 31,822 31,935 30,023 32,900 34,680 33,300 34,001 36,254 34,967 21 Payable in foreign currencies 597 766 766 549 687 667 661 697 762 777 22 Official institutions6 43,923 53,057 53,079 49,513 50,014 50,474 51,249 49,657 48,990 49,180 23 Payable in dollars 43,795 52,930 52,952 49,513 50,014 50,474 51,249 49,657 48,990 49,180 Deposits: 24 Demand 2,125 2,951 2,951 2,644 2,632 2,932 2,380 2,544 2,694 2,672 25 Time1 3,911 4,257 4,167 3,423 2,395 2,251 2,207 2,144 2,107 2,128 26 U.S. Treasury bills and certificates2 31,511 34,656 34,656 34,182 35,519 36,016 36,974 35,653 35,245 34,640 27 Other short-term liabilities5 6,248 11,066 11,178 9,264 9,468 9,275 9,688 9,317 8,943 9,740 28 Pnvnhle in fnreivn currencies 127 127 127 29 Banks and other foreigners 23,196 38,619 38,520 39,544 43,276 45,675 44,066 46,084 48,485 47,809 30 Payable in dollars 22,727 37,980 37,881 38,995 42,590 45,008 43,404 43,387 47,723 47,032 31 Banks7 17,224 29,676 29,467 28,966 31,944 34,076 32,167 33,913 36,361 34,751 Deposits: 32 6,941 8,248 8,231 7,534 8,100 7,992 7,934 8,233 8,361 8,946 33 Time1 529 1,942 1,910 1,942 1,884 2,275 2,206 2,578 2,291 2,104 34 U.S. Treasury bills and certificates 11 232 232 335 154 155 162 176 223 174 35 Other short-term liabilities3 9,743 19,254 19,094 19,155 21,806 23,654 21,865 22,925 25,486 23,527 36 Other foreigners 5,502 8,304 8,414 10,029 10,646 10,932 11,238 11,474 11,362 12,282 Deposits: 37 Demand 2,143 2,729 2,730 3,248 3,146 3,307 3,505 3,686 3,334 3,942 38 Time1 2,359 3,796 3,744 4,836 5,539 5,541 5,632 5,771 5,929 6,424 39 U.S. Treasury bills and certificates 68 277 277 342 335 333 353 259 274 216 40 933 1,502 1,664 1,605 1,626 1,751 1,747 1,759 1,824 1,700 41 Payable in foreign currencies 469 639 639 549 687 667 661 697 762 777 1 Excludes negotiable time certificates of deposit, which are included 6 Foreign central banks and foreign central governments and their in "Other short-term liabilities." agencies, and Bank for International Settlements. 2 Includes nonmarketable certificates of indebtedness and Treasury 7 Excludes central banks, which are included in "Official institutions." bills issued to official institutions of foreign countries. 8 Data in the two columns shown for this date differ because of changes 3 Includes liabilities of U.S. banks to their foreign branches, liabilities in reporting coverage. Figures in the first column are comparable with of U.S. agencies and branches of foreign banks to their head offices and those for the preceding date; figures in the second column are comparable foreign branches of their head offices, bankers acceptances, commercial with those shown for the following date. paper, and negotiable time certificates of deposit. 4 Principally the International Bank for Reconstruction and Develop- NOTE.—"Short-term obligations" are those payable on demand, or ment, and the Inter-American and Asian Development Banks. having an original maturity of 1 year or less. 5 Principally bankers acceptances, commercial paper, and negotiable time certificates of deposit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 International Statistics • January 1977 3.15 SHORT-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States By Country Millions of dollars outstanding; end of period 1974 1976 Area and country 1973 1975 Dec. 7 June July Aug. Sept. Total. 69,074 94,847 94,771 94,350 98,655 101,820 100,964 101,708 102,576 2 Foreign countries. 67,119 91,676 91,600 89,057 93,290 96,149 95,315 95,742 97,475 3 Europe 40,742 48,667 48,813 43,988 40,796 39,899 38,990 40,165 40,155 4 Austria 161 607 607 754 549 589 412 335 334 5 Belgium-Luxembourg.. 1,483 2,506 2,506 2,898 2,336 1,977 1,976 1,946 1,879 6 Denmark 659 369 369 332 452 322 440 317 372 7 Finland 165 266 266 391 405 446 435 415 407 8 France 3,483 4,287 4,287 7,733 4,776 4,408 4,214 4,355 4,409 9 Germany 13,227 9,420 9,429 4,357 4,932 4,961 4,738 5,964 6,532 10 Greece 389 248 248 284 346 361 350 337 405 11 Italy 1,404 2,617 2,577 1,072 1,520 2,263 2,641 1,574 1,583 12 Netherlands 2,886 3,234 3,234 3,411 2,248 2.184 2,189 2,565 2,534 13 Norway 965 1,040 1,040 996 798 898 684 789 690 14 Portugal 534 310 310 195 196 250 257 193 177 15 Spain 305 382 382 426 447 416 419 540 506 16 Sweden 1,885 1,138 1,138 2,286 2,435 2,384 2,227 1,979 1,295 17 Switzerland 3,377 9,986 10,139 8,514 10,130 9,551 9,250 9,016 8,332 18 Turkey 98 152 152 118 95 80 100 65 74 19 United Kingdom 6,148 7,559 7,584 6,886 6,655 6,289 6,139 7,292 8,137 20 Yugoslavia 86 183 183 126 182 128 142 128 131 21 Other Western Europe1 3,352 4,073 4,073 2,970 2,066 2,150 2.130 2,103 2,098 22 U.S.S.R 22 82 82 40 40 35 34 70 75 23 Other Eastern Europe. 110 206 206 200 188 209 215 182 184 24 Canada. 3,627 3,517 3,520 3,076 3,789 3,995 3,790 4,780 4,033 25 Latin America 7,664 12,038 11,754 14,954 16,595 18,964 17,619 17,490 19,065 26 Argentina 924 886 886 1,147 1,394 1,407 1,510 1,437 1,374 27 Bahamas 852 1,448 1,054 1,827 2,908 4,838 3,006 2,628 4,817 28 Brazil 860 1,034 1,034 1,227 1,271 1,308 1,200 1,132 1,323 29 Chile 158 276 276 317 369 301 303 325 298 30 Colombia 247 305 305 417 686 762 772 767 804 31 Cuba 7 7 7 6 7 6 7 6 6 32 Mexico 1,296 1,770 1,770 2,078 2,162 2,110 2,301 2,348 2,475 33 Panama 282 488 510 1,099 1,207 1,050 1,387 912 866 34 Peru 135 272 272 244 221 235 239 236 247 35 Uruguay 120 147 165 172 229 219 226 244 233 36 Venezuela 1,468 3,413 3,413 3,289 2,643 2,747 3,092 3,208 2.644 37 Other Latin American republics. 884 1,316 1,316 1,494 1,836 1,790 1,703 1,750 1,676 38 Netherlands Antilles 2.... 71 158 158 129 129 135 149 147 160 39 Other Latin America 359 519 589 1,507 1,533 2,057 1,723 2,348 2,142 40 Asia 10,839 21,073 21,130 21,539 26,347 27,522 29,360 28,406 29,676 41 China, People's Republic of (China Mainland) 38 50 50 123 63 42 45 45 48 42 China, Republic of (Taiwan) 757 818 818 1,025 1, 182 1,070 1.131 1,122 1,115 43 Hong Kong 372 530 530 623 747 788 842 874 886 44 India 85 261 261 126 845 938 1,047 985 1,048 45 Indonesia 133 1,221 1,221 369 706 1,122 1,002 995 1,154 46 Israel 327 386 389 386 316 298 324 300 310 47 Japan 6,967 10,897 10,931 10,218 12,847 13,631 14,194 14,424 14,664 48 Korea 195 384 384 390 343 346 369 350 366 49 Philippines 515 747 747 698 742 636 653 622 582 50 Thailand 247 333 333 252 261 244 249 215 223 51 Middle East oil-exporting countries3. 4,633 4,623 6,461 7,290 7,286 8,127 7,198 7,741 52 Other 4 1,202 813 844 867 1,005 1,122 1,376 1,276 1,540 53 Africa 1,056 3,551 3,551 3,373 3,591 3,473 3,469 3,076 2,782 54 Egypt 35 103 103 343 211 236 200 186 213 55 Morocco 11 38 38 68 77 60 107 80 85 56 South Africa 114 130 130 169 161 123 164 165 183 57 Zaire 87 84 84 63 43 45 36 37 45 58 Oil-exporting countries5. 2,814 2,814 2,239 2,567 2,443 2,368 2,075 1,732 59 Other4 808 383 383 491 531 567 593 533 524 60 Other countries. 3,190 2,831 2,831 2,128 2,173 2,296 2,087 1,824 1,763 61 Australia.... 3,131 2,742 2,742 2,014 2,066 2.185 1,964 1,711 1.645 62 Allother 59 89 89 114 107 111 122 114 119 63 Nonmonetary international and regional organizations 1,955 3,171 3,171 5,293 5,365 5,671 5,649 5,966 5,102 64 International 1,627 2,900 2,900 5,064 5,050 5,383 5,285 5,613 4,717 65 Latin American regional. 272 202 202 187 189 176 168 154 182 66 Other regional 6 57 69 69 42 126 112 196 199 203 For notes see bottom of p. A59. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A59 3.16 SHORT-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States Supplemental "Other" Countries 1 Millions of dollars outstanding; end of period 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: Cyprus 10 7 17 6 25 Afghanistan 11 18 19 41 54 I I r c e e l l a a n n d d , Republic of.. 5 1 3 1 2 2 9 1 2 2 0 9 7 3 5 3 39 2 2 6 7 B Bu an rm gl a a desh 4 1 2 2 2 6 1 5 5 4 0 9 5 3 4 1 34' 28 Cambodia 4 4 4 4 Other Eastern Europe: 29 Jordan 6 22 30 39 20 Bulgaria 6 36 13 19 13 30 Laos 3 3 5 2 2 Czechoslovakia 19 34 11 32 10 31 Lebanon 68 126 180 117 German Democratic Republic. 3 36 18 17 3 32 Malaysia 40 63 92 77 105 Hungary 8 14 11 13 10 33 Nepal 21 25 22 28 34 Poland 36 55 42 66 65 34 Pakistan 108 91 118 74 89 Rumania 16 25 14 44 28 35 Singapore 165 245 215 256 36 Sri Lanka (Ceylon) 13 14 13 13 9 Other Latin American republics: 37 Vietnam 98 126 70 62 33 Bolivia 102 96 93 110 104 Costa Rica 88 118 120 124 69 Other Africa: Dominican Republic 137 128 214 169 149 38 Ethiopia (incl. Eritrea). 118 95 76 60 70 Ecuador 90 122 157 120 39 Ghana 22 18 13 23 EI Salvador 129 129 144 171 128 40 Ivory Coast 13 7 62 Guatemala 245 219 255 260 177 41 Kenya 20 31 32 19 37 H H o a n it d i uras 2 7 8 1 3 8 5 8 9 3 2 4 9 3 9 8 6 3 9 3 4 4 2 3 L So ib u e t r h i e a r n Rhodesia 29 1 3 2 9 33 3 53 1 61 1 Jamaica 52 69 62 41 49 44 Sudan 2 4 14 12 17 Nicaragua 119 127 125 133 89 45 Tanzania 12 11 21 30 18 Paraguay 40 46 38 43 43 46 Tunisia 17 19 23 29 33 Surinam2 12 47 Uganda 11 13 38 22 Trinidad and Tobago 21 107 31 131 48 Zambia 66 22 18 78 Other Latin America: All Other: 23 Bermuda 201 116 100 170 49 New Zealand 33 47 36 42 29 24 British West Indies. 354 449 627 1,311 1 Represents a partial breakdown of the amounts shown in the "other" 2 Surinam included with Netherlands Antilles until January 1976. categories on preceding page. 3.17 LONG-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States Millions of dollars outstanding; end of period 1976 Holder, and area or country 1973 1974 1975 May June July Aug. Sept. Oct.*5 Nov.^ Total. 1,462 1,285 1,812 2,134 2,255 2,308 2,254 2,218 2,315 2.314 2 Nonmonetary international and regional organizations 761 822 415 135 189 235 246 214 333 308 3 Foreign countries. 700 464 1,397 1,999 2,066 2,073 2,008 2,003 1,983 2,007 4 Official institutions, including central banks. 310 124 931 1,429 1,490 1,479 1,402 1,386 1,314 1.315 6 5 B O a th n e k r s , f o e r x e c i l g u n d e in rs g central banks 2 1 9 0 1 0 26 7 1 9 316040 4 1 3 3 3 7 4 1 3 4 5 1 4 1 5 4 1 3 4 1 5 4 7 9 4 1 5 5 8 9 4 1 9 7 9 0 5 1 2 6 7 5 Area or country: Europe 470 226 330 454 459 463 470 470 489 509 Germany 159 146 214 306 308 307 311 312 310 309 United Kingdom. 66 59 66 87 89 92 91 99 115 10 Canada 8 19 23 24 24 26 26 26 28 26 11 Latin America. 132 115 140 104 107 117 122 125 151 154 12 Middle East oil-exporting countries1. 94 894 1,399 1,458 1,448 1,369 ,340 1,286 1,237 13 Other Asia2 82 7 16 16 17 20 41 27 79 14 African oil-exporting countries3. 15 Other Africa4 16 All other countries. 1 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, 4 Includes African oil-exporting countries until December 1974. and United Arab Emirates (Trucial States). 2 Includes Middle East oil-exporting countries until December 1974. NOTE.—Long-term obligations are those having an original maturity 3 Comprises Algeria, Gabon, Libya, and Nigeria. of more than 1 year. Notes to Table 3.15 1 Includes Bank for International Settlements. 6 Asian, African, and European regional organizations, except BIS, 2 Surinam included with Netherlands Antilles until January 1976. which is included in "Other Western Europe." 3 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, 7 Data in the two columns shown for this date differ because of changes and United Arab Emirates (Trucial States). in reporting coverage. Figures in the first column are comparable with 4 Includes oil-exporting countries until December 1974. those shown for the preceding date; figures in the second column are 5 Comprises Algeria, Gabon, Libya, and Nigeria. comparable with those shown for the following date. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A60 International Statistics • January 1977 3.18 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Banks in the United States By Country Millions of dollars outstanding; end of period 1976 Area and country 1973 1974 1975 May June July Aug. Sept. Oct.f Nov.f 1 20,723 39,056 50,240 57,622 57,965 59,332 58,016 60,317 60,941 64,194 2 Foreign countries 20,723 39,055 50,238 57,621 57,964 59,331 58,015 60,305 60,935 64,188 3 3,970 6,255 8,987 9,224 9,567 10,003 9,487 9,436 10,435 10,819 4 Austria 11 21 15 25 35 24 24 41 42 54 5 Belgium-Luxembourg 147 384 352 427 537 562 472 437 504 501 6 Denmark 48 46 49 57 62 68 50 57 64 129 7 Finland 108 122 128 109 125 133 176 129 137 136 8 France 621 673 1,471 1,109 1,145 1,100 929 1,169 1,096 1,100 9 Germany 311 589 436 442 384 432 414 501 585 667 10 Greece 35 64 49 62 53 70 68 117 88 76 11 Italy 316 345 370 492 552 644 617 648 733 877 17 Netherlands 133 348 300 267 318 251 266 254 399 240 n Norway 72 119 71 76 71 74 78 68 79 85 14 Portugal 23 20 16 32 40 53 57 55 46 53 15 Spain 222 196 249 321 285 302 239 265 264 304 16 Sweden 153 180 167 116 106 97 143 106 101 93 17 Switzerland 176 335 237 355 401 374 442 417 499 510 18 Turkey 10 15 86 40 99 81 77 80 125 140 19 United Kingdom 1,459 2,580 4,718 4,987 5,074 5,435 5,167 4,844 5,376 5,522 20 Yugoslavia 10 22 38 44 45 45 40 28 37 38 ?1 Other Western Europe 25 22 27 41 57 42 50 56 54 58 ?? U.S.S.R 46 46 103 70 70 69 53 52 83 103 23 Other Eastern Europe 44 131 108 102 110 147 125 107 123 134 24 Canada 1,955 2,776 2,817 3,364 3,166 3,027 3,050 3,169 3,129 3,136 25 Latin America 5,900 12,377 20,540 27,321 27,030 28,477 27,614 30,042 29,230 31,697 26 Argentina 499 720 1,203 1,342 1,149 1,149 1,149 961 902 858 27 Bahamas 883 3,405 7,577 11,114 11,466 12,381 11,532 14,192 12,587 14,686 28 Brazil 900 1,418 2,221 2,414 2,700 2,633 2,773 2,892 3,126 3,267 29 Chile 151 290 360 356 342 364 352 343 350 358 30 Colombia 397 713 689 518 534 537 501 459 517 523 31 Cuba 12 14 13 16 16 13 13 13 13 14 32 Mexico 1,373 1,972 2,804 3,444 3,494 3,562 3,559 3,456 3,210 3,298 33 Panama 274 505 1,052 991 840 697 778 809 1,119 780 34 Peru 178 518 583 621 623 665 666 694 638 630 35 Uruguay 55 63 51 33 34 31 31 28 28 35 36 Venezuela 518 704 1,086 1,280 1,153 1,237 1,503 1,305 1,328 1,512 37 Other American republics 493 852 967 1,137 980 1,059 978 1,112 1,037 1,068 38 Netherlands Antilles1 13 62 49 32 33 28 29 42 41 46 39 Other Latin America 154 1,142 1,885 4,023 3,667 4,121 3,751 3,737 4,334 4,621 40 88,,222244 16,226 16,057 15,774 16,240 15,898 15,832 15,695 16,099 16,516 41 China People's Republic of (China Mainland) 31 4 2222 9 1100 1122 4 4 5 3 42 China, Republic of (Taiwan) 140 500 737 860 863 908 939 981 991 1,099 43 Hong Kong 147 223 258 228 273 296 251 252 208 267 44 India 16 14 21 34 38 36 36 33 64 48 45 Indonesia 88 157 102 167 160 125 108 119 117 120 46 Israel 155 255 491 285 315 269 257 313 320 330 47 Japan 6,398 12,518 10,776 10,009 10,389 10,340 10,116 10,220 10,534 10,429 48 Korea 403 955 1,561 1,679 1,713 1,614 1,551 1,594 1,555 1,577 49 Philippines 181 372 384 559 524 389 459 472 478 495 50 Thailand 273 458 499 491 490 465 437 434 415 414 51 Middle East oil-exporting countries2 330 524 742 746 780 836 721 765 1,082 52 Other3 392 441 684 713 719 665 838 552 647 653 53 Africa 388 855 1,228 1,323 1,314 1,310 1,395 1,332 1,381 1,394 54 Egypt 35 111 101 104 117 117 115 114 106 109 55 Morocco 5 18 9 16 21 18 15 17 8 15 56 South Africa 129 329 545 672 689 698 695 691 772 748 57 Zaire 61 98 34 30 28 24 24 23 14 23 58 Oil-exporting countries4 115 231 211 181 185 268 176 215 211 59 Other3 158 185 308 291 279 269 277 312 266 288 60 286 565 609 615 647 617 638 631 661 625 61 Australia 243 466 535 547 548 542 553 521 558 502 62 All other 43 99 73 67 100 74 85 110 103 123 63 Nonmonetary international and regional 1 * 1 11 1 1 * 1122 6 6 1 Includes Surinam until January 1976. 3 Includes oil-exporting countries until December 1974. 2 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, 4 Comprises Algeria, Gabon, Libya, and Nigeria, and United Arab Emirates (Trucial States). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A61 3.19 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Banks in the United States By Type of Claim Millions of dollars outstanding; end of period 1976 Type 1973 1974 1975 May June July Aug. Sept. Oct.P NOV.P 1 Total 20,723 39,056 50,240 57,622 57,965 59,332 58,016 60,317 60,941 64,194 2 Payable in dollars 20,061 37,859 48,910 56,203 56,370 57,875 56,474 58,661 59,238 62,389 3 Loans, total 7,660 11,296 13,247 15,815 15,190 15,597 15,266 14,914 16,221 16,342 4 Official institutions, including central banks. 284 381 613 1,011 820 737 1,016 793 1,009 1,424 5 Banks, excluding central banks 4,538 7,337 7,705 9,537 9,130 9,670 9,059 9,003 10,067 9,614 6 All other, including nonmonetary international and regional organizations 2,838 3,579 4,928 5,267 5,240 5,190 5,191 5,118 5,144 5,304 7 Collections oustanding 4,307 5,637 5,467 5,379 5,517 5,542 5,495 5,746 5,586 5,735 8 Acceptances made for accounts of foreigners. 4,160 11,237 11,147 11,323 11,541 11,451 11,144 11,213 11,461 11,422 9 Other claims1 3,935 9,689 19,049 23,686 24,123 25,285 24,568 26,789 25,970 28,890 10 Payable in foreign currencies 662 1,196 1,329 1,419 1,595 1,457 1,542 1,656 1,704 1,805 11 Deposits with foreigners 428 669 656 885 954 850 903 1,029 11,,005522 11,,008844 12 Foreign government securities, commercial and finance paper 119 289 301 141 158 132 143 120 102 85 13 Other claims 115 238 372 393 484 475 496 507 550 635 1 Includes claims of U.S. banks on their foreign branches and claims made to, and acceptances made for, foreigners; drafts drawn against of U.S. agencies and branches of foreign banks on their head offices and foreigners, where collection is being made by banks and bankers for foreign branches of their head offices. 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. 3.20 LONG-TERM CLAIMS ON FOREIGNERS Reported by Banks in the United States Millions of dollars outstanding; end of period 1976 Type, and area or country 1973 1974 1975 May June July Aug. Sept. Oct.f NOV.P 1 5,996 7,179 9,540 10,266 10,216 10,386 10,960 11,205 11,345 11,611 By type: 2 Payable in dollars 5,924 7,099 9,423 10,151 10,094 10,253 10,827 11,064 11,206 11,457 3 Loans, total 5,446 66,,449900 8,489 9,018 8,957 9,098 9,603 9,552 9,670 9,829 4 Official institutions, including central banks 1,156 1,324 1,350 1,358 1,346 1,323 1,340 1,312 1,323 1,373 5 Banks, excluding central banks 591 929 1,740 1,945 1,961 2,085 2,220 2,039 2,115 2,159 6 All other, including nonmonetary international and regional organizations 3,698 4,237 5,399 5,715 5,650 55,,669900 6,043 6,201 6,232 66,,229977 7 Other long-term claims 478 609 934 1,133 1,138 1,155 1,224 1,512 1,536 1,629 8 Payable in foreign currencies 72 80 116 115 121 133 133 142 139 154 By area or country: 9 1,271 1,908 2,708 2,840 2,741 2,871 3,093 3,133 3,191 3,287 10 Canada 490 501 555 607 590 575 592 623 570 590 11 Latin America 2,116 2,614 3,468 3,973 4,081 4,103 4,383 4,519 4,565 4,691 12 1,582 1,619 1,795 1,769 1,766 1,810 1,835 1,856 1,900 1,891 13 Japan 251 258 296 307 324 337 355 370 381 369 14 Middle East oil-exporting countries1 384 220 196 182 183 187 171 171 141 15 Other Asia 2 1,331 977 1,279 1,266 1,260 1,290 1,293 1,316 1,348 1,382 16 Africa 355 366 747 797 736 742 771 800 839 882 17 Oil-exporting countries3 62 151 173 197 212 226 236 259 269 18 Other4 355 305 596 624 539 529 544 564 580 612 19 All other countries5 181 171 235 280 301 286 287 1 274 281 270 1 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, 3 Comprises Algeria, Gabon, Libya, and Nigeria. and United Arab Emirates (Trucial States). 4 Includes oil-exporting countries until December 1974. 2 Includes Middle East oil-exporting countries until December 1974. 5 Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 International Statistics • January 1977 3.21 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data Millions of dollars; end of period Assets 1976 Account 1973 1974 1975 Apr. May r Juner July Aug.r Sept. Oct.f All foreign countries 1 Total, all currencies 121,866 151,905 176,493 189,437 194,592 194,481 196,776 196,097 199,764 206,216 2 Claims on United States, total 5,091 6,900 6,743 9,054 9,610 6,613 8,703 7,169 6,677 10,133 3 Parent bank 1,886 4,464 3,665 6,049 6,450 3,272 5,569 3,927 3,247 7,021 4 Other 3,205 2,435 3,078 3,005 3,160 3,341 3,134 3,242 3,429 3,113 5 Claims on foreigners, total 111,974 138,712 163,391 173,827 178,215 181,239 181,239 182,232 186,065 188,968 6 Other branches of parent bank 19,177 27,559 34,508 39,563 39,982 40,975 41,682 40,959 41,133 41,523 7 Other banks 56,368 60,283 69,206 70,652 73,611 74,400 71,766 71,605 74,833 76,131 8 Official institutions 2,693 4,077 r5,792 r7,116 7,717 7,814 8,444 8,766 9,165 9,205 9 Nonbank foreigners r33,736 46,793 r53,886 r56,495 56,905 58,049 59,347 60,902 60,934 62,109 10 Other assets 4,802 6,294 6,359 6,557 6,767 6,629 6,834 6,695 7,022 7,115 11 Total payable in U.S. dollars 79,445 105,969 132,901 140,971 146,438 145,994 149,071 147,200 150,394 155,854 12 Claims on United States, total.. . . 4,599 6,603 6,408 8,759 9,294 6,296 8,434 6,855 6,317 9,789 13 Parent bank 1,848 4,428 3,628 5,980 6,374 3,203 5,524 3,888 3,184 6,976 14 Other 2,751 2,175 2,780 2,778 2,921 3,093 2,910 2,967 3,133 2,813 15 Claims on foreigners, total 73,018 96,209 123,496 129,141 133,900 136,629 137,246 137,139 140,831 142,724 16 Other branches of parent bank, 12,799 19,688 28,478 31,510 32,121 32,857 33,790 32,971 33,319 33,775 17 Other banks 39,527 45,067 55,319 54,496 57,532 58,856 56,603 56,226 58,877 59,239 18 Official institutions 1,777 3,289 r4,864 r6,061 6,553 6,611 7,148 7,606 7,906 7,885 19 Nonbank foreigners 18,915 28,164 r34,835 r37,075 37,695 38,304 39,704 40,337 40,729 41,824 20 Other assets 1,828 3,157 2,997 3,072 3,243 3,070 3,392 3,206 3,246 3,342 United Kingdom 21 Total, all currencies 61,732 69,804 74,883 74,055 75,926 74,460 73,494 73,229 73,589 76,854 22 Claims on United States, total 1,789 3,248 2,392 2,275 2,443 1,702 1,862 1,758 2,036 3,456 23 Parent bank 738 2,472 1,449 1,447 1,534 802 1,002 938 1,081 2,613 24 Other 1,051 776 943 827 909 900 860 821 955 843 25 Claims offoreigners, total 57,761 64,111 70,331 69,555 71,189 70,526 69,359 69,298 69,217 70,962 26 Other branches of parent bank 8,773 12,724 17,557 18,394 18,619 18,143 18,843 18,044 17,745 18,158 27 Other banks 34,442 32,701 35,904 34,879 36,270 35,799 33,589 34,135 34,405 35,336 28 Official institutions 735 788 881 934 851 888 909 1,007 1,138 1,211 29 Nonbank foreigners 13,811 17,898 15,990 15,348 15,499 15,695 16,018 16,112 15,929 16,257 30 Other assets 2,183 2,445 2,159 2,226 2,294 2,233 2,273 2,173 2,335 2,436 31 Total payable in U.S. dollars 40,323 49,211 57,361 54,516 56,667 55,360 54,871 54,522 54,547 57,161 32 Claims on United States, total 1,642 3,146 2,273 2,155 2,322 1,614 1,780 1,658 1,902 3,324 33 Parent bank 730 2,468 1,445 1,434 1,519 795 997 934 1,064 2,606 34 Other 912 678 828 721 803 819 783 724 838 719 35 Claims on foreigners, total 37,817 44,694 54,121 r51,470 r53,467 52,900 52,250 52,006 51,782 52,912 36 Other branches of parent bank 6,509 10,265 15,645 15,424 15,860 15,455 16,204 15,401 15,195 15,629 37 Other banks 23,389 23,716 28,224 25,820 27,218 27,066 25,370 25,826 25,866 26,421 38 Official institutions 510 610 648 633 635 631 659 799 862 912 39 Nonbank foreigners 7,409 10,102 9,604 9,593 9,754 9,747 10,018 9,980 9,859 9,950 40 Other assets 865 1,372 967 891 879 846 841 858 863 925 Bahamas and Caymans 41 Total, all currencies 13,111 31,733 45,203 54,398 57,247 57,118 59,913 51,611 60,753 63,507 42 Claims on United States, total 2,210 2,464 3,229 5,695 5,884 3,716 5,835 3,750 3,378 5,464 43 Parent bank 317 1,081 1,477 3,835 3,950 1,636 3,864 1,641 1,257 3,483 44 Other 1,893 1,383 1,752 1,860 1,935 2,081 1,971 2,109 2,121 1,981 45 Claims on foreigners, total 21,041 28,453 41,040 47,536 50,040 52,363 52,898 52,737 56,206 56,806 46 Other branches of parent bank, 1,928 3,478 5,411 6,437 6,435 1,25 A 7,149 6,791 7,250 7,296 47 Other banks 9,895 11,354 16,298 18,503 20,173 21,205 20,669 20,021 22,447 22,136 48 Official institutions 1,151 2,022 3,576 4,680 5,091 5,160 5,699 5,929 6,059 6,040 49 Nonbank foreigners 8,068 11,599 15,756 17,917 18,342 18,744 19,381 19,995 20,449 21,334 50 Other assets 520 815 933 1,166 1,322 1,039 1,180 1,190 1,169 1,238 51 Total payable in U.S. dollars 21,937 28,726 41,887 50,655 53,545 53,365 56,076 53,520 56,600 59,217 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Overseas Branches A63 3.21 Continued Liabilities 1976 Account 1973 1974 1975 Apr. May r Juner July Aug.r Sept. Oct.? All foreign countries 1 Total, all currencies 121,866 151,905 176,493 189,437 194,592 194,481 196,776 196,097 199,764 206,216 2 To United States, total 5,610 11,982 20,221 26,755 28,272 27,968 28,620 27,116 30,146 29,541 3 Parent bank 1,642 5,809 12,165 14,543 15,918 16,502 15,951 16,493 19,045 17,953 4 Other 3,968 6,173 8,057 12,212 12,354 11,467 12,669 10,623 11,101 11,588 5 To foreigners, total 111,615 132,990 149,815 156,870 160,261 160,364 161,543 162,635 163,161 170,017 6 Other branches of parent bank, 18,213 26,941 34,111 38,811 38,994 39,969 41,061 40,064 40,115 41,040 7 Other banks 65,389 65,675 72,259 72,720 75,919 75,527 74,189 74,348 75,033 78,879 8 Official institutions 10,330 20,185 22,773 21,857 22,467 21,605 22,233 23,393 23,700 25,046 9 Nonbank foreigners 17,683 20,189 20,672 23,482 22,881 23,262 24,060 24,829 24,312 25,052 10 Other liabilities 4,641 6,933 6,456 5,812 6,059 6,148 6,612 6,346 6,458 6,658 11 Total payable in U.S. dollars 80,374 107,890 135,907 145,817 151,124 150,502 153,175 151,749 155,109 160,333 12 To United States, total 5,027 11,437 19,503 26,011 27,572 27,167 27,854 26,348 29,258 28,779 13 Parent bank 1,477 5,641 11,939 14,286 15,657 16,229 15,697 16,254 18,714 17,719 14 Other 3,550 5,795 7,564 11,725 11,914 10,938 12,157 10,094 10,544 11,060 15 To foreigners, total 73,189 92,503 112,879 116,743 120,445 120,145 121,944 122,148 122,558 128,250 16 Other branches of parent bank, 12,554 19,330 28,217 31,428 31,661 32,758 33,850 32,687 32,919 33,848 17 Other banks 43,641 43,656 51,583 51,679 54,559 54,085 53,568 53,298 53,500 56,290 18 Official institutions 7,491 17,444 19,982 19,080 19,791 19,036 19,580 20,585 20,756 21,848 19 Nonbank foreigners 9,502 12,072 13,097 14,557 14,434 14,266 14,947 15,579 15,382 16,264 20 Other liabilities 2,158 3,951 3,526 3,063 3,107 3,190 3,377 3,252 3,294 3,304 United Kingdom 21 Total, all currencies 61,732 69,804 74,883 74,055 75,926 74,460 73,494 73,229 73,589 76,854 22 To United States, total 2,431 3,978 5,646 6,105 6,483 5,874 5,628 5,266 5,379 5,310 23 Parent bank 136 510 2,122 1,764 1,796 1,562 1,727 1,520 1,442 1,468 24 Other 2,295 3,468 3,523 4,340 4,687 4,312 3,901 3,746 3,938 3,842 25 To foreigners, total 57,311 63,409 67,240 65,977 67,212 66,536 65,594 65,883 66,026 69,151 26 Other branches of parent bank 3,944 4,762 6,494 6,898 7,030 7,288 6,927 6,668 6,788 6,826 27 Other banks 34,979 32,040 32,964 31,805 33,189 33,313 31,487 30,834 31,015 32,488 28 Official institutions 8,140 15,258 16,553 15,521 15,782 14,825 15,462 16,147 16,389 17,567 29 Nonbank foreigners 10,248 11,349 11,229 11,752 11,212 11,110 11,718 12,234 11,834 12,270 30 Other liabilities 1,990 2,418 1,997 1,974 2,231 2,050 2,272 2,080 2,184 2,394 31 Total payable in U.S. dollars 39,689 49,666 57,820 55,750 57,923 56,574 55,978 55,701 55,625 58,031 32 To United States, total 2,173 3,744 5,415 5,880 6,271 5,682 5,443 5,093 5,183 5,152 33 Parent bank 113 484 2,083 1,723 1,759 1,546 1,703 1,498 1,404 1,448 34 Other 2,060 3,261 3,332 4,156 4,513 4,136 3,740 3,595 3,779 3,704 35 To foreigners, total 36,646 44,594 51,447 48,992 50,727 50,044 49,691 49,746 49,579 52,017 36 Other branches of parent bank 2,519 3,256 5,442 5,771 5,863 6,218 5,878 5,604 5,790 5,742 37 Other banks 22,051 20,526 23,330 21,230 22,544 22,690 21,765 20,910 20,526 21,493 38 Official institutions 5,923 13,225 14,498 13,450 13,914 13,074 13,604 14,296 14,418 15,550 39 Nonbank foreigners 6,152 7,587 8,176 8,541 8,406 8,062 8,444 8,936 8,846 9,233 40 Other liabilities 870 1,328 959 877 925 848 844 862 862 862 Bahamas and Caymans 41 Total, all currencies 23,771 31,733 45,203 54,398 57,247 57,118 59,913 SI,677 60,753 63,507 42 To United States, total 1,573 4,815 11,147 16,872 18,286 18,286 19,370 18,237 21,388 20,734 43 Parent bank 307 2,636 7,628 9,904 11,529 12,203 11,611 12,311 15,333 14,094 44 Other 1,266 2,180 3,520 6,968 6,757 6,083 7,759 5,927 6,055 6,640 45 To foreigners, total 21,747 26,140 32,949 36,553 38,112 37,817 39,411 38,380 38,331 41,815 46 Other branches of parent bank.. 5,508 7,702 10,569 11,903 11,918 12,117 13,317 12,416 11,854 13,381 47 Other banks 14,071 14,050 16,825 18,907 20,303 19,724 20,350 20,125 20,621 22,240 48 Official institutions 492 2,377 3,308 2,970 2,950 2,917 2,811 2,857 2,712 2,784 49 Nonbank foreigners 1,676 2,011 2,248 2,774 2,941 3,059 2,933 2,982 3,144 3,409 50 Other liabilities 451 778 1,106 972 849 1,016 1,131 1,059 1,035 958 51 Total payable in U.S. dollars 22,328 28,840 42,197 51,185 54,160 53,834 56,636 54,154 57,232 59,970 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 International Statistics • January 1977 3.22 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Holdings and Transactions Millions of dollars 11997766 1976 Country or area 11997744 11997755 JJaann..-- NNoovv..ff May June July Aug. Sept. Oct.f Nov.f Holding, end of period 4 1 Estimated total. . 5,708 7,703 9,403 10,608 11,419 12,147 13,462 14,482 15,058 2 Foreign countries. 5,557 7,372 9,254 10,026 10,350 10,746 11,671 11,954 12,337 Europe 885 1,085 1,443 1,566 1,604 1,733 2,024 2,064 2,293 Belgium-Luxembourg.. 10 13 13 12 11 9 9 13 14 Germany 9 215 225 227 221 324 518 535 746 Netherlands 6 16 208 283 283 283 282 283 288 Sweden 251 276 281 291 291 275 240 242 192 Switzerland 30 55 99 101 132 171 268 267 291 9 United Kingdom 493 363 349 380 368 383 396 403 433 10 Other Western Europe. 81 143 264 268 294 284 307 317 325 11 Eastern Europe 5 4 4 4 4 4 4 4 4 12 Canada. 713 395 340 340 341 337 386 390 250 13 Latin America 100 200 166 182 203 271 178 160 302 14 Latin American republics . 12 33 34 34 39 39 30 36 177 15 Netherlands Antilles1 83 161 125 141 157 222 138 113 115 16 Asia. 3,709 5,370 6,875 7,466 7,701 7,883 8,552 8,808 8,950 17 Japan. 3,498 3,271 3,074 3,075 3,077 2,952 3,052 3,093 2,587 18 Africa. .. 151 321 431 471 501 521 531 531 543 19 All other. * * * * * * * * * 20 Nonmonetary international and regional organizations 151 331 149 582 1,068 1,401 1,791 2,528 2,721 21 International 97 322 149 582 1,065 1,388 1,768 2,504 2,655 22 Latin American regional. 53 9 * * 3 13 23 23 66 Transactions, net purchases, or sales ( —), during period 23 Total -472 1,994 7,356 238 1,205 810 729 1,315 1,019 577 24 Foreign countries -573 1,814 4,965 245 772 324 396 925 283 383 25 Official institutions -642 1,612 4,695 263 717 294 316 964 227 340 26 Other foreign 69 202 270 -18 55 31 80 -39 56 43 27 Nonmonetary international and regional organizations 101 180 2,391 -7 434 486 333 390 736 193 MEMO: Oil-exporting countries 28 Middle East2 1,797 3,737 460 611 246 228 315 9988 666333000 29 Africa3 117700 222211 2200 4400 3300 2200 1100 111111 1 Includes Surinam until January 1976. 4 Estimated official and private holdings of marketable U.S. Treasury 2 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, securities with an original maturity of more than 1 year. Data are based and United Arab Emirates (Trucial States). Data not available until 1975. on a benchmark survey of holdings as of Jan. 31, 1971, and monthly 3 Comprises Algeria, Gabon, Libya, and Nigeria. Data not available transactions reports. Excludes nonmarketable U.S. Treasury bonds and until 1975. notes held by official institutions of foreign countries. 3.23 FOREIGN OFFICIAL ACCOUNTS Millions of dollars outstanding, end of period 1976 HHeelldd aatt FFeeddeerraall RReesseerrvvee BBaannkkss 11997733 11997744 11997755 June July Aug. Sept. Oct. Nov. Dec. 1 Deposits 251 418 352 349 295 254 393 362 305 352 Assets held in custody: 2 U.S. Treasury securities1 52,070 55,600 60,019 63,212 62,955 63,457 64,215 64,942 63,962 66,532 3 Earmarked gold2 17,068 16,838 16,745 16,633 16,607 16,565 16,590 16,505 16,457 16,414 1 Marketable U.S. Treasury bills, certificates of indebtedness, notes, NOTE.—Excludes deposits and U.S. Treasury securities held for interand bonds; and nonmarketable U.S. Treasury securities payable in dollars national and regional organizations. Earmarked gold is gold held for and in foreign currencies. foreign and international accounts and is not included in the gold stock 2 The value of earmarked gold increased because of the changes in of the United States. par value of the U.S. dollar in May 1972 and in October 1973. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Official Accounts A65 3.24 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 11997766 1976 Transactions, and area or country 11997744 11997755 JJaann..-- NNoovv..ff May June July Aug. Sept. Oct.f NOV.p U.S. corporate securities3 Stocks: 1 Purchases. 7,636 15,347 16,641 1,212 1,432 1,595 1,050 1,124 1,226 974 2 Sales 7,096 10,678 14,177 1,097 1,178 1,363 962 1,116 1,321 1,022 3 Net purchases, or sales ( —). 540 4,669 2,466 115 254 232 88 9 -95 -48 4 Foreign countries 527 4,651 2,446 115 252 233 85 7 -98 -50 5 Europe 281 2,491 222 -9 -47 -32 -19 -60 -251 -117 6 France 203 262 220 3 24 72 28 23 -12 -23 7 Germany 39 251 47 -44 -27 -20 -11 -6 -16 -13 8 Netherlands 330 359 -166 4 2 -22 -21 -26 -37 -29 9 Switzerland 36 899 -96 21 -47 -58 -11 -55 -95 -43 10 United Kingdom. -377 594 255 20 20 5 12 29 -72 -6 11 Canada -6 361 255 30 -5 44 35 5 18 1 12 Latin America. . -33 -7 155 6 11 3 -24 10 -17 24 13 Middle East1. . . 1,640 11,,668888 67 266 209 92 60 126 64 14 Other Asia2 288 142 110088 16 20 10 -2 -4 28 -23 15 Africa -6 10 7 1 3 -3 3 -4 -3 1 16 Other countries. 3 15 13 4 3 1 2 * 1 * 17 Nonmonetary international and regional organizations 13 18 20 * 2 -2 3 2 4 2 18 Bo P nd u s r c 3 h : ases. 8,571 5,393 4,990 427 391 307 411 361 625 355 19 Sales 7,582 4,641 3,754 404 155 154 232 375 358 356 20 Net purchases, or sales ( — ). 988 752 1,233 22 236 153 179 -14 267 -1 21 Foreign countries 1,472 1,782 1,274 35 236 161 173 -9 203 113 2 2 3 2 Eu F r r o a p n e c e 74 9 1 6 1 8 0 2 6 3 6 9 7 -2 3 29 6 4 1 9 0 2 4 9 - - 1 1 6 — 19 1 24 5 24 Germany 33 -11 -49 -2 -1 -3 -3 * 5 4 25 Netherlands 183 15 -2 * -2 4 -3 * 1 3 2 2 6 7 S U w n i i t t z e e d r l K an i d n gdom. 3 9 9 6 5 1 8 1 7 7 16 6 7 2 1 3 9 1 8 8 3 3 5 2 1 3 6 -7 7 20 * -3 1 5 28 Canada 45 128 91 -3 1 2 9 18 -1 16 29 Latin America. . 4433 31 66 -3 * 7 9 5 29 6 30 Middle East1. . . 1,553 1,200 37 224 104 121 18 156 74 31 Other Asia2 632 -42 -116 6 -19 -2 5 -15 2 -5 32 Africa * 5 -12 * * 1 * -19 -2 -2 33 Other countries. 10 1 -20 * * * * * * * 34 Nonmonetary international and regional organizations -483 -1,030 -41 -13 * -8 6 -4 64 -115 Foreign securities 35 Stocks, net purchases, or sales ( —) 184 -189 -325 -42 -44 -129 -11 -27 -1 -1 36 Purchases 1,907 1,541 1,718 198 162 128 123 126 132 167 37 Sales 1,723 1,730 2,044 240 206 257 134 153 133 168 38 Bonds, net purchases, or sales ( —) -2,218 -6,301 -7,219 -449 -532 -1,734 -478 -427 -367 -394 39 Purchases 1,036 2,383 4,262 373 281 440 333 363 452 455 40 Sales 3,254 8,683 11,480 822 813 2,173 811 790 819 849 41 Net purchases, or sales ( —) of stocks and bonds -2,034 -6,490 -7,547 -491 -576 -1,862 -489 -454 -369 -396 42 Foreign countries -1,974 -4,299 -6,178 -333 -582 -1,044 -423 -471 -282 -264 43 Europe -546 -53 -695 -19 -52 -130 -60 -145 -37 -9 44 Canada -1,508 -3,178 -4,465 -233 -328 -853 -98 -331 -301 -20 45 Latin America -93 -306 -30 -39 10 19 47 20 13 -29 46 Asia 142 -622 -616 -77 12 -93 -317 -16* 34 -9 * 47 Africa 7 15 46 32 11 9 1 1 48 Other countries 22 -155 -418 3 -234 3 3 2 9 -197 49 Nonmonetary international and regional organizations -60 -2,192 -1,369 -158 6 -819 -66 17 -87 -132 1 Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, 3 Includes State and local government securities, and securities of U.S. Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial Govt, agencies and corporations. Also includes issues of new debt securities States). sold abroad by U.S. corporations organized to finance direct investment 2 Includes Middle East oil-exporting countries until 1975. abroad. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A66 International Statistics • January 1977 3.25 SHORT-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars outstanding; end of period 1974 1975 1976 1974 1975 1976 Type, and area or country Dec. June Sept. Dec. Mar.P Dec. June Sept. Dec. Mar.25 Liabilities to foreigners Claims on foreigners 1 Total 5,916 5,924 5,997 5,958 6,264 11,276 10,886 11,712 12,244 12,808 By type: 2 Payable in dollars 5,007 5,091 5,149 5,353 5,598 10,219 9,606 10,364 11,069 11,759 3 Payable in foreign currencies 909 834 849 605 666 11,,005588 1,281 11,,334488 11,,117766 1,049 4 Deposits with banks abroad in reporter's name 473 479 529 565 487 Other 558844 880011 881199 661111 556622 By area or country: 6 5,758 5,667 5,730 5,683 6,046 11,276 10,885 11,712 12,243 12,807 7 Europe 3,007 2,545 2,518 2,304 2,327 4,467 3,761 4,238 4,519 4,970 8 Austria 20 22 18 14 6 26 13 15 16 11 9 Belgium-Luxembourg 519 340 336 294 286 128 132 131 133 116 10 Denmark 24 14 8 9 12 42 22 24 39 35 11 Finland 16 12 14 14 10 120 87 114 91 36 12 France 202 137 150 148 204 430 287 311 300 372 13 313 293 276 151 153 339 346 319 357 306 14 Greece 39 27 21 19 25 65 69 56 33 40 15 Italy 125 110 156 173 126 397 300 380 382 408 16 Netherlands 119 143 154 115 161 148 135 139 172 182 17 Norway 9 8 13 20 23 36 41 48 41 58 18 Portugal 19 13 13 4 3 81 32 39 44 45 19 Spain 57 60 75 82 70 369 324 315 408 514 20 Sweden 38 30 47 24 22 89 74 100 62 80 21 Switzerland 138 168 167 130 159 136 113 220 242 207 22 Turkey 8 14 22 25 14 26 28 31 27 27 23 United Kingdom 1,251 1,054 945 970 923 1,851 1,555 1,781 1,905 2,291 24 Yugoslavia 40 45 60 76 91 22 32 24 36 30 25 Other Western Europe 5 4 5 6 6 21 16 19 14 18 26 U.S.S.R 48 34 31 20 23 91 91 101 149 106 27 Other Eastern Europe 16 15 7 11 10 50 62 69 70 80 28 Canada 307 283 299 295 314 1,618 1,954 2,102 2,124 2,235 29 926 973 924 903 1,170 2,316 2,171 2,205 2,337 2,546 30 Argentina 36 30 28 31 35 67 63 52 58 48 31 Bahamas 372 357 290 270 376 594 631 686 662 882 32 Brazil 118 127 116 96 91 463 349 385 403 470 33 Chile 22 15 13 14 11 106 57 41 38 28 34 Colombia 14 12 14 17 16 54 50 Al 49 Al 35 Cuba * * * * * 1 1 1 1 1 36 Mexico 60 71 81 82 92 302 322 317 352 331 37 28 27 19 24 17 132 128 103 92 86 38 Peru 14 16 19 23 24 44 50 48 41 36 39 Uruguay 2 3 2 3 2 5 5 5 4 4 40 Venezuela 49 45 56 100 163 190 166 153 167 147 41 Other Latin American republics 83 67 69 71 72 193 179 165 157 167 42 26 60 76 35 58 20 13 12 12 7 43 101 145 142 138 213 147 159 192 301 292 44 Asia 1,239 11,,448888 1,575 1,717 1,667 22,,333366 22,,449977 22,,665522 22,,668833 22,,554466 45 China, People's Republic of (China Mainland) 17 6 2 6 5 17 32 45 65 35 46 China, Republic of (Taiwan) 93 100 101 97 111 139 125 152 164 100 47 19 30 29 18 24 63 85 85 111 67 48 India 7 21 22 7 9 37 39 48 39 60 49 Indonesia 60 87 104 137 137 92 147 137 169 194 50 Israel 50 62 45 29 23 44 60 63 54 42 51 Japan 348 273 279 296 308 1,239 1,250 1,269 1,141 1,170 52 Korea 75 43 63 69 54 201 178 207 265 108 53 25 17 15 14 19 95 91 93 99 106 54 Thailand 10 6 8 18 18 24 25 21 22 21 55 536 841 908 1,027 958 384 465 532 555 643 56 Africa 193 323 341 391 502 374 364 388 440 378 57 Egypt 3 34 34 37 30 15 15 15 22 22 58 Morocco 14 6 8 8 7 7 9 10 10 10 59 South Africa 43 65 79 100 112 101 104 78 93 79 60 Zaire 18 9 9 6 7 24 17 22 28 28 61 Other Africa 115 209 212 240 347 227 218 263 287 239 62 Other countries 86 55 73 73 65 165 138 127 140 133 63 Australia 56 37 52 55 47 116 99 19 101 96 64 All other 30 18 21 17 18 49 39 48 39 37 65 Nonmonetary international and regional organizations 158 257 267 276 219 * 1 * 1 1 1 Includes Surinam until 1976. mercial concerns and other nonbanking institutions in the United States. Data exclude claims held through U.S. banks and intercompany accounts NOTE.—Reported by exporters, importers, and industrial and com- between U.S. companies and their affiliates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A67 3.26 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Large Nonbanking Concerns in the United States Millions of dollars outstanding; end of period 1976 Type and country 1973 1974 1975 Apr. May June July Aug. Sept v Oct.? 1 3,164 3,357 3,791 4,968 5,201 4,939 5,190 5,111 4,660 4,869 By type : 2 Payable in dollars 2,625 2,660 3,035 4,267 4,512 4,308 4,552 4,507 3,987 4,284 3 Deposits 2,588 2,591 2,703 3,855 4,086 3,963 4,172 4,088 3,617 3,893 4 Short-term investments1 37 69 332 412 426 345 380 419 370 391 5 Payable in foreign currencies 540 697 756 700 689 631 638 604 673 586 6 Deposits 435 429 510 433 452 433 431 377 445 344 7 Short-term investments1 105 268 246 267 237 199 207 227 228 242 By country: 8 United Kingdom 1,118 1,350 1,304 2,061 1,912 1,908 2,060 2,064 1,690 1,641 9 Canada 765 967 1,153 1,381 1,521 1,274 1,415 1,393 1,305 1,400 10 Bahamas 589 390 546 873 1,035 1,029 918 823 805 1,059 11 Japan 306 398 343 235 245 190 139 137 146 116 12 All other 386 252 445 418 488 538 658 694 714 653 1 Negotiable and other readily transferable foreign obligations payable NOTE.—Data represent the assets abroad of large nonbanking conon demand or having a contractural maturity of not more than 1 year cerns in the United States. They are a portion of the total claims on from the date on which the obligation was incurred by the foreigner. foreigners reported by nonbanking concerns in the United States and are included in the figures shown in Table 3.25. 3.27 LONG-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars outstanding; end of period 1974 1975 1976 1974 1975 1976 AArreeaa aanndd ccoouunnttrryy Dec. June Sept. Dec. Mar. Dec. June Sept. Dec. Mar. Liabilities to foreigners Claims on foreigners 1 Total 3,850 4,230 4,180 4,232 4,046 4,544 4,454 4,590 4,971 5,160 2 Europe 2,996 3,241 3,188 3,237 3,086 1,007 933 985 985 934 3 Germany 474 507 460 499 438 23 23 19 26 24 4 Netherlands 220 225 212 204 214 280 277 273 217 220 5 Switzerland 572 574 525 505 467 44 57 59 55 52 6 United Kingdom 1,240 1,442 1,529 1,616 1,584 364 299 366 396 348 7 Canada 110 110 145 164 153 1,290 1,328 1,347 1,426 1,474 8 Latin America 214 318 284 267 245 1,384 1,325 1,334 1,638 1,767 9 Bahamas 111 277 242 210 184 19 8 7 8 7 10 Brazil 3 3 3 4 5 187 182 177 171 182 11 Chile 1 1 1 1 1 435 336 315 315 313 12 Mexico 3 3 3 3 6 153 161 228 216 199 13 Asia 460 488 495 496 495 681 655 703 694 710 14 367 393 401 397 394 112 98 95 90 91 15 Africa 6 2 2 2 2 127 146 154 168 214 16 All other i 65 72 66 66 65 54 68 67 61 62 1 Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 International Statistics • January 1977 3.28 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Per cent per annum Rate as of Rate as of Rate as of Dec. 31, 1976 Dec. 31, 1976 Dec. 31, 1976 Country Country Country Per Month Per Month Per Month cent effective cent effective cent effective Argentina 18.0 Feb.1972 France 10.5 Sept. 1976 Norway 6.0 Sept. 1976 Austria... 4.0 June 1976 Germany, Fed. Rep. of. 3.5 Sept. 1975 Sweden 8.0 Oct. 1976 Belgium. . 9.0 Aug. 1976 Italy 15.0 Oct. 1976 Switzerland 2.0 June 1976 Brazil 28.0 May 1976 Japan 6.5 Oct. 1975 United Kingdom 14.25 Dec. 1976 Canada.. 8.5 Dec. 1976 Mexico 4.5 June 1942 Venezuela 5.0 Oct. 1970 Denmark. 10.0 Dec. 1976 Netherlands 6.0 Nov. 1976 NOTE.—Rates shown are mainly those at which the central bank either more than one rate applicable to such discounts or advances, the rate discounts or makes advances against eligible commercial paper and/or shown is the one at which it is understood the central bank transacts the govt, securities for commercial banks or brokers. For countries with largest proportion of its credit operations. 3.29 FOREIGN SHORT-TERM INTEREST RATES Per cent per annum; averages of daily figures 1976 CCoouunnttrryy,, oorr ttyyppee 11997744 11997755 11997766 July Aug. Sept. Oct. Nov. Dec. 1 Euro-dollars 11.01 7.02 5.58 5.79 5.68 5.53 5.46 5.29 5.01 2 United Kingdom 13.34 10.63 11.35 11.19 11.07 12.11 14.57 14.75 14.27 3 Canada 10.47 8.00 9.39 9.48 9.54 9.40 9.34 9.08 8.51 99..8800 4.87 4.19 4.36 4.51 4.57 4.76 4.61 4.82 5 Switzerland 3.01 1.45 1.09 1.17 1.40 1.80 2.12 1.98 6 Netherlands 5.17 7.02 8.38 12.92 12.67 10.23 8.22 6.51 7 France . 7.91 8.65 8.49 9.58 9.53 10.39 10.41 10.55 8 Italy . 10.37 16.32 18.55 17.43 16.83 18.61 17.76 17.13 6.63 10.25 9.10 11.55 13.90 13.94 12.48 10.73 10 Japan 1111..6644 77..7700 77..7755 7.75 7.50 7.50 8.00 8.00 NOTE.—Rates are for 3-month interbank loans except for—Canada, over; and Japan, loans and discounts that can be called after being held finance company paper; Belgium, time deposits of 20 million francs and over a minimum of two month-ends. 3.30 FOREIGN EXCHANGE RATES Cents per unit of foreign currency 1976 CCoouunnttrryy ((ccuurrrreennccyy)) 11997744 11997755 11997766 July Aug. Sept. Oct. Nov. Dec. 1 Australia (dollar) 143.89 130.77 122.15 123.59 124.18 124.25 123.40 120.66 105.29 2 Austria (shilling) 5.3564 5.7467 5.5744 5.4500 5.5645 5.6567 5.7960 5.8332 5.9061 3 Belgium (franc) 2.5713 2.7253 2.5921 2.5182 2.5632 2.6046 2.6822 2.7047 2.7483 4 Canada (dollar) 102.26 98.30 101.41 102.86 101.49 102.56 102.81 101.46 98.204 5 Denmark (krone) 16.442 17.437 16.546 16.225 16.448 16.954 16.968 16.934 17.145 6 Finland (markka) 26.565 27.285 25.938 25.750 25.754 25.781 25.938 26.073 26.315 7 France (franc) 20.805 23.354 20.942 20.651 20.131 20.334 20.072 20.042 20.055 8 Germany (deutsche mark). 38.723 40.729 39.737 38.842 39.538 40.169 41.165 41.443 41.965 9 India (rupee) 12.460 11.926 11.148 11.205 11.143 11.036 11.243 11.155 11.296 10 Ireland (pound) 234.03 222.16 180.48 178.50 178.28 172.72 163.77 163.81 167.84 11 Italy (lira) .15372 .15328 .12044 .11943 .11936 .11837 .11684 .11554 .11521 12 Japan (yen) .34302 .33705 .33741 .33940 .34410 .34800 .34344 .33879 .33933 13 Malaysia (ringgit) 41.682 41.753 39.340 39.589 40.077 39.753 39.575 39.513 39.550 14 Mexico (peso) 8.0000 8.0000 6.9161 8.0000 8.0000 5.0286 4.8535 4.0200 4.8626 15 Netherlands (guilder) 37.267 39.632 37.846 36.643 37.393 38.390 39.265 39.678 40.240 16 New Zealand (dollar) 140.02 121.16 99.115 99.049 99.657 98.869 98.484 95.392 92.179 17 Norway (krone) 18.119 19.180 18.327 17.899 18.150 18.427 18.812 18.954 19.193 18 Portugal (escudo) 3.9506 3.9286 3.3159 3.1810 3.1982 3.2062 3.1920 3.1742 3.1674 19 South Africa (rand) 146.98 136.47 114.85 114.83 114.84 114.77 114.85 114.88 114.95 20 Spain (peseta) 1.7337 1.7424 1.4958 1.4685 1.4651 1.4721 1.4675 1.4626 1.4634 21 Sri Lanka (rupee) 14.978 14.385 11.908 11.469 11.504 11.516 11.453 11.479 11.246 22 Sweden (krona) 22.563 24.141 22.957 22.379 22.660 22.998 23.511 23.699 24.051 23 Switzerland (franc) 33.688 38.743 40.013 40.242 40.302 40.431 40.876 40.958 40.823 24 United Kingdom (pound).. 234.03 222.16 180.48 178.50 178.28 172.72 163.77 163.81 167.84 25 MEMO: United States (dollar) i 84.11 82.20 89.68 90.69 90.46 90.25 90.88 91.06 90.55 1 Index of weighted-average exchange value of U.S. dollar against cur- NOTE.—Averages of certified noon buying rates in New York for cable rencies of other G-10 countries plus Switzerland. May 1970 parities = 100. transfers. Weights are 1972 global trade of each of the 10 countries. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A69 Board of Governors and Staff are shown on following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

>-J o Board of Governors of the Federal Reserve System ARTHUR F. BURNS, Chairman STEPHEN S. GARDNER, Vice Chairman HENRY C. WALLICH 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 JOHN H. KALCHBRENNER, Associate Director JAMES L. KICHLINE, Associate Director JOSEPH S. ZEISEL, Associate Director EDWARD C. ETTIN, Adviser LEGAL DIVISION ELEANOR J. STOCKWELL, Adviser JAMES B. ECKERT, Associate Adviser JOHN D. HAWKE, JR., General Counsel tJoHN J. MINGO, Associate Adviser DIVISION OF FEDERAL RESERVE BALDWIN B. TUTTLE, Deputy General J. CORTLAND G. PERET, Associate Adviser BANK EXAMINATIONS AND BUDGETS Counsel HELMUT F. WENDEL, Associate Adviser ROBERT E. MANNION, Assistant General JAMES R. WETZEL, Associate Adviser WILLIAM H. WALLACE, Director Counsel JAMES M. BRUNDY, Assistant Adviser ALBERT R. HAMILTON, Associate Director ALLEN L. RAIKEN, Assistant General Counsel JARED J. ENZLER, Assistant Adviser CLYDE H. FARNSWORTH, JR., Assistant Director GARY M. WELSH, Assistant General Counsel ROBERT M. FISHER, Assistant Adviser JOHN F. HOOVER, 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 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DIVISION OF DIVISION OF CONSUMER AFFAIRS DIVISION OF INTERNATIONAL FINANCE FEDERAL RESERVE BANK OPERATIONS JANET O. HART, Director JOHN E. REYNOLDS, Acting Director JAMES R. KUDLINSKI, Director NATHANIEL E. BUTLER, Associate Director ROBERT F. GEMMILL, Adviser WALTER A. ALTHAUSEN, Assistant Director JERAULD C. KLUCKMAN, Associate Director REED J. IRVINE, Adviser BRIAN M. CAREY, Assistant Director THELEN B. JUNZ, Adviser SAMUEL PIZER, Adviser HARRY A. GUINTER, Assistant Director OFFICE OF THE SECRETARY GEORGE B. HENRY, Associate Adviser CHARLES J. SIEGMAN, Associate Adviser DIVISION OF DATA PROCESSING THEODORE E. ALLISON, Secretary EDWIN M. TRUMAN, Associate Adviser *RICHARD D. ABRAHAMSON CHARLES L. HAMPTON, Director GRIFFITH L. GARWOOD, Assistant Secretary BRUCE M. BEARDSLEY, Associate Director UYLESS D. BLACK, Assistant Director GLENN L. CUMMINS, Assistant Director DIVISION OF BANKING ton leave of absence. ROBERT J. ZEMEL, Assistant Director SUPERVISION AND REGULATION DIVISION OF PERSONNEL BRENTON C. LEAVITT, Director JOHN E. RYAN, Associate Director DAVID L. SHANNON, Director WILLIAM W. WILES, Associate Director CHARLES W. WOOD, Assistant Director PETER E. BARNA, Assistant Director FREDERICK R. DAHL, Assistant Director OFFICE OF THE CONTROLLER JACK M. EGERTSON, Assistant Director JOHN N. LYON, Assistant Director JOHN KAKALEC, Controller JOHN T. MCCLINTOCK, Assistant Director TYLER E. WILLIAMS, JR., Assistant Controller THOMAS E. MEAD, Assistant Director THOMAS A. SIDMAN, Assistant Director DIVISION OF ADMINISTRATIVE SERVICES WALTER W. KREIMANN, Director DONALD E. ANDERSON, Assistant Director *°n loan from the Federal Reserve Bank of Chicago. JOHN D. SMITH, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A72 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. WALLICH PHILIP E. COLDWELL MONROE KIMBREL WILLIS 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 EDWARD BYRON SMITH, SEVENTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT WALTER B. WRISTON, SECOND FEDERAL DONALD E. LASATER, EIGHTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT ROGER S. HILL AS, THIRD FEDERAL RICHARD H. VAUGHAN, NINTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT M. BROCK WEIR, FOURTH FEDERAL J. W. MCLEAN, TENTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT JOHN H. LUMPKIN, FIFTH FEDERAL BEN F. LOVE, ELEVENTH FEDERAL RESERVE DISTRICT RESERVE DISTRICT FRANK A. PLUMMER, SIXTH FEDERAL GILBERT F. BRADLEY, TWELFTH 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

A73 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 Paul A. Miller John T. Keane PHILADELPHIA 19105 John W. Eckman David P. Eastburn Werner C. Brown 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 Robert C. Edwards 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 William H. Martin, III Hiram J. Honea Jacksonville 32203 Gert H. W. Schmidt Edward C. Rainey Miami 33152 David G. Robinson W. M. Davis Nashville 37203 John C. Bolinger Jeffrey J. Wells New Orleans 70161 George C. Cortright, Jr. 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 James C. Hendershot 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 Patricia P. Douglas John D. Johnson KANSAS CITY 64198 Harold W. Andersen Roger Guffey Joseph H. Williams John T. Boysen Denver 80217 A. L. Feldman Wayne W. Martin Oklahoma City 73125 James G. Harlow, Jr. William G. Evans Omaha 68102 Durward B. Varner Robert D. Hamilton DALLAS 75222 Irving A. Mathews Ernest T. Baughman Charles T. Beaird Robert H. Boykin El Paso 79999 Gage Holland Fredric W. Reed Houston 77001 Alvin I. Thomas J. Z. Rowe San Antonio 78295 Marshall Boykin, III Carl H. Moore SAN FRANCISCO ... .94120 Joseph F. Alibrandi John J. Balles Cornell C. Maier 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 74 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 THE PERFORMANCE OF BANK HOLDING COMPANIES. FUNCTIONS. 1974. 125pp. $1.00each; lOormore 1967. 29 pp. $.25 each; 10 or more to one address, to one address, $.75 each. $.20 each. BANK CREDIT-CARD AND CHECK-CREDIT PLANS. 1968. ANNUAL REPORT 102 pp. $1.00 each; 10 or more to one address, FEDERAL RESERVE BULLETIN. Monthly. $20.00 per $.85 each. year or $2.00 each in the United States, its posses- SURVEY OF FINANCIAL CHARACTERISTICS OF CONsions, Canada, and Mexico; 10 or more of same SUMERS. 1966. 166 pp. $1.00 each; 10 or more issue to one address, $18.00 per year or $1.75 to one address, $.85 each. each. Elsewhere, $24.00 per year or $2.50 each. SURVEY OF CHANGES IN FAMILY FINANCES. 1968. 321 BANKING AND MONETARY STATISTICS, 1914-1941. pp. $1.00 each; 10 or more to one address, $.85 (Reprint of Part 1 only) 1976. 682 pp. $5.00. each. BANKING AND MONETARY STATISTICS, 1941-1970. REPORT OF THE JOINT TREASURY-FEDERAL RESERVE 1976. 1,168 pp. $15.00. STUDY OF THE U.S. GOVERNMENT SECURITIES ANNUAL STATISTICAL DIGEST, 1970-75. 1976. 339 pp. MARKET. 1969. 48 pp. $.25 each; 10 or more to $4.00 per copy for each paid subscription to Fed- one address, $.20 each. eral Reserve Bulletin. All others, $5.00 each. JOINT TREASURY-FEDERAL RESERVE STUDY OF THE FEDERAL RESERVE MONTHLY CHART BOOK. Subscrip- GOVERNMENT SECURITIES MARKET: STAFF STUDtion includes one issue of Historical Chart Book. IES—PART 1. 1970. 86 pp. $.50 each; 10 or more $12.00 per year or $1.25 each in the United States, to one address, $.40 each. PART 2. 1971. 153 pp. its possessions, Canada, and Mexico; 10 or more and PART 3. 1973. 131 pp. Each volume $1.00; of same issue to one address, $1.00 each. Else- 10 or more to one address, $.85 each. where, $15.00 per year or $1.50 each. OPEN MARKET POLICIES AND OPERATING PROCE- HISTORICAL CHART BOOK. Issued annually in Sept. DURES—STAFF STUDIES. 1971. 218 pp. $2.00 Subscription to Monthly Chart Book includes one each; 10 or more to one address, $1.75 each. issue. $1.25 each in the United States, its posses- REAPPRAISAL OF THE FEDERAL RESERVE DISCOUNT sions, Canada, and Mexico; 10 or more to one MECHANISM. Vol. 1. 1971. 276 pp. Vol. 2. 1971. address, $1.00 each. Elsewhere, $1.50 each. 173 pp. Vol. 3. 1972. 220 pp. Each volume $3.00; CAPITAL MARKET DEVELOPMENTS. Weekly. $15.00 per 10 or more to one address, $2.50 each. year or $.40 each in the United States, its posses- THE ECONOMETRICS OF PRICE DETERMINATION CONsions, Canada, and Mexico; 10 or more of same FERENCE, October 30-31, 1970, Washington, D.C. issue to one address, $13.50 per year or $.35 each. 1972. 397 pp. Cloth ed. $5.00 each; 10 or more Elsewhere, $20.00 per year or $.50 each. to one address, $4.50 each. Paper ed. $4.00 each; SELECTED INTEREST AND EXCHANGE RATES—WEEKLY 10 or more to one address, $3.60 each. SERIES OF CHARTS. Weekly. $15.00 per year or FEDERAL RESERVE STAFF STUDY: WAYS TO MODERATE $.40 each in the United States, its possessions, FLUCTUATIONS IN HOUSING CONSTRUCTION. 1972. Canada, and Mexico; 10 or more of same issue 487 pp. $4.00 each; 10 or more to one address, to one address, $13.50 per year or $.35 each. $3.60 each. Elsewhere, $20.00 per year or $.50 each. LENDING FUNCTIONS OF THE FEDERAL RESERVE THE FEDERAL RESERVE ACT, as amended through De- BANKS. 1973. 271 pp. $3.50 each; 10 or more cember 1971, with an appendix containing provi- to one address, $3.00 each. sions of certain other statutes affecting the Federal INTRODUCTION TO FLOW OF FUNDS. 1975. 64 pp. $.50 Reserve System. 252 pp. $1.25. each; 10 or more to one address, $.40 each. REGULATIONS OF THE BOARD OF GOVERNORS OF THE IMPROVING THE MONETARY AGGREGATES (Report of the FEDERAL RESERVE SYSTEM Advisory Committee on Monetary Statistics). PUBLISHED INTERPRETATIONS OF THE BOARD OF GOV- 1976. 43 pp. $1.00 each; 10 or more to one ERNORS, as of June 30, 1976. $2.50. address, $.85 each. TRADING IN FEDERAL FUNDS. 1965. 116 pp. $1.00 ANNUAL PERCENTAGE RATE TABLES (Truth in Lendeach; 10 or more to one address, $.85 each. ing—Regulation Z) Vol. I (Regular Transactions). INDUSTRIAL PRODUCTION—1971 EDITION. 1972. 383 1969. 100 pp. Vol. II (Irregular Transactions). pp. $4.00 each; 10 or more to one address, $3.50 1969. 116 pp. Each volume $1.00, 10 or more each. of same volume to one address, $.85 each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Board Publications A 75 CONSUMER EDUCATION PAMPHLETS REVISION OF BANK CREDIT SERIES. 12/71. ASSETS AND LIABILITIES OF FOREIGN BRANCHES OF (Short pamphlets suitable for classroom use. Multiple U.S. BANKS. 2/72. copies available without charge.) BANK DEBITS, DEPOSITS, AND DEPOSIT TURNOVER— REVISED SERIES. 7/72. FAIR CREDIT BILLING YIELDS ON NEWLY ISSUED CORPORATE BONDS. 9/72. IF YOU BORROW TO BUY STOCK RECENT ACTIVITIES OF FOREIGN BRANCHES OF U.S. U.S. CURRENCY BANKS. 10/72. REVISION OF CONSUMER CREDIT STATISTICS. 10/72. WHAT TRUTH IN LENDING MEANS TO YOU ONE-BANK HOLDING COMPANIES BEFORE THE 1970 AMENDMENTS. 12/72. STAFF ECONOMIC STUDIES YIELDS ON RECENTLY OFFERED CORPORATE BONDS. Studies and papers on economic and financial subjects 5/73. that are of general interest in the field of economic CREDIT-CARD AND CHECK-CREDIT PLANS AT COMMERresearch. CIAL BANKS. 9/73. RATES ON CONSUMER INSTALMENT LOANS. 9/73. SUMMARIES ONLY PRINTED IN THE BULLETIN NEW SERIES FOR LARGE MANUFACTURING CORPORA- (Limited supply of mimeographed copies of full text TIONS. 10/73. available upon request for single copies.) U.S. ENERGY SUPPLIES AND USES, Staff Economic Study by Clayton Gehman. 12/73. THE GROWTH OF MULTIBANK HOLDING COMPANIES: INFLATION AND STAGNATION IN MAJOR FOREIGN IN- 1956-73, by Gregory E. Boczar. Apr. 1976. 27 DUSTRIAL COUNTRIES. 10/74. pp. THE STRUCTURE OF MARGIN CREDIT. 4/75. EXTENDING MERGER ANALYSIS BEYOND THE SINGLE- NEW STATISTICAL SERIES ON LOAN COMMITMENTS AT MARKET FRAMEWORK, by Stephen A. Rhoades. SELECTED LARGE COMMERCIAL BANKS. 4/75. May 1976. 25 pp. RECENT TRENDS IN FEDERAL BUDGET POLICY. 7/75. SEASONAL ADJUSTMENT OF MX—CURRENTLY PUB- RECENT DEVELOPMENTS IN INTERNATIONAL FINANCIAL LISHED AND ALTERNATIVE METHODS, by Edward MARKETS. 10/75. R. Fry. May 1976. 22 pp. MINNIE: A SMALL VERSION OF THE EFFECTS OF NOW ACCOUNTS ON COSTS AND EARNINGS MIT-PENN-SSRC ECONOMETRIC MODEL, Staff OF COMMERCIAL BANKS IN 1974-75, by John D. Economic Study by Douglas Battenberg, Jared J. Paulus. Sept. 1976. 49 pp. Enzler, and Arthur M. Havenner. 11/75. AN ASSESSMENT OF BANK HOLDING COMPANIES, Staff PRINTED IN FULL IN THE BULLETIN Economic Study by Robert J. Lawrence and Staff Economic Studies shown in list below. Samuel H. Talley. 1/76. INDUSTRIAL ELECTRIC POWER USE. 1/76. REPRINTS REVISION OF MONEY STOCK MEASURES. 2/76. (Except for Staff Papers, Staff Economic Studies, and SURVEY OF FINANCE COMPANIES, 1975. 3/76. some leading articles, most of the articles reprinted do CHANGING PATTERNS IN U.S. INTERNATIONAL TRANSnot exceed 12 pages.) ACTIONS. 4/76. REVISED SERIES FOR MEMBER BANK DEPOSITS AND SEASONAL FACTORS AFFECTING BANK RESERVES. 2/58. AGGREGATE RESERVES. 4/76. MEASURES OF MEMBER BANK RESERVES. 7/63. BANK HOLDING COMPANY FINANCIAL DEVELOPMENTS RESEARCH ON BANKING STRUCTURE AND PERFORM- IN 1975. 4/76. ANCE, Staff Economic Study by Tynan Smith. CHANGES IN BANK LENDING PRACTICES, 1975. 4/76. 4/66. INDUSTRIAL PRODUCTION—1976 Revision. 6/76. A REVISED INDEX OF MANUFACTURING CAPACITY, FEDERAL RESERVE OPERATIONS IN PAYMENT MECHA- Staff Economic Study by Frank de Leeuw with NISMS: A SUMMARY. 6/76. Frank E. Hopkins and Michael D. Sherman. 11/66. RECENT GROWTH IN ACTIVITIES OF U.S. OFFICES OF U.S. INTERNATIONAL TRANSACTIONS: TRENDS IN FOREIGN BANKS. 10/76. 1960-67. 4/68. NEW ESTIMATES OF CAPACITY UTILIZATION: MANU- MEASURES OF SECURITY CREDIT. 12/70. FACTURING AND MATERIALS. 11/76. REVISED MEASURES OF MANUFACTURING CAPACITY SURVEY OF TIME AND SAVINGS DEPOSITS, July 1976. UTILIZATION. 10/71. 12/76. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12-76 Federal Reserve Bulletin • January 1977 Index to Statistical Tables References are to pages A-3 through A-68 although the prefix "A" is omitted in this index ACCEPTANCES, bankers, 11, 25, 27 Demand deposits—Continued Agricultural loans of commercial banks, 18, 20-22 Ownership by individuals, partnerships, and corpora- Assets and liabilities (See also Foreigners): tions, 25 Banks, by classes, 16, 17, 18, 20-23, 29 Subject to reserve requirements, 15 Federal Reserve Banks, 12 Turnover, 13 Nonfinancial corporations, current, 38 Deposits (See also specific types of deposits): Automobiles: Banks, by classes, 3, 16, 17, 19, 20-23, 29 Consumer instalment credit, 42, 43 Federal Reserve Banks, 4, 12 Production, 48, 49 Subject to reserve requirements, 15 Discount rates at F.R. Banks (See Interest rates) BANK credit proxy, 15 Discounts and advances by F.R. Banks (See Loans) Bankers balances, 16, 18, 20, 21, 22 Dividends, corporate, 38 (,See also Foreigners) Banks for cooperatives, 35 EMPLOYMENT, 46, 47 Bonds (See also U.S. Govt, securities): Euro-dollars, 15, 27 New issues, 36, 37 Yields, 3 Branch banks: FARM mortgage loans, 41 Assets and liabilities of foreign branches of U.S. Farmers Home Administration, 41 banks, 62 Federal agency obligations, 4, 11, 12, 13 Liabilities of U.S. banks to their foreign Federal and Federally sponsored credit agencies, 35 branches, 23 Federal finance: Business activity, 46 Debt subject to statutory limitation and Business expenditures on new plant and equipment, 39 types and ownership of gross debt, 32 Business loans (See Commercial and industrial loans) Receipts and outlays, 30, 31 Treasury operating balance, 30 CAPACITY utilization, 46, 47 Federal Financing Bank, 35 Capital accounts: Federal funds, 3, 6, 18, 20, 21, 22, 27, 30 Banks, by classes, 16, 17, 19, 20 Federal home loan banks, 35 Federal Reserve Banks, 12 Federal Home Loan Mortgage Corp., 35, 40, 41 Central banks, 68 Federal Housing Administration, 35, 40, 41 Certificates of deposit, 23, 27 Federal intermediate credit banks, 35 Commercial and industrial loans: Federal land banks, 35, 41 Commercial banks, 15, 18, 23, 26 Federal National Mortgage Assn., 35, 40, 41 Weekly reporting banks, 20, 21, 22, 23, 24 Federal Reserve Banks: Commercial banks: Condition statement, 12 Assets and liabilities, 3, 15-18, 20-23 Discount rates (See Interest rates) Business loans, 26 U.S. Govt, securities held, 4, 12, 13, 32, 33 Commercial and industrial loans, 24 Federal Reserve credit, 4, 5, 12, 13 Consumer loans held, by type, 42, 43 Federal Reserve notes, 12 Loans sold outright, 23 Federally sponsored credit agencies, 35 Number, by classes, 16, 17 Finance companies: Real estate mortgages held, by type of holder and Loans, 20, 21, 22, 42, 43 property, 41 Paper, 25, 27 Commercial paper, 3, 24, 25, 27 Financial institutions, loans to, 18, 20, 21, 22, 23 Condition statements (See Assets and liabilities) Float, 4 Construction, 46, 50 Flow of funds, 44, 45 Consumer instalment credit, 42, 43 Foreign: Consumer prices, 46, 51 Currency operations, 12 Consumption expenditures, 52, 53 Deposits in U.S. banks, 4, 12, 19, 20, 21, 22 Corporations: Exchange rates, 68 Profits, taxes, and dividends, 38 Trade, 55 Security issues, 36, 37, 65 Foreigners: Cost of living (See Consumer prices) Claims on, 60, 61, 66, 67 Currency and coin, 5, 16, 18 Liabilities to, 23, 56-59, 64-67 Currency in circulation, 4, 14 Customer credit, stock market, 28 GOLD: Certificates, 12 DEBITS to deposit accounts, 13 Stock, 4, 55 Debt (See specific types of debt or securities) Government National Mortgage Assn., 35, 40, 41 Demand deposits: Gross national product, 52, 53 Adjusted, commercial banks, 13, 15, 19 Banks, by classes, 16, 17, 19, 20-23 HOUSING, new and existing units, 50 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All INCOME, personal and national, 46, 52, 53 REAL estate loans: Industrial production, 46, 48 Banks, by classes, 18, 20-23, 29, 41 Instalment loans, 42, 43 Life insurance companies, 29 Insurance companies, 29, 32, 33, 41 Mortgage terms, yields, and activity, 3, 40 Insured commercial banks, 17, 18 Type of holder and property mortgaged, 41 Interbank deposits, 16, 17, 20, 21, 22 Reserve position, basic, member banks, 6 Interest rates: Reserve requirements, member banks, 9 Bonds, 3 Reserves: Business loans of banks, 26 Commercial banks, 16, 17, 20, 21, 22 Federal Reserve Banks, 3, 8 Federal Reserve Banks, 12 Foreign countries, 68 Member banks, 3, 4, 5, 15, 16 Money and capital market rates, 3, 27 U.S. reserve assets, 55 Mortgages, 3, 40 Residential mortgage loans, 40 Prime rate, commercial banks, 26 Retail credit and retail sales, 42, 43, 46 Time and savings deposits, maximum rates, 10 International capital transactions of the SAVING: United States, 56-67 Flow of funds, 44, 45 International organizations, 56-61, 65-67 National income accounts, 53 Inventories, 52 Savings and loan assns., 3, 10, 29, 33, 41 Investment companies, issues and assets, 37 Savings deposits (See Time deposits) Investments (See also specific types of investments): Savings institutions, selected assets, 29 Banks, by classes, 16, 17, 18, 20, 21, 22, 29 Securities (See also U.S. Govt, securities): Commercial banks, 3, 15, 16, 17 Federal and Federally sponsored agencies, 35 Federal Reserve Banks, 12, 13 Foreign transactions, 65 Life insurance companies, 29 New issues, 36, 37 Savings and loan assns., 29 Prices, 28 Special Drawing Rights, 4, 12, 54, 55 LABOR force, 47 State and local govts.: Life insurance companies (See Insurance companies) Deposits, 19, 20, 21, 22 Loans (See also specific types of loans): Holdings of U.S. Govt, securities, 32, 33 Banks, by classes, 16, 17, 18, 20-23, 29 New security issues, 36 Commercial banks, 3, 15-18, 20-23, 24, 26 Ownership of securities of, 18, 20, 21, 22, 29 Federal Reserve Banks, 3, 4, 5, 8, 12, 13 Yields of securities, 3 Insurance companies, 29, 41 State member banks, 17 Insured or guaranteed by U.S., 40, 41 Stock market, 28 Savings and loan assns., 29 Stocks (See also Securities): New issues, 36, 37 MANUFACTURERS: Prices, 28 Capacity utilization, 46, 47 Production, 46, 49 TAX receipts, Federal, 31 Margin requirements, 28 Time deposits, 3, 10, 15, 16, 17, 19, 20, 21, 22, 23 Member banks: Trade, foreign, 55 Assets and liabilities, by classes, 16, 17, 18 Treasury currency, Treasury cash, 4 Borrowings at Federal Reserve Banks, 5, 12 Treasury deposits, 4, 12, 30 Number, by classes, 16, 17 Treasury operating balance, 30 Reserve position, basic, 6 Reserve requirements, 9 UNEMPLOYMENT, 47 Reserves and related items, 3, 4, 5, 15 U.S. balance of payments, 54 Mining production, 49 U.S. Govt, balances: Mobile home shipments, 50 Commercial bank holdings, 19, 20, 21, 22 Monetary aggregates, 3, 15 Member bank holdings, 15 Money and capital market rates (See Interest rates) Treasury deposits at Reserve Banks, 4, 12, 30 Money stock measures and components, 3, 14 U.S. Govt, securities: Mortgages (See Real estate loans) Bank holdings, 16, 17, 18, 20, 21, 22, 29, 32, 33 Mutual funds (See Investment companies) Dealer transactions, positions, and financing, 34 Mutual savings banks, 3, 10, 20-22, 29, 32, 33, 41 Federal Reserve Bank holdings, 4, 12, 13, 32, 33 Foreign and international holdings and NATIONAL banks, 17 transactions, 12, 32, 64 National defense outlays, 31 Open market transactions, 11 National income, 52 Outstanding, by type of security, 32, 33 Nonmember banks, 17, 18 Ownership, 32, 33 Rates in money and capital markets, 27 OPEN market transactions, 11 Yields, 3 Utilities, production, 49 PERSONAL income, 53 Prices: VETERANS Administration, 40, 41 Consumer and wholesale, 46, 51 Stock market, 28 WEEKLY reporting banks, 20-24 Prime rate, commercial banks, 26 Wholesale prices, 46 Production, 46, 48 Profits, corporate, 38 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A78 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories Minneapolis^, C hicago J OmafiA* KansasCitifl Oklahoma Cittf W tU Dallas JSSJM^ Antomio* January 1977 ALAS KA LEGEND — Boundaries of Federal Reserve Districts ® Federal Reserve Bank Cities Boundaries of Federal Reserve Branch • Federal Reserve Branch Cities Territories Federal Reserve Bank Facility Q Board of Governors of the Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A79 Guide to Tabular Presentation and Statistical Releases SYMBOLS AND ABBREVIATIONS p Preliminary SMSA Standard metropolitan statistical area r Revised REITS Real estate investment trusts rp Revised preliminary * Amounts insignificant in terms of the partice Estimated ular unit (e.g., less than 500,000 when c Corrected the unit is millions) n.e.c. Not elsewhere classified (1) Zero, (2) no figure to be expected, (3) Rp's Repurchase agreements figure delayed or, (4) no change (when IPC Individuals, partnerships, and corporations figures are expressed in percentages). GENERAL INFORMATION Minus signs are used to indicate (1) a decrease, (2) obligations of the Treasury. "State and local govt." a negative figure, or (3) an outflow. also includes municipalities, special districts, and other "U.S. Govt, securities" may include guaranteed political subdivisions. issues of U.S. Govt, agencies (the flow of funds figures In some of the tables details do not add to totals also include not fully guaranteed issues) as well as direct because of rounding. LIST PUBLISHED SEMIANNUALLY, WITH LATEST BULLETIN REFERENCE Issue Page Anticipated schedule of release dates for individual releases Dec. 1976 A-82 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis