Federal Reserve Bulletin, 1977-05

M AY 1977 FEDERAL RESERVE BULLETIN Domestic Financial Developments in the First Quarter of 1977 Survey of Terms of Bank Lending—New Series Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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

NUM BER 5 □ VOLUM E 63 □ M AY 1977 FEDERAL RESERVE BULLETIN Board of Governors of the Federal Reserve System Washington, D.C. PUBLICATIONS COMMITTEE Stephen H. Axilrod □ Joseph R. Coyne □ John M. Denkler □ Janet O. Hart John D. Hawke, Jr. □ James L. Kichline □ John E. Reynolds Richard H. Puckett, 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

Table of Contents 433 Domestic Financial Developments Statements to Congress in the First Quarter of 1977 463 Chairman Burns presents the quarterly Quarterly report to the Joint Eco­ report of the Board of Governors on the nomic Committee of the U.S. Congress condition of the national economy and highlighting important developments in the course of monetary policy to the domestic financial markets during the Committee on Banking, Housing and fall and early winter. Urban Affairs, U.S. Senate, May 3, 1977. 440 Staff Economic Studies 468 David M. Lilly, Member of the Board of Governors, expresses the support of Summary of “Recent Trends in Local the Board for H.R. 2387 before the Banking Market Structure” points out Subcommittee on Employee Ethics and that most of the 213 standard metro­ Utilization of the Committee on Post politan statistical area banking markets Office and Civil Service, U.S. House of and 233 county banking markets in the Representatives, May 4, 1977. study acquired a more competitive structure between 1966 and 1975. 473 Record of Policy Actions of the 442 Survey of Terms of Bank Lending Federal Open Market Committee Introduction of new survey of terms In the meeting held on March 15, of bank lending including data for Feb­ 1977, the Committee decided that tar­ ruary 7- 12, 1977. gets for growth in M-l and M-2 over the March-April period at annual rates within ranges of 4l/i to 8V2 per cent and 456 The Need for Order in Interna­ 7 to 11 per cent, respectively, would be tional Finance appropriate. The Committee also In an address to the Columbia Uni­ amended paragraph 1(b) of the authori­ versity School of Business, Arthur F. zation for domestic open market opera­ Burns, Chairman of the Board of Gov­ tions relating to outright purchases and ernors, details the actions to be taken sales of bankers acceptances and re­ or avoided in order to achieve a new viewed its continuing authorizations and sense of order in the working of inter­ directives. national financial mechanisms. He out­ lines nine responsibilities of the major participants in the international financial 487 Law Department system, including the International Monetary Fund, national governments, Various amendments, interpretations, bankers, and bank examiners. and orders. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

521 Announcements 523 Industrial Production Amendment to Regulation T that af­ Output increased by an estimated 0.8 per fects the trading of stock market options. cent in April. (See Law Department for details.) Interpretations of Regulation B deter­ mining that certain provisions of the California civil code are not inconsistent with the Equal Credit Opportunity Act. Al Financial and Business Statistics (See Law Department for details.) A3 Domestic Financial Statistics Continuance of exemption of most A46 Domestic Nonfinancial Statistics New York State lenders from mortgage A54 International Statistics disclosures under Regulation C. A69 Guide to Tabular Presentation Deferral of Board action on Regula­ and Statistical Releases tion Y to permit a bank holding com­ pany to engage in providing manage­ A72 Board of Governors and Staff ment consulting advice to nonaffiliated savings banks. (See Law Department for A74 Open M arket Committee and details.) Staff; Federal Advisory Council Proposed amendments to Regulation T affecting the trading of stock options, A75 Federal Reserve Banks and and Regulation Z eliminating unneces­ Branches sary information from the Truth in Lending disclosure statement. A76 Federal Reserve Board Publications Revisions in data and nomenclature of call report figures. A78 Index to Statistical Tables Two new Equal Credit Opportunity pamphlets. A80 Map of Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments in the First Quarter of 1977 This report, which was sent to the Joint Eco­ and local governments undertook a record vol­ nomic Committee of the U.S. Congress, high­ ume of long-term bond financing, a sizable lights the important developments in domestic portion of which was used to refund in advance financial markets during the winter and early outstanding high-coupon obligations. spring. Most short- and long-term market interest rates moved higher over the first quarter, re­ Private sector credit demands in U.S. financial versing the large decline that had been recorded markets rose during the first quarter of 1977, between mid-November and early January. Al­ as aggregate spending in the economy acceler­ though Federal funds—overnight loans of im­ ated despite the severe winter conditions during mediately available bank funds—continued to part of the period. Household demands for trade narrowly in a range of 4% to 43A per cent mortgage and consumer credit expanded through year-end and beyond, many market strongly, and total funds raised by nonfinancial participants apparently had been expecting a corporations increased although there was some further easing in money market conditions. In­ decline in the volume of bond and equity fi­ dications of renewed strength in the economy nancing. In the public sector, credit demands and the prospect of a substantial enlargement remained at a high level as the Treasury raised in the Federal deficit as a result of the new funds in the credit markets to finance the con­ administration’s proposed fiscal policy program, tinuing large Federal deficit. In addition, State however, caused interest rates to begin increas- Interest rates Per cent NOTES: Monthly averages except for F.R. discount rate and conven­ tional mortgages (based on quota­ tions for one day each month). Yields: U.S. Treasury bills, market yields on 3-month issues; prime commercial paper, dealer offering rates; conventional mortgages, rates on first mortgages in primary markets, unweighted and rounded to nearest 5 basis points, from Dept, of Housing and Urban De­ velopment; Aaa utility bonds, weighted averages of new publicly offered bonds rated Aaa, Aa, and A by Moody’s Investors Service and adjusted to Aaa basis; U.S. Govt, bonds, market yields ad­ justed to 20-year constant maturity by U.S. Treasury; State and local govt, bonds (20 issues, mixed quality), Bond Buyer. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

434 Federal Reserve Bulletin □ May 1977 ing in January. By early February, Treasury bill cent. The slower growth of interest-earning de­ yields had moved up 25 to 40 basis points, and posits reflected lower offering rates on some coupon yields had risen 20 to 60 basis points, categories of savings and longer-term time de­ with intermediate-term issues recording the posits, higher short-term market rates of inter­ largest increases. After these adjustments, in­ est, and the expansion in consumption expendi­ terest rates in general showed little further tures during the first quarter. variation over the remainder of the quarter. Growth in M-l accelerated sharply in April. Although market interest rates generally rose With the accompanying increased demand for during the first quarter, the Federal funds rate bank reserves, the Federal funds rate rose in changed very little as growth in the monetary the latter part of April and early May, and aggregates was well within target ranges member banks increased their borrowing from adopted by the Federal Open Market Committee Federal Reserve Banks. Over all, market inter­ at its monthly meetings. The narrowly defined est rates also increased in this period, as private money stock (M-l) increased at a 4% per cent credit demands, particularly in the short-term annual rate in the first quarter, down from 63A area, remained generally strong. per cent in the previous quarter and 5% per cent for the year 1976. Inflows of time and savings deposits also moderated in the first quarter, MONETARY AGGREGATES contributing to reductions in the rates of expan­ AND BANK RESERVES sion of the broader measures of the money stock. M-2 growth was about 9Vz per cent in The slowing in M-1 growth in the first quarter the first quarter as compared with 12^ per cent relative to its pace in the previous quarter en­ in the previous quarter, and the rate of increase tirely reflected a reduction in the rate of growth of M-3 slowed to 11 per cent from \4Va per of demand deposits, as the rate of increase of Changes in selected monetary aggregates Per cent, seasonally adjusted annual rates 1976 1977 Item 1975 1976 HI Q3 Q4 Ql NOTES: Me T m o b ta e l r b .. a .. n .. k . .. r . e .. s . e .. r .. v . e .. s . : . -.2 1.0 - 1.5 2.7 4.4 2.7 1 M-1 is currency plus private Nonborrowed ........ 3.2 1.2 - 1.3 2.6 4.8 2.6 demand deposits adjusted. M-2 is M-1 plus bank time and Concepts of money:' savings deposits adjusted other M-l ....................... 4.4 5.7 5.6 4.4 6.8 4.8 than large CD’s. M-2 ....................... 8.3 10.8 10.8 9.1 12.2 9.4 M-3 is M-2 plus deposits at M-3 ....................... 11.1 12.7 13.0 11.4 14.2 11.0 mutual savings banks and savings M M - -5 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 9 . . 5 7 1 7 0 . . 0 2 6 8 . . 0 9 6 9 . .3 0 1 9 2 . . 6 5 1 8 0 . . 4 0 and loan associations and credit union shares. Time and savings de­ M-4 is M-2 plus large negotia­ posits at commer­ ble CD’s. cial banks: M-5 is M-3 plus large negotiable Total (excluding CD’s. large CD’s)__ 11.7 15.0 14.1 12.8 16.3 12.7 2Savings and loan associations, Savings ................. 17.0 24.5 25.8 13.4 26.9 20.5 Other time ............ 8.0 7.6 5.3 12.0 7.3 6.1 mutual savings banks, and credit unions. Thrift institutions2 ... 15.8 15.8 14.1 14.8 17.2 13.4 •’Total member bank deposits plus funds provided by Euro-dollar Bank credit proxy'* — 4.3 4.3 2.4 3.9 8.2 5.3 borrowings and bank-related com­ Memo (change in bil­ mercial paper. lions of dollars, seasonally ad­ justed) Note.—Changes are calculated Large CD’s .............. - 5.3 - 19.2 - 11.8 - 4.3 - 3.1 .3 from the average amounts out­ U.S. Govt, demand standing in each quarter. Annual deposits at all rates of change in reserve measures member banks -.2 .3 -.4 .6 .1 -.8 have been adjusted for changes in reserve requirements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Ql 1977 435 currency remained unchanged. This moderation the attractiveness of interest-bearing bank and in M-1 growth during the first 3 months of 1977 thrift deposits. Also serving to moderate the rate occurred despite a pick-up in the pace of ex­ of growth of time and savings deposit flows in pansion in gross national product, and M-1 the first quarter may have been the sharp rise velocity—GNP divided by M-1—grew at a 6 in consumption, as household spending on fuel per cent annual rate, a marked increase over and durable goods increased rapidly during the the previous quarter and the largest quarterly quarter. The growth of M-2 in the first quar­ advance in a year. ter—9Vi per cent at an annual rate—was below Inflows of time and savings deposits to banks that of the fourth quarter and also below the and thrift institutions slowed in the first 3 first-quarter rate of growth of GNP; conse­ months of 1977, following rapid growth in the quently, M-2 velocity increased modestly after fourth quarter of 1976. During the fourth quar­ declining in each of the three previous quarters. ter, market rates of interest fell to levels below Despite reductions in the growth of commer­ regulatory ceilings and late in the year some cial bank deposits included in the monetary depositary institutions moved to lower their cost aggregates, such flows continued to be large of funds and to slow their very large time and enough to support the bulk of the expansion of savings deposit inflows by reducing promotional bank credit. In addition, some of the growth activity, by withdrawing some categories of in bank loans and investments during the first deposits from their offering schedules, and by quarter was financed by an increase in bank lowering offering rates on other categories of borrowing from nonbank sources through Fed­ deposits. These actions, along with the firming eral funds and security repurchase transactions, of market rates of interest early in 1977, partic­ while the amount of large negotiable certificates ularly on intermediate-term securities, reduced of deposit (CD’s) outstanding remained essen­ tially unchanged. Changes in income velocity of M-1 and M-2 The first-quarter expansion in reserves avail­ able to member banks—23A per cent at an an­ Percentage rate of change nual rate—was slower than that of the monetary aggregates. Accounting for some of the dif­ ference between growth in reserves and in the monetary aggregates were relatively large in­ creases estimated for nonmember bank deposits and currency, which require no direct provision of reserves. In addition, a decline in U.S. Gov­ ernment and interbank demand deposits released reserves to support deposits included in money supply measures. BANK CREDIT AND COMMERCIAL PAPER During the first 3 months of 1977 bank loans and investments expanded $22% billion or at an IIV2 per cent annual rate, the sharpest in­ crease in 2V2 years. Bank acquisitions of Treas­ ury securities continued to be large—the $5.8 billion increase exceeded the average quarterly growth during 1976—while other securities in bank portfolios (principally tax exempt and U.S. Data are at seasonally adjusted annual rates of growth. Money stock data are quarterly averages. Government agency securities) declined for the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

436 Federal Reserve Bulletin □ May 1977 first time in a year. Total bank loans in the Business loans and short-term business credit January-March period expanded at an annual Seasonally adjusted changes at annual percentage rates rate of 13 per cent, well above the 13A per cent rate of growth in the fourth quarter and the 6 Business loans Column 2 plus per cent rate for all of 1976. Household credit Period Excluding nonfinancial demands accounted for an important part of Total1 bank holdings company bank credit expansion as consumer loans con­ a o c f c e b p a t n a k n e c r e s s com pa m p e er r 2 cial tinued to grow at their relatively brisk pace of the second half of 1976 and real estate loans (1) (2) (3) 1975—Ql .... - 5.1 - 6.8 - 5.0 increased more rapidly than in any quarter of Q2 ... - 8.7 - 9.0 - 11.2 1976. Bank lending to nonbank financial insti­ Q Q4 3 - 3. . 1 7 - - 3 3 . . 5 3 - - 4 6. . 5 0 tutions also increased during the first quarter, 1976—Ql .... - 6.7 - 4.8 - 2.9 for the first time in a year. Q2 .... 1.4 2.2 6.4 Business loans expanded at nearly a 10 per Q Q4 3 . . . . . . . . 4 9 . .7 6 5 1 . . 9 8 - 7 1 . .1 4 cent annual rate for the second consecutive 1977—Q1 .... 9.9 14.9 14.9 quarter, after generally declining earlier in the business expansion. The growth of business *At all commercial banks based on last-Wednesday-ofloans over the last two quarters, however, has month data, adjusted for outstanding amounts of loans sold to affiliates. been distorted by changes in bank holdings of 2 Short-term business credit is business loans excluding bank bankers acceptances, which are included in the holdings of bankers acceptances plus nonfinancial company commercial paper measured from end of month to end of business loan category. Some banks acquired month. sizable amounts of acceptances during the fourth quarter for tax purposes (in order to expand their When an adjustment is made to exclude bank asset bases used to calculate tax-deductible loan holdings of bankers acceptances, business loan loss reserves) and subsequently reduced their growth picked up substantially in the first quar­ acceptance holdings during the first quarter to ter from the final quarter of 1976. levels near those of the preceding September. Similarly, the pace of short-term business credit expansion—business loans at banks ad­ Components of Major categories of justed for bank holdings of bankers acceptances bank credit bank loans plus commercial paper—advanced strongly in Change, billions of dollars the first quarter. Two factors appear to be con­ TREASURY SECURITIES BUSINESS tributing to the recent expansion of short-term ni_5 business credit. First, balance-sheet restruc­ ! ; J=L tt turing by businesses, which was an important n factor underlying the weakness in short-term credit demands during 1975 and during most OTHER SECURITIES REAL ESTATE of 1976, has abated in recent months. Second, the external financing needs of businesses ap­ u n n n | 5 n n n n . f l I parently increased in the first quarter as capital expenditures expanded relative to internally CONSUMER TOTAL LOANS generated funds. 16 n , n » 12 , NONBANK FINANCIAL 8 NONBANK INTERMEDIARIES n 4 ^ u —. AND THE MORTGAGE MARKET I 0 ■ h h Ql Q2 Q3 Q4 Ql Ql Q2 Q3 Q4 Ql The net increase in total mortgage debt out­ 1976 ’77 1976 77 standing in the first quarter of 1977 is estimated Seasonally adjusted. Total loans and business loans adjusted to have been about the same as the exceptionally for transfer between banks and their holding companies, affiliates, subsidiaries, or foreign branches. large rise of the previous quarter. The residential Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Ql 1977 437 component again dominated total mortgage Deposits lending; it has accounted for more than three- Savings and loans and mutual savings banks fourths of the net increase in total mortgage debt Annual rate of change, per cent since the final quarter of 1974. The deposits of savings and loan associations 16 and mutual savings banks combined grew at a 13.3 per cent annual rate in the first 3 months of 1977. This was appreciably less than in other recent quarters, although still high by historical standards. Despite a slowing of inflows, savings and loan associations—the principal suppliers of Ql Q2 Q3 Q4 Ql residential mortgage credit—continued to ac­ __________1976__________77 quire large amounts of mortgages in the first Seasonally adjusted. Quarterly averages at annual rates. quarter, but at somewhat less than the record pace of the final quarter of 1976. Mortgage ings banks and life insurance companies, re­ commitments outstanding, including loans in mained relatively weak. Commercial and multi­ process, at savings and loan associations family mortgage lending, the sectors in which reached a record level of $26.3 billion at the life insurance companies traditionally focus end of March, and liquid assets held by these their activity, remained at low levels although institutions remained large. outstanding commitments have risen substan­ Although net acquisitions of mortgages by tially from their depressed total 1 year earlier. savings and loan associations moderated some­ In a lagged response to yield movements in what in the first quarter of 1977, the estimated other long-term markets, average interest rates net increase in mortgage loans at commercial on new commitments for home mortgages in banks was the highest in almost 3 years. On the primary market moved about 15 basis points the other hand, direct mortgage investment by lower during January and February, and then other diversified lenders, including mutual sav- backed up slightly in March. However, yields on Government-underwritten mortgages in the secondary markets, which move more closely with bond yields, increased by 35 to 50 basis Net change in mortgage debt outstanding points over the quarter. Billions of dollars, seasonally adjusted annual rates 1976 1977 Change— Ql Q2 Q3 Q4 eQl SECURITIES MARKETS Gross long-term debt and equity financing by By type of debt: Total .................................... 79 74 92 98 97 U.S. corporations totaled $49 billion, at a sea­ Residential .......................... 61 56 69 74 73 Other1 ................................. 18 18 23 24 24 sonally adjusted annual rate, in the first quarter of 1977—the smallest quarterly total since the By type of holder: Commercial banks .............. 13 13 14 14 16 third quarter of 1975. In the bond market, Savings and loans .............. 37 43 47 52 48 Mutual savings banks ........ 3 4 4 5 4 private placements of corporate bonds are esti­ L FN ife M i A ns - u G r N an M ce A c o . m ... p .. a .. n .. i . e .. s . .... . . . 4 4 - < 6 *) -1 2 -5 3 -1 2 mated to have continued at a near-record pace, Other2 ................................. 18 20 26 29 28 but public bond offerings were at their lowest level in more than 2 years despite a large volume includes commercial and other nonresidential as well as of bond refunding operations by telephone farm properties. 2 Includes net changes in mortgage-backed securities companies. guaranteed by the Government National Mortgage Association, Industrial corporations, particularly higher­ Federal Home Loan Mortgage Corporation, or Farmers Home Administration, some of which may have been purchased by rated concerns, publicly offered only a moderate the institutions shown separately. amount of new long-term debt securities during eEstimated. *Less than $500 million. the first quarter. Many of these companies Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

438 Federal Reserve Bulletin □ May 1977 Gross offerings of new security issues Reserve index of new Aaa-rated utility bond Billions of dollars, seasonally adjusted annual rates yields climbed 40 basis points between early January and early March, but then retraced part 1976 1977 of this increase in late March and ended the Type of issue quarter at 8.26 per cent. Ql Q2 Q3 Q4 eQl Stock prices as measured by major indexes closed 1976 at or near their highest levels of Corporate securities—total --- 53 52 56 53 49 the year. However, indications of a quickening Bonds .................................. 39 41 47 43 40 Publicly offered .............. 27 27 26 26 24 in the rate of inflation, the expected impact of Privately placed .............. 12 14 21 17 16 the severe winter weather on profits, and uncer­ Stocks ................................. 14 11 9 10 9 tainty about the administration’s still-to-be an­ Foreign securities ................... 12 10 10 9 5 nounced energy and anti-inflation proposals State and local govt, bonds .. 34 36 36 36 42 contributed to the general decline in equity prices over the first quarter. New stock offerings eEsti mated. contracted somewhat during the quarter, due in large part to the over-all decline in share prices. probably have completed the extensive balance- In the municipal securities market, State and sheet restructuring that had been begun in late local governments sold a record volume of 1974, so their immediate need for long-term long-term bond issues in the first quarter. The external financing appears to have been reduced. increase in offerings was due mostly to advance Finance companies and other financial concerns, refundings of outstanding high coupon issues. however, continued to raise a large volume of Unlike taxable bond yields, however, the over­ longer-term debt capital. The large volume of all level of tax-exempt interest rates remained new debt offered by finance companies reflects relatively unchanged over the quarter, although both their continuing efforts to restructure and risk premiums narrowed substantially. Much of the recent strong growth in auto sales and con­ the increased volume of long-term municipal sumer credit. bonds reportedly was absorbed by prop­ Public utilities accounted for about one-third erty/casualty insurance companies, open-end of total public bond offerings in the first 3 and unit trust investment companies, and months of 1977, as telephone company smaller commercial banks. The Bond Buyer issues—mostly Bell System subsidiaries—were index of tax-exempt yields closed the first quar­ offered in near-record amounts. The unusually ter at 5.85 per cent, little changed from the level large volume of telephone company obligations of 5.83 per cent at year-end 1976. is attributable in part to bond refunding opera­ The Treasury sold $14 billion of marketable tions by a number of companies. Without these securities in the first quarter, substantially below refundings, seasonally adjusted public bond of­ its January estimate of $20 billion to $23 billion. ferings in the first quarter of 1977 would have The reduced pace of marketable security is­ been at their lowest level in 3 years. suance—almost all in coupon obligations—was A smaller volume of foreign bonds was of­ due to several factors: (1) the combined Treas­ fered on domestic capital markets in early 1977. ury deficit was smaller than expected, primarily This decline is attributable in large part to the because of a sizable shortfall in Federal outlays; reduced pace of new public and private bond (2) the Treasury issued an unexpectedly large issues by Canadian provinces and corporations. amount, $3.7 billion, of nonmarketable Several sizable private placements of bonds for issues—$2.2 billion of which was sold to State Canadian provinces swelled foreign offerings in and local governments engaged in advance re­ 1976, but offerings by these issuers were much funding operations; and (3) the Treasury re­ more modest in the first quarter. duced its cash balance between year-end 1976 Corporate bond yields declined to their lowest and the end of March by almost $3 billion. levels in 3 years in early January, but then rose Although households are estimated to have sharply over the next few weeks. The Federal liquidated a modest amount of marketable Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Ql 1977 439 Federal Government borrowing and cash balance Quarterly totals, in billions of dollars, not seasonally adjusted 1975 1976 1977 Item Q4 Ql Q2 Q3 Q4 eQl Treasury financing: Budget surplus, or deficit --- - 26.8 - 22.8 2.0 - 13.0 - 22.8 - 18.7 Off-budget deficit' ................. - 2.3 - 3.7 -.6 - 1.8 .4 -4.3 Net cash borrowings, or repayments (—) ................. 25.9 24.1 9.4 18.0 17.4 17.6 Other means of financing^ .. 1.2 2.0 - 4.0 -.7 -.8 2.7 Change in cash balance ........ - 2.1 -.4 6.8 2.6 - 5.7 - 2.6 Federally sponsored credit agen­ cies, net cash borrowings'* 1.8 .3 .5 1.7 .4 1.0 'Includes outlays of the Pension Benefit Guaranty Corporation, Postal Service Fund, Rural Electrification and Telephone Revolving Fund, Rural Telephone Bank, Housing for the Elderly or Handicapped Fund, and Federal Financing Bank. All data have been adjusted to reflect the return of the Export-import Bank to the unified budget. “Checks issued less checks paid, accrued items, and other transactions. 3Includes debt of the Federal Home Loan Mortgage Corporation, Federal home loan banks, Federal land banks, Federal intermediate credit banks, banks for cooperatives, and Federal National Mortgage Association (including discount notes and securities guaranteed by the Government National Mortgage Association). Treasury securities in the first quarter, purchases during the quarter. The technical position of by commercial banks, foreigners, State and U.S. Government securities dealers strength­ local governments (almost half of which were ened over the quarter. Dealer inventories of for advance refundings), and business corpora­ Treasury bills were less than $3.5 billion at the tions were relatively large. In addition, the end of March—about $6 billion below their Federal Reserve System purchased outright al­ mid-December level—and coupon positions most $1.2 billion of Treasury bills and $1.7 also were quite modest. Total dealer holdings billion of Treasury coupon issues in the course of Treasury securities at the end of the first of providing reserves to the banking system quarter were at their lowest level in 2 years. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

440 Staff Economic Studies The research staffs of the Board of Governors In all cases the analyses and conclusions set of the Federal Reserve System and of the Fed­ forth are those of the authors and do not neces­ eral Reserve Banks undertake studies that cover sarily indicate concurrence by the Board of a wide range of economic and financial sub­ Governors, by the Federal Reserve Banks, or jects, and other staff members prepare papers by the members of their staffs. related to such subjects. In some instances the Single copies of the full text of each of the Federal Reserve System finances similar studies studies or papers summarized in the B ulletin by members of the academic profession. are available in mimeographed form. The list From time to time the results of studies that of Federal Reserve Board publications at the are of general interest to the economics profes­ back of each B ulletin includes a separate sion and to others are summarized—or they may section entitled “Staff Economic Studies99 that be printed in full—in this section of the Federal enumerates the studies for which copies are Reserve B ulletin. currently available in that form. STUDY SUMMARY RECENT TRENDS IN LOCAL BANKING MARKET STRUCTURE Samuel H. Talley—Staff, Board of Governors Prepared as a staff paper in early 1977 For a number of years trends in banking market of banking organizations in the market; (2) the structure have attracted wide interest on the part three-firm concentration ratio; and (3) the Her­ of many varied groups—the Congress, the bank findahl Index. regulators, and the general public. This interest The results of the study indicate that most stems from the belief that the structure of bank­ SMSA and county banking markets acquired a ing markets has an important effect on the more competitive structure between 1966 and competitive conduct of banks and on the quan­ 1975, irrespective of which measure of market tity and quality of banking services received by structure was used. Moreover, these pro-com­ the public and the prices paid for those services. petitive changes tended to be quite sizable for The purpose of this study was to identify recent a 9-year period. The study made no attempt to trends in the structure of 213 standard metro­ determine whether these pro-competitive struc­ politan statistical area (SMSA) banking markets tural changes have resulted in the provision of and 233 county banking markets over the better banking services at more favorable prices 1966-75 period. Trends in market structure to the public. However, since recent empirical were measured by changes in (1) the number studies have indicated that a more competitive Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Staff Economic Studies 441 banking structure does produce better services ing market structure according to the branching at lower prices, it is reasonable to assume that laws of the States in which the markets were such desirable results have occurred. located. In all three branching classifications— This study also found that pro-competitive unit banking, limited branching, and statewide changes in banking market concentration oc­ branching—it was found that most markets ex­ curred with greatest frequency and in largest perienced pro-competitive structural changes magnitude in those SMSA and county banking between 1966 and 1975. The most frequent and markets that had a relatively high concentration largest pro-competitive structural changes oc­ ratio in 1966. curred in markets located in States with unit Finally, the study examined changes in bank­ banking or with statewide branching. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

442 Survey of Terms of Bank Lending New Series Since as early as 1919 the Federal Reserve has could not be addressed within the design of the been monitoring interest rates on loans at com­ old survey. This latter shortcoming prompted mercial banks through survey methods. Over the the Federal Reserve to initiate the monthly Sur­ years, the interest rate surveys have been ex­ vey of Selected Interest Rates in 1972 under panded and refined to reflect the growth and the auspices of the then-Committee on Interest development of the banking industry. The Fed­ and Dividends. eral Reserve’s principal interest rate survey of The Survey of Selected Interest Rates asked recent years, the Quarterly Interest Rate Survey approximately 350 responding banks to provide (QIRS), has been revised to enlarge its coverage the “most common” interest rates charged on and scope. The new survey, now called the small ($10,000 to $25,000) business loans and Survey of Terms of Bank Lending (STBL), was selected types of agricultural and consumer first taken in February 1977. loans. The accuracy of this survey, however, was not comparable to that of the QIRS since data on lending rates on actual loans were not OBJECTIVES OF collected and the survey results could not be weighted by the volume of lending by respond­ THE REDESIGNED SURVEY ents. The content and coverage of the STBL were The new STBL replaces the Quarterly Interest designed to achieve certain objectives related to Rate Survey and the small business and agricul­ changing practices in banking and to provide tural portions of the Survey of Selected Interest better, more representative statistics on bank Rates.1 The STBL will gather information on lending. The previous survey had been limited actual loans made to businesses and farmers to collecting interest rate information on busi­ during the survey period. Construction loans ness loans made at 120 large commercial banks. secured by real estate, which are not included The reporting panel was not representative of in the business loan category because of their all commercial banks; it consisted of the largest collateral, were added to the survey. banks, which accounted for slightly over 60 per Another objective in the redesign of the sur­ cent of all business loans of commercial banks. vey was to add information on nonprice terms While the banking sector has become more of lending that might help explain movements closely integrated in recent years through ad­ and levels of interest rates charged on loans. vances in communications and methods of The interest cost is the explicit cost of bank transferring funds, the validity of a survey lim­ credit, but nonprice terms of lending—or price ited only to large banks came into question, as terms not directly associated with the loan such a large share of business lending was made at as commitment fees—also might justifiably be other banks. Moreover, issues affecting the en­ included in the total cost of borrowing. Eco­ tire banking system such as the cost or avail­ nomic theory and empirical analysis of bank ability of funds to small business borrowers xThe consumer loan section of the Survey of Se­ lected Interest Rates will be continued in the same Note.—This article was prepared by Paul W. Boltz form, and the results will continue to be published of the Board’s Division of Research and Statistics. monthly in the modified G.10 release. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Survey of Terms of Bank Lending 443 lending terms suggested the importance of terly Interest Rate Survey, the maturity of compensating balances, collateral, loan insur­ short-term business loans had to be assumed, ance, and commitment fees. However, in con­ and the results of the Survey of Selected Interest sidering the addition of such nonprice terms of Rates reflected no adjustment for maturity on lending to the interest rate survey, the avail­ loans to small businesses. In addition, the new ability of this information in bank records and survey asks respondents to report on whether the cost to respondents of reporting nonprice rates on loans are floating, that is, the interest items acted as constraints. rate charged is tied to a rate that may change A pretest of the survey was conducted in early over the life of the loan. Under floating rate 1976 to determine the feasibility of collecting agreements, interest rates typically are linked nonprice terms of business and agricultural to the prime lending rate of the bank. loans from banks of all sizes on a regular basis. It was found that amounts of compensating balances and commitment fees associated with DESCRIPTION OF individual loans presented the most difficulty to THE NEW SURVEY respondents, particularly large banks that have computerized data systems. Many respondents The STBL will be conducted during the first indicated that isolating compensating balances full business week of the middle month of each and commitments fees associated with a partic­ quarter at about 340 member and nonmember ular takedown could not be accomplished with banks, randomly selected to represent all size their existing data systems. Still other institu­ strata of insured commercial banks in the United tions reported that they monitored the level of States.3 About 100 of the respondents are non­ transactions balances maintained by borrowers member banks; their reports are collected and and could not identify idle balances usually processed by the Federal Deposit Insurance associated with the concept of compensating Corporation. Small- and intermediate-sized balances. banks report on business, construction, and ag­ The inability of some banks to report on ricultural loans made during the 5 days of the compensating balances and commitment fees survey week. Very large commercial banks re­ was not inconsistent with results from occa­ port on their loans made over two or three sional special surveys of bank lending that have randomly selected days of the survey week in been conducted by the Federal Reserve. Never­ order to reduce the absolute burden of partici­ theless, in the large majority of banks some pation in the survey to respondents and the nonprice terms of lending met the two criteria editing and processing costs to the Federal Re­ of availability and economic importance. These serve. A monthly supplement to the quarterly include information as to whether there was any survey is conducted during the first full business commitment or commitment fee, whether there week of the first and last month of the quarter. was Federal loan insurance or collateral, and The supplement is conducted at member banks for agricultural loans whether other lending in­ only and is limited to price terms on business stitutions participated in the loans.2 loans (excluding construction loans secured by Both the Quarterly Interest Rate Survey and real estate). the Survey of Selected Interest Rates were sub­ The three sets of forms and instructions used ject to a number of technical shortcomings that in the quarterly survey and monthly supplement the new survey was designed to correct. The are reproduced at the end of this article.4 The principal improvement in this area is the collec­ first form is used quarterly to collect data on tion of information on the maturity of each loan individual loans made to businesses. Conreported. In compiling the results of the Quar- 3See the appendix, which describes the principles used in selecting the random sample. 2 Many banks that are heavily engaged in farm lend­ 4 Some banks that have computerized data systems ing are small and therefore often need the participation are reporting by magnetic tape or cards, obviating the of other lenders in their larger loans. need to fill out forms. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

444 Federal Reserve Bulletin □ May 1977 struction loans secured by real estate are re­ vey of business lending is also reproduced at ported on this form as well, and the type of the end of the article. About 250 member banks structure being financed by construction loans provide monthly information on business loans. is reported by responding banks. The second Like the quarterly survey, the monthly supple­ form used in the quarterly survey covers loans ment is conducted during the first full business to farmers. The purpose of agricultural loans week of the month. (feeder livestock, machinery and equipment, The results of the quarterly surveys and the and so forth) is also reported by respondents, monthly supplements will be used to approxi­ and the classifications correspond to the cate­ mate the lending terms of the banking system gories in the Survey of Selected Interest Rates, as a whole. Respondents’ loans are weighted the agricultural portion of which is replaced by by the relationship between the amount of loans the STBL. in each category as reported on the call report The form for the monthly supplemental sur­ and the total volume of such lending by banks 1. Survey of terms of bank lending Short-term commercial and industrial loans (other than construction and land development) made during February 7-12, 1977 Size of loan (in thousands of dollars) All Item sizes 1,000 1-24 25-49 50-99 100-499 500-999 and over All banks Amount of loans (thousands of dollars)............... 5,264,153 668,619 356,031 622,569 1,015,065 437,161 2,164,708 Number of loans................................................. 125,377 97,688 10,896 9,516 5,814 709 754 Weighted-average maturity (months).................... 3.4 3.6 4.3 3.4 3.6 3.1 3.1 Weighted-average interest rate (per cent)............... 7.48 8.99 8.43 8.43 7.64 7.15 6.57 Standard error i............................................... n.a. n.a. n.a. n.a. n.a. n.a. n.a. Interquartile range2.......................................... 6.40-8.54 8.24-9.50 7.47-9.31 7.32-9.38 6.62-8.68 6.40-7.71 6.25-6.62 Percentage of amount of loans: With floating rate............................................. 44.5 11.7 26.2 16.0 38.5 58.3 65.9 Made under commitment................................. 47.9 23.0 33.5 24.2 48.9 54.9 62.8 Insured by Federal Government....................... .8 .2 .7 .2 .4 .4 1.5 48 large banks Amount of loans (thousands of dollars)............... 2,272,560 74,997 65,461 82,939 299,115 216,164 1,533,884 Number of loans................................................. 14,897 9,220 1,976 1,311 1,587 342 461 Weighted-average maturity (months).................... 3.4 4.4 4.7 3.9 3.2 3.0 3.2 Weighted-average interest rate (per cent)............... 6.82 8.34 7.90 7.73 7.35 7.17 6.49 Standard error 1............................................... n.a. n.a. n.a. n.a. n.a. n.a. n.a. Interquartile range2.......................................... 6.25-7.25 7.27-9.18 7.27-8.54 7.00-8.27 6.66-7.76 6.40-7.50 6.25-6.50 Percentage of amount of loans: With floating rate............................................. 66.5 42.0 55.3 56.7 63.5 72.4 68.4 Made under commitment................................. 54.2 37.6 48.8 48.9 54.4 45.6 56.7 Insured by Federal Government....................... 1.8 1.2 1.6 1.0 1.3 .8 2.1 Other banks Amount of loans (thousands of dollars)................ 2,991,592 593,622 290,570 539,630 715,950 220,996 630,824 Number of loans................................................. 110,480 88,468 8,920 8,205 4,227 367 293 Weighted-average maturity (months).................... 3.5 3.5 4.2 3.3 3.8 3.1 2.8 Weighted-average interest rate (per cent)............... 7.98 9.07 8.55 8.54 7.77 7.13 6.76 Standard error i............................................... .07 .14 .14 .24 .11 .07 .11 Interquartile range2.......................................... 6.50-9.10 8.25-9.50 7.75-9.31 7.50-9.38 6.62-8.77 6.40-7.71 6.25-6.75 Percentage of amount of loans: With floating rate............................................. 27.9 7.9 19.6 9.8 28.0 44.5 59.9 Made under commitment.................................. 43.1 21.2 30.1 20.4 46.6 64.1 77.7 Insured by Federal Government........................ .1 .1 .5 i The chances are about 2 out of 3 that the average rate shown 2 The interquartile range shows the interest rate range that enwould differ by less than this amount from the average rate that would compasses the middle 50 per cent of the total dollar amount of loans be found by a complete survey of lending at all banks. made. n.a. Not available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Survey of Terms of Bank Lending 445 of similar size.5 Consequently, the survey pro­ SURVEY RESULTS vides estimates not only for the terms of bank Tables 1 to 4 summarize the results of the first lending but also for the gross volume of new survey, taken in February 1977. They cover, in lending. The reliability of estimates of the vol­ turn, short-term business loans other than con­ ume of lending, however, is high only for struction loans, long-term (over 1 year in origi­ short-term business loans, which constitute a nal maturity) business loans other than con­ very high proportion of the loans reported in struction loans, construction loans secured and the survey. The estimates of the volume of unsecured by real estate, and loans to farmers. construction, agricultural, and long-term busi­ The tables do not contain regional information ness lending are based on much smaller samples on lending terms as did the QIRS because the of loans. sample is drawn on a national basis. A sample capable of producing regional data of compara­ 5 The appendix on the sample design explains more ble accuracy to those shown in the tables would fully the blow-up procedures. require a much larger panel of banks. 2. Survey of terms of bank lending Long-term commercial and industrial loans (other than construction and land development) made during February 7-12, 1977 Size of loan (in thousands of dollars) All Item sizes 1,000 1-99 100-499 500-999 and over All banks Amount of loans (thousands of dollars)...................................... 974,912 295,105 163,735 68,869 447,202 Nuntber of loans................................................................ 23,469 22,269 990 102 108 Weighted-average maturity (months).......................................... 41.7 41.4 38.1 38.1 43.7 Weighted-average interest rate (per cent)..................................... 8.19 10.00 8.39 7.44 7.04 Standard error i..................................................................... n.a. n.a. n.a. n.a. n.a. Interquartile range 2.............................................................. 6.85-9.00 8.50-10.47 7.34-9.00 6.40-7.99 6.52-7.59 Percentage of amount of loans: With floating rate................................................................... 50.9 18.8 45.3 66.6 71.7 Made under commitment....................................................... 47.4 24.1 33.3 65.9 65.2 Insured by Federal Goverment............................................... 2 2 .1 1 4.7 48 large banks Amount of loans (thousands of dollars)...................................... 502,565 33,271 46,390 36,760 386,144 Number of loans....................................................................... 2,094 1,754 204 57 79 Weighted-average maturity (months).......................................... 42.4 32.8 48.9 39.7 42.8 Weighted-average interest rate (per cent)..................................... 7.20 8.82 7.66 7.24 7.00 Standard error *..................................................................... n.a. n.a. n.a. n.a. n.a. Interquartile range 2................................................................ 6.52-7.75 7.45-9.65 6.55-8.41 6.40-7.72 6.52-7.59 Percentage of amount of loans: With floating rate................................................................... 74.6 59.4 76.7 84.0 74.8 Made under commitment....................................................... 64.0 51.2 53.1 74.1 65.4 Insured by Federal Government.................................*.......... 4 2 .6 5.4 Other banks Amount of loans (thousands of dollars)...................................... 472,347 261,834 117,345 32,109 61,059 Number of loans....................................................................... 21,375 20,515 786 46 29 Weighted-average maturity (months).......................................... 40.9 42.5 33.9 36.3 49.7 Weighted-average interest rate (per cent).................................... 9.25 10.15 8.68 7.68 7.29 Standard error1.................................................................... .16 .59 .18 .49 .41 Interquartile range2............................................................... 7.99-9.65 8.57-10.47 8.00-9.00 6.40-8.03 6.50-7.99 Percentage of amount of loans: With floating rate................................................................... 25.7 13.6 32.9 46.8 52.1 Made under commitment....................................................... 29.8 20.6 25.5 56.6 63.6 Insured by Federal Government............................................. .1 .1 .2 The notes are the same as those to Table 1. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

446 Federal Reserve Bulletin □ May 1977 The tables contain summary statistics for all and the number of payments over the life of commercial banks, 48 large money center the loan in calculating the average interest rates banks, and all other banks. Each table shows in the tables. The interquartile range is presented the volume and terms of lending for various size as a measure of the dispersion of lending rates. categories of loans at each class of bank. Nom­ Along with the average interest rates appears inal interest rates reported on loans are adjusted the standard error of the estimated average, for the method of interest calculation, maturity, which provides a measure of the reliability of 3. Survey of terms of bank lending Construction and land development loans (secured and unsecured by real estate) made during February 7-12, 1977 Size of loan (in thousands of dollars) All Item sizes 1,000 1-24 25-49 50-99 100-499 500-999 and over All banks Amount of loans (thousands of dollars). 977,682 107,586 72,575 87,635 146,517 44,026 519,352 Number of loans.................................. 17,917 13,133 2,094 1,378 851 60 402 Weighted-average maturity (months).... 10.6 10.8 6.2 5.7 6.9 10.6 12.7 Weighted-average interest rate (per cent). 8.40 9.33 8.97 8.80 8.38 8.27 8.08 Standard error1................................ n.a. n.a. n.a. n.a. n.a. n.a. n.a. Interquartile range2........................... 8.00-8.77 8.57-9.50 8.24-9.50 8.24-9.88 8.22-9.00 8.24-8.33 8.00-8.00 Percentage of amount of loans: With floating rate.............................. 25.1 16.7 17.7 21.4 43.2 55.2 20.9 Secured by real estate........................ 89.8 64.7 92.3 96.2 90.5 92.2 93.1 Made under commitment.................. 74.0 54.9 68.3 65.7 49.0 86. 1 86.2 Made for construction...................... 100.0 100.0 100.0 100.0 100.0 100.0 100.0 1-4 family..................................... 33.7 70.0 82.2 74.8 59.7 50.0 3.8 Multifamily................................... 43.1 2.0 5.4 3.8 8.0 15.6 75.8 Nonresidential............................... 23.1 27.9 12.4 21.4 32.4 34.4 20.4 Insured by Federal Government........ 1.5 .3 .9 2.7 6.5 4.9 48 large banks Amount of loans (thousands of dollars). . 119,990 8,410 7,194 6,896 43,675 12,962 40,853 Number of loans.................................. 1,668 1,112 211 102 206 20 18 Weighted-average maturity (months) 12.2 8.7 8.9 7.5 10.3 8.4 18.7 Weighted-average interest rate (per cent). 8.01 8.33 8.46 8.22 8.31 7.99 7.53 Standard error1................................. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Interquartile range2........................... 7.25-8.81 7.75-9.00 7.81-9.24 7.50-9.25 7.47-9.03 7.75-8.28 6.25-8.81 Percentage of amount of loans: With floating rate.............................. 90.2 83.6 77.8 87.3 91.9 100.0 89.4 Secured by real estate....................... 68.2 58.1 82.9 84.2 79.2 73.6 51.6 Made under commitment.................. 74.8 57.6 79.4 91.4 82.1 93.6 60.8 Made for construction...................... 100.0 100.0 100.0 100.0 100.0 100.0 100.0 1-4 family..................................... 39.6 75.9 61.7 52.8 44. 1 40.6 20.9 Multifamily................................... 5.2 3.7 5.7 12.3 6.5 14.2 .0 Nonresidential................................ 55.2 20.3 32.6 34.9 49.4 45.1 79.1 Insured by Federal Government.......... 2.5 .5 3.1 3.4 5.6 Other banks Amount of loans (thousands of dollars). 857,702 99,176 65,382 80,739 102,842 31,064 478,499 Number of loans................................. 16,248 12,021 1,883 1,276 645 40 384 Weighted-average maturity (months) 10.4 10.9 5.9 5.5 5.6 11.6 12.3 Weighted-average interest rate (per cent) 8.46 9.41 9.02 8.85 8.41 8.39 8.13 Standard error1.............................. .24 .22 .18 .17 .17 .22 .75 Interquartile range2......................... 8.00-8.77 8.71-9.50 8.24-9.50 8.24-10.00 8.24-9.00 8.25-8.33 8.00-8.00 Percentage of amount of loans: With floating rate............................ 16.0 11.0 11.1 15.8 22.5 36.5 15.0 Secured by real estate...................... 92.8 65.3 93.3 97.2 95.3 100.0 96.6 Made under commitment................. 73.9 54.6 67.0 63.5 34.9 83.0 88.4 Made for construction..................... 100.0 100.0 100.0 100.0 100.0 100.0 100.0 1-4 family................................... 32.9 69.5 84.5 76.7 66.3 53.9 2.4 Multifamily................................. 48.4 1.9 5.4 3.1 8.6 16.2 82.2 Nonresidential............................. 18.7 28.6 10.1 20.2 25.1 29.9 15.4 Insured by Federal Government....... 1.4 .3 .7 2.6 6.9 6.9 The notes are the same as those to Table 1. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Survey of Terms of Bank Lending 447 4. Survey of terms of bank lending Loans to farmers made during February 7-12, 1977 Size of loan (in thousands of dollars) All Item sizes 250 1-9 10-24 25-49 50-99 100-249 and over All banks Amount of loans (thousands of dollars)................ 809,024 171,247 143,928 137,765 112,606 101,382 142,097 Number of loans................................................. 66,285 49,541 9,805 4,387 1,674 715 162 Weighted-average maturity (months).................... 10.8 9.1 8.8 12.8 20.8 7.4 8.0 Weighted-average interest rate (per cent)............... 8.80 9.00 8.97 8.65 8.63 8.77 8.69 Standard error1............................................... n.a. n.a. n.a. n.a. n.a. n.a. n.a. Interquartile range2.......................................... 8.27-9.20 8.53-9.25 8.37-9.25 8.03-9.11 8.25-9.01 8.24-9.20 8.25-9.50 By purpose of loan: Feeder livestock........................................... 8.49 8.82 8.63 8.77 8.51 8.52 7.85 Other livestock............................................. 8.89 8.99 8.93 8.39 8.81 8.98 9.22 Other current operating expenses.................. 8.78 8.91 8.89 8.71 8.51 8.76 8.73 O Fa t r h m er m ... a .. c . h .. i . n .. e . r .. y .. . a . n .. d .. . e .. q .. u .. i . p . m ... e .. n .. t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9. . 0 8 6 0 9 9. . 2 1 6 4 9 8 . . 6 8 5 0 9 8 . .4 15 5 8 8 . . 5 97 6 8 8 . . 9 8 8 4 8.43 t Percentage of amount loans: With floating rate............................................. 15.6 4.9 7.1 4.0 8.3 13.1 56.0 Made under commitment................................. 37.3 24.0 22.9 32.8 47.4 45.2 58.7 By purpose of loan: Feeder livestock........................................... 13.9 10.3 14.1 11.8 10.9 23.4 15.9 Other livestock............................................. 14.7 12.9 10.6 19.2 13.7 8.2 22.0 Other current operating expenses.................. 35.7 45.0 39.1 24.5 32.5 44.8 27.9 Farm machinery and equipment.................... 13.7 18.9 19.1 16.0 11.0 2.3 t Other........................................................... 21.5 12.7 17.1 28.5 29.0 21.1 23.9 48 large banks Amount of loans (thousands of dollars)................ 98,226 3,163 4,144 4,653 7,802 11,471 66,994 Number of loans................................................. 1,472 815 280 139 114 78 45 Weighted-average maturity (months).................... 5.4 7.8 7.6 8.3 8.1 7.4 4.3 Weighted-average interest rate (per cent)............... 8.37 8.70 8.43 8.33 8.02 7.98 8.46 Standard error 1............................................... n.a. n.a. n.a. n.a. n.a. n.a. n.a. Interquartile range2.......................................... 7.85-8.84 8.11-9.13 7.98-9.00 7.80-8.81 7.00-8.81 7.31-8.56 7.85-8.84 By purpose of loan: O Fe t e h d er e r l i l v iv e e st r o s c to k c .. k .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 7. . 7 9 8 4 7 8 . . 7 1 8 0 7 7 . . 8 9 5 6 8 8 . . 1 2 7 4 6. ( 5 t 2 ) 7 7 . .5 5 3 4 6. ( 5 t 8 ) Other current operating expenses................... 8.61 8.76 8.52 8.27 8.36 8.39 8.70 Farm machinery and equipment.................... 8.77 9.31 9.06 (t) 8.33 (t) (t) Other........................................................... 8.48 8.85 8.48 8.51 8.28 7.62 8.63 Percentage of amount of loans: With floating rate............................................. 81.5 35.2 52.1 62.8 69.1 67.8 90.6 Made under commitment.................................. 70.4 57.4 61.7 57.6 75.6 78.5 70.4 By purpose of loan: O Fe t e h d er e r l i l v iv es e t s o to ck ck .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 6 1 . . 2 9 7 5 . .8 0 8 8. . 3 2 1 8 0 . . 8 4 16 ( . t 8 ) 1 7 4 . . 0 2 4(.t4) Other current operating expenses................... 49.8 61.4 54.7 64.4 54.3 42.4 48.6 O Fa t r h m er . m .. a .. c . h .. i . n .. e . r .. y .. . a . n .. d .. . e .. q .. u .. i . p .. m ... e . n .. t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1 0 . . 5 4 2 5 0 . . 1 4 2 4 4 . . 1 7 12 ( . t 3 ) 1 8 8 . . 6 6 32 ( . t 6 ) 33 ( . t 5 ) Other banks Amount of loans (thousands of dollars)................ 710,798 168,084 139,784 133,112 104,804 89,911 75,103 Number of loans................................................. 64,813 48,726 9,525 4,248 1,560 637 117 Weighted-average maturity (months).................... 11.6 9.2 8.8 12.9 21.8 7.4 13.3 Weighted-average interest rate (per cent)............... 8.86 9.01 8.99 8.66 8.68 8.87 8.89 Standard error1............................................... .06 .06 .12 .12 .16 .08 .36 Interquartile range2.......................................... 8.31-9.20 8.53-9.25 8.48-9.31 8.05-9.11 8.25-9.01 8.56-9.20 8.42-9.50 By purpose of loan: Feeder livestock........................................... 8.57 8.83 8.64 8.79 8.52 8.59 7.89 Other livestock............................................. 8.99 9.00 8.96 8.39 t 9.14 f Other current operating expenses................... 8.82 8.92 8.91 8.75 8.53 8.81 8.86 Farm machinery and equipment.................... 9.06 9.14 8.80 9.15 9.01 8.82 t Other........................................................... 8.87 9.27 9.70 8.45 8.57 9.27 8.03 Percentage of amount of loans: With floating rate............................................. 6.5 4.3 5.7 1.9 3.8 6.1 25.1 Made under commitment.................................. 32.8 23.4 21.8 31.9 45.3 41.0 48.4 By purpose of loan: Feeder livestock........................................... 14.2 10.4 14.2 11.9 11.6 24.6 18.1 Other livestock............................................. 15.9 13.1 10.6 19.5 t 8.3 t Other current operating expenses................... 33.8 44.7 38.7 23.2 30.9 45.1 9.5 Farm machinery and equipment.................... 15.4 19.1 19.6 16.4 11.2 2.3 t Other........................................................... 20.2 12.6 16.9 29.0 29.8 19.7 15.2 t Fewer than three sample banks. Other notes are the same as those in Table 1. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

448 Federal Reserve Bulletin □ May 1977 the estimate.6 Although measures of the relia­ interpretation of some parts of the survey find­ bility of other figures in the tables are not ings may become useful only as an historical shown, it must be emphasized that all the data data base develops. But some of the new infor­ in the tables are estimates.7 mation made available through the STBL pro­ The results of the quarterly survey for all vides insights into bank lending practices that commercial banks will appear regularly in the are of immediate interest. For example, the Financial and Business Statistics section of the survey confirmed the view that a high proportion Federal Reserve B ulletin, replacing Table of lending by banks, particularly large banks, 1.35 “Interest Rates Charged by Banks on is being made at floating rates. Fully two-thirds Business Loans.” The results of the quarterly of the dollar amount of short-term business survey and the monthly supplement will also loans made by large commercial banks carried be published as the Board’s G. 14 (formerly E.2) floating rates in the February survey, and nearly statistical release.8 one-third of such loans made by other banks Much of the information in the tables has not had floating rate agreements. been previously available or was available only In addition, the survey pointed out the wide in occasional special surveys. Consequently, extent to which bank borrowers are relying on prior commitments for loans. Commitments were associated with almost half of the business 6Additional programming is being performed to loans and about three-fourths of the construction compute standard errors for interest rates on loans loans reported on the survey. The widespread made at the 48 large banks; meanwhile, standard errors will be published for loans at other banks. practice of arranging prior commitments was 7Standard errors for all the estimates will be avail­ found at both the large banks and the other able later and may be obtained from the Banking Section banks. The proportion of lending under prior of the Division of Research and Statistics. commitments will likely rise and fall over 8Copies may be obtained from Publications Services, the business cycle in response to changes in Division of Administrative Services, Board of Gover­ nors of the Federal Reserve System, Washington, D.C. general credit conditions, and the survey will 20551. provide a guide to these developments. APPENDIX Sampling Procedures of the Survey of Terms of Bank Lending The population to be sampled by the Survey of The method of stratification (the cumulative Terms of Bank Lending was defined to be all in­ square root procedure) was to approximately sured commercial banks in the United States. The equalize the products of the number of banks in banks were ranked by the volume of commercial the strata and the standard deviations of commer­ and industrial loans in their portfolios as of June cial and industrial loans about the mean of the 30, 1974, and divided into six strata. The largest strata. The number of banks in a stratum is in­ 48 banks were assigned to the top stratum with versely related to the size of the banks; the strata certainty, that is, all were included in the sample. for larger banks contain relatively few banks, Such banks accounted for about 50 per cent of while the strata for smaller institutions contain all commercial and industrial loans of commercial many banks. banks. The remaining more than 14,000 banks in The two strata containing the banks with the the United States were divided into five strata. smallest business loan portfolios were combined and re-ranked by agricultural loans and re-divided into two strata. These two lowest strata account for a substantial portion of commercial bank agri­ Note.—The STBL sample was designed by Irving Gedanken, Senior Statistician in the Division of Re­ cultural lending (more than 70 per cent of all search and Statistics until his recent retirement. loans to farmers), and the reliability of farm loan Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Survey of Terms of Bank Lending 449 information was thus improved. There would be of the population and is a replicate of the other little deterioration in the reliability of business five subsamples. By ratio-estimate procedures re­ loan information from this procedure, since the lating call report totals for a particular loan cate­ larger banks represented in the top four strata of gory at sample banks to call report totals at all the sample account for about 85 per cent of busi­ banks, the reports of the 340 banks in the sample ness lending. are blown up to population estimates. Likewise, Before selecting the reporting panel from the the six subsamples are each separately blown up banking system so stratified, each stratum was di­ to the population. Thus, seven estimates of the vided into 10 zones containing equal numbers of characteristics of the population are calculated, banks. Six banks were then selected from each one over-all estimate from the large sample and of the 50 zones (10 zones in each of the 5 strata) six from subsamples of the whole. According to into which banks other than the 48 large banks the central limit theorem, samples of the same were divided. Not all banks were able to partici­ size tend to distribute themselves about the mean pate in the voluntary survey, and the final sample of the population in a normal distribution. Rely­ design called for a panel of about 340 banks. As ing upon this characteristic of the replicated esti­ banks merge or otherwise are dropped from the mates of the population, estimates of the variance panel, replacements will be selected to keep the of the elements can be readily calculated, and the sample representative of the population. standard errors for interest rates will be published By dividing the strata into zones from which regularly. six banks were chosen, it became possible to The first survey collected information on 23,identify six subsamples, each representative of the 201 business and construction loans and 2,740 entire population of banks. The six banks chosen loans to farmers. These loans were estimated to randomly within a zone were identified numeri­ represent about 150,000 business loans, 18,000 cally as one to six in order of selection. The first construction loans, and 66,000 farm loans made bank selected from each zone in a stratum was by the banking system during the survey period. assigned to subsample one of the stratum, the sec­ The relative coverage of business lending is ond was assigned to subsample two, and so forth. higher than in agricultural lending because the Consequently, in addition to the sample of 60 sampling method concentrated more heavily on banks from each stratum, six subsamples of the banks with higher business loan volume. How­ 10 randomly selected banks were identified. Over ever, the standard error of the estimates of interest the five sampled strata, the 300 respondent banks rates on agricultural loans at smaller banks, other constitute six subsamples of 50 each. Including than the 48 large banks in the first stratum, are the certainty stratum of 48 banks, each complete comparable to those on short-term business loans. subsample of the banking system is made up of The underlying variability of lending rates to about 98 banks. farmers appears to be less than the variability of Each of the six subsamples is a cross-section commercial loan rates. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

TERMS OF BANK LENDING TO BUSINESS FR 2028A Approved by Federal COMMERCIAL, INDUSTRIAL, AND CONSTRUCTION AND LAND DEVELOPMENT Reserve Board -- July 1976 Approval Expires Feb. 1979 LOANS MADE ON____________________________________ This report is authorized by law [12 U.S.C. 248(a) and 12 The Federal Reserve System regards the individual bank Page_ _of _ U.S.C. 248(i)] . Your voluntary cooperation in submitting information provided by each respondent as confidential. this report is needed to make the results comprehensive, If it should be determined subsequently that any informa­ accurate, and timely. tion collected on this form must be released, respondents will be notified. (Please read instructions before completing form) M D A A D TE E FAC O E F A L M O O A U N NT RATE OF INTEREST M S A T T A U T R U I S TY COMMITMENT STATUS IN F S S E T U D A R E T A R U N A S C L E COLLATERAL AND PURPOSE Check one Complete columns 1 2 and 13 Vlethoc Rate over only for construction and of life of ° ° (a) (b) (c) land development loans loan _Q O Check one Check one Check one c E 3 ~ — ® Q. s c (a) (b) (c) (a) (b) (c) (a) (b) Date £ c > o <’ n "C2D T o (/ 3 ) C T O O of -a S 0 C 0 O ^ '5 D i S n r t t a o e a t f r t e e e d st o c o - c 9 6 ' 0c E c 2 ro 5 ? S c cT X ! X c 0 0 o ) Ii ) ) m (If e z a e n t n r u t o o e r n ) r i t e y , . S2< m E > t / r > £ T t E ^ >T j J O c L o o m u a n m n d i m e t r m a a d e e n t co F m ee m o s n i p tm ai e d n t o1 £ _ X - 1 > O I - o 1 r 3o O a > 1 D c CroT ) T 1 3 C- O 3 J Qa , j. s L ec o u a r n ed 1-4 Multi­ N re o s n i­ ­ P s r e i e r m s c e b t u a a y a l r t r e e il d y Mo. Day Mil. Thou. Dol. Per cent Q < oi LL a > o' r a Yes | No Yes No C 3 £ o Z o o . Yes No Family family dential Yes No 1 2 3 4 5 6 7 8 9 10 11 12 13 .......! 1 1 ......r ■ ■ ” 1 1 I 1 1 i 1 I ' 1 1 i ~T 2 I 1 1 i 1 I 1 1 i 1 3 I 1 1 i 1 [' 1 1 i ......T.. 4 I 1 1 i 1 1~ r .....”i .. ..... I 5 I i i i 1 t ■ ........r...... t i 1 i i i i 1 6 t ■ t t~....... t 1 I i i i 1 7 i - t-..... t t........ t i i i i 1 8 -----f— ---h........t........ ...... +— i 1 1 i 1 9 -----1— H... i. .. . i 1 1 1 1 10 i_... i i Return one copy to the Federal Reserve Bank of Bank name, branch number Person to be contacted concerning this report _________________________________ ___________________________________________________________________________________By______________________________________ Office address Area code, telephone no. 450 Federal Reserve Bulletin □ May 1977 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INSTRUCTIONS FOR FR 2028A This report covers loans classified in Schedule A of the Report 2. Face amount of lean. Enter the face amount of loan in dol­ If the loan «s under- a commitment so defined, check of Condition (Call Report) under Item 5, "Commercial and in­ lars. If the note represents the fust advance of a loan agree­ sr! colurr-n 8 and the appropriate response in coijmn 9 dustrial Loans , and lt°m 1a, "Construction and Land Develop­ ment or an addition to an existing loan, enter the amount If the loan is not made under a commitment or if the ioan -s ment Loans", secured primarily by real estate. Report loans to advanced on the date shown in column 1. a participation originated by another lender and your oank is farmers on FR 2028B. unaware of the commitment status of the loan, check “no'' 3. Stated rate of interest. Enter the stated initial rate of interest in column 8 and skip column 9. INCLUDE: New loans which are defined as advances of funds shown in the note or agreement in per cent to three decimal to borrowers during the report period, takedowns places. Report an 8-1/4 per cent rate as 8.250. Commitment fees are payments for access to credit under under revolving credit agreements, notes written commitments and should exclude interest payments on indi­ under credit lines, and renewals. 4. Method of calculation. Check the appropriate space. vidual loans under commitments. Fees may be based on the amount of the total commitment, the unused portion of the Your bank's portion of loan participations. "Discount" applies when the proceeds credited to the bor­ commitment, or both and may be charged once or period­ rower are the face amount less the interest based on the face ically. If any fees have been levied on commitments as«o- Commercial and industrial loans made at all offices amount to be paid at maturity. ciated with the loan, check "yes" in column 9, if not check of your bank in the States of the United States and "no". the District of Columbia to any borrower domiciled "Add-on" applies when the borrower repays the face amount in the States of the United States, the District of plus interest calculated on the face amount for the full period 10. Federal insurance status. Check whether the loan is fully or Columbia, or U.S. territories and possessions, in­ until maturity. partially insured or guaranteed either by the Small Business cluding U.S. branches or subsidiaries of foreign busi­ Administration or by any other agency or department of the nesses. (C&l loans include construction and land "Remaining balance" applies when the interest for any period U.S. Government, including wholly-owned government cor­ development loans not secured primarily by real is charged on the outstanding balance of the loan during that porations. If the loan is not insured by an agency or estate to builders and developers in the States of period. department of the U.S. Government, check "not insured by the United States, the District of Columbia, and all U.S. agencies or departments." U.S. territories and possessions.) 5. Rate over life of loan. Check the appropriate space. 11. Loan secured. Check whether the loan is secured by collateral Construction and land development loans secured "Floating" applies when the rate is tied to some other rate of any kind. primarily by real estate made to any borrower dom­ (such as- the prime rate or a market interest rate) and neither iciled in the States of the United States, the Dis­ the bank nor the borrower knows the exact rate of interest to 12 13. Construction and land development loans. These columns trict of Columbia, or U.S. territories and possessions. be charged over the life of the loan. apply only to those loans made for the purposes of financing construction of new structures, demolition of existing struc­ EXCLUDE: Purchased loans and open market paper such as "Predetermined" applies when both the bank and the bor­ tures to make way for new structures, or for land improve­ commercial paper and acceptances. rower know the exact rate of interest to be charged over the ment prior to construction. In column 12. check the appro­ life of the loan. Do not check "predetermined" if at any time priate space to indicate the intended principal use of the Accounts receivable loans.. during the life of the loan the rate is floating. property involved. If the ultimate structure type is unknown, check "non-residential". Note that all loans classified as con­ Loans made by an international division or an inter­ 6-7. Maturity status. If the loan has a specific maturity, enter struction loans, regardless of collateral, are limited to loans national operations subsidiary of your bank. the month and year in column 6. Include due dates for notes with original maturities of 5 years or less. All such loans of with specific maturities written under revolving credit agree­ longer maturity are assumed to be permanent financings and Loans made to business firms domiciled outside of ments. If the loan is an instalment loan, enter the date of the are not reported as construction loans. the United States, the District of Columbia, and all last payment. If the loan is a demand loan and has no stated U.S. territories and possessions (foreign loans). maturity, enter "JD" and skip column 7. If the loan is primarily secured by real estate, check "yes" in column 13. Such loans would be classified on the Report of Loans of less than $1,000. For those loans with stated maturities, enter in column 7 the Condition in Schedule A as Item 1a. number of payments on the principal scheduled over the life INFORMATION TO BE REPORTED of the loan. If the loan is a single payment note, enter "1". Check "no" in column 13 if the construction loan is not ON EACH LOAN If the payments are not explicitly scheduled, enter "0". primarily secured by real estate. Construction loans not sec­ ured by real estate would be classified in the Report of Con­ COLUMN NUMBER 8-9. Commitment status. For purposes of this survey, a commit­ dition in Schedule A, as part of Item 5. ment is defined as an official promise to lend a specified 1. Date made. Enter the calendar date the loan or renewal was amount that is expressly conveyed, orally or in writing, to the made. For a loan made on November 3, enter 1103. customer. Such commitments should include revolving credits and approved lines of credit. Authorizations (internal guid­ ance lines) where the customer is not informed of the amount are not to be considered as commitments. Survey of Terms of Bank Lending Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FR 2028B TERMS OF BANK LENDING TO FARMERS Approved by Federal Reserve Board - July 1976 LOANS MADE ON _________________________________ Approval Expires Feb. 1979 This report is authorized by law [12 U.S.C. 248(a) and 12 The Federal Reserve System regards the individual bank Page- _of _ U.S.C. 248(i)]. Your voluntary cooperation in submitting information provided by each respondent as confidential. this report is needed to make the results comprehensive, If it should be determined subsequently that any informa­ accurate, and timely. tion collected on this form must be released, respondents will be notified. (Please read instructions before completing form) DATE FACE AMOUNT MATURITY FEDERAL LOAN PARTICIPATION PRIMARY MADE OF LOAN RATE OF INTEREST STATUS COMMITMENT STATUS INSURANCE SECURED STATUS PURPOSE OF LOAN STATUS Method Rate over Check one Check one Check one of life of t: c ® (a) (b) (c) (a) (b) (c) (a) (b) (c) (d) (e) calculation loan ° 2 Check one Check one Date . E Q ® o c o o Stated rate of interest detanigiro naol noitapicitr srehto (a) (b) (c) (a) (b) maturity 3 C ~ — X k. < > j> Loan made Fees paid c ° under a on (If none commitmentcommitment enter c T C J zero) i2 i> c 3 o -" c 9 oO c 1 ® c -2 s c C C C o T D > § < ® 5 • 2 1 s 5 ? s yb deetnaraug ro derui itartsinimdA emoH sremr yb deetnaraug ro derus stped ro seicnega .S.U reh c Ca CO >Tl </> D -0O) 3 - 52 X o- cetanigiro naol noitapicitr knab ruoy a> Mo. Day Mil. Thou. Dol. Per cent Q < o 2 LL CL Yr. |Mo. r a Yes | No Yes || No £ u! £ o Z O T a 3 > Yes No CtLo -Q> Q to . ->Q z I 1 5 - u - uX o <> aO a> . S > o J u o a> 5 - c £ 3o «C c ° o = 2 5 a a> > - £ ^ E E r « o g . E c 9 i <» - - £ < c( O a o 0 > 1 2 3 4 5 6 7 8 9 10 11 12 13 ' I i 'l I 1 1 1 1 1 I 1 1 1 1 I 1 1 1 1 2 I 1 I 1 1 _ I 1 1 1 1 3 I 1 1 1 1 I 1 1 1 1 4 I 1 1 1 1 I 1 1 1 1 5 I 1 1 1 1 I 1 1 1 1 6 | 1 1 1 1 I 1 1 1 1 7 I 1 1 I 1 I 1 1 1 1 8 I 1 1 1 1 I 1 1 1 1 9 I 1 1 1 1 I 1 1 1 1 10 .J__ .....1 .1 . ..L 1 Return one copy to the Federal Reserve Bank of Bank name; branch number Person to be contacted concerning this report Office address Area code, telephone no. 452 Federal Reserve Bulletin □ May 1977 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INSTRUCTIONS FOR FR 2028B This report covers loans classified in Schedule A of the Report 4. Method of calculation. Check the appropriate space. Commitment fees are payments for access to credit under of Condition (Call Report) as Item 4, "Loans to Farmers.” commitments and should exclude interest payments on indi­ Report business loans on FR 2028A. "Discount" applies when the proceeds credited to the bor­ vidual loans under commitments. Fees may be based on the rower are the face amount less the interest based on the face amount of the total commitment, the unused portion of the INCLUDE: New loans, which are defined as advances of funds amount to be paid at maturity. commitment, or both and may be charged once or period­ to borrowers during the reporting period, take­ ically. If any fees have been levied on commitments associated downs under revolving credit agreements, notes "Add-on” applies when the borrower repays the face amount with the loan, check "yes" in column 9, if not, check "no". written under credit lines, and renewals. plus interest calculated on the face amount for the full period until maturity. 10. Federal insurance status. Check whether the loan is fully or Your bank's portion of loan participations. partially insured or guaranteed by the Farmers Home Adminis­ "Remaining balance" applies when the interest for any tration or any other agency or department of the U.S. Gov­ Loans made to farmers at all offices of your bank period is charged on the outstanding balance of the loan ernment including wholly-owned government corporations. in the States of the United States and the District during that period. If the loan is not insured by an agency or department of the of Columbia to any farm borrower domiciled in the U.S. Government, check "Not insured by U.S. agencies or States of the United States, the District of Colum­ 5. Rate over life of loan. Check the appropriate space. departments." bia, or U.S. territories and possessions, including U.S. branches or subsidiaries of foreign businesses. "Floating" applies when the rate is tied to some other rate 11. Loan secured. Check whether the loan is secured by collateral (such as the prime rate or a market interest rate) and neither of any kind. EXCLUDE: Purchased loans and open market paper such as the bank nor the borrower knows the exact rate of interest to commercial paper and acceptances. be charged over the life of the loan. 12.Participation status. If the loan is participated, check whether it was originated by your bank or by other lenders. If the loan Accounts receivable loans. "Predetermined" applies when both the bank and the bor­ does not represent a participation with other lenders, check rower know the exact rate of interest to be charged over the "Not participated.'' Loans made by an international division or an inter­ life of the loan. Do not check "predetermined" if at any time national operations subsidiary of your bank. during the life of the loan the rate is floating. 13.Purpose of loan, indicate which one of the following classifi­ cations best describes the borrower's primary use of the loan Loans made to farmers domiciled outside of the 6-7.Maturity status. If the loan has a specific maturity, enter the funds: United States, the District of Columbia, and all U.S. month and the year in column 6. Include due dates for notes territories and possessions (foreign loans). with specific maturities written under revolving credit agree­ Feeder livestock. A loan used primarily to purchase feeder ments. If the loan is an instalment loan, enter the date of the cattle, feeder pigs, or feeder lambs to be fattened for Loans of less than $1,000. last payment. If the loan is a demand loan and has no stated slaughter. maturity, enter "0" and skip column 7. INFORMATION TO BE REPORTED For those loans with stated maturities, enter in column 7 the Other livestock: A loan used primarily to purchase poultry ON EACH LOAN number of payments on the principal scheduled over the life and livestock other than feeder livestock. of the loan. If the loan is a single payment note, enter "1". If the payments are not explicitly scheduled, enter "0". Other current operating expenses: A loan used primarily to COLUMN NUMBER finance such items as current crop production expenses and 8-9.Commitment status. For purposes of this survey, a commit­ the care and feeding of livestock (including poultry). 1. Date made. Enter the calendar date the loan or renewal was ment is defined as an official promise to lend a specified made. For a loan made on November 3, enter 1103. amount that is expressly conveyed, orally or in writing, to the Farm machinery and equipment: A loan used primarily to customer. Such commitments should include revolving credits finance purchases of tractors, trucks, machinery, and other 2. Face amount of loan. Enter the face amount of the loan in and approved lines of credit. Authorizations (internal guidance dollars. If the note represents the first advance of a loan agree­ lines) where the customer is not informed of the amount are farm equipment, such as irrigation equipment and equipment ment or an addition to an existing loan, enter only the not to be considered as commitments. for structural facilities (e.g., automated feeding equipment). amount advanced on the date shown. All other loans: A loan used for purposes not listed above as If the loan is made under a commitment so defined, check 3. Stated rate of interest. Enter the stated initial rate of interest "yes" in column 8 and the appropriate response in column 9. well as loans for which the primary purpose is unknown. shown in the note or agreement in per cent to three decimal If the loan is not made under a commitment or if the loan places. Report 8-1/4 per cent rate as 8.250. is a participation originated by another lender and your bank is unaware of the commitment status of the loan, check "no" in column 8 and skip column 9. Survey of Terms of Bank Lending 453 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

454 Federal Reserve Bulletin □ May 1977 FR 2028C MONTHLY SUPPLEMENT TO Approved by Federal Reserve Board - July 1976 TERMS OF BANK LENDING TO BUSINESS Approval Expires Feb. 1979 COMMERCIAL AND INDUSTRIAL Page___of___ LOANS MADE ON____________________________________ This report is authorized by law [12 U.S.C. 248(a) and 12 U.S.C. 248(i)] . Your voluntary cooperation in submittinq this report is needed to make the results comprehensive, accurate, and timely The Federal Reserve System regards the individual bank information provided by each respondent as confidential. If it should be determined subsequently that any information collected on this form must be released, respondents will be notified. (Please read instructions before completing form) DATE FACE AMOUNT MATURITY MADE OF LOAN RATE OF INTEREST STATUS Method of calculation Date of maturity Stated rate (If none, of enter interest zero) Mil. Thou. Dol. fo rebmun retne ,detats ytirutam fI naol fo efil revo stnemyap deludehcs Check one (a) c 3 O Mo. Day Q rc no-ddAj J I Tf gniniamer nO ecnalab Per cent Yr. | Mo. 1 2 3 4 5 6 I I I I I ! I 1 I I I I I ! I I I I I 2 I I I I | I I I I I I 3 I I t I I 4 I I I i I i I 5 l I I V \ ♦ I i I I I I 6 I ! ! I I I I i I 7 I : | I I 8 ! I I I I I 9 I j ......1 I I I 10 I I I ! i I I I 11 ! I I I I I i I I I I I 12 i I I I I I I I 13 I I I I Return one copy to the Federal Reserve Bank of________ ________________________by Bank name; branch number Person to be contacted concerning this report Office address Area code, telephone no. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Survey of Terms of Bank Lending 455 INSTRUCTIONS FOR FR 2028C This report covers loans classified in Schedule A of the Report of INFORMATION TO BE REPORTED Condition (Call Report) under Item 5, "Commercial and Industrial Loans." ON EACH LOAN COLUMN NUMBER INCLUDE: New loans which are defined as advances of funds to borrowers during the report period, takedowns under revolving credit agreements, notes written 1. Date made. Enter the calendar date the loan or renewal was made. For a loan made on November 3, enter 1103. under credit lines, and renewals. 2. Face amount of loan. Enter the face amount of loan in Youi bank's oortion of loan participations. dollars. If the note represents the first advance of a loan agreement or an addition to an existing loan, enter the Commercial and industrial loans made at all offices amount advanced on the date shown in column 1. of your bank in the States of the United States and the District of Columbia to any borrower domi­ 3. Stated rate of interest. Enter the stated initial rate of interest ciled in the States of the United States, the District shown in the note or agreement in per cent to three decimal of Columbia, or U.S. territories and possessions, places. Report an 8-1/4 per cent rate as 8.250. including U.S. branches or subsidiaries of foreign businesses. (C&l loans include construction and 4. Method of Calculation. Check the appropriate space. land development loans not secured primarily by real estate to builders and developers in the States "Discount" applies when the proceeds credited to the of the United States, the District of Columbia, and borrower are the face amount less the interest based on the all U.S. territories and possessions.) face amount to be paid at maturity. EXCLUDE: All loans secured primarily by real estate, including ail construction and land development loans se­ "Add-on" applies when the borrower repays the face amount cured primarily by real estate that are reported on plus interest calculated on the face amount for the full period the quarterly survey. until maturity. Purchased loans and open market paper such as "Remaining balance" applies when the interest for any commercial paper and acceptances. period is charged on the outstanding balance of the loan during that period. Accounts receivable loans. 5-6. Maturity status. If the loan has a specific maturity, enter Loans made by an international division or an the month and year in column 5. Include due dates for notes international operations subsidiary of your bank. with specific maturities written under revolving credit agree­ ments. If the loan is an instalment loan, enter the date of the Loans made to business firms domiciled outside of last payment. If the loan is a demand loan and has no stated the United States, the District of Columbia, and all maturity, enter "0" and skip column 6. U.S. territories and possessions (foreign loans). For those loans with stated maturities, enter in column 6 the Loans of less than $1,000 . number of payments on the principal scheduled over the life of the loan. If the loan is a single payment note, enter "1". If the payments are not explicitly scheduled, enter "0". Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

456 The Need for Order in International Finance I plan to comment tonight on the need for order disruption of the world economy during the war. in international finance. My choice of topic does Yet, it was the genius of that age to devise the not require lengthy justification. For more than structure of Bretton Woods and to strengthen a decade now, we have been besieged by prob­ that extraordinary structure with our own Mar­ lem after problem in the working of interna­ shall Plan. Within a framework of established tional financial mechanisms. Strain and turbu­ financial rules, a great liberalization of the world lence have, in fact, been so constant a feature economy occurred and world trade and output of the international financial scene in recent flourished. Although we tend to forget it now, years that I suspect they are coming to be widely the postwar period was a time of quite impres­ regarded as the normal state of affairs. sive stability in world finance until the early I do not share any such mood of resignation. 1960’s. In the first place, governments around the world That experience should serve to remind us now have a better understanding of the troubles that difficulties do yield to determined effort. caused by inflation—both in their own econo­ Our present problems in the sphere of interna­ mies and in international dealings—than they tional finance, while different from those of a had only a few years ago. As a result, not a generation ago, surely are no greater. They too few countries have been adjusting their eco­ can be dealt with effectively if once again we nomic policies with a view to curbing inflation. perceive the wisdom of some subordination of In the second place, financial institutions—par­ parochial interests and if nations marshal the ticularly commercial banks—are now giving will to live by new rules of responsible behav­ closer attention to the volume and character of ior. their foreign lending. And in the third place, Quite obviously, the overriding problem con­ the International Monetary Fund (IMF) has been fronting us in world financial matters today is gaining in prestige and is already exercising a the massive and stubborn imbalance that pre­ more constructive influence than seemed likely vails in payments relations among nations—a a year or two ago. These are promising trends, condition arising importantly, although by no and if we build on them we can in time reattain means exclusively, from the action of the Orga­ the financial stability that is so vital to orderly nization of Petroleum Exporting Countries expansion of the international economy. (OPEC) in raising the price of oil so abruptly Certainly, we all know of the great difficulties and so steeply. that plagued financial relationships among This year alone OPEC’s revenues from inter­ countries during the 1930’s. Those difficulties national oil sales are likely to total something generated pessimism about the capacity of na­ on the order of $130 billion. What is most tions ever again to achieve orderly arrangements significant about that figure is that it represents for the conduct of international finances. And an enormous explosion of revenues in such a that pessimism was deepened by the frightful short time. In 1972, before OPEC’s aggressive pricing policy began, receipts of the OPEC Note.—Address by Arthur F. Burns, Chairman, group from international oil sales totaled less Board of Governors of the Federal Reserve System, at than $14 billion, with most of the rise since the annual dinner of the Columbia University Graduate School of Business, New York, New York, April 12, then representing higher prices rather than en­ 1977. larged volume. For the great majority of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Need for Order in International Finance 457 OPEC’s customers—both affluent and needy a considerable period ahead. The prospect of alike—it has been the rapidity of the massive such persistent financing needs, year after year, change that has been so troublesome. To be is especially worrisome. sure, OPEC members have dispensed some aid Great as must be our attention to these to less-developed countries, but so far the grants OPEC-related problems, we dare not lose sight have been very selective and quite small relative of the fact that our international payments to the size of the international problems that mechanism is now under stress for reasons that OPEC has created. go beyond the extraordinarily high price of oil. The imposition of the enormous tax that the The payments deficits of various nations, both OPEC group has in effect levied on the world industrial and less developed, can be traced to economy has been met, as you know, partly extensive social-welfare and development pro­ by transferring goods and services to OPEC grams undertaken in the early 1970’s and fi­ members and partly by deferring such transfers nanced by heavy governmental borrowing, often through borrowing arrangements. OPEC’s ab­ directly from central banks. Even when the sorption of goods and services for both con­ internal stresses resulting from inflation were sumption and development purposes has been aggravated by the oil burden and by weaker expanding, with the consequence that OPEC’s exports, there was little or no adjustment of collective current-account surplus has shrunk economic policies in numerous instances, thus considerably from its peak level of more than causing external positions to deteriorate sharply. $65 billion in 1974. Only 5 of the 13 OPEC There were conspicuous exceptions, of course, nations in fact are currently running sizable particularly on the part of countries that histori­ payments surpluses. Contrary, however, to ear­ cally have the greatest sensitivity either to in­ lier widespread hopes that the aggregate OPEC flation or to payments imbalance, or both. A surplus would continue to decline—perhaps wide diversity of payments imbalances thus nearing elimination by the end of this decade— it developed around the globe, accentuated for a seems at present to be eroding slowly, if at all. time by differences in the severity with which This year it could easily run above $40 billion, recession affected national economies and, more marking the fourth consecutive year that recently, by differing inflation and recovery OPEC’s trading partners as a group will have trends. to seek substantial loans or grants to help meet The current pattern of international payments their oil bills. imbalances, in short, is something far more Continuation of a surplus for the OPEC group complex than an OPEC phenomenon alone. at such a high level reflects several influences: Essentially, what prevails is a problem within first, the further increase that occurred this Jan­ a problem. The non-OPEC group of countries uary in OPEC oil prices; second, growing de­ collectively not only has a massive structural mand for oil as recovery of the world economy deficit vis-a-vis OPEC. In addition, serious has proceeded; third, insufficient energy con­ payments imbalances exist within the nonservation by many non-OPEC countries, in­ OPEC sector itself, with a few nations ex­ cluding most notably the United States; and periencing sizable surpluses on their current fourth, a slowing of import absorption by the account while many others suffer deficits that OPEC group— in some instances because bot­ reflect many factors besides the way in which tleneck problems of one kind or another are the burden of costly oil imports happens to be being encountered, in other instances because distributed around the globe. development plans have come to be viewed as A great deal of effort has been devoted by excessively ambitious. The apparent stickiness scholars to the task of trying to estimate how of the OPEC payments surplus at a high level, long the present severe imbalance of interna­ buttressed by what is now a significant stream tional payments accounts could persist in the of income from investments, implies large-scale absence of deliberate new policy actions. The financing requirements for OPEC customers for results of these exercises generally are not reas­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

458 Federal Reserve Bulletin □ May 1977 suring. They point to the distinct possibility that of the painful things that must be done to huge borrowing needs—that is, needs that are restrain inflation and to achieve energy conser­ uncomfortably large in relation to the debt-serv­ vation. Countries thus find it more attractive to icing capabilities of many countries—could borrow than to adjust their monetary and fiscal persist at least through the remainder of this policies; and if they can do this without having decade. lenders write restrictive covenants into loan The potential trouble in this set of circum­ agreements, so much the better. That is why stances should be obvious. If OPEC surpluses countries typically prefer to tap foreign credit on current account should continue on anything markets to the maximum extent possible rather like the present scale, they would inevitably be than to borrow from the IMF, which, in aiding matched by deficits of identical magnitude on countries that experience significant payments the part of other nations. And if some countries disequilibrium, makes credit available only after outside OPEC should also have sizable and the borrower has agreed to follow internal poli­ persistent surpluses, as now appears to be the cies judged appropriate by the Fund. Commer­ case, the aggregate deficit of the remaining cial banks, as a practical matter, have neither countries will be still larger. Under such cir­ the inclination nor the leverage to impose re­ cumstances, many countries will be forced to strictive covenants on sovereign governments. borrow heavily, and lending institutions may In these circumstances, admonition alone is well be tempted to extend credit more gen­ likely to accomplish little in prodding countries erously than is prudent. A major risk in all this with large payments deficits to take affirmative is that it would render the international credit action. There are, however, limits dictated by structure especially vulnerable in the event that financial prudence beyond which private lenders the world economy were again to experience will be unwilling to go. More than one country recession on the scale of the one from which has recently found that its ability to borrow in we are now emerging. the private market has diminished. The fact is To minimize the risks that face us, there is that commercial banks generally, and particu­ a clear need for a strong effort involving all larly those which have already made extensive major parties at interest. In order to achieve loans abroad, are now evaluating country risks relatively smooth expansion of the world econ­ more closely and more methodically. Credit omy, five conditions are essential: First, the standards thus appear to be firming; and as aggregate of payments imbalances around the information about borrowing countries im­ world needs to be reduced far more rapidly than proves, we can reasonably expect the market currently observable trends imply; second, the to perform its function of credit allocation more divergences that now exist among countries with effectively. regard to their balance of payments status need As some of you may know, the Federal to be narrowed; third, protectionism must be Reserve is currently engaged in a joint project scrupulously avoided by governments; fourth, with other central banks to obtain a much more private financial institutions need to adhere to complete size and maturity profile of bank credit high standards of creditworthiness in providing extended to foreign borrowers, country by whatever volume of international financing country. That information, which is being gath­ occurs during the next few years; and fifth, ered under the auspices of the Bank for Interna­ official credit facilities need to be significantly tional Settlements, (BIS) will be shared with enlarged. private lenders, but even so it will fill only a The realization of these conditions requires fraction of the existing informational gap. diligent pursuit of stabilization policies by What we need is a more forthcoming attitude countries that have been borrowing heavily in on the part of borrowing countries in regularly international markets. The obstacles to speedy supplying information to lenders on the full adjustment on the part of these countries are range of economic and financial matters relevant well known. Resistance stems chiefly from the to creditworthiness. I realize that much of the political difficulty of gaining broad acceptance needed information is not even collected in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Need for Order in International Finance 459 some countries, but such a condition should not standably wish to see an increase in the relative be tolerated indefinitely. Logically, the BIS— volume of official financial support to countries having links with the central banks of the that continue to have large borrowing needs. principal lending countries—could take the lead Bankers are not alone in wanting to see in setting forth a list of informational items that countries in deficit pursue adjustment policies all countries borrowing in the international more diligently. This interest, in fact, is widely market would be expected to make available to shared by economists and other thoughtful citi­ present or prospective lenders. Compliance zens who see an urgent need for healthier and could then become a significant factor in the more prosperous economic conditions around ability of countries to secure private credit, the world. The interests of the international particularly if—as I would judge essential— economy and of private lenders thus converge bank regulators in the various lending countries and point to the need for a much more active explicitly took account of compliance in their role by the Fund. review of bank loan portfolios. The leverage of the Fund in speeding the Imperfect or incomplete information, as I process of adjustment would clearly be en­ think we all recognize, makes for inefficient hanced if its capacity to lend were greater than markets and heightens the risk of disruptive it is now. One reason why countries often are discontinuities if some previously unknown but unwilling to submit to conditions imposed by pertinent fact suddenly comes to light. In the the IMF is that the amount of credit available market for bank credit, a continuous flow of to them through the Fund’s regular channels—as factual information will produce gradual, as determined by established quotas—is in many distinct from abrupt, changes in assessments of instances small relative to their structural pay­ creditworthiness. This should induce earlier re­ ments imbalance. That will be so even after the course to the IMF by countries experiencing scheduled increase in IMF quotas becomes ef­ payments difficulties than has been usually the fective. To remedy this deficiency, the Fund is case in the past. Even now, as lenders are currently seeking resources of appreciable becoming better informed and somewhat more amount that could be superimposed on the cautious in extending foreign credit, a tendency framework of the quota system. Negotiations toward earlier recourse to the IMF appears to are in progress with several countries of the be emerging. It seems likely, therefore, that OPEC group as well as with the United States more countries that need to adjust their eco­ and other industrial nations whose payments nomic policies will henceforth do so sooner and position is comparatively strong. Such a sup­ probably also more effectively. By so doing, plementary Fund facility should induce more the unhappy alternative of resorting to protec­ deficit countries to submit to Fund discipline. tionism will be more readily avoided. But in no case must it become a substitute for Private banks—both in this country and else­ an adequate adjustment policy by borrowers or where—played a very substantial role in “recy­ serve as a bailout for private banks. If negotia­ cling” petrodollars between the OPEC group tions for such a facility are completed soon, and other countries, especially those whose ex­ which appears possible, high priority should be ternal payments position was weakened by the given to prompt ratification by our Congress and higher oil prices. Had the banks not done so, the legislatures of other countries. the recent recession would have been more The ability of the Fund to act forcefully in severe than it was, since there was no official speeding the adjustment process will be mechanism in place that could have coped with strengthened in still another way once the 5-year recycling of funds on the vast scale that became effort of amending the IMF’s Articles of necessary in 1974. But with many countries now Agreement is completed. At present the Fund heavily burdened with debt, bankers generally normally immerses itself in urging appropriate recognize that prudence demands moderation on policies on a country only when that country their part in providing additional financing for applies for financial assistance. Under the re­ countries in deficit. For that reason, they under­ vised Articles, the Fund could take the initiative Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

460 Federal Reserve Bulletin □ May 1977 in determining whether individual countries are The suggestions I am exploring with you for complying with formally prescribed obligations improving the adjustment process obviously will to foster orderly economic growth and price not work unless broadly shared agreement de­ stability. This authority, once available, will velops that international financial affairs require enable the IMF to broaden progressively its a “rule of law” to guide us through the troubled oversight role even when a country is not an circumstances that now exist. Such a rule cannot applicant for a loan. be codified in detail, but it is essential that there As the number of countries brought within be broad agreement that parochial concerns will the reach of the Fund’s influence increases—ei­ be subordinated to the vital objective of working ther because of the enticement of enlarged our way back to more stable conditions in inter­ lending facilities or because an IMF “certificate national finance. And if the IMF is to play a of good standing” becomes essential to further leadership role in pursuing this objective, it is borrowing from private lenders—the outlook for not only private parties that must avoid weak­ correction of balance of payments deficits would ening the IMF’s efforts. Governments also—in­ be considerably improved. But that outcome deed governments especially—must be prepared will also depend on full appreciation by private to forego their own quite frequent inclination lenders of the need to avoid actions that tend to do things inconsistent with the effective pur­ to undercut Fund efforts. suit of Fund objectives. There have been too This does not mean that Fund judgments are many instances in which the government of a to replace those of private lenders in the deter­ country negotiating a stabilization program with mination of which countries should be accom­ the Fund’s officials has attempted to circumvent modated with private credit. Nor do I even mean the Fund by seeking instead a loan from another to suggest that the texts of the Fund’s country government or by exerting outside political evaluations are to be handed around in the pressure on Fund officials in an effort to make private banking community. Were that to be­ loan conditions as lenient as possible. If the rule come a practice, I am sure the quality of such of law in international monetary affairs is ulti­ reports would suffer by becoming less explicit mately to prevail, all countries—there can be and less frank. But some sharing of Fund infor­ no exceptions—must fully respect the IMF’s mation—within the limits imposed by require­ integrity. ments of confidentiality—may still become fea­ Our first requisite, therefore, is for a new sible, the most logical conduits perhaps being sense of commitment by governments as well the central banks of the countries in which the as private parties to a responsible code of be­ major private lending institutions are located. havior. I believe that understanding of this need Fund country reports are transmitted to cen­ has been growing—certainly within our own tral banks as a matter of routine, and—as I government. And, of course, the working of the previously indicated—new factual information marketplace—tending now to make credit less about individual countries is now being devel­ readily available to some foreign borrowers—is oped, and more may well be developed later, helping to foster a new set of attitudes. by the BIS. Private lenders might want to As I noted earlier, the payments difficulties discuss with the staffs of central banks the flow of countries outside the OPEC group reflect of such information, and this could be done—as many factors besides the way in which the would surely be the Federal Reserve’s prac­ burden of oil costs happens to have been dis­ tice—without advising whether or on what scale tributed. It is important that adjustment proceed a loan should be made to this or that country. along several paths in this vast part of the world. Such a consultative process, especially if it also First, countries whose external position has involved frequent interchange of information been weakened by loose financial policies are among the leading central banks, would go quite going to have to practice some fiscal and mone­ far in preventing any inadvertent circumvention tary restraint, either of their own volition or by private banks of the efforts of the IMF to because they find it obligatory to do so in order promote financial stability. to maintain access to international credit facili­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Need for Order in International Finance 461 ties, including those of the IMF. In individual must be a major part of our Nation’s economic instances, the adjustment process in such coun­ policy. tries may at times also entail allowing some If, in fact, we can build momentum into depreciation of the foreign exchange value of payments adjustment by the non-OPEC group their currencies. of countries along these three paths—that is, Second, since the burden of adjustment can­ internal discipline by countries in deficit, not and should not rest with deficit countries nonresistance to exchange-rate appreciation by alone, those non-OPEC countries that are ex­ countries in surplus, and determined energy periencing significant and persistent current-ac­ conservation by all—the favorable conse­ count surpluses must understand that they too quences will be enormous. To the extent that have adjustment obligations. In saying this, I energy conservation is effective, the present do not mean to imply that we should urge such serious imbalance of the non-OPEC group of countries to pursue expansionist policies that nations vis-a-vis OPEC will be reduced. Beyond could undo or jeopardize the hard-won progress that, there will no longer be such extremely that some of them have made in curbing infla­ large differences in the balance of payments tion. That would be both wrong and unwise. status of the non-OPEC nations. Consequently, What I mean is simply that such countries the risk of disruption of the international finan­ should not actively resist tendencies toward ap­ cial system would be greatly reduced, and we preciation in the value of their currencies in could have greater confidence that progress will foreign exchange markets. Such appreciation be realized around the world in reducing unem­ will aid other countries by facilitating access to ployment and otherwise improving economic the markets of the countries in surplus; and at conditions. the same time it will make imported goods and There is a critical proviso, however, to this services available at a lower cost to the citizens optimistic assessment—namely, that the OPEC of the surplus countries, thus reinforcing their group, seeing their surplus decline as a result constructive efforts to control inflation. of foreign conservation efforts or their own Third, practically all non-OPEC countries— increasing imports, will not seek to compensate the deficit and surplus countries alike—must for the decline by a new round of oil-price treat energy conservation as a key element of increases. Obviously, if they were to do so— their economic policy. This is something to and if they could make the action stick—the which the United States in particular must give whole exercise of trying to reduce the massive the closest attention. We are by far the largest payments imbalances traceable to the oil shock single consumer of energy in the world, and would be rendered futile. we have so far been notably laggard in address­ Effective oil conservation and the develop­ ing the energy problem. This year imported oil ment of other sources of energy would, of will probably account for over 40 per cent of course, militate against such an outcome to the domestic consumption of petroleum, up from extent that those efforts lessened OPEC’s market 22 per cent in 1970. Our passive approach to leverage. That is important for the longer run, energy policy, besides endangering the Nation’s but particularly in the years immediately ahead future, has aggravated strains in the interna­ it is vital that the members of OPEC recognize tional financial system because we are directly that their economic and political future cannot responsible for a large part of the OPEC surplus. be divorced from that of the rest of the world. And, of course, our huge appetite for oil has Besides practicing forbearance with regard to added to the leverage of those OPEC members the price of oil, it would be very helpful if they that have been most reckless in urging a still made larger grants of assistance to the less-de­ higher price of oil. The energy program being veloped countries and also expanded the volume prepared by President Carter unquestionably of loans and investments made directly will entail sacrifices by many of our citizens. abroad—so that the intermediation of American It is essential, however, that we at long last or European commercial banks may be substan­ recognize that a decisive conservation effort tially reduced. Fortunately, there are various Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

462 Federal Reserve Bulletin □ May 1977 signs that the more influential members of central banks could work together through the OPEC are becoming increasingly aware that BIS and establish a common list of informa­ their self-interest requires a major contribution tional items that borrowing countries will be along these lines. The OPEC group has become expected to supply to lenders. a large factor in international finance, and there Fourth, commercial and investment bankers is some basis for confidence that they will play need to monitor their foreign lending with great a constructive role in the re-establishment of care, and bank examiners need to be alert to order in the international financial structure. excessive concentration of loans in individual In the course of my remarks tonight, I have countries. touched on a number of actions that either need Fifth, protectionist policies need to be to be taken or avoided to achieve a new sense shunned by all countries. of order in international finance. Let me con­ Sixth, countries with persistent payments clude by sketching or restating the respon­ deficits need to adopt effective domestic stabili­ sibilities, as I see them, of the major participants zation policies. in the international financial system. Seventh, non-OPEC countries experiencing First, in order to contribute to a more stable large and persistent payments surpluses also international system, the IMF must act with new need to adjust their economic policies, and they assertiveness in monitoring the economic poli­ can probably best do so by allowing some cies of its members. To give the Fund added appreciation of their exchange rates. leverage for such a role, its resources must be Eighth, all countries, and especially the enlarged. But those resources must be used United States, need to adopt stringent oil con­ sparingly and dispensed only when applicant servation policies and, wherever possible, to countries agree to pursue effective stabilization speed the development of new sources of en­ policies. In view of the clear need for better ergy. financial discipline around the world, this would Ninth, the members of OPEC must avoid a be a poor time for a new allocation of special new round of oil-price increases. They also need drawing rights—or, in plain language, printing to play an increasingly constructive role in as­ up new international money. sisting the less-developed countries and in the Second, national governments must encour­ evolution of the international financial system. age and support the IMF, so that it can become Observance of these do’s and don’ts would an effective guardian of evolving law in the go a significant distance, in my judgment, in international monetary sphere. Governments meeting the formidable challenges that now need to resist the temptation to circumvent the confront us. But we shall undoubtedly need to Fund by seeking bilateral official loans or to be ready to improvise in the fluid and complex embarrass the Fund by exerting political pres­ area of international finance. I have no illusions sure on Fund officials. Commercial and invest­ that the ideas that I have presented here tonight ment bankers also need to recognize that their can serve as a rigid blueprint. I hope, however, actions must not undercut IMF efforts to speed that they will have some value in suggesting adjustment. The IMF, in its turn, will have to directions in which governments, private equip itself to handle appropriately its new and lenders, and official institutions need to move. larger responsibilities. By working together toward a rule of law in Third, a better framework of knowledge for international finance, we shall be contributing evaluating the creditworthiness of individual to a stable prosperity for both our own citizens countries is badly needed. Among other things, and those of our trading partners. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

463 Statements to Congress Statement by Arthur F. Burns, Chairman, half of February, industrial and commercial Board of Governors of the Federal Reserve activities snapped back smartly in most parts System, before the Committee on Banking, of the country. Housing and Urban Affairs, (7.5. Senate, May Even with the adverse effects of the weather, 3, 7977. the Nation’s total production of goods and serv­ ices rose in the first quarter at about a 5 Vi per It is a pleasure to meet once again with this cent annual rate—twice the pace of the preced­ distinguished committee to present the report of ing quarter. Conditions in the labor market the Board of Governors of the Federal Reserve improved, as is evidenced by the sharp rise in System on the condition of the national econ­ hirings while layoffs remained at a low level. omy and the course of monetary policy. The unemployment rate fell by !/2 of a percent­ When we last met to discuss these subjects age point as sizable gains in employment more in November, the economy was beginning to than offset the continued rapid growth of the emerge from a period of relatively slow growth. labor force. At the same time, the rate of utili­ That fact was not widely recognized at the time. zation of our Nation’s industrial plant also edged By concentrating unduly on comprehensive higher during the first quarter and by March measures of economic activity, many people reached 82 per cent in manufacturing. failed to see the gathering momentum of posi­ In all, the recent behavior of economic activ­ tive economic forces. Then, early this year, the ity has been encouraging, and the prospects for disruptions caused by unusual weather obscured further economic advance are good. Trends in further the underlying strength of the economy. the consumer sector certainly are favorable. The It is quite apparent today, however, that a expansion of jobs and incomes during the past reacceleration of economic growth did get under half year has served powerfully to improve way late last year and that expansion is again consumer sentiment. During the final quarter of proceeding vigorously. As 1976 drew to a close, 1976 the percentage of disposable income de­ final sales of goods and services picked up, voted to consumer spending was the highest in reflecting primarily a resurgence of consumer several years, and in the first quarter of this year buying and a strong advance in homebuilding. the spending percentage rose still further. Our The improvement in sales enabled business households, viewed collectively, did not let firms to work off a good part of the excess higher fuel bills interfere with other expendi­ inventories that had accumulated over the pre­ tures. In fact, automobile sales rose to the ceding months when buying was sluggish. With highest level since 1973, as an increasing num­ sales and stocks coming into better balance, the ber of consumers displayed a willingness to pace of new orders and production began to incur additional instalment debt in order to fi­ quicken. The demand for labor strengthened, nance the purchase of big-ticket items. and personal income expanded more rapidly. The strong pace of consumer buying late in The inclement winter weather and shortages 1976 caused inventories to fall below desired in fuel supplies disrupted this expansionary levels in many lines of activity. More recently, process only briefly, and not nearly so severely inventory investment has picked up as busi­ as was suggested by early reports. As the nessmen sought to keep larger stocks to accom­ weather took a turn for the better in the second modate their customers. The increasing volume Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

464 Federal Reserve Bulletin □ May 1977 of work at manufacturing plants has had a direction may well be accelerated if the Con­ similar effect. Nevertheless, inventories gener­ gress follows through with present plans to ally remain quite lean, and inventory investment enlarge, both this year and next, the flow of can be expected to continue rising as sales move Federal grants-in-aid to States and localities. up in the months ahead. The only major component of final demand Homebuilding has also shown strength in that is not exhibiting strength at present is our recent months—especially in the single-family foreign trade balance. The dollar value of oil sector where new starts apparently reached a imports increased sharply in the first quarter record high in March. With credit readily avail­ because of the cold weather, but other im­ able and consumer confidence improving, sales ports—including coffee and other consumer of new homes were brisk even during the harsh goods—also rose substantially. Meanwhile, the winter months. Activity in the multifamily sec­ relatively slow recovery of many foreign econ­ tor, meanwhile, has recovered much more omies kept down the expansion of our exports. slowly from the depression brought on by over­ Only strength of investment income and other building in the early 1970’s. But vacancy rates nontrade items has held the over-all current-ac­ are now generally falling, and it is thus reason­ count deficit to moderate proportions. Although able to expect the construction of apartment the deterioration in our trade balance may be units to gather strength as time passes. behind us, it is hard to see significant improve­ The pace of business investment in new plant ment over the remainder of the year. and equipment, while still lagging relative to With the exception of foreign trade, however, earlier business-cycle expansions, is also gain­ demand factors generally seem to point to good ing strength. Business equipment posted the growth in our Nation’s output of goods and largest advance of any major category of indus­ services this year. Buttressing that expectation trial production during the first quarter. The is the fact that financial conditions provide a most recent surveys of business plans point to satisfactory foundation for further economic ex­ a substantial further increase in spending on pansion. plant and equipment this year. So, too, does The Federal Reserve has continued to pursue the trend of orders for business capital goods, a course of monetary policy intended to promote which have risen more than 20 per cent over conditions conducive to substantial expansion in the past year. With corporate profits improving economic activity, while guarding against the and with rates of utilization of industrial capac­ release of new inflationary forces. During the ity rising, the potential clearly exists for good past 2 years the increases that have occurred gains in business fixed investment. in the stock of money have proved adequate to Governmental demand for goods and services finance substantial gains in the physical volume also appears to be an expansive influence in the of output and employment. This experience has economy at this time. Budget estimates suggest demonstrated once again that consideration of that Federal purchases of goods and services in the stock of money alone is not sufficient for calendar 1977 will increase at a faster rate in assessment of the adequacy of the economy’s constant-dollar terms than they did last year. In liquidity. Money has a second dimension, addition, a quickening pace of spending by State namely, velocity, or—in common parlance— and local governments is likely to take place the intensity with which it is being used. Over in the months ahead. In the aggregate, State and short periods of time the truly dynamic factor local operating budgets have moved during the is not so much the stock of money as the past 2 years from deficit to surplus, thanks to willingness of the public to use their money the combination of strongly rising tax receipts balances. Upswings in business and consumer and relatively subdued expenditure growth. confidence are commonly reflected in substantial With this turnabout in their budgetary situation, increases of monetary velocity. Moreover, in State and local governments are likely to loosen the case of the narrowly defined money supply, their purse strings. And the tendency in that intensity of use has been increasing with special Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 465 rapidity since 1975, reflecting numerous inno­ of substantial issues of new long-term bonds vations in financial technology that serve to were used to repay outstanding short-term debt, reduce reliance on demand deposits for handling thus continuing a practice that has prevailed monetary transactions. since mid-1975. This process of debt restruc­ Supplies of credit have been ample—perhaps turing, together with the progress made in more than ample—during the past 6 months, strengthening budgetary positions, has im­ and most rates of interest are near their lowest proved dramatically the standing of many States levels in several years. In this environment, and municipalities with the investment commu­ many economic entities have been able to nity. Testifying to that is the fact that interest achieve a further strengthening of their financial rates on municipal securities have declined more condition. than interest rates on other fixed-income obliga­ Large business firms with high credit ratings tions. Not only that, the spread between yields issued a massive volume of long-term bonds on higher- and lower-quality bond issues has during 1975 and the first half of 1976, and they narrowed sharply in recent months. These de­ used the proceeds largely to repay short-term velopments have led to numerous advance re­ debt and to acquire liquid assets. Such restruc­ fundings of existing debt, thereby lowering the turing of balance sheets appears to have abated future interest burden on taxpayers. in the past half year or so, and many companies Despite larger loan demand from business and are now cautiously enlarging their borrowing consumers since last fall, commercial banks from banks and through the commercial paper have been able to maintain their sharply im­ market. This expansion of short- and interme­ proved liquidity. Indeed, they have added fur­ diate-term liabilities has occurred unusually late ther to their holdings of Treasury securities, in the current cyclical expansion and it has been which today are more than double what they moderate to date. were at the end of 1974. Many banks have Meanwhile, some large corporations—espe­ strengthened their equity position during the cially utility and communications firms—have past 6 months through earnings retention, and availed themselves of the attractive financing some have also augmented their capital by issu­ conditions by selling bonds to refund high ing new stock or subordinated long-term debt. coupon issues of earlier years. More important Savings banks and savings and loan associa­ still, many smaller and lower-rated firms have tions too have been able to accommodate heavy found in the past several quarters a more recep­ credit demands without reducing liquidity. The tive market for their long-term debt obligations, relatively low level of market rates of interest and they have thus been able to make progress has sustained good inflows of consumer time in strengthening their balance sheets. Life in­ and savings deposits to those institutions. surance companies and other investors in the Against this background, outstanding mortgage private placement market have been aggres­ commitments have risen to record levels and sively seeking lending opportunities and have mortgage interest rates have declined. These recently supplied a record amount of credit to developments have contributed to the brisk pace small- and medium-sized firms. Moreover, the of home sales and to the upward thrust of spread between interest rates on prime- and housing construction. lower-rated bond issues in the public market for In sum, both general financial conditions and securities—which had become unusually wide the growth patterns that have been unfolding in during the recent recession—has now narrowed key sectors of our economy justify considerable to dimensions that are normal for business-cycle optimism about the immediate future. Even so, expansion. there are some uncertainties in the present situ­ The favorable condition of financial markets ation that deserve serious attention. The most has been of help as well to State and local important of these relate to energy and inflation. governments during the past half year. Particu­ One of the reasons capital spending has larly in the final quarter of 1976, the proceeds lagged during this economic expansion has been Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

466 Federal Reserve Bulletin □ May 1977 a reluctance of businessmen to undertake long­ quicken and with the economy at a stage where term investment projects without a clearer view productivity gains are likely to become smaller of the future cost and availability of petro­ than they have been during the past 2 years, chemical feedstocks and various energy sources. there is no relief in sight for the underlying cost The President’s proposal of a broad energy pressures that businesses have been experienc­ program is a long-needed step toward creating ing. This unhappy circumstance inevitably casts a more certain environment for decision-mak- a cloud on our Nation’s ability to maintain a ing. However, with congressional action still to satisfactory rate of economic growth into 1978 be taken and with the final shape of any program and beyond. unknown, the situation at the moment is as Experience teaches that when serious infla­ uncertain as ever. Furthermore, in view of the tion persists, consumer confidence and purchas­ prospect of significant tax of other incentives ing power will ultimately erode. Continuing or disincentives in the not too distant future, inflation at high rates likewise tends to work there will be a tendency here and there to hold against sustained expansion in business invest­ off on major expenditures a bit longer to see ment activity, for it raises the risk premium that what develops. This could have the effect of businessmen attach to new undertakings. For­ retarding the advance not only of business capi­ ward business planning becomes more hesitant tal outlays in the months ahead but also of in an environment in which managers are unable spending by households—especially on auto­ to assess cost and profit prospects with any mobiles and energy-saving home improve­ confidence over the long time horizons that are ments. frequently involved in new investment projects. Because of these possibilities, it obviously is Recognizing these difficulties, President important that the Congress lose no time in Carter has outlined a multifaceted program to considering the President’s energy recom­ fight inflation. I want to assure this committee mendations. I fully realize the practical ob­ that the members of the Federal Reserve Board stacles to quick action in matters so complex, fully support the President’s determination to but I also feel bound to observe that significant bring down the rate of inflation. All of the risks to economic performance will exist as long measures in his projected program can be help­ as businessmen and the general public remain ful, but there is no doubt in our minds that the uncertain of what to expect in the energy area. main key to success in the battle against infla­ The course of economic expansion may also tion is prudent management of the Nation’s be significantly affected by the pace of inflation. finances. Inflation has accelerated in recent months. Both The Federal Open Market Committee was wholesale and consumer prices advanced at an well aware of its heavy responsibility to en­ annual rate of about 10 per cent in the first courage economic expansion and yet help to quarter, with the flare-up of food prices only curb inflation when it met last month to discuss part of the explanation. Particularly worrisome the longer-run growth of the monetary aggre­ is the fact that we have now experienced three gates. The Committee decided to leave un­ successive quarters of increase at about an 8 changed over the year ending in the first quarter per cent annual rate in the critically important of 1978 the previous growth range of 4Vi to industrial commodities component of the 6V2 per cent in M-l, which is a monetary wholesale price index. This development re­ measure confined to currency and demand de­ flects an upward climb during the past year of posits. For M-2, and likewise for M-3, the upper close to 6 per cent in the labor cost per unit boundary of the growth range was reduced, of output for private business firms; it also however, by Vi of a percentage point. Conse­ reflects an effort on the part of many companies quently, the growth ranges projected for the to widen profit margins from the low level to coming year are 7 to 9V2 per cent for M-2 and which they had fallen during the recession. With 8V2 to 11 per cent for M-3. As the committee wage increases now showing some tendency to may recall, M-2 includes savings and con­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 467 sumer-type time deposits at commercial banks constitute a growing proportion of the money besides currency and demand deposits, while stock—have often been on the mark, on occa­ M-3 is a still more comprehensive aggregate— sions there have been significant errors. Our since it also includes the deposits at savings most recent benchmark revision of M-1, based banks, savings and loan associations, and credit on nonmember bank data from the call report unions. for last September, raised the estimate of growth As you can see, the Federal Open Market over the year ended in the fourth quarter of 1976 Committee has again moved very cautiously in from 5.4 to 5.7 per cent; and this figure is still adjusting the projected monetary growth ranges. subject to subsequent revision on the basis of In addition to taking account of the usual un­ the call report for December. certainties about the relationship between We at the Federal Reserve are diligently try­ money and economic activity, we recognized ing to improve the quality of the Nation’s mon­ that the impact of the as yet unsettled energy etary data. Last year a committee of distin­ program on aggregate supply and demand in the guished economists, whose aid we had sought, period ahead cannot be foreseen with any preci­ completed a study of the statistics on monetary sion. Nonetheless, we did feel it appropriate to aggregates. Some of the recommendations of take another small step toward bringing the the committee are being implemented with the long-run growth of the monetary aggregates aid of the Federal Deposit Insurance Corpora­ down to rates compatible with general price tion. Other recommendations of the consultant stability. committee are being studied by our staff, and Sustained progress in this direction will, I further changes are likely to be instituted in the believe, be absolutely necessary if President near future. Nevertheless, experience suggests Carter’s publicly announced goal of reducing that monetary measurement will continue to lack the pace of inflation by 2 percentage points by the precision of science, and so too will the the end of 1979 is to be achieved. The trend Federal Reserve’s actions aiming to influence of growth in monetary aggregates is still rapid, developments in financial markets. perhaps much too rapid. To be sure, the Federal Events during the past several months have Reserve has moved fairly steadily toward lower again demonstrated quite clearly that the twists ranges for monetary expansion during the past and turns that occur in financial markets often 2 years. But that movement has been extremely are dominated by developments unrelated to gradual; indeed, at the current pace it would Federal Reserve actions. For instance, from late require nearly a decade to reach rates of growth in 1976 to late April, the Federal funds rate—the that are consistent with a stable price level. one interest rate over which the Federal Reserve I must report, moreover, that despite the has close control—traded within a narrow range gradual reduction of projected growth ranges for between 45/s per cent and 43A per cent; yet, other the aggregates during the past 2 years, no market rates of interest in that period fluctuated meaningful reduction has as yet occurred in over ranges as wide as a full percentage point. actual growth rates. That unintended conse­ Those fluctuations in interest rates in large part quence is partly the result of data deficiencies reflected changing public perceptions of the that complicate the already formidable task of outlook for the Federal budget. Thus, interest adjusting or approximating monetary growth rates moved upward sharply when the adminis­ objectives. Initial estimates of the monetary tration proposed a new fiscal policy, including aggregates sometimes differ considerably from the so-called rebate program; and they fell estimates made later when fuller data became markedly when the President announced that he available. had dropped the rebate plan. A factor contributing to the measurement What this demonstrates anew is that financial problem has been the inadequacy of deposit data market participants have become acutely aware for nonmember commercial banks. While our of the inflationary pressures created by Federal estimates of nonmember bank deposits—which budget deficits and the resultant adverse impact Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

468 Federal Reserve Bulletin □ May 1977 on credit conditions. The caution of the Con­ the courage or the patience to stay long enough gress with respect to the tax rebate proposal and on a monetary and fiscal path that will lead to the President’s willingness to adjust his fiscal noninflationary economic growth. We cannot program in light of emerging economic devel­ afford to backslide once again. Unless we opments have done much to enhance confidence achieve a less inflationary environment, there that our Government is moving toward a more will be little chance of sustaining the expansion responsible financial posture. that is now in progress or of significantly reduc­ In concluding this morning, I am obliged to ing the high level of unemployment that is observe that we have still a considerable dis­ blighting the lives of millions of Americans. tance to go in putting our financial house in That, in a sentence, is the Board’s central mes­ order. Too often in the past, we have lacked sage to the Congress. □ Statement by David M. Lilly, Member, Board ber of the Board of Directors of the Federal of Governors of the Federal Reserve System, Reserve Bank of Minneapolis. before the Subcommittee on Employee Ethics During my 5 years on the Bank’s Board—2 and Utilization of the Committee on Post Office years as Deputy Chairman and 3 years as and Civil Service, U.S. House of Repre­ Chairman—I endeavored to familiarize myself sentatives, May 4, 1977. with System goals, responsibilities, and objec­ tives. At that time, my perspective was that of I appreciate the opportunity to appear before this a System director encountering the operating subcommittee to express the support of the problems and responsibilities of a Reserve Board of Governors of the Federal Reserve Bank. In my present capacity as a Member of System for H.R. 2387—a bill that would raise the Board of Governors, I am required, in to Level I of the Executive Schedule the posi­ association with my colleagues on the Board, tions of the Chairman of the Board of Governors to deal with issues in the field of monetary and of the Director of the Office of Management policy, international finance, bank regulatory and Budget, and to Level II the positions of issues, and consumer protection. This experi­ the Board Members and the Deputy Director of ence enables me, I believe, to appraise the im­ the Office of Management and Budget. portance of the Board’s responsibilities regard­ Let me state at the outset my recognition that ing the stability of this Nation’s economic and an appearance before a subcommittee by an banking systems and the corresponding justifi­ individual who is a principal beneficiary of cation for moving the positions of the Chairman proposed legislation could possibly raise a and Board Members to higher levels within the question of objectivity. I am serving as a Mem­ Executive Schedule. The fact that I have re­ ber of the Board through January 31, 1978, cently transferred from a higher-paying busi­ having commenced service on June 1, 1976, ness career to an Executive Schedule, Level III after appointment to the unexpired portion of position as a Member of the Board of Gover­ a 14-year term of office. As a consequence I nors perhaps lends a degree of emphasis to have little to gain from the proposed legislation. many of the comments that I will make re­ However, my appearance before this subcom­ garding the proposed adjustment to the Execu­ mittee can, I believe, provide you with an tive Schedule. informed viewpoint on issues related to the Let me now address the issue under consid­ legislation being considered, since my back­ eration by this committee; namely, the merits ground includes not only membership on the of the Executive Schedule levels proposed by Board of Governors but also service as a mem­ H.R. 2387, with emphasis on the positions of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 469 the Chairman and Members of the Board of Board Members were raised, respectively, to Governors. A decision in this regard requires $20,500 and $20,000 per annum; but in the an historical review of past actions affecting same year, the pay level of Cabinet officers was Board Members’ salaries, as well as a brief raised to $25,000 per annum. outline of the nature and expanding scope of In 1962 President John F. Kennedy recom­ Board Member duties. mended that “the salary of the Chairman be There is clear historical evidence that these fixed at $25,000, equal to that of Department considerations have been uppermost in the mind heads, and that the salary of other Governors of the Congress when similar legislation in­ be fixed at $22,000.” In a special message to volving levels of Board Members’ compensa­ Congress on April 17, 1962, President Kennedy tion has been considered. For example, in the said in support of his recommendation: 1913 Federal Reserve Act originally establish­ The Board of Governors has immense ing the Board, the Congress recognized the responsibilities for the health of the United importance of the new agency’s responsibilities States economy. The performance of its by providing compensation for Board Members tasks requires specialized knowledge and good judgment in exceedingly complex at a level equal to that of Cabinet officers, which fields of domestic and international eco­ at that time was $12,000 per annum. This nomics and finance. The salaries of the equality prevailed until 1925, when the salaries Governors should be commensurate with of Cabinet officers were increased to $15,000 their grave responsibilities, sufficient to without a similar increase for Board Members. attract outstanding men and to give them the prestige and status necessary for ef­ However, in the Banking Act of 1935, com­ fective performance of their duties. As I pensation of Board Members was increased to said in my Economic Report, “The United $15,000, thus re-establishing the parity that was States is behind other countries in the contemplated by the original Federal Reserve status accorded, by this concrete symbol, Act. to the leadership of its ‘central bank,’ and I urge that the Congress take corrective In 1949 Cabinet officers’ compensation was action.” increased from $15,000 to $22,500 per annum. At the same time, compensation of Board In 1964 the Executive Pay Schedule was Members, including the Chairman, was raised established, with the Chairman of the Board from $15,000 to $16,000 per annum. placed in Level II and the Board Members In 1950 a Subcommittee of the Joint Com­ placed in Level III. The positions currently mittee on the Economic Report stated that remain at these levels, still below that of Cabinet “every effort should be made to build up the officers. quality and prestige of Federal Reserve I believe that the original concept of Execu­ officials,” and recommended that the salary of tive Pay Schedule parity between Board Mem­ the Chairman of the Board be raised to Cabinet bers and Members of the Cabinet was a sound officer level (then $22,500) and that the salaries one. Over the years this equality of compensa­ of other Board Members be increased to $20,- tion has been lost, although there have been 000 per annum. In 1952 this judgment of the frequent calls for correction of the discrepancy, importance of an appropriate salary base was particularly with respect to the Chairman’s sal­ reaffirmed by another subcommittee of the Joint ary. The December 1976 Report of the Com­ Committee on the Economic Report. That sub­ mission on Executive, Legislative and Judicial committee’s report stated “. . . it is of great Salaries, which was submitted to President importance that the Chairman and Members of Ford, concluded that “a significant number of the Board of Governors should be persons of Federal Government jobs, both in the super the highest caliber.” The subcommittee then grades and Executive Levels, are evaluated er­ repeated the 1950 salary recommendations for roneously,” and cited as examples of “the the Chairman and Board Members. classification problems,” the Level II classifi­ In 1956 the salaries of the Chairman and cations of the Chairman of the Federal Reserve Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

470 Federal Reserve Bulletin □ May 1977 Board and the Director of the Office of Man­ on time and savings deposits. The foregoing agement and Budget. With respect to the office responsibilities are of an imperative and unique of the Federal Reserve Board Chairman, the nature. Commission’s Report concluded: One indication of the weight of Board re­ sponsibilities is the fact that as of year-end By any standard, the Chairman of the 1976, Federal Reserve System assets totaled Federal Reserve Board has responsibilities $133.4 billion. Government securities in the that one could argue are roughly equiva­ lent to the Secretary of the Treasury. His System’s portfolio at year-end 1976 totaled position has many aspects of a career $105 billion and produced 1976 total income job—given the fourteen year tenure. Thus, of $6.5 billion. Ninety-eight per cent of the net it does not offer the prospect of a short System earnings, or $5.9 billion, was turned government career. over to the Treasury by the System at year-end I submit that the broad range of responsibilities 1976. faced by the Board, particularly as those duties A second responsibility of the Federal Re­ have increased in recent years, offers ample serve System is that of banker for the Federal justification for the Executive Schedule adjust­ Government. In this capacity, the Federal Re­ ments contemplated for the Chairman and Board serve issues, redeems, and exchanges Govern­ Members in the bill before you. ment securities; handles a major portion of the The foremost responsibility of the Federal Government’s cash balances; and, as fiscal Reserve is the formulation and implementation agent of the Federal Government, processes and of monetary policy that will ensure a sufficient handles tax payments and food stamps. More availability of money and credit to facilitate the than 2 billion food stamps were processed by achievement of a rising standard of living within the Federal Reserve System in 1976—a 58.2 the United States. Toward that end, the Federal per cent increase over the 1970 level. Reserve seeks to combat inflationary pressures, The Federal Reserve, in close and continuous which have plagued the country in past years, consultation and cooperation with the U.S. while providing the financial basis for growing Treasury, engages in foreign currency opera­ employment and output. The Federal Reserve tions, for the most part to counter disorderly has the additional responsibility, as a lender of conditions in foreign exchange markets. Such last resort, to forestall national liquidity crises foreign currency transactions are the respon­ and financial panics. General monetary policy sibility of the Federal Open Market Committee, is carried out through the coordinated use of acting through its Special Manager at the Fed­ open market operations, the regulation of mem­ eral Reserve Bank of New York. ber bank discounting with the Federal Reserve By statute, the Federal Reserve has a general Banks, and changes in member bank reserve regulatory and supervisory responsibility over requirements. The latter two activities are exer­ all member banks. As of June 30, 1976, there cised pursuant to the direction or approval of were approximately 5,800 member commercial the Board. banks in the Federal Reserve System, holding System open market operations (with trans­ $586 billion of deposits. The Federal Reserve actions in Government securities last year is responsible for examining about 1,000 State averaging about $2.0 billion per day, with a member banks and, as to any unsatisfactory single day’s high of $9.0 billion) are achieved conditions found to exist with respect to such under the direction of the Federal Open Market banks, for effecting appropriate corrective ac­ Committee, which is composed of the seven tion. In recent years, correction of unsafe or Members of the Board and five Presidents of unsound banking practices has involved the Reserve Banks. In addition, the Board deter­ Federal Reserve System, under the Board’s di­ mines the margin requirements applicable to rection, in an increasing number of cease-andstock market credit transactions and sets the desist proceedings under the Financial Institu­ maximum interest rates member banks may pay tions Supervisory Act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 471 The Federal Reserve System is also responsi­ to the Executive Schedule, would wish to take ble for regulation of some 1,900 registered bank into account the quantity and nature of respon­ holding companies, which control banks hold­ sibilities assigned to these positions; the extent ing roughly two-thirds of the banking deposits of discretionary judgment involved in the in the Nation. In the 14-year period, 1956 Board’s decision-making authority; and the through 1970, the System acted upon 470 bank over-all significance and impact of decisions holding company applications. Between 1971 made by the Board as a collegial body. and 1976, the number of applications increased The Executive Schedule Level assigned to the to 5,079. Chairman and Members of the Board, as is the In the field of foreign activities of domestic case with all Government officials, is indicative banks, the Federal Reserve is responsible for of the importance the Congress places on the processing applications by member banks to responsibilities it has assigned to a particular establish foreign branches and to make invest­ office or agency. It is my belief that if the ments in foreign subsidiaries. We must also responsibilities of the Chairman and Members supervise their activities on a continuing basis. of the Board were purely of a regulatory, or Assets of foreign branches of U.S. banks at enforcement nature, their present Levels would year-end 1976 totaled $180 billion, an increase be appropriate. However, Board Members of $52 billion over the 1970 level. As the have been assigned primary responsibility for operations of U.S. banks continue to expand the determination of national monetary and abroad, regulatory and supervisory respon­ credit policies. Certainly, the degree of impor­ sibilities of the Board will increase corre­ tance assigned to this function has not dimin­ spondingly. ished since 1913, when Board Members were The Federal Reserve also provides services paid at Cabinet officer level. Nor has there been to the banking system and the general public a diminution in the complex issues confronting through the issuance of currency and coin and Board Members. Rather, the increasing com­ the processing of checks. Presently, 50 million plexities of both domestic monetary policy and checks are processed daily by the System, an international finance, and the leadership role increase of 85 per cent over the 1970 level. This now performed by this Nation in international has required the establishment of 11 new re­ monetary and economic matters, has added to gional check processing facilities over the last the importance of the role played by the Chair­ 6 years. man and Board Members as this Nation’s central With the enactment of the Truth in Lending banking authority. The Congress, itself, has Act in 1968, the Federal Reserve System has evidenced its increasing attention to monetary been assigned a major new area of responsibility policy and other responsibilities of the Board in consumer credit protection. In increasing in its adoption of House Concurrent Resolution number and complexity, laws relating to some 133 and by its increasing requests for testimony aspect of consumer protection have been en­ of the Chairman and other Board Members. The acted that require the Board’s direct involve­ Chairman testified before congressional com­ ment in the issuance of regulations and inter­ mittees a total of 32 times in 1975 and 1976, pretations, consumer education activities, and and the other Members of the Board appeared enforcement procedures. In the past 3 years an additional 47 times during the same period. alone, there have been enacted the Fair Credit Only yesterday, Chairman Burns appeared be­ Billing, Equal Credit Opportunity, Consumer fore the Committee on Banking, Housing and Leasing, Home Mortgage Disclosure, Real Es­ Urban Affairs of the Senate to report on the tate Settlement Procedures, and the Federal condition of the national economy and the Trade Commission Improvement Acts. course of monetary policy. I have taken the time to spell out the Board’s To attract individuals of the highest qualifi­ major functions in the belief that this subcom­ cation to the Board and to permit the Chairman mittee, in considering the proposed adjustments and other Members of the Board to be accorded Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

472 Federal Reserve Bulletin □ May 1977 appropriate recognition status in international Level I of the Executive Schedule. I wish to financial circles, it would appear only logical add, however, a word of qualification to this to place the positions of the Chairman and Board statement. While, on each occasion that Chair­ Members at the proposed Executive Schedule man Burns has expressed himself on this sub­ Levels. This is obviously the intent of H.R. ject, he has strongly endorsed the principle of 2387 and a step that I believe is long overdue. increased salaries for the Chairman and Mem­ I might also point out a characteristic that bers of the Board, he has also stated quite distinguishes Board Member positions from clearly that he did not wish to benefit personally those of other Government officials. First, from a higher salary for the Office of Chairman. the statutory term of a Board Member is Accordingly, he has requested that any new 14 years—a period certainly constituting a salary level established for the Office of Chair­ major portion of an individual’s professional man become effective with his successor. The career. To attract an individual to Government Chairman has asked that this point of personal service for this length of time, particularly an reservation be placed on the record of this individual with acknowledged expertise in one hearing. or more of the areas of endeavor specified in My statement supporting favorable action on the Federal Reserve Act, the Congress should H.R. 2387 has stressed the substantial character compensate such individual at a realistic and and scope of responsibilities of the Chairman equitable level. I have reviewed the service and Board Members and the increase in the records of Board appointees for the 10-year volume and complexity of these responsibilities period 1966-76 and found that in that time, of in recent years. The same rationale would, in the 12 individuals appointed to the Board, my judgment, appropriately apply to the posi­ 5—all 50 years of age or younger—resigned tions of Director and Deputy Director of the prior to completion of their term of office. I am Office of Management and Budget. The respon­ convinced that a primary factor contributing to sibilities of these officials relating to preparation the early departure of these individuals was the and administration of the annual budget, for­ financial strain they faced as Board Members. mulation of the Government’s fiscal program, I would make a final observation regarding coordination of Executive Department views the treatment accorded the position of Chairman and recommendations on legislative matters, by this legislation. The Chairman’s respon­ and development of improved coordinating and sibilities as the Board’s “active executive administrative procedures within the Executive officer” (Section 10 of the Federal Reserve Department, are highly significant in nature and Act), his role as Alternate Governor to the greatly impact upon the performance of the International Monetary Fund, his position as entire Executive Branch. It would thus seem Chairman of the Federal Open Market Commit­ entirely appropriate to compensate the Director tee, and other uniquely sensitive duties he per­ at Level I of the Executive Schedule, and his forms, particularly warrant his classification at Deputy at Level II. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

473 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON MARCH 15, 1977 1. Domestic Policy Directive The information reviewed at this meeting suggested that growth in real output of goods and services in the first quarter of 1977 had increased from the pace in the fourth quarter of 1976—now indicated by revised estimates of the Commerce Department to have been at an annual rate of 2.4 per cent, compared with 3.9 per cent in the third quarter and 4.5 per cent in the second. The rise in average prices—as measured by the fixed-weighted index for gross domestic business product—appeared to have been faster than the annual rate of 4.9 per cent estimated for the fourth quarter of last year, in part because of the adverse effects of severe winter weather on prices of foods. Staff projections suggested that real GNP would grow at a considerably better rate in the current quarter than had appeared likely a month earlier. The rate of inventory investment—which had fallen sharply in the fourth quarter of 1976, according to the revised estimates^—was now expected to increase, whereas a month earlier it had been projected to decline further. Moreover, the gain in business fixed investment was now anticipated to be larger. On the other hand, the new projections suggested less growth in residential construction and in government purchases of goods and services. The staff projections for subsequent quarters, like those of a month earlier, incorporated assumptions that rebates of Federal income taxes and one-time payments to recipients of social security would be disbursed in the second quarter; that both personal income taxes and corporate taxes would be reduced; and that Federal spending for job-creating programs would be expanded. Reflecting these assumptions as well as expectations of continuing recovery from the effects of the severe weather, real GNP was projected Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

474 Federal Reserve Bulletin □ May 1977 to grow at a rapid rate in the second quarter and at a more moderate—but still rather substantial—pace in succeeding quarters. It was expected that the fixed-weighted price index for gross business product would rise less rapidly than in the first quarter. During February economic activity rebounded following the disruptions caused by the severe winter weather and shortages of natural gas. The index of industrial production for the month as a whole rose 1 per cent and recovered to about the December level—reflecting widespread gains among consumer goods, busi­ ness equipment, and industrial materials. Retail sales also rebounded in February, recovering almost to the advanced level reached in December. The number of new automobiles sold was at an annual rate of about 103A million, compared with \0l/2 million in January and about 11 million in December; during those 3 months sales were higher than for any other 3-month period in the current business expansion. Payroll employment in nonfarm establishments expanded consid­ erably further in February, even though plant shutdowns and energy-related layoffs were still numerous in the week ending February 12—the reference week in the month for the labor market surveys. Increases in employment were reported by three-fifths of the industries in the establishment survey. Employment in manu­ facturing was unchanged, after having expanded appreciably over the month ending in early January, but the average workweek increased much more than it had declined in January. In the household survey, the unemployment rate rose from 7.3 to 7.5 per cent, as the civilian labor force more than recovered its decrease in January; however, the rate remained below the 7.8 per cent of December. Personal income increased little in January, following 3 months of sizable gains. The slowing of growth was attributable to three main causes: a weather-related loss of wages and salaries; a drop in disbursements of corporate dividends from an unusually large December volume; and an increase in deductions for social security taxes levied on employees. For February, the labor market surveys and other information suggested a strong gain in over-all personal income. Indicators of residential construction had been strong in the closing months of 1976, but activity was curtailed in January by Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 475 the severe weather, especially in the Northeast and North Central regions of the country. In January private housing starts were more than one-fifth below the advanced average for the fourth quarter, and according to estimates of the Bureau of the Census, residential construction outlays were nearly one-tenth below the December level. At the same time, however, sales of new and existing houses remained strong, mortgage commitments outstanding at savings and loan associations at the end of January were close to the record high level of a month earlier, and through the end of 1976 rental markets continued to tighten in most areas. Businesses were planning to spend 11.7 per cent more for plant and equipment in 1977 than in 1976—according to the latest Department of Commerce survey, conducted in late January and early February. The Department’s first survey for 1977, conducted in December, had suggested a rise of 11.3 per cent. Current indicators suggested improvement in business demands for fixed capital. New orders for nondefense capital goods rose substantially more in December than had been estimated earlier, and a further modest increase was reported for January. Contract awards for commercial and industrial buildings—measured in terms of floor space—declined somewhat in January, but they were still slightly above the monthly average for the fourth quarter of 1976. The index of average hourly earnings for private nonfarm pro­ duction workers was essentially unchanged in February, after having risen sharply in January. Over the first 2 months of 1977, the index advanced at an annual rate of about 5% per cent, compared with a rise of about 7 per cent over the 12 months of 1976. The wholesale price index for all commodities rose 0.9 per cent in February, compared with an average increase of about 0.6 per cent in the preceding 5 months. Average prices of farm products and foods rose sharply in February, in part because of the effects of the cold weather on supplies of fresh fruits and vegetables and of drought on prospective supplies of grains and cotton. The price index for industrial commodities continued upward at about the average pace of recent months, reflecting mainly a sizable increase in the index for fuels and power following decreases in the preced­ ing 2 months. The advance was especially large for natural gas; because of a 2-month lag in reporting natural gas prices, the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

476 Federal Reserve Bulletin □ May 1977 February index reflected increases that had been effected last December. The consumer price index rose 0.8 per cent in January, compared with 0.4 per cent in December and also with 0.4 per cent on the average during the second half of 1976. Retail prices of foods rose substantially, even though the prices in the index were recorded early in January and did not show in full the effects of the bad weather. Among nonfood items, increases were reported for used automobiles, fuel oil, medical care services, property taxes, and water and sewage rates. The average value of the U.S. dollar against leading foreign currencies, on a trade-weighted basis, changed little over the period between the February and March meetings of the Committee, continuing the relative stability that dated from April 1976. In the latest 4-week period it appreciated against the Canadian dollar, the Italian lira, and the Swiss franc and depreciated against the Japanese yen and the currencies associated in the European “snake” arrangement. The U.S. foreign deficit increased further in January to a record rate. Exports declined a little from the rate in the fourth quarter of 1976 because shipments of coal and perhaps of other commodi­ ties were slowed by the weather, and exports of wheat were reduced by expectations of ample supplies; exports of other agricultural commodities expanded. Imports were up substantially from the fourth-quarter rate, reflecting increases for iron and steel products and a number of finished industrial products. Imports of foods also expanded, owing to price increases for coffee and cocoa. Total credit at U.S. commercial banks rose more in February than in any other month since the summer of 1974. Acquisitions of U.S. Treasury securities were especially large, holdings of other securities rose somewhat for the first time since November, and total loans continued to expand. Business demands for short-term credit strengthened further in February, both at banks and in the commercial paper market, but business financing in the capital market slowed. Over the Jan­ uary-February period the combined total of business loans at banks (excluding bankers acceptances) and the outstanding volume of commercial paper issued by nonfinancial corporations expanded at an annual rate of about I6V2 per cent, compared with a rate of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 411 1 per cent in the fourth quarter of 1976 and a small decline over the preceding three quarters. In the most recent period, business demands for short-term credit may have been swelled temporarily by the weather-induced disruptions to production and distribution and by “bridge” financing associated with advance refundings of some high-yielding issues of corporate bonds. Growth in the narrowly defined money stock (M-l) slowed sharply to an annual rate of a little less than 1 per cent in February from the revised rate of about 5Vi per cent in January. Nevertheless, M-l had grown at an annual rate of about 5 per cent over the latest 6 months and by about 53A per cent over the past year. Expansion in M-2 and M-3 also slowed sharply in February—to annual rates of about 6Vi and S3A per cent, respectively, from rates of about 9lA and 1 PA per cent in January. In addition to the weakness of growth of M -l, flows into savings and small-denomi­ nation time deposits at both banks and nonbank thrift institutions continued to moderate. Over the 6 months ending in February, M-2 and M-3 grew at annual rates of about 11 and 13 per cent, respectively. The continuing slowdown in growth of savings and small-de­ nomination time deposits at banks and other thrift institutions was attributable in part to reductions in interest rates offered on these deposits by some institutions and to the firming of market interest rates after the turn of the year. In addition, deposit inflows may have been adversely affected by the weather-related reductions in wage and salary payments and by increases in fuel bills of house­ holds. At its February meeting the Committee had decided that growth in M-l and M-2 over the February-March period at annual rates within ranges of 3 to 7 per cent and 6V2 to IOV2 per cent, respectively, would be appropriate, and it had judged that such growth rates were likely to be associated with a weekly-average Federal funds rate in the area of 45/s to 43A per cent. The Committee also had agreed that if growth rates of the aggregates over the 2-month period appeared to be deviating significantly from the midpoints of the indicated ranges, the operational objective for the weekly-average Federal funds rate should be modified in an orderly fashion within a range of 4lA to 5 per cent. Throughout the interval since the February meeting, the Manager Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

478 Federal Reserve Bulletin □ May 1977 of the System Open Market Account had continued to aim for a Federal funds rate in the area of 4% to 43A per cent. In the early weeks of the interval, incoming data had suggested that growth in both M-l and M-2 over the February-March period would be close to the midpoints of the specified ranges. Estimates of the 2-month growth rates subsequently were revised downward, but they remained reasonably well within their specified ranges. Short-term market interest rates in general changed little during the inter-meeting period, in part because of the continued relative stability in the Federal funds rate and in part because money market participants inferred—on the basis of the behavior of the aggre­ gates—that a near-term rise in the funds rate was unlikely. How­ ever, yields on most longer-term bonds edged higher, apparently in response to signs that economic activity was rebounding from the weather-induced slowdown more vigorously than had been anticipated and also to greater apprehension about prospects for the rate of inflation engendered in part by the price indexes released during the period. In February the U.S. Government borrowed $9.1 billion of new money from the public, including $7.5 billion through auctions of marketable notes and bonds. No additional market financing occurred during the first half of March, but a 2-year note auction involving $450 million of new money had been announced for later in the month. In congressional testimony Treasury officials reported a sizable downward revision in their estimate of near-term cash needs based on evidence of a continuing substantial shortfall of Federal spending from projected levels. In the corporate bond market the volume of new securities offered publicly in February was less than half that in each of the two preceding months. Some potential issuers, particularly those with higher bond ratings, had apparently been discouraged by the Jan­ uary rise in bond yields. In addition, underwriters reported that some lesser-rated corporations were electing to place debt issues privately rather than publicly—an option that was apparently facil­ itated by the continued availability of a large supply of investable funds at life insurance companies. Offerings of new long-term State and local government securities rose to an estimated volume of about $3 billion in February—a record for the month and about 15 per cent above the volume sold Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 479 in February 1976. A significant part of this supply was attributable to the issuance of bonds in advance of refundings of issues bearing higher interest rates. To preserve the tax-exempt status of such new bonds under current Treasury regulations, many of the issuers place the proceeds in special Treasury obligations until the existing State and local issues are called. Accordingly, these financings accounted for a large proportion of the sales of nonmarketable securities by the Treasury. Yields in secondary mortgage markets increased a little during February along with bond yields, but interest rates on new com­ mitments for conventional home mortgages continued to edge down. Takedowns of mortgages by savings and loan associations slowed during January, probably due in part to the weather, but the volume was still relatively large. It appeared likely that over-all credit demands would remain strong in the period immediately ahead. The forward calendars of new issues suggested that offerings of corporate bonds would rise substantially in March from the reduced level in February and that offerings of State and local government bonds would continue to be large. In addition, the Treasury was expected to raise a sizable amount of new money during the period up to the mid-April date for payment of taxes, although a significant share of the required funds was expected to be raised through short-term instruments. It appeared likely that business demands for bank credit would remain moderately strong but that the over-all expansion in out­ standing business loans might be held down for a time by repay­ ments with proceeds from capital market financings. At its January meeting the Committee had agreed that from the fourth quarter of 1976 to the fourth quarter of 1977, average rates of growth in the monetary aggregates within the following ranges appeared to be consistent with broad economic aims: M-1, 4V2 to 6V2 per cent; M-2, 7 to 10 per cent; and M-3, 8V2 to IIV2 per cent. The associated range for growth in the bank credit proxy was 7 to 10 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. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

480 Federal Reserve Bulletin □ May 1977 In the discussion of the economic situation at this meeting, members of the Committee were in general agreement with the staff projection that real GNP would expand at a rapid rate in the second quarter of 1977 and at a more moderate, but still rather substantial, rate in subsequent quarters. However, one member expressed the opinion that the strength in the outlook derived from factors other than the expected fiscal policy measures; in his view, the stimulative effects of those measures would be largely offset over the longer run by their tendency to raise interest rates and to increase inflationary expectations. Another member reported that in some parts of the West economic prospects were viewed with pessimism as a result not only of declines in prices of some farm products and increases in farm costs but also of the severe winter and drought. One or two members expressed the belief that the behavior of real GNP during the second half might differ somewhat from that portrayed by the staff projections: specifically, expansion might be somewhat more rapid than that projected for the third quarter but then might taper off. Another member suggested that throughout the second half of the year the pace of economic activity might be stronger than projected by the staff, reflecting a larger rise in business investment in both fixed capital and inventories, stimulated in part by growing confidence in the economic outlook. Moreover, he thought that some of the shortfall in Federal expenditures that had developed in the first 2 months of 1977 might well be made up in the months ahead. Several members expressed concern about the recent and prospective behavior of prices. It was noted that over the past few months price increases had been relatively large for a number of commodities, and that the extent to which increases seemed to be spreading among industrial materials might well be intensifying upward pressures on prices of industrial products in general. More­ over, businessmen appeared to have become more concerned about inflation within the past month or so. One member noted that large increases over recent months in prices for some commodities—such as coffee, cocoa, and fuels— reflected special problems having little to do with more general influences on the behavior of prices. With respect to the influence of aggregate demand, he noted that the substantial margin of unused Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 481 capacity and the high rate of unemployment at this time should tend to limit the rate of increase in wage rates and in the broad measures of prices. It was observed during the discussion that, given the longer-run ranges for growth in the monetary aggregates adopted at the January meeting, the projected rates of increase in nominal GNP implied a rise in the income velocity of money that was large for this stage of a business expansion. In that connection it was noted that significant upward pressures on interest rates might develop later in the year, particularly if prices should rise more rapidly than projected or if inflationary expectations should strengthen. On the other hand, one member remarked that, while interest rates played a role, the predominant determinant of velocity changes was the state of confidence. On the basis of his judgment that confidence was improving, he thought it was likely that the rate of increase in velocity would be quite high. Another member observed that in almost every business expansion since World War II, the rate of increase in velocity had reached a primary peak, then dropped back before reaccelerating to a secondary peak not quite so high as the first one. As to policy for the period immediately ahead, members of the Committee did not differ greatly in their preferences for ranges of growth for the monetary aggregates over the March-April period. It was suggested that the forces that had contributed to particularly slow growth in the monetary aggregates in February might be reversed and might contribute to rapid growth in March, and that such a development should not necessarily cause concern. It was also observed that the upward momentum of economic activity in the weeks ahead would tend to expand demands for transactions balances and thus to exert some upward pressure on growth rates for the monetary aggregates. For M-l, most members favored a range of AV2 to 8V2 per cent; some sentiment was expressed for ranges of 4 to 8 per cent and 4 to 9 per cent. For M-2, most members favored a range of 7 to 11 per cent, but some preferences were expressed for 6V2 to IOV2 per cent and 6 to 10 per cent. The members in general favored directing initial operations during the coming inter-meeting interval toward the objective of maintaining the Federal funds rate in the area of 4% to 4% per cent. A few members suggested that the Federal funds rate should Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

482 Federal Reserve Bulletin □ May 1977 be permitted to drift up over coming weeks to 4% or 47s per cent even if the aggregates appeared to be growing at rates near the midpoints of their specified ranges, but the majority did not favor this course. The members also differed somewhat with respect to the degree of leeway that should be provided for System operations during the inter-meeting period in the event that growth in the aggregates appeared to be deviating significantly from the midpoints of the specified ranges. The largest number of members preferred to specify an inter-meeting range for the Federal funds rate of 4Va to 5Va per cent; a few favored retaining the range of 4Va to 5 per cent that had been specified at the preceding two meetings; and some sentiment was expressed for a range of 4V2 to 5Va per cent. At the conclusion of the discussion the Committee decided that growth in M-l and M-2 over the March-April period at annual rates within ranges of 4Vi to 8V2 per cent and 7 to 11 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-l and M-2. In the judgment of the Committee, such growth rates of the aggregates were likely to be associated with a weekly-average Federal funds rate in the area of 4% to 43/a per cent. The Committee agreed that if growth rates of the aggregates over the 2-month period appeared to be deviating significantly from the midpoints of the indicated ranges, the operational objective for the weekly-average Federal funds rate should be modified in an orderly fashion within a range of 4Va to 5Va per cent. 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 has increased in the current quarter from the reduced pace in the fourth quarter of 1976. In February industrial output and retail sales expanded substantially after being held down for a time by the effects of unusually severe Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 483 weather. Employment rose considerably further; the unemployment rate increased somewhat to 7.5 per cent—as the labor force more than recovered the decline of January—but it remained below the 7.8 per cent of December. The wholesale price index for all commodities rose substantially in February, reflecting large increases for farm products and foods and for fuels and power. The index of average wage rates rose more moderately over the first 2 months of 1977 than it had on the average during 1976. The average value of the dollar against leading foreign currencies has changed little over the past month. In January the U.S. foreign trade deficit increased further; exports were down a little from the fourth-quarter rate and imports were substantially higher. Growth in M-1 slowed sharply in February from the moderate pace in January. At banks and thrift institutions, inflows of time and savings deposits other than large-denomination CD’s continued to slacken. Business demands for short-term credit appear to have strengthened further in early 1977. Since mid-February short-term market interest rates have changed little on balance, but most longer-term rates have edged higher. In light of the foregoing developments, it is the policy of the Federal Open Market Committee to foster bank reserve and other financial conditions that will encourage continued economic expan­ sion, while resisting inflationary pressures and contributing to a sustainable pattern of international transactions. At its meeting on January 18, 1977, the Committee agreed that growth of M-1, M-2, and M-3 within ranges of AV2 to 6V2 per cent, 7 to 10 per cent, and 8V2 to IIV2 per cent, respectively, from the fourth quarter of 1976 to the fourth quarter of 1977 appears to be consistent with these objectives. These ranges are subject to reconsideration at any time as conditions warrant. The Committee seeks to encourage near-term rates of growth in M-1 and M-2 on a path believed to be reasonably consistent with the longer-run ranges for monetary aggregates cited in the preceding paragraph. Specifically, at present, it expects the annual growth rates over the March-April period to be within the ranges of AV2 to 8V2 per cent for M-1 and 7 to 11 per cent for M-2. In the judgment of the Committee such growth rates are likely to be associated with a weekly-average Federal funds rate of about 4% to 43A per cent. If, giving approximately equal weight to M-1 and M-2, it appears that growth rates over the 2-month period will deviate significantly from the midpoints of the indicated ranges, the operational objective for the Federal funds rate shall be modified in an orderly fashion within a range of AlA to 5Va per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

484 Federal Reserve Bulletin □ May 1977 If it appears during the period before the next meeting that the operating constraints specified above are proving to be significantly inconsistent, the Manager is promptly to notify the Chairman who will then decide whether the situation calls for supplementary instructions from the Committee. Votes for this action: Messrs. Burns, Volcker, Coldwell, Gardner, Guffey, Jackson, Lilly, Mayo, Morris, Partee, Roos, and Wallich. Votes against this action: None. 2. Authorization for Domestic Open Market Operations At this meeting the Committee amended, effective immediately, paragraph 1(b) of the authorization for domestic open market operations, relating to outright purchases and sales of bankers acceptances. The words “when appropriate” were added at the beginning of the paragraph and the dollar limit on holdings of bankers acceptances specified at the end of the paragraph was reduced from $1 billion to $100 million. As amended, paragraph 1(b) read as follows: (b) When appropriate, to buy or sell in the open market, from or to acceptance dealers and foreign accounts maintained at the Federal Reserve Bank of New York, on a cash, regular, or deferred delivery basis, for the account of the Federal Reserve Bank of New York at market discount rates, prime bankers acceptances with maturities of up to nine months at the time of acceptance that (1) arise out of the current shipment of goods between countries or within the United States, or (2) arise out of the storage within the United States of goods under contract of sale or expected to move into the channels of trade within a reasonable time and that are secured throughout their life by a warehouse receipt or similar document conveying title to the underlying goods; provided that the aggregate amount of bankers acceptances held at any one time shall not exceed $100 million; Votes for this action: Messrs. Burns, Volcker, Coldwell, Gardner, Guffey, Jackson, Lilly, Mayo, Morris, Partee, Roos, and Wallich. Votes against this action: None. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 485 This action reflected a decision by the Committee that the System should permit its existing holdings of bankers acceptances to mature and that it should no longer purchase these instruments outright under ordinary circumstances. It was noted that present System holdings were in excess of the newly established limit of $100 million, but it was anticipated that maturities within the next 2 months would reduce holdings below that level. The Committee also agreed that the Federal Reserve should remain an active participant in the market for bankers acceptances by continuing to make with dealers repurchase agreements that are secured by bankers acceptances and by continuing to serve as agent in buying and selling acceptances for the accounts of foreign central banks. In taking this action, the Committee noted that the market for bankers acceptances was well developed and efficient and no longer in need of support through Federal Reserve participation. Also, outright purchases and sales of acceptances had not been of sufficient size to contribute materially to the needed volume of open market operations in recent years. However, repurchase agreements in acceptances had been a useful tool in meeting short-term needs for bank reserves. 3. Review of Continuing Authorizations This being the first meeting of the Federal Open Market Committee following the election of new members from the Federal Reserve Banks to serve for the year beginning March 1, 1977, the Commit­ tee followed its customary practice of reviewing all of its continuing authorizations and directives. The Committee reaffirmed the para­ graphs of the authorization for domestic open market operations not affected by the preceding action, the authorization for foreign currency operations, and the foreign currency directive, in the forms in which they were presently outstanding. The Committee also reaffirmed the procedural instructions with respect to proposed or ongoing operations under the foreign currency documents and the special authorization relating to System obligations in Swiss francs, in the forms adopted effective December 28, 1976. Votes for these actions: Messrs. Burns, Volcker, Coldwell, Gardner, Guffey, Jackson, Lilly, Mayo, Morris, Partee, Roos, and Wallich. Votes against these actions: None. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

486 Federal Reserve Bulletin □ May 1977 In reviewing the authorization for domestic open market opera­ tions, the Committee took special note of paragraph 3, which authorizes the Reserve Banks to engage in the lending of U.S. Government securities held in the System Open Market Account under such instructions as the Committee might specify from time to time. That paragraph had been added to the authorization on October 7, 1969, on the basis of a judgment by the Committee that in the existing circumstances such lending of securities was reasonably necessary to the effective conduct of open market operations and to the effectuation of open market policies, and on the understanding that the authorization would be reviewed periodically. At this meeting the Committee concurred in the judgment of the Manager that the lending activity in question remained reasonably necessary and that, accordingly, the authori­ zation should remain in effect subject to periodic review. 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

487 Law Department Statutes, regulations, interpretations, and decisions MEMBERSHIP OF prescribed by the Secretary, to finance nonresi­ STATE BANKING INSTITUTIONS dential additions or improvements to be used IN THE FEDERAL RESERVE SYSTEM solely for agricultural purposes on a farm. The Board of Governors has amended its Regu­ * * * * * lation H to implement the exemptive provisions provided in Public Law 94-375 concerning certain real loans made by State member banks in identi­ CREDIT BY BROKERS AND DEALERS fied flood hazard areas of communities that are not The Board of Governors has amended its Regu­ participating in the National Flood Insurance pro­ lation T to (1) relax a rule to permit a put and gram. a call on the same underlying security but with Effective April 13, 1977, the last sentence of different exercise prices and different expiration section 208.8(e)(5) of Regulation H is amended dates to be combined for special margin treatment by deleting the language that follows . . Pro­ in the same manner as a “straddle” (a put and vided,” and adding the following: a call with identical terms) and (2) delete a refer­ ence in the existing “straddle” rule to the special Section 208.8—Banking Practices bond account and the special convertible debt security account as it is impractical to use these accounts for the described transaction. Effective June 1, 1977, section 220.3(i) is (e) LOANS BY STATE MEMBER BANKS IN IDEN­ amended as follows: TIFIED FLOOD HAZARD AREAS. Section 220.3—General Account (5) . . . that the prohibition contained in this section shall not apply to (i) any loan made to * * * * * finance the acquisition of a residential dwelling occupied as a residence prior to March 1, 1976, or one year following identification of the area (i) OPTIONS. (4) When both a put and a call are issued, within which such dwelling is located as an area endorsed or guaranteed in a general account on containing special flood hazards, whichever is the same number of shares of the same underlying later, or made to extend, renew, or increase the security, the amount of margin required shall be financing in connection with such a dwelling, (ii) the margin on either the put or the call, whichever any loan, which does not exceed an amount pre­ is greater, plus any unrealized loss on the other scribed by the Secretary of Housing and Urban option. Development, to finance the acquisition of a building or structure completed and occupied by a small business concern, as defined by the Secre­ tary, prior to January 1, 1976, (iii) any loan or INTERPRETATIONS OF REGULATION B loans, which in the aggregate do not exceed $5,- 000, to finance improvements to or rehabilitation California law requiring delivery of notices to of a building or structure occupied as a residence unmarried co-signers is not inconsistent with prior to January 1, 1976, or (iv) any loan or loans, Equal Credit Opportunity Act. The Board has been which in the aggregate do not exceed an amount asked to determine whether certain provisions of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

488 Federal Reserve Bulletin □ May 1977 the California Civil Code are inconsistent with the the State law prohibits delivery of a notice required Federal Equal Credit Opportunity Act (the ECOA) by the Act or Regulation B. and Regulation B. The ECOA preempts those Accordingly, the Board had determined that §§ State laws that are inconsistent with it, unless the 1799.90-1799.96 of the California Civil Code re­ State law provides greater protection to the appli­ quiring notifications for co-signers are not incon­ cant. Section 202.11(b)(1) of Regulation B further sistent with Regulation B. Creditors will not vio­ defines the statutory preemption standard by listing late the Equal Credit Opportunity Act or Regula­ five types of State law that are deemed inconsistent tion B by complying with this State law. and less protective of an applicant. The Board had California law requiring Spanish translation of determined, as more fully discussed below, that credit documents is not inconsistent with Equal the notification and Spanish-language translation Credit Opportunity Act. California Civil Code § requirements of §§ 1799.90-1799.96 and 1632 of 1632 generally requires that any person who ne­ the California Civil Code are not inconsistent with gotiates primarily in the Spanish language orally the Act and Regulation B. or in writing in the course of entering into certain California Civil Code §§ 1799.90-1799.96 re­ transactions, including some consumer credit con­ quire that whenever more than one person signs tracts, must display a Spanish-language notice a consumer credit contract, each signer must re­ advising customers that they may request an un­ ceive a notice explaining the obligations imposed executed Spanish-language contract or agreement. by the contract as well as a copy of all documents Section 1799.91 requires that where the notice to affecting the obligations to be undertaken. If the co-signers, discussed above, is required, a Spanish signers are married to each other, however, no translation of the notice must also be provided. notice need be delivered. The Board has been asked to determine whether Section 202.11 (b)( 1 )(i) of Regulation B pro­ the State law, by requiring creditors to give pref­ vides that if a State law . . requires or permits erential treatment to Spanish-speaking credit ap­ a practice or act prohibited by the Act or [Regula­ plicants, requires discrimination against other tion B],” it is preempted. In order to determine credit applicants on the basis of their national whether favoring unmarried applicants over mar­ origin, and, therefore, is preempted by § ried applicants when delivering notices is a prac­ 202.11 (b)( 1 )(i) of Regulation B. tice intended to be prohibited by the ECOA, the The judgment must be made whether a transla­ scope and purpose of the Act must be identified. tion requirement benefitting only one national The Act forbids discrimination in the granting group frustrates the intent of the Federal Act and of credit on several bases, but marital status is regulation; that is, whether affording special pro­ the only prohibited basis relevant to this discus­ tection to one group adversely affects the credit­ sion. The purpose of the Act as stated in § 502 worthiness of other groups or makes credit less is: available to them. The Board has determined that in the case of §§ 1632 and 1799.91 of the Califor­ ... to require that financial institutions and other firms engaged in the extension of credit nia Civil Code, it does not. make that credit equally available to all The right to obtain a translation of documents credit-worthy customers without regard to relating to a consumer credit transaction does not . . . marital status. affect an applicant’s creditworthiness nor does it Although the State law in question clearly dis­ make credit more readily available. It aids con­ criminates on the basis of marital status by requir­ sumers in understanding the obligation they are ing protections for unmarried co-signers not re­ about to incur. The Federal Equal Credit Opportu­ quired for married ones, the Board has determined nity Act requires that creditors apply their stand­ that the discrimination is not the type prohibited ards of creditworthiness in a uniform manner by the Act because the State law does not inhibit without regard to national origin. A State require­ the equal availability of credit to all creditworthy ment that contract terms be made more easily customers. The Board believes that a law requiring understandable for one group is therefore not in­ the delivery of a notice affects neither the avail­ consistent with the Act and Regulation B. Credi­ ability of credit nor the creditworthiness of the tors may comply with the notification and transla­ applicant to the extent that would render it incon­ tion requirements imposed by §§ 1632 and sistent with the Act and Regulation B, unless: (1) 1799.91 of the California Civil Code without vio­ the notice conveys information that is inconsistent lating Regulation B. with the intent of the Act or Regulation B; or (2) This interpretation should not be construed to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 489 condone a refusal to negotiate with certain groups BANK HOLDING COMPANIES or the discouraging of their applications because Deferral of Rulemaking Proposal they are afforded special protection by State law. Such a practice may violate the Act and regulation. The Board of Governors on August 2, 1976, proposed an amendment to its Regulation Y (12 CFR § 225) that would add the activities of pro­ INTEREST ON DEPOSITS viding management consulting advice to The Board of Governors has amended its Regu­ nonaffiliated savings banks and possibly to other lation Q to establish a new category of time deposit nonaffiliated, depositary-type financial institutions for IRA and Keogh funds deposited with member to the list of activities that the Board has previously banks. The rule permits member banks to pay determined to be permissible for bank holding interest on funds with a maturity of three years companies, as specified in § 225.4(a) of Regula­ or longer deposited pursuant to IRA and Keogh tion Y. Notice of the proposed amendment was Plans established with the bank at a rate of up published in the Federal Register on August 9, to 7.75 per cent. 1976 (41 Fed. Reg. 33306 (1976)). The amend­ Effective July 6, 1977, section 217.7 is ments were proposed in connection with an appli­ amended as follows: cation by Worcester Bancorp, Inc., Worcester, Massachusetts, pursuant to § 4(c)(8) of the Bank Holding Company Act (12 U.S.C. § 1843(c)(8)) Section 217.7— and § 225.4 of the Board’s Regulation Y (12 CFR Maximum Rates of 225.4), for prior approval to engage de novo in Interest Payable by Member providing management consulting advice to Banks on Time and Savings Deposits nonaffiliated savings banks. By letter of March 3, 1977, to the Federal ^ Reserve Bank of Boston, Worcester Bancorp, Inc. has withdrawn its application to engage in provid­ (b) TIME DEPOSITS OF LESS THAN $100,000. ing management consulting advice to nonaffiliated (1) Except as provided in paragraphs (a), (d), and savings banks. In accord with its general policy, (e) and subparts 2 and 3 of this paragraph, no the Board, in the absence of a specific bank hold­ member bank shall pay interest on any time deposit ing company proposal, has determined to defer at a rate in excess of the applicable rate under further consideration of the proposed activity, and the following schedule: hereby suspends the rulemaking proceeding ini­ tiated on August 2, 1976. (e) INDIVIDUAL RETIREMENT ACCOUNT AND KEOGH (H.R. 10) PLAN DEPOSITS OF LESS THAN $100,000. Except as provided in paragraph (a), a member bank may pay interest on any time deposit TRUTH IN LENDING with a maturity of three years or more that consists The Board of Governors has amended its Regu­ of funds deposited to the credit of, or in which lation Z to require creditors to make certain addi­ the entire beneficial interest is held by, an individ­ tional disclosures when variable interest rate ual pursuant to an Individual Retirement Account clauses are used in credit transactions. It requires agreement or Keogh (H.R. 10) Plan established disclosure of the fact that the annual percentage pursuant to 26 U.S.C. (I.R.C. 1954) §§ 408, 401, rate is subject to increase, the conditions under at a rate not in excess of the highest of any of which an increase may occur, the manner in which the permissible rates that can be paid on time an increase would be effected, and in some cases, deposits under $100,000 by any Federally insured information on the effect a rate increase would commercial bank, mutual savings bank, or savings have on the payment amounts and/or maturity of and loan association.3 the obligation. Effective October 10, 1977 12 C.F.R. Part 226 is amended as follows: :,The highest permissible rate is currently 7.75 per cent per ^ ' Section 226.8(b) is amended by the addition annum (12 CFR 329.7 and 12 CFR 526.5). of subparagraph (8) as follows: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

490 Federal Reserve Bulletin □ May 1977 Section 226.8—Credit Other and (iv) need be made only in transactions in Than open End—Specific Disclosures which a security interest is taken in real property used or expected to be used as the customer’s dwelling, and they need not be made in transac­ tions primarily for agricultural purposes, transac­ (b) * * * tions in which the obligation is repayable in sub­ (8) If the annual percentage rate as disclosed stantially equal instalments which do not include under § 226.8(b)(2) is prospectively subject to repayments of principal, or transactions in which increase103, the following additional disclosures disclosures are made pursuant to § 226.814. shall be made: (i) the fact that the annual percentage rate is 2. Interpretation § 226.810, previously issued subject to increase and the conditions under which by the Board, is rescinded effective October 10, such rate may increase, including: (A) identifica­ 1977, since the amendment to § 226.8(b) of the tion of the index, if any, with respect to which Regulation makes this interpretation unnecessary. such increase in annual percentage rate is tied; and (B) any limitation on such increase; 3. The Board has also amended Regulation Z (ii) the manner(s) (such as an increase in to permit the use of Spanish rather than English payment amounts, number of scheduled periodic language Truth in Lending disclosures in the com­ payments, or in the amount due at maturity) in monwealth of Puerto Rico. English language dis­ which any increase in the annual percentage rate closures must be provided to customers if they so may be effected; request. (iii) if the obligation is repayable in substan­ Effective April 11, 1977, 12 CFR Part 226 is tially equal instalments at substantially equal in­ amended by adding a new paragraph to § 226.6(a) tervals (including those obligations providing for to read as follows: “balloon” payments) and the increase could be effected by an increase in the periodic payment Section 226.6— amount, a statement of the estimated increase in General Disclosure requirements the amount of the payment caused by a hypo­ (a) DISCLOSURES; GENERAL RULE.*** thetical immediate increase of one quarter of one All disclosures required to be given by this Part percentage point, based upon the number of shall be made in the English language except in scheduled periodic payments and original amount the Commonwealth of Puerto Rico where disclo­ financed disclosed at consummation; sures may be made in the Spanish language with (iv) if the obligation is repayable in substan­ English language disclosures provided upon the tially equal instalments at substantially equal in­ customer’s request, either in substitution for the tervals (including those obligations providing for Spanish disclosures or as additional information “balloon” payments) and the increase could be in accordance with § 226.6(c). effected by an increase in the number of periodic payments, a statement of the estimated increase in the number of periodic payments caused by a INTERPRETATIONS OF REGULATION C hypothetical immediate increase of one quarter of Treatment of Majority-Owned, Depository one percentage point, based upon the periodic Subsidiaries of Depository Institutions. The Board payment amount and the original amount financed has been asked whether a majority-owned, depos­ disclosed at consummation. itory subsidiary of a depository institution should Any increase in the annual percentage rate be treated in the same way as a non-depository within the conditions or limitations disclosed in subsidiary. The first sentence of § 203.2(c) defines accordance with this paragraph is a subsequent a depository institution as “any commercial bank, occurrence under § 226.6(g) and is not a refinanc­ savings bank, savings and loan association, build­ ing under § 226.8(j). ing and loan association, homestead association The disclosures required under § 226.8(b)(8)(iii) (including cooperative banks), or credit union, which makes Federally-related mortgage loans.” The second sentence deals with subsidiaries: “Any i°ap0r this purpose, the phrase “prospectively subject to majority-owned subsidiary of a depository institu­ increase” does not apply to increases in the annual percentage tion shall be deemed to be part of its parent rate upon such occurrences as default, acceleration, late pay­ ment, assumption or transfer of property. depository institution for the purposes of this Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 491 Part.” The purpose of the subsidiary provision is A depository institution that was exempt on to provide a more complete picture of a parent’s or after the effective date of this Part on the basis of paragraph (a) of this section and lending patterns by including information regard­ that subsequently becomes no longer exempt ing the lending activities of any non-depository, shall compile the data described in section majority-owned subsidiary. 203.4 of this Part for each fiscal year begin­ A few depository institutions, however, have ning with its last full fiscal year ending prior majority-owned subsidiaries that are themselves to the date it was no longer exempt, and that last full fiscal year shall be deemed to depository institutions. This raises the issue of how be a “full fiscal year ending prior to July a depository institution as defined in the first part 1, 1976” for the purposes of section 203.4 of § 203.2(c), which is also a majority-owned of this Part. subsidiary of a depository institution, should be treated for Regulation C disclosure purposes. If, The first point on which clarification has been absent the second part of § 203.2(c), the deposi­ sought is the meaning of the language “last full tory subsidiary otherwise would make separate fiscal year ending prior to the date it was no longer disclosures under Regulation C, then combining exempt. . . . ” For any depository institution that the subsidiary’s loan data with the parent’s into loses its exemption under § 203.3(a)(2) because a single statement would reduce public disclosure, of the re-definition of a standard metropolitan contrary to the intent of § 203.2(c) and the purpose statistical area or loses its exemption under § of the Home Mortgage Disclosure Act. 203.3(a)(3) because applicable State disclosure Therefore, to further the intent of the act and law is found not to be substantially similar to the the regulation, a parent depository institution may Federal Act, “its last full fiscal year ending prior draw a distinction for disclosure purposes between to the date it was no longer exempt” is its fiscal depository and non-depository, majority-owned year immediately preceding the fiscal year during subsidiaries. A majority-owned, non-depository which the exemption was lost. For example, a subsidiary of a depository institution should be depository institution having a calendar fiscal year treated as an integral part of its parent, with no that ceases to be exempt during 1977 would have distinction made between them for reporting pur­ to disclose relevant 1976 data. poses, in accordance with the second sentence of For any depository institution that loses its ex­ § 203.2(c). On the other hand, at the parent’s emption under § 203.3(a)(1) because its assets option, a majority-owned, depository subsidiary of exceed $10,000,000 on the final day of its last a depository institution may be treated as a dis­ fiscal year, the period to be covered by its initial tinct, unaffiliated entity since it is a depository disclosure statement is that last fiscal year. For institution as defined in the first sentence of example, a calendar fiscal year institution that has § 203.2(c). assets of more than $10,000,000 on December 31, Disclosure After Loss of Exemption. The Board 1977 would have to disclose relevant 1977 loan has been requested to clarify the Regulation C information. disclosure requirements that apply to a depository The Board also has been asked to explain the institution that ceases to be exempt from the Home significance of the phrase “ ‘full fiscal year ending Mortgage Disclosure Act. prior to July 1, 1976. . . .’” The purpose in § Section 203.3(a) of Regulation C describes the 203.3(b) of equating an institution’s “last full three classes of depository institutions that are fiscal year ending prior to the date it was no longer exempt from the regulation’s disclosure require­ exempt” with a “ ‘full fiscal year ending prior to ments. They are: (1) institutions that have assets July 1, 1976’ ” is to make available to an institu­ of $10,000,000 or less as of the last day of their tion that loses its exemption the same disclosure fiscal year; (2) institutions that do not have an options that were available to institutions when office in a standard metropolitan statistical area; Regulation C became effective. Thus, for the pur­ and (3) State-chartered institutions that are subject poses of § 203.4, a depository institution that to a State disclosure law that the Board had deter­ ceases to be exempt may compile the necessary mined imposes substantially similar requirements mortgage and home improvement loan data by to those mandated by the Home Mortgage Disclo­ United States Postal Service ZIP codes, in lieu sure Act. of Census Bureau census tracts, for its last full Section 203.3(b) sets forth the initial disclosure fiscal year and any portion of its current fiscal year requirements applicable to an exempt institution ending prior to the loss of exemption. In addition, that subsequently loses its exemption. It states: such an institution may exercise the options and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

492 Federal Reserve Bulletin □ May 1977 rely on the presumption contained in paragraphs used, however, in preparing the 1977 disclosure (a)(4)(ii) and (c) of § 203.4 as if it had lost its statement. exemption and become subject to the regulation on July 1, 1976. INTERPRETATION OF REGULATION Z The following examples illustrate the points made in this interpretation. Assume that a deposi­ Disclosure of dealer participation. Section tory institution having a calendar fiscal year ceases 226.8(c)(8)(i) requires the itemization of each to be exempt under § 203.3(a)(2) on April 1, 1977 component of a finance charge consisting of more because of the enlargement of a standard metro­ than one type of charge. Section 226.4(a)(3) lists politan statistical area to include a county in which among the types of charges to be included in the the institution has an office. Pursuant to § finance charge a “finder’s fee or similar charge.” 203.5(a)(l)(iii), that institution would be required In certain credit transactions, such as the sale of to prepare and make available publicly a disclosure automobiles and other consumer goods, where the statement by June 29, 1977, ninety days after its finance charge is determined by application of a loss of exemption. percentage rate or rates to the amount financed, Under § 203.3(b), the disclosure statement a portion of that charge may be allocated to the would have to cover the institution’s “last full dealer by the financial institution as a dealer par­ fiscal year ending prior to the date it was no longer ticipation. The question arises whether such allo­ exempt,” which, as indicated previously, would cations must be itemized as a separate component be 1976. Pursuant to § 203.4(a)(2)(i), read in view of the total finance charge in the nature of a of § 203.3(b), the institution could compile the finder’s fee. necessary loan information for 1976 by ZIP code The requirement for itemization of a finance if it chose. charge which includes a finder’s fee or other ele­ Also, under § 203.4(a)(2)(ii), it could elect to ments in addition to an interest component is issue a separate disclosure statement, compiled on intended to assure that the total finance charge a ZIP-code basis, for the first three months of its disclosed to the customer properly reflects all current fiscal year—January, February, March components which must be included in that 1977, if it also made that statement available on amount. Any component of the finance charge June 29, 1977. If it chose that option, then it would which is computed by the application of a per­ report on its relevant lending activities for the centage rate or rates to the amount financed con­ remainder of 1977 by census tract on March 31, stitutes a single charge of the type described in 1978. The alternative to this latter option would § 226.4(a(l). As such, it must be included in the be for the institution to report on all of its relevant finance charge calculation and disclosure. A por­ lending activities during 1977 by census tract on tion of such single component of the finance charge March 31, 1978. Finally, the institution may ex­ which is distributed to a dealer is not considered ercise the reporting options and rely on the resi­ a “finder’s fee or similar charge” and need not dence presumption set forth in §§ 203.4(a)(4)(H) be separately identified or disclosed. The concept and 203.4(c) for its 1976 disclosure statement and of a “finder’s fee,” as that term is used in § the January through March 1977 statement if that 226.4(a)(3), is intended to cover certain charges option is chosen. in the nature of brokerage fees which are imposed The second example assumes that a depository in addition to that portion of the finance charge institution having a calendar fiscal year ceases to attributable to the application of a percentage rate be exempt under § 203.3(a)(1) because its assets or rates to the amount financed. Any such separate exceed $10,000,000 as of December 31, 1977. fee must, of course, be separately itemized. (In­ Pursuant to the applicable provisions of the regu­ terprets and applies 12 C.F.R. 226.8) lation as outlined in the preceding example, the institution would have to prepare a disclosure statement by March 31, 1978, covering its relevant lending activities during 1977 on a ZIP-code basis. FEDERAL OPEN MARKET COMMITTEE— Since the loss of exemption would not have oc­ RULES REGARDING curred during the course of its fiscal year, no AVAILABILITY OF INFORMATION partial fiscal year report would be possible. The options and presumption contained in §§ The Federal Open Market Committee has 203.4(a)(4)(ii) and 203.4(c) respectively could be amended its Rules Regarding Availability of Infor­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 493 mation as required by section 5(b) of the Government the public in such a manner as to leave no in the Sunshine Act. discretion on the issue, or (B) establishes par­ Effective March 12, 1977, consistent with sec­ ticular criteria for withholding or refers to par­ tion 5(b) of the Government in the Sunshine Act ticular types of matters to be withheld; or is (Pub. L. No. 94-409, 5 U.S.C. §552b), the Fed­ specifically authorized under criteria established eral Open Market Committee hereby amends sec­ by an executive order to be kept secret in the tion 271.6(a) of Title 12 of the Code of Federal interest of national defense or foreign policy and Regulations. The amendment will revise the is in fact properly classified pursuant to such Committee’s Rules with regard to exemption (3) executive order. of the Freedom of Information Act. and will read as follows: Section 271.6—Information Not Disclosed The requirements of section 553 of Title 5 Except as may be authorized by the Commit­ United States Code with respect to notice, pub­ tee, information of the Committee that is not lic participation, and deferred effective date available to the public through other sources will were not followed in connection with this not be published or made available for inspec­ amendment because the amendment merely tion, examination, or copying by any person if conforms the Committee’s rules to the language such information of exemption 552(b)(3) of the Freedom of In­ (a) is specifically exempted from disclosure formation Act, as amended by section 5(b) of by statute (other than section 552b of Title 5 the Government in the Sunshine Act which will United States Code), provided that such statute become effective on March 12, 1977, and thus (A) requires that the matters be withheld from such procedures were found to be unnecessary. BANK HOLDING COMPANY AND BANK MERGER ORDERS ISSUED BY THE BOARD OF GOVERNORS Orders Under Section 3 submitted on the proposal, including a request, of Bank Holding Company Act with accompanying statement of reasons, that an oral presentation be conducted on this application, Central Bancompany, the Board of Governors has concluded that the Jefferson City, Missouri public interest would be served by the conduct of an oral presentation with respect to the application. Accordingly, it is hereby ordered that pursuant Order for Oral Presentation to section 262.3(g)(3) of the Board’s Rules of Central Bancompany, Jefferson City, Missouri, Procedures [12 CFR § 262.3(g)(3) (1976)] a public has filed an application pursuant to section 3(a)(3) oral presentation be held with respect to this ap­ of the Bank Holding Company Act of 1956 (12 plication before Baldwin B. Tuttle, Deputy Gen­ U.S.C. § 1842(a)(3)) for prior approval by the eral Counsel of the Board of Governors, at the Board of Governors to acquire not less than 57 Federal Reserve Bank of St. Louis, 411 Locust per cent of the voting shares of The First National Street, St. Louis, Missouri, in such manner and Bank of Mexico, Mexico, Missouri. Notice of at such date and time as he shall designate after receipt of this application was published in the receipt of requests to appear. Federal Register (41 F.R. 51462) on November It is further ordered that the proceeding will 22, 1976. The published notice advised that the consist of presentations of statements in either oral application was available for inspection at the or written form, together with any supporting or offices of both the Board of Governors and the supplementary written submissions allowed by the Federal Reserve Bank of St. Louis and designated presiding officer, all of which submissions are to a period within which comments and views on the be addressed to the factors set forth in Section proposed acquisition could be filed with the Board 3(c) of the Bank Holding Company Act of 1956, of Governors. as amended, with respect to this application. Having considered the numerous comments It is further ordered that any person desiring Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

494 Federal Reserve Bulletin □ May 1977 to give testimony, present evidence, or otherwise deposits of approximately $1.3 billion, repre­ participate in the scheduled oral presentation, senting 7.7 per cent of the total commercial bank should file with the Secretary of the Board of deposits in the State. Acquisition of Bank ($13.3 Governors of the Federal Reserve System, Wash­ million in deposits) would not significantly in­ ington, D.C. 20551, on or before May 6, 1977, crease the concentration of banking resources in a written request to appear at said oral presenta­ Missouri; however, it would have adverse effects tion, including a statement of the nature of the upon concentration in the relevant market. petitioner’s interest in the proceedings, the extent Bank, the fifth largest of 21 banks in the relevant of the participation desired, and a summary of the market2 and the only remaining independent bank matters concerning which the petitioner desires to in the City of St. Joseph, has total deposits of either give testimony or submit evidence. Requests $13.3 million, representing 3 per cent of the total to participate in the proceedings will be submitted commercial bank deposits in the relevant market. to the presiding officer for his determination and Applicant is already represented in the St. Joseph petitioners submitting them will be notified of the market through its ownership of Commerce Bank decision as well as the date and time of the of St. Joseph (“Commerce Bank”). Commerce proceeding. Bank is the fourth largest bank in the market, with By order of the Board of Governors, effective total deposits of $39.9 million, representing 8.83 April 11, 1977. per cent of the total commercial bank deposits in the relevant market. The four largest banking Voting for this action: Vice Chairman Gardner and organizations in the St. Joseph banking market Governors Wallich, Partee, and Lilly. Voting against this action: Governors Coldwell and Jackson. Absent hold in the aggregate about 85.6 per cent of total and not voting: Chairman Burns. commercial bank deposits in the market. Consum­ mation of this proposal would further increase that (Signed) R uth A. R eister, concentration level to 88.6 per cent and Applicant [seal] Assistant Secretary of the Board. would enhance its position in the market by be­ coming the third largest banking organization. Commerce Bancshares, Inc., In addition to having adverse effects on concen­ Kansas City, Missouri tration in the St. Joseph market, it appears that consummation of this proposal would eliminate Order Denying Acquisition of Bank significant existing competition between Bank and Commerce Bancshares, Inc., Kansas City, Commerce Bank. Applicant maintains that Bank Missouri, a bank holding company within the and Commerce Bank serve essentially different meaning of the Bank Holding Company Act, has kinds of customers3 and that Bank’s location and applied for the Board’s approval under § 3(a)(3) orientation toward farm lending make it unlikely of the Act (12 U.S.C. § 1842(a)(3)) to acquire that Bank would expand its operations in the 51.96 per cent of the voting shares of the Farmers primary service area of Commerce Bank. How­ State Bank, St. Joseph, Missouri, St. Joseph, ever, the record shows that each derives a signifi­ Missouri (“Bank”). cant amount of its deposits and loans from the Notice of the application, affording opportunity service area of the other. Thus, the Board con­ for interested persons to submit comments and cludes that consummation of the proposal would views, has been given in accordance with § 3(b) eliminate significant existing competition between of the Act. The time for filing comments and views Applicant and Bank. has expired, and the Board has considered the application and all comments received, including those submitted by the Missouri Commissioner of Finance and by the U.S. Department of Justice, 2The relevant market is the St. Joseph banking market, which is approximated by Buchanan County (less Rush and in light of the factors set forth in § 3(c) of the Bloomington Townships), Andrew County, and western De- Act (12 U.S.C. § 1842(c)). Kalb County, all in Misouri, and northern Doniphan County in Kansas. Applicant, the third largest banking organization 3 Applicant characterizes Commerce Bank’s customers as in Missouri,1 controls 31 banks with aggregate primarily a merchant and wage-earner clientele not associated with the south St. Joseph area. Applicant states that Bank primarily serves agriculturally oriented businesses in the south St. Joseph area. The Board does not view this as a legitimate distinction in defining the relevant product for purposes of 'All banking data are as of December 31, 1975. competitive analysis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 495 In acting on this application, the Board has also lending advice. The Board notes that Bank has considered the comments of the Department of only a limited need for help in handling loans Justice and of the Missouri Commissioner of Fi­ above its present legal lending limit. "1 Furthermore, nance (“the Commissioner”) and Applicant’s re­ with respect to Applicant’s proposal to provide sponses thereto. Both the Department of Justice Bank with agricultural lending advice, Applicant and the Commissioner indicated that, in their re­ made a similar argument in its earlier application spective opinions, the proposed acquisition would to the Board to acquire Commerce Bank some six eliminate existing competition and lead to a further years ago, and it appears that Commerce Bank concentration of banking resources in the City of has made no significant increases in its agricultural St. Joseph. Both agencies noted that because Bank lending program since its acquisition by Applicant. was the last independent bank in the City of St. Accordingly, the Board finds that little weight can Joseph, it was a likely candidate for acquisition be accorded such services and that considerations as a vehicle for entry into the City of St. Joseph relating to the convenience and needs of the com­ by a regional or Statewide banking organization munity to be served lend no significant weight not presently represented in the market. toward approval of the application. In summary, While both the Department of Justice and the therefore, the considerations relating to banking Commissioner placed emphasis on the effects of factors and the considerations relating to the con­ the proposal on the City of St. Joseph rather than venience and needs of the community to be served the somewhat larger St. Joseph banking market,1 do not outweigh the adverse competitive effects the Board is of the view that their general findings that would result from Applicant’s acquisition of as to the adverse effects of the subject proposal Bank. are supported by the facts of record. In addition, On the basis of the facts in the record, and in the Board finds on the basis of the foregoing and light of the factors set forth in § 3(c) of the Act, other facts of record, that competitive consid­ it is the Board’s judgment that approval of the erations relating to this application weigh proposal would not be in the public interest. Ac­ sufficiently against approval so that it should not cordingly, the application is denied for the reasons be approved unless the anticompetitive effects are summarized herein. clearly outweighed by benefits to the public in By order of the Board of Governors, effective meeting the convenience and needs of the com­ April 1, 1977. munity to be served. Voting for this action: Governors Wallich, Coldwell, The financial and managerial resources and Jackson, Partee, and Lilly. Absent and not voting: prospects of Bank are regarded as satisfactory. The Chairman Burns and Governor Gardner. financial and managerial resources and prospects (Signed) G riffith L. G arw ood, of Applicant and its subsidiaries are regarded as [seal] Deputy Secretary of the Board. generally satisfactory. Although Applicant would incur some debt as a result of this acquisition, it Country Bank Shares Corporation, appears that Applicant’s earnings from normal Janesville, Wisconsin operations are sufficient to retire that debt as pro­ jected. Accordingly, the Board finds that consid­ Order Denying Acquisition of Bank erations relating to financial and managerial re­ Country Bank Shares Corporation, Janesville, sources and future prospects are consistent with Wisconsin (“Applicant”), a bank holding com­ approval; however, such considerations do not pany within the meaning of the Bank Holding lend significant weight for approval of the appli­ Company Act (“Act”), has applied for the cation. Board’s approval under § 3(a)(3) of the Act (12 Applicant states that upon acquisition of Bank U.S.C. § 1842(a)(3)) to acquire 72.8 per cent of it would expand Bank’s services, including in­ the voting shares of the State Bank of Argyle, creasing Bank’s lending capacity through loan Argyle, Wisconsin (“Bank”). participations and providing Bank with agricultural ‘See the Board’s Order approving the merger of Ameribanc, 5Bank has no large business customers, and the farmers in Inc., St. Joseph, Missouri, with First American Bancshares, its service area conduct small operations. The few loans for Inc., St. Joseph, Missouri. 62 Federal Reserve Bulletin, p. which Bank has needed assistance have been readily handled 384. by its St. Joseph and Kansas City correspondents. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

496 Federal Reserve Bulletin □ May 1977 Notice of the application, affording opportunity all the facts of record, including the debt burden for interested persons to submit comments and Applicant must bear and the flow of funds needed views, has been given in accordance with § 3(b) to service such debt, consummation of the pro­ of the Act. The time for filing comments and views posal may cause Applicant to make demands upon has expired, and the Board has considered the Bank in the form of dividend payments which may application and all comments received in light of serve to weaken the capital position of Bank. In the factors set forth in § 3(c) of the Act (12 U.S.C. view of the limited financial flexibility of Appli­ § 1842(c)). cant, a strain may be placed upon Bank’s capital Applicant presently controls one bank, The position as a result of Applicant’s debt servicing Montello State Bank, Montello, Wisconsin, with requirements. Furthermore, in light of Applicant’s deposits of $10.1 million, representing .07 per financial condition, it is not in a position to come cent of total commercial bank deposits in Wiscon­ to Bank’s assistance in the event any unexpected sin.1 Bank ($9.5 million in deposits) is the sixth problems arise at Bank. Accordingly, the Board largest of thirteen commercial banking organi­ concludes that financial considerations weigh zations competing in the Darlington/Monroe against approval of this application. banking market,2 controlling 5.0 per cent of mar­ With respect to managerial resources, the facts ket deposits. Bank is currently controlled by Mc­ of record suggest that Applicant’s principals have Guire Wausau Agency and Management Opera­ engaged in certain transactions involving other tions, Inc., both of which are controlled by Appli­ financial institutions with which they are affiliated cant’s principals. Several of Applicant’s principals which reflect unfavorably on the managerial re­ are affiliated with six other Wisconsin banks, each sources of Applicant and lend weight for denial. of which is located in a banking market separate In considering all the facts of record, the Board from Bank. Inasmuch as the proposal involves is unable to conclude that approval of the subject essentially a restructuring of Bank’s ownership, application would be consistent with the financial the proposed transfer would eliminate neither ex­ and managerial standards the Board is required to isting nor potential competition, and would not consider under Section 3(c) of the Act, or that increase the concentration of banking resources in the public interest would be served by such action. any relevant area. Therefore, competitive consid­ In regard to considerations relating to the con­ erations are consistent with approval of the appli­ venience and needs of the communities to be cation. served, the record indicates that banking needs are The Board’s inquiry, however, does not end currently being adequately served by Bank. While here. As the Board has indicated on previous these considerations appear to be consistent with occasions, it believes a bank holding company approval of the application, they are not sufficient, should constitute a source of both financial and in the Board’s view, to outweigh the adverse managerial strength to its subsidiary bank(s). Ac­ banking factors reflected in the record that are cordingly, in acting upon any application under associated with this proposal. Accordingly, it is the Act, the Board will closely examine the finan­ the Board’s judgment that approval of the applica­ cial condition, managerial resources, and future tion would not be in the public interest and that prospects of an applicant and its subsidiary bank(s) the application should be denied. Accordingly, the with these factors in mind. Based upon an evalua­ application is hereby denied for the reasons sum­ tion of such factors with respect to this application, marized above. the Board has determined that denial of this appli­ By order of the Board of Governors, effective cation is warranted. April 25, 1977. With respect to the financial resources and future prospects associated with this application, the rec­ ord indicates that the overall financial condition of Applicant does not permit it to be a source of Voting for this action: Chairman Burns and Gover­ strength to Bank. Based upon an examination of nors Gardner, Wallich, Partee, and Lilly. Absent and not voting: Governors Coldwell and Jackson. 1 All deposit data are as of December 31, 1975. 2The Darlington/Monroe banking market is approximated (Signed) Griffith L. Garwood, by Green County, except Decatur township and the eastern three-fifths of Lafayette County. [seal] Deputy Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 497 NBC Corp., of thirteen banks in the Gibson County banking Jackson, Tennessee market, with 9.7 per cent of total market deposits. Neither Jackson Bank nor Humboldt Bank derives Order Approving substantial amounts of deposits or loans from the Formation of Bank Holding Company other’s market area, and, accordingly, no signifi­ NBC Corp., Jackson, Tennessee has applied for cant competition between Jackson Bank and the Board’s approval under § 3(a)(1) of the Bank Humboldt Bank would be eliminated by consum­ Holding Company Act (12 U.S.C. 1842(a)(1)) of mation of the acquisitions. Moreover, potential formation of a bank holding company through competition would not be adversely affected by acquisition of 100 per cent1 of the voting shares consummation of the acquisitions as neither bank­ of the successor by merger to The National Bank ing market appears attractive for de novo entry. of Commerce of Jackson (“Jackson Bank”), Accordingly, it is concluded that competitive con­ Jackson, Tennessee and 83.1 per cent of the voting siderations are consistent with approval of the shares of The First National Bank of Gibson application. County (“Humboldt Bank”), Humboldt, Tennes­ The financial and managerial resources and fu­ see (hereinafter collectively referred to as ture prospects of Applicant, which are dependent “Banks”). The bank into which Jackson Bank is upon those of Banks, are regarded as satisfactory. to be merged has no significance except as a means Although Applicant will incur debt in connection to facilitate the acquisition of the voting shares with its acquisition of shares of Humboldt Bank, of Jackson Bank. Accordingly, the proposed ac­ its income from Banks should provide sufficient quisition of the shares of the successor organi­ revenue to service the debt without impairing the zation is treated herein as the proposed acquisition financial condition of either proposed subsidiary of shares of Jackson Bank. bank. In addition to incurring debt, Applicant will Notice of the application, affording opportunity fund the subject proposal through a special divi­ for interested persons to submit comments and dend from Jackson Bank that may equal or exceed views, has been given in accordance with § 3(b) Jackson Bank’s income for 1977 but, in light of of the Act. The time for filing comments and views Jackson Bank’s capital strength, satisfactory man­ has expired, and the application and all comments agement and future prospects, the dividend should received have been considered in light of the not adversely affect Jackson Bank’s overall finan­ factors set forth in § 3(c) of the Act (12 U.S.C. cial condition.3 Although the financial and mana­ § 1842(c)). gerial resources and future prospects of Jackson Applicant is a non-operating corporation organ­ Bank are considered satisfactory, those of Hum­ ized for the purpose of becoming a bank holding boldt Bank are not entirely satisfactory at the company. Jackson Bank and Humboldt Bank have present time but are expected to show marked aggregate deposits of $78.3 million, representing improvement as a result of Humboldt Bank’s .6 per cent of the total deposits in commercial affiliation with Jackson Bank and Applicant. banks in Tennessee and, upon consummation, Therefore, considerations relating to banking fac­ Applicant would rank as the eleventh largest of tors are consistent with approval of the application, twelve multibank holding companies in the State.2 and considerations relating to convenience and Approval of the application would not increase needs are also regarded as being consistent with significantly the concentration of banking re­ approval of the application. It is the Board’s judg­ sources in Tennessee. ment that consummation of the proposal to form Jackson Bank ($66.2 million in deposits as of a bank holding company would be in the public June 30, 1976) is the second largest of four banks interest and that the application should be ap­ operating in the Madison County banking market proved. and holds approximately 29.1 per cent of total On the basis of the record, the application is market deposits. Humboldt Bank ($14.4 million approved for the reasons summarized above. The in deposits as of June 30, 1976) is the fifth largest transaction should not be made (a) before the thirtieth calendar day following the effective date ‘Applicant subsequently will resell qualifying shares to directors of The National Bank of Commerce of Jackson. 2All banking data are as of December 31, 1975, unless 3Payment of the special dividend will not be in an amount otherwise noted. violative of section 5199 of the Revised Statutes. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

498 Federal Reserve Bulletin □ May 1977 of this Order, or (b) later than three months after deposits of $148.8 million, representing approxi­ the effective date of this Order, unless such period mately six-tenths of one per cent of the total is extended for good cause by the Board or by deposits held by commercial banks in Florida and the Federal Reserve Bank of St. Louis pursuant ranks as the twenty-ninth largest commercial to delegated authority. banking organization in that State.3 Consummation By order of the Board of Governors, effective of the subject proposal would increase Applicant’s April 6, 1977. share of State deposits by approximately one-hun­ dredth of one per cent, and would not have a Voting for this action: Chairman Burns and Gover­ significant effect upon the concentration of banking nors Wallich, Coldwell, Jackson, Partee, and Lilly. Absent and not voting: Governor Gardner. resources in Florida. Bank (with deposits of $7.4 million as of Sep­ (Signed) G riffith L. G arw ood, tember 30, 1976) is the twelfth largest of the 17 [seal] Deputy Secretary of the Board. banking organizations in the Jacksonville banking market4 and holds approximately three-tenths of The Royal Trust Company, one per cent of the market’s total commercial bank Montreal, Quebec, Canada deposits. Applicant is not currently represented in Order Approving Acquisition of Bank the relevant banking market and its closest banking subsidiary to Bank is located approximately 185 The Royal Trust Company, Montreal, Quebec, miles southwest of Bank. There does not appear Canada, a bank holding company within the to be any existing competition between Bank and meaning of the Bank Holding Company Act, has any of Applicant’s present banking or nonbanking applied for the Board’s approval under Section subsidiaries and, in view of the distances involved, 3(a)(3) of the Act [12 U.S.C. § 1842(a)(3)] to it does not appear likely that any significant com­ acquire 80 per cent or more of the voting shares petition would develop in the future. While Ap­ of Baymeadows Bank, Jacksonville, Florida plicant could enter the relevant market de novo, (“Bank”). in view of Bank’s relative size and its market Notice of the application, affording opportunity position, the Board views the proposed acquisition for interested persons to submit comments and of Bank as essentially a foothold entry by Appli­ views, has been given in accordance with Section cant into the market.5 Such entry by Applicant 3(b) of the Act. The time for filing comments and should have a salutary effect upon competition views has expired, and the Board has considered among the banking organizations in the relevant the application and all comments received in light market by enabling Bank to compete more effec­ of the factors set forth in Section 3(c) of the Act tively in that market. Therefore, on the basis of [12 U.S.C. § 1842(c)]. the facts of record, the Board concludes that con­ Applicant, with total assets of $4.1 billion (as summation of the proposal would not have any of September 30, 1976) is one of the largest significant adverse effects upon either existing or financial institutions in Canada, and operates, potential competition in any relevant area, and that through its subsidiaries and other interests, in both competitive considerations are consistent with ap­ Europe and the Caribbean Islands. In the United proval of the application. States, Applicant controls five Florida banks1 and operates one nonbank subsidiary.2 Through its five subsidiary banks, Applicant controls aggregate § 4(c)(9) of the Act [ 38 Federal Register 34514 (1973); 60 Federal Reserve Bulletin 58 (1974)]. ISD-California is en­ gaged in nonpermissible data processing activities while ISD- Florida is engaged in permissible data processing activities. Applicant currently controls these subsidiary banks through The Board granted Applicant a 2-year period, after its acquisi­ Royal Trust Bank Corp., Miami, Florida (“Corp.”), itself a tion of Computel, within which to divest itself of ISD-Califorregistered bank holding company. Corp. was formed in 1976 nia. On January 31, 1977, the Board approved a plan of as a wholly owned subsidiary of Applicant in order to hold divestiture of ISD-California that had been submitted by Ap­ directly all of Applicant’s banking interests in the United plicant. Immediately prior to consummation of the divestiture States. proposal, Applicant will retain ISD-FIorida through a corporate information Systems Design of Florida, Inc., Miami, reorganization by which ISD-FIorida will be transferred to Florida (“ISD-FIorida”), is a subsidiary of Information Sys­ Applicant or to another subsidiary of Applicant. tems Design, Inc., Santa Clara, California (“ISD-California”), 3 All banking data are as of December 31, 1975, unless which is owned by Computel Systems, Ltd. (“Computel”), otherwise indicated. a Canadian data processing company. By Oitler of December 4 The Jacksonville banking market encompasses Duval 6, 1973, the Board denied Applicant’s retention of ISD-Cali­ County and the Orange Park area in northern Clay County. fornia after Applicant’s acquisition of Computel pursuant to 5Bank opened for business on May 15, 1975. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 499 The financial and managerial resources and fu­ of the factors set forth in § 3(c) of the Act (12 ture prospects of Applicant, its subsidiary banks U.S.C. § 1842(c)). and Bank are regarded as being generally satis­ Applicant, a nonoperating corporation with no factory. Therefore, considerations relating to subsidiaries, was organized for the purpose of banking factors are consistent with approval of the becoming a bank holding company through the application. Applicant will provide Bank with its acquisition of Bank. Bank holds deposits of $9.6 expertise in the areas of international banking, million1 and was, as of December 31, 1975, the trust services, investment management, accounts second largest of five commercial banks in the receivable financing, factoring, personal property relevant market,2 controlling 20.6 per cent of the and equipment leasing, and will be a source of total deposits in commercial banks in the relevant capital to Bank as needed. Considerations relating market. Upon acquisition of Bank, Applicant to the convenience and needs of the community would control approximately .08 per cent of the to be served lend some weight toward approval. total commercial bank deposits in Iowa. Since the It is the Board’s judgment that the proposed ac­ proposed transaction is essentially a reorganization quisition would be in the public interest and that of existing ownership interests whereby Bank’s the application should be approved. principal shareholders would substitute for their On the basis of the record, the application is direct control of Bank indirect control of Bank approved for the reasons summarized above. The through Applicant, consummation of the proposal transaction shall not be made (a) before the thir­ would not eliminate any existing competition, nor tieth calendar day following the effective date of would it appear to have any adverse effects on this Order or (b) later than three months after the other banks or on the development of potential effective date of this Order, unless such period competition in the relevant market. Therefore, is extended for good cause by either the Board competitive considerations do not weigh against or the Federal Reserve Bank of Atlanta pursuant approval of the application. to delegated authority. The Board has indicated on previous occasions By order of the Board of Governors, effective that it believes that a holding company should April 8, 1977. constitute a source of financial and managerial strength to its subsidiary bank(s), and that the Voting for this action: Chairman Burns and Gover­ Board will closely examine the condition of an nors Coldwell, Jackson, Partee, and Lilly. Absent and not voting: Governors Gardner and Wallich. applicant in each case with this consideration in mind. The record indicates that Bank is in need (Signed) G riffith L. G arw ood, of additional capital. However, Applicant pro­ [seal] Deputy Secretary of the Board. poses to incur a substantial amount of debt to acquire shares of Bank. Applicant proposes to repay that debt over a period of twelve years solely Sibley Bancorporation, with dividends from Bank. The dividend pay^t Sibley, Iowa that would be required of Bank under Applicant’s Order Denying proposal would serve to weaken the capital posi­ Formation of Bank Holding Company tion of Bank.3 In view of the limited financial flexibility of Applicant, the strain that would be Sibley Bancorporation, Sibley, Iowa, has ap­ placed on Bank’s capital position as a result of plied for the Board’s approval under § 3(a)(1) of Applicant’s debt servicing requirements, and other the Bank Holding Company Act (12 U.S.C. § facts of record, the Board is of the opinion that 1842(a)(1)) of formation of a bank holding com­ considerations relating to the financial and mana­ pany through acquisition of 93 per cent or more gerial resources and future prospects of Applicant of the voting shares of The First National Bank and Bank weigh against approval of the applica­ of Sibley, Sibley, Iowa (“Bank”). tion. Notice of the application, affording opportunity for interested persons to submit comments and views, has been given in accordance with § 3(b) JA11 banking data are as of December 31, 1975. 2The relevant banking market is Osceola County. of the Act. The time for filing comments and views 3Applicant proposes that Bank sell $150,000 in long-term has expired, and the Board has considered the notes to be due two years after Applicant’s acquisition debt matures. Proceeds of that note issue would not constitute application and all comments received, including permanent capital and repayment of those notes may well serve those of the Comptroller of the Currency, in light further to weaken Bank’s capital. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

500 Federal Reserve Bulletin □ May 1977 Applicant proposes to make minor changes in of the Act. The time for filing comments and views Bank’s services. However, the Board finds that has expired, and the Board has considered the the considerations relating to the convenience and applications and all comments received in light of needs of the community to be served do not the factors set forth in § 3(c) of the Act (12 U.S.C. outweigh the adverse findings with respect to the § 1842(c)). financial and managerial resources and future Applicant, the third largest banking organization prospects of Applicant and Bank. in Texas, controls 31 banks with aggregate depos­ On the basis of all of the circumstances con­ its of approximately $3.3 billion, representing 6.9 cerning this application, the Board concludes that per cent of the total deposits in commercial banks the financial considerations involved in this pro­ in the State.1 As a result of the acquisition of Bank, posal present adverse circumstances bearing upon Applicant’s share of commercial bank deposits in the financial resources and future prospects of both Texas would increase by 0.7 per cent to a total Applicant and Bank. Such adverse factors are not of 7.6 per cent, and Applicant would become the outweighed by any procompetitive effects or by largest banking organization in the State. substantial benefits that would result in serving the In recent years, the Board has denied certain convenience and needs of the community. Ac­ applications submitted by some of the larger cordingly, it is the Board’s judgment that approval banking organizations in Texas to acquire leading of the application would not be in the public banks in the State’s secondary banking markets. interest and that the application should be denied. In its orders relating to those applications, the On the basis of the record, the application is Board found generally that approval of such pro­ denied for the reasons summarized above. posals would result in an increase in the share of By order of the Board of Governors, effective deposits held by the State’s largest organizations, April 8, 1977. as well as an increase in the size disparity between those institutions and the State’s smaller bank Voting for this action: Chairman Burns and Gover­ holding companies.2 The Board is now of the view nors Coldwell, Jackson, Partee, and Lilly. Absent and not voting: Governors Gardner and Wallich. that its previously stated concern relating to the level of concentration of banking resources in­ (Signed) G riffith L. G arw ood, volving the largest banking organizations in Texas [seal] Deputy Secretary of the Board. is no longer entirely warranted and should be tempered in light of developments subsequent to Texas Commerce Bancshares, Inc., 1974. In particular, since the time of those denials, Houston, Texas the percentage of commercial banking resources Order Approving the in Texas controlled by the State’s four largest Merger of Bank Holding Companies banking organizations has not increased apprecia­ bly, thus indicating that the Board’s earlier actions Texas Commerce Bancshares, Inc., Houston, have had a salutary effect in retarding the rate at Texas (“Applicant”), a bank holding company which increased concentration was occurring. within the meaning of the Bank Holding Company Furthermore, the present level of concentration of Act, has applied for the Board’s approval under banking resources in Texas is relatively low in § 3(a)(5) of the Act (12 U.S.C. § 1842(a)(5)) to comparison to the level of concentration in other merge with The BanCapital Financial Corporation, States as evidenced by the fact that, based on the Austin, Texas (“Company”), a bank holding percentage of deposits held by the three largest company, and thereby acquire 100 per cent (less directors’ qualifying shares) of The Capital Na­ tional Bank in Austin, Austin, Texas (“Bank”). In light of the facts that Company’s only assets are the shares of Bank, and that Company does 1 Unless otherwise noted, all banking data are as of Sep­ tember 30, 1976, and reflect bank holding company formations not engage in any activity other than controlling and acquisitions approved through February 28, 1977. Bank, Applicant’s proposed merger with Company 2See the Board’s Orders denying the applications of First is treated herein as the proposed acquisition of International Bancshares, Inc., Dallas, Texas, to acquire Citi­ zens First National Bank of Tyler, Tyler, Texas (60 Fed. Res. Bank. Bulletin 43 (1974)) and The First National Bank of Waco, Notice of the application, affording opportunity Waco, Texas (60 Fed. Res. Bulletin 290 (1974)); and application of First City Bancorporation of Texas, Inc., Hous­ for interested persons to submit comments and ton, Texas, to acquire The Lufkin National Bank, Lufkin, views, has been given in accordance with § 3(b) Texas (60 Fed. Res. Bulletin 450 (1974)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 501 banking organizations, Texas ranks 43rd out of deposits. In that denial Order, the Board also the 50 States in terms of concentration levels.3 stated that reasonable alternative means of entry Accordingly, while the Board continues to be of into the Austin market were available to Applicant the view that the effect of a proposal on concen­ other than the acquisition of the market’s largest tration is a matter that deserves studied attention, bank. The Board concluded that Applicant’s ac­ the recent trend in the banking structure of Texas quisition of Austin Bank would have significant is such that the Board does not view the concen­ adverse effects on the concentration of banking tration increase that would follow upon consum­ resources and on potential competition within the mation of this proposal as so adverse as to require Austin banking market and that such anticompeti­ denial thereof. tive effects were not outweighed by considerations Bank holds deposits of approximately $356.5 relating to the convenience and needs of the com­ million, representing 21.4 per cent of total deposits munities to be served. in commercial banks in the Austin banking mar­ The Board has reexamined the Austin banking ket,4 and ranks as the second largest of 23 banks market in the context of the subject proposal. Upon operating in the market. Applicant is not presently such reexamination, the Board is of the view that represented in the Austin banking market; its sub­ its previous concerns, which it then believed were sidiary bank closest to Bank is located 48 miles justified, regarding the structure of the Austin away in the San Antonio banking market. It ap­ market and the likely adverse competitive effects pears that no meaningful competition currently within that market of Applicant’s proposed acqui­ exists between the two organizations. Thus, con­ sition, should not presently be given the weight summation of Applicant’s proposal would not have that they were at that time. Although the level any significant adverse effects on existing compe­ of concentration of banking resources in the Austin tition within the relevant market. market has not changed appreciably since the This application represents Applicant’s second Board’s denial of Applicant’s previous proposal, attempt to enter the Austin banking market through the Board does not now view Applicant’s acquisi­ acquisition of one of that market’s leading banks. tion of Bank as significantly reducing the likeli­ In January of 1975, the Board denied Applicant’s hood that the market would become less concen­ proposed acquisition of The Austin National Bank, trated in the future. The Austin area has experi­ Austin, Texas (“Austin Bank”).5 In denying that enced exceptionally rapid growth in recent years. application, the Board stated that the acquisition In view of this economic growth, it appears that of such a significant competitor as Austin Bank the market is attractive for entry by other banking in a highly concentrated market by one of the organizations and a number of the State’s largest State’s leading competitors would significantly re­ banking organizations are not presently repre­ duce the likelihood that the market would become sented in that market. The Board concludes that less concentrated and more competitive in the approval of this application would not foreclose future. At that time, Austin Bank was the largest the possibility of such other competitors entering commercial bank in the market and controlled the market either de novo or through acquisition approximately 23 per cent of the market’s depos­ of one of the many independent banks. its. The four largest banking organizations in the With respect to potential competition, while Austin banking market controlled 79 per cent of consummation of this proposal would eliminate the possibility of Applicant entering the Austin market de novo or through acquisition of one of the numerous smaller independent banks, the Board ^Concentration data are as of December 31, 1975. is now of the view that Applicant’s entry into the 4The relevant geographic market for purposes of analyzing Austin market should not be restricted to estab­ the competitive effects of the subject application is approxi­ mated by the Austin SMSA, which is comprised of Hays and lishing a bank de novo or acquiring a foothold Travis Counties, Texas. entry. Thus, the Board is presently unable to 5 Board Order dated January 22, 1975, denying the applica­ conclude that consummation of the proposed tions of Texas Commerce Bancshares, Inc., Houston, Texas, to acquire The Austin National Bank, Austin, Texas, and Oak transaction would have such adverse effects upon Hill National Bank, Oak Hill, Texas (61 Fed. Res. Bulletin the concentration of banking resources or upon 109 (1975)). In its Order, the Board approved the application to acquire Oak Hill National Bank, but under the terms of potential competition within the Austin banking the agreement between Applicant and Austin Bancshares Cor­ market as to justify denial of the subject applica­ poration, the parent holding company of the two banks, Appli­ tion. On the other hand, approval of this applica­ cant could not acquire only the shares of Oak Hill National Bank. tion may have a positive effect on competition in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

502 Federal Reserve Bulletin □ May 1977 the market by introducing a new and aggressive By order of the Board of Governors, effective competitor into the Austin banking market. April 13, 1977. The financial and managerial resources of Ap­ Voting for this action: Chairman Burns and Gover­ plicant, its subsidiaries and Bank are considered nors Gardner, Coldwell, Jackson, Partee, and Lilly. generally satisfactory and the future prospects for Voting against this action: Governor Wallich. each appear favorable. In commenting upon the (Signed) R uth A. R eister, subject proposal, the Comptroller of the Currency recommended conditioning approval of the appli­ [seal] Assistant Secretary of the Board. cation upon injection of $3 million in capital into Dissenting Statement of Governor Wallich Bank within six months of its acquisition by Ap­ plicant. In response to the Comptroller of the I would deny the application of Texas Com­ Currency’s comments, Applicant has committed merce Bancshares to acquire BanCapital Financial to inject $5 million of equity capital into Bank Corporation, Austin, Texas. I cannot agree with upon consummation of its proposal. Thus, the the majority in their conclusion that the proposed Board is of the view that the banking factors acquisition may have a positive effect on competi­ involved in the proposal lend weight toward ap­ tion in the Austin banking market. In my view, proval of the application. this acquisition will have significantly adverse ef­ Information contained in the record indicates fects in reducing potential competition in the Aus­ that banks within the Austin market are not pres­ tin banking market that are not outweighed by any ently fully meeting all of the banking needs of projected convenience and needs. Additionally, I the area, especially the needs of large national and believe this acquisition will have an adverse effect international corporations located in the Austin on the structure of Texas banking markets in vicinity. Applicant proposes to provide Bank with general by signaling a decrease in the Board’s its specialized expertise in international banking, concern over increased concentration in Texas trust operations and investments. In addition, banking markets. affiliation with Applicant would expand Bank’s In a decision just two years ago,1 the Board credit capabilities. While the weight to be ac­ denied an application by Texas Commerce to ac­ corded to such improved services and increased quire the largest bank in the Austin banking mar­ convenience is somewhat uncertain, it is clear that ket, a bank with approximately 23 per cent of the the ready availability of Applicant’s financial re­ market’s total deposits. The same Applicant now sources and expertise should benefit the Austin seeks to acquire a bank of almost identical size, area by providing a climate for continued eco­ the second largest in the Austin market, with nomic expansion. Accordingly, considerations re­ approximately 21.4 per cent of the market, ^ e lating to the convenience and needs of the com­ prior denial was based upon the Board’s concerns munities to be served lend some weight toward with concentration in the Austin market and the approval of the application. In view of the forego­ significantly adverse effect upon potential compe­ ing, it is the Board’s judgment that Applicant’s tition the acquisition would have, given the likeli­ acquisition of Bank would be in the public interest. hood of either de novo or foothold entry. On the basis of the record, the application is Neither the factual situation nor the underlying approved for the reasons summarized above.6 The adverse competitive effects have changed signifi­ transaction shall not be made (a) before the thir­ cantly in the two years since the first application tieth calendar day following the effective date of was denied. Applicant has increased both its this Order, or (b), later than three months after share of total State deposits (6.9 per cent as the effective date of this Order unless such period opposed to 6.3 per cent) and the number of banks is extended for good cause by the Board, or by it controls (31 from 25) since the 1975 denial. the Federal Reserve Bank of Dallas pursuant to Approval of this acquisition will make Applicant delegated authority. the largest banking organization in Texas. Addi­ 6A member of Applicant’s board of directors is also a member of the board of directors of Austin Bancshares Cor­ poration, the holding company which controls two banks in the Austin market including the largest bank in the market. 1 Board Order denying the application of Texas Commerce Accordingly, the Board conditions its approval of this applica­ Bancshares, Houston, Texas, to acquire Austin Bancshares tion upon a termination of this director interlock prior to Corporation, Austin, Texas (61 Fed. Res. Bulletin 109 consummation of the subject proposal. (1975)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 503 tionally, the Austin banking market remains very amounts to approximately 10 per cent or more.” attractive to de novo entry and highly concen­ The Board, like the Department of Justice, must trated. The largest four banking organizations in rely upon market shares and on concentration the Austin market control approximately 78 per ratios, whether measured in the traditional form cent of total deposits, while the largest eight con­ or through devices such as the “Herfindahl” index trol approximately 91 per cent. or “Gini” coefficient, as the principal means of As to the underlying adverse competitive ef­ detecting anticompetitive acquisitions and oli­ fects, I am somewhat concerned over the level of gopolistic behavior. Contrary to the majority concentration in the Austin banking market itself. view, I do not believe this reliance is misplaced Approval will establish Applicant, the largest given the large number of studies which have banking organization in Texas, as the second larg­ found a direct relationship between the competitive est banking organization in the Austin market. I structure of a given market and the pricing, con­ must also note that an application has been re­ duct and economic performance of firms operating ceived by the Board from the second largest bank­ in that market. In my view, the analytical linkages ing organization in Texas to acquire the third between structure, conduct and performance pro­ largest bank in the Austin market. If that applica­ duce economic predictions fully adequate for the tion and the present one were both approved, the Board’s responsibilities under the Bank Holding chances of the Austin market becoming less con­ Company Act and place the burden upon the centrated and more competitive in the future would applicant to come forward with an affirmative be significantly reduced. showing which would contradict these predictions. I am also concerned that the proposed acquisi­ The Applicant in this case has not done so. tion will produce significant adverse effects on While my primary concern is the adverse effect potential competition. The Austin market is highly this acquisition would have in the Austin market, concentrated and Applicant, as one of the largest I am also concerned about the implications this organizations in Texas, is viewed as one of the approval would have for market structure in Texas most likely entrants into the Austin market given generally. During the early 1970’s, bank holding its past expansion history. This is especially true companies in Texas engaged in an intensive round given Applicant’s prior attempt to acquire the of consolidations and acquisitions. With the largest bank in Austin. Besides the possibility of upswing in economic activity and improvement in entering the market de novo, which must be market conditions, the major bank holding com­ viewed as a strong probability given the attracti­ panies appear poised for another round of acquisi­ veness of the Austin market, there are numerous tion activity. While not rigidly adhering to the smaller banks in the Austin market, some of them so-called “Tyler Doctrine” which would prevent in the city of Austin, suitable as foothold entry any of the four first-tier holding companies from points. Given Applicant’s history of increasing the acquiring the largest banks in any of the secondary market shares of its acquired banks, such foothold markets, I would look more favorably upon such or de novo entry should have the pro-competitive acquisitions by the second-tier holding companies effect of decreasing concentration in the Austin or the larger independent banks. Such activity by market. A smaller acquisition would also leave the the smaller banking organizations in Texas would Austin bank as a possible entry point for one of tend to decrease the absolute size disparity be­ the State’s smaller bank holding companies or tween the largest organizations and the rest of the independent banks wishing to form a holding State’s organizations, thereby increasing the num­ company, or leave the Austin bank free to expand ber of effective competitors in Texas and increas­ on its own. ing competition within the State. Additionally, Worth noting also is the fact that this acquisition Austin is the largest of the secondary markets in is within the Justice Department’s “Merger Texas and would provide a key entry point for Guidelines.” Those guidelines state that the one of the smaller organizations in Texas not Department will ordinarily challenge a conglom­ represented in that market. Such growth by the erate merger (a market extension acquisition) be­ smaller Texas organizations would greatly increase tween one of the most likely entrants into a market the amount of financial expertise and capabilities and “one of the four largest firms in a market available to meet the expanding banking needs of in which the shares of the eight largest firms Texas. amount to approximately 75 per cent or more, For the foregoing reasons, I would deny this provided the merging firm’s share of the market application. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

504 Federal Reserve Bulletin □ May 1977 Texas Commerce Bancshares, Inc., between Bank and Applicant’s banking subsidi­ Houston, Texas aries in the market.3 Bank ranks among the top 5 per cent of all Texas Order Denying Acquisition of Bank banks in deposit size4 and is the largest inde­ Texas Commerce Bancshares, Inc., Houston, pendent bank in the San Antonio banking market, Texas, a bank holding company within the mean­ more than twice the size of the largest remaining ing of the Bank Holding Company Act, has ap­ independent bank in downtown San Antonio; thus, plied for the Board’s approval under § 3(a)(3) of approval of the proposal would remove an attrac­ the Act (12 U.S.C. § 1842 (a)(3)) to acquire 100 tive entry vehicle for a Texas bank holding com­ per cent of the voting shares (less directors’ quali­ pany not currently represented in the growing San fying shares) of Bexar County National Bank of Antonio market.5 Approval would also lessen the San Antonio, San Antonio, Texas (“Bank”). possibility of future market deconcentration Notice of the application, affording opportunity through the entry of another banking organization for interested persons to submit comments and into the market. On the basis of the foregoing and views, has been given in accordance with § 3(b) other facts of record, the Board concludes that of the Act. The time for filing comments and views approval of the application would have signifi­ has expired, and the Board has considered the cantly adverse competitive effects. application and all comments received, including In acting upon this application, the Board has those of the United States Department of Justice, considered the comments of the Department of in light of the factors set forth in § 3(c) of the Justice and Applicant’s responses thereto. The Act (12 U.S.C. § 1842(c)). Justice Department indicated that, in its opinion, Applicant, the largest banking organization in the proposed acquisition would have an adverse Texas, controls 32 banks with aggregate deposits competitive effect since it would eliminate existing of approximately $3.7 billion, representing 7.6 per competition to a significant degree, eliminate the cent of the total commercial bank deposits in the potential for increased competition between Ap­ State.1 Acquisition of Bank ($126.7 million in plicant and Bank, and lead to a significant increase deposits) would increase Applicant’s share of in the concentration of commercial banking in the Statewide deposits by 0.2 per cent and would not San Antonio area, and, more specifically, within result in a significant increase in the concentration Bexar County. Applicant responded that existing of banking resources in Texas. competition between Applicant and Bank was de Bank is the fourth largest of 44 banking organi­ minimis since Applicant’s closest banking subsidi­ zations operating in the San Antonio banking ary, Highland Park State Bank, is a suburban retail market, controlling 4.8 per cent of market depos­ bank while Bank is a downtown commercial bank. its.2 Applicant operates two banks in the San Applicant further contended that the concentration Antonio market and is the eighth largest commer­ ratio of the four largest banks in the San Antonio cial banking organization therein, controlling 4.1 commercial banking market is the lowest in any per cent of market deposits. Thus, consummation principal city in Texas; that no significant increase of the proposal would significantly increase Ap­ in concentration will result from consummation of plicant’s market share, to 8.9 per cent. Further­ the proposal; and, moreover, the concentration more, the facts of record show that one of Appli­ ratio has decreased by 3.4 percentage points since cant’s San Antonio banking subsidiaries is located 1970. Finally, Applicant indicated that consum­ only 3.3 miles southeast of Bank and that approval mation of the proposal would not eliminate the would eliminate significant existing competition potential for increased competition by foreclosing 1 Unless otherwise noted, all banking data are as of Sep­ 3Bank derives 8.9 per cent of its deposits and 16.2 per cent tember 30, 1976, and reflect bank holding company formations of its loans from the service areas of Applicant’s two market and acquisitions approved through April 15, 1977. subsidiaries, Highland Park State Bank and The First National 2The relevant banking market for analyzing the competitive Bank of New Braunfels. effects of the subject proposal is the San Antonio banking 4Bank ranks 34th out of the 1,144 banking organizations market which is approximated by the San Antonio SMSA in Texas as of December 31, 1975. (standard metropolitan statistical area), comprised of Bexar, 5 Between 1970 and 1975 the population of the San Antonio Comal, and Guadalupe Counties. All market data are as of SMSA increased 10.7 per cent while the population of Texas December 31, 1975. increased 8.8 per cent over the same time period. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 505 the possibility that Applicant would establish a de Trust Company of Georgia, novo bank or that Bank would form a holding Atlanta, Georgia company, since Applicant, as a matter of manage­ Order Approving Acquisition of Bank ment policy, has never formed a de novo bank Trust Company of Georgia (“Applicant”), At­ outside the area of metropolitan Houston, and lanta, Georgia, a bank holding company within Bank’s management had considered and rejected the meaning of the Bank Holding Company Act, the possibility of forming its own bank holding has applied for the Board’s approval under section company or becoming affiliated with a smaller 3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to regional bank holding company. acquire all of the voting shares (except directors’ It is the Board’s opinion, however, based on qualifying shares) of the successor by merger to the foregoing and other facts of record, that com­ The First National Bank of Brunswick (“Bank”), petitive considerations relating to this application Brunswick, Georgia. The successor bank into weigh sufficiently against approval so that it should which Bank is to be merged has no significance not be approved unless the anticompetitive effects except as a means of facilitating the acquisition are clearly outweighed by benefits to the public of the voting shares of Bank. Accordingly, the in meeting the convenience and needs of the com­ proposed transaction is treated in this Order as a munities to be served. proposed direct acquisition by Applicant of the The financial and managerial resources and shares of Bank. prospects of Applicant, its subsidiary banks, and Notice of the application, affording opportunity Bank are generally satisfactory. Thus, banking for interested persons to submit comments and factors are consistent with approval of the appli­ views, has been given in accordance with section cation. Considerations relating to the convenience 3(b) of the Act. The time for filing comments and and needs of the communities to be served lend views has expired, and the Board has considered little, if any, weight toward approval. Applicant the application and all comments received in light contends that by affiliation it would provide Bank of the factors set forth in section 3(c) of the Act with the capability of offering full-line wholesale (12 U.S.C. § 1842(c)). banking services, consumer-sized certificates of Applicant, the third largest banking organization deposit, and an extension of Bank’s operating in Georgia, directly controls Trust Company Bank, hours; however, the banking needs of the area are Atlanta, Georgia, which has deposits of $796 currently being met and an array of such services million, and indirectly controls five other banks is already available in the San Antonio market. with aggregate deposits of approximately $400 The Board finds that neither the considerations million.1 The aggregate deposits of Applicant’s relating to banking factors, nor to convenience and existing and approved subsidiary banks represent needs, are sufficient to outweigh the significantly about ten per cent of the total deposits in commer­ adverse competive effects of Applicant’s proposal. cial banks in the State. Acquisition of Bank would Based upon the foregoing and other consid­ increase Applicant’s share of the commercial bank erations reflected in the record, and in light of the deposits in the State by 0.5 per cent, and the Board factors set forth in § 3(c) of the Act, it is the views this increase with a degree of concern be­ Board’s judgment that approval of the proposal cause of the increasing trend toward further con­ would not be in the public interest. Accordingly, centration in the State.2 the application should be, and hereby is, denied for the reasons summarized above. By order of the Board of Governors, effective April 29, 1977. 1 All banking and market data are as of December 31, 1975, unless otherwise noted. Since that date, the Board has approved Applicant’s acquisition of Security National Bank, Smyrna, Georgia, which has deposits of $17.4 million, and its merger Voting for this action: Chairman Burns and Gover­ with Central Bankshares Corporation, Jonesboro, Georgia, the subsidiary bank of which has deposits of $13.7 million. This nors Jackson, Partee, and Lilly. Abstaining: Governor expansion has occurred in part because of more permissive Coldwell. Absent and not voting: Vice Chairman State bank holding company legislation that became effective Gardner and Governor Wallich. in July 1976. 2Georgia’s three largest banking organizations, including both existing and approved bank subsidiaries, presently control approximately 44 per cent of State deposits, and applications (Signed) Griffith L. Garwood, by those organizations now pending would add 1.7 per cent [seal] Deputy Secretary of the Board. to that figure, if approved. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

506 Federal Reserve Bulletin □ May 1977 Bank is the largest of three banking organi­ would be in the public interest and that the appli­ zations in the relevant banking market3 and holds cation should be approved. deposits of $57.2 million, representing approxi­ Accordingly, the application is approved on the mately 51 per cent of the total deposits in com­ basis of the record and for the reasons summarized mercial banks in the market. The other two banks above. The transaction shall not be consummated in the market hold about 36 and 13 per cent of before the thirtieth calendar day following the the market’s deposits, respectively. Applicant’s effective date of this Order or later than three nearest existing or proposed subsidiary bank is months after the effective date of this Order, unless located almost 75 miles from Bank, and it appears such period is extended for good cause by the that this acquisition will eliminate no significant Board, or by the Federal Reserve Bank of Atlanta existing competition between Bank and Appli­ pursuant to delegated authority. cant’s bank and nonbank subsidiaries. Although By order of the Board of Governors, effective Applicant has sufficient resources to enter the April 1, 1977. Brunswick banking market de novo, Georgia law Voting for this action: Governors Wallich, Coldwell, prohibits Applicant from branching into or acqui­ Jackson, Partee, and Lilly. Absent and not voting: ring a de novo bank in the relevant banking mar­ Chairman Burns and Governor Gardner. ket. In bypassing a small existing bank as (Signed) G riffith L. G arw ood, a market entry vehicle, however, Applicant will [seal] Deputy Secretary of the Board. add 0.5 per cent to a rising level of Statewide concentration, and will contribute to some extent to an imbalance of the financial resources among Western Michigan Corporation, existing banks in the market by solidifying Bank’s Niles, Michigan position in that market. For these reasons and Order Approving Acquisition of Bank based on the facts of record, the Board concludes that the proposed acquisition would have slightly Western Michigan Corporation, Niles, Michi­ gan, a bank holding company within the meaning adverse effects on competition. of the Bank Holding Company Act, has applied The financial and managerial resources of Ap­ plicant and Bank, and their future prospects, are for the Board’s approval under section 3(a)(3) of regarded as generally satisfactory, and consid­ the Act [12 U.S.C. § 1842(a)(3)] to acquire 100 erations relating to banking factors are consistent per cent of the voting shares (less directors’ quali­ with approval of the application. Applicant intends fying shares) of the successor by merger to The to offer services not now available to Bank’s First National Bank of Cassopolis, Cassopolis, Michigan (“Bank”). The bank into which Bank customers and to strengthen Bank’s management and improve the services presently offered by is to be merged has no significance except as a Bank. Following consummation of the acquisition, means to facilitate the acquisition of the voting Applicant will provide full-time executive person­ shares of Bank. Accordingly, the proposed acqui­ nel for Bank, and will provide Bank’s customers sition of shares of the successor organization is with new services, including corporate trust, in­ treated herein as the proposed acquisition of the vestment management, international banking, and shares of Bank. factoring services. In addition, Bank may be ex­ By Order dated June 30, 1976, the Board of pected to benefit from access to Applicant’s spe­ Governors denied the application of Western cialized expertise in all areas of existing services. Michigan Corporation to acquire Bank [41 Federal These considerations relating to convenience and Register 28361 (1976); 62 Federal Reserve B ul­ needs of the community to be served lend weight letin 624 (1976)]. Thereafter, Applicant filed a toward approval of the application to acquire Request for Reconsideration of the Board’s Order pursuant to section 262.3(g)(5) of the Board’s Bank, and in the Board’s judgment outweigh the slightly adverse effects on competition that might Rules of Procedure [12 CFR § 262.3(g) (5)]. By result from consummation of this proposal. It is Order dated November 26, 1976 [41 Federal Reg­ the Board’s judgment that the proposed acquisition ister 53118 (1976); 62 Federal Reserve B u lletin 1058 (1976)], the Board granted Applicant’s re­ quest for reconsideration of the application. Notice of the Board’s action granting a recon­ sideration of the application and affording an op­ 3The relevant banking market is approximated by Glynn County. portunity for interested persons to submit com­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 507 ments and views, has been given in accordance fact that the Cass County banking market was with section 3(b) of the Act [41 Federal Register regarded by the Board as not being particularly 53118 (1976)]. The time for filing comments and attractive for de novo entry by other banking views has expired, and the Board has considered organizations seeking to gain access thereto. Fur­ the application and all comments received in light thermore, although the Board found that consid­ of the factors set forth in section 3(c) of the Act erations relating to convenience and needs did lend [12 U.S.C. § 1842(c)]. some weight toward approval, the Board con­ Applicant is the 32nd largest banking organi­ cluded that neither of these considerations nor zation in Michigan and through its sole subsidiary those relating to banking factors were sufficient bank, First National Bank of Southwestern Michi­ to outweigh the adverse competitive effects of gan, Niles, Michigan (“FNB”), holds deposits of Applicant’s proposal. approximately $129.0 million, representing 0.4 In requesting reconsideration, Applicant sub­ per cent of the total deposits held by commercial mitted evidence indicating that the relevant bank­ banks in the State.1 Acquisition of Bank would ing market is more appropriately a redefined South increase Applicant’s share of Statewide deposits Bend/Elkhart, Indiana Ranally Metro Area by approximately .05 per cent and would make (“RMA”).3 In the the redefined banking market, Applicant the 29th largest banking organization in Applicant would rank as the sixth largest of twenty Michigan; however, consummation of the pro­ banking organizations and would control total posal would not significantly increase the concen­ market deposits of $107.9 million, representing tration of banking resources in Michigan. approximately 7.1 per cent of the total deposits In its earlier denial Order, the Board determined held by commercial banks in the market. With that the relevant banking market for analyzing the $17.7 million in deposits, Bank would rank as the competitive effects of the proposal was the Cass thirteenth largest banking organization in the rele­ County banking market, which was found to be vant banking market and would control approxi­ approximated by all of Cass County except the mately 1.2 per cent of total market deposits. Ac­ two extreme southwestern townships of Howard quisition of Bank by Applicant would increase and Milton. Based upon such a market definition Applicant’s share of total deposits in the relevant the Board concluded that acquisition of Bank banking market to approximately 8.3 per cent (second largest of five banking organizations in while Applicant’s rank therein would remain un­ the market) by Applicant (fourth largest of five changed. Thus, consummation of the proposal in the market) would have significant adverse would not have the significant adverse effects on effects upon concentration in the relevant banking concentration in the relevant banking market that market because Applicant’s share of market de­ were of concern to the Board in its original Order. posits would increase by 20.1 percentage points Consummation of the proposed transaction to 37.2 per cent and the two-firm concentration would continue to eliminate some existing compe­ ratio would become 75.3 per cent.2 The Board also tition because FNB operates its head office and concluded that consummation of the transaction eight branches within the relevant market and would have adverse effects upon existing compe­ FNB’s nearest office to Bank is located in Dowtition within that market. In addition, approval of agiac, Michigan, 10 miles northwest of Bank. the proposed transaction would have adverse ef­ While consummation of the proposal would fects upon future competition because there would slightly increase the concentration of banking re­ result a reduction in the number of banking alter­ sources in the relevant market and eliminate Bank natives operating in the market and the elimination as both a competitor and a potential entry vehicle of Bank as both a competitor of Applicant and for a Michigan bank holding company not reprea viable entry vehicle for a Michigan bank holding company not represented in the market. This latter factor was even more significant in light of the 3Board staff undertook a systematic review (township by township) of Cass County to determine the correct market and, as a result of this analysis, the Board has determined that the competitive effects of this proposal are more appropriately ‘Unless otherwise indicated, all banking data are as of June analyzed in the Niles, Michigan-South Bend/Elkhart, Indiana 30, 1976, and reflect bank holding company formations and banking market, which is approximated by the South acquisitions approved through March 4, 1977. Bend/Elkhart, Indiana RMA, Cass County, Michigan, and 2Banking data are as of June 30, 1975. Niles, Michigan. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

508 Federal Reserve Bulletin □ May 1977 sented in the market, it now appears that any Dissenting Statement of Governor Jackson adverse effects upon the market’s competitive structure are minimized by the existence of several I would deny the application of Western Michi­ other independent banking alternatives in the mar­ gan Corporation to acquire The First National ket, including the second largest banking organi­ Bank of Cassopolis. It appears from the facts of zation in Michigan. In light of the revised defini­ record that, although consummation of this trans­ tion of the relevant market, the competitive effects action would not significantly increase the con­ of Applicant’s proposal are significantly lessened centration of banking resources in Michigan, it and are not as adverse as they were at the time would have significant adverse effects within the the Board issued its denial Order. It is the Board’s relevant banking market. judgment that, on balance, consummation of Ap­ In the Board’s previous consideration of this plicant’s proposal would have only slightly ad­ application, the facts of record indicated to the verse competitive effects. Board that acquisition of Bank by Applicant would The financial and managerial resources and fu­ have significantly increased Applicant’s share of ture prospects of Applicant, its subsidiary bank, total deposits in the relevant banking market1 from and Bank are regarded as satisfactory and consist­ approximately 17.1 per cent to approximately 37.2 ent with approval of the application. Acquisition per cent and would have resulted in Applicant of Bank by Applicant would enhance Bank’s abil­ becoming the market’s second largest of five ity to compete because Bank currently possesses banking organizations.2 Thus, the two-bank con­ limited capabilities in terms of the banking serv­ centration ratio in the relevant market would have ices that it is able to offer to the residents of the become 75.3 per cent, a significant increase in the areas in which it is operating. As the Board pre­ concentration of banking resources in that market. viously indicated, affiliation with Applicant would Furthermore, in addition to the significant adverse enable Bank to expand its trust department, in­ effects upon market concentration, the proposal crease its lending capacity through loan partici­ would have had adverse effects upon existing pations, upgrade its agricultural loan services, and competition within the Cass County market. It was create new time deposit services and municipal and the Board’s judgment that approval of the transac­ corporate savings programs. In the Board’s view, tion would have resulted in a reduction in the these considerations relating to both the conven­ number of banking alternatives operating in the ience and needs of the community to be served market and would have eliminated Bank as a and the banking factors lend weight toward ap­ viable entry vehicle for a bank holding company proval of the application and are sufficient to not represented in that market. The Board, on the outweigh any slightly adverse competitive effects basis of these and other facts of record, including present in this proposal. Therefore, it is the the denial recommendation of the Department of Board’s judgment that consummation of the pro­ Justice, concluded that approval of the application posed acquisition would be in the public interest would have significant adverse effects upon exist­ and that the application should be approved. ing competition. In addition, the Board concluded On the basis of the record, the application is that the anticompetitive effects of the proposal approved for the reasons summarized above. The were not clearly outweighed by benefits to the transaction shall not be made (a) before the thir­ public in meeting the convenience and needs of tieth calendar day following the effective date of the communities to be served. Accordingly, the this Order or (b) later than three months after the application was denied. effective date of this Order, unless such period The application is being reconsidered by the is extended for good cause by the Board or by Board in light of a revised definition of the relevant the Federal Reserve Bank of Chicago pursuant to banking market, which now will be the Niles, delegated authority. Michigan-South Bend/Elkhart, Indiana banking By order of the Board of Governors, effective April 29, 1977. Voting for this action: Governors Wallich, Coldwell, *The relevant market was approximated by all of Cass County except for the two extreme southwestern townships Partee, and Lilly. Voting against this action: Governor of Howard and Milton, which are part of the Niles, Michigan- Jackson. Absent and not voting: Chairman Burns and South Bend/Elkhart, Indiana, banking market. Vice Chairman Gardner. 2At that time, Michigan National Corporation, Bloomfield Hills, Michigan, controlled approximately 38.1 per cent of total (Signed) Griffith L. Garwood, market deposits and ranked as the largest banking organization [seal] Deputy Secretary of the Board. therein. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 509 market. This market has been expanded to include to be served lend some weight toward approval Cass County, including Cassopolis, formerly con­ of the application; however, in my view, they are tained in the Cass County banking market.3 Even not sufficient to outweigh the adverse competitive in light of this revised banking market, I would effects of Applicant’s proposal. deny this application for reasons similar to those Therefore, based upon the above reasons, I expressed above. would deny this application. Applicant would rank as the sixth largest of twenty banking organizations in the new market and would control total market deposits of $107.9 Yoakum County Bancshares, Inc., million, representing approximately 7.1 per cent Denver City, Texas of market deposits. Bank would be the thirteenth Order Approving largest organization in the new market, with total Formation of Bank Holding Company deposits of $17.7 million, representing approxi­ mately 1.2 per cent of total market deposits. Ac­ Yoakum County Bancshares, Inc., Denver City, cordingly, upon consummation of this transaction, Texas, has applied for the Board’s approval under the resulting organization would rank sixth in the § 3(a)(1) of the Bank Holding Company Act (12 new market with 8.3 per cent of market deposits. U.S.C. § 1842(a)(1)) of formation of a bank It is my opinion that competitive factors relating holding company through acquisition of 96.04 per to this application are significantly adverse inas­ cent of the voting shares (less directors’ qualifying much as consummation of the proposed transaction shares) of Yoakum County State Bank, Denver would (1) eliminate significant existing competi­ City, Texas (“Bank”). tion between Applicant’s subsidiary bank and Notice of the application, affording opportunity Bank; (2) eliminate a banking alternative in this for interested persons to submit comments and market; (3) increase market concentration; and (4) views, has been given in accordance with § 3(b) remove Bank as a potential entry vehicle for other of the Act. The time for filing comments and views organizations not currently represented in the has expired, and the Board has considered the market. Of particular significance is the elimina­ application and all comments received in light of tion of existing competition between Applicant and the factors set forth in § 3(c) of the Act (12 U.S.C. Bank in the market inasmuch as Applicant’s sub­ § 1842(c)). sidiary bank derives loans and deposits from Applicant, a nonoperating corporation with no Bank’s service area that represent approximately subsidiaries, was formed for the purpose of be­ 28 and 10 per cent, respectively, of Bank’s total coming a bank holding company through the ac­ loans and deposits. quisition of Bank. Bank has total deposits of $17.8 The application should be denied unless the million, representing .04 per cent of total deposits anticompetitive effects of the proposal are clearly in commercial banks in the State of Texas.1 Bank outweighed in the public interest by the probable is the larger of two commercial banks in the effect of this transaction in meeting the conven­ relevant banking market,2 controlling 74.6 per cent ience and needs of the community to be served. of the deposits therein. The purpose of the pro­ Applicant has indicated that it would provide trust posed transaction is to facilitate the transfer of the services for Bank’s customers, increase Bank’s ownership of shares of Bank from individuals to lending capacity through loan participations, up­ a corporation owned by the same individuals. grade its agricultural loan services, and create new Principals of Applicant are principals of West time deposit services and municipal and corporate Texas Bancorporation, a one-bank holding com­ savings programs. The Board’s majority has con­ pany controlling The First National Bank of Post, cluded that these public benefits outweigh the Post, Texas. First National Bank is located anticompetitive effects of this proposal. I disagree ninety-three miles from Bank in a separate banking with that conclusion. The considerations relating market. In view of the relatively small sizes of to the convenience and needs of the community Bank and First National Bank and the distance 3Evidence in the record indicates that Rand McNally Cor­ poration has redefined the South Bend/Elkhart, Indiana Ranally Metro Area based upon commuting and trade patterns between *A11 deposit data are as of December 31, 1975. Cass County and the Niles, Michigan-South Bend/Elkhart, 2The relevant banking market is approximated by Yoakum Indiana areas, to include Cass County. County. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

510 Federal Reserve Bulletin □ May 1977 between them, consummation of the instant pro­ On the basis of the record, the application is posal will have no adverse effect upon existing approved for the reasons set forth above. The or potential competition nor increase the concen­ transaction shall not be made (a) before the thir­ tration of banking resources in any relevant mar­ tieth calendar day following the effective date of ket. Accordingly, it is concluded that competitive this Order or (b) later than three months after the considerations are consistent with approval of the effective date of this Order, unless such period application. is extended for good cause by the Board or by The Board applies multi-bank holding company the Federal Reserve Bank of Dallas pursuant to standards in assessing the financial and managerial delegated authority. resources and future prospects both of an applicant By order of the Secretary of the Board, acting seeking to become a one-bank holding company, pursuant to delegated authority from the Board of and of its proposed subsidiary bank, where the Governors, effective April 22, 1977. principals of the Applicant are engaged in estab­ (Signed) T heodore E. A llision, lishing a chain of one-bank holding companies.3 [seal] Secretary of the Board. First National Bank appears to be in satisfactory condition, which suggests that Applicant’s principals would conduct the operations of the American General Insurance Company, proposed holding company and of Bank in a satis­ Houston, Texas factory manner. In addition, Applicant has com­ Order Amending Prior Board Order with regard mitted that it will not declare dividends on its to Divestiture of Shares of Texas Commerce common stock unless the debt it will incur to Bancshares, Inc., held by American General In­ purchase shares of Bank is amortized as projected surance Company in the application. Applicant has also committed that, in the event any such dividend is paid, certain By Order of April 11, 1972,1 the Board deter­ capital ratios set forth in the application will be mined that American General Insurance Company maintained. Applicant proposes to service the debt (“American General”), Houston, Texas, had it will incur as a result of the proposed transaction ceased to be a bank holding company for purposes through dividends from Bank over a 12-year pe­ of the Bank Holding Company Act of 1956, as riod. Based on Bank’s past earnings, it appears amended (“Act”). The Board’s determination was that Applicant will be able to meet its annual conditioned upon American General exchanging debt-servicing requirements and maintain Bank’s all voting shares of Texas Commerce Bancshares, capital position. These commitments together with Inc. (“TCB”), Houston, Texas, then held by other commitments by Applicant and Applicant’s American General for a new class of shares of shareholders, individually, which commitments TCB that, while held by American General would are contained in the instant application, cause the be nonvoting. The determination was further con­ considerations relating to banking factors to be ditioned upon American General’s fulfilling four consistent with approval of the application. commitments enumerated in the Board’s Order. It does not appear that the convenience and American General committed to divest itself by needs of the community to be served are not being January 1, 1981, of all nonvoting shares of TCB met currently. Although there will be no immedi­ and to accomplish said divestiture through a public ate change in the services offered by Bank upon offering underwritten by investment bankers under consummation of the proposal, considerations re­ an agreement that no purchaser either directly or lating to the convenience and needs of the com­ indirectly would acquire at the sale shares aggre­ munity to be served are consistent with approval gating more than 2 per cent of the then outstanding of the application. Consummation of the proposed common stock of TCB. American General has transaction is in the public interest and it should exchanged its voting shares of TCB for nonvoting be approved. shares. 3 See the Board’s Order of June 14, 1976, denying the application of Nebraska Banco, Inc., Ord, Nebraska (62 Fed. Res. Bulletin 638 (1976)). ‘58 Federal Reserve Bulletin 487 (1972). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 511 American General has now requested that the Ellis Banking Corporation, Board modify its Order to permit American Gen­ Bradenton, Florida eral to divest itself of the nonvoting TCB shares Order Approving Acquisition of through dividend distributions to American Gen­ Bank and Granting a Requested eral’s common stock shareholders at a rate of not Determination Pursuant to Section 2(g)(3) less than one TCB share for every 100 shares of American General common stock held. American Ellis Banking Corporation, Bradenton, Florida, General has fulfilled the other conditions of the a bank holding company within the meaning of Board’s Order and there is no evidence indicating the Bank Holding Company Act, has applied for that American General has sought to exercise a the Board’s approval under § 3(a)(3) of the Act controlling influence over TCB. American Gen­ (12 U.S.C. § 1842(a)(3)) to acquire 50.1 per cent eral’s common stock is widely held, and it appears or more of the voting shares of the Citizens Bank that no shareholder of American General would of Bunnell, Bunnell, Florida (“Bank”). receive shares of TCB aggregating more than 2 Notice of the application, affording opportunity per cent of the outstanding common stock of for interested persons to submit comments and TCB.2 views, has been given in accordance with § 3(b) On the basis of the facts of record, the Board of the Act. The time for filing comments and views concludes that approval of American General’s has expired, and the Board has considered the request is consistent with the purposes of the Act application and all comments received in light of the Board sought to accomplish in its Order of the factors set forth in § 3(c) of the Act (12 U.S.C. April 11, 1952. Accordingly, the Board’s Order § 1842(c)). of April 11, 1972, is hereby amended to permit Applicant, the tenth largest banking organi­ American General to divest its interest in TCB zation in Florida, controls 25 banks with aggregate through dividend distributions to the common deposits of approximately $692.3 million, repre­ stock shareholders of American General. This senting approximately 2.8 per cent of total com­ amendment is subject to the following conditions: mercial bank deposits in Florida.1 Acquisition of (1) American General will not hold any vot­ Bank (approximately $11.8 million in deposits) ing or nonvoting TCB shares on January 1, would increase Applicant’s share of commercial 1981. bank deposits in Florida by .05 per cent and would (2) American General will dispose of any have no appreciable effect upon the concentration TCB shares received by its subsidiaries or of banking resources in Florida. other shareholders directly or indirectly under Bank, the larger of the two banks in the relevant its control within three months of receipt of market,2 controls total deposits of approximately said shares. $11.8 million, representing about 63 per cent of The Board’s actions herein is subject to amend­ the total deposits in commercial banking institu­ ment, revocation, or nullification by the Board tions in the market. The closest subsidiary bank should it conclude that American General at any of Applicant is located 150 miles south of Bank time exercises or has attempted to exercise control in a separate banking market. Approval of the or a controlling influence over TCB or any of its proposal would eliminate no significant existing subsidiaries. competition between Applicant’s subsidiaries and By order of the Board of Governors, effective Bank. Common ownership and control of Bank April 14, 1977. and the only other bank in the relevant market Voting for this action: Vice Chairman Gardner and has led to common senior operating management Governors Wallich, Coldwell, Jackson, and Partee. and numerous director interlocks. Because of this Absent and not voting: Chairman Burns and Governor relationship, the two banking institutions do not Lilly. presently compete with each other to any mean­ (Signed) R uth A. R eister, ingful extent. If the subject proposal is approved, [seal] Assistant Secretary of the Board. 2 Certain American General subsidiaries and employee and agent benefit plans hold shares of American General’s common stock. American General has indicated that those subsidiaries and benefit plans would promptly resell pursuant to Rule 144 of the Securities and Exchange Commission all shares of TCB *A11 banking data are as of June 30, 1976. stock received in connection with the dividend distributions. 2The relevant market is approximated by Flagler County. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

512 Federal Reserve Bulletin □ May 1977 Applicant has indicated that the present relation­ of controlling the transferee. On the basis of the ship would be terminated and Bank would become facts of record, including submissions from both independent and an alternative source of banking Applicant and Florida National, the Board has services in the relevant market. On the basis of determined, pursuant to § 2(g)(3) of the Act (12 the facts of record, the Board concludes that com­ U.S.C. § 1841(g)(3)), that Florida National will petitive considerations are consistent with, and not in fact be capable of controlling Applicant.4 lend some weight toward, approval of the applica­ Furthermore, upon consummation of this transac­ tion. tion, Florida National will terminate its interest The financial and managerial resources and fu­ in Bank, as required by the Board’s Order of July ture prospects of Applicant and its subsidiaries are 29, 1976. regarded as generally satisfactory. The financial On the basis of the record, the application is and managerial resources and future prospects of approved for the reasons summarized above. The Bank appear satisfactory. Considerations relating transaction shall not be made (a) before the thir­ to banking factors are consistent with approval. tieth calendar day following the effective date of Applicant has indicated that it will provide Bank this Order or (b) later than three months after the with specialized lending expertise and assist it in effective date of this Order, unless such period securing loan participations. Furthermore, affilia­ is extended for good cause by the Board, or by tion with Applicant will provide Bank with access the Federal Reserve Bank of Atlanta pursuant to to Applicant’s centralized auditing, accounting, delegated authority. investment counseling, and management training By order of the Board of Governors, effective program. Considerations relating to the conven­ April 4, 1977. ience and needs of the community to be served, Voting for this action: Governors Wallich, Coldwell, therefore, lend some weight toward approval of Jackson, Partee, and Lilly. Absent and not voting: the application. It is the Board’s judgment that Chairman Burns and Governor Gardner. the proposed acquisition would be in the public (Signed) G riffith L. G arw ood, interest and that the application should be ap­ [seal] Deputy Secretary of the Board. proved. In connection with this proposal, Applicant will offer two types of debt instruments in exchange for Bank’s stock: a seven-year maturity convert­ ible debenture and a ten-year maturity noncon­ Prior Certifications under the vertible debenture. Florida National Banks of Bank Holding Company Tax Act of 1976 Florida, Inc. (“Florida National”), Jacksonville, Helmerich & Payne, Inc., Florida, will exchange the 50.1 per cent of the Tulsa, Oklahoma voting shares it now holds in Bank for the ten-year maturity nonconvertible debentures Applicant is Helmerich & Payne, Inc., Tulsa, Oklahoma offering.3 Under § 2(g)(3) of the Act, shares (“H&P”) has requested a prior certification pur­ transferred after January 1, 1966, by a bank hold­ suant to § 1101(b) of the Internal Revenue Code ing company directly or indirectly to any transferee (the “Code”), as amended by § 2(a) of the Bank that is indebted to the transferor are deemed to Holding Company Tax Act of 1976, that its pro­ be indirectly owned or controlled by the transferor posed divestiture of substantially all of the 85,510 unless the Board, after opportunity for hearing, shares of Utica Bankshares Corporation, Tulsa, determines that the transferor is not in fact capable 4Among the facts of record upon which the Board bases this determination, the Board notes, in particular, that Florida National has no directors or officers in common with Applicant. Florida National will hold nonconvertible debentures totalling 3Officers of Florida National acquired a controlling interest less than 5 per cent of Applicant’s total liabilities and Florida in Bank in 1974. In its Order of July 29, 1976, denying Florida National’s Board of Directors has resolved that it “will not National’s application to acquire control of Bank from its exercise or attempt to exercise any degree or manner of control officers, the Board found that Florida National had violated of Ellis Banking Corporation as long as Florida National is the prior approval requirements of § 3 of the Act, and required the owner or holder of the ten-year maturity nonconvertible Florida National to divest of all direct or indirect interest in debentures of Ellis.” Furthermore, there are no agreements Bank (62 Fed. Res. Bulletin 696). The subject application or understandings between Florida National and Ellis whereby represents the means by which Florida National seeks to Florida National would regain the shares of Bank’s stock it comply with the Board’s Order. has exchanged. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 513 Oklahoma (“Bankshares”), presently held by longer controlled or exercised a controlling influ­ H&P, through the pro rata distribution of such ence over the management or policies of Bank. shares to the common shareholders of H&P, is This conclusion was based in part upon the fact necessary or appropriate to effectuate the policies that H&P still held approximately 23 per cent of of the Bank Holding Company Act (12 U.S.C. § the voting shares of Bank; that three persons who 1841 et. seq.) (“BHC Act”). H&P proposes to were officers or directors of H&P served as direc­ distribute to its shareholders one share of Bank­ tors of Bank; and that no other individual or shares for each 50 shares of H&P held by such organization controlled more than 9 per cent of shareholders. H&P shareholders who would be Bank’s voting stock.2 entitled to fractional interests in Bankshares shares 6. H&P has, continuously since its registration will receive cash in lieu of such fractional inter­ as a bank holding company, remained subject to ests. H&P anticipates that because it will not the BHC Act and has conducted its affairs as a distribute fractional shares, it will, after the distri­ bank holding company. Specifically, on January bution, remain in possession of approximately 0.6 14, 1975, it filed with the Board, and the Board per cent of the total outstanding shares of Bank­ accepted, an irrevocable declaration, pursuant to shares. section 225.4(d) of the Board’s Regulation Y, that In connection with this request, the following it will cease to be a bank holding company by information is deemed relevant, for purposes of January 1, 1981; on March 3, 1975, the Board issuing the requested certification: 1 approved an application filed by H&P as a bank 1. H&P is a corporation organized under the holding company pursuant to section 3(a)(3) of the laws of the State of Delaware on February 3, 1940. BHC Act to acquire control of 22.2 per cent of 2. On July 7, 1970, H&P controlled 36.6 per the voting shares of Bankshares in connection with cent of the outstanding voting shares of Utica the reorganization of Bank into a wholly-owned National Bank and Trust Company, Tulsa, Okla­ subsidiary of Bankshares; and during 1975 and homa (“Bank”). 1976 H&P filed with the Board all of the reports 3. H&P become a bank holding company on required of it under the BHC Act. December 31, 1970, as a result of the 1970 7. H&P has indicated that it will terminate all Amendments to the BHC Act, by virtue of its interlocking relationships between H&P and its control at that time of more than 25 per cent of subsidiaries, on one hand, and Bankshares and its the outstanding voting shares of Bank, and it subsidiaries, including Bank, on the other hand, registered as such with the Board in August 1971. within six months following the distribution of 4. H&P holds property acquired by it on or H&P’s shares of Bankshares. before July 7, 1970, the disposition of which On the basis of the foregoing information, it would be necessary or appropriate to effectuate is hereby certified that: § 4 of the BHC Act if H&P were to continue to (A) H&P is a qualified bank holding corpora­ be a bank holding company beyond December 31, tion, within the meaning of subsection (b) of 1980, which property is “prohibited property” section 1103 of the Code, and satisfies the re­ within the meaning of section 1103(c) of the Code. quirements of that subsection; 5. On or about February 1, 1974, H&P sold (B) the shares of Bankshares that H&P proposes 12,500 shares of voting stock of Bank, thereby to distribute to its shareholders are all or part of reducing to approximately 23 per cent of Bank’s the property by reason of which H&P controls outstanding voting stock the number of shares of (within the meaning of § 2(a) of the BHC Act) such stock controlled by H&P. Subsequent to that a bank or bank holding company; and date, H&P requested a determination by the Board (C) the distribution of such shares is necessary that it was no longer a bank holding company. or appropriate to effectuate the policies of the BHC However, on July 11, 1974, H&P was advised Act. that the Legal Division of the Board and the This certification is based upon the repre­ Federal Reserve Bank of Kansas City had con­ sentations made to the Board by H&P and upon cluded that H&P had not established that it no the facts set forth above. In the event the Board ‘This information derives from H&P’s correspondence with 2In fact, although members of one family owned approxi­ the Board concerning its request for this certification, H&P’s mately 9 per cent of Bank’s voting stock at that time, no single Registration Statement filed with the Board pursuant to the individual or organization controlled more than 5 per cent of BHC Act, and other records of the Board. Bank’s voting stock. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

514 Federal Reserve Bulletin □ May 1977 should hereafter determine that facts material to Bank and Trust Company, Dallas, Texas (“Oak this certification are otherwise than as represented Cliff Bank”). by H&P, or that H&P has failed to disclose to 2. On July 7, 1970, Old Republic Bank indi­ the Board other material facts, it may revoke this rectly controlled, through Howard, a trusteed af­ certification. This certification is granted upon the filiate, property the disposition of which would be condition that no later than six months after the necessary or appropriate to effectuate § 4 of the distribution by H&P of its shares of Bankshares, BHC Act if Old Republic Bank were to continue no person who is an employee with management to be a bank holding company beyond December functions, officer or director (including an advisory 31, 1980, which property is “prohibited property” or honorary director) of H&P or any subsidiary within the meaning of § 1103(c) of the Code. of H&P shall at the same time serve in any such 3. Old Republic Bank became a bank holding capacity with Bankshares or any subsidiary of company on December 31, 1970, as a result of Bankshares, including Bank. the 1970 Amendments to the BHC Act, by virtue By order of the Board of Governors, acting of its indirect control at that time of more than through its General Counsel, pursuant to delegated 25 per cent of the outstanding voting shares of authority, (12 C.F.R. 265.2(b)(3)), effective Oak Cliff Bank, and it registered as such with the March 25, 1977. Board on September 24, 1971. (Signed) Theodore E. A llison, 4. Republic is a corporation that was organized [seal] Secretary of the Board. under the laws of the State of Delaware on July 12, 1972, for the purpose of effecting the reorgan­ ization of Old Republic Bank into a subsidiary of Republic of Texas Corporation, Republic. Dallas, Texas 5. On September 10, 1973, the Board ruled that in the event Republic were to become a bank Republic of Texas Corporation, Dallas, Texas holding company through the acquisition of the (“Republic”) has requested a prior certification successor by merger to Old Republic Bank, pursuant to § 6158(a) of the Internal Revenue Code Republic would not be regarded as a “successor” (the “Code”), as amended by § 3(a) of the Bank to Old Republic as defined in § 2(e) of the BHC Holding Company Tax Act of 1976 (the “Tax Act for the purposes of § 2(a)(6) of the BHC Act, Act”), that the proposed sale by The Howard or as a “company covered in 1970,” as that term Corporation (“Howard”), a subsidiary of Repub­ is defined in the BHC Act, and that Republic was lic, of the Town & Country Shopping Center, not entitled to the benefit of any grandfather privi­ Midland, Texas (“Town & Country) is necessary leges that Old Republic Bank may have possessed or appropriate to effectuate § 4 of the Bank Hold­ pursuant to the proviso in § 4(a)(2) of the BHC ing Company Act (12 U.S.C. § 1843 et seq.) Act. (“BHC Act”). Howard proposes to sell Town & 6. By Order dated October 25, 1973, the Board Country to Hotelmattschappij Duin & Daal B.V., approved Republic’s application under § 3(a)(1) a corporation of Holland, for $1,025,000 cash and of the BHC Act to become a bank holding com­ assumption of the unpaid principal balance owed pany through the acquisition of 100 per cent of by Howard on a note dated March 1, 1966, to the voting shares (less directors’ qualifying shares) The Equitable Life Assurance Association of the of the successor by merger to Old Republic Bank United States. and the indirect acquisition of control of 29.9 per In connection with this request, the following cent of the voting shares of Oak Cliff Bank. information is deemed relevant for purposes of Pursuant to the provisions of § 4(a)(2) of the BHC issuing the requested certification:1 Act, Republic was required by that order to divest 1. On July 7, 1970, Republic National Bank itself, within two years from the date as of which of Dallas (“Old Republic Bank”), a national it would become a bank holding company, of the banking association, indirectly controlled 29.9 per impermissible nonbanking interests that would be cent of the outstanding voting shares of Oak Cliff directly or indirectly controlled by the successor by merger to Old Republic Bank, including such *This information derives from Republic’s correspondence impermissible interests held by Howard. with the Board concerning its request for this certification. 7. On May 9, 1974, in a transaction described Republic’s Registration Statement filed with the Board pursuant in § 368(a)(1)(A) and § 368(a)(2)(D) of the Code, to the BHC Act as well as the Registration Statement of Republic National Bank and other records of the Board. Old Republic Bank was merged into the present Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 515 Republic National Bank of Dallas (“New Republic rial to this certification are otherwise than as rep­ Bank”), a national banking association which was resented by Republic, or that Republic has failed a wholly-owned subsidiary (except for directors’ to disclose to the Board other material facts, it qualifying shares) of Republic. New Republic may revoke this certification. Bank thereby acquired substantially all of the By order of the Board of Governors acting properties of Old Republic Bank and Republic through its General Counsel, pursuant to delegated thereupon became a bank holding company. By authority (12 CFR § 265.2(b)(3)), effective March virtue of two one-year extensions granted by the 30, 1977. Board, Republic presently has until May 9, 1978, (Signed) Theodore E. A llison, to complete the divestitures required by the [seal] Secretary of the Board. Board’s Order of October 25, 1973. 8. As part of the same transaction by which Republic became a bank holding company, in a Republic of Texas Corporation, transaction to which § 351 of the Code applied, Dallas, Texas Republic acquired beneficial interests in the shares Republic of Texas Corporation, Dallas, Texas of Howard held by trustees for the benefit of (“Republic”) has requested a prior certification shareholders of New Republic Bank, which shares pursuant to § 6158(a) of the Internal Revenue Code are shares described in § 2(g)(2) of the BHC Act. (the “Code”), as amended by § 3(a) of the Bank 9. Town & Country was acquired by Howard Holding Company Tax Act of 1976 (the “Tax on November 2, 1965, and is a part of the property Act”), that the proposed sale by The Howard of Howard in which Republic acquired a beneficial Corporation (“Howard”), a subsidiary of Repub­ interest pursuant to § 2(g)(2) of the BHC Act. lic, of the Uptown Shopping Center, Shreveport, On the basis of the foregoing information, it Louisiana (“Uptown”) is necessary or appropriate is hereby certified that: to effectuate § 4 of the Bank Holding Company (A) Prior to May 9, 1974, Old Republic Bank Act (12 U.S.C. § 1843 et seq.) (“BHC Act”). was a “qualified bank holding corporation,” Howard proposes to sell Uptown to Hexalon B.V., within the meaning of subsection (b) of § 1103 a Netherland corporation (“Hexalon”). As con­ of the Code, and satisfied the requirements of that sideration, Hexalon will assume the payment of subsection. the unpaid balances totalling $3,075,000 owed by (B) New Republic Bank is a corporation that Howard on two notes dated May 26, 1966, to acquired substantially all of the properties of a Lincoln National Life Insurance Company. qualified bank holding corporation, and as such In connection with this request, the following is treated as a qualified bank holding corporation information is deemed relevant for purposes of for the purposes of § 6158 of the Code, pursuant issuing the requested certification:1 to § 3(d) of the Tax Act. 1. On July 7, 1970, Republic National Bank (C) Republic is a corporation in control (within of Dallas (“Old Republic Bank”), a national the meaning of § 2(a)(2) of the BHC Act) of New banking association, indirectly controlled 29.9 per Republic Bank, and as such is treated as a qualified cent of the outstanding voting shares of Oak Cliff bank holding corporation for the purposes of § Bank and Trust Company, Dallas, Texas (“Oak 6158 of the Code, pursuant to § 3(d) of the Tax Cliff Bank”). Act. 2. On July 7, 1970, Old Republic Bank indi­ (D) Howard is a subsidiary (within the meaning rectly controlled, through Howard, a trusteed af­ of § 2(d) of the BHC Act) of Republic, and as filiate, property the disposition of which would be such is treated as a qualified bank holding cor­ necessary or appropriate to effectuate § 4 of the poration for the purposes of § 6158 of the Code, BHC Act if Old Republic Bank were to continue pursuant to § 3(d) of the Tax Act. to be a bank holding company beyond December (E) Town & Country is “prohibited property” 31, 1980, which property is “prohibited property” for the purposes of § 6158 of the Code; and within the meaning of § 1103(c) of the Code. (F) The sale of Town & Country is necessary 3. Old Republic Bank became a bank holding or appropriate to effectuate § 4 of the BHC Act. This certification is based upon the repre­ lrThis information derives from Republic’s correspondence sentations made to the Board by Republic and with the Board concerning its request for this certification, Republic’s Registration Statement filed with the Board pursuant upon the facts set forth above. In the event the to the BHC Act as well as the Registration Statement of Board should hereafter determine that facts mate­ Republic National Bank and other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

516 Federal Reserve Bulletin □ May 1977 company on December 31, 1970, as a result of 8. As part of the same transaction by which the 1970 Amendments to the BHC Act, by virtue Republic became a bank holding company, in a of its indirect control at that time of more than transaction to which § 351 of the Code applied, 25 per cent of the outstanding voting shares of Republic acquired beneficial interests in the shares Oak Cliff Bank, and it registered as such with the of Howard held by trustees for the benefit of Board on September 24, 1971. shareholders of new Republic Bank, which shares 4. Republic is a corporation that was organized are shares described in § 2(g)(2) of the BHC Act. under the laws of the State of Delaware on July 9. Uptown was acquired by Howard on May 12, 1972, for the purpose of effecting the reorgan­ 26, 1966, and is a part of the property of Howard ization of Old Republic Bank into a subsidiary of in which Republic acquired a beneficial interest Republic. pursuant to § 2(g)(2) of the BHC Act. 5. On September 10, 1973, the Board ruled that On the basis of the foregoing information, it in the event Republic were to become a bank is hereby certified that: holding company through the acquisition of the (A) Prior to May 9, 1974, Old Republic Bank successor by merger to Old Republic Bank, was a “qualified bank holding corporation,” Republic would not be regarded as a “successor” within the meaning of subsection (b) of § 1103 to Old Republic as defined as § 2(e) of the BHC of the Code, and satisfied the requirements of that Act for the purpose of § 2(a)(6) of the BHC Act, subsection. or as a “company covered in 1970,” as that term (B) New Republic Bank is a corporation that is defined in the BHC Act, and that Republic was acquired substantially all of the properties of a not entitled to the benefit of any grandfather privi­ qualified bank holding corporation, and as such leges that Old Republic Bank may have possessed is treated as a qualified bank holding corporation pursuant to the proviso in § 4(a)(2) of the BHC for the purposes of § 6158 of the Code, pursuant Act. to § 3(d) of the Tax Act. 6. By Order dated October 25, 1973, the Board (C) Republic is a corporation in control (within approved Republic’s application under § 3(a)(1) the meaning of § 2(a)(2) of the BCH Act) of New of the BHC Act to become a bank holding com­ Republic Bank, and as such is treated as a qualified pany through the acquisition of 100 per cent of bank holding corporation for the purposes of § the voting shares (less directors’ qualifying shares) 6158 of the Code, pursuant to § 3(d) of the Tax of the successor by merger to Old Republic Bank Act. and the indirect acquisition of control of 29.9 per (D) Howard is a subsidiary (within the meaning cent of the voting shares of Oak Cliff Bank. of § 2(d) of the BHC Act ) of Republic, and as Pursuant the provisions of § 4(a)(2) of the BHC such is treated as a qualified bank holding cor­ Act, Republic was required by that order to divest poration for the purposes of § 6158 of the Code, itself, within two years from the date as of which pursuant to § 3(d) of the Tax Act. it would become a bank holding company, of the (E) Uptown is “prohibited property” for the impermissible nonbanking interests that would be purposes of § 6158 of the Code; and directly or indirectly controlled by the successor (F) The sale of Uptown is necessary or appro­ by merger to Old Republic Bank, including such priate to effectuate § 4 of the BHC Act. impermissible interests held by Howard. This certification is based upon the repre­ 7. On May 9, 1974, in a transaction described sentations made to the Board by Republic and in § 368(a)(1)(A) and § 368(a)(2)(D) of the Code, upon the facts set forth above. In the event the Old Republic Bank was merged into the present Board should hereafter determine that facts mate­ Republic National Bank of Dallas (“New Republic rial to this certification are otherwise than as rep­ Bank”), a national banking association which was resented by Republic, or that Republic has failed a wholly-owned subsidiary (except for directors’ to disclose to the Board other material facts, it qualifying shares) of Republic. New Republic may revoke this certification. Bank thereby acquired substantially all of the By order of the Board of Governors acting properties of Old Republic Bank and Republic through its General Counsel, pursuant to delegated thereupon became a bank holding company. By authority (12 CFR § 265.2(B)(3)), effective April virtue of two one-year extensions granted by the 15, 1977. Board, Republic presently has until May 9, 1978, to complete the divestitures required by the (Signed) Ruth A. Reister, Board’s Order of October 25, 1973. [seal] Assistant Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 517 ORDERS APPROVED UNDER BANK HOLDING COMPANY ACT By the B oard of G overnors During April 1977, 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 American Bankcorp, The Muskegon Bank 4/29/77 42 F.R. 23206 Inc., Lansing, & Trust Company, 5/6/77 Michigan Muskegon, Michigan Banker Agency, Inc., The Citizens State 4/25/77 42 F.R. 22200 Mohall, North Bank at Mohall, 5/2/77 Dakota Mohal, North Dakota Chemical Financial Gladwin County 4/14/77 42 F.R. 20663 Corporation, Bank, Gladwin, 4/21/77 Midland, Michigan, Beaverton, Michigan Michigan Clevetrust Corpora­ Columbus Trust Com­ 4/5/77 42 F.R. 18898 tion, Cleveland, pany, Columbus, 4/11/77 Ohio Ohio Glen-An Corporation, Farmers State Bank 4/15/77 42 F.R. 20663 Kanaranzi, Minne­ of Kanaranzi, 4/21/77 sota Kanaranzi, Minnesota Montbello Bankcorp, Montbello State 4/7/77 42 F.R. 19512 Inc., Denver, Bank, Denver, 4/14/77 Colorado Colorado Wilber Co., Wilber, Saline State Bank, 4/21/77 42 F.R. 21662 Nebraska Wilber, Nebraska 4/25/77 Woodford Bancorpora- Woodford County 4/20/77 42 F.R. 21662 ation, Inc., El Bank, El Paso, 4/28/77 Paso, Illinois Illinois By Federal Reserve Banks During April 1977, applications were approved by the Federal Reserve Banks as listed below. The orders have been published in the Federal Register, and copies are available upon request to the Reserve Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

518 Federal Reserve Bulletin □ May 1977 Section 3 Federal Reserve Effective Register Applicant Bank(s) Bank date citation First Bankers Cor­ First National Atlanta 4/18/77 42 F.R. 21663 poration of Florida, Bank of Winter 4/28/77 Pompano Beach, Garden, Florida Florida Chemical Financial The Au Gres Chicago 4/20/77 42 F.R. 22201 Corporation, State Bank, 5/2/77 Midland, Michigan Au Gres, Michigan Central Wisconsin Eagle River State Chicago 4/7/77 42 F.R. 20662 Bankshares, Inc., Bank, Eagle 4/21/77 Wausau, Wisconsin River, Wisconsin Valley Bancorporation, The Brownsville Chicago 4/19/77 42 F.R. 22202 Appleton, Wisconsin State Bank, 5/2/77 Brownsville, Wisconsin PENDING CASES INVOLVING THE BOARD OF GOVERNORSH First Security Corporation v. Board of Gover­ of Governors, filed June 1976, U.S.C.A. for nors, filed March 1977, U.S.C.A. for the the Seventh Circuit. Tenth Circuit. National Urban League, et al. v. Office of the Farmers State Bank of Crosby v. Board of Comptroller of the Currency, et al., filed Governors, filed January 1977, U.S.C.A. for April 1976, U.S.D.C. for the District of the Eighth Circuit. Columbia Circuit. National Automobile Dealers Association, Inc. Farmers & Merchants Bank of Las Cruces, v. Board of Governors, filed November 1976, New Mexico v. Board of Governors, filed U.S.C.A. for the District of Columbia. April 1976, U.S.C.A. for the District of First Security Corporation v. Board of Gover­ Columbia Circuit. nors, filed August 1976, U.S.C.A. for the Grandview Bank & Trust Company v. Board Tenth Circuit. of Governors, filed March 1976, U.S.C.A. First State Bank of Clute, Texas, etal. v. Board for the Eighth Circuit. of Governors, filed July 1976, U.S.C.A. for Association of Bank Travel Bureaus, Inc. v. the Fifth Circuit. Board of Governors, filed February 1976, North Lawndale Economic Development Cor­ U.S.C.A. for the Seventh Circuit. poration v. Board of Governors, filed June Memphis Trust Company v. Board of Gover­ 1976, U.S.C.A. for the Seventh Circuit. nors, filed February 1976, U.S.D.C. for the Central Wisconsin Bankshares, Inc. v. Board Western District of Tennessee. First Lincolnwood Corporation v. Board of Governors, filed February 1976, U.S.C.A. for the Seventh Circuit. Roberts Farms, Inc. v. Comptroller of the Cur­ *This list of pending cases does not include suits against rency, et al, filed November 1975, U.S.D.C. the Federal Reserve Banks in which the Board of Governors is not named a party. for the Southern District of California. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 519 National Computer Analysts, Inc. v. Decimus Georgia Association of Insurance Agents, et al. Corporation, et al., filed November 1975, v. Board of Governors, filed October 1974, U.S.D.C. for the District of New Jersey. U.S.C.A. for the Fifth Circuit. Florida Association of Insurance Agents, Inc. Alabama Association of Insurance Agents, et v. Board of Governors, and National Asso­ al. v. Board of Governors, filed July 1974, ciation of Insurance Agents, Inc. v. Board U.S.C.A. for the Fifth Circuit, of Governors, filed August 1975, actions f Consumers Union of the United States, et al. consolidated in U.S.C.A. for the Fifth Cir­ v. Board of Governors, filed September cuit. 1973, U.S.D.C. for the District of Columbia. f %DavidR. Merrill, etal. v. Federal Open Market Bankers Trust New York Corporation v. Board Committee of the Federal Reserve System, of Governors, filed May 1973, U.S.C. A. for filed May 1975, U.S.D.C. for the District of the Second Circuit. Columbia, appeal pending, U.S.D.A. for the District of Columbia. Louis J. Roussel v. Board of Governors, filed tDecision have been handed down in these cases, subject to appeals noted. April 1975, U.S.D.C. for the Eastern District $The Board of Governors is not named as a party in this of Louisiana. action. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

521 Announcements REGULATION T: Amendment language) does not discriminate against borrowers who use another language. The Board of Governors of the Federal Reserve The Board made its rulings in response to re­ System on April 28, 1977, adopted an amendment quests for determinations whether ECOA pre­ to Regulation T (Credit by Brokers and Dealers) empts two California laws. The act authorizes the affecting the trading of stock options. Board to make such determinations if it finds that Such options may be a “call”—an option to a State law is inconsistent with ECOA, but speci­ buy stock at a specified price within a given time, fies that there may be no such pre-emption if the or a “put”—a similar option to sell stock. State law is more protective of credit applicants The Board amended Regulation T to permit a than the Federal law. minor easing of its rules for calculating the margin required on a “straddle” transaction—when both a put and a call in the same stock are held in REGULATION C: the customer’s account. Continued Exemption The Board’s rules at present provide special treatment when puts and calls are issued on the The Board of Governors on May 9, 1977, ap­ same security, with the same expiration date and proved continuance of the exemption that it had the same exercise price. The revision deletes the previously granted to most New York State lenders requirement that both the put and the call must from the disclosure requirements of the Home have the same expiration date and the same exer­ Mortgage Disclosure Act. cise price to qualify for the special margin re­ The Board had granted the exemption last De­ quirement. The margin requirement remains the cember under provisions of the act permitting (30 per cent)1 requirement on either the put or the exemptions when State law imposes home mort­ call, whichever is greater, plus any unrealized loss gage and home improvement loan disclosure re­ on the other option. Certain other technical re­ quirements that are substantially similar to the quirements regarding straddles were adopted. requirements of the Federal law and contain ade­ The new requirements for calculating the margin quate provisions for enforcement. The Federal law on straddles are effective June 1, 1977, to coincide requires lenders covered by the act to disclose the with the beginning of exchange trading of put geographic location of their loans. It is imple­ options recently approved by the Securities and mented by the Board’s Regulation C. Exchange Commission. REGULATION Y: Deferral of Action INTERPRETATIONS The Board of Governors on April 28, 1977, an­ The Board of Governors on April 28, 1977, issued nounced that it had deferred action on the question two interpretations of its Regulation B (Equal whether bank holding companies should be al­ Credit Opportunity) that: (1) clarify when notices lowed to supply management consulting advice to to borrowers required by State law should be depositary institutions other than commercial considered inconsistent with the requirements of banks. the Equal Credit Opportunity Act (ECOA), and The Board deferred action in light of the with­ (2) state that the translation of notices and proce­ drawal last month of an application from a bank dures under ECOA into Spanish (or other foreign holding company (Worcester Bancorp, Inc., Worcester, Mass.) to engage in the activity of supplying management consulting advice to non­ ^he margin requirement generally applicable to purchases or sales of stock on credit is 50 per cent. affiliated savings banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

522 Federal Reserve Bulletin □ M ay 1977 On the basis of the application the Board on reporting commercial banks as shown in the Fed­ August 2, 1976, had announced it would consider eral Reserve Bulletin: possible adoption of a rule to permit bank holding Figures shown for savings deposits of individ­ companies to provide management consulting ad­ uals, partnerships, and corporations (IPC’s) repre­ vice to nonaffiliated savings banks and other non­ sent total savings deposits, not just savings depos­ affiliated depositary institutions. its of IPC’s. Figures labeled “Other” deposits of The Board in 1974 permitted bank holding IPC’s actually are time deposits of this group. The companies to provide certain kinds of management figures for “States and political subdivisions,” consulting advice to nonaffiliated commercial “Domestic interbank,” and “Foreign govern­ banks. ments, official institutions, etc.” represent only time deposits of these groups. (Figures showing ownership categories of savings deposits have PROPOSED AMENDMENTS been shown correctly among the memoranda items.) The Board of Governors has proposed an amend­ The correct nomenclature will be used in the ment to Regulation T (Credit by Brokers and Annual Statistical Digest, 1972-1976, which will Dealers) affecting the trading of stock options. include figures for all large weekly reporting Comments will be received through May 31,1977. banks. Similar information for large commercial The Board has also proposed four simplifying banks in New York City and for large weekly revisions of its Regulation Z (Truth in Lending) reporting banks outside New York City may be to eliminate unnecessary information from the obtained from the Banking Section, Division of Truth in Lending disclosure statement. The Board Research and Statistics, Board of Governors of the will receive comments on these proposals through Federal Reserve System, Washington, D.C. June 15, 1977. 20551. REVISIONS IN EQUAL CREDIT OPPORTUNITY DATA AND NOMENCLATURE PAMPHLETS Call report data for March 31 and June 30, 1976, Two new consumer pamphlets—The Equal Credit which had been published in the Bulletin earlier Opportunity Act and . . . Women and The Equal in 1977, are shown in revised form on pages A70 Credit Opportunity Act and . . . Age—are now and A71 and on pages A18 and A19, respectively, available for distribution. of this issue of the Bulletin. Henceforth, revised The Equal Credit Opportunity Act forbids dis­ figures for a given call date will be shown in the crimination in credit transactions on the basis of Bulletin only if figures for the subsequent call sex, marital status, race, color, religion, national have not become available. In the event that it origin, age, receipt of income from public assist­ does become necessary to revise the data, the ance programs, and good faith exercise of rights revised figures will be made available, as will any under the Consumer Protection Act of 1968 (Truth extensive revisions in other series published by the in Lending, Fair Credit Billing, Equal Credit Op­ Board, in the Board’s Annual Statistical Digest, portunity, Fair Credit Reporting, and Consumer each issue of which will contain all revised data Leasing Acts). available at the time the Digest is published. Copies of the new pamphlets may be obtained Readers’ attention is called to the mislabeling, from any Federal Reserve Bank or from the Board beginning with November 12, 1975, of the fol­ of Governors of the Federal Reserve System, lowing weekly series for deposits of large weekly Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

523 Industrial Production Released for publication May 16 goods materials, output of iron and steel rose sharply for the third successive month. The in­ Industrial production in April increased by an crease in production of nondurable materials was estimated 0.8 per cent, following the 1.4 per cent also large, particularly textiles, paper, and chemi­ gain in March. With the exception of automobiles, cals. relatively large gains in output were widespread in April. Auto production declined, following the Seasonally adjusted, ratio scale, 1967=100 sharp surge in March. At a level of 136.1 per cent 160_ MATERIALS CAPACITY^-''r of the 1967 average, total industrial production in M OU A T T P E U R T IALS April was 6.0 per cent above a year ago and more ''A 1 v \ /r S , _ than 3 per cent above the pre-recession high in -r v^PRODUCTS \J OUTPUT I I June 1974. _ MATERIALS: Nondurable / - Output of durable consumer goods declined - ^ ^J\ /| i. “ slightly in April. Auto assemblies, at an annual ~~ s' / 1 \ / 1 rate of 9.3 million units, were 4 per cent below — V / Ener I gy A / Durable the March rate, reflecting strikes at some motor 1VI P vehicle plants and production adjustments because BUSINESS SUPPLIES^/ of continued relatively large stocks of small-model cars. Production of other consumer durable goods I _ continued to advance strongly, and output of non­ CONSTRUCTION - SUPPLIES | | durable consumer goods picked up. Production of 1969-70=100____Annual rate, millions of units 1967= business equipment increased 0.8 per cent, fol­ 1601 Alimc. O.l_ Ctnolro - MANUFACTURING: 160 lowing a 1.1 per cent rise in March. Output of — Non \ d ura / b i le_ 1i — 140 construction supplies also increased appreciably \ / 1 //V/'v/ last month. - \ f'\ - Durable __ Production of materials increased 1.2 per cent 1 in April, reflecting strong gains in both durable F.R. indexes, seasonally adjusted. Latest figures: April. and nondurable goods materials. Among durable * Auto sales and stocks include imports. Seasonally adjusted, 1967 = 100 Per cent changes from— Industrial production 1977 Jan. Feb. Mar./J Apr/' Month ago Year ago Q4 to Ql Total .................................................................................. 132.1 133.2 135.0 136.1 .8 6.0 1.2 Products, total .......................................................................... 133.1 133.8 135.2 135.8 .4 6.1 1.7 Final products ...................................................................... 130.8 131.7 133.4 134.1 .5 6.2 1.7 Consumer goods ............................................................ 140.2 141.1 143.3 143.8 .3 5.7 1.6 Durable goods .......................................................... 145.1 146.1 153.8 153.4 -.3 8.7 2.4 Nondurable goods .................................................. 138.3 139.0 139.1 140.0 .6 4.5 1.2 Business equipment .................................................... 142.0 143.0 144.6 145.7 .8 8.7 2.4 Intermediate products ...................................................... 141.8 141.7 141.4 142.1 .5 5.5 1.9 Construction supplies .................................................. 136.1 135.7 136.0 136.9 .7 7.0 .6 Materials ..................................................................................... 130.7 132.6 134.7 136.3 1.2 5.5 .7 'Preliminary. '"Estimated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 1 Financial and Business Statistics CONTENTS DOMESTIC FINANCIAL STATISTICS W eekly Reporting Commercial Banks A3 Monetary aggregates and interest rates Assets and Liabilities of— A4 Factors affecting member bank reserves A20 All reporting banks A5 Reserves and borrowings of member A21 Banks in New York City banks A22 Banks outside New York City A6 Federal funds transactions of money A23 Balance sheet memoranda market banks A24 Commercial and industrial loans Policy Instruments A25 Gross demand deposits of individuals, partnerships, and corporations A8 Federal Reserve Bank interest rates A9 Member bank reserve requirements Financial M arkets A10 Maximum interest rates payable on time and savings deposits at Federally A25 Commercial paper and bankers insured institutions acceptances outstanding A10 Margin requirements A26 Prime rate charged by banks on A1 1 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 and Federal Finance rate of turnover A30 Federal fiscal and financing operations A14 Money stock measures and components A31 U.S. Budget receipts and outlays A15 Aggregate reserves and deposits of A32 Federal debt subject to statutory member banks limitation A15 Loans and investments of all A32 Gross public debt of U.S. Treasury— commercial banks Types and ownership A33 U.S. Government marketable Commercial Bank Assets and Liabilities securities—Ownership, by maturity A16 Last-Wednesday-of-month series A34 U.S. Government securities dealers— A17 Call-date series Transactions, positions, and financing A18 Detailed balance sheet, June 30, 1976 A35 Federal and Federally sponsored credit agencies—Debt outstanding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A2 Federal Reserve Bulletin □ M ay 1977 Securities M arkets and Corporate INTERNATIONAL STATISTICS Finance A54 U.S. international transactions— A36 New security issues—State and local Summary government and corporate A55 U.S. foreign trade A37 Corporate securities—Net change in A55 U.S. reserve assets amounts outstanding A56 Selected U.S. liabilities to foreigners A37 Open-end investment companies—Net and to foreign official institutions sales and asset position A3 8 Corporate profits and their distribution Reported by Banks in the United States: A38 Nonfinancial corporations—Assets and A57 Short-term liabilities to foreigners liabilities A59 Long-term liabilities to foreigners A39 Business expenditures on new plant A60 Short-term claims on foreigners and equipment A61 Long-term claims on foreigners Real Estate A62 Foreign branches of U.S. banks— A40 Mortgage markets Balance sheet data A41 Mortgage debt outstanding Securities Holdings and Transactions Consumer Instalment Credit A64 Marketable U.S. Treasury bonds and notes—Foreign holdings and A42 Total outstanding and net change transactions A43 Extensions and liquidations A64 Foreign official accounts A65 Foreign transactions in securities Flow of Funds A44 Funds raised in U.S. credit markets Reported by Nonbanking Concerns in A45 Direct and indirect sources of funds to the United States: credit markets A66 Short-term liabilities to and claims on foreigners DOMESTIC NONFINANCIAL STATISTICS A67 Long-term liabilities to and claims on foreigners A46 Nonfinancial business activity— Selected measures A47 Output, capacity, and capacity Interest and Exchange Rates utilization A68 Discount rates of foreign central banks A47 Labor force, employment, and A68 Foreign short-term interest rates unemployment A68 Foreign exchange rates A48 Industrial production A50 Housing and construction A69 GUIDE TO TABULAR A51 Consumer and wholesale prices PRESENTATION AND A52 Gross national product and income STATISTICAL RELEASES A53 Personal income and saving A70 Commercial bank assets and liabilities: Revised balance sheet, March 31, 1976 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

D om estic Financial Statistics A3 1.10 MONETARY AGGREGATES AND INTEREST RATES 1976 1977 1976 1977 Item Q2 Q3 Q4 Ql Dec. Jan. Feb. Mar. Apr. Monetary and credit aggregates (annual rates of change, seasonally adjusted in per cent)12 Member bank reserves 1 Total............................................................................... 0.6 2.7 4.4 2.7 4.9 10.9 -13.1 -3.1 2 Required........................................................................ 1.1 2.4 4.0 3.0 4.3 11.3 -10.9 -3.7 3 Nonborrowed............................................................... 0.4 2.6 4.8 2.6 5.6 10.4 -13.3 -4.3 Concepts of money 1 4 M-l................................................................................. 8.2 *4.4 r6.8 4.8 r8.5 *■5.8 0.8 6.1 5 M-2................................................................................. 10.5 r9.1 M2.2 9.4 M2.5 *■9.3 *■6.6 8.2 6 M-3................................................................................ 11.8 11.4 r14.2 11.0 *■13.1 *•11.2 *"8.7 9.2 Time and savings deposits Commercial banks: 7 Total........................................................................... 5.4 *7.0 >•11.5 11.3 *■15.9 *•9.8 *•9.7 5.8 8 Other than large CD’s............................................ 12.4 *■12.8 '16.3 12.7 *■15.1 M1.8 *•10.6 9.7 9 Thrift institutions 2..................................................... M3.8 14.8 17.3 13.4 *■14.2 *•14.0 *•11.7 10.4 10 Total loans and investments at commercial banks 3 '8.7 8.9 *■1.7 *■14.5 10.7 Interest rates (levels, per cent per annum) Short-term rates 11 Federal funds 4......................................... 5.19 5.28 4.88 4.66 4.65 4.61 4.68 4.69 4.73 12 Treasury bills (3-month market yield) 5 5.16 5.15 4.67 4.63 4.35 4.62 4.67 4.60 4.54 13 Commercial paper (90- to 119-day) 6.. 5.45 5.41 4.91 4.74 4.66 4.72 4.76 4.75 4.75 14 Federal Reserve discount 7..................... 5.50 5.50 5.39 5.25 5.25 5.25 5.25 5.25 5.25 Long-term rates Bonds: 15 U.S. Govt. 8........................................... 8.01 7.90 7.54 7.62 7.30 7.48 7.64 7.74 7.67 16 Aaa utility (new issue) 9..................... 8.69 8.48 8.15 8.17 7.94 8.08 8.22 8.25 8.26 17 State and local government 10........... 6.78 6.64 6.18 5.88 5.94 5.87 5.89 5.89 5.73 18 Conventional mortgages 11.................... 8.98 9.03 8.95 8.82 8.90 8.80 1 M-l equals currency plus private demand deposits adjusted. 7 Rate for the Federal Reserve Bank of New York. M-2 equals M-l plus bank time and savings deposits other than large 8 Market yields adjusted to a 20-year maturity by the U.S. Treasury. CD’s. 9 Weighted averages of new publicly offered bonds rated Aaa, Aa, and M-3 equals M-2 plus deposits at mutual savings banks, savings and A by Moody’s Investors Service and adjusted to an Aaa basis. Federal loan associations, and credit union shares. Reserve compilations. 2 Savings and loan associations, mutual savings banks, and credit 10 Bond Buyer series for 20 issues of mixed quality. unions. 11 Average rates on new commitments for conventional first mortgages 3 Quarterly changes calculated from figures shown in Table 1.23. 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. 6 Most representative offering rate quoted by five dealers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A4 Domestic Financial Statistics □ M ay 1977 1.11 FACTORS AFFECTING MEMBER BANK RESERVES Millions of dollars Monthly averages of daily Weekly averages of daily figures for weeks ending— figures 1977 1977 Feb. Mar. Apr.*3 Mar. 16 Mar. 23 Mar. 30 Apr. 6 Apr. 13 Apr. 20p Apr. 27? SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding... 109,021 108,085 108,589 105,067 110,019 109,366 105,962 105,822 109,011 111,314 2 U.S. Govt, securities1.................... 95,843 95,310 95,316 92.611 96,758 96,996 93,329 92,673 95,740 97,850 3 Bought outright........................... 94,674 94,313 94,534 92.611 94,865 94,976 93,266 92,311 95,290 96,123 4 Held under repurchase agree­ ment ........................................... 1,169 997 782 1,893 2,020 63 362 450 1,727 5 Federal agency securities,.............. 6,846 6,782 6,813 6.744 6,778 6,815 6,739 6,752 6,748 6,846 6 Bought outright........................... 6,787 6,750 6,766 6.744 6,744 6,744 6,731 6,731 6,731 6,731 7 Held under repurchase agree­ ment ........................................... 59 32 47 34 71 8 21 17 115 8 Acceptances...................................... 330 289 284 174 341 444 167 165 164 419 9 Loans................................................. 79 110 73 24 338 58 65 38 29 99 10 Float................................................... 2,899 2,833 3,023 2,816 3,006 2,171 2,647 3,261 3,233 2,926 11 Other Federal Reserve assets 3,024 2,761 3,080 2,698 2,798 2,883 3,016 2,933 3,097 3,174 12 Gold stock............................................ 11,658 11,646 11,636 11,651 11,647 11,636 11,636 11,636 11,636 11,636 13 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 14 Treasury currency outstanding........ 10,930 10,966 11,014 10,962 10,969 10,986 10,984 11,008 11,014 11,029 absorbing reserve funds 15 Currency in circulation....................... 91,753 92,831 94,298 93,084 93,086 93,013 93,645 94,753 94,657 94,108 16 Treasury cash holdings....................... 499 494 452 504 492 470 466 450 448 447 Deposits, other than member bank reserves with F.R. Banks: 17 Treasury............................................ 10,698 8,577 7,369 5,803 9,800 9,182 5,858 5,279 6,231 9,606 18 Foreign............................................... 294 271 294 301 251 259 284 309 313 272 19 Other 2................................................ 616 669 633 676 649 592 637 650 622 634 20 Other F.R. liabilities and capital----- 3,224 3,206 3,266 3,131 3,273 3,375 3,238 3,113 3,295 3,343 21 Member bank reserves with F.R. Banks................................................. 25,725 25,849 26,127 25,381 26,282 26,296 25,654 25,112 27,296 26,768 End-of-month figures Wednesday figures 1977 1977 Feb. Mar. Apr.? Mar. 16 Mar. 23 Mar. 30 Apr. 6 Apr. 13 Apr. 20^ Apr. 27p SUPPLYING RESERVE FUNDS 22 Reserve Bank credit outstanding.... 108,413 109,468 114,185 103,964 115,261 109,044 101,183 107,915 113,033 114,915 23 U.S. Govt, securities1....................... 95,837 95,987 99,967 90.359 99,864 96.112 86.819 94,329 98,440 100,240 24 Bought outright........................... 94,905 95,547 97,993 90.359 94,855 96.112 86.819 91,794 95,292 97,045 25 Held under repurchase agree­ ment ........................................... 932 440 1,974 5,009 2,535 3,148 3,195 26 Federal agency securities................. 6,844 6,785 7,201 6.744 6,903 6.744 6.731 6,880 6,849 6,900 27 Bought outright........................... 6,767 6,731 7,077 6.744 6,744 6.744 6.731 6,731 6,731 6,731 28 Held under repurchase agree­ ment ........................................... 77 54 124 159 149 118 169 29 Acceptances...................................... 322 280 881 171 460 155 142 320 361 591 30 Loans................................................. 24 271 377 29 2,195 149 36 42 58 486 31 Float.................................................. 2,595 3,286 2,516 3,858 2,918 2,913 4,440 3,204 4,112 3,477 32 Other Federal Reserve assets 2,791 2,859 3,243 2,803 2,921 2,971 3,015 3,140 3,213 3,221 33 Gold stock.......................................... 11,650 11,636 11,636 11,651 11,636 11,636 11,636 11,636 11,636 11,636 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. 10,884 10,939 11,034 10,962 10,979 10,990 10,995 11,012 11,017 11,029 ABSORBING RESERVE FUNDS 36 Currency in circulation.................... 91,697 93,383 94,008 93,382 93,219 93,469 94,538 95,119 94,548 94,345 37 Treasury cash holdings..................... 506 451 443 493 491 471 446 452 443 444 Deposits, other than member bank reserves with F.R. Banks: 38 Treasury.......................................... 12,179 7,150 13,628 4,274 10,764 7,769 7,199 4,790 11,301 11,323 39 Foreign............................................ 362 349 305 243 261 288 237 252 280 266 40 Other 2.............................................. 856 637 591 781 525 563 666 631 740 662 41 Other F.R. liabilities and capital. . 3,630 3,457 3,528 3,191 3,346 3,426 2,992 3,153 3,283 3,410 42 Member bank reserves with F.R. Banks.................................... 22,916 27,814 25,552 25,413 30,470 26,883 18,936 27,367 26,291 28,329 1 Includes securities loaned—fully guaranteed by U.S. Govt, securities voluntarily held with member banks and redeposited in full with Federal pledged with F.R. Banks—and excludes (if any) securities sold and sched­ Reserve Banks. uled to be bought back under matched sale-purchase transactions. Note.—For amounts of currency and coin held as reserves, see Table 2 Includes certain deposits of foreign-owned banking institutions 1.12. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

M em ber Banks A5 1.12 RESERVES AND BORROWINGS Member Banks Millions of dollars Monthly averages of daily figures Reserve classification 1975 1977 Dec. Aug. Sept. Oct. Nov. Jan. Feb. Mar. Apr.? All member banks Reserves: At F.R. Banks................. 27,215 26,001 25,708 26,127 26,458 26,430 27,229 25,725 25,849 26,127 Currency and coin......... 7,773 7,989 8,113 8,025 8,180 8,548 8,913 8,326 8,134 8,374 Total held1....................... 34,989 34,141 33,979 34,305 34,797 35,136 36,290 34,199 34,135 34,649 Required....................... 34,727 33,844 33,692 34,116 34,433 34,964 35,796 34,234 33,870 34,614 Excess1.......................... 262 297 287 189 364 172 494 -35 265 35 Borrowings at F.R. Banks: Total.................................. 127 104 75 66 84 62 61 79 110 73 Seasonal............................ 13 28 31 32 21 12 8 12 13 15 Large banks in New York City 8 Reserves held............................ 6,812 6,559 6,372 6,374 6,589 6,520 7,076 6,442 6,331 6,192 9 Required............................... 6,748 6,501 6,308 6,346 6,485 6,602 6,948 6,537 6,259 6,352 10 Excess.................................... 64 58 64 28 104 -82 128 -95 72 -160 11 Borrowings 2............................. 63 28 22 36 15 6 47 44 16 Large banks in Chicago 12 Reserves held............... 1,740 1,684 1,615 1,648 1,621 1,632 1,731 1.624 1,610 1,626 13 Required................... 1,758 1,625 1,617 1,635 1,602 1,641 1,698 1.624 1,611 1,634 14 Excess....................... -18 59 -2 13 19 -9 33 -1 15 Borrowings2................. 6 3 3 4 2 3 Other large banks 16 Reserves held. .. 13,249 12,610 12,584 12,704 12,889 13,117 13,556 12,683 12,779 12,933 17 Required........ 13,160 12,549 12,521 12,706 12,802 13,053 13,427 12,765 12,705 13,107 18 Excess............. 89 61 63 -2 87 64 129 -82 74 -174 19 Borrowings2.... 26 20 3 17 7 14 25 4 29 25 All other banks 20 Reserves held. 13,188 13,288 13,408 13,579 13,698 13,867 13,927 13,450 13,415 13,634 21 Required... 13,061 13,169 13,246 13,429 13,544 13,668 13,723 13,308 13,295 13,521 22 Excess........ 127 119 162 150 154 199 204 142 120 113 23 Borrowings2.. 38 50 47 46 41 28 28 34 32 Weekly averages of daily figures for weeks ending— 1977 Feb. 23 Mar. 2 Mar. 9 Mar. 16 Mar. 23 Mar. 30 April 6 April 13 April All member banks Reserves: At F.R. Banks..................... 26,416 25,725 25,278 25,381 26,282 26,296 25,654 25,112 27,296 26,768 Currency and coin............. 7,594 8,212 8,181 8,500 7,492 8,290 8,477 8,721 7,751 8,346 Total held1........................... 34,157 34,083 33,607 34,029 33,921 34,737 34,264 33,988 35,198 35,265 Required........................... 33,928 33,933 33,334 33,861 33,844 34,404 34,008 33,714 35,153 35,100 Excess1.............................. 229 150 273 168 77 333 256 274 45 165 Borrowings at F.R. Banks:2 Total...................................... 36 30 20 24 338 58 65 38 29 99 Seasonal................................ 11 12 11 11 13 14 14 12 14 15 Large banks in New York City 31 Reserves held........................... 6,439 6,326 5,993 6,385 6,213 6,485 6,343 6,237 6,420 6,191 32 Required............................... 6,391 6,362 5,988 6,380 6,233 6,401 6,282 6,176 6,597 6,293 33 Excess.................................... 48 -36 5 5 -20 84 61 61 -177 -102 34 Borrowings2............................. 7 167 29 34 Large banks in Chicago 35 Reserves held............... 1,596 1,628 1,621 1,643 1,560 1,659 1,621 1,616 1,663 1,635 36 Required................... 1,621 1,593 1,616 1,631 1,571 1,635 1,594 1,594 1,694 1,621 37 Excess....................... -25 35 5 12 -11 24 27 22 -31 14 38 Borrowings2................ 14 1 1 Other large banks 39 Reserves held. .. 12,709 12,699 12,686 12,623 12,701 13,022 12,802 12,814 13,133 13,320 40 Required........ 12,618 12,730 12,549 12,642 12,659 12,950 12,799 12,788 13,312 13,333 41 Excess............. 91 -31 137 -19 42 72 3 26 -179 -13 42 Borrowings2.... 1 1 1 117 11 1 11 4 27 All other banks 43 Reserves held. 13,413 13,430 13,307 13,378 13,447 13,571 13,498 13,321 13,664 13,951 44 Required... 13,298 13,248 13,181 13,208 13,381 13,418 13,333 13,156 13,550 13,853 45 Excess......... 115 182 126 170 66 153 165 165 114 98 46 Borrowings2.. 29 29 19 23 54 33 34 27 25 37 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 Domestic Financial Statistics □ M ay 1977 1.13 FEDERAL FUNDS TRANSACTIONS of Money Market Banks Millions of dollars, except as noted 1977, week ending— Type Mar. 2 Mar. 9 Mar. 16 Mar. 23 Mar. 30 r April 6 April 13 April 20 April 27 Total, 46 banks Basic reserve position 1 Excess reserves1.................................. 79 124 49 19 126 187 112 -13 3 Less: 2 Borrowings at F.R. Banks........... 241 14 29 11 4 49 3 Net interbank Federal funds transactions............................. 15,664 18,027 18,488 16,396 14,363 17,149 21,273 18,670 14,593 Equals : Net surplus, or deficit ( —): 4 Amount............................................ -15,585 -17,903 -18,439 -16,618 -14,251 -16,990 -21,172 -18,688 -14,639 5 Per cent of average required reserves..................................... 106.3 125.7 125.3 114.5 95.7 116.0 144.9 121.2 97.3 Interbank Federal funds transactions Gross transactions: 6 Purchases......................................... 22,763 24,478 25,141 23,263 22,819 24,728 27,297 26,572 23,441 7 Sales................................................... 7,099 6,451 6,653 6,868 8,457 7,580 6,024 7,902 8,848 8 Two-way transactions2..................... 5,358 4,864 4,620 4,574 5,338 5,268 5,074 5,282 5,463 Net transactions: 9 Purchases of net buying banks... 17,405 19,614 20,521 18,689 17,481 19,460 22,223 21,290 17,978 10 Sales of net selling banks............. 1,741 1,588 2,034 2,293 3,118 2,311 951 2,260 3,384 Related transactions with U.S. Govt, securities dealers 11 Loans to dealers3................................ 2,560 3,489 4,496 2,819 2,469 4,226 5,497 3,632 2,468 12 Borrowing from dealers4................. 2,008 1,829 1,671 1,892 1,895 1,512 1,273 1,248 1,552 13 Net loans.............................................. 553 1,660 2,825 927 574 2,714 4,224 2,384 915 8 banks in New York City Basic reserve position 14 Excess reserves'.................................. -7 -18 -24 51 101 62 15 -20 Less: 15 Borrowings at F R Banks 153 29 34 16 Net interbank Federal funds transactions............................. 4,709 6,353 6,894 4,901 4,984 5,724 7,508 7,135 5,464 Equals : Net surplus, or deficit (—): 17 Amount............................................. -4,716 -6,353 -6,912 -5,079 -4,933 -5,652 -7,445 -7,119 -5,518 18 Per cent of average required reserves..................................... 81.6 117.1 118.7 89.5 84.6 98.9 132.2 118.4 96.6 Interbank Federal funds transactions Gross transactions: 19 Purchases.......................................... 5,807 7,275 6,503 5,936 6,172 6,515 8,156 8,028 6,663 20 Sales................................................... 1,098 922 609 1,035 1,188 791 648 893 1,199 21 Two-way transactions2..................... 1,097 922 609 1,035 1,187 790 648 893 1,199 Net transactions: 22 Purchases of net buying banks... 4,710 6,353 6,894 4,901 4,984 5,724 7,507 7,134 5,464 23 Sales of net selling banks............. Related transactions with U.S. Govt, securities dealers 24 Loans to dealers3................................ 1,611 2,040 2,480 1,593 1,353 1,964 2,482 2,240 1,427 25 Borrowing from dealers4.................. 795 822 788 871 804 611 364 386 491 26 Net loans.............................................. 816 1,218 1,702 722 549 1,353 2,118 1,854 936 38 banks outside New York City Basic reserve position 27 Excess reserves1.................................. 85 124 67 43 75 86 50 -29 22 Less: 28 Borrowings at F R Banks........... 88 14 11 4 14 29 Net interbank Federal funds transactions............................. 10,955 11,674 11,594 11,495 9,379 11,425 13,766 11,536 9,129 Equals : Net surplus, or deficit (—): 30 Amount............................................ -10,869 -11,550 -11,527 -11,539 -9,318 -11,339 -13,727 -11,568 -9,122 31 Per cent of average required reserves ..................................... 122.4 131.0 129.7 130.5 102.8 126.8 152.8 122.9 97.7 Interbank Federal funds transactions Gross transactions: 32 Purchases......................................... 16,956 17,203 17,638 17,328 16,648 18,214 19,141 18,544 16,779 33 Sales................................................... 6,001 5,529 6,044 5,833 7,269 6,789 5,376 7,009 7,649 34 Two-way transactions2..................... 4,260 3,942 4,011 3,539 4,151 4,478 4,425 4,389 4,265 Net transactions: 35 Purchases of net buying banks... 12,696 13,262 13,627 13,788 12,497 13,736 14,716 14,156 12,514 36 Sales of net selling banks............. 1,741 1,588 2,034 2,293 3,118 2,311 951 2,620 3,384 Related transactions with U.S. Govt, securities dealers 37 Loans to dealers3................................ 950 1,449 2,016 1,226 1,117 2,263 3,015 1,392 1,041 38 Borrowing from dealers4.................. 1,213 1,007 893 1,022 1,091 901 909 862 1,062 39 Net loans..'.......................................... -264 442 1,123 205 25 1,361 2,106 530 -21 For notes see end of table. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Funds A l 1.13 Continued 1977, week ending— Type Mar. 2 Mar. 16 Mar. 23 Mar. 30r April 6 April 13 April 20 April 27 5 banks in City of Chicago Basic reserve position 40 Excess reserves1............................ 31 24 44 -7 17 39 40 -24 -4 Less: 41 Borrowings at F.R. Banks. .. 14 42 Net interbank Federal funds transactions....................... 5,972 6,182 6,105 6,136 5,617 6,197 6,662 6,394 5,364 Equals: Net surplus, or deficit (—): 43 Amount.................................... -5,941 -6,158 -6,061 -6,143 -5,615 -6,159 -6,622 -6,418 -5,368 44 Per cent of average required reserves ............................ 399.3 408.0 401.6 419.1 367.4 414.0 445.1 404.0 354.1 Interbank Federal funds transactions Gross transactions: 45 Purchases........................................ 6,893 6,888 6,850 6,794 6,575 7,155 7,528 7,206 6,491 46 Sales................................................ 921 706 745 658 958 958 865 812 1.127 47 Two-way transactions2................... 921 707 745 658 958 958 866 812 1.127 Net transactions: 48 Purchases of net buying banks.. 5,972 6,182 6,105 6,136 5,617 6,197 6,662 6,394 5,364 49 Sales of net selling banks........... Related transactions with U.S. Govt, securities dealers 50 Loans to dealers3................... 205 413 460 310 226 816 611 421 171 51 Borrowing from dealers4.. . 525 412 393 493 481 189 392 444 541 52 Net loans................................. -320 1 67 -183 -255 627 220 -23 -370 33 other banks Basic reserve position 53 Excess reserves1........................... 54 100 22 50 58 48 10 -4 26 Less: 54 Borrowings at F.R. Banks. .. 88 11 4 14 55 Net interbank Federal funds transactions....................... 4,982 5,492 5,489 5,359 3,762 5,227 7,103 5,142 3,766 Equals: Net surplus, or deficit (—): 56 Amount.................................... -4,928 -5,392 -5,466 -5,396 -3,704 -5,180 -7,105 -5,150 -3,754 57 Per cent of average required reserves............................ 66.7 73.8 74.1 73.2 49.1 69.5 94.8 65.8 48.0 Interbank Federal funds transactions Gross transactions: Purchases........................................ 10,063 10,315 10,788 10,533 10,073 11,058 11,614 11,338 10,288 Sales................................................. 5,080 4,823 5,299 5,175 6,311 5,831 4,510 6,196 6,522 Two-way transactions2................... 3,339 3,235 3,266 2,882 3,193 3,520 3,560 3,576 3,137 Net transactions: Purchases of net buying banks.. 6,723 7,080 7,522 7,652 6,880 7,539 8,054 7,762 7,150 Sales of net selling banks........... 1,741 1,588 2,034 2,293 3,118 2,311 951 2,620 3,384 Related transactions with U.S. Govt, securities dealers 63 Loans to dealers3................... 744 1,036 1,555 916 891 1,447 2,403 971 870 64 Borrowing from dealers4. . . 688 595 500 528 611 713 517 418 520 65 Net loans.................................. 57 441 1,056 388 280 734 1,886 554 350 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 □ M ay 1977 1.14 FEDERAL RESERVE BANK INTEREST RATES Per cent per annum Current and previous levels Loans to member banks- Loans to all others Under Sec. 10(b)2 under last par. Sec. 134 Federal Reserve Under Secs. 13 and 13a1 Bank Regular rate Special rate3 Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous 4/30/77 date rate 4/30/77 date rate 4/30/77 date3 rate 4/30/77 date rate Boston.................. 5Va 11/22/76 5% 534 11/22/76 6V4 11/22/76 6Vi 8% 11/22/76 8Vi New York........... 5Ya 11/22/76 51/2 5Va 11/22/76 6% 11/22/76 6 Vi 8V4 11/22/76 8 Vi Philadelphia........ 5Ya 11/22/76 5Vi 5Va 11/22/76 6% 11/22/76 6Vi 8V4 11/22/76 8 Vi Cleveland............. 5% 11122116 51/2 5 Va 11122116 6V4 11/22/76 6Vi 8V4 11/22/76 8% Richmond........... 5V4 11/22/76 5Vi 5 Va 11 /22/76 6V4 11/22/76 6Vi 8% 11/22/76 8 Vi Atlanta................. 5% 11/22/76 5Vi 5Ya 11 /22/76 6% 11/22/76 6% 8V4 11/22/76 8Vi Chicago................ 51/4 11/22/76 5 Vi 5 Va 11/22/76 6% 11/22/76 6 Vi 8V4 11/22/76 8 Vi St. Louis.............. 5% 11/26/76 5% 5Ya 11 /26/16 6% 11/26/76 6Vi 8% 11/26/76 8% Minneapolis........ 5% 11/22/76 5% 5Va U/22/16 6% 11/22/76 6Vi 8% 11/22/76 8 Vi Kansas City........ SV4 11/22/76 5Vi 5Va 11/22/76 6V4 11/22/76 6 Vi 8V4 11/22/76 8Vi Dallas................... 5Ya U/22/16 5 Vi 5Ya 11/22/76 6% 11/22/76 6Vi 8% 11/22/76 8 Vi San Francisco. .. 5% 11122116 5Vi 5 Va 11/22/76 6% 11/22/76 6Vi 8% 11/22/76 8Vi 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, 5 Vi 5Yi 1973—Jan. 15. 5 5 1975—Jan. 6................... 714-734 734 Feb. 26. 5-5 Vi 5Vi 10................... 714-734 7V4 1971—Jan. 8............. 5V4-5Vi 5Ya Mar. 2. 5 Vi 5Vi 24................... 7V4 714 15............. 5% 5Ya Apr. 23. 5V2-5VA 5Vi Feb. 5................... 634-7V4 634 19............. 5 -5V4 5 Va May 4. 534 534 7................... 634 634 22............. 5 -5 Va 5 11. 534-6 6 Mar. 10................... 614-634 614 29............. 5 5 18. 6 6 14................... 614 614 Feb. 13............. 434-5 5 June 11. 6-6 Vi 6Vi May 16................... 6-6V4 6 19............. 434 434 15. 6Vi 61/2 23................... 6 6 July 16............. 434-5 5 July 2. 7 7 2 3 5 5 Aug. 14. 7-7Vi 7 Vi 1976—Jan. 19................... 5Vi-6 5Vi Nov. 11............. 434-5 5 23. 7Vi 71/2 23................... 5Vi 5Vi 19............. 434 43/4 Dec. 13............. 4Vi-434 434 1974—Apr. 25, 71/2-8 8 Nov. 22................... 514-5 Vi 5V4 17............. 4Vi-434 4Vi 30, 8 8 26................... 51/4 514 2 4 4Vi 4Vi Dec. 9, 734-8 <7A 16, IVa IVa In effect Apr. 30, 1977... 514 5V4 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 Secs. 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 Instrum ents A9 1.15 MEMBER BANK RESERVE REQUIREMENTS1 Per cent of deposits Requirements in effect Previous requirements Apr. 30, 1977 Type of deposit, and deposit interval in millions of dollars Per cent Effective date Per cent Effective date Net demand:2 7 12/30/76 71/2 2/13/75 91/2 12/30/76 10 2/13/75 10-100..................................................................................................... 1134 12/30/76 12 2/13/75 100-400................................................................................................... 1234 12/30/76 13 2/13/75 1614 12/30/76 I6V2 2/13/75 Time:2,3 3 3/16/67 3 % 3/2/67 Other time: 0-5, maturing in— 30-179 days................................................................................... 3 3/16/67 3Vi 3/2/67 180 days to 4 years...................................................................... 4 21/2 1/8/76 3 3/16/67 4 1 10/30/75 3 3/16/67 Over 5, maturing in— 6 12/12/74 5 10/1/70 421/2 1/8/76 3 12/12/74 4 1 10/30/75 3 12/12/74 Legal limits, Apr. 30, 1977 Minimum Maximum Net demand: Reserve city banks................................................................................ 10 22 7 14 3 10 1 For changes in reserve requirements beginning 1963, see Board’s (c) Member banks are required under the Board’s Regulation M to Annual Statistical Digest, 1971-1975 and for prior changes, see Board’s maintain reserves against foreign branch deposits computed on the basis Annual Report for 1975, 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 Financial Statistics □ M ay 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 Apr. 30, 1977 Previous maximum In effect Apr. 30, 1977 Previous maximum Per cent Effective Per cent Effective Per cent Effective Per cent Effective date date date date 1 Savings............................................................. 5 7/1/73 4 Vi 1/21/70 5Va (4) 5 (5) 2 Negotiable order of withdrawal (NOW) accounts1............................................ 5 1/1/74 5 1/1/74 Time (multiple- and single-maturity unless otherwise indicated):2 30-89 days: 3 Multiple-maturity................................. 1 5 7/1/73 / \ 4 5 i/2 9 1 / / 2 2 6 1 / / 6 7 6 0 } (6) (6) 90 days to 1 year: 5 6 S M in u g lt l i e p - l m e- a m tu a r t i u ty ri . t .. y .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . } 5'A 7/1/73 5 * ( / 9 7 / / 2 2 6 0 / / 6 6 6 6 } 3 53,4 (4) 5Va 1/21/70 7 8 2 1 t t o o 2 2 V y i e a y r e s a 3 rs .. 3 .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ } 6 7/1/73 J 5 5 V V a i 1 1 / / 2 2 1 1 / / 7 7 0 0 } 6 Vi (4) I } 6 53/4 1 1/ / 2 2 1 1 / / 7 7 0 0 9 2 Vi to 4 years............................................. 6 Vi 7/1/73 5V4 1/21/70 6Va (4) 6 1/21/70 10 4 to 6 years................................................. IVa 11/1/73 (7) 7Vi 11/1/73 (7) 11 6 years or more.......................................... 7 Vi 12/23/74 IVa 11/1/73 7% 12/23/74 7Vi 11/1/73 12 Governmental units (all maturities).... m 12/23/74 7 Vi 11/27/74 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 2Vi 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. established 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 July 1, 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. 1.161 MARGIN REQUIREMENTS Per cent of market value; effective dates shown. Type of security on sale Mar. 11, 1968 June 8, 1968 May 6, 1970 Dec. 6, 1971 Nov. 24, 1972 Jan. 3, 1974 1 Margin stocks............................................................ 70 80 65 55 65 50 2 Convertible bonds..................................................... 50 60 50 50 50 50 3 Short sales................................................................... 70 80 65 55 65 50 Note.—Regulations G, T, and U of the Federal Reserve Board of difference between the market value (100 per cent) and the maximum Governors, prescribed in accordance with the Securities Exchange Act of loan value. The term “margin stocks” is defined in the corresponding 1934, limit the amount of credit to purchase and carry margin stocks regulation. that may be extended on securities as collateral by prescribing a maximum Regulation G and special margin requirements for bonds convertible loan value, which is a specified percentage of the market value of the into stocks were adopted by the Board of Governors effective Mar. 11, collateral at the time the credit is extended. Margin requirements are the 1968. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instrum ents A l 1 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS Millions of dollars 1976 1977 Type of transaction 1974 1975 1976 Sept. Oct. Nov. Dec. Jan. Feb. Mar. U.S. GOVT. SECURITIES Outright transactions (excl. matched salepurchase transactions) Treasury bills: 1 11,660 11,562 14,343 1,125 618 346 975 2,535 110 9 5,830 5,599 8,462 171 480 1,546 313 801 368 4,550 2 6,431 2 5,017 200 600 Others within 1 year:1 4 450 3,886 472 129 18 59 45 107 41 5 6 -1,183 -4 792 -285 66 1,047 7 252 63 -266 7 131 3,549 1 to 5 years: 8 797 23,284 2 3,202 580 113 681 475 348 174 q 177 10 -697 3,854 -2,588 285 -66 430 -7 -252 -880 266 5 to 10 years: 11 Gross purchases........................................... 434 1,510 1,048 272 62 170 128 151 46 12 Gross sales..................................................... 13 Exchange, or maturity shift....................... 1,675 -4,697 1,572 -1,167 517 Over 10 years: 14 Gross purchases........................................... 196 1,070 642 95 73 119 48 81 37 15 Gross sales..................................................... 16 Exchange or maturity shift....................... 205 848 225 — 310 300 All maturities:1 17 Gross purchases........................................... 13,537 2 21,313 19,707 2,202 618 612 2,004 3,229 797 298 18 Gross sales..................................................... 5,830 5,599 8,639 171 480 1,546 313 801 368 19 Redemptions................................................. 4,682 29,980 2 5,017 200 600 Matched sale-purchase transactions 20 Gross sales......................................................... 64,229 151,205 196,078 19,828 23,289 22,675 23,193 24,595 22,674 30,115 21 Gross purchases............................................... 62,801 152,132 196,579 19,563 24,501 21,525 24,343 22,544 23,447 30,828 Repurchase agreements 22 Gross purchases............................................... 71.333 140,311 232,891 24,108 16,603 17,612 30,872 23,820 13,853 14,368 23 Gross sales......................................................... 70,947 139,538 230,355 23,477 18,821 20,173 27,119 27,573 12,921 14,860 N2e4t change in U.S. Govt, securities................ 1,984 7,434 9,087 2,397 -588 -4,179 5,361 -2,887 1,702 151 FEDERAL AGENCY OBLIGATIONS Outright transactions: 25 Gross purchases............................................... 3,087 1,616 891 115 26 Gross sales......................................................... 27 Redemptions..................................................... 322 246 169 22 14 63 4 24 36 Repurchase agreements: 28 Gross purchases............................................... 23,204 15,179 10,520 1,071 705 897 1,380 930 689 523 29 Gross sales......................................................... 22,735 15,566 10,360 889 949 976 1,102 1,208 612 546 BANKERS ACCEPTANCES 30 Outright transactions, net.................................. 511 163 -545 -55 -9 -9 8 — 5 -18 -19 31 Repurchase agreements, net.............................. 420 -35 410 85 -492 -140 795 -795 149 -23 32 Net change in total System Account......... 6,149 8,539 9,833 2,587 -1,332 -4,307 6,379 -3,969 1,886 50 1 Both gross purchases and redemptions include special certificates amounting to $189 million. Acquisition of these notes is treated as a created when the Treasury borrows directly from the Federal Reserve, 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 in exchange for maturing bills. In 1976 there was a similar transaction 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 Financial Statistics □ M ay 1977 1.18 FEDERAL RESERVE BANKS Condition and F.R. Note Statements Millions of dollars Wednesday End of Month Account 1977 1977 Mar. 30 Apr. 6 Apr. 13 Apr. 2Qp Apr. 27p Feb. Mar. Apr.p Consolidated condition statement ASSETS Gold certificate account.................................. 11,636 11,636 11,636 11,636 11,636 11,651 11,636 11,636 Special Drawing Rights certificate account. 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,200 3 Coin1. 359 340 322 328 327 388 360 340 Loans: Member bank borrowings................. 149 36 42 58 486 24 271 377 Other....................................................... Acceptances: Bought outright.................................... 155 142 134 121 107 173 154 103 Held under repurchase agreements., 186 240 484 149 126 778 Federal agency obligations: Bought outright.................................... 6,744 6,731 6,731 6,731 6,731 6,767 6,731 7,077 Held under repurchase agreements., 149 118 169 77 54 124 U.S. Govt, securities Bought outright: 10 Bills.................................................... 39,735 30,442 35,417 38,915 40,179 38,826 39,170 41,127 11 Certificates—Special....................... 12 Other......................... 13 Notes.................................................. 49,181 49,181 49,181 49,181 49,632 48,920 49,181 49,632 14 Bonds................................................. 7,196 7,196 7,196 7,196 7,234 7,159 7,196 7,234 15 Total 2.................................................... 96,112 86,819 91,794 95,292 97,045 94,905 95,547 97,993 16 Held under repurchase agreements. 2,535 3,148 3,195 932 440 1,974 17 Total U.S. Govt, securities. 96,112 86,819 94,329 98,440 100,240 95,837 95,987 99,967 18 Total loans and securities.. 103,160 93,728 101,571 105,708 108,217 103,027 103,323 108,426 19 Cash items in process of collection__ 8,519 10,544 9,414 10,509 9,661 6,378 8,045 8,015 20 Bank premises.......................................... 373 374 365 366 366 371 372 366 Other assets: 21 Denominated in foreign currencies. 58 59 59 99 64 62 61 56 22 All other................................................ 2,540 2,582 2,716 2,748 2,791 2,358 2,426 2,821 23 Total assets. 127,845 120,463 127,283 132,594 134,262 125,435 127,423 132,860 LIABILITIES 24 F.R. notes.............................................. 83,310 84,329 84,880 84,302 84,088 81,709 83,257 83,757 Deposits: 25 Member bank reserves.................. 26,883 18,936 27,367 26,291 28,329 22,916 27,814 25,552 26 U.S. Treasury—General account. 7,769 7,199 4,790 11,301 11,323 12,179 7,150 13,628 27 Foreign.............................................. 288 237 252 280 266 362 349 305 28 Other 3................................................ 563 666 631 740 662 856 637 591 29 Total deposits. 35,503 27,038 33,040 38,612 40,580 36,313 35,950 40,076 30 Deferred availability cash items............ 5,606 6,104 6,210 6,397 6,184 3,783 4,759 5,499 31 Other liabilities and accrued dividends. 998 900 952 969 979 1,193 1,016 1,052 32 Total liabilities...................................... 125,417 118,371 125,082 130,280 131,831 122,998 124,982 130,384 CAPITAL ACCOUNTS 33 Capital paid in............................................................. 990 991 990 992 991 989 991 993 34 Surplus.......................................................................... 983 983 983 983 983 983 983 983 35 Other capital accounts.............................................. 455 118 228 339 457 465 467 500 36 Total liabilities and capital accounts....................... 127,845 120,463 127,283 132,594 134,262 125,435 127,423 132,860 37 Memo: Marketable U.S. Govt, securities held in custody for foreign and inti, account............... 56,409 57,609 57,626 58,238 57,976 53,991 56,623 60,092 Federal Reserve note statement 38 F.R. notes outstanding (issued to Bank)........ 88,563 88,805 89,250 89,503 89,565 88,205 88,664 89,630 Collateral held against notes outstanding: 39 Gold certificate account.................................. 11,634 11,633 11,634 11,634 11,631 11,645 11,633 11,631 40 Special Drawing Rights certificate account.... 643 643 643 643 643 643 643 643 41 Acceptances....................................................... 42 U.S. Govt, securities........................................ 78,130 78,073 78,543 78,693 78,833 78,030 78,130 78,933 43 Total collateral. 90,407 90,349 90,820 90,970 91,107 90,318 90,406 91,207 1 Effective Jan. 1, 1977 Federal Reserve notes of other Federal Reserve owned banking institutions voluntarily held with member banks and Banks were merged into the liability account for Federal Reserve notes. redeposited in full with F.R. Banks. 2 Includes securities loaned—fully guaranteed by U.S. Govt, securities pledged with F.R. Banks—and excludes (if any) securities sold and Note.—Beginning Jan. 1, 1977 Operating equipment was transferred to scheduled to be bought back under matched sale-purchase transactions. Other assets. 3 Includes certain deposits of domestic nonmember banks and foreign- 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 Type and maturity 1977 1977 Mar. 30 April 6 April 13 April 20 April 27 Feb. 28 Mar. 31 April 30 1 149 36 41 58 486 24 270 377 2 Within 15 days.......................................................... 145 31 29 55 481 19 267 371 3 4 5 12 3 5 5 3 6 A 155 142 320 361 591 322 280 881 6 22 78 217 275 516 169 147 812 7 90 41 71 61 56 106 90 51 8 91 days to 1 year....................................................... 43 23 32 25 19 47 43 18 9 U.S. Govt, securities..................................................... 96,112 86,819 94,329 98,440 100,240 95,837 95,987 99,967 10 Within 15 days1........................................................ 5,595 2,525 4,809 7,717 8,483 3,994 3,494 6,259 11 16 days to 90 days.................................................... 20,422 13,343 18,656 19,780 21,096 20,862 20,422 22,770 12 24,218 24,808 24,721 24,800 24,050 25,362 25,928 24,327 13 Over 1 year to 5 years............................................. 30,575 30,841 30,841 30,841 31,168 30,401 30,841 31,168 14 Over 5 years to 10 years......................................... 9,888 9,888 9,888 9,888 9,991 9,841 9,888 9,991 15 Over 10 years............................................................. 5,414 5,414 5,414 5,414 5,452 5,377 5,414 5,452 16 Federal agency obligations.......................................... 6,744 6,731 6,880 6,849 6,900 6,844 6,785 7,201 17 Within 15 days1........................................................ 41 46 195 163 214 247 82 170 18 16 days to 90 days.................................................... 268 282 282 238 289 171 268 289 19 91 days to 1 year....................................................... 1,178 1,137 1,137 1,143 1,092 1,091 1,178 1,091 20 Over 1 year to 5 years............................................. 3,291 3,300 3,300 3,317 3,317 3,358 3,291 3,490 21 Over 5 years to 10 years......................................... 1,206 1,211 1,211 1,233 1,233 1,217 1,206 1,371 22 Over 10 years............................................................. 760 755 755 755 755 760 760 790 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 Monthly data are at seasonally adjusted annual rates. 1976 1977 Standard metropolitan statistical area 1973 1974 1975 Nov. Dec. Jan. Feb. Mar. Debits (billions of dollars)2 1 All 233 SMSA’s............................................................. 18,641.3 22,192.2 23,565.1 '28,049.0 '28,911.0 '29,288.1 '30,148.5 30,415.9 2 New York City.............................................................. 8,097.7 9,931.8 10,970.9 13,495.5 13,835.0 14,411.8 14,898.0 14,612.1 3 232 SMSA’s................................................................... 10,543.6 12,260.6 12,594.2 r14,553.5 '15,076.1 '14,876.3 '15,250.4 15,803.9 4 6 leading SMSA’s other than N.Y.C.1............... 4,462.8 5,152.7 4,937.5 5,693.2 5,917.1 5,864.3 5,887.1 6,155.7 5 226 others................................................................... 6,080.8 7,107.9 7,661.8 r8,860.4 '9,159.0 '9,012.0 '9,363.3 9,648.1 Turnover of deposits (annual rate) 6 All 233 SMSA’s............................................................ 110.2 128.0 131.0 '147.3 '153.5 154.3 153.3 155.1 7 New York City............................................................. 269.8 312.8 351.8 395.1 419.8 443.5 437.3 436.0 8 232 SMSA’s................................................................... 75.8 86.6 84.7 r93.2 r97.0 94.6 93.8 97.2 9 6 leading SMSA’s other than N.Y.C.1............... 115.0 131.8 118.4 131.7 136.9 133.9 129.9 135.2 10 226 others................................................................... 60.6 69.3 71.6 '78.4 '81.7 79.4 '79.9 82.4 1 Boston, Philadelphia, Chicago, Detroit, San Francisco-Oakland, and Note.—Total SMSA’s includes some cities and counties not designated Los Angeles-Long Beach. as SMSA’s. 2 Excludes interbank and U.S. Govt, demand deposit accounts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Financial Statistics □ M ay 1977 1.21 MONEY STOCK MEASURES AND COMPONENTS Billions of dollars, averages of daily figures 1976 1977 1973 1974 1975 Dec. Dec. Dec. Item Sept.r Oct.1 Nov.r Dec.1 Jan.r Feb.r Seasonally adjusted MEASURES i 1 M-l.......................................... 270.5 283.1 294.8 306.9 310.5 310.6 312.8 314.3 314.5 316.1 2 M-2.......................................... 571.4 612.4 664.3 716.3 125.1 731.7 739.3 745.0 749.1 754.2 3 M-3.......................................... 919.6 981.5 rl ,092.6 1,193.9 1,210.5 1,222.8 1,236.1 1.247.6 1,256.6 1,266.2 4 M-4.......................................... 634.4 701.4 746.5 779.4 788.0 794.0 802.6 808.0 812.3 816.3 5 M-5.......................................... 982.5 1,070.5 rl, 174.7 1,257.0 1,272.8 1,285.0 1,299.3 1.310.7 1,319.9 1,328.4 COMPONENTS 6 Currency................................. 61.5 67.8 73.7 79.2 79.8 80.3 80.6 81.3 82.0 82.4 Commercial bank deposits: 7 Demand.............................. 209.0 215.3 221.0 227.7 230.7 230.3 232.1 233.0 232.5 233.7 8 Time and savings............... 363.9 418.3 451.7 472.5 477.5 483.4 489.8 493.8 497.8 500.2 9 Negotiable CD’s2......... 63.0 89.0 82.1 63.1 62.3 62.2 63.3 63.1 63.3 62.2 10 Other............................... 300.9 329.3 369.6 409.4 415.2 421.2 426.5 430.7 434.5 438.0 11 Nonbank thrift institutions3 348.1 369.1 r428.3 477.6 484.8 491.0 496.8 502.6 507.5 512.0 Not seasonally adjusted MEASURES i 12 M-l......................................................... 278.3 291.3 303.2 304.9 309.4 312.5 321.7 320.2 310.4 313.1 13 M-2......................................................... 576.5 617.5 669.3 712.6 722.8 729.4 744.3 749.9 745.6 754.3 14 M-3......................................................... 921.8 983.8 1,094.3 1,188.6 1,204.9 1,215.7 1,236.9 1.250.1 1,251.5 1,267.9 15 M-4......................................................... 640.5 708.0 752.8 111.9 786.9 792.3 808.6 813.0 806.9 815.1 16 M-5......................................................... 985.8 1,074.3 •1,177.7 1,253.9 1,269.0 1,278.6 1,301.2 1.313.2 1,312.7 1,328.7 COMPONENTS 17 Currency............................................... 62.7 69.0 75.1 79.0 79.6 80.8 82.1 80.7 80.9 81.7 Commercial bank deposits: 18 Demand............................................. 215.7 222.2 228.1 225.9 229.8 231.7 239.5 239.5 229.5 231.4 19 Member......................................... 156.5 159.7 162.1 158.9 161.7 162.5 168.4 168.1 161.0 162.1 20 Domestic nonmember................ 56.3 58.5 62.6 63.8 64.9 65.9 67.5 67.9 65.0 65.7 21 Time and savings.............................. 362.2 416.7 449.6 473.0 477.5 479.8 486.9 492.8 496.4 502.0 22 Negotiable CD’s2....................... 64.0 90.5 83.5 65.3 64.2 62.9 64.3 63.1 61.3 60.8 23 Other............................................. 298.2 326.3 366.2 407.8 413.4 416.9 422.6 429.7 435.1 441.2 24 Nonbank thrift institutions3............. 345.3 366.3 r424.9 476.0 482.1 486.3 492.6 500.2 505.9 513.6 25 U.S. Govt, deposits (all commercial banks)............................................ 6.3 4.9 4.1 5.0 4.0 4.1 4.5 3.9 4.1 4.3 1 Composition of the money stock measures is as follows: M-4: M-2 plus large negotiable CD’s. M-5: M-3 plus large negotiable CD’s. M-l: Averages of daily figures for (1) demand deposits of commercial For a description of the latest revisions in the money stock measures’ banks other than domestic interbank and U.S. Govt., less cash items in see “Money Stock Measures Revisions” on pp. 305-306 of the March process of collection and F.R. float; (2) foreign demand balances at F.R. 1977 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-l 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. As of Oct. 31, 1974, “Total loans and investments” of all commercial 2 Loans sold are those sold outright to banks’ own foreign branches, banks were reduced by $1.5 billion in connection with the liquidation nonconsolidated nonbank affiliates of the bank, the banks’ holding of one large bank. Reductions in other items were: “Total loans,” $1.0 company (if not a bank), and nonconsolidated nonbank subsidiaries of billion (of which $0.6 billion was in “Commercial and industrial loans”), the holding company. Prior to Aug. 28, 1974, the institutions included and “Other securities,” $0.5 billion. In late November “Commercial and had been defined somewhat differently, and the reporting panel of banks industrial loans” were increased by $0.1 billion as a result of loan re­ was also different. On the new basis, both “Total loans” and “Com­ classifications at another large bank. mercial and industrial loans” were reduced by about $100 million. 5 Data revised beginning Jan. 1976 to conform with June 1976 call 3 Reclassification of loans reduced these loans by about $1.2 billion report benchmarks. Complete revisions will be published in the Annual as of Mar. 31, 1976. Statistical Digest, 1972-1976. 4 Data beginning June 30, 1974, include one large mutual savings bank that merged with a nonmember commercial bank. As of that date Note.—Data are for last Wednesday of month except for June 30 there were increases of about $500 million in loans, $100 million in and Dec. 31; data are partly or wholly estimated except when June 30 “Other securities,” and $600 million in “Total loans and investments.” and Dec. 31 are call dates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

M onetary Aggregates A15 1.22 AGGREGATE RESERVES AND DEPOSITS Member Banks Billions of dollars, averages of daily figures 1976 1977 Item 1973 1974 1975 Dec. Dec. Dec. Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Seasonally adjusted 1Reserves 1.......................................................................... 34.94 33.60 34.73 34.51 34.34 34.51 34.85 34.95 34.78 34.40 34.31 2 33.64 35.87 34.60 34.41 34.27 34.41 34.78 34.90 34.71 34.33 34,20 3 Reauired........................................................................ 34.64 36.34 34.46 34.31 34.14 34.29 34.59 34.68 34.51 34.20 34,09 4 Deposits subiect to reserve requirements 2................. 442.3 486.2 505.4 514.2 515.6 520.0 524.9 529.6 532.5 532.0 535.2 5 279.2 322.1 337.9 341.7 343.3 346.2 350.2 355.0 357.3 360.1 361.3 Demand: 6 158.1 160.6 164.5 168.6 168.7 170.4 170.7 171.4 172.5 169.5 171.1 7 U.S. Govt.................................................................. 5.0 3.5 3.0 3.9 3.6 3.4 4.0 3.2 2.7 2.5 2.8 8 Deposits plus nondeposit items 3.................................. 448.9 r494.6 513.8 523.1 523.8 529.0 534.0 538.8 540.8 539.5 542.9 Not seasonally adjusted 9 Deposits subject to reserve requirements 2................. 447.5 491.8 510.9 511.3 514.9 518.9 522.5 534.8 537.7 528.7 534.0 10 Time and savings......................................................... 278.5 321.7 337.2 342.7 344.1 346.7 347.6 353.6 357.0 358.4 361.7 Demand: 11 164.0 166.6 170.7 165.9 167.2 169.5 171.9 177.9 177.8 167.2 169.1 12 U.S. Govt.................................................................. 5.0 3.4 3.1 2.7 3.6 2.8 3.0 3.3 2.9 3.1 3.2 13 Deposits plus non deposit items 3.................................. 454.0 500.1 519.3 520.2 523.1 527.9 531.5 544.0 546.0 536.2 541.7 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 and 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; last Wednesday of month except for June 30 and Dec. 31 1976 1977 1973 1974 4 1975 Dec. 31 Dec. 31 Dec. 31 Category Oct. 27 Nov. 24 Dec. 31 Jan. 26 Feb. 23 Mar. 30 Apr. 27 p P P p p p p Seasonally adjusted 1 Loans and investments1........................ 633.4 690.4 721.1 767.6 773.8 774.9 780.5 790.1 797.1 806.4 2 Including loans sold outright2 637.7 695.2 725.5 771.4 777.6 778.7 784.5 794.0 801.1 810.4 Loans: 3 Total.................................................... 449.0 500.2 496.9 525.8 528.4 528.1 535.0 539.3 545.3 551.9 4 Including loans sold outright2. . 453.3 505.0 501.3 529.6 532.2 531.9 539.0 543.2 549.3 555.9 5 Commercial and industrial3.......... 156.4 183.3 176.0 177.2 179.3 178.8 179.9 181.4 183.0 184.8 6 Including loans sold outright2,3 159.0 186.0 178.5 179.6 181.7 181.2 182.5 184.0 185.7 187.6 Investments: 7 U.S. Treasury.................................... 54.5 50.4 79.4 93.8 94.7 96.9 96.1 100.7 102.7 101.9 8 Other.................................................... 129.9 139.8 144.8 148.0 150.7 149.9 149.4 150.1 149.1 152.6 Not seasonally adjusted 647.3 705.6 737.0 765.9 773.5 792.0 778.8 783.8 795.2 803.7 10 Including loans sold outright.............................. 651.6 710.4 741.4 769.7 777.3 795.8 782.8 787.7 799.2 807.7 Loans: 11 Total i........................................................................ 458.5 510.7 507.4 524.7 527.2 539.2 530.1 532.9 542.0 547.7 12 Including loans sold outright2........................ 462.8 515.5 511.8 528.5 531.0 543.0 534.1 536.8 546.0 551.7 13 Commercial and industrial3................................ 159.4 186.8 179.3 176.6 178.6 182.2 177.9 179.6 182.9 185.0 14 Including loans sold outright2,3..................... 162.0 189.5 181.8 179.0 181.0 184.6 180.5 182.2 185.6 187.8 Investments: 15 U.S. Treasury.......................................................... 58.3 54.5 84.1 93.8 97.3 102.1 100.2 101.7 103.8 102.2 16 Other......................................................................... 130.6 140.5 145.5 147.4 149.1 150.7 148.5 149.2 149.4 153.8 For notes see bottom of opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Financial Statistics □ M ay 1977 1.24 COMMERCIAL BANK ASSETS AND LIABILITIES Last-Wednesday-of-Month Series Billions of dollars, except for number of banks 1975 1976 3 1977 Account Dec. 31 July?3 Aug.?7 Sept.** Oct.p Nov.p Dec.*> Jan.? j Feb.* Mar.*> Apr.?3 All commercial 1 Loans and investments............... 775.8 780.6 790.0 798.4 804.9 813.9 834.7 819.7 827.0 836.1 842.0 2 Loans, gross............................ 546.2 544.8 551.6 558.1 563.7 567.6 583.5 571.0 576.1 582.9 586.0 Investments: 3 U.S. Treasury securities. . 84.1 89.9 92.2 93.0 93.8 97.3 101.6 100.2 101.7 103.8 102.2 4 Other.................................... 145.5 146.0 146.2 147.3 147.4 149.1 149.7 148.5 149.2 149.4 153.8 5 Cash assets.................................. 133.6 110.8 108.6 118.0 114.5 123.8 128.0 117.0 123.5 119.3 120.4 6 Currency and coin................. 12.3 12.2 12.0 12.3 12.6 11.8 13.9 12.6 12.3 12.8 13.2 7 Reserves with F.R. Banks.. 26.8 28.0 25.4 29.8 26.4 29.1 29.9 28.6 28.6 26.9 28.2 8 Balances with banks.............. 47.3 33.7 35.5 35.3 35.9 39.5 38.7 36.3 38.5 38.7 38.1 9 Cash items in process of collection.. 47.3 36.8 35.7 40.7 39.6 43.4 45.2 39.5 44.3 40.9 40.9 10 Total assets/total liabilities and capital1.................................... 964.9 939.5 945.8 965.4 967.9 988.4 1,016.2 988.6 1,003.1 1,010.1 1,017.7 11 Deposits....................................... 786.3 765.2 763.5 777.3 782.0 793.4 816.4 796.6 804.8 812.9 815.1 Demand: 12 Interbank............................ 41.8 32.8 33.1 34.9 34.4 39.6 38.8 35.4 36.6 37.6 33.9 13 U.S. Govt............................ 3.1 3.5 3.6 5.7 3.6 3.2 3.3 3.8 3.6 2.9 7.2 14 Other.................................... 278.7 251.8 248.8 254.3 259.5 262.3 277.1 258.6 262.4 261.1 266.0 Time: 15 Interbank............................... 12.0 10.2 9.7 9.6 9.2 9.1 9.2 8.9 8.7 9.0 8.7 16 Other...................................... 450.6 466.9 468.3 473.0 475.2 479.2 487.9 490.0 493.5 502.1 499.4 17 Borrowings.................................... 60.2 66.7 72.2 77.4 75.9 83.5 87.9 81.1 86.0 83.1 86.6 18 Total capital accounts2............... 69.1 72.5 72.9 73.5 74.0 74.4 75.4 75.9 76.3 76.7 77.0 19 Memo: Number of banks.......... 14,633 14,636 14,650 14,656 14,660 14,674 14,671 14,667 14,688 14,685 14,685 Member 20 Loans and investments................ 578.6 572.3 580.3 585.7 590.7 597.6 614.9 600.9 605.9 611.8 614.8 21 Loans, gross.............................. 416.4 407.5 412.9 417.2 421.6 424.1 437.5 426.3 429.9 434.6 435.9 Investments: 22 U.S. Treasury securities . .. 61.5 64.5 66.7 67.0 67.7 70.8 74.3 72.6 73.7 74.9 73.0 23 Other...................................... 100.7 100.3 100.7 101.5 101.4 102.7 103.1 102.0 102.3 102.3 105.8 24 Cash assets, total......................... 108.5 92.3 89.4 98.9 94.9 103.0 107.6 97.7 102.8 100.0 99.4 25 Currency and coin................... 9.2 9.2 9.0 9.2 9.5 8.9 10.5 9.5 9.3 9.6 9.9 26 Reserves with F.R. Banks. . . 26.8 28.0 25.4 29.8 26.4 29.1 29.9 28.6 28.6 26.9 28.2 27 Balances with banks............... 26.9 19.6 20.5 20.6 20.9 23.3 23.5 21.5 22.2 24.0 21.9 28 Cash items in process of collection.. 45.5 35.5 34.4 39.3 38.2 41.8 43.7 38.1 42.7 39.5 39.4 29 Total assets/total liabilities and capital i. .. ................................ 733.6 706.3 710.7 726.8 727.6 744.8 769.1 744.6 755.1 759.7 762.7 30 Deposits......................................... 590.8 565.2 562.3 573.9 576.1 584.8 604.6 587.0 592.0 598.1 597.8 Demand: 31 Interbank............................... 38.6 30.7 30.9 32.7 32.2 37.2 36.4 33.1 34.1 35.3 31.6 32 U.S. Govt.............................. 3.2 2.7 2.8 4.3 2.9 2.4 2.5 3.0 2.7 2.1 5.9 33 Other...................................... 210.8 188.7 185.9 191.0 194.7 196.0 208.6 193.7 196.6 195.9 199.0 Time: 34 10.0 8.2 7.6 7.5 7.1 7.0 7.2 6.8 6.6 6.9 6.6 35 Other...................................... 329.1 334.9 335.1 338.4 339.2 342.1 349.9 350.3 351.9 357.9 354.7 36 Borrowings.................................... 53.6 60.3 65.9 70.6 69.1 76.4 80.4 73.6 78.0 75.3 78.1 37 Total capital accounts2............... 52.1 55.1 55.4 55.7 56.2 56.6 57.3 57.7 57.9 58.1 58.3 38 Memo: Number of banks____ 5,788 5,768 5,772 5,774 5,769 5,767 5,759 5,739 5,740 5,739 5,739 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 na­ against “other assets,” and against “total assets” as well. tional bank in Puerto Rico and one 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, December, 7; 1977-January 8. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Com m ercial Banks A ll 1.25 COMMERCIAL BANK ASSETS AND LIABILITIES Call-Date Series Millions of dollars except for number of banks 1974 1975 1976 1974 1975 1976 Account Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Total insured National (all insured) 1 Loans and investments, Gross.................................. 734,516 736,164 762,400 773,696 428,433 428,167 441,135 443,955 Loans: 2 Gross..................................................................... 541,111 526,272 535,170 539,017 321,466 312,229 315,738 315,624 3 Net......................................................................... (2) (2) (2) 520,970 (2) (2) (2) 305,275 Investments: 4 U.S. Treasury securities.................................... 54,132 67,833 83,629 90,947 29,075 37,606 46,799 49,688 5 Other..................................................................... 139,272 142,060 143,602 143,731 77,892 78,331 78,598 78,642 6 Cash assets.................................................................... 125,375 125,181 128,256 124,072 76,523 75,686 78,026 75,488 7 Total assets/total liabilities1...................................... 906,325 914,781 944,654 942,510 534,207 536,836 553,285 548,697 8 Deposits......................................................................... 741,665 746,348 775,209 776,957 431,039 431,646 447,590 444,251 Demand: 9 U.S. Govt............................................................. 4,799 3,106 3,108 4,622 2,437 1,723 1,788 2,858 10 Interbank.............................................................. 42,587 41,244 40,259 37,503 23,497 21,096 22,305 20,329 11 Other..................................................................... 265,444 261,903 276,384 265,670 154,397 152,576 159,840 152,382 Time: 12 Interbank............................................................. 10,693 10,252 10,733 9,407 6,750 6,804 7,302 5,532 13 Other..................................................................... 418,142 429,844 444,725 459,754 243,959 249,446 256,355 263,148 14 Borrowings................................................................... 55,988 59,310 56,775 63,823 39,603 41,954 40,875 45,183 15 63,039 65,986 68,474 68,989 35,815 37,483 38,969 39,502 16 Memo: Number of banks........................................ 14,216 14,320 14,372 14,373 4,706 4,730 4,741 4,747 State member (all insured) Insured nonmember 17 Loans and investments, Gross.................................. 140,373 134,759 137,620 136,915 165,709 173,238 183,645 192,825 Loans: 18 Gross..................................................................... 108,346 100,968 100,823 98,889 111,300 113,074 118,609 124,503 19 Net......................................................................... (2) (2) (2) 96,037 (2) (2) (2) 119,658 Investments: 20 U.S. Treasury securities.................................... 9,846 12,004 14,720 16,323 15,211 18,223 22,109 24,934 21 Other..................................................................... 22,181 21,787 22,077 21,702 39,199 41,942 42,927 43,387 22 Cash assets................................................................... 30,473 31,466 30,451 30,422 18,380 18,029 19,778 18,161 23 Total assets/total liabilities........................................ 181,683 179,787 180,495 179,645 190,435 198,157 210,874 214,167 24 144,799 141,995 143,409 142,061 165,827 172,707 184,210 190,644 Demand: 25 U.S. Govt............................................................. 746 443 467 869 1,616 940 853 894 26 Interbank.............................................................. 17,565 18,751 16,265 15,834 1,525 1,397 1,689 1,339 27 Other..................................................................... 49,807 48,621 50,984 49,658 61,240 60,706 65,560 63,629 Time: 28 Interbank............................................................. 3,301 2,771 2,712 3,074 642 676 719 799 29 Other..................................................................... 73,380 71,409 72,981 72,624 100,804 108,989 115,389 123,980 30 Borrowings................................................................... 13,247 14,380 12,771 15,300 3,138 2,976 3,128 3,339 31 Total capital accounts................................................. 12,425 12,773 13,105 12,791 14,799 15,730 16,400 16,696 32 Memo: Number of banks........................................ 1,074 1,064 1,046 1,029 8,436 8,526 8,585 8,597 Noninsured nonmember Total nonmember 33 Loans and investments, Gross.................................. 9,981 11,725 13,674 15,905 175,690 184,963 197,319 208,730 Loans: 34 Gross..................................................................... 8,461 9,559 11,283 13,209 119,761 122,633 129,892 137,712 35 Net......................................................................... (2) (2) (2) 13,092 (2) C2) (2) 132,751 Investments: 36 U.S. Treasury securities.................................... 319 358 490 472 15,530 18,581 22,599 25,407 37 1,201 1,808 1,902 2,223 40,400 43,750 44,829 45,610 38 Cash assets................................................................... 2,667 3,534 5,359 4,362 21,047 21,563 25,137 22,524 39 Total assets/total liabilities........................................ 13,616 16,277 20,544 21,271 204,051 214,434 231,418 235,439 40 6,627 8,314 11,323 11,735 172,454 181,021 195,533 202,380 Demand: 41 U.S. Govt............................................................. 8 11 6 4 1,624 951 859 899 42 Interbank.............................................................. 897 1,338 1,552 1,006 2,422 2,735 3,241 2,346 43 Other..................................................................... 2,062 2,124 2,308 2,555 63,302 62,830 67,868 66,184 Time: 44 Interbank............................................................. 803 957 1,291 1,292 1,445 1,633 2,010 2,092 45 2,857 3,883 6,167 6,876 103,661 112,872 121,556 130,857 46 Borrowings................................................................... 2,382 3,110 3,449 3,372 5,520 6,086 6,577 6,711 47 Total capital accounts................................................. 611 570 651 663 15,410 16,300 17,051 17,359 48 Memo: Number of banks........................................ 249 253 261 270 8,685 8,779 8,846 8,867 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 Financial Statistics □ M ay 1977 1.26 COMMERCIAL BANK ASSETS AND LIABILITIES Detailed Balance Sheet, June 30, 1976<« Asset and liability items are shown in millions of dollars. Member banks 1 All Insured Non­ Asset account commercialcommercial Large banks member banks banks banks 1 Total All other New York City of Other City Chicago large 1 128,435 124,072 105,911 28,242 4,699 39,769 33,201 22,524 2 Currency and coin.................................................... 11,984 11,972 8,987 824 184 2,916 5,063 2,997 3 Reserves with F.R. Banks...................................... 28,212 28,212 28,212 5,194 2,174 11,269 9,575 4 Demand balances with banks in United States.. 30,921 28,765 17,838 6,607 286 3,306 7,639 13,083 5 Other balances with banks in United States___ 6,833 6,041 3,818 95 7 1,476 2,240 3,015 6 Balances with banks in foreign countries........... 4,948 3,623 3,179 327 33 1,767 1,052 1,769 7 45,537 45,459 43,877 15,194 2,016 19,035 7,633 1,660 8 Total securities held—Book value............................. 235,836 233,184 165,113 19,743 7,553 51,970 85,847 70,723 9 U.S. Treasury............................................................ 91,420 90,948 66,013 9,810 3,766 21,562 30,875 25,408 10 Other U.S. Govt, agencies...................................... 34,264 33,729 20,706 1,153 348 5,724 13,482 13,558 11 States and political subdivisions........................... 102,994 102,694 74,465 8,349 3,225 23,691 39,201 28,529 12 All other securities................................................... 6,995 5,701 3,849 430 214 965 2,240 3,146 n 162 113 80 29 50 83 14 Trading-account securities....................................... 5,795 5,745 5,654 2,635 678 2,079 261 141 15 U.S. Treasury........................................................ 3,535 3,535 3,507 1,950 494 970 93 28 16 Other U.S. Govt, agencies................................. 665 665 659 248 44 338 28 6 17 States and political subdivisions....................... 1,043 1,043 1,025 335 80 538 73 17 18 All other trading acct. securities....................... 391 391 383 103 60 204 17 8 19 162 113 80 29 50 83 20 Bank investment portfolios...................................... 230,042 227,439 159,460 17,108 6,875 49,891 85,586 70,582 21 U.S. Treasury........................................................ 87,886 87,413 62,506 7,861 3,272 20,592 30,782 25,380 22 Other U.S. Govt, agencies................................. 33,600 33,064 20,048 905 304 5,385 13,454 13,552 23 States and political subdivisions....................... 101,952 101,651 73,440 8,014 3,145 23,153 39,128 28,512 24 All other portfolio securities............................. 6,605 5,310 3,466 328 155 761 2,223 3,138 25 F.R. stock and corporate stock................................ 1,539 1,495 1,244 261 78 457 448 295 26 Federal funds sold and securities resale agreement.. 36,120 34,262 26,819 1,957 1,150 14,082 9,630 9,300 27 Commercial banks.................................................... 30,954 29,471 22,170 1,100 1,016 10,930 9,124 8,784 28 Brokers and dealers................................................. 2,658 2,459 2,376 200 108 1,683 384 283 29 Others.......................................................................... 2,507 2,333 2,273 656 26 1,469 123 234 30 Other loans, gross......................................................... 516,107 504,755 387,695 71,886 20,802 142,307 152,699 128,412 31 Less: Unearned income on loans......................... 12,000 11,941 8,286 560 81 2,736 4,909 3,714 32 Reserves for loan loss.................................. 6,163 6,105 4,916 1,191 331 1,752 1,642 1,248 33 Other loans, net........................................................ 497,944 486,709 374,494 70,136 20,390 137,820 146,148 123,451 Other loans, gross, by category 34 Real estate loans....................................................... 141,964 141,737 100,545 9,737 1,988 35,890 52,930 41,419 35 Construction and land development............... 16,565 16,560 13,584 3,287 532 6,184 3,582 2,981 36 Secured by farmland............................................ 6,355 6,343 2,717 15 14 275 2,413 3,638 37 Secured by residential.......................................... 80,204 80,064 57,631 4,508 922 20,636 31,564 22,573 38 1- to 4-family residences.................................. 75,830 75,696 54,454 4,082 821 19,515 30,036 21,376 39 FHA-insured or VA-guaranteed............... 8,298 8,263 7,151 628 52 3,863 2,608 1,147 40 Conventional................................................. 67,532 67,432 47,303 3,454 769 15,652 27,428 20,229 41 Multifamily residences..................................... 4,374 4,368 3,177 426 101 1,122 1,528 1,197 42 FHA-insured................................................. 412 411 321 126 25 94 77 90 43 3,963 3,957 2,856 300 76 1,028 1,452 1,107 44 Secured by other properties............................... 38,840 38,770 26,613 1,927 521 8,795 15,370 12,227 45 Loans to financial institutions................................. 41,667 36,703 34,742 12,757 4,548 14,488 2,949 6,925 46 To REIT’s and mortgage companies............... 10,726 10,680 10,341 3,967 1,457 4,149 769 384 47 5,182 3,201 2,527 838 138 1,183 369 2,655 48 To banks in foreign countries........................... 8,625 6,076 5,907 2,445 324 2,725 413 2,718 49 To other depositary institutions....................... 1,411 1,346 1,199 194 25 829 151 212 50 To other financial institutions........................... 15,724 15,401 14,768 5,313 2,605 5,602 1,248 956 51 Loans to security brokers and dealers................. 7,743 7,521 7,390 4,807 987 1,462 134 353 52 Other loans to purch./carry securities................. 4,032 4,018 3,373 435 314 1,712 911 659 53 Loans to farmers—except real estate................... 22,174 22,149 12,380 91 135 2,974 9,179 9,795 54 Commercial and industrial loans......................... 174,325 169,286 140,028 35,648 10,435 53,707 40,238 34,297 55 Loans to individuals................................................ 110,393 110,032 77,597 5,620 1,627 26,915 43,435 32,796 56 Instalment loans......................................................... 87,466 87,141 61,239 4,149 916 21,557 34,617 26,227 57 Passenger automobiles.................................... 36,952 36,686 24,066 746 150 7,055 16,115 12,886 58 6,107 6,106 4,320 314 37 1,695 2,273 1,787 59 Credit cards and related plans...................... 12,196 12,193 10,746 1,446 534 5,792 2,973 1,450 60 Charge-account credit cards..................... 9,517 9,516 8,540 1,039 504 4,765 2,232 977 61 Check and revolving credit plans............. 2,680 2,677 2,206 407 30 1,027 741 473 62 15,537 15,527 10,731 301 86 3,787 6,558 4,805 63 Mobile homes............................................... 8,721 8,720 6,238 166 33 2,246 3,793 2,483 64 Other............................................................... 6,816 6,808 4,493 135 52 1,541 2,766 2,323 65 Other instalment loans.................................... 16,674 16,629 11,376 1,341 109 3,228 6,697 5,299 66 Single-payment loans to individuals................ 22,927 22,891 16,358 1,471 711 5,358 8,818 6,569 67 All other loans.......................................................... 13,807 13,309 11,639 2,792 766 5,159 2,922 2,168 68 Total loans and securities, net.................................... 771,439 755,650 567,670 92,096 29,171 204,329 242,074 203,769 69 Direct lease financing................................................... 4,675 4,675 4,455 1,042 128 2,655 630 221 70 Fixed assets—Buildings, furniture, real estate.... 18,585 18,485 13,902 1,745 611 5,486 6,060 4,683 71 Investment in unconsolidated subsidiaries............. 2,107 2,104 2,063 853 160 980 70 44 72 Customer acceptances outstanding........................... 10,681 10,315 9,989 5,461 517 3,741 271 692 73 Other assets................................................................... 27,860 27,210 24,353 9,266 1,627 9,589 3,871 3,507 74 Total assets..................................................................... 963,782 942,510 728,343 138,705 36,912 266,549 286,177 235,440 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Com m ercial Banks A19 1.26 Continued^ Member banks 1 AH Insured Liability or capital commercialcommercial Large banks Nonaccount banks banks member Total banks 1 New York City of Other All other City Chicago large 311,363 307,796 241,932 57,143 9,807 84,664 90,318 69,431 76 Mutual savings banks.............................................. 1,299 1,113 1,014 510 2 211 291 286 77 Other individuals, partnerships, and 236,613 235,546 179,037 31,574 7,268 65,745 74,449 57,577 78 U.S. Govt................................................................... 4,627 4,623 3,728 515 154 1,563 1,496 900 17,336 17,216 12,278 810 155 3,543 7,770 5,058 1,757 1,295 1,250 987 21 225 17 507 30,870 30,573 29,454 14,252 1,781 9,861 3,560 1,416 82 Banks in foreign countries...................................... 6,341 5,817 5,697 4,349 148 1,083 117 644 12,520 11,612 9,477 4,146 278 2,434 2,619 3,043 293,219 285,446 212,755 35,016 13,165 75,212 89,363 80,464 85 Accumulated for personal loan payments........... 171 171 136 13 123 35 86 Mutual savings banks............................................. 481 458 445 266 7 135 36 36 87 Other individuals, partnerships, and corporations...................................................... 227,592 222,515 163,950 24,420 9,494 56,979 73,056 63,643 88 U.S. Govt................................................................... 678 678 550 78 1 251 220 128 89 States and political subdivisions........................... 43,943 43,654 30,740 1,245 1,106 13,268 15,121 13,203 90 Foreign governments, central banks, etc............. 10,143 9,029 8,778 5,381 1,295 2,061 41 1,366 91 Commercial banks in United States..................... 8,082 7,'522 6,797 2,642 1,162 2,309 685 1,285 92 Banks in foreign countries...................................... 2,129 1,419 1,360 984 100 196 80 769 184,111 183,716 131,625 9,994 2,715 47,121 71,796 52,486 94 Individuals and nonprofit organizations............. 175,366 174,981 125,255 9,530 2,611 44,794 68,320 50,111 95 Corporations and other profit organizations. . . 6,049 6,043 4,521 302 95 1,943 2,182 1,529 96 U.S. Govt................................................................... 2,648 2,645 1,805 133 9 373 1,290 843 97 All other..................................................................... 47 47 44 28 11 4 4 98 Total deposits................................................................. 788,694 776,958 586,313 102,153 25,687 206,997 251,476 202,381 99 Federal funds purchased and securities sold under agreements to repurchase.................................. 60,719 58,944 55,906 11,539 7,215 28,994 8,158 4,813 100 Commercial banks................................................. 35,182 33,936 32,667 6,495 4,883 17,324 3,965 2,514 101 Brokers and dealers............................................... 8,053 7,976 7,512 800 1,073 4,837 801 542 102 Others....................................................................... 17,484 17,031 15,727 4,243 1,259 6,833 3,392 1,757 103 Other liabilities for borrowed money..................... 6,477 4,880 4,578 2,249 80 1,800 449 1,899 104 Mortgage indebtedness.............................................. 790 788 578 57 16 312 193 212 105 Bank acceptances outstanding................................ 11,286 10,916 10,590 6,040 525 3,752 274 696 106 Other liabilities........................................................... 21,264 16,199 14,150 4,825 892 5,487 2,946 7,114 107 Total liabilities............................................................. 889,229 868,684 672,115 126,862 34,415 247,342 263,497 217,114 108 Subordinated notes and debentures....................... 4,901 4,837 3,935 1,100 83 1,751 1,001 966 109 Equity capital............................................................... 69,653 68,989 52,293 10,743 2,414 17,457 21,680 17,360 110 Preferred stock....................................................... 81 75 34 10 24 47 Ill Common stock....................................................... 15,963 15,843 11,723 2,444 570 3,714 4,995 4,239 112 Surplus...................................................................... 27,903 27,648 20,676 4,149 1,155 7,325 8,047 7,226 113 Undivided profits................................................... 23,842 23,630 18,566 4,036 645 5,976 7,909 5,276 114 Other capital reserves............................................ 1,865 1,793 1,294 114 44 431 705 571 115 Total liabilities and equity capital........................... 963,782 942,510 728,343 138,705 36,912 266,549 286,177 235,440 116 Memo: Demand deposits adjusted 2....................... 230,329 227,142 164,874 27,182 5,857 54,206 77,629 65,455 Average for last 15 or 30 days: 117 Cash and due from bank...................................... 123,702 119,245 102,290 27,714 4,360 38,225 31,992 21,412 118 Federal funds sold and securities purchased under agreements to resell............................ 38,280 35,632 27,149 2,306 1,341 13,300 10,202 11,131 119 Total loans............................................................... 502,155 490,759 377,741 71,043 20,569 138,707 147,421 124,414 120 Time deposits of $100,000 or more.................... 144,736 138,861 115,899 30,462 10,747 47,240 27,450 28,838 775,140 763,837 574,789 96,456 25,003 203,331 249,999 200,350 122 Federal funds purchased and securities sold under agreements to repurchase................. 64,665 62,022 58,970 14,909 7,184 28,637 8,240 5,695 123 Other liabilities for borrowed money.................. 6,485 4,782 4,474 2,078 87 1,943 367 2,011 124 Standby letters of credit outstanding..................... 10,769 10,355 9,874 5,450 954 2,834 636 895 125 Time deposits of $100,000 or more........................ 145,209 139,572 117,265 30,470 11,159 47,947 27,688 27,944 126 Certificates of deposit............................................ 120,619 117,020 97,457 25,724 8,937 38,645 24,150 23,162 127 Other time deposits................................................ 24,590 22,552 19,808 4,746 2,221 9,302 3,538 4,782 128 Number of banks....................................................... 14,643 14,373 5,776 12 9 154 5,601 8,867 ^ Revised data shown in this table reflect mainly changes for large commercial interbank and U.S. Govt., less cash items reported as in banks in New York City and for other large banks. process of collection. Similarly revised data for Mar. 31, 1977, appear on pp. A-70 and A-71. Note.—Data include consolidated reports, including" figures for all 1 Member banks exclude and nonmember banks include 5 noninsured bank-premises subsidiaries and other significant majority-owned do­ trust companies that are members of the Federal Reserve System, and mestic subsidiaries. Securities are reported on a gross basis before deduc­ member banks exclude 2 national banks outside the continental United tions of valuation reserves. Holdings by type of security will be reported States. as soon as they become available. 2 Demand deposits adjusted are demand deposits other than domestic Back data in lesser detail were shown in previous Bulletins. Details may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 Domestic Financial Statistics □ M ay 1977 1.27 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS Assets and Liabilities Millions of dollars, Wednesday figures 1977 Account Mar. 9 Mar. 16 Mar. 23 Mar. 30 Apr. 6 Apr. 13 Apr. 20 Apr. 27 1Total loans and investments........................................ 412,780 416,040 409,650 411,156 421,508 416,608 417,691 413,879 Loans: 2 Federal funds sold1.................................................. 23,990 23,769 20,589 22,340 27,804 23,622 22,015 20,789 3 To commercial banks.......................................... 18,337 16,922 16,116 17,016 18,622 17,392 17,488 16,696 To brokers and dealers involving— 4 U.S. Treasury securities.................................. 3,163 3,884 2,488 2,713 4,926 3,143 2,517 2,284 5 Other securities................................................. 1,170 1,036 451 689 1,133 679 538 414 6 1,320 1,927 1,534 1,922 3,123 2,408 1,472 1,395 7 Other, gross................................................................ 286,819 289,683 287,914 287,996 290,470 290,674 290,555 290,633 8 Commercial and industrial................................ 116,325 117,060 117,233 116,791 117,285 117,416 117,572 117,427 9 Agricultural........................................................... 4,223 4,245 4,251 4,259 4,300 4,336 4,352 4,369 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities.............................. 1,596 2,520 1,125 1,363 2,756 2,269 1,284 1,382 11 Other securities............................................ 7,656 7,892 7,513 7,715 8,043 7,852 8,647 8,009 To others: 12 U.S. Treasury securities............................. 70 71 69 74 82 81 97 97 13 Other securities............................................ 2,514 2,528 2,518 2,530 2,492 2,535 2,502 2,488 To nonbank financial institutions: 14 Personal and sales finance cos., etc.............. 7,132 7,263 7,293 7,257 7,230 7,284 7,174 7,216 15 Other.................................................................. 15,907 15,910 15,767 15,803 15,771 15,768 15,798 15,814 16 Real estate............................................................. 64,503 64,824 64,930 64,974 65,005 65,151 65,310 65,422 To commercial banks: 17 1,956 2,082 2,064 2,007 2,112 2,220 1,896 2,216 18 5,668 5,684 5,492 5,439 5,383 5,667 5,497 5,504 19 39,492 39,516 39,591 39,761 39,805 39,967 40,113 40,365 20 Foreign governments, official institutions, etc.. 1,768 1,757 1,723 1,758 1,704 1,745 1,653 1,668 21 18,009 18,331 18,345 18,265 18,502 18,383 18,660 18,656 22 Less : Loan loss reserve and unearned income 8,734 8,773 8,784 8,687 8,600 8,658 8,708 8,722 23 278,085 280,910 279,130 279,309 281,870 282,016 281,847 281,911 Investments: 24 U.S. Treasury securities.......................................... 50,651 50,691 49,872 49,489 51,488 50,241 50,369 47,707 25 Bills......................................................................... 10,750 10,859 10,442 10,399 11,663 10,449 10,278 7,592 Notes and bonds, by maturity: 26 Within 1 year.................................................... 8,054 8,046 8,101 7,935 8,425 8,427 8,502 8,376 27 28,090 27,901 27,690 27,554 27,215 27,170 27,291 27,502 28 After 5 years...................................................... 3,757 3,885 3,639 3,601 4,185 4,195 4,298 4,237 29 Other securities......................................................... 60,054 60,670 60,059 60,018 60,346 60,729 63,460 63,472 Obligations of States and political subdivisions: 30 Tax warrants, short-term notes, and bills............................................................. 6,234 6,607 6,365 6,189 6,169 6,649 8,937 8,911 31 40,185 40,538 40,287 40,458 40,712 40,638 40,699 40,822 Other bonds, corporate stocks, and securities: 32 Certificates of participation2......................... 2,206 2,214 2,266 2,287 2,178 2,107 2,162 2,175 33 All other, including corporate stocks.......... 11,429 11,311 11,141 11,084 11,287 11,335 11,662 11,564 34 Cash items in process of collection.......................... 32,126 37,776 35,525 35,862 37,447 37,522 37,433 35,932 35 Reserves with F.R. Banks.......................................... 18,934 19,418 23,786 20,434 12,783 21,580 19,493 21,297 5,283 5,582 5,735 5,901 5,211 6,027 5,939 6,081 12,665 12,620 12,126 14,568 12,520 12,609 12,6^4 12,431 38 Investments in subsidiaries not consolidated......... 2,522 2,579 2,540 2,524 2,573 2,584 2,609 2,608 39 Other assets.................................................................... 50,421 51,181 51,506 52,262 53,544 53,839 52,564 52,962 534,731 545,196 540,868 542,707 545,586 550,769 548,393 545,190 Deposits: 41 Demand deposits....................................................... 164,326 178,073 167,078 170,675 176,422 176,531 176,414 173,438 42 Individuals, partnerships, and corporations.. 120,164 126,723 121,706 123,137 127,687 130,418 128,207 125,746 43 States and political subdivisions....................... 5,603 5,969 6,315 5,706 5,912 6,080 5,986 6,219 44 U.S. Govt............................................................... 1,252 6,856 1,126 1,045 1,796 1,511 3,523 4,791 Domestic interbank: 45 23,813 24,610 23,435 26,323 25,451 24,679 24,785 22,753 46 Mutual savings.................................................. 821 842 722 756 968 868 850 806 Foreign: 47 Governments, official institutions, etc......... 1,160 868 1,019 1,148 1,090 1,062 1,039 1,061 48 Commercial banks........................................... 5,684 5,721 5,484 5,882 5,628 5,626 5,444 5,813 49 Certified and officers’ checks............................. 5,829 6,484 7,271 6,678 7,890 6,287 6,580 6,249 50 Time and savings deposits3.................................... 231,890 231,912 233,261 234,857 233,858 232,731 231,776 231,862 51 Savings 4................................................................. 93,337 93,723 94,119 94,997 95,398 95,034 94,687 94,691 Time: 52 Individuals, partnerships, and corporations 104,974 104,568 105,505 106,158 105,392 104,813 104,271 104,260 53 States and political subdivisions................... 20,038 19,908 20,040 20,059 19,597 19,717 19,687 19,915 54 Domestic interbank......................................... 5,183 5,352 5,311 5,390 5,125 4,890 4,729 4,627 55 Foreign govts., official institutions, etc........ 6,948 6,950 6,876 6,854 6,927 6,845 6,943 6,939 56 Federal funds purchased, etc. 5.................................. 68,637 64,690 67,889 66,924 65,164 71,850 70,894 69,167 Borrowings from: 57 F.R. Banks................................................................. 7 5 2,101 100 8 16 28 423 58 Others......................................................................... 3,693 3,804 3,945 3,926 4,063 3,565 3,412 3,426 24,223 24,842 24,722 24,418 24,023 24,011 23,829 24,786 60 Total equity capital and subordinated notes/debentures7................................................ 41,955 41,870 41,872 41,807 42,048 42,065 42,040 42,088 1 Includes securities purchased under agreements to resell. 5 Includes securities sold under agreements to repurchase. 2 Federal agencies only. 6 Includes minority interest in consolidated subsidiaries and deferred 3 Includes time deposits of U.S. Govt, and of foreign banks, which are tax portion of reserves for loans. not shown separately. 7 Includes reserves for securities and contingency portion of reserves 4 For amounts of these deposits by ownership categories, see Table 1.30. for loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

W eekly Reporting Banks A21 1.28 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1977 Account Mar. 9 Mar. 16 j Mar. 23 Mar. 30 Apr. 6 Apr. 13 Apr. 20 Apr. 27 1Total loans and investments........................................ 90,398 91,896 88,562 89,235 89,454 88,857 90,949 89,395 Loans: 2 Federal funds sold 1.................................................. 2,899 3,393 3,135 4,043 2,123 2,591 2,922 3,213 3 To commercial banks.......................................... 1,478 2,026 2,000 2,221 1,236 1,512 1,797 2,173 To brokers and dealers involving— 4 U.S. Treasury securities.................................. 725 111 494 641 439 586 527 516 s 554 413 145 6 To others................................................................ 142 237 641 1,036 448 493 598 524 7 Other, gross............................................................... 67,868 69,410 66,839 67,206 68,375 68,098 67,275 66,897 8 Commercial and industrial................................ 33,982 34,170 33,897 33,939 34,074 33,847 33,750 33,543 9 Agricultural........................................................... 115 120 121 121 120 123 126 128 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities.............................. 1,427 2,158 896 1,154 2,354 2,012 1,027 1,160 11 Other securities............................................. 4,206 4,677 4,080 4,210 4,460 4,305 4,946 4,422 To others: 12 U.S. Treasury securities.............................. 12 12 11 11 11 10 25 25 13 Other securities............................................. 374 373 371 372 367 368 340 340 To nonbank financial institutions: 14 Personal and sales finance cos., etc.............. 2,422 2,508 2,433 2,492 2,377 2,386 2,278 2,357 15 Other................................................................... 5,255 5,231 5,174 5,129 5,065 5,034 5,049 5,043 16 Real estate.............................................................. 8,953 8,979 8,991 8,924 8,875 8,841 8,823 8,806 To commercial banks: 17 726 718 628 628 561 848 540 610 18 Foreign............................................................... 2,603 2,583 2,416 2,397 2,338 2,568 2,428 2,455 19 Consumer instalment.......................................... 4,045 4,018 3,998 3,977 3,974 4,002 4,009 4,017 20 Foreign governments, official institutions, etc. 374 403 366 426 391 435 383 388 21 All other loans...................................................... 3,374 3,460 3,457 3,426 3,408 3,319 3,551 3,603 22 Less : Loan loss reserve and unearned income on loans..................................................... 1,720 1,720 1,697 1,618 1,571 1,592 1,597 1,592 23 66,148 67,690 65,142 65,588 66,804 66,506 65,678 65,305 Investments: 24 U.S. Treasury securities........................................... 12,775 12,232 11,877 11,230 12,095 11,201 11,913 10,528 25 Bills.......................................................................... 3,549 3,279 3,064 2,602 3,107 2,447 3,229 1,633 Notes and bonds, by maturity: 26 Within 1 year..................................................... 831 868 889 868 875 894 898 891 27 1 to 5 years........................................................ 7,677 7,266 7,227 7,078 7,035 6,866 6,815 7,008 28 After 5 years...................................................... 718 819 697 682 1,078 994 971 996 29 Other securities.......................................................... 8,576 8,581 8,408 8,374 8,432 8,559 10,436 10,349 Obligations of States and political subdivisions: 30 Tax warrants, short-term notes, and bills.. 869 939 995 843 815 863 2,494 2,504 31 All other............................................................. 5,974 6,063 5,936 5,975 5,963 6,049 6,025 5,999 Other bonds, corporate stocks, and securities: 32 Certificates of participation2......................... 220 220 220 220 213 213 215 215 33 All other, including corporate stocks.......... 1,513 1,359 1,257 1,336 1,441 1,434 1,702 1,631 34 Cash items in process of collection.......................... 10,316 12,355 13,398 13,596 12,795 11,675 11,668 11,539 35 Reserves with F.R. Banks........................................... 6,081 5,128 6,048 5,386 2,406 6,533 4,324 4,160 36 Currency and coin........................................................ 815 892 913 921 839 919 945 944 5,869 5,473 5,739 6,757 5,408 5,930 5,813 5,623 38 Investments in subsidiaries not consolidated......... 1,157 1,190 1,191 1,165 1,198 1,213 1,242 1,241 39 Other assets.................................................................... 17,012 17,424 17,901 17,545 18,548 18,968 17,770 17,967 40 Total assets/total liabilities.......................................... 131,648 134,358 133,752 134,605 130,648 134,095 132,711 130,869 Deposits: 41 Demand deposits........................................................ 46,048 51,125 48,958 49,793 49,050 48,343 48,050 47,230 42 Individuals, partnerships, and corporations.. 26,011 28,880 27,671 27,627 27,728 27,846 27,602 27,558 43 States and political subdivisions....................... 511 657 733 500 457 527 527 501 44 U.S. Govt............................................................... 81 1,994 158 102 128 165 583 749 Domestic interbank: 45 Commercial....................................................... 11,069 11,102 10,841 12,494 11,089 11,588 11,098 10,227 46 Mutual savings................................................. 419 436 347 381 520 467 433 417 Foreign: 47 Governments, official institutions, etc......... 925 657 800 912 865 844 795 672 48 Commercial banks........................................... 4,385 4,337 4,192 4,510 4,199 4,181 4,161 4,419 49 Certified and officers’ checks............................. 2,647 3,062 4,216 3,267 4,064 2,725 2,851 2,687 50 Time and savings deposits3...................................... 41,875 41,609 41,748 42,163 41,570 41,044 40,893 40,796 51 Savings4.................................................................. 10,739 10,767 10,773 10,920 10,924 10,892 10,907 10,934 Time: 52 Individuals, partnerships, and corporations 23,065 22,753 23,083 23,190 22,820 22,499 22,361 22,311 53 States and political subdivisions................... 1,193 1,219 1,219 1,333 1,277 1,276 1,305 1,324 54 Domestic interbank......................................... 2,091 2,109 2,003 2,099 2,045 1,988 1,967 1,891 55 Foreign govts., official institutions, etc........ 4,025 3,997 3,910 3,861 3,738 3,625 3,556 3,559 56 Federal funds purchased, etc. 5.................................. 19,619 16,978 17,275 18,018 15,779 20,589 19,810 18,158 Borrowings from: 57 F/R Ranks................................................................. 1,107 240 58 Others.......................................................................... 1,791 1,650 1,729 1,861 1,861 1,565 1,427 1,429 59 Other liabilities, etc.6................................................... 10,401 11,087 11,015 10,841 10,440 10,612 10,605 11,077 60 Total equity capital and subordinated 11,914 11,909 11,920 11,929 11,948 11,942 11,926 11,939 1 Includes securities purchased under agreements to resell. 5 Includes securities sold under agreements to repurchase. 2 Federal agencies only. 6 Includes minority interest in consolidated subsidiaries and deferred 3 Includes time deposits of U.S. Govt, and of foreign banks, which tax portion of reserves for loans. are not shown separately. 7 Includes reserves for securities and contingency portion of reserves 4 For amounts of these deposits by ownership categories, see Table 1.30. for loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 Domestic Financial Statistics □ M ay 1977 1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS OUTSIDE NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1977 Account Mar. 9 Mar. 16 Mar. 23 Mar. 30 Apr. 6 Apr. 13 Apr. 20 Apr. 27 1Total loans and investments........................................ 322,382 324,144 321,088 321,921 332,054 327,751 326,742 324,484 Loans: 2 Federal funds sold1................................................... 21,091 20,376 17,454 18,297 25,681 21,031 19,093 17,576 3 16,859 14,896 14,116 14,795 17,386 15,880 15,691 14,523 To brokers and dealers involving— 4 U.S. Treasury securities.................................. 2,438 3,167 1,994 2,072 4,487 2,557 1,990 1,768 5 Other securities................................................. 616 623 451 544 1,133 679 538 414 6 1,178 1,690 893 886 2,675 1,915 874 871 7 218,951 220,273 221,075 220,790 222,095 222,576 223,280 223,736 8 Commercial and industrial................................ 82,343 82,890 83,336 82,852 83,211 83,569 83,822 83,884 9 4,108 4,125 4,130 4,138 4,180 4,213 4,226 4,241 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities.............................. 169 362 229 209 402 257 257 222 11 3,450 3,215 3,433 3,505 3,583 3,547 3,701 3,587 To others: 12 U.S. Treasury securities.............................. 58 59 58 63 71 71 72 72 13 Other securities............................................. 2,140 2,155 2,147 2,158 2,125 2,167 2,162 2,148 To nonbank financial institutions: 14 Personal and sales finance cos., etc.............. 4,710 4,755 4,860 4,765 4,853 4,898 4,896 4,859 15 Other................................................................... 10,652 10,679 10,593 10,674 10,706 10,734 10,749 i0,771 16 Real estate.............................................................. 55,550 55,845 55,939 56,050 56,130 56,310 56,487 56,616 To commercial banks: 17 1,230 1,364 1,436 1,379 1,551 1,372 1,356 1,606 18 3,065 3,101 3,076 3,042 3,045 3,099 3,069 3,049 19 35,447 35,498 35,593 35,784 35,831 35,965 36,104 36,348 20 Foreign governments, official institutions, etc. 1,394 1,354 1,357 1,332 1,313 1,310 1,270 1,280 21 All other loans...................................................... 14,635 14,871 14,888 14,839 15,094 15,064 15,109 15,053 22 Less : Loan reserve and unearned income on loans......................................................... 7,014 7,053 7,087 7,069 7,029 7,066 7,111 7,130 23 211,937 213,220 213,988 213,721 215,066 215,510 216,169 216,606 Investments: 24 37,876 38,459 37,995 38,259 39,393 39,040 38,456 37,179 25 Bills.......................................................................... 7,201 7,580 7,378 7,797 8,556 8,002 7,058 5,959 Notes and bonds, by maturity: 26 7,223 7,178 7,212 7,067 7,550 7,533 7,604 7,485 27 20,413 20,635 20,463 20,476 20,180 20,304 20,476 20,494 28 After 5 years..................................................... 3,039 3,066 2,942 2,919 3,107 3,201 3,318 3,241 29 51,478 52,089 51,651 51,644 51,914 52,170 53,024 53,123 Obligations of States and political subdivisions: 30 Tax warrants, short-term notes, and bills.. 5,365 5,668 5,370 5,346 5,354 5,786 6,443 6,407 31 All other............................................................. 34,211 34,475 34,351 34,483 34,749 34,589 34,674 34,823 Other bonds, corporate stocks, and securities: 32 Certificates of participation2......................... 1,986 1,994 2,046 2,067 1,965 1,894 1,947 1,960 33 All other, including corporate stocks.......... 9,916 9,952 9,884 9,748 9,846 9,901 9,960 9,933 34 Cash items in process of collection........................... 21,810 25,421 22,127 22,266 24,652 25,847 25,765 24,393 12,853 14,290 17,738 15,048 10,377 15,047 15,169 17,137 36 Currency and coin........................................................ 4,468 4,690 4,822 4,980 4,372 5,108 4,994 5,137 37 Balances with domestic banks.................................... 6,796 7,147 6,387 7,811 7,112 6,679 6,851 6,808 38 Investments in subsidiaries not consolidated......... 1,365 1,389 1,349 1,359 1,375 1,371 1,367 1,367 39 Other assets.................................................................... 33,409 33,757 33,605 34,717 34,996 34,871 34,794 34,995 40 Total assets/total liabilities.......................................... 403,083 410,838 407,116 408,102 414,938 416,674 415,682 414,321 Deposits: 41 Demand deposits......................................................... 118,278 126,948 118,120 120,882 127,372 128,188 128,364 126,208 42 Individuals, partnerships, and corporations .. 94,153 97,843 94,035 95,510 99,959 102,572 100,605 98,188 43 States and political subdivisions....................... 5,092 5,312 5,582 5,206 5,455 5,553 5,459 5,718 44 U.S. Govt............................................................... 1,171 4,862 968 943 1,668 1,346 2,940 4,042 Domestic interbank: 45 12,744 13,508 12,594 13,829 14,362 13,091 13,687 12,526 46 402 406 375 375 448 401 417 389 Foreign: 47 Governments, official institutions, etc......... 235 211 219 236 225 218 244 389 48 1,299 1,384 1,292 1,372 1,429 1,445 1,283 1,394 49 3,182 3,422 3,055 3,411 3,826 3,562 3,729 3,562 50 190,015 190,303 191,513 192,694 192,288 191,687 190,883 191,066 51 Savings4................................................................. 82,598 82,956 83,346 84,077 84,474 84,142 83,780 83,757 Time: 52 Individuals, partnerships, and corporations 81,909 81,815 82,422 82,968 82,572 82,314 81,910 81,949 53 States and political subdivisions................... 18,845 18,689 18,821 18,726 18,320 18,441 18,382 18,591 54 Domestic interbank......................................... 3,092 3,243 3,308 3,291 3,080 2,902 2,762 2,736 55 Foreign govts., official institutions, etc........ 2,923 2,953 2,966 2,993 3,189 3,220 3,387 3,380 56 Federal funds purchased, etc.5.................................. 49,018 47,712 50,614 48,906 49,385 51,261 51,084 51,009 Borrowings from: 57 F. R. Banks................................................................ 7 5 994 100 8 16 28 183 58 Others.......................................................................... 1,902 2,154 2,216 2,065 2,202 2,000 1,985 1,997 59 Other liabilities, etc.6................................................... 13,822 13,755 13,707 13,577 13,583 13,399 13,224 13,709 60 Total equity capital and subordinated notes/debentures 7................................................. 30,041 29,961 29,952 29,878 30,100 30,123 30,114 30,149 1 Includes securities purchased under agreements to resell. 5 Includes securities sold under agreements to repurchase. 2 Federal agencies only. 6 Includes minority interest in consolidated subsidiaries and deferred 3 Includes time deposits of U.S. Govt, and of foreign banks, which tax portion of reserves for loans. are not shown separately. 7 Includes reserves for securities and contingency portion of reserves 4 For amounts of these deposits by ownership categories, see Table 1.30. for loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

W eekly Reporting Banks A23 1.30 LARGE WEEKLY REPORTING COMMERCIAL BANKS Balance Sheet Memoranda Millions of dollars, Wednesday figures 1977 Account and bank group Mar. 9 Mar. 16 Mar. 23 Mar. 30 Apr. 6 Apr. 13 Apr. 20 Apr. 27 Total loans (gross) and investments, adjusted1 1 Large banks............................................................... 401,221 405,809 400,254 400,820 409,374 405,654 407,015 403,689 89,914 90,872 87,631 88,004 89,228 88,089 90,209 88,204 3 Banks outside New York City.......................... 311,307 314,937 312,623 312,816 320,146 317,565 316,806 315,485 Total loans (gross), adjusted 290,516 294,448 290,323 291,313 297,540 294,684 293,186 292,510 5 New York City banks......................................... 68,563 70,059 67,346 68,400 68,701 68,329 67,860 67,327 6 Banks outside New York City.......................... 221,953 224,389 222,977 222,913 228,839 226,355 225,326 225,183 Demand deposits, adjusted2 107,135 108,831 106,992 107,445 111,728 112,819 110,673 109,962 8 New York City banks......................................... 24,582 25,674 24,561 23,601 25,038 24,915 24,701 24,715 9 Banks outside New York City.......................... 82,553 83,157 82,431 83,844 86,690 87,904 85,972 85,247 Large negotiable time CD’s included in time and savings deposits3 Total: 10 Large banks.................................................................... 60,774 60,277 61,257 61,945 60,805 59,947 59,344 59,260 11 New York City..................................................... 20,941 20,472 20,642 20,858 20,307 19,843 19,684 19,606 12 Banks outside New York City.......................... 39,833 39,805 40,615 41,087 40,498 40,104 39,660 39,654 Issued to IPC’s: 39, 733 39,141 40,113 40,654 39,804 39,234 38,774 38,657 14,265 13,829 14,205 14,251 13,859 13,562 13,441 13,381 15 Banks outside New York City.......................... 25,468 25,312 25,908 26,403 25,945 25,672 25,333 25,276 Issued to others: 21,041 21,136 21,144 21,291 21,001 20,713 20,570 20,603 17 New York City banks......................................... 6,676 6,643 6,437 6,607 6,448 6,281 6,243 6,225 18 Banks outside New York City.......................... 14,365 14,493 14,707 14,684 14,553 14,432 14,327 14,378 All other large time deposits4 Total: 19 Large banks.................................................................... 25,990 25,928 25,778 IS,111 25,337 25,472 25,392 IS,All 20 New York City banks......................................... 5,200 5,303 5,247 5,252 5,213 5,170 5,115 5,070 21 Banks outside New York City.......................... 20,790 20,625 20,531 20,465 20,124 20,302 20,277 20,402 Issued to IPC’s: 22 Large banks............................................................... 14,221 14,224 14,065 14,114 14,021 14,041 13,911 13,929 23 New York City banks......................................... 3,862 3,902 3,842 3,861 3,879 3,827 3,790 3,785 24 Banks outside New York City.......................... 10,359 10,322 10,223 10,253 10,142 10,214 10,121 10,144 Issued to others: 25 Large banks............................................................... 11,769 11,704 11,713 11,603 11,316 11,431 11,481 11,543 26 New York City banks......................................... 1,338 1,401 1,405 1,391 1,334 1,343 1,325 1,285 27 Banks outside New York City.......................... 10,431 10,303 10,308 10,212 9,982 10,088 10,156 10,258 Savings deposits, by ownership category Individuals and nonprofit organizations: 28 Large banks............................................................... 85,728 86,195 86,572 87,386 87,870 87,458 86,976 86,999 29 New York City banks......................................... 9,675 9,716 9,745 9,816 9,873 9,848 9,802 9,815 30 Banks outside New York City.......................... 76,053 76,479 76,827 77,570 77,997 77,610 77,174 77,184 Partnerships and corporations for profit:5 31 Large banks............................................................... 4,906 4,866 4,931 4,988 5,029 5,024 5,000 5,027 32 New York City banks......................................... 531 533 533 544 560 561 564 568 33 Banks outside New York City.......................... 4,375 4,333 4,398 4,444 4,469 4,463 4,436 4,459 Domestic governmental units: 34 Large banks............................................................... 2,600 2,570 2,521 2,514 2,395 2,453 2,622 2,579 35 New York City banks......................................... 452 446 422 All 414 409 480 492 36 Banks outside New York City.......................... 2,148 2,124 2,099 2,042 1,981 2,044 2,142 2,087 All other:6 103 92 95 109 104 99 89 86 81 72 73 88 11 IA 61 59 39 Banks outside New York City.......................... 22 20 22 21 21 25 28 27 Gross liabilities oi banks to their foreign branches 40 Large banks............................................................... 3,158 4,785 3,682 3,797 2,878 3,371 3,375 3,293 41 New York City banks......................................... 2,359 3,827 2,643 3,027 1,914 2,309 2,458 2,234 42 Banks outside New York City.......................... 799 958 1,039 770 964 1,062 917 1,059 Loans sold outright to selected institutions by all large banks7 2,667 2,674 2,718 2,721 2,707 2,745 2,728 2,759 211 173 213 216 226 213 212 212 45 All other..................................................................... 1,073 1,078 1,067 1,105 1,126 1,127 1,076 1,053 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 Financial Statistics □ M ay 1977 1.31 LARGE WEEKLY REPORTING COMMERCIAL BANKS Commercial and Industrial Loans Millions of dollars Outstanding Net change during— Industry group 1977 1976 1977 Mar. 30 Apr. 6 Apr. 13 Apr. 20 Apr. 27 Q4 I Feb. Mar. Apr. Total loans classified2 1 Total......................................................... 95,794 96,036 96,107 96,222 95,974 '4,041 -916 '665 616 180 Durable goods manufacturing: 2 Primary metals................................... 2,577 2,496 2,501 2,464 2,422 138 377 148 40 -155 3 Machinery........................................... 4,766 4,770 4,777 4,789 4,793 41 108 44 136 27 4 Transportation equipment............... 2,304 2,288 2,330 2,352 2,353 -180 74 -13 107 49 5 Other fabricated metal products... 1,891 1,901 1,932 1,919 1,907 22 181 77 116 16 6 Other durable goods........................ 3,344 3,418 3,442 3,427 3,448 -249 90 81 156 104 Nondurable goods manufacturing: 7 Food, liquor, and tobacco.............. 3,349 3,355 3,334 3,333 3,308 128 -151 -43 -20 -41 8 Textiles, apparel, and leather......... 3,377 3,454 3,568 3,521 3,514 -504 381 128 132 137 9 Petroleum refining............................ 2,336 2,353 2,378 2,432 2,436 120 -305 -117 -186 100 10 Chemicals and rubber...................... 2,689 2,756 2,775 2,774 2,775 18 131 31 113 86 11 Other nondurable goods................. 2,044 2,059 2,071 2,043 2,041 14 147 61 84 -3 12 Mining, including crude petroleum and natural gas.............................. 7,415 7,424 7,460 7,555 7,606 361 94 '16 -14 191 Trade: 13 Commodity dealers........................... 2,137 2,138 2,098 2,069 2,018 377 204 197 28 -119 14 Other wholesale................................. 6,725 6,781 6,731 6,812 6,844 211 465 165 352 119 15 Retail................................................... 6,507 6,564 6,534 6,643 6,580 '-264 405 '101 304 73 16 Transportation....................................... 5,165 5,102 5,085 5,071 5,053 81 -140 135 -12 -112 17 Communication..................................... 1,348 1,411 1,341 1,329 1,312 -131 -10 183 -246 -36 18 Other public utilities............................. 5,540 5,612 5,586 5,440 5,384 -101 -61 92 -165 -156 19 Construction........................................... 3,973 3,956 3,981 4,021 4,048 -203 64 67 44 75 20 Services.................................................... 10,953 10,933 10,936 11,017 11,066 129 398 62 93 113 21 All other domestic loans..................... 7,616 7,607 7,630 7,497 7,430 576 -303 '-110 229 -186 22 Bankers acceptances.............................. 3,943 3,908 3,906 3,955 3,929 3,285 -2,930 -631 -488 -14 23 Foreign commercial and industrial loans................................................ 5,795 5,750 5,711 5,759 5,707 172 -135 -9 -187 -88 Memo: 24 Commercial paper included in total classified loans1................... 352 293 241 -216 -42 18 -59 25 Total commercial and industrial loans of all large weekly reporting banks.............................. 116,791 117,285 117,416 117,572 117,427 '4,269 203 1,013 1,336 636 1976 1977 1976 1977 1977 Dec. 29 Jan. 26 Feb. 23 Mar. 30 Apr. 27 Q4 Ql Feb. Mar. April “Term” loans classified3 26 Total......................................................... 45,211 '45,290 45,735 '45,841 45,894 '450 '630 '445 '99 53 Durable goods manufacturing: 27 Primary metals................................... 1,317 1,449 1,481 1,521 1,344 103 204 32 40 -177 28 Machinery........................................... 2,585 2,587 2,551 2,552 2,499 -90 -33 -36 1 -53 29 Transportation equipment............... 1,352 1,365 1,298 1,339 1,383 -29 -13 -67 41 44 30 Other fabricated metal products... 776 767 815 820 841 20 44 48 5 21 31 Other durable goods......................... 1,625 1,549 1,585 1,625 1,630 -111 36 40 5 Nondurable goods manufacturing: 32 Food, liquor, and tobacco.............. 1,398 1,449 1,447 1,412 1,374 -37 14 -2 -35 -38 33 Textiles, apparel, and leather......... 1,098 1,033 1,036 1,071 1,099 -46 -27 3 35 28 34 Petroleum refining............................ 1,972 1,925 1,901 1,770 1,805 64 -202 -24 -131 35 35 Chemicals and rubber...................... 1,444 1,456 1,522 1,547 1,589 -20 103 66 25 42 36 Other nondurable goods................. 954 975 987 1,032 1,101 19 78 12 45 69 37 Mining, including crude petroleum and natural gas.............................. 5,683 5,793 5,761 5,856 6,015 341 173 -32 95 159 Trade: 38 Commodity dealers........................... 200 227 219 199 200 -9 -1 -8 -20 1 39 Other wholesale................................. 1,463 1,483 1,478 '1,479 1,489 69 '16 -5 '1 10 40 Retail................................................... 2,045 '2,087 2,212 '2,268 2,274 -89 '223 '125 '56 6 41 Transportation....................................... 3,937 '3,717 3,830 3,773 3,695 3 -164 '113 -57 -78 42 Communication..................................... 847 810 829 779 802 -56 -68 19 -50 23 43 Other public utilities............................. 3,664 3,762 3,869 3,907 3,796 60 243 107 38 -111 44 Construction........................................... 1,629 1,638 1,683 1,661 1,720 -62 32 45 -22 59 45 Services.................................................... 4,998 5,212 5,216 5,111 5,188 31 113 4 -105 77 46 All other domestic loans..................... 2,600 2,383 2,352 '2,433 2,408 181 '—167 40 74 -25 47 Foreign commercial and industrial loans................................................ 3,624 3,623 3,663 3,686 3,642 108 62 -31 23 -44 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

D eposits and Com m ercial Paper A25 1.32 GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations Billions of dollars; estimated daily-average balances All commercial banks Type of holder 1975 1976 1977 1972 1973 1974 Dec. Dec. Dec. Sept. Dec. Mar. June Sept. Dec. Mar.» 1 All holders, IPC......................................................... 208.0 220.1 225.0 227.0 236.9 227.9 234.2 236.1 250.1 242.3 2 Financial business...................................................... 18.9 19.1 19.0 19.0 20.1 19.9 20.3 19.7 22.3 21.6 3 Nonfinancial business................................................ 109.9 116.2 118.8 118.7 125.1 116.9 121.2 122.6 130.2 125.1 65.4 70.1 73.3 76.5 78.0 77.2 78.8 80.0 82.6 81.6 5 Foreign.......................................................................... 1.5 2.4 2.3 2.2 2.4 2.4 2.5 2.3 2.7 2.4 6 Other............................................................................. 12.3 12.4 11.7 10.6 11.3 11.4 11.4 11.5 12.4 11.6 All weekly reporting banks 1976 1977 1973 1974 1975 Dec. Dec. Dec. Sept. Oct. Nov. Dec. Jan. Feb. Mar.p 7 All holders, IPC.......................................................... 118.1 119.7 124.4 121.4 123.8 124.3 128.5 127.4 123.0 124.7 8 Financial business....................................................... 14.9 14.8 15.6 15.4 16.8 16.2 17.5 16.7 15.6 16.7 9 Nonfinancial business................................................ 66.2 66.9 69.9 66.6 68.4 68.7 69.7 69.5 67.4 67.8 28.0 29.0 29.9 30.7 29.6 30.4 31.7 32.0 31.1 31.5 2.2 2.2 2.3 2.2 2.4 2.5 2.6 2.2 2.4 2.2 12 Other............................................................................. 6.8 6.8 6.6 6.6 6.6 6.6 7.1 7.1 6.5 6.5 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 1977 1974 1975 1976 Instrument Dec. Dec. Dec. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Commercial paper 1 49,144 47,690 52,041 49,852 51,370 53,116 52,041 53,905 '59,432 54,671 Financial companies:1 Dealer-placed paper:2 2 Total..................................................................... 4,611 6,239 7,294 6,347 6,674 7,113 7,294 7,347 7,291 7,271 3 Bank-related........................................................ 1,814 1,762 1,900 1,644 1,703 1,825 1,900 1,895 1,929 1,839 Directly-placed paper:3 4 Total...................................................................... 31,839 31,276 32,416 31,476 31,880 32,691 32,416 32,753 '32,392 33,709 5 Bank-related........................................................ 6,518 6,892 5,959 6,?50 5,864 5,944 5,959 5,637 5,502 6,126 6 Nonfinancial companies4.......................................... 12,694 10,175 12,331 12,029 12,816 13,312 12,331 13,805 14,749 13,691 Dollar acceptances 7 Total.............................................................................. 18,484 18,727 22,523 19,599 20,312 20,678 22,523 22,362 22,187 22,694 Held by: 8 Accepting banks....................................................... 4,226 7,333 10,442 6,798 7,959 9,031 10,442 8,183 7,991 7,787 9 Own bills.............................................................. 3,685 5,899 8,769 5,865 6,789 7,706 8,769 7,011 6,654 6,367 10 Bills bought......................................................... 542 1,435 1,673 933 1,170 1,325 1,673 1,172 1,337 1,421 F.R. Banks: 11 Own account....................................................... 999 1,126 991 838 337 188 991 191 322 289 12 Foreign correspondents.................................... 1,109 293 375 417 387 349 375 374 440 435 13 Others........................................................................ 12,150 9,975 13,447 11,545 11,629 11,111 10,715 13,615 13,434 14,182 Based on: 14 Imports into United States.................................. 4,023 3,726 4,992 4,498 4,737 4,667 4,992 4,992 5,138 4,983 15 Exports from United States................................. 4,067 4,001 4,818 4,420 4,715 4,628 4,818 5,137 5,074 5,222 16 All other................................................................... 10,394 11,000 12,713 10,680 10,860 11,383 12,713 12,233 11,974 12,489 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 Financial Statistics □ M ay 1977 1.34 PRIME RATE CHARGED BY BANKS on Short-term Business Loans Per cent per annum Effective date Rate Effective date Rate Month Average rate 1975—Jan. 9 10V4 1975—Aug. 12 m 1975—Aug. 7.66 15 10 Sept. 7.88 20 93/4 Sept. 15 8 Oct. 7.96 28 91/2 Nov. 7.53 Oct. 27 m Dec. 7.26 Feb. 3 91/4 10 9 Nov. 5 71/2 1976—Jan.. 7.00 18 8V4 Feb. 6.75 24 81/2 Dec. 2 7V4 Mar. 6.75 Apr. 6.75 Mar. 5 8V4 1976—Jan. 12 7 May 6.75 10 8 21 6V4 June 7.20 18 734 July. 7.25 24 71/2 June 1 1 Aug. 7.01 7 71/4 Sept. 7.00 May 20 7% Oct.. 6.78 Aug. 2 7 Nov. 6.50 June 9 1 Dec. 6.35 Oct. 4 6V4 July 18 m 1977—Jan.. 6.25 28 71/2 Nov. 1 61/2 Feb. 6.25 Mar. 6.25 Dec. 13 6V4 Apr. 6.25 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 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 1976 Nov. Aug. Nov. Aug. Nov. Aug. Nov. Aug. Nov. Aug. Nov. Aug. Short-term rates 1All 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 All 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 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 All 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 S. 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 M arkets A ll 1.36 INTEREST RATES Money and Capital Markets Averages, per cent per annum 1977 1977,week ending— Instrument 1974 1975 1976 Jan. Feb. Mar. Apr. Apr. 2 Apr. 9 Apr. 16Apr. 23Apr. 30 Money market rates Prime commercial paper 1 1 90-to 119-day............... 10.05 6.26 5.24 4.72 4.76 4.75 4.75 4.75 4.75 4.75 4.75 4.75 2 4- to 6-month............... 9.87 6.33 5.35 4.74 4.82 4.87 4.87 4.88 4.88 4.88 4.86 4.86 3 Finance company paper, directly placed, 3- to 6- month 2.................................... 8.62 6.16 5.22 4.64 4.75 4.77 4.81 4.85 4.88 4.85 4.75 4.75 4 Prime bankers acceptances, 90-day - 9.92 6.30 5.19 4.81 4.83 4.80 4.78 4.76 4.79 4.76 4.76 4.82 5 Federal funds 4.......................................... 10.51 5.82 5.05 4.61 4.68 4.69 4.73 4.74 4.60 4.65 4.71 4.82 Large negotiable certificates of deposit 6 3-month, secondary market 5............. 10.27 6.43 5.26 4.82 4.65 4.83 4.81 4.83 4.86 4.78 4.79 4.79 7 3-month, primary market 6................. 5.15 4.68 4.69 4.74 4.72 4.75 4.71 4.75 4.68 4.74 8 Euro-dollar deposits, 3-month 7. 10.96 6.97 5.57 5.14 5.08 5.13 5.16 5.24 5.18 5.27 5.09 5.14 U.S. Govt, securities Bills: 3 Market yields: 9 3-month................. 7.84 5.80 4.98 4.62 4.67 4.60 4.54 4.57 4.58 4.55 4.51 4.51 10 6-month................. 7.95 6.11 5.26 4.83 4.90 4.88 4.80 4.81 4.84 4.75 4.76 4.84 11 1-year..................... 7.71 6.30 5.52 5.00 5.16 5.19 5.10 5.15 5.14 5.03 5.04 5.18 Rates on new issue: 12 3-month................. 7.886 5.838 4.989 4.597 4.662 4.613 4.540 4.609 4.585 4.561 4.494 4.518 13 6-month................. 7.926 6.122 5.266 4.783 4.896 4.883 4.790 4.870 4.846 4.767 4.708 4.838 Notes and bonds maturing in—9 14 9 to 12 months............................ 8.25 6.70 5.84 5.34 5.50 5.50 5.37 5.45 5.42 5.32 5.31 5.41 15 3 to 5 years.................................. 7.81 7.55 6.94 6.49 6.69 6.73 6.58 6.70 6.70 6.52 6.49 6.61 Constant maturities:1 o 16 1 -year........................... 8.18 6.76 5.88 5.29 5.47 5.50 5.44 5.45 5.43 5.39 5.41 5.54 17 2-yea r 6.31 5.90 6.09 6.09 5.97 6.05 6.03 5.88 5.92 6.04 18 3-yea r 7.82 7.49 6.77 6.22 6.44 6.47 6.32 6.45 6.45 6.22 6.23 6.38 19 5-year........................... 7.80 7.77 7.18 6.58 6.83 6.93 6.79 6.94 6.94 6.73 6.70 6.80 Capital market rates Government notes and bonds U.S. Treasury: Constant maturities:10 20 7.71 7.90 7.42 6.92 7.16 7.20 7.11 7.22 7.22 7.06 7.04 7.14 21 7.56 7.99 7.61 7.21 7.39 7.46 7.37 7.45 7.45 7.32 7.31 7.40 22 20-year.................................................. 8.05 8.19 7.86 7.48 7.64 7.73 7.67 7.73 7.72 7.65 7.62 7.69 23 30-year................................................... 7.80 7.73 7.79 7.78 7.71 7.68 7.76 24 Long-term 9.............................................. 6.99 6.98 6.78 6.68 7.15 7.20 7.14 7.19 7.19 7.11 7.09 7.15 State and local:11 Moody’s series: 25 Aaa........................................................ 5.89 6.42 5.66 5.10 5.17 5.21 5.18 5.20 5.17 5.17 5.20 5.17 26 Baa......................................................... 6.53 7.62 7.49 6.58 6.50 6.41 6.27 6.35 6.31 6.25 6.27 6.25 27 Bond Buyer series 12............................... 6.17 7.05 6.64 5.87 5.89 5.89 5.73 5.85 5.79 5.70 5.73 5.68 Corporate bonds Seasoned issues 13 28 All industries............................................ 9.03 9.57 9.01 8.41 8.48 8.51 8.49 8.53 8.52 8.50 8.46 8.46 By rating groups: 29 Aaa......................................................... 8.57 8.83 8.43 7.96 8.04 8.10 8.04 8.10 8.10 8.05 7.99 8.01 30 Aa........................................................... 8.84 9.17 8.75 8.16 8.26 8.28 8.28 8.31 8.31 8.28 8.27 8.27 31 A............................................................. 9.20 9.65 9.09 8.45 8.49 8.55 8.55 8.59 8.58 8.56 8.53 8.53 32 Baa......................................................... 9.50 10.61 9.75 9.08 9.12 9.12 9.07 9.11 9.11 9.10 9.05 9.03 Aaa utility bonds:14 33 New issue.................................................. 9.33 9.40 8.48 8.08 8.22 8.25 8.26 '8.26 8.26 8.25 8.21 8.31 34 Recently offered issues........................... 9.34 9.41 8.49 8.09 8.19 8.29 8.22 '8.28 8.25 8.16 8.21 8.25 Common stocks Dividend/price ratio: 35 8.23 8.38 7.97 7.54 7.55 7.56 4.47 4.47 4.50 4.41 4.23 4.36 36 Common stocks...................................... 4.47 4.31 3.77 3.99 4.21 4.37 7.60 7.60 7.62 7.52 7.61 7.65 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 basis. 2 Averages of the most representative daily offering rates published by 9 Unweighted averages for all outstanding notes and bonds in maturity finance companies for varying maturities in this range. ranges shown, based on daily closing bid prices. “Long-term” includes 3 Beginning Aug. 15, 1974, the rate is the average of the midpoint of all bonds neither due nor callable in less than 10 years. the range of daily dealer closing rates offered for domestic issues; prior I o Yields on the more actively traded issues adjusted to constant data are averages of the most representative daily offering rate quoted by maturities by the U.S. Treasury, based on daily closing bid prices. dealers. II General obligations only, based on figures for Thursday, from 4 Weekly figures are 7-day averages of daily effective rates for the week Moody’s Investors Service. ending Wednesday; the daily effective rate is an average of the rates on 12 Twenty issues of mixed quality. a given day weighted by the volume of transactions at these rates. 13 Averages of daily figures from Moody’s Investors Service. 5 Averages of the daily midpoints as determined from the range of 14 Compilation of the Board of Governors of the Federal Reserve offering rates in the secondary market. System. 6 Posted rates, which are the annual interest rates most often quoted Issues included are long-term (20 years or more). New-issue yields are on new offerings of negotiable CD’s in denominations of $100,000 or based on quotations on date of offering; those on recently offered issues more. Rates prior to 1976 not available. Weekly figures are for Wednes­ (included only for first 4 weeks after termination of underwriter price day dates. restrictions), on Friday close-of-business quotations. Digitized for FRA7 ASvEeRrag es of daily quotations for the week ending Wednesday. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic Financial Statistics □ M ay 1977 1.37 STOCK MARKET Selected Statistics 1976 1977 Indicator 1974 1975 1976 Oct. Nov. Dec. Jan. Feb. Mar. Apr. Prices and trading (averages of daily figures) Common stock prices 1 New York Stock Exchange (Dec. 31,1965 == 50). 43.84 45.73 54.45 54.43 54.17 56.34 56.28 54.93 54.67 53.92 2 Industrial..................................................... 48.08 51.88 60.44 60.07 59.45 61.54 61.26 59.65 59.56 58.47 3 Transportation........................................... 31.89 30.73 39.57 38.37 39.28 41.77 41.93 40.59 40.52 41.51 4 Utility........................................................... 29.82 31.45 36.97 38.33 38.85 40.61 41.13 40.86 40.18 40.24 5 Finance......................................................... 49.67 46.62 52.94 52.74 53.25 57.45 57.86 55.65 54.84 54.30 6 Standard and Poor’s Corporation (1941-43= 10)1 82.85 85.17 102.01 101.89 101.19 104.66 103.81 100.96 100.57 99.05 7 American Stock Exchange (Aug. 31,1973 = 100). 79.97 83.15 101.63 98.99 99.20 104.06 111.04 112.17 111.77 111.70 Volume of trading (thousands of shares)2 8 New York Stock Exchange..................... 13,883 18,568 21,189 17,397 19,370 23,621 23,562 19,310 17,814 17,380 9 American Stock Exchange...................... 1,908 2,150 2,565 1,700 2,211 3,095 3,268 2,830 2,580 2,500 Customer financing (end-of-period balances, in millions of dollars) 10 Regulated margin credit at brokers/dealers and banks3................................................ 4,836 6,500 8,995 8,772 '8,640 8,995 9,289 11 Brokers, total..................................................... 3,980 5,540 8,166 7,704 7,790 8,166 8,469 8,679 8,891 12 Margin stock4.............................................. 3,840 5,390 7,960 7,530 7,610 7,960 8,270 8,480 8,690 13 Convertible bonds....................................... 137 147 204 '169 178 204 196 197 199 14 Subscription issues...................................... 3 3 2 6 2 2 3 2 2 15 Banks, total....................................................... 856 960 829 1,068 r850 829 820 830 796 16 Margin stocks............................................... 815 909 786 1,019 '801 786 776 786 754 17 Convertible bonds........................................ 30 36 29 34 35 '29 27 27 25 18 Subscription issues...................................... 11 15 14 15 14 14 17 17 17 19 Unregulated nonmargin stock credit at banks5 2,064 2,281 3,684 2,774 3,737 3,684 3,693 3,751 3,720 Memo: Free credit balances at brokers6 20 Margin-account................................................ 410 475 585 611 615 585 645 605 605 21 Cash-account.................................................... 1,425 1,525 1,855 1,580 1,740 1,855 1,930 1,815 1,720 Margin-account debt at brokers (percentage distribution, end of period) 22 Total............................................ 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 By equity class (in per cent):7 23 Under 40................................. 45.4 r24.0 '12.0 15.0 14.0 '12.0 15.0 18.0 16 24 40-49....................................... 23.0 28.8 '23.0 34.0 32.0 '23.0 23.0 23 23 25 50-59....................................... 13.9 22.3 35.0 25.6 27.0 35.0 35.0 35 37 26 60-69....................................... 8.8 11.6 15.0 12.7 13.0 15.0 13.0 12 12 27 70-79....................................... 4.6 6.9 8.7 7.2 8.0 8.7 8.0 7 7 28 80 or more............................. 4.3 5.3 6.0 5.7 6.0 6.0 6.0 5 5 Special miscellaneous-account balances at brokers (end of period) 29 Total balances (millions of dollars) 8... 7,010 7,290 8,776 8,560 8,576 8,776 9,073 9,172 9,355 Distribution by equity status (per cent) 30 Net credit status.................................... 41.1 43.8 41.3 42.7 41.1 41.3 42.3 42.8 42.3 Debit status, equity of— 31 60 per cent or more.......................... 32.4 40.8 47.8 45.3 46.8 47.8 46.7 45.6 46.0 32 Less than 60 per cent....................... 26.5 15.4 10.9 12.0 12.1 10.9 11.0 11.6 11.7 1 Effective July 1976 includes a new financial group, banks and in­ 5 Nonmargin stocks are those not listed on a national securities ex­ surance companies. With this change the index includes 400 industrial change and not included on the Federal Reserve System’s list of over-thestocks (formerly 425), 20 transportation (formerly 15 rail), 40 public counter margin stocks. At banks, loans to purchase or carry nonmargin utility (formerly 60), and 40 financial. stocks are unregulated; at brokers, such stocks have no loan value. 2 Based on trading for a 5 Vi-hour day. 6 Free credit balances are in accounts with no unfulfilled commitments 3 Margin credit includes all credit extended to purchase or carry to the brokers and are subject to withdrawal by customers on demand. stocks or related equity instruments and secured at least in part by stock. 7 Each customer’s equity in his collateral (market value of collateral Credit extended by brokers is end-of-month data for member firms of less net debit balance) is expressed as a percentage of current collateral the New York Stock Exchange; June data for banks are universe totals; values. all other data for banks are estimates for all commercial banks based on 8 Balances that may be used by customers as the margin deposit re­ data from a sample of reporting banks. quired for additional purchases. Balances may arise as transfers based In addition to assigning a current loan value to margin stock generally, on loan values of other collateral in the customer’s margin account or Regulations T and U permit special loan values for convertible bonds deposits of cash (usually sales proceeds) occur. and stock acquired through exercise of subscription rights. 4 A distribution of this total by equity class is shown below. Note.—For table on “Margin Requirements” see p. A-10, Table 1.161. 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 1977 1975 1976 Account July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Savings and loan associations 1 295.545 338.233 391.999 371.770 376.188 379.747 385,013 389,173 391,999 398,299 403,591 409,299 2 Mortgages.............................. 249,301 278,590 323,130 303,527 307,766 311,847 315,742 319,273 323,130 326,056 329,086 333,623 3 Cash and investment securities1........................... 23,251 30,853 35,660 35,968 35,815 35,209 36,442 36,605 35,660 38,252 39,505 39,685 4 Other..................................... 22,993 28,790 33,209 32,275 32,607 32,691 32,829 33,295 33,209 33,991 35,000 35,991 5 Liabilities and net worth.... 295.545 338.233 391.999 371.770 376.188 379.747 385,013 389,173 391,999 398,299 403,591 409,299 6 Savings capital....................... 242,974 285,743 336,030 316,072 318,227 323,800 327,252 329,833 336,030 341,211 344,616 352,131 7 Borrowed money.................... 24,780 20,634 19,087 18,360 18,856 19,083 18,810 18,715 19,087 18,455 18,256 18,291 8 FHLBB................................. 21,508 17,524 15,708 15,139 15,495 15,832 15,636 15,571 15,708 15,029 14,661 14,329 9 Other................................... 3,272 3,110 3,379 3,221 3,361 3,251 3,174 3,144 3,379 3,426 3,595 3,962 10 Loans in process................... 3,244 5,128 6,836 6,572 6,628 6,688 6,735 6,753 6,836 6,718 6,783 7,341 11 Other......................................... 6,105 6,949 8,015 9,756 11,197 8,779 10,531 11,918 8,015 9,667 11,418 8,837 12 Net worth2............................. 18,442 19,779 22,031 21,010 21,280 21,398 21,685 21,954 22,031 22,248 22,518 22,699 Memo: 13 Mortgage loan commitments outstanding 3................ 7,454 10,673 14,828 16,301 15,773 15,449 15,319 15,467 14,828 15,079 16,796 19,257 Mutual savings banks 14 Assets....................... 109,550 121,056 134,702 129,826 130,571 131,413 132,455 133,361 134,812 135,906 137,307 Loans: 15 Mortgage................... 74,891 77,221 81,554 79,398 79,781 80,145 80,543 80,884 81,630 81,826 81,982 16 Other........................... 3,812 4,023 5,192 5,341 5,210 5,478 5,549 5,801 5,183 5,956 6,254 Securities: 17 U.S. Govt................... 2,555 4,740 5,911 5,640 5,733 5,851 5,796 5,836 5,840 5,917 6,096 18 State and local government. 930 1,545 2.420 2,376 2,339 2,359 2,429 2,466 2,417 2,295 2,366 19 Corporate and other4........ 22,550 27,992 33,676 32,028 32,319 32,432 32,793 33,074 33,793 34,475 35,088 20 Cash.......................................... 2,167 2,330 2,374 1,538 1,552 1,581 1,695 1,668 2,355 1,800 1,835 21 Other assets.............................. 2,645 3,205 3,574 3,505 3,576 3,567 3,649 3,632 3,593 3,637 3,686 22 Liabilities.................................. 109,550 121,056 134,702 129,826 130,571 131,413 132,455 133,361 134,812 135,906 137,307 23 Deposits.................................... 98,701 109,873 122,802 117,883 118,225 119,590 120,360 120,971 122,877 123,864 124,728 24 Regular:5.............................. 98,221 109,291 121,874 116,895 117,203 118,510 119,346 120,125 121,961 122,874 123,721 25 Ordinary savings............. 64,286 69,653 74,483 73,223 72,872 73,484 73,610 73,857 74,535 74,621 75,038 26 Time and other............... 33,935 39,639 47,391 43,662 44,331 45,027 45,736 46,268 47,426 48,253 48,683 27 Other..................................... 480 582 928 988 1,022 1,080 1,014 846 916 989 1,007 28 Other liabilities....................... 2,888 2,755 2,853 3,161 3,490 2,898 3,140 3,376 2,884 2,940 3,368 29 General reserve accounts.... 7,961 8,428 9,047 8,781 8,855 8,925 8,955 9,015 9,052 9,102 9,211 Memo: 30 Mortgage loan commitments outstanding 6................... 2,040 1,803 2,439 2,433 2,459 2,671 2,548 2,553 Life insurance companies 31 Assets....................... 263,349 289,304 320,555 307,005 309,295 312,044 313,960 316,505 320,555 322,489 324,164 Securities: 32 Government......... 10,900 13,758 17,270 16,672 16,902 16,862 17,329 17,565 17,270 17,549 17,817 33 United States7 3,372 4,736 5,156 5,150 5,922 5,150 5,448 5,606 5,156 5,291 5,382 34 State and local, 3,667 4,508 5,551 5,263 5,324 5,364 5,446 5,467 5,551 5,614 5,666 35 Foreign 8.......... 3,861 4,514 6,563 6,259 6,286 6,348 6,435 6,492 6,563 6,644 6,769 36 Business................ 119,637 135,317 157,625 148,617 150,303 152,125 153,298 154,502 157,625 159,464 160,683 37 Bonds............... 97,717 107,256 123,149 116,101 117,806 118,706 120,358 121,659 123,149 125,892 127,542 38 Stocks............... 21,920 28,061 34,476 32,516 32,497 33,419 32,940 32,843 34,476 33,572 33,141 39 Mortgages............... 86,234 89,167 91,581 89,753 89,891 90,217 90,323 90,808 91,581 91,615 91,646 40 Real estate............... 8,331 9,621 10,526 10,050 10,146 10,175 10,285 10,310 10,526 10,550 10,632 41 Policy loans............. 22,862 24,467 25,849 25,257 25,383 25,505 25,607 25,710 25,849 25,921 26,051 42 Other assets............. 15,385 16,971 17,704 16,656 16,670 17,160 17,118 17,610 17,704 17,390 17,335 Credit unions 43 Total assets/liabilities and capital............................. 31,948 38,037 44,897 41,729 42,266 43,079 43,415 44,089 44,835 44,906 45,798 47,111 44 Federal................................ 16,715 20,209 24,164 22,385 22,698 23,198 23,283 23,668 24,164 24,188 24,756 25,596 45 State.................................... 15,233 17,828 20,733 19,344 19,658 19,881 20,132 20,421 20,671 20,718 21,042 21,515 46 Loans outstanding................. 24,432 28,169 34,033 31,555 32,300 33,093 33,275 33,732 34,293 34,188 34,549 35,411 47 Federal................................ 12,730 14,869 18,022 16,614 17,065 17,458 17,522 17,786 18,202 18,081 18,275 18,776 48 State.................................... 11,702 13,300 16,011 14,941 15,235 15,635 15,753 15,946 16,091 16,107 16,274 16,635 49 Savings.................................... 27,518 33,013 39,264 36,615 36,752 37,436 37,854 38,281 38,968 39,344 39,981 41,161 50 Federal (shares)................ 14,370 17,530 21,149 19,663 19,783 20,167 20,358 20,597 20,980 21,165 21,559 22,346 51 State (shares and deposits) 13,148 15,483 18,115 16,952 16,969 17,269 17,496 17,684 17,988 18,179 18,442 18,815 For notes see bottom of page A30. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 Domestic Financial Statistics □ May 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 1977 1975 1976 Sept. 1976) H2 HI H2 Jan. Feb. Mar. U.S. Budget 1 Receipts................................................ 280,997 300,005 81,773 139,455 160,552 157,961 29,977 24,327 25,171 2 Outlays 1,2........................................... 326,105 366,466 94,746 185,097 181,369 193,719 32,640 30,880 34,646 3 Surplus, or deficit (—)................... -45,108 -66,461 -12,973 -45,642 -20,816 -35,758 -2,664 -6,554 -9,475 4 Trust funds...................................... 7,419 2,409 -1,952 -3,125 5,503 -4,621 -2,344 1,099 -1,441 5 Federal funds 3............................... -52,526 -68,870 -11,021 -42,517 -26,320 -31,137 -321 -7,654 -8,033 Off-budget entities surplus, or deficit (—) 6 Federal Financing Bank outlays... -6,389 -5,915 -2,575 -2,693 -3,222 -5,176 -1,009 -460 -843 7 Other i,4.............................................. -1,652 -1,355 793 -236 -1,119 3,809 -1,881 9 -83 U.S. Budget plus off-budget, in­ cluding Federal Financing Bank 8 Surplus, or deficit ( —)...................... -53,149 -73,731 -14,755 -48,571 -25,158 -37,125 -5,554 -7,005 -10,402 Financed by: 9 Borrowing from the public 2. . . 50,867 82,922 18,027 49,361 33,561 35,457 3,157 9,118 5,351 10 Cash and monetary assets (de­ crease, or increase ( —)) -320 -7,796 -2,899 -2,046 -7,909 2,153 -1,583 -1,194 5,610 11 Other 5............................................ 2,602 -1,396 -373 1,256 -495 -485 3,980 -920 -559 Memo: 12 Treasury operating balance (level, end of period)........................................ 7,591 14,836 17,418 8,452 14,836 11,670 12,688 14,599 9,028 13 F.R. Banks........................................ 5,773 11,975 13,299 7,286 11,975 10,393 11,397 12,179 7,150 14 Tax and loan accounts.................... 1,475 2,854 4,119 1,159 2,854 1,277 1,292 2,420 1,878 15 Other demand accounts 6............... 343 7 7 7 1 Outlay totals reflect the reclassification of the Export-Import Bank funds; miscellaneous liability (including checks outstanding) and asset from off-budget status to unified budget status. accounts; seignorage; increment on gold; net gain/loss for U.S. currency 2 Export-Import Bank certificates of beneficial interest (effective July valuation adjustment; net gain/loss for IMF valuation adjustment. 1, 1975) and loans to Pefco are treated as debt rather than asset sales. 6 Excludes the gold balance but includes deposits in certain commercial 3 Half years calculated as a residual of total surplus/deficit and trust depositories that have been converted from a time deposit to a demand fund surplus/deficit. deposit basis to permit greater flexibility in Treasury cash management. 4 Includes Pension Benefit Guaranty Corp., Postal Service Fund, Rural Electrification and Telephone Revolving Fund, Rural Telephone Bank, Source.—“Monthly Treasury Statement of Receipts and Outlays of and Housing for the Elderly or Handicapped Fund. the U.S. Government”, Treasury Bulletin, and U.S. Budget, Fiscal Year 5 Includes: Public debt accrued interest payable to the public; deposit 1978. NOTES TO TABLE 1.38 1 Stock of the Federal Home Loan Bank Board (FHLBB) is included Even when revised, data for current and preceding year are subject to in “other assets.” further revision. 2 Includes net undistributed income, which is accrued by most, but not Mutual savings banks: Estimates of National Association of Mutual all, associations. Savings Banks for all savings banks in the United States. Data are re­ 3 Excludes figures for loans in process, which are shown as a liability. ported on a gross-of-valuation-reserves basis. 4 Includes securities of foreign governments and international organiza­ Life insurance companies: Estimates of the Institute of Life Insurance tions and nonguaranteed issues of U.S. Govt, agencies. for all life insurance companies in the United States. Annual figures are 5 Excludes checking, club, and school accounts. annual-statement asset values, with bonds carried on an amortized basis 6 Commitments outstanding (including loans in process) of banks in and stocks at year-end market value. Adjustments for interest due and New York State as reported to the Savings Banks Assn. of the State of accrued and for differences between market and book values are not New York. made on each item separately but are included, in total, in “other assets.” 7 Direct and guaranteed obligations. Excludes Federal agency issues Credit unions: Estimates by the National Credit Union Administration not guaranteed, which are shown in this table under “business” securities. for a group of Federal and State-chartered credit unions that account for 8 Issues of foreign governments and their subdivisions and bonds of the about 30 per cent of credit union assets. Figures are preliminary and International Bank for Reconstruction and Development. revised annually to incorporate recent benchmark data. Note.—Savings and loan associations: Estimates by the FHLBB for all associations in the United States. Data are based on monthly reports of Federally insured associations and annual reports of other associations. 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 1977 1975 1976 Sept. 1976) H2 HI H2 Jan. Feb. Receipts 1 All sources.............................................. 280,997 300,005 81,773 139,455 160,552 157,961 29,977 24,327 25,171 2 Individual income taxes, net................ 122,386 131,603 38,801 65,835 65,767 75,094 18,108 8,515 6,131 3 Withheld............................................ 122,071 123,408 32,949 59,549 63,859 68,023 11,979 11,398 12,961 4 Presidential Election Campaign Fund........................................... 32 34 1 33 1 1 8 10 5 Non withheld...................................... 34,296 35,528 6,809 7,649 27,879 8,426 6,141 1,154 2,719 6 Refunds.............................................. 34,013 27,367 958 1,362 26,004 1,356 13 4,045 9,559 7 Corporation income taxes: 8 Gross receipts.................................... 45,747 46,783 9,808 18,810 27,973 20,706 2,007 1,311 9,131 9 Refunds.............................................. 5,125 5,374 1,348 2,735 2,639 2,886 313 363 412 10 Social insurance taxes and contribu­ tions, net......................................... 86,441 92,714 25,760 40,886 51,828 47,596 7,320 10,764 7,412 11 Payroll employment taxes and contributions 1.......................... 71,789 76,391 21,534 35,443 40,947 40,427 6,271 9,110 6,569 12 Self-employment taxes and contributions 1......................... 3,417 3,518 269 268 3,250 286 240 247 290 13 Unemployment insurance............... 6,771 8,054 2,698 2,861 5,193 4,379 347 997 126 14 Other net receipts 2......................... 4,466 A,152 1,259 2,314 2,438 2,504 462 410 428 15 Excise taxes............................................ 16,551 16,963 4,473 8,761 8,204 8,910 1,447 1,294 1,283 16 Customs.................................................. 3,676 4,074 1,212 1,927 2,147 2,361 381 347 466 17 Estate and gift....................................... 4,611 5,216 1,455 2,573 2,643 2,943 504 1,890 625 18 Miscellaneous receipts 3..................... 6,711 8,026 1,612 3,397 4,630 3,236 521 568 534 Outlays 19 All types 4.............................................. 326,105 366,466 94,746 185,097 181,369 193,719 32,640 30,880 34,646 20 National defense................................... 86,585 89,996 22,518 46,214 44,052 45,002 7,082 8,131 8,572 21 International affairs 4......................... 5,862 5,067 1,997 2,574 2,668 3,028 349 381 521 22 General science, space, and technology...................................... 3,989 4,370 1,161 2,415 1,708 2,377 304 333 403 23 Natural resources, environment, and energy...................................... 9,537 11,282 3,324 5,018 6,900 7,206 1,042 895 1,180 24 Agriculture............................................. 1,660 2,502 584 1,489 417 2,019 582 350 564 25 Commerce and transportation........... 16,010 17,248 4,700 11,496 5,766 9,643 681 -323 1,265 26 Community and regional development.................................. 4,431 5,300 1,530 2,548 2,411 3,192 397 480 496 27 Education, training, employment, and social services................. 15,248 18,167 5,013 8,423 9,116 9,083 1,541 1,585 1,645 28 Health.................................................... 27,647 33,448 8,720 16,681 17,008 19,329 2,961 3,064 2,674 29 Income security.................................... 108,605 127,406 32,796 61,655 65,336 65,456 11,652 11,719 13,045 30 Veterans benefits and services........... 16,597 18,432 3,962 9,010 9,450 8,542 1,630 1,606 1,611 31 Law enforcement and justice............. 2,942 3,320 859 1,589 1,784 1,839 340 244 292 32 General government............................. 3,089 2,927 878 1,929 870 1,734 93 285 284 33 Revenue sharing and general purpose fiscal assistance............. 7,005 7,119 2,024 3,528 3,664 4,729 2,062 44 31 34 Interest5.................................................. 30,974 34,589 7,246 15,180 18,560 18,409 2,382 2,674 2,522 35 Undistributed offsetting receipts 5,6 -14,075 -14,704 -2,567 -4,652 -8,340 -7,869 -460 -588 -459 1 Old-age, disability and hospital insurance, and Railroad Retirement 5 Effective September 1976, “Interest” and “Undistributed Offsetting accounts. Receipts” reflect the accounting conversion for the interest on special 2 Supplementary medical insurance premiums, Federal employee re­ issues for U.S. Govt, accounts from an accrual basis to a cash basis. tirement contributions and Civil Service retirement and disability fund. 6 Consists of interest received by trust funds, rents and royalties on 3 Deposits of earnings by F.R. Banks and other miscellaneous receipts. the Outer Continental Shelf, and U.S. Govt, contributions for em­ 4 Outlay totals reflect the reclassification of the Export-import Bank ployee retirement. from off-budget status to unified budget status. Export-import Bank certificates of beneficial interest (effective July 1, 1975) and loans to Pefco are treated as debt rather than asset sales. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 Domestic Financial Statistics □ M ay 1977 1.41 FEDERAL DEBT SUBJECT TO STATUTORY LIMIT Billions of dollars 1973 1974 1975 1976 Item June 30 Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Sept. 30 Dec. 31 1 Federal debt outstanding....................... 468.4 480.7 486.2 504.0 544.1 587.6 631.9 2646.4 665.5 2 Public debt securities.............................. 457.3 469.1 474.2 492.7 533.7 576.6 620.4 634.7 653.5 3 Held by public.................................... 333.9 339.4 336.0 351.5 387.9 437.3 470.8 488.6 506.4 4 Held by agencies................................ 123.4 129.6 138.2 141.2 145.3 139.3 149.6 146.1 147.1 5 Agency securities..................................... 11.1 11.6 12.0 11.3 10.9 10.9 11.5 11.6 12.0 6 Held by public.................................... 9.1 9.6 10.0 9.3 9.0 8.9 9.5 29.7 10.0 7 Held by agencies................................ 2.0 2.0 2.0 2.0 1.9 2.0 2.0 1.9 1.9 8 Debt subject to statutory limit.............. 459.1 470.8 476.0 493.0 534.2 577.8 621.6 635.8 654.7 9 Public debt securities............................. 456.7 468.4 473.6 490.5 532.6 576.0 619.8 634.1 652.9 10 Other debt1.............................................. 2.4 2.4 2.4 2.4 1.6 1.7 1.7 1.7 1.7 11 Memo: Statutory debt limit................. 465.0 475.7 495.0 495.0 577.0 595.0 636.0 636.0 682.0 1 Includes guaranteed debt of Govt, agencies, specified participation $0.5 billion due to a retroactive reclassification of the Export-Import Bank certificates, notes to international lending organizations, and District of certificates of beneficial interest from loan asset sales to debt, effective Columbia stadium bonds. July 1, 1975. 2 Gross Federal debt and Agency debt held by the public increased Source.—U.S. Treasury Bulletin. 1.42 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1976 1977 Type and holder 1973 1974 1975 Nov. Dec. Jan. Feb. Mar. Apr. 1 Total gross public debt1........................ 469.9 492.7 576.6 644.6 653.5 653.9 663.3 669.2 671.0 By type: 2 Interest-bearing debt............................... 467.8 491.6 575.7 643.6 652.5 653.0 662.3 668.2 668.5 3 Marketable.......................................... 270.2 282.9 363.2 415.4 421.3 424.0 431.6 435.4 434.1 4 Bills................................................... 107.8 119.7 157.5 161.7 164.0 164.0 164.2 164.3 162.0 5 Notes................................................ 124.6 129.8 167.1 213.0 216.7 219.5 225.9 229.6 230.7 6 Bonds................................................ 37.8 33.4 38.6 40.7 40.6 40.5 41.6 41.5 41.4 7 Nonmarketable2.................................. 197.6 208.7 212.5 228.2 231.2 229.0 230.7 232.8 234.4 8 Convertible bonds3....................... 2.3 2.3 2.3 2.3 2.3 2.3 2.3 2.2 2.2 9 Foreign issues4................................ 26.0 22.8 21.6 22.5 22.3 22.2 22.1 22.1 21.9 10 Savings bonds and notes.............. 60.8 63.8 67.9 71.9 72.3 72.6 73.0 73.4 73.9 11 Govt, account series5................... 108.0 119.1 119.4 127.4 129.7 126.8 127.8 128.2 129.0 By holder:6 12 U.S. Govt, agencies and trust funds 129.6 141.2 139.3 144.9 147.1 144.0 144.4 13 F.R. Banks.......................................... 78.5 80.5 87.9 91.7 97.0 94.1 95.8 14 Private investors.................................. 261.7 271.0 349.4 408.1 409.5 415.8 423.1 15 Commercial banks......................... 60.3 55.6 85.1 99.8 102.5 101.0 104.5 16 Mutual savings banks................... 2.9 2.5 4.5 5.3 5.5 5.6 5.7 17 Insurance companies..................... 6.4 6.1 9.3 12.2 12.3 12.2 12.2 18 Other corporations........................ 10.9 11.0 20.2 24.2 25.5 27.8 27.9 19 State and local governments .... 29.2 29.2 33.8 42.1 41.6 44.4 42.3 Individuals: 20 Savings bonds............................. 60.3 63.4 67.3 71.6 72.0 72.4 72.8 21 Other securities........................... 16.9 21.5 24.0 29.0 28.8 28.6 28.7 22 Foreign and international7.......... 55.5 58.4 66.5 76.0 78.1 80.3 82.3 23 Other miscellaneous investors8 . . 19.3 23.2 38.6 47.7 43.2 43.4 46.7 1 Includes $2.5 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 Apr. 30, 1977, 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 1 l/i porate pension trust funds, dealers and brokers, certain Govt, deposit per cent, 5-year marketable Treasury notes. Convertible bonds that have accounts, and Govt.-sponsored agencies. 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. Govt, 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 1977 1977 Type of holder 1975 1976 1975 1976 Feb. Mar. Feb. Mar. All maturities 1 to 5 years 1All holders....................................................................................... 363,191 421,276 431,607 435,379 112,270 141,132 143,927 43,204 2 U.S. Govt, agencies and trust funds......................................... 19,347 16,485 15,788 15,788 7,058 6,141 6,167 6,158 3 F. R. Banks.................................................................................... 87,934 96,971 95,837 95,987 30,518 31,249 31,076 30,966 4 Private investors............................................................................. 255,860 307,820 319,982 323,604 74,694 103,742 106,684 109,984 5 Commercial banks.................................................................... 64,398 78,262 79,706 80,133 29,629 40,005 42,533 42,980 6 Mutual savings banks............................................................... 3,300 4,072 4,304 4,519 1,524 2,010 2,114 2,186 7 Insurance companies................................................................ 7,565 10,284 10,121 10,091 2,359 3,885 3,765 3,827 8 Nonfinancial corporations...................................................... 9,365 14,193 16,367 14,284 1,967 2,618 3,884 3,708 9 Savings and loan associations................................................ 2,793 4,576 5,138 5,605 1,558 2,360 2,475 2,734 10 State and local governments.................................................. 9,285 12,252 12,883 12,625 1,761 2,543 2,746 2,848 11 All others.................................................................................... 159,154 184,182 191,463 196,347 35,894 50,321 49,168 51,701 Total, within 1 year 5 to 10 years 12 All holders....................................................................................... 199,692 211,035 217,404 218,080 26,436 43,045 43,223 43,204 13 U.S. Govt, agencies and trust funds......................................... 2,769 2,012 1,934 1,957 3,283 2,879 2,163 2,149 14 F. R. Banks..................................................................................... 46,845 51,569 49,528 49,695 6,463 9,148 9,856 9,901 15 150,078 157,454 165,942 166,428 16,690 31,018 31,204 31,154 16 Commercial banks.................................................................... 29,875 31,213 30,035 29,881 4,071 6,278 6,367 6,559 17 Mutual savings banks............................................................... 983 1,214 1,262 1,333 448 567 649 703 18 2,024 2,191 1,998 2,050 1,592 2,546 2,500 2,645 19 Nonfinancial corporations....................................................... 7,105 11,009 11,942 9,959 175 370 295 337 20 Savings and loan associations................................................ 914 1,984 2,404 2,627 216 155 188 174 21 State and local governments.................................................. 5,288 6,622 6,997 6,557 782 1,465 1,466 1,416 22 All others.................................................................................... 103,889 103,220 111,305 114,020 9,405 19,637 19,740 19,319 Bills, within 1 year 10 to 20 years 23 All holders....................................................................................... 157,483 163,992 164,175 164,264 14,264 11,865 11,764 11,718 24 U.S. Govt, agencies and trust funds......................................... 207 449 269 305 4,233 3,102 3,102 3,102 25 F. R. Banks.................................................................................... 38,018 41,279 38,865 39,455 1,507 1,363 1,371 1,380 26 Private investors............................................................................. 119,258 122,264 125,041 124,504 8,524 7,400 7,291 7,236 27 Commercial banks.................................................................. 17,481 17,303 14,314 13,974 552 339 322 322 28 Mutual savings banks............................................................... 554 454 426 436 232 139 136 136 29 Insurance companies................................................................. 1,513 1,463 1,128 1,123 1,154 1,114 1,339 1,084 30 Nonfinancial corporations....................................................... 5,829 9,939 10,628 8,745 61 142 169 191 31 Savings and loan associations................................................ 518 1,266 1,445 1,617 82 64 58 55 32 State and local governments.................................................. 4,566 5,556 5,689 5,287 896 718 700 663 33 All others.................................................................................... 88,797 86,282 91,410 93,322 5,546 4,884 4,567 4,785 Other, within 1 year Over 20 years 34 All holders...................................................................................... 42,209 47,043 53,229 53,816 10,530 14,200 15,288 15,269 35 U.S. Govt, agencies and trust funds......................................... 2,562 1,563 1,665 1,652 2,053 2,350 2,421 2,421 36 F. R. Banks.................................................................................... 8,827 10,290 10,663 10,240 2,601 3,642 4,006 4,045 37 Private investors............................................................................. 30,820 35,190 40,901 41,924 5,876 8,208 8,861 8,803 38 Commercial banks.................................................................... 12,394 13,910 15,721 15,907 271 427 449 390 39 Mutual savings banks............................................................... 429 760 836 897 112 143 143 162 40 Insurance companies................................................................ 511 728 870 927 436 548 519 485 41 Nonfinancial corporations....................................................... 1,276 1,070 1,314 1,214 57 55 77 89 42 Savings and loan associations................................................ 396 718 959 1,010 22 13 14 15 43 State and local governments.................................................. 722 1,066 1,308 1,270 558 904 975 1,140 44 All others.................................................................................... 15,092 16,938 19,895 20,698 4,420 6,120 6,684 6,522 Note.—Direct public issues only. Based on Treasury Survey of Owner­ banks, 467 mutual savings banks, and 725 insurance companies, each ship from Treasury Bulletin (U.S. Treasury Dept.). about 90 per cent; (2) 447 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 March 31, 1977; (1) 5,498 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 Domestic Financial Statistics □ M ay 1977 1.44 U.S. GOVERNMENT SECURITIES DEALERS Transactions Par value; averages of daily figures, in millions of dollars 1977 1977 Item 1974 1975 1976 Week ending Wednesday Jan. Feb. Mar. Mar. 23 Mar. 30 Apr. 6 Apr. 13 Apr. 20 Apr. 27 1 U.S. Govt, securities............... 3,579 6,027 10,449 12,502 12,871 11,128 10,517 10,738 11,057 11,306 15,260 14,798 By maturity: 2 Bills........................................ 2,550 3,889 6,676 7,630 7,593 7,445 7,048 7,094 7,690 7,111 9,502 9,302 3 Other within 1 year........... 250 223 210 156 283 234 235 245 175 207 163 285 4 1-5 years.............................. 465 1,414 2,317 2,805 3,262 2,373 2,351 2,088 1,628 2,283 3,366 3,365 5 5-10 years............................ 256 363 1,019 1,604 1,388 883 697 1,122 1,401 1,502 1,905 1,606 6 Over 10 years...................... 58 138 229 307 346 193 187 189 162 204 325 240 By type of customer: 7 U.S. Govt, securities dealers.......................... 652 885 1,360 1,641 1,537 1,492 1,553 1,456 1,390 1,749 1,603 1,301 8 U.S. Govt, securities brokers......................... 965 1,750 3,407 4,586 4,428 3,300 2,869 3,441 3,279 3,491 5,478 5,742 9 Commercial banks............. 998 1,451 2,426 2,884 3,013 2,528 2,503 2,194 2,417 2,489 3,047 2,884 10 All others1........................... 964 1,941 3,257 3,392 3,893 3,808 3,592 3,647 3,971 3,577 5,132 4,872 11 Federal agency securities.... 965 1,043 1,548 1,764 1,579 1,590 1,984 1,586 1,875 2,078 2,512 1,797 1 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 F.R. System. dealers reporting to the F.R. Bank of New York. The figures exclude allotments of, and exchanges for, new U.S. Govt, securities, redemptions Note.—Averages for transactions are based on number of trading days of called or matured securities, or purchases or sales of securities under in the period. repurchase, reverse repurchase (resale), or similar contracts. 1.45 U.S. GOVERNMENT SECURITIES DEALERS Positions and Sources of Financing Par value; averages of daily figures, in millions of dollars 1977 1977 1974 1975 1976 Week ending Wednesday Jan. Feb. Mar. Feb. 23 Mar. 2 Mar. 9 Mar. 16 Mar. 23 Mar. 30 Positions2 1 U.S. Govt, securities............... 2,580 5,884 7,592 8,914 6,251 5,266 6,295 5,431 5,791 5,828 5,273 3,770 2 Bills....................................... 1,932 4,297 6,290 6,596 4,646 4,864 5,325 4,511 5,439 5,525 5,000 3,298 3 Other within 1 year........... -6 265 188 138 193 237 211 221 184 224 276 292 4 1-5 years.............................. 265 886 515 1,270 587 -14 247 347 -38 -46 -94 13 5 5-10 years............................ 302 300 402 532 417 52 178 126 53 -9 1 65 6 Over 10 years...................... 88 136 198 379 407 128 334 226 153 135 91 103 7 Federal agency securities.... 1,212 943 729 923 466 383 482 421 394 468 394 216 Sources of financing3 8 All sources................................ 3,977 6,666 8,715 11,938 9,017 9,433 10,049 9,433 9,006 9,729 10,482 8,671 Commercial banks: 9 New York City................... 1,032 1,621 1,896 2,362 1,360 1,552 1,383 1,451 1,635 1,864 1,581 1,183 10 Outside New York City... 1,064 1,466 1,660 2,353 1,727 1,910 1,832 1,771 2,065 2,400 1,944 1,288 11 Corporations1......................... 459 842 1,479 2,141 2,038 2,131 2,187 2,173 2,301 2,372 2,050 1,851 12 All other.................................. 1,423 2,738 3,681 5,082 3,892 3,839 4,648 4,038 3,004 3,093 4,908 4,350 1A11 business corporations except commercial banks and insurance firms and dealer departments of commercial banks against U.S. Govt, companies. and Federal agency securities (through both collateral loans and sales 2 Net amounts (in terms of par values) of securities owned by nonbank under agreements to repurchase), plus internal funds used by bank dealer dealer firms and dealer departments of commercial banks on a commit­ departments to finance positions in such securities. Borrowings against ment, that is, trade-date basis, including any such securities that have been securities held under agreement to resell are excluded where the borrowing sold under agreements to repurchase. The maturities of some repurchase contract and the agreement to resell are equal in amount and maturity, agreements are sufficiently long, however, to suggest that the securities that is, a matched agreement. involved are not available for trading purposes. Securities owned, and hence dealer positions, do not include securities purchased under agree­ Note.—Averages for positions are based on number of trading days ments to resell. in the period; those for financing, on the number of calendar days in the 3 Total amounts outstanding of funds borrowed by nonbank dealer period. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A35 1.46 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt Outstanding Millions of dollars, end of period 1976 1977 Agency 1973 1974 1975 Sept. Oct. Nov. Dec. Jan. Feb. 1 Federal and Federally sponsored agencies............ 71,594 89,381 97,680 102,456 103,865 103,415 103,308 103,487 103,354 2 Federal agencies......................................................... 11,554 12,719 19,046 21,895 22,676 22,645 22,419 22,168 22,307 1,439 1,312 1,220 1,136 1,128 1,117 1,113 1,095 1,086 4 Export-import Bank 2,3........................................ 2,625 2,893 7,188 7,728 8,353 8,336 8,574 8,557 8,580 5 Federal Housing Administration4..................... 415 440 564 578 589 585 575 579 581 6 Government National Mortgage Association Participation Certificates5........................... 4,390 4,280 4,200 4,145 4,145 4,145 4,120 3,845 3,845 7 Postal Service6....................................................... 250 721 1,750 3,498 3,498 3,498 2,998 2,998 2,998 8 Tennessee Valley Authority................................ 2,435 3,070 3,915 4,713 4,865 4,865 4,935 4,985 5,005 9 United States Railway Association6................. 3 209 97 98 99 104 109 212 10 Federallv sponsored agencies.................................... 60,040 76,662 78,634 80,561 81,189 80,770 80,889 81,321 81,047 11 Federal home loan banks.................................... 15,362 21,890 18,900 17,061 17,122 16,807 16,811 16,805 16,587 12 Federal Home Loan Mortgage Corporation.. 1,784 1,551 1,550 1,150 1,150 1,150 1,150 1,350 1,350 13 Federal National Mortgage Association........ 23,002 28,167 29,963 30,685 30,656 30,413 30,565 30,394 30,143 14 Federal land banks............................................... 10,062 12,653 15,000 16,566 17,124 17,127 17,127 17,304 17,304 15 Federal intermediate credit banks..................... 6,932 8,589 9,254 10,791 10,712 10,669 10,494 10,631 10,556 16 Banks for cooperatives......................................... 2,695 3,589 3,655 3,901 4,023 4,207 4,330 4,425 4,695 17 Student Loan Marketing Association7............. 200 220 310 405 400 r395 410 410 410 18 Other........................................................................ 3 3 2 2 2 2 2 2 2 Memo: 19 Federal Financing Bank debt6,8............................. 4,474 17,154 25,888 26,636 27,028 28,711 29,848 30,328 Lending to Federal and Federally sponsored agencies: 20 Export-import Bank3.......................................... 4,595 4,768 4,768 4,768 5,208 5,208 5,237 21 Postal Service6....................................................... 500 1,500 3,248 3,248 3,248 2,748 2,748 2,748 22 Student Loan Marketing Association7............ 220 310 405 400 395 410 410 410 23 Tennessee Valley Authority................................ 895 1,840 2,738 2,810 2,890 3,110 3,160 3,180 24 United States Railway Association6................. 3 209 97 98 99 104 109 212 Other lending: 9 25 Farmers Home Administration......................... 2,500 7,000 9,650 10,250 10,250 10,750 11,450 11,450 26 Rural Electrification Administration................ 566 1,514 1,573 1,674 1,768 1,509 1,584 356 1,134 3,468 3,489 3,704 4,613 5,254 5,507 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 Aug. 17, 1974 through Sept. 30, 1976 on-budget thereafter. 8 The FFB, which began operations in 1974, is authorized to purchase 4 Consists of debentures issued in payment of Federal Housing Ad­ or sell obligations issued, sold, or guaranteed by other Federal agencies. ministration insurance claims. Once issued, these securities may be sold Since FFB incurs debt solely for the purpose of lending to other agencies, privately on the securities market. its debt is not included in the main portion of the table in order to avoid 5 Certificates of participation issued prior to fiscal 1969 by the Govern­ double counting. ment National Mortgage Association acting as trustee for the Farmers 9 Includes FFB purchases of agency assets and guaranteed loans; Home Administration; Department of Health, Education, and Welfare; the latter contain loans guaranteed by numerous agencies with the Department of Housing and Urban Development; Small Business Ad­ guarantees of any particular agency being generally small. The Farmers ministration; and the Veterans Administration. Home Administration item consists exclusively of agency assets, while the 6 Off-budget. Rural Electrification Administration entry contains both agency assets and guaranteed loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 Domestic Financial Statistics □ M ay 1977 1.47 NEW SECURITY ISSUES State and Local Government and Corporate Millions of dollars 1976 1977 Type of issue or issuer, 1974 1975 1976r or use Aug.r Sept.r Oct.r Nov. Dec. Jan. State and local government 1 24,315 30,607 35,313 2,829 2,819 3,544 3,345 2,352 3,428 Bv type of issue: 2 13,563 16,020 18,040 1,295 1,265 1,973 1,529 1,176 1,866 3 10,212 14,511 17,140 1,526 1,549 1,551 1,807 1,166 1,552 4 461 5 79 76 133 8 5 20 9 10 10 By type of issuer: 6 4,784 7,438 7,054 669 470 499 537 361 468 7 8,638 12,441 15,304 1,213 1,238 1,470 1,725 1,251 1,786 8 Municipalities, counties, townships, school districts.... 10,817 10,660 12,845 941 1,105 1,553 1,074 732 1,165 23,508 29,495 32,108 2,561 2,591 2,921 2,879 1,847 3,083 By use of proceeds: 10 4,730 4,689 4,900 373 356 428 351 334 489 11 1,712 2,208 2,586 170 251 332 221 107 104 12 5,634 7,209 9,594 814 747 632 1,333 723 1,050 13 3,820 4,392 6,566 714 767 676 574 233 483 14 494 445 483 27 31 23 69 63 15 15 7,118 10,552 7,979 463 439 830 331 387 942 Corporate 38,313 53,619 53,356 3,357 4,817 4,431 3,047 6,480 3,989 17 Bonds.............................................................................................. 32,066 42,756 42,262 2,679 4,263 3,482 2,357 5,560 3,387 By type of offering: 18 25,903 32,583 26,453 1,565 2,100 2,729 1,256 2,568 2,786 19 6,160 10,172 15,808 1,113 2,163 753 1,101 2,992 601 By industry group: 20 9,867 16,980 13,243 749 670 1,261 501 2,275 817 21 1,845 2,750 4,361 319 546 77 376 696 743 22 1,550 3,439 4,357 48 1,212 240 193 564 165 23 8,873 9,658 8,297 663 1,118 803 795 560 634 24 3,710 3,464 2,787 209 140 155 163 196 50 25 Real estate and financial........................................................ 6,218 6,469 9,222 692 577 946 328 1,271 979 6,247 10,863 11,094 678 554 949 690 920 602 By type: 27 2,253 3,458 2,789 214 136 276 282 308 103 28 3,994 7,405 8,305 464 418 673 408 612 499 By industry group: 29 544 1,670 2,237 282 83 88 9 110 89 30 940 1,470 1,183 69 33 73 34 198 136 31 Transportation....................................*................................... 22 1 24 13 7 32 Public utility ............................................................................. 3,964 6,235 6,101 257 347 611 532 596 352 33 217 1,002 776 3 27 34 Real estate and financial........................................................ 562 488 771 54 84 177 88 15 25 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. tha 3 n F i 1 g u y r e e a s r , , w so h l i d c h f o re r p c r a e s s h en i t n g th ro e s s U n p i r t o e c d e e S d ta s te o s f , i a s r s e u e p s r in m c a ip tu a r l i n a g m i o n u n m t o o re r As S s o o u ci r a c t e io s n .— ; c S o ta rp te o r a a n te d s l e o c c u a r l i ti g es o , v e S r e n c m ur e it n i t e s s e a c n u d r it E ie x s c , ha S n e g cu e ri C tie o s m I m n i d s u si s o tr n y . 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 1974 1975 1976 Q2 Q3 Q4 Ql Q2 Q3 Q4 All issues1 1New issues................................................................... 39,344 53,255 53,123 15,602 9,079 13,363 13,671 14,229 11,385 13,838 9,935 10,991 12,184 3,211 2,576 3,116 2,315 3,668 2,478 3,723 29,399 42,263 40,939 12,390 6,503 10,247 11,356 10,561 8,907 10,115 Bonds and notes 31,354 40,468 38,994 11,460 6,654 9,595 9,404 10,244 8,701 10,645 6,255 8,583 9,109 2,336 2,111 2,549 1,403 3,159 1,826 2,721 6 Net change: Total....................................................... 25,098 31,886 29,884 9,124 4,543 7,047 8,001 7,084 6,875 7,924 By industry: 7 Manufacturing.................................................... 7,404 13,219 8,978 4,574 1,442 2,069 2,966 1,529 1,551 2,932 8 Commercial and other2.................................... 1,116 1,605 2,259 483 221 528 203 726 610 720 9 341 2,165 3,078 429 147 1,588 985 488 1,092 513 10 Public utility....................................................... 7,308 7,236 6,829 1,977 1,395 1,211 1,820 1,260 2,109 1,640 11 3,499 2,980 1,687 810 472 429 498 953 335 -99 12 5,428 4,682 7,054 852 866 1,222 1,530 2,128 1,178 2,218 Common and preferred stock 7,980 12,787 14,129 4,142 2,425 3,768 4,267 3,985 2,684 3,193 3,678 2,408 3,075 875 465 567 912 509 652 1,002 15 Net change: Total....................................................... 4,302 10,377 11,055 3,266 1,960 3,200 3,355 3,477 2,032 2,191 By industry: 16 Manufacturing.................................................... 17 1,607 2,634 500 412 433 838 1,120 744 -68 17 Commercial and other2.................................... -135 1,137 762 490 108 462 88 318 117 239 18 Transportation, including railroad................. -20 65 96 7 53 4 5 25 17 49 19 Public utility....................................................... 3,834 6,015 6,171 1,866 1,043 1,537 2,174 1,300 932 1,765 20 Communication.................................................. 398 1,084 854 359 97 604 47 735 19 53 21 Real estate and financial.................................. 207 468 538 43 247 160 203 -21 203 153 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 1977 Item 1975 1976 Sept. Oct. Nov. Dec. Jan. Feb. Mar. INVESTMENT COMPANIES excluding money market funds 1 Sales of own shares1............................................ 3,302 4,226 338 378 446 661 655 423 463 2 Redemptions of own shares2............................ 3,686 6,802 573 450 419 628 628 463 553 3 Net sales................................................................. -384 2,496 -235 -72 27 33 141 -40 -90 4 42,179 47,537 46,138 44,858 45,369 47,537 45,760 '45,040 44,516 5 Cash position4.................................................. 3,748 2,747 2,507 2,434 2,635 2,747 2,958 '3,260 3,474 6 Other................................................................... 38,431 44,790 43,631 42,424 42,734 44,790 42,802 '41,780 41,042 1 Includes reinvestment of investment income dividends. Excludes 4 Also includes all U.S. Govt, securities and other short-term debt reinvestment of capital gains distributions and share issue of conversions 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 mem­ to 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 Financial Statistics □ M ay 1977 1.50 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1975 1976 Account 1974 1975 1976 Q2 Q3 Q4 Ql Q2 Q3 Q4' 1 Profits before tax.......................................................... 127.6 114.5 '147.9 105.8 126.9 131.3 141.1 146.2 150.2 154.2 2 Profits tax liability....................................................... 52.4 49.2 64.4 44.8 54.8 57.2 61.4 63.5 65.1 67.4 3 Profits after tax............................................................. 75.2 65.3 '83.5 61.0 72.1 '74.1 79.7 82.7 85.1 86.8 4 Dividends........................................................................ 30.8 32.1 35.2 31.9 32.6 32.2 33.1 34.4 35.4 37.7 5 Undistributed profits................................................... 44.4 33.2 '48.3 29.1 39.5 '41.9 46.6 48.3 49.7 49.1 6 Capital consumption allowances............................... 81.6 89.4 97.3 87.9 90.5 92.9 94.3 96.2 98.2 100.5 7 Net cash flow................................................................. 126.0 122.6 '145.6 117.0 130.0 '134.8 140.9 144.5 147.9 149.6 Source.—U.S. Dept, of Commerce, Survey of Current Business. 1.51 NONFINANCIAL CORPORATIONS Current Assets and Liabilities Billions of dollars, end of period 1975 1976 Account 1971 1972 1973 1974 Q3 Q4 Ql Q2 Q3 Q4 1 Current assets.............................................................. 529.4 574.4 643.2 712.2 716.5 731.6 753.5 775.4 791.8 816.8 2 Cash.......................................................................... 53.3 57.5 61.6 62.7 65.6 68.1 68.4 70.8 71.1 77.0 3 U.S. Govt, securities............................................. 11.0 10.2 11.0 11.7 14.3 19.4 21.7 23.3 23.9 26.4 4 Notes and accounts receivable.............................. 221.1 243.4 269.6 293.2 298.0 298.2 310.9 321.8 328.5 328.2 5 U.S. Govt, i......................................................... 3.5 3.4 3.5 3.5 3.3 3.6 3.6 3.7 4.3 4.3 6 Other..................................................................... 217.6 240.0 266.1 289.7 294.7 294.6 307.3 318.1 324.2 323.9 7 Inventories............................................................... 200.4 215.2 246.7 288.0 279.6 285.8 288.8 295.6 302.1 315.4 8 Other......................................................................... 43.8 48.1 54.4 56.6 59.0 60.0 63.6 63.9 66.3 69.8 9 Current liabilities......................................................... 326.0 352.2 401.0 450.6 444.7 457.5 465.9 475.9 484.1 499.9 10 Notes and accounts payable.................................. 220.5 234.4 265.9 292.7 279.6 288.0 286.9 293.8 291.7 302.9 11 U.S. Govt.1......................................................... 4.9 4.0 4.3 5.2 6.2 6.4 6.4 6.8 7.0 7.0 12 Other.................................................................... 215.6 230.4 261.6 287.5 273.4 281.6 280.5 287.0 284.7 295.9 13 Accrued Federal income taxes............................ 13.1 15.1 18.1 23.2 19.4 20.7 23.9 22.0 24.9 26.8 14 Other........................................................................ 92.4 102.6 117.0 134.8 145.6 148.8 155.0 160.1 167.5 170.2 15 Net working capital.................................................... 203.6 221.3 242.3 261.5 271.8 274.1 287.6 299.5 307.7 316.9 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 1977 Industry 1975 1976 Q3 Q4 Ql Q2 Q3 Q4 Ql Q22 112.75 120.82 112.16 111.80 114.72 118.12 122.55 125.22 129.19 132.71 Manufacturing 2 Durable goods industries...................................... 21.88 23.50 21.01 21.07 21.63 22.54 24.59 25.50 25.33 26.77 3 Nondurable goods industries.............................. 26.13 29.22 26.38 25.75 27.58 28.09 30.20 28.93 30.84 31.13 Nonmanufacturing 4 Mining...................................................................... 3.80 3.98 3.82 3.82 3.83 3.83 4.21 4.13 4.26 4.16 Transportation: 5 Railroad............................................................... 2.56 2.35 2.75 2.39 2.08 2.64 2.69 2.63 2.37 2.68 6 Air......................................................................... 1.87 1.31 2.12 1.65 1.18 1.44 1.12 1.41 1.76 1.45 7 Other..................................................................... 3.03 3.56 2.99 3.56 3.29 4.16 3.44 3.49 2.87 2.45 Public utilities: 8 Electric................................................................. 16.99 18.90 16.58 17.92 18.56 18.82 18.22 19.49 20.44 21.96 9 Gas and other..................................................... 3.14 3.47 3.21 3.00 3.36 3.03 3.45 3.96 4.08 4.24 1 11 0 C Co o m m m m e u r n c i i c a a l t a io n n d . . o ... t . h ... e .. r .. 1 .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 1 0 2 . . 6 7 1 6 2 1 0 2 . . 8 9 7 3 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 2 1 0 3 . . 9 6 9 4 2 1 1 4 . . 3 3 6 0 | 37.25 37.87 1 Includes trade, service, construction, finance, and insurance. agriculture; real estate operators; medical, legal, educational, and cultural 2 Anticipated by business. service; and nonprofit organizations. Note.—Estimates for corporate and noncorporate business, excluding 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 Financial Statistics □ M ay 1977 1.53 MORTGAGE MARKETS Millions of dollars, except as noted 1976 1977 Item 1974 1975 1976 Oct. Nov. Dec. Jan. Feb. Mar. Terms and yields in primary and secondary markets PRIMARY MARKETS Conventional mortgages on new homes Terms:1 1 Purchase price (thous. dollars)................. 40.1 44.6 48.4 49.0 48.6 51.0 52.5 r53.1 53.8 2 Amount of loan (thous. dollars)............. 29.8 33.3 35.9 36.2 36.0 37.1 39.0 '39.3 40.9 3 Loan/price ratio (per cent)....................... 74.3 74.7 74.2 75.3 75.6 74.7 76.3 '75.8 77.5 4 Maturity (years).......................................... 26.3 26.8 27.2 28.0 27.0 27.7 28.2 '27.8 28.0 5 Fees and charges (per cent of loan amount) 2. 1.30 1.54 1.44 1.38 1.36 1.38 1.38 '1.31 1.34 6 Contract rate (per cent per annum).... 8.71 8.75 8.76 8.85 8.83 8.87 8.82 '8.78 8.74 Yield (per cent per annum): 7 FHLBB series 3............................................ 8.92 9.01 8.99 9.07 9.05 9.10 9.05 '8.99 8.95 8 HUD series4.................................................. 9.22 9.10 8.99 9.00 8.95 8.90 8.80 8.85 SECONDARY MARKETS Yields (per cent per annum) on— 9 FHA mortgages (HUD series)5................ 9.55 9.19 8.82 8.55 8.45 8.25 8.40 8.50 8.58 10 GNMA securities6...................................... 8.72 8.52 8.17 7.98 7.93 7.59 7.85 7.98 8.06 FNMA auctions:7 11 Government-underwritten loans.......... '9.55 c9.26 8.92 8.75 8.66 8.45 8.48 8.55 8.68 12 Conventional loans................................. c9.65 c9. 38 9.12 9.05 9.00 8.84 8.82 8.86 8.91 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings at end of period: 13 Total......................................................................... 29,578 31,824 32,904 , 32,019 32,929 32,904 32,848 32,792 32,830 14 FHA-insured...................................................... 19,189 19,732 18,916 19,077 18,986 18,916 18,854 18,771 18,739 15 VA-guaranteed................................................... 8,310 9,573 9,212 9,314 9,264 9,212 9,162 9,115 9.099 16 Conventional...................................................... 2,080 2,519 4,776 3,628 4,679 4,776 4,833 4,906 4.992 Mortgage transactions during period: 17 Purchases................................................................. 6,953 4,263 3,606 162 1,131 191 141 150 283 18 Sales.......................................................................... 4 2 86 8 Mortgage commitments:8 19 Contracted during period.................................... 10,765 6,106 6,247 480 615 290 1,180 968 1,119 20 Outstanding at end of period............................. 7,960 4,126 3,398 3,672 3,649 3,398 4,142 4,707 5,184 Auction of 4-month commitments to buy— Government-underwritten loans: 21 Offered9............................................................... 5,492.7 7,042.8 4,929.8 235.5 494.1 56.9 747.4 868.4 1,138.2 22 Accepted............................................................. 2,371.4 3,848.3 2,787.2 107.1 221.1 41.5 549.1 484.7 612.0 Conventional loans: 23 Offered9............................................................... 1,206.8 1,401.1 2,595.7 297.5 353.3 150.2 326.8 300.0 373.9 24 Accepted............................................................. 656.4 765.2 1,879.3 215.8 296.9 135.4 238.3 235.8 268.1 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings at end of period:10 25 Total......................................................................... 4,586 4,987 4,269 4,190 4,162 4,269 3,896 3,672 3,557 26 FHA/VA............................................................. 1,904 1,824 1,618 1,660 1,638 1,618 1,594 1,580 1,564 2,682 3,163 2,651 2,530 2,523 2,651 2,302 2,092 1,993 Mortgage transactions during period: 28 Purchases................................................................. 2,191 1,716 1,175 78 101 208 16 98 200 29 Sales.......................................................................... 52 1,020 1,396 116 91 60 51 290 285 Mortgage commitments:11 30 Contracted during period.................................... 4,553 982 1,477 171 245 105 250 170 459 31 Outstanding at end of period.............................. 2,390 111 333 326 452 333 462 533 760 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 related requirements. Monthly 4 Average contract rates on new commitments for conventional first figures are unweighted averages for auctions conducted within the month. mortgages, rounded to the nearest 5 basis points; from Dept, of Housing 8 Includes some multifamily and nonprofit hospital loan commitments and Urban Development. in addition to 1- to 4-family loan commitments accepted in FNMA’s 5 Average gross yields on 30-year, minimum-downpayment, Federal free market auction system, and through the FNMA-GNMA Tandem Housing Administration-insured first mortgages for immediate delivery plans. in the private secondary market. Any gaps in data are due to periods of 9 Mortgage amounts offered by bidders are total bids received. adjustment to changes in maximum permissible contract rates. 10 Includes participations as well as whole loans. 6 Average net yields to investors on Government National Mortgage 11 Includes conventional and Government-underwritten loans. Association-guaranteed, mortgage-backed, fully-modified pass-through Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

R eal E state D ebt A41 1.54 MORTGAGE DEBT OUTSTANDING Millions of dollars End of year End of quarter Type of holder, and type of property 1976 1977 1972 1973 1974 1975 Q2 Q3 Q4 Q4 1All holders...................................................... 603,417 682,321 742,504 '801,640 '841,694 '866,283 '889,465 911,666 2 1- to 4-family............................................ 372,793 416,883 449,937 '491,568 '522,734 '542,170 '559,255 575,318 3 Multifamily................................................ 82,572 92,877 99,851 '100,471 '101,216 '101,566 '101,958 103,028 4 Commercial............................................... 112,294 131,308 146,428 '158,724 '163,616 '166,695 '170,753 174,049 5 Farm........................................................... 35,758 41,253 46,288 '50,877 '54,128 '55,852 '57,499 59,271 6 Maior financial institutions......................... 450,000 505,400 542,552 581,296 '611,802 '630,241 '647,314 662,023 7 Commercial banks1.................................. 99,314 119,068 132,105 136,186 '143,699 '147,636 '150,869 154,007 8 1- to 4-family........................................ 57,004 67,998 74,758 77,018 '82,900 '86,013 '87,897 89,725 9 Multifamily............................................ 5,778 6,932 7,619 5,915 '6,107 '6,201 '6,336 6,468 10 Commercial........................................... 31,751 38,696 43,679 46,882 '48,125 '48,749 '49,817 50,853 11 Farm....................................................... 4,781 5,442 6,049 6,371 '6,567 '6,673 '6,819 6,961 12 Mutual savings banks.............................. 67,556 73,230 74,920 77,249 r78,838 '80,249 ' 81,734 82,494 13 1- to 4-family........................................ 46,229 48,811 49,213 50,025 '51,326 '52,250 '53,217 53,712 14 Multifamily............................................ 10,910 12,343 12,923 13,792 '13,674 '13,915 '14,173 14,304 15 Commercial........................................... 10,355 12,012 12,722 13,373 '13,780 '14,028 '14,287 14,420 16 Farm....................................................... 62 64 62 59 '58 '56 '57 58 17 Savings and loan associations................. 206,182 231,733 249,293 278,693 299,574 312,139 323,130 333,623 18 1- to 4-family........................................ 167,049 187,750 201,553 224,710 241,996 252,521 261,732 270,235 19 Multifamily........................................... 20,783 22,524 23,683 25,417 26,722 27,468 28,116 29,025 20 Commercial........................................... 18,350 21,459 24,057 28,566 30,856 32,150 33,282 34,363 21 Life insurance companies......................... 76,948 81,369 86,234 89,168 89,691 90,217 91,581 91,899 22 1- to 4-family........................................ 22,315 20,426 19,026 17,590 16,861 16,458 '16,108 15,708 23 Multifamily............................................ 17,347 18,451 19,625 19,629 19,374 19,256 '19,201 19,191 24 Commercial........................................... 31,608 36,496 41,256 45,196 46,456 47,322 '48,854 49,362 25 Farm....................................................... 5,678 5,996 6,327 6,753 7,000 7,181 '7,418 7,638 26 Federal and related agencies...................... 40,157 46,721 58,320 66,891 66,033 67,314 '66,753 67,117 27 Government National Mortgage Assn... 5,113 4,029 4,846 7,438 5,557 5,068 4,241 4,004 28 1- to 4-family........................................ 2,513 1,455 2,248 4,728 3,165 2,486 1,970 1,682 29 Multifamily............................................ 2,600 2,574 2,598 2,710 2,392 2,582 2,271 2,322 30 Farmers Home Admin.............................. 1,019 1,366 1,432 1,109 830 1,355 1,064 1,378 31 1- to 4-family........................................ 279 743 159 208 228 754 454 657 32 Multifamily............................................ 29 29 167 215 46 143 218 328 33 Commercial........................................... 320 218 156 190 151 133 72 92 34 Farm....................................................... 391 376 350 496 405 325 320 301 35 Federal Housing and Veterans Admin... 3,338 3,476 4,015 4,970 5,111 5,092 5,150 5,406 36 1- to 4-family........................................ 2,199 2,013 2,009 1,990 1,781 1,716 1,676 1,732 37 Multifamily............................................ 1,139 1,463 2,006 2,980 3,330 3,376 3,474 3,674 38 Federal National Mortgage Assn........... 19,791 24,175 29,578 31,824 32,028 32,962 32,904 32,830 39 1- to 4-family........................................ 17,697 20,370 23,778 25,813 26,112 27,030 26,934 26,836 40 Multi family............................................ 2,094 3,805 5,800 6,011 5,916 5,932 5,970 5,994 41 Federal land banks.................................... 9,107 11,071 13,863 16,563 17,978 18,568 ' 19,125 19,942 42 1- to 4-family........................................ 13 123 406 549 575 586 '601 611 43 Farm....................................................... 9,094 10,948 13,457 16,014 17,403 17,982 18,524 19,331 44 Federal Home Loan Mortgage Corp— 1,789 2,604 4,586 4,987 4,529 4,269 4,269 3,557 45 1- to 4-family........................................ 1,754 2,446 4,217 4,588 4,166 3,917 3,889 3,200 46 Multifamily........................................... 35 158 369 399 363 352 380 357 47 Mortgage pools or trusts2........................... 14,404 18,040 23,799 34,138 41,225 44,960 49,801 54,811 48 Government National Mortgage Assn... 5,504 7,890 11,769 18,257 23,634 26,725 30,572 34,260 49 1- to 4-family........................................ 5,353 7,561 11,249 17,538 22,821 25,841 29,583 33,190 50 Multifamily........................................... 151 329 520 719 813 884 989 1,070 51 Federal Home Loan Mortgage Corp... 441 766 757 1,598 2,153 2,506 2,671 3,570 52 1- to 4-family........................................ 331 617 608 1,349 1,831 2,141 2,282 3,112 53 Multifamily............................................ 110 149 149 249 322 365 389 458 54 Farmers Home Admin.............................. 8,459 9,384 11,273 14,283 15,438 15,729 16,558 16,981 55 1- to 4-family........................................ 5,017 5,458 6,782 9,194 9,670 9,587 10,219 10,423 56 Multifamily............................................ 131 138 116 295 541 535 532 530 57 Commercial........................................... 867 1,124 1,473 1,948 2,104 2,291 2,440 2,560 58 Farm....................................................... 2,444 2,664 2,902 2,846 3,123 3,316 3,367 3,468 59 Individuals and others3................................ 98,856 112,160 117,833 '119,315 '122,634 '123,768 '125,597 127,715 60 1- to 4-family........................................ 45,040 51,112 53,331 '56,268 '59,302 '60,870 '62,693 64,495 61 Multifamily............................................ 21,465 23,982 24,276 '22,140 '21,616 '20,557 '19,909 19,307 62 Commercial........................................... 19,043 21,303 23,085 '22,569 '22,144 '22,022 '22,001 22,399 63 Farm....................................................... 13,308 15,763 17,141 '18,338 '19,572 '20,319 '20,994 21,514 1 Includes loans held by nondeposit trust companies but not bank trust Note.—Based on data from various institutional and Govt, sources, departments. with some quarters estimated in part by Federal Reserve in conjunction 2 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 Financial Statistics □ M ay 1977 1.55 CONSUMER INSTALMENT CREDIT Total Outstanding, and Net Change Millions of dollars 1976 1977 Holder, and type of credit 1974 1975 1976 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Amounts outstanding (end of period) 1 155,384 162,237 178,775 172,918 173,930 175,333 178,775 177,975 178,252 179,695 By holder: ? Commercial banks............................ 75,846 78,703 85,379 83,714 84,152 84,278 85,379 85,051 85,005 85,916 3 Finance companies........................... 36,208 36,695 39,642 38,575 38,809 39,129 39,642 39,665 39,831 39,889 4 Credit unions...................................... 22,116 25,354 30,546 29,600 29,711 30,053 30,546 30,410 30,701 31,448 5 Retailers1............................................ 17,933 18,002 19,178 17,012 17,205 17,726 19,178 18,693 18,322 18,068 6 Others2................................................ 3,281 3,483 4,030 4,017 4,053 4,147 4,030 4,156 4,393 4,374 By type of credit: 7 Automobile.......................................... 50,392 53,028 60,498 59,270 59,717 60,002 60,498 60,349 60,774 61,841 8 Commercial banks........................ 30,994 31,534 35,313 34,701 35,009 35,095 35,313 35,284 35,492 36,232 9 Indirect........................................ 18,687 18,353 19,642 19,495 19,611 19,575 19,642 19,566 19,640 20,005 10 Direct.......................................... 12,306 13,181 15,671 15,206 15,398 15,520 15,671 15,719 15,852 16,227 11 Finance companies....................... 10,618 11,439 13,059 12,808 12,901 12,957 13,059 12,973 13,042 13,084 12 Credit unions.................................. 8,414 9,653 11,633 11,270 11,311 11,442 11,633 11,579 11,690 11,976 13 Others.............................................. 366 402 493 491 496 508 493 513 550 549 Mobile homes: 14 Commercial banks........................ 8,972 8,704 8,233 8,340 8,294 8,254 8,233 8,146 8,094 8,076 15 Finance companies....................... 3,524 3,451 3,277 3,319 3,309 3,295 3,277 3,248 3,207 3,197 16 7,754 8,004 8,773 8,665 8,726 8,790 8,773 8,736 8,750 8,816 17 Commercial banks........................ 4,694 4,965 5,381 5,318 5,359 5,388 5,381 5,340 5,307 5,343 Revolving credit: 18 Bank credit cards.......................... 8,281 9,501 11,075 10,153 10,232 10,329 11,075 10,996 10,820 10,705 19 Bank check credit......................... 2,797 2,810 3,010 2,922 2,933 2,935 3,010 3,031 3,039 3,030 20 73,664 76,738 83,910 80,249 80,719 81,728 83,910 83,469 83,568 84,031 21 Commercial banks, total............. 20,108 21,188 22,368 22,280 22,325 22,277 22,368 22,254 22,253 22,531 22 Personal loans........................... 13,771 14,629 15,606 15,450 15,534 15,517 15,606 15,569 15,590 15,769 23 Finance companies, total............. 21,717 21,655 23,178 22,316 22,469 22,748 23,178 23,319 23,454 23,480 24 Personal loans............................ 16,961 17,681 19,043 18,371 18,509 18,773 19,043 19,002 18,998 19,048 25 Credit unions.................................. 13,037 14,937 17.993 17,438 17,505 17,706 17,993 17,915 18,086 18,524 26 Retailers.......................................... 17,933 18,002 19,178 17,012 17,205 17,726 19,178 18,693 18,322 18,068 27 Others............................................... 869 956 1,193 1,203 1,215 1,271 1,193 1,288 1,453 1,428 Net change (during period)3 28 Total......................................................... 8,952 6,843 16,539 1,481 1,564 1,243 1,823 1,918 2,022 2,717 By holder: 29 Commercial banks............................ 3,975 2,851 6,678 697 671 381 913 565 829 1,462 30 Finance companies............................ 806 483 2,946 233 317 245 364 481 442 373 31 Credit unions...................................... 2,507 3,238 5,192 483 280 395 537 416 540 717 32 Retailers.............................................. 1,538 69 1,176 24 263 98 64 249 118 238 33 Others................................................... 126 202 547 45 33 124 -55 207 93 -72 By type of credit: 34 Automobile.......................................... 327 2,631 7,470 605 528 477 1,013 758 884 1,201 35 Commercial banks........................ -508 535 3,779 376 350 221 652 418 504 759 36 Indirect........................................ -310 -340 1,289 125 117 70 330 160 239 385 37 Direct.......................................... -198 875 2,490 251 233 151 322 258 265 373 38 Finance companies....................... -100 821 1,620 28 77 98 146 99 161 194 39 Credit unions.................................. 958 1,239 1,980 172 105 144 207 174 213 267 40 Other................................................ -23 36 91 28 -4 14 8 66 6 -19 Mobile homes: 41 Commercial banks........................ 632 -268 -471 -53 -56 -43 32 -43 -26 16 42 Finance companies....................... 168 -73 -174 -16 -16 -16 -16 -18 -43 3 43 Home improvement............................ 804 248 768 65 73 103 73 130 73 97 44 Commercial banks........................ 611 271 416 43 44 55 54 36 14 75 Revolving credit: 45 Bank credit cards.......................... 1,443 1,220 1,576 166 123 71 -33 28 170 293 46 Bank check credit......................... 543 14 199 17 27 6 7 41 32 38 47 5,036 3,072 7,172 698 884 645 747 1,023 931 1,069 48 Commercial banks, total............. 1,255 1,080 1,180 148 183 72 199 85 134 281 49 Personal loans............................ 898 858 977 108 161 47 148 101 114 200 50 Finance companies, total............. 803 -64 1,523 223 258 163 236 401 320 175 51 Personal loans........................... 479 717 1,362 198 237 161 113 178 129 168 52 Credit unions................................. 1,473 1,900 3,056 297 166 239 313 227 312 428 53 Retailers.......................................... 1,538 69 1,176 24 263 98 64 249 118 238 54 Others.............................................. -33 87 237 5 15 73 -66 60 48 -54 1 Excludes 30-day charge credit held by retailers, oil and gas companies, Note.—Total consumer noninstalment credit outstanding—credit and travel and entertainment companies. scheduled to be repaid in a lump sum, including single-payment loans, 2 Mutual savings banks, savings and loan associations, and auto dealers. charge accounts, and service credit—amounted to $39.0 billion at the 3 Net change equals extensions minus liquidations (repayments, charge- end of 1976, $35.0 billion at the end of 1975, and $33.4 billion at the end offs, and other credits); figures for all months are seasonally adjusted. of 1974. Comparable data for Dec. 31, 1977, will be published in the Bulletin for February 1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Consum er D ebt A43 1.56 CONSUMER INSTALMENT CREDIT Extensions and Liquidations Millions of dollars 1976 1977 Holder, and type of credit 1974 1975 1976 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Extensions1 1Total......................................................... 160,008 163,483 186,221 15,775 16,055 15,763 16,702 16,870 17,186 18,253 By holder: 2 72,605 77,131 88,666 7,546 7,618 7,486 8,182 7,546 8,055 8,715 3 35,644 32,582 35,956 3,072 3,148 3,059 3,157 3,431 3,437 3,559 4 22,403 24,151 28,829 2,424 2,350 2,395 2,688 2,683 2,743 2,978 5 Retailers2............................................ 27,034 27,049 29,569 2,463 2,673 2,467 2,480 2,775 2,603 2,817 6 2,322 2,570 3,201 271 266 356 194 436 347 185 By type of credit: 7 43,209 48,103 55,807 4,769 4,587 4,632 5,263 4,940 5,205 5,654 8 Commercial banks........................ 26,406 28,333 32,687 2,846 2,770 2,691 3,170 2,892 3,075 3,350 9 Indirect........................................ 15,576 15,761 17,600 1,511 1,479 1,426 1,723 1,544 1,641 1,818 10 10,830 12,572 15,087 1,335 1,291 1,265 1,446 1,349 1,435 1,532 11 Finance companies....................... 8,630 9,598 11,210 891 904 927 992 964 999 1,151 12 Credit unions.................................. 7,788 9,702 11,336 963 875 957 1,051 974 1,075 1,124 13 Others.............................................. 385 470 574 69 37 57 51 110 55 30 Mobile homes: 14 Commercial banks........................ 3,486 2,681 2,449 200 178 207 267 195 207 254 15 Finance companies....................... 1,413 111 690 53 59 54 53 50 52 57 16 Home improvement............................ 4,571 4,398 5,034 434 463 464 461 494 457 478 17 Commercial banks........................ 2,789 2,722 3,036 266 282 216 288 262 251 308 Revolving credit: 18 Bank credit cards.......................... 17,098 20,428 25,481 2,165 2,198 2,181 2,217 2,117 2,332 2,434 19 Bank check credit......................... 4,227 4,024 4,832 375 413 410 426 462 448 456 20 86,004 83,079 91,928 7,779 8,158 7,815 8,015 8,612 8,484 8,920 21 Commercial banks, total............. 18,599 18,944 20,182 1,693 1,777 1,721 1,815 1,618 1,742 1,913 22 Personal loans............................ 13,176 13,386 14,463 1,193 1,286 1,238 1,317 1,213 1,281 1,379 23 Finance companies, total............. 25,316 22,135 24,014 2,125 2,182 2,072 2,108 2,413 2,379 2,346 24 Personal loans............................ 16,691 17,333 19,610 1,745 1,776 1,696 1,688 1,787 1,843 1,814 25 Credit unions.................................. 14,228 13,992 16,911 1,410 1,426 1,389 1,582 1,656 1,612 1,792 26 Retailers.......................................... 27,034 27,049 29,569 2,463 2,673 2,467 2,480 2,775 2,603 2,817 27 Others.............................................. 827 959 1,253 87 100 166 30 151 149 52 Liquidations1 28 Total......................................................... 151,056 156,640 169,682 14,294 14,491 14,520 14,879 14,952 15,164 15,536 By holder: 29 Commercial banks............................ 68,630 74,280 81,988 6,849 6,947 7,105 7,269 6,981 7,227 7,253 30 Finance companies........................... 34,838 32,099 33,010 2,839 2,831 2,814 2,793 2,949 2,995 3,186 31 Credit unions...................................... 19,896 20,913 23,637 1,941 2,070 2,000 2,151 2,267 2,203 2,261 32 Retailers2............................................ 25,496 26,980 28,393 2,439 2,410 2,369 2,416 2,526 2,485 2,579 33 Others 3................................................ 2,196 2,368 2,654 226 233 232 249 228 254 257 By type of credit: 34 Automobile.......................................... 42,883 45,472 48,337 4,165 4,059 4,155 4,250 4,183 4,320 4,453 35 Commercial banks........................ 26,915 27,798 28,908 2,470 2,420 2,470 2,517 2,474 2,571 2,591 36 Indirect........................................ 15,886 16,101 16,311 1,386 1,363 1,356 1,393 1,384 1,402 1,432 37 Direct.......................................... 11,029 11,697 12,597 1,084 1,058 1,114 1,124 1,090 1,169 1,159 38 Finance companies....................... 8,730 8,777 9,590 862 827 829 846 866 838 957 39 Credit unions.................................. 6,830 8,463 9,356 791 770 813 843 800 862 857 40 Others.............................................. 408 434 483 42 42 43 43 43 49 49 Mobile homes: 41 Commercial banks........................ 2,854 2,949 2,921 253 233 250 234 238 233 238 42 Finance companies....................... 1,245 844 864 69 74 70 70 67 96 53 43 3,767 4,150 4,266 369 390 360 388 364 385 382 44 Commercial banks........................ 2,178 2,451 2,620 223 239 221 234 227 237 233 Revolving credit: 45 Bank credit cards.......................... 15,655 19,208 23,905 2,000 2,074 2,110 2,250 2,089 2,161 2,141 46 Bank check credit......................... 3,684 4,010 4,632 358 386 404 419 421 416 419 47 All other............................................... 80,969 80,007 84,757 7,081 7,274 7,170 7,268 7,590 7,553 7,850 48 Commercial banks, total............. 17,345 17,864 19,002 1,545 1,594 1,649 1,615 1,533 1,608 1,632 49 Personal loans............................ 12,278 12,528 13,486 1,085 1,125 1,191 1,169 1,111 1,167 1,179 50 Finance companies, total............ 24,513 22,199 22,491 1,902 1,924 1,909 1,872 2,012 2,059 2,171 51 Personal loans............................ 16,212 16,616 18,248 1,547 1,539 1,535 1,575 1,608 1,714 1,646 52 Credit unions.................................. 12,755 12,092 13,855 1,113 1,260 1,150 1,268 1,429 1,300 1,363 53 Retailers.......................................... 25,496 26,980 28,393 2,439 2,410 2,369 2,416 2,526 2,485 2,579 54 Others............................................... 860 872 1,016 82 86 93 96 90 101 105 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 Financial Statistics □ M ay 1977 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; half-year data are at seasonally adjusted annual rates. 1975 1976 Transaction category, or sector 1971 1972 1973 1974 1975 1976 HI H2 HI H2 Nonfinancial sectors 1 1 151.0 176.9 197.6 188.8 210.4 271.6 184.2 236.5 256.6 286.3 1 2 139.6 166.4 190.0 185.0 200.3 260.8 173.8 226.9 243.0 278.2 2 By sector and instrument: 3 U.S. Govt............................................................. 24.7 15.2 8.3 12.0 85.2 69.0 80.8 89.6 71.6 66.6 3 4 Public debt securities.................................... 26.0 14.3 7.9 12.0 85.8 69.1 82.0 89.7 71.5 66.9 4 5 Agency issues and mortgages..................... -1.3 1.0 .4 * -.6 -.1 -1.2 -.1 .1 -.3 5 6 126.3 161.7 189.4 176.8 125.2 202.6 103.4 146.9 185.0 219.7 6 7 Corporate equities......................................... 11.5 10.5 7.7 3.8 10.0 10.8 10.5 9.6 13.6 8.1 7 8 114.8 151.2 181.7 173.0 115.1 191.8 93.0 137.3 171.4 211.7 8 9 Private domestic nonfinancial sectors......... 121.1 157.7 183.1 161.6 112.2 181.1 94.9 129.4 169.1 192.5 9 10 Corporate equities..................................... 11.4 10.9 7.9 4.1 9.9 10.5 10.3 9.5 13.3 7.7 10 11 109.7 146.8 175.3 157.5 102.3 170.5 84.6 119.9 155.8 184.8 11 12 Debt capital instruments....................... 86.8 102.8 106.7 101.2 101.3 123.6 97.5 105.1 113.5 133.8 12 13 State and local obligations............. 17.5 15.4 16.3 19.6 17.3 17.2 16.2 18.4 18.1 16.4 13 14 Corporate bonds................................ 18.8 12.2 9.2 19.7 27.2 22.8 33.4 21.0 20.7 25.0 14 Mortgages: 15 28.6 42.6 46.4 34.6 40.8 64.4 33.5 48.1 58.1 70.7 15 16 Multifamily residential................. 9.7 12.7 10.4 7.0 -.1 1.1 * -.2 1.6 .6 16 17 Commercial.................................... 9.8 16.4 18.9 15.1 10.9 11.7 8.7 13.1 9.8 13.5 17 18 Farm................................................ 2.4 3.6 5.5 5.1 5.2 6.4 5.6 4.8 5.1 7.6 18 19 Other debt instruments.......................... 22.8 44.0 68.6 56.3 1.0 46.9 - 12.8 14.8 42.3 51.0 19 7.0 Consumer credit................................ 11.6 18.6 21.7 9.8 8.5 20.5 1.1 16.0 19.4 21.6 20 71 Bank loans n.e.c................................. 6.5 18.1 34.8 26.2 -14.5 7.7 -23.5 -5.5 2.2 12.7 21 22 Open market paper........................... -.4 .8 2.5 6.8 -2.2 3.5 -.2 -4.2 8.2 -1.3 22 23 Other................................................... 5.1 6.5 9.6 13.5 9.1 15.3 9.7 8.5 12.6 17.9 23 24 By borrowing sector................................... 121.1 157.7 183.1 161.6 112.2 181.1 94.9 129.4 169.1 192.5 24 25 State and local governments............... 17.8 15.2 14.8 18.6 14.9 16.8 13.9 15.9 16.4 17.2 25 26 42.1 64.8 73.5 45.2 49.7 90.7 39.0 60.4 88.3 93.0 26 27 Farm......................................................... 4.5 5.8 9.7 7.9 9.4 12.3 9.4 9.4 11.0 13.6 27 28 Nonfarm noncorporate........................ 10.3 13.1 12.3 6.7 1.2 4.7 -.8 3.2 4.2 4.8 28 29 Corporate................................................ 46.4 58.8 72.9 83.1 37.1 56.6 33.5 40.6 49.3 63.9 29 3 31 0 Corporate equities..................................... 5.2 * - 4 . . 4 0 - 6 . . 2 2 1 - 5 . . 2 3 13. .1 0 21. . 5 3 8. . 5 1 17. .1 4 15. . 9 3 27. .3 2 3 31 0 32 5.2 4.4 6.4 15.5 12.8 21.2 8.4 17.3 15.6 26.9 32 33 Bonds....................................................... .9 1.0 1.0 2.1 6.2 8.4 5.7 6.1 7.3 9.4 33 34 Bank loans n.e.c..................................... 2.1 3.0 2.8 4.7 4.0 6.8 .6 1A 4.2 9.3 34 35 Open market paper............................... .3 -1.0 .9 7.1 -.1 2.5 -1.2 1.0 .8 4.2 35 36 U.S. Govt, loans.................................... 1.8 1.5 1.7 1.6 2.8 3.6 3.3 2.2 3.2 4.0 36 Financial sectors 17.0 29.1 56.7 43.0 14.8 29.8 14.4 15.3 27.5 32.1 37 By instrument: 38 5.9 8.4 19.9 23.1 13.5 17.7 14.0 13.1 18.0 17.4 38 39 Sponsored credit agency securities............. 1.1 3.5 16.3 16.6 2.3 2.4 1.4 3.3 3.9 .9 39 4 41 0 Mortgage pool securities............................. 4.8 4.9 3.6 5. . 8 7 10. . 3 9 1 - 5 . . 4 7 11 1 . . 5 1 9. . 2 6 14.2 * 1 - 7 .7 .2 4 4 1 0 42 Private financial sectors.................................... 11.1 20.7 36.8 19.9 1.3 12.1 .4 2.1 9.5 14.7 42 43 Corporate equities......................................... 3.5 2.8 1.5 1.0 1.2 1.8 1.2 1.2 .3 3.3 43 44 Debt instruments............................................. 7.6 18.0 35.3 18.9 .1 10.3 -.8 1.0 9.1 11.4 44 45 3.8 5.1 3.5 2.1 2.9 5.8 2.5 3.3 1.2 4.4 45 46 2.1 1.7 -1.2 -1.3 2.3 1.9 1.2 3.4 1.0 2.8 46 47 3.5 6.8 14.0 7.5 -3.9 -3.3 -4.7 -3.2 -3.6 -3.0 47 4 4 9 8 Open market paper and Rp’s................. -2. . 7 9 4.4 ♦ 1 7 1 . . 2 8 6 3 . . 7 9 -4 2 . . 0 8 -2 7 . . 0 8 -7 7 . . 3 6 -1 — . . 9 6 -2 6 . . 3 8 -1 8 . . 7 8 4 4 8 9 By sector: 50 Sponsored credit agencies................................ 1.1 3.5 16.3 17.3 3.2 2.0 2.5 4.0 3.9 .2 50 51 Mortgage pools.................................................. 4.8 4.9 3.6 5.8 10.3 15.7 11.5 9.2 14.2 17.2 51 52 11.1 20.7 36.8 19.9 1.3 12.1 .4 2.1 9.5 14.7 52 53 2.4 4.8 8.1 -1.1 1.7 7.6 5.7 -2.3 9.9 5.3 53 54 Bank affiliates............................................... -.4 .7 2.2 3.5 .3 -.8 .9 -.3 -1.3 -.3 54 55 1.6 .8 5.1 2.9 -.3 .4 -.9 .2 -1.5 2.4 55 56 Savings and loan associations..................... -.1 2.0 6.0 6.3 -2.1 - .1 -7.8 3.6 -1.0 .7 56 57 Other insurance companies......................... .6 .5 .5 .9 .9 1.0 .9 1.0 1.0 1.0 57 58 Finance companies........................................ 2.7 6.2 9.4 4.5 .7 6.1 -.8 2.1 6.0 6.2 58 59 REIT’s............................................................. 2.9 6.3 6.5 1.1 -1.9 -2.1 -1.6 -2.2 -1.8 -2.5 59 60 Open-end investment companies............... 1.3 -.5 -1.2 -.5 .8 .3 1.5 .1 -1.1 1.8 60 61 2.4 1.3 - .3 2.6 - .7 .2 61 All sectors AO Tnfol fun He raicprl hv instruniAnt....................... 168.1 206.0 254.3 231.8 225.2 301.4 198.6 251.8 284.1 318.4 62 63 Investment company shares............................ 1.3 -.5 -1.2 -.5 .8 .3 1.5 .1 -1.1 1.8 63 64 Other corporate equities.................................. 13.7 13.8 10.4 5.4 10.4 12.3 10.2 10.7 15.0 9.6 64 65 Debt instruments................................................. 153.1 192.8 245.2 227.0 214.0 288.7 187.0 241.0 270.2 307.0 65 66 U S Govt, securities..................................... 30.7 23.7 28.3 34.5 98.0 87.2 93.6 102.4 89.8 84.7 66 67 State and local obligations.......................... 17.5 15.4 16.3 19.6 17.3 17.2 16.2 18.4 18.1 16.4 67 68 Corporate and foreign bonds..................... 23.5 18.4 13.6 23.9 36.3 37.0 41.6 31.0 35.2 38.8 68 69 Mortgages....................................................... 52.5 76.8 79.9 60.5 59.0 85.4 49.1 69.0 75.7 95.2 69 70 Consumer credit............................................ 11.6 18.6 21.7 9.8 8.5 20.5 1.1 16.0 19.4 21.6 70 71 Bank loans n.e.c............................................. 12.1 27.8 51.6 38.4 -14.4 11.2 -27.6 -1.2 2.9 19.1 71 72 Open market paper and Rp’s..................... .9 4.1 15.2 17.8 .5 13.8 6.2 -5.1 15.8 11.8 72 73 Other loans..................................................... 4.2 8.0 18.5 22.5 8.7 16.5 6.8 10.7 13.4 19.5 73 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, except as noted; half-year data are at seasonally adjusted annual rates. 1975 1976 Transaction category or sector 1971 1972 1973 1974 1975 1976 HI H2 HI H2 1 Total funds advanced in credit markets to nonfinancial sectors........................................ 139.6 166.4 190.0 185.0 200.3 260.8 173.8 226.9 243.0 278.2 1 By public agencies and foreign: 2 Total net advances.................................................. 43.4 19.8 34.2 52.7 44.2 55.9 51.9 36.6 50.5 61.2 2 3 U.S. Govt, securities......................................... 34.4 1.6 9.6 11.9 22.5 26.8 32.6 12.4 26.7 26.9 3 4 Residential mortgages...................................... 7.0 7.0 8.2 14.7 16.2 12.8 15.9 16.5 10.8 14.8 4 -2.7 * 7.2 6.7 -4.0 -2.0 -7.3 -.6 -2.3 -1.7 5 6 Other loans and securities............................... 4.6 5.1 9.2 19.5 9.5 18.2 10.6 8.3 15.3 21.1 6 Totals advanced, by sector 7 U.S. Govt............................................................. 2.8 1.8 2.8 9.8 15.1 10.2 14.9 15.2 5.6 14.9 7 8 Sponsored credit agencies................................ 5.2 9.2 21.4 25.6 14.5 20.6 15.9 13.2 20.0 21.3 8 9 Monetary authorities........................................ 8.9 .3 9.2 6.2 8.5 9.8 7.0 10.1 13.6 6.1 9 10 Foreign................................................................. 26.4 8.4 .7 11.2 6.1 15.2 14.2 -2.0 11.4 19.0 10 11 Agency borrowing not included in line 1......... 5.9 8.4 19.9 23.1 13.5 17.7 14.0 13.1 18.0 17.4 11 Private domestic funds advanced 12 Total net advances.................................................. 102.1 155.0 175.7 155.3 169.6 222.6 135.9 203.4 210.5 234.4 12 13 U.S. Govt, securities......................................... -3.7 16.1 18.7 22.6 75.5 60.4 61.0 90.0 63.1 57.8 13 14 State and local obligations.............................. 17.5 15.4 16.3 19.6 17.3 17.2 16.2 18.4 18.1 16.4 14 15 Corporate and foreign bonds......................... 19.5 13.1 10.0 20.9 32.8 30.3 38.9 26.7 27.0 33.5 15 16 Residential mortgages...................................... 31.2 48.1 48.5 26.9 24.4 52.7 17.7 31.1 48.9 56.4 16 17 Other mortgages and loans............................. 35.0 62.3 89.3 71.9 15.7 60.1 -5.2 36.5 51.1 68.6 17 18 Less: FHLB advances...................................... -2.7 * 7.2 6.7 -4.0 -2.0 -7.3 -.6 -2.3 -1.7 18 Private financial intermediation 19 Credit market funds advanced by private financial institutions....................................... 109.7 149.4 163.8 126.2 116.0 181.8 97.7 134.3 161.9 201.1 19 20 Commercial banks............................................ 50.6 70.5 86.5 64.6 27.6 57.7 13.5 41.7 41.5 73.6 20 21 Savings institutions............................................ 39.1 47.2 36.0 27.0 51.0 69.7 49.8 52.2 71.0 68.2 21 22 Insurance and pension funds.......................... 14.2 17.8 23.8 30.1 39.3 44.2 36.4 42.3 44.3 44.2 22 23 Other finance...................................................... 5.9 13.8 17.4 4.5 -1.8 10.1 -1.9 -1.8 5.1 15.1 23 24 Sources of funds...................................................... 109.7 149.4 163.8 126.2 116.0 181.8 97.7 134.3 161.9 201.1 24 25 Private domestic deposits................................ 89.4 100.9 86.4 69.4 90.5 122.1 90.3 90.6 103.8 141.4 25 26 Credit market borrowing................................. 7.6 18.0 35.3 18.9 .1 10.3 -.8 1.0 9.1 11.4 26 27 Other sources...................................................... 12.6 30.5 42.1 37.8 25.4 48.8 8.2 42.7 49.0 48.3 27 28 Foreign funds................................................. -3.9 5.3 6.9 14.5 -.4 2.5 -5.7 5.0 -2.7 1.1 28 2.2 .7 -1.0 -5.1 -1.7 -.1 -3.5 .1 3.9 -4.2 29 30 Insurance and pension reserves.................. 8.6 11.6 18.4 26.0 29.9 34.3 27.4 32.5 33.6 35.0 30 31 Other, net........................................................ 5.7 12.8 17.8 2.4 -2.4 12.1 -10.1 5.2 14.2 9.9 31 Private domestic nonfinancial investors 32 Direct lending in credit markets........................... * 23.6 47.2 40.8 53.7 51.1 37.4 70.1 57.7 44.7 32 33 U.S. Govt, securities......................................... -10.8 4.2 19.4 17.9 23.0 19.6 5.0 41.0 21.5 11.6 33 34 State and local obligations.............................. .5 3.1 7.5 12.2 9.9 1.1 10.3 9.6 6.0 8.2 34 35 Corporate and foreign bonds......................... 8.3 4.2 .9 5.3 10.4 5.9 12.9 7.9 8.2 3.6 35 36 Commercial paper............................................. -1.1 3.0 12.5 4.6 3.1 6.3 3.5 2.7 10.6 2.0 36 37 Other.................................................................... 3.2 9.1 6.9 8.1 7.3 12.2 5.6 8.9 11.3 13.2 37 38 Deposits and currency............................................ 92.8 105.3 90.3 75.7 96.7 130.0 95.7 97.7 107.9 151.9 38 39 Time and saving accounts.................................. 79.1 83.7 76.2 67.4 84.8 113.2 75.0 94.7 97.9 128.5 39 40 Large negotiable CD’s................................. 6.3 1.1 18.3 18.9 -13.3 -14.1 -27.3 .1 -17.9 -10.3 40 41 Other at commercial banks......................... 33.2 30.6 29.6 26.1 39.0 58.1 39.4 38.5 50.0 66.2 41 42 At savings institutions.................................. 39.6 45.4 28.4 22.4 59.2 69.2 63.0 55.4 65.7 72.7 42 43 Money................................................................... 13.7 21.6 14.1 8.3 11.9 16.8 20.7 3.0 10.1 23.3 43 44 Demand deposits........................................... 10.4 17.2 10.2 2.0 5.7 9.5 15.3 -4.0 5.9 12.9 44 45 Currency.......................................................... 3.4 4.4 3.9 6.3 6.2 7.3 5.4 7.1 4.2 10.5 45 46 Total of credit market instruments, deposits and currency.................................................... 92.9 129.0 137.5 123.7 150.4 181.2 133.1 167.8 165.6 196.5 46 47 Public support rate (in per cent).................... 31.1 11.9 18.0 28.5 22.1 21.4 29.9 16.1 20.8 22.0 47 48 Private financial intermediation (in per cent) 107.4 96.4 93.2 81.2 68.4 81.6 71.9 66.0 76.9 85.8 48 49 Total foreign funds............................................ 22.5 13.7 7.6 25.7 5.7 17.7 8.5 3.0 8.7 26.6 49 Memo: Corporate equities not included above 50 Total net issues....................................................... 15.0 13.3 9.2 4.9 11.2 12.7 11.7 10.8 14.0 11.4 50 1.3 -.5 -1.2 -.5 .8 .3 1.5 .1 -1.1 1.8 51 52 Other equities..................................................... 13.7 13.8 10.4 5.4 10.4 12.3 10.2 10.7 15.0 9.6 52 53 Acquisitions by financial institutions................. 17.8 15.3 13.3 5.5 8.3 12.0 9.2 7.4 11.8 12.1 53 54 Other net purchases........................................... -2.9 -2.1 -4.1 -.7 2.9 .7 2.4 3.4 2.1 -.7 54 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 and net issues of Federally related mortgage pool securities. Included includes mortgages. below in lines 3, 13, and 33. 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. Note.—Full statements for sectors and transaction types quarterly, 28. Foreign deposits at commercial banks, bank borrowings from foreign and annually for flows and for amounts outstanding, may be obtained branches, and liabilities of foreign banking agencies to foreign af­ from Flow of Funds Section, Division of Research and Statistics, Board filiates. of Governors of the Federal Reserve System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics □ M ay 1977 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures 1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted. 1976 1977 1974 1975 1976 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. 1 Industrial production. 129.3 117.8 129.8 130.8 130.4 131.8 133.1 132.1 133.2 135.0 136.1 Market groupings: Products, total............. 129.3 119.3 129.3 129.7 129.6 131.7 133.8 133.1 133.8 135.2 135.8 Final, total............... 125.1 118.2 127.3 127.4 127.4 129.8 132.1 130.8 131.7 133.4 134.1 Consumer goods. 128.9 124.0 136.8 136.2 136.9 139.1 142.0 140.2 141.1 143.3 143.8 Equipment........... 120.0 110.2 114.3 115.2 114.4 116.9 118.6 117.8 118.6 119.5 120.8 Intermediate............. 135.3 123.1 136.8 138.7 138.3 138.8 139.8 141.8 141.7 141.4 142.1 Materials....................... 132.4 115.5 130.5 132.5 131.6 131.9 131.9 130.7 132.6 134.7 136.3 Industry groupings: Manufacturing___ 129.4 116.3 129.4 130.7 129.9 131.9 132.8 131.5 132.9 134.8 135.9 Capacity utilization (per cent)1 in- 9 Manufacturing................................ 84.2 73.6 80.1 80.4 79.7 80.8 81.2 80.2 80.8 81.8 82.2 10 Industrial materials industries... 87.7 73.6 80.3 81.0 80.3 80.3 80.1 79.1 80.1 81.2 82.0 11 Construction contracts2. 173.9 162.3 190.2 182.0 237.0 186.0 183.0 203.0 207.0 207.0 12 Nonagricultural employment, total3.......... 119.1 116.9 120.6 121.4 121.2 121.6 122.0 122.3 122.7 123.6 124.0 13 Goods-producing, total.......................... 106.2 96.9 100.3 100.8 100.2 100.9 101.0 101.3 101.9 103.1 103.8 14 Manufacturing, total........................... 103.1 94.3 97.5 98.2 97.4 98.0 98.2 98.8 98.9 99.8 100.2 15 Manufacturing, production-worker. 102.1 91.3 95.2 96.1 94.9 95.6 95.7 96.5 96.5 97.6 98.1 16 Service-producing.................................... 126.1 127.8 131.7 132.6 132.7 132.9 133.5 133.8 134.1 134.7 135.0 17 Personal income, total4.................................................. 184.1 199.4 219.1 222.1 224.9 226.8 229.7 230.0 233.7 237.2 239.0 18 Wages and salary disbursements............................. 178.9 188.7 208.3 209.9 211.3 213.2 217.6 218.4 221.5 224.8 227.1 19 Manufacturing............................................................. 157.6 157.9 176.7 178.9 179.1 182.4 184.1 185.0 188.4 192.6 194.6 20 Disposable personal income. 180.5 198.5 217.0 218.1 234.2 21 Retail sales5............................ 171.2 186.0 206.6 206.7 208.8 212.3 221.2 216.5 222.3 227.0 227.0 Prices:6 22 Consumer. 147.7 161.2 170.5 172.6 173.3 173.8 174.3 175.3 177.1 178.2 179.6 23 Wholesale. 160.1 174.1 182.9 184.7 185.2 185.6 187.1 188.0 190.0 191.9 194.3 1 Ratios of indexes of production to indexes of capacity. Based on data 5 Based on Bureau of Census data published in Survey 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 M anpower A47 2.11 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION Seasonally adjusted 1976 1977 1976 1977 1976 1977 Series Q2 Q3 Q4 Qlr Q2 Q3 Q4 Ql Q2 Q3 Q4 Qlr Output (1967 = 100) Capacity (per cent of 1967 output) Utilization rate (per cent) 1 Manufacturing.................................................. 129.4 131.1 131.5 133.1 161.3 162.3 163.2 164.3 80.2 80.8 80.6 81.0 2 Primary processing...................................... 136.6 139.3 138.9 139.8 167.5 168.8 170.1 171.4 81.5 82.5 81.7 81.5 3 Advanced processing.................................. 125.2 126.3 127.5 129.4 158.0 158.8 159.6 160.6 r79.2 79.6 79.9 80.6 130.3 132.6 131.8 132.7 161.7 163.1 164.3 165.5 80.6 81.3 80.2 80.2 5 Durable goods.............................................. 126.1 130.7 128.4 128.8 165.5 166.7 167.8 169.0 76.2 78.4 76.5 76.2 6 110.8 117.1 107.7 107.6 143.1 143.7 144.4 144.8 77.4 81.5 74.6 74.3 7 Nondurable goods...................................... 146.9 146.6 147.0 149.0 171.0 172.5 174.1 175.6 85.9 85.0 84.4 84.9 8 Textile, paper, and chemical................ 151.6 151.2 151.5 153.5 178.3 180.1 182.0 183.6 85.0 84.0 83.2 83.6 9 115.5 114.4 111.7 111.1 139.0 139.8 140.6 141.4 83.1 81.8 79.4 78.6 10 Paper...................................................... 132.5 131.9 130.2 132.6 145.7 146.7 147.9 148.9 90.9 89.9 88.1 89.1 11 Chemical............................................... 175.3 175.1 177.6 180.6 208.7 211.2 213.7 216.2 84.0 82.9 83.1 83.5 12 Energy............................................................ 120.0 119.9 121.5 121.7 141.5 142.7 143.9 144.3 84.8 84.0 84.4 84.3 2.12 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data are seasonally adjusted; except as noted. 1976 1977 Category 1974 1975 1976 Oct. Nov. Dec. Jan. Feb. Mar.p Apr.p Household survey data 1 Noninstitutional population1................ 150,827 153,449 156,048 156,788 157,006 157,176 157,381 157,584 157,782 157,986 2 Labor force (including Armed Forces)1........................................... 93,240 94,793 96,917 97,449 98,020 98,106 97,649 98,282 98,677 98,892 3 Civilian labor force............................... 91,011 92,613 94,773 95,302 95,871 95,960 95,516 96,145 96,539 96,760 Employment: 4 Nonagricultural industries2........ 82,443 81,403 84,188 84,428 84,972 85,184 85,468 85,872 86,359 86,763 5 Agriculture...................................... 3,492 3,380 3,297 3,310 3,248 3,257 3,090 3,090 3,116 3,260 Unemployment: 6 Number........................................... 5,076 7,830 7,288 7,564 7,651 7,517 6,958 7,183 7,064 6,737 7 Rate (per cent of civilian labor force)........................................ 5.6 8.5 7.7 7.9 8.0 7.8 7.3 7.5 7.3 7.0 8 Not in labor force.................................. 57,587 58,655 59,130 59,339 58,986 59,071 59,732 59,302 59,104 59,094 Establishment survey data 9 Nonagricultural payroll employment3 78,413 77,050 79,443 79,819 80,106 80,344 80,561 '80,824 81,372 81,644 10 Manufacturing.................................... 20,046 18,347 18,958 18,941 19,065 19,095 19,211 '19,233 19,399 19,481 11 Mining................................................. 694 745 783 800 805 808 817 '823 840 848 12 Contract construction....................... 3,957 3,515 3,593 3,582 3,619 3,605 3,561 '3,645 3,746 3,822 13 Transportation and public utilities. 4,696 4,499 4,508 4,506 4,519 4,553 4,549 '4,553 4,567 4,575 14 Trade.................................................... 17,017 16,997 17,694 17,824 17,808 17,898 17,981 '18,067 18,172 18,196 15 Finance................................................ 4,208 4,222 4,315 4,359 4,381 4,403 4,423 '4,431 4,450 4,467 16 Service.................................................. 13,617 14,008 14,645 14,819 14,873 14,936 15,010 15,068 15,153 15,200 17 14,177 14,773 14,947 14,988 15,036 15,046 15,009 '15,004 15,045 15,055 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. Based on data from Employment unpaid family workers, and members of the Armed Forces. Data are and Earnings (U.S. Dept, of Labor). adjusted to the February 1977 benchmark. Based on data from Employ- 2 Includes self-employed, unpaid family, and domestic service workers. ment and Earnings (U.S. Dept, of Labor). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 Domestic Nonfinancial Statistics □ M ay 1977 2.13 INDUSTRIAL PRODUCTION (1967 = 100) except as noted; monthly data are seasonally adjusted. 1967 1976 1977 Grouping pro­ 1976 por­ aver­ tion age Feb. Mar. Apr. Nov. Dec. Jan. Feb. Mar. Apr. Major market groupings 1 Total index................................................ 100.00 129.8 127.3 128.1 128.4 131.8 133.1 132.1 133.2 135.0 136.1 2 Products..................................................... 60.71 129.3 127.4 128.1 128.0 131.7 133.8 133.1 133.8 135.2 135.8 3 Final products........................................ 47.82 127.3 125.3 126.4 126.3 129.8 132.1 130.8 131.7 133.4 134.1 4 Consumer goods.............................. 27.68 136.8 134.9 136.1 136.1 139.1 142.0 140.2 141.1 143.3 143.8 5 Equipment......................................... 20.14 114.3 112.1 112.9 112.9 116.9 118.6 117.8 118.6 119.5 120.8 6 Intermediate products......................... 12.89 136.8 135.3 134.9 134.7 138.8 139.8 141.8 141.7 141.4 142.1 7 Materials.................................................... 39.29 130.5 127.3 128.2 129.2 131.9 131.9 130.7 132.6 134.7 136.3 Consumer goods 8 Durable consumer goods..................... 7.89 141.5 137.9 140.4 141.1 143.7 151.2 145.1 146.1 153.8 153.4 9 Automotive products...................... 2.83 154.8 148.9 155.1 155.2 161.6 180.4 164.0 161.6 180.0 176.3 10 Autos and utility vehicles.......... 2.03 149.9 142.0 149.5 152.1 154.6 180.1 155.8 152.7 177.1 171.2 11 Autos.......................................... 1.90 132.0 125.8 133.6 134.3 139.1 159.8 136.9 132.8 155.8 150.6 12 Auto parts and allied goods........ .80 167.2 166.5 169.5 163.1 179.3 181.7 184.9 184.0 187.5 189.0 13 Home goods...................................... 5.06 134.1 131.7 132.0 133.1 133.8 134.9 134.6 137.4 139.1 140.5 14 Appliances, A/C, and TV.......... 1.40 115.8 112.6 114.6 117.2 115.3 111.7 113.4 118.5 124.2 126.6 15 Appliances and TV................. 1.33 118.6 115.2 117.1 119.6 117.6 113.8 116.0 121.1 126.7 16 Carpeting and furniture............. 1.07 144.1 145.6 141.4 143.0 143.6 144.7 142.7 145.9 146.6 17 Misc. home goods....................... 2.59 139.9 136.3 137.9 137.8 139.9 143.6 142.8 144.1 144.0 145.0 18 Nondurable consumer goods............... 19.79 134.9 133.9 134.4 134.0 137.1 138.4 138.3 139.0 139.1 140.0 19 Clothing............................................. 4.29 126.9 127.6 130.1 129.6 126.4 126.4 124.2 125.2 20 Consumer staples............................. 15.50 137.2 135.7 135.5 135.2 140.0 141.7 142.2 142.7 143.0 144.0 21 Consumer foods and tobacco. . 8.33 130.8 129.9 129.1 128.4 132.5 132.8 132.9 134.8 135.9 22 Nonfood staples........................... 7.17 144.6 142.3 143.3 143.3 149.0 151.8 153.1 151.9 150.9 152.5 23 Consumer chemical products 2.63 166.6 161.1 163.6 162.1 174.4 177.9 178.5 175.7 176.4 24 Consumer paper products. . . 1.92 113.3 113.9 113.4 114.2 113.8 117.7 117.0 113.3 115.1 25 Consumer energy products. . 2.62 145.4 144.3 145.0 145.9 149.0 150.9 154.1 155.9 151.5 26 Residential utilities............. 1.45 153.7 153.7 154.5 Equipment 27 Business equipment............................... 12.63 136.1 132.6 134.0 134.1 140.2 143.2 142.0 143.0 144.6 145.7 28 Industrial equipment....................... 6.77 127.9 124.0 125.6 125.3 131.3 133.5 131.4 132.6 134.6 135.8 29 Building and mining equip........ 1.44 177.4 171.5 172.1 170.7 181.5 187.4 187.9 191.4 195.9 198.0 30 Manufacturing equipment......... 3.85 106.4 102.7 104.4 105.4 109.9 110.7 107.8 108.0 109.1 109.9 31 Power equipment......................... 1.47 135.3 133.1 135.6 132.7 138.0 140.0 137.5 139.3 141.6 142.5 32 Commercial transit, farm equip.., 5.86 145.5 142.4 143.7 144.6 150.5 154.4 154.5 155.0 156.3 157.2 33 Commercial equipment.............. 3.26 173.2 166.6 168.5 170.0 179.7 185.3 185.2 185.8 186.9 188.2 34 Transit equipment....................... 1.93 103.8 103.7 104.7 105.6 107.6 109.1 108.4 108.7 110.6 111.5 35 Farm equipment.......................... .67 130.6 135.3 134.7 132.7 132.2 134.8 138.0 137.7 138.6 36 Defense and space equipment............ 7.51 77.9 77.6 77.4 77.3 77.9 77.4 77.1 77.6 77.3 78.8 Intermediate products 37 Construction supplies......................... 6.42 132.0 129.6 128.7 128.0 135.7 135.5 136.1 135.7 136.0 136.9 38 Business supplies................................. 6.47 141.5 140.9 141.2 141.3 141.7 144.2 147.3 147.4 146.7 39 Commercial energy products........ 1.14 156.5 154.0 157.6 156.8 155.4 156.7 162.3 165.1 164.3 Materials 40 Durable goods materials..................... 20.35 126.6 121.6 122.4 124.5 128.5 128.3 126.8 128.5 131.2 133.0 41 Durable consumer parts................. 4.58 121.6 116.7 118.5 119.2 126.2 124.7 121.5 124.2 127.6 128.7 42 Equipment parts.............................. 5.44 133.9 127.5 128.5 130.5 137.2 138.8 135.1 137.3 137.7 138.9 43 Durable materials n.e.c................... 10.34 125.0 120.7 121.0 123.5 124.9 124.2 124.8 125.6 129.3 131.7 44 Basic metal materials................. 5.57 109.8 105.1 104.0 107.8 106.3 104.7 104.7 105.8 112.3 45 Nondurable goods materials............... 10.47 146.4 145.5 146.7 146.9 147.2 146.2 144.6 150.9 151.5 154.0 46 Textile, paper, and chem. mat.. .. 7.62 151.2 150.5 152.7 152.2 151.3 150.6 148.8 155.0 156.7 159.2 47 Textile materials.......................... 1.85 114.4 116.2 115.5 114.1 108.8 113.6 110.6 110.4 112.4 48 Paper materials............................ 1.62 131.1 130.0 130.1 132.1 131.0 127.6 127.6 133.5 136.8 49 Chemical materials..................... 4.15 175.5 173.9 178.0 177.2 178.3 176.3 174.2 183.3 184.3 50 Containers, nondurable................. 1.70 142.6 142.2 141.3 141.9 145.9 143.8 139.5 151.3 149.5 51 Nondurable materials n.e.c............ 1.14 120.0 117.3 115.1 120.4 122.2 119.7 122.6 122.4 120.8 52 Energy materials.................................. 8.48 120.3 118.8 119.6 118.8 121.7 123.1 122.6 119.9 122.5 53 Primary energy................................. 4.65 107.0 105.4 106.2 105.0 107.1 106.6 102.9 100.1 104.9 54 Converted fuel materials............... 3.82 136.4 135.2 136.0 135.7 139.5 143.2 146.5 143.9 143.8 Supplementary groups 55 Home goods and clothing................ 9.35 130.8 129.8 131.1 131.5 130.4 131.0 129.8 131.8 132.8 133.5 56 Energy, total......................................... 12.23 129.0 127.5 128.6 128.2 130.7 132.2 133.0 131.7 132.6 132.1 57 Products........................................... 3.76 148.8 147.1 148.8 149.3 150.9 152.7 156.5 158.7 155.4 58 Materials........................................... 8.48 120.3 118.8 119.6 118.8 121.7 123.1 122.6 119.9 122.5 For Note see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Output A49 2.13 Continued 1967 1976 1977 Grouping SIC pro­ 1976 code por­ aver­ tion age Feb. Mar. Apr. Nov. Dec. Feb. Mar. Apr, Gross value of products in market structure (annual rates, in billions of 1972 dollars) 1 Products, total........... 1507.4 550.6 544.3 546.2 545.0 588.3 570.6 564.2 570.5 577.6 579.4 2 Final products......... 1390.9 426.2 421.7 422.9 421.8 432.2 443.9 436.5 441.6 448.6 449.6 3 Consumer goods. 1277.5 302.9 300.6 299.8 299.9 307.4 315.7 309.3 313.5 317.6 318.1 4 Equipment........... 1113.4 123.5 121.1 123.5 122.1 125.0 128.2 127.2 128.1 130.8 131.4 5 Intermediate products. 1116.6 124.3 122.8 122.6 123.0 126.2 126.5 127.8 128.5 128.8 129.8 Major industry groupings 12.05 m .9 131.5 131.6 131.2 134.1 134.8 136.1 135.6 136.4 136.7 7 6.36 114.1 112.7 113.9 113.5 116.2 116.2 113.2 114.3 118.8 118.5 8 5.69 151.7 152.5 151.4 150.8 154.0 155.5 161.5 159.3 156.2 157.0 9 Electric....................................................... 3.88 168.7 167.3 165.7 10 Afanufacturine.................................................. 87.95 129.4 127.0 127.9 128.5 131.9 132.8 131.5 132.9 134.8 135.9 11 Nondurable................................................... 35.97 141.0 140.2 140.7 140.7 143.5 143.7 143.7 145.7 146.8 147.9 12 Durable......................................................... 51.98 121.4 117.9 119.0 120.1 123.8 125.2 123.0 123.9 126.4 127.5 Mining 13 Metal mining................................................ 10 .51 122.8 124.2 122.3 124.3 128.1 130.4 135.6 135.5 135.1 14 Coal................................................................ 11, 12 .69 116.9 109.6 114.4 114.4 125.1 125.9 95.3 100.8 124.1 118.4 15 Oil and gas extraction................................ 13 4.40 112.0 110.1 111.9 111.3 112.3 112.8 112.0 112.7 115.6 115.8 16 Stone and earth minerals........................... 14 .75 118.3 120.0 119.3 117.5 121.4 117.9 121.6 121.8 122.8 Nondurable manufactures 17 Foods............................................................. 20 8.75 132.0 130.8 128.3 129.2 134.7 134.3 135.5 137.6 138.8 18 Tobacco products........................................ 21 .67 117.2 118.8 122.4 115.4 119.7 119.1 114.8 110.3 19 Textile mill products.................................. 22 2.68 135.9 138.7 136.4 135.7 132.2 133.3 131.8 133.0 134.3 20 Apparel products........................................ 23 3.31 126.1 128.0 126.3 126.1 125.9 128.0 123.6 125.3 21 Paper and products.................................... 26 3.21 133.1 133.0 132.2 133.9 132.5 131.8 130.6 136.5 137.0 i38.i 22 Printing and publishing.............................. 27 4.72 120.7 121.0 121.0 122.0 119.3 123.1 124.3 123.0 123.0 123.2 23 Chemicals and products............................. 28 7.74 169.4 167.6 170.6 168.7 174.2 173.6 172.0 175.0 176.8 24 Petroleum products.................................... 29 1.79 132.7 129.1 131.8 131.6 135.8 138.9 141.0 145.4 144.9 145.5 25 Rubber & plastic products........................ 30 2.24 199.8 196.7 203.5 198.2 215.7 212.3 218.7 219.7 223.4 26 Leather and products.................................. 31 .86 82.0 86.1 86.0 87.7 75.8 73.4 74.8 75.0 75.4 Durable manufactures 27 Ordnance, pvt. & govt................................ 19,91 3.64 71.7 69.5 69.5 69.1 72.2 71.8 70.8 70.5 70.4 72.0 28 Lumber and products................................. 24 1.64 125.1 123.9 121.1 122.8 129.0 127.5 132.7 132.2 132.0 29 Furniture and fixtures................................ 25 1.37 132.8 134.1 130.6 131.7 134.0 135.7 135.1 137.1 137.6 30 Clay, glass, stone prod............................... 32 2.74 135.8 128.5 133.7 132.7 142.2 142.0 137.3 139.0 142.8 31 Primary metals............................................. 33 6.57 108.0 103.9 101.4 105.4 107.3 102.7 100.0 100.6 106.2 109.8 32 Iron and steel........................................... 331,2 4.21 104.4 100.9 97.7 103.5 103.1 95.6 89.8 91.8 98.0 102.1 33 Fabricated metal prod................................ 34 5.93 123.3 120.9 120.2 121.5 126.7 128.2 125.7 125.9 127.6 129.6 34 Nonelectrical machinery............................ 35 9.15 134.7 131.5 132.9 133.5 137.5 141.2 139.5 139.8 140.3 141.7 35 Electrical machinery.................................... 36 8.05 131.7 126.5 127.8 130.0 135.8 135.6 134.0 137.6 138.5 140.3 36 Transportation equip.................................. 37 9.27 110.6 109.0 111.2 110.6 112.7 118.2 113.5 113.4 120.2 118.1 37 Motor vehicles & pts.............................. 371 4.50 140.7 135.2 140.8 141.3 145.8 156.4 145.5 145.4 160.8 156.9 38 Aerospace & misc. tr. eq....................... 372,9 4.77 82.2 84.3 83.3 81.7 81.6 82.4 83.4 83.3 81.9 81.7 39 Instruments................................................... 38 2.11 148.2 141.8 144.4 145.4 150.3 155.7 153.7 157.0 155.8 157.6 40 Miscellaneous mfrs...................................... 39 1.51 143.5 140.7 142.5 140.7 143.7 146.8 147.8 148.1 146.0 146.6 i 1972 dollars. Note.—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 □ M ay 1977 2.14 HOUSING AND CONSTRUCTION Monthly figures are at seasonally adjusted annual rates. Exceptions noted. 1976 1977 Item 1974 1975 1976 Sept. J Oct. Nov. Dec. Jan. Feb.' Mar. Private residential real estate activity (thousands of units) NEW UNITS 1 Permits authorized......................... 1,074 927 1,281 1,504 1,492 1,590 1,514 1,307 1,529 1,708 2 1-family....................................... 644 669 895 926 998 1,072 1,053 927 1,064 1,205 3 2-or-more-family....................... 431 278 386 578 494 518 461 380 465 503 4 Started............................................. 1,338 1,160 1,540 1,768 1,715 1,706 1,889 ' 1,384 1,815 2,127 5 1-family....................................... 888 892 1,163 1,254 1,269 1,236 1,324 '1,006 1,431 1,525 6 2-or-more-family....................... 450 268 377 514 446 470 565 '378 384 602 7 Under construction, end of period 1,189 1,003 1,157 1,107 1,140 1,168 1,192 ' 1,209 1,231 8 1-family....................................... 516 531 r656 641 662 671 '686 '696 111 9 2-or-more-family....................... 673 472 r501 466 478 497 '507 514 514 10 Completed....................................... 1,692 1,297 r1,362 1,387 1,326 1,399 '7,444 ' 1,411 1,615 11 1-family....................................... 931 866 *•1,026 1,017 989 1,068 '1,078 '1,099 1,210 12 2-or-more-family....................... 760 430 r336 370 337 331 '366 '312 405 13 Mobile homes shipped................. 329 213 250 r248 r263 '247 '248 258 275 265 Merchant builder activity in 1-family units: 14 Number sold.................................. 501 544 r639 714 728 r694 '798 '786 853 15 Number for sale, end of period1. 407 383 433 415 420 '429 433 '433 436 Price (thous. of dollars)2 Median: 16 Units sold............................... 35.9 39.3 44.2 44.7 45.3 '45.8 '46,0 '45,6 47,5 17 Units for sale......................... 36.2 38.9 41.6 41.0 41.0 41.2 '41,6 '41,8 42.0 Average: 18 Units sold............................... 38.9 42.5 48.1 48.2 50.4 50.0 '50,6 '51,9 53,1 52.7 EXISTING UNITS (1-family) 19 Number sold.................................. 2,272 2,452 3,002 3,250 3,230 3,300 3,470 3,190 3,080 3,410 Price of units sold (thous. of dollars):2 20 Median........................................ 32.0 35.3 38.1 38.7 38.5 38.8 39.0 39.6 40.7 41.0 21 Average....................................... 35.8 39.0 42.2 42.7 42.4 42.9 43.3 44.0 45.1 45.5 Value of new constructio n 3 (millionsof dollars) CONSTRUCTION 22 Total put in place.................................. 138,526 132,043 144,821 146,631 148,475 152,819 152,185 r137,087 148,955 157,286 23 Private..................................................... 100,179 93,034 108,424 109,000 114,503 118,752 118,918 107,153 116,503 124,294 24 Residential.......................................... 50,378 46,476 59,948 59,130 65,405 69,181 69,951 63,404 69,142 74,293 25 Nonresidential, total........................ 49,801 46,558 48,476 49,870 49,098 49,571 48,967 43,749 47,361 50,001 Buildings: 26 Industrial.................................... 7,902 8,017 6,910 6,894 6,407 6,461 6,453 6,088 6,398 6,929 27 Commercial................................ 15,945 12,804 12,586 12,786 12,560 12,522 12,859 12,178 12,449 13,564 28 Other............................................ 5,797 5,585 6,252 6,669 6,489 6,677 6,497 5,978 5,892 6,099 29 Public utilities and other............. 20,157 20,152 22,728 23,521 23,642 23,911 23,158 19,505 22,622 23,409 30 Public....................................................... 38,347 39,009 36,397 37,631 33,972 34,067 33,267 '29,934 32,452 32,992 31 Military................................................ 1,188 1,391 1,479 1,352 1,467 1,622 1,567 1,509 1,597 1,444 32 Highway.............................................. 12,069 10,345 9,112 8,856 8,738 7,843 7,508 r5,975 7,497 33 Conservation and development. . . 2,741 3,227 3,659 4,281 2,949 4,077 3,856 '3,446 3,968 34 Other.................................................... 22,349 24,046 22,147 23,142 20,818 20,525 20,336 r19,004 19,390 1 Not at annual rates. Note.—Census Bureau estimates for all series except (a) mobile 2 Not seasonally adjusted. homes, which are private, domestic shipments as reported by the Manu­ 3 Value of new construction data in recent periods may not be strictly factured Housing Institute and seasonally adjusted by the Census Bureau, comparable with data in prior periods due to changes by the Bureau of and (b) sales and prices of existing units, which are published by the the Census in its estimating techniques. For a description of these changes National Association of Realtors. All back and current figures are avail­ see Construction Reports (C-30-76-5), issued by the Bureau in July 1976. able 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. 12 months to— 3 months (at annual rate) to— 1 month to- Index level Item 1976 1977 1976 1977 Mar. 1976 1977 1977 Mar. Mar. j (1967 Juner Sept.r Dec.r Mar. Nov.r Dec. Jan. Feb. Mar. = 100): Consumer prices 1 6.1 6.4 6.1 5.3 4.2 10.0 .3 .4 .8 1.0 .6 178.2 2 Commodities...................................................... 4.7 5.9 6.0 3.9 3.4 10.4 .2 .4 .8 1.2 .5 171.8 3 Food............................................................... 4.3 5.5 6.2 1.6 0.0 14.6 -.3 .1 .9 2.0 .6 188.6 4 Commodities less food............................... 5.0 6.1 5.6 5.5 5.7 7.4 .4 .6 .7 .7 .4 162.6 5 Durable..................................................... 5.8 6.9 6.5 5.0 6.0 10.5 .4 .7 .9 .9 .6 160.8 6 Nondurable.............................................. 4.4 5.5 5.0 6.0 5.4 10.1 .4 .4 .5 1.5 .5 175.9 7 Services............................................................... 8.6 7.2 6.5 7.5 5.1 9.8 .4 .4 .9 .6 .8 190.0 8 Rent................................................................ 5.3 5.7 5.4 5.4 5.3 6.3 .4 .5 r. 8 .3 .5 150.8 9 Services less rent.......................................... 9.0 7.5 6.7 7.7 5.4 10.4 .4 .4 .9 .7 .8 197.1 Other groupings: 10 6.7 6.6 7.0 7.4 5.3 6.9 .5 .3 .4 .6 .6 175.1 11 All items less shelter1................................ 6.2 6.5 6.9 5.6 4.3 9.4 .4 .3 .5 1.1 .6 176.1 12 Homeownership1......................................... 5.9 5.6 4.3 8.0 1.2 9.1 0.0 .1 .9 .7 .6 199.3 Wholesale prices 13 All commodities................................................ 5.5 6.8 6.6 3.5 7.1 10.2 .6 .6 .5 .9 1.1 191.9 14 Farm products, and processed foods and feeds............................................................ 2.9 6.1 13.4 - 12.0 6.6 19.1 .1 2.1 .3 2.0 2.1 190.9 15 Farm products............................................. 9.0 8.5 18.2 -11.9 5.8 26.0 -.6 2.6 1.1 2.2 2.5 202.4 16 Processed foods and feeds......................... -.8 4.6 10.3 -11.8 6.5 15.6 .5 1.8 r-.l 1.8 1.9 183.9 17 Industrial commodities.................................... 6.0 7.0 4.8 8.0 7.6 7.9 .6 .3 .5 .6 .5 191.6 Materials, supplies, and components of which: 18 Crude materials2...................................... 8.9 17.5 16.4 10.6 21.6 21.9 3.6 - 2.2 -1.2 4.0 2.3 279.6 19 Intermediate materials3......................... 5.5 6.7 '3.5 8.3 7.1 8.0 .5 .5 .5 .6 .9 198.6 Finished goods, excluding foods: 20 6.1 6.5 3.6 7.7 5.2 8.5 .4 .3 1.0 .3 .8 169.1 21 Durable................................................. 4.5 4.6 3.1 5.1 3.3 7.0 .1 .1 .7 .5 .4 149.7 22 Nondurable.......................................... 6.9 7.2 3.8 9.1 6.5 9.5 .7 .3 1.1 .2 1.0 182.1 23 Producer.................................................... 6.8 5.9 4.3 4.7 9.5 5.3 .5 .7 .4 .5 .4 180.7 Memo: 24 Consumer foods............................................... 3.5 4.5 13.2 -13.1 8.4 12.7 -.3 2.8 -.1 2.0 1.1 186.6 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. Note: Any revisions are for wholesale prices only. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A52 Domestic Nonfinancial Statistics □ M ay 1977 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates. 1975 1976 1977 Account 1974 1975 1976 Q4 Ql Q2 Q3 Q4 QIp Gross national product 1 1,413.2 1,516.3 1,691.6 1,588.2 1,636.2 1,675.2 1,708.9 1,745.1 1,792.5 By source: 2 Personal consumption expenditures.................... 887.5 973.2 1,079.7 1,012.0 1,043.6 1,064.7 1,088.5 1,122.0 1,156.8 3 Durable goods................................................... 121.6 131.7 156.5 141.8 151.4 155.0 157.6 162.0 173.4 4 Nondurable goods............................................ 376.2 409.1 440.4 421.6 429.1 434.8 441.8 456.0 463.7 5 Services............................................................... 389.6 432.4 482.8 448.6 463.2 474.9 489.1 504.0 519.6 6 Gross private domestic investment...................... 215.0 183.7 239.6 201.4 229.6 239.2 247.0 242.8 260.2 7 Fixed investment............................................... 204.3 198.3 227.7 205.7 214.7 223.2 231.9 241.0 252.7 8 Nonresidential................................................ 149.2 147.1 160.0 148.7 153.4 157.9 163.0 165.6 173.1 9 Structures.................................................... 54.1 52.0 55.3 52.1 53.2 54.9 56.0 57.0 56.3 10 Producers’ durable equipment............... 95.1 95.1 104.7 96.6 100.2 103.0 107.0 108.6 116.8 11 Residential structures.................................. 55.1 51.2 67.7 57.0 61.3 65.3 68.9 75.5 79.7 12 Nonfarm..................................................... 52.7 49.0 65.1 54.2 58.6 62.9 66.3 72.7 76.9 13 Change in business inventories...................... 10.7 -14.6 11.9 -4.3 14.8 16.0 15.1 1.7 7.5 14 Nonfarm......................................................... 12.2 -17.6 11.9 -9.5 12.7 17.3 15.6 2.2 7.5 15 Net exports of goods and services....................... 7.5 20.5 6.6 21.0 8.4 9.3 4.7 4.2 -4.9 16 Exports............................................................... 144.4 148.1 162.7 153.7 154.1 160.3 167.7 168.5 170.5 17 Imports............................................................... 136.9 127.6 156.0 132.7 145.7 151.0 163.0 164.3 175.4 18 Govt, purchases of goods and services............... 303.3 339.0 365.6 353.8 354.7 362.0 369.6 376.2 380.4 19 Federal................................................................ 111.6 124.4 133.4 130.4 129.2 131.2 134.5 138.9 139.5 20 State and local.................................................. 191.6 214.5 232.2 223.4 225.5 230.9 235.0 237.4 240.9 By major type of product: 21 Final sales, total.................................................... 1,402.5 1,531.0 1,679.7 1,592.5 1,621.4 1,659.2 1,694.7 1,743.4 1,785.0 22 Goods................................................................... 639.7 681.7 760.2 719.7 742.3 758.4 766.1 774.3 799.0 23 Durable goods............................................... 247.2 254.4 300.5 270.0 282.7 301.2 308.2 309.8 330.9 24 Nondurable.................................................... 392.4 427.3 459.8 449.7 459.6 457.1 457.9 464.5 468.2 25 Services............................................................... 626.6 692.5 772.0 719.5 742.6 759.6 781.5 804.4 824.7 26 Structures........................................................... 146.9 142.1 159.3 149.1 151.3 157.3 162.2 166.5 168.7 27 Change in business inventories.......................... 10.7 -14.6 11.9 -4.3 14.8 16.0 15.1 1.7 7.5 28 Durable goods................................................... 7.1 -12.1 2.7 -10.6 -3.6 5.4 6.8 2.0 7.2 29 Nondurable goods............................................ 3.6 -2.6 9.2 6.3 18.5 10.6 8.3 -.3 .3 Memo: 30 Total GNP in 1972 dollars.................................... 1,214.0 1,191.7 1,264.7 1,219.2 1,246.3 1,260.0 1,272.2 1,280.4 1,296.8 National income 31 Total............................................................................. 1,135.7 1,207.6 1,348.4 1,264.6 1,304.7 1,337.4 1,362.5 rl,389.3 875.8 928.8 1,028.4 963.1 994.4 1,017.2 1,037.5 1,064.5 1,096.6 33 Wages and salaries................................................ 764.5 806.7 890.4 836.4 861.5 881.1 897.8 921.0 946.2 34 Government and Government enterprises.. 160.4 175.8 190.7 182.2 185.4 188.7 191.7 197.0 200.0 35 Other................................................................... 604.1 630.8 699.7 654.1 676.1 692.4 706.1 723.9 746.1 36 Supplement to wages and salaries....................... 111.3 122.1 138.0 126.7 132.9 136.2 139.6 143.5 150.4 37 Employer contributions for social insurance.................................................... 55.8 59.7 67.9 61.6 65.9 67.1 68.6 70.2 14.1 38 Other labor income.......................................... 55.5 62.5 70.1 65.2 67.1 69.0 71.1 73.3 75.7 86.9 90.2 96.7 97.2 93.2 100.3 96.1 97.1 103.3 40 Business and professional1.................................. 61.1 65.3 73.8 69.0 71.4 72.8 14.4 76.8 79.3 41 Farm1...................................................................... 25.8 24.9 22.8 28.3 21.9 27.5 21.7 20.3 24.0 42 Rental income of persons2...................................... 21.0 22.4 23.5 22.9 23.3 23.1 23.4 24.3 25.1 43 Cornorate nrofits 1..................................................... 84.8 91.6 117.8 105.6 115.1 116.4 122.0 r117.8 44 Profits before tax3................................................ 127.6 114.5 147.9 131.3 141.1 146.2 150.2 r154.2 45 Inventory valuation adjustment......................... -39.8 -11.4 -14.6 -12.3 -11.5 -14.4 -12.6 -20.0 -23.2 46 Capital consumption adjustment....................... -3.0 -11.5 -15.5 -13.5 -14.5 -15.4 -15.7 -16.4 -17.0 47 Net interest................................................................. 67.1 74.6 82.0 75.8 78.6 80.3 83.5 85.6 88.6 1 With inventory valuation and capital consumption adjustments. 3 For after-tax profits, dividends, etc., see Table 1.50. 2 With capital consumption adjustments. Source.—Survey of Current Business (U.S. Dept, of Commerce). 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 1977 1974 1975 1976 Account Q4 Ql Q2 Q3 Q4 Ql*> Personal income and saving 1 Total personal income............................................... 1,153.3 1,249 7 1,375.3 1,299.7 1,331.3 1,362.0 1,386.0 1,421.7 1,462.8 2 Wage and salary disbursements............................... 765.0 806.7 890.4 836.4 c861.5 881.1 897.8 921.0 946.2 3 Commodity-producing industries...................... 273.9 275.3 304.8 285.8 295.3 302.9 307.0 314.0 323.0 4 Manufacturing................................................... 211.4 211.7 237.0 220.3 229.6 235.6 238.9 243.9 252.2 5 Distributive industries.......................................... 184.4 195.6 214.9 202.3 208.3 212.8 216.5 221.9 229.1 6 Service industries.................................................. 145.9 159.9 180.0 166.1 172.4 176.7 182.7 188.1 194.1 7 Government and government enterprises........ 160.9 175.8 190.7 182.2 185.4 188.7 191.7 197.0 200.0 8 Other labor income.................................................. 55.5 62.5 70.1 65.2 67.1 69.0 71.1 73.3 75.7 9 Proprietors' income1.................................................. 86.9 90.2 96.7 97.2 93.2 100.3 96.1 97.1 103.3 10 Business and professional1.................................. 61.1 65.3 73.8 69.0 71.4 72.8 74.4 76.8 79.3 11 Farm1...................................................................... 25.8 24.9 22.8 28.3 21.9 27.5 21.7 20.3 24.0 12 Rental income of persons2...................................... 21.0 22.4 23.5 22.9 23.3 23.1 23.4 24.3 25.1 13 Dividends.................................................................... 30.8 32.1 35.1 32.2 33.1 34.4 35.4 37.7 37.6 14 Personal interest income.......................................... 101.4 110.7 123.0 114.4 118.0 120.7 125.0 128.4 131.5 15 Transfer payments..................................................... 140.3 175.2 191.3 182.5 188.6 187.6 192.4 196.6 203.0 16 Old-age survivors, disability, and health insurance benefits.......................................... 70.1 81.4 93.0 86.3 88.1 89.5 95.8 98.5 100.1 17 Less: Personal contributions for social insurance......................................................... 47.6 50.0 54.9 51.0 53.4 54.3 55.2 56.6 59.7 18 Equals : Personal income....................................... 1,153.3 1,249.7 1,375.3 1,299.7 1,331.3 1,362.0 1,386.0 1,421.7 1,462.8 19 Less : Personal tax and nontax payments.... 170.4 168.8 193.6 c179.8 183.8 189.5 195.8 205.3 214.3 20 Equals: Disposable personal income.................. 982.9 1,080.9 1,181.7 1,119.9 1,147.6 1,172.5 1,190.2 1,216.5 1,245.5 21 Less : Personal outlays........................................ 910.7 996.9 1,105.2 1,036.2 1,068.0 1,089.6 1,114.3 1,148.6 1,183.8 22 Equals: Personal saving........................................ 72.2 84.0 76.5 83.7 79.5 82.9 75.8 67.8 61.8 Memo: Per capita (1972 dollars): 23 Gross national product........................................ 3,968.0 4,007.0 4,140.0 4,049.0 4,103.0 4,143.0 4,142.0 4,168.0 4,195.0 24 Personal consumption expenditures................. 887.5 973.2 1,079.7 1,012.0 1,043.6 1,064.7 1,088.5 1,122.0 1,156.8 25 Disposable personal income............................... 840.8 855.5 890.5 867.5 880.4 890.5 892.0 899.6 906.8 26 Saving rate (per cent)............................................... 7.3 7.8 6.5 7.5 6.9 7.1 6.4 5.6 5.0 Gross saving 27 Gross private saving.................................................. 211.6 255.6 274.6 269.4 273.8 279.1 278.9 266.7 28 Personal saving...................................................... 72.2 84.0 76.5 83.7 79.5 82.9 75.8 67.8 61.8 29 Undistributed corporate profits1....................... 1.7 10.3 18.3 16.2 20.6 18.5 21.5 12.7 30 Corporate inventory valuation adjustment.... -39.8 -11.4 -14.6 -12.3 -11.5 -14.4 -12.6 -20.0 -23.2 Capital consumption allowances: 31 Corporate........................................................... 84.6 100.9 112.8 106.4 108.8 111.6 113.9 116.9 119.5 32 Noncorporate..................................................... 53.1 60.4 67.0 63.2 64.8 66.1 67.7 69.3 71.7 33 Wage accruals less disbursements..................... 34 Government surplus, or deficit (—), national income and product accounts........................... -4.2 -64.4 -44.7 -61.5 -51.6 -44.9 -44.7 -37.4 35 Federal.................................................................... -11.5 -71.2 -58.6 -69.4 -63.8 -54.1 -57.4 -59.3 36 State and local....................................................... 7.3 6.9 14.0 7.9 12.2 9.2 12.7 21.9 37 Capital grants received by the United States, net........................................................................ -2.0 38 Investment................................................................... 211.9 195.6 237.7 214.0 229.4 240.0 242.9 238.4 246.4 39 Gross private domestic.....................r................ 215.0 183.7 239.6 201.4 229.6 239.2 247.0 242.8 260.2 40 Net foreign............................................................. -3.0 11.9 -2.0 12.6 -.2 .8 -4.1 -4.3 -13.8 41 Statistical discrepancy.............................................. 6.8 4.4 7.7 6.1 7.2 5.8 8.7 9.2 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 □ M ay 1977 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars, quarterly data are seasonally adjusted except as noted.1 1975 1976 Item credits or debits 1974 1975 1976 Q4 Ql Q2 Q3 Q4 1 Merchandise exports..................................................................... 98,310 107,088 114,692 27,657 26,997 28,378 29,600 29,717 2 Merchandise imports.................................................................... 103,679 98,058 123,916 25,437 28,324 29,914 32,387 33,291 3 Merchandise trade balance2................................................... -5,369 9,030 -9,224 2,220 -1,327 -1,536 -2,787 -3,574 4 Military transactions, net............................................................. -2,083 -883 391 12 -15 -155 339 223 5 Investment income, net................................................................ 10,227 6,007 10,538 1,670 2,286 2,468 2,784 3,000 6 Other service transactions, net................................................... 812 2,163 2,696 455 475 781 860 578 3,586 16,316 4,401 4,357 1,419 1,558 1,196 227 8 Remittances, pensions, and other transfers......................... -1,710 -1,727 -1,866 -433 -483 -452 -446 -487 9 U.S. Govt, grants (excluding military)................................. -5,475 -2,893 -3,139 -818 -635 -468 -1,479 -557 -3,598 11,697 -604 3,106 301 638 -729 -817 11 Not seasonally adjusted............................................................. 4,305 1,449 742 -3,677 883 12 Change in U.S. Govt, assets, other than official reserve assets, net (increase, —)...................................................... 365 -3,463 -4,295 -952 -684 -1,009 -1,450 -1,153 13 Change in U.S. official reserve assets (increase, —)................ - 1,434 -607 -2,530 89 -773 -1,578 -407 228 14 Gold............................................................................................. 15 SDR’s.......................................................................................... -172 -66 -78 -21 -45 14 -18 -29 16 Reserve position in IMF......................................................... -1,265 -466 -2,212 -57 -237 -798 -716 -461 17 Foreign currencies..................................................................... 3 -75 -240 167 -491 -794 327 718 18 Change in U.S. private assets abroad (increase, — )................ -32,323 -27,523 -36,195 -10,375 -8,550 -7,288 -6,824 -13,534 19 Bank-reported claims................................................................. -19,494 -13,487 -20,742 -5,348 -3,582 -4,767 -3,355 -9,038 20 Long-term............................................................................... -1,183 -2,373 -2,098 -943 -250 -385 -993 -470 21 Short-term.............................................................................. -18,311 -11,114 -18,644 -4,405 -3,332 -4,382 -2,362 -8,568 22 Nonbank-reported claims.......................................................... -3,221 -1,522 -1,772 -972 -751 —962 721 -780 23 Long-term............................................................................... -47 4 -441 -14 -379 -187 146 53 -26 24 Short-term.............................................................................. -2,747 -1,081 -1,758 -593 -564 -1,108 668 -754 25 U.S. purchase of foreign securities, net............................... -1,854 -6,206 -8,682 -2,361 -2,460 -1,357 -2,743 -2,123 26 U.S. direct investments abroad, net...................................... -7,753 -6,307 -5,000 -1,694 -1,757 -202 -1,447 -1,593 27 Change in foreign official assets in the United States (in­ crease, +)............................................................................... 10,981 6,899 18,107 2,771 3,942 4,105 2,999 7,061 28 U.S. Treasury securities........................................................... 3,282 4,338 9,301 1,069 1,998 2,166 1,261 3,876 29 Other U.S. Govt, obligations................................................. 902 891 566 307 68 316 66 116 30 Other U.S. Govt, liabilities4.............................................. 724 1,732 5,013 499 1,482 797 1,746 988 31 Other U.S. liabilities reported by U.S. banks..................... 5,818 -2,158 1,012 134 -275 135 -598 1,750 32 Other foreign official assets5.................................................. 254 2,095 2,215 762 669 691 524 331 33 Change in foreign private assets in the United States (in 21,452 8,427 15,022 3,103 1,454 3,225 5,248 5,095 34 U.S. bank-reported liabilities................................................... 16,017 647 10,974 691 675 3,518 1,766 5,015 35 Long-term............................................................................... 9 -300 172 146 -91 -25 67 221 36 Short-term.............................................................................. 16,008 947 10,802 545 766 3,543 1,699 4,794 1,615 171 -588 -68 24 -248 -324 -40 -212 345 -1,017 10 -332 -188 -285 -212 1,827 -174 429 -78 356 -60 -39 172 40 Foreign private purchases of U.S. Treasury securities, net. 697 2,667 2,825 213 453 -598 3,026 -56 41 Foreign purchases of other U.S. securities, net................. 378 2,505 1,250 1,038 1,030 131 68 21 42 Foreign direct investments in the United States, net........ 2,745 2,437 561 1,229 -728 422 712 155 43 Allocations of SDR’s................................................................... 44 Discrepancy..................................................................................... 4,557 4,570 10,495 2,258 4,310 1,907 1,163 3,120 1,275 958 73 -2,800 1,773 46 Statistical discrepancy in recorded data before seasonal adjustment.......................................................................... 4,557 4,570 10,495 983 3,352 1,834 3,963 1,347 Memo: Changes in official assets: 47 U.S. official reserve assets (increase, —)............................... -1,434 -607 -2,530 89 -773 -1,578 -407 228 48 Foreign official assets in the U.S. (increase,+).................. 10,257 5,166 13,094 2,272 2,460 3,308 1,253 6,073 49 Changes in OPEC official assets in the U.S. (part of line 27 above)...................................................................................... 10,841 7,108 9,517 1,996 3,491 3,339 1,687 1,000 50 Transfers under military grant programs (excluded from lines 1, 4, and 9 above)........................................................ 1,817 2,232 400 177 50 99 156 95 1 Seasonal factors are no longer calculated for lines 13 through 50. excludes certain military sales to Israel from exports and excludes U.S. 2 Data are on an international accounts (IA) basis. Differs from the Govt, interest payments from imports. Census basis primarily because the IA basis includes imports into the 4 Primarily associated with military sales contracts and other transac­ U.S. Virgin Islands, and it excludes military exports, which are part of tions arranged with or through foreign official agencies. Line 4. 5 Consists of investments in U.S. corporate stocks and in debt securi­ 3 Differs from the definition of “net exports of goods and services” in ties of private corporations and state and local governments. the national income and product (GNP) account. The GNP definition Note.—Data are from Bureau of Economic Analysis, Survey of Cur­ rent Business (U.S. Department of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Trade and Reserve A ssets A55 3.11 U.S. FOREIGN TRADE Millions of dollars, monthly data are seasonally adjusted. 1976 1977 Item 1974 1975 1976 Sept. Oct. Nov. Feb. Mar. 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments............................................ 97,908 107,130 114,807 9,788 9,699 9,589 10,410 9,599 9,808 10,072 2 GENERAL IMPORTS including merchandise for immediate con­ sumption plus entries into bonded warehouses.......................................... 100,252 96,115 120,677 10,651 10,555 10,623 11,020 11,269 11,674 12,459 3 Trade balance......................................... -2,344 +11,014 -5,870 -863 -857 -1,034 -610 -1,670 -1,866 -2,387 Note.—Bureau of Census data reported on a free-alongside-ship exports (which are combined with other military transactions and are (f.a.s.) value basis. Before 1974 imports were reported on a customs reported separately in the “service account”). On the import side, the import value basis. For calendar year 1974 the f.a.s. import value was largest single adjustment is the addition of imports into the Virgin Islands $100.3 billion, about 0.7 per cent less than the corresponding customs (largely oil for a refinery on St. Croix), which are not included in Census import value. The international-accounts-basis data shown in Table 3.10 statistics. adjust the Census basis data for reasons of coverage and timing. On the export side, the largest adjustments are: (a) the addition of exports to Source.—U.S. Dept, of Commerce, Bureau of the Census, Summary Canada not covered in Census statistics, and (b) the exclusion of military of U.S. Export and Import Merchandise Trade (FT 900). 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period 1976 1977 Type 1973 1974 1975 Oct. Nov. Dec. Jan. Feb. Mar. Apr. 1 Total......................................................... 314,378 15,883 16,226 19,013 19,416 18,747 19,087 19,122 19,120 418,868 2 Gold stock, including Exchange Stabilization Fund1.......................... 311,652 11,652 11,599 11,598 11,598 11,598 11,658 11,658 11,658 11,658 3 Special Drawing Rights2..................... 3 2,166 2,374 2,335 2,352 2,365 2,395 2,375 2,383 2,389 4 2,384 4 Reserve position in International Monetary Fund.................................. 3 552 1,852 2,212 3,997 4,307 4,434 4,682 4,819 4,812 44,720 5 Convertible foreign currencies........... 8 5 80 1,066 1,146 320 372 262 261 106 1 Gold held under earmark at F.R. Banks for foreign and international 4 Beginning July 1974, the IMF adopted a technique for valuing the accounts is not included in the gold stock of the United States; see Table SDR based on a weighted average of exchange rates for the currencies 3.24. 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 April amounted to $19,020; SDR holdings, $2,475, and reserve 3 Change in par value of U.S. dollar on Oct. 18, 1973 increased total position in IMF, $4,781. 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 □ M ay 1977 3.13 SELECTED U.S. LIABILITIES TO FOREIGNERS Millions of dollars, end of period 1974 1976 1977 Holder, and type of liability 1973 1975 Dec. 9 Oct. Nov. Dec. Jan. Feb.? Mar.p 1 Total......................................................... 92,490 119,240 119,164 126,552 143,728 144,643 151,329 147,913 149,093 151,583 2 Foreign countries.................................... 90,487 115,918 115,842 120,929 136,093 136,411 142,846 139,994 141,108 143,455 3 Official institutions1............................... 66,861 76,801 76,823 80,695 86,827 87,745 91,850 93,046 93,859 96,408 4 Short-term, reported by banks in the United States.2................... 43,923 53,057 53,079 49,513 49,017 49,273 53,478 54,515 54,796 55,913 U.S. Treasury bonds and notes: 5 Marketable3................................... 5,701 5,059 5,059 6,671 11,027 11,367 11,788 12,017 12,725 13,528 6 Nonmarketable4........................... 15,564 16,339 16,339 19,976 20,876 21,131 20,648 20,622 20,496 21,106 7 Other readily marketable liabilities5............................... 1,673 2,346 2,346 4,535 5,907 5,974 5,936 5,892 5,842 5,861 Commercial banks abroad: 8 Short-term reported by banks in the United States2,6................. 17,694 30,314 30,106 29,516 36,940 35,384 37,429 33,510 33,173 32,941 9 Other foreigners...................................... 5,932 8,803 8,913 10,718 12,326 13,282 13,567 13,438 14,076 14,106 10 Short-term, reported by banks in the United States2.................... 5,502 8,305 8,415 10,017 11,399 12,312 12,591 12,441 13,056 12,929 11 Marketable U.S. Treasury bonds and notes3,7............................... 430 498 498 701 927 970 976 997 1,020 1,177 12 Nonmonetary international and regional organization8................... 2,003 3,322 3,322 5,623 7,635 8,232 8,483 7,919 7,985 8,128 13 Short-term, reported by banks in the United States2........... 1,955 3,171 3,171 5,292 5,102 5,506 5,450 4,625 3,918 4,309 14 Marketable U.S. Treasury bonds and notes3................. 48 151 151 331 2,533 2,726 3,033 3,294 4,067 3,819 1 Includes Bank for International Settlements. 9 Data in the two columns shown for this date differ because of changes 2 Includes Treasury bills as shown in Table 3.15. in reporting coverage. Figures in the first column are comparable in cover­ 3 Derived by applying reported transactions to benchmark data. age with those for the preceding date; figures in the second column are 4 Excludes notes issued to foreign official nonreserve agencies. comparable with those shown for the following date. 5 Includes long-term liabilities reported by banks in the United States and debt securities of U.S. Federally sponsored agencies and U.S. cor­ Note.—Based on Treasury Dept, data and on data reported to the porations. Treasury Dept, by banks (including Federal Reserve banks) and brokers 6 Includes short-term liabilities payable in foreign currencies to com­ in the United States. Data exclude the holdings of dollars of the Inter­ mercial banks abroad and to other foreigners. national Monetary Fund derived from payments of the U.S. subscription, 7 Includes marketable U.S. Treasury bonds and notes held by com­ and from the exchange transactions and other operations of the IMF. mercial banks abroad and other foreigners. Data also exclude U.S. Treasury letters of credit and nonnegotiable, non- 8 Principally the International Bank for Reconstruction and Develop­ interest-bearing special U.S. notes held by nonmonetary international ment and the Inter-American and Asian Development Banks. and regional organizations. 3.14 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1974 1976 1977 Area 1973 1975 Dec.3 Oct. Nov. Dec. Jan. Feb .p Mar.p 1 Total......................................................... 66,861 76,801 76,823 80,695 86,827 87,745 91,850 93,046 93,859 96,408 2 Western Europe 1............................. 45,764 44,328 44,328 45,685 41,933 44,075 45,855 45,927 46,108 47,895 3 Canada................................................ 3,853 3,662 3,662 3,132 3,389 2,406 3,406 3,197 2,844 2,684 4 Latin American republics............... 2,544 4,419 4,419 4,450 4,086 4,087 4,853 4,546 4,530 4,747 5 Asia...................................................... 10,887 18,604 18,626 22,550 33,438 33,906 34,112 35,562 36,458 37,427 6 Africa................................................... 788 3,161 3,161 2,984 2,415 1,925 1,843 1,757 1,771 1,681 7 Other countries 2............................... 3,025 2,627 2,627 1,894 1,566 1,346 1,781 2,057 2,148 1,974 1 Includes Bank for International Settlements. 3 See Note 9 to Table 3.13. 2 Includes countries in Oceania and Eastern Europe, and Western European dependencies in Latin America. Note.—Data represent breakdown by area of line 3, Table 3.13. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bank-reported D ata A57 3.15 SHORT-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States By Holder and by Type of Liability Millions of dollars, end of period 1974 1976 1977 Holder, and type of liability 1973 1975 Dec.8 Oct. Nov. Dec. Jan. Feb^ Mar.p 1 All foreigners, excluding the International Monetary Fund................................................... 69,074 94,847 94,771 94,338 102,458 102,474 108,949 105,091 104,943 106,092 2 Payable in dollars................................................... 68,477 94,081 94,004 93,780 101,692 101,693 108,225 104,359 104,128 105,231 Deposits: 3 Demand........................................................... 11,310 14,068 14,051 13,564 14,658 15,811 16,803 15,314 16,098 15,175 4 Time1............................................................... 6,882 10,106 9,932 10,348 10,546 10,757 11,546 11,395 11,205 11,203 5 U.S. Treasury bills and certificates2.............. 31,886 35,662 35,662 37,414 38,934 38,643 40,744 41,275 42,669 43,553 6 Other short-term liabilities3............................ 18,399 34,246 34,359 32,466 37,552 36,484 39,133 36,374 34,157 35,299 7 Payable in foreign currencies................................ 597 766 766 558 766 781 724 732 815 861 8 Nonmonetary international and regional organizations4..................................................... 1,955 3,171 3,171 5,293 5,102 5,506 5,450 4,625 3,918 4,309 9 Payable in dollars................................................... 1,955 3,171 3,171 5,284 5,098 5,502 5,445 4,621 3,912 4,306 Deposits: 10 Demand........................................................... 101 139 139 139 256 287 290 166 216 229 11 Time1............................................................... 83 111 111 148 164 199 208 230 237 236 12 U.S. Treasury bills and certificates................ 296 497 497 2,554 3,196 3,604 2,701 2,890 2,779 2,743 13 Other short-term liabilities5............................ 1,474 2,424 2,424 2,443 1,482 1,412 2,247 1,335 680 1,098 14 Payable in foreign currencies................................ 8 4 4 5 4 6 3 15 Official institutions, banks, and other foreigners.. 67,119 91,676 91,600 89,046 97,356 96,969 103,499 100,466 101,025 101,783 16 Payable in dollars................................................... 66,522 90,910 90,834 88,497 96,594 96,193 102,780 99,738 100,216 100,925 Deposits: 17 Demand........................................................... 11,209 13,928 13,912 13,426 14,402 15,524 16,513 15,148 15,882 14,947 18 Time1............................................................... 6,799 9,995 9,821 10,200 10,383 10,558 11,338 11,166 10,968 10,967 19 U.S. Treasury bills and certificates2.............. 31,590 35,165 35,165 34,860 35,736 35,039 38,042 38,386 39,889 40,811 20 Other short-term liabilities3............................ 16,925 31,822 31,935 30,023 36,070 35,072 36,886 35,039 33,476 34,201 21 Payable in foreign currencies................................ 597 766 766 549 762 776 719 728 809 858 22 Official institutions6................................................... 43,923 53,057 53,079 49,513 49,017 49,273 53,478 54,515 54,796 55,913 23 Payable in dollars................................................... 43,795 52,930 52,952 49,513 49,017 49,273 53,478 54,515 54,796 55,913 Deposits: 24 Demand........................................................... 2,125 2,951 2,951 2,644 2,706 2,685 3,394 2,931 2,404 2,606 25 Time1............................................................... 3,911 4,257 4,167 3,423 2,127 2,149 2,335 2,456 2,376 2,273 26 U.S. Treasury bills and certificates 2.............. 31,511 34,656 34,656 34,182 35,241 34,656 37,675 38,081 39,559 40,454 27 Other short-term liabilities5........................... 6,248 11,066 11,178 9,264 8,943 9,783 10,075 11,047 10,457 10,580 28 Pavahle in foreign mrrptirips____ 127 127 127 29 Banks and other foreigners........................................ 23,196 38,619 38,520 39,533 48,339 47,696 50,021 45,951 46,229 45,870 30 Payable in dollars................................................... 22,727 37,980 37,881 38,984 47,577 46,920 49,302 45,223 45,420 45,012 31 Banks7.................................................................. 17,224 29,676 29,467 28,966 36,178 34,608 36,710 32,788 32,364 32,083 Deposits : 32 Demand....................................................... 6,941 8,248 8,231 7,534 8,361 8,897 9,104 8,475 9,387 8,477 33 Time1........................................................... 529 1,942 1,910 1,942 2,291 1,949 2,479 2,074 1,779 1,777 34 U.S. Treasury bills and certificates............ 11 232 232 335 223 174 169 122 102 108 35 Other short-term liabilities3........................ 9,743 19,254 19,094 19,155 25,303 23,589 24,957 22,116 21,096 21,721 36 Other foreigners................................................. 5,502 8,304 8,414 10,017 11,399 12,312 12,592 12,436 13,056 12,929 Deposits: 37 Demand....................................................... 2,143 2,729 2,730 3,248 3,335 3,943 4,015 3,741 4,091 3,864 38 Time1........................................................... 2,359 3,796 3,744 4,823 5,965 6,461 6,524 6,636 6,813 6,917 39 U.S. Treasury bills and certificates............ 68 277 277 342 274 209 198 183 229 248 40 Other short-term liabilities5........................ 933 1,502 1,664 1,605 1,824 1,700 1,854 1,876 1,924 1,900 41 Payable in foreign currencies................................ 469 639 639 549 762 776 719 728 809 858 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 □ M ay 1977 3.16 SHORT-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States By Country Millions of dollars, end of period 1974 1976 1977 Area and country 1973 1975 Dec. 7 Oct. Nov. Dec. Jan. Feb .p Mar.p 1 69,074 94,847 9 4,111 94,338 102,458 102,475 108,949 105,091 104,943 106,092 2 Foreign countries......................................................... 67,119 91,676 91,600 89,046 97,356 96,969 103,499 100,466 101,025 101,783 3 40,742 48,667 48,813 43,988 39,967 42,480 46,925 43,765 43,584 44,327 4 161 607 607 754 334 332 348 373 401 498 5 1,483 2,506 2,506 2,898 1,879 2,085 2,268 2,376 2,411 2,568 6 Denmark.............................................................. 659 369 369 332 372 416 363 419 419 569 7 165 266 266 391 407 378 419 389 367 315 8 France.................................................................. 3,483 4,287 4,287 7,733 4,409 4,642 4,875 3,701 4,590 4,807 9 13,227 9,420 9,429 4,357 6,532 5,418 5,965 5,304 5,495 4,681 10 Greece................................................................... 389 248 248 284 405 378 403 421 346 296 11 1,404 2,617 2,577 1,072 1,583 2,884 3,206 2,858 2,703 2,401 12 2,886 3,234 3,234 3,411 2,534 2,694 3,007 2,832 2,817 3,181 13 Norway................................................................ 965 1,040 1,040 996 690 740 785 566 793 746 14 534 310 310 195 111 206 239 172 228 209 15 305 382 382 426 506 478 565 492 546 555 16 Sweden................................................................. 1,885 1,138 1,138 2,286 1,295 1,420 1,693 1,613 1,593 1,717 17 3,377 9,986 10,139 8,514 8,331 8,846 9,453 9,571 9,619 8,931 18 98 152 152 118 74 88 166 85 82 88 19 United Kingdom................................................ 6,148 7,559 7,584 6,886 7,953 8,401 10,001 8,996 8,711 10,338 20 Yugoslavia........................................................... 86 183 183 126 131 147 188 113 121 96 21 3,352 4,073 4,073 2,970 2,089 2,639 2,672 2,263 2,136 2,101 22 U.S.S.R................................................................. 22 82 82 40 80 84 51 47 45 50 23 Other Eastern Europe...................................... 110 206 206 200 184 203 255 172 162 178 24 Canada..................................................................... 3,627 3,517 3,520 3,076 4,033 3,944 4,784 4,519 4,900 4,401 25 Latin America......................................................... 7,664 12,038 11,754 14,942 19,065 17,684 19,010 17,847 18,529 19,000 26 Argentina............................................................. 924 886 886 1,147 1,374 1,293 1,538 1,648 1,820 1,889 27 Bahamas............................................................... 852 1,448 1,054 1,827 4,817 2,654 2,789 1,979 2,439 2,200 28 Brazil.................................................................... 860 1,034 1,034 1,227 1,323 1,168 1,432 1,292 1,272 1,108 29 158 276 276 317 298 315 335 325 302 403 30 Colombia............................................................. 247 305 305 417 804 922 1,017 1,090 1,152 1,200 31 Cuba...................................................................... 7 7 7 6 6 6 6 6 6 6 32 Mexico................................................................. 1,296 1,770 1,770 2,066 2,475 2,860 2,848 2,710 2,782 2,750 33 Panama................................................................. 282 488 5ld 1,099 866 1,188 1,140 909 1,002 1,001 34 Peru....................................................................... 135 272 272 244 247 243 257 244 228 246 35 Uruguay............................................................... 120 147 165 172 233 238 245 250 239 241 36 1,468 3,413 3,413 3,289 2,644 3,009 3,060 2,986 2,909 2,833 37 Other Latin American republics..................... 884 1,316 1,316 1,494 1,676 1,740 2,064 2,033 2,225 2,427 Netherlands Antilles2........................................ 71 158 31858 129 160 157 140 151 157 162 39 Other Latin America........................................ 359 519 589 1,507 2,142 1,890 2,139 2,223 1,995 2,533 40 10,839 21,073 21,130 21,539 29,745 28,982 28,461 29, 789 29,258 29,539 41 China, People’s Republic of (Mainland).... 38 50 50 123 48 59 47 47 47 52 42 China, Republic of (Taiwan).......................... 757 818 818 1,025 1,182 1,092 985 1,058 1,158 1,052 Hong Kong......................................................... 372 530 45330 623 887 859 892 941 1,039 1,018 44 India..................................................................... 85 261 261 126 1,048 910 648 510 559 538 45 Indonesia............................................................. 133 1,221 1,221 369 1,154 314 340 695 546 480 46 Israel..................................................................... 327 386 389 386 310 325 385 430 547 496 47 Japan.................................................................... 6,967 10,897 10,931 10,218 14,663 14,736 14,380 14,481 13,358 13,269 48 Korea.................................................................... 195 384 384 390 366 324 437 448 483 381 49 Philippines........................................................... 515 747 747 698 582 606 627 602 554 623 50 Thailand............................................................... 247 333 333 252 223 244 275 301 313 312 51 Middle East oil-exporting countries3............ 4,633 4,623 6,461 7,741 8,124 8,073 9,029 9,276 9,968 52 Other4................................................................... 1,202 813 844 867 1,539 1,388 1,373 1,245 1,378 1,350 53 Africa...................................................................... 1,056 3,551 3,551 3,373 2,782 2,281 2,300 2,207 2,406 2,285 54 Egypt.................................................................... 35 103 103 343 213 171 333 209 244 250 55 Morocco........................................................ 11 38 38 68 85 72 88 97 105 94 56 South Africa....................................................... 114 130 130 169 183 132 143 211 155 136 57 Zaire..................................................................... 87 84 84 63 45 64 35 48 41 39 58 Oil-exporting countries 5................................... 2,814 2,814 2,239 1,732 1,321 1,116 1,033 1,125 965 59 Other4.................................................................. 808 383 383 491 524 521 585 609 735 802 60 Other countries....................................................... 3,190 2,831 2,831 2,128 1,763 1,598 2,019 2,339 2,348 2,231 61 Australia.............................................................. 3,131 2,742 2,142 2,014 1,645 1,486 1,911 2,224 2,231 2,101 62 All other............................................................... 59 89 89 114 119 112 108 166 118 130 63 Nonmonetary international and regional organizations............................................................ 1,955 3,171 3,171 5,293 5,102 5,506 5,450 4,625 3,918 4,309 64 International........................................................... 1,627 2,900 2,900 5,064 4,717 5,109 5,091 4,275 3,599 3,991 65 Latin American regional...................................... 272 202 202 187 182 160 136 160 133 141 66 Other regional6....................................................... 57 69 69 42 203 237 223 190 186 111 For notes see bottom of p. A59. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bank-reported D ata A59 3.17 SHORT-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States Supplemental “Other” Countries 1 Millions of dollars, end of period 1974 1975 1976 1974 1975 1976 Area and country Area and country Dec. Apr. Dec. Apr. Dec. Dec. Apr. Dec. Apr. Dec. Other Western Europe: Other Asia: Cyprus.......................... 25 Afghanistan................... 18 19 41 54 57 Iceland......................... 26 Bangladesh.................... 21 50 54 41 Ireland, Republic of.. 27 Burma............................. 65 49 31 34 13 28 Cambodia...................... 4 4 4 3 4 Other Eastern Europe: 29 Jordan............................ 22 30 39 20 37 Bulgaria........................................ 36 13 13 30 Laos................................ 3 5 2 2 1 Czechoslovakia........................... 34 11 10 31 Lebanon......................... 126 180 117 132 140 German Democratic Republic. 36 18 3 32 Malaysia......................... 63 92 77 105 396 Hungary........................................ 14 11 10 33 Nepal.............................. 25 22 28 34 33 Poland.......................................... 55 42 65 34 Pakistan......................... 91 118 74 89 189 Rumania...................................... 25 14 28 35 Singapore....................... 245 215 256 34 280 36 Sri Lanka (Ceylon).... 14 13 13 9 23 Other Latin American republics: 37 Vietnam......................... 126 70 62 33 66 Bolivia....................................... 96 93 110 104 133 Costa Rica............................... 118 120 124 69 141 Other Africa: Dominican Republic............. 128 214 169 149 275 38 Ethiopia (incl. Eritrea), 95 76 60 70 41 Ecuador.................................... 122 157 120 150 319 39 Ghana............................. 18 13 23 45 27 El Salvador.............................. 129 144 171 128 178 40 Ivory Coast................... 7 11 62 76 10 Guatemala................................ 219 255 260 177 397 41 Kenya............................. 31 32 19 37 46 Haiti.......................................... 35 34 38 33 47 42 Liberia............................ 39 33 53 63 77 Honduras.................................. 88 92 99 69 137 43 Southern Rhodesia.... 2 3 1 1 1 Jamaica..................................... 69 62 41 49 35 44 Sudan.............................. 4 14 12 17 22 Nicaragua................................ 127 125 133 89 119 45 Tanzania........................ 11 21 30 18 Paraguay.................................. 46 38 43 43 49 46 Tunisia........................... 19 23 29 33 20 Surinam2.................................. 12 47 Uganda........................... 13 38 22 50 43 Trinidad and Tobago............ 107 31 131 44 167 48 Zambia........................... 22 18 78 14 Other Latin America: All Other: 23 Bermuda.................. 116 100 170 197 177 49 New Zealand................. 47 36 42 29 45 24 British West Indies. 449 627 1,311 2,284 1,874 1 Represents a partial breakdown of the amounts shown in the “Other” 2 Surinam included with Netherlands Antilles until January 1976. categories on Table 3.16. 3.18 LONG-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States Millions of dollars, end of period 1976 1977 Holder, and area or country 1973 1974 1975 Sept. Oct. Nov. Dec. Jan. Feb.** Mar.*1 1 Total.............................................................................. 1,462 1,285 1,812 2,206 2,315 2,310 2,393 2,352 2,297 2,302 2 Nonmonetary international and regional organizations............................................................ 761 822 415 214 333 308 261 263 248 250 3 Foreign countries......................................................... 700 464 1,397 1,991 1,983 2,003 2,132 2,090 2,049 2,052 4 Official institutions, including central banks. .. 310 124 931 1,386 1,314 1,313 1,352 1,262 1,192 1,165 5 Banks, excluding central banks.......................... 291 261 364 446 499 524 585 604 627 645 6 Other foreigners..................................................... 100 79 100 159 170 165 194 224 230 242 Area or country: 7 Europe...................................................................... 470 226 330 458 489 507 525 555 580 593 8 Germany.............................................................. 159 146 214 312 310 309 313 313 296 354 9 United Kingdom................................................ 66 59 66 87 99 125 132 144 131 125 10 Canada...................................................................... 8 19 23 26 26 26 29 31 29 35 11 Latin America..................................................... 132 115 140 125 151 152 230 244 267 261 12 Middle East oil-exporting countries1................. 94 894 1,340 1,286 1,239 1,251 1,186 1,104 1,091 13 Other Asia2......................................................... 82 7 8 41 27 77 96 68 67 69 14 African oil-exporting countries3......................... * * * * * * * * * 15 Other Africa4.......................................................... 1 1 1 1 1 1 1 2 1 2 16 All other countries................................................. 7 * * 1 1 1 1 4 1 1 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 3.16: 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 □ May 1977 3.19 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Banks in the United States By Country Millions of dollars, end of period 1976 1977 Area and country 1973 1974 1975 Sept. Oct. Nov. Dec. Jan. Feb.?3 Mar.p 1 20,723 39,056 50,231 60,317 60,986 63,890 69,011 63,599 63,414 65,134 2 Foreign countries.................................................... 20,723 39,055 50,229 60,305 60,981 63,884 69,005 63,592 63,409 65,128 3 Europe................................................................. 3,970 6,255 8,987 9,436 10,435 10,797 12,072 10,390 10,764 10,893 4 Austria............................................................ 11 21 15 41 42 54 44 41 42 58 5 Belgium-Luxembourg.................................... 147 384 352 437 504 501 662 554 611 570 6 Denmark........................................................ 48 46 49 57 64 129 85 72 64 67 7 Finland............................................................ 108 122 128 129 137 136 141 137 131 147 8 France............................................................. 621 673 1,471 1,169 1,096 1,098 1,448 1,246 1,372 1,343 9 Germany......................................................... 311 589 436 498 585 577 562 511 667 575 10 Greece............................................................. 35 64 49 117 88 76 79 57 85 54 11 Italy................................................................. 316 345 370 648 733 877 929 875 802 870 12 Netherlands.................................................... 133 348 300 256 399 240 304 246 510 252 13 Norway........................................................... 72 119 71 68 79 85 98 124 127 133 14 Portugal.......................................................... 23 20 16 55 46 53 65 80 90 98 15 Spain............................................................... 222 196 249 265 264 304 429 362 375 284 16 Sweden........................................................... 153 180 167 106 101 93 177 112 85 74 17 Switzerland..................................................... 176 335 237 417 499 511 472 539 530 496 18 Turkey............................................................ 10 15 86 80 125 140 183 199 207 281 19 United Kingdom............................................ 1,459 2,580 4,718 4,844 5,376 5,591 6,068 4,868 4,671 5,218 20 Yugoslavia...................................................... 10 22 38 28 37 38 45 60 64 37 21 Other Western Europe................................... 25 22 27 56 54 58 52 53 60 56 22 U.S.S.R........................................................... 46 46 103 52 83 103 99 82 95 104 23 Other Eastern Europe.................................... 44 131 108 107 123 134 130 177 175 177 24 Canada............................................................... 1,955 2,776 2,817 3,169 3,129 3,136 3,100 2,944 3,510 3,695 25 Latin America.................................................... 5,900 12,377 20,532 30,042 29,275 31,580 34,034 31,435 31,457 32,030 26 Argentina........................................................ 499 720 1,203 961 902 858 962 937 867 914 27 Bahamas......................................................... 883 3,405 7,570 14,192 12,587 14,594 15,340 13,872 14,071 15,436 28 Brazil.............................................................. 900 1,418 2,221 2,891 3,125 3,259 3,383 3,456 3,145 2,945 29 Chile............................................................... 151 290 360 343 350 358 396 370 379 357 30 Colombia........................................................ 397 713 689 459 517 523 575 593 598 544 31 Cuba............................................................... 12 14 13 13 13 14 13 13 13 13 32 Mexico............................................................ 1,373 1,972 2,802 3,457 3,211 3,285 3,414 3,366 3,331 3,278 33 Panama........................................................... 274 505 1,052 809 1,119 781 1,021 760 861 849 34 Peru................................................................. 178 518 583 694 638 629 690 737 748 733 35 Uruguay......................................................... 55 63 51 28 28 35 38 41 39 39 36 Venezuela........................................................ 518 704 1,086 1,305 1,338 1,512 1,553 1,296 1,260 1,241 37 Other Latin American republics................... 493 852 967 1,112 1,037 1,068 1,140 1,128 1,120 1,133 38 Netherlands Antilles1.................................... 13 62 49 42 41 43 40 45 41 41 39 Other Latin America..................................... 154 1,142 1,885 3,737 4,369 4,620 5,469 4,824 4,985 4,509 40 8,224 16,226 16,057 15,695 16,099 16,365 17,765 16,686 15,471 16,117 41 China, People’s Republic of (Mainland). . . 31 4 22 4 5 3 3 4 30 5 42 China, Republic of (Taiwan)........................ 140 500 736 981 991 1,099 987 1,028 1,089 1,124 43 Hong Kong.................................................... 147 223 258 252 208 267 361 229 265 317 44 India............................................................... 16 14 21 33 64 48 41 28 23 32 45 Indonesia........................................................ 88 157 102 119 117 120 76 54 55 53 46 Israel............................................................... 155 255 491 313 320 330 554 344 337 328 47 Japan............................................................... 6,398 12,518 10,776 10,220 10,534 10,428 10,992 10,579 9,472 9,485 48 Korea.............................................................. 403 955 1,561 1,594 1,555 1,577 1,722 1,710 1,574 1,736 49 Philippines...................................................... 181 372 384 472 478 495 559 592 479 463 50 Thailand.......................................................... 273 458 499 434 415 414 422 421 446 491 51 Middle East oil-exporting countries2........... 330 524 721 765 1,082 1,312 981 1,044 1,389 52 Other3............................................................. 392 441 684 553 647 503 735 714 658 693 53 Africa................................................................. 388 855 1,228 1,332 1,382 1,394 1,486 1,519 1,478 1,613 54 Egypt.............................................................. 35 111 101 114 106 109 132 151 126 149 55 Morocco......................................................... 5 18 9 17 8 14 13 19 13 26 56 South Africa................................................... 129 329 545 691 772 748 763 798 797 802 57 Zaire............................................................... 61 98 34 23 14 25 29 16 11 10 58 Oil-exporting countries4................................ 115 231 176 215 213 257 238 249 343 59 Other3............................................................. 158 185 308 312 267 284 292 298 282 283 60 Other countries................................................... 286 565 609 631 661 612 549 618 729 779 61 Australia......................................................... 243 466 535 521 558 502 450 512 604 663 62 All other......................................................... 43 99 73 110 103 110 99 105 125 116 63 Nonmonetary international and regional organizations.................................................. 1 * 1 12 5 6 5 7 5 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

Bank-reported Data A61 3.20 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Banks in the United States By Type of Claim Millions of dollars, end of period 1976 1977 Type 1973 1974 1975 Sept. Oct. Nov. Dec. Jan. Feb .p Mar.p 1 20,723 39,056 50,231 60,317 60,986 63,890 69,011 63,599 63,414 65,134 2 Payable in dollars.................................................. 20,061 37,859 48,902 58,661 59,330 62,085 67,365 61,867 61,455 63,236 3 Loans, total........................................................ 7,660 11,291 13,205 14,914 16,221 16,191 18,347 16,085 16,234 15,845 4 Official institutions, including central banks. 284 381 613 781 1,055 1,269 1,452 1,250 935 848 5 Banks, excluding central banks..................... 4,538 7,332 7,665 9,003 10,015 9,639 11,081 9,334 9,764 9,743 6 All other, including nonmonetary interna­ tional and regional organizations............. 2,838 3,579 4,926 5,130 5,151 5,282 5,815 5,500 5,535 5,254 7 Collections oustanding...................................... 4,307 5,637 5,467 5,746 5,586 5,628 5,846 5,833 5,868 6,195 8 Acceptances made for accounts of foreigners... 4,160 11,237 11,147 11,213 11,461 11,422 12,367 12,018 12,140 12,936 9 Other claims1..................................................... 3,935 9,689 19,082 26,789 26,015 28,843 30,805 27,931 27,214 28,260 10 Payable in foreign currencies................................. 662 1,196 1,329 1,656 1,704 1,805 1,645 1,732 1,959 1,898 11 Deposits with foreigners.................................... 428 669 656 1,029 1,052 1,084 1,063 1,126 1,091 1,100 12 Foreign government securities, commercial and finance paper.......................................... 119 289 301 120 102 85 84 145 272 323 13 Other claims....................................................... 115 238 372 507 550 635 498 460 596 474 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. 3.21 LONG-TERM CLAIMS ON FOREIGNERS Reported by Banks in the United States Millions of dollars, end of period 1976 1977 Type, and area or country 1973 1974 1975 Sept. Oct. Nov. Dec. Jan. Feb .p Mar.p 1 5,996 7,179 9,540 11,205 11,345 11,612 11,687 11,684 11,873 12,240 By type: 2 Payable in dollars................................................... 5,924 7,099 9,423 11,063 11,206 11,465 11,539 11,534 11,662 12,050 3 Loans, total........................................................ 5,446 6,490 8,316 9,551 9,670 9,837 9,933 9,953 10,131 10,421 4 Official institutions, including central banks 1,156 1,324 1,350 1,312 1,323 1,364 1,420 1,404 1,522 1,612 5 Banks, excluding central banks..................... 591 929 1,567 2,039 2,115 2,164 2,212 2,178 2,231 2,201 6 All other, including nonmonetary interna­ tional and regional organizations............. 3,698 4,237 5,399 6,201 6,232 6,308 6,298 6,371 6,377 6,607 7 Other long-term claims..................................... 478 609 1,107 1,512 1,536 1,628 1,606 1,580 1,531 1,629 8 Payable in foreign currencies................................. 72 80 116 142 139 147 148 150 211 190 By area or country: 9 Europe................................................................ 1,271 1,908 2,708 3,133 3,191 3,285 3,246 3,309 3,362 3,616 10 Canada............................................................... 490 501 555 623 570 590 586 518 536 566 11 Latin America.................................................... 2,116 2,614 3,468 4,519 4,565 4,694 4,806 4,878 4,950 4,951 12 Asia..................................................................... 1,582 1,619 1,795 1,856 1,901 1,885 1,886 1,835 1,841 1,891 13 Japan............................................................... 251 258 296 370 381 368 391 383 363 417 14 Middle East oil-exporting countries1........... 384 220 171 171 141 146 117 123 152 15 Other Asia2.................................................... 1,331 977 1,279 1,315 1,349 1,376 1,349 1,334 1,356 1,322 16 Africa.................................................................. 355 366 747 800 839 888 883 856 876 890 17 Oil-exporting countries3................................ 62 151 236 259 269 264 201 201 209 18 Other4............................................................. 355 305 596 564 580 619 619 655 675 681 19 All other countries5........................................... 181 171 267 274 281 270 280 288 308 327 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. 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A62 International Statistics □ May 1977 3.22 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data Millions of dollars, end of period 1976 1977 Asset account 1973 1974 1975 Aug. Sept. Oct. Nov.r Dec.r Jan. Feb.p All foreign countries 1 Total, all currencies............................ 121,866 151,905 176,493 196,174 199,843 206,383 207,424 219,859 213,094 216,407 2 5,091 6,900 6,743 6,980 6,628 9,939 7,561 7,954 6,518 7,035 3 Parent bank................................. 1,886 4,464 3,665 3,934 3,248 6,834 4,280 4,390 2,935 3,712 4 Other............................................ 3,205 2,435 3,078 3,046 3,381 3,105 3,281 3,564 3,583 3,323 5 111,974 138,712 163,391 182,499 186,192 189,317 192,657 204,864 198,967 202,311 6 Other branches of parent bank 19,177 27,559 34,508 41,000 41,174 41,812 42,729 46,585 47,141 49,084 7 Other banks................................. 56,368 60,283 69,206 71,802 74,796 76,152 77,216 83,576 77,136 77,236 8 Official institutions..................... 2,693 4,077 5,792 8,766 9,208 9,205 9,550 10,608 10,835 11,168 9 Nonbank foreigners................... 33,736 46,793 53,886 60,932 61,015 62,148 63,162 64,095 63,855 64,823 10 Other assets.................................... 4,802 6,294 6,359 6,695 7,022 7,128 7,207 7,041 7,609 7,060 19 MS 105,969 132,901 147,245 150,434 156,031 156,416 168,270 163,855 166,453 12 Claims on United States................. 4,599 6,603 6,408 6,666 6,269 9,595 7,218 7,660 6,239 6,748 13 Parent bank................................. 1,848 4,428 3,628 3,895 3,184 6,790 4,218 4,330 2,896 3,667 14 Other............................................ 2,751 2,175 2,780 2,771 3,085 2,805 3,001 3,330 3,343 3,081 15 Claims on foreigners....................... 73,018 96,209 123,496 137,374 140,919 143,083 145,884 157,407 153,705 156,085 16 Other branches of parent bank.. 12,799 19,688 28,478 33,009 33,358 34,051 34,382 38,540 39,418 41,140 17 Other banks................................. 39,527 45,067 55,319 56,422 58,877 59,316 60,283 66,257 60,660 60,327 18 Official institutions..................... 1,777 3,289 4,864 7,606 7,906 7,885 8,298 9,017 9,468 9,833 19 Nonbank foreigners................... 18,915 28,164 34,835 40,337 40,779 41,831 42,920 43,593 44,159 44,785 20 Other assets.................................... 1,828 3,157 2,997 3,206 3,246 3,353 3,314 3,203 3,911 3,619 United Kingdom 21 Total, all currencies............................ 61,732 69,804 74,883 73,229 73,589 76,854 77,249 81,466 76,482 78,335 22 Claims on United States................. 1,789 3,248 2,392 1,758 2,036 3,256 3,426 3,354 2,262 1,772 23 Parent bank................................. 738 2,472 1,449 938 1,081 2,413 2,538 2,376 1,357 991 24 Other............................................ 1,051 lie 943 821 955 843 888 978 905 781 25 Claims of foreigners........................ 57,761 64,111 70,331 69,298 69,217 71,162 71,477 75,859 71,995 74,713 26 Other branches of parent bank.. 8,773 12,724 17,557 18,044 17,745 18,358 17,949 19,753 19,483 21,450 27 Other banks................................. 34,442 32,701 35,904 34,135 34,405 35,336 35,846 38,089 34,827 35,517 28 Official institutions..................... 735 788 881 1,007 1,138 1,211 1,168 1,274 1,377 1,595 29 Nonbank foreigners................... 13,811 17,898 15,990 16,112 15,929 16,257 16,514 16,743 16,309 16,150 30 Other assets.................................... 2,183 2,445 2,159 2,173 2,335 2,436 2,345 2,253 2,225 1,851 40,323 49,211 57,361 54,522 54,547 57,161 57,699 61,587 57,758 60,036 32 Claims on United States................. 1,642 3,146 2,273 1,658 1,902 3,124 3,313 3,275 2,185 1,684 33 Parent bank................................. 730 2,468 1,445 934 1,064 2,406 2,523 2,374 1,352 988 34 Other............................................ 912 678 828 724 838 719 789 902 833 696 35 Claims on foreigners....................... 37,817 44,694 54,121 52,006 51,782 53,112 53,541 57,488 54,735 57,492 36 Other branches of parent bank.. 6,509 10,265 15,645 15,401 15,195 15,829 15,405 17,249 17,183 19,114 37 Other banks................................. 23,389 23,716 28,224 25,826 25,866 26,421 27,008 28,983 26,184 26,767 38 Official institutions..................... 510 610 648 799 862 912 817 846 1,110 1,320 39 Nonbank foreigners................... 7,409 10,102 9,604 9,980 9,859 9,950 10,311 10,410 10,258 10,291 40 Other assets.................................... 865 1,372 967 858 863 925 845 824 838 860 Bahamas and Caymans 41 Total, all currencies............................ 23,771 31,733 45,203 57,677 60,753 63,508 61,758 67,398 67,393 67,271 42 Claims on United States................. 2,210 2,464 3,229 3,554 3,330 5,464 2,892 3,461 3,148 3,696 43 Parent bank................................. 317 1,081 1,477 1,641 1,257 3,490 766 1,095 161 1,393 44 Other............................................ 1,893 1,383 1,752 1,913 2,072 1,973 2,126 2,365 2,381 2,303 45 Claims on foreigners........................ 21,041 28,453 41,040 52,933 56,255 56,806 57,634 62,720 62,498 62,163 46 Other branches of parent bank.. 1,928 3,478 5,411 6,791 7,250 7,296 7,389 8,853 9,521 9,139 47 Other banks................................. 9,895 11,354 16,298 20,217 22,447 22,136 22,438 25,324 23,748 22,970 48 Official institutions..................... 1,151 2,022 3,576 5,929 6,059 6,040 6,485 7,101 7,004 7,225 49 Nonbank foreigners................... 8,068 11,599 15,756 19,995 20,498 21,334 21,322 21,442 22,225 22,829 50 Other assets.................................... 520 815 933 1,190 1,169 1,239 1,232 1,217 1,747 1,413 51 Total payable in U.S. dollars............. 21,937 28,726 41,887 53,520 56,600 59,219 57,672 63,329 63,180 62,742 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Overseas Branches A63 3.22 Continued 1976 1977 Liability account 1973 1974 1975 Aug. Sept. Oct. Nov.r Dec.r Jan. Feb.*> All foreign countries 52 Total, all currencies.......................... 121,866 151,905 176,493 196,174 199,843 206,383 207,424 219,859 213,094 216,407 53 To United States........................... 5,610 11,982 20,221 27,118 29,978 29,457 30,757 31,684 30,343 29,383 54 Parent bank............................... 1,642 5,809 12,165 16,495 18,957 17,869 19,058 18,318 18,673 18,137 55 Other.......................................... 3,968 6,173 8,057 10,623 11,020 11,588 11,699 13,367 11,670 11,247 56 To foreigners................................. 111,615 132,990 149,815 162,711 163,318 170,083 169,914 181,442 175,879 180,546 57 Other branches of parent bank. 18,213 26,941 34,111 40,071 40,119 41,044 41,692 46,586 45,397 48,867 58 Other banks............................... 65,389 65,675 72,259 74,367 75,054 78,912 77,819 83,302 79,550 77,941 59 Official institutions................... 10,330 20,185 22,113 23,428 23,731 25,019 23,967 25,828 25,480 26,631 60 Nonbank foreigners.................. 17,683 20,189 20,672 24,844 24,414 25,107 26,436 25,725 25,453 27,108 61 Other liabilities............................. 4,641 6,933 6,456 6,346 6,547 6,844 6,753 6,733 6,871 6,478 62 Total payable in U.S. dollars........... 80,374 107,890 135,907 151,788 155,149 160,440 160,875 173,637 168,390 171,528 63 To United States........................... 5,027 11,437 19,503 26,348 29,088 28,683 29,867 30,897 29,402 28,465 64 Parent bank............................... 1,477 5,641 11,939 16,254 18,624 17,633 18,821 18,105 18,419 17,886 65 Other.......................................... 3,550 5,795 7,564 10,094 10,464 11,049 11,046 12,793 10,982 10,580 66 To foreigners................................. 73,189 92,503 112,879 122,187 122,677 128,358 127,585 139,224 135,229 139,425 67 Other branches of parent bank. 12,554 19,330 28,217 32,690 32,921 33,850 33,993 39,317 38,789 41,914 68 Other banks............................... 43,641 43,656 51,583 53,298 53,505 56,302 55,472 60,158 56,973 55,861 69 Official institutions................... 7,491 17,444 19,982 20,620 20,787 21,910 20,924 22,877 22,747 23,598 70 Nonbank foreigners.................. 9,502 12,072 13,097 15,579 15,465 16,296 17,196 16,872 16,720 18,052 71 Other liabilities............................. 2,158 3,951 3,526 3,252 3,383 3,400 3,423 3,515 3,759 3,638 United Kingdom 72 Total, all currencies.......................... 61,732 69,804 74,883 73,229 73,589 76,854 77,249 81,466 76,482 78,335 73 To United States....;................. 2,431 3,978 5,646 5,266 5,379 5,310 5,520 5,997 5,101 4,871 74 Parent bank............................... 136 510 2,122 1,520 1,442 1,468 1,459 1,198 1,211 1,191 75 Other.......................................... 2,295 3,468 3,523 3,746 3,938 3,842 4,061 4,798 3,889 3,681 76 To foreigners................................. 57,311 63,409 67,240 65,883 66,026 69,151 69,368 73,228 69,202 71,523 77 Other branches of parent bank. 3,944 4,762 6,494 6,668 6,788 6,826 6,783 7,092 7,663 7,981 78 Other banks............................... 34,979 32,040 32,964 30,834 31,015 32,488 33,690 36,259 32,627 32,097 79 Official institutions................... 8,140 15,258 16,553 16,147 16,389 17,567 16,181 17,273 16,684 18,204 80 Nonbank foreigners.................. 10,248 11,349 11,229 12,234 11,834 12,270 12,713 12,605 12,228 13,242 81 Other liabilities............................. 1,990 2,418 1,997 2,080 2,184 2,394 2,360 2,241 2,179 1,940 82 Total payable in U.S. dollars........... 39,689 49,666 57,820 55,701 55,625 58,031 58,757 63,174 59,009 61,329 83 To United States........................... 2,173 3,744 5,415 5,093 5,183 5,152 5,330 5,849 4,876 4,704 84 Parent bank............................... 113 484 2,083 1,498 1,404 1,448 1,447 1,182 1,195 1,166 85 Other.......................................... 2,060 3,261 3,332 3,595 3,779 3,704 3,883 4,666 3,681 3,538 86 To foreigners................................. 36,646 44,594 51,447 49,746 49,579 52,017 52,503 56,372 53,230 55,675 87 Other branches of parent bank. 2,519 3,256 5,442 5,604 5,790 5,742 5,520 5,874 6,573 6,906 88 Other banks............................... 22,051 20,526 23,330 20,910 20,526 21,493 23,040 25,527 22,428 22,211 89 Official institutions................... 5,923 13,225 14,498 14,296 14,418 15,550 14,283 15,423 14,893 16,345 90 Nonbank foreigners.................. 6,152 7,587 8,176 8,936 8,846 9,233 9,660 9,547 9,336 10,213 91 Other liabilities............................. 870 1,328 959 862 862 862 924 953 903 950 Bahamas and Caymans 92 Total, all currencies.......................... 23,771 31,733 45,203 SI,611 60,753 63,508 61,758 67,398 67,392 67,271 93 To United States........................... 1,573 4,815 11,147 18,237 21,218 20,640 21,144 21,571 21,617 20,533 94 Parent bank............................... 307 2,636 7,628 12,311 15,243 14,000 14,797 14,587 15,136 14,112 95 Other.......................................... 1,266 2,180 3,520 5,927 5,975 6,640 6,347 6,984 6,481 6,421 96 To foreigners................................. 21,747 26,140 32,949 38,380 38,411 41,815 39,515 44,672 44,363 45,446 97 Other branches of parent bank. 5,508 7,702 10,569 12,416 11,854 13,381 12,931 16,085 14,665 16,861 98 Other banks............................... 14,071 14,050 16,825 20,125 20,621 22,240 19,525 21,389 22,236 20,992 99 Official institutions................... 492 2,377 3,308 2,857 2,712 2,784 3,198 3,573 3,607 3,314 100 Nonbank foreigners.................. 1,676 2,011 2,248 2,982 3,224 3,409 3,861 3,626 3,856 4,279 101 Other liabilities............................. 451 778 1,106 1,059 1,125 1,053 1,099 1,154 1,412 1,293 102 Total payable in U.S. dollars........... 22,328 28,840 42,197 54,154 57,232 59,972 58,244 64,046 63,770 63,553 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 International Statistics n May 1977 3.23 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Holdings and Transactions Millions of dollars 1977 1976 1977 Country or area 1975 1976 Jan.— Mar.p Sept. Oct. Nov. Jan. Feb.p Mar. Holdings, end of period ' 1 Estimated total... 7,703 15,798 13,467 14,487 15,063 15,798 16,307 17,813 18,524 2 Foreign countries. 7,372 12,765 11,671 11,954 12,337 12,765 13,014 13,746 14,706 Europe.............................. 1,085 2,330 2,024 2,064 2,293 2,330 2,300 2,504 2,870 Belgium-Luxembourg.. 13 14 9 13 14 14 14 14 14 Germany...................... 215 764 518 535 746 764 764 789 894 Netherlands................. 16 288 282 283 288 288 287 367 388 Sweden......................... 276 191 240 242 192 191 191 188 188 Switzerland................... 55 261 268 267 291 261 271 324 317 9 United Kingdom......... 363 485 396 403 433 485 476 512 713 10 Other Western Europe. 143 323 307 317 325 323 293 306 354 11 Eastern Europe........... 4 4 4 4 4 4 4 4 4 12 Canada. 395 256 386 390 250 256 256 261 270 13 Latin America............................... 200 312 178 160 302 312 314 295 405 14 Venezuela.................................. 4 149 4 4 149 149 149 149 258 15 Other Latin America republics. 29 35 26 32 28 35 21 21 26 16 Netherlands Antilles 1.............. 161 118 138 113 115 118 125 121 120 17 Asia....... 5,370 9,323 8,552 8,808 8,950 9,323 9,637 10,330 10,793 18 Japan. 3,271 2,687 3,052 3,093 2,587 2,687 2,682 2,806 3,123 19 Africa........ 321 543 531 531 543 543 506 356 356 20 All other. * * * * * * * * 11 21 Nonmonetary international and regional organizations..................................... 331 3,033 1,796 2,533 2,726 3,033 3,294 4,068 3,819 22 International.................... 322 2,905 1,768 2,504 2,655 2,905 3,180 3,948 3,700 23 Latin American regional. 9 128 28 28 71 128 114 119 118 Transactions, netpurchases, or sales (; —), durintg period 24 Total..................... 1,994 8,095 2,727 1,315 1,019 577 735 510 1,505 712 25 Foreign countries. 1,814 5,393 1,941 925 283 383 428 249 731 960 26 Official institutions. 1,612 5,116 1,740 964 227 340 421 229 709 803 27 Other foreign.......... 202 276 201 -39 56 43 6 21 23 157 28 Nonmonetary international and regional organizations..................................... 180 2,702 1,283 390 736 193 307 261 773 248 Memo: Oil-exporting countries 29 Middle East 2.......................... 1,797 3,886 892 315 98 630 140 254 505 133 30 Africa 3.................................... 170 221 -187 10 11 -37 150 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. 3.24 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS Millions of dollars, end of period 1976 1977 Assets 1973 1974 1975 Oct. Nov. Dec. Jan. Feb. Mar. Apr. 1 Deposits................................................................. 251 418 353 362 305 352 383 361 349 305 Assets held in custody: 2 U.S. Treasury securities1................................... 52,070 55,600 60,019 64,942 63,962 66,532 66,992 68,653 71,435 73,261 3 Earmarked gold2............................................... 17,068 16,838 16,745 16,505 16,457 16,414 16,343 16,304 16,271 16,281 1 Marketable U.S. Treasury bills, certificates of indebtedness, notes, Note.—Excludes deposits and U.S. Treasury securities held for inter­ and 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

Investment transactions A65 3.25 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1977 1976 1977 Transactions, and area or country 1975 1976 Jan.- Sept. Oct. Nov. Dec. Jan. Feb.?5 Mar.p Mar.p U.S. corporate securities Stocks 1 Foreign purchases.............................................. 15,347 18,227 3,688 1,124 1,226 977 1,562 1,425 1,162 1,101 2 Foreign sales...................................................... 10,678 15,474 3,152 1,116 1,321 1,025 1,287 1,137 1,035 980 3 Net purchases, or sales ( —)............................... 4,669 2,752 536 9 -95 -49 274 288 127 121 4 Foreign countries................................................ 4,651 2,740 531 7 -98 -50 281 290 125 116 5 Europe............................................................ 2,491 336 249 -60 -251 -118 111 130 47 72 6 France.......................................................... 262 256 21 23 -12 -25 37 27 -10 4 7 Germany..................................................... 251 68 10 -6 -16 -13 24 1 -7 -4 8 Netherlands................................................ 359 -199 9 -26 -37 -29 -35 24 -5 -10 9 Switzerland................................................. 899 -100 92 -55 -95 -44 -7 39 23 30 10 United Kingdom........................................ 594 340 130 29 -72 -5 84 39 36 55 11 Canada............................................................ 361 325 47 5 18 1 60 8 30 9 12 Latin America................................................ -7 155 32 10 -17 25 1 4 14 14 13 Middle East1.................................................. 1,640 1,803 167 60 126 64 115 100 50 17 14 Other Asia2.................................................... 142 117 32 -4 28 -23 9 46 -17 3 15 Africa.............................................................. 10 7 * -4 -3 1 2 * * * 16 Other countries.............................................. 15 -4 4 * 1 * -17 2 1 1 17 Nonmonetary international and regional organizations............................................... 18 12 4 2 4 2 -6 -2 1 5 Bonds3 18 Foreign purchases.............................................. 5,408 5,529 1,276 361 625 355 533 400 534 342 19 Foreign sales...................................................... 4,642 4,322 744 375 386 364 524 322 214 208 20 Net purchases, or sales ( —)............................... 766 1,207 532 -14 239 -9 9 78 320 134 21 Foreign countries................................................ 1,795 1,248 509 -9 203 110 6 73 329 107 22 Europe............................................................ 113 92 359 -16 -10 24 53 8 281 70 23 France......................................................... 82 49 -10 -1 -1 5 7 -5 -3 -2 24 Germany..................................................... -6 -50 * * 5 4 1 -4 4 * 25 Netherlands................................................ -8 -29 -3 * -5 3 -20 2 -2 -3 26 Switzerland................................................. 117 158 78 -7 -2 -3 13 15 32 31 27 United Kingdom........................................ -52 23 271 7 * 15 54 8 225 38 28 Canada............................................................ 128 96 63 18 -1 16 7 11 55 -3 29 Latin America................................................ 31 94 4 5 29 6 27 -5 8 1 30 Middle East1.................................................. 1,553 1,179 100 18 156 74 -21 59 -7 48 31 Other Asia2.................................................... -35 -165 -13 -15 3 -8 -43 1 -8 -6 32 Africa.............................................................. 5 -25 -2 -19 -2 -2 -14 * * -2 33 Other countries.............................................. 1 -21 * * * * -2 * * * 34 Nonmonetary international and regional organizations............................................... -1,030 -41 22 -4 64 -119 3 4 -9 27 Foreign securities 35 Stocks, net purchases, or sales (—)...................... -189 -322 -189 -27 -1 -1 4 -18 -109 -62 36 Foreign purchases.............................................. 1,541 1,937 498 126 132 167 217 181 130 187 37 Foreign sales...................................................... 1,730 2,259 686 153 133, 168 213 199 238 249 38 Bonds, net purchases, or sales ( —)....................... -6,324 -8,547 — 484 -427 -367 -400 -1,298 -30 -374 -80 39 Foreign purchases.............................................. 2,383 4,932 2,012 363 452 455 670 818 581 613 40 Foreign sales...................................................... 8,707 13,479 2,496 790 819 855 1,968 848 955 693 41 Net purchases, or sales ( — ) of stocks and bonds.. -6,514 -8,870 -674 -454 -369 -402 -1,294 -49 -483 -142 42 Foreign countries.................................................... -4,323 -6,972 -985 -471 -282 -270 -765 -338 -488 -159 43 Europe................................................................ -53 -836 -174 -145 -37 -10 -140 -21 -207 54 44 Canada............................................................... -3,202 -5,129 -656 -331 -301 -26 -643 -298 -265 -93 45 Latin America.................................................... -306 1 102 20 13 -28 37 25 42 35 46 Asia..................................................................... -622 -640 -268 -16 34 -10 -24 -53 -61 -154 47 Africa................................................................. 15 48 1 * 1 * 2 -1 2 * 48 Other countries.................................................. -155 -416 10 2 9 -197 3 9 1 * 49 Nonmonetary international and regional organizations.................................................. -2,192 -1,898 312 17 -87 -132 -529 290 5 17 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 □ May 1977 3.26 SHORT-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars, end of period 1975 1976 1975 1976 Type, and area or country Dec.r Mar.r Juner Sept. JDec.2* Dec.r Mar.r Juner Sept. Dec.? Liabilities to foreigners Claims on foreigners 1Total....................................................................... 6,006 6,350 6,301 6,318 6,477 12,151 12,698 13,847 13,190 14,148 By type: 2 Payable in dollars.............................................. 5,402 5,700 5,676 5,702 5,867 11,048 11,713 12,912 12,211 13,211 3 Payable in foreign currencies............................. 605 650 625 615 610 1,103 985 935 980 936 4 Deposits with banks abroad in reporter’s 564 478 496 493 379 5 539 508 439 487 557 By area or country: 5,602 6,132 6,055 6,131 6,269 12,150 12,697 13,846 13,189 14,147 7 2,333 2,344 2,286 2,270 2,122 4,499 4,935 5,330 5,155 5,250 8 14 6 13 15 10 16 17 17 21 21 9 299 296 233 183 166 133 116 193 195 163 10 9 12 12 13 7 39 35 30 26 50 11 Finland........................................................... 14 10 7 21 4 91 36 138 139 79 12 France............................................................. 149 205 159 185 198 291 355 363 413 426 13 Germany........................................................ 149 152 228 256 173 355 305 358 492 377 14 Greece............................................................. 19 25 29 28 48 33 41 47 56 51 15 Italy................................................................. 171 125 116 128 97 381 406 335 358 383 16 Netherlands.................................................... 114 162 170 141 141 167 176 146 142 162 17 Norway........................................................... 20 23 22 24 29 40 58 52 43 49 18 Portugal.......................................................... 4 3 3 5 13 44 45 22 28 40 19 Spain............................................................... 81 68 51 36 40 408 516 432 336 369 20 Sweden........................................................... 29 25 24 35 34 62 80 84 62 89 21 Switzerland..................................................... 130 159 213 241 187 242 207 270 254 241 22 Turkey............................................................ 25 14 20 16 13 28 26 31 23 25 23 United Kingdom............................................ 998 929 846 789 811 1,901 2,280 2,599 2,363 2,437 24 Yugoslavia..................................................... 76 91 108 113 123 36 30 28 30 26 25 Other Western Europe.................................. 8 6 7 8 7 14 18 14 17 19 26 U.S.S.R........................................................... 20 23 10 19 9 150 106 96 81 156 27 Other Eastern Europe................................... 11 10 16 14 13 70 80 75 79 85 28 Canada............................................................... 295 313 369 324 377 2,109 2,234 2,202 2,216 2,449 29 Latin America.................................................... 912 1,176 1,077 1,011 1,017 2,367 2,563 3,053 2,813 3,557 30 Argentina........................................................ 36 41 42 41 38 58 48 43 39 44 31 Bahamas......................................................... 277 376 330 251 260 667 883 1,150 925 1,368 32 Brazil.............................................................. 96 91 90 53 65 409 475 462 417 682 33 Chile............................................................... 14 11 15 16 17 36 27 46 26 34 34 Colombia........................................................ 17 16 19 11 13 49 47 57 66 59 35 Cuba............................................................... * * * * * 1 1 1 1 1 36 Mexico............................................................ 82 92 72 74 95 362 332 332 352 332 37 Panama........................................................... 16 10 12 10 34 91 84 101 83 74 38 Peru................................................................. 29 30 31 32 25 41 38 39 35 42 39 Uruguay......................................................... 3 2 3 3 4 4 4 4 22 5 40 Venezuela........................................................ 100 163 184 222 219 178 156 186 215 194 41 Other Latin American republics................... 71 71 95 100 137 159 170 184 179 270 42 Netherlands Antilles 1................................... 35 58 55 68 10 12 7 10 9 9 43 Other Latin America..................................... 138 214 130 129 101 301 292 437 444 442 44 1,721 1,733 1,752 2,027 2,080 2,631 2,489 2,727 2,419 2,330 45 China, People’s Republic of (Mainland).... 6 5 8 1 20 65 35 23 11 23 46 China, Republic of (Taiwan)........................ 97 110 124 129 112 164 100 215 136 199 47 Hong Kong.................................................... 18 23 28 33 40 111 66 104 88 96 48 India............................................................... 7 9 10 11 23 39 60 51 53 55 49 Indonesia........................................................ 137 141 133 144 136 140 155 160 193 209 50 Israel............................................................... 31 26 34 32 39 54 42 53 48 41 51 Japan.............................................................. 295 307 290 275 228 1,130 1,161 1,169 1,008 912 52 Korea.............................................................. 69 53 62 85 77 263 105 131 142 120 53 Philippines...................................................... 14 18 18 28 53 96 106 114 93 86 54 Thailand......................................................... 18 18 11 23 24 22 20 19 23 22 55 Other Asia...................................................... 1,031 1,022 1,035 1,260 1,326 549 638 691 624 567 56 Africa.................................................................. 390 502 527 432 597 405 343 378 407 390 57 Egypt.............................................................. 37 30 22 25 21 22 22 28 36 28 58 Morocco......................................................... 8 7 32 42 43 10 10 12 9 10 59 South Africa.................................................. 99 113 88 65 54 93 80 83 78 87 60 Zaire............................................................... 6 7 12 24 36 24 23 25 28 21 61 Other Africa................................................... 239 345 372 276 438 256 207 230 257 245 62 Other countries................................................... 70 65 44 67 76 141 133 155 178 171 63 Australia......................................................... 55 41 32 50 51 102 91 100 112 106 64 All other......................................................... 14 18 12 18 19 39 36 56 67 65 65 Nonmonetary international and regional organizations.................................................. 276 219 246 186 208 1 1 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 3.27 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Large Nonbanking Concerns in the United States Millions of dollars, end of period 1976 1977 Type and country 1973 1974 1075 Aug. Sept. Oct. Nov. Dec. Jan. Feb.p 1 Total....................................................................... 3,164 3,357 3,792 5,140 4,725 4,897 5,123 5,419 5,358 5,575 By type: 2 Payable in dollars............................................... 2,625 2,660 3,038 4,559 4,077 4,326 4,600 4,802 4,743 4,941 3 Deposits.......................................................... 2,588 2,591 2,706 4,140 3,707 3,935 4,213 4,429 4,375 4,564 4 Short-term investments 1............................... 37 69 332 419 370 391 387 373 368 377 5 Payable in foreign currencies............................. 540 697 756 582 648 571 523 618 616 634 435 429 510 368 438 339 307 332 308 336 7 Short-term investments 1............................... 105 268 246 214 210 232 216 286 308 298 By country: 8 United Kingdom................................................ 1,118 1,350 1,304 2,077 1,709 1,640 1,693 1,835 1,851 1,844 9 Canada................................................................ 765 967 1,153 1,401 1,336 1,429 1,552 1,539 1,291 1,321 10 Bahamas.............................................................. 589 390 546 823 810 1,059 1,059 1,247 1,312 1,396 11 Japan................................................................... 306 398 343 137 146 116 135 110 127 164 12 All other............................................................. 386 252 445 702 724 653 684 688 m 850 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 cems 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 3.26. 3.28 LONG-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars, end of period 1975 1976 1975 1976 Area and country Dec.r Mar.r June Sept. Dec.p Dec.r Mar.r June Sept. Dec.p Liabilities to foreigners Claims on foreigners 1 4,256 4,069 3,935 3,725 3,507 4,977 5,177 5,034 4,971 4,910 2 Europe.................................................................... 3,267 3,114 2,992 2,820 2,697 1,026 973 984 953 910 3 Germany............................................................ 506 446 425 406 396 37 34 35 73 72 4 Netherlands........................................................ 202 214 214 270 258 217 219 211 211 156 5 Switzerland......................................................... 522 484 467 327 260 59 56 56 54 57 6 United Kingdom............................................... 1,604 1,577 1,493 1,445 1,407 396 349 365 298 297 7 Canada................................................................... 155 144 166 111 86 1,426 1,473 1,516 1,511 1,534 8 Latin America........................................................ 269 248 222 230 241 1,634 1,770 1,602 1,547 1,520 9 Bahamas............................................................. 210 184 157 132 138 8 7 37 37 36 10 Brazil.................................................................. 4 5 5 5 5 170 182 164 171 203 11 Chile................................................................... 1 1 1 1 1 315 312 306 244 248 12 Mexico................................................................ 3 6 6 7 15 216 209 187 219 195 13 496 495 489 498 423 669 685 710 737 771 14 Japan.................................................................. 397 394 388 402 397 90 91 85 80 80 15 Africa..................................................................... 2 2 2 2 2 168 214 163 165 189 16 All other i.............................................................. 66 65 64 64 58 55 61 59 58 58 1 Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 International Statistics □ May 1977 3.29 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Per cent per annum Rate on Apr. 30, 1977 Rate on Apr. 30, 1977 Rate on Apr. 30, 1977 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. . 7.0 Feb. 1977 Italy............................... 15.0 Oct. 1976 Switzerland........ 2.0 June 1976 Brazil 28.0 May 1976 Japan............................. 5.0 Apr. 1977 United Kingdom 8.25 Apr. 1977 Canada.. 8.0 Feb. 1977 Mexico........................... 4.5 June 1942 Venezuela........... 5.0 Oct. 1970 Denmark. 9.0 Mar. 1977 Netherlands................... 4.5 Apr. 1977 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 government securities for commercial banks or brokers. For countries with largest proportion of its credit operations. 3.30 FOREIGN SHORT-TERM INTEREST RATES Per cent per annum, averages of daily figures 1976 1977 Country, or type 1974 1975 1976 Nov. Feb. Apr. 1 Euro-dollars........ 11.01 7.02 5.58 5.29 5.01 5.14 5.08 5.13 5.16 2 United Kingdom. 13.34 10.63 11.35 14.75 14.27 13.53 11.56 10.31 8.59 3 Canada................ 10.47 8.00 9.39 9.08 8.51 8.24 7.78 7.63 7.58 4 Germany---- 9.80 4.87 4.19 4.61 4.82 4.70 4.64 4.70 4.57 5 Switzerland.. 3.01 1.45 2.12 1.98 1.24 1.68 2.88 2.61 6 Netherlands. 5.17 7.02 8.22 6.51 6.18 6.04 5.73 4.89 7 France.......... 7.91 8.65 10.41 10.55 10.02 9.81 9.87 9.33 8 Italy. ... 10.37 16.32 17.76 17.13 15.68 15.86 16.57 16.26 9 Belgium. 6.63 10.25 12.48 10.73 8.49 7.59 7.07 7.01 10 Japan... 11.64 7.70 8.00 8.00 7.50 7.50 7.20 6.46 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. 3.31 FOREIGN EXCHANGE RATES Cents per unit of foreign currency 1976 1977 Country/currency 1974 1975 1976 Nov. Dec. Jan. Feb. Mar. Apr. 1 Australia/dollar.................. 143.89 130.77 122.15 120.66 105.29 108.53 109.04 109.94 110.53 2 Austria/shilling................... 5.3564 5.7467 5.5744 5.8332 5.9061 5.8852 5.8453 5.8822 5.9252 3 Belgium/franc..................... 2.5713 2.7253 2.5921 2.7047 2.7483 2.7249 2.7114 2.7258 2.7509 4 Canada/dollar..................... 102.26 98.30 101.41 101.46 98.204 98.985 97.295 95.125 95.103 5 Denmark/krone................. 16.442 17.437 16.546 16.934 17.145 16.967 16.891 17.038 16.710 6 Finland/markka................. 26.565 27.285 25.938 26.073 26.315 26.313 26.169 26.296 24.899 7 France/franc....................... 20.805 23.354 20.942 20.042 20.055 20.108 20.083 20.075 20.133 8 Germany/deutsche mark... 38.723 40.729 39.737 41.443 41.965 41.792 41.582 41.812 42.119 9 India/rupee......................... 12.460 11.926 11.148 11.155 11.296 11.231 11.285 11.313 11.310 10 Ireland/pound..................... 234.03 222.16 180.48 163.81 167.84 171.24 171.03 171.74 171.90 11 Italy/lira.............................. .15372 .15328 .12044 .11554 .11521 .11372 .11327 .11276 .11264 12 Japan/yen........................... .34302 .33705 .33741 .33879 .33933 .34359 .35087 .35687 .36339 13 Malaysia/ringgit................. 41.682 41.753 39.340 39.513 39.550 39.718 40.011 40.152 40.305 14 Mexico/peso....................... 8.0000 8.0000 6.9161 4.0200 4.8626 4.8114 4.4084 4.3978 4.4076 15 Netherlands/guilder............ 37.267 39.632 37.846 39.678 40.240 39.953 39.813 40.079 40.464 16 New Zealand/dollar........... 140.02 121.16 99.115 95.392 92.179 94.839 95.192 95.689 96.129 17 Norway/krone..................... 18.119 19.180 18.327 18.954 19.193 18.946 18.904 19.035 18.909 18 Portugal/escudo................. 3.9506 3.9286 3.3159 3.1742 3.1674 3.1276 3.0717 2.5778 2.5752 19 South Africa/rand.............. 146.98 136.47 114.85 114.88 114.95 114.94 115.00 115.00 114.93 20 Spain/peseta....................... 1.7337 1.7424 1.4958 1.4626 1.4634 1.4577 1.4475 1.4530 1.4536 21 Sri Lanka/rupee................. 14.978 14.385 11.908 11.479 11.246 11.421 11.442 12.820 13.676 22 Sweden/krona..................... 22.563 24.141 22.957 23.699 24.051 23.734 23.543 23.726 23.004 23 Switzerland/franc............... 33.688 38.743 40.013 40.958 40.823 40.127 39.669 39.209 39.582 24 United Kingdom/pound... 234.03 222.16 180.48 163.81 167.84 171.24 171.03 171.74 171.90 Memo: 25 United States/dollar 1........ 84.11 82.20 89.68 91.06 90.55 90.35 90.55 90.45 90.13 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 Guide to Tabular Presentation and Statistical Releases GUIDE TO TABULAR PRESENTATION Symbols and Abbreviations p Preliminary SMSA’s Standard metropolitan statistical areas r Revised REIT’s Real estate investment trusts rp Revised preliminary * Amounts insignificant in terms of the partic­ e 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, or Rp’s Repurchase agreements (3) figure delayed or, (4) no change (when IPC’s Individuals, partnerships, and corporations figures are expected 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. statistical releases List Published Semiannually, with Latest Bulletin Reference Issue Page Anticipated schedule of release dates for individual releases ....................................... Dec. 1976 A-82 Revised data for call report for March 31, 1976, appear on following two pages. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A70 Commercial Banks o May 1977 1.26 COMMERCIAL BANK ASSETS AND LIABILITIES Revised Detailed Balance Sheet, March 31, 1976-* Asset and liability items are shown in millions of dollars Member banks1 Insured Non­ Asset account commercial Large banks member banks banks1 Total All other New York City of Other City Chicago large 1Cash bank balances, items in process.......................................... 119,029 101,776 27,683 4,185 37,976 31,931 17,260 2 Currency and coin................................................................... 11,216 8,440 843 158 2,716 4,723 2,776 3 28,523 28,523 4,862 2,065 11,787 9,810 4 Demand balances with banks in United States................. 27,673 17,250 6,716 102 3,175 7,256 10,430 5 Other balances with banks in United States.......................... 6,579 4,260 42 16 1,592 2,611 2,319 6 Balances with banks in foreign countries............................... 2,918 2,538 169 41 1,465 864 379 7 Cash items in process of collection........................................ 42,120 40,764 15,052 1,803 17,242 6,667 1,356 8 Total securities held—Book value................................................ 229,517 162,986 18,873 7,459 52,532 84,121 66,534 9 U.S. Treasury.......................................................................... 89,044 65,008 9,568 3,763 21,487 30,189 24,038 10 Other U.S. Govt, agencies...................................................... 33,685 20,914 1,318 350 6,081 13,165 12,771 11 States and political subdivisions............................................. 100,917 73,140 7,479 3,168 23,908 38,585 27,777 12 All other securities................................................................... 5,792 3,870 508 178 1,036 2,148 1,923 n 79 54 20 34 25 14 Trading-account securities........................................................ 5,664 5,584 2,394 772 2,160 259 79 15 U.S. Treasury....................................................................... 3,672 3,641 1,770 625 1,130 115 31 16 Other U.S. Govt, agencies.................................................. 738 732 260 27 396 49 5 17 States and political subdivisions.......................................... 782 764 224 84 407 48 19 18 All other trading acct. securities......................................... 393 393 139 35 206 13 19 79 54 20 34 25 20- Bank investment portfolios....................................................... 223,853 157,401 16,480 6,687 50,373 83,862 66,454 21 U.S. Treasury....................................................................... 85,372 61,367 7,798 3,137 20,357 30,074 24,007 22 Other U.S. Govt, agencies.................................................. 32,947 20,182 1,058 324 5,685 13,116 12,766 23 States and political subdivisions.......................................... 100,135 72,376 7,255 3,083 23,501 38,537 27,759 24 All other portfolio securities............................................... 5,399 3,477 369 143 830 2,135 1,923 25 F.R. stock and corporate stock.................................................. 1,508 1,261 255 82 446 477 248 26 Federal funds sold and securities resale agreement..................... 36,012 27,144 1,910 1,484 13,095 10,655 8,893 27 Commercial banks................................................................... 31,447 22,809 1,115 1,110 10,353 10,231 8,663 28 Brokers and dealers................................................................. 3,200 3,019 352 344 2,008 314 181 29 Others........................................................................................ 1,365 1,316 443 30 734 109 49 30 Other loans, gross......................................................................... An,in 379,971 73,015 20,875 139,159 146,922 111,801 31 Less: Unearned income on loans............................................ 11,217 7,829 492 83 2,654 4,601 3,388 32 Reserves for loan loss.................................................... 6,067 4,862 1,157 331 1,736 1,637 1,205 33 Other loans, net....................................................................... 474,488 367,281 71,366 20,461 134,769 140,684 107,208 Other loans, gross, by category 34 Real estate loans....................................................................... 138,447 98,728 9,836 2,007 35,464 51,421 39,719 35 Construction and land development.................................. 16,019 13,183 3,369 502 6,051 3,261 2,836 36 Secured by farmland............................................................ 6,111 2,645 20 15 273 2,337 3,466 37 78,391 56,705 4,493 923 20,465 30,824 21,686 38 1- to 4-family residences................................................... 73,925 53,421 4,040 827 19,223 29,331 20,504 39 FHA-insured or VA-guaranteed................................. 8,236 7,133 658 52 3,797 2,626 1,104 40 65,689 46,289 3,382 775 15,426 26,705 19,400 41 Multifamily residences...................................................... 4,466 3,284 453 96 1,242 1,493 1,182 42 401 340 111 25 99 90 66 43 4,059 2,944 326 71 1,142 1,404 1,115 44 Secured by other properties................................................ 37,925 26,194 1,954 567 8,675 14,999 11,731 45 Loans to financial institutions.................................................. 37,353 35,465 13,711 4,773 13,999 2,984 1,888 46 To REIT’s and mortgage companies.................................. 10,457 10,148 4,067 1,536 3,805 739 309 47 3,050 2,388 819 111 1,038 421 662 48 5,687 5,560 2,671 327 2,154 408 126 49 2,194 2,067 818 15 1,063 171 126 50 15,966 15,301 5,335 2,783 5,938 1,245 664 51 Loans to security brokers and dealers.................................... 6,125 6,017 4,206 627 1,062 122 108 52 Other loans to purch./carry securities.................................... 3,863 3,233 411 315 1,613 895 630 53 20,434 11,380 95 170 2,589 8,526 9,054 54 Commercial and industrial loans............................................ 167,026 138,870 36,560 10,642 52,771 38,898 28,156 55 105,635 74,954 5,755 1,604 26,374 41,221 30,681 56 83,192 58,745 4,094 903 20,964 32,784 24,447 57 34,200 22,522 708 157 6,729 14,928 11,677 58 Residential-repair/modernize.......................................... 5,839 4,161 312 35 1,688 2,126 1,678 59 Credit cards and related plans........................................ 11,926 10,523 1,397 511 5,714 2,901 1,403 60 Charge-account credit cards........................................ 9,252 8,306 991 481 4,645 2,190 946 61 Check and revolving credit plans................................ 2,674 2,217 406 30 1,069 711 457 62 15,088 10,457 281 92 3,699 6,385 4,632 63 Mobile homes............................................................... 8,641 6,200 164 36 2,231 3,768 2,441 64 Other............................................................................. 6,447 4,257 116 56 1,468 2,617 2,190 65 16,139 11,082 1,396 108 3,133 6,445 5,057 66 Single-payment loans to individuals................................... 22,443 16,209 1,661 701 5,411 8,437 6,234 67 All other loans......................................................................... 12,888 11,323 2,442 738 5,288 2,855 1,565 68 Total loans and securities, net..................................................... 741,525 558,671 92,404 29,486 200,843 235,938 182,882 4,201 3,988 696 129 2,559 604 212 70 Fixed assets—Buildings, furniture, real estate........................... 17,834 13,369 1,554 560 5,339 5,917 4,466 71 Investment in unconsolidated subsidiaries................................. 1,983 1,959 836 152 898 72 24 72 Customer acceptances outstanding............................................ 9,752 9,460 5,010 372 3,794 284 291 73 Other assets.................................................................................. 25,296 22,435 8,112 1,677 8,885 3,760 2,907 919,620 711,659 136,296 36,562 260,295 278,505 208,043 For notes see opposite page. 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Commercial Banks A71 1.26 Continued^ Member banks1 Insured Non­ Liability or capital account commercial Large banks member banks banks1 Total All other New York City of Other City Chicago large 295,012 231,681 55,009 9,057 81,115 86,500 63,331 76 Mutual savings banks............................................................ 1,034 941 450 2 204 285 92 77 Other individuals, partnerships, and corporations.............. 228,642 173,792 31,011 6,570 63,816 72,395 54,849 78 U.S. Govt................................................................................ 2,474 1,798 136 25 646 990 676 79 States and political subdivisions............................................ 15,860 11,183 634 191 3,339 7,019 4,677 80 Foreign governments, central banks, etc.............................. 1,434 1,388 1,173 18 166 30 47 81 Commercial banks in United States..................................... 29,640 28,582 13,835 1,823 9,511 3,413 1,058 82 Banks in foreign countries.................................................... 5,518 5,388 4,120 136 1,016 117 130 83 Certified and officers’ checks, etc.......................................... 10,411 8,610 3,651 291 2,417 2,251 1,801 84 Time deposits.............................................................................. 285,634 213,831 35,869 13,466 75,705 88,790 71,803 85 196 150 12 138 45 86 Mutual savings banks............................................................ 556 540 297 2 193 48 16 87 Other individuals, partnerships, and corporations.............. 219,508 162,351 24,723 9,460 56,716 71,452 57,157 88 U.S. Govt................................................................................ 619 478 91 1 200 186 141 89 States and political subdivisions........................................... 46,330 32,822 1,483 1,442 13,696 16,200 13,508 90 Foreign governments, central banks, etc.............................. 8,551 8,338 5,278 1,136 1,892 33 213 91 Commercial banks in United States..................................... 8,525 7,864 3,016 1,340 2,792 716 661 92 Banks in foreign countries.................................................... 1,350 1,287 981 86 203 17 63 93 Savings deposits......................................................................... 179,027 128,701 9,954 2,706 46,229 69,813 50,326 94 Individuals and nonprofit organizations.............................. 170,797 122,765 9,456 2,616 44,216 66,477 48,032 95 Corporations and other profit organizations....................... 5,233 3,880 225 66 1,645 1,944 1,353 96 U.S. Govt................................................................................ 2,930 1,992 222 23 360 1,387 938 97 All other.................................................................................. 67 64 50 8 5 3 98 Total deposits............................................................................. 759,673 574,213 100,832 25,229 203,049 245,103 185,460 99 Federal funds purchased and securities sold under agreements to repurchase....................................................................... 57,248 54,654 12,057 7,536 27,495 7,566 2,594 100 Commercial banks................................................................. 35,330 34,269 6,712 5,261 18,301 3,995 1,061 101 Brokers and dealers............................................................... 5,609 5,409 755 1,001 2,963 689 200 102 Others...................................................................................... 16,309 14,976 4,591 1,273 6,231 2,881 1,333 103 Other liabilities for borrowed money....................................... 4,469 4,165 1,919 58 1,866 321 304 104 Mortgage indebtedness.............................................................. 770 554 57 16 299 182 216 105 Bank acceptances outstanding.................................................. 10,405 10,114 5,634 374 3,822 285 291 106 Other liabilities........................................................................... 15,209 13,220 4,356 897 5,072 2,895 2,065 107 Total liabilities............................................................................ 847,774 656,920 124,856 34,110 241,603 256,351 190,930 108 Subordinated notes and debentures.......................................... 4,549 3,676 917 84 1,697 978 873 109 Equity capital............................................................................. 67,297 51,063 10,523 2,368 16,995 21,176 16,241 110 Preferred stock....................................................................... 53 34 10 24 20 111 Common stock....................................................................... 15,699 11,631 2,439 570 3,695 4,928 4,070 112 Surplus.................................................................................... 27,108 20,273 4,089 1,149 7,092 7,943 6,836 113 Undivided profits................................................................... 22,707 17,902 3,921 600 5,786 7,596 4,807 114 Other capital reserves............................................................. 1,730 1,223 75 50 412 686 508 115 Total liabilities and equity capital............................................. 919,620 711,659 136,296 36,562 260,295 278,505 208,043 Memo: 220,779 160,538 25,986 5,405 53,716 75,430 60,241 Average for last 15 or 30 days: 117 Average cash and due from bank......................................... 117,461 101,148 28,576 4,255 37,278 31,039 16,316 118 Average Federal funds sold and securities purchased under agreements to resell........................................................ 36,702 27,391 1,900 1,379 12,723 11,389 9,340 119 Average total loans................................................................ 486,169 371,806 72,794 20,828 136,099 142,085 114,363 120 Average time deposits of $100,000 or more......................... 144,211 120,666 31,643 11,156 49,255 28,612 23,545 121 Average total deposits........................................................... 751,499 567,979 98,482 25,185 200,717 243,595 183,520 122 Average Federal funds purchased and securities sold under agreements to repurchase.............................................. 59,309 56,744 14,858 7,312 26,869 7,706 2,565 123 Average other liabilities for borrowed money..................... 4,094 3,814 1,677 47 1,803 287 280 124 Standby letters of credit outstanding........................................ 9,758 9,307 4,924 950 2,817 615 452 125 Time deposits of $100,000 or more.......................................... 143,510 121,015 31,753 11,432 48,996 28,834 22,495 126 Certificates of deposit............................................................ 119,935 100,230 26,167 9,273 39,542 25,248 19,705 127 Other time deposits............................................................... 23,575 20,785 5,586 2,159 9,454 3,586 2,790 128 Number of banks....................................................................... 14,368 5,778 12 9 154 5,603 8,595 •4 Revised data shown in this table reflect mainly changes for large 2 Demand deposits adjusted are demand deposits other than domestic banks in New York City and for other large banks. commercial interbank and U.S. Govt., less cash items reported as in Similarly revised data for Mar. 31, 1977, appear on pp. A-18 and A-19. process of collection. Henceforth the Board does not plan to include revised data for in­ dividual call reports in the Bulletin. Its journal of record will be the Note.—Data include consolidated reports, including figures for all Annual Statistical Digest, each issue of which will contain all revised bank-premises subsidiaries and other significant majority-owned do­ data available at the time of publication—for call report data as well as mestic subsidiaries. Securities are reported on a gross basis before deduc­ other series. tions of valuation reserves. Holdings by type of security will be reported 1 Member banks exclude and nonmember banks include 5 noninsured as soon as they become available. trust companies that are members of the Federal Reserve System, and Back data in lesser detail were shown in previous Bulletins. Details member banks exclude 2 national banks outside the continental United may not add to totals because of rounding. States. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Board of Governors of the Federal Reserve System Arthur F. Burns, Chairman Stephen S. Gardner, Vice Chairman Henry C. W allich Philip E. C oldw ell 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 ’C onnell, Counsel to the John M. D enkler, Staff Director Chairman Stephen H. A xilrod, Staff Director R obert J. Law rence, Deputy Staff M ilton W. Hudson, Assistant to the A rthur L. Broida, Deputy Staff Director Director Chairman M urray A ltm ann, Assistant to the Board G ordon B. Grim wood, Assistant Director Joseph R. Coyne, Assistant to the Board Peter M. Keir, Assistant to the Board and Program Director for K enneth A. G uenther, Assistant to the Board Stanley J. Sigel, Assistant to the Board Contingency Planning Jay Paul Brennem an, Special Assistant to the Normand R. V. Bernard, Special Assistant to W illiam W. L ayton, Director of Equal Board the Board Employment Opportunity Frank O’Brien, Jr., Special Assistant to the Board DIVISION OF RESEARCH AND STATISTICS Joseph S. Sims, Special Assistant to the Board D onald J. W inn, Special Assistant to the James L. K ichline, Director Board Joseph S. Z eisel, Deputy Director Edward C. E ttin, Associate Director John H. K alchbrenner, Associate Director James B. Eckert, Senior Research Division LEGAL DIVISION Officer E leanor J. Stock w ell, Senior Research John D. Hawke, Jr., General Counsel Division Officer DIVISION OF FEDERAL RESERVE Baldw in B. T u ttle, Deputy General James R. W etzel, Senior Research Division BANK EXAMINATIONS AND BUDGETS Counsel Officer Robert E. M annion, Assistant General R obert A. Eisenbeis, Associate Research W illiam H. W allace, Director Counsel Division Officer A lbert R. H am ilton, Associate Director A llen L. Raiken, Assistant General Counsel tJoHN J. M ingo, Associate Research Division C lyde H. Farnsw orth, Jr., Assistant Director Gary M. W elsh, Assistant General Counsel Officer John F. H oover, Assistant Director C harles R. M cN eill, Assistant to the J. C ortland G. Peret, Associate Research P. D. Ring, Assistant Director General Counsel Division Officer A72 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

DIVISION OF DIVISION OF CONSUMER AFFAIRS H elm ut F. W endel, Associate Research FEDERAL RESERVE BANK OPERATIONS Division Officer Janet O. H art, Director James M. Brundy, Assistant Research James R. K udlinski, Director N athaniel E. B utler, Associate Director Division Officer W alter A. A lthausen, Assistant Director Jerauld C. K luckm an, Associate Director Jared J. E nzler, Assistant Research Division Brian M. C arey, Assistant Director Officer H arry A. G uinter, Assistant Director Robert M. Fisher, Assistant Research OFFICE OF THE SECRETARY Division Officer DIVISION OF DATA PROCESSING Richard H. Puckett, Assistant Research Theodore E. A llison, Secretary Division Officer C harles L. Ham pton, Director G riffith L. G arwood, Deputy Secretary Stephen P. T aylor, Assistant Research Bruce M. B eardsley, Associate Director *R uth A. R eister, Assistant Secretary Division Officer U yless D. B lack, Assistant Director Levon H. G arabedian, Assistant Director G lenn L. Cummins, Assistant Director R obert J. Zem el, Assistant Director DIVISION OF BANKING SUPERVISION AND REGULATION DIVISION OF INTERNATIONAL FINANCE DIVISION OF PERSONNEL John E. Ryan, Acting Director John E. R eynolds, Acting Director David L. Shannon, Director W illiam W. W iles, Associate Director Edwin M. Truman, Associate Director C harles W . W ood, Assistant Director Peter E. Barn a, Assistant Director R obert F. Gem m ill, Senior International Frederick R. D ahl, Assistant Director Division Officer Jack M. Egertson, Assistant Director G eorge B. H enry, Senior International OFFICE OF THE CONTROLLER John T. M cC lintock, Assistant Director Division Officer Thomas E. M ead, Assistant Director Reed J. Irvine, Senior International John K akalec, Controller Robert S. Plotkin, Assistant Director Division Officer T yler E. W illiam s, Jr., Assistant Controller Thomas A. Sidman, Assistant Director Sam uel Pizer, Senior International Division Officer DIVISION OF ADMINISTRATIVE SERVICES C harles J. Siegman, Senior International Division Officer W alter W. Kreim ann, Director D onald E. A nderson, Assistant Director *On loan from the Federal Reserve Bank of Minneapolis. John D. Sm ith, Assistant Director tOn leave of absence. A73 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 74 Federal Open Market Committee A rthur F. Burns, Chairman Paul A. V olcker, Vice Chairman Philip E. Coldwell Philip C. Jackson, Jr. J. Charles Partee Stephen S. Gardner David M. Lilly Lawrence K. Roos Roger Guffey Robert P. Mayo Henry C. Wallich Frank E. Morris A rthur L. Broida, Secretary A natol B albach, Associate Economist M urray A ltm ann, Deputy Secretary Richard G. Davis, Associate Economist Normand R. V. Bernard, Assistant Thomas Davis, Associate Economist Secretary Robert Eisenm enger, Associate Economist Thomas J. O’C onnell, General Counsel Edward C. E ttin, Associate Economist Edward G. Guy, Deputy General Counsel James L. K ichline, Associate Economist B aldw in B. T u ttle, Assistant General John E. R eynolds, Associate Economist Counsel K arl Scheld, Associate Economist Stephen H. A xilrod, Economist Edwin M. Truman, Associate Economist Joseph S. Z eisel, Associate Economist A lan R. Holm es, Manager, System Open Market Account Peter D. Sternlight, Deputy Manager for Domestic Operations Scott E. Pardee, Deputy Manager for Foreign Operations Federal Advisory Council Richard D. H ill, first federal reserve district, President G ilbert F. B radley, tw elfth federal reserve district, Vice President Walter B. Wriston, second federal Edward Byron Smith, seventh federal reserve district RESERVE DISTRICT Roger S. Hill as, third federal Donald E. Lasater, eighth federal reserve district RESERVE DISTRICT M. Brock W eir, fourth federal Richard H. Vaughan, ninth federal reserve district RESERVE DISTRICT John H. Lumpkin, fifth federal J. W. McLean, tenth federal reserve district RESERVE DISTRICT Frank A. Plummer, sixth federal Ben F. Love, eleventh federal RESERVE DISTRICT RESERVE DISTRICT H erbert V. Prochnow , Secretary W illiam J. Korsvik, Associate Secretary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A75 Federal Reserve Banks, Branches, and Offices FEDERAL RESERVE BANK, Chairman President Vice President branch, or facility Zip Deputy Chairman Fifst 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 Vacant 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 Vacant Little Rock ............. 72203 Ronald W. Bailey John F. Breen Louisville ............... 40201 James C. Hendershot Donald L. Henry Memphis ................. 38101 Frank A. Jones, Jr. L. Terry Britt MINNEAPOLIS 55480 James P. McFarland Mark H. Willes 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 Henry R. Czerwinski 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 76 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. 125 pp. 1967. 29 pp. $.25 each; 10 or more to one address, $.20 each. Annual Report Bank Credit-Card and Check-Credit Plans. 1968. 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 Con­ sions, 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 one address, $.20 each. $4.00 per copy for each paid subscription to Fed­ eral Reserve Bulletin. All others, $5.00 each. Joint Treasury-Federal Reserve Study of the Government Securities Market: Staff Stud­ Federal Reserve M onthly Chart Book. Subscrip­ ies—Part 1. 1970. 86 pp. $.50 each; 10 or more tion includes one issue of Historical Chart Book. to one address, $.40 each. Part 2. 1971. 153 pp. $12.00 per year or $1.25 each in the United States, and Part 3. 1973. 131 pp. Each volume $1.00; its possessions, Canada, and Mexico; 10 or more 10 or more to one address, $.85 each. of same issue to one address, $1.00 each. Else­ Open Market Policies and Operating Proce­ where, $15.00 per year or $1.50 each. dures—Staff Studies. 1971. 218 pp. $2.00 Historical Chart Book. Issued annually in Sept. each; 10 or more to one address, $1.75 each. Subscription to Monthly Chart Book includes one Reappraisal of the Federal Reserve Discount issue. $1.25 each in the United States, its posses­ Mechanism. Vol. 1. 1971. 276 pp. Vol. 2. 1971. sions, Canada, and Mexico; 10 or more to one 173 pp. Vol. 3. 1972. 220 pp. Each volume $3.00; address, $1.00 each. Elsewhere, $1.50 each. 10 or more to one address, $2.50 each. Capital Market Developments. Weekly. $15.00 per The Econometrics of Price Determination Con­ year or $.40 each in the United States, its posses­ ference, October 30-31, 1970, Washington, D.C. 1972. 397 pp. Cloth ed. $5.00 each; 10 or more sions, Canada, and Mexico; 10 or more of same to one address, $4.50 each. Paper ed. $4.00 each; issue to one address, $13.50 per year or $.35 each. 10 or more to one address, $3.60 each. Elsewhere, $20.00 per year or $.50 each. Federal Reserve Staff Study: Ways to Moderate Selected Interest and Exchange rates—Weekly Fluctuations in Housing Construction. 1972. Series of Charts. Weekly. $15.00 per year or 487 pp. $4.00 each; 10 or more to one address, $.40 each in the United States, its possessions, $3.60 each. Canada, and Mexico; 10 or more of same issue Lending Functions of the Federal Reserve to one address, $13.50 per year or $.35 each. Banks. 1973. 271 pp. $3.50 each; 10 or more Elsewhere, $20.00 per year or $.50 each. to one address, $3.00 each. The Federal Reserve Act, as amended through De­ Introduction to Flow of Funds. 1975. 64 pp. $.50 cember 1971, with an appendix containing provi­ each; 10 or more to one address, $.40 each. sions of certain other statutes affecting the Federal Improving the Monetary Aggregates (Report of the Reserve System. 252 pp. $1.25. Advisory Committee on Monetary Statistics). Regulations of the Board of Governors of the 1976. 43 pp. $1.00 each; 10 or more to one Federal Reserve System address, $.85 each. Published Interpretations of the Board of Gov­ Annual Percentage Rate Tables (Truth in Lend­ ernors, as of June 30, 1976. $7.50. 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 77 CONSUMER EDUCATION PAMPHLETS Measures of Security Credit. 12/70. Revised Measures of Manufacturing Capacity (Short pamphlets suitable for classroom use. Multiple Utilization. 10/71. copies available without charge.) Revision of Bank Credit Series. 12/71. Assets and Liabilities of Foreign Branches of The Equal Credit Opportunity Act and . . . Age U.S. Banks. 2/72. The Equal Credit Opportunity Act and . . Bank Debits, Deposits, and Deposit Turnover— Women 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. What Truth in Lending Means to You Revision of Consumer Credit Statistics. 10/72. One-Bank Holding Companies Before the 1970 STAFF ECONOMIC STUDIES Amendments. 12/72. 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 Commer­ research. 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. Recent Trends in Local Banking Market Struc­ An Assessment of Bank Holding Companies, Staff ture, by Samuel H. Talley. May 1977. 26 pp. Economic Study by Robert J. Lawrence and Samuel H. Talley, 1/76. Printed in Full in the Bulletin Industrial Electric Power Use. 1/76. Revision of Money Stock Measures. 2/76. Staff Economic Studies shown in list below. Survey of Finance Companies, 1975. 3/76. Revised Series for Member Bank Deposits and Aggregate Reserves. 4/76. REPRINTS Industrial Production—1976 Revision. 6/76. (Except for Staff Papers, Staff Economic Studies, and Federal Reserve Operations in Payment Mecha­ some leading articles, most of the articles reprinted do nisms: A Summary. 6/76. not exceed 12 pages.) Recent Growth in Activities of U.S. Offices of Banks. 10/76. New Estimates of Capacity Utilization: Manu­ Seasonal Factors Affecting Bank Reserves. 2/58. facturing and Materials. 11/76. Measures of Member Bank Reserves. 7/63. U.S. International Transactions in a Recovering Research on Banking Structure and Perform­ Economy. 4/77. ance, Staff Economic Study by Tynan Smith. Bank Holding Company Financial Developments 4/66. in 1976. 4/77. A Revised Index of Manufacturing Capacity, Changes in Bank Lending Practices, 1976. 4/77. Staff Economic Study by Frank de Leeuw with Changes in Time and Savings Deposits at Com­ Frank E. Hopkins and Michael D. Sherman. 11/66. mercial Banks, July-Oct. 1976. 4/77. U.S. International Transactions: Trends in Survey of Terms of Bank Lending—New Series. 1960-67. 4/68. 5/77. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A78 Federal Reserve Bulletin □ May 1977 Index to Statistical Tables References are to pages A-3 through A-71 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 Banks, by classes, 16, 17, 19, 20-23, 71 Assets and liabilities (See also Foreigners): Ownership by individuals, partnerships, and Banks, by classes, 16, 17, 18, 20-23, 29, 70 corporations, 25 Federal Reserve Banks, 12 Subject to reserve requirements, 15 Nonfinancial corporations, current, 38 Turnover, 13 Automobiles: Deposits (See also specific types of deposits): Consumer instalment credit, 42, 43 Banks, by classes, 3, 16, 17, 19, 20-23, 29, 71 Production, 48, 49 Federal Reserve Banks, 4, 12 Subject to reserve requirements, 15 BANK credit proxy, 15 Discount rates at F.R. Banks (See Interest rates) Bankers balances, 16, 18, 20, 21, 22, 70 Discounts and advances by F.R. Banks (See Loans) (See also Foreigners) Dividends, corporate, 38 Banks for cooperatives, 35 Bonds (See also U.S. Govt, securities): EMPLOYMENT, 46, 47 New issues, 36, 37 Euro-dollars, 15, 27 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, 34 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 types and ownership of gross debt, 32 equipment, 39 Receipts and outlays, 30, 31 Business loans (See Commercial and industrial loans) 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, 71 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, 70, 71 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, 70, 71 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 Credit unions, 29, 42, 43 Liabilities to, 23, 56-59, 64-67 Currency and coin, 5, 16, 18, 70 Currency in circulation, 4, 14 GOLD: Customer credit, stock market, 28 Certificates, 12 Stock, 4, 55 DEBITS to deposit accounts, 13 Government National Mortgage Assn., 35, 40, 41 Debt (See specific types of debt or securities) Gross national product, 52, 53 Demand deposits: Adjusted, commercial banks, 13, 15, 19 HOUSING, new and existing units, 50 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A79 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, 70, 71 Type of holder and property mortgaged, 41 Interbank deposits, 16, 17, 20, 21, 22, 71 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, 70 Federal Reserve Banks, 3, 8 Federal Reserve Banks, 12 Foreign countries, 68 Member banks, 3, 4, 5, 15, 16, 70 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, 44 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, 70 Securities (See also U.S. Govt, securities): Commercial banks, 3, 15, 16, 17, 70 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 State and local govts.: LABOR force, 47 Deposits, 19, 20, 21, 22 Life insurance companies (See Insurance companies) Holdings of U.S. Govt, securities, 32, 33 Loans (See also specific types of loans): New security issues, 36 Banks, by classes, 16, 17, 18, 20-23, 29, 70 Ownership of securities of, 18, 20, 21, 22, 29 Commercial banks, 3, 15-18, 20-23, 24, 26, 70 Yields of securities, 3 Federal Reserve Banks, 3, 4, 5, 8, 12, 13 State member banks, 17, 70 Insurance companies, 29, 41 Stock market, 28 Insured or guaranteed by U.S., 40, 41 Stocks (See also Securities): Savings and loan assns., 29 New issues, 36, 37 Prices, 28 MANUFACTURERS: Capacity utilization, 46, 47 TAX receipts, Federal, 31 Production, 46, 49 Time deposits, 3, 10, 15, 16, 17, 19, 20, 21, 22, Margin requirements, 28 23, 71 Member banks: Trade, foreign, 55 Assets and liabilities, by classes, 16, 17, 18, 70 Treasury currency, Treasury cash, 4 Borrowings at Federal Reserve Banks, 5, 12 Treasury deposits, 4, 12, 30 Number, by classes, 16, 17, 70, 71 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, Mutual funds (See Investment companies) 33, 70 Mutual savings banks, 3, 10, 20-22, 29, 32, 33, 41 Dealer transactions, positions, and financing, 34 Federal Reserve Bank holdings, 4, 12, 13, 32, 33 NATIONAL banks, 17, 71 Foreign and international holdings and National defense outlays, 31 transactions, 12, 32, 64 National income, 52 Open market transactions, 11 Nonmember banks, 17, 18, 70, 71 Outstanding, by type of security, 32, 33 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

A80 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories * Q HAWAII ■ o \> <2 : © 0 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