Federal Reserve Bulletin, 1978-04
APRIL 1978 FEDERAL RESERVE RTIIJ FTTN R e c e n t D e v e lo p m e n ts in U .S . In te rn a tio n a l T ra n s a c tio n s M o n e ta ry P o lic y a n d O p e n M a rk e t O p e ra tio n s in 1977 E F T a n d P riv a c y 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, Cuba, 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*' 2QS5I, 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
NUMBER 4 □ VOLUME 64 □ APRIL 1978 FEDERAL RESERVE BULLETIN B o a rd o f G o v e rn o rs o f th e F e d e ra l R e s e rv e S y s te m W a s h in g to n , D .C . p u b lic a tio n s c o m m it te e Joseph R. Coyne, Chairman □ Stephen H. Axilrod □ John M. Denkler Janet O. H art □ Jam es L. Kichline □ Neal L. Petersen □ Edwin M. Trum an Richard H. Puckett, Staff D irector 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 o f C ontents 255 U.S. International Transactions banks, representing 98 per cent of all insured com m ercial banks, had al The uneven growth of econom ic activ ready been provided to the committee ity among major industrial countries by the Federal D eposit Insurance has had a m ajor im pact on de Corporation. velopm ents in the international sector of the U.S. econom y during 1977 and early 1978. 290 Record of Policy Actions of the Federal Open Market Committee 265 Monetary Policy and Open At the conclusion of its discussion of Market Operations in 1977 the longer-run growth ranges for the Annual report on dom estic operations m onetary aggregates at the meeting of the Federal Open M arket Commit held on February 28, 1978, the Com tee points out that Federal Reserve mittee decided to retain the existing policy in 1977 worked to encourage a ranges for M -l and M-2 and to reduce healthy expansion in econom ic activ both the upper and lower limits of the ity without a renewed burst of infla range for M-3 by Vi of a percentage tion. point. Thus, the new ranges, which applied to the period from the fourth 279 EFT and Privacy quarter of 1977 to the fourth quarter of 1978, were 4 to 6V2 per cent for M -l, A discussion of the effect of elec 6V2 to 9 per cent for M -2, and IV2 to 10 tronic fund transfers on consum ers, per cent for M -3. The associated especially in the area of personal pri range for growth in commercial bank vacy. Reports of the National Com credit rem ained 7 to 10 per cent. It was mission on Electronic Fund Transfers agreed that the longer-run ranges, as and the Privacy Protection Study well as the particular aggregates for Commission are also analyzed as they which such ranges w ere specified, relate to privacy. would be subject to review and mod ification at subsequent meetings. It 285 Statement to Congress was also understood that short-run J. Charles Partee, m em ber of the factors might cause growth rates from Board of G overnors, presents the month to m onth to fall outside the views of the Board on the results of ranges contem plated for the year the survey on bank stock loans, in ahead. sider loans, and overdrafts that was The Com m ittee decided that opera recently conducted for the Committee tions in the period immediately ahead on Banking, Housing and Urban Af should continue to be directed toward fairs before that com m ittee of the maintaining prevailing money m arket U.S. Senate on M arch 16, 1978. Gov conditions, as represented by the cur ernor Partee focused on the major rent 6% per cent level of the Federal findings of the survey, since summary funds rate. H owever, the members data based on reports from 14,137 agreed that if growth in the aggregates Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
should appear to approach or move swers describing the responsibilities beyond the limits of their specified of banks under the new Fair Debt ranges, the operational objective for Collection Practices Act. the weekly-average Federal funds rate A com m ittee of experts has been should be varied in an orderly fashion formed to review the seasonal adjust within a range of 6V2 to 7 per cent. For ment techniques used by the Board in the annual rates of growth in M-1 and adjusting financial data. M -2 over the February-M arch period, the Committee specified ranges of 1 to The money stock and related m ea 6 per cent and 4Vz to 8V2 per cent, sures have been revised to incorpo respectively. It was understood that in rate the latest benchm ark adjustm ents assessing the behavior of the aggre for nonm em ber banks and revised gates, the M anager should give ap seasonal factors. proximately equal weight to the be The Board has proposed a revision of havior of M-1 and M -2. The members Regulation Y (Bank Holding Com also agreed that in the conduct of panies) as it pertains to the sale of day-to-day operations, account certain types of insurance and has also should be taken of emerging financial proposed rules under which nonbank m arket conditions, including the con ing subsidiaries of U .S.-based bank ditions in foreign exchange m arkets. holding com panies may establish new foreign offices. 306 Law Department The list of over-the-counter stocks Am endm ents to Regulations B and Y ; that are subject to the Board’s margin various bank holding com pany and regulations has been revised. bank m erger orders; and pending cases. 343 Industrial Production 335 Membership of the Board of Output increased an estim ated 1.4 Governors of the per cent in M arch. Federal Reserve System, 1913-78 L ist of appointive and ex officio A 1 Financial and Business Statistics members. A3 Domestic Financial Statistics 337 Announcements A46 Domestic Nonfinancial Statistics A54 International Statistics The Board has am ended Regulation B (Equal Credit Opportunity) to specify A69 Guide to Tabular Presentation what constitutes adverse action in a and Statistical Releases credit transaction at the point of sale. A70 Board of Governors and Staff It has also issued a staff interpretation dealing with the collection of informa A72 Open MarkeY Committee and tion for marketing purposes. (See Law Staff; Advisory Councils Departm ent.) A73 Federal Reserve Banks, The Board has issued a policy state Branches, and Offices m ent alerting State m em ber banks to A74 Federal Reserve Board penalties that may arise from the mis Publications use of inside investm ent information. A76 Index to Statistical Tables The Board has made available a fact sheet and a set of questions and an A78 Map of Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
R e c e n t D e v e lo p m e n ts in U . S . In te rn a tio n a l T ra n s a c tio n s This article was prepared by K athryn A. the absence of other changes, to reduce sig M orisse of the U .S. International Transactions nificantly the U.S. current-account deficit. Section o f the D ivision o f International As the year progressed, it becam e increas Finance. ingly evident that large U .S. current-account deficits were likely to continue beyond 1977. As this view strengthened, a tendency to shift Developments in the international sector of out of dollar-denom inated assets developed, the U.S. econom y during 1977 and early 1978 and pressure on the dollar intensified. The in reflected the uneven growth of economic ac ternational value of the dollar, which had de tivity among major industrial countries. The preciated only slightly on a weighted-average U.S. m erchandise trade balance— and there basis during the first three quarters of 1977, fore the U .S. current account— was dram ati fell 6V2 per cent from the Septem ber peak cally affected. The unprecedented widening of through December. In January-February 1978 the U.S. trade deficit reflected, for the m ost the trade deficit widened to an average of more part, the faster pace of econom ic expansion at than $40 billion at an annual rate. And with the home than abroad (Chart 1) and the sharp in widening of the trade deficit, the international crease in oil im ports. As 1977 ended, economic value of the dollar declined a further 2lA per activity in some foreign countries seem ed to be cent through M arch. Among foreign curren expanding whereas the over-all rate of U.S. cies, the Japanese yen was the focus of much econom ic grow th slowed a bit. H ow ever, of the pressure as the Japanese trade surplus despite the reported pick-up, the pace of for remained very high in the first m onths of the eign economic growth is well below recent his year. torical experience. Given the very large U.S. The current-account sector of the interna deficit, a considerable period of relatively rapid tional transaction accounts adjusts with vary growth in foreign dem and would be needed, in ing lags to developm ents in U.S. and foreign 1. Real GNP and ... industrial production Ql 1973=100 Indexes of foreign real GNP and industrial production (1973 GNP in 1973-76. Foreign industrial production index weights are Ql = 100) are weighted averages for Canada, France, Germany, proportional to U.S. nonagricultural exports to these respective Italy, Japan, and the United Kingdom. Foreign real GNP index countries in 1970-73. Data are from national sources. weights are proportional to country share in 6-country total real Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
256 Federal Reserve Bulletin □ April 1978 1. U.S. international transactions summary vestment income, military, and other trans Billions of dollars, outflow (-) actions increased somewhat, most of the swing in the current account resulted from a widen Item 1976 1977 Change ing of the m erchandise trade deficit by $22 Current-account balance .................. -1.4 -20.2 -18.8 billion; exports expanded only 5 per cent in Private and official capital (recorded), net ................................ -8.4 23.2 31.6 value while imports increased 22 per cent. Foreign official assets in U.S.,net 17.9 37.4 19.5 Several special factors contributed to the Other capital transactions, net... -26.3 -14.2 12.1 1977 trade deficit. Oil im ports rose strongly, Statistical discrepancy........................ 9.9 -3.0 -12.9 reflecting in part abnormally large weather- Note—Details may not add to totals because of rounding. Data related increases in consum ption and substan are from U.S. Dept, of Commerce, Bureau of Economic Analysis. tial private stockbuilding of oil in anticipation economic activity and to changes in relative of a price increase by the Organization of prices and exchange rates. The capital account, Petroleum Exporting Countries (OPEC). Ad which is the sum of net private and official verse price movements for agricultural ex capital m ovements— and which by an account ports also contributed to the deficit. W hile ing identity m ust, along with the statistical prices of coffee and sugar imports were at discrepancy, offset the current account—is or near historic peaks, the prices of grain consequently largely predeterm ined (Table 1). exports fell because of abundant harvests both However, the division of the capital account at home and abroad. between official and private transactions may vary depending upon the degree to which 2. Changes in the U.S. current account official agencies attem pt to influence changes Billions of dollars in the exchange value of their currencies Item 1976 1977 Change through intervention in foreign exchange U.S. current account........ -1.4 -20.2 -18.8 markets. In the absence of large-scale official Trade balance .................. -93 -3L2 -21.9 intervention such as that in late 1977, greater Exports .......................... 114.7 120.5 5.8 stress would have been put on private financing Imports .......................... -124.0 -151.7 -27.7 (Oil) ............................ (-34.6) (-44.7) (-10.1) of the current-account deficit, and exchange Other current-account rates would have reflected those m arket forces. transactions .............. 79 11.0 3.1 Intervention purchases of dollars are indica Investment income, net. 9.8 11.9 2.1 Military transactions, tive that dollar-denominated assets are not as net............................ .4 1.4 no Other services, net----- 2.7 2.5 -.2 attractive to the private sector— at prevailing Unilateral transfers .... -5.0 -4.8 .2 interest rates and exchange rates— as assets Note—Details may not add to totals because of rounding. Data denominated in other currencies. The scale of are from U.S. Dept, of Commerce, Bureau of Economic Analysis. official intervention is determ ined by attem pts by authorities to achieve certain targets for interest rates and exchange rates and by the The change in the U .S. trade balance in 1977 willingness of the private sector to hold finan has been attributed by some analysts to a cial assets dominated in different currencies deterioration in the U.S. com petitive position. at those rates. Consequently, the ex post pat Such a conclusion is not supported by price tern of official capital flows and private capi data. Although there may have been some tal flows is in large part a result of author lagged adjustm ent in trade flows to reduced ities’ objectives for interest rates and ex U.S. price com petitiveness from early 1975 to change rates. mid-1976, all direct m easures of U.S. price com petitiveness show dram atic improvement since mid-1976. Over the past year and a half CURRENT-ACCOUNT OVERVIEW U.S. export, consum er, and wholesale prices and unit labor costs all rose less than the The U.S. current account moved to a deficit of counterpart prices of our m ajor trading $20 billion in 1977 from a deficit of $1 billion in partners, after adjusting for exchange-rate 1976 (Table 2). W hile net receipts from in changes (Chart 2). U.S. price com petitiveness Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
U.S. International Transactions 257 did decline from the end of 1974 through the 3. Net exports and first half of 1976— a period in w hich the w eighted-average value of the dollar ap preciated about 10 per cent— but this decline followed 2 years of steady improvement. M uch of the widening of the U.S. trade deficit in 1977 may be attributed to the differ ent rates of expansion of economic activity at home and abroad in that year. W hereas real GNP grew strongly in the United States for much of the year, aggregate growth of real G N P for other m ajor industrial countries slowed noticeably, and in some individual countries even turned negative for brief periods. As the ratio of foreign to U.S. real GNP declined during 1976 and 1977, the U.S. trade deficit widened greatly (Chart 3). 2. Ratio of United States to foreign countries ... Ql 1973=100 1974_________1975_________1976_________1977________ * Aggregate of 6 major industrial countries weighted by ad justed country shares of world trade (Canada 33 per cent, France 8 per cent, Germany 15 per cent, Italy 7 per cent, Japan 25 per cent, and the United Kingdom 12 per cent). Foreign data are from national sources; U.S. data are from the U.S. Dept, of Commerce, Bureau of Economic Analysis. Another factor, related to the contrast in growth rates, also contributed im portantly to the widening of the U .S. trade deficit. Faced with considerable slack in their dom estic m ar kets in 1977, foreign producers of industrial products— such as steel— and consum er products— such as television sets— becam e more aggressive in their selling efforts, both in the United States and in other m arkets where they compete with U.S. producers. For many foreign producers, how ever, increased ex ports were not sufficient to offset lagging domestic sales. As a result, the aggregate Foreign countries are the aggregate of Group-of-Ten countries and Switzerland weighted by each country’s share in the global capacity utilization of other m ajor industrial exports and imports of these countries. countries dropped sharply in 1977, while in the The ratio equals the U.S. price divided by the aggregate foreign price times the weighted-average value of the dollar. The United States capacity utilization rose as the weighted-average price of the dollar equals the foreign currency economic recovery continued (Chart 4). price of the U.S. dollar of G-10 countries and Switzerland (New York noon buying rate) weighted by the shares of these countries’ One effect of differing econom ic growth exports and imports in the global exports and imports of these rates and differing rates of capacity utilization countries. Data are from national sources and the International Monetary Fund. was the willingness of some foreign producers Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
258 Federal Reserve Bulletin ° April 1978 4. Capacity utilization M erchandise E xports The value of U .S. m erchandise exports rose by only about 5 per cent in 1977— the slowest rate of increase since 1971 (Table 3). Nonagricultural exports increased $5 billion in 1977 to a total of $96 billion. Price rises accounted for all of the increase; volume was practically unchanged. The slowing of eco Ratio: foreign*/U.S nomic growth in m ost major industrial coun tries, particularly during the second and third quarters, and the weakness of investm ent de mand abroad were the main reasons why demand for U.S. capital goods and industrial supplies was held down during the year. Be cause these goods account for about 70 per cent of our nonagricultural exports , their lack * Aggregate of 6 major industrial countries weighted by ad justed country shares of world trade (Canada 33 per cent, France of growth contributed im portantly to the size 8 per cent, Germany 15 per cent, Italy 7 per cent, Japan 25 per of the trade deficit. cent, and the United Kingdom 12 per cent). M achinery exports, valued at $33 billion, were unchanged in volume as increased sales to squeeze their profit margins in 1977 and to of such items as electronic com puters, heating sell more aggressively in the United States and and cooling equipm ent (m ainly to oilin other m arkets; this gave rise to renewed exporting countries), and measuring and con concern that in some cases U .S. industries trolling instrum ents were offset by declines in were being subjected to unfair competition. oilfield drilling equipm ent, m etalw orking 3. U.S. merchandise trade International accounts basis; quarterly data at seasonally adjusted annual rates 1976 1977 Item 1975 1976 1977 Ql Q2 Q3 Q4 Q2 Q3 Q4 Q1 Billions of dollars Export values.......................................... 107.1 114.7 120.5 108.0 113.5 118.4 118.8 117.8 122.6 123.5 118.0 Agricultural....................................... 22.2 23.4 24.4 21.6 23.4 25.0 23.5 24.4 26.7 24.0 22.3 Nonagricultural.................................. 84.8 91.3 96.1 86.4 90.1 93.5 95.3 93.4 95.9 99.5 95.6 Import values.......................................... 98.0 124.0 151.7 113.4 119.8 129.6 133.2 146.4 153.2 153.7 153.5 27.0 34.6 44.7 30.3 33.0 37.6 37.4 44.1 47.5 45.8 41.6 Non-oil................................................ 71.0 89.4 107.0 83.1 86.8 92.0 95.9 102.3 105.7 107.9 111.9 Balance.................................................... 9.0 -9.3 -31.2 -5.4 -6.3 -11.2 -14.4 -28.6 -30.6 -30.2 -35.5 1974 = 100 Volumes Agricultural exports.......................... 101.6 113.8 116.4 105.4 114.7 120.0 113.6 113.0 118.3 119.5 114.4 Nonagricultural exports .................. 96.3 97.6 97.4 94.0 96.8 99.4 98.5 96.6 98.5 100.0 94.4 Oil imports.......................................... 98.2 118.3 141.1 105.2 113.8 129.0 125.9 141.6 149.2 143.7 129.7 Non-oil imports ................................ 83.3 103.8 115.0 99.1 101.3 105.6 109.2 113.0 113.8 114.1 118.9 Unit values Agricultural exports.......................... 97.7 91.7 93.4 91.6 91.0 92.8 92.5 96.4 100.8 89.6 87.1 Nonagricultural exports .................. 116.1 123.2 130.0 121.0 122.7 123.9 127.4 127.4 128.4 131.1 133.5 Oil imports.......................................... 103.5 109.9 119.3 108.2 109.1 109.7 111.6 117.1 119.8 119.9 120.6 Non-oil imports ................................ 110.6 111.8 120.7 108.8 111.2 113.1 114.0 117.5 120.5 122.8 122.1 Note—Details may not add to totals because of rounding. Data are from U.S. Dept, of Commerce, Bureau of Economic Analysis and Bureau of the Census. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
U.S. International Transactions 259 4. U.S. exports, by area1 Change: 1976-77 1974 1975 1976 1977 Billions Areas of dollars Per cent Billions of dollars Total exports (excluding military).................................. 98.3 107.1 114.7 120.5 5.8 5.1 Developed countries....................................................... 64.5 66.5 72.4 76.9 4.5 6.2 Canada............................................................................ 21.8 23.5 26.3 28.2 1.9 7.2 Japan.............................................................................. 10.7 9.6 10.2 10.6 .4 3.9 Western Europe............................................................ 28.2 29.9 31.9 34.4 2.5 7.8 United Kingdom ...................................................... 4.7 4.9 5.1 5.9 .8 15.7 EC (6) ........................................................................ 16.5 17.4 19.2 20.0 .8 4.2 Germany.............................................................. 5.0 5.2 5.7 6.0 .3 5.3 Other Western Europe............................................ 7.0 7.6 7.7 8.4 .7 9.1 Other developed countries ...................................... 3.8 3.5 3.9 3.8 -.1 -2.6 Developing countries .................................................. 31.2 37.0 38.1 40.8 2.7 7.1 OPEC............................................................................. 6.2 10.0 11.6 12.9 1.3 11.2 Other............................................................................. 25.0 27.0 26.6 27.9 1.3 4.9 Communist countries ...................................................... 2.5 3.5 4.2 2.8 -1.4 -33.3 international accounts basis. Note—Data may not add to totals because of rounding. Data are from U.S. Dept, of Commerce, Bureau of Economic Analysis. machinery, and construction and excavating European countries ($2^ billion) and to equipment. The value of exports of civilian Canada ($2 billion) (Table 4). Exports to Japan aircraft, after having been fairly stable for sev were little changed. OPEC countries increased eral years, fell 14 per cent in 1977. Among the their imports from the United States by about industrial supplies, shipm ents of steel and of $\V2 billion; this increase was about the same as products related to steel production (coal and that of 1976, but only about half as large as steel scrap) declined sharply; exports of those in 1974 and 1975. Exports to non-OPEC paper, copper, and lum ber also declined. On developing countries increased about $1^ bil the other hand, shipm ents of chem icals, par lion in 1977 after having declined slightly the ticularly organic com pounds used in making year before. M ost of these increased exports drugs and agricultural chem icals, rose sharply. went to expanding Far Eastern countries, such Agricultural exports increased 4 per cent in as Korea, Taiwan, Hong Kong, and Singapore. 1977, to a record $24 billion. About half of the Some major U.S. trading partners, such as increase was in volume and half in prices. M exico and Brazil, reduced their im ports from Although agricultural export prices increased the United States as they dealt with their large on average during the first half of the year, external deficits. Exports to com m unist coun they dropped 10 per cent between June and tries declined $1^ billion, primarily as a result D ecem ber because of good harvests and of smaller grain sales to the Soviet Union. ample supplies around the world. M ost of the increased value of agricultural exports was in soybeans and cotton; large increases in the M erchandise Im ports value of these exports during the first half of the year were offset only in part by declines in Econom ic expansion in the U nited States both prices and volume later in the year. was fairly strong during the first half of 1977, W heat exports and corn exports each declined and even though it slowed a bit during the more than $1 billion during 1977 as increases third and fourth quarters, real GNP grew by in world supplies lowered both prices and the 4.9 per cent, year over year. The volume of foreign dem and for U .S. crops. imports grew by 13 per cent in 1977, with m ost The relatively small ($6 billion) increase in of the increase occurring in the first half. Based total exports in 1977 went largely to W estern on historical relationships, more than half of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
260 Federal Reserve Bulletin □ April 1978 5. U.S. imports, by commodity categories1 Change: 1976-77 1974 1975 1976 1977 Commodities Billions of dollars Per cent Billions of dollars Total imports................................ 103.6 98.0 124.0 151.7 27.7 22.3 Oil .................................................. 26.0 27.0 34.6 44.7 10.1 29.2 Non-oil.......................................... 77.1 71.0 89.4 107.0 17.6 19.7 Foods ........................................ 10.6 9.7 11.6 14.0 2.4 20.7 Industrial supplies.................. 28.1 24.4 30.2 36.2 6.0 19.9 Capital goods .......................... 9.5 9.7 11.1 13.5 2.4 21.6 Automotive.............................. 12.1 11.8 16.4 18.9 2.5 15.2 From Canada ...................... 5.7 5.9 8.1 9.4 1.3 16.1 From others ........................ 6.4 5.9 8.3 9.5 1.2 14.5 Consumer goods .................... 14.8 13.7 18.4 22.4 4.0 21.7 Other ........................................ 2.0 1.7 1.8 1.9 .1 5.6 international accounts basis. Note—Details may not add to totals because of rounding. Data are from U.S. Dept, of Commerce, Bureau of Economic Analysis. that rise was directly associated with the rise in Foreign car imports increased substantially at GNP. Another large part of the increase was re the end of 1977 as sales were strong and lated to the differing rates of capacity utiliza dealers began to replenish extremely low tion in the United States and other major in stock positions with 1978 models; imports of dustrial countries (Chart 4). foreign automotive vehicles and parts were Imports of commodities other than oil rose valued at $9.5 billion in 1977 compared with about 20 per cent in value (Table 5). A little $8.3 billion in 1976 (Canada excluded). more than half of the increase was in volume Prices of non-oil imports rose 8 per cent on with most of the increase concentrated in average in 1977, led by an increase in food capital goods, industrial supplies, and con prices of nearly 25 per cent (largely from sumer goods (other than foods or automotive coffee). Prices of foreign cars and trucks also products). Together, these items account for rose substantially—by about 13 per cent— in 70 per cent of non-oil imports. The volume of part because of the appreciation of the yen and food imports declined slightly in 1977 in re the mark against the dollar. sponse to a sharp increase in their prices. About $6 billion, or one-third, of the in 6. U.S. non-oil imports, by area1 Change: 1976-77 1974 1975 1976 1977 Areas Billions of dollars Per cent Billions of dollars Non-oil imports, total ................ 774 71.0 89.4 107.0 17.6 19.7 Developed countries.................. 55.7 51.8 63.9 75.5 11.6 18.2 Canada .................................... 18.3 18.0 23.6 27.6 4.0 16.9 Japan ........................................ 12.2 11.3 15.5 18.6 3.1 20.0 Western Europe...................... 23.2 20.3 22.3 26.5 4.2 18.8 United Kingdom ................ 4.1 3.7 4.0 4.5 .5 12.5 EC (6).................................... 13.5 11.9 12.5 15.6 3.1 24.8 Germany .......................... 6.3 5.4 5.6 7.2 1.6 28.6 Other Western Europe----- 5.6 4.8 5.7 6.4 .7 12.3 Other developed countries ... 2.0 2.2 2.5 2.8 .3 12.0 Developing countries ................ 20.4 18.4 24.6 30.4 5.8 23.6 Communist countries ................ .9 .7 .9 1.2 .4 33.3 1 International accounts basis. Note—Details may not add to totals because of rounding. Data are from U.S. Dept, of Commerce, Bureau of Economic Analysis and Bureau of the Census. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
U.S. International Transactions 261 7. U.S. oil production, imports, and consumption Ratio: Period Production Imports1 Consumption imports/ Price of consumption imported oil (Millions of barrels per day) (Per cent) (Dollars per barrel) 1973 ............ 11.4 6.83 17.3 39.5 3.33 1974 ............ 11.0 6.61 16.7 39.6 10.98 1975 ............ 10.5 6.49 16.3 39.8 11.42 1976 ............ 10.4 7.79 17.5 44.5 12.14 1977 ............ e210.5 9.24 e18.3 50.5 13.27 1976—Ql .. 10.5 6.93 17.8 38.9 11.94 Q2 .. 10.3 7.46 16.5 45.2 12.09 Q3 .. 10.3 8.44 16.7 50.5 12.18 Q4 .. 10.2 8.29 18.8 44.1 12.32 1977—Ql .. 10.2 9.32 19.6 47.6 13.00 Q2 .. 10.3 9.77 17.5 55.8 13.37 Q3 .. 210.5 9.42 17.8 52.9 13.32 Q4 .. <*10.8 8.47 *18.4 46.0 13.41 e Estimated. 1 International accounts data; includes imports into the U.S. Virgin Islands. 2 Includes Alaskan production (.34 million of barrels per day in Q3 1977 and .72 million of barrels per day in Q4 1977) Note—Table does not show changes in U.S. inventories separately. Data are from U.S. Dept, of Energy and the U.S. Dept, of Commerce, Bureau of the Census. crease in non-oil imports came from develop ral gas because of a decline in natural gas ing countries (Table 6). Non-oil imports from production, and an increase in inventories of the developed countries rose $12 billion, or 18 oil in anticipation of midyear and end-of-year per cent, with the increase about evenly di increases in prices set by OPEC. The increase vided among Canada, Japan, and the Euro in the demand for imported oil was offset pean Economic Community. slightly by a rise in domestic production as oil U.S. imports of petroleum and products from Alaska’s North Slope was added to pro were $44.7 billion in 1977, up by $10 billion duction in the lower 48 States in the second from 1976. An increase in the quantity of im half of 1977. ported oil accounted for about two-thirds of the total rise in value. The remainder represented N on-Trade a higher import unit value—an average of Current-Account Transactions $13.27 per barrel in 1977 compared with $12.14 per barrel in 1976—resulting from OPEC price Between 1976 and 1977 net receipts from increases in January and July (Table 7). non-trade current-account transactions in Approximately half of the growth in the creased by $3 billion (Table 8). Virtually all of quantity of imported oil is estimated to be the the increase resulted from larger net receipts result of a rise in demand that would normally from investment income and from a rise in be associated with the increase in real GNP military sales. that occurred during the year. Unusually se Net investment income receipts increased vere weather accounted for an estimated 30 $2 billion to total $12 billion in 1977. Returns per cent of the growth: this involved both the on U.S. direct investments abroad—apart substitution of oil for hydropower in generat from undistributed profits—amounted to ing electricity occasioned by the drought in the nearly $13 billion, an increase of 15 per cent West and the increase in oil usage in the first from 1976 levels. About half of the increase quarter of 1977 because of the unusually cold was associated with higher returns from the weather. The remainder of the increase in oil foreign affiliates of U.S. manufacturing com imports is attributable, about equally, to two panies and another 30 per cent from foreign additional factors—substitution of oil for natu affiliates of U.S. petroleum companies. Part of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
262 Federal Reserve Bulletin □ April 1978 8. Non-trade current-account transactions Unilateral transfers changed only mar Billions of dollars ginally in 1977. U.S. Government grants (non military), at $2.8 billion in 1977, were only Item 1976 1977 Change slightly less than in 1976. The level of remit Non-trade current-account transactions, net ........................ 7.9 11.0 * 3.1 tances and pensions was virtually unchanged. Unilateral transfers .......................... -5.0 -4.8 .2 U.S. Govt, grants (nonmilitary) . -3.1 -2.8 .3 Remittances and pensions .......... -1.9 -2.0 -.1 CAPITAL FLOWS Net military and service transactions ............................... 12.9 15.8 2.9 Total receipts .................. 48.6 56.1 7.5 As the U.S. current account swung to a record Total payments ...................... -35.7 --40.3 -4.6 deficit, there was a corresponding shift of the Investment income, net .............. 9.8 11.9 2.1 Direct investments, net............ 9.8 11.5 1.7 capital account to large inflows. Indeed, re (from U.S. investments corded private and official capital flows for abroad) ................................ (11.1) (12.8) (1.6) Other, net .................................. * .4 .4 1977 shifted by more than $30 billion—from a Military transactions .................... .4 1.4 1.0 net outflow of $8 billion in 1976 to a net inflow Sales .......................................... 5.2 7.1 1.9 Expenditures .............................. -4.8 -5.6 -.8 of $23 billion in 1977. Partly offsetting this swing in recorded capital was a $13 billion Travel, net (including passenger fares) ............................................ -2.4 -2.7 -.3 shift in unrecorded transactions to a small Transportation, net ...................... .2 -.4 -.6 Fees and royalties, net ................ 3.9 4.2 .3 outflow in 1977 from a sizable inflow in 1976 Other services, net ...................... 1.0 1.4 .4 (Table 9). * Less than $50 million. Note—Details may not add to totals because of rounding. Data are from U.S. Dept, of Commerce, Bureau of Economic Analysis. Private Capital Flows While there was an over-all recorded capital the rise in dividends received from these in inflow during 1977, there was a sharp differ vestments during 1977 reflected accelerated ence between private and official capital repatriation of earnings in advance of a change in German tax law. Returns on foreign direct flows. Whereas there was a $37 billion net increase (a capital inflow) of foreign official investment in the United States, $1 billion in 1977, were little changed from a year earlier. asset holdings in the United States in 1977, Net returns on other types of foreign in there was a $10 billion recorded net outflow of private capital (Table 9). The increase of for vestments were about equal to amounts in eign official assets was accounted for by large 1976, as a $2 billion increase in receipts of in intervention purchases of dollars. The re come from U.S. claims on foreigners was corded outflow of private capital and also probnearly offset by a %\Vi billion rise in payments to foreigners resulting from rising U.S. liabili 9. U.S. capital-account summary ties and higher interest rates. Billions of dollars, outflow ( - ) Foreign sales of U.S. military goods and services exceeded U.S. military expenditures Item 1976 1977 Change abroad by $1 Vi billion in 1977, up from %Vi Private and official capital billion of net receipts in 1976. Transfers under flows, net .................................... -8.4 23.2 31.6 sales contracts of U.S. military agencies in Foreign official assets (increase, +) ...................... 17.9 37.4 19.5 creased strongly in 1977 to $7 billion owing to Reserve assets .......................... 13.0 35.5 22.5 a sharp rise in deliveries of aircraft, military Other assets............................... 4.9 1.9 -3.0 U.S. reserve assets equipment, and construction services to Mid (increase, -) .......................... -2.5 -.2 2.3 Other U.S. Govt, assets, net dle Eastern countries. U.S. military expendi (increase, -) .............. -4.2 -3.7 .5 tures abroad, at $5Vi billion, were up slightly Private capital flows, net (outflow, -) .......................... -19.6 -10.3 9.3 from a year earlier, reflecting not only higher Statistical discrepancy personnel payments but also a rise in pay 9.9 -3.0 -12.9 ments to foreign nationals for construction Note—Details may not add to totals because of rounding. Data services. are from U.S. Dept, of Commerce, Bureau of Economic Analysis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
U.S. International Transactions 263 10. Private capital transactions ties. All of the decline in new bond flotations Billions of dollars, outflow (-) was accounted for by a reduction in new Canadian bond flotations in the United States Item 1976 1977 Change reflecting both Quebec’s difficulty in re Private capital transactions ............. -19.6 -10.3 9.3 establishing itself in the U.S. market— Reported by banks and securities Quebec-related borrowings here dropped by -14.6 -6.7 7.9 Bank-reported capital, net -9.9 -4.9 5.0 more than $1 billion from 1976—and the re Securities: U.S. net purchases (-) of duction in Canadian interest rates relative to foreign securities ------- -8.7 -5.4 3.3 (new bond issues) ............ (-10.0) (-6.8) (3-0 U.S. interest rates. Foreign net purchases (+) of U.S. Treasury securities 2.8 .6 -2.2 Foreign net purchases (+) of U.S. corporate securities . 1.3 2.9 1.6 Foreign Official Assets Corporate financial transactions.. -5.0 -3.6 1.4 in the U nited States Direct investment: U.S. direct investment (-) - 4 In 1977 there was a very large, $37 billion, in abroad, net ........................ -4.6 -5 0 Foreign direct investment (+) crease in foreign official holdings in the United in U.S., net,........................ 2.2 1.5 —,7 Other corporate transactions, States (Table 11). Non-OPEC countries as a net ............................................ -2.6 -.1 2.5 Statistical discrepancy ...................... 9.9 -3.0 -12.9 group increased their official holdings of bank ing assets and security holdings in the United Note—Details may not add to totals because of rounding. Data are from U.S. Dept, of Commerce, Bureau of Economic Analysis. States by $31 billion—a capital inflow— following an increase of $9 billion in 1976. A $16 billion increase in official holdings during ably a large part of the $3 billion outflow in the the first three quarters of 1977 was associated statistical discrepancy (unrecorded trans largely with intervention purchases of dollars actions) may well have reflected some in by the United Kingdom and Italy to rebuild creased borrowing of dollars and adjustments their international reserves and to avoid an in the timing of payments for trade and service abrupt appreciation of their currencies. In the transactions as international investors were fourth quarter most of the $15 billion increase faced with the prospect of a depreciating dollar. in the reserve assets of non-OPEC countries The net outflow of bank-reported private resulted from heavy intervention purchases of capital in 1977 amounted to $5 billion, which dollars by the central banks of Germany, was less than in 1976 (Table 10). The slowing Japan, and Switzerland. of bank-reported capital flows, particularly pronounced in the first half of 1977, reflected two factors: (1) reduced requirements for bal 11. Changes in foreign official assets in the ance of payments financing of several of the United States major developing countries and (2) interest Billions of dollars, outflow (—) rate developments that induced banks to rely Item 1976 1977 Change more heavily on raising funds in overseas Changes in foreign official assets money markets, rather than in the U.S. in the United States.................... 17.9 37.4 19.5 OPEC ............................................. 9.3 6.8 -2.5 domestic money market. The increase in Other foreign official bank-reported net capital outflows in the sec institutions.................................. 8.6 30.7 22.1 ond half of 1977 probably reflected borrowing Note—Data are from U.S. Dept, of Commerce, Bureau of Economic Analysis. of dollars by banks’ commercial customers to reduce their exposure to a possible deprecia Foreign central banks (excluding those of tion of the dollar—that is, to reduce their net the OPEC countries) invested $27 billion of dollar assets. their increased dollar holdings in Treasury New bond flotations by foreigners totaled $7 securities during 1977; their purchases ac billion in 1977, some $3 billion less than in counted for about 70 per cent of the increase 1976. Purchases of new bond issues account of publicly held Treasury securities in that for most U.S. transactions in foreign securi year. While the large-scale official investment Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
264 Federal Reserve Bulletin □ April 1978 in Treasury securities tended to depress yields OPEC countries increased their official on Treasury securities relative to other holdings in the United States by $7 billion last dollar-denominated securities for a while— year, $2Vi billion less than in 1976. This lower thus reducing the cost of the financing of the rate of accumulation reflected a decline in the U.S. public debt—the linkage of the Treasury rate of new investment in the United States by securities market to other securities markets is the low-absorbing OPEC countries, as well as sufficiently well developed that the effect of the continuing rundown in holdings in the large official purchases on relative yields are United States by the other OPEC coun dispersed within a relatively short time. tries. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
265 Monetary Policy and Open Market Operations in 1 9 7 7 This article is adapted from a report submitted The sustained expansion of aggregate de to the Federal Open Market Committee by mand gave rise to stronger demands for money Alan R. Holmes, Manager of the System Open than had occurred earlier in the recovery. In Market Account and Executive Vice President 1977 the Federal Reserve System moved from of the Federal Reserve Bank of New York, and a position of encouraging to one of moderating by Peter D. Sternlight, Deputy Manager for the pace of monetary expansion. The System Domestic Operations of the System Open responded to several spurts in monetary Market Account and Senior Vice President of growth by limiting the availability of bank the New York Bank. reserves in relation to demand, so that short Sheila Tschinkel, Adviser, Securities De term interest rates rose and exerted a restraint partment of the New York Bank, was primarily on monetary expansion. responsible for preparation of the report. Over the year, growth of M-l—demand Ann-Marie Meulendyke, Chief, Securities deposits plus currency in the hands of the Analysis Division, contributed to its develop public—came to 7.8 per cent, compared with ment, and members of her staff, Nancy 5.7 per cent in 1976,2 and was above the top of Marks, Connie Raffaele, Anne Rowane, and the range for longer-term growth that the Robert Van Wicklen, prepared the data used. Federal Open Market Committee (FOMC) had projected earlier. Still, the System’s response Federal Reserve policy in 1977 worked to to this expansion had an effect over time, and encourage a healthy expansion in economic growth of M-l slowed somewhat toward the activity without a renewed burst of inflation. end of 1977 and in the opening months of 1978. Over the year the economy experienced sub Rising interest rates also dampened the expan stantial real growth at a rate that was some sion of time and savings deposits subject to what above its long-run potential. The expan interest rate ceilings. Hence growth of the sion contributed to a significant reduction in broader monetary measures—M-2 and M-3— the unemployment rate, from 7.8 per cent in remained within or only slightly above the December 1976 to 6.4 per cent a year later, upper ends of earlier anticipated ranges and even though the labor force continued to in was at a slower pace than in 1976. M-2 —which crease rapidly. Consumer demand remained adds time and savings deposits at commercial impressively strong, and a pick-up in residen banks to M-l—increased by 9.8 per cent, less tial construction provided further impetus to than the 10.9 per cent of the year before, while the economy. On the negative side, inflation averaged about 6.5 per cent, according to the consumer price index, although there was 2Data in the body of the report include the effects of seasonal and benchmark revisions on March 23, 1978, some slowing in the second half of the year.1 which had the effect of lifting the annual growth for M-l in Gains were uneven in the various domestic 1977 from 7.4 per cent reported initially and M-2 and M-3 sectors, and the U.S. trade balance with other growth from 9.6 and 11.6 per cent reported previously. The revisions also raised the first- and fourth-quarter countries showed a record deficit. growth rates and lowered the second- and thirdquarter growth rates. The chronological section of the report makes use of the data as published at the time, since Federal Reserve decisions were based on them. Growth rates are based on daily average levels in the xData on economic activity and prices reflect informa fourth quarter of 1977, compared with the fourth quarter tion available as of March 10, 1978. of 1976. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
266 Federal Reserve Bulletin □ April 1978 M-3—which adds deposits at thrift institutions tary authorities. Altogether, these over to M-2—increased by 11.7 per cent, down allotments totaled $10.7 billion. Finally, $9.4 from the 12.8 per cent of 1976. billion of special Treasury issues (or interest A record volume of funds was available in arbitrage securities) was sold to States and financial markets during 1977 to meet ex municipalities in conjunction with their ad panded borrowing by all economic sectors. vance refunding of outstanding debt that car Funds raised in credit markets by nonfinancial ried high interest rates. sectors swelled to an all-time peak of $336 Because this expanded regularization of billion, or nearly 18 per cent of nominal gross Treasury coupon offerings enabled market national product (GNP). Businesses borrowed participants to anticipate such financings, the heavily at banks and in the open market, after distribution of these new issues usually pro repaying short-term debt in 1975 and borrow ceeded smoothly. As in 1976, the sale of ing very little in 1976. Business bond flota intermediate- and long-term issues led to an tions, at over $24 billion, remained nearly as increase in the average maturity of the pri high as in the period of debt restructuring vately held Government debt. Between 1965 earlier in the recovery. Households increased and 1975 the average maturity had declined. instalment debt sharply, reflecting substantial With the Federal Reserve seeking to moder purchases of durable goods. ate growth in the money and credit aggregates, The unprecedented level of single-family the heavy demands for credit that developed homebuilding led to strong growth of mortgage in 1977 tended to exert upward pressure on credit, as did increased commercial and school interest rates. The yield curve became flatter, construction. State and local government as is typical in an economic expansion, even financing in the bond market set a record— though borrowing was proportionally heavier $45.1 billion. Much of this latter total reflected in longer-term issues than in previous eco pre-refunding of debt issued a few years before nomic expansions. Short-term rates trended when interest rates had been higher. higher over most of the year—posting net Financing by the Federal Government re advances of about 2 percentage points. Yields ceded further in 1977 from the high 1975 total, on intermediate-term securities rose 65 to 100 but borrowing needs remained relatively large basis points in January and early February but for the third year of an economic expansion. then showed little net change on 5- to Treasury net cash borrowing came to nearly 10-year maturities until the closing months of $57 billion in 1977, and virtually all of this was 1977, when they moved up by another 40 basis obtained through offerings of notes and bonds. points. Yields on long-term securities followed In January the Treasury sold the final new a pattern similar to those on intermediate-term issue in its cycle of 24 monthly auctions issues and rose about 70 basis points for the of 2-year notes. Then in most subsequent year. months, as outstanding 2-year notes came due Yields in the note and bond markets were for rollover, it added to the size of the opera volatile at times, as participants responded to tion to raise marginal amounts of new money. uncertainties about the outlook for the eco The Treasury also sold new notes with nomy and inflation. These worries—and the maturities of about 4 years in a new cycle of caution they generated—were also reflected in quarterly auctions, and alternated between prices of equity issues, which fell over the 5-year notes and 15-year bonds in a second year. Prices for tax-exempt securities, in con quarterly cycle. Additional cash was obtained trast, rose throughout the year, with the in the midquarter refinancings, which gen largest gains occurring on less than top-rated erally included short- and intermediate-term issues as the earlier market concerns gener notes and a long-term bond. In many of its ated by the New York City financial crisis of financings, additional new money was raised 1975 receded further into the past. Demands by marketing extra allotments of new coupon from financial corporations and individuals— securities to foreign central banks and mone including in the latter case buying reflected Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Domestic Open Market Operations 267 through bond funds—also tended to M-3. By 1977, the influence of regulatory strengthen the market for lesser-rated issues. actions that had encouraged transfers from demand into savings and thrift deposits during 1975 and 1976 had begun to wane, and the MONETARY POLICY IN 1977 higher levels of interest rates that developed on short-term market instruments as the year Long-Term Ranges for Aggregates progressed made these instruments increas The Federal Open Market Committee ingly attractive relative to deposits. (FOMC) continued gradually to reduce its Downward adjustment in the range for M-1 12-month ranges for monetary growth during was more modest. In 1975 and 1976, growth of 1977, in order to show some progress toward M-1 had been low relative to growth of nomi attainment of the slower expansion in money nal GNP because changes in financial and cash needed to dampen inflation and inflationary management technologies had permitted the expectations over the longer run. While press velocity of money to rise more than had been ing for growth rates compatible with price the case in previous economic expansions. In stability over a number of years, the Commit 1977, however, growth of M-1 apparently re tee was, nevertheless, able to foster current established a relationship to GNP closer to the financial conditions conducive to growth in one that had prevailed more generally prior real income and employment. Once each quar to 1975. In these circumstances, the FOMC ter the Committee reviewed its 12-month elected to make less downward adjustment in growth ranges for the monetary and credit the growth range for M-1 than for M-2 aggregates and set new ranges for the period and M-3. ahead, starting from the average level in the quarter just ended. Instructions to In setting these 12-month growth ranges, the the Account Manager FOMC sought to take account of the likely effects of market interest rate levels, as well as In the implementation of monetary policy be financial and technological changes, on the tween FOMC meetings, the Committee’s public’s demands for different types of de focus continued to be on 2-month growth positary assets. For this reason, the Commit ranges for M-1 and M-2. After each monthly tee made the largest downward adjustments in meeting, the FOMC supplied the Trading ranges for the broader aggregates—M-2 and Desk with ranges of tolerance for these FOMC’s Annual Growth Ranges for Monetary and Credit Aggregates Seasonally adjusted annual percentage rates M-1 M-2 M-3 Month Period established Credit proxy Range Actual Range Actual Range Actual Mar. 1975-Mar. 1976 .... Apr. 1975 5-lVi 5.0 m -\m 9.6 10-12 12.3 6Vi-9Vi June 1975-June 1976 .... June 1975 5-lVi 4.2 m -\m 8.7 10-12 11.2 6Vi-9Vi 1975-Q2-1976-Q2 July 1975 5-lVi 5.2 9.5 10-12 12.0 6V1-9V2. 1975-Q3-1976-Q3 Oct. 1975 5-7Vi 4.6 lYi-W/i 9.3 9-12 11.5 6-9 1975-Q4-1976-Q4 Jan. 1976 AVi-lVi 5.7 1Vi-\Wi 10.9 9-12 12.8 6-9 1976-Q1—1977-Q1 Apr. 1976 AVi-1 6.3 7^-10 10.9 9-12 12.8 6-9 1976-Q2-1977-Q2 ........ July 1976 AYi-1 6.6 IVi-Wi 10.7 9-11 12.4 5-8 1976-Q3-1977-Q3 Nov. 1976 4V4-6V4 7.8 7VS-10 11.0 9-11 ^ 12.7 5-8 1976-Q4-1977-Q4 Jan. 1977 AVi-Wi 7.8 7-10 9.8 m-UVi 11.7 7-10 1977-Q 1-1978-Q1 Apr. 1977 AYi-kVi 7-9 Vi m -\\ 7-10 Bank credit 1977-Q2-1978-Q2 July 1977 4-Wi i-m 8^-11 7-10 1977-Q3-1978-Q3 .......... Oct. 1977 4-6 6Vi-9 m -\m 7-10 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
268 Federal Reserve Bulletin □ April 1978 aggregates—defined as the average of season change markets had become a matter of con ally adjusted annual growth rates for the cern. month in which the meeting was just held and the month that followed. The FOMC also Implementing Policy indicated how the Manager was to vary his objective for the Federal funds rate if incom Following his instructions, the Manager re ing data caused revisions in the projected sponded to the strength of the monetary behavior of M-l and M-2 relative to their aggregates at several points during the year, ranges. In comparing projected behavior seeking an increase in the Federal funds rate. against the ranges of tolerance, the Desk was During the first 3 months, the funds rate was expected to weigh M-l and M-2 about equally. relatively steady, starting around 45/s per cent It is the Manager’s highly visible efforts to as the year began and then toward 4% per cent adjust the Federal funds rate as new data on by mid-April. Between the April and May the monetary aggregates become available FOMC meeting M-l continued to grow follow that trigger reactions at financial institutions ing a large April bulge, reaching an expansion and in financial markets that ultimately affect rate above the Committee’s range, and the the economy. Manager fostered a 50-basis-point rise in the In 1977 the Committee often established funds rate to 5Va per cent.3 A modest rise in 2-month tolerance ranges for the aggregates the funds rate to 53/s per cent then developed that had midpoints below the growth actually between May and June. Additional strong expected for them at the time of its meeting, money supply growth in early July was not recognizing that if strong expansion in the reversed in succeeding weeks to the degree aggregates persisted this would call for a expected, and the funds rate was allowed to further limitation on reserve availability. The rise to 6 per cent in the weeks just prior to the Committee also lowered the bottom of the August Committee meeting.4 A more gradual aggregate ranges, thus reducing the likely need rise brought the funds rate to 6V2 per cent by for a temporary drop in the Federal funds rate. mid-October because estimates of the aggre The Committee’s ranges for the Federal gates had tended to work toward the high side funds rate were raised as the year progressed. of the ranges specified at the August and However, at four meetings the Committee September FOMC meetings. At the end of expressed a preference for the Manager to October, the Desk briefly sought a slight keep money market conditions unchanged, further rise in the funds rate because it ap unless the aggregates were approaching or peared that a bulge in the aggregates during exceeding the end points of their ranges. This the month would not be worked down sub money market emphasis was adopted in June sequently and that growth of the aggregates and October, immediately after there had been would be near or beyond the upper limits of substantial increases in the funds rate. the specified ranges. In early November, Then, in November and December, the however, projections were revised lower, and Committee again elected to stress money mar the Desk returned to the 6V2 per cent funds ket stability when members found it particu rate objective, which it then retained over the larly difficult to judge the significance of the rest of the year. short-run behavior of the aggregates. At times when financial markets were under strain, the 3The Committee raised the upper limit of the range for FOMC instructed the Manager to take market the Federal funds rate to 5Vi from 5lA per cent, with the reactions into account in implementing its understanding that the Manager would use the additional leeway only if new data, becoming available before the objectives. In December, the Committee also next meeting, indicated significant further strengthening instructed the Desk to consider developments in the aggregates. Such strengthening did not develop in in international markets in framing its re that period, and the additional leeway did not need to be used. sponse to the aggregates, since, the weakness 4On August 5, the top of the range for the Federal funds of the dollar and the unsettlement in the ex rate was raised to 6 per cent from 53A per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Domestic Open Market Operations 269 Financial markets remained acutely sensi foreign and international accounts also af tive to the short-run behavior of M-l through fected System operations during the year. out the year. Large increases in M-l— The high variability of Treasury cash bal sometimes anticipated and sometimes not— ances continued to cause huge week-to-week usually precipitated upward adjustments in changes in reserve availability, which needed short- and even long-term interest rates. Initial to be offset through open market operations. market reactions were typically overdone and, In 1977 the average change in the weekly subsequently at least, partially reversed. As a balance at the Federal Reserve was $2.1 bil result, even by early October, yields on inter lion. This was similar to the experience in 1976 mediate issues due after about 5 years and on but was high compared with average swings of long-term bonds were little different from the $0.5 billion in 1973, before the Treasury insti higher levels reached in early February, al tuted its policy of keeping most of its balances though fluctuations between February and at the Federal Reserve. early October were often substantial. Over the The Trading Desk was generally successful longer run, the System’s willingness to let in offsetting these large variations, though credit demands raise interest rates and the difficulties did arise following major tax re moderation in the pace of the economic ex ceipts in April, September, and to a lesser pansion helped to bolster confidence that the extent, December. On these occasions, the recovery could proceed without generating the Desk was unable to make repurchase surging inflationary pressures seen earlier in agreements (Rp’s) in sufficient volume to the 1970’s. offset the rise in Treasury balances, primarily because available supplies of securities were low given market expectations of further in Open Market Operations creases in interest rates. The Treasury at those System open market operations in 1977 limited times helped alleviate the reserve shortages by the growth of nonborrowed reserves to around temporarily redepositing funds in tax and 3Vi per cent. As the Federal funds rate rose loan accounts at commercial banks. above the discount rate, member bank bor On October 28, 1977, President Carter rowing increased. In 1977, bank use of the signed into law a bill that provides the Treas discount window proved less predictable than ury with the authority to invest its cash in similar periods in the past. In some weeks, balances with commercial banks. Those banks banks borrowed large amounts on Friday, that choose to participate will receive funds which resulted in unanticipated reserve exces flowing into their tax and loan accounts that ses after the weekend. At other times, borrow the Treasury does not immediately need for ing would be light on Friday and reserve payment purposes. They may also receive scarcities would develop by the end of the occasional redeposits from balances at the statement week. Borrowing also escalated Federal Reserve. The banks will pay interest more rapidly in response to Desk moves to on these investment funds. It is hoped that the limit reserve growth, notably in August and in new procedures, when implemented, will en October. Increases in the discount rate from able the Treasury to maintain reasonably 5lA to 5% per cent in late August and to 6 per steady balances at the Federal Reserve, cent toward the end of October reduced use of thereby reducing the need for frequent and the discount window significantly. massive intervention in the open market by Daily open market operations continued to the Desk. be shaped by large fluctuations in factors that Starting in May 1977, the Desk began to affect bank reserves, principally the Treas meet all temporary investment orders from ury’s balances at Reserve Banks, float, and foreign central banks by making System “as of” adjustments to bank reserve posi matched sale-purchase transactions with tions. A change in the procedures for arrang them. This action, undertaken after Commit ing short-term transactions on behalf of tee discussion, followed an Internal Revenue Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
270 Federal Reserve Bulletin □ April 1978 Service (IRS) ruling that indicated that income dealers were making such reports informally, earned on Rp’s by foreign official accounts with the intent of becoming more active in the might be taxable if the transactions were ar market and being added to the official report ranged in the market but that the income was ing list. probably not taxable if the Rp’s were made Several factors have led to this growth. The with an entity of the Federal Reserve System. sustained expansion in Treasury coupon offer For the rest of the year, the Desk essentially ings prompted several investment banking treated overnight matched sale-purchase firms to enter the market, so they could pro transactions with foreign accounts as a market vide alternative investment outlets to their factor, which it took into account along with customers. Increased emphasis on perform the anticipated impacts arising from variations ance by portfolio managers contributed to far in other factors, in addressing reserve avail greater buying and selling activity, particularly ability.5 when prices of debt securities were rising Securities held outright by the System Open during 1975 and 1976. Disenchantment with Market Account increased by about $10 billion the equities markets also contributed to in 1977, nearly $3.5 billion more than in the greater interest in fixed-income securities. previous year. Most of the increase in growth The Government securities market has be resulted from larger net purchases of Treasury come more efficient and competitive and more bills—$4.4 billion compared with $863 million able to handle large Treasury financings and in the previous year. Purchases of coupon Federal Reserve operations smoothly. The issues—at $4.7 billion—were about $500 mil linkages between it and other debt markets lion smaller than in 1976, and net acquisitions have strengthened. Spreads between bid and of agency securities—at $1.2 billion—were offer prices have narrowed significantly for $300 million larger. In March 1977, the FOMC actively traded Treasury issues, and the li voted to discontinue outright purchases of quidity of coupon securities—the ability to be bankers acceptances under ordinary circum converted into cash more quickly than other stances, but it continued to authorize Rp’s assets of similar maturity—has been en against acceptances. Outright holdings of ac hanced. Technological development, involv ceptances, which totaled $196 million at the ing electronic communications, has led to a start of the year, had all matured by the end of broader and more rapid dissemination of October. prices and has also contributed to the narrow ing of spreads. The rapid expansion in the market has not Trading Relationships with been free of disadvantages, however. To many Government Securities Dealers dealers the narrowing of spreads has reduced In the past few years, there had been a sub profit opportunities significantly, leaving posi stantial increase in the number of Government tion management as a more important source securities dealers that have had a trading rela of potential gain. At the same time, the expan tionship with the Desk. One of the steps in the sion in the market seems to have made it more establishment of a trading relationship with the difficult for dealers to perceive actual or po Federal Reserve is inclusion on the list of tential market supplies of issues and thus to dealers formally reporting their holdings and act as buffers for the ebb and flow in customer activity to the Federal Reserve. At the end of demands. Daily activity declined somewhat 1974, 27 dealers reported activity daily to the over 1977, and prices often moved signifi Federal Reserve, while 37 dealers were on the cantly in limited trading as participants reporting list in February 1978. Several other seemed less willing to face the potential size of buy and sell orders. Thus, while growth of 5In late 1977, the IRS determined that income received activity and the number of participants should by foreign official accounts from repurchase transactions work to enhance the depth and resiliency of with the System Account or with the Federal Reserve Bank of New York was not subject to Federal income tax. the market, the improvement in this regard Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Domestic Open Market Operations 271 may not have been so much as thought earlier. the short-run behavior of the monetary aggre Profits were poor in 1977. gates reflects, of course, the System’s tech Because the expansion of the market was niques of operation. Market observers care rapid and the availability of finance plentiful, fully follow evidence on the economy’s not all participants gave adequate attention to prospective behavior to reach a judgment the risks inherent in such activity, particularly about the likely course of interest rates over with regard to the implicit extension of credit the long run. But for the operations of Govern that arises in many transactions. There have ment securities dealers and other short-term been some painful experiences as a result. In holders of securities, a correct forecast of the recent years, the Federal Reserve has in timing of changes in interest rates is critical creased its surveillance of market activity. In to profitability. 1977 a number of on-site visits were made to In 1977 interest rates evidenced substantial dealer firms to evaluate market practices and short-run fluctuations, to a considerable ex policies, as well as to check on the accuracy of tent because market participants found it dif dealers’ statistical reports. Further visits are ficult to identify underlying tendencies in the planned for 1978. inherently volatile weekly data on the mone The Federal Reserve has sought to encour tary aggregates. Money supply statistics tend age free entry into the market. At the same to be erratic over periods of a week—or even a time, it has been cognizant of the need to month—partly because the current knowledge evaluate each firm’s activity—not just to as of seasonal adjustment techniques does not sess its market practices but also to evaluate permit the effective separation of recurring the services it provides to the Federal Reserve patterns of fluctuation from short-run noise and the Treasury. Much of the expansion in and underlying trends in the data. The mar trading activity in recent years has repre ket’s resulting difficulty in anticipating mone sented trading among dealers—some directly, tary behavior thus tends to be reflected in but mostly through brokers. Thus, it is not considerable short-run volatility of interest always clear that expanded activity enhances rates. the distributive services of the market. For In these circumstances, there is much to be this reason, when evaluating an individual said for the System’s using wider short-run dealer’s performance, the Manager has tended tolerance ranges for M-l—the most volatile of to place increasing emphasis on that firm’s the aggregate measures—as was done over trading with customers and not merely on its part of the year. Alternatively, ranges might total market activity. be used that rely upon an averaging technique that is not as sensitive to incoming short-run data. If the System’s time horizon were so Observations extended, this would soon be perceived and In recent years, the System’s procedures for there might be less emphasis placed on volatile establishing and pursuing growth ranges for data that frequently contain little information the monetary aggregates have become more about trends and sometimes even mislead. widely understood by the public and by partic While the behavior of M-l still bulks large in ipants in financial markets. As a result, market shaping the thrust of System open market participants have tried to anticipate move operations over the short run, the relative ments in the monetary aggregates that might emphasis on M-l has nevertheless been re trigger shifts in the System’s weekly objective duced in recent years. Changes in the financial for the Federal funds rate. They have been structure and payments mechanism and in the acutely sensitive to the weekly publication of pattern of regulatory constraints suggest that money supply data and to any nuances they observed holdings of demand deposits—the perceive in the Desk’s conduct of daily open major component of M-l—may not now be market operations. serving the same economic purpose as in The preoccupation of market observers with earlier years. Under present arrangements, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
272 Federal Reserve Bulletin □ April 1978 demand deposits may now be a rather incom In specifying its instructions to the Manager plete measure of both transactions demands during this period, the Committee was con for money and of money as a store of liquidity. ditioned by expectations that the demand for For example, the availability of investments, money would strengthen along with economic such as Rp’s, to large economic units and the activity. The FOMC moved cautiously in mod growing possibilities for smaller economic ifying its policy stance, however, because of units to use savings deposits for transactions the sharp increases in market interest rates purposes suggest that the narrow money that suddenly developed after the turn of the supply—as currently defined—may now be year. In January, the FOMC instructed the substantially less important than in the past. In Desk to seek a slight upward adjustment in the these changing circumstances, it thus becomes Federal funds rate from around 45/s per cent to necessary to give added emphasis to the the 45/s to 4% per cent area, within the same broader measures of money when formulating range of 4Vi to 5 per cent adopted in Decem and implementing policy. ber. It also established tolerance ranges for At the same time, however, it must be M-l and M-2 that were on the low side of the recognized that the broader measures of possibilities discussed. money possess certain drawbacks of their own When growth of the aggregates temporarily as operating ranges for open market policy. faltered in February, the FOMC established For example, many of the time deposits in tolerance ranges that surrounded the growth cluded in M-2 and M-3 are certificate ac expected at the time and many members ex counts, with maturities of several years and pressed a preference for the Federal funds rate heavy penalties for early withdrawal. Ac to remain steady. By the time of the March counts of this type are not too well adapted to meeting, monetary expansion appeared to be either the transactions or the liquidity pur picking up and tolerance ranges for the aggre poses of money. In addition, time and savings gates were lowered relative to expected deposits subject to statutory interest rate ceil growth; the upper end of the range set for the ings can develop a rather erratic growth per Federal funds rate was increased by lA of a formance when yields on competitive market percentage point to 5lA per cent. securities fluctuate around those ceilings. The Desk sought Federal funds trading within the area of 4% to 43A per cent after the January meeting though the slight change in its OPEN MARKET OPERATIONS IN objective was scarcely perceptible. After hav 1977 ing been lowered during the final months of 1976, the funds rate had leveled out at 45/s per January to Mid-April cent by the year-end. By mid-January the Early in 1977, FOMC members were generally Desk had become a bit more tolerant of funds anticipating a strengthening of the economy. trading slightly above this level than below, As the first quarter evolved, a vigorous expan since growth of M-l and M-2, taken together, sion did develop. With the restraints of severe had edged the high side of the specifications winter weather and fuel shortages receding, it adopted in December. Daily operations during seemed likely that economic growth would January were conditioned to a degree by the accelerate further in the second quarter and unsettled state of the Government securities then remain relatively strong over the rest of market. Between the January and February the year. On the other hand, signs that the rate meetings, the behavior of the aggregates gave of price inflation was accelerating were also no cause for the Manager to modify his ap evident, and participants in financial markets proach to reserve provision. In the weeks were expressing concern that the administra leading up to the March meeting, estimates tion’s fiscal proposals might be overly stimula were revised lower but both M-1 and M-2 were tive. again reasonably within their ranges. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Domestic Open Market Operations 273 Securities prices tumbled dramatically just on 1- to 10-year issues moving up 10 to 15 after the start of the year. Dealers in Govern basis points between early February and ment securities had increased inventories sub mid-March. stantially as 1976 drew to a close, anticipating Monetary growth accelerated significantly that the Federal funds rate would move a little in April, and data available shortly before the lower and that banks and other investors FOMC meeting indicated that this bulge was would resume their purchases after a seasonal not receding. It appeared that growth of M-1 lull. But the lower funds rate and the expected would exceed its March-April range, while demand failed to materialize, and in fact, M-2 would be in the upper part of its range. banks liquidated issues for a while, given the The Desk—which had aimed for a Federal emergence of heavier demand for credit. funds rate in the 4% to 4% per cent area— Interest rates climbed across the maturity adjusted its weekly objective for the Federal spectrum amid the realization that the Federal funds rate to 4% per cent. The extent of the funds rate was not likely to decline further and Desk’s response was tempered somewhat be that more robust economic growth was likely cause of the proximity of the next FOMC to lead in time to a less accommodative mone meeting, and the change in the Desk’s objec tary policy. Concern over the size of prospec tive was barely perceptible, in part because tive Treasury deficits and of long-term financ market attention was focused elsewhere. ing by corporations and municipalities Market participants were preoccupied with deepened the pessimism in the market for the administration’s withdrawal of its pro coupon securities. Yields on intermediate- posed tax rebate program. The release of data term Treasury issues rose as much as 65 to 100 showing the unusually large increase in the basis points from the end of December to early narrowly defined money supply over the first February to around 7 per cent in the 5-year week of April—$5 billion—and the large rise in area, while yields on longer-term bonds in industrial production reported for March did creased about 50 basis points to around 7.80 little to temper the shift in market expectations per cent. Auction rates on 3- and 6-month bills toward the view that interest rates would rose by about 40 and 50 basis points to 4.72 recede. Dealers rebuilt positions in coupon and 5.01 per cent, respectively. The sharp issues significantly, anticipating that Treasury price declines imposed very large losses on the financing needs would be reduced. In the days dealer community and in some cases equaled leading up to the April FOMC meeting, yields the profits earned in all of 1976, a rather good on intermediate-term issues fell about 20 to 30 year for dealer profitability. basis points, well below early February highs, The debt markets stabilized during Febru while those on bonds declined about 15 basis ary. Short-term rates moved slightly lower, as points. Rates on Treasury bills fell somewhat the funds rate held fairly steady and data on less. the aggregates showed modest growth. Just before the March FOMC meeting, 3- and 6-month bills were auctioned at 4.55 and 4.81 Mid-April to Mid-July per cent, respectively. Intermediate- and When the Committee met in April, estimates long-term rates fell for a few weeks but began showed that the performance of the economy to rise again, reflecting caution over the pros in the first quarter had been even stronger than pects for containing inflationary pressures in anticipated. Expansion over the next few the face of expanding business activity and quarters was still expected to be substantial credit demands. While dealers made substan even though fiscal programs seemed likely to tial reductions in their positions in coupon be less stimulative than thought earlier. The issues after the Treasury’s quarterly refunding unemployment rate had been moving lower in February, yield increases were far more amid rapid labor force growth. At the same modest than at the start of the year, with those time, however, the outlook for inflation was Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
274 Federal Reserve Bulletin □ April 1978 worrisome in view of upward pressure on food to exert pressure on the money market during prices and the prospects for an increase in the the latter part of April. The Desk encountered minimum wage. The administration was plan difficulty in offsetting these reserve drains, ning to present its energy program to the since dealers and other active market partici Congress the day after the meeting. Although pants had sharply reduced their securities po the need for an energy program was clear, its sitions in anticipation of higher interest rates. effects on business investment and other key The Treasury had helped to alleviate the re components of aggregate demand were dif serve scarcity by moderating calls on tax and ficult to appraise and uncertainties seemed loan accounts and, at one point, made a tem likely to intensify while the Congress deliber porary redeposit of its balances at commercial ated actual measures. banks. In financial markets, participants generally Since the Desk expected substantial reserve expected upward rate pressures to emerge as needs to persist, it announced late on April 27 the year unfolded. A seasonal Treasury that it would arrange 4- and 7-day Rp’s at the surplus was anticipated during the second start of the May 4 week. After the System had quarter, but private credit demands at banks concluded this operation and had bought bills and in the debt markets seemed likely to from foreign accounts, the money market continue their brisk expansion. Growth of M-l firmed from an opening rate of 4% per cent to and M-2 was very rapid in April, although the trading levels of 415/16 and 5 per cent. No unusual increase early in the month was ex further response from the Desk ensued that pected to be offset later. At the April meeting, day, and the market readily concluded that a the FOMC acknowledged that near-term mon further rise in the Federal funds rate was etary growth was likely to be rapid and set 6 to under way. This view was bolstered on April 10 per cent and 8 to 12 per cent growth ranges 28, when the weekly monetary statistics pub for M-l and M-2, respectively, for the lished late that day showed that the money April-May period. It also set a range of 4Vi to supply was remaining high. Funds opened at 5 5lA per cent for the Federal funds rate. With to 5Vi6 per cent on Friday morning, and the midpoint of the range a little higher than when they had risen to 5Vs per cent the Desk the 43A per cent rate sought just prior to the arranged over-the-weekend Rp’s. But trading meeting, the new range left some room for the moved up later on—to as high as 53A per Desk to respond to any tendency for rapid cent—and some banks turned to the discount money growth to persist. window. While initial estimates of the aggregates The Desk supplied additional reserves after showed April-May growth within the speci the weekend, as trading in Federal funds gen fied ranges, revisions toward the end of erally remained higher than 5 per cent. By the April placed M-l considerably above its range end of the May 4 statement period, the Desk and M-2 in the middle of its range. Taking both provided only modest resistance to this firm together, the Manager began in the final days ing since it began to appear that a further of April to seek a rise in the Federal funds rate increase in the objective for the funds rate to to 5 per cent, anticipating that a further firming around 5lA per cent would soon be appropri would ensue if additional data were to confirm ate. Over the week of May 4, the average the strength of money growth. It was decided effective Federal funds rate rose 33 basis to make this firming in the System’s stance points to 5.15 per cent. evident to the market promptly, since the Estimates of monetary growth in the follow Treasury was just about to begin its May ing week were still strong, and the Desk refunding, the terms of which were announced adopted a 5lA per cent objective. On May 6, on April 27. the FOMC raised the top of the range for the A sharp rise in the Treasury’s balance at Federal funds rate to 5Vi per cent but indicated Federal Reserve Banks and an increase in the that the additional leeway was to be used only required reserves of member banks had begun if later estimates for monetary growth were Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Domestic Open Market Operations 275 significantly higher. When this did not occur, second quarter. It set the tolerance range for the Desk maintained the 5lA per cent objective M-l toward the low side of the options dis until the May meeting. cussed. The FOMC narrowed the range for the The view that yields would decline, evident Federal funds rate to 5V4 to 53A per cent, in securities markets shortly before the April instructing the Manager to seek a rate of 5% meeting, faded quickly once participants per cent after the meeting. While most mem began to expect the System to move toward a bers preferred to avoid a decline in this rate, less stimulative posture, given the evidence of there was also concern that a further increase unusual acceleration in monetary growth and a of 50 to 60 basis points—the magnitude of the further quickening in the economy. By the rise between mid-April and mid-May—could time the Treasury conducted its refunding have more significant repercussions on finan auctions in early May, the market had largely cial markets. adjusted to the higher Federal funds rate and a In the days following the May meeting, the good bidding interest for new issbes developed Desk sought to establish a Federal funds rate from the higher rate levels. of around 53/s per cent. This represented only a The adjustment process was facilitated by slight increase, since market pressures had the fact that the Treasury was paying down already brought the rate to within a 5lA to 5% $0.5 billion of maturing debt and needed to sell per cent range. Expansion in the monetary only two issues, a 634-year note and additional aggregates slowed considerably over the Maybonds due in 2007. While dealers acquired June period, though they stayed well within sizable amounts of the new issues, they sold their ranges. them quickly—though at a loss—amid evi By the June meeting there was considerable dence of further Federal Reserve tightening. uncertainty about the outlook for growth in By the time of the May 17 meeting, they had a the near term. The early distribution of social net short position of $425 million in issues due security checks in July was likely to raise M-l after 1 year—$1.2 billion below the amount growth in that month, as it had in April. The held 4 weeks earlier—despite $1.8 billion of FOMC decided to give greater weight than new refunding issues taken into position. Over usual to money market conditions in the con the inter-meeting period, yields on 5- to 10- duct of open market operations over the year issues rose 30 basis points, while those on June-July period and retained a 5lA to 53A per longer maturities increased about 15 basis cent range for the funds rate. It instructed the points. Rates on Treasury bills rose some 50 Manager to maintain a Federal funds rate of basis points, but steady and sizable paydowns around 53/s per cent unless growth of the by the Treasury and a decline in dealer posi aggregates should approach or move beyond tions helped to alleviate the market’s adjust the limits of the ranges specified for the aggre ment to rising short-term rates. gates. In early July, growth did strengthen Information available at the May FOMC substantially but not enough to call for a Desk meeting continued to suggest a more vigorous response under the money market directive. economic expansion in the second quarter Thus, the Manager retained the 53/s per cent than had been anticipated earlier. This was objective until the July meeting. confirmed by the data reviewed at the June The securities markets reacted briefly but meeting, although at that time it began to significantly to the slight upward adjustment in appear that growth in subsequent quarters the Desk’s objective for the Federal funds rate might slow. While employment was continu in mid-May as participants expected the ing to expand, declines in the unemployment change to continue. When the funds rate soon rate had moderated. stabilized, interest rates across the maturity The Committee thought that relatively slow spectrum began to work steadily lower. Treas growth of the monetary aggregates over the ury bill rates fell about 5 basis points between May-June period would be appropriate after late May and the end of June to 4.98 per cent the exceptionally rapid expansion early in the and 5.19 per cent, respectively, for the 3- and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
276 Federal Reserve Bulletin □ April 1978 6-month issues. Yields on notes and bonds quickly and clearly in the days before a Treas declined about 10 to 20 basis points into early ury refunding. Therefore, in the last few days June and were relatively steady for some of July the Desk started to encourage a gradual weeks thereafter. For 5- and 10-year issues, rise in the Federal funds rate from 5% per cent for example, yields moved back to levels that to the 5% per cent top of its specified range. were not much different from those observed Since the market had already perceived the after their January rise. While Treasury rapid growth in the aggregates, the Desk’s financing needs had moderated, business de response was expected. On August 5 the mands for longer-term funds and mortgage- FOMC raised the upper bound for the funds related borrowings by financial intermediaries rate to 6 per cent, noting that the additional had risen to fill the gap. Tax-exempt debt leeway should be used gradually and cau offerings had continued at a record pace. tiously if further data still pointed to excessive monetary growth. When estimates of money Mid-July to Mid-October growth strengthened, the Desk sought a rate of 5% per cent for a few more days and then The economic situation appeared fairly strong raised the objective to 6 per cent. when the Committee met in July. While At its meetings in August and September the growth of real GNP in the second half of the FOMC moved the allowable range for the year appeared unlikely to be so rapid as in the Federal funds rate upward and funds traded at first, a gradual slowing was viewed as desir able in many respects. Actual developments about 6Vs per cent just before the September over the summer suggested that the economic meeting and 6V2 per cent from then until the October meeting, when estimates of growth of expansion had become more balanced, with the aggregates moved toward the top of the business capital investment gaining momen ranges specified at both meetings. tum for a while and needed inventory adjust The rise in the Federal funds rate that had ments being undertaken promptly. By Sep developed over the summer brought it to tember, it was clear that the expansion had levels that were significantly above the 5Vx per lost some of the exceptional vigor displayed cent discount rate. Member bank borrowing earlier in the year, although the continued rose sharply, especially in August, amid ex strength in final sales suggested that the slow pectations that the discount rate would soon ing might be temporary. be raised. Daily-average borrowing at the dis Growth of the monetary aggregates had count window rose to $1.7 billion late in moderated during the second quarter but was August from about $400 million in mid-July. high for the 3 months as a whole. Growth had The Desk found it difficult to anticipate how speeded up again in early July. At its July much banks would borrow from day to day. meeting the FOMC specified an aggregate Enlarged borrowings over weekends gener directive, with tolerance ranges for M-1 and ated reserve excesses toward the end of some M-2 that did not permit room for a continua statement periods, often placing the funds rate tion of the early-July bulge. The 5lA to 5% per under downward pressure. cent range for the Federal funds rate adopted The Board of Governors of the Federal at the two previous meetings was retained. Reserve System approved an increase in the Monetary data available shortly after the discount rate to 5% per cent at the end of July FOMC meeting suggested overly strong August. After an initial sudden drop in dis growth, and it later appeared that M-1 and M-2 count window use, borrowing behavior re were moving above the specified ranges.6 The turned to a more predictable pattern. When Manager again faced the need to indicate the the Federal funds rate rose again in September System’s response to strong monetary growth and into October, use of the discount window quickly expanded once more, from daily aver 6The Manager awaited further classification since data ages of less than $350 million to nearly $1.9 for the middle of July might have been distorted by the power blackout in New York. billion, and weekly fluctuations also grew. In Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Domestic Open Market Operations 277 late October, the discount rate was increased which had first emerged early in the summer to 6 per cent and borrowing receded again. after a year of relative stability, had begun to The securities markets anticipated—and at build up again near the end of September. The times overanticipated—the rise in interest dollar had fallen significantly despite substan rates that rapid growth in the aggregates would tial support operations by foreign central bring. Rates on money market instruments banks. The unemployment rate stayed near 7 adjusted higher, but other rates were less per cent, though after the year was over affected so that the yield curve continued to figures for August through November were flatten. By mid-September, rates on issues due revised lower and a decline to less than 6V2 per after 6 years were below levels observed in the cent was reported for December. The dollar spring. Investor demand for the Treasury weakened considerably further in exchange coupon issues sold in the August refunding markets in the final months of the year, and and for subsequent offerings of 2- and 4-year this became a matter of concern to the FOMC. notes was impressively strong. Dealers At its final three meetings of the year, the quickly moved to establish fairly large short Committee gave relatively more weight to positions after each note or bond auction, only money market conditions in the implementa to encounter sustained investor interest. tion of monetary policy. Financial flows tend During September, however, expectations to become more volatile toward the year-end, shifted again. Market participants feared that making it more difficult than usual to assess the aggregates could again bulge in early Oc the significance of short-run behavior of the tober, repeating the earlier quarterly patterns, aggregates. There was also uncertainty about and that economic expansion could pick up the underlying causes of the strength in money from the more moderate pace experienced in demand over the second and third quarters the third quarter. While demands for short and the prospects for its velocity. Reflecting term credit had slowed in the third quarter, these uncertainties, the short-run tolerance borrowing in debt markets had again been ranges for the aggregates adopted at these quite substantial. The Treasury had moved meetings were, for the most part, somewhat from a cash surplus to a deficit position. State wider than typically had been the case. For the and local government borrowing remained un Federal funds rate, a 6V4 to 63A per cent range usually heavy, as they continued to pre-refund was specified at the October meeting and was issues. External financing by business ex retained through the year-end. ceeded the gap between capital outlays and Estimates of monetary growth strengthened cash flow, suggesting some anticipation of after the October FOMC meeting, and by the higher borrowing costs in the future. By the end of the month they became sufficiently time the Committee met in October, interest strong, with M-l projected at rates above its rates were moving upward across the maturity range of tolerance and M-2 not far from the spectrum. top, thus calling for some response from the Desk. It was desirable to move promptly since the Treasury was beginning its quarterly Mid-October to Year-End financing. Consequently, the Desk began The picture of the economy presented at the seeking a Federal funds rate in the area of 6V2 October meeting was mixed. Staff projections to 6% per cent in late October until a softening suggested that growth in real GNP would pick in the aggregates, reported a short while later, up over the remainder of the year and would led it to return to the 6V2 per cent objective. then continue at a moderate, though diminish Thereafter, estimates of growth of the aggre ing, pace. The rate of inflation was expected to gates remained within the ranges specified by remain high, although lower than in the first the FOMC, and the Desk sought a funds rate half of 1977, while the unemployment rate had of 6V2 per cent through the end of the year. shown no significant change since April. Pres Interest rates rose at the end of October and sure on the dollar in the exchange markets, into early November, as market participants Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
278 Federal Reserve Bulletin □ April 1978 concluded that a further shift in the course of nearly 30 and 15 basis points, respectively, monetary policy was emerging. When the from levels 2 months earlier though some drift money market firming proved temporary, the upward occurred later. Between mid-October increases were retraced for a while. The yield and the year-end, yields on most Treasury curve in the market for Government securities issues due after 5 years rose about 20 to 25 continued to steepen, however. The invest basis points while those on long-term corporate ment of the proceeds of exchange-market in bonds were up 20 basis points. Evidence that tervention by foreign monetary authorities put economic growth was not so sluggish as Treasury bill rates under some downward many had thought and worries that inflation pressure. would accelerate and that Treasury deficits At the auctions on December 21, 3- and as well as private credit demands would grow 6-month bills were awarded at average rates of led to expectations that interest rates would 5.99 per cent and 6.34 per cent, down by need to rise further in the new year. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
279 EFT and Privacy This article on electronic fund transfers—the vidual privacy rights and recordkeeping prac means by which funds are transmitted electron tices. The Privacy Protection Study Commis ically rather than by paper checks or by sion did not devote any chapters to the subject cash—was prepared in the Division of Federal of privacy and EFT in its published report Reserve Bank Operations and in the Office of entitled Personal Privacy in an Information Public Affairs. Society. It did make three recommendations regarding this subject, which will be discussed Most public forums and surveys seem to indi later. cate that consumers are apprehensive about Of the consumer issues that have been raised electronic fund transfers (EFT). Some of this and considered in connection with EFT, no apprehension stems from the fact that EFT is issue appears at this time to have received more new and different. Much of it stems from the attention, or to be more misunderstood, than uncertainty surrounding EFT, as a result of the the issue of personal financial privacy and current absence of a legal framework of rights, EFT. This article examines some of the find liabilities, and responsibilities for all partici ings and recommendations of both the NCEFT pants (consumers, merchants, and depositary and the Privacy Commission and attempts to institutions). Consumers are concerned that improve understanding of the relationship of under EFT they may lose float, may not receive privacy of financial records to EFT by provid receipts, may be liable for unauthorized use of ing a better understanding of the nature of the electronic transfers, and/or may endanger the problem. Much of the confusion and misun confidentiality of their financial transactions. derstanding surrounding the issue is defini The National Commission on Electronic tional. Therefore, at the risk of being too Fund Transfers (NCEFT)1 has completed its elementary, it may be helpful to define the work and issued its report to the President, the problem of EFT and privacy. Congress, and the American people. Its report, There are issues of corporate and govern EFT in the United States, devotes four chap ment privacy, as well as privacy of information ters to these and many other consumer interest concerning people. They are real and important considerations. Several EFT consumer protec questions because there are incentives to ob tion bills have been introduced in the Congress. tain information about corporate and govern There will undoubtedly be much debate before ment payments. This, however, is an issue of comprehensive EFT legislation is enacted. security of information, involving attempts to Such legislation may be enacted in stages, with obtain such data by means not provided for in the first stage being consumer protection. law. This paper does not address these prob The Privacy Act of 1974, which became lems and is limited to questions of privacy that effective on December 31 of that year, created arise within the framework of law. a seven-member commission to examine indi- *A 26-person commission established October 28, 1974, EFT by the Congress to study EFT in all aspects and to recommend public policy toward the development of What is EFT? EFT—electronic fund electronic systems for the transfer of funds. The transfers—is the application of electronic NCEFT’s final report devoted one chapter to EFT and privacy alone. This chapter made 22 recommendations. technology to financial payments now made Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
280 Federal Reserve Bulletin □ April 1978 by cash and checks. While EFT will displace tape. Depositary institutions receive instruc some cash payments, it is primarily an alterna tions from corporate or other customers to make tive to the check. In many applications it transfers—to pay out or collect funds—from cus displaces fund transfer instructions now made tomers of the depository who have elected to and conveyed on paper, processing and stor participate in a program of direct transfer. The ing the instructions as it transfers funds elec originating depositary institutions record these tronically into and out of deposit accounts. instructions on magnetic tape and deposit the Just as the electronic calculator has replaced tapes with a Federal Reserve Bank. The serv the slide rule, EFT seems destined to displace ices currently offered by participating de many current check uses because electronic positary institutions utilizing Federal Reserve technology can be a more efficient, secure, facilities are direct deposit of payrolls and convenient, and less costly method of trans preauthorized payments of recurring bills such ferring funds than is the check. as mortgage and utility payments and insur Two types of electronic or other fund ance premiums. Receiving depositories accept transfers predominate in the U.S. economy. ACH payment instructions and charge them One flows from businesses and government to to their customers’ accounts. consumers, and the other is a reverse flow ACH operations parallel check-clearing op from consumers to businesses. Businesses and erations in many respects. There is, however, government as payors make recurring income a fundamental difference—already noted: In payments for salaries, wages, commissions, an ACH operation the instructions to transfer interest, dividends, annuities, social security, funds are made and exchanged on magnetic welfare, retirement, and the like. Consumers tape instead of on paper checks. The Federal make recurring payments to businesses such Reserve plays similar roles in helping to effect as mortgage, utility, and insurance payments, both check and EFT payments. Federal Re and nonrecurring payments to businesses for serve Banks that operate ACH’s receive ACH retail purchases. payment instructions on tapes from any EFT technology serves these two major member bank and from any member of an payment flows in several ways. In the ver ACH association. Federal Reserve Banks de nacular of EFT, the automated clearinghouse liver these private-sector items to member (ACH) is the essential feature of the system banks and members of the ACH associations for handling recurring payments initiated in under published guidelines, making use of large volumes. Point-of-sale (POS) terminals established arrangements for check delivery are the essential feature of the system for and pick-up. For recurring Federal payments, handling nonrecurring payments for consumer the Federal Reserve acts as the fiscal agent for purchases of goods and services at merchant the Government and, in this role, provides locations. The Federal Reserve provides op clearing, settlement, and delivery functions erational facilities to ACH’s but does not under rules established in cooperation with the participate in POS operations. Treasury Department. An ACH mechanism involves the following An electronic POS system is designed to participants: a private automated clearing permit a merchant’s customers to pay— house association; depositary institutions that through the computer terminal in the store— are members of the clearinghouse association for goods or services they buy in the store. and that originate and receive fund transfers; Payment is made by electronically transmitting corporate and individual customers, for whom a message from the terminal at the merchant’s the transfers are made; and the operator— counter to a computer in a depositary institu Federal Reserve or other—of an ACH. An tion participating in the local POS system. The ACH association is a group of private deposi POS terminal may also provide an information tary institutions that has agreed to abide by service such as verifying or guaranteeing a certain rules and procedures for the purpose of check or authorizing drawing on a preexchanging payment instructions on computer established line of credit. The POS process is Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
EFT and Privacy 281 initiated, and guided, by presentation at the may not aggravate the problem. However, it point of sale of a plastic card that can be has brought it into sharper focus. “read” by the merchant’s terminal. Most POS Electronic technology is pervasive in the terminals are expected to be installed, as some processing and storage of check payments, but are now, at cash registers. As noted, the this fact is not seen by consumers, and they Federal Reserve does not participate in the consequently do not react to it. EFT discus process of fund transfers at the point of sale. sion has brought consumers to a realization that their financial transaction information4 is being transferred through and to, and stored by, computers. This is a concern to many PRIVACY because of the belief that access to a collection How, then, does privacy relate to EFT? The of information containing an individual’s bank personal privacy issue is not related to EFT ing record could enable one to draw a profile per se, but to the recordkeeping of participat of that individual’s financial condition and his ing financial institutions. That is, EFT relates life style. Both the NCEFT and the Privacy to personal privacy indirectly since participat Commission have argued that EFT expands ing financial institutions keep records of the the potential for abuse of personal privacy electronic transfer instructions and related in because it lowers the cost and increases the formation they originate or use. Privacy, in ease of access to such collections of informa this context, refers to the confidentiality of tion. personal financial records and recordkeeping At the present time there is a legal require relationships. ment in the Bank Secrecy Act—but no eco In that connection, the NCEFT and the nomic incentive—for banks to store informa Privacy Protection Study Commission con tion obtained from large numbers of paper cluded that individuals are losing control over checks for up to 5 years. Clearly, few if any access to and use by Government or other banks or other recordkeeping organizations third parties of personal financial information would go to the expense of doing so if it were maintained at recordkeeping organizations. not required by law. Amending the Bank Se Evidence cited was legislation such as the crecy Act to substantially reduce the maximum Bank Secrecy Act,2 which calls for the collec time period of 5 years5 for which banks must tion, storage, and reporting of substantial retain records of domestic payments would amounts of information on individual financial significantly reduce reasons for apprehensions transactions, and a recent Supreme Court de regarding privacy, but it would not eliminate cision (United States v. Miller)3 that held that them. The threat to privacy perceived in EFT an individual has no constitutionally protected is thus in large part, at least, an extension of an expectation of privacy with respect to finan existing problem. cial transaction information maintained by his depositary institution in compliance with the Bank Secrecy Act. In adopting this ruling, the PROPOSED REMEDIES court cited the expressed purpose of the Bank Secrecy Act—to require that such records be The real issues as documented by the NCEFT kept due to their usefulness in criminal, tax, and the Privacy Commission are record reten and regulatory investigations. The growth of concern about privacy pro tection, it is evident, presents a problem not 4Generally, the information on the face of a check: the customer’s name, bank, and bank account number, and only for EFT. It is likewise a problem for the the name of the person or organization receiving the pay current paper payments system. EFT may or ment. However, computers handling checks can distin guish only the customer’s account number and the identity of the customer’s bank. In EFT the computer 212 U.S.C. Sections 1829b (1951-59); 31 U.S.C. Sec would also be able to distinguish the identity of the person tions 1051-1122 (1970). receiving, or requesting, the payments. 3425 U.S. 436 (11976); 92 S. Ct. 1619 (1976). 531 CFR 103.36(c). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
282 Federal Reserve Bulletin □ April 1978 tion and record control. The NCEFT6 recom the problem concerning the privacy of per mended Federal legislation that would sonal accounts arises from statutory require minimize legislative record-retention require ments governing recordkeeping organizations ments and provide consumers with control of and from the lack of control over their records their financial transaction information. More by individuals. But the statute requiring the specifically, the Privacy Commission7 rec recordkeeping—the Bank Secrecy Act—does ommended that the Government minimize not apply to the Federal Reserve.10 The recordkeeping requirements such as those im Commission goes on to recommend that the posed by the Bank Secrecy Act, that consum Federal Reserve (which is not a recordkeeping ers be provided with legal standing to contest institution) be prohibited from providing EFT Government access to their financial transac services. This does not appear to be in keeping tion information, that Government surveil with the Commission’s determination that the lance of individuals by means of EFT systems root of the problem is in the recordkeeping be prohibited, that access be obtained by due requirements of the Bank Secrecy Act. process of law only, and that third-party ac The assertion that Federal Reserve opera cess be prohibited unless authorized by the tion of ACH facilities is a greater threat to consumer. privacy than private operations is based on the In addition, the Privacy Commission rec belief that Reserve Bank involvement in EFT ommended and the NCEFT endorsed the fol payments will increase the likelihood and op lowing: portunities for government agencies to obtain 1. ‘That individually identifiable account and possibly misuse information about indi information generated in the provision of EFT viduals. Those sympathetic to this view be services be retained only in the account rec lieve that private operation of EFT networks ords of financial institutions and other parties will act as a buffer to such access. The theoret to the transaction, except that it may be re ical and factual bases of this opinion are tained by the EFT service provider to the examined below. extent and for the limited period of time that To begin with, some observations about the such information is essential to fulfill the oper Federal Reserve’s role in ACH operations and ational requirements of the provider;” and its record-retention policy and legal position 2. ‘‘That procedures be established so that may be of interest. First, it may be helpful to an individual can promptly correct inac describe briefly in some detail the Federal curacies in transactions or account records Reserve’s role in an ACH. An ACH operated generated by an EFT service.” by a Reserve Bank reads, edits, and balances The Privacy Commission also recom the information on the tape it receives from a mended that the Federal Reserve or any other depositary institution, sorts the data according governmental entity be prohibited from to the depositary institutions that are to re operating ACH facilities.8 The NCEFT was ceive the instructions to transfer funds, and sufficiently concerned about this recom prepares aggregate accounting information for mendation by the Privacy Commission to debits and credits to the appropriate deposi explicitly disagree in its report, which called tary institutions. When processing has been the recommendation unnecessary and eco completed, the computer creates new mag nomically disruptive.9 netic tapes (or descriptive paper listings for The Privacy Commission determined that receiving institutions with only a few instruc tions, or for institutions that cannot use elec tronically recorded information). The new 6National Commission on Electronic Fund Transfers, EFT in the United States, 1977, pp. 19-36. 7The Privacy Protection Study Commission, Personal 10The Bank Secrecy Act was passed by the Congress to Privacy in an Information Society, 1977, pp. 116-24. require certain recordkeeping by depositary institutions Hbid., p. 123. dealing with the public. Thus, the act does not apply to the 9National Commission on Electronic Fund Transfers, Federal Reserve, as it functions as the Nation’s central op. cit., pp. 37-39. bank and deals with financial intermediaries. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
EFT and Privacy 283 tapes, or paper listings, are delivered to the credited or debited—and (2) an obligation to receiving depositary institutions. These, in the other participants—financial institutions— turn, debit or credit accounts of customers in the ACH process. who have agreed to participate in the program. With respect to the customer, there is a Settlement for the transactions among finan clear line of court decisions that establish the cial institutions is accomplished by posting proposition that a bank has an implied obliga credits and debits to reserve balances main tion to maintain records of its relations with its tained by member banks of the Federal Re depositors in confidence until compelled by a serve System. court or suitable legal process to produce In providing this service the Federal Re them. The courts have not held that there is a serve does not need to keep for such an depositor bank privilege, however, and this extended time as that required by the Bank signifies two things: The customer’s records Secrecy Act detailed records of the informa are available for inspection by a party using tion it processes. The Federal Reserve has legal process (court order, for example); and recently completed a Systemwide review of its the bank’s obligation to treat the customer’s data-retention procedures for ACH payments record in a confidential manner can be modified and has approved a reduction in the time by an express agreement to the contrary. Only Reserve Banks may retain such information to so long as an EFT operator—governmental or the period regarded as essential to satisfy private—retains private financial information operational requirements. in its possession, therefore, is it vulnerable to Second, and most important, since the Fed a legal process that seeks disclosure of that eral Reserve is not subject to the Bank Se information. crecy Act, it is most unlikely that the Federal As for the obligation to the other partici Reserve would be able to comply with a pants in the ACH process, the Reserve Banks Government request for complete payments or private operators have an obligation to op information about an individual. Only the con erate the ACH facility in accordance with sumer’s financial depository will have any rules that apply to them and with the operating thing approaching a complete record. agreements that they may have with the ACH Third, Federal Reserve policy provides for association or its participants. The Reserve release of payments information that is tem Banks or private operators, acting under a porarily in its possession only upon receipt of general rule of due care, could not engage in a subpoena or in other limited circumstances. clearing operations if they did not maintain Language in the contract between the Federal records needed in tracing adjustments that Reserve and the National Automated Clear might be necessary following the settlement inghouse Association for a pilot interregional date. Experience shows that inquiries, com ACH project prohibits any party to the con plaints, and disputes will arise between finan tract from unauthorized disclosure of indi cial institutions and their customers, and that vidually identifiable payments information not financial institutions expect and receive assist required by law, without the written consent ance from the operator of the ACH facility in of the individual or firm concerned. resolving these customer problems. Moreover, In other words, the key factor is that the the Reserve Banks or private ACH operators Federal Reserve need not retain payments would hardly be perceived as promoting a information longer than is deemed necessary, reliable and efficient system for the electronic whereas recordkeeping or depositary institu transfer of funds unless they provided such tions are, at present, legally required to keep assistance. such information for long periods. The two obligations described are quite dif Operators of an ACH facility, whether pub ferent. If we look only at the first—to maintain lic or private, have a twofold responsibility: the confidentiality of the ACH data—the Re (1) an obligation to depositors—the individual serve Bank or the private ACH operator or business whose bank account is being would protect the customer best if ACH Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
284 Federal Reserve Bulletin □ April 1978 operators kept no historical data bases of issue that relates to financial information and transactions identifiable by customer. They EFT. That issue has little or nothing to do with would then have no information of a private who are the operators of EFT systems. It nature that could be disclosed, lost, or stolen. does, however, have a great deal to do with From the privacy point of view, that would be laws that require financial institutions to retain ideal. financial data for long periods of time, and On the other hand, the responsibility of the with court decisions severely limiting indi operator to serve as a source of information viduals’ standing in court regarding access to for some reasonable time after settlement to their financial data. effect any necessary adjustments suggests that Those who are concerned about financial operators must create and retain, for a practi privacy in EFT systems can address these cal time, data logs that would make possible problems directly through the legislative pro the re-creating of each transaction. The fact is cess by establishing two requirements: (1) that a payments system cannot operate with EFT operators should not be subject to re out such minimal records because no one quirements to retain data for periods longer would be able to assume the financial respon than necessary for verification purposes; and sibility. These two responsibilities must be (2) operators should not of their own accord balanced. keep data longer than is in fact necessary to In conclusion, there is indeed a privacy satisfy such verification requirements. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
285 Statement to Congress Statement by J. Charles Partee, Member, ing problems, the Board believes the data to Board of Governors of the Federal Reserve be a good deal lower in quality than most System, before the Committee on Banking, regularly collected banking data and has seri , Housing and Urban Affairs U.S. Senate, ous reservations about its reliability. March 16, 1978. Because of these and other shortcomings of a statistical approach to the subjects covered, I appreciate the opportunity to present today the Board believes that it is essential to go the views of the Board of Governors of the beyond the survey results before recommend Federal Reserve System on the results of the ing any regulatory or legislative change. The survey on bank stock loans, insider loans, and Federal Reserve plans to conduct promptly a overdrafts that was recently conducted for this followup investigation of those State member committee. The Federal Deposit Insurance banks indicated by the survey returns to have Corporation (FDIC) has provided summary engaged in possibly improper activities. We data from the survey based on reports from will be prepared to submit our findings and rec 14,137 banks, representing about 98 per cent ommendations to the Congress within 90 days. of all insured commercial banks. Earlier this Meanwhile, the Board continues to support S. week, the three Federal bank supervisory 71 as passed by the Senate, as well as the agencies also forwarded to this committee a additional provisions of H. R. 9450 introduced joint staff analysis of the survey data. As this in October 1977 by Congressman Allen. comprehensive analysis has been made avail Among those provisions are restrictions on able to the committee, I will not review the extensions of credit to insiders, including in results of the survey in any detail today. siders at correspondent banks. Instead, I want to focus on several of the However, I am prepared to convey today major findings, including several that are the Board’s preliminary reaction to the con cause for concern. tents of the survey. In general, while the Before discussing the principal findings, I results raise questions about potential insider believe it important to caution that many abuses, these dubious practices do not appear banks experienced considerable difficulty in to be widespread or to involve quantitatively filling out the report form. The survey was large commitments of available funds. Indeed, very broad in scope, was conducted under the aggregate dollar amount of the types of extraordinarily tight time constraints, and did loans covered in the survey (bank stock loans, not allow for the careful pretesting that is our loans to insiders of the reporting bank, and standard procedure in survey undertakings. loans to insiders of other banks) represents Due to the complexity of the survey questions, only about 3 per cent of the total loans at much of the information requested was not domestic offices of all commercial banks. In readily available from central records and had addition, it appears that the great majority of to be retrieved by hand from credit and collat each of these three types of loans was made eral files. In addition, lack of familiarity with on something close to standard commercial this one-time survey questionnaire undoubt terms, as indicated by the finding that more edly caused difficulties in bank interpretations than 90 per cent of each type of loan carried and responses. While very substantial efforts interest rates that were at or above the were made to identify and rectify such report prime rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
286 Federal Reserve Bulletin □ April 1978 Moreover, it should be recognized that reasons having nothing to do with the loan. In important and legitimate economic functions addition, the survey data indicate that insiders are served by most of the lending activities of other banks typically obtained lower rates covered by the survey. Bank stock loans pro on their bank stock loans when a corre vide the means for the orderly transfer of bank spondent balance was maintained with the ownership, especially in unit or limited lending bank. The interest rate on bank stock branching States where nearly three-fourths of loans was above 8 per cent on only one-fifth of such loans were made. Loans collateralized by the fixed-rate loans where balances were bank stock also represent a significant source maintained, compared with more than oneof funding to augment bank capital. And al half of such loans where balances were not though nearly 90 per cent of the credit ex present. Similarly, the interest rate was below tended to insiders at the reporting bank repre 7 per cent on 46 per cent of loans when sented loans to directors and their business balances were maintained compared with only interests, the vast majority of these loans 18 per cent when there were no such balances. probably represent normal commercial credits It is important to recognize, nevertheless, to customers who rank among the bank’s best. that the data do not provide conclusive evi I would like to consider each of the four dence of more favorable treatment. The rate of parts of the survey, review the potential prob interest is only one among several important lem areas that they addressed, and discuss the terms and conditions of a credit transaction. Federal Reserve System’s approach to dealing Data on other factors such as origination date with these problems. of the loan, the maturity of the loan, the The first part of the survey focused on loans creditworthiness of the borrower, and the secured by bank or bank holding company loan/collateral value ratio were not collected stock. The primary objective was to determine and could account for differences in rates. whether insiders may have used the corre Moreover, it may be noted that for the bulk of spondent balance of their banks in order to the loans where a balance was maintained, obtain bank stock loans from other banks, there was no apparent relationship between possibly at preferential rates. Banks were the interest rate on the loan and the size of the asked to report data on each loan with a balance. Thus, borrowers apparently did not current balance of $25,000 or more if the receive lower rates by having their bank main lending bank held in the aggregate as collateral tain a larger balance. Finally, the survey evi 10 per cent or more of the outstanding voting dence indicates that bank stock loans were not shares of the banking organization whose often negotiated at rates below the prevailing stock was pledged on the loan. Less than 6Vi prime rate. For example, during the most per cent of the banks reported having such recent 1976-77 period, when 85 per cent of the loans, and most of the loans reported were reported loans were originated or rolled over, made by the larger regional and money center less than 2 per cent appear to have been made correspondent banks. About four-fifths of at below the average prime rate. these loans were made to insiders—that is, The second part of the survey dealt with all executive officers, major shareholders, or types of bank loans in excess of $10,000 (in directors—of the bank or bank holding com cluding mortgage loans of more than $60,000), pany whose stock was pledged. to insiders of other banks. Again, the primary The survey results raise the possibility of objective was to determine whether insiders some insider abuse connected with bank stock may have used the correspondent balances of loans. In 88 per cent of the reported loans, the their banks in order to obtain loans from other bank whose stock was pledged maintained a banks, perhaps on more favorable terms. The demand balance with the lending bank. Of evidence suggests that lower rates were some course, the correspondent relationship may times received by these insiders when their have been long established, predating the bank banks maintained balances with the lending stock loan, or might have been entered into for bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Statement to Congress 287 For example, when a demand balance loans to individuals connected with the de was maintained, the weighted-average rate for positing bank could warrant prosecution in fixed rate loans was 7.58 per cent, compared certain situations. with 8.47 per cent for loans when a balance Since 1967 the Federal supervisory agencies was not maintained. For all reported floating have been exchanging information developed rate loans, when a correspondent balance was during examinations on loans to officers of maintained the weighted-average rate for other banks and loans secured by stock of loans was 7.72 per cent, versus 8.21 per cent other banks. All reports of loans to officers of for loans without a balance. Again, care must State member banks received from the other be taken in interpreting these rate compari agencies are verified at subsequent examina sons. The differences on average are not par tions of the banks where the officers are ticularly large and may reflect other factors on employed to determine compliance with Sec which information was not collected as part of tion 22(g) of the Federal Reserve Act and the the survey. Board’s Regulation O. The examiners, in 1973, It should be pointed out that the mainte were further instructed to expand their nance of correspondent balances is a neces verification of these reports to include, among sary, long-established practice in the banking other things, a determination of whether more system that ordinarily represents a mutually favorable interest rates were being obtained beneficial arrangement for the banks involved. and whether correspondent balances held with For example, smaller banks typically maintain the lending bank were commensurate with the demand balances with regional or money cen services provided. ter correspondents to compensate the latter Our concern about potential abuses in the for the provision of a wide variety of services granting of bank stock loans or loans to execu such as check clearing, deposit accounting, tive officers also has been reflected in several and investment advice. Given a continuing public statements issued in connection with close relationship of this nature between bank bank holding company applications. In each ing organizations, which generally necessi application for approval to form a bank hold tates frequent contact between their senior ing company or to acquire an additional sub personnel, it is only natural for officials of the sidiary bank, the Board requires disclosure of smaller bank to seek accommodation at the any indebtedness collateralized by the bank’s correspondent bank. The correspondent’s stock, including an indication of any changes lending officers typically will know the bor in correspondent balances or a description of rower very well, and in those cases when the any agreement or understanding concerning stock of the smaller bank is pledged, they will correspondent balances. The purpose of this be familiar with the condition of the bank. requirement is to determine whether bank Nonetheless, the Board has recognized for credit is being obtained on a basis that encour some time the possibility of abuse in the ages or rewards the improper use of interbank placement of correspondent balances and has deposits. The Board considers the existence of taken a number of measures to limit such more favorable loan terms in connection with abuse. As you know, the Federal Reserve the placement of a bank’s correspondent ac received a letter in September 1970 from the count as an adverse managerial and banking Justice Department citing the inappropriate factor in acting on holding company cases. use of correspondent balances for the personal Similar disclosure is required in the annual benefit of bank officials. The views of the reports that bank holding companies must Justice Department and the concern of the submit to the Board. All of this information is Board of Governors on this matter were con reviewed and taken into consideration by the veyed to each State member bank in a letter Federal Reserve in its regulatory and super from Chairman Burns on October 26, 1970. It visory actions regarding bank holding com was indicated that the practice of using inter panies. In some instances, we have been able bank deposits as compensating balances for to detect and to eliminate preferential interest Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
288 Federal Reserve Bulletin □ April 1978 rates on loans collateralized by bank stock. that are more favorable than those afforded However, the determination of abuse regard other borrowers. Last year, the Senate ap ing correspondent balances is more difficult in proved legislation that would extend and view of the numerous services that can be strengthen the restrictions of Section 22. One rendered to justify the balances. of the provisions adopted in S. 71 would The third part of the survey dealt with loans prohibit a commercial bank from making a by banks to their own insiders. The primary loan to any officer, director, or 10 per cent objective was to determine whether insiders shareholder, or to any company controlled by may have received preferential rates. Banks such parties, unless such loan was made on reported $10 billion of such loans, of which substantially the same terms as those prevail nine-tenths had been made to directors of the ing for comparable transactions with other bank or their business interests. It is difficult persons. In addition, such insider loans could to interpret the significance of this finding not involve more than normal credit risk and because bank directors are frequently re could not contain other features unfavorable cruited from among a bank’s best customers. to the bank. As you know, the Board strongly Thus, a loan relationship with a director’s supported S. 71 and hopes that it will be outside business may well predate his ap enacted by the Congress this year. Such legis pointment to the bank’s board. In other lation should go far in protecting banks from words, a substantial proportion of those loans abuse from insider lending. probably would have been made regardless of The final part of the survey dealt with any “insider” relationship. overdrafts by insiders of the reporting bank, The survey results show that the average insiders of other banks, and public officials. rates paid by insiders were generally above the The objective was to determine whether there prime rate, that is, the rate charged by large were significant abuses associated with these banks to their most creditworthy customers. overdrafts. The survey showed that two-thirds For example, for the fixed-rate loans made to of the reporting banks had no overdrafts ex insiders at the reporting bank during the third ceeding $500 to any of their own insiders at quarter of 1977, the average rate was 8.07 per any time during the first 9 months of 1977. cent, compared with an average prime rate dur More than 90 per cent of the banks had no ing that quarter of 6.90 per cent. On fixed-rate overdrafts of more than $500 during that loans made to insiders during the first half of period to insiders of other banks or to public 1977, the average insider rate was 8.29 per cent, officials. well above the average prime rate of 6.36 per However, two findings deserve comment. cent. The average insider rate was significantly First, there were reports of isolated cases of below the average prime rate only for loans very large overdrafts, mostly to insiders of the originated in 1974. This was an abnormal year reporting bank. These overdrafts may have in that the prime rate rose precipitously during been of very short duration or may have been the year to a record high. Many smaller banks offset by other accounts held at that bank, but do not closely follow the large bank prime rate they deserve further investigation. Second, a in pricing their loans, which could account for large proportion of the banks reporting over some of the reported loans having been made drafts to their insiders indicated that they at rates below prime in that year. always or frequently waive overdraft charges. In the Board’s view, the survey data do not The fact that charges are waived much more seem to suggest any widespread abuse involv frequently for insiders of the reporting bank ing insider loans. In part, this may reflect than for insiders of other banks and public enforcement efforts under Section 22 of the officials suggests also that there is a more Federal Reserve Act, which places tight limi favorable treatment of the former group than tations on the types and amount of loans a of the general public. member bank can make to its own executive It should be noted that overdrafts are con officers, and prohibits terms on such loans sidered to be unsecured extensions of credit Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Statement to Congress 289 and are included in the limits on loans to mercial banks. The real possibility of a signifi executive officers of member banks under cant incidence of questionable practices, how Section 22(g) of the Federal Reserve Act. ever, has been brought to light. These will Such loans are limited to a maximum of have to be considered carefully on a case-by- $5,000. We will, of course, take into account case, bank-by-bank basis before any firm con these survey results in order to ensure in the clusion of abuse is warranted. But if the course of our examinations that there is full suggestion of improper practice is validated, compliance with this statute. supervisory action will be taken. Such action, In summary, the survey findings do not scaled appropriately to the indicated viola appear to indicate any pervasive pattern of tion, could be more readily and flexibly more favorable treatment for insiders at com applied if S. 71 were to become law. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
290 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON FEBRUARY 28, 1978 1. Domestic Policy Directive The information reviewed at this meeting suggested that retail sales, industrial production, and housing starts had been adversely af fected in January by unusually severe weather. It appeared, how ever, that there had been little change in the underlying economic situation. In the fourth quarter of 1977, according to estimates of the Commerce Department, real output of goods and services had grown at an annual rate of 4.0 per cent, down from a rate of 5.1 per cent in the third quarter. However, final sales in real terms had expanded at a considerably faster pace than in the third quarter, and the rate of business inventory accumulation had slowed sharply. The rise in average prices, as measured by the fixed-weighted price index for gross domestic business product, had stepped up somewhat to an annual rate of 5.5 per cent in the fourth quarter from 5.0 per cent in the third. Staff projections for the year 1978, like those prepared just before the Committee’s meeting in mid-January, were based on assump tions that included reductions next fall in Federal income taxes. The projections continued to suggest that growth in real GNP would be sustained at a good pace throughout the year, although the over-all rate was somewhat below that anticipated earlier because of scaled-down projections for housing starts, auto sales, and total government purchases of goods and services. It was still expected that the rise in prices would remain relatively rapid and that the unemployment rate would decline moderately further over the year. The latest projections suggested that growth in output would be less rapid in the first quarter of 1978 than had been expected earlier, in large part because of the adverse weather, but that the weatherrelated losses would be about made up later. Thus, it was expected Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Record of Policy Actions of FOMC 291 that growth of consumer spending in real terms—which had been exceptionally rapid in the fourth quarter of 1977—would slow even more in the current quarter than had been anticipated and that expansion in business fixed investment and in residential construc tion also would fall short of earlier expectations. It was anticipated that growth in consumer spending would pick up in subsequent quarters—particularly in the fourth quarter, following the reduction in personal income taxes assumed to take effect on October 1. Business fixed investment was still projected to expand moderately over the remaining quarters of 1978, owing in part to stimulative modifications of the investment tax credit that were assumed to be retroactive to the beginning of the year. It was now anticipated, however, that residential construction activity would begin to edge down after midyear in response to the less favorable mortgage market conditions that now appeared to be developing. In January industrial production declined 0.7 per cent—about as much as it had risen over the preceding 3 months—as the unusually severe weather caused widespread absenteeism, reduced work weeks, and disruptions to supplies. Moreover, auto manufacturers curtailed assemblies in an effort to control dealers’ inventories, and the ongoing strike of mineworkers reduced production of coal further. Nonfarm payroll employment continued to expand in January, and after adjustment for strikes, the gain was in line with the monthly-average rise during the second half of 1977. Increases were again sizable in manufacturing, trade, and services. Because of the unfavorable weather, however, construction employment declined, and the average workweek of production workers in nonfarm establishments fell sharply. The unemployment rate edged down to 6.3 per cent from 6.4 per cent in December. The total value of retail sales declined about 3 per cent in January, according to the Census Bureau’s advance estimate, after having expanded 5 per cent over the preceding 3 months. Sizable decreases in January were reported for almost all major categories of stores, at least in part because of the weather. Unit sales of new domestic autos declined 10 per cent to the lowest rate since late 1976, when supplies had been limited by a strike in the auto industry. Private housing starts fell from an annual rate of 2.2 million units in December to 1.5 million units in January. Declines occurred in all Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
292 Federal Reserve Bulletin □ April 1978 regions of the country and were especially large in areas that had suffered major storms. Manufacturers’ new orders for nondefense capital goods fell 5 per cent in January after having risen about 9 per cent in December. However, the machinery component changed little in January after an increase of almost 8 per cent in December. The index of average hourly earnings for private nonfarm produc tion workers rose sharply in January, in part as a result of the increase in the Federal minimum wage from $2.30 to $2.65 per hour at the beginning of the year. Increases were especially large in trade and services, where adjustments in the minimum wage have tended to have more widespread effects. The consumer price index for all urban consumers rose 0.8 per cent in January, almost twice the monthly-average increase in the second half of 1977. About two-thirds of the rise in January was attributed to price increases for foods and beverages and for housing, although prices advanced for all major categories of expenditures. The increase in the wholesale price index for January—0.9 per cent—also was considerably more than the average rise during the second half of 1977. In January average prices both of farm products and foods and of industrial commodities advanced substantially. In foreign exchange markets, after almost a month of calm, the dollar came under renewed downward pressure around mid- February, and its trade-weighted value against major foreign curren cies declined about 1 Vi per cent during the second half of the month. Almost all major currencies rose against the dollar; the largest appreciations were registered by the Swiss franc and the German mark. The U.S. foreign trade deficit increased appreciably in the fourth quarter of 1977. It appeared that the dock strike, which halted containerized shipments through Atlantic and Gulf Coast ports between October 1 and November 29, had depressed recorded exports more than recorded imports. After allowance for the appar ent effects of the strike, the deficit was still slightly larger in the fourth quarter than in any of the first three quarters of the year. A deficit of $31 billion (international accounts basis) was estimated for 1977 as a whole, up from $9 billion in 1976. At U.S. commercial banks, total credit expanded substantially in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Record of Policy Actions of FOMC 293 January, after having changed little in December. The January expansion, which was about in line with the average rate of growth during the fourth quarter of 1977, was attributable chiefly to a rebound in loan expansion. Growth in business loans and in loans to finance security holdings accelerated, and expansion in real estate and consumer loans apparently remained large. As in earlier months, banks financed a sizable part of the January increase in total loans by reducing their holdings of Treasury securities. For nonfinancial businesses the January pick-up in loan growth was especially evident at smaller banks. Lending to nonfinancial businesses also rose somewhat at large banks during January, but it remained below the pace of late 1977, and these businesses managed a sizable net run-off of their outstanding commercial paper. The narrowly defined money supply (M-l) expanded at an annual rate of llA per cent in January, but data for early February suggested a decline from the January level. From the fourth quarter of 1976 to the fourth quarter of 1977, M-l had grown 7.4 per cent, compared with 5.6 per cent in 1976 and 4.4 per cent in 1975.1 Growth in M-2 picked up in January to an annual rate of about 8lA per cent—from 53A per cent in December—reflecting some strengthening in inflows to banks of time and savings deposits other than negotiable CD’s. From the fourth quarter of 1976 to the fourth quarter of 1977, M-2 had grown 9.6 per cent, compared with 10.9 per cent in 1976 and 8.3 per cent in 1975. Deposit growth at nonbank thrift institutions continued to slow in January, and M-3 expanded at an annual rate of 8 per cent—about the same as in December. Over the four quarters of 1977, M-3 had grown 11.6 per cent. At its January meeting the Committee had decided that operations in the period immediately ahead should be directed toward maintain ing about the prevailing money market conditions, provided that the monetary aggregates appeared to be growing at approximately the rates then expected. Specifically, the Committee sought to maintain the weekly-average Federal funds rate at about 63A per cent, so long lAt the time of this meeting, revision of the measures of the monetary aggregates to reflect, among other things, new benchmark data for deposits at nonmember banks had nearly been completed. It was reported at the meeting that, according to tentative estimates, the benchmark adjustment would raise the 1977 growth rates of M-l and M-2 by 0.4 and 0.2 of a percentage point, respectively. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
294 Federal Reserve Bulletin □ April 1978 as M-1 and M-2 appeared to be growing over the January-February period at annual rates within ranges of 2Vi to IVi per cent and 5 to 9 per cent, respectively. The members also agreed that if growth in the aggregates appeared to be approaching or moving beyond the limits of their specified ranges, the operational objective for the weeklyaverage Federal funds rate should be varied in an orderly fashion within a range of 6V2 to 7 per cent. It was understood that very strong evidence of weakness in the monetary aggregates would be required before operations were directed toward reducing the Fed eral funds rate below the 6% per cent level. Data that became available during the inter-meeting period suggested that growth in the monetary aggregates over the January-February period would be well within the specified ranges. The Manager of the System Open Market Account, therefore, continued to aim for a Federal funds rate of around 6% per cent. Over the 6-week inter-meeting period, the funds rate averaged 6.76 per cent, and weekly averages showed only minor deviations from that level. Other short-term interest rates also changed little on balance over the inter-meeting period, even though short-term credit demands remained relatively strong. Longer-term interest rates showed mixed changes for the period. Yields on State and local government bonds declined somewhat further, whereas those on Treasury, Federal agency, and corporate securities edged higher. Interest rates on mortgages rose during January, and some tightening of nonrate terms was reported as well. In order to cover mortgage takedowns in the face of weakening deposit flows, savings and loan associations increased their reliance on advances from the Federal home loan banks and other nondeposit sources of funds. This contrasted with the typical pattern in January of reductions in borrowings. In the Committee’s discussion of the economic situation and prospects, the members agreed that the expansion in activity was likely to continue throughout 1978. Most members thought that the staffs GNP projection was reasonable, but two or three members believed that growth in real GNP would fall somewhat short of the projected rate. Several members emphasized that the degree of uncertainty with regard to economic prospects and projections had been increasing. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Record of Policy Actions of FOMC 295 It was observed that at the current stage of this business expan sion some deceleration in growth toward a rate that could be sustained for the longer term would be a desirable development. The comment was also made that some deceleration would be acceptable in light of the inflationary pressures in the economy and of recent developments in the foreign exchange markets. Considerable concern was expressed that the rate of inflation might accelerate significantly as the year progressed. The comment was made that prospects for inflation had been inhibiting business decisions to invest in fixed capital, and it was suggested that an acceleration would adversely affect confidence and would dampen expansion in spending of other kinds. Such price behavior, it was noted, would pose difficult questions concerning the appropriate role of monetary policy. Two members expressed the view that over the year the rate of unemployment was unlikely to decline very much. Another member believed that a realistic objective for the unemployment rate now was considerably higher than it used to be, perhaps as high as 5Vi to 6 per cent. One of the members who thought that the staffs projection for real GNP represented the most likely outcome nevertheless cited certain elements in the situation that could cause growth in output to fall short of the rates projected. He suggested, first, that the sizable decline in stock prices over the 6 weeks since the January meeting of the Committee indicated a continuing lack of confidence in pros pects for business activity and profits, which could undermine the progress of the expansion. Like others, he agreed with the staff expectation that the economy would rebound from the effects of the severe weather and the coal strike. Nevertheless, he was concerned about the possibility that the loss of income because of those developments, even though temporary, could have enduring effects on consumer demands and on the general course of the economy. With respect to the U.S. foreign trade position, he did not see clear signs of the sort of expansion in activity abroad that would signifi cantly reduce the trade deficit. Another member expressed agree ment with this view of prospects for the trade deficit, while a third was somewhat more optimistic. One of the members who believed that growth in real GNP would fall somewhat short of the rate projected by the staff also believed Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
296 Federal Reserve Bulletin □ April 1978 that the shortfall would be concentrated in the second half of the year. In his view, growth in output would be buoyed until midyear by a rebuilding of inventories as well as by the recovery from the effects of adverse weather and of the coal strike. However, he thought that problems would develop later in the year in residential construction and in some other sectors of the economy. Another member expressed the view that the staff expectations for housing starts, even though scaled down since the January meeting, were still too high. Several members commented that they agreed with the scaleddown projections for both housing starts and auto sales, and some noted that for several months they had viewed the staff projections for those sectors as too high. It was observed that the outlook for those sectors was still relatively strong and that demands were likely to be supported by adequate supplies of credit and a willingness of consumers to assume debt. With respect to housing, the tendency of consumers to perceive homeownership as a good form of investment in a period of inflation also was mentioned as a factor likely to support demand. It was observed in the discussion that the current business expansion—now about 3 years old—had developed some serious imbalances. U.S. merchandise imports were much too high relative to the behavior of the world economy. Business fixed investment was low in relation to growth in over-all production, and a few members expressed doubts of significant improvement during 1978. State and local governments were running a sizable surplus in their accounts, thereby draining purchasing power from the private sector. Outstanding consumer credit was high in relation to personal income. Wage increases were high in relation both to improvements in productivity and to the level of unemployment. Corporate profits were low in relation to personal income and to costs of production. Prices of common stock were low relative to corporate profits. And the state of general confidence appeared to be unduly low in relation to the actual performance of the economy. One member expressed the view that confidence was being adversely affected by the large deficit in the Federal budget. He added that the budget estimates were based on the assumption of continued moderate growth in economic activity, and that if a recession should develop the deficit could swell to such a size that it Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Record of Policy Actions of FOMC 297 might take many years to return to financial stability. Another member noted that under present fiscal policies the Federal deficit apparently would remain substantial even if a state of high employ ment were reached. At this meeting the Committee reviewed its 12-month ranges for growth in the monetary aggregates. At its meeting in October 1977, the Committee had specified the following ranges for growth over the period from the third quarter of 1977 to the third quarter of 1978: M-l, 4 to 6Vi per cent; M-2, 6V2 to 9 per cent; and M-3, 8 to lOVi per cent. The associated range for growth in commercial bank credit was 7 to 10 per cent. The ranges being considered at this meeting were for the period from the fourth quarter of 1977 to the fourth quarter of 1978. In the Committee’s discussion of the 12-month ranges, all but one member expressed a preference for retaining the existing range for M-l. This member suggested that the upper limit for M-l be reduced by Vi of a percentage point and the lower limit be raised by a corresponding amount, yielding a range of AV2 to 6 per cent. In the case of the broader aggregates, most members favored no change in the existing range for M-2 and a reduction of V2 of a percentage point in the range for M-3. Two members, however, preferred a reduction of V2 point in the range for M-2. One of them also suggested a reduction of 1 point, while the other advocated a reduction of either \ or W2 points, in the M-3 range. The nearly unanimous preference of members for retaining the range of 4 to 6V2 per cent for M-l reflected several considerations. First, it was observed that any increase in the 6V2 per cent upper limit of the range could strengthen inflationary expectations, which already appeared to be intensifying, and could accentuate the current weakness of the dollar in foreign exchange markets. Second, because the rate of growth of M-l in 1977—about IV2 per cent—had significantly exceeded the upper limit of the Committee’s earlier ranges, it was suggested that a decision now to reduce the range might lack credibility. Third, it was noted that if the actual rate of growth in M-l during 1978 were to fall within a 4 to 6V2 per cent range, that would represent a significant slowing from the 1977 rate. Indeed, one Committee member observed that if—as seemed likely—some slackening were under way in the processes of finan cial innovation that recently had been facilitating economies in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
298 Federal Reserve Bulletin □ April 1978 transactions balances, an unchanged rate of growth in M-1 could be interpreted as involving an increase in monetary restraint. Finally, it was suggested that current uncertainties regarding the economic outlook militated against an adjustment in the M-1 range. While Committee members found these considerations persuasive, it was observed in the discussion that further gradual reductions in mone tary growth ranges would be needed over time if growth rates consistent with general price stability were to be achieved. Several Committee members noted that if during the coming year M-1 growth were to be constrained within a 4 to 6V2 per cent range and nominal GNP were to expand as fast as economic forecasters were generally projecting, an appreciable increase in the velocity of M-1 would be required. While they believed that such an increase in velocity might develop, they indicated that they would be prepared to accept M-1 growth rates that were relatively high with respect to the range if the increase in velocity fell short of the required amount. Other members stressed the importance of constraining growth in M-1 within the range specified. The member who preferred the growth range of 4Vi to 6 per cent for M-1 based his recommendation on two considerations. First, by lowering the upper limit of the range, the Committee would be providing a further indication of its resolve to resist inflationary pressures and in the process perhaps help to provide some near-term support for the dollar. Second, by raising the lower limit of the range, the Committee might offer some reassurance to those who had expressed concern that the Federal Reserve might not be sufficiently alert to the possibility of a softening in the economy later this year. Other members of the Committee took exception to this proposal. In addition to the arguments offered against a reduction in the upper limit of the M-1 range already noted, it was suggested that a narrowing of the range would imply much greater certainty than in fact existed regarding the precise rate of monetary growth appropri ate under present circumstances. In considering the longer-run growth ranges for M-2 and M-3, members took note of the sharp reduction in flows of savings to depositary institutions that had occurred during recent months. It was suggested that part of the cutback in such inflows might reflect temporary factors, and that over coming months growth in largedenomination time deposits not subject to interest rate ceilings could Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Record of Policy Actions of FOMC 299 well expand further, providing some offset to the continued slow growth expected in other deposits. It was noted that in the past the large-denomination deposit instruments of the types included in M-2 and M-3 had been issued primarily by banks, but it was suggested that in the present circumstances thrift institutions might begin to make greater use of such instruments as a source of funds. In view of these considerations, most members of the Committee were inclined to retain the existing range for M-2 and to reduce the range for M-3 by only V2 of a percentage point. The members recognized that the attainment over the coming year of growth rates for M-2 and M-3 within such ranges might require an increase in the regulatory ceilings on deposit rates. The two members who suggested some reduction in the M-2 growth range and a reduction of more than Vi of a percentage point in the M-3 range believed that under present circumstances the ranges favored by the majority were higher than those appropriately associated with a 4 to 6V2 per cent range for M-l. At the conclusion of its discussion the Committee decided to retain the existing ranges for M-l and M-2 and to reduce both the upper and lower limits of the range for M-3 by Vi of a percentage point. Thus, the new ranges, which applied to the period from the fourth quarter of 1977 to the fourth quarter of 1978, were 4 to 6V2 per cent for M-l, 6V2 to 9 per cent for M-2, and IV2 to 10 per cent for M-3. The associated range for growth in commercial bank credit remained 7 to 10 per cent. It was agreed that the longer-run ranges, as well as the particular aggregates for which such ranges were specified, would be subject to review and modification at sub sequent meetings. It was also understood that short-run factors might cause growth rates from month to month to fall outside the ranges contemplated for the year ahead. The Committee adopted the following ranges for rates of growth in monetary aggregates for the period from the fourth quarter of 1977 to the fourth quarter of 1978: M-l, 4 to 6V2 per cent; M-2, 6V2 to 9 per cent; and M-3, IV2 to 10 per cent. Votes for this action: Messrs. Burns, Volcker, Coldwell, Guffey, Jackson, Mayo, Morris, Partee, Roos, and Wallich. Votes against this action: None. Absent and not voting: Mr. Gardner. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
300 Federal Reserve Bulletin □ April 1978 In the Committee’s discussion of policy for the period im mediately ahead, it was suggested that recent developments in the foreign exchange markets militated against any marked easing of money market conditions at this time, and that the uncertainties in the economic situation militated against any marked firming. All of the members favored directing initial open market operations during the coming inter-meeting period toward the objective of maintaining the Federal funds rate at about the prevailing level of 6% per cent, and a majority preferred to continue giving greater weight than usual to money market conditions in the conduct of operations until the next meeting. With respect to the range in which the funds rate might be varied if the February-March growth rates in the monetary aggregates appeared to be deviating markedly from expectations, most members advocated retention of the 6Vi to 7 per cent range agreed upon at the January meeting. However, two members suggested narrowing the range to 6% to 7 per cent, and one proposed widening it to 6V2 to 7V4 per cent. The members did not differ greatly in their preferences for growth in the monetary aggregates for the February-March period; most favored ranges of 1 to 6 per cent for M-1 and 4Vi to 8Vi per cent for M-2. However, a few members were inclined to set the lower limit of the 2-month range for M-1 at zero, on the grounds that the acceptance of temporary weakness in the monetary aggregates that might develop from time to time would improve the chances of holding average growth over the coming year within the longer-run range agreed upon earlier in this meeting. One of these members also suggested that, given the relative volatility of M-1 and M-2, a range for M-2 that was 4 percentage points wide might best be associated with an M-1 range 6 points in width; accordingly, he favored a 2-month range of 0 to 6 per cent for M-1. Another member suggested that the ranges for both M-1 and M-2 be narrowed to 3 percentage points, in order to achieve prompter adjustment of the funds rate to growth rates in the aggregates that were unduly rapid or slow. At the conclusion of the discussion the Committee decided that operations in the period immediately ahead should continue to be directed toward maintaining prevailing money market conditions, as represented by the current 63A per cent level of the Federal funds rate. However, the members agreed that if growth in the aggregates should appear to approach or move beyond the limits of their Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Record of Policy Actions of FOMC 301 specified ranges, the operational objective for the weekly-average Federal funds rate should be varied in an orderly fashion within a range of 6V2 to 7 per cent. For the annual rates of growth in M-l and M-2 over the February-March period, the Committee specified ranges of 1 to 6 per cent and AV2 to SV2 per cent, respectively. It was understood that in assessing the behavior of the aggregates, the Manager should give approximately equal weight to the behavior of M-l and M-2. The members also agreed that in the conduct of day-to-day operations, account should be taken of emerging finan cial market conditions, including the conditions in foreign exchange markets. As customary, it was understood that the Chairman might call upon the Committee to consider the need for supplementary instruc tions before the next scheduled meeting if significant inconsistencies appeared to be developing among the Committee’s various objec tives. The following domestic policy directive was issued to the Federal Reserve Bank of New York: The information reviewed at this meeting suggests that retail sales, industrial production, and housing starts were adversely affected in January by unusually severe weather. It appears, however, that there has been little change in the underlying economic situation. Employ ment increased further in January and the unemployment rate edged down from 6.4 to 6.3 per cent. Both the consumer price index and the wholesale price index rose substantially. The index of average hourly earnings advanced sharply, as higher minimum wages became effec tive at the beginning of the year. After a period of calm, the dollar came under renewed downward pressure around mid-February, and its trade-weighted value against major foreign currencies has declined about W2 per cent. The Swiss franc and the German mark have registered the most pronounced appreciations against the dollar. M-l expanded appreciably in January but declined somewhat in early February. Growth in M-2 picked up in January, reflecting some strengthening in inflows to banks of time and savings deposits other than negotiable CD’s. Inflows to nonbank thrift institutions continued to slow. Market interest rates have changed little in recent weeks. 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 expansion and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
302 Federal Reserve Bulletin □ April 1978 help resist inflationary pressures, while contributing to a sustainable pattern of international transactions. Growth of M-1, M-2, and M-3 within ranges of 4 to 6Vi per cent, 6V2 to 9 per cent, and 7Vi to 10 per cent, respectively, from the fourth quarter of 1977 to the fourth quarter of 1978 appears to be consistent with these objectives. These ranges are subject to reconsideration at any time as conditions warrant. At this time, the Committee seeks to maintain about the prevailing money market conditions during the period immediately ahead, provided that monetary aggregates appear to be growing at approxi mately the rates currently expected, which are believed to be on a path reasonably consistent with the longer-run ranges for monetary aggregates cited in the preceding paragraph. Specifically, the Commit tee seeks to maintain the weekly-average Federal funds rate at about the current level, so long as M-l and M-2 appear to be growing over the February-March period at annual rates within ranges of 1 to 6 per cent and 4Vi to 8Vi per cent, respectively. If, giving approximately equal weight to M-l and M-2, it appears that growth rates over the 2-month period are approaching or moving beyond the limits of the indicated ranges, the operational objective for the weekly-average Federal funds rate shall be modified in an orderly fashion within a range of 6V2 to 7 per cent. In the conduct of day-to-day operations, account shall be taken of emerging financial market conditions, including the conditions in foreign exchange markets. 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, Cold well, Guffey, Jackson, Mayo, Morris, Partee, Roos, and Wallich. Votes against this action: None. Absent and not voting: Mr. Gardner. Subsequent to the meeting, on March 10, nearly final estimates indicated that in February M-l had declined and M-2 had increased relatively little. For the February-March period staff projections suggested that the annual rate of growth in M-1 would be below the lower limit of the 1 to 6 per cent range specified by the Committee in the next-to-last paragraph of the domestic policy directive issued at the February meeting. Growth in M-2 for the 2-month period was projected to be close to the lower limit of the Committee’s range of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Record of Policy Actions of FOMC 303 W2 to 8Vi per cent for that aggregate. It appeared, however, that the weakness in the aggregates might reflect the prolongation of the coal strike and the severe winter weather and, therefore, might prove to be temporary. During recent weeks the Federal funds rate had averaged about 63A per cent. In light of the behavior of the aggregates, the Manager would, under normal circumstances, have sought to reduce the funds rate within its specified range of 6V2 to 7 per cent. Against that background, and in view of recent developments in foreign exchange markets, Chairman Miller recommended at a telephone conference meeting on March 10 that the Manager be instructed to continue aiming at a Federal funds rate of 6% per cent for the time being. On March 10, 1978, the Committee modified the domestic policy directive adopted at its meeting of February 28, 1978, to call for open market operations directed at maintaining the Federal funds rate at about the prevailing level of 63A per cent for the time being. Votes for this action: Messrs. Miller, Volcker, Burns, Coldwell, Eastburn, Jackson, Wallich, Willes, Winn, and Kimbrel. Votes against this action: None. Absent and not voting: Messrs. Baughman, Gardner, and Partee. (Mr. Kimbrel voted as alternate for Mr. Baughman.) 2. Authorization for Foreign Currency Operations Paragraph ID of the Committee’s authorization for foreign currency operations authorizes the Federal Reserve Bank of New York for the System Open Market Account to maintain an over-all open position in all foreign currencies not exceeding $1.0 billion, unless a larger position is expressly authorized by the Committee. On January 17, 1978, the Committee had authorized an open position of $1.75 billion. At the meeting on February 28 the Committee authorized an open position of $2.0 billion. This action was taken in view of the scale of recent and potential Federal Reserve operations in the foreign exchange markets undertaken pursuant to the Committee’s foreign currency directive. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
304 Federal Reserve Bulletin □ April 1978 Votes for this action: Messrs. Burns, Volcker, Coldwell, Guffey, Jackson, Mayo, Morris, Partee, Roos, and Wallich. Votes against this action: None. Absent and not voting: Mr. Gardner. On March 10, following the telephone conference held on that day, Committee members voted to approve a delegation of authority to Chairman Miller to negotiate an increase in the System’s swap arrangement with the German Federal Bank of an amount up to $2 billion if he determined that the detailed arrangements were satisfac tory. The Committee also voted to approve a concurrent amendment to paragraph 2 of the authorization for foreign currency operations to raise correspondingly the amount specified there for the swap arrangement with the German Federal Bank. The Chairman ap proved an increase of $2 billion on March 11. Accordingly, para graph 2 of the authorization was amended, effective on that date, to read as follows: The Federal Open Market Committee directs the Federal Reserve Bank of New York to maintain reciprocal currency arrangements (“swap” arrangements) for the System Open Market Account for periods up to a maximum of 12 months with the following foreign banks, which are among those designated by the Board of Governors of the Federal Reserve System under Section 214.5 of Regulation N, Relations with Foreign Banks and Bankers, and with the approval of the Committee to renew such arrangements on maturity: Amount of arrangement Foreign bank (millions of dollars equivalent) Austrian National Bank .. 250 National Bank of Belgium 1,000 Bank of Canada.................. 2,000 National Bank of Denmark 250 Bank of England ................ 3,000 Bank of France ......... 2,000 German Federal Bank 4.000 Bank of Italy .. 3.000 Bank of Japan , 2.000 Bank of Mexico 360 Netherlands Bank 500 Bank of Norway 250 Bank of Sweden 300 Swiss National Bank 1,400 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Record of Policy Actions of FOMC 305 Amount of arrangement Foreign bank (millions of dollars equivalent) Bank for International Settlements: Dollars against Swiss francs ............. 600 Dollars against authorized European currencies other than Swiss francs 1,250 Votes for this action: Messrs. Miller, Volcker, Burns, Coldwell, Eastburn, Jackson, Partee, Wal lich, Willes, Winn, and Kimbrel. Votes against this action: None. Absent and not voting: Messrs. Baughman and Gardner. (Mr. Kimbrel voted as alternate for Mr. Baughman.) This action, which enlarged the System’s swap network with 14 central banks and the Bank for International Settlements to $22.16 billion, was taken as part of the cooperative effort announced on March 13 by U.S. Secretary of the Treasury Blumenthal and Minister Matthoefer of the Federal Republic of Germany. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
306 Law Department Statutes, regulations, interpretations, and decisions EQUAL CREDIT OPPORTUNITY BANK HOLDING COMPANIES The Board of Governors has amended its Regula The Board of Governors has amended its Regula tion B to clarify the definition of adverse action and tion Y to require bank holding companies authorized limit the cases in which failures or refusals to by the Board to conduct municipal securities dealer authorize an account transaction at point of sale or activities to file with the Board information about loan constitute adverse action for purposes of the persons who are associated with them as municipal regulations’s notification requirements. securities principals or municipal securities repre Effective March 13, 1978, section 202.2 is amend sentatives. ed as follows: Effective April 5, 1978 section 225.5 is amended by adding a new paragraph (f) to read as set forth Section 202.2— below: Definitions and Rules of Construction Section 225.5—Administration * * * * * (c) Adverse action. (1) For the purpose of notifi cation of action taken, statement of reasons for (f) Bank holding companies, certain of their denial, and record retention, the term means: subsidiaries, and subsidiaries, departments or divi (1) a refusal to grant credit in substantially the sions of such subsidiaries, which are municipal amount or on substantially the terms requested in securities dealers. an application unless the creditor offers to grant (1) For purposes of this paragraph, the terms credit other than in substantially the amount or on herein have the meanings given them in section 3(a) substantially the terms requested by the applicant of the Securities Exchange Act of 1934 (15 U.S.C. and the applicant uses or expressly accepts the § 78(a)) and the rules of the Municipal Securities credit offered; or Rulemaking Board. The term Act shall mean the Securities Exchange Act of 1934 (15 U.S.C. § 78a et seq.). (2) The term does not include: (2) A bank holding company, or a subsidiary of a bank holding company which is a bank (other than a national bank or a bank operating under the Code of (iii) a refusal or failure to authorize an account Law for the District of Columbia or a bank insured transaction at a point of sale or loan, except when by the Federal Deposit Insurance Corporation), or the refusal is a termination or an unfavorable a subsidiary or a department or a division of such a change in the terms of an account that does not subsidiary, which is a municipal securities dealer affect all or a substantial portion of a classification shall not permit a person to be associated with it as of the creditor’s accounts or when the refusal is a a municipal securities principal or municipal securi denial of an application to increase the amount of ties representative unless it has filed with the Board credit available under the account; or an original and two copies of Form MSD-4, “Uni form Application for Municipal Securities Principal or Municipal Securities Representative Associated (3) An action that falls within the definition of with a Bank Municipal Securities Dealer,” com both subsections (c)(1) and (c)(2) shall be governed pleted in accordance with the instructions con by the provisions of subsection (c)(2). tained therein, for that person. Form MSD-4 is prescribed by the Board for purposes of paragraph (b) of Municipal Securities Rulemaking Board rule Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 307 G-7, “Information Concerning Associated Per (5) A municipal securities dealer which files a sons.” Form MSD-4, Form MSD-5, or statement with the (3) Whenever a municipal securities dealer re Board under this paragraph shall retain a copy of ceives a statement pursuant to paragraph (c) of each such Form MSD-4, Form MSD-5 or statement Municipal Securities Rulemaking Board Rule G-7, until at least three years after the termination of the “Information Concerning Associated Persons,” employment or other association with such dealer from a person for whom it has filed a Form MSD-4 of the municipal securities principal or municipal with the Board pursuant to subparagraph (2) of this securities representative to whom the form or paragraph, such dealer shall, within ten days there statement relates. after, file three copies of that statement with the Board accompanied by an original and two copies (6) The date that the Board receives a Form of a transmittal letter which includes the name of MSD-4, Form MSD-5, or statement filed with the the dealer and a reference to the material transmit Board under this paragraph shall be the date of ted identifying the person involved and is signed by filing. Such a Form MSD-4, Form MSD-5, or a municipal securities principal associated with the statement which is not prepared and executed in dealer. accordance with the applicable requirements may (4) Within thirty days after the termination of the be returned as unacceptable for filing. Acceptance association of a municipal securities principal or for filing shall not constitute any finding that a Form municipal securities representative with a munici MSD-4, Form MSD-5, or statement has been com pal securities dealer which has filed a Form MSD-4 pleted in accordance with the applicable require with the Board for that person pursuant to subpara ments or that any information reported therein is graph (2) of this paragraph, such dealer shall file an true, current, complete, or not misleading. Every original and two copies of a notification of termina Form MSD-4, Form MSD-5, or statement filed with tion with the Board on Form MSD-5, “Uniform the Board under this paragraph shall constitute a Termination Notice for Municipal Securities Prin filing with the Securities and Exchange Commis cipal or Municipal Securities Representative As sion for purposes of section 17(c)(1) of the Act (15 sociated with a Bank Municipal Securities Dealer,” U.S.C. section 78q(c)(l) and a “report,” “applica completed in accordance with the instructions con tion,” or “document” within the meaning of sec tained therein. tion 32(a) of the Act (15 U.S.C. 78ff(a)). BANK HOLDING COMPANY AND BANK MERGER ORDERS ISSUED BY THE BOARD OF GOVERNORS Orders Under Section 3 Notice of the application, affording opportunity of Bank Holding Company Act for interested persons to submit comments and views, has been given in accordance with § 3(b) of the Act. The time for filing comments and views has ACORN FINANCIAL Corp., expired, and the Board has considered the applica Oak Park, Illinois tion and all comments received in light of the factors set forth in § 3(c) of the Act (12 U.S.C. Order Approving § 1842(c)). Formation of Bank Holding Company Applicant, a nonoperating corporation with no subsidiaries, was organized for the purpose of be ACORN FINANCIAL CORP., Oak Park, Il coming a bank holding company by acquiring Bank linois, has applied for the Board’s approval under (deposits of $55.4 million).1 Upon acquisition of § 3(a)(1) of the Bank Holding Company Act (12 Bank, Applicant will control the 189th largest bank U.S.C. § 1842(a)(1)) of formation of a bank holding in Illinois, with approximately 0.09 per cent of total company by acquiring 80 per cent or more of the deposits in commercial banks in the State. voting shares of Suburban Trust and Savings Bank, Oak Park, Illinois (“Bank”). lA\\ banking data are as of December 31, 1976. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
308 Federal Reserve Bulletin □ April 1978 Bank is the 124th largest banking institution in Calcon Bancshares, Inc., the relevant market,2 holding approximately 0.13 Callao, Missouri per cent of total deposits in commercial banks in Order Denying that market. Since Applicant has no other banking Formation of Bank Holding Company subsidiaries and Applicant’s principals do not con trol any other banks, consummation of the proposal Calcon Bancshares, Inc., Callao, Missouri, has would not have any adverse effects upon either applied for the Board’s approval under section existing or potential competition nor would it in 3(a)(1) of the Bank Holding Company Act (12 crease the concentration of banking resources in U.S.C. § 1842(a)(1)) of formation of a bank holding any relevant area. Thus, the Board concludes that company through acquisition of more than 80 per the competitive effects of the proposal are consis cent of the voting shares of Callao Community tent with approval of the application. Bank, Callao, Missouri (“Bank”). The factors that The financial resources and future prospects of are considered in acting on this application are set Applicant, which are dependent upon those of forth in section 3(c) of the Act (12 U.S.C. Bank, appear satisfactory and are regarded as being § 1842(c)). Applicant has also applied, pursuant to consistent with approval of the application to be section 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) come a bank holding company. The debt to be and section 225.4(b)(2) of the Board’s Regulation Y incurred by Applicant in connection with this pro (12 C.F.R. § 225.4(b)(2)),for permission to acquire posal appears to be serviceable without having an S & D Insurance Agency, Callao, Missouri adverse effect on the financial condition of Bank. (“Agency”), and thereby engage in the sale, as Based on the record, the Board also concludes that agent, of credit life and credit accident and health Applicant’s and Bank’s managerial resources are insurance directly related to extensions of credit by satisfactory. Therefore, considerations relating to Bank. Such activities have been determined by the banking factors are regarded as being consistent Board to be closely related to banking (12 C.F.R. with approval. § 225.4(a)(9)(ii)(a)). While no major changes are contemplated in Notice of the applications, affording opportunity Bank’s services, considerations relating to con for interested persons to submit comments and venience and needs of the community to be served views, has been given in accordance with sections 3 are consistent with approval. Accordingly, it is the and 4 of the Act (42 Fed. Reg. 62.047 (1977)). The Board’s judgment that Applicant’s proposal to form time for filing comments and views has expired, and a bank holding company would be consistent with the Board has considered the application to acquire the public interest and the application should be Bank and all comments received in light of the approved. factors set forth in section 3(c) of the Act (12 On the basis of the record, the application is U.S.C. § 1842(c)). approved for the reasons summarized above. The Applicant is a nonoperating corporation or transaction shall not be made (a) before the thirtieth ganized for the purpose of becoming a bank holding calendar day following the effective date of this company by acquiring Bank ($4.9 million in de Order or (b) later than three months after the posits).1 Upon acquisition of Bank, Applicant effective date of this Order, unless such period is would control one of the smallest banking organiza extended for good cause by the Board, or by the tions in Missouri, holding approximately 0.03 per Federal Reserve Bank of Chicago pursuant to dele cent of total deposits in commercial banks in the gated authority. State. Bank is the smallest of five banks located in By order of the Board of Governors, effective the Macon County banking market,2 and holds March 9, 1978. approximately 8.2 per cent of the total deposits in Voting for this action: Governors Wallich, Coldwell, commercial banks in the market. Since Applicant Jackson, and Partee. Absent and not voting: Chairman has no other banking subsidiaries and Applicant’s Burns and Governors Gardner and Lilly. Chairman Miller principals do not control any other banks, con was not a member of the Board at the time of its action summation of the proposal would not have any on this application. adverse effects upon existing or potential competi tion, nor would it increase the concentration of (Signed) Theodore E. A llison, banking resources in the relevant market. There- [seal] Secretary of the Board. 2The Chicago banking market, the relevant market, is approxi- *A11 banking data are as of June 30, 1977. mated by Cook and DuPage Counties, and the southern portion of 2The relevant banking market is approximated by Macon Lake County, Illinois. County, Missouri. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 309 fore, the Board concludes that competitive con at Bank. This is the case even if Applicant’s projec siderations are consistent with approval of the tions of earnings for Agency and of tax savings are application to acquire Bank. accepted, and despite slight improvements in The Board has indicated on previous occasions Bank’s earnings for the years ending 1975 through that a holding company should serve as a source of 1977. Inasmuch as the Board does not view Appli financial and managerial strength to its subsidiary cant’s overall financial plan as one that would bank, and that the Board will closely examine the enable it to serve as a source of strength to Bank or condition of an applicant in each case with this one that would preserve Bank’s future prospects, consideration in mind.3 Having examined such fac the Board concludes that considerations relating to tors in light of the record in the application to financial resources and future prospects weigh acquire Bank, the Board concludes that the record against approval of the application to acquire Bank. presents adverse considerations related to Appli Applicant’s managerial resources appear to be cant that warrant denial of the proposal to place the satisfactory but are insufficient to outweigh the ownership of Bank into corporate form. adverse factors previously mentioned. With respect to financial and managerial con No significant changes in Bank’s operations or in siderations, the Board notes that Applicant would the services offered to customers are anticipated to incur a sizable debt in connection with the proposed follow from consummation of the proposed acquisi acquisition of Bank’s shares, as have, in addition, tion. Thus, convenience and needs factors lend no Applicant’s shareholders. Applicant’s two share weight toward approval of the application to form a holders are also the principal shareholders of Bank, bank holding company. having acquired control of Bank in anticipation of On the basis of the circumstances concerning the later placing the ownership of Bank into a corpora application to acquire Bank, the Board concludes tion. Applicant proposes to service its acquisition that the banking considerations involved in this debt, and its shareholders propose to service their proposal present adverse factors bearing upon the acquisition debt, over a 12-year period through financial resources and future prospects of Appli dividends to be declared by Bank, the tax benefits cant and Bank. Such adverse factors are not out associated with the holding company structure, weighed by any procompetitive effects, Applicant’s insurance income from Agency, and salaries and satisfactory managerial resources, or by benefits directors’ fees payable to Applicant’s shareholders, that would result in Bank better serving the con who will also be officers and directors of Bank. venience and needs of the community. Accord The earnings growth for Bank as projected in the ingly, it is the Board’s judgment that approval of the application is substantially greater than Bank has application to acquire Bank would not be in the generally experienced in the past. Similarly, Appli public interest and that the application should be cant’s projections of Bank’s asset growth and the denied. associated need for additional capital for Bank On the basis of the facts of record, the application appear to be unreasonably low. Based on a review to form a bank holding company is denied for the of more realistic projections, derived from Bank’s reasons summarized above. Further consideration past performance and data from area banks, it of the application to acquire Agency is not neces appears unlikely that Bank’s actual earnings will be sary since the Board’s prior approval in that case is sufficient to enable Applicant and its shareholders required only if Agency is to be acquired by a bank to service their debts while still maintaining holding company. adequate capital at Bank, and to have the flexibility By order of the Board of Governors, effective to meet any unexpected problems that might arise March 2, 1978. 3The Bank Holding Company Act requires that the Board, in acting on an application to acquire a bank, inquire into the Voting for this action: Governors Wallich, Coldwell, financial and managerial resources of an applicant. While this proposal involves the transfer of the ownership of Bank from Jackson, and Partee. Absent and not voting: Chairman individuals to a corporation owned by the same individuals, the Burns and Governors Gardner and Lilly. Act requires that before an organization is permitted to become a bank holding company and thus obtain the benefits associated with the holding company structure, it must secure the Board’s approval. Section 3(c) of the Act provides that the Board must, in every case, consider, among other things, the financial and managerial resources of both the applicant company and the bank (Signed) G riffith L. Garwood, to be acquired. The Board’s action in this case is based on a consideration of such factors. [seal] Deputy Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
310 Federal Reserve Bulletin □ April 1978 Dakota Bankshares, Inc., the relevant market.5 The bank, First State Bank, Fargo, North Dakota Buffalo, North Dakota, holds deposits of approxi mately $3.4 million, representing 0.6 per cent of the Order Denying market’s deposits, and is the smallest bank located Formation of Bank Holding Company in the relevant market. In view of the size of banks Dakota Bankshares, Inc., Fargo, North Dakota involved and the number of competitors in the (“Applicant”), has applied for the Board’s ap market, it does not appear that consummation of proval under section 3(a)(1) of the Bank Holding the subject proposal would have any significant Company Act (12 U.S.C. § 1842(a)(1)) (“Act”), of adverse effects on competition or further an undue formation of a bank holding company by acquiring concentration of banking resources in any relevant 90 per cent or more of the voting shares of The area. Thus, the Board finds that competitive con Dakota National Bank and Trust Company of siderations are consistent with approval of the Fargo, Fargo, North Dakota (“Bank”).1 application. Notice of the application, affording opportunity As the Board has indicated on previous occa for interested persons to submit comments and sions, a holding company should constitute a views, has been given in accordance with section source of financial and managerial strength to its 3(b) of the Act. The time for filing comments and subsidiary bank(s) and the Board closely examines views has expired, and the Board has considered the condition of an applicant with this consideration the application and all comments received, in light in mind.6 With regard to financial considerations, of the factors set forth in section 3(c) of the Act the Board notes that, while Bank’s financial condi 12 U.S.C. § 1842(c)).2 tion is considered satisfactory, Applicant would Applicant, a nonoperating corporation with no assume a sizable debt in connection with the pro subsidiaries, was organized for the purpose of be posed acquisition of Bank’s shares. Applicant pro coming a bank holding company through the acqui poses to service this debt over a 12-year period with sition of Bank. Bank holds deposits of approxi dividends to be paid by Bank and tax benefits to be mately $68.2 million, representing 2.25 per cent of derived from filing consolidated tax returns. The total commercial bank deposits in North Dakota.3 Board is of the view that Applicant’s projected Upon acquisition of Bank, Applicant would become income is not sufficient to service its acquisition the sixth largest banking organization in the State. debt without adversely affecting the capital position Bank controls 12.7 per cent of total deposits in of Bank. Moreover, the level of dividend payout commercial banks in the relevant banking market, from Bank does not provide Applicant with the making it the third largest of 23 banking organiza financial flexibility to meet any unexpected prob tions in the market.4 The subject proposal is essen lems that might arise at Bank. Thus, the Board tially a restructuring of Bank’s ownership into cannot conclude that Applicant’s overall financial corporate form. However, in order to analyze the plan would enable Applicant to serve as a source of competitive effects of the subject proposal, it is financial strength for Bank should it become neces necessary to consider that one of Applicant’s prin sary. cipals is also a principal of another bank located in With respect to managerial resources,7 the Board ‘In conjunction with this application, two registered bank 5This principal also holds interests in two other banks, both of holding companies, Otto Bremer Foundation (“Foundation”) and which are located outside the relevant banking market. It does not its wholly-owned subsidiary, Otto Bremer Company (“Com appear that there is any meaningful competition between either of pany”), both of St. Paul, Minnesota, have applied for the Board’s those two banks and Bank. approval under section 3(a)(3) of the Act to acquire shares of 6While this proposal involves the restructuring of Bank’s Applicant. Foundation indirectly owns, through Company, 21.77 ownership into a corporate form, the Bank Holding Company Act per cent of the outstanding voting shares of Bank. requires that an organization must secure the Board’s approval 2The Board has received comments in opposition to the subject prior to becoming a bank holding company. Section 3(c) of the Act proposal from David G. Hammel of Sherborn, Massachusetts provides that the Board must consider, among other things, the (“Protestant”), a shareholder of Bank. In summary, Protestant financial and managerial resources and future prospects of both alleges that the management practices of certain of Applicant’s the applicant and the bank to be acquired. The Board’s action in principals would work to the detriment of minority shareholders of this case is based on a consideration of such factors. Bank. In view of the decision in Western Bancshares v. Board of 7The Board has previously stated that in considering an applica Governors, 480 F. 2d 749 (10th Cir. 1973), and the Board’s denial tion involving a bank whose principals control another bank or of the subject application for the reasons set forth herein, it is bank holding company, it should look beyond the bank that is the unnecessary for the Board to make findings with respect to subject of the application and analyze the financial and managerial Protestant’s allegations. resources of the other bank or bank holding company. (See 3All banking data are as of September 30, 1977. Board’s Order of June 14, 1976, denying formation of a bank 4The relevant banking market is approximated by Cass County, holding company by Nebraska Banco, Inc., Ord, Nebraska, 62 North Dakota, and Clay County, Minnesota. Federal Reserve Bulletin 638 (1976)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 311 notes that one of Applicant’s principals holds inter Voting for this action: Governors Wallich, Coldwell, ests in three one-bank holding companies. This Jackson, and Partee. Absent and not voting: Chairman Burns and Governors Gardner and Lilly. Chairman Miller principal, in acquiring control over one of those was not a member of the Board at the time of its action on holding companies, engaged in practices that ad this application. versely affected the capital of that holding com pany. Although Bank’s managerial resources ap (Signed) Theodore E. A llison, pear to be satisfactory, the Board is unable to [seal] Secretary of the Board. conclude that the facts of record support a finding that Applicant’s principals have demonstrated a history of satisfactory managerial performance that First National Bank Shares, Ltd., would justify a finding that Applicant could serve as Great Bend, Kansas a source of managerial strength for Bank.8 There Order Denying fore, having considered the financial and manage Formation of Bank Holding Company rial resources of Applicant and Bank and the future prospects for each, the Board concludes that such First National Bank Shares, Ltd., Great Bend, considerations weigh against approval of the sub Kansas, has applied for the Board’s approval under ject proposal. § 3(a)(1) of the Bank Holding Company Act (12 As stated previously, the proposed formation of U.S.C. § 1842(a)(1)) of formation of a bank holding Applicant merely represents a restructuring of company by acquiring 80 per cent of the voting Bank’s present ownership. Applicant proposes no shares of First National Bank and Trust Company changes in Bank’s operations or services. Con in Great Bend, Great Bend, Kansas (“Bank”).1 sequently, consideration relating to the conveni Notice of the application, affording opportunity ence and needs of the community to be served lend for interested persons to submit comments and no weight toward approval of the application. views, has been given in accordance with § 3(b) of Moreover, in view of Applicant’s debt servicing the Act. The time for filing comments and views has requirements, consummation of the subject trans expired, and the Board has considered the applica action could diminish Bank’s ability to continue to tion and all comments received in light of the serve the area as a viable banking alternative. factors set forth in § 3(c) of the Act (12 U.S.C. On the basis of all of the facts of record concern § 1842(c)). ing this application, the Board concludes that the Applicant, a nonoperating corporation with no banking considerations involved in this proposal subsidiaries, was organized for the purpose of be present adverse factors bearing upon the financial coming a bank holding company through the acqui and managerial resources and future prospects of sition of Bank, which holds deposits of $44.7 mil Applicant and Bank. Such adverse factors are not lion.2 Upon acquisition of Bank, Applicant would outweighed by any procompetitive effects or by control approximately 0.4 per cent of total deposits benefits that would result in better serving the in commercial banks in the State of Kansas. banking needs of the relevant community. Accord Bank is the largest of nine banking organizations ingly, it is the Board’s judgment that approval of the in the relevant banking market,3 and controls 24.9 application would not be in the public interest and per cent of total market deposits. While two of that the application should be denied. Applicant’s principals are also principals in several On the basis of the facts of record, the application other banking organizations in Kansas, none of is denied for the reasons summarized above.9 these banking organizations compete in the relevant banking market, and it appears that no meaningful competition would be eliminated as a result of By order of the Board of Governors, effective consummation of this proposal. Moreover, inas March 9, 1978. much as the proposed transaction involves the 8The Board believes that it is reasonable to expect an applicant, Applicant proposes to acquire 72.3 per cent of Bank’s outstand the principals of which are principals of another bank or bank ing shares by exchanging 25,334 shares of its stock for the same holding company, to demonstrate some history of satisfactory number of Bank’s shares. In addition, Applicant proposes to managerial performance. (See the Board’s Order of November 3, borrow approximately $1 million to acquire 16,667 shares of 1977, denying the formation of a bank holding company by 17,500 new shares to be issues by Bank. Republic Bancorporation, Inc., Englewood, Colorado, 63 Federal 2Unless stated otherwise, all banking data are as of June 30, Reserve Bulletin 1098 (1977)). 1977. 9Denial of this application renders moot the applications of 3The relevant banking market is approximated by Barton Foundation and Company. County, Kansas. 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312 Federal Reserve Bulletin □ April 1978 transfer of ownership of Bank from individuals to a application are substantially greater than Bank has corporation owned by the same individuals, it ap generally enjoyed in the past. Applicant has pro pears that consummation of this proposal would jected average earnings for Bank of 0.99 per cent of have no adverse effect upon existing or potential assets over the next twelve years, whereas Bank’s competition, nor would it increase the concentra earnings during the period from 1972 through 1976 tion of banking resources in the relevant market. averaged 0.54 per cent of assets, and its earnings in Accordingly, the Board concludes that competitive 1977 were 0.48 per cent of assets. In addition, the considerations of the instant proposal are consis asset growth projected for Bank is much less than tent with approval of the application. Bank has actually experienced in recent years. The Board has indicated on previous occasions Applicant has projected a growth of average assets that a holding company should constitute a source for Bank averaging 9.0 per cent annually over the of financial and managerial strength to its sub next twelve years, whereas Bank’s average assets sidiary bank(s) and that the Board will closely grew at an average annual rate of 17.8 per cent examine the condition of an applicant in each case during the period from 1972 through 1976, and with this consideration in mind.4 Having examined during 1977 Bank’s average asset growth was 24.8 such factors in light of the recprd in the application, per cent. In sum, the Board cannot conclude at this the Board concludes that the record presents ad time that Applicant’s overall financial plan is one verse considerations as they relate to the Applicant that would enhance Bank’s prospects. Therefore, that warrant denial of the proposal to place the the Board concludes that considerations relating to ownership of Bank into corporate form. financial resources and future prospects weigh With regard to financial considerations, the against approval of this application. Board notes that Applicant proposes to borrow With regard to managerial considerations, the approximately $1 million to acquire newly-issued Board notes that Applicant’s president, who serves shares of Bank, thereby increasing Bank’s capital. as Chairman of the Board of Bank, also serves as The Board believes that borrowing by a bank Chairman of the Board and is a principal share holding company in order to place additional capital holder in each of two other banks in Kansas.6 The in its subsidiary banks is appropriate. However, in operations and overall position of these banks have the instant case, the primary source of funds to declined in recent years and from the record it service Applicant’s debt will be dividends from appears that these results are due in part to certain Bank. Bank’s past performance of growth and policies and practices of Applicant’s president. earnings do not lend assurance that an appropriate Furthermore, the overall operations of Bank under level of capital could be maintained by Bank while the direction of Applicant’s principals are such that providing the quantity of dividends necessary to they do not support a finding that Applicant’s service Applicant’s debt. Applicant proposes to principals have demonstrated a history of manage service this debt over a 12-year period through rial performance that would warrant a favorable dividends to be declared by Bank and tax benefits finding by the Board with respect to Applicant’s to be derived from filing consolidated tax returns. and Bank’s managerial resources.7 Inasmuch as no The projected earnings5 for Bank contained in the management changes are contemplated by Appli cant and consummation of this proposal would perpetuate present management’s control of Bank, 4The Bank Holding Company Act requires that the Board, in the Board is of the view that the record indicates acting on an application to acquire a bank, inquire into the that managerial factors should be regarded as an financial and managerial resources of an applicant. While this proposal involves the transfer of the ownership of Bank from adverse consideration. Therefore, the Board conindividuals to a corporation owned by essentially the same indi viduals, the Act requires that before an organization is permitted to become a bank holding company and thus obtain the benefits associated with the holding company structure, it must secure the 6The Board has previously indicated that, in considering an Board’s approval. Section 3(c) of the Act provides that the Board application involving a bank whose principals control another must, in every case, consider, among other things, the financial bank, it should look beyond the bank that is the subject of the and managerial resources of both the applicant company and the application and analyze the financial and managerial resources of bank to be acquired. The Board’s action in this case is based on a the other bank. (See, e.g., Board’s Order dated November 21, consideration of such factors. 1977, denying the formation of a bank holding company by 5Applicant’s projections for Bank indicate that a significant Chickasha Bancshares, Inc., Chickasha, Oklahoma, 63 Federal portion of Bank’s operating income is to be derived from new Reserve Bulletin 1082 (1977)). sources, primarily from expansion of its data processing services 7The Board has previously indicated that it is reasonable to and reinstitution of charges on demand deposits. However, the expect an applicant to demonstrate a record of satisfactory Board notes that the record shows that the data processing managerial performance. (See, e.g., Board’s Order dated operations have not been profitable, and there are no assurances November 21, 1977, denying the formation of a bank holding that the reinstitution of service charges will result in financial company by Chickasha Bankshares, Inc., Chickasha, Oklahoma, benefit to Bank. note 6 supra.) 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Law Department 313 eludes that considerations relating to managerial § 225.4(b)(2) of the Board’s Regulation Y (12 CFR resources weigh against approval of this applica § 225.4(b)(2)) for permission to engage in the activ tion. ity of acting as agent for the sale of credit life and No significant changes in Bank’s operations or in credit accident and health insurance directly related the services offered to its customers are anticipated to extensions of credit by Bank. Such activity has to follow from consummation of the proposed ac been determined by the Board to be closely related quisition. Consequently, convenience and needs to banking (12 CFR § 225.4(a)(9)(ii)(a)). factors lend no weight towards approval of this Notice of these applications has been given in application. accordance with §§ 3 and 4 of the Act (42 Fed. Reg. On the basis of the circumstances concerning this 57,159 (1977)) and the time for filing comments and application, the Board concludes that the banking views has expired. The Board has considered the considerations involved in this proposal present applications and all comments received in light of adverse factors bearing upon the financial and the factors set forth in § 3(c) of the Act (12 U.S.C. managerial resources and future prospects of Ap § 1842(c)) and the considerations specified in plicant and Bank. Such adverse factors are not § 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)). outweighed by any procompetitive effects or by Applicant is a non-operating corporation or benefits that would result in better serving the ganized for the purpose of becoming a bank holding convenience and needs of the community. Accord company by acquiring Bank, which holds deposits ingly, it is the Board’s judgment that approval of the of $6.9 million.1 Upon acquisition of Bank, Appli application would not be in the public interest and cant would control the 234th largest banking or that the application should be denied. ganization in the State of Nebraska holding approx On the basis of the facts of record, the application imately 0.1 per cent of total deposits in commercial is denied for the reasons summarized above. banks in that State. Bank is the 32nd largest of 39 By Order of the Board of Governors, effective banks in the relevant market,2 controlling 0.35 per March 8, 1978. cent of the total deposits in commercial banks in the market. Voting for this action: Governors Wallich, Coldwell, Several principals of Applicant and Bank are also Jackson, and Partee. Absent and not voting: Chairman principals in 11 other one-bank holding companies Burns and Governors Gardner and Lilly. controlling nine subsidiary banks, and three banks that are not holding company subsidiaries.3 One of (Signed) G riffith L. Garwood, [seal] Deputy Secretary of the Board. these banking organizations, Clarke, Inc., Palmer Nebraska (“Clarke”), owns 96.5 per cent of Bank of Papillion, Papillion, Nebraska (“Papillion The Gretna Company, Bank”). Papillion Bank, which operates in the same Gretna, Nebraska market as Bank, has deposits of $16.6 million and controls 0.85 per cent of total deposits in commer Order Approving Formation of cial banks in the market. Given the relatively small Bank Holding Company and Performance of combined share of market deposits of 1.20 per cent, Insurance Agency Activities it is the Board’s view that this relationship would The Gretna Company, Gretna, Nebraska, has have no significantly adverse effects upon competi applied for the Board’s approval under § 3(a)(1) of tion in the relevant market. No subsidiary of the other bank holding companies with which Appli the Bank Holding Company Act (12 U.S.C. § 1842(a)(1)) of formation of a bank holding com cant’s principals are associated and none of the three independent banks operate in the relevant pany by acquiring 100 per cent of the voting shares banking market. Accordingly, consummation of the of Gretna Capital Company, Gretna, Nebraska (“Gretna Capital”), which in turn owns 80 per cent or more of the voting shares of Gretna State Bank, Gretna, Nebraska (“Bank”). After consummation XA11 banking data are as of December 31, 1976. 2The relevant market is approximated by the Omaha City of the acquisition, Gretna Capital will be liquidated Standard Metropolitan Statistical Area (“SMSA”), which in and its assets, consisting only of Bank’s shares, will cludes Douglas and Sarpy Counties in Nebraska and Pottawat be distributed to Applicant. Therefore, the pro tamie County in Iowa. 3ln an Order of February 16, 1978, the Board approved the posed acquisition of shares of Gretna Capital is application of The Weld State Company, Fort Lupton, Colorado treated herein as the proposed acquisition of the (“Weld State”) to form a twelfth affiliated bank holding company by acquiring one of the three banks currently controlled directly shares of Bank. Applicant has also applied pursuant by Applicant’s principals, The Fort Lupton State Bank, Fort to § 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and Lupton, Colorado. 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314 Federal Reserve Bulletin □ April 1978 proposed acquisition would eliminate no significant that consummation of the proposal to form a bank existing competition nor does it appear that con holding company would be consistent with the summation would eliminate potential competition public interest and that the application to do so in any market. Thus, the Board concludes that the should be approved. competitive effects of the proposal are consistent In connection with the application to become a with approval. bank holding company, Applicant has also applied, Beside applying multi-bank holding company pursuant to section 225.4(a)(9) of Regulation Y, to standards in assessing competitive effects where act as agent or broker in the sale of credit life and the principals of an applicant are engaged in estab credit accident and health insurance directly related lishing a chain of one-bank holding companies, the to extensions of credit by Bank. Approval of this Board applies multibank holding company stan application to engage in such activities would lend dards in assessing the financial and managerial assurance that a convenient source of credit-related resources and future prospects both of an applicant insurance will be available to Bank’s customers. It seeking to become a one-bank holding company, does not appear that Applicant’s engaging in the and of its proposed subsidiary bank.4 The condition above-described activities would have any signifi of the holding companies in which Applicant’s cant adverse effect on existing or potential competi principals are involved, their subsidiary banks and tion. Furthermore, there is no evidence in the the three independent banks suggests that Appli record indicating that consummation of the propo cant’s principals would conduct the operation of the sal would result in any undue concentration of proposed holding company and of Bank in a satis resources, unfair competition, conflicts of interests, factory manner. In addition, the financial and man unsound banking practices or other adverse effects agerial resources and future prospects of Applicant, on the public interest. which are largely dependent upon those of Bank, Based upon the foregoing and other con are considered generally satisfactory and consistent siderations reflected in the record, the Board has with approval of the subject application. While determined, in accordance with the provisions of Applicant will incur debt in connection with the section 4(c)(8) of the Act, that consummation of this subject proposal, this debt will be reduced signifi proposal can reasonably be expected to produce cantly through the issuance of nonvoting, non- benefits to the public that outweigh possible ad cumulative preferred stock to Clarke.5 The pro verse effects and that the application to engage in jected income from Bank and Applicant’s insurance credit-related insurance agency activities should be agency activity, as well as the benefits to be derived approved. from filing a consolidated tax return should provide Accordingly, the applications are approved for sufficient revenue to service the remaining acquisi the reasons summarized above. The acquisition of tion debt without placing an undue strain on the shares of Bank shall not be made before the thir financial condition of either Applicant or Bank. tieth calendar day following the effective date of Although consummation of the transaction would this Order. The acquisition of Bank and the com effect no changes in the banking services offered by mencement of credit-related insurance agency ac Bank, considerations relating to the convenience tivities shall be made not later than three months and needs of the community to be served are after the effective date of this Order, unless such consistent with approval. It is the Board’s judgment period is extended for good cause by the Board or by the Federal Reserve Bank of Kansas City pur suant to delegated authority. The approval of Ap plicant’s insurance activities is subject to the condi 4See the Board’s Order of June 14, 1976, denying the application of Nebraska Banco, Inc., Ord, Nebraska (62 Federal Reserve tions set forth in section 225.4(c) of Regulation Y Bulletin 638 (1976)). and to the Board’s authority to require reports by, 5These nonvoting preferred shares, as originally proposed, were and make examinations of, holding companies and to be convertible into voting preferred shares in the hands of other persons. However, Applicant has committed to eliminate the their subsidiaries and to require such modification convertibility feature of the preferred shares so that these shares or termination of the activities of a bank holding will not be convertible under any circumstances. In addition, the Board has received a written commitment from Clarke that Clarke company or any of its subsidiaries as the Board will, subsequent to consummation of the proposal, treat Applicant finds necessary to assure compliance with the pro as a subsidiary of Clarke and comply with applicable provisions of visions and purposes of the Act and the Board’s Federal banking law, as if Applicant were a subsidiary of Clarke. In view of this commitment and the current applicability of § 23A regulations and orders issued thereunder, or to of the Federal Reserve Act to the relationships among Clarke, prevent evasion thereof. Papillion Bank, and Bank, it is not necessary to determine at this By order of the Board of Governors, effective time whether Clarke controls Applicant under § 2(a)(2)(C) of the Bank Holding Company Act. March 23, 1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 315 Voting for this action: Chairman Miller and Governors posits,3 and ranks as the fifth largest banking or Wallich, Coldwell, Jackson, and Partee. Absent and not ganization in the relevant banking market. The voting: Governors Gardner and Burns. acquisition of Bank would increase Applicant’s share of market deposits to 17.4 per cent, and Applicant would thereby become the largest bank (Signed) G riffith L. Garwood, ing organization in the market. The Board views the [seal] Deputy Secretary of the Board. effects of the proposal on concentration of banking resources in the relevant banking market as an adverse factor in its consideration of this applica tion. Those effects are regarded as more significant in light of the fact that the proposed acquisition Hawkeye Bancorporation, would increase the deposits held by the four largest Des Moines, Iowa banking organizations in the market from 49.5 per cent to 56.9 per cent of the deposits. Order Denying Acquisition of Bank In addition to having adverse effects upon the Hawkeye Bancorporation, Des Moines, Iowa, a concentration of banking resources in the relevant bank holding company within the meaning of the banking market, consummation of the proposal Bank Holding Company Act, has applied for the would eliminate existing competition between Bank Board’s approval under § 3(a)(3) of the Act (12 and Applicant’s subsidiary bank. Bank has three U.S.C. § 1842(a)(3)) to acquire all of the voting offices located within the relevant banking market, shares (less directors’ qualifying shares) of Second and the nearest office of Applicant’s subsidiary National Bank, Eldora, Iowa (“Bank”), through bank is just fifteen miles from one of Bank’s offices. the acquisition of all of the voting shares of Second Consummation of the proposal would eliminate Bancorporation, Eldora, Iowa (“Bancorpora existing competition between Applicant and Bank, tion”). and the Board regards this elimination of competi Notice of the application, affording opportunity tion as an adverse factor in its consideration of the for interested persons to submit comments and instant application. Accordingly, the Board finds on views, has been given in accordance with § 3(b) of the basis of the foregoing and other facts of record the Act. The time for filing comments and views has that competitive considerations relating to this ap expired, and the Board has considered the applica plication weigh sufficiently against approval so that tion and all comments received, including those it should not be approved unless the anticompeti submitted by the Iowa Department of Banking, in tive effects are outweighed by considerations relat light of the factors set forth in § 3(c) of the Act (12 ing to the convenience and needs of the community U.S.C. § 1842(c)). to be served. Applicant, the third largest banking organization The financial and managerial resources of Appli in Iowa, controls 17 banks with aggregate deposits cant and its subsidiaries are regarded as satisfac of approximately $559.9 million, representing 4.2 tory. Those of Bank are regarded as generally per cent of total deposits in commercial banks in satisfactory. Accordingly, considerations relating Iowa.1 Acquisition of Bank, with deposits of $12.8 to banking factors are consistent with approval of million, would increase Applicant’s share of com the application. While Applicant proposes to assist mercial bank deposits in Iowa by one-tenth of 1 per Bank in offering additional services, such as farm cent and would not have an appreciable effect upon management, investment advice and data process the concentration of banking resources in the State. ing, there is no indication that the needs of Bank’s Bank is the sixth largest of 12 commercial bank customers are not currently being met, that the ing organizations in the relevant banking market2 proposed new services cannot be obtained and controls 7.5 per cent of deposits in commercial banks in the market. Applicant, with one subsidiary bank in the market, controls deposits of $16.8 3In its Order of August 23, 1973 approving Applicant’s acquisi million, representing 9.9 per cent of market de tion of Farmers Savings Bank, Grundy Center, Iowa (“Farmers”) (38 Fed. Reg. 23560 (1973)), the Board’s definition of the Grundy Center banking market was similar to that relied upon in the instant application. Applicant now maintains that Bank and Farmers are located in separate banking markets, while it had 1 Unless otherwise indicated, banking data are as of June 30, placed both banks in the Grundy Center banking market in its 1977. application to acquire Farmers. Based on the facts of record, the 2The relevant banking market is approximated by Grundy Board has concluded that Bank and Farmers are both located County and adjoining portions of Hardin, Butler and Tama Coun within the Grundy Center banking market as defined herein ties, Iowa. (footnote 2 supra). 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316 Federal Reserve Bulletin □ April 1978 elsewhere in the relevant banking market, or that mercial banks in the State.1 Upon consummation of Applicant could not offer such services through its this proposal, Bank would purchase the assets and present subsidiary bank in the market. Accord assume the liabilities of the four Port Huron ingly, the Board finds that considerations relating to branches of MNC’s largest subsidiary bank, Michi convenience and needs of the community to be gan National Bank (Lansing). Accordingly, acquisi served do not outweigh the adverse competitive tion of Bank by MNC would not increase MNC’s effects that would result from Applicant’s acquisi share of commercial bank deposits in Michigan or tion of Bank. the concentration of banking resources in that On the basis of the facts in the record, and in light State. of the factors set forth in § 3(c) of the Act, it is the Bank is to be located in the St. Clair County Board’s judgment that approval of the proposal banking market, the relevant banking market.2 would not be in the public interest. Accordingly, MNC is the largest banking organization in the the application is denied for the reasons sum relevant market, the four branches of Michigan marized herein. National Bank (Lansing) holding approximately By Order of the Board of Governors, effective 43.1 per cent of the total deposits in commercial March 7, 1978. banking institutions in the market. Michigan Na tional Bank (Lansing) is presently prohibited from Voting for this action: Governors Wallich, Coldwell, branching further in Port Huron. Bank, as a sepa Jackson, and Partee. Absent and not voting: Chairman Burns and Governors Gardner and Lilly. rately chartered bank, would be allowed full branching privileges in Port Huron, however. Since (Signed) G riffith L. Garwood, Bank is a proposed new bank, and would acquire [seal] Deputy Secretary of the Board. the assets and liabilities of four branches of a bank now controlled by MNC, consummation of the proposed acquisition would not eliminate any exist ing competition, nor would it immediately increase the concentration of banking resources in the rele vant market. Accordingly, on the basis of the facts of record, the Board concludes that competitive considerations are consistent with approval of the Michigan National Corporation, application. Bloomfield Hills, Michigan The financial and managerial resources of MNC and its subsidiary banks are regarded as generally Order Approving Acquisition of Bank satisfactory, particularly in view of MNC’s plans to inject capital into, and retain earnings from, certain Michigan National Corporation, Bloomfield of its subsidiary banks.3 Given MNC’s satisfactory Hills, Michigan (“MNC”), a bank holding company management, favorable earnings and expected within the meaning of the Bank Holding Company strengthening of financial resources, MNC’s future Act, has applied for the Board’s approval under prospects appear favorable. Bank itself has no § 3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to operating history; however, based upon its planned acquire all of the voting shares (less directors’ management, capitalization, projected earnings, qualifying shares) of Michigan National Bank-Port and the operating history of the four Port Huron Huron, Port Huron, Michigan (“Bank”), a pro branches of Michigan National Bank (Lansing), posed new bank. Bank’s future prospects as a subsidiary of MNC Notice of the application, affording opportunity appear favorable. Thus, considerations relating to for interested persons to submit comments and banking factors are consistent with approval of the views, has been given in accordance with § 3(b) of the Act. The time for filing comments and views has expired, and the Board has considered the applica *A11 banking data, unless otherwise indicated, are as of June 30, tion and all comments received in light of the 1977. By Order of January 31, 1978, the Board approved MNC’s acquisition of its 17th bank, Michigan National Bank-Sterling, factors set forth in § 3(c) of the Act (12 U.S.C. Sterling Heights, Michigan. § 1842(c)). 2The St. Clair County banking market is approximated by St. MNC, the second largest commercial banking Clair County, Michigan, minus the western tier of townships and the three southernmost townships in that County. organization in Michigan, controls 16 banks with 3MNC added $6.2 million to the capital accounts of various aggregate deposits of approximately $3.4 billion, subsidiary banks during 1977 and has indicated its intention to representing 10.3 per cent of the deposits in com place substantially more capital in the accounts of certain other subsidiary banks during 1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 317 application. Although MNC will make no signifi (Signed) Theodore E. A llison, cant changes in the services to be offered by Bank [seal] Secretary of the Board. from those now offered by the four branches, considerations relating to the convenience and needs of the community to be served are consistent with approval of the application. The Board’s Order of January 31, 1978, approv Midwest Bancorp, Inc., ing MNC’s acquisition of Michigan National Gardner, Illinois Bank-Sterling, Sterling Heights, Michigan involved an analysis of the “accommodation transaction Order Denying services” (“ATS”) program established and oper Formation of a Bank Holding Company ated among MNC’s subsidiary banks and planned to be instituted at Bank. Under this program, a Midwest Bancorp, Inc., Gardner, Illinois, has customer of an MNC subsidiary bank (the “bank of applied for the Board’s approval under section record”) may, at the location of any of the other 3(a)(1) of the Bank Holding Company Act (12 MNC subsidiary banks or their branches (the “ac U.S.C. § 1842(a)(1)) of formation of a bank holding commodating bank”), effect a deposit to, or with company by acquiring 88.4 per cent or more of the drawal from, any account maintained at the cus voting shares of Exchange Bank, Gardner, Illinois tomer’s MNC bank of record, or effect payments (“Bank”). on any mortgage or instalment loan extended to the Notice of the application, affording opportunity customer by the customer’s bank of record. After for interested persons to submit comments and considering all of the submissions received by the views, has been given in accordance with section Board regarding the ATS system and the Sterling 3(b) of the Act. The time for filing comments and Bank application, the Board concluded that the views has expired, and the Board has considered ATS program constituted branch banking and that the application and all comments received in light of the provisions of the National Bank Act (12 U.S.C. the factors set forth in section 3(c) of the Act (12 § 36) made such branch banking illegal in Michigan. U.S.C. § 1842(c)). Accordingly, although the Board has determined Applicant, a nonoperating corporation with no that approval of the application to acquire Bank subsidiaries, was organized for the purpose of be would be in the public interest and that the ap coming a bank holding company by acquiring Bank. plication should be approved, consistent with the Upon acquisition of Bank, Applicant would control previous Board decision on the Sterling Bank ap the 939th largest commercial bank in Illinois, with plication, Bank may not engage in MNC’s ATS 0.01 per cent of the total commercial bank deposits program. in the State.1 On the basis of the record in this case and for the Bank holds deposits of approximately $8.6 mil reasons summarized above, the application is ap lion, representing 4.7 per cent of total deposits in proved on the condition that ATS services not be commercial banks in the Grundy County banking offered at Bank or to any of Bank’s customers by market, and is the smallest of eight banks located in any other MNC bank. The transaction shall not be the market.2 The subject proposal involves a re made (a) before the thirtieth calendar day following structuring of Bank’s ownership from individuals to the effective date of this Order nor (b) later than three months after that date, and (c) Bank shall be opened for business not later than six months after the effective date of this Order. Each of the periods 1A11 banking data are as of June 30, 1977, unless otherwise noted. described in (b) and (c) may be extended for good 2The relevant banking market for the purposes of analyzing the cause by the Board, or by the Federal Reserve competitive effects of the proposed transaction is approximated Bank of Chicago pursuant to delegated authority. by the portion of Grundy County south of the Illinois River, the southwestern-most portion of Will County, and the northwestern By order of the Board of Governors, effective portion of Kankakee County, all in Illinois. Applicant contends March 9, 1978. that the relevant market should include also the banks located in the villages of Dwight, Campus, and Herscher. The Federal Reserve Bank of Chicago and Board staff have thoroughly re viewed and analyzed all facts of record relating to the definition of the relevant market. As a result of this review and its analysis of Voting for this action: Governors Wallich, Coldwell, all facts of record, including commuting data, advertising and Jackson, and Partee. Absent and not voting: Chairman communications patterns, and consumer trade information, the Burns and Governors Gardner and Lilly. Chairman Miller Board concludes that the appropriate market for analyzing the was not a member of the Board at the time of its action on competitive effects of the subject proposal is approximated by the this application. Grundy County banking market as described above. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
318 Federal Reserve Bulletin □ April 1978 a corporation owned by those same individuals. effect of Bank’s acquisition by Applicant’s princi The facts of record indicate that, in addition to pals was to eliminate significant competition that Bank, Applicant’s principals hold significant voting existed at that time between Bank and the two other share interests in two of the seven other banks banks, increase the concentration of banking re located within the Grundy County banking market.3 sources within the Grundy County banking market, In addition, certain of Applicant’s principals serve and eliminate an independent banking competitor in as officers and/or directors of these two other the market. banks. The two banks, First National Bank of In the Board’s view, the subject proposal in Morris (“Morris Bank”) and State Bank of Braid- volves the use of the holding company form to wood (“Braidwood Bank”), hold aggregate de further an anticompetitive arrangement. On the posits of approximately $58.9 million, representing basis of all the facts of record, including the sizes of 32.6 per cent of the market total deposits, and rank the organizations involved, and their collective as the largest and seventh largest banks in the position in the relevant market (together the three relevant market, respectively. banks hold 37.3 per cent of the market’s total Under section 3(c) of the Bank Holding Company commercial bank deposits), the Board concludes Act, the Board is precluded from approving any that approval of this proposal would have signifi proposed acquisition of a bank that, in any part of cant adverse competitive effects. Accordingly, the country, (1) would result in a monopoly, or under the standards set forth in the Bank Holding would be in furtherance of any combination or Company Act, the proposal may not be approved conspiracy to monopolize or attempt to monopolize unless the adverse competitive factors are clearly the business of banking; or that (2) may substan outweighed by other public interest considerations tially lessen competition or tend to create a reflected in the record. monopoly or be in restraint of trade, unless the The financial and managerial resources and fu Board finds that such anticompetitive effects are ture prospects of Applicant, which are primarily clearly outweighed in the public interest by the dependent upon Bank, are considered satisfactory proposal meeting the convenience and needs of the and generally consistent with approval of the sub community to be served. ject application. Therefore, considerations relating As part of its analysis of the competitive effects to banking factors are consistent with, but lend no of a proposal involving the restructuring of a bank’s weight in favor of approval of the application. ownership into corporate form, the Board takes Applicant plans to offer some additional services to into consideration the competitive effects of the Bank’s customers. The Board finds that con transaction(s) whereby common share ownership siderations relating to the convenience and needs of and/or an interlocking director/officer relationship the community to be served lend some weight were established between the subject bank and one toward approval, but, in the Board’s view, do not or more other banks in the same market.4 In this outweigh the significant adverse competitive effects case, the Board has considered the competitive of the subject proposal. effects of the purchase of Bank’s shares by Appli On the basis of all of the facts of record in this cant’s principals in 1976. At that time, Applicant’s case, it is the Board’s judgment that approval of this principals held the above-described interests in application would not be in the public interest and Morris Bank and Braid wood Bank, as well as that the application should be denied. While denial served as officers and/or directors of those banks. of this proposal may not immediately alter the Together, the two banks controlled 32.4 per cent of anticompetitive relationship presently existing be the market’s deposits.5 The Board finds that the tween Bank, Morris Bank and Braidwood Bank, denial would preserve the prospect that Bank and 3It is also noted that a number of Applicant’s principals are the other two Banks would become independent associated with a group of individuals that control a total of 20 other banks in Illinois and one bank in Iowa, in addition to Bank and competing organizations in the future. On the and the two banks in the Grundy County market. However, it does other hand, approval would only serve to not appear that any significant competition currently exists be tween these other banks and Bank. strengthen and solidify the anticompetitive rela 4See the Board’s Order of May 11, 1977, denying the application tionship among the three banks and would eliminate to become a bank holding company by Mahaska Investment or significantly diminish the likelihood of the mar Company, Oskaloosa, Iowa (63 Federal Reserve Bulletin 579 (1977)); and the Board’s Order of November 18, 1977, denying the ket becoming more competitive in the future. application to become a bank holding company by Citizens On the basis of all facts of the record, and in light t B i a n n c 1 o 0 r 8 p 3 , ( I 1 n 9 c 7 . 7 , ) H ). artford City, Indiana (63 Federal Reserve Bulle of the factors set forth in section 3(c) of the Bank 5As of December 31, 1976. 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Law Department 319 that consummation of the proposal to form a bank 225.4(g)(1) of the Board’s Regulation Y (12 C.F.R. holding company would not be in the public interest § 225.4(g)(1)). and that the application should be, and is hereby, Bank is to be located in the New York City denied for the reasons summarized herein. banking market.2 Since Bank is a proposed new By order of the Board of Governors, effective bank, no existing or potential competition would be March 27, 1978. eliminated upon consummation of this transaction, nor would Bank’s acquisition cause any immediate Voting for this action: Chairman Miller and Governors increase in the concentration of banking resources Wallich, Coldwell, Jackson, and Partee. Absent and not voting: Governors Burns and Gardner. in any relevant area. Accordingly, the Board con cludes that competitive considerations are consis (Signed) G riffith L. Garwood, tent with approval of these applications. [seal] Deputy Secretary of the Board. The financial and managerial resources and fu ture prospects of Mizbank are regarded as satisfac tory and those of MHA are considered consistent with approval of its application in view of MHA’s limited role in the affairs of Mizbank. As a proposed Mizrahi Holdings Association new bank, Bank has no financial or operating United Mizrahi Bank Ltd., history; however, its prospects as a subsidiary of Tel Aviv, Israel Mizbank appear favorable. Considerations relating to banking factors, therefore, are consistent with Order Approving approval of the application. Formation of Bank Holding Companies Bank will serve as an additional source of bank Mizrahi Holdings Association, Tel Aviv, Israel ing services and expertise for firms and individuals (“MHA”), and United Mizrahi Bank Ltd., Tel engaged in international trade and will also provide Aviv, Israel (“Mizbank”), have applied for the correspondent banking services for domestic and Board’s approval under § 3(a)(1) of the Bank Hold foreign banks in connection with trade between the ing Company Act (12 U.S.C. § 1842(a)(1)) to be United States and Israel. Accordingly, con come bank holding companies through direct and siderations relating to the convenience and needs of indirect acquisition of 70 per cent or more of the the community to be served lend some weight voting shares of UMB Bank and Trust Company, toward approval of the applications. New York, New York (“Bank”), a proposed new In connection with these applications, the Board bank. Mizbank is to acquire these shares of Bank notes that from 1927 until 1977, the Founder’s directly and at the same time MHA, which holds Shares of Mizbank, which entitle their holder to a 100 per cent of a class of Mizbank’s voting securi 50 per cent vote on most matters at shareholder ties, would acquire the Bank shares indirectly meetings of Mizbank, were held by Histadrut Miz through Mizbank. rahi veHapoel Mizrahi—Merkaz Olami (“Mer- Notice of the applications, affording opportunity kaz”), a foreign charitable and religious associa for interested persons to submit comments and tion. In December 1977, Merkaz transferred those views, has been given in accordance with § 3(b) of shares to MHA, an association created by Merkaz the Act. The time for filing comments and views has and having three members (the designation of those expired, and the Board has considered the applica who are responsible for the management of the tions and all comments received in light of the association) in common with Merkaz, for the sole factors set forth in § 3(c) of the Act (12 U.S.C. purpose of avoiding becoming a bank holding com § 1842(c)). pany upon consummation of Mizbank’s proposed Mizbank is the fifth largest commercial bank in acquisition of Bank. Merkaz and MHA have filed Israel, holding deposits of approximately $548 mil with the Board commitments regarding their rela lion. 1 Mizbank has 56 branch offices in Israel and a tionship with each other and with Bank in support representative office in New York City. MHA is an of their contention that as a result of Merkaz’s association of organizations that was formed for the divestiture of its shares of Mizbank, Merkaz does sole purpose of holding shares of Mizbank. Upon consummation of the proposed transaction, both Mizbank and MHA would become foreign bank 2The New York City banking market is comprised of the five boroughs of that city plus Nassau, Westchester, Putnam, and holding companies within the meaning of section Rockland Counties and western Suffolk County in New York State, the northern two-thirds of Bergen County and eastern Hudson County in New Jersey, and southwestern Fairfield banking data are as of June 30, 1977. County in Connecticut. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
320 Federal Reserve Bulletin □ April 1978 not control any of the parties to this application and Voting for this action: Chairman Miller and Governors Wallich, Coldwell, Jackson, and Partee. Absent and not will not do so in the future, and that consequently voting: Governors Gardner and Burns. Merkaz should not be considered a bank holding company upon consummation of this proposal. Nevertheless, although these commitments are use (Signed) G riffith L. Garwood, ful, the facts of these applications raise a question [seal] Deputy Secretary of the Board as to the effectiveness of the divestiture of the Mizbank Founder’s shares. If Merkaz has in fact failed to effect a full divestiture of its controlling shares of Mizbank, it would be deemed, through its control of Mizbank, to be a bank holding company if Mizbank became one, and would be subject to the Texas Commerce Bancshares, Inc., Act’s requirements applicable to foreign bank hold Houston, Texas ing companies. Three of MHA’s fourteen members, comprising Order Approving Acquisition of Bank the governing body of MHA, also hold official posi Texas Commerce Bancshares, Inc., Houston, tions in Merkaz. Particularly in view of the fact Texas, a bank holding company within the meaning that Merkaz held a controlling voice in the affairs of the Bank Holding Company Act, has applied for of Mizbank for fifty years, and that it divested its the Board’s approval under § 3(a)(3) of the Act (12 shares of Mizbank without consideration to an U.S.C. § 1842(a)(3)) to acquire 100 per cent of the organization created by it for the sole purpose of voting shares (less directors’ qualifying shares) of receiving those shares and in immediate anticipation the successor by merger to First National Bank of of Mizbank’s becoming a bank holding company, McAllen, McAllen, Texas (“Bank”). The bank into the Board is unable to conclude that Merkaz’s which Bank is to be merged has no significance divestiture of Mizbank was effective so long as except as a means to facilitate the acquisition of the management interlocks persist. Since Merkaz has voting shares of Bank. Accordingly, the proposed not filed an application to become a bank holding acquisition of shares of the successor organization company, the Board must require the elimination is treated herein as the proposed acquisition of the of the interlocks as a condition to consummation of shares of Bank. the proposed transaction. Accordingly, the Board’s Notice of the application, affording opportunity approval of these applications is granted on the for interested persons to submit comments and condition that members, directors, and officers of views, has been given in accordance with § 3(b) of MHA, Mizbank, and Bank not serve as directors or the Act. The time for filing comments and views has officers of Merkaz, and that those now holding expired, and the Board has considered the applica such interlocking positions resign before consum tion and all comments received in light of the mation of the transaction. factors set forth in § 3(c) of the Act (12 U.S.C. On the basis of the record and subject to the § 1842(c)). foregoing condition, it is the Board’s judgment that Applicant, the second largest banking organiza the proposed acquisition would be in the public tion in Texas, controls 35 banks with aggregate interest and that the applications should be ap deposits of approximately $4.2 billion, representing proved. Accordingly, the applications are approved 7.8 per cent of the total commercial bank deposits for the reasons summarized above. The transac in the market. While Applicant possesses the re tions shall not be made (a) before the thirtieth sources to enter the McAllen market de novo, the calendar day following the effective date of this market’s attractiveness to such form of entry would Order nor (b) later than three months after that be unaffected by the subject proposal. In addition, date, and (c) Bank shall be opened for business not consummation would result in the severance of the later than six months after the effective date of this affiliated relationship between Bank and another Order. Each of the periods described in (b) and (c) bank in the market, resulting in an increase in may be extended for good cause by the Board, or competition in the McAllen market. On the basis of by the Federal Reserve Bank of New York pur the above and other facts of record, the Board suant to delegated authority. concludes that the effects of this proposal on poten tial competition are not such as to warrant denial and that such effects are outweighed by con By order of the Board of Governors, effective siderations relating to the convenience and needs of March 22, 1978. the community to be served. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 321 The financial and managerial resources and fu by what I regard as the adverse effects upon ture propsects of Applicant, its subsidiary banks, potential competition that would result from the and Bank are generally satisfactory, especially in consummation of this proposal. light of Applicant’s commitment to inject additional Texas Commerce is the second largest banking capital into Bank. Thus, banking factors are consis organization in Texas and one of the most likely tent with approval of the application. Upon ap potential entrants into the McAllen banking market proval of the subject application Applicant will in view of Texas Commerce’s financial resources introduce some new services to customers of Bank, and expansion history. The McAllen market is including providing for a lower minimum deposit on considered attractive to entry and presently no certificates of deposit, making additional funds large bank holding companies are represented in the available for loans within Bank’s service area, and market. However, Texas Commerce proposes to assisting Bank in improving its operations and its enter the McAllen market not by a de novo or physical facilities. These convenience and needs foothold entry but by acquiring the second largest factors are sufficient to outweigh any adverse com bank in that market with consequent adverse com petitive effects that might result from consumma petitive effects. I am concerned that this will initiate tion of the subject proposal. Based upon the forego a pattern in this market similar to that in other ing and other considerations reflected in the record, secondary markets where the largest banks have it is the Board’s judgment that the proposed acqui all been acquired by the largest bank holding sition is in the public interest and that the applica companies. tion should be approved. The convenience and needs considerations as On the basis of the record, the application is sociated with the proposal are, in my opinion, approved for the reasons summarized above. The insufficient to outweigh the adverse competitive transaction shall not be made (a) before the thirtieth effects. Moreover, such benefits also could be calendar day following the effective date of this created through de novo entry, a fact that further Order or (b) later than three months after the effec reduces their significance in this case. Therefore, I tive date of this Order, unless such period is ex continue to be quite concerned that a decision such tended for good cause by the Board, or by the as this may encourage bank holding companies to Federal Reserve Bank of Dallas pursuant to dele eschew de novo or foothold entry into markets gated authority. based on the belief that the Board will approve less By order of the Board of Governors, effective procompetitive means of entry. March 1, 1978. For the foregoing reasons I would deny this application. Voting for this action: Governors Jackson and Partee. Voting against this action: Governor Wallich. Present and March 1, 1978 abstaining: Governor Coldwell. Absent and not voting: Chairman Burns and Governors Gardner and Lilly. (Signed) G riffith L. Garwood, [seal] Deputy Secretary of the Board. Order Under Section 4 Citicorp, New York, New York Dissenting Statement of Governor Wallich Order Denying Retention I would deny the application of Texas Commerce of Advance Mortgage Corporation to acquire First National Bank of McAllen on the basis of those reasons stated in my Dissenting Citicorp, New York, New York, a bank holding Statements in the past Texas Commerce company within the meaning of the Bank Holding Bancshares, Inc. First City Bancorporation of Company Act of 1956, has applied for the Board’s Texas, Inc., DETROITBANK, and Northwest approval, under section 4(c)(8) of the Act (12 Bancorporation decisions.1 My denial is prompted acquire City National Bank of Austin, Austin, Texas (63 Federal Reservie Bulletin 674 (1977)); DETROITBANK Corporation, ^ee the Dissenting Statements accompanying the Board Orders Detroit, Michigan to acquire Lake Shore Financial Corporation, approving the applications of Texas Commerce Bancshares, Inc., Muskegon, Michigan (63 Federal Reserve Bulletin 926 (1977)); Houston, Texas, to merge with The BanCapital Financial Corpo and, Northwest Bancorporation, Minneapolis, Minnesota, to ac ration, Austin, Texas (63 Federal Reserve Bulletin 500 (1977)); quire First National Bank, Fort Dodge, Iowa, in Fort Dodge, Iowa First City Bancorporation of Texas, Inc., Houston, Texas, to (63 Federal Reserve Bulletin 10% (1977)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
322 Federal Reserve Bulletin □ April 1978 U.S.C. § 1843(c)(8)) and section 225.4(b)(2) of the Its two largest nonbank subsidiaries are Advance Board’s Regulation Y (12 C.F.R. § 225.4(b)(2)), to and Nationwide Financial Services Corporation. retain all of the voting shares of Advance Mortgage At the time of its acquisition by Applicant in Corporation (“Advance”), Southfield, Michigan. 1970, Advance was the fourth largest mortgage Advance directly engages in the origination and banking firm in the United States measured by a placement of one-to-four family residential mortgage servicing portfolio of $1.5 billion. As of mortgage loans, servicing of mortgage loans for June 30, 1977, Advance ranked as the second institutional investors, origination and servicing of largest mortgage banker in the country, with a mobile home instalment contract loans and exten servicing portfolio of $3.0 billion. In 1970, Advance sions of credit to mobile home dealers to finance was engaged primarily in orginating and servicing their inventories, and extensions of credit secured one-to-four family mortgage loans. To a lesser by second mortgages on one-to-four family residen extent it was engaged in originating and servicing tial properties and servicing of these loans. Such loans on income-producing property and making activities have been determined by the Board to be short-term construction loans. Advance’s direct closely related to banking (12 C.F.R. § 225.4(a)(1) activities now include originating and servicing and (3)).1 one-to-four family mortgage loans, making mobile Notice of the application, affording opportunity home and second mortgage loans, and providing for interested persons to submit comments and financing for mobile home dealers. In 1976 Advance views on the public interest factors, has been duly discontinued making construction loans and loans published (43 Fed. Reg. 1407). The time for filing on income-producing property, and Applicant con comments and views has expired, and the Board solidated these activities within an operations sub has considered all comments received in light of the sidiary of Citibank. Advance currently operates 44 public interest factors set forth in section 4(c)(8) of offices in 22 states, a net increase of 25 offices since the Act. it was acquired by Applicant. Applicant, with total assets of $77.1 billion and This is the second time the Board has considered total deposits of $55.7 billion, is the second largest Applicant’s proposal to retain shares of Advance.4 banking organization in the Nation.2 In terms of On December 26, 1973, the Board denied an earlier domestic office deposits, it is the second largest of application to retain those shares, without prej 223 banking organizations in New York State, with udice, however, to the filing of the present applica 13.8 per cent of the State’s total deposits as of June tion.5 In its earlier decision the Board found that 30, 1976.3 In addition to its two bank subsidiaries, Applicant’s acquisition of Advance had eliminated Citibank, N.A. (“Citibank”), New York, New some direct competition between Applicant and York, and Citibank (New York State), N.A., Buf Advance in the origination of construction loans falo, New York, Applicant controls a number of and loans on income-producing property; that it domestic nonbank subsidiaries engaging in such was likely Applicant would have entered some or activities as consumer, sales, and commercial fi all of the local markets served by Advance either de nance, factoring, mortgage banking, sale and un novo or by the acquisition of a smaller firm, and derwriting of credit-related insurance, and leasing. that the loss of this probable future competition in both local and national markets weighed against approval of the application; and that the combina tion of one of the country’s largest banking organi Advance also operates through twelve direct subsidiaries and zations with one of the largest mortgage bankers has an interest, acquired with the Board’s consent under section 4(c)(13) of the Act, in First National Nippon Shinpan Co., Ltd., presented the dangers Congress feared might arise Tokyo, Japan, a company that engages in a variety of financing from an undue concentration of resources. activities in Japan. One of Advance’s subsidiaries, Lakeland In order to approve an application under section Assurance, Inc., Phoenix, Arizona, engages in reinsurance ac tivities that the Board has not found to be closely related to 4(c)(8) of the Act, the Board must determine banking, and this application does not seek authority to retain that whether the activities of the company to be ac subsidiary. On November 9, 1977, the Federal Reserve Bank of New York, pursuant to delegated authority, authorized Applicant quired or retained are “so closely related to bank through subsidiaries of Advance to engage in the sale of credit- ing or managing or controlling banks as to be a related life and accident and health insurance to cover the out standing balance of loans originated by Advance. The remaining subsidiaries of Advance are either inactive or engage in mortgage banking activities or provide services related to Advance’s direct mortgage banking activities. 4The shares Applicant seeks to retain were acquired in July 2Banking data are as of December 31, 1977, unless otherwise 1970. Under section 4(a)(2) of the Act they may not be retained stated. after December 31, 1980, without Board approval. 3In terms of total deposits, including foreign deposits, Applicant Application by First National City Corporation, 60 Federal is the State’s largest banking organization. Reserve Bulletin 50 (1974). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 323 proper incident thereto.” Where, as here, the ac the dispersal of mortgage funds controlled by in tivities of a nonbank company have been deter stitutional investors. This fact and the fact that mined by regulation to be closely related to bank Advance is by any measure much smaller than ing, the Board is required to consider whether a Applicant mitigate to some extent concerns about bank holding company’s acquisition of that com aggregation of financial power, but the fact of pany “can reasonably be expected to produce fundamental importance in connection with this benefits to the public, such as greater convenience, application is that both companies were among the increased competition, or gains in efficiency, that very largest and most capable in their respective outweigh possible adverse effects, such as undue fields. For that reason the Board has viewed the concentration of resources, decreased or unfair elimination of one as a potential entrant to be a competition, conflicts of interest, or unsound bank serious adverse effect of the acquisition. To out ing practices.” This statutory test requires a posi weigh this adverse effect it is insufficient to show tive showing by an applicant that the public benefits that Applicant has taken one of the country’s of its proposal outweigh the possible adverse ef strongest mortgage bankers and made it stronger, fects. In its first consideration of Applicant’s pro more innovative, and more socially responsible. It posal, the Board found that the reasonably ex is necessary to show that the public benefits would pected public benefits did not outweigh the possible not be as likely to be achieved from a less anticom adverse effects summarized earlier. However, the petitive available means of entry, or that they Board, recognizing that clearer evidence regarding would be delayed or diluted to a degree that would public interest factors might emerge from a longer offset the seriousness of the more anticompetitive period of affiliation between Applicant and Ad consequences of this acquisition. vance, indicated its willingness to entertain further In this regard, Applicant has made two chief evidence on the issue to the extent that such arguments: that large mortgage companies do not evidence might be helpful in illuminating or filing have a significant advantage over small ones, and in details that were then otherwise difficult to that a foothold or de novo affiliate would probably evaluate. never expand to a significant size. The first argu The Board finds in the present record no new ment understates the importance of Advance’s ser evidence sufficient to overcome its previous findings vicing portfolio, which is substantially larger than that the acquisition of Advance had an adverse that of most of its competitors. The continued effect on existing and future competition and con income stream of its mortgage servicing portfolio centration of resources. It is true that the mortgage combined with its access to Applicant’s resources banking industry is one characterized by low con at rates below market place Advance in an almost centration. There are approximately 800 mortgage uniquely superior competitive position within the banking firms in the United States; the barriers to industry to withstand periods of economic adver entry in the field are relatively low; and it is rare sity at the expense of smaller organizations. The that the leading firm in any market will have as Board is likewise unable to agree with Applicant’s much as ten per cent of the market’s share of second argument. Barriers to entry are sufficiently originations. Nevertheless, Advance was at the low in the industry and Applicant has sufficient time it was acquired the fourth largest mortgage resources and sufficient success with mobile home banker and is now the second largest, and Appli financing and other activities begun de novo by it, cant’s resources, in the Board’s judgment, gave it that the Board does not consider it unlikely that an the capability to enter the markets served by Ad affiliate smaller than Advance might reach a signifi vance de novo or through the acquisition of smaller cant size within several years. Applicant has the firms. Such means of entry would have been more resources and management and has shown an incli conducive to competition in many markets. For nation toward retail business that indicates it could that reason the Board continues to view the effect enter the mortgage banking field successfully of the acquisition of Advance on existing and through a smaller acquisition. potential competition and concentration of re With respect to reasonably expected public bene sources as adverse, and continues to believe those fits arising from the acquisition, the original record factors weigh against approval of this application has been supplemented to a significant degree. for the reasons stated in its earlier Order. Applicant has argued that it has caused Advance to It is recognized that Advance differs fundamen assume a contracyclical role in mortgage origina tally from firms in other industries that engage in tions, increasing originations during periods when lending activities in that it is primarily a conduit for conditions forced other originators to curtail their Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
324 Federal Reserve Bulletin □ April 1978 activities, and that this constitutes a public benefit Advance’s behavior during 1974 and 1975 illus that would have been unavailable if Advance had trates the fact that large firms have the economic continued as an independent firm and Applicant strength to suffer losses and to sustain affiliates had entered the market de novo or through a which can consequently achieve growth at the smaller acquisition. The record before the Board in expense of smaller firms, however efficient, less 1973 did not establish that Applicant had caused capable of sustaining short-term losses. The Board Advance to originate a greater volume of mortgage believes that the direction by Congress that the loans than it could have done as an independent Board consider possible undue concentration of firm. It does in fact appear from the present record resources and possible unfair competition in con that Advance assumed such a role in 1974 and 1975, nection with applications under section 4, requires in contrast to the industry generally and in contrast the Board to be concerned with the survival of to Advance’s own performance before its affiliation independent organizations and the encouragement with Applicant. Advance’s originations of one-to- of independent entrants. In this context, there is no four family residential mortgage loans, after a se evidence that the actual effect of Advance’s prac vere decline between 1970 and 1973, increased 121 tices has permanently harmed competition in resi per cent in 1974 and 31 per cent in 1975, while the dential mortgage lending. The number of com mortgage banking industry increased such lending petitors has increased since 1970 in almost every in those years by only 4 per cent and 14 per cent, SMSA Advance serves, and in only three SMSA’s respectively. During similar periods immediately has Advance achieved more than a two per cent prior to its affiliation with Applicant, Advance’s share of one-to-four family residential mortgage performance was approximately in line with the loan originations.6 While this fact moderates industry average. Advance’s share of the national somewhat the Board’s concern, it is unable to mobile home loan market, a field it entered in 1973, conclude that the claimed public benefits of Ad has similarly contrasted with the industry’s average vance’s contracyclical impact can be said clearly to performance. outweigh the anticompetitive and other adverse While Advance’s increased lending activities, effects of the acquisition. In the Board’s judgment, while others were reducing their lending activities, a smaller firm without a servicing portfolio the size may be viewed as having beneficial effects in main of Advance’s7 but with access to Applicant’s re taining the availability of home mortgage funds, sources could have remained in the market when Advance’s continued emphasis on construction and conditions forced other competitors to reduce their related lending until 1976 and the fact that the activity. proportion of Advance’s business devoted to one- Because it is the Board’s judgment that Applicant to-four family residential mortgage loans decreased could itself enter new markets de novo, it does not from pre-affiliation levels do not entirely support view the opening of new offices by Advance as a Applicant’s position regarding its special role in public benefit of significance. The Board notes, residential housing. The fact that Advance’s con however, that during the affiliation, Applicant has struction lending is now performed by Citibank and strengthened Advance’s financial and managerial its mobile home lending was commenced de novo resources, and has broadened Advance’s financial strongly suggests that any impact in those lending services and experimented with new products. areas could have been achieved by Applicant with While product innovation and expanded services out the acquisition of Advance. Moreover, the generally have the effect of stimulating competition Board does not believe the public benefits of Ad and are in themselves public benefits, the Board vance’s contracyclical practices can be said to believes Applicant could have provided new and outweigh the possible adverse effects of the affilia expanded services through less anticompetitive tion. On one side, it might have taken Applicant, as means. In particular, the new mobile home financ a de novo entrant, several years to reach a market ing activities of Advance closely resemble types of position where it could have an important con consumer lending with which Applicant is experi tracyclical impact, and it may not have been feasi enced, and Applicant was already engaged in ble for Advance to have adopted such a policy without access to Applicant’s funds at rates below market. On the other side, Advance’s access to •Advance has been able to expand its mobile home financing Applicant’s funds at rates not obtainable generally very rapidly and capture large market shares in several mobile by its competitors represents one of the specific home loan markets over the same period, however. 7Advance is the second largest mortgage banker in the country adverse effects the Board believes can result from a and its servicing portfolio is approximately $1 billion greater than concentration of resources. that of the seventh largest servicer. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 325 mobile home financing through its consumer fi § 225.2) in the matter of the petition of First Arkan nance subsidiary, Nationwide Financial Services sas Bankstock Corporation, Little Rock, Arkansas Corporation, when Advance began that activity. (“FABCO”), for a control determination by the Advance has also, since the Board’s earlier deci Board. Specifically, FABCO petitioned the Board sion, taken an active role in neighborhood preserva for a determination that FABCO, continuously tion projects, and has committed between $25 mil since prior to December 31, 1970, has exercised a lion and $100 million over the next ten years to such controlling influence over the management and projects. While the Board attaches significance to policies of United Banks of Arkansas, Inc., Little these public benefits, they are not in the Board’s Rock, Arkansas (“United”), a registered one-bank judgment sufficient to outweigh the acquisition’s holding company, and that through United FABCO adverse effects, summarized earlier in this Order has, continuously since prior to December 31, 1970, and in the Board’s 1973 Order. Moreover, the exercised a controlling influence over the manage benefits claimed by Applicant in 1973 and in this ment and policies of First National Bank in Mena, application have not been without their cost to Mena, Arkansas (“Mena Bank”). Applicant. The Board notes that Applicant’s sup The formal hearing was held in Mena and Little port of Advance has diverted Applicant’s already Rock, Arkansas, from October 26, 1976, through substantially leveraged financial resources and has October 30, 1976, before Philip J. LaMacchia, resulted in losses to Applicant. The Board regards former Administrative Law Judge, now retired, in this as an adverse factor which further offsets the accordance with the Board’s Rules of Practice for claimed public benefits. Formal hearings (12 C.F.R. Part 263). A substantial Based on the foregoing and other considerations record on the question to be determined was de reflected in the record, the Board has determined veloped through extensive testimony by witness, that the balance of public interest factors the Board through cross-examination of witnesses by is required to consider under section 4(c)(8) is not FABCO, Board counsel, and Protestants (The favorable. Accordingly, the application is denied. Commercial National Bank of Little Rock, Little By order of the Board of Governors, effective Rock, Arkansas, and certain other Arkansas March 13, 1978. banks), and through numerous exhibits submitted by all parties to the proceeding. Voting for this action: Chairman Miller and Governors In a Recommended Decision dated July 22, 1977, Wallich, Coldwell, Jackson, and Partee. Absent and not the Administrative Law Judge concluded on the voting: Governors Gardner and Burns. basis of the evidence of record that FABCO had acquired control of Mena Bank on January 8, 1971, (Signed) G riffith L. Garwood, in apparent violation of §§ 3(a)(2) and (3) of the Act, [seal] Deputy Secretary of the Board. as amended in 1970. In addition, the Administrative Law Judge concluded that FABCO at no time prior to December 31, 1970, directly or indirectly through United, exercised a controlling influence over the management and policies of Mena Bank. On September 15, 1977, FABCO filed an applica Determinations Under Section 2(a)(2) tion pursuant to § 3(a)(3) of the Act to retain of Bank Holding Company Act indirect control of 91.2 per cent or more of the outstanding voting shares of Bank.2 On October 4, First Arkansas Bankstock Corporation, 1977, FABCO filed notice with the Board’s Secre Little Rock, Arkansas tary that it would make no further contest of the Recommended Decision of the Administrative Law Determination Regarding Control of a Bank Judge and that it would consent to the entry of an Order consistent with that decision.3 By Order of July 1, 19761, the Board of Gover All parties to the proceeding have indicated that nors of the Federal Reserve System ordered that a they do not wish to further contest the findings and formal hearing be held in accordance with § 2(a) of the Bank Holding Company Act of 1956, as amended (12 U.S.C. § 1841(a)) (the “Act”) and 2FABCO was advised by the Board’s staff that processing of the application before the control proceeding was concluded was § 225.2 of the Board’s Regulation Y (12 C.F.R. inappropriate and premature. 3On October 13, 1977, Protestants filed notice with the Board’s Secretary that they would make no further contest of the Recom federal Reserve Bulletin 642. mended Decision of the Administrative Law Judge. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
326 Federal Reserve Bulletin □ April 1978 conclusions of the Administrative Law Judge. The Board, after opportunity for hearing, determines Board has reviewed those findings and conclusions that the transferor is not in fact capable of control and finds that they are supported by the record in ling the transferee. this matter. Accordingly, for the purpose of con Notice of an opportunity for hearing with respect cluding this control determination, the Board be to First City’s request for a determination under lieves it appropriate to adopt the findings and section 2(g)(3) was published in the Federal Regis conclusions contained in the Recommended Deci ter on May 17, 1977 (42 Federal Register 25373). sion of the Administrative Law Judge. The time provided for requesting a hearing has In light of the limited scope of the inquiry at the expired. No such request has been received by the administrative proceeding and the findings and Board. First City has submitted to the Board evi conclusions of the Administrative Law Judge, the dence to show that it is not in fact capable of Board believes that it would be appropriate to controlling Mr. Leonard or Bank. process FABCO’s application to retain its interest It is hereby determined that First City is not in in Bank and, in the context of that application, to fact capable of controlling either Mr. Leonard or review the circumstances surrounding FABCO’s Bank. This determination is based upon the evi acquisition of control of Bank as they relate to the dence of record in this matter that reflects the financial and managerial resources factors in § 3(c) following: of the Act. The sale of Bank’s shares appears to have been By order of the Board of Governors, effective the result of arm’s length negotiations, and Mr. March 13, 1978. Leonard’s purchase appears to have been as an investment for his own account and not as a Voting for this action: Chairman Miller and Governors nominee or representative of any other party. At Burns, Wallich, Coldwell and Jackson. Absent and not the time of the transaction and currently, Mr. voting: Governors Gardner and Partee. Leonard is indebted to Texas B&T, a subsidiary of First City. Such indebtedness, howeer, is unrelated (Signed) G riffith L. Garwood, to the subject stock transaction and does not appear [seal] Deputy Secretary of the Board. to be a means whereby First City or Texas B&T can control Mr. Leonard or Bank.* Furthermore, such indebtedness appears to have arisen in the ordinary First City Bancorporation of Texas, Inc., course of business, is fully secured, and is substan Houston, Texas tially less than Mr. Leonard’s net worth. Mr. Leonard has submitted an affidavit disclaiming Order Granting Determination First City’s capability to control him. In addition, Under The Bank Holding Company Act the board of directors of First City has submitted a First City Bancorporation of Texas, Inc., Hous resolution disclaiming First City’s capability or ton, Texas (“First City”), a bank holding company intent to control or exercise a controlling influence within the meaning of section 2(a) of the Bank over Mr. Leonard or Bank, and the board of Holding Company Act of 1956, as amended (12 directors of Bank has submitted a resolution dis U.S.C. § 1841) (the “Act”), has requested a deter claiming First City’s control or controlling influ mination, pursuant to the provisions of section ence over the management and affairs of Bank. 2(g)(3) of the Act (12 U.S.C. § 1841(g)(3)), that with Accordingly, it is ordered that the request of First respect to the sale by First City of its stock interest City for a determination pursuant to section 2(g)(3) in First Bank and Trust Company, Cedar Hill, be and hereby is granted. This determination is Texas (“Bank”), to Mr. Patrick J. Leonard, First based upon the representations made to the Board City is not in fact capable of controlling Mr. Patrick by First City, Bank, and Mr. Leonard. In the event J. Leonard or Bank notwithstanding the fact that the Board should hereafter determine that facts Mr. Leonard is otherwise indebted to a banking material to this determination are otherwise than as subsidiary of First City, namely, Texas Bank and represented, or that First City, Bank, or Mr. Trust of Dallas, Dallas, Texas (“Texas B&T”). Leonard has failed to disclose to the Board other Under the provisions of section 2(g)(3) of the Act, material facts, this determination may be revoked, shares transferred after January 1, 1966, by any and any change in the facts and circumstances bank holding company to a transferee that is in relied upon by the Board in making this determina debted to the transferor are deemed to be indirectly tion could result in the Board reconsidering the owned or controlled by the transferor unless the determination made herein. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 327 By order of the Board of Governors, acting other individual purchasers or Bank. This determi through its Acting General Counsel, pursuant to nation is based upon the evidence of record in this delegated authority (12 C.F.R. § 265.2(b)(1)), effec matter that reflects the following: tive March 30, 1978. The sale of Bank’s shares and Capital Notes appears to have been the result of arms-length (Signed) Cathy E. Minehan, negotiations, and none of the purchasers of Bank’s Assistant Secretary of the Board. shares, other than Mr. Terry in his capacity as Trustee, appears to have been a nominee or repre sentative of any other party. The purchase of Bank’s shares and Capital Notes was not financed by First City or any of its subsidiaries. The only current indebtedness to Texas B&T, a subsidiary of First City Bancorporation of Texas, Inc., First City, of four of the purchasers is not signifi Houston, Texas cant, is unrelated to the subject stock and note transaction, and appears to have arisen in the Order Granting Determination ordinary course of business. Furthermore, in each Under the Bank Holding Company Act of the four instances the amount of such current First City Bancorporation of Texas, Inc., Hous indebtedness is substantially less than each of the ton, Texas (“First City”), a bank holding company purchaser’s net worth. Mr. Terry has submitted an within the meaning of section 2(a) of the Bank affidavit disclaiming First City’s capability to con Holding Company Act of 1956, as amended (12 trol either him or the other individual purchasers. In U.S.C. § 1841(a) (the “Act”)), has requested a addition, the board of directors of First City has determination, pursuant to the provisions of section submitted a resolution disclaiming First City’s 2(g)(3) of the Act (12 U.S.C. § 1841(g)(3)), that with capability or intent to control or exercise a control respect to the sale by First City of its stock interest ling influence over Mr. Terry or Bank, and the in, and subordinated Capital Notes of, First Bank board of directors of Bank has submitted a resolu and Trust of Richardson, Richardson, Texas tion disclaiming First City’s control or controlling (“Bank”), to Mr. Kenneth Terry as Trustee for influence over the management and affairs of Bank. himself and six other individuals, First City is not in Accordingly, it is ordered that the request of First fact capable of controlling Mr. Kenneth Terry or City for a determination pursuant to section 2(g)(3) any of the six individuals, or Bank, notwithstanding be and hereby is granted. This determination is the fact that Mr. Terry and three of the other six based upon the representations made to the Board individuals are otherwise indebted to a banking by First City, Bank, and Mr. Terry. In the event the subsidiary of First City, Texas Bank and Trust of Board should hereafter determine that facts mate Dallas, Dallas, Texas, (“Texas B&T”). rial to this determination are otherwise than as Under the provisions of section 2(g)(3) of the Act, represented, or that First City, Bank, Mr. Terry, or shares transferred after January 1, 1966, by any any of the parties has failed to disclose to the Board bank holding company to a transferee that is in other material facts, this determination may be debted to the transferor are deemed to be indirectly revoked, and any change in the facts and circum owned or controlled by the transferor unless the stances relied upon by the Board in making this Board, after opportunity for hearing, determines determination could result in the Board reconsider that the transferor is not in fact capable of control ing the determination made herein. ling the transferee. Notice of an opportunity for hearing with respect to First City’s request for a determination under section 2(g)(3) was published in the Federal Regis By order of the Board of Governors, acting ter on August 26, 1977 (42 Fed. Reg. 43121 (1977)). through its Acting General Counsel, pursuant to The time provided for requesting a hearing has delegated authority (12 C.F.R. § 265.2(b)(1)), effec expired. No such request has been received by the tive March 30, 1978. Board. First City has submitted to the Board evi dence to show that it is not in fact capable of controlling Mr. Terry or any of the otherwise in debted individuals or Bank. It is hereby determined that First City is not in (Signed) Cathy E. Minehan, fact capable of controlling Mr. Terry, or any of the Assistant Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
328 Federal Reserve Bulletin □ April 1978 Determinations Under Section 2(g)(3) The sale of Bancorp’s travel agency to Mr. of Bank Holding Company Act Stroube’s corporation was negotiated at arm’s length, and Bancorp made good-faith efforts to First Bancorp, Inc., secure an unrelated purchaser on terms equal to those offered by Mr. Stroube’s corporation. The Order Granting Determination purchase was made as an investment for Mr. Under the Bank Holding Company Act Stroube’s own account and not for or on behalf of another party. There is no evidence to indicate that First Bancorp, Inc. (“Bancorp”), Corsicana, the sale was motivated by an intent to evade the Texas, a bank holding company within the meaning requirements of the Act. The contractual terms of the Bank Holding Company Act of 1956, as among Bancorp, Bank, Travel, and Mr. Stroube amended, has requested a determination pursuant were limited to those reasonably necessary to pro to section 2(g)(3) of the Act (12 U.S.C. § 1841(g)(3)) tect Bancorp’s interest in the deferred portion of that Bancorp is not in fact capable of controlling the purchase price, and there are no other First Travel, Inc. (“Travel”), Corsicana, Texas, or agreements or understandings through which Ban the travel agency transferred by Bancorp to corp or its subsidiaries can control Travel or exert Travel,1 notwithstanding the fact that H. R. any controlling influence over the conduct of the Stroube, Jr., a director of Bancorp and of its travel agency business. In addition, Mr. Stroube’s principal bank subsidiary, First National Bank of other indebtedness to Bank arose in the ordinary Corsicana (“Bank”), Corsicana, Texas, was at the course of business. Mr. Stroube’s personal finan time of the transfer also an officer and director of cial resources are substantial enough to support an Travel; that Mr. Stroube and Travel were contrac inference that Bancorp is not in fact capable of tually obligated to Bancorp for the deferred portion controlling him or Travel by reason of that indebt of the purchase price for the travel agency; and that edness. Bancorp has submitted a resolution of its Mr. Stroube is otherwise indebted to Bank. board of directors disclaiming any ability or inten Under section 2(g)(3) of the Act, a bank holding tion to control Mr. Stroube or Travel, and has company is deemed to own or control indirectly stated that there are no circumstances under which certain interests transferred by it directly or indi it would reacquire the travel agency or acquire rectly to any transferee that is indebted to the shares of Travel. Mr. Stroube has affirmed that transferor or that has one or more officers, di there are no understandings or agreements, written rectors, trustees, or beneficiaries, in common with or otherwise, by which Bancorp may influence or or subject to control by the transferor, unless the control the operations or policies of Travel, and he Board, after opportunity for hearing, determines has agreed to transfer the shares of Travel owned that the transferor is not in fact capable of control by him to other members of his family who are ling the transferee. unrelated to First Bancorp, to resign as an officer Notice of an opportunity for hearing with respect and director of Travel and not to hold any office in to Bancorp’s request was published November 15, Travel in the future or reacquire any direct or 1976 (41 Fed. Reg. 50345). The time provided for indirect ownership interest in Travel or to partici requesting a hearing has expired, and none has been pate in the management or affairs of Travel or the requested. Bancorp has submitted to the Board travel agency. evidence to support its contention that it is not in fact capable of controlling Mr. Stroube or Travel, Accordingly, it is ordered that the request of directly or indirectly, and no contradictory evi Bancorp for a determination pursuant to section dence has been received. 2(g)(3) be and hereby is granted. This determination It is hereby determined that Bancorp is not in fact is based upon the representations made to the capable of controlling Travel or the transferred Board by Bancorp and Mr. Stroube. In the event travel agency. This determination is based upon the the Board should hereafter determine that facts evidence of record in this matter that reflects the material to this determination are otherwise than as following: represented, or that Bancorp or Mr. Stroube has failed to disclose to the Board other material facts, ^though section 2(g)(3) of the Act refers to transfers of this determination may be revoked, and any change “shares,” the Board considers the transfer of all or substantially all of the assets of a company, or the transfer of such a significant in the facts or circumstances relied upon by the volume of assets that the transfer may in effect constitute the Board in making this determination could result in disposition of a separate activity of the transferor, to involve a the Board’s reconsidering the determination made transfer of “shares” within the meaning of the statute. Board Interpretation of January 25, 1978, 42 Fed. Reg. 6214. herein. 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Law Department 329 By Order of the Board of Governors, acting In December 1974, American acquired 96,008 through its Acting General Counsel, pursuant to shares of Bank representing 96 per cent of the delegated authority (12 C.F.R. § 265.2(b)(1)), effec outstanding voting shares of Bank in satisfaction of tive March 20, 1978. a debt previously contracted. Pursuant to section 3(a)(A)(ii) of the Act (12 U.S.C. § 1842(a)(A)(ii)), (Signed) G riffith L. Garwood, American was not required to obtain prior approval [seal] Deputy Secretary of the Board. of the Board to acquire the shares but would have had to obtain such approval to retain the shares of Bank if such shares had not been disposed of within two years. Accordingly, in March 1975 American sold the shares of Bank to Purchasers for $55.03 per Walter E. Heller International Corporation, share or a total purchase price of $5,300,000. Of this Chicago, Illinois amount $400,000 was paid in cash and $4,900,000 Order Denying Determination was paid in the form of a demand note from Under the Bank Holding Company Act Purchasers to American bearing interest of 7 per cent per annum and secured by all of the Bank American National Bank and Trust Company of shares purchased. Since the Purchasers were in Chicago, Chicago, Illinois (“American”) has re debted to American, pursuant to American, pur quested a determination pursuant to the provisions suant to the presumption contained in section 2(g)(3) of section 2(g)(3) of the Bank Holding Company Act of the Act, American is deemed to control the shares of 1956, as amended (the “Act”) (12 U.S.C. of Bank held by the Purchasers.1 While the indebted § 1841(g)(3)) that American is not in fact capable of ness is in the form of a demand note with no controlling Messrs. Denis J. Daly, Jerome J. Brault repayment schedule, it is understood among the and Sheldon Lavin (“Purchasers”) to whom parties that the note will be repaid over a twelve American sold 96 per cent of the shares of Subur year period and that the annual interest rate will not ban Trust and Savings Bank, Oak Park, Illinois exceed 7 per cent.2 It is also understood that (“Bank”), notwithstanding the indebtedness of American does not intend to call the note so long as Purchasers to American incurred in connection current interest is paid, satisfactory progress on with the sale by American of its shares of Bank. amortization of principal is made, and American American’s parent, Walter E. Heller International believes that Bank is “pursuing sound banking Corporation, Chicago, Illinois (“Heller”), is a bank practices.” holding company within the meaning of section 2(a) While it appears that Bank will provide Pur of the Act (12 U.S.C. § 1841(a)) by virtue of its chasers or their assignees with sufficient income to ownership of over 25 per cent of the outstanding repay the indebtedness to American, especially in voting shares of American, and pursuant to section light of the proposed acquisition of Bank by Acorn, 2(g)(1) of the Act (18 U.S.C. § 1841(g)(1)) shares it is not apparent that Purchasers or their assignees controlled by American are deemed to be indirectly would be able to repay the indebtedness if Ameri controlled by Heller. can were to demand payment. To date, with Ameri Under the provisions of section 2(g)(3) of the Act can’s forbearance, no principal payments have (12 U.S.C. § 1841(g)(3)), shares transferred after been made, and interest has been paid to December January 1, 1966, by any bank holding company to a 31, 1976. In the event that American were to transferee that is indebted to the transferor or has one or more officers, directors, trustees, or ben eficiaries in common with or subject to control by the transferor, are deemed to be indirectly owned *On March 9, 1978, the Board approved the application of or controlled by the transferor unless the Board, Acorn Financial Corp., Oak Park, Illinois (“Acorn”), to become a bank holding company by acquiring Bank. It is contemplated that after opportunity for hearing, determines that the in consideration for the transfer of Bank’s shares by Purchasers to transferor is not in fact capable of controlling the Acorn, Acorn will assume Purchasers’ indebtedness to American transferee. Based on the facts the Board has con subject to the same terms. In addition, Purchasers’ will borrow $600,000 from American on the same terms in order to purchase a sidered in connection with this request, the Board similar amount of debentures from Acorn. Acorn in turn will concludes that American and Heller have not pre reduce its indebtedness to American to $4,300,000. It is not sented sufficient evidence to rebut the presumption contemplated that the $600,000 personal notes of Purchasers will be reduced until Acorn has fully repaid its note to American. imposed by section 2(g)(3) of the Act that they are Thus, Purchasers and their assignees would continue to be in capable of controlling Purchasers and Bank, and debted to American after Bank is acquired by Acorn. 2At the time the loan was made in March 1975, the national accordingly, the Board believes that the request for prime rate ranged between 8V4 per cent and IVa per cent per a determination should be denied. annum. 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330 Federal Reserve Bulletin □ April 1978 demand payment of the note, it is unlikely that Voting for this action: Chairman Miller and Governors Purchasers or their assignees could obtain financing Wallich, Coldwell, Jackson, and Partee. Absent and not at a similar low interest rate from another financial voting: Governors Gardner and Burns. institution. In the Board’s view the present struc ture of the indebtedness of Purchasers to American (Signed) Cathy E. M inehan, provides American with the capability to control [seal] Assistant Secretary of the Board. Purchasers and Bank, or alternatively, in its discre tion to call the note and reacquire control of the shares of Bank pledged as collateral. In addition to the structure of the indebtedness, Prior C ertification P ursuant to th e which the Board views as giving American the Bank H olding Com pany Tax A ct o f 1976 capability to control Bank, when the loan was made in March 1975, two officers of American were Industrial National Corporation, elected to Bank’s board of directors, which is Providence, Rhode Island composed of eleven persons.3 While these indi [Docket No. TCR 76-161] viduals have retired as employees of American, they continue to serve American as consultants, Industrial National Corporation, Providence, and their function on Bank’s board of directors is Rhode Island (“INC”), has requested a prior cer by American’s admission, to act as American’s tification pursuant to section 6158(a) of the Internal representatives to keep it advised of Bank’s ac Revenue Code (the “Code”), as amended by sec tivities so that American may evaluate its collat tion 3(a) of the Bank Holding Company Tax Act of eral.4 In the Board’s view, continuation of these 1976 (the “Tax Act”), that its proposed sale of a 50 management interlocks between Bank and Ameri per cent limited partnership interest in Long Wharf can provides American with further capability to Mall Associates, Newport, Rhode Island (“As control Bank. sociates”), and 100 shares of common stock of In an effort to rebut the presumption that it Long Wharf Mall Corporation (“Corporation”), controls Purchasers, American has submitted to the now held by Westminster Properties, Inc. Board a Resolution of its Board of Directors to the (“Westminster”), a wholly-owned subsidiary of effect that neither American nor its affiliates con INC, is necessary or appropriate to effectuate sec trols or exercises a controlling influence over Bank tion 4 of the Bank Holding Company Act (12 or Purchasers. In addition, Bank and Purchasers U.S.C. § 1843 et. seq.) (“BHC Act”). Westminster have submitted a Resolution of Bank’s board of has agreed to sell the partnership interest and directors and individual affidavits, respectively, to shares to two individuals who are limited partners the effect that Bank is not presently controlled by of Associates. American and that American and its affiliates are In connection with this request, the following not capable of controlling Bank. Notwithstanding information is deemed relevant for purposes of these submissions and in light of the facts of record, issuing the requested certification:1 the Board is unable to determine at this time that 1. Industrial Bancorp., Inc. (“Industrial”) was a American and its affiliates are not capable of con corporation organized under the laws of the State of trolling Purchasers or Bank. Delaware on September 18, 1968 to acquire and Accordingly, it is ordered, that the request of hold all the shares of Industrial National Bank of American for a determination pursuant to section Rhode Island (“Bank”). 2(g)(3) that it is not capable of controlling Bank be 2. On September 18, 1968 Industrial acquired and hereby is denied. ownership and control of 1,616,700 shares, repre By order of the Board of Governors, effective senting more than 99 per cent of the outstanding March 24, 1978. voting shares of Bank. 3. INC is a corporation organized under the laws of the State of Rhode Island on April 29, 1970 as a 3American points out that it is common practice in bank stock wholly-owned subsidiary of Industrial, and on the Joans for the lender to place one or two of its officers on the board of the subject bank. While this may be appropriate in a situation same date Industrial was merged into INC. INC where the lender has never controlled the subject bank, the Board believes that such practice is inappropriate where, as here, the lender once controlled the subject bank and is required by law to divest such control. irThis information derives from INC’s correspondence with the 4The Board has stated that it will require termination of all Board concerning its request for this certification, INC’s Registra management interlocks, including representatives, as a precondi tion Statement filed with the Board pursuant to the BHC Act and tion of finding that a divestiture is complete (12 C.F.R. § 225.138). other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 331 thereby acquired ownership and control of the officer or in a policy-making position (including an shares of Bank then held by Industrial. advisory or honorary position) with INC or any of 4. INC became a bank holding company on its subsidiaries as a director, policy-making em December 31, 1970, as a result of the 1970 Amend ployee or consultant, or who performs (directly, or ments to the BHC Act, by virtue of its ownership through an agent, representative or nominee) func and control at that time of more than 25 per cent of tions comparable to those normally associated with the outstanding voting shares of Bank, and it regis such office or position, will hold any such office or tered as such with the Board on September 16, position or perform any such function with As 1971. INC would have been a bank holding com sociates or Corporation. pany on July 7, 1970, if the BHC Act Amendments On the basis of the foregoing information it is of 1970 had been in effect on such date, by virtue of hereby certified that: its ownership and control on that date of more than (A) INC is a qualified bank holding corporation, 25 per cent of the voting shares of Bank. INC within the meaning of section 6158(f)(1) and subsec presently owns and controls 100 per cent (less tion (b) of section 1103 of the Code, and satisfies the directors’ qualifying shares) of the outstanding vot requirements of that subsection; ing shares of Bank. (B) the 50 per cent limited partnership interest in 5. Westminster is a corporation organized on Associates and the 100 shares of Corporation are November 12, 1968 under the laws of the State of “prohibited property” within the meaning of sec Delaware as a wholly-owned subsidiary of Indus tions 6158(f)(2) and 1103(c) of the Code; and trial. Westminster acquired its limited partnership (C) the sale of the 50 per cent limited partnership interest in Associates, as well as 100 shares of interest in Associates and the 100 shares of Corpo Corporation on April 11, 1969. Associates was ration is necessary or appropriate to effectuate formed to construct and operate a retail and office section 4 of the BHC Act. building located in Newport, Rhode Island. Corpo This certification is based upon the representa ration was formed to act as the general partner of tions and commitments made to the Board by INC Associates. INC through Westminster presently and upon the facts set forth above.3 In the event the owns and controls the 50 per cent limited partner Board should hereafter determine that facts mate ship interest in Associates and 100 shares of Corpo rial to this certification are otherwise than as repre ration, all of which it acquired through Westminster sented by INC, or that INC has failed to disclose to before July 7, 1970. The disposition of its interests the Board other material facts or to fulfill any in Associates and Corporation by INC is necessary commitments made to the Board in connection or appropriate to effectuate section 4 of the BHC herewith, it may revoke this certification. Act if INC were to continue to be a bank holding By order of the Board of Governors, acting company beyond December 31, 1980.2 through its Acting General Counsel, pursuant to 6. Westminster has contracted to sell the limited delegated authority (12 C.F.R. § 265.2(b)(3)), effec partnership interest of Associates and the shares of tive March 31, 1978. Corporation to two individuals who are also partners of Associates. (Signed) Griffith L. Garwood, 7. After such sale, no person who is a director, [seal] Deputy Secretary of the Board. 3This prior certification is subject to INC’s commitment that it will obtain the Board’s favorable determination under section 2The Board has determined that real estate development and 2(g)(3) of the Bank Holding Company Act that INC will not be property management are not permissible nonbanking activities capable of controlling Associates, Corporation or the individuals for bank holding companies (12 C.F.R. § 225.126). to whom it transfers its interests in Associates and Corporation. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
332 Federal Reserve Bulletin □ April 1978 ORDERS APPROVED UNDER BANK HOLDING COMPANY ACT By the Board of Governors During March 1978, the Board of Governors approved the applications listed below. Copies are available upon request to Publications Services, Division of Administrative Services, Board of Governors of the Federal Reserve System, Washington, D. C. 20551. Section 3 Board action (effective Applicant Bank(s) date) Ames Holding Company, Ltd., Ames Bank, Omaha, Nebraska 3/30/78 Omaha, Nebraska Coffeyville Financial Corporation, The Condon National Bank of Coffeyville, 3/21/78 Coffeyville, Kansas Coffeyville, Kansas First Agency of Hastings, Inc., Hastings, The First National Bank of Hastings, 3/28/78 Minnesota Hastings, Minnesota Hawarden Bancshares, Inc., Hawarden, Farmers State Bank, Hawarden, Iowa 3/6/78 Iowa Madison National Company, Madison, The Farmers National Bank of Madison, 3/10/78 Nebraska Madison, Nebraska National Bancshares Corporation of Texas, National Bank of Commerce, Kerrville, 3/3/78 San Antonio, Texas Texas Palatine Bancorporation, Inc., Palatine, First Bank and Trust Company, Palatine, 3/28/78 Illinois Illinois Republic of Texas Corporation, Dallas, Ridglea Bank, Fort Worth, Texas 3/17/78 Texas Royal Trustco Limited, Ottawa, Ontario, Bay meadows Bank, Jacksonville, Florida 3/30/78 Canada; and Royal Trust Bank Corp., Miami, Florida Snowmass Bancorp, Inc., West Village, Bank of Snowmass, West Village, Colorado 3/9/78 Colorado Western Banks of Wyoming, Inc., Rapid Moorcroft State Bank, Moorcroft, Wyoming 3/2/78 City, South Dakota By Federal Reserve Banks Recent applications have been approved by the Federal Reserve Banks as listed below. Copies of the orders are available upon request to the Reserve Banks. Section 3 Reserve Effective Applicant Bank(s) Bank date Northwest Ohio Bancshares, Inc., National Bank of Fulton County, Cleveland 2/21/78 Toledo, Ohio Delta, Ohio SBT Corporation, Savannah, Georgia Savannah Bank and Trust, Atlanta 2/7/78 Savannah, Georgia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Law Department 333 Section 3------continued Reserve Effective Applicant Bank(s) Bank date Trust Company of Georgia, Trust The First National Bank of Wayne Atlanta 3/22/78 Company Bank, and Trust County, Jessup, Georgia Company of Georgia Associates, all of Atlanta, Georgia First Affiliated Bancorporation, Inc., The First National Bank of Stevens Chicago 3/17/78 Stevens Point, Wisconsin Point, Stevens Point, Wisconsin Section 4 Nonbanking company Reserve Effective Applicant Bank(s) (or activity) Bank date Chemical New York reinsuring certain life New York 3/10/78 Corporation, New York, and accident and health New York insurance Centran Corporation, Inc., Investors Income Insur- Cleveland 3/7/78 Cleveland, Ohio ance Company, Garland, Texas Security Pacific Corpora writing certain credit life San Fran- 2/24/78 tion, Los Angeles, and credit accident cisco California and health insurance ORDERS APPROVED UNDER BANK MERGER ACT Reserve Effective Applicant Bank(s) Bank date The Bank of Mid-Jersey, Bordentown The Hamilton Bank National Asso Philadelphia 3/29/78 Township, New Jersey ciation, Hamilton Township, New Jersey Hamilton Bank and Trust Company, The Bank of Arlington, Arlington, Richmond 3/16/78 Bailey’s Crossroads, Virginia Virginia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
334 Federal Reserve Bulletin □ April 1978 PENDING CASES INVOLVING THE BOARD OF GOVERNORS* Citicorp v. Board of Governors, filed March 1978, BankAmerica Corporation v. Board of Governors, U.S.C.A. for the Second Circuit. filed May 1977. U.S.C.A. for the Ninth Circuit. Security Bancorp and Security National Bank v. Central Wisconsin Bankshares, Inc. v. Board of Board of Governors, filed March 1978, U.S.C. A. Governors, filed June 1976, U.S.C.A. for the for the Ninth Circuit. Seventh Circuit. Michigan National Corporation v. Board of Gover National Urban League, et. al. v. Office of the nors, filed January 1978, U.S.C.A. for the Sixth Comptroller of the Currency, et. al., filed April Circuit. 1976, U.S.D.C. for the District of Columbia Wisconsin Bankers Association v. Board of Gover Circuit. nors, filed January 1978, U.S.C.A. for the Dis Memphis Trust Company v. Board of Governors, trict of Columbia. filed February 1976, U.S.D.C. for the Western Gelfand v. Board of Governors, filed December District of Tennessee. 1977, U.S.C.A. for the Fifth Circuit. First Lincolnwood Corporation v. Board of Gover Vickars-Henry Corp. v. Board of Governors, filed nors, filed February 1976, U.S.C.A. for the December 1977, U.S.C.A. for the Ninth Circuit. Seventh Circuit. Emch v. The United States of America, et. al., filed Roberts Farms, Inc. v. Comptroller of the Cur November 1977, U.S.D.C. for the Eastern Dis rency, et. al., filed November 1975, U.S.D.C. for trict of Wisconsin. the Southern District of California. Corbin v. Federal Reserve Bank of New York, Florida Association of Insurance Agents, Inc. v. Board of Governors, et. al., filed October 1977, Board of Governors, and National Association of U.S.D.C. for the Southern District of New York. Insurance Agents, Inc. v. Board of Governors, Central Bank v. Board of Governors, filed October filed August 1975, actions consolidated in 1977, U.S.C.A. for the District of Columbia. U.S.C.A. for the Fifth Circuit. Investment Company Institute v. Board of Gover David R. Merrill, et al. v. Federal Open Market nors, filed September 1977, U.S.C.A. for the Committee of the Federal Reserve System, filed District of Columbia. May 1975, U.S.D.C. for the District of Columbia. Plaza Bank of West Port v. Board of Governors, Louis J. Roussel v. Board of Governors, filed April filed September 1977, U.S.C.A. for the Eighth 1975, U.S.D.C. for the Eastern District of Circuit. Louisiana. First State Bank of Abilene, Texas v. Board of Bankers Trust New York Corporation v. Board of Governors, filed August 1977, U.S.C.A. for the Governors, filed May 1973, U.S.C.A. for the District of Columbia. Second Circuit. BankAmerica Corporation v. Board of Governors, *This list of pending cases does not include suits against the filed May 1977, U.S.D.C. for the Northern Dis Federal Reserve Banks in which the Board of Governors is not trict of California. named a party. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
335 Membership of the Board of Governors of the Federal Reserve System, 1913-78 APPOINTIVE MEMBERS1 Federal Reserve’ Date of initial Other dates and information relating Name district oath of office to membership2 Charles S. Hamlin.......... .. Boston................ Aug. 10, 1914 Reappointed in 1916 and 1926. Served until Feb. 3, 1936.3 Paul M. Warburg................ New York........ .do . Term expired Aug. 9, 1918. Frederic A. Delano............ Chicago ............ .do . Resigned July 21, 1918. W. P. G. Harding .............. Atlanta.............. .do . Term expired Aug. 9, 1922. Adolph C. Miller.............. . San Francisco .. .do . Reappointed in 1924. Reappointed in 1934 from the Richmond District. Served until Feb. 3, 1936.3 Albert Strauss .................... New York.......... Oct. 26, 1918 Resigned Mar. 15, 1920. Henry A. Moehlenpah ..,.. Chicago.............. Nov. 10, 1919 Term expired Aug. 9, 1920. Edmund Platt...................... New York.......... June 8, 1920 Reappointed in 1928. Resigned Sept. 14, 1930. David C. Wills.................... Cleveland.......... Sept. 29, 1920 Term expired Mar. 4, 1921. John R. Mitchell .............. . Minneapolis---- May 12, 1921 Resigned May 12, 1923. Milo D. Campbell............,. Chicago.............. Mar. 14, 1923 Died Mar. 22, 1923. Daniel R. Crissinger.......... Cleveland.......... May 1, 1923 Resigned Sept. 15, 1927. George R. James................ St. Louis............ May 14, 1923 Reappointed in 1931. Served until Feb. 3, 1936.3 Edward H. Cunningham ... Chicago ............ .do . Died Nov. 28, 1930. Roy A. Young..................,. Minneapolis---- Oct. 4, 1927 Resigned Aug. 31, 1930. Eugene Meyer.................. . New York.......... Sept. 16, 1930 Resigned May 10, 1933. Wayland W. Magee.......... . Kansas City---- May 18, 1931 Term expired Jan. 24, 1933. Eugene R. Black ................ Atlanta .............. May 19, 1933 Resigned Aug. 15, 1934. M. S. Szymczak ..............,. Chicago.............. June 14, 1933 Reappointed in 1936 and 1948. Re signed May 31, 1961. J. J. Thomas......................,. Kansas City .... .do . Served until Feb. 10, 1936.3 Marriner S. Eccles .......... . San Francisco .. Nov. 15, 1*934 Reappointed in 1936, 1940, and 1944. Resigned July 14, 1951. Joseph A. Broderick........ . New York.......... Feb. 3, 1936 Resigned Sept. 30, 1937. John K. McKee................ . Cleveland.......... .do . Served until Apr. 4, 1946.3 Ronald Ransom................ . Atlanta.............. .do . Reappointed in 1942. Died Dec. 2, 1947. Ralph W. Morrison.......... . Dallas ................ Feb. 10, 1936 Resigned July 9, 1936. Chester C. Davis.............. . Richmond.......... June 25, 1936 Reappointed in 1940. Resigned Apr. 15, 1941. Ernest G. Draper.............. . New York.......... Mar. 30, 1938 Served until Sept. 1, 1950.3 Rudolph M. Evans .......... . Richmond.......... Mar. 14, 1942 Served until Aug. 13, 1954.3 James K. Vardaman, Jr. .. St. Louis............ Apr. 4, 1946 Resigned Nov. 30, 1958. Lawrence Clayton............ . Boston................ Feb. 14, 1947 Died Dec. 4, 1949. Thomas B. McCabe ........ . Philadelphia___ Apr. 15, 1948 Resigned Mar. 31, 1951. Edward L. Norton .......... . Atlanta .............. Sept. 1, 1950 Resigned Jan. 31, 1952. Oliver S. Powell................ . Minneapolis .... .do . Resigned June 30, 1952. Wm. McC. Martin, Jr. . New York.......... Apr. 2, 1951 Reappointed in 1956. Term expired Jan. 31, 1970. A. L. Mills, Jr.................... . San Francisco .. Feb. 18, 1952 Reappointed in 1958. Resigned Feb. 28, 1965. J. L. Robertson................ . Kansas City.... .do . Reappointed in 1964. Resigned Apr. 30, 1973. For notes, see page 336. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
336 Membership of the Board of Governors, 1913-78 Federal Reserve Date of initial Other dates and information relating Name district oath of office to membership2 .. Minneapolis .... Aug. 13, 1954 Died Oct. 21, 1954. .. Philadelphia___ Aug. 12, 1954 Served through Feb. 28, 1966. .. Dallas ................ Mar. 17, 1955 Retired Apr. 30, 1967. .. Atlanta .............. Mar. 25, 1959 Reappointed in 1960. Resigned Sept. 18, 1963. .. Chicago.............. Aug. 31, 1961 Reappointed in 1962. Served until Feb. 13, 1976.3 .. Richmond.......... Nov. 29, 1963 Served until Mar. 8, 1974.3 .. San Francisco .. Apr. 30, 1965 Served through May 31, 1972. .. Philadelphia___ Mar. 9, 1966 Resigned Aug. 31, 1974. .. Dallas ................ May 1, 1967 Reappointed in 1968. Resigned Nov. 15, 1971. Arthur F. .. New York.......... Jan. 31, 1970 Term began Feb. 1, 1970. Resigned Mar. 31, 1978. .. St. Louis............ Jan. 4, 1972 Resigned June 1, 1975. .. San Francisco .. June 5, 1972 Resigned Jan. 2, 1976. .. Kansas City___ June 11, 1973 Resigned May 15, 1976. .. Boston................ Mar. 8, 1974 .. Dallas ................ Oct. 29, 1974 .. Atlanta .............. July 14, 1975 .. Richmond.......... Jan. 5, 1976 .. Philadelphia___ Feb. 13, 1976 David M. .. Minneapolis .... June 1, 1976 Resigned Feb. 24, 1978. G. Williai .. San Francisco .. Mar. 8, 1978 CHAIRMEN4 VICE CHAIRMEN4 Charles S. Hamlin . .Aug. 10, 1914-Aug. 9, 1916 .Aug. 10, 1914--Aug. 9, 1916 W. P. G. Harding .. .Aug. 10, 1916-Aug. 9, 1922 Paul M. Warburg Aug. 10, 1916--Aug. 9, 1918 Daniel R. Crissinger .May 1, 1923-Sept. 15, 1927 .Oct. 26, 1918--Mar. 15, 1920 Roy A. Young..........Oct. 4, 1927-Aug. 31, 1930 July 23, 1920-Sept. 14, 1930 Eugene Meyer..........Sept. 16, 1930-May 10, 1933 .Aug. 21, 1934--Feb. 10, 1936 Eugene R. Black----May 19, 193 3-Aug. 15, 1934 •Aug. 6, 1936--Dec. 2, 1947 Marriner S. Eccles . .Nov. 15, 1934-Jan. 31, 1948 Mar. 11, 1955--Feb. 28, 1966 Thomas B. McCabe .Apr. 15, 1948-Mar. 31, 1951 .Mar. 1, 1966--Apr. 30, 1973 Wm. McC. Martin, Jr.Apr. 2, 1951-Jan. 31, 1970 George W. Mitchell .May 1, 1973--Feb. 13, 1976 Arthur F. Burns ... .Feb. 1, 1970-Jan. 31, 1978 Stephen S. Gardner .Feb. 13, 1976- G. William Miller .. .Mar. 8, 1978- EX-OFFICIO MEMBERS1 SECRETARIES OF THE TREASURY COMPTROLLERS OF THE CURRENCY W. G. McAdoo ... .Dec. 23, 1913-Dec. 15, 1918 John Skelton WilliamsFeb. 2,1914-Mar. 2, 1921 Carter Glass............ .Dec. 16, 1918-Feb. 1, 1920 Daniel R. Crissinger .Mar. 17, 1921-Apr. 30, 1923 David F. Houston .. .Feb. 2, 1920-Mar. 3, 1921 Henry M. Dawes ...May 1, 1923-Dec. 17, 1924 Andrew W. Mellon..Mar. 4, 1921-Feb. 12, 1932 Joseph W. McIntosh Dec. 20, 1924-Nov. 20, 1928 Ogden L. Mills .... Feb. 12, 1932-Mar. 4, 1933 J. W. Pole..................Nov. 21, 1928-Sept. 20, 1932 William H. Woodin .Mar. 4, 1933-Dec. 31, 1933 J. F. T. O’Connor.. .May 11, 1933-Feb. 1, 1936 Henry Morgenthau, Jr. Jan. 1, 1934-Feb. 1, 1936 ‘Under the provisions of the original Federal Reserve Act the of the Currency should continue to serve as members until Feb. Federal Reserve Board was composed of seven members, in 1, 1936; that the appointive members in office on the date of cluding five appointive members, the Secretary of the Treasury, that Act should continue to serve until Feb. 1, 1936, or until who was ex-officio chairman of the Board, and the Comptroller their successors were appointed and had qualified; and that of the Currency. The original term of office was 10 years, and thereafter the terms of members should be 14 years and that the the five original appointive members had terms of 2, 4, 6, 8, designation of Chairman and Vice Chairman of the Board should and 10 years, respectively. In 1922 the number of appointive be for a term of 4 years. members was increased to six, and in 1933 the term of office 2Date after words “Resigned” and “Retired” denotes final was increased to 12 years. The Banking Act of 1935, approved day of service. Aug. 23, 1935, changed the name of the Federal Reserve Board Successor took office on this date. to the Board of Governors of the Federal Reserve System and 4Chairman and Vice Chairman were designated Governor and provided that the Board should be composed of seven appointive Vice Governor before Aug. 23, 1935. members; that the Secretary of the Treasury and the Comptroller Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
337 Announcements REGULATION B: card in a short period of time); the card issuer’s authorization facilities are not functioning; a party Amendment and Interpretation to the use of the card has disavowed responsibility The Board of Governors of the Federal Reserve for the account; or a billing statement has been System announced on March 16, 1978, that it had returned for lack of a forwarding address. amended Regulation B (Equal Credit Opportunity) The amendment corresponds to Proposal A, to specify what constitutes adverse action in a which is one of two alternative proposals published credit transaction at the point of sale. by the Board last October to solicit comment on In a separate action, the Board instructed its staff issues raised by the Justice Department and the to withdraw an official staff interpretation dealing Federal Trade Commission concerning a staff in with the collection—for marketing purposes—of terpretation of the definition of adverse action as information otherwise prohibited under Regulation applied to point-of-sale credit. The amendment to B and to issue a new interpretation restricting the Regulation B replaces the staff interpretation. applicability of the interpretation. The new official staff interpretation dealing with The amendment specifying what constitutes ad the collection of information for marketing pur verse action in a credit transaction at the point of poses is substantially the same in content as the sale deals chiefly with credit-card transactions. It previous interpretation, but its applicability has specifies that a refusal or failure to authorize a been narrowed. transaction at the point of sale is an adverse action The initial interpretation (EC-0007) was issued if— April 13, 1977, in response to an inquiry from a 1. The terms of an account are changed at the seller of religious books operating primarily by point of sale in a way that is unfavorable to the soliciting from door to door and by making sales customer—for instance, refusal to authorize credit under an open-end credit arrangement. The because the credit limit has been lowered by the company’s sales agents orally request, and record creditor. on credit applications, information about the cus 2. A creditor terminates an account at the point tomer’s religious affiliation on the grounds that this of sale. permits effective, nonoffensive marketing of the 3. A creditor denies an application, made in creditor’s product. accordance with the creditor’s procedures at the The staff issued an official interpretation stating point of sale, to increase the credit limit of an that a seller of religious books may inquire about a account. customer’s religion in a credit transaction so long as Regulation B provides that adverse action in a the information is used only for marketing purposes credit transaction must be followed by written and not as a factor in determining whether to grant notification to the consumer of the reason for credit. refusal of credit, or notice to the consumer of the To meet objections to the interpretation the right to receive such an explanation. Board instructed the staff to withdraw it and to Other instances of denial of credit at the point of issue a new interpretation applicable only to facts sale do not constitute adverse action requiring the discussed in the interpretation. The original in creditor to advise the customer in writing why the terpretation had authorized other creditors to make credit was denied. Such instances include cases in otherwise prohibited inquiries in circumstances which a credit-card holder presents an expired card similar to those of the seller of religious books. or does not provide other required information; a Also, the new interpretation notes that a record card that has been reported lost or stolen is pre of such inquiries must be retained by the creditor sented; the amount of the transaction exceeds a for 25 months and that this record will be available cash advance limit; circumstances that suggest for review by the Federal Trade Commission, the fraud are present (such as excessive use of a credit Federal agency with jurisdiction over this creditor. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
338 Federal Reserve Bulletin □ April 1978 MONEY STOCK REVISION 2. Money stock seasonal factors—1978 The money stock and related measures have been Time deposits revised to incorporate the latest benchmark ad justments for nonmember banks and revised sea Month, Currency Demand Member banks or week deposits Nonmembei sonal factors. banks CD’s Other Rates of change for recent annual, half-year, and quarterly periods for M-l, M-2, and M-3 measures Monthly derived from quarterly averages are shown in Table 1978— Jan........... .9920 1.0260 1.0010 .9990 .9950 1. Monthly and weekly M-l and M-2 seasonal Feb.......... .9880 .9810 .9690 1.0010 1.0020 Mar.......... .9920 .9840 .9780 1.0060 1.0080 factors for 1978 are shown in Table 2. Apr.......... .9980 1.0100 .9750 1.0080 1.0080 May .... .9980 .9800 .9720 1.0080 1.0070 Benchmark adjustments for the M-l and M-2 June .... 1.0010 .9955 .9950 1.0060 1.0030 measures of the money stock encompass a longer- July ....... 1.0080 1.0040 .9990 1.0020 1.0000 than-normal period of time because of statistical Aug.......... 1.0040 .9890 1.0200 .9990 1.0010 Sept......... .9980 .9930 1.0250 .9950 .9980 problems. The current revision includes corrected Oct.......... .9980 .9980 1.0300 .9950 .9970 Nov......... 1.0070 1.0060 1.0100 .9890 .9920 data for the universe of nonmember banks for Dec.......... 1.0170 1.0330 1.0260 .9920 .9890 December 1976 as well as such universe figures for Weekly March, June, and September 1977. Revision in Jan. 4 ......... 1.0060 1.0790 1.0270 .9973 .9906 nonmember bank deposit estimates added $400 11 1.0040 1.0480 1.0140 .9980 .9932 18 .9945 1.0330 1.0000 .9983 .9947 million to M-l at the end of 1976 and $1.6 billion by 25 , , . .9830 1.0010 .9910 1.0000 .9961 the end of 1977. The benchmarking lowered M-2 Feb. 1 .9770 .9880 .9840 .99% .9973 about $400 million at the end of 1976 and raised it 8 .9930 .9910 .9770 .9990 .9990 15 .9905 .9860 .9700 1.0012 1.0015 about $1.4 billion at the end of 1977. 22 .9880 .9710 .9640 1.0015 1.0028 Seasonal revisions smoothed the quarterly and Mar. 1 ......... .9790 .9720 .9600 1.0035 1.0045 8 .9975 .9850 .9640 1.0038 1.0066 monthly data considerably, reducing bulges in 15 .9950 .9940 .9710 1.0060 1.0078 22 .9910 .9810 .9820 1.0050 1.0078 growth of M-l that had occurred in April, July, and 29 .9850 .9720 .9930 1.0072 1.0092 October of last year and raising growth in adjacent Apr. 5 ......... .9970 1.0100 .9940 1.0097 1.0102 months. (Bulges in April and October had also 12 1.0080 1.0170 .9820 1.0092 1.0107 19 .9990 1.0250 .9730 1.0065 1.0070 developed in 1976.) Growth in these months is still 26 .9890 1.0000 .9630 1.0066 1.0058 quite strong, however, possibly indicating de May 3 ......... .9910 .9920 .9610 1.0074 1.0046 10 1.0060 .9820 .9630 1.0078 1.0060 velopment of a new seasonal pattern not fully 17 .9990 .9860 .9700 1.0076 1.0067 captured in the seasonal adjustment procedure. If 2 31 4 . . , . . 9 9 9 9 4 4 0 0 . . 9 96 7 9 7 0 0 . . 9 9 7 8 6 3 0 0 1 1. . 0 0 0 0 8 7 3 8 1 1 . . 0 0 0 0 7 6 3 4 so, additional data and subsequent review of sea June 7 ......... 1.0050 .9930 .9890 1.0074 1.0058 sonal factors could further smooth the pattern of 14 1.0050 1.0010 .9900 1.0078 1.0050 21 1.0000 .9990 .9930 1.0042 1.0018 growth in these months. 28 .9920 .9830 1.0050 1.0036 .9998 1. Comparison of old and revised money stock July 12 5 ......... 1 1 . . 0 0 1 16 4 0 0 1 1. . 0 0 0 1 9 2 0 0 1 . . 9 0 9 05 4 0 0 1 1 . .0 0 0 03 5 0 0 1. . 0 9 0 9 0 9 2 8 growth rates 19 1.0090 1.0130 .9950 1.0014 .9998 26 1.0000 .9890 1.0010 1.0012 1.0000 Annual rates of growth based on quarterly-average data; per cent Aug. 2 9 . . . . . . . . . . . . . . . . . . 1 . . 9 0 9 1 9 5 0 0 . .9 9 9 9 6 2 0 0 1 1 . . 0 0 0 1 6 4 0 0 1 1 . . 0 0 0 0 0 0 8 0 1 1 . . 0 0 0 01 0 2 0 16 1.0080 .9950 1.0200 .9993 1.0014 23 1.0010 .9820 1.0220 .9980 1.0008 M-l M-2 M-3 30 .9905 .9820 1.0260 .9976 1.0004 Period Sept. 6 ......... 1.0080 .9930 1.0210 .9975 .9998 13 1.0030 1.0060 1.0170 .9958 .9986 Old Revised Old Revised Old Revised 20 .9965 .9980 1.0180 .9928 .9966 27 .9860 .9720 1.0370 .9940 .9956 Annual: Oct. 4 ......... .9940 1.0030 1.0420 .9947 .9974 1976 ................ 5.6 5.7 10.9 10.9 12.8 12.8 1 1 1 8 2 1 . 0 0 0 0 0 95 0 2. . 0 9 0 9 2 9 0 0 1 1 . . 0 0 3 3 9 1 0 0 . .9 99 9 5 6 8 2 . .9 9 9 97 8 6 9 1977 ................ 7.4 7.8 9.6 9.8 11.6 11.7 25 .9950 .9910 1.0240 .9942 .9960 Half-year: Nov. 1 ......... .9870 .9980 1.0160 .9918 .9932 1977—HI .... 6.4 7.6 9.7 10.1 10.8 11.3 8 . , 1.0110 1.0090 1.0090 .9904 .9930 H2 .... 8.2 7.7 9.0 9.0 11.7 11.4 15 1.0100 1.0120 1.0070 .9890 .9922 22 1.0080 1.0000 1.0090 9888 .9920 29 , . 1.0030 1.0010 1.0130 .9890 .9908 Quarterly 1977—Ql .... 4.2 6.9 9.9 10.9 11.3 12.2 Dec. 6 ......... 1.0140 1.0210 1.0180 .9886 .9905 Q2 .... 8.4 8.1 9.2 9.0 10.3 10.2 13 1.0185 1.0250 1.0220 .9916 .9900 Q3 .... 9.3 8.1 10.3 9.9 12.4 11.9 20 1.0195 1.0320 1.0260 .9912 .9882 Q4 ... 6.8 1:2 7.6 8.0 10.8 10.6 27 1.0250 1.0300 1.0340 .9932 .9877 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Announcements 339 The current revision also incorporates new sea into the possession of bank personnel who make sonal factors for M-3. Revised factors for M-3 go investment decisions for the account of others. The back to 1959, but the changes had little impact on Board urged each State member bank to review its growth rates of M-3. policies and procedures to make sure they would Monthly and weekly data from 1959 to date are accomplish these purposes in the particular circum available from the Banking Section of the Board’s stances of the bank. Division of Research and Statistics. The Board set forth the following examples of possible approaches to the development of written policies and procedures to avoid the misuse of POLICY STATEMENT: Misuse of material inside information: 1. Denial of access by trust personnel to commer Inside Investment Information cial credit files; government, agency, and municipal The Board of Governors has issued a policy state securities underwriting files; and other pertinent ment alerting State member banks to penalties that files. may arise from the misuse of inside investment 2. A prohibition against attendance by trust per information and providing examples of steps that sonnel at private meetings with bank lending or could be taken to avoid violation of Federal law in underwriting personnel, except when the meeting is this field. held solely to seek a new customer relationship. The Board said the policy statement—which be 3. A prohibition against personnel serving simul came effective March 20, 1978—reflects the judg taneously on a committee authorized to make spe ment of the Board that misuse of material inside cific investment decisions or recommendations and information in connection with securities transac a committee responsible for commercial lending or tions or recommendations about such transactions underwriting of government issues. constitutes an unsafe and unsound banking prac 4. A requirement for a prompt report to man tice. agement by any trust department, or trust depart Accordingly, the statement said, the Board “ex ment employee, of the receipt of inside information pects each State member bank exercising invest personnel should not have, and, if management ment discretion for the accounts of others to adopt determines that the information is material, prompt written policies and procedures ... to ensure that orders to— material inside information in its possession is not •• Halt all bank trading of the indicated secu misused.” rity, or bank recommendations concerning it; The policy statement, affecting chiefly the opera •• Determine whether the information is valid tions of trust departments of State member banks, and has not been made public; noted that Federal law generally prohibits the pur •• Request the issuer or other appropriate par chase or sale of securities by persons possessing ties to make pertinent information public; material inside information about the securities •• Seek legal advice, if the information is not until the information they have is disclosed to the publicly disclosed, as to what else should be done public. If the information cannot be disclosed pub before trading in the security, or recommendations licly because it had been obtained in confidence, concerning it, are resumed. holders of the information must abstain from trans 5. The provision, for every account, of a copy of actions or recommendations concerning the secu the bank’s policies and procedures to the person rity involved until the information is divulged. who has power to terminate the bank’s discretionary Violations of these laws, the statement noted, investment authority over the account, or to the could expose banks to severe financial penalties person to whom an accounting would ordinarily be and to criminal charges. rendered. Information was defined as being “material” 6. Physical separation of trust and commercial when there is a substantial likelihood that a reason bank lending and investing personnel, as circum able investor would consider it important in decid stances allow. ing whether to buy, sell, or hold securities. The Board’s policy statement is as follows: The Board said that, in its opinion, the preventive policies and procedures banks should adopt should Statement of Policy limit activities that are likely to result in an im Concerning Use of Inside Information proper interchange of material information. The Commercial banks may receive information bank should also be provided with ways to deal about their customers that is not otherwise avail affirmatively with such information when it comes able to the public. In many cases, customers about Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
340 Federal Reserve Bulletin □ April 1978 which the bank possesses confidential information member bank to review its organizational structure are firms whose securities are publicly traded. and methods of operation to ensure that its policies Full-service commercial banks, being institutions and procedures are appropriately tailored to its that provide a diversity of services, may, at the circumstances. System trust examiners will be in same time such confidential information is in their structed to evaluate regularly the adequacy of possession, be effecting purchases or sales of such policies and procedures adopted by individual securities for trust customers and others and advis banks. ing customers as to the purchase or sale of such securities. Set forth below are examples of specific ap When confidential information in the possession proaches to dealing with inside information that of a person is “material” (that is, of such nature that State member banks may wish to consider in the development of policies and procedures for their there is a substantial likelihood that a reasonable investor would consider it important in deciding own use. Although more generally applicable to larger banks (that is, those managing assets for the whether to buy, sell, or hold securities), Federal accounts of others with a market value over $100 securities law generally prohibits the purchase or million), they may prove useful to smaller banks as sale of pertinent securities by such person until the well. information is disseminated to the public. A person in possession of such material inside information 1. Trust personnel (that is, bank employees must, before effecting transactions in the affected whose duties include the making of investment security, disclose to the public such information or, decisions or recommendations for fiduciary or if unable to do so (for example, in order to protect a agency accounts) should not have access to com corporate confidence), must abstain from trading in mercial credit files, government, agency, and or recommending such securities until the informa municipal securities underwriting files, or such tion is disclosed. Similarly, divulging confidential other files that the bank can reasonably determine material inside information only to one’s custom may contain material inside information; ers, who then act on the basis of the information, violates Federal securities law. 2. Trust personnel should not attend private meetings between or among personnel engaged in For a bank to purchase or sell, or recommend the commercial lending activities or in underwriting purchase or sale of, securities on the basis of government, agency, and municipal securities, on material inside information in the bank’s possession the one hand, and bank customers on the other, subjects the bank not only to injunctive suits and except where the sole purpose of the meeting is to criminal proceedings but also to civil damage suits seek a new customer relationship. by persons on the other side of the transactions. In such cases, liability may not be limited to the 3. Officers, directors, or employees of the bank persons on the other side of the transactions but should not serve simultaneously on any committee conceivably could extend to all persons who ef having responsibility for the making of investment fected transactions in the securities before the decisions or recommendations with respect to spe information became public; thus potential liability cific transactions and any committee having re could be substantial in terms of the amount of sponsibility for commercial lending or government, damages that may be awarded. agency, and municipal securities underwriting ac tivities, unless necessary to the circumstances of Accordingly, the Board of Governors will view the individual bank. the use of material inside information in connection with any decision or recommendation to purchase 4. All trust department employees should be or sell securities as an unsafe and unsound banking advised to report promptly to the management of practice. Furthermore, the Board expects each the trust department suspected material inside in State member bank that exercises investment dis formation, and upon a determination by that man cretion for the accounts of others to adopt written agement that the information is material, manage policies and procedures, suitable to its particular ment should promptly: (a) halt all trading by the circumstances, to ensure that such information in bank in the security or securities of the pertinent its possession is not misused. issuer and all recommendations thereof; (b) ascer tain the validity and nonpublic nature of the infor Because the size and organizational structure of mation with the issuer of the securities; (c) request individual banks that engage in investment ac the issuer or other appropriate parties to dissemi tivities vary widely, the Board does not believe that nate the information promptly to the public, if the it should, at this time, mandate the specific content information is valid and nonpublic; and (d) in the of policies and procedures to be adopted. The event the information is not publicly disseminated, Board believes, however, that in general such notify the bank’s legal counsel and request advice policies and procedures should limit those types of as to what further steps should be taken, including activity that are likely to give rise to an improper possible publication by the bank of the information, interchange of material inside information and es before transactions or recommendations in the se tablish a course of action for the bank to deal curities are resumed. affirmatively with such information that may come into the possession of personnel engaged in invest 5. A copy of the bank’s policies and procedures ment decision-making for the accounts of others. In should be furnished for each fiduciary or agency this connection, the Board urges each State account for which the bank exercises investment Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Announcements 341 discretion to the person having the power to termi know that there will be no further communications, nate the account or, if there is no such person, to or to tell the consumer what further efforts will be the persons to whom an accounting would ordinar made to close the case. ily be rendered. 6. Trust personnel should be separated physi •• Use payments made by the consumer as the cally from commercial lending personnel and gov consumer directs. ernment, agency, and municipal securities under The fact sheet pointed out that the act prohibits writing personnel to the extent appropriate to the abuse and harassment, such as threats of violence circumstances of the individual bank. or use of profane language by the debt collector; false and misleading statements, such as giving a FACT SHEET: Fair Debt false impression that documents are legal orders; Collection Practices Act and unfair practices such as misuse of postdated checks or communicating by post card. The fact sheet also drew attention to certain To assist State member banks in complying with the specific practices that are prohibited, including new Fair Debt Collection Practices Act, the Board contact by the debt collector with third parties, of Governors has issued a fact sheet and a set of such as employers, except to find out where the questions and answers describing the respon consumer lives; communication with the consumer sibilities of banks under the act. at work, if there is reason to believe the employer Similar fact sheets and questions and answers are does not allow such contact; and telephoning or being sent by the Federal Deposit Insurance Corpo meeting the consumer at any unusual time or place ration and the Office of the Comptroller of the except with the consumer’s agreement. Currency to banks supervised by those agencies. The act became effective March 20. It makes The fact sheet provides detailed guidance as to when a bank is a debt collector as defined in the act, abusive and deceptive debt collection practices and when it is not. Generally, the act applies to a illegal for all individuals or businesses defined by bank when it collects delinquent debts for others as the act as debt collectors. Generally, a debt collec a regular part of the bank’s business, or if it uses a tor, under the act, is anyone who regularly collects name other than its own in collecting debts on its or tries to collect—directly or indirectly—consumer own behalf. A bank is generally not subject to the act debt for someone else. when it is collecting debts on its own behalf in its Any consumer who believes a bank has violated own name. Bank trust department activities are gen the Fair Debt Collection Practices Act in attempting erally exempted by the act. to collect a debt from the consumer can lodge a complaint with the nearest Federal Reserve Bank or with the Federal Reserve Board in Washing REVIEW OF ton, D.C. 20551, in writing or by telephone. SEASONAL ADJUSTMENT The Federal Reserve will follow up on all such complaints—or refer them to the appropriate Fed TECHNIQUES eral bank regulatory agency if the complaint is not The Board of Governors announced on March 23, against a State member bank. Federal Reserve bank 1978, the formation of a committee of experts to examiners are being instructed to watch for any review the seasonal adjustment techniques used by evidence of violations of the act. the Board in adjusting financial data. Under the act, Federal bank regulatory agencies The committee will be chaired by Geoffrey H. may issue cease-and-desist orders to halt violations Moore of the National Bureau of Eco and may require affirmative corrective action. nomic Research in New York. Other members are The Board’s fact sheet noted that the act requires Professor George E. P. Box of the University of debt collectors to: Wisconsin, Madison; Hyman B. Kaitz, Alexandria, Virginia; Professor James A. Stephenson, Iowa State University, Ames; and Professor Arnold •• At the outset of the debt collection process, Zellner, University of Chicago. or within 5 days thereafter, notify the consumer in The committee has been requested to examine writing of the amount of the debt, the name of the the applicability of seasonal adjustment techniques creditor, and how the consumer may dispute the to financial data, with a view to recommending the debt. most appropriate methods to be used. The Board is •• Halt communications with a consumer upon especially concerned with seasonal adjustment of written request to do so, except to let the consumer weekly and monthly series for the monetary aggre Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
342 Federal Reserve Bulletin □ April 1978 gates, their components, and related bank reserve conform to court decisions. The Board requested and credit flows. comment by May 1, 1978. The committee will assess the usefulness of vari The Board has proposed another amendment to ous seasonal adjustment techniques, including Regulation Y that would set forth the rules by those presently employed by the Board and reason which nonbanking subsidiaries of U.S.-based bank able alternatives, in light of— holding companies may establish new foreign of 1. The high degree of volatility of many weekly, fices. The Board asked for comment by May 23, monthly, and even quarterly financial series. 1978. 2. The impact of monetary policy decisions on series, such as the money supply, that are closely related to policy. REVISED OTC STOCK LIST 3. The stability—or lack thereof—of the underly ing seasonal movement and the ability of seasonal The Board of Governors published a revised list of adjustment methods to develop reasonably reliable over-the-counter (OTC) stocks that are subject to seasonal factors for a year ahead. its margin regulations, effective March 31, 1978. 4. The desirability of mutually consistent behav The list supersedes the revised list of OTC mar ior for related seasonally adjusted series, such as gin stocks that was issued on August 15, 1977. bank reserves, deposits, and credit. Changes that have been made in the list, which now In its analysis, the committee will have available includes 1,128 OTC stocks, are as follows: the material on seasonal adjustment of the money •• 88 stocks have been included for the first time. supply prepared for the Advisory Committee on •• 14 stocks previously on the list have been Monetary Statistics that reported its conclusions to removed for substantially failing to meet the re the Board in June 1976. quirements for continued listing. •• 51 stocks have been removed because they are now listed on a national securities exchange or the companies were acquired by another firm. PROPOSED RULES This list is available on request from Publications The Board of Governors has proposed a revision of Services, Division of Administrative Services, the portion of its Regulation Y (Bank Holding Board of Governors of the Federal Reserve System, Companies) concerned with sale of insurance, to Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
343 Industrial Production Released for publication April 14 sive month. Coal production in the strike-affected mines resumed late in the month and contributed to Industrial production increased an estimated 1.4 the 1.0 per cent increase in output of energy mate per cent in March, following a revised 0.3 per cent rials. rise in February and an 0.8 per cent decline in January. Gains in output were widespread among Seasonally adjusted, ratio scale, 1967=100 products and materials. At 141.0 of the 1967 aver age, the March index was 4.2 per cent higher than a year earlier and nearly 1 per cent above the level in December 1977. However, industrial production in the first quarter of 1978 was only slightly higher than that in the fourth quarter of 1977—reflecting the effects of the severe winter weather and the lengthy coal strike. In March consumer goods increased 2.1 per cent, auto assemblies rose more than 13 per cent to an annual rate of 9.3 million units, and output of home goods advanced 1.9 per cent. Non durable consumer goods, such as food and clothing, also increased. Output of business equipment ad vanced 1.2 per cent to a level 8.2 per cent above that of March 1977, and production of construction supplies rose 1.1 per cent and was 10.9 per cent above the year-earlier level. Production of materials increased 1.2 per cent in March. Durable materials rose sharply following declines in both January and February; nondurable F.R. indexes, seasonally adjusted. Latest figures: March. materials increased strongly for the second succes- *Auto sales and stocks include imports. 1967 == 100* Percentage change from preceding month to— Percentage change Industrial production 1978 1977 1978 3/77 to Feb.p Mar/ Oct. Nov. | Dec. Jan. Feb. Mar. 3/78 Total .......................................... 139.0 141.0 .3 .3 .3 -.8 .3 1.4 4.2 Products, total ............................ 139.8 142.0 .1 .4 .6 -1.3 .9 1.6 5.1 Final products ........................ 136.7 139.1 -.2 .4 .4 -1.9 1.3 1.8 4.4 Consumer goods ................ 143.8 146.8 .0 .2 .4 -2.9 1.6 2.1 2.7 Durable goods ................ 151.4 159.2 .8 -1.0 .4 -6.0 3.4 5.2 4.5 Nondurable goods .......... 140.7 141.8 -.4 .8 .4 -1.5 .7 .8 1.9 Business equipment .......... 154.8 156.7 .3 .6 .3 -.7 1.2 1.2 8.2 Intermediate products ............ 151.4 152.6 .9 .4 1.3 .5 .1 .8 7.6 Construction Supplies ........ 149.5 151.2 1.2 1.1 1.2 .5 .3 1.1 10.9 Materials .............................. 137.8 139.5 .7 .1 -.1 .0 -.7 1.2 3.0 *Seasonally adjusted. p Preliminary. e Estimated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Al Financial and Business Statistics CONTENTS DOMESTIC FINANCIAL STATISTICS Weekly 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 A25 Gross demand deposits of individuals, Policy Instruments partnerships, and corporations A8 Federal Reserve Bank interest rates A9 Member bank reserve requirements Financial Markets A10 Maximum interest rates payable on A25 Commercial paper and bankers time and savings deposits at Federally acceptances outstanding insured institutions A26 Prime rate charged by banks on A10 Margin requirements short-term business loans A11 Federal Reserve open market A26 Terms of lending at commercial banks transactions A27 Interest rates in money and capital markets Federal Reserve Banks A28 Stock market—Selected statistics A12 Condition and F.R. note statements A13 Maturity distribution of loan and A29 Savings institutions—Selected assets security holdings and liabilities Monetary and Credit Aggregates Federal Finance A13 Bank debits and deposit 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 securities—Ownership, by maturity Commercial Bank Assets and Liabilities A34 U.S. Government securities dealers— A16 Last-Wednesday-of-month series Transactions, positions, and financing A17 Call-date series A35 Federal and Federally sponsored credit A18 Detailed balance sheet, June 30, 1977 agencies—Debt outstanding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A2 Federal Reserve Bulletin □ April 1978 Securities Markets and INTERNATIONAL STATISTICS Corporate 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 A38 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 A38 Business expenditures on new plant A60 Short-term claims on foreigners and equipment A61 Long-term claims on foreigners A39 Domestic finance companies—Assets and liabilities; business credit A62 Foreign branches of U.S. banks— Balance sheet data Real Estate A40 Mortgage markets Securities Holdings and Transactions A41 Mortgage debt outstanding A64 Marketable U.S. Treasury bonds and notes—Foreign holdings and Consumer Instalment Credit transactions A42 Total outstanding and net change A64 Foreign official assets held at F.R. A43 Extensions and liquidations banks A65 Foreign transactions in securities Flow of Funds Reported by Nonbanking Concerns in A44 Funds raised in U.S. credit markets the United States: A45 Direct and indirect sources of funds to 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 Interest and Exchange Rates A46 Output, capacity, and capacity 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—Indexes and gross value A69 GUIDE TO TABULAR PRESENTA A50 Housing and construction TION AND STATISTICAL RELEASES A51 Consumer and wholesale prices A52 Gross national product and income A53 Personal income and saving Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Domestic Financial Statistics A3 1.10 MONETARY AGGREGATES AND INTEREST RATES 1977 ' 1977 ' 1978 Item Ql Q2 Q3 Q4 Oct. Nov. Dec. Jan.r Feb. Monetary and credit aggregates (annual rates of change, seasonally adjusted in per cent)12 Member bank reserves 1 Total.................................................................................... 4.1 2.4 7.8 6.1 11.3 4.6 6.3 22.6 5.0 2 Required............................................................................. -1.6 2.9 7.3 6.3 11.3 3.2 8.3 20.2 5.8 3 Nonborrowed..................................................................... 4.0 1.3 2.2 3.4 -11.9 20.2 16.4 25.9 7.6 Concepts of money 1 4 M-l...................................................................................... 6.9 8.1 8.1 7.2 10.9 0.4 7.2 9.6 -1.1 5 M-2...................................................................................... 10.9 9.0 9.9 8.0 9.7 5.4 5.7 8.9 4.4 6 M-3...................................................................................... 12.2 10.2 11.9 10.6 11.8 7.8 7.6 8.7 5.5 Time and savings deposits Commercial banks: 7 Total................................................................................ 12.2 8.3 10.3 13.0 13.7 18.3 10.9 12.3 14.0 13.7 9.7 11.2 8.5 8.8 9.3 4.6 8.4 8.4 9 Thrift institutions 2............................................................ 14.1 11.9 15.0 14.4 14.6 11.2 10.3 8.5 7.2 10 Total loans and investments at commercial banks 3.......... 9.5 13.3 9.8 9.3 13.5 11.8 -0.7 12.1 10.1 1977 1978 1977 1978 Q2 Q3 Q4 Ql Nov. Dec. Jan. Feb. Mar. Interest rates (levels, per cent per annum) Short-term rates 11 Federal funds 4................................................................... 5.16 5.82 6.51 6.76 6.51 6.56 6.70 6.78 6.79 5.25 5.42 5.93 6.46 6.00 6.00 6.37 6.50 6.50 13 Treasury bills (3-month market yield) «........................... 4.84 5.50 6.11 6.39 6.10 6.07 6.44 6.45 6.29 14 Commercial paper (90- to 119-day) ?............................... 5.15 5.74 6.56 6.76 6.54 6.61 6.75 6.76 6.75 Long-term rates Bonds: 15 U.S. Govt.»..................................................................... 7.68 7.60 7.78 8.19 7.76 7.87 8.14 8.22 8.21 16 State and local government 9........................................ 5.70 5.59 5.57 5.65 5.49 5.57 5.71 5.62 5.61 17 Aaa utility (new issue) io.............................................. 8.21 8.09 8.27 8.70 8.27 8.34 8.68 8.69 8.71 18 Conventional mortgages 11............................................... 8.95 9.00 9.05 9.23 9.05 9.10 9.15 9.25 9.25 1 M-l equals currency plus private demand deposits adjusted. 7 Beginning Nov. 1977, unweighted average of offering rates quoted by M-2 equals M-l plus bank time and savings deposits other than large five dealers. Previously, most representative rate quoted by these dealers. negotiable certificates of deposit (CD’s). 8 Market yields adjusted to a 20-year maturity by the U.S. Treasury. M-3 equals M-2 plus deposits at mutual savings banks, savings and 9 Bond Buyer series for 20 issues of mixed quality. loan associations, and credit union shares. I o Weighted averages of new publicly offered bonds rated Aaa, Aa, 2 Savings and loan associations, mutual savings banks, and credit and A by Moody’s Investors Service and adjusted to an Aaa basis. unions. Federal Reserve compilations. 3 Quarterly changes calculated from figures shown in Table 1.23. II Average rates on new commitments for conventional first mortgages 4 Seven-day averages of daily effective rates (average of the rates on on new homes in primary markets, unweighted and rounded to nearest a given date weighted by the volume of transactions at those rates). 5 basis points, from Dept, of Housing and Urban Development. 5 Rate for the Federal Reserve Bank of New York. 12 Unless otherwise noted, rates of change are calculated from average ^ Quoted on a bank-discount rate basis. amounts outstanding in preceding month or quarter. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A4 Domestic Financial Statistics □ April 1978 1.11 FACTORS AFFECTING MEMBER BANK RESERVES Millions of dollars Monthly averages of daily Weekly averages of daily figures for weeks ending— figures Factors 1978 1978 Jan. Feb. Mar.p Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22^ Mar. 19p supplying reserve funds 1 Reserve Bank credit outstanding.... 118,598 115,227 114,860 114,732 115,247 113,276 112,763 112,254 116,483 117,230 ? 100,076 98,739 99,573 96,846 99,545 98,055 97,629 97.548 100,955 101,498 Bought outright......................... 99,544 98,032 98,436 96,451 98,517 97,719 97,275 97.548 99,585 99,058 4 Held under repurchase agree ment ....................................... 532 707 1,137 395 1,028 336 354 1,370 2,440 5 8,119 8,069 8,217 8,002 8,119 8,050 8,021 7.944 8,334 8,515 6 Bought outright......................... 8,004 7,982 7,948 7,982 7,982 7,982 7,982 7.944 7,935 7,929 7 Held under repurchase agree ment ....................................... 115 87 269 20 137 68 39 399 586 8 Acceptances................................... 178 106 279 63 135 82 27 378 573 9 Loans............................................. 481 405 344 281 446 391 395 248 281 386 10 Float.............................................. 7,065 5,347 4,273 6,566 4,878 4,551 4,719 4,482 4,123 4,011 11 Other Federal Reserve assets.... 2,679 2,561 2,174 2,974 2,123 2,147 1,973 2,032 2,412 2,248 12 Gold stock......................................... 11,719 11,718 11,718 11,718 11,718 11,718 11,718 11,718 11,718 11,718 13 Special Drawing Rights certificate account....................................... 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 14 Treasury currency outstanding........ 11,392 11,423 11,460 11,421 11,429 11,427 11,447 11,459 11,461 11,470 ABSORBING RESERVE FUNDS 15 Currency in circulation..................... 102,090 101,190 102,017 101,414 101,402 101,166 101,472 102,048 102,168 102,322 16 Treasury cash holdings..................... 395 389 394 389 390 389 391 393 395 396 Deposits, other than member bank reserves with F.R. Banks: 17 Treasury......................................... 7,519 5,707 4,705 5,018 4,670 4,068 4,278 2,555 5,394 6,528 335 297 30318 Fo2r9e5ign.........2..6.6...............3..5..0............ 330 311 263 282 19 Other2............................................ 839 772 740 754 668 862 637 830 797 676 20 Other F.R. liabilities and capital.... 3,652 3,926 3,962 3,953 4,213 3,877 3,603 4,207 4,148 3,907 21 Member bank reserves with F.R. Banks............................................. 28,129 27,337 27,167 27,298 28,035 26,961 26,468 26,338 27,748 27,558 End-of-month figures Wednesday figures 1978 1978 Jan. Feb. Mar.P Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22^ Mar. 29 p SUPPLYING RESERVE FUNDS 22 Reserve Bank credit outstanding.... 112,788 112,134 115,683 117,464 118,882 115,524 112,794 113,281 116,601 118,294 23 U.S. Govt, securities1....................... 97,004 98,450 101,577 99,508 101,282 99,091 96.165 96,777 100,747 102,443 24 Bought outright........................ 97,004 98,450 99,890 97,107 98,044 97,461 96.165 96,777 99,984 99,160 25 Held under repurchase agree- 1,687 2,401 3,238 1,630 763 3,283 26 Federal agency securities................. 8,004 7,982 8,193 8,116 8,446 8,401 7,982 7,938 8,189 8,761 27 Bought outright......................... 8,004 7,982 7,929 7,982 7,982 7,982 7,982 7,938 7,929 7,929 28 Held under repurchase agree- 264 134 464 419 260 832 29 770 349 453 354 181 607 30 Loans............................................. 758 304 331 599 318 826 783 413 356 363 31 Float.............................................. 4,083 3,499 2,484 6,591 6,410 4,860 5,869 6,082 4,810 3,801 32 Other Federal Reserve assets.... 2,939 1,899 2,328 2,301 1,973 1,992 1,995 2,071 2,318 2,319 33 Gold stock........................................ 11,718 11,718 11,718 11,718 11,718 11,718 11,718 11,718 11,718 11,718 34 Special Drawing Rights certificate account.......................................... 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 35 Treasury currency outstanding........ 11,380 11,396 11,480 11,429 11,432 11,435 11,457 11,461 11,464 11,480 ABSORBING RESERVE FUNDS 36 Currency in circulation.................... 100,819 101,369 102,426 101,707 101,597 101,429 102,061 102,406 102,471 102,728 37 Treasury cash holdings..................... 387 388 397 389 387 391 390 396 391 396 Deposits, other than member bank reserves with F.R. Banks: 38 Treasury........................................ 11,228 3,615 4,705 3,710 3,831 3,634 4,583 1,582 6,689 4,389 39 Foreign.......................................... 422 445 352 All 311 369 303 300 248 276 40 Other2............................................ 871 698 740 831 667 785 681 941 631 765 41 Other F.R. liabilities and capital... 4,109 3,933 3,860 4,093 3,907 4,015 3,759 4,578 3,901 3,889 42 Member bank reserves with F.R. Banks............................................. 19,301 26,047 27,651 30,704 32,582 29,305 25,443 27,507 26,703 30,299 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
Member Banks A5 1.12 RESERVES AND BORROWINGS Member Banks Millions of dollars Monthly averages of daily figures Reserve classification 1976 1977 1978 Dec. July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar.P All member banks Reserves: At F.R. Banks..................... 26,430 26,663 26,373 26,152 26,933 26,783 27,057 28,129 27,337 27,167 Currency and coin............. 8,548 8,622 8,712 8,887 8,820 8,932 9,351 9,980 9,320 8,996 Total held1........................... 35,136 35,391 35,186 35,156 35,860 35,782 36,471 38,185 36,738 36,247 Required........................... 34,964 35,043 34,987 34,965 35,521 35,647 36,297 37,880 36,605 35,939 Excess1.............................. 172 348 199 191 339 135 174 305 133 308 Borrowings at F.R. Banks:2 Total...................................... 62 336 1,071 634 1,319 840 558 481 405 344 Seasonal................................ 12 60 101 112 114 83 54 32 52 47 Large banks in New York City Reserves held........................... 6,520 6,359 6,272 6,025 6,175 6,181 6,244 6,804 6,563 6,219 Required............................... 6,602 6,342 6,247 6,022 6,120 6,175 6,279 6,775 6,584 6,193 Excess.................................... -82 17 25 3 55 6 -35 29 -21 26 Borrowings2............................. 15 74 157 75 133 132 48 77 12 21 Large banks in Chicago Reserves held............................ 1,632 1,573 1,653 1,655 1,666 1,607 1,593 1,733 1,623 1,602 Required............................... 1,641 1,606 1,622 1,634 1,656 1,609 1,613 1,684 1,633 1,620 Excess.............-.................... -9 -33 31 21 10 -2 -20 49 -10 -18 Borrowings2............................. 4 6 5 12 24 23 26 14 11 Other large banks Reserves held............................ 13,117 13,438 13,290 13,362 13,711 13,607 13,993 14,487 13,867 13,639 Required................................ 13,053 13,286 13,270 13,355 13,598 13,602 13,931 14,504 13,861 13,661 Excess.................................... 64 152 20 7 113 5 62 -17 6 -22 Borrowings2............................. 14 79 530 183 681 355 243 164 150 93 All other banks Reserves held............................ 13,867 14,021 13,971 14,114 14,308 14,387 14,641 15,161 14,685 14,560 Required................................ 13,668 13,809 13,848 13,954 14,147 14,261 14,474 14,917 14,527 14,465 Excess.................................... 199 212 123 160 161 126 167 244 158 95 Borrowings2............................. 29 177 379 364 481 330 241 226 243 219 Weekly averages of daily figures for weeks ending— 1978 Jan. 25 Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22p Mar. 29? All member banks Reserves: At F.R. Banks................... 27,893 27,479 27,423 27,298 28,035 26,961 26,468 26,338 27,748 27,558 Currency and coin............ 10,119 9,893 9,803 9,723 8,554 9,085 9,111 9,558 8,464 8,852 Total held1......................... 38,091 37,450 37,304 37,098 36,672 36,132 35,664 35,981 36,295 36,491 Required......................... 37,776 37,292 36,934 36,913 36,380 36,012 35,400 35,850 36,128 36,256 Excess1........................... 315 158 370 185 292 120 264 131 167 235 Borrowings at F.R. Banks:2 Total...................................... 592 470 493 281 446 391 395 248 281 386 Seasonal............................. 36 44 49 49 53 .58 47 41 47 51 Large banks in New York City 31 Reserves held......................... 6,566 6,606 6,667 6,687 6 ,734 6,213 5,964 6,420 6,168 6,188 32 Required............................. 6,563 6,558 6,680 6,683 6,692 6,233 5,990 6,334 6,229 6,199 33 Excess................................. 3 48 -13 4 42 -20 -26 86 -61 -11 34 Borrowings2........................... 211 14 36 11 77 5 Large banks in Chicago Reserves held.............. 1,643 1.630 1,685 1.701 1,591 1,550 1,573 1,628 1,595 1,720 Required................. 1,661 1.630 1,668 1.702 1,589 1,565 1,559 1,621 1,618 1,648 Excess..................... -18 17 -1 2 -15 14 7 -53 72 Borrowings2............... 19 49 Other large banks 39 Reserves held... 14,526 14,185 14,151 14,047 13,671 13.692 13,607 13,432 13,881 13,441 40 Required....... 14,490 14,239 13,962 14,092 13,595 U,l\9 13,476 13,537 13,745 13,832 41 Excess............ 36 -54 189 -45 76 -27 131 -105 136 -391 42 Borrowings 2.... 138 178 237 70 177 60 82 83 71 131 All other banks 43 Reserves held. 15,356 15,029 14,801 14,663 14,676 14,677 14,520 14,501 14,634 14,604 44 Required... 15,062 14,865 14,624 14,436 14,504 14,495 14,375 14,358 14,506 14,577 45 Excess........ 294 164 177 227 172 182 145 143 128 27 46 Borrowings2.. 224 292 242 175 269 271 236 160 210 255 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 □ April 1978 1.13 FEDERAL FUNDS TRANSACTIONS Money Market Banks Millions of dollars, except as noted 1978, week ending— Type Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 Total, 46 banks Basic reserve position 1 Excess reserves1............................. 3 170 ' 122 ' 117 4 109 4 26 144 Less: 2 Borrowings at F.R. Banks........ 76 221 54 102 50 77 4 6 42 3 Net interbank Federal funds transactions......................... 15,436 18,143 18,273 17,604 16,450 18,764 19,309 19,027 14,849 Equals : Net surplus, or deficit (—): 4 Amount....................................... -15,508 -18,193 r —18,204 r —17,589 -16,496 -18,732 -19,309 -19,007 -14,748 5 Per cent of average required reserves................................ 98.3 115.2 114.0 113.4 108.6 126.8 127.2 124.3 96.7 Interbank Federal funds transactions Gross transactions: Purchases.................................... 22,456 25,246 25,118 25,101 23,555 26,121 25,948 26,936 23,573 Sales............................................ 7,020 7,103 6,845 7,497 7,106 7,357 6,639 7,909 8,724 Two-way transactions2.................. 5,351 5,671 5,990 6,078 5,364 5,531 4,673 4,920 5,419 Net transactions: Purchases of net buying banks.. 17,105 19,575 19,128 19,024 18,191 20,590 21,275 22,016 18,155 Sales of net selling banks........... 1,669 1,432 855 1,420 1,741 1,827 1,967 2,989 3,306 Related transactions with U.S. Govt, securities dealers 11 Loans to dealers 3.................. 4,451 3,719 4,308 2,937 2,891 4,120 4,601 3,360 2,147 12 Borrowing from dealers4... 2,462 2,091 1,946 2,474 1,899 1,787 1,757 2,184 2,780 13 Net loans............................... 1,990 1,628 2,362 464 993 2,333 2,844 1,176 -633 8 banks in New York City Basic reserve position 14 Excess reserves1........................... 52 23 4 45 14 -6 30 -20 43 15 Le B ss o : rrowings at F.R. Banks 14 36 77 16 Net interbank Federal funds transactions....................... 4,045 5,065 4,874 5,286 4,849 6,848 7,567 7,505 5,552 Equals: Net surplus, or deficit (—): 17 Amount..................................... -3,993 -5,056 -4,906 -5,241 -4,836 -6,932 -7,537 -7,525 -5,510 18 Per cent of average required reserves.............................. 67.3 83.2 80.6 85.4 84.7 126.8 130.5 132.2 97.9 Interbank Federal funds transactions Gross transactions: Purchases.................................... 5,032 6,432 6,121 6,665 5,891 7,525 8,216 8,235 6,175 Sales............................................ 988 1,367 1,247 1,379 1,042 677 650 730 623 Two-way transactions2.................. 988 1,194 1,246 1,279 830 677 649 730 623 Net transactions: Purchases of net buying banks.. 4,045 5,238 4,874 5,386 5,061 6,848 7,567 7,505 5,552 Sales of net selling banks.......... 173 100 212 Related transactions with U.S. Govt, securities dealers 24 Loans to dealers3........................... 2,250 2,283 1,941 1,580 1,484 2,340 2,620 1,874 1,015 25 Borrowing from dealers4.............. 1,224 1,068 973 1,287 926 966 971 1,003 1,228 26 Net loans........................................ 1,026 1,215 968 294 558 1,374 1,650 871 -213 38 banks outside New York City Basic reserve position 27 Excess reserves1............................. -49 146 *•119 r 72 -10 115 -26 46 101 Less: 28 Borrowings at F.R. Banks........ 76 206 18 102 50 4 6 42 29 Net interbank Federal funds transactions......................... 11,391 13,077 13,399 12,318 11,600 11,915 11,742 11,522 9,297 Equals: Net surplus, or deficit (-): * 30 Amount...................................... . -11,516 -13,137 *■-13,298 r —12,348 -11,660 -18,732 -11,772 -11,482 -9,238 31 Per cent of average required reserves............................... 117.1 135.2 134.5 131.7 126.7 126.8 125.2 119.6 96.0 Interbank Federal funds transactions Gross transactions: Purchases.................................... 17,423 18,814 18,997 18,436 17,664 18,596 17,732 18,701 17,399 Sales............................................ 6,032 5,737 5,598 6,118 6,064 6,680 5,990 7,179 8,012 Two-way transactions2.................. 4,363 4,478 4,744 4,798 4,534 4,854 4,024 4,190 4,796 Net transactions: Purchases of net buying banks.. 13,060 14,336 14,253 13,638 13,130 13,742 13,708 14,511 12,603 Sales of net selling banks.......... 1,669 1,259 855 1,320 1,529 1,827 1,967 2,989 3,306 Related transactions with U.S. Govt, securities dealers 37 Loans to dealers3.................. 2,201 1,436 2,368 1,357 1,407 1,780 1,981 1,487 1,132 38 Borrowing from dealers4.... 1,238 1,023 973 1,187 973 821 787 1,181 1,552 39 Net loans............................... 963 413 1,395 170 435 959 1,194 306 -420 For notes see end of table. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Federal Funds Al 1.13 Continued 1978, week ending- Type Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 5 banks in City of Chicago Basic reserve position 40 Excess reserves1.......................... -1 20 -1 12 15 66 Less: 41 Borrowings at F.R. Banks... 49 42 Net interbank Federal funds transactions..................... 5,492 5,926 6,180 5,535 5,377 5,433 5,172 5,806 5,053 Equals: Net surplus, or deficit (—): 43 Amount................................. -5,493 -5,906 -6,163 -5,528 -5,427 -5,421 -5,157 -5,804 -4,988 44 Per cent of average required reserves............................ 361.6 379.4 387.7 373.8 372.3 373.7 340.8 377.2 323.9 Interbank Federal funds transactions Gross transactions: 45 Purchases.................................... 6,714 7,063 7,056 6,931 6,420 6,660 6,053 6,889 6,590 46 Sales............................................ 1,222 1,138 876 1,396 1.043 1.227 882 1.083 1.536 47 Two-way transactions2................. 1,184 1,118 873 1,370 1.043 1.227 882 1.083 1.536 Net transactions: 48 Purchases of net buying banks.. 5,530 5,946 6,183 5,561 5,377 5,433 5,171 5,806 5,054 49 Sales of net selling banks.......... 38 20 3 26 Related transactions with U.S. Govt, securities dealers 50 Loans to dealers 3................. 341 253 283 242 254 390 426 357 255 51 Borrowing from dealers4... 463 230 263 423 333 256 242 313 596 52 Net loans............................... -122 23 20 -182 -79 135 183 44 -342 33 other banks Basic reserve position 53 Excess reserves1......................... -47 127 r 102 r65 -9 103 -47 44 35 54 Le B ss o : rrowings at F.R. Banks... 76 206 18 102 1 4 6 42 55 Net interbank Federal funds transactions..................... 5,899 7,152 7,219 6,783 6,223 6,483 6,570 5,716 4,243 Equals: Net surplus, or deficit (—): 56 Amount................................. -6,022 -7,231 -7,136 r—6,820 -6,232 -6,379 6,615 -5,678 -4,251 57 Per cent of average required reserves............................ 72.4 88.6 86.0 86.3 77.7 81.2 83.9 70.5 52.6 Interbank Federal funds transactions Gross transactions: Purchases.................................... 10,709 11,751 11,941 11,505 11,244 11,936 11,679 11,812 10,809 Sales.............................................. 4,810 4,599 4,122 4,722 5,021 5,453 5,108 6,097 6,565 Two-way transactions2................. 3,179 3,360 3,871 3,428 3,491 3,627 3,143 3,108 3,260 Net transactions: Purchases of net buying banks.., 7,531 8,391 8,070 8,077 7,752 8,309 8,536 8,705 7,549 Sales of net selling banks........... 1,631 1,239 852 1,294 1,529 1,827 1,967 2,989 3,306 Related transactions with U.S. Govt, securities dealers 63 Loans to dealers3........................... 1,860 1,184 2,085 1,116 1,153 ,389 1,555 1,130 877 64 Borrowing from dealers4.............. 775 793 710 764 640 565 544 868 956 65 Net loans........................................ 1,086 391 1,375 352 513 824 1,011 261 -79 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 policy clearing banks, reverse repurchase agreements (sales of securities to of the Board of Governors 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 August 1964 Bulletin, pp. 944-53. Back data for 46 banks appear banks, repurchase agreements (purchases from dealers subject to resale), in the Board’s Annual Statistical Digest, 1971-1975, Table 3. or other lending arrangements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A8 Domestic Financial Statistics □ April 1978 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 Sec. 13, last par.4 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 3/31/78 date rate 3/31/78 date rate 3/31/78 date rate 3/31/78 date rate Boston.................... 6% 1/10/78 6 7 1/10/78 6% m 1/10/78 7 9% 1/10/78 9 New York............. 6% 1/9/78 6 7 1/9/78 6% 7% 1/9/78 7 9% 1/9/78 9 Philadelphia.......... 6% 1/20/78 6 7 1/20/78 6% m 1/20/78 7 9% 1/20/78 9 Cleveland............... 6% 1/20/78 6 7 1/20/78 6% m 1/20/78 7 9% 1/20/78 9 Richmond............. 6% 1/13/78 6 7 1/13/78 6% 7% 1/13/78 7 9% 1/13/78 9 Atlanta................... 6% 1/16/78 6 7 1/16/78 6% m 1/16/78 7 9% 1/16/78 9 Chicago.................. 6% 1/9/78 6 7 1/9/78 6% m 1/9/78 7 9% 1/9/78 9 St. Louis................ 6% 1/13/78 6 7 1/13/78 6% 7% 1/13/78 7 9% 1/13/78 9 Minneapolis.......... 6% 1/10/78 6 7 1/10/78 6% m 1/10/78 7 9% 1/10/78 9 Kansas City.......... 6% 1/10/78 6 7 1/10/78 6% 7% 1/10/78 7 9% 1/10/78 9 Dallas..................... 6% 1/13/78 6 7 1/13/78 6% 7% 1/13/78 7 9% 1/13/78 9 San Francisco.... 6% 1/13/78 6 7 1/13/78 6% m 1/13/78 7 9% 1/13/78 9 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% 5% 1973—Jan. 15................... 5 5 1975—Jan. 6................... 714-734 734 Feb. 26................... 5-5% 53%8 10................... 714-734 714 1971—Jan. 8............. 5%-5% 514 Mar. 2................... 5% 24................... 714 714 15............. 51/4 514 Apr. 23................... 5 Vi-5 34 i* Feb. 5................... 634-714 634 19............. 5 -514 5% May 4................... 5Ya 7................... 634 634 22............. 5 -5% 5 11................... 53^-6 Mar. 10................... 614-634 614 29............. 5 5 18................... 6 14................... 614 614 Feb. 13............. 4%-5 5 June 11................... 6-6 % 6% May 16................... 6-614 6 19............. 434 434 15................... 6 % 6% 23................... 6 6 July 16............. 434-5 5 July 2................... 7 7 2 3 5 5 Aug. 14................... 7-7% 7% 1976—Jan. 19................... 5%-6 5% Nov. 11............ 434-5 5 23................... 7% 7% 23................... 5% 5% 19............. 434 434 Nov. 22................... 514-5% 514 Dec. 13............. 4%-434 434 1974—Apr. 25................... 7%-8 8 26................... 514 514 17............. 4%-434 4% 30................... 8 8 2 4 4% 4% Dec. 9................... 7%-8 m 1977—Aug. 30................... 514-534 5% 16................... m m 31................... 514-534 534 Sept. 2................... 534 534 Oct. 26................... 6 6 1978—Jan. 9................... 6-6% 6% 20................... 6% 6% In effect Mar. 31, 1978. .. 6% 6% 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, Annual Statistical Digest, 1971-75, and Annual Statistical Digest, 1972-76. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Policy Instruments A9 1.15 MEMBER BANK RESERVE REQUIREMENTS1 Per cent of deposits Requirements in effect Previous requirements Mar. 31, 1978 Type of deposit, and deposit interval in millions of dollars Per cent Effective date Per cent Effective date Net demand:2 0-2............................................................................................................ 7 12/30/76 m 2/13/75 2-10......................................................................................................... 9% 12/30/76 10 2/13/75 10-100..................................................................................................... 113^ 12/30/76 12 2/13/75 100-400................................................................................................... 1234 12/30/76 13 2/13/75 Over 400................................................................................................. 161/4 12/30/76 16 % 2/13/75 Time:2-3 Savings..................................................................................................... 3 3/16/67 3% 3/2/67 Other time: 0-5, maturing in— 30-179 days................................................................................... 3 3/16/67 3% 3/2/67 180 days to 4 years...................................................................... 4 2 % 1/8/76 3 3/16/67 4 years or more............................................................................. 4 1 10/30/75 3 3/16/67 Over 5, maturing in— 30-179 days.................................................................................... 6 12/12/74 5 10/1/70 180 days to 4 years...................................................................... 4 2 % 1/8/76 3 12/12/74 4 years or more............................................................................. 41 10/30/75 3 12/12/74 Legal limits, Mar. 31, 1978 Minimum Maximum Net demand: Reserve city banks................................................................................ 10 22 Other banks........................................................................................... 7 14 Time............................................................................................................. 3 10 1 For changes in reserve requirements beginning 1963, see Board’s (c) The Board’s Regulation M requires a 4 per cent reserve against net Annual Statistical Digest, 1971-1975 and for prior changes, see Board’s balances due from domestic banks to their foreign branches and to foreign Annual Report for 1976, Table 13. banks abroad. Effective Dec. 1, 1977, a 1 per cent reserve is required 2 (a) Requirement schedules are graduated, and each deposit interval against deposits that foreign branches of U.S. banks use for lending to applies to that part of the deposits of each bank. Demand deposits U.S. residents. Loans aggregating $100,000 or less to any U.S. resident are subject to reserve requirements are gross demand deposits minus cash excluded from computations, as are total loans of a bank to U.S. residents items in process of collection and demand balances due from domestic if not exceeding $1 million. Regulation D imposes a similar reserve re banks. quirement on borrowings from foreign banks by domestic offices of a (b) The Federal Reserve Act specifies different ranges of requirements member bank. 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 □ April 1978 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 Mar. 31,1978 Previous maximum In effect Mar. 31,1978 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 5% (6) 5 (7) 2 Negotiable order of withdrawal (NOW) accounts *. ..................................... 5 1/1/74 5 1/1/74 Time (multiple- and single-maturity unless otherwise indicated):2 30-89 days: 4 Single-maturity...................................... J \ 5 5 7/1/73 / \ 4 5 Vi 9 1 / / 2 2 6 1 / / 6 7 6 0 } (8) (8) 90 days to 1 year: 6 5 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 .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . } 51/2 7/1/73 5 _ ( f 9 7 / / 2 2 6 0 / / 6 66 6 } 35% (6) 5% 1/21/70 7 8 2 1 t t o o 2 2 V y i e y ar e s a 3 rs .. 3 .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . } 6 7/1/73 \ J 5 5 V y4 i 1 1 / /2 21 1/ / 7 7 0 0 } 6 Vi (6) J 534 1 1 / / 2 2 1 1 / / 7 7 0 0 9 2Vi to 4 years3........................................... 6Vi 7/1/73 sy4 1/21/70 6% (6) 1 t 1/21/70 10 4 to 6 years4 .......................................... 71/4 11/1/73 (9) 7Vi 11/1/73 (9) 11 6 years or more4........................................ 7Vi 12/23/74 m 11/1/73 m 12/23/74 m 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 13 Individual retirement accounts and Keogh (H.R. 10) plans 5............... m 7/6/77 (8) 7Va 7/6/77 (8) 1 For authorized States only. Federally insured commercial banks, 9 Between July 1, 1973, and Oct. 31, 1973, there was no ceiling for savings and loan associations, cooperative banks, and mutual savings certificates maturing in 4 years or more with minimum denominations banks were first permitted to offer NOW accounts on Jan. 1, 1974. of $1,000; however, the amount of such certificates that an institution Authorization to issue NOW accounts was extended to similar institu could issue was limited to 5 per cent of its total time and savings deposits. tions throughout New England on Feb. 27, 1976. Sales in excess of that amount, as well as certificates of less than $1,000, 2 For exceptions with respect to certain foreign time deposits see the were limited to the 6 Vi per cent ceiling on time deposits maturing in 2Vi Federal Reserve Bulletin for October 1962 (p. 1279), August 1965 (p. years or more. 1094), and February 1968 (p. 167). Effective Nov. 1, 1973, the present ceilings were imposed on certificates 3 A minimum of $1,000 is required for savings and loan associations, maturing in 4 years or more with minimum denominations of $1,000. except in areas where mutual savings banks permit lower minimum de There is no limitation on the amount of these certificates that banks can nominations. This restriction was removed for deposits maturing in less issue. than 1 year, effective Nov. 1, 1973. 4 $1,000 minimum except for deposits representing funds contributed Note—Maximum rates that can be paid by Federally insured commer to an Individual Retirement Account (IRA) or a Keogh (H.R. 10) Plan es cial banks, mutual savings banks, and savings and loan associations are tablished pursuant to the Internal Revenue Code. The $1,000 minimum established by the Board of Governors of the Federal Reserve System, requirement was removed for such accounts in December 1975 and No the Board of Directors of the Federal Deposit Insurance Corporation, vember 1976, respectively. and the Federal Home Loan Bank Board under the provisions of 12 5 3-year minimum maturity. CFR 217, 329, and 526, respectively. The maximum rates on time de 6 July 1, 1973, for mutual savings banks; July 6, 1973, for savings and posits in denominations of $100,000 or more were suspended in midloan associations. 1973. For information regarding previous interest rate ceilings on all 7 Oct. 1, 1966, for mutual savings banks; Jan. 21, 1970, for savings and types of accounts, see earlier issues of the Federal Reserve Bulletin, loan associations. the Federal Home Loan Bank Board Journal, and the Annual Report 8 No separate account category. 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 Instruments All 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS Millions of dollars 1977 1978 Type of transaction 1975 1976 1977 Aug. Sept. Oct. Nov. Dec. Jan. Feb, U.S. GOVT. SECURITIES Outright transactions (excl. matched salepurchase transactions) Treasury bills: 1 Gross purchases. 11,562 14,343 13,738 812 2,005 3,109 696 379 2 Gross sales........... 5,599 8,462 7,241 176 303 1,877 436 311 1,323 1,974 3 Redemptions 26,431 2 5,017 2,136 317 300 1,100 Others within 1 year:1 Gross purchases..................... 3,886 472 3,017 2,616 56 Gross sales............................... Exchange, or maturity shift. -4 792 4.499 2,321 320 -45 1,352 -511 -653 Redemptions......................... 3,549 2.500 2,500 1 to 5 years: 8 Gross purchases..................... 2 3,284 2 3,202 2,833 681 628 311 9 Gross sales............................. 177 10 Exchange, or maturity shift. 3,854 -2,588 -6,649 -1,664 -320 45 -1,267 -623 511 1,109 5 to 10 years: 11 Gross purchases.................... 1,510 1,048 758 96 166 89 12 Gross sales............................. 13 Exchange, or maturity shift. -4,697 1,572 584 -782 -325 -906 Over 10 years: 14 Gross purchases.................... 1,070 642 553 128 108 100 15 Gross sales.............................. 16 Exchange, or maturity shift. 848 225 1,565 125 450 All maturities:1 17 Gross purchases. 221,313 219,707 20,898 812 5,526 4,110 1,252 379 18 Gross sales........... 5,599 8,639 7,241 176 303 1.877 436 311 1,323 1,974 19 Redemptions 29,980 25,017 4,636 317 2,500 300 1,100 Matched sale-purchase transactions 20 Gross sales........................................ 151,205 196,078 425,214 45,831 39,552 48,204 56,899 32,320 54,859 40,128 21 Gross purchases.............................. 152,132 196,579 423,841 46,170 39,694 44,772 57,477 35,001 51,016 44,270 Repurchase agreements 22 Gross purchases 140,311 232,891 178,683 4,397 16,700 9.578 6,472 18,071 10,229 16.057 23 Gross sales................. 139,538 230,355 180,535 5,648 15,469 11,889 4,433 18,208 12,130 16.057 24 Net change in U.S. Govt, securities.......... 7,434 9,087 5,798 -276 6,279 -10,118 6,342 -5,815 1,447 FEDERAL AGENCY OBLIGATIONS Outright transactions: 25 Gross purchases............................................. 1,616 891 1,433 707 26 Gross sales....................................................... 27 Redemptions................................................... 246 169 223 69 25 22 Repurchase agreements: 28 Gross purchases............................................. 15,179 10,520 13,811 265 1,136 741 615 2,712 1,680 1.966 29 Gross sales....................................................... 15,566 10,360 13,638 459 978 1,051 484 2,392 2,131 1.966 BANKERS ACCEPTANCES 30 Outright transactions, net. .. 163 -545 -196 -15 -4 31 Repurchase agreements, net. -35 410 159 -247 351 -478 248 705 -954 32 Net change in total System Account. 8,539 9,833 7,143 -801 6,764 -10,910 2,260 8,042 -7,220 1,425 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): 1975, 3,549: 1976, none; Sept. 1977, 2,500. Note.—Sales, redemptions, and negative figures reduce holdings of 2 In 1975, the System obtained $421 million of 2-year Treasury notes the System Open Market Account; all other figures increase such holdings. in exchange for maturing bills. In 1976 there was a similar transaction 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 □ April 1978 1.18 FEDERAL RESERVE BANKS Condition and F.R. Note Statements Millions of dollars Wednesday End of month Account 1978 1978 Mar. 1 Mar. 8 Mar. 15 Mar. 22** Mar. 29^ Jan. Feb. Consolidated condition statement ASSETS 1 Gold certificate account................................ 11,718 11,718 11,718 11,718 11,718 11,718 11,718 11,718 2 Special Drawing Rights certificate account. 1,250 1.250 1,250 1,250 1,250 1,250 1,250 1,250 3 Coin1............................................................. 338 332 330 329 320 334 339 323 Loans: 4 Member bank borrowings................. 826 783 413 356 363 758 304 331 5 Other....................................................... Acceptances: 6 Bought outright.................................... 7 Held under repurchase agreements., 354 181 607 770 Federal agency obligations: 8 Bought outright.................................... 7,982 7,982 7,938 7,929 7,929 8,004 7,982 7,929 9 Held under repurchase agreements. 419 260 832 264 U.S. Govt, securities Bought outright: 10 Bills..................................................... 37,547 36,251 36,863 39,046 38,222 37,090 38,536 38,358 11 Certificates—Special....................... 12 Other......................... 13 Notes.................................................. 50,516 50,516 50,516 51,486 51,486 50.965 50,516 51,984 14 Bonds................................................. 9,398 9,398 9,398 9.452 9,452 8,949 9,398 9,548 15 Total2.................................................... 97,461 96,165 96,777 99j984 99,160 97,004 98,450 99,890 16 Held under repurchase agreements. 1,630 763 3,283 1,687 17 Total U.S. Govt, securities. 99,091 96,165 96,777 100,747 102,443 97,004 98,450 101,577 18 Total loans and securities.. 108,672 104,930 105,128 109,473 112,174 105,766 106,736 110,871 19 Cash items in process of collection..., 11,459 11,924 12,738 10,843 9,577 10,999 10,489 8,106 20 Bank premises....................................... 381 383 383 384 385 379 380 385 Other assets: 21 Denominated in foreign currencies. 369 303 300 248 276 422 445 352 22 All other............................................ 1,242 1,309 1,388 1,686 1,658 2,138 1,074 1,591 23 Total assets. 135,429 132,149 133,235 135,931 137,358 133,006 132,431 134,596 LIABILITIES 24 F.R. notes.......................................... 90,722 91,325 91,671 91,726 91,964 90,159 90,703 91,666 Deposits: 25 Member bank reserves................. 29,305 25,443 27,507 26,703 30,299 19,301 26,047 27,651 26 U.S. Treasury—General account. 3,634 4,583 1,582 6,689 4,389 11,228 3,615 4,705 27 Foreign.......................................... 369 303 300 248 276 422 445 352 28 Other 3............................................ 785 681 941 631 765 871 698 740 29 Total deposits. 34,093 31,010 30,330 34,271 35,729 31,822 30,805 33,448 30 Deferred availability cash items........... 6,599 6,055 6,656 6,033 5,776 6,916 6,990 5,622 31 Other liabilities and accrued dividends. 1,396 1,519 2,209 1,393 1,302 1,474 1,328 1,234 32 Total liabilities................................... 132,810 129,909 130,866 133,423 134,771 130,371 129,826 131,970 CAPITAL ACCOUNTS 33 Capital paid in....................................................... 1,042 1,044 1,046 1,046 1,048 1,039 1,044 1 047 34 Surplus.................................................................... 1,029 1,029 1,029 1,029 1,029 1,029 1,029 1,029 35 Other capital accounts.......................................... 548 167 294 433 510 567 532 550 36 Total liabilities and capital accounts..................... 135,429 132,149 133,235 135,931 137,358 133,006 132,431 134,596 37 Memo: Marketable U.S. Govt, securities held in custody for foreign and inti, account............. 83,522 84,692 86,193 87,982 88,336 80,009 83,261 88,965 Federal Reserve note statement 38 F.R. notes outstanding (issued to Bank)............. 102,854 103,021 103,142 103,262 103,431 102,355 102,773 103,427 Collateral held against notes outstanding: 39 Gold certificate account..................................... 11,718 11,718 11,718 11,718 11,718 11,718 11,718 11,718 40 Special Drawing Rights certificate account.... 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 41 662 750 396 338 333 733 292 309 42 89,224 89,303 89,778 89,956 90,130 88,654 89,513 90,150 43 102,854 103,021 103,142 103,262 103,431 102,355 102,773 103,427 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 scheduled to be bought back under matched sale-purchase transactions. to “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 1978 1978 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 Jan. 31 Feb. 28 Mar. 31 825 783 413 356 363 757 303 331 812 765 353 344 356 740 294 315 3 16 days to 90 days.................................................... 13 18 60 12 7 17 9 16 5 Acceptances ............................................................. 354 181 607 770 6 Within 15 days ............................................... 354 181 607 770 99,091 96,165 96,777 100,747 102,443 97,004 98,450 101,577 4,536 2,060 2,907 5.341 6,967 5,836 2,512 4,642 19.020 17,829 17,468 17,914 18,849 13,155 19,549 19,400 12 91 days to 1 year....................................................... 29;523 30,264 30,390 30,703 29,838 32,654 30,377 30,454 28,824 28,824 28,824 29,272 29,272 27,715 28,824 29,376 9,571 9,571 9,571 9.846 9,846 10.477 9,571 9,941 15 Over 10 years............................................................ 7,617 7,617 7,617 7,671 7,671 7,167 7,617 7,764 16 Federal agency obligations.......................................... 8,401 7,982 7,938 8,189 8,761 8,004 7,982 8,193 17 Within 15 days1........................................................ 588 178 9 301 873 65 222 305 140 176 274 233 233 375 140 233 19 91 days to 1 year....................................................... 1,180 1,158 1,111 1,110 1,110 865 1,127 1,110 20 Over 1 year to 5 years............................................. 3,954 3,931 4,043 4,044 4,044 4,175 3,954 4,044 21 Over 5 years to 10 years......................................... 1,659 1,659 1,621 1,624 1,624 1,623 1,659 1,624 880 880 880 877 877 901 880 877 1 Holdings under repurchase agreements are classified as maturing within 15 days in accordance with maximum maturity of the agreements. 1.20 BANK DEBITS AND DEPOSIT TURNOVER Debits are shown in billions ot dollars. Monthly data are at annual rates. 1977 1978 Bank group, or type 1974 1975 1976 of customer Oct.r Nov.r Dec.r Jan. Feb. Debits to demand deposits 2 (seasonally adjusted) 1 All commercial banks................ 22,937.8 25,028.5 29,180.4 35,319.0 36,253.5 36,427.2 36,923.3 36,156.1 2 Major New York City banks.. 8,434.8 9,670.7 11,467.2 14,960.0 14,216.3 14,651.4 14,432.0 13,483.1 3 Other banks.................................. 14,503.0 15,357.8 17,713.2 20,359.0 22,037.3 21,775.8 22,491.3 22,672.9 Debits to savings deposits 3 (not seasonally adjusted) 4 All customers................................ 355.1 326.0 353.8 392.6 328.7 5 Business 1...................................... 42.0 42.2 49.5 48.7 4.01 6 Others............................................. 313.2 283.8 304.3 343.8 288.6 Demand deposit turnover 2 (seasonally adjusted) 7 All commercial banks................. 99.0 105.3 116.8 127.8 131.4 131.0 131.5 129.4 8 Major New York City banks. . 321.6 356.9 411.6 533.3 524.4 539.9 512.2 496.4 9 Other banks.................................. 70.6 72.9 79.8 82.0 88.6 86.8 89.0 89.9 Savings deposit turnover 3 (not seasonally adjusted) 10 All customers................................ 1.6 1.5 1.6 1.8 1.5 11 Business 1...................................... 4.0 3.9 4.6 4.7 3.9 12 Others............................................. 1.5 1.4 1.5 1.7 1.4 1 Represents corporations and other profit-seeking organizations (ex Note.—Historical data—estimated for the period 1970 through June cluding commercial banks but including savings and loan associations, 1977, partly on the basis of the debits series for 233 SMSA’s, which were mutual savings banks, credit unions, the Export-Import Bank, and available through June 1977 are available from Publications Services, Federally sponsored lending agencies). Division of Administrative Services, Board of Governors of the Federal 2 Represents accounts of individuals, partnerships, and corporations, Reserve System, Washington, D.C. 20551. Debits and turnover data for and of States and political subdivisions. savings deposits are not available prior to July 1977. 3 Excludes negotiable orders of withdrawal (NOW) accounts and special club accounts, such as Christmas and vacation clubs. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A14 Domestic Financial Statistics □ April 1978 1.21 MONEY STOCK MEASURES AND COMPONENTS Billions of dollars, averages of daily figures 1977 »- 1978 1974 1975 1976 1977 Dec. Dec. Dec.r Dec.r Item Sept. Oct. Nov. Dec. Jan.r Feb. Seasonally adjusted MEASURES i 1 M-l........................................................... 282.8 294.5 312.6 336.7 331.6 334.6 334.7 336.7 339.4 339.1 2 M-2........................................................... 612.1 664.1 739.6 807.6 793.8 800.2 803.8 807.6 813.6 816.6 3 M-3........................................................... 981.2 1,091.8 1,235.6 1,374.1 1,343.5 1,356.7 1,365.5 1,374.1 1,384.1 1,390.5 4 M-4........................................................... 701.1 745.4 802.3 881.6 857.6 866.5 874.6 881.6 889.9 896.0 5 M-5........................................................... 1,070.2 1,173.2 1,298.3 1,448.1 1,407.4 1,423.0 1,436.4 1,448.1 1,460.4 1,469.8 COMPONENTS 6 Currency.................................................. 67.8 73.7 80.7 88.5 86.3 87.1 87.7 88.5 89.3 90.0 Commercial bank deposits: 7 Demand............................................... 215.1 220.8 231.9 248.2 245.3 247.5 247.0 248.2 250.1 249.1 8 Time and savings................................ 418.3 450.9 489.7 544.9 525.9 531.9 540.0 544.9 550.5 556.9 9 Negotiable CD’s2.......................... 89.0 81.3 62.7 74.0 63.8 66.4 70.9 74.0 76.3 79.4 10 Other................................................ 329.3 369.6 427.0 470.9 462.1 465.5 469.1 470.9 474.2 477.5 11 Nonbank thrift institutions3............... 369.1 427.8 496.0 566.5 549.8 556.5 561.7 566.5 570.5 573.9 Not seasonally adjusted MEASURES i 12 M-l........................................................... 291.2 303.2 321.7 346.4 329.8 334.0 336.8 346.4 345.2 333.3 13 M-2........................................................... 617.5 669.3 744.8 813.0 790.0 797.5 801.2 813.0 818.3 811.5 14 M-3........................................................... 983.8 1,094.3 1,237.5 1,375.5 1,338.4 1,351.7 1,358.5 1,375.5 1,386.5 1,383.4 15 M-4........................................................... 707.9 752.8 809.1 888.9 855.4 865.8 872.8 888.9 894.6 888.3 16 M-5........................................................... 1,074.2 1,177.7 1,301.8 1,451.4 1,403.8 1,420.0 1,430.1 1,451.4 1,462.9 1,460.3 COMPONENTS 17 Currency.................................................. 69.0 75.1 82.1 90.0 86.2 86.9 88.4 90.0 88.6 88.9 Commercial bank deposits: 18 Demand................................................ 222.2 228.1 239.5 256.4 243.6 247.0 248.4 256.4 256.6 244.4 19 Member........................................... 159.7 162.1 168.5 176.3 167.5 170.0 170.3 176.3 175.9 167.4 20 Domestic nonmember.................. 58.5 62.6 67.5 75.8 71.8 72.7 73.8 75.8 76.3 72.8 21 Time and savings................................ 416.7 449.6 487.4 542.5 525.7 531.8 536.0 542.5 549.4 555.0 22 Negotiable CD’s2................... 90.5 83.5 64.3 75.9 65.4 68.3 71.6 75.9 76.4 76.9 23 Other................................................ 326.3 366.2 423.1 466.6 460.2 463.5 464.4 466.6 473.0 478.1 24 Nonbank thrift institutions3............... 366.3 424.9 492.7 562.5 548.4 554.2 557.3 562.5 568.2 571.9 25 U.S. Govt, deposits (all commercial banks).............................................. 4.9 4.1 4.4 5.1 5.0 3.7 3.5 5.1 4.2 4.2 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 at 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: Revision” in the April 1978 Bulletin, pp. process of collection and F.R. float; (2) foreign demand balances at F.R. 338 and 339. 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 deposit (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. there were increases of about $500 million in loans, $100 million in 2 Loans sold are those sold outright to a bank’s own foreign branches, “Other” securities, and $600 million in “Total loans and investments.” nonconsolidated nonbank affiliates of the bank, the bank’s holding As of Oct. 31, 1974, “Total loans and investments” of all commercial company (if not a bank), and nonconsolidated nonbank subsidiaries of banks were reduced by $1.5 billion in connection with the liquidation the holding company. Prior to Aug. 28, 1974, the institutions included of one large bank. Reductions in other items were: “Total loans,” $1.0 had been defined somewhat differently, and the reporting panel of banks billion (of which $0.6 billion was in “Commercial and industrial loans”), was also different. On the new basis, both “Total loans” and “Com and “Other securities,” $0.5 billion. In late November “Commercial and mercial and industrial loans” were reduced by about $100 million. industrial loans” were increased by $0.1 billion as a result of loan re 3 Reclassification of loans reduced these loans by about $1.2 billion classifications at another large bank. as of Mar. 31, 1976. 4 Reclassification of loans at one large bank reduced these loans by Note.—Data are for last Wednesday of month except for June 30 about $300 million as of Dec. 31, 1977. and Dec. 31; data are partly or wholly estimated except when June 30 5 Data beginning June 30, 1974, include one large mutual savings and Dec. 31 are call dates. bank that merged with a nonmember commercial bank. As of that date Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Monetary Aggregates A15 1.22 AGGREGATE RESERVES AND DEPOSITS Member Banks Billions of dollars, averages of daily figures 1977 r 1978 1974 1975 1976 Dec.r Dec.r Dec.r July Aug. Sept. Oct. Nov. Dec. Jan.r Feb. Seasonally adjusted 1 Reserves 1....................................................... 36.56 34.68 34.93 35.30 35.53 35.49 35.83 35.96 36.15 36.83 36.99 2 Nonborrowed............................................ 35.83 34.55 34.88 34.97 34.47 34.87 34.52 35.10 35.58 36.35 36.58 3 Required..................................................... 36.30 34.41 34.66 35.02 35.33 35.29 35.62 35.71 35.96 36.57 36.75 4 Deposits subject to reserve requirements 2 486.1 504.6 528.9 547.2 550.5 553.0 558.5 564.4 569.1 575.7 577.8 5 Time and savings..................................... 322.1 337.1 354.3 368.9 370.8 373.0 377.1 383.5 387.0 390.5 395.4 Demand: 6 Private..................................................... 160.6 164.5 171.4 175.3 176.5 176.7 178.3 178.0 178.5 182.1 179.5 7 U.S. Govt............................................... 3.3 2.9 3.2 3.0 3.2 3.3 3.1 3.0 3.6 3.1 3.0 Not seasonally adjusted 8 Deposits subject to reserve requirements 2 491.8 510.9 534.8 547.6 548.3 552.1 558.2 562.1 575.3 581.3 572.5 9 Time and savings...................................... 321.7 337.2 353.6 369.5 371.7 373.0 377.5 380.7 386.4 390.3 393.2 Demand: 10 Private.................................................... 166.6 170.7 177.9 175.6 174.1 175.2 178.0 178.7 185.1 187.9 176.1 11 U.S. Govt............................................... 3.4 3.1 3.3 2.6 2.5 3.8 2.7 2.6 3.8 3.1 3.1 1 Series reflects actual reserve requirement percentages with no adjust 2 Includes total time and savings deposits and net demand deposits as ment to eliminate the effect of changes in Regulations D and M. There defined by Regulation D. Private demand deposits include all demand are breaks in series because of changes in reserve requirements effective deposits except those due to the U.S. Govt., less cash items in process of Dec. 12,1974; Feb. 13, May 22, and Oct. 30,1975; Jan. 8, and Dec. 30,1976. collection and demand balances due from domestic commercial banks. In addition, effective Jan. 1, 1976, statewide branching in New York was instituted. The subsequent merger of a number of banks raised Note.—Back data and estimates of the impact on required reserves required reserves because of higher reserve requirements on aggregate and changes in reserve requirements are shown in Table 14 of the Board’s deposits at these banks. 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 1977 1978 1973 1974 1975 1976 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Category 5 Oct. 26 Nov. 30 Dec. 31 Jan. 25 Feb. 22 Mar. 29 V p p V p p Seasonally adjusted 1 Loans and investments1............................................. 633.4 690.4 721.1 784.4 857.9 866.1 865.4 874.3 881.9 888.8 2 Including loans sold outright2............................ 637.7 695.2 725.5 788.2 862.0 870.5 870.0 878.8 886.2 892.9 Loans: 3 Total.......................................................................... 449.0 500.2 496.9 538.9 602.5 611.2 612.9 622.4 625.4 633.5 4 Including loans sold outright2........................ 453.3 505.0 501.3 542.7 606.6 615.6 617.5 626.9 629.7 637.6 5 Commercial and industrial.................................. 156.4 183.3 176.0 3179.5 199.3 201.6 4202.2 204.6 207.1 211.0 6 Including loans sold outright2............................ 159.0 186.0 178.5 3181.9 202.2 204.7 4205.5 207.7 210.1 213.9 Investments: 7 U.S. Treasury.......................................................... 54.5 50.4 79.4 97.3 97.8 95.0 93.5 92.5 97.5 96.5 8 Other......................................................................... 129.9 139.8 144.8 148.2 157.6 159.9 159.0 159.4 159.0 158.8 Not seasonally adjusted 9 Loans and investments1............................................. 647.3 705.6 737.0 801.6 856.1 866.4 884.5 872.7 875.0 886.5 10 Including loans sold outright2............................ 651.6 710.4 741.4 805.4 860.2 870.8 889.1 877.2 879.3 890.6 Loans: 11 Total1........................................................................ 458.5 510.7 507.4 550.2 601.3 610.1 625.7 617.0 617.9 629.4 12 Including loans sold outright2........................ 462.8 515.5 511.8 554.0 605.4 614.6 630.4 621.5 622.2 633.5 13 Commercial and industrial................................ 159.4 186.8 179.3 3182.9 198.6 200.8 4206.0 202.5 205.0 210.9 14 Including loans sold outright2....................... 162.0 189.5 181.8 3185.3 201.5 203.9 4209.3 205.6 208.0 213.8 Investments: 15 U.S. Treasury.......................................................... 58.3 54.5 84.1 102.5 97.7 97.9 98.9 97.2 98.9 97.9 16 Other......................................................................... 130.6 140.5 145.5 148.9 157.1 158.4 159.8 158.5 158.1 159.2 For notes see bottom of opposite page. 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A16 Domestic Financial Statistics □ April 1978 1.24 COMMERCIAL BANK ASSETS AND LIABILITIES Last-Wednesday-of-Month Series Billions of dollars except for number of banks 1976 19773 19783 Account Dec. 3 June July? Aug.P Sept.* Oct.p Nov.? Dec.p Jan.P Feb.p Mar.p All commercial 1 Loans and investments........................... 846.4 877.5 875.0 886.8 891.4 897.7 915.0 931.6 919.9 924.4 934.4 2 Loans, gross........................................ 594.9 621.9 620.7 632.2 637.1 642.9 658.7 673.4 664.2 667.4 677.2 Investments: 3 U.S. Treasury securities............... 102.5 101.6 100.0 99.4 98.5 97.7 97.8 98.9 97.2 98.9 97.9 4 Other................................................. 148.9 154.1 154.3 155.2 155.9 157.1 158.4 159.3 158.5 158.1 159.2 5 136.1 139.1 126.9 135.5 128.7 129.4 138.8 150.1 128.0 146.5 131.4 6 Currency and coin............................. 12.1 12.7 13.5 13.7 13.9 13.9 14.7 15.8 14.1 13.9 14.3 7 Reserves with F.R. Banks............... 26.1 25.5 27.2 28.2 30.0 28.3 26.3 32.1 26.6 31.0 30.2 8 Balances with banks.......................... 49.6 47.4 42.4 45.3 42.7 44.4 46.8 48.8 43.3 47.4 43.8 9 Cash items in process of collection.. 48.4 53.4 43.9 48.3 42.1 42.8 51.0 53.5 44.0 54.2 43.1 10 Total assets/total liabilities and 1,030.7 1,074.2 1,059.3 1,079.7 1,076.7 1,083.9 1,117.5 1,145.4 1,112.8 1,136.7 1,134.6 11 838.2 861.9 843.2 857.6 852.1 858.8 883.5 908.5 880.3 895.8 892.4 Demand: 12 45.4 46.5 38.2 39.6 37.1 37.5 41.8 43.7 37.3 42.8 37.6 13 U.S. Govt......................................... 3.0 2.8 3.8 2.5 8.0 3.6 4.7 7.2 4.5 5.8 4.8 14 Other................................................. 288.4 288.1 273.9 285.1 272.5 279.4 293.2 307.0 283.8 287.8 279.4 Time: 15 9.2 8.9 8.3 8.0 8.3 8.5 9.0 9.6 9.2 8.8 9.1 16 Other................................................. 492.2 515.6 519.0 522.6 526.1 529.9 534.8 541.1 545.5 550.7 561.5 17 Borrowings............................................... 80.2 88.2 92.2 94.8 96.5 96.8 101.0 107.1 101.7 105.7 107.3 18 78.1 81.8 79.0 79.6 80.1 80.5 81.4 81.6 82.2 82.6 83.2 19 14,671 14,718 14,709 14,713 14,724 14,718 14,718 14,703 14,702 14,683 14,683 Member 20 620.5 632.8 628.9 637.9 640.8 645.2 658.6 670.8 659.5 661.8 668.6 21 Loans, gross........................................ 442.9 453.4 451.3 459.9 463.0 467.1 479.0 489.9 481.8 483.1 490.5 Investments: 22 U.S. Treasury securities............... 74.6 72.6 70.8 70.5 69.6 68.9 69.2 69.9 67.7 69.2 68.2 23 103.1 106.7 106.8 107.5 108.3 109.3 110.3 111.1 110.0 109.5 109.9 24 Cash assets, total.................................... 108.9 110.6 101.2 108.6 103.1 102.3 110.6 121.7 102.2 117.2 104.8 25 Currency and coin............................. 9.1 9.3 9.9 10.0 10.2 10.2 10.8 11.7 10.4 10.2 10.6 26 Reserves with F.R. Banks............... 26.0 25.6 27.2 28.2 30.0 28.3 26.3 32.1 26.6 31.0 30.2 27 Balances with banks.......................... 27.4 24.4 22.0 24.0 22.5 22.8 24.7 26.6 23.0 24.6 22.9 28 Cash items in process of collection.. 46.5 51.3 42.1 46.4 40.4 41.0 48.9 51.3 42.2 51.4 41.2 29 Total assets/total liabilities and capital i................................................. 772.9 795.2 780.1 796.3 793.2 796.5 823.9 847.0 818.0 835.7 833.2 30 618.7 628.7 611.0 622.2 617.0 620.9 641.8 660.8 636.8 649.2 645.1 Demand: 31 42.4 43.4 35.3 36.6 34.3 34.6 38.7 40.4 34.4 39.5 34.7 32 U.S. Govt......................................... 2.1 2.0 2.8 1.7 6.4 2.6 3.6 5.3 3.4 4.4 3.7 33 215.5 213.9 202.2 211.0 200.3 205.3 216.4 226.3 208.4 211.8 205.1 Time: 34 7.2 6.9 6.3 6.0 6.3 6.5 6.8 7.4 7.1 6.7 7.0 35 Other................................................. 351.5 362.5 364.4 366.9 369.6 372.0 376.2 381.4 383.5 386.9 394.7 36 71.7 77.0 80.4 82.5 84.0 83.8 87.8 93.4 88.0 90.8 91.8 37 Total capital accounts2......................... 58.6 60.8 59.4 59.9 60.2 60.6 61.2 61.4 61.7 62.1 62.4 38 Memo: Number of banks................... 5,759 5,721 5,701 5,676 5,692 5,686 5,686 5,668 5,656 5,656 5,656 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
Commercial Banks A17 1.25 COMMERCIAL BANK ASSETS AND LIABILITIES Call-Date Series Millions of dollars except for number of banks 1975 1976 1977 1975 1976 1977 Account Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Total insured National (all insured) 1 762,400 773,701 827,692 854,736 441,135 443,959 476,602 488,240 Loans: 2 Gross............................................................... 535,170 539,021 578,710 601,141 315,738 315,628 340,679 351,311 3 Net................................................................... (2) 520,976 560,062 581,163 (2) 305,280 329,968 339,955 Investments: 4 U.S. Treasury securities................................. 83,629 90,947 101,463 100,566 46,799 49,688 55,729 53,346 5 Other............................................................... 143,602 143,731 147,517 153,029 78,598 78,642 80,193 83,582 6 Cash assets.............................................................. 128,256 124,072 129,581 130,724 78,026 75,488 76,074 74,641 7 Total assets/total liabilities1.................................. 944,654 942,519 1,004,001 1,040,952 553,285 548,702 583,315 599,743 8 Deposits.................................................................. 775,209 776,957 825,010 847,373 447,590 444,251 469,378 476,381 Demand: 9 U.S. Govt....................................................... 3,108 4,622 3,020 2,817 1,788 2,858 1,674 1,632 10 Interbank........................................................ 40,259 37,502 44,068 44.965 22,305 20,329 23,148 22,876 11 Other............................................................... 276,384 265,671 285,201 284,544 159,840 152,383 163,347 161,358 Time: 12 Interbank........................................................ 10,733 9,406 8,249 7,721 7,302 5,532 4,909 4,599 13 Other............................................................... 444,725 459,753 484,470 507,323 256,355 263,147 276,298 285,915 14 Borrowings............................................................. 56,775 63,828 75,302 81,157 40,875 45,187 54,420 57,283 15 Total capital accounts... *.................................... 68,474 68,988 72,065 75,503 38,969 39,501 41,323 43,142 16 Memo: Number of banks..................................... 14,372 14,373 14,397 14,425 4,741 4,747 4,735 4,701 State member (all insured) Insured nonmember 17 Loans and investments, gross................................. 137,620 136,915 144,000 144,597 183,645 192,825 207,089 221,898 Loans: 18 Gross............................................................... 100,823 98,889 102,277 102,144 118,609 124,503 135,753 147,685 19 Net................................................................... (2) 96,037 99,474 99,200 (2) 119,658 130,618 142,008 Investments: 20 U.S. Treasury securities................................. 14,720 16,323 18,849 19,296 22,109 24,934 26,884 27,923 21 Other................................................................ 22,077 21,702 22,873 23,157 42,927 43,387 44,450 46,288 22 Cash assets.............................................................. 30,451 30,422 32,859 35,918 19,778 18,161 20,647 20,164 23 Total assets/total liabilities..................................... 180,495 179,649 189,578 195,455 210,874 214,167 231,106 245,753 24 Deposits.................................................................. 143,409 142,061 149,491 152,471 184,210 190,644 206,140 218,519 Demand: 25 U.S. Govt.................................................... 467 869 429 371 853 894 917 813 26 Interbank......................................................... 16,265 15,833 19,295 20,568 1,689 1,339 1,624 1,520 27 Other................................................................ 50,984 49,659 52,204 52,571 65,560 63,629 69,649 70,615 Time: 28 Interbank........................................................ 2,712 3,074 2,384 2,134 719 799 956 988 29 Other................................................................ 72,981 72,624 75,178 76,826 115,389 123,980 132,993 144,581 30 Borrowings.............................................................. 12,771 15,300 17,310 19,718 3,128 3,339 3,571 4,155 31 Total capital accounts............................................. 13,105 12,791 13,199 13,441 16,400 16,696 17,543 18,919 32 Memo: Number of banks..................................... 1,046 1,029 1,023 1,019 8,585 8,597 8,639 8,705 Noninsured nonmember Total nonmember 33 Loans and investments, gross................................. 13,674 15,905 18,819 22,940 197,319 208,730 225,909 244,839 Loans: 34 Gross................................................................ 11,283 13,209 16,336 20,865 129,892 137,712 152,090 168,551 35 Net................................................................... (2) 13,092 16,209 20,679 (2) 132,751 146,828 162,687 Investments: 36 U.S. Treasury securities................................. 490 472 1,054 993 22,599 25,407 27,939 28,917 37 Other................................................................ 1,9Q2 2,223 1,428 1,081 44,829 45,610 45,879 47,370 38 Cash assets.............................................................. 5,359 4,362 6,496 8,330 25,137 22,524 27,144 28,494 39 Total assets/total liabilities..................................... 20,544 21,271 26,790 33,390 231,418 235,439 257,897 279,143 40 Deposits................................................................... 11,323 11,735 13,325 14,658 195,533 202,380 219,466 233,177 Demand: 41 U.S. Govt........................................................ 6 4 4 8 859 899 921 822 42 Interbank........................................................ 1,552 1,006 1,277 1,504 3,241 2,346 2,901 3,025 43 Other................................................................ 2,308 2,555 3,236 3,588 67,868 66,184 72,885 74,203 Time: 44 Interbank........................................................ 1,291 1,292 1,041 1,164 2,010 2,092 1,997 2,152 45 Other................................................................ 6,167 6,876 7,766 8,392 121,556 130,857 140,760 152,974 46 Borrowings.............................................................. 3,449 3,372 4,842 7,056 6,577 6,711 8,413 11,212 47 Total capital accounts............................................. 651 663 818 893 17,051 17,359 18,361 19,813 48 Memo: Number of banks..................................... 261 270 275 293 8,846 8,867 8,914 8,998 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 □ April 1978 1.26 COMMERCIAL BANK ASSETS AND LIABILITIES Detailed Balance Sheet, September 30, 1977 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 1 140,401 119,931 37,228 4,748 43,071 34,883 20,477 2 11,322 8,309 786 166 2,741 4,618 3,012 25,582 25,582 2,658 1,592 11,035 10,297 4 Demand balances with banks in United States..................... 34,233 21,301 9,956 242 2,979 8,124 12,939 5 Other balances with banks in United States......................... 4,544 2,559 50 8 948 1,552 1,986 6 Balances with banks in foreign countries.............................. 3,570 3,206 346 174 1,785 900 365 7 Cash items in process of collection........................................ 61,150 58,974 23,433 2,565 23,583 9,392 2,176 8 Total securities held—Book value.............................................. 253,100 178,314 22,398 8,518 57,243 90,155 74,798 9 U.S. Treasury.......................................................................... 98,633 70,747 11,319 3,700 23,234 32,494 27,897 10 Other U.S. Govt, agencies...................................................... 35,232 21,954 1,435 629 5,911 13,979 13,278 11 States and political subdivisions............................................ 113,002 81,356 9,276 3,953 26,854 41,273 31,646 12 All other securities.................................................................. 6,142 4,198 368 236 1,224 2,370 1,944 n 91 58 19 39 33 14 Trading-account securities............................................................. 6,524 6,399 2,912 762 2,465 260 125 15 U.S. Treasury....................................................................... 3,824 3,815 2,019 458 1,232 105 9 16 Other U.S. Govt, agencies.................................................. 629 612 228 125 224 35 18 17 States and political subdivisions......................................... 1,471 1,438 536 97 726 79 32 18 All other trading acct. securities........................................ 510 477 129 82 264 2 33 19 91 58 19 39 33 20 Bank investment portfolios........................................................... 246,575 171,914 19,486 7,756 54,777 89,895 74,673 21 94,810 66,932 9,300 3,242 22,002 32,389 27,887 22 Other U.S. Govt, agencies.................................................. 34,603 21,343 1,207 504 5,687 13,945 13,261 23 111,531 79,918 8,740 3,856 26,128 41,194 31,614 24 5,632 3,721 239 154 960 2,368 1,911 25 F.R. stock and corporate stock................................................. 1,590 1,342 296 105 489 452 248 26 Federal funds sold and securities resale agreement..................... 42,200 33,672 3,450 1,366 17,721 11,135 8,623 27 Commercial banks................................................................... 34,701 26,484 1,461 1,180 13,524 10,319 8,311 28 Brokers and dealers................................................................. 5,104 4,960 1,337 143 2,828 652 144 29 Others...................................................................................... 2,396 2,228 652 43 1,369 163 168 30 Other loans, gross....................................................................... 581,099 435,012 72,932 22,648 161,728 177,704 146,088 31 Less: Unearned income on loans.......................................... 14,273 9,632 600 85 3,116 5,831 4,641 32 Reserves for loan loss.................................................. 6,549 5,216 1,225 326 1,923 1,742 1,333 33 560,277 420,164 71,107 22,237 156,689 170,130 140,113 Other loans, gross, by category 34 Real estate loans............................................................................ 169,334 117,012 9,227 2,172 42,901 62,713 52,322 35 19,606 14,940 2,327 429 7,169 5,014 4,666 36 Secured by farmland........................................................... 7,607 3,259 20 12 335 2,893 4,348 37 Secured by residential......................................................... 96,512 67,990 4,516 1,146 25,297 37,030 28,522 38 1- to 4-family residences....................................................... 91,776 64,582 4,038 1,041 24,008 35,496 27,194 39 FHA-insured or VA-guaranteed................................. 7,723 6,708 568 60 3,518 2,562 1,016 40 84,053 57,874 3,470 981 20,490 32,934 26,179 41 4,736 3,408 479 105 1,289 1,535 1,328 42 367 306 106 22 107 71 61 43 Conventional................................................................ 4,369 3,102 373 83 1,183 1,463 1,267 44 Secured by other properties................................................ 45,609 30,824 2,364 585 10,099 17,776 14,786 45 Loans to financial institutions....................................................... 33,962 32,105 11,365 4,050 13,800 2,890 1,858 46 To REIT’s and mortgage companies................................. 9,039 8,690 2,813 1,009 4,180 688 350 47 2,581 2,074 679 113 1,029 253 507 48 To banks in foreign countries............................................ 6,621 6,446 3,008 286 2,624 528 175 49 1,250 1,100 98 47 718 237 150 50 14,472 13,795 4,768 2,595 5,249 1,183 677 51 11,478 11,239 6,508 1,693 2,808 231 239 52 4,257 3,542 418 342 1,819 964 715 53 Loans to farmers—except real estate..................................... 26,271 14,434 154 127 3,392 10,760 11,836 54 186,730 151,470 36,443 11,083 58,955 44,989 35,260 55 134,381 92,783 6,237 1,966 32,768 51,813 41,597 56 Instalment loans.......................................................................... 107,454 74,070 4,616 1,210 26,608 41,636 33,384 57 47,716 30,562 887 149 8,950 20,576 17,154 58 Residential-repair/modernize.......................................... 7,071 4,711 297 61 1,682 2,671 2,359 59 Credit cards and related plans........................................ 16,348 14,377 1,929 815 7,932 3,701 1,971 60 Charge-account credit cards....................................... 12,697 11,334 1,281 776 6,403 2,874 1,363 61 Check and revolving credit plans............................... 3,651 3,043 648 39 1,529 826 608 62 Other retail consumer goods........................................... 17,214 11,737 365 60 4,263 7,049 5,477 63 9,051 6,365 183 24 2,283 3,875 2,686 64 Other............................................................................. 8,163 5,372 182 36 1,980 3,175 2,791 65 19,105 12,682 1,138 125 3,780 7,639 6,423 66 Single-payment loans to individuals................................... 26,927 18,714 1,621 757 6,160 10,177 8,213 67 All other loans......................................................................... 14,687 12,426 2,581 1,214 5,286 3,345 2,261 68 Total loans and securities, net.................................................... 857,167 633,492 97,251 32,226 232,142 271,872 223,782 69 Direct lease financing.................................................................. 5,433 5,094 964 136 3,125 871 339 70 Fixed assets—Buildings, furniture, real estate.......................... 20,681 15,388 2,191 721 5,882 6,593 5,296 71 Investment in unconsolidated subsidiaries................................ 2,816 2,775 1,290 234 1,161 90 41 72 Customer acceptances outstanding............................................ 11,822 11,357 5,459 794 4,800 303 465 73 Other assets................................................................................. 28,438 24,850 8,359 1,246 10,811 4,434 3,653 74 Total assets................................................................................... 1,066,758 | 812,886 152,743 40,105 300,993 319,045 254,052 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Commercial Banks A19 1.26 Continued M[ember banks1 Insured Non- Liability or capital account commercial Large banks member banks banks1 Total All other New York City of Other City Chicago large 334,879 260,255 60,788 10,020 93,342 96,105 74,633 76 1,355 1,180 596 1 258 325 175 77 Other individuals, partnerships, and corporations............... 255,804 191,532 31,048 7,343 72,990 80,151 64,273 78 U.S. Govt....................................................................................... 5,279 4,095 356 138 1,815 1,787 1,184 79 States and political subdivisions............................................... 16,719 11,572 773 264 3,498 7,037 5,147 80 Foreign governments, central banks, etc................................ 1,478 1,444 1,192 16 214 22 34 81 Commercial banks in United States........................................ 34,016 32,875 16,823 1,718 10,513 3,819 1,151 82 Banks in foreign countries......................................................... 6,713 6,571 5,203 199 1,013 157 142 83 Certified and officers’ checks, etc............................................. 13,516 10,987 4,797 341 3,042 2,807 2,529 84 Time deposits.................................................................................... 309,412 223,635 32,640 13,458 77,932 99,605 85,777 85 Accumulated for personal loan payments.............................. 122 98 11 87 24 86 Mutual savings banks................................................................. 307 295 122 69 88 17 12 87 Other individuals, partnerships, and corporations............... 245,125 176,081 24,649 10,037 60,163 81,233 69,043 88 U.S. Govt....................................................................................... 811 660 50 46 356 208 151 89 States and political subdivisions.............................................. 48,847 33,495 1,517 1,309 13,623 17,046 15,352 90 Foreign governments, central banks, etc................................ 7,189 6,883 3,999 1,308 1,522 54 306 91 5,428 4,700 1,517 607 1,896 681 728 92 Banks in foreign countries......................................................... 1,583 1,422 787 82 274 280 161 93 Savings deposits................................................................................ 217,555 152,871 11,515 3,027 55,808 82,521 64,684 94 Individuals and nonprofit organizations................................ 201,982 141,902 10,541 2,828 51,981 76,553 60,081 95 Corporations and other profit organizations......................... 10,618 7,618 596 179 3,182 3,661 3,000 96 57 49 4 16 29 8 97 States and political subdivisions.............................................. 4,859 3,267 355 20 617 2,274 1,593 Qft All nther........................................................................................ 38 35 20 11 5 3 861,847 636,761 104,944 26,506 227,081 278,231 225,095 100 Federal funds purchased and securities sold under agreements to repurchase............................................................................ 80,475 76,053 19,246 8,847 37,148 10,811 4,422 101 Commercial banks....................................................................... 40,568 38,676 7,239 5,918 21,034 4,485 1,892 102 Brokers and dealers..................................................................... 10,327 9,920 1,872 1,551 5,197 1,299 408 103 Others............................................................................................ 29,580 27,457 10,135 1,378 10,917 5,027 2,123 6,941 6,594 2,305 134 3,299 855 347 105 Mortgage indebtedness................................................................... 822 587 75 16 293 202 236 106 Bank acceptances outstanding...................................................... 12,448 11,983 6,063 802 4,813 305 465 107 Other liabilities................................................................................. 21,082 18,543 6,979 980 6,972 3,612 2,701 108 Total liabilities.................................................................................. 983,615 750,520 139,612 37,285 279,697 294,016 233,266 109 Subordinated notes and debentures............................................ 5,452 4,296 1,116 81 1,920 1,179 1,156 110 Equity capital.................................................................................... 77,691 58,070 12,014 2,740 19,466 23,850 19,630 Ill Preferred stock............................................................................. 76 31 2 29 45 112 16,800 12,196 2,534 570 3,869 5,223 4,608 113 30.310 22,243 4,550 1,325 7,901 8,467 8,070 114 Undivided profits......................................................................... 28,784 22,414 4,891 791 7,289 9,442 6,373 115 Other capital reserves................................................................. 1,721 1,187 39 53 405 690 534 116 Total liabilities and equity capital................................................ 1,066,758 812,866 152,743 40,105 300,993 319,045 254,052 Memo items : 234,434 164,312 20,176 5,599 57,431 81,106 70,123 Average for last 15 or 30 days: 118 Cash and due from bank........................................................... 130,354 111,396 32,164 4,734 41,131 33,367 18,964 119 Federal funds sold and securities purchased under agree ments to resell..................................................................... 45,457 35,524 4,308 1,467 17,459 12,290 9,997 120 Total loans.................................................................................... 562,308 421,470 71,435 22,100 157,150 170,785 140,838 121 137,978 112,438 26,334 10,410 46,080 29,613 25,540 122 845,729 622,100 96,770 25,565 233,052 276,712 223,636 123 Federal funds purchased and securities sold under agree ments to repurchase........................................................... 85,514 81,480 23,101 10,134 37,645 10,600 4,034 124 Other liabilities for borrowed money...................................... 6,792 6,436 2,125 110 3,470 732 356 125 Standby letters of credit outstanding.......................................... 13,068 12,223 6,744 1,036 3,515 928 845 126 Time deposits of $100,000 or more............................................. 141,125 114,857 26,424 10,626 47,351 30,276 26,268 127 Certificates of deposit................................................................. 118,970 96,381 22,542 9,270 38,845 25,724 22,589 128 Other time deposits..................................................................... 22,155 18,477 3,882 1,356 8,686 4,553 3,679 129 Number of banks............................................................................ 14,420 5,691 12 9 154 5,516 8,739 1 Member banks exclude and nonmember banks include 10 noninsured Note.—Data include consolidated reports, including figures for all trust companies that are members of the Federal Reserve System, and bank-premises subsidiaries and other significant majority-owned do member banks exclude 2 national banks outside the continental United mestic subsidiaries. Securities are reported on a gross basis before deduc States. tions of valuation reserves. Holdings by type of security will be reported 2 Demand deposits, adjusted are demand deposits other than domestic as soon as they become available. commercial interbank and U.S. Govt., less cash items reported as in Back data in lesser detail were shown in previous Bulletins. Details process of collection. may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A20 Domestic Financial Statistics □ April 1978 1.27 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS Assets and Liabilities Millions of dollars, Wednesday figures 1978 Account Feb. 1 Feb. 8 Feb.15 Feb. 22 Mar. Mar. 8p Mar. 15^ Mar. 22* Mar. 29? 1 Total loans and investments..................................... 444,890 448,928 445,160 442,355 445,432 449,801 452,846 448,017 447,645 Loans: 2 Federal funds sold1................................................ 26,535 27,886 24,933 23,237 23,635 25,878 26,925 24,929 25,271 3 To commercial banks...................................... 19,919 21,462 19,689 18,745 18,877 19,430 20,105 19,882 20,214 To brokers and dealers involving— 4 U.S. Treasury securities.............................. 3,509 3,244 2,507 2,134 2,261 3,511 3,790 2,426 2,274 5 Other securities.............................................. 594 567 513 467 460 601 582 532 507 6 To others............................................................. 2,513 2,613 2,224 1,891 2,037 2,336 2,448 2,089 2,276 7 Other, gross............................................................. 317,748 320,299 318,754 318,039 320,578 320,891 322,828 321,675 322,096 8 Commercial and industrial............................. 124,501 124,621 125,270 125,609 126,773 127,137 128,042 128,362 128,805 9 Agricultural........................................................ 4,567 4,543 4,548 4,533 4,557 4,595 4,649 4,677 4,711 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities.......................... 1,526 2,644 1,195 971 1,189 2,125 1,790 1,102 818 11 Other securities......................................... 8,757 8,909 8,754 8,517 8,757 8,685 9,557 8,716 8,044 To others: 12 U.S. Treasury securities.......................... 101 101 100 105 106 104 100 99 100 13 Other securities.......................................... 2,630 2,657 2,656 2,636 2,612 2,579 2,584 2,544 2,559 To nonbank financial institutions: 14 Personal and sales finance cos., etc.......... 7,356 7,436 7,461 7,311 7,317 7,393 7,519 7,510 7,485 15 Other............................................................... 15,249 15,243 15,227 15,058 15,094 15,097 15,046 15,010 15,104 16 Real estate.......................................................... 75,216 75,363 75,529 75,694 75,879 76,061 76,391 76,585 76,788 To commercial banks: 17 Domestic........................................................ 2,228 2,383 2,038 1,962 2,278 2,030 1,880 2,002 1,990 18 Foreign........................................................... 6,146 6,904 6,291 6,339 6,428 6,064 5,984 5,880 6,238 19 Consumer instalment........................................ 46,867 46,738 46,696 46,714 46,784 46,770 46,878 46,986 47,234 20 Foreign govts., official institutions, etc........ 1,713 1,716 1,694 1,663 1,652 1,739 1,627 1,681 1,736 21 All other loans................................................... 20,891 21,041 21,295 20,927 21,152 20,512 20,781 20,521 20,484 22 Less : Loan loss reserve and unearned income on loans............................................... 9,444 9,479 9,510 9,551 9,544 9,628 9,665 9,694 9,629 23 Other loans, net...................................................... 308,304 310,820 309,244 308,488 311,034 311,263 313,163 311,981 312,467 Investments: 24 U.S. Treasury securities........................................ 44,564 44,335 45,405 44,944 44,969 46,786 46,297 44,754 44,038 25 Bills...................................................................... 7,013 7,141 7,435 7,064 6,589 7,750 7,454 6,706 6,328 Notes and bonds, by maturity: 26 Within 1 year................................................. 8,860 8,979 8,698 8,487 8,779 8,774 8,745 8,426 8,393 27 1 to 5 years..................................................... 24,521 24,196 24,603 24,684 25,081 25,804 25,889 25,509 25,221 28 After 5 years................................................... 4,170 4,019 4,669 4,709 4,520 4,458 4,209 4,113 4,096 29 Other securities....................................................... 65,487 65,887 65,578 65,686 65,794 65,874 66,461 66,353 65,869 Obligations of States and political subdivisions: 30 Tax warrants, short-term notes, and bills........................................................... 7,110 7,548 7,070 7,046 6,886 6,906 7,270 7,060 6,532 31 All other.......................................................... 43,032 43,139 43,362 43,286 43,169 43,271 43,541 43,444 43,469 Other bonds, corporate stocks, and securities: 32 Certificates of participation2...................... 2,729 2,708 2,678 2,686 2,741 2,739 2,741 2,751 2,786 33 All other, including corporate stocks.... 12,616 12,492 12,468 12,668 12,998 12,958 12,909 13,098 13,082 34 Cash items in process of collection....................... 43,456 36,090 43,688 46,640 47,423 37,616 45,353 39,643 37,316 35 Reserves with F.R. Banks....................................... 21,098 21,688 23,182 23,944 21,595 18,953 20,018 19,814 23,192 36 Currency and coin..................................................... 6,050 5,784 6,180 6,347 6,057 5,783 6,018 6,149 6,572 37 Balances with domestic banks................................ 14,137 13,512 14,171 14,548 14,967 13,484 13,878 14,247 13,399 38 Investments in subsidiaries not consolidated.... 3,042 3,171 3,059 3,128 3,072 3,118 3,110 3,056 3,069 39 Other assets................................................................. 62,663 61,637 60,216 60,609 63,630 63,299 62,952 64,417 64,553 40 Total assets/total liabilities...................................... 595,336 590,810 595,656 597,571 602,176 592,054 604,175 595,343 595,746 Deposits: 41 Demand deposits..................................................... 188,191 180,544 187,057 187,327 191,532 175,897 191,386 178,321 177,269 42 Individuals, partnerships, and corps............. 134,135 130,669 133,696 132,827 136,346 128,210 135,366 128,802 128,408 43 States and political subdivisions..................... 7,107 5,943 6,961 5,991 6,360 5,437 5,944 6,018 5,665 44 U.S. Govt............................................................ 2,105 1,200 1,988 3,056 2,745 1,052 5,730 1,829 2,702 Domestic interbank: 45 Commercial.................................................... 27,985 25,968 28,406 28,423 29,172 26,028 28,036 25,858 24,482 46 Mutual savings.............................................. 927 942 958 879 885 845 908 737 757 Foreign: 47 Governments, official institutions, etc.... 1,283 1,309 1,440 1,422 1,238 1,227 1,149 1,167 1,359 48 Commerial banks.......................................... 6,748 8,005 6,711 7,572 7,139 6,720 6,655 7,459 7,130 49 Certified and officers’ checks.......................... 7,901 6,508 6,897 7,157 7,647 6,378 7,598 6,451 6,766 50 Time and savings deposits 3.................................. 252,357 253,053 252,874 253,808 254,902 257,096 257,648 259,176 260,621 51 Savings4............................................................... 92,529 92,767 92,736 92,776 92,642 93,089 93,265 93,524 94,014 52 Time: 159,828 160,286 160,138 161,032 162,260 164,007 164,383 165,652 166,607 53 Individuals, partnerships, and corps......... 120,877 121,120 121,055 121,614 122,255 123,820 124,362 125,654 126,549 54 States and political subdivisions................ 23,979 24,255 24,164 24,571 24,891 24,968 24,827 24,954 24,916 55 Domestic interbank...................................... 5,149 5,146 5,037 5,073 5,233 5,464 5,495 5,435 5,524 56 Foreign govts., official institutions, etc... 8,318 8,292 8,390 8,356 8,461 8,272 8,241 8,162 8,160 77,435 79,568 78,248 78,978 76,734 79,137 76,753 78,878 78,930 Borrowings from: 58 F.R. Banks............................................................. 592 133 442 99 574 651 232 165 119 59 Others...................................................................... 5,072 5,140 4,992 5,056 5,022 5,476 5,123 5,189 5,496 60 Other liabilities, etc. <>............................................... 26,530 27,171 26,895 27,106 28,092 28,406 27,795 28,309 27,943 61 Total equity capital and subordinated notes/debentures7.............................................. 45,159 45,201 45,148 45,197 45,320 45,391 45,238 45,305 45,368 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
Weekly Reporting Banks A21 1.28 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1978 Account Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. lp Mar. 8p Mar. 15P Mar. 22 p Mar. 29» 1 Total loans and investments..................................... 92,830 96,597 93,020 91,938 92,146 92,153 93,766 91,505 90,049 Loans: 2 Federal funds sold1................................................ 5,367 6,807 4,442 4,166 3,870 3,839 4,552 5,042 4,704 3 To commercial banks...................................... 3,829 5,346 2,970 2,981 2,383 2,141 2,653 3,456 3,178 To brokers and dealers involving— 4 U.S. treasury securities................................ 846 783 691 596 766 898 1,242 892 793 5 2 2 6 To others............................................................. 692 673 781 589 721 800 657 692 731 7 Other gross............................................................. 68,439 71,057 69,236 68,723 69,562 69,319 70,144 68,435 68,083 8 Commercial and industrial.............................. 33,817 33,750 33,789 34,004 34,297 34,194 34,602 34,377 34,628 9 Agricultural........................................................ 167 159 159 162 161 165 167 171 166 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities.......................... 1,355 2,355 1,052 833 1,052 1,864 1,653 962 679 11 Other securities.......................................... 4,523 4,628 4,724 4,479 4,733 4,615 5,212 4,550 4,083 To others: 12 U.S. Treasury securities.......................... 20 20 21 26 26 26 25 25 25 13 Other securities.......................................... 360 366 372 359 351 345 342 339 339 To nonbank financial institutions: 14 Personal and sales finance cos., etc........... 2,336 2,423 2,473 2,394 2,416 2,405 2,477 2,435 2,382 15 Other............................................................... 4,934 5,020 5,051 5,035 4,921 4,972 4,925 4,899 4,874 16 Real estate.......................................................... 9,020 9,019 9,035 9,046 9,049 9,065 9,035 9,033 8,986 To commercial banks: 17 Domestic......................................................... 617 905 607 584 832 590 555 610 523 18 Foreign............................................................ 2,607 3,336 2,861 2,981 2,911 2,720 2,663 2,630 2,922 19 Consumer instalment........................................ 4,403 4,349 4,336 4,330 4,319 4,328 4,329 4,333 4,336 20 Foreign govts, official institutions, etc.......... 281 262 264 231 234 265 236 258 244 21 All other loans................................................... 3,999 4,465 4,492 4,259 4,260 3,765 3,923 3,813 3,896 22 Less: Loan loss reserve and unearned income on loans.................................................... 1,675 1,670 1,674 1,694 1,709 1,720 1,718 1,718 1,677 23 Other loans, net..................................................... 66,764 69,387 67,562 67,029 67,853 67,599 68,426 66,717 66,406 Investments: 24 U.S. Treasury securities........................................ 10,712 10,361 11,056 10,622 10,365 10,669 10,547 9,591 9,162 25 Bills...................................................................... 1,990 1,910 2,093 1,824 1,413 1,597 1,598 1,218 1,071 Notes and bonds, by maturity: 26 Within 1 year................................................. 1,769 1,797 1,766 1,594 1,593 1,590 1,560 1,292 1,251 27 1 to 5 years..................................................... 5,993 5,793 5,875 5,970 6,329 6,437 6,406 6,192 6,051 28 After 5 years................................................... 960 861 1,322 1,234 1,030 1,045 983 889 789 29 Other securities....................................................... 9,987 10,042 9,960 10,121 10,058 10,046 10,241 10,155 9,777 Obligations of States and political subdivisions: 30 Tax warrants, short-term notes, and bills. 1,417 1,433 1,361 1,354 1,154 1,118 1,157 1,137 744 31 Allother......................................................... 6,723 6,736 6,766 6,761 6,809 6,831 6,961 6,884 6,930 Other bonds, corporate stocks, and securities: 32 Certificates of participation2...................... 423 425 410 404 402 402 402 414 425 33 All other, including corporate stocks.... 1,424 1,448 1,423 1,602 1,693 1,695 1,721 1,720 1,678 34 Cash items in process of collection....................... 14,559 10,462 14,819 14,686 15,674 12,191 15,149 13,206 12,688 35 Reserves with F.R. Banks....................................... 5,548 5,781 7,067 6,515 5,829 3,955 5,520 3,838 5,361 36 Currency and coin..................................................... 932 887 952 973 918 913 916 969 1,025 37 Balances with domestic banks................................ 6,459 5,582 6,634 6,481 7,242 6,281 6,706 7,379 6,197 38 Investments in subsidiaries not consolidated.... 1,515 1,518 1,515 1,535 1,549 1,557 1,556 1,561 1,571 39 Other assets................................................................. 24,520 24,116 22,994 23,746 26,243 25,635 24,550 26,541 25,964 40 Total assets/total liabilities...................................... 146,363 144,943 147,001 145,874 149,601 142,685 148,163 144,999 142,855 Deposits: 41 Demand deposits..................................................... 54,430 51,114 53,174 53,113 56,549 47,583 54,834 51,121 49,459 42 Individuals, partnerships, and corps............. 28,971 27,641 28,557 27,681 30,526 25,877 28,801 27,219 26,790 43 States and political subdivisions................... 904 509 690 522 737 445 649 623 563 44 U.S. Govt............................................................ 258 117 357 568 368 91 1,237 203 437 Domestic interbank: 45 Commercial.................................................... 13,927 12,096 13,585 13,033 14,386 11,967 13,871 12,980 11,280 46 Mutual savings.............................................. 507 492 535 453 453 All 489 351 399 Foreign: 47 Governments, official institutions, etc___ 1,024 1,058 1,198 1,183 1,012 972 936 937 1,140 48 Commercial banks........................................ 5,247 6,447 5,295 6,143 5,638 5,142 5,107 5,947 5,625 49 Certified and officers’ checks.......................... 3,592 2,754 2,957 3,530 3,429 2,662 3,744 2,861 3,225 50 Time and savings deposits 3.................................. 45,508 45,134 45,021 45,300 45,400 45,309 44,955 45,013 45,478 51 Savings4.............................................................. 9,965 9,996 9,990 9,989 9,910 9,926 9,917 9,908 9,973 52 Time..................................................................... 35,543 35,138 35,031 35,311 35,490 35,383 35,038 35,105 35,505 53 Individuals, partnerships and corps.......... 26,413 26,036 25,911 26,291 26,336 26,470 26,195 26,351 26,747 54 States and political subdivisions............... 1,598 1,595 1,599 1,634 1,700 1,685 1,701 1,673 1,679 55 Domestic interbank...................................... 1,745 1,719 1,669 1,631 1,600 1,557 1,532 1,492 1,533 56 Foreign govts., official institutions, etc... 5,013 5,017 5,076 5,047 5,135 4,963 4,910 4,896 4,855 57 Federal funds purchased, etc. 5............................. 19,343 21,214 21,591 20,159 20,042 21,812 21,260 21,613 20,497 Borrowings from: 58 F.R. Banks............................................................. 100 250 80 540 35 59 Others...................................................................... 2,332 2,410 2,257 2,227 2,213 2,401 2,244 2,242 2,505 60 Other liabilities, etc. 6................................................ 11,804 12,008 11,719 12,074 12,278 12,010 11,791 11,969 11,887 61 Total equity capital and subordinated notes/ debentures7......................................................... 12,946 12,963 12,989 13,001 13,039 13,030 13,044 13,041 13,029 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 □ April 1978 1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS OUTSIDE NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1978 Account Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. lp Mar. 8p Mar. 15* Mar. 22p Mar. 29*> 1 Total loans and investments..................................... 352,060 352,331 352,140 350,417 353,286 357,648 359,080 356,512 357,596 Loans: 2 Federal funds sold1................................................ 21,168 21,079 20,491 19,071 19,765 22,039 22,373 19,887 20,567 3 To commercial banks...................................... 16,090 16,116 16,719 15,764 16,494 17,289 17,452 16,426 17,036 To brokers and dealers involving— 4 U.S. treasury securities................................ 2,663 2,461 1,816 1,538 1,495 2,613 2,548 1,534 1,481 5 Other securities.............................................. 594 562 513 467 460 601 582 530 505 6 To others............................................................. 1,821 1,940 1,443 1,302 1,316 1,536 1,791 1,397 1,545 7 Other, gross............................................................. 249,309 249,242 249,518 249,316 251,016 251,572 252,684 253,240 254,013 8 Commercial and industrial.............................. 90,684 90,871 91,481 91,605 92,476 92,943 93,440 93,985 94,177 9 Agricultural........................................................ 4,400 4,384 4,389 4,371 4,396 4,430 4,482 4,506 4,545 For purchasing or carrying securities: To brokers and dealers: 10 U.S. treasury securities........................... 171 289 143 138 137 261 137 140 139 11 Other securities.......................................... 4,234 4,281 4,030 4,038 4,024 4,070 4,345 4,166 3,961 To others: 12 U.S. Treasury securities.......................... 81 81 79 79 80 78 75 74 75 13 Other securities.......................................... 2,270 2,291 2,284 2,277 2,261 2,234 2,242 2,205 2,220 To nonbank financial institutions: 14 Personal and sales finance cos., etc........... 5,020 5,013 4,988 4,917 4,901 4,988 5,042 5,075 5,103 15 Other............................................................... 10,315 10,223 10,176 10,023 10,173 10,125 10,121 10,111 10,230 16 Real estate.......................................................... 66,196 66,344 66,494 66,648 66,830 66,996 67,356 67,552 67,802 To commercial banks: 17 Domestic........................................................ 1,611 1,478 1,431 1,378 1,446 1,440 1,325 1,392 1,467 18 Foreign............................................................ 3,539 3,568 3,430 3,358 3,517 3,344 3,321 3,250 3,316 19 Consumer instalment....................................... 42,464 42,389 42,360 42,384 42,465 42,442 42,549 42,653 42,898 20 Foreign govts., official institutions, etc........ 1,432 1,454 1,430 1,432 1,418 1,474 1,391 1,423 1,492 21 All other loans.................................................. 16,892 16,576 16,803 16,668 16,892 16,747 16,858 16,708 16,588 22 Less: Loan reserve and unearned income on loans.............................................................. 7,769 7,809 7,836 7,857 7,835 7,908 7,947 7,976 7,952 23 Other loans, net...................................................... 241,540 241,433 241,682 241,459 243,181 243,664 244,737 245,264 246,061 Investments: 24 U.S. Treasury securities........................................ 33,852 33,974 34,349 34,322 34,604 36,117 35,750 35,163 34,876 25 Bills...................................................................... 5,023 5,231 5,342 5,240 5,176 6,153 5,856 5,488 5,257 Notes and bonds, by maturity: 26 Within 1 year................................................. 7,091 7,182 6,932 6,893 7,186 7,184 7,185 7,134 7,142 27 1 to 5 years..................................................... 18,528 18,403 18,728 18,714 18,752 19,367 19,483 19,317 19,170 28 After 5 years................................................... 3,210 3,158 3,347 3,475 3,490 3,413 3,226 3,224 3,307 29 Other securities....................................................... 55,500 55,845 55,618 55,565 55,736 55,828 56,220 56,198 56,092 Obligations of States and political sub divisions : 30 Tax warrants, short-term notes, and bills. 5,693 6,115 5,709 5,692 5,732 5,788 6,113 5,923 5,788 31 Allother......................................................... 36,309 36,403 36,596 36,525 36,360 36,440 36,580 36,560 36,539 Other bonds, corporate stocks, and securities: 32 Certificates of participation2...................... 2,306 2,283 2,268 2,282 2,339 2,337 2,339 2,337 2,361 33 All other, including corporate stocks.... 11,192 11,044 11,045 11,066 11,305 11,263 11,188 11,378 11,404 34 Cash items in process of collection....................... 28,897 25,628 28,869 31,954 31,749 25,425 30,204 26,437 24,628 35 Reserves with F.R. Banks....................................... 15,550 15,907 16,115 17,429 15,766 14,998 14,498 15,976 17,831 36 Currency and coin..................................................... 5,118 4,897 5,228 5,374 5,139 4,870 5,102 5,180 5,547 37 Balances with domestic banks............................... 7,678 7,930 7,537 8,067 7,725 7,203 7,172 6,868 7,202 38 Investments in subsidiaries not consolidated.... 1,527 1,653 1,544 1,593 1,523 1,561 1,554 1,495 1,498 39 Other assets................................................................. 38,143 37,521 37,222 36,863 37,387 37,664 38,402 37,876 38,589 40 Total assets/total liabilities...................................... 448,973 445,867 448,655 451,697 452,575 449,369 456,012 450,344 452,891 Deposits: 133,761 129,430 133,883 134,214 134,983 128,314 136,552 127,200 127,810 42 Individuals, partnerships, and corps............. 105,164 103,028 105,139 105,146 105,820 102,333 106,565 101,583 101,618 43 States and political subdivisions................... 6,203 5,434 6,271 5,469 5,623 4,992 5,295 5,395 5,102 44 U.S. Govt............................................................ 1,847 1,083 1,631 2,488 2,377 961 4,493 1,626 2,265 Domestic interbank: 45 Commercial.................................................... 14,058 13,872 14,821 15,390 14,786 14,061 14,165 12,878 13,202 46 Mutual savings.............................................. 420 450 423 426 432 418 419 386 358 Foreign: 47 Governments, official institutions, etc.... 259 251 242 239 226 255 213 230 219 48 Commercial banks........................................ 1,501 1,558 1,416 1,429 1,501 1,578 1,548 1,512 1,505 49 Certified and officers’ checks......................... 4,309 3,754 3,940 3,627 4,218 3,716 3,854 3,590 3,541 206,849 207,919 207,853 208,508 209,502 211,787 212,693 214,163 215,143 51 Savings4............................................................... 82,564 82,771 82,746 82,787 82,732 83,163 83,348 83,616 84,041 52 Time..................................................................... 124,285 125,148 125,107 125,721 126,770 128,624 129,345 130,547 131,102 53 Individuals, partnerships, and corps......... 94,464 95,084 95,144 95,323 95,919 97,350 98,167 99,303 99,802 54 States and political subdivisions............... 22,381 22,660 22,565 22,937 23,191 23,283 23,126 23,281 23,237 55 Domestic interbank...................................... 3,404 3,427 3,368 3,442 3,633 3,907 3,963 3,943 3,991 56 Foreign govts., official institutions, etc... 3,305 3,275 3,314 3,309 3,326 3,309 3,331 3,266 3,305 57 Federal funds purchased, etc. 5............................... 58,092 58,354 56,657 58,819 56,692 57,325 55,493 57,265 58,433 Borrowings from: 58 F.R. Banks.............................................................. 592 33 192 99 494 111 197 165 119 59 Others...................................................................... 2,740 2,730 2,735 2,829 2,809 3,075 2,879 2,947 2,991 60 Other liabilities, etc.6................................................ 14,726 15,163 15,176 15,032 15,814 16,396 16,004 16,340 16,056 61 Total equity capital and subordinated notes / debentures 7.............................................. 32,213 32,238 32,159 32,196 32,281 32,361 32,194 32,264 32,339 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. 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Weekly Reporting Banks A23 1.30 LARGE WEEKLY REPORTING COMMERCIAL BANKS Balance Sheet Memoranda Millions of dollars, Wednesday figures 1978 Account Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. Ip Mar. 8* Mar. 15* Mar. 22* Mar. 29* Total loans (gross) and investments adjusted1 1 Large Banks...................................................... 432,187 434,562 432,943 431,199 433,821 437,969 440,526 435,827 435,070 2 New York City banks................................... 90,059 92,016 91,117 90,067 90,640 91,142 92,276 89,157 88,025 3 Banks outside New York City..................... 342,128 342,546 341,826 341,132 343,181 346,827 348,250 346,670 347,045 Total loans (gross), adjusted 4 Large banks....................................................... 322,136 324,340 321,960 320,569 323,058 325,309 327,768 324,720 325,163 5 New York City banks................................. 69,360 71,613 70,101 69,324 70,217 70,427 71,488 69,411 69,086 6 Banks outside New York City..................... 252,776 252,727 251,859 251,245 252,841 254,882 256,280 255,309 256,077 Demand deposits, adjusted2 7 Large Banks...................................................... 114,645 117,286 112,975 109,208 112,192 111,201 112,267 110,991 112,769 8 New York City banks................................... 25,686 28,439 24,413 24,826 26,121 23,334 24,577 24,732 25,054 9 Banks outside New York City..................... 88,959 88,847 88,562 84,382 86,071 87,867 87,690 86,259 87,715 Large negotiable time CD’s included in time and savings deposits3 Total: 10 Large banks........................................................... 76,602 76,736 76,545 77,108 78,148 79,640 79,956 81,111 82,293 11 New York City.............................................. 24,551 24,159 24.022 24,366 24,490 24,474 24,136 24,301 24,737 12 Banks outside New York City..................... 52,051 52,577 52.523 52,742 53,658 55,166 55,820 56,810 57,556 Issued to IPC’s: 13 Large banks....................................................... 51,762 51,727 51.523 51,888 52,506 53,931 54,292 55,533 56,476 14 New York, City Banks................................ 16,941 16,583 16.447 16,827 16,817 17,029 16,729 16,960 17,380 15 Banks outside New York City..................... 34,821 35,144 35,076 35,061 35,689 36,902 37,563 38,573 39,096 Issued to others: 16 Large banks........................................................ 24,840 25,009 25.022 25,220 25,642 25,709 25,664 25,578 25,817 17 New York City banks................................. 7,610 7,576 7,575 7,539 7,673 7,445 7,407 7,341 7,357 18 Banks outside New York City..................... 17,230 17,433 17.447 17,681 17,969 18,264 18,257 18,237 18,460 All other large time deposits4 Total: 19 Large banks........................................................... 31,009 31,190 31,136 31,387 31,660 31,722 31,716 31,727 31,477 20 New York City banks................................... 6,209 6,180 6,182 6,075 6,118 6,018 6,001 5,920 5,829 21 Banks outside New York City................... 24,800 25,010 24,954 25,312 25,542 25,704 25,715 25,807 25,648 Issued to IPC’s: 22 Large banks....................................................... 17,578 17,732 17,805 17,898 18,035 17,978 18,079 18,062 18,001 23 New York City banks................................... 4,808 4,768 4,758 A,129 4,782 4,694 4,705 4,644 4,576 24 Banks outside New York City..................... 12,770 12,964 13,047 13,169 13,253 13,284 13,374 13,418 13,425 Issued to others: 25 Large banks....................................................... 13,431 13,458 13,331 13,489 13,625 13,744 13,637 13,665 13,476 26 New York City banks.................................. 1,401 1,412 1,424 1,346 1,336 1,324 1,296 1,276 1,253 27 Banks outside New York City..................... 12,030 12,046 11,907 12,143 12,289 12,420 12,341 12,389 12,223 Savings deposits, by ownership category Individuals and nonprofit organizations: 28 Large banks....................................................... 86,143 86,255 86,270 86,290 86,218 86,628 86,881 87,187 87,601 29 New York City banks................................. 9,212 9,223 9,236 9,224 9,Ml 9,201 9,197 9,217 9,273 30 Banks outside New York City..................... 76,931 77,032 77,034 77,066 77,041 77,427 77,684 77,970 78,328 Partnerships and corporations for profit:5 31 Large banks....................................................... 4,925 4,961 4,929 4,925 4,897 4,923 4,875 4,898 4,968 32 New York City banks................................. 488 487 484 484 484 480 473 470 478 33 Banks outside New York City.................... 4,437 4,474 4,445 4,441 4,413 4,443 4,402 4,428 4,490 Domestic governmental units: 34 Large banks....................................................... 1,429 1,522 1,507 1,532 1,495 1,499 1,477 1,412 1,414 35 New York City banks................................. 246 270 254 264 230 218 225 201 205 36 Banks outside New York City..................... 1,183 1,252 1,253 1,268 1,265 1,281 1,252 1,211 1,209 All other:6 37 Large banks....................................................... 32 29 30 29 32 39 32 27 31 38 New York City banks.................................. 19 16 16 17 19 21 22 20 17 39 Banks outside New Yotk City.................... 13 13 14 12 13 12 10 7 14 Gross liabilities of banks to their foreign branches 4 41 0 La N rg e e w b a Y n o k r s k . .. C .. i . t .. y .. . b .. a .. n .. k ... s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 3 , , 8 9 0 33 3 6 3 , , 3 7 2 48 2 5 7 , , 3 3 5 6 5 6 2 5 , , 8 0 9 7 9 2 2 4 , , 4 7 2 6 4 5 2 4 , , 5 9 2 5 1 8 5 3 , , 8 57 8 3 7 2 4 , , 2 6 3 4 9 5 2 4 , ,5 6 8 1 1 9 42 Banks outside New York City................... 1,870 2,574 2,011 2,173 2,341 2,437 2,314 2,406 1,962 Loans sold outright to selected institutions by all large banks7 43 Commercial and industrial............................. 3,054 3,060 3,038 2,998 2,989 2,919 2,973 2,949 2,944 44 Real estate........................................................ 231 235 231 234 236 239 236 237 237 45 All other.......................................................... 1,163 1,171 1,157 1,071 1,072 1,052 1,049 1,029 952 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. t 7 To bank’s own foreign branches, nonconsolidated nonbank af 3 Certificates of deposit (CD’s) issued m denommations ol $100,000 or filiates of the bank, the bank's holding company (if not a bank), and nonconsolidated nonbank subsidiaries of the holding company. m(*All other time deposits issued in denominations of $100,000 or more not included in large negotiable (CD’s). 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A24 Domestic Financial Statistics □ April 1978 1.31 LARGE WEEKLY REPORTING COMMERCIAL BANKS Commercial and Industrial Loans Millions of dollars Outstanding Net change during— Adjust Industry classification 1978 1977 1978 1978 ment bank A Mar. lp Mar. 8*>Mar. 15pMar. 22pMar. 29p Q4 Q1p Jan.r Feb. Mar.? Total loans classified2 1 Total........................................................... 103,215 103,592 104,340 104,524 104,768 4,395 2,108 -1,656 1,198 2,481 745 Durable goods manufacturing: 2 Primary metals...................................... 2,719 2,736 2,767 2,760 2,754 256 -79 -273 119 68 90 3 Machinery.............................................. 5,015 5,072 5,181 5,196 5,234 -4 485 -73 288 276 176 4 Transportation equipment................. 2,637 2.678 2,718 2,751 2,723 -89 444 124 155 168 -21 5 Other fabricated metal products.... 2,080 2,154 2,188 2,233 2,272 -26 338 82 76 193 -28 6 Other durable goods........................... 3,395 3,402 3,460 3,481 3,533 -231 48 -132 39 145 -20 Nondurable goods manufacturing: 7 Food, liquor, and tobacco................. 3,774 3,800 3,817 3,883 3,853 324 89 -35 11 76 21 8 Textiles, apparel, and leather............ 3,479 3,571 3,571 3,594 3,572 -663 279 -116 165 231 -65 9 Petroleum refining................................ 2,691 2.568 2,462 2,449 2,478 235 -227 1 -41 -181 -249 10 Chemicals and rubber......................... 3,197 3,330 3,379 3,393 3,415 -37 535 18 244 270 39 11 Other nondurable goods..................... 2,192 2,179 2,202 2,217 2,206 74 -60 -12 -17 -33 26 12 Mining, including crude petroleum and natural gas................................. 9,241 9,342 9,465 9,500 9,526 537 451 -32 88 395 306 Trade: 13 Commodity dealers............................. 2,266 2,198 2,242 2,203 2,251 502 304 241 -19 78 125 14 Other wholesale.................................... 8,200 8,331 8,361 8,417 8,486 439 783 83 227 487 390 15 Retail...................................................... 7,405 7,505 7,471 7,548 7,626 -235 535 -16 284 297 96 5,333 5,377 5,498 5,559 5,602 17 354 -2 54 326 239 17 Communication........................................ 1,487 1.464 1,495 1,475 1,416 115 19 50 57 -96 22 18 Other public utilities................................ 5,253 5,162 5,128 5,038 4,971 290 -567 -16 -178 -375 210 19 Construction.............................................. 4,544 4,555 4,576 4,628 4,634 -31 202 44 -14 170 -39 12,183 12,216 12,264 12,312 12,304 286 673 233 179 263 330 7,647 7,557 7,648 7,672 7,450 419 79 -38 178 -174 -857 22 Bankers acceptances................................ 3,708 3,604 3,619 3,439 3,690 2,455 -2,553 -1,845 -574 -114 2 23 Foreign commercial and industrial loans................................................... 4,769 4,791 4,828 4,776 4,772 -238 -24 58 -123 11 -48 Memo Items: 24 Commercial paper included in total classified loans1................................ 131 -75 -27 -11 -11 — 5 25 Total commercial and industrial loans of all large weekly reporting banks.................................................. 126,773 127,137 128,042 128,362 128,805 ••5,622 3,065 -1,854 1,633 3,196 -13 1977 1978 1977 1978 1978 Adjust ment bank A Nov. 30 Dec. 28 Jan. 25 Feb. 22 Mar. 29 Q4 Ql Jan.r Feb. Mar. “Terms” loans classified3 26 Total........................................................... 46,660 46,626 48,215 *•48,818 49,366 352 1,900 749 603 548 840 Durable goods manufacturing: 27 Primary metals...................................... 1,405 1,546 1,559 1,564 1,576 120 -16 -33 5 12 46 28 Machinery.............................................. 2,319 2,286 2,403 2,473 2,529 -51 203 77 70 56 40 29 Transportation equipment................. 1,339 1,317 1,432 1,466 1,489 -112 152 95 34 23 20 30 Other fabricated metal products----- 838 834 882 877 902 59 50 30 -5 25 18 31 Other durable goods........................... 1,742 1,698 1,630 1,602 1,572 -76 -105 -47 -28 -30 -21 Nondurable goods manufacturing: 32 Food, liquor, and tobacco................. 1,442 1,498 1,436 1,492 1,522 98 69 -17 56 30 -45 33 Textiles, apparel, and leather............ 1,142 1,058 973 983 1,038 -96 40 -25 10 55 -60 34 Petroleum refining............................... 2,167 2,268 2,136 '2,000 1,873 271 -174 89 r —136 -127 -221 35 Chemicals and rubber......................... 1,770 1,727 1,926 2,017 2,116 -18 215 25 91 99 174 36 Other nondurable goods..................... 1,119 1,147 1,198 1,182 1,169 53 2 31 -16 -13 20 37 Mining, including crude petroleum and natural gas................................ 6,412 6,501 6,569 6,811 7,084 217 530 15 242 273 53 Trade: 38 Commodity dealers............................. 234 236 294 262 254 42 -16 24 -32 -8 34 39 Other wholesale.................................... 1,592 1,665 1,874 1,928 1,993 125 202 83 54 65 126 40 Retail...................................................... 2,583 2,448 2,476 2,539 2,554 48 54 -24 63 15 52 41 Transportation.......................................... 3,651 3,484 3,726 3,747 3,885 -141 233 74 21 138 168 42 Communication........................................ 835 840 901 908 924 54 47 24 7 16 37 43 Other public utilities................................ 3.294 3,266 3,802 3,855 3,822 -36 -34 -54 53 -33 590 44 Construction.............................................. 2,007 1,990 2,002 1,973 2,066 -21 165 101 -29 93 -89 5,250 5,366 5,746 5,807 5,880 85 307 173 61 73 207 46 All other domestic loans........................ 2,641 2,726 2,627 2,750 2,457 184 -57 113 123 -293 -212 47 Foreign commercial and industrial 2,878 2,725 2,623 2,582 2,661 -453 33 -5 -41 79 -97 1 Reported for the last Wednesday of each month. A These amounts represent accumulated adjustments originally made 2 Includes “term” loans, shown below. to offset the cumulative effects of mergers. A “positive” adjustment bank 3 Outstanding loans with an original maturity of more than 1 year and should be added to, and a “negative” adjustment bank substracted from, all outstanding loans granted under a formal agreement—revolving credit outstanding data for any date in the year to establish comparability with or standby—on which the original maturity of the commitment was in any date in the subsequent year. Figures for the adjustment bank shown excess of 1 year. here represent revisions of figures shown in the February Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Deposits and Commercial Paper A25 1.32 GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations Billions of dollars, estimated daily-average balances At commercial banks Type of holder 1976 1977 1972 1973 1974 1975 Dec. Dec. Dec. Dec. Sept. Dec. Mar. June Sept. Dec. 208.0 220.1 225.0 236.9 236.1 250.1 242.3 253.8 252.7 274.4 18.9 19.1 19.0 20.1 19.7 22.3 21.6 25.9 23.7 25.0 109.9 116.2 118.8 125.1 122.6 130.2 125.1 129.2 128.5 142.9 65.4 70.1 73.3 78.0 80.0 82.6 81.6 84.1 86.2 91.0 1.5 2.4 2.3 2.4 2.3 2.7 2.4 2.5 2.5 2.5 12.3 12.4 11.7 11.3 11.5 12.4 11.6 12.2 11.8 12.9 At weekly reporting banks 1977 1978 1974 1975 1976 Dec. Dec. Dec. Aug. Sept. Oct. Nov. Dec. Jan. Feb. 7 All holders, IPC......................................................... 119.7 124.4 128.5 128.0 129.2 131.4 133.0 139.1 137.1 132.5 8 Financial business....................................................... 14.8 15.6 17.5 18.0 17.4 18.0 17.9 18.5 18.3 18.1 66.9 69.9 69.7 68.8 70.0 72.1 72.2 76.3 73.8 70.7 29.0 29.9 31.7 32.4 32.8 32.4 33.4 34.6 35.2 34.4 2.2 2.3 2.6 2.5 2.4 2.3 2.5 2.4 2.4 2.4 12 Other.............................................................................. 6.8 6.6 7.1 6.4 6.6 6.7 7.0 7.4 7.4 6.9 Note.—Figures include cash items in process of collection. Estimates of Data for August 1976 have been revised as follows: All holders, ipc, gross deposits are based on reports supplied by a sample of commercial 119.4; financial business, 15.3; nonfinancial business, 65.5; consumer, banks. Types of depositors in each category are described in the June 1971 30.0; foreign, 2.5; all other, 6.1. Bulletin, p. 466. 1.33 COMMERCIAL PAPER AND BANKERS ACCEPTANCES OUTSTANDING Millions of dollars, end of period 1977 1978 1975 1976 1977 Instrument Dec. Dec. Dec. Aug. Sept. Oct. Nov. Dec. Jan. Feb. Commercial paper (seasonally adjusted) 1 48,459 53,025 65,112 60,014 61,542 62,724 62,753 65,112 r65,488 65,477 Financial companies:1 Dealer-placed paper:2 2 Total...................................................................... 6,202 7,250 8,871 8,149 8,471 8,540 8,497 8,871 9,018 8,918 3 Bank-related......................................................... 1,762 1,900 2,132 1,650 1,846 1,961 1,980 2,132 2,035 1,997 Directly-placed paper: 3 4 31,374 32,500 40,399 36,847 37,850 38,803 38,954 40,399 r41,586 42,137 5 Bank-related......................................................... 6,892 5,959 7,003 6,394 7,069 7,012 6,567 7,003 7,109 7,616 10,883 13,275 15,842 15,018 15,221 15,381 15,302 15,842 14,884 14,422 Dollar acceptances (not seasonally adjusted) 7 Total.............................................................................. 18,727 22,523 25,654 23,091 23,317 23,908 24,088 25,654 25,252 25,411 Held by: 8 7,333 10,442 10,434 7,647 7,473 8,673 8,952 10,434 7,785 7,513 9 Own bills.............................................................. 5,899 8,769 8,915 6,580 6,566 7,248 7,702 8,915 6,772 6,583 10 Bills bought......................................................... 1,435 1,673 1,519 1,067 907 1,424 1,251 1,519 1,013 931 F.R. Banks: 11 Own account....................................................... 1 126 991 954 131 482 248 954 12 Foreign correspondents.................................... 293 375 362 304 287 422 392 362 371 456 13 Others........................................................................ 9,975 *•10,715 13,904 15,009 15,075 14,813 14,495 13,904 17,096 17,442 Based on: 14 3,726 4,992 6,532 5,446 5,654 5,886 5,973 6,532 6,637 6,842 15 Exports from United States................................. 4,001 4,818 5,895 5,747 5,544 5,584 5,803 5,895 5,840 5,739 16 All other................................................................... 11,000 12,713 13,227 11,899 12,119 12,438 12,312 13,227 12,774 13,026 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 a April 1978 1.34 PRIME RATE CHARGED BY BANKS on Short-term Business Loans Per cent per annum Month Average Month Average Effective date Rate Effective date Rate rate rate 1976—June 1.............. 7 1977—May 13............ 1976—Aug........................ 7.01 1977—June........................ 6.75 7.............. 71/4 31............ 634 Sept........................ 7.00 July........................ 6.75 Oct......................... 6.78 Aug......................... 6.83 Aug. 2.............. 7 Aug. 22............. 7 Nov........................ 6.50 Sept........................ 7.13 Dec......................... 6.35 Oct.......................... 7.52 Oct. 4.............. 6V4 Sept. 16............. 1V4 Nov......................... 7 75 1977—jan.......................... Dec......................... 7.75 Nov. 1.............. 6 % Oct. 7............... 7 lA Feb........................ 6.25 Oct. 24.............. m Mar....................... 6.25 1978—Jan.......................... 7.93 Dec. 13.............. 6V4 Apr........................ 6.25 Feb......................... 8.00 1978—Jan. 10.............. 8 May........................ 6.41 8.00 1.35 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, Nov. 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 Short-term commercial and industrial loans 1 Amount of loans (thousands of dollars)........................ 6,072,726 851,244 419,038 665,606 1,424,620 452,092 2,260,100 2 Number of loans................................................................... 160,328 128,055 12,690 10,986 7,097 719 830 3 Weighted-average maturity (months).............................. 3.1 2.8 2.8 3.6 2.7 3.3 3.3 4 Weighted-average interest rate (per cent per annum).. 8.66 9.53 9.12 9.02 8.74 8.47 8.14 5 Interquartile range 1........................................................ 7.98-9.20 8.68-10.50 8.51-9.58 8.30-9.46 8.00-9.25 7.98-8.86 7.75-8.48 Percentage of amount of loans: 6 With floating rate............................................................. 59.2 36.5 45.9 43.9 66.2 60.2 70.1 7 Made under commitment............................................... 40.4 15.9 19.7 22.8 34.8 60.6 58.1 Long-term commercial and industrial loans ----------------✓ 8 Amount of loans (thousands of dollars)......................... 1,035,642 318,418 154,405 65,136 497,682 9 Number of loans.................................................................. 22,711 21,516 981 99 115 10 Weighted-average maturity (months).............................. 44.7 36.9 35.6 41.5 52.9 11 Weighted-average interest rate (per cent per annum).. 8.71 9.16 9.03 8.87 8.30 12 Interquartile range 1........................................................ 8.14-9.46 8.42-10.00 8.75-9.38 7.98-9.75 7.95-9.11 Percentage of amount of loans: 13 With floating rate............................................................. 53.4 30.3 41.2 71.9 69.5 14 Made under commitment............................................... 48.3 36.8 37.8 61.7 57.1 Construction and land development loans 15 Amount of loans (thousands of dollars)..................... 597,800 183,346 85,429 81,873 134,728 112,423 16 Number of loans.............................................................. 26,608 22,199 2,381 1,261 684 82 17 Weighted-average maturity (months).......................... 8.8 8.3 5.9 8.2 9.1 11.3 18 Weighted-average interest rate (per cent per annum) 9.19 9.36 8.99 9.68 9.34 8.54 19 Interquartile range 1................................................... 8.75-9.92 9.00-9.88 8.03-9.50 9.32-10.00 8.84-9.84 8.00-9.95 Percentage of amount of loans: 20 With floating rate......................................................... 37.7 8.8 17.0 24.8 57.1 86.7 21 Secured by real estate................................................. 77.6 68.4 65.3 93.6 90.9 74.3 22 Made under commitment.......................................... 50.1 30.8 44.9 41.9 73.7 63.1 23 Type of construction: 1-to 4-family..................... 44.1 61.9 57.8 70.9 29.3 (2) 24 Multifamily.......................... 8.7 1.0 2.2 6.4 16.7 18.3 25 Nonresidential.................... 47.2 37.1 39.9 22.8 54.0 79.0 All 250 sizes 1-9 10-24 25-49 50-99 100-249 and over Loans to farmers 26 Amount of loans (thousands of dollars)....................... 708,677 146,348 136,967 93,587 103,885 81,366 146,525 27 Number of loans............................................................ 53,761 39,139 9,627 2,704 1,498 576 217 28 Weighted-average maturity (months)........................... 9.4 8.0 8.3 21.0 6.5 6.6 7.9 29 Weighted-average interest rate (per cent per annum).. 9.12 9.14 9.03 9.07 8.91 9.10 9.35 30 Interquartile range 1.................................................. 8.68-9.40 8.68-9.38 8.71-9.31 8.68-9.50 8.68-9.24 8.68-9.40 8.75-9.69 By purpose of loan: 31 Feeder livestock...................................................... 8.93 8.94 8.87 8.79 9.03 9.22 8.88 32 Other livestock........................................................ 9.06 9.36 8.98 9.82 8.44 9.09 9.05 33 Other current operating expenses.......................... 9.20 9.09 9.09 9.14 8.88 9.23 9.60 34 Farm machinery and equipment........................... 9.18 9.41 9.27 9.17 8.83 8.62 (2) 35 Other........................................................................ 9.19 9.03 9.10 9.19 9.31 8.89 9.37 1 Interest rate range that covers the middle 50 per cent of the total Note.—For more detail, see the Board’s G.14 statistical release. dollar amount of loans made. 2 Fewer than three sample loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Securities Markets A27 1.36 INTEREST RATES Money and Capital Markets Averages, per cent per annum 1977 1978 1978, week ending- 1975 1976 1977 Dec. Jan. Feb. Mar. Mar. 4 Mar. 11 Mar. 18 Mar. 25 Apr. 1 Money market rates 1 Federal funds 1. 5.82 5.05 5.54 6.56 6.70 6.78 6.79 6.80 6.76 6.77 6.77 6.82 Prime commercial paper : 2 90- to 119-day.............. 6.26 5.24 5.54 6.61 6.75 6.76 6.75 6.75 6.75 6.75 6.75 6.75 3 4- to 6-month............... 6.33 5.35 5.60 6.64 6.79 6.80 6.80 6.80 6.79 6.79 6.80 6.80 4 Finance company paper, directly placed, 3- to 6-month 3...................................... 6.16 5.22 5.49 6.52 6.69 6.74 6.73 6.73 6.73 6.73 6.74 6.75 5 Prime bankers acceptances, 90-day 4... 6.30 5.19 5.59 6.60 6.86 6.82 6.79 6.80 6.80 6.80 6.76 6.80 Large negotiable certificates of deposit 3-month, secondary market 5. 6.43 5.26 5.58 6.72 6.71 6.89 6.85 6.88 6.87 6.83 6.84 6.86 3-month, primary market 6. 5.15 5.52 6.64 6.83 6.77 6.75 6.75 6.75 6.75 6.74 6.74 8 Euro-dollar deposits, 3-month 7. 6.97 5.57 6.05 7.15 7.32 7.28 7.27 7.34 7.30 7.20 7.24 7.34 U.S. Govt, securities Bills:8 Market yields: 9 3-month............................... 5.80 4.98 5.27 6.07 6.44 6.45 6.29 6.39 6.29 6.27 6.21 6.34 10 6-month............................... 6.11 5.26 5.53 6.40 6.70 6.74 6.63 6.70 6.64 6.61 6.57 6.66 11 1-year................................... 6.30 5.52 5.71 6.52 6.80 6.86 6.82 6.84 6.81 6.80 6.77 6.89 Rates on new issue: 12 3-month............................... 5.838 4.989 5.265 6.063 6.448 6.457 6.319 6.429 6.349 6.302 6.207 6.310 13 6-month............................... 6.122 5.266 5.510 6.377 6.685 6.740 6.644 6.709 6.676 6.624 6.547 6.666 Constant maturities:9 14 1-year......................... 6.76 5.88 6.09 6.96 7.28 7.34 7.31 7.34 7.29 7.28 7.25 7.39 Capital market rates Government notes and bonds U.S. Treasury Constant maturities:9 15 2-year............................. 6.45 7.18 7.49 7.57 7.58 7.59 7.56 7.54 7.54 7.65 16 3-year............................. 7.49 6.77 6.69 7.30 7.61 7.67 7.70 7.71 7.69 7.64 7.65 7.79 17 5-year............................. 7.77 7.18 6.99 7.48 7.77 7.83 7.86 7.87 7.85 7.81 7.81 7.94 18 7-year............................. 7.90 7.42 7.23 7.59 7.86 7.94 7.95 7.95 7.94 7.91 7.90 8.02 19 10-year........................... 7.99 7.61 7.42 7.69 7.96 8.03 8.04 8.04 8.03 8.00 7.98 8.12 20 20-year........................... 8.19 7.86 7.67 7.87 8.14 8.22 8.21 8.21 8.21 8.17 8.17 8.27 21 30-year........................... 7.94 8. 18 8.25 8.23 8.25 8.23 8.20 8.19 8.30 Notes and bonds maturing in ] 22 3 to 5 years............................. 7.55 6.94 6.85 7.40 7.71 7.76 7.76 7.78 7.77 7.72 7.71 7.83 23 Over 10 years (long-term)... 6.98 6.78 7.06 7.23 7.50 7.60 7.63 7.64 7.62 7.60 7.60 7.68 State and local: Moody’s series:11 24 Aaa.......................... 6.42 5.66 5.20 5.07 5.20 5.24 5.11 5.15 5.10 5.10 5.10 5.10 25 Baa........................... 7.62 7.49 6.12 5.79 5.91 5.82 5.85 5.95 5.85 5.85 5.85 5.75 26 Bond Buyer series 12. 7.05 6.64 5.68 5.57 5.71 5.62 5.61 5.63 5.58 5.58 5.59 5.69 Corporate bonds Seasoned issues 13 All industries........ 9.57 9.01 8.43 8.54 8.74 8.78 8.80 8.80 8.81 8.79 8.78 8.81 By rating groups: Aaa...................... 8.83 8.43 8.02 8.19 8.41 8.47 8.47 8.49 8.48 8.45 8.45 8.48 Aa....................... 9.17 8.75 8.24 8.40 8.59 8.65 8.66 8.68 8.68 8.66 8.63 8.67 A.......................... 9.65 9.09 8.49 8.57 8.76 8.79 8.83 8.82 8.83 8.82 8.83 8.85 Baa...................... 10.61 9.75 8.97 8.99 9.17 9.20 9.22 9.21 9.22 9.22 9.21 9.25 iaa utility bonds:14 32 New issue....................... 9.40 8.48 8.19 8.34 8.68 8.69 8.71 8.70 8.61 8.83 33 Recently offered issues. 9.41 8.49 8.19 8.38 8.60 8.67 8.67 8.70 8.65 8.64 8.64 8.75 Dividend/price ratio 34 Preferred stocks. 8.38 7.97 7.60 7.85 7.93 7.99 8.07 8.06 8.06 8.04 8.06 8.13 35 Common stocks. 4.31 3.77 4.56 5.11 5.32 5.49 5.68 5.75 5.72 5.65 5.64 5.63 1 Weekly figures are 7-day averages of daily effective rates for the week 7 Averages of daily quotations for the week ending Wednesday. ending Wednesday; the daily effective rate is an average of the rates on 8 Except for new bill issues, yields are computed from daily closing a given day weighted by the volume of transactions at these rates. bid prices. Yields for all bills are quoted on a bank-discount basis. 2 Beginning Nov. 1977, unweighted average of offering rates quoted 9 Yields on the more actively traded issues adjusted to constant by five dealers. Previously, most representative rate quoted by those maturities by the U.S. Treasury, based on daily closing bid prices. dealers. !0 Unweighted averages for all outstanding notes and bonds in maturity 3 Averages of the most representative daily offering rates published by ranges shown, based on daily closing bid prices. “Long-term” includes finance companies for varying maturities in this range. all bonds neither due nor callable in less than 10 years. 4 Beginning Aug. 15, 1974, the rate is the average of the midpoint of 11 General obligations only, based on figures for Thursday, from the range of daily dealer closing rates offered for domestic issues; prior Moody’s Investors Service. data are averages of the most representative daily offering rate quoted by 12 Twenty issues of mixed quality. dealers. 13 Averages of daily figures from Moody’s Investors Service. 5 Weekly figures (week ending Wednesday) are 7-day averages of the 14 Compilation of the Board of Governors of the Federal Reserve daily midpoints as determined from the range of offering rates at large System. New York City banks; monthly figures are averages of total days in the Issues included are long-term (20 years or more). New-issue yields are month. based on quotations on date of offering; those on recently offered issues 6 Posted rates, which are the annual interest rates most often quoted (included only for first 4 weeks after termination of underwriter price on new offerings of negotiable CD’s in denominations of $100,000 or restrictions), on Friday close-of-business quotations. more by large New York City banks. Rates prior to 1976 not available. Weekly figures are for Wednesday dates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A28 Domestic Financial Statistics □ April 1978 1.37 STOCK MARKET Selected Statistics 1977 1978 Indicator 1975 1976 1977 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Prices and trading (averages of daily figures) Common stock prices 1 New York Stock Exchange (Dec. 31,1965 = 50). 45.73 54.45 53.67 52.66 51.37 51.87 51.83 49.89 49.41 49.50 2 Industrial............................................................ 51.88 60.44 57.84 56.41 54.99 55.62 55.55 53.45 52.80 52.77 3 Transportation................................................... 30.73 39.57 41.07 39.99 38.33 39.30 39.75 39.15 38.90 38.95 31.45 36.97 40.91 40.93 40.38 40.33 40.36 39.09 39.02 39.26 46.62 52.94 55.23 55.33 53.24 54.04 53.85 50.91 50.60 51.44 6 Standard & Poor’s Corporation (1941-43 = 10)1.. 85.17 102.01 98.18 96.23 93.78 94.28 93.82 90.28 88.98 88.82 7 American Stock Exchange (Aug. 31,1973 = 100). 83.15 101.63 116.18 118.08 115.41 117.80 124.88 121.73 123.35 126.11 Volume of trading (thousands of shares)2 8 New York Stock Exchange............................... 18,568 21,189 20,936 18,270 19,689 23,557 21,475 20,388 19,400 22,617 9 American Stock Exchange................................ 2,150 2,565 2,514 2,080 2,080 2,061 3,008 2,254 2,300 2,940 Customer financing (end-of-period balances, in millions of dollars) 10 Regulated margin credit at brokers/dealers and banks3................................................. 6,500 9,011 10,866 10,617 10,583 10,680 10,866 10.690 11 Brokers, total................................................ 5,540 8,166 9,993 9,793 9,756 9,859 9,993 9,839 10,024 12 Margin stock4.............................................. 5,390 7,960 9,740 9,590 9,560 9,610 9,740 9,590 9,780 13 Convertible bonds........................................ 147 204 250 196 192 246 250 246 242 14 Subscription issues...................................... 3 2 3 7 4 3 3 3 2 15 Banks, total................................................... 960 845 873 824 827 822 873 851 16 Margin stocks............................................... 909 800 827 783 783 778 827 809 17 Convertible bonds........................................ 36 30 30 24 27 28 30 27 18 Subscription issues...................................... 15 15 16 17 17 16 16 15 19 Unregulated nonmargin stock credit at banks5 2,281 2,817 2,568 2,581 2,579 2,604 2,568 2,565 Memo: Free credit balances at brokers6 20 Margin-account................................................ 475 585 640 600 - 615 630 640 660 635 21 Cash-account..................................................... 1,525 1,855 2,060 1,745 1,850 1,845 2,060 1,925 1,875 Margin-account debt at brokers (percentage distribution, end of period) 22 Total........................................ 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 By equity class (in per cent):7 23 Under 40.............................. 24.0 12.0 19.0 18.0 27.0 17.0 19.0 25.0 24 40-49.................................... 28.8 23.0 34.0 36.0 35.0 33.0 34.0 34.0 25 50-59.................................... 22.3 35.0 24.0 23.0 18.0 26.0 24.0 20.0 26 60-69.................................... 11.6 15.0 11.0 11.0 9.8 12.0 11.0 10.0 27 70-79....................................... 6.9 8.7 7.0 6.0 6.0 7.0 7.0 6.0 28 80 or more........................... 5.3 6.0 5.0 5.0 5.0 5.0 5.0 5.0 Special miscellaneous-account balances at brokers (end of period) 29 Total balances (millions of dollars)8... 7,290 8,776 9,910 9,640 9,640 9,710 9,910 9,880 Distribution by equity status (per cent) 30 Net credit status................................. 43.8 41.3 43.4 41.7 42.8 41.8 43.4 42.4 Debit status, equity of— 31 60 per cent or more........................ 40.8 47.8 44.9 45.9 43.8 45.5 44.9 43.6 32 Less than 60 per cent..................... 15.4 10.9 11.7 12.4 13.4 12.7 11.7 14.0 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 5Vi-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 1977 1978 1974 1975 1976 Account June July | Aug. Sept. Oct. Nov. Dec. Jan.r Feb. Savings and loan associations 1 Assets........................................ 295,545 338,233 391,907 426,943 433,728 440,101 444,383 450,563 455,644 459,282 464,279 469,692 2 Mortgages................................ 249,301 278,590 323,005 350,632 355,856 361,582 366,838 371,714 376,468 381,216 384,235 387,616 3 Cash and investment securities1............................. 23,251 30,853 35,724 39,693 41,057 41,069 39,709 40,642 40,522 39,197 40,356 41,672 4 Other.......................................... 22,993 28,790 33,178 36,618 36,815 37,450 37,836 38,207 38,654 38,869 39,688 40,404 5 Liabilities and net worth........ 295,545 338,233 391,907 426,943 433,728 440,101 444,383 450,563 455,644 459,282 464,279 469,692 242,974 285,743 335,912 364,222 368,385 371,247 377,208 379,604 381,333 386,875 389,620 391,914 24,780 20,634 19,083 20,756 20,960 22,026 22,920 24,206 25,547 27,803 27,906 28,661 8 FHLBB................................. 21,508 17,524 15,708 15,595 15,724 16,255 16,908 17,546 18,282 19,952 20,136 20,614 3,272 3,110 3.375 5,161 5,236 5,771 6,012 6,660 7,265 7,851 7,770 8,047 3,244 5,128 6^840 9,129 9,338 9,662 9.741 9,856 9,924 9.932 9,849 9,921 11 Other.......................................... 6,105 6,949 8,074 9,374 11,280 13,053 10,176 12,226 13,839 9,491 11,464 13,441 12 Net worth2............................... 18,442 19,779 21,998 23,462 23,765 24,113 24,338 24,671 25,001 25,181 25,440 25,755 13 Memo: Mortgage loan com mitments outstanding3.. 7,454 10,673 14,826 22,032 21,907 21,901 21,631 21,555 21,270 19,886 19,534 20,691 Mutual savings banks 14 Assets........................................ 109,550 121,056 134,812 141,778 143,036 143,815 144,666 145,651 146,346 147,190 148,415 Loans: 15 Mortgage.............................. 74,891 77,221 81,630 84,051 84,700 85,419 86,079 86,769 87,333 88,104 88,815 16 Other..................................... 3,812 4,023 5,183 6,887 7,176 7,119 6,878 7,115 7,241 6,240 6,843 Securities: 17 U.S. Govt.............................. 2,555 4,740 5,840 6,104 6,101 6,019 6,192 6,101 6,071 5,901 5,883 18 State and local government. 930 1,545 2,417 2,544 2,594 2,762 2,111 2,808 2,809 2,828 2,887 19 Corporate and other4........ 22,550 27,992 33,793 36,349 36,674 36,878 36,927 37,073 37,221 37,909 38,260 20 Cash.......................................... 2,167 2,330 2,355 2,071 2,001 1,857 1,992 2,011 1,887 2,416 1,896 21 Other assets.............................. 2,645 3,205 3,593 3,771 3,789 3,760 3,821 3,773 3,783 3,792 3,832 22 Liabilities.................................. 109,550 121,056 134,812 141,778 143,036 143,815 144,666 145,651 146,346 147,190 148,415 23 Deposits.................................... 98,701 109,873 122,877 129,332 130,111 130,381 131,688 132,250 132,537 133,892 134,685 24 Regular:5.............................. 98,221 109,291 121,961 128,071 128,748 129,030 130,230 130,913 131,319 132,608 133,236 25 Ordinary savings............. 64,286 69,653 74,535 77,033 77,069 77,163 77,640 77,503 77.460 77,930 77,680 26 Time and other............... 33,935 39,639 47,426 51,038 51,679 51,867 52,590 53,410 53,859 54,678 55,556 27 Other...................................... 480 582 916 1,261 1,363 1,351 1,458 1,337 1,208 1,284 1,450 28 Other liabilities....................... 2,888 2,755 2,884 2,939 3,379 3,779 3,254 3,632 3,938 3,319 3,665 29 General reserve accounts----- 7,961 8,428 9,052 9,506 9,546 9,654 9,723 9,769 9.882 9,980 10,065 30 Memo : Mortgage loan com mitments outstanding®.. 2,040 1,803 2,439 4,079 4,049 4,198 4,254 4,423 4,458 4,066 3,998 Life insurance companies 31 Assets....................... 263,349 289,304 321,552 334,386 336,651 338,964 341,382 343,738 347,182 350,506 352,914 Securities: 32 Government......... 10,900 13,758 17,942 18,579 18,916 19,174 19,515 19,519 19,681 19,508 19,579 33 United States7 3,372 4,736 5,368 5.400 5,628 5,831 5.883 5,810 5,993 5,693 5,717 34 State and local 3,667 4,508 5,594 5,813 5.847 5,881 5; 994 5,979 5,967 6,016 6,009 35 Foreign8.......... 3,861 4,514 6,980 7,366 7.441 7,462 7,638 7,730 7,721 7,799 7,853 36 Business............... 119,637 135,317 157,246 166,859 168,498 169,747 170,606 172,005 174,109 175,204 177,134 37 Bonds............... 97,717 107,256 122,984 133,497 135,262 136,752 138,046 139,909 141,354 142,095 145,244 38 Stocks............... 21,920 28,061 34,262 33,362 33,236 32,995 32,560 32,096 32,755 33,109 31,890 39 Mortgages............... 86,234 89,167 91,552 92,854 93.106 93,326 94,070 94,684 95,110 96,765 97,171 40 Real estate............... 8,331 9,621 10,476 10,897 10,901 10,926 10,930 11,024 11,113 11,201 11,252 41 Policy loans............. 22,862 24,467 25,834 26,657 26,780 26,946 27,087 27,220 27,355 27,508 27,628 42 Other as sets............ 15,385 16,971 18,502 18,540 18,450 18,845 19,174 19,286 19,814 20,320 20,150 Credit unions 43 Total assets/liabilities and capital............................... 31,948 38,037 45,225 50,186 50,218 50,904 52,136 52,412 53,141 54,084 54,084 54,989 44 Federal.................................. 16,715 20,209 24,396 27,364 27.290 27,632 28,384 28,463 28,954 29,574 29,574 30,236 45 State...................................... 15,233 17,828 20,829 22,822 22,928 23,272 23,752 23,949 24,187 24,510 24,510 24,753 46 Loans outstanding.................. 24,432 28,169 34,384 38,201 38,657 39,711 40,573 40,865 41,427 42,055 42,055 42,331 47 Federal................................. 12.730 14,869 18,311 20,420 20,591 21,194 21,692 21,814 22,224 22,717 22,717 22,865 48 State.................................... 11,702 13,300 16,073 17,781 18,066 18,517 18,881 19,051 19,203 19,338 19,338 19,466 49 Savings.................................... 27,518 33,013 39,173 43,552 43,658 43,982 45,103 45,441 45,977 46,832 46,832 48,093 50 Federal (shares)................. 14,370 17,530 21,130 23,825 23,873 24,080 24,775 24,945 25,303 25,849 25,849 26,569 51 State (shares and deposits), 13,148 15,483 18,043 19,727 19,785 19,902 20,328 20,496 20,674 20,983 20,983 21,524 For notes see bottom of page A30. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A30 Domestic Financial Statistics □ April 1978 1.39 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Calendar year Transition Fiscal quarter Fiscal Type of account or operation year (July- year 1976 1977 1977 1978 1976 Sept. 1977 1976) H2 HI H2 Dec. Jan. Feb. U.S. Budget 1 Receipts 1............................................ 299,197 81,687 356,861 157.868 189,410 175,787 32,794 33,201 26,795 2 Outlays J,2,3...................................... r365,643 '94,657 *•401,902 -193,629 199,482 216,747 37,646 36,918 33,787 3 Surplus, or deficit (—)................... -66,446 -12,970 - 45,041 -35,761 -10,072 -40,961 -4,852 -3,717 -6,992 4 Trust funds...................................... 2,409 -1,952 7,833 -4,621 7,332 4,293 700 -3,946 2,850 5 Federal funds 4............................... -68,855 -11,018 '-52,874 -31,140 -17,405 -45,254 -5,552 230 -9,843 Off-budget entities surplus, or deficit (—) 6 Federal Financing Bank outlays... -5,915 -2,575 -8,415 -5,176 -2,075 -6,663 -1,462 -907 -1,084 7 Other2,5............................................... -1,355 793 -269 3,809 -2,086 428 59 -267 -209 U.S. Budget plus off-budget, in cluding Federal Financing Bank 8 Surplus, or deficit (—)....................... -73,716 r-14,752 r—53,725 -37,125 -14,233 -47,196 -6,255 -4,891 -8,285 Financed by: 9 Borrowing from the public 3. . .. 82,922 18,027 53,516 35,457 16,480 40,284 9,971 6,027 5,108 10 Cash and monetary assets (de crease, or increase ( —))......... -7,796 -2,899 -2,238 2,153 -4,666 4,317 -5,290 -229 5,171 11 Other 6.............................................. -1,396 -373 2,440 -485 2,420 2,597 1,573 -907 -1,993 Memo items : 12 Treasury operating balance (level, end of period)...................................... 14,836 17,418 19,104 11,670 16,255 12,274 12,274 12,481 7,391 13 F.R. Banks.......................................... 11,975 13,299 15,740 10,393 15,183 7,114 7,114 11,228 3,615 14 Tax and loan accounts...................... 2,854 4,119 3,364 1,277 1,072 5,160 5,160 1,253 3,776 15 Other demand accounts 7................. 7 1 Effective June 1977, earned income credit payments in excess of an Electrification; Telephone Revolving Fund, Rural Telephone Bank; and individual’s tax liability, formerly treated as outlays, are classified as Housing for the Elderly or Handicapped Fund until October 1978. income tax refunds retroactive to January 1976. 6 Includes public debt accrued interest payable to the public; deposit 2 Outlay totals reflect the reclassification of the Export-Import Bank, funds; miscellaneous liability (including checks outstanding) and asset and the Housing for the Elderly and Handicapped Fund effective October accounts; seignorage; increment on gold; net gain/loss for U.S. currency 1978, from off-budget status to unified budget status. valuation adjustment; net gain/loss for IMF valuation abjustment. 3 Export-Import Bank certificates of beneficial interest (effective July 7 Excludes the gold balance but includes deposits in certain commercial 1, 1975) and loans to the Private Export Funding Corp. (PEFCO), a wholly depositories that have been converted from a time deposit to a demand owned subsidiary of the Export-Import Bank, are treated as debt rather deposit basis to permit greater flexibility in Treasury cash management. than asset sales. 4 Half years calculated as a residual of total surplus/deficit and trust Source.—“Monthly Treasury Statement of Receipts and Outlays dx fund surplus/deficit. the U.S. Government,” Treasury Bulletin, and U.S. Budget, Fiscal Year 5 Includes Pension Benefit Guaranty Corp.; Postal Service Fund, Rural 1978. NOTES TO TABLE 1.38 1 Holdings of stock of the Federal home loan banks are included in Even when revised, data for current and preceding year are subject to “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 Calendar year Transition Fiscal quarter Fiscal Source or type year (July- year 1976 1977 1977 1978 1976 Sept. 1977 1976) H2 HI H2 Jan. Feb. Receipts 1 All sources 1........................................ 299,197 81,687 356,861 157,868 189,410 175,786 32,794 33,201 26,795 2 Individual income taxes, net........... 130,794 38,715 156,725 75,899 77,948 82,877 13,941 20,217 10,620 3 Withheld........................................ 123,408 32,949 144,820 68,023 73,303 75,480 13,351 13,111 12,811 4 Presidential Election Campaign Fund....................................... 34 1 37 1 37 1 1 6 5 Nonwithheld.................................. 35,528 6,809 42,062 8,426 32,959 9,397 770 7,154 905 6 Refunds 1....................................... 28,175 1,043 30,194 1,541 28,350 2,001 179 48 3,102 7 Corporation income taxes: 8 Gross receipts............................... 46,783 9,808 60,057 20,706 37,133 25,121 9,549 2,273 1,521 9 Refunds.......................................... 5,374 1,348 5,164 2,886 2,324 2,819 337 282 508 10 Social insurance taxes and contribu tions, net..................................... 92,714 25,760 108,683 47,596 58,099 52,347 6,647 7,997 12,427 11 Payroll employment taxes and contributions 2..................... 76,391 21,534 88,196 40,427 45,242 44,384 6,030 6,898 10,479 12 Self-employment taxes and contributions 3..................... 3,518 269 4,014 286 3,687 316 7 259 266 13 Unemployment insurance........... 8,054 2,698 11,312 4,379 6,575 4,936 123 403 1,192 14 Other net receipts 4..................... 4,752 1,259 5,162 2,504 2,595 2,711 486 437 490 15 Excise taxes........................................ 16,963 4,473 17,548 8,910 8,432 9,284 1,463 1,492 1,259 16 Customs.............................................. 4,074 1,212 5,150 2,361 2,519 2,848 501 494 441 17 Estate and gift.................................. 5,216 1,455 7,327 2,943 4,332 2,837 482 447 434 18 Miscellaneous receipts 5................. 8,026 1,612 6,536 3,236 3,269 3,292 549 563 602 Outlays9 19 All types i, 6........................................ 365,643 94,657 401,902 193,629 199,482 216,747 37,646 36,918 33,787 20 National defense................................. 89,430 22,307 97,501 45,002 48,721 50,873 8,417 7,974 8,676 21 International affairs 6....................... 5,567 2,180 4,831 3,028 2,522 2,896 371 300 -110 22 General science, space, and technology.................................... 4,370 1,161 4,677 2,377 2,108 2,318 382 370 392 23 Energy................................................... 3,127 794 4,172 319 24 Natural resources and environment 8,124 2,532 10,000 641 25 Agriculture........................................... 2,502 584 5,526 ‘'iioi^' “ '^628’ 5^477 i ,697 i j 790 * -57 26 Commerce and housing credit......... 3,795 1,391 -31 -626 27 Transportation.................................... 13,438 3,306 14,636 1,076 28 Community and regional development................................ 4,709 1,340 6,283 3,192 3,149 4,924 795 755 773 29 Education, training, employment, and social services..................... 18,737 5,162 20,985 9,083 9,775 10,800 1,778 1,996 2,058 30 Health................................................... 33,448 8,720 38,785 19,329 18,654 19,422 3,554 2,680 3,635 31 Income security 1............................... 126,598 32,710 137,004 65,367 69,917 71,047 12,105 12,912 12,073 32 Veterans benefits and services......... 18,432 3,962 18,038 8,542 9,382 9,864 2,613 686 1,529 33 Administration of justice.................. 3,320 859 3,600 1,839 1,783 1,723 293 307 326 34 General government.......................... 2,927 878 3,357 1,734 1,587 1,749 320 166 355 35 General-purpose fiscal assistance... 7,235 2,092 9,499 4,729 4,333 4,926 37 2,317 52 36 Interest 7.............................................. 34,589 7,246 38,092 18,409 18,927 19,962 6,236 2,628 3,353 37 Undistributed offsetting receipts 78 -14,704 -2,567 -15,053 -7,869 -6,803 -8,506 -4,063 -475 -677 1 Effective June 1977, earned income credit payments in excess of an Receipts” reflect the accounting conversion for the interest on special individual’s tax liability, formerly treated as outlays, are classified as in issues for U.S. Govt, accounts from an accrual basis to a cash basis. come tax refunds retroactive to January 1976. 8 Consists of interest received by trust funds, rents and royalties on 2 Old-age, disability and hospital insurance, and Railroad Retirement the Outer Continental Shelf, and U.S. Govt, contributions for em accounts. ployee retirement. 3 Old-age, disability, and hospital insurance. 9 For some types of outlays the categories are new or represent re 4 Supplementary medical insurance premiums, Federal employee re groupings; data for these categories are from the Budget of the United tirement contributions, and Civil Service retirement and disability fund. States Government, Fiscal Year 1979; data are not available for half years 5 Deposits of earnings by F.R. Banks and other miscellaneous receipts. or for months prior to February 1978. 6 Outlay totals reflect the reclassification of the Export-Import Bank Two categories have been renamed: “Law enforcement and justice” from off-budget status to unified budget status. Export-Import Bank has become “Administration of justice” and “Revenue sharing and certificates of beneficial interest (effective July 1, 1975) and loans to the general purpose fiscal assistance” has become “General purpose fiscal Private Export Funding Corp. (PEFCO), a wholly owned subsidiary of assistance.” the Export-Import Bank, are treated as debt rather than asset sales. In addition, for some categories the table includes revisions in figures 7 Effective September 1976, “Interest” and “Undistributed Offsetting published earlier. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A32 Domestic Financial Statistics □ April 1978 1.41 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars 1974 1975 1976 1977 Item Dec. 31 June 30 Dec. 31 June 30 Sept. 30 Dec. 31 June 30 Sept. 30 Dec. 31 1 Federal debt outstanding....................... 504.0 544.1 587.6 631.9 2 646.4 665.5 685.2 709.1 729.2' 2 Public debt securities.............................. 492.7 533.7 576.6 620.4 634.7 653.5 674.4 698.8 718.9 3 Held by public.................................... 351.5 387.9 437.3 470.8 488.6 506.4 523.2 543.4 564.1 ' 4 Held by agencies................................ 141.2 145.3 139.3 149.6 146.1 147.1 151.2 155.5 154.8 5 Agency securities..................................... 11.3 10.9 10.9 11.5 11.6 12.0 10.8 10.3 10.2 • 6 Held by public.................................... 9.3 9.0 8.9 9.5 29.7 10.0 9.0 8.5 8.4 7 Held by agencies................................ 2.0 1.9 2.0 2.0 1.9 1.9 1.8 1.8 1.8 8 Debt subject to statutory limit.............. 493.0 534.2 577.8 621.6 635.8 654.7 675.6 700.0 720.1 9 Public debt securities............................. 490.5 532.6 576.0 619.8 634.1 652.9 673.8 698.2 718.3 10 Other debt1.............................................. 2.4 1.6 1.7 1.7 1.7 1.7 1.7 1.7 1.7 11 Memo: Statutory debt limit................. 495.0 577.0 595.0 636.0 636.0 682.0 700.0 700.0 752.0 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 Note.—Data from Treasury Bulletin (U.S. Treasury Dept.). 1.42 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1977 1978 Type and holder 1973 1974 1975 1976 Nov. Dec. Jan. Feb. Mar. 1 Total gross public debt............................................. r469.1 492.7 576.6 653.5 708.0 718.9 721.6 729.8 738.0 By type: 2 Interest-bearing debt.................................................. 467.8 491.6 575.7 652.5 707.0 715.2 720.6 728.5 736.9 3 Marketable.............................................................. 270.2 282.9 363.2 421.3 454.9 459.9 466.8 470.8 478.3 4 Bills...................................................................... 107.8 119.7 157.5 164.0 156.7 161.1 161.2 161.8 165.7 5 124.6 129.8 167.1 216.7 251.1 251.8 257.1 258.5 262.2 6 Bonds................................................................... 37.8 33.4 38.6 40.6 47.1 47.0 48.5 50.5 50.4 7 197.6 208.7 212.5 231.2 252.1 255.3 253.8 257.7 258.7 9 8 State and local govt, series.................................. 2.3 * 2. . 3 6 2 1 . . 3 2 4 2 . . 5 3 1 2 2 . . 2 8 1 2 3 . .9 2 1 2 4 . . 2 8 1 2 5 . . 2 4 1 2 6 . . 2 4 10 Foreign issues3................................................... 26.0 22.8 21.6 22.3 21.7 22.2 22.8 22.6 23.6 11 Savings bonds and notes................................. 60.8 63.8 67.9 72.3 76.6 77.0 11A 77.8 78.2 12 108.0 119.1 119.4 129.7 138.6 139.8 136.4 139.4 138.0 13 Non-interest-bearing debt........................................ 1.2 1.1 1.0 1.1 1.0 3.7 1.0 1.3 1.0 By holder:5 14 U.S. Govt, agencies and trust funds................. 123.4 138.2 145. 3 149.6 153.9 154.8 151.5 15 F.R. Banks............................................................. 75.0 80.5 84.7 94.4 96.5 102.5 97.0 16 Private investors..................................................... 260.9 271.0 349.4 409.5 457.6 461.3 473.1 17 Commercial banks............................................ 60.3 55.6 85.1 103.8 101.4 102.4 102.2 18 Mutual savings banks...................................... 2.9 2. 5 4. 5 5.7 6.0 6.0 5.9 19 Insurance companies........................................ 6.4 6.2 9.5 12.5 15’ 3 15.6 15.3 20 Other corporations........................................... 10.9 11.0 20.2 26. 5 23 4 22.2 22.9 21 State and local governments.......................... 29.2 29.2 34.2 41.6 55.6 55.1 56.4 Individuals: 22 Savings bonds................................................ 60.3 63.4 67.3 72.0 76.4 76.7 77.1 23 Other securities.............................................. 16.9 21.5 24.0 28.8 28.5 28.6 29.0 24 Foreign and international6............................. 54.7 58.8 66.5 78.1 106.7 109.6 112.5 25 Other miscellaneous investors7...................... 19.3 22.8 38.0 40.5 44.2 45.0 51.7 1 Includes (not shown separately): Securities issued to the Rural 6 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 July 1974, the figures exclude positary bonds, retirement plan bonds, and individual retirement bonds. non-interest-bearing notes issued to the Interna ional Monetary Fund. 2 These nonmarketable bonds, also known as Investment Series B 7 Includes savings and loan associations, nonprofit institutions, cor Bonds, may be exchanged (or converted) at the owner’s option for 1 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, 3 Nonmarketable foreign government dollar-denominated and foreign beginning in July 1974, includes Federal Financing Bank security issues. currency denominated series. Data by type of security from Monthly Statement of the Public Debt of 4 Held only by U.S. Govt, agencies and trust funds. the United States (U.S. Treasury Dept.); data by holder from Treasury 5 Data for F.R. Banks and U.S. Govt, agencies and trust funds are Bulletin. actual holdings; data for other groups are Treasury estimates. 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 1978 1978 Type of holder 1976 1977 1976 1977 Jan. Feb. Jan. Feb. All maturities 1 to 5 years 1All holders................................................................................ 421,276 459,927 466,780 470,766 141,132 151,264 156,195 164,317 2 U.S. Govt, agencies and trust funds..................................... 16,485 14,420 14,403 13,996 6,141 4,788 4,788 A,119 3 96,971 101,191 97,004 98,450 31,249 27,012 27,715 28,824 307,820 344,315 355,374 358,320 103,742 119,464 123,692 130,715 5 78,262 75,363 73,965 74,761 40.005 38,691 39,254 40,583 6 Mutual savings banks......................................................... 4,072 4,379 4,279 4,251 2,010 2,112 2,121 2,218 7 10,284 12,378 12,165 12,146 3,885 A,129 4,679 5,126 8 14,193 9,474 9,965 9,297 2,618 3,183 3,345 3,430 9 4,576 4,817 4,942 4,954 2,360 2,368 2,396 2,438 10 State and local governments.............................................. 12,252 15,495 15,172 15,883 2.543 3,875 3,795 4,023 11 184,182 222,409 234,885 237,028 50,321 64,505 68,102 72,796 Total, within 1 year 5 to 10 years 12 All holders................................................................................ 211,035 230,691 231,175 228,805 43,045 45,328 45,319 41,554 13 U.S. Govt, agencies and trust funds..................................... 2,012 1,906 1,889 1,171 2.879 2,129 2,129 2,129 14 F. R. Banks.............................................................................. 51,569 56,702 51,645 52,438 9,148 10,404 10,477 9,571 15 Private investors....................................................................... 157,454 172,084 177,642 175,195 31,018 32,795 32,712 29,853 16 Commercial banks.............................................................. 31,213 29,477 27,207 26,553 6,278 6,162 6,280 6,149 17 1,214 1,400 1,291 1,233 567 584 578 507 18 2,191 2,398 2,216 2,096 2,546 3,204 3,246 2,906 19 11,009 5,770 5,910 5,239 370 307 421 299 20 1,984 2,236 2,334 2,313 155 143 140 130 21 State and local governments.............................................. 6,622 7,917 7,639 8,190 1,465 1,283 1,260 1,272 22 All others............................................................................. 103,220 122,885 131,045 129,572 19,637 21,112 20,788 18,589 Bills, within 1 year 10 to 20 years 23 All holders................................................................................ 163,992 161,081 161,221 161,817 11,865 12,906 14,371 14,356 24 U.S. Govt, agencies and trust funds..................................... 449 32 17 12 3,102 3,102 3,102 3,102 25 41,279 42,004 37,090 38,537 1,363 1,510 1,536 1,536 26 Private investors....................................................................... 122,264 119,035 124,115 123,269 7,400 8,295 9,733 9,719 27 Commercial banks.............................................................. 17,303 11,996 9,706 9,479 339 456 660 732 28 454 484 403 343 139 137 139 139 29 Insurance companies........................................................... 1,463 1,187 1,026 990 1,114 1,245 1,207 1,172 30 Nonfinancial corporations.................................................. 9,939 4,329 4,439 3,625 142 133 159 130 31 1.266 806 874 876 64 54 54 56 32 5,556 6,092 5,841 6,189 718 890 967 995 33 All others............................................................................. 86,282 94,152 101,826 101,766 4,884 5,380 6,547 6,494 Other, within 1 year Over 20 years 34 All holders................................................................................ 47,043 69,610 69,954 66,988 14,200 19,738 19,721 21,734 35 U.S. Govt, agencies and trust funds..................................... 1,563 1,874 1,872 1,159 2,350 2,495 2,494 2,814 36 F. R. Banks.............................................................................. 10,290 14,698 14,555 13,901 3,642 5,564 5,632 6,081 37 Private investors....................................................................... 35,190 53,039 53,527 51,927 8,208 11,679 11,595 12,838 38 Commercial banks.............................................................. 13,910 15,482 17,501 17,074 427 578 564 744 39 Mutual savings banks.......................................................... 760 916 888 890 143 146 150 153 40 Insurance companies........................................................... 728 1,211 1,190 1,106 548 802 818 844 41 Nonfinancial corporations.................................................. 1,070 1,441 1,471 1,613 55 81 131 99 42 Savings and loan associations............................................ 718 1,430 1,460 1,437 13 16 17 17 43 State and local governments.............................................. 1,066 3,875 3,795 2,001 904 1,530 1,511 1,404 44 All others............................................................................. 16,938 28,733 29,219 27,806 6,120 8,526 8,403 9,576 Note.—Direct public issues only. Based on Treasury Survey of Owner banks, 465 mutual savings banks, and 728 insurance companies, each ship from Treasury Bulletin (U.S. Treasury Dept.). about 90 per cent; (2) 436 nonfinancial corporations and 485 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) 496 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 Feb. 28, 1978; (1) 5,486 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 □ April 1978 1.44 U.S. GOVERNMENT SECURITIES DEALERS Transactions Par value; averages of daily figures, in millions of dollars 1977 1978 1978, week ending Wednesday— 1974 1975 1976 Dec. Jan. Feb Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. 1 Mar. 8 1 U.S. Govt, securities. 3,579 6,027 10,449 9,303 10,740 10,200 9,721 8,557 9,440 10,854 11,895 10,463 By maturity: Bills. 2,550 3,889 6,676 5,834 6,956 5,835 5,775 r5,038 5,259 6,216 6,833 7,244 Other within 1 year. 250 223 210 264 400 317 440 180 303 276 503 328 1-5 years.................... 465 1,414 2,317 1,865 1,923 2,240 2,245 1,541 1,880 2,484 2,911 1,736 5-10 years................. 256 363 1,019 729 720 1,169 751 1,144 1,295 1,277 1,007 670 Over 10 years........... 58 138 229 611 741 640 510 654 704 602 641 486 By type of customer: U.S. Govt, securities dealers.................. 652 885 1,360 1,317 1,358 1,509 1,278 1,252 1,375 1,504 1,835 1,400 U.S. Govt, securities brokers................. 965 1,750 3,407 2,818 3,663 2,962 3,030 2,426 2,763 3,220 3,578 3,069 Commercial banks... 998 1,451 2,426 1,756 2,180 2,069 2,056 1,671 1,898 2,417 2,248 2,125 All others1................... 964 1,941 3,257 3,412 3,540 3,661 3,358 r3,207 3,405 3,713 4,234 3,869 11 Federal agency securities.... 965 1,043 1,548 1,444 1,460 1,668 1,567 982 1,181 2,174 2,697 1,783 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, week ending 1978, week ending 1977 1978 Wednesday— ■ Wednesday— 1974 1975 1976 Dec. Jan. Feb. Jan. 11 Jan. 18 Jan. 25 Feb. 1 Feb. 8 Feb. 15 Positions2 2,580 5,884 7,592 5,114 4,373 4,845 6,009 3,385 3,605 4,083 5,728 5,457 2 Bills........................................ 1,932 4,297 6,290 4,312 4,052 3,351 5,639 3,613 3,240 3,401 3,682 4,193 3 Other within 1 year........... -6 265 188 210 91 68 147 76 65 92 165 86 4 1-5 years.............................. 265 886 515 377 120 792 2 -389 332 579 744 358 5 5-10 years............................ 302 300 402 66 -117 387 -96 -146 -156 -106 725 495 6 Over 10 years...................... 88 136 198 147 227 248 315 230 124 118 412 325 7 Federal agency securities 1,212 943 729 788 504 622 524 387 448 611 576 619 Sources of financing3 8 All sources................................ 3,977 6,666 8,715 11,429 9,976 9,695 11,924 9,421 9,153 9,339 9,197 10,558 Commercial banks: 1,032 1,621 1,896 1,255 926 533 1,257 639 977 591 857 458 10 Outside New York City... 1,064 1,466 1,660 2,246 2,342 2,377 3,109 2,483 1,960 2,067 2,396 2,644 11 Corporations1......................... 459 842 1,479 2,839 2,492 2,299 2,881 2,626 2,335 2,109 2,134 2,303 12 All others................................ 1,423 2,738 3,681 5,090 4,216 4,485 4,676 3,673 3,881 4,572 3,810 5,153 1 All 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 1977 1978 Agency 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan. 1 Federal and Federally sponsored agencies............ 89,381 97,680 103,325 107,868 108,379 109,046 109,427 110,409 111,520 2 Federal agencies.................................................... 12,719 19,046 21,896 22,322 23,055 23,143 23,257 23,245 23,293 3 Defense Department1.......................................... 1,312 1,220 1,113 1,024 1,016 1,006 991 983 974 4 Export-Import Bank2,3........................................ 2,893 7,188 7,801 8,742 9,246 9,246 9,246 9,156 9,156 5 Federal Housing Administration4..................... 440 564 575 579 579 583 585 581 599 6 Government National Mortgage Association participation certificates5............................ 4,280 4,200 4,120 3,768 3,768 3,768 3,768 3,743 3,743 7 Postal Service 6....................................................... 721 1,750 2,998 2,431 2,431 2,431 2,431 2,431 2,431 8 Tennessee Valley Authority................................ 3,070 3,915 5,185 5,490 5,705 5,785 5,905 6,015 6,045 3 209 104 288 310 324 331 336 345 10 Federally sponsored agencies................................. 76,662 78,634 81,429 85,546 85,324 85,903 86,170 87,164 88,227 11 Federal home loan banks.................................... 21,890 18,900 16,811 17,196 17,162 17,325 17,867 18,345 18,692 12 Federal Home Loan Mortgage Corporation.. 1,551 1,550 1,690 1,686 1,686 1,686 1,686 1,686 1,768 13 Federal National Mortgage Association......... 28,167 29,963 30,565 31,301 31,491 31,572 31,333 31,890 32,024 14 Federal land banks............................................... 12,653 15,000 17,127 18,719 18,719 19,118 19,118 19,118 19,498 15 Federal intermediate credit banks..................... 8,589 9,254 10,494 11,786 11,693 11,623 11,421 11,174 11,103 16 Banks for cooperatives......................................... 3,589 3,655 4,330 4,356 4,061 4,052 4,208 4,434 4,625 17 Student Loan Marketing Association7............. 220 310 410 500 510 525 535 515 515 18 Other........................................................................ 3 2 2 2 2 2 2 2 2 Memo items: 4,474 17,154 28,711 33,800 35,418 36,722 37,095 38,580 39,522 Lending to Federal and Federally sponsored agencies: 20 Export-Import Bank3.......................................... 4,595 5,208 5,420 5,924 5,924 5,924 5,834 5,834 21 Postal Service®....................................................... 500 1,500 2,748 2,181 2,181 2,181 2,181 2,181 2,181 22 Student Loan Marketing Association7............. 220 310 410 500 510 525 535 515 515 23 Tennessee Valley Authority................................ 895 1,840 3,110 3,665 3,880 3,960 4,080 4,190 4,220 24 United States Railway Association6................. 3 209 104 288 310 324 331 336 345 Other lending:9 25 Farmers Home Administration......................... 2,500 7,000 10,750 14,465 14,615 15,295 15,295 16,095 16,760 26 Rural Electrification Administration................ 566 1,415 2,184 2,382 2,467 2,535 2,647 2,809 27 Other........................................................................ 356 1,134 4,966 5,097 5,616 6,046 6,214 6,782 6,858 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 □ April 1978 1.47 NEW SECURITY ISSUES State and Local Government and Corporate Millions of dollars 1977 Type of issue or issuer, 1975 1976 1977 or use July Aug. Sept. Oct. Nov. Dec. State and local government 30,607 35,313 46,769 3,116 4,121 4,022 3,816 3,338 3,655 By type of issue: 16,020 18,040 18,042 1,038 1,189 1,267 1,521 982 1,372 14,511 17,140 28,655 2,075 2,929 2,746 2,286 2,350 2,274 76 133 72 3 3 9 9 6 9 By type of issuer: 7,438 7,054 6,354 166 397 401 837 299 517 7 Special district and statutory authority.............................. 12,441 15,304 21,717 1,732 2,308 2,364 1,607 1,592 1,846 8 Municipalities, counties, townships, school districts.... 10,660 12,845 18,623 1,215 1,413 1,247 1,363 1,441 1,283 29,495 32,108 36,189 2,539 2,813 2,376 3,082 2,514 2,343 By use of proceeds: 4,689 4,900 5,076 344 350 356 352 381 348 2,208 2,586 2,951 140 220 176 327 113 184 7,209 9,594 8,119 914 442 659 402 474 525 4,392 6,566 8,274 496 773 672 1,069 691 659 445 483 4,676 233 455 313 455 589 282 10,552 7,979 7,093 412 573 200 All 266 345 Corporate 53,619 53,356 50,863 4,074 3,322 r3,754 '3,957 5,120 5,479 17 Bonds............................................................................................... 42,756 42,262 39,673 3,379 2,765 r3,128 '3,023 3,274 4,708 By type of offering: 18 Public.......................................................................................... 32,583 26,453 24,185 2,360 1,947 *■1,908 '2,114 2,211 1,541 10,172 15,808 15,488 1,019 818 1,220 909 1,063 3,167 By industry group: 16,980 13,243 10,600 1,165 932 513 623 688 1,467 2,750 4,361 5,550 526 380 623 521 517 785 3,439 4,357 1,874 143 241 131 113 150 318 23 Public utility ............................................................................. 9,658 8,297 8,005 480 347 1,014 854 836 454 3,464 2,787 3,174 258 45 319 8 285 122 6,469 9,222 10,471 807 819 *•528 '904 798 1,563 10,863 11,094 11,190 695 557 626 934 1,846 1,041 By type: 27 Preferred.................................................................................... 3,458 2,789 3,344 327 178 347 299 290 445 7,405 8,305 7,846 368 379 279 635 1,556 596 By industry group: 1,670 2,237 1,265 144 34 38 83 56 166 30 Commercial and miscellaneous............................................ 1,470 1,183 1,813 66 94 86 325 97 124 31 T ransportation.......................................................................... 1 24 418 100 40 50 32 Public utility ............................................................................. 6,235 6,101 5,567 363 150 403 395 829 576 33 Communication........................................................................ 1,002 776 1 179 19 45 •x 725 110 34 Real estate and financial........................................................ 488 771 ’948 3 279 55 131 88 65 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 p n r it 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 i m nc 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 1 New issues................................................................... 39,344 53,255 53,123 15,602 9,079 13,363 13,671 14,229 11,385 13,838 2 Retirements.................................................................. 9,935 10,991 12,184 3,211 2,576 3.116 2,315 3,668 2,478 3,723 3 Net change................................................................... 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 5 Retirements................................................................. 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 Transportation, including railroad..................... 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 Communication...................................................... 3,499 2,980 1,687 810 472 429 498 953 335 -99 12 Real estate and financial...................................... 5,428 4,682 7,054 852 866 1,222 1,530 2,128 1,178 2,218 Common and preferred stock 13 New issues................................................................... 7,980 12,787 14,129 4,142 2,425 3,768 4,267 3,985 2,684 3,193 14 Retirements................................................................. 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 1977 1978 Item 1976 1977 Aug. Sept. Oct. Nov. Dec. Jan. Feb. INVESTMENT COMPANIES excluding money market funds 1 Sales of own shares1............................................ 4,226 6,401 501 558 542 511 557 638 451 2 Redemptions of own shares2............................ 6,802 6,027 493 469 519 430 562 465 348 3 Net sales................................................................. -2,496 357 8 89 23 81 5 173 103 4 Assets3.................................................................... 47,537 45,049 45,038 45,046 43,435 45,050 45,049 43,000 42,879 5 Cash position4.................................................. 2,747 3,274 3,135 3,403 3,481 3,487 3,274 3,608 4,258 6 Other................................................................... 44,790 41,775 41,903 41,643 39,954 41,563 41,775 39,392 38,621 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 □ April 1978 1.50 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1976 1977 Account 1975 1976 1977 Q2 Q3 Q4 Ql Q2 Q3 Q4» 1 Profits before tax.......................................................... 123.5 156.9 171.6 159.2 159.9 154.8 161.7 174.0 172.8 178.0 2 Profits tax liability........................................................ 50.2 64.7 69.1 66.1 65.9 63.9 64.4 69.7 69.3 73.2 3 Profits after tax............................................................. 73.3 92.2 102.5 93.1 94.0 90.9 97.3 104.3 103.5 104.8 4 Dividends........................................................................ 32.4 35.8 41.2 35.0 36.0 38.4 38.5 40.3 42.3 43.6 5 Undistributed profits................................................... 40.9 56.4 61.3 58.1 58.0 52.5 58.8 64.0 61.2 61.2 6 Capital consumption allowances............................... 89.5 97.2 104.7 95.9 98.2 100.4 102.0 103.5 105.8 107.6 7 Net cash flow................................................................. 130.4 153.6 166.0 154.0 156.2 152.9 160.8 167.5 167.0 168.8 Source.—Survey of Current Business (U S. Dept, of Commerce). 1.51 NONFINANCIAL CORPORATIONS Current Assets and Liabilities Billions of dollars, end of period 1976 1977 Account 1972 1973 1974 1975 Q2 Q3 Q4 Ql Q2 Q3 1 Current assets.............................................................. 574.4 643.2 712.2 731.6 775.4 791.8 816.8 845.3 874.7 909.8 2 Cash.......................................................................... 57.5 61.6 62.7 68.1 70.8 71.1 77.0 75.0 77.9 79.1 3 U.S. Govt, securities............................................. 10.2 11.0 11.7 19.4 23.3 23.9 26.4 27.3 24.1 24.1 4 243.4 269.6 293.2 298.2 321.8 328.5 328.2 346.6 361.4 379.1 5 U.S. Govt.1........................................................ 3.4 3.5 3.5 3.6 3.7 4.3 4.3 4.7 4.8 5.3 6 Other..................................................................... 240.0 266.1 289.7 294.6 318.1 324.2 323.9 342.0 356.6 373.8 7 215.2 246.7 288.0 285.8 295.6 302.1 315.4 322.1 332.5 343.1 8 Other......................................................................... 48.1 54.4 56.6 60.0 63.9 66.3 69.8 74.3 78.8 84.5 9 Current liabilities......................................................... 352.2 401.0 450.6 457.5 475.9 484.1 499.9 516.6 532.0 556.3 10 Notes and accounts payable............................... 234.4 265.9 292.7 288.0 293.8 291.7 302.9 309.0 318.9 329.7 11 U.S. Govt.1......................................................... 4.0 4.3 5.2 6.4 6.8 7.0 7.0 6.8 5.7 6.2 12 Other..................................................................... 230.4 261.6 287.5 281.6 287.0 284.7 295.9 302.2 313.2 323.5 13 Accrued Federal income taxes............................ 15.1 18.1 23.2 20.7 22.0 24.9 26.8 28.6 24.5 26.9 14 Other......................................................................... 102.6 117.0 134.8 148.8 160.1 167.5 170.2 179.0 188.6 199.7 222.2 242.3 261.5 274.1 299.5 307.7 316.9 328.7 342.8 353.5 1 Receivables from, and payables to, the U.S. Govt, exclude amounts Source.—Securities and Exchange Commission, offset against each other on corporations’ books. 1.52 BUSINESS EXPENDITURES on New Plant and Equipment Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1976 1977 1978 Industry 1976 1977 Q2 Q3 Q4 Ql Q2 Q3 Q4 Q12 120.82 136.79 118.12 122.55 125.22 130.16 134.24 140.38 142.38 146.26 Manufacturing 2 Durable goods industries...................................... 23.50 28.17 22.54 24.59 25.50 26.30 27.26 29.23 29.88 30.46 3 Nondurable goods industries.............................. 29.22 32.66 28.09 30.20 28.93 30.13 32.19 33.79 34.54 33.68 Nonmanufacturing 4 Mining...................................................................... 3.98 4.44 3.83 4.21 4.13 4.24 4.49 4.74 4.30 4.61 Transportation: 5 Railroad............................................................... 2.35 2.92 2.64 2.69 2.63 2.71 2.57 3.20 3.18 3.80 6 Air......................................................................... 1.31 1.69 1.44 1.12 1.41 1.62 1.43 1.69 2.01 2.39 7 Other..................................................................... 3.56 2.47 4.16 3.44 3.49 2.96 2.96 1.96 1.98 1.83 Public utilities: 8 Electric................................................................. 18.90 21.71 18.82 18.22 19.49 21.19 21.14 21.90 22.60 23.81 9 Gas and other..................................................... 3.47 4.36 3.03 3.45 3.96 4.16 4.16 4.32 4.81 4.91 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 . . 8 9 7 3 2 1 2 5 . . 8 3 5 0 2 1 0 2 . . 9 6 4 2 2 1 0 3 . . 9 6 9 4 2 1 1 4 . . 3 3 6 0 2 1 2 4 . . 6 1 7 9 2 1 2 5 . . 7 3 3 2 2 1 3 6 . . 1 4 4 0 } 39.09 40.76 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.—Survey of Current Business (U.S. Dept, of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Corporate Finance A39 1.521 DOMESTIC FINANCE COMPANIES Assets and Liabilities Billions of dollars, end of period 1976 1977 Account 1972 1973 1974 1975 Q3 Q4 Ql Q2 Q3 Q4 ASSETS Accounts receivable, gross 1 Consumer........................................................... 31.9 35.4 36.1 36.0 37.6 38.6 39.2 40.7 42.3 44.0 2 Business.............................................................. 27.4 32.3 37.2 39.3 42.4 44.7 47.5 50.4 50.6 55.2 3 Total................................................................ 59.3 67.7 73.3 75.3 80.0 83.4 86.7 91.2 92.9 99.2 4 Less: Reserves for unearned income and losses 7.4 8.4 9.0 9.4 10.2 10.5 10.6 11.1 11.7 12.7 5 Accounts receivable, net....................................... 51.9 59.3 64.2 65.9 69.9 72.9 76.1 80.1 81.2 86.5 6 Cash and bank deposits........................................ 2.8 2.6 3.0 2.9 2.6 2.6 2.7 2.5 2.5 2.6 7 Securities................................................................. .9 .8 .4 1.0 1.2 1.1 1.0 1.2 1.8 .9 8 All other.................................................................. 10.0 10.6 12.0 11.8 12.7 12.6 13.0 13.7 14.2 14.3 9 Total assets............................................................. 65.6 73.2 79.6 81.6 86.4 89.2 92.8 97.5 99.6 104.3 LIABILITIES 10 Bank loans.............................................................. 5.6 7.2 9.7 8.0 5.5 6.3 6.1 5.7 5.4 5.9 11 Commercial paper.................................................. 17.3 19.7 20.7 22.2 21.7 23.7 24.8 27.5 25.7 29.6 Debt: 12 Short-term, n.e.c................................................ 4.3 4.6 4.9 4.5 5.2 5.4 4.5 5.5 5.4 6.2 13 Long-term, n.e.c................................................. 22.7 24.6 26.5 27.6 31.0 32.3 34.0 35.0 34.8 36.0 14 Other................................................................... 4.8 5.6 5.5 6.8 9.5 8.1 9.5 9.4 13.7 11.5 15 Capital, surplus, and undivided profits................ 10.9 11.5 12.4 12.5 13.4 13.4 13.9 14.4 14.6 15.1 16 Total liabilities and capital.................................... 65.6 73.2 79.6 81.6 86.4 89.2 92.8 97.5 99.6 104.3 Note.—Components may not add to totals due to rounding. 1.522 DOMESTIC FINANCE COMPANIES Business Credit Millions of dollars, seasonally adjusted except as noted Changes in accounts Extensions Repayments Accounts receivable during— receivable Type outstand ing Jan. 31, 1977 1978 1977 1978 1977 1978 19781 Nov. Dec. Jan. Nov. Dec. Jan. Nov. Dec. Jan. 1 Total.................................................................. 55,631 499 906 777 12,655 13,386 12,707 12,156 12,480 11,930 2 Retail automotive (commercial vehicles)....... 12,098 146 332 161 961 1,156 1,023 815 824 862 3 Wholesale automotive..................................... 12,218 -96 294 285 5,104 5,731 5,141 5,200 5,437 4,856 4 Retail paper on business, industrial, and farm equipment........................................ 14,706 357 96 311 1,176 1,003 1,004 819 907 693 5 Loans on commercial accounts receivable... 3,812 16 53 -35 2,428 2,334 2,411 2,412 2,281 2,446 6 Factored commercial accounts receivable.... 2,135 15 -43 -7 1,466 1,599 1,591 1,451 1,642 1,598 7 All other business credit................................. 10,662 61 174 62 1,520 1,563 1,537 1,459 1,389 1,475 1 Not seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A40 Domestic Financial Statistics □ April 1978 1.53 MORTGAGE MARKETS Millions of dollars; exceptions noted. 1977 1978 Item 1975 1976 1977 Sept. Oct. Nov. Dec. Jan. Feb. Terms and yields in primary and secondary markets PRIMARY MARKETS Conventional mortgages on new homes Terms:1 1 Purchase price (thous. dollars)....................... 44.6 48.4 54.3 56.0 54.0 56.4 57.7 58.0 58.4 2 Amount of loan (thous. dollars)................... 33.3 35.9 40.5 41.7 40.2 42.0 42.6 43.3 43.5 3 Loan/price ratio (per cent).............................. 74.7 74.2 76.3 76.3 76.1 76.5 75.5 76.4 76.4 4 Maturity (years)...........T................................... 26.8 27.2 27.9 28.2 27.6 28.2 28.0 28.3 27.4 5 Fees and charges (per cent of loan amount)2. 1.54 1.44 1.33 1.34 1.35 1.38 1.32 1.41 1.34 6 Contract rate (per cent per annum)............. 8.75 8.76 8.80 8.82 8.84 8.85 8.87 8.93 8.96 Yield (per cent per annum): 7 FHLBB series 3................................................... 9.01 8.99 9.01 9.04 9.07 9.07 9.09 9.15 9.18 8 HUD series4....................................................... 9.10 8.99 8.95 9.00 9.00 9.05 9.10 *•9.15 9.25 SECONDARY MARKETS Yields (per cent per annum) on— 9 FHA mortgages (HUD series)5..................... 9.19 8.82 7.96 8.72 8.78 8.78 8.91 9.11 8.52 8.17 8.04 8.03 8.16 8.19 8.29 8.56 8.64 FNMA auctions:7 11 Government-underwritten loans............... 9.26 8.99 8.73 8.74 8.74 8.85 8.94 9.17 9.31 12 Conventional loans...................................... 9.37 9.11 8.98 9.05 9.05 9.16 9.19 9.32 9.49 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 13 Total.......................................................................... 31,824 32,904 34,370 34,149 34,123 34,192 34,370 34,756 35,408 19,732 18,916 18,457 18,704 18,602 18,535 18,457 18,500 18,664 15 VA-guaranteed................................................... 9,573 9,212 9,315 "9,344 9,287 9,267 9,315 9,398 9,599 2,519 4,776 6,597 6,100 6,234 6,389 6,597 6,858 7,146 Mortgage transactions (during period) 17 Purchases................................................................. 4,263 3,606 4,780 385 251 352 497 636 879 18 Sales.......................................................................... 2 86 67 5 Mortgage commitments:8 19 Contracted (during period)................................ 6,106 6,247 9,729 364 897 975 1,333 1,810 1,942 20 Outstanding (end of period)................................ 4,126 3,398 4,698 3,522 3,702 4,192 4,698 5,781 6,851 Auction of 4-month commitments to buy— Government-underwritten loans: 21 Offered 9............................................................... 7,042.6 4,929.8 7,974.1 112.9 613.2 105.2 *•1,184.5 1,779.8 1,199.1 22 Accepted............................................................. 3,848.3 2,787.2 4,846.2 75.4 400.5 r152.7 *-794.0 970.9 623.1 Conventional loans: 23 Offered 9............................................................... 1,401.3 2,595.7 5,675.2 246.4 758.1 r537.6 *•591.6 949.9 1,214.1 765.0 1,879.2 3,917.8 184.4 529.0 *•386.3 *•359.4 449.6 566.0 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period)10 25 Total......................................................................... 4,987 4,269 3,276 3,376 3,402 3,266 3,276 3,163 3,044 26 FHA/VA............................................................. 1,824 1,618 1,395 1,443 1,424 1,406 1,395 1,382 1,381 27 Conventional...................................................... 3,163 2,651 1,881 1,933 1,978 1,860 1,881 1,782 1,663 Mortgage transactions (during period) 1,716 1,175 3,900 479 428 576 489 401 363 1,020 1,396 4,131 386 354 677 477 503 470 Mortgage commitments:11 982 1,477 5,546 547 465 574 361 367 363 31 Outstanding (end of period)............................... 111 333 1,063 1,353 1,329 1.233 1,063 *•961 1,021 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. I o Includes participations as well as whole loans. 6 Average net yields to investors on Government National Mortgage II 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
Real Estate Debt A41 1.54 MORTGAGE DEBT OUTSTANDING Millions of dollars, end of period 1977 Type of holder, and type of property 1973 1974 1975 1976 Ql Q2 Q3 Q4 p 1All holders.................................................. 682,321 742,512 801,537 889,327 912,582 948,959 985,695 1,019,688 2 1- to 4-family........................................ 416,211 449,371 490,761 556,557 573,861 600,370 626,628 650,397 1 Multifamily........................................... 93,132 99,976 100,601 104,516 105,309 107,106 109,052 111,450 4 Commercial........................................... 131,725 146,877 159,298 171,223 174,257 179,591 185,935 192,093 5 Farm...................................................... 41,253 46,288 50,877 57,031 59,155 61,892 64,080 65,748 6 Maior financial institutions....................... 505,400 542,560 581,193 647,650 663,210 690,473 717,502 741,544 7 Commercial banks1............................... 119,068 132,105 136,186 151,326 155,448 162,778 170,378 176,678 8 1- to 4-family.................................... 67,998 74,758 77,018 86,234 88,886 93,393 97,746 101,361 9 Multifamily........................................ 6,932 7,619 5,915 8,082 7,974 8,003 8,383 8,692 10 Commercial....................................... 38,696 43,679 46,882 50,289 51,624 54,038 56,565 58,657 11 Farm.................................................. 5,442 6,049 6,371 6,721 6,964 7,344 7,684 7,968 12 Mutual savings banks............................ 73,230 74,920 77,249 81,639 82,273 84,076 86,079 87,960 13 1- to 4-family..................................... 48,811 49,213 50,025 53,089 53,502 55,000 56,313 57,543 14 Multifamily........................................ 12,343 12,923 13,792 14,177 14,291 14,602 14,952 15,279 15 Commercial....................................... 12,012 12,722 13,373 14,313 14,422 14,422 14,762 15,085 16 64 62 59 60 58 52 52 53 17 Savings and loan associations............... 231,733 249,301 278,590 323,130 333,703 350,765 366,975 381,246 18 1- to 4-family.................................... 187,078 200,987 223,903 260,895 269,932 284,541 296,846 308,390 19 Multifamily........................................ 22,779 23,808 25,547 28,436 29,199 30,517 32,110 33,359 20 Commercial....................................... 21,876 24,506 29,140 33,799 34,572 35,707 38,019 39,497 21 81,369 86,234 89,168 91,555 91,786 92,854 94,070 95,660 22 1- to 4-family..................................... 20,426 19,026 17,590 16,088 15,699 15,418 15,022 14,722 23 Multifamily........................................ 18,451 19,625 19,629 19,178 18,921 18,891 18,831 18,881 24 Commercial....................................... 36,496 41 ,256 45,196 48,864 49,526 50,405 51,742 53,438 25 Farm.................................................. 5,996 6,327 6,753 7,425 7,640 8,140 8,475 8,619 26 Federal and related agencies.................... 46,721 58,320 66,891 66,753 66,065 68,338 69,068 70,175 27 Government National Mortgage Assn... 4,029 4,846 7,438 4,241 4,013 3,912 3,599 3,636 28 1- to 4-family..................................... 1,455 2,248 4,728 1,970 1,670 1,654 1,522 1,538 29 2,574 2,598 2,710 2,271 2,343 2,258 2,077 2,098 30 Farmers Home Admin........................... 1,366 1,432 1,109 1,064 500 1,043 1,292 1,467 31 1- to 4-family.................................... 743 759 208 454 98 410 548 622 32 Multifamily........................................ 29 167 215 218 28 97 192 218 33 218 156 190 72 64 126 142 162 34 376 350 496 320 310 410 410 465 35 Federal Housing and Veterans Admin... 3,476 4,015 4,970 5,150 5,223 5,259 5,130 5,291 36 1- to 4-family..................................... 2,013 2,009 1 ,990 1,676 1,730 1,711 1,566 1,706 37 Multifamily........................................ 1 ,463 2,006 2,980 3,474 3,493 3,548 3,564 3,585 38 Federal National Mortgage Assn.......... 24,175 29,578 31,824 32,904 32,830 33,918 34,148 34,369 39 1- to 4-family..................................... 20,370 23,778 25,813 26,934 26,836 27,933 28,178 28,504 40 Multifamily........................................ 3,805 5,800 6,011 5,970 5,994 5,985 5,970 5,865 41 11,071 13,863 16,563 19,125 19,942 20,818 21,523 22,136 42 1- to 4-family..................................... 123 406 549 601 611 628 649 670 43 Farm.................................................. 10,948 13,457 16,014 18,524 19,331 20,190 20,874 21,466 44 Federal Home Loan Mortgage Corp.... 2,604 4,586 4,987 4,269 3,557 3,388 3,376 3,276 45 1- to 4-family..................................... 2,446 4,217 4,588 3,889 3,200 2,901 2,818 2,738 46 Multifamily........................................ 158 369 399 380 357 487 558 538 47 Mortgage pools or trusts2......................... 18,040 23,799 34,138 49,801 55,462 58,748 64,667 70,202 48 Government National Mortgage Assn... 7,890 11,769 18,257 30,572 34,260 36,573 41,089 44,896 49 1- to 4-family..................................... 7,561 11,249 17,538 29,583 33,190 35,467 39,865 43,555 50 Multifamily........................................ 329 520 719 989 1,070 1,106 1,224 1,341 51 Federal Home Loan Mortgage Corp... 766 757 1,598 2,671 3,570 4,460 5,332 6,610 52 1- to 4-family..................................... 617 608 1,349 2,282 3,112 3,938 4,642 5,621 53 Multifamily........................................ 149 149 249 389 458 522 690 989 54 Farmers Home Admin........................... 9,384 11,273 14,283 16,558 17,632 17,715 18,426 18,696 55 1- to 4-family..................................... 5,458 6,782 9,194 10,219 10,821 10,814 11,127 11,379 56 Multifamily........................................ 138 116 295 532 786 111 768 779 57 Commercial....................................... 1 ,124 1,473 1,948 2,440 2,570 2,680 2,824 2,963 58 Farm.................................................. 2,664 2,902 2,846 3,367 3,455 3,444 3,527 3,575 59 Individuals and others3............................. 112,160 117,833 119,315 125,123 127,845 131,400 134,458 137,767 60 1- to 4-family..................................... 51 ,112 53,331 56,268 62,643 64,574 66,592 69,786 72,048 61 Multifamily........................................ 23,982 24,276 22,140 20,420 20,395 20,313 19,733 19,826 62 Commercial....................................... 21,303 23,085 22,569 21,446 21,479 22,213 21,881 22,291 63 Farm.................................................. 15,763 17,141 18,338 20,614 21,397 22,312 23,068 23,602 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 □ April 1978 1.55 CONSUMER INSTALMENT CREDIT Total Outstanding, and Net Change Millions of dollars 1977 1978 Holder, and type of credit 1975 1976 1977 Aug. Sept. Oct. Nov. Dec. Jan. Feb. Amounts outstanding (end of period) 1 164,955 185,489 216,572 204,358 207,294 209,141 212,074 216,572 215,925 216,297 By holder: 2 78,667 89,511 105,291 100,059 101,564 102,504 103,469 105,291 105,466 105,663 3 35,994 38,639 44,015 41,987 42,333 42,704 43,322 44,015 43,970 44,107 4 Credit unions................................... 25,666 30,546 37,036 35,077 35,779 35,993 36,488 37,036 36,851 37,217 5 18,002 19,052 21,082 18,475 18,725 18,961 19,629 21,082 20,525 20,060 6 6,626 7,741 9,149 8,760 8,894 8,978 9,166 9,149 9,114 9,250 By type of credit: 7 55,879 66,116 79,352 76,027 77,207 77,845 78,757 79,352 79,376 79,984 8 31,553 37,984 46,119 44,262 44,933 45,399 45,845 46,119 46,247 46,547 9 18,353 21,176 25,370 24,277 24,717 24,972 25,228 25,370 25,476 25,696 10 13,200 16,808 20,749 19,985 20,216 20,427 20,616 20,749 20,771 20,851 11 11,155 12,489 14,263 13,783 13,930 13,998 14,205 14,263 14,260 14,374 12 12,741 15,163 18,385 17,412 17,761 17,867 18,113 18,385 18,293 18,475 13 Others........................................... 430 480 585 570 584 581 594 585 576 588 14 Mobile homes................................... 14,423 14,572 15,014 14,812 14,880 14,929 14,999 15,014 14,978 14,973 15 Commercial banks...................... 8,649 8,734 8,862 8,794 8,828 8,839 8,856 8,862 8,819 8,807 16 Finance companies..................... 3,451 3,273 3,109 3,114 3,119 3,116 3,123 3,109 3,115 3,098 17 Home improvement.......................... 9,405 10,990 12,952 12,329 12,532 12,703 12,879 12,952 12,904 12,968 18 Commercial banks...................... 4,965 5,554 6,473 6,158 6,265 6,377 6,447 6,473 6,445 6,436 Revolving credit: 19 Bank credit cards........................ 9,501 11,351 14,262 12,227 12,651 12,829 13,096 14,262 14,369 14,174 20 Bank check credit....................... 2,810 3,041 3,724 3,409 3,504 3,551 3,601 3,724 3,776 3,822 21 72,937 79,418 91,269 85,554 86,519 87,283 88,743 91,269 90,522 90,376 22 Commercial banks, total............ 21,188 22,847 25,850 25,209 25,383 25,510 25,626 25,850 25,809 25,877 23 Personal loans......................... 14,629 15,669 17,740 17,238 17,373 17,452 17,555 17,740 17,708 17,769 24 Finance companies, total............ 21,238 22,749 26,498 24,951 25,143 25,448 25,850 26,498 26,452 26,489 25 Personal loans......................... 17,263 18,554 21,302 20,118 20,256 20,498 20,852 21,302 21,248 21,283 26 Credit unions............................... 10,754 12,799 15,518 14,697 14,991 15,081 15,289 15,518 15,440 15,594 27 Retailers....................................... 18,002 19,052 21,082 18,475 18,725 18,961 19,629 21,082 20,525 20,060 28 Others.......................................... 1,755 1,971 2,321 2,221 2,277 2,283 2,350 2,321 2,296 2,356 Net change (during period)3 29 Total.................................................... 7,504 20,533 31,090 2,651 2,351 2,626 2,853 2,736 2,424 2,661 By holder: 30 Commercial banks.......................... 2,821 10,845 15,779 1,448 1,228 1,315 1,384 1,611 1,115 1,280 31 Finance companies......................... -90 2,644 5,376 321 378 487 543 500 460 418 32 Credit unions................................... 3,771 4,880 6,490 All 458 469 566 641 495 603 33 Retailers 1........................................ 69 1,050 2,032 170 144 280 184 -12 309 202 34 Others 2............................................ 933 1,115 1,413 240 143 75 111 -3 44 158 By type of credit: 35 Automobile....................................... 3,007 10,238 13,235 1,054 1,105 850 1,241 1,297 1,185 1,104 36 Commercial banks...................... 559 6,431 8,135 725 714 587 725 835 637 599 37 Indirect..................................... -334 2,823 4,194 357 466 295 444 486 407 389 38 Direct....................................... 894 3,608 3,941 368 248 292 281 349 230 210 39 Finance companies..................... 532 1,334 1,774 65 128 52 242 127 247 201 40 Credit unions............................... 1,872 2,422 3,222 237 228 222 263 328 244 300 41 Other............................................ 44 50 105 27 34 -11 10 7 56 4 42 Mobile homes................................... -195 150 441 55 32 44 74 76 52 23 43 Commercial banks...................... -323 85 128 3 10 15 23 60 2 2 44 Finance companies..................... -73 -177 -164 -18 -3 -11 4 -8 36 -9 45 881 1,585 1,967 183 143 201 211 173 105 171 46 Commercial banks...................... 271 588 920 62 11 115 99 110 70 69 Revolving credit: 47 Bank credit cards........................ 1,220 1,850 2,911 315 279 287 243 250 160 285 48 Bank check credit....................... 14 231 683 60 49 57 27 46 65 87 49 All other........................................... 2,577 6,479 11,853 984 743 1,188 1,057 895 857 991 50 Commercial banks, total............ 1,080 1,659 3,003 283 99 254 267 310 180 238 51 Personal loans......................... 858 1,040 2,070 161 56 142 183 235 81 167 52 Finance companies, total............ -348 1,509 3,749 273 251 448 293 378 111 223 53 Personal loans......................... 279 1,290 2,748 186 223 353 235 254 162 183 54 Credit unions............................... 1,580 2,045 2,719 200 197 204 252 252 205 252 55 Retailers....................................... 69 1,050 2,032 170 144 280 184 -12 309 202 56 Others........................................... 196 217 350 59 52 2 61 -33 -15 76 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 lumo sum, including single-payment loans, 2 Mutual savings banks, savings and loan associations, and auto dealers. charge accounts, and service credit—amounted to $44.2 billion at the end 3 Net change equals extensions minus liquidations (repayments, charge- of 1977, $38.7 billion at the end of 1976, $35.7 billion at the end of 1975, offs, and other credits); figures for all months are seasonally adjusted. and $33.8 billion at the end of 1974. Comparable data for Dec. 31, 1978, will be published in the February 1979 Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Consumer Debt A43 1.56 CONSUMER INSTALMENT CREDIT Extensions and Liquidations Millions of dollars 1977 1978 Holder, and type of credit 1975 1976 1977 Aug. Sept. Oct. Nov. Dec. Jan. Feb. Extensions3 1Total.................................................... 164,169 193,328 225,645 19,204 19,164 19,787 19,680 20,138 19,586 20,179 By holder: ?, 77,312 94,220 110,777 9,426 9,442 9,802 9,688 10,226 9,625 9,905 3 31,173 36,028 41,770 3,459 3,514 3,653 3,602 3,743 3,575 3,691 4 24,096 28,587 33,592 2,806 2,773 2,858 2,920 3,093 2,820 3,028 5 27,049 29,188 33,202 2,840 2,860 2,961 2,857 2,647 3,102 2,976 6 4,539 5,305 6,303 673 575 512 612 428 464 579 By type of credit: 7 51,413 62,988 72,888 6,158 6,109 6,083 6,330 6,721 6,263 6,400 8 Commercial banks...................... 28,573 36,585 42,570 3,616 3,640 3,642 3,717 3,941 3,650 3,700 9 Indirect.................................... 15,766 19,882 22,904 1,925 2,028 1,976 2,076 2,153 2,026 2,065 10 12,807 16,704 19,666 1,692 1,612 1,666 1,641 1,788 1,624 1,635 11 Finance companies..................... 9,674 11,209 12,635 1,036 1,013 989 1,097 1,143 1,088 1,080 1? Credit unions............................... 12,683 14,675 17,041 1,434 1,376 1,414 1,458 1,581 1,421 1,565 13 483 518 642 72 80 38 58 55 105 55 14 Mobile homes.................................. 4,323 4,841 5,244 479 424 457 464 460 449 406 15 2,622 3,071 3,153 267 261 270 280 300 250 236 16 Finance companies..................... 764 690 615 55 51 61 54 60 101 62 17 5,556 6,736 8,066 733 679 718 761 722 618 710 18 2,722 3,245 3,968 332 340 373 370 384 327 338 Revolving credit: 19 20,428 25,862 31,761 2,711 2,847 2,973 2,828 2,973 2,948 3,143 20 Bank check credit....................... 4,024 4,783 5,886 510 485 487 492 531 556 535 21 78,425 88,117 101,754 8,612 8,620 9,067 8,804 8,731 8,751 8,985 22 Commercial banks, total............ 18,944 20,673 23,439 1,990 1,870 2,056 2,001 2,096 1,893 1,953 23 Personal loans......................... 13,386 14,480 16,828 1,404 1,346 1,463 1,434 1,518 1,338 1,405 24 Finance companies, total........... 20,657 24,087 28,349 2,361 2,440 2,596 2,441 2,530 2,380 2,541 25 Personal loans......................... 16,944 19,579 22,323 1,870 1,938 2,044 1,914 1,975 1,851 1,989 26 10,134 12,340 14,604 1,207 1,240 1,282 1,285 1,326 1,236 1,288 27 Retailers....................................... 27,049 29,188 33,202 2,840 2,860 2,961 2,857 2,647 3,102 2,976 28 Others........................................... 1,642 1,830 2,160 214 211 172 221 131 138 227 Liquidations3 29 Total.................................................... 156,665 172,795 194,533 16,553 16,814 17,160 16,826 17,402 17,162 17,518 By holder: 30 Commercial banks.......................... 74,491 83,376 94,998 7,978 8,214 8,487 8,305 8,615 8,509 8,625 31 Finance companies......................... 31,263 33,384 36,372 3,138 3,135 3,166 3,059 3,244 3,114 3,273 32 20,325 23,707 27,103 2,333 2,316 2,389 2,354 2,452 2,325 2,425 33 26,980 28,138 31,170 2,670 2,716 2,681 2,673 2,659 2,793 2,774 34 3,606 4,191 4,890 433 432 437 435 432 420 421 By type of credit: 35 48,406 52,750 59,610 5,104 5,005 5,234 5,089 5,424 5,078 5,296 36 Commercial banks............................ 28,014 30,154 34,435 2,891 2,926 3,055 2,991 3,106 3,013 3,101 37 16,101 17,059 18,710 1,568 1,562 1,681 1,632 1,667 1,619 1,676 38 Direct...................................... 11,913 13,095 15,726 1,324 1,364 1,374 1,360 1,439 1,394 1,425 39 9,142 9,875 10,819 970 885 937 855 1,017 841 879 40 10,811 12,253 13,819 1,197 1,148 1,193 1,195 1,253 1,177 1,265 41 439 468 536 45 46 49 48 48 48 51 42 Mobile homes.................................. 4,517 4,691 4,793 424 392 413 390 384 398 383 43 2,944 2,986 3,025 264 251 255 257 240 248 234 44 Finance companies..................... 837 867 806 73 54 72 50 68 65 71 45 4,675 5,151 6,098 551 536 517 550 549 514 539 46 Commercial banks...................... 2,451 2,657 3,048 270 263 257 272 274 257 269 Revolving credit: 47 Bank credit cards........................ 19,208 24,012 28,851 2,396 2,567 2,687 2,585 2,723 2,788 2,858 48 4,010 4,552 5,202 450 436 430 466 485 491 448 49 75,849 81,638 89,977 7,628 7,877 7,880 7,747 7,836 7,894 7,994 50 Commercial banks, total............ 17,864 19,014 20,436 1,707 1,771 1,802 1,734 1,786 1,713 1,715 51 Personal loans......................... 12,528 13,439 14,757 1,243 1,291 1,321 1,250 1,284 1,258 1,238 52 Finance companies, total........... 21,005 22,578 24,676 2,089 2,189 2,148 2,148 2,152 2,203 2,318 53 Personal loans......................... 16,665 18,289 19,596 1,684 1,714 1,692 1,678 1,722 1,688 1,806 54 8,554 10,295 11,884 1,008 1,043 1,078 1,033 1,075 1,031 1,036 55 Retailers....................................... 26,980 28,138 31,170 2,670 2,716 2,681 2,673 2,659 2,793 2,774 56 1,446 1,613 1,811 155 158 170 159 165 153 151 1 Excludes 30-day charge credit held by retailers, oil and gas companies, 2 Mutual savings banks, savings and loan associations, and auto dealers, and travel and entertainment companies. 3 Monthly figures are seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A44 Domestic Financial Statistics □ April 1978 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; half-year data are at seasonally adjusted annual rates. 1975 1976 1977 1974 1975 1976 1977 Transaction category, or sector HI H2 HI H2 HI H2 Nonfinancial sectors 189.6 205.6 268.3 335.9 180.8 230.4 254.5 282.1 306.2 365.6 1 2 185.8 195.5 257.8 327.4 170.3 220.8 241.1 274.4 297.3 357.5 2 By sector and instrument: 3 U.S. Govt........................................................ 11.8 85.4 69.0 56.8 79.6 91.2 73.1 64.9 40.3 73.2 3 4 12.0 85.8 69.1 57.6 80.4 91.3 73.0 65.3 40.9 74.4 4 5 Agency issues and mortgages.................... -.2 -.4 -.1 -.9 -.8 -.1 .1 -.3 -.6 -1.2 5 6 177.8 120.2 199.2 279.1 101.1 139.2 181.4 217.1 265.9 292.4 6 7 Corporate equities..................................... 3.8 10.0 10.5 8.5 10.5 9.6 13.3 7.6 8.9 8.1 7 8 Debt instruments....................................... 174.0 110.1 188.8 270.6 90.7 129.6 168.0 209.5 257.0 284.3 8 9 Private domestic nonfinancial sectors........ 162.4 107.0 179.0 266.9 93.1 120.9 166.2 191.7 260.9 272.9 9 10 Corporate equities.................................. 4.1 9.9 10.5 8.1 10.3 9.5 13.3 7.7 8.2 8.0 10 11 158.3 97.1 168.4 258.8 82.8 111.4 152.9 184.0 252.7 265.0 11 12 Debt capital instruments..................... 98.7 95.8 122.7 172.8 93.8 97.8 111.7 133.7 159.3 186.2 12 13 State and local obligations............ 17.1 13.6 15.1 28.1 12.3 14.9 14.7 15.5 28.3 27.9 13 14 19.7 27.2 22.8 18.0 33.4 21.1 20.4 25.3 14.4 21.6 14 Mortgages: 15 34.8 39.5 63.6 90.0 33.4 45.6 57.1 70.2 85.5 94.5 15 16 Multifamily residential............... 6.9 * 1.6 7.0 .4 -.4 .6 2.6 5.3 8.8 16 17 Commercial................................. 15.1 11.0 13.4 20.9 9.4 12.6 13.9 12.9 16.7 25.0 17 18 5.0 4.6 6.1 8.7 5.1 4.0 5.0 7.3 9.0 8.5 18 19 Other debt instruments....................... 59.6 1.3 45.7 86.1 - 11.0 13.6 41.2 50.3 93.4 78.7 19 20 Consumer credit............................. 10.2 9.4 23.6 35.6 2.2 16.6 22.9 24.2 35.5 35.7 20 2! Bank loans n.e.c.............................. 29.1 -14.5 3.7 30.0 -20.9 -8.2 -.3 7.8 37.4 22.5 21 22 6.6 -2.6 4.0 2.5 -1.4 -3.8 6.4 1.6 4.4 .6 22 23 13.7 9.0 14.4 18.0 9.0 9.0 12.2 16.7 16.0 19.9 23 24 By borrowing sector................................ 162.4 107.0 179.0 266.9 93.1 120.9 166.2 191.7 260.9 272.9 24 25 State and local governments.............. 16.2 11.2 14.6 24.8 10.0 12.3 13.0 16.3 21.7 27.9 25 26 49.2 48.6 89.8 130.9 37.3 59.9 83.9 95.6 129.6 132.2 26 27 7.9 8.7 11.0 15.1 8.7 8.8 10.6 11.6 16.6 13.6 27 28 Nonfarm noncorporate...................... 7.4 2.0 5.2 10.8 -1.1 5.1 2.7 7.6 10.9 10.7 28 29 Corporate............................................ 81.8 36.6 58.3 85.3 38.3 34.8 56.1 60.5 82.1 88.4 29 30 15.4 13.2 20.3 12.2 8.0 18.3 15.2 25.4 5.0 19.5 30 31 -.2 .1 * .4 .1 .1 * -.1 .6 .2 31 32 15.7 13.0 20.3 11.8 7.9 18.2 15.1 25.5 4.3 19.3 32 33 2.1 6.2 8.4 5.0 5.7 6.8 7.3 9.5 4.3 5.7 33 34 Bank loans n.e.c.................................. 4.7 3.7 6.7 .6 -.4 7.8 3.4 10.0 -5.8 7.0 34 35 Open market paper............................. 7.3 .3 1.9 2.8 -.8 1.4 1.5 2.4 2.7 3.0 35 36 U.S. Govt, loans................................. 1.6 2.8 3.3 3.4 3.4 2.2 2.9 3.6 3.1 3.6 36 Financial sectors 39.4 14.0 28.6 62.7 15.1 12.8 27.8 29.4 63.1 62.3 37 By instrument: 38 23.1 13.5 18.6 26.1 14.5 12.6 18.6 18.6 25.7 26.6 38 39 Sponsored credit agency securities............ 16.6 2.3 3.3 6.9 1.9 2.8 4.5 2.1 10.1 3.7 39 40 Mortgage pool securities........................... 5.8 10.3 15.7 20.4 11.5 9.2 14.2 17.2 17.9 22.9 40 41 Loans from U.S. Govt............................... .7 .9 — .4 -1.2 1.1 .6 * -.7 -2.3 ..............41 42 16.3 .4 10.0 36.5 .6 .2 9.1 10.8 37.4 35.7 42 43 .3 * .1 -.1 .1 -.1 -.7 2.2 -.3 .1 43 44 Debt instruments......................................... 16.0 .4 9.2 36.6 .6 .3 9.8 8.6 37.7 35.6 44 45 Corporate bonds..................................... 2.1 2.9 5.8 8.7 2.3 3.5 7.0 4.5 8.1 9.2 45 46 -1.3 2.3 2.1 3.1 1.4 3.2 1.4 2.8 3.1 3.1 46 47 4.6 -3.6 -3.7 -.2 -4.7 -2.5 -3.0 -4.4 -2.7 2.3 47 48 Open market paper and Rp’s............... 3.9 2.8 7.1 20.8 8.2 -2.6 6.1 8.1 25.8 15.7 48 49 6.7 -4.0 -2.0 4.3 -6.6 -1.3 -1.6 -2.4 3.5 5.2 49 By sector: 50 Sponsored credit agencies............................. 17.3 3.2 2.9 5.7 3.0 3.4 4.5 1.4 7.8 3.7 50 51 5.8 10.3 15.7 20.4 11.5 9.2 14.2 17.2 17.9 22.9 51 52 16.3 .4 10.0 36.5 .6 .2 9.1 10.8 37.4 35.7 52 53 -1.1 1.7 7.4 11.1 5.7 -2.3 9.0 5.9 14.7 7.5 53 54 3.5 .3 -.8 1.3 .9 -.3 -1.3 -.3 1.3 1.2 54 55 6.3 -2.2 * 11.9 -6.8 2.3 .5 -.5 11.0 12.8 55 56 Other insurance companies....................... .9 1.0 1.0 1.0 .9 1.0 1.0 1.0 1.0 1.0 56 57 Finance companies.................................... 4.5 .5 6.4 15.1 -1.4 2.4 5.7 7.1 14.3 15.9 57 58 REIT’s........................................................ .6 -2.0 -2.8 -2.4 -2.0 -1.9 -2.5 -3.0 -2.9 -1.8 58 59 Open-end investment companies.............. -.7 -.1 -1.0 -1.5 .7 -.9 -2.5 .5 -1.4 -1.6 59 60 2.4 1.3 -.3 .1 2.6 * -.7 .2 -.5 .8 60 All sectors 61 229.0 219.5 296.8 398.6 195.9 243.2 282.2 311.4 369.2 427.9 61 62 Investment company shares.......................... -.7 -.1 -1.0 -1.5 .7 -.9 -2.5 .5 -1.4 -1.6 62 63 Other corporate equities............................... 4.8 10.2 12.2 9.9 9.8 10.5 15.1 9.3 10.0 9.8 63 64 Debt instruments............................................. 224.9 209.5 285.6 390.2 185.4 233.6 269.6 301.6 360.7 419.7 64 65 U.S. Govt, securities.................................. 34.3 98.2 88.1 84.2 93.1 103.2 91.9 84.3 68.4 99.9 65 66 17.1 13.6 15.1 28.1 12.3 14.9 14.7 15.5 28.3 27.9 66 67 Corporate and foreign bonds.................... 23.9 36.3 37.0 31.7 41.3 31.3 34.7 39.3 26.8 36.5 67 68 Mortgages................................................... 60.5 57.2 86.8 129.7 49.5 65.0 77.9 95.7 119.5 139.8 68 69 Consumer credit......................................... 10.2 9.4 23.6 35.6 2.2 16.6 22.9 24.2 35.5 35.7 69 70 Bank loans n.e.c.......................................... 38.4 -14.4 6.7 30.4 -25.9 -2.9 .1 13.4 28.9 31.8 70 71 Open market paper and Rp's................... 17.8 .5 13.0 26.1 6.1 -5.0 14.0 12.0 32.9 19.3 71 72 22.7 8.7 15.3 24.5 6.9 10.5 13.4 17.2 20.2 28.7 72 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 1977 Transaction category, or sector 1974 1975 1976 1977 HI H2 HI H2 HI H2 1 Total funds advanced in credit markets to nonfinancial sectors..................................... 185.8 195.5 257.8 327.4 170.3 220.8 241.1 214. A 297.3 357.5 1 By public agencies and foreign: 2 Total net advances.............................................. 52.7 44.3 54.6 84.6 55.0 33.6 53.2 56.0 73.6 95.5 2 3 U.S. Govt, securities...................................... 11.9 22.5 26.8 39.7 33.4 11.6 27.1 26.5 30.6 48.8 3 4 Residential mortgages................................... 14.7 16.2 12.8 20.4 16.9 15.5 12.1 13.5 20.1 20.8 4 6.7 -4.0 -2.0 4.3 -6.6 -1.3 -1.6 -2.4 3.5 5.2 5 6 Other loans and securities............................. 19.5 9.5 16.9 20.2 11.3 7.8 15.6 18.3 19.5 20.8 6 Totals advanced, by sector 7 U.S. Govt....................................................... 9.8 15.1 8.9 10.9 15.9 14.3 6.4 11.4 6.0 15.8 7 25.6 14.5 20.6 26.8 16.5 12.6 20.7 20.6 27.5 26.1 8 9 Monetary authorities..................................... 6.2 8.5 9.8 7.1 7.6 9.5 14.5 5.2 11.6 2.7 9 11.2 6.1 15.2 39.7 15.0 -2.7 11.6 18.8 28.5 50.9 10 11 Agency borrowing not included in line 1........ 23.1 13.5 18.6 26.1 14.5 12.6 18.6 18.6 25.7 26.6 11 Private domestic funds advanced 12 Total net advances.............................................. 156.1 164.8 221.8 269.0 129.8 199.7 206.6 237.0 249.4 288.6 12 22.4 75.7 61.3 44.5 59.7 91.6 64.8 57.8 37.9 51.2 13 14 State and local obligations............................ 17.1 13.6 15.1 28.1 12.3 14.9 14.7 15.5 28.3 27.9 14 20.9 32.8 30.3 19.2 38.8 26.8 26.8 33.9 15.6 22.7 15 26.9 23.2 52.4 76.5 16.7 29.6 45.5 59.2 70.7 82.4 16 17 Other mortgages and loans........................... 75.4 15.6 60.8 105.0 -4.3 35.5 53.2 68.3 100.3 109.7 17 18 Less: FHLB advances................................... 6.7 -4.0 -2.0 4.3 -6.6 -1.3 -1.6 -2.4 3.5 5.2 18 Private financial intermediation 19 Credit market funds advanced by private financial institutions.................................... 126.3 119.9 187.2 242.7 99.8 140.0 167.6 206.8 235.5 250.0 19 20 Commercial banking..................................... 64.6 27.6 58.0 79.8 14.4 40.7 44.5 71.5 80.6 79.1 20 26.9 52.0 71.7 86.4 48.5 55.4 71.8 71.7 84.7 88.0 21 30.0 41.5 47.6 61.1 38.3 44.7 47.8 47.3 58.2 63.9 22 4.7 -1.1 9.9 15.5 -1.4 -.7 3.4 16.3 11.9 19.0 23 126.3 119.9 187.2 242.7 99.8 140.0 167.6 206.8 235.5 250.0 24 25 Private domestic deposits.............................. 69.4 90.9 122.8 135.4 90.3 91.5 106.1 139.5 122.9 147.8 25 26 Credit market borrowing............................... 16.0 .4 9.2 36.6 .6 .3 9.8 8.6 31.1 35.6 26 40.9 28.6 55.1 70.7 9.0 48.2 51.7 58.7 74.9 66.6 21 28 Foreign funds............................................. 14.5 -.4 3.1 1.3 -5.6 4.8 -2.6 8.8 -2.9 5.5 28 29 Treasury balances...................................... -5.1 -1.7 -.1 4.2 -3.5 .1 2.9 -3.1 -1.1 9.5 29 30 Insurance and pension reserves................ 26.0 29.0 35.8 48.6 26.4 31.5 35.1 36.5 47.2 50.0 30 5.4 1.7 16.4 16.6 -8.3 11.7 16.2 16.6 31.7 1.5 31 Private domestic nonfinancial investors 32 Direct lending in credit markets........................ 45.9 45.3 43.8 62.9 30.6 60.0 48.8 38.8 51.6 74.2 32 33 U.S. Govt, securities..................................... 18.2 22.2 19.4 23.8 6.0 38.4 22.6 16.1 11.3 36.3 33 34 State and local obligations............................ 10.0 6.3 4.7 5.6 7.2 5.5 3.9 5.5 7.0 4.3 34 35 Corporate and foreign bonds....................... 4.7 8.2 4.0 .2 10.8 5.6 4.9 3.1 -1.9 2.2 35 36 Commercial paper......................................... 4.8 3.1 4.0 16.6 1.5 4.7 6.7 1.3 18.8 14.4 36 37 Other............................................................... 8.2 5.5 11.8 16.6 5.1 6.0 10.8 12.8 16.4 16.9 37 75.7 97.1 130.1 143.6 96.0 98.2 111.0 149.3 127.2 160.0 38 66.7 84.8 113.0 120.9 73.0 96.5 98.3 127.6 106.7 135.1 39 40 Large negotiable CD’s............................... 18.8 -14.0 -14.2 10.8 -27.8 -.2 -18.0 -10.4 -2.7 24.2 40 41 Other at commercial banks....................... 26.1 39.4 58.1 40.4 39.3 39.4 50.2 66.0 41.9 38.9 41 42 At savings institutions............................... 21.8 59.4 69.1 69.7 61.5 57.4 66.1 72.1 67.4 72.0 42 8.9 12.3 17.2 22.7 23.0 1.7 12.7 21.6 20.5 25.0 43 44 Demand deposits....................................... 2.6 6.1 9.9 14.5 17.3 -5.0 7.8 11.9 16.2 12.8 44 6.3 6.2 7.3 8.2 5.7 6.7 4.9 9.8 4.3 12.2 45 46 Total of credit market instruments, deposits 121.5 142.4 174.0 206.5 126.6 158.2 159.8 188.1 178.8 234.2 46 47 Public support rate (in per cent)................... 28.4 22.7 21.2 25.8 32.3 15.2 22.1 20.4 24.8 26.7 47 48 Private financial intermediation (in per cent) 80.9 72.8 84.4 90.2 76.9 70.1 81.1 87.3 94.4 86.6 48 25.7 5.8 18.3 41.0 9.4 2.1 9.0 27.6 25.6 56.4 49 Memo : Corporate equities not included above 4.1 10.0 11.2 8.4 10.5 9.5 12.6 9.8 8.5 8.2 50 51 Mutual fund shares....................................... -.7 -.1 -1.0 -1.5 .7 -.9 -2.5 .5 -1.4 -1.6 51 4.8 10.2 12.2 9.9 9.8 10.5 15.1 9.3 10.0 9.8 52 53 Acquisitions by financial institutions............... 5.8 9.4 12.3 6.7 10.7 8.1 12.6 12.0 4.4 9.1 53 54 Other net purchases........................................... -1.6 .6 -1.1 1.6 -.2 1.4 * -2.2 4.1 -.9 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 □ April 1978 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures 1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted. 1977 1978 Measure 1975 1976 1977 Aug.r Sept. Oct. Nov. Dec. Jan. Feb.P Mar.* 117.8 129.8 137.0 137.1 138.5 138.9 139.3 *•139.7 138.6 139.0 141.0 Market groupings: ? 119.3 129.3 137.1 137.1 138.8 138.9 139.5 140.3 138.5 139.8 142.0 3 118.2 127.2 134.9 134.9 136.8 136.5 137.0 *•137.6 135.0 136.7 139.1 4 124.0 136.2 143.4 143.4 144.9 144.9 145.2 145.8 141.5 143.8 146.8 5 110.2 114.6 123.2 123.2 125.6 125.0 125.8 M26.2 125.9 127.0 128.5 6 123.1 137.2 145.1 145.1 146.5 147.8 148.4 *•150.4 151.2 151.4 152.6 7 115.5 130.6 136.9 136.9 137.9 138.9 139.0 *•138.8 138.8 137.8 139.5 Industry groupings: 8 Manufacturing.................................................... 116.3 129.5 137.1 137.1 139.0 139.4 139.9 140.5 138.7 139.5 141.6 Capacity utilization (per cent)1 in— 9 Manufacturing........................................................ 73.6 80.2 82.4 82.5 82.9 82.9 82.9 83.0 81.7 81.9 82.9 10 Industrial materials industries............................... 73.6 80.4 81.9 81.9 82.0 82.4 82.3 *•81.9 81.7 80.9 81.7 11 Construction contracts2........................................... 162.3 190.2 253.0 267.0 279.0 244.0 258.0 299.0 270.0 266.0 12 Nonagricultural emnlovment- total3.......................... 117.0 120.6 124.7 125.2 125.7 125.9 126.4 126.7 127.1 127.6 128.3 13 Goods-producing, total.......................................... 97.1 100.3 104.1 104.5 104.7 105.0 105.4 105.4 105.7 106.3 107.0 14 Manufacturing, total.......................................... 94.3 97.5 100.6 100.8 100.8 101.1 101.4 102.2 102.7 103.2 103.6 15 Manufacturing, production-worker.................. 91.3 95.2 98.3 98.4 98.5 98.8 99.1 100.0 100.7 101.3 101.6 16 Service-nroducinff. ................................................. 127.8 131.7 136.0 136.6 137.1 137.3 137.9 138.3 138.8 139.3 139.9 17 Personal income, total4.............................................. 200.0 220.7 245.1 247.2 249.2 252.8 r255.7 r259.0 259.5 260.8 18 Wages and salary disbursements........................... 188.5 208.6 231.5 233.4 235.2 239.1 r240.9 r242.2 244.8 246.5 IQ Manufacturing___________________________ 157.3 177.7 199.3 200.7 202.2 205.3 206.9 *•209.7 210.8 213.2 20 Disnosahle nersonal income...................................... 199.2 217.8 r239.0 241.3 *■245.3 21 Retail sales 5............................................................... 184.6 203.5 224.4 221.4 225.4 232.2 235.3 *•237.1 228.7 235.7 240.1 Prices:6 22 Consumer7.............................................................. 161.2 170.5 181.6 183.3 184.0 184.5 185.4 186.1 187.2 188.4 23 Wholesale.............................................................. 174.9 183.0 194.2 194.6 195.8 196.3 197.0 198.2 199.9 202.0 1 Ratios of indexes of production to indexes of capacity. Based on data 6 Data without seasonal adjustment, as published in Monthly Labor from Federal Reserve, McGraw-Hill Economics Department, and De Review (U.S. Dept, of Labor). Seasonally adjusted data for changes in partment of Commerce. the price indexes may be obtained from the Bureau of Labor Statistics, 2 Index of dollar value of total construction contracts, including U.S. Dept, of Labor. residential, nonresidential, and heavy engineering, from McGraw-Hill 7 Beginning Jan. 1978, based on new index for all urban consumers. Informations Systems Company, F. W. Dodge Division. 3 Based on data in Employment and Earnings (U.S. Dept, of Labor). Note.—Basic data (not index numbers) for series mentioned in notes Series covers employees only, excluding personnel in the Armed Forces. 3, 4, and 5, and indexes for series mentioned in notes 2 and 6 may also be 4 Based on data in Survey of Current Business (U.S. Dept, of Com found in the Survey of Current Business (U.S. Dept, of Commerce). merce). Series for disposable income is quarterly. Figures for industrial production for the last 2 months are preliminary 5 Based on Bureau of Census data published in Survey of Current and estimated, respectively. Business (U.S. Dept, of Commerce). 2.11 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION Seasonally adjusted 1977 1978 1977 1978 1977 1978 Series Q2 Q3 Q4 r Ql Q2 Q3 Q4 Ql Q2 Q3 Q4 r Ql Output (1967 = 100) Capacity (per cent of 1967 output) Utilization rate (per cent) 136.9 138.7 139.9 139.9 165.6 167.1 168.7 170.3 82.7 83.0 82.9 82.2 2 Primary processing................................... 146.3 147.3 148.2 147.8 171.8 173.5 175.1 176.8 85.1 84.9 84.6 83.6 3 132.0 129.3 135.6 135.7 162.2 163.8 165.3 166.9 81.4 81.9 82.0 81.3 137.7 138.1 138.9 138.7 166.6 167.8 168.9 170.4 82.6 82.3 82.2 81.4 5 135.1 136.0 137.7 138.0 170.3 171.6 172.8 174.0 79.4 79.2 79.6 79.3 6 Basic metal ..................................... 116.4 109.4 109.4 145.1 145.3 145 5 80.2 75. 3 75.2 7 Nondurable goods................................... 154.6 154.4 155.0 156.7 177.2 178.8 180.4 ihi.s Si'. 2 86! 3 B5.9 85.9* 8 Textile, paper, and chemical............... 159.9 159.2 159.5 162.1 185.4 187.1 188.9 190.8 86.3 85.1 84.5 85.0 9 Textile............................................... 110.9 112.3 117.9 141.9 142.5 143.0 78.1 78.8 82.4 10 Paper................................................. 134.3 135.1 132.3 150.1 151.3 152.5 89.5 89.3 86.7 11 Chemical........................................... 191.8 189.5 188.9 218.7 221.2 223.6 87.7 85.7 84 5 12 122.6 123.4 121.9 118.1 144.7 145.2 145.7 147.2 84.8 85.0 83*. 7 80.2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Labor Market A47 2.12 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data are seasonally adjusted. Exceptions noted. 1977 1978 Category 1975 1976 1977 Sept. Oct. Nov. Dec.r Jan.r Feb. Mar. Household survey data 1 Noninstitutional population1.............. 153,449 156,048 158,559 159,114 159,334 159,522 159,736 159,937 160,128 160,313 2 Labor force (including Armed 94,793 96,917 99,534 99,887 100,205 101,009 101,048 101,228 101,217 101,536 3 Civilian labor force............................. 92,613 94,773 97,401 97,756 98,071 98,877 98,919 99,107 99,093 99,414 iLiiipiuyiiiciii. 4 Nonagricultural industries2........ 81,403 84,188 87,302 87 889 88,140 88,857 89,286 89,527 89.761 89,956 5 Agriculture.................................. 3,380 3,297 3,244 3,199 3,243 3,357 3,323 3.354 3,242 3,310 Unemployment: 6 Number....................................... 7,830 7,288 6,855 6,668 6,688 6,663 6,310 6,226 6,090 6,148 7 Rate (per cent of civilian labor force).................................... 8.5 7.7 7.0 6.8 6.8 6.7 6.4 6.3 6.1 6.2 8 Not in labor force............................... 58,655 59,130 59,025 59,227 59,130 58,512 58,688 58,709 58,911 58,776 Establishment survey data 9 Nonagricultural payroll employment3 17,051 79,443 82,142 82,763 82,902 83,245 83,429 83,719 84,055 84,498 10 Manufacturing............................... 18,347 18,956 19,555 19,612 19,666 19,715 19,868 19,972 20,071 20,146 11 Mining............................................. 745 783 831 856 859 863 711 705 711 727 12 Contract construction..................... 3,512 3,594 3,845 3,892 3,911 3,950 3,947 3,916 3,947 4,023 13 Transportation and public utilities. 4,498 4,509 4,589 4,616 4,610 4,634 4,652 4,628 4,657 4,681 14 Trade................................................ 17,000 17,694 18,291 18,431 18,414 18,512 18,610 18,744 18,762 18,849 15 Finance............................................ 4,223 4,316 4,508 4,545 4,572 4,597 4,611 4.630 4,649 4,669 16 Service.............................................. 14,006 14,644 15,333 15,482 15,533 15,608 15,663 15,693 15,793 15,879 17 Government.................................... 14,720 14,948 15,190 15,329 15,337 15,366 15,367 15.431 15,465 15,524 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 □ April 1978 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value Monthly data are seasonally adjusted. 1967 1977 1978 Grouping pro 1977 por aver tion age Jan. Feb. Mar. Aug. Sept. Oct. Nov. Dec. Jan. Feb.* Mar.* Index(1967 = 100) MAJOR MARKET 1 Total index.............................................................. 100.00 137.1 132.3 133.2 135.3 138.1 138.5 138.9 139.3 139.7 138.6 139.0 141.0 2 Products.................................................................. 60.71 137.1 133.1 133.6 135.1 138.4 138.8 138.9 139.5 140.3 138.5 139.8 142.0 3 Final products...................................................... 47.82 134.9 130.8 131.6 133.3 136.3 136.8 136.5 137.0 137.6 135.0 136.7 139.1 4 Consumer goods............................................. 27.68 143.4 139.9 140.5 142.9 144.7 144.9 144.9 145.2 145.8 141.5 143.8 146.8 5 Equipment....................................................... 20.14 123.2 118.4 119.2 120.0 124.9 125.6 125.0 125.8 126.2 125.9 127.0 128.5 6 Intermediate products........................................ 12.89 145.1 142.2 141.6 141.8 146.1 146.5 147.8 148.4 150.4 151.2 151.4 152.6 7 Materials.................................................................. 39.29 136.9 131.1 132.7 135.5 137.6 137.9 138.9 139.0 138.8 138.8 137.8 139.5 Consumer goods 8 Durable consumer goods..................................... 7.89 153.1 145.4 146.1 152.4 154.7 155.6 156.8 155.2 155.8 146.4 151.4 159.2 9 2.83 174.2 164.2 161.7 178.3 177.2 177.0 179.4 173.6 172.4 157.6 162.5 179.3 10 Autos and utility vehicles........................... 2.03 169.2 155.8 152.7 176.1 173.1 172.6 176.1 167.6 165.5 145.8 153.0 175.7 11 Autos........................................................ 1.90 148.4 136.9 132.8 155.8 150.9 151.6 154.3 147.5 143.6 127.4 131.5 149.7 12 Auto parts and allied goods...................... .80 186.8 185.6 184.3 184.1 187.3 188.1 187.6 188.7 190.4 187.8 186.3 188.2 13 Home goods.................................................... 5.06 141.3 134.8 137.3 137.9 142.1 143.6 144.2 145.0 146.6 140.1 145.1 147.9 14 Appliances, A/C, and TV........................... 1.40 127.3 113.4 118.5 124.1 129.6 129.4 128.6 131.4 132.8 116.1 133.3 137.1 15 Appliances and TV................................. 1.33 no.5 116.0 121.1 126.5 133.0 134.1 131.6 133.0 134.6 117.4 135.7 16 Carpeting and furniture............................. 1.07 157.2 143.7 146.0 144.6 154.8 159.0 160.5 160 0 161 5 158! 1 159*4 17 Misc. home goods....................................... 2.59 144.3 142.7 144.0 142.7 143.6 144.9 145.8 146^3 147’.7 145i9 145 J 148.6 18 Nondurable consumer goods............................... 19.79 139.6 137.1 138.3 139.1 140.6 140.7 140.1 141.2 141.8 139.7 140.7 141.8 19 Clothing........................................................... 4.29 175.2 123.7 123.6 123.9 126.4 128.3 128.0 126.4 126 9 118.3 20 Consumer staples............................................ 15.50 143.6 141.7 142.2 143.3 144.6 144.1 143.5 145.3 145^9 145!6 145.7 146.4 ?1 Consumer foods and tobacco.................... 8.33 135.5 131.5 133.3 136.0 137.9 137.1 135.2 136.7 137.9 136.5 137.3 22 Nonfood staples.......................................... 7.17 152.9 153.4 152.6 151.8 152.4 152.4 153.4 155.1 155.2 156.3 155.2 155.6 23 Consumer chemical products................. 2.63 180.5 178.5 175.7 175.9 181.8 182.5 183.7 186.9 186.5 187.4 185.3 24 Consumer paper products...................... 1.92 117.1 116.0 113.3 117.4 117.0 116.4 117.6 118.5 119*8 121 4 120 3 25 Consumer energy products..................... 2.62 151.4 155.8 158.3 152.8 148.9 148.6 149.1 149.9 149‘.7 15017 150! 6 26 Residential utilities............................. 1.45 159.0 166.7 167.1 158.3 Equipment 27 Business equipment.............................................. 12.63 149.2 142.3 143.5 144.8 151.1 152.1 152.6 153.5 154.0 152.9 154.8 156.7 28 Industrial equipment...................................... 6.77 138.5 131.3 133.2 134.4 140.4 141.4 141.8 142.6 143.0 144.3 144.9 146.9 29 Building and mining equipment................ 1.44 202.5 187.4 192.9 197.9 203.9 204.5 205.7 206.7 208.3 211.1 214.5 219.5 30 Manufacturing equipment......................... 3.85 113.9 107.8 108.5 109.0 115.3 117.6 118.5 118.7 118.2 118.8 118.6 119.5 31 Power equipment........................................ 1.47 140.2 137.5 139.3 138.3 143.7 141.4 139.8 142.1 143.7 146.1 145.9 147.2 32 Commercial transit, farm equipment............ 5.86 161.6 155.0 155.3 156.9 163.4 164.4 165.1 165.9 166.9 162.7 166.3 168.2 33 Commerical equipment............................... 3.26 191.6 185.2 185.6 186.1 193.0 193.7 195.4 197.4 198.8 198.8 200.8 202.6 34 Transit equipment....................................... 1.93 117.8 108.4 108.7 113.0 121.9 125.1 122.3 118.9 121.1 110.9 117.0 118.7 35 Farm equipment......................................... .67 142.3 142.5 142.5 141.8 139.2 134.9 142.1 147.8 144.5 135.8 139.2 36 Defense and space equipment............................. 7.51 79.6 78.0 78.5 78.5 80.8 80.9 78.9 79.3 79.5 80.4 80.2 81.2 Intermediate products 37 Construction supplies......................................... 6.42 140.8 136.2 135.6 136.4 141.7 143,2 144.9 146.5 148.3 149.1 149.5 151.2 38 Business supplies................................................. 6.47 149.5 148.0 147.6 147.3 150.6 149.7 150.5 150.1 152.6 153.3 153.4 39 Commercial energy products......................... 1.14 164.6 164.9 164.9 163.6 165.0 162.7 163.0 160.9 165.6 165.4 163.8 Materials 40 Durable goods materials..................................... 20.35 134.5 127.4 128.4 131.9 135.4 135.7 137.1 137.2 138.7 138.2 137.0 138.8 41 Durable consumer parts................................. 4.58 132.0 121 .8 124.1 126.8 135.2 135.8 135.4 136.5 135.7 133.0 130.9 135.0 42 Equipment parts............................................. 5.44 143.1 135.1 137.3 137.8 145.6 146.8 147.6 147.2 149.2 148.7 147.2 148.9 43 Durable materials n.e.c.................................. 10.34 131.1 125.9 125.5 131.1 130.1 129.8 132.4 132.3 134.3 134.9 134.5 135.2 44 5.57 110.9 106.6 105.5 113.6 108.7 106.8 110.0 107.9 110.3 110.2 110.3 45 Nondurable goods materials............................... 10.47 153.5 144.8 150.4 153.3 155.1 153.9 154.4 155.4 155.3 154.8 156.6 158.6 46 Textile, paper, and chem. mat....................... 7.62 158.3 149.3 153.9 158.4 159.6 159.0 160.0 159.3 159.3 160.9 161.8 163.6 47 Textile materials.......................................... 1.85 113.0 111.0 109.8 113.2 112.2 114.5 118.5 117.8 117.3 114.9 115.8 48 Paper materials........................................... 1.62 133.5 127.6 133.5 133.9 135.7 135.2 134.4 132.2 130.2 134.3 136.0 49 Chemical materials..................................... 4.15 188.2 175.1 181.6 188.0 190.1 188.2 188.5 188.6 189.5 191.9 192.5 50 Containers, nondurable.................................. 1.70 150.9 139.5 150.2 148.9 156.2 151.2 148.9 156.7 154.4 148.5 154.0 51 Nondurable materials n.e.c........................... 1.14 125.3 122.6 126.8 126.1 122.4 124.1 125.4 128.5 129.9 123.6 126.0 52 Energy materials................................................. 8.48 122.4 123.3 120.8 121.8 121.4 123.5 124.0 123.0 118.7 120.7 116.2 117.4 53 Primary energy............................................... 4.65 107.3 102.9 103.1 107.0 106.8 110.0 112.2 111.6 103.0 103.5 100.6 54 Converted fuel materials................................ 3.82 140.7 148.1 142.4 139.9 139.1 140.0 138.4 136.9 137.7 141.7 135.2 Supplementary groups 55 Home goods and clothing................................. 9.35 133.9 129.7 131.0 131.5 134.9 136.5 136.8 136.5 137.5 130.1 134.9 137.6 56 12.23 132.5 134.1 132.9 132.3 131.4 132.5 133.0 132.3 129.7 131.3 128.0 128.3 57 Products.......................................................... 3.76 155.4 158.5 160.3 156.0 153.7 153.0 153.3 153.2 154.5 155.1 154.6 58 8.48 122.4 123.3 120.8 121.8 121.4 123.5 124.0 123.0 118.7 120.7 116.2 ill A For Note see opposite page. 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Output A49 2.13 Continued 1967 1977 1978 Grouping SIC pro 1977 code por aver tion age Jan. Feb. Mar. Aug. Sept. Oct. Nov. Dec. Jan. Feb.p Mar.* Index (1967 = 100) MAJOR INDUSTRY 1 Mining and utilities. 12.05 136.2 137.0 137.1 136.6 134.4 135.1 135.8 135.5 133.9 136.3 135.6 136.6 2 Mining................. 6.36 117.8 112.8 116.3 120.6 115.4 118.0 119.6 118.8 113.4 113.8 114.0 119.0 3 Utilities................ 5.69 156.5 163.8 160.3 154.8 155.7 154.1 154.0 154.2 156.7 161.3 159.6 156.3 4 Electric............. 3.88 183.6 179.1 5 Manufacturing. 87.95 137.1 131.6 132.6 135.1 138.6 139.0 139.4 139.9 140.5 138.7 139.5 141.6 6 Nondurable., 35.97 148.1 143.4 145.3 147.0 149.4 149.5 149.6 150.1 150.9 149.8 150.6 152.2 7 Durable........ 51.98 129.5 123.4 124.0 126.8 131.3 131.7 132.4 132.7 133.4 130.9 131.9 134.3 Mining 8 Metal mining.................... 10 .51 105.4 130.6 128.5 133.8 70.0 71.4 80.0 84.8 104.3 121.4 120.2 9 Coal................................... 11,12 .69 118.0 95.3 100.8 124.1 113.6 133.0 141.4 140.6 74.6 54.8 56.5 78.6 10 Oil and gas extraction.... 13 4.40 118.0 112.0 115.8 117.5 119.3 119.6 119.4 117.8 118.4 119.3 119.7 122.4 11 Stone and earth minerals. 14 .75 124.9 121.6 124.9 126.1 125.0 126.7 128.1 127.2 126.5 130.0 129.3 Nondurable manufactures 12 Foods............................. 20 8.75 137.9 134.2 136.4 138.7 139.3 138.3 137.3 139.4 140.4 139.2 140.3 13 Tobacco products......... 21 .67 114.3 114.8 116.8 104.3 117.0 113.5 113.8 117.5 120.6 113.4 14 Textile mill products... 22 2.68 137.1 132.2 132.3 134.4 136.6 140.7 142.4 141.6 143.7 137.1 136.9 15 Apparel products.......... 23 3.31 124.2 123.0 124.4 122.2 124.1 127.7 129.0 125.1 125.8 118.6 16 Paper and products;... 26 3.21 137.4 130.6 136.5 135.5 140.3 139.1 137.9 137.8 138.6 139.9 ui'.i 143.2 17 Printing and publishing....... 27 4.72 124.7 124.7 122.4 124.8 125.0 124.2 125.7 126.2 127.5 129.1 128.8 130.2 18 Chemicals and products 28 7.74 180.7 172.2 174.9 180.0 182.6 181.3 182.3 183.1 183.0 184.6 184.0 19 Petroleum products............. 29 1.79 141.0 139.7 145.2 143.3 139.9 141.9 141.4 140.5 139.3 139.7 138.9 140.0 20 Rubber & plastic products. 30 2.24 232.2 218.9 220.3 225.6 237.4 239.5 236.3 238.5 240.1 238.7 240.5 21 Leather and products.......... 31 .86 75.3 74.8 75.0 73.8 74.5 74.0 77.0 78.1 77.3 74.5 74.5 Durable manufactures 22 Ordnance, pvt. & govt.... 19,91 3.64 73.9 72.6 72.6 72.8 75.5 75.1 74.4 74.1 73.8 72.6 72.0 72.3 23 Lumber and products........ 24 1.64 133.4 132.7 132.2 132.1 131.8 137.1 135.7 137.5 138.1 137.3 137.1 24 Furniture and fixtures........ 25 1.37 140.9 135.1 137.1 135.1 142.9 145.6 146.6 146.0 146.6 146.4 149.4 25 Clay, glass, stone products. 32 2.74 146.1 137.1 139.0 143.7 148.8 145.5 148.0 152.8 152.1 150.5 151.3 26 Primary metals................... 33 6.57 110.2 100.8 100.2 108.3 112.5 109.0 113.5 111.2 111.0 107.4 105.8 105.5 27 Iron and steel................. 331,2 4.21 103.4 89.7 91.3 97.9 110.6 104.6 107.7 104.3 103.8 99.5 96.6 28 Fabricated metal products. 34 5.93 130.9 125.7 125.8 127.5 134.0 133.6 133.8 135.8 136.4 136.9 136.5 \31 A 29 Nonelectrical machinery... 35 9.15 144.8 139.9 139.8 139.8 145.2 147.4 148.9 149.7 151.7 150.2 151.0 152.5 30 Electrical machinery.......... 36 8.05 141.9 134.0 137.6 137.6 143.9 144.6 144.2 146.0 147.3 144.0 147.3 149.2 31 Transportation equipment.................... 37 9.27 121.1 113.5 120.5 120.5 124.3 125.5 124.3 122.0 122.2 116.4 118.9 127.4 32 Motor vehicles & parts..................... 371 4.50 159.7 145.5 161.2 161.2 164.4 165.6 168.4 163.0 161.8 146.9 153.7 168.3 33 Aerospace & misc. tr. eq.................. 372-9 4.77 84.7 83.4 82.3 82.3 86.5 87.7 82.8 83.3 84.9 87.7 86.0 88.9 34 Instruments............................................ 38 2.11 159.1 153.7 157.0 156.9 158.3 160.3 162.2 163.1 164.7 163.4 164.2 166.7 35 Miscellaneous mfrs................................ 39 1.51 149.1 147.8 147.9 147.4 147.5 150.7 151.0 151.8 152.5 153.1 153.2 154.8 Gross value (billions of 1972 dollars, annual rates) MAJOR MARKET 36 Products, total............ 1507.4 583.9 564.8 569.4 578.2 590.2 590.1 591.3 591.3 594.7 580.9 591.6 601.8 37 Final products.......... i390.9 452.1 436.7 441.1 449.0 456.9 456.8 457.8 457.3 458.7 444.8 454.5 463.7 38 Consumer goods. *277.5 317.5 308.8 312.2 316.8 320.0 319.1 319.5 320.0 320.4 310.7 317.8 324.4 39 Equipment........... U13.4 134.6 127.9 128.9 132.1 137.0 137.6 138.1 137.3 138.2 134.0 137.1 139.6 40 Intermediate products. *116.6 131.9 128.2 128.4 129.1 133.1 133.5 133.8 134.1 135.9 136.2 137.0 138.3 1 1972 dollars. separately. For description and historical data, see Industrial Production— 1976 Revision (Board of Governors of the Federal Reserve System: Note.—Published groupings include some series and subtotals not shown Washington, D.C.), Dec. 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A50 Domestic Nonfinancial Statistics □ April 1978 2.14 HOUSING AND CONSTRUCTION Monthly figures are at seasonally adjusted annual rates. Exceptions noted. 1977 1978 Item 1975 1976 1977 Aug. Sept. Oct. Nov.' Dec.' Jan. Feb. Private residential real estate activity (thousands of units) NEW UNITS 927 1,296 18,133 1,772 1,695 1,850 1,893 1,811 1,496 1,622 2 1-family............................................ 669 894 12,265 1,156 1,135 1,216 1,257 1,210 1,027 967 3 2-or-more-family............................. 278 402 5,861 616 560 634 636 601 469 655 1,160 1,540 1,986 2,038 2,012 2,139 2,096 2,203 1,547 1,580 5 1-family........................................... 892 1,163 1,451 1,454 li, 508 1,532 1,544 1,574 1,153 1,091 268 377 535 584 r504 607 552 629 392 489 7 Under construction, end of period 1 1,003 1,147 1,442 T1,141 r1,149 r 1,189 1,211 1,252 1,272 531 655 829 r709 r708 '729 746 772 792 All 492 613 r431 r442 '460 466 481 480 1,297 1,362 1,652 '1,677 r 1,875 ' 1,665 1,769 1,630 1,721 1,026866 '1,216,92 54 '1,r2l4,94 58 1,280 1,288 1,261 430 336 398 r409 r417 '416 489 342 460 13 Mobile homes shipped....................... 213 250 613 270 300 319 318 324 322 269 Merchant builder activity in 1-family units: 14 Number sold....................................... 544 639 819 881 845 870 819 853 804 746 15 Number for sale, end of period1........ 383 433 407 389 389 398 401 403 403 405 Price (thous. of dollars)2 Median: 16 Units sold.................................... 39.3 44.2 48.9 49.0 48.5 51.4 51.8 52.7 51.8 53.3 17 Units for sale............................... 38.9 41.6 48.2 45.1 45.9 46.7 46.7 47.7 48.2 Average: 18 Units sold.................................... 42.5 48.1 54.4 54.3 53.9 57.2 57.8 57.6 58.5 59.6 EXISTING UNITS (1-family) 19 Number sold....................................... 2,452 3,002 3,572 3,720 3,880 3,930 4,160 4,140 3,780 3,460 Price of units sold (thous. of dollars):2 20 Median............................................ 35.3 38.1 42.9 43.9 43.8 44.0 44.5 44.2 45.5 46.3 21 Average........................................... 39.0 42.2 47.9 48.1 47.9 48.2 48.5 48.3 50.3 51.3 Value of new construction 4 (millions of dollars) CONSTRUCTION 22 Total put in place............................... 134,293 147,481 170,685 '172,414 '175,065 '174,409 173,104 176,734 171,249 178,148 23 Private................................................. 93,624 109,499 133,652 r134,186 r135,812 '136,710 137,464 140,468 137,312 143,849 24 Residential....................................... 46,472 60,519 81,067 r81,040 '81,677 '83,022 84,005 87,246 81,111 86,903 25 Nonresidential, total...................... 47,152 48,980 52,585 '53,146 r54,135 '53,688 53,459 53,222 56,201 56,946 Buildings: 26 Industrial................................. 8,017 7,182 7,182 7,646 7,484 7,579 7,716 7,132 7,484 7,602 27 Commercial............................. 12,804 12,757 14,604 15,257 16,054 15,846 15,404 14,627 14,986 14,961 28 Other........................................ 5,585 6,155 6,226 6,294 6,370 6,337 6,437 6,200 6,065 5,932 29 Public utilities and other............ 20,746 22,886 24,573 r23,949 '24,227 '23,926 23,902 25,263 27,666 28,451 30 Public.................................................. 40,669 37,982 37,033 38,228 39,253 37,699 35,641 36,266 33,937 34,299 31 Military............................................ 1,392 1,508 1,478 1,460 1,493 1,381 1,286 1,370 1,410 1,479 32 Highway.......................................... 10,861 9,756 9,170 9,449 8 915 9,507 8,281 7,877 7,006 33 Conservation and development... 3,256 3,722 3,765 4,120 4^910 3,141 3,464 3,851 3,900 34 Other 3.............................................. 25,160 22,996 22,620 23,199 23,925 23,670 22,610 23,168 21,621 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 Beginning Jan. 1977 Highway imputations are included in Other. factured Housing Institute and seasonally adjusted by the Census Bureau, 4 Value of new construction data in recent periods may not be strictly and (b) sales and prices of existing units, which are published by the comparable with data in prior periods due to changes by the Bureau of National Association of Realtors. All back and current figures are avail the Census in its estimating techniques. For a description of these changes able from originating agency. Permit authorizations are for 14,000 see Construction Reports (C-30-76-5), issued by the Bureau in July 1976. 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— Tndex level 1977 1977 1978 Feb. 1977 1978 1978 Feb. Feb. (1967 Mar. June Sept. Dec. Oct. Nov. Dec. Jan. Feb. = 100)3 Consumer prices4 1 All items........................................................ 6.0 6.4 7.1 8.9 6.1 4.7 .3 .4 .4 .8 .6 188.4 2 Commodities................................................. 5.3 5.4 7.1 8.6 4.6 3.7 .3 .5 .5 .9 .5 180.2 3 Food.......................................................... 4.3 7.6 7.7 13.4 6.6 3.0 .2 .5 .4 1.3 1.2 202.0 5.8 4.5 6.5 5.8 3.5 4.0 .4 .5 .5 .7 .2 168.8 7.0 4.7 7.3 6.3 2.5 3.3 .3 .4 .5 1.0 .7 167.2 6 Nondurable.......................................... 5.1 4.0 6.0 5.8 4.1 4.3 .5 .5 .3 .4 -.3 169.6 7 Services......................................................... 7.2 7.8 7.4 9.6 8.5 6.3 .4 .4 .4 .6 .7 203.5 5.7 6.3 6.1 6.6 6.5 6.5 .5 .6 .5 .6 .4 159.7 7.4 8.1 7.5 9.9 8.9 6.3 .3 .4 .4 .6 .8 211.4 Other groupings: 10 All items less food................................... 6.5 6.1 7.0 7.6 6.0 5.1 .3 .4 .4 .8 .5 184.7 11 All items less food and energy................ 6.3 6.2 6.4 7.7 6.0 5.2 .3 .4 .5 .9 .4 182.2 12 Homeo wnership....................................... 5.0 9.2 5.8 10.9 9.4 7.8 .3 .7 .7 1.0 .7 216.4 Wholesale prices 6.0 6.2 11.1 4.0 1.9 6.9 .6 .7 .4 .9 1.0 202.0 14 Farm products, and processed foods and feeds....................................................... 3.6 4.4 19.3 -3.1 -15.0 14.7 .9 2.3 .3 1.1 2.5 196.6 15 Farm products......................................... 4.4 -0.1 26.5 -20.3 -21.3 17.9 1.3 3.1 -.3 1.7 2.8 198.9 16 Processed foods and feeds....................... 3.1 7.0 15.6 8.2 -11.3 13.0 .7 1.8 .6 .8 2.3 194.6 17 Industrial commodities................................. 6.7 6.7 8.8 6.4 7.0 4.7 .5 .3 .5 .7 .7 202.8 Materials, supplies, and components of which: 18 Crude nonfood materials1................... 19.2 5.4 25.6 -8.1 -5.6 18.8 .7 1.9 1.8 1.4 1.0 269.7 19 Intermediate materials 2...................... 6.4 6.8 8.9 5.5 7.3 3.8 .3 .2 .4 .9 .8 210.1 Finished goods, excluding foods: 5.6 5.6 9.0 7.8 4.2 4.2 .3 .3 .3 .5 .3 177.7 21 Durable............................................. 4.3 6.0 7.0 6.9 5.4 5.6 .6 .3 .4 .7 .3 158.2 22 Nondurable....................................... 6.4 5.3 10.5 7.7 3.3 4.1 .2 .4 .4 .4 .3 190.6 23 Producer................................................ 6.0 7.4 5.0 6.8 6.0 10.5 1.3 .5 .6 .5 .7 193.6 Memo: 24 Consumer foods........................................... 2.7 7.7 17.9 4.3 -2.9 8.1 .3 1.2 .5 1.1 2.9 199.3 1 Excludes crude foodstuffs and feedstuffs. 3 Not seasonally adjusted. 2 Excludes intermediate materials for food manufacturing and manu- 4 Beginning January 1978 figures for consumer prices are those for all factured animal feeds. urban consumers. Source.—Bureau of Labor Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A52 Domestic Nonfinancial Statistics □ April 1978 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates. 1976 1977 Account 1975 1976 1977 r Q3 Q4 Ql Q2 Q3 Q4r Gross national product 1 1,528.8 1,706.5 1,889.6 1,727.3 1,755.4 1,810.8 1,869.9 1,915.9 1,961.8 By source: 2 Personal consumption expenditures........................ 980.4 1,094.0 1,277.2 1,102.2 1,159.0 1,172.4 1,194.0 1,218.9 1,259.5 3 132.9 158.9 179.8 159.3 166.3 177.0 178.6 177.6 186.0 4 409.3 442.7 480.7 444.7 458.8 466.6 474.4 481.8 499.9 5 Services.......................................................... 438.2 492.3 550.7 498.2 513.9 528.8 541.1 559.5 573.7 6 Gross private domestic investment.......................... 189.1 243.3 294.2 254.3 243.4 271.8 294.9 303.6 306.7 7 Fixed investment........................................... 200.6 230.0 276.1 232.8 244.3 258.0 273.2 280.0 293.2 8 Nonresidential......................................................... 149.1 161.9 185.1 164.9 167.6 177.0 182.4 187.5 193.5 9 52.9 55.8 61.5 56.0 57.0 57.9 61.0 62.6 64.5 10 Producers’ durable equipment.............. 96.3 106.1 123.6 109.0 110.6 119.2 121.4 124.9 129.0 11 Residential structures............................... 51.5 68.0 91.0 67.8 76.7 81.0 90.8 92.5 99.7 12 Nonfarm................................................ 49.5 65.7 88.4 65.7 74.3 78.5 88.2 89.9 97.1 13 Change in business inventories.................... -11.5 13.3 18.2 21.5 -.9 13.8 21.7 23.6 13.5 14 Nonfarm.................................................... -15.1 14.9 17.1 22.0 1.4 14.1 22.4 23.1 9.0 15 Net exports of goods and services........................... 2.0 7.8 -10.9 7.9 3.0 -8.2 -9.7 — 7.5 -18.2 16 Exports.......................................................... 147.3 162.9 174.7 168.4 168.5 170.4 178.1 179.9 170.6 17 126.9 155.1 185.6 160.6 165.6 178.6 187.7 187.4 188.8 18 Govt. purchases of goods and services.................. 338.9 361.4 395.0 363.0 370.0 374.9 390.6 400.9 413.8 19 123.3 130.1 145.4 130.2 134.2 136.3 143.6 148.1 153.8 20 State and local.............................................. 215.6 231.2 249.6 232.7 235.8 238.5 247.0 252.9 260.0 By major type of product: 21 1,540.3 1,693.1 1,871.4 1,705.8 1,756.3 1,797.0 1,848.2 1,892.2 1,948.2 22 Goods................................................................................ 686.2 764.2 834.7 746.0 774.7 805.9 827.1 843.5 862.5 23 Durable goods........................................... 258.2 303.4 341.3 313.4 312.6 334.4 341.0 342.3 347.6 24 Nondurable................................................ 428.0 460.9 493.4 464.1 460.6 471.5 486.1 501.2 514.9 25 699.2 782.0 867.4 791.8 813.8 833.7 855.3 881.6 898.8 26 143.5 160.2 187.5 159.6 166.9 171.2 187.5 190.7 200.4 27 -11.5 13.3 18.2 21.5 -.9 13.8 21.7 23.6 13.5 28 -9.2 4.1 9.1 10.7 .6 7.8 11.5 10.3 6.8 29 Nondurable goods........................................ -2.2 9.3 9.1 12.4 -3.1 6.0 10.2 13.4 6.8 30 1,202.1 1,274.7 1,337.3 1,283.7 1,287.4 1,311.0 1,330.7 1,347.4 1,360.2 National income 31 1,217.0 1,364.1 1,520.5 1,379.6 1,402.1 1,450.2 1,505.7 1,540.5 1,585.4 930.3 1,036.3 1,156.3 1,046.5 1,074.2 1,109.9 1,144.7 1,167.4 1,203.3 33 805.7 891.8 990.0 900.2 923.2 951.3 980.9 998.9 1,029.1 34 Government and Government enterprises.. 175.4 187.2 199.9 188.2 192.5 194.8 197.2 200.6 206.9 35 630.3 704.6 790.1 712.0 730.7 756.4 783.6 798.3 822.2 36 Supplement to wages and salaries........................... 124.6 144.5 166.3 146.3 150.9 158.6 163.8 168.5 174.3 37 Employer contributions for social 59.8 68.6 77.7 69.1 70.9 75.4 77.1 78.2 80.2 38 64.9 75.9 88.6 77.3 80.0 83.2 86.7 90.3 94.0 86.0 88.0 98.2 86.2 88.7 95.1 97.0 95.5 705.0 40 Business and professional1............................... 62.8 69.4 78.5 70.0 72.0 74.3 77.3 80.0 82.4 41 23.2 18.6 19.7 16.2 16.6 20.7 19.7 15.5 22.7 42 Rental income of persons2................................... 22.3 23.3 25.3 23.3 24.1 24.5 24.9 25.5 26.4 43 Corporate profits1................................................ 99.3 128.1 139.8 133.5 123.1 125.4 140.2 149.0 144.5 44 123.5 156.9 171.6 159.9 154.8 161.7 174.0 172.8 178.0 45 Inventory valuation adjustment....................... -12.0 -14.1 -14.6 -11.7 -16.9 -20.6 -17.8 -5.9 -14.1 46 Capital consumption adjustment..................... -12.2 -14.7 -17.2 -14.7 -14.8 -15.6 -15.9 -17.9 -19.4 47 Net interest............................................................ 79.1 88.4 100.9 90.1 92.0 95.3 98.9 103.1 106.1 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. 1976 1977 1975 1976 1977' Account Q3 Q4 Ql Q2 Q3 Q4r Personal income and saving 1 Total personal income. 1.253.4 1.382.7 1.536.7 1.393.9 1.432.2 1.476.8 1.517.2 1.549.8 1.603.0 2 Wage and salary disbursements....................... 805.7 891.8 990.0 900.2 923.2 951.3 980.9 998.9 1.029.1 3 Commodity-producing industries.............. 275.0 308.4 346.4 310.8 317.7 328.9 345.4 351.0 360.2 4 Manufacturing........................................ 211.0 238.2 267.3 240.2 245.1 255.4 265.9 270.0 278.0 5 Distributive industries................................ 195.4 217.1 242.8 220.2 226.4 234.5 240.5 244.4 251.8 6 Service industries........................................ 159.9 179.0 200.9 180.9 186.7 193.0 197.7 202.8 210.2 7 Government and government enterprises., 175.4 187.2 199.9 188.2 192.5 194.8 197.2 200.6 206.9 8 Other labor income........................................ 64.9 75.9 88.6 77.3 80.0 83.2 86.7 90.3 94.0 9 Proprietors' income1............. 86.0 88.0 98.2 86.2 88.7 95.1 97.0 95.5 105.0 10 Business and professional1 62.8 69.4 78.5 70.0 72.0 74.3 77.3 80.0 82.4 11 Farm1............................... 23.2 18.6 19.7 16.2 16.6 20.7 19.7 15.5 22.7 12 Rental income of persons2. 22.3 23.3 25.3 23.3 24.1 24.5 24.9 25.5 26.4 13 Dividends........................... 32.4 35.8 41.2 36.0 38.4 38.5 40.3 42.3 43.6 14 Personal interest income... 115.6 130.3 147.8 132.2 136.4 140.3 145.4 150.3 155.2 15 Transfer payments........................................ 176.8 192.8 206.9 194.3 198.0 203.5 203.0 208.7 212.6 16 Old-age survivors, disability, and health insurance benefits............................... 81.4 92.9 105.0 95.8 98.4 99.9 101.8 108.5 110.2 17 Less: Personal contributions for social insurance........................................... 50.4 55.2 61.3 55.6 56.6 59.6 60.8 61.7 62.9 18 Equals: Personal income................................ 1.253.4 1.382.7 1.536.7 1.393.9 1.432.2 1.476.8 1.517.2 1.549.8 1,603.0 19 Less: Personal tax and nontax payments.. 169.0 196.9 227.5 200.6 209.5 224.4 224.8 226.1 234.7 20 Equals: Disposable personal income............ 1.084.4 1.185.8 1,309.2 1,193.3 1,222.6 1,252.4 1,292.5 1.323.8 1,368.3 21 Less: Personal outlays................................. 1,004.2 1.119.9 1,241.9 1,128.5 1.166.3 1,201.0 1,223.9 1,250.5 1.292.2 22 Equals: Personal saving................................. 80.2 65.9 67.3 64.8 56.3 51.4 68.5 73.3 76.1 Memo items : Per capita (1972 dollars): 23 Gross national product..................... 5.629 5,924 6,167 5,961 5,966 6,064 6,143 6,206 6,254 24 Personal consumption expenditures. 3.629 3,817 3,971 3,820 3,892 3,934 3,943 3,963 4,045 25 Disposable personal income............. 4,014 4,137 4,293 4,135 4,177 4,202 4,268 4,305 4,394 26 Saving rate (per cent)............................ 7.4 5.6 5.1 5.4 4.6 4.1 5.3 5.5 5.6 Gross saving 27 Gross private saving.............................................. 259.4 272.5 293.8 277.2 261.6 262.9 292.1 310.5 309.8 28 Personal saving.................................................. 80.2 65.9 67.3 64.8 56.3 51.4 68.5 73.3 76.1 29 Undistributed corporate profits1..................... 16.7 27.6 29.5 31.6 20.8 22.5 30.3 37.4 27.8 30 Corporate inventory valuation adjustment.... -12.0 -14.1 -14.6 -11.7 -16.9 -20.6 -17.8 -5.9 -14.1 Capital consumption allowances: 31 Corporate...................................................... 101.7 111.8 121.9 112.9 115.2 117.6 119.4 123.7 127.0 32 Noncorporate................................................ 60.8 67.2 75.1 68.0 69.2 71.4 73.8 76.2 78.9 33 Wage accruals less disbursements................... 34 Government surplus, or deficit (—), national income and product accounts......................... -64.3 -35.6 -20.3 -32.4 -29.4 -11.5 -14.9 -26.0 -29.0 35 Federal.............................................................. -70.2 -54.0 -49.5 -53.5 -55.9 -38.8 -40.3 -58.9 -60.1 36 State and local.................................................. 5.9 18.4 29.2 21.1 26.5 27.3 25.4 32.9 31.1 37 Capital grants received by the United States, net.................................................................. 38 Investment............................................................. 201.0 242.5 273.3 252.8 237.5 254.7 276.1 285.4 277.2 39 Gross private domestic..................................... 189.1 243.3 294.2 254.1 243.3 271.8 294.9 303.6 306.7 40 Net foreign........................................................ 11.8 -.9 -20.9 -1.5 -5.9 -17.1 -18.8 -18.2 -29.5 41 Statistical discrepancy.......................................... 5.9 5.5 -.2 8.0 5.3 3.3 -1.2 .9 -3.6 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 □ April 1978 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data are seasonally adjusted except as noted.1 1976 1977 Item credits or debits 1975 1976 1977 Q3 Q4 Ql' Q2r Q3r Q4 1 Merchandise exports................. 107,088 114,694 120,472 29,603 29,711 29,457 30,655 30,870 29,490 2 Merchandise imports................. 98,043 124,014 151,713 32,411 33,305 36,606 38,309 38,429 38,369 3 Merchandise trade balance 2. 9,045 -9,320 -31,241 -2,808 -3,594 -7,149 -7,654 -7,559 -8,879 4 Military transactions, net........ -876 366 1,432 235 235 514 309 559 50 5 Investment income, net............ 5,954 9,808 11,935 2,667 2,424 3,187 3,439 3,166 2,143 6 Other service transactions, net. 2,042 2,743 2,460 781 598 330 546 845 740 7 Balance on goods and services 3 16,164 3,596 -15,414 875 -337 -3,118 -3,360 -2,989 -5,946 8 Remittances, pensions, and other transfers. -1,719 -1,878 -2,008 -461 -473 -526 -492 -510 -480 9 U.S. Govt, grants (excluding military)........ -2,893 -3,146 -2,787 -1,475 -572 -637 -723 -824 -604 10 Balance on current account. 11,552 -1,427 -20,209 -1,061 -1,382 -4,281 -4,575 -4,323 -7,030 11 Not seasonally adjusted. . -3,809 303 -3,404 -4,667 -6,844 -5,294 12 Change in U.S. Govt, assets, other than official reserve assets, net (increase, —)................................................. -3,463 -4,213 -3,666 -1,405 -1,142 -909 -825 -1,169 -763 13 Change in U.S. official reserve assets (increase, —)............. -607 -2,530 -231 —407 228 -388 6 151 14 Gold.................................................................................... -118 -58 -60 15 Special Drawing Rights (SDR’s)...................................... -66 -78 -121 -18 -29 -83 -9 -29 16 Reserve position in International Monetary Fund (IMF). -466 -2,212 -294 -716 -461 -389 -80 133 42 17 Foreign currencies............................................................. -75 -240 302 327 718 59 169 27 47 18 Change in U.S. private assets abroad (increase, —). -27,478 -36,216 -22,162 -6,597 -13,108 1,627 -9,464 -3,405 -10,921 19 Bank-reported claims. -13,532 -20,904 -11,694 -3,372 -9,148 3,446 -4,553 - 1,709 -8,878 20 Long-term.............. -2,357 -2,124 -741 -978 -480 -306 23 -445 -13 21 Short-term............. -11,175 -18,780 -10,953 -2,394 -8,668 3,752 -4,576 -1,264 -8,865 22 Nonbank-reported claims.................................................. -1,447 -1,986 -96 723 -967 — 722 -1,129 1,518 237 23 Long-term..................................................................... -432 10 350 66 -10 45 68 240 -3 24 Short-term..................................................................... -1,015 -1,996 -446 657 -957 -767 -1,197 1,278 240 25 U.S. purchase of foreign securities, net......................... -6,235 -8,730 -5,362 -2,743 -2,171 -692 -1,784 -2,156 -731 26 U.S. direct investments abroad, net............................... -6,264 -4,596 -5,009 -1,205 -822 -404 -1,998 -1,058 -1,549 27 Change in foreign official assets in the United States (in crease, +)..................................................................... 6,960 17,945 37,419 3,070 6,977 5,7/9 7,908 8,249 15,542 28 U.S. Treasury securities................................................... 4,408 9,333 30,091 1,260 3,909 5,149 5,124 6,950 12,868 29 Other U.S. Govt, obligations.......................................... 905 566 2,310 66 116 100 609 627 974 30 Other U.S. Govt, liabilities 4.......................................... 1,701 4,938 1,874 1,819 852 712 456 321 385 31 Other U.S. liabilities reported by U.S. banks............... -2,158 893 1,126 -599 1,769 -420 752 -150 944 32 Other foreign official assets 5.......................................... 2,104 2,215 2,018 524 331 178 967 501 372 33 Change in foreign private assets in the United States (in crease, +)....................................................................... 7,376 16,575 11,842 5,131 5,102 -3,209 5,873 5,671 3,508 34 U.S. bank-reported liabilities............................................. 628 10,982 6,751 1,774 5,008 -5,298 6,344 2,656 3,049 35 Long-term............................................................................. -280 175 366 75 221 47 105 194 20 36 Short-term....................................................................... 908 10,807 6,385 1,699 4,787 -5,345 6,239 2,462 3,029 37 U.S. nonbank-reported liabilities....................................... 240 -616 2 -297 -242 —374 -405 629 152 38 Long-term....................................................................... 334 -947 -448 -241 -311 -229 -183 56 -92 39 Short-term...................................................................... -94 331 450 -56 69 -145 -222 573 244 40 Foreign private purchases of U.S. Treasury securities, net............................................................................... 2,590 2,783 628 3,026 1,047 -1,370 1,250 -299 41 Foreign purchases of other U.S. securities, net............... 2,503 1,250 2,934 68 21 879 736 516 803 42 Foreign direct investments in the United States, net 1,414 2,176 1,527 561 403 537 568 619 -197 43 Allocation of SDR’s............................................................. 44 Discrepancy............................................................................ 5.660 9.866 -2,993 1,268 3,325 1,440 1,077 -5,173 -337 45 Owing to seasonal adjustments........................................ -2,622 1,780 652 -90 -2,388 1,826 46 Statistical discrepancy in recorded data before seasonal adjustment.................................................................... 5.660 9.866 -2,993 3,890 1,545 788 1,167 -2,785 -2,163 Memo items :............................................................................................... Changes in official assets: 47 U.S. official reserve assets (increase, —)......................... -607 -2,530 -231 -407 228 -388 6 151 48 Foreign official assets in the United States (increase, +) 5,259 13,007 35,545 1,251 6,125 5,007 7,452 7,928 15,157 49 Changes in Organization of Petroleum Exporting Coun tries (OPEC) official assets in the United States (part of line 27 above)......................................................... 7,092 9,324 6,758 1,774 805 3,249 1,073 1,438 998 50 Transfers under military grant programs (excluded from lines 1, 4, and 9 above)................................................ 2,217 386 195 156 94 46 27 32 90 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 Assets A55 3.11 U.S. FOREIGN TRADE Millions of dollars; monthly data are seasonally adjusted. 1977 1978 Item 1975 1976 »• 1977 ' Aug. Sept. Oct. Nov. Dec. Jan. Feb. 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments........................................ 107,130 114,802 121,144 9,674 11,037 9,375 9,475 11,007 10,014 9,922 2 GENERAL IMPORTS including merchandise for immediate con sumption plus entries into bonded warehouses...................................... 96,115 120,678 147,696 11,651 12,605 12,996 11,833 13,123 12,393 14,439 3 Trade balance...................................... 11,014 -5,876 -26,552 -1,977 -1,569 -3,621 -2,358 -2,116 -2,379 -4,516 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. Effective January 1978, major changes were made in reported separately in the “service account”). On the import side, the coverage, reporting, and compiling procedures. Data for 1977 reflect largest single adjustment is the addition of imports into the Virgin Islands these changes. However, the quarterly intemational-accounts-basis data (largely oil for a refinery on St. Croix), which are not included in Census in Table 3.10 will not incorporate the 1977 revisions until June. The latter statistics. data 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.—FT 900 “Summary of U.S. Export and Import Merchandise Canada not covered in Census statistics, and (b) the exclusion of military Trade” (U.S. Dept, of Commerce, Bureau of the Census). 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period 1977 1978 Type 1974 1975 1976 Sept. Oct. Nov. Dec. Jan. Feb. Mar.p 1 Total.................................................... 15,883 16,226 18,747 18,988 19,048 19,155 19,317 19,454 19,373 3 19,192 2 Gold stock, including Exchange Stabilization Fund1........................ 11,652 11,599 11,598 11,658 11,658 11,658 11,719 11,718 11,718 11,718 3 Special Drawing Rights2................... 2,374 2,335 2,395 2,489 2,530 2,548 2,629 2,629 2,671 3 2,693 4 Reserve position in International Monetary Fund............................... 1,852 2,212 4,434 4,776 4,842 4,933 4,951 4,934 4,966 3 4,701 5 Convertible foreign currencies.......... 5 80 320 65 18 16 18 173 18 80 1 Gold held under earmark at F.R. Banks for foreign and international SDR based on a weighted average of exchange rates for the currencies accounts is not included in the gold stock of the United States; see Table of 16 member countries. The U.S. SDR holdings and reserve position in 3.24. the IMF also are valued on this basis beginning July 1974. At valuation 2 Includes allocations by the International Monetary Fund (IMF) of used prior to July 1974 (SDR1 = $1.20635) total U.S. reserve assets SDR’s as follows: $867 million on Jan. 1, 1970; $717 million on Jan. 1, at end of Mar. amounted to $18,891; SDR holdings, $2,627, and reserve 1971; and $710 million on Jan. 1, 1972; plus net transactions in SDR’s. position in IMF, $4,466. 3 Beginning July 1974, the IMF adopted a technique for valuing the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A56 International Statistics □ April 1978 3.13 SELECTED U.S. LIABILITIES TO FOREIGNERS Millions of dollars, end of period 1977 1978 Holder, and type of liability 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan.? Feb.p 1 Total................... 119,164 126,552 151,356 166,342 174,709 178,937 184,720 192,270 194,028 197,246 2 Foreign countries. 115,842 120,929 142,873 159,186 167,295 171,541 177,087 184,625 186,330 189,639 3 Official institutions1............................ 76,823 80,712 91,975 108,137 111,208 117,057 123,142 126,032 129,773 132,630 4 Short-term, reported by banks in the United States.2................. 53,079 49,530 53,619 56,810 56,805 59,835 62,214 64,527 66,492 70,465 U.S. Treasury bonds and notes: 5 Marketable 3................................ 5,059 6,671 11,788 23,088 25,581 28,633 31,519 32,116 33,830 33,554 6 Nonmarketable4......................... 16,339 19,976 20.648 20,655 21,128 20,351 20,462 20,443 20,473 19,602 7 Other readily marketable liabilities5............................. 2,346 4,535 5,920 7,584 7,694 8,238 8,947 8,946 8,978 9,009 Commercial banks abroad: 8 Short-term, reported by banks in the United States2,6................ 30,106 29,516 37,329 35,800 40,414 38,755 37,981 42,510 40,354 40,639 9 Other foreigners.................................. 8,913 10,701 13,569 15,249 15,673 15,729 15,964 16,083 16,203 16,370 10 Short-term, reported by banks in the United States2.................. 8,415 10,000 12,592 13,693 14,046 14,038 14,196 14,325 14,385 14,444 11 Marketable U.S. Treasury bonds and notes3,7........................... 498 701 977 1,556 1,627 1,691 1,768 1,758 1,818 1,926 12 Nonmonetary international and regional organization 8................ 3,322 5,623 8,483 7,156 7,414 7.396 7,633 7,645 7,698 7,607 13 Short-term, reported by banks in the United States2................ 3,171 5,292 5,450 4,216 3,555 3.396 3,258 2,898 3,245 2,706 14 Marketable U.S. Treasury bonds and notes 3.............................. 151 331 3,033 2,940 3,859 4,000 4,375 4,746 4,453 4,901 _________________ 1 Includes Bank for International Settlements. 8 Principally the International Bank for Reconstruction and Develop 2 Includes Treasury bills as shown in Table 3.15. ment and the Inter-American and Asian Development Banks. 3 Derived by applying reported transactions to benchmark data. 4 Excludes notes issued to foreign official nonreserve agencies. Note.—Based on Treasury Dept, data and on data reported to the 5 Includes long-term liabilities reported by banks in the United States Treasury Dept, by banks (including Federal Reserve banks) and brokers and debt securities of U.S. Federally sponsored agencies and U.S. cor in the United States. Data exclude the holdings of dollars of the Inter porations. national Monetary Fund derived from payments of the U.S. subscription, 6 Includes short-term liabilities payable in foreign currencies to com and from the exchange transactions and other operations of the IMF. mercial banks abroad and to other foreigners. Data also exclude U.S. Treasury letters of credit and nonnegotiable, non- 7 Includes marketable U.S. Treasury bonds and notes held by com interest-bearing special U.S. notes held by nonmonetary international mercial banks abroad and other foreigners. and regional organizations. 3.14 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1977 1978 Area 1974 1975 1976 Aug. Sept. Oct. Nov Dec. Jan .p Feb.p 1Total.................................................... 76,823 80,712 91,975 108,137 111,208 117,057 123,142 126,032 129,773 132,630 2 Western Europe 1........................... 44,328 45,701 45,882 57,743 60,724 65,039 68,147 70,707 72,532 74,397 3 Canada............................................ 3,662 3,132 3,406 2,557 2,508 1,863 1,919 2,334 2,078 1,389 4 Latin American republics............... 4,419 4,450 4,906 4,246 4,466 4,269 4,843 4,633 4,562 5,103 5 Asia.................................................. 18,627 22,551 34,108 40,440 40,333 42,700 45,450 45,676 48,096 49,139 6 Africa.............................................. 3,160 2,983 1,893 2,265 2,144 2,027 1,792 1,742 1,706 1,899 7 Other countries 2............................ 2,627 1,895 1,780 886 1,033 1,159 991 940 799 703 1 Includes Bank for International Settlements. Note.—Data represent breakdown by area of line 3, Table 3.13. 2 Includes countries in Oceania and Eastern Europe, and Western European dependencies in Latin America. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Bank-reported Data 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 1977 1978 Holder, and type of liability 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan.p Feb.* 1 All foreigners, excluding the International 94,771 94,338 108,990 110,519 114,820 116,024 117,649 124,260 124,476 128,254 2 Payable in dollars............................................... 94,004 93,781 108,266 109,630 114,075 115,260 116,817 123,449 123,759 127,481 Deposits: 3 Demand...................................................... 14,051 13,564 16,803 15,942 16,893 16,895 16,461 18,967 17,378 17,674 4 Time1.......................................................... 9,907 10,250 11,316 11,756 11,601 11,515 11,372 11,521 11,511 12,109 5 U.S. Treasury bills and certificates2............. 35,662 37,414 40,744 42,254 43,207 44,700 47,130 48,906 51,076 54,306 6 Other short-term liabilities3.......................... 34,384 32,552 39,403 39,678 42,373 42,150 41,854 44,054 43,794 43,393 7 Payable in foreign currencies............................. 766 558 724 889 745 764 832 812 717 772 8 Nonmonetary international and regional 3,171 5,293 5,450 4,216 3,555 3,396 3,258 2,899 3,245 2,705 9 Payable in dollars............................................... 3,171 5,284 5,445 4,178 3,523 3,376 3,237 2,889 3,234 2,696 Deposits: 10 Demand...................................................... 139 139 290 142 214 173 173 231 186 180 11 Time1.......................................................... 111 148 205 147 134 140 142 139 126 131 12 U.S. Treasury bills and certificates............... 497 2,554 2,701 1,990 1,875 802 767 706 959 1,111 13 Other short-term liabilities5.......................... 2,424 2,443 2,250 1,900 1,300 2,261 2,155 1,813 1,963 1,275 14 Payable in foreign currencies............................. 8 5 38 32 20 20 11 11 9 15 Official institutions, banks, and other foreigners.. 91,600 89,046 103,540 106,303 111,265 112,628 114,391 121,361 121,231 125,548 16 Payable in dollars............................................... 90,834 88,496 102,821 105,451 110,552 111,884 113,579 120,560 120,525 124,785 Deposits: 17 Demand...................................................... 13,912 13,426 16,513 15,801 16,679 16,722 16,288 18,736 17,192 17,494 18 Time1.......................................................... 9,796 10,119 11,142 11,609 11,468 11,375 11,229 11,382 11,385 11,978 19 U.S. Treasury bills and certificates2............. 35,165 34,860 38,042 40,264 41,331 43,898 46,364 48,200 50,117 53,195 20 Other short-term liabilities3.......................... 31,961 30,092 37,123 37,778 41,073 39,889 39,699 42,242 41,831 42,118 21 Payable in foreign currencies............................. 766 549 719 851 713 744 812 801 706 763 22 Official institutions6............................................... 53,079 49,530 53,619 56,810 56,805 59,835 62,214 64,527 66,492 70,465 23 Payable in dollars............................................... 52,952 49,530 53,619 56,810 56,805 59,835 62,214 64,527 66,492 70,465 Deposits: 24 Demand...................................................... 2,951 2,644 3,394 3,122 3,133 2,990 2,557 3,528 2,672 2,782 25 4,167 3,423 2,321 2,248 1,987 1,903 1,848 1,797 1,771 2,572 26 34,656 34,199 37,725 39,825 40,802 43,424 45,849 47,820 49,734 52,689 27 Other short-term liabilities5.......................... 11,178 9,264 10,179 11,615 10,882 11,518 11,960 11,382 12,315 12,422 28 Pavahle in fnreien currencies............................. 127 29 Banks and other foreigners.................................... 38,520 39,515 49,921 49,493 54,461 52,793 52,177 56,834 54,739 55,084 30 37,881 38,966 49,202 48,642 53,747 52,049 51,365 56,033 54,033 54,320 31 Banks7............................................................ 29,467 28,966 36,610 34,948 39,701 38,011 37,169 41,708 39,648 39,876 Deposits: 32 Demand.................................................. 8,231 7,534 9,104 8,928 9,676 9,677 9,666 10,933 10,274 10,569 33 Time1...................................................... 1,885 1,873 2,297 1,863 1,842 1,858 1,805 2,040 2,015 1,881 34 U.S. Treasury bills and certificates........... 232 335 119 112 125 111 141 141 152 239 35 Other short-term liabilities3...................... 19,119 19,224 25,089 24,046 28,057 26,349 25,557 28,595 27,207 27,187 36 8,414 10,000 12,592 13,693 14,046 14,037 14,196 14,325 14,385 14,445 Deposits: 37 2,729 3,248 4,015 3,751 3,870 4,055 4,065 4,275 4,245 4,143 38 Time1.................................................... 3,744 4,823 6,524 7,499 7,638 7,614 7,576 7,546 7,599 7,525 39 277 325 198 328 404 346 373 240 231 268 40 Other short-term liabilities5...................... 1,664 1,604 1,854 2,116 2,133 2,022 2,182 2,265 2,310 2,509 41 Payable in foreign currencies............................. 639 549 719 851 713 744 812 801 706 763 1 Excludes negotiable time certificates of deposit, which are included 4 Principally the International Bank for Reconstruction and Develop in "Other short-term liabilities.” ment, and the Inter-American and Asian Development Banks. 2 Includes nonmarketable certificates of indebtedness and Treasury 5 Principally bankers acceptances, commercial paper, and negotiable bills issued to official institutions of foreign countries. time certificates of deposit. 3 Includes liabilities of U.S. banks to their foreign branches, liabilities 6 Foreign central banks and foreign central governments and their of U.S. agencies and branches of foreign banks to their head offices and agencies, and Bank for International Settlements. foreign branches of their head offices, bankers acceptances, commercial 7 Excludes central banks, which are included in “Official institutions.” paper, and negotiable time certificates of deposit. Note.—“Short-term obligations” are those payable on demand, or having an original maturity of 1 year or less. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A58 International Statistics □ April 1978 3.16 SHORT-TERM LIABILITIES TO FOREIGNERS Reported by Banks in the United States By Country Millions of dollars, end of period 1977 1978 Area and country 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan.P Feb.P 1 94,771 94,338 108,990 110,519 114,820 116,024 117,649 124,260 124,476 128,254 2 Foreign countries.................................................... 91,600 89,046 103,540 106,303 111,265 112,628 114,391 121,361 121,231 125,548 3 48,813 43,988 46,938 48,953 51,457 52,910 54,369 60,052 59,406 60,798 4 607 754 348 498 448 410 375 319 302 302 5 Belgium-Luxembourg.................................... 2,506 2,898 2,275 2,691 2,667 2,736 2,662 2,547 2,680 2,797 6 369 332 363 1,032 1,172 1,250 1,264 771 1,045 1,051 7 266 391 422 217 248 232 263 330 302 315 8 France............................................................. 4,287 7,733 4,875 4,894 4,799 5,006 4,683 5,248 5,145 4,660 9 Germany......................................................... 9,429 4,357 5,965 4,413 4,289 5,280 5,580 7,030 8,595 10,366 10 248 284 403 709 629 648 643 603 538 547 11 Italy................................................................. 2,577 1,072 3,206 5,538 5,792 6,320 6,778 6,862 6,207 5,952 12 Netherlands.................................................... 3,234 3,411 3,007 3,328 3,216 3,088 2,996 2,876 2,951 3,050 13 1,040 996 785 1,140 1,190 1,023 641 949 988 890 14 310 195 239 169 173 191 266 273 205 188 15 382 426 561 543 723 724 647 609 703 645 16 Sweden............................................................ 1,138 2,286 1,693 1,782 2,483 2,734 3,136 2,718 2,718 2,832 17 10,139 8,514 9,458 9,386 9,923 9,757 9,884 12,390 12,106 12,748 18 152 118 166 203 93 106 118 130 187 172 19 7,584 6,886 10,004 10,226 11,427 11,096 12,119 14,035 12,484 11,856 20 183 126 188 110 119 130 171 232 219 195 21 4,073 2,970 2,672 1,855 1,839 1,948 1,910 1,799 1,781 1,955 22 U.S.S.R........................................................... 82 40 51 70 53 68 66 99 68 98 23 206 200 255 151 173 162 167 234 184 178 24 Canada................................................................ 3,520 3,076 4,784 4,631 4,492 4,913 4,686 4,668 5,343 4,780 25 Latin America.................................................... 11,754 14,942 19,026 21,428 24,478 22,354 22,417 23,575 23,143 24,157 26 Argentina........................................................ 886 1,147 1,538 2,022 2,187 2,421 2,594 1,466 1,796 1,978 27 1,054 1,827 2,750 4,283 5,940 3,769 3,409 3,534 3,074 3,684 28 1,034 1,227 1,432 1,233 1,101 1,055 935 1,389 1,106 970 29 Chile.............................................................. 276 317 335 353 342 340 322 359 386 411 30 305 417 1,017 1,164 1,156 1,182 1,152 1,213 1,219 1,200 31 7 6 6 6 6 6 6 6 6 7 32 Mexico............................................................ 1,770 2,066 2,848 2,806 2,823 2,741 2,850 2,802 2,906 3,002 33 Panama........................................................... 510 1,099 1,140 954 947 946 986 2,302 2,171 2,101 34 Peru................................................................. 272 244 257 273 288 259 235 286 264 266 35 165 172 245 230 245 226 258 242 229 279 36 3,413 3,289 3,095 2,887 3,037 3,212 3,780 2,913 3,001 3,231 37 Other Latin American republics................... 1,316 1,494 2,081 2,154 2,320 2,199 2,140 2,473 2,369 2,493 38 Netherlands Antilles2.................................... 158 129 140 180 169 156 184 188 187 185 39 Other Latin America..................................... 589 1,507 2,142 2,886 3,916 3,840 3,566 4,401 4,429 4,352 40 Asia..................................................................... 21,130 21,539 28,472 26,935 26,463 28,165 28,948 29,219 29,703 32,149 41 China, People’s Republic of (Mainland).... 50 123 47 46 44 48 52 53 54 48 42 818 1,025 989 925 924 899 926 1,012 1,048 994 43 Hong Kong.................................................... 530 623 892 1,066 1,153 993 971 1,091 1,033 1,118 44 India................................................................ 261 126 648 743 850 886 980 975 1,025 1,011 45 Indonesia........................................................ 1,221 369 340 589 453 905 739 406 892 502 46 389 386 391 467 416 465 490 558 490 453 47 Japan............................................................... 10,931 10,218 14,380 11,695 11,444 13,272 14,835 14,634 14,473 17,043 48 Korea.............................................................. 384 390 437 527 600 596 572 601 606 737 49 Philippines...................................................... 747 698 627 561 559 630 603 696 668 616 50 333 252 275 293 264 271 251 262 256 307 51 Middle East oil-exporting countries3........... 4,623 6,461 8,073 8,828 8,527 7,933 7,365 7,679 7,980 8,127 52 845 867 1,372 1,195 1,230 1,267 1,164 1,252 1,178 1,192 53 3,551 3,373 2,300 3,177 3,023 2,786 2,560 2,532 2,503 2,643 54 Egypt............................................................... 103 343 333 603 484 393 331 404 346 357 55 Morocco......................................................... 38 68 88 61 68 61 31 66 100 79 56 South Africa................................................... 130 169 143 185 208 232 240 175 192 252 57 84 63 35 38 36 33 30 39 41 50 58 Oil-exporting countries4................................ 2,814 2,239 1,116 1,430 1,564 1,403 1,214 1,154 1,178 1,264 59 383 491 585 860 664 664 715 694 645 640 60 Other countries................................................... 2,831 2,128 2,019 1,179 1,352 1,500 1,411 1,314 1,133 1,022 61 2,742 2,014 1,911 1,007 1,206 1,348 1,269 1,154 937 875 62 All other......................................................... 89 114 108 172 146 152 142 161 195 147 63 Nonmonetary international and regional 3,171 5,293 5,450 4,216 3,555 3,396 3,258 2,899 3,245 2,705 64 2,900 5,064 5,091 3,820 3,186 3,079 2,922 2,636 2,995 2,427 65 202 187 136 183 157 134 128 98 79 85 66 69 42 223 213 212 183 208 165 171 194 For notes see bottom of p. A59. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Bank-reported Data 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 1975 1976 1977 1975 1976 1977 Area and country Area and country Dec. Apr. Dec. Apr. Dec. Dec. Apr. Dec.r Apr. Dec. Other Western Europe Other Asia 1 Cyprus....................... 38 69 58 25 Afghanistan.................. 41 57 57 90 112 2 Iceland....................... ' 30 40 32 26 Bangladesh.................. 54 44 54 55 51 3 Ireland, Republic of. 43 237 131 27 Burma........................... 31 34 13 9 28 Cambodia.................... 4 3 4 12 Other Eastern Europe 29 Jordan............................ 39 23 37 23 31 4 Bulgaria..................................... 19 14 34 34 30 Laos.............................. 2 2 1 3 1 5 Czechoslovakia.......................... 32 11 21 46 31 Lebanon....................... 117 132 140 133 143 6 German Democratic Republic. 17 3 11 15 32 Malaysia....................... 77 130 396 511 157 7 Hungary.................................... 13 11 19 17 33 Nepal............................. 28 34 33 35 49 8 Poland....................................... 66 74 77 65 34 Pakistan....................... 74 92 189 135 253 9 Rumania................................... 44 29 19 51 35 Singapore....................... 256 344 280 300 295 36 Sri Lanka (Ceylon)___ 13 10 23 27 26 Other Latin American republics 37 Vietnam........................ 62 66 66 50 59 10 Bolivia..................................... 110 117 133 135 157 11 Costa Rica............................... 124 134 146 170 175 Other Africa 12 Dominican Republic............... 169 170 275 280 326 38 Ethiopia (incl. Eritrea) 60 72 41 48 42 13 Ecuador................................... 120 150 319 311 329 39 Ghana........................... 23 45 27 37 35 14 El Salvador............................. 171 212 178 214 227 40 Ivory Coast.................. 18 17 10 26 65 15 Guatemala............................... 260 368 409 392 513 41 Kenya............................. 19 39 46 185 46 16 Haiti........................................ 38 48 47 68 57 42 Liberia.......................... 53 63 77 95 82 17 Honduras................................. 99 137 137 210 152 43 Southern Rhodesia... 1 1 1 1 1 18 Jamaica................................... 41 59 35 43 32 44 Sudan............................ 12 17 22 30 30 19 Nicaragua............................... 133 158 120 133 165 45 Tanzania....................... 30 20 48 57 46 20 Paraguay................................. 43 50 49 60 59 46 Tunisia.......................... 29 34 20 15 29 21 Surinam 2................................ 13 30 17 14 47 Uganda.......................... 22 50 43 117 30 22 Trinidad and Tobago............. 131 44 167 85 202 48 Zambia.......................... 78 14 35 55 22 Other Latin America: All Other 23 Bermuda................ 170 197 177 199 237 49 New Zealand................ 42 48 45 75 80 24 British West Indies. 1,311 2,284 1,874 '2,4344,142 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 1977 1978 Holder, and area or country 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan.* Feb.* 1 Total....................................................................... 1,285 1,812 2,449 2,354 2,526 2,579 2,747 2,781 2,720 2,639 2 Nonmonetary international and regional 822 415 269 313 330 352 352 386 375 378 3 Foreign countries.................................................... 464 1,397 2,180 2,040 2,196 2,227 2,396 2,395 2,345 2,261 4 Official institutions, including central banks. .. 124 931 1,337 1,006 1,074 1,089 1,313 1,296 1,239 1,186 5 Banks, excluding central banks........................ 261 366 621 680 713 715 707 716 719 685 6 79 100 222 355 409 422 376 384 387 391 Area or country: 7 Europe................................................................ 226 330 570 664 708 719 704 696 701 659 8 146 214 346 308 307 308 309 307 313 310 9 59 66 124 169 200 205 200 180 176 177 10 Canada................................................................ 19 23 29 27 27 27 26 35 39 39 11 Latin America.................................................... 115 140 248 322 341 339 330 343 342 351 12 Middle East oil-exporting countries1............... 94 894 1,286 987 1,056 1,064 1,285 1,285 1,216 1,166 13 7 8 46 34 38 53 42 29 42 42 14 * * * * * 1 1 * * * 15 Other Africa....................................................... 1 1 * 6 23 22 6 5 5 5 16 All other countries............................................. * * 1 1 1 2 1 1 * * 1 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, Note.—Long-term obligations are those having an original maturity and United Arab Emirates (Trucial States). of more than 1 year. 2 Comprises Algeria, Gabon, Libya, and Nigeria. NOTES TO TABLE 3.16: 1 Includes Bank for International Settlements. 4 Comprises Algeria, Gabon, Libya, and Nigeria. 2 Surinam included with Netherlands Antilles until January 1976. 5 Asian, African, and European regional organizations, except BIS, 3 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, which is included in “Other Western Europe.” and United Arab Emirates (Trucial States). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A60 International Statistics □ April 1978 3.19 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Banks in the United States By Country Millions of dollars, end of period 1977 1978 Area and country 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan.p Feb.P 1 39,056 50,231 69,237 68,584 r69,125 75,104 74,726 79,915 81,499 80,532 2 Foreign countries.................................................... 39,055 50,229 69,232 68,573 "69,114 75,094 74,714 79,906 81,488 80,530 3 Europe..................................................................... 6,255 8,987 12,220 12,274 13,352 13,767 13,019 15,458 14,609 14,795 4 Austria................................................................ 21 15 44 53 117 75 52 52 95 98 5 384 352 662 476 558 782 751 793 897 787 6 Denmark............................................................ 46 49 85 100 140 126 107 130 140 127 7 Finland................................................................ 122 128 139 103 95 111 106 101 104 108 8 France................................................................. 673 1,471 1,445 1,471 1,356 1,341 1,320 1,616 1,367 1,599 9 Germany............................................................. 589 416 517 648 615 768 645 655 687 663 10 Greece................................................................. 64 49 79 68 103 98 107 94 86 112 11 345 370 929 1,011 1,065 1,104 1,157 1,284 1,130 1,121 12 Netherlands........................................................ 348 300 304 371 447 304 352 352 387 395 13 119 71 98 135 109 120 122 131 141 162 14 Portugal.............................................................. 20 16 65 138 148 138 120 138 103 117 15 Spain................................................................... 196 249 373 344 346 471 401 414 425 424 16 Sweden................................................................ 180 167 180 151 139 172 143 169 179 158 17 Switzerland......................................................... 335 237 485 533 700 681 614 633 722 850 18 Turkey................................................................ 15 86 176 329 337 329 344 312 286 262 19 United Kingdom................................................ 2,580 4,718 6,277 6,011 6,766 6,623 6,369 8,167 7,416 7,455 20 Yugoslavia.......................................................... 22 38 41 35 34 28 29 56 42 36 21 Other Western Europe....................................... 22 27 52 47 43 259 50 89 127 61 22 U.S.S.R............................................................... 46 103 99 81 89 82 81 100 110 90 23 Other Eastern Europe........................................ 131 127 171 169 146 155 150 173 164 170 24 Canada.................................................................... 2,776 2,817 3,049 3,978 3,400 3,626 3,803 3,716 4,052 4,247 25 Latin America........................................................ 12,377 20,532 34,270 32,831 r33,142 38,051 37,890 40,377 42,964 41,396 26 Argentina............................................................ 720 1,203 964 856 939 1,076 1,085 1,180 1,214 1,215 27 Bahamas............................................................. 3,405 7,570 15,336 13,647 '13,593 18,930 18,115 19,678 22,135 21,215 28 Brazil................................................................... 1,418 2,221 3,322 3,077 3,011 3,121 2,962 3,084 2,938 2,969 29 Chile................................................................... 290 360 387 382 431 435 443 507 507 502 30 Colombia............................................................ 713 689 586 542 528 570 554 573 548 541 31 Cuba................................................................... 14 13 13 13 13 10 15 10 14 4 32 Mexico................................................................ 1,972 2,802 3,432 3,460 3,488 3,261 3,201 2,997 2,993 2,791 33 Panama............................................................... 505 1,052 1,257 1,463 1,063 1,431 1,652 1,262 1,801 1,673 34 Peru..................................................................... 518 583 704 783 785 737 735 769 774 760 35 Uruguay.............................................................. 63 51 38 39 42 47 60 71 59 56 36 Venezuela............................................................ 704 1,086 1,564 1,435 1,656 1,654 1,714 1,840 1,736 1,891 37 Other Latin American republics....................... 852 967 1,125 1,233 1,224 1,290 1,316 1,466 1,491 1,456 38 Netherlands Antilles1........................................ 62 49 40 57 75 61 139 86 77 64 39 Other Latin America......................................... 1,142 1,885 5,503 5,844 6,293 5,426 5,898 6,854 6,678 6,259 40 16,226 16,057 17,672 16,828 16,566 16,856 17,315 17,766 17,291 17,522 41 China, People’s Republic of (Mainland)........ 4 22 3 9 27 20 22 12 14 15 42 China, Republic of (Taiwan)............................ 500 736 991 1,236 1,303 1,321 1,275 1,371 1,268 1,306 43 Hong Kong....................................................... 223 258 271 272 360 357 466 465 435 420 44 India................................................................... 14 21 41 65 59 48 54 35 47 54 45 Indonesia............................................................ 157 102 76 56 67 97 60 77 54 64 46 Israel................................................................... 255 491 551 323 304 348 347 441 368 362 47 Japan................................................................... 12,518 10,776 10,997 9,614 9,303 9,341 9,578 9,778 9,475 9,709 48 Korea.................................................................. 955 1,561 1,714 2,069 2,001 1,998 1,876 2,070 2,208 2,066 49 Philippines.......................................................... 372 384 559 478 477 489 508 470 476 528 50 Thailand.............................................................. 458 499 422 580 617 612 594 616 618 630 51 Middle East oil-exporting countries2............... 330 524 1,312 1,369 1,340 1,531 1,783 1,583 1,525 1,570 52 Other................................................................... 441 684 735 758 708 695 752 849 803 795 53 Africa...................................................................... 855 1,228 1,481 1,720 1,656 1,828 1,749 1,728 1,757 1,770 54 Egypt................................................................... 111 101 127 149 134 155 130 114 122 111 55 Morocco............................................................. 18 9 13 43 48 44 31 30 48 34 56 South Africa....................................................... 329 545 763 799 802 881 823 840 868 880 57 Zaire................................................................... 98 34 29 6 15 7 7 7 8 8 58 Oil-exporting countries3.................................... 115 231 253 357 306 378 358 321 312 360 59 Other................................................................... 185 308 296 365 350 362 399 416 400 377 60 Other countries....................................................... 565 609 540 943 998 966 939 861 814 800 61 Australia............................................................. 466 535 441 795 863 839 815 743 687 658 62 All other............................................................. 99 73 99 148 135 127 124 117 127 142 63 Nonmonetary international and regional organizations...................................................... * 1 5 11 9 12 9 10 2 10 1 Includes Surinam until January 1976. 3 Comprises Algeria, Gabon, Libya, and Nigeria. 2 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, 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 1977 1978 Type 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan.* Feb.* 1 39,056 50,231 69,237 68,584 '69,125 75,104 74,726 79,915 81,499 80,532 2 Payable in dollars.................................................. 37,859 48,888 67,592 66,666 '67,375 73,104 72,849 77,813 79,368 78,430 3 11,287 13,200 18,016 16,504 18,135 18,040 17,486 19,962 18,508 18,621 4 Official institutions, including central banks. 381 613 1,448 1,018 1,007 1,085 1,048 1,019 1,101 1,091 5 Banks, excluding central banks..................... 7,332 7,635 10,974 10,412 11,736 11,305 11,103 12,979 11,541 11,786 6 All other, including nonmonetary interna tional and regional organizations............. 3,574 4,951 5,594 5,074 5,392 5,649 5,335 5,964 5,866 5,744 7 Collections outstanding..................................... 5,637 5,467 5,756 6,200 6,025 6,005 6,045 6,184 6,342 6,361 8 Acceptances made for accounts of foreigners... 11,237 11,147 12,358 13,556 13,645 13,735 13,462 14,212 13,592 13,688 9 Other claims1..................................................... 9,698 19,075 31,462 30,406 '29,569 35,324 35,856 37,456 40,927 39,760 10 Payable in foreign currencies................................. 1,196 1,342 1,645 1,918 1,750 2,000 1,876 2,101 2,131 2,102 11 669 656 1,063 1,028 840 922 879 941 940 903 12 Foreign government securities, commercial 289 314 89 233 265 356 405 454 370 337 13 Other claims....................................................... 238 372 493 658 645 722 593 707 822 863 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 1977 1978 Type, and area or country 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan.* Feb.* 1 7,179 9,536 11,898 12,453 12,631 12,716 12,338 12,644 12,748 12,868 By type: 2 Payable in dollars............................................... 7,099 9,419 11,750 12,235 12,416 12,486 12,106 12,389 12,508 12,621 3 Loans, total..................................................... 6,490 8,316 10,093 10,504 10,609 10,760 10,421 10,671 10,817 10,892 4 Official institutions, including central banks 1,324 1,351 1,407 1,717 1,761 1,777 1,794 1,918 1,911 1,949 5 Banks, excluding central banks................. 929 1,567 2,232 2,279 2,321 2,419 2,289 2,385 2,405 2,414 6 All other, including nonmonetary interna tional and regional organizations......... 4,237 5,399 6,454 6,508 6,527 6,564 6,338 6,368 6,501 6,529 7 Other long-term claims..................................... 609 1,103 1,656 1,731 1,807 1,726 1,685 1,718 1,691 1,729 8 Payable in foreign currencies............................. 80 116 148 218 216 229 232 254 240 247 By area or country: 9 Europe................................................................ 1,908 2,704 3,328 3,745 3,707 3,664 3,402 3,484 3,436 3,455 10 Canada................................................................ 501 555 637 455 456 461 424 434 425 414 11 Latin America.................................................... 2,614 3,468 4,856 5,165 5,381 5,542 5,572 5,776 5,910 6,078 12 Asia..................................................................... 1,619 1,795 1,904 1,846 1,872 1,768 1,742 1,776 1,799 1,760 13 Japan............................................................... 258 296 382 371 359 339 320 317 337 297 14 Middle East oil-exporting countries i........... 384 220 146 170 161 173 154 181 193 212 15 Other Asia...................................................... 977 1,279 1,376 1,305 1,353 1,257 1,268 1,277 1,269 1,251 16 Africa.................................................................. 366 747 890 898 873 857 850 855 863 848 17 Oil-exporting countries2................................ 62 151 111 219 221 201 176 190 189 172 18 Other............................................................... 305 596 619 679 651 657 674 664 673 677 19 All other countries3........................................... 171 267 282 344 343 423 348 319 316 313 1 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, 2 Comprises Algeria, Gabon, Libya, and Nigeria. and United Arab Emirates (Trucial States). 3 Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A 62 International Statistics □ April 1978 3.22 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data Millions of dollars, end of period 1977 1978 Asset account 1974 1975 1976 Dec. July Aug. Sept. Oct. Nov. Dec. Jan.p All foreign countries 1 Total, all currencies............................ 151,905 176,493 219,420 235,637 234,592 244,955 '246,982 '249,382 259,475 258,812 2 6,900 6,743 7,889 10,683 8,192 11,914 8,232 9,074 11,748 10,012 3 Parent bank................................. 4,464 3,665 4,323 7,134 4,630 8,231 4,535 5,238 7,795 5,932 4 Other............................................ 2,435 3,078 3,566 3,549 3,562 3,683 3,697 3,836 3,953 4,080 5 138,712 163,391 204,486 217,456 218,869 225,123 230,295 r231,795 239,091 239,604 6 Other branches of parent bank.. 27,559 34,508 45,955 48,387 48,317 52,071 51,901 54,280 56,175 55,352 7 Other banks................................. 60,283 69,206 83,765 84,364 85,533 87,742 91,867 '89,211 92,190 92,207 8 Official institutions..................... 4,077 5,792 10,613 13,579 13,829 14,193 14,456 14,854 14,634 15,204 9 Nonbank foreigners.................... 46,793 53,886 64,153 71,126 71,190 71,116 72,071 73,450 76,092 76,840 10 Other assets..................................... 6,294 6,359 7,045 7,497 7,530 7,919 '8,455 '8,513 8,636 9,196 11 105,969 132,901 167,695 179,634 179,034 188,160 187,494 188,392 194,373 193,206 12 Claims on United States................. 6,603 6,408 7,595 10,266 7,748 11,434 7,690 8,503 11,156 9,390 13 Parent bank................................. 4,428 3,628 4,264 7,095 4,560 8,177 4,448 5,145 7,664 5,781 14 Other............................................ 2,175 2,780 3,332 3,170 3,188 3,257 3,242 3,358 3,492 3,609 15 Claims on foreigners....................... 96,209 123,496 156,896 166,057 167,716 173,191 175,842 175,772 179,212 179,339 16 Other branches of parent bank.. 19,688 28,478 37,909 39,647 39,995 42,983 42,693 44,337 44,680 43,923 17 Other banks................................. 45,067 55,319 66,331 65,875 66,826 68,789 71,591 68,924 71,095 70,519 18 Official institutions..................... 3,289 4,864 9,022 12,118 12,232 12,705 12,779 12,887 12,621 13,045 19 Nonbank foreigners.................... 28,164 34,835 43,634 48,417 48,663 48,714 48,778 49,623 50,816 51,853 20 Other assets..................................... 3,157 2,997 3,204 3,312 3,570 3,535 3,963 4,117 4,004 4,477 United Kingdom 21 69,804 74,883 81,466 83,484 83,270 88,033 90,154 88,748 91,039 90,789 22 Claims on United States................. 3,248 2,392 3,354 3,129 2,307 3,422 2,729 2,955 4,326 3,701 23 Parent bank................................. 2, All 1,449 2,376 2,249 1,397 2,556 1,789 2,123 3,502 2,928 24 Other............................................ 116 943 978 881 910 866 940 833 823 773 25 Claims on foreigners...................... 64,111 70,331 75,859 78,083 78,607 82,154 84,766 83,331 84,137 84,346 26 Other branches of parent bank.. 12,724 17,557 19,753 20,909 20,015 22,363 22,178 21,476 22,138 21,427 27 Other banks................................. 32,701 35,904 38,089 37,772 38,784 39,576 41,923 40,530 39,899 40,605 28 Official institutions..................... 788 881 1,274 1,863 1,983 1,955 2,052 2,145 2,206 2,303 29 Nonbank foreigners................... 17,898 15,990 16,743 17,538 17,826 18,259 18,613 19,180 19,895 20,010 30 Other assets..................................... 2,445 2,159 2,253 2,272 2,355 2,458 2,659 2,462 2,576 2,742 49,211 57,361 61,587 62,815 62,686 66,895 67,243 65,369 66,741 65,744 32 Claims on United States................. 3,146 2,273 3,275 3,011 2,130 3,259 2,545 2,744 4,085 3,443 33 Parent bank................................. 2,468 1,445 2,37 4 2,237 1,348 2,527 1,748 2,062 3,416 2,815 34 Other............................................ 678 828 902 774 781 732 797 682 669 628 35 Claims on foreigners....................... 44,694 54,121 57,488 58,875 59,419 62,584 63,596 61,587 61,529 61,094 36 Other branches of parent bank.. 10,265 15,645 17,249 18,135 17,550 19,865 19,497 18,539 19,068 18,102 37 Other banks................................. 23,716 28,224 28,983 28,497 29,199 29,808 31,134 29,560 28,530 28,661 38 610 648 846 1,473 1,574 1,555 1,595 1,639 1,669 1,770 39 Nonbank foreigners.................... 10,102 9,604 10,410 10,769 11,095 11,355 11,370 11,849 12,263 12,560 40 Other assets..................................... 1,372 967 824 930 1,138 1,052 1,103 1,038 1,126 1,208 Bahamas and Caymans 41 Total, all currencies............................ 31,733 45,203 66,774 74,727 73,284 78,430 75,962 76,769 79,053 80,040 42 2,464 3,229 3,508 6,447 4,875 7,455 4,687 5,259 5,765 4,994 43 Parent bank................................. 1,081 1,477 1,141 4,062 2,465 4,861 2,104 2,552 3,038 2,097 44 Other............................................ 1,383 1,752 2,367 2,385 2,410 2,595 2,583 2,707 2,728 2,897 45 Claims on foreigners........................ 28,453 41,040 62,048 66,970 67,124 69,680 69,685 69,839 71,672 73,431 46 Other branches of parent bank.. 3,478 5,411 8,144 7,586 8,259 9,828 9,266 10,611 11,120 11,272 47 Other banks................................. 11,354 16,298 25,354 25,968 25,482 26,368 27,131 25,912 28,248 28,795 48 Official institutions..................... 2,022 3,576 7,105 8,635 8,599 9,203 9,207 9,198 9,109 9,303 49 Nonbank foreigners.................... 11,599 15,756 21,445 24,780 24,783 24,281 24,082 24,119 23,195 24,061 50 Other assets..................................... 815 933 1,217 1,309 1,285 1,294 1,589 1,670 1,616 1,615 51 Total payable in U.S. dollars............. 28,726 41,887 62,705 69,535 68,192 72,932 70,415 71,728 73,988 74,790 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Overseas Branches A63 3.22 Continued 1977 1978 Liability account 1974 1975 1976 Dec. July Aug. Sept. Oct. Nov. Dec. Jan.* All foreign countries 52 Total, all currencies.......................... 151,905 176,493 219,420 235,637 234,592 244,955 '246,982 '249,382 259,475 258,812 53 To United States........................... 11,982 20,221 32,719 37,713 36,360 40,328 '39,952 '42,571 44,548 46,108 54 Parent bank............................... 5,809 12,165 19,773 19,670 19,438 20,073 '22,706 '25,037 24,987 28,633 55 Other.......................................... 6,173 8,057 12,946 18,043 16,922 20,255 '17,246 '17,535 19,560 17,476 56 To foreigners................................. 132,990 149,815 179,954 189,349 189,743 197,109 '198,732 '198,835 206,119 204,296 57 Other branches of parent bank. 26,941 34,111 44,370 47,015 47,221 49,932 '49,876 '51,489 53,140 51,833 58 Other banks............................... 65,675 72,259 83,880 86,786 86,457 '91,124 89,540 89,649 93,884 90,393 59 Official institutions................... 20,185 22,773 25,829 27,218 27,776 28,014 29,888 28,667 28,080 28,674 60 Nonbank foreigners.................. 20,189 20,672 25,877 28,329 28,289 28,040 29,429 29,030 31,015 33,396 61 Other liabilities............................. 6,933 6,456 6,747 8,575 8,488 7,518 '8,298 '7,975 8,808 8,408 62 Total payable in U.S. dollars........... 107,890 135,907 173,071 184,689 183,263 192,922 192,706 193,233 199,140 198,108 63 To United States........................... 11,437 19,503 31,932 36,751 35,482 39,403 '38,915 '■41,476 43,301 44,890 64 Parent bank............................... 5,641 11,939 19,559 19,396 19,168 19,759 '22,398 '24,745 24,667 28,330 65 5,795 7,564 12,373 17,355 16,314 19,644 '16,517 '16,731 18,633 16,560 66 To foreigners................................. 92,503 112,879 137,612 142,959 142,684 149,440 '149,400 '147,554 151,016 148,765 67 Other branches of parent bank. 19,330 28,217 37,098 38,939 39,483 '41,773 '41,528 '42,671 43,183 41,763 68 Other banks............................... 43,656 51,583 60,619 61,691 61,117 '65,547 62,892 62,094 64,708 61,223 69 Official institutions................... 17,444 19,982 22,878 24,240 24,481 24,695 26,366 25,113 23,942 24,546 70 Nonbank foreigners.................. 12,072 13,097 17,017 18,088 17,604 17,425 18,615 17,677 19,184 21,233 71 3,951 3,526 3,527 4,979 5,097 4,079 4,391 '4,204 4,823 4,453 United Kingdom 72 Total, all currencies.......................... 69,804 74,883 81,466 83,484 83,270 88,033 90,154 88,748 91,039 90,789 73 To United States........................... 3,978 5,646 5,997 8,537 7,933 7,922 7,310 7,237 7,806 6,008 74 Parent bank.................................... 510 2,122 1,198 2,217 1,611 1,425 1,364 1,375 1,557 1,253 75 Other................................................ 3,468 3,523 4,798 6,320 6,322 6,496 5,946 5,862 6,249 4,755 76 To foreigners................................. 63,409 67,240 73,228 72,585 72,848 77,580 79,837 79,087 80,387 82,160 77 Other branches of parent bank. 4,162 6,494 7,092 7,987 8,395 8,934 9,187 9,491 9,376 9,999 78 Other banks.................................... 32,040 32,964 36,259 34,623 34,163 37,024 36,676 36,974 37,626 36,603 79 Official institutions..................... 15,258 16,553 17,273 17,148 17,366 18,553 20,366 19,555 18,298 19,309 80 Nonbank foreigners................... 11,349 11,229 12,605 12,827 12,923 13,070 13,608 13,066 15,087 16,249 81 Other liabilities................................ 2,418 1,997 2,241 2,362 2,488 2,532 3,007 2,424 2,846 2,621 82 Total payable in U.S. dollars......... 49,666 57,820 63,174 63,848 63,334 67,689 68,594 66,289 67,679 66,619 83 To United States ....................... 3,744 5,415 5,849 8,348 7,676 7,622 7,004 7,012 7,550 5,737 84 Parent bank.................................. 484 2,083 1,182 2,184 1,563 1,363 1,288 1,339 1,522 1,222 85 Other............................................... 3,261 3,332 4,666 6,164 6,113 6,259 5,716 5,673 6,028 4,515 86 To foreigners............................... 44,594 51,447 56,372 54,550 54,539 58,962 60,304 58,285 58,720 59,671 87 Other branches of parent bank 3,256 5,442 5,874 6,583 7,131 7,535 1,124 7,871 7,505 8,164 88 Other banks................................ 20,526 23,330 25,527 23,681 23,254 25,984 25,306 24,605 25,434 23,703 89 Official institutions.................... 13,225 14,498 15,423 15,295 15,252 16,430 18,053 17,171 15,462 16,459 90 Nonbank foreigners.................. 7,587 8,176 9,547 8,990 8,902 9,013 9,221 8,638 10,319 11,345 91 Other liabilities................................ 1,328 959 953 951 1,119 1,105 1,286 991 1,409 1,210 Bahamas and Caymans 92 Total, all currencies........................ 31,733 45,203 66,774 74,727 73,284 78,430 75,962 76,769 79,053 80,040 93 To United States......................... 4,815 11,147 22,721 25,080 24,487 28,741 28,442 30,641 32,140 35,772 94 Parent bank............................. 2,636 7,628 16,161 14,835 15,288 16,524 18,538 20,572 20,921 24,713 95 Other........................................ 2,180 3,520 6,560 10,245 9,198 12,218 9,905 10,069 11,219 11,060 96 To foreigners............................... 26,140 32,949 42,899 47,163 46,468 48,328 46,034 44,571 45,294 42,912 97 Other branches of parent bank 7,702 10,569 13,801 13,736 13,206 '13,756 13,844 13,308 12,818 11,642 98 Other banks............................. 14,050 16,825 21,760 24,168 23,881 '26,933 23,678 23,374 24,717 22,256 99 Official institutions................. 2,377 3,308 3,573 4,322 4,592 3,184 3,357 3,053 3,000 3,183 100 Nonbank foreigners................ 2,011 2,248 3,765 4,937 4,789 4,455 5,155 4,836 4,759 5,831 101 Other liabilities........................... 778 1,106 1,154 2,484 2,330 1,361 1,485 1,557 1,619 1,356 102 Total payable in U.S. dollars......... 28,840 42,197 63,417 70,367 68,627 73,733 71,187 72,286 74,464 75,438 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A64 International Statistics □ April 1978 3.23 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Holdings and Transactions Millions of dollars 1978 1977 1978 Country or area 1976 1977 F Ja eb n . . ^ - Aug. Sept. Oct. Nov. Dec. Jan.** Feb.P Holdings (end of period) 4 1 Estimated total... 15,799 38,620 27,583 31,066 34,324 37,661 38,620 40,101 40,379 2 Foreign countries. 12,765 33,874 24,643 27,207 30,323 33,285 33,874 35,648 35,479 3 Europe............................... 2,330 13,916 8,480 10,163 12,603 14,003 13,916 15,044 14,895 4 Belgium-Luxembourg.. 14 19 19 19 20 20 19 19 19 5 Germany....................... 764 3,168 1,847 1,957 2,165 2,742 3,168 3,373 3,494 6 Netherlands................. 288 911 633 719 821 911 911 930 954 7 Sweden......................... 191 100 155 125 125 100 100 125 125 8 Switzerland................... 261 All 478 488 474 476 All 391 401 9 United Kingdom.......... 485 8,888 5,017 6,506 8,640 9,419 8,888 9,839 9,513 10 Other Western Europe. 323 349 326 343 353 331 349 362 384 11 Eastern Europe............ 4 4 4 4 4 4 4 4 4 12 Canada. 256 288 288 292 294 293 288 285 250 13 Latin America............................... 313 551 513 516 519 533 551 543 587 14 Venezuela................................... 149 199 193 183 183 199 199 201 241 15 Other Latin America republics. 36 17 18 18 21 11 17 10 14 16 Netherlands Antilles 1.............. 118 170 145 158 158 167 170 162 162 17 Asia........ 9,323 18,745 15,070 15,941 16,611 18,104 18,745 19,413 19,378 18 Japan. 2,687 6,860 5,025 5,635 5,958 6,547 6,860 7,463 7,617 19 Africa........ 543 362 279 279 279 348 362 362 362 20 All other. * 11 12 16 18 5 11 2 7 21 Nonmonetary international and regional organizations..................................... 3,034 4,746 2,940 3,859 4,001 4,376 4,746 4,453 4,900 22 International.................... 2,906 4,646 2,830 3,759 3,900 4,276 4,646 4,358 4,781 23 Latin American regional. 128 100 110 100 100 100 100 95 120 Transactions (netpurchases, or sales ([—), durinig period) 24 Total..................... 8,096 22,823 1,760 4,151 3,483 3,257 3,337 959 1,481 278 25 Foreign countries. 5,393 21,110 1,605 3,796 2,564 3,116 2,962 589 1,774 -169 26 Official institutions. 5,116 20,328 1,437 3,696 2,493 3,052 2,885 598 1,714 -277 27 Other foreign.......... 276 782 167 101 71 65 76 -9 59 108 28 Nonmonetary international and regional organizations..................................... 2,704 1,713 155 354 919 141 376 370 -292 447 Memo: Oil-exporting countries 29 Middle East 2.......................... 3,887 4,451 -127 533 161 284 869 324 56 -184 30 Africa 3.................................... 221 -181 69 13 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). on a benchmark survey of holdings as of Jan. 31, 1971, and monthly 3 Comprises Algeria, Gabon, Libya, and Nigeria. transactions reports. Excludes nonmarketable U.S. Treasury bonds and notes held by official institutions of foreign countries. 3.24 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS Millions of dollars, end of period 1977 1978 Assets 1974 1975 1976 Sept. Oct. Nov. Dec. Jan. Feb. Mar. 1 Deposits................................................................. 418 353 352 382 425 416 424 422 445 352 Assets held in custody: 2 U.S. Treasury securities1................................... 55,600 60,019 66,532 79,285 83,832 89,497 91,962 95,945 98,465 105,362 3 Earmarked gold2............................................... 16,838 16,745 16,414 16,073 15,988 15,872 15,988 15,726 15,735 15,727 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 1978 1977 1978 Transactions, and area or country 1976 1977 F Ja e n b. . * - Aug. Sept. Oct. Nov. Dec. Jan.* Feb.* U.S. corporate securities Stocks 1 18,227 14,154 1,850 1,023 1,012 973 1,282 1,235 1,025 825 2 15,485 11,479 1,671 900 847 752 899 945 909 762 3 2,743 2,676 179 123 165 222 383 290 116 63 4 Foreign countries................................................ 2,730 2,661 179 124 170 223 385 286 117 63 5 329 1,006 72 37 57 109 200 156 31 41 6 256 40 -14 -13 5 27 1 -3 -12 -2 7 Germany..................................................... 68 291 78 -1 14 37 64 58 45 33 8 Netherlands................................................ -199 22 -17 -2 -18 5 10 9 -4 -13 9 -100 152 -70 -7 6 2 34 -3 -54 -16 10 333 613 117 67 80 52 106 109 60 57 11 Canada............................................................ 324 65 -45 -5 -3 20 21 14 -19 -26 12 Latin America................................................ 152 127 -14 1 -3 -4 27 15 -9 -4 13 Middle East1.................................................. 1,803 1,389 155 94 108 93 128 100 107 48 14 Other Asia...................................................... 119 59 7 -3 8 2 8 1 6 1 15 7 5 2 1 2 2 * * * 2 16 Other countries.............................................. -4 8 2 -2 1 2 2 * 1 1 17 Nonmonetary international and regional 13 15 * -1 -5 -1 -2 4 -1 1 Bonds2 18 5,529 7,766 983 715 503 942 743 354 459 524 19 Foreign sales...................................................... 4,322 3,432 725 252 383 292 226 267 377 348 20 1,207 4,334 259 463 120 650 517 87 83 176 21 Foreign countries................................................ 1,248 4,238 231 438 123 650 507 41 101 131 22 Europe............................................................ 91 2,005 165 130 33 376 320 19 133 32 23 39 -39 -3 1 1 * -5 -11 -4 1 24 Germany..................................................... -49 59 8 1 3 5 4 9 1 7 25 Netherlands............................................... -29 72 8 * 21 2 20 * 7 1 26 158 158 -4 21 12 -7 -7 -6 -7 3 27 United Kingdom........................................ 23 1,702 147 96 6 324 324 28 125 22 28 Canada............................................................ 96 141 14 13 15 4 1 -1 7 7 29 Latin America................................................ 94 64 17 18 13 11 -1 3 11 6 30 Middle East1.................................................. 1,179 1,695 16 192 79 124 159 4 -59 75 31 -165 338 20 84 -14 135 27 16 9 11 32 Africa.............................................................. -25 -6 -1 * -3 * * * * -1 33 Other countries.............................................. -21 * * * * * * * * * 34 Nonmonetary international and regional -41 96 27 25 -2 * 10 46 -18 45 Foreign securities 35 -323 -404 216 -63 30 106 34 59 103 113 36 Foreign purchases.............................................. 1,937 2,265 535 169 168 247 214 291 255 280 37 2,259 2,669 319 232 138 141 180 232 152 167 38 Bonds, net purchases, or sales (—)....................... -8,730 -5,005 -744 -1,004 -650 -281 -320 -330 -569 -175 39 Foreign purchases.............................................. 4,932 8,420 1,213 847 695 786 593 885 691 522 40 Foreign sales...................................................... 13,662 13,424 1,956 1,851 1,345 1,066 913 1,215 1,260 696 41 Net purchases, or sales (—) of stocks and bonds.. -9,053 -5,409 -528 -1,067 -620 -175 -285 -271 -466 -62 42 Foreign countries.................................................... -7,155 -3,852 -455 -228 -613 -24 -308 -293 -473 19 43 Europe................................................................ -843 -1,099 193 -20 -24 -33 -260 108 98 95 44 Canada............................................................... -5,245 -2,402 -448 -255 -573 45 9 -175 -446 -3 45 Latin America.................................................... * -80 31 -7 35 -170 -2 -68 -6 37 46 Asia..................................................................... -699 -5 -227 55 29 136 -57 51 -114 -113 47 Africa.................................................................. 48 2 -3 -3 1 -2 * 1 -2 * 48 Other countries.................................................. -416 -267 * 1 -81 1 2 -210 -3 2 49 Nonmonetary international and regional organizations................................................... -1,898 -1,557 -73 -839 -6 -151 23 22 7 -80 1 Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, 2 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 investments abroad. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A66 International Statistics □ April 1978 3.26 SHORT-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars, end of period 1976 1977 1976 1977 Type, and area or country Sept. Dec. Mar. June Sept.P Sept. Dec. Mar. June Sept.** Liabilities to foreigners Claims on foreigners 1 6,427 6,597 6,582 6,421 7,119 13,160 14,154 14,951 16,144 14,866 By type: 2 Payable in dollars............................................... 5,690 5,885 5,815 5,770 6,327 12,095 13,155 13,935 15,031 13,819 3 Payable in foreign currencies............................. 737 712 767 652 792 1,065 999 1,016 1,113 1,047 4 Deposits with banks abroad in reporter’s 592 442 431 448 414 5 473 557 585 665 632 By area or country: 6 Foreign countries.................................................... 6,241 6,388 6,391 6,251 6,965 13,159 14,153 14,949 16,143 14,865 7 Europe................................................................. 2,387 2,228 2,126 2,208 2,314 5,158 5,282 5,232 5,820 5,009 8 Austria............................................................ 15 10 9 10 12 21 21 23 26 24 9 Belgium-Luxembourg.................................... 183 166 168 138 119 195 162 170 218 230 10 Denmark........................................................ 13 7 15 14 16 26 56 48 40 44 11 Finland............................................................ 17 2 2 10 10 135 77 40 90 59 12 France............................................................. 185 200 163 157 170 418 438 436 413 435 13 Germany......................................................... 256 174 175 163 226 492 378 367 377 393 14 28 48 80 73 78 56 51 90 86 53 15 Italy................................................................. 148 131 135 154 139 358 384 473 440 352 16 Netherlands.................................................... 141 141 168 205 176 142 166 172 182 161 17 Norway........................................................... 24 29 37 33 36 43 51 42 42 38 18 Portugal.......................................................... 5 13 23 20 12 28 40 35 30 34 19 36 40 52 68 74 336 369 325 322 309 20 35 34 36 36 41 62 90 93 92 91 21 Switzerland..................................................... 243 190 214 236 245 253 241 154 179 146 22 16 13 12 21 97 23 25 32 37 32 23 United Kingdom............................................ 888 880 689 730 736 2,367 2,446 2,475 3,027 2,413 24 Yugoslavia...................................................... 113 123 113 110 92 30 26 30 28 20 25 Other Western Europe................................... 8 7 6 6 9 17 20 18 15 15 26 U.S.S.R........................................................... 19 9 15 16 11 81 156 105 76 64 27 Other Eastern Europe................................... 14 13 13 10 14 79 85 103 102 96 28 Canada................................................................ 341 400 427 '448 454 2,187 2,458 2,426 2,563 2,477 29 Latin America.................................................... 1,028 1,037 1,118 1,017 1,025 2,828 3,575 4,397 4,925 4,489 30 Argentina........................................................ 48 44 42 50 50 39 44 46 51 53 31 Bahamas......................................................... 251 260 256 216 222 940 1,384 1,869 2,231 1,831 32 Brazil.............................................................. 58 72 49 37 76 417 682 535 457 414 33 Chile............................................................... 16 17 16 24 13 26 34 35 28 40 34 11 13 18 22 23 66 59 75 72 85 35 Cuba............................................................... * * * * * 1 1 1 1 * 36 74 99 118 117 102 352 332 317 301 304 37 10 34 12 11 12 83 74 105 121 221 38 Peru................................................................. 32 25 24 21 13 35 42 32 28 30 39 Uruguay.......................................................... 3 4 4 3 4 22 5 6 5 5 40 222 219 260 208 225 212 190 210 240 256 41 Other Latin American republics................... 104 141 148 141 122 182 276 237 237 257 42 Netherlands Antilles..................................... 68 10 11 17 9 9 9 14 8 8 43 129 100 160 151 154 444 441 914 1,146 984 44 Asia..................................................................... 1,978 2,040 2,057 1,890 2,492 2,401 2,276 2,316 2,315 2,390 45 China, People’s Republic of (Mainland)---- 1 1 3 2 1 5 3 7 7 12 46 China, Republic of (Taiwan)........................ 127 110 113 138 152 134 197 130 131 139 47 Hong Kong.................................................... 33 40 42 27 25 88 96 107 93 73 48 11 23 39 41 44 53 55 35 51 42 49 Indonesia........................................................ 131 98 94 80 60 179 179 206 184 185 50 Israel............................................................... 32 37 37 45 58 48 41 51 70 46 51 Japan.............................................................. 247 193 172 183 604 1,010 912 969 930 1,027 52 Korea.............................................................. 85 76 96 95 81 142 117 130 158 153 53 Philippines...................................................... 28 53 59 73 78 93 86 86 90 111 54 Thailand.......................................................... 23 24 19 11 17 23 22 27 22 27 55 1,260 1,385 1,383 1,196 1,372 625 568 569 580 574 56 438 606 591 589 568 407 393 429 370 346 57 25 27 29 33 45 36 28 70 24 22 58 44 45 30 72 105 10 11 12 11 10 59 South Africa................................................... 66 54 33 27 29 78 87 80 69 75 60 Zaire............................................................... 24 36 39 39 48 28 21 19 17 19 61 Other Africa................................................... 279 444 460 418 341 255 247 248 248 221 62 Other countries................................................... 69 77 72 98 111 178 170 150 149 153 63 Australia......................................................... 51 59 53 78 93 112 105 114 110 113 64 All other.......................................................... 18 19 19 20 18 67 65 36 40 41 65 Nonmonetary international and regional organizations................................................... 186 208 192 170 154 1 1 2 1 1 Note.—Reported by exporters, importers, and industrial and com- Data exclude claims held through U.S. banks and intercompany accounts mercial concerns and other nonbanking institutions in the United States. between U.S. companies and their 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 1977 1978 Type and country 1973 1974 1975 1976 Aug. Sept. Oct. Nov. Dec. Jan.p 1 3,185 3,357 3,799 5,468 7,735 6,859 7,623 7,587 6,709 7,371 By type: 2 Payable in dollars................................. 2,641 2,660 3,042 4,788 6,999 6,163 6,900 6,671 5,778 6,310 3 Deposits.......................................................... 2,604 2,591 2,710 4,415 6,475 5,721 6,396 6,196 5,346 5,856 4 Short-term investments i........................ 37 69 332 373 524 442 504 475 432 454 5 Payable in foreign currencies............................. 544 697 757 680 737 695 722 917 931 1,062 6 Deposits.......................................................... 431 429 511 373 394 3t 8 374 482 521 550 7 Short-term investments *............................... 113 268 246 302 343 337 348 435 410 512 By country: 8 United Kingdom................................................ 1,128 1,350 1,306 1,837 2,194 1,781 1,858 2,097 1,977 1,671 9 Canada................................................................ 775 967 1,156 1,539 1,930 1,607 1,936 1,831 1,705 2,167 10 Bahamas.............................................................. 597 391 546 1,264 2,220 1,765 2,361 2,117 1,755 2,217 11 Japan................................................................... 336 398 343 113 134 143 150 218 136 194 12 All other.............................................................. 349 252 446 715 1,257 1,563 1,318 1,324 1,136 1,122 i Negotiable and other readily transferable foreign obligations payable Note.—Data represent the assets abroad of large nonbanking con on demand or having a contractural maturity of not more than 1 year cerns in the United States. They are a portion of the total claims on from the date on which the obligation was incurred by the foreigner. foreigners reported by nonbanking concerns in the United States and are included in the figures shown in Table 3.26. 3.28 LONG-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars, end of period 1976 1977 1976 1977 Area and country Sept. Dec. Mar. June Sept.** Sept. Dec. Mar. June Sept.? Liabilities to foreigners Claims on foreigners 1 Total....................................................................... 3,791 3,567 3,504 3,338 3,366 5,004 4,922 4,891 4,824 4,586 2 Europe.................................................................... 2,858 2,725 2,655 2,499 2,596 898 851 844 827 744 3 Germany............................................................ 406 396 391 370 417 73 72 84 76 76 4 Netherlands........................................................ 290 277 272 262 280 211 156 154 147 81 5 Switzerland......................................................... 327 260 178 177 224 54 57 53 43 42 6 United Kingdom................................................ 1,470 1,420 1,388 1,276 1,275 243 238 204 219 215 7 Canada................................................................... 111 89 82 81 78 1,507 1,530 1,475 1,486 1,438 8 Latin America........................................................ 257 270 272 280 272 1,637 1,521 1,489 1,457 1,371 9 Bahamas............................................................. 157 163 163 167 159 37 36 34 34 36 10 Brazil.................................................................. 5 5 5 7 7 172 133 125 125 134 11 Chile................................................................... 1 1 1 1 1 244 248 210 208 201 12 Mexico................................................................ 7 17 21 23 27 219 195 180 178 187 13 Asia......................................................................... 498 423 432 408 358 739 775 817 830 805 14 Japan.................................................................. 402 397 413 386 319 80 77 96 108 90 15 Africa..................................................................... 2 2 2 3 3 165 187 199 158 165 16 All other *.............................................................. 64 58 59 67 59 58 58 67 67 63 1 Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A68 International Statistics n April 1978 3.29 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Per cent per annum Rate on Mar. 31,1978 Rate on Mar. 31, 1978 Rate on Mar. 31,1978 Country Country Country Per Month Per Month Per Month cent effective cent effective cent effective Argentina........................ 18.0 Feb. 1972 9.5 Aug. 1977 7.0 Feb. 1978 Austria............................. 5.5 June 1977 Germany, Fed. Rep. of. 3.0 Dec. 1977 7.5 Feb. 1978 Belgium........................... 5.5 Mar. 1978 11.5 Aug. 1977 1.0 Feb. 1978 Brazil............................... 28.0 May 1976 3.5 Mar. 1978 United Kingdom.......... 6.5 Jan. 1978 Canada............................ 8.0 Mar. 1978 4.5 June 1942 5.0 Oct. 1970 Denmark.......................... 9.0 Mar. 1977 Netherlands................... 4.5 Nov. 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 1977 1978 Country, or type 1975 1976 1977 Oct. Nov. Dec. Jan. Feb. Mar. 1 Euro-doIIars.......................................................... 7.02 5.58 6.03 7.14 7.09 7.12 7.32 7.28 7.27 2 United Kingdom.................................................. 10.63 11.35 8.07 5.05 5.32 6.76 6.23 6.82 6.72 3 Canada.................................................................. 8.00 9.39 7.47 7.23 7.34 7.20 7.08 7.14 7.44 4 Germany............................................................... 4.87 4.19 4.30 4.06 4.09 3.94 3.52 3.45 3.49 5 Switzerland............................................................ 3.01 1.45 2.56 2.23 2.32 2.20 .92 .50 .46 6 Netherlands.......................................................... 5.17 7.02 4.73 4.55 5.94 6.65 5.01 5.28 5.35 7 France................................................................... 7.91 8.65 9.20 8.41 9.28 9.88 9.25 10.45 9.86 8 Italy....................................................................... 10.37 16.32 14.26 12.05 11.74 11.38 10.99 0) 0) 9 Belgium................................................................. 6.63 10.25 6.95 6.25 6.38 7.75 8.29 6.75 6.41 10 Japan..................................................................... 11.64 7.70 6.22 5.25 5.37 5.75 5.33 5.25 4.86 1 Unquoted. over; and Japan, loans and discounts that can be called after being held Note.—Rates are for 3-month interbank loans except for—Canada, over a minimum of two month-ends. finance company paper; Belgium, time deposits of 20 million francs and 3.31 FOREIGN EXCHANGE RATES Cents per unit of foreign currency 1977 1978 Country/currency 1975 1976 1977 Oct. Nov. Dec. Jan. Feb. Mar. 1 Australia/dollar.................. 130.77 122.15 110.82 111.90 112.70 113.36 113.82 113.56 113.83 2 Austria/shilling................... 5.7467 5.5744 6.0494 6.1567 6.2551 6.4734 6.5698 6.6893 6.8221 3 Belgium/franc..................... 2.7253 2.5921 2.7911 2.8229 2.8396 2.9608 3.0425 3.0930 3.1589 4 Canada/dollar..................... 98.30 101.41 94.112 91.010 90.145 91.132 90.810 89.850 88.823 5 Denmark/krone.................. 17.437 16.546 16.658 16.359 16.327 16.833 17.324 17.610 17.839 6 Finland/markka................. 27.285 25.938 24.913 24.139 23.986 24.299 24.816 24.527 24.013 7 France/franc....................... 23.354 20.942 20.344 20.574 20.614 20.844 21.196 20.628 21.256 8 Germany/deutsche mark... 40.729 39.737 43.079 43.904 44.633 46.499 47.220 48.142 49.181 9 India/rupee......................... 11.926 11.148 11.406 11.605 11.576 11.712 12.195 12.331 12.185 10 Ireland/pound..................... 222.16 180.48 174.49 177.11 181.78 185.46 193.53 193.96 190.55 11 Italy/lira.............................. .15328 .12044 .11328 .11353 .11388 .11416 .11469 .11619 .11692 12 Japan/yen........................... .33705 .33741 .37342 .39263 .40872 .41491 .41481 .41603 .43148 13 Malaysia/ringgit................. 41.753 39.340 40.620 41.088 41.910 42.201 42.230 42.374 42.428 14 Mexico/peso....................... 8.0000 6.9161 4.4239 4.4069 4.4096 4.4059 4.3963 4.3972 4.3928 15 Netherlands/guilder............ 39.632 37.846 40.752 41.048 41.366 42.955 44.084 44.880 45.994 16 New Zealand/dollar........... 121.16 99.115 96.893 98.152 99.392 100.59 101.95 102.07 102.20 17 Norway/krone.................... 19.180 18.327 18.789 18.232 18.328 19.056 19.401 19.025 18.775 18 Portugal/escudo................. 3.9286 3.3159 2.6234 2.4601 2.4575 2.4755 2.4840 2.4806 2.4483 19 South Africa/rand.............. 136.47 114.85 114.99 115.04 115.04 115.04 115.02 115.05 115.05 20 Spain/peseta....................... 1.7424 1.4958 1.3287 1.1902 1.2060 1.2237 1.2397 1.2394 1.2497 21 Sri Lanka/rupee................. 14.385 11.908 11.964 11.618 8.7721 6.2000 6.2167 6.4028 6.5000 22 Sweden/krona..................... 24.141 22.957 22.383 20.846 20.848 21.044 21.413 21.554 21.693 23 Switzerland/franc............... 38.743 40.013 41.714 43.909 45.507 48.168 50.353 52.422 52.693 24 United Kingdom/pound... 222.16 180.48 174.49 177.11 181.78 185.46 193.53 193.96 190.55 Memo: 25 United States/dollar 1........ 82.20 89.68 89.10 88.38 87.29 85.52 84.05 83.74 82.94 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
A 69 Guide to Tabular Presentation and Statistical Releases GUIDE TO TABULAR PRESENTATION Symbols and Abbreviations p Preliminary SMSA’s Standard metropolitan statistical areas r Revised (Notation appears on column heading REIT’s Real estate investment trusts when more than half of figures in that * Amounts insignificant in terms of the partic column are changed.) ular unit (e.g., less than 500,000 when e Estimated the unit is millions) c Corrected (1) Zero, (2) no figure to be expected, or n.e.c. Not elsewhere classified (3) figure delayed or, (4) no change (when Rp’s Repurchase agreements figures are expected in percentages). IPC’s Individuals, partnerships, and corporations 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 ........................................... December 1977 A-76 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A70 Federal R eserve Board o f G overnors G. William Miller, Chairman Henry C. Wallich Stephen S. Gardner, Vice Chairman Phillip E. Coldwell OFFICE OF BOARD MEMBERS OFFICE OF STAFF DIRECTOR FOR MONETARY POLICY Thomas J. O’Connell, Counsel to the Chairman Joseph R. Coyne, Assistant to the Board Stephen H. Axilrod, Staff Director Kenneth A. Guenther, Assistant to the Board Arthur L. Broida, Deputy Staff Director Sidney L. Jones, Assistant to the Board Murray Altmann, Assistant to the Board Jay Paul Brenneman, Special Assistant to the Peter M. Keir, Assistant to the Board Board Stanley J. Sigel, Assistant to the Board Frank O’Brien, Jr., Special Assistant to the Board Normand R. V. Bernard, Special Assistant to the Joseph S. Sims, Special Assistant to the Board Board Donald J. Winn, Special Assistant to the Board DIVISION OF RESEARCH AND STATISTICS LEGAL DIVISION James L. Kichline, Director Neal L. Petersen, General Counsel Joseph S. Zeisel, Deputy Director Robert E. Mannion, Associate General Counsel Edward C. Ettin, Associate Director Allen L. Raiken, Associate General Counsel John H. Kalchbrenner, Associate Director Charles R. McNeill, Assistant to the General John J. Mingo, Senior Research Division Officer Counsel Eleanor J. Stockwell, Senior Research Division Officer James R. Wetzel, Senior Research Division Officer Robert A. Eisenbeis, Associate Research Division OFFICE OF THE SECRETARY Officer Jared J. Enzler, Associate Research Division Theodore E. Allison, Secretary Officer Griffith L. Garwood, Deputy Secretary J. Cortland G. Peret, Associate Research *Cathy E. Minehan, Assistant Secretary Division Officer Richard H. Puckett, Associate Research Division Officer DIVISION OF CONSUMER AFFAIRS tHELMUT F. Wendel, Associate Research Division Officer Janet O. Hart, Director James M. Brundy, Assistant Research Division Nathaniel E. Butler, Associate Director Officer Jerauld C. Kluckman, Associate Director Robert M. Fisher, Assistant Research Division Officer Stephen P. Taylor, Assistant Research Division DIVISION OF BANKING Officer SUPERVISION AND REGULATION Levon H. Garabedian, Assistant Director John E. Ryan, Director *Frederick C. Schadrack, Deputy Director DIVISION OF INTERNATIONAL FINANCE Frederick R. Dahl, Associate Director William W. Wiles, Associate Director Edwin M. Truman, Director Jack M. Egertson, Assistant Director John E. Reynolds, Counselor Don E. Kline, Assistant Director Robert F. Gemmill, Associate Director Thomas E. Mead, Assistant Director George B. Henry, Associate Director Robert S. Plotkin, Assistant Director Charles J. Siegman, Associate Director Thomas A. Sidman, Assistant Director Samuel Pizer, Senior International Division Samuel H. Talley, Assistant Director Officer William Taylor, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
All and Official Staff Philip C. Jackson, Jr. J. Charles Partee OFFICE OF OFFICE OF STAFF DIRECTOR FOR STAFF DIRECTOR FOR MANAGEMENT FEDERAL RESERVE BANK ACTIVITIES John M. Denkler, Staff Director William H. Wallace, Staff Director Robert J. Lawrence, Deputy Staff Director Donald E. Anderson, Assistant Director for DIVISION OF FEDERAL RESERVE Construction Management BANK EXAMINATIONS AND BUDGETS Joseph W. Daniels, Sr., Assistant Director and Director of Equal Employment Opportunity Albert R. Hamilton, Director Gordon B. Grim wood, Assistant Director and Clyde H. Farnsworth, Jr., Associate Director Program Director for Contingency Planning John F. Hoover, Assistant Director P. D. Ring, Assistant Director DIVISION OF DATA PROCESSING DIVISION OF Charles L. Hampton, Director FEDERAL RESERVE BANK OPERATIONS Bruce M. Beardsley, Associate Director Uyless D. Black, Assistant Director James R. Kudlinski, Director Glenn L. Cummins, Assistant Director Walter Althausen , Assistant Director Robert J. Zemel, Assistant Director Brian M. Carey, Assistant Director Harry A. Guinter, Assistant Director DIVISION OF PERSONNEL David L. Shannon, Director John R. Weis, Assistant Director Charles W. Wood, Assistant Director OFFICE OF THE CONTROLLER John Kakalec, Controller Edward T. Mulrenin, Assistant Controller DIVISION OF ADMINISTRATIVE SERVICES Walter W. Kreimann, Director John L. Grizzard, Assistant Director John D. Smith, Assistant Director *0n loan from the Federal Reserve Bank of New York, fOn leave of absence. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A ll FOMC and A dvisory Councils FEDERAL OPEN MARKET COMMITTEE G. William Miller, Chairman Paul A. Volcker, Vice Chairman Ernest T. Baughman Stephen S. Gardner Henry C. Wallich Arthur F. Burns Philip C. Jackson, Jr. Mark H. Willes Philip E. Coldwell J. Charles Partee Willis J. Winn David P. Eastburn Arthur L. Broida, Secretary Richard G. Davis, Associate Economist Murray Altmann, Deputy Secretary Edward C. Ettin, Associate Economist Normand R. V. Bernard, Assistant Secretary Ira Kaminow, Associate Economist Thomas J. O’Connell, General Counsel Peter M. Keir, Associate Economist Edward G. Guy, Deputy General Counsel James L. Kichline, Associate Economist Robert E. Mannion, Assistant General Counsel John Paulus, Associate Economist Stephen H. Axilrod, Economist John E. Reynolds, Associate Economist Joseph Burns, Associate Economist Edwin M. Truman, Associate Economist John M. Davis, Associate Economist Joseph S. Zeisel, Associate Economist Alan R. Holmes, Manager, System Open Market Account Peter D. Sternlight, Deputy Manager for Domestic Operations Scott E. Pardee, Deputy Manager for Foreign Operations FEDERAL ADVISORY COUNCIL Gilbert F. Bradley, twelfth federal reserve district, President J. W. McLean, tenth federal reserve district, Vice President Henry S. Woodbridge, first district Frank A. Plummer, sixth district Walter B. Wriston, second district Edward Byron Smith, seventh district Samuel H. Ballam, Jr., third district Clarence C. Barksdale, eighth district M. Brock Weir, fourth district Richard H. Vaughan, ninth district John H. Lumpkin, fifth district James D. Berry, eleventh district Herbert V. Prochnow, Secretary William J. Korsvik, Associate Secretary CONSUMER ADVISORY COUNCIL Leonor K. Sullivan, St. Louis, Missouri, Chairman William D. Warren, Los Angeles, California, Vice Chairman Roland E. Brandel, San Francisco, California Robert J. Klein, New York, New York Agnes H. Bryant, Detroit, Michigan Percy W. Loy, Portland, Oregon John G. Bull, Fort Lauderdale, Florida R. C. Morgan, El Paso, Texas Robert V. Bullock, Frankfort, Kentucky Reece A. Overcash, Jr., Dallas, Texas Linda M. Cohen, Washington, D.C. Raymond J. Saulnier, New York, New York Robert R. Dockson, Los Angeles, California E. G. Schuhart, Dalhart, Texas Anne G. Draper, Washington, D.C. Blair C. Shick, Cambridge, Massachusetts Carl Felsenfeld, New York, New York James E. Sutton, Dallas, Texas Jean A. Fox, Pittsburgh, Pennsylvania Thomas R. Swan, Portland, Maine Richard H. Holton, Berkeley, California Anne Gary Taylor, Alexandria, Virginia Edna DeCoursey Johnson, Baltimore, Maryland Richard D. Wagner, Simsbury, Connecticut Richard F. Kerr, Cincinnati, Ohio Richard L. Wheatley, Jr., Stillwater, Oklahoma Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A73 Federal Reserve Banks, Branches, and Offices FEDERAL RESERVE BANK, Chairman President Vice President branch, or facility Zip Deputy Chairman First Vice President in charge of branch BOSTON* .................. 02106 Louis W. Cabot Frank E. Morris Robert M. Solow James A. McIntosh NEW YORK* 10045 Robert H. Knight Paul A. Volcker Boris Yavitz Thomas M. Timlen Buffalo .................... 14240 Donald R. Nesbitt John T. Keane PHILADELPHIA 19105 John W. Eckman David P. Eastburn Werner C. Brown Richard L. Smoot CLEVELAND* 44101 Robert E. Kirby Willis J. Winn Otis A. Singletary 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 Maceo A. Sloan George C. Rankin Baltimore ....................21203 I. E. Killian Jimmie R. Monhollon Charlotte ....................28230 Robert C. Edwards Stuart P. Fishburne Culpeper Communications and Records Center.. 22701 Albert D. Tinkelenberg ATLANTA .................. 30303 Clifford M. Kirtland, Jr. Monroe Kimbrel William A. Fickling, Jr. Kyle K. Fossum Birmingham ............ 35202 Harold B. Blach, Jr. Hiram J. Honea Jacksonville ............ 32203 James E. Lyons Edward C. Rainey Miami ....................... 33152 Alvaro L. Carta F. J. Craven, Jr. Nashville .................. 37203 John C. Bolinger Jeffrey J. Wells New Orleans ........... 70161 Edwin J. Caplan George C. Guynn CHICAGO* ................ 60690 Robert H. Strotz Robert P. Mayo John Sagan Daniel M. Doyle Detroit ....................... 48231 Jordan B. Tatter William C. Conrad ST. LOUIS .................. 63166 Armand C. Stalnaker Lawrence K. Roos William B. Walton Donald W. Moriarty Little Rock .............. 72203 G. Larry Kelley John F. Breen Louisville ................ 40201 James H. Davis Donald L. Henry Memphis .................. 38101 Jeanne L. Holley 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 Christine H. Anthony 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 Josefina Salas-Porras Fredric W. Reed Houston .................... 77001 Alvin I. Thomas J. Z. Rowe San Antonio ............ 78295 Pete Morales, Jr. Carl H. Moore SAN FRANCISCO ....94120 Joseph F. Alibrandi John J. Balles Cornell C. Maier John B. Williams Los Angeles ............ 90051 Caroline L. Ahmanson 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 Gerald R. Kelly ♦Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; Cranford, New Jersey 07016; Jericho, New York 11753; Utica, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West Virginia 25311; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A 74 Federal Reserve Board Publications Available from Publications Services, Division of Ad request and be made payable to the order of the Board ministrative Services, Board of Governors of the Fed of Governors of the Federal Reserve System in a form eral Reserve System, Washington, D.C. 20551. Where collectible at par in U.S. currency. (Stamps and a charge is indicated, remittance should accompany coupons are not accepted.) The Federal Reserve System—Purposes and Bank Credit-Card and Check-Credit Plans. 1968. Functions. 1974. 125 pp. 102 pp. $1.00 each; 10 or more to one address, Annual Report $.85 each. Federal Reserve Bulletin. Monthly. $20.00 per Survey of Changes in Family Finances. 1968. 321 year or $2.00 each in the United States, its posses pp. $1.00 each; 10 or more to one address, $.85 sions, Canada, and Mexico; 10 or more of same each. issue to one address, $18.00 per year or $1.75 Report of the Joint Treasury-Federal Reserve each. Elsewhere, $24.00 per year or $2.50 each. Study of the U.S. Government Securities Banking and Monetary Statistics, 1914-1941. Market. 1969. 48 pp. $.25 each; 10 or more to (Reprint of Part 1 only) 1976. 682 pp. $5.00. one address, $.20 each. Banking and Monetary Statistics, 1941-1970. 1976. 1,168 pp. $15.00. Joint Treasury-Federal Reserve Study of the Annual Statistical Digest, 1971-75. 1976. 339 pp. Government Securities Market: Staff Stud $4.00 per copy for each paid subscription to Fed ies—Part 1. 1970. 86 pp. $.50 each; 10 or more eral Reserve Bulletin. All others, $5.00 each. to one address, $.40 each. Part 2. 1971. 153 pp. Annual Statistical Digest, 1972-76. 1977. 388 pp. and Part 3. 1973. 131 pp. Each volume $1.00; $10.00 per copy. 10 or more to one address, $.85 each. Federal Reserve Monthly Chart Book. Subscrip Open Market Policies and Operating Proce tion includes one issue of Historical Chart Book. dures—Staff Studies. 1971. 218 pp. $2.00 $ 12.00 per year or $ 1.25 each in the United States, each; 10 or more to one address, $1.75 each. its possessions, Canada, and Mexico; 10 or more Reappraisal of the Federal Reserve Discount of same issue to one address, $1.00 each. Else Mechanism. Vol. 1. 1971. 276 pp. Vol. 2. 1971. where, $15.00 per year or $1.50 each. 173 pp. Vol. 3. 1972. 220 pp. Each volume $3.00; Historical Chart Book. Issued annually in Sept. 10 or more to one address, $2.50 each. Subscription to Monthly Chart Book includes one issue. $1.25 each in the United States, its posses The Econometrics of Price Determination Con sions, Canada, and Mexico; 10 or more to one ference, October 30-31, 1970, Washington, D.C. 1972. 397 pp. Cloth ed. $5.00 each; 10 or more address, $1.00 each. Elsewhere, $1.50 each. to one address, $4.50 each. Paper ed. $4.00 each; Capital Market Developments. Weekly. $15.00 per 10 or more to one address, $3.60 each. year or $.40 each in the United States, its posses sions, Canada, and Mexico; 10 or more of same Federal Reserve Staff Study: Ways to Moderate issue to one address, $13.50 per year or $.35 each. Fluctuations in Housing Construction. 1972. Elsewhere, $20.00 per year or $.50 each. 487 pp. $4.00 each; 10 or more to one address, Selected Interest and Exchange Rates—Weekly $3.60 each. Series of Charts. Weekly. $15.00 per year or Lending Functions of the Federal Reserve $.40 each in the United States, its possessions, Banks. 1973. 271 pp. $3.50 each; 10 or more Canada, and Mexico; 10 or more of same issue to one address, $3.00 each. to one address, $13.50 per year or $.35 each. Improving the Monetary Aggregates (Report of the Elsewhere, $20.00 per year or $.50 each. Advisory Committee on Monetary Statistics). The Federal Reserve Act, as amended through De 1976. 43 pp. $1.00 each; 10 or more to one cember 1976, with an appendix containing provi address, $.85 each. sions of certain other statutes affecting the Federal Annual Percentage Rate Tables (Truth in Lend Reserve System. 307 pp. $2.50. ing—Regulation Z) Vol. I (Regular Transactions). Regulations of the Board of Governors of the 1969. 100 pp. Vol. II (Irregular Transactions). Federal Reserve System 1969. 116 pp. Each volume $1.00, 10 or more Published Interpretations of the Board of Gov of same volume to one address, $.85 each. ernors, as of June 30, 1977. $7.50. Federal Reserve Measures of Capacity and Capac Industrial Production—1976 Edition. 1977 . 304 pp. ity Utilization. 44 pp. $1.75 each, 10 or more to one $4.50 each; 10 or more to one address, $4.00 each. address, $1.50 each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Federal Reserve Board Publications A 75 CONSUMER EDUCATION PAMPHLETS Revision of Bank Credit Series. 12/71. Assets and Liabilities of Foreign Branches of (Short pamphlets suitable for classroom use. Multiple U.S. Banks. 2/72. copies available without charge.) Bank Debits, Deposits, and Deposit Turnover— Revised Series. 7/72. The Equal Credit Opportunity Act and . . . Age Yields on Newly Issued Corporate Bonds. 9/72. The Equal Credit Opportunity Act and . . . Recent Activities of Foreign Branches of U.S. Credit Rights in Housing Banks. 10/72. The Equal Credit Opportunity Act and . . . Revision of Consumer Credit Statistics. 10/72. Doctors, Lawyers, Small Retailers, and One-Bank Holding Companies Before the 1970 Others Who May Provide Incidental Credit Amendments. 12/72. The Equal Credit Opportunity Act and . . . Yields on Recently Offered Corporate Bonds. Women 5/73. Fair Credit Billing Credit-Card and Check-Credit Plans at Commer If You Borrow To Buy Stock cial Banks. 9/73. U.S. Currency Rates on Consumer Instalment Loans. 9/73. What Truth in Lending Means to You New Series for Large Manufacturing Corpora tions. 10/73. STAFF ECONOMIC STUDIES U.S. Energy Supplies and Uses, Staff Economic Studies and papers on economic and financial subjects Study by Clayton Gehman. 12/73. that are of general interest in the field of economic Inflation and Stagnation in Major Foreign In research. dustrial Countries. 10/74. The Structure of Margin Credit. 4/75. Summaries Only Printed in the Bulletin New Statistical Series on Loan Commitments at (Limited supply of mimeographed copies of full text Selected Large Commercial Banks. 4/75. available upon request for single copies.) Recent Trends in Federal Budget Policy. 7/75. Recent Developments in International Financial Recent Trends in Local Banking Market Struc Markets. 10/75. ture, by Samuel H. Talley. May 1977. 26 pp. MINNIE: A Small Version of the The Performance of Bank Holding Company- MIT-PENN-SSRC Econometric Model, Staff Affiliated Finance Companies, by Stephen A. Economic Study by Douglas Battenberg, Jared J. Rhoades and Gregory E. Boczar. Aug. 1977. 19 pp. Enzler, and Arthur M. Havenner. 11/75. Greeley in Perspective, by Paul Schweitzer and Joshua An Assessment of Bank Holding Companies, Staff Greene. Sept. 1977. 17 pp. Economic Study by Robert J. Lawrence and Structure and Performance Studies in Banking: A Samuel H. Talley. 1/76. Summary and Evaluation, by Stephen A. Industrial Electric Power Use. 1/76. Rhoades. Dec. 1977. 45 pp. Revision of Money Stock Measures. 2/76. An Analysis of Federal Reserve Attrition Since Survey of Finance Companies, 1975. 3/76. 1960, by John T. Rose. Jan. 1978. 44 pp. Revised Series for Member Bank Deposits and Problems in Applying Discriminant Analysis in Aggregate Reserves. 4/76. Credit Scoring Models, by Robert A. Eisenbeis. Industrial Production—1976 Revision. 6/76. Jan. 1978. 28 pp. Federal Reserve Operations in Payment Mecha External Capital Financing Requirements of nisms: A Summary. 6/76. Commercial Banks: 1977-81, by Gerald A. Han- Recent Growth in Activities of U.S. Offices of weck and John J. Mingo. Feb. 1978. 34 pp. Banks. 10/76. Printed in Full in the Bulletin New Estimates of Capacity Utilization: Manu Staff Economic Studies shown in list below. facturing and Materials. 11/76. REPRINTS U.S. International Transactions in a Recovering Economy. 4/77. (Except for Staff Papers, Staff Economic Studies, and Bank Holding Company Financial Developments some leading articles, most of the articles reprinted do in 1976. 4/77. not exceed 12 pages.) Changes in Bank Lending Practices, 1976. 4/77. A Revised Index of Manufacturing Capacity, Survey of Terms of Bank Lending—New Series. Staff Economic Study by Frank de Leeuw with 5/77. Frank E. Hopkins and Michael D. Sherman. 1 1/66. The Commercial Paper Market. 6/77. U.S. International Transactions: Trends in Consumption and Fixed Investment in the Eco 1960-67. 4/68. nomic Recovery Abroad. 10/77. Measures of Security Credit. 12/70. Survey of Time and Savings Deposits at All Com Revised Measures of Manufacturing Capacity mercial Banks, October 1977. 2/78. Utilization. 10/71. U.S. International Transactions. 4/78. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A76 Index to Statistical Tables References are to pages A-3 through A-68 although the prefix “A” is omitted in this index ACCEPTANCES, bankers, 11, 25, 27 Demand deposits: Agricultural loans, commercial banks, 18, 20-22, 26 Adjusted, commercial banks, 13, 15, 19 Assets and liabilities (See also Foreigners): Banks, by classes, 16, 17, 19, 20-23 Banks, by classes, 16, 17, 18, 20-23, 29 Ownership by individuals, partnerships, and Domestic finance companies, 39 corporations, 25 Federal Reserve Banks, 12 Subject to reserve requirements, 15 Nonfinancial corporations, current, 38 Turnover, 13 Automobiles: Deposits (5W also specific types of deposits): Consumer instalment credit, 42, 43 Banks, by classes, 3, 16, 17, 19, 20-23, 29 Production, 48, 49 Federal Reserve Banks, 4, 12 Subject to reserve requirements, 15 Turnover, 13 BANKERS balances, 16, 18, 20, 21, 22 Discount rates at F.R. Banks (See Interest rates) (See also Foreigners) Discounts and advances by F.R. Banks (See Loans) Banks for cooperatives, 35 Dividends, corporate, 38 Bonds (See also U.S. Govt, securities): New issues, 36, 37 EMPLOYMENT, 46, 47 Yields, 3 Euro-dollars, 27 Branch banks: Assets and liabilities of foreign branches of U.S. banks, 62 FARM mortgage loans, 41 Liabilities of U.S. banks to their foreign Farmers Home Administration, 41 branches, 23 Federal agency obligations, 4, 11, 12, 13, 34 Business activity, 46 Federal and Federally sponsored credit agencies, 35 Business expenditures on new plant and Federal finance: equipment, 38 Debt subject to statutory limitation and Business loans (See Commercial and industrial types and ownership of gross debt, 32 Receipts and outlays, 30, 31 loans) Treasury operating balance, 30 Federal Financing Bank, 30, 35 CAPACITY utilization, 46 Federal funds, 3, 6, 18, 20, 21, 22, 27, 30 Capital accounts: Federal home loan banks, 35 Banks, by classes, 16, 17, 19, 20 Federal Home Loan Mortgage Corp., 35, 40, 41 Federal Reserve Banks, 12 Federal Housing Administration, 35, 40, 41 Central banks, 68 Federal intermediate credit banks, 35 Certificates of deposit, 23, 27 Federal land banks, 35, 41 Commercial and industrial loans: Federal National Mortgage Assn., 35, 40, 41 Commercial banks, 15, 18, 23, 26 Federal Reserve Banks: Weekly reporting banks, 20, 21, 22, 23, 24 Condition statement, 12 Commercial banks: Discount rates Interest rates) Assets and liabilities, 3, 15-19, 20-23 U.S. Govt, securities held, 4, 12, 13, 32, 33 Business loans, 26 Federal Reserve credit, 4, 5, 12, 13 Commercial and industrial loans, 24, 26 Federal Reserve notes, 12 Consumer loans held, by type, 42, 43 Federally sponsored credit agencies, 35 Loans sold outright, 23 Finance companies: Number, by classes, 16, 17, 19 Assets and liabilities, 39 Real estate mortgages held, by type of holder and Business credit, 39 property, 41 Loans, 20, 21, 22, 42, 43 Commercial paper, 3, 24, 25, 27, 39 Paper, 25, 27 Condition statements (Sev Assets and liabilities) Financial institutions, loans to, 18, 20-22 Construction, 46, 50 Float, 4 Consumer instalment credit, 42, 43 Flow of funds, 44, 45 Consumer prices, 46, 51 Foreign: Consumption expenditures, 52, 53 Currency operations, 12 Corporations: Deposits in U.S. banks, 4, 12, 19, 20, 21, 22 Profits, taxes, and dividends, 38 Exchange rates, 68 Security issues, 36, 37, 65 Trade, 55 Cost of living (See Consumer prices) Foreigners: Credit unions, 29, 42, 43 Claims on, 60, 61, 66, 67 Currency and coin, 5, 16, 18 Liabilities to, 23, 56-59, 64-67 Currency in circulation, 4, 14 Customer credit, stock market, 28 GOLD: Certificates, 12 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 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
Federal Reserve Bulletin □ April 1978 A77 HOUSING, new and existing units, 50 REAL estate loans: Banks, by classes, 18, 20-23, 29, 41 INCOME, personal and national, 46, 52, 53 Life insurance companies, 29 Industrial production, 46, 48 Mortgage terms, yields, and activity, 3, 40 Instalment loans, 42, 43 Type of holder and property mortgaged, 41 Insurance companies, 29, 32, 33, 41 Reserve position, basic, member banks, 6 Insured commercial banks, 17, 18, 19 Reserve requirements, member banks, 9 Interbank deposits, 16, 17, 20, 21, 22 Reserves: Interest rates: Commercial banks, 16, 18, 20, 21, 22 Bonds, 3 Federal Reserve Banks, 12 Business loans of banks, 26 Member banks, 3, 4, 5, 15, 16, 18 Federal Reserve Banks, 3, 8 U.S. reserve assets, 55 Foreign countries, 68 Residential mortgage loans, 40 Money and capital markets, 3, 27 Retail credit and retail sales, 42, 43, 46 Mortgages, 3, 40 Prime rate, commercial banks, 26 SAVING: Time and savings deposits, maximum rates, 10 Flow of funds, 44, 45 International capital transactions of the United National income accounts, 53 States, 56-67 Savings and loan assns., 3, 10, 29, 33, 41, 44 International organizations, 56-61, 64-67 Savings deposits (See Time deposits) Inventories, 52 Savings institutions, selected assets, 29 Investment companies, issues and assets, 37 Securities (See also U.S. Govt, securities): Investments (See also specific types of investments): Federal and Federally sponsored agencies, 35 Banks, by classes, 16, 17, 18, 20, 21, 22, 29 Foreign transactions, 65 Commercial banks, 3, 15, 16, 17, 18 New issues, 36, 37 Federal Reserve Banks, 12, 13 Prices, 28 Life insurance companies, 29 Special Drawing Rights, 4, 12, 54, 55 Savings and loan assns., 29 State and local govts.: Deposits, 19, 20, 21, 22 LABOR force, 47 Holdings of U.S. Govt, securities, 32, 33 Life insurance companies (See Insurance companies) New security issues, 36 Loans (See also specific types of loans): Ownership of securities of, 18, 20, 21, 22, 29 Banks, by classes, 16, 17, 18, 20-23, 29 Yields of securities, 3 Commercial banks, 3, 15-18, 20-23, 24, 26 State member banks, 17 Federal Reserve Banks, 3, 4, 5, 8, 12, 13 Stock market, 28 Insurance companies, 29, 41 Stocks also Securities); Insured or guaranteed by U.S., 40, 41 New issues, 36, 37 Savings and loan assns., 29 Prices, 28 TAX receipts, Federal, 31 MANUFACTURING: Time deposits, 3, 10, 13. 15, 16, 17, 19, 20, 21, Capacity utilization, 46 22, 23 Production, 46, 49 Trade, foreign, 55 Margin requirements, 10 Treasury currency, Treasury cash, 4 Member banks: Treasury deposits, 4, 12, 30 Assets and liabilities, by classes, 16, 17, 18 Treasury operating balance, 30 Borrowings at Federal Reserve Banks, 5,12 Number, by classes, 16, 17, 19 UNEMPLOYMENT, 47 Reserve position, basic, 6 U.S. balance of payments, 54 Reserve requirements, 9 U.S. Govt, balances: Reserves and related items, 3, 4, 5, 15 Mining production, 49 Commercial bank holdings, 19, 20, 21, 22 Member bank holdings, 15 Mobile home shipments, 50 Treasury deposits at Reserve Banks, 4, 12, 30 Monetary aggregates, 3, 15 U.S. Govt, securities: Money and capital market rates (See Interest rates) Bank holdings, 16, 17, 18, 20, 21, 22, 29, Money stock measures and components, 3, 14 32, 33 Mortgages (See Real estate loans) Dealer transactions, positions, and financing, 34 Mutual funds (See Investment companies) Federal Reserve Bank holdings, 4, 12, 13, 32, 33 Mutual savings banks, 3, 10, 20-22, 29, 32, 33, 41 Foreign and international holdings and transactions, 12, 32, 64 NATIONAL banks, 17, 19 Open market transactions, 11 National defense outlays, 31 Outstanding, by type of security, 32, 33 National income, 52 Ownership, 32, 33 Nonmember banks, 17, 18, 19 Rates in money and capital markets, 3, 27 Yields, 3 OPEN market transactions, 11 Utilities, production, 49 PERSONAL income, 53 VETERANS Administration, 40, 41 Prices: Consumer and wholesale, 46, 51 WEEKLY reporting banks, 20-24 Stock market, 28 Wholesale prices, 46 Prime rate, commercial banks, 26 Production, 46, 48 Profits, corporate, 38 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis
A78 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories Helena Detr* r - ^ ^ ^ jsalt Lake ( ?ity Omaha*\ i incinnati S o \ / 1 Denve? ® Kansas City® ^ gichm?5"l, v r»' f-------------- harlony "IOklahoma City* ^Memphis Nashvilh A,n8eles *^yjttleRock Birminghaf#®iaflta Dallas® © El Paso (n)^_ ' ~X Houston uSewOrkuns \San Antonio (Mi*** February 1978 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
Cite this document
Federal Reserve (1978, March 31). Federal Reserve Bulletin, 1978-04. Bulletin, Federal Reserve. https://whenthefedspeaks.com/doc/bulletin_197804
@misc{wtfs_bulletin_197804,
author = {Federal Reserve},
title = {Federal Reserve Bulletin, 1978-04},
year = {1978},
month = {Mar},
howpublished = {Bulletin, Federal Reserve},
url = {https://whenthefedspeaks.com/doc/bulletin_197804},
note = {Retrieved via When the Fed Speaks corpus}
}