Federal Reserve Bulletin, 1979-02

FEBRUARY 1979 FEDERAL RESERVE BULLETIN Domestic Financial Developments in the Fourth Quarter of 1978 Check Processing at Federal Reserve Offices Survey of Time and Savings Deposits, October 1978 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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VOLUME 65 • NUMBER 2 • FEBRUARY 1979 FEDERAL RESERVE BULLETIN Board of Governors of the Federal Reserve System Washington, D.C. PUBLICATIONS COMMITTEE Joseph R. Coyne, Chairman • Stephen H. Axilrod • John M. Denkler Janet O. Hart • James L. Kichline • Neal L. Petersen • Edwin M. Truman Michael J. Prell, Staff Director The FEDERAL RESERVE BULLETIN is issued monthly under the direction of the stafl 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 Mendelle T. Berenson. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Table of Contents 87 DOMESTIC FINANCIAL DEVELOPMENTS IN 113 STATEMENTS TO CONGRESS THE FOURTH QUARTER OF 1978 Chairman G. William Miller states that the The quarterly report to the Congress states Federal Reserve approves H.R. 7, the that the Federal Reserve became more Monetary Control Act of 1979, with cerrestrictive in supplying reserves to the tain modifications, before the House banking system because of economic con- Committee on Banking, Finance and ditions and the expansion of the monetary Urban Affairs, January 24, 1979. aggregates in the third quarter. 118 Chairman MHler expresses the views of the Federal Reserve on the nation's eco- 97 CHECK PROCESSING A T FEDERAL RESER VE nomic condition and the need for continu- OFFICES ing toward a balanced budget to slow Based on the Federal Reserve's May 1978 inflation, before the House Committee on survey of its check-clearing function, the the Budget, January 25, 1979. average dollar value of an interzone check 122 Governor Philip E. Coldwell points out is twice that of the more common locally that the Federal Reserve's budget for 1979 deposited item; member banks deposit has been prepared in accordance with a most of the checks; and funds are normally policy of reducing resource expenditures available the day after deposit. while maintaining a high quality of service to the public, before the Senate Committee 104 SURVEY OF TIME AND SAVINGS DEPOSITS on Banking, Housing and Urban Affairs, AT COMMERCIAL BANKS, OCTOBER 1978 January 26, 1979. Total time and savings deposits at insured commercial banks expanded more than 2Vi 127 Chairman Miller presents the Federal Repercent over the most recent survey pe- serve's view of the nation's economic riod. progress in annual hearings on the state of the economy, before the Joint Economic Committee of the U.S. Congress, 110 STAFF STUDY January 30, 1979. Summary of 4'Tie-Ins between the Granting of Credit and Sale of Insurance by 130 Governor Nancy H. Teeters describes Bank Holding Companies and Other seven recommendations of the Federal Lenders" presents the findings of a study Reserve for the simplification of truth in of the existence and extent of tying be- lending, before the Senate Committee on tween the granting of credit and the sale Banking, Housing and Urban Affairs, of insurance by retailers, bank holding February 2, 1979. companies, and other financial institu- 133 Governor Henry C. Wallich states that the tions. Federal Reserve supports the extension of the authority of the Council on Wage and 112 INDUSTRIAL PRODUCTION Price Stability to 1981, before the Senate Output rose an estimated 0.1 percent in Committee on Banking, Housing and January. Urban Affairs, February 8, 1979. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

137 ANNOUNCEMENTS a range of 93A to IOV2 percent. With regard to the objective for the rate within that Issuance of statement about improvement range, the committee instructed the manof quality and public understanding of ager to be guided by ranges of tolerance Federal Reserve regulations. for the annual rates of growth of M-1 and Transfer of minutes of Federal Open Mar- M-2 of 2 to 6 percent and 5 to 9 percent, ket Committee meetings to National Ar- respectively. However, the committee dechives. cided that the manager should respond Adoption of consumer affairs and civil more quickly to relatively high than to rights compliance program for member relatively low rates of growth in the agbanks. gregates. Specifically, the objective for the funds rate was to be raised in an orderly Issuance of policy statement and revision fashion within its range if the two-month of Regulation Y to implement the Change growth rates of M-l and M-2 appeared to in Bank Control Act of 1978. (See Law be significantly above the midpoints of the Department.) indicated ranges. On the other hand, the Establishment of nationwide rating system objective was to be lowered in an orderly for bank holding companies. fashion only if the two-month growth rates Adoption of statement of policy concern- appeared to be approaching the lower ing remote disbursement (abuse of the limits of the indicated ranges. check collection system). On December 29, 1978, the committee Issuance of statement about the Commu- modified the instruction to the manager to nity Reinvestment Act by the four federal call for open market operations directed supervisors of financial institutions at maintaining the weekly average federal responsible for enforcement. funds rate at about 10 percent or slightly above. Revision of the money stock and related measures. 157 LAW DEPARTMENT Proposed statement of customer rights under the Right to Financial Privacy Act Amendment to Regulation Y, various of 1978; proposed regulations to carry out rules and bank holding company and bank the Depository Institution Management merger orders, and pending cases. Interlocks Act; and proposed suspension of an amendment to Regulation Z con- A1 FINANCIAL AND BUSINESS STATISTICS cerning pledging of homes as security for A3 Domestic Financial Statistics open-end credit arrangements. A46 Domestic Nonfinancial Statistics Meeting of Consumer Advisory Council. A54 International Statistics Changes in Board Staff. A69 GUIDE TO TABULAR PRESENTATION Admission of four banks to membership AND STATISTICAL RELEASES in the Federal Reserve System. A70 BOARD OF GOVERNORS AND STAFF 145 RECORD OF POLICY ACTIONS OF THE A72 OPEN MARKET COMMITTEE AND STAFF; FEDERAL OPEN MARKET COMMITTEE ADVISORY COUNCILS At the meeting on December 19, 1978, A73 FEDERAL RESERVE BANKS, BRANCHES, the committee agreed to instruct the man- AND OFFICES ager to direct open market operations toward raising the federal funds rate to 10 A74 FEDERAL RESERVE BOARD PUBLICATIONS percent or slightly higher early in the pe- A76 INDEX TO STATISTICAL TABLES riod before the next regular meeting and subsequently to maintain the rate within A78 MAP OF FEDERAL RESERVE SYSTEM Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments in the Fourth Quarter of 1978 This report, which was sent to the Joint Eco- the dollar in foreign exchange markets. On that nomic Committee of the U.S. Congress, high- date, the Federal Reserve also announced a lights the important developments in domestic supplementary reserve requirement of 2 perfinancial markets during the fall and early centage points on large-denomination time dewinter. posits at member banks; this action was taken in an effort to curb the expansion of bank credit The pace of the nation's economic activity ad- and to encourage borrowing by member banks vanced considerably further during the fourth from abroad, thereby strengthening the demand quarter, inflationary pressures remained strong, for dollar-denominated assets in Euromarkets. and early in the quarter the dollar continued Short-term interest rates generally rose in line under substantial downward pressure in foreign with the upward movements in "the federal funds exchange markets. To control inflation and to and discount rates over the fourth quarter. The help arrest the excessive depreciation of the increases in Treasury bill rates, however, were dollar, monetary restraint was intensified. The held down somewhat by demands of foreign rate of growth in bank reserves moderated in central banks that were investing the dollar the fourth quarter and into early 1979, and the proceeds of exchange market intervention. At federal funds rate increased about P/2 percent- the same time, rates on private short-term inage points from September to January. struments were subject to especially strong up- The discount rate was boosted a similar ward pressures from substantial issuance of amount, including an increase of 1 percentage commercial paper and negotiable certificates of point initiated on November 1 as part of a joint deposit (CDs); recently, these rates have de- Federal Reserve-Treasury program to support clined somewhat from their year-end peaks. Interest rates NOTES: Percent per annum Monthly averages except for SHORT-TERM Federal Reserve discount rate and conventional mortgages (based on quotations for one day each month). Yields: U.S. Treasury bills, market yields on three-month issues; prime commercial paper, dealer ottering rates; conventional mortgages, rates on first mortgages in primary markets, unweighted and rounded to nearest 5 basis points, from Department of Housing and Urban Development; Aaa utility bonds, weighted averages of new publicly offered bonds rated Aaa, Aa, and A by Moody's Investors Service and adjusted to Aaa basis; U.S. government bonds, market yields adjusted to 20-year constant maturity by U.S. Treasury; state and local government bonds (20 issues, mixed quality), Bond Buyer. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

88 Federal Reserve Bulletin • February 1979 Reflecting the higher cost of funds, the bank reflecting in part shifts of funds out of demand prime rate was increased more than 2 percentage deposits associated with the authorization of points, to 11% percent. automatic transfers from savings accounts as Long-term rates moved about 1/2 of a per- well as the cumulative impact of higher interest centage point higher during the fourth quarter, rates on the demand for money. Growth in the in response not only to the rise in short-term interest-earning components of the broader rates but also to the continuing high rate of measures of the money stock, M-2 and M-3, inflation and the evidence of sustained strength slowed substantially as the quarter progressed, in the economy. Stock prices fell sharply in late although on average for the entire quarter their October, but reversed a portion of that decline rates of expansion were little changed from the over the balance of the quarter and in January previous quarter. Time and savings deposits as the dollar strengthened on foreign exchange subject to fixed-rate ceilings declined, but sales markets and as corporations reported substantial of six-month money market certificates (MMCs) increases in dividends and fourth-quarter earn- were quite strong, as was the issuance of large ings. time deposits included in these aggregates. Growth in M-1 slowed markedly in the fourth As a result of these somewhat disparate quarter and remained quite weak in January, movements, all three major monetary aggre- Changes in selected monetary aggregates 1 Seasonally adjusted annual rate of change, in percent 1977 1978 IItteemm 11997766 11997777 11997788 Q4 Ql Q2 Q3 Q4 Member bank reserves2 Total .6 5.3 6.9 6.3 8.9 6.2 8.6 3.1 Nonborrowed .8 3.0 6.9 3.8 14.5 .6 6.6 5.4 Concepts of money3 M-l 5.8 7.9 7.3 7.4 6.6 9.2 8.1 4.4 M-l + 12.6 9.3 5.3 6.6 5.0 7.2 6.0 2.5 M-2 10.9 9.8 8.5 7.9 7.0 8.4 9.9 1.1 M-3 12.7 11.7 9.4 10.1 8.1 8.4 10.4 9.4 M-4 7.1 10.1 10.5 10.4 10.2 10.6 10.1 9.4 M-5 10.2 11.7 10.5 11.5 10.0 9.8 10.5 10.3 Time and savings deposits at commercial banks—Total (excluding large negotiable CDs) 15.0 11.2 9.4 8.3 7 2 7.9 11.1 10.3 Savings 25.0 11.1 1.8 5.4 2.0 3.8 2.3 -.9 Other time 7.5 11.4 16.1 10.9 11.7 11.4 18.5 19.3 Small time plus total savings4 19.2 10.5 5.6 4.3 3 1 5.9 6.6 6.1 Deposits at thrift institutions5 15.6 14.5 10.6 13.2 9.7 8.5 11.1 11.7 MEMO (change in billions of dollars, seasonally adjusted): Large negotiable CDs at large banks -19.1 8.0 23.1 6.6 8.4 6.6 2.6 5.5 All other large time deposits6 -.8 10.8 22.7 5.4 5.5 3.6 7.0 6.6 Small time deposits 16.4 14.5 17.3 1.2 1.8 3.8 5.1 6.6 Nondeposit sources of funds7 14.8 12.3 14.8 4.5 5.2 .9 2.3 6.7 1. Changes are calculated from the average amounts out- 4. Interest-bearing deposits subject to Regulation Q. standing in each quarter. 5. Savings and loan associations, mutual savings banks, and 2. Annual rates of change in reserve measures have been credit unions. adjusted for changes in reserve requirements. 6. Total large time deposits less negotiable CDs at weekly 3. M-l is currency plus private demand deposits adjusted. reporting banks. M-l + is M-l plus savings deposits at commercial banks, NOW 7. Nondeposit sources of funds include borrowings by accounts at banks and thrift institutions, credit union share draft commercial banks from other than commercial banks in the accounts, and demand deposits at mutual savings banks. M-2 form of federal funds purchased, securities sold under agreeis M-l plus bank time and savings deposits other than large ments to repurchase, and other liabilities to own foreign negotiable CDs. M-3 is M-2 plus deposits at mutual savings branches (Eurodollar borrowings), loans sold to affiliates, loan banks and savings and loan associations and credit union repurchase agreements, borrowings from Federal Reserve shares. M-4 is M-2 plus large negotiable CDs. M-5 is M-3 Banks, and other minor items. plus large negotiable CDs. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q4 1978 89 gates expanded in the fourth quarter at rates Changes in income velocitv of M-l and M-2 consistent with the long-run ranges set by the Federal Open Market Committee for the period from the third quarter of 1978 to the third quarter of 1979. For M-2 and M-3, these ranges were 6*/2 to 9 percent and IV2 to 10 percent, respectively. The growth of M-l, which the committee recognized would be affected by the introduction of automatic transfer services, was expected to fall within a range of 2 to 6 percent. Aggregate credit flows to nonfinancial sectors totaled around $390 billion at an annual rate in the fourth quarter, somewhat below the pace of the preceding three months. Public-sector borrowing declined, as the Treasury drew down its cash balances to finance a portion of the federal deficit and as bond issuance by state and local governments fell with a decrease in advance-refunding operations. Nonfinancial busi- Seasonally adjusted annual rates. Money stock data are nesses stepped up their short- and interme- quarterly averages. diate-term borrowing, which more than offset a decline in offerings of long-term securities. terest-bearing assets. However, the slowing of Consumer credit expanded somewhat more rap- growth in M-l during the fourth quarter and into idly than in the third quarter, and the volume early 1979 exceeded the amount implied by of home mortgage financing also increased, historical relationships among M-l, GNP, and spurred by greater lending at thrift institutions. interest rates. Some, but not all, of the greater slowdown can be explained by shifts of funds at commercial banks from demand deposits to MONETARY AGGREGATES household savings accounts eligible for automatic transfer services (ATS), authorized on AND BANK CREDIT November 1. Transfers to ATS savings accounts Growth in M-l slowed markedly in the fourth are estimated to have reduced growth in M-l quarter to an annual rate of 4V2 percent on a for the quarter as a whole about 1 percentage quarterly-average basis, down from an average point at an annual rate. By the end of December, of 8 percent over the first three quarters of the more than a third of all commercial banks were year. On a monthly basis, M-l was little offering ATS savings accounts, and the balances changed on balance over the quarter, as moder- outstanding in such accounts were estimated to ate growth in October and December was about total more than $3 billion. Something over half offset by a decline in November. The modera- of these balances were thought by the banks tion in the growth of M-l occurred despite a surveyed to have been shifted from demand pick-up in the pace of expansion of nominal deposit accounts. gross national product, and thus the velocity of Despite transfers into ATS savings accounts, M-l rose at an annual rate of about 9VI percent total savings deposits at commercial banks dein the fourth quarter, well above the 1XA percent clined nearly 1 percent (annual rate) in the rate of the preceding quarter. fourth quarter—the first quarterly decline since The principal cause for the slowdown in M-l early 1970—as the spread between yields on growth apparently was the sustained rise over Treasury bills and the maximum allowable yield recent months in market interest rates, which on savings deposits reached a record AV2 perencouraged the public to economize on non-in- centage points by the end of the year. The Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

90 Federal Reserve Bulletin • February 1979 Treasury yield curves and deposit rate ceilings $1V2 billion in the third quarter. Even with the maturing in December of more than $2 billion Percent per annum of MMCs issued by commercial banks in June, when such accounts were first authorized, banks maintained strong net gains in these deposits. Meanwhile, other small time deposits maturing in less than four years continued to decline during the fourth quarter, while small time deposits with longer maturities were essentially unchanged after having risen slowly over the preceding three months. Outflows from time accounts subject to fixed regulatory interest rate ceilings reflected further increases in market rates above such ceilings, which caused shifting of funds to MMCs as well as to market instruments. By the end of the year, MMCs accounted for more than 534 percent of all small-denomination time and savings deposits at commercial banks. Although a substantial portion of MMC balances undoubtedly repre- + Maximum yield on "money market" time deposits at sents deposits that would have been held in other thrift institutions. * Maximum yield on "money market" time deposits at types of commercial bank accounts, the MMC commercial banks. also has enabled banks to retain funds that might Data reflect annual effective yields. Ceiling rates are yields derived from continuous compounding of the nominal ceiling otherwise have been diverted to market instrurates. Market yield data are on an investment yield basis. ments. The relative attractiveness to small savers of financial instruments ottering market weakening in savings flows was concentrated in rates of interest was evidenced by a rise in accounts held by individuals and nonprofit in- noncompetitive tenders for Treasury securities stitutions. With the drop in savings deposits, and a sharp increase in net sales of shares in the newly defined monetary aggregate, M-1 + , money market mutual funds. grew at a rate of only 2Vi percent, down from Issuance of MMCs also rose at savings and 6 percent in the third quarter. M-l + , which has loan associations and mutual savings banks, been defined as M-l plus all savings accounts boosting deposit growth at thrift institutions in at commercial banks and checkable deposits at the fourth quarter to an annual rate of 113A thrift institutions, serves as a supplemental percent on a quarterly-average basis, up from measure of transactions balances during the pe- 11 percent the preceding quarter. As a result, riod of adjustment to ATS accounts. expansion of M-3 fell only slightly on average The slowdown in the rate of expansion of M-2 from its pace in the third quarter. However, was more moderate than the deceleration in the growth of thrift deposits slowed in each month narrower monetary aggregates; growth in total of the quarter, dropping from almost 14 percent small-denomination time deposits picked up in September to an estimated 9!/2 percent in somewhat in the fourth quarter to an annual rate December. During the final three months of the of 6V2 percent, while the rate of increase of large year, thrift institutions attracted $28 billion of time deposits included in M-2 slowed only new MMCs compared with $181/2 billion in the slightly. The stronger growth of small time third quarter. Like commercial banks, these deposits was attributable to large net inflows of institutions evidently had little difficulty rolling funds to MMCs at commercial banks, the ceil- over maturing MMCs at prevailing rates in ing rate on which varies weekly with the rate December, and by year-end MMCs accounted set in auctions of six-month Treasury bills; the for more than 9 percent of total deposits at growth in these accounts amounted to $1314 savings and loan associations and mutual savbillion, not seasonally adjusted, compared with ings banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q4 1978 91 In the face of reduced growth in the fourth the financing gap at about its third-quarter level. quarter in the deposits included in the major Businesses reduced their borrowing in bond monetary aggregates, banks stepped up their use markets in the fourth quarter but continued to of managed liabilities—both nondeposit sources make substantial use of mortgages as a source of funds and large-denomination time deposits of long-term credit. Despite a reduction in the not subject to rate ceilings—in order to maintain growth of business loans at commercial banks, rapid expansion of loan portfolios. Banks tapped total short- and intermediate-term business nondeposit sources for $6% billion in the fourth credit accelerated due to a sharp rise in issuance quarter compared with $2XA billion in the pre- of commercial paper and a near-record increase ceding three months. These funds consisted in borrowing from finance companies. Much of largely of security repurchase agreements and the increase in finance company loans to busifederal funds purchased from nonbank sources. nesses reflected automotive-related credit, in- Gross Eurodollar borrowings from foreign cluding financing of dealer inventories of autobranches also rose; but because banks increased mobiles and retail sales of commercial vehicles. claims on such branches by a like amount, the The reduced lending to business by commerdomestic banking system on balance acquired cial banks was accompanied by a cumulative only a small amount of funds from foreign increase of 2 percentage points in the prime rate branches. Large banks issued $51/2 billion of during the October-December period, bringing negotiable CDs—not included in M-2—up from the rate close to the record 12 percent set in the net rise of $2l/z billion in the preceding three 1974. In addition, data available for large banks months. Total managed liabilities as a percent indicate that nonprice loan terms and standards of net assets at large banks increased over the of creditworthiness tightened. Large banks fourth quarter, nearing the previous peak reportedly also became less aggressive in the reached in 1974. In addition to the traditional fourth quarter in granting below-prime loans nondeposit sources of funds, on November 2 and, in light of uncertainty surrounding future banks began to acquire Treasury note balances interest rates, in making fixed-rate loans. under the new tax-and-loan-account program. During the final two months of the year, balances in such accounts averaged more than $6 Components of Major categories of bank credit bank loans billion. Change, billions of dollars Growth in total loans at commercial banks TREASURY SECURITIES picked up slightly in the fourth quarter, primarily reflecting increased lending to consumers. The expansion of real estate loans nearly matched the strong pace of the previous two quarters, while that of business loans, OTHER SECURITIES which had held at the third-quarter pace in October and November, ceased in December. n .n n n To help finance their loan expansion, banks TOTAL LOANS allowed holdings of Treasury securities—particularly those maturing in one year or more—to fall sharply, while the growth of their portfolios of other securities moderated. Over all, the expansion of bank credit decelerated to an annual rate of 6 percent in the fourth quarter. BUSINESS FINANCE Q4 Q1 Q2 Q3 Q4 Q4 Q1 Q2 Q3 Q4 1977 1978 1977 1978 Both capital expenditures and internally generated funds at nonfinancial corporations in- Seasonally adjusted. Total loans and business loans adjusted for transfer between banks and their holding companies, affilicreased slightly in the fourth quarter, leaving ates, subsidiaries, or foreign branches. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

92 Federal Reserve Bulletin • February 1979 Business loans and short- continued to account for a large portion of total and intermediate-term business credit new issues. Financial corporations, on the other Seasonally adjusted annual rate of change, in percent hand, increased their public bond offerings moderately during the fourth quarter, mainly Business loans owing to a rise in sales of securities by finance at banks 1 TToottaall sshhoorrtt-- aanndd companies. PPeerriioodd Excluding iinntteerrmmeeddiiaattee--tteerrmm Private placements of corporate bonds, bank holdings bbuussiinneessss ccrreeddiitt22 Total of bankers mostly issues of manufacturing and industrial acceptances concerns with ratings less than Aa, are estimated to have decreased somewhat from the relatively 1975—Ql.. -5.2 -7.4 -4.4 Q2.. -8.7 -9.0 -8.9 strong pace of other recent quarters. Nonethe- Q3.. -2.4 -2.9 -.5 less, the volume of bond issuance by lower- Q4.. -2.3 -3.9 rated corporations remained sizable by historical 1976—Ql.. -6.9 -6.6 -1.2 standards, reflecting in part the availability of Q2.. 1.6 2.1 5.9 loanable funds at major institutional investors Q3.. 5.3 2.8 2.3 Q4.. 10.6 9.7 12.8 such as life insurance companies and pension funds, many of which traditionally purchase the 1977—Q1.. 11.2 13.3 14.6 Q2.. 12.8 12.9 16.1 securities of such corporations. In addition, the Q3.. 11.2 10.4 10.4 continued strength in issuance of privately Q4.. 11.7 12.6 16.4 placed corporate bonds may have been en- 1978—Ql.. ' 15.3 16.8 14.8 couraged by the still relatively low risk pre- Q2.. 17.4 17.9 17.4 Q3.. 10.3 10.3 9.1 miums associated with these securities. The Q4.. 6.7 8.6 15.5 spread between lower-rated (Baa) and higherrated (Aaa) corporate bonds remained relatively 1. Based on data for last Wednesday of month, adjusted narrow during the fourth quarter, despite the for outstanding amounts of loans sold to affiliates. 2. Short- and intermediate-term business credit is business upward movement in long-term interest rates in loans at commercial banks excluding bank holdings of bankers 1978. acceptances plus nonfinancial company commercial paper and finance company loans to businesses measured from end of Yields on corporate bonds increased apprequarter to end of quarter. ciably, on balance, over the fourth quarter. New issues of Aaa-rated utility bonds yielded 9.55 Gross offerings of bonds and stocks by both percent in early January, almost 3/4 of a pernonfinancial and financial corporations slowed centage point more than at the end of Septo a seasonally adjusted annual rate of $41 tember. Nevertheless, corporate bond yields rebillion, down from $57 billion in the third Gross offerings of new security issues quarter and about in line with the low levels Seasonally adjusted annual rates, in billions of dollars recorded in the first half of 1978. In the public bond market, offerings by industrial corpora- 1977 1978 tions declined from already moderate levels, as major corporations with relatively high bond TTyyppee ooff sseeccuurriittyy Q4 Ql Q2 Q3,Jf Q4< ratings (Aa and above) refrained from offering Corporate, total 59 39 46 57 41 new issues. Such firms appear to have been Bonds 43 32 36 45 33 Publicly ottered 24 16 19 28 19 reluctant to issue call-protected, long-term debt Privately placed.. 19 16 17 17 14 at the relatively high nominal interest rates pre- Stocks , 16 7 10 12 8 vailing in 1978; instead, they relied heavily on Foreign 5 5 12 6 5 short-term borrowing, further eroding their li- State and local quidity positions. While reducing their public government 46 44 50 53 43 bond offerings in the fourth quarter, public p Preliminary, utilities, especially communications concerns, e Estimated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q4 1978 93 mained below their 1974 highs, in contrast to the wake of the substantial drop in stock prices rates paid on long-term Treasury securities, early in the quarter. The fall in stock prices and which surpassed record highs early in the quar- the increase in corporate earnings further deter. pressed price-earnings ratios for most corpora- Stock prices generally declined in the fourth tions from already low levels. As a result, total quarter, following the pronounced gains re- equity issuance declined markedly in the fourth corded earlier in the year. In late October, stock quarter. prices moved sharply lower in apparent reaction to further weakness in the foreign exchange GOVERNMENT FINANCE value of the dollar, heightened uncertainty about the outlook for inflation and economic activity, Gross bond sales by state and local governments and additional increases in interest rates. Fol- declined significantly in the fourth quarter from lowing the announcement on November 1 of the the near-record level of the third quarter. The joint Treasury-Federal Reserve program to stem large decrease in the volume of tax-exempt the decline in the foreign exchange value of the offerings reflected a marked drop in advance dollar, stock prices stabilized and even reversed refundings after September 1, the effective date part of the decline recorded earlier in the quar- of new Treasury Department regulations that ter. Stock prices generally moved upward in reduced the attractiveness of these operations. early January, in large part due to the strength- The decline in such issues also may be attribening of the dollar in foreign exchange markets, utable to the increased level of tax-exempt the continued robust growth in economic activ- yields. State and local governments did, howity, and the unexpected gains in profits and ever, raise a larger volume of new capital over dividends reported by several major corpora- the period. As in the third quarter, sales of tions. After a record expansion in the previous securities by various state and local housing quarter, margin credit contracted in the fourth authorities accounted for a sizable portion of the quarter—its first quarterly decline in four years. new issues. Property-casualty insurance com- The decline was attributable in part to liquida- panies and commercial banks continued to be tion of stock holdings to meet margin calls in the major purchasers of tax-exempt offerings. Federal government borrowing and cash balance Quarterly totals, not seasonally adjusted, in billions of dollars IItteemm 1977 1978 Ql Q2 Q3 Q4 Ql Q2 Q3 Q4° Treasury financing Budget surplus, or deficit {-).....,.,....... -18.7 8.6 -12.2 -28.8 -25.8 14.0 -8.1 -23.8 Off-budget deficit1 -4.3 .1 -4.9 -1.3 -3.7 -2.2 -3.1 -.1 Net cash borrowings, or repayments (-) 17.6 -1.1 19.54 20.7 20.8 2.5 15.1 15.2 Other means of financing2 2.7 -.4 .4 2.6 2.8 -3.2 1.0 2.6 Change in cash balance -2.6 7.2 2.84 -6.8 -5.9 11.1 4.9 -6.1 Federally sponsored credit agencies, net cash borrowings3 .7 3.0 1.8 2.0 4.5 6.5 6.1 5.2 1. Includes outlays of the Pension Benefit Guaranty Cor- poration, Federal Home Loan Banks, Federal Land Banks, poration, Postal Service Fund, Rural Electrification and Tele- Federal Intermediate Credit Banks, Banks for Cooperatives, phone Revolving Fund, Rural Telephone Bank, Housing for and Federal National Mortgage Association (including discount the Elderly or Handicapped Fund, and Federal Financing Bank. notes and securities guaranteed by the Government National All data have been adjusted to reflect the return of the Export- Mortgage Association). Import Bank to the unified budget. 4. Includes $2.5 billion of borrowing from the Federal 2. Checks issued less checks paid, accrued items, and other Reserve on September 30, which was repaid October 4 foltransactions. lowing enactment of a new debt ceiling bill. 3. Includes debt of the Federal Home Loan Mortgage Cor- e Estimated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

94 Federal Reserve Bulletin • February 1979 Interest rates on state and local obligations basis, remained quite sizable during the fourth rose appreciably in the fourth quarter. The Bond quarter. In contrast with the borrowing in the Buyer index of tax-exempt bond yields, at 6.58 third quarter, the major proportion of this fipercent in early January, was almost 1/2 of a nancing was long term. As in the preceding percentage point above its level at the end of three quarters, most of the borrowing was re- September. lated to activity of sponsored credit agencies in Treasury borrowing during the fourth quarter the residential mortgage market. The Federal remained at about the third-quarter level of $15 National Mortgage Association and the Federal billion (not seasonally adjusted), despite a rela- Home Loan Bank System both borrowed heavtively large increase in the budget deficit. In ily during most of the quarter to obtain funds contrast with the third quarter, a significant to be channelled to mortgage lenders, and to portion of the deficit was financed in the fourth a lesser extent, to rebuild their holdings of liquid quarter by drawing down Treasury cash bal- assets. ances. The increase in Treasury bill rates over the Issuance of nonmarketable Treasury obliga- fourth quarter was only slightly less than that tions picked up sharply in the fourth quarter in the federal funds rate. The pick-up in Treasdespite the reduction in purchases of such se- ury coupon yields, while generally in line with curities by state and local governments asso- yield increases on private longer-term securities, ciated with the decline in advance refunding remained well below the rise in shorter-term operations. The pick-up reflected a substantial market rates. In consequence, the term structure increase in acquisitions by foreign official ac- of yields on Treasury securities continued to counts with the proceeds from dollar-support exhibit the steeply humped pattern that had operations in foreign exchange markets. The emerged at the end of the third quarter, with Treasury also issued $1.6 billion of obligations the peak still centering on the 12-month maturity denominated in German marks, sold mainly to area. For maturities beyond five years, the curve German financial institutions, as part of the remained essentially flat. The hump in the yield effort to stem the decline in the foreign exchange curve may have indicated market expectations value of the dollar. of a turning point in late 1979 in the business In the open market, the Treasury continued and the interest rate cycles. to rely on coupon securities to meet its financing needs in the fourth quarter. During the four MORTGAGE AND CONSUMER CREDIT quarters of 1978, the outstanding supply of Treasury bills remained about unchanged, on Net mortgage lending moved higher during the balance, at $161 billion, while coupon issues quarter, exceeding even its previous peak in the increased almost $27 billion. However, most of fourth quarter of 1977. The flow of funds into the coupon issues had maturities of two to four residential mortgages picked up moderately, to years; as a result, the average maturity of pri- its most rapid rate of the year. Commercial and vately held marketable Treasury debt, which other nonresidential mortgage lending continued had been three years and four months at the at the relatively high pace of the third quarter, end of 1978, lengthened only five months during reflecting principally the sustained strength in the year. In the fourth quarter, foreign official commercial construction activity. accounts also acquired a sharply increased vol- Commercial banks maintained their mortgage ume of marketable Treasury issues; net pur- lending in the fourth quarter at about the rapid chases of these issues by all other investors were pace recorded in the previous two quarters, and relatively small. life insurance companies acquired substantial Net borrowing by federally sponsored credit amounts of mortgages, as they had earlier in agencies, though less than the strong pace of the year. The sustained strength in mortgage the third quarter on a seasonally unadjusted acquisitions by these diversified financial inter- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q4 1978 95 Net change in mortgage debt outstanding increased the rate at which they were taking Seasonally adjusted annual rates, in billions of dollars down advances from Federal Home Loan Banks in the fourth quarter. In addition, at insured 1977 1978 savings and loans, the average liquidity ratio— CChhaannggee Q4 Ql Q2 Q3 1 Q4e cash and liquid assets divided by the sum of short-term borrowings and deposits—declined Total 152 135 142 141 144 during the quarter for the first time since the By type of property introduction of the variable-ceiling certificates. Residential 117 100 105 103 106 Other1 35 35 37 38 38 However, the ratio remained significantly above the minimum liquidity requirement. The weak- By type of holder Commercial banks 32 27 36 37 36 ening in deposit growth also encouraged a lev- Savings and loans 62 54 52 48 52 Mutual savings banks 8 7 6 7 7 eling-off in mortgage commitments outstanding Life insurance companies 9 6 9 10 9 FNMA and GNMA • ; * 6 13 8 6 at these associations toward the year-end fol- Other2 41 35 26 31 34 lowing a pick-up early in the quarter. Issuance of mortgage pass-through securities 1. Includes commercial and other nonresidential as well as farm properties. guaranteed by the Government National Mort- 2. Includes mortgage pools backing securities guaranteed gage Association (GNMA) increased further in by the Government National Mortgage Association, Federal Home Loan Mortgage Corporation, or Farmers Home Admin- the fourth quarter, while purchases by the Fedistration, some of which may have been purchased by the eral National Mortgage Association (FNMA) of institutions shown separately. r Revised. government-underwritten home loans continued e Estimated. to decline somewhat. This pattern reflected in * Less than $500 million. part the sustained positive spread between prices of GNMA-guaranteed, pass-through securities mediaries can be attributed in part to the con- and prices available to originators of governtinued robust demand for commercial and other nonresidential mortgages, for which they are Deposits at savings and loans major lenders, as well as to the relative attrac- Annual rate of change, perce tiveness of mortgage yields. In addition, the reduced volume of private offerings of corporate 16 bonds permitted insurance companies to channel increases in cash flows into mortgage markets. The bulk of the rise in mortgage lending in 8 the fourth quarter occurred at savings and loan associations, in lagged response to the significant pick-up in deposit flows following the in- 0 troduction of the money market certificate on Q4 Ql Q2 Q3 1977 1978 June 1. Despite increased net sales of six-month money market certificates during the fourth Seasonally adjusted. Quarterly averages at annual rates. quarter, deposit growth at savings and loan associations (measured on an end-of-period ment-guaranteed mortgages under outstanding basis) slowed somewhat from the third-quarter FNMA mortgage purchase commitments. Compace, though it remained strong relative to de- bined, the volume of GNMA-guaranteed, passposit flows in the first half of the year. Even through security issues plus FNMA purchases though deposit flows moderated during the of government-underwritten home loans inquarter, savings and loans increased their mort- creased significantly in the fourth quarter, to its gage lending by relying more heavily on bor- highest level of the year. rowed funds and by reducing their liquidity. On The average interest rate on new commita seasonally adjusted basis, these associations ments at savings and loan associations for con- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

96 Federal Reserve Bulletin • February 1979 ventional home mortgages with 80 percent strong expansion in the third quarter, but someloan-value ratios increased more than 1/2 of a what slower than that of the first half. The percentage point in the fourth quarter, about in moderate increase in credit extensions during line with increases in other long-term interest the fourth quarter was about offset by a pick-up rates. The rise in mortgage rates may be attrib- in debt liquidations. Sales of autos at higher utable in part to renewed supply pressures re- prices remained a significant factor in the growth sulting from the slackening in deposit flows at of installment credit. Interest rates on automothrift institutions in the face of continued robust bile credit increased slightly over the quarter, demand for mortgage credit. and other credit terms, such as the average loan Consumer installment credit outstanding ex- maturity at commercial banks and the downpanded at an annual rate of just over 18 percent payment requirements at finance companies, during the fourth quarter, slightly more than the also continued to tighten. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

97 Check Processing at Federal Reserve Offices James M. Brundy, David B. Humphrey, and lower-cost, and rapidly growing substitute for Myron L. Kwast of the Financial Studies Sec- check-clearing techniques. tion, Division of Research and Statistics, Among other purposes, the Federal Reserve prepared this article. check-clearing facilities were initially established to eliminate the practice of "nonpar In fulfilling its responsibilities for ensuring an banking," under which a percentage of the face efficient and effective payments mechanism for value was deducted when a check was paid. the nation, the Federal Reserve System operates Many banks sought to avoid these remittance a number of payments-mechanism facilities. charges and other fees; the result was that These facilities include 48 check-processing checks were collected through circuitous routes, centers that serve as regional and national making the national check-collection system clearinghouses for checks deposited at the Fed- slow and cumbersome. Nonpar banking was eral Reserve by commerc al banks. Federal Re- therefore thought to impede commerce and ecoserve Banks have acted as check clearinghouses nomic growth. Checks cleared by the Federal since shortly after the enactment of the Federal Reserve System must be paid at face value, and Reserve Act in 1913. Today these Federal Re- this requirement has contributed to the virtual serve facilities provide the infrastructure for the disappearance of nonpar banking.1 national check-clearing system, ensuring the Checks to be cleared through the Federal availability of a basic level of check-payments Reserve initially reach a Federal Reserve office services nationwide. During 1977 the Federal from a commercial bank in one of two ways.2 Reserve Banks processed more than 13 billion First, member, and in some cases nonmember, commercial check items with a total dollar value banks may deposit items directly with a Federal in excess of $6.4 trillion. Reserve office.3 Second, member and non- The clearing of paper checks represents only member banks may first send their checks to one of the payments-mechanism services pro- their correspondent banks, which, after some vided by the Federal Reserve. Two others are preliminary processing, deposit them with the a secure wire transfer service for the movement of funds between member banks, and the clear- 1 A more detailed overview of this issue is given ing of check-like deposit items electronically on in "Federal Reserve Operations in Payment Mechabehalf of automated clearinghouse (ACH) asso- nisms: A Summary," FEDERAL RESERVE BULLETIN, vol. 62 (June 1976), pp. 481-89. The legal basis for ciations. More than 24 million wire transfers Federal Reserve participation in check clearing is also of funds, primarily bank-to-bank transactions, presented. with a dollar value in excess of $48 trillion, 2 For simplicity, direct U.S. government deposits are ignored, and indirect deposits, which pass through one were processed by the Federal Reserve System or more correspondent banks, are shown here passing in 1977. ACH clearings totaled around $40 through only one bank. billion, represented by 106 million items. Al- 3 Nonmember banks are permitted to deposit directly though checks are now the predominant method only items eligible for processing by regional checkprocessing centers (RCPCs); other check-processing of funds transfer used by the general public, services are provided indirectly to nonmember banks ACH clearings are an innovative, potentially (and other financial institutions) through member correspondent banks. The RCPC program, begun in the early NOTE. Carol K. Keyt performed the data manipu- 1970s, was aimed at increasing the proportion of checks lations for this article. cleared on an overnight basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

98 Federal Reserve Bulletin • February 1979 Check-clearing mechanism Federal Reserve.4 Thus, the Federal Reserve the check at the local Federal Reserve Bank, acts as a correspondent bank for commercial which will clear the item by crediting the reserve banks. account of bank B (or its agent), presenting the The check-clearing mechanism is illustrated check for payment to bank A, and debiting that schematically in the diagram above. If party B reserve account. These procedures concern loreceives a check from party A, drawn on a local cally deposited and locally cleared checks; these bank in the Dallas Federal Reserve Bank service checks do not move between Reserve Banks. area (zone), and deposits that check in the same A similar sequence occurs when party C, local bank A.upon which it is drawn, the check whose bank is in New York, writes a check will not enter clearing channels of either corre- to party B. Party B deposits the check in Dallas spondent banks or the Federal Reserve. This bank B and again sets in motion one of two transaction is represented by the dotted lines in clearing arrangements: (1) bank B can send the the left half of the diagram. From the bank's check directly to the New York Federal Reserve point of view, the deposited check is drawn on Bank for collection (presentment) at bank C itself, or "on us," and no other bank need be (creating an interzone "direct send" item, reinvolved. However, if parties A and B maintain presented by a solid line in the right half of accounts at two different Dallas banks, the item the diagram); or (2) bank B can redeposit the can be cleared in two ways. In the first, repre- check (now shown by a dotted line) with the sented by solid lines in the diagram, bank B, Dallas Federal Reserve Bank which, in turn, which receives the deposited check drawn on sends it to the New York Federal Reserve Bank bank A, participates in a local clearing arrange- for presentment at bank C (creating an interzone ment in which banks A and B exchange checks deposit between Federal Reserve Banks).5 drawn upon one another, posting them to accounts they hold with one another. In the sec- In May 1978 the Federal Reserve conducted ond, shown by dashed lines, bank B redeposits a comprehensive survey of the volume of items 5 Another method, bank B sending the check directly 4 Because the Federal Reserve requires some to bank C in New York, is rarely used. Only for checks preparatory work before accepting items for deposit, written for exceptionally large amounts could the extra many smaller banks (both members and nonmembers) expense of this clearing method be offset by the interest choose to obtain access to check-collection services earned during the few hours saved by this more rapid through correspondent banks. clearing procedure. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Check Processing at Federal Reserve Offices 99 and the amount of funds cleared through its at individual Reserve Banks and Branches and check-processing function.6 Each of the 48 regional check-processing centers (RCPCs) Federal Reserve check-processing offices re- have been aggregated to give national (system) ported the total number and dollar value of totals and totals for each Federal Reserve Dischecks deposited by type of item and class of trict. depositor. During May 1978, the system cleared a daily average of more than 51 million items, LOCAL AND INTERZONE DEPOSITS with a dollar value of nearly $22 billion. The results of the May 1978 survey are presented Of the overall total, nearly two-thirds of the in tables 1 through 7. In the tables, deposits items deposited were local deposits (from banks and government agencies within a Federal Reserve office service area); the balance were 6 May was selected as the survey month because previous studies had indicated that check data for April interzone or interoffice deposits (from instituand May seem to be relatively free of seasonal distor- tions outside the service area). As shown in tions. See R. William Powers, "A Survey of Bank table 1, column 3, for each of the 12 Federal Check Volumes," Journal of Bank Research, vol. 6 (Winter 1976), pp. 245-56. Reserve Districts, local deposits accounted for 1. Number of items deposited at Federal Reserve Banks Daily average, May 1978 Average annual Federal Reserve District Number of items Percent of total growth in number, 1973-77 Local Interzone Local Interzone (percent) (1) (2) (3) (4) (5) Boston 2,830,287 1,334,394 68.0 32.0 8.4 New York ... 3,137,136 2,661,396 54.1 45.9 8.0 Philadelphia .. 1,724,773 808,632 68.1 39.9 3.1 Cleveland 1,927,710 1,477,808 56.6 43.4 5.4 Richmond 2,571,922 1,882,581 57.7 42.3 7.5 Atlanta 4,779,040 1,334,578 78.2 21.8 9.1 Chicago 5,470,145 2,817,603 66.0 34.0 8.4 St. Louis 1,712,159 1,097,163 61.0 39.0 4.4 Minneapolis .. 1,752,448 751,430 70.0 30.0 5.6 Kansas City .. 3,184,980 1.448.909 68.7 31.3 6.3 Dallas 1,751,441 1,494,405 54.0 46.0 6.7 San Francisco 1,742,520 1.725.910 50.2 49.8 9.1 System 32,617,742 18,834,809 63.4 36.6 7.3 2. Dollar value of items deposited at Federal Reserve Banks Daily average, May 1978 Local deposits Interzone deposits Percent of total FFeeddeerraall RReesseerrvvee DDiissttrriicctt (th T ou o s ta a l n ds Average (th T ou o s ta a l n ds Average Local Interzone of dollars) (dollars) of dollars) (dollars) (1) (2) (3) (4) (5) (6) Boston 759,362 268 713,833 535 51.6 48.4 New York 1,527,717 487 1,959,583 736 43.8 56.2 Philadelphia 531,197 308 420,018 519 55.8 44.2 Cleveland 572,558 297 976,199 661 37.0 63.0 Richmond 724,345 282 1,190,893 633 37.8 62.2 Atlanta 1,567,345 328 928,988 696 62.8 37.2 Chicago 1,537,001 281 2,262,395 803 40.5 59.5 St. Louis 423,804 248 580,852 529 42.2 57.8 Minneapolis 405,532 231 428,966 571 48.6 51.4 Kansas City 822,141 258 801,406 553 50.6 49.4 Dallas 549,715 314 591,838 396 48.2 51.8 San Francisco 613,915 352 1,071,519 621 36.4 63.6 System 10,073,983 309 11,926,490 633 45.8 54.2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

100 Federal Reserve Bulletin • February 1979 50 percent or more (up to 78 percent) of all Districts (table 2, column 5): the average value items deposited at Federal Reserve offices. Fed- of a locally deposited check, $309, is substaneral Reserve offices in the Atlanta and San tially less than the average value of checks Francisco Districts experienced the highest deposited interzone, $633 (columns 2 and 4). growth in check volume from 1973 to 1977 (9 The New York and Chicago Districts have the percent), while the Philadelphia District had the largest average dollar value for an interzone lowest (3 percent). Over all, system check vol- deposit item. ume grew at a 7 percent average annual rate for the period (column 5). CLASSES OF DEPOSITORS Although more than 63 percent of the items AND DEPOSIT ITEMS deposited at Federal Reserve offices were local items (table 1, column 3), the dollar value of About 28 percent of all deposits are direct these items totaled less than 50 percent of the sends—that is, received from member banks in value of all deposits for eight Federal Reserve another Federal Reserve District (table 3, col- 3. Percentage distribution of number of items deposited at Federal Reserve Banks, by type of depositor1 Daily average, May 1978 Local deposits Interzone deposits Federal Reserve District Federal TToottaall Member Nonmember Reserve Directbanks banks Government offices sending banks (1) (2) (3) (4) (5) (6) Boston 50.6 17.2 0 7.3 24.7 100.0 New York 52.3 1.6 0 9.0 36.9 100.0 Philadelphia 63.2 2.6 2.3 6.0 25.5 100.0 Cleveland 52.7 2.8 0 10.2 34.1 100.0 Richmond 41.3 16.1 0 7.1 34.3 100.0 Atlanta 58.6 18.2 0 6.5 15.2 100.0 Chicago 58.7 6.9 0 8.0 26.0 100.0 St. Louis 56.7 3.3 .9 9.6 29.4 100.0 Minneapolis 54.6 14.8 0 8.9 20.9 100.0 Kansas City 68.1 .3 .3 7.6 23.5 100.0 Dallas 48.7 3.8 0 8.9 , 36.7 100.0 San Francisco 34.7 13.9 1.0 10.6 38.9 100.0 System 53.9 8.6 .3 8.1 28.3 100.0 Details may not total 100.0 because of rounding and reporting errors by some banks. 4. Percentage distribution of number of items deposited at Federal Reserve Banks, by type of deposit1 Daily average, May 1978 Local deposits Interzone deposits FFeeddeerraall RReesseerrvvee DDiissttrriicctt Going TToottaall RCPC City Country interzone Unsorted RCPC City Country (1) (2) (3) (4) (5) (6) (7) (8) (9) Boston 57.5 5.0 1.2 2.8 1.3 23.4 5.4 3.3 100.0 New York 36.6 11.1 2.3 4.1 .1 12.7 31.6 1.5 100.0 Philadelphia 50.9 3.7 1.9 5.9 5.7 .1 12.5 19.3 100.0 Cleveland 34.1 2.9 0.0 11.1 8.4 27.7 15.7 0 100.0 Richmond 46.7 3.8 1.0 6.1 .2 36.9 4.4 .9 100.0 Atlanta 62.1 4.4 0 11.7 0 16.0 5.8 0 100.0 Chicago 46.0 8.3 5.2 6.4 .1 16.6 13.5 3.9 100.0 St. Louis 28.7 16.6 10.2 4.4 1.1 15.1 15.7 8.2 100.0 MMiinnnneeaappoolliiss 16.8 24.1 17.3 8.7 3.1 12.4 8.3 9.3 100.0 KKaannssaass CCiittyy 20.4 15.9 22.5 9.6 .2 5.9 13.6 11.7 100.0 Dallas 37.5 7.3 8.1 1.0 0 15.9 20.9 9.3 100.0 San Francisco 44.1 1.2 0 3.6 1.4 43.5 6.3 0 100.0 System 41.9 8.3 5.3 6.5 1.4 18.8 13.1 4.7 100.0 1 Details may not total 100.0 because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Check Processing at Federal Reserve Offices 101 umn 5). Federal Reserve offices also send items institutions in the same locality as, respectively, to other Federal Reserve offices, but these inter- the RCPCs and Federal Reserve offices; delivery zone deposits account for only about 8 percent is typically made by courier (under contract with of total deposits and less than one-third of all the Federal Reserve). Due to their proximity to interzone deposits. a Federal Reserve office, depositors of these Member banks account for 86 percent of all items have overnight availability of funds if they local deposits and 78 percent of all interzone meet cut-off times for deposits. Depositors of deposits, for an average of 82 percent of total "country" items may have to wait one day or deposits made at Federal Reserve offices. Direct more before the Federal Reserve will credit their U.S. government deposits of checks at Federal accounts and thus make funds available. Reserve banks are very small. Nonmember bank Country items are drawn on institutions remote deposits, although restricted to RCPCs, account from a Federal Reserve office, and delivery may for 9 percent of total deposits. be made through the U.S. Postal Service. The distance of the institution upon which the Locally deposited items going to another deposited items are drawn from an RCPC or Federal Reserve office—items going intera district central city determines when the zone—also have funds availability deferred one depositing bank will have use of the funds day or more, depending upon whether they are deposited at a Federal Reserve office. Table 4 drawn on city, RCPC, or country financial inshows the proportion of items deposited falling stitutions. Interzone items are often transported into various categories of "funds availability." between Federal Reserve offices by contract air The funds-availability schedule established by carrier. Unsorted deposit items, the smallest the Federal Reserve for its check-clearing category in table 4, have undergone the least operations is closely related to the time it nor- predeposit processing. Currently, depositing inmally takes to process, transport, and present stitutions may not deposit more than 5,000 checks for payment at drawee financial institu- unsorted items each day at a Federal Reserve tions. "Regional check-processing center" and office. "city" deposit items are drafts on financial Of the various deposit categories in table 4, 5. Percentage distribution of number of items deposited at Federal Reserve Banks, by size of bank1 Daily average, May 1978 Size of bank (de posits in millions of dollars) NNoonnbbaannkk FFeeddeerraall RReesseerrvvee More ddeeppoossiittoorrss22 TToottaall DDiissttrriicctt 50- 100- 500- than 0-10 10-50 100 500 1,000 1,000 Boston .6 8.7 9.4 27.3 8.0 38.4 7.6 100.0 New York .1 3.4 3.8 17.8 23.7 41.8 9.4 100.0 Philadelphia .2 2.9 3.2 10.4 18.8 55.9 8.6 100.0 Cleveland .2 7.7 6.8 16.9 19.3 38.9 10.2 100.0 Richmond .4 11.2 4.7 21.0 16.5 38.0 8.2 100.0 Atlanta 1.6 15.9 11.0 29.0 14.6 19.9 8.0 100.0 Chicago .6 9.2 9.4 27.7 9.0 35.8 8.3 100.0 St. Louis .6 7.8 5.7 15.4 21.0 38.1 11.4 100.0 Minneapolis 3.5 24.4 11.2 21.5 3.6 25.9 9.9 100.0 Kansas City .2 6.0 6.5 31.6 33.1 14.4 8.2 100.0 Dallas .4 5.2 5.4 18.3 13.2 46.6 10.9 100.0 San Francisco 1.0 9.9 3.2 13.8 12.0 47.5 12.6 100.0 System .7 9.2 7.0 22.4 16.1 35.8 8.8 100.0 Memo Demand deposits held by commercial banks at other commercial banks as a percent of total "due to" deposits (member banks only, March 31, 1978) .1 .6 1.1 1100..44 88..00 79.9 0 100.0 Details may not total 100.0 because of rounding. Includes deposits by Federal Reserve offices, government, and unidentified depositors. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

102 Federal Reserve Bulletin • February 1979 RCPC items form the largest, accounting for INTERDISTRICT CHECK FLOWS 61 percent of all items deposited (both locally Federal Reserve District offices participate in and interzone). The number of city items acinterdistrict check-clearing operations in procounts for 21 percent of total check volume. portions that vary widely among the sending and receiving districts. At the lowest end of the SIZE CLASS OF BANK DEPOSITORS scale, only 4.5 percent of the number of items (and 2.2 percent of the value of those items) Not surprisingly, the largest banks (including sent from the San Francisco Federal Reserve the largest correspondent banks, measured by District to the New York Federal Reserve ofshare of "due to" deposits shown in the last fices were sent by Federal Reserve offices in the line of table 5) account for the largest number San Francisco District (table 6, row 2, column of items deposited for the system as a whole. 12). Thus, 95.5 percent of the items came from Among the districts, the only exceptions to this direct-sending banks.7 At the other end of the pattern occur in the Atlanta and Kansas City scale, 69.2 percent of the number of items Districts, where intermediate-sized banks (those (representing 32.9 percent of the dollar value) holding from $100 million to $1 billion in sent from the Minneapolis District to the Atlanta deposit liabilities) deposit the largest share of Federal Reserve offices were sent by Federal items. Nonbank depositors, including other Reserve offices (row 6, column 9). In general, Federal Reserve offices and government depositors, account for less than 9 percent of total 7 The system reimburses banks for their direct-send deposits for the system. These and other details transport costs up to the equivalent cost of first-class on deposits by size of bank appear in table 5. mail. 6. Percentage distribution of number and dollar value of interdistrict deposits at Federal Reserve offices sent by Federal Reserve offices1 Daily average, May 1978 Sendinjg Federal Reserve District RReecceeiivviinngg San Federal Reserve New Phila- Cleve- Rich- St. Minne- Kansas Franuistrict Boston York delphia land mond Atlanta Chicago Louis apolis City Dallas cisco (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) 1. Boston 18.1 13.6 33.3 29.6 44.0 19.0 17.0 48.7 42.5 8.5 10.5 (6.4) (5.0) (10.9) (22.3) (35.4) (5.2) (17.2) (32.0) (31.5) (3.5) (4.6) 2. New York 8.7 9.1 31.5 15.9 46.1 18.5 16.1 45.7 44.2 5.2 4.5 (3.6) (5.3) (10.1) (9.0) (25.3) (4.9) (9.0) (19.0) (25.3) (1.3) (2.2) 3. PPhhiillaaddeellpphhiiaa 16.9 10.7 19.6 19.5 47.3 19.9 14.8 46.7 40.5 8.5 10.8 (5.1) (3.3) (6.5) (12.7) (40.3) (6.0) (12.1) (20.9) (24.3) (2.2) (3.7) 4. Cleveland 13.4 17.5 14.2 29.5 49.8 18.0 6.9 51.2 39.7 7.7 12.4 (4.7) (2.7) (12.2) (30.8) (33.0) (4.6) (6.2) (38.7) (24.1) (2.7) (4.9) 5. Richmond 20.9 16.5 12.4 28.3 34.0' 21.5 34.7 50.4 36.4 8.3 10.8 (7.3) (3.8) (10.6) (11.3) (14.9) (5.9) (30.9) (22.7) (19.5) (2.2) (5.0) 6. Atlanta 23.1 18.0 22.9 55.9 21.3 26.6 18.1 69.2 38.8 5.5 15.5 (10.6) (2.5) (7.4) (9.5) (17.1) (5.3) (12.9) (32.9) (22.1) (1.6) (8.4) 7. CChhiiccaaggoo 14.2 14.5 11.5 26.9 35.8 52.2 13.1 32.4 26.6 9.2 10.4 (4.7) (.9) (4.0) (11.4) (16.6) (33.1) (11.3) (23.0) (13.8) (2.4) (4.6) 8. St. Louis 19.3 15.5 14.0 32.6 42.0 37.4 21.6 67.9 29.8 5.7 13.7 (6.5) (2.7) (8.3) (14.4) (32.3) (23.4) (4.8) (41.1) (15.2) (2.6) (3.7) 9. MMiinnnneeaappoolliiss 14.7 29.5 12.2 47.5 32.0 64.4 19.0 30.7 41.4 16.1 19.5 (•5) (9.2) (18.5) (24.7) (39.2) (59.6) (6.5) (21.2) (26.9) (13.2) (33.3) 10. KKaannssaass CCiittyy 27.4 14.9 11.9 47.8 46.7 62.3 17.7 24.5 64.1 4.8 15.8 (13.5) (3.5) (8.8) (13.2) (36.1) (44.2) (3.9) (13.0) (34.8) (1.6) (14.5) 11. Dallas 20.0 14.9 13.2 46.5 36.6 52.5 20.5 21.4 67.8 33.1 11.1 (7.9) (3.6) (8.6) (10.0) (32.2) (38.1) (5.3) (11-5) (44.9) (15.2) (5.1) 12. San Francisco 23.2 8.8 19.5 41.7 24.9 33.4 11.5 31.7 30.9 25.1 18.6 (18.3) (3.3) (6.7) (16.1) (17.3) (19.5) (6.6) (29.5) (18.0) (29.4) (13.2) 1 The percentages for dollar value appear in parentheses. column 5). Thus, the balance, 70.4 percent of the items (and This table tells, for example, that 29.6 percent of the number 77.7 percent of the dollar value), were from direct-sending of items (and 22.3 percent of the dollar value) sent from the banks. Richmond District and received in the Boston District were These data do not cover clearings outside the Federal Resent by Richmond District Federal Reserve offices (row 1, serve System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Check Processing at Federal Reserve Offices 103 the Federal Reserve offices in the Dallas and 7. Percentage distribution of number of items San Francisco Districts participate least in presented for payment by Federal Reserve Banks, by type of presentee institution1 sending checks from those districts to Federal Reserve offices in other districts, accounting on Daily average, May 1978 the average for 9 percent and 12 percent, re- Federal Reserve Member m N em on b - er Others2 Total spectively, of the items sent from their districts. District banks banks The most active Federal Reserve offices, in Boston 46.2 33.9 19.9 100.0 general, are in the Atlanta and Minneapolis New York 80.0 8.6 11.4 100.0 Philadelphia 58.7 34.9 6.4 100.0 districts; they account for an average of 47 Cleveland 76.4 23.4 .3 100.0 Richmond 71.0 26.6 2.5 100.0 percent and 52 percent, respectively, of all the Atlanta 43.4 48.3 8.3 100.0 items sent from those districts.8 Chicago 53.8 42.7 3.4 100.0 In all but four cases the Federal Reserve St. Louis 37.3 53.6 9.1 100.0 Minneapolis 57.0 40.7 2.3 100.0 percentage of the number of items sent is larger Kansas City 53.6 44.4 2.0 100.0 Dallas 60.9 33.6 5.5 100.0 than its percentage of the dollar value of inter- San Fransisco 54.6 38.0 7.4 100.0 district deposits. Thus, the average dollar value System 57.9 35.0 7.2 100.0 of interdistrict checks from Federal Reserve 1 Details may not total 100.0 because of rounding. offices is smaller than the average dollar value 2 Includes items to thrift institutions and unclassified items. of interdistrict checks from direct-sending banks. Banks send relatively large checks di- reflects the proportion of demand deposits plus rectly because they can more than compensate other 4 "checking" deposits at these institutions for the greater check-processing costs of direct in each district. The impact of NOW accounts sending through more rapid availability of funds in New England (Boston District) and 4'checkthan the Federal Reserve provides. In 121 of ing accounts" at mutual savings banks in New the 132 interdistrict sending combinations in York State (New York District) is evident in table 6, the share of items sent by direct-sending table 7, which shows that those two districts banks exceeds 50 percent of the total interdis- have the largest proportions of nonbank presentrict deposits at Federal Reserve offices. tee institutions. PRESENTMENTS BY SUMMARY FEDERAL RESERVE OFFICES This article has presented some results of the Checks have to be physically presented to Federal Reserve's May 1978 survey of its drawee financial institutions before payment is check-clearing function. While, by number, made and funds are transferred. For the system most checks cleared by the Federal Reserve are as a whole, 58 percent of all items presented locally deposited items, the dollar value of infor payment by Federal Reserve offices are pre- terzone checks is the greater by far. Thui, the sented to member banks, while 35 percent are average value of an interzone check is more than presented to nonmember banks. These and other twice that of an item deposited and cleared results of the survey concerning presentments locally. Member banks account for 82 percent by Federal Reserve offices are listed in table 7. of all checks deposited at the Federal Reserve. Included under 4'Others" are items involving Also, funds from 82 percent of the items deposnonbank institutions: drafts on negotiable order ited are normally available the next day. Banks of withdrawal (NOW) accounts in thrift institu- with total deposits of more than $1 billion tions in New England and checks drawn on deposit around 36 percent of all the checks mutual savings banks in New York State. The submitted to the Federal Reserve, a proportion distribution of items presented to member and consistent with their position as major correnonmember banks by Federal Reserve Districts spondent banks. Finally, interdistrict check flows suggest that the Federal Reserve is only 8 These data show interdistrict deposits at Federal one of many participants in the interdistrict Reserve offices only. No clearing outside the Federal Reserve System is included. processing of checks. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

104 Survey of Time and Savings Deposits at Commercial Banks, October 1978 David M. Lefever of the Board's Division of had averaged $11 billion for the five preceding Research and Statistics prepared this article. survey quarters. The growth of total small-denomination (less Total time and savings deposits at insured com- than $100,000) time and savings deposits remercial banks, not adjusted for seasonal varia- flected continued rapid inflows of the six-month tion, expanded more than 2Vi percent during the money market certificates (MMCs). The ceiling period from July 27 to October 25, 1978, up rate on MMCs varies weekly with changes in slightly from the 2 percent increase over the the average auction yield on new issues of preceding survey quarter.1 Despite further in- six-month Treasury bills. Although a substantial creases in market interest rates above regulatory portion of these funds appears to have been ceilings, inflows of interest-bearing deposits shifted from other types of bank deposits, the subject to rate ceilings totaled more than $3^2 MMCs also attracted funds that otherwise would billion during the July-October period, near the have been invested in market instruments. Savaverage of $4 billion per quarter since April ings and small-denomination time deposits ex- 1977. To help finance expansion in their loans, cluding MMCs fell $5 billion, substantially banks also raised $12 billion through the is- more than the decrease of $l1/2 billion during suance of large-denomination ($100,000 or the previous survey quarter. more) time deposits in the latest survey period. Net sales of large-denomination time deposits, SAVINGS DEPOSITS which are not subject to interest rate ceilings, During the July-October period, savings deposits at commercial banks, not seasonally ad- 1 Surveys of time and savings deposits (STSD) at justed, declined for the second straight survey all member banks were conducted by the Board of quarter—the first declines since the survey of Governors in late 1965, in early 1966, and quarterly in 1967. In January and July 1967 the surveys also January 1970. The net outflow of savings deincluded data for all insured nonmember banks collected posits during the latest survey period, amountby the Federal Deposit Insurance Corporation (FDIC). ing to $400 million, was, however, substantially Since the beginning of 1968 the Board of Governors and the FDIC have conducted the joint quarterly surveys less than the net decline of $l!/2 billion in the to provide estimates for all insured commercial banks previous period. The net outflow of savings based on a probability sample of banks. The results of deposits during the last two survey quarters all earlier surveys have appeared in previous issues of the FEDERAL RESERVE BULLETIN from 1966 to 1978, reflected rising rates on alternative short-term most recently November 1978. instruments: Treasury securities, shares of The current sample—designed to provide estimates money market mutual funds, and MMCs. By of the composition of deposits—includes about 560 insured commercial banks. For details of the statistical the end of October, the maximum allowable methodology, see "Survey of Time and Savings De- yield on savings deposits was more than 2Vi posits, July 1976," in BULLETIN, vol. 63 (December percentage points below rates on 90-day Treas- 1976), pp. 986-1000. Detailed data for the current survey (formerly con- ury bills and money market mutual funds, and tained in appendix tables) are available on request from more than 3 3A percentage points below the ef- Publications Services, Division of Support Services, fective yield on MMCs. Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Outflows of savings deposits were concen- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Survey of Time and Savings Deposits 105 trated in accounts held by individuals and do- SMALL-DENOMINA TION mestic governmental units; deposits in these TIME DEPOSITS categories declined $850 million and $150 million, respectively. Meanwhile, businesses in- The outstanding level of interest-earning, creased their holdings of savings deposits more small-denomination time deposits—consisting than $550 million, after a modest decline during of all maturity categories, including MMCs, the previous survey quarter and virtually no net individual retirement accounts (IRAs), and inflow over the preceding year. For each of the Keogh accounts—rose $4 billion (not seasonally three major categories of savings deposits, a adjusted) during the July-October period to slightly larger proportion of banks paid the nearly $180 billion, following an increase of $3 ceiling rate of interest in the October survey than billion in the previous quarter. During the surin July. Nevertheless, the impact of these in- vey period, the outstanding level of MMCs creases was so small that the average rate paid jumped $8% billion, compared with $5!/2 billion on all new issues of savings deposits, weighted during the first two months following their inby the amount of deposits outstanding, remained troduction on June 1. Nearly all other categories unchanged from the July survey at 4.93 percent. of small time deposits maturing in less than six 1. Types of time and savings deposits held by insured commercial banks on survey dates, April 26, July 26, and October 25, 1978 Deposits NNuummbbeerr ooff iissssuuiinngg bbaannkkss TTTyyypppeee ooofff dddeeepppooosssiiittt,,, dddeeennnooommmiiinnnaaatttiiiooonnn,,, Millions of dollars Percentage change aaannnddd ooorrriiigggiiinnnaaalll mmmaaatttuuurrriiitttyyy Apr. 26 July 26 Oct. 25 Apr. 26 July 26 Oct. 25 Apr. 26- July 26- July 26 Oct. 25 Total time and savings deposits 14,339 14,338 14,299 564,410 576,366 591,754 2.1 2.7 Savings 1144,,333399 1144,,333388 14,299 222,065 222200,,558833 222200,,008800 -.7 -.2 Issued to: Individuals and nonprofit organizations 14,339 14,338 14,299 205,843 204,847 203,980 -.5 -.4 Partnerships and corporations operated for profit (other than commercial banks) 9,754 9,989 9,860 10,679 1100,,664466 11,198 -.3 5.2 Domestic governmental units 8,363 8,023 8,287 5,427 4,954 4,788 -8.7 -3.4 All other 1,081 1,268 1,237 116 137 114 17.8 -16.9 IRA and Keogh Plan time deposits, 3 years or more 9,434 9,364 9,329 2,549 2,770 2,992 8.7 8.0 Money market certificates, $10,000 or more, exactly 6 months1 99,,110022 1100,,442277 55,,338811 1133,,883388 115577..22 Other interest-bearing time deposits, less than $100,000 1144,,110022 14,095 14,008 169,674 167,185 162,586 -1.5 -2.8 Issued to: Domestic governmental units 11,135 10,873 10,643 4,219 4,006 3,694 -5.0 -7.8 30 up to 90 days 5,153 4,770 4,904 865 918 980 6.2 6.7 90 up to 180 days 8,657 7,961 7,541 1,273 1,166 1,084 -8.5 -7.0 180 days up to 1 year 5,132 5,539 5,439 825 666 614 -19.3 -7.8 1 year and over 8,748 8,867 8,173 1,255 1,256 1,015 0.0 -19.2 Other than domestic governmental units 14,102 14,092 14,008 165,455 163,178 158,893 -1.4 -2.6 30 up to 90 days 6,439 6,125 5,514 5,886 5,413 4,369 -8.0 -19.3 90 up to 180 days 11,635 11,700 11,439 30,634 29,392 28,732 -4.1 -2.2 180 days up to 1 year 8,605 8,458 8,176 3,105 3,156 3,239 1.6 2.7 1 up to 2i/i years 13,832 13,769 13,751 33,941 32,857 30,820 -3.2 -6.2 2l/z up to 4 years2 12,750 12,902 12,822 19,154 18,346 17,384 -4.2 -5.2 4 up to 6 years2 12,610 13,044 12,920 52,081 50,850 49,339 -2.4 -3.0 6 up to 8 years2 9,455 10,765 10,965 20,654 21,738 22,721 5.2 4.5 8 years and over * 2 6,186 7,789 1,427 2,288 60.3 Interest-bearing tijne deposits, $100,000 or more. 11,369 11,531 11,789 164,616 174,048 185,907 5.7 6.8 Non-interest-bearing time deposits 1,650 1,447 1,734 3,999 A,212 4,223 6.8 -1.2 Less than $100,000 1,379 1,177 1,416 623 694 711 11.4 2.5 $100,000 or more 667 658 687 3,376 3,578 3,511 6.0 -1.9 Club accounts (Christmas savings, vacation, or similar club accounts) 9,246 9,550 9,225 1,508 2,128 2,128 41.1 .0 1 Issuance authorized beginning June 1, 1978. offered certain types of deposits as of the survey date are not counted 2 Excludes all IRA and Keogh Plan accounts with original maturity as issuing banks. However, small amounts of deposits held at banks of 3 years or more. that had discontinued issuing certain types of deposits are included in the amounts outstanding. NOTE.—All banks that had either discontinued offering or never Details may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

106 Federal Reserve Bulletin • February 1979 2. Small-denomination time and savings deposits held by insured commercial banks on October 25, compared with July 26, 1978, by type of deposit, by most common rate paid on new deposits in each category, and by size of bank Size of bank Size of bank (total deposits in millions of dollars) (total deposits in millions of dollars) Deposit group, original All banks All banks maturity, and distribution of deposits by Less than 100 100 and over Less than 100 100 and over most common rate Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Amount of deposits (in millions of dollars). Number of banks, or percentage distribution or percentage distribution Savings deposits Individuals and nonprofit organizations Issuing banks 1144,,229999 14,338 13,226 13,265 1,073 1,073 203,980 204,847 78,279 78,011 125,701 126,836 Distribution, total... 100 100 100 100 100 100 100 100 100 100 100 100 4.00 or less 4.0 4.1 4.1 4.1 2.8 3.8 2.9 3.2 3.7 3.6 2.5 2.9 4.01-4.50 8.3 8.4 8.5 8.7 5.7 5.0 7.0 7.1 8.6 9.3 6.0 5.8 4.51-5.00 87.6 87.5 87.3 87.2 91.5 91.2 90.1 89.7 87.7 87.2 91.6 91.3 Paying ceiling rate1... 87.6 87.5 87.3 87.2 91.5 91.2 90.1 89.7 87.7 87.2 91.6 91.3 Partnerships and corporations Issuing banks 9,860 9,989 8,803 8,932 1,057 1,057 11,198 10,646 3,467 3,265 7,731 7,381 Distribution, total... 100 100 100 100 100 100 100 100 100 100 100 100 4.00 or less 1.4 1.6 1.5 1.7 .9 .8 .4 .8 1.0 2.1 .2 .2 4.01-4.50 4.6 7.4 4.7 7.9 3.4 3.4 3.8 4.4 3.4 5.8 4.0 3.8 4.51-5.00 94.0 91.0 93.8 90.4 95.7 95.8 95.8 94.8 95.5 92.1 95.9 96.0 Paying ceiling rate1... 93.8 90.8 93.5 90.2 95.7 95.8 95.7 94.8 95.5 92.1 95.9 96.0 Domestic govt, units Issuing banks 8,287 8,023 7,552 7,293 735 730 4,788 4,954 2,618 2,979 2,170 1,976 Distribution, total... 100 100 100 100 100 100 100 100 100 100 100 100 4.00 or less 2.3 2.4 2.5 2.6 .1 1 1.1 1.1 1.8 1.7 .2 .1 4.01-4.50 7.5 9.5 8.1 10.1 1.9 3.4 3.7 3.6 6.1 4.6 • .8 2.1 4.51-5.00 90.2 88.1 89.4 87.3 97.9 96.4 95.3 95.3 92.1 93.7 99.1 97.8 Paying ceiling rate1... 89.9 88.1 89.1 87.3 97.9 96.4 95.2 95.3 91.9 93.7 99.1 97.8 All other Issuing banks 1,237 1,268 1,102 1,106 135 162 114 137 35 33 79 104 Distribution, total... 100 100 100 100 100 100 100 100 100 100 100 100 4 4 . . 0 00 1 - o 4 r .5 l 0 e ss 1 6 2 . . 7 7 1 1 9 3. . 6 0 1 7 3 . . 5 9 2 1 1 5 . . 8 3 (2 2 ) .4 (2 2 ) .0 (2 2 ) .3 (2 1 ) .6 (2 5 ) .2 3. . 2 l (2 1 ) .0 (2 1 ) .0 4.51-5.00 80.7 67.4 78.6 62.9 97.6 98.0 97.7 98.4 94.8 96.7 99.0 99.0 Paying ceiling rate1... 80.7 67.4 78.6 62.9 97.6 98.0 97.7 98.4 94.8 96.7 99.0 99.0 IRA and Keogh Plan time deposits, 3 years or more Issuing banks 9,329 9,338 8,348 8,352 980 986 2,992 2,760 1,167 1,090 1,825 1,669 Distribution, total 100 100 100 100 100 100 100 100 100 100 100 100 6.00 or less 3.4 4.1 3.6 4.3 1.8 2.7 1.2 2.8 .9 2.0 1.3 3.3 6.01-7.00 7.0 7.8 7.5 8.3 2.8 3.8 2.6 2.4 3.6 3.2 1.9 1.8 7.01-7.50 31.2 37.0 31.9 37.8 25.8 30.3 24.1 29.8 28.6 38.7 21.2 24.0 7.51-7.75 58.4 51.0 57.1 49.6 69.7 63.2 72.1 65.0 66.8 56.1 75.5 70.9 Paying ceiling ratei... 34.2 23.4 33.0 22.6 44.4 30.4 46.6 34.6 39.1 29.4 51.4 38.0 Money market certificates, $10,000 or more, 6 months 3 Issuing banks 10,182 8,928 9,127 7,891 1,055 1,036 13,806 5,342 5,309 1,814 8,497 3,528 Distribution, total 100 100 100 100 100 100 100 100 100 100 100 100 7.25 or less 1.9 9.4 2.1 10.4 1 1.7 1.0 3.0 2.1 5.6 .2 1.7 7.26-7.50 4.8 90.6 5.2 89.6 1.5 98.3 1.7 97.0 3.6 94.4 .5 98.3 7.51-8.00 7.1 .0 7.5 .0 4.2 .0 2.5 .0 2.8 .0 2.3 .0 8.01-8.56 86.1 .0 85.2 .0 94.2 .0 94.9 • 0 91.4 .0 97.0 .0 Paying ceiling rate1... 67.2 59.3 65.1 55.7 85.3 86.6 85.0 80.3 75.5 70.5 91.0 85.3 Time deposits less than $100,000 Domestic govt, units: 30 up to 90 days Issuing banks 4,904 4,770 4,227 4,094 677 676 980 918 678 495 302 423 Dis 4 t . r 5 i 0 b u or ti o le n s , s total... 100 .1 100 .7 1 ( 0 2 0 ) 100 .6 100 .8 100 1 .6 100 .3 100 1 .4 1 ( 0 2 0 ) 100 .1 100 .8 10 2 0 .9 4.51-5.00 58.5 50.2 56.6 47.6 69.8 65.5 47.9 43.2 43.5 34.3 57.8 53.7 5.01-5.50 5.8 14.8 5.9 16.1 5.1 6.6 6.4 5.8 7.8 7.4 3.2 4.0 Paying 5.5 c 1 ei - l 8 in .0 g 0 rate1... 1 3 1 5 . . 5 6 34. . 3 2 1 3 0 7 . . 8 4 ( 3 2 5 ) .7 2 1 4 6 . . 3 2 2 1 6 . . 1 2 4 1 5 5 . . 4 7 ( 4 2 9 ) .6 4 9 8. . 7 3 ( 5 2 8 ) .2 2 3 9 8 . . 9 2 ( 3 2 9 ) .5 90 up to 180 days Issuing banks 7,541 7,921 6,708 7,085 833 836 1,084 1,162 727 836 357 326 Dis 4 t . r 5 i 0 b u o t r i o le n s , s total... 100 . 1 100 .1 1 ( 0 2 0 ) 1 ( 0 2 0 ) 100 .7 100 .7 100 . 1 100 . 1 1 ( 0 2 0 ) 1 ( 0 2 0 ) 100 .2 100 .2 4.51-5.00 11.5 16.9 11.8 17.9 9.0 8.2 5.1 13.9 5.3 17.2 4.7 5.5 5.01-5.50 70.8 65.5 70.9 65.0 70.2 70.2 68.9 62.8 69.3 62.3 68.1 63.8 Paying 5.5 c 1 ei - l 8 in .0 g 0 rate1... 1 3 7 . . 4 6 17 . . 2 5 1 2 7 . . 5 3 ( 1 2 7 ) .1 2 1 0 0 . . 1 2 2 1 0. . 9 4 2 7 5 .6 . 9 23. . 3 9 2 3 5 . . 2 4 ( 2 2 0 ) .5 2 1 7 6 . . 0 7 3 3 0 . . 2 4 For notes see end of table. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Survey of Time and Savings Deposits 107 TABLE 2—Continued Size of bank Size of bank (total deposits in millions of dollars) (total deposits in millions of dollars) Deposit group, original All banks All banks maturity, and distribution of deposits by Less than 100 100 and over Less than 100 100 and over mmoosstt ccoommmmoonn rraattee Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Amount of deposits (in millions of dollars), Number of banks, or percentage distribution or percentage distribution Time deposits, less than $100,000 (cont.) Domestic govt. units (cont.) 180 days up to 1 year Issuing banks 5,416 5,488 4,795 4,820 662211 668 661144 664 443322 446644 181 220011 Di 4 st . r 5 i 0 b u o t r i o le n s , s total — 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 4.51-5.00 6.8 9.7 7.0 10.1 4.9 6.7 2.0 3.8 .7 2.0 5.0 7.8 5.01 5.50 67.2 61.7 67.2 61.3 67.1 64.0 63.7 43.0 65.9 38.6 58.6 53.2 5.51 8.00 26.0 28.6 25.8 28.5 28.0 29.3 34.3 53.3 33.5 59.4 36.4 39.0 Paying ceiling rate1... 8.6 3.6 7.6 3.3 16.6 6.0 14.6 11.4 8.0 11.2 30.5 12.0 1 year and over Issuing banks 8,170 8,685 7,376 7,872 793 813 1,013 1,245 854 939 159 306 Distribution, total. . . 100 100 100 100 100 100 100 100 100 100 100 100 5.00 or less 1.3 1.1 1.0 .9 4.3 2.7 .6 .2 . 1 . 1 3.2 .4 5.01-5.50 4.0 3.3 4.0 3.1 4.4 5.4 2.2 1.4 1.8 .7 4.5 3.3 5.51-6.00 58.0 64.2 57.8 64.3 59.0 63.0 55.4 52.8 56.9 60.0 47.4 30.6 6.01-8.00 36.7 31.4 37.2 31.7 32.3 28.8 41.8 45.7 41.2 39.1 44.9 65.7 Paying ceiling rate1... 3.7 1.3 3.0 1.1 9.7 3.9 10.9 6.7 8.5 5.7 23.9 9.5 Other than domestic govt, units: 30 up to 90 days Issuing banks 5,514 6,125 4,635 5,247 879 878 4,346 5,384 990022 11,,111199 3,444 44,,226666 Di 4 st . r 5 i 0 b u o t r i o le n s , s total... 100 .8 10 2 0 . 8 100 .7 10 3 0 .0 100 1 .3 100 1 .7 100 1 .4 10 4 0 . 5 1 ( 0 2 0 ) 100 .1 100 1 .7 10 5 0 .7 4.51-5.00 99.2 97.2 99.3 97.0 98.7 98.3 98.6 95.5 100.0 99.9 98.3 94.3 Paying ceiling rate1... 99.2 97.2 99.3 97.0 98.7 98.3 98.6 95.5 100.0 99.9 98.3 94.3 90 up to 180 days Issuing banks 11,439 11,700 10,384 10,656 1,055 1,044 28,732 29,380 1111,,442299 1111,,664433 17,304 17,737 Di 4 st . r 5 i 0 b u o t r i o le n s , s total. .. 100 .6 100 .6 100 .7 100 .7 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 9 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 4.51-5.00 4.6 5.1 4.9 5.3 2.3 3.3 4.7 4.9 4.6 3.9 4.8 5.6 5.01-5.50 94.7 94.3 94.4 94.1 97.7 96.7 95.3 95.0 95.4 96.0 95.2 94.4 Paying ceiling rate1... 94.2 94.3 93.9 94.1 97.6 96.6 94.9 94.6 95.4 96.0 94.6 93.7 180 days up to 1 year Issuing banks 8,176 8,458 7,296 7,576 880 888822 33,,222299 33,,114400 11,,662266 11,,660066 1,603 11,,553344 Di 4 st .5 ri 0 b u o t r i o le n s , s total. . . 100 . 6 100 .6 100 .5 100 .4 10 2 0 . 0 100 1 .9 100 .2 100 .2 1 ( 0 2 0 ) 1 ( 0 2 0 ) 100 .3 100 .3 4.51 5.00 3.9 4.2 4.1 4.3 2.3 3.2 1.4 .8 2.5 .9 .3 .6 5.01 5.50 95.5 95.2 95.4 95.3 95.6 94.9 98.4 99.1 97.5 99.1 99.4 99.1 Paying ceiling rate1... 95.5 95.2 95.4 95.3 95.6 94.9 98.4 99.1 97.5 99.1 99.4 99.1 1 up to 2 V4 years Issuing banks 13,751 13,769 12,684 12,708 1,066 1,060 30,819 32,788 19,580 20,535 11,239 12,253 Dis 5 t . r 0 i 0 b u o t r i o le n s , s t otal. . . 100 .5 1 ( 0 2 0 ) 100 .6 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 100 . 1 1 ( 0 2 0 ) 100 .2 1 ( 0 2 0 ) 1 ( 0 2 0 ) 1 ( 0 2 0 ) 5.01 5.50 2.0 1.9 2.2 2.0 .4 1.1 .6 1.4 .7 .7 .4 2.5 5.51-6.00 97.4 98.1 97.2 98.0 99.6 98.9 99.3 98.6 99.1 99.3 99.6 97.5 Paying ceiling rate*... 97.3 98.0 97.2 98.0 98.2 97.6 99.0 98.3 99.1 99.3 98.8 96.8 2 Vi up to 4 years Issuing banks 12,822 12,902 11,768 11,853 1,054 1,049 17,352 18,311 10,154 10,797 7,198 7,514 Distribution, total. . . 100 100 100 100 100 100 100 100 100 100 100 100 6.00 or less 2.1 1.9 2.2 1.9 1.3 1.7 1.7 1.1 2.2 .9 1.0 1.5 6.01-6.50 97.9 98.1 97.8 98.1 98.7 98.3 98.3 98.9 97.8 99.1 99.0 98.5 Paying ceiling rate1... 97.7 97.1 97.8 97.1 96.8 97.4 98.0 98.5 97.8 98.9 98.3 98.0 4 up to 6 years Issuing banks 12,920 13,044 11,876 12,002 1,043 1,043 49,260 50,772 27,196 27,895 22,064 22,877 Distribution, total. . . 100 100 100 100 100 100 100 100 100 100 100 100 6.50 or less 1.6 .6 1.7 .5 .3 1.7 .8 .9 1.2 .5 .4 1.3 6.51-7.00 10.0 12.2 10.4 12.7 5.3 7.3 7.4 9.3 10.2 12.9 4.0 5.0 7.01-7.25 88.4 87.2 87.9 86.8 94.4 91.0 91.8 89.8 88.7 86.7 95.6 93.7 Paying ceiling rate1... 88.2 86.9 87.7 86.6 93.9 90.5 91.4 89.6 88.2 86.5 95.3 93.3 6 up to 8 years Issuing banks 10,965 10,765 9,950 9,766 1,015 998 22,667 21,668 10,046 9,718 12,621 11,950 Dis 7 t . r 0 i 0 b u o t r i o le n s , s total... 100 1 .5 100 .6 100 1 .6 100 .3 100 .4 10 3 0 . 3 100 .5 100 .5 100 . 6 1 ( 0 2 0 ) 100 .4 100 . 9 7.01-7.25 3.2 4.8 3.2 5.0 3.7 2.6 2.4 1.6 2.0 1.4 2.8 1.7 7.26-7.50 95.3 94.6 95.2 94.6 95.9 94.1 97.1 97.9 97.4 98.6 96.8 97.4 Paying ceiling rate1... 95.3 94.5 95.2 94.6 95.3 93.2 96.9 97.8 97.4 98.6 96.5 97.1 For notes see end of table. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

108 Federal Reserve Bulletin • February 1979 TABLE 2—Continued Size of bank Size of bank (total deposits in millions of dollars) (total deposits in millions of dollars) Deposit group, original All banks All banks maturity, and distribution of deposits by Less than 100 100 and over Less than 100 100 and over most common rate Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Oct. 25 July 26 Amount of deposits (in millions of dollars), Number of banks, or percentage distribution or percentage distribution Time deposits less than $100,000 (cont.) Other than domestic govt, units (cont.) 8 years and over 3 Issuing banks 7,789 6,186 6,952 5,419 837 767 22,,228888 1,427 732 315 1,557 1,112 Distribution, total 100 100 100 100 100 100 100 100 100 100 100 100 7.25 or less 1.7 1.5 1.4 1.3 4.1 3.5 5.1 3.5 .2 .7 7.4 4.3 7.26-7.50 6.3 3.6 6.0 2.9 8.9 8.9 14.8 28.4 3.0 2.7 20.3 35.7 7.51-7.75 92.0 94.9 92.6 95.9 87.0 87.6 80.1 68.1 96.8 96.6 72.3 60.0 Paying ceiling rate1... 92.0 94.9 92.6 95.9 87.0 87.6 80.1 68.1 96.8 96.6 72.3 60.0 Club accounts Issuing banks 9,225 9,550 8,438 8,735 787 815 2,096 2,121 892 912 1,204 1,209 Distribution, total 100 100 100 100 100 100 100 100 100 100 100 100 0.0D 44.0 48.3 45.6 50.2 27.2 28.5 19.1 24.8 27.0 36.5 13.3 16.1 0.01-4.00 16.2 14.6 16.4 14.7 14.7 13.6 13.4 15.3 21.2 19.6 7.6 12.0 4.01-4.50 6.9 7.6 6.9 7.6 6.4 7.0 8.7 12.8 6.5 13.3 10.3 12.3 4.51-5.50 32.8 29.5 31.1 27.5 51.6 50.9 58.8 47.2 45.3 30.7 68.8 59.6 1 See BULLETIN Table 1.16 on page A10 for the ceiling rates that held at banks that had discontinued issuing deposits are not included existed at the time of each survey. in the amounts outstanding. Therefore, the deposit amounts shown 2 Less than .05 per cent. in Table 1 may exceed the deposit amounts shown in this table. 3 Issuance authorized June 1, 1978. The most common interest rate for each instrument refers to the stated rate per annum (before compounding) that banks paid on the NOTE.—All banks that either had discontinued offering or had largest dollar volume of deposit inflows during the 2-week period never offered particular types of deposits as of the survey date are not immediately preceding the survey date. counted as issuing banks. Moreover, the small amounts of deposits Details may not add to totals because of rounding. years declined over the period, while those with $500 million less than the increase in the prelonger maturities rose moderately. IRAs and vious survey period, and represented the smal- Keogh accounts grew steadily, increasing $200 lest percentage increase for any survey quarter million to a level of almost $3 billion. since introduction of the six-year certificate with Reflecting a diversion of deposits to MMCs, a higher ceiling rate in 1974. as well as the further rise in interest rates on Outstanding levels of all maturities of smallalternative instruments above the regulatory denomination time deposits issued to governceiling rates, the outstanding level of small-de- mental units, except those maturing from 30 up nomination time deposits subject to fixed ceil- to 90 days, registered declines. Over all, such ings declined sharply. Outflows from such ac- deposits declined $300 million during the survey counts totaled $4V2 billion, twice as large as quarter compared with a decrease of $200 milthe drop during the previous survey quarter. lion during the previous survey period. MMCs Among issues other than those to governmental may have attracted a small amount of these units, there were substantial declines in all but funds; but the decline seems to have been due one of the maturity categories under six years, largely to a diversion to other instruments in suggesting that a large portion of MMC balances response to the general rise in interest rates. represents funds that were shifted from these Although banks may pay 8 percent on all time accounts, particularly deposits with maturities deposits issued to governments without regard of two and one-half years up to six years, which to maturity, their offering rates are in general dropped $4Vi billion. However, the consistently low because they are usually required to pledge popular deposits with original maturities of six securities against such accounts. In response to years or more—including the new eight-year rising market rates of interest, a growing certificates authorized on June 1—continued to proportion of banks paid the maximum allowrise, albeit at a reduced pace. The net inflow able rate on all categories of time deposits issued to these accounts was almost $2 billion, about to governmental units. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Survey of Time and Savings Deposits 109 3. Average of most common interest rates paid on various categories of time and savings deposits at insured commercial banks on October 25, 1978 Bank size (total deposits in millions of dollars) TTyyppee ooff ddeeppoossiitt,, hhoollddeerr,, aanndd oorriiggiinnaall mmaattuurriittyy All size Less 20 up 50 up 100 up 500 up 1,000 groups than 20 to 50 to 100 to 500 to 1,000 and over Savings and small-denomination time deposits 5.72 5.82 5.88 5.75 5.71 5.64 5.59 Savings, total 4.93 4.94 4.93 4.85 4.95 4.91 4.94 Individuals and nonprofit organizations 4.92 4.93 4.92 4.84 4.95 4.90 4.94 Partnerships and corporations 4.98 5.00 4.94 4.99 4.99 4.98 4.97 Domestic governmental units 4.97 4.94 4.96 4.94 5.00 4.99 4.99 All other 4.95 5.00 4.48 5.00 4.99 5.00 5.00 IRA and Keogh Plan time deposits, 3 years or more 7.74 7.67 7.76 7.63 7.76 7.77 7.76 Money market certificates, exactly 6 months 8.46 8.07 8.38 8.52 8.51 8.51 8.54 Other time deposits in denominations of less than $100,000, total 6.53 6.42 6.62 6.59 6.54 6.51 6.45 Domestic governmental units, total 6.14 6.04 6.15 6.36 6.04 6.43 6.38 30 up to 90 days 6.10 6.10 6.12 6.15 6.32 6.13 5.93 90 up to 180 days 5.85 5.75 5.52 6.09 5.79 6.56 6.52 180 days up to 1 year 6.12 5.88 6.30 6.78 5.95 6.39 6.84 1 year and over 6.51 6.40 6.50 6.70 6.44 6.83 6.96 Other than domestic governmental units, total 6.53 6.45 6.63 6.60 6.55 6.51 6.45 30 up to 90 days 4.98 5.00 5.00 5.00 4.97 4.94 5.00 90 up to 180 days • 5.47 5.47 5.50 5.45 5.50 5.50 5.44 180 days up to 1 year 5.49 5.48 5.50 5.49 5.47 5.49 5.50 1 up to 2 Vi years 5.99 5.99 6.00 6.00 6.00 6.00 5.99 2Vi up to 4 years 6.48 6.44 6.50 6.49 6.49 6.50 6.49 4 up to 6 years 7.22 7.19 7.21 7.23 7.23 7.24 7.23 6 up to 8 years 7.49 7.48 7.50 7.49 7.49 7.50 7.49 Over 8 years 7.66 7.73 7.75 7.71 7.70 7.57 7.61 Club accounts1 3.77 3.19 3.26 3.22 3.89 3.56 4.56 1 Club accounts are excluded from all of the above categories. amount of that type of deposit outstanding. All banks that had either discontinued offering or never offered particular types of deposit as NOTE.—The average rates were calculated by weighting the most of the survey date were excluded from the calculations for those common rate reported on each type of deposit at each bank by the specific types of deposits. Together with the increase in rates paid on standing volume of interest-bearing, large-dethese governmental deposits, rates on small-de- nomination time deposits almost $12 billion, up nomination issues to nongovernmental entities from the $9L/Z billion increase of the previous rose in five of the eight categories. These de- survey. Large negotiable certificates of deposit velopments, coupled with the rise in interest at weekly reporting banks (not shown in the payments associated with MMCs and IRA and table) accounted for 50 percent of the total Keogh accounts, acted to raise the weighted- advance. Non-interest-bearing time deposits, average rate paid on all small-denomination principally escrow accounts and compensating time and savings deposits 7 basis points to 5.72 balances held in conjunction with loans, depercent. creased $50 million, following an increase of $275 million in the preceding period. Reflecting the seasonal pattern of deposit flows, the level OTHER TIME DEPOSITS of club accounts remained virtually unchanged Growth of bank assets, coupled with compara- at just over $2 billion. About 45 percent of the tively slow growth in deposits subject to interest offering banks, holding a fifth of outstanding rate ceilings, led banks to increase the out- deposits, paid no interest on club accounts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

110 Federal Reserve Bulletin • February 1979 Staff Studies The staffs of the Board of Governors of the In all cases the analyses and conclusions set Federal Reserve System and of the Federal forth are those of the authors and do not neces- Reserve Banks undertake studies that cover a sarily indicate concurrence by the Board of wide range of economic and financial subjects, Governors, by the Federal Reserve Banks, or and other staff members prepare papers related by the members of their staffs. to such subjects. In some instances the Federal Single copies of the full text of each of the Reserve System finances similar studies by studies or papers summarized in the BULLETIN members of the academic profession. are available in mimeographed form. The list From time to time the results of studies that of Federal Reserve Board publications at the are of general interest to the professions and back of each BULLETIN includes a separate to others are summarized—or they may be section entitled "Staff Studies" that lists the printed in full—in this section of the FEDERAL studies for which copies are currently available RESERVE BULLETIN. in mimeographed form. STUDY SUMMARY TIE-INS BETWEEN THE GRANTING OF CREDIT AND SALE OF INSURANCE BY BANK HOLDING COMPANIES AND OTHER LENDERS Robert A. Eisenbeis and Paul R. Schweitzer—Staff, Board of Governors Prepared as a staff paper in the summer of 1978 This paper presents the findings of a study of supplier conduct that promotes tying. In the the existence and extent of tying between the belief that buyer resentment would be strongest granting of credit and the sale of insurance by and most likely to generate complaints in those retailers, bank holding companies, and other cases involving explicitly formal tying, the financial institutions. It was requested by the complaint files of the Federal Reserve System Senate Committee on Banking, Housing and were canvassed. No complaints had been filed Urban Affairs. since 1970 alleging violation of section 106 of The study reports new data on insurance and the Bank Holding Company Act by either concredit activity obtained through two separate sumers or businesses. surveys—one of individual consumers and one The Federal Reserve's 1977 Consumer Credit of bank holding companies—and provides an Survey shows that 62.2 percent of the borrowers analytical framework within which to assess the had purchased credit insurance. The lowest likelihood that tying is taking place. The theo- proportion of borrowers also purchasing insurretical framework implies that the existence of ance from the lender was at retailers and banks, tying, either explicit or involuntary, will be 39.9 percent and 61.4 percent, respectively, manifested in a high proportion of joint pur- while the highest was at finance companies, chases, in buyer perception of and resentment 74.8 percent. These relatively high penetration at being forced to make the purchase, and in rates do not, however, appear to have resulted Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Staff Studies 111 from either explicit coercion or involuntary cates higher penetration rates for credit life and tying. Relatively few consumers responded that disability insurance than for property and casuthe insurance was "required" (16.4 percent) or alty insurance, but these latter rates show wider even "strongly recommended" (8.8 percent); variation by lender group, type of loan, and the lowest proportions were for retailers and location of company. In general, consumer banks. The absence of coercion is supported by loans, mortgage loans, and loans from finance the small proportion of customers who viewed company and bank subsidiaries have the higher credit life and disability insurance as a "bad" median penetration rates. Again, patterns of service. Most regarded it as desirable and, more conduct do not indicate extensive tying since significantly, felt that its price was "about credit insurance is typically offered after the right" or even "inexpensive." credit is approved and, furthermore, most re- The other survey sampled bank holding com- spondents advise the customer that insurance is panies to gather information on policies, proce- not required. dures, and organizational patterns in the selling The results of the study suggest that explicit of insurance. The reported penetration rates on tying between the granting of credit and the sale credit-related property and casualty insurance of credit-related insurance is practically nonexappear significantly lower than would have been istent and that implicit pressures brought by expected if tying were a widespread practice in lenders on the borrowers are neither very strong the industry. Low penetration rates are also nor widespread in the industry. A sizable miconsistent with the respondents' policies and nority of credit customers find it more convenprocedures, which do not seem to be conducive ient to place their property and casualty insurto tying arrangements. Solicitation for insurance ance with their lender than to search for alteris generally reported to be made after the credit native sources of insurance services. The is approved. Moreover, the prevalence of fixed proportion of people opting for joint purchases salaries of insurance agents in large bank hold- of credit and insurance rises greatly among those ing companies, as opposed to commissions, purchasing credit life and disability insurance, lessens the likelihood of coercive tying by these probably because the costs of premiums are institutions. small compared with costs of shopping around The survey of bank holding companies indi- for other sources. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

112 Industrial Production Released for publication February 15 sharply. Production of nondurable goods materials rose moderately, as the output of textile Industrial production in January edged up an and chemical materials advanced. Production of estimated 0.1 percent following an increase of energy materials dropped 0.7 percent, reflecting 0.7 percent in December. Output in January was a decline in coal output; electric power generaaffected somewhat by weather conditions. Pro- tion continued to rise. duction of materials was unchanged in January and output of products rose 0.2 percent. The January index, at 150.7 percent of the 1967 average, was 8.6 percent higher than the January 1978 level, which had been affected by strikes and weather. Output of consumer goods was little changed in January; production of home goods and consumer nondurable goods increased moderately while output of automotive products again declined sharply. Auto assemblies—at an annual rate of 8.9 million units—were about 4 percent below the 9.3-million-unit rate in December. Output of business equipment edged up slightly in January; this gain was limited by a sharp decline in the production of transit equipment, particularly truck production. The output of intermediate products continued to advance, reflecting a further rise in the production of construction supplies. Output of durable goods materials rose only F.R. indexes, seasonally adjusted. Latest figures: January. slightly in January, with steel output declining Auto sales and stocks include imports. 1967 == 100 Percentage change from preceding month to— PPPeeerrrccceeennntttaaagggeee ccchhhaaannngggeee IIInnnddduuussstttrrriiiaaalll ppprrroooddduuuccctttiiiooonnn 1978 1979 1978 1979 111///777888 tttooo Dec.p Jan.'' Aug. Sept. Oct. Nov. Dec. Jan. 111///777999 Total 150.5 150.7 .7 .5 .6 .5 .7 .1 8.6 Products, total 148.7 149.0 .8 .2 .3 .4 .7 .2 7.6 Final products 145.5 145.7 .8 .3 .3 .3 .6 .1 8.0 Consumer goods 150.7 150.8 .5 .4 .1 .4 .6 .1 6.3 Durable 161.9 161.1 .4 -.7 .8 .2 -.1 -.5 10.0 Nondurable 146.2 146.7 .5 .9 -.1 .4 .9 .3 4.9 Business equipment 168.4 168.5 1.0 .2 .7 .2 .7 .1 10.4 Intermediate products .. 160.7 161.4 .5 .4 .6 .6 1.1 .4 6.5 Construction supplies. 160.3 161.2 .8 .6 .9 .7 1.4 .6 8.0 Materials 153.3 153.3 .5 .7 1.1 .8 .5 .0 10.1 p Preliminary. ' Estimated. NOTE.—Indexes are seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

113 Statements to Congress Statement by G. William Miller, Chairman, exchange markets. The attrition in deposits Board of Governors of the Federal Reserve subject to reserve requirements set by the Fed- System, before the Committee on Banking, Fi- eral Reserve weakens the linkage between nance and Urban Affairs, U.S. House of Rep- member bank reserves and the monetary aggreresentatives, January 24, 1979. gates. As a larger and larger fraction of deposits at banks becomes subject to the diverse reserve The nation's financial system has been un- requirements set by the 50 states rather than by dergoing rapid change in recent years, change the Federal Reserve and as more transactions that has altered the competitive environment in balances reside at thrift institutions, the relabanking and other financial markets and com- tionship between the money supply and reserves plicated the Federal Reserve's ability to imple- controlled by the Federal Reserve will become ment monetary policy. Nonmember depositary less and less predictable. Therefore, open marinstitutions have been growing much more rap- ket operations, the basic tool of monetary polidly than member banks. Transactions-type de- icy, are becoming less precise in their applicaposit accounts have become more widespread tion. at thrift institutions. And, in general, competi- Our staff has attempted to assess the extent tion among depositary institutions and between to which growth of deposits outside the Federal those institutions and the open market has be- Reserve System would weaken the relationship come much more intense. between reserves and money. Their tentative This competition promotes efficiency in the results are shown in chart 1, which depicts the financial system, and banks have been reassess- greater range of short-run variability in M-l and ing their costs and operations. Many, as a result, M-2, with a given level of bank reserves, that have become less willing to bear the high cost would develop as the percentage of deposits of cash reserve requirements associated with held outside the Federal Reserve rises.1 As more being a member of the Federal Reserve System. and more deposits are held outside the system, Thus, there has been a steady—and in recent this chart suggests that control of money through years, an accelerating—decline in the propor- the reserve base becomes increasingly uncertion of bank deposits, especially transaction tain. deposits, subject to federal reserve requirements. Moreover, the continued development USE OF RESERVE REQUIREMENTS of new transactions-type deposits at nonbank depositary institutions will further worsen this HAS BEEN RESTRICTED situation. With the proportion of banks subject to federal reserve requirements declining, the ability of the central bank to use changes in reserve re- DEVELOPMENTS WEAKEN MONETARY quirements as a tool of monetary policy has CONTROL been increasingly undermined. Changes in re- It is essential that the Federal Reserve maintain serve ratios not only affect a smaller proportion adequate control over the monetary aggregates if the nation is to succeed in its efforts 1 The attachments to this statement are available on request from Publications Services, Division of Support to curb inflation, sustain economic growth, and Services, Board of Governors of the Federal Reserve maintain the value of the dollar in international System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

114 Federal Reserve Bulletin • February 1979 of deposits today than in the past, but the board impeded because the safety valve provided by also must weigh the potential impact of its ac- the discount window was gradually losing its tions on the membership problem—and hence effective coverage. on its ability to maintain monetary control over the longer run—each time it deliberates on the AND THE PAYMENTS SYSTEM uses of this tool. Such concerns inhibit the FACES DETERIORATION board's freedom of action to conduct monetary policy. If reserve requirements were applied The growth of transactions balances at instituuniversally, as is proposed in H.R. 7, adjust- tions that do not have access to Federal Reserve ments in reserve ratios to affect the availability clearing services also could lead to a deterioof credit throughout the country, or to influence ration of the quality of the nation's payments banks' efforts concerning particular types of de- system. Reserve balances held at Federal Reposits, may again become a more viable mone- serve Banks are the foundation of the payments tary instrument. Moreover, while open market mechanism because these balances are used for operations in U.S. government securities pro- making payments and settling accounts between vide the Federal Reserve with a powerful pol- banks. Nonmember deposits at correspondent icy instrument, it is possible that conditions banks can serve the same purpose, but as more could develop in the future—such as a less ac- and more of the deposits used for settlement tive market for U.S. government securities in purposes are held outside the Federal Reserve, a period of reduced federal budgetary deficits— the banking system becomes more exposed to in which a more flexible adjustment of reserve the risk that such funds might be immobilized requirements might be a desirable adjunct in ef- if a large correspondent bank outside the Federal forts to control the monetary aggregates. Reserve experienced substantial operating difficulties or liquidity problems. A liquidity crisis affecting such a large clearing bank could have As HAS BEEN widespread damaging effects on the banking THE DISCOUNT WINDOW system as a whole because smaller banks might The effectiveness of the Federal Reserve's ad- become unable to use their clearing balances in ministration of the discount window has been the ordinary course of business. The Federal potentially compromised by recent develop- Reserve, of course, is not subject to liquidity ments. Membership attrition and the growth of risk and therefore serves, as the Congress intended, as a completely safe foundation for the transactions balances at nonbank depositary inpayments mechanism. stitutions have resulted in a shrinking proportion of the financial system having immediate access In sum, the major functions of the Federal to the discount window on a day-to-day basis. Reserve System—to conduct monetary policy in The discount window, as the "lender of last the public interest, to provide back-up liquidity resort," provides the payments system with a and flexibility to the financial system, and to basic liquidity back-up by assuring member assure a safe and efficient payments mechabanks the funds to meet their obligations. But, nism—all have been undermined by recent deif the proportion of institutions having access velopments. These developments include, as I to this facility continues to decline, individual have noted earlier, attrition in Federal Reserve institutions could be forced to make abrupt membership and the spreading of third-party adjustments in their lending or portfolio poli- payment powers to nonbank institutions. cies, because they could not turn to the window to cushion temporarily the impacts of restrictive DECLINE IN SYSTEM MEMBERSHIP monetary policies. Risks that liquidity squeezes would result in bank failures could also in- For more than 25 years there has been a contincrease. Thus, the Federal Reserve may find that ual decline in the proportion of commercial its ability to limit growth in money and credit banks belonging to the Federal Reserve. The in order to curb inflation was being unduly downward trend in the number of member banks Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 115 has been accompanied by a decline in the the full burden of reserve requirements. Only proportion of bank deposits subject to federal member banks must maintain sterile reserve reserve requirements. As of mid-1978, member balances; nonmember banks, which compete banks held less than 72 percent of total com- with members in the same markets for loans mercial bank deposits, down about 9 percentage and deposits, and thrift institutions, which inpoints since 1970. Thus, more than one-fourth creasingly are competing in the same markets, of commercial bank deposits—and over three- do not face similar requirements. Thus, memfifths of all banks—are outside the Federal Re- bers are at a competitive disadvantage relative serve System. to other depositary institutions. Among the major countries in the free world, only in the United States has this legislated inequity been DUE TO THE imposed on the commercial banking system. It EXCESSIVE COST OF MEMBERSHIP is no wonder that member banks continue to The basic reason for the decline in membership withdraw from the Federal Reserve. is the financial burden that membership entails. Most nonmember banks and thrift institutions SPREAD OF may hold their required reserves in the form of THIRD-PARTY PAYMENT POWERS earning assets or in the form of deposits (such as correspondent balances) that would be held At the same time, the spread of third-party in the normal course of business. Member powers to thrift institutions is further increasing banks, by contrast, must keep their required the proportion of transactions balances outside reserves entirely in nonearning form. the control of the Federal Reserve. Commercial The cost burden of Federal Reserve member- banks' virtual monopoly on transactions acship thus consists of the earnings that member counts, maintained in the past because of their banks forgo because of the extra amount of ability to offer demand deposits, is being nonearning assets that they are required to hold. eroded. Moreover, recent financial innovations Of course, member banks are provided with have led to widespread use of interest-bearing services by Reserve Banks, but the value of transactions accounts at both nonbank deposithese services is insufficient to close the earnings tary institutions and commercial banks. These gap between member and nonmember banks. developments have increased both the costs and The board staff estimates that the aggregate competitive pressures on banks, no doubt comcost burden to member banks of Federal Reserve pelling members to reevaluate the costs and membership exceeds $650 million annually, benefits of membership and thus playing a sigbased on data for 1977, or about 9 percent of nificant role in membership withdrawals. member bank profits before income tax. The The payments innovations since 1970 are well burden of membership is not distributed equally known to this committee, and include limited across all sizes of member banks. According pre-authorized "bill-payer" transfers as well as to staff estimates, the relative burden is greatest telephone transfers from savings accounts at for small banks—exceeding 20 percent of prof- banks and savings and loan associations, negoits for banks with less than $10 million in tiable order of withdrawal (NOW) accounts at deposits. Further reductions of reserve require- practically all depositary institutions in New ments within existing statutory limits would do England, credit union share drafts, automatic little to eliminate the burden for most classes transfers from savings deposits, and the use of of banks, especially for the smaller banks. electronic terminals to make immediate transfers to and from savings accounts. Growth of these transactions-related, inter- INEQUITY OF COST BURDEN est-bearing deposits has been most dramatic in BORNE BY MEMBER BANKS recent years. For example, NOW accounts in The current regulatory structure is arbitrary and New England have grown from practically zero unfair because it forces member banks to bear in 1974 to 8 percent of household deposit bal- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

116 Federal Reserve Bulletin • February 1979 ances in mid-1978, and one-third of these NOW This bill proposes universal reserve requiredeposits are at thrift institutions. The intense ments by establishing a reasonable set of reserve competition engendered by the introduction of ratios applicable to all deposits at commercial NOW accounts has been accompanied by an banks and to transactions balances at thrift inacceleration of member bank attrition in New stitutions. The definition of transactions ac- England to a rate well beyond that of the nation. counts includes not only demand deposits but This increase in member bank withdrawals is also the growing number of new third-party clearly not just coincidental. payments accounts. Such an approach puts all There is no sign that the intense competition depositary institutions on an equal competitive will abate. Savings accounts authorized for au- basis in the market for transactions deposits and tomatic transfer have grown rapidly at commer- helps assure the continuation of a reserve struccial banks across the country since their intro- ture needed for the efficient conduct of monetary duction November 1; and in New York, NOW policy. accounts, which were authorized November 10 Under this legislation all commercial banks for all depositary institutions in the state, have and thrift institutions with transactions accounts been increasing vigorously. In addition, the would have access to the Federal Reserve dis- Federal Home Loan Bank Board has announced count window. The Federal Reserve could then its intention to authorize savings and loan asso- act as a "lender of last resort" to a broader ciations to oiler payment order accounts, or class of depositary institutions and thereby en- POAs, which are interest-bearing deposits that hance the overall safety and soundness of the can serve many of the same functions as NOWs. depositary system, as well as providing more These developments have caused the distinc- flexibility to financial institutions to respond to tions among banks and thrifts with respect to changing monetary policy. The bill also gives the "moneyness" of their deposits to become all depositary institutions access to Federal Reincreasingly blurred and have prompted the serve services. With the application of an ap- Federal Reserve to reevaluate its existing meas- propriate pricing schedule for such services, this ures of the monetary aggregates and to consider action should improve the efficiency of the paypossible readjustments to reflect the changing ments mechanism, which underlies all of the institutional environment. The most basic nation's economic transactions. But I should measure of transactions balances, M-l, clearly emphasize that open access to system services, should include more than just currency and desirable as it may be, is only practicable if commercial bank demand deposits. And, the the so-called membership problem is resolved, broader aggregates may be redefined to empha- as H.R. 7 does in principle. Without resolution size distinctions by type or function of deposit of the membership problem, open access at an rather than by the institution in which the de- explicit price set for all institutions would only posit is held. Changing the money measures to exacerbate the problem and lead to even greater reflect economic reality, including the wider role reduction in the Federal Reserve's deposit covplayed by depositary institutions other than erage, since services would be available to nonmember banks in the monetary system, would members without bearing the burden of rebe complemented by legislation for universal serves. reserve requirements. BUT CERTAIN MODIFICATIONS OF LEGISLATIVE PROPOSALS POINT H.R. 7 ARE NECESSARY IN THE RIGHT DIRECTION The various features of H.R. 7 redress much The Monetary Control Act of 1979, H.R. 7, of the growing competitive inequity among fiintroduced by the chairman of this committee, nancial institutions and provide a potentially represents a constructive approach to improving improved framework for enhancing the implemonetary control and reducing the inequities in mentation of monetary policy. However, as markets in which depositary institutions are drafted, certain provisions of this legislation competing. compromise the improvement in monetary con- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 117 trol that universal reserve requirements could to increase the slippage between reserves and foster. deposits and thereby diminish monetary control. First, the exemption from any reserve re- In a comparison of the impacts of the board's quirement of the first $50 million of transactions proposal with H.R. 7 and with the current balances and the first $50 million of other de- reserve system, the board's modification has the posits reduces somewhat from present levels the advantage of greatly increasing the proportion proportion of deposits subject to federal reserve of commercial bank transactions deposits covrequirements. More importantly, though, the ered by an account at the Federal Reserve— rather complex procedure for indexing the ex- from the present 73 percent to 94 percent. This emption would mean that the proportion of would be accomplished even though the $10 deposits subject to direct Federal Reserve con- million exclusion would mean that 45 percent trol could not increase over time. Hence, the of all commercial banks, as well as virtually board believes that the bill needs to be modified, all thrift institutions, would not be required to and it has a proposal that will both enhance hold any account at the Federal Reserve. At the monetary control and preserve for all institutions same time, the number of banks holding nonthe earnings protection of the exemption con- earning reserve balances at Federal Reserve tained in the bill without increasing the cost to Banks would be as low as under H.R. 7. The the Treasury from that associated with H.R. 7. number would be sharply reduced from the current level of 5,664 to an estimated 656. Finally, the effect on bank earnings would be virtually the same under either H.R. 7 or the bill as modified by the board's proposal. The PARTICIPATION IN FEDERAL RESERVE difference would be that under our proposal, EARNINGS FOR EXEMPTED DEPOSITS banks would hold some assets in the form of The board's proposed modification involves es- the earnings participation account rather than as tablishment of an "earnings participation ac- market investments or loans. count" at the Federal Reserve to be held against The return on this account would be equivadeposits exempted by H.R. 7 from reserve re- lent to the average return on the Federal Requirements. To reduce the recordkeeping bur- serve's portfolio, which includes both short- and den, small institutions could be excluded from long-term securities. In some years this return having to hold this account. This exclusion might be higher than banks would earn on other could amount to the first $10 million of transac- assets—which are likely to be a combination tions deposits at each institution and $10 million of loans and liquid instruments—and in some of other deposits at each commercial bank. years, less. On average, over time, there should For banks, with respect to all deposits, and be little difference. for other depositary institutions, with respect to I would like to underline the advantage of transactions deposits, their earnings partici- bringing transactions-type deposits at thrift inpation account would be held against deposits stitutions under reserve requirements in this above the $10 million exclusion and up to the manner. It will be several years, at least, before amount of the $50 million exemption in H.R. any significant number of thrift institutions 7. The size of this earnings participation account would actually have to hold nonearning reserves for each deposit category would equal the re- at the Federal Reserve. Currently, no savings serve ratio applicable to deposits in that category and loan association or credit union has transtimes the amount of deposit liabilities between actions deposits in excess of the $50 million $10 million and $50 million. To the extent that exemption. Only eight mutual savings banks an institution holds vault cash in excess of its have transaction accounts in excess of the exrequired reserves on nonexempt deposits, the emption, and each has vault cash considerably size of the earnings participation account would in excess of the reserve requirement that would be reduced correspondingly. This provision re- apply to such deposits. duces the possibility that institutions would In a listing of individual member and nonbuild up their excess reserves, which would tend member commercial banks and mutual savings Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

118 Federal Reserve Bulletin • February 1979 banks similar to that shown on pages 17 to 65 tary policy. At the same time, it would sustain of the committee print, Description of the Mon- the earnings benefits of the exemption level for etary Control Bill, an asterisk indicates a bank all depositary institutions—at no additional cost added to the list by the board's proposal—that to the Treasury. Finally, exclusion of the first is, one with deposits above the excluded level $10 million of transactions-type deposits and but below the exempted level. These added $10 million of other deposits from the earnings banks would hold an earnings participation ac- participation requirement would reduce the reccount (EPA) at the Federal Reserve, but they ordkeeping burden of the proposal, with relawould not hold any nonearning required re- tively modest policy impact. The board has serves balance at Reserve Banks because their suggested a series of amendments to H.R. 7 that deposits are below the exempted level. Banks would implement the proposed modification. without an asterisk were on the committee list Another modification proposed by the board before, and their nonearning reserve balance is concerns affiliated institutions. Providing an exaffected exactly the same as in H.R. 7. The emption from required reserves of $100 million column entitled EPA shows the amount of the in deposits gives an incentive to banks to form earnings participation account each institution new, affiliated commercial banking entities in would hold. If this column is zero, the bank lieu of branch offices in order to avoid the at the end of 1977 had sufficient vault cash in requirement to hold sterile reserves. A bank as excess of its required reserves so that it would large as $100 million would already enjoy many have had no EPA. of the economies of scale associated with larger Thus, the additional institutions brought banking operations. Thus, the cost of creating under Federal Reserve control would keep the new banks would be small relative to the benefit earnings benefit of the exemption level proposed of avoiding reserve requirements. To eliminate by H.R. 7, since they would participate in the this potential loophole, the board proposes that Federal Reserve's earnings on the balances that affiliated commercial banks be limited to a total they would be required to maintain in the EPA. exemption equal to the number of such institu- Moreover, the cost to the Treasury would be tions as of August 1, 1978, times the exemption no different under the board's proposal than levels specified in the bill. under the proposed bill. Under the board's plan, Mr. Chairman, I want to thank you for the the Federal Reserve would earn additional in- opportunity to present the Federal Reserve's terest on the greater amount of balances that view on the Monetary Control Act of 1979. This would be held at Reserve Banks, thereby off- bill deals constructively with issues of crucial setting the cost of the depositary institutions' importance to the long-run viability of the na- EPAs. tion's central bank and to the health of our In sum, the board proposal would have the financial system. The problems are difficult, but clear advantage of expanding significantly the considerable progress has been made in recent coverage subject to reserve requirements, months toward achieving a solution that prothereby enhancing the implementation of mone- motes the public interest. • Statement by G. William Miller, Chairman, by expressing the views of the Board of Gover- Board of Governors of the Federal Reserve nors of the Federal Reserve System on the System, before the Committee on the Budget, nation's economic problems and prospects, I U.S. House of Representatives, January 25, can be of some assistance to you as you frame 1979. the First Concurrent Budget Resolution for the 1980 fiscal year. Mr. Chairman, members of this distinguished The current economic expansion is nearing committee, I am pleased to be able to participate its fourth anniversary. This makes it quite venin these important hearings. It is my hope that erable in comparison with past cyclical up- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 119 swings—especially when one exempts from increased somewhat faster, reflecting in part a consideration those that have owed their lon- hike in the federal minimum wage, and emgevity to the stimulus of war spending. More ployers were confronted with bigger tabs for important, it has achieved this ripe age without social security and unemployment insurance. losing its vitality. Although the growth of ac- With productivity virtually unchanged, unit tivity has slowed in the past year from its earlier labor costs rose about 9 percent in 1978, 2 very brisk pace, the gains have continued to percentage points more than in 1977. exceed the trend rise of potential output and The worsening of U.S. price trends was a have produced sizable increases in employment. major cause of the dollar's weakness in foreign Real gross national product advanced 414 exchange markets last year. Although the propercent over the past four quarters, as compared gram announced by the Treasury and the Federal with the 5V2 percent average annual rate of Reserve on November 1 succeeded in strengthincrease during the earlier stages of the expan- ening the dollar, its average exchange value sion. Total employment rose 3.3 million during against other major currencies, on a trade- 1978—just slightly less than in the preceding weighted basis, has registered a net decline of year. This was enough to cut the overall rate 15 percent since September 1977. This depreof unemployment almost 1/2 percentage point ciation in turn is having a significant impact on to 5.9 percent despite continued rapid growth domestic inflation, by raising import prices and of the labor force. reducing competitive restraints on the prices of The progress of the past year has, in fact, domestically produced goods. The effect on the appreciably narrowed the margin of unutilized U.S. price level last year probably amounted resources in the economy. Utilization rates for to about 1 percent, and further inflationary efindustrial capacity have risen, and although by fects will be felt this year and next. and large they remain below the peaks of some It is quite clear that last year we passed from earlier cyclical upswings, there are some areas a phase in the economic cycle when the focus of tightness. Similarly, in labor markets the of concern is properly the insurance of strong overall unemployment rate is still rather high aggregate demand to one in which emphasis by historical standards, but there is growing must be placed on the avoidance of inflationary evidence of tautness in various sectors, and excesses. firms generally are finding it increasingly diffi- The Federal Reserve had begun to assume a cult to hire workers with needed skills. These less accommodative stance in 1977, but the developments are a normal accompaniment of movement toward restraint accelerated in 1978. economic expansion and to date have not System resistance to inflated demands for money reached toublesome dimensions. However, we and credit was reflected in a substantial rise in certainly have arrived at a stage in which re- market rates of interest. Yields on short-term source constraints could quickly become a market instruments generally rose 3 to 4 perserious problem if aggregate demand were per- centage points last year, while most long-term mitted to grow faster than productive capacity. rates rose a percentage point or more. The importance of this consideration cannot These are sizable increases and they brought be overstated because inflation is an urgent many rates close to, and in a few cases slightly concern and a clear danger to the health of our above, their 1974 peaks. However, this increase economy. Even in the absence of excessive in interest rates did not occasion the wrenching aggregate demand pressures last year, inflation of financial markets that has seriously disrupted accelerated markedly. The general level of economic activity on some past occasions. prices rose about 8% percent, versus 6V2 percent There are two reasons for this. One is that in 1977. Special factors such as the influence current interest rate levels are not extraordinary of poor weather and the beef cycle on farm after allowance is made for the prevailing state prices played a role in this disappointing per- of inflationary expectations. Nominal interest formance, but there was also a broad intensifi- costs of 9 or 10 percent would have been a cation of price pressures across the economy severe deterrent to credit-financed spending in associated with rising unit labor costs. Pay rates periods when inflation was more subdued; bor- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

120 Federal Reserve Bulletin • February 1979 rowers are much more willing to pay such rates, course, with the 1980 fiscal year. This period, however, when they expect incomes and prices commencing next October, seems quite distant of goods to rise at paces comparable to those in terms of our ability to project with precision experienced recently. the condition of the economy. We must, how- The second reason that we have avoided what ever, base our policy judgments on a tentative is commonly characterized as a "credit crunch" assessment of the likely trajectories of producis the structural changes that have occurred in tion, employment, and prices. There is a broad the nation's financial markets. Among the most consensus that inflationary pressures are going noteworthy of these is the action taken by the to remain strong for some time and that governfederal regulatory agencies last spring to ease mental policies will have to be designed with the restriction on interest rates that depositary containment of those pressures as a high priorinstitutions may pay on time accounts. The new ity. There is considerably less accord regarding six-month money market certificate, whose prospects for economic activity. ceiling varies weekly with Treasury bill rates, The Federal Reserve does not consider a has provided banks and thrift institutions with recession desirable. "Stop-go" patterns of ecoan instrument that can compete effectively for nomic growth have discouraged producsavings even when invest rates on market tivity-enhancing investment and brought no securities are relatively high. Thus, we have not lasting relief from inflation. A policy directed seen the disintermediation of loanable funds that at fostering a sustained, though modest, rise in might have abruptly curtailed the availability of economic activity in the period ahead offers the credit—at any reasonable price—to homebuyers best hope of achieving progress toward the and other borrowers who are heavily reliant on nation's economic goals. the depositary institutions for financing. It is our assessment that conditions do, in This is not to say that rising interest rates fact, favor continued expansion. An examinahave been stripped of their impact on economic tion of available indicators suggests that the developments. The increase in rates last year economy currently is in reasonably good balcontributed to a slowing in the growth of the ance. The final quarter of 1978 was a strong monetary aggregates and to a reduction in ag- one, with real GNP rising at an annual rate of gregate credit flows to the nonfinancial sectors about 6 percent and sizable gains being posted of the economy. In the process, monetary policy in employment and income. This momentum, worked to moderate the expansion of economic coupled with the tax cut that takes effect this activity. month, should impart considerable strength to At the same time that the Federal Reserve final demand in the current quarter. was moving in the direction of restraint, the It is to be expected that, as time passes, Congress and the administration were adjusting growth in consumer spending will moderate their fiscal plans to take account of the reality from its recent exuberant pace. The proportion of unexpectedly rapid inflation. At this time last of disposable personal income devoted to conyear, attention was being focused primarily on sumption has been exceptionally high of late, an expected need to provide stimulus to the and with household debt burdens at record economy in fiscal year 1979. The First Concur- levels, consumers are likely to spend a little less rent Budget Resolution specified a federal deficit freely in the year ahead. In the business sector, of almost $60 billion—an increase over FY advance indicators of plant and equipment ex- 1978. Subsequently, when it became evident penditures have given mixed signals. Surveys that economic circumstances had changed, there of spending plans point to somewhat smaller was a significant shift in the direction of fiscal gains in outlays for this year than last, but data policy. This committee and its counterpart in on actual orders and contracts have suggested the Senate are to be commended for their timely a fairly robust investment demand. On balance, action in reducing the deficit in the Second it appears reasonable to expect that capital out- Budget Resolution to $39 billion. lays will continue to rise, with some upward The discussions now under way deal, of revision in spending plans possible as confi- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 121 dence in the sustainability of expansion is bol- The monetary and fiscal actions taken over stered. Businessmen will likely maintain their the past year to slow inflation have only begun cautious policies with respect to inventories, but to exert their effects. The administration's stocks generally are lean and so there is little wage-price standards and other anti-inflation present danger of a recession-inducing effort to initiatives can be successful only if they are cut back inventories. backed up by macroeconomic policies of re- Housing starts will probably begin to taper straint. We must not despair because an inflation off soon from the high plateau of the past year, that has been woven into the fabric of the as the rise in mortgage interest rates affects economy over the course of a decade has not housing demand. The decline in residential been and cannot be brought to a halt within a construction promises to be moderate by com- short interval. This is a time for patience. We parison with past building cycles, however, must find the courage to adhere for a sustained because of the strong underlying demands asso- period to the course of policy we have charted. ciated with demographic trends and because The implications for federal budgetary stratcredit will remain generally available except, egy are, I think, clear. From the standpoint of perhaps, where local usury ceilings are a barrier. aggregate demand control, we must continue on Government purchases of goods and services a path toward a balanced budget. By moving probably will post only a small increase in 1979, as promptly in this direction as economic ciras the national mood expressed in Proposition cumstances permit, undue reliance on monetary 13 and like measures suggests that public policy can be avoided and pressures on our spending will not exhibit the buoyancy of past financial markets can be minimized. The reducyears. Finally, our trade balance should improve tion in federal credit demands associated with markedly, reflecting the impact of relatively a smaller deficit would release financial refaster economic growth abroad and the lagged sources to the private sector. The dimensions eff ects of exchange-rate changes on both exports of the Treasury's presence in the credit markets and imports. during recent years are inadequately recognized. In all, real GNP expansion seems likely to In addition to the massive unified budget deficits persist at a modest pace over the course of 1979. that have been recorded year after year, the Unemployment could well drift upward in such government has had to finance a growing range an environment, but at this time there is no of off-budget activities. The federal off-budget foreseeable development of cumulative imbal- agencies ran up a $10 billion deficit in FY 1978, ances that will cause the economy to go into and it appears that the figure for the current recession during this year. fiscal year will be at least as large. The conse- Any rise in unemployment implies social quences of this for Treasury borrowing are incosts that one would wish to avoid. It is most dicated in an attached chart.1 Since the beginning of this decade, the outstanding Treasury certainly true as well that there are dangers that debt has much more than doubled, absorbing unanticipated shocks—from international or dobillions of dollars of credit that could have been mestic sources—could cause the economy to used productively in the private sector. slip into recession. But an effort to bolster aggregate demand through more expansive Our chances of solving the problem of inflamonetary or fiscal policies would be fraught tion would also be enhanced if we could slow with even greater perils. We simply cannot the growth of federal spending and thereby afford at this juncture to risk an intensification reduce the size of the government sector in the of inflationary pressures. A further acceleration economy. This would do much to improve the of inflation—or even a significant reduction in climate for private capital formation. The modconfidence here or abroad in the government's commitment to gain control of the general price level—would set in motion forces that almost 1 The attachments to this statement are available on request from Publications Services, Division of Support surely would lead eventually to a serious eco- Services, Board of Governors of the Federal Reserve nomic downturn. System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

122 Federal Reserve Bulletin • February 1979 ification of our tax structure to encourage saving tially higher levels of business investment in the and investment would have a similar salutary years ahead. effect. The budgetary policies I have described imply Our nation has paid a heavy price for its a period of austerity. During this period, rehaving given inadequate attention to the need sources would be diverted from private confor business investment. Our capital stock has sumption, and, at the federal level, new spendnot grown as rapidly as our labor force in recent ing programs may have to be delayed and existyears, and this has played a major role in the ing programs reexamined to ensure that they are poor performance of productivity. Over the past meeting social needs effectively and economifive years, annual gains in output per hour in cally. I believe that the American people are the nonfarm business sector have averaged less prepared to make this sacrifice in order to win than 1 percent as compared to Wi percent in the battle against inflation. They recognize that the preceding five years, and 2% percent during inflation is eating away at the foundations of the first two decades of the postwar period. This our economic structure and imposing a cruel toll slowdown has retarded the rise in living stand- on those in our society who can least afford ards and has aggravated our inflation problem it. It is incumbent upon those of us in governthrough its adverse impact on unit labor costs. ment to respond with prudent and realistic We should set our sights on achieving substan- policies. • Statement by Philip E. Coldwell, Member, 5.4 percent over estimated 1977 expenses. I am Board of Governors of the Federal Reserve pleased to report that preliminary results for System, before the Committee on Banking, 1978 were $718 million or 5.3 percent above Housing and Urban Affairs, U.S. Senate, Jan- the year earlier. Similarly, the Reserve Banks uary 26, 1979. reduced employment by 650 people compared with our budget estimate of a 486-person de- Mr. Chairman, on behalf of the Board of Gov- cline. All of this occurred despite an estimated ernors of the Federal Reserve System, I am 7 percent increase in the volume of measured pleased to comply with your committee's re- activities and enlarged responsibilities in superquest to testify on the Federal Reserve System's vision and regulation. 1979 budget. In my closing remark last Febru- The Board of Governors' operating expenses ary at the 1978 hearings, I stated: "The Board estimated for 1978 were below the operating believes that its review and budget processes budget by $750,000 or 1.6 percent. Here again, have created an atmosphere of cost-con- volume increases and new programs were imsciousness that has resulted in better produc- plemented by internal reallocations of personnel tivity, cost efficiency, service to the public, and and funds. ultimate savings to the tax-paying public." This We estimate that unit costs of measurable testimony on the results for 1978 and the production at the Reserve Banks declined planned 1979 budgets of the Federal Reserve sharply during 1978 despite the 8 percent infla- Banks and the Board of Governors, in our view, tion rate and rising labor costs. Such increases provides confirmation of that statement. in productivity reflect the system-wide commitment to operational improvements and the intensified cost competition among the Reserve Banks. While the dramatic improvements of 1978 EXPERIENCE 1974-78 seem likely to slow in coming years, You will recall that the 1978 Reserve Bank these are still some improvements, which we operating budgets were set at $722.2 million or hope to realize in the period ahead. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 123 1979 BUDGET FOR THE tions from support and overhead services nec- FEDERAL RESERVE BANKS essary to ensure the continuity and/or the efficiency of operations. The Board of Governors approved a budget of Expenses for services to financial institutions $754.0 million for the operating expenses of the and the public and those for services to the U.S. Federal Reserve Banks in 1979, an increase of Treasury and government agencies constitute 75 $36.0 million or 5.0 percent over estimated percent and 11 percent, respectively, of the 1978 expenses, but this amount has been re- budgeted 1979 expenses. With a projected induced by $1.3 million due to a recent decision crease in volume from 1978 to 1979 of 6.9 on retiree benefits. The adjusted 4.8 percent percent, expenses for services to financial instiincrease in operating expenses compares with tutions and the public are projected to increase an average annual growth rate of 13.6 percent 4.8 percent or $26.0 million and expenses for from 1970 through 1974; 7.5 percent from 1974 services to the U.S. Treasury and government through 1977; and a 5.3 percent increase in agencies are projected to increase 3.6 percent 1978. or $2.9 million. In these volume-related areas, Capital outlays are estimated to be $72.5 unit costs are projected to decline 2.2 percent million in 1979, increasing $4.8 million from without adjusting for inflation. the 1978 estimate and providing primarily for Services to financial institutions and the pubdata processing and data communications lic primarily relate to the payments mechanism equipment; new building projects at Baltimore, function and the cash function. During 1979, Miami, and San Francisco, and renovations; the production of payments services will be high-speed currency equipment; and building most affected by the promotion of the automated machinery and equipment. Total outlays of clearinghouse program. This program involves funds (capital plus operating expenses adjusted expanding automated payments as an alternative for depreciation) are expected to reach $802.7 to paper checks. These automated payments will million, representing an increase of 4.4 percent be faster, cheaper, and more reliable than paper over estimated 1978 outlays. entries. The major components of the,program In 1979, the Federal Reserve Banks anticipate will be to stimulate the growth of automated operating with a staffing level of 23,161, a clearinghouse volume by working with the decrease of 489 employees or 2.1 percent from Treasury and the National Automated Clearing the 1978 estimated level, which was 650 em- House Association to plan new programs and ployees or 2.7 percent below the 1977 level. improved operating schedules and to improve During the five-year period beginning in 1974, system automated clearinghouse operations. Inemployment has been reduced by 3,482, an creased governmental electronic payments and average annual rate of decline of 2.8 percent. increased private debit and credit transactions Productivity gains, adjusted to reflect the costs in 1979 are expected to raise substantially autoof substituting capital for labor, average 9.9 mated clearinghouse volume. percent per annum from 1974 through projected Before leaving our plans for the payments 1979—a rate considerably higher than estimates system, I should mention something about Fedfor the private sector. The 1979 budget-year eral Reserve float, which has had an upward estimate of this productivity measure is 8.3 trend over the past few years, particularly in percent. 1978. Part of this trend is due to the rising dollar Having reviewed the Federal Reserve Banks' volume of checks processed through the Federal expense and employment records, I would now Reserve—up about 57 percent since 1974. As like to describe the activities for this year by this committee is aware, the Federal Reserve four groups of expenses, which represent the System has been concerned with reducing its ongoing Federal Reserve Bank responsibilities operating costs, and this has involved a learning expressed in terms of the broad categories of process to balance properly cost reductions, output generated by the system. These groups float, quality of service, and our regulatory and are on a fully costed basis, reflecting realloca- supervisory responsibilities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

124 Federal Reserve Bulletin • February 1979 The cash concentration and cash management to achieve more cost reductions through joint practices of corporations interested in maximiz- planning, development, and implementation of ing the time value of funds have increased the transportable computer software. potential for exploiting the Federal Reserve's Expenses for activities involving supervision deferment schedule and its float. Remote dis- and regulation constitute 9 percent of the budbursement is an abuse of the check collection geted 1979 expenses and are expected to exceed system that the board is working to eliminate the estimated 1978 level by $4.9 million or 7.8 and you have been provided with a report on percent. This area has been heavily impacted this matter. Another cause that has had an in recent years by the added responsibilities of impact on system float, particularly during the consumer regulations, bank holding company past two years, is severe weather and its effect supervision, and processing of holding company on the movement and clearing of checks. The applications. In 1979 the workload will be fursystem is very concerned with the causes and ther intensified due to the passage of the Intereffects of its rising float and is taking steps to national Banking Act, the development and exreduce it. I anticipate improvements in this area pansion of data surveillance systems, the added and believe that the system will be successful applications processing requirements estabin reducing its float this year. lished by the Community Reinvestment Act, In the cash function, the $1 coin will be and the implementation of various sections of introduced in 1979, and more high-speed cur- the Financial Institutions Regulatory and Interrency equipment will become operational. The est Rate Control Act. A major project expected high-speed currency equipment will count the to be completed in 1979 involves the review currency, detect counterfeit notes, sort mixed of all Federal Reserve regulations to determine denominations, determine the fitness of notes, the organizational scheme and framework and destroy notes deemed unfit for circulation, within which all Federal Reserve regulations all at the rate of about 50,000 notes per hour. should be issued and to determine the extent Utilization of these machines will provide a to which they are meeting current policy goals. better quality of currency to return to circula- In addition, the review will require that we tion, provide a greater degree of accuracy, and redraft all Federal Reserve regulations to incorreduce the level of manual involvement. porate changes in policy, format, and style. Services to the U.S. Treasury and govern- The expenses of the final expense group, ment agencies are primarily concerned with monetary and economic policy, constitute 5 savings bonds, other Treasury issues, and food percent of the budgeted 1979 expenses and are stamp activities. Two developmental projects in expected to exceed the estimated 1978 level by this area are expected to be completed in 1979. $2.2 million or 6.0 percent. This service area Both relate to the marketing, safekeeping, and provides economic information and analysis servicing of U.S. government securities. One necessary for effective conduct of monetary project involves identifying future control safe- policy and for bank regulatory policy decisions guards and other operational factors that must both at the district and system levels. During be considered in transferring government se- 1979, expanded programs will encompass evalcurities among Federal Reserve Banks by auto- uation of new market developments, research mated means. These findings will be coordi- on various aspects of monetary control, and nated with those from other areas, such as funds regional and local research, together with retransfers, in the final design specification for the views of many statistical collection and report- Federal Reserve communications requirements ing requirements. in the 1980s. The second project involves the The adjusted $34.7 million increase in 1979 joint development and installation of computer budgeted Federal Reserve Bank operating exprograms by San Francisco, Kansas City, and penses over 1978 estimated expenses is pri- St. Louis in order to automate the transferring marily attributable to salaries and benefits, of securities and the accounting for collateral. which account for 58 percent or $20.3 million This pilot resource-sharing project is designed of the total increase. Retirement and other ben- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 125 efits expenses are expected to increase 7.4 per- The $1.7 million increase in postage and cent due to increased contributions for both other shipping expenses reflects a 6.2 percent current-service and retired personnel. Current and a 1.5 percent increase, respectively. The service benefits will increase due to higher rates relatively low increase in other shipping exfor Social Security, group life insurance, and penses is attributable to the pursuit of favorable hospital and medical insurance, and due to the contractual arrangements with carriers. There higher salary base. are recent developments, however, which may Salary expenses for officers and employees reverse these gains. Decisions by the Departare budgeted to increase 4.3 percent, reflecting ment of Labor with confirmation by the Departthe planned 2.1 percent decrease in employment ment of Justice may force the system to comply and a 6.5 percent increase in average salary per with the Service Contract Act for all these capita. This personnel compensation program is services. Courts, in prior years, have held that within the President's guidelines for wage and Federal Reserve Banks were not agencies of the benefit increases. The Federal Reserve Banks' federal government for purposes of legislation policy for salary programs is to set wage levels of this kind. If this new position is sustained, on the basis of salary movements within the we expect millions of dollars to be added to respective communities. These movements are the cost of our transportation services since we estimated through periodic surveys of salaries will have to pay union scale wages, even in of both financial and nonfinancial corporations areas of the country where market alternatives that represent major employers within each are available at considerably lower prices. market. This broad-gauged reference is maintained in order that the Federal Reserve Banks can draw from a pool of workers with experi- 1979 BUDGET FOR THE ence in several different industries. BOARD OF GOVERNORS Increased equipment expenses represent 14 percent of the total budget increase with an The 1979 approved operating budget for the increase in equipment depreciation, repairs, and Board of Governors is $49.9 million, repremaintenance being partially offset by a decrease senting an increase of $2.9 million or 6.2 perin equipment rentals. The rise and fall in these cent over 1978. This increase compares with expense categories reflect the transition from the federal government's fiscal year 1979 budget rental to owned equipment, equipment upgrad- increase of 9.3 percent over fiscal year 1978 ing, and the acquisition of high-speed currency and the projected fiscal year 1980 budget inprocessing equipment. crease, which is 7.7 percent over fiscal year The increased cost of Federal Reserve cur- 1979. rency accounts for another 13 percent of the The board's 1979 year-end authorized posiadvance in the total budget of the Federal Re- tion level is projected at 1,510, a reduction of serve Banks. This expense is largely beyond the 68 from the 1978 year-end authorized level of control of the Federal Reserve Banks since the 1,578. Staffing projections in 1979 comply with Bureau of Engraving and Printing sets the price the hiring constraints of the federal government. for printing and the public demand determines The significant reduction in authorized positions the volume to be issued. Such costs are expected at the board will be accomplished by continuing to increase more than $4 million over 1978, improvements in productivity and efficiency and reflecting a higher unit price from the bureau by eliminating or reducing low priority funcand a larger demand for currency. tions. In making these reductions in staff, the Increases in building-related expenses include board is accepting some risk of reduced responhigher property depreciation, primarily reflect- siveness to new tasks but feels this action is ing completion of the new Richmond Federal appropriate to government policy. Reserve Bank building. In addition, utility ex- The supervision and regulation of financial penses are expected to increase due to higher institutions, including their role in consumer rates. affairs, is the only area of board responsibility Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

126 Federal Reserve Bulletin • February 1979 in which significant growth is expected in 1979. total expenses to 4.5 percent to 6.5 percent The resources allocated to this area will increase while providing for continued high quality in by 9.7 percent as we move to strengthen com- all system services and continued investment in pliance review, and our ability to meet new improvement of system activities. The projected requirements imposed by the Congress in the 4.8 percent increase in total expenses over the Community Reinvestment Act, the Financial 1978 estimate conforms with the board-ap- Institutions Regulatory and Interest Rate Control proved budget objective, which assumed total Act (FIRA), and the International Banking Act. salary expenses would not exceed 5.0 percent The resource impact of this legislation has not system-wide, while employment would decline been completely assessed, and additional fund- 1.5 percent. This assumption compares with a ing is likely to be required. For example, the budgeted increase of 4.3 percent in total salary Financial Institutions Regulatory Council estab- expenses and a decline of 2.1 percent in emlished by FIRA has not been activated. There- ployment. fore, associated support requirements have not Similarly, the board's 1979 budget was debeen determined and no budget provision has veloped under tight constraints. The board esbeen made. A budget supplement probably will tablished an initial 7.35 percent limitation on be needed to cover these costs. the increase in total operating costs over the The increase in the board's operating budget 1978 estimated expense base, and a 5.5 percent mainly reflects a 5.5 percent increase in salaries, limitation on the increase in personnel costs. retirement, and employee insurance (excluding Since the costs of continuing board operations lump sum payments for retiree cost-of-living at the 1978 resource level would have required increases and cost of new legislative mandates). an increase of more than 9 percent, the effect These personal services account for 80 percent of these constraints is a marked reduction in of the board's operating budget. Nonpersonal resource levels below those of 1978. services are being held to an increase of 1.5 In the preparation of the 1979 budgets, the percent. This low rate is attributable to: (1) Federal Reserve Banks experimented with the savings in rentals resulting from a move of use of zero-base budgeting in their planning and elements of the board's staff from rented to budgeting systems. While there were widely board-owned facilities, and (2) economy meas- varying applications of zero-base budgeting, the ures taken throughout the board's operations. consensus is that the process did assist the The board's capital budget totals $1.2 mil- Reserve Banks in their 1979 planning processes lion, representing a reduction from 1978 esti- by concentrating on the reevaluation of existing mated capital outlays of $8.1 million. The funds programs, reviewing program and resource alin this capital budget were previously approved ternatives, and redirecting resources between by the board to cover the renovation of the main new initiatives and programs in place. During board building and construction of additional 1979 several Reserve Banks intend to integrate offices in our annex building. Both projects will zero-base-budgeting concepts further into their be completed in mid-1979. management processes and to test the possibility of establishing a rotating zero-base review process. As with the 1978 budget, the board's divi- SUMMARY sions used zero-base-budgeting procedures to The system policy of reducing resource expen- develop their program budgets, including data ditures has been expressed and achieved through processing resource requirements. The zerosetting objectives, adapting established budget- base decision packages were used as the basis ing procedures to meet the organization's for budget reviews conducted by staff and framework, and emphasizing operations im- members of the board serving on various overprovements. The 1979 budget objective for the sight committees. The effect of these reviews Federal Reserve Banks limited the increase in was to reduce already constrained budget re- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 127 quests by some $1.9 million and to eliminate pected to rise approximately 7 percent and sub- 68 positions, bringing the projected 1979 au- stantial new regulatory requirements face the thorized staffing down to near the 1974 level. system in 1979, further reductions in staff are In summary, the performance record of the anticipated and increases in expenses are ex- Federal Reserve Banks and the Board of Gov- pected to be held significantly below the rate ernors in 1978 and their operating plans for 1979 of inflation. I can assure you, however, that the indicate continued improvement in efficiency. system firmly intends to maintain the high qual- While the volumes of existing services are ex- ity of services it provides to the public. Statement by G. William Miller, Chairman, 1/2 percentage point to just under 6 percent at Board of Governors of the Federal Reserve the end of the year. System, before the Joint Economic Committee The further expansion in economic activity of the U.S. Congress, January 30, 1979. last year appreciably reduced the margin of unutilized resources in the economy. Skilled Mr. Chairman, members of the Joint Economic workers were in increasingly short supply, and Committee, I appreciate the opportunity to par- industrial capacity utilization rates moved closer ticipate on behalf of the Federal Reserve Board to peaks reached in recent cycles. In these in your annual hearings on the state of the circumstances, the moderation in economic economy. We find ourselves at an important growth last year was a desirable development juncture in our nation's economic progress, a since a more rapid rate of expansion in aggretime when patience and persistence are needed gate demand could well have exacerbated our until the nation's anti-inflationary economic already serious inflationary problems. policies begin to achieve significant results. The general level of prices rose sharply in The current expansion in economic activity 1978, with the rate of inflation accelerating to has now almost completed its fourth year—an about 83A percent compared with 6V2 percent impressive performance by historical standards. in 1977. While the moderation in the pace of The rate of economic growth moderated some- economic expansion and the lack of significant what in the past year, yet employment gains distortions in major sectors of the economy were exceptionally large, and major imbalances augur well for the economy's further expansion generally associated in the past with a maturing in the months immediately ahead, the longer-run business expansion did not materialize. There performance of the economy will depend critiwere, however, a number of disturbing devel- cally on our success in bringing down the rate opments. In particular, the rate of inflation, of inflation. already far too high, accelerated further; the Containment of inflationary pressures in our foreign exchange value of the dollar declined domestic economy is also a major prerequisite substantially prior to November; and the level for strengthening the dollar in foreign exchange of consumer debt rose sharply. markets while reducing our trade deficit. In 1978 Outlays for business fixed investment grew the deficit was about $35 billion, on an internastrongly in 1978, and housing activity remained tional accounts basis, and the value of the dollar at a high level through the end of the year. against major foreign currencies fell 17 percent Consumer spending, buttressed by further large over the first 10 months of the year. Since increases in consumer credit, continued to pro- November 1, when new domestic monetary vide support for the expansion. Total employ- policy actions and dollar support measures were ment rose by more than 3 million persons during initiated, the dollar has risen about 7 percent. the year; although the labor force also increased The vigorous implementation of the support rapidly, the unemployment rate declined about program through cooperative exchange market Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

128 Federal Reserve Bulletin • February 1979 intervention has been successful. The expansion deficit further—to $29 billion, by far the lowest of Federal Reserve swap arrangements and the level in six years. There seems to be widespread marshalling of other resources have proved very support for this initiative, and the prospects useful in correcting the excessive decline of the favor a further move toward budgetary balance dollar. However, the longer-run strength of the in fiscal 1981 and actual balance by fiscal 1982, dollar will depend on reducing our domestic if not before. inflation, increasing our exports, and curbing A second policy initiative in the fight against our oil imports. inflation was the administration's introduction Another worrisome aspect of our economy's on October 24 of a broad-based program calling performance has been our lagging rate of pro- for voluntary moderation in wage and price ductivity growth. The poor performance of pro- actions, the establishment of specific standards ductivity has retarded the rise in living standards for wage and price increases, and the offer of and aggravated the problem of inflation. There various incentives for compliance. Past experiare many causes of this retarded growth, some ence has suggested that incomes policies are of of which hopefully reflect temporary develop- limited effectiveness in reducing the underlying ments, but tax policies that pay insufficient rate of inflation. Yet, an incomes policy can play attention to investment incentives and govern- an important role in circumstances where more ment over-regulation must rank high among the basic economic policies are being redirected in contributing factors. a vigorous way toward the containment of in- In domestic financial markets, conditions flation. I am confident that most business and have tightened considerably over the past year. labor leaders will abide by the spirit of an Since the beginning of 1978, short-term interest incomes policy if they perceive that the adminrates have increased 3 to 4 percentage points; istration, the Congress, and the Federal Reserve mortgage rates, about IV2 percentage points; are truly determined to bring inflation under and bond yields, about 1 percentage point. control. Despite higher interest rates, funds for credit- Monetary policy also moved toward increased worthy borrowers have remained in ample sup- restraint in the past year as the Federal Reserve ply. The total volume of net funds raised in sought to foster financial conditions that would credit markets was lower in the second half of contribute to a reduction of inflationary pres- 1978 than in the first half, but total credit flows sures while supporting continued moderate ecoremained large as borrowing by households in nomic growth. Accelerating inflationary presthe form of mortgages and installment credit sures were accompanied by rising demands for continued to expand at a rapid rate. money and a tendency for the monetary aggre- The acceleration of inflation over the past year gates to expand at rates that were widely viewed has required major adjustments in economic as excessive. In the circumstances, open market policies. In the fiscal policy sphere there has operations became progressively less accombeen a dramatic movement toward tighter con- modative in the provision of reserves, and the trol over government spending and a related federal funds rate rose from around 6V2 percent reduction in current and prospective federal in early January to about 10 percent recently. deficits. The deficit specified for fiscal 1979 in The discount rate was increased in a number the First Concurrent Budget Resolution was $60 of steps by 3L/Z percentage points during 1978, billion, but this was cut to $39 billion in the to 9Vi percent. These anti-inflation moves fea- Second Resolution. This very impressive re- tured actions taken on November 1 in conjuncduction was a result of highly commendable tion with the dollar-support program: the system actions by the President and the Congress that announced an increase of 1 percentage point in cut contemplated expenditures and moderated the discount rate, imposed a supplementary reproposed tax reductions incorporated in the serve requirement of 2 percentage points on original financial plan for the year. More re- large-denomination time deposits, and further cently, President Carter has announced a budget tightened reserve availability through its open for fiscal 1980 that would reduce the yearly market operations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 129 Growth in the narrowly defined money stock, accompanied by the severe strains and distor- M-l, slowed sharply in the final quarter of 1978. tions associated with past periods of credit re- The cumulative impact of rising short-term in- straint. Current interest rate levels may be inhiterest rates has undoubtedly helped to restrain biting some potential borrowers, which is the the growth of money. But recently the public objective of credit restraint, but creditworthy has shown a tendency to economize more than borrowers continue to find funds available at might have been expected on their holdings of prevailing rate levels. The housing market in cash balances. Persistent high levels of short- particular has continued to attract a relatively term rates and the availability of alternative abundant share of financing, though at rising transactions-type accounts, such as the new interest rates. A key factor in this development savings accounts with an automatic transfer was the introduction in June 1978 of new sixfeature, have probably caused many depositors month money market certificates that have enato shift sizable amounts of funds out of demand bled depositary institutions to attract funds by deposits. Expansion in the broader measures of paying prevailing market interest rates. In addimoney, M-2 and M-3, also moderated late in tion, housing has been supported by the lending the year, reflecting not only the sluggish per- activities of the Federal Home Loan Banks, the formance of their M-l component but also the emergence of new mortgage-related securities, weakness in time and savings accounts subject and the improvement of secondary markets for to fixed-rate ceilings. Rising yields on compet- mortgages. The net increase in mortgage debt ing market instruments tended to make such in the fourth quarter of 1978 was only a little accounts increasingly less attractive as the year below the record increase in the fourth quarter progressed. In contrast, time deposits paying of 1977. interest rates competitive with those on market Mr. Chairman, you have asked me to assess instruments have continued to attract sizable the economic outlook. The major threat to the inflows of funds to banks and nonbank thrift economy is inflation and the concomitant exinstitutions. pectations that dominate the setting of prices and The tightening of financial conditions has wages. Thus, any weakening in our anti-inflabeen accompanied by erosion of liquidity posi- tionary resolve could seriously damage our dotions in various sectors of the economy. Mort- mestic economy and have adverse implications gage and consumer debt burdens rose sharply for the external value of the dollar. in 1978 and the ratio of mortgage and consumer Policies of fiscal and monetary restraint— debt repayments to disposable income reached together with the cooperation of business and a record high. Borrowing by nonfinancial cor- labor in the administration's wage-price proporations was concentrated heavily in short- and gram—can achieve a gradual reduction in the intermediate-term liabilities, especially bank rate of inflation, with progress becoming evident loans and commercial paper, and the ratio of during 1979. While growth of output and emshort- to long-term business debt is now only ployment is expected to slow this year, a recesslightly below the 1974 peak. Commercial sion is unlikely in the absence of outside disbanks have reduced their holdings of U.S. gov- turbances to the economy. A moderate rate of ernment securities and increased their use of economic growth is likely to avoid financial and interest-sensitive liabilities such as large-de- economic dislocations, such as overinvestment nomination CDs and security repurchase agree- in business inventories, which in turn could ments. Savings and loan associations have bor- foster a recession later. The economy is already rowed a record amount from Federal Home quite close to full employment and any new Loan Banks. The reduced liquidity of many surge in demand must be prevented since it individuals, business concerns, and financial would only be translated into more inflationary institutions is likely to exert a moderating influ- pressures. ence on credit-financed expenditures. Spending by consumers, a mainstay of our It should be emphasized that the much needed economic expansion since the spring of 1975, firming in credit market conditions has not been will probably continue to grow but at a reduced Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

130 Federal Reserve Bulletin • February 1979 pace in light of the increased consumer debt ally moved into the ranges set by the Federal burdens noted earlier. Expenditures on new Open Market Committee.1 The Federal Reserve plant and equipment by businessmen seem is determined to achieve a rate of monetary likely to be well maintained and they may even growth that is consistent with the objective of increase more than is currently anticipated if fostering a decline in the rate of inflation while visible progress is perceived in the fight against encouraging moderate economic expansion. The inflation. In the housing area, some decline from Federal Reserve's task will be eased immensely the current high level of activity seems probable if fiscal policy remains on the course outlined as financial restraints exert a retarding influence by the President. Large budget deficits tend to on both builders and homebuyers. Nonetheless, put upward pressure on interest rates as governthe severely depressed conditions that have pe- ment demands compete with private demands riodically affected this sector of the economy for funds. It is therefore essential for the Conwill most likely be avoided. Adequate financing gress to resist programs that lead to increased for homes will continue to be available, thanks expenditures. A reduced federal deficit, includto the wide range of government support pro- ing borrowings by off-budget agencies, would grams and the access of lending institutions to ease pressures on interest rates and allow the market sources of funds such as the new six- Federal Reserve to achieve its monetary growth month certificates. Prospects for our trade bal- objectives at lower interest rates than otherwise. ance in 1979 also seem to be brightening. A reduced budgetary deficit would also foster In your letter inviting me to these hearings, a financial environment that encourages greater Senator Bentsen, you have asked for comments business investment and would improve the on the appropriate mix of fiscal and monetary prospects for a period of sustained economic policies. In the area of monetary policy, the growth and a moderate rate of inflation. • restraint that has been put in place is achieving welcome results in the form of a reduced rate 1 The attachments to this statement are available on request from Publications Services, Division of Support of monetary expansion. As may be seen from Services, Board of Governors of the Federal Reserve the charts, the monetary aggregates have gener- System, Washington, D.C. 20551. Statement by Nancy H. Teeters, Member, is Title XI of the Financial Institutions Regula- Board of Governors of the Federal Reserve tory and Interest Rate Control Act of 1978. System, before the Committee on Banking, Section 1104(d) of that law requires all institu- Housing and Urban Affairs, U.S. Senate, Feb- tions subject to the act to notify promptly all ruary 2, 1979. customers of their rights under the law, and directs the board to prepare a model statement It is a pleasure for me to appear before this of customer rights. Although the board does not committee to testify on the important subject have rulewriting authority under this law, we of truth in lending simplification. Since I have have been asked to provide guidance as to the been appointed to chair the committee of the meaning of this notification requirement. Board of Governors of the Federal Reserve The act makes no distinction between active System that has responsibility for consumer accounts and inactive and closed accounts. affairs, I look forward to working with you on Thus, it appears that all accounts must receive this and other matters, and I anticipate a coop- the statement of customer rights. Not only erative and constructive relationship. would this notification requirement be extremely Before addressing the principal topic of this costly and burdensome, but a typical family hearing, I would like to draw attention to a would receive several identical statements. A problem that has arisen regarding the recently Senate bill, S. 37, introduced by Chairman enacted Right to Financial Privacy Act, which Proxmire, would repeal section 1 104(d). The Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 131 board's Consumer Advisory Council did not In addition to considering simplification of urge repeal of this section but adopted a resolu- truth in lending during the last session, this tion recommending that the statute be amended committee favorably reported a bill to regulate to require the statement to be delivered only at the consumer aspects of electronic funds the time access is sought to a customer's rec- transfers. Many of the committee's recomords. The board has endorsed that recom- mendations were ultimately enacted as Title XX mendation. In so doing, the board was in- of the Financial Institutions Regulatory and Influenced by the fact that this amendment would terest Rate Control Act of 1978. The portions get the information into the hands of customers of the act dealing with limitations on a conat the time they need it. sumer's liability for unauthorized transfers and Turning now to simplification of truth in for limitations on unsolicited distribution of lending, the board continues to believe in the electronic funds transfer cards go into effect this soundness of the basic concepts of S. 2802, month. The rest of the act goes into effect in which was passed by the Senate last session. May 1980. The board supports enactment of S. 108 intro- The board has begun the process of writing duced by Chairman Proxmire. Common sense regulations to implement the act. In the course indicates that the act and, I should add, the of this process, we have become concerned that regulation can and should be improved and consumers will encounter unnecessary difficulty simplified so that they will be more effective in understanding the rules provided by the new and less burdensome. act and confuse them with the provisions of the The basic cost information most needed by Truth in Lending and Fair Credit Billing Acts, consumers in shopping for credit should be which govern credit-card and overdraft-type emphasized, that is, the annual percentage rate, credit. the total finance charge, and the payments Consumers will be particularly confused in schedule. Significant information that is less cases when a single card will perform functions important for shopping purposes should be subject to the Fair Credit Billing Act (such as summarized, but with the details left to the a credit purchase) and others subject to the contract. Information that detracts from basic Electronic Fund Transfer Act (for example, a information should appear elsewhere with a cash withdrawal from an electronic terminal). reference to its availability. In some cases, a single transaction may be The 1977 Consumer Credit Survey, which subject to both acts; for example, a cash withwas funded by the Federal Deposit Insurance drawal from a terminal may debit the customer's Corporation, the Comptroller of the Currency, checking account and access a line of credit at and the Federal Reserve Board and conducted the same time. Even without these complex by the University of Michigan's Survey Re- plans, consumers should not have to learn difsearch Center, reinforces the approach taken by ferent rules for the pieces of plastic lying side- S. 2802. The survey asked consumers what by-side in their wallets. In order to minimize credit terms they would want to know when consumer confusion, the board recommends that financing a car. The overwhelming majority the acts be amended to provide one set of rules responded that the annual percentage rate was governing both credit and electronic funds the most important. At another point in the transfer transactions except when compelling interview, respondents were given a list of the policy considerations dictate different treatment. seven disclosures provided for in S. 2802 and These recommendations are based upon the aswere asked to rank their importance. The results sumption that consumers will be best served by show annual percentage rate, size of monthly one set of rules, which in time they will learn payment, and finance charge to be far more and use. important to consumers than other terms. In The board's specific recommendations are as summary, the board believes that last session's follows: simplification bill provides an excellent basis for 1. The Truth in Lending Act imposes a $50 the continued consideration of the simplification limit on the liability of a credit-card holder when of truth in lending. a card is lost or stolen. The Electronic Fund Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

132 Federal Reserve Bulletin • February 1979 Transfer Act has a $50, $500, and unlimited of the error within 10 days or a written explaliability structure. The board recommends that nation of why the creditor believes no error there be a single set of rules governing liability occurred. In the alternative, require a written for unauthorized use. The $50 limit of truth in notice that amounts in dispute need not be paid. lending is not sacred, and the concept of elec- The current time limits for resolving disputes tronic funds transfer that culpable consumers are 45 days under the Electronic Fund Transfer should carry a heavier responsibility has appeal. Act and two billing cycles but not more than Nonetheless, the approach of truth in lending 90 days under the Fair Credit Billing Act. The is more protective of consumers and, we be- board recommends that the Electronic Fund lieve, will make electronic payment systems Transfer Act be amended to conform to the Fair more acceptable to the public. Based upon the Credit Billing Act so that both laws would experience of credit-card issuers, who often do require resolution within 90 calendar days. not impose even the $50 liability for credit-card Lengthening the Electronic Fund Transfer Act loss, electronic funds transfer suppliers should limit will not hurt consumers because their funds not be materially harmed by this amendment. will have already been provisionally recredited. 2. Under the Fair Credit Billing Act, a con- 4. The board recommends that the annual sumer must write to the creditor in order to take notice of rights under the Electronic Fund advantage of the dispute resolution rules of the Transfer Act and the semiannual notice of rights act. The Electronic Fund Transfer Act permits under the Fair Credit Billing Act be eliminated. oral notice to the institution, although written In their stead, we recommend that periodic confirmation can be required of the consumer. statements contain a summary notice disclosing An informal board study indicates that less than the existence of the rights and informing persons 1 percent of consumers with questions about how to obtain a complete explanation. Since it their bills follow the formal procedures of the is normally information on periodic statements Fair Credit Billing Act. Consumers usually that triggers a dispute, we believe that contelephone, and the lack of formality should not sumers are better served by a short notice at remove them from the protections of the act. the time a dispute arises than they are by a The board recommends that the Fair Credit lengthy explanation once or twice a year. Billing Act be amended to incorporate the oral 5. The Truth in Lending Act prohibits the notice provision of the Electronic Fund Transfer unsolicited issuance of credit cards, while the Act. Electronic Fund Transfer Act permits the unso- 3. When an error is alleged under the Elec- licited issuance of cards provided they are not tronic Fund Transfer Act, the institution must validated. Because many institutions are offerwithin 10 days either complete its investigation ing cards with both credit and electronic funds or provisionally recredit the consumer's ac- transfer features, the more competitive approach count. When an error allegation is received of the Electronic Fund Transfer Act may be under the Fair Credit Billing Act, the creditor frustrated by the absolute prohibition on unsolimust either resolve the dispute or send an ac- cited issuance by the Truth in Lending Act. One knowledgment within 30 days. The board rec- solution is to conform the Truth in Lending Act ommends that both acts be amended to provide to the Electronic Fund Transfer Act to permit parallel timing requirements as follows: the unsolicited issuance of unvalidated credit a. Under the Electronic Fund Transfer cards. Act, require notice within 10 days informing 6. Both the Electronic Fund Transfer Act and the consumer of the correction or, if the insti- the Fair Credit Billing Act provide for "error" tution believes no error occurred, a written resolution procedures. The acts define mere reexplanation of the basis for that belief. In the quests for clarification or documentation as alternative, require a written notice of the pro- "errors." The board recommends that the error visional recredit. definitions be amended to limit the concept to b. Under the Fair Credit Billing Act, re- cases in which the consumer suspects a mistake quire notice to the consumer of the correction or discrepancy. Institutions should not be put Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 133 to the expense of complying with the error charges. While Regulation Z prohibits these resolution procedures each time a consumer charges when a customer's allegation of error calls for information for business, tax, or other proves correct, we believe that permitting these purposes. The board already has the authority charges at all serves to discourage customers to define additional errors by regulation and from exercising their right to assert errors. therefore can prevent any loopholes from de- These seven recommendations and a few veloping. technical problems the board's staff has discov- 7. Finally, the staff has received a number ered in dealing with matters such as rulewriting of inquiries from consumers and creditors ask- authority could be included in the present bill ing whether the Fair Credit Billing Act permits or in a separate bill. In either case, the board creditors to impose charges for providing docu- believes it is important that the legal relationship mentation or investigating errors. In some cases, between electronic funds transfers and the credit these charges appear to be quite substantial, and transactions be clarified and that the consumer in others they are open ended; for example, $5 be offered a rational, common-sense frameper hour for an investigation. The board work. recommends that both the Fair Credit Billing I appreciate the opportunity to appear. The Act and the Electronic Fund Transfer Act be board commends this committee for its tenacity amended to prohibit the imposition of such in dealing with this difficult subject. • Statement by Henry C. Wallich, Member, of inflation moved up from 6V2 percent during Board of Governors of the Federal Reserve 1977 to %lA percent last year. System, before the Committee on Banking, The acceleration of inflation occurred while Housing and Urban Affairs, U.S. Senate, Feb- product and labor markets were tightening. By ruary 8, 1979. the end of the year, the economy was operating at rates of capital and labor utilization that, Mr. Chairman, members of this committee, 1 although not quite as high as during the 1974 am pleased to present the views of the Board price surge, were nevertheless substantial. An of Governors of the Federal Reserve System on intensification of cost pressures, accompanied extending the Council on Wage and Price Sta- by incipient excess demand, was the principal bility for two years. The council can play an source of inflation in the past year. important role in the fight against inflation, and The sharp rise in production costs was the the board supports extending the authority of result of a combination of rapidly rising labor the council to 1981. compensation and dismal productivity perform- In the past year inflation has worsened con- ance. Hourly compensation rose at a 93A percent siderably, and remains the nation's major eco- annual rate during 1978—more than 2 percentnomic problem. Over the four quarters of 1978, age points faster than in 1977. A good deal of most general price measures rose about 9 per- the acceleration from 1977 to 1978—perhaps cent—substantially faster than the 6V2 percent about half—can be attributed directly to federrate in 1977. To some extent the acceleration ally mandated increases in minimum wages and of inflation last year reflected a sharp run-up in in social insurance taxes. Weak productivity farm prices, which are particularly vulnerable growth exacerbated cost pressures, and as a to temporary disturbances. A more troubling result, unit labor costs accelerated sharply to a longer-run development in 1978, however, was 9 percent rate during 1978 from just over 6 the upward trend in prices that are more closely percent a year earlier. associated with movements in production costs. Such rapid acceleration in costs, being trans- When food and energy prices are excluded from mitted to prices, often leads to further accelerthe gross business product deflator, this measure ation of costs including wage demands. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

134 Federal Reserve Bulletin • February 1979 Throughout the 1970s this chronic cycle of wage posed by the President last October can make and price increases has been curtailed just an important contribution to unwinding the briefly by downturns in activity, only to worsen wage-price cycle. again when the economy heated up. One im- The program of voluntary wage and price portant contributing factor in the spiral has been guidelines set by the President is a direct attempt the sluggish performance of productivity in re- not only to halt the upward spiral of costs and cent years. prices but also to reduce the rates of increases Over time, mechanisms have been developed in wages and prices significantly from current in the labor market—either formally or infor- rates. In this regard, the guidelines are based mally—to ensure that wages kept pace with on sound economic logic. They allow labor increases in the cost of living. As long as growth compensation to rise IV2 percent—7 percent for in labor productivity matched demands for private payments plus 1/2 percent for federal higher wages, real income continued to grow payroll taxes. Assuming trend productivity without generating significant upward pressure growth of about 1 V2 percent, unit labor costs—a on prices. In the 1970s, however, productivity major factor in price determination from year increases faltered, and it now appears that, at to year—could drop, under the guidelines, to least in the near term, the trend rate of produc- about 6 percent. If prices slowed down, followtivity growth is likely to be only about half the ing the guidelines, and if cost pressures diminnearly 3 percent trend over the two preceding ished, real income gains would continue to be decades. realized but at a significantly lower rate of The recent low rate of productivity growth inflation. adds a more serious dimension to our inflation Favoring the prospects of the wage-price reproblem. Demands for the type of real income straint program is the fact that it has been gains achieved a decade ago are inconsistent undertaken in the face of an expected slowing with current productivity trends. Pressures to of economic activity. Previous attempts to inachieve unrealistically large increases in real stitute incomes policies, such as the Kenincomes in the face of slow productivity growth nedy-Johnson guideposts, were rendered inefthreaten to result in an escalation of inflation. fective by a worsening of demand pressures. Moreover, even if real-wage demands are Business and labor leaders can be expected brought into line with productivity, inflation will voluntarily to adopt moderation in setting wages not automatically diminish. Forceful efforts ad- and prices only if they are persuaded that the ditionally must be made to break into the vicious Federal Reserve, the President, and the Concircle in which prices determine wages and gress have committed monetary and fiscal poliwages determine prices. cies to containing inflation. The main burden of the anti-inflation battle The Council on Wage and Price Stability has has fallen, and probably must continue to fall, been given the task by the President to impleon the monetary and fiscal authorities. The ap- ment the voluntary guidelines program. This propriate goal of monetary and fiscal policy in implementation has two parts: (1) translating the the coming year is to moderate the pace of President's broad request for wage and price current economic growth in order to alleviate moderation into a set of specific standards and the inflationary pressures brought on by strains regulations and (2) monitoring actual setting of on the nation's productive capacity. Recog- wages and prices in order to determine how nizing this, the Federal Reserve has moved in firms and employee groups meet the standards. the direction of monetary restraint, and the It is desirable that a single organization perform President has recommended a tighter rein on both tasks. This allows the knowledge gained government spending. It is highly desirable not in establishing standards for a vast array of to place the entire burden of the fight against industrial pricing and labor-management arinflation on demand management. As our polirangements to be applied to fair and timely cies of restraint ease pressures from the demand determinations of compliance. side, an incomes policy such as the one pro- In addition, the council has the responsibility Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 135 to notify the public of its findings; this is an sively ignore costs and also of encouraging important function since the weight of public competition when regulation has weakened it. opinion can be a critical tool in building support Finally, I would like to comment briefly on for compliance with the program. These exten- the real-wage insurance program that the Presisive tasks now are being performed by a staff dent has proposed in conjunction with the of just over 100, and the President has proposed guidelines program. Its purpose is to strengthen that the number be expanded to about 230. This the guidelines program by encouraging acceptincrease, it seems fair to say, does not pose the ance of the 7 percent wage standard. It would threat of an unwieldly bureaucracy. do this by reducing the prospect of erosion of Aside from the day-to-day task of adminis- real incomes if actual inflation were to exceed tering the guidelines program, the council has 7 percent. Participating wage earners would an opportunity to gain insights into the complex receive a tax rebate of up to $600. machinery of wage and price determination. As This form of tax-oriented incomes policy the council's work proceeds, it will be able to should be more cost-effective when rising labor identify sectors of the private economy that costs are the principal source of inflation. In require special attention. One example to date such a situation, broad compliance with wage has been the council's several reports on hospi- and price guidelines would hold down the rate tal charges and physicians' fees. Medical care of inflation. That would keep the cost of realcosts have been a significant factor in exacer- wage insurance moderate. Unpredictable inbating inflation for more than a decade. creases in prices, such as food or energy, could The council is charged as well with examin- raise inflation rates even in the presence of wage ing inflationary pressures that emanate from restraint. In such a case, the cost of the program government activities. In recent years we have might mount excessively. Limits, therefore, become increasingly aware that many govern- have been proposed on the extent of compensament regulations that contribute to desirable tion provided by the program in order to control social goals also may involve hidden costs, the risk to the federal government of adding particularly in the form of higher prices. The substantially to the deficit. Although a real-wage council has the important function of injecting tax incentive may be difficult to design, it decost-consciousness into environmental, safety, serves serious consideration as one part of a and other standards that frequently and exten- broadly based anti-inflation effort. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

137 Announcements STATEMENT OF POLICY REGARDING discuss reasons for the action and the board's reasons for accepting or rejecting suggestions re- EXPANDED RULEMAKING PROCEDURE ceived from the public. The Federal Reserve Board on January 15, Board publication of a descriptive semiannual 1979, issued a policy statement expanding its agenda of regulations under development or review, and of the status of regulatory development rulemaking procedures to improve the quality projects already announced. and public understanding of its regulations. Board review of each of its regulations at least The principal elements of the procedures that once each five years. the board will follow, with some exceptions, When delays occasioned by the new, lengthin developing new or revised Federal Reserve ier rulemaking procedures would not be necesregulations include the following: sary or in the public interest, the board will Early involvement of the public, by such means adopt expedited procedures. Section 1 of the as advance notice of rulemaking; identification of policy statement provides a number of examples areas in which the board would particularly like comment; open conferences or informal public of regulatory actions for which expedited prohearings; and direct solicitation of the views of cedures are appropriate. interested persons or groups, with attention given The new procedures do not apply to the to getting views from differing sources. formulation of monetary policy or to amend- Early involvement of designated members of the ments of regulations required to implement board. monetary policy decisions of the Board of Gov- Staff preparation of a regulatory analysis, prior ernors or the Federal Open Market Committee. to proposals for rulemaking, that will describe the need for and purposes of a new or revised regulation; examine available alternative courses of ac- FOMC MINUTES tion; estimate the possible economic impact and the burdens of compliance, recordkeeping, and The Federal Open Market Committee anreporting that would be involved, and indicate the reasons for the particular course of action selected. nounced on January 18, 1979, that minutes of discussions and actions at its meetings during Staff presentation of a regulatory proposal to the board only after the designated board members are 1973 are now available for public inspection and satisfied that the issues have been adequately conare being transferred to the National Archives. sidered at the staff level, that the proposal is understandable, and that it will impose no unnec- These minutes are contained in approximately essary burdens. 1,384 pages of typed material. Their transfer Board consideration of regulatory proposals, has been arranged with the understanding that ordinarily, at meetings open to public observation. the National Archives will make them available Allowance of at least 60 days for public com- for inspection by interested persons under its ment. usual rules and procedures. Similar records for Staff analysis of comment received and presen- earlier years are already available at the National tation of the analysis to designated board mem- Archives on the same basis. bers. The board will consider a proposal for action Copies of the minutes for 1973 will also be only after the designated board members are satismade available later for inspection at the board's fied that public comment has received full consideration. offices in Washington and at each Federal Reserve Bank and Branch, the same procedure Final board action, ordinarily at an open meeting. The board's announcement of its action will followed for earlier records. Meanwhile, a work Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

138 Federal Reserve Bulletin • February 1979 copy is now available for inspection at the tional-advisory service that the Federal Reserve board's offices, and another at the Federal Re- Banks have been operating during the past two serve Bank of New York. years. This involves visits by Federal Reserve The National Archives will furnish microfilm examiners, at the request of a member bank, copies of the minutes for a fee. The minutes to educate the bank's personnel in consumer through 1972 are now available in this form, credit protection laws and regulations and in the and those for 1973 will be available later. responsibilities of banks under civil rights laws. Release of the minutes since 1962 has pre- From April 1977 through June 1978 personnel sented special problems involving international from Federal Reserve Banks conducted 1,224 financial relationships. A number of passages educational-advisory service visits to member have been deleted from the minutes for 1962 banks. 4'This service presents the System with through 1973, with a footnote in each case a unique opportunity and means by which to indicating the general nature or subject of the enhance its effectiveness in the area of consumer deleted matter. credit and civil rights," the board said. The Reserve Banks reported that the service was well received and was regarded as a valuable CONSUMER AFFAIRS AND CIVIL means of instruction and as an effective tool to RIGHTS COMPLIANCE PROGRAM help banks help themselves to comply with their The Federal Reserve Board on February 8, consumer credit protection and civil rights re- 1979, announced an expanded and strengthened sponsibilities. program to improve compliance by member Other main elements of the Federal Reserve banks with consumer protection laws and regu- compliance program are: lations for which the Congress has assigned 1. Specialized consumer affairs and civil responsibilities to the board. rights compliance examinations by specially In March 1977 the board adopted an experi- trained examiners. mental, nationwide program of this kind. The 2. Dissemination of a compliance handbook program the board has now adopted, on a per- intended particularly for the education of banks manent basis, builds on what has been learned and for the use of examiners, but to be generally over the two years of operation of the previous available. This will delineate the consumer laws compliance program; provides for additional and regulations to be complied with, describe staff resources, particularly in specialized con- examination and investigative procedures, and sumer law bank examination; and gives added give instructions to examiners on how to proweight to civil rights compliance by banks. ceed in initiating corrective action. In issuing its consumer affairs and civil rights 3. Adjustment of the frequency of special compliance program the board said: consumer affairs and civil rights examinations, so that state member banks with the highest The Board believes that any type of discrimination prohibited by the civil rights laws is detri- ratings are examined less frequently and banks mental to the nation and to society. The Board with lower ratings receive compliance examinais convinced that such discriminatory practices by tions more frequently. banks are not only illegal but are not in the best interests of the banks, the communities they serve, 4. Continued development of an expert staff or the individuals residing in those communities. of Federal Reserve bank examiners, specializing The Board will investigate thoroughly each comin consumer affairs and civil rights law, trained plaint of discrimination it receives regarding a State member bank as well as any indication of mainly in schools conducted by the board. noncompliance revealed during an examination of 5. Strengthened and specialized arrangea State member bank. In any instance of unlawful ments for handling complaints, with emphasis discrimination, the bank will be accountable for on investigative follow-up to complaints of a appropriate remedies and penalties as provided for in the applicable laws and will be required to take serious nature, such as those alleging unlawful prompt action to correct the violation. discrimination in the extension of credit. As a key part of its compliance program, the 6. Operation of the compliance program board authorized continuation of the educa- through senior officials at Reserve Banks. A Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 139 compliance section of the board's Division of notify the party seeking control within three Consumer Affairs will provide information and days after its decision, giving its reason for assistance to the compliance officers of the Re- disapproval. Otherwise, unless the period is serve Banks, with the objective of providing extended as provided for in the act, the transachigh quality and uniform assistance to con- tion may be completed 61 days after a Federal sumers throughout the nation. Reserve Bank receives a substantially complete notice. The Reserve Bank will notify acquiring parties of the date of receipt of such a notice. REGULATION Y: POLICY STATEMENT To facilitate transactions, the board may issue AND REVISION notice, after consultation with state banking The Federal Reserve Board has adopted a policy authorities, that it does not intend to disapprove statement and revised its Regulation Y (Bank a proposed transaction. Holding Companies) to implement the Change In deciding whether to disapprove a change in Bank Control Act of 1978.1 in control, the board is required by the act to The new act requires persons acquiring con- consider competitive effects, the financial control of a state member bank or a bank holding dition of the person proposing the acquisition, company to file a notice 60 days in advance and the competence, experience, and integrity with the board. The board can disapprove such of that person and of the proposed new manproposed changes in control. The act becomes agement. effective March 10, 1979. The policy statement notes, further, that: Changes in control due to acquisitions by The Act defines "control" as the power—dibank holding companies and changes in control rectly or indirectly—to vote 25 percent or more of insured banks resulting from mergers, con- of any class of voting securities, or to direct solidations, or other similar transactions are not the management or policies of a bank holding covered by the act, since they are already sub- company or bank. The Board has established ject to regulatory approval under other laws. the following presumptions of control—subject Certain other exemptions from the prior notice to rebuttal: requirements of the act, including notice of Where an institution is subject to registration acquisition of control of foreign bank holding under Sec. 12 of the Securities Exchange Act of companies, are noted in the board's policy 1934, and the transaction would result in a person, or group acting in concert, having voting control statement and regulation. of 10 percent or more of any class of the institu- In view of the early effective date of the act, tion's voting stock. the board issued its regulatory revision in final Where a transaction would result in a person, form, in order to avoid disruption of transactions or group acting in concert, having 10 percent of that are in progress. any class of the voting stock of a State member bank or a bank holding company, and the acquir- However, the board invited comment on the ing person or group would be the largest shareregulation (by April 6, 1979) and said that it holder in the institution. intends to adopt any needed amendments to its The regulation issued by the board formalizes rules as soon as practicable. the principal parts of the policy statement. It The board's policy statement on the Change permits individuals to file current financial in Bank Control Act outlines general procedures statements as part of their notice (the act refor compliance and summarizes the principal quires organizations to file financial data for five provisions of the act, the exemptions, and the fiscal years). procedures to be followed by the board in car- The regulation also delegates authority to the rying out the act. Federal Reserve Banks to permit proposed ac- The policy statement said that if the board quisitions when there has been no objection, to disapproves a proposed change in control, it will extend the time (normally 60 days) the board may take to consider proposals, to determine whether notices provide all necessary informa- 1. Title VI of the Financial Institutions Regulatory and Interest Rate Control Act of 1978. tion, and to settle disputes as to whether a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

140 Federal Reserve Bulletin • February 1979 person proposing to acquire less than 25 percent adopted by the Federal Reserve, Office of the of a bank holding company or state member Comptroller of the Currency, and the Federal bank should file advance notice. Deposit Insurance Corporation in May 1978. The regulation does not exempt from notice requirements proposed acquisitions of control of REPORT ON REMOTE DISBURSEMENT foreign-based bank holding companies, most of whose assets and revenues are in the United The Federal Reserve Board on January 11, States. The board particularly requests comment 1979, made public a statement of policy conon this aspect of the regulation. cerning the practice known as remote dis- The other federal regulators of financial insti- bursement and announced a course of action tutions are preparing similar policy statements intended to discourage such abuse of the check and rules under the new act. collection system. At the same time the board sent to the Congress a status report on Federal Reserve efforts to eliminate the practice. BANK HOLDING COMPANY Remote disbursement involves arrangements RATING SYSTEM between a bank and a customer (frequently a The Federal Reserve Board on February 7, corporation) designed expressly to delay pay- 1979, adopted a system for appraising and rating ment of the customer's checks. For example, t the performance and financial condition of bank in such an arrangement, a bank customer makholding companies. ing most of its payments in Pennsylvania might The bank holding company rating system make payments by checks drawn on a bank in extends a program of intensified supervision of Oregon. Recipients of these checks may suffer bank holding companies the Federal Reserve put a delay in receiving credit in their accounts. into effect at the beginning of 1978. That pro- The board has the following principal congram includes requirements for annual on-the- cerns with respect to remote disbursement: spot inspections of most bank holding compa- 1. It can expose both the bank involved and nies with consolidated assets greater than $300 recipients of the remotely disbursed payments million as well as the application to such com- to risks of loss—that they may not be aware panies of standardized examination criteria. of—during the deliberately prolonged clearing Building on this supervisory program, the time. board adopted a system that will be used na- 2. Consumers and small businesses—who tionwide by the Federal Reserve to rate the may not be in a position to negotiate better strengths and weaknesses of parent bank holding payment terms—may be denied prompt access companies and their bank and nonbank subsidi- to funds due to them. aries and to assess operational characteristics 3. Remote disbursement could result in unsuch as the organization's earnings, the ade- safe or unsound banking practices if the cusquacy of its capital, and its management. tomer's funds at the remote disbursing bank are Each of these component aspects of the hold- not sufficient to cover the customer's checks ing company will be given a rating of one to (that is, if settlement procedures between the five, with one representing the best rating and customer and the bank are not on an "immediate five the lowest. funds" or "collected balance" basis). This The component ratings will then be combined would result in unsecured extensions of credit into an overall financial composite rating, also by the bank to the customer. Such extensions on a scale of one (best) to five (lowest). of credit might not be warranted as a matter In addition, holding companies will be given of loan policy. In the case of small banks, such a separate rating on the ability and competence loans might exceed the legal limit for lending of the company's management. to any one customer. The bank holding company rating system The board gave the following policy guidadopted by the board is similar in concept to ance: The board believes the banking industry the uniform interagency system for rating banks has a public responsibility not to design, offer, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 141 promote or otherwise encourage the use of a remotely disbursed checks, or to require final service expressly intended to delay final settle- settlement for payments within normal collecment and which exposes payment recipients to tion times including limitation on the use of greater than ordinary risks. The board is calling depository transfer checks."5 on the nation's banks to join in the effort to eliminate remote disbursement practices in- INFORMATION ABOUT tended to obtain extended float. COMMUNITY REINVESTMENT ACT There is no intention to discourage corporate disbursement arrangements with banks that pro- The four federal supervisors of financial instituvide for improved control over daily cash re- tions responsible for enforcing the Community quirements, provided that these arrangements do Reinvestment Act (CRA) on January 15, 1979, not result in the undesirable effects noted above. issued staff answers to the most frequently re- Banks should provide the cash management ceived inquiries about the act, the implementing services needed by their customers through the regulations, and related examination proceuse of payments methods that facilitate prompt dures.4 funds availability to payment recipients and that The agencies stated that the questions and protect banks from unnecessary risk. answers developed by agency staffs should not To provide incentives to banks to design and be taken as official interpretations. Their puruse payment methods that are in keeping with pose is solely to be helpful to financial instituthe public interest the board has adopted a plan tions and to the public by providing useful consisting of the following actions: background information. 1. Direct telephone or personal contacts be- An accompanying statement signed by offitween members of the Board of Governors or cials of the agencies provides financial institu- Reserve Bank Presidents and the chief execu- tions with policy guidance on the general mantives of banks and bank holding companies ner in which they should address their responbelieved to be offering remote disbursement sibilities under CRA. The agency officials said: services. To date these contacts have been very In carrying out their responsibilities under CRA, successful in obtaining voluntary bank action to financial institutions should focus on the spirit of terminate the practice. the legislation and try to avoid narrow, legalistic 2. Review by bank examiners of settlement interpretations of the legislation or the regulations. The agencies believe that the financial institutions, procedures between banks and their customers. relying on their own resources, are capable of Bank examiners have been alerted and directed complying with the requirements of the regulation. to pay particular attention to the check service The statement added that while the agencies offerings of banks to their customers. want to provide helpful information and guid- 3. Implementation of a late deposit "package ance—and will issue further questions and ansort" 2 option for check clearance at all Reserve swers in the future—they wish to keep official offices. This option is intended to make it posinterpretations of CRA regulations to a minisible for banks around the nation to accelerate mum. collection of checks drawn on remotely located The CRA became effective November 6, collection points. 1978. It is intended to encourage federally in- 4. Consideration of the need, desirability, sured commercial banks, mutual savings banks, and feasibility of regulatory or legislative moves to designate remote disbursement as an unfair 3. A preauthorized check drawn on the customer's banking and business practice, to change the account in another bank. Federal Reserve credit availability schedule for 4. The agencies are: the Federal Home Loan Bank Board (supervisor of savings and loan associations); the Comptroller of the Currency (supervisor of national 2. Package-sorted checks are checks sent to the Fed- banks); the Federal Deposit Insurance Corporation eral Reserve for collection, presorted and packaged (supervisor of state-chartered banks that are not memby the name of the banks on which the checks are bers of the Federal Reserve System and of mutual drawn. This simplifies and speeds check clearance by savings banks); the Federal Reserve Board (supervisor the Federal Reserve. of state-chartered member banks). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

142 Federal Reserve Bulletin • February 1979 and savings and loan associations to help meet 2. Money stock seasonal factors, 1979 the credit needs of their entire communities, including low- and moderate-income neighbor- Time deposits other than CDs Certifihoods, while preserving the flexibility needed Demand cates by financial institutions to operate safely and Month or week Currency deposits Member m N em on b - er dep o o f sit banks banks soundly. With respect to the staff questions and an- Monthly swers, the agencies said: .9920 1.0250 .9990 .9960 1.0060 .9870 .9790 1.0020 1.0020 .9750 Since the final regulations and examination pro- .9920 .9830 1.0070 1.0080 .9850 .9970 1.0130 1.0080 1.0060 .9750 cedures have been made public, a number of .9990 .9800 1.0080 1.0050 .9820 questions have been raised about them by financial 1.0030 .9960 1.0050 1.0030 .9950 institutions and individuals. In order to assist fi- July 1.0080 1.0040 1.0030 1.0000 .9920 nancial institutions in meeting their responsibilities 1.0030 .9890 .9980 1.0010 1.0050 .9970 .9930 .9940 .9980 1.0200 under CRA and to increase public understanding .9980 1.0000 .9940 .9970 1.0250 . . . the staffs of the agencies have prepared the 1.0070 1.0050 .9900 .9930 1.0100 1.0170 1.0320 .9920 .9910 1.0300 attached paper which presents the most common questions about the CRA regulation and examina- Weekly tion procedures and the staffs' responses. The questions and answers provide staff 1.0060 1.0760 .9959 .9917 1.0379 10 1.0060 1.0470 .9983 .9948 1.0214 guidance as to the meaning the agencies attach 17 .9960 1.0360 .9990 .9963 1.0042 24 .9850 1.0070 1.0000 .9973 .9951 to key terms in the act and their implementing 31 .9760 .9870 1.0000 .9974 .9895 regulations, such as 4'office," "local commu- Feb. 7 .9900 .9910 1.0005 .9994 .9839 14 .9920 .9840 1.0016 1.0016 .9779 nity," and "small" business or farm. They also 21 .9895 .9740 1.0025 1.0029 .9707 28 .9775 .9660 1.0029 1,0036 .9679 address such subjects as the contents of the Mar. 7 .9940 .9850 1,0050 1.0063 .9741 institutions' CRA statements that must be 14 .9960 .9880 1.0067 1.0081 .9801 21 .9920 .9820 1.0073 1.0086 .9856 prepared to comply with CRA regulations, the 28 .9840 .9690 1.0077 1.0084 .9957 availability of public comment files, and the way .9930 1.0050 1.0104 1.0094 .9951 11 1.0090 1.0180 1.0100 1.0093 .9833 institutions should deal with the delineation of 18 1.0030 1.0290 1.0075 1.0059 .9720 25 .9900 1.0070 1.0064 1.0036 .9650 low- and moderate-income neighborhoods in .9880 .9980 1.0060 1.0023 .9655 their communities. 9 1.0075 .9810 1.0072 1.0040 .9713 16 1.0020 .9860 1.0083 1.0052 .9781 23 .9960 .9710 1.0083 1.0060 .9876 30 .9930 .9730 1.0088 1.0056 .9939 MONEY STOCK REVISION 1.0050 .9950 1.0079 1.0055 .9953 13 1.0090 1.0000 1.0065 1.0049 .9951 20 1.0030 .9980 1.0036 1.0025 .9911 The money stock and related measures have 27 .9935 .9840 1.0029 1.0005 .9967 been revised to incorporate the June 1978 July 4 1.0090 1.0140 1.0042 1.0003 .9989 11 1.0190 1.0120 1.0040 1.0002 .9919 benchmark adjustments for nonmember banks 18 1.0110 1.0110 1.0028 .9997 .9892 25 1.0020 .9920 1.0026 .9999 .9903 and revised seasonal factors. .9960 .9930 1.0016 1.0002 .9935 Table 1 shows rates of change for M-l, M-2, 8 1.0120 .9950 .9998 1.0015 .9996 15 1.0080 .9960 .9982 1.0012 1.0029 and M-3 measures for 1978. Monthly and 22 1.0020 .9880 .9971 1.0009 1.0061 29 .9910 .9740 .9969 1.0006 1.0108 Sept. 5 1.0030 .9940 .9963 1.0001 1.0132 1. Comparison of old and revised money stock 12 1.0050 1.0000 .9951 .9995 1.0158 19 .9970 1.0010 .9924 .9972 1.0189 growth rates, 1978 26 .9880 .9750 .9926 .9964 1.0247 Annual rates of growth based on quarterly-average data; Oct. 1 3 0 1. . 0 9 0 91 9 0 0 1 . . 9 0 9 0 8 5 0 0 . . 9 9 9 9 4 5 6 8 . . 9 9 9 9 8 7 9 4 1 1 . . 0 0 3 2 1 9 4 3 percent 17 1.0020 1.0090 .9942 .9979 1.0250 24 .9960 .9900 .9937 .9967 1.0216 M-l M-2 M-3 31 .9870 .9950 .9919 .9944 1.0202 PPeerriioodd Old Revised Old Revised Old Revised Nov. 7 1.0050 1.0120 .9905 .9936 1.0077 14 1.0100 1.0130 .9894 .9932 1.0062 21 1.0080 1.0000 .9903 .9931 1.0105 Annual 7.2 7.3 8.0 8.5 9.1 9.4 28 1.0030 .9920 .9897 .9924 1.0140 Quarterly Ql 6.2 6.6 6.9 7.0 7.7 8.1 1.0120 1.0180 .9909 .9922 1.0176 Q2 9.9 9.2 7.9 8.4 7.8 8.4 1 1 2 9 1 1 . . 0 0 1 1 9 9 0 0 1 1 . . 0 0 3 2 0 3 0 0 . .9 9 9 9 1 2 5 3 . .9 9 9 9 0 2 5 1 1 1 . . 0 0 3 2 2 4 2 9 Q3 7.6 8.1 8.9 9.9 10.1 10.4 26 1.0260 1.0280 .9925 .9901 1.0366 Q4 4.5 4.4 7.5 7.7 9.8 9.4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 143 weekly M-l and M-2 seasonal factors for 1979 MEETING OF CONSUMER ADVISORY appear in table 2. COUNCIL Benchmark adjustments for M-l were minor, The Consumer Advisory Council met on Februraising the level of the series $100 million in ary 21 and 22, 1979, in Washington, D.C. The June 1978 and about the same amount at the meeting, which was open to the public, dealt end of the year. The benchmarking raised M-2 with proposed regulations on consumer liability about $2.0 billion in June 1978 and more than for unauthorized use of credit and debit cards, $4.0 billion at the end of 1978. truth in lending amendments connected with Seasonal revisions smoothed the quarterly electronic fund transfers, the results of a recent and monthly data. M-l growth in April was survey of banking practices, and other matters. lowered 3 percentage points and in November was raised about the same amount. Revisions The council advises the Federal Reserve for other months were smaller. The current Board on its responsibilities regarding consumer credit legislation and regulation. revision also incorporates new seasonal factors for M-2 and M-3, but the changes had little impact on growth rates for these aggregates. CHANGES IN BOARD STAFF Monthly and weekly data from 1959 to date The Board of Governors has announced the are available from the Banking Section of the temporary assignment of Edward T. Mulrenin, Board's Division of Research and Statistics. Assistant Controller, Office of the Controller, as Assistant Secretary of the Board, Office of the Secretary, effective March 1, 1979. Mr. PROPOSED ACTIONS Mulrenin replaces John M. Wallace, who has The Federal Reserve Board has proposed for returned to the Federal Reserve Bank of Atlanta. public comment a statement setting forth the The board has also announced the deaths of rights to privacy that customers of .financial Thomas J. O'Connell, Counsel to the Chairman, institutions have, under a new statute, when a Office of Board Members, and John E. Reynfederal agency seeks financial information about olds, Counselor, Division of International Fithem. The board asked for comment by Februnance. ary 16, 1979. The government agencies that supervise fed- SYSTEM MEMBERSHIP: erally insured depositary institutions have proposed regulations to carry out the new Deposi- ADMISSION OF STATE BANKS tory Institution Management Interlocks Act.5 The following banks were admitted to member- Public comment on the proposal should be reship in the Federal Reserve System during the ceived by March 5, 1979. period January 16 through February 15, 1979: The Federal Reserve Board on February 12, 1979, proposed suspension of a recent amend- Florida ment of its Regulation Z (Truth in Lending) Miami Plaza Bank of Miami concerning the "cooling off" period for con- Oregon sumers who pledge their home as security for Junction City Tri-County Banking open-end credit arrangements. The board re- Company quested comment by April 16, 1979. Texas Baytown Citizens Bank and Trust 5. The agencies are: the Federal Home Loan Bank Company of Baytown Board; the Federal Deposit Insurance Corporation; the Virginia National Credit Union Administration; the Comptroller of the Currency; and the Board of Governors of the Newport News First City Bank of Federal Reserve System. Newport News Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

145 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON DECEMBER 19, 1978 1. Domestic Policy Directive The information reviewed at this meeting suggested greater strength in economic activity than had been evident at the time of the Committee's meeting a month earlier; growth in output of goods and services in the current quarter now appeared to be somewhat faster than the annual rate of 3.4 per cent indicated for the third quarter by preliminary estimates of the Commerce Department. The rise in average prices, as measured by the fixed-weight price index for gross domestic business product, appeared to be close to the annual rate of 8.2 per cent estimated for the third quarter. Staff projections for the year ahead differed little from those prepared a month earlier. They continued to suggest a gradual slowing in the growth of economic activity as the year progressed. The rise in average prices was projected to remain rapid during 1979 and the rate of unemployment to rise marginally. In November, the index of industrial production advanced an estimated 0.7 per cent, somewhat more than the gains in the preceding 2 months but close to the average monthly increase since the beginning of the year. Nonfarm payroll employment grew substantially in November for the second consecutive month. In manufacturing also, a large increase in employment was registered for the second month in a row and the average workweek rose somewhat further. The unemployment rate was unchanged at 5.8 per cent, close to its low for the year. The dollar value of total retail sales expanded substantially in November and revised data indicated a sizable advance for October as well. Unit sales of new automobiles declined somewhat in November. Total housing starts were at an annual rate of 2.1 million units in both October and November. Sales of new and existing singlefamily houses rose to new highs in October. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 146 Federal Reserve Bulletin • February 1979 The latest Department of Commerce survey of business plans, taken in late October and November, suggested that spending for plant and equipment would expand at an annual rate of nearly 16 per cent in the current quarter but at the markedly lower rate of about 8 per cent in the first half of 1979. The survey also indicated that in 1978 as a whole fixed investment outlays would be 12.7 per cent greater than in 1977. Manufacturers' new orders for nondefense capital goods advanced sharply in October, following sizable increases in other recent months. The index of average hourly earnings of private nonfarm production workers increased at an annual rate of 8.3 per cent over the first 11 months of 1978, nearly 1 percentage point above the rise during 1977. Average producer prices of finished goods rose substantially in November for the third consecutive month despite more moderate increases in producer prices of food products than in the two earlier months. In October, the consumer price index advanced at an annual rate of 9 per cent, and the rate of increase for the year to date—about 9 ¥2 per cent—was nearly 3 percentage points above that during 1977. In foreign exchange markets the trade-weighted value of the dollar against major foreign currencies fell sharply following the OPEC announcement on December 17 of a larger-than-anticipated increase in oil prices for 1979. Over the previous few weeks the dollar had declined slightly on balance. Nevertheless, at the time of this meeting it was still about 7 per cent above its low reached just prior to the November 1 announcement of the new program to strengthen the dollar. The U.S. trade deficit in October remained close to the annual rate recorded in the second and third quarters but well below that in the previous two quarters. The growth of total.credit at U.S. commercial banks was appreciably slower in November than in September and October. However, bank loans other than security loans continued to expand rapidly. To finance this expansion banks liquidated a sizable amount of security holdings and issued a substantial volume of large-denomination time deposits. Outstanding commercial paper of nonfinancial businesses rose considerably in November for the second consecutive month. The narrowly defined money supply (M-l) declined at an annual rate of about 4V2 per cent in November. The contraction reflected, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 147 among other things, the shifts of funds from demand deposits to savings deposits associated with the introduction of the automatic transfer service (ATS) and effects of the substantial rise in shortterm market interest rates since April. Meanwhile, growth of M-2 and M-3 slackened further. Sales of 6-month money market certificates at commercial banks and nonbank thrift institutions continued strong in November, but savings deposits and time deposits subject to interest rate ceilings contracted at commercial banks. Total inflows of funds to nonbank thrift institutions slowed in November after growing rapidly in the preceding 3 months; the rate of expansion was still considerably above that in the first half of the year. Over the first 11 months of the year, M-l, M-2, and M-3 grew at annual rates of about 7LA, SLA, and 9LA per cent, respectively. At its meeting on November 21, the Committee had agreed that early in the inter-meeting period System open market operations should be directed toward attaining a weekly-average Federal funds rate of about 9% per cent, slightly above the level prevailing at that time. Subsequently, the objective for the Federal funds rate was to be raised or lowered within the range of 9%. to 10 per cent. In setting a specific objective for the funds rate, the Manager of the System Open Market Account was to be guided mainly by a range of tolerance of 6 to 9V2 per cent for the annual rate of growth in M-2 over the November-December period, provided that the rate of growth in M-l over the same period did not appear to exceed 5 per cent. Immediately following the November 21 meeting the Manager began to seek bank reserve conditions consistent with an increase in the weekly-average Federal funds rate to around 9% per cent. Incoming data during the inter-meeting period suggested initially that growth in M-2 would be well within the range specified by the Committee and that growth in M-l would be below 5 per cent. In subsequent weeks, newly available data led to progressively lower estimates of growth, and by the end of the first week in December the projections might, under normal circumstances, have called for a reduction in the objective for the Federal funds rate to 9% per cent. On December 8, however, the Committee approved a recommendation by the Chairman to instruct the Manager to continue aiming for a Federal funds rate of 97s per cent during Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 148 Federal Reserve Bulletin • February 1979 the period before the next regular meeting of the Committee, unless growth of the aggregates should appear to weaken significantly further. Most market interest rates rose further during the inter-meeting period, as financial markets seemed to react to indications of continued strength in business conditions, added evidence of intense inflationary pressures, and the OPEC announcement of a large increase in oil prices. Commercial banks raised the loan rate to prime business borrowers from 11 per cent to 11 Vi per cent during the period. In mortgage markets interest rates continued to rise. In the Committee's discussion of the economic situation and outlook, most members expressed little or no disagreement with the staff projection of a gradual slowing of the expansion during 1979 and of a slight rise in the unemployment rate. At the same time, however, the observation was made that the latest information provided contradictory indications of underlying trends in economic activity, and some members commented on the prospects for alternative courses of activity. The members continued to anticipate that average prices of goods and services would rise rapidly, and it was observed that the outlook for inflation had been worsened by the recent OPEC announcement of a substantial rise in oil prices during 1979. With respect to some of the economic information that had become available recently, it was suggested that the retail sales and employment statistics—and the apparent rate of growth in GNP in the current quarter—indicated underlying strength, while the behavior of the monetary aggregates so far in the fourth quarter could be symptomatic of current or near-term weakness in demands for goods and services. Similarly, the latest data on new orders for nondefense capital goods and on construction contract awards were strong, but according to the Commerce Department's survey of business plans, plant and equipment expenditures in the first half of 1979 would be weak. Concerning the over-all situation, it was suggested on the one hand that the current and prospective pace of growth in activity was too rapid, that output was beginning to press against the limits of capacity, and that inflationary pressures—which for a long time had been greater than generally projected—were still increasing. An alternative appraisal of the latest data was that the strength Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 149 in the current quarter, especially in consumer spending, most likely was an aberration—similar to others during the past few years—and that economic activity was remarkably well balanced for the present stage of the expansion. It was also suggested, however, that the strength in demands and activity, although possibly persisting for a quarter or two, might culminate in a recession in the second half of 1979. At its meeting in October the Committee had agreed that from the third quarter of 1978 to the third quarter of 1979 growth of M-2 and M-3 within ranges of 6V2 to 9 per cent and IV2 to 10 per cent, respectively, appeared to be consistent with broad economic aims. M-l was expected to grow over that period within a range of 2 to 6 per cent, depending in part on the speed and extent of transfers from demand to savings deposits resulting from the introduction of ATS. The associated range for the rate of growth in commercial bank credit was 8V2 to 11 !/2 per cent. The Committee had also decided that growth of M-1+ within a range of 5 to 7V2 per cent appeared to be generally consistent with the ranges of growth for the other monetary aggregates. It had been 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 subsequent meetings. In the discussion of policy for the period immediately ahead, most members of the Committee advocated some additional firming in money market conditions. A few members preferred to direct operations toward maintaining the money market conditions currently prevailing. No member recommended an easing in money market conditions per se, but one suggested that whether money market conditions were firmed or eased be determined altogether on the basis of the incoming evidence on the behavior of the monetary aggregates. Several reasons were advanced for some additional firming in money market conditions. Available economic data suggested that growth of output had not yet been slowed and that inflationary pressures remained intense. The strength of demands for bank loans and other credit seemed to provide a more reliable indication of underlying economic conditions than did the recent weakness of growth in the monetary aggregates. In any case, it was observed, weakness in monetary expansion following a long period of strong Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 150 Federal Reserve Bulletin • February 1979 growth could be accepted for a time. Some additional firming in money market conditions, moreover, would help to maintain public confidence in the program to moderate inflation and to support the foreign exchange value of the dollar. In support of the preference for maintaining prevailing money market conditions, rather than firming, it was observed that over the preceding 2 months the Committee had increased monetary restraint substantially. Because the evidence on current and prospective economic developments was conflicting, the Committee ought to pause and evaluate the effects of its recent actions before contemplating additional firming; if the unexpected shortfall in monetary expansion persisted, it might contribute to a recession. The uncertainties in the current situation also provided the grounds for the proposal to base the Committee's objective for money market conditions altogether on the incoming evidence on the behavior of the monetary aggregates: It was suggested that whether fundamental economic conditions were strong or weak would inevitably become evident in renewal of rapid monetary expansion or in continuation of sluggish expansion, leading in either case to appropriate objectives for money market conditions. At the conclusion of the discussion the Committee agreed to instruct the Manager to direct open market operations toward raising the Federal funds rate to 10 per cent or slightly higher early in the period before the next regular meeting and subsequently to maintain the rate within a range of 93A to IOV2 per cent. With regard to the objective for the rate within that range, the Committee instructed the Manager to be guided by ranges of tolerance for the annual rates of growth of M-l and M-2 of 2 to 6 per cent and 5 to 9 per cent, respectively. Thus, after a 2-month interruption, the Committee agreed to return to its practice of specifying a range rather than only an upper limit for M-l and of instructing the Manager to give approximately equal weight to the behavior of M-l and M-2 in assessing the behavior of the aggregates; it did so because recent experience had suggested that the impact of ATS on the annual rate of growth of M-l could be estimated within fairly narrow limits. However, the Committee decided that the Manager should respond more quickly to relatively high than to relatively low rates of growth in the aggregates. Specifically, the objective for the funds rate was to be raised in an orderly fashion Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 151 within its range if the 2-month growth rates of M-l and M-2 appeared to be significantly above the midpoints of the indicated ranges. On the other hand, the objective was to be lowered in an orderly fashion only if the 2-month growth rates appeared to be approaching the lower limits of the indicated ranges. The next regular meeting of the Committee was scheduled for February 6, 1979, but it was understood that a telephone conference would be held in mid-January to consider whether supplementary instructions were needed. It was also understood that the Chairman would call upon the Committee to consider the need for supplementary instructions if significant inconsistencies appeared to be developing among the Committee's objectives or if, before mid- January, the behavior of the monetary aggregates appeared to call for a reduction in the objective for the Federal funds rate toward the lower limit of its range. The following domestic policy directive was issued to the Federal Reserve Bank of New York: The information reviewed at this meeting suggests that in the current quarter real output of goods and services has picked up somewhat from the rate in the third quarter. In November, as in October, the dollar value of total retail sales expanded substantially. Industrial production and nonfarm payroll employment rose considerably further, and the unemployment rate remained at 5.8 per cent. Over recent months, broad measures of prices and the index of average hourly earnings have risen rapidly. The trade-weighted value of the dollar against major foreign currencies declined sharply following OPEC's announcement on December 17 of increased oil prices for 1979, after having declined slightly over the previous few weeks, but it remains substantially above the low reached just prior to the actions taken on November 1 to strengthen the dollar. The U.S. trade deficit in October was at about the rate recorded in the second and third quarters. M-l declined in November, only in part because of shifts of funds from demand deposits to savings deposits after the introduction of the automatic transfer service (ATS) at the beginning of the month. Over the first 11 months of 1978, M-l grew at an annual rate of about IVA per cent. Growth of M-2 and M-3 slackened further in November; they grew at rates of about 8LA and 9LA per cent, respectively, over the first 11 months of the year. Inflows of deposits to nonbank thrift institutions slowed in November, after having Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 152 Federal Reserve Bulletin • February 1979 grown rapidly in the preceding 3 months. Market interest rates in general have risen further in recent weeks. In light of the foregoing developments, it is the policy of the Federal Open Market Committee to foster monetary and financial conditions that will resist inflationary pressures while encouraging continued moderate economic expansion and contributing to a sustainable pattern of international transactions. At its meeting on October 17, 1978, in setting ranges for the monetary aggregates, the Committee recognized the uncertainties concerning the effects that the November 1 introduction of ATS would have on measures of the money supply, especially M-l. Against that background, the Committee agreed that appropriate monetary and financial conditions would be furthered by growth of M-2 and M-3 from the third quarter of 1978 to the third quarter of 1979 within ranges of 6V2 to 9 per cent and IV2 to 10 per cent, respectively. The narrowly defined money supply (M-l) was expected to grow within a range of 2 to 6 per cent over the period, depending in part on the speed and extent of transfers from demand to savings deposits resulting from the introduction of ATS. The associated range for bank credit is 8V2 to IIV2 per cent. Growth of M-1+ (M-l plus savings deposits at commercial banks and NOW accounts) in a range of 5 to IV2 per cent was thought to be generally consistent with the ranges of growth for the foregoing aggregates. These ranges are subject to reconsideration at any time as conditions warrant. In the short run, the Committee seeks to achieve bank reserve and money market conditions that are broadly consistent with the longer-run ranges for monetary aggregates cited above, while giving due regard to the program for supporting the foreign exchange value of the dollar, to developing conditions in domestic financial markets, and to uncertainties associated with the introduction of ATS. Early in the period before the next regular meeting, System open market operations are to be directed at attaining a weekly average Federal funds rate slightly above the current level. Subsequently, operations shall be directed at maintaining the weekly average Federal funds rate within the range of 93A to 10per cent. In deciding on the specific objective for the Federal funds rate the Manager shall be guided mainly by the relationship between the latest estimates of annual rates of growth in the December-January period of M-1 and M-2 and the following ranges of tolerance: 2 to 6 per cent for M-l and 5 to 9 per cent for M-2. If, giving approximately equal weight to M-l and M-2, their rates of growth appear to be significantly above the midpoints of the indicated ranges, the objective for the funds rate shall be raised in an orderly fashion within its Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 153 range; if their rates of growth appear to be approaching the lower limits of the indicated ranges, the funds rate shall be lowered in an orderly fashion within its range. If the rates of growth in the aggregates appear to be falling outside the limits of the indicated ranges at a time when the objective for the funds rate has already been moved to the corresponding limit of its range, the Manager will promptly notify the Chairman, who will then decide whether the situation calls for supplementary instructions from the Committee. Votes for this action: Messrs. Miller, Volcker, Baughman, Coldwell, Eastburn, Partee, Willes, and Winn. Votes against this action: Mrs. Teeters and Mr. Wallich. Mrs. Teeters dissented from this action because she believed that for the time being open market operations should be directed toward maintaining the money market conditions currently prevailing. In her view, the Committee should wait to evaluate the effects of the substantial firming in money market conditions of the past 2 months before contemplating any additional firming. Mr. Wallich dissented from this action because he favored a somewhat more restrictive policy posture than that adopted by the Committee. In his opinion, the underlying economic situation was still strong and the strength of demands was adding to inflationary pressures and expectations while interest rates were not high in real terms and were not exerting strong restraint. Subsequent to the meeting, on December 29, 1978, projections of growth in the monetary aggregates suggested that for the December-January period M-2 would grow at an annual rate well below the lower limit of the 5 to 9 per cent range specified by the Committee and that M-l would grow at a rate in the lower portion of its range of 2 to 6 per cent. Since the meeting of the Committee on December 19 the Manager had been aiming for a Federal funds rate of about 10 per cent or slightly above, although Federal funds had been trading at higher levels in response to exceptional demands for excess bank reserves near the end of the year. The behavior of the aggregates would have called for a reduction in the objective for the funds rate toward the 93A per cent lower limit of its specified range. However, in view of uncertainties about the interpretation of the behavior of the aggre- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 154 Federal Reserve Bulletin • February 1979 gates at this time, and against the background of domestic and international economic and market conditions, Chairman Miller recommended that the Manager be instructed to continue to aim for a Federal funds rate of 10 per cent or slightly above, pending a review of the situation in the telephone conference, tentatively planned for January 12. On December 29, 1978, the Committee modified the domestic policy directive adopted at its meeting of December 19, 1978, to call for open market operations directed at maintaining the weeklyaverage Federal funds rate at about 10 per cent or slightly above. Votes for this action: Messrs. Miller, Volcker, Baughman, Cold well, Eastburn, Partee, Mrs. Teeters, Messrs. Wallich, Willes, and Winn. Votes against this action: None. On January 12 the Committee held a telephone conference to review the situation and to consider whether supplementary instructions were needed. However, no change was made in the instruction to the Manager to continue to direct open market operations toward maintaining the weekly-average Federal funds rate at about 10 per cent or slightly above. 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 to exceed $1.0 billion, unless a larger position is expressly authorized by the Committee. On November 1, 1978, an open position of $5 billion had been authorized. At the meeting on December 19, 1978, the Committee authorized an increase in this limit to $8 billion to provide further flexibility for Federal Reserve operations in the foreign exchange markets undertaken pursuant to the Committee's foreign currency directive. Votes for this action: Messrs. Miller, Volcker, Baughman, Cold well, Eastburn, Partee, Mrs. Teeters, Messrs. Wallich, Willes, and Winn. Votes against this action: None. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of FOMC 155 Pursuant to an agreement with the Treasury under which the Federal Reserve would undertake to "warehouse" foreign currencies—that is, to make spot purchases of foreign currencies and simultaneously to make forward sales of the same currencies at the same exchange rate—the Committee had agreed on December 14, 1978, to raise the amount that the Federal Reserve would be prepared to warehouse from billion to $13A billion equivalent of such foreign currencies. That action had been taken in view of the impending receipt by the Treasury of somewhat more than $1^2 billion dollars equivalent of German marks resulting from its first issuance of securities denominated in foreign currencies as one of the measures of the broad program announced on November 1 to strengthen the dollar. At this meeting the Committee agreed to raise the amount of eligible foreign currencies that the Federal Reserve would be prepared to warehouse to $5 billion. The Committee also agreed to warehouse such currencies for periods of up to 12 months; previously the agreement had provided that half of the authorized amount would be for periods of up to 6 months and half for periods of 12 months. These actions were taken in view of additional Treasury offerings of securities denominated in foreign currencies in prospect for early 1979. Votes for these actions: Messrs. Miller, Volcker, Baughman, Cold well, Eastburn, Partee, Mrs. Teeters, Messrs. Wallich, Willes, and Winn. Votes against these actions: None. 3. Authorization for Domestic Open Market Operations On January 15, 1979, Committee members voted to increase from $3 billion to $5 billion the limit on changes between Committee meetings in System Account holdings of U.S. Government and Federal agency securities specified in paragraph 1(a) of the authorization for domestic open market operations, effective immediately, for the period ending with the close of business on February 6, 1979. Votes for this action: Messrs. Miller, Volcker, Baughman, Coldwell, Eastburn, Partee, Mrs. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 156 Federal Reserve Bulletin • February 1979 Teeters, Messrs. Wallich, Willes, and Winn. Votes against this action: None. This action was taken on recommendation of the System Account Manager. The Manager had advised that large-scale sales of securities since the December meeting—required primarily to counter the effect on member bank reserves of an unusually and unexpectedly high level of float—had reduced the leeway for further sales to about $100 million. It appeared likely that additional sales would be required because current projections indicated a need for further reserve-absorbing operations over the coming weeks. Subsequently, Committee members voted to increase the limit specified in paragraph 1(a) by an additional $1 billion, to $6 billion, effective immediately, for the period ending with the close of business on February 6, 1979. Votes for this action: Messrs. Miller, Volcker, Baughman, Coldwell, Eastburn, Partee, Mrs. Teeters, Messrs. Wallich, Willes, and Winn. Votes against this action: None. This action was taken on recommendation of the Manager. On January 26 he had advised that, despite the Committee's action on January 15 to raise the inter-meeting limit to $5 billion, the leeway available for further sales would be only about $350 million as of the close of business on January 26. Since January 15, required reserves had been weaker than had been expected, and a decline of currency in circulation had provided reserves while float had remained high. Records of policy actions taken by the Federal Open Market Committee at each meeting, in the form in which they will appear in the Board's Annual Report, are released about a month after the meeting and are subsequently published in the BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

157 Law Department Statutes, regulations, interpretations, and decisions AMENDMENTS TO REGULATION Y AND deposits held or controlled by it on the date on RULES REGARDING DELEGATION which it became, or is to become, a bank holding OF AUTHORITY company, or such Reserve Bank as the Board may designate. With respect to notices filed and other The Board of Governors has adopted amend- actions taken under the Control Act, the term ments to its Regulation Y and its Rules Regarding refers to the Federal Reserve Bank for institution Delegation of Authority to implement the change to be acquired, as determined by the preceding in the Bank Control Act of 1978 and to establish sentence in the case of bank holding companies certain exemptions and procedures. and by section 9 of the Federal Reserve Act in the case of State member banks. 1. Effective March 10, 1979, the title to Regulation Y is revised to read 4'Part 225—Bank 2. Effective March 10, 1979, Regulation Y is Holding Companies and Change in Bank Control" amended by adding a new section, § 225.7, as and section 225.1 of that Part is revised to read follows: as follows: Section 225.7—Change in Bank Control Section 225.1— (a) Acquisitions of Control.14 Under the Con- Authority, Scope, and Definitions trol Act, acquisitions by a person or persons acting in concert of the power to vote 25 per cent or (a) Authority and scope. This Part is issued by more of a class of voting securities of a bank the Board of Governors of the Federal Reserve holding company or State member bank, unless System under section 5(b) of the Bank Holding exempted, require prior notice to the Board. In Company Act of 1956 ("the Act") (12 U.S.C. addition, a purchase, assignment, transfer, pledge, § 1844(b)) and section 7(j)(13) of the Federal or other disposition of voting stock through which Deposit Insurance Act, as amended by the Change any person will acquire ownership, control, or the in Bank Control Act of 1978 ("the Control Act"), power to vote ten per cent or more of a class of (12 U.S.C. § 1817(j)(13)). Sections 225.2 voting securities of a bank holding company or through 225.6 of this Part implement the Act, and State member bank will be deemed to be an section 225.7 of this Part implements the Control acquisition by such person of the power to direct Act. that institution's management or policies if: (b) Terms used in the Act. As used in this Part, (1) the institution has issued any class of sethe terms "bank holding company," "company," curities subject to registration under section 12 of "bank," "subsidiary," and "Board" have the the Securities Exchange Act of 1934 (15 U.S.C. same meanings as those given such terms in the § 781); or Act. As used in section 225.7 of this Part, the (2) immediately after the transaction no other term "person" has the meaning given it in the person will own a greater proportion of that class Control Act. of voting securities. (c) Federal Reserve Bank. The term "Federal Other transactions resulting in a person's control Reserve Bank" as used in this Part with respect of less than 25 per cent of a class of voting shares to action by, on behalf of, or directed to be taken of a bank holding company or State member bank by a bank holding company or other organization shall mean either the Federal Reserve Bank of the Federal Reserve district in which the operations 14 Control is defined in the Control Act as the power, directly or indirectly, to direct the management or policies, or to vote of the bank holding company or other organization 25 per cent or more of any class of voting securities, of an are principally conducted, as measured by total institution. (12 U.S.C. § 1817(j)(8)(B)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 158 Federal Reserve Bulletin • February 1979 would not result in control for purposes of the Act. through testate or intestate succession or bona fide An acquiring person may request an opportunity gift, provided the acquirer advises the Federal to contest the presumption established by this Reserve Bank within thirty days after the acquisiparagraph with respect to a proposed transaction. tion and provides any information specified in The Board will afford the person an opportunity paragraph 6 of the Control Act that the Reserve to present views in writing or, where appropriate, Bank requests; orally before its designated representatives either (4) a transaction subject to approval under secat informal conference discussions or at informal tion 3 of the Bank Holding Company Act or presentations of evidence. section 18 of the Federal Deposit Insurance Act; (b) Notices. Section 265.3 of the Board's Rules (5) a transaction described in sections 2(a)(5) of Procedure governs the submission of notices or 3(a)(A) or (B) of the Bank Holding Company required by the Control Act, except that notices Act by a person there described; should be sent to the Federal Reserve Bank of the (6) a customary one-time proxy solicitation and district in which the affected bank or bank holding receipt of pro-rata stock dividends; and company is located. Notice shall not be considered (7) the acquisition of shares of a foreign bank given unless information provided is responsive holding company, as defined in section 225.4(g) to every item specified in paragraph 6 of the of this Part, provided this exemption does not Control Act (12 U.S.C. § 1817(j)(6)), or every extend to the reports and information required item prescribed in the appropriate Board forms. under paragraphs 9, 10, and 12 of the Control Act With respect to personal financial statements re- (12 U.S.C. § 1817(j)(9), (10), and (12)). quired by paragraph 6 (B) of the Control Act, an individual acquirer may include a current state- 3. Effective March 10, 1979, section 265.2(f) ment of assets and liabilities, as of a date within of Rules Regarding Delegation of Authority is 90 days of the notice, a brief income summary, amended by adding the following new subparaand a statement of material changes since the date graph (38): thereof, subject to the authority of the Federal Reserve Bank or the Board to require additional ^ ^t % * ^ information. (38) Under the provisions of the Change in (c) Exempt transactions. The following trans- Bank Control Act of 1978 (12 U.S.C. § 1817(j)) actions are not subject to the prior notice require- and section 225.7 of this chapter (Regulation Y), ments of the Control Act: with respect to a bank holding company or State (1) the acquisition of additional shares of a bank member bank, to determine the informational sufholding company or State member bank by a ficiency of notices and reports filed under the Act, person who continuously since March 9, 1979, to extend periods for consideration of notices, to held power to vote 25 per cent or more of the determine whether a person who is or will be voting shares of that institution, or by a person subject to a presumption described in section who has acquired and maintained control of that 225.7(a) of this chapter should file a notice reinstitution after complying with the Control Act's garding a proposed transaction, and, if all the procedures; following conditions are met, to issue a notice of (2) the acquisition of additional shares of a bank intention not to disapprove a proposed change in holding company or State member bank by a control: person who under paragraph (a) of this section (i) no member of the Board has indicated an would be deemed to have controlled that institution objection prior to the Reserve Bank's action. continuously since March 9, 1979, if: (ii) all relevant departments of the Reserve (i) the transaction will not result in that person's Bank concur. direct or indirect ownership or power to vote 25 (iii) if the proposal involves shares of a State per cent or more of any class of voting securities member bank or a bank holding company controlof the institution; or ling a State member bank, the appropriate bank (ii) in other cases, the Board determines that supervisory authorities have indicated that they the person has controlled the institution continu- have no objection to the proposal, or no objection ously since March 9, 1979; has been received from the appropriate bank super- (3) the acquisition of shares in satisfaction of visory authorities within the time allowed by the a debt previously contracted in good faith or Act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 159 (iv) no significant policy issue is raised by the with two other banks and bank holding companies proposal as to which the Board has not expressed located in Bank's market.2 The combined deposits its view. of Bank and the affiliated banks total $81.7 million, which represents 2.54 percent of market deposits. This combined market share does not represent an adverse concentration of banking resources. Furthermore, Applicant's principal BANK HOLDING COMPANY owners, officers, and directors were among the AND BANK MERGER ORDERS principal organizers of all three banks. While ISSUED BY THE BOARD OF GOVERNORS approval of the subject proposal would further solidify the existing relationship between Bank and Orders Under Section 3 the two affiliated banks and reduce the likelihood of Bank Holding Company Act that Bank would become an independent competi- Catoosa Bancshares, Inc., tor in the future, based upon the facts of record, Catoosa, Oklahoma including the size and rank in the market of the banks involved and the presence of other banking Order Approving alternatives in the Tulsa banking market, it appears Formation of a Bank Holding Company that consummation of this proposal would not result in any significant adverse effects upon com- Catoosa Bancshares, Inc., Catoosa, Oklahoma, petition in any relevant area. Thus, competitive has applied for the board's approval under section factors are consistent with approval. 3(a)(1) of the Bank Holding Company Act (12 Where principals of an applicant are engaged U.S.C. § 1842(a)(1)), to become a bank holding in operating a chain of one-bank holding compacompany through the acquisition of 100 percent, nies, the board applies multibank holding company less directors' qualifying shares, of the voting standards in assessing the financial and managerial shares of 1st Bank of Catoosa, Catoosa, Oklahoma resources and future prospects both of an applicant ("Bank"). seeking to become a one-bank holding company Notice of the application, affording an opportuand of its proposed subsidiary bank. Based upon nity for interested persons to submit comments and such an analysis in this case, the financial and views, has been given in accordance with section managerial resources and future prospects of Ap- 3(b) of the Act (43 Federal Register 53820 plicant, Bank and the affiliated banks and bank (1978)). The time for filing comments and views holding companies appear to be satisfactory. Aphas expired, and the application and all comments plicant will incur no debt in its acquisition of Bank received have been considered in light of the stock. Moreover, Applicant has committed to profactors set forth in section 3(c) of the Act (12 vide additional capital to Bank within 120 days U.S.C. § 1842(c)). following approval of this proposal. Therefore, Applicant is a nonoperating corporation with no considerations relating to banking factors in regard subsidiaries, organized for the purpose of becomto this proposal are consistent with approval of ing a bank holding company through the acquisition of Bank, which has deposits of $9.0 million.1 the application. Although consummation of the proposal would Upon acquisition of Bank, Applicant would conresult in no changes in the banking services offered trol the 281st largest bank in Oklahoma, holding by Bank, considerations relating to the conven- .07 percent of total deposits in commercial banks ience and needs of the community to be served in the state. are consistent with approval. It has been deter- Bank is the 36th largest of 46 banks operating mined that consummation of this transaction would in the relevant banking market, which is the Tulsa be consistent with the public interest and that the RMA, and controls 0.28 percent of total market application should be approved. deposits. The purpose of the transaction is to facilitate the transfer of the ownership of Bank from individuals to a corporation controlled by the 2 Applicant's principals are associated with a proposed Oksame individuals. Principal owners, officers, and lahoma bank holding company, Security Bancshares, Inc., Tulsa, Oklahoma. The board approved the application by directors of Applicant and Bank are also associated Security Bancshares, Inc., to acquire 100 percent, less directors' qualifying shares, of Security Bank, Tulsa, Oklahoma, 1 Banking data as of December 31, 1977. on October 31, 1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 160 Federal Reserve Bulletin • February 1979 On the basis of the record, the application is is to be located in an unincorporated community approved for the reasons summarized above. The in Harris County, approximately 20 miles west of transaction shall not be made (a) before the thir- downtown Houston. Applicant ranks as the largest tieth day following the effective date of this Order of 122 banking organizations in the Houston or (b) later than three months after the effective banking market,2 with 13 subsidiary banks condate of this Order, unless such period is extended trolling 20.6 percent of total market deposits. for good cause by the Board of Governors or by Applicant's banking subsidiary closest to Bank is the Federal Reserve Bank of Kansas City, pursuant located approximately 13 miles northeast of Bank, to delegated authority. outside of Bank's proposed service area. Since By order of the Secretary of the Board, acting Bank is a proposed new bank, Applicant's acquipursuant to authority delegated from the Board of sition of Bank would not eliminate any existing Governors, effective January 24, 1979. competititon, nor would it have any immediate effect upon Applicant's share of commercial bank (Signed) Griffith L. Garwood, deposits in the relevant market. While under some [seal] Deputy Secretary of the Board. circumstances de novo expansion in a market by a leading organization within that market could reduce prospects for market deconcentration by First City Bancorporation of Texas, Inc., preempting viable sites for de novo entry or ex- Houston, Texas pansion by other firms, Applicant's de novo expansion in the rapidly growing Houston banking Order Approving Acquisition of Bank market would have only a minimal impact upon market entry conditions.3 From the facts of record, First City Bancorporation of Texas, Inc., Housit appears that even after consummation of the ton, Texas, a bank holding company within the proposal the market would remain attractive for meaning of the Bank Holding Company Act, has de novo entry and that ample opportunities for applied for the board's approval under section market deconcentration will remain, through either 3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to foothold or de novo entry. Accordingly, based acquire 100 percent of the voting shares (less upon all the facts of record, including the growth directors' qualifying shares) of First City Bankof the Houston market, the large number of com- Bear Creek, Harris County, Texas ("Bank"), a peting organizations therein, and the opportunities proposed new bank. for market deconcentration, the Board concludes Notice of the application, affording opportunity that approval of this application would not result for interested persons to submit comments and in any adverse effects upon competition in any views, has been given in accordance with section relevant area. 3(b) of the Act. The time for filing comments and views has expired, and the board has considered The financial and managerial resources and futhe application and all comments received in light ture prospects of Applicant and its subsidiary of the factors set forth in section 3(c) of the Act banks are regarded as consistent with approval of (12 U.S.C. § 1842(c)). this application. Bank, as a proposed de novo Applicant, the second largest banking organi- bank, has no financial or operating history; howzation in Texas, controls 31 banking subsidiaries, ever, its prospects as a subsidiary of Applicant with aggregate deposits of approximately $4.8 appear favorable. Accordingly, considerations rebillion, representing 8 percent of total deposits in lating to banking factors are consistent with apcommercial banks in the state.1 Since Bank is a proval of this application. The establishment of proposed new bank, Applicant's acquisition of Bank would not cause any immediate increase in 2 The Houston banking market is approximated by the Houston Ranally Metropolitan Area ("RMA"), which includes Applicant's share of deposits in commercial banks Harris County and portions of Brazoria, Fort Bend, Galveston, in Texas. Liberty, and Montgomery Counties in Texas. 3 The Houston banking market experienced a population Bank has received charter approval from the increase of 25.4 percent during the 1970-1978 period, and Department of Banking of the state of Texas and the population of the city of Houston increased by 18.4 percent. During the same period the population for the state of Texas increased by only 14.6 percent. It is also noted that the ratio 1 All deposit data are as of December 31, 1977, and reflect of population-to-banking offices in the Houston banking market bank holding company formations and acquisitions approved is 1.45 times the statewide average and per capita deposits as of November 30, 1978. in the market are 1.32 times the statewide average. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 161 Bank would provide a new and convenient full- for interested persons to submit comments and service banking alternative for the area's residents. views, has been given in accordance with § 3(b) Thus, considerations relating to the convenience of the Act. The time for filing comments and views and needs of the community to be served lend has expired, and the board has considered the some weight toward approval of the application. application and all comments received, including Accordingly, it is the board's judgment that con- those of the Comptroller of the Currency, in light summation of the transaction would be in the of the factors set forth in § 3(c) of the Act (12 public interest and that the application should be U.S.C. § 1842(c)). approved. Applicant, the fourth largest banking organi- On the basis of the record, the application is zation in the state of Texas, has eighteen banking approved for the reasons summarized above. The subsidiaries with aggregate deposits of $3,930 transaction shall not be made (a) before the thir- million, representing 6.46 percent of commercial tieth calendar day following the effective date of bank deposits in the state.1 Acquisition of Bank, this Order, or (b) later than three months after that one of the state's smaller banking organizations, date, and (c) First City Bank-Bear Creek, Harris would increase Applicant's share of commercial County, Texas, shall be opened for business not bank deposits in Texas by less than one-tenth of later than six months after the effective date of one percent. this Order. Each of the periods described in (b) By Order dated October 25, 1973 (38 F.R. and (c) may be extended for good cause by the 30581), the board approved the application of board, or by the Federal Reserve Bank of Dallas, Applicant to become a bank holding company pursuant to delegated authority. through the direct acquisition of Republic National By order of the Board of Governors, effective Bank of Dallas ("Republic Bank") and the indi- January 15, 1979. rect acquisition of 29.9 percent of the voting shares of Oak Cliff Bank & Trust Company, Dallas, Texas. In addition to its interest in Bank, Republic Voting for this action: Chairman Miller and Gover- Bank at the time also owned indirectly between nors Wallich, Coldwell, Partee, and Teeters. 5 and 24.99 percent of the shares of 20 other (Signed) Griffith L. Garwood, banks, 17 of which were in the Dallas banking [seal] Deputy Secretary of the Board. market.2 Applicant represented to the board that it would file separate applications for prior approval by the board for acquisition of additional Republic of Texas Corporation, shares in each of certain of those banks, and would Dallas, Texas divest completely its interests in others. In its Order the board stated that each such application Order Approving Acquisition of Bank filed by Applicant would be considered on its own merits in light of the statutory standards set forth Republic of Texas Corporation, Dallas, Texas, in § 3 of the Act. a bank holding company within the meaning of Bank is the 31st largest banking organization the Bank Holding Company Act, has applied for in the Dallas banking market and holds deposits the board's approval under § 3(a)(3) of the Act (12 of $55.5 million, representing 0.3 percent of the U.S.C. § 1842(a)(3)) to acquire all of the voting total deposits held by commercial banks in the shares (less directors' qualifying shares) of the market. Applicant is already a significant competsuccessor by merger to The First National Bank itor in the Dallas banking market. Applicant, with of Piano, Piano, Texas ("Bank"). The bank into seven subsidiary banks, is the largest banking which Bank is to be merged has no significance organization in that market and holds total deposits except as a means to facilitate the acquisition of of $3,047.9 million,3 representing 26.3 percent of the voting shares of Bank. Accordingly, the prothe total deposits in commercial banks in the posed acquisition of shares of the successor orgamarket. nization is treated herein as the proposed acquisition of the shares of Bank. Applicant presently 1 All banking data are as of March 31, 1978. controls 24.85 percent of the voting shares of 2 The Dallas banking market is approximated by the Dallas RMA. Bank. 3 This figure reflects bank holding company acquisitions and Notice of the application, affording opportunity formations approved as of October 31, 1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 162 Federal Reserve Bulletin • February 1979 While consummation of the proposal would est and that the application should be approved. appear to eliminate some existing competition in- On the basis of the record, the application is asmuch as Applicant and Bank operate in the same approved for the reasons summarized above. The market, the board notes that Applicant, or its transaction shall not be made (a) before the thirpredecessor in interest, Republic Bank, has held tieth calendar day following the effective date of 24.85 percent or more of the shares of Bank since this Order or (b) later than three months after the 1956, and that the nature of this relationship is effective day of this Order unless such period is such that little, if any, meaningful competition extended for good cause by the board or by the presently exists between Bank and Applicant's Federal Reserve Bank of Dallas pursuant to delesubsidiary banks in the Dallas market. But for the gated authority. history of the established relationship between By Order of the Board of Governors, effective Applicant and Bank, the effects on existing com- January 26, 1979. petition would be viewed as more serious, but viewed in light of that relationship the effects are Voting for this action: Chairman Miller and Goveronly slight. Moreover, while Applicant is one of nors Wallich, Partee, and Teeters. Absent and not the largest organizations in the banking market, voting: Governor Coldwell. in view of the facts presented in the record of this application, the board does not regard the slight (Signed) Griffith L. Garwood, increase in concentration of market deposits as [seal] Deputy Secretary of the Board. significant. Accordingly, the board concludes that the proposed acquisition of Bank by Applicant would not have significant adverse effects on Citizens Ban-Corporation, competition. Rock Port, Missouri The financial and managerial resources of Ap- Order Denying Acquisition of Bank plicant and its subsidiaries are regarded as satisfactory and their future prospects appear favorable. Citizens Ban-Corporation, Rock Port, Missouri, The financial and managerial resources and future a bank holding company within the meaning of prospects of Bank are also regarded as satisfactory, the Bank Holding Company Act, has applied for particularly in light of Applicant's commitment to the board's approval under section 3(a)(3) of the provide Bank with additional capital. Therefore, Act (12 U.S.C. § 1842(a)(3)) to acquire 95.31 per considerations relating to banking factors are con- cent of the voting shares of Farmers and Merchants sistent with and lend some weight toward approval Bank of Elmo ("Bank"), Elmo, Missouri. of the application. Notice of the application, affording opportunity Upon consummation of the proposed acquisi- for interested persons to submit comments and tion, Applicant will assist Bank in developing views, has been given in accordance with section programs to enable it to serve the banking needs 3(b) of the Act. The time for filing comments and of all sections of the city of Piano. In particular, views has expired, and the Board has considered Applicant intends to cause Bank to increase its the application and all comments received in light commercial lending in order to help meet the of the factors set forth in section 3(c) of the Act general credit needs of the rapidly expanding Piano (12 U.S.C. § 1842(c)). community. In addition, affiliation with Applicant Applicant, a one-bank holding company, conwill provide Bank's customers with access to trols The Citizens Bank of Atchison County credit life and credit accident and health insurance ("Rock Port"), Rock Port, Missouri. The acquioffered by a subsidiary of Applicant at rates below sition of Bank would increase Applicant's share the state maximum rates currently charged by of total deposits in commercial banks in Missouri Bank. Thus, considerations relating to conven- from 0.07 per cent to 0.11 per cent, and would ience and needs of the community to be served not have an appreciable eff ect on the concentration lend some weight toward approval of the applica- of banking resources in the state. tion, and in the board's view, outweigh any Bank, with deposits of $7.5 million,1 is the slightly adverse effects on competition that might fourth largest of six commercial banks in its bankresult from consummation of this proposal. Accordingly, it is the board's judgment that the proposed acquisition would be in the public inter- 1 All banking data are as of December 31, 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 163 ing market.2 Bank and Rock Port are located in ability to furnish additional capital if needed in separate banking markets, and consummation of response to unforeseen problems in its subsidiary this proposal would not eliminate any significant banks. competition. Accordingly, competitive consid- The Board has considered Applicant's manageerations are consistent with approval. rial resources, which it regards as satisfactory. Under the Bank Holding Company Act, the However, these managerial considerations do not board is required to consider the financial and outweigh the adverse financial factors, and theremanagerial resources of an applicant and its sub- fore, considerations relating to the banking factors sidiary banks. In the exercise of that responsibility, warrant denial of this application. the board has indicated on previous occasions that As indicated above, the proposed acquisition is it will closely examine the condition of an appli- essentially a restructuring of the ownership intercant to ensure that it will serve as a source of ests of Bank and consummation of the proposal financial and managerial strength to its subsidiary would not result in an immediate change in the banks.3 The board finds that considerations relating service provided by Bank. Consequently, considto the financial resources of Applicant warrant erations relating to the convenience and needs of denial of the application. The board has previously the community to be served are consistent with, stated that less restrictive debt to equity standards but do not lend weight toward, approval of the can appropriately be applied to prospective one- application. bank holding companies if the adverse effects On the basis of all the circumstances concerning associated with leverage are outweighed by public this application, the board concludes that the benefits in the case of transfers of ownership of banking considerations involved in the proposal small rural banks. However, the financial structure present adverse factors bearing upon the financial of a multi-bank holding company should be more resources and future prospects of Applicant and conservative than that of a one-bank holding com- Bank. These adverse factors are not outweighed pany.4 by any procompetitive effects or by benefits to the In connection with this proposal, Applicant convenience and needs of the relevant community. would incur acquisition debt of approximately Accordingly, it is the board's judgment that ap- $1.3 million, which Applicant proposes to service proval of the application would not be in the public over a twelve-year period solely through earnings interest and that the application should be denied. of its subsidiary banks. Neither Applicant nor any On the basis of the facts of record, the applicaof its principals will have contributed any cash tion is denied for the reasons summarized above. towards the purchase of Bank. Applicant's By order of the Board of Governors, effective principals purchased Bank in February 1978 ex- January 19, 1979. clusively with debt, and Applicant would assume this debt in its entirety. Applicant may be able Voting for this action: Chairman Miller and Goverto retire its debt while maintaining a satisfactory nors Wallich, Coldwell, Partee, and Teeters. capital position for its subsidiary banks, but capital ratios at both banks would decline below current (Signed) Griffith L. Garwood, ratios. Although by itself this decline would not [seal] Deputy Secretary of the Board. necessarily constitute an adverse factor, it compounds Applicant's initial weak financial position, Orders Under Section 4 and Applicant's proposal would greatly limit its of Bank Holding Company Act 2 The relevant banking market is approximated by Nodaway Alaska Bancorporation, County, Missouri, and the southern one-third of Page County, Iowa. Anchorage, Alaska 3 Section 3(c) of the Act provides that the board must, in every case, consider, among other things, the financial and Order Approving Retention and Acquisition of managerial resources of both the applicant company and the Voting Shares of Alaska Bancshares, Inc. bank to be acquired. The board's action in this case is based on a consideration of such factors. See Board of Governors of the Federal Reserve System v. First Lincolnwood Corpora- Alaska Bancorporation, Anchorage, Alaska, a tion, 47 U.S.L.W. 4048 (December 11, 1978). bank holding company within the meaning of the 4 See Stuarco Oil Company, Inc., 61 FEDERAL RESERVE Bank Holding Company Act, has applied for the BULLETIN 178, 179(1975); BHCo, Inc., 60FEDERAL RESERVE BULLETIN 123, 124 (1974). board's approval, under § 4(c)(8) of the Act (12 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 164 Federal Reserve Bulletin • February 1979 U.S.C. § 1843(c)(8)) and § 225.4(b)(2) of the the alternative, to apply to the board for approval board's Regulation Y (12 C.F.R. § 225.4(b)(2)), to retain them.3 to retain its 89.6 percent interest in Alaska Banc- Applicant is the fifth largest banking organishares, Inc., Anchorage, Alaska ("Bancshares"), zation in Alaska by virtue of its control of Bank. and to acquire additional voting shares of Banc- Bank has deposits of $90.9 million, representing shares so that Bancshares will become a wholly approximately 5.8 percent of the total deposits in owned subsidiary of Applicant.1 Bancshares en- commercial banks in the state.4 Applicant does not gages in the activity of acting as agent or broker engage in any other nonbanking activities. for the sale of life and accident insurance and Bancshares conducts its credit life and credit health insurance in connection with extensions of accident and health insurance agency business credit by its banking subsidiary, Alaska Statebank, solely in connection with extensions of credit by Anchorage, Alaska ("Bank").2 Such activity has Bank. Bank has a total of eight branches, located been determined by the board to be closely related in three relevant markets in Alaska, at which to banking (12 C.F.R. § 225.4(a)(9)(ii)). Applicant otters credit-related insurance. Inas- Notice of the application, affording opportunity much as Bancshares had been engaged in its infor interested persons to submit comments and surance agency activities for some time prior to views on the public interest factors, has been duly its acquisition by Applicant, and Applicant was published (43 Federal Register 55820). The time not engaging in any insurance activities at that for filing comments and views has expired, and time, it appears that the acquisition of Bancshares the board has considered the application and all by Applicant did not eliminate any existing or comments received in the light of the public inter- potential competition between the two. Accordest factors set forth in § 4(c)(8) of the Act (12 ingly, the board concludes that Applicant's acqui- U.S.C. § 1843(c)(8)). sition of Bancshares did not have any adverse Applicant, a one-bank holding company, be- effects on competition in any relevant area, and came a bank holding company as a result of the that its retention of Bancshares, as well as pro- 1970 Amendments to the Act, by virtue of its posed acquisition of additional shares, would not control of the majority of the voting shares of have any adverse competitive effects. Bank. Applicant acquired a total of 65 percent Applicant's retention of Bancshares as its of the voting shares of Bancshares during 1969 wholly owned subsidiary will ensure the continued and 1970. Pursuant to the provisions of section availability of credit life and credit accident and 4 of the Act, Applicant has until December 31, health insurance to customers of Bank. Further- 1980, to divest these shares of Bancshares or, in more, there is no evidence in the record to indicate that consummation of the proposal would result in any undue concentration of resources, unfair competition, conflicts of interest or unsound bank- 1 The shares which Applicant seeks permission to retain ing practices. On the basis of the foregoing and include 666.666 common shares acquired in December 1974 other facts of record, the board concludes that the and 768 common shares acquired in June 1976, as well as 804 preferred shares acquired in December 1976, all of which benefits to the public resulting from Applicant's acquisitions were in violation of section 4 of the Act. The acquisition of Bancshares outweigh any possible board has examined all of the circumstances surrounding Apadverse effects that could have resulted from the plicant's acquisition of these shares, including Applicant's correspondence with the Federal Reserve Bank of San Francisco concerning the proposed acquisitions, and the fact that Bancshares was authorized to continue to engage in its non- 3 Section 4 of the Act provides, inter alia, that nonbanking banking activities on the basis of permanent grandfather privi- activities acquired between June 30, 1968, and December 31, leges pursuant to the proviso contained in section 4(a)(2) of 1970, by a company which becomes a bank holding company the Act, and has concluded (hat the violations were inadvertent as a result of the 1970 Amendments may not be retained beyond and of a technical nature. Furthermore, when advised of the December 31, 1980, without prior board approval. In Deviolations, Applicant acted responsibly and cooperated fully cember 1972, the board determined that Bancshares was entiwith the Federal Reserve System in seeking to resolve the tled to engage in its nonbanking activities on the basis of matter. Accordingly, the board has concluded that the viola- permanent grandfather privileges pursuant to the proviso of tions are not so serious as to require denial of this application. section 4(a)(2) of the Act, since these activities had been 2 Bancshares is also engaged in impermissible real estate commenced by Bancshares before June 30, 1969, but noted development activities, which Applicant has not applied for that Applicant, which acquired Bancshares in July 1969, was the board's approval to retain. Accordingly, pursuant to section not entitled to grandfather rights for such activities (59 FED- 4(a)(2) of the Act, Applicant must divest its indirect interest ERAL RESERVE BULLETIN 211 (1973)). in Bancshares' impermissible activities on or before December 4 Unless otherwise noted, all financial data are as of June 31, 1980. 30, 1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 165 affiliation, and in the board's view approval of stallment sales financing. Rouss engages in con- Applicant's retention of Company as a wholly sumer lending. In addition, both Winchester and owned subsidiary can reasonably be expected to Rouss act as agent in the sale of credit life and continue to produce benefits to the public that credit accident and health insurance directly rewould outweigh possible adverse effects. lated to such extensions of credit. Such activities Based upon the foregoing and other consid- have been determined by the board to be closely erations reflected in the record, the board has related to banking (12 C.F.R. § 225.4(a)(1) and determined that the balance of the public interest (9)). factors the board is required to consider under Notice of the application, affording opportunity § 4(c)(8) is favorable, and the application should for interested persons to submit comments and be approved. Accordingly, the application is views on the public interest factors, has been duly hereby approved. The acquisition shall be con- published (43 Federal Register 38940). The time summated no later than three months after the for filing comments and views has expired, and effective date of this Order unless such period is the board has considered the application and all extended by the board or the Federal Reserve Bank comments received in light of the public interest of San Francisco. This determination is subject to factors set forth in section 4(c)(8) of the Act (12 the conditions set forth in § 225.4(c) of Regulation U.S.C. § 1843(c)(8)). Y and to the board's authority to require such Applicant controls two banks and is the 14th modification or termination of the activities of a largest banking organization in Virginia, controlholding company or any of its subsidiaries as the ling aggregate deposits of $150.2 million, repreboard finds necessary to assure compliance with senting 0.9 per cent of the total deposits in comthe provisions and purposes of the Act and the mercial banks in the state.1 Winchester and Rouss board's regulations and orders issued thereunder, have assets of $5.5 million and $0.6 million, or to prevent evasion thereof. respectively, as of May 31, 1978. Applicant be- By order of the Board of Governors, effective came a bank holding company on December 31, January 19, 1979. 1970, as a result of the 1970 Amendments to the Act, by virtue of its control at that time of Farmers and Merchants National Bank, Winchester, Vir- Voting for this action: Chairman Miller and Goverginia ("Bank"). Applicant acquired all of the nors Wallich, Coldwell, Partee, and Teeters. outstanding shares of Winchester and its wholly (Signed) Griffith L. Garwood, owned subsidiary, Rouss, on July 10, 1970. Pur- [seal] Deputy Secretary of the Board. suant to the provisions of section 4 of the Act, Applicant has until December 31, 1980, to divest itself of its interest in Winchester and Rouss or, in the alternative, to apply for and secure the F&M National Corporation, Board's approval to retain such interest. Winchester, Virginia In order to approve an application under section Order Denying Retention of Winchester Credit 4(c)(8) of the Act, the board must determine Corporation and its wholly owned subsidiary, whether the activities of the company to be ac- Rouss Finance Company quired or retained are "so closely related to banking or managing or controlling banks as to be a F&M National Corporation, Winchester, Virproper incident thereto." Where, as here, the ginia, a bank holding company within the meaning activities of the subject company have been deterof the Bank Holding Company Act, has applied mined previously by regulation to be closely refor the board's approval under section 4(c)(8) of lated to banking, the board is required to consider the Act (12 U.S.C. § 1843(c)(8)) and section whether a bank holding company's operation of 225.4(b)(2) of the board's Regulation Y (12 that company "can reasonably be expected to C.F.R. § 225.4(b)(2)) to retain all of the voting produce benefits to the public such as greater shares of Winchester Credit Corporation ("Win- convenience, increased competition, or gains in chester"), and its wholly owned subsidiary, Rouss Finance Company ("Rouss"), both of Winchester, Virginia. Winchester engages in commercial, 1 Banking data are as of March 31, 1978, unless otherwise mortgage, and consumer lending, as well as in- indicated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 166 Federal Reserve Bulletin • February 1979 efficiency, that outweigh possible adverse effects, As stated above, Applicant must bear the burden such as undue concentration of resources, de- of showing that the benefits to the public that have creased or unfair competition, conflicts of interest, resulted or will result from the application outor unsound banking practices." This statutory test weigh in the public interest the adverse effects. requires a positive showing by an applicant that However, it appears from the facts of record that the public benefits of its proposal outweigh the any public benefits stemming from the acquisition possible adverse effects. The board regards the of Winchester and Rouss could have been achieved standards under section 4(c)(8) of the Act for by Applicant on a de novo basis or through Bank retention of shares to be the same as the standards without the elimination of two alternative sources for a proposed acquisition. of competition in the market. The relevant product market to be considered Based upon the foregoing and other considin evaluating the competitive effects of this pro- erations reflected in the record, the board has posal is the making of personal cash loans, and determined that the balance of the public interest the board has previously determined that consumer factors the board is required to consider under finance companies compete with commercial section 4(c)(8) is not favorable. Accordingly, this banks in the area of personal loans.2 At the time application is denied. Applicant acquired Winchester and Rouss in 1970, By order of the Board of Governors, effective Bank, which was then Applicant's sole banking January 12, 1979. subsidiary, was the largest of four banking organizations in the Winchester City/Frederick County Voting for this action: Chairman Miller and Governors Wallich, Coldwell, Partee, and Teeters. banking market,3 with deposits of $45.4 million, and controlled 19.8 percent of the market's per- (Signed) Griffith L. Garwood, sonal cash loans. At that time, Winchester and [seal] Deputy Secretary of the Board. Rouss, each of which had one office located in the same market as Bank, held assets of $1.1 million and $0.5 million, respectively, and con- NCNB Corporation, trolled 2.3 percent and 1.2 percent, respectively, Charlotte, North Carolina of the market's personal cash loans. Thus, in the aggregate, Applicant controlled 23.3 percent of Order Approving the market's personal cash loans in 1970. By Retention of NCNB Mortage Company year-end 1977, Bank's market share had grown NCNB Corporation, Charlotte, North Carolina, to 26.2 percent, while the market shares of a bank holding company within the meaning of Winchester and Rouss were 2.1 percent, and 1.7 the Bank Holding Company Act, has applied for percent, respectively. Thus, Applicant's market the board's approval, under section 4(c)(8) of the share of personal cash loans had increased to 30 percent by year-end 1977.4 The facts of record Act (12 U.S.C. § 1843(c)(8)) and section 225.4(b)(2) of the board's Regulation Y (12 indicate that the acquisition of Winchester and C.F.R. § 225.4(b)(2)) to retain NCNB Mortgage Rouss by Applicant in 1970 eliminated a signifi- Company, Charlotte, North Carolina ("Comcant amount of existing competition in the relevant pany"), a company that engages in the activities market and, as a result, Applicant has further of mortgage banking, including originating, and increased its share of the market's personal cash servicing for its own account and the account of loans. Accordingly, in the board's view, the adothers, conventional and guaranteed residential, verse effects upon competition resulting from the apartment, commercial, and industrial loans. acquisition by Applicant of Winchester and Rouss Company also acts as agent for the sale of credit weigh against approval of this application. life insurance and credit accident and health insurance directly related to its extensions of credit. 2 See Bankers Trust Corporation (Public Loan Company), Such activities have been determined by the board 59 FEDERAL RESERVE BULLETIN 694 (1973). 3 The Winchester City/Frederick County banking market is to be closely related to banking (12 C.F.R. comprised of the city of Winchester and the surrounding county § 225.4(a)(1),(3), and (9)).1 of Frederick. 4 Applicant also engages in consumer lending through Peo- 1 Company also engages, through six subsidiaries, in real ples Loans, Incorporated, Luray, Virginia, a nonbank subsidiestate development activities that are impermissible for a bank ary located outside the relevant banking market, acquired on holding company. Under section 4(a)(2) of the Act, these October 30, 1974, pursuant to board approval. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 167 Notice of the application, affording opportunity from the information available, it does not appear for interested persons to submit comments and that the effects of the acquisition on existing comviews on the public interest factors, has been duly petition were significant. published (43 Federal Register 45644). The time Company operates 17 offices in six markets in for filing comments and views has expired, and North Carolina, as well as Atlanta, Georgia, and the board has considered the application and all Orlando, Florida. As of December 31, 1977, comments received in light of the public interest Company, with a real estate mortgage servicing factors set forth in section 4(c)(8) of the Act (12 portfolio of $722 million, ranked 58th among all U.S.C. § 1843(c)(8)). mortgage companies in the United States. Com- Applicant, a one-bank holding company, be- pany engages principally in the origination and came a bank holding company as a result of the servicing of 1-4 family residential mortgage loans 1970 Amendments to the Act by virtue of its in six local markets in North Carolina. In 1977 control of North Carolina National Bank, Char- Company originated an aggregate of $93 million lotte, North Carolina ("Bank"). Company was 1-4 family residential loans in North Carolina. organized as a subsidiary of Applicant on De- Bank also engages in originating 1-4 family resicember 6, 1968. Pursuant to the provisions of dential mortgages in the six North Carolina marsection 4 of the Act, Applicant has until December kets where Company is represented. However, in 31, 1980, to divest its interest in Company or, 1977 Company and Bank originated $94.8 million in the alternative, to apply to secure the board's of 1 to 4 family residential mortgages in North approval to retain such interest.2 The board regards Carolina, representing from 2.0 to 5.1 percent the standards under section 4(c)(8) for retention of such loans in the relevant markets where both of shares to be the same as the standards for a Company and Bank operate, and a combined proposed acquisition of a 4(c)(8) activity. average of 3.9 percent of such loans. In view Applicant is the second largest banking organi- of the small market shares held by Bank and zation in North Carolina by virtue of its control Company, Applicant cannot be regarded as domiof Bank, which has deposits of $2.5 billion, rep- nant in the mortgage lending market in any releresenting 17.2 percent of the total deposits in vant area. The board concludes, based on all the commercial banks in the state.3 In addition to facts of record, that Applicant's acquisition did engaging in mortgage banking and related insur- not have any significant adverse effects on compeance activities in North Carolina through Com- tition in any relevant area. Furthermore, there is pany, Applicant engages through subsidiaries in no evidence in the record indicating that the proa variety of nonbanking activities, including con- posal would result in undue concentration of resumer finance, mortgage banking outside of North sources, unfair competition, conflicts of interests, Carolina, factoring, providing trust services, and unsound banking practices or other adverse efacting as an investment advisor. Company was fects. established by Applicant in 1968 to assume the It appears that Applicant's acquisition of Commortgage banking business of Bank, including the pany has produced benefits to the public such as assets of two small mortgage companies acquired greater efficiency in processing loans. In particuby Bank in 1965 and 1967. While at the time of lar, Applicant has installed a new data processing acquisition Bank also conducted mortgage busi- system which has enabled Company to improve ness in the same markets as these two companies, its mortgage servicing activities. In addition, Applicant has, through Company, actively particiactivities may not be retained beyond December 31, 1980, pated in government programs designed to expand and Applicant has committed to the board that it will disconthe availability of low and moderate income houstinue these activities by divesting these subsidiaries by December 31, 1980. In addition, Company has four other subsid- ing. These benefits to the public are consistent with iaries engaged in nonbanking activities for which Applicant approval of the subject application, and it is the claims other exemptions under the Act. Accordingly, Applicant board's view that approval of Applicant's retention has not applied for the board's approval to retain such subsidiaries, and the board's action herein does not pertain to such of Company can reasonably be expected to consubsidiaries. tinue to produce benefits to the public that would 2 Section 4 of the Act provides, inter alia, that nonbanking outweigh possible adverse effects. activities acquired between June 30, 1968, and December 31, 1970, by a company that becomes a bank holding company Based upon the foregoing and other considas a result of the 1970 Amendments may not be retained beyond erations reflected in the record, the board has December 31, 1980, without board approval. 3 All banking data are as of June 30, 1978. determined that the balance of the public interest Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 168 Federal Reserve Bulletin • February 1979 factors the board is required to consider under 1. Northwestern is a corporation organized § 4(c)(8) is favorable. Accordingly, the applica- under the laws of the state of North Carolina on tion is hereby approved. This determination is January 10, 1969. On August 1, 1969, Northsubject to the conditions set forth in § 225.4(c) western acquired ownership and control of 99.8 of Regulation Y and to the board's authority to percent of the outstanding voting shares of The require such modification or termination of the Northwestern Bank, North Wilkesboro, North activities of a holding company or any of its Carolina ("Bank"). subsidiaries as the board finds necessary to assure 2. Northwestern became a bank holding comcompliance with the provisions and purposes of pany on December 31, 1970, as a result of the the Act and the board's regulations and orders 1970 Amendments to the BHC Act, by virtue of issued thereunder, or to prevent evasion thereof. its ownership and control at that time of more than By order of the Board of Governors, effective 25 percent of the outstanding voting shares of January 12, 1979. Bank, and it registered as such with the board on November 26, 1971. Northwestern would have been a bank holding company on July 7, 1970, Voting for this action: Chairman Miller and Goverif the BHC Act Amendments of 1970 had been nors Wallich, Coldwell, Partee, and Teeters. in effect on that date, by virtue of its ownership (Signed) Griffith L. Garwood, and control on that date of more than 25 percent [seal] Deputy Secretary of the Board. of the voting shares of Bank. Northwestern currently owns and controls 99.8 percent of the outstanding voting shares of Bank. Certifications Under the 3. Company is a wholly owned subsidiary of Bank Holding Company Tax Act of 1976 Northwestern acquired by merger on June 30, 1969. Since 1959 Company has engaged in the Northwestern Financial Corporation, insurance business, and is currently engaged in the North Wilkesboro, North Carolina activity of underwriting all types of ordinary, term, group, and credit life insurance, a hospital benefit Prior Certification Pursuant to the Bank plan, and accident and health insurance. North- Holding Company Tax Act of 1976 western owns and controls the 1,100,000 issued [Docket No. TCR 76-170] and outstanding shares of Company, all of which it acquired before July 7, 1970. Northwestern Financial Corporation, North 4. Northwestern did not file an application with Wilkesboro, North Carolina ("Northwestern"), the board, and did not otherwise obtain the board's has requested a prior certification pursuant to approval pursuant to § 4(c)(8) of the BHC Act, § 6158(a) of the Internal Revenue Code (the to retain the shares of Company or engage in the "Code"), as amended by § 3(a) of the Bank activities carried on by Company.2 Holding Company Tax Act of 1976 (the "Tax 5. On January 4, 1979, Northwestern con- Act"), that its proposed sale of all the 1,100,000 cluded negotiations with Beneficial for a Stock issued and outstanding shares of Northwestern Purchase Agreement providing for the sale of the Security Life Insurance Company, Phoenix, Arishares of Company to a subsidiary of Beneficial zona ("Company"), held by Northwestern, is for cash. Neither Beneficial nor any of its subsidinecessary or appropriate to effectuate § 4 of the aries is indebted to Northwestern or its subsidi- Bank Holding Company Act (12 U.S.C. § 1843) aries. ("BHC Act"). The shares of Company are to be sold to The Central National Life Insurance Company of Omaha, Omaha, Nebraska, a subsidiary of Beneficial Corporation, Wilmington, Delaware fication, Northwestern's Registration Statement filed with the ("Beneficial"), for $12,580,000 in cash. board pursuant to the BHC Act, and other records of the board. 2 Some or all of Company's activities may be among those In connection with this request, the following activities that the board previously has determined to be closely information is deemed relevant for purposes of related to banking under § 4(c)(8) of the BHC Act. However, issuing the requested certification:1 in the absence of approval by the board of an application by Northwestern to retain Company, Northwestern may not retain the shares of Company beyond December 31, 1980. (Cf. 1 This information derives from Northwestern's corre- Wachovia Corp., Docket No. TCR 76-132, 63 FEDERAL REspondence with the board concerning its request for this certi- SERVE BULLETIN 606 (May 9, 1977)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 169 6. No director, officer, or employee with policy (C) the sale of the shares of Company by making functions of Northwestern or any of its Northwestern is necessary or appropriate to effecsubsidiaries (including honorary and advisory tuate § 4 of the BHC Act. directors) holds any such position with Beneficial This certification is based upon the repreor any subsidiary thereof. sentations made to the board by Northwestern and 7. Northwestern does not control in any manner upon the facts set forth above. In the event the the election of a majority of the directors, or board should hereafter determine that facts mateexercise a controlling influence over the manage- rial to this certification are otherwise than as repment or policies of Beneficial or its subsidiaries. resented by Northwestern, or that Northwestern On the basis of the foregoing information, it has failed to disclose to the board other material is hereby certified that: facts, it may revoke this certification. (A) Northwestern is a qualified bank holding By order of the Board of Governors acting corporation within the meaning of section through its General Counsel, pursuant to delegated 6158(F)(1) and section 1103(b) of the Code, and authority (12 C.F.R. § 265.2(b)(3), effective Jansatisfies the requirements of section 1103(b); uary 8, 1979. (B) the shares of Company proposed to be sold by Northwestern are "prohibited property" within the meaning of sections 6158(F)(2) and 1103(c) (Signed) Griffith L. Garwood, of the Code; and [seal] Deputy Secretary of the Board. ORDERS APPROVED UNDER BANK HOLDING COMPANY ACT By the Board of Governors During January 1979, the Board of Governors approved the applications listed below. Copies are available upon request to Publications Services, Division of Support Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Section 3 Board action (effective Applicant Bank(s) date) Capital Management, Inc., Broken Bow Enterprises, Inc., 1/29/79 Lincoln, Nebraska Broken Bow, Nebraska Chenoa Corporation, Bank of Chenoa, Chenoa, 1/15/79 Farmer City, Illinois Illinois Lockney Bancshares, Inc., First National Bank in Lockney, 1/19/79 Lockney, Texas Lockney, Texas Miles Service Corporation, Miles Savings Bank, 1/12/79 Miles, Iowa Miles, Iowa Northwest Ohio Bancshares, Inc., The Willard United Bank, 1/26/79 Toledo, Ohio Willard, Ohio Palisade Bancshares, Inc., The Palisade National Bank, 1/25/79 Palisade, Colorado Palisade, Colorado South Plains Bancshares, Inc., Idalou State Bank, 1/12/79 Idalou, Texas Idalou, Texas T & C Bancorp, Inc., Town and Country Bank, 1/15/79 St. Joseph, Missouri Quincy, Illinois Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 170 Federal Reserve Bulletin • February 1979 Section 4 Nonbanking company Effective Applicant (or activity) date Chenoa Corporation, To act as agent or broker 1/15/79 Farmer City, Illinois for the sale of insurance directly related to extensions of credit by Bank 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 4 Reserve Effective Applicant Bank(s) Bank date CB & T Bancshares, Inc., Security Bank and Trust Atlanta 1/23/79 Columbus, Georgia Company of Albany, Albany, Georgia Central Wisconsin Community State Bank, Chicago 1/15/79 Bancshares, Inc., Eau Claire, Wisconsin Wausau, Wisconsin ORDERS APPROVED UNDER BANK MERGER ACT Reserve Effective Applicant Bank(s) Bank date Central Bank of Northern First Manassas Bank and Richmond 1/15/79 Virginia, Bailey's Crossroads, Trust Company, Manassas, Virginia Virginia Fidelity American Bank, Fidelity American Bank, Richmond 1/25/79 Norfolk, Virginia Eastern Shore, Parksley, Virginia United Jersey Bank, United Jersey Bank/South Bergen, New York 1/25/79 Hackensack, New Jersey Carlstadt, New Jersey Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 171 PENDING CASES INVOLVING THE BOARD OF GOVERNORS Does not include suits against the Federal Reserve Banks in which the Board of Governors is not named a party. California Life Corporation v. Board of Gover- Michigan National Corporation v. Board of Govnors, filed January 1979, U.S.C.A. for the ernors, filed January 1978, U.S.C.A. for the District of Columbia. Sixth Circuit. Hunter Holding Company v. Board of Governors, Wisconsin Bankers Association v. Board of Govfiled December 1978, U.S.C.A. for the Eighth ernors, filed January 1978, U.S.C.A. for the Circuit. District of Columbia. Consumers Union of the United States v. G. Vickars-Henry Corp. v. Board of Governors, filed William Miller, et al., filed December 1978, December 1977, U.S.C.A. for the Ninth Cir- U.S.D.C. for the District of Columbia. cuit. Commercial National Bank, et alv. Board of Emch v. The United States of America, et al., Governors, filed December 1978, U.S.C.A. for filed November 1977, for the Eastern District the District of Columbia. of Wisconsin. Ella Jackson et al., v. Board of Governors, filed Central Bank v. Board of Governors, filed Oc- November 1978, U.S.C.A. for the Fifth Circuit. tober 1977, U.S.C.A. for the District of Co- Metro-North State Bank, Kansas City v. Board lumbia. of Governors, filed October 1978, U.S.C. A. for Investment Company Institute v. Board of Goverthe Eighth Circuit. nors, filed September 1977, U.S.D.C. for the Manchester-Tower Grove Community Organi- District of Columbia. zation/ACORN v. Board of Governors, filed BankAmerica Corporation v. Board of Gover- September 1978, U.S.C.A. for the District of nors, filed May 1977, U.S.D.C. for the North- Columbia. ern District of California. Beckley v. Board of Governors, filed July 1978, BankAmerica Corporation v. Board of Gover- U.S.D.C. for the Northern District of Illinois. nors, filed May 1977, U.S.C.A. for the Ninth Independent Bankers Association of Texas v. First Circuit. National Bank in Dallas, et al., filed July 1978, Roberts Farms, Inc. v. Comptroller of the Cur- U.S.C.A. for the Northern District of Texas. rency, et al., filed November 1975, U.S.D.C. Mid-Nebraska Bancshares, Inc. v. Board of Gov- for the Southern District of California. ernors, filed July 1978, U.S.C.A. for the Dis- Florida Association of Insurance Agents, Inc. v. trict of Columbia. Board of Governors, and National Association NCNB Corporation v. Board of Governors, filed of Insurance Agents, Inc. v. Board of Gover- June 1978, U.S.C.A. for the Fourth Circuit. nors, filed August 1975, actions consolidated United States League of Savings Associations v. in U.S.C.A. for the Fifth Circuit. Board of Governors, filed May 1978, U.S.D.C. David R. Merrill, et al., v. Federal Open Market for the District of Columbia. Committee of the Federal Reserve System, filed Citicorp v. Board of Governors, filed March 1978, May 1975, U.S.D.C. for the District of Colum- U.S.C.A. for the Second Circuit. bia. Security Bancorp and Security National Bank v. Bankers Trust New York Corporation v. Board Board of Governors, filed March 1978, of Governors, filed May 1973, U.S.C.A. for U.S.C.A. for the Ninth Circuit. the Second Circuit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1 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, partnerships, and corporations POLICY INSTRUMENTS A8 Federal Reserve Bank interest rates FINANCIAL MARKETS A9 Member bank reserve requirements A10 Maximum interest rates payable on A25 Commercial paper and bankers time and savings deposits at federally acceptances outstanding insured institutions A26 Prime rate charged by banks on All Federal Reserve open market short-term business loans transactions A26 Terms of lending at commercial banks All 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, 1978 agencies—Debt outstanding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 2 Federal Reserve Bulletin • February 1979 SECURITIES MARKETS AND International Statistics CORPORATE FINANCE A54 U.S. international transactions— A36 New security issues—State and local Summary governments and corporations A55 U.S. foreign trade A37 Open-end investment companies—Net A55 U.S. reserve assets sales and asset position A56 Foreign branches of U.S. banks— A37 Corporate profits and their distribution Balance sheet data A38 Nonfinancial corporations—Assets and A58 Selected U.S. liabilities to foreign liabilities official institutions A38 Business expenditures on new plant and equipment REPORTED BY BANKS IN THE UNITED STATES A39 Domestic finance companies—Assets and liabilities; business credit A59 Liabilities to foreigners A61 Banks' own claims on foreigners A62 Banks' own and domestic customers REAL ESTATE claims on foreigners A40 Mortgage markets A63 Banks' own claims on unaffiliated A41 Mortgage debt outstanding foreigners A63 Liabilities to and claims on foreigners CONSUMER INSTALLMENT CREDIT SECURITIES HOLDINGS AND TRANSACTIONS A42 Total outstanding and net change A64 Marketable U.S. Treasury bonds and A43 Extensions and liquidations notes—Foreign holdings and transactions FLOW OF FUNDS A64 Foreign official assets held at F.R. A44 Funds raised in U.S. credit markets Banks A45 Direct and indirect sources of funds to A65 Foreign transactions in securities credit markets REPORTED BY NONBANKING CONCERNS IN Domestic Nonfinancial Statistics THE UNITED STATES A66 Short-term liabilities to and claims on A46 Nonfinancial business activity— foreigners Selected measures A67 Long-term liabilities to and claims on A46 Output, capacity, and capacity foreigners utilization A47 Labor force, employment, and unemployment INTEREST AND EXCHANGE RATES A48 Industrial production—Indexes and A68 Discount rates of foreign central banks gross value A68 Foreign short-term interest rates A50 Housing and construction A51 Consumer and wholesale prices A69 Guide to Tabular Presentation A52 Gross national product and income A53 Personal income and saving and Statistical Releases Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Statistics A3 1.10 MONETARY AGGREGATES AND INTEREST RATES 1978 1978 Item Ql Q2 Q3 Q4 Aug. Sept. Oct. Nov. Dec. Monetary and credit aggregates (annual rates of change, seasonally adjusted in per cent)12 Member bank reserves 1 Total 8.9 6.2 8.6 3.1 -5.0 8.6 5.4 -3.5 6.1 2 Required 8.8 6.7 8.6 2.8 -4.2 8.0 6.1 -5.3 6.1 3 Nonborrowed 14.5 0.6 6.6 5.4 0.2 11.3 -0.9 13.5 1.3 Concepts of money1 4 M-l 6.6 9.2 8.1 4.4 8.5 1133..88 1.7 -2.0 1.7 5 M-1 + 5.0 7.2 6.0 2.5 7.2 12.1 0.8 -4.9 -1.4 6 M-2 7.0 8.4 9.9 7.7 11.6 13.0 6.5 4.7 2.7 7 M-3 8.1 8.4 10.4 9.4 11.5 13.4 8.9 6.7 5.6 Time and savings deposits Commercial banks: 8 Total 12.5 11.5 11.3 12.4 10.9 12.7 8.5 21.9 5. J 9 Savings 2.0 3.8 2.3 -0.9 4.8 9.7 -1.6 -9.6 -7.5 10 Other time 11.7 11.4 18.5 19.2 21.2 14.8 19.3 24.5 12.0 11 Thrift institutions 2 9.7 8.5 11.1 11.7 11.3 14.0 12.0 9.8 9.7 12 Total loans and investments at commercial banks 3 10.1 14.9 10.8 7.7 5.1 9.7 9.8 6.7 1.1 1978 1978 1979 Ql Q2 Q3 Q4 Sept. Oct. Nov. Dec. Jan. Interest rates (levels, per cent per annum) Short-term rates 13 Federal funds4 6.76 7.28 8.09 9.58 8.45 8.96 9.76 10.03 10.07 14 Federal Reserve discount 5 6.46 6.78 7.50 9.09 7.83 8.26 9.50 9.50 9.50 15 Treasury bills (3-month market yield) 6 6.39 6.48 7.31 8.57 7.85 7.99 8.64 9.08 9.35 16 Commercial paper (90- to 119-day)6-7 6.76 7.16 8.03 9.83 8.39 8.98 10.14 10.37 10.25 Long-term rates Bonds: 17 U.S. government8 8.19 8.43 8.53 8.78 8.47 8.69 8.75 8.90 8.98 18 State and local government^ 5.65 6.02 6.16 6.28 6.09 6.13 6.19 6.51 6.47 19 Aaa utility (new issue)1® 8.70 8.98 8.94 9.23 8.86 9.17 9.27 9.28 9.54 20 Conventional mortgages11 9.23 9.58 9.80 r10.12 9.80 9.95 10.10 '10.30 10.30 1 M-l equals currency plus private demand deposits adjusted. 6 Quoted on a bank-discount basis. M-l + equals M-l plus savings deposits at commercial banks, NOW 7 Beginning Nov. 1977, unweighted average of offering rates quoted by accounts at banks and thrift institutions, credit union share draft ac- five dealers. Previously, most representative rate quoted by these dealers. counts, and demand deposits at mutual savings banks. 8 Market yields adjusted to a 20-year maturity by the U.S. Treasury. M-2 equals M-l plus bank time and savings deposits other than large 9 Bond Buyer series for 20 issues of mixed quality. negotiable certificates of deposit (CDs). I o Weighted averages of new publicly offered bonds rated Aaa, Aa, M-3 equals M-2 plus deposits at mutual savings banks, savings and and A by Moody's Investors Service and adjusted to an Aaa basis. loan associations, and credit union shares. Federal Reserve compilations. 2 Savings and loan associations, mutual savings banks, and credit II Average rates on new commitments for conventional first mortgages unions. on new homes in primary markets, unweighted and rounded to nearest 3 Quarterly changes calculated from figures shown in table 1.23. 5 basis points, from Dept. of Housing and Urban Development. 4 Seven-day averages of daily effective rates (average of the rates on 12 Unless otherwise noted, rates of change are calculated from average a given date weighted by the volume of transactions at those rates). amounts outstanding in preceding month or quarter. 5 Rate for the Federal Reserve Bank of New York. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A4 Domestic Nonfinancial Statistics • February 1979 1.11 FACTORS AFFECTING MEMBER BANK RESERVES Millions of dollars Monthly averages of daily Weekly averages of daily figures for weeks ending— figures FFFaaaccctttooorrrsss 1978 1979 1978 1979 Nov. Dec. Jan.P Dec. 20 Dec. 27 Jan. 3 Jan. 10 Jan. 17 Jan. 24f Jan. 3If SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding.... 111122229999,,,,555544444444 111122229999,,,,333333330000 111122228888,,,,888800005555 111122229999,,,,666644444444 111133331111,,,,333300007777 111133332222,,,,666677778888 128,914 129,659 127,746 126,657 2 U.S. government securities1 111111111111,,,,222244443333 111100009999,,,,222255555555 111100005555,,,,222288887777 111100009999,,,,999900002222 111100007777,,,,888833335555 111111110000,,,,333300006666 104,737 107,131 104,725 102,629 3 Bought outright 111111110000,,,,777722228888 111100008888,,,,777788880000 111100005555,,,,111155551111 111100009999,,,,777799998888 111100007777,,,,333377775555 111100009999,,,,000033332222 104,737 107,131 104,725 102,629 4 Held under repurchase agreement 555511115555 444477775555 111133336666 111100004444 444466660000 1111,,,,222277774444 5 Federal agency securities 8888,,,,111100009999 8888,,,,000088889999 7777,,,,999900005555 7777,,,,999944442222 8888,,,,222211112222 8888,,,,222222225555 7,892 7,892 7,889 7,832 6 Bought outright 7777,,,,999922228888 7777,,,,888899997777 7777,,,,888877778888 7777,,,,888899996666 7777,,,,888899996666 7777,,,,888899995555 7,892 7,892 7,889 7,832 7 Held under repurchase agreement 111188881111 111199992222 22227777 44446666 333311116666 333333330000 8 Acceptances 111188880000 111166667777 55556666 6666 111111110000 555577774444 99999 LLLLLoooooaaaaannnnnsssss 777722222222 888877774444 999999994444 555566668888 1111,,,,444411113333 1111,,,,111188883333 686 896 924 1,427 1111100000 FFFFFllllloooooaaaaattttt 6666,,,,555588888888 7777,,,,444422223333 9999,,,,999933338888 7777,,,,333322222222 9999,,,,222266664444 7777,,,,999911117777 11,088 9,354 9,859 9,471 1111111111 OOOOOttttthhhhheeeeerrrrr FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee aaaaasssssssssseeeeetttttsssss.................... 2222,,,,777700002222 3333,,,,555522222222 4444,,,,666622225555 3333,,,,999900004444 4444,,,,444477773333 4444,,,,444477772222 4,512 4,386 4,349 5.299 1111122222 GGGGGooooolllllddddd ssssstttttoooooccccckkkkk 11111111,,,,666644445555 11111111,,,,666633335555 11111111,,,,666622225555 11111111,,,,666611111111 11111111,,,,666622228888 11111111,,,,666677771111 11,660 11,609 11,608 11,603 1111133333 SSSSSpppppeeeeeccccciiiiiaaaaalllll DDDDDrrrrraaaaawwwwwiiiiinnnnnggggg RRRRRiiiiiggggghhhhhtttttsssss ccccceeeeerrrrrtttttiiiiifffffiiiiicccccaaaaattttteeeee aaaaaccccccccccooooouuuuunnnnnttttt 1111,,,,333300000000 1111,,,,333300000000 1111,,,,333300000000 1111,,,,333300000000 1111,,,,333300000000 1111,,,,333300000000 1,300 1,300 1,300 1.300 1111144444 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy cccccuuuuurrrrrrrrrreeeeennnnncccccyyyyy ooooouuuuutttttssssstttttaaaaannnnndddddiiiiinnnnnggggg 11111111,,,,777777779999 11111111,,,,888822226666 11111111,,,,888866667777 11111111,,,,888822222222 11111111,,,,888844444444 11111111,,,,888833338888 11,850 11,864 11,875 11,888 AAAAABBBBBSSSSSOOOOORRRRRBBBBBIIIIINNNNNGGGGG RRRRREEEEESSSSSEEEEERRRRRVVVVVEEEEE FFFFFUUUUUNNNNNDDDDDSSSSS 1111155555 CCCCCuuuuurrrrrrrrrreeeeennnnncccccyyyyy iiiiinnnnn ccccciiiiirrrrrcccccuuuuulllllaaaaatttttiiiiiooooonnnnn 111111110000,,,,999922229999 111111113333,,,,333399995555 111111112222,,,,333344441111 111111113333,,,,333322229999 111111114444,,,,333377777777 111111114444,,,,777722220000 113,761 112,599 111,437 110,552 1111166666 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy cccccaaaaassssshhhhh hhhhhooooollllldddddiiiiinnnnngggggsssss 222277778888 222266660000 222255550000 222266661111 222244445555 222244442222 246 247 249 261 DDDDDeeeeepppppooooosssssiiiiitttttsssss,,,,, ooooottttthhhhheeeeerrrrr ttttthhhhhaaaaannnnn mmmmmeeeeemmmmmbbbbbeeeeerrrrr bbbbbaaaaannnnnkkkkk rrrrreeeeessssseeeeerrrrrvvvvveeeeesssss wwwwwiiiiittttthhhhh FFFFF.....RRRRR..... BBBBBaaaaannnnnkkkkksssss::::: 1111177777 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy 8888,,,,111188886666 3333,,,,999933331111 3333,,,,333377779999 3333,,,,777744448888 4444,,,,999955552222 3333,,,,888888882222 3,116 3,302 3,420 3,477 1111188888 FFFFFooooorrrrreeeeeiiiiigggggnnnnn 222288889999 333300001111 222288888888 222299992222 333322220000 333333334444 341 277 269 256 1111199999 OOOOOttttthhhhheeeeerrrrr22222 555544440000 777722224444 888822226666 666666666666 666622220000 1111,,,,222200004444 710 786 858 789 2222200000 OOOOOttttthhhhheeeeerrrrr FFFFF.....RRRRR..... llllliiiiiaaaaabbbbbiiiiillllliiiiitttttiiiiieeeeesssss aaaaannnnnddddd cccccaaaaapppppiiiiitttttaaaaalllll 4444,,,,111199993333 4444,,,,333322222222 4444,,,,555522222222 4444,,,,333366667777 4444,,,,555544448888 4444,,,,333344443333 4,417 4,490 4,593 4,658 2222211111 MMMMMeeeeemmmmmbbbbbeeeeerrrrr bbbbbaaaaannnnnkkkkk rrrrreeeeessssseeeeerrrrrvvvvveeeeesssss wwwwwiiiiittttthhhhh FFFFF.....RRRRR..... BBBBBaaaaannnnnkkkkksssss 22229999,,,,888855553333 33331111,,,,111155558888 33331111,,,,999999991111 33331111,,,,777711115555 33331111,,,,000011118888 33332222,,,,777766665555 31,133 32,731 31,703 31,456 End-of-month figures Wednesday figures 1978 1979 1978 1979 Nov. Dec. Jan.f Dec. 20 Dec. 27 Jan. 3 Jan. 10 Jan. 17 Jan. 24p Jan. 31f SSSSSUUUUUPPPPPPPPPPLLLLLYYYYYIIIIINNNNNGGGGG RRRRREEEEESSSSSEEEEERRRRRVVVVVEEEEE FFFFFUUUUUNNNNNDDDDDSSSSS 2222222222 RRRRReeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaannnnnkkkkk cccccrrrrreeeeedddddiiiiittttt ooooouuuuutttttssssstttttaaaaannnnndddddiiiiinnnnnggggg.................... 131,605 111133331111,,,,333322227777 126,053 130,778 111133337777,,,,777799991111 111133331111,,,,999900005555 126,066 132,291 128,477 126,053 2222233333 UUUUU.....SSSSS..... gggggooooovvvvveeeeerrrrrnnnnnmmmmmeeeeennnnnttttt ssssseeeeecccccuuuuurrrrriiiiitttttiiiiieeeeesssss11111 113,305 111111110000,,,,555566662222 101,279 107,104 111111111111,,,,666633339999 111100006666,,,,888899996666 102,833 102,373 105,724 101,279 2222244444 BBBBBooooouuuuuggggghhhhhttttt ooooouuuuutttttrrrrriiiiiggggghhhhhttttt 113,305 111100009999,,,,444477778888 101,279 107,104 111100009999,,,,555588883333 111100006666,,,,777755555555 102,833 102,373 105,724 101,279 2222255555 HHHHHeeeeelllllddddd uuuuunnnnndddddeeeeerrrrr rrrrreeeeepppppuuuuurrrrrccccchhhhhaaaaassssseeeee aaaaagggggrrrrreeeeeeeeee----- 1111,,,,000088884444 2222,,,,000055556666 111144441111 26 Federal agency securities 7,899 8888,,,,000022229999 7,507 7,896 9999,,,,111166665555 7777,,,,999900001111 7,892 7,892 7,886 7,507 27 Bought outright 7,899 7777,,,,888899996666 7,507 7,896 7777,,,,888899996666 7777,,,,888899992222 7,892 7,892 1,886 7,507 28 Held under repurchase agree- 111133333333 1111,,,,222266669999 9999 29 Acceptances 555588887777 444444444444 333300003333 30 Loans 813 1111,,,,111177774444 4,364 504 3333,,,,111111110000 666611115555 759 2,043 1,081 4,364 31 Float 7,238 6666,,,,444433332222 7,227 10,932 8888,,,,888811112222 11111111,,,,777777775555 10,318 15,305 9,392 7,227 32 Other Federal Reserve assets.... 2,350 4444,,,,555544443333 5,676 4,342 4444,,,,666622221111 4444,,,,444411115555 4,264 4,678 4,394 5,676 33 Gold stock 11,642 11111111,,,,666677771111 11,592 11,611 11111111,,,,666677771111 11111111,,,,666677771111 11,624 11,608 11,608 11,592 34 Special Drawing Rights certificate account 1,300 1111,,,,333300000000 1,300 1,300 1111,,,,333300000000 1111,,,,333300000000 1,300 1,300 1,300 1,300 35 Treasury currency outstanding 11,790 11111111,,,,888833331111 11,909 11,822 11111111,,,,888844446666 11111111,,,,888844447777 11,854 11,870 11,882 11,909 ABSORBING RESERVE FUNDS 36 Currency in circulation 112,072 111111114444,,,,666644445555 110,683 114,075 111111115555,,,,222222227777 111111114444,,,,777788886666 113,478 112,294 111,158 110,683 37 Treasury cash holdings 267 222244440000 264 250 222244441111 222244445555 249 244 249 264 Deposits, other than member bank reserves with F.R. Banks: 38 Treasury 6,587 4444,,,,111199996666 3,522 4,500 3333,,,,555544440000 3333,,,,555577778888 2,286 3,061 3,432 3,522 39 Foreign 379 333366668888 339 275 222288885555 222277770000 234 316 291 339 40 Other2 567 1111,,,,222255556666 874 582 666611113333 777755554444 653 712 853 874 41 Other F.R. liabilities and capital. .. 4,545 4444,,,,222277775555 4,594 4,499 4444,,,,777700004444 4444,,,,111166669999 4,345 4,542 4,596 4,594 42 Member bank reserves with F.R. Banks 31,919 33331111,,,,111155552222 30,578 31,329 33337777,,,,999999999999 33332222,,,,999922221111 29,600 35,900 32,688 30,578 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 1977 1978 1979 Dec. May June July Aug. Sept. Oct. Nov. Dec. Jan.? All member banks Reserves: 1 At F.R. Banks 27,057 27,890 27,840 28,570 28,079 28,010 28,701 29,853 31,158 31,991 2 Currency and coin 9,351 9,151 9,345 9,542 9,512 9,605 9,654 9,794 10,330 11,099 3 Total held i 36,471 37,119 37,262 38,189 37,666 37,689 38,434 39,728 41,572 43,221 4 Required 36,297 36,867 37,125 38,049 37,404 37,614 38,222 39,423 41,447 42,873 5 Excess1 174 252 137 140 262 75 212 305 125 348 Borrowings at F.R. Banks:2 6 Total 558 1,227 1,111 1,286 1,147 1,068 1,261 722 874 994 7 Seasonal 54 93 120 143 188 191 221 185 134 106 Large banks in New York City 8 Reserves held 6,244 6,315 6,341 6,606 6,334 6,182 6,428 6,682 7,120 7,677 9 Required 6,279 6,236 6,376 6,581 6,290 6,251 6,349 6,658 7,243 7,690 10 Excess -35 79 -35 25 44 -69 79 24 -123 -13 11 Borrowings2 48 113 54 129 58 78 157 48 99 117 Large banks in Chicago 12 Reserves held 1,593 1,697 1,668 1,708 1,648 1,655 1,672 1,791 1,907 1,986 13 Required 1,613 1,669 1,670 1,707 1,646 1,650 1,649 1,765 1,900 2,010 14 Excess -20 28 -2 2 5 23 26 7 -24 15 Borrowings2 26 19 20 20 3 35 14 4 10 22 Other large banks 16 Reserves held 13,993 14,106 14,250 14,553 14,502 14,564 14,862 15,547 16,446 16,873 17 Required 13,931 14,079 14,225 14,569 14,423 14,541 14,867 15,447 16,342 16,930 18 Excess 62 27 25 -16 79 23 -5 100 104 -57 19 Borrowings2 243 500 536 499 417 363 408 194 276 269 All other banks 20 Reserves held 14,641 15,001 15,003 15,322 15,182 15,288 15,472 15,708 16,099 16,253 21 Required 14,474 14,883 14,854 15,192 15,045 15,172 15,357 15,553 15,962 16,243 22 Excess 167 118 149 130 137 116 115 155 137 10 23 Borrowings2 241 595 501 638 669 592 682 476 489 586 Weekly averages of daily figures for weeks ending- 1978 1979 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27 Jan. 3 Jan. 10 Jan. 17 Jan. 24f Jan. 31f All member banks Reserves: 24 At F.R. Banks 31,416 31,328 30,139 31,715 31,018 32,765 31,133 32,731 31,703 31,456 25 Currency and coin 9,785 10,056 10,843 10,006 10,258 10,538 10,450 11,991 11,169 11,025 26 Total held1 41,283 41,465 41,063 41,802 41,357 43,420 41,722 44,860 42,996 42,608 27 Required 41,130 41,138 40,911 41,565 41,412 42,694 41,844 44,456 42,991 42,278 28 Excess1 153 327 152 237 -55 726 -122 404 5 330 Borrowings at F.R. Banks:2 29 Total 792 698 591 568 1,413 1,183 686 896 924 1,427 30 Seasonal 180 150 131 131 131 119 93 98 105 114 Large banks in New York City 31 Reserves held 6,968 7,300 7,122 7,391 6,871 7,933 7,204 8,472 7,451 7,292 32 Required 6,980 7,236 7,130 7,300 7,025 7,734 7,360 8,379 7,658 7,345 33 Excess -12 64 -8 91 -154 199 -156 93 -207 -53 34 Borrowings2 31 330 143 169 14 299 Large banks in Chicago 35 Reserves held 1,886 1,891 1,862 1,945 1,883 1,964 1,959 2,261 1,845 1,903 36 Required 1,881 1,913 1,867 1,950 1,849 1,944 1,955 2,224 1,941 1,950 37 Excess 5 -22 -5 -5 34 20 4 37 -96 -47 38 Borrowings2 6 10 6 29 9 3 3 90 Other large banks 39 Reserves held 16,323 16,206 16,174 16,383 16,391 17,120 16,459 17,545 17,054 16,722 40 Required 16,255 16,093 16,133 16,377 16,439 16,846 16,519 17,488 17,001 16,748 41 Excess 68 113 41 6 -48 274 -60 57 53 -26 42 Borrowings2 236 176 193 106 488 470 241 234 199 339 All other banks 43 Reserves held 16,106 16,068 15,905 16,083 16,212 16,403 16,100 16,582 16,257 16,353 44 Required 16,014 15,896 15,781 15,938 16,099 16,170 16,010 16,365 16,391 16,235 45 Excess 92 172 124 145 113 233 90 217 -134 118 46 Borrowings2 519 522 388 456 566 561 442 493 708 699 i 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 • February 1979 1.13 FEDERAL FUNDS TRANSACTIONS Money Market Banks Millions of dollars, except as noted 1978, week ending— 1979, week ending— TTyyppee Dec. 6 Dec. 13 Dec. 20 Dec. 27 Jan. 3 Jan. 10 Jan. 17 Jan. 24 Jan. 31 Total, 46 banks Basic reserve position 1 Excess reserves1 169 127 166 -40 331 -36 6655 --1111 4466 LESS: 2 Borrowings at F.R. Banks 62 81 1 590 226 79 211 4422 443399 3 Net interbank federal funds transactions 1155,,882233 1177,,446688 1155,,442211 15,136 1144,,881133 1177,,662233 1177,,005522 1155,,224488 1122,,992288 EQUALS: Net surplus, or deficit (-): 4 Amount -15,716 -17,422 --1155,,225566 -15,765 -14,708 --1177,,773377 -17,199 --1155,,330011 --1133,,332211 5 Percent of average required reserves 87.7 97.7 83.7 88.1 77.8 96.7 85.2 81.4 72.6 Interbank federal funds transactions Gross transactions: 6 Purchases 23,567 23,265 23,624 22,886 23,480 24,357 23,953 22,400 20,855 7 Sales 1,1 AA 5,797 8,203 7,750 8,667 6,734 6,901 7,152 7,927 8 Two-way transactions2 55,,996655 4,952 66,,113355 5,854 66,,332299 5,421 55,,447711 55,,331155 66,,337700 Net transactions: 9 Purchases of net buying banks.. . 17,602 18,313 17,489 17,032 17,151 18,936 18,482 17,085 14,485 10 Sales of net selling banks 1,778 845 2,068 1,896 2,339 1,313 1,429 1,836 1,558 Related transactions with U.S. government securities dealers 11 Loans to dealers3 3,833 5,153 3,857 4,606 3,062 5,101 3,114 3,988 4,697 12 Borrowing from dealers4 1,831 1,590 1,226 1,865 1,679 1,232 1,146 1,414 1,336 13 Net loans 2,002 3,564 2,631 2,740 1,382 3,869 1,968 2,573 3,361 8 banks in New York City Basic reserve position 14 Excess reserves1 48 37 128 -61 169 -37 47 -9 -21 LESS: 15 Borrowings at F.R. Banks 331122 114433 116622 1144 227722 16 Net interbank federal funds transactions 22,,552299 4,136 22,,881166 3,134 44,,221144 44,,114455 44,,222266 22,,448800 22,,005500 EQUALS : Net surplus, or deficit (-): 17 Amount --22,,448811 --44,,009999 --22,,668888 --33,,550077 --44,,118888 --44,,118822 -4,341 --22,,550033 --22,,334444 18 Percent of average required reserves 37.8 63.4 40.6 55.1 59.5 62.6 57.0 36.2 35.4 Interbank federal funds transactions Gross transactions: 19 Purchases 4,281 4,894 4,940 4,658 5,299 5,078 5,227 4,142 3,674 20 Sales 1,752 758 2,124 1,523 1,085 933 1,001 1,663 1,623 21 Two-way transactions2 1,182 758 11,,550000 11,,337799 11,,008855 933 11,,000011 1,224 1,449 Net transactions: 22 Purchases of net buying banks.. . 3,099 44,,113366 3,440 3,278 44,,221144 44,,114455 44,,222266 2,919 2,225 2233 Sales of net selling banks 557700 662244 114444 443399 117755 Related transactions with U.S. government securities dealers 24 Loans to dealers3 2,114 2,970 2,382 3,066 1,896 3,206 1,790 2,366 2,987 25 Borrowing from dealers4 659 609 450 420 382 399 394 426 377 26 Net loans 1,455 2,361 1,932 2,646 1,514 2,807 1,396 1,940 2,610 38 banks outside New York City Basic reserve position 27 Excess reserves1 121 91 38 21 163 1 18 -2 67 LESS: 28 Borrowings at F.R. Banks 62 81 1 278 83 79 50 27 166 29 Net interbank federal funds transactions 13,294 13,332 1122,,660055 1122,,000022 10,600 1133,,447788 12,826 1122,,776699 1100,,887788 EQUALS : Net surplus, or deficit (-): 30 Amount -13,235 -13,323 --1122,,556677 --1122,,225588 --1100,,552200 -13,555 --1122,,885588 --1122,,779988 --1100,,997777 31 Percent of average required reserves 116.5 117.2 108.3 106.3 88.7 116.2 102.3 107.7 93.6 Interbank federal funds transactions Gross transactions: 32 Purchases 19,286 18,371 18,684 18,229 18,182 19,279 18,726 18,258 17,182 33 Sales 5,992 5,039 6,079 6,227 7,582 5,801 5,900 5,489 6,304 34 Two-way transactions2 44,,778833 4,194 4,635 44,,447755 5,245 44,,448888 44,,447700 44,,009922 44,,992211 Net transactions : 35 Purchases of net buying banks... 14,503 14,177 14,049 13,754 12,937 14,791 14,256 14,166 12,260 36 Sales of net selling banks 1,208 845 1,444 1,752 2,339 1,313 1,429 1,397 1,383 Related transactions with U.S. government securities dealers 37 Loans to dealers3 1,718 2,183 1,475 1,540 1,166 1,895 1,324 1,622 1,710 38 Borrowing from dealers4 1,172 981 lie 1,446 1,297 833 752 989 959 39 Net loans 547 1,202 699 94 -131 1,062 572 633 751 For notes see end of table. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Funds A7 1.13 Continued 1978, week ending— 1979, week ending— Type Dec. 6 Dec. 13 Dec. 20 Dec. 27 Jan. 3 Jan. 10 Jan. 17 Jan. 24 Jan. 31 5 banks in City of Chicago Basic reserve position 40 Excess reserves1 19 15 -19 23 37 17 45 22 17 LESS: 41 2299 8800 42 Net interbank federal funds transactions 5,424 5,930 6,477 6,025 5,379 6,131 5,880 5,207 4,597 EQUALS: Net surplus, or deficit (-): 43 Amount -5,405 -5,915 -6,497 -6,030 -5,341 -6,114 --55,,883355 --55,,118844 --44,,666611 44 Percent of average required reserves 304.1 341.6 355.2 348.9 293.3 333.9 278.1 284.9 255.1 Interbank federal funds transactions Gross transactions: 45 Purchases 7,030 7,082 7,704 7,183 6,746 7,309 7,168 6,708 6,123 46 Sales 1,606 1,153 1,226 1,158 1,368 1,179 1,288 1,501 1,525 47 Two-way transactions2 1,606 1,153 1,189 11,,110011 11,,229900 1,136 11,,221188 1,428 11,,550055 Net transactions: 48 Purchases of net buying banks... 5,424 5,930 6,515 6,083 5,456 6,173 5,950 5,280 4,618 4499 Sales of net selling banks 3388 5588 7777 4422 6699 7733 2200 Related transactions with U.S. government securities dealers 50 Loans to dealers3 216 215 300 259 179 266 213 179 209 51 Borrowing from dealers4 354 276 160 417 298 4 58 9 125 52 Net loans -139 -60 140 -158 -119 262 155 171. 84 33 other banks Basic reserve position 53 Excess reserves1 110022 7766 5588 -2 126 -16 -27 -25 51 LESS: 54 Borrowings at F.R. Banks 62 81 1 249 83 79 50 27 86 55 Net interbank federal funds transactions 7,871 7,403 6,128 5,977 5,221 7,347 6,946 7,562 6,280 EQUALS: Net surplus, or deficit (-): 56 Amount -7,830 -7,408 -6,071 -6,228 -5,178 -7,441 -7,023 -7,614 -6,316 57 Percent of average required reserves 81.7 76.9 62.1 63.5 51.6 75.7 67.0 75.7 6633..88 Interbank federal funds transactions Gross transactions: 58 Purchases 12,256 11,289 10,981 11,045 11,436 11,970 1111,,555588 11,550 1111,,005599 59 Sales 4,385 3,886 4,853 5,068 6,215 4,623 4,612 3,987 A,119 60 Two-way transactions2 3,177 3,041 3,446 3,374 3,954 3,352 3,252 2,663 3,417 Net transactions: 61 Purchases of net buying banks... 9,079 8,248 7,534 7,671 7,482 8,618 88,,330066 8,886 77,,664422 62 Sales of net selling banks 1,208 845 1,406 1,694 2,262 1,271 1,360 1,324 1,362 Related transactions with U.S. government securities dealers 63 Loans to dealers3 1,503 1,968 1,175 1,281 987 1,629 11,,111100 1,442 1,501 64 Borrowing from dealers4 818 705 616 1,029 999 829 694 980 834 65 Net loans 685 1,263 559 252 -12 800 417 462 667 1 Based on reserve balances, including adjustments to include waivers 4 Federal funds borrowed, net funds acquired from each dealer by of penalities 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, see 3 Federal funds loaned, net funds supplied to each dealer by clearing August 1964 BULLETIN, pp. 944-53. Back data for 46 banks appear in banks, repurchase agreements (purchases from dealers subject to resale), 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 • February 1979 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 sees. 13 and 13a1 Bank Regular rate Special rate 3 Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous 1/31/79 date rate 1/31/79 date rate 1/31/79 date rate 1/31/79 date rate Boston 91/2 11/2/78 81/2 10 11/2/78 9 IOI/2 11/2/78 91/2 12% 11/2/78 11% New York 91/2 11/1/78 81/2 10 11/1/78 9 IO1/2 11/1/78 91/2 121/2 11/1/78 11% Philadelphia 91/2 11/2/78 81/2 10 11/2/78 9 IO1/2 11/2/78 91/2 12% 11/2/78 11% Cleveland 91/2 11/2/78 81/2 10 11/2/78 9 IO1/2 11/2/78 9% 121/2 11/2/78 11% Richmond 91/2 11/2/78 81/2 10 11/2/78 9 IO1/2 11/2/78 9% 121/2 11/2/78 11% Atlanta 91/2 11/3/78 81/2 10 11/3/78 9 IOI/2 11/3/78 91/2 121/2 11/3/78 11% Chicago 91/2 11/2/78 81/2 10 11/2/78 9 IO1/2 11/2/78 9% 121/2 11/2/78 11% St. Louis 91/2 11/2/78 81/2 10 11/2/78 9 IOI/2 11/2/78 91/2 12% 11/2/78 11% Minneapolis 91/2 11/1/78 81/2 10 11/1/78 9 IO1/2 11/1/78 9% 121/2 11/1/78 11% Kansas City 91/2 11/2/78 81/2 10 11/2/78 9 IO1/2 11/2/78 9% 12% 11/2/78 11% Dallas 91/2 11/2/78 81/2 10 11/2/78 9 IO1/2 11/2/78 91/2 12% 11/2/78 11% San Francisco.... 91/2 11/2/78 81/2 10 11/2/78 9 IOI/2 11/2/78 91/2 121/2 11/2/78 11% 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% 51/2 1973—May 4. 534 534 1976—Jan. 19 5%-6 5% 11. 534-6 6 23 5% 5% 1971—Jan. 8 5V4-5V2 51/4 18. 6 Nov. 22 51/4-5% 51/4 1 1 5 9 5 5 - V 5% 4 5 5 % % June 1 1 5 1 . . 6 61 - / 6 2 i/ 2 6 6 1 % / 2 26 51/4 514 22 5-5% 5 July 2, 7 7 11997777——AAuugg.. 30 514-534 514 29 5 5 Aug. 14. 7-71/2 71/2 31 51/4-534 534 Feb. 13 4%-5 5 23, 7% 71/2 Sept. 2 534 534 July 2 1 1 3 6 9 4 y 4 5 4 V -5 4 4 5 5 3/4 1974—Apr. 2 3 5 0 , , 71/ 8 2 -8 1978— O Ja c n t . . 26 9 6 6 -6% 6 6 % Nov 11 4*4-5 5 Dec. 9, 734-8 734 20 6% 6% Dec. 1 1 3 9 41/ 4 2 - y 4 4 3 4 4 4 V 3/44 16, 734 734 May 1 1 2 1 6% 7 -7 7 7 17 41/2-4% 4 % 1975—Jan. 6 714-734 734 July 3 7-71/4 71/4 2 4 41/2 4V2 2 1 4 0, , 71 7 4 1 -7 /4 3 4 7 71 1 / 4 4 Aug. 2 1 1 0 7 7 3 1 / / 4 4 7 71 3 / 4 4 1973—Jan. 15 5 5 Feb. 5, 634-7% 63/4 Sept. 22 8 8 Feb. 26 5-51/2 5% 7, 634 634 Oct. 16 8-8% 8% M Ap a r r. . 2 2 3 5^ 5 -5 % 3 4 5 51 % /2 Mar. 1 1 0 4 61 6 4 1 -6 4 3 4 6 6 1 1 4 4 Nov. 20 1 8% 8% -9% 9 8 % % May 16 6-61/4 6 3 9% 9% 23 6 6 In effect Jan 31, 1979 9% 9% 1 Discounts of eligible paper and advances secured by such paper or by 4 Advances to individuals, partnerships, or corporations other than U.S. government obligations or any other obligations eligible for Federal member banks secured by direct obligations of, or obligations fully Reserve Bank purchase. guaranteed as to principal and interest by, the U.S. government or any 2 Advances secured to the satisfaction of the Federal Reserve Bank. agency thereof. Advances secured by mortgages on 1- to 4-family residential property 5 Rates under sees. 13 and 13a (as described above). For description are made at 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, 1972-76, and 1973-77. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A9 1.15 MEMBER BANK RESERVE REQUIREMENTS1 Percent of deposits Requirements in effect Previous requirements January 31, 1979 TTyyppee ooff ddeeppoossiitt,, aanndd ddeeppoossiitt iinntteerrvvaall iinn mmiilllliioonnss ooff ddoollllaarrss Percent Effective date Percent Effective date Net demand:2 0-2 7 12/30/76 m 2/13/75 12/30/76 10 2/13/75 10-100 ny4 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:2-3.4 Savings 3 3/16/67 m 3/2/67 Other time:5 0-5, maturing in— 30-179 days 3 3/16/67 3ft 3/2/67 180 days to 4 years 2 ft 1/8/76 3 3/16/67 4 years or more 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 2ft 1/8/76 3 12/12/74 10/30/75 3 12/12/74 1 Legal limits Net demand: Reserve city banks Other banks Time Borrowings from foreign banks 1 For changes in reserve requirements beginning 1963, see board's on net balances due from domestic banks to their foreign branches and Annual Statistical Digest, 1971-1975 and for prior changes, see board's on deposits that foreign branches lend to U.S. residents were reduced to Annual Report for 1976, Table 13. zero from 4 percent and 1 percent, respectively. The Regulation D reserve 2 (a) Requirement schedules are graduated, and each deposit interval requirement on borrowings from unrelated banks abroad was also reduced applies to that part of the deposits of each bank. Demand deposits to zero from 4 percent. subject to reserve requirements are gross demand deposits minus cash (d) Effective with the reserve computation period beginning Nov. 16, items in process of collection and demand balances due from domestic 1978, domestic deposits of Edge Corporations are subject to the same banks. reserve requirements as deposits of member banks. (b) The Federal Reserve Act specifies different ranges of requirements 3 Negotiable order of withdrawal (NOW) accounts and time deposits for reserve city banks and for other banks. Reserve cities are designated such as Christmas and vacation club accounts are subject to the same under a criterion adopted effective Nov. 9, 1972, by which a bank having requirements as savings deposits. net demand deposits of more than $400 million is considered to have the 4 The average reserve requirement on savings and other time deposits character of business of a reserve city bank. The presence of the head must be at least 3 percent, the minimum specified by law. office of such a bank constitutes designation of that place as a reserve 5 Effective November 2, 1978, a supplementary reserve requirement of city. Cities in which there are Federal Reserve Banks or branches are also 2 percent was imposed on time deposits of $100,000 or more, obligations reserve cities. Any banks having net demand deposits of $400 million or of affiliates, and ineligible acceptances. less are considered to have the character of business of banks outside of reserve cities and are permitted to maintain reserves at ratios set for banks NOTE. Required reserves must be held in the form of deposits with not in reserve cities. For details, see the board's Regulation D. Federal Reserve Banks or vault cash. (c) Effective August 24, 1978, the Regulation M reserve requirements Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 Domestic Nonfinancial Statistics • February 1979 1.16 MAXIMUM INTEREST RATES PAYABLE on Time and Savings Deposits at Federally Insured Institutions Percent per annum Commercial banks Savings and loan associations and mutual savings banks Type and maturity of deposit In effect Jan. 31, 1979 Previous maximum In effect Jan. 31, 1979 Previous maximum Percent Effective Percent Effective Percent Effective Percent Effective date date date date 1 Savings 5 7/1/73 41/2 1/21/70 5V4 (7) 5 (8) 2 Negotiable order of withdrawal accounts1 5 1/1/74 (10) 5 1/1/74 (10) 3 Money market time deposits of less than $100,0002 (9) (9> (9) (9) (9) (9) (9) (9> Other time (multiple- and singlematurity unless otherwise indicated) 3 30-89 days: 4 5 M Sin u g lt l i e p -m le- a m tu a r t i u ty ri ty 7/1/73 4 5 % 9 1 / / 2 2 6 1 / / 6 7 6 0 (10) (10) 90 days to 1 year: 6 7 S M in u g lt l i e p -m le- a m tu a r t i u ty ri ty 5% 7/1/73 7 9/ / 2 2 6 0 / / 6 6 6 6 45V 4 (7) 5V4 1/21/70 s* 8 1 to 2 vears4 5*4 1/21/70 1/21/70 1 9 0 i 2 y t 2 o t 2 o i / 4 2 y y e e a a r r s s 4 4 6 61 /2 7 7 / / 1 1 / / 7 7 3 3 5 5 Y 3 4 4 1 1/ / 2 2 1 1 / / 7 7 0 0 6 63 V / 2 4 ( ( 7 7 ) ) 6 1 1 / / 2 2 1 1 / / 7 7 0 0 1 1 1 2 6 4 t t o o 6 8 y y e e a a r r s s 5 5 7 71 % /2 1 1 2 1 / / 2 1 3 / / 7 7 3 4 (mn) 11/1/73 7731//24 1 1 2 1 /2 /1 3 / / 7 7 3 4 O 71/ 1 2 ) 11/1/73 13 8 years or more5 m 6/1/78 (10) 6/1/78 (10) 14 Issued to governmental units (all maturities) 6/1/78 m 12/23/74 6/1/78 m 12/23/74 15 Individual retirement accounts and Keogh (H.R. 10) plans6 6/1/78 7 Va 7/6/77 6/1/78 m 7/6/77 1 For authorized states only. Federally insured commercial banks, higher than the rate for commercial banks. The most recent rates and savings and loan associations, cooperative banks, and mutual savings effective dates are as follows: banks in Massachusetts and New Hampshire were first permitted to offer negotiable order of withdrawal (NOW) accounts on Jan. 1, 1974. Authorization to issue NOW accounts was extended to similar institutions Dec. 28 Jan. 4 Jan. 11 Jan. 18 Jan. 25 throughout New England on Feb. 27, 1976, and in New York State on Nov. 10, 1978. 2 Must have a maturity of exactly 26 weeks and a minimum denomina- 9.580 9.550 9.443 9.534 9.475 tion of $10,000, and must be nonnegotiable. Thrifts 9.830 9.800 9.693 9.784 9.725 3 For exceptions with respect to certain foreign time deposits see the FEDERAL RESERVE BULLETIN for October 1962 (p. 1279), August 1965 (p. 1094), and February 1968 (p. 167). 10 No separate account category. 4 A minimum of $1,000 is required for savings and loan associations, 11 Between July 1, 1973, and Oct. 31, 1973, there was no ceiling for except in areas where mutual savings banks permit lower minimum de- certificates maturing in 4 years or more with minimum denominations nominations. This restriction was removed for deposits maturing in less of $1,000; however, the amount of such certificates thai an institution than 1 year, effective Nov. 1, 1973. could issue was limited to 5 percent of its total time and savings deposits. 5 $1,000 minimum except for deposits representing funds contributed Sales in excess of that amount, as well as certificates of less than $1,000, to an Individual Retirement Account (IRA) or a Keogh (H.R. 10) Plan es- were limited to the 6l/z percent ceiling on time deposits maturing in 1l/i tablished pursuant to the Internal Revenue Code. The $1,000 minimum years or more. requirement was removed for such accounts in December 1975 and No- Effective Nov. 1, 1973, ceilings were reimposed on certificates maturing vember 1976, respectively. in 4 years or more with minimum denominations of $1,000. There is no 6 3-year minimum maturity. limitation on the amount of these certificates that banks can issue. 7 July 1, 1973, for mutual savings banks; July 6, 1973, for savings and loan associations. NOTE. Maximum rates that can be paid by federally insured commer- 8 Oct. 1, 1966, for mutual savings banks; Jan. 21, 1970, for savings and cial banks, mutual savings banks, and savings and loan associations are loan associations. established by the Board of Governors of the Federal Reserve System, 9 Commercial banks, savings and loan associations, and mutual savings the Board of Directors of the Federal Deposit Insurance Corporation, banks were authorized to offer money market time deposits effective and the Federal Home Loan Bank Board under the provisions of 12 June 1, 1978. The ceiling rate for commercial banks is the discount rate CFR 217, 329, and 526, respectively. The maximum rates on time deon most recently issued 6-month U.S. Treasury bills. The ceiling rate for posits in denominations of $100,000 or more were suspended in midsavings and loan associations and mutual savings banks is V4 percent 1973. For information regarding previous interest rate ceilings on all types of accounts, see earlier issues of the FEDERAL RESERVE BULLETIN, the Federal Home Loan Bank Board Journal, and the Annual Report of the Federal Deposit Insurance Corporation. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments All 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS Millions of dollars 1978 1976 1977 1978 Type of transaction June July Aug. Sept. Oct. Nov. Dec. U.S. GOVERNMENT SECURITIES Outright transactions (excluding matched salepurchase transactions) Treasury bills: 1 Gross purchases 14,343 13,738 16,628 4,395 701 972 2,635 1,978 2,039 0 2 Gross sales 8,462 7,241 13,725 0 466 689 0 2,148 3,587 2,751 3 Redemptions 2 5,017 2,136 2.033 0 0 0 0 0 603 0 Others within 1 year:1 4 Gross purchases 472 3,017 1,184 135 0 171 168 73 139 0 5 Gross sales 0 0 0 0 0 0 0 0 0 0 6 Exchange, or maturity shift 792 4,499 -5,170 -380 -241 -1,544 563 -385 -778 705 7 Redemptions 0 2,500 0 0 0 0 0 0 0 0 1 to 5 years: 8 Gross purchases 2 3,202 2,833 4,188 631 0 424 350 507 628 0 9 Gross sales 177 0 0 0 0 0 0 0 0 0 10 Exchange, or maturity shift -2,588 -6,649 -178 467 241 -490 -563 385 -657 -705 5 to 10 years: 11 Gross purchases 1,048 758 1,526 176 0 238 110 87 163 0 12 Gross sales 0 0 0 0 0 0 0 0 0 0 13 Exchange, or maturity shift 1,572 584 2,803 -87 0 1,434 0 0 835 0 Over 10 years: 14 Gross purchases 642 553 1,063 115 0 113 122 139 108 0 15 Gross sales 0 0 0 0 0 0 0 0 0 0 16 Exchange, or maturity shift 225 1,565 2,545 0 0 600 0 0 600 0 All maturities:1 17 Gross purchases 219,707 20,898 24,591 5,451 701 1,919 3,386 2,785 3,075 0 18 Gross sales 8,639 7,241 13,725 0 466 689 0 2,148 3,587 2,751 19 Redemptions 2 5,017 4,636 2,033 0 0 0 0 0 603 0 Matched sale-purchase transactions 20 Gross sales 196,078 425,214 511,126 52,544 44,657 29,162 33,346 35,112 40,785 52,661 21 Gross purchases 196,579 423,841 510,854 52,557 44,712 29,641 33,130 36,106 40,546 51,586 Repurchase agreements 22 Gross purchases 232,891 178,683 151,618 14,956 15,822 16,286 10,724 18,976 7,719 88,,113333 23 Gross sales 230,355 180,535 152,436 13,100 17,374 15,140 10,353 20,565 8,383 7,049 24 Net change in U.S. government securities 9,087 5,798 7,743 7,320 -1,261 2,854 3,540 43 -2,017 -2,743 FEDERAL AGENCY OBLIGATIONS Outright transactions: 25 Gross purchases 891 1,433 301 301 0 0 0 0 0 0 26 Gross sales 0 0 173 0 0 173 0 0 0 0 27 Redemptions 169 223 235 28 4 13 28 12 39 3 Repurchase agreements: 28 Gross purchases 10,520 13,811 40,567 3,421 5,170 3,080 3,877 6,675 22,,554444 44,,330077 29 Gross sales 10,360 13,638 40,885 3,088 5,457 3,032 3,348 7,196 2,670 4,174 30 Net change in federal agency obligations 882 1,383 -426 606 -291 -138 501 -533 -165 130 BANKERS ACCEPTANCES 31 Outrighttransactions.net -545 -196 0 0 0 0 0 0 0 0 32 Repurchase agreements, net 410 159 -366 747 -753 28 419 -479 -236 587 33 Net change in bankers acceptances -135 -37 -366 747 -753 28 419 -479 -236 587 34 Total net change in System Open Market Account 9,833 7,143 6,951 8,783 -2,305 2,744 4,460 -969 -2,419 -2,026 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 figuresi ncrease 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 Nonfinancial Statistics • February 1979 1.18 FEDERAL RESERVE BANKS Condition and F.R. Note Statements Millions of dollars Wednesday End of month Account 1979 1978 1979 Jan. 3 Jan. 10 Jan. 17 Jan. 24P Jan. 3If Nov. Dec. Jan.? Consolidated condition statement ASSETS 1 Gold certificate account 11,671 11,624 11,608 11,608 11,592 11,642 11,671 11,592 2 Special Drawing Rights certificate account 1,300 1,300 1,300 1,300 1,300 1,300 1,300 1,300 3 265 265 284 305 316 275 274 316 Loans: 4 Member bank borrowings 615 759 2,043 1,081 4,364 813 1,174 4,364 Other Acceptances: 6 7 330033 555888777 Federal agency obligations: 8 7,892 7,892 7,892 7,886 7,507 7,899 7,896 7,507 q 9 113333 U.S. government securities Bought outright: 10 Bills 3399,,443355 35,513 35,053 38,404 33,959 45,985 42,158 33,959 1? Other 13 54,855 54,855 54,855 54,855 54,855 54,855 54,855 54,855 14 12,465 12,465 12,465 12,465 12,465 12,465 12,465 12,465 15 Total i 106,755 102,833 102,373 105,724 101,279 113,305 109,478 101,279 16 141 1,084 17 Total U.S. government securities 106,896 102,833 102,373 105,724 101,279 113,305 110,562 101,279 18 Total loans and securities 115,715 111,484 112,308 114,691 113,150 122,017 120,352 113,150 19 Cash items in process of collection 20,561 17,110 23,490 15,918 13,452 13,165 12,926 13,452 20 394 396 396 395 395 396 394 395 Other assets: 21 Denominated in foreign currencies2 1,487 1,477 1,462 1,355 2,528 53 1,606 2,528 22 All other 2,534 2,391 2,820 2,644 2,753 1,901 2,543 2,753 23 153,927 146,047 153,668 148,216 145,486 150,749 151,066 145,486 LIABILITIES 24 Federal Reserve notes 103,449 102,137 100,952 99,830 99,354 100,825 103,325 99,354 Deposits: 25 Member bank reserves 32,921 29,600 35,900 32,688 30,578 31,919 3311,,115522 30,578 26 U.S. Treasury—General account 3,578 2,286 3,061 3,432 3,522 6,587 4,196 3,522 27 270 234 316 291 339 379 368 339 28 Other 754 653 712 853 874 567 1,256 874 29 37,523 32,773 39,989 37,264 35,313 39,452 36,972 35,313 30 Deferred availability cash items 8,786 6,792 8,185 6,526 6,225 5,927 6,494 6,225 31 Other liabilities and accrued dividends 1,932 1,956 1,986 1,875 1,685 1,725 2,119 1,685 32 Total liabilities 151,690 143,658 151,112 145,495 142,577 147,929 148,910 142,577 CAPITAL ACCOUNTS 33 1,079 1,079 1,082 1,085 1,085 1,073 1,078 1,085 34 1,078 1,078 1,078 1,078 1,078 1,029 1,078 • 1,078 35 Other capital accounts 80 232 396 558 746 718 746 36 Total liabilities and capital accounts 153,927 146,047 153,668 148,216 145,486 150,749 151,066 145,486 37 MEMO: Marketable U.S. govt, securities held in custody for foreign and intl. account 96,405 96,799 96,732 95,794 95,762 92,412 95,307 95,762 Federal Reserve note statement 38 F.R. notes outstanding (issued to Bank) 112,878 113,078 113,493 113,806 113,618 112,445 112,836 113,618 Collateral held against notes outstanding: 39 Gold certificate account 11,671 11,624 11,608 11,608 11,592 11,642 1111,,667711 1111,,559922 40 Special Drawing Rights certificate account.... 1,300 1,300 1,300 1,300 1,300 1,300 1,300 1,300 41 Eligible paper 536 672 1,568 924 2,726 692 907 2,726 42 99,371 99,482 99,017 99,974 98,000 98,811 98,958 98,000 43 112,878 113,078 113,493 113,806 113,618 112,445 112,836 113,618 1 Includes securities loaned—fully guaranteed by U.S. govt, securities 2 Beginning December 29, 1978, such assets are revalued monthly pledged with Federal Reserve Banks—and excludes (if any) securities sold at market exchange rates, and scheduled to be bought back under matched sale-purchase transactions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Reserve Banks A13 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holdings Millions of dollars Wednesday End of month TTTyyypppeee aaannnddd mmmaaatttuuurrriiitttyyy 1979 1978 1979 Jan. 3 Jan. 10 Jan. 17 Jan. 24 Jan. 31 Nov. 30 Dec. 31 Jan. 31 ! 617 759 2,047 1.081 4,364 812 1,172 4,364 2 Within 15 days 585 712 2,023 i;o6i 4,334 767 1,142 4,334 3 16 days to 90 days 32 47 24 20 30 45 30 30 4 91 Havs to 1 vear S Arrontanrcs 303 587 6 Within 15 days 330033 558877 7 16 days to 90 days 88 91 days to 1 year 9 U.S. government securities 106,896 102,833 102,373 105,724 101,279 113,305 110,562 101,279 10 Within 15 days1 3,323 4,129 2,311 2,914 3,961 4,467 4,297 3,961 11 16 days to 90 days 18,033 12,605 14,717 18,325 14,369 20,315 19,800 14,369 12 91 days to 1 year 28,358 28,916 28,162 27,302 25,980 31,523 29,465 25,980 13 Over 1 year to 5 years 31,790 31,791 31,791 31,791 31,577 31,608 31,608 31,577 14 Over 5 years to 10 years 14,717 14,717 14,717 14,717 14,717 14,717 14,717 14,717 15 Over 10 years 10,675 10,675 10,675 10,675 10,675 10,675 10,675 10,675 16 Federal agency obligations 7,901 7,892 7,892 7,886 7,507 7,899 8,029 7,507 17 Within 15 days1 9 56 73 17 16 135 217 16 18 16 days to 90 days 507 451 434 494 507 438 482 507 19 91 days to 1 year 1,388 1,388 1,388 1,369 1,188 1,292 1,286 1,188 20 Over 1 year to 5 years 3,676 3,676 3,676 3,685 3,475 3,686 3,723 3,475 21 Over 5 years to 10 years 1,511 1,511 1,511 1,511 1,511 1,488 1,511 1,511 22 Over 10 years 810 810 810 810 810 860 810 810 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 of dollars, turnover as ratio of debits to deposit. Monthly data are at annual rates. 1978 BBaannkk ggrroouupp,, oorr ttyyppee 11997755 11997766 11997777 ooff ccuussttoommeerr Aug.r Sept.' Oct.r Nov.r Dec. Debits to demand deposits 2 (seasonally adjusted) 1111 AAAAllllllll ccccoooommmmmmmmeeeerrrrcccciiiiaaaallll bbbbaaaannnnkkkkssss 25,028.5 29,180.4 34,322.8 42,819.1 41,896.6 42,942.5 42.941.5 42,307.5 2222 MMMMaaaajjjjoooorrrr NNNNeeeewwww YYYYoooorrrrkkkk CCCCiiiittttyyyy bbbbaaaannnnkkkkssss.... .... 9,670.7 11,467.2 13,860.6 16.435.0 15,500.0 15,437.8 15.673.6 15.100.2 3333 OOOOtttthhhheeeerrrr bbbbaaaannnnkkkkssss 15,357.8 17,713.2 20,462.2 26.384.1 26,396.6 27,504.7 27,267.9 27.207.3 Debits to savings deposits 3 (not seasonally adjusted) 4444 AAAAllllllll ccccuuuussssttttoooommmmeeeerrrrssss 117744..00 443344..66 442244..44 446677..66 444466..00 443388..00 5555 BBBBuuuussssiiiinnnneeeessssssss 1111 2211..77 5588..55 6622..00 6677..22 6666..88 6611..44 6666 OOOOtttthhhheeeerrrrssss 115522..33 337766..11 336622..44 440000..44 337799..11 337766..66 Demand deposit turnover 2 (seasonally adjusted) 77777 AAAAAllllllllll cccccooooommmmmmmmmmeeeeerrrrrccccciiiiiaaaaalllll bbbbbaaaaannnnnkkkkksssss 105.3 116.8 129.2 146.5 141.9 144.1 145.1 141.6 88888 MMMMMaaaaajjjjjooooorrrrr NNNNNeeeeewwwww YYYYYooooorrrrrkkkkk CCCCCiiiiitttttyyyyy bbbbbaaaaannnnnkkkkksssss.......... 356.9 411.6 503.0 577.6 549.6 530.1 559.8 535.9 99999 OOOOOttttthhhhheeeeerrrrr bbbbbaaaaannnnnkkkkksssss 72.9 79.8 85.9 100.0 98.8 102.3 101.8 100.5 Savings deposit turnover 3 (not seasonally adjusted) 1111100000 AAAAAllllllllll cccccuuuuussssstttttooooommmmmeeeeerrrrrsssss 11..66 22..00 11..99 22..11 22..00 22..00 1111111111 BBBBBuuuuusssssiiiiinnnnneeeeessssssssss 11111 44..11 55..22 55..44 55..88 55..88 55..44 1111122222 OOOOOttttthhhhheeeeerrrrrsssss 11..55 11..88 11..77 11..99 11..88 11..88 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 SMS As, 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.D. 20551. Debits and turnover data and of states and political subdivisions. for savings deposits are not available prior to July 1977. 3 Excludes negotiable order 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 NonfinancialS tatistics • February 1979 1.21 MONEY STOCK MEASURES AND COMPONENTS Billions of dollars, averages of daily figures 1978 1975 1976 1977 1978 Dec.r Dec.r Dec.r Dec. Item July' Aug. r Sept. r Oct.r Nov.r Dec. Seasonally adjusted MEASURES i 1 M-l 295.4 313.8 338.7 361.5 354.5 357.0 361.1 361.6 361.0 361.5 2 M-l + 456.8 517.2 560.6 586.7 580.0 583.5 589.4 589.8 587.4 586.7 3 M-2 664.8 740.6 809.4 876.3 848.7 856.9 866.2 870.9 874.3 876.3 4 M-3 1,092.4 1,235.6 1,374.3 1,500.9 1,444.6 1,458.4 1,474.7 1,485.6 1,493.9 1,500.9 5 M-4 745.8 803.0 883.1 973.0 936.7 944.5 954.8 959.6 969.7 973.0 6 M-5 1,173.5 1,298.0 1,448.0 1,597.5 1,532.6 1,546.0 1,563.2 1,574.2 1,589.3 1,597.5 COMPONENTS 7 Currency 73.8 80.8 88.6 97.5 93.2 93.9 95.2 95.8 96.6 97.5 Commercial bank deposits: 8 Demand 221.7 233.0 250.1 264.1 261.3 263.0 265.9 265.8 264.4 264.1 9 Time and savings 450.3 489.2 544.4 611.4 582.2 587.5 593.7 597.9 608.7 611.4 10 Savings 160.7 202.1 219.7 220.0 222.8 223.7 225.5 225.2 223.4 220.0 11 Negotiable CDs2 81.0 62.4 73.7 96.6 88.0 87.6 88.5 88.6 95.4 96.6 12 Other time 208.6 224.7 251.0 292.8 271.4 276.2 279.6 284.1 289.9 292.8 13 Nonbank thrift institutions3 All .1 495.0 544.4 611.4 582.2 587.5 593.7 597.9 608.7 611.4 Not seasonally adjusted MEASURES 1 14 M-l 303.9 322.6 348.2 371.6 356.3 354.4 359.0 361.4 363.0 371.6 15 M-l + 463.6 524.2 568.0 594.7 583.7 580.9 585.4 587.9 587.6 594.7 16 M-2 670.0 745.8 814.9 882.0 851.4 853.8 861.7 868.2 871.6 882.0 17 M-3 1,095.0 1,238.3 1,377.2 1,503.6 1,450.2 1,455.5 1,469.2 1,481.6 1,487.9 1,503.6 18 M-4 753.5 810.0 890.8 981.6 938.8 941.8 952.0 959.0 968.0 981.6 19 M-5 1,178.4 1,302.6 1,453.2 1,603.1 1,537.6 1,543.5 1,559.5 1,572.5 1,584.3 1,603.1 COMPONENTS 20 Currency 69.0 75.1 82.1 90.1 93.9 94.2 94.9 95.6 97.2 99.1 Commercial bank deposits: 21 Demand 222.2 228.8 240.5 258.1 262.4 260.2 264.1 265.8 265.7 272.5 22 Member 159.7 162.8 169.4 177.5 177.9 176.2 178.3 179.3 178.3 182.9 23 Domestic nonmember 58.5 62.6 67.5 76.2 80.5 80.1 81.9 82.7 83.7 85.6 24 Time and savings 416.7 449.6 487.4 542.6 582.4 587.5 593.1 597.6 605.0 609.9 25 Savings 134.5 159.1 200.2 111 .1 224.7 223.7 223.6 223.5 221.5 219.9 26 Negotiable CDs2 90.5 83.5 64.3 75.9 87.3 88.0 90.3 90.8 96.4 99.5 27 Other time 207.1 222.9 249.0 290.5 270.5 275.7 279.2 283.3 287.1 290.5 28 Other checkable deposits4 0.4 0.7 1.4 2.1 2.7 2.8 2.8 2.9 3.1 3.2 29 Nonbank thrift institutions3 366.3 424.9 492.5 562.3 598.8 601.7 607.5 613.4 616.3 621.6 30 U.S. government deposits (all commerical banks) 4.9 4.1 4.4 5.1 4.5 3.6 6.2 4.3 8.0 10.2 1 Composition of the money stock measures is as follows : of mutual savings banks, savings and loan shares, and credit union shares (nonbank thrift). M-l: Averages of daily figures for (1) demand deposits at commercial M-4: M-2 plus large negotiable CDs. banks other than domestic interbank and U.S. government, less cash items M-5: M-3 plus large negotiable CDs. in process of collection and Federal Reserve float; (2) foreign demand 2 Negotiable time CDs issued in denominations of $100,000 or more balances at Federal Reserve Banks; and (3) currency outside the Treasury, by large weekly reporting commercial banks. Federal Reserve Banks, and vaults of commercial banks. 3 Average of the beginning- and end-of-month figures for deposits of M-l + : M-l plus savings deposits at commercial banks, NOW accounts mutual savings banks, for savings capital at savings and loan associations, at banks and thrift institutions, credit union share draft accounts, and and for credit union shares. demand deposits at mutual savings banks. 4 Includes NOW accounts at thrift institutions, credit union share M2-: M-l plus savings deposits, time deposits open account, and time draft accounts, and demand deposits at mutual savings banks. certificates of deposit (CDs) other than negotiable CDs of $100,000 or more at large weekly reporting banks. NOTE. Latest monthly and weekly figures are available from the board's M-3: M-2 plus the average of the beginning- and end-of-month deposits 508 (H.6) release. Back data are available from the Banking Section, Division of Research and Statistics. NOTES TO TABLE 1.23: 1 Adjusted to exclude domestic commercial interbank loans. of one large bank. Reductions in other items were: "Total loans," $1.0 2 Loans sold are those sold outright to a bank's own foreign branches, billion (of which $0.6 billion was in "Commercial and industrial loans"), nonconsolidated nonbank affiliates of the bank, the bank's holding and "Other securities," $0.5 billion. In late November "Commercial and company (if not a bank), and nonconsolidated nonbank subsidiaries of industrial loans" were increased by $0.1 billion as a result of loan rethe holding company. Prior to Aug. 28, 1974, the institutions included classifications at another large bank. had been defined somewhat differently, and the reporting panel of banks 4 Reclassification of loans reduced these loans by about $1.2 billion was also different. On the new basis, both "Total loans" and "Com- as of Mar. 31, 1976. merical and industrial loans" were reduced by about $100 million. 5 Reclassification of loans at one large bank reduced these loans by 3 Data beginning June 30, 1974, include one large mutual savings about $200 million as of Dec. 31, 1977. bank that merged with a nonmember commercial bank. As of that date there were increases of about $500 million in loans, $100 million in NOTE. Data are for last Wednesday of month except for June 30 and "Other" securities and $600 million in "Total loans and investments." Dec. 31; data are partly or wholly estimated except when June 30 and As of Oct. 31, 1974, "Total loans and investments" of all commercial Dec. 31 are call dates. banks were reduced by $1.5 billion in connection with the liquidation 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 1978 IItteemm 11997755 11997766 11997777 DDeecc.. DDeecc.. DDeecc.. May June July Aug. Sept. Oct. Nov. Dec. Seasonally adjusted 1111 RRRReeeesssseeeerrrrvvvveeeessss1111 34.67 34.89 36.10 37.27 37.63 38.11 37.93 38.21 38.38 39.75 41.27 2222 NNNNoooonnnnbbbboooorrrrrrrroooowwwweeeedddd 34.54 34.84 35.53 36.06 36.53 36.80 36.79 37.15 37.10 39.05 40.40 3333 RRRReeeeqqqquuuuiiiirrrreeeedddd 34.40 34.61 35.91 37.05 37.45 37.92 37.77 38.02 38.22 39.53 41.04 4444 DDDDeeeeppppoooossssiiiittttssss ssssuuuubbbbjjjjeeeecccctttt ttttoooo rrrreeeesssseeeerrrrvvvveeee rrrreeeeqqqquuuuiiiirrrreeeemmmmeeeennnnttttssss2222 504.2 528.6 568.6 591.5 595.8 600.5 602.7 607.0 608.9 616.9 616.7 5555 TTTTiiiimmmmeeee aaaannnndddd ssssaaaavvvviiiinnnnggggssss 336.8 354.1 386.7 405.1 407.4 410.8 413.0 416.8 418.3 427.5 429.4 DDDDeeeemmmmaaaannnndddd:::: 6666 PPPPrrrriiiivvvvaaaatttteeee 164.5 171.5 178.5 183.6 184.6 186.1 186.5 186.2 187.2 187.0 185.1 7777 UUUU....SSSS.... GGGGoooovvvveeeerrrrnnnnmmmmeeeennnntttt 2.9 3.0 3.5 2.7 3.8 3.6 3.3 4.0 3.5 2.3 2.3 Not seasonally adjusted 8888 DDDDeeeeppppoooossssiiiittttssss ssssuuuubbbbjjjjeeeecccctttt ttttoooo rrrreeeesssseeeerrrrvvvveeee rrrreeeeqqqquuuuiiiirrrreeeemmmmeeeennnnttttssss2222 510.9 534.8 575.3 588.3 596.8 600.6 599.2 605.9 608.4 r615.1 624.0 9999 TTTTiiiimmmmeeee aaaannnndddd ssssaaaavvvviiiinnnnggggssss 337.2 353.6 386.4 406.1 408.6 411.1 412.8 416.6 418.5 425.2 429.6 DDDDeeeemmmmaaaannnndddd:::: 11110000 PPPPrrrriiiivvvvaaaatttteeee 170.7 177.9 185.1 179.3 183.7 186.4 183.9 184.7 186.9 r188.0 191.9 11111111 UUUU....SSSS.... GGGGoooovvvveeeerrrrnnnnmmmmeeeennnntttt 3.1 3.3 3.8 2.9 4.5 3.2 2.5 4.6 3.0 2.0 2.5 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, collection and demand balances due from domestic commercial banks. 1976. 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 qn 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 1978 1974 1975 1976 1977 CCaatteeggoorryy Dec. 313 Dec. 31 Dec. 31 Dec. 31 July 26* Aug. 30* Sept. 27* Oct. 25* Nov. 29 * Dec. 31* Seasonally adjusted 1 Loans and investments1 691.1 721.8 785.1 870.6 940.7 944.6 952.4 960.9 966.5 967.3 2 Including loans sold outright2. ... 695.9 726.2 788.9 875.5 945.3 949.3 957.0 964.8 970.2 971.1 Loans: 3 Total 500.2 496.9 538.9 617.0 675.1 680.2 687.3 696.8 706.8 709.0 4 Including loans sold outright2... 505.0 501.3 542.7 621.9 679.7 684.9 691.9 700.7 710.5 712.8 5 Commercial and industrial 183.5 176.2 4179.7 5201.4 220.8 222.8 224.6 227.0 228.9 228.9 6 Including loans sold outright2... 186.2 178.7 4182.1 5204.2 223.1 225.2 226.9 228.9 230.8 230.7 Investments: 7 U.S. Treasury 51.1 80.1 98.0 95.6 100.6 97.9 97.2 95.2 90.3 88.4 8 Other 139.8 144.8 148.2 158.0 165.0 166.5 167.9 168.9 169.4 169.9 Not seasonally adjusted 9 Loans and investments1 705.6 737.0 801.6 888.9 936.6 942.0 951.4 958.4 969.3 987.6 10 Including loans sold outright2 710.4 741.4 805.4 893.8 941.2 946.7 956.1 962.3 973.0 991.4 Loans: 11 Total i 510.7 507.4 550.2 629.9 675.6 681.0 688.6 696.6 707.2 723.9 12 Including loans sold outright2... 515.5 511.8 554.0 634.8 680.2 685.7 693.3 700.5 710.9 727.7 13 Commercial and industrial 186.8 179.3 4182.9 5205.0 220.9 221.7 223.9 226.5 228.9 233.0 14 Including loans sold outright2... 189.5 181.8 4185.3 5207.8 232.2 224.1 226.2 228.4 230.8 234.8 Investments: 15 U.S. Treasury 54.5 84.1 102.5 100.2 96.1 94.8 95.0 93.5 92.6 93.0 16 Other 140.5 145.5 148.9 158.8 164.9 166.2 167.7 168.3 169.5 170.7 For notes see bottom of opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Nonfinancial Statistics • February 1979 1.24 COMMERCIAL BANK ASSETS AND LIABILITIES Last-Wednesday-of-Month Series Billions of dollars except for number of banks 1977 19783 Account Dec. Mar. Apr. May June July* Aug." Sept.? Oct.* Nov." Dec." All commercial 1 Loans and investments 939.1 939.7 953.0 974.4 985.0 980.6 985.5 996.4 1,003.0 1,016.2 1,034.7 2 Loans, gross 680.1 680.4 688.7 712.4 722.1 719.6 724.5 733.6 774411..22 775544..11 777700..99 Investments: 3 U.S. Treasury securities.. 100.2 99.0 100.2 97.3 97.9 96.1 94.8 95.0 93.5 92.6 92.6 4 Other 158.8 160.3 164.1 164.6 165.1 164.9 166.2 167.7 168.3 169.5 171.2 5 Cash assets 168.7 130.5 133.1 161.0 166.8 130.2 137.4 141.8 146.5 149.2 170.1 6 Currency and coin 13.9 14.4 14.3 14.5 12.0 14.8 15.2 15.2 15.1 16.7 17.2 7 Reserves with F.R. Banks... 29.3 30.2 27.6 30.3 29.6 23.6 29.7 32.6 34.6 32.6 37.7 8 Balances with banks 59.0 42.6 43.6 51.9 56.0 44.4 43.0 44.4 45.0 46.5 51.6 9 Cash items in process of collection.. 66.4 43.3 47.6 64.3 69.3 47.3 49.5 49.6 51.7 53.5 63.6 10 Total assets/total liabilities and capital1 1,166.0 1,140.5 1,156.9 1,206.5 1,215.0 1,179.2 1,192.9 1,209.5 1,220.4 1,240.8 1,284.0 11 Deposits 939.4 899.8 915.5 952.9 965.7 932.3 937.7 949.9 952.3 959.0 993.1 12 Interbank 51.7 37.6 39.0 51.2 49.3 40.5 40.4 41.9 43.3 42.9 51.1 13 U.S. government 7.3 4.9 6.2 3.3 8.0 4.3 2.8 11.0 7.6 2.1 2.3 14 Other. 323.9 281.2 293.8 312.9 317.5 296.3 298.6 297.1 299.2 304.7 327.1 15 Interbank 9.8 9.0 9.0 9.4 10.2 10.3 10.7 11.6 11.1 11.8 12.4 16 Other 546.6 567.1 567.5 576.1 580.8 580.9 585.2 588.3 591.2 597.6 600.3 17 Borrowings 96.2 105.6 104.9 112.2 106.8 103.2 109.1 112.8 118.3 125.6 133.0 18 Total capital accounts2 85.8 83.4 83.7 84.6 89.9 85.8 86.2 87.1 87.1 87.8 87.3 19 MEMO: Number of banks 14,707 14,689 14,697 14,702 14,698 14,713 14,721 14,715 14,713 14,719 14,719 Member 20 Loans and investments 675.5 668.6 676.8 693.8 699.7 695.8 698.9 706.9 713.4 724.3 739.5 21 Loans, gross 494.9 490.5 495.3 514.3 519.6 517.6 520.3 527.0 553333..99 554444..66 555588..33 Investments: 22 U.S. Treasury securities... 70.4 68.2 68.8 66.9 67.4 65.7 65.3 65.4 64.1 63.5 63.6 23 Other 110.1 109.9 112.7 112.7 112.7 112.5 113.3 114.5 115.3 116.2 117.6 24 Cash assets, total 134.4 104.8 106.5 130.7 133.8 104.2 111.2 115.4 118.6 121.3 140.2 25 Currency and coin 10.4 10.6 10.5 10.6 8.7 10.8 11.1 11.1 11.1 12.3 12.7 26 Reserves with F.R. Banks. .. 29.3 30.2 27.6 30.3 29.6 23.6 29.7 32.6 34.6 32.6 37.7 27 Balances with banks 30.8 22.9 22.7 28.1 29.1 24.3 22.9 24.0 23.2 25.1 28.6 28 Cash items in process of collection.. 63.9 41.2 45.7 61.7 66.5 45.4 47.6 47.7 49.7 51.4 61.2 29 Total assets/total liabilities and capital 1 861.8 833.2 843.3 884.7 888.7 857.3 868.5 882.2 891.2 908.5 945.2 30 Deposits 683.5 645.1 655.1 686.7 694.3 666.1 670.6 679.6 682.5 668888..66 771166..33 Demand: 31 48.0 34.7 36.0 47.5 45.5 37.3 37.2 38.6 39.9 39.5 47.3 32 U.S. government 5.4 3.7 4.5 2.2 5.6 3.1 1.9 8.1 5.7 1.5 1.6 33 Other 239.4 205.1 213.4 229.1 231.6 214.6 217.0 215.6 217.0 222211..33 223377..99 Time: 34 Interbank 7.8 7.0 6.9 7.3 8.1 8.2 8.6 9.4 9.0 9.7 10.2 35 Other 382.9 394.7 394.3 400.5 403.4 402.9 405.9 407.8 411.0 416.7 419.3 3 3 6 7 B T o o r ta r l o w ca in p g it s a l accounts2 6 8 3 4 . . 7 9 9 6 1 2 . . 8 4 9 6 1 2 . . 1 7 9 6 6 3 . . 9 3 9 6 2 6 . . 1 1 6 8 4 8 . . 2 0 9 6 3 4 . . 9 5 9 65 7 . . 1 2 1 6 0 5 1 . . 2 4 1 6 0 5 8 . . 7 1 1 6 1 5 5 . . 5 9 38 MEMO: Number of banks 5,669 5,654 5,645 5,638 5,622 5,613 5,610 5,593 5,585 5,586 5,586 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. against "other assets," and against "total assets" as well. Member banks: The following numbers of noninsured trust companies Total liabilities continue to include the deferred income tax portion of that are members of the Federal Reserve System are excluded from mem- "reserve for loan losses." ber banks in tables 1.24 and 1.25 and are included with noninsured banks 2 Effective Mar. 31, 1976, includes "reserves for securities" and the in table 1.25: 1976—December, 11; 1978—January, 12. contingency portion (which is small) of "reserve for loan losses." 3 Figures partly estimated except on call dates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks All 1.25 COMMERCIAL BANK ASSETS AND LIABILITIES Call-Date Series Millions of dollars, except for number of banks 1976 1977 1978 1976 1977 1978 Account Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Total insured National (all insured) 1 882277,,669966 885544,,773333 991144,,777799 995566,,443311 447766,,661100 488,240 552233,,000000 554422,,221188 Loans: 2 Gross 578,734 601,122 657,509 695,443 340,691 351,311 384,722 403,812 3 Net 556600,,007777 558811,,114433 636,318 672,207 329,971 339,955 372,702 390,630 Investments: 4 U.S. Treasury securities 101,461 100,568 99,333 97,001 55,727 53,345 52,244 50,519 5 Other 147,500 153,042 157,936 163,986 80,191 83,583 86,033 87,886 6 129,562 130,726 159,264 157,393 76,072 74,641 92,050 90,728 7 Total assets/total liabilities1 1,003,970 1,040,945 1,129,712 1,172,772 583,304 599,743 651,360 671,166 8 Deposits 882255,,000033 884477,,337722 992222,,665577 945,874 469,377 476,381 552200,,116677 552266,,993322 Demand: 9 U.S. government 3,022 2,817 7,310 7,956 1,676 1,632 4,172 4,483 10 Interbank 44,064 44,965 49,843 47,203 23,149 22,876 25,646 22,416 11 Other 228855,,220000 284,544 331199,,887733 331122,,770077 163,346 116611,,335588 118811,,882211 117766,,002255 Time: 12 Interbank 8,248 7,721 8,731 8,987 4,907 4,599 5,730 5,791 13 Other 484,467 507,324 536,899 569,020 276,296 285,915 302,795 318,215 14 Borrowings 75,291 81,137 89,339 98,351 54,421 57,283 63,218 68,948 15 Total capital accounts 72,061 75,502 79,082 83,074 41,319 43,142 44,994 47,019 16 MEMO: Number of banks 14,397 14,425 14,397 14,381 4,735 4,701 4,654 4,616 State member (all insured) Insured nonmember 17 Loans and investments, gross 114444,,000000 114444,,559977 152,514 157,464 220077,,008855 221,896 239,265 256,749 Loans: 18 Gross 102,277 102,117 110,243 115,736 135,766 147,694 162,543 175,894 19 Net 9999,,447744 99,173 110077,,220055 112,470 130,630 142,015 156,411 169,106 Investments: 20 U.S. Treasury securities 18,849 19,296 18,179 16,886 26,884 27,926 28,909 29,595 21 Other 22,874 23,183 24,091 24,841 44,434 46,275 47,812 51,259 22 Cash assets 32,859 35,918 42,305 43,057 20,631 20,166 24,908 23,606 23 189,579 195,452 210,442 217,384 231,086 245,748 267,910 284,221 24 114499,,449911 115522,,447722 163,436 167,403 206,134 218,519 239,053 251,539 Demand: 25 429 371 1,241 1,158 917 813 1,896 2,315 26 Interbank 19,295 20,568 22,346 23,117 1,619 1,520 1,849 1,669 27 Other 52,204 5522,,557700 57,605 55,550 69,648 70,615 80,445 81,131 Time: 28 Interbank 2,384 2,134 2,026 2,275 956 988 973 920 29 Other 75,178 76,827 80,216 85,301 132,993 144,581 153,887 165,502 30 Borrowings 17,310 19,697 21,736 23,167 3,559 4,155 4,384 6,235 31 13,199 13,441 14,182 14,670 17,542 18,919 19,905 21,384 32 MEMO: Number of banks 1,023 1,019 1,014 1,005 8,639 8,705 8,729 8,760 Noninsured nonmember Total nonmember 33 1188,,881199 2222,,994400 2244,,441155 28,699 225,904 244,837 263,681 285,448 Loans: 34 Gross 16,336 20,865 22,686 26,747 152,103 168,559 185,230 202,641 35 Net 1166,,220099 20,679 22,484 26,548 146,840 162,694 178,896 195,655 Investments: 36 U.S. Treasury securities 1,054 993 879 869 27,938 28,919 29,788 30,465 37 Other 1,428 1,081 849 1,082 45,863 47,357 48,662 52,341 38 Cash assets 6,496 8,330 9,458 9,360 27,127 28,497 34,367 32,967 39 Total assets/total liabilities1 26,790 33,390 36,433 42,279 257,877 279,139 304,343 326,501 40 1133,,332255 1144,,665588 16,844 19,924 219,460 233,177 255,898 271,463 Demand: 41 4 8 10 8 921 822 1,907 2,323 42 1,277 1,504 1,868 2,067 2,896 3,025 3,718 3,736 43 Other 33,,223366 3,588 4,073 4,814 72,884 74,203 84,518 85,946 Time: 44 1,041 1,164 1,089 1,203 1,997 2,152 2,063 2,123 45 Other 7,766 8,392 9,802 11,831 140,760 152,974 163,690 177,334 46 4,842 7,056 6,908 8,413 8,401 11,212 11,293 14,649 47 Total capital accounts 818 893 917 962 18,360 19,812 20,823 22,346 48 MEMO: Number of banks 275 293 310 317 8,914 8,998 9,039 9,077 1 Includes items not shown separately. For Note see Table 1.24. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A18 DomesticN onfinancial Statistics • February 1979 1.26 COMMERCIAL BANK ASSETS AND LIABILITIES Detailed Balance Sheet, June 30, 1978 Millions of dollars, except for number of banks. Member banks1 All Insured Asset account commercial commercial Large banks banks banks Total All other New York City of Other City Chicago large2 1 Cash bank balances, items in process 166,754 157,393 133,786 40,354 5,594 48,783 39,054 2 Currency and coin 11,950 11,883 8,691 795 190 2,878 4,828 3 Reserves with Federal Reserve Banks 29,574 29,566 29,566 4,104 1,537 12,499 11,426 4 Demand balances with banks in United States 43,092 38,158 23,166 10,382 248 3,539 8,996 5 Other balances with banks in United States... 6,779 5,007 2,775 520 5 782 1,468 6 Balances with banks in foreign countries 6,093 3,588 3,110 439 384 1,484 803 7 Cash items in process of collection 69,266 69,192 66,478 24,113 3,231 27,602 11,533 8 Total securities held—Book value 261,272 259,360 178,753 20,609 7,979 57,297 92,868 9 U.S. Treasury 97,872 97,002 67,406 9,623 2,955 22,215 32,613 10 Other U.S. government agencies 39,847 39,486 25,193 1,800 1,353 7,362 14,678 11 States and political subdivisions 117,257 117,018 82,541 8,881 3,480 26,626 43,554 12 All other securities 6,204 5,767 3,549 305 191 1,071 1,981 13 Unclassified total 92 64 23 41 14 Trading-account securities 7,160 7,156 7,010 3,026 978 2,756 251 15 U.S. Treasury 4,062 4,062 4,044 1,907 713 1,352 72 16 Other U.S. government agencies 986 986 976 428 80 423 45 17 States and political subdivisions 1,676 1,676 1,657 610 133 824 90 18 All other trading account securities 345 345 270 82 52 133 3 19 Unclassified 92 64 23 41 20 Bank investment portfolios 254,112 252,204 171,743 17,583 7,002 54,541 92,617 21 U.S. Treasury 93,810 92,940 63,362 7,716 2,242 20,863 32,541 22 Other U.S. government agencies 38,861 38,499 24,217 1,373 1,273 6,939 14,633 23 States and political subdivisions 115,582 115,343 80,884 8,271 3,347 25,802 43,464 24 All other portfolio securities 5,859 5,422 3,279 223 139 938 1,979 25 Federal Reserve stock and corporate stock 1,669 1,628 1,380 309 105 491 475 26 Federal funds sold and securities resale agreement. 48,576 43,768 34,495 ,309 1,616 17,935 10,636 27 Commercial banks 41,068 36,621 27,517 ,321 1,300 13,9Q6 9,899 28 Brokers and dealers 4,962 4,954 4,847 ,514 235 2,528 569 29 Others 2,546 2,193 2,131 474 80 1,411 167 30 Other loans, gross 673,615 651,675 485,054 76,423 25,479 184,099 199,053 31 LESS: Unearned income on loans 16,142 16,086 10,768 620 104 3,521 6,524 32 Reserves for loan loss 7,293 7,150 5,680 1,297 325 2,155 1,902 33 Other loans, net 650,180 628,439 468,606 74,506 25 049 178,424 190,628 Other loans, gross, by category 34 Real estate loans 192,877 192,609 131,891 9,629 2,678 49,324 70,260 35 Construction and land development 23,658 23,639 17,684 2,391 630 8,586 6,076 36 Secured by farmland 8,208 8,189 3,565 23 8 405 3,129 37 Secured by residential properties 110,293 110,113 76,832 4,891 1,426 28.984 41,531 38 1- to 4-family residences 104,952 104,793 72,964 4,209 1,331 27,608 39,816 39 FHA-insured or VA-guaranteed 7,496 7,423 6,430 519 42 3,395 2,474 40 Conventional 97,457 97,370 66,534 3,690 1,289 24,213 37,342 41 Multifamily residences 5,341 5,320 3,869 683 95 1,376 1,714 42 FHA-insured 399 395 327 120 25 87 96 43 Conventional 4,941 4,926 3,541 563 70 1,289 1,619 44 Secured by other properties 50,719 50,667 33,810 2,324 614 11,349 19,523 45 Loans to financial institutions 44,426 35,472 33,355 11,483 4,015 14.985 2,873 46 REITs and mortgage companies 8,348 8,341 7,949 2,114 812 4,369 654 47 Domestic commercial banks 5,263 3,116 2,398 702 123 1,307 265 48 Banks in foreign countries 12,864 6,610 6,447 2,931 272 2,648 596 49 Other depositary institutions 1,480 1,458 1,312 240 53 775 245 50 Other financial institutions 16,471 15,948 15,249 5,496 2,755 5,886 1, 13 51 Loans to security brokers and dealers 11,716 11,340 11,043 6,567 1,457 2,706 313 52 Other loans to purchase or carry securities 4,425 4,337 3,604 403 294 1,896 1,011 53 Loans to farmers—except real estate 27,018 26,993 14,813 161 178 3,630 10,844 54 Commercial and industrial loans 221,591 210,907 170,678 38,588 13,149 67,555 51,387 55 Loans to individuals 153,582 153,458 105,611 6,686 2,334 37,998 58,592 56 Installment loans 124,139 124,066 85.515 5,041 1,505 31,323 47,646 57 Passenger automobiles 55,757 55,740 35,523 994 179 10,746 23,605 58 Residential repair and modernization 7,956 7,955 5,203 305 77 1,912 2,909 59 Credit cards and related plans 20,136 20,125 17,766 2,214 1,068 9,069 5,414 60 Charge-account credit cards 16,185 16,184 14.516 1,424 1,027 7,617 4,449 61 Check and revolving credit plans 3,951 3,941 3,249 791 41 1,453 965 62 Other retail consumer goods 18,752 18,747 12,722 395 54 4,843 7,430 63 Mobile homes 9,387 9,387 6,553 171 19 2,471 3,892 64 Other 9,365 9,360 6,169 225 35 2,372 3,537 65 Other installment loans 21,539 21,498 14,301 1,132 128 4,752 8,288 66 Single-payment loans to individuals 29,443 29,392 20,096 1,646 829 6,675 10,946 67 All other loans 17,979 16,559 14,059 2,906 1,373 6,005 3,774 68 Total loans and securities, net 961,697 933,196 683,234 99,732 34,749 254,146 294,607 69 Direct lease financing 6,303 6,302 5,918 1,106 98 3,669 1,045 70 Fixed assets—Buildings, furniture, real estate... 22,318 22,191 16,454 2,390 793 6,215 7,056 71 Investment in unconsolidated subsidiaries 3,146 3,109 3,069 1,546 182 1,240 101 72 Customer acceptances outstanding 16,489 15,293 14,788 7,399 1,089 5,908 392 73 Other assets 38,347 35,288 31,300 12,779 1,241 12,456 4,824 74 Total assets 1,215,052 1,172,773 888,551 165,307 43,748 332,417 347,080 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A19 1.26 Continued Member banks1 All Insured Non- Liability or capital account commercial commercial Large banks member banks banks banks1 Total All other New York City of Other City Chicago large2 75 Demand deposits 374,758 367,867 282,751 65,198 10,932 100,994 105,627 92,006 76 Mutual savings banks 1,626 1,425 1,217 588 291 337 409 77 Other individuals, partnerships, and corporations 279,829 278,459 206,399 33,292 7,802 78,702 86,603 73,430 78 U.S. government 7,964 7,956 5,641 584 187 2,043 2,828 2,323 79 States and political subdivisions 18,210 18,138 12,421 830 184 3,564 7,842 5,789 80 Foreign governments, central banks, etc 1,840 1,351 1,317 1,084 25 170 37 524 81 Commercial banks in United States 38,924 37,963 36,639 18,730 2,147 11,503 4,260 2,285 82 Banks in foreign countries 8,721 7,815 7,679 6,007 225 1,249 198 1,042 83 Certified and officers' checks, etc 17,643 14,760 11,440 4,083 361 3,473 3,522 6,204 84 Time deposits 336655,,001155 335533,,557711 257,007 37,850 15,695 93,735 109,727 108,008 85 Accumulated for personal loan payments 9900 9900 72 71 18 86 Mutual savings banks 229922 227755 263 115 37 90 20 29 87 Other individuals, partnerships, and corporations 287,380 280,154 202,808 29,149 12,118 72,205 89,336 84,572 88 U.S. government 989 989 793 82 39 421 251 195 89 States and political subdivisions 56,273 55,928 38,077 1,672 1,261 16,031 19,113 18,195 90 Foreign governments, central banks, etc 10,171 7,429 7,193 4,184 1,201 1,684 123 2,979 91 Commercial banks in United States 7,968 7,352 6,645 1,917 911 3,113 705 1,323 92 Banks in foreign countries 1,853 1,354 1,156 730 128 190 108 697 93 Savings deposits 222266,,002266 222244,,443366 154,577 10,945 2,758 55,474 85,401 71,449 94 Individuals and nonprofit organizations 221100,,445533 220099,,006677 144,198 10,150 2,612 51,865 79,572 66,255 95 Corporations and other profit organizations.. 1100,,880077 1100,,778877 7,431 504 137 3,091 3,699 3,376 96 U.S. government 6622 6622 53 16 36 9 97 States and political subdivisions 44,,550011 44,,448866 2,863 273 9 494 2,087 1,638 98 Allother 220044 3355 31 16 * 9 7 172 99 Total deposits 965,799 945,875 694,335 113,992 29,385 250,204 300,755 271,464 100 Federal funds purchased and securities sold under agreements to repurchase 93,179 88,903 83,003 20,103 8,989 40,575 13,336 10,176 101 Commercial banks 46,947 43,727 41,154 7,773 5,904 21,697 5,780 5,793 102 Brokers and dealers 13,356 13,289 12,325 3,199 1,897 5,686 1,543 1,030 103 Others 32,876 31,887 29,524 9,132 1,188 13,192 6,013 3,352 104 Other liabilities for borrowed money 13,586 9,448 9,112 3,398 179 4,243 1,292 4,473 105 Mortgage indebtedness 1,738 1,733 1,425 233 28 698 465 313 106 Bank acceptances outstanding 17,125 15,925 15,419 8,014 1,095 5,916 394 1,705 107 Other liabilities 33,773 22,062 19,126 5,911 1,106 8,051 4,057 14,647 108 Total liabilities 1,125,200 1,083,946 822,421 151,651 40,782 309,688 320,299 302,779 109 Subordinated notes and debentures 5,816 5,753 4,440 1,004 80 2,061 1,296 1,376 110 Equity capital 84,037 83,074 61,690 12,652 2,885 20,668 25,485 22,347 111 Preferred stock 88 81 33 2 31 55 112 Common stock 17,790 17,691 12,743 2,645 570 3,997 5,531 5,047 113 Surplus 32,386 31,874 22,906 4,451 1,404 8,063 8,898 9,480 114 Undivided profits 31,949 31,684 24,803 5,334 859 8,238 10,372 7,146 115 Other capital reserves 1,824 1,744 1,205 132 52 368 652 619 116 Total liabilities and equity capital 1,215,052 1,172,773 888,551 165,307 43,748 332,417 347,080 326,501 MEMO ITEMS: 117 Demand deposits adjusted2 258,603 252,756 173,993 21,771 5,368 59,847 87,007 84,610 Average for last 15 or 30 days: 118 Cash and due from bank 151,066 142,173 121,518 35,452 5,619 44,611 35,836 29,548 119 Federal funds sold and securities purchased under agreements to resell 53,196 47,463 36,121 5,530 1,901 16,558 12,132 17,075 120 Total loans 647,386 628,167 468,342 74,085 24,972 178,557 190,728 179,043 121 Time deposits of $ 100,000 or more 181,510 174,479 143,050 31,979 12,833 61,496 36,742 38,459 122 Total deposits 941,481 923,749 675,725 106,594 28,441 243,663 297,026 265,756 123 Federal funds purchased and securities sold under agreements to repurchase 95,273 90,853 85,358 21,859 9,825 40,469 13,205 9,915 124 Other liabilities for borrowed money 13,002 8,533 8,027 3,433 171 3,437 986 4,975 125 Standby letters of credit outstanding 18,948 17,750 16,686 9,406 1,269 4,796 1,215 2,262 126 Time deposits of $100,000 or more 183,339 177,602 145,695 32,476 13,253 62,711 37,245 37,653 127 Certificates of deposit 155,925 151,931 123,685 28,200 11,450 52,439 31,595 32,240 128 Other time deposits 27,414 25,671 22,001 4,277 1,803 10,271 5,650 5,413 129 Number of banks 14,698 14,381 5,621 12 9 153 5,447 9,077 1 Member banks exclude and nonmember banks include 13 noninsured NOTE. Data include consolidated reports, including figures for all trust companies that are members of the Federal Reserve System. bank-premises subsidiaries and other significant majority-owned do- 2 Demand deposits adjusted are demand deposits other than domestic mestic subsidiaries. Securities are reported on a gross basis before deduccommercial interbank and U.S. government, less cash items reported tions of valuation reserves. Back data in lesser detail were shown in as in process of collection. previous BULLETINS. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 Domestic NonfinancialS tatistics • February 1979 1.27 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of £750 Million or More on December 31, 1977, Assets and Liabilities Millions of dollars, Wednesday figures 1978 1979 Account Dec. 6e Dec. 13* Dec. 20e Dec. 27 Jan. 3P Jan. 10*' Jan. 17»' Jan. 24P 1 Cash items in process of collection 44,260 45,198 48,512 52,100 54,830 44,287 46,233 39,735 2 Demand deposits due from banks in the United States 15,112 14,445 14,145 13,122 3 All other cash and due from depositary institutions 33,854 30,336 36,357 33,453 4 Total loans and securities 445,536 444,042 453,242 454,702 458,040 453,052 450,897 447,922 Securities U.S. Treasury securities 35,443 35,714 35,773 35,902 35,533 35,102 35,778 35,710 Trading account 3,112 3,272 3,989 4,209 Investment account, by maturity 32,421 31,830 31,789 31,501 One year or less 8,805 8,361 8,283 8,173 Over one through five years 19,503 19,370 19,304 19,160 Over five years 4,114 4,099 4,203 4,168 Other securities 60,854 61,702 61,747 61,691 63,564 63,914 63,669 63,697 Trading account 2,420 2,658 2,562 2,283 Investment account 61,144 61.256 61,107 61,414 U.S. government agencies . . . . 11,909 11,897 11,656 11,928 States and political subdivision, by maturity. 46,037 46.257 46,399 46,485 One year or less 7,706 7,772 7,708 7,645 Over one year 38,332 38,486 38,692 38,839 Other bonds, corporate stocks and securities 3,198 3,102 3,052 3,001 Loans 19 Federal funds sold1 27,380 25,775 24,076 22,608 20 To commercial banks 16,573 16,387 20,349 21,905 19,454 16,789 15,814 16,621 21 To nonbank brokers and dealers in securities, 5,510 5,979 6,025 4,276 22 Toothers 2,416 3,006 2,237 1,712 23 Other loans, gross 341,526 338,262 337,401 335,972 24 Commercial and industrial. . . . 130,662 131,801 132,150 133,896 132,057 132,060 131,795 25 Bankers' acceptances and commercial paper 4,351 3,442 3,628 3,504 26 All other 129,545 128,614 128,432 128,291 27 U.S. addresses 123,477 122,672 122,428 122,147 28 Non-U.S. addressees 6,068 5,942 6,004 6,143 29 Real estate 78,916 79,505 79,835 80,664 81,061 81,191 81,490 30 To individuals for personal expenditures. . . . 58,663 58,689 58,941 59,278 To financial institutions 31 Commercial banks in the U.S 2,805 2,633 3,029 3,297 3,498 3,110 3,309 3,065 32 Banks in foreign countries 8,851 9,053 9,451 9,976 9,662 9,018 8,978 8,510 33 Sales finance, personal finance companies, etc 8,223 8,129 8,602 8,818 8,112 8,237 7,919 7,893 34 Other financial institutions 15,006 15,179 15,163 15,234 15,969 15,926 15,802 15,433 35 To nonbank brokers and dealers in securities 8,445 8,516 7,725 7,659 36 To others for purchasing and carrying securities2 2,129 2,149 2,173 2,172 2,202 2,232 2,279 2,302 37 To finance agricultural production 4,421 4,416 4,445 4,511 4,584 4,574 4,535 4,465 38 Allother 15,828 14,842 14,662 14,081 39 Less: Unearned income 5,618 5,645 5,678 5,708 40 Loan loss reserve 4,345 4,356 4,348 4,356 41 Other loans, net 331,562 328,262 327,374 325,907 42 Lease financing receivables 4,803 4,886 5,074 5,119 43 All other assets 66,188 66,938 65,588 63,845 44 Total assets 600,047 605,144 615,785 630,331 632,828 613,945 618,295 603,197 Deposits 45 Demand deposits. 177,965 180,086 188,345 192,637 203,164 182,347 184,556 169,066 46 Mutual savings banks 778 644 676 698 1,004 860 754 671 47 Individuals, partnerships, and corporations. . 125,797 129,449 131,530 135,620 144,472 128,858 133,133 122,167 48 States and political subdivisions 4,423 4,437 4,818 4,854 5.291 4,737 5,024 4,969 49 U.S. government 1,015 939 2,682 964 978 1,632 1,054 1,107 50 Commercial banks in United States 30,316 27,943 30,691 33,213 34,122 31,054 28,818 25,299 51 Banks in foreign countries 6,390 7,030 7,860 8,268 7,711 6,785 6,651 6,728 52 Foreign governments and official institutions . 1,321 1,969 1,546 1,713 1,646 1,035 1,234 1,481 53 Certified and officers' checks 7,774 7,523 8,390 7,156 7,941 7,387 7,888 6,643 54 Time and savings deposits 253,077 255,031 255,079 255,109 258,104 259,444 259,224 260,066 55 Savings 76,762 76,490 76,268 76,494 77,869 77,866 77,446 76,968 56 Individuals and nonprofit organizations 71,420 71,192 71,035 71,270 72,394 72,320 72,068 71,561 57 Partnerships and corporations operated for profit 4,485 4,432 4,353 4,367 4,530 4,536 4,427 4,450 58 Domestic governmental units 814 826 840 814 903 962 907 914 59 Allother 42 41 40 42 41 48 44 42 60 Time 176,315 178,541 178,811 178,615 180,234 181,578 181,777 183,098 61 Individuals, partnerships, and corporations.. 138,928 140,724 140,894 140,973 141,967 142,452 142,528 143,524 62 States and political subdivisions 22,447 22,734 22,618 22,545 23,131 23,396 23,610 23,898 63 U.S. government 524 472 475 474 484 488 495 485 64 Commercial banks in United States 6,828 7,129 7,334 7,276 7,528 7,769 7,781 7,772 65 Foreign governments, official institutions, and banks 7,588 7,482 7,491 7,347 7,125 7,473 7,363 7,418 66 Federal funds purchased 3 76,556 78,047 75,424 73,380 75,773 76,819 74,569 Other liabilities for borrowed money 67 Borrowings from Federal Reserve Banks. . 184 74 120 2,552 142 316 1,532 432 68 Treasury tax-and-loan notes 6.292 2,910 3,811 5,736 69 All other liabilities for borrowed money. .. "9,906' ' 9,499 14,316 i6*022 8,217 8,497 7,388 8,610 70 Other liabilities and subordinated note and debentures 41,933 42,684 43,593 43,418 71 Total liabilities 591,234 571,970 576,924 561,896 72 Residual (total assets minus total liabilities)4. 41,594 41,975 41,371 41,301 1 Includes securities purchased under agreements to resell. 4 This is not a measure of equity capital for use in capital adequacy 2 Other than financial institutions and brokers and dealers. analysis or for other analytic uses. 3 Includes securities sold under agreements to repurchase. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Banks A21 1.28 LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of £1 Billion or More on December 31, 1977 Assets and Liabilities Millions of dollars, Wednesday figures 1979 Dec. 66 Dec. 13e Dec. 20e Dec. 27 Jan. 3p Jan. 10" Jan. 17" Jan. 24" Jan. 31" 1 Cash items in process of collection 42,170 43,087 46,269 49,630 51,843 42,046 43,902 37,610 41,799 2 Demand deposits due from banks in the United States 14,081 13,706 13,352 12,524 13,710 3 All other cash and due from depositary institutions 31,822 28,628 34,671 31,513 27,998 4 Total loans and securities 415,334 415,143 423,848 425,750 428,352 422,666 420,994 418,541 421,336 Securities 5 U.S. Treasury securities 32,911 33,179 33,260 33,377 33,162 32,701 33,411 33,336 32,797 6 Trading account 3,073 3,244 3,964 4,179 3,952 Investment account, by maturity 30,089 29,456 29,446 29,157 28,845 One year or less 8,157 7,703 7,648 7,536 7,264 Over one through five years 18,172 18,017 17,960 17,822 17,710 Over five years 3,761 3,737 3,839 3,800 3,871 Other securities 55,554 56,366 56,402 56,324 58,651 58,878 58,774 58,822 58,895 Trading account 2,359 2,603 2,502 2,230 2,413 Investment account 56,292 56,274 56,272 56,592 56,482 U.S. government agencies 11,068 10,996 10,831 11,118 11,036 States and political subdivision, by maturity. 42,266 42,444 42,625 42,709 42,707 One year or less 7,023 7,077 7,132 7,071 7,182 Over one year 35,243 35,367 35,492 35,638 35,525 Other bonds, corporate stocks and securities 2,958 2,835 2,816 2,766 2,739 Loans 19 Federal funds sold1 25,130 23,310 21,532 20,581 22,872 20 To commercial banks 14,788 14,654 18,405 20,347 17,535 14,628 13,672 14,912 15,698 21 To nonbank brokers and dealers in securities. 5,242 5,708 5,674 3,979 5,141 22 To others 2,353 2,974 2,185 1,690 2,033 23 Other loans, gross 320,641 317,022 316,574 315,132 316,103 24 Commercial and industrial 124,348 124,268 125,362 125,575 127,017 124,968 125,228 124,980 124,844 25 Bankers' acceptances and commercial paper 4,281 3,371 3,561 3,446 3,421 26 All other 122,736 121,598 121,667 121,534 121,423 27 U.S. addresses 116,728 115,711 115,720 115,439 115,236 28 Non-U.S. addressees 6,008 5,886 5,947 6,095 6,187 29 Real estate 75,590 75,843 76,058 76,335 76,627 30 To individuals for personal expenditures 52,181 52,166 52,442 52,743 53,263 To financial institutions 31 Commercial banks in the U.S 2,724 2,556 2,919 3,209 3,406 3,010 3,215 2,91 A 2,788 32 Banks in foreign countries 8,788 8,991 9,390 9,910 9,590 8,934 8,894 8,425 8,284 33 Sales finance, personal finance companies, etc 8,014 7,917 8,373 8,586 7,892 8,007 7,701 7,688 7,746 34 Other financial institutions 14,590 14,760 14,749 14,819 15,431 15,392 15,273 14,914 14,851 35 To nonbank brokers and dealers in securities. 8,320 8,405 7,619 7,555 8,557 36 To others for purchasing and carrying securities2 1,831 1,852 1,871 1,874 1,898 1,927 1,974 1,997 2,001 37 To finance agricultural production 4,282 4,274 4,301 4,369 4,422 4,410 4,372 4,303 4,314 38 All other 14,894 13,960 13,797 13,217 12,829 39 Less: Unearned income 5,138 5,149 5,194 5,221 5,158 40 Loan loss reserve 4,094 4,095 4,102 4,109 4,173 41 Other loans, net 311,409 307,778 307,278 305,802 306,772 42 Lease financing receivables 4,646 4,734 4,919 4,962 5,079 43 All other assets 64,701 65,278 63,953 62,314 62,532 44 Total assets 565,564 570,813 580,637 595,027 595,445 577,058 581,792 567,464 572,454 Deposits 45 Demand deposits. 167,075 169,181 177,039 181,333 190,575 170,814 173,085 158,606 165,550 46 Mutual savings banks 744 617 652 677 964 822 728 647 718 47 Individuals, partnerships, and corporations. 117,445 120,997 122,970 126,842 134,769 119,837 124,232 114,073 116,089 48 States and political subdivisions 3,898 3,870 4,198 4,243 4,639 4,120 4,345 4,261 4,798 49 U.S. government 913 854 2,468 881 870 1,485 901 939 1,219 50 Commercial banks in United States 28,967 26,704 29,412 31,948 32,420 29,748 27,452 24,143 27,745 51 Banks in foreign countries 6,330 6,953 7,750 8,176 7,650 6,662 6,582 6,661 6,732 52 Foreign governments and official institutions , 1,317 1,965 1,542 1,710 1,645 1,030 1,226 1,471 1,145 53 Certified and officers' checks 7,332 7,092 7,917 6,728 7,618 7,110 7,619 6,411 7,104 54 Time and savings deposits 237,060 238,984 239,015 239,042 241,471 242,518 242,429 243,248 241,413 55 Savings. 71,141 70,898 70,690 70,924 72,190 72,068 71,801 71,366 71,013 56 Individuals and nonprofit organizations 66,224 66,021 65,881 66,117 67,107 66,950 66,819 66,352 66,059 57 Partnerships and corporations operated for profit 4,138 4,081 4,007 4,020 4,194 4,178 A,091 4,123 4,107 58 Domestic governmental units 737 755 763 745 847 892 841 848 805 59 All other 42 41 39 42 41 48 43 42 42 60 Time 165,919 168,086 168,325 168,118 169,280 170,450 170,628 171,882 170,400 61 Individuals, partnerships, and corporations.. 130,724 132,458 132,632 132,722 133,348 133,790 133,816 134,766 133,548 62 States and political subdivisions 20,421 20,722 20,587 20,497 21,084 21,240 21,492 21,755 21,678 63 U.S. government 519 467 470 469 479 484 490 481 485 64 Commercial banks in United States 6,678 6,968 7,157 7,095 7,258 7,479 7,482 7,477 7,384 65 Foreign governments, official institutions, and banks 7,577 7,471 7,480 7,336 7,112 7,458 7,348 7,403 7,305 66 Federal funds purchased3 72,904 74,592 71,840 77,272 69,740 71,764 72,874 70,809 66,505 Other liabilities for borrowed money 67 Borrowings from Federal Reserve Banks., 162 42 105 2,490 128 301 1,517 326 3,490 68 Treasury tax-and-loan notes 5,775 2,755 3,543 5,324 6,266 69 All other liabilities for borrowed money. .. "9,' 520' 9,' i25 i 3 * 635 ''15*243' 7,914 8,040 7,051 8,172 7,504 70 Other liabilities and subordinated note and debentures 40,838 41,545 42,519 42,272 42,766 71 Total liabilities 556,442 537,737 543,020 528,756 533,496 72 Residual (total assets minus total liabilities) 39,003 39,321 38,772 38,709 38,959 1 Includes securities purchased under agreements to resell. 4 This is not a measure of equity capital for use in capital adequacy 2 Other than financial institutions and brokers and dealers. analysis or for other analytic uses. 3 Includes securities sold under agreements to repurchase. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 Domestic Nonfinancial Statistics • February 1979 1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1978 1979 AAccccoouunntt Dec. 6e Dec. 13 * Dec. 20« Dec. 27 e Jan. 3f Jan. 10f Jan. 17p Jan. 24p Jan. 31 p 1 Cash items in process of collection 15,362 15,430 16,872 17,747 11117777,,,,333366669999 11116666,,,,666677775555 11115555,,,,999999990000 11113333,,,,555599994444 11115555,,,,999977775555 2 Demand deposits due from banks in the United States 7777,,,,666677779999 8888,,,,555511115555 8888,,,,000044440000 7777,,,,888899994444 8888,,,,666622227777 3 All other cash and due from depositary institutions 9999,,,,222222222222 6666,,,,888888883333 11110000,,,,000044448888 8888,,,,555555558888 7777,,,,666622220000 99998888,,,,444466668888 99995555,,,,888888885555 99995555,,,,000088887777 99994444,,,,888899999999 99996666,,,,444422229999 Securities 5 U.S. Treasury securities2 6 Trading account2 7 Investment account, by maturity 66666,,,,,444448888855555 66666,,,,,333330000066666 66666,,,,,111118888833333 55555,,,,,888889999922222 55555,,,,,888884444444444 8 One year or less 11111,,,,,111111111199999 999995555588888 888883333377777 777775555500000 666665555500000 9 Over one through five years 44444,,,,,666665555533333 44444,,,,,666665555533333 44444,,,,,666660000066666 44444,,,,,444441111199999 44444,,,,,444444444477777 10 Over five years 777771111122222 666669999966666 777773333399999 777772222233333 777774444488888 11 Other securities2 12 Trading account2 13 Investment account 1111111111111111111111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222226666666666666666666666677777777777777777777777 1111111111111111111111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111119999999999999999999999966666666666666666666666 11111111111111111111111111111111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222244444444444444444444444444443333333333333333333333333333 11111111111111111111111111111111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222299999999999999999999999999990000000000000000000000000000 11111111111111111111111111111111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222255555555555555555555555555558888888888888888888888888888 14 U.S. government agencies 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333337777777777777777777777766666666666666666666666 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333337777777777777777777777766666666666666666666666 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333377777777777777777777777777775555555555555555555555555555 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444422222222222222222222222222226666666666666666666666666666 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444400000000000000000000000000005555555555555555555555555555 15 States and political subdivision, by maturity. 99999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222222222222222222222200000000000000000000000 99999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111118888888888888888888888800000000000000000000000 9999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222211111111111111111111111111115555555555555555555555555555 9999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222211111111111111111111111111115555555555555555555555555555 9999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222200000000000000000000000000005555555555555555555555555555 16 One year or less 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888883333333333333333333333322222222222222222222222 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777778888888888888888888888833333333333333333333333 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888811111111111111111111111111117777777777777777777777777777 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777755555555555555555555555555550000000000000000000000000000 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777733333333333333333333333333332222222222222222222222222222 17 Over one year 77777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333338888888888888888888888888888888888888888888888 77777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333339999999999999999999999977777777777777777777777 7777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333399999999999999999999999999998888888888888888888888888888 7777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444466666666666666666666666666665555555555555555555555555555 7777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444477777777777777777777777777773333333333333333333333333333 18 Other bonds, corporate stocks and securities. . 666666666666666666666667777777777777777777777711111111111111111111111 666666666666666666666664444444444444444444444411111111111111111111111 666666666666666666666666666655555555555555555555555555552222222222222222222222222222 666666666666666666666666666644444444444444444444444444448888888888888888888888888888 666666666666666666666666666644444444444444444444444444448888888888888888888888888888 Loans 19 Federal funds sold3 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888888888888888888888866666666666666666666666 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666664444444444444444444444433333333333333333333333 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222288888888888888888888888888888888888888888888888888888888 5555555555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111100000000000000000000000000005555555555555555555555555555 6666666666666666666666666666,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444411111111111111111111111111119999999999999999999999999999 20 To commercial banks 2,672 2,428 4,608 4,319 33333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444444444444444444444444444444444444444444444 22222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999996666666666666666666666622222222222222222222222 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777788888888888888888888888888882222222222222222222222222222 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999911111111111111111111111111112222222222222222222222222222 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777777777777777777777777777777779999999999999999999999999999 21 To nonbank brokers and dealers in securities. 11111111111111111111111 ,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000003333333333333333333333355555555555555555555555 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000004444444444444444444444411111111111111111111111 999999999999999999999999999988888888888888888888888888881111111111111111111111111111 999999999999999999999999999988888888888888888888888888888888888888888888888888888888 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222288888888888888888888888888881111111111111111111111111111 22 To others 444444444444444444444440000000000000000000000066666666666666666666666 666666666666666666666664444444444444444444444400000000000000000000000 555555555555555555555555555522222222222222222222222222225555555555555555555555555555 222222222222222222222222222200000000000000000000000000004444444444444444444444444444 333333333333333333333333333355555555555555555555555555558888888888888888888888888888 23 Other loans, gross 7777777777777777777777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888882222222222222222222222288888888888888888888888 7777777777777777777777755555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777771111111111111111111111199999999999999999999999 77777777777777777777777777775555555555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333366666666666666666666666666663333333333333333333333333333 77777777777777777777777777774444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666666666600000000000000000000000000005555555555555555555555555555 77777777777777777777777777774444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999911111111111111111111111111112222222222222222222222222222 24 Commercial and industrial 38,589 38,648 39,459 39,590 3333333333333333333333399999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333333333333333333333366666666666666666666666 3333333333333333333333388888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000000000000000000000000000000000000000000000 33333333333333333333333333337777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888877777777777777777777777777776666666666666666666666666666 33333333333333333333333333337777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666666666644444444444444444444444444443333333333333333333333333333 33333333333333333333333333337777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444400000000000000000000000000004444444444444444444444444444 25 Bankers' acceptances and commercial 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999998888888888888888888888800000000000000000000000 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222229999999999999999999999955555555555555555555555 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333388888888888888888888888888880000000000000000000000000000 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111199999999999999999999999999999999999999999999999999999999 999999999999999999999999999966666666666666666666666666664444444444444444444444444444 26 All other 3333333333333333333333377777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333335555555555555555555555566666666666666666666666 3333333333333333333333366666666666666666666666,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777770000000000000000000000055555555555555555555555 33333333333333333333333333336666666666666666666666666666,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444499999999999999999999999999996666666666666666666666666666 33333333333333333333333333336666666666666666666666666666,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444444444444444444444444444444444444444444444444444444444444 33333333333333333333333333336666666666666666666666666666,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444444444444444444444444444444440000000000000000000000000000 27 U.S. addressees 3333333333333333333333355555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000006666666666666666666666611111111111111111111111 3333333333333333333333344444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444441111111111111111111111166666666666666666666666 33333333333333333333333333334444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222288888888888888888888888888885555555555555555555555555555 33333333333333333333333333334444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222255555555555555555555555555557777777777777777777777777777 33333333333333333333333333334444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000099999999999999999999999999991111111111111111111111111111 28 Non-U.S. addressees 22222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222229999999999999999999999944444444444444444444444 22222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222228888888888888888888888899999999999999999999999 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222211111111111111111111111111112222222222222222222222222222 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111188888888888888888888888888887777777777777777777777777777 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333344444444444444444444444444449999999999999999999999999999 29 Real estate 9,986 10,022 10,057 10,121 1111111111111111111111100000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111117777777777777777777777788888888888888888888888 1111111111111111111111100000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222221111111111111111111111100000000000000000000000 11111111111111111111111111110000000000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222211111111111111111111111111117777777777777777777777777777 11111111111111111111111111110000000000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222244444444444444444444444444445555555555555555555555555555 11111111111111111111111111110000000000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222299999999999999999999999999993333333333333333333333333333 30 To individuals for personal expenditures. .. . 77777777777777777777777.......................222222222222222222222229999999999999999999999944444444444444444444444 77777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222229999999999999999999999944444444444444444444444 7777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222266666666666666666666666666665555555555555555555555555555 7777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222266666666666666666666666666662222222222222222222222222222 7777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222277777777777777777777777777774444444444444444444444444444 To financial institutions 31 Commercial banks in the U.S 1,064 948 1,102 1,356 11111111111111111111111.......................222222222222222222222229999999999999999999999955555555555555555555555 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000009999999999999999999999944444444444444444444444 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222222222222222222222222222222224444444444444444444444444444 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111155555555555555555555555555558888888888888888888888888888 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000011111111111111111111111111110000000000000000000000000000 32 Banks in foreign countries 3,834 3,966 4,316 4,760 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333332222222222222222222222277777777777777777777777 44444444444444444444444 000000000000000000000000000000000000000000000088888888888888888888888 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999900000000000000000000000000003333333333333333333333333333 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555544444444444444444444444444446666666666666666666666666666 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444499999999999999999999999999997777777777777777777777777777 33 Sales finante, personal finance companies, etc 3,002 2,913 3,117 3,326 33333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111112222222222222222222222277777777777777777777777 33333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111117777777777777777777777744444444444444444444444 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000033333333333333333333333333334444444444444444444444444444 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999933333333333333333333333333338888888888888888888888888888 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000011111111111111111111111111117777777777777777777777777777 34 Other financial institutions 4,466 4,538 4,592 4,530 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444442222222222222222222222277777777777777777777777 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444445555555555555555555555555555555555555555555555 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444455555555555555555555555555552222222222222222222222222222 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444400000000000000000000000000007777777777777777777777777777 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444400000000000000000000000000004444444444444444444444444444 35 To nonbank brokers and dealers in securities 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666663333333333333333333333355555555555555555555555 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555552222222222222222222222299999999999999999999999 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000055555555555555555555555555555555555555555555555555555555 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222288888888888888888888888888881111111111111111111111111111 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888822222222222222222222222222223333333333333333333333333333 36 To others for purchasing and carrying securities4 365 366 368 369 333333333333333333333336666666666666666666666666666666666666666666666 333333333333333333333336666666666666666666666644444444444444444444444 444444444444444444444444444400000000000000000000000000001111111111111111111111111111 444444444444444444444444444400000000000000000000000000003333333333333333333333333333 444444444444444444444444444411111111111111111111111111111111111111111111111111111111 37 To finance agricultural production 192 193 201 195 111111111111111111111119999999999999999999999922222222222222222222222 111111111111111111111119999999999999999999999933333333333333333333333 111111111111111111111111111199999999999999999999999999994444444444444444444444444444 111111111111111111111111111199999999999999999999999999990000000000000000000000000000 222222222222222222222222222200000000000000000000000000000000000000000000000000000000 38 All other 22222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666665555555555555555555555500000000000000000000000 22222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333339999999999999999999999999999999999999999999999 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777733333333333333333333333333339999999999999999999999999999 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555533333333333333333333333333332222222222222222222222222222 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555577777777777777777777777777779999999999999999999999999999 39 Less: Unearned income 666666666666666666666666666666666666666666666622222222222222222222222 666666666666666666666664444444444444444444444499999999999999999999999 666666666666666666666666666655555555555555555555555555557777777777777777777777777777 666666666666666666666666666666666666666666666666666666660000000000000000000000000000 666666666666666666666666666633333333333333333333333333339999999999999999999999999999 40 Loan loss reserve 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333333333333333333333366666666666666666666666 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333333333333333333333311111111111111111111111 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333333333333333333333333333333333333333333333333333333333333 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333333333333333333333333333333333333333333333333333333333333 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333366666666666666666666666666664444444444444444444444444444 41 Other loans, net 7777777777777777777777755555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888883333333333333333333333300000000000000000000000 7777777777777777777777733333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777773333333333333333333333399999999999999999999999 77777777777777777777777777773333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333377777777777777777777777777773333333333333333333333333333 77777777777777777777777777772222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666666666611111111111111111111111111112222222222222222222222222222 77777777777777777777777777772222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999900000000000000000000000000008888888888888888888888888888 42 Lease financing receivables 444444444444444444444449999999999999999999999900000000000000000000000 444444444444444444444448888888888888888888888899999999999999999999999 444444444444444444444444444499999999999999999999999999997777777777777777777777777777 444444444444444444444444444488888888888888888888888888889999999999999999999999999999 444444444444444444444444444499999999999999999999999999992222222222222222222222222222 43 All other assets 5 3333333333333333333333322222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111114444444444444444444444411111111111111111111111 3333333333333333333333322222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999994444444444444444444444411111111111111111111111 33333333333333333333333333332222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111100000000000000000000000000003333333333333333333333333333 33333333333333333333333333332222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444422222222222222222222222222227777777777777777777777777777 33333333333333333333333333332222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000022222222222222222222222222226666666666666666666666666666 44 Total assets 159,494 162,046 165,982 117700,,441122 111111111111111111111116666666666666666666666655555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333337777777777777777777777700000000000000000000000 111111111111111111111116666666666666666666666611111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333338888888888888888888888888888888888888888888888 111111111111111111111111111166666666666666666666666666661111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777766666666666666666666666666664444444444444444444444444444 111111111111111111111111111155555555555555555555555555557777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888866666666666666666666666666661111111111111111111111111111 111111111111111111111111111166666666666666666666666666661111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111166666666666666666666666666669999999999999999999999999999 Deposits 45 Demand deposits 54,709 55,123 60,048 6611,,337799 6666666666666666666666600000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222227777777777777777777777777777777777777777777777 5555555555555555555555566666666666666666666666,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666664444444444444444444444488888888888888888888888 55555555555555555555555555555555555555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777777777777777777777777777777770000000000000000000000000000 55555555555555555555555555552222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222244444444444444444444444444442222222222222222222222222222 55555555555555555555555555556666666666666666666666666666,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111100000000000000000000000000003333333333333333333333333333 46 Mutual savings banks 420 326 353 337766 555555555555555555555558888888888888888888888844444444444444444444444 555555555555555555555551111111111111111111111166666666666666666666666 444444444444444444444444444411111111111111111111111111118888888888888888888888888888 333333333333333333333333333377777777777777777777777777773333333333333333333333333333 444444444444444444444444444422222222222222222222222222227777777777777777777777777777 47 Individuals, partnerships, and corporations... 28,400 29,256 30,112 3300,,770000 3333333333333333333333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111119999999999999999999999922222222222222222222222 2222222222222222222222288888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777775555555555555555555555533333333333333333333333 33333333333333333333333333330000000000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000022222222222222222222222222229999999999999999999999999999 22222222222222222222222222228888888888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555511111111111111111111111111112222222222222222222222222222 22222222222222222222222222229999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333399999999999999999999999999997777777777777777777777777777 48 States and political subdivisions 442 395 455 446633 444444444444444444444443333333333333333333333300000000000000000000000 444444444444444444444440000000000000000000000033333333333333333333333 444444444444444444444444444466666666666666666666666666664444444444444444444444444444 444444444444444444444444444422222222222222222222222222226666666666666666666666666666 555555555555555555555555555511111111111111111111111111118888888888888888888888888888 49 U.S. government 101 131 676 110044 111111111111111111111113333333333333333333333399999999999999999999999 333333333333333333333330000000000000000000000055555555555555555555555 111111111111111111111111111199999999999999999999999999994444444444444444444444444444 222222222222222222222222222277777777777777777777777777779999999999999999999999999999 222222222222222222222222222222222222222222222222222222224444444444444444444444444444 50 Commercial banks in United States 16,201 14,638 17,143 1199,,005500 1111111111111111111111155555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888883333333333333333333333388888888888888888888888 1111111111111111111111188888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222224444444444444444444444444444444444444444444444 11111111111111111111111111115555555555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333388888888888888888888888888880000000000000000000000000000 11111111111111111111111111113333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777711111111111111111111111111112222222222222222222222222222 11111111111111111111111111116666666666666666666666666666,,,,,,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666666666644444444444444444444444444445555555555555555555555555555 51 Banks in foreign countries 4,575 5,060 5,897 66,,336644 55555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444449999999999999999999999900000000000000000000000 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777770000000000000000000000055555555555555555555555 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777711111111111111111111111111112222222222222222222222222222 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777766666666666666666666666666667777777777777777777777777777 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999922222222222222222222222222224444444444444444444444444444 52 Foreign governments and official institutions. 1,068 1,726 1,258 11,,444444 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333336666666666666666666666666666666666666666666666 777777777777777777777778888888888888888888888866666666666666666666666 999999999999999999999999999966666666666666666666666666662222222222222222222222222222 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111188888888888888888888888888881111111111111111111111111111 777777777777777777777777777777777777777777777777777777770000000000000000000000000000 53 Certified and officers' checks 3,502 3,591 4,153 22,,887766 33333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222223333333333333333333333388888888888888888888888 22222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999993333333333333333333333366666666666666666666666 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666666666611111111111111111111111111111111111111111111111111111111 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999999999999999999999999999999992222222222222222222222222222 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111199999999999999999999999999997777777777777777777777777777 54 Time and savings deposits 50,578 50,872 51,004 5500,,777722 5555555555555555555555500000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888880000000000000000000000088888888888888888888888 5555555555555555555555511111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222222222222222222222244444444444444444444444 55555555555555555555555555551111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333344444444444444444444444444449999999999999999999999999999 55555555555555555555555555551111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999911111111111111111111111111113333333333333333333333333333 55555555555555555555555555550000000000000000000000000000,,,,,,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999999999999999999999999999999999999996666666666666666666666666666 55 Savings 9,331 9,343 9,288 99,,331100 99999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444441111111111111111111111144444444444444444444444 99999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555555555555555555555566666666666666666666666 9999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555533333333333333333333333333337777777777777777777777777777 9999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555511111111111111111111111111116666666666666666666666666666 9999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444488888888888888888888888888886666666666666666666666666666 56 Individuals and nonprofit organizations 8,695 8,701 8,664 88,,669900 88888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777776666666666666666666666611111111111111111111111 88888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888889999999999999999999999900000000000000000000000 8888888888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888899999999999999999999999999990000000000000000000000000000 8888888888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888844444444444444444444444444446666666666666666666666666666 8888888888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888844444444444444444444444444442222222222222222222222222222 57 Partnerships and corporations operated for profit 460 454 440 444444 444444444444444444444446666666666666666666666611111111111111111111111 444444444444444444444446666666666666666666666600000000000000000000000 444444444444444444444444444444444444444444444444444444449999999999999999999999999999 444444444444444444444444444455555555555555555555555555550000000000000000000000000000 444444444444444444444444444433333333333333333333333333338888888888888888888888888888 58 Domestic governmental units 160 170 168 116622 111111111111111111111118888888888888888888888822222222222222222222222 111111111111111111111118888888888888888888888899999999999999999999999 111111111111111111111111111188888888888888888888888888885555555555555555555555555555 222222222222222222222222222200000000000000000000000000009999999999999999999999999999 111111111111111111111111111199999999999999999999999999996666666666666666666666666666 59 All other 16 18 16 1144 1111111111111111111111111111111111111111111111 1111111111111111111111166666666666666666666666 11111111111111111111111111112222222222222222222222222222 11111111111111111111111111111111111111111111111111111111 9999999999999999999999999999 60 Time 41,246 41,528 41,716 4411,,446611 4444444444444444444444411111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333339999999999999999999999944444444444444444444444 4444444444444444444444411111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666666666666666666666666666688888888888888888888888 44444444444444444444444444441111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888811111111111111111111111111112222222222222222222222222222 44444444444444444444444444442222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333399999999999999999999999999997777777777777777777777777777 44444444444444444444444444441111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555511111111111111111111111111110000000000000000000000000000 61 Individuals, partnerships, and corporations. 31,703 31,947 32,084 3311,,998800 3333333333333333333333311111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999991111111111111111111111155555555555555555555555 3333333333333333333333311111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888886666666666666666666666600000000000000000000000 33333333333333333333333333332222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000044444444444444444444444444441111111111111111111111111111 33333333333333333333333333332222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444433333333333333333333333333332222222222222222222222222222 33333333333333333333333333331111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777744444444444444444444444444441111111111111111111111111111 62 States and political subdivisions 2,051 2,014 1,981 11,,994411 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888886666666666666666666666622222222222222222222222 11111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,999999999999999999999990000000000000000000000088888888888888888888888 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888899999999999999999999999999990000000000000000000000000000 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888899999999999999999999999999999999999999999999999999999999 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888888888811111111111111111111111111117777777777777777777777777777 63 U.S. government 52 55 52 5522 4444444444444444444444488888888888888888888888 4444444444444444444444422222222222222222222222 44444444444444444444444444440000000000000000000000000000 44444444444444444444444444440000000000000000000000000000 33333333333333333333333333335555555555555555555555555555 64 Commercial banks in U.S 2,829 2,925 3,080 33,,002222 33333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111113333333333333333333333399999999999999999999999 33333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222228888888888888888888888877777777777777777777777 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333322222222222222222222222222229999999999999999999999999999 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444400000000000000000000000000002222222222222222222222222222 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333377777777777777777777777777775555555555555555555555555555 65 Foreign governments, official institutions, and banks 4,612 4,587 4,519 44,,446666 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444443333333333333333333333300000000000000000000000 44444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555557777777777777777777777700000000000000000000000 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555511111111111111111111111111114444444444444444444444444444 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,666666666666666666666666666622222222222222222222222222224444444444444444444444444444 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555544444444444444444444444444441111111111111111111111111111 66 Federal funds purchased6 20,105 22,550 20,009 2200,,888888 1111111111111111111111199999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,888888888888888888888880000000000000000000000055555555555555555555555 1111111111111111111111199999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333334444444444444444444444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,, 11111111111111111111111111119999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,333333333333333333333333333377777777777777777777777777776666666666666666666666666666 11111111111111111111111111118888888888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222266666666666666666666666666669999999999999999999999999999 11111111111111111111111111117777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111166666666666666666666666666668888888888888888888888888888 Other liabilities for borrowed money 67 Borrowings from Federal Reserve Banks 11,,440033 999999999999999999999999999977777777777777777777777777775555555555555555555555555555 111111111111111111111111111100000000000000000000000000000000000000000000000000000000 2222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,000000000000000000000000000022222222222222222222222222221111111111111111111111111111 68 Treasury tax-and-loan notes 11111,,,,,000006666655555 333339999900000 555555555555555555555555555555555555555555555555555555556666666666666666666666666666 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111122222222222222222222222222224444444444444444444444444444 1111111111111111111111111111,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222255555555555555555555555555555555555555555555555555555555 69 All other liabilities for borrowed money 4,589 4,424 5,675 55,,664433 44444,,,,,333339999966666 33333,,,,,999993333355555 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777799999999999999999999999999992222222222222222222222222222 4444444444444444444444444444,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111100000000000000000000000000004444444444444444444444444444 3333333333333333333333333333,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777777777777777777777777777777770000000000000000000000000000 70 Other liabilities and subordinated note and debentures 55,,664433 1111166666,,,,,333339999944444 1111177777,,,,,222228888811111 11111111111111111111111111117777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444400000000000000000000000000003333333333333333333333333333 11111111111111111111111111117777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555544444444444444444444444444440000000000000000000000000000 11111111111111111111111111117777777777777777777777777777,,,,,,,,,,,,,,,,,,,,,,,,,,,,111111111111111111111111111155555555555555555555555555550000000000000000000000000000 71 Total liabilities 111115555522222,,,,,777774444466666 111114444488888,,,,,888882222211111 111111111111111111111111111144444444444444444444444444449999999999999999999999999999,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222222222222222222222222222222221111111111111111111111111111 111111111111111111111111111144444444444444444444444444445555555555555555555555555555,,,,,,,,,,,,,,,,,,,,,,,,,,,,222222222222222222222222222299999999999999999999999999993333333333333333333333333333 111111111111111111111111111144444444444444444444444444448888888888888888888888888888,,,,,,,,,,,,,,,,,,,,,,,,,,,,444444444444444444444444444466666666666666666666666666662222222222222222222222222222 72 Residual (total assets minus total liabilities)7 1111122222,,,,,666662222233333 1111122222,,,,,555556666677777 11111111111111111111111111112222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555544444444444444444444444444443333333333333333333333333333 11111111111111111111111111112222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,555555555555555555555555555566666666666666666666666666668888888888888888888888888888 11111111111111111111111111112222222222222222222222222222,,,,,,,,,,,,,,,,,,,,,,,,,,,,777777777777777777777777777700000000000000000000000000007777777777777777777777777777 1 Excludes trading account securities. 5 Includes trading account securities. 2 Not available due to confidentiality. 6 Includes securities sold under agreements to repurchase. 3 Includes securities purchased under agreements to resell. 7 This is not a measure of equity capital for use in capital adequacy 4 Other than financial institutions and brokers and dealers. analysis or for other analytic uses. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Banks A23 1.30 LARGE WEEKLY REPORTING COMMERCIAL BANKS Balance Sheet Memoranda Millions of dollars, Wednesday figures 19781 1979 AAccccoouunntt Dec. 6e Dec. 13 e Dec. 20e Dec. 27 e Jan. 3p Jan. 10^ Jan. 17* Jan. 24p Jan. 31p Large weekly reporting banks with assets of $750 million or more 1 Total loans (gross) and investments adjusted2.. 434,950 434,854 439,718 439,294 445,050 443,154 441,802 438,301 440,604 2 Total loans (gross) adjusted2 338,653 337,437 342,198 341,700 345,952 334,138 342,354 338,894 341,606 3 Demand deposits adjusted3 102,374 106,006 106,460 106,360 113,234 105,374 108,451 102,924 101,932 Time deposits in accounts of $100,000 or more 4 Total 131,153 133,325 133,503 133,198 131,247 131,650 131,817 133,518 131,837 5 Negotiable CDs 95,326 97,142 97,200 96,948 96,584 96,826 96,466 97,739 96,140 6 Other time deposits 35,827 36,183 36,303 36,250 34,664 34,824 35,351 35,778 35,698 Loans sold outright to affiliates4 7 Total 3,679 3,694 3,706 3,697 3,734 3,641 3,545 3,609 3,568 8 Commercial and industrial 1,796 1,823 1,884 1,786 1,917 2,554 2,447 2,501 2,487 9 Other 1,884 1,871 1,822 1,911 1,817 1,088 1,097 1,108 1,080 Large weekly reporting banks with assets of $1 billion or more 10 Total loans (gross) and investments adjusted2. 406,927 407,070 411,682 411,295 416,643 414,272 413,403 409,985 412,182 11 Total loans (gross) adjusted 2 318,461 317,525 322,020 321,594 324,830 322,694 321,218 317,826 320,489 12 Demand deposits adjusted 3 95,025 98,536 98,890 98,874 105,442 97,536 100,831 95,914 94,786 Time deposits in accounts of $100,000 or more 13 Total 123,814 125,933 126,102 125,796 123,873 124,270 124,334 125,973 124,271 14 Negotiable CDs 91,070 92,861 92,918 92,642 92,271 92,248 91,949 93,148 91,486 15 Other time deposits 32,743 33,072 33,183 33,154 31,602 32,022 32,385 32,825 32,785 Loans sold outright to affiliates4 16 Total 3,629 3,643 3,657 3,644 3,692 3,598 3,502 3,566 3,526 17 Commercial and industrial 1,770 1,797 1,860 1,755 1,899 2,534 2,429 2,482 2,470 18 Other 1,859 1,846 1,797 1,889 1,793 1,065 1,074 1,084 1,056 Large weekly reporting banks in New York City 19 Total loans (gross) and investments adjusted2- 5 95,726 93,809 93,070 91,822 92,644 20 Total loans (gross) adjusted2 78,011 78,349 80,069 79,932 77,974 76,306 75,644 74,641 75,542 21 Demand deposits adjusted3 23,045 24,924 25,358 24,479 26,931 21,424 24,207 24,657 23,259 Time deposits in accounts of $100,000 or more 22 Total 36,296 36,545 36,714 36,470 36,237 36,645 36,815 37,314 36,422 23 Negotiable CDs 29,214 29,463 29,632 29,394 29,137 29,489 29,596 30,113 29,139 24 Other time deposits 7,082 7,082 7,082 7,076 7,100 7,156 7,220 7,201 7,282 1 Data revised to conform with new coverage basis for 1979. Data 4 Loans sold are those sold outright to a bank's own foreign branches, shown only for items that are conceptually comparable with those for nonconsolidated nonbank affiliates of the bank, the bank's holding com- 1979. pany (if not a bank) and nonconsolidated nonbank subsidiaries of the 2 Exclusive of loans and federal funds transactions with domestic com- holding company. mercial banks. 5 Excludes trading account securities. 3 All demand deposits except U.S. government and domestic banks less cash items in process of collection. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 Domestic Nonfinancial Statistics • February 1979 1.31 LARGE WEEKLY REPORTING COMMERCIAL BANKS Commercial and Industrial Loans Millions of dollars Outstanding Net change during— IInndduussttrryy ccllaassssiiffiiccaattiioonn 1978 1978 1978 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27 Q3 Q4 Oct. Nov. Dec. Total loans classified2 1 Total 114,541 114,799 114,549 115,578 115,773 1,354 4,323 1,863 1,228 1,232 Durable goods manufacturing: 2 Primary metals 2,595 2,624 2,643 2,672 2,662 -66 -70 -68 -69 67 3 Machinery 5,473 5,513 5,415 5,408 5,348 -16 -40 61 24 -125 4 Transportation equipment 2,627 2,571 2,593 3,110 3,096 -52 349 -159 39 469 5 Other fabricated metal products... 2,414 2,451 2,447 2,405 2,471 69 -51 -78 -30 57 6 Other durable goods 3,986 4,062 4,050 4,046 3,992 136 -53 -79 20 6 Nondurable goods manufacturing: 7 Food, liquor, and tobacco 4,550 4,642 4,628 4,613 4,681 -101 527 186 210 131 8 Textiles, apparel, and leather 3,976 3,999 3,930 3,833 3,756 240 -627 -110 -297 -220 9 Petroleum refining 2,552 2,569 2,570 2,660 2,634 -116 113 -47 78 82 10 Chemicals and rubber 3,232 3,275 3,357 3,453 3,465 -101 -3 -173 -63 233 11 Other nondurable goods 2,440 2,424 2,405 2,400 2,380 213 -100 -47 7 -60 12 Mining, including crude petroleum 10,622 10,594 10,607 10,629 10,585 172 8 17 28 -37 Trade: 13 Commodity dealers 1,793 1,859 1,870 1,872 1,952 -323 208 61 -12 159 14 Other wholesale 9,530 9,502 9,443 9,433 9,367 232 195 279 79 -163 15 Retail 8,939 8,855 8,711 8,557 8,412 -80 218 636 109 -527 16 Transportation 5,520 5,494 5,515 5,469 5,494 53 34 -8 -26 1,774 1,782 1,748 1,772 1,765 68 32 -20 61 -9 18 Other public utilities 5,545 5,587 5,586 5,741 5,940 89 841 245 201 395 19 Construction 5,106 5,040 5,031 5,035 5,098 118 -73 -16 -49 -8 20 Services 14,422 14,509 14,484 14,750 14,749 520 790 219 244 327 21 All other domestic loans 8,458 8,449 8,473 8,392 8,537 282 501 257 165 79 22 Bankers acceptances 3,542 3,591 3,543 3,766 3,809 -149 697 210 220 267 23 Foreign commercial and industrial loans 5,445 5,407 5,500 5,562 5,580 166 861 455 271 135 MEMO ITEMS: 24 Commercial paper included in total classified loansi. ... 6622 4455 -8 --1188 --1177 25 Total commercial and industrial loans of all large weekly reporting banks 140,658 140,655 140,557 141,829 142,103 1,390 5,394 2,125 1,824 1,445 1978 1978 1978 Aug. 30 Sept. 27 Oct. 25 Nov. 29 Dec. 27 Q3 Q4 Oct. Nov. Dec. "Term" loans classified3 26 Total 52,618 53,019 53,762 54,861 55,481 1,726 2,463 743 1,099 620 Durable goods manufacturing: 27 Primary metals 1,710 1,672 1,641 1,631 1,624 -34 -48 -31 -10 -7 28 Machinery 2,669 2,650 2,768 2,751 2,771 74 121 118 -17 20 29 Transportation equipment 1,586 1,565 1,506 1,517 1,664 145 99 -59 11 147 30 Other fabricated metal products.. 990 1,007 1,004 1,040 1,119 13 112 -3 36 79 31 Other durable goods 1,699 1,713 1,717 1,815 1,902 35 189 4 98 87 Nondurable goods manufacturing: 32 Food, liquor, and tobacco 1,740 1,727 1,862 1,978 1,918 56 191 135 116 -60 33 Textiles, apparel, and leather 1,133 1,126 1,096 1,046 1,050 4 -76 -30 -50 4 34 Petroleum refining 1,882 1,846 1,789 1,843 1,895 -101 49 -57 54 52 35 Chemicals and rubber 2,322 2,301 2,109 2,043 2,181 -111 -120 -192 -66 138 36 Other nondurable goods 1,156 1,177 1,192 1,218 1,183 86 6 15 26 -35 37 Mining, including crude petroleum and natural gas 7,757 7,862 7,852 7,930 7,937 102 75 -10 78 7 Trade: 38 Commodity dealers 248 250 268 305 313 22 63 18 37 8 39 Other wholesale 2,276 2,360 2,329 2,372 2,342 185 -18 -31 43 -30 40 Retail 2,827 2,791 3,065 3,225 3,204 -43 413 274 160 -21 41 Transportation 3,732 3,753 3,718 3,746 3,790 15 37 -35 28 44 42 Communication 1,057 1,076 1,065 1,131 1,158 67 82 -11 66 27 43 Other public utilities 3,860 3,847 3,960 4,064 4,221 318 374 113 104 157 44 Construction 2,245 2,224 2,264 2,295 2,373 107 149 40 31 78 45 Services 6,606 6,797 6,936 7,113 7,270 307 473 139 177 157 46 All other domestic loans 2,616 2,713 2,798 2,857 2,908 393 196 85 59 51 47 Foreign commercial and industrial loans 2,507 2,562 2,823 2,941 2,658 86 96 261 118 -283 1 Reported for the last Wednesday of each month. all outstanding loans granted under a formal agreement—revolving credit 2 Includes "term" loans, shown below. or standby—on which the original maturity of the commitment was in 3 Outstanding loans with an original maturity of more than 1 year and excess of 1 year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Deposits and Commercial Paper A25 1.32 GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations Billions of dollars, estimated daily-average balances At commercial banks TTTyyypppeee ooofff hhhooollldddeeerrr 1977 1978 11997744 11997755 11997766 DDeecc.. DDeecc.. DDeecc.. June Sept. Dec. Mar. June Sept. Dec. 11111 AAAAAllllllllll hhhhhooooollllldddddeeeeerrrrrsssss,,,,, iiiiinnnnndddddiiiiivvvvviiiiiddddduuuuuaaaaalllllsssss,,,,, pppppaaaaarrrrrtttttnnnnneeeeerrrrrssssshhhhhiiiiipppppsssss,,,,, aaaaannnnnddddd 225.0 236.9 250.1 253.8 252.7 274.4 262.5 271.2 278.8 294.6 22222 FFFFFiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 19.0 20.1 22.3 25.9 23.7 25.0 24.5 25.7 25.9 27.8 118.8 125.1 130.2 129.2 128.5 142.9 131.5 137.7 142.5 152.7 44444 CCCCCooooonnnnnsssssuuuuummmmmeeeeerrrrr 73.3 78.0 82.6 84.1 86.2 91.0 91.8 92.9 95.0 97.4 2.3 2.4 2.7 2.5 2.5 2.5 2.4 2.4 2.5 2.7 66666 OOOOOttttthhhhheeeeerrrrr 11.7 11.3 12.4 12.2 11.8 12.9 12.3 12.4 13.1 14.1 At weekly reporting banks 1978 11997755 11997766 11997777 DDeecc.. DDeecc.. DDeecc.. June July Aug. Sept. Oct. Nov. Dec. 77777 AAAAAllllllllll hhhhhooooollllldddddeeeeerrrrrsssss,,,,, iiiiinnnnndddddiiiiivvvvviiiiiddddduuuuuaaaaalllllsssss,,,,, pppppaaaaarrrrrtttttnnnnneeeeerrrrrssssshhhhhiiiiipppppsssss,,,,, aaaaannnnnddddd 124.4 128.5 139.1 136.9 139.9 137.7 139.7 141.3 142.7 147.0 88888 FFFFFiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 15.6 17.5 18.5 19.0 19.4 19.4 18.9 19.1 19.3 19.8 99999 NNNNNooooonnnnnfffffiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 69.9 69.7 76.3 71.9 73.7 72.0 74.1 75.0 75.7 79.0 29.9 31.7 34.6 36.6 37.1 36.8 37.1 37.5 37.7 38.2 2.3 2.6 2.4 2.3 2.3 2.4 2.4 2.5 2.5 2.5 1111122222 OOOOOttttthhhhheeeeerrrrr 6.6 7.1 7.4 7.1 7.3 7.1 7.3 7.2 7.5 7.5 NOTE. Figures include cash items in process of collection. Estimates of banks. Types of depositors in each category are described in the June 1971 gross deposits are based on reports supplied by a sample of commercial BULLETIN, p. 466. 1.33 COMMERCIAL PAPER AND BANKERS ACCEPTANCES OUTSTANDING Millions of dollars, end of period 1978 11997755 11997766 11997777 IInnssttrruummeenntt DDeecc.. DDeecc.. DDeecc.. June July Aug. Sept. Oct. Nov. Dec. Commercial paper (seasonally adjusted) I 48,459 53,025 65,209 74,536 74,900 73,960 76,988 77,152 80,504 83,817 FFFFiiiinnnnaaaannnncccciiiiaaaallll ccccoooommmmppppaaaannnniiiieeeessss::::1111 DDDDeeeeaaaalllleeeerrrr----ppppllllaaaacccceeeedddd ppppaaaappppeeeerrrr::::2222 2222 TTTToooottttaaaallll 6,202 7,250 8,871 10,327 10,617 10,868 11,470 10,921 11,455 12,280 1,762 1,900 2,132 2,442 2,633 2,935 2,622 2,868 3,231 3,521 DDDDiiiirrrreeeeccccttttllllyyyy----ppppllllaaaacccceeeedddd ppppaaaappppeeeerrrr::::3333 4444 TTTToooottttaaaallll 31,374 32,500 40,496 47,315 46,594 45,510 47,791 48,030 50,010 51,625 5555 BBBBaaaannnnkkkk----rrrreeeellllaaaatttteeeedddd 6,892 5,959 7,102 9,585 10,030 9,634 10,383 10,925 11,478 12,314 10,883 13,275 15,842 16,894 17,689 17,582 17,727 18,201 19,039 19,912 Dollar acceptances (not seasonally adjusted) 7777 TTTToooottttaaaallll 1188,,772277 2222,,552233 rr2255,,445500 2288,,228899 27,579 28,319 2277,,995522 30,579 32,145 3333,,770000 HHHHeeeelllldddd bbbbyyyy:::: 8888 AAAAcccccccceeeeppppttttiiiinnnngggg bbbbaaaannnnkkkkssss 77,,333333 1100,,444422 1100,,443344 77,,550022 7,244 7,048 77..664477 8,379 r8,082 88,,557799 9999 OOOOwwwwnnnn bbbbiiiillllllllssss 55,,889999 88,,776699 88,,991155 66,,552200 6,345 6,131 66,,446611 7,012 r6,840 77,,665533 11110000 BBBBiiiillllllllssss bbbboooouuuugggghhhhtttt 11,,443355 11,,667733 11,,551199 998833 899 917 11,,118866 1,366 1,243 992277 FFFFeeeeddddeeeerrrraaaallll RRRReeeesssseeeerrrrvvvveeee BBBBaaaannnnkkkkssss:::: 11111111 OOOOwwwwnnnn aaaaccccccccoooouuuunnnntttt 11,,112266 999911 995544 11 12 Foreign correspondents 229933 337755 336622 662255 568 633 555566 557 585 666644 13 Others 99,,997755 1100,,771155 1133,,990044 2200,,116600 19,766 20,638 1199,,774488 21,644 r23,478 2244,,445566 Based on: 14 Imports into United States 33,,772266 44,,999922 rr66,,337788 77,,557788 7,415 7,885 77,,995577 8,575 8,675 88,,557744 15 Exports from United States 44,,000011 44,,881188 rr55,,886633 66,,990066 6,565 6,558 66,,335500 6,665 7,224 77,,558866 16 All other 1111,,000000 1122,,771133 rr1133,,220099 1133,,880055 13,599 13,876 1133,,664444 15,339 16,245 1177,,554400 1 Institutions engaged primarily in activities such as, but not limited to, 3 As reported by financial companies that place their paper directly commercial, savings, and mortgage banking; sales, personal, and mortgage with investors. financing; factoring, finance leasing, and other business lending; insurance 4 Includes public utilities and firms engaged primarily in activities such underwriting; and other investment activities. as communications, construction, manufacturing, mining, wholesale and 2 Includes all financial company paper sold by dealers in the open retail trade, transportation, and services. market. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A26 Domestic Nonfinancial Statistics • February 1979 1.34 PRIME RATE CHARGED BY BANKS on Short-term Business Loans Per cent per annum Month Average Month Effective date Rate Effective date Rate rate 1978—Jan. 10. 1978—Sept. 15 9Vi 1977—Apr . 6.25 1978—Mar. May 5 8% 28 9V 4 J M u a n y e . . 6 6 . . 7 4 5 1 A M p a r y . 26, 8I/2 Oct. 13 10 July. 6.75 June 27 Id/4 Aug.: 6.83 July. June 16 8% Sept.. 7.13 Aug. 30 9 Nov. 1 101/2 Oct... 7.52 Sept. Aug. 31. 9Va 1 6 7 n \o y 4 D N e o c v . . 7 7 . . 7 7 5 5 N O o c v t. . . 24 l n/ 2 Dec. 1978—Jan 7.93 Dec. 26 113/4 Feb 8.00 1979—Jan.. 1.35 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, November 6-11, 1978 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) 9,533,752 735,419 493,312 595,003 1,867,088 680,499 5,162,431 2 Number of loans 143,729 105,705 15,165 9,331 11,360 1,105 1,063 3 Weighted-average maturity (months) 3.0 2.9 2.7 2.7 3.1 3.4 3.1 4 Weighted-average interest rate (percent per annum) 11.44 11.73 11.73 11.43 11.53 11.19 11.37 5 Interquartile range1 10.92-12.10 10.38-13.29 10.50-12.75 10.37-12.62 10.76-12.25 10.25-11.73 11.00-11.85 Percent of amount of loans: 6 With floating rate 64.4 27. 1 26.4 35.0 50.1 69.3 81.2 7 Made under commitment 36.2 17.3 20.7 31.8 42.8 70.0 34.1 Long-term commercial and industrial loans 8 Amount of loans (thousands of dollars) 1,177,815 288,653 222,967 121,987 544,208 9 Number of loans 18,903 17,174 1,403 172 155 10 Weighted-average maturity (months) 43.2 30.6 44.4 42.1 49.6 11 Weighted-average interest rate (percent per annum) 11.38 11.41 11.93 11.58 11.09 12 Interquartile range1 10.47-12.50 10.47-12.40 11.00-12.88 10.75-12.68 10.00-12.13 Percentage of amount of loans: 13 With floating rate 61.2 40.1 68.4 62.8 69.0 14 Made under commitment 60.8 42.3 40.3 69.1 77.1 Construction and land development loans 15 Amount of loans (thousands of dollars) 1,012,101 167,317 111,087 116,176 403,138 214,383 16 Number of loans 25,510 18,633 3,155 1,766 1,800 157 17 Weighted-average maturity (months) 7.7 4.2 4.0 5.5 8.7 11.8 18 Weighted-average interest rate (percent per annum) 11.55 10.82 11.46 11.65 11.90 11.46 19 Interquartile range1 10.50-12.50 9.92-12.13 10.29-12.68 10.56-12.62 11.75-12.36 10.50-12.75 Percentage of amount of loans: 20 With floating rate 42.7 19.8 18.9 23.9 59.6 51.4 21 Secured by real estate 94.2 89.1 95.8 95.2 95.4 94.7 22 Made under commitment 60.4 66.3 88.7 31.7 52.8 70.9 23 Type of construction: 1- to 4-family 38.2 86.9 85.5 32.5 14.0 24.5 24 Multifamily 15.4 1.0 1.5 3.3 27.6 17.5 25 Nonresidential 46.3 12.1 13.0 64.2 58.4 57.9 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) 949,031 134,907 186,760 169,744 156,770 171,536 129,314 27 Number of loans 58,275 36,846 12,625 5,009 2,386 1,198 211 28 Weighted-average maturity (months) 7.4 7.5 8.9 8.0 6.4 8.0 4.7 29 Weighted-average interest rate (percent per annum) 10.36 9.94 9.98 9.91 10.25 10.66 11.69 30 Interquartile range1 9.50-10.80 9.20-10.47 9.20-10.50 9.24-10.38 9.73-10.50 9.99-11.57 10.47-12.69 By purpose of loan: 31 Feeder livestock 10.23 9.74 9.82 9.64 10.20 10.15 11.74 32 Other livestock 10.80 9.81 10.03 10.81 10.37 11.40 12.33 33 Other current operating expenses 10.27 9.87 9.83 10.02 10.33 11.03 11.42 34 Farm machinery and equipment 10.29 10.12 10.51 9.80 9.78 10.76 ( 2 ) 35 Other 10.72 10.34 "0.46 10.18 10.20 10.96 11.78 1 Interest rate range that covers the middle 50 percent of the total NOTE. For more detail, see the board's 416 (G.14) statistical release, dollar amount of loans made. The past data have been revised and are available from Publications 2 Fewer than three sample loans. Services, Division of Support Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Markets All 1.36 INTEREST RATES Money and Capital Markets Averages, per cent per annum 1978 1979 1979, week ending— Instrument 1976 1977 1978 Oct. Nov. Dec. Jan. Jan. 6 Jan. 13 Jan. 20 Jan. 27 Feb. 3 Money market rates 1 Federal funds1 5.05 5.54 7.94 8.96 9.76 10.03 10.07 10.59 9.97 10.05 10.05 10.12 Prime commercial paper2-3 2 90- to 119-day 5.24 5.54 7.94 8.98 10.14 10.37 10.25 10.48 10.34 10.28 10.09 9.99 3 4- to 6-month 5.35 5.60 7.99 9.03 10.23 10.43 10.32 10.55 10.40 10.36 10.16 10.07 4 Finance company paper, directly placed, 3- to 6-month3-4 5.22 5.49 7.78 8.78 9.82 10.06 10.10 10.24 10.19 10.15 9.98 9.86 5 Prime bankers acceptances, 90-day3-5 5.19 5.59 8.11 9.32 10.53 10.55 10.29 10.65 10.41 10.29 10.11 9.92 Large negotiable certificates of deposit 6 3-month, secondary market6 5.26 5.58 8.20 9.14 10.72 10.72 10.51 10.88 10.71 10.49 10.44 10.20 7 Eurodollar deposits, 3-month7 5.57 6.05 8.74 10.12 11.51 11.62 11.16 11.81 11.46 11.21 11.05 10.65 U.S. government securities Bills:3- 8 Market yields: 8 3-month 4.98 5.27 7.19 7.99 8.64 9.08 9.35 9.34 9.30 9.44 9.34 9.28 9 6-month 5.26 5.53 7.58 8.55 9.24 9.36 9.47 9.45 9.50 9.56 9.44 9.34 10 1-year 5.52 5.71 7.74 8.45 9.20 9.44 9.54 9.61 9.61 9.61 9.46 9.31 Rates on new issue:9 11 3-month 4.989 5.265 7.221 8.132 8.787 9.122 9.351 9.388 9.316 9.411 9.289 9.324 12 6-month 5.266 5.510 7.572 8.493 9.204 9.397 9.501 9.550 9.443 9.534 9.475 9.376 Capital market rates Government notes and bonds U.S. Treasury Constant maturities:10 13 1-year 5.88 6.09 8.34 9.14 10.01 10.30 10.41 10.51 10.51 10.50 10.31 10.13 14 2-year 6.45 8.34 8.85 9.42 9.72 9.86 9.93 9.92 9.91 9.80 9.62 15 3-year 6.77 6.69 8.29 8.62 9.04 9.33 9.50 9.58 9.60 9.59 9.42 9.15 16 5-year 7.18 6.99 8.32 8.61 8.84 9.08 9.20 9.30 9.30 9.26 9.10 8.94 17 7-year 7.42 7.23 8.36 8.64 8.80 9.03 9.14 9.21 9.22 9.21 9.06 8.93 18 10-year 7.61 7.42 8.41 8.64 8.81 9.01 9.10 9.14 9.15 9.16 9.04 8.94 19 20-year 7.86 7.67 8.48 8.69 8.75 8.90 8.98 8.99 9.01 9.03 8.95 8.89 2200 30-year 88..4499 88..6677 88..7755 8.88 88..9944 88..9966 88..9988 88..9988 88..8899 88..8855 Notes and bonds maturing in—11 21 3 to 5 years 6.94 6.85 8.30 8.61 8.97 9.23 9.36 9.46 9.46 9.43 9.27 9.02 22 Over 10 years (long-term) 6.78 7.06 7."89 8.07 8.16 8.36 8.43 8.44 8.47 8.46 8.39 8.32 State and local: Moody's series12 23 Aaa 5.66 5.20 5.52 5.53 5.59 5.91 5.95 6.05 6.00 6.00 5.75 5.70 24 Baa 7.49 6.12 6.27 6.18 6.65 6.76 7.14 7.50 7.30 7.00 6.75 7.00 25 Bond Buyer series13 6.64 5.68 6.03 6.13 6.19 6.51 6.47 6.58 6.50 6.48 6.30 6.22 Corporate bonds Seasoned issues14 26 All industries 9.01 8.43 9.07 9.20 9.40 9.49 9.65 9.64 9.65 9.67 9.65 9.60 By rating groups: 2277 Aaa 8.43 8.02 8.73 8.89 9.03 9.16 9.25 9.26 9.26 9.28 9.24 9.19 28 Aa 8.75 8.24 8.92 9.07 9.24 9.33 9.48 9.48 9.49 9.50 9.47 9.43 29 A 9.09 8.49 9.12 9.26 9.48 9.53 9.72 9.67 9.70 9.73 9.78 9.72 30 Baa 9.75 8.97 9.45 9.59 9.83 9.94 10.13 10.15 10.17 10.15 10.10 10.07 Aaa utility bonds:15 31 New issue 8.48 8.19 8.96 9.17 9.27 9.28 9.54 9.54 32 Recently offered issues 8.49 8.19 8.97 9.13 9.27 9.41 9.51 9.51 9.55 9.57 9.45 9.41 Dividend/price ratio 33 Preferred stocks 7.97 7.60 8.25 8.29 8.43 8.84 8.79 8.83 8.86 8.89 8.74 8.65 34 Common stocks 3.77 4.56 5.28 5.11 5.45 5.39 5.29 5.33 5.28 5.25 5.24 5.33 1 Weekly figures are 7-day averages of daily effective rates for the week 9 Rates are recorded in the week in which bills are issued. ending Wednesday; the daily effective rate is an average of the rates on 10 Yields on the more actively traded issues adjusted to constant a given day weighted by the volume of transactions at these rates. maturities by the U.S. Treasury, based on daily closing bid prices. 2 Beginning Nov. 1977, unweighted average of offering rates quoted 11 Unweighted averages for all outstanding notes and bonds in maturity by five dealers. Previously, most representative rate quoted by those ranges shown, based on daily closing bid prices. "Long-term" includes dealers. all bonds neither due nor callable in less than 10 years, including a num- 3 Yields are quoted on a bank-discount basis. ber of very low yielding "flower" bonds. 4 Averages of the most representative daily offering rates published by 12 General obligations only, based on figures for Thursday, from finance companies for varying maturities in this range. Moody's Investors Service. 5 Average of the midpoint of the range of daily dealer closing rates 13 Twenty issues of mixed quality. offered for domestic issues. 14 Averages of daily figures from Moody's Investors Service. 6 Weekly figures (week ending Wednesday) are 7-day averages of the 15 Compilation of the Board of Governors of the Federal Reserve daily midpoints as determined from the range of offering rates; monthly System. figures are averages of total days in the month. Beginning Apr. 5, 1978, Issues included are long-term (20 years or more). New-issue yields weekly figures are simple averages of offering rates. are based on quotations on date of offering; those on recently offered 7 Averages of daily quotations for the week ending Wednesday. issues (included only for first 4 weeks after termination of underwriter 8 Except for new bill issues, yields are computed from daily closing price restrictions), on Friday close-of-business quotations. bid prices. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic Nonfinancial Statistics • February 1979 1.37 STOCK MARKET Selected Statistics 1978 1979 Indicator 1976 1977 1978 July Aug. Sept. Oct. Nov. Dec. Jan. Prices and trading (averages of daily figures) Common stock prices 1 New York Stock Exchange (Dec. 31,1965 = 50). 54.45 53.67 53.76 54.61 58.53 58.58 56.40 52.74 53.69 55.76 60.44 57.84 58.30 59.35 64.07 64.23 61.60 57.50 58.72 61.31 39.57 41.07 43.25 44.74 49.45 50.19 46.70 41.80 42.49 43.69 4 Utility 36.97 40.91 39.23 39.28 40.20 39.82 39.44 37.88 38.09 38.79 52.94 55.23 56.74 57.97 63.28 63.22 60.42 54.95 55.73 57.59 6 Standard & Poor's Corporation (1941-43 = 10) i.. 102.01 98.18 96.11 97.19 103.92 103.86 100.58 94.71 96.10 99.70 7 American Stock Exchange (Aug. 31,1973 = 100). 101.63 116.18 144.56 149.87 162.52 170.95 160.14 144.17 149.94 159.26 Volume of trading (thousands of shares)2 8 New York Stock Exchange 21,189 20,936 28,591 27,074 37,603 33,612 31,020 24,505 24,622 27,988 9 American Stock Exchange 2,565 2,514 3,922 3,496 5,526 5,740 4,544 3,304 3,430 3,150 Customer financing (end-of-period balances, in millions of dollars) 10 Regulated margin credit at brokers/dealers3 8888888,,,,,,,111111166666666666666 9999999,,,,,,,999999999999993333333 11111111111111,,,,,,,444444433333338888888 11111111111111,,,,,,,999999988888884444444 11111112222222,,,,,,,666666622222226666666 11111112222222,,,,,,,333333300000007777777 11111111,,,,222200009999 11111111111111,,,,,,,000000033333335555555 11 Margin stock4 7777777,,,,,,,999999966666660000000 9999999,,,,,,,777777744444440000000 11111111111111,,,,,,,111111199999990000000 11111111111111,,,,,,,777777744444440000000 11111112222222,,,,,,,444444400000000000000 11111112222222,,,,,,,000000099999990000000 11111111,,,,000000000000 11111110000000,,,,,,,888888833333330000000 12 Convertible bonds 222222200000004444444 222222255555550000000 222222244444447777777 222222244444443333333 222222222222225555555 222222211111116666666 222200009999 222222200000005555555 13 Subscription issues 2222222 3333333 1111111 1111111 1111111 MEMO: Free credit balances at brokers® 14 Margin-account 555555588888885555555 666666644444440000000 777777711111110000000 777777799999995555555 888888822222225555555 888888888888885555555 777999000 888888833333335555555 15 Cash-account 1111111,,,,,,,888888855555555555555 2222222,,,,,,,000000066666660000000 2222222,,,,,,,222222299999995555555 2222222,,,,,,,555555555555555555555 2222222,,,,,,,666666655555555555555 2222222,,,,,,,444444466666665555555 222,,,333000555 2222222,,,,,,,555555511111110000000 Margin-account debt at brokers (percentage distribution, end of period) 111666 TTToootttaaalll 111111110000000000000000........00000000 111111110000000000000000........00000000 111111110000000000000000........00000000 111111110000000000000000........00000000 111111110000000000000000........00000000 111111110000000000000000........00000000 111111110000000000000000........00000000 111111110000000000000000........00000000 By equity class (in percent):7 17 Under 40 1111111122222222........00000000 1111111188888888........00000000 1111111133333333........00000000 1111111122222222........00000000 1111111155555555........00000000 4444444477777777........00000000 3333333322222222........00000000 3333333333333333........00000000 18 40-49 2222222233333333........00000000 3333333366666666........00000000 3333333344444444........00000000 3333333344444444........00000000 3333333366666666........00000000 2222222200000000........00000000 2222222277777777........00000000 2222222288888888........00000000 19 50-59 3333333355555555........00000000 2222222233333333........00000000 2222222255555555........00000000 2222222233333333........00000000 2222222233333333........00000000 1111111155555555........00000000 2222222200000000........00000000 1111111188888888........00000000 20 60-69 1111111155555555........00000000 1111111111111111........00000000 1111111144444444........00000000 1111111166666666........00000000 1111111133333333........00000000 88888888........00000000 1111111100000000........00000000 1111111100000000........00000000 21 70-79 88888888........77777777 66666666........00000000 88888888........00000000 99999999........00000000 77777777........00000000 55555555........00000000 66666666........00000000 66666666........00000000 22 80 or more 66666666........00000000 55555555........00000000 66666666........00000000 66666666........00000000 66666666........00000000 55555555........00000000 55555555........00000000 55555555........00000000 Special miscellaneous-account balances at brokers (end of period) 23 Total balances (millions of dollars) 8.. 88888,,,,,777777777766666 99999,,,,,999991111100000 Distribution by equity status (percent) 24 Net credit status 4444411111.....33333 4444433333.....44444 Debit status, equity of— 25 60 percent or more 4444477777.....88888 4444444444.....99999 26 Less than 60 percent 1111100000.....99999 1111111111.....77777 Margin requirements (percent of market value)9 Effective date Mar. 11, 1968 June 8, 1968 May 6, 1970 Dec. 6, 1971 Nov. 24, 1972 Jan. 3, 1974 27 Margin stocks 70 80 65 55 65 50 28 Convertible bonds 50 60 50 50 50 50 29 Short sales 70 80 65 55 65 50 1 Effective July 1976, includes a new financial group, banks and in- 7 Each customer's equity in his collateral (market value of collateral surance companies. With this change the index includes 400 industrial less net debit balance) is expressed as a percentage of current collateral stocks (formerly 425), 20 transportation (formerly 15 rail), 40 public values. utility (formerly 60), and 40 financial. 8 Balances that may be used by customers as the margin deposit re- 2 Based on trading for a 5^-hour day. quired for additional purchases. Balances may arise as transfers based 3 Margin credit includes all credit extended to purchase or carry on loan values of other collateral in the customer's margin account or stocks or related equity instruments and secured at least in part by stock. deposits of cash (usually sales proceeds) occur. Credit extended is end-of-month data for member firms of the New York 9 Regulations G, T, and U of the Federal Reserve Board of Governors, Stock Exchange. prescribed in accordance with the Securities Exchange Act or 1934, In addition to assigning a current loan value to margin stock generally, limit the amount of credit to purchase and carry margin stocks that may Regulations T and U permit special loan values for convertible bonds be extended on securities as collateral by prescribing a maximum loan and stock acquired through exercise of subscription rights. value, which is a specified percentage of the market value of the collateral 4 A distribution of this total by equity class is shown on lines 23-28. at the time the credit is extended. Margin requirements are the difference 5 Nonmargin stocks are those not listed on a national securities ex- between the market value (100 percent) and the maximum loan value. The change and not included on the Federal Reserve System's list of over-the- term "margin stocks" is defined in the corresponding regulation. counter margin stocks. At brokers, such stocks have no loan value. Regulation G and special margin requirements for bonds convertible 6 Free credit balances are in accounts with no unfulfilled commitments into stocks were adopted by the Board of Governors effective Mar. 11, to the brokers and are subject to withdrawal by customers on demand. 1968. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Thrift Institutions A29 1.38 SAVINGS INSTITUTIONS Selected Assets and Liabilities Millions of dollars, end of period 1978 11997755 11997766 11997777 Account Apr. May June July Aug. Sept. Oct. Nov.r Dec.* Savings and loan associations9 1 Assets 338,233 391,907 459,241 480,947 487,052 491,576 498,301 504,298 508,977 515,352 520,677 523,784 2 Mortgages 278,590 323,005 381,163 397,284 402,305 407,965 411,956 416,677 420,971 425,236 429,420 432,922 3 Cash and investment securities1 30,853 35,724 39,150 41,853 42,444 41,505 43,627 44,188 43,987 4455,,557777 4455,,886699 4444,,996644 4 Other 28,790 33,178 38,928 41,810 42,303 42,106 42,718 43,433 44,019 44,539 45,388 45,898 5 Liabilities and net worth 338,233 391,907 459,241 480,947 487,052 491,576 498,301 504,298 508,977 515,352 520,677 523,784 6 Savings capital 285,743 335,912 386,800 399,550 401,930 408,586 411,660 413,972 420,405 423,050 425,207 431,102 7 Borrowed money 20,634 19,083 27,840 31,904 32,759 34,270 35,730 37,219 38,595 39,873 40,711 42,950 8 FHLBB 17,524 15,708 19,945 22,692 23,323 24,875 26,151 27,363 28,632 29,456 30,052 32,052 9 Other 3,110 3,375 7,895 9,212 9,436 9,395 9,579 9,856 9,963 10,417 10,659 10,898 5,128 6,840 9,911 10,937 11,386 11,632 11,540 11,422 11,222 11,165 11,315 10,734 11 Other 6,949 8,074 9,506 12,186 14,239 10,046 11,972 13,906 10,676 12,832 14,666 9,958 12 Net worth2 19,779 21,998 25,184 26,370 26,738 27,042 27,399 27,779 28,079 28,432 28,808 29,040 13 MEMO : Mortgage loan commitments outstanding 3.. 10,673 14,826 19,875 23,398 23,939 22,927 22,393 22,047 21,648 2211,,550033 20,738 18,734 Mutual savings banks10 14 Assets 121,056 134,812 147,287 151,383 152,202 153,175 154,315 155,210 156,110 156,843 157,436 n.a. Loans: 15 Mortgage 77,221 81,630 88,195 90,346 90,915 91,555 92,230 92,866 93,403 93,903 94,497 n.a. 16 Other 44,,002233 5,183 6,210 7,422 7,907 7,771 8,207 8,379 8,418 8,272 7,921 n.a. Securities: 17 U.S. government 4,740 5,840 5,895 5,670 5,491 5,304 5,269 5,210 5,172 5,105 5,035 n.a. 18 State and local government. 1,545 2,417 2,828 2,915 2,994 3,008 3,025 3,098 3,180 3,190 3,307 n.a. 19 Corporate and other4 27,992 33,793 37,918 39,146 39,225 39,427 39,639 39,592 39,639 39,651 39,679 n.a. 20 Cash 2,330 2,355 2,401 1,940 1,798 2,163 2,029 2,080 2,293 2,735 3,033 n.a. 21 Other assets 3,205 3,593 3,839 3,945 3,873 3,946 3,915 3,985 4,006 3,988 3,962 n.a. 22 Liabilities 121,056 134,812 147,287 151,383 152,202 153,175 154,315 155,210 156,110 156,843 157,436 n.a. 23 Deposits 109,873 122,877 134,017 136,931 137,307 138,709 139,128 139,308 140,816 141,026 141,155 n.a. 24 Regular: 5 109,291 121,961 132,744 135,349 135,785 137,089 137,430 137,690 139,068 139,422 139,697 n.a. 25 Ordinary savings 69,653 74,535 78,005 78,170 78,273 77,321 76,116 75,578 75,423 74,124 72,398 n.a. 26 Time and other 39,639 47,426 54,739 57,179 57,512 59,768 61,313 62,112 63,645 65,298 67,299 n.a. 27 Other 582 916 1,272 1,582 1,521 1,620 1,698 1,619 1,747 1,604 1,458 n.a. 28 Other liabilities 2,755 2,884 3,292 4,152 4,481 3,969 4,636 5,246 4,570 5,040 5,411 n.a. 29 General reserve accounts 88,,442288 9,052 9,978 10,301 10,414 10,497 10,551 10,654 10,725 10,777 10,870 n.a. 30 MEMO : Mortgage loan commitments outstanding6.. 1,803 2,439 4,066 4,342 4,606 4,958 4,872 4,789 4,561 4,843 4,823 n.a. Life insurance companies i 31 Assets 289,304 321,552 351,722 363,269 366,938 369,879 374,415 378,124 381,050 382,446 385,562 n.a. Securities: 32 Government 13,758 17,942 19,553 19,330 19,489 19,401 19,447 19,563 19,638 19,757 19,711 n.a. 33 United States7 4,736 5,368 5,315 5,087 5,206 4,984 5,006 5,155 5,156 5,183 4,934 n.a. 34 State and local 4,508 5,594 6,051 5,923 5,915 5,943 5,925 5,884 6,001 6,035 6,235 n.a. 35 Foreign8 4,514 6,980 8,187 8,320 8,368 8,474 8,516 8,524 8,481 8,539 8,542 n.a. 36 Business 135,317 157,246 175,654 184,917 187,126 188,500 192,112 194,620 196,152 195,883 197,615 n.a. 37 Bonds 107,256 122,984 141,891 150,419 152,267 153,812 156,207 157,888 159,972 161,347 162,835 n.a. 38 Stocks 28,061 34,262 33,763 34,498 34,859 34,688 35,905 36,732 36,180 34,536 34,780 n.a. 39 Mortgages 89,167 91,552 96,848 98,585 99,190 100,040 100,596 101,602 102,365 103,161 104,106 n.a. 40 Real estate 9,621 10,476 11,060 11,269 11,537 11,540 11,562 11,538 11,583 11,693 11,707 n.a. 41 Policy loans 24,467 25,834 27,556 28,246 28,431 28,649 28,843 29,067 29,290 29,521 29,818 n.a. 42 Other assets 16,971 18,502 21,051 20,922 21,165 21,749 21,855 21,734 22,022 22,431 22,605 n.a. Credit unions 43 Total assets/liabilities and capital 38,037 45,225 54,084 56,827 58,018 59,381 59,152 60,141 61,277 60,909 61,465 62,595 44 Federal 20,209 24,396 29,574 31,255 31,925 32,793 32,679 33,315 34,058 33,718 34,093 34,681 45 State 17,828 20,829 24,510 25,572 26,093 26,588 26,473 26,826 27,219 27,191 27,372 27,914 46 Loans outstanding 28,169 34,384 42,055 44,133 45,506 47,118 47,620 49,103 50,121 50,549 51,264 51,807 47 Federal 14,869 18,311 22,717 23,919 24,732 25,762 25,970 26,840 27,510 27,697 28,176 28,583 48 State 13,300 16,073 19,338 20,214 20,11A 21,356 21,650 22,263 22,611 22,852 23,088 23,224 49 Savings 33,013 39,173 46,832 49,931 50,789 52,076 51,551 51,772 52,867 52,468 52,600 53,048 50 Federal (shares) 17,530 21,130 25,849 27,592 28,128 28,903 28,627 28,779 29,429 29,086 29,163 29,326 51 State (shares and deposits). 15,483 18,043 20,983 22,339 22,661 23,173 22,924 22,993 23,438 23,382 23,437 23,722 For notes see bottom of page A30. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 Domestic Nonfinancial Statistics • February 1979 1.39 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Calendar year Transition quarter Fiscal Fiscal Type of account or operation (July- year year 1977 1978 1978 Sept. 1977 1978 1976) H2 HI H2 Oct. Nov. Dec. U.S. budget 1 Receipts i 81,772 357,762 401,997 175,820 210,650 206,275 28,745 33,227 37,477 2 Outlays1 94,742 402,803 450,758 216,781 222,518 238,150 42,691 39,134 41,392 3 Surplus, or deficit ( —) -12,970 -45,041 -48,761 -40,961 -11,870 -31,875 -13,946 -5,907 -3,915 4 Trust funds -1,952 7,833 12,693 4,293 4,334 11,755 1,626 1,293 1,833 5 Federal funds 2 -11,018 -52,874 -61,454 -45,254 -16,204 -43,630 -15,572 -7,200 -5,748 Off-budget entities surplus, or deficit (-) 6 Federal Financing Bank outlays... -2,575 -8,415 -10,660 -6,663 -5,105 -5,082 -975 -296 -1,178 7 Other 3 793 -269 354 428 -790 1,841 171 1,700 453 U.S. budget plus off-budget, including Federal Financing Bank 8 Surplus, or deficit (—) -14,752 -53,725 -59,067 -47,196 -17,765 -35,117 -14,750 -4,503 -4 M0 Financed by: 9 Borrowing from the public 18,027 53,516 59,106 40,284 23,374 30,308 6,484 5,236 3,533 10 Cash and monetary assets (decrease, or increase ( —)) -2,899 -2,238 -3,023 4,317 -5,098 3,381 7,082 3,485 -2,323 11 Other 4 -373 2,440 2,984 2,597 -511 1,428 1,184 -4,218 3,430 MEMO ITEMS : 12 Treasury operating balance (level, end of period) 17,418 19,104 22,444 12,274 17,526 16,291 15,545 16,291 16,291 13 Federal Reserve Banks 13,299 15,740 16,647 7,114 11,614 4,196 15,467 4,196 4,196 14 Tax and loan accounts 4,119 3,364 5,797 5,160 5,912 12,095 78 12,095 12,095 1 Effective June 1978, earned income credit payments in excess of 4 Includes public debt accrued interest payable to the public; deposit an individual's tax liability, formerly treated as income tax refunds, are funds; miscellaneous liability (including checks outstanding) and asset classified as outlays retroactive to January 1976. accounts; seignorage; increment on gold; net gain/loss for U.S. currency 2 Half years calculated as a residual of total surplus/deficit and trust valuation adjustment; net gain/loss for IMF valuation adjustment. fund surplus/deficit. 3 Includes Pension Benefit Guaranty Corp.; Postal Service Fund; Rural SOURCE. "Monthly Treasury Statement of Receipts and Outlays of Electrification and Telephone Revolving Fund, Rural Telephone Bank; the U.S. Government," Treasury Bulletin, and U.S. Budget, Fiscal Year and Housing for the Elderly or Handicapped Fund until October 1977. 1978. NOTES TO TABLE 1.38 1 Holdings of stock of the Federal Home Loan Banks are included in NOTE. Savings and loan associations: Estimates by the FHLBB for "other assets." all associations in the United States. Data are based on monthly reports 2 Includes net undistributed income, which is accrued by most, but not of federally insured associations and annual reports of other associations. all, associations. Even when revised, data for current and preceding year are subject to 3 Excludes figures for loans in process, which are shown as a liability. further revision. 4 Includes securities of foreign governments and international organiza- Mutual savings banks: Estimates of National Association of Mutual tions and nonguaranteed issues of U.S. government agencies. Savings Banks for all savings banks in the United States. Data are re- 5 Excludes checking, club, and school accounts. ported on a gross-of-valuation-reserves basis. 6 Commitments outstanding (including loans in process) of banks in Life insurance companies: Estimates of the American Council of Life New York State as reported to the Savings Banks Association of the Insurance for all life insurance companies in the United States. Annual State of New York. figures are annual-statement asset values, with bonds carried on an 7 Direct and guaranteed obligations. Excludes federal agency issues amortized basis and stocks at year-end market value. Adjustments for not guaranteed, which are shown in this table under "business" securities. interest due and accrued and for differences between market and book 8 Issues of foreign governments and their subdivisions and bonds of the values are not made on each item separately but are included, in total, in International Bank for Reconstruction and Development. "other assets." 9 Data reflect benchmark revisions back to 1977. Credit unions: Estimates by the National Credit Union Administration Data for June, July, and August 1978 have been revised. for a group of federal and state-chartered credit unions that account for n Data for 1977 and the first 6 months of 1978 have been revised by about 30 percent of credit union assets. Figures are preliminary and the American Council of Life Insurance. revised annually to incorporate recent benchmark data. 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 quarter Fiscal Fiscal Source or type (July- year year 1977 1978 1978 Sept. 1977 1978 1976) H2 HI H2 Oct. Nov. Dec. Receipts 1 All sources1 81,772 357,762 401,997 175,820 210,650 206,275 28,745 33,227 37,477 2 Individual income taxes, net 38,800 157,626 180,988 82,911 90,336 98,854 15,922 16,609 16,066 3 Withheld 32,949 144,820 165,215 75,480 82,784 90,148 15,032 16,268 15,454 4 Presidential Election Campaign Fund 11 3377 39 1 36 3 5 Nonwithheld 66,,880099 4422,,006622 47,804 9,397 37,584 10,777 1,104 533 830 6 Refunds1 995588 2299,,229933 32,070 1,967 30,068 2,075 214 192 219 7 Corporation income taxes: 8 Gross receipts 9,808 60,057 65,380 25,121 38,496 28,536 2,436 1,541 10,769 9 Refunds 1,348 5,164 5,428 2,819 2,782 2,757 752 493 382 10 Social insurance taxes and contributions, net 25,760 108,683 123,410 52,347 66,191 61,064 7,805 11,923 7,716 11 Payroll employment taxes and contributions 2 21,534 88,196 99,626 44,384 51,668 51,052 6,595 9,762 7,059 12 Self-employment taxes and contributions 3 226699 44,,001144 44,,226677 316 3,892 369 13 Unemployment insurance 22,,669988 1111,,331122 1133,,885500 4,936 7,800 6,727 722 1,662 174 14 Other net receipts 4 11,,225599 55,,116622 55,,666688 2,711 2,831 2,917 488 499 483 15 Excise taxes 4,473 17,548 18,376 9,284 8,835 9,879 1,635 1,712 1,597 16 Customs deposits 1,212 5,150 6,573 2,848 3,320 3,748 621 646 594 17 Estate and gift taxes 1,455 7,327 5,285 2,837 2,587 2,691 477 460 386 18 Miscellaneous receipts 5 1,612 6,536 7,413 3,292 3,667 4,260 602 829 732 Outlays 8 19 All types1 94,742 402,803 450,758 216,781 222,518 238,150 42,691 39,134 41,392 20 National defense 22,307 97,501 105,192 50,873 52,979 55,129 9,197 9,239 9,450 21 International affairs 2,180 4,831 6,083 2,896 2,904 2,221 324 -47 339 22 General science, space, and technology 1,161 4,677 4,721 22,,331188 2,395 2,362 367 412 407 23 Energy 794 4,172 6,045 2,487 4,461 821 792 747 24 Natural resources and environment. 2,532 10,000 11,022 4,959 6,119 878 889 1,125 25 Agriculture 584 5,526 7,618 5,477 2,353 4,854 949 1,372 1,681 26 Commerce and housing credit 1,391 -31 3,340 -946 3,291 2.124 41 309 27 Transportation 3,306 14,636 15,461 7,723 8,758 1,695 1,414 1,374 28 Community and regional development 1,340 6,283 11,255 4,924 5,928 6,108 929 910 753 29 Education, training, employment, and social services 5,162 20,985 25,889 10,800 12,792 13,676 2,144 2,244 2,210 30 Health 8,720 38,785 44,529 19,422 21,391 23,942 4,037 3,957 4,717 31 Income security1 32,795 137,905 145,640 71,081 75,201 73,305 11,815 12,358 12,469 32 Veterans benefits and services 3,962 18,038 18,987 9,864 9,603 9,545 1,6 47 1,667 2,650 33 Administration of justice 859 3,600 3,786 1,723 1,946 1,973 328 392 309 34 General government 878 3,357 3,544 1,749 1,803 2,111 785 196 269 35 General-purpose fiscal assistance— 2,092 9,499 9,377 4,926 4,665 4,385 2,019 160 79 36 Interest 6 7,246 38,092 44,040 19,962 22,280 24,110 3,030 3,850 7,372 37 Undistributed offsetting receipts 6-7 -2,567 -15,053 -15,772 -8,506 -7,945 -8,200 -397 -713 -4,870 1 Effective June 1978, earned income credit payments in excess of an 7 Consists of interest received by trust funds, rents and royalties on individual's tax liability, formerly treated as income tax refunds, are the Outer Continental Shelf, and U.S. government contributions for classified as outlays retroactive to January 1976. employee retirement. 2 Old-age, disability and hospital insurance, and railroad retirement 8 For some types of outlays the categories are new or represent reaccounts. groupings; data for these categories are from the Budget of the United 3 Old-age, disability, and hospital insurance. States Government, Fiscal Year 1979; data are not available for half-years 4 Supplementary medical insurance premiums, federal employee re- or for months prior to February 1978. tirement contributions, and Civil Service retirement and disability fund. Two categories have been renamed: "Law enforcement and justice" 5 Deposits of earnings by Federal Reserve Banks and other miscel- has become "Administration of justice" and "Revenue sharing and laneous receipts. general purpose fiscal assistance" has become "General purpose fiscal 6 Effective September 1976, "Interest" and "Undistributed Offsetting assistance." Receipts" reflect the accounting conversion for the interest on special In addition, for some categories the table includes revisions in figures issues for U.S. government accounts from an accrual basis to a cash basis. published earlier. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 Domestic NonfinancialS tatistics • February 1979 1.41 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars 1976 1977 1978 IItteemm June 30 Sept. 30 Dec. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 1 Federal debt outstanding 631.9 2 646.4 665.5 685.2 709.1 729.2 747.8 758.8 780.4 2 Public debt securities 620.4 634.7 653.5 674.4 698.8 718.9 738.0 749.0 771.5 3 Held by public 470.8 488.6 506.4 523.2 543.4 564.1 585.2 587.9 603.6 4 Held by agencies 149.6 146.1 147.1 151.2 155.5 154.8 152.7 161.1 168.0 11.5 11.6 12.0 10.8 10.3 10.2 9.9 9.8 8.9 6 Held by public 9.5 29.7 10.0 9.0 8.5 8.4 88..11 8.0 7.4 7 Held by agencies 2.0 1.9 1.9 1.8 1.8 1.8 11..88 1.8 1.5 8 Debt subject to statutory limit 621.6 635.8 654.7 675.6 700.0 720.1 739.1 750.2 772.7 619.8 634.1 652.9 673.8 698.2 718.3 737.3 748.4 770.9 10 Other debt1 1.7 1.7 1.7 1.7 1.7 1.7 1.8 1.8 1.8 11 MEMO: Statutory debt limit 636.0 636.0 682.0 700.0 700.0 752.0 752.0 752.0 798.0 1 Includes guaranteed debt of government agencies, specified participa- $0.5 billion due to a retroactive reclassification of the Export-Import Bank tion certificates, notes to international lending organizations, and District certificates of beneficial interest from loan asset sales to debt, effective of 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 Department). 1.42 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1978 1979 TTyyppee aanndd hhoollddeerr 11997744 11997755 11997766 11997777 Sept. Oct. Nov. Dec. Jan. 1 Total gross public debt 492.7 576.6 653.5 718.9 771.5 776.4 783.0 789.2 790.5 By type: 2 Interest-bearing debt 491.6 575.7 652.5 715.2 767.0 775.5 782.0 782.4 789.5 3 Marketable 282.9 363.2 421.3 459.9 485.2 491.7 493.3 487.5 496.5 4 Bills 119.7 157.5 164.0 161.1 160.9 161.2 161.5 161.7 162.3 5 Notes 129.8 167.1 216.7 251.8 267.9 272.6 271.7 265.8 272.8 6 33.4 38.6 40.6 47.0 56.4 57.8 60.1 60.0 61.4 7 Nonmarketable1 208.7 212.5 231.2 255.3 281.8 283.8 288.7 294.8 293.0 8 Convertible bonds2 2.3 2.3 2.3 2.2 2.2 2.2 2.2 2.2 2.2 9 State and local government series .6 1.2 4.5 13.9 24.2 24.1 24.1 24.3 24.2 10 Foreign issues 3 22.8 21.6 22.3 22.2 21.7 24.0 26.6 28.0 27.5 11 Savings bonds and notes 63.8 67.9 72.3 77.0 80.2 80.5 80.7 80.9 80.8 12 Government account series4 119.1 119.4 129.7 139.8 153.3 152.7 154.8 157.5 155.2 13 Non-interest-bearing debt 1.1 1.0 1.1 3.7 4.6 .9 1.0 6.8 1.0 By holder:5 14 U.S. government agencies and trust funds... 138.2 139.1 147.1 154.8 168.0 166.3 167.4 15 80.5 89.8 97.0 102.5 114.8 115.3 113.3 16 271.0 349.4 409.5 461.3 488.3 494.7 502.3 17 Commercial banks 55.6 85.1 103.8 101.4 95.3 94.3 93.5 18 Mutual savings banks 2.5 4.5 5.9 5.9 5.4 5.4 5.3 19 Insurance companies 6.2 9.5 12.7 15.1 15.1 15.3 15.1 20 Other corporations 11.0 20.2 27.7 22.7 21.5 21.0 20.9 n.a. n. a. 21 State and local governments 29.2 34.2 41.6 55.2 67.8 67.1 69.1 Individuals: 22 63.4 67.3 72.0 76.7 79.8 80.2 80.5 23 Other securities 21.5 24.0 28.8 28.6 29.4 29.6 29.8 24 Foreign and international6 58.8 66.5 78.1 109.6 121.0 122.5 132.4 25 Other miscellaneous investors7 22.8 38.0 38.9 46.1 52.9 54.3 55.8 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 International 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 IVi porate pension trust funds, dealers and brokers, certain government percent, 5-year marketable Treasury notes. Convertible bonds that have deposit accounts, and government 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 almost entirely by U.S. government agencies and trust funds. the United States (U.S. Treasury Department); data by holder from 5 Data for Federal Reserve Banks and U.S. government agencies and Treasury Bulletin. trust funds are 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 TTyyppee ooff hhoollddeerr 11997766 1977 1976 1977 Oct. Nov. Oct. Nov. All maturities 1 to 5 years 1 All holders 421,276 459,927 491,651 493,337 141,132 151,264 171,802 168,795 16,485 14,420 13,885 12,776 6,141 4,788 3,705 3,310 3 Federal Reserve Banks 96,971 101,191 115,322 113,305 31,249 27,012 32,033 31,608 307,820 344,315 362,443 367,256 103,742 119,464 136,064 133,876 78,262 75,363 69,906 69,332 40,005 38,691 40,841 40,042 4,072 4,379 3,744 3,642 2,010 2,112 2,080 1,997 10,284 12,378 11,994 11,732 3,885 4,729 4,981 4,806 14,193 9,474 8,791 8,731 2,618 3,183 4,522 3,523 9 Savings and loan associations 4,576 4,817 4,312 4,173 2,360 2,368 2,546 2,464 12,252 15,495 17,594 19,146 2,543 3,875 4,316 4,281 184,182 222,409 246,102 250,500 50,321 64,505 16,111 76,763 Total, within 1 year 5 to 10 years 12 All holders 211,035 230,691 227,101 228,284 43,045 45,328 49,271 50,402 13 U.S. government agencies and trust funds 2,012 1,906 2,281 1,488 2,879 2,129 1,987 1,989 51,569 56,702 59,483 56,304 9,148 10,404 13,807 14,717 J57,454 172,084 165,337 170,492 31,018 32,795 33,476 33,695 31,213 29,477 19,116 19,342 6,278 6,162 7,354 7,408 1,214 1,400 845 863 567 584 543 507 2,191 2,398 1,788 1,799 2,546 3,204 2,970 2,894 11,009 5,770 3,725 4,686 370 307 361 292 20 Savings and loan associations 1,984 2,236 1,563 1,540 155 143 131 90 6,622 7,917 7,202 8,366 1,465 1,283 1,595 1,557 22 All others 103,220 122,885 131,097 133,895 19,637 21,112 20,521 20,946 Bills, within 1 year 10 to 20 years 23 All holders 163,992 161,081 161,227 161,548 11,865 12,906 18,052 19,912 24 U.S. government agencies and trust funds 449 32 2 2 3,102 3,102 3,273 3,957 25 Federal Reserve Banks 41,279 42,004 48,450 45,985 1,363 1,510 2,033 2,077 122,264 119,035 112,775 115,561 7,400 8,295 12,746 13,879 27 Commercial banks 17,303 11,996 4,545 4,431 339 456 1,212 1,067 454 484 195 161 139 137 151 143 1,463 1,187 818 766 1,114 1,245 1,354 1,463 30 Nonfinancial corporations 9,939 4,329 1,358 2,083 142 133 132 70 31 Savings and loan associations 1,266 806 290 278 64 54 55 60 5,556 6,092 4,774 5,876 718 890 1,133 1,365 33 All others 86,282 94,152 100,796 101,966 4,884 5,380 8,702 9,710 Other, within 1 year Over 20 years 34 All holders 47,043 69,610 65,874 66,736 14,200 19,738 25,425 25,944 35 U.S. government agencies and trust funds 1,563 1,874 2,279 1,487 2,350 2,495 2,639 2,032 36 Federal Reserve Banks 10,290 14,698 11,033 10,319 3,642 5,564 7,966 8,599 35,190 53,039 52,561 54,931 8,208 11,679 14,820 15,314 38 Commercial banks 13,910 15,482 14,571 14,911 427 578 1,383 1,473 39 Mutual savings banks 760 916 650 702 143 146 118 131 40 Insurance companies 728 1,211 970 1,033 548 802 900 770 1,070 1,441 2,368 2,603 55 81 51 159 42 Savings and loan associations 718 1,430 1,273 1,262 13 16 17 17 43 State and local governments 1,066 r\,825 2,428 2,490 904 1,530 3,347 3,577 44 All others 16,938 28,733 30,301 31,929 6,120 8,526 9,003 9,186 NOTE. Direct public issues only. Based on Treasury Survey of Owner- (1) 5,464 commercial banks 464 mutual savings banks, and 727 insurance ship from Treasury Bulletin (U.S. Treasury Department). companies, each about 80 percent; (2) 435 nonfinancial corporations and Data complete for U.S. government agencies and trust funds and 485 savings and loan associations, each about 50 percent; and (3) 493 Federal Reserve Banks, but data for other groups include only holdings state and local governments, about 40 percent. of those institutions that report. The following figures show, for each "All others," a residual, includes holdings of all those not reporting category, the number and proportion reporting as of Nov. 31, 1978: 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 Nonfinancial Statistics • February 1979 1.44 U.S. GOVERNMENT SECURITIES DEALERS Transactions Par value; averages of daily figures, in millions of dollars 1978 1978, week ending Wednesday— IItteemm 11997755 11997766 11997777 Oct. Nov. Dec. Nov. 8 Nov. 15 Nov. 22 Nov. 29 Dec. 6 Dec. 13 1 U.S. government securities. . 6,027 10,449 10,838 9,817 11,844 8,837 12,871 13,354 10,326 9,824 8,079 9,083 By maturity: 2 Bills 3,889 6,676 6,746 6,289 6,573 5,336 6,075 7,661 6,155 5,972 4,977 5,723 3 Other within 1 year 223 210 237 420 449 400 333 577 487 392 285 459 4 1-5 years 1,414 2,317 2,320 1,520 2,301 1,676 2,508 2,081 1,933 1,973 1,347 1,157 5 5-10 years 363 1,019 1,148 691 1,207 738 1,709 1,518 877 816 705 888 6 Over 10 years 138 229 388 897 1,314 687 2,246 1,517 875 670 766 856 By type of customer: 7 U.S. government securities dealers 885 1,360 1,267 983 908 954 949 11,,004455 937 664 666 923 8 U.S. government securities brokers 1,750 3,407 3,709 4,052 5,321 3,303 5,927 5,754 4,850 4,124 3,547 3,648 9 Commercial banks 1,451 2,426 2,295 1,404 1,834 1,514 1,920 2,115 1,502 1,630 1,255 1,437 10 All others i 1,941 3,257 3,568 3,377 3,780 3,066 4,075 4,440 3,038 3,406 2,612 3,075 11 Federal agency securities 1,043 1,548 1,729 2,029 2,208 2,325 2,123 2,514 2,060 1,979 2,300 2,313 1 Includes, among others, all other dealers and brokers in commodities Transactions are market purchases and sales of U.S. government and securities, foreign banking agencies, and the Federal Reserve System. securities dealers reporting to the Federal Reserve Bank of New York. The figures exclude allotments of, and exchanges for, new U.S. government NOTE. Averages for transactions are based on number of trading days securities, redemptions of called or matured securities, or purchases or in the period. sales of securities under 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 1978 1978, week ending Wednesday— IItteemm 11997755 11997766 11997777 Oct. Nov. Dec. Oct. 18 Oct. 25 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Positions2 1111 UUUU....SSSS.... ggggoooovvvveeeerrrrnnnnmmmmeeeennnntttt sssseeeeccccuuuurrrriiiittttiiiieeeessss.... .... 5,884 7,592 5,172 1,424 2,417 2,134 1,232 •1,177 2,018 2,904 2,548 1,894 2222 BBBBiiiillllllllssss 4,297 6,290 4,772 1,739 1,958 1,922 1,759 rl,493 2,007 1,869 1,880 1,690 3333 OOOOtttthhhheeeerrrr wwwwiiiitttthhhhiiiinnnn 1111 yyyyeeeeaaaarrrr 265 188 99 462 60 97 518 540 364 389 181 -110 4444 1111----5555 yyyyeeeeaaaarrrrssss 886 515 60 -593 -228 -73 -888 -660 94 -35 -491 -326 5555 5555----11110000 yyyyeeeeaaaarrrrssss 300 402 92 -207 413 211 -195 -247 -279 536 673 393 6666 OOOOvvvveeeerrrr 11110000 yyyyeeeeaaaarrrrssss 136 198 149 23 213 -24 38 r52 -167 144 305 247 7777 FFFFeeeeddddeeeerrrraaaallll aaaaggggeeeennnnccccyyyy sssseeeeccccuuuurrrriiiittttiiiieeeessss................ 939 729 693 234 217 370 204 r69 97 169 139 325 Sources of financing3 8888 AAAAllllllll ssssoooouuuurrrrcccceeeessss 6,666 8,715 9,877 10,430 11,396 11,918 10,426 10,275 11,071 11,811 10,881 11,355 CCCCoooommmmmmmmeeeerrrrcccciiiiaaaallll bbbbaaaannnnkkkkssss:::: 9999 NNNNeeeewwww YYYYoooorrrrkkkk CCCCiiiittttyyyy 1,621 1,896 1,313 385 347 638 234 460 139 825 348 304 11110000 OOOOuuuuttttssssiiiiddddeeee NNNNeeeewwww YYYYoooorrrrkkkk CCCCiiiittttyyyy............ 1,466 1,660 1,987 2,105 2,032 2,210 2,278 1,811 2,244 1,896 1,930 2,134 11111111 CCCCoooorrrrppppoooorrrraaaattttiiiioooonnnnssss1111 842 1,479 2,423 2,396 3,007 2,890 2,530 2,632 2,503 2,890 3,051 3,000 11112222 AAAAllllllll ooootttthhhheeeerrrrssss 2,738 3,681 4,155 5,543 6,010 6,179 5,384 5,371 6,184 6,201 5,553 5,916 1 All business corporations except commercial banks and insurance firms and dealer departments of commercial banks against U.S. governcompanies. ment and federal agency securities (through both collateral loans and sales 2 New 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 securities held under agreement to resell are excluded where the borrowing been sold under agreements to repurchase. The maturities of some re- contract and the agreement to resell are equal in amount and maturity, purchase agreements are sufficiently long, however, to suggest that the that is, a matched agreement. securities involved are not available for trading purposes. Securities owned, and hence dealer positions, do not include securities purchased NOTE. Averages for positions are based on number of trading days under agreements 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 1978 Agency 1975 1976 1977 June July Aug. Sept. Oct. Nov. 1 Federal and federally sponsored agencies 97,680 103,325 109,924 120,387 122,638 123,297 125,397 127,468 129,139 19,046 21,896 r22,760 r23,131 '23,286 r22,505 '23,139 '23,279 23,073 3 Defense Department1 1,220 1,113 983 926 916 906 897 897 876 4 Export-Import Bank2-3 7,188 7,801 '8,671 '8,603 r8.596 '8,274 '8,709 '8,704 8,392 5 Federal Housing Administration4 564 575 581 606 603 603 601 598 594 6 Government National Mortgage Association participation certificates5 4,200 4,120 3,743 3,701 3,666 3,166 3,166 3,166 3,166 7 Postal Service6 1,750 2,998 2,431 2,364 2,364 2,364 2,364 2,364 2,364 8 Tennessee Valley Authority 3,915 5,185 6,015 6,575 6,785 6,835 7,045 7,195 7,325 9 United States Railway Association6 209 104 336 356 356 357 357 355 356 10 Federally sponsored agencies 78,634 81,429 87,164 97,256 99,352 100,792 102,258 104,189 106,066 11 Federal Home Loan Banks 18,900 16,811 18,345 22,306 23,430 24,360 25,025 25,395 26,777 12 Federal Home Loan Mortgage Corporation.. 1,550 1,690 1,686 1,937 1,937 1,937 2,063 2,063 2,062 13 Federal National Mortgage Association 29,963 30,565 31,890 36,404 36,900 37,518 38,353 39,776 39,814 15,000 17,127 19,118 19,686 20,198 20,198 20,198 20,360 20,360 15 Federal Intermediate Credit Banks 9,254 10,494 11,174 11,257 11,392 11,482 11,555 11,554 11,548 16 Banks for Cooperatives 3,655 4,330 4,434 4,974 4,788 4,570 4,317 4,264 4,668 17 Student Loan Marketing Association7 310 410 515 690 705 725 745 775 835 18 Other 2 2 2 2 2 2 2 2 2 MEMO ITEMS : 19 Federal Financing Bank debt6*8 17,154 2288,,771111 38,580 4444,,550044 45,550 46,668 4488,,007788 49,212 49,645 Lending to federal and federally sponsored agencies: 20 Export-Import Bank3 4,595 5,208 55,,883344 6,132 6,132 6,132 6,568 6,568 6,568 21 Postal Service6 1,500 2,748 2,181 2,114 2,114 2,114 2,114 2,114 2,114 22 Student Loan Marketing Association7 310 410 515 690 705 725 745 775 835 23 Tennessee Valley Authority 1,840 3,110 4,190 4,750 4,960 5,010 5,220 5,370 5,500 24 United States Railway Association6 209 104 336 356 356 357 357 355 356 Other lending:9 25 Farmers Home Administration 7,000 10,750 1166,,009955 20,910 21,580 22,275 22,275 23,050 23,050 26 Rural Electrification Administration 566 1,415 2,647 3,602 3,684 3,919 4,192 4,407 4,489 27 Other 1,134 4,966 6,782 5,950 6,019 6,136 6,607 6,573 6,733 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 8 The FFB, which began operations in 1974, is authorized to purchase thereafter. or sell obligations issued, sold, or guaranteed by other federal agencies. 4 Consists of debentures issued in payment of Federal Housing Ad- Since FFB incurs debt solely for the purpose of lending to other agencies, ministration insurance claims. Once issued, these securities may be sold its debt is not included in the main portion of the table in order to avoid privately on the securities market. double counting. 5 Certificates of participation issued prior to fiscal 1969 by the Govern- 9 Includes FFB purchases of agency assets and guaranteed loans; ment National Mortgage Association acting as trustee for the Farmers the latter contain loans guaranteed by numerous agencies with the Home Administration; Department of Health, Education, and Welfare; guarantees of any particular agency being generally small. The Farmers Department of Housing and Urban Development; Small Business Ad- Home Administration item consists exclusively of agency assets, while the ministration; and the Veterans Administration. Rural Electrification Administration entry contains both agency assets 6 Off-budget. and guaranteed loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 Domestic NonfinancialS tatistics • February 1979 1.47 NEW SECURITY ISSUES of State and Local Governments Millions of dollars 1978 Type of issue or issuer, 1976 1977 1978 or use July Aug.r Sept.r Oct.r Nov.r Dec. 1 35,313 46,769 48,607 3,923 6,416 2,330 3,244 4,328 3,694 By type of issue: 2 General obligation 18,040 18,042 17,854 1,065 2,161 703 1,148 1,168 1,698 3 1177,,114400 28,655 30,658 2,855 4,246 1,620 2,083 3,152 1,992 4 Housing Assistance Administration 2 5 133 72 95 3 9 7 13 8 4 By type of issuer: 6 7,054 6,354 6.632 650 919 85 552 343 497 7 Special district and statutory authority 15,304 21,717 24,156 2,171 3,120 1,599 1,616 2,848 2,148 8 Municipalities, counties, townships, school districts.... 12,845 18,623 17,718 1,098 2,369 639 1,061 1,129 1,043 32,108 36,189 37,629 3,497 3,365 2,266 3,160 4,216 3,379 By use of proceeds: 10 4,900 5,076 5,003 499 277 397 314 463 319 11 2,586 2,951 3,460 292 632 302 422 259 337 12 9,594 8,119 9,026 941 689 695 831 1,241 705 13 6,566 8,274 10,494 1,241 967 526 1,169 817 1,126 14 483 4,676 3,526 244 344 105 249 323 276 15 Other purposes 7,979 7,093 6,120 280 456 241 175 1,113 616 1 Par amounts of long-term issues based on date of sale. SOURCE. Public Securities Association. 2 Only bonds sold pursuant to the 1949 Housing Act, which are secured by contract requiring the Housing Assistance Administration to make annual contributions to the local authority. 1.48 NEW SECURITY ISSUES of Corporations Millions of dollars 1978 Type of issue or issuer, 1975 1976 1977 or use April May June July Aug. Sept. 1 All issues 1 53,619 53,488 54,205 3,285 4,035 5,215 4,226 3,311 3,832 2 Bonds 42,756 42,380 42,193 2,811 2,996 3,810 3,718 2,529 2,905 By type of offering: 3 Public 32,583 26,453 24,186 1,958 1,719 1,744 2,177 1,497 1,610 4 Private placement 10,172 15,927 18,007 853 1,277 2,066 1,541 1,032 1,295 By industry group: 5 Manufacturing 16,980 13,264 12,510 534 837 1,105 675 485 823 6 Commercial and miscellaneous 2,750 4,372 5,887 421 314 562 417 414 454 7 Transportation 3,439 4,387 2,033 291 244 225 235 115 135 8 Public utility 9,658 8,297 8,261 505 885 815 768 521 912 9 Communication 3,464 2,787 3,059 35 344 326 546 205 10 Real estate and financial 6,469 9,274 10,438 1,027 714 761 1,296 448 375 11 Stocks 10,863 11,108 12,013 474 1,039 1,405 508 782 927 By type: 12 Preferred 3,458 2,803 3,878 235 390 586 57 157 127 13 Common 7,405 8,305 8,135 239 649 819 451 625 800 By industry group: 14 M anufacturing 1,670 2,237 1,265 15 41 366 167 236 148 15 Commercial and miscellaneous 1,470 1,183 1,838 183 90 245 167 110 168 16 Transportation 24 418 28 20 38 40 12 17 Public utility 6,235 6,121 6,058 238 800 429 31 354 426 18 Communication 1,002 776 1,379 5 27 6 10 19 Real estate and financial 488 771 1,054 10 320 76 75 164 1 Figures, which represent gross proceeds of issues maturing in more companies other than closed-end, intracorporate transactions, and sales to than 1 year, sold for cash in the United States, are principal amount or foreigners. number of units multiplied by offering price. Excludes offerings of less than $100,000, secondary offerings, undefined or exempted issues as SOURCE. Securities and Exchange Commission. defined in the Securities Act of 1933, employee stock plans, investment Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Corporate Finance A37 1.49 OPEN-END INVESTMENT COMPANIES Net Sales and Asset Position Millions of dollars 1978 IItteemm 11997777 11997788 June July Aug. Sept. Oct. Nov.r Dec. INVESTMENT COMPANIES excluding money market funds 1 Sales of own shares1 6,401 6,645 487 474 638 519 463 587 602 2 Redemptions of own shares2 6,027 7,231 757 645 882 673 607 439 545 3 Net sales 357 -586 -270 -181 -244 -154 -144 148 57 4 Assets3 45,049 45,184 46,106 47,975 49,299 48,151 43,462 44,242 45,184 5 Cash position4 3,274 4,522 4,493 4,285 3,948 3,703 3,793 4,299 4,522 6 Other 41,775 40,662 41,613 43,690 45,351 44,448 39,669 39,943 40,662 1 Includes reinvestment of investment income dividends. Excludes 4 Also includes all U.S. government securities and other short-term reinvestment of capital gains distributions and share issue of conversions debt securities. from one fund to another in the same group. 2 Excludes share redemption resulting from conversions from one fund NOTE. Investment Company Institute data based on reports of memto another in the same group. bers, which comprise substantially all open-end investment companies 3 Market value at end of period, less current liabilities. registered with the Securities and Exchange Commission. Data reflect newly formed companies after their initial offering of securities. 1.50 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1977 1978 AAccccoouunntt 1975 1976 1977 Ql Q2 Q3 Q4 Ql Q2 Q3 1 Profits before tax 120.4 155.9 173.9 164.8 175.1 177.5 178.3 172.1 205.5 205.4 2 Profits tax liability 49.8 64.3 71.8 68.3 72.3 72.8 73.9 70.0 85.0 86.2 3 Profits after tax 70.6 91.6 102.1 96.5 102.8 104.7 104.4 102.1 120.5 119.2 4 Dividends 31.9 37.9 43.7 41.5 42.7 44.1 46.3 47.0 48.1 50.1 5 Undistributed profits 38.7 53.7 58.4 55.0 60.1 60.6 58.1 55.1 72.4 69.1 6 Capital consumption allowances 89.2 97.1 106.0 102.0 105.0 107.6 109.3 111.3 113.3 115.4 7 Net cash flow 127.9 150.8 164.4 157.0 165.1 168.2 167.4 166.4 185.7 184.5 SOURCE. Survey of Current Business (U.S. Department of Commerce.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A38 Domestic Nonfinancial Statistics • February 1979 1.51 NONFINANCIAL CORPORATIONS Current Assets and Liabilities Billions of dollars, except for ratio 1976 1977 1978 AAccccoouunntt 11997744 11997755 Q4 Ql Q2 Q3 Q4 Ql Q2 Q3 1 Current assets 734.6 756.3 823.1 842.0 856.4 880.3 900.1 924.2 953.5 992.4 2 Cash 73.0 80.0 86.8 80.8 83.1 83.4 94.2 88.5 90.9 91.4 3 U.S. government securities 11.3 19.6 26.0 26.8 22.1 21.5 20.9 20.9 19.7 18.6 4 Notes and accounts receivable 265.5 272.1 292.4 304.1 312.8 326.9 325.7 338.3 356.8 377.8 5 Inventories 318.9 314.7 341.4 352.1 358.8 367.5 375.0 389.7 399.1 415.5 6 Other 65.9 69.9 76.4 78.3 79.6 81.0 84.3 86.8 87.0 89.0 7 Current liabilities 451.8 446.9 487.5 502.6 509.5 528.9 543.2 570.4 590.8 624.5 8 Notes and accounts payable 272.3 261.2 273.2 280.2 286.8 297.8 306.8 317.2 331.3 349.9 9 Other 179.5 185.7 214.2 222.4 222.7 231.1 236.3 253.2 259.4 274.6 10 Net working capital 282.8 309.5 335.6 339.5 346.9 351.4 357.0 353.8 362.7 367.9 j 1.626 1.693 1.688 1.675 1.681 1.664 1.657 1.620 1.614 1.589 1 Ratio of total current assets to total current liabilities. SOURCE. Federal Trade Commission. NOTE. For a description of this series see "Working Capital of Nonfinancial Corporations" in the July 1978 BULLETIN, pp. 533-37. 1.52 BUSINESS EXPENDITURES on New Plant and Equipment Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1977 1978 IInndduussttrryy 11997777 1199778822 Ql Q2 Q3 Q4 Ql Q2 Q3 Q4 1 All industries 135.72 152.28 130.16 134.24 140.38 138.11 144.25 150.76 155.13 158.98 Manufacturing 2 Durable goods industries 27.75 31.53 26.30 27.26 29.23 28.19 28.72 31.40 32.11 33.89 3 Nondurable goods industries 32.33 36.23 30.13 32.19 33.79 33.22 32.86 35.80 36.54 39.72 Nonmanufacturing 4 Mining 4.49 4.78 4.24 4.49 4.74 4.50 4.45 4.81 4.80 5.07 Transportation: 5 Railroad 2.S2 328 2.71 2.57 3.20 2.80 3.35 3.09 3.64 3.05 6 Air i.63 2.45 1.62 1.43 1.69 1.76 2.67 2.08 2.97 2.08 7 Other 2.55 2.27 2.96 2.96 1.96 2.32 2.44 2.23 2.37 2.05 Public utilities: 8 Electric 21.57 24.49 21.19 21.14 21.90 22.05 23.15 23.83 25.04 25.94 9 Gas and other 4.21 4.48 4.16 4.16 4.32 4.18 4.78 4.62 4.22 4.28 11 1 11 0 C Co o m m m m e u r n c i i c a a l ti a o n n d other1 | 22 1 22 5 .. . 99 4 55 3 22 1 22 4 .. . 66 1 77 9 22 1 22 5 .. . 77 3 33 2 22 1 33 6 .. . 11 4 44 0 22 1 33 5 .. . 22 8 77 2 22 1 44 7 .. . 77 0 66 7 22 1 44 8 .. . 77 1 11 8 }}} 444333...444444 444222...999000 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 1977 1978 AAccccoouunntt 11997722 11997733 11997744 11997755 11997766 Q3 Q4 QL Q2 Q3 ASSETS Accounts receivable, gross 1 Consumer 31.9 35.4 36.1 36.0 38.6 42.3 44.0 44.5 47.1 49.7 2 Business 27.4 32.3 37.2 39.3 44.7 50.6 55.2 57.6 59.5 58.3 3 Total 59.3 67.7 73.3 75.3 83.4 92.9 99.2 102.1 106.6 108.0 4 LESS: Reserves for unearned income and losses 7.4 8.4 9.0 9.4 10.5 11.7 12.7 12.8 14.1 14.3 5 Accounts receivable, net 51.9 59.3 64.2 65.9 72.9 81.2 86.5 89.3 92.6 93.7 6 Cash and bank deposits 2.8 2.6 3.0 2.9 2.6 2.5 2.6 2.2 2.9 2.7 7 Securities .9 .8 .4 1.0 1.1 1.8 .9 1.2 1.3 1.8 8 All other 10.0 10.6 12.0 11.8 12.6 14.2 14.3 15.0 16.2 17.1 9 Total assets 65.6 73.2 79.6 81.6 89.2 99.6 104.3 107.7 112.9 115.3 LIABILITIES 10 Bank loans 5.6 7.2 9.7 8.0 6.3 5.4 5.9 5.8 5.4 5.4 11 Commercial paper 17.3 19.7 20.7 22.2 23.7 25.7 29.6 29.9 31.3 29.3 Debt: 12 Short-term, n.e.c 4.3 4.6 4.9 4.5 5.4 5.4 6.2 5.3 6.6 6.8 13 Long-term, n.e.c 22.7 24.6 26.5 27.6 32.3 34.8 36.0 38.0 40.1 41.3 14 Other 4.8 5.6 5.5 6.8 8.1 13.7 11.5 12.9 13.6 15.2 15 Capital, surplus, and undivided profits 10.9 11.5 12.4 12.5 13.4 14.6 15.1 15.7 16.0 17.3 16 Total liabilities and capital 65.6 73.2 79.6 81.6 89.2 99.6 104.3 107.7 112.9 115.3 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 AAAccccccooouuunnntttsss receivable during— rrreeeccceeeiiivvvaaabbbllleee TTTyyypppeee ooouuutttssstttaaannnddd--iiinnnggg NNNooovvv... 333000,,, 1978 1978 1978 111999777888111 Sept. Oct. Nov. Sept. Oct. Nov. Sept. Oct. Nov. 1 Total 61,699 -234 704 1,210 15,530 15,078 16,293 15,764 14,374 15,083 2 Retail automotive (commercial vehicles) 14,261 209 214 229 1,202 1,237 1,260 993 1,023 1,031 3 Wholesale automotive 11,914 -506 103 591 6,119 66,,117711 66,,994466 66,,662255 66,,006688 66,,335555 4 Retail paper on business, industrial, and farm equipment 16,551 -154 160 226 1,198 1,041 1,159 1,352 881 933 5 Loans on commercial accounts receivable... 4,048 150 -202 -49 3,454 3,233 3,310 3,304 3,435 3,359 6 Factored commercial accounts receivable.... 2,629 83 291 209 1,584 1,543 1,776 1,501 1,252 1,567 7 All other business credit 12,296 -16 138 4 1,973 1,853 1,842 1,989 1,715 1,838 i Not seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A40 Domestic Nonfinancial Statistics • February 1979 1.53 MORTGAGE MARKETS Millions of dollars; exceptions noted. 1978 Item 1976 1977 1978 July Aug. Sept. Oct. Nov. Dec. Terms and yields in primary and secondary markets PRIMARY MARKETS Conventional mortgages on new homes Terms:1 1 48.4 54.3 62.6 61.9 63.6 64.6 66.8 65.1 68.1 2 Amount of loan (thous. dollars) 35.9 40.5 45.9 45.3 46.4 46.7 48.6 47.5 49.6 3 Loan/price ratio (percent) 74.2 76.3 75.3 75.3 75.3 74.1 74.4 74.4 75.1 4 Maturity (years) 27.2 27.9 28.0 28.2 28.0 27.8 28.0 27.9 28.1 5 Fees and charges (percent of loan amount)2. 1.44 1.33 1.39 1.40 1.43 1.36 1.37 1.40 1.49 6 Contract rate (percent per annum) 8.76 8.80 9.30 9.34 9.45 9.50 9.60 9.63 9.76 Yield (percent per annum): 7 FHLBB series 3 8.99 99..0011 99..5544 9.57 9.70 9.73 9.83 9.87 10.02 8 HUD series4 8.99 8.95 9.68 9.80 9.80 9.80 9.95 10.10 10.30 SECONDARY MARKETS Yields (percent per annum): 9 FHA mortgages (HUD series) 5 8.82 77..9966 8.08 9.92 9.78 9.78 9.93 9.99 10.16 10 8.17 8.04 8.98 9.16 8.95 '"9.04 '9.25 r9.39 9.54 FNMA auctions:7 11 8.99 8.73 9.77 10.01 9.81 9.78 10.03 10.30 10.50 12 9.11 8.98 10.01 10.19 10.11 10.02 10.19 10.56 10.85 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 13 Total 32,904 34,370 43,311 39,409 40,325 41,189 41,957 42,590 43,311 14 18,916 18,457 21,243 19,763 20,034 20,325 20,625 20,929 21,243 15 9,212 9,315 10,544 10,457 10,535 10,575 10,565 10,535 10,544 16 4,776 6,597 11,524 9,189 9,752 10,289 10,767 11,126 11,524 Mortgage transactions (during period) 17 3,606 r4,780 12,303 945 11,,223300 1,132 1,053 920 974 1188 Sales 8866 ''6677 5 nn..aa.. Mortgage commitments:8 19 Contracted (during period) 6,247 1,333 n.a. 927 527 882 1,900 1,275 n.a. 20 Outstanding (end of period) 3,398 4,698 n.a. 10,171 9,419 9,068 9,547 9,525 n.a. Auction of 4-month commitments to buy— Government-underwritten loans: 21 Offered 9 4,929.8 '7,974.1 12,978 756.7 499.1 717.9 1,964.8 788.0 627.0 22 Accepted 2,787.2 '4,846.2 6,747.2 471.5 277.2 335.9 832.4 321.8 319.6 Conventional loans: 23 Offered 9 2,595.7 ''55,,667755..22 9,933.0 316.0 224.7 484.7 1,156.8 861.4 417.4 24 Accepted 1,879.2 '3,917.8 5,110.9 178.9 128.5 283.7 495.6 386.8 220.9 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period)1 o 25 Total 44,,226699 33,,227766 3,064 2,024 2,448 2,486 2,867 3,022 3,064 26 FHA/VA 1,618 1,395 1,243 1,321 1,304 1,287 1,594 1,257 1,243 27 2,651 1,881 1,822 702 1,144 1,199 1,273 1,766 1,822 Mortgage transactions (during period) 28 Purchases 11,,117755 ''33,,990000 6,524 520 742 670 791 763 596 29 Sales 1,396 '4,131 6,211 725 299 594 369 581 540 Mortgage commitments:11 30 Contracted (during period) 1,477 '5,546 7,451 737 838 760 547 706 455 31 333 1,063 1,410 2,055 2,142 2,130 1,716 1,617 1,410 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 mortgages carrying the prevailing ceiling rate. Monthly figures are Loan Bank Board in cooperation with the Federal Deposit Insurance unweighted averages of Monday quotations for the month. Corporation. 7 Average gross yields (before deduction of 38 basis points for mortgage 2 Includes all fees, commissions, discounts, and "points" paid (by the servicing) on accepted bids in Federal National Mortgage Association's 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 prepay- prepayment in 12 years for 30-year mortgages. No adjustments are made ment at the end of 10 years. for FN MA commitment fees or stock related requirements. Monthly 4 Average contract rates on new commitments for conventional first figures are unweighted averages for auctions conducted within the month. mortgages, rounded to the nearest 5 basis points; from Dept. of Housing 8 Includes some multifamily and nonprofit hospital loan commitments and Urban Development. in addition to 1- to 4-family loan commitments accepted in FNMA's 5 Average gross yields on 30-year, minimum-downpayment, Federal free market auction system, and through the FNMA-GNMA tandem Housing Administration-insured first mortgages for immediate delivery plans. in the private secondary market. Any gaps in data are due to periods of 9 Mortgage amounts offered by bidders are total bids received. adjustment to changes in maximum permissible contract rates. 10 Includes participations as well as whole loans. 6 Average net yields to investors on Government National Mortgage 11 Includes conventional and government-underwritten loans. Association-guaranteed, mortgage-backed, fully-modified pass-through Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Real Estate Debt A41 1.54 MORTGAGE DEBT OUTSTANDING Millions of dollars, end of period 1977 1978 Type of holder, and type of property 1973 1974 1975 1976 Q4 Ql Q2 Q3*> 1 All holders 682,321 742,512 801,537 889,327 1,023,417 1,052,307 1,090,234 1,128,398 2 1- to 4-family 416,211 449,371 490,761 556,557 656,116 675,514 701,392 727,096 3 Multifamily 93,132 99,976 100,601 104,516 111,804 114,202 116,793 119,422 4 Commercial 131,725 146,877 159,298 171,223 189,829 194,545 201,054 208,017 5 Farm 41,253 46,288 50,877 57,031 65,668 68,046 71,004 73,863 6 Major financial institutions 505,400 542,560 581,193 647,650 745,011 764,614 792,762 819,264 7 Commercial banks1 119,068 132,105 136,186 151,326 178,979 184,423 193,223 202,423 8 1- to 4-family 67,998 74,758 77,018 86,234 105,115 108,699 113,886 119,308 9 Multifamily 6,932 7,619 5,915 8,082 9,215 9,387 9,816 10,283 10 Commercial 38,696 43,679 46,882 50,289 56,898 58,407 61,194 64,107 11 Farm 5,442 6,049 6,371 6,721 7,751 7,930 8,327 8,725 12 Mutual savings banks 73,230 74,920 77,249 81,639 88,104 89,800 91,535 93,511 13 1- to 4-family 48,811 49,213 50,025 53,089 57,637 58,747 59,882 61,175 14 Multifamily 12,343 12,923 13,792 14,177 15,304 15,398 15,900 16,243 15 Commercial 12,012 12,722 13,373 14,313 15,110 15,401 15,698 16,037 16 Farm 64 62 59 60 53 54 55 56 17 Savings and loan associations 231,733 249,301 278,590 323,130 381,163 392,479 407,964 420,947 18 1- to 4-family 187,078 200,987 223,903 260,895 310,686 319,910 332,532 343,114 19 Multifamily 22,779 23,808 25,547 28,436 32,513 33,478 34,779 35,907 20 Commercial 21,876 24,506 29,140 33,799 37,964 39,091 40,633 41,926 21 Life insurance companies 81,369 86,234 89,168 91,555 96,765 97,963 100,040 102,383 22 1- to 4-family 20,426 19,026 17,590 16,088 14,727 14,476 14,129 13,929 23 Multifamily 18,451 19,625 19,629 19,178 18,807 18,851 18,745 18,945 24 Commercial 36,496 41 ,256 45,196 48,864 54,388 55,426 57,463 59,309 25 Farm 5,996 6,327 6,753 7,425 8,843 9,210 9,703 10,200 26 Federal and related agencies 46,721 58,320 66,891 66,753 70,006 72,014 73,991 77,919 27 Government National Mortgage Assn. 4,029 4,846 7,438 4,241 3,660 3,291 3,283 3,523 28 1-to 4-family 1,455 2,248 4,728 1,970 1,548 948 922 989 29 Multifamily 2,574 2,598 2,710 2,271 2,112 2,343 2,361 2,534 30 Farmers Home Admin 1,366 1,432 1,109 1,064 1,353 1,179 618 668 31 1- to 4-family 743 759 208 454 626 202 124 135 32 Multifamily 29 167 215 218 275 408 102 110 33 Commercial 218 156 190 72 149 218 104 112 34 Farm 376 350 496 320 303 351 288 311 35 Federal Housing and Veterans Admin. 3,476 4,015 4,970 5,150 5,212 5,219 5,225 5,295 36 1- to 4-family 2,013 2,009 1 ,990 1,676 1,627 1,585 1,543 1,565 37 Multifamily 1,463 2,006 2,980 3,474 3,585 3,634 3,682 3,730 38 Federal National Mortgage Assn... . 24,175 29,578 31,824 32,904 34,369 36,029 38,753 41,189 39 1-to 4-family 20,370 23,778 25,813 26,934 28,504 30,208 32,974 35,437 40 Multifamily 3,805 5,800 6,011 5,970 5,865 5,821 5,779 5,752 41 Federal Land Banks 11,071 13,863 16,563 19,125 22,136 22,925 23,857 24, 758 42 1- to 4-family 123 406 549 601 670 691 727 819 43 Farm 10,948 13,457 16,014 18,524 21,466 22,234 23,130 23,939 44 Federal Home Loan Mortgage Corp.. 2,604 4,586 4,987 4,269 3,276 3,371 2,255 2,486 45 1- to 4-family 2,446 4,217 4,588 3,889 2,738 2,785 1,856 1,994 46 Multifamily 158 369 399 380 538 586 399 492 47 Mortgage pools or trusts2 18,040 23,799 34,138 49,801 70,289 74,080 78,602 82,325 48 Government National Mortgage Assn. 7,890 11,769 18,257 30,572 44,896 46,357 48,032 50,844 49 1- to 4-family 7,561 11,249 17,538 29,583 43,555 44,906 46,515 49,276 50 Multifamily 329 520 719 989 1,341 1,451 1,517 1,568 51 Federal Home Loan Mortgage Corp. 766 757 1,598 2,671 6,610 7,471 9,423 9,934 52 1- to 4-family 617 608 1,349 2,282 5,621 6,286 7,797 8,358 53 Multifamily 149 149 249 389 989 1,185 1,626 1,576 54 Farmers Home Admin 9,384 11,273 14,283 16,558 18,783 20,252 21,147 21,547 55 1- to 4-family 5,458 6,782 9,194 10,219 11,379 12,235 12,742 12,943 56 Multifamily 138 116 295 532 759 732 1,128 1,154 57 Commercial 1 ,124 1,473 1,948 2,440 2,945 3,528 3,301 3,380 58 Farm, 2,664 2,902 2,846 3,367 3,682 3,757 3,976 4,070 59 Individuals and others3 112,160 117,833 119,315 125,123 138,111 141,599 144,888 148,890 60 1- to 4-family 51 ,112 53,331 56,268 62,643 71,665 73,878 75,763 78,054 61 Multifamily 23,982 24,276 22,140 20,420 20,501 20,732 20,939 21,128 62 Commercial 21,303 23,085 22,569 21,446 22,375 22,479 22,661 23,146 63 Farm 15,763 17,141 18,338 20,614 23,570 24,510 25,525 26,562 1 Includes loans held by nondeposit trust companies but not bank trust NOTE. Based on data from various institutional and government departments. sources, with some quarters estimated in part by Federal Reserve in 2 Outstanding principal balances of mortgages backing securities in- conjunction with the Federal Home Loan Bank Board and the Departsured or guaranteed by the agency indicated. ment of Commerce. Separation of nonfarm mortgage debt by type of 3 Other holders include mortgage companies, real estate investment property, if not reported directly, and interpolations and extrapolations trusts, state and local credit agencies, state and local retirement funds, where required, are estimated mainly by Federal Reserve. Multifamily noninsured pension funds, credit unions, and U.S. agencies for which debt refers to loans on structures of five or more units. amounts are small or separate data are not readily available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A42 Domestic Nonfinancial Statistics • February 1979 1.55 CONSUMER INSTALLMENT CREDIT1 Total Outstanding, and Net Changej Millions of dollars 1978 Holder, and type of credit 1976 1977 1978 July Aug. Sept. Oct. Nov. Dec. Amounts outstanding (end of period) 1 Total. 193,977 230,829 275,640 249,865 253,897 259,614 263,387 265,821 269,445 275,640 By major holder: 2 Commercial banks 93,728 112,373 136,189 124,080 126,619 129,622 131,403 132,702 133,908 136,189 3 Finance companies 38,919 44,868 54,309 48,637 49,502 50,558 51,280 51,984 53,099 54,309 4 5 C R r e e ta d i i l t e r u s n 2 i ons 3 1 1 9 , , 1 2 6 6 9 0 2 3 3 7 , ,6 4 0 9 5 0 4 24 5 , , 8 9 7 3 6 9 2 4 1 1 , , 8 9 1 3 3 6 4 2 2 1 , , 3 8 5 2 5 8 4 22 3 , , 0 4 9 9 3 9 4 2 4 2 , , 3 3 2 0 5 2 2 4 2 4, , 6 4 3 6 5 4 4 2 5 3 , , 3 0 0 0 5 6 4 24 5 , , 8 9 7 3 6 9 6 Savings and loans 6,246 7,354 8,394 7,764 7,793 7,947 8,055 8,177 8,291 8,394 7 Gasoline companies. .. 2,830 2,963 3,240 3,185 3,309 3,354 3,416 3,276 3,173 3,240 8 Mutual savings banks., 1,825 2,176 2,693 2,450 2,491 2,541 2,606 2,583 2,663 2,693 By major type of credit: 9 Automobile 67,707 82,911 102,468 93,261 95,289 97,687 99,062 100,159 101,565 102,468 10 Commercial banks . . 39,621 49,577 60,564 55,754 57,071 58,453 59,085 59,778 60,347 60,564 11 Indirect paper 22,072 27,379 33,850 31,128 31,907 32,667 33,067 33,415 33,709 33,850 12 Direct loans 17,549 22,198 26,714 24,626 25,164 25,786 26,018 26,363 26,638 26,714 13 Credit unions 15,238 18,099 21,976 20,054 20,254 20,801 21,196 21,344 21,664 21,967 14 Finance companies.. 12,848 15,235 19,937 17,453 17,964 18,433 18,781 19,037 19,554 19,937 15 Revolving 17,189 39,274 4477,,005511 4400,,000011 4400,,555533 4411,,662299 4422,,442200 4422,,557799 4433,,552233 4477,,005511 16 Commercial banks. . 14,359 18,374 2244,,443344 2200,,113355 2200,,556666 2211,,331144 2211,,993355 2222,,116655 2222,,772244 2244,,443344 17 Retailers 17,937 1199,,337777 1166,,668811 1166,,667788 1166,,996611 1177,,006699 1177,,113388 1177,,662266 1199,,337777 18 Gasoline companies. 2,830 2,963 33,,224400 33,,118855 33,,330099 33,,335544 33,,441166 33,,227766 33,,117733 33,,224400 19 Mobile home 14,573 15,141 16,042 15,532 15,663 15,799 15,910 15,925 16,017 16,042 20 Commercial banks. 8,737 9,124 9,553 9,386 9,483 9,539 9,591 9,548 9,572 9,553 21 Finance companies. 3,263 3,077 3,152 3,065 3,085 3,101 3,114 3,127 3,150 3,152 22 Savings and loans.. 2,241 2,538 2,848 2,634 2,644 2,696 2,733 2,775 2,813 2,848 23 Credit unions 332 402 489 447 451 463 472 475 482 489 24 Other 94,508 93,503 110,079 101,071 102,392 104,499 105,995 107,158 108,340 110,079 25 Commercial banks 31,011 35,298 41,638 38,805 39,499 40,316 40,792 41,211 41,265 41,638 26 Finance companies 22,808 26,556 31,220 28,119 28,453 29,024 29,385 29,820 30,395 31,220 27 Credit unions 15,599 19,104 23,483 21,435 21,650 22,235 22,657 22,816 23,159 23,483 28 Retailers 19,260 5,553 5,499 5,132 5,150 5,132 5,233 5,326 5,380 5,499 29 Savings and loans 4,005 4,816 5,546 5,130 5,149 5,251 5,322 5,402 5,478 5,546 30 Mutual savings banks. 1,825 2,176 2,693 2,450 2,491 2,541 2,606 2,583 2,663 2,693 Net change (during period) 3 31 Total. 21,647 35,278 45,066 4,207 3,466 3,632 3,680 3,374 4,099 4,400 By major holder: 32 Commercial banks 10,792 18,645 24,058 2,387 2,100 1,785 1,714 1,617 1,925 2,080 33 Finance companies 2,946 5,948 9,441 624 671 736 847 863 1,018 1,098 34 Credit unions 5,503 6,436 8,334 797 513 613 639 644 779 773 35 Retailers i 1,059 2,654 1,386 234 144 342 328 115 186 196 36 Savings and loans 1,085 1,111 1,041 57 10 107 94 127 88 115 37 Gasoline companies . ., 124 132 276 20 -19 -1 9 16 96 38 Mutual savings banks. 138 352 530 88 47 50 49 -8 104 42 By major type of credit: 39 Automobile 10,465 15,204 19,557 1,642 1,711 1,604 1,532 1,375 1,755 1,780 40 Commercial banks. . 6,334 9,956 10,987 1,029 1,041 957 848 759 839 845 41 Indirect paper.... 2,742 5,307 6,471 587 626 515 517 354 440 530 42 Direct loans 3,592 4,649 4,516 442 415 442 331 405 399 315 43 Credit unions 2,497 2,861 3,868 349 275 287 313 301 364 391 44 Finance companies.. 1,634 2,387 4,702 264 395 360 371 315 552 544 45 Revolving 2,170 6,248 7,776 955 600 737 622 346 665 869 46 Commercial banks. . 2,046 4,015 6,060 601 498 358 380 337 556 610 47 Retailers 2,101 1,440 334 121 380 233 -7 110 163 48 Gasoline companies. 124 132 276 20 -19 -1 9 16 -1 96 49 Mobile home 140 565 897 70 83 79 72 25 75 71 50 Commercial banks. 70 387 426 50 65 20 31 -25 19 21 51 Finance companies. -182 -189 74 1 11 7 6 -2 15 11 52 Savings and loans.. 192 297 310 12 2 46 27 46 34 30 53 Credit unions 60 70 87 7 5 6 8 6 7 9 54 Other 8,872 13,261 16,836 1,540 1,072 1,212 1,454 1,628 1,604 1,680 55 Commercial banks 2,342 4,287 6,585 707 496 450 455 546 511 604 56 Finance companies 1,494 3,750 4,665 359 265 369 470 550 451 543 57 Credit unions 2,946 3,505 4,379 441 233 320 318 337 408 373 58 Retailers 1,059 553 -54 -100 23 -38 95 122 76 33 59 Savings and loans 893 814 731 45 8 61 67 81 54 85 60 Mutual savings banks. 138 352 530 88 47 50 49 -8 104 42 1 The board's series cover most short- and intermediate-term credit NOTE. Total consumer noninstallment credit outstanding—credit extended to individuals through regular business channels, usually to scheduled to be repaid in a lump sum, including single-payment loans, finance the purchase of consumer goods and services or to refinance charge accounts, and service credit—amounted to $64.3 billion at the end debts incurred for such purposes, and scheduled to be repaid (or with of 1978, $58.6 billion at the end of 1977, $54.8 billion at the end of 1976, the option of repaying in two or more installments). and $50.9 billion at the end of 1975. Comparable data for Dec. 31, 1979 2 Includes auto dealers and excludes 30-day charge credit held by will be published in the February 1980 BULLETIN. travel and entertainment companies. A Consumer installment credit series have been revised from 1943. 3 Net change equals extensions minus liquidations (repayments, charge- effective Dec. 7, 1978. Information is available from Mortgage and offs, and other credits); figures for all months are seasonally adjusted. Consumer Finance Section, Division of Research and Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Consumer Debt A43 1.56 CONSUMER INSTALLMENT CREDIT Extensions and Liquidations A Millions of dollars 1978 Holder, and type of credit 1976 1977 1978 June July Aug. Sept. Oct. Nov. Extensions2 1 Total 211,028 254,071 298,574 25,565 25,022 25,669 25,536 25,785 26,214 By major holder: 2 Commercial banks 97,397 117,896 142,965 12,382 12,187 12,255 12,123 12,182 12,476 3 Finance companies 36,129 41,989 50,483 4,223 4,261 4,348 4,372 4,605 4,512 4 Credit unions 29,259 34,028 40,023 3,445 3,271 3,379 3,360 3,401 3,530 5 Retailers1 29,447 39,133 41,619 3,552 3,477 3,725 3,718 3,518 3,571 6 Savings and loans 3,898 4,485 5,050 379 327 435 403 566 489 7 Gasoline companies. ., 13,387 14,617 16,125 1,351 1,299 1,317 1,346 1,335 1,376 8 Mutual savings banks. 1,511 1,923 2,309 233 200 210 215 151 260 By major type of credit: 9 Automobile 63,743 75,641 88,986 7,595 7,652 7,744 7,542 7,501 7,787 10 Commercial banks. . 37,886 46,363 53,028 4,541 4,639 4,660 4,479 4,345 4,503 11 Indirect paper 20,576 25,149 29,336 2,505 2,554 2,562 2,519 2,384 2,422 12 Direct loans 17,310 21,214 23,692 2,036 2,085 2,098 1,960 1,961 2,081 13 Credit unions 14,688 16,616 19,486 1,667 1,629 1,632 1,641 1,643 1,718 14 Finance companies.. 11,169 12,662 16,472 1,387 1,384 1,452 1,422 1,513 1,566 15 Revolving 43,934 86,756 104,587 9.062 8,700 9,028 9,006 8,846 9,176 16 Commercial banks. . 30,547 38,256 51,531 4,451 4,320 4,346 4,457 4,475 4,702 17 Retailers 33,883 36,931 3,260 3,081 3.365 3,203 3,036 3,098 18 Gasoline companies. 13,387 14,617 16,125 1,351 1,299 1,317 1,346 1,335 1,376 19 Mobile home 4,859 5,425 6,067 510 509 531 494 604 486 20 Commercial banks. 3,064 3,466 3,704 327 335 310 297 352 280 21 Finance companies. 702 643 886 73 78 75 77 73 77 22 Savings and loans.. 929 1,120 1,239 90 78 127 100 154 108 23 Credit unions 164 196 238 20 18 19 20 25 21 24 Other 98,492 86,249 98,934 8,398 8,161 8.366 8,495 8,807 ,765 25 Commercial banks 25,900 29,811 34,702 3.063 2,893 2,939 2,890 3,010 ,991 26 Finance companies 24,258 28,684 33,125 2,763 2,799 2,821 2,873 3,019 ,869 27 Credit unions 14,407 17,216 20,299 1,758 1,624 1,728 1,699 1,733 ,791 28 Retailers 29,447 5,250 4,688 292 396 360 515 482 473 29 Savings and loans 2,969 3,365 3,811 289 249 308 303 412 381 30 Mutual savings banks. 1,511 1,923 2,309 233 200 210 215 151 260 Liquidations2 31 Total. 189,381 218,793 253,508 21,358 21,556 22,037 21,857 22,384 22,115 22,100 By major holder: 32 Commercial banks 86,605 99,251 118,907 9,995 10,087 10,470 10,409 10,565 10,551 10,441 33 Finance companies 33,183 36,041 41,042 3,599 3,590 3,612 3,525 3,742 3,494 3,581 34 Credit unions 23,756 27,592 31,689 2,648 2,758 2,766 2,721 2,757 2,751 2,753 35 Retailers i 28,388 36,479 40,233 3,318 3,333 3,383 3,390 3,403 3,385 3,416 36 Savings and loans 2,813 3,374 4,009 322 317 328 309 439 401 401 37 Gasoline companies. .. 13,263 14,485 15,849 1,331 1,318 1,318 1,337 1,319 1,377 1,355 38 Mutual savings banks. 1,373 1,571 1,779 145 153 160 166 159 156 153 By major type of credit: 39 Automobile 53,278 60,437 69,429 5,953 5,941 6,140 6,010 6,126 6,032 6,053 40 Commercial banks . . 31,552 36,407 42,041 3,512 3,598 3,703 3,631 3,586 3,664 3,598 41 Indirect paper. . .. 17,834 19,842 22,865 1,918 1,928 2,047 2,002 2,030 1,982 1,921 42 Direct loans 13,718 16,565 19,176 1,594 1,670 1,656 1,629 1,556 1,682 1,677 43 Credit unions 12,191 13,755 15,618 1,318 1,354 1,345 1,328 1,342 1,354 1,347 44 Finance companies.. 9,535 10,275 11,770 1,123 989 1,092 1,051 1,198 1,014 1,108 45 Revolving 41,764 80,508 96,811 8,107 8,100 8,291 8,384 8,500 8,511 8,555 46 Commercial banks. . 28,501 34,241 45,471 3,850 3,822 3,988 4,077 4,138 4,146 4,204 47 Retailers 31,782 35,491 2,926 2,960 2,985 2,970 3,043 2,988 2,996 48 Gasoline companies. 13,263 14,485 15,849 1,331 1,318 1,318 1,337 1,319 1,377 1,355 49 Mobile home 4,719 4,860 5,170 440 426 452 422 579 411 431 50 Commercial banks. 2,994 3,079 3,278 277 270 290 266 377 261 274 51 Finance companies. 884 832 812 72 67 68 71 75 62 63 52 Savings and loans.. 737 823 929 78 76 81 73 108 74 81 53 Credit unions 104 126 151 13 13 13 12 19 14 13 54 Other 89,620 72,988 82,098 6,858 7,089 7,154 7,041 7,179 7,161 7,061 55 Commercial banks 23,558 25,524 28,117 2,356 2,397 2,489 2,435 2,464 2,480 2,365 56 Finance companies 22,764 24,934 28,460 2,404 2,534 2,452 2,403 2,469 2,418 2,410 57 Credit unions 11,461 13,711 15,920 1,317 1,391 1,408 1,381 1,396 1,383 1,393 58 Retailers 28,388 4,697 4,742 392 373 398 420 360 397 420 59 Savings and loans 2,076 2,551 3,080 244 241 247 236 331 327 320 60 Mutual savings banks. 1,373 1,571 1,779 145 153 160 166 159 156 153 1 Includes auto dealers and excludes 30-day charge credit held by A Consumer installment credit series have been revised from 1943, travel and entertainment companies. effective Dec. 7, 1978. Information is available from Mortgage and Con- 2 Monthly figures are seasonally adjusted. sumer Finance Section, Division of Research and Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A44 Domestic Nonfinancial Statistics • February 1979 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1975 1976 1977 1978 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 1973 1974 1975 1976 1977 HI H2 HI H2 HI H2 HI Nonfinancial sectors 1 Total funds raised 203.8 188.8 208.1 272.5 340.5 177.5 238.9 259.6 285.6 302.2 378.9 371.4 2 Excluding equities 196.1 184.9 198.0 261.7 337.4 167.0 229.2 245.9 277.5 301.0 373.8 371.3 By sector and instrument: 3 U.S. government 8.3 11.8 85.4 69.0 56.8 78.3 92.5 73.5 64.5 42.6 71.0 58.8 4 Public debt securities 7.9 12.0 85.8 69.1 57.6 79.1 92.6 73.4 64.9 43.1 72.2 59.7 5 Agency issues and mortgages .4 -.2 -.4 —. 1 -.9 -.8 —. 1 . 1 -.3 -.6 -1.2 -.9 6 All other nonfinancial sectors 195.5 177.0 122.7 203.5 283.8 99.2 146.4 186.0 221.0 259.6 307.9 312.6 7 Corporate equities 7.7 3.8 10.1 10.8 3.1 10.5 9.7 13.6 8.1 1.2 5.1 . l 8 Debt instruments 187.9 173.1 112.6 192.6 280.6 88.7 136.6 172.4 213.0 258.5 302.8 312.5 9 Private domestic nonfinancial sectors. . 189.3 161.6 109.5 182.8 271.4 89.1 130.0 168.5 197.2 252.1 290.7 298.8 10 Corporate equities 7.9 4.1 9.9 10.5 2.7 10.3 9.5 13.3 7.7 .5 4.9 .9 11 Debt instruments 181.4 157.5 99.6 172.3 268.7 78.8 120.5 155.2 189.5 251.6 285.8 297.9 12 Debt capital instruments 105.0 98.0 97.8 126.8 181.1 93.7 101.9 117.8 135.9 163.4 198.9 182.7 13 State and local obligations.... 14.7 16.5 15.6 19.0 29.2 11.1 20.0 19.3 18.7 29.3 29.0 29.0 14 Corporate bonds 9.2 19.7 27.2 22.8 21.0 34.5 19.9 22.2 23.5 16.0 26.0 18.4 Mortgages: 15 Home 46.4 34.8 39.5 63.7 96.4 33.9 45.1 56.9 70.5 88.5 104.2 91.4 16 Multifamily residential 10.4 6.9 * 1.8 7.4 . 1 -.1 .6 3.1 6.4 8.4 9.7 17 Commercial 18.9 15.1 11.0 13.4 18.4 9.1 12.9 13.8 12.9 14.2 22.6 24.5 18 Farm 5.5 5.0 4.6 6.1 8.8 5.1 4.1 4.9 7.3 8.9 8.7 9.8 19 Other debt instruments 76.4 59.6 1.8 45.5 87.6 -14.9 18.6 37.4 53.6 88.2 86.9 115.2 20 Consumer credit 23.8 10.2 9.4 23.6 35.0 2.2 16.6 22.9 24.3 35.7 34.4 44.8 21 Bank loans n.e.c 39.8 29.0 -14.0 3.5 30.6 -23.7 -4.3 -2.7 9.6 34.0 27.2 47.1 22 Open market paper 2.5 6.6 -2.6 4.0 2.9 -1.9 -3.2 5.6 2.4 3.5 2.4 5.2 23 Other 10.3 13.7 9.0 14.4 19.0 8.5 9.5 11.6 17.3 15.0 23.0 18.1 24 By borrowing sector 189.3 161.6 109.5 182.8 271.4 89.1 130.0 168.5 197.2 252.1 290.7 298.8 25 State and local governments 13.2 15.5 13.2 18.5 25.9 8.8 17.5 17.6 19.5 22.7 29.0 22.1 26 Households 80.9 49.2 48.6 89.9 139.6 37.1 60.2 82.7 97.1 131.2 148.0 147.7 27 Farm 9.7 7.9 8.7 11.0 14.7 8.5 9.0 9.9 12.1 15.5 13.8 15.8 28 Nonfarm noncorporate 12.8 7.4 2.0 5.2 12.6 -1.0 5.1 4.0 6.4 12.8 12.3 20.7 29 Corporate 72.7 81.8 37.0 58.2 78.7 35.8 38.2 54.3 62.2 69.8 87.6 92.5 30 Foreign 6.2 15.3 13.2 20.7 12.3 10.0 16.4 17.5 23.8 7.5 17.2 13.8 31 Corporate equities -.2 -.2 .2 .3 .4 .1 .2 .3 .3 .6 .2 -.8 32 Debt instruments 6.4 15.6 13.0 20.4 11.9 9.9 16.2 17.2 23.5 6.9 17.0 14.6 33 Bonds 1.0 2.1 6.2 8.5 5.0 5.7 6.8 7.4 9.7 4.4 5.6 4.9 34 Bank loans n.e.c 2.8 4.7 3.7 6.6 1.6 1.6 5.9 5.4 7.9 -3.2 6.4 2.9 35 Open market paper .9 7.3 .3 1.9 2.4 -.8 1.4 1.5 2.4 2.7 2.2 3.6 36 U.S. government loans 1.7 1.5 2.8 3.3 3.0 3.4 2.2 2.9 3.6 3.1 2.9 3.2 Financial sectors 37 Total funds raised 57.6 36.4 11.7 29.2 58.8 12.4 10.9 27.9 30.5 61.5 56.2 101.5 By instrument: 38 U.S. government related 19.9 23.1 13.5 18.6 26.3 14.2 12.9 18.2 19.0 25.0 27.5 40.1 39 Sponsored credit agency securities 16.3 16.6 2.3 3.3 7.0 1.6 3.1 4.1 2.6 9.5 4.4 24.1 40 Mortgage pool securities 3.6 5.8 10.3 15.7 20.5 11.5 9.2 14.2 17.2 17.9 23.1 16.0 41 Loans from U.S. government .7. .9 - .4 -1.2 1.1 .6 * — .7 -2.3 42 Private financial sectors 37.7 13.3 -1.9 10.6 32.6 — 1.8 -2.0 9.7 11.5 36.5 28.7 61.4 43 Corporate equities 1.5 .3 .6 1.0 .6 .6 .6 -.2 2.3 .5 .7 1.1 44 Debt instruments 36.2 13.0 -2.5 9.6 32.0 -2.4 -2.6 10.0 9.2 36.0 28.0 60.3 45 Corporate bonds 3.5 2.1 2.9 5.8 10.1 1.9 4.0 6.4 5.2 10.1 10.1 8.5 46 Mortgages -1.2 -1.3 2.3 2.1 3.1 1.4 3.1 1.5 2.7 3.3 2.9 2.4 47 Bank loans n.e.c 8.9 4.6 -3.6 -3.7 * -4.3 -2.9 -2.6 -4.8 -2.3 2.3 .4 48 Open market paper and RPs 17.8 .9 -.1 7.3 14.4 5.1 -5.4 6.2 8.5 21.4 7.4 35.0 49 Loans from FHLBs 7.2 6.7 -4.0 -2.0 4.3 -6.5 -1.4 -1.5 -2.5 3.4 5.2 14.1 By sector: 57.6 36.4 11.7 29.2 58.8 12.4 10.9 27.9 30.5 61.5 56.2 101.5 50 Sponsored credit agencies 16.3 17.3 3.2 2.9 5.8 2.7 3.8 4.0 1.8 7.1 4.4 24.1 51 Mortgage pools 3.6 5.8 10.3 15.7 20.5 11.5 9.2 14.2 17.2 17.9 23.1 16.0 52 Private financial sectors 37.7 13.3 -1.9 10.6 32.6 -1.8 -2.0 9.7 11.5 36.5 28.7 61.4 53 Commercial banks 14.1 -5.6 -1.4 7.5 4.8 3.9 -6.7 9.0 6.0 10.0 -.4 12.2 54 Bank affiliates 2.2 3.5 .3 -.8 1.3 .9 -.3 -1.3 -.3 1.3 1.2 5.8 55 Savings and loan associations 6.0 6.3 -2.2 * 11.9 -7.2 2.7 .1 _ i 10.6 13.1 19.6 56 Other insurance companies .5 .9 1.0 .9 .9 .9 1.0 .9 '.9 .9 1.0 1.0 57 Finance companies 9.4 6.0 .6 6.4 16.9 -2.2 3.4 6.0 6.9 17.4 16.4 18.7 58 REITs 6.5 .6 -1.4 -2.4 -2.4 -1.5 -1.2 -2.1 -2.7 -2.5 -2.2 -1.2 59 Open-end investment companies -1.2 -.7 — 1 -1.0 -1.0 .8 -1.0 -2.4 .4 -.8 -1.2 -.6 6600 Money market funds 22..44 1.3 * ..22 22..66 1 --..55 ..55 — .5 ..99 55..99 All sectors 61 Total funds raised, by instrument 261.4 225.1 219.8 301.7 399.4 189.8 249.8 287.5 316.0 363.7 435.0 472.9 62 Investment company shares -1.2 -.7 -.1 -1.0 -1.0 .8 -1.0 -2.4 .4 -.8 -1.2 -.6 63 Other corporate equities 10.4 4.8 10.8 12.9 4.8 10.3 11.3 15.8 9.9 2.5 7.0 1.7 64 Debt instruments 252.3 221.0 209.1 289.8 395.6 178.8 239.5 274.1 305.7 362.0 429.2 471.7 65 U.S. government securities 28.3 34.3 98.2 88.1 84.3 91.5 104.9 91.9 84.3 70.0 98.6 99.0 66 State and local obligations 14.7 16.5 15.6 19.0 29.2 11.1 20.0 19.3 18.7 29.3 29.0 29.0 67 Corporate and foreign bonds 13.6 23.9 36.4 37.2 36.1 42.1 30.7 36.1 38.4 30.5 41.7 31.8 68 Mortgages 79.9 60.5 57.2 87.1 134.0 49.4 65.0 77.7 96.4 121.2 146.7 137.6 69 Consumer credit 23.8 10.2 9.4 23.6 35.0 2.2 16.6 22.9 24.3 35.7 34.4 44.8 70 Bank loans n.e.c 51.6 38.3 -13.9 6.4 32.2 -26.4 -1.3 .1 12.6 28.4 35.9 50.4 71 Open market paper and RPs 21.2 14.8 -2.4 13.3 19.8 2.4 -7.3 13.3 13.3 27.6 11.9 43.7 72 Other loans 19.1 22.6 8.7 15.3 25.1 6.5 10.9 12.9 17.7 19.2 31.0 35.4 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; quarterly data are at seasonally adjusted annual rates. 1975 1976 1977 1978 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 11997733 11997744 11997755 11997766 11997777 HI H2 HI H2 HI H2 HI 1 Total funds advanced in credit markets to nonfinancial sectors 196.1 184.9 198.0 261.7 337.4 167.0 229.2 245.9 277.5 301.0 373.8 371.3 By public agencies and foreign: 2 Total net advances 34.1 52.6 44.3 54.5 85.4 51.9 3366..77 49.7 5599..33 6699..33 110011..66 110022..99 3 U.S. government securities 9.5 11.9 22.5 26.8 40.2 31.2 13.7 24.4 29.3 27.2 53.2 42.6 4 Residential mortgages 8.2 14.7 16.2 12.8 20.4 16.8 15.7 11.8 13.7 20.0 20.9 22.9 5 FHLB advances to S&Ls 7.2 6.7 -4.0 -2.0 4.3 -6.5 -1.4 -1.5 -2.5 3.4 5.2 14.1 6 Other loans and securities 9.2 19.4 9.5 16.9 20.5 10.4 8.7 15.0 18.8 18.6 22.4 23.4 Totals advanced, by sector 7 U.S. government 2.8 9.7 15.1 8.9 11.8 15.8 14.3 6.3 11.5 6.1 17.6 19.2 8 Sponsored credit agencies 21.4 25.6 14.5 20.6 26.9 16.0 13.1 20.0 21.2 26.1 27.2 44.3 9 Monetary authorities 9.2 6.2 8.5 9.8 7.1 7.0 10.1 13.7 6.0 10.2 4.1 12.9 10 Foreign .6 11.2 6.1 15.2 39.5 13.0 -.8 9.7 20.6 26.4 52.7 26.5 11 Agency borrowing not included in line 1.. 19.9 23.1 13.5 18.6 26.3 14.2 12.9 18.2 19.0 25.0 27.5 40.1 Private domestic funds advanced 12 Total net advances 182.0 155.3 167.3 225.7 278.2 129.3 205.4 214.4 237.1 256.8 299.7 308.5 13 U.S. government securities 18.8 22.4 75.7 61.3 44.1 60.2 91.2 67.5 55.1 42.8 45.4 56.4 14 State and local obligations 14.7 16.5 15.6 19.0 29.2 11.1 20.0 19.3 18.7 29.3 29.0 29.0 15 Corporate and foreign bonds 10.0 20.9 32.8 30.5 22.3 40.0 25.6 28.6 32.3 17.2 27.3 21.7 16 Residential mortgages 48.4 26.9 23.2 52.7 83.2 17.1 29.2 45.6 59.7 74.9 91.6 78.0 17 Other mortgages and loans 97.2 75.4 16.1 60.4 103.7 -5.7 37.9 51.9 68.9 96.0 111.5 137.4 18 LESS : FHLB advances 7.2 6.7 -4.0 -2.0 4.3 -6.5 -1.4 -1.5 -2.5 3.4 5.2 14.1 Private financial intermediation 19 Credit market funds advanced by private financial institutions 165.4 126.2 119.9 191.2 249.6 101.2 138.7 174.4 207.9 241.1 258.0 279.8 20 Commercial banking 86.5 64.5 27.6 58.0 85.8 14.8 40.5 46.6 69.4 81.1 90.5 115.8 21 Savings institutions 36.9 26.9 52.0 71.4 84.8 49.3 54.6 70.5 72.4 85.3 84.3 77.1 22 Insurance and pension funds 23.9 30.0 41.5 51.7 62.0 38.1 44.9 53.2 50.2 60.3 63.7 69.3 23 Other finance 18.0 4.7 -1.1 10.1 16.9 -.9 -1.3 4.2 15.9 14.5 19.4 17.7 24 Sources of funds 165.4 126.2 119.9 191.2 249.6 101.2 138.7 174.4 207.9 241.1 258.0 279.8 25 Private domestic deposits 86.6 69.4 90.6 121.5 136.0 89.9 91.3 108.3 134.6 127.0 145.0 119.4 26 Credit market borrowing 36.2 13.0 -2.5 9.6 32.0 -2.4 -2.6 10.0 9.2 36.0 28.0 60.3 27 Other sources 42.5 43.8 31.9 60.1 81.6 13.7 50.0 56.1 64.1 78.2 85.1 100.1 28 Foreign funds 5.8 16.8 .9 5.1 11.6 -.5 2.4 .7 9.5 .1 22.4 2.1 29 Treasury balances -1.0 -5.1 -1.7 —. 1 4.3 -3.8 .4 2.3 -2.5 -1.8 10.4 -.8 30 Insurance and pension reserves 18.4 26.0 29.6 34.8 48.0 27.4 31.7 35.8 33.8 45.5 50.4 55.4 31 Other, net 19.4 6.0 3.1 20.3 17.8 -9.4 15.6 17.2 23.4 33.7 1.9 43.4 Private domestic nonfinancial investors 32 Direct lending in credit markets 52.8 42.2 44.9 44.1 60.6 25.7 64.1 50.0 38.4 51.6 69.6 59.0 33 U.S. government securities 19.2 17.5 23.0 19.6 24.6 6.0 39.9 25.0 14.1 14.1 35.2 35.8 34 State and local obligations 5.4 9.3 8.3 6.8 9.1 5.8 10.8 7.6 6.0 8.2 10.1 11.6 35 Corporate and foreign bonds 1.3 4.7 8.0 2.1 1.1 10.7 5.3 2.9 1.3 .4 1.8 -2.5 36 Commercial paper 18.3 2.4 -.8 4.1 9.5 -1.8 .2 4.8 3.4 13.0 6.0 28.6 37 Other 8.6 8.2 6.4 11.5 16.2 4.9 7.8 9.7 13.5 15.9 16.5 17.6 38 Deposits and currency 90.6 75.7 96.8 128.8 144.3 96.4 97.2 114.3 143.3 132.6 156.0 129.5 39 Time and savings accounts 76.1 66.7 84.8 112.2 120.1 75.6 93.9 99.5 125.0 110.5 129.7 110.9 40 Large negotiable CDs 18.1 18.8 -14.1 -14.4 9.3 -27.8 -.3 -19.8 -9.1 -4.4 22.9 11.5 41 Other at commercial banks 29.6 26.1 39.4 58.1 41.7 40.5 38.2 52.0 64.3 45.3 38.2 44.5 42 At savings institutions 28.5 21.8 59.4 68.5 69.1 62.9 56.0 67.3 69.8 69.6 68.7 54.9 43 Money 14.4 8.9 12.0 16.6 24.2 20.8 3.3 14.8 18.3 22.1 26.3 18.6 44 Demand deposits 10.5 2.6 5.8 9.3 15.9 14.3 -2.6 8.9 9.6 16.5 15.3 8.5 45 Currency 3.9 6.3 6.2 7.3 8.3 6.5 5.9 6.0 8.6 5.6 11.0 10.1 46 Total of credit market instruments, deposits and currency 143.4 117.8 141.6 172.9 204.9 122.1 161.3 164.3 181.6 184.2 225.6 218.5 47 Public support rate (in per cent) 17.4 28.5 22.4 20.8 25.3 31.1 16.0 20.2 21.4 23.0 27.2 27.7 48 Private financial intermediation (in per cent) 90.9 81.3 71.7 84.7 89.7 78.3 67.5 81.3 87.7 93.9 86.1 90.7 49 Total foreign funds 6.4 28.0 7.1 20.3 51.1 12.5 1.6 10.4 30.1 27.1 75.1 28.5 MEMO: Corporate equities not included above 50 Total net issues 9.2 4.1 10.7 11.9 3.8 11.1 10.3 13.4 10.4 1.7 5.8 1.1 51 Mutual fund shares -1.2 -.7 — l -1.0 -1.0 .8 -1.0 -2.4 .4 -.8 -1.2 -.6 52 Other equities 10.4 4.8 10.8 12.9 4.8 10.3 11.3 15.8 9.9 2.5 7.0 1.7 53 Acquisitions by financial institutions 13.3 5.8 9.7 12.5 6.2 11.5 7.8 13.1 12.0 6.1 6.3 1.6 54 Other net purchases -4.1 -1.6 1.0 -.7 -2.4 -.4 2.5 .3 -1.6 -4.4 -.5 -.5 NOTES BY LINE NUMBER. 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. Sum of lines 39 and 44. 49. Sum of lines 10 and 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 • February 1979 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures 1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted. 1978 1979 MMeeaassuurree 11997766 11997777 11997788?? June July Aug. Sept. Oct.r Nov.f Dec.p Jan.e 129.8 137.1 145.1 144.9 146.1 147.1 147.8 148.7 149.5 150.5 150.7 Market groupings: 2 Products, total 129.3 137.1 144.3 144.0 145.0 146.2 146.5 147.0 147.6 148.7 149.0 3 Final, total 127.2 134.9 141.3 141.1 142.2 143.3 143.7 144.1 144.6 145.5 145.7 4 Consumer goods 136.2 143.4 147.4 147.0 147.7 148.4 149.0 149.2 149.8 150.7 150.8 5 Equipment 114.6 123.2 133.0 133.0 134.7 136.3 136.4 137.0 137.3 138.3 138.5 6 Intermediate 137.2 145.1 155.1 154.7 155.6 156.4 157.0 158.0 159.0 160.7 161.4 7 Materials 130.6 136.9 146.4 146.4 147.9 148.6 149.7 151.4 152.6 153.3 153.3 Industry groupings: 8 Manufacturing 129.5 137.1 145.6 145.5 146.7 147.6 114488..77 114499..55 115500..44 115511..55 115511..66 Capacity utilization (percent)1 80.2 82.4 84.2 84.3 84.7 85.0 85.3 85.5 8855..88 8866..11 85.9 10 Industrial materials industries 80.4 81.9 84.9 85.1 85.7 85.9 86.3 87.1 87.6 87.8 87.5 11 Construction contracts2 190.2 253.2 286.0 249.0 286.0 289.0 300.0 319.0 285.0 303.0 n.a. 12 Nonagricultural employment, total3 120.7 125.0 130.3 130.7 130.8 130.9 131.0 131.6 132.3 132.6 133.1 13 Goods-producing, total r100.2 104.2 108.9 109.3 109.4 109.2 109.3 110.1 111.0 111.7 112.0 14 Manufacturing, total 97.7 101.0 104.5 104.5 104.4 104.3 104.3 105.1 105.9 106.6 106.9 15 Manufacturing, production-worker 95.3 98.6 102.1 102.0 101.8 101.6 101.6 102.4 103.5 104.2 104.7 16 Service-producing 131.9 136.4 142.1 142.5 142.5 142.8 142.9 143.4 144.0 144.1 144.7 17 Personal income, total4 220.4 244.0 272.5 270.6 274.4 276.3 278.4 282.2 285.0 288.0 n.a. 18 Wages and salary disbursements r189.3 230.1 257.5 256.9 259.2 260.0 262.0 266.1 268.8 271.1 n.a. 19 Manufacturing 177.1 198.6 223.5 222.3 224.9 224.5 226.4 230.3 234.5 236.8 n.a. 20 Disposable personal income r217.5 •-239.3 266.5 r269.7 277.6 21 Retail sales s 203.5 224.4 247.9 246.3 244.9 251.7 253.5 257.5 262.0 265.3 266.3 Prices:6 22 Consumer7 170.5 181.5 n.a. 195.3 196.7 197.8 199.3 200.9 202.0 202.9 n.a. 23 Producer finished goods8 170.3 180.6 n.a. 194.5 '196.0 195.3 196.9 199.7 200.6 202.4 n.a. 1 Ratios of indexes of production to indexes of capacity. Based on data 5 Based on Bureau of Census data published in Survey of Current from Federal Reserve, McGraw-Hill Economics Department, and De- Business (U.S. Department of Commerce). partment of Commerce. 6 Data without seasonal adjustment, as published in Monthly Labor 2 Index of dollar value of total construction contracts, including Review (U.S. Department of Labor). Seasonally adjusted data for changes residential, nonresidential, and heavy engineering, from McGraw-Hill in the price indexes may be obtained from the Bureau of Labor Statistics, Informations Systems Company, F. W. Dodge Division. U.S. Department of Labor, 3 The establishment survey data in this table have been revised to con- 7 Beginning Jan. 1978, based on new index for all urban consumers. form to the industry definitions of the 1972 Standard Industrial Classifica- 8 Beginning with the November 1978 BULLETIN, producer price data tion (SIC) Manual and to reflect employment benchmark levels for in this table have been changed to the BLS series for producer finished March 1977. In addition, seasonal factors for these data have been goods. The previous data were producer prices for all commodities. revised, based on experience through May 1978. Based on data in Employment and Earnings (U.S. Department of Labor). Series covers em- NOTE. Basic data (not index numbers) for series mentioned in notes ployees 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. Department of Com- found in the Survey of Current Business (U.S. Department of Commerce). merce). Series for disposable income is quarterly. Figures for industrial production for the last two months are preliminary and estimated, respectively. 2.11 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION Seasonally adjusted 1978 1978 1978 SSeerriieess Ql Q2 Q3 Q4r Ql Q2 Q3 Q4 Ql Q2 Q3 Q4 r Output (1967 = 100) Capacity (percent of 1967 output) Utilization rate (percent) 1 Manufacturing 139.8 144.4 147.7 150.5 170.3 172.0 173.7 175.4 82.1 84.0 85.0 85.8 2 Primary processing 148.2 154.1 158.2 161.6 176.8 178.5 180.2 181.9 83.8 86.3 87.8 88.8 3 Advanced processing 135.4 139.3 142.1 144.5 166.9 168.5 170.2 171.8 81.1 82.7 83.5 84.1 4 Materials 139.2 145.1 148.7 152.4 170.4 171.7 173.0 174.2 81.7 84.5 86.0 87.5 5 Durable goods 137.9 144.0 150.4 155.2 174.0 175.2 176.3 177.4 79.3 82.2 85.3 87.5 6 Basic metal 110.5 117.5 124.6 129.5 145.8 146.1 146.5 146.8 75.8 80.4 85.1 88.2 7 Nondurable goods 158.0 163.2 163.2 166.6 182.3 184.4 186.5 188.5 86.7 88.5 87.5 88.4 8 Textile, paper, and chemical 163.1 167.7 168.4 171.7 190.8 193.1 195.4 197.5 85.5 86.8 86.2 86.9 9 Textile 115.3 117.1 117.3 119.1 143.5 144.1 144.7 145.2 80.3 81.2 81.0 82.0 10 Paper 136.5 139.7 134.8 136.9 153.6 154.8 155.8 156.9 88.9 90.3 86.5 87.2 11 Chemical 194.9 201.4 204.4 208.8 226.6 230.1 233.5 236.8 86.0 87.5 87.5 88.2 12 Energy 119.1 125.5 127.0 128.4 147.2 147.8 148.4 148.9 80.9 84.9 85.6 86.2 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. 1978 1979 CCaatteeggoorryy 11997766 11997777 11997788 July Aug. Sept. Oct. Nov. Dec. Jan. Household survey data 1111 NNNNoooonnnniiiinnnnssssttttiiiittttuuuuttttiiiioooonnnnaaaallll ppppooooppppuuuullllaaaattttiiiioooonnnn1111 156,048 158,559 161,058 161,148 161,348 161,570 161,829 162,033 162,250 162,448 2222 LLLLaaaabbbboooorrrr ffffoooorrrrcccceeee ((((iiiinnnncccclllluuuuddddiiiinnnngggg AAAArrrrmmmmeeeedddd FFFFoooorrrrcccceeeessss))))1111 96,917 99,534 102,537 '102,738 '102,785 '103,097 '103,199 '103,745 103,975 104,277 3333 CCCCiiiivvvviiiilllliiiiaaaannnn llllaaaabbbboooorrrr ffffoooorrrrcccceeee 94,773 97,401 100,420 '100,622 '100,663 '100,974 '101,077 '101,628 '101,867 102,183 EEEEmmmmppppllllooooyyyymmmmeeeennnntttt :::: 4444 NNNNoooonnnnaaaaggggrrrriiiiccccuuuullllttttuuuurrrraaaallll iiiinnnndddduuuussssttttrrrriiiieeeessss2222 84,188 87,302 91,031 '91,069 '91,372 '91,604 '91,867 '92,476 92,468 93,068 5555 AAAAggggrrrriiiiccccuuuullllttttuuuurrrreeee 3,297 3,244 3,342 '3,377 '3,351 '3,406 '3,374 '3,275 3,387 3,232 UUUUnnnneeeemmmmppppllllooooyyyymmmmeeeennnntttt:::: 6666 NNNNuuuummmmbbbbeeeerrrr 7,288 6,855 6,047 '6,176 '5,940 '5,964 '5,836 '5,877 6,012 5,883 7777 RRRRaaaatttteeee ((((ppppeeeerrrrcccceeeennnntttt ooooffff cccciiiivvvviiiilllliiiiaaaannnn llllaaaabbbboooorrrr ffffoooorrrrcccceeee)))) 7.7 7.0 6.0 6.1 5.9 r5.9 5.8 5.8 5.9 5.8 8888 NNNNooootttt iiiinnnn llllaaaabbbboooorrrr ffffoooorrrrcccceeee 59,130 59,025 58,521 '58,410 '58,563 '58,473 '58,630 '58,288 58,275 58,170 Establishment survey data4 9999 NNNNoooonnnnaaaaggggrrrriiiiccccuuuullllttttuuuurrrraaaallll ppppaaaayyyyrrrroooollllllll eeeemmmmppppllllooooyyyymmmmeeeennnntttt3333 79,382 82,256 P85,760 86,033 86,149 86,163 86,573 '87,036 87,248 *87,573 11110000 MMMMaaaannnnuuuuffffaaaaccccttttuuuurrrriiiinnnngggg 18,997 19,647 2*20,331 20,302 20,278 20,286 20,436 '20,601 20,723 2*20,790 11111111 MMMMiiiinnnniiiinnnngggg 779 809 P 837 882 887 887 893 '903 905 2*909 11112222 CCCCoooonnnnttttrrrraaaacccctttt ccccoooonnnnssssttttrrrruuuuccccttttiiiioooonnnn 3,576 3,833 2*4,213 4,317 4,298 4,298 4,341 4,368 4,395 2*4,418 11113333 TTTTrrrraaaannnnssssppppoooorrrrttttaaaattttiiiioooonnnn aaaannnndddd ppppuuuubbbblllliiiicccc uuuuttttiiiilllliiiittttiiiieeeessss.... 4,582 4,696 2*4,858 4,827 4,846 4,855 4,922 '4,947 4,963 2*4,978 11114444 TTTTrrrraaaaddddeeee 17,755 18,492 ^19,392 19,469 19,523 19,546 19,632 '19,701 19,680 2*19,826 11115555 FFFFiiiinnnnaaaannnncccceeee 4,271 4,452 P4,676 4,690 4,707 4,719 4,737 '4,774 4,792 2*4,816 11116666 SSSSeeeerrrrvvvviiiicccceeee 14,551 15,249 2*15,976 15,989 16,074 16,127 16,169 '16,270 16,312 2*16,350 11117777 GGGGoooovvvveeeerrrrnnnnmmmmeeeennnntttt 14,871 15,079 2*15,478 15,557 15,536 15,445 15,443 15,472 15,478 2*15,491 1 Persons 16 years of age and over. Monthly figures, which are based unpaid family workers, and members of the Armed Forces. Data are on sample data, relate to the calendar week that contains the 12th day; adjusted to the February 1977 benchmark. Based on data from Employannual data are averages of monthly figures. By definition, seasonality ment and Earnings (U.S. Dept. of Labor). does not exist in population figures. Based on data from Employment 4 The establishment survey data in this table have been revised to and Earnings (U.S. Dept. of Labor). conform to the industry definitions of the 1972 Standard Industrial 2 Includes self-employed, unpaid family, and domestic service workers. Classification (SIC) Manual and to reflect employment benchmark 3 Data include all full- and part-time employees who worked during, levels for March 1977. In addition, seasonal factors for these data have or received pay for, the pay period that includes the 12th day of the been revised, based on experience through May 1978. month, and exclude proprietors, self-employed persons, domestic servants, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 Domestic Nonfinancial Statistics • February 1979 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value Monthly data are seasonally adjusted. 1967 1977 1978 1978 Grouping 1978 por- avertion agep Nov. Dec. Jan. June July Aug. Sept. Oct.r Nov. Dec.33 Jan." Index (1967 == 100) MAJOR MARKET 1 Total index 100.00 145.1 139.3 139.7 138.8 144.9 146.1 147.1 147.8 148.7 149.5 150.5 150.7 2 Products 60.71 144.3 139.5 140.3 138.5 144.0 145.0 146.2 146.5 147.0 147.6 148.7 149.0 3 Final products 47.82 141.3 137.0 137.6 134.9 141.1 142.2 143.3 143.7 144.1 144.6 145.5 145.7 4 Consumer goods 27.68 147.4 145.2 145.8 141.8 147.0 147.7 148.4 149.0 149.2 149.8 150.7 150.8 5 Equipment 20.14 133.0 125.8 126.2 125.4 133.0 134.7 136.3 136.4 137.0 137.3 138.3 138.5 6 Intermediate products 12.89 155.1 148.4 150.4 151.6 154.7 155.6 156.4 157.0 158.0 159.0 160.7 161.4 7 Materials 39.29 146.4 139.0 138.8 139.2 146.4 147.9 148.6 149.7 151.4 152.6 153.3 153.3 Consumer goods 8 Durable consumer goods 7.89 158.8 155.2 155.8 146.5 160.6 160.9 161.5 160.3 161.6 162.0 161.9 161.1 9 Automotive products 2.83 178.5 173.6 172.4 157.5 179.9 182.2 182.1 178.3 185.6 189.4 185.1 181.1 10 Autos and utility vehicles 2.03 172.5 167.6 165.5 145.5 173.4 176.7 175.6 170.0 180.5 185.7 179.5 173.7 11 Autos 1.90 148.5 147.5 143.6 127.4 149.8 152.7 151.1 144.4 154.2 159.7 151.8 145.9 12 Auto parts and allied goods .80 193.7 188.9 190.4 187.8 193.9 196.1 198.0 199.8 199.1 198.5 199.0 200.1 13 Home goods 5.06 147.8 145.0 146.6 140.3 149.7 148.9 150.0 150.2 148.2 146.8 148.8 149.7 14 Appliances, A/C, and TV 1.40 132.5 131.4 132.8 116.1 139.0 133.7 133.9 134.4 128.7 124.3 129.8 131.4 15 Appliances and TV 1.33 134.5 133.0 134.6 117.4 141.0 136.8 135.6 136.9 129.9 125.4 130.3 16 Carpeting and furniture 1.07 164.3 160.0 161.5 159.1 166.0 168.5 167.9 169.0 168.0 164.9 166.3 17 Miscellaneous home goods 2.59 149.3 146.3 147.7 145.9 148.8 149.1 151.3 150.8 150.6 151.3 151.9 152.8 18 Nondurable consumer goods 19.79 142.8 141.2 141.8 139.9 141.6 142.4 143.1 144.4 144.3 144.9 146.2 146.7 19 Clothing 4.29 126.4 126.9 118.3 124.8 125.1 126.6 128.9 128.3 20 Consumer staples 15.50 H7.6 145.3 145.9 145.9 146.3 147.3 147.8 148.8 148.8 149.2 i50.7 115511..44 21 Consumer foods and tobacco 8.33 140.1 136.7 137.9 136.5 139.0 140.2 140.8 141.2 140.4 141.0 142.6 22 Nonfood staples 7.17 156.3 155.1 155.2 156.6 154.8 155.5 155.9 157.4 158.5 159.0 160.0 116600..77 23 Consumer chemical products 2.63 187.1 186.9 186.5 187.4 185.5 186.7 188.0 190.1 191.9 191.8 193.0 24 Consumer paper products 1.92 118.1 118.5 119.8 121.4 118.0 117.5 117.3 118.2 116.7 117.5 117.7 25 Consumer energy products 2.62 153.4 149.9 149.7 151.5 150.8 151.9 152.0 153.3 155.4 115566..66 115577..77 26 Residential utilities 1.45 155.6 158.5 161.7 159.0 159.9 160.1 160.9 162.8 Equipment 27 Business equipment 12.63 161.9 153.5 154.0 152.6 161.8 163.8 165.4 165.8 166.9 167.2 168.4 168.5 28 Industrial equipment 6.77 149.9 142.6 143.0 144.3 150.9 151.9 152.8 152.7 152.9 151.9 152.2 153.1 29 Building and mining equipment 1.44 223.5 206.7 208.3 211.1 227.3 228.9 228.1 226.3 226.5 223.8 223.0 223.2 30 Manufacturing equipment 3.85 121.9 118.7 118.2 118.8 122.8 122.6 123.9 124.4 125.0 124.2 124.7 125.6 31 Power equipment 1.47 151.0 142.1 143.7 146.1 149.2 152.8 154.6 154.8 154.0 153.4 155.1 156.2 32 Commercial transit, farm equipment... 5.86 175.8 165.9 166.9 162.2 174.4 177.5 179.9 180.8 182.9 185.1 187.0 186.2 33 Commercial equipment 3.26 208.4 197.4 198.8 198.5 206.9 210.6 212.2 214.1 215.1 215.3 216.0 217.4 34 Transit equipment 1.93 133.6 118.9 121.1 111.1 132.3 134.9 138.5 138.6 142.6 147.5 151.2 146.2 35 Farm equipment .67 138.7 147.8 144.5 131.4 137.3 138.5 141.3 142.0 143.2 145.8 149.0 36 Defense and space equipment 7.51 84.5 79.3 79.5 79.7 84.6 85.9 87.1 87.1 86.7 87.2 87.6 88.4 Intermediate products 37 Construction supplies 6.42 153.1 146.5 148.3 149.2 152.1 153.5 154.7 155.6 157.0 158.1 160.3 161.2 38 Business supplies 6.47 157.1 150.1 152.6 153.8 157.0 157.6 158.2 158.4 159.2 159.8 161.1 39 Commercial energy products 1.14 166.2 160.9 165.6 165.5 163.0 164.1 167.4 169.9 168.8 168.6 169.0 Materials 40 Durable goods materials 20.35 146.9 137.2 138.7 138.2 145.4 148.7 150.4 152.1 154.0 154.9 156.7 156.9 41 Durable consumer parts 4.58 140.3 136.5 135.7 133.0 138.7 142.0 142.2 144.8 147.3 147.4 148.5 147.5 42 Equipment parts 5.44 159.0 147.2 149.2 148.7 157.4 161.7 162.9 164.6 166.0 167.6 170.1 171.6 43 Durable materials n.e.c 10.34 143.4 132.3 134.3 134.9 141.8 144.7 147.6 148.7 150.5 151.6 153.4 153.3 44 Basic metal materials 5.57 120.4 107.9 110.3 110.2 118.2 121.7 125.4 126.7 128.2 129.1 131.2 45 Nondurable goods materials 10.47 162.8 155.4 155.3 155.0 164.1 162.5 162.7 164.4 165.7 167.3 166.7 167.3 46 Textile, paper, and chemical materials. 7.62 167.8 159.3 159.3 160.7 168.8 168.3 167.0 170.0 171.0 172.4 171.7 172.5 47 Textile materials 1.85 117.1 117.8 117.3 114.9 118.0 117.1 116.0 118.7 118.7 119.4 119.3 48 Paper materials 1.62 136.9 132.2 130.2 135.0 139.9 135.1 131.5 137.7 137.3 137.6 135.7 49 Chemical materials 4.15 202.5 188.6 189.5 191.4 202.9 204.0 203.7 205.5 207.6 209.8 209.1 50 Containers, nondurable 1.70 160.6 156.7 154.4 150.4 162.8 155.4 161.8 161.1 163.4 165.6 165.9 51 Nondurable materials n.e.c 1.14 132.8 128.5 129.9 123.6 135.0 135.7 134.8 131.8 134.5 135.5 134.1 52 Energy materials 8.48 125.0 123.0 118.7 122.2 127.5 127.9 127.0 126.0 128.0 128.5 128.6 112277..77 53 Primary energy 4.65 112.6 111.6 103.0 105.2 116.1 116.7 115.4 111.8 115.9 117.3 116.8 54 Converted fuel materials 3.82 140.2 136.9 137.7 142.8 141.4 141.6 141.3 143.4 142.7 142.1 142.9 Supplementary groups 55 Home goods and clothing 9.35 137.5 136.5 137.5 130.2 138.3 138.0 139.2 140.3 139.1 138.6 140.2 140.6 56 Energy, total 12.23 134.9 132.3 129.7 132.5 135.9 136.4 136.1 135.9 137.6 138.2 138.7 138.0 57 Products 3.76 157.2 153.2 154.5 155.8 154.6 155.6 156.7 158.3 159.3 160.2 161.1 58 Materials 8.48 125.0 123.0 118.7 122.2 127.5 127.9 127.0 126.0 128.0 128.5 128.6 127.7 For NOTE see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Output A49 2.13 Continued 1967 1977 1978 1978 1979 Grouping SIC pro- 1978 code por- avertion age» Nov. Dec. Jan. June July Aug. Sept. Oct.r Nov. Dec.P Jan.e Index (1967 = 100) MAJOR INDUSTRY 1 Mining and utilities., 12.05 141.4 135.5 133.9 137.4 142.5 142.6 142.5 142.1 144.1 144.0 144.2 143.4 2 Mining 6.36 124.1 118.8 113.4 115.0 128.0 127.1 126.0 124.1 127.6 127.3 127.0 124.0 3 Utilities 5.69 160.8 154.2 156.7 162.3 158.6 159.9 160.8 162.3 162.4 162.7 163.4 165.0 4 Electric 3.88 173.3 175.9 183.6 180.1 182.1 183.2 184.4 184.1 5 Manufacturing., 87.95 145.6 139.9 140.5 138.7 145.5 146.7 147.6 148.7 149.5 150.4 151.5 151.6 6 Nondurable.. 35.97 154.7 150.1 150.9 149.8 154.9 155.0 155.6 157.1 157.4 158.4 158.9 159.7 7 Durable 51.98 139.3 132.7 133.4 131.1 139.0 141.1 142.2 142.8 144.0 144.9 146.4 146.2 Mining 8 Metal mining 10 .51 121.0 84.8 104.3 121.4 121.1 117.0 117.9 115.6 122.1 125.3 123.9 9 Coal 11, 12 .69 115.8 140.6 74.6 54.8 136.4 131.7 124.9 114.7 144.0 145.1 146.8 117.2 10 Oil and gas extraction 13 4.40 124.5 117.8 118.4 121.1 127.1 126.8 126.2 124.9 124.5 123.8 123.2 123.0 11 Stone and earth minerals. 14 .75 131.0 127.2 126.5 130.0 130.7 131.3 131.6 133.8 134.0 132.9 133.6 Nondurable manufactures 12 Foods 20 8.75 142.8 139.4 140.4 139.3 141.8 142.9 144.0 144.4 143.2 144.2 145.1 13 Tobacco products 21 .67 117.5 120.6 113.4 122.7 120.8 118.6 120.6 119.0 121.5 14 Textile mill products... 22 2.68 140.0 141.6 143.7 137.1 140.4 141.0 139.5 142.2 142.1 144.1 144.1 15 Apparel products 23 3.31 125.1 125.8 118.6 126.8 124.5 127.2 130.9 130.6 16 Paper and products 26 3.21 144.5 137.8 138.6 139.9 148.0 140.5 141.9 142.3 145.8 145.3 i47.i 146.0 17 Printing and publishing 27 4.72 129.9 126.2 127.5 129.9 128.7 130.3 129.5 131.0 130.5 132.1 133.3 134.2 18 Chemicals and products... 28 7.74 190.6 183.1 183.0 184.4 191.1 192.3 192.2 194.2 195.9 197.8 196.9 19 Petroleum products 29 1.79 144.1 140.5 139.3 139.7 142.8 144.3 144.1 147.1 147.9 148.2 149.7 148.5 20 Rubber & plastic products. 30 2.24 254.2 238.5 240.1 238.7 255.5 259.1 261.1 263.1 264.1 262.2 261.6 21 Leather and products 31 .86 74.1 78.1 77.3 74.5 75.1 74.5 74.0 74.1 73.8 74.0 73.5 Durable manufactures 22 Ordnance, private & government. 19,91 3.64 73.7 74.1 73.8 72.3 74.7 75.2 75.2 74.3 73.9 73.6 74.2 74.6 23 Lumber and products 24 1.64 138.8 137.5 138.1 138.5 138.7 138.1 136.9 139.2 141.2 142.5 145.3 24 Furniture and fixtures 25 1.37 154.7 146.0 146.6 146.4 156.2 158.1 159.0 160.7 160.9 157.6 156.6 25 Clay, glass, stone products 32 2.74 159.2 152.8 152.1 152.2 159.8 158.8 159.5 160.9 162.1 166.3 168.0 26 Primary metals 33 6.57 119.1 111.2 111.0 107.4 117.5 123.0 126.0 127.9 128.6 128.9 131.8 128.9 27 Iron and steel 331, 2 4.21 113.2 104.3 103.8 99.5 114.5 119.0 120.9 123.2 123.8 123.8 126.7 28 Fabricated metal products. 34 5.93 142.6 135.8 136.4 136.9 142.3 144.0 145.8 146.3 146.0 146.9 148.1 i 48.7 29 Nonelectrical machinery... 35 9.15 155.6 149.7 151.7 150.1 154.6 156.1 157.3 158.7 160.3 160.6 161.4 162.5 30 Electrical machinery 36 8.05 154.2 146.0 147.3 144.0 154.1 157.9 156.9 158.3 157.9 159.1 161.8 162.9 31 Transportation equipment 37 9.27 130.5 122.0 122.2 116.2 130.4 132.1 133.4 132.8 137.0 139.3 139.3 137.1 32 Motor vehicles & parts 371 4.50 168.2 163.0 161.8 146.6 167.7 169.7 171.0 168.9 176.8 181.4 179.3 173.5 33 Aerospace & misc. trans, eq.. 372-9 4.77 94.9 83.3 84.9 87.6 95.0 96.5 98.3 98.9 99.6 99.7 U 1.7 103.0 34 Instruments 38 2.11 171.6 163.1 164.7 163.4 170.9 172.2 175.4 174.6 175.3 176.2 178.9 180.3 35 Miscellaneous mfrs 39 1.51 153.2 151.8 152.5 153.0 153.5 153.2 153.8 154.1 153.9 152.1 153.2 155.3 Gross value (billions of 1972 dollars, annual rates) MAJOR MARKET 36 Products, total. . 1507.4 609.3 591.3 594.7 582.0 608.9 610.3 613.3 613.6 621.3 625.9 628.9 630.6 37 F™in a•l products i390.9 469.1 457.3 458.7 445.1 468.9 469.6 472.2 471.8 478.8 482.2 483.8 484.6 38 Consumer goods. 1277.5 324.0 320.0 320.4 311.2 323.0 323.4 324.7 324.4 328.1 331.0 331.8 332.1 39 Equipment U13.4 145.1 137.3 138.2 133.9 146.0 146.4 147.5 147.7 150.6 151.2 151.8 152.3 40 Intermediate products. 1116.6 140.3 134.1 135.9 136.7 140.3 140.7 141.4 141.9 142.6 143.8 145.3 146.3 i 1972 dollars. shown separately. For description and historical data, see Industrial Production—1976 Revision (Board of Governors of the Federal Reserve NOTE. Published groupings include some series and subtotals not System: Washington, D.C.), Dec. 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A50 Domestic Nonfinancial Statistics • February 1979 2.14 HOUSING AND CONSTRUCTION Monthly figures are at seasonally adjusted annual rates except as noted. 1978 1976 1977 1978 Item June July Aug. Sept. Oct. Nov.' Dec. Private residential real estate activity (thousands of units) NEW UNITS 1 Permits authorized 1,296 18,133 1,658 1,821 1,632 1,563 1,731 1,719 1,724 1,680 2 1-family 894 12,265 1,078 1,123 1,035 1,020 1,092 1,127 1,114 1,158 3 2-or-more-family 402 5,861 581 698 597 543 639 592 610 522 4 Started 1,538 1,986 2,019 2,124 2,119 2,025 2,075 2,095 2,155 2,125 5 1-family 1,163 1,451 1,433 1,441 1,453 1,440 1,463 1,459 1,558 1,533 6 2-or-more-family 377 535 586 693 666 585 612 636 597 592 7 Under construction, end of period 1,147 1,442 n.a. 1,296 1,298 1,298 r1,305 '1,322 1,305 n.a. 8 1-family 655 829 n.a. 774 779 786 '782 '780 782 n.a. 9 2-or-more-family 492 613 n.a. 522 520 513 '542 '523 523 n.a. 10 Completed 1,362 1,652 n.a. 1,890 1,943 1,967 1,971 1,842 1,812 n.a. 11 1-family 1,026 1,254 n.a. 1,344 1,289 1,364 1,447 1,397 1,324 n.a. 12 2-or-more-family 336 398 n.a. 546 654 603 524 445 488 n.a. 13 Mobile homes shipped 246 277 276 263 232 283 272 300 312 308 Merchant builder activity in 1-family units: 14 Number sold 639 819 817 831 789 785 793 975 803 819 15 Number for sale, end of period 1. 433 407 423 418 418 419 420 411 416 420 Price (thous. of dollars)2 Median: 16 Units sold 44.2 48.9 55.9 56.7 54.8 56.1 '57.3 '58.3 58.7 61.1 17 Units for sale 41.6 48.2 n.a. n.a. n.a. Average: 13 Units sold 48.1 54.4 62.7 63.2 62.9 63.0 '64.4 '65.8 66.3 67.6 EXISTING UNITS (1-family) 19 Number sold 3,002 3,572 3,905 3,780 3,890 4,080 3,950 4,290 4,350 4,160 Price of units sold (thous. of dollars):2 20 Median 38.1 42.9 48.7 48.4 49.4 50.3 50.2 50.1 50.7 50.9 21 Average 42.2 47.9 55.1 55.1 56.5 57.5 57.7 57.3 57.4 58.1 Value of new construction 4 (millions of dollars) CONSTRUCTION 22 Total put in place 148,778 172,552 201,538 206,314 210,192 208,724 209,227 '209,815 212,788 215,037 23 Private 110,416 134,723 156,801 161,064 161,804 160,562 161,258 r161,909 164,875 168,001 24 Residential 60,519 80,957 92,658 95,357 95,888 95,011 94,249 '93,568 95,401 96,819 25 Nonresidential, total 49,897 53,766 64,143 65,707 65,916 65,551 67,009 68,341 69,474 71,182 Buildings: 26 Industrial 7,182 7,713 10,763 11,335 11,170 12,043 12,634 12,627 12,529 13,286 27 Commercial 12,757 14,789 18,308 19,246 19,463 18,835 18,926 19,410 20,294 20,777 28 Other 6,155 6,200 6,661 6,761 7,036 6,721 6,686 6,667 6,877 6,952 29 Public utilities and other 23,803 25,064 28,411 28,365 28,247 27,952 28,763 29,637 29,774 30,167 30 Public 38,312 37,828 44,737 45,249 48,388 43,162 47,970 '47,970 47,913 47,036 31 Military 1,521 1,517 2,181 1,358 1,493 1,520 1,615 '1,426 1,431 1,458 32 Highway 9,439 9,280 8,627 10,338 9,833 11,427 10,862 11,428 n.a. n.a. 33 Conservation and development. . 3,751 3,882 3,697 3,508 4,989 5,231 5,660 3,851 n.a. n.a. 34 Other 3 23,601 23,149 23,503 30,045 32,073 29,984 29,833 31,211 n.a. n.a. 1 Not at annual rates. NOTE. Census Bureau estimates for all series except (a) mobile homes 2 Not seasonally adjusted. which are private, domestic shipments as reported by the Manufactured 3 Beginning Jan. 1977 Highway imputations are included in Other. Housing Institute and seasonally adjusted by the Census Bureau, and 4 Value of new construction data in recent periods may not be strictly (b) sales and prices of existing units, which are published by the Nacomparable with data in prior periods due to changes by the Bureau of tional Association of Realtors. All back and current figures are availthe 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 PRODUCER PRICES Percentage changes based on seasonally adjusted data, except as noted. 12 months to— 3 months (at annual rate) to— 1 month to Index level Item 1978 1978 Dec. 1977 1978 1978 Dec. Dec. (1967 Mar. June Sept. Dec. Aug. Sept. Oct. Nov. Dec. = 100)2 Consumer prices-$ 1 All items 6.8 9.0 9.3 11.4 7.8 7.9 .6 .8 .8 .5 .6 202.9 2 Commodities 6.1 8.9 9.3 11.2 6.3 9.1 .4 .7 .7 .6 ..88 194.2 3 Food 8.0 11.8 16.4 20.4 3.0 7.8 .3 .5 .8 .3 ..88 219.4 4 Commodities less food 4.9 7.7 6.1 7.2 7.8 10.1 .5 .9 .7 .8 .9 181.3 5 Durable 4.7 9.2 8.7 9.0 8.3 11.1 .5 .9 .8 .8 1.0 181.2 6 Nondurable 4.9 5.7 3.1 5.5 7.3 7.0 .5 .8 .5 .6 .7 180.0 7 Services 7 9 9.3 9.1 11.8 10.3 5.7 .8 .8 .8 .4 .2 219.2 8 Rent 6.5 7.3 6.2 8.5 7.5 7.1 .5 .8 .6 .7 .5 169.5 9 Services less rent 8.1 9.6 9.6 12.2 10.8 5.4 .9 .9 .8 .3 .2 228.2 Other groupings: 10 All items less food 6.3 8.5 8.1 9.3 9.1 7.8 .7 .8 .8 .6 .6 198.6 11 All items less food and energy 6.4 8.5 8.0 9.9 8.3 7.7 .6 .7 .8 .6 .5 196.0 12 Homeownership 9.2 12.4 12.2 14.5 14.7 8.8 1.0 1.3 1.2 .7 .3 239.5 Producer prices, formerly Wholesale prices 4 13 Finished goods 6.6 9.1 8.7 10.3 7.4 10.1 .3 .8 .9 .8 .8 202.4 14 Consumer 6.4 9.5 9.5 10.6 7.5 10.8 .2 .9 1.0 .7 .9 200.4 15 Foods 6.6 11.9 16.8 11.4 4.9 15.3 -.4 1.5 1.9 .7 1.0 215.8 16 Excluding foods 6.1 8.3 5.3 10.5 8.8 8.4 .5 .5 .5 .7 .8 190.8 17 Capital equipment 7.2 8.0 7.1 9.1 7.0 8.8 .4 .5 .5 .9 .7 206.9 18 Materials 5.4 10.1 11.0 9.5 7.3 13.2 .5 .9 1.5 .8 .7 228.0 19 Intermediate1 6.4 8.2 8.1 7.2 6.9 10.8 .7 .6 1.0 ..99 ..77 222233..55 Crude: 20 Nonfood 6.8 15.5 10.7 14.9 16.9 19.6 .1 1.6 2.1 1.2 1.2 304.6 21 Food 1.4 18.3 25.1 26.6 2.8 21.0 .0 1.8 3.9 .9 224.7 1 Excludes intermediate materials for food manufacturing and manu- 3 Beginning Jan. 1978 figures for consumer prices are those for all urban factured animal feeds. consumers. 2 Not seasonally adjusted. 4 The Producer Price Index has been revised back to 1974. SOURCE. Bureau of Labor Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A52 Domestic Nonfinancial Statistics • February 1979 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates. 1977 1978 1976 1977 1978 P Account Q3 Q4 Ql Q2 Q3 Q4p Gross national product 1 1,700.1 1,887.2 2,106.6 1,916.8 1,958.1 1,992.0 2,087.5 2,136.1 2,210.8 By source: 2 Personal consumption expenditures 1,090.2 1,206.5 1,339.7 1,214.5 1,255.2 1,276.7 1,322.9 1,356.9 1,402.2 3 Durable goods 156.6 178.4 197.6 177.4 187.2 183.5 197.8 199.5 209.6 4 Nondurable goods 442.6 479.0 525.8 479.7 496.9 501.4 519.3 531.7 550.8 5 Services 491.0 549.2 616.3 557.5 571.1 591.8 605.8 625.8 641.8 6 Gross private domestic investment 243.0 297.8 344.5 309.7 313.5 322.7 345.4 350.1 359.9 7 Fixed investment 232.8 282.3 328.8 287.8 300.5 306.0 325.3 336.5 347.4 8 Nonresidential 164.6 190.4 222.0 193.5 200.3 205.6 220.1 227.5 235.0 9 Structures 57.3 63.9 77.5 65.4 67.4 68.5 76.6 80.9 84.0 10 Producers' durable equipment 107.3 126.5 144.5 128.1 132.8 137.1 143.5 146.6 151.0 11 Residential structures 68.2 91.9 106.8 94.3 100.2 100.3 105.3 109.0 112.5 12 Nonfarm 65.8 88.9 103.6 91.2 97.5 97.3 102.1 105.7 109.3 13 Change in business inventories 10.2 15.6 15.7 21.9 13.1 16.7 20.1 13.6 12.4 14 Nonfarm 12.2 15.0 16.7 22.0 10.4 16.9 22.1 14.6 13.1 15 Net exports of goods and services 7.4 -11.1 -11.8 -7.0 —23.2 -24.1 -5.5 -10.7 -6.9 16 Exports 163.2 175.5 205.2 180.8 172.1 181.7 205.4 210.1 223.5 17 Imports 155.7 186.6 217.0 187.8 195.2 205.8 210.9 220.8 230.4 18 Government purchases of goods and services. . 359.5 394.0 434.2 399.5 412.5 416.7 424.7 439.8 455.6 19 Federal 129.9 145.1 154.0 146.8 152.2 151.5 147.2 154.0 163.4 20 State and local 229.6 248.9 280.2 252.7 260.3 265.2 277.6 285.8 292.2 By major type of product: 2211 Final sales, total 1,689.9 1,871.6 2,090.9 1,894.9 1,945.0 1,975.3 2,067.4 2,122.5 2,198.4 22 Goods 760.3 832.6 917.5 844.7 859.6 861.8 912.2 927.3 968.6 23 Durable 304.6 341.3 376.3 346.5 347.4 351.2 375.8 380.1 398.0 24 Nondurable 455.7 491.3 541.2 498.2 512.2 510.6 536.4 547.2 570.6 25 Services 778.0 862.8 962.9 875.3 893.6 926.4 952.0 973.7 999.4 26 Structures 161.9 191.8 226.2 196.8 204.9 203.8 223.4 235.0 242.8 27 Change in business inventories 10.2 15.6 15.7 21.9 13.1 16.7 20.1 13.6 12.4 28 Durable goods 5.3 8.4 11.5 11.9 6.3 14 8 10.8 10.2 10.1 29 Nondurable goods 4.9 7.2 4.2 10.0 6.8 1.9 9.3 3.4 2.4 30 MEMO: Total GNP in 1972 dollars 1,271.0 1,332.7 1,385.1 1,343.9 1,354.5 1,354.2 1,382.6 1,391.4 1,412.2 National income 31 Total 1,359,2 1,515.3 1,703.6 1,537.6 1,576.9 1,603.1 1,688.1 1,728.4 32 Compensation of employees 1,036.8 1,153.4 1,301.2 1,165.8 1,199.7 1,241.0 1,287.8 1,317.1 33 Wages and salaries 890.1 983.6 1,100.7 993.6 1,021.2 1,050.8 1,090.2 1,113.4 34 Government and government enterprises .. 187.6 200.8 216.1 201.7 208.1 211.4 213.9 216.8 35 Other 702.5 782.9 884.6 791.9 813.1 839.3 876.3 896.6 36 Supplement to wages and salaries 146.7 169.8 200.5 172.2 117788..44 119900..22 119977..66 203.6 37 Employer contributions for social insurance 69.7 79.4 94.5 79.9 82.4 90.2 93.6 95.7 38 Other labor income 77.0 90.4 105.9 92.2 96.1 100.0 104.0 107.9 39 Proprietors' income1 88.6 99.8 112.9 97.2 107.3 105.0 110.1 114.5 40 Business and professional1 70.2 79.5 87.8 80.8 82.3 83.1 86.1 89.6 41 Farm1 18.4 20.3 25.1 16.5 25.1 21.9 24.0 25.0 42 Rental income of persons2 22.5 22.5 23.4 22.4 22.7 22.8 22.2 24.3 43 Corporate profits1 127.0 144.2 160.0 154.8 148.2 132.6 163.4 165.2 44 Profits before tax3 155.9 173.9 202.4 177.5 178.3 172.1 205.5 205.4 45 Inventory valuation adjustment -14.5 -14.8 -24.3 -7.7 -14.8 -23.5 -24.9 -20.9 46 Capital consumption adjustment -14.4 -14.9 -18.1 -15.0 -15.3 -16.1 -17.2 -19.3 47 Net interest 84.3 95.4 106.1 97.3 99.0 101.7 104.6 107.4 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. 1977 1978 11997766 1977 1978*' AAccccoouunntt Q3 Q4 Ql QQ22 QQ33 QQ44ff Personal income and saving 1 Total personal income 1,380.9 1,529.0 1,707.3 1,543.7 1,593.0 1,628.9 1,682.4 1 ,731.7 1,786.4 2 Wage and salary disbursements 890.1 983.6 1,100.7 993.6 1,021.2 1,050.8 1,090.2 1,113.2 1,148.5 3 Commodity-producing industries 307.5 343.7 390.1 348.3 357.1 365.9 387.0 396.4 410.8 4 Manufacturing......................... 237.5 266.3 299 J 269.3 277.3 286.9 296.1 302.0 313.6 216.4 239.1 268.7 241.2 247.5 257.0 266.4 271.6 279.9 6 Service industries 178.6 200.1 225.8 202.3 208.5 216.5 222.8 228.5 235.6 7 Government and government enterprises 187.6 200.8 216.1 201.7 208.1 211.4 213.9 216.7 222.2 8 Other labor income 77.0 90.4 105.9 92.2 96.1 100.0 104.0 107.9 111.8 88.6 99.8 112.9 97.2 107.3 105.0 110.1 114.5 121.9 10 Business and professional1 70.2 79.5 87.8 80.8 82.3 83.1 86.1 89.6 92.4 11 Farm1 18.4 20.3 25.1 16.5 25.1 21.9 24.0 25.0 29.5 12 Rental income of persons2 22.5 22.5 23.4 22.4 22.7 22.8 22.2 24.3 24.4 13 Dividends 37.9 43.7 49.3 44.1 46.3 47.0 48.1 50.1 51.9 14 Personal interest income 126.3 141.2 158.9 143.6 146.0 151.4 156.3 161.7 166.3 15 Transfer payments 193.9 208.8 226.0 211.9 215.9 219.2 220.6 230.4 233.6 16 Old-age survivors, disability, and health insurance benefits 92.9 105.0 117.3 108.5 110.1 112.1 111133..77 112211..11 112222..44 17 LESS: Personal contributions for social insurance 55.5 61.0 69.7 61.4 62.6 67.2 6699..22 7700..55 7722..00 18 EQUALS: Personal income 1,380.9 1,529.0 1,707.3 1,543.7 1,593.0 1,628.9 1,682.4 1 ,731.7 1,786.4 19 LESS: Personal tax and nontax payments.... 196.5 226.0 256.2 224.6 233.3 237.3 249.1 263.2 275.0 20 EQUALS: Disposable personal income 1,184.4 1,303.0 1,451.2 1,319.1 1,359.6 1,391.6 1,433.3 1 ,468.4 1,511.4 21 LESS: Personal outlays 1,116.3 1,236.1 1,374.4 1,244.8 1,285.9 1,309.2 1,357.0 1 ,392.5 1,439.2 22 EQUALS : Personal saving 68.0 66.9 76.7 74.3 73.7 82.4 76.3 76.0 72.3 MEMO ITEMS : Per capita (1972 dollars): 23 Gross national product 5,906 6,144 6,336 6,191 6,226 6,215 66,,333344 66,,336600 66,,444400 24 Personal consumption expenditures 3,808 3,954 4,077 3,953 4,030 4,009 4,060 4,092 4,150 4,136 4,271 4,418 4,293 4,365 4,370 4,399 4,428 4,474 26 Saving rate (per cent) 5.7 5.1 5.3 5.6 5.4 5.9 5.3 5.2 4.8 Gross saving 27 Gross private saving. 270.7 290.8 320.4 310.7 304.3 305.4 319.9 325.7 28 Personal saving 68.0 66.9 76.7 74.3 73.7 82.4 76.3 76.0 29 Undistributed corporate profits1 24.8 28.7 26.7 38.0 28.0 15.6 30.3 29.0 30 Corporate inventory valuation adjustment.... -14.5 -14.8 -24.3 -7.7 -14.8 -23.5 -24.9 -20.9 Capital consumption allowances: 31 Corporate 111.5 120.9 132.5 122.6 124.6 127.4 130.5 134.7 32 Noncorporate 66.3 74.3 84.4 75.9 77.9 79.9 82.8 86.1 33 Wage accruals less disbursements 34 Government surplus, or deficit (—), national income and product accounts -33.2 -18.6 -1.5 -25.2 -29.6 -21.1 6.2 .6 35 Federal -53.8 -48.1 -29.4 -56.4 -58.6 -52.6 -23.6 -22.8 36 State and local 20.7 29.6 27.8 31.2 29.0 31.5 29.8 23.4 37 Capital grants received by the United States, net 38 Investment 241.7 276.9 319.7 292.6 279.5 286.4 326.6 326.6 39 Gross private domestic. 243.0 297.8 344.5 309.7 313.5 322.1 345.4 350.1 40 Net foreign -1.2 -20.9 -24.8 -17.1 -34.1 -36.3 -18.9 -23.5 41 Statistical discrepancy. 4.2 4.7 7.1 4.8 2.2 .5 .4 1 With inventory valuation and capital consumption adjustments. SOURCE. Survey of Current Business (U.S. Dept. of Commerce). 2 With capital consumption adjustment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 International Statistics • February 1979 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data are seasonally adjusted except as noted.1 1977 1978 Item credits or debits 1975 1976 1977 Q3 Q4 Ql Q2 1 Merchandise exports 107,088 114,694 120,576 31,009 29,461 30,664 35,067 2 Merchandise imports 98,041 124,047 151,706 38,277 39,664 41,865 42,869 3 Merchandise trade balance2. 9,047 -9,353 -31,130 -7,268 -10,203 -11,201 -7,802 4 Military transactions, net -876 312 1,334 467 5 210 592 5 Investment income, net3 12,795 15,933 17,507 4,609 3,813 4,877 4,583 6 Other service transactions, net 2,095 2,469 1,705 583 482 538 842 7 Balance on goods and services3,4 23,060 9,361 -10,585 -1,609 -5,903 -5,576 -1,785 8 Remittances, pensions, and other transfers -1,721 -1,878 -1,932 -490 -473 -504 -536 9 U.S. government grants (excluding military). -2,894 -3,145 -2,776 -787 -591 -778 -781 10 Balance on current account3. 18,445 4,339 -15,292 -2,886 -6,967 -6,858 -3,102 11 Not seasonally adjusted3.. -5,196 -5,245 -6,382 -2,656 12 Change in U.S. government assets, other than official reserve assets, net (increase, —) -3,470 -4,213 -3,679 -1,098 -838 -896 -1,176 13 Change in U.S. official reserve assets (increase, —) -607 -2,530 -231 151 246 329 14 Gold -118 -60 15 Special Drawing Rights (SDRs) -66 -78 -121 -9 -29 -16 -104 16 Reserve position in International Monetary Fund (IMF).. -466 -2,212 -294 133 42 324 437 17 Foreign currencies -75 -240 302 27 47 -62 -4 18 Change in U.S. private assets abroad (increase, —)3. -35,368 -43,865 -30,740 -5,668 -13,862 -14,386 -5,287 19 Bank-reported claims -13,532 -21,368 -11,427 -1,779 -8,750 -6,270 -503 20 Nonbank-reported claims -7,557 -2,030 -1,700 1,389 -1,184 —2,222 267 21 Long-term -366 5 25 205 -279 -57 80 22 Short-term -991 -2,035 -1,725 1,184 -905 -2,165 187 23 U.S. purchase of foreign securities, net. -6,235 -8,852 -5,398 -2,165 -731 -949 -1,103 24 U.S. direct investments abroad, net3... -14,244 -11,614 -12,215 -3,113 -3,197 -4,945 -3,948 25 Change in foreign official assets in the United States (increase, +) 6,907 18,073 37,124 8,246 15,543 15,760 -5,685 26 U.S. Treasury securities 4,408 9,333 30,294 6,948 12,900 12,965 -5,728 27 Other U.S. government obligations 905 573 2,308 627 973 117 211 28 Other U.S. government liabilities5 1,647 4,993 1,644 332 390 804 -312 29 Other U.S. liabilities reported by U.S. banks -2,158 969 773 -163 909 1,456 -493 30 Other foreign official assets6 2,104 2,205 2,105 502 371 418 637 31 Change in foreign private assets in the United States (increase, +)3 8,643 18,897 13,746 6,005 4,522 2,336 6,090 32 U.S. bank-reported liabilities. 628 10,990 6,719 2,640 3,143 -314 1,836 33 U.S. nonbank-reported liabilities 319 -507 257 590 425 495 248 34 Long-term 406 -958 -620 18 -242 38 -68 35 Short-term -87 451 877 572 667 457 316 36 Foreign private purchases of U.S. Treasury securities, net 2,590 2,783 563 1,251 -299 881 847 37 Foreign purchases of other U.S. securities, net 2,503 1,284 2,869 513 803 462 1,308 38 Foreign direct investments in the United States, net3 2,603 4,347 3,338 1,012 450 812 1,852 39 Allocation of SDRs 40 Discrepancy 5,449 9,300 -927 -4,751 1,602 3,798 8.830 41 Owing to seasonal adjustments -2,229 2,276 160 -1 42 Statistical discrepancy in recorded data before seasonal adjustment 5,449 9,300 -927 -2,522 -674 3,638 8.831 MEMO ITEMS: Changes in official assets: 43 U.S. official reserve assets (increase, —) -607 -2,530 -231 151 246 329 44 Foreign official assets in the United States (increase, +). 5,259 13,080 35,480 7,914 15,153 14,956 -5,373 45 Changes in Organization of Petroleum Exporting Countries (OPEC) official assets in the Unites States (part of line 25 above) 7,092 9,581 6,733 ,438 1,024 1,963 -2,838 46 Transfers under military grant programs (excluded from lines 1, 4, and 9 above) 2,207 373 194 31 71 75 57 1 Seasonal factors are no longer calculated for lines 13 through 46. excludes certain military sales to Israel from exports and excludes U.S. 2 Data are on an international accounts (IA) basis. Differs from the government interest payments from imports. Census basis primarily because the IA basis includes imports into the 5 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. 6 Consists of investments in U.S. corporate stocks and in debt securi- 3 Includes reinvested earnings of incorporated affiliates. ties of private corporations and state and local governments. 4 Differs from the definition of "net exports of goods and services" in the national income and product (GNP) account. The GNP definition NOTE. Data are from Bureau of Economic Analysis, Survey of Current 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. 1978 IItteemm 11997766 11997777 11997788 June July Aug. Sept. Oct. Nov. Dec. 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments 115,156 r121,150 143,575 12,126 11,793 12,469 13,429 13,011 13,262 13,148 2 GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded warehouses 121,009 147,685 172,026 13,723 14,779 14,090 15,120 15,138 15,207 15,189 -5,853 r—26,535 28,451 -1,597 -2,987 -1,621 -1,691 -2,127 -1,946 -2,040 NOTE. Bureau of Census data reported on a free-alongside-ship and are reported separately in the "service account"). On the import (f.a.s.) value basis. Effective January 1978, major changes were made in side, the largest single adjustment is the addition of imports into the coverage, reporting, and compiling procedures. The international- Virgin Islands (largely oil for a refinery on St. Croix), which are not accounts-basis data adjust the Census basis data for reasons of coverage included in Census statistics. and timing. On the export side, the largest adjustments are: (a) the addition of exports to Canada not covered in Census statistics, and (b) the exclusion SOURCE. FT 900 "Summary of U.S. Export and Import Merchandise of military exports (which are combined with other military transactions Trade" (U.S. Dept. of Commerce, Bureau of the Census). 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period 1978 1979 TTyyppee 11997755 11997766 11997777 July Aug. Sept. Oct. Nov. Dec. Jan .P 1 Total 16,226 18,747 19,312 18,832 18,783 18,850 18,935 17,967 3 18,650 3 20,468 2 Gold stock, including Exchange Stabilization Fund1 11,599 11,598 11,719 11,693 11,679 11,668 11,655 11,642 11,671 11,592 3 Special Drawing Rights2 2,335 2,395 2,629 2,860 2,885 2,942 3,097 1,522 31,558 32,661 4 Reserve position in International Monetary Fund 2,212 4,434 4,946 4,177 4,196 4,214 4,147 1,099 31,047 3 1,017 5 Convertible foreign currencies4 80 320 18 102 23 26 36 3,704 4,374 5,198 1 Gold held under earmark at F.R. Banks for foreign and international 3 Beginning July 1974, the IMF adopted a technique for valuing the accounts is not included in the gold stock of the United States; see table SDR based on a weighted average of exchange rates for the currencies 3.24. of 16 member countries. The U.S. SDR holdings and reserve position in 2 Includes allocations by the International Monetary Fund (IMF) of the IMF also are valued on this basis beginning July 1974. SDR's as follows: $867 million on Jan. 1, 1970; $717 million on Jan. 1, 4 Beginning November 1978, valued at current market exchange rates. 1971; and $710 million on Jan. 1, 1972; plus net transactions in SDRs. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A56 International Statistics • February 1979 3.13 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data Millions of dollars, end of period 1978 Asset account 1975 1976 1977 May2 June July Aug. Sept. Oct. All foreign countries 1 Total, all currencies 176,493 219,420 258,897 259,442 271,696 269,542 '274,937 287,369 292,304 295,984 2 Claims on United States 6,743 7,889 11,623 8,727 10,891 9,254 r10,026 14,976 12,172 13,375 3 Parent bank 3,665 4,323 7,806 4.863 6,750 5,096 5,820 10,693 7,879 9,017 4 Other 3,078 3,566 3,817 3.864 4,141 4,158 '4,206 '4,283 4,293 4,358 5 Claims on foreigners 163,391 204,486 238,848 241,774 251,783 250,700 254,779 262,063 269,110 271,446 6 Other branches of parent bank 34,508 45,955 55,772 52,713 55,357 55,236 58,746 63,493 67,648 68,803 7 Banks 69,206 83,765 91,883 91,912 96,638 94,659 '92,803 95,222 98,195 101,100 8 Public borrowers1 5,792 10,613 14,634 21,139 22,654 r23,288 '23,362 '23,896 23,937 22,696 9 Nonbank foreigners 53,886 64,153 76,560 76,010 77,134 '77,517 79,868 '79,452 79,330 78,847 10 Other assets 6,359 7,045 8,425 8,941 9,022 9,588 10,132 10,330 11,022 11,163 11 Total payable in U.S. dollars 132,901 167,695 193,764 192,466 202,792 198,205 '200,787 212,063 210,938 218,266 12 Claims on United States 6,408 7,595 11,049 8,035 10,107 8,473 r9,221 14,168 11,331 12,471 13 Parent bank 3,628 4,264 7,692 A,1X2 6,580 4,906 '5,630 10,535 7,688 8,840 14 Other 2,780 3,332 3,357 3,323 3,527 3,567 3,591 3,633 3,643 3,631 15 Claims on foreigners 123,496 156,896 178,896 180,331 188,590 185,425 187,038 193,457 194,877 200,788 16 Other branches of parent bank 28,478 37,909 44,256 41,209 43,544 43,447 46,326 50,880 52,887 54,986 17 Banks 55,319 66,331 70,786 70,124 74,842 71,592 '69,552 71,892 72,641 76,429 18 Public borrowers1 4,864 9,022 12,632 18,275 19,674 '20,291 '20,263 '20,505 20,290 19,367 19 Nonbank foreigners 34,835 43,634 51,222 50,723 50,530 r50,095 50,897 '50,180 49,059 50,006 20 Other assets 2,997 3,204 3,820 4,100 4,095 4,307 4,528 4,438 4,730 5,007 United Kingdom 21 Total, all currencies 74,883 81,466 90,933 89,645 93,538 92,989 93,341 99,084 101,887 102,032 22 Claims on United States 2,392 3,354 4,341 2,333 3,142 2,615 2,626 2,940 3,119 3,706 23 Parent bank 1,449 2,376 3,518 1,476 2,279 1,515 1,597 2,014 2,230 2,119 24 Other 943 978 823 857 863 1,100 1,029 926 889 921 25 Claims on foreigners 70,331 75,859 84.016 84,700 87,808 87,479 87,769 93,364 95,774 95,220 26 Other branches of parent bank, 17,557 19,753 22.017 19,550 19,944 20,438 21,661 24,691 26,422 26,077 27 Banks 35,904 38,089 39,899 40,807 43,044 42,462 '40,350 42,677 44,020 44,287 2 2 9 8 N Pu o b n l b ic a n b k o r f r o o r w ei e g r n s e 1 rs 15,9 8 9 8 0 1 1 1 6 , , 2 7 7 4 4 3 1 2 9 , , 2 8 0 9 6 5 2 4 0 , , 1 1 5 9 0 3 2 4 0 , ,2 5 6 5 1 9 '1 '4 9 , , 6 9 3 4 7 2 2 '4 1 , , 5 1 8 7 3 5 x ' 2 ' 1 4 , , 4 5 4 4 7 9 2 4 0 , , 6 6 9 3 5 7 2 4 0 , , 2 6 3 1 7 9 30 Other assets 2,159 2,253 2,576 2,612 2,588 2,895 2,946 2,ISO 2,994 3,106 31 Total payable in U.S. dollars 57,361 61,587 66,635 63,565 67,016 65,452 64,457 70,008 70,209 71,761 32 Claims on United States 2,273 3,275 4,100 2,163 2,870 2,321 2,337 2,598 2,877 3,475 33 Parent bank 1,445 2,374 3,431 1,452 2,178 1,386 1,483 1,895 2,187 2,727 34 Other 828 902 669 711 692 935 854 703 690 748 35 Claims on foreigners 54,121 57,488 61,408 60,277 63,043 61,938 60,907 66,242 66,132 67,031 36 Other branches of parent bank. 15,645 17,249 18,947 16,406 17,025 17,438 18,305 20,934 21,377 21,491 37 Banks 28,224 28,983 28,530 28,324 30,686 29,455 '27,268 29,859 29,680 30,480 38 Public borrowers1 648 846 1,669 3,254 3,525 '3,660 '3,544 '3,471 3,586 3,227 39 Nonbank foreigners 9,604 10,410 12,263 12,293 11,807 '11,385 11,790 '11,978 11,489 11,833 40 Other assets 967 824 1,126 1,125 1,103 1,193 1,213 1,168 1,200 1,255 Bahamas and Caymans 41 Total, all currencies 45,203 66,774 79,052 82,083 84,692 82,145 85,654 88,755 86,290 89,560 42 Claims on United States. 3,229 3,508 5,782 5,237 6,441 5,132 5,620 10,053 7,250 7,461 43 Parent bank.. 1,477 1,141 3,051 2,502 3,449 2,381 2,751 7,090 4,255 4,399 44 Other 1,752 2,367 2,731 2,735 2,992 2,751 2,869 2,963 2,995 3,062 45 Claims on foreigners 41,040 62,048 71,671 74,846 76,282 74,988 77,949 76,651 76,863 79,890 46 Other branches of parent bank. 5,411 8,144 11,120 10,580 10,803 10,292 12,134 12,348 12,618 13,433 47 Banks 16,298 25,354 27,939 29,045 30,307 29,302 29,749 29,All 30,314 33,025 48 Public borrowers1 3,576 7,105 9,109 11,424 12,394 12,599 12,461 12,362 12,092 11,534 49 Nonbank foreigners 15,756 21,445 23,503 23,797 22,IIS 22,795 23,605 22,469 21,839 21,898 50 Other assets 933 1,217 1,599 2,000 1,969 2,025 2,085 2,051 2,177 2,209 51 Total payable in U.S. dollars. 1 41,887 62,705 73,987 76,660 79,277 76,494 79,701 83,007 80,222 83,568 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Overseas Branches A57 3.13 Continued 1978 Liability account 1975 1976 1977 May2 June July Aug. Sept. Oct. NOV.P All foreign countries 52 Total, all currencies 176,493 219,420 258,897 259,442 271,696 269,542 r274,937 287,369 292,304 295,984 53 To United States 20,221 32,719 44,154 49,907 50,534 51,583 r52,437 r49,325 51,509 56,994 54 Parent bank 12,165 19,773 24,542 28,422 25,199 27,722 r28,923 24,590 27,619 31,793 5 5 5 6 N O o th n e b r a b n a k n s ks in United States. } 8,057 12,946 19,613 X ( 1 9 2 , , 0 48 0 2 3 1 1 0 4 , , 3 9 7 6 1 4 1 8 5 , , 6 2 0 5 8 3 1 7 5 , , 6 8 5 5 9 5 r1 1 4 0 , , 6 0 7 6 1 4 1 8 5 , , 3 5 6 2 5 5 1 9 6 , , 0 1 8 1 9 2 57 To foreigners 149,815 179,954 206,579 202,232 213,670 209,810 213,978 r228,733 231,115 229,266 58 Other branches of parent bank 34,111 44,370 53,244 50,368 53,547 53,788 56,955 61,599 65,104 65,802 59 Banks 72,259 83,880 94,140 87,567 93.413 88,364 89,234 r97,629 95,955 94,094 60 Official institutions 22,773 25,829 28,110 29,776 31.414 31,831 31,455 33,077 32,237 31,213 61 Nonbank foreigners 20,672 25,877 31,085 34,521 35,296 35,827 36,334 r36,428 37,819 38,157 62 Other liabilities 6,456 6,747 8,163 7,303 7,492 8,149 8,522 9,311 9,680 9,724 63 Total payable in U.S. dollars 135,907 173,071 198,572 196,746 207,117 202,407 r204,946 215,496 215,517 222,887 64 To United States 19,503 31,932 42,881 48,278 48,820 49,668 r50,329 r 47,171 49,276 55,083 65 Parent bank 11,939 19,559 24,213 27,787 24,477 26,951 r28,031 23,640 26,684 30,964 6 6 6 7 N O o th n e b r a b n a k n s ks in United States. } 7,564 12,373 18,669 X ( 11 8 , , 7 7 8 0 7 4 1 14 0 , , 2 0 6 7 5 8 1 8 4 , , 2 4 8 3 6 1 1 7 5 , , 2 0 8 1 6 2 1 9 3 , , 7 80 2 7 4 1 8 4 , , 0 5 1 8 1 1 1 8 5 , , 8 30 1 1 8 68 To foreigners 112,879 137,612 151,363 144,758 154,513 148,630 150,474 r163,626 161,505 162,828 69 Other branches of parent bank 28,217 37,098 43,268 40,099 42,682 42,852 45,620 49,978 52,052 53,370 70 Banks 51,583 60,619 64,872 57,871 62,434 56,273 55,285 r63,271 58,911 58,831 71 Official institutions 19,982 22,878 23,972 25,124 26,587 26,843 26,178 27,358 26,332 25,442 72 Nonbank foreigners 13,097 17,017 19,251 21,664 22,810 22,662 23,391 r23,019 24,210 25,185 73 Other liabilities 3,526 3,527 4,328 3,710 3,784 4,109 4,143 4,699 4,736 4,976 United Kingdom 74 Total, all currencies 74,883 81,466 90,933 89,645 93,538 92,989 93,341 99,084 101,887 102,032 75 To United States 5,646 5,997 7,753 6,758 8,174 8,011 6,978 8,033 8,347 9,053 76 Parent bank 2,122 1,198 1,451 1,636 1,822 1,959 1,905 1,872 2,176 2,367 7 7 7 8 N O o th n e b r a b n a k n s ks in United States. } 3,523 4,798 6,302 X ( 2 2 , , 7 3 7 4 6 6 3 3 , , 0 2 7 7 9 3 2 3 , , 9 0 8 6 7 5 2 2 , , 7 2 8 9 3 0 3 3, , 0 1 1 5 1 0 2 3 , , 9 2 4 2 9 2 3 3 , , 2 4 3 5 4 2 79 To foreigners 67,240 73,228 80,736 80.108 82,703 81,847 82,991 87,678 89,942 89,347 80 Other branches of parent bank 6,494 7,092 9,376 9,009 9,700 10,098 11,708 12,006 12,269 13,153 81 Banks 32,964 36,259 37,893 35,980 36,856 34,662 35,293 37,677 39,276 38.167 82 Official institutions 16,553 17,273 18,318 19,087 20,074 20,863 19,863 21,493 21,193 20,182 83 Nonbank foreigners 11,229 12,605 15,149 16,032 16,073 16,224 16,127 16,502 17,204 17,845 84 Other liabilities 1,997 2,241 2,445 2,779 2,661 3,131 3,372 3,373 3,598 3,632 85 Total payable in U.S. dollars 57,820 63,174 67,573 64,025 67,936 65,671 64,926 70,227 71,158 72,812 86 To United States 5,415 5,849 7,480 6,446 7,852 7,652 6,606 7,650 7,985 8,666 87 Parent bank 2,083 1,182 1,416 1,609 1,794 1,926 1,852 1,805 2,116 2,321 8 8 8 9 O No th n e b r a b n a k n s ks in United States. [ 3,332 4,667 6,064 ( ( 2 2 , ,2 5 8 5 1 6 2 3 , , 8 1 8 7 2 6 2 2 , , 9 8 0 2 4 2 2 2 , ,5 2 4 0 5 9 2 3 , , 7 0 5 9 3 2 2 2 , , 9 9 6 0 7 2 3 3 , ,1 1 6 7 7 8 90 To foreigners 51,447 56,372 58,977 56,274 58,856 56,636 57,015 61,231 61,765 62,631 91 Other branches of parent bank 5,442 5,874 7,505 6,696 7,259 7,696 9,163 9,317 9,301 10,302 92 Banks 23,330 25,527 25,608 22,554 23,472 20,527 20,601 22,936 23,259 23,044 93 Official institutions 14,498 15,423 15,482 15,908 16,866 17,397 16,113 17,659 17,106 16,317 94 Nonbank foreigners 8,176 9,547 10,382 11,116 11,259 11,016 11,138 11,319 12,099 12,968 95 Other liabilities 959 953 1,116 1,305 1,228 1,383 1,305 1,346 1,408 1,515 Bahamas and Caymans 96 Total, all currencies 45,203 66,774 79,052 82,083 84,692 82,145 85,654 88,755 86,290 89,560 97 To United States 11,147 22,721 32,176 37,350 35,185 37,041 39,532 r34,378 35,679 40,561 98 Parent bank 7,628 16,161 20,956 23,255 19,078 21,755 23,187 18,410 20,179 24,013 1 9 0 9 0 O No th n e b r a b n a k n s ks in United States } 3,520 6,560 11,220 X ( 8 5 , , 4 6 7 2 0 5 1 5 0 , , 5 5 1 9 4 3 1 4 0 , , 5 6 8 9 7 9 1 4 1 , , 5 8 0 3 9 6 r10 5 , , 4 5 5 1 7 1 1 4 1 , , 4 0 1 8 8 2 1 4 1 , , 8 6 5 9 7 1 101 To foreigners 32,949 42,899 45,292 43,394 48,088 43,649 44,597 r52,574 48,955 47,317 102 Other branches of parent bank. 10,569 13,801 12,816 11,250 11,657 11,165 11,436 14,762 15,635 14,715 103 Banks 16,825 21,760 24,717 21,452 25,752 21,951 21,884 '27,372 22,471 21,998 104 Official institutions 3,308 3,573 3,000 4,419 4,583 4,221 4,598 4,468 4,440 4,340 105 Nonbank foreigners 2,248 3,765 4,759 6,273 6,096 6,312 6,679 '5,972 6,409 6,264 106 Other liabilities 1,106 1,154 1,584 1,339 1,419 1,455 1,525 rl,803 1,656 1,682 107 Total payable in U.S. dollars 42,197 63,417 74,463 78,254 80,650 78,131 81,314 84,317 81,323 84,878 1 In May 1978 a broader category of claims on foreign public borrowers, 2 In May 1978 the exemption level for branches required to report including corporations that are majority owned by foreign governments, was increased, which reduced the number of reporting branches. replaced the previous, more narrowly defined claims on foreign official institutions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 International Statistics • February 1979 3.14 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1978 IItteemm 11997755 11997766 11997777 June July Aug. Sept. Oct. NOV.P DecJ] A. By type 1111 TTTToooottttaaaallll iiii 82,572 95,634 131,090 140,571 144,138 146,084 145,210 152,460 156,555 162,391 2222 LLLLiiiiaaaabbbbiiiilllliiiittttiiiieeeessss rrrreeeeppppoooorrrrtttteeeedddd bbbbyyyy bbbbaaaannnnkkkkssss iiiinnnn tttthhhheeee UUUUnnnniiiitttteeeedddd SSSSttttaaaatttteeeessss2222 16,262 17,231 18,003 18,808 19,445 20,049 19,752 22,300 21,694 22.957 3333 UUUU....SSSS.... TTTTrrrreeeeaaaassssuuuurrrryyyy bbbbiiiillllllllssss aaaannnndddd cccceeeerrrrttttiiiiffffiiiiccccaaaatttteeeessss3333 34,199 37,725 47,820 55,594 56,842 56,299 55,014 57,976 62,943 67,906 UUUU....SSSS.... TTTTrrrreeeeaaaassssuuuurrrryyyy bbbboooonnnnddddssss aaaannnndddd nnnnooootttteeeessss:::: 4444 MMMMaaaarrrrkkkkeeeettttaaaabbbblllleeee 6,671 11,788 32,157 32,836 34,149 34,860 35,564 36,141 36,209 35.838 5555 NNNNoooonnnnmmmmaaaarrrrkkkkeeeettttaaaabbbblllleeee4444 19,976 20,648 20,443 19,284 19,214 20,375 20,304 21,426 20.993 20,970 6666 UUUU....SSSS.... sssseeeeccccuuuurrrriiiittttiiiieeeessss ooootttthhhheeeerrrr tttthhhhaaaannnn UUUU....SSSS.... TTTTrrrreeeeaaaassssuuuurrrryyyy sssseeeeccccuuuurrrriiiittttiiiieeeessss5555 5,464 8,242 12,667 14,049 14,488 14,501 14,576 14,617 14,716 14,720 B. By area 7777 TTTToooottttaaaallll 82,572 95,634 131,090 140,571 144,138 146,084 145,210 152,460 156,555 162,391 8888 WWWWeeeesssstttteeeerrrrnnnn EEEEuuuurrrrooooppppeeee1111 45,701 45,882 70,748 74,455 75,739 79,723 80,267 85,303 88,697 93,122 9999 CCCCaaaannnnaaaaddddaaaa 3,132 3,406 2,334 2,593 2,490 2,071 1,497 2,619 2,446 2,486 11110000 LLLLaaaattttiiiinnnn AAAAmmmmeeeerrrriiiiccccaaaa aaaannnndddd CCCCaaaarrrriiiibbbbbbbbeeeeaaaannnn 4,461 4,926 4,649 4,668 4,629 4,621 3,898 4,611 4,496 4,993 11111111 AAAAssssiiiiaaaa 24,411 37,767 50,693 56,199 58,081 56,848 56,808 57.011 57,830 58,613 11112222 AAAAffffrrrriiiiccccaaaa 2,983 1,893 1,742 1,689 2,220 2,036 2,006 2,184 2,301 2,443 11113333 OOOOtttthhhheeeerrrr ccccoooouuuunnnnttttrrrriiiieeeessss6666 1,884 1,760 924 967 979 785 734 732 785 734 1 Includes the Bank for International Settlements. 5 Debt securities of U.S. govt, corporations and federally sponsored 2 Principally demand deposits, time deposits, bankers acceptances, agencies, and U.S. corporate stocks and bonds. commercial paper, negotiable time certificates of deposit, and borrowings 6 Includes countries in Oceania and Eastern Europe. under repurchase agreements. 3 Includes nonmarketable certificates of indebtedness (including those NOTE. Based on Treasury Dept. data and on data reported to the payable in foreign currencies through 1974) and Treasury bills issued to Treasury Dept. by banks (including Federal Reserve Banks) and securities official institutions of foreign countries. dealers in the United States. 4 Excludes notes issued to foreign official nonreserve agencies. Includes For a description of the changes in the International Statistics tables, bonds and notes payable in foreign currencies. see July 1978 BULLETIN, p. 612. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A59 3.15 LIABILITIES TO FOREIGNERS Reported by Banks in the United States Payable in U.S. dollars Millions of dollars, end of period 1978 Item 1975 1976 1977 June July Aug. Sept. Oct. Nov.f Dec.f A. By holder and type of liability All foreigners. 95,590 110,657 126,168 135,926 137,293 140,532 144,084 150,584 158,421 166,242 2 Banks' own liabilities. 60,671 61,429 63,931 68,488 71,102 75,166 77,773 3 Demand deposits... 13,564 16,803 18,996 17,189 17,953 16,104 17,204 17,557 18,264 19,202 4 Time deposits1 10,267 11,347 11,521 11,635 11,921 12,634 12,503 12,279 12,514 12,287 5 Other 2 6,477 6,876 7,238 6,697 9,756 8,645 9,766 6 Own foreign offices3 25,369 24,679 27,955 32,085 31,511 35,744 36,518 7 Banks' custody liabilities4 75,255 75,864 76,601 75,596 79,482 83,255 88,469 8 U.S. Treasury bills and certificates 5 37,414 40,744 48,906 57,126 57,629 57,264 56,665 59,077 63,434 68,434 9 Other negotiable and readily transferable instruments6 15,506 15,512 16,691 16,057 17,619 17,424 17,501 10 Other 2,623 2,722 2,646 2,874 2,786 2,397 2,535 11 Nonmonetary international and regional organizations7 5,699 5,714 3,274 2,942 2,678 2,823 3,406 2,929 2,225 2,617 12 Banks' own liabilities. 480 1,017 808 767 336 417 916 13 Demand deposits... 139 290 231 265 257 142 144 133 153 330 14 Time deposits1 148 205 139 119 116 97 99 116 102 94 15 Other 2 97 644 569 523 87 161 492 16 Banks' custody liabilities4 2,462 1,662 2,014 2,639 2,593 1,809 1,701 17 U.S. Treasury bills and certificates 2,554 2,701 706 922 228 368 1,036 403 183 201 18 Other negotiable and readily transferable instruments6 1,537 1,432 1,645 1,603 2,189 1,625 1,499 19 Other 3 1 1 1 1 1 1 20 Official institutions8 50,461 54,956 65,822 74,402 76,286 76,348 74,766 80,267 84,329 90,608 21 Banks' own liabilities. 8,453 9,422 9,085 9,455 11,474 10,820 11,683 22 Demand deposits... 2,644 3,394 3,528 2,611 3,473 2,643 3,307 3,046 3,414 3,388 23 Time deposits1 3,423 2,321 1,797 1,981 2,277 2,595 2,563 2,399 2,345 2,331 24 Other2 3,862 3,673 3,848 3,585 6,030 5,060 5,963 25 Banks' custody liabilities4 65,949 66.864 67,263 65,311 68,793 73,510 78,925 26 U.S. Treasury bills and certificates 5 34,199 37,725 47,820 55,594 56,842 56,299 55,014 57,967 62,635 67,650 27 Other negotiable and readily transferable instruments6 9,857 9,498 10,326 9,703 10,616 10,768 11,105 28 Other 498 524 638 594 210 107 170 29 Banks 9. 29,330 37,174 42,335 43,363 42,921 45.532 50,410 51,379 55,241 56,962 30 Banks' own liabilities 38,824 38,358 41,028 45,640 46,425 50,440 52,142 31 Unaffiliated foreign banks. 13,454 13,680 13,073 13.555 14,914 14,696 15,624 32 Demand deposits 7,534 9,104 10,933 10,164 10,240 9,229 9,713 10,156 10,068 11,238 33 Time deposits1 1,873 2,297 2,040 1,255 1,321 1,390 1,618 1,552 1,735 1,481 34 Other2 2,035 2,110 2,454 2,223 3,206 2,893 2,904 35 Own foreign offices3 25,369 24,679 27,955 32,085 31,511 35,744 36,518 36 Banks' custody liabilities4 4,540 4,562 4,504 4,771 4,955 4,801 4,819 37 U.S. Treasury bills and certificates 335 119 141 300 269 296 307 381 371 300 38 Other negotiable and readily transferable instruments6 2,355 2,416 2.381 2,534 2,447 2,528 2,417 39 Other 1,885 1,877 1,828 1,930 2,126 1,902 2,103 40 Other foreigners. 10,100 12,814 14,736 15,218 15,407 15,829 15,502 16,008 16,625 16,056 41 Banks' own liabilities. 12,914 12,631 13,009 12,627 12,867 13,490 13,031 42 Demand deposits... 3,248 4,015 4,304 4,149 3,983 4,090 4,039 4,222 4,628 4,246 43 Time deposits1 4,823 6,524 7,546 8,281 8,208 8,552 8,222 8,213 8,331 8,379 44 Other2 484 441 368 365 432 531 406 45 Banks' custody liabilities4 2,304 2,776 2,819 2,875 3,141 3,135 3,024 46 U.S. Treasury bills and certificates 325 240 310 290 301 308 326 245 282 47 Other negotiable and readily transferable instruments6 1,757 2,165 2,339 2,218 2,367 2,503 2,480 48 Other 237 320 179 349 448 387 262 49 MEMO: Negotiable time certificates of deposit held in custody for foreigners 9,428 9,385 9,964 9,822 10,977 10,803 10,895 1 Excludes negotiable time certificates of deposit, which are included 6 Principally bankers acceptances, commercial paper, and negotiable in "Other negotiable and readily transferable instruments." time certificates of deposit. 2 Includes borrowings under repurchase agreements. 7 Principally the International Bank for Reconstruction and Develop- 3 U.S. banks: includes amounts due to own foreign branches and ment, and the Inter-American and Asian Development Banks. foreign subsidiaries consolidated in "Consolidated Report of Condition" 8 Foreign central banks and foreign central governments and the filed with bank regulatory agencies. Agencies, branches, and majority- Bank for International Settlements. owned subsidiaries of foreign banks: principally amounts due to head 9 Excludes central banks, which are included in "Official institutions." office or parent foreign bank, and foreign branches, agencies or whollyowned subsidiaries of head office or parent foreign bank. NOTE. Data for time deposits prior to April 1978 represent short-term 4 Financial claims on residents of the United States, other than long- only. term securities, held by or through reporting banks. For a description of the changes in the International Statistics tables, 5 Includes nonmarketable certificates of indebtedness (including those see July 1978 BULLETIN, p. 612. payable in foreign currencies through 1974) and Treasury bills issued to official institutions of foreign countries. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A60 International Statistics • February 1979 3.15 Continued 1978 Item 1975 1976 1977 June July Aug. Sept. Oct. Nov.*3 Dec.f B. By area and country 1 Total 95,590 110,657 126,168 135,926 137,293 140,532 144,084 150,584 158,421 2 Foreign countries. 89,891 104,943 122,893 132,983 134,615 137,709 140,678 147,655 156,196 3 Europe., 44,072 47,076 60,295 64,302 64,662 67,339 69,099 73,408 78,418 4 Austria 759 346 318 351 312 424 431 473 514 5 Belgium-Luxembourg.. 2,893 2,187 2,531 2,756 2,211 2,174 2,368 2,464 2,471 6 Denmark 329 356 770 1,335 1,542 1,593 1,673 1,734 1,827 7 Finland 391 416 323 352 407 416 415 424 388 8 France 7,726 4.876 5,269 6,550 7,353 7,989 8,060 8,421 8,817 9 Germany 4,543 6,241 7,239 10,029 9,727 10,766 11,206 13,345 15,652 10 Greece 284 403 603 597 646 826 865 887 907 11 Italy 1,059 3,182 6,857 6,869 7,036 8,055 7,394 7,346 7,761 12 Netherlands 3,407 3,003 2,869 3,118 3,078 3,240 2,756 2,523 2,518 13 Norway 994 782 944 1,869 1,737 1.516 1,208 1,210 1,102 14 Portugal 193 239 273 191 227 324 521 386 379 15 Spain 423 559 619 688 709 752 765 702 885 16 Sweden 2,277 1,692 2,712 3.385 3,340 3,355 3,341 3,187 3,216 17 Switzerland 8,476 9,460 12,343 12,415 11,888 12,102 13,077 14,314 15,810 18 Turkey 118 166 130 110 147 137 226 164 163 19 United Kingdom 6,867 10,018 14,125 11,471 11,770 10,956 11,802 12,438 12,826 20 Yugoslavia 126 189 232 229 192 149 167 158 190 21 Other Western Europe1 2,970 2,673 1,804 1,666 1,935 2,311 2,497 2,887 2,719 22 U.S.S.R 40 51 98 66 55 46 65 82 73 23 Other Eastern Europe2, 197 236 236 255 222 210 262 262 198 24 Canada. 2,919 4,659 4,607 5,816 5,623 5,890 5,122 7,418 8,001 25 Latin America and Caribbean 15,028 19,132 23,670 25,425 24,831 27,259 29,284 28,470 31,111 26 Argentina 1,146 1,534 1,416 1,692 1,550 1,453 1,393 1,650 1,504 27 Bahamas 1,874 2,770 3,596 3,954 3,629 4,601 7,249 4,880 6,309 28 Bermuda 184 218 321 396 383 372 409 387 425 29 Brazil 1,219 1,438 1,396 1,220 1,295 1,382 1,350 1,441 1,234 30 British West Indies 1,311 1.877 3,998 A,169 4,009 5,474 5,380 5,919 6,692 31 Chile 319 337 360 316 380 346 351 333 341 32 Colombia 417 1,021 1,221 1,424 1,429 1,486 1,431 1,483 1,612 33 Cuba 6 6 6 7 9 10 7 7 7 3 3 3 5 6 4 J E G a c u m u a a a t d e ic o m a r a 3 la3 120 320 330 4 3 4 6 2 8 6 5 4 3 1 7 7 5 5 8 4 3 1 4 5 9 7 9 4 3 0 7 4 5 8 7 3 3 5 6 6 7 8 9 3 3 5 4 4 7 3 8 3 3 7 8 N M e e t x h i e c r o l ands Antilles4 2,0 1 7 2 0 9 2,8 1 7 5 0 8 2,8 1 7 9 6 6 2,7 3 7 2 6 0 2,9 4 2 3 1 5 3,1 2 7 8 1 8 3,1 3 1 1 2 7 3,1 3 0 5 1 2 3,4 3 1 6 3 8 39 Panama 1,115 1,167 2,331 2.386 2,639 2,628 2,741 2,396 2,808 40 Peru 243 257 287 282 309 311 321 323 337 41 Uruguay 172 245 243 220 218 185 197 210 211 42 Venezuela 3,309 3,118 2,929 3,157 3,229 3,208 2,560 3,696 3,550 43 Other Latin America and Caribbean. 1,393 1,797 2,167 1,606 1,530 1.517 1,637 1,496 1,553 44 Asia. 22,384 29,766 30,488 33,665 35,171 33,463 33,438 34,630 34,843 45 China (Mainland) 123 48 53 53 47 44 46 49 51 46 China (Taiwan) 1,025 990 1,013 1,053 1,195 1,262 1,280 1,319 1,247 47 Hong Kong 605 894 1,094 1,085 1,191 1,211 1,230 1,368 1,189 48 India 115 638 961 899 798 762 833 899 843 49 Indonesia 369 340 410 330 597 309 348 575 439 50 Israel 387 392 559 476 519 440 432 453 469 51 Japan 10,207 14,363 14,616 19,020 20,374 19,755 19,890 19,937 21,355 52 Korea 390 438 602 748 714 736 776 790 750 53 Philippines 700 628 687 595 640 566 623 594 578 5 5 5 4 T M h i a d i d la le n d E ast oil-exporting countries5. 7,3 2 5 5 5 2 9,3 2 6 7 0 7 8,9 2 7 6 9 4 7,8 2 9 9 4 7 7,2 3 6 2 7 0 6,7 2 1 9 9 6 6,3 2 5 9 0 0 6,9 3 1 5 1 2 6,3 2 8 7 1 9 56 Other Asia 856 1,398 1,250 1,213 1,510 1,364 1,341 1,384 1,256 57 Africa 3,369 2,298 2,535 2,360 3,013 2,578 2,645 2,540 2,636 5 5 9 8 M Eg o y r p o t c co 3 6 4 8 2 3 8 3 7 3 4 6 04 6 40 2 2 8 5 2 9 8 4 4 6 6 7 3 4 7 1 4 7 32 8 2 4 31 3 2 0 60 South Africa 166 141 174 226 175 160 238 266 294 6 6 1 2 O Za il i - r e e x porting countries6. 2,24 6 0 2 1,11 3 6 6 1,15 3 5 9 9 4 7 4 9 1,36 7 5 3 1,19 5 8 2 1,27 4 0 5 1,23 3 0 9 1,33 4 5 3 63 Other Africa 491 585 698 681 778 638 601 600 622 6 6 4 5 Oth A e u r s t c r o a u li n a tries.. 2 2 , , 1 0 1 0 9 6 2 1 , , 0 9 1 0 2 5 1 1 , , 2 1 9 4 7 0 1 1 , , 4 2 1 1 4 1 1 1 , , 3 1 1 5 5 8 1 1 , , 1 0 8 5 0 1 1,0 8 9 9 0 9 1,1 9 8 1 9 5 1,1 9 8 5 7 0 66 All other 113 107 158 203 157 130 191 213 236 67 Nonmonetary international and regional organizations 5,699 5,714 3,274 2,942 2,678 2,823 3,406 2,929 2,225 68 International 5,415 5,157 2,752 2,311 2,027 2,157 2,339 1,789 1,033 6 7 9 0 O La th ti e n r A re m g e io r n ic a a l n 7 regional. 1 9 8 6 8 2 2 6 9 7 0 2 2 4 7 5 8 2 3 3 9 6 5 2 4 4 1 1 1 2 4 2 3 8 7 7 2 9 6 9 9 2 8 8 5 4 6 3 8 2 7 3 0 includes the Bank for International Settlements. Beginning April 6 Comprises Algeria, Gabon, Libya, and Nigeria. 1978, also includes Eastern European countries not listed in line 23. 7 Asian, African, Middle Eastern, and European regional organizations, 2 Beginning April 1978 comprises Bulgaria, Czechoslovakia, German except the Bank for International Settlements, which is included in Democratic Republic, Hungary, Poland, and Romania. "Other Western Europe." 1978InClUded in "°ther Latin America and Caribbean" through March 4 5 I C n o c m lu p d r e i s s e S s u B ri a n h a r m ai n th , r I o r u an gh , I D ra e q c , e m K b u e w r a i 1 t 9 , 7 O 5. m an, Qatar, Saudi Arabia, tab N l O es T , E s . e e F J o u r l y a 1 d 9 e 7 s 8 c r B i U p L ti L o E n T I o N f , t p h . e 6 c 1 h 2 a . n ges in the International Statistics and. United Arab Emirates (Trucial States). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A61 3.16 BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1978 Area and country 1975 1976 1977 June July Aug. Sept. Oct. Nov.f Dec.*5 1 58,308 79,301 90,206 87,212 87,349 91,844 94,399 96,820 105,338 114,174 2 Foreign countries 58,275 79,261 90,163 87,180 87,313 91,806 94,360 96,779 105,292 114,118 3 Europe 11,109 14,776 18,114 16,249 15,762 16,829 18,301 1199,,332277 20,504 24,105 4 Austria 35 63 65 105 116 107 95 111111 142 147 5 Belgium-Luxembourg 286 482 561 731 634 823 949 1,052 1,232 1,198 6 Denmark 104 133 173 145 129 146 147 160 193 242 7 Finland 180 199 172 182 190 216 221 232 260 305 8 France 1,565 1,549 2,082 1,891 1,813 2,523 2,786 2,752 2,716 3,690 9 Germany 380 509 644 787 689 632 742 808 838 900 10 Greece 290 279 206 204 190 125 126 161 134 164 11 Italy 443 993 1,334 965 1,078 1,027 1,016 1,355 1,453 1,506 12 Netherlands 305 315 338 383 436 405 379 494 602 675 13 Norway 131 136 162 217 210 163 263 238 282 299 14 Portugal 30 88 175 126 140 105 99 106 180 171 15 Spain 424 745 722 706 669 714 770 929 980 1,100 16 Sweden 198 206 218 219 244 290 325 348 465 537 17 Switzerland 199 379 564 685 631 1,013 871 781 1,045 1,282 18 Turkey 164 249 360 309 313 305 305 293 283 273 19 United Kingdom 5,170 7,033 8,964 7,270 6,961 6,933 7,827 8,065 8,356 10,080 20 Yugoslavia 210 234 311 320 300 280 306 293 302 363 21 Other Western Europe 1 76 85 86 153 165 125 128 147 107 178 22 U.S.S.R 406 485 413 319 305 343 370 387 321 364 23 Other Eastern Europe2 513 613 566 534 548 553 575 617 612 631 24 Canada 2,834 3,319 3,355 2,493 3,116 3,343 3,448 3,586 4,552 5,140 25 Latin America and Caribbean 23,863 38,879 45,850 45,990 46,974 49,469 50,397 49,267 54,342 56,257 26 Argentina 1,377 1,192 1,478 1,556 1,572 1,566 1,690 1,447 1,698 2,258 27 Bahamas 7,583 15,464 19,858 18,725 19,643 22,172 20,031 19,208 23,541 21,096 28 Bermuda 104 150 232 145 145 194 141 352 141 189 29 Brazil 3,385 4,901 4,629 4,659 4,599 4,858 5,252 5,596 6,137 6,147 30 British West Indies 1,464 5,082 6,481 7,412 6,872 6,885 8,397 7,170 6,432 9,160 31 Chile 494 597 675 745 745 809 742 832 862 962 32 Colombia 751 675 671 615 648 690 727 793 936 990 33 Cuba 14 13 10 1 1 1 1 * 4 2 34 Ecuador 252 375 517 562 546 560 646 621 681 694 35 Guatemala3 90 83 115 79 85 89 92 36 Jamaica3 53 49 44 46 45 49 42 37 Mexico 3,745 4,822 4,909 4,865 5,068 5,004 5,007 4,927 5,255 5,361 38 Netherlands Antilles4 72 140 224 212 206 198 230 212 242 270 39 Panama 1,138 1,372 1,410 1,901 2,278 1,625 2,280 2,480 2,531 3,060 40 Peru 805 933 962 930 918 928 966 945 931 887 41 Uruguay 57 42 80 53 52 56 51 63 58 58 42 Venezuela 1,319 1,828 2,318 2,240 2,337 2,515 2,745 3,105 3,367 3,449 43 Other Latin America and Caribbean 1,302 1,293 1,394 1,227 1,212 1,250 1,367 1,386 1,388 1,541 44 Asia 17,706 19,204 19,236 19,317 18,326 18,918 18,994 21,358 22,691 25,408 45 China (Mainland) 22 3 10 13 5 31 8 10 6 35 46 China (Taiwan) 1,053 1,344 1,719 1,343 1,193 1,177 1,241 1,285 1,356 1,421 47 Hong Kong 289 316 543 769 698 666 705 1,368 1,385 1,572 48 India 57 69 53 80 46 73 76 66 46 54 49 Indonesia 246 218 232 146 139 125 152 144 188 143 50 Israel 721 755 584 468 445 504 544 555 719 871 51 Japan 10,944 11,040 9,839 10,023 9,779 9,876 10,205 10,568 11,997 12,697 52 Korea 1,791 1,978 2,336 2,328 1,937 1,925 1,930 1,788 1,741 2,233 53 Philippines 534 719 594 "680 641 743 730 732 717 677 54 Thailand 520 442 633 711 725 693 633 734 758 753 55 Middle East oil-exporting countries5 744 1,459 1,746 1,575 1,551 1,951 1,656 2,097 2,181 3,112 56 Other Asia 785 863 947 1,181 1,167 1,155 1,113 2,012 1,599 1,840 57 Africa 1,933 2,311 2,518 2,136 2,133 2,267 2,158 2,219 2,163 2,234 58 Egypt 123 126 119 70 79 62 67 56 68 107 59 Morocco 8 27 43 38 36 42 38 40 36 82 60 South Africa 657 957 1,066 1,054 1,036 1,058 1,022 990 906 860 61 Zaire 181 112 98 79 79 79 82 161 162 180 62 Oil-exporting countries6 382 524 510 383 340 459 406 438 439 449 63 Other 581 565 682 512 563 566 544 534 551 556 64 Other countries 830 772 1,090 995 1,002 980 1,063 1,023 1,040 974 65 Australia 700 597 905 828 836 835 894 879 894 872 66 All other 130 175 186 167 167 145 168 145 147 102 67 Nonmonetary international and regional organizations7 33 40 43 31 36 38 39 41 45 56 1 Includes the Bank for International Settlements. Beginning April 6 Comprises Algeria, Gabon, Libya, and Nigeria. 1978, also includes Eastern European countries not listed in line 23. 7 Excludes the Bank for International Settlements, which is included 2 Beginning April 1978 comprises Bulgaria, Czechoslovakia, German in "Other Western Europe." Democratic Republic, Hungary, Poland, and Romania. 3 Included in "Other Latin America and Caribbean" through March NOTE. Data for period prior to April 1978 include claims of banks' 1978. domestic customers on foreigners. For a description of the changes in 4 Includes Surinam through December 1975. the International Statistics tables, see July 1978 BULLETIN, p. 612. 5 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

A62 International Statistics • February 1979 3.17 BANKS' OWN AND DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1978 TTyyppee ooff ccllaaiimm 11997755 11997766 11997777 June July Aug. Sept. Oct. Nov." Dec.p 1 Total 5588,,330088 7799,,330011 9900,,220066 9999999999999966666666666666,,,,,,,,,,,,,,111111111111118888888888888844444444444444 111111111111110000000000000033333333333333,,,,,,,,,,,,,,555555555555551111111111111155555555555555 2 Banks' own claims on foreigners 8888888888888877777777777777,,,,,,,,,,,,,,222222222222221111111111111122222222222222 8888888877777777,,,,,,,,333333334444444499999999 9999999911111111,,,,,,,,888888884444444444444444 9999999999999944444444444444,,,,,,,,,,,,,,333333333333339999999999999999999999999999 9999999966666666,,,,,,,,888888882222222200000000 111111110000000055555555,,,,,,,,333333333333333388888888 111111111111111144444444,,,,,,,,111111117777777744444444 3 Foreign public borrowers 66666666666666,,,,,,,,,,,,,,000000000000003333333333333366666666666666 66666666,,,,,,,,888888885555555588888888 77777777,,,,,,,,222222229999999922222222 77777777777777,,,,,,,,,,,,,,777777777777770000000000000088888888888888 88888888,,,,,,,,000000005555555511111111 99999999,,,,,,,,111111119999999977777777 1111111100000000,,,,,,,,000000002222222244444444 4 Own foreign offices1 3333333333333311111111111111,,,,,,,,,,,,,,555555555555559999999999999900000000000000 3333333333333333,,,,,,,,888888881111111133333333 3333333377777777,,,,,,,,333333332222222255555555 3333333333333344444444444444,,,,,,,,,,,,,,888888888888882222222222222288888888888888 3333333366666666,,,,,,,,333333335555555577777777 4444444400000000,,,,,,,,444444441111111122222222 4444444400000000,,,,,,,,888888889999999911111111 5 Unaffiliated foreign banks 3333333333333300000000000000,,,,,,,,,,,,,,111111111111116666666666666666666666666666 2222222277777777,,,,,,,,444444449999999999999999 2222222277777777,,,,,,,,444444440000000000000000 3333333333333311111111111111,,,,,,,,,,,,,,444444444444446666666666666677777777777777 3333333311111111,,,,,,,,000000008888888800000000 3333333333333333,,,,,,,,444444446666666644444444 3333333399999999,,,,,,,,999999994444444400000000 6 Deposits 55555555555555,,,,,,,,,,,,,,111111111111111111111111111166666666666666 44444444,,,,,,,,666666662222222233333333 44444444,,,,,,,,333333335555555522222222 44444444444444,,,,,,,,,,,,,,444444444444448888888888888822222222222222 33333333,,,,,,,,999999996666666655555555 44444444,,,,,,,,111111113333333399999999 55555555,,,,,,,,333333335555555500000000 7 Other 2222222222222255555555555555,,,,,,,,,,,,,,000000000000005555555555555500000000000000 2222222222222222,,,,,,,,888888887777777766666666 2222222233333333,,,,,,,,000000004444444499999999 2222222222222266666666666666,,,,,,,,,,,,,,999999999999998888888888888855555555555555 2222222277777777,,,,,,,,111111111111111155555555 2222222299999999,,,,,,,,333333332222222255555555 3333333344444444,,,,,,,,555555559999999911111111 8 All other foreigners 1111111111111199999999999999,,,,,,,,,,,,,,444444444444441111111111111199999999999999 1111111199999999,,,,,,,,111111117777777799999999 1111111199999999,,,,,,,,888888882222222266666666 2222222222222200000000000000,,,,,,,,,,,,,,333333333333339999999999999966666666666666 2222222211111111,,,,,,,,333333333333333322222222 2222222222222222,,,,,,,,222222226666666655555555 2222222233333333,,,,,,,,333333331111111188888888 9 Claims of banks' domestic customers2 88888888888888,,,,,,,,,,,,,,999999999999997777777777777733333333333333 ''''''''''''''99999999999999,,,,,,,,,,,,,,111111111111111111111111111166666666666666 10 Deposits 333333333333338888888888888899999999999999 rrrrrrrrrrrrrr555555555555550000000000000000000000000000 11 Negotiable and readily transferable instruments 3 33333333333333,,,,,,,,,,,,,,666666666666669999999999999944444444444444 ''''''''''''''33333333333333,,,,,,,,,,,,,,777777777777772222222222222244444444444444 1122 OOuuttssttaannddiinngg ccoolllleeccttiioonnss aanndd ootthheerr ccllaaiimmss44........ 55,,446677 55,,775566 66,,117766 44444444444444,,,,,,,,,,,,,,888888888888888888888888888899999999999999 ''''''''''''''44444444444444,,,,,,,,,,,,,,888888888888889999999999999922222222222222 1133 MMEEMMOO:: CCuussttoommeerr lliiaabbiilliittyy oonn aacccceeppttaanncceess...... 1111111111111111111111111111,,,,,,,,,,,,,,999999999999999999999999999955555555555555 ''''''''''''''1111111111111122222222222222,,,,,,,,,,,,,,777777777777774444444444444477777777777777 1 U.S. banks: includes amounts due from own foreign branches and 3 Principally negotiable time certificates of deposit and bankers acforeign subsidiaries consolidated in "Consolidated Report of Condition" ceptances. filed with bank regulatory agencies. Agencies, branches, and majority- 4 Data for March 1978 and for period prior to that are outstanding owned subsidiaries of foreign banks: principally amounts due from head collections only. office or parent foreign bank, and foreign branches, agencies, or whollyowned subsidiaries of head office or parent foreign bank. NOTE. Beginning April 1978, data for banks' own claims are given 2 Assets owned by customers of the reporting bank located in the on a monthly basis, but the data for claims of banks' domestic customers United States that represent claims on foreigners held by reporting banks are available on a quarterly basis only. for the account of their domestic customers. For a description of the changes in the International Statistics tables, see July 1978 BULLETIN, p. 612. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A63 3.18 BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1978 1979 MMaattuurriittyy;; bbyy bboorrrroowweerr aanndd aarreeaa 11997788 11997799 Junef Sept.? Dec. Mar. June Sept. 1 Total 5555555555555555555555555555555555555555,,,,,,,,,,,,,,,,,,,,111111111111111111112222222222222222222288888888888888888888 5555555555555555555599999999999999999999,,,,,,,,,,,,,,,,,,,,555555555555555555551111111111111111111166666666666666666666 By borrower: 4444444444444444444433333333333333333333,,,,,,,,,,,,,,,,,,,,666666666666666666668888888888888888888822222222222222222222 4444444444444444444466666666666666666666,,,,,,,,,,,,,,,,,,,,666666666666666666668888888888888888888844444444444444444444 22222222222222222222,,,,,,,,,,,,,,,,,,,,999999999999999999991111111111111111111199999999999999999999 33333333333333333333,,,,,,,,,,,,,,,,,,,,666666666666666666664444444444444444444400000000000000000000 4 All other foreigners 4444444444444444444400000000000000000000,,,,,,,,,,,,,,,,,,,,777777777777777777776666666666666666666633333333333333333333 4444444444444444444433333333333333333333,,,,,,,,,,,,,,,,,,,,000000000000000000004444444444444444444444444444444444444444 5 Maturity of over 1 year 1 1111111111111111111111111111111111111111,,,,,,,,,,,,,,,,,,,,444444444444444444444444444444444444444455555555555555555555 1111111111111111111122222222222222222222,,,,,,,,,,,,,,,,,,,,888888888888888888883333333333333333333322222222222222222222 6 Foreign public borrowers. 33333333333333333333,,,,,,,,,,,,,,,,,,,,111111111111111111116666666666666666666622222222222222222222 33333333333333333333,,,,,,,,,,,,,,,,,,,,999999999999999999992222222222222222222288888888888888888888 7 All other foreigners 88888888888888888888,,,,,,,,,,,,,,,,,,,,222222222222222222228888888888888888888833333333333333333333 88888888888888888888,,,,,,,,,,,,,,,,,,,,999999999999999999990000000000000000000044444444444444444444 By area: Maturity of 1 year or less1 8 Europe 99999999999999999999,,,,,,,,,,,,,,,,,,,,555555555555555555553333333333333333333322222222222222222222 1111111111111111111100000000000000000000,,,,,,,,,,,,,,,,,,,,333333333333333333338888888888888888888866666666666666666666 9 Canada. . 11111111111111111111,,,,,,,,,,,,,,,,,,,,666666666666666666661111111111111111111155555555555555555555 11111111111111111111,,,,,,,,,,,,,,,,,,,,999999999999999999994444444444444444444433333333333333333333 10 Latin America and Caribbean 1111111111111111111177777777777777777777,,,,,,,,,,,,,,,,,,,,000000000000000000003333333333333333333366666666666666666666 1111111111111111111188888888888888888888,,,,,,,,,,,,,,,,,,,,555555555555555555551111111111111111111188888888888888888888 11 Asia . . 1111111111111111111133333333333333333333,,,,,,,,,,,,,,,,,,,,555555555555555555551111111111111111111155555555555555555555 1111111111111111111133333333333333333333,,,,,,,,,,,,,,,,,,,,777777777777777777771111111111111111111122222222222222222222 12 Africa 11111111111111111111,,,,,,,,,,,,,,,,,,,,444444444444444444446666666666666666666611111111111111111111 11111111111111111111,,,,,,,,,,,,,,,,,,,,555555555555555555553333333333333333333355555555555555555555 13 All other2. . . 555555555555555555552222222222222222222233333333333333333333 555555555555555555559999999999999999999911111111111111111111 Maturity of over 1 year 1 14 Europe 22222222222222222222,,,,,,,,,,,,,,,,,,,,999999999999999999997777777777777777777799999999999999999999 33333333333333333333,,,,,,,,,,,,,,,,,,,,111111111111111111110000000000000000000044444444444444444444 15 Canada .. 333333333333333333333333333333333333333300000000000000000000 777777777777777777779999999999999999999933333333333333333333 16 Latin America and Caribbean 55555555555555555555,,,,,,,,,,,,,,,,,,,,999999999999999999997777777777777777777799999999999999999999 66666666666666666666,,,,,,,,,,,,,,,,,,,,888888888888888888884444444444444444444433333333333333333333 17 Asia 11111111111111111111,,,,,,,,,,,,,,,,,,,,222222222222222222228888888888888888888822222222222222222222 11111111111111111111,,,,,,,,,,,,,,,,,,,,333333333333333333330000000000000000000055555555555555555555 18 Africa . 666666666666666666662222222222222222222299999999999999999999 555555555555555555557777777777777777777777777777777777777777 19 All other2 222222222222222222224444444444444444444477777777777777777777 222222222222222222221111111111111111111111111111111111111111 1 Remaining time to maturity. NOTE. The first available data are for June 1978. For a description of 2 Includes nonmonetary international and regional organizations. the changes in the International Statistics tables, see July 1978 BULLETIN, p. 612. 3.19 LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in Foreign Currencies Millions of dollars, end of period 1978 Item 1974 1975 1976 1977 Mar. June? Sept.P 1 Banks' own liabilities 776666 556600 778811 992255 998866 111,,,777000444 111,,,999888111 2 Banks' own claims1 11,,227766 11,,445599 11,,883344 22,,335566 22,,338833 333,,,111555333 333,,,555333000 3 Deposits 666699 665566 11,,110033 994411 994488 111,,,222999000 111,,,333888666 4 Other claims 660077 880022 773311 11,,441155 11,,443355 111,,,888666333 222,,,111444444 5 Claims of banks' domestic customers2 888000999 444444666 1 Includes claims of banks' domestic customers through March 1978. NOTE. Data on claims exclude foreign currencies held by U.S. mone- 2 Assets owned by customers of the reporting bank located in the tary authorities. United States that represent claims on foreigners held by reporting banks For a description of the changes in the International Statistics tables, for the accounts of their domestic customers. see July 1978 BULLETIN, p. 612. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 International Statistics • February 1979 3.20 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Holdings and Transactions Millions of dollars 1978 1978 Country or area 1976 1977 D Ja e n c . . - f June July Aug. Sept. Oct. Nov.p Dec.f Holdings (end of period) 4 1 Estimated totali... 15,799 38,640 40,658 41,148 41,573 42,212 43,622 43,847 44,928 2 Foreign countries1. 12,765 33,894 34,964 36,306 37,119 37,826 38,472 38,469 39,807 Europe1 2,330 13,936 13,106 14,226 14,154 14,689 15,260 15,654 17,072 Belgium-Luxembourg.. 14 19 19 19 19 19 19 19 19 Germany1 764 3,168 4,361 5,531 5,761 6,157 6,645 7,102 8,705 Netherlands 288 911 1,113 1,113 1,278 1,306 1,356 1,351 1,358 Sweden 191 100 185 200 210 211 231 266 285 Switzerland 261 497 529 590 636 694 731 915 977 United Kingdom 485 8,888 6,527 6,403 5,862 5,909 5,915 5,674 5,373 10 Other Western Europe. 323 349 371 370 387 393 365 327 354 11 Eastern Europe 4 4 12 Canada. 256 288 264 275 276 276 151 151 152 13 Latin America and Caribbean 313 551 494 485 545 445 426 416 416 14 Venezuela 149 199 174 174 244 144 144 144 144 15 Other Latin American and Caribbean. 47 183 158 149 139 139 119 109 110 16 Netherlands Antilles 118 170 162 162 162 162 162 162 162 17 Asia 9.323 18.745 20,605 20,831 21,647 21,919 21,938 21,560 21,478 18 Japan 2,687 6,860 9,616 9,927 10,791 11,096 11,560 11,483 11,528 19 543 362 491 491 491 491 691 691 691 Africa 20 All other. * 11 4 -3 7 5 6 -3 -3 21 Nonmonetary international and regional organizations 3,034 4,746 5,694 4,842 4,454 4,386 5,150 5,378 5,121 22 International 2,906 4,646 5,633 4,809 4,421 4,354 5,118 5,345 5,089 23 Latin American regional. 128 100 61 33 33 33 33 33 33 Transactions (net purchases, or sales (—), during period) 24 Total i 8,096 22,843 6,287 1,271 490 425 639 1,410 225 -1,081 5,393 21,130 5,912 599 1,342 813 706 646 -3 -1,338 26 Official institutions 5,119 20,369 3,682 522 1,313 710 704 577 69 -371 27 Other foreign i 274 762 2,229 77 29 103 3 69 -72 1,708 28 Nonmonetary international and regional organizations 2,704 1,713 376 671 -852 -387 -67 764 227 -256 MEMO: Oil-exporting countries 29 Middle East 2 3,887 4,451 — 1 ,790 -185 -85 -31 -31 -401 -241 -127 30 Africa 3 221 -181 329 * * * * 200 -1 * 1 Includes U.S. Treasury notes publicly issued to private foreign 4 Estimated official and private holdings of marketable U.S. Treasury residents. securities with an original maturity of more than 1 year. Data are based 2 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, on a benchmark survey of holdings as of Jan. 31, 1971, and monthly and United Arab Emirates (Trucial States). transactions reports. Excludes nonmarketable U.S. Treasury bonds and 3 Comprises Algeria, Gabon, Libya, and Nigeria. notes held by official institutions of foreign countries. 3.21 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS Millions of dollars, end of period 1978 1979 AAsssseettss 11997755 11997766 11997777 July Aug. Sept. Oct. Nov. Dec. Jan P 1 Deposits 353 352 424 347 309 325 305 379 367 338 Assets held in custody: 2 U.S. Treasury securities1 60,019 66,532 91,962 101,696 102,902 102,699 107,934 112,434 117,126 116,961 3 Earmarked gold2 16,745 16,414 15,988 15,594 15,572 15,553 15,548 15,525 15,463 15,448 1 Marketable U.S. Treasury bills, certificates of indebtedness, notes, NOTE. Excludes deposits and U.S. Treasury securities held for interand bonds ; and nonmarketable U.S. Treasury securities payable in dollars national and regional organizations. Earmarked gold is gold held for and inforeign 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 3.22 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1978 1978 TTrraannssaaccttiioonnss,, aanndd aarreeaa oorr ccoouunnttrryy 1976 1977 D Ja e n c. . f - June July Aug. Sept. Oct. Nov.f Dec.f U.S. corporate securities Stocks Foreign purchases 18.227 14,155 20,069 2,055 1,305 2,444 2,357 1,509 1,461 1,421 2 Foreign sales 15,475 11,479 17,698 1,936 1,296 2,678 2,115 1,523 1,359 1,085 3 Net purchases, or sales (—) 2,753 2,676 2,370 119 9 -235 241 -14 103 336 4 Foreign countries 2,740 2,661 2,416 139 9 -235 244 -15 102 336 5 Europe 336 1,006 1,233 39 -6 -152 -33 -91 -10 264 6 France 256 40 49 -39 -15 9 2 -4 1 -36 7 Germany 68 291 619 83 17 -54 24 -30 8 263 8 Netherlands -199 22 -22 -18 9 -22 7 7 6 -9 9 Switzerland -100 152 -584 -76 -52 -184 -115 -118 -88 -22 10 United Kingdom 340 613 1,218 101 50 110 54 58 67 74 n Canada 324 65 74 -12 -16 -18 117 22 6 38 12 Latin America and Caribbean 155 127 151 33 -35 48 1 13 -2 16 13 Middle East1 1,803 1,390 781 59 69 -134 120 42 109 4 14 Other Asia 119 59 187 23 -5 35 35 -4 1 15 15 Africa 7 5 -13 -3 1 -12 5 2 -2 -1 16 Other countries -4 8 3 * * -1 -1 2 1 1 17 Nonmonetary international and regional organizations 13 15 -46 -21 * * -3 1 1 4c Bonds2 18 Foreign purchases 5,529 7,739 7,954 669 1,029 872 611 727 437 884 19 Foreign sales 4,327 3,546 5,449 302 596 490 550 530 388 558 20 Net purchases, or sales (—) 1,202 4,192 2,505 367 433 383 61 197 49 326 21 Foreign countries 1,243 4,096 2,096 295 411 330 64 137 39 134 22 Europe 86 1,863 966 157 387 137 80 89 25 152 23 France 39 -34 30 -3 13 6 -2 -10 3 17 24 Germany -49 -20 119 14 18 38 -5 -12 6 10 25 Netherlands -29 72 19 -7 11 18 19 -4 -1 -6 26 Switzerland 155 94 -100 5 -74 -20 43 9 9 39 27 United Kingdom 23 1,703 936 154 416 * 110 9 115 28 Canada 96 141 102 6 14 24 16 -5 * 6 29 Latin America and Caribbean 94 64 78 2 -8 17 11 13 -1 5 30 Middle East1 1,179 1,695 810 91 135 99 -73 —19 -8 -21 31 Other Asia -165 338 140 39 —116 52 29 60 23 -5 32 Africa -25 -6 -1 * * * * * * * 33 Other countries -21 • 1 * * 1 * * * -3 34 Nonmonetary international and regional organizations -41 96 409 72 22 53 -3 60 10 192 1 Foreign securities 35 Stocks, net purchases, or sales (—) -323 -410 523 -61 10 51 -69 -19 163 -12 36 Foreign purchases 1,937 2,255 3,661 247 333 382 261 299 360 232 37 Foreign sales 2,259 2,665 3,138 308 323 331 330 318 197 244 38 Bonds, net purchases, or sales (—) -8,774 -5,095 -3,892 -636 -291 -196 33 -677 -448 170 39 Foreign purchases 4,932 8,040 10,996 1,095 921 982 759 941 854 1,020 40 Foreign sales 13,706 13,134 14,888 1,730 1,212 1,178 726 1,618 1,302 851 41 Net purchases, or sales ( —) of stocks and bonds.. -9,097 -5,504 -3,369 -697 -281 -145 -36 -696 -285 157 42 Foreign countries -7,199 -3,947 -3,192 -742 -283 -150 -70 -507 -305 116 43 Europe -850 -1,100 16 -220 -171 94 -86 13 -102 102 44 Canada -5,245 -2,404 -3,237 -420 -146 -161 -41 -747 -246 -24 45 Latin America and Caribbean -3 -80 203 -68 8 -17 -12 -17 16 * 46 Asia -733 -97 412 192 44 54 69 236 21 32 47 Africa 48 2 -441 -44 -25 -123 _ i 1 1 * 48 Other countries -416 -267 -146 -182 7 3 1 6 4 5 49 Nonmonetary international and regional organizations -1,898 -1,557 -177 45 2 5 34 -189 20 41 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 • February 1979 3.23 SHORT-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars, end of period 1977 1978 1977 1978 Type, and area or country Sept. Dec. Mar. June Sept.3* Sept. Dec. Mar. June Sept.p Liabilities to foreigners Claims on foreigners 1 '7,243 '7,910 '8,361 8,792 9,645 '15,223 '16,221 '18,399 18,162 18,260 By type: 2 Payable in dollars '6,386 r7,109 r7,477 7,967 8,794 '14,120 ' 14,803 ' 16,636 16,598 16,291 3 Payable in foreign currencies 857 801 884 825 851 ' 1,104 '' 11,,441188 ' 1,763 11,,556644 11,,996699 4 Deposits with banks abroad in reporter's name 414 '613 '783 673 804 5 Other ''669900 ''880055 ''998800 889900 11,,116655 By area or country: 6 Foreign countries '7,089 '7,695 '8,214 8,661 9,521 '15,222 '16,220 '18,397 18,160 18,258 7 Europe '2,317 '2,491 '2,820 2,993 3,159 r5,062 ' 5,764 r5,508 5,273 5,887 8 Austria 19 21 26 26 33 24 24 21 28 25 9 Belgium-Luxembourg 126 116 171 167 165 226 211 187 155 172 10 16 14 23 22 17 44 56 47 40 34 11 11 9 12 3 4 59 13 13 53 50 12 170 238 273 302 260 430 513 545 533 622 13 Germany 226 284 335 356 391 '395 '450 '420 436 534 14 Greece 78 85 108 82 71 52 41 42 40 44 15 Italy 107 128 104 156 188 '351 387 '381 451 400 16 Netherlands 180 232 253 220 222 161 166 184 192 175 17 Norway 12 7 9 18 23 38 '40 '40 45 42 18 Portugal 12 11 7 25 11 34 69 27 54 34 19 74 77 94 105 110 307 387 408 376 351 20 Sweden 41 28 37 38 51 91 117 117 78 80 21 Switzerland 257 263 '211 282 308 146 220 '202 285 346 22 Turkey 97 108 93 92 102 32 39 35 29 31 23 United Kingdom '765 '735 '937 962 1,058 '2,479 '2,795 '2,619 2,338 2,818 24 92 90 82 84 76 20 20 24 27 23 25 Other Western Europe 9 10 8 18 17 15 25 33 24 28 26 U.S.S.R 11 24 15 19 27 62 55 44 37 33 27 Other Eastern Europe 14 12 23 17 25 96 135 121 51 45 28 Canada 451 504 530 524 566 2,649 r2,681 r3,428 3,502 3,724 29 Latin America '1,038 ' 1,201 ' 1,353 1,421 1,532 4,619 r4,467 ' 5,943 6,001 5,142 30 Argentina 50 40 53 74 131 53 53 53 61 65 31 '248 '329 '327 321 353 1,963 '2,019 '3,122 3,081 2,350 32 Brazil 76 49 62 63 87 414 '493 '482 479 418 33 Chile 13 17 14 23 14 40 45 40 37 40 34 24 42 26 42 42 85 84 80 79 69 35 Cuba * # * * * * * * * 1 36 103 114 169 185 235 302 314 312 331 382 37 12 22 12 71 59 222 91 175 97 76 38 Peru 13 15 22 17 19 30 32 30 30 25 39 Uruguay 4 3 5 9 7 5 5 6 4 5 40 Venezuela '210 '216 '264 185 232 251 269 306 309 284 41 122 118 107 101 121 257 281 268 229 223 42 Netherlands Antilles 9 25 41 30 19 8 12 24 19 21 43 Other Latin America 154 209 250 299 213 989 '768 '1,045 1,245 1,183 44 r2,583 ''22,,883355 '' 22,,881144 33,,000088 3,517 r2,398 '2,777 r2,970 ' 2,810 2,905 45 China, (Mainland) 1 88 11 11 4 12 9 22 21 23 46 China, (Taiwan) 152 156 167 170 176 139 157 144 173 157 47 Hong Kong 25 40 32 30 61 73 98 85 92 127 48 India 44 37 26 10 23 42 38 85 93 85 49 60 56 57 59 49 '184 375 185 152 167 50 Israel 58 63 68 59 68 46 38 47 43 86 51 Japan 604 695 761 807 865 1,026 1,068 1,379 1,142 1,157 52 Korea 75 103 99 107 103 153 171 133 168 161 53 Philippines 78 74 95 107 157 111 99 94 96 107 54 Thailand 17 17 11 27 43 24 23 32 30 29 55 Other Asia '1,469 '1,588 '1,498 1,631 1,968 '587 '702 '764 800 804 56 Africa 588 '577 r594 603 661 r340 r386 r402 430 441 57 Egypt 45 13 19 25 34 '18 '34 31 36 29 58 Morocco 105 112 130 148 145 10 21 22 16 16 59 South Africa 29 20 30 36 34 75 75 71 88 74 60 Zaire 48 46 55 57 56 19 15 11 16 12 61 Other Africa 361 '380 '360 338 391 '218 '241 '268 274 311 62 Other countries 111 93 104 111 85 153 146 145 143 158 63 Australia 93 75 89 97 72 113 111 111 109 118 64 All other 18 18 14 14 14 41 35 34 34 40 65 Nonmonetary international and regional organizations 115544 221155 114477 113322 112255 11 1 1 2 2 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 3.24 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Large Nonbanking Concerns in the United States Millions of dollars, end of period 1978 Type and country 1974 1975 1976 1977' June7" July' Aug.r Sept. ' Oct. Nov.** 1 Total 3,357 3,799 5,720 7,136 8,812 8,949 10,098 8,635 10,503 11,223 By type: 2 Payable in dollars 2,660 3,042 4,984 6,121 7,670 7,643 8,818 7,409 9,240 9,981 3 Deposits 2,591 2,710 4,505 5,703 7,129 7,172 8,282 6,985 8,688 9,362 4 Short-term investments 69 332 479 418 541 471 536 424 552 619 5 Payable in foreign currencies 697 757 735 1,015 1,142 1,305 1,280 1,225 1,263 1,241 6 Deposits 429 511 404 547 599 689 660 730 789 111 7 Short-term investments 1. 268 246 331 468 543 616 620 495 474 470 By country: 8 United Kingdom 1,350 1,306 1,838 2,120 1,660 1,878 1,869 2.246 2,949 3,137 9 Canada 967 1,156 1,698 1,777 2,559 2,537 3,013 2,452 2,858 2,833 10 Bahamas 391 546 1,355 1,896 2,946 3,217 3,543 2.247 2,819 3,033 11 Japan 398 343 133 153 258 279 276 250 234 249 12 All other 252 446 716 1,190 1,389 1,038 1,397 1,440 1,643 1,971 1 Negotiable and other readily transferable foreign obligations payable NOTE. Data represent the assets abroad of large nonbanking conon demand or having a contractural maturity of not more than 1 year cerns in the United States. They are a portion of the total claims on from the date on which the obligation was incurred by the foreigner. foreigners reported by nonbanking concerns in the United States and are included in the figures shown in table 3.26. 3.25 LONG-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in, the United States Millions of dollars, end of period 1977 1978 1977 1978 AArreeaa aanndd ccoouunnttrryy Sept. Dec. Mar. June Sept.** Sept. Dec. Mar. June Sept.35 Liabilities to foreigners Claims on foreigners 1 Total '3,331 r3,175 '3,149 3,077 3,122 '4,719 '5,077 '5,143 5,067 5,007 2 Europe r2,555 r2,425 '2,498 2,422 2,471 '833 '864 '937 943 927 3 Germany 407 255 295 282 290 '79 '74 '75 71 76 4 Netherlands 272 287 292 266 275 81 82 81 76 74 5 Switzerland 224 241 241 236 246 42 49 48 55 58 6 United Kingdom rl,237 ' 1,222 '1,228 1,214 1,253 282 310 332 363 341 7 Canada r67 r62 '58 56 65 1,462 1,776 1,792 1,811 1,779 8 Latin America 289 284 '248 248 234 1,367 1,402 1,387 1,298 1,283 9 Bahamas 151 148 142 141 138 36 40 42 2 2 10 Brazil 7 7 6 7 7 134 144 154 143 144 11 Chile 1 1 1 1 1 201 203 194 190 176 12 Mexico 30 30 '27 26 29 187 177 183 188 217 13 Asia 358 342 284 290 289 829 817 810 803 812 14 Japan 319 305 250 255 254 94 66 83 78 70 15 Africa 3 2 2 2 3 165 161 156 154 149 16 All other i 59 60 60 60 61 63 59 60 59 56 1 Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 International Statistics • February 1979 3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Per cent per annum Rate on Jan. 31, 1979 Rate on Jan. 31, 1979 Rate on Jan. 31, 1979 Country Country Country Per Month Per Month Per Month cent effective cent effective cent effective Argentina 18.0 Feb. 1972 France 9.5 Aug. 1977 7.0 Feb. 1978 Austria... 4.5 June 1978 Germany, Fed. Rep. of. 3.0 Dec. 1977 6.5 July 1978 Belgium.. 6.0 July 1978 Italy 10.5 Sept. 1978 1.0 Feb. 1978 Brazil 33.0 Nov. 1978 Japan 3.5 Mar. 1978 United Kingdom 12.5 Nov. 1978 Canada.. 11.25 Jan. 1979 Mexico 4.5 June 1942 5.0 Oct. 1970 Denmark. 8.0 July 1977 Netherlands 6.5 Oct. 1978 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. 3.27 FOREIGN SHORT-TERM INTEREST RATES Per cent per annum, averages of daily figures 1978 1979 CCoouunnttrryy,, oorr ttyyppee 11997766 11997777 11997788 Aug. Sept. Oct. Nov. Dec. Jan. 1 Euro-dollars 5.58 6.03 8.74 8.48 9.12 10.12 11.51 11.62 11.16 2 United Kingdom 11.35 8.07 9.18 9.42 9.29 10.44 12.00 12.28 12.61 3 Canada 9.39 7.47 8.52 8.77 9.08 9.68 10.37 10.44 10.87 4 Germany 4.19 4.30 3.67 3.64 3.67 3.90 3.81 4.09 3.85 5 Switzerland 1.45 2.56 0.74 0.67 0.58 0.24 0.20 0.22 0.05 6 Netherlands 7.02 4.73 6.53 6.27 6.91 11.23 8.86 10.25 8.69 7 France 8.65 9.20 8.10 7.39 7.40 7.37 7.06 6.59 6.55 8 Italy 16.32 14.26 11.40 11.75 10.94 10.99 11.17 11.24 11.12 9 Belgium 10.25 6.95 7.14 7.09 7.24 8.55 9.19 9.28 8.93 10 Japan 7.70 6.22 4.75 4.64 4.51 4.44 4.78 4.76 4.52 NOTE. Rates are for 3-month interbank loans except for—Canada, over; and Japan, loans and discounts that can be called after being held finance company paper; Belgium, time deposits of 20 million francs and over a minimum of two month-ends. 3.28 FOREIGN EXCHANGE RATES Cents per unit of foreign currency 1978 1979 CCoouunnttrryy//ccuurrrreennccyy 11997766 11997777 11997788 Aug. Sept. Oct. Nov. Dec. Jan. 1 Australia/dollar 122.15 110.82 114.41 115.41 115.29 116.87 114.53 114.15 114.04 2 Austria/schilling 5.5744 6.0494 6.8958 6.9490 7.0102 7.4526 7.1808 7.2621 7.3821 3 Belgium/franc 2.5921 2.7911 3.1809 3.1834 3.2207 3.4503 3.3389 3.3637 3.4276 4 Canada/dollar 101.41 94.112 87.729 87.690 85.739 84.546 85.244 84.763 84.041 5 Denmark/krone 16.546 16.658 18.156 18.171 18.411 19.584 19.025 19.063 19.487 6 Finland/markka 25.938 24.913 24.337 24.381 24.586 25.454 24.932 24.957 25.252 7 France/franc 20.942 20.344 22.218 22.998 22.909 23.767 22.958 23.178 23.570 8 Germany/deutsche mark... 39.737 43.079 49.867 50.084 50.778 54.430 52.508 53.217 54.056 9 India/rupee 11.148 11.406 12.207 12.483 12.445 12.643 12.458 12.174 12.185 10 Ireland/pound 180.48 174.49 191.84 194.06 195.95 200.75 196.08 198.61 200.53 11 Italy/lira .12044 .11328 .11782 .11952 .12050 .12317 .11857 .11863 .11955 12 Japan/yen .33741 .37342 .47981 .53002 .52656 .54478 .52066 .51038 .50571 13 Malaysia/ringgit 39.340 40.620 43.210 43.433 43.603 45.627 45.415 45.524 45.487 14 Mexico/peso 6.9161 4.4239 4.3896 4.3758 4.3907 4.3904 4.3881 4.3950 4.4038 15 Netherlands/guilder 37.846 40.752 46.284 46.203 46.733 50.017 48.512 49.120 50.082 16 New Zealand/dollar 99.115 96.893 103.64 105.42 105.58 107.37 105.41 105.45 105.64 17 Norway/krone 18.327 18.789 19.079 19.018 19.189 20.325 19.736 19.574 19.730 18 Portugal/escudo 3.3159 2.6234 2.2782 2.2042 2.1948 2.2342 2.1510 2.1472 2.1358 19 South Africa/rand 114.85 114.99 115.01 115.00 115.00 115.00 115.04 115.01 114.96 20 Spain/peseta 1.4958 1.3287 1.3073 1.3344 1.3605 1.4317 1.4051 1.4085 1.4293 21 Sri Lanka/rupee 11.908 11.964 6.3834 6.3926 6.3855 6.3757 6.4695 6.4700 6.4491 22 Sweden/krona 22.957 22.383 22.139 22.523 22.592 23.349 22.856 22.808 22.987 23 Switzerland/franc : 40.013 41.714 56.283 60.013 63.765 65.117 59.766 59.703 59.840 24 United Kingdom/pound... 180.48 174.49 191.84 194.06 195.95 200.75 196.08 198.61 200.53 MEMO: 25 United States/dollar1 110055..5577 110033..3311 8899..9999 8899..5511 8866..0044 8888..8866 8888..5522 8877..7777 1 Index of weighted average exchange value of U.S. dollar against cur- the Weighted-Average Exchange Value of the U.S. Dollar: Revision" on rencies of other G-10 countries plus Switzerland. March 1973 = 100. page 700 of the August 1978 BULLETIN. Weights are 1972-76 global trade of each of the 10 countries. Series revised as of August 1978. For description and back data, see "Index of NOTE. Averages of certified noon buying rates in New York for cable transfers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

69 Guide to Tabular Presentation and Statistical Releases GUIDE TO TABULAR PRESENTATION Symbols and Abbreviations c Corrected 0 Calculated to be zero e Estimated n.a. Not available P Preliminary n.e.c. Not elsewhere classified r Revised (Notation appears on column head- IPCs Individuals, partnerships, and corporations ing when more than half of figures in that REITs Real estate investment trusts column are changed.) RPs Repurchase agreements Amounts insignificant in terms of the last SMSAs Standard metropolitan statistical areas decimal place shown in the table (for Cell not applicable. example, less than 500,000 when the smallest unit given is millions) General Information Minus signs are used to indicate (1) a decrease, (2) as well as direct obligations of the Treasury. "State a negative figure, or (3) an outflow. and local government'1 also includes municipalities, "U.S. government securities" may include guaran- special districts, and other political subdivisions. teed issues of U.S. government agencies (the flow of In some of the tables details do not add to totals funds figures also include not fully guaranteed issues) because of rounding. STATISTICAL RELEASES List Published Semiannually, with Latest Bulletin Reference Issue Page Anticipated schedule of release dates for individual releases December 1978 A-76 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 70 Federal Reserve Board of Governors G. William Miller, Chairman Philip E. Coldwell Henry C. Wallich J. Charles Partee OFFICE OF BOARD MEMBERS OFFICE OF STAFF DIRECTOR FOR MONETARY AND FINANCIAL POLICY JOSEPH R. COYNE, Assistant to the Board KENNETH A. GUENTHER, Assistant to the Board STEPHEN H. AXILROD, Staff Director JAY PAUL BRENNEMAN, Special Assistant to the EDWARD C. ETTIN, Deputy Staff Director Board MURRAY ALTMANN, Assistant to the Board FRANK O'BRIEN, JR., Special Assistant to the PETER M. KEIR, Assistant to the Board Board STANLEY J. SIGEL, Assistant to the Board JOSEPH S. SIMS, Special Assistant to the Board NORMAND R. V. BERNARD, Special Assistant to DONALD J. WINN, Special Assistant to the Board 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 JOHN H. KALCHBRENNER, Associate Director Counsel JOHN J. MINGO, Senior Research Division ALLEN L. RAIKEN, Associate General Counsel Officer CHARLES R. MCNEILL, Assistant to the General ELEANOR J. STOCKWELL, Senior Research Counsel Division Officer JAMES M. BRUNDY, Associate Research Division Officer OFFICE OF THE SECRETARY ROBERT A. EISENBEIS, Associate Research Division Officer Theodore E. Allison, Secretary JARED J. ENZLER, Associate Research Division Griffith L. Garwood, Deputy Secretary Officer "John M. Wallace, Assistant Secretary J. CORTLAND G. PERET, Associate Research Richard H. Puckett, Manager, Regulatory Division Officer Improvement Project MICHAEL J. PRELL, Associate Research Division Officer HELMUT F. WENDEL, Associate Research DIVISION OF CONSUMER AFFAIRS Division Officer ROBERT M. FISHER, Assistant Research Division JANET O. HART, Director Officer NATHANIEL E. BUTLER, Associate Director FREDERICK M. STRUBLE, Assistant Research JERAULD C. KLUCKMAN, Associate Director Division Officer ANNE GEARY, Assistant Director STEPHEN P. TAYLOR, Assistant Research Division Officer LEVON H. GARABEDIAN, Assistant Director DIVISION OF BANKING DIVISION OF INTERNATIONAL FINANCE SUPERVISION AND REGULATION EDWIN M. TRUMAN, Director JOHN E. RYAN, Director ROBERT F. GEMMILL, Associate Director fFREDERiCK C. SCHADRACK, Deputy Director GEORGE B. HENRY, Associate Director FREDERICK R. DAHL, Associate Director CHARLES J. SIEGMAN, Associate Director WILLIAM W. WILES, Associate Director SAMUEL PIZER, Senior International Division JACK M. EGERTSON, Assistant Director Officer DON E. KLINE, Assistant Director JEFFREY R. SHAFER, Associate International ROBERT S. PLOTKIN, Assistant Director Division Officer THOMAS A. SIDMAN, Assistant Director DALE W. HENDERSON, Assistant International SAMUEL H. TALLEY, Assistant Director Division Officer WILLIAM TAYLOR, Assistant Director LARRY J. PROMISEL, Assistant International Division Officer ::On loan from the Federal Reserve Bank of Atlanta. RALPH W. SMITH, JR., Assistant International tOn loan from the Federal Reserve Bank of New York. Division Officer Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 71 and Official Staff Nancy H. Teeters 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 JOSEPH W. DANIELS, SR., Director of Equal DIVISION OF FEDERAL RESERVE Employment Opportunity HARRY A. GUINTER, Program Director for BANK EXAMINATIONS AND BUDGETS Contingency Planning ALBERT R. HAMILTON, Director CLYDE H. FARNSWORTH, JR., Associate DIVISION OF DATA PROCESSING Director CHARLES W. BENNETT, Assistant Director CHARLES L. HAMPTON, Director P. D. RING, Assistant Director BRUCE M. BEARDSLEY, Associate Director RAYMOND L. TEED, Assistant Director UYLESS D. BLACK, Assistant Director GLENN L. CUMMINS, Assistant Director ROBERT J. ZEMEL, Assistant Director DIVISION OF FEDERAL RESERVE BANK OPERATIONS DIVISION OF PERSONNEL JAMES R. KUDLINSKI, Director WALTER ALTHAUSEN, Assistant Director DAVID L. SHANNON, Director BRIAN M. CAREY, Assistant Director JOHN R. WEIS, Assistant Director HARRY A. GUINTER, Assistant Director CHARLES W. WOOD, Assistant Director LORIN S. MEEDER, Assistant Director OFFICE OF THE CONTROLLER JOHN KAKALEC, Controller EDWARD T. MULRENIN, Assistant Controller DIVISION OF SUPPORT SERVICES DONALD E. ANDERSON,Director JOHN L. GRIZZARD, Associate Director WALTER W. KREIMANN, Associate Director JOHN D. SMITH, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 72 Federal Reserve Bulletin • February 1979 FOMC and Advisory Councils FEDERAL OPEN MARKET COMMITTEE G. William Miller, Chairman Paul A. Volcker, Vice Chairman Ernest T. Baughman J. Charles Partee Henry C. Wallich Philip E. Coldwell Nancy H. Teeters Mark H. Willes David P. Eastburn Willis J. Winn Murray Altmann, Secretary Richard G. Davis, Associate Economist Norm and R. V. Bernard, Assistant Secretary Edward C. Ettin, Associate Economist Edward G. Guy, Deputy General Counsel Peter M. Keir, Associate Economist Robert E. Mannion, Assistant General Counsel James L. Kichline, Associate Economist Stephen H. Axilrod, Economist John Paulus, 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. Stern light, Deputy Manager for Domestic Operations Scott E. Pardee, Deputy Manager for Foreign Operations FEDERAL ADVISORY COUNCIL Henry S. Woodbridge, first district Roger E. Anderson, Seventh District Walter B. Wriston, second district Clarence C. Barksdale, Eighth District William B. Eagleson, Jr., third district Richard H. Vaughan, Ninth District Merle E. Gilliand, Fourth District J. W. McLean, Tenth District J. Owen Cole, Fifth District James D. Berry, Eleventh District Frank A. Plummer, Sixth District Chauncey E. Schmidt, Twelfth District Herbert V. Prochnow, Secretary William J. Korsvik, Associate Secretary CONSUMER ADVISORY COUNCIL William D. Warren, Los Ar igeles, California, Chairman Marcia A. Hakala, Omaha Nebraska, Vice Chairman Roland E. Brandel, San Francisco, California Percy W. Loy, Portland, Oregon James L. Brown, Milwaukee, Wisconsin R. C. Morgan, El Paso, Texas Mark E. Budnitz, Boston, Massachusetts Florence M. Rice, New York, New York John G. Bull, Fort Lauderdale, Florida Ralph J. Rohner, Washington, D. C. Robert V. Bullock, Frankfort, Kentucky Raymond J. Saulnier, New York, New York Carl Felsenfeld, New York, New York Henry S. Schechter, Washington, D. C. Jean A. Fox, Pittsburgh, Pennsylvania E. G. Schuhari, Amarillo, Texas Richard H. Holton, Berkeley, California Blair C. Shick, Cambridge, Massachusetts Edna DeCoursey Johnson, Baltimore, Mary- Thomas R. Swan, Portland, Maine land Anne Gary Taylor, Alexandria, Virginia Richard F. Kerr, Cincinnati, Ohio Richard A. Van Winkle, Salt Lake City, Utah Robert J. Klein, New York, New York Richard D. Wagner, Simsbury, Connecticut Harvey M. Kuhnley, Minneapolis, Minnesota Mary W. Walker, Monroe, Georgia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 73 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 Robert M. Solow Frank E. Morris Robert P. Henderson James A. Mcintosh NEW YORK* 10045 Robert H. Knight Paul A. Volcker Boris Yavitz Thomas M. Timlen Buffalo 14240 Frederick D. Berkeley 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 Arnold R. Weber 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 E. Elberson 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 William H. Martin, Jr. Hiram J. Honea Jacksonville 32203 Copeland D. Newbern Charles B. East Miami 33152 Castle W. Jordan F. J. Craven, Jr. Nashville 37203 Cecelia Adkins Jeffrey J. Wells New Orleans 70161 Levere C. Montgomery 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 F. Thompson Donald L. Henry Memphis 38101 Frank A. Jones, Jr. L. Terry Britt MINNEAPOLIS 55480 Stephen F. Keating Mark H. Willes William G. Phillips Thomas E. Gainor 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 Gerald D. Hines Robert H. Boy kin El Paso 79999 A. J. Losee Fredric W. Reed Houston 77001 Gene M. Woodfin J. Z. Rowe San Antonio 78295 Pat Legan 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 84125 Wendell J. Ashton 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 at Oriskany, 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. Remiteral Reserve System, Washington, D.C. 20551. Where tance from foreign residents should be drawn on a U.S. a charge is indicated, remittance should accompany bank. (Stamps and 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, $.85 each. ANNUAL REPORT. SURVEY OF CHANGES IN FAMILY FINANCES. 1968. 321 pp. $1.00 each; 10 or more to one address, $.85 FEDERAL RESERVE BULLETIN. Monthly. $20.00 per year or $2.00 each in the United States, its posses- each. sions, Canada, and Mexico; 10 or more of same REPORT OF THE JOINT TREASURY-FEDERAL RESERVE issue to one address, $18.00 per year or $1.75 STUDY OF THE U.S. GOVERNMENT SECURITIES MARKET. 1969. 48 pp. $.25 each; 10 or more to each. Elsewhere, $24.00 per year or $2.50 each. one address, $.20 each. BANKING AND MONETARY STATISTICS, 1914-1941. JOINT TREASURY-FEDERAL RESERVE STUDY OF THE (Reprint of Part 1 only) 1976. 682 pp. $5.00. GOVERNMENT SECURITIES MARKET: STAFF STUD- BANKING AND MONETARY STATISTICS, 1941-1970. IES—PART 1. 1970. 86 pp. $.50 each; 10 or more 1976. 1,168 pp. $15.00. to one address, $.40 each. PART 2. 1971. 153 pp. ANNUAL STATISTICAL DIGEST, 1971-75. 1976. 339 pp. and PART 3. 1973. 131 pp. Each volume $1.00; $4.00 per copy for each paid subscription to Fed- 10 or more to one address, $.85 each. eral Reserve Bulletin. All others, $5.00 each. OPEN MARKET POLICIES AND OPERATING PROCE- ANNUAL STATISTICAL DIGEST, 1972-76. 1977. 388 pp. DURES—STAFF STUDIES. 1971. 218 pp. $2.00 $10.00 per copy. each; 10 or more to one address, $1.75 each. ANNUAL STATISTICAL DIGEST, 1973-77. 1978. 361 pp. REAPPRAISAL OF THE FEDERAL RESERVE DISCOUNT $12.00 per copy. MECHANISM. Vol. 1. 1971. 276 pp. Vol. 2. 1971. FEDERAL RESERVE CHART BOOK. Issued four times a 173 pp. Vol. 3. 1972. 220 pp. Each volume $3.00; year in February, May, August, and November 10 or more to one address, $2.50 each. Subscription includes one issue of Historical Chart THE ECONOMETRICS OF PRICE DETERMINATION CON- Book. $7.00 per year or $2.00 each in the United FERENCE, October 30-31, 1970, Washington, D.C. States, its possessions, Canada, and Mexico. Else- 1972. 397 pp. Cloth ed. $5.00 each; 10 or more where, $10.00 per year or $3.00 each. to one address, $4.50 each. Paper ed. $4.00 each; HISTORICAL CHART BOOK. Issued annually in Sept. 10 or more to one address, $3.60 each. Subscription to Chart Book includes one issue. FEDERAL RESERVE STAFF STUDY: WAYS TO MODERATE $1.25 each in the United States, its possessions, FLUCTUATIONS IN HOUSING CONSTRUCTION . Canada, and Mexico; 10 or more to one address, 1972. 487 pp. $4.00 each; 10 or more to one $1.00 each. Elsewhere, $1.50 each. address, $3.60 each. LENDING FUNCTIONS OF THE FEDERAL RESERVE CAPITAL MARKET DEVELOPMENTS. Weekly. $15.00 per BANKS. 1973. 271 pp. $3.50 each; 10 or more year or $.40 each in the United States, its possesto one address, $3.00 each. sions, Canada, and Mexico; 10 or more of same IMPROVING THE MONETARY AGGREGATES (Report of the issue to one address, $13.50 per year or $.35 each. Advisory Committee on Monetary Statistics). Elsewhere, $20.00 per year or $.50 each. 1976. 43 pp. $1.00 each; 10 or more to one SELECTED INTEREST AND EXCHANGE RATES—WEEKLY address, $.85 each. SERIES OF CHARTS. Weekly. $15.00 per year or ANNUAL PERCENTAGE RATE TABLES (Truth in Lend- $.40 each in the United States, its possessions, ing—Regulation Z) Vol. I (Regular Transactions). Canada, and Mexico; 10 or more of same issue 1969. 100 pp. Vol. II (Irregular Transactions). to one address, $13.50 per year or $.35 each. 1969. 116 pp. Each volume $1.00, 10 or more Elsewhere, $20.00 per year or $.50 each. of same volume to one address, $.85 each. THE FEDERAL RESERVE ACT, as amended through De- FEDERAL RESERVE MEASURES OF CAPACITY AND CAcember 1976, with an appendix containing provi- PACITY UTILIZATION. 1978. 40 pp. $1.75 each, sions of certain other statutes affecting the Federal 10 or more to one address, $1.50. each. Reserve System. 307 pp. $2.50. THE BANK HOLDING COMPANY MOVEMENT TO 1978: REGULATIONS OF THE BOARD OF GOVERNORS OF THE A COMPENDIUM. 1978. 289 pp. $2.50 each, 10 FEDERAL RESERVE SYSTEM or more to one address, $2.25 each. PUBLISHED INTERPRETATIONS OF THE BOARD OF GOV- IMPROVING THE MONETARY AGGREGATES: STAFF ERNORS, as of June 30, 1978. $7.50. PAPERS. 1978. 170 pp. $4.00 each, 10 or more INDUSTRIAL PRODUCTION—1976 EDITION. 1977. 304 to one address, $3.75 each. pp. $4.50 each; 10 or more to one address, $4.00 1977 CONSUMER CREDIT SURVEY. 1978. 119 pp. $2.00 each. each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Board Publications A 75 CONSUMER EDUCATION PAMPHLETS Reprint (Short pamphlets suitable for classroom use. Multiple copies available without charge.) (Except for Staff Papers, Staff Studies, and some leading articles, most of the articles reprinted do not CONSUMER HANDBOOK TO CREDIT PROTECTION LAWS exceed 12 pages.) THE EQUAL CREDIT OPPORTUNITY ACT AND . . . AGE THE EQUAL CREDIT OPPORTUNITY ACT AND . . . MEASURES OF SECURITY CREDIT. 12/70. CREDIT RIGHTS IN HOUSING REVISION OF BANK CREDIT SERIES. 12/71. THE EQUAL CREDIT OPPORTUNITY ACT AND . . . ASSETS AND LIABILITIES OF FOREIGN BRANCHES OF DOCTORS, LAWYERS, SMALL RETAILERS, AND U.S. BANKS. 2/72. OTHERS WHO MAY PROVIDE INCIDENTAL CREDIT BANK DEBITS, DEPOSITS, AND DEPOSIT TURNOVER— THE EQUAL CREDIT OPPORTUNITY ACT AND . REVISED SERIES. 7/72, WOMEN YIELDS ON NEWLY ISSUED CORPORATE BONDS. 9/72. FAIR CREDIT BILLING RECENT ACTIVITIES OF FOREIGN BRANCHES OF U.S. A GUIDE TO FEDERAL RESERVE REGULATIONS BANKS. 10/72. HOW TO FILE A CONSUMER CREDIT COMPLAINT REVISION OF CONSUMER CREDIT STATISTICS. 10/72. IF YOU BORROW TO BUY STOCK ONE-BANK HOLDING COMPANIES BEFORE THE 1970 IF YOU USE A CREDIT CARD AMENDMENTS. 12/72. TRUTH IN LEASING YIELDS ON RECENTLY OFFERED CORPORATE BONDS. U.S. CURRENCY 5/73. RATES ON CONSUMER INSTALMENT LOANS. 9/73. WHAT TRUTH IN LENDING MEANS TO YOU NEW SERIES FOR LARGE MANUFACTURING CORPORA- TIONS. 10/73. STAFF 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. THE STRUCTURE OF MARGIN CREDIT. 4/75. Summaries Only Printed in the Bulletin NEW STATISTICAL SERIES ON LOAN COMMITMENTS AT SELECTED LARGE COMMERCIAL BANKS. 4/75. (Limited supply of mimeographed copies of full text RECENT TRENDS IN FEDERAL BUDGET POLICY. 7/75. available upon request for single copies.) RECENT DEVELOPMENTS IN INTERNATIONAL FINANCIAL STRUCTURE AND PERFORMANCE STUDIES IN BANKING: MARKETS. 10/75. A SUMMARY AND EVALUATION, by Stephen A. MINNIE: A SMALL VERSION OF THE MIT-PENN-SSRC Rhoades. Dec. 1977. 45 pp. ECONOMETRIC MODEL, Staff Economic Study by AN ANALYSIS OF FEDERAL RESERVE ATTRITION SINCE Douglas Battenberg, Jared J. Enzler, and Arthur 1960, by John T. Rose. Jan. 1978. 44 pp. M. Havenner. 11/75. PROBLEMS IN APPLYING DISCRIMINANT ANALYSIS IN AN ASSESSMENT OF BANK HOLDING COMPANIES, Staff CREDIT SCORING MODELS, by Robert A. Eisenbeis. Economic Study by Robert J. Lawrence and Sam- Jan. 1978. 28 pp. uel H. Talley. 1/76. EXTERNAL CAPITAL FINANCING REQUIREMENTS OF INDUSTRIAL ELECTRIC POWER USE. 1/76. COMMERCIAL BANKS: 1977-81, by Gerald A. Han- REVISION OF MONEY STOCK MEASURES. 2/76. weck and John J. Mingo. Feb. 1978. 34 pp. SURVEY OF FINANCE COMPANIES, 1975. 3/76. MORTGAGE BORROWING AGAINST EQUITY IN EXISTING REVISED SERIES FOR MEMBER BANK DEPOSITS AND HOMES: MEASUREMENT, GENERATION, AND IM- AGGREGATE RESERVES. 4/76. PLICATIONS FOR ECONOMIC ACTIVITY, by David F. INDUSTRIAL PRODUCTION—1976 Revision. 6/76. Seiders. May 1978. 42 pp. FEDERAL RESERVE OPERATIONS IN PAYMENT MECHA- THE BEHAVIOR OF MEMBER BANK REQUIRED RESERVE NISMS: A SUMMARY. 6/76. RATIOS AND THE EFFECTS OF BOARD ACTION, RECENT GROWTH IN ACTIVITIES OF U.S. OFFICES OF 1968-77, by Thomas D. Simpson. July 1978. 39 BANKS. 10/76. pp. NEW ESTIMATES OF CAPACITY UTILIZATION: MANU- FOOTHOLD ACQUISITIONS AND BANK MARKET STRUC- FACTURING AND MATERIALS. 11/76. TURE, by Stephen A. Rhoades and Paul Schweit- BANK HOLDING COMPANY FINANCIAL DEVELOPMENTS zer, July 1978. 8 pp. IN 1976. 4/77. INTEREST RATE CEILINGS AND DISINTERMEDIATION, by SURVEY OF TERMS OF BANK LENDING—NEW SERIES. Edward F. McKelvey. Sept. 1978. 105 pp. 5/77. THE RELATIONSHIP BETWEEN RESERVE RATIOS AND THE COMMERCIAL PAPER MARKET. 6/77. THE MONETARY AGGREGATES UNDER RESERVES CONSUMPTION AND FIXED INVESTMENT IN THE ECO- AND FEDERAL FUNDS RATE OPERATING TARGETS, NOMIC RECOVERY ABROAD. 10/77. by Kenneth J. Kopecky. Dec. 1978. 58 pp. RECENT DEVELOPMENTS IN U.S. INTERNATIONAL TIE-INS BETWEEN THE GRANTING OF CREDIT AND TRANSACTIONS. 4/78. SALES OF INSURANCE BY BANK HOLDING COMPA- THE FEDERAL BUDGET IN THE 1970's. 9/78. NIES AND OTHER LENDERS, by Robert A. Eisenbeis SUMMARY MEASURES OF THE DOLLAR'S FOREIGN EXand Paul R. Schweitzer. Feb. 1978. 75 pp. CHANGE VALUE. 10/78. SURVEY OF TIME AND SAVINGS DEPOSITS AT ALL COM- Printed in Full in the Bulletin MERCIAL BANKS, JULY 1978. 11/78. REDEFINING THE MONETARY AGGREGATES. 1/79. Staff Studies shown under "Reprints. " Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

76 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 (See 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 Reserve Banks (See Interest rates) (See also Foreigners) Discounts and advances by Reserve Banks (See Loans) Banks for cooperatives, 35 Dividends, corporate, 37 Bonds (See also U.S. Government securities): New issues, 36 EMPLOYMENT, 46, 47 Yields, 3 Euro-dollars, 27 Branch banks: Assets and liabilities of foreign branches of U.S. FARM mortgage loans, 41 banks, 56 Farmers Home Administration, 41 Liabilities of U.S. banks to their foreign Federal agency obligations, 4, 11, 12, 13, 34 branches, 23 Federal and Federally sponsored credit agencies, 35 Business activity, 46 Federal finance: Business expenditures on new plant and Debt subject to statutory limitation and equipment, 38 types and ownership of gross debt, 32 Business loans (See Commercial and industrial Receipts and outlays, 30, 31 loans) Treasury operating balance, 30 Federal Financing Bank, 30, 35 Federal funds, 3, 6, 18, 20, 21, 22, 27, 30 CAPACITY utilization, 46 Federal home loan banks, 35 Capital accounts: Federal Home Loan Mortgage Corp., 35, 40, 41 Banks, by classes, 16, 17, 19, 20 Federal Housing Administration, 35, 40, 41 Federal Reserve Banks, 12 Federal intermediate credit banks, 35 Central banks, 68 Federal land banks, 35, 41 Certificates of deposit, 23, 27 Federal National Mortgage Assn., 35, 40, 41 Commercial and industrial loans: Federal Reserve Banks: Commercial banks, 15, 18, 23, 26 Condition statement, 12 Weekly reporting banks, 20, 21, 22, 23, 24 Discount rates (See Interest rates) Commercial banks: U.S. Government securities held, 4, 12, 13, 32, 33 Assets and liabilities, 3, 15-19, 20-23 Federal Reserve credit, 4, 5, 12, 13 Business loans, 26 Federal Reserve notes, 12 Commercial and industrial loans, 24, 26 Federally sponsored credit agencies, 35 Consumer loans held, by type, 42, 43 Finance companies: Loans sold outright, 23 Assets and liabilities, 39 Number, by classes, 16, 17, 19 Business credit, 39 Real estate mortgages held, by type of holder and Loans, 20, 21, 22, 42, 43 property, 41 Paper, 25, 27 Commercial paper, 3, 24, 25, 27, 39 Financial institutions, loans to, 18, 20-22 Condition statements (See Assets and liabilities) Float, 4 Construction, 46, 50 Flow of funds, 44, 45 Consumer instalment credit, 42, 43 Foreign: Consumer prices, 46, 51 Currency operations, 12 Consumption expenditures, 52, 53 Corporations: Deposits in U.S. banks, 4, 12, 19, 20, 21, 22 Exchange rates, 68 Profits, taxes, and dividends, 37 Trade, 55 Security issues, 36, 65 Foreigners: Cost of living (See Consumer prices) Claims on, 60, 61, 66, 67 Credit unions, 29, 42, 43 Liabilities to, 23, 56-59, 64-67 Currency and coin, 5, 16, 18 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

A 165 Federal Reserve Bulletin • February 1979 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. Government 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 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. Government 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 (See also Securities): Insured or guaranteed by United States, 40, 41 New issues, 36 Savings and loan associations, 29 Prices, 28 MANUFACTURING: TAX receipts, Federal, 31 Capacity utilization, 46 Time deposits, 3, 10, 13, 15, 16, 17, 19, 20, 21, Production, 46, 49 22, 23 Margin requirements, 28 Trade, foreign, 55 Member banks: Treasury currency, Treasury cash, 4 Assets and liabilities, by classes, 16, 17, 18 Treasury deposits, 4, 12, 30 Borrowings at Federal Reserve Banks, 5, 12 Treasury operating balance, 30 Number, by classes, 16, 17, 19 Reserve position, basic, 6 UNEMPLOYMENT, 47 Reserve requirements, 9 U.S. balance of payments, 54 Reserves and related items, 3, 4, 5, 15 U.S. Government balances: Mining production, 49 Commercial bank holdings, 19, 20, 21, 22 Mobile home shipments, 50 Member bank holdings, 15 Monetary aggregates, 3, 15 Treasury deposits at Reserve Banks, 4, 12, 30 Money and capital market rates (See Interest rates) U.S. Government securities: Money stock measures and components, 3, 14 Bank holdings, 16, 17, 18, 20, 21, 22, 29, Mortgages (See Real estate loans) 32, 33 Mutual funds (See Investment companies) Dealer transactions, positions, and financing, 34 Mutual savings banks, 3, 10, 20-22, 29, 32, 33, 41 Federal Reserve Bank holdings, 4, 12, 13, 32, 33 Foreign and international holdings and NATIONAL banks, 17, 19 transactions, 12, 32, 64 National defense outlays, 31 Open market transactions, 11 National income, 52 Outstanding, by type of security, 32, 33 Nonmember banks, 17, 18, 19 Ownership, 32, 33 Rates in money and capital markets, 3, 27 OPEN market transactions, 11 Yields, 3 Utilities, production, 49 PERSONAL income, 53 Prices: VETERANS Administration, 40, 41 Consumer and wholesale, 46, 51 Stock market, 28 WEEKLY reporting banks, 20-24 Prime rate, commercial banks, 26 Wholesale prices, 46 Production, 46, 48 Profits, corporate, 37 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

78 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories T { vm \l bP Minneapolis$ x Detroit MftlI Chicago jSa/t Lake City Omaha* UTcuW' Louisvil Kansas City t. Louis tfichm?* 'harlot \Oklahoma City. ^mphisSashjilU )s^ge/es I® > Attle Rock Birminghai %lanta Dallas® 12s*** Houston j San Antonio January 1978 SiSl®i®?! HAWAII BIHIB^WB 0 LEGEND — Boundaries of Federal Reserve Districts ® Federal Reserve Bank Cities Boundaries of Federal Reserve Branch • Federal Reserve Branch Cities Territories Federal Reserve Bank Facility Q Board of Governors of the Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis