Federal Reserve Bulletin, 1980-06

June 1980 FEDERAL RESERVE BULLETIN Recent Financial Behavior of Households The Depository Institutions Deregulation and Monetary Control Act of 1980 Foreign Exchange Operations: Interim Report Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BULLETIN (USPS 351-150). Controlled Circulation Post­ age Paid at Richmond, Virginia. POSTMASTER: Send address changes to Pub­ lications Services, MP-510, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. A copy of the Federal Reserve Bulletin is sent to each member bank without charge; member banks desiring additional copies may secure them at a special $10.00 annual rate. The regular subscription price in the United States and its possessions, and in Bolivia, Canada, Chile, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, Guatemala, Haiti, Republic of Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, El Salvador, Uruguay, and Venezuela is $20.00 per annum or $2.00 per copy; elsewhere, $24.00 per annum or $2.50 per copy. Group subscriptions in the United States for 10 or more copies to one address, $1.75 per copy per month, or $18.00 for 12 months. The Bulletin may be obtained from Publications Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551, and remittance should be made payable to the order of the Board of Governors of the Federal Reserve System in a form collectible at par in U.S. currency. (Stamps and coupons are not accepted.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

V olum e 66 □ N um ber 6 □ June 1980 FEDERAL RESERVE BULLETIN Board of Governors of the Federal Reserve System Washington, D.C. Publications Com m ittee 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 staff publications committee. This committee is responsible for opinions expressed except in official statements and signed articles. Direction for the art work is provided by Peter G. Thomas. 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 437 R ecen t F inancial Beha vior 465 Governor J. Charles Partee discusses the o f H ou seh olds generally positive condition of the financial system; given the risks and uncertainties Borrowing by households slowed during that are present, however, he notes that the 1979, particularly after midyear, and con­ Board supports a recently submitted legis­ tinued to decelerate in early 1980. lative proposal that would authorize inter­ state acquisitions of failed depository insti­ 444 The D epositor y In stitu tion s tutions in certain emergency situations, D eregu lation and before the Senate Committee on Banking, M onetar y C o n tro l A ct o f 1980 Housing, and Urban Affairs, May 21, 1980. This article discusses the act and the vari­ ous titles of Public Law 96-221. 468 Chairman Volcker comments on a bill that would authorize the Board to impose mar­ 454 T reasury and F ederal R eserve gin requirements on a broad spectrum of O perations: Interim R eport “financial” instruments both in the cash Early in the period, the exchange markets markets and in the futures or forward deliv­ were caught up in various crosscurrents, ery markets; he notes that margin require­ but dollar rates in the exchange markets ments are only one possible approach to had steadied by the end of April. preventing abuses in these markets, before the Senate Committee on Banking, Hous­ 458 In du strial P rodu ction ing, and Urban Affairs, May 29, 1980. Output declined about 2.1 percent in May. 471 Governor Nancy H. Teeters discusses 459 Statem en ts to C ongress steps that might be taken to meet the credit needs of minority communities in the inner Chairman Paul A. Volcker presents the city, including the establishment of special views of the Board on the proposed “Fed­ purpose development banks and expansion eral Reserve Modernization Act;” he says of the programs of the Neighborhood Rein­ that the net result of the legislation could vestment Corporation, before the Sub­ be to dilute both the independence of judg­ committee on Domestic Monetary Policy ment and the regional attributes of the Fed­ of the House Committee on Banking, Fi­ eral Reserve System, before the Sub­ nance and Urban Affairs, May 29, 1980. committee on Domestic Monetary Policy of the House Committee on Banking, Fi­ nance and Urban Affairs, May 15, 1980. 475 John E. Ryan, Director of the Board’s Di­ vision of Banking Supervision and Regula­ 462 Chairman Volcker discusses some of his tion, provides information on the examina­ impressions and reactions to the recent tion procedures of the Federal Reserve in events in the silver market with emphasis monitoring compliance with the require­ on the implications of such events for pub­ ments of the Bank Secrecy Act in light of lic policy in terms of regulating the futures the possibility of flows of narcotics-related market, before the Subcommittee on Con­ monies through banks in South Florida, be­ servation and Credit of the House Com­ fore the Senate Committee on Banking, mittee on Agriculture, May 21, 1980. Housing, and Urban Affairs, June 6, 1980. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

478 Announcements Committee’s view, M-2 should grow at an annual rate of about 63/4 percent over the Appointment of Lyle E. Gramley as a first half, and expansion of bank credit member of the Board of Governors. should slow in the months ahead to a pace Change in the discount rate. compatible with growth over the year as a whole within the range of 6 to 9 percent Compliance with the 1980 requirements of agreed upon. the Bank Holding Company Act. On May 6, the Committee modified the Modifications in the credit restraint pro­ domestic policy directive adopted at this gram. meeting by voting to reduce the lower limit of the range for the federal funds rate to Amendment to Regulation E to remove the IOV2 percent. requirement for receipts given at the point of sale in electronic transfers to identify the 490 M em bership o f th e B oard o f type of account being charged. G overnors o f th e Actions under the Truth in Lending Simpli­ F ederal R eserve S ystem , 1913-80 fication and Reform Act. List of appointive and ex officio members. Nominations to Consumer Advisory Council. 492 L egal D evelopm ents Changes in interest rate ceilings on sav­ Amendments to Regulations D, E, and Z; ings. amendments to the credit restraint pro­ gram; regulations of the Depository Institu­ Publication of consumer pamphlet, “Alice tions Deregulation Committee; various in Debitland.” rules and bank holding company and bank Proposed Regulation D designed to carry merger orders; and pending cases. out the provisions for reserve requirements in the Monetary Control Act of 1980; pro­ posed revisions in rules governing exten­ Al Financial and B usiness Statistics sions of credit through the discount win­ A3 Domestic Financial Statistics dow to carry out provisions of the A46 Domestic Nonfinancial Statistics Monetary Control Act of 1980. A54 International Statistics Changes in Board staff. A69 Special Tables Admission of three state banks to member­ A73 G uide to T abular P resen tation ship in the Federal Reserve System. and S ta tistica l R eleases 484 R ecord o f P o licy A ction s o f th e A74 B oard o f Go vern ors and S ta ff F ederal O pen M arket Com m ittee At its meeting on April 22, 1980, the Com­ A76 F ederal O pen M arket Com m ittee mittee agreed that open market operations and S taff; A dvisory C ouncils in the period until the next meeting should continue to be directed toward ex­ A ll Federal Reserve Banks, pansion of reserve aggregates consistent Branches, and Offices with growth over the first half of 1980 at annual rates of Alh percent for M-1A and 5 A78 F ederal R eserve B oard percent for M-1B, or somewhat less, pro­ P ublications vided that in the intermeeting period the weekly average federal funds rate re­ A83 Index to S ta tistica l Tables mained within a range of 13 to 19 percent. Consistent with this short-run policy, in the A85 Map of Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Recent Financial Behavior of Households This article was prepared by Charles Luckett of declined in early 1980. On the other hand, the the Board's Division of Research and Statistics. total net worth of households, including tangible assets, is estimated to have reached a record lev­ The pace of borrowing by households slowed el at the end of 1979, even after allowance for during 1979, particularly after midyear, and con­ inflation in prices of consumer goods and serv­ tinued to decelerate in early 1980. The downturn ices. in home mortgage flows appeared moderate in The comparatively illiquid condition of the view of the period’s historically high interest household sector balance sheet has led to some rates; the sharpest cutbacks in net borrowing by concern about the ability of households to cope households occurred in the consumer installment with continued declines in real income. Through credit component. the early part of 1980, the number of delinquent At the same time, households directed a small­ loans indicated no great deterioration in the abili­ er proportion of their current income into savings ty of households to meet debt obligations. How­ than in prior years and maintained less of their ever, economic activity dropped sharply as the total accumulated wealth in financial assets. second quarter began, and the implications for Households also restructured their holdings of fi­ consumer spending and the quality of mortgage nancial assets in response to sizable interest rate and consumer credit outstanding remain unclear. differentials, shifting away from savings deposits subject to fixed interest rate ceilings toward as­ sets with market-determined yields. Household Borrowing The financial net worth of households—finan­ cial assets less liabilities—was about unchanged Households added nearly $145 billion to their during 1979, after adjustment for inflation and combined mortgage and installment debt during changes in the size of the population, and then 1979, about $5 billion less than their net borrow- Sources of funds to households in mortgage and consumer credit markets—1979 Home mortgage1 Consumer installment Total Holder Billions Percentage Billions Percentage Billions Percentage of distri­ of distri­ of distri­ dollars bution dollars bution dollars bution All sources............................................ 109.0 100 35.5 100 144.5 100 Savings and loans......................... 38.5 35 2.0 6 40.5 28 Commercial banks...................... 20.1 18 13.4 38 33.5 23 Mortgage pools2............................ 24.0 22 (3) (3) 24.0 17 Credit unions................................ .5 (3) 2.2 6 2.7 2 Finance and mortgage companies................................ .3 (3) 14.0 39 14.3 10 Mutual savings banks................... 2.4 2 -.3 (3) 2.1 1 Federal and related agencies ................................... 9.4 9 (3) (3) 9.4 7 Others............................................ 13.8 13 4.1 11 17.9 12 1. Home mortgage credit figures include a small amount of con­ of which may have been purchased by the institutions shown struction loans to other than households. separately and reported among their nonmortgage assets. 2. Pools of mortgages backing passthrough securities guaranteed 3. Less than $0.1 billion or 0.5 percent. by the Government National Mortgage Association, Federal Home Note. Data exclude some minor types of credit to consumers, Loan Mortgage Corporation, or Farmers Home Administration, some such as noninstallment loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

438 Federal Reserve Bulletin □ June 1980 1. Housing credit and prices Percent Net borrowing is at seasonally adjusted annual rates, from loans. The average monthly payment is on new conventional the household sector of the Federal Reserve quarterly flow of loans closed during the month and partly reflects mortgage funds accounts. Mortgage interest rates at a sample of sav­ amounts and interest rates determined earlier. The average ings and loans are for new commitments on conventional home price is the Census Bureau series for new homes sold. ing the year before. By the first quarter of 1980, eased to below 7 percent in the first quarter of aggregate expansion of these types of debt had this year. In April, consumer installment credit fallen to an annual rate of $120 billion, and a fur­ contracted on a seasonally adjusted basis for the ther drop appeared in progress during the second first time since early 1975. quarter. Both curtailed supplies of funds from lenders and reduced demands for credit by households have contributed to the deceleration of credit growth. Home Mortgage Markets The rate of expansion in home mortgage debt moderated during the second half of 1979, then During 1978 and 1979, developments affecting slowed further in the opening quarter of 1980. credit supply were important determinants of the Toward the end of last year, households were in­ pattern of growth in mortgage credit. The avail­ creasing their overall mortgage indebtedness at ability of home mortgage credit was buttressed in an annual rate of 13 percent, compared with 15 mid-1978 when financial institutions were autho­ percent during 1978 and the first half of 1979. As rized to issue savings instruments on which of­ the cost of mortgage credit climbed steeply in the fering yields were tied to prevailing short-term first quarter of 1980, the annual rate of mortgage market interest rates. These so-called money debt expansion slipped below 12 percent. market certificates (MMCs) and other new liabil­ Short- and intermediate-term installment bor­ ity powers enabled the nonbank thrift institu­ rowing of households slowed more during 1979 tions, which specialize in home mortgage lend­ than did mortgage borrowing. From the unusu­ ing, to continue to compete for funds in an ally strong 18 to 20 percent rate during 1977-78, environment of rising interest rates. By the end growth in consumer installment credit out­ of last year, outstanding MMCs at all types of standing dropped to 15 percent during the first depository institutions had grown to $265 billion, half of 1979. By the fourth quarter, the annual 60 percent of which had been issued by savings rate of expansion was down to 8 percent, and it and loan associations and mutual savings banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Recent Financial Behavior of Households 439 Meanwhile, several states revised their usury Facing highly uncertain future inflows of funds statutes to raise or abolish fixed ceilings for mort­ and a large backlog of mortgage commitments, gage interest rates or to establish floating ceilings lenders cut back substantially on new com­ tied to market rates. With funds more readily mitments in late 1979. Interest rates on new com­ available to mortgage lenders than in past peri­ mitments rose 5 percentage points within the 7ods of high and rising interest rates, and with month period through April 1980, and some insti­ ceilings on lending rates relaxed in some cases, tutions temporarily closed their loan windows. mortgage flows remained near the large 1978 vol­ On the demand side, during the first three ume throughout most of last year. (In December quarters of last year, homebuyers appeared only 1979, preemptive federal legislation eliminated marginally deterred by a gradual rise in interest state interest rate ceilings on virtually all residen­ rates on new mortgage commitments, to about 11 tial first mortgage loans.) percent, even though such quotes were then rec­ Several other factors have contributed to the ord highs. The willingness of potential home­ availability of mortgage funds in recent years. buyers to pay unprecedented mortgage interest Federally guaranteed mortgage passthrough rates apparently reflected expectations that securities have provided individual borrowers home prices would continue to increase rapidly with indirect access to the broader capital mar­ and that interest rates were unlikely to retreat. kets, and government programs have shielded However, the upward trend of average home some homebuyers from the full impact of high prices slowed markedly in late 1979, and interest mortgage market rates. For instance, below-mar- rates surged. Many would-be homebuyers un­ ket interest rates have been made available to doubtedly could not afford mortgages with the some homebuyers by state and local government larger monthly payments occasioned by the high­ agencies that borrowed for that purpose at tax- er interest rates, or could not meet the qualifying exempt rates through special mortgage revenue standards of lenders for such large-payment bonds. The Department of Housing and Urban loans. Average monthly payments on conven­ Development approved the insurance by the tional first mortgages closed on new homes, for Federal Housing Administration of graduated- example, rose from about $525 in early October pay ment mortgages, which can reduce debt serv­ to nearly $650 in early April. ice payments in the initial months of the contract In mid-April, money market yields plunged as by as much as a fourth. Moreover, some diver­ suddenly as they had surged earlier, and rates on sified lenders, such as life insurance companies, new mortgage commitments soon retreated from channeled larger shares of their funds into mort­ their peaks. However, they were still around 13 gage assets during most of 1978 and 1979 because percent in early June, well above year-earlier of the unusually large spread between conven­ quotes. Even though the drop in rates on new tional home mortgage rates and bond yields. That mortgage commitments since April will reduce spread reflected in large part the relatively strong upward pressures on average monthly payments, demand for mortgage credit by households. such developments as rising unemployment, By late last year, however, after the Federal shorter workweeks, and continued inflation have Reserve’s October 6 policy actions, financial mar­ probably reduced the willingness and ability of kets came under greater pressure, and mortgage some households to take on new, large financial markets became more taut. As interest rates obligations. climbed, MMCs, maturing in ever-larger quan­ tities, had to be rolled over at considerably higher cost. In addition, outflows from fixed-ceiling ac­ counts accelerated as yields elsewhere grew Consumer Credit Markets more attractive in comparison. Competition from money market mutual funds—whose assets ex­ In consumer credit markets last year, the combi­ panded from $11 billion at the beginning of 1979 nation of rising money costs for lenders, statutory to $61 billion in April 1980—intensified the diver­ rate ceilings, and attractive yields on alternative sion of funds from mortgage-investing depository investments began to undercut credit availabili­ institutions. ty. Consumer loan rates, which had edged up Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

440 Federal Reserve Bulletin □ June 1980 during 1978, advanced more sharply in 1979— then limited to 12 percent, these institutions were about 1 to IV2 percentage points on average— unable to compete aggressively for deposit and continued higher in 1980. funds, and many had to curtail lending sharply. Such rate increases, though sizable by historic (On March 31, 1980, the ceiling rate on loans by norms, probably had little direct discouraging ef­ federal credit unions was lifted to 15 percent by fect on installment borrowing. An increase of 1 the Depository Institutions Deregulation and percentage point on a four-year car loan, for in­ Monetary Control Act of 1980.) As a result, cred­ stance, would typically boost monthly payments it unions—the only element of strength in con­ only $3 to $4. Moreover, in many cases, rate in­ sumer credit markets during the 1974-75 credit creases were minimized or forestalled altogether downswing—have been the weakest lender by the state rate ceilings. Thus suppliers of con­ group since mid-1979. Consumer loans out­ sumer credit tended to curb credit growth by standing at credit unions have contracted on a nonrate means, such as tighter loan-approval seasonally adjusted basis in each month since standards or higher downpayment requirements. September 1979. Only in one month before last In some cases, banks introduced annual user fees year had such a decline occurred. on credit-card accounts, and several banks al­ Commercial banks, which accounted for half tered repayment terms. of net installment lending to consumers during Some depository institutions were hampered the last 10 years, also have curbed consumer in their consumer lending activities by severe lending sharply. As rates paid on certificates of shortages of funds that developed during 1979. deposit and other bank liabilities rose sub­ Credit unions in particular were constrained by stantially during the first quarter of this year, and large outflows from regular share accounts, only as returns on business lending and other invest­ part of which were recouped by increased is­ ments climbed, banks became considerably less suance of higher-yielding time certificates. With willing to make consumer loans at the com­ loan rates at federal and most state credit unions paratively low maximum rates generally permit­ ted by state law. In the first four months of 1980, 2. Consumer installment credit finance companies—mainly the subsidiaries of Billions of dollars the auto manufacturers—were the principal net 60 suppliers of consumer credit. NET BORROWING The deceleration of consumer credit growth since early last year reflected gradually declining demand for credit as well as restricted supply, Sales of domestically produced automobiles be­ gan to weaken in the spring of 1979, although auto credit then was still readily available. Sud­ den and substantial increases in gasoline prices, along with spot gas shortages and fear of worsen­ ing supplies, damped demand for the larger, less FINANCE RATES fuel-efRcient cars. As car sales slackened, the de­ Commercial banks mand for auto credit weakened, too. Household borrowing unrelated to car purchases, by con­ trast, continued fairly strong until the fourth quarter of 1979. Demand for consumer credit weakened further in the early months of 1980. Real disposable in­ come had changed little for more than a year. Rapidly increasing prices had raised sub­ Net borrowing is at seasonally adjusted annual rates. Fi­ stantially the proportion of disposable income nance rates represent the most common rate charged by sur­ committed to necessities during 1979, leaving a veyed banks on 12-month personal cash loans and on 36-month new-car loans. progressively smaller share available for discre- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Recent Financial Behavior of Households 441 3. Nondiscretionary household outlays small-denomination savings instruments carrying relative to DPI market yields has probably moderated somewhat Percent Percent the flight of households from financial assets. As inflation has surged, housing has accounted for an increasing proportion of the total assets of the household sector. This shift in asset structure has reflected in part heavier investment in hous­ ing and also appreciation in the market value of homes and land. Increases in home prices gener­ ally have outstripped price increases for con­ sumer goods and services in recent years, and the total financial and tangible net worth of households has risen even when adjusted for price inflation and population growth. Many households have borrowed against the appreci­ ated equity value of their homes in recent years, Nondiscretionary expenditures are Federal Reserve staff estimates thus temporarily liquefying part of their tangible based on Commerce Department data for outlays on food, fuel assets. Loan proceeds earmarked for future use oil and coal, and housing services, and fractions of household operating costs, gasoline and oil, and “other” services. Debt and held in financial assets would preserve this repayments, as defined in the note to chart 6, include both mort­ liquidity, but the proceeds from such borrowing gage and consumer installment debt. DPI is disposable personal income. often have financed home improvements or pur­ chases of major durable goods and services. tionary spending, which often involves credit fi­ The reduced liquidity of household balance nancing. As 1980 unfolded, concern about the sheets may imply greater limitations on the ca­ possibility of recession began to mount, and pacity of some households to adjust to changing many households may have reached a level of in­ circumstances in an economic downswing, de­ debtedness at which further increases in borrow­ spite the sector’s higher total net worth. But so ing appeared unpalatable, notwithstanding the far the pattern of delinquency rates and bad-debt inflation-induced incentives to borrow that were still present. 4. Net Worth of household sector Thousands of 1972 dollars PER CAPITA Balance Sheet Adjustments Because of persistent rapid inflation during the past few years, the household sector has altered the composition of its balance sheet. Borrowing was encouraged in part because the after-tax in­ terest costs facing consumers increased less than the pace of inflation during much of the period, and consumers foresaw repayment of loans in sharply depreciated dollars. Similarly, rapid in­ flation motivated households to limit holdings of financial assets in favor of tangible assets— especially real property—that might be expected to appreciate in value. That motivation may be particularly strong when yields on financial as­ Financial net worth is total financial assets less total liabilities of the household sector, from the Federal Reserve quarterly flow sets are prevented by artificial constraints from of funds accounts and converted to a per capita basis. Total adjusting fully to the declining value of the dollar. household net worth is financial net worth plus consumer du­ rable goods, residential structures, land, and certain other tangible In the last two years, however, development of assets. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

442 Federal Reserve Bulletin □ June 1980 5. Delinquency rates densome on households may have stimulated bankruptcy declarations since the revised law took effect last October. One amendment pro­ tects some classes of assets from liquidation, no­ tably equity of up to $7,500 in a home and $1,200 in a car; previously, state protections, which were often less liberal, had pertained. The ratio of annual mortgage and installment debt repayments to current disposable personal income, sometimes used as an indicator of aggre­ gate debt burden of households, reached a record high in the third quarter of 1979. This ratio was only moderately above previous highs posted in the early 1970s, however, and has eased off re­ cently as additions to the stock of debt have sub­ sided. Moreover, several factors impair com­ parisons in levels of this ratio over time. A trend toward longer payback periods, particularly for Consumer loan delinquency rates at commercial banks are the auto loans, has tended to restrain the growth of proportions of each loan category past due 30 days or more, repayments relative to income while boosting the from the American Bankers Association; delinquent mortgages at savings and loans are those past due 60 (Jays or more, from total stock of debt ultimately payable. Use of the Federal Home Loan Bank Board. credit cards as a convenient substitute for cash or check payments, on the other hand, has ele­ vated measured repayments of installment debt. chargeoffs on mortgage and consumer credit has Between one-third and one-half of cardholders shown only limited evidence of deterioration in employ credit cards mainly for convenience as a the ability of households to repay their debts. Af­ transactions medium, paying bills in full without ter four years of relative stability, delinquencies incurring a finance charge. All bank-card extenon closed-end consumer credit at commercial banks climbed steadily during 1979 from a firstquarter low, but turned back down in the first 6. Debt repayments relative to DPI quarter of 1980 to about the average level of the past four years. Such a decline in delinquencies is uncommon at a time of widespread signs of re­ cession. In the past, delinquencies on installment loans generally have risen for two quarters in ad­ vance of a business cycle peak and then contin­ ued to increase as a recession developed. Delin­ quencies on mortgage loans at savings and loan associations meanwhile have held near record lows since early 1979. Bank-card delinquencies, in contrast, have ris­ en continuously since the first quarter of last year, to approach previous recession highs, and some mortgage delinquency series have neared historic highs. Also, the number of individuals de­ claring bankruptcy, though quite a small propor­ Consumer debt repayments include prepayments as well as scheduled payments of principal and interest on installment loans. tion of households with debt, has risen sharply Mortgage debt repayments are Federal Reserve staff estimates of since early last year. Changes in federal legisla­ scheduled payments of principal and interest on debt secured by one-unit homeowner properties. DPI is disposable personal in­ tion that tend to make bankruptcy less bur­ come. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Recent Financial Behavior of Households 443 sions and liquidations, however, are included in lation that would permit, without penalty, the consumer credit aggregates. seasonal fluctuation and some initial underlying growth. This approach allowed lending institu­ tions considerable flexibility regarding the specif­ ic means used to slow credit growth. It contrast­ Credit Controls Program ed with controls programs during the Korean and Second World War periods, in which the Board On March 14, 1980, the Federal Reserve Board had established maximum loan maturity and min­ announced a four-part program to curb the imum downpayment requirements for a wide va­ growth of credit, as a facet of the administra­ riety of loans. tion’s broad anti-inflation effort pursuant to Consumer installment credit contracted at a an executive order of the President issued un­ seasonally adjusted annual rate of 8 percent in der authority of the Credit Control Act of 1969. April, the first full month under credit controls, The President’s action was taken at a time when compared with increases of 5 percent in March inflation, as measured by the major price in­ and 7 percent for the first quarter as a whole. The dexes, had reached extraordinary rates, and extent to which the specific consumer credit con­ fears of a continued rapid rise in prices had led to trols, as well as the Board’s guidelines for overall marked deterioration of conditions in the bond loan expansion at banks and finance companies, markets, threatening still more serious dis­ contributed to the decline in outstanding credit ruption of economic and financial activities. The in April is unclear, although the suddenness of Board viewed the new credit restraint package as the shift from positive to negative growth sug­ supplementary to its basic policy of slowing gests that the program did have some impact. money and credit growth through its traditional In the first few weeks after controls were an­ tools. The program was designed to ensure that nounced, many commercial banks and some re­ the burden of general credit restraint would not tailers took steps to restrict the availability of fall unduly upon particular sectors of the econo­ consumer credit, most often by adopting more my, and that available funds would not be di­ stringent credit-approval standards. Many banks verted to unproductive or speculative uses. instituted user fees on credit cards, lowered max­ One element of the Board’s program was de­ imum borrowing limits, or stopped issuing cards signed to limit the growth of certain types of altogether. As noted earlier, some banks had consumer credit—all open-end credit, such as taken such measures before March 14 in re­ credit-card debt, and closed-end credit either sponse to sharply higher costs of funds, but the unsecured or secured by collateral not being announcement of controls seemed to trigger a purchased with the proceeds of the credit. stepup in such actions. Retailers most commonly Selected types of closed-end credit, such as tightened credit terms through higher lending auto loans, were exempted from this part of the standards and by raising minimum monthly pay­ program in view of the evident weakness in de­ ment requirements. However, many retailers re­ mands for certain consumer durable goods. ported that consumers had cut back voluntarily To discourage overly expansive growth in cov­ on credit-card use after the controls program ered consumer credit, the Board required that was invoked, and that applications for new ac­ creditors maintain a non-interest-bearing deposit counts had fallen sharply. with the Federal Reserve equal to 15 percent of In view of the broadly curtailed use of credit in any increase in outstanding covered credit above March and April, the Board modified its program a base amount. Originally, the base amount was of credit controls on May 22. Under the con­ to have been the amount of covered credit out­ sumer credit controls, the deposit requirement standing on March 14, but the Board sub­ on increases in covered credit was lowered to sequently provided for an optional base calcu­ llh percent from 15 percent. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

444 The Depository Institutions Deregulation and Monetary Control Act of 1980 This article was prepared by Charles R. McNeill all institutions that accepted deposits subject to of the Board's Legal Division, with the dis­ withdrawal on demand. In recent years, the cussion of title VI by Denise M. Rechter of the Board has emphasized the need for universal re­ Division of Consumer and Community Affairs. serve requirements in order to meet the problem of attrition in membership and weakening of the The Depository Institutions Deregulation and Board’s monetary reserve base. Monetary Control Act of 1980 was approved by Since 1973 when the proposed Financial Insti­ President Carter on March 31, 1980, as Public tutions Act was first considered, under the lead­ Law 96-221. This legislation was described by ership of Senator Thomas J. McIntyre, the Board Senator William A. Proxmire, chairman of the has consistently supported a gradual phaseout of Senate Committee on Banking, Housing, and Ur­ interest rate ceilings coupled with broadened as­ ban Affairs, as the most significant banking legis­ set powers for savings and loan associations and lation since the passage of the Federal Reserve mutual savings banks. Act of 1913, and by Representative Henry S. Reuss, chairman of the House Committee on Banking, Finance and Urban Affairs, as the Title /, Monetary Control Act of most significant package of financial legislation 1980 since the 1930s. The legislation resolves many problems pertaining to the structure of financial Reserve Requirements institutions that the Congress has been consid­ ering for some time. Universal reserve requirements are imposed on The uneven and inequitable level of reserve re­ all depository institutions by the Monetary Con­ quirements applicable to similar accounts in vari­ trol Act of 1980. Depository institutions are re­ ous financial institutions has been a matter of quired, under regulations of the Board, to main­ concern to the Board of Governors for many tain a reserve of 3 percent against transaction years. According to the Board’s Fifty-First An­ accounts of $25 million or less, and a reserve nual Report (1964), “The interests of equity and ranging between 8 and 14 percent with an initial efficiency would best be served if all commercial ratio of 12 percent for that portion of total trans­ banks were obligated to observe the same re­ action accounts in excess of $25 million. In addi­ serve standards and if, at the same time, such tion, each depository institution is required to banks were afforded access to the Federal Re­ maintain reserves against nonpersonal time de­ serve Bank discount window.” The Report also posits in an amount ranging from zero to 9 per­ stated, “To permit commercial banks a choice as cent with an initial ratio of 3 percent. Depository to the reserve requirement they will meet cannot institutions are defined, for purposes of the act, be defended in principle.” In 1965 the Board re­ to include commercial banks, mutual savings peated this recommendation and called attention banks, savings banks, savings and loan associa­ to the dangers to effective monetary policy aris­ tions, and credit unions, if they are federally in­ ing from accelerated withdrawals from member­ sured or eligible for federal insurance. Reserve ship in the Federal Reserve System. When insti­ requirements must be uniformly applied to all tutions other than commercial banks were first transaction accounts at all depository institu­ authorized to have transaction accounts, the tions; for nonpersonal time deposits they may Board broadened its recommendation to include vary by the maturity of such deposits. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

445 Beginning December 31, 1981, the Board is re­ would have been required if the initial ratios for quired each year to index the $25 million break­ the basic reserves had been in effect. point on transaction accounts of individual banks The supplemental reserve may be imposed on­ by issuing a regulation that would increase or de­ ly after consultation with the Federal Deposit In­ crease that figure by 80 percent of the percentage surance Corporation, the Federal Home Loan increase or decrease in the total transaction ac­ Bank Board, and the National Credit Union Ad­ counts of all depository institutions between ministration Board. In addition, a report must be June 30 of that year and June 30 of the preceding promptly transmitted to the Congress stating the year. basis for the determination to exercise the au­ Upon a finding by five or more members of the thority to impose the supplemental reserve. Af­ Board that extraordinary circumstances require ter a supplemental reserve has been imposed for such action, the Board, after consultation with a period of one year or more, the Board must the Congress may, for a period of 180 days, im­ review and determine the need for continued pose reserve requirements on any liability of de­ maintenance of supplemental reserves and trans­ pository institutions outside the limitations on ra­ mit annual reports to the Congress regarding the tios and types of liabilities otherwise prescribed. need for continuing the supplemental reserves. These reserves may be extended for additional The supplemental reserves are to be main­ periods of 180 days by the affirmative action of tained by the Federal Reserve Banks in an Earn­ five members of the Board in each case. A report ings Participation Account. That account shall on the exercise of this authority and the reasons receive earnings to be paid by the Federal Re­ for it must be promptly transmitted to the Con­ serve Banks during each calendar quarter at a gress. rate not more than the rate earned on the secu­ rities portfolio of the Federal Reserve System Supplemental Reserves. The Board is also giv­ during the previous calendar quarter. The Board en the authority, upon the affirmative vote of not may prescribe rules and regulations concerning less than five members, to impose a supplemen­ the payment of these earnings to depository insti­ tal reserve requirement on every depository in­ tutions maintaining the supplemental reserves. stitution of not more than 4 percent of its total transaction accounts. This supplemental reserve Reserves Related to Foreign Obligations or may be imposed only if the following conditions Assets. The Monetary Control Act requires for­ are satisfied: eign branches, subsidiaries, and international banking facilities of nonmember depository insti­ 1. The sole purpose of the supplemental re­ tutions to maintain reserves to the same extent serve is to increase the amount of reserves to a required by the Board of foreign branches, sub­ level essential for the conduct of monetary pol­ sidiaries, and international banking facilities of icy. member banks. In addition, the Board may im­ 2. The supplemental reserve is not imposed pose reserves on net balances owed by domestic for the purpose of reducing the cost burdens re­ offices of depository institutions to directly re­ sulting from the basic reserve requirements. lated foreign offices and balances owed to foreign 3. The supplemental reserve is not imposed offices of unrelated depository institutions, loans for the purpose of increasing the amount of bal­ to U.S. residents by overseas offices of a deposi­ ances needed for clearing purposes. tory institution having one or more offices in the 4. At the time the supplemental reserve is im­ United States, and assets acquired by a foreign posed, the total amount of basic reserves is not office of a depository institution in the United less than the amount of reserves that would be States from its domestic offices. required if the initial ratios for the basic reserves The basic reserve requirements are not appli­ were in effect. cable to deposits payable only outside the 50 U.S. Any supplemental reserve is required to be ter­ states and the District of Columbia. minated at the close of the first 90-day period during which the average amount of reserves re­ Form of Reserves. Reserves may be main­ quired is less than the amount of reserves that tained under regulations of the Board in balances Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

446 Federal Reserve Bulletin □ June 1980 at the Federal Reserve Bank of which the deposi­ ment as if it had been a member on that date. tory institution is a member or at which it main­ Consistent with the guidance offered by the Con­ tains an account. Reserves of nonmember de­ gress as to the interpretation of this provision, pository institutions may be held at a corre­ the Board has concluded that the date of with­ spondent depository institution holding re­ drawal from membership for a state member quired reserves at a Federal Reserve Bank, a bank will be determined by the date on which the Federal Home Loan Bank, or the National Cred­ Federal Reserve Bank received notice of the de­ it Union Administration Central Liquidity Facil­ cision of the bank’s board of directors (and ity if such reserves are passed through to a Fed­ shareholders when required by state law) to eral Reserve Bank. The Board may, by withdraw from membership. For national banks, regulation or order that is applicable to all de­ the date of withdrawal is the date on which the pository institutions, permit them to maintain all national bank received a state charter. Recogniz­ or a portion of their required reserves in the form ing that individual circumstances may have of vault cash. Vault cash may be used to satisfy caused delay, the Board will consider evidence any supplemental reserve requirement, except from a former member bank that it made an that such vault cash shall be excluded from any unambiguous and irrevocable decision to with­ computation of earnings in the Earnings Partici­ draw from membership before July 1, 1979, and pation Account. Balances maintained to meet re­ thus is entitled to an eight-year phase-in of re­ serve requirements may be used to satisfy liquid­ quired reserves. A bank that withdrew from ity requirements imposed under other provisions membership prior to March 31, 1980, may pre­ of federal or state law. sent evidence for review by the Board that it made such an unambiguous, irrevocable decision to Transitional Adjustments. Reserve require­ withdraw from membership before July 1, 1979. ment provisions under the Monetary Control Act The Board has also waived reserve require­ of 1980 generally are effective on September 1, ments for the period from March 31, 1980, 1980. On June 4, the Board issued for public through August 27, 1980, in the case of banks comment proposed regulations designed to carry that withdrew from the System (other than by out the reserve requirement provisions of the merger or consolidation) on or after July 1, 1979, act. The act provides for an eight-year phase-in of and ceased maintaining reserves before March reserve requirements for nonmember depository 31, 1980. The Board has recognized that, despite institutions. During the first twelve-month peri­ this waiver, some banks may incur significant od, the amount of reserves required would be hardships by being required to maintain full re­ one-eighth of the total and would increase by serve balances at the end of the waiver period, one-eighth in each of the following seven years. and the Board will consider granting limited ex­ This eight-year phase-in would not apply to any tensions beyond that date in extraordinary cir­ category of accounts or deposits authorized by cumstances. A former member bank that placed federal law after the date of enactment of the its balances, prior to March 31, 1980, in assets Monetary Control Act, such as negotiable order that have declined significantly in value and that of withdrawal (NOW) accounts in those states in cannot be converted to cash before August 28, which they were not previously authorized. Oth­ 1980, without incurring significant losses, may er transition provisions provide for a four-year request a limited extension of time by application phase-in of changes in reserve requirements for to the Board by July 15, 1980. member banks and a four-year phase-in of changes Banks that withdrew from membership be­ in reserve requirements for a bank that becomes cause of mergers or consolidations into a non­ a member bank during the four-year period begin­ member bank on or after July 1, 1979, will be re­ ning March 31, 1980. quired to maintain reserves in the same manner The act provides, effective March 31, 1980, as a member bank on the proportion of their de­ that any bank that was a member bank on July 1, posits attributable to the former member bank. 1979, and withdrew from membership between In a merger or consolidation on or after March that date and March 30, 1980, shall be required to 31, 1980, between a member and a nonmember maintain reserves beginning on the date of enact­ bank that was engaged in business on July 1, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Depository Institutions Act 447 1979, when the surviving bank is a member bank, necessary or desirable to enable the Board to only the amount of deposits of the nonmember monitor and control monetary and credit aggre­ bank immediately preceding the date of the gates. Member banks and other depository insti­ merger will be eligible for an eight-year phase-in tutions whose reserve requirements exceed zero of reserves. are to make their reports directly to the Board. A special transition provision specifies that for The reports of other depository institutions are nonmember, state chartered depository institu­ to be made through the appropriate federal su­ tions engaged in business outside the continental pervisory agency in the case of federally insured limits of the United States on and after August 1, institutions and through the state officer or agen­ 1978, the reserve requirements will not be ap­ cy designated by the Board for other depository plicable until January 1, 1986, and then will be institutions. The Board is to avoid both the impo­ phased in over an eight-year period. sition of unnecessary burdens on reporting insti­ An exemption from reserve requirements is tutions and the duplication of other reporting re­ given to any financial institution that is organized quirements. The Board is given authority to solely to do business with other financial institu­ classify depository institutions and to impose dif­ tions, does not do business with the general pub­ ferent reporting requirements on the various lic, and is owned primarily by the financial insti­ classes of such institutions. Unless otherwise re­ tutions with which it does business. In addition, quired by law, any data provided to any depart­ the Board is required to waive the reserve re­ ment, agency, or instrumentality of the United quirement in individual cases when a federal su­ States pursuant to other reporting requirements pervisory authority waives a liquidity require­ shall be made available to the Board. ment and requests the Board to waive the reserve requirement. Pricing of Services Discounts and Borrowing. Any depository in­ stitution holding reservable transaction accounts The Monetary Control Act requires the Board to or nonpersonal time deposits is entitled to the publish for comment a set of pricing principles same discount and borrowing privileges as mem­ and a proposed schedule of fees for Federal Re­ ber banks. This provision became effective on serve Bank services by September 1, 1980, and March 31, 1980. In administering the discount to begin putting such a schedule into effect by and borrowing privileges, the Federal Reserve September 1, 1981. System is required to take into consideration the The following services are covered by the fee special needs of savings and other depository schedule: institutions for access to discount and borrowing 1. Currency and coin services of a nongovern­ facilities consistent with their long-term asset mental nature. portfolios and the sensitivity of such institu­ 2. Check-clearing and collection. tions to trends in the national money markets. On 3. Wire transfer. June 10, 1980, the Board announced for public 4. Automated clearinghouse. comment proposed regulations relating to ac­ 5. Settlement. cess to the discount window by nonmember 6. Securities safekeeping. institutions. 7. Federal Reserve float. 8. Any new service that the Federal Reserve System offers, including, but not limited to, pay­ Reporting Requirements ment services to effectuate the electronic trans­ fer of funds. Significant changes have been made in the re­ In determining the pricing schedule, the Board porting requirements for depository institutions is required to observe the following principles: for monetary policy purposes. The act requires 1. All services covered by the fee schedule are all depository institutions, at intervals prescribed to be explicitly priced. by the Board, to make such reports of their liabili­ 2. Federal Reserve Bank services covered by ties and assets as the Board determines to be the fee schedule are to be made available to non­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

448 Federal Reserve Bulletin □ June 1980 member depository institutions priced at the on deposits and accounts discourage persons same fees as to member banks. However, non­ from saving money, create inequities for depos­ members may be required to hold balances suf­ itors, impede the ability of depository institu­ ficient for clearing purposes and be subject to tions to compete for funds, and have not any other terms that the Board may determine achieved their purpose of providing an even flow are applicable to member banks. of funds for home mortgage lending, and that all 3. Over the long run, fees are to be established depositors, particularly those with modest sav­ on the basis of all direct and indirect costs ac­ ings, are entitled to receive a market rate of re­ tually incurred in providing the Federal Reserve turn on their savings as soon as it is economically services, except that the Board shall give due re­ feasible for depository institutions to pay such a gard to competitive factors and the provision of rate. an adequate level of services nationwide. The purpose of title II is to provide for the 4. Interest on items credited prior to collec­ orderly phaseout and the ultimate elimination of tion shall be charged at the current federal funds limitations on the maximum rates of interest and rate. dividends that may be paid on deposits and ac­ Reductions are to be made in the operating counts by depository institutions by extending budgets of the Federal Reserve Banks commen­ the authority to impose such limitations for six surate with any actual or projected decline in the years subject to specific standards designed to in­ volume of services they provide. These savings sure a phaseout to market rates of interest. are to be paid into the U.S. Treasury. To effect the purposes of title II, a Depository Institutions Deregulation Committee is estab­ lished comprising the Secretary of the Treasury, Miscellaneous Amendments the Chairman of the Board of Governors of the Federal Reserve System, the Chairman of the Miscellaneous amendments consist of the fol­ Board of Directors of the Federal Deposit Insur­ lowing: ance Corporation, the Chairman of the Federal 1. Collateral will no longer be required behind Home Loan Bank Board, and the Chairman of Federal Reserve notes held in the vaults of the the National Credit Union Administration Federal Reserve Banks. Board, as voting members, and the Comptroller 2. The kinds of eligible collateral for Federal of the Currency as a nonvoting member. To this Reserve notes are expanded to include obliga­ committee is transferred all the statutory author­ tions of, or fully guaranteed as to principal and ity of the Federal Reserve Act, the FDIC Act, interest by, a foreign government or agency of and the Federal Home Loan Bank Act to pre­ a foreign government, as well as any other as­ scribe rules governing the payment of interest sets that may be purchased by Reserve Banks. and dividends and the establishment of classes of 3. A member bank is permitted to keep on de­ deposits or accounts, including limitations on the posit with any depository institution that is maximum rate of interest and dividends that may authorized to have access to the discount win­ be paid, and the authority in section 102 of Public dow a sum in excess of 10 percent of its own Law 94-200 to administer the differential be­ paid-up capital and surplus. tween ceiling rates for thrift institutions and com­ 4. The penalty rate on Federal Reserve ad­ mercial banks on certain categories of deposits. vances to depository institutions secured by “in­ The Deregulation Committee is required to meet eligible” paper is repealed. publicly at least quarterly and all of its meetings are to be conducted in conformity with the Gov­ ernment in the Sunshine Act. Action by the com­ Title II, Depository Institutions mittee requires a majority vote of the voting Deregulation Act o f 1980 members of the committee. The statutory au­ thorities that have been conferred on the Deregu­ The Congress based its enactment of the Deposi­ lation Committee and its members may not be tory Institutions Deregulation Act of 1980 on delegated. findings that limitations on interest rates payable The act directs the Deregulation Committee as Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Depository Institutions Act 449 rapidly as economic conditions warrant to pro­ 3. Findings concerning disintermediation of vide for the orderly phaseout and the ultimate savings deposits from insured institutions to un­ elimination of maximum rates of interest and insured money market innovators paying market dividends that may be paid on deposits and ac­ rates to savers. counts. This goal may be achieved by the gradual 4. Recommendations for legislative and ad­ increase in limitations applicable to all existing ministrative actions necessary to maintain the categories of accounts, by the complete elimina­ economic viability of depository institutions. tion of the limitations applicable to particular cat­ All preexisting rules with respect to deposit in­ egories of accounts, by the creation of new cate­ terest rate ceilings remain in effect until repealed, gories of accounts not subject to limitations or amended, or superseded by a regulation of the with limitations set at current market rates, by Deregulation Committee. Compliance with the any combination of those methods, or by any regulations of the committee shall be enforced other method. The committee is directed to work by the appropriate federal financial institutions toward providing all depositors with a market regulatory agency as to the depository institutions rate of return on their savings with due regard for under its regulatory jurisdiction. the safety and soundness of depository institu­ As of March 31, 1986, the various authorities tions, and also to increase to market rates as to impose interest rate ceilings on deposits by soon as feasible all limitations on the maximum any of the federal financial institutions regulatory rates of interest and dividends that may be paid agencies are repealed; all authorities that had on deposits and accounts. The Deregulation been transferred to the Deregulation Committee Committee may not increase such limitations become ineffective and the Deregulation Com­ above market rates during the six-year period be­ mittee shall cease to exist. ginning March 31, 1980. The act provides targets to assist the com­ mittee in meeting these statutory objectives. These targets specify that the committee shall Title III, Consumer Checking vote, no later than September 30, 1981, on Account Equity Act of 1980 whether to increase limitations on the maximum rates applicable to passbook and similar savings The Consumer Checking Account Equity Act of accounts by at least lU percent. And the com­ 1980 authorizes the continuation of authority for mittee shall vote no later than March 31, 1983, banks to provide automatic transfer services 1984, 1985, and 1986, on whether to increase the from savings to checking accounts; for the estab­ limitations on the maximum rates applicable to lishment of remote service units by savings and all categories of deposits and accounts by at least loan associations for the purpose of crediting and 72 percent. The committee may adjust ceilings debiting savings accounts, of crediting payments applicable to all categories of deposits to rates on loans, and the disposition of related financial that are higher or lower than the specified tar­ transactions; and for the offering of share draft gets. accounts by federally insured credit unions. Each member of the Deregulation Committee The act also extends nationwide the authority is to make an annual report to the Congress on of depository institutions to offer NOW accounts. the economic viability of depository institutions NOW accounts may consist solely of funds in that is to include the following: which the entire beneficial interest is held by 1. An assessment as to whether the removal of one or more individuals or by an organization any differential between the rates paid by banks operated primarily for religious, philanthropic, and those paid by thrift institutions will adverse­ charitable, educational, or other similar purposes ly affect housing finance or the viability of the and not operated for profit. This authority is ef­ thrift industry. fective December 31, 1980. 2. Recommendations for measures to encour­ As of March 31, 1980, the insurance of ac­ age saving, provide for the equitable treatment counts of federally insured banks, savings and of small savers, and ensure a steady and adequate loan associations, and credit unions is increased flow of funds to thrift institutions and housing. from $40,000 to $100,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

450 Federal Reserve Bulletin □ June 1980 Among other amendments to the Federal istered with the Securities and Exchange Com­ Credit Union Act, the loan rate ceiling for federal mission if the company’s portfolio is restricted to credit unions is increased from 12 to 15 percent. investments that savings and loan associations The National Credit Union Administration may make directly. Board is given authority to establish higher inter­ The authority to make real estate loans is ex­ est ceilings for a period not to exceed 18 months, panded by removing any geographical lending re­ after consultation with the appropriate com­ striction, providing for a 90 percent loan-to-value mittees of the Congress, the Department of the limit in place of the existing $75,000 limit, and Treasury, and the federal financial institutions removing the first-lien restriction on residential regulatory agencies, if that board determines that real estate loans. The authority to make acquisi­ money market interest rates have risen over the tion, development, and construction loans is also preceding six-month period and that prevailing expanded. interest rate levels threaten the safety and sound­ Federally chartered savings and loan associa­ ness of individual credit unions as evidenced by tions are authorized to offer credit-card services adverse trends in liquidity, capital, earnings, or and to exercise trust and fiduciary powers. growth. A state stock savings and loan association is The Federal Home Loan Bank Board may au­ authorized to convert to a federal stock charter thorize the Federal Home Loan Banks to be provided that it existed in stock form for no less drawees of, and to engage in or to be agents for, than the four years preceding March 31, 1980. the collection and settlement of instruments Under regulations of the Federal Home Loan drawn on or issued by members of any Federal Bank Board, savings and loan associations are Home Loan Bank or institutions eligible for authorized to issue mutual capital certificates membership. A Federal Home Loan Bank is to that shall constitute a part of the general reserve make reasonable charges for clearing services and net worth of the issuing association. These consistent with the principles set forth in the mutual capital certificates would be subordinate Federal Reserve Act on pricing for services. A to savings accounts, saving certificates, and debt Federal Home Loan Bank may utilize the serv­ obligations but would be entitled to the payment ices of, or act as agent for or be a member of, a of dividends and may have a fixed or variable Federal Reserve Bank, clearinghouse, or other dividend rate. public or private financial institution or other Federal mutual savings banks are authorized agency in the exercise of clearing and settlement to make commercial, corporate, and business functions. loans, but not more than 5 percent of the assets The National Credit Union Administration of the bank may be so loaned and the loan may Board may authorize the Central Liquidity Facil­ be made only within the state where the bank is ity or its agent members to engage in the same located or within 75 miles of the bank’s home of­ collection and settlement function as that autho­ fice. rized for the Federal Home Loan Banks. Federal mutual savings banks are also autho­ rized to accept demand deposits in connection with a commercial, corporate, or business loan Title IV, Powers of relationship. Thrift Institutions The President is to establish an interagency and Miscellaneous Provisions task force consisting of the Secretary of the Treasury, the Secretary of Housing and Urban The Homeowners Loan Act is amended to au­ Development, and representatives of the Federal thorize various new investment authorities for Home Loan Bank Board, the Board of Gover­ federally chartered savings and loan associa­ nors of the Federal Reserve System, the Board tions. Such associations are authorized to invest of Directors of the Federal Deposit Insurance up to 20 percent of their assets in consumer Corporation, the Comptroller of the Currency, loans, commercial paper, and corporate debt and the National Credit Union Administration securities. They may also invest in shares or cer­ Board. This task force is to conduct a study and tificates of open-end investment companies reg­ to make recommendations regarding the options Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Depository Institutions Act 451 available to provide balance to the asset-liability District where the person making the loan is management problems inherent in the thrift port­ located. This preemption expires April 1, 1983, folio structure, the options available to increase or at an earlier date if the state expressly reinsti­ the ability of thrift institutions to pay market tutes a state usury ceiling. rates of interest in periods of rapid inflation and high interest rates, and the options available through the Federal Home Loan Bank System Other Loans and other federal agencies to assist thrift institu­ tions in times of economic difficulty. In order to prevent discrimination against state- After solicitation of views from consumer and chartered institutions, state usury ceilings are public interest groups, and also from business, preempted to permit insured state banks, labor, and state regulators of depository institu­ branches of foreign banks, insured savings and tions, the task force is to transmit its findings and loan associations, insured credit unions, and recommendations to the President and the Con­ small business investment companies to charge gress by June 30, 1980. interest on loans at a rate of 1 percent above the basic Federal Reserve discount rate. In addition, any state restrictions on the rate or Title V, State Usury Laws amount of interest that may be paid on deposits or accounts at depository institutions are elimi­ Mortgage Usury Laws nated. The provisions of a state constitution or law lim­ iting the rate or amount of interest, discount Title VI, Truth in Lending points, finance charges, or other charges are Simplification and Reform Act preempted with respect to loans, mortgages, and credit sales or advances made after March 31, The Truth in Lending Simplification and Reform 1980, that are secured by a first lien on resi­ Act (the simplification act) amends the Truth in dential real property, by a first lien on stock in a Lending Act of 1969. The main objective of the residential cooperative housing corporation, or earlier act, which is a credit-cost disclosure stat­ by a first lien on a residential manufactured home ute, is to provide consumers with important if the loan on the residential manufactured home shopping information that allows them to com­ is in compliance with consumer protection regu­ pare credit terms. lations of the Federal Home Loan Bank Board. The simplification act aims to increase con­ A state may take action reinstating usury limita­ sumer understanding and facilitate creditor com­ tions on mortgage loans if after April 1, 1980, and pliance with the provisions of the Truth in Lend­ before April 1, 1983, it adopts a law or certifies ing Act. The simplification act will go into effect that the voters of such state have voted in favor on April 1, 1982, but creditors may comply with of any provision, constitutional or otherwise, that its provisions once the Board adopts a revised states explicitly and by its terms that such state Regulation Z. On April 23, 1980, the Board in­ does not want the federal usury override to apply vited public comment on a revised Regulation Z to mortgage loans made in that state. and is to adopt a final version no later than April 1, 1981. The revised regulation results not only from the simplification act but also from Execu­ Business and Agricultural Loans tive Order 12044, issued on March 23, 1978, which directs each agency to review for improve­ State usury laws are preempted, in the case of ment all of its regulations. (See the discussion of business or agricultural loans in the amount of title VIII.) $25,000 or more, and a rate is established at not The simplification act reduces the number and more than 5 percent in excess of the discount detail of the Truth in Lending disclosures and rate, including any surcharge thereon, in effect at makes them more understandable for con­ the Federal Reserve Bank in the Federal Reserve sumers. It separates the disclosures from all oth­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

452 Federal Reserve Bulletin □ June 1980 er information and requires the use of simple dences. Finally, the simplification act directs the English descriptive phrases for key terms, such Board to compile and distribute information con­ as “annual percentage rate” and “finance cerning annual percentage rates for representa­ charge.” Also, the Board is required to issue tive types of nonsale credit on an experimental model forms and clauses that if used properly basis. will insulate creditors from civil liability. A credi­ tor’s exposure to civil liability is reduced be­ cause statutory penalties attach only to certain Title VII, Amendments to disclosures and creditors are given 60 days to the National Banking Laws remedy errors discovered after disclosures are provided. The simplification act authorizes the Under title VII a number of changes are made in Board and the other enforcement agencies to re­ the national banking laws relating to the author­ quire reimbursement to consumers when the ac­ ity of national banks and the operations of the tual annual percentage rate or finance charge ex­ Comptroller of the Currency. In addition, au­ ceeds that shown on the disclosure statement. thority is provided for the termination of the Na­ Other general highlights include the elimina­ tional Bank Closed Receivership Fund. tion of agricultural credit from coverage under The following amendments affect the Federal Truth in Lending. Consumers will be given dis­ Reserve System. closures earlier in certain mortgage transactions The Bank Holding Company Act is amended because creditors must make good-faith esti­ to permit the Federal Reserve Board to extend mates of all required disclosures within three the deadline for the divestiture of impermissible business days of a mortgage application. The real estate or real estate interests from December simplification act eliminates as a required dis­ 31, 1980, to December 31, 1982. Before granting closure the itemization of the amount financed, an extension, the Board shall consider whether although this itemization must be provided upon the company has made a good-faith effort to a consumer’s written request. Also, the com­ divest the real estate interests and whether the ponents of the finance charge will no longer be extension is necessary to avert substantial loss. itemized. The Comptroller is authorized, upon the Although the simplification act is primarily request of the Federal Reserve, to assign exam­ concerned with closed-end credit (such as mort­ iners to examine foreign operations of state gages and installment loans), it has also made member banks. some important changes in open-end credit (such The Douglas amendment of the Bank Holding as revolving charge accounts, credit cards, and Company Act (prohibiting a bank acquisition overdraft checking). For example, the sim­ outside of the holding company’s home state) is plification act streamlines for small creditors the amended to include a trust company within the rules for identifying transactions on periodic bill­ definition of a bank until October 1, 1981. This ing statements. It also permits creditors to send a new amendment prohibits the interstate acquisi­ summary of billing error rights and obligations tion of a trust company by a bank holding compa­ once rather than twice a year. ny for that period of time unless expressly The simplification act extends the right of re­ authorized by the law of the state in which the scission (the three-day cooling off period during company to be acquired is located. However, the which a consumer may cancel certain obliga­ prohibition does not apply to any acquisition tions) to transactions in which a security interest approved by the Board on or before March 5, is taken in a mobile home if the mobile home is 1980, if the trust company had opened for busi­ used as the consumer’s principal dwelling. The ness and was operating by that date. simplification act also eases the rescission re­ The Bank Holding Company Act is further quirements (for an experimental three-year peri­ amended by providing that the Board shall not od) for open-end credit plans involving advances follow any practice or policy in the considera­ that are secured by consumers’ principal resi­ tion of an application for the formation of a one- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Depository Institutions Act 453 bank holding company that would result in a possible. The federal financial regulatory rejection solely because the transaction involves agencies are to establish programs providing for a bank stock loan for a period of not more than periodic review of existing regulations to deter­ 25 years. However, this amendment does not mine whether those regulations achieve these six prohibit the Board from rejecting an application policies. Regulations not in accord with these solely because the other financial arrangements policies shall be revised. are considered unsatisfactory. The Board is to Periodic progress reports are to be made to the consider transactions involving bank stock loans banking committees of the House and Senate un­ to be used for the formation of a one-bank holding til title VIII is repealed on March 31, 1985. company having a maturity of 12 years or more on a case-by-case basis, and not to approve any transaction in which the Board believes the Title IX, Foreign Control of safety or soundness of the bank may be jeopar­ U.S. Financial Institutions dized. Until July 1, 1980, the Board of Governors of the Federal Reserve System, the Comptroller of the Title VIII, Financial Regulation Currency, the Board of Directors of the Federal Simplification Act of 1980 Deposit Insurance Corporation, and the Federal Home Loan Bank Board are prohibited from ap­ The provisions of the Financial Regulation Sim­ proving any application relating to the takeover plification Act of 1980 reflect the concern of the of any domestic financial institution by a foreign Congress that the regulations of the federal finan­ person. The term “takeover” is defined as mean­ cial regulatory agencies often impose costly, du­ ing the acquisition of a total of 5 percent or more plicative, and unnecessary burdens on both finan­ of an institution’s stock or assets. cial institutions and consumers. The act states The following exceptions are made to this pro­ that regulations should be simply and clearly hibition: written, should achieve legislative goals ef­ 1. The takeover is necessary to prevent the fectively and efficiently, and should not impose bankruptcy or insolvency of a domestic financial unnecessary costs and paperwork burdens on the institution. economy, on financial institutions, or on con­ 2. The application was initially submitted on sumers. or before March 5, 1980. Consistent with these findings, the law pro­ 3. The domestic financial institution has de­ vides that any regulation issued by a federal fi­ posits of less than $100 million. nancial regulatory agency shall, to the maximum 4. The application relates to a foreign person’s extent practicable, insure that (1) the need and intrafirm reorganization of its interests in a do­ purpose are clearly established; (2) meaningful mestic financial institution including an appli­ alternatives are considered; (3) compliance cation to establish a bank holding company pur­ costs, paperwork, and other burdens are mini­ suant to such reorganization. mized; (4) conflicts, duplication, and inconsisten­ 5. The application relates to a domestic finan­ cies with another agency’s regulations are to be cial institution that is already owned or con­ avoided if possible; (5) timely participation and trolled by a foreign person. comment by other agencies, financial institu­ 6. The domestic financial institution to be ac­ tions, and consumers are available; and (6) regu­ quired is a subsidiary of a bank holding company lations shall be as simple and as clearly written as under an order to divest by December 31, 1980. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

454 Treasury and Federal Reserve Foreign Exchange Operations: Interim Report This interim report, covering the period Febru­ had been tentative and bouts of selling pressure ary through April 1980, is the fifteenth of a series occasionally emerged. On two occasions when providing information on Treasury and System the dollar came on offer during the first two foreign exchange operations to supplement the weeks of the month the U.S. authorities inter­ regular series of semiannual reports that are vened, selling a total of $240.8 million equivalent usually issued each March and September. It of marks and $22.5 million equivalent of Swiss was prepared by Scott E. Pardee, Manager of francs. Most of these sales were financed out of Foreign Operations of the System Open Market balances of the Federal Reserve and the Trea­ Account and Senior Vice President in the For­ sury, but the sales of marks also entailed drawings eign Function of the Federal Reserve Bank of by the Federal Reserve in the amount of $115.4 New York. million equivalent under the swap line with the German Federal Bank. These operations raised Coming into the February-April period under re­ the System’s total mark swap debt to the Federal view, the exchange markets were caught up in Bank to a peak of $2,746.3 million equivalent. various crosscurrents. Market participants were With the economic outlook for the industrial troubled by the persistent rise in oil prices by the countries obscured by major uncertainties, mar­ Organization of Petroleum Exporting Countries ket participants increasingly focused on interest (OPEC), the rapidly moving events in Iran and Afghanistan, and the deterioration in U.S.-Sovi­ et relations. For the United States the higher 1. Foreign exchange operations under reciprocal currency arrangements, January 31-April 30, 1980 oil price appeared to add further to the massive oil import bill already expected for this year. Pro­ Millions of dollars equivalent; drawings, or repayments (-) posals for additional defense expenditures raised Federal Reserve System activity1 the prospect of an enlarged budget deficit, and Commit­ February Commit­ inflationary expectations showed signs of in­ Transactions with ments, through ments, Jan. 31, 1980 April 1980 Apr. 30, 1980 tensifying. But many of these developments raised difficult problems for other industrial Bank of France ............. 0 73.9 73.9 countries as well. The continuing rise in inter­ German Federal Bank .. 2,630.9 {_2 83li2} 2964 national oil prices threatened to add to uncom­ Total ................................... fortably large current-account deficits in Germa­ 2’630'9 |-2,838^| 37#'3 ny and Japan, among others, and to exacerbate Activity by foreign central banks and the BIS3 inflation generally. The political tensions both in February the Middle East and between the United States Bank drawing on Outstanding, through Outstanding, Federal Reserve System Jan. 31, 1980 April 1980 Apr. 30, 1980 and the Soviet Union were thought to be as seri­ ous for the economic and military security of Bank for International Settlements (against Western Europe and Japan as they were for the German marks)4 ,,. , 0 f 143*°1 0 U [-143.0] U United States. These various uncertainties made 1. Because of rounding, figures may not add to totals. Data are on traders especially cautious about taking positions a transaction-date basis. and making markets, thereby adding to exchange 2. Repayments include revaluation adjustments from swap re­ newals, which amounted to $0.8 million for drawings on the German rate volatility. Federal Bank renewed during the period. By February, the dollar had firmed somewhat 3. Data are on a value-date basis. 4. BIS drawings and repayments of dollars against European cur­ from the lows of early January, but the recovery rencies other than Swiss francs to meet temporary cash requirements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

455 rate developments here and abroad. The demand sures that included agreement by the Federal Re­ for money and credit in the United States in­ serve, the German Federal Bank, and the Swiss creased quite rapidly, as inflationary expec­ National Bank to cooperate in an effort to avoid tations mounted and as the domestic econo­ an excessive decline of the yen. For its part, the my appeared to be strong despite widespread Federal Reserve agreed to purchase yen in the forecasts of recession. Inflationary expectations New York market for its own account and to pro­ also gripped the longer-term financial markets, vide resources to the Bank of Japan if needed un­ and bond yields rose sharply. As part of the ef­ der the existing $5 billion swap arrangement. forts of the U.S. authorities to curb inflation, the In view of the continuing buildup of inflation­ Federal Reserve continued to adhere to the mon­ ary psychology and of strong credit demands in etary policy approach adopted last October 6, the United States, reports began to circulate that placing greater emphasis than before on the sup­ the U.S. authorities might impose credit controls ply of bank reserves and less emphasis on the as a supplement to the policy of monetary re­ federal funds rate in seeking to moderate the do­ straint. A scramble for funds ensued as business­ mestic growth of money and credit. With the Fed­ es attempted to secure lines of credit and as eral Reserve thus restraining the growth of bank banks sought to fund their commitments, thus reserves in the face of the sudden increase in de­ pushing up U.S. domestic and Eurodollar inter­ mand for money and credit in the United States, est rates further. As interest differentials favor­ short-term dollar interest rates began to rise able to the dollar progressively widened, the dol­ sharply. The Federal Reserve followed up by lar came into even greater demand in the raising the discount rate 1 percentage point to exchanges. Investors adjusted their portfolios, 13 percent in mid-February, but market rates commercial leads and lags swung heavily in the continued to climb. dollar’s favor, and OPEC members increasingly Interest rates abroad were also advancing but placed surplus funds in dollar-denominated not so sharply as in the United States, and funds rather than in foreign currency-denominated as­ began to be switched into dollars in response to sets. Professional and corporate borrowers, the increasingly favorable interest rate dif­ seeking an alternative to high-cost dollar financ­ ferentials. As the dollar thus came into demand ing, turned to money and capital markets abroad, in the exchanges, frequently in the form of large where interest rates had risen far less rapidly, buy orders, foreign central banks were quick to and converted their loan proceeds into dollars. intervene as sellers of dollars out of their own This turn of events evoked a vigorous re­ reserves. Inasmuch as these pressures occurred sponse abroad. By then the authorities in other during the normal trading hours abroad, the major countries were openly concerned that the Trading Desk’s activities in the New York mar­ sharp depreciations of their currencies in the ex­ ket for the account of the U.S. authorities were changes would add to domestic inflationary pres­ small, with purchases of $60 million equivalent of sures through higher prices for oil and other im­ marks on two occasions through early March. ports. Consequently, central banks of several Meanwhile, however, the U.S. authorities major countries stepped up their intervention in bought substantial amounts of marks from corre­ the exchanges. In addition, concern about infla­ spondents, mainly from the German Federal tion led many central banks to raise official inter­ Bank, and used those marks to reduce swap debt est rates, but money market rates for the dollar with the German Federal Bank. went up faster. In some cases, the authorities lib­ By March, dollar exchange rates had advanced eralized previous restrictions on capital inflows. by some 2lU percent against the German mark The authorities of several countries negotiated and other currencies within the European Mone­ actively with foreign official institutions, most tary System (EMS), V2 percent against the pound notably those from OPEC, to gain investments in sterling, and 5V4 percent against the yen, with their respective currencies. For their part the trading becoming increasingly one way. The Jap­ U.S. authorities continued to acquire marks, anese authorities were particularly concerned purchasing another $35 million equivalent in the about the heavy selling pressure on the yen, and market. These marks, together with $2,751.7 mil­ on March 2 they announced a package of mea­ lion equivalent purchased from correspondents Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

456 Federal Reserve Bulletin □ June 1980 since the beginning of the period, were used to for its own account as part of joint operations liquidate in full the Federal Reserve’s out­ with the Bank of Japan in the New York market. standing swap debt with the German Federal The Bank of Japan did not draw on the swap line. Bank and to make interest payments on the In the five weeks through April 8, the dollar Treasury’s securities issued in the German capi­ had advanced a further 11V4 percent against the tal market. German mark, 53/4 percent against the pound On March 14, President Carter announced a sterling, and 43/4 percent against the Japanese broad anti-inflation program that included action yen to reach the highest levels recorded in some aimed at balancing the fiscal 1981 budget deficit, two and one-half years. Nevertheless, the a surcharge on imported oil, and authorization scramble for funds in the United States had for the Federal Reserve under the terms of the about run its course, and an increasing number of Credit Control Act of 1969 to impose special re­ economic indicators were suggesting that overall straints on credit expansion. Accordingly, the economic activity in the United States was slow­ Federal Reserve asked the commercial banks to ing rapidly. Under these circumstances, market hold their growth of lending to U.S. residents in a participants began to sense that domestic interest range of 6 to 9 percent during 1980, required spe­ rates would soon turn down. Meanwhile, foreign cial deposits from nonmember banks and other money markets had tightened up considerably, in lending institutions, and raised the marginal re­ part as a result of the recent heavy exchange serve requirement on managed liabilities from 8 market intervention. to 10 percent for large member banks and U.S. Against this background, once U.S. interest agencies and branches of foreign banks. In addi­ rates showed clear signs of declining in early tion, the Federal Reserve imposed a 3-per- April, the dollar came under immediate and centage-point surcharge on large member banks’ heavy selling pressure. At this time, also, dwin­ discount window borrowings. Following these dling prospects for a solution to the hostage situ­ measures, U.S. short-term interest rates con­ ation seriously heightened political tensions be­ tinued to climb through late March and into tween the United States and Iran, adding to the early April, reaching unprecedented highs. market’s concerns about the dollar. From April By late March, the bidding for dollars had be­ 8 through 10 the dollar dropped sharply across come so generalized that demand pressures, the board, declining about 5 percent against the which had previously been concentrated more major European currencies in only 24 hours. To heavily in markets abroad, began erupting at any cushion the decline, the Trading Desk intervened time during the 24-hour trading day. To counter in sizable amounts, operating in German marks disorderly conditions, the Desk entered the New and Swiss francs. The Desk also sold French York market in March and the first week of April francs, in consultation with the Bank of France, as a buyer of German marks on 13 occasions, of to avoid aggravating the weakness of the mark Swiss francs on 4 occasions, and of Japanese yen relative to the franc within the EMS. on 10 occasions. In early April, the Desk also in­ Nevertheless, as interest rates continued to tervened on one occasion to purchase marks in decline in the United States and the sequence of the Far East. Between mid-March and early weekly indicators showed that the key monetary April, the Desk purchased an additional $761.6 aggregates were contracting, the dollar came un­ million equivalent of marks in the market, der periodic selling pressure. Traders generally which—combined with an additional $684.4 mil­ recognized that the Federal Reserve’s policy of lion equivalent acquired from correspondents— restraint on money supply growth was consistent were added to System and Treasury balances. with some easing in financial market conditions, Between February 1 and early April the Federal particularly as demands for money and credit Reserve purchased $185.1 million equivalent of weakened and evidence of recession mounted. Swiss francs, including $140.4 million equivalent There were expectations that the momentum of in the market, which were added to System bal­ inflation would slow in the months ahead, but ances. Following up on the March 2 agreement traders remained concerned that interest rates with the Japanese authorities, the Federal Re­ were dropping more rapidly than anticipated. serve bought a total of $216.8 million equivalent Abroad, interest rates generally held firm so that Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Exchange Operations: Interim Report 457 favorable interest differentials for the dollar were alent by the month-end. During April, the rapidly eroding. The U.S. authorities stepped in System also operated in Swiss francs on three fairly quickly to cushion the decline whenever occasions, selling $80.2 million equivalent fi­ the dollar came on offer in late April. These oper­ nanced out of balances. In addition, the Federal ations were closely coordinated with similar in­ Reserve intervened in French francs on three oc­ tervention by the German Federal Bank and oth­ casions, selling a total of $73.9 million equivalent er foreign central banks and helped restore two- financed by drawings on the swap line with the way trading in the exchanges. Bank of France. Gradually over the month, market participants focused somewhat less on interest rate consid­ 2. Net profits and losses (-) on U.S. Treasury and Federal Reserve erations and more on broader economic develop­ current foreign exchange operations1 ments. Monthly data showed that the U.S. trade Millions of dollars position was improving, while some evidence suggested a slowing in U.S. inflation. As a result, U.S. Treasury dollar rates in the exchange market steadied. By Period Federal Exchange the end of April, although the dollar had declined Reserve Stabilization General Fund Account as much as 9 to IIV2 percent from its peaks Feb. 1 through against the major continental currencies, it was Apr. 30, 1980 ..................... 34.9 11.7 3.7 still 2 to 3V2 percent higher on balance for the Valuation profits and three-month period under review. Against the losses on outstanding assets and liabilities Japanese yen and the pound sterling, the dollar as of Apr. 30, 1980 .......... -21.8 -360.8 -137.9 ended the period about V2 percent higher on bal­ 1. Data are on a value-date basis. ance. During April, the U.S. authorities intervened During the period under review the Federal on nine occasions in marks, selling a total of Reserve and the Treasury both realized profits $1,183 million equivalent shared between the on foreign exchange operations. Table 2 shows Federal Reserve and the Treasury. Most of these that the System realized $34.9 million, the Ex­ operations were financed out of balances, but change Stabilization Fund realized $11.7 million, $387.6 million equivalent of System sales was fi­ and the Treasury’s general account realized $3.7 nanced by drawings under the swap line with the million in profits. On a valuation basis, however, German Federal Bank. At the same time the Fed­ as of April 30 the System showed $21.8 million in eral Reserve was able to buy $50.4 million equiv­ losses on outstanding foreign exchange holdings alent of marks in the market on two occasions and commitments. The Exchange Stabilization and $91.1 million equivalent from correspon­ Fund and the Treasury’s general account respec­ dents, thereby adding to System balances and re­ tively showed $360.8 million and $137.9 million ducing System swap debt to $296.4 million equiv­ in losses on outstanding assets and liabilities. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

458 Industrial Production Released for publication June 13 duced 3.6 percent, reflecting further curtailments in the output of basic metals, particularly for Industrial production declined an estimated 2.1 steel, and continued decreases in production of percent in May, after a decrease of 2.0 percent in other items. The production of nondurable goods April (revised from the 1.9 percent originally es­ materials, such as textiles, paper, chemicals, and timated). Reductions in output occurred in all containers, declined 1.7 percent in May, after major market groupings and were particularly similar reductions in the preceding three months. sizable for automotive products, home goods, Output of energy materials declined 1.5 percent. construction supplies, and durable goods materi­ als. The May index, at 145.5 percent of the 1967 Seasonally adjusted, ratio scale, 1967 = 100 average, was 4.7 percent below the level of the index in January 1980. Output of consumer goods decreased 1.7 per­ cent in May to a level 6.1 percent lower than that in May 1979. The production of consumer du­ rable goods dropped almost 5 percent in May, re­ flecting sharp declines in autos, utility vehicles, appliances, furniture, and carpeting. Auto as­ semblies, at an annual rate of 5.5 million units, were about 8 percent lower than in April and about 40 percent below the level of a year earlier. Among consumer nondurable goods, clothing and consumer fuel showed particularly large declines in output. Production of business equip­ 1969-70 = 100_______Annual rate, millions of units __________________________________1967=100 ment decreased 1.2 percent in May, after a slight­ , AUTOS: Stocks^, r \\r _ 1 12 6 - MANUFACTURING: ~ Sales vVV 10— Nondurable^— -w . ~ ly smaller decline in April. Output of construc­ — s' ~ ' — 8 tion supplies was again reduced sharply, bringing J \ J Domestic assemblies \ A 6 / Durable — the level of production almost 11 percent below \( | | | | | ' r' i i i i i that of a year earlier. 1974 1976 1978 1980 1974 1976 1978 1980 Federal Reserve indexes, seasonally adjusted. Latest figures: May. Output of durable goods materials was re­ Auto sales and stocks include imports. 1967= 100 Percentage change from preceding month Percentage change Grouping 1980 1979 1980 May 1979 to Apr.p May6 Dec. Jan. Feb. Mar. Apr. May May 1980 Total industrial production ............ 148.6 145.5 .1 .3 —.2 -.5 -2.0 -2.1 -4.5 Products, total ............................... 146.8 144.2 .2 .2 -.1 -.3 -1.7 -1.8 -4.1 Final products............................. 145.2 143.0 .3 .0 .3 -.2 -1.3 -1.5 -3.2 Consumer goods..................... 145.2 142.7 -.3 -.2 .2 -.4 -1.8 -1.7 -6.1 Durable ................................ 137.0 130.3 -1.7 -2.9 1.5 -.3 -4.9 -4.9 -18.8 Nondurable ........................ 148.5 147.7 .3 .9 -.3 -.4 -.7 -.5 -.7 Business equipment................. 174.2 172.1 .9 .5 .5 .0 -.9 -1.2 .4 Intermediate products................ 152.8 148.6 .1 .6 -.9 -.9 -3.2 -2.7 -6.8 Construction supplies ............ 146.0 139.8 -.4 .3 -1.3 -.8 -4.6 -4.2 -10.6 Materials.......................................... 151.5 147.6 -.1 .3 -.5 -.5 -2.3 -2.6 -5.2 p Preliminary. e Estimated. Note. Indexes are seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

459 Statements to Congress Statement by Paul A. Volcker, Chairman, Board to allow a period of time to digest and assimilate of Governors of the Federal Reserve System, be­ these changes before other legislative proposals fore the Subcommittee on Domestic Monetary to change the operations or structure of the Fed­ Policy of the Committee on Banking, Finance eral Reserve System are pressed. In particular, and Urban Affairs, U.S. House of Representa­ we do not believe that the provisions of the Fed­ tives, May 15, 1980. eral Reserve Modernization Act can be of such urgency that they need to be considered by the I am pleased to have the opportunity to present Congress on a priority basis while the Federal the views of the Board of Governors on H.R. Reserve and the financial system in general are 7001, the proposed “Federal Reserve Modern­ involved in the orderly implementation of the ization Act” introduced by Chairman Reuss for Depository Institutions Deregulation and Mone­ himself and Chairman Mitchell and Mr. Cav­ tary Control Act of 1980. Indeed, a measure of anaugh. experience under the legislation just passed As Chairman Reuss indicated in his in­ would be helpful in making any final legislative troductory statement, this bill was introduced judgment. the day after the Depository Institutions Deregu­ In general, our judgment is that the more radi­ lation and Monetary Control Act of 1980 was cal changes proposed in H.R. 7001 for the gov­ signed into law. I cannot let this opportunity pass ernance of the Federal Reserve would have an without expressing for myself and all the mem­ undesirable and unsettling effect on the carefully bers of the Board of Governors our deep appre­ constructed structure for the implementation of ciation for the dedicated work of your com­ monetary policy, which has worked well over the mittee, Chairman Reuss, and also of Chairman St years. Indeed, looked at not just section by sec­ Germain and the other members of the full com­ tion but as a whole, we believe that the net re­ mittee, which resulted in this major legislative sult, whether intended or not, could be to dilute achievement. This act, particularly titles I and II, substantially both the independence of judgment the Monetary Control Act of 1980 and the De­ and the regional attributes that have, through the pository Institutions Deregulation Act of 1980, years, been characteristic of the Federal Reserve will undoubtedly take their place among the most System. important pieces of financial legislation enacted I would now like to turn to a discussion of the in this century. specific proposals in H.R. 7001, beginning with The Monetary Control Act of 1980, strength­ the provisions of title II. ening the Federal Reserve’s ability to implement Title II contains significant provisions dealing monetary policy by providing an equitable and with structural changes in the Federal Reserve universal system of reserves for depository insti­ System. Sections 201 and 202 are interrelated. tutions, affords the Board tremendous challenges Section 201 would abolish the Federal Open and opportunities. Although these provisions are Market Committee and give sole authority for of overriding importance, they are only a few of the conduct of open market operations to the the many changes made by the new act that will Federal Reserve Board. It would remove the require the careful attention of the Board. presidents of the Federal Reserve Banks from Precisely because of the significance of these having any policy-deciding role in the formation many amendments, which involve new relation­ of monetary policy. Section 202 would revise the ships between the Federal Reserve and deposi­ Federal Advisory Council, by changing the mem­ tory institutions, we would suggest first of all that bership from each Federal Reserve District from it would be both appropriate and highly desirable a representative of private industry selected by Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

460 Federal Reserve Bulletin □ June 1980 the board of directors to the president of the Fed­ The Federal Reserve System has also benefit­ eral Reserve Bank for each District. This would ed from a unique capacity within its structure to place the presidents of the Federal Reserve profit from informed and constructive criticism Banks in an advisory role to the Board so far as from those concerned with its operations and open market policy questions are concerned. policies. This capacity would be weakened, in ef­ The Board believes that both of these changes fect, by abolishing the Federal Advisory Council would detract from the eflfective functioning of as presently constituted. That Council, con­ the Federal Reserve System. From its inception sisting of leading commercial bankers from each the Federal Reserve System has been based on a Federal Reserve District, provides an opportu­ combination of central and regional elements and nity for the Board of Governors to obtain a con­ on a desire to insulate the System from short­ sidered point of view of the economy and the term and partisan political pressure. Twelve Fed­ credit conditions of the country. It provides a eral Reserve Banks were established and given a channel for criticism and suggestions, ranging significant role in the operation of the System in from broad policy to operational concerns. The order to assure a proper consideration of view­ insights gained have helped the Board to imple­ points and needs from all sections of the country. ment policies and operations with more knowl­ The premise was that all wisdom does not reside edge of their implications than would otherwise in Washington and that a degree of insulation be possible. from immediate political considerations would We recognize that the same purposes could be be enhanced by an important role for the Reserve approached in other ways. But the question Banks. arises—why change an arrangement that is func­ Removing the Reserve Bank presidents from tioning well and one that the participants under­ membership on the Federal Open Market Com­ stand? mittee would inevitably erode these objectives. Is the purpose to weaken the regional elements The Reserve Bank presidents and their research or the consultative processes in the System? If staffs not only bring to the Federal Open Market not, what is it? Committee an element of experience, continuity, Section 203 would revise the provisions for the and insight that might be lacking in a purely appointment of Federal Reserve Bank presidents Washington-based policymaking organization. by removing the requirement of approval by the They also are an important source of knowledge Board of Governors of the Federal Reserve Sys­ and informed opinion about regional interests tem and by requiring that the presidents shall be and needs. bona fide residents of the District involved. Inevitably, there would be a profound dif­ The Board appreciates the importance of inde­ ference between an advisory role, as con­ pendent minded people serving as Reserve Bank templated by H.R. 7001, and the role of a partici­ presidents, individuals able to participate in pol­ pant sharing responsibility for policymaking. icy and operations alongside Board members. Removal of the presidents from the Federal We also believe that while the initiative and Open Market Committee could only have the ef­ choice lie with the regional boards, some review fect of making the Federal Reserve more “Wash­ of the appointment by public officials is an essen­ ington” oriented, less sensitive to regional con­ tial part of the appointment process, given the na­ cerns, and potentially lacking the professional ture of the duties. We know of no better way to career commitment now characteristic of many accomplish that result than the arrangements em­ of the Reserve Bank presidents. I should note in bodied in the Federal Reserve Act for almost 70 this connection that members of the Congress years. In that connection, we note the impor­ have recently expressed the view that the com­ tance of mutual respect and an ability to interact position of the Board itself should be more rep­ harmoniously between the Board and the presi­ resentative of regional and sectoral interests. dents of the Federal Reserve Banks. The proposal in H.R. 7001 to reduce the role of With respect to residency, the Board agrees the regional Reserve Bank presidents in the con­ that, and this has been the practice, the president duct of monetary policy seems quite contrary to of the Federal Reserve Bank should be a bona meeting that overall concern. fide resident of the District. However, we would Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 461 oppose a requirement for residency prior to em­ operations. In those respects, the public and pri­ ployment because it would detract from the abili­ vate interests broadly coincide, and the partici­ ty to obtain individuals of the highest caliber for pation of able men and women as directors, in­ the posts, including our ability to attract career cluding among them persons chosen by people to the Federal Reserve who might con­ stockholding members, I believe contributes im­ ceive of moving from one District to another as portantly to our efficiency and operational ef­ an avenue for promotion and development. fectiveness. The Board would not wish to see Section 204 provides that the Federal Reserve any changes made that would weaken either its System shall utilize its resources and generally ability to attract outstanding individuals as direc­ conduct its affairs in order to foster the policies tors of the Federal Reserve Banks and branches and purposes of the Employment Act of 1946 and or the continuing dedication of such individuals the Full Employment and Balanced Growth Act to their work. However attenuated the rights of of 1978, particularly the nation’s effort to achieve a stockholder may be compared with a normal a stabler price level and an improved economic corporation, that tangible evidence of continued structure. interest we believe helps enhance our ability to The Board is unclear on the intent of this sec­ obtain qualified independent-minded directors tion. The Board now accepts the Employment who are concerned and interested in the ef­ Act and the Full Employment and Balanced fectiveness of the System. Growth Act as guiding principles. We are, of In this connection, the provisions of H.R. course, concerned with price stability. In these 3257, a bill you have sponsored, Mr. Chairman, respects, the addition of this section would not would increase the number of class C directors appear to be necessary. However, the section appointed by the Board and thus permit the speaks specifically to the System’s using its re­ Board to increase the representation on the sources to improve the nation’s economic struc­ boards of directors of consumer, labor, and serv­ ture. We are uncertain as to the meaning and ice interests. We believe this approach is appro­ would desire further clarification of this pro­ priate. posed change to the System. I recognize that some directors could continue I would now like to address the provisions of to be elected by members holding only a “mem­ title I that would provide for the retirement of bership certificate.” But the Reserve Banks are Federal Reserve stock and substitute a certifi­ corporations and do have capital. The alterna­ cate of membership for stock ownership. In con­ tive, presumably, would be in effect to transfer nection with previous proposals for retirement of the stock evidence of that capital to a govern­ Federal Reserve stock, the Board has advised ment agency. But what would be achieved by this committee of its belief, on balance, that own­ such a change? Would it not, whatever is in­ ership of Reserve Bank stock is desirable be­ tended, lead to an implication or allegation of cause of the tangible indication such ownership Treasury control? Would it not, again whatever provides of the interest of member banks in the is intended, weaken the healthy concerns of operations and efficiency of the System. banks with how the Fed is managed? Chairman Reuss has suggested that the provi­ We do believe that consideration also needs to sions of the Monetary Control Act of 1980 make be given to the participation of nonbank financial the present stock requirements for member institutions on the boards of the Federal Reserve banks anachronistic. While it is true that the Banks; whether they should participate in the rights attached to ownership of stock in a Re­ election of directors; and if so, how this should serve Bank are, in fact, extremely limited, that be accomplished. We also recognize that limiting does not dispose of the question. Voluntary payment of the dividends to 6 percent on Federal membership still has an important role to play in Reserve stock can be a small disincentive to the Federal Reserve System. Members elect membership, and if it is concluded that member­ some of the directors of the Federal Reserve ship should be broadened and stock retained, Banks who, in turn, elect the Bank presidents consideration might also be given to providing a and maintain surveillance over the efficiency and rate of return on that stock more comparable to effectiveness of Reserve Bank management and that on government securities. Considerations of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

462 Federal Reserve Bulletin □ June 1980 this sort lead us to the conclusion that elimina­ powers is sometimes indistinguishable. We be­ tion of Federal Reserve stock would be undesir­ lieve that all those powers would be weakened able but that consideration of which institutions by trying to enforce a strict separation. Obvious­ might be eligible for membership, the formula for ly, there are a number of issues in the relation­ acquiring such stock, and the rate of dividends ships among supervisory agencies, some of will be in order as we gain experience with the which have been addressed in recent legislation. Monetary Control Act of 1980 and its impact on As we gain experience under that legislation, we the Federal Reserve System. may have further proposals. But the Board The provisions of H.R. 7001 do not change the strongly recommends that it continue to have a role of the Federal Reserve System with respect role in this area and that it retain responsibilities to the supervision and examination of member for supervision and examination. banks. However, in his introductory statement, In summary, Mr. Chairman, the Board is con­ Chairman Reuss said, “Chartering and examina­ cerned that the proposed structural revisions tion of state banks, member and nonmember would weaken certain traditional elements in the alike, would reside in the state regulatory Federal Reserve structure that significantly and agencies rather than the Fed.” In view of this substantively have contributed to the independ­ statement, I would be remiss if I did not address ence, the regional balance, and the efficiency, ef­ the subject of the role of the Federal Reserve in fectiveness, and integrity of our operations. the supervision and examination of member But, we do agree that further consideration of banks. the nature of membership and eligibility and The Board has stated on a number of occa­ terms of stock ownership in the Federal Reserve sions that it believes that the condition of the System will be needed in light of the enactment banking system, as well as information about in­ of the Monetary Control Act. Attention should dividual banks, is an important input for mone­ be given to the participation in the operations of tary policy formulation, which would be lost or the Federal Reserve Banks by nonbank financial substantially reduced if the Federal Reserve had institutions that will maintain reserves with the no role in the regulation or examination function. Federal Reserve, as well as their representation Our experience in recent years has only served on the boards of directors of those banks. And to strengthen the conviction that information that we continue to believe that those boards should the System obtains in the course of exercising its be expanded in size in order to accommodate a supervisory functions provides key insights into broader representative segment of the public. such matters as the state of liquidity and viability As experience is gained under the Monetary of the nation’s banking institutions, indispens­ Control Act of 1980, we will be happy to work able elements in the formulation and implemen­ with you and your committee and its staff in tation of monetary policy. The borderline be­ evaluating and developing possible legislative tween monetary, regulatory, and supervisory proposals that might accommodate these needs. Statement by Paul A. Volcker, Chairman, Board however, I am not satisfied that we in the Federal of Governors of the Federal Reserve System, be­ Reserve and others in appropriate government fore the Subcommittee on Conservation and agencies have fully digested all of the facts and Credit of the Committee on Agriculture, U.S. circumstances that threatened a few sizable fi­ House of Representatives, May 21, 1980. nancial institutions and the financial markets generally. But it is clear to me that the episode Mr. Chairman, I am pleased to be here today to does—in an all too vivid way—raise important discuss with your subcommittee some of my im­ questions about the structure and regulation of pressions and reactions to the recent chain of futures and commodities markets. We intend to events in the silver market, with emphasis on pursue those questions as quickly and as dis­ their implications for public policy. Even now, passionately as we can, while looking toward Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 463 recommendations for government and private the commercial paper crisis surrounding the actions. bankruptcy of Penn Central in 1970, to take ap­ The Federal Reserve does not have direct stat­ propriate steps to insure the continued viability utory or regulatory authority over any com­ and integrity of the markets, particularly in times modity or financial futures markets. We do have of stress. To fulfill this function, the Federal Re­ statutory authority to establish margin require­ serve must have at least a general awareness of ments for the purchase or carrying of equity and trends and developments in all sectors of the fi­ equity-type securities. And, in cooperation with nancial markets. the Treasury, we have a more limited and infor­ Finally, the Federal Reserve has a direct and mal oversight responsibility for the government immediate interest in the extent to which credit is and government-related securities markets. used to finance transactions in financial markets. While our direct authority does not extend to That interest can take any of several forms in­ the futures markets, to the commodity markets cluding a concern about credit-financed specula­ generally, or to the gold and silver markets spe­ tion, a concern about the diversion of credit from cifically, we do have a continuing interest in the more productive uses, or a concern that an ex­ performance and functioning of those markets. cessive use of credit for these purposes can ulti­ That interest arises in several contexts. For ex­ mately threaten the safety and soundness of indi­ ample, to the extent that price trends in those vidual financial institutions. And, in the recent markets, or in segments of those markets, radi­ silver situation, it would seem that, at least to a cally depart—for whatever reasons—from gener­ degree, all of these areas of concern were pres­ al price movements (as was the case with gold, ent. silver, and other commodities during late 1979 Looked at from any or all of these vantage and early 1980) they can directly and indirectly points—or from a more encompassing per­ fuel inflation and inflationary expectations. Re­ ception of the national interest—it seems clear curring headlines detailing the substantial and that there is need for a thoroughgoing study to cumulative rise in gold and silver prices, for ex­ determine the kinds of legislation or regulatory ample, surely worked to reinforce inflationary remedies that are required to check potential expectations in 1979 and early 1980. Indeed, it abuses or excesses in these markets. While I was largely for this reason that the Federal Re­ have no firm view at this time as to specific ac­ serve, in October 1979 and again in March 1980, tions that should be taken, I do have strong opin­ called specific attention to speculative tenden­ ions about the types of questions that need to be cies in the commodities markets and requested examined in order to make decisions intelligently banks to avoid speculative lending. and productively. The Federal Reserve’s general interest in these The first of those questions relates to the char­ markets also stems from its responsibilities for acter of the markets themselves. Some tend to promoting the efficient and effective functioning use the term “futures market” as if it were a of the financial markets. That interest is obvious­ clear term of art, which conveniently encom­ ly more pointed in certain interbank and govern­ passes the full range of instruments and assets ment securities markets, but financial markets in that are traded for forward delivery. In fact, all the United States and around the world have be­ one needs to do is look at the pages of the Wall come integrated to the point at which it is very Street Journal to capture the diversity of these difficult, as a practical matter, to segregate one markets. Agricultural products, metals (precious market or one institution from others. For ex­ and otherwise), foreign currencies, and Treasury ample, some of the institutions with the greatest and other securities are all now actively traded exposure in the silver situation had far-flung ac­ on exchanges, which historically were developed tivities in many other markets. Had one of those for quite limited and specialized purposes. In­ institutions become insolvent, the problem deed, it has been less than five years since finan­ would have quickly spread to other markets, cial futures were first traded on organized ex­ many of which are far removed from silver. Be­ changes. cause of the interdependence of our financial Further, in most cases, futures markets are in­ markets, the central bank must be prepared, as in exorably tied to an underlying asset that trades Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

464 Federal Reserve Bulletin □ June 1980 actively in cash or spot markets not just here in arrangements in order to keep capital costs low the United States but around the world. These and to permit participation by legitimate users of markets, whether viewed from the perspective of the market. While this approach is quite under­ the relationship of the “spot” price to the “fu­ standable, it must be recognized that the initial tures” price or from the perspective of the Lon­ margins held by the exchanges (or the clear­ don price to the New York price, are highly in­ inghouse) are the first line of defense in the event terdependent, and that interdependence is a liquidity or other problems develop with individ­ reality that must weigh heavily in our deliber­ ual brokers or their customers. Because of this, ations as to the appropriate regulatory frame­ the level and the form of initial margins do have work for the future. At the extreme, for example, importance for the integrity of the markets gener­ we must recognize that excessive regulation may ally. simply work to drive activity off the organized Margins on futures contracts are a kind of per­ exchanges or offshore, where the threat of abuse formance bond, as money or other assets are put to the detriment of our own investors and institu­ up in advance of a purchase to provide assurance tions will be increased. that contractual obligations will be met. Thus At this point, I am inclined to the view that all they differ from the margin that pertains to the forward and futures instruments should not be acquisition of securities, which involves an ex­ treated alike. More specifically, I believe it is tension of credit to help finance an immediate possible to distinguish “financial” futures from purchase. Despite this clear distinction, how­ other forward-type instruments and that such a ever, the point should be made that in some in­ distinction may be appropriate from the view­ stances credit is indirectly involved in meeting point of public policy. Certainly, futures in margins on futures contracts. In the recent silver Treasury securities, foreign exchange, and per­ situation, for example, it appears that some par­ haps gold and silver—to name a few—do have ticipants relied heavily on borrowed funds to characteristics, including low costs of transpor­ meet margin maintenance calls. This raises the tation and storage in proportion to value, that question then as to whether there should be regu­ distinguish these instruments from futures in lations either limiting the amount of credit that wheat or other agricultural products. Financial may be used to finance the acquisitions or main­ futures, moreover, are of more direct and imme­ tenance of positions or whether, at the least, diate interest to the Treasury and the Federal Re­ there should be regulations governing the kinds serve than are traditional agricultural futures, of collateral that may be used to finance such since they obviously have more direct potential credits. for influencing developments in financial markets Aside from the credit questions there are other and markets for international exchange. issues with regard to margins that need to be ex­ Any consideration of possible changes in the plored. For example, under present arrange­ regulation of futures markets must, of course, ments the Commodity Futures Trading Commis­ take into consideration the whole question of the sion (CFTC) has only emergency powers to set form and amount of margins. As the sub­ margins, which, as I understand, have been used committee knows, initial margins in these mar­ only once. The basic authority to set margins kets have traditionally been quite small—gener­ and other terms of trading lies with the ex­ ally only large enough to cover one day’s changes. Because the exchanges are in com­ maximum expected price movement—and par­ petition with each other, this arrangement inevi­ ticipants have been able to meet these require­ tably raises the question of competition in laxity. ments not only with cash but with other forms of Thus, while this arrangement apparently has, collateral. In the main, however, the markets with a few exceptions, worked well, I cannot rely on maintenance margins to insure contract help but conclude that it too should be reexam­ performance. Under these arrangements, posi­ ined. I reach this conclusion not just because of tions are marked to market daily, and cash pay­ the obvious question whether, in the process of ments are funneled through the clearinghouses setting and changing margins, legitimate self-infrom the daily losers to the gainers. terests of the exchanges can be separated from The exchanges have worked out these margin the broader public interest. In addition, it seems Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 465 to me that some form of direct governmental par­ segments of these markets. Conceivably, author­ ticipation in the process of setting margins and ity for the regulation of these markets could be other terms of trading would, by elevating these vested with any one of these agencies or perhaps decisions to the realm of public policy, clearly divided among the agencies. Alternatively, it work to remove inevitable pressures from the ex­ could be placed with an oversight board or com­ changes that must arise in the context of setting mission with representatives from all of the such margins. agencies, as well as with representatives of the There is also a question as to the manner in exchanges or the public. Ultimately, however, which margins are administered. Initial margins, that judgment is best made in a context in which as noted earlier, are understandably low. These some of the issues I have raised are more fully low margins, however, permit a considerable analyzed. We in the Federal Reserve, in cooper­ amount of leverage. And, moreover, because of ation with other government agencies, have un­ the policy of funneling maintenance margin pay­ dertaken a broad-based study of these and re­ ments from losers to gainers, there is the clear lated questions, and I fully expect that the potential, which we may have seen in silver, primary result of that effort will be a set of legis­ for the pyramiding of positions to achieve still lative recommendations that would be submitted greater leverage. This raises the question as to to the Congress. However, that effort will take whether it might not be practical and appropriate some time. —at least in some circumstances—to limit in In concluding, let me make two final observa­ some fashion the cash payments made to those tions. First, I am fully aware that some would on the “plus” side of the market in connection argue that the recent episode in the silver mar­ with the daily marking to market. kets should not be cause for concern. This posi­ This range of questions and issues is meant to tion appears to be based on the point that, in the be illustrative, not exhaustive. There are many final analysis, the situation worked itself out others that also need to be examined—the poten­ without major and permanent damage. There tial use of position limits and the nature of sur­ may be something to that assessment, but from veillance activities across futures exchanges and my vantage point it was simply too close a call to into the cash market, among others—before rea­ permit us to take the liberty of a “business-assoned judgment can be made about the nature of usual” attitude. regulatory measures that might be needed in this Secondly, I would also emphasize that the sil­ area. And it seems to me that only when we have ver episode illustrates, very forceably, the kinds answered those questions will we be in a position of distortions, instabilities, and risks associated to judge effectively how any new regulations can with unchecked inflation. Indeed, in a manner far best be administered. more convincing than the best of our economic There are several government agencies, in­ studies, or the most resounding rhetoric, this sit­ cluding the CFTC, the Securities and Exchange uation can serve as a reminder to us all of the Commission, the Treasury, and the Federal Re­ importance of standing fast in our efforts to bring serve, that have a natural interest in at least some inflation under control over time. □ Statement by J. Charles Partee, Member, Board ing developments into perspective, and that they of Governors of the Federal Reserve System, be­ also provide a good forum for discussing legisla­ fore the Committee on Banking, Housing, and tive initiatives that may be needed to help assure Urban Affairs, U.S. Senate, May 21, 1980. the continuation of a sound financial system. Recent data on the condition of commercial I am happy to appear before this committee banks indicate that the banking system has today to discuss the condition of the financial worked out most of its problems of the mid-1970s system. The Board continues to believe that and is now in generally good shape. The number these annual hearings are useful for putting bank­ of bank failures during each of the last three Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

466 Federal Reserve Bulletin □ June 1980 years has been below the levels prevailing during however, and that the prospects are good for the mid-1970s, and last year no bank of size had some improvement in the current year. First, the to be closed. Moreover, the number of problem slowdown in the economy is retarding the de­ banks is well below the level of the mid-1970s mand for loans by both consumers and business, and is at an acceptable level. For example, only so that the growth in bank credit should slow. about 2 percent of the state member banks super­ Moreover, the voluntary special credit restraint vised by the Federal Reserve now require special program is designed to hold bank loan growth attention, and these banks hold only about 1 per­ this year within a range of 6 to 9 percent, and we cent of total state member bank assets. firmly intend to see that the result is achieved. The quality of bank assets also has improved Even though banks probably will still not be able over the last several years. Aggregate classified to raise much equity this year due to depressed assets of commercial banks at year-end 1979 bank stock prices, retained earnings may well be were down more than 25 percent from year-end sufficient to keep capital growing more rapidly 1976, even though bank assets increased by more than this reduced pace of bank credit expansion. than 40 percent in the interval. Looking at the While most of the statistical indicators of the nation’s larger banking organizations, non­ condition of the banking system are thus posi­ performing assets (which include nonaccruing tive, it is important to recognize that we appear and reduced rate loans and real estate acquired in to be entering a period of greater risks for the foreclosure) amounted to about 1 percent of total economy and financial markets. Recent econom­ assets at year-end 1979, compared with a little ic data clearly indicate that the economy is now over 2V2 percent three years earlier. Real estate on the decline, and the rate of that decline up loans and foreclosed properties continue to be until now appears considerably sharper than the largest category of problem assets. most had anticipated. Based on our experience in In the last three years, bank earnings have previous recessions, this economic downturn is strengthened, and the rise in the aggregate has likely to result in an increased incidence of prob­ been well above the growth of overall corporate lem loans during 1980 and probably on into 1981. profits. In 1979 alone, bank earnings rose 19 per­ One area of particular concern to many bank­ cent, aided by good growth of bank assets and ers and supervisors is consumer debt. Even be­ loans and well maintained net interest margins. fore the economy began to decline, consumer in­ So far in 1980, bank earnings have risen moder­ stallment loan delinquencies as a percentage of ately further. I should note that this earnings outstanding loans were rising; and the continuing performance is considerably deflated when ac­ squeeze between earnings and inflation and in­ count is taken of inflation, and that the return creasing unemployment almost surely will accel­ on equity in banking remains well below that erate the trend. The implications of the liberal­ realized in manufacturing industries as a whole. ized personal bankruptcy laws bring added In past hearings, this committee has expressed uncertainty to this important area because there particular concern over the secular decline in has been no experience with the new provisions bank capital ratios. The Board shares that con­ during a time of adversity. cern and regrets that over the past three years Banks also have large loan balances out­ the decline in capital ratios has resumed, so that standing to several major corporations whose fi­ at the end of 1979 the average ratio was little bet­ nancial problems have been well publicized. ter than at the previous low reached in 1974. As Such problems could well tend to multiply and, if before, the problem continues to be that banks not resolved, some banks could experience sig­ have been faced with strong credit demands from nificant losses. We believe, however, that most their customers, given the inflationary environ­ banks will be able to absorb any such losses ment, while the capital markets have remained through charge-offs to quite sizable loan loss re­ very unreceptive to new stock financing. Re­ serves, backed up by a generally favorable un­ tained earnings simply have been insufficient to derlying earnings flow. keep up with asset growth. External shocks and dislocations also are I am glad to report that there was almost no likely to be having an adverse impact on banks, further slippage in bank capital ratios last year, largely by affecting the financial condition of cer­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 467 tain borrowers. We are all well aware of the im­ The Board supports the entire legislative pro­ pact that the dramatic increase in petroleum posal jointly submitted by the five agencies. In prices is having on the economy. This upsurge my testimony today, however, I will limit my has radically changed the cost structures of some comments to those parts of the draft legislation businesses and has altered the pattern of con­ that are most directly related to the Federal Re­ sumer expenditures, not only for goods but also serve’s supervisory responsibilities. for travel and other services. These develop­ One section of the draft legislation would ments are eroding the earnings of some firms that amend section 3(d) of the Bank Holding Compa­ borrow from banks, thereby reducing their abili­ ny Act to permit, in exceptional circumstances, ty to service their debt. This situation is ex­ an out-of-state bank holding company to acquire acerbated by the historically high current costs a large commercial bank that has failed or a bank of debt needed to finance receivables, invento­ holding company controlling a large commercial ries, and recent capital improvements. The dra­ bank that has failed. Similarly, an out-of-state matic increase in petroleum prices also has con­ bank holding company would be permitted to ac­ tributed to a deterioration in the balance of quire a newly chartered commercial bank that is payments of many non-oil producing, less devel­ the successor through purchase and assumption oped countries. Many of these countries are sig­ of the assets and liabilities of a large savings bank nificant borrowers from American banks and that has failed. At present, section 3(d) of the some could have difficulty servicing their debts if Bank Holding Company Act prohibits an out-ofthey should experience excessive deficits for an state holding company from acquiring a bank un­ extended period. less such acquisition is expressly permitted by In recent months, high interest rates also have the statutes of the state in which the bank to be had an adverse effect on the earnings of thrift in­ acquired is located. Only several smaller states stitutions and some banks that have balance have such statutes. sheets concentrated in longer-term fixed rate as­ Amending section 3(d) to permit such out-ofsets. The earnings of these institutions are espe­ state acquisitions, we believe, would have sever­ cially vulnerable because they have more vari- al important potential benefits. First, it could able-rate liabilities than variable-rate assets. The substantially increase the number of potential sharp decline in interest rates over recent bidders for a large failed institution, thereby re­ weeks—particularly rates on large negotiable ducing the possibility that the institution would certificates of deposit and money market certifi­ have to be liquidated for lack of a buyer prepared cates—should begin fairly soon to give these in­ to make a cost-effective bid. If the authorities stitutions some much needed relief. But we can­ were forced to liquidate the failed bank, the com­ not be sure of future interest rate trends, and the munity would permanently lose the bank’s serv­ earnings of these institutions will remain exposed ices. In addition, uninsured depositors of the to excessive volatility so long as they are unable bank could suffer losses, undermining public to achieve a better balance between variable-rate confidence in the banking system. If forced liqui­ liabilities and variable-rate assets. dations were to occur at a time when institutions Given these many risks and uncertainties, the were generally recognized to be under pressure, five federal financial institutions supervisory the domino effects of such a development could agencies, as a matter of proper contingency plan­ become very serious indeed. ning, recently submitted a legislative proposal to Under current law, it may be difficult or impos­ the Congress to deal with possible future prob­ sible to find an in-state buyer for a large failed lems in the banking and thrift industries. This institution. In some states, such as Illinois, pres­ proposal would authorize interstate acquisitions ent branching and holding company laws prohibit of failed depository institutions in certain emer­ in-state organizations from acquiring a failed gency situations. It would also expand the au­ bank and keeping its office open to the public. thority of the supervisory agencies to extend Moreover, even if state holding company or emergency financial assistance to depository in­ branching laws permit an in-state acquisition, stitutions critically squeezed by general econom­ there may be no such organization with the finan­ ic adversities. cial resources and managerial capability to make Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

468 Federal Reserve Bulletin □ June 1980 the acquisition. This is particularly likely if the this authority. Second, interstate acquisitions failed bank is one of the largest in the state. Fi­ would be permitted only in cases involving a nally, even if there are one or more organizations large commercial bank or savings bank. A failed in the state that could acquire the failed bank, the commercial bank would have to have total assets acquisition might have such serious anti­ in excess of $1.5 billion, or to be one of the three competitive implications within the state that it largest commercial banks in its state. A failed could not be permitted under the existing anti­ savings bank would have to have total assets in trust standards. excess of $1 billion, or to be one of the three Another reason for allowing out-of-state acqui­ largest thrift institutions in its state. Third, the sitions by bank holding companies in these ex­ Federal Financial Institutions Examination Coun­ ceptional “forced marriage” circumstances is to cil would have to certify to the Board, with at avoid giving foreign banks an advantage in acqui­ least four of its five members concurring, that an sitions that is denied to all out-of-state U.S. emergency exists and that an intrastate acquisi­ banking organizations. Such preferential treat­ tion of the failed bank is not in the public interest ment of foreign banks seems to us unfair and or is otherwise not feasible. runs counter to the concept of equal national Finally, it should be noted that the proposed treatment of U.S. and foreign banks underlying legislation would give the Board authority to re­ the International Banking Act. ject any potential interstate bidder in an emer­ In drafting the proposed legislation, the gency acquisition of a failed bank on grounds agencies were careful to place severe limitations that the acquisition would have an adverse effect on the potential use of the interstate acquisition on competition or concentration of financial re­ provision in order to protect the interests of both sources in any region or in the nation as a whole. the public and existing state preferences as to All in all, in the Board’s judgment, these strin­ structure. First, such acquisitions would be per­ gent limitations should remove any concern that mitted only in cases when a bank has already fall­ the proposed legislation would promote inter­ en into such circumstances that its principal su­ state banking in contravention of congressional pervisor is prepared to declare it insolvent, and intent or that it would lead to a significant reduc­ therefore it has failed. Institutions that are sim­ tion in competition or an increase in the con­ ply in danger of failing would not be covered by centration of banking resources. □ Statement by Paul A. Volcker, Chairman, Board ticulars set forth in that report, I will use the time of Governors of the Federal Reserve System, be­ provided for my statement to comment on the fore the Committee on Banking, Housing, and underlying issues to which S. 2704 is directed. Urban Affairs, U.S. Senate, May 29, 1980. The Federal Reserve does not have direct stat­ utory or regulatory authority over any com­ Mr. Chairman, I welcome the opportunity to out­ modity or financial futures market. We do have line the preliminary views of the Board of Gover­ statutory authority to establish margin require­ nors on S. 2704, which would authorize the ments for the purchase or carrying of equity and Board to impose margin requirements on a broad equity-type securities, including stock options. spectrum of “financial” instruments both in the And in cooperation with the Treasury, we have a cash or “spot” markets and in the futures or for­ more limited and informal oversight role with re­ ward delivery markets. The Board shares the spect to the government and government-related concerns—growing out of recent developments securities markets. in the silver market—that have prompted these While our direct authority does not extend to hearings, and the staff has prepared an interim re­ the “futures” markets, the commodity markets port on the financial aspects of that situation generally, or the gold and silver markets specifi­ [available on request from the Board’s Publications cally, we do have a continuing interest in the per­ Services]. Rather than delve further into the par­ formance and functioning of those markets. That Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 469 interest arises in several contexts. For example, would seem that, at least to a degree, all of these to the extent that price trends in those markets, areas of concern were present. or in segments of those markets, radically de­ Any approach to the regulation of these mar­ part—for whatever reasons—from general price kets must start with a recognition of the charac­ movements (as with gold, silver, and other com­ ter of the markets themselves. Some tend to use modities during late 1979 and early 1980), they the term “futures market” as if it were a clear can directly and indirectly fuel inflation and infla­ term of art that conveniently encompasses the tionary expectations. Recurring headlines detail­ full range of instruments and assets that are trad­ ing the substantial and cumulative rise in gold ed for forward delivery. In fact, all one needs to and silver prices, for example, surely worked to do is look at the pages of the Wall Street Journal reinforce inflationary expectations in 1979 and to capture the diversity of these markets. We early 1980. Indeed, it was largely for this reason tend to think of futures markets as essentially re­ that the Federal Reserve, in October 1979 and lated to agricultural products when in fact a wide again in March 1980, called specific attention to range of financial instruments—for which there is speculative tendencies in the commodities mar­ no underlying tangible asset—are now trading on kets and requested banks to avoid speculative the futures markets. Trading in these instruments lending. began only about five years ago and has grown The Federal Reserve’s general interest in these very rapidly in the relatively short time since markets also stems from its responsibilities for then. promoting the efficient and effective functioning Further, in most cases, futures markets are in­ of the financial markets. That interest is obvious­ exorably tied to an underlying asset that trades ly more pointed in certain interbank and govern­ actively in cash or spot markets, not just here in ment securities markets, but financial markets in the United States but around the world. These the United States and around the world have be­ markets, whether viewed from the perspective of come integrated to the point where it is very diffi­ the relationship of the spot price to the futures cult, as a practical matter, to segregate one mar­ price or from the perspective of the London price ket or one institution from others. For example, to the New York price, are highly interdepen­ some of the institutions with the greatest ex­ dent. That interdependence is a reality that must posure in the silver situation have far-flung activ­ weigh heavily in our deliberations as to the ap­ ities in many other markets. Had one of those propriate regulatory framework for the future. At institutions become insolvent, the problem the extreme, for example, we must recognize would have quickly spread to other markets, that excessive regulation may simply work to many of which are far removed from silver. Be­ drive activity off the organized exchanges or off­ cause of the interdependence of our financial shore where the threat of abuse to the detriment markets, the central bank must be prepared to of our own investors and institutions might be in­ take appropriate steps to insure the continued vi­ creased. ability and integrity of the markets, particularly All of this serves to underscore the Board’s re­ in times of stress. To fulfill this function, the Fed­ luctance to endorse a specific regulatory ap­ eral Reserve must have at least a general aware­ proach, or even a broad regulatory philosophy, ness of trends and developments in all sectors of until it has had more time to study the issues. To the financial markets. that end, the Federal Reserve, in consultation Finally, the Federal Reserve has a direct and with other government agencies, has undertaken immediate interest in the extent to which credit is an intensive study of these markets with a view used to finance transactions in financial markets. toward developing specific recommendations to That interest can take any of several forms, in­ the Congress for legislative action. As a practical cluding a concern about credit-financed specula­ matter, I doubt that we can have even prelimi­ tion, a concern about the diversion of credit from nary conclusions before midsummer. I do not other uses, or a concern that an excessive use of want to anticipate the results of that considered credit for these purposes can ultimately threaten review. I do, however, have some more general the safety and soundness of individual financial thoughts on the problems that S. 2704 seeks to institutions. In the recent silver situation, it address. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

470 Federal Reserve Bulletin □ June 1980 At this point, I am tentatively inclined to the possibility of differentiating between classes of view that all forward and futures instruments instruments and classes of market participants should not be treated alike. More specifically, I for purposes of setting initial margins. believe that the distinction drawn in S. 2704 be­ Another aspect of margins on futures con­ tween financial futures and other forward-type tracts—that of maintenance margins—is appro­ instruments may be appropriate from the view­ priately recognized in S. 2704 as an area of con­ point of public policy. Certainly, futures in cern. Under current procedures, futures Treasury securities, foreign exchange, and per­ contracts are marked to market daily. Thus, haps gold and silver, to name a few, do have when the price of a contract rises, those holding characteristics—including low costs of transpor­ short positions must make daily cash payments tation and storage in proportion to value—that to satisfy the maintenance margin. These cash distinguish these instruments from futures in payments are transferred through the exchange wheat or other agricultural products. There is clearinghouse and paid out to the long position. some evidence that speculative, as opposed to In the recent silver episode, it was the mainte­ hedging, activity tends to be proportionately nance margin and the daily marking to market greater in those markets. Financial futures, with corresponding cash payments that triggered moreover, are of more direct and immediate in­ the substantial use of bank credit. This same terest to the Treasury and the Federal Reserve mechanism also permits the pyramiding of posi­ than are the traditional agricultural futures, given tions as prices are rising. This raises in my mind our general responsibilities. the question of whether it might be appropriate— The bill now before this committee would seek at least in some circumstances—to withhold cash to regulate these markets through the use of mar­ payments from those on the “plus” side of the gin requirements. Such requirements might take market in connection with the daily marking to the form of limiting the use of credit to finance market. transactions, establishing minimum cash or other Margin requirements are only one possible ap­ deposit requirements associated with the acquisi­ proach to preventing abuses in these markets. I tion of such instruments, or both. Margins can be expect therefore that our study will examine a useful tool for limiting speculation, but their alternative or complementary regulatory ap­ use in the context of the futures market is quite proaches, such as position limits and increased different in substance than is the case in the monitoring of positions across exchanges and equity markets. across markets. It may be that these or other ap­ Margins on futures contracts, as the markets proaches will be found to be equally effective in are now organized, are simply a kind of perform­ forestalling potential problems. In any case, I ance bond to assure that contractual obligations would not want to rule out such a possibility be­ are met. Unlike the stock market, no cash pay­ fore the study is completed. ment (apart from the margin requirement) is nec­ There is also a question as to how margin re­ essary at the time a futures contract is acquired. quirements (or other regulatory tools) should be Because of this, and because of the need to keep administered. I can understand a certain logic in capital costs for legitimate market participants placing any authority for such financial futures low, initial margins on futures contracts are very with the Federal Reserve, partly because there is small—normally only large enough to cover one no other natural, logical forum. I must confess to or two days’ maximum movement in price. Set­ a sense of uneasiness arising from the potential ting higher initial margin requirements would complexities of effective regulation of these mar­ work not only to dampen speculation by reduc­ kets, with all of the implications for staffing re­ ing leverage but also to drive participants out of quirements and for demands on the time and en­ the market, thereby reducing liquidity. Thus, it is ergy of the Board. I believe I can tell you the not apparent to me at this time that the level of Board does not eagerly seek this authority. At the initial margin—of and by itself—can be the the same time, we are willing to approach the sole, or principal, tool for reaching the specula­ subject with an open mind should legislation of tive problem in all these markets. In this con­ the type proposed be pursued. nection, it seems to me worthwhile to explore the It is conceivable that a regulatory plan could Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 471 be modeled after the Municipal Securities Rule- construed. In the aftermath of the silver situa­ making Board; in other words, a self-regulatory tion, the nagging problems in other areas of these organization made up of industry representatives markets, and their continued explosive growth, I but whose decisions would be subject to over­ am firmly of the view that a clearer focus for sight by one or more government agencies. How­ some form of government oversight and regula­ ever, I believe that the judgment as to the most tion, taking account of the credit aspects, is appropriate body to administer any regulations needed. We fully expect, upon the completion of that are deemed appropriate can best be made in our study, to report back to the Congress with the light and the conclusions of the study made by specific recommendations, or a more detailed re­ the Board staff. action to S. 2704, taking full account of issues My concerns about the appropriate approach that have surfaced in market developments and to regulation of these markets should not be mis­ in these hearings. □ Statement by Nancy H. Teeters, Member, Board has not been helpful to such communities. This of Governors of the Federal Reserve System, be­ result is not surprising since the special credit fore the Subcommittee on Domestic Monetary program was designed for a different purpose. Policy of the House Committee on Banking, Fi­ As spring approached, the Board had been re­ nance and Urban Affairs, May 29, 1980. ceiving reports that borrowers in some smaller communities were facing an especially severe fi­ I appreciate this opportunity to present the views nancial bind because the local banks on which of the Board of Governors concerning steps that they depended for short-term credit were fully might be taken to help meet “the credit needs of loaned up. Since farm communities, in particu­ inner-city minority communities.” The Board lar, were then moving into the part of the year commends the subcommittee’s efforts to develop when their seasonal credit needs were largest, means for encouraging an increased flow of cred­ there was some risk that lack of financing would it to minority communities, but believes that use curtail planting and subsequently aggravate the of the Federal Reserve discount window is not an inflation of food prices. Although bankers’ con­ appropriate device to accomplish this purpose. cerns about loan risk were probably more re­ Among the alternatives that are available for pro­ sponsible for their reluctance to meet loan de­ moting the subcommittee’s objectives are vari­ mands than an exhaustion of fund availability, ous proposals to establish special-purpose devel­ the Federal Reserve introduced the temporary opment banks. A more modest but highly seasonal program to make sure that smaller effective program with which the Board is espe­ banks with high loan-deposit ratios would have cially familiar is the work of the Neighborhood access to loanable funds if they needed them. Reinvestment Corporation. The Board recom­ Banks serving inner-city communities do not mends that consideration be given to expanding generally fit the specifications of this temporary this latter program and through it the activities of seasonal program. In particular, the average local Neighborhood Housing Services corpora­ term of inner-city credit needs is usually a good tions and Neighborhood Housing Services of deal longer than the six-month maximum matur­ America. ity allowed under the program. In addition, the Before turning to a discussion of such pro­ primary banking outlets for inner-city areas are posals, however, I would first like to explain why branches of banks that are larger than those eli­ use of the discount window is not an effective gible for the special program. Finally, even the instrument for helping to meet the credit needs of smaller inner-city banks that do meet the size inner-city minority communities. In your letter test for the program fall short on the loan-deposit requesting the Board to testify, you alluded to ratio test because they face less pressing loan de­ the fact that the temporary seasonal credit pro­ mands. gram introduced by the Federal Reserve in April Looking to the future, the Federal Reserve has Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

472 Federal Reserve Bulletin □ June 1980 not yet completed its plans for administering the Choices of this type clearly should be the func­ discount window after July 1 under the broader tion of the Congress working through the regular lending requirements of the new Depository In­ federal budget process and should not be dele­ stitutions Act. While a program for providing gated, through what would amount to a back­ seasonal credit will undoubtedly be continued, it door deficit-financing arrangement, to an ap­ is not likely that any practicable program of this pointive body like the Federal Reserve. type would be especially helpful to banks in in­ In contrast to credits advanced by other feder­ ner-city communities, since it would need to be al lending agencies, funds released to the econo­ pegged to a fairly significant regular seasonal pat­ my through the Federal Reserve discount win­ tern of need for funds. dow are high-powered dollars. They add directly Looking beyond the question of temporary to the reserves of the banking system and pro­ needs for funds, your letter also states that vide the base for a multiple expansion of the sup­ “ways must be found to assure that the contin­ ply of money and credit in the economy. Also, uing credit needs of minority communities are the initiative in deciding how many of these highmet.” You do not indicate whether, or in what powered dollars are released through the dis­ way, you believe the Federal Reserve discount count window rests essentially with the borrow­ window might help to meet such needs. But oth­ ers, not with the Federal Reserve. ers have been less reticent in recommending In the past the Federal Reserve generally has Federal Reserve action. They have urged the been able to use open-market sales to counter Federal Reserve to lend to private financial insti­ any unwanted fluctuations in the supply of bank tutions at below-market interest rates. Under reserves that developed from the demands of this prescription, funds provided by the Federal member bank borrowers at the discount window. Reserve would then be relent to eligible inner- But this success has reflected the rather stringent city borrowers—also at less than full market rules that now govern borrowing at the window. rates, but with an appropriate add-on to cover Generally, these rules require the borrower to the private lender’s servicing costs and loan risk. repay the Federal Reserve within a short period. Over the years we have had many similar re­ For large commercial banks, borrowings from quests from other groups at times of cyclically the Federal Reserve typically run for only one high interest rates. For example, in the current day. While smaller banks may borrow for longer year alone we have been approached with ear­ periods—particularly under the seasonal credit nest requests of this type from highly vocal program—they too generally make repayments groups representing—in addition to those con­ relatively quickly. As a result, both the size and cerned about inner-city housing needs—those the volatility of reserves released to the banking who urge Federal Reserve lending at subsidized system through the discount window have been rates to farmers, homebuilders, other small busi­ kept within manageable bounds. Any program of nesses, and businesses seeking funds for capital long-term Federal Reserve lending at below-mar­ expansion. ket rates would risk a serious erosion in this abili­ The Federal Reserve has consistently opposed ty to control the volume of bank reserves being use of its discount window to provide govern­ released through the discount window. To the ment credit to special groups at subsidized inter­ extent this happened, there would be an equally est rates. If this approach were adopted, the de­ serious erosion in the Federal Reserve’s capacity mand for subsidized Federal Reserve credit to work effectively against inflation. could be expected to mushroom dramatically. Moreover, because of the fungibility of mon­ Unfortunately, the resulting heavy expansion of ey, it would be virtually impossible for the Fed­ borrowing from the discount window would risk eral Reserve to monitor the subsidized funds pro­ serious interference with the basic ability of the vided through the discount window to assure that Federal Reserve to manage monetary policy and they were being used to finance the social pur­ thus could prove to be highly inflationary. More­ pose for which they were intended. Any serious over, the Federal Reserve would be drawn into efforts to try to monitor such lending would re­ the highly politicized process of allocating sub­ quire a substantial staff for surveillance and sidized credit among competing interest groups. would create a heavy bureaucratic burden on Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 473 both the conduit lenders and the ultimate credit troller of the Currency, and the Commerce De­ users. Finally, the Federal Reserve does not now partment. However, in addition to the ready have the statutory leeway to establish a preferred availability of funds, experience indicates that discount rate below the basic rate. The Board, successful community development efforts can therefore, believes that for it to mix responsibili­ be effective only with coordination, involve­ ty for what might become a potentially diverse ment, and commitment of both time and re­ and sometimes conflicting array of special dis­ sources by local residents, local governments, fi­ count window programs with the broader and nancial institutions, and businesses. Such efforts overriding Federal Reserve responsibility for the require the identification of potentially viable conduct of monetary policy would be a mistake. programs and projects tailored to meet local Of course, a wide variety of federal and state needs. Special expertise and knowledge are government tax-incentive and direct-subsidy needed to manage programs and projects to en­ programs already exist that are designed ex­ sure their successful completion. Finally, contin­ pressly to allocate credit to high-priority social ual monitoring of these programs is required to purposes. Since these programs have expanded guarantee that the objectives are met. sharply over the years, they tend to exert pres­ For the past few years Board members have sure on scarce resources. Fortunately, in view of served on the board of directors of the Neighbor­ the longer-run need to bring U.S. inflation under hood Reinvestment Corporation and its prede­ better control, the new federal credit budget be­ cessor, the Urban Reinvestment Task Force. came operative in the current fiscal year. For the Our experience with this corporation’s activities first time, it now sets a limit on total credit ex­ and the local Neighborhood Housing Services tended through federal programs and thus estab­ corporations it develops and assists suggests that lishes the need to allocate scarce credit among they show considerable promise as tools to foster alternative uses. community reinvestment. Within this allocation framework, setting up One of the Neighborhood Reinvestment’s new lending programs for such things as urban most successful activities to date has been to aid development may now become more difficult be­ the formation of local Neighborhood Housing cause it may involve trimming an older, more es­ Services, which have embarked upon numerous tablished program to make way for the new. activities to revitalize and refurbish inner-city Nevertheless, since the need for overall control housing. At the heart of each Neighborhood of credit programs is clear, it is now simply nec­ Housing Services corporation are four key ele­ essary to make clear that financing of urban de­ ments that have been pulled together, usually velopment should have a high priority. through the initial educational efforts of Neigh­ The nation’s experience with various attempts borhood Reinvestment. These include a core of to promote urban development and, more specif­ local residents willing and able to provide the ically, to reverse neighborhood decline indicates leadership in forming the local Neighborhood that neighborhood revitalization is indeed a com­ Housing Services corporation; a responsive local plex problem. To be successful, a cornerstone of government willing to play a role in the Neigh­ any such effort must clearly be the provision of a borhood Housing Services activities; a group of stable source of preferably low-cost, long-term financial institutions wishing to participate in funds. In addition to those now pending in the supporting the Neighborhood Housing Services Congress, numerous proposals have been made operating budget; and a revolving loan fund ad­ in the past to create an urban or community de­ ministered by the local Neighborhood Housing velopment bank. The Board feels that these pro­ Services that is designed to help meet the credit posals merit special consideration. In addition, it needs of nonbankable Neighborhood Housing would be willing to lend its expertise, if needed, Services clients. Each local Neighborhood to support the planning for such a facility, similar Housing Services is run as a nonprofit corpora­ to the support for minority banks now being pro­ tion, with a professionally trained staff experi­ vided under the Minority Bank Development enced in running community development proj­ Program in conjunction with the Federal Deposit ects. The staff answers to the coalition of local Insurance Corporation, the Office of the Comp­ residents, local government officials, and lenders Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

474 Federal Reserve Bulletin □ June 1980 who sit on the board and participate in the over­ erating budget. During coming months, the sight of the Neighborhood Housing Services. Board, along with other federal financial regulat­ Neighborhood Reinvestment’s Neighborhood ors, will continue its support through this period Housing Services programs have been unique in of economic uncertainty to ensure that the pro­ that rather than relying on federal outlays to pro­ grams’ neighborhood activities are not dimin­ vide the bulk of the funds for reinvestment, they ished just at the time of greatest need. have secured most of the funds for reinvestment Recent high interest rates have placed growing from private financial institutions, local govern­ pressure on the Neighborhood Housing Services ments, and other sources. In this way, Neighbor­ revolving loan funds that serve “unbankable” hood Reinvestment has been able to leverage homeowners. Neighborhood Housing Services substantially the federal outlays that have been of America operates a small secondary market used to start its programs. Over the first five for the Neighborhood Housing Services revolv­ years Neighborhood Reinvestment’s predeces­ ing loan funds. Grants for initial capitalization sor, the Urban Reinvestment Task Force, for ex­ and interest subsidies provided by the Neighbor­ ample, with $19 million in appropriated federal hood Reinvestment Corporation are leveraged funds produced an estimated $32 million in sup­ more than 2lh times in sales to institutional in­ port of local Neighborhood Housing Services ac­ vestors of notes collateralized by Neighborhood tivity and an excess of $119 million in private Housing Services loans. Exploration of means of reinvestment. Many of the newer projects prom­ enhancing this secondary market would be par­ ise reinvestment leverage ratios substantially ticularly worthy of congressional attention. higher than this. Admittedly, the total reinvest­ Another critical area worthy of support is the ment generated by Neighborhood Reinvestment training activity of Neighborhood Housing Serv­ activities to date is modest, but it reflects the ices of America. That organization seeks, in con­ early demonstration scale and the results of the junction with Neighborhood Reinvestment, to pilot projects. Once many of the pilot projects identify, recruit, and train management to oper­ enter the replication phase across other commu­ ate Neighborhood Housing Services. As with nities, it is expected that total reinvestment will any successful program, competent management accelerate substantially. To date, the Neighbor­ is always the key. To foster rapid expansion of hood Reinvestment Corporation has developed Neighborhood Housing Services projects, an ev­ and assisted programs in more than 90 cities er-increasing pool of qualified people is needed to serving more than 112 neighborhoods. ensure success. For this reason, high priority Although formed under the auspices of the should be given to supporting this function. Neighborhood Reinvestment Corporation, local The Board expects, in the wake of passage of Neighborhood Housing Services corporations the Community Reinvestment Act (CRA), that are not primarily financed by federal funds. They many more financial institutions will be partici­ rely on local contributions and grants for their pating in Neighborhood Housing Services and operating funds and for their revolving loan other Neighborhood Reinvestment Corporation funds. This private support, along with the active projects. Certainly, expanded participation in involvement of lenders and neighborhood resi­ these projects will be viewed favorably by the dents on the Neighborhood Housing Services Board when assessing a bank’s CRA perform­ boards, is the source of the programs’ vitality. ance. Furthermore, participation will be encour­ The federal financial regulatory agencies assist aged by our bank examiners when they perform the local programs in obtaining financial institu­ their CRA examinations, since the CRA empha­ tion involvement. For instance, Federal Reserve sizes that institutions are to make funds available Bank presidents help convene the commercial to their local communities, consistent with safe banks in each new Neighborhood Housing Serv­ and sound banking practices. Neighborhood ices development and encourage their participa­ Housing Services programs, to the extent that tion in the program. The presidents also convene they employ revolving loan pools to make the bankers to hear annual progress reports and en­ nonbankable loans to reduce the risks to finan­ courage them to continue their annual contribu­ cial institutions by engaging in tandem financing, tions to the Neighborhood Housing Services op­ are especially consistent with the objectives of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress 475 the CRA. For this reason the Board believes that vantages. The Neighborhood Reinvestment pro­ substantial untapped potential remains for addi­ grams encourage private sector involvement tional leverage of federal funds to provide for fur­ of financial institutions to make the bankable ther community reinvestment. loans rather than relying on straight federal sub­ In summary, in addition to giving close consid­ sidies. The programs provide for substantial le­ eration to the proposals to establish special-pur­ verage of federal funds as distinct from purely pose development banks, the Board would en­ inflationary federal subsidies. The programs are courage continued support of the Neighborhood easily targeted to specific projects and areas with Reinvestment Corporation and consideration of the greatest need and prospects for success. The methods to expand the availability of appropri­ programs are carefully monitored. They typically ated funds to support its development and assist­ involve projects that provide minimum dis­ ance to local Neighborhood Housing Services. placement of local residents. Finally, because of Aid should also be provided to support expan­ the structure of the programs, they permit a costsion of the local and national revolving loan benefit assessment that is not possible with in­ pools and secondary market activities as par­ direct subsidy programs such as those that might ticularly effective ways to promote communi­ potentially be implemented by providing special ty development. This policy offers several ad­ access to the discount window. □ Statement by John E. Ryan, Director, Division serve and other bank regulatory agencies by the of Banking Supervision and Regulation, Board Department of the Treasury, which has primary of Governors of the Federal Reserve System, be­ responsibility for enforcement of the statute. fore the Committee on Banking, Housing, and Among other provisions, the Bank Secrecy Urban Affairs, U.S. Senate, June 6, 1980. Act requires financial institutions to report cur­ rency transactions in excess of $10,000 to the I am pleased to appear before this committee and Treasury Department. The reporting and other to participate on behalf of the Federal Reserve requirements of the Bank Secrecy Act were de­ System in this inquiry into the effects on banks in signed to frustrate organized criminal elements South Florida of the flow of narcotics money. At by putting the spotlight on currency transactions the outset, it may be useful to the committee to that are out of the ordinary. spell out the role and responsibilities of the Fed­ As a result of its responsibilities for processng eral Reserve in these matters. In its role as a currency and coin, the Federal Reserve is able bank supervisory and regulatory agency, the to, and does, cooperate with the Treasury De­ Federal Reserve refers any evidence of possible partment by providing information concerning criminal conduct that is brought to light through currency flows into and out of the Reserve Banks its powers of examination to the appropriate law and their branches that result from the requests enforcement agency, and it is alert for such evi­ of banks for currency and coin. A recent study dence. by the Treasury Department of these flows Directly in relation to this committee’s in­ showed what appeared to be unusually heavy in­ quiry, the Federal Reserve issues, redeems, de­ flows of currency at the Miami Branch of the stroys, and processes currency for member Federal Reserve Bank of Atlanta, particularly in banks and has provided technical expertise to $50 and $100 bills, denominations that are report­ law enforcement agencies on banking matters in edly popular with narcotics operatives. Using the connection with drug-related investigations. Fur­ records of the Federal Reserve and the currency ther, the Federal Reserve has specific responsi­ transactions reports filed by banks, a number of bilities for monitoring compliance by the finan­ financial institutions in Florida were selected for cial institutions under its direct supervision with review for compliance with the Bank Secrecy the requirements of the Bank Secrecy Act. This Act. The three federal bank regulatory agencies, responsibility was delegated to the Federal Re­ including the Federal Reserve, agreed to conduct Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

476 Federal Reserve Bulletin □ June 1980 special examinations of these financial institu­ a review of the institution’s internal operations tions. and controls, the extent of controls exercised by Before beginning these special examinations, the institution itself. Any apparent weaknesses in the three agencies conducted a special training this area can trigger an examination of expanded session in Florida for the bank examiners who scope. Examiners are helped in their assessment were to be assigned the responsibility for the ex­ of an institution’s compliance by an examiner’s aminations. The training session was designed to questionnaire. That questionnaire lists each rec­ brief the examiners on expanded examination ordkeeping and reporting requirement to which techniques developed principally by the Federal the institution under examination is subject. By Reserve Bank of New York in connection with spot checking a sampling of transactions, which special investigations for compliance with the is standard examination procedure, the examiner Bank Secrecy Act that had been conducted in is able to ascertain with reasonable assurance that District. These examinations are presently whether or not the bank has complied with finan­ under way. cial recordkeeping and reporting requirements. In addition to these special examinations, Fed­ Staff of the Federal Reserve has more recently eral Reserve examiners in 1979 assisted the In­ been working closely with the staffs of both the ternal Revenue Service in a criminal investiga­ Office of the Comptroller of the Currency and the tion involving possible violations of the Bank Federal Deposit Insurance Corporation under Secrecy Act by a financial institution in Florida. the Examination Council and its task force on su­ The results of this investigation continue to be pervision in an effort to adopt uniform examina­ under review by the Treasury Department. Re­ tion procedures. The Federal Reserve proposed cently, the Atlanta Federal Reserve District, expanded examination procedures, which have which includes all of Florida, was selected as a been in use at the Federal Reserve Bank of New site for field testing of expanded examination York, for consideration by the other two procedures for determining compliance with the agencies. Staff members worked for some time to Bank Secrecy Act; the procedures are being im­ refine further these procedures. At a meeting in plemented by the banking agencies through the February 1980, the task force decided to field test Federal Financial Institutions Examination the procedures for three months beginning April 1, Council, of which the Federal Reserve is a mem­ 1980. The Federal Reserve chose for field test­ ber agency. ing purposes three Reserve Districts where the The examination procedures followed by the possibility of drug trafficking had been reported. Federal Reserve to monitor bank compliance The proposed procedures were also forwarded to with the Bank Secrecy Act have evolved over the remaining Reserve Districts for use in those time and have expanded as our experience with instances when examiners, as part of the present enforcement has broadened. Beginning with the scope of examination, uncovered what they felt passage of the Bank Secrecy Act, Federal Re­ could be strong indications of noncompliance. serve examiners were instructed in the act’s The expanded procedures are attached. requirements in examination schools and were The committee specifically asked that the mat­ provided with examination procedures to check ter of assistance provided to the state bank regu­ compliance. In March 1976, representatives from latory agencies in dealing with bank problems the federal banking regulatory agencies and the stemming from drug-related money be ad­ Department of the Treasury designed more de­ dressed. As previously indicated, the Bank Se­ tailed examination guidelines, which were for­ crecy Act is a federal statute with compliance re­ warded to the examiners for implementation. sponsibilities delegated to the federal bank (See Attachment I.)1 regulatory agencies. In the case of the Federal These procedures may be summarized as fol­ Reserve, many examinations are conducted con­ lows. Initially, the examiner determines, through currently with examiners from the state banking departments. On these concurrent examinations, the state authorities would be fully informed of 1. The attachments to this statement are available on re­ Federal Reserve findings and recommendations. quest from Publications Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. When examinations are conducted independent­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Statements to Congress All ly, state authorities are provided with copies of • Criticized 45 institutions for not maintaining the Federal Reserve’s examination reports that a list of customers who are exempt from report­ would contain criticisms of noncompliance with ing such transactions. the Bank Secrecy Act. • Responded to four requests from the De­ We believe that, judging from the record, the partment of the Treasury for additional informa­ Federal Reserve has made every effort to coop­ tion regarding apparent violations. erate with drug enforcement agencies and has In spite of certain instances of noncompliance, conscientiously enforced the requirements of the we believe that the overwhelming majority of Bank Secrecy Act. In the New York Reserve senior management of the financial institutions District, three special investigations of state under the supervision of the Federal Reserve do member banks have been concluded. One of not knowingly permit their institutions to be used these investigations culminated in an indictment as vehicles for laundering narcotics-related mon­ and a fine of the financial institution. In addition, ies. Moreover, those cited for noncompliance the Federal Reserve is required to report to the have responded to examiner criticism and have staff of the Department of the Treasury on a instituted corrective action to insure future com­ quarterly basis. That report contains (1) a list of pliance with the Bank Secrecy Act. those banks that have been cited for apparent In the final analysis, we do not believe our violations of certain reporting and recordkeeping bank examiners, or the bankers themselves requirements of the regulations; and (2) bank for that matter, can be 100 percent certain that management’s plans to enhance internal control narcotics-related monies are not flowing through mechanisms so as to effect future compliance the banks. As we all know, currency, being fun­ with the law. A review of the reports submitted gible with no lasting identity to any particular from December 31, 1978, through March 31, transaction, is extremely difficult to trace, and 1980, indicates that the Federal Reserve has ac­ there could be an infinite number of ways for the complished the following: dishonest to frustrate or circumvent necessarily rigid statutory or regulatory requirements. Nev­ • Examined 1,197 financial institutions, during ertheless, we share the committee’s concern the process of which compliance with the Bank over the obvious adverse effects that the flow of Secrecy Act was checked. illicit monies has on the integrity of financial in­ • Cited 19 institutions for not filing currency stitutions and will continue to strive to improve transaction reports for transactions in excess of our examination techniques to insure compliance $10,000. with the relevant laws and regulations. □ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

478 Announcements percent, effective May 29, 1980. The action was L yle E. Gramley: taken entirely in reflection of recent substantial Appointment as a Member declines in short-term market interest rates to of the Board of Governors levels well below the existing discount rate. In making this technical change, the Board act­ President Carter on February 29, 1980, an­ ed on requests from the directors of the Federal nounced his intention to appoint Lyle E. Reserve Banks of Boston, Philadelphia, Cleve­ Gramley as a member of the Board of Governors land, Richmond, Atlanta, Chicago, St. Louis, of the Federal Reserve System. Mr. Gramley Minneapolis, Kansas City, Dallas, and San Fran­ was subsequently confirmed by the Senate on cisco. (The Board subsequently approved similar May 14. The oath of office was administered by action by the directors of the Federal Reserve Vice President Mondale on May 28 in the Bank of New York, effective May 30.) The dis­ Board’s offices. The text of the White House an­ count rate is the interest rate that member banks nouncement follows: are charged when they borrow from their district Federal Reserve Bank. The President has announced his intention to nomi­ nate Lyle E. Gramley to be a member of the Board of Governors of the Federal Reserve System for a 14year term. He would replace Philip Coldwell, whose Com pliance w ith th e term has expired. 1980 R equirem ents o f the Gramley has been a member of the President’s Bank H olding Company A ct Council of Economic Advisors since 1977. He was born January 14, 1927, in Aurora, Illinois. He received a B.A. from Beloit College in 1951 and an The Federal Reserve Board on May 12, 1980, is­ M.A. (1952) and Ph.D. (1956) from Indiana University. sued a program for the guidance of bank holding From 1955 to 1962 Gramley was a financial econo­ companies that have divestiture obligations to mist with the Federal Reserve Bank of Kansas City. meet by December 31, 1980, under the terms of From 1962 to 1964 he was an associate professor of economics at the University of Maryland. From 1964 the 1970 amendments to the Bank Holding Com­ to 1965 he was a senior economist with the Board of pany Act. Governors of the Federal Reserve System. The Board set forth, in the form of a policy From 1965 to 1977 Gramley was with the Division of statement, the program it intends to follow Research and Statistics of the Federal Reserve Board, in the final six months before the December beginning as an associate advisor and finally serving as director of the division. 31, 1980, deadline, in the interests of orderly Gramley is the author of several publications on ec­ compliance and effective Board monitoring. onomics. He is a member of the American Economic The 1970 amendments to the Bank Holding Association and the National Economists Club. Company Act provided that companies that be­ Mr. Gramley was appointed from the Tenth came bank holding companies by virtue of those Federal Reserve District (Kansas City) and re­ amendments (that is, one-bank holding com­ places Philip E. Coldwell, whose term expired in panies) and that had acquired nonbank activities January 1980. between June 30, 1968, and December 30, 1970, had until December 31, 1980, to (1) divest such nonbank activities, or (2) get Board approval to Change in Discount Rate keep them, or (3) cease to be a bank holding com­ pany by divesting their bank holdings. The Federal Reserve Board approved a reduc­ The Board has twice earlier (in December 1978 tion in the discount rate from 13 percent to 12 and December 1979) warned bank holding com­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

479 panies that had not filed plans for complying with the framework of the basic monetary and credit the 1980 divestiture requirements that, to avoid objectives of the Federal Reserve and the special forced liquidation resulting from last-minute ef­ measures of credit restraint established last forts to comply, they should file compliance March 14. The Federal Reserve has accordingly plans with the Board well in advance of the dead­ modified and simplified the administration of the line. The Board’s policy statement, which affects special program. some 200 bank holding companies, provides the These actions do not represent any change in following: basic monetary policy as reflected in the targets 1. Applications to retain nonbanking sub­ for restrained growth in money and credit over sidiaries or activities subject to the 1980 divesti­ 1980 that were developed early this year to help ture requirements should be submitted to the ap­ bring inflation under control. propriate Federal Reserve Bank by July 1, 1980. The actions are consistent with the intent to Failure to meet this deadline will be considered phase out those special and extraordinary mea­ by the Board to be a declaration by the company sures only as conditions clearly permit. There­ that it does not intend to retain the subsidiary or fore, the basic framework of the special March activity. Further, the Board expects affected measures remains. These were established in companies to be actively engaged in divestiture part in conjunction with the action of the Presi­ or discontinuance of impermissible activities or dent to invoke certain provisions of the Credit subsidiaries that it does not intend to retain, in­ Control Act of 1969. cluding those it has not applied to retain. Actions taken by the Board of Governors were 2. The Congress has recently provided a spe­ as follows: cial exemption for bank holding companies with 1. A reduction in the marginal reserve require­ real estate holdings. This permits the Board to ment on managed liabilities of large member extend the 1980 deadline to December 31, 1982, banks and of agencies and branches of foreign for divestiture of such interests when the Board banks from 10 percent to 5 percent, and an up­ finds the company has made continuing good- ward adjustment of l lh percent in the base upon faith efforts to divest and the extension is neces­ which the reserve requirement is calculated. sary to avert substantial loss to the company. 2. A reduction in the special deposit require­ Bank holding companies wishing to take advan­ ment on managed liabilities of large nonmember tage of this special provision must submit a institutions from 10 percent to 5 percent, togeth­ request to the Board to do so by July 1, 1980, er with a similar upward adjustment in their base. together with information to enable the Board to 3. A decrease from 15 percent to l lh percent evaluate the request. in the special deposit requirement that applies to 3. Bank holding companies with nonbanking increases in covered consumer credit. subsidiaries or activities subject to the 1980 di­ 4. A decrease from 15 percent to l xh percent vestiture requirements, but that have not filed in the special deposit requirement that applies to applications or requests to retain by July 1, 1980, increases in covered assets of money market mu­ must begin to file monthly progress reports on tual funds and other similar institutions. August 1, 1980. The reports, to be filed in letter 5. Modification of the special credit restraint form with the appropriate Reserve Bank, should program to ensure that more urgent credit needs describe actions of the company undertaken to are being met—such as those for small business, divest either the nonbanking activity or the bank. auto dealers and buyers, the housing market, ag­ Letters are to be filed with the Reserve Banks on riculture and energy products, and con­ the first day of each month. servation—and to reduce reporting burdens of commercial banks. The lower marginal reserve requirement on the Credit Restraint Program: Changes managed liabilities of member banks and foreign agencies and branches will apply to liabilities ef­ Evaluation of recent banking and other credit fective with the statement week of May 29-June data, including trends in consumer credit, in­ 5. Effective that week also, the marginal reserve dicates that current developments are well within base will be increased by l lh percent above the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

480 Federal Reserve Bulletin □ June 1980 base used to calculate the marginal reserve in the Regulation Z. Actions statement week of May 14-21. Declines in outstanding loans to foreigners The Federal Reserve Board on May 16, 1980, an­ will continue, as before, to reduce the base in nounced four actions under the Truth in Lending subsequent weeks. The upward adjustment does Simplification and Reform Act. Three of the ac­ not apply to the $100 million minimum base tions were effective May 21; the fourth is a pro­ amount. posal. All the actions affect the Board’s Regula­ The same effective date and adjustment in base tion Z, which implements the Truth in Lending will apply to nonmember banks subject to the Act and is being revised in light of the Sim­ special deposit requirement on increases in man­ plification Act. aged liabilities. The Truth in Lending Simplification and Re­ The new special deposit requirement on cov­ form Act (Title VI of the Depository Institutions ered consumer credit will be effective beginning Deregulation and Monetary Control Act), signed with the average amount of credit outstanding in into law March 31, 1980, becomes fully effective June, with the special deposit due July 24. For April 1, 1982. The act requires the Board to have money market funds, the new requirement will implementing regulations in place by April 1, be effective with assets in the week beginning 1981. Creditors may however comply with the June 16, and the deposit will be maintained in the Board’s regulations under the Simplification Act week beginning June 30. when the Board has taken final action on regula­ tions to implement the act. The four actions are as follows: Regulation E: Amendment 1. An amendment of Regulation Z that ex­ empts all extensions of credit for agricultural The Federal Reserve Board on May 8, 1980, purposes from the disclosure requirements of amended its Regulation E (Electronic Fund Truth in Lending. Currently, only agricultural Transfers) to remove the requirement for extensions over $25,000 are exempt from Truth receipts given at the point of sale in electronic in Lending disclosure requirements. The Board’s transfers to identify the type of account being action eliminates the need for any Regulation Z charged. Rules regarding the use of debit cards at disclosures for agricultural credit of any amount. automatic tellers are not affected. However, because certain state laws governing Debit cards can be used to make purchases at agricultural credit have been preempted under department stores or elsewhere through elec­ Regulation Z and because the Congress wished tronic terminals that debit (charge) the custom­ to give creditors time to adjust their practices, er’s account at the financial institution that is­ the Board, in eliminating the disclosure require­ sued the card. ment for agricultural credit, gave creditors two Regulation E would have required, effective options. They may either cease to make dis­ May 10, that the receipt furnished to a consumer closures under Regulation Z but comply with any who uses a debit card to make a point-of-sale currently preempted state laws, or continue to transaction identify the type of account (for in­ provide the federal Truth in Lending disclosures, stance checking or savings account) that is being disregarding any inconsistent state laws until the charged. effective date of the Simplification Act. It has come to the Board’s attention that com­ 2. An amendment to the regulation to elimi­ pliance with this requirement would be impracti­ nate disclosure requirements currently imposed cable, as debit cards contain no indication of the upon periodic statements that lenders provide in type of account to be charged. Further, the iden­ connection with closed-end credit transactions tification of the type of account would be of little (such as mortgage and personal loans). Since value to the cardholder because the cardholder there appear to be no state laws that would com­ agrees with the financial institution issuing the plicate immediate discontinuation of disclosure card that one and only one account will be requirements for periodic statements on closedcharged when point-of-sale transactions are end credit and since the intent of the Congress made. was to simplify Truth in Lending by eliminating Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 481 those disclosures, the Board believes prompt im­ knowledge, interests, or experience relating to plementation is appropriate. (The disclosure re­ consumer matters. quirements for periodic statements on open-end The Consumer Advisory Council was estab­ credit are not affected.) lished by the Congress in 1976, at the suggestion 3. Extension of the life of the Board’s rule re­ of the Board, to advise the Board on the exercise garding the right of rescission. A provision of of its duties under the Consumer Credit Pro­ Regulation Z that allows an exception to the tection Act and on other consumer-related mat­ “cooling off” period for consumers who pledge ters. Generally, the council meets four times a their homes as collateral in open-end credit ar­ year for about a day and a half. rangements was to be revoked on May 31. Since the Simplification Act, when effective, will provide a similar exception to the rescission Adjustment of rule, the Board has extended the life of its rescis­ Interest Rate Ceilings sion rule until the act becomes effective. The Board noted that adoption of these three The Depository Institutions Deregulation Com­ rules on May 21 does not mean that creditors mittee on May 29, 1980, announced a number of may now follow other provisions of the Sim­ interrelated actions for adjusting interest rate plification Act. Creditors may follow the provi­ ceilings as a step toward giving the public a mar­ sions of the revised act only when the proposals ket return on savings. published by the Board on April 28 (May 5 in the The committee1 said that these actions are Federal Register) to overhaul Regulation Z in aimed, within this context, at helping depository light of the Simplification Act have been adopted institutions compete for deposits more ef­ in final form. These proposals included proposed fectively, to enhance the ability of small banks to model forms, but these forms are not in effect serve the agricultural and small business needs of until the Board takes final action upon them. their communities, to help thrift institutions in­ 4. Proposal. The Board requested comment crease liquidity, and to permit banks and savings by June 20, 1980, on a proposal to amend Regula­ institutions to serve better the nation’s needs for tion Z to increase the tolerance for accuracy in financing homebuilding and homeownership. disclosure of the annual percentage rate in mort­ The committee’s actions affect the six-month gage transactions involving irregular payments floating-ceiling money market certificate (MMC), or advances. the 2V2-year-and-longer floating-ceiling small savers certificate (SSC), and the penalty for early withdrawal of funds from time deposits. These Nominations to actions are as follows: Consumer Advisory Council Money market certificate.2 The new rule con­ The Federal Reserve Board has announced that sists of the following provisions: it is seeking additional nominations of qualified individuals for eight appointments to its Con­ 1. Members of the committee are the Secretary of the sumer Advisory Council. Nominations received Treasury, and the chairmen of the Federal Reserve Board, Federal Deposit Insurance Corporation, Federal Home Loan will be added to the list of nominees submitted in Bank Board, and the National Credit Union Administration 1979. Board. The Comptroller of the Currency is a nonvoting mem­ Nominations should be submitted in writing to ber of the committee. 2. The money market certificate, established in June 1978, Janet Hart, Director, Division of Consumer and is issued weekly by financial institutions in minimum denomi­ Community Affairs, Board of Governors of the nations of $10,000 and matures in twenty-six weeks. Its yield Federal Reserve System, Washington, D.C. varies according to the yield of the six-month Treasury bill. Before the committee’s action the MMC ceiling was the same 20551, and must be received no later than August as the bill rate for commercial banks at all yields and for thrift 1, 1980. institutions at bill rates of 9.01 or more. When the bill rate Nominations should include the name, ad­ was between 8.75 and 9.00 percent, thrift institutions could pay 9.00 percent, and when the bill rate was 8.74 percent or dress, and telephone number of the nominee, less thrift institutions could pay lU of 1 percent above the bill past and present positions held, and special rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

482 Federal Reserve Bulletin □ June 1980 1. All institutions may pay at least 25 basis tion of six-month bills and will continue to be ef­ points above the six-month Treasury bill rate fective on the Thursday following the Monday (weekly auction average). auction. The new ceiling rules are effective for 2. All institutions may pay the same ceiling MMCs issued beginning June 5. rate when the Treasury bill rate is 8.75 percent or higher. Small saver certificate.3 With the object of giv­ 3. The ceiling rate will drop no lower than 7.75 ing more for their money to small savers using percent, thus establishing a minimum ceiling that this low-initial-deposit certificate, the committee will permit all institutions to operate in a free revised its terms as follows: market when the six-month bill rate is less than 1. Minimum ceiling rates of 9.25 percent for 7.25 percent. commercial banks and 9.50 percent for thrift in­ 4. A differential favoring thrift institutions will stitutions were established. That is, even when be part of the ceiling structure when the six- the rate for Treasury issues with a maturity of month bill rate is between 7.25 percent and 8.75 2xh years falls below rates at which these ceilings percent. would be activated, thrift institutions and com­ When the bill rate is 8.75 percent or more, both mercial banks would not be forced to pay less thrift institutions and commercial banks may pay than the minimum ceiling rates although they can 25 basis points over the bill rate, and when the pay less if they wish to do so. These “floor” bill rate is 7.26 percent up to 8.74 percent, a dif­ rates would be effective at the current Treasury ferential of as much as 25 basis points may exist 2V2-year rate and therefore, beginning June 2, between rates that commercial banks and thrift commercial banks may pay 9.25 percent and thrift institutions may pay. This is described in the institutions may pay 9.50 percent. table. 2. The scale of interest that can be paid for the SSC was generally increased 50 basis points. Be­ tween the minimum and the cap rates (see 4 be­ Ceiling rate schedules for MMCs low), thrift institutions may pay the Treasury Percent rate on 2V2-year issues, rather than half a point Ceiling under the Treasury rate, and commercial banks Bill rate Differential Commercial banks ins T ti h tu r t if i t ons may pay 25 basis points, rather than 75, less than the Treasury rate. 8.75 and above.... BR + 25 bp BR + 25 bp 0 8.50 to 8.75.......... BR + 25 bp 9.00 0 to 25 bp 3. The SSC ceiling rates will be set biweekly 7.50 to 8.50.......... BR + 25 bp BR + 50 bp 25 bp rather than monthly. 7.25 to 7.50.......... 7.75 BR + 50 bp 25 bp to 0 Below 7.25.......... 7.75 7.75 0 4. The existing “cap” on the interest rates that may be paid on the SSC—12 percent for BR = bill rate, thrift institutions and 11.75 percent for com­ bp = basis points. mercial banks—was continued unchanged. That is, even if the rate on Treasury issues with matu­ A minimum ceiling rate of 7.75 percent has rities of 2lh years rises beyond the point at which been established. That is, should the Treasury these ceilings would be activated, financial insti­ six-month bill rate fall to, say, 7 percent, the min­ tutions could not pay more on the SSC than the imum ceiling would still be 7.75 percent for both cap rates. commercial banks and thrift institutions. As al­ 5. Institutions may continue to compound the ways, banks or thrift institutions may pay less rate period. than the ceiling if they wish. During the next six months, commercial banks 3. The small saver certificate, established in 1979, is issued may renew maturing MMCs with the same de­ by thrift institutions and commercial banks in maturities of 30 months or more. Before the committee’s action the ceiling positor at an MMC rate equal to the ceiling rate rate for the SSC was the rate for Treasury issues with a matu­ for thrift institutions. This applies only to renew­ rity of 2V2 years, less 3U of 1 percent for commercial banks als by the same depositor. and V2 of 1 percent for thrift institutions. There is no mini­ mum denomination: issuers may sell the SSC in whatever The ceiling rates will continue to be estab­ amounts they wish. This feature has made it attractive to sav­ lished by the result of the weekly Treasury auc­ ers with only small amounts to deposit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 483 The SSC ceiling rates will be announced on lications Services, Board of Governors of the Mondays and be effective the following Thurs­ Federal Reserve System, Washington, D.C., day. The new rules are effective for SSCs issued 20551, or from any Federal Reserve Bank. beginning June 2. Penalty for early withdrawal of funds from Proposed Actions time deposits. The penalty for withdrawal of funds from a time deposit before its maturity will The Federal Reserve Board on June 4, 1980, is­ be an amount equal to three months’ simple, sued for public comment a proposed Regulation nominal interest when the original maturity is D designed to carry out the provisions for re­ one year or less and six months’ simple, nominal serve requirements in the Monetary Control Act interest when the original maturity is longer. In of 1980. Comment should be received by July 15. the past, the minimum required penalty did not The Federal Reserve Board on June 10, 1980, exceed interest accrued or already paid. Under proposed major revisions in its rules governing the new rule, the penalty may require a reduction extensions of credit through the discount win­ in the principal sum of the account. For example: dow to carry out provisions of the Monetary If a depositor withdraws funds from a one-year Control Act of 1980. Comment should be re­ deposit after one month, the penalty would be an ceived by July 15. amount equal to three months’ interest even though that much interest had not yet been earned, and a reduction in principal would be necessary. The penalty is in terms of interest on Change in Board Staff the amount withdrawn. This rule is effective be­ ginning June 2. The Board of Governors has announced the resignation of James M. Brundy, Deputy Associ­ ate Director, Division of Research and Statistics. New Consumer Pamphlet The Federal Reserve Board has announced the latest in its series of consumer publications, System Membership: “Alice in Debitland,” which explains consumer Admission of State Banks protections under the Electronic Fund Transfer Act. The following banks were admitted to member­ Alice’s adventure with electronic money in­ ship in the Federal Reserve System during the cludes descriptions of EFT systems in operation period May 11, 1980, through June 10, 1980: and answers to consumer questions about loss or Virginia theft of EFT cards, error-correction procedures, Henrico County.....................Suburban Bank and records of electronic payments. It also sup­ West Point.........................Bank of West Point plies helpful tips to consumers using EFT. Texas Copies of the pamphlet may be obtained singly Richmond.............................Community Bank or in limited quantity free of charge from Pub­ Fort Bend County Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

484 Record of Policy Actions of the Federal Open Market Committee Meeting held on April 22,1980 about 4 percentage points below its recent high in March 1979. Domestic Policy Directive Nonfarm payroll employment de­ The information reviewed at this clined appreciably in March follow­ meeting suggested that economic ac­ ing a substantial rise earlier in the tivity turned down in the latter part year, and the rate of unemployment of the first quarter of 1980. For the rose 0.2 percentage point to 6.2 per­ quarter as a whole, however, real cent. Employment in manufacturing gross national product grew at an an­ fell somewhat in March after chang­ nual rate of about 1 percent, accord­ ing little in January and February, ing to preliminary estimates of the and the length of the average work­ Commerce Department, compared week was reduced for the second with a rate of 2 percent in the fourth consecutive month. quarter of 1979. The rise in average prices, as mea­ Retail sales on a constant-dollar sured by the fixed-weight price index basis fell sharply in February and for gross domestic business product, March, after having increased in accelerated to an annual rate of January, and were estimated to have about 12 percent in the first quarter declined over the first quarter as a from a rate of about 10 percent dur­ whole. Unit sales of new automo­ ing 1979. Producer prices of finished biles slowed in both February and goods and consumer prices rose at March from a brisk pace in January annual rates of about 19 percent and and apparently remained weak in 18 percent respectively during the early April. first quarter. The advances reflected Private housing starts fell consid­ a continuing surge in prices of ener­ erably in January and February and gy-related items and substantial in­ dropped sharply further in March to creases in prices of numerous other an annual rate of just over one mil­ items. The index of average hourly lion units, about 40 percent less than earnings of private nonfarm produc­ in the second and third quarters of tion workers rose at an annual rate 1979 and the lowest rate since April of 9V2 percent during the first quar­ 1975. Building permits for new units ter, compared with a rise of about also declined substantially further in 8V2 percent during 1979. March. In February sales of single­ In foreign exchange markets the family homes fell for the fifth con­ strong demand for dollars that secutive month. emerged in mid-February persisted The index of industrial production through early April, but some selling fell 0.8 percent in March, after pressure developed in the second changing little on balance in other re­ week of April, in large measure be­ cent months. The March decline re­ cause accumulating signs of a reces­ flected widespread cutbacks in out­ sion in the United States led many put of final products and materials. market participants to conclude that The rate of capacity utilization in U.S. interest rates had peaked. De­ manufacturing fell nearly 1 percent­ spite the recent weakening of the age point in March to 83 percent, dollar, its trade-weighted value Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

485 against major foreign currencies was spectively in March, and available currently about 5 percent above its data suggested further contraction in level of early February. early April. Growth in M-2 slowed The U.S. foreign trade deficit rose from an annual rate of 103/4 percent further in February following a sharp in February to Vh percent in March, increase in January. The marked in­ reflecting mainly the contraction in crease over the first two months of the narrow measures of the money 1980 reflected a surge in imports, as­ stock. Growth in money market mu­ sociated in large part with rising tual funds slowed markedly on a prices, that was only partly offset by monthly average basis, but the im­ a moderate expansion in exports. pact on M-2 was offset by greater At its meeting on March 18, the strength in small-denomination time Committee had agreed that open deposits, principally reflecting rapid market operations in the period until growth in money market certificates. this meeting should be directed to­ From December to March, M-l A ward expansion of reserve aggre­ and M-1B grew at annual rates of gates consistent with growth over about 4 percent and Alh percent re­ the first half of 1980 at annual rates spectively, and M-2 expanded at a of 4V2 percent for M-l A and 5 per­ rate of 7 percent. cent for M-1B, or somewhat less, Expansion of total credit out­ provided that in the intermeeting pe­ standing at U.S. commercial banks riod the weekly average federal slowed substantially in March after funds rate remained within a range accelerating earlier in the year. The of 13 to 20 percent. In the Com­ slowdown was especially pro­ mittee’s view, this short-run policy nounced for business loans, but should be consistent with growth in growth in real estate loans also mod­ M-2 at an annual rate of about VU erated appreciably. Overall expan­ percent over the first half of the sion in short-term business credit year. remained relatively strong as non­ During the first part of the inter­ financial corporations continued to meeting period, demands for bank issue large amounts of commer­ reserves continued strong in relation cial paper. to the supply being made available Most market interest rates de­ through open market operations, clined considerably on balance dur­ and the federal funds rate rose from ing the intermeeting period. Follow­ an average of \6lU percent in the ing the Committee’s meeting on statement week ending March 19 to March 18, interest rates extended about 193/s percent in the week end­ earlier advances and reached new ing April 2. Subsequently, the de­ highs in late March or early April. mand for bank reserves eased, and Subsequently, most interest rates the funds rate dropped to an average turned down, with the federal funds of about 183/s percent in the week rate falling moderately and other ending April 16. Member bank bor­ rates declining sharply as market rowings averaged around %2lU bil­ participants reacted to accumulating lion in the three statement weeks signs of a slowdown in economic ac­ ending April 16, down from an aver­ tivity and to weakening in the mone­ age of about $3V4 billion in the pre­ tary aggregates. During the period ceding two weeks. commercial banks initially raised The monetary aggregates weak­ their loan rate to prime business bor­ ened substantially in March after rowers from I8V2 percent to 20 per­ growing at accelerated rates in Feb­ cent and then lowered it to 19V2 per­ ruary. M-l A and M-1B, which had cent. In primary markets for home expanded at annual rates of around mortgages, average rates on new 12 percent in February, declined at commitments leveled out at around annual rates of Vh and 2 percent re­ I6V2 percent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

486 Federal Reserve Bulletin □ June 1980 Staff projections prepared for this peared to be consistent with broad meeting suggested that real GNP economic aims: M-l A, Vh to 6 per­ would decline in the current quarter cent; M-1B, 4 to 6V2 percent; M-2, 6 and continue to move lower for a to 9 percent; and M-3, 6V2 to 9V2 number of quarters. The contraction percent. The associated range for in activity was projected to be some­ the rate of growth in commercial what larger than had been antici­ bank credit was 6 to 9 percent. It had pated a month earlier and to be ac­ also been agreed that the longer-run companied by a substantial increase ranges, as well as the particular ag­ in unemployment. The rise in aver­ gregates for which such ranges were age prices was projected to remain specified, would be reconsidered in rapid, although some moderation July or at any other time that condi­ was expected after the current quar­ tions might warrant, and also that ter. short-run factors might cause con­ In the Committee’s discussion of siderable variation in annual rates of the economic situation, the judg­ growth from one month to the next ment was broadly shared that a de­ and from one quarter to the next. cline in overall activity had probably In contemplating policy for the pe­ begun, especially in light of new evi­ riod immediately ahead, the Com­ dence that had accumulated since mittee took note of a staff analysis the Committee’s meeting in March. indicating that M-l A and M-1B were It was emphasized, however, that likely to decline further on the aver­ uncertainties concerning the outlook age in April and, consequently, that persisted and that, in any case, fore­ growth over the first four months of casting the severity and duration of a the year would fall considerably recession was always difficult. short of the objectives for the first The degree of prospective weak­ half of the year established by the ness in consumer spending was viewed Committee at its meeting in March. as a major source of uncertainty. Thus, realization of those objectives The anti-inflationary measures an­ would require substantial expansion nounced on March 14 appeared in M-l A and M-1B over May and to have curbed considerably spend­ June. A significant rebound in their ing in anticipation of price increases. growth was likely over the two- It was noted in this connection that a month period, given the staff projec­ rise in the saving rate from the ab­ tion of a fairly sizable expansion in normally low levels of the most re­ nominal GNP in the current quarter cent two quarters to a more normal and the associated increase in the rate would imply a marked cutback transactions demand for money, but in consumer spending. Such a devel­ efforts to realize the first-half objec­ opment would also tend to depress tives for growth established in business investment in inventories March could require System open and plant and equipment. However, market operations that would put it would be premature to conclude further downward pressure on the that inflationary attitudes and behav­ federal funds rate. The staff analysis ior had been fundamentally altered, also suggested that growth of M-2 especially in view of the prospect over the half year was likely to be that the rapid rise in the consumer lower in relation to growth of the price index would persist for a num­ narrower monetary aggregates than ber of months. had been thought a month earlier, At its meeting on February 4-5, owing to a scaling down of expected 1980, the Committee had agreed that expansion in money market mutual from the fourth quarter of 1979 to the funds. fourth quarter of 1980 average rates In the Committee’s discussion of of growth in the monetary aggre­ policy for the period immediately gates within the following ranges ap­ ahead, most members favored reaf­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 487 firming the monetary growth objec­ the view was expressed that the pos­ tives for the first half of 1980 that had sibility of downward pressure on the been established at the previous dollar in association with a relative meeting, but some sentiment was al­ decline in U.S. interest rates would so expressed for lower rates of mon­ have to be faced sooner or later. On etary growth. The members general­ the other hand, some decline in U.S. ly accepted the view that retention interest rates might already have of the earlier objectives for mone­ been discounted, and exchange mar­ tary growth was likely to be associ­ kets should in any event be reas­ ated with further downward pres­ sured by the general thrust of mone­ sure on interest rates. tary policy and the prospect for Several members noted their con­ improvement over time in the per­ cern that if a large decline in interest formance of the current account. It rates were to occur over the next was also noted that U.S. interest few weeks, it was likely to be per­ rates remained higher than key inter­ ceived by some market partici­ est rates abroad. pants—depending upon which vari­ In light of the outlook for a some­ ables they thought important—as an what lower federal funds rate in the easing of monetary policy and could weeks immediately ahead, most have very undesirable repercussions members believed it would be appro­ on inflationary psychology and on priate to reduce the upper limit of the dollar in foreign exchange mar­ the current range, and several mem­ kets. Such a decline in interest rates bers suggested 19 percent for the could ultimately prove especially new upper limit. Most members ex­ troublesome and unsettling to finan­ pressed a preference for retaining cial markets if after a short interval a the current lower limit of 13 percent. stronger-than-expected resurgence At the conclusion of the dis­ in monetary and credit expansion led cussion, the Committee agreed that to its reversal. The view was also ex­ open market operations in the period pressed that the course of economic until the next meeting should contin­ activity would not be adversely af­ ue to be directed toward expansion fected if any decline in interest rates of reserve aggregates consistent with were gradual rather than precipi­ growth over the first half of 1980 at tous. annual rates of Axh percent for M-1A Other members, however, stressed and 5 percent for M-1B, or some­ the risk that a continued short­ what less, provided that in the inter­ fall in monetary growth and per­ meeting period the weekly average sistence of relatively high interest federal funds rate remained within a rates could exacerbate recessionary range of 13 to 19 percent. Consistent forces in the economy. It was ob­ with this short-run policy, in the served that a significant decline in in­ Committee’s view, M-2 should grow terest rates, if that were to occur in at an annual rate of about &U per­ coming weeks, should be regarded cent over the first half, and expan­ as a consequence of the Com­ sion of bank credit should slow in mittee’s continuing emphasis on its the months ahead to a pace compat­ announced objectives for achieving ible with growth over the year as a limited monetary growth and not as whole within the range of 6 to 9 per­ a shift toward a stimulative policy. cent agreed upon. It was generally The Committee’s monetary objec­ recognized that conditions could tives should be perceived as fully arise that might make desirable a re­ consistent with a moderation of in­ view of the situation in advance of flationary forces over time as well as the next regular meeting scheduled with resistance to recessionary ten­ for May 20. In any case, if it ap­ dencies in the short run. With re­ peared that the constraint on the fed­ spect to foreign exchange markets, eral funds rate was inconsistent with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

488 Federal Reserve Bulletin □ June 1980 the objective for the expansion of re­ expansion and contributing to a sustain­ serves, the Manager for Domestic able pattern of international transac­ tions. At its meeting on February 4-5, Operations was promptly to notify 1980, the Committee agreed that these the Chairman who would then de­ objectives would be furthered by growth cide whether the situation called for of M-l A, M-1B, M-2, and M-3 from the supplementary instructions from the fourth quarter of 1979 to the fourth quar­ Committee. ter of 1980 within ranges of VI2 to 6, 4 to 6V2, 6 to 9, and 6V2 to 9V2 percent re­ The following domestic policy di­ spectively. The associated range for rective was issued to the Federal Re­ bank credit was 6 to 9 percent. serve Bank of New York: In the short run, the Committee seeks expansion of reserve aggregates consis­ The information reviewed at this tent with growth over the first half of meeting suggests that economic activity 1980 at an annual rate of A112 percent for turned down in the latter part of the first M-l A and 5 percent for M-1B, or some­ quarter of 1980, although for the quarter what less, provided that in the period be­ as a whole real GNP expanded some­ fore the next regular meeting the weekly what further and the rise in prices accel­ average federal funds rate remains with­ erated. Retail sales in real terms declined in a range of 13 to 19 percent. The Com­ sharply in February and March, after mittee believes that, to be consistent having increased in January. In March with this short-run policy, M-2 should industrial production and nonfarm pay­ grow at an annual rate of about 63/4 per­ roll employment declined, and the cent over the first half and that bank unemployment rate edged up to 6.2 per­ credit should grow in the months ahead cent. Private housing starts declined at a pace compatible with growth over throughout the first quarter, to a rate in the year as a whole within the range March about two-fifths below that in the agreed upon. third quarter of last year. The rise in pro­ If it appears during the period before ducer prices of finished goods and in the next meeting that the constraint on consumer prices was considerably more the federal funds rate is inconsistent with rapid during the first three months of the objective for the expansion of re­ 1980 than in 1979. Over the first quarter, serves, the Manager for Domestic Oper­ the rise in the index of average hourly ations is promptly to notify the Chairman earnings was somewhat above the rapid who will then decide whether the situa­ pace recorded in 1979. tion calls for supplementary instructions The strong demand for the dollar in from the Committee. exchange markets that began in mid- February persisted through early April. Votes for this action: Messrs. Volck- Some selling pressure developed in the er, Guffey, Morris, Partee, Rice, second week of April as market partici­ Roos, Schultz, Solomon, Mrs. Teeters, pants reacted to indications that U.S. in­ and Mr. Winn. Vote against this ac­ terest rates might have peaked, but tion: Mr. Wallich. the trade-weighted value of the dollar against major foreign currencies re­ Mr. Wallich dissented from this mained well above its level of early Feb­ action because he believed that it ruary. The U.S. foreign trade deficit rose represented a premature and exces­ further in February. sive relaxation of restraint. He fa­ M-l A and M-1B, which had expanded vored a policy for the period until sharply in February, contracted in March and early April; M-2 increased relative­ the next meeting directed toward ly little in March. From December lower rates of monetary growth over to March, M-l A and M-1B grew at the first half of the year, accom­ annual rates of about 4 percent and A112 panied by an intermeeting range for percent respectively, and M-2 grew at a rate of 7 percent. Expansion of com­ the federal funds rate that would al­ mercial bank credit slowed substantially low for considerably less decline. in March from the accelerated pace ear­ lier in the year. Since mid-March, most market interest rates on balance have de­ On May 6 the Committee held a clined considerably. telephone conference to review the Taking account of past and prospec­ situation and to consider whether tive economic developments, the Feder­ supplementary instructions were al Open Market Committee seeks to fos­ needed. Available data suggested ter monetary and financial conditions that will resist inflationary pressures that the demand for money and while encouraging moderate economic hence the demand for reserves had Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 489 remained weak, and the federal Votes for this action: Messrs. Volck­ funds rate most recently had fallen er, Morris, Rice, Roos, Schultz, Mrs. Teeters, and Mr. Winn. Votes below the 13 percent lower limit of against this action: Messrs. Guffey, the intermeeting range of 13 to 19 Solomon, and Wallich. Absent: Mr. percent. The Committee voted to re­ Partee. duce the lower limit of the inter­ Messrs. Guffey and Solomon vot­ meeting range for the funds rate to ed against this action because they IOV2 percent. preferred smaller reductions in the On May 6 the Committee modified the lower limit of the federal funds domestic policy directive adopted at its rate and Mr. Wallich voted against it meeting on April 22, 1980, to reduce the lower limit of the range for the federal because he preferred to maintain the funds rate to IOV2 percent. lower limit at 13 percent. * * * 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 made available a few days after the next regularly scheduled meeting and are later published in the Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

490 Membership of the Board of Governors of the Federal Reserve System, 1913-80 Appointive Members1 Federal Reserve Date of initial Other dates and information relating Name District oath of office to membership2 Charles S. Hamlin .... . .Boston ............... Aug. 10, 1914 Reappointed in 1916 and 1926. Served until Feb. 3, 1936.3 Paul M. Warburg ......... . .New York .............do .......... Term expired Aug. 9, 1918. Frederic A. Delano .... . .Chicago ........... .............do .......... Resigned July 21, 1918. W. P. G. Harding ......... . .Atlanta ............................do .......... Term expired Aug. 9, 1922. Adolph C. Miller........... . .San Francisco ..............do .......... Reappointed in 1924. Reappointed in 1934 from the Richmond District. Served until Feb. 3, 1936.3 Albert Strauss ............... . .New York .. .Oct. 26, 1918 Resigned Mar. 15, 1920. Henry A. Moehlenpah .. .Chicago ........... Nov. 10, 1919 Term expired Aug. 9, 1920. Edmund Platt ................. . .New York ____.. June 8, 1920 Reappointed in 1928. Resigned Sept. 14, 1930. David C. Wills ............... . .Cleveland ____ Sept. 29, 1920 Term expired Mar. 4, 1921. John R. Mitchell ........... . .Minneapolis .. May 12, 1921 Resigned May 12, 1923. Milo D. Campbell ......... . .Chicago ........... Mar. 14, 1923 Died Mar. 22, 1923. Daniel R. Crissinger ... . .Cleveland ------. . .May 1, 1923 Resigned Sept. 15, 1927. George R. James ........... . .St. Louis ......... May 14, 1923 Reappointed in 1931. Served until Feb. 3, 1936.3 Edward H. Cunningham . .Chicago ........... .............do .......... Died Nov. 28, 1930. Roy A. Young ............... . .Minneapolis .. Oct. 4, 1927 Resigned Aug. 31, 1930. Eugene Meyer ............... . .New York .... . . Sept. 16, 1930 Resigned May 10, 1933. Way land W. Magee . .. . .Kansas City .. May 18, 1931 Term expired Jan. 24, 1933. Eugene R. Black ........... . .Atlanta ............. May 19, 1933 Resigned Aug. 15, 1934. M. S. Szymczak ........... . .Chicago ............. . June 14, 1933 Reappointed in 1936 and 1948. Resigned May 31, 1961. J. J. Thomas ................. . .Kansas City .. .............do .......... Served until Feb. 10, 1936.3 Marriner S. Eccles .... . .San Francisco ... .Nov. 15, 1934 Reappointed in 1936, 1940, and 1944. Resigned July 14, 1951. Joseph A. Broderick .. . .New York .... Feb. 3, 1936 Resigned Sept. 30, 1937. John K. McKee............. . .Cleveland ------.............do .......... Served until Apr. 4, 1946.3 Ronald Ransom ............. . .Atlanta ............. .............do .......... Reappointed in 1942. Died Dec. 2, 1947. Ralph W. Morrison .... . .Dallas ............... Feb. 10, 1936 Resigned July 9, 1936. Chester C. Davis........... . .Richmond .... June 25, 1936 Reappointed in 1940. Resigned Apr. 15, 1941. Ernest G. Draper ......... . .New York .... Mar. 30, 1938 Served until Sept. 1, 1950.3 Rudolph M. Evans .... . .Richmond .... .. .Mar. 14, 1942 Served until Aug. 13, 1954.3 James K. Vardaman, Jr. . .St. Louis ......... .. .Apr. 4, 1946 Resigned Nov. 30, 1958. Lawrence Clayton .... . .Boston ............... Feb. 14, 1947 Died Dec. 4, 1949. Thomas B. McCabe ... . .Philadelphia .. Apr. 15, 1948 Resigned Mar. 31, 1951. Edward L. Norton .... . .Atlanta ............. Sept. 1, 1950 Resigned Jan. 31, 1952. Oliver S. Powell ........... . .Minneapolis .. .............do .......... Resigned June 30, 1952. Wm. McC. Martin, Jr. . . .New York .... Apr. 2, 1951 Reappointed in 1956. Term expired Jan. 31, 1970. A. L. Mills, Jr.................. . .San Francisco ... .Feb. 18, 1952 Reappointed in 1958. Resigned Feb. 28, 1965. J. L. Robertson ............. . .Kansas City .. .............do .......... Reappointed in 1964. Resigned Apr. 30, 1973. C. Canby Balderston .. . .Philadelphia .. .. .Aug. 12, 1954 Served through Feb. 28, 1966. Paul E. Miller ............... . .Minneapolis .. Aug. 13, 1954 Died Oct. 21, 1954. For notes, see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

491 Federal Reserve Date of initial Other dates and information relating Name District oath of office to membership2 Chas. N. Shepardson ___Dallas ......................Mar. 17, 1955 Retired Apr. 30, 1967. G. H. King, Jr......................Atlanta ....................Mar. 25, 1959 Reappointed in 1960. Resigned Sept. 18, 1963. George W. Mitchell .........Chicago ..................Aug. 31, 1961 Reappointed in 1962. Served until Feb. 13,1976.3 J. Dewey Daane ...............Richmond .............Nov. 29, 1963 Served until Mar. 8, 1974.3 Sherman J. Maisel ...........San Francisco ... .Apr. 30, 1965 Served through May 31, 1972. Andrew F. Brimmer.........Philadelphia .........Mar. 9, 1966 Resigned Aug. 31, 1974. William W. Sherrill...........Dallas ......................May 1, 1967 Reappointed in 1968. Resigned Nov. 15, 1971. Arthur F. Burns ...............New York .............Jan. 31, 1970 Term began Feb. 1, 1970. Resigned Mar. 31, 1978. John E. Sheehan ...............St. Louis ................Jan. 4, 1972 Resigned June 1, 1975. Jeffrey M. Bucher.............San Francisco___June 5, 1972 Resigned Jan. 2, 1976. Robert C. Holland ...........Kansas City .........June 11, 1973 Resigned May 15, 1976. Henry C. Wallich .............Boston ....................Mar. 8, 1974 Philip E. Coldwell.............Dallas ......................Oct. 29, 1974 Served through Feb. 29, 1980. Philip C. Jackson, Jr..........Atlanta ....................July 14, 1975 Resigned Nov. 17, 1978. J. Charles Partee ...............Richmond .............Jan. 5, 1976 Stephen S. Gardner .........Philadelphia .........Feb. 13, 1976 Died Nov. 19, 1978. David M. Lilly...................Minneapolis .........June 1, 1976 Resigned Feb. 24, 1978. G. William Miller .............San Francisco-----Mar. 8, 1978 Resigned Aug. 6, 1979. Nancy H. Teeters .............Chicago ..................Sept. 18, 1978 Emmett J. Rice .................New York .............June 20, 1979 Frederick H. Schultz ___Atlanta ....................July 27, 1979 Paul A. Volcker ...............Philadelphia .........Aug. 6, 1979 Lyle E. Gramley ...............Kansas City .........May 28, 1980 Chairmen4 Vice Chairmen4 Charles S. Hamlin .........Aug. 10, 1914-Aug. 9, 1916 Frederic A. Delano ... .Aug. 10, 1914-Aug. 9, 1916 W. P. G. Harding...........Aug. 10, 1916-Aug. 9, 1922 Paul M. Warburg ...........Aug. 10, 1916-Aug. 9, 1918 Daniel R. Crissinger .. .May 1, 1923-Sept. 15, 1927 Albert Strauss .................Oct. 26, 1918-Mar. 15, 1920 Roy A. Young.................Oct. 4, 1927-Aug. 31, 1930 Edmund Platt .................July 23, 1920-Sept. 14, 1930 Eugene Meyer.................Sept. 16, 1930-May 10, 1933 J. J. Thomas ...................Aug. 21, 1934-Feb. 10, 1936 Eugene R. Black ...........May 19, 1933-Aug. 15, 1934 Ronald Ransom .............Aug. 6, 1936-Dec. 2, 1947 Marriner S. Eccles .........Nov. 15, 1934-Jan. 31, 1948 C. Canby Balderston . . .Mar. 11, 1955-Feb. 28, 1966 Thomas B. McCabe-----Apr. 15, 1948-Mar. 31, 1951 J. L. Robertson .............Mar. 1, 1966-Apr. 30, 1973 Wm. McC.Martin, Jr. . .Apr. 2, 1951-Jan. 31, 1970 George W. Mitchell ... .May 1, 1973-Feb. 13, 1976 Arthur F. Burns .............Feb. 1, 1970-Jan. 31, 1978 Stephen S. Gardner -----Feb. 13, 1976-Nov. 19, 1978 G. William Miller ...........Mar. 8, 1978-Aug. 6, 1979 Frederick H. Schultz . . .July 27, 1979- Paul A. Volcker .............Aug. 6, 1979- Ex-Officio Members1 Secretaries of the Treasury Comptrollers of the Currency W. G. McAdoo ...............Dec. 23, 1913-Dec. 15, 1918 John Skelton Williams . .Feb. 2, 1914-Mar. 2, 1921 Carter Glass ....................Dec. 16, 1918-Feb. 1, 1920 Daniel R. Crissinger . . .Mar. 17, 1921-Apr. 30, 1923 David F. Houston .........Feb. 2, 1920-Mar. 3, 1921 Henry M. Dawes ...........May 1, 1923-Dec. 17, 1924 Andrew W. Mellon ... .Mar. 4, 1921-Feb. 12, 1932 Joseph W. McIntosh .. .Dec. 20, 1924-Nov. 20, 1928 Ogden L. Mills ...............Feb. 12, 1932-Mar. 4, 1933 J. W. Pole ........................Nov. 21, 1928-Sept. 20, 1932 William H. Woodin ... .Mar. 4, 1933-Dec. 31, 1933 J. F. T. O’Connor .........May 11, 1933-Feb. 1, 1936 Henry Morgenthau, Jr. . .Jan. 1, 1934-Feb. 1, 1936 1. Under the provisions of the original Federal Reserve Act the Treasury and the Comptroller of the Currency should continue to Federal Reserve Board was composed of seven members, including serve as members until Feb. 1, 1936; that the appointive members five appointive members, the Secretary of the Treasury, who was in the office on the date of that act should continue to serve until Feb. ex-officio chairman of the Board, and the Comptroller of the Cur­ 1, 1936, or until their successors were appointed and had qualified; rency. The original term of office was ten years, and the five orig­ and that thereafter the terms of members should be 14 years and inal appointive members had terms of two, four, six, eight, and ten that the designation of Chairman and Vice Chairman of the Board years respectively. In 1922 the number of appointive members was should be for a term of four years. increased to six, and in 1933 the term of office was increased to 12 2. Date after words “Resigned” and “Retired” denotes final day years. The Banking Act of 1935, approved Aug. 23, 1935, changed of service. the name of the Federal Reserve Board to the Board of Governors 3. Successor took office on this date. of the Federal Reserve System and provided that the Board should 4. Chairman and Vice Chairman were designated Governor and be composed of seven appointive members; that the Secretary of the Vice Governor before Aug. 23, 1935. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

492 Legal Developments Amendments to Regulation D member bank or a family of United States branches and agencies of a foreign bank (“family”) shall be The Board of Governors has amended its Regulation determined as follows: D, Reserves of Member Banks, to decrease the mar­ (i) For a member bank or family that, on a daily ginal reserve requirement ratio to 5 per cent and, gen­ average basis, is a net borrower of total managed erally, to increase the managed liabilities base of an liabilities during the fourteen-day base period end­ institution by ll 12 per cent. ing September 26, 1979, its managed liabilities This action is effective for marginal reserves re­ base shall be the lesser of the reported managed quired to be maintained during the seven-day period liabilities base for the reserve computation period beginning June 12, 1980, against total marginal man­ ending May 21, 1980, (Form FR 2414d, line 8) aged liabilities outstanding during the seven-day peri­ multiplied times 1.075, or the daily average of its od beginning May 29, 1980. total managed liabilities during the fourteen-day Effective June 12, 1980, section 204.5 of Regulation period ending September 26, 1979. For each com­ D (12 CFR 204.5) is revised as follows: putation period beginning after May 28, 1980, the managed liabilities base of a member bank or fam­ ily shall be reduced during the computation period Section 204.5 Reserve Requirements by the amount by which its lowest daily average of (A) gross loans to non-United States residents18 (f) Marginal Reserve Requirements. and (B) gross balances due from foreign offices of (1) Member banks. A member bank shall maintain a other institutions19 or institutions, the time de­ daily average reserve balance against its time depos­ posits of which are exempt from the rate limita­ its equal to 5 per cent of the amount by which the tions of Regulation Q pursuant to § 217.3(g) daily average of its total managed liabilities during thereof,20 the seven-day computation period ending eight days outstanding during any computation period be­ prior to the beginning of the corresponding seven- ginning after May 28, 1980, is lower than the low­ day reserve maintenance period exceeds the mem­ est daily average of such loans and balances out­ ber bank’s managed liabilities base as determined in standing during any computations period accordance with subparagraph (3). * * * between March 6, 1980, and May 28, 1980, for which data were reported on form FR 2414d. The (2) United States branches and agencies of foreign amount representing such difference shall be banks. A United States branch or agency of a for­ eign bank with total worldwide consolidated bank 18. A United States resident is: (a) Any individual residing (at the assets in excess of $1 billion shall maintain a daily time the credit is extended) in any State of the United States or the District of Columbia; (b) any corporation, partnership, association or average reserve balance against its liabilities equal other entity organized therein (“domestic corporation”); and (c) any to 5 per cent of the amount by which the daily aver­ branch or office located therein of any other entity wherever orga­ age of its total managed liabilities during the seven- nized. Credit extended to a foreign branch, office, subsidiary, affiliate or other foreign establishment (“foreign affiliate”) controlled by one day computation period ending eight days prior to or more such domestic corporations will not be deemed to be credit the beginning of the corresponding seven-day re­ extended to a United States resident if the proceeds will be used in its foreign business or that of other foreign affiliates of the controlling serve maintenance period exceeds the institution’s domestic corporation(s). managed liabilities base as determined in accord­ 19. Any banking office located outside the States of the United ance with subparagraph (3). * * * States and the District of Columbia of a bank organized under domes­ tic or foreign law. 20. A foreign central bank, or any international organization of (3) Managed liabilities base. During the seven-day which the United States is a member, such as the International Bank reserve computation period beginning May 29, 1980, for Reconstruction and Development (World Bank), International Monetary Fund, Inter-American Development Bank, and other for­ and during each seven-day reserve computation pe­ eign international, or supranational entities exempt from interest rate riod thereafter, the managed liabilities base of a limitations under § 217.3(g)(3) of Regulation Q (12 CFR 217.3(g)(3)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 493 rounded to the next lowest multiple of $2 million. Effective May 21, 1980, Regulation Z is amended as In no event will the managed liabilities base for follows: an institution that was a net borrower of managed 1. Section 226.3(e) is amended by deleting the period liabilities during the fourteen-day base period at the end of the paragraph and inserting the following ending September 26, 1979, be less than $100 mil­ phrase: lion. (ii) For a member bank or family that, on a daily and, at the creditor’s option, any credit transaction pri­ average basis, is a net lender of total managed marily for agricultural purposes in which the amount financed does not exceed $25,000.” liabilities during the fourteen-day base period ending September 26, 1979, its managed liabili­ 2. Section 226.8 is amended by deleting the catchline and text ties base shall be the sum of its daily average neg­ of paragraph (n), and inserting the following in its place: ative total managed liabilities and $100 million. “[Reserved.]” Amendments to Regulation E Amendments to Credit Restraint The Board of Governors has amended § 205.9(a)(3) of Regulation E, which implements the Electronic Fund Subpart A—Consumer Credit Transfer Act, to exempt point-of-sale (POS) transfers from the requirement to identify, on the terminal On March 14, 1980, the Board of Governors adopted a receipt, the type of account accessed. The exemption consumer credit restraint program (12 C.F.R. Part 229, is limited to POS transfers in which the access device Subpart A; 45 Federal Register 17927, March 19, 1980) involved can access only one particular account at that requires certain creditors that extend certain types point-of-sale. of consumer credit to maintain a special deposit with the Effective May 10, 1980, Regulation E is amended by Federal Reserve equal to 15% of the amount by which adding a second sentence to footnote 3 to § 205.9(a)(3), the creditor’s outstanding covered credit during a to read as set forth below: month exceeds the creditor’s base. The Board has amended its consumer credit restraint regulation to re­ duce the special deposit requirement to an amount Section 205.9—Documentation of Transfers equal to 772% of the amount by which a creditor’s out­ standing covered credit during a month exceeds its (a) Receipts at electronic terminals. * * * base. Effective July 24, 1980, the Board amends Subpart A by substituting the number “772” for the number (3) The type of transfer and the type of the con­ “15,” so that the first sentence of § 229.4(a) reads as sumer’s account(s)3 * * * set forth below: Amendments to Regulation Z Section 229.4—Maintenance of Special Deposit The Board of Governors has amended Regulation Z to (a) Each covered creditor shall hold a non-interest implement two provisions of the recently enacted bearing special deposit equal to 772 per cent of the Truth in Lending Simplification and Reform Act. The amount by which the average amount of its covered first provision being implemented is the exemption of credit outstanding during the month exceeds its base. all extensions of credit for agricultural purposes from disclosure requirements. The second is the elimination of disclosures currently required for periodic state­ ments provided in connection with closed-end credit Subpart B—Short Term Financial transactions. Intermediaries On March 14, 1980, the Board adopted Subpart B to 3. If more than one account of the same type may be accessed by a restrain the expansion of short term credit through single access device, the accounts must be uniquely identified. In a point-of-sale transfer, the type of account need not be identified if the money market funds and other similar creditors. This access device used may access only one account at point of sale. Subpart subsequently was amended on March 28, 1980. Based upon an evaluation of recent credit data, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

494 Federal Reserve Bulletin □ June 1980 the Board has determined to decrease the special de­ (1) For a covered bank that, on a daily average posit ratio from 15 per cent to lxh per cent for credi­ basis, was a net borrower of total managed liabilities tors subject to this Subpart. during the fourteen-day base period ending March This action is effective for special deposits required 12, 1980, its base for the computation period begin­ to be maintained during the seven-day maintenance ning May 29, 1980, shall be equal to its base reported period beginning June 30, 1980, for the computation for the computation period beginning May 15, 1980 period beginning June 16, 1980. (as reported on line 8 of form F.R. 2412d) multiplied Effective June 30, 1980, the Board amends Subpart by 1.075. However, a covered bank whose base has B as follows: never exceeded $100 million shall not multiply its base by 1.075. The managed liabilities base of a cov­ 1. In section 229.14(a)(1), by striking “15” and in­ ered bank shall be reduced by the amount by which serting in its place “7V2”. its lowest daily average of (A) gross loans to non-United States residents3 2. In section 229.14(b), by striking “15” and inserting and in its place “7V2”. (B) gross balances due from foreign offices of oth­ er institutions4 or institutions the time deposits of Subpart C—Nonmember Commercial Banks which are exempt from the rate limitations of Reg­ ulation Q pursuant to § 217.3(g) thereof,5 On March 14, 1980, the Board of Governors adopted outstanding during any computation period begin­ Subpart C to require commercial banks that are not ning after May 28, 1980, is lower than the lowest members of the Federal Reserve System to maintain a daily average amount of such loans and balances non-interest bearing special deposit with the Federal outstanding during the base period or any computa­ Reserve equal to 10 per cent of the amount by which tion period between March 20, 1980 and May 28, the total of managed liabilities of those banks exceeds 1980. The amount of the reduction shall be rounded the amount of such managed liabilities outstanding down to the largest lower multiple of $2 million. during a base period. The Board has determined to de­ However, in no event will the managed liabilities crease the special deposit ratio from 10 per cent to 5 base for a covered bank that was a net borrower of per cent and increase, generally, an institution’s man­ managed liabilities during the fourteen-day base pe­ aged liabilities base. riod ending March 12, 1980, be less than $100 mil­ This amendment will be effective for the special de­ lion. posit required to be maintained by nonmember com­ (2) For a covered bank that, on a daily average mercial banks for the seven-day period beginning June basis, is a net lender of total managed liabilities dur­ 12, 1980, for the computation period beginning May ing the fourteen-day base period ending March 12, 29, 1980. 1980, its managed liabilities base shall be the sum of Effective June 12, 1980, the Board amends Subpart its daily average negative total managed liabilities C as follows: and $100 million. Section 229.24—Maintenance of Special Deposit (a) During the seven-day maintenance period begin­ 3. A United States resident is: (a) any individual residing (at the ning June 12, 1980, and each deposit maintenance peri­ time the credit is extended) in any State of the United States or the od thereafter, each covered bank shall maintain a non­ District of Columbia; (b) any corporation, partnership, association or other entity organized therein (“domestic corporation”); and (c) any interest bearing special deposit equal to 5 per cent of branch or office located therein of any other entity wherever orga­ the amount by which the daily average of its total man­ nized. Credit extended to a foreign branch, office, subsidiary, affiliate aged liabilities during the seven-day computation peri­ or other foreign establishment (“foreign affiliate”) controlled by one or more such domestic corporations will not be deemed to be credit od ending eight days prior to the beginning of the cor­ extended to a United States resident if the proceeds will be used in its responding seven-day maintenance period exceeds its foreign business or that of other foreign affiliates of the controlling domestic corporation(s). managed liabilities base as determined in accordance 4. Any banking office located outside the States of the United with paragraph (b). * * * States and the District of Columbia of a bank organized under domes­ tic or foreign law. 5. A foreign central bank, or any international organization, of (b) Managed liabilities base. During the seven-day de­ which the United States is a member, such as the International Bank posit computation period beginning May 29, 1980, and for Reconstruction and Development (World Bank), International Monetary Fund, Inter-American Development Bank, and other for­ during each seven-day deposit computation period eign international, or supranational entities exempt from interest thereafter, the managed liabilities base of a covered rate limitations under § 217.3(g)(3) of Regulation Q (12 C.F.R. § bank shall be determined as follows: 217.3(g)(3)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 495 Subpart D—Reports Under Special Credit scribed by the Board in accordance with the instruc­ Restraint Program tions thereto. The Board of Governors has amended Subpart D to enable it to reduce the reporting burden on U.S. com­ Amendments to R ules Regarding mercial banks, and U.S. branches and agencies of for­ Delegation of A uthority eign banks, finance companies, U.S. bank holding companies, and to discontinue the reporting require­ The Board of Governors has approved a technical ments for large corporate borrowers. amendment advancing the “sunset” provision con­ Effective May 27, 1980, Subpart D is amended as tained in the final sentence of 12 C.F.R. § 265.1a(c) to follows: June 30, 1982, for the delegation of authority contained in § 265.1a(c). This action will continue the delegation Subpart D —Reports under Special Credit of authority by the Board of Governors to any three Restraint Program Board members designated by the Chairman to act on certain matters in the absence of a quorum of the Board where delay would be inconsistent with the Section 229.33—Reports by Large Lenders public interest. 3. Effective May 19, 1980, section 265.1a(c) is (a) Large Commercial banks. Each U.S. commercial amended to read as follows: bank having U.S consolidated assets of $1 billion or more shall file such reports on its activities as may be required by the Board from time to time on forms pre­ Section 265. la—Specific Functions Delegated to scribed by the Board in accordance with the instruc­ Board Members tions thereto. (b) U.S. agencies and branches of foreign banks. Each (c )Any three Board members designated from time to family of U.S. offices of a foreign bank having world­ time by the Chairman (the “Action Committee”) are wide banking assets of more than $1 billion monthly authorized, * * * This delegation of authority shall ter­ shall file such reports on its activities as may be re­ minate June 30, 1982. quired by the Board from time to time on forms pre­ scribed by the Board in accordance with the instruc­ Depository Institutions Deregulation Committee tions thereto. Title II of the Depository Institutions Deregulation and (c) U.S. bank holding companies. Each U.S. bank Monetary Control Act of 1980 (Public Law 96-221) holding company with U.S. consolidated financial as­ transferred to the Depository Institutions Deregulation sets of $1 billion or more shall file such reports on its Committee the authorities conferred on the Board of activities as may be required by the Board from time to Governors of the Federal Reserve System, the Federal time on forms prescribed by the Board in accordance Deposit Insurance Corporation, and the Federal Home with the instructions thereto. Loan Bank Board by section 19(j) of the Federal Re­ serve Act (12 U.S.C. § 371b), section 18(g) of the Fed­ (d) U.S. finance companies. Each U.S. finance com­ eral Deposit Insurance Act (12 U.S.C. § 1828(g)), and pany with total business receivables outstanding (that section 5B(a) of the Federal Home Loan Bank Act (12 is, all loans excluding those made for personal, family U.S.C. § 1425b(a)) to prescribe rules governing the or household uses) of $1 billion or more shall file such payment of interest and dividends and the estab­ reports on its activities as may be required by the lishment of classes of deposits or accounts, including Board from time to time on forms prescribed by the limitations on the maximum rates of interest and divi­ Board in accordance with the instructions thereto. dends which may be paid on deposits and accounts. Effective May 6, 1980, the Committee established Section 229.34 —Reports by Intermediate-sized Title 12 Code of Federal Regulations Chapter 12 and Commercial Banks adopted Parts 1201 through 1204 as follow: Each U.S. commercial bank with U.S. consolidated The Rules of Organization and Procedure specify assets of $300 million or more but less than $1 billion the composition and functions of the Committee (sec­ shall file such reports on its activities as may be re­ tion 1201.2), the procedures for Committee meetings quired by the Board from time to time on forms pre­ (section 1201.4), the procedures for issuing regulations Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

496 Federal Reserve Bulletin □ June 1980 and public participation in the rulemaking process, and Section 1201.3—Offices the means by which interested persons may petition the Committee for rulemaking (section 1201.6). The principal offices of the Committee are in the Fed­ eral Reserve Building, 20th Street and Constitution Avenue, N.W., Washington, D.C. 20551. The Com­ Part 1201-Rules of Organization and Proce­ mittee’s regular business hours are from 8:45 a.m. to dure 5:15 p.m. Monday through Friday; but such business hours may be changed from time to time. Section 1201.1 Basis and Scope 1201.2 Composition and Functions Section 1201.4—Meetings and Actions of the of the Committee Committee 1201.3 Offices 1201.4 Meetings and Actions of the Com­ (a) Place and Frequency—The Committee meets, mittee whenever called by the Chairman or by three or more 1201.5 Staff members of the Committee, at such times and at such 1201.6 Procedure for Regulations places as the Chairman or members deem necessary in 1201.7 Amendments order to consider matters requiring action by the Com­ mittee. The Committee shall hold at least one public meeting in each calendar quarter. Section 1201.1—Basis and Scope (b) Quorum and Voting—Three voting members of the Committee constitute a quorum for the transaction This Part is issued by the Depository Institutions of business. All decisions and determinations by the Deregulation Committee (“Committee”) pursuant to Committee shall be made by a majority vote of the vot­ the requirements of section 552 of Title 5 of the United ing members. Votes on all decisions and determina­ States Code that each agency shall publish in the Fed­ tions of the Committee shall be recorded in the min­ eral Register a description of its organizational struc­ utes. Upon the request of any Committee member a ture and the means and rules by which it takes action. vote shall be recorded according to individual Com­ mittee members. Section 1201.2—Composition and Functions of (c) Agenda of Meetings—To the extent practicable, an the Committee agenda for each meeting shall be distributed to mem­ bers of the Committee at least seven days in advance (a) Composition of Committee—The Committee con­ of the date of the meeting, together with copies of ma­ sists of the Secretary of the Treasury, the Chairman of terial relevant to the agenda items. the Board of Governors of the Federal Reserve Sys­ (d) Minutes—The Executive Secretary shall keep tem, the Chairman of the Board of Directors of the minutes of each Committee meeting, a draft of which Federal Deposit Insurance Corporation, the Chairman is to be distributed to each member of the Committee of the Federal Home Loan Bank Board, and the Chair­ as soon as practicable after each meeting. To the ex­ man of the National Credit Union Administration tent practicable, the minutes of a Committee meeting Board, who are voting members, and the Comptroller shall be corrected and approved at the next meeting of of the Currency, who is a nonvoting member. A voting the Committee. member of the Committee shall be elected Chairman (e) Use of Conference Call Communications Equip­ to serve for a term of one year. The Chairman of the ment—Any member may participate in a meeting of Committee shall preside at Committee meetings. A the Committee through the use of conference call tele­ voting member of the Committee shall be elected Vice phone or similar communications equipment by means Chairman to serve for a term of one year. The Vice of which all persons participating in the meeting can Chairman of the Committee shall preside at Com­ simultaneously speak to and hear each other. Actions mittee meetings in the absence of the Chairman. taken by the Committee at meetings conducted (b) Functions of the Committee—Pursuant to the pro­ through the use of such equipment, including the votes visions, of Title II of the Depository Institutions Dereg­ of each member, shall be recorded in the usual manner ulation and Monetary Control Act of 1980 (P.L. 96- in the minutes of the meetings. 221), the Committee is authorized to prescribe rules (f) Transaction of Business by Circulation of Written governing the payment of interest and dividends on de­ Items—When in the judgment of the Chairman circum­ posits and accounts of federally insured commercial stances occur making it necessary for the Committee banks, savings and loan associations and mutual sav­ to consider action when it is not feasible to call a meet­ ings banks. ing, the relevant information and recommendaitons for Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 497 action may be transmitted to the members by the Ex­ (e) of this section or otherwise excepted by law. Such ecutive Secretary of the Committee and the voting notices include a statement of the terms of the pro­ members may communicate their votes to the Execu­ posed regulations or amendments and a description of tive Secretary of the Committee in writing. Any action the subjects and issues involved; but the giving of such taken under this paragraph has the same effect as an notices does not necessarily indicate the Committee’s action taken at a meeting. Any such action shall be final approval of any feature of any such proposal. The recorded in the minutes. Any voting member of the notices also include a reference to the authority for the Committee may require that a matter be placed on the proposed regulations or amendments and a statement agenda of a Committee meeting. of the time, place, and nature of public participation. (b) Public Participation—The usual method of public participation in the rulemaking process is through the Section 1201.5—Staff written submission of data, views, or arguments. They should be sent to the Executive Secretary of the Com­ (a) Policy Director—The Policy Director of the Com­ mittee, Federal Reserve Building, 20th Street and mittee is appointed by the Chairman of the Committee Constitution Avenue, N.W., Washington, D.C. 20551. and provides general staff direction and coordination Such material will be made available for inspection of policy and other substantive matters coming before and copying upon request, except as provided in Part the Committee, and performs such other duties as the 1202 of this chapter regarding availability of informa­ Committee may require. tion. (b) Executive Secretary—The Executive Secretary of (c) Any interested person may petition the Committee the Committee prepares agenda for Committee meet­ for the issuance, amendment, or repeal of any rule by ings, sends notice of all meetings, prepares minutes of submitting such petition in writing together with a all meetings, maintains a complete record of all votes complete and concise statement of the petitioner’s in­ and actions taken by the Committee, has custody of all terest in the subject matter and the reasons why the records of the Committee, clears and conducts official petition should be granted. Such petition should be correspondence of the Committee and performs such submitted to the Executive Secretary of the Com­ other duties as the Committee may require. mittee. (c) General Counsel—The General Counsel of the (d) Effective Dates—Any substantive regulation or Committee provides legal advice relating to the re­ amendment thereto issued by the Committee is pub­ sponsibilities of the Committee and on such other mat­ lished not less than 30 days prior to the effective date ters as the Committee may require and issues certifica­ thereof, except as specified in paragraph (e) of this sec­ tions required by the Government in the Sunshine Act tion or as otherwise excepted by law. (5 U.S.C. 552b). On legal matters other than the fore­ (e) Exceptions as to Notice or Effective Date—When­ going, legal staff effort will be coordinated through the ever the Committee finds that notice of, and public Policy Director in consultation with the Chairman of participation in, rulemaking is impracticable, unneces­ the Committee. sary, or contrary to the public interest, or there is good (d) Others—The Committee may appoint such other cause why the effective date of any rule should not be officers and employees as the committee may deem deferred for 30 days, the provisions of §§ 1201.6(a), necessary to the discharge of its responsibilities. At 1201.6(b) and 1201.6(d) shall not apply; and any such the request of the Committee, members of the staffs of rule when published shall incorporate the finding and a the Department of the Treasury, the Board of Gover­ brief statement of the reasons therefore. nors of the Federal Reserve System, the Board of Di­ rectors of the Federal Deposit Insurance Corporation, the Federal Home Loan Bank Board, the National Credit Union Administration Board and the Comptrol­ Section 1201.7—Amendments ler of the Currency shall perform such services as may be appropriate in assisting the Committee in the dis­ Except as otherwise provided by law, any of these charge of its responsibilities. rules may be altered, amended, or repealed, or new rules may be adopted at any meeting of the Committee by a majority vote of the voting members of the Com­ mittee. Section 1201.6—Procedure for Regulations The Committee has adopted regulations setting forth (a) Notice—Notices of proposed regulations of the the basic policies of the Committee regarding informa­ Committee or amendments thereto are published in tion it maintains and the procedures for obtaining ac­ the Federal Register, except as specified in paragraph cess to such information. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

498 Federal Reserve Bulletin □ June 1980 Part 1202-Rules Regarding Availability of sions of section 552 of Title 5 of the United States Information Code and this Part. (b) Obtaining Access to Records—Records of the Section 1202.1 Basis and Scope Committee subject to this section are available for 1202.2 Definitions public inspection or copying during regular business 1202.3 Published Information hours on regular business days at the office of the Ex­ 1202.4 Records Available to the Public Up­ ecutive Secretary of the Committee, Federal Reserve on Request Building, 20th Street and Constitution Avenue, N.W., 1203.5 Exemptions Washington, D.C. 20551. Every request for access to such records shall be submitted in writing to the Exec­ utive Secretary of the Committee, Federal Reserve Section 1202.1—Basis and Scope Building, 20th Street and Constitution Avenue, N.W., Washington, D.C. 20551. Such request shall state the This Part is issued by the Depository Institutions name and address of the person requesting such ac­ Deregulation Committee (“Committee”) pursuant to cess, shall clearly indicate whether such request is an the requirement of section 552 of Title 5 of the United initial request or an appeal from a denial of information States Code and sets forth the basic policies of the requested pursuant to the Freedom of Information Committee regarding information it maintains and the Act, and shall describe such records in a manner rea­ procedures for obtaining access to such information. sonably sufficient to permit identification without diffi­ culty. Section 1202.2—Definitions (c) Actions on Requests—The Executive Secretary of the Committee shall, within 10 working days after For the purposes of this Part, the term “records of the receipt of a request for records, either comply with or Committee” means rules, statements, orders, memo­ deny such request unless such time period is extended randa, letters, reports, accounts, information obtain­ pursuant to paragraph (e) of this section, in which able only by processing through a computer or other event the Executive Secretary shall acknowledge information systems program, and other papers con­ receipt of the request within the 10-day period and in­ taining information of the Committee that constitute dicate the reason for such delay and the date on which part of the Committee’s official files. it is expected that a determination as to disclosure will be dispatched. A response denying a request for a rec­ Section 1202.3—Published Information ord shall be in writing signed by the Executive Secre­ tary and shall specify the reason for such denial and Pursuant to sections 552 and 553 of Title 5 of the include a statement informing the requester that the United States Code, the Committee publishes the fol­ denial may be appealed as provided in paragraph (d) of lowing information in the Federal Register for the this section. guidance of the public: (1) descriptions of its central (d) Appeal of Denial of Access to Records—Any per­ organization and the established place at which, the son denied access to records of the Committee, prop­ officers from whom, and the methods whereby, the erly requested in accordance with paragraph (b) of this public may secure information, make submittals or section, may within 20 days after notification of such requests, or obtain decisions; (2) rules of organization denial file a written request with the Executive Secre­ and procedure; (3) substantive rules of general appli­ tary of the Committee for review of such denial. The cability adopted as authorized by law, and statements Committee shall make a determination with respect to of general policy or interpretations of general appli­ any such appeal within 20 working days of its receipt. cability formulated and adopted by the Committee; (4) The Executive Secretary of the Committee shall im­ every amendment, revision or repeal of the foregoing; mediately notify the appealing party of the Com­ and (5) notices of proposed rulemaking. mittee’s decision on the appeal and of the right to seek court review of any decision which upholds, in whole or in part, the refusal of the Executive Secretary of the Section 1202.4—Records Available to the Public Committee to make available the requested records. Upon Request The granting or denial of a request upon appeal shall constitute final agency action. (a) General Rule—Subject to the limitations of section (e) Extension of Time to Act Upon Requests—In un­ 1202.5(a) of this Part, all records of the Committee, usual circumstances as provided in 5 U.S.C. § whether or not published under section 1202.3, are 552(a)(6)(B), the time limitations imposed upon the made available to any person, upon request, for in­ Executive Secretary of the Committee or the Com­ spection and copying in accordance with the provi­ mittee in paragraphs (c) and (d) of this section may be Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 499 extended by written notice to the requesting party for (7) investigatory records compiled for law enforce­ a period of time not to exceed a total of ten working ment purposes (but only to the extent provided in the days. Freedom of Information Act (5 U.S.C. § 552(b)(7)); or (f) Fee Schedule—A person requesting access to or (8) contained in or related to examination, oper­ copies of particular records shall pay the costs of ating, or condition reports prepared by, on behalf of, searching for and copying such records at the rate of or for the use of an agency responsible for the regula­ $10 per hour for searching and 10 cents per standard tion or supervision of financial institutions. page for copying. With respect to records obtainable In accordance with the Government in the Sunshine only by processing through a computer or other infor­ Act (the “Act”), 5 U.S.C. § 552b, the Committee has mation systems program, a person requesting such adopted regulations as required by subsection (g) of records shall pay a fee not to exceed the direct and the Act. The purpose of these regulations is to provide reasonable cost of retrieval and production of the rec­ for the procedures under which the open meeting re­ ords requested. Detailed schedules of such charges are quirements of subsections (b) through (f) of the Act available upon request from the Executive Secretary will be met. of the Committee. Documents may be furnished with­ out charge or at a reduced charge where the Executive Secretary of the Committee determines that waiver or reduction of the fee is in the public interest because Part 1203 —Rules Regarding Public Observation furnishing the records can be considered as primarily of Meetings benefitting the general public or where total charges are less than $2. Section 1203.1 Basis and Scope 1203.2 Definitions Section 1202.5—Exemptions From Disclosure 1203.3 Conduct of Agency Business 1203.4 Meetings Open to Public Observa­ (a) General Rule—Except where the public interest tion indicates otherwise, information in the records of the 1203.5 Exemptions Committee that is not available to the public through 1203.6 Public Announcements of Meetings other sources and is exempted from required dis­ 1203.7 Meetings Closed to Public Observa­ closure by the provisions of section 552(b) of Title 5 of tion Under Expedited Procedures the United States Code is not available for inspection 1203.8 Meetings Closed to Public Observa­ and copying. Information exempted from required dis­ tion Under Regular Procedures closure includes information: 1203.9 Changes With Respect to Publicly (1)(A) specifically authorized under criteria estab­ Announced Meeting lished by an Executive Order to be kept secret in the 1203.10 Certification of the General Coun­ interest of national defense or foreign policy and (B) sel are in fact properly classified pursuant to such Execu­ 1203.11 Transcripts, Recordings, and Min­ tive Order; utes (2) related solely to the internal personnel rules and 1203.12 Procedures for Inspection and Ob­ practices of an agency; taining Copies of Transcripts and (3) specifically exempted from disclosure by statute Minutes (other than section 552b of Title 5 of the United States 1203.13 Fees Code), provided that such statute (A) requires that the matters be withheld from the public in such a manner as to leave no discretion on the issue, or (B) estab­ lishes particular criteria for withholding or refers to Section 1203.1—Basis and Scope particular types of matters to be withheld; (4) trade secrets and commercial or financial infor­ This Part is issued by the Depository Institutions De­ mation obtained from a person and privileged or con­ regulation Committee (“Committee”) under section fidential; 552b of Title 5 of the United States Code, the Govern­ (5) inter-agency or intra-agency memoranda or let­ ment in the Sunshine Act (the “Act”), to carry out ters which would not be available by law to a party the policy of the Act that the public is entitled to the other than an agency in litigation with the agency; fullest practicable information regarding the decision (6) personnel and medical files and similar files the making processes of the Committee while at the same disclosure of which would constitute a clearly unwar­ time preserving the rights of individuals and the ability ranted invasion of personal privacy; of the Committee to carry out its responsibilities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

500 Federal Reserve Bulletin □ June 1980 Section 1203.2—Definitions ing the meeting, in accordance with the provisions of Part 1202 of this chapter. For the purposes of this Part, the following definitions (c) The agency will maintain a complete electronic re­ shall apply: cording adequate to record fully the proceedings of each meeting or portion of a meeting open to public (a) The term “agency” means the Depository Institu­ observation. Cassettes will be available for listening in tions Deregulation Committee. the office of the Executive Secretary of the Com­ (b) The term “meeting” means the deliberations (in­ mittee, and copies may be ordered for $5 per cassette cluding those conducted by conference telephone call) by telephoning or by writing the office of the Executive of at least the number of individual agency members Secretary of the Committee, Federal Reserve Build­ required to take action on behalf of the agency where ing, 20th Street and Constitution Avenue, N.W., such deliberations determine or result in joint conduct Washington, D.C. 20551. or disposition of official agency business, but does not (d) The agency will maintain mailing lists of names and include (1) deliberations to determine whether a meet­ addresses of all persons who wish to receive copies of ing or a portion of a meeting will be open or closed to agency announcements of meetings open to public ob­ public observation and whether information regarding servation. Requests for announcements may be made closed meetings will be withheld from public dis­ by telephoning or by writing the office of the Executive closure; (2) deliberations to determine whether or Secretary of the Committee, Federal Reserve Build­ when to schedule a meeting; or (3) the conduct or dis­ ing, 20th Street and Constitution Avenue, N.W., position of official agency business by circulating writ­ Washington D.C. 20551. ten material to individual members. (c) The term “number of individual agency members required to take action on behalf of the agency” means Section 1203.5—Exemptions in the case of the Committee, a majority of its voting members. (d) The term “voting member” means the Secretary of (a) Except in a case where the agency finds that the the Treasury, the Chairman of the Board of Governors public interest requires otherwise, the agency may of the Federal Reserve System, the Chairman of the close a meeting or a portion or portions of a meeting Board of Directors of the Federal Deposit Insurance under the procedures specified in sections 1203.7 or Corporation, the Chairman of the Federal Home Loan 1203.8 of this Part, and withhold information under the Bank Board, and the Chairman of the National Credit provisions of sections 1203.6, 1203.7, 1203.8 or Union Administration Board. 1203.11 of this Part, where the agency properly deter­ (e) The term “public observation” means that the pub­ mines that such meeting or portion or portions of its lic shall have the right to listen and observe but not to meeting or the disclosure of such information is likely record any of the meetings by means of cameras or to: electronic or other recording devices unless approval (1) disclose matters that are (A) specifically autho­ in advance is obtained from the Executive Secretary of rized under criteria established by an Executive Order the Committee. to be kept secret in the interests of national defense or foreign policy, and (B) in fact properly classified pur­ suant to such Executive Order; Section 1203.3—Conduct of Agency Business (2) relate solely to internal personnel rules and practices; Members shall not jointly conduct or dispose of offi­ (3) disclose matters specifically exempted from dis­ cial agency business other than in accordance with this closure by statute (other than section 552 of Title 5 of Part. the United States Code), provided that such statute (A) requires that the matters be withheld from the pub­ Section 1203.4—Meetings Open To Public lic in such a manner as to leave no discretion on the Observation issue, or (B) establishes particular criteria for with­ holding or refers to particular types of matters to be (a) Except as provided in section 1203.5 of this Part, withheld; every portion of every meeting of the agency shall be (4) disclose trade secrets and commercial or finan­ open to public observation. cial information obtained from a person and privileged (b) Copies of staff documents considered in connection or confidential; with agency discussion of agenda items for a meeting (5) involve accusing any person of a crime, or for­ that is open to public observation shall be made avail­ mally censuring any person; able for distribution to members of the public attend­ (6) disclose information of a personal nature where Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 501 disclosure would constitute a clearly unwarranted in­ announcement of the information specified in subvasion of personal privacy; paragraph (a) at the earliest practicable time. (7) disclose investigatory records compiled for law (c) Changes in the subject matter of a publicly an­ enforcement purposes, or information which if written nounced meeting, or in the determination to open or would be contained in such records (but only to the close a publicly announced meeting or any portion of a extent provided in the Government in the Sunshine publicly announced meeting to public observation, or Act (5 U.S.C. § 552b(c)(7)); in the time or place of a publicly announced meeting (8) disclose information contained in or related to made in accordance with the procedures specified in examination, operating, or condition reports prepared section 1203.9 of this Part will be publicly announced by, on behalf of, or for the use of an agency respon­ at the earliest practicable time. sible for the regulation or supervision of financial insti­ (d) Public announcements required by this section will tutions; be posted at the office of the Executive Secretary of (9) disclose information the premature disclosure of the Committee, Federal Reserve Building, 20th Street which would— and Constitution Avenue, N.W., Washington, D.C. (A) be likely to (i) lead to significant speculation 20551 and may be made available by other means or at in currencies, securities, or commodities, or (ii) other locations as may be desirable. significantly endanger the stability of any financial (e) Immediately following each public announcement institution; or required by this section, notice of the time, place and (B) be likely to significantly frustrate implemen­ subject matter of a meeting, whether the meeting is tation of a proposed action, except that subpara­ open or closed, any change in one of the preceding graph (B) shall not apply in any instance where announcements, and the name and telephone number the agency has already disclosed to the public the of the Executive Secretary or other official designated content or nature of its proposed action, or where by the Committee to respond to requests about the the agency is required by law to make such dis­ meeting, shall also be submitted for publication in the closure on its own initiative prior to taking final Federal Register. action on such proposal; or (10) specifically concern the issuance of a sub­ Section 1203.7—Meetings Closed to Public poena, participation in a civil action or proceeding, an Observation Under Expedited Procedures action in a foreign court or international tribunal, or an arbitration, or the initiation, conduct, or disposition of (a) The Committee has concluded that a majority of its a particular case of formal agency adjudication pur­ meetings would be properly closed to the public pur­ suant to the procedures in section 554 of Title 5 of the suant to paragraph (4), (8), (9)(A), or (10) of subsection United States Code or otherwise involving a determi­ (C) of the Act and, therefore, the Committee qualifies nation on the record after opportunity for a hearing. for the use of expedited procedures under subsection (d)(4) of the Act. Accordingly, meetings or portions Section 1203.6—Public Announcements of thereof exempt under paragraph (4), (8), (9)(A) or (10) Meetings of section 1203.5 of this Part, will be closed to public observation under the expedited procedures of section (a) Except as otherwise provided by the Act, public (d)(4) of the Act. An example of the type of item that, announcement of meetings open to public observation absent compelling contrary circumstances, will qualify and meetings to be partially or completely closed to for expedited procedures is changes in the rates of in­ public observation pursuant to section 1203.8 of this terest that federally insured banks, savings and loan Part will be made at least one week in advance of the associations and mutual savings banks may pay on de­ meeting. Except to the extent such information is de­ posits. termined to be exempt from disclosure under section (b) At the beginning of each meeting, a portion or por­ 1203.5 of this Part, each such public announcement tions of which is closed to public observation under will state the time, place and subject matter of the expedited procedures pursuant to this section, a re­ meeting, whether it is open or closed to the public, and corded vote of the members present will be taken to the name and phone number of the official designated determine whether a majority of the voting members to respond to requests for information about the meet­ of the agency votes to close such meeting or portions ing. of such meeting to public observation. (b) If a majority of the voting members of the agency (c) A copy of the vote, reflecting the vote of each mem­ determines by a recorded vote that agency business ber, and except to the extent such information is deter­ requires that a meeting covered by subsection (a) of mined to be exempt from disclosure under section this section be called at a date earlier than that speci­ 1203.5 of this Part, a public announcement of the time, fied in subparagraph (a), the agency will make a public place, and subject matter of the meeting or each closed Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

502 Federal Reserve Bulletin □ June 1980 portion thereof, will be made available at the earliest transmit the request to the members of the Committee practicable time at the office of the Executive Secre­ and upon the request of any member a recorded vote tary of the Committee. will be taken whether to open such meeting to public observation. Section 1203.8—Meetings Closed to Public Observation Under Regular Procedures Section 1203.9—Changes With Respect to Publicly Announced Meeting (a) A meeting or a portion of a meeting will be closed to public observation, or information as to such meet­ The subject matter of a meeting or the determination ing or portion of a meeting will be withheld, only by to open or close a meeting or a portion of a meeting to recorded vote of a majority of the voting members of public observation may be changed following public the agency when it is determined that the meeting or announcement under section 1203.6 only if a majority the portion of the meeting or the withholding of infor­ of the voting members of the agency determines by a mation qualifies for exemption under section 1203.5 of recorded vote that agency business so requires and this Part. A separate vote of the voting members of the that no earlier announcement of the change was pos­ agency will be taken with respect to each meeting sible. Public announcement of such change and the which is proposed to be closed in whole or in part to vote of each member upon such change will be made the public. A single vote may be taken with respect to pursuant to section 1203.6(c) of this Part. Changes in a series of meetings which are proposed to be closed in time, including postponements and cancellations of a whole or in part to the public, or with respect to which publicly announced meeting or changes in the place of information is proposed to be withheld, so long as each a publicly announced meeting will be publicly an­ meeting in the series involves the same particular mat­ nounced pursuant to section 1203.6(c) of this Part by ters and is scheduled to be held no more than 30 days the Executive Secretary of the Committee. after the initial meeting in the series. The vote of each voting member of the agency will be recorded and no Section 1203.10—Certification of the General proxies will be allowed. Counsel (b) Whenever any person’s interests may be directly affected by a portion of a meeting for any of the rea­ Before every meeting or portion of a meeting closed to sons referred to in exemptions (5), (6) or (7) of section public observation under sections 1203.7 or 1203.8 of 1203.5 of this Part, such person may request in writing this Part, the General Counsel shall publicly certify to the Executive Secretary of the Committee that such whether or not in his or her opinion the meeting may portion of the meeting be closed to public observation. be closed to public observation and shall state each The Executive Secretary will transmit the request to relevant exemptive provision. A copy of such certifi­ the members and upon the request of any one of them cation, together with a statement from the presiding a recorded vote will be taken whether to close such officer of the meeting setting forth the time and place meeting to public observation. of the meeting and the persons present, will be re­ (c) Within one day of any vote taken pursuant to sub- tained for the time prescribed in section 1203.11(d) of paragraphs (a) and (b) of this section, the agency will this Part. make publicly available at the office of the Executive Secretary a written copy of such vote reflecting the Section 1203.11—Transcripts, Recordings, and vote of each voting member on the question. If a meet­ Minutes ing or a portion of a meeting is to be closed to public observation, the agency, within one day of the vote (a) The agency will maintain a complete transcript or taken pursuant to subparagraphs (a) and (b) of this sec­ electronic recording or transcription thereof adequate tion, will make publicly available at the office of the to record fully the proceedings of each meeting or por­ Executive Secretary a full, written explanation of its tion of a meeting closed to public observation pursuant action closing the meeting or portion of the meeting to exemptions (1), (2), (3), (4), (5), (6), (7) or (9)(B) of together with a list of all persons expected to attend section 1203.5 of this Part. Transcriptions of record­ the meeting and their affiliation, except to the extent ings will disclose the identity of each speaker. such information is determined by the agency to be (b) The agency will maintain either such a transcript, exempt from disclosure under subsection (c) of the Act recording or transcription thereof, or a set of minutes and section 1203.5 of this Part. that will fully and clearly describe all matters dis­ (d) Any person may request in writing to the Executive cussed and provide a full and accurate summary of any Secretary of the Committee that an announced closed actions taken and the reasons therefor, including a de­ meeting, or portion of the meeting, be held open to scription of each of the views expressed on any item public observation. The Executive Secretary will and the record of any roll call vote (reflecting the vote Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 503 of each voting member on the question), for meetings ance Act and section 5B(a) of the Federal Home Loan or portions of meetings closed to public observation Bank Act. pursuant to exemptions (8), (9)(A) or (10) of section 1203.5 of this Part. The minutes will identify all docu­ Part 1204—Interest on Deposits ments considered in connection with any action taken. (c) Transcripts, recordings or transcriptions thereof, Section 1204.101—Withdrawal of Interest or minutes will promptly be made available to the pub­ lic in the office of the Executive Secretary of the Com­ A depository institution subject to the authorities con­ mittee except for such item or items of such discussion ferred by section 19(j) of the Federal Reserve Act (12 or testimony as may be determined to contain informa­ U.S.C. 371b), section 18(g) of the Federal Deposit In­ tion that may be withheld under subsection (c) of the surance Act (12 U.S.C. 1828(g), or section 5B(a) of the Act and section 1203.5 of this Part. Federal Home Loan Bank Act (12 U.S.C. 1425(a)) (d) A complete verbatim copy of the transcript, a may permit a depositor to withdraw interest credited complete copy of the minutes, or a complete electronic to a time certificate of deposit or account during any recording or verbatim copy of the transcription thereof term at any time during such term without penalty. If of each meeting or portion of a meeting closed to pub­ the deposit or account is renewed automatically on the lic observation will be maintained for a period of at same terms (including at the same rate of interest), in­ least two years or one year after the conclusion of any terest during the preceding term or terms as well as the agency proceeding with respect to which the meeting renewal term may be paid at any time during the re­ or portion thereof was held, whichever occurs later. newal term without penalty, unless the deposit agree­ ment specifically provides otherwise. If the rate of in­ Section 1203.12—Procedures for Inspection and terest paid during the renewal term or the maturity Obtaining Copies of Transcriptions and Minutes period of the renewal term is different, interest in the account at the commencement of the renewal term (a) Any person may inspect or copy a transcript, a shall be treated as principal and only interest for the recording or transcription of a recording, or minutes renewal term may be paid at any time without penalty described in section 1203.11(c) of this Part. during such term. (b) Requests for copies of transcripts, recordings or transcriptions of recordings, or minutes described in Section 1204.102—Payment of Interest on Time section 1203.11(c) of this Part shall specify the meeting Deposits. or the portion of the meeting desired and shall be sub­ mitted in writing to the Executive Secretary of the A depository institution subject to the authorities con­ Committee, Federal Reserve Building, 20th Street and ferred by section 19(j) of the Federal Reserve Act (12 Constitution Avenue, N.W., Washington, D.C. 20551. U.S.C. 371b), section 18(g) of the Federal Deposit In­ Copies of documents identified in minutes may be surance Act (12 U.S.C. 1828(g)), or section 5B(a) of made available to the public upon request under the the Federal Home Loan Bank Act (12 U.S.C. 1425(a)), provisions of Part 1202 of this Chapter (Rules Regard­ may provide in any time deposit contract that if the ing Availability of Information). deposit or any portion thereof is withdrawn not more than seven days after a maturity date, interest will be Section 1203.13—Fees paid thereon at the originally specified contract rate. An institution may specify in the time deposit contract (a) Copies of transcripts, recordings and transcrip­ the interest will be paid at any other lower rate. How­ tions of recordings, or minutes requested pursuant to ever, in no event may the rate specified be less than section 1203.12(b) of this Part will be provided at a the current rate paid on regular savings accounts by cost of 100 per standard page for photocopying or at a the institution. cost not to exceed the actual cost of printing, typing, Effective June 2, 1980, the Committee adopted Sec­ or otherwise preparing such copies. tion 1204.103 as follows: (b) Documents may be furnished without charge where total charges are less than $2. Section 1204.103—Penalty for Early The Committee has adopted a final rule concerning Withdrawals the treatment of interest earned on time deposit funds for purposes of the early withdrawal penalty. The rule Where a time deposit with an original maturity of one applies to all commercial banks, mutual savings banks, year or less, or any portion thereof, is paid before and savings and loan associations subject to the au­ maturity, a depositor shall forfeit an amount at least thorities conferred by section 19(j) of the Federal Re­ equal to three months of interest earned, or that could serve Act, section 18(g) of the Federal Deposit Insur­ have been earned, on the amount withdrawn at the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

504 Federal Reserve Bulletin □ June 1980 nominal (simple interest) rate being paid on the depos­ Section 1204.105—26-Week Money Market Time it, regardless of the length of time the funds withdrawn Deposits of Less Than $100,000. have remained on deposit. Where a time deposit with an original maturity of more than one year, or any por­ Notwithstanding any other limitations, during the peri­ tion thereof, is paid before maturity, a depositor shall od May 29, 1980 through November 30, 1980, a com­ forfeit an amount at least equal to six months of inter­ mercial bank may renew maturing 26-week money est earned, or that could have been earned, on the market certificates with the same depositor at a rate of amount withdrawn at the nominal (simple interest) rate interest equal to the ceiling rate of interest payable on being paid on the deposit, regardless of the length of such certificates by mutual savings banks and savings time the funds withdrawn have remained on deposit. and loan associations. The Committee amended Part 1204 by adding sec­ tions 104, 105 and 106 effective as follows: 3. Effective June 2, 1980: 1. Effective June 5, 1980: Section 1204.106—Time Deposits of Less Than Section 1204.104—26-Week Money Market Time $100,000 With Maturities of 2xh Years or More. Deposits of Less than $100,000. (a) Beginning on Thursday of every other week, a Commercial banks, mutual savings banks, and savings commercial bank may pay interest on any non­ and loan associations may pay interest on any non­ negotiable time deposit with a maturity of 2lh years or negotiable time deposit of $10,000 or more, with a more at a rate not to exceed the higher of one-quarter maturity of 26 weeks, at a rate not to exceed the rates 'of one per cent below the average 2xh year yield for set forth below. Rounding any rate to the next higher United States Treasury securities as determined and rate is not permitted and interest may not be com­ announced by the United States Department of the pounded during the term of this deposit. Treasury immediately prior to such Thursday, or 9.25 per cent. The average 2xh year yield will be rounded by the United States Department of the Treasury to Rate established (auction the nearest 5 basis points. In no event shall the rate of average on a discount interest paid exceed 11.75 per cent. basis) for U.S. Treasury bills with maturities of 26 (b) Beginning on Thursday of every other week, a mu­ weeks issued on or tual savings bank or savings and loan association may immediately prior to the date of deposit (“Bill pay interest on any nonnegotiable time deposit with a Rate ’ ’) Maximum per cent maturity of 2V2 years or more at a rate not to exceed the higher of the average 272 year yield for United Commercial Banks States Treasury securities as determined and an­ nounced by the United States Department of the 7.50 per cent or below 7.75 Treasury immediately prior to such Thursday, or 9.50 Above 7.50 per cent Bill Rate plus one-quar­ per cent. The average 2lh year yield will be rounded ter of one per cent by the United States Department of the Treasury to the nearest 5 basis points. In no event shall the rate of interest paid exceed 12.00 per cent. Mutual Savings Banks and Savings and Loan Associations 7.25 per cent or below 7.75 Bank Holding Company and Bank Merger Orders Issued by the Board of Governors Above 7.25 per cent, Bill Rate plus one-half but below 8.50 per cent of one per cent Orders Under Section 3 of Bank Holding Com­ pany Act 8.50 per cent, but below Banco Exterior De Espana, S.A., 8.75 per cent Madrid, Spain 8.75 per cent or above Bill Rate plus one-quar­ ter of one per cent Order Approving Acquisition of Bank Banco Exterior de Espana, S.A., Madrid, Spain, a 2. Effective May 29, 1980: bank holding company within the meaning of the Bank Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 505 Holding Company Act, has applied for the Board’s ap­ significantly increase the concentration of banking re­ proval under section 3 (a)(3) of the Act (12 U.S.C. § sources in any relevant area. 1842(a)(3)) to acquire 100 percent of the voting shares The financial and managerial resources of Applicant (less directors qualifying shares) of Bank of Suffolk and its subsidiary bank are considered satisfactory and County (“Bank”), Stony Brook, New York. the future prospects for each appear favorable. The fi­ Notice of the application, affording opportunity for nancial and managerial resources and future prospects interested persons to submit comments and views, has of Bank will be strengthened significantly by affiliation been given in accordance with section 3(b) of the Act. with Applicant in light of Applicant’s plans to merge The time for filing comments and views has expired, Bank into Century Bank and to increase the capital of and the Board has considered the application and all the resulting banking organization. Thus, banking fac­ comments received in light of the factors set forth in tors lend weight toward approval of the application. section 3(c) of the Act (12 U.S.C. § 1842(c)). Bank’s customers will be provided access to the inter­ Applicant, a Spanish bank with total assets of ap­ national services currently offered by Century Bank. proximately $9.6 billion and total deposits of $4.8 bil­ Thus, considerations relating to the convenience and lion,1 is the 174th largest bank in the world. A majority needs of the community to be served, together with of Applicant’s shares are owned by the Spanish Gov­ favorable banking considerations, are sufficient to out­ ernment2 and it conducts a full range of commercial weigh the slightly adverse competitive effects associ­ banking services in Spain that are principally directed ated with the proposal. Accordingly, the Board con­ toward the financing of exports. Applicant has 191 cludes that consummation of the proposal would be in branches within Spain arid has interests in banks and the public interest and that the application should be financially related companies organized and operating approved. in several foreign countries. Applicant through its subsidiary, Trubia, S.A., Ma­ Applicant, through its control of Century National drid, Spain, holds all of the shares of 46 West 55th Bank & Trust Company (“Century Bank”), New Street Corporation (“Corporation”), New York, New York, New York, ($57.2 million in deposits),3 is the York. Applicant asserts that its holding of Corporation 71st largest of 108 commercial banking organizations is permissible under section 2(h) of the Act (12 U.S.C. located in the Metropolitan New York banking mar­ § 1841(h)) in that Trubia is principally engaged in busi­ ket,4 controlling less than 0.1 percent of total com­ ness outside the United States, and that Corporation mercial bank deposits in the market. Bank, ($74.0 mil­ and Trubia are engaged in the same line of business, lion in deposits), is the 52nd largest banking namely, owning and operating non-residential build­ organization in the Metropolitan New York market ings. The Board recently proposed for public comment and controls 0.1 percent of market deposits. Upon regulations implementing section 2(h) (45 Federal Reg­ consummation of the proposed acquisition, Applicant ister 30,082). If the regulations are adopted by the Board would rank as the 44th largest commercial banking or­ as proposed, Applicant’s indirect ownership of Corpora­ ganization in the market with slightly more than 0.1 tion would be prohibited. Should Applicant’s holding percent of market deposits. In view of the competitive of Corporation become impermissible, the Board ex­ structure of the market and the relatively small size of pects that Applicant will conform its activities to the Bank and Century Bank, the Board is of the opinion requirements of those regulations when they are that consummation of the transaction would have only adopted. a slightly adverse effect on competition and would not On the basis of the record, the application is ap­ proved for the reasons summarized above. The trans­ action shall not be made before the thirtieth calendar day following the effective date of this Order or later than three months after the effective date of this Or­ 1. Unless otherwise noted, all banking data are as of December 31, 1979. der, unless such period is tended for good cause by the 2. Title IX of the Depository Institutions Deregulation and Mone­ Board, or by the Federal Reserve Bank of New York tary Control Act of 1980 (Pub. L. 96-221) provides that the Board may not approve an application by a foreign organization to acquire a do­ pursuant to delegated authority. mestic financial institution until July 1, 1980, unless, among other rea­ By order of the Board of Governors, effect May 21, sons, the institution has less than $100 million in deposits or the appli­ 1980. cation was submitted for filing on or before March 5, 1980. The application was submitted for filing on February 14, 1980, and, as of March 31, 1980, Bank had $70.3 million in deposits. Thus, the Board is Voting for this action: Vice Chairman Schultz and Gover­ not prohibited from approving the subject applications. nors Wallich, Teeters, and Rice. Absent and not voting: 3. Market data are as of June 30, 1979. Chairman Volcker and Governor Partee. 4. The Metropolitan New York banking market consists of the five boroughs of New York City, plus Nassau, Westchester, Putnam and Rockland Counties and western Suffolk County in New York State; the northern two-thirds of Bergen County and eastern Hudson County (Signed) Griffith L. Garwood, in New Jersey; and southwestern Fairfield County in Connecticut. [seal] Deputy Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

506 Federal Reserve Bulletin □ June 1980 The Bank Holding Company of Santa Fe, policies adopted by Applicant’s principals, will pro­ Santa Fe, New Mexico vide it with sufficient financial flexibility to meet its debt-servicing requirements over a 15 year debt retire­ Order Approving Formation of ment period, without adversely affecting the financial Bank Holding Company condition of Bank. Moreover, based upon the fact of record it appears that Applicant will attain a debt-to- The Bank Holding Company of Sante Fe, Santa Fe, equity ratio of not more than 30 percent within 12 New Mexico, has applied for the Board’s approval un­ years after consummation of the proposed acquisition. der section 3(a)(1) of the Bank Holding Company Act Accordingly, the Board concludes that banking factors (12 U.S.C. § 1842(a)(1)) of formation of a bank holding are consistent with approval of the application. company by acquiring 86.24 percent of the voting While no immediate changes in Bank’s operations or shares of Bank of Santa Fe, Santa Fe, New Mexico in the services offered to its customers are anticipated (“Bank”). to follow from consummation of the proposed acquisi­ Notice of the application, affording opportunity for tion, convenience and needs considerations are con­ interested persons to submit comments and views, has sistent with approval of this application. Based upon been given in accordance with section 3(b) of the Act. the foregoing and other considerations reflected in the The time for filing comments and views has expired, record, the Board concludes that consummation of the and the Board has considered the application and all proposal would be consistent with the public interest comments received, including those of the New Mexi­ and that the application should be approved. co State Director of Banking, in light of the factors set On the basis of the record, the application is ap­ forth in section 3(c) of the Act (12 U.S.C. § 1842(c)). proved for the reasons summarized above. The trans­ Applicant, a nonoperating corporation with no sub­ action shall not be made before the thirtieth calendar sidiaries, was organized for the purpose of becoming a day following the effective date of this Order or later bank holding company through the acquisition of than three months after the effective date of this Or­ Bank, which holds deposits of $68.5 million.1 Upon der, unless such period is extended for good cause by consummation of the proposal, Applicant would con­ the Board of Governors or by the Federal Reserve trol approximately 1.6 percent of total deposits in com­ Bank of Kansas City, pursuant to delegated authority. mercial banks in the state of New Mexico. By order of the Board of Governors, effective May Bank is the third largest of five banking organiza­ 19, 1980. tions in the relevant banking market2 and controls 21.9 percent of commercial bank deposits in that market. Voting for this action: Chairman Volcker and Governors Although a number of Applicant’s principals are also Schultz, Partee, Teeters, and Rice. Absent and not voting: Governor Wallich. associated with other banking organizations, none of these banking organizations compete in the relevant banking market. Therefore, it appears that no existing (Signed) Griffith L. Garwood, competition would be eliminated as a result of con­ [seal] Deputy Secretary of the Board. summation of this proposal. Moreover, the proposed transaction represents a reorganization whereby own­ Commerce Bank Corporation, ership of Bank will be transferred from individuals to a Lake City, Florida corporation owned by the same individuals. There­ fore, it appears that consummation of this proposal Order Denying Formation of a Bank Holding would have no adverse effect upon existing or poten­ Company tial competition, nor would it increase the concentra­ tion of banking resources in any relevant market. Commerce Bank Corporation, Lake City, Florida, has Accordingly, the Board concludes that competitive applied for the Board’s approval under section 3(a)(1) considerations associated with this proposal are con­ of the Bank Holding Company Act (12 U.S.C. § sistent with approval of the application. 1842(a)(1)) of formation of a bank holding company by The financial and managerial resources and future acquiring 85 percent or more of the voting shares of prospects of Applicant and Bank are generally satis­ The First National Bank of Lake City (“Bank”), Lake factory. Although Applicant will incur debt in con­ City, Florida. nection with its acquisition of Bank’s shares, it ap­ Notice of the application, affording opportunity for pears that Applicant’s proposal, including recent interested persons to submit comments and views, has been given in accordance with section 3(b) of the Act. 1. All banking data are as of June 30, 1979. The time for filing comments and views has expired, 2. The relevant banking market is the Santa Fe RMA which in­ cludes the city of Santa Fe, and the communities of Agua Fria and and the Board has considered the application and all Tesuque; all in New Mexico. comments received, including those on behalf of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 507 Comptroller of the Currency expressing no objection cant’s voting shares.4 Refinery and Pipeline would to the proposal, in light of the factors set forth in sec­ continue to engage in their nonbanking activities. tion 3(c) of the Act (12 U.S.C. § 1842(c)). The Board has previously expressed its view that Bank holds deposits of $28.8 million, which repre­ when several related corporations act at the direction sent less than one percent of the total deposits in com­ and under the control of an individual to acquire mercial banks in Florida.1 Bank is the second largest shares of a bank holding company, they may consti­ of three banks competing in the relevant banking mar­ tute an “association” for purposes of section 2(b) of ket2 and holds approximately 33.8 percent of the mar­ the Bank Holding Company Act.5 Under the Act if an ket’s total deposits in commercial banks. Inasmuch as association acquires 25 percent or more of the voting Applicant controls no other bank, and no principal of shares of a bank or bank holding company, the associ­ Applicant is a principal of any other bank located in ation would itself become a bank holding company.6 the relevant banking market, consummation of the This proposal resembles the one on which the Board proposed transaction would have no adverse effects on based its earlier decision. Newton controls 75 percent either existing or potential competition and would not of the voting shares of Refinery, and is trustee of one increase the concentration of resources in any relevant of the two general partners of Pipeline, which, accord­ area. Therefore, competitive considerations are con­ ing to Applicant, was organized in part “as a vehicle to sistent with approval. recognize special services performed by key employ­ Under the proposal, there would be a change in the ees of [Refinery].” Furthermore, the bank loan en­ control of Bank. The financial and managerial re­ abling Pipeline to purchase Applicant’s shares would sources and future prospects of Applicant are consid­ be guaranteed by Refinery. While Pipeline is a sepa­ ered satisfactory, and Applicant would be able to rate company, it is sufficiently clear that with respect serve as a source of financial and managerial strength to this transaction Newton principally controls it and for Bank. Accordingly, banking factors lend weight to­ has directed the structure of the proposed holdings. ward approval of the application. While there would Indeed, Applicant states that Newton controls both be no immediate increase in the services offered by Refinery and Pipeline and intends to control Bank. On Bank as a result of the proposed transaction, the con­ the basis of the facts of record, the Board finds that siderations relating to the convenience and needs of the community to be served are consistent with ap­ proval of the application. The Board believes, however, that Applicant’s pro­ posed ownership structure precludes approval of its 4. The remaining voting shares of Applicant would be held as fol­ application to become a bank holding company. Mr. lows: Mr. Larry Delpit, who is a business associate of Newton, the other owner of Refinery and the other trustee of a Pipeline general Russell B. Newton, Jr. (“Newton”), a principal of Ap­ partner, would hold 23.1 percent, and Mr. D. S. Cish, an employee of plicant, owns 75 percent of the voting shares and is Refinery, and the Newton children would together own the remaining chairman and chief executive officer of Kern County 5.8 percent. 5. In 1978, the United States District Court for the District of Wyo­ Refinery, Inc. (“Refinery”), a crude oil refining and ming asked the Board to respond to questions regarding a tender offer marketing corporation. He is also trustee of one of two made for shares of a bank holding company, Wyoming Bancorpora­ family trusts that are general partners of Panama Pipe­ tion (“Wybanco”), Cheyenne, Wyoming, by Mr. Roy G. Dinsdale on behalf of six bank holding companies controlled by him and his family. line Limited (“Pipeline”), a limited partnership own­ Although together the Dinsdale group intended to purchase up to 24 ing crude oil pipelines and interests in real estate de­ percent of Wybanco’s shares under the proposal, no one of the Dins­ dale companies would purchase more than 5 percent of Wybanco’s velopment and a semi-submersible oil drilling rig. Both voting shares. One of the questions addressed to the Board was Refinery and Pipeline are companies as defined in sec­ whether the Dinsdale bank holding companies participating in the Wy­ tion 2(b) of the Act. 12 U.S.C. § 1841(b). Pipeline oper­ banco tender offer would together constitute a “company” under the Act. (A bank holding company generally does not need the Board’s ates in part for the benefit of the limited partners who approval to acquire 5 percent or less of the voting shares of a bank or must be, by terms of the partnership agreement, em­ bank holding company. To acquire more it must file an application, ployees of Refinery. and since the Dinsdale companies were located outside Wyoming the Board should not have approved such an application by any of them. The application proposes that Refinery acquire 24.9 12 U.S.C. § 1842(d)). percent of Applicant’s voting shares,3 and that Pipe­ The Board concluded that the group of six Dinsdale holding com­ panies would be a bank holding company under the Act because in line and Newton each acquire 23.1 percent of Applimaking the tender offer for Wybanco, the Dinsdale companies were acting as a group with a single purpose and at the direction and under the control of Mr. Dinsdale, rather than independently of one another 1. All banking data are as of December 31, 1978. as passive investors. The Board found that because of their common 2. The relevant banking market is approximated by Columbia ownership and the control exercised over them by Mr. Dinsdale, the County, Florida. companies were incapable of independent action, and they would to­ 3. Refinery would also acquire all Applicant’s non-voting shares gether constitute a “company” under the Act with respect to their and would guarantee a bank loan made to Pipeline so that Pipeline proposed acquisition of Wybanco. Letter of November 17, 1978, from could acquire Applicant’s shares. Refinery would refrain from voting the Secretary of the Board to William C. Beaman. the shares of Applicant it owned for ten years. 6. 12 U.S.C. § 1842(a)(2)(A). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

508 Federal Reserve Bulletin □ June 1980 Refinery and Pipeline constitute an association for pur­ F&M Bankshares, Inc. poses of their proposed indirect acquisition of Bank.7 Marinette, Wisconsin Having determined that Refinery and Pipeline con­ stitute an association in view of substantially common Order Approving Formation of Bank Holding ownership and control by Newton in the proposed en­ Company terprise, the Board finds that the association would constitute a bank holding company under this pro­ F&M Bankshares, Inc., Marinette, Wisconsin, has ap­ posal, since together Pipeline and Refinery would own plied for the Board’s approval under section 3(a)(1) of 48 percent of Applicant’s voting shares. As they have the Bank Holding Company Act (12 U.S.C. § 1842(a)(1)) not applied for approval to become a bank holding of formation of a bank holding company by acquiring company, consummation of the proposal would place 80 percent or more of the voting shares of Farmers & them in violation of Section 3(a)(1) of the Act. Ap­ Merchants Bank & Trust (“Farmers”), Marinette, proval of this proposal would result in indirect owner­ Wisconsin, and 100 percent of the voting shares of ship of a bank by a company engaged in activities Citizens Bank of Marinette (“Citizens”), Marinette, that are clearly impermissible for a bank holding com­ Wisconsin. pany, and would condone a clear evasion of the Act’s Notice of the application, affording opportunity for purposes.8 interested persons to submit comments and views, has On the basis of the foregoing and the facts of record, been given in accordance with § 3(b) of the Act. The the Board finds the structure of the proposed transac­ time for filing comments and views has expired, and tion precludes approval of the application, and con­ the Board has considered the application along with cludes that an order denying the proposed bank hold­ timely comments received from four competing banks ing company formation is necessary to enable the (“Protestants”)1 in light of the factors set forth in § Board to administer and carry out the purposes of the 3(c) of the Act (12 U.S.C. § 1842(c)). Act and prevent evasions thereof. While the other stat­ Applicant is a nonoperating corporation organized utory factors the Board is required to consider in act­ for the purpose of becoming a bank holding company ing on the application are consistent with approval, by acquiring Farmers, with deposits of $38.4 million,2 they cannot offset a proposed structure that would re­ and Citizens, a proposed new bank. Upon acquiring sult in a violation of the prior approval requirements of these banks Applicant would become the 110th largest the Act and an impermissible combination of com­ banking organization in the state of Wisconsin with merce and banking. Accordingly, the application is de­ 0.2 percent of commercial bank deposits in the state. nied for the reasons summarized above. Farmers is the largest of 10 banks in the Marinette- By order of the Board of Governors, effective May Menominee banking market,3 holding 16.0 percent of 27, 1980. commercial bank deposits in the market. Applicant’s proposal represents a restructuring of Farmers’ own­ Voting for this action: Vice Chairman Schultz and Gover­ ership from individual to corporate form, and the ac­ nors Wallich, Teeters, and Rice. Absent and not voting: quisition of Citizens, a proposed new bank, and the Chairman Volcker and Governor Partee. proposal will not eliminate existing or potential com­ petition in that market. Protestants, however, allege (Signed) Theodore E. Allison, that permitting affiliation between Farmers and Citi­ [seal] Secretary of the Board. zens will permit expansion of the largest organization 7. If the 48 percent of the shares of Applicant were held by one in the market into an attractive location near a new company controlled by Newton, that company would be a bank hold­ shopping mall and serve to perpetuate its dominance in ing company under the Act, and the Board could approve its appli­ Marinette. While under some circumstances de novo cation only if it agreed to divest its impermissible activities. The Board believes that an individual, by arbitrarily dividing such an ownership interest between two organizations that he controls, should not be companies and the clearly impermissible nature of their activities, or able automatically to escape supervision or to avoid the nonbanking for some other reason, control proceedings were begun and the pre­ prohibitions of the Act. This circumstance should be distinguished sumption against either company were not successfully rebutted, that from previous Orders in which the Board has held that a group of company would have to divest its banking or its nonbanking assets. companies that are not commonly controlled, each holding less than 5 Such an eventuality could have adverse consequences to Applicant’s percent or less than 25 percent of the voting shares of a bank or a bank resources and prospects, and its ability to serve as a source of strength holding company, did not constitute a bank holding company under to Bank, and it is not such a remote possibility that the Board could the Act unless there was a “formalized structure” for control among disregard it. these company-shareholders. See, WISCUB, Inc., 65 Federal Re­ 1. First National Bank of Marinette, Marinette, Wisconsin; Ste­ serve Bulletin 773 (1979), and cases cited there. phenson National Bank and Trust, Marinette, Wisconsin; Peshtigo 8. Even if Pipeline and Refinery are viewed separately rather than National Bank, Peshtigo, Wisconsin; and Peshtigo State Bank, Pesh­ as a single company for purposes of their investment in Applicant, a tigo, Wisconsin. difficulty remains. Each company would be presumed to control Ap­ 2. All financial data are as of December 31, 1978. plicant under the Board’s rebuttable presumption of control, 12 3. The Marinette-Menomiee banking market is defined as the C.F.R. § 225.2(b). If, because of the large proportion of Applicant’s southern half of Menominee County, Michigan, and the southern shares that will be held by the companies, the close relation of the two three-fourths of Marinette County, Wisconsin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 509 expansion in a market by a leading organization within Board concludes that considerations relating to the that market could reduce prospects for market decon­ convenience and needs of the community to be served, centration by preempting a viable site for de novo en­ including Farmers’ CRA record, are consistent with try or expansion by other firms, the Marinette-Me- approval of the application. Accordingly, it is the nominee market is not highly concentrated, and there Board’s judgment that consummation of Applicant’s are numerous other viable banking alternatives in the proposal would be in the public interest and that the market. The Board concludes that approval of this ap­ application should be approved. plication would not result in any adverse effects on On the basis of the record, the application is ap­ competition. proved for the reasons summarized above. The trans­ The financial and managerial resources and future actions shall not be made (a) before the thirtieth calen­ prospects of Applicant and Farmers are regarded as dar day following the effective date of this Order or (b) generally satisfactory. As a proposed new bank, Citi­ later than three months after that date, and (c) Citizens zens has no financial operating history; however, its shall be opened for business not later than six months prospects as a subsidiary of Applicant appear favor­ after the effective date of this Order. Each of the peri­ able. While Applicant will incur debt in connection ods described in (b) and (c) may be extended for good with the establishment of Citizens, it appears that Ap­ cause by the Board, or by the Federal Reserve Bank of plicant will have sufficient flexibility to retire the debt Chicago pursuant to delegated authority. without adversely affecting the capital position of ei­ By order of the Board of Governors, effective May ther bank. The Board concludes that banking factors 21, 1980. are consistent with approval of the application. While approval of this application will result in no Voting for this action: Vice Chairman Schultz and Gover­ change in the services provided by Farmers, the estab­ nors Wallich, Teeters, and Rice. Absent and not voting: lishment of Citizens would provide a new and conve­ Chairman Volcker and Governor Partee. nient full-service banking alternative for the area’s residents. Protestants allege, however, that Farmers (Signed) Griffith L. Garwood, has a poor record of service to its local community [seal] Deputy Secretary of the Board. under the Community Reinvestment Act (“CRA”). Specifically they state: that Farmers requires higher down payments on mortgage loans than other financial Semo Bancshares, Corporation, institutions in the area, a practice which Protestants Malden, Missouri contend disadvantages low income applicants; that Farmers is unwilling to advertise the availability of Order Denying Formation of a Bank Holding mortgage credit to lower income families; that Farm­ Company ers does not issue an adequate volume of Small Busi­ ness Administration loans; and that Farmers has failed Semo Bancshares, Corporation, Malden, Missouri, to review its CRA statement annually as required by has applied for the Board’s approval under section the Federal Deposit Insurance Corporation’s CRA 3(a)(1) of the Bank Holding Company Act of 1956 (12 Regulation. The Board finds that Farmers has met the U.S.C. § 1842(a)(1)) of formation of a bank holding procedural requirements of the CRA Regulation, in­ company by acquiring 98.6 percent of the voting cluding annual review. It has reasonably defined its shares of Malden State Bank, Malden, Missouri community and is active in making loans of types list­ (“Bank”). ed on its CRA statement in its community. There are Notice of the application, affording opportunity for no defined low and moderate income areas in Farmers’ interested persons to submit comments and views, has community, and Farmers advertises its services gener­ been given in accordance with section 3(b) of the Act. ally on the radio. No customers, or would-be custom­ The time for filing comments and views has expired, ers, of Farmers have complained about its services. and the Board has considered the application and all The CRA does not require the Board to dictate the comments received in light of the factors set forth in portfolio composition of a bank. Thus, protestants’ section 3(c) of the Act (12 U.S.C. § 1842(c)). complaints about Small Business Administration loans Applicant is a nonoperating corporation with no and advertising policies are without merit. While the subsidiaries, organized for the purpose of becoming a Board will consider the effects of advertising policies bank holding company through the acquisition of where there is evidence to suggest discriminatory Bank, which has deposits of $29.8 million.1 Upon aclending, that is not the case here. Farmers’ down-payment policy appears to have been adopted in response to temporary financial conditions, and there is no evi­ dence that its lending has been discriminatory. The 1. All banking data are as of September 30, 1979. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

510 Federal Reserve Bulletin □ June 1980 quisition of Bank, Applicant would control one of the longstanding in nature, approval of the subject pro­ smaller commercial banks in the state. posal would further solidify this anticompetitive rela­ Bank is the larger of two banking organizations in tionship. the city of Malden and is the largest of six banking With regard to banking factors, with Board has in­ organizations in the Malden banking market,2 con­ dicated on previous occasions that a holding company trolling 39.2 percent of the market’s commercial bank should serve as a source of financial and managerial deposits. This proposal involves a restructuring of strength to its subsidiary banks, and the Board exam­ Bank’s ownership from individuals to a corporation ines closely the managerial resources, financial condi­ controlled by the same individuals. Bank is affiliated tion, and future prospects of each applicant with this with two other banks in the relevant market—State consideration in mind. In this case, the Board con­ Bank of Campbell, Campbell, Missouri (“Campbell cludes that the record presents adverse financial con­ Bank”), and State Bank of Bernie, Bernie, Missouri siderations that warrant denial of the proposal to form (“Bernie Bank”). Campbell Bank, with deposits of a bank holding company. $12.3 million (16.2 percent of market deposits), is the With respect to financial considerations, the Board second largest bank in the market and is 10 road miles notes that Applicant would incur debt in connection southwest of Bank. Bernie Bank, with deposits of with its proposed acquisition of Bank’s shares in order $11.8 million (15.5 percent of market deposits), is the to increase Bank’s equity capital position. Applicant third largest bank in the market and is eight road miles proposes to service this debt with dividends to be de­ from Bank. These three banks hold 70.9 percent of the clared by Bank and tax benefits to be derived from market’s commercial bank deposits and have been af­ filing consolidated tax returns. Bank is presently in filiated through common ownership and interlocking generally satisfactory condition, but Applicant’s pro­ directors and officers for over 20 years. jections for the future earnings performance of Bank Under section 3(c) of the Bank Holding Company appear unduly optimistic when compared to its past Act, the Board is precluded from approving any pro­ record. Moreover, Applicant’s projections of Bank’s posed acquisition of a bank that, in any part of the future asset growth, and therefore of its future need country, (1) would result in a monopoly, or would be for capital, appear unreasonably low in light of Bank’s in furtherance of any combination or conspiracy to past asset growth. On the basis of more conser­ monopolize or attempt to monopolize the business of vative earnings and growth projections it appears banking; or that (2) may substantially lessen com­ that Applicant’s income would not provide Applicant petition or tend to create a monopoly or be in restraint sufficient financial flexibility to service its debt without of trade in any banking market, unless the Board finds adversely affecting the long-term capital position of that such anticompetitive effects are clearly out­ Bank, or to meet any unexpected problems that might weighed by the convenience and needs of the commu­ arise at Bank. Therefore, the Board concludes that nity to be served. considerations relating to financial resources and fu­ As part of its analysis of the competitive effects of a ture prospects weigh against approval of this appli­ proposal involving the restructuring of a bank’s own­ cation. Bank’s management is regarded as being gen­ ership into corporate form, the Board takes into con­ erally satisfactory, but this factor lends no weight sideration the competitive effects of the transaction toward approval of the application. whereby common share ownership and/or an inter­ No significant changes in Bank’s operations or in the locking director/officer relationship were established services offered to Bank’s customers are anticipated to between the subject bank and one or more of the other follow from consummation of the proposed acquisi­ banks in the same market.3 The Board finds that the tion. Consequently, in view of the adverse competitive effect of affiliation of Bank, Campbell Bank, and Ber­ effects associated with this proposal, considerations nie Bank was to eliminate significant competition that relating to the convenience and needs of the commu­ existed prior to affiliation, increase the concentration nity to be served lend weight toward denial of this ap­ of banking resources within the Malden banking mar­ plication. ket, and eliminate two independent banking com­ On the basis of the circumstances concerning this petitors in the market. Although this relationship is application, the Board concludes that the competitive and financial considerations involved in this proposal represent adverse factors lending weight toward denial of the proposal. Such adverse factors are not out­ 2. The Malden banking market is in the southeastern quadrant of weighed by any additional benefits to the convenience Missouri and is approximated by the southern one-third of Stoddard County, the northern one-third of Dunklin County, and the western and needs of the community. Accordingly, it is the portion of New Madrid County, all in Missouri. Board’s judgment that approval of the application 3. Mahaska Investment Company, 63 Federal Reserve Bulle­ would not be in the public interest and that the appli­ tin 579 (1977); Citizens Bancorp, Inc., 63 Federal Reserve Bulle­ tin 1083 (1977). cation should be denied. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 511 On the basis of the facts of record, the application is have been determined by the Board to be closely re­ denied for the reasons summarized above. lated to banking (12 C.F.R. § 225.4(a)(8)). By order of the Board of Governors, effective In July 1974, BankAmerica published notice in the May 12, 1980. Newark Star Ledger, pursuant to the provisions of Section 225.4(b)(1) of Regulation Y, of its proposal to Voting for this action: Chairman Volcker and Governors engage de novo in data processing services at an office Schultz, Partee, Teeters, and Rice. Absent and not voting: in Piscataway Township, New Jersey. On October 14, Governor Wallich. 1974, the Reserve Bank approved the proposal pur­ suant to delegated authority. In 1976, the Board ad­ (Signed) Griffith L. Garwood, vised BankAmerica that the approval limited Decimus [seal] Deputy Secretary of the Board. to offering services from the Piscataway office to cus­ tomers located only within the area where the Star Ledger could be considered to be a newspaper of gen­ Orders Under Section 4 of Bank Holding eral circulation. Accordingly, the approval enabled Company Act BankAmerica to engage in data processing activities in northern New Jersey, and BankAmerica currently of­ BankAmerica Corporation, fers such services in that area.2 San Francisco, California Subsequently, BankAmerica published notice, in September 1976, in nine large Eastern newspapers3 of Order Approving Geographic Expansion of Decimus its proposal to offer data processing services de novo Corporation within a 500-mile radius of Decimus’ Piscataway of­ fice. Protests to this expansion proposal were filed by BankAmerica Corporation (“BankAmerica”), San National Computer Analysts, Inc. (“NCA”), Prince­ Francisco, California, a bank holding company within ton, New Jersey, Delmarva Bank Data Processing the meaning of the Bank Holding Company Act, sub­ Center, Inc. (“Delmarva”), Denton, Maryland, and mitted to the Federal Reserve Bank of San Francisco Datatel, Inc. (“Datatel”), Alexandria, Virginia (col­ (“Reserve Bank”), pursuant to section 4(c)(8) of the lectively referred to as “Protestants”).4 Protestants Bank Holding Company Act of 1956, as amended (12 requested a hearing on the proposal. U.S.C. § 1843(c)(8)) (the “Act”), and Part 225.4(b)(1) On May 20, 1977, the Board issued and published an of the Board’s Regulation Y (12 C.F.R. § 225.4(b)(1)), Order requiring a public formal administrative hearing a proposal to expand geographically the data process­ on BankAmerica’s proposal (42 Federal Register ing activities of BankAmerica’s data processing sub­ 27,293 (1977)). BankAmerica sought judicial review of sidiary, Decimus Corporation (“Decimus”), San the Order in the United States Court of Appeals for the Francisco, California. The market to be serviced Ninth Circuit.5 On May 14, 1979, the Court of Appeals would be within a 500-mile radius of Piscataway, New affirmed the Board’s Order.6 The Board then repub­ Jersey and a sixteen-state area1 encompassing Federal lished the Order for a formal public hearing (44 Federal Reserve Districts 1 through 5, except for the state of Register 51,863 (1979)).7 Ohio. BankAmerica proposes, through Decimus, to en­ 2. BankAmerica had also obtained authority to service the Jef­ gage in the activities of storing and processing bank­ ferson Bank, Haverford, Pennsylvania, through a similarly non-proing, financial and related economic data, including de­ tested publication and on July 30, 1979, the Board approved Bank­ America’s request to continue such processing pending the outcome posit accounting, general ledger accounting, account of this proceeding. reconciliation, loan accounting and credit union ac­ 3. Notice was published in The Washington Post, The New York Times, Boston Herald-American, Philadelphia Evening Bulletin, The counting, and providing payroll, accounts receivable Richmond Times-Dispatch, Buffalo Courier Express, Baltimore News and payable, billing and similar data processing serv­ American, The Pittsburgh Press and the eastern edition of The Wall ices. These services are proposed to be offered to cus­ Street Journal. 4. Bankputer, Inc., New Haven, Conn.; On-Line Service Corp., tomers that include commercial banks, savings and Philadelphia, Pa.; Consolidated Computer Company, Newark, Ohio; loan associations, savings banks, credit unions, mort­ Virginia Data Center, Norfolk, Va.; National Association of Bank gage service companies and non-financial institutions Servicers, Columbus, Ohio; and System Development Corporation, Santa Monica, California, also submitted objections to the proposal, such as retailers who extend credit. Such activities but have not pursued their objections. 5. BankAmerica claimed that the Board had not acted on the pro­ posal within ninety-one days after the Board received the complete 1. The states to be serviced are Maine, New Hampshire, Vermont, record on the proposal and that the proposal had been approved by Massachusetts, Rhode Island, Connecticut, New York, Pennsylvania, operation of law, in accordance with section 4(c) of the Act. New Jersey, Delaware, Maryland, Virginia, West Virginia, North 6. BankAmerica Corporation v. Board of Governors of the Federal Carolina, South Carolina and the District of Columbia. Reserve System, 596 F.2d 1368 (9th Cir. 1979). *Copies of the Administrative Law Judge’s Recommended Decision 7. The National Association of Bank Servicers (“NABS”), whose in this matter will be furnished upon request. membership consists of 48 computer centers providing nationwide Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

512 Federal Reserve Bulletin □ June 1980 The Board’s hearing Order directed that a public such conditions are unwarranted. Accordingly, the hearing be held with respect to whether the proposal of Board now states its findings as to the facts and its BankAmerica to expand the data processing opera­ conclusions drawn therefrom, and issues its Order. tions of its subsidiary, Decimus, into the proposed THE PROPOSAL market areas could reasonably be expected to produce benefits to the public, such as greater convenience, in­ BankAmerica is the largest banking organization in the creased competition, or gains in efficiency, that out­ United States and controls Bank of America, N.T. & weigh possible adverse effects, such as undue concen­ S.A., San Francisco, California, which holds deposits tration of resources, decreased or unfair competition, of approximately $85 billion.8 BankAmerica owns sub­ conflicts of interests, or unsound banking practices. stantially all of the shares of Decimus, which was A public formal hearing, in accordance with the formed in 1969 for the purpose of offering computer Board’s Rules of Practice for Hearings (12 C.F.R. § and data processing services by first engaging in com­ 263), was held on October 10, 12, 15, 16 and 17, 1979, puter leasing operations nationwide and then engaging in Philadelphia, Pennsylvania, and in Washington, in the activity of offering data processing services. In D.C., on November 13, 14, and 15, 1979, before an 1970, Decimus began offering data processing services Administrative Law Judge appointed by the Board. A de novo in California. Pursuant to the 1974 Board ap­ substantial record on the application was developed proval, Decimus’ data processing center in Piscatathrough extended discovery proceedings conducted way, New Jersey, offers a wide range of data proc­ under the authorization of the Administrative Law essing services to banks in northern New Jersey. Judge, and through the participation of Decimus, Decimus proposes to expand the area in which the NCA, Delmarva, Datatel, BankAmerica and Board Piscataway office offers its activities to a sixteen-state Counsel, and the submission of numerous exhibits. area within a 500-mile radius of its office in Piscata­ In a Recommended Decision dated January 23, way; Decimus proposes to focus its major marketing 1980, the Administrative Law Judge concluded that effort within a 100- to 150-mile radius of Piscataway on consummation of the proposed expansion of Decimus “batch” processed customers and its major marketing would result in “benefits to the public [that] do in fact effort beyond that area on “remote” processed cus­ outweigh the possible adverse effects.” Accordingly, tomers. the Administrative Law Judge recommended that the In batch processing, typically the information to be Board of Governors approve the application. processed is physically delivered to the servicer for Having considered the entire record of the hearing, processing at the end of a business day and the proc­ including the transcript, exhibits, rulings and briefs essed information is delivered to the customer the fol­ filed in connection with the hearing, and the Recom­ lowing morning. In remote processing, the information mended Decision filed by the Administrative Law to be processed is transmitted between the servicer Judge, together with Bank America’s, NCA’s, and Del­ and the customer through telephone lines or other marva’ s Exceptions thereto, the Board has determined forms of electronic communications. Batch processing that the Administrative Law Judge’s findings of fact can reasonably be offered only in a limited geographic and conclusions, as modified and supplemented here­ area (normally within 100 to 150 miles from the data in, are fully supported by the evidence of record and center) because the ability to service a customer in a should be adopted as the findings and conclusions of timely and cost effective fashion is determined by the the Board. The Board adopts the Administrative Law distance of the customer from the data center. The Judge’s conclusion that “benefits to the public do in geographic area in which remote item processing can fact outweigh the possible adverse effects.” However, reasonably be offered is more extensive and depends the Administrative Law Judge recommended that cer­ upon suitable equipment and costs of transmission. tain conditions be imposed on the Board’s approval. In the course of the hearing, there was testimony The Board has not adopted all of these conditions and that if the proposal were approved, Decimus would al­ will explain the reasons why in the Board’s judgment so use “satellite batch processing” in providing its data processing services to remote customers. Under this method, the material to be processed is physically service to 2,000 banks, further received notice of the hearing through delivered by courier to a servicer’s satellite office that the newspaper notices; through a presentation by the President of NCA at an NABS convention in New Orleans in February of 1976; by has facilities for remote transmission of data. The sat­ letter of August 13, 1979, from the Assistant General Counsel of the ellite office electronically transmits material to the data Board; and finally through service on July 23, 1979, of the Notice of center for processing and receives processed material Prehearing Conference. NABS appeared at the prehearing conference on August 2, 1979, as an observer, but indicated that it did not desire from the data center. The satellite office prints the proc­ to participate as a protestant in the proceeding. An article in the Jour­ essed data and delivers the material by courier to the nal of Commerce on August 20, 1979, which described the application and the hearing to be held, also provided notice to the data processing community. 8. All banking data are as of December 31, 1979. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 513 customers. In effect, this method would enable De- The notice required under Regulation Y calls for a cimus to provide batch services, beyond its normal description of the activities to be engaged in, the lo­ 100- to 150-mile limit, to any point in the application cations at which the activities are to be conducted,14 area through a computer-equipped satellite. and the areas to be served under the proposal. How­ ever, the Board does not generally require that the Findings and Conclusions bank holding company specify the methods by which the services would be offered. A. Notice of the Application and Hearing As discussed above, in the course of the hearings it became evident that Decimus intended to supply The Board’s Regulation Y (12 C.F.R. § 225.4(b)(1)) data processing services by means of a “satellite provides that a bank holding company may engage batch system.” The record shows that the notice of de novo in activities that have been determined by the proposal published by BankAmerica clearly the Board to be closely related to banking (and thus stated that its subsidiary Decimus proposed to offer permissible for bank holding companies), but only data processing services within 500 miles of its exist­ after publishing the required notice of its proposal. ing data processing center in Piscataway, New Jer­ In 1971, the Board determined that the activity in­ sey, a sixteen-state area. The notice was not re­ volved here (data processing of financial data) is quired to, and did not, specify all the methods by closely related to banking and thus permissible for a which services would be offered. The evidence at bank holding company. Protestants do not attack the hearing demonstrates that satellite batching is the closely relatedness of the activity involved in the one of several methods of engaging in the data pro­ Decimus proposal.9 cessing activity. Accordingly, the Board concludes The record shows that, in 1976, when BankAmer- that proposed remote data processing services by ica proposed to expand the geographic scope of means of satellite batching are covered by Bank­ Decimus’ data processing service, BankAmerica pub­ America’s notice of its proposal. On this point, the lished notice of its proposal in nine newspapers of Board disagrees with the Administrative Law general circulation located throughout the sixteen- Judge’s conclusion that approval of satellite batch state application area, At that time, Regulation Y services should not be granted without publishing provided that notice of a proposal to engage de novo notice of this method of delivering data processing in nonbanking activities should be “published . . . services. Apparently the Administative Law Judge’s in a newspaper of general circulation in the com­ conclusion is premised on a misinterpretation of the munities to be served.” (12 C.F.R. § 225.4(b)(1)).10 Board’s regulations. His recommendation on this The Board finds that notice of the proposal was point would add a requirement that is not provided legally sufficient under the regulations of the Board in the Board’s regulations. in effect at that time.11 The record also shows that In the Board’s judgment, potential competitors Protestants had actual and timely notice of the pro­ were reasonably put on notice that Decimus might posed expansion of Decimus’ operations12 and par­ utilize any technologically feasible method of pro­ ticipated fully in the proceedings on the proposal. viding the designated services. Moreover, there is The Administrative Law Judge found that there was no evidence in the record that the method of provid­ no merit in Protestants’ claim of inadequate notice ing data processing services whether batch, remote as to Protestants and other potential competitors of or satellite batch, is germane to any of the sub­ Decimus.13 The Board adopts this finding as one stantive issues raised in connection with these pro­ that is supported by the record. ceedings. There is nothing in the record to indicate that the absence of a reference to satellite batch services in the notice of the proposal in this case has 9. No Protestant to the application has claimed that Decimus’ pro­ posed activities are not closely related to banking. worked any prejudice to any potential competitor.15 10. Effective January 1, 1979, as to applications accepted by any Of course, if Decimus proposes to provide such Federal Reserve Bank on or after that date, section 225.4(b)(1) of the services to customers located outside of the area Board’s Regulation Y (12 C.F.R. § 225.4(b)(1)) was amended to re­ quire Federal Register notice in lieu of newspaper notice of de novo proposals filed pursuant to section 4(c)(8) of the Act. 11. The notice requirements, both before and after amendment, call 14. Under section 225.4(c) of Regulation Y (12 C.F.R. § 225.4(c)), for the applicant to identify the offices at which the activities will be the activity may not be “provided at any location other than those conducted. In addition, the applicant must now specify the geographic described in the notice published” by the bank holding company. If area to be served. 43 Federal Register 60,261 (1978). the bank holding company wishes to provide the activity at a location 12. Protestants assert that efforts by others than BankAmerica to different from that specified in the notice, a new notice and new ap­ make the data processing community aware of the hearing should not proval would be required (12 C.F.R. § 225.123(d)). be considered in determining whether BankAmerica has met its bur­ 15. Thus, no potential competitor has claimed, nor can reasonably den of providing adequate notice of this proceeding. claim, that it failed to intervene in the proceeding because it believed, 13. The record shows that BankAmerica’s proposal received con­ on the basis of the notice, that only certain technology would be uti­ siderable publicity within the data processing industry. lized. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

514 Federal Reserve Bulletin □ June 1980 designated in the notices, a separate notice of pro­ evidence to the contrary, the Board views de posed activities for that area would be required. novo entry as pro-competitive and a positive pub­ Accordingly, approval of the proposal herein in­ lic benefit since such entry provides an additional cludes approval for provision of the data processing source of competition in a market.19 In section services on a remote or batch basis, or a combina­ 4(c)(8), Congress authorized the Board to dif­ tion of these two methods, and would not be limited ferentiate between activities commenced de novo to any particular method for providing the approved and activities commenced through acquisition of a services to institutions within the designated geo­ going concern because Congress viewed de novo graphic area. entry as having beneficial effects on com­ Under a contrary interpretation, a new notice of petition.20 The Board’s regulation Y implement­ proposed activity would be required whenever there ing section 4(c)(8) of the Act established expedit­ is a change in the technology by which an approved ed procedures for the processing of applications activity is offered, even though there is no change in to engage de novo in approved activities and is the nature of the activity or in the geographic market based on economic theory, Congressional instruc­ already approved by the Board. This result could in­ tion, and the Board’s experience in administering hibit the introduction of new methods of providing the Act that de novo entry is generally pro-com­ services and would, therefore, be adverse to the petitive. public interest. The Administrative Law Judge found that entry of Decimus into the application area would add a B. The Balance of Public Benefits Over Possible well-equipped and well-financed competitor Adverse Effects ready, willing and able to provide an optimum data processing service to the banking industry; Under section 4(c)(8) of the Act,16 in order to ap­ that this service is of particular value to small prove a proposal by a bank holding company to en­ banks; and that the result should be greater con­ gage in activities that the Board has determined to venience and lower costs to banks and some mea­ be “closely related to banking,”17 the Board must surable gains in the efficiency of small bank opera­ next determine whether the performance of the pro­ tions. The record supports these findings of the posed activity “can reasonably be expected to pro­ Administrative Law Judge. The Board adopts duce benefits to the public, such as greater conve­ these findings. nience, increased competition, or gains in efficiency, that outweigh possible adverse effects 2. POSSIBLE ADVERSE EFFECTS ARE such as undue concentration of resources, de­ OUTWEIGHED creased or unfair competition, conflicts of interests, or unsound banking practices.” This balancing test With respect to the balancing test that the Board necessitates a positive showing of public benefits must apply in judging section 4(c)(8) proposals, outweighing possible adverse effects of any proposal the statute directs the Board to determine whether before the Board will approve an application.18 the proposed activity “can reasonably be ex­ Based on the evidence of record, the Administra­ pected to produce public benefits . . . that out­ tive Law Judge found that the benefits to the public weigh possible adverse effects.” (emphasis add­ from the proposal in fact outweigh the possible ad­ ed). The statute thus commands the Board to verse effects. The Board concurs in and adopts that assess, in its analysis of a proposal, only those ef­ finding. fects that, based on the record, are reasonably 1. PUBLIC BENEFITS FAVOR APPROVAL 19. Citicorp (Person to Person), 65 Federal Reserve Bulletin 507 (1979); U.N. Bancshares, Inc., 59 Federal Reserve Bulletin Decimus proposes to engage de novo in offering 204, 206 (1973). 20. In connection with its consideration of the 1970 Amendments to financially related data processing services in the the Act, Congress emphasized the importance of encouraging de novo expanded geographic market. In the absence of entry: Where a bank holding company enters a market through acquisition of 16. 12 U.S.C. § 1843(c)(8). a major going concern, it may not have the incentive to compete vigor­ 17. No protestant to the application has claimed that Decimus’ pro­ ously, thereby bringing the possible benefits into play, as it would im­ posed activities are not closely related to banking. mediately succeed to what it might consider its fair share of the mar­ 18. This test is not a “public convenience and necessity” test as ket. On the other hand, where a bank holding company enters a new used in regulating the airline and trucking industries. The Administra­ market de novo or through acquisition of a small firm as opposed to tive Law Judge correctly noted that (contrary to the suggestion of acquisition of a substantial competitor, its desire to succeed in its new some of Protestants) there is no requirement that Decimus show a endeavor is more likely to be competitive. The legislation specifically “need” for its service within the application area, but only that its emphasizes the importance of the manner in which a bank holding services would result in a reasonable expectation of increased benefits company may enter new activities. H Rep. No. 91-1747, 91st Cong. 2d to the public that would outweigh possible adverse effects. Sess., 17-18 (1970), 1970 U.S. Code and Cong. & Adm. News 5568. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 515 likely to occur. The Board is not required to en­ tion 4(c)(8) of the Act and, in any event, pro­ sure against every potential adverse contingency vides negligible, if any, weight against approv­ that might be hypothesized in conneciton with a al and is outweighed by the pro-competitive proposal.21 Section 4(c)(8) of the Act enumerates, effect of the de novo expansion. In addition, the as possible adverse effects of an acquisition by a Board notes that relevant statutes provide it bank holding company, undue concentration of with a wide variety of supervisory tools to re­ resources, decreased or unfair competition, con­ strain violations of law, unsound banking prac­ flicts of interests, and unsound banking practices. tices, conflicts of interest or other adverse ef­ The Administrative Law Judge found that any fects that might result after a bank holding possible adverse effects were outweighed by pub­ company has received approval to engage in lic benefits. The Board reaches the same con­ nonbanking activities.24 clusion. b. Competition. As demonstrated earlier, de a. Concentration of Resources. With respect novo entry is normally pro-competitive. On the to a potential undue concentration of resources record in this case, the Board finds that con­ resulting from a proposal under section 4(c)(8), summation of the proposal may reasonably be the Board notes that it has generally found this expected to increase, not decrease, com­ kind of adverse effect in connection with a pro­ petition. posal by a large banking organization to acquire The Administrative Law Judge considered a going concern of substantial size.22 In the the possibility that Decimus’ entry into an ex­ Board’s view, the de novo geographic expan­ panded geographic market might cause the sion of services, as in the current proposal, in­ elimination of one or more of its competitors.25 volves no gain of economic resources and no While recognizing that a competitor “cannot acquisition of any established market position rely on Federal regulation to restrain its com­ or any customers. As the Board has often petitors while it fails ... to develop its own po­ stated, when entry is on “a de novo basis, the tential,” the Administrative Law Judge never­ proposed transaciton would neither eliminate theless concluded that approval of this proposal existing or potential competition nor cause an “may result in some decreased competition.” increase in the concentration of resources in In the Board’s view, the elimination of an in­ any relevant area.”23 efficient competitor as a result of the com­ The Administrative Law Judge found no evi­ petition afforded by a new entrant into the mar­ dence in Decimus’ current operations of undue ket is not decreased competition within the concentration of resources or any attempt to meaning of section 4(c)(8). The U.S. Supreme achieve an undue concentraiton of resources or Court has instructed, as the Administrative any reasonable likelihood of such undue con­ Law Judge noted, that the antitrust laws are de­ centration of resources. The Board adopts signed to protect competition, not com­ these findings. However, the Administrative petitors.26 Accordingly, the Board finds that Law Judge stated that the connection between consummation of this proposal is not reason­ BankAmerica and Decimus provides Decimus ably likely to result in decreased competition. with a considerable advantage over its com­ petitors and that Decimus’ operations represent c. Soundness of Practices and Fairness of “a concentration of resources which might be­ Competition. There is no evidence in the record come ‘undue’ if the [BankAmerica]/Decimus management decided to mount an all-out effort 24. See sections 4(a)(2) and 5(b) of the Act (12 U.S.C. §§ 1843(a)(2) to saturate the application area with data pro­ and 1844(b)) and section 8(b)(1), (3) of the Financial Institutions Su­ cessing services.” (emphasis added). It is the pervisory Act (12 U.S.C. § 1818(b)). 25. The Administrative Law Judge found that two of Protestants, Board’s judgment that such a speculative possi­ Datatel and Delmarva, were both strong organizations that could com­ bility, unsupported by any facts of record, is pete successfully with Decimus if it expanded its operations in accord­ not an adverse effect within the meaning of sec- ance with its proposal, but that the third Protestant, NCA, is a rela­ tively weaker competitor. In its Exceptions to the Recommended Decision, NCA asserted it will not be seriously harmed by the geo­ 21. Connecticut Bankers Association v. Board of Governors, No. graphic expansion of Decimus and, to the contrary, that approval of 79-1554 (D.C. Cir., Feb. 7, 1980) slip op. at 18-19. the proposal might divert Decimus from NCA’s principal area of oper­ 22. See, e.g., Crocker National Corporation (Bishop Investment ations. NCA claims that its chief concern is unfair competitive con­ Company), 66 Federal Reserve Bulletin 66 (1980); Security Pacific duct resulting from Decimus’ prices being “below cost.” This is con­ Corporation (American Finance System), 65 Federal Reserve Bul­ sidered on pages 21-23 of this Order. letin 73 (1979). 26. See Brown Shoe Company v. United States, 370 U.S. 294, 344 23. See, e.g., Hawaii Bancorporation, Inc., 63 Federal Reserve (1962); see also United States v. Von’s Grocery Co., 384 U.S. 270, 282 Bulletin 163 (1977) (emphasis added). (1966) (Stewart, J., dissenting). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

516 Federal Reserve Bulletin □ June 1980 of conflicts of interest. The Administrative Law an inference. The bare possibility of unfair Judge so found and the Board adopts this find­ hiring of competitors’ employees, unsup­ ing. ported by any evidence, does not warrant de­ The Administrative Law Judge found no evi­ nial of the proposal nor a conditional approv­ dence in the record of unsound banking prac­ al. While the Board clearly may condition tices. The Board agrees and adopts this finding. approval of a proposal under section 4(c)(8), The Administrative Law Judge found and the conditions on approval generally are imposed record shows that Decimus operates independ­ only to remedy adverse circumstances that ently of BankAmerica, receives no financial op­ exist or are likely to exist. Nevertheless, the erating subsidy nor technological help from the Administrative Law Judge recommended parent bank holding company. The record that the proposal be approved on condition shows that while Decimus has borrowed from that Decimus not attempt to employ the serv­ BankAmerica on three occasions, Decimus has ices of anyone then in the employ of a direct received no preferential treatment, has paid in­ independent competitor.29 The Board be­ terest at the rate of two percent above the prime lieves that such a condition is neither neces­ rate and has borrowed only a fraction of its line sary nor appropriate. Moreover, the Board of credit. Decimus operates at an overall profit, has the authority and the ability to take action and maintains separate audit, insurance, comp­ against a bank holding company to restrain troller, research and development, marketing any unfair practices that might arise. In addi­ support, corporate data processing and person­ tion, civil remedies may be available in such nel departments.27 cases. Accordingly, the Board imposes no The Recommended Decision also discusses condition relating to the hiring of employees. the fairness of employment practices of Deci­ mus, its below-cost pricing of data processing 2. Below-Cost Pricing. The Administrative services, and the use of BankAmerica’s finan­ Law Judge found that, while the record cial statements to market Decimus’ data serv­ discloses that Decimus has not raised its ices. prices for data processing services in New Jersey since January 1975 and that its prices 1. Employment Practices. The Administra­ are below its actual cost, “Decimus’ price tive Law Judge found, on the basis of the levels have not been substantially lower than record, and the Board adopts this finding, those of its competitors in this proceeding that Decimus did not unfairly attempt to “pi­ and, therefore, cannot be considered to be rate” a key employee from a competitor, but predatory.” The Administrative Law Judge that Decimus had retained the new employee did not find that predatory pricing could rea­ through an employment agency that was not sonably be expected if Decimus were permit­ aware of the employee’s existing relationship ted to expand its services geographically. As with the competitor.28 The Administrative the Administrative Law Judge found, the rec­ Law Judge found no merit in Protestants’ ord provides no basis for concluding that pos­ claim of unfair competitive practices in em­ sible predatory pricing warrants denial of this ployment. The Board agrees. The Adminis­ application. In the Board’s judgment the rec­ trative Law Judge’s findings do not suggest ord amply supports the finding that Decimus that unfair “pirating” of competitors’ em­ has not engaged in unfair predatory pricing. ployees is reasonably likely to result from the The Board adopts this finding. The record in­ proposal, and indeed appear to negate such dicates that Decimus’ losses on data process­ ing services may to some extent be attribut­ 27. In its Exceptions to the Recommended Decision, NCA con­ able to restrictions generated by the tends that the Administrative Law Judge’s conclusion regarding un­ proceeding herein (i.e. Decimus’ being un­ sound banking practices “is, perhaps, the most erroneous of all.” NCA argues that the evidence of record shows that Decimus’ data able to utilize equipment and personnel de­ processing operations have operated at a substantial loss, and “that it signed for an expansion that has not been al­ is an ‘unsound banking practice’ for a bank holding company to permit a nonbanking subsidiary, or any logically divestible division thereof, lowed to take place). In view of this fact, the to incur losses in excess of $1 million year after year, without any fact that the evidence of record indicates reasonable prospect of breaking even.” The record shows that Deci­ Decimus’ other data processing centers in mus has not constituted a financial drain of BankAmerica or its subsid­ iary bank, and that the ownership and expansion of Decimus’ activi­ ties are not likely to result in an unsound banking practice. 29. The employment of a person who has been a competitor’s em­ 28. NCA had charged that Decimus engaged in unfair competition ployee does not in itself constitute unfair competition. See U.N. Banc­ by hiring away from NCA one of its marketing representatives shortly shares, Inc., 59 Federal Reserve Bulletin 204, 205 (1973), and before NCA was to participate in a banking convention. cases cited therein. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 517 California have become increasingly profit­ well as BankAmerica’s 10-K Report filed able and its Chicago data center has been ex­ with the Securities and Exchange Commis­ periencing smaller losses and should be prof­ sion. Accordingly, the Board finds unneces­ itable in the near future, the fact that sary and unwarranted and does not adopt the BankAmerica fully intends its Piscataway of­ Administrative Law Judge’s recommenda­ fice to operate at a profit, and the fact that a tion regarding the filing with the Board of De­ new operation often encounters losses for the cimus’ internal financial reports. first few years, the Board concludes that Dec­ The Administrative Law Judge also recom­ imus ’ below cost pricing does not warrant ei­ mended that the Board require Decimus to ther denial or a conditioned approval of this cease and desist from using balance sheets proposal. and profit and loss statements of Bank­ The Administrative Law Judge recom­ America to persuade customers to use Deci­ mended that BankAmerica be required to file mus services. The evidence in the record in­ with the Board, and to keep current, its dicates that Decimus would provide Decimus charges for services so that its competitors financial information whenever it was re­ can readily determine whether Decimus has quested, but on other occasions the Bank­ adopted a policy of predatory price com­ America annual report would be provided, petition. The Board is of the view that condi­ without the Decimus financial statements, to tioning approval of the proposal on Decimus’ potential customers. The Board is concerned maintaining a public file of its current prices that distribution of financial data of Bank­ is neither necessary nor appropriate. Section America might be misleading to some cus­ 4(c)(8) does not require the Board to deny ap­ tomers or might give Decimus an advantage proval or condition approval to ensure not shared by competitors not affiliated with a against conduct that is possible but has not banking organization, by creating the impres­ occurred and is not reasonably expected to sion that Decimus, as a holding company af­ occur. As noted above, the Board has contin­ filiate, has easier access to financing than its uing authority to correct unfair or unsound independent competitors. Accordingly, the practices by a bank holding company, if any Board believes the proposal should be ap­ were to occur. proved on the condition that Decimus be re­ The Board also believes that the filing of quired to provide its own financial statements prices by Decimus could have a serious anti­ to any potential new or renewal customer re­ competitive effect, both by divulging Deci­ questing financial data and be forbidden to mus’ confidential pricing information to its provide BankAmerica’s consolidated or parcompetitors and by facilitating price-fixing ent-only financial statements unless such data among competitors. are specifically solicited by the customer. Accordingly, because the Board finds that Such a condition would serve the purpose of the Administrative Law Judge’s findings and ensuring that potential customers are pro­ conclusions with respect to below-cost pric­ vided with Decimus’ financial statements, ing do not require that the approval be condi­ while at the same time providing them access tioned, and because the condition itself could to BankAmerica’s financial statements, if have an anti-competitive effect, the Board they so desire. does not adopt the Administrative Law Judge’s recommended condition that Deci­ d. Time Limit on Approval. The Administra­ mus be required to file its charges for services tive Law Judge also recommended that Deci­ with the Board. mus’ authority to operate in the application area should be limited to five years, after which 3. Use of BankAmerica s Financial State­ BankAmerica would be required to reapply to ments. The Administrative Law Judge fur­ the Board in order to renew its operating au­ ther recommended that, to guard against un­ thority. The Administrative Law Judge’s rec­ fair competition, Decimus be required to file ommendation was advanced to ensure that Dec­ with the Board Decimus’ balance sheets and imus will continue to refrain from engaging in profits and loss statements as distinguished unfair competitive practices during the approv­ from those of BankAmerica. al period. The Board believes that such a condi­ Decimus’ balance sheets and its profit and tion is not justified on the record. loss statements are already available in ade­ The findings of the Administrative Law Judge quate detail in the Board’s Form F.R. Y-6 as as to the facts show that Decimus has not en- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

518 Federal Reserve Bulletin □ June 1980 gaged in any anticompetitive or unfair prac­ nancial statements only when they are specifically tices; the Board adopts these findings. The find­ requested by the customer. ings do not suggest any reasonable basis for This determination is also subject to the conditions concluding that Decimus is likely to engage in set forth in section 225.4(c) of Regulation Y and to the such practices in the future. In addition, the Board’s authority to require such modification or ter­ Board notes that the temporary approval might mination of the activities of a holding company or any impair Decimus’ ability to compete effectively of its subsidiaries as the Board finds necessary to as­ in light of the fact that its competitors would not sure compliance with the provisions and purposes of be limited to a temporary operation. the Act and the Board’s regulations and orders issued In sum, the Board concludes that consum­ thereunder, or to prevent evasion thereof. The trans­ mation of this proposal as approved herein can­ action shall be made not later than three months after not reasonably be expected to produce any un­ the effective date of this Order, unless such period is due concentration of resources, decreased or extended for good cause by the Board or by the Feder­ unfair competition, conflicts of interests, un­ al Reserve Bank of San Francisco, pursuant to dele­ sound banking practices or other adverse ef­ gated authority. fects and that, in any event, public benefits can By order of the Board of Governors, effective May reasonably be expected that outweigh any pos­ 15, 1980. sible adverse effects of this proposal. Voting for this action: Vice Chairman Schultz and Gover­ nors Partee, Teeters, and Rice. Present and not voting: Gov­ Oral Argument ernor Wallich. Absent and not voting: Chairman Volcker. In their Exceptions to the Recommended Decision, (Signed) Griffith L. Garwood, NCA and Delmarva requested oral argument before [seal] Deputy Secretary of the Board. the Board under section 263.14 of the Board’s Rules of Practice for Hearings (12 C.F.R. § 263.14). Their Lloyds Bank Limited, request does not show that any purpose would be London, England served by allowing oral argument, and is opposed by the other Protestant, Datatel, as well as by Bank­ The Royal Bank of Scotland Group Limited, America. The Board believes that no useful purpose Edinburgh, Scotland would be served by granting oral argument before the Board. NCA’s and Delmarva’s request is hereby de­ The Royal Bank of Scotland Limited, nied. Edinburgh, Scotland Conclusion Order Approving Acquisition of James Talcott Factors, Inc. On the basis of all the facts of record, the Board con­ cludes that BankAmerica’s geographic expansion of Lloyds Bank Limited (“Lloyds”), London, England, Decimus can reasonably be expected to produce bene­ a bank holding company within the meaning of the fits to the public that outweigh possible adverse ef­ Bank Holding Company Act, The Royal Bank of Scot­ fects. The Board further concludes that no conditions land Group Limited (“Royal Bank Group”), and The should be imposed on the activities of Decimus except Royal Bank of Scotland Limited1 (“Royal Bank”), that Decimus be required to provide its own financial both of Edinburgh, Scotland, have applied for the statements to all potential new or renewal customers Board’s approval under section 4(c)(8) of the Act (12 requesting financial data and be forbidden to provide U.S.C. § 1843(c)(8)) and section 225.4(b)(2) of the BankAmerica’s financial statements unless specifical­ ly requested by a customer to do so. 1. Royal Bank and Royal Bank Group are subject to the nonbanking Based upon the foregoing and other considerations prohibitions of the Act by virtue of 12 U.S.C. § 3106(a), which pro­ vides in general that any foreign bank or company controlling a foreign reflected in the record, the Board has determined that bank that has a branch, agency or commercial lending company in the the balance of public interest factors the Board is re­ United States is subject to certain provisions of the Act in the same quired to consider under section 4(c)(8) is favorable. manner as if it were a bank holding company. Royal Bank has a branch in New York and an agency in San Francisco. Therefore, Roy­ Accordingly, the application is hereby approved, sub­ al Bank and its parent, Royal Bank Group are subject to the Act and ject to the condition that Decimus shall always present must receive the Board’s approval before engaging in the United its own financial statements to potential new or renew­ States in an activity permitted under section 4(c)(8) of the Act. Lloyds, as a registered bank holding company, is also required to seek al customers requesting financial data and shall pre­ Board approval before engaging directly or indirectly in an activity sent BankAmerica’s parent-only or consolidated fi­ permitted under section 4(c)(8). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 519 Board’s Regulation Y (12 C.F.R. § 225.4(b)(2)), to ac­ installment financing, invoice discounting, factoring, quire indirectly through a jointly owned subsidiary, distribution and sale of industrial, agricultural and con­ Lloyds and Scottish Limited (“L&S”), Edinburgh, struction equipment, and the sale and lease of taxi­ Scotland, all of the shares of James Talcott Factors, cabs, electrical goods and furniture. Lloyds directly Inc. (“Factors”), New York, New York. Factors en­ owns approximately 39.2 percent of the shares of L&S gages in factoring and commercial financing activities. and indirectly through its investment in Royal Bank Such activities have been determined by the Board to Group owns about 6.4 percent. Royal Bank directly be closely related to banking (12 C.F.R. § 225.4(a)(1)). owns approximately 39.2 percent of L&S’s shares. Notice of the application, affording opportunity for The remaining 21.6 percent of the shares of L&S are interested persons to submit comments and views on publicly held. L&S currently has no operations in the the public interest factors, has been duly published (45 United States but through its subsidiary, Lloyds and Federal Register 25457). The time for filing comments Scottish International Limited, will form a new com­ and views has expired, and the Board has considered pany, Lloyds and Scottish America, through which the application and all comments received in light of L&S proposes to acquire Factors. the public interest factors set forth in section 4(c)(8) of Factors is a wholly-owned subsidiary of James Tal­ the Act (12 U.S.C. § 1843(c)(8)). cott, Inc., which is wholly-owned by Talcott National Lloyds is the fourth largest banking organization in Corporation. Factors conducts business at offices in the United Kingdom and forty-third largest in the New York and Los Angeles from which it engages world with consolidated assets of $38.8 billion2 and throughout the United States in the activities of factor­ consolidated deposits of $27.6 billion.3 Lloyds engages ing and making business loans secured by accounts re­ in a wide range of banking and related financial serv­ ceivable or inventory of factored clients. It has total ices through more than 2,350 offices in the United assets of $147 million and total receivables of $125.3 Kingdom and indirectly through an extensive system million. During 1979, Factors had a factoring volume of subsidiaries in the United Kingdom and worldwide. of $825 million, representing approximately 3.0 per­ Lloyds owns indirectly a United States subsidiary cent of total commercial factored accounts held by all bank, Lloyds Bank California, San Francisco, Califor­ factoring firms in the United States. Based on these nia, and through its subsidiary, Lloyds Bank Inter­ figures, it is estimated that Factors is the eleventh larg­ national Limited, operates branches in New York and est such firm. As of September 30, 1979, Factors also Chicago and an agency in Miami. Lloyds also owns had outstanding $15.7 million in advances to factored 16.4 percent of the voting shares of Royal Bank clients. Group, and has minority interests in several com­ Neither L&S nor any of Applicants engage in factor­ panies that operate in the United States.4 ing in the United States. Thus, acquisition of Factors Royal Bank Group is a holding company for two would not eliminate any existing competition. More­ United Kingdom banks, Royal Bank and Williams and over, it does not appear that consummation of the Glyn’s Bank Limited (“W&G”), London, England, transaction would eliminate any probable future com­ which rank as the thirteenth and fourteenth largest petition between L&S and Factors. The Board has in banks in the United Kingdom. W&G has no operations the past expressed its view that factoring is a difficult in the United States. Royal Bank operates a branch in field to enter de novo due to the significance of cus­ New York and an agency in San Francisco.5 tomer contacts and of expertise in the client’s indus­ L&S (total worldwide assets of $1.8 billion)6 is a try.7 As a foreign organization, L&S is constrained not holding company and financing vehicle for a number of only by lack of customer contact but by limited experi­ diversified companies. Its principal activities include ence in evaluating credit data concerning United States customers. Thus, it does not appear that L&S or Applicants are likely candidates for de novo entry into the factoring market in the United States. Appli­ cants have indicated that they do not intend to engage 2. Unless otherwise noted, all data are as of December 31, 1979. in factoring in the United States due to the high bar­ 3. As of December 31, 1978. 4. Lloyds has minority interests in: Finance for Industry Limited, riers to entry into the market. However, each has London, England, which owns Triangle Valve Corporation, Inc., a stated that should future entry into the United States distributor of industrial valves throughout the United States; Grindlays Bank Limited which engages in banking in New York; and M&J factoring market appear desirable, the presence of Commercial, Inc., New York, New York, a subsidiary of Grindlays L&S would not deter such entry. To support this as- Bank Limited, which engages in financing exports. These investments are permissible under section 225.4(g) of the Board’s Regulation Y (12 C.F.R. § 225.4(g)). 5. Royal Bank Group also has minority interest in Finance for In­ dustry Limited. This investment is permissible under section 225.4(g) of the Board’s Regulation Y (12 C.F.R. § 225.4(g)). 7. Industrial National Corporation (Ambassador Factors Corpora­ 6. As of September 30, 1979. tion), 58 Federal Reserve Bulletin 171 (1972). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

520 Federal Reserve Bulletin □ June 1980 sertion, Applicants have cited their competition with Voting for this action: Chairman Volcker and Governors each other and with L&S in the United Kingdom and Schultz, Partee, Teeters, and Rice. Absent and not voting: Governor Wallich. in other countries. With respect to commercial financing, it appears that the amount of receivables Factors derives from (Signed) Griffith L. Garwood, this activity in any area is relatively small in relation to [seal] Deputy Secretary of the Board. its total assets. Given the small amount of business de­ rived from commercial financing and the competitive structure of the commercial financing industry, it does not appear that acquisition of Factors would result in Certifications Pursuant to the Bank the elimination of any significant competition. Based Holding Company Tax Act of 1976 on all facts of record, it appears that consummation of the proposal would not have any significant adverse Keystone Consolidated Industries, Inc., effects on competition in any relevant area. Peoria, Illinois In the past, Factors’ parents have encountered some financial difficulties that have hampered the ef­ Final Certification Pursuant to the fectiveness of Factors’ operations. Acquisition of Fac­ Bank Holding Company Tax Act of 1976 tors by L&S should significantly strengthen Factors’ ability to compete in the nationwide factoring market [Docket No. TCR 76-191] and to remain a viable alternative source of factoring and commercial financing services. L&S has also in­ Keystone Consolidated Industries, Inc., Peoria, Illi­ dicated that it intends to expand the activities of Fac­ nois (“Keystone”), has requested a final certification tors into geographic areas in which Factors now has pursuant to section 6158(c)(2) of the Internal Revenue only a limited presence and to expand the types of in­ Code (“Code”), as amended by section 3(a) of the dustries served. On the basis of these and other facts Bank Holding Company Tax Act of 1976 (“Tax Act”), of record the Board concludes that the benefits to the that it has (before the expiration of the period prohibit­ public that would result from the acquisition of Fac­ ed property is permitted under the Bank Holding Com­ tors by L&S, and retention of L&S by Applicants after pany Act (12 U.S.C. § 1842 et seq.) (“BHC Act”) to such acquisition, are sufficient to outweigh any ad­ be held by a bank holding company) ceased to be a verse effects on competition that might result from bank holding company. consummation of the proposal. Moreover, there is no In connection with this request, the following infor­ evidence in the record to indicate that the proposed mation is deemed relevant for purposes of issuing the transaction would lead to any undue concentration of requested certification.1 resources, conflicts of interest, unsound banking prac­ 1. Effective December 5, 1979, the Board issued a tices, or any other adverse effects upon the public in­ prior certification pursuant to section 1101(b) of the terest. Code with respect to the proposed sale by Keystone of Based on the foregoing and other facts of record, the 100,000 shares of Jefferson Trust and Savings Bank of Board has determined that the balance of public inter­ Peoria, Peoria, Illinois (“Bank”), then held by Key­ est factors it must consider under section 4(c)(8) of the stone to two individuals (“Buyers”) for cash. Act is favorable. Accordingly, the applications are 2. The Board’s Order certified that: hereby approved. This determination is subject to the A. Keystone is a qualified bank holding corpora­ conditions set forth in section 225.4(c) of Regulation Y tion within the meaning of section 1103(b) of the Code, and io the Board’s authority to require such modifica­ and satisfies the requirements of that subsection; tion or termination of the activities of a holding compa­ B. the 100,000 shares of Bank that Keystone pro­ ny or a company subject to the provisions of the Act or poses to sell to Buyers are all or part of the property by any of its subsidiaries as the Board finds necessary to reason of which Keystone controls (within the mean­ assure compliance with the provisions and purposes of ing of section 2(a) of the BHC Act) a bank or a bank the Act and the Board’s regulations and orders issued holding company; and under the Act or to prevent evasions of the Act. C. the sale of the shares of Bank is necessary or The transaction shall not be made later than three appropriate to effectuate the policies of the BHC Act. months after the effective date of this Order, unless 3. On December 17, 1979, Keystone sold to Buyers such period is extended for good cause by the Board or its 100,000 shares of Bank. by the Federal Reserve Bank of New York under au­ thority hereby delegated. 1. This information derives from Keystone’s communications with the Board concerning its request for this certification, Keystone’s By order of the Board of Governors, effective May Registration Statement filed with the Board pursuant to the BHC Act, 12, 1980. and other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 521 4. The prior certification issued on December 5, to Gillmor’s stockholders, is necessary or appropriate 1979, was granted on the condition that no person to effectuate the policies of the Bank Holding Compa­ holding an office or position as a director or officer of ny Act (12 U.S.C. § 1841 et seq.) (“BHC Act”). Keystone will hold any such office or position with In connection with this request, the following infor­ Bank, and that Buyers would not be indebted to Key­ mation is deemed relevant, for purposes of issuing the stone. Keystone has represented that all such inter­ requested certification:1 locking relationships between it and Bank were termi­ 1. Gillmor is a corporation organized under the laws nated, effective December 17, 1979, and that Buyers of Ohio on February 6, 1948. On January 3, 1956, Gil­ are not indebted to Keystone. lmor acquired ownership and control of 1,424 shares, 5. Keystone does not directly or indirectly own, representing 41 percent of the outstanding voting control or have power to vote 5 percent or more of any shares, of Bank, and has held all but 25 of such shares class of voting securities of any bank or any company continuously since that date (see footnote 2). that controls a bank. 2. Gillmor became a bank holding company on De­ 6. Keystone has represented that it does not control cember 31, 1970, as a result of the 1970 Amendments in any manner the election of a majority of directors, to the BHC Act, by virtue of its ownership and control or exercise a controlling influence over the manage­ at that time of more than 25 percent of the outstanding ment or policies of Bank or any other bank or any voting shares of Bank, and registered as such with the company that controls a bank. Board on September 13, 1971. Gillmor would have On the basis of the foregoing information it is hereby been a bank holding company on July 7, 1970, if the certified that Keystone has (before the expiration of BHC Act Amendments of 1970 had been in effect on the period prohibited property is permitted under the that date by virtue of its ownership and control on that BHC Act to be held by a bank holding company) date of more than 25 percent of the outstanding voting ceased to be a bank holding company, and has dis­ shares of Bank. Gillmor presently owns and controls posed of all its banking property. 1,498 shares, of the Bank’s total 3,500 shares, repre­ This certification is based upon the representations senting 42.8 percent of such shares.2 made to the Board by Keystone and upon the facts set 3. Gillmor holds property acquired by it on or be­ forth above. In the event the Board should determine fore July 7, 1970, the disposition of which, but for that facts material to this certification are otherwise clause (ii) of section 4(c) of the BHC Act, and the pro­ than as represented by Keystone, or that Keystone viso of section 4(a)(2) of that act, would be necessary has failed to disclose to the Board other material facts, or appropriate to effectuate section 4 of the BHC Act, it may revoke this certification. if Gillmor were to continue to be a bank holding com­ By order of the Board of Governors, acting through pany beyond December 31, 1980, and which property, its General Counsel, pursuant to delegated authority but for such clause and such proviso, would be “pro­ (12 C.F.R. § 265.2(b)(3)), effective May 9, 1980. hibited property” within the meaning of section 1103(c) of the Code. Sections 1103(g) and 1103(h) of (Signed) Griffith L. Garwood, the Code provide that any bank holding company may [seal] Deputy Secretary of the Board. elect, for purposes of Part VIII of subchapter O of Chapter 1 of the Code, to have the determination whether property is “prohibited property,” or is prop­ erty eligible to be distributed without recognition of The Paul M. Gillmor Company, gain under section 1101(b)(1) of the Code, made under Old Fort, Ohio the BHC Act as if that Act did not contain clause (ii) of Prior Certification Pursuant to the Bank Holding Company Tax Act of 1976 1. This information derives from Gillmor’s correspondence with [Docket No. TCR 76-184] the Board concerning its request for this certification, Gillmor’s Regis­ tration Statement filed with the Board pursuant to the BHC Act, and other records of the Board. The Paul M. Gillmor Company, Old Fort, Ohio, 2. Subsequent to July 7, 1970, Gillmor sold 25 shares and later reac­ (“Gillmor”), has requested a prior certification pur­ quired those shares plus 74 shares of Bank. Under section 1101(c)(1) suant to section 1101(b) of the Internal Revenue Code of the Code, property acquired after July 7, 1970, generally does not qualify for the tax benefits of section 1101(b) when distributed by an (“Code”), as amended by section 2(a) of the Bank otherwise qualified bank holding company. Similarly, property sold Holding Company Tax Act of 1976 (“Tax Act”), that before a prior tax certification is granted generally is not eligible for its proposed divestiture of 1,399 shares of the Old Fort tax benefits. Since Gillmor has not claimed that any of the exceptions to these general rules are applicable to it, the 25 shares sold prior to Banking Company, Old Fort, Ohio (“Bank”), pres­ the granting of the tax certification and 74 shares acquired after July 7, ently held by Gillmor, through a pro rata distribution 1970, appear to be ineligible for tax benefits under the Tax Act. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

522 Federal Reserve Bulletin □ June 1980 section 4(c) or the proviso of section 4(a)(2). Gillmor holding company ceased to be a bank holding has represented that it will make such an election.3 company. 4. Gillmor has committed to the Board that no di­ In connection with this request, the following infor­ rector, officer or employee with policy making func­ mation is deemed relevant for the purposes of issuing tions of Gillmor or its subsidiaries (including honorary the requested certification.1 or advisory directors), will hold any such position with 1. Effective December 17, 1979, the Board issued a Bank after consummation of the transaction. prior certification pursuant to section 1101(b) of the On the basis of the foregoing information, it is here­ Code with respect to the proposed divestiture by Pio­ by certified that: neer of 9,000 shares of Pioneer State Bank, Peoria, Illi­ (A) Gillmor is a qualified bank holding corporation nois (“Bank”), then held by Pioneer, through a pro within the meaning of subsection (b) of section 1103 of rata distribution of such shares to Pioneer’s share­ the Code, and satisfies the requirements of that sub­ holders.2 section; 2. The Board’s Order certified that: (B) 1,399 of the shares of Bank that Gillmor pro­ A. Pioneer is a qualified bank holding corporation poses to distribute are all or part of the property by within the meaning of section 1103(b) of the Code, reason of which Gillmor controls (within the meaning and satisfies the requirements of that subsection; of section 2(a) of the BHC Act) a bank or bank holding B. the 9,000 shares of Bank that Pioneer proposes company; and to distribute to its shareholders are all or part of (C) distribution of the shares of Bank to share­ the property by reason of which Pioneer controls holders of Gillmor is necessary or appropriate to ef­ (within the meaning of section 2(a) of the BHC fectuate the policies of the BHC Act. Act) a bank or a bank holding company; and This certification is based upon the representations C. the distribution of such 9,000 shares is neces­ and commitments made to the Board by Gillmor and sary or appropriate to effectuate the policies of upon the facts set forth above. In the event the Board the BHC Act. should hereafter determine that facts material to this 3. On January 18, 1980, Pioneer distributed to its certification are otherwise than as represented by Gill­ shareholders, on a pro rata basis, a total of 9,000 mor or that Gillmor has failed to disclose to the Board shares of Bank and retained 1,500 shares, representing other material facts, it may revoke this certification. 8.8 percent of the outstanding stock of Bank. By order of the Board of Governors, acting through 4. The prior certification issued on December 17, its General Counsel, pursuant to delegated authority 1979, was granted upon the condition that no person (12 C.F.R. § 265.2(b)(3)), effective May 9, 1980. holding an office or position (including an advisory or honorary position) with Pioneer or any of its sub­ (Signed) Griffith L. Garwood, sidiaries as a director, policy-making employee or con­ [seal] Deputy Secretary of the Board. sultant, or who performs, (directly, or through an agent, representative or nominee) functions normally associated with such office of position, will hold any Pioneer Industrial Park, such office or position or perform any such function Peoria, Illinois with Bank or any of its subsidiaries. Effective January 17, 1980, all such interlocking relationships between Final Certification Pursuant to the Pioneer and Bank were terminated. Bank Holding Company Tax Act of 1976 5. Pioneer does not directly or indirectly own, con­ trol or have power to vote 25 percent or more of any [Docket No. TCR 76-185] class of voting securities of any bank or any company that controls a bank. Pioneer Industrial Park, Peoria, Illinois (“Pioneer”), 6. Pioneer has represented that it does not control has requested a final certification pursuant to section in any manner the election of a majority of directors, 1101(e) of the Internal Revenue Code (“Code”), as or exercise a controlling influence over the manage­ amended by section 2(a) of the Bank Holding Compa­ ment or policies of Bank or any other bank or any ny Tax Act of 1976 (“Tax Act”), that it has (before the company that controls a bank. expiration of the period prohibited property is permit­ ted under the Bank Holding Company Act, (12 U.S.C. 1. This information derives from Pioneer’s communications with the Board concerning its request for certification, Pioneer’s Registra­ § 1841 et seq.), (“BHC Act”) to be held by a bank tion Statement filed with the Board pursuant to the BHC Act, and other records of the Board. 3. Sections 1103(g) and 1103(h) of the Code require only that an 2. The prior certification noted that Pioneer owned and controlled election thereunder be made “at such time and in such manner as the 10.500 shares of Bank, but that under section 1101(c)(1) of the Code, Secretary [of the Treasury] or his delegate may by regulations pre­ 1.500 shares of Bank acquired by Pioneer after July 7, 1970, would not scribe.” As of this date no such regulations have been adopted. be entitled to the tax benefits under section 1101(b) of the Code. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 523 On the basis of the foregoing information, it is here­ of the Code, then section 1101(a) is applicable to such by certified that Pioneer has (before the expiration of property. Powell has indicated that it will acquire the the period prohibited property is permitted under the shares of New Farmers in a distribution by Farmers, BHC Act to be held by a bank holding company) and gain will not be recognized under section 1101(a) ceased to be a bank holding company. of the Code with respect to these shares. Accordingly, This certification is based upon the representations even though the shares of New Farmers that Powell made to the Board by Pioneer and upon the facts set proposes to distribute will be acquired after July 7, forth above. In the event the Board should determine 1970, those shares would nevertheless qualify as prop­ that facts material to this certification are otherwise erty eligible for the tax benefits provided in section than as represented by Pioneer, or that Pioneer has 1101(a) if those shares are, in fact, received by Powell failed to disclose to the Board other material facts, it in a transaction in which gain is not recognized under may revoke this certification. section 1011(a) of the Code. By order of the Board of Governors, acting through Finally, subparagraph (D) is corrected to read as fol­ its General Counsel, pursuant to delegated authority (12 lows: C.F.R. § 3(b)(3)), effective May 13, 1980. (D) the exchange of certain nonbanking property of Powell described in paragraph 4 hereof for the shares (Signed) Griffith L. Garwood, of New Powell and the distribution to the shareholders [seal] Deputy Secretary of the Board. of Powell of the shares of New Powell, as well as the shares of New Farmers, are necessary or appropriate to effectuate section 4 of the BHC Act. Powell Lumber Company, By order of the Board of Governors acting through Lake Charles, Louisiana its General Counsel, pursuant to delegated authority (12 C.F.R. § 265.2(b)(3)), effective May 2, 1980. Prior Certification Pursuant to the Bank Holding Company Tax Act of 1976 (Signed) Theodore E. Allison, [seal] Secretary of the Board. [Docket No. TCR 76-174] CORRECTION Order Under Section 2 of Bank Holding Company Act In the prior certification issued on April 2, 1980, to Powell Lumber Company, Lake Charles, Louisiana Pioneer Industrial Park, Inc., (“Powell”), paragraph 4 should be corrected to read Peoria, Illinois as follows: The nonbanking property to be divested by Powell Order Granting Determination Under the consist of lumbering, forestry and real estate opera­ Bank Holding Company Act tions which it has held since prior to July 7, 1970. Simi­ larly, the nonbanking property to be divested by Farm­ [Docket No. 089] ers consist of its farming and irrigation operations that were acquired prior to July 7, 1970. In addition, Powell Pioneer Industrial Park, Peoria, Illinois (“Pioneer”), a proposes to distribute the shares of New Farmers that bank holding company within the meaning of section it receives as a shareholder of Farmers.2 Thus, Powell 2(a) of the Bank Holding Company Act of 1956, as and Farmers acquired property on or before July 7, amended, 12 U.S.C. § 1841(a), (“Act”), by virtue of 1970, the disposition of which would be necessary or its control of Pioneer State Bank, Peoria, Illinois appropriate under section 4 of the BHC Act, if Powell (“Bank”), has requested a determination, pursuant to were to remain a bank holding company beyond De­ section 2(g)(3) of the Act, that Pioneer is not in fact cember 31, 1980, which property is “prohibited prop­ capable of controlling Fredrick A. Johnson, Jay D. erty” within the meaning of section 1103(c) of the Code. Johnson and James P. Johnson (“Johnson brothers”), In addition, footnote 2 should be added as follows: individuals to whom it transferred a portion of its inter­ 2. Under section 1101(c)(1) of the Code, property est in Bank, notwithstanding the fact that these indi­ acquired after July 7, 1970, generally does not qualify viduals are directors of Pioneer. for the tax benefits of section 1101(a) when distributed Under the provisions of section 2(g)(3) of the Act, by an otherwise qualified bank holding company. shares transferred after January 1, 1966, by any bank However, where such property was acquired by a holding company to a transferee that is indebted to the qualified bank holding company in a transaction on transferor or has one or more officers, directors, which gain was not recognized under section 1101(a) trustees, or beneficiaries in common with or subject to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

524 Federal Reserve Bulletin □ June 1980 control by the transferor are deemed to be indirectly appear to have been a means of perpetuating Pioneer’s owned or controlled by the transferor unless the control of Bank. On the basis of the above and other Board, after opportunity for hearing, determines that facts of record the Board concludes that Pioneer the transferor is not in fact capable of controlling the should be regarded as the alter ego of the Johnsons and transferee. that Pioneer does not control and is not in fact capable It is hereby determined that Pioneer is not, in fact, of controlling the Johnson brothers in their capacity as capable of controlling the Johnson brothers. This de­ transferees of Bank’s stock or otherwise. termination is based upon the evidence of record in Accordingly, it is ordered that the request of Pioneer this matter, including the following facts. Pioneer is a for a determination pursuant to section 2(g)(3) be and small closely held corporation, all the voting shares of is hereby granted. This determination is based upon which are owned in equal portions by the Johnson the representations made to the Board by Pioneer and brothers and their three sisters (collectively, “John­ the Johnsons. In the event the Board should hereafter sons”). The Johnsons constitute a majority of the di­ determine that facts material to this determination are rectors of Pioneer. Bank is also a small organization, otherwise than as represented, or that Pioneer or the holding total deposits of approximately $16 million. Johnsons have failed to disclose to the Board other Pioneer distributed pro rata 9,000 of its 10,500 shares material facts, this determination may be revoked, and of Bank to its six shareholders, the Johnsons, and re­ any change in the facts or circumstances relied upon tained 1,500 shares of Bank, representing 8.8 percent by the Board in making this determination could result of the outstanding voting shares of Bank. There are no in the Board reconsidering the determination made management interlocks between Pioneer and Bank. herein. The Johnsons now own directly 9,000 shares (52.4 per­ By order of the Board of Governors, acting through cent) of Bank and indirectly through Pioneer an addi­ its General Counsel, pursuant to delegated authority tional 1,500 shares (8.8 percent) of Bank. None of the (12 C.F.R. § 265.2(b)(1)) effective May 13, 1980. Johnsons is indebted to Pioneer. Inasmuch as the Johnsons own all of Pioneer’s voting shares, and have committed to exercise control of the shares of Bank as (Signed) Griffith L. Garwood, individuals, the distribution of Bank’s shares does not [seal] Deputy Secretary of the Board. Orders Approved Under Bank Holding Company Act By the Board of Governors During May 1980 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 Sys­ tem. Washington, D.C. 20551. Section 3 Board action (effective Applicant Bank(s) date) Ameribanc, Inc., The First National Bank of Centralia, May 27, 1980 St. Joseph, Missouri Centralia, Missouri Barnett Banks of Florida, Inc., Bank of Flagler Beach, May 9, 1980 Jacksonville, Florida Flagler Beach, Florida First American Bank Corporation, The Union National Bank & Trust Co., May 16,1980 Kalamazoo, Michigan Marquette, Michigan First American Bank Corporation, The Wayne Oakland Bank, May 6, 1980 Kalamazoo, Michigan Royal Oak, Michigan Manufacturers National Corporation Manufacturers Bank, May 12, 1980 Chicago, Illinois Chicago, Illinois Mercantile Bankshares Corporation, Fredericktown Bank & Trust Company May 9, 1980 Baltimore, Maryland Frederick, Maryland Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 525 Section 3—Continued Board action (effective Applicant Bank(s) date) Southeast Banking Corporation, Community Bank of Pasco, May 5, 1980 Miami, Florida Port Richey, Florida Southwest Bancshares, Inc., Century Bank and Trust Company May 13, 1980 Houston, Texas Garland, Texas Southwest Bancshares, Inc., County National Bank of Orange, May 9, 1980 Houston, Texas Orange, Texas By Federal Reserve Banks Recent applications have been approved by the Federal Reserve Banks as listed below. Copies of the orders are available upon request to the Reserve Banks. Section 3 Reserve Effective Applicant Bank(s) Bank date Adrian Building Corporation, Adrian State Bank, Minneapolis May 9, 1980 Adrian, Minnesota Adrian, Minnesota Affiliated Bankshares of Colorado, First National Bank, Kansas City April 25, 1980 Inc., Westminster, Boulder, Colorado Westminster, Colorado Bay Bancorporation, Inc., Bank of Riverview, Atlanta May 23, 1980 Riverview, Florida Riverview, Florida Blackwater Bancshares, Inc., Farmers Stock Bank, Kansas City May 8, 1980 Black water, Missouri Blackwater, Missouri Caldwell Bancshares, Inc., First State Bank in Caldwell, Dallas April 30, 1980 Caldwell, Texas Caldwell, Texas Central Bancorp., Central Bank, Kansas City May 2, 1980 Central City, Nebraska Central City, Nebraska Chase Financial Services, Inc., The Rice County State Bank, Kansas City May 9, 1980 Chase, Kansas Chase, Kansas Chatham Bancshares, Inc., Keytesville Bancshares, Inc., Kansas City May 2, 1980 Kansas City, Missouri Brookfield, Missouri Citizens Bancorp., Inc., The Citizens National Bank of Chicago May 28, 1980 Waukegan, Illinois Waukegan Waukegan, Illinois Colorado Springs Banking First Bank, Kansas City April 25, 1980 Corporation, Colorado Springs, Colorado Colorado Springs, Colorado Commerce Southwest Inc., First Bank & Trust of Dallas May 9, 1980 Dallas, Texas Richardson Richardson, Texas Converse County Capital Corporation, The Converse County Bank, Kansas City May 2,1980 Douglas, Wyoming Douglas, Wyoming Coronado Bancshares, Inc., Coronado State Bank, Dallas May 8,1980 El Paso, Texas El Paso, Texas CreditBank Shares, Inc., CreditBank, Atlanta May 6, 1980 Hollywood, Florida Miami, Florida Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

526 Federal Reserve Bulletin □ June 1980 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date Curtis BanCo, Inc., Curtis State Bank, Kansas City May 16,1980 Curtis, Nebraska Curtis, Nebraska Danville Bancshares, Inc., The Second National Bank of Chicago May 28,1980 Danville, Illinois Danville, Danville, Illinois Edgewood Bancshares, Inc., Edgewood Bank, Chicago May 22,1980 Countryside, Illinois Countryside, Illinois FB&T Financial Corporation, First Bank & Trust Company, Atlanta May 12,1980 Marietta, Georgia Marietta, Georgia Elba State Company, Elba State Bank, Kansas City May 15,1980 Elba, Nebraska Elba, Nebraska Farmers & Traders Bancorp of Mt. Farmers & Traders Bank of Mt. Cleveland May 12,1980 Olivet, Inc., Olivet, Inc., Mt. Olivet, Kentucky Mt. Olivet, Kentucky Fayette Bancorporation, Citizens Savings Bank, Chicago May 1,1980 Hawkeye, Iowa Hawkeye, Iowa First Des Plaines Corporation, The First National Bank of Des Chicago May 6,1980 Des Plaines, Illinois Plaines, Des Plaines, Illinois First Fabens Bancorporation, Inc., First National Bank of Fabens May 6,1980 Fabens, Texas Fabens, Texas First McHenry Corporation, The First National Bank of Chicago May 16, 1980 McHenry, Illinois McHenry, McHenry, Illinois First National of Henryetta, Inc., First National Bank, Kansas City May 16, 1980 Henryetta, Oklahoma Henryetta, Henryetta, Oklahoma Banc One Corporation, The First National Bank of Cleveland May 12,1980 Columbus, Ohio Fairborn, Fairborn, Ohio First Security Bancorp., Inc., Moline National Bank, Chicago May 28, 1980 Moline, Illinois Moline, Illinois First Security Bancshares, Inc., First Security Bank of Kansas City May 2,1980 Brookfield, Missouri Brookfield, Brookfield, Missouri Glenwood Bancorporation, Glenwood State Bank, Chicago May 23,1980 Glenwood, Iowa Glenwood, Iowa Green Country Bancorporation, Inc., The First State Bank, Kansas City May 12,1980 Ketchum, Oklahoma Ketchum, Oklahoma Hibernia Bancshares Corporation, The Hibernia Bank, San Francisco May 9,1980 San Francisco, California San Francisco, California Henning Bancshares Inc., The First National Bank of Minneapolis May 23,1980 Henning, Minnesota Henning, Henning, Minnesota HOPE BANK HOLDING First State Bank of Hope, Minneapolis May 13,1980 COMPANY, Hope, North Dakota Hope, North Dakota Illinois State Bancorp, Inc., Illinois State Bank of Chicago, Chicago May 30, 1980 Chicago, Illinois Chicago, Illinois Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 527 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date Isensee Corporation, First National Bank of Atlanta May 7, 1980 Naples, Florida Englewood, Englewood, Florida ISLAND CITY BANCORP, INC., Security State Bank, Minneapolis May 21, 1980 Minocqua, Wisconsin Minocqua, Wisconsin Jefferson Bancorp., Inc., Jefferson Trust and Savings Chicago May 14, 1980 Peoria, Illinois Bank of Peoria, Illinois Jefferson Bancshares, Inc., Jefferson Bank and Trust Atlanta May 29, 1980 Metairie, Louisiana Company, Metairie, Louisiana Lanark Bancshares, Inc., Exchange State Bank, Chicago May 23, 1980 Lanark, Illinois Lanark, Illinois LeRoy Bancshares, Inc., The First National Bank of Kansas City May 16, 1980 LeRoy, Kansas LeRoy, LeRoy, Kansas K. B. J. Enterprises, Inc., The Viking Corporation, Chicago May 15, 1980 Sibley, Iowa Denison, Iowa Knott Holding Company, Inc., The Farmers Bank of Bogard, Kansas City May 15, 1980 Bogard, Missouri Bogard, Missouri Landmark Bancshares Corporation, Harvester National Bank, St. Louis May 15,1980 Clayton, Missouri St. Charles County, Missouri Marbanco, Inc., Marengo State Bank, Chicago May 8, 1980 Marengo, Illinois Marengo, Illinois Marquette National Company, The First National Bank of Kansas City May 8, 1980 Marquette, Nebraska Marquette, Marquette, Nebraska Mountain Financial Company, Bank of Maryville, Atlanta May 14, 1980 Maryville, Tennessee Maryville, Tennessee Mustang Financial Corporation, First State Bank, Dallas May 30, 1980 Rio Vista, Texas Rio Vista, Texas Newco Corporation, Newton County Bank, St. Louis May 14, 1980 Jasper, Arkansas Jasper, Arkansas Nevada Bancshares, Inc., Thornton Bank, Kansas City May 2, 1980 Nevada, Missouri Nevada, Missouri Orbanco, Inc., Southern Oregon State Bank, San Francisco May 21, 1980 Portland, Oregon Grants Pass, Oregon Ray County Bancshares, Inc., Hardin State Bank, Kansas City May 9,1980 Hardin, Missouri Hardin, Missouri Seagraves Bancshares, Inc., The First State Bank in Dallas May 30,1980 Seagraves, Texas Seagraves, Seagraves, Texas Starke County Bancorp, Inc., Farmers Bank and Trust Chicago May 23, 1980 Knox, Indiana Company Knox, Indiana Streator Bancorp., Inc., The Streator National Bank Chicago May 28, 1980 Streator, Illinois Streator, Illinois Talmage Investment Company, The Talmage State Bank, Kansas City May 16, 1980 Talmage, Kansas Talmage, Kansas Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

528 Federal Reserve Bulletin □ June 1980 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date Van Dyke Bank Holding Corp., The First Trust and Savings Chicago May 14, 1980 Sioux City, Iowa Bank, Alta, Iowa West Side Bancshares, Inc., West Side National Bank of Dallas May 5,1980 San Angelo, Texas San Angelo, San Angelo, Texas Wichita Bancshares, Inc., Bank of Wichitas, Kansas City May 16,1980 Snyder, Oklahoma Snyder, Oklahoma Wilcox Bancshares, Inc., Grand Rapids State Bank, Minneapolis May 5, 1980 Grand Rapids, Minnesota Grand Rapids, Minnesota Sections 3 and 4 Nonbanking company Reserve Effective Applicant Bank(s) (or activity) Bank date Hereford Investment Co., Hereford State Bank, To engage directly Kansas City May 16, 1980 Hereford, Colorado Hereford, Colorado in general insurance agency activities. Second Security The Security Bank, Sale of credit life St. Louis May 7, 1980 Corporation, Corinth, Mississippi and credit Corinth, Mississippi accident and health insurance. Winslow Bancorporation, The First National Bank of To engage de novo St. Louis May 20, 1980 Inc., Winslow, Winslow, in the sale of Winslow, Indiana Indiana credit life and credit health and accident insurance. Section 4 Nonbanking company Reserve Effective Applicant (or activity) Bank date First International Bancshares, Inc., Silner Factors, Inc., Dallas May 28, 1980 Dallas, Texas Beverly Hills, California The Indiana National Corporation, The Monument Life Insurance Chicago May 15, 1980 Indianapolis, Indiana Company Phoenix, Arizona Manufacturers Hanover Corporation, Reinsuring credit life insurance New York May 14, 1980 New York, New York Nebanco, Inc., Operation of a full line general Kansas City May 12, 1980 Wallace, Nebraska insurance agency Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 529 Section 4—Continued Nonbanking company Reserve Effective Applicant (or activity) Bank date Nobles Agency, Inc., To continue to sell insurance as Minneapolis May 22, 1980 Brewster, Minnesota a general insurance agent Rexford Investment Co., Inc., Operation of a general Kansas City May 12, 1980 Rexford, Kansas insurance agency Wells Fargo & Company, To engage in the business of San Francisco May 27, 1980 San Francisco, California lending Pending Cases Involving the Board of Governors *This list of pending cases does not include suits Ella Jackson et al., v. Board of Governors, filed May against the Federal Reserve Banks in which the Board 1979, U.S.C.A. for the Fifth Circuit. of Governors is not named a party. Memphis Trust Company v. Board of Governors, filed May 1979, U.S.C.A. for the Sixth Circuit. Albert A. Rapoport v. Board of Governors and Manu­ Independent Insurance Agents of America, et al., v. facturers Hanover Trust Co., filed February 1980, Board of Governors, filed May 1979, U.S.C.A. for U.S.D.C. for the District of Columbia. the District of Columbia. American Trust Co. of Hawaii, et al., v. Board of Gov­ Independent Insurance Agents of America, et al., v. ernors, filed January 1980, U.S.D.C. for the District Board of Governors, filed April 1979, U.S.C.A. for of Columbia. the District of Columbia. Independent Bank Corporation v. Board of Gover­ Independent Insurance Agents of America, et al. v nors, filed October 1979, U.S.C.A. for the Sixth Cir­ Board of Governors, filed March 1979, U.S.C. A. for cuit. the District of Columbia. Wiley v. United States, et al., filed September 1979, Credit and Commerce American Investment, et al., v U.S.D.C. for the District of Columbia. Board of Governors, filed March 1979 U.S.C. A. for County National Bancorporation and TGB Co. v. the District of Columbia. Board of Governors, filed September 1979, Independent Bankers Association of Texas v. First U.S.C.A. for the Eighth Circuit. National Bank of Dallas, et al., filed July 1978, Edwin F. Gordon v. Board of Governors, et al., filed U.S.D.C. for the Northern District of Texas. August 1979, U.S.D.C. for the Northern District of Mid-Nebraska Bancshares, Inc. v. Board of Gover­ Georgia. nors, filed July 1978, U.S.C.A. for the District of Edwin F. Gordon v. Board of Governors, et al., filed Columbia. August 1979, U.S.C.A. for the Fifth Circuit. American Bankers Association v. Board of Governors, Security Bancorp and Security National Bank v. et al., filed August 1979, U.S.D.C. for the District of Board of Governors, filed March 1978, U.S.C.A. for Columbia. the Ninth Circuit. Gregory v. Board of Governors, filed July 1979, Vickars-Henry Corp. v. Board of Governors, filed De­ U.S.D.C. for the District of Columbia. cember 1977, U.S.C.A. for the Ninty Circuit. Donald W. Riegel, Jr. v. Federal Open Market Com­ Investment Company Institute v. Board of Governors, mittee, filed July 1979, U.S.D.C. for the District of filed September 1977, U.S.D.C. for the District of Columbia. Columbia. Connecticut Bankers Association, et al., v. Board of Robert Farms, Inc. v. Comptroller of the Currency, et Governors, filed May 1979, U.S.C.A. for the Dis­ al., filed November 1975, U.S.D.C. for the Southern trict of Columbia. District of California. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Al Financial and Business Statistics Contents Domestic Financial Statistics Weekly Reporting Commercial Banks A3 Monetary aggregates and interest rates Assets and liabilities A4 Factors affecting member bank reserves A20 All reporting banks A5 Reserves and borrowings of member banks A21 Banks with assets of $ 1 billion or more A6 Federal funds and repurchase agreements of A22 Banks in New York City large member banks A23 Balance sheet memoranda A24 Commercial and industrial loans Policy Instruments A24 Major nondeposit funds of commercial banks A25 Gross demand deposits of individuals, A7 Federal Reserve Bank interest rates partnerships, and corporations A8 Member bank reserve requirements A9 Maximum interest rates payable on time and savings deposits at federally insured institutions Financial Markets A10 Federal Reserve open market transactions A25 Commercial paper and bankers dollar acceptances outstanding Federal Reserve Banks A26 Prime rate charged by banks on short-term business loans Al 1 Condition and Federal Reserve note statements A26 Terms of lending at commercial banks A12 Maturity distribution of loan and security A27 Interest rates in money and capital markets holdings A28 Stock market—Selected statistics A29 Savings institutions—Selected assets and Monetary and Credit Aggregates liabilities A12 Bank debits and deposit turnover A13 Money stock measures and components Federal Finance A14 Aggregate reserves and deposits of member banks A30 Federal fiscal and financing operations A15 Loans and securities of all commercial banks A31 U.S. budget receipts and outlays A32 Federal debt subject to statutory limitation A32 Gross public debt of U.S. Treasury—Types and Commercial Bank Assets and Liabilities ownership A33 U.S. government marketable securities— A16 Last-Wednesday-of-month series Ownership, by maturity A17 Call-date series A34 U.S. government securities dealers— A18 Detailed balance sheet, September 30,1978 Transactions, positions, and financing A35 Federal and federally sponsored credit agencies—Debt outstanding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A2 Federal Reserve Bulletin □ June 1980 Securities M arkets and A56 Foreign branches of U.S. banks—Balance sheet C orporate Finance data A58 Selected U .S. liabilities to foreign official A36 New security issues—State and local institutions governments and corporations A37 Open-end investm ent com panies—N et sales and asset position R eported by Banks in the U nited S tates A37 Corporate profits and their distribution A38 Nonfinancial corporations—Assets and liabilities A58 Liabilities to and claims on foreigners A38 Business expenditures on new plant and A59 Liabilities to foreigners equipment A61 Banks’ own claims on foreigners A39 Domestic finance com panies—Assets and A62 Banks’ own and domestic custom ers’ claims on liabilities; business credit foreigners A62 Banks’ own claims on unaffiliated foreigners A63 Claims on foreign countries—Combined R eal E state domestic offices and foreign branches A40 M ortgage m arkets A41 M ortgage debt outstanding Securities H oldings and Transactions A64 M arketable U .S. Treasury bonds and notes— C onsum er Installm ent Credit Foreign holdings and transactions A64 Foreign official assets held at Federal Reserve A42 Total outstanding and net change Banks A43 Extensions and liquidations A65 Foreign transactions in securities Flow of F unds R eported by N onbanking B usiness Enterprises in the U nited S tates A44 Funds raised in U .S. credit markets A66 Liabilities to unaffiliated foreigners A45 Direct and indirect sources of funds to credit A67 Claims on unaffiliated foreigners markets Interest and Exch ange R ates D o m estic N onfinan cial S tatistics A68 Discount rates of foreign central banks A46 Nonfinancial business activity—Selected A68 Foreign short-term interest rates measures A68 Foreign exchange rates A46 Output, capacity, and capacity utilization A47 Labor force, em ployment, and unem ployment A48 Industrial production—Indexes and gross value S pecial T ables A50 Housing and construction A 51 Consumer and producer prices A69 Survey of Time and Savings Deposits A52 Gross national product and income at Commercial Banks, October 31, 1979 A53 Personal income and saving A73 G uide to T abu lar P resen tation an d In tern ation al S tatistics S ta tistica l R eleases A54 U.S. international transactions— Summary A55 U.S. foreign trade A55 U.S. reserve assets Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Statistics A3 1.10 MONETARY AGGREGATES AND INTEREST RATES 1979 1980 Item Q2 Q3 Q4 Ql Feb. Mar. Apr. Monetary and credit aggregates (annual rates of change, seasonally adjusted in percent)1 Member bank reserves 1 Total........................................................................... -3.7 5.0 12.6 5.1 16.3 2.8 -4.4 6.7 2.7 2 Required ................................................................... -3.5 4.7' 11.8' 5.4 12.0' 4.2 -0.2 5.1 2.2 3 Nonborrowed ........................................................... -7.5 6.9 7.0 4.3 30.0 9.6 -16.4 -26.9 13.8 4 Monetary base2 ....................................................... 4.8 9.3 9.6 7.9' 7.6 10.3 5.7 7.3' 2.0 Concepts of money and liquid assets3 5 M-1A......................................................................... 7.8 8.8 4.7 5.5 6.2 3.6 12.2 -3.2 -18.5 6 M-1B ......................................................................... 10.7 10.1 5.3 6.0 7.5 4.0 11.7' -1.2' -14.7 7 M-2 ........................................................................... 10.2 10.3 7.2 7.5' 7.7 6.8 10.7' 3.8' -2.9 8 M-3 ........................................................................... 8.8 10.3 9.9 8.4 7.5 7.9 12.7' 3.5' 0.2 9 L ................................................................................. 13.1 11.7 9.2' 9.0' 8.6' 8.3' 12.5' 8.3' Time and savings deposits Commercial banks 10 Total....................................................................... 1.8 9.1 12.5 8.6 0.9 8.0 16.2 7.3 16.2 11 Savings4 ................................................................. -7.4 -0.4 -15.1 -16.8 -9.7 -12.3 -16.1 -34.6 -40.8 12 Small-denomination time5 ................................ 22.5 21.5 28.6 28.1 18.9 24.6 28.6 34.1' 49.1 13 Large-denomination time6 ................................ -7.9 6.0 22.6 10.6 -7.8 6.8 30.6 12.7 25.1 14 Thrift institutions7 ................................................... 7.4 7.4 6.7 2.6' 6.5 -.9' 1.4' 4.0' 3.2 15 Total loans and securities at commercial banks8 11.5' 13.4' 8.7' 9.4' 4.1 12.8 18.7 2.6 -4.3 1979 Q2 Q3 Q4 Ql Jan. Feb. Mar. Apr. May Interest rates (levels, percent per annum) Short-term rates 16 Federal funds9 ................................................................................. 10.18 10.94 13.58 15.07 13.82 14.13 17.19 17.61 10.98 17 Federal Reserve discount10 .......................................................... 9.50 10.21 11.92 12.51 12.00 12.52 13.00 13.00 12.94 18 Treasury bills (3-month market vield)11 ...................................... 9.38 9.67 11.84 13.35 12.00 12.86 15.20 13.20 8.58 19 Commercial paper (3-month)1112 ................................................ 9.85 10.64 13.35 14.54 13.04 13.78 16.81 15.78 9.49 Long-term rates Bonds 20 U.S. government13....................................................................... 9.08 9.03 10.18 11.78 10.65 12.21 12.49 11.42 10.44 21 State and local government14.................................................... 6.22 6.28 7.20 8.23 7.35 8.16 9.17 8.63 7.59 22 Aaa utility (new issue)15............................................................ 9.66 9.64 11.21 13.22 11.73 13.57 14.00 12.90 11.53 23 Conventional mortgages16 ............................................................ 10.35 11.13 12.38 n.a. 12.80c 14.10 16.05 15.55 13.20 1. Unless otherwise noted, rates of change are calculated from average amounts 4. Savings deposits exclude NOW and ATS accounts at commercial banks. outstanding in preceding month or quarter. Growth rates for member bank reserves 5. Small-denomination time deposits are those issued in amounts of less than are adjusted for discontinuities in series that result from changes in Regulations $100,000. D and M. 6. Large-denomination time deposits are those issued in amounts of $100,000 2. Includes total reserves (member bank reserve balances in the current week or more. plus vault cash held two weeks earlier); currency outside the U.S. Treasury, Federal 7. Savings and loan associations, mutual savings banks, and credit unions. Reserve Banks, and the vaults of commercial banks; and vault cash of nonmember 8. Changes calculated from figures shown in table 1.23. banks. 9. Seven-day averages of daily effective rates (average of the rates on a given 3. M-l A: Averages of daily figures for (1) demand deposits at all commercial date weighted by the volume of transactions at those rates). banks other than those due to domestic banks, the U.S. government, and foreign 10. Rate for the Federal Reserve Bank of New York. banks and official institutions less cash items in the process of collection and 11. Quoted on a bank-discount basis. Federal Reserve float; and (2) currency outside the Treasury, Federal Reserve 12. Beginning Nov. 1977, unweighted average of offering rates quoted by at banks, and the vaults of commercial banks. least five dealers. Previously, most representative rate quoted by these dealers. M-1B: M-l A plus negotiable order of withdrawal and automated transfer service Before Nov. 1979, data shown are for 90- to 119-day maturity. accounts at banks and thrift institutions, credit union share draft accounts, and 13. Market yields adjusted to a 20-year maturity by the U.S. Treasury. demand deposits at mutual savings banks. 14. Bond Buyer series for 20 issues of mixed quality. M-2: M-1B plus savings and small-denomination time deposits at all depository 15. Weighted averages of new publicly offered bonds rated Aaa, Aa, and A by institutions, overnight repurchase agreements at commercial banks, overnight Moody’s Investors Service and adjusted to an Aaa basis. Federal Reserve com­ Eurodollars held by U.S. residents other than banks at Caribbean branches of pilations. member banks, and money market mutual fund shares. 16. Average rates on new commitments for conventional first mortgages on new M-3: M-2 plus large-denomination time deposits at all depository institutions homes in primary markets, unweighted and rounded to nearest 5 basis points, from and term RPs at commercial banks and savings and loan associations. Dept, of Housing and Urban Development. L: M-3 plus other liquid assets such as term Eurodollars held by U.S. residents other than banks, bankers acceptances, commercial paper, Treasury bills and other liquid Treasury securities, and U.S. savings bonds. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A4 Domestic Financial Statistics □ June 1980 1.11 FACTORS AFFECTING MEMBER BANK RESERVES Millions of dollars Monthly averages of daily figures Weekly averages of daily figures for week-ending Factors 1980 1980 Mar.P Apr .p May? Apr. 16 p Apr. 23p Apr. 30^ May Ip May 14p May 21 p May 28p Supplying Reserve Funds 1 Reserve Bank credit outstanding............................ 136,504 139,098 139,561 137,880 141,682 140,025 138,510 138,630 140,624 139,623 2 U.S. government securities1 ........................................... 115,902 118,636 120,689 117.688 120,823 119.509 118,535 119.953 122.295 120,851 3 Bought outright ............................................................. 115,473 118,268 120,282 117.688 119,886 119.509 118,290 119.953 122.295 120,125 4 Held under repurchase agreements ....................... 429 368 407 0 937 0 245 0 0 726 5 Federal agency securities ............................................... 8,341 8,910 8,974 8.877 9,146 8.877 8,992 8.877 8.877 9,088 6 Bought outright ............................................................. 8,212 8,833 8,877 8.877 8,877 8.877 8,877 8.877 8.877 8,877 7 Held under repurchase agreements ....................... 129 77 97 0 269 0 115 0 0 211 8 Acceptances ........................................................................ 76 55 75 0 155 0 109 0 0 119 9 Loans ..................................................................................... 2,828 2,444 1,028 2,276 2,555 2,664 1,329 1,021 839 1,123 10 Float ....................................................................................... 4,658 3,902 3,642 3,896 3,741 3,651 4,107 3,218 3,875 3,532 4,699 5,151 5,153 5,144 5,263 5,324 5,437 5,561 4,738 4,909 12 Gold stock............................................................................ 11,172 11,172 11,172 11,172 11,172 11,172 11,172 11,172 11,172 11,172 13 Special drawing rights certificate account................ 2,968 2,968 2,968 2,968 2,968 2,968 2,968 2,968 2,968 2,968 14 Treasury currency outstanding...................................... 13,132 13,215 13,258 13,209 13,218 13,253 13,246 13,253 13,262 13,267 Absorbing Reserve Funds 15 Currency in circulation............................................... 122,437 123,717 124,730 124,097 123,740 123,304 123,917 124,713 124,750 125,187 16 Treasury cash holdings .................................................... 535 589 577 593 593 590 584 588 577 566 Deposits, other than member bank reserves, with Federal Reserve Banks 17 Treasury............................................................................ 2,773 2,647 2,828 1,256 3,362 3,845 2,442 2,807 3,020 2,614 18 Foreign............................................................................... 346 346 377 323 315 365 367 467 328 355 19 Other* .............................................................................. 403 500 643 447 625 571 536 515 523 778 20 Other Federal Reserve liabilities and capital........ 4,881 4,990 5,078 4,907 5,117 5,007 5,138 5,069 5,066 5,043 21 Reserve accounts3 ...................................................... 32,400 33,663 32,726 33,606 35,289 33,735 32,911 31,863 33,762 32,486 End-of-month figures Wednesday figures 1980 1980 Mar .p Apr .p MayP Apr. \6p Apr. 22>p Apr. 30p May Ip May 14p May 21 p May 28p Supplying Reserve Funds 22 Reserve bank credit outstanding ............................ 136,313 141,107 142,105 139,391 140,713 141,107 138,056 142,543 138,811 145,684 23 U.S. government securities1 .................................. 116,657 118.825 124,277 117.015 119,611 118.825 118.277 122.454 120.095 124,202 24 Bought outright ............................................... 115,734 118.825 121,371 117.015 119,402 118.825 118.277 122.454 120.095 121,200 25 Held under repurchase agreements ................ 923 0 2,906 0 209 0 0 0 0 3,002 26 Federal agency securities ...................................... 8,291 8.877 9,230 8.877 9,125 8.877 8.877 8.877 8.877 9,801 27 Bought outright .................................................. 8,211 8.877 8,877 8.877 8,877 8.877 8.877 8.877 8.877 8,877 28 Held under repurchase agreements............... 80 0 353 0 248 0 0 0 0 924 29 Acceptances ................................................................... 171 0 366 0 0 0 0 0 0 612 30 Loans ................................................................................. 2,502 4,770 602 3,579 2,962 4,770 927 1,585 886 2,400 31 Float ........................................................................... 3,682 3,072 2,475 4,639 3,646 3,072 4,442 3,777 4,008 3,605 32 Other Federal Reserve assets .............................. 5,010 5,563 5,155 5,281 5,369 5,563 5,533 5,850 4,945 5,064 33 Gold stock................................................................ 11,172 11,172 11,172 11,172 11,172 11,172 11,172 11,172 11,172 11,172 34 Special drawing rights certificate account............. 2,968 2,968 2,968 2,968 2,968 2,968 2,968 2,968 2,968 2,968 35 Treasury currency outstanding................................ 13,352 13,410 13,271 13,218 13,218 13,410 13,250 13,260 13,266 13,271 Absorbing Reserve Funds 36 Currency in circulation............................................ 122,943 123,963 125,430 124,410 123,688 123,963 124,686 125,027 125,089 125,949 586 584 55397 Treasu5r9y1 cash ho5l9d2ings.......5..8..4...............5.8..5...............587 574 562 Deposits, other than member bank reserves, with Federal Reserve Banks 38 Treasury................................................................ 2,334 4,561 4,523 3,164 5,212 4,561 3,367 2,080 3,119 2,297 39 Foreign.............................................................................. 468 648 380 342 322 648 409 351 350 383 40 OtheP .............................................................................. 313 553 1,160 494 571 553 526 478 528 1,163 41 Other Federal Reserve liabilities and capital........ 4,886 5,066 5,083 4,848 4,983 5,066 4,966 4,929 4,867 4,979 42 Reserve accounts3 ...................................................... 32,270 33,282 32,382 32,900 32,703 33,282 30,907 36,491 31,690 37,763 1. Includes securities loaned—fully guaranteed by U.S. government securities 3. Includes reserves of member banks, Edge Act corporations and U.S. agencies pledged with Federal Reserve Banks—and excludes (if any) securities sold and and branches of foreign banks. scheduled to be bought back under matched sale-purchase transactions. Note: For amounts of currency and coin held as reserves, see table 1.12 2. Includes special deposits under the credit restraint program held by money market mutual funds and other financial intermediaries, held by nonmember banks against managed liabilities, and held by any institution in conjunction with the consumer credit restraint program. 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 1978 1979 1980 Dec. Sept. Oct. Nov. Dec. Jan. Feb. Mar.P Apr.P May All member banks Reserves 1 At Federal Reserve Banks............................ 31,158 29,986 31,455 32,030 32,473 32,712 31,878 32,400 33,663 32,726 2 Currency and coin .......................................... 10,330 10,726 10,681 10,737 11,344 12,283 11,063 10,729 10,895 10,998 3 Total held1......................................................... 41,572 40,868 42,279 42,908 43,972 45,170 43,156 43,352 44,769 43,933 4 Required ....................................................... 41,447 40,863 42,007 42,753 43,578 44,928 42,966 42,907 44,678 43,798 5 Excess1 ........................................................... 125 5 272 155 394 242 190 445 91 135 Borrowings at Reserve Banks2 6 Total ................................................................... 874 1,344 2,022 1,906 1,473 1,241 1,655 2,828 2,443 1,028 7 Seasonal ............................................................. 134 169 161 146 82 75 96 152 156 64 Large banks in New York City 8 Reserves held ....................................................... 7,120 6,437 6,915 6,913 7,401 7,758 7,168 7,276 7,603 7,596 9 Required ........................................................... 7,243 6,378 6,855 6,932 7,326 7,760 7,205 7,194 7,655 7,665 10 Excess ............................................................... -123 59 60 -19 75 -2 -37 82 -52 -69 11 Borrowings2........................................................... 99 87 180 143 66 26 125 60 81 31 Large banks in Chicago 12 Reserves held ....................................................... 1,907 1,654 1,863 1,940 2,036 2,051 1,968 1,886 2,150 1,922 13 Required ........................................................... 1,900 1,760 1,859 1,950 2,005 2,063 1,941 1,961 2,173 1,906 14 Excess ............................................................... 7 -106 4 -10 31 -12 27 -75 -23 16 15 Borrowings2........................................................... 10 80 136 122 90 60 97 137 60 28 Other large banks 16 Reserves held ....................................................... 16,446 16,426 16,840 16,970 17,426 18,078 17,246 17,029 17,644 17,379 17 Required ........................................................... 16,342 16,491 16,799 17,004 17,390 18,065 17,265 17,135 17,991 17,545 18 Excess ............................................................... 104 -65 41 -34 36 13 -19 -106 -347 -166 19 Borrowings2........................................................... 276 600 883 803 707 647 729 1,479 1,287 808 All other banks 20 Reserves held ....................................................... 16,099 16,351 16,571 16,582 16,734 16,904 16,403 16,261 16,314 16,271 21 Required ........................................................... 15,962 16,234 16,422 16,398 16,536 16,692 16,229 16,233 16,367 16,234 22 Excess ............................................................... 137 117 149 184 198 212 174 28 -53 37 23 Borrowings2........................................................... 489 577 823 838 610 508 704 1,152 1,015 161 Edge corporations 24 Reserves held ....................................................... n.a. n.a. 90 308 336 339 328 317 339 335 25 Required ........................................................... n.a. n.a. 72 288 303 323 303 300 299 295 26 Excess ............................................................... n.a. n.a. 18 20 33 16 25 17 40 40 U.S. agencies and branches 27 Reserves held ....................................................... n.a. n.a. n.a. 195 39 40 43 90 198 162 28 Required ........................................................... n.a. n.a. n.a. 181 18 25 23 84 193 153 29 Excess ............................................................... n.a. n.a. n.a. 14 21 15 20 6 5 9 Weekly averages of daily figures for week (in 1980) ending Mar. 26p Apr. 2p Apr. 9p Apr. 16p Apr. 23p Apr. 30p May Ip May 14 p May 21 p May 28p All member banks Reserves 30 At Federal Reserve Banks............................ 32,587 32,900 33,042 33,606 35,289 33,735 32,911 31,863 33,762 32,486 31 Currency and coin .......................................... 10,261 10,766 11,094 11,039 10,184 11,299 11,413 11,419 10,196 10,924 32 Total held1......................................................... 43,073 43,880 44,350 44,854 45,681 45,244 44,535 43,491 44,167 43,619 33 Required ....................................................... 42,941 43,482 44,151 44,615 45,258 45,028 44,234 43,449 43,914 43,614 34 Excess1 ........................................................... 132 398 199 239 423 216 301 42 253 5 Borrowings at Reserve Banks2 35 Total ................................................................... 2,660 2,262 2,386 2,276 2,555 2,664 1,329 1,021 839 1,123 36 Seasonal ............................................................. 111 165 154 140 159 172 155 47 41 29 Large banks in New York City 37 Reserves held ....................................................... 7,083 7,498 7,674 7,560 7,926 7,671 7,628 7,313 8,042 7,351 38 Required ........................................................... 7,074 7,471 7,452 7,712 7,785 7,725 7,566 7,445 7,829 7,664 39 Excess ............................................................... 9 27 222 -152 141 -54 62 -132 213 -313 40 Borrowings2........................................................... 71 89 194 44 92 0 89 0 48 Large banks in Chicago 41 Reserves held ....................................................... 1,779 1,970 2,318 2,161 1,984 2,209 1,950 1,813 2,057 1,813 42 Required ........................................................... 1,985 2,006 2,265 2,239 2,150 2,084 1,920 1,902 1,955 1,859 43 Excess ............................................................... -206 -36 53 -78 -166 125 30 -89 102 -46 44 Borrowings2........................................................... 117 12 10 68 54 122 11 0 0 108 Other large banks 45 Reserves held ....................................................... 16,789 17,525 17,223 17,794 17,972 17,815 17,952 17,363 17,283 17,185 46 Required ........................................................... 17,157 17,327 17,663 17,933 18,347 18,210 17,905 17,540 17,471 17,400 47 Excess ............................................................... -368 198 -440 -139 -375 -395 47 -177 -188 -215 48 Borrowings2........................................................... 1,342 978 1,338 1,056 1,345 1,484 866 831 773 899 All other banks 49 Reserves held ....................................................... 16,326 16,305 16,175 16,184 16,332 16,628 16,474 16,119 16,194 16,289 50 Required ........................................................... 16,352 16,271 16,119 16,177 16,556 16,644 16,449 16,104 16,221 16,208 51 Excess ............................................................... -26 34 56 7 -224 -16 25 15 -27 81 52 Borrowings2........................................................... 1,130 1,183 1,038 958 1,112 966 452 101 66 68 Edge corporations 53 Reserves held ....................................................... 298 341 327 368 328 317 317 338 321 348 54 Required ........................................................... 282 305 272 340 287 293 298 293 292 290 55 Excess ............................................................... 16 36 55 28 41 24 19 45 29 58 U.S. agencies and branches 56 Reserves held ....................................................... 101 107 380 216 141 80 105 188 158 188 57 Required ........................................................... 91 102 380 214 133 72 96 165 146 193 58 Excess ............................................................... 10 5 0 2 8 8 9 23 12 -5 1. Adjusted to include waivers of penalties for reserve deficiencies in accordance Reserve System. For weeks for which figures are preliminary, figures by class of with Board policy, effective Nov. 19, 1975, of permitting transitional relief on a bank do not add to total because adjusted data by class are not available, graduated basis over a 24-month period when a nonmember bank merged into an 2. Based on closing figures, existing member bank, or when a nonmember bank joins the Federal Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A6 Domestic Financial Statistics □ June 1980 1.13 FEDERAL FUNDS AND REPURCHASE AGREEMENTS Large Member Banks^ Averages of daily figures, in millions of dollars 1980, week ending Wednesday By maturity and source Apr. 2 Apr. 9 Apr. 16 Apr. 23 Apr. 30 May 7 May 14 May 21 May 28 One day and continuing contract 1 Commercial banks in U.S.................................................... 44,601' 50,537 48,918 46,306' 42,381' 46,302 46,691 47,032 45,172 2 Other depositary institutions, foreign banks and foreign official institutions, and U.S. government agencies 12,978' 11,711 11,486 12,100 12,214' 12,278 14,105 15,397 14,682 3 Nonbank securities dealers................................................. 1,595 1,090 1,065 1,359 1,222 1,218 1,068 1,327 1,264 4 All other ............................................................................... 13,750' 12,276 13,200 13,196 13,119' 13,263 12,473 13,192 14,059 All other maturities 5 Commercial banks in U.S.................................................... 5,103' 6,250 5,677 6,054 6,208 6,051 5,931 6,001 6,532 6 Other depositary institutions, foreign banks and foreign official institutions, and U.S. government agencies 6,315 7,023 6,640 6,622 6,807 6,945 6,787 6,751 6,803 7 Nonbank securities dealers................................................. 2,283 2,134 2,949' 2,375 2,279 2,297 2,208 2,452 2,383 8 All other ............................................................................... 9,369' 10,517' 8,947' 9,058' 8,844' 9,581 10,149 8,541 9,233 Memo: Federal funds and resale agreement loans in ma­ turities of one day or continuing contract 9 Commercial banks in U.S.................................................... 14,255 16,086' 14,849 14,191' 13,908' 16,131 15,542 16,597 14,810 10 Nonbank securities dealers................................................. 1,980 1,816' 2,217 2,261' 2,275' 1,890 2,051 2,129 1,850 1. Banks with assets of $1 billion or more as of December 31, 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments Al 1.14 FEDERAL RESERVE BANK INTEREST RATES Percent per annum Current and previous levels Loans to member banks Under sec. 10(b)1 Loans to all others under sec. 13, last par.2 Federal Reserve Under secs. 13 and 13a3 Bank Regular rate Special rate4 Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous 5/31/80 date rate 5/31/80 date rate 5/31/80 date rate 5/31/80 date rate Boston ........ 12 5/29/80 13 12V^ 5/29/80 l3Vz 13 5/29/80 14 15 5/29/80 16 New York .. 12 5/30/80 13 12 Vz 5/30/80 13 Vz 13 5/30/80 14 15 5/30/80 16 Philadelphia . 12 5/29/80 13 nvi 5/29/80 13VS 13 5/29/80 14 15 5/29/80 16 Cleveland ... 12 5/29/80 13 nvi 5/29/80 13V2 13 5/29/80 14 15 5/29/80 16 Richmond ... 12 5/29/80 13 nvi 5/29/80 13V> 13 5/29/80 14 15 5/29/80 16 Atlanta ........ 12 5/29/80 13 YlVi 5/29/80 l3Vz 13 5/29/80 14 15 5/29/80 16 Chicago........ 12 5/29/80 13 12 Vz 5/29/80 13fc 13 5/29/80 14 15 5/29/80 16 St. Louis---- 12 5/29/80 13 12 Vz 5/29/80 13 Vi 13 5/29/80 14 15 5/29/80 16 Minneapolis . 12 5/29/80 13 12 Vz 5/29/80 13V2 13 5/29/80 14 15 5/29/80 16 Kansas City . 12 5/29/80 13 12 Vz 5/29/80 13 Vz 13 5/29/80 14 15 5/29/80 16 Dallas .......... 12 5/29/80 13 l2Vz 5/29/80 13 Vz 13 5/29/80 14 15 5/29/80 16 San Francisco 12 5/29/80 13 12Vz 5/29/80 13 Vz 13 5/29/80 14 15 5/29/80 16 Range of rates in recent years5 Range (or F.R. Range (or F.R. Range (or F.R. Effective date A le l v l e F l) . — R. B o an f k Effective date A le l v l e F l) . — R. Ba o n f k Effective date A le l v l e F l) . — R. B o an f k Banks N.Y. Banks N.Y. Banks N.Y. In effect Dec. 31, 1970 .............. 5Vz 5Vz 1973— July 2 ................ 7 7 1977— Sept. 2 ................ 53/4 53/4 Aug. 14 ................ 1-1 Vz IVz Oct. 26 ................ 6 6 1971— Jan. 8 .......................... 5Va-5 Vz 5Va 23 ................ iVz IVz 15 .......................... SVa 5Va 1978— Jan. 9 ................ 6-6 6 Vz 19 .......................... 5-5V4 5Va 1974- Apr. 25 ................ lVz-% 8 20 ................ 6 Vz 6 Vz 22 .......................... 5-514 5 30 ................ 8 8 May 11 ................ 6^-7 1 29 .......................... 5 5 Dec. 9 ................ 7H-8 73/4 12 ................ 7 1 Feb. 13 .......................... 43/^5 5 16 ................ 73/4 73/4 July 3 ................ 7-71/4 IVa 19 .......................... 43/4 43/4 10 ................ 1Va-P/a IVa July 16 .......................... 43/4-5 5 1975— Jan. 6 ................ IVa IVa Aug. 21.................. V/a 73/4 23 .......................... 5 5 10 ................ IVa IVa Sept. 22 ................ 8 8 Nov. 11 .......................... 43/4-5 5 24 ................ IVa IVa Oct. 16 ................ 8-8 SVz 19 .......................... 43/4 43/4 Feb. 5 ................ Q/\-1Va 63/4 20 ................ 8 Vz 8Vz Dec. 13 .......................... 4te-43/4 43/4 7 ................ 6^4 63/4 Nov. 1 ................ SVzr-9Vz 9 Vz 17 .......................... 41^-43/4 4Vz Mar. 10 ................ 6V4-63/4 6Va 3 ................ 9 Vz 9 Vz 24 .......................... 4Vz 4 Vz 14 ................ 6Va 61/4 May 16 ................ 6-6V4 6 1979— July 20 ................ 10 10 1973— Jan. 15 .......................... 5 5 Aug. 17 ................ 10-10 Vz 10^ Feb. 26 .......................... 5-5 Vz 5 Vz 20 ................ 10 Vz • 10 Vz Mar. 2 .......................... 5Vz 5 Vz 1976— Jan. 19 ................ 5^-6 5Vz Sept. 19 ................ lOVzr-ll 11 Apr. 23 .......................... 5k>-53/4 5 Vz 23 ................ 5 Vz 5Vz 21 ................ 11 11 May 4 .......................... 53/4 53/4 Nov. 22 ................ 5Va-5Vz 5 Va Oct. 8 ................ 11-12 12 11 .......................... 53A-6 6 26 ................ 5Va 5V4 10 12 12 18 .......................... 6 6 June 11 .......................... 6-6V1 6 Vz 1977—Aug. 30 ................ 5»/4-53/4 5Va 1980— Feb. 15 ................ 12-13 13 15 .......................... 6 Vz 6Vz 31 ................ 5!/4-53/4 53/4 19 ................ 13 13 May 29 ................ 12-13 13 30 ................ 12 12 In effect May 31, 1980 12 12 1. Advances secured to the satisfaction of the Federal Reserve Bank. Advances U.S. government obligations or any other obligations eligible for Federal Reserve secured by mortgages on 1- to 4-family residential property are made at the section Bank purchase. 13 rate. 4. Applicable to special advances described in section 201.2(e)(2) of Regulation 2. Advances to individuals, partnerships, or corporations other than member A. banks secured by direct obligations of, or obligations fully guaranteed as to prin­ 5. Rates under secs. 13 and 13a (as described above). For description and earlier cipal and interest by, the U.S. government or any agency thereof. data, see the following publications of the Board of Governors: Banking and 3. Discounts or eligible paper and advances secured by such paper or by Monetary Statistics, 1914-1941 and 1941-1970; Annual Statistical Digest, 1971-1975, 1972-1976, 1973-1977, and 1974-1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 Domestic Financial Statistics □ June 1980 1.15 MEMBER BANK RESERVE REQUIREMENTS1 Percent of deposits Requirements in effect Previous requirements Type of deposit, and deposit interval May 31, 1980 in millions of dollars Percent Effective date Percent Effective date Net demand2 0-2 ......................................................................................................................... 7 12/30/76 lVi 2/13/75 2-10 ....................................................................................................................... 9 Vi 12/30/76 10 2/13/75 10-100 ................................................................................................................... ll3/4 12/30/76 12 2/13/75 100-400 ................................................................................................................. 123/4 12/30/76 13 2/13/75 Over 400 ............................................................................................................... I6VS1 12/30/76 16 Vi 2/13/75 Time and savings2'3'4 3 3/16/67 3 Vi 3/2/67 Time5 0-5, by maturity 30-179 days ................................................................................................... 3 3/16/67 3 Vi 3/2/67 180 days to 4 years..................................................................................... 2 Vi 1/8/76 3 3/16/67 4 years or more ........................................................................................... 1 10/30/75 3 3/16/67 Over 5, by maturity 30-179 days................................................................................................... 6 12/12/74 5 10/1/70 180 days to 4 years..................................................................................... 2Vi 1/8/76 3 12/12/74 4 years or more ........................................................................................... 1 10/30/75 3 12/12/74 Legal limits Minimum Maximum Net demand Reserve city banks ......................................................................................... 10 22 Other banks ..................................................................................................... 7 14 3 10 Borrowings from foreign banks......................................................................... 0 22 1. For changes in reserve requirements beginning 1963, see Board’s Annual 4. The average reserve requirement on savings and other time deposits must be Statistical Digest, 1971-1975 and for prior changes, see Board’s Annual Report for at least 3 percent, the minimum specified by law. 1976, table 13. 5. Effective Nov. 2, 1978, a supplementary reserve requirement of 2 percent 2. (a) Requirement schedules are graduated, and each deposit interval applies was imposed on large time deposits of $100,000 or more, obligations of affiliates, to that part of the deposits of each bank. Demand deposits subject to reserve and ineligible acceptances. requirements are gross demand deposits minus cash items in process of collection Effective with the reserve maintenance period beginning Oct. 25, 1979, a mar­ ana demand balances due from domestic banks. ginal reserve requirement of 8 percent was added to managed liabilities in excess (b) The Federal Reserve Act specifies different ranges of requirements for of a base amount, with the maintenance period beginning Apr. 3, 1980, the rereserve city banks and for other banks. Reserve cities are designated under a Juirement was increased to 10 percent, ana with the maintenance period beginning criterion adopted effective Nov. 9, 1972, by which a bank having net demand une 12, 1980, it was decreased to 5 percent. Managed liabilities are defined as deposits of more than $400 million is considered to have the character of business large time deposits, Eurodollar borrowings, repurchase agreements against U.S. of a reserve city bank. The presence of the head office of such a bank constitutes government and federal agency securities, federal funds borrowings from non­ designation of that place as a reserve city. Cities in which there are Federal Reserve member institutions, and certain other obligations. In general, the base for the Banks or branches are also reserve cities. Any banks having net demand deposits marginal reserve requirement was originally the greater of (a) $100 million or (b) of $400 million or less are considered to have the character of business of banks the average amount of the managed liabilities held by a member bank, Edge outside of reserve cities and are permitted to maintain reserves at ratios set for corporation, or family of U.S. branches and agencies of a foreign bank for the two banks not in reserve cities. For details, see the Board’s Regulation D. statement weeks ending Sept. 26, 1979. For the computation period beginning (c) Effective Aug. 24, 1978, the Regulation M reserve requirements on net Mar. 20, 1980, the base was lowered by (a) 7 percent or (b) the decrease in an balances due from domestic banks to their foreign branches and on deposits that institution’s U.S. office gross loans to foreigners and gross balances due from foreign branches lend to U.S residents were reduced to zero from 4 percent and foreign offices of other institutions between the base period (Sept. 13-26, 1979) 1 percent, respectively. The Regulation D reserve requirement on borrowings and the week ending Mar. 12, 1980, whichever is greater. For the computation from unrelated banks abroad was also reduced to zero from 4 percent. eriod beginning May 29,1980, the base was increased by lYi percent above the (d) Effective with the reserve computation period beginning Nov. 16, 1978, ase used to calculate the marginal reserve in the statement week of May 14—21, domestic deposits of Edge corporations are subject to the same reserve require­ 1980. In addition, beginning Mar. 19, 1980, the base is reduced to the extent that ments as deposits of member banks. foreign loans and balances decline. The minimum base remains $100 million. 3. Negotiable order of withdrawal (NOW) accounts and time deposits such as Christmas and vacation club accounts are subject to the same requirements as Note. Required reserves must be held in the form of deposits with Federal savings deposits. Reserve banks or vault cash. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A9 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 May 31, 1980 Previous maximum In effect May 31, 1980 Previous maximum Percent Effective Effective Percent Effective Effective date date date date 1 Savings ................................................................................. 5K 7/1/79 7/1/73 5^ 7/1/79 5V4 2 Negotiable order of withdrawal accounts 2.................. 5 1/1/74 (3) 5 1/1/74 (3) Time accounts 4 Fixed ceiling rates by maturity 3 30-89 days....................................................................... 5V4 8/1/79 5 7/1/73 (3) 4 90 days to 1 year........................................................... 53/4 1/1/80 5Vi 7/1/73 6 1/1/80 53/4 O 5 6 2 1 t t o o 2 2 V y i e y ar e s a r 5 s . 5 .... . . . . . . . . . . . . .. .. . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7/1/73 5 5 3 V /4 i 1 1 / / 2 2 1 1 / / 7 7 0 0 6 Vi 0 } 1 1 / / 2 2 1 1 / / 7 7 0 0 7 2Vl to 4 years 5............................................................... 6 Vi 7/1/73 53/4 1/21/70 63/4 0) 6 1/21/70 8 4 to 6 years 6................................................................... IVa 11/1/73 iVi 11/1/73 (7) 9 6 to 8 years 6................................................................... IVi 12/23/74 IVa ll/i/73 73/4 12/23/74 IVi ll/i/73 10 8 years or more 6........................................................... 73/4 6/1/78 8 6/1/78 (3) 11 Issued to governmental units (all maturities)8........ 6/1/78 73/4 ' 12/23/74 8 6/1/78 73/4 ' 12/23/74 12 Individual retirement accounts and Keogh (H.R. 10) plans (3 years or more)8 9.................................... 6/1/78 73/4 7/6/77 8 6/1/78 73/4 7/6/77 Special variable ceiling rates by maturity 13 6-month money market time deposits10.................... (") (n) (") fin 14 2Vl years or more........................................................... M 1. July 1, 1973, for mutual savings banks; July 6, 1973, for savings and loan tutions were as follows: May 1, 10.790; May 8, 9.495; May 15, 9.000; May 22, associations. 9.000; and May 29, 8.003. [Note. Effective for all six-month money market cer­ 2. For authorized states only, federally insured commercial banks, savings and tificates issued beginning June 5, 1980, the interest rate ceilings will be determined loan associations, cooperative banks, and mutual savings banks in Massachusetts by the discount rate (auction average) of most recently issued six-month U.S. and New Hampshire were first permitted to offer negotiable order of withdrawal Treasury bills as follows: (NOW) accounts on Jan. 1, 1974. Authorization to issue NOW accounts was Bill rate Commercial bank ceiling Thrift ceiling extended to similar institutions throughout New England on Feb. 27, 1976, and 8.75 and above bill rate + Va percent bill rate + Va percent in New York State on Nov. 10, 1978, and in New Jersey on Dec. 28, 1979. 8.50 to 8.75 bill rate + Va percent 9.00 3. No separate account category. 7.50 to 8.50 bill rate -I- Va percent bill rate + Vi percent 4. For exceptions with respect to certain foreign time deposits see the Federal 7.25 to 7.50 7.75 bill rate + Vi percent Reserve Bulletin for October 1962 (p. 1279), August 1965 (p. 1084), and Feb­ Below 7.25 7.75 7.75 ruary 1968 (p. 167). The prohibition against compounding interest in these certificates continues. In 5. No minimum denomination. Until July 1, 1979, a minimum of $1,000 was addition, during the period May 29,1980, through Nov. 1,1980, commercial banks required for savings and loan associations, except in areas where mutual savings may renew maturing six-month money market time deposits for the same depositor banks permitted lower minimum denominations. This restriction was removed for at the thrift institution ceiling interest rate.] deposits maturing in less than 1 year, effective Nov. 1, 1973. 12. Effective Jan. 1, 1980, commercial banks, savings and loan associations, and 6. No minimum denomination. Until July 1, 1979, minimum denomination was mutual savings banks were authorized to offer variable-ceiling nonnegotiable time SI ,000 except for deposits representing funds contributed to an Individual Retire­ deposits with no required minimum denomination and with maturities of 2Vi years ment Account (IRA) or a Keogh (H.R. 10) plan established pursuant to the or more. The maximum rate for commercial banks is 3/4 percentage point below Internal Revenue Code. The $1,000 minimum requirement was removed for such the yield on 2Vi year U.S. Treasury securities; the ceiling rate for thrift institutions accounts in December 1975 and November 1976 respectively. is Va percentage point higher than that for commercial banks. Effective Mar. 1, 7. Between July 1, 1973, and Oct. 31, 1973, there was no ceiling for certificates 1980, a temporary ceiling of \\Va per cent was placed on these accounts at com­ maturing in 4 years or more with minimum denominations of $1,000; however, mercial banks; the temporary ceiling is 12 percent at savings and loan associations the amount of such certificates that an institution could issue was limited to 5 and mutual savings banks. [Note. Effective for all variable ceiling nonnegotiable percent of its total time and savings deposits. Sales in excess of that amount, as time deposits with maturities of 2Vi years or more issued beginning June 2, 1980, well as certificates of less than $1,000, were limited to the 6Vi percent ceiling on the ceiling rates of interest will be determined as follows: time deposits maturing in 2Vi years or more. Treasury yield Commercial bank ceiling Thrift ceiling Effective Nov. 1, 1973, ceilings were reimposed on certificates maturing in 4 12.00 and above 11.75 12.00 years or more with minimum denomination of $1,000. There is no limitation on 9.50 to 12.00 Treasury yield- Va percent Treasury yield the amount of these certificates that banks can issue. Below 9.50 9.25 9.50 8. Accounts subject to fixed rate ceilings. See footnote 6 for minimum denom­ Interest may be compounded on these time deposits. The ceiling rates of interest ination requirements. at which these accounts may be offered will vary biweekly.] 9. Effective January 1, 1980, commercial banks are permitted to pay the same 13. Between July 1, 1979, and Dec. 31, 1979, commercial banks, savings and rate as thrifts on IRA and Keogh accounts and accounts of governmental units loan associations, and mutual savings banks were authorized to offer variable when such deposits are placed in the new 2Vi year or more variable ceiling cer­ ceiling accounts with no required minimum denomination and with maturities of tificates or in 26-week money market certificates regardless of the level of the 4 years or more. The maximum rate for commercial banks was 1V4 percentage Treasury bill rate. points below the yield on 4-year U.S. Treasury securities; the ceiling rate for thrift 10. Must have a maturity of exactly 26 weeks and a minimum denomination of institutions was Va percentage point higher than that for commercial banks. $10,000, and must be nonnegotiable. Note. Before Mar. 31, 1980, the maximum rates that could be paid by federally 11. Commercial banks, savings and loan associations, and mutual savings banks insured commercial banks, mutual savings banks, and savings and loan associations were authorized to offer money market time deposits effective June 1, 1978. The were established by the Board of Governors of the Federal Reserve System, the ceiling rate for commercial banks on money market time deposits entered into Board of Directors of the Federal Deposit Insurance Corporation, and the Federal before June 5, 1980, is the discount rate (auction average) on most recently issued Home Loan Bank Board under the provisions of 12 CFR 217, 329, and 526, six-month U.S. Treasury bills. Until Mar. 15, 1979, the ceiling rate for savings respectively. Title II of the Depository Institutions Deregulation and Monetary and loan associations and mutual savings banks was Va percentage point higher Control Act of 1980 (P.L. 96-221) transferred the authority of the agencies to than the rate for commercial banks. Beginning March 15, 1979, the V^-percentage- establish maximum rates of interest payable on deposits to the Depository Insti­ point interest differential is removed when the six-month Treasury bill rate is 9 tutions Deregulation Committee. The maximum rates on time deposits in denom­ percent or more. The full differential is in effect when the six-month bill rate is inations of $100,000 or more with maturities of 30-89 days were suspended in June 8^4 per cent or less. Thrift institutions may pay a maximum 9 percent when the 1970; such deposits maturing in 90 days or more were suspended in May 1973. For six-month bill rate is between SVa and 9 percent. Also effective March 15, 1979, information regarding previous interest rate ceilings on all types of accounts, see interest compounding was prohibited on six-month money market time deposits earlier issues of the Federal Reserve Bulletin, the Federal Home Loan Bank at all offering institutions. The maximum allowable rates in May for commercial Board Journal, and the Annual Report of the Federal Deposit Insurance Corpo­ banks were as follows: May 1, 10.790; May 8, 9.495; May 15, 8.782; May 22, ration. 8.923; and May 29, 7.753. The maximum allowable rates in May for thrift insti­ Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

AlO Domestic Financial Statistics □ June 1980 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS Millions of dollars 1979 1980 Type of transaction 1977 1978 1979 Oct. Nov. Dec. Jan. Feb. Mar. Apr. U.S. Government Securities Outright transactions (excluding matched salepurchase transactions) Treasury bills 1 Gross purchases ................................................... 13,738 16,628 16,623 861 2,752 2,464 0 187 1,370 2,428 2 Gross sales ........................................................... 7,241 13,725 7,480 780 154 378 1,722 1,590 0 108 3 Exchange ............................................................... 0 0 0 0 0 0 0 0 0 0 4 Redemptions ......................................................... 2,136 2,033 2,900 300 300 0 790 400 0 0 Others within 1 year1 5 Gross purchases ................................................... 3,017 1,184 3,203 28 0 90 0 0 292 109 6 Gross sales ........................................................... 0 0 0 0 0 0 0 0 0 0 7 Maturity shift ....................................................... 4,499 -5,170 17,339 354 1,080 571 383 1,822 921 179 8 9 E R x e c d h e a m n p g t e i on .. s .. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . | 2,500 0 -11 2 , , 3 6 0 0 8 0 -1,138 0 -2,016 0 -727 0 -403 0 -2,177 0 -809 0 -459 0 1 to 5 years 10 Gross purchases ................................................... 2,833 4,188 2,148 35 0 398 0 0 355 373 11 Gross sales ........................................................... 0 0 0 0 0 0 0 0 0 0 12 Maturity shift ....................................................... | -6,649 -178 -12,693 -354 -1,080 -571 -383 -374 -921 -179 13 Exchange ............................................................... 7,508 1,138 1,302 727 403 1,377 809 459 5 to 10 years 14 Gross purchases ................................................... 758 1,526 523 0 0 81 0 0 107 62 15 Gross sales ........................................................... 0 0 0 0 0 0 0 0 0 0 1 17 6 M Ex a c t h u a ri n t g y e sh .. i . f . t . ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . j 584 2,803 -4 2 ,6 ,1 4 8 6 1 0 0 400 0 0 0 0 0 -1,3 4 6 5 4 0 0 0 0 0 Over 10 years 18 Gross purchases ................................................... 553 1,063 454 0 0 51 0 0 81 64 19 Gross sales .......................................................... 0 0 0 0 0 0 0 0 0 0 2 21 0 M Ex a c t h u a ri n t g y e sh .. i . f . t . ... . .. . . . . .. .. . . . . .. .. . . . . .. .. . . . . . . . . . . . . .. .. . . . . .. .. . . . . .. .. . . . . .. .. . . . . . . . . . . . . .. .. . . . . .. .. . . . . .. .. . . . . .. .. . . } 1,565 2,545 1,619 0 0 0 314 0 0 0 0 0 - 3 8 5 4 0 0 0 0 0 All maturities1 22 Gross purchases .................................................. 20,898 24,591 22,950 924 2,752 3,084 0 187 2,206 3,036 23 Gross sales .......................................................... 7,241 13,725 7,480 780 154 378 1,722 1,590 0 108 24 Redemptions ......................................................... 4,636 2,033 5,500 300 300 0 790 400 0 0 Matched sale-purchase transactions 25 Gross sales ........................................................... 425,214 511,126 626,403 58,656 45,204 53,681 53,025 54,541 55,658 57,316 26 Gross purchases .................................................. 423,841 510,854 623,245 58,671 45,979 49,738 55,557 54,584 54,636 57,479 Repurchase agreements 27 Gross purchases .................................................. 178,683 151,618 107,374 10,599 4,303 7,251 5,704 5,407 6,682 3,029 28 Gross sales ........................................................... 180,535 152,436 107,291 11,336 3,869 6,643 6,872 4,787 6,379 3,952 29Net change in U.S. government securities.......... 5,798 7,743 6,896 -878 3,507 -629 -1,148 -1,140 1,486 2,168 Federal Agency Obligations Outright transactions 30 Gross purchases .................................................. 1,433 301 853 0 0 0 0 0 0 668 3 31 2 R G e ro d s e s m p sa ti l o es n s ... . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . .. . . . 223 0 2 1 3 7 5 3 3 1 9 3 9 4 0 3 0 * 0 5 0 0 0 * 0 5 0 2 Repurchase agreements 33 Gross purchases .................................................. 13,811 40,567 37,321 5,146 1,992 2,383 3,049 2,403 1,883 483 34 Gross sales .......................................................... 13,638 40,885 36,960 6,188 1,075 2,863 3,543 2,372 1,834 563 35 Net change in federal agency obligations............ 1,383 -426 681 -1,045 917 -485 -494 31 45 586 Bankers Acceptances 36 Outright transactions, net...................................... -196 0 0 0 0 0 0 0 0 0 37 Repurchase agreements, net ................................ 159 -366 116 -735 -48 434 -704 205 -34 -171 38 Net change in bankers acceptances...................... -37 -366 116 -735 -48 434 -704 205 -34 -171 39 Total net change in System Open Market Account ......................................................... 7,143 6,951 7,693 -2,658 4,376 -679 -2,345 -903 1,497 2,582 1. Both gross purchases and redemptions include special certificates created Note. Sales, redemptions, and negative figures reduce holdings of the System when the Treasury borrows directly from the Federal Reserve, as follows (millions Open Market Account; all other figures increase such holdings. Details may not of dollars): September 1977, 2,500; March 1979, 2,600. add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Reserve Banks All 1.18 FEDERAL RESERVE BANKS Condition and Federal Reserve Note Statements Millions of dollars Wednesday End of month Account 1980 1980 Apr. 30p May Ip May 14p May 21 p May 28P Mar.P Apr.P MayP Consolidated condition statement Assets 1 Gold certificate account ..................................................... 11,172 11,172 11.172 11,172 11,172 11,172 11,172 11,172 2 Special drawing rights certificate account ...................... 2,968 2,968 2,968 2,968 2,968 2,968 2,968 2,968 3 Coin ....................................................................................... 387 382 388 394 383 415 387 401 Loans 4 Member bank borrowings.............................................. 4,770 927 1,585 886 2,400 2,502 4,770 602 5 Other ................................................................................. 0 0 0 0 0 0 0 0 Acceptances 6 Bought outright ............................................................... 0 0 0 0 0 0 0 0 7 Held under repurchase agreements ............................ 0 0 0 0 612 171 0 366 Federal agency obligations 8 Bought outright ...................................................................... 8,877 8,877 8,877 8,877 8,877 8,211 8,877 8,877 9 Held under repurchase agreements ............................ 0 0 0 0 924 80 0 353 U.S. government securities Bought outright 10 Bills ........................................................................................ 46,335 45,787 49,343 46,696 47,801 43,851 46,335 47,972 11 Certificates—Special ........................................................ 0 0 0 0 0 0 0 0 12 Notes ..................................................................................... 57,707 57,707 58.173 57,425 57,425 57,164 57,707 57,425 13 Bonds ..................................................................................... 14,783 14,783 14,938 15,974 15,974 14,719 14,783 15,974 14 TotaP ..................................................................................... 118.825 118.277 122.454 120.095 121,200 115,734 118.825 121,371 15 Held under repurchase agreements ............................... 0 0 0 0 3,002 923 0 2,906 16 Total U.S. government securities ........................................ 118.825 118.277 122.454 120.095 124,202 116,657 118.825 124,277 17 Total loans and securities ............................................... 132,472 128,081 132,916 129,858 137,015 127,621 132,472 134,475 18 Cash items in process of collection.................................. 10,595 10,897 10,267 11,093 11,586 8,949 10,595 8,386 19 Bank premises ..................................................................... 433 433 437 438 445 430 433 448 20 Denominated in foreign currencies2............................ 2,236 2,243 2,252 2,252 2,252 2,334 2,236 2,304 21 All other ................................................................................... 2,894 2,857 3,161 2,255 2,367 2,246 2,894 2,403 22 Total assets ...................................................................... 163,157 159,033 163,561 160,430 168,188 156,135 163,157 162,557 Liabilities 23 Federal Reserve notes......................................................... 111,524 112,403 112,742 112,791 113,622 110,597 111,524 113,118 Deposits Reserve accounts 24 Member banks ................................................................... 32,927 30,520 35,929 31,303 37,191 31,870 32,927 31,804 25 Edge Act corporations .................................................... 315 318 429 262 445 308 315 376 26 U.S. agencies and branches of foreign banks........ 40 69 133 125 127 92 40 202 27 Total........................................................................................ 33,282 30,907 36,491 31,690 37,763 32,270 33,282 32,382 28 Special Deposits—Credit Restraint Program ............. 171 201 222 274 555 0 171 550 29 U.S. Treasury—General account .................................... 4,561 3,367 2,080 3,119 2,297 2,334 4,561 4,523 30 Foreign—Official accounts ................................................. 648 409 351 350 383 468 648 380 31 Other ..................................................................................... 382 325 256 254 608 313 382 610 32 Total deposits .................................................................. 39,044 35,209 39,400 35,687 41,606 35,385 39,044 38,445 33 Deferred availability cash items ...................................... 7,523 6,455 6,490 7,085 7,981 5,267 7,523 5,911 34 Other liabilities and accrued dividends3.......................... 2,470 2,400 2,355 2,294 2,407 2,173 2,470 2,389 35 Total liabilities ................................................................ 160,561 156,467 160,987 157,857 165,616 153,422 160,561 159,863 Capital Accounts 36 Capital paid in ..................................................................... 1,162 1,162 1,163 1,164 1,164 1,159 1,162 1,164 37 Surplus ............................................................................................ 1,145 1,145 1,145 1,145 1,145 1,145 1,145 1,145 38 Other capital accounts ............................................................. 289 259 266 264 263 409 289 385 39 Total liabilities and capital accounts.................................... 163,157 159,033 163,561 160,430 168,188 156,135 163,157 162,557 40 Memo: Marketable U.S. government securities held in custody for foreign and international account........ 74,045 72,633 72,364 73,643 74,877 77,566 74,045 75,691 Federal Reserve note statement 41 Federal Reserve notes outstanding (issued to Bank) .. 130,478 130,746 130,946 131,328 131,380 128,418 130,478 131,334 Collateral held against notes outstanding 42 Gold certificate account ...................................................... 11,172 11,172 11,172 11,172 11,172 11,172 11,172 11,172 43 Special drawing rights certificate account.................... 2,968 2,968 2,968 2,968 2,968 2,968 2,968 2,968 44 Eligible paper .......................................................................... 1,613 138 707 145 435 1,665 1,613 42 45 U.S. government and agency securities......................... 114,725 116,468 116,099 117,043 116,805 112,613 114,725 117,152 46 Total collateral ................................................................ 130,478 130,746 130,946 131,328 131,380 128,418 130,478 131,334 1. Includes securities loaned—fully guaranteed by U.S. government securities 2. Beginning Dec. 29,1978, such assets are revalued monthly at market exchange pledged with Federal Reserve Banks—and excludes (if any) securities sold and rates. scheduled to be bought back under matched sale-purchase transactions. 3. Includes exchange-translation account reflecting, beginning Dec. 29, 1978, the monthly revaluation at market exchange rates of foreign-exchange commit­ ments. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A12 Domestic Financial Statistics □ June 1980 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holdings Millions of dollars Wednesday End of month Type and Maturity groupings 1980 1980 Apr. 30 May 7 May 14 May 21 May 28 Mar. 31 Apr. 30 May 31 1Loans, Total ......................................................................... 4,770 927 1,585 886 2,400 2,502 4,770 602 2 Within 15 days................................................................. 4,716 885 1,552 873 2,395 2,458 4,716 594 3 16 days to 90 days........................................................... 54 42 33 13 5 44 54 8 4 91 days to 1 year ............................................................. 0 0 0 0 0 0 0 0 5Acceptances—Total ............................................................. 0 0 0 0 612 171 0 366 6 Within 15 days................................................................. 0 0 0 0 612 171 0 366 7 16 days to 90 days........................................................... 0 0 0 0 0 0 0 0 8 91 days to 1 year ............................................................. 0 0 0 0 0 0 0 0 9U.S. Government securities—Total ................................ 118,825 118,277 122,454 120,095 124,202 116,657 118,825 124,277 10 Within 15 days* ............................................................... 7,519 8,388 11,219 3,341 6,623 4,238 7,519 4,821 11 16 days to 90 days........................................................... 22,179 21,497 22,519 26,727 26,543 25,319 22,179 28,363 12 91 days to 1 year ............................................................. 34,155 33,420 33,278 30,283 31,292 32,907 34,155 31,349 13 Over 1 year to 5 years.................................................. 29,784 29,784 30,051 32,298 32,298 29,131 29,784 32,298 14 Over 5 years to 10 years................................................ 12,029 12,029 12,073 13,437 13,437 11,967 12,029 13,437 15 Over 10 years................................................................... 13,159 13,159 13,314 14,009 14,009 13,095 13,159 14,009 16Federal Agency Obligations—Total................................ 8,877 8,877 8,877 8,877 9,801 8,291 8,877 9,230 17 Within 15 days1 ............................................................... 48 0 11 83 1,099 224 48 528 18 16 days to 90 days........................................................... 409 492 481 409 417 279 409 417 19 91 days to 1 year ............................................................. 1,627 1,592 1,592 1,592 1,612 1,478 1,627 1,612 20 Over 1 year to 5 years................................................... 4,778 4,778 4,778 4,778 4,670 4,337 4,778 4,670 21 Over 5 years to 10 years................................................. 1,271 1,271 1,271 1,271 1,259 1,253 1,271 1,259 22 Over 10 years................................................................... 744 744 744 744 744 720 744 744 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. 1979 1980 Bank o f g c r u o s u t p o , m o e r r type 1976 1977 1978 Dec. Jan. Feb. Mar. Apr. Debits to demand deposits1 (seasonally adjusted) 1 All commercial banks......................................................... 29,180.4 34,322.8 40,297.8 53,967.2 59.086.2 59,948.9 58,795.9 57,837.6 2 Major New York City banks............................................ 11.467.2 13,860.6 15,008.7 20.498.1 23,678.0 23,636.7 22,417.8 23,792.5 3 Other banks ......................................................................... 17.713.2 20,462.2 25,289.1 33.469.1 35.408.2 36,312.2 36,378.0 34,045.0 Debits to savings deposits2 (not seasonally adjusted) 4 All customers....................................................................... 174.0 417.7 724.3 856.2 760.4 826.8 888.6 5 Business3 ............................................................................... 21.7 56.7 88.1 92.8 79.4 85 5 87.0 6 Others ................................................................................... 152.3 361.0 636.2 763.4 681.0 741.4 801.6 Demand deposit turnover1 (seasonally adjusted) 7 All commercial banks......................................................... 116.8 129.2 139.4 172.4 189,1 191.9 188.9 196.2 8 Major New York City banks............................................ 411.6 503.0 541.9 684.0 763.4 760.6 721.3 805.9 9 Other banks ......................................................................... 79.8 85.9 96.8 118.2 125 8 129.1 129.8 128.3 Savings deposit turnover2 (not seasonally adjusted) 10 All customers ....................................................................... 1.6 1.9 3.6 4.3 3.9 4.3 4.7 11 Business3 ............................................................................... 4.1 5.1 8.4 9.3 8.2 9.4 10 1 12 Others ................................................................................... 1.5 1.7 3.4 4.0 3.6 4.0 4.5 1. Represents accounts of individuals, partnerships, and corporations, and of Note. Historical data—estimated for the period 1970 through June 1977, partly states and political subdivisions. on the basis of the debits series for 233 SMSAs, which were available through June 2. Excludes negotiable order of withdrawal (NOW) accounts and special club 1977—are available from Publications Services, Board of Governors of the Federal accounts, such as Christmas and vacation clubs. Reserve System, Washington, D.C. 20551. Debits and turnover data for savings 3. Represents corporations and other profit-seeking organizations (excluding deposits are not available prior to July 1977. commercial banks but including savings and loan associations, mutual savings banks, credit unions, the Export-Import Bank, and federally sponsored lending agencies). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Aggregates A13 1.21 MONEY STOCK MEASURES AND COMPONENTS Billions of dollars, averages of daily figures 1979 1980 Item D 19 e 7 c 6 . D 19 e 7 c 7 . D 19 e 7 c 8 . D 19 e 7 c 9 . Nov. Apr. Seasonally adjusted Measures1 1 M-1A .................................. 305.0 328.4 351.6 371.5 369.6 371.5 372.6 376.4' 375.4 369.6 2 M-1B .................................. 307.7 332.5 359.9 387.7 385.3 387.7 389.0' 392.8 392.4 387.6 3 M-2 ...................................... 1.166.7 1,294.1 1,400.8 1,524.2 1.514.5 1,524.2 1,532.8 1,546.5 1.551.4 1,548.0 4 M-3 ...................................... 1.299.7 1,460.3 1,622.2 1,773.6 1.762.6 1,773.6 1,785.3 1,804.2 1.809.5 1809.2 5 L2 ........................................ 1,523.5 1,715.5 1,926.3 2,139.0' 2,123.7C 2,139.0' 2,153.8' 2,176.3' 2,192.3 n.a. Components 6 Currency .......................... 80.7 88.7 97.6 106.1 105.9 106.1 107.3 108.2 108.9 109.0 7 Demand deposits .............. 224.4 239.7 253.9 265.4 263.7 265.4 265.3 268.1 266.5 260.6 8 Savings deposits .............. 447.7 486.5 476.0 417.7 422.2 417.7 412.9 405.2 394.0 380.7 9 Small time deposits3........ 396.6 454.9 533.8 653.8 645.8 653.8 659.5 669.6 684.0 702.2 10 Large time deposits4 118.0 145.2 194.7 219.1 218.3 219.1 222.2 228.1 230.7 233.8 Not seasonally adjusted Measures1 11 M-1A ......................................................... 313.5 337.2 360.9 381.1 372.2 381.1 377.4 368.1 368.5 372.9 12 M-1B ......................................................... 316.1 341.3 369.3 397.3 387.8 397.3 393.9 384.6 385.6 391.0 13 M-2 ............................................................. 1,169.1 1,295.9 1,402.9 1,526.0 1,509.9 1,526.0 1,536.1 1,538.4 1,548.2 1556.3 14 M-3 ............................................................. 1,303.8 1,464.5 1,627.8 1,779.0 1,759.1 1,779.0 1,790.6 1,796.2 1,807.2 1815.5 15 L2 ............................................................... 1,527.1 1,718.5 1,929.8 2,141.5' 2,122.1' 2,141.5' 2,160.5' 2,173.7 2,192.9 n.a. Components 16 Currency ................................................... 82.1 90.3 99.4 108.0 106.6 108.0 106.5 106.9 107.9 108.7 17 Demand deposits .................................... 231.3 247.0 261.5 273.1 265.6 273.1 270.9 261.2 260.6 264.2 18 Other checkable deposits5 .................... 2.7 4.1 8.3 16.2 15.7 16.2 16.5 16.5 17.0 18.0 19 Overnight RPs and Eurodollars6.......... 13.6 18.6 23.3 24.1 23.5 24.1 24.9 24.8' 23.2 19.7 20 Money market mutual funds................ 3.4 3.8 10.3 43.6 40.4 43.6 49.1 56.7 60.4 60.6 21 Savings deposits ...................................... 444.9 483.2 472.8 414.8 420.0 414.8 410.3 402.1 394.3 383.0 22 Small time deposits3................................ 393.5 451.3 529.8 648.8 640.8 648.8 660.6 672.8 687.3 704.8 23 Large time deposits4 .............................. 119.7 147.7 198.2 222.6' 219.5 222.6 224.1 228.2 231.5 231.8 1. Composition of the money stock measures is as follows: 2. L: M-3 plus other liquid assets such as term Eurodollars held by U.S. residents M-1A: Averages of daily figures for (1) demand deposits at all commercial banks other than banks, bankers acceptances, commercial paper, Treasury bills and other other than those due to domestic banks, the U.S. government, and foreign banks liquid Treasury securities, and U.S. savings bonds. and official institutions less cash items in the process of collection and Federal 3. Small time deposits are those issued in amounts of less than $100,000. Reserve float; and (2) currency outside the Treasury, Federal Reserve Banks, and 4. Large time deposits are those issued in amounts of $100,000 or more and are the vaults of commercial banks. net of the holdings of domestic banks, thrift institutions, the U.S. government, M-1B: M-l A plus negotiable order of withdrawal and automatic transfer service money market mutual funds, and foreign banks and official institutions. accounts at banks and thrift institutions, credit union share draft accounts, and 5. Includes ATS and NOW balances at all institutions, credit union share draft demand deposits at mutual savings banks. balances, and demand deposits at mutual savings banks. M-2: M-1B plus savings and small-denomination time deposits at all depositary 6. Overnight (and continuing contract) RPs are those issued by commercial institutions, overnight repurchase agreements at commercial banks, overnight banks to the nonbank public, and overnight Eurodollars are those issued by Ca­ Eurodollars held by U.S. residents other than banks at Caribbean branches of ribbean branches of member banks to U.S. nonbank customers. member banks, and money market mutual fund shares. Note. Latest monthly and weekly figures are available from the Board’s M-3: M-2 plus large-denomination time deposits at all depositary institutions H.6(508) release. Back data are available from the Banking Section, Division of and term RPs at commercial banks and savings and loan associations. Research and Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Financial Statistics □ June 1980 1.22 AGGREGATE RESERVES AND DEPOSITS Member Banks Billions of dollars, averages of daily figures 1979 1980 Item 1977 1978 1979 Dec. Dec. Dec. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. Seasonally adjusted 1 Reserves1................................................................................... 36.00 41.16 43.51 41.43 42.19 43.07 43.51 43.51 43.40 43.74 44.92 2 Nonborrowed ................................................................................. 35.43 40.29 42.03 40.09 40.17 41.16 42.03 42.27 41.74 40.91 42.47 3 Required......................................................................................... 35.81 40.93 43.11 41.24 41.92 42.83 43.11 43.16 43.20 43.48 44.64 4 Monetary base2 ............................................................................. 127.6 142.2 153.6 150.0 151.5 152.8 153.6 154.8 155.6 156.7' 158.0 5 Deposits subject to reserve requirements3.............................. 567.6 616.1 644.7 631.5 638.2 642.0 644.7 643.9 647.7 649.5 654.8 6 Time and savings........................................................................... 385.6 428.8 451.1 441.7 446.7 450.0 451.1 451.9 454.5' 457.9' 469.2 Demand 7 Private ......................................................................................... 178.5 185.1 191.9 188.1 189.8 190.0 191.9 189.6 191.3 189.9 188.1 8 U.S. government....................................................................... 3.5 2.2 1.8 1.7 1.7 1.9 1.8 2.4 1.9 1.8 2.4 Not seasonally adjusted 9 Monetary base2 ............................................................................. 129.8 144.6 156.2 149.4 151.3 153.5 156.2 156.1 154.0 154.9 157.6 10 Deposits subject to reserve requirements3.............................. 575.3 624.0 652.9 629.0 637.8 642.2 652.9 652.4 644.4r 648.4 657.0 11 Time and savings........................................................................... 386.4 429.6 452.0 439.4 445.8 449.1 452.0 454.6 455.8 460.6 464.7 Demand 12 Private ......................................................................................... 185.1 191.9 199.0 187.5 190.5 191.4 199.0 195.5 186.7 186.0 189.7 13 U.S. government....................................................................... 3.8 2.5 1.9 2.1 1.6 1.7 1.9 2.2 1.9 1.8 2.6 1. Member bank reserves series reflects actual reserves requirement percentages 3. Includes total time and savings deposits and net demand deposits as defined with no adjustment to eliminate the effect of changes in Regulations D and M. by Regulation D. Private demand deposits include all demand deposits except Effective Nov. 2, 1978, a supplementary reserve requirement of 2 percentage those due to the U.S. government, less cash items in process of collection and points was imposed on time deposits of $100,000 or more. This action increased demand balances due from domestic commercial banks. required reserves approximately $3.0 billion in the week beginning Nov. 16, 1978. Effective Oct. 11, 1979, an 8 percentage point marginal reserve requirement was Note. Latest monthly and weekly figures are available from the Board’s imposed on “managed liabilities”—liabilities that have been actively used to finance H.3(502) Release. Back data and estimates of the impact on required reserves and rapid expansion in bank credit. On Oct. 25,1979, reserves of Edge Act corporations changes in reserve requirements are available from the Banking Section, Division were included in member bank reserves. This action raised required reserves $318 of Research and Statistics. million. Effective Mar. 12, 1980, the marginal reserve requirement of 8 percentage points was raised to 10 percentage points. In addition the base upon which the marginal reserve requirement is calculated was reduced. 2. Includes total reserves (member bank reserve balances in the current week plus vault cash held two weeks earlier); currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of commercial banks; and vault cash of nonmember banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Aggregates A15 1.23 LOANS AND SECURITIES AH Commercial Banks' Billions of dollars; averages of Wednesday figures 1980 1980 1977 1978 1979 1977 1978 1979 Category Dec. Dec. Dec. Dec. Dec. Dec. Mar. Apr. Mar. Apr. Seasonally adjusted Not seasonally adjusted 1 Total loans and securities2....................... 891.1 1,014.33 1,132.54 1,165.2 1,161.0 899.1 1,023.83 1,143.04 1,159.0 1,158.3 2 U.S. Treasury securities .......................... 99.5 93.4 93.8 94.5 93.2 100.7 94.6 95.0 96.3 96.1 3 Other securities.......................................... 159.6 173.13 191.5 196.0 196.2 160.2 173.93 192.3 195.4 196.6 4 Total loans and leases2.............................. 632.1 747.83 847.24 874.7 871.6 638.3 755.43 855.74 867.3 865.6 5 Commercial and industrial loans........ 211.2s 246.56 290.5 4 302.7 301.3 212.6s 248.26 292.44 300.9 301.9 6 Real estate loans.................................... 175.2s 210.5 242.44 249.6 250.1 175.5s 210.9 242.94 248.1 248.9 7 Loans to individuals.............................. 138.2 164.9 182.7 184.4 182.2 139.0 165.9 183.8 181.6 179.9 8 Security loans ........................................ 20.6 19.4 18.3 16.8 16.5 22.0 20.7 19.6 16.7 16.2 9 Loans to nonbank financial institutions 25.8s 27.17 30.34 31.9 31.3 26.3s 27.67 30.84 31.1 30.9 10 Agricultural loans .................................. 25.8 28.2 31.0 32.0 32.2 25.7 28.1 30.8 31.4 31.7 11 Lease financing receivables.................. 5.8 7.4 9.5 10.1 10.2 5.8 7.4 9.5 10.1 10.2 12 All other loans ...................................... 29.5 43.63 42.6 47.4 48.0 31.5 46.63 45.9 47.4 46.1 Memo: 13 Total loans and securities plus loans sold2’9 ............................................... 895.9 1,018.13 1,135.34’® 1,167.8 1,163.6 903.9 1,027.63 1,145.74’8 1,161.6 1,160.9 14 Total loans plus loans sold2-9.................. 636.9 751.63 850.04-8 877.3 874.2 643.0 759.23 858.44-8 869.9 868.2 15 Total loans sold to affiliates9.................. 4.8 3.8 2.88 2.6 2.6 4.8 3.8 2.8s 2.6 2.6 16 Commercial and industrial loans plus loans sold9 .......................................... 213.9 s 248.56-10 292.34-8 304.3 303.0 215.3 s 250.16-10 294.24-8 302.6 303.5 17 Commercial and industrial loans sold9 2.7 1.9io 1.88 1.7 1.7 2.7 1.910 1.88 1.7 1.7 18 Acceptances held .................................. 7.5 6.8 8.5 8.0 8.5 8.6 7.5 9.4 8.1 8.2 19 Other commercial and industrial loans 203.7 s 239.7 282.0 294.7 292.9 203.9 s 240.9 283.1 292.8 293.7 20 To U.S. addressees11 ........................ 193.8s 226.6 263.2 274.2 272.8 193.7 s 226.5 263.2 272.8 273.9 21 To non-U.S. addressees.................... 9.9 s 13.1 18.8 20.5 20.0 10.3 s 14.4 19.8 20.0 19.8 22 Loans to foreign banks ............................ 13.5 21.2 18.7 19.7 9.7 14.6 23.0 20.1 19.2 19.1 23 Loans to commercial banks in the United States .................................. 54.1 57.3 77.8 78.8 83.7 56.9 60.3 81.9 81.4 86.8 1. Includes domestic chartered banks, U.S. branches, agencies, and New York 7. As of Dec. 1, 1978, nonbank financial loans were reduced $0.1 billion as the investment company subsidiaries of foreign banks; and Edge Act corporations. result of reclassification. 2. Excludes loans to commercial banks in the United States. 8. As of Dec. 1, 1979, loans sold to affiliates were reduced $800 million and 3. As of Dec. 31, 1978, total loans and securities were reduced by $0.1 billion. commercial and industrial loans sold were reduced $700 million due to corrections “Other securities” were increased by $1.5 billion and total loans were reduced by of two banks in New York City. $1.6 billion largely as the result of reclassifications of certain tax-exempt obliga­ 9. Loans sold are those sold outright to a bank’s own foreign branches, non­ tions. Most of the loan reduction was in “all other loans.” consolidated nonbank affiliates of the bank, the bank’s holding company (if not 4. As of Jan. 3, 1979, as the result of reclassifications, total loans and securities a bank), and nonconsolidated nonbank subsidiaries of the holding company. and total loans were increased by $0.6 billion. Business loans were increased by 10. As of Dec. 31, 1978, commercial and industrial loans sold outright were $0.4 billion and real estate loans by $0.5 billion. Nonbank financial loans were increased $0.7 billion as the result of reclassifications, but $0.1 billion of this reduced by $0.3 billion. amount was offset by a balance sheet reduction of $0.1 billion as noted above. 5. As of Dec. 31, 1977, as the result of loan reclassifications, business loans 11. United States includes the 50 states and the District of Columbia. were reduced by $0.2 billion and nonbank financial loans by $0.1 billion; real estate loans were increased by $0.3 billion. Note. Data are prorated averages of Wednesday data for domestic chartered 6. As of Dec. 31, 1978, commercial and industrial loans were reduced $0.1 banks, and averages of current and previous month-end data for foreign-related billion as a result of reclassifications. institutions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Financial Statistics □ June 1980 1.24 ASSETS AND LIABILITIES OF COMMERCIAL BANKING INSTITUTIONS Last-Wednesday-of-Month Series Billions of dollars except for number of banks 1979 1980 Account July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar/ Apr. May Domestically Chartered Commercial Banks1 1 Loans and investments ............................. 1,081.8 1,094.3 1,112.1 1,118.4 1,118.0 1,143.3 1,133.4 1,143.6 1,142.8 1,151.9 1,150.1 2 Loans, gross ................................................. 807.6 819.4 833.8 839.0 836.7 860.1 849.7 857.0 854.6 861.2 856.8 3 Interbank .................................................... 48.1 50.3 53.6 54.0 52.6 62.9 57.2 58.0 55.6 62.4 67.3 4 Commercial and industrial.................. 242.0 244.1 249.4 249.8 248.0 253.4 252.6 256.2 258.3 259.2 256.0 5 Other .......................................................... 517.4 525.0 530.9 535.3 536.1 543.7 540.0 542.9 540.7 539.6 533.5 6 U.S. Treasury securities ........................... 92.1 90.6 91.9 91.5 92.1 92.5 92.4 93.6 94.2 93.5 93.9 7 Other securities ........................................... 182.1 184.3 186.4 187.8 189.3 190.7 191.2 192.9 193.9 197.2 199.3 8 Cash assets, total ........................................ 140.2 145.7 148.5 160.7 158.1 146.4 148.4 149.9 153.8 168.2 172.4 9 Currency and coin .................................. 16.1 16.8 16.7 16.6 18.2 17.9 17.3 17.1 16.8 16.8 17.8 10 Reserves with Federal Reserve Banks 29.6 33.7 31.6 34.1 34.7 28.4 28.3 30.7 34.2 33.2 37.9 11 Balances with depositary institutions 41.2 41.1 40.7 45.5 43.7 37.7 43.7 43.4 43.1 49.7 47.9 12 Cash items in process of collection .. 53.4 54.1 59.5 64.6 61.5 62.4 59.0 58.7 59.8 68.6 68.8 13 Other assets.................................................... 53.9 53.8 57.5 57.8 59.3 61.2 63.1 65.0 66.1 73.3 72.8 14 Total assets/total liabilities and capital . 1,275.9 1,293.8 1,318.2 1,336.9 1,335.4 1,351.0 1,344.9 1,358.4 1,362.7 1,393.5 1,395.3 15 Deposits ..................................................... 975.2 982.9 996.6 1,023.6 1,017.6 1,030.6 1,022.5 1,028.9 1,032.1 1,060.0 1,056.9 16 Demand ...................................................... 352.6 352.4 358.7 376.6 365.1 377.6 362.4 358.7 354.5 377.4 370.1 17 Savings ........................................................ 218.3 216.6 213.4 207.6 205.0 203.4 200.6 199.9 196.5 189.3 192.4 18 Time ............................................................. 404.2 413.8 424.5 439.4 447.4 449.7 459.6 470.3 481.1 493.4 494.4 19 Borrowings .................................................... 137.2 140.1 147.0 137.4 135.6 140.5 143.1 145.1 142.1 147.0 154.1 20 Other liabilities............................................. 64.9 69.7 71.2 74.0 78.5 74.1 77.5 81.6 84.2 81.2 78.5 21 Residual (assets less liabilities) .............. 98.7 101.1 103.3 101.9 103.7 105.8 101.8 102.9 104.2 105.2 105.7 Memo: 22 U.S. Treasury note balances included in borrowing............................................... 11.9 8.6 17.8 8.4 5.0 12.8 15.0 8.1 9.4 14.3 5.1 23 Number of banks......................................... 14,584 14,607 14,616 14,605 14,608 14,610 14,594 14,609 14,626 14,629 14,639 All Commercial Banking Institutions2 24 Loans and investments ............................. 1,153.1 1,169.8 1,197.7 1,200.3 1,200.9 1,229.8 1,217.7 1,230.8 1,231.8 1,240.9 25 Loans, gross ............................................ 876.2 892.1 915.9 917.6 916.2 943.1 930.7 941.0 940.2 946.8 26 Interbank .............................................. 60.6 63.8 69.2 71.6 71.8 80.5 75.4 78.3 75.2 82.1 27 Commercial and industrial ................ 276.9 280.5 288.1 288.3 287.9 295.0 295.1 298.5 301.7 302.0 28 Other .................................................... 538.6 547.8 558.6 557.7 556.6 567.6 560.1 564.2 563.4 562.7 29 U.S. Treasury securities ........................ 93.5 91.9 93.5 93.1 93.7 94.5 94.3 95.5 96.2 95.5 30 Other securities ........................................... 183.5 185.8 188.3 189.5 190.9 192.2 192.7 194.4 195.4 198.6 31 Cash assets, total ........................................ 160.4 166.0 172.2 179.9 176.7 169.5 166.5 168.8 174.0 187.3 32 Currency and coin .................................. 16.1 16.8 16.7 16.6 18.2 17.9 17.3 17.1 16.8 16.8 33 Reserves with Federal Reserve Banks 30.4 34.5 32.5 34.9 35.6 29.0 28.9 31.3 35.0 33.9 34 Balances with depositary institutions 59.3 59.3 62.4 62.5 60.0 59.0 59.8 60.5 61.1 66.6 35 Cash items in process of collection .. 54.7 55.3 60.6 65.9 62.9 63.7 60.4 60.0 61.2 69.9 36 Other assets.............................................. 69.7 70.9 76.7 76.5 78.5 81.0 83.7 86.8 91.6 99.0 37 Total assets/total liabilities and capital . 1,383.2 1,406.7 1,446.5 1,456.7 1,456.1 1,480.3 1,468.0 1,486.5 1,497.5 1,527.2 n.a. 38 Deposits .................................................... 1,012.3 1,020.9 1,043.6 1,062.6 1,058.5 1,076.3 1,063.1 1,070.0 1,073.5 1,101.1 39 Demand ...................................................... 369.7 369.1 383.2 394.2 384.9 400.5 380.5 376.8 373.6 396.6 40 Savings ........................................................ 219.1 217.6 214.2 208.3 205.9 204.3 201.3 200.3 196.7 189.5 41 Time ............................................................. 432.5 434.2 446.2 460.1 467.7 471.5 481.3 492.9 503.2 515.0 42 Borrowings .................................................... 165.8 169.5 182.1 171.6 169.5 180.5 179.5 182.9 186.5 190.8 43 Other liabilities............................................. 104.4 113.1 115.2 118.5 122.2 115.4 121.1 128.4 130.9 127.8 44 Residual (assets less liabilities) .............. 100.8 103.2 105.6 104.0 105.8 108.1 104.2 105.2 106.5 107.4 Memo: 45 U.S. Treasury note balances included in borrowing............................................... 11.9 8.6 17.8 8.4 5.0 12.8 15.0 8.1 9.4 14.3 46 Number of banks........................................ 14,933 14,960 14,972 14,963 14,969 14,975 14,962 14,978 14,995 15,004 1. Domestically chartered commercial banks include all commercial banks in the Note. Figures are partly estimated. They include all bank-premises subsidiaries United States except branches of foreign banks; included are member and non­ and other significant majority-owned domestic subsidiaries. Data for domestically member banks, stock savings banks, and nondeposit trust companies. chartered commercial banks are for the last Wednesday of the month; data for 2. Commercial banking institutions include domestically chartered commercial other banking institutions are for last Wednesday except at end of quarter, when banks, branches and agencies of foreign banks, Edge Act and Agreement cor­ they are for the last day of the month. porations, and New York state foreign investment corporations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A17 1.25 COMMERCIAL BANK ASSETS AND LIABILITIES Call-Date Series Millions of dollars, except for number of banks 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 Loans and investments, gross .......................................... 827,696 854,733 914,779 956,431 476,610 488,240 523,000 542,218 Loans 2 Gross ................................................................................. 578,734 601,122 657,509 695,443 340,691 351,311 384,722 403,812 3 Net ..................................................................................... 560,077 581,143 636,318 672,207 329,971 339,955 372,702 390,630 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 80,583 86,033 87,886 6 Cash assets ....................................................................... 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................................................................................. 825,003 847,372 922,657 945,874 469,377 476,381 520,167 526,932 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 ................................................................................. 285,200 284,544 319,873 312,707 163,346 161,358 181,821 176,025 Time and savings 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 ......................................................... 75,061 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 investment, gross............................................. 144,000 144,597 152,514 157,464 207,085 221,896 239,265 256,749 Loans 18 Gross ................................................................................. 102,277 102,117 110,243 115,736 135,766 147,694 162,543 175,894 19 Net ..................................................................................... 99,474 99,173 107,205 112,470 130,630 142,015 156,411 169,106 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 Total assets/total liabilities1................................................. 189,579 195,452 210,442 217,384 231,086 245,748 267,910 284,221 24 Deposits................................................................................. 149,491 152,472 163,436 167,403 206,134 218,519 239,053 251,539 Demand 25 U.S. government ............................................................. 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 52,570 57,605 55,550 69,648 70,615 80,445 81,131 Time and savings 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 Total capital accounts ......................................................... 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 Loans and investments, gross ........................................... 18,819 22,940 24,415 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 ..................................................................................... 16,209 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 Deposits................................................................................. 13,325 14,658 16,844 19,924 219,460 233,177 255,898 271,463 Demand 41 U.S. government ............................................................. 4 8 10 8 921 822 1,907 2,323 42 Interbank........................................................................... 1,277 1,504 1,868 2,067 2,896 3,025 3,718 3,736 43 Other ................................................................................. 3,236 3,588 4,073 4,814 72,884 74,203 84,518 85,946 Time and savings 44 Interbank........................................................................... 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 Borrowings ........................................................................... 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 Domestic Financial Statistics □ June 1980 1.26 COMMERCIAL BANK ASSETS AND LIABILITIES Detailed Balance Sheet, September 30, 1978 Millions of dollars, except for number of banks Member banks1 Insured Non­ Asset account commercial Large banks member banks Total All other banks1 New York City of Other City Chicago large 1 Cash bank balances, items in process ................................................ 158,380 134,955 43,758 5,298 47,914 37,986 23,482 2 Currency and coin............................................................................... 12,135 8,866 867 180 2,918 4,901 3,268 3 Reserves with Federal Reserve Banks............................................ 28,043 28,041 3,621 1,152 12,200 11,067 3 4 Demand balances with banks in United States.............................. 41,104 25,982 12,821 543 3,672 8,945 15,177 5 Other balances with banks in United States.................................. 4,648 2,582 601 15 648 1,319 2,066 6 Balances with banks in foreign countries...................................... 3,295 2,832 331 288 1,507 705 463 7 Cash items in process of collection.................................................. 69,156 66,652 25,516 3,119 26,969 11,049 2,504 8 Total securities held—Book value ....................................................... 262,199 179,877 20,808 7,918 58,271 92,881 82,336 9 U.S. Treasury....................................................................................... 95,068 65,764 9,524 2,690 22,051 31,499 29,315 10 Other U.S. government agencies .................................................... 40,078 25,457 1,828 1,284 7,730 14,616 14,622 11 States and political subdivisions ....................................................... 121,260 85,125 9,166 3,705 27,423 44,831 36,136 12 All other securities ............................................................................. 5,698 3,465 291 240 1,048 1,887 2,234 13 94 66 19 47 28 14 Trading-account securities ................................................................. 6,833 6,681 3,238 708 2,446 290 151 15 U.S. Treasury................................................................................... 4,125 4,103 2,407 408 1,210 78 23 16 Other U.S. government agencies ................................................ 825 816 401 82 278 55 9 17 States and political subdivisions .................................................. 1,395 1,381 363 117 794 107 14 18 All other trading account securities............................................ 394 316 67 101 145 3 78 19 94 66 19 47 28 20 Bank investment portfolios ............................................................... 255,366 173,196 17,570 7,210 55,825 92,591 82,185 21 U.S. Treasury................................................................................... 90,943 61,661 7,117 2,282 20,840 31,422 29,293 22 Other U.S. government agencies ................................................ 39,253 24,641 1,426 1,201 7,452 14,561 14,613 23 States and political subdivisions .................................................. 119,865 83,745 8,803 3,588 26,629 44,724 36,123 24 All other portfolio securities ........................................................ 5,305 3,149 224 138 903 1,884 2,156 25 Federal Reserve stock and corporate stock ...................................... 1,656 1,403 311 111 507 475 253 26 Federal funds sold and securities resale agreement.......................... 41,258 31,999 3,290 1,784 16,498 10,427 9,365 27 Commercial banks ............................................................................... 34,256 25,272 1,987 1,294 12,274 9,717 9,090 28 Brokers and dealers ........................................................................... 4,259 4,119 821 396 2,361 541 140 29 Others ................................................................................................... 2,743 2,608 482 94 1,863 169 135 30 Other loans, gross ................................................................................... 675,915 500,802 79,996 26,172 190,565 204,069 175,113 31 Less: Unearned income on loans........................................................ 17,019 11,355 675 107 3,765 6,809 5,664 32 Reserves for loan loss................................................................. 7,431 5,894 #1,347 341 2,256 1,949 1,537 33 Other loans, net....................................................................................... 651,465 483,553 77,974 25,724 184,544 195,311 167,912 Other loans, gross, by category 34 Real estate loans ..................................................................................... 203,386 138,730 10,241 2,938 52,687 72,863 64,656 35 Construction and land development................................................ 25,621 19,100 2,598 685 9,236 6,581 6,521 36 Secured by farmland........................................................................... 8,418 3,655 23 34 453 3,146 4,763 37 Secured by residential properties .................................................... 117,176 81,370 5,362 1,559 31,212 43,236 35,806 38 1- to 4-family residences................................................................. 111,674 77,422 4,617 1,460 29,774 41,570 34,252 39 FHA-insured or VA-guaranteed.............................................. 7,503 6,500 508 44 3,446 2,502 1,003 40 Conventional ............................................................................... 104,171 70,922 4,109 1,417 26,328 39,068 33,249 41 Multifamily residences ................................................................... 5,502 3,948 746 99 1,438 1,665 1,554 42 FHA-insured................................................................................. 399 340 132 27 88 92 59 43 Conventional ............................................................................... 5,103 3,609 613 72 1,350 1,573 1,495 44 Secured by other properties............................................................... 52,171 34,605 2,258 660 11,786 19,901 17,566 45 Loans to financial institutions............................................................... 37,072 34,843 12,434 4,342 15,137 2,930 2,228 46 REITs and mortgage companies...................................................... 8,574 8,162 2,066 801 4,616 680 412 47 Domestic commercial banks ............................................................ 3,362 2,618 966 165 1,206 281 744 48 Banks in foreign countries................................................................. 7,359 7,187 3,464 268 2,820 635 171 49 Other depositary institutions ............................................................. 1,579 1,411 290 76 785 261 167 50 Other financial institutions................................................................. 16,198 15,465 5,649 3,033 5,710 1,073 733 51 Loans to security brokers and dealers................................................ 11,042 10,834 6,465 1,324 2,846 199 207 52 Other loans to purchase or carry securities........................................ 4,280 3,532 410 276 1,860 985 747 53 Loans to farmers except real estate.................................................... 28,054 15,296 168 150 3,781 11,196 12,758 54 Commercial and industrial loans.......................................................... 213, 123 171,815 39,633 13,290 67,833 51,059 41,309 55 Loans to individuals ............................................................................... 161,599 110,974 7,100 2,562 40,320 60,993 50,624 56 Installment loans ................................................................................. 131,571 90,568 5,405 1,711 33,640 49,811 41,003 57 Passenger automobiles ................................................................... 58,908 37,494 1,077 209 11,626 24,582 21,414 58 Residential repair and modernization ............ ........................ 8,526 5,543 331 60 2,088 3,064 2,983 59 Credit cards and related plans...................................................... 21,938 19,333 2,268 1,267 9,736 6,062 2,605 60 Charge-account credit cards...................................................... 17,900 16,037 1,573 1,219 8,192 5,053 1,863 61 Check and revolving credit plans ............................................ 4,038 3,296 695 47 1,545 1,009 742 62 Other retail consumer goods......................................................... 19,689 13,296 427 57 5,242 7,570 6,393 63 Mobile homes............................................................................... 9,642 6,667 179 19 2,563 3,905 2,976 64 Other ............................................................................................. 10,047 6,629 249 38 2,678 3,664 3,417 65 Other installment loans ................................................................. 22,510 14,902 1,302 119 4,948 8,533 7,608 66 Single-payment loans to individuals ................................................ 30,027 20,406 1,694 851 6,680 11,182 9,621 67 All other loans......................................................................................... 17,360 14,778 3,545 1,290 6,100 3,844 2,582 68 Total loans and securities, net........................................................... 956,579 696,833 102,383 35,536 259,820 299,094 259,867 69 Direct lease financing ............................................................................. 6,717 6,212 1,145 96 3,931 1,041 505 70 Fixed assets—Buildings, furniture, real estate.................................. 22,448 16,529 2,332 795 6,268 7,133 5,926 71 Investment in unconsolidated subsidiaries.......................................... 3,255 3,209 1,642 188 1,282 96 46 72 Customer acceptances outstanding....................................................... 16,557 16,036 8,315 1,258 6,054 409 521 73 Other assets ............................................................................................. 34,559 30,408 11,323 1,000 12,810 5,275 4,249 74 Total assets ......................................................................................... 1,198,495 904,182 170,899 44,170 338,079 351,034 294,595 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A19 1.26 Continued Member banks1 Insured Non­ Liability or capital account commerical Large banks member banks Total All other banks1 New York City of Other City Chicago large 75 Demand deposits ..................................................................................... 369,030 282,450 66,035 10,690 100,737 104,988 86,591 76 Mutual savings banks ......................................................................... 1,282 1,089 527 1 256 305 194 77 Other individuals, partnerships, and corporations........................ 279,651 205,591 31,422 7,864 79,429 86,876 74,061 78 U.S. government ................................................................................. 7,942 5,720 569 188 1,987 2,977 2,222 79 States and political subdivisions ...................................................... 17,122 11,577 764 252 3,446 7,116 5,545 80 Foreign governments, central banks, etc........................................ 1,805 1,728 1,436 19 211 62 77 81 Commercial banks in United States................................................ 39,596 38,213 21,414 1,807 10,803 4,189 1,393 82 Banks in foreign countries................................................................. 7,379 7,217 5,461 207 1,251 298 162 83 Certified and officers’ checks, etc.................................................... 14,253 11,315 4,443 352 3,354 3,166 2,937 84 Time deposits ........................................................................................... 368,562 266,496 38,086 15,954 98,525 113,931 102,066 85 Accumulated for personal loan payments...................................... 79 66 0 0 1 65 13 86 Mutual savings banks ......................................................................... 399 392 177 40 148 27 7 87 Other individuals, partnerships, and corporations........................ 292,120 210,439 29,209 12,074 76,333 92,824 81,680 88 U.S. government ................................................................................. 864 689 61 40 356 232 175 89 States and political subdivisions ...................................................... 59,087 40,010 1,952 1,554 16,483 20,020 19,077 90 Foreign governments, central banks, etc........................................ 6,672 6,450 3,780 1,145 1,401 124 222 91 Commercial banks in United States................................................ 7,961 7,289 2,077 999 3,585 629 672 92 Banks in foreign countries................................................................. 1,381 1,161 829 103 219 9 220 93 Savings deposits ....................................................................................... 223,326 152,249 10,632 2,604 54,825 84,188 71,077 94 Individuals and nonprofit organizations.......................................... 207,701 141,803 9,878 2,448 51,161 78,316 65,897 95 Corporations and other profit organizations.................................. 11,216 7,672 519 148 3,195 3,809 3,544 96 U.S. government ................................................................................. 82 65 2 3 24 35 17 97 States and political subdivisions ...................................................... 4,298 2,682 215 4 437 2,025 1,616 98 All other ............................................................................................... 30 27 18 * 8 2 3 99 Total deposits ..................................................................................... 960,918 701,195 114,753 29,248 254,087 303,107 259,733 100 Federal funds purchased and securities sold under agreements to repurchase ................................................................................... 91,981 85,582 21,149 8,777 41,799 13,857 6,398 101 Commercial banks ............................................................................... 42,174 39,607 6,991 5,235 21,609 5,773 2,566 102 Brokers and dealers ........................................................................... 12,787 11,849 2,130 1,616 6,381 1,722 939 103 Others ................................................................................................... 37,020 34,126 12,028 1,926 13,809 6,362 2,894 104 Other liabilities for borrowed money.................................................. 8,738 8,352 3,631 306 3,191 1,225 386 105 Mortgage indebtedness ........................................................................... 1,767 1,455 234 27 701 491 316 106 Bank acceptances outstanding.............................................................. 16,661 16,140 8,398 1,260 6,070 412 521 107 Other liabilities ....................................................................................... 27,124 23,883 8,600 1,525 9,020 4,477 3,494 108 Total liabilities ................................................................................... 1,107,188 836,607 157,026 41,144 314,868 323,569 270,849 109 Subordinated notes and debentures.................................................... 5,767 4,401 1,001 79 2,033 1,287 1,366 110 Equity capital ........................................................................................... 85,540 63,174 12,871 2,947 21,177 26,178 22,380 Ill Preferred stock..................................................................................... 88 36 0 0 5 31 52 112 Common stock ..................................................................................... 17,875 12,816 2,645 570 4,007 5,594 5,064 113 Surplus................................................................................................... 32,341 23,127 4,541 1,404 8,148 9,034 9,217 114 Undivided profits................................................................................. 33,517 26,013 5,554 921 8,680 10,858 7,509 115 Other capital reserves......................................................................... 1,719 1,182 132 52 337 661 538 116 Total liabilities and equity capital..................................................... 1,198,495 904,182 170,899 44,170 338,079 351,034 294,595 Memo: 117 Demand deposits adjusted2 ................................................................... 252,337 171,864 18,537 5,576 60,978 86,774 80,472 Average for last 15 or 30 days 118 Cash and due from bank ....................................................................... 146,283 124,916 36,862 6,030 45,731 36,293 21,379 119 Federal funds sold and securities purchased under agreements to resell ................................................................................................. 43,873 33,682 4,272 1,887 16,007 11,517 10,307 120 Total loans ............................................................................................... 651,874 483,316 76,750 25,722 184,790 196,054 168,558 121 Time deposits of $100,000 or more .................................................... 183,614 150,160 32,196 13,216 65,776 38,972 33,454 122 Total deposits........................................................................................... 944,593 687,543 107,028 28,922 250,804 300,789 257,062 123 Federal funds purchased and securities sold under agreements to repurchase ......................................................................................... 92,685 86,635 22,896 9,473 40,541 13,725 6,053 124 Other liabilities for borrowed money.................................................. 8,716 8,326 3,679 370 3,211 1,067 390 125 Standby letters of credit outstanding.................................................. 18,820 17,658 10,063 1,477 4,820 1,297 1,162 126 Time deposits of $100,000 or more .................................................... 186,837 152,553 32,654 13,486 66,684 39,728 34,284 127 Certificates of deposit......................................................................... 160,227 129,667 27,950 11,590 56,383 33,743 30,560 128 Other time deposits............................................................................. 26,610 22,886 4,704 1,896 10,301 5,985 3,724 129 Number of banks..................................................................................... 14,390 5,593 12 9 153 5,419 8,810 1. Member banks exclude and nonmember banks include 13 noninsured trust Note. Data include consolidated reports, including figures for all bank-premises companies that are members of the Federal Reserve System. subsidiaries and other significant majority-owned domestic subsidiaries. Securities 2. Demand deposits adjusted are demand deposits other than domestic com­ are reported on a gross basis before deductions of valuation reserves. Back data mercial interbank and U.S. government, less cash items reported as in process of in lesser detail were shown in previous issues of the Bulletin. collection. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 Domestic Financial Statistics □ June 1980 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 1980 Account Apr. 2 Apr. 9 Apr. 16 Apr. 23 Apr. 30 May 7 May 14 May 21 May 28 1 Cash items in process of collection............................ 55,312 49,679 53,850 49,637 56,425 49,875 52,586 47,651 56,919 2 Demand deposits due from banks in the United States ....................................................................... 19,107 19,421 17,431 16,331 20,855 20,136 17,205 17,565 18,660 3 All other cash and due from depository institutions 29,457 29,439 33,182 32,811 33,903 31,959 37,409 33,098 39,076 4 Total loans and securities.......................................... 523,583 524,575 520,976 517,470 520,604 516,857 514,749 514,931 515,874 Securities 5 U.S. Treasury securities ............................................... 34,673 36,815 36,671 35,095 35,289 34,392 33,757 35,420 35,574 6 Trading account ......................................................... 5,296 7,478 7,411 6,110 5,929 4,961 4,608 5,098 4,819 7 Investment account, by maturity............................ 29,377 29,337 29,260 28,985 29,360 29,430 29,149 30,322 30,755 8 One year or less..................................................... 6,952 7,018 7,018 6,918 6,823 6,514 6,056 6,027 6,352 9 Over one through five years.............................. 17,880 17,803 17,735 17,497 18,065 18,327 18,485 19,555 19,554 10 Over five years....................................................... 4,545 4,516 4,508 4,570 4,472 4,589 4,608 4,740 4,849 11 Other securities ............................................................. 71,986 72,687 72,876 72,972 74,535 74,412 75,990 75,223 75,347 12 Trading account ......................................................... 2,642 3,328 3,106 2,938 4,070 3,729 5,042 4,265 3,823 13 Investment account ................................................... 69,344 69,359 69,770 70,034 70,465 70,683 70,947 70,958 71,524 14 U.S. government agencies .................................. 15,681 15,664 15,708 15,756 15,918 16,128 16,349 16,374 16,577 15 States and political subdivision, by maturity ... 51,061 51,111 51,489 51,703 51,968 51,958 52,004 52,006 52,369 16 One year or less................................................. 6,020 6,148 6,266 6,201 6,499 6,524 6,507 6,273 6,526 17 Over one year..................................................... 45,041 44,962 45,223 45,502 45,469 45,434 45,497 45,733 45,843 18 Other bonds, corporate stocks and securities .. 2,602 2,584 2,573 2,575 2,578 2,596 2,594 2,577 2,578 Loans 19 Federal funds sold1 ....................................................... 25,010 27,419 24,838 24,776 24,655 25,390 23,500 24,600 25,116 20 To commercial banks ............................................... 19,478 19,876 20,017 20,584 20,608 20,914 19,805 21,136 21,913 21 To nonbank brokers and dealers in securities----- 3,579 4,302 3,670 3,016 3,016 3,256 2,784 2,572 2,286 22 To others..................................................................... 1,953 3,240 1,150 1,177 1,032 1,220 910 891 916 23 Other loans, gross ......................................................... 404,541 400,369 399,372 397,453 398,908 395,496 394,382 392,578 392,720 24 Commercial and industrial ....................................... 161,830 161,302 161,162 160,119 160,167 159,048 158,124 156,885 157,049 25 Bankers acceptances and commercial paper ... 3,740 3,787 4,097 3,886 4,355 4,598 4,728 4,617 4,911 26 All other ................................................................. 158,091 157,514 157,064 156,233 155,812 154,450 153,396 152,268 152,138 27 U.S. addressees ................................................. 151,951 151,367 150,973 150,122 149,674 148,437 147,448 146,441 146,338 28 Non-U.S. addressees ......................................... 6,140 6,147 6,091 6,110 6,138 6,013 5,948 5,827 5,799 29 Real estate ..................................................................... 103,209 103,512 103,800 103,986 104,194 104,274 104,537 104,770 104,822 30 To individuals for personal expenditures.............. 72,947 72,654 72,591 72,516 72,253 71,839 71,544 71,300 71,167 To financial institutions 31 Commercial banks in the United States............ 4,114 3,808 3,495 3,155 3,577 3,524 3,416 3,405 3,440 32 Banks in foreign countries.................................. 6,757 6,855 6,259 6,707 6,817 6,728 6,613 7,009 7,343 33 Sales finance, personal finance companies, etc . 10,593 9,567 9,502 9,051 8,962 8,742 8,628 8,388 8,560 34 Other financial institutions.................................. 16,933 16,809 16,155 16,067 16,073 15,896 15,340 15,238 14,946 35 To nonbank brokers and dealers in securities .... 7,082 5,668 6,432 6,028 6,700 5,644 6,746 6,089 5,585 36 To others for purchasing and carrying securities2 2,388 2,358 2,346 2,330 2,316 2,282 2,298 2,297 2,310 37 To finance agricultural production ........................ 4,983 4,937 4,982 4,987 5,009 5,029 5,031 5,055 5,028 38 All other ..................................................................... 13,706 12,898 12,648 12,508 12,841 12,490 12,105 12,142 12,470 39 Less: Unearned income ............................................... 7,251 7,318 7,367 7,413 7,340 7,342 7,361 7,374 7,358 40 Loan loss reserve .............................................. 5,377 5,395 5,414 5,414 5,444 5,491 5,519 5,517 5,525 41 Other loans, net............................................................. 391,914 387,655 386,591 384,626 386,124 382,663 381,502 379,687 379,837 42 Lease financing receivables ........................................ 8,378 8,340 8,349 8,388 8,443 8,481 8,524 8,527 8,540 43 All other assets............................................................... 69,223 68,423 66,999 68,057 69,809 69,571 71,308 71,627 71,325 44 Total assets ................................................................ 705,060 699,878 700,787 692,694 710,039 696,879 701,782 693,399 710,393 Deposits 45 Demand deposits ........................................................... 201,657 195,093 198,113 187,396 201,141 188,583 189,251 185,913 194,939 46 Mutual savings banks .............................................. 909 772 779 644 761 717 637 563 680 47 Individuals, partnerships, and corporations.......... 139,544 134,938 138,151 131,557 134,330 128,111 130,963 125,838 132,372 48 States and political subdivisions ............................ 4,760 4,492 4,957 4,778 5,975 4,775 4,454 4,812 4,581 49 U.S. government ....................................................... 972 955 1,680 1,687 2,424 974 734 863 1,811 50 Commercial banks in the United States................ 34,760 34,891 34,097 31,541 37,596 34,968 32,885 34,589 35,553 51 Banks in foreign countries...................................... 9,419 8,926 8,253 7,905 8,745 8,911 8,672 9,649 9,951 52 Foreign governments and official institutions .... 1,902 2,146 2,208 1,736 2,837 2,306 1,778 1,963 1,616 53 Certified and officers’ checks.................................. 9,391 7,973 7,987 7,546 8,474 7,821 9,127 7,636 8,374 54 Time and savings deposits .......................................... 276,175 277,981 277,308 278,310 278,010 278,930 279,126 278,742 278,738 55 Savings ......................................................................... 71,208 70,981 70,174 69,243 68,456 68,726 68,829 69,230 69,686 56 Individuals and nonprofit organizations............ 67,205 66,985 66,289 65,381 64,583 64,823 64,865 65,219 65,546 57 Partnerships and corporations operated for profit................................................................. 3,372 3,387 3,258 3,261 3,230 3,278 3,320 3,380 3,492 58 Domestic governmental units.............................. 620 597 617 591 632 616 631 620 639 59 All other ................................................................. 10 13 9 10 10 10 13 11 9 60 Time ............................................................................. 204,967 207,000 207,134 209,067 209,554 210,203 210,297 209,511 209,052 61 Individuals, partnerships, and corporations----- 171,839 173,508 173,405 175,188 176,017 176,521 176,995 176,483 175,625 62 States and political subdivisions ........................ 21,978 21,973 21,836 21,865 21,511 21,651 21,404 21,228 21,045 63 U.S. government ................................................... 370 376 392 373 402 384 360 357 343 64 Commercial banks in the United States............ 5,984 6,092 6,204 6,286 6,322 6,295 6,215 6,122 5,952 65 Foreign governments, official institutions, and banks ............................................................... 4,795 5,051 5,297 5,355 5,301 5,352 5,323 5,322 6,086 Liabilities for borrowed money 66 Borrowings from Federal Reserve Banks............ 1,139 1,071 2,691 1,817 3,596 713 1,487 810 2,265 67 Treasury tax-and-loan notes.................................... 228 220 4,615 5,702 10,650 3,561 2,388 4,312 3,080 68 All other liabilities for borrowed money3............ 108,189 110,707 104,908 106,102 103,285 111,633 116,506 110,143 120,574 69 Other liabilities and subordinated note and debentures ............................................................... 70,900 67,961 66,476 66,521 66,197 66,260 65,770 66,363 63,575 70 Total liabilities ........................................................... 658,288 653,032 654,112 645,849 662,878 649,680 654,528 646,282 663,170 71 Residual (total assets minus total liabilities)4.......... 46,772 46,845 46,676 46,846 47,160 47,199 47,254 47,116 47,223 4 1. Includes securities purchased under agreements to resell. 4. This is not a measure of equity capital for use in capital adequacy analysis 2. Other than financial institutions and brokers and dealers. or for other analytic uses. 3. Includes federal funds purchased and securities sold under agreements to repurchase; for information on these liabilities at banks with assets of $1 billion or more on Dec. 31, 1977, see table 1.13. 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 Account Apr. 2 Apr. 9 Apr. 16 Apr. 23 Apr. 30 May 7 May 14 May 21 May 28 1Cash items in process of collection.............................................. 52,696 47,427 50,945 46,810 53,398 47,178 50,142 45,376 54,079 2Demand deposits due from banks in the United States.......... 18,466 18,697 16,772 15,818 20,177 19,499 16,600 16,887 17,882 3 All other cash and due from depository institutions................ 27,679 27,699 31,167 30,716 31,732 30,100 35,128 31,237 37,066 4Total loans and securities........................................................... 489,293 489,665 486,296 482,934 486,265 482,317 480,634 480,623 481,598 Securities 5 U.S. Treasury securities ................................................................. 32,203 34,340 34,221 32,643 32,855 31,978 31,312 32,948 33,096 6 Trading account ........................................................................... 5,212 7,390 7,335 6,046 5,858 4,892 4,527 5,020 4,755 7 Investment account, by maturity.............................................. 26,990 26,951 26,885 26,597 26,997 27,086 26,785 27,928 28,341 8 One year or less....................................................................... 6,425 6,497 6,504 6,418 6,366 6,056 5,602 5,602 5,913 9 Over one through five years................................................ 16,401 16,323 16,242 15,989 16,532 16,814 16,949 17,996 17,999 10 Over five years......................................................................... 4,165 4,131 4,139 4,190 4,099 4,216 4,234 4,331 4,429 11 Other securities ............................................................................... 66,226 66,919 67,096 67,139 68,572 68,455 70,005 69,261 69,388 12 Trading account ........................................................................... 2,566 3,230 2,990 2,812 3,939 3,599 4,917 4,137 3,694 13 Investment account ............................................. .................... 63,660 63,689 64,106 64,328 64,633 64,856 65,088 65,124 65,694 14 U.S.government agencies....................................................... 14,562 14,568 14,619 14,635 14,753 14,965 15,166 15,230 15,442 15 States and political subdivision, by maturity...................... 46,659 46,701 47,077 47,281 47,467 47,461 47,496 47,484 47,841 16 One year or less................................................................... 5,525 5,650 5,764 5,695 5,900 5,928 5,921 5,682 5,895 17 Over one year....................................................................... 41,134 41,050 41,312 41,586 41,566 41,533 41,574 41,802 41,946 18 Other bonds, corporate stocks and securities.................... 2,439 2,420 2,409 2,411 2,413 2,430 2,427 2,410 2,410 Loans 19Federal funds sold1 ......................................................................... 22,768 24,477 22,100 22,304 22,461 22,877 21,435 22,271 22,760 20 To commercial banks ................................................................. 17,675 17,583 17,779 18,481 18,766 18,787 18,061 19,000 19,776 21 To nonbank brokers and dealers in securities...................... 3,180 3,693 3,210 2,687 2,688 2,921 2,497 2,399 2,084 22 To others....................................................................................... 1,914 3,201 1,111 1,136 1,007 1,169 877 872 900 23 Other loans, gross........................................................................... 379,774 375,687 374,700 372,717 374,203 370,883 369,801 368,080 368,280 24 Commercial and industrial......................................................... 153,656 153,081 152,923 151,818 151,882 150,823 149,906 148,729 148,918 25 Bankers’ acceptances and commercial paper.................... 3,654 3,706 4,015 3,797 4,274 4,532 4,658 4,539 4,810 26 All other ................................................................................... 150,002 149,375 148,908 148,021 147,607 146,291 145,247 144,190 144,108 27 U.S. addressees ................................................................... 143,912 143,285 142,870 141,962 141,520 140,329 139,349 138,415 138,361 28 Non-U.S. addressees........................................................... 6,091 6,090 6,038 6,059 6,087 5,962 5,898 5,775 5,747 29 Real estate ................................................................................... 96,997 97,313 97,587 97,748 97,964 98,039 98,305 98,532 98,563 30 To individuals for personal expenditures................................ 64,419 64,196 64,128 64,078 63,848 63,446 63,186 62,961 62,833 To financial institutions 31 Commercial banks in the United States.............................. 4,031 3,727 3,412 3,074 3,499 3,448 3,339 3,328 3,361 32 Banks in foreign countries.................................................... 6,692 6,795 6,196 6,640 6,750 6,658 6,550 6,930 7,276 33 Sales finance, personal finance companies, etc................ 10,428 9,406 9,332 8,876 8,782 8,556 8,445 8,214 8,400 34 Other financial institutions.................................................... 16,517 16,401 15,760 15,678 15,698 15,516 14,967 14,870 14,578 35 To nonbank brokers and dealers in securities...................... 6,991 5,579 6,376 5,974 6,639 5,582 6,668 6,017 5,533 36 To others for purchasing and carrying securities2................ 2,172 2,142 2,131 2,112 2,101 2,070 2,082 2,075 2,090 37 To finance agricultural production.......................................... 4,825 4,780 4,820 4,824 4,848 4,868 4,878 4,896 4,869 38 All other ....................................................................................... 13,043 12,266 12,034 11,893 12,192 11,877 11,474 11,527 11,858 39 Less: Unearned income ................................................................. 6,619 6,681 6,727 6,770 6,706 6,709 6,726 6,740 6,726 40 Loan loss reserve................................................................. 5,060 5,077 5,094 5,099 5,120 5,166 5,194 5,198 5,200 41 Other loans, net............................................................................... 368,096 363,929 362,879 360,848 362,377 359,007 357,881 356,143 356,353 42 Lease financing receivables ........................................................... 8,149 8,112 8,121 8,156 8,208 8,244 8,287 8,288 8,299 43 All other assets ............................................................................... 67,222 66,503 65,072 66,078 67,744 67,534 69,280 69,631 69,290 44Total assets ................................................................................. 663,505 658,104 658,374 650,511 667,526 654,873 660,071 652,042 668,215 Deposits 45 Demand deposits ............................................................................. 189,573 183,459 185,737 175,359 188,814 176,977 177,910 174,598 182,863 46 Mutual savings banks ................................................................. 869 743 746 620 725 684 608 537 654 47 Individuals, partnerships, and corporations .......................... 129,852 125,530 128,317 122,289 124,829 118,999 121,770 116,880 123,052 48 States and political subdivisions .............................................. 4,249 3,967 4,412 4,162 5,357 4,140 3,932 4,214 3,997 49 U.S. government ......................................................................... 877 863 1,330 1,060 1,914 718 666 766 1,660 50 Commercial banks in the United States.................................. 33,387 ' 33,656 32,840 30,388 36,309 33,745 31,674 33,284 34,067 51 Banks in foreign countries........................................................ 9,365 8,871 8,204 7,850 8,691 8,854 8,616 9,586 9,891 52 Foreign governments and official institutions........................ 1,902 2,142 2,207 1,735 2,836 2,294 1,778 1,962 1,609 53 Certified and officer’s checks.................................................... 9,074 7,686 7,680 7,254 8,153 7,542 8,866 7,368 7,932 54Time and savings deposits ............................................................. 256,727 258,454 257,900 258,875 258,676 259,527 259,686 259,295 259,292 55 Savings........................................................................................... 65,844 65,616 64,861 64,002 63,298 63,526 63,625 64,000 64,422 56 Individuals and nonprofit organizations.............................. 62,150 61,934 61,290 60,444 59,712 59,930 59,970 60,290 60,596 57 Partnerships and corporations operated for profit............ 3,125 3,136 3,024 3,022 2,992 3,034 3,076 3,132 3,234 58 Domestic governmental units .............................................. 559 533 538 526 583 552 567 566 582 59 All other ................................................................................... 9 13 9 10 10 10 13 11 9 60 Time............................................................................................... 190,883 192,838 193,039 194,873 195,378 196,000 196,061 195,295 194,871 61 Individuals, partnerships, and corporations ...................... 160,054 161,658 161,583 163,246 164,038 164,471 164,937 164,440 163,617 62 States and political subdivisions .......................................... 19,972 19,953 19,861 19,909 19,617 19,796 19,530 19,366 19,190 63 U.S. government ..................................................................... 356 362 378 359 388 370 345 343 329 64 Commercial banks in the United States.............................. 5,706 5,814 5,920 6,003 6,035 6,011 5,925 5,824 5,649 65 Foreign governments, official institutions, and banks----- 4,795 5,051 5,297 5,355 5,301 5,352 5,323 5,322 6,086 Liabilities for borrowed money 66 Borrowings from Federal Reserve Banks.............................. 1,037 928 2,607 1,767 3,504 713 1,487 810 2,255 67 Treasury tax-and-loan notes....................................................... 203 194 4,347 5,334 9,974 3,296 2,202 4,025 2,845 68 All other liabilities for borrowed money3.............................. 102,756 104,703 99,083 100,275 97,755 105,430 110,375 104,362 114,715 69 Other liabilities and subordinated note and debentures---- 69,577 66,656 65,162 65,175 64,802 64,896 64,337 64,988 62,180 70Total liabilities ............................................................................ 619,873 614,394 614,836 606,785 623,524 610,838 615,997 608,078 624,150 71 Residual (total assets minus total liabilities)4............................ 43,632 43,710 43,538 43,726 44,001 44,034 44,074 43,964 44,065 1. Includes securities purchased under agreements to resell. 4. This is not a measure of equity capital for use in capital adequacy analysis 2. Other than financial institutions and brokers and dealers. or for other analytic uses. 3. Includes federal funds purchased and securities sold under agreement to repurchase; for information on these liabilities at banks with assets of $1 billion or more on Dec. 31, 1977, see table 1.13. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 Domestic Financial Statistics □ June 1980 1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1980 Account Apr. 2 Apr. 9 Apr. 16 Apr. 23 Apr. 30 May 7 May 14 May 21 May 28 1 Cash items in process of collection.............................................. 19.332 18,652 18,614 18,466 20,987 18,546 20,568 17,570 21,118 2 Demand deposits due from banks in the United States.......... 13,218 13,353 12,004 11,228 15,445 14,676 12,308 12,380 13,073 3 All other cash and due from depository institutions................ 6,624 8,049 8,533 8,149 10,030 8,274 10,078 8,236 10,431 4 Total loans and securities1 ......................................................... 116,135 112,806 112,683 111,704 112,551 111,869 111,598 115,124 112,816 Securities 6 7 Investment account, by maturity.............................................. 5,907 5,907 5,850 5,640 5,752 5,716 5,504 6,647 6,827 8 One year or less....................................................................... 1,001 1,001 979 919 866 772 466 704 760 9 Over one through five years................................................ 4,244 4,244 4,203 3,997 4,268 4,307 4,412 5,216 5,269 10 Over five years......................................................................... 662 662 667 724 617 638 626 727 798 11 P 13 Investment account ..................................................................... 12,445 12,372 12,454 12,489 12,571 12,758 12,958 12,991 13,284 14 U.S. government agencies .................................................... 2,423 2,415 2,472 2,493 2,496 2,502 2,610 2,670 2,742 15 States and political subdivision, by maturity...................... 9,421 9,350 9,373 9.380 9,459 9,637 9,727 9,697 9,914 16 One year or less................................................................... 1,490 1,450 1,436 1,399 1,467 1,605 1,612 1,449 1,640 17 Over one year....................................................................... 7,931 7,899 7,937 7,981 7,993 8,032 8,115 8,248 8,274 18 Other bonds, corporate stocks and securities.................... 600 606 609 616 615 620 621 623 628 Loans 19 Federal funds sold3 ......................................................................... 7.356 6,119 6,785 6,350 6,381 7,219 6,572 9,726 6,145 20 To commercial banks ................................................................ 5,370 3,674 4,974 4,779 4,836 5,660 4,993 8,218 4,530 21 To nonbank brokers and dealers in securities...................... 1,225 1,021 1,423 1,220 1,226 1,130 1,291 1,257 1,222 22 To others....................................................................................... 761 1,424 387 351 319 430 288 251 393 23 Other loans, gross ........................................................................... 93,102 91,110 90,326 89,977 90,576 88,935 89,340 88,548 89,347 24 Commercial and industrial ........................................................ 48,005 47,696 47,464 47,030 47,144 46,794 46,899 46,230 46,451 25 Bankers’ acceptances and commercial paper .................... 1,239 1,379 1,660 1,588 1,874 2,171 2,007 2,068 1,949 26 All other ................................................................................... 46,765 46,317 45,804 45,442 45,271 44,623 44,892 44,163 44,501 27 U.S. addressees .................................................................. 44,800 44,366 43,849 43,455 43,258 42,671 42,943 42,318 42,625 28 Non-U.S. addressees .......................................................... 1,966 1,951 1,955 1,987 2,012 1.952 1,950 1,845 1,876 29 Real estate ................................................................................... 12,723 12,805 12,892 12,941 12,997 12,972 13,085 13,167 13,176 30 To individuals for personal expenditures................................ 8,751 8,770 8,799 8,837 8,870 8,856 8,847 8,840 8,838 To financial institutions 31 Commercial banks in the United States.............................. 1,767 1,925 1,490 1,470 1,578 1,520 1,465 1,451 1,596 32 Banks in foreign countries.................................................... 3,120 3,376 2,760 3,173 3,050 2,911 2,977 3,443 3,816 33 Sales finance, personal finance companies, etc................... 4,528 3,835 3,919 3,730 3,667 3,619 3,565 3,504 3,648 34 Other financial institutions.................................................... 5,570 5,340 5,079 4,991 5,126 5,095 4,877 4,955 4,789 35 To nonbank brokers and dealers in securities...................... 3,990 3,197 3,975 3,830 4,018 3,227 3,925 3,362 3,193 36 To others for purchasing and carrying securities4................ 421 397 390 388 375 361 372 373 371 37 To finance agricultural production .......................................... 302 290 290 290 286 293 293 288 285 38 AH other ....................................................................................... 3,924 3,477 3,268 3,298 3,464 3,286 3,035 2,933 3,184 39 Less: Unearned income ................................................................ 1,023 1,044 1,066 1,079 1,057 1,073 1,071 1,081 1,084 40 Loan loss reserve ................................................................ 1,651 1,657 1,666 1,673 1,672 1,686 1,705 1,706 1,704 41 Other loans, net............................................................................... 90,427 88,408 87,594 87,225 87,847 86,175 86,564 85,761 86,559 42 Lease financing receivables .......................................................... 1,607 1,606 1,602 1,606 1,624 1,631 1,638 1,637 1,638 43 All other assets5............................................................................... 31,009 32,160 29,863 29,654 30,645 30,102 31,445 31,762 31,017 44 Total assets ................................................................................. 187,925 186,626 183,299 180,808 191,282 185,099 187,634 186,710 190,092 Deposits 45 Demand deposits ............................................................................. 66,898 65,926 63,547 61,262 69,669 64,894 64,474 64,405 66,993 46 Mutual savings banks ................................................................ 496 442 449 303 353 365 296 267 342 47 Individuals, partnerships, and corporations .......................... 33,144 32,664 31,500 31,140 32,026 30,168 30,457 29,700 31,730 48 States and political subdivisions .............................................. 400 395 523 363 527 398 416 545 427 49 U.S. government ........................................................................ 118 197 420 350 411 135 127 153 390 50 Commercial banks in the United States.................................. 20,038 20,586 19,421 18,633 23,691 21,327 20,056 21,092 20,574 51 Banks in foreign countries........................................................ 7,245 6,992 6,380 5,946 6,593 6,951 6,787 7,612 7,897 52 Foreign governments and official institutions........................ 1,158 1,417 1,437 986 2,068 1,534 1,022 1,188 1,323 53 Certified and officers’ checks.................................................... 4,298 3,234 3,417 3,540 4,000 4,014 5,313 3,846 4,311 54Time and savings deposits ............................................................ 46,832 47,686 47,923 48,328 48,352 48,863 49,147 48,904 48,837 55 Savings ........................................................................................... 9,320 9,328 9,338 9,129 9,013 8,976 8,923 8,991 9,088 56 Individuals and nonprofit organizations.............................. 8,897 8,921 8,941 8,739 8,587 8,567 8,517 8,564 8,644 57 Partnerships and corporations operated for profit............ 291 288 280 278 277 280 282 290 298 58 Domestic governmental units .............................................. 127 112 113 107 143 125 117 131 142 59 All other .................................................................................. 4 7 3 4 5 4 6 6 4 60 Time ............................................................................................... 37,512 38,358 38,584 39,199 39,340 39,887 40,224 39,913 39,749 61 Individuals, partnerships, and corporations ...................... 31,646 32,252 32,467 33,021 33,234 33,645 34,044 33,712 33,542 62 States and political subdivisions .......................................... 1,588 1,599 1,552 1,630 1,611 1,674 1,635 1,640 1,637 63 U.S. government .................................................................... 63 56 79 80 73 69 73 73 70 64 Commercial banks in the United States.............................. 1,543 1,605 1,554 1,547 1,519 1,598 1,570 1,598 1,513 65 Foreign governments, official institutions, and banks .... 2,672 2.845 2,932 2,922 2,901 2,901 2,903 2,889 2,987 Liabilities for borrowed money 66 Borrowings from Federal Reserve Banks .............................. 125 1,360 310 640 625 335 67 Treasury tax-and-loan notes...................................................... 2 1 1,659 1,333 2,481 823 549 1,036 674 68 All other liabilities for borrowed money6.............................. 33,724 34,354 30,268 31,619 32,225 31,609 34,834 33,087 35,989 69 Other liabilities and subordinated note and debentures.......... 26,026 24,350 24,297 23,732 23,450 24,479 23,560 24,860 22,740 70 Total liabilities ........................................................................... 173,607 172,317 169,053 166,585 176,818 170,668 173,190 172,293 175,569 71 Residual (total assets minus total liabilities)7............................ 14,318 14,309 14,246 14,223 14,464 14,431 14,444 j 14,417 14,524 1. Excludes trading account securities. 5. Includes trading account securities. 2. Not available due to confidentiality. 6. Includes federal funds purchased and securities sold under agreements to 3. Includes securities purchased under agreements to resell. repurchase. 4. Other than financial institutions and brokers and dealers. 7. This is not a measure of equity capital for use in capital adequacy 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 1980 Apr. 2 Apr. 9 Apr. 16 Apr. 23 Apr. 30 May 7 May 14 May 21 May 28 Banks with Assets of $750 Million or More 1 Total loans (gross! and securities adjusted1 .................................. 512,620 513,604 510,245 506,558 509,203 505,251 504,408 503,281 503,404 2 Total loans (gross) adjusted1 ............................................................... 405,960 404,103 400,698 398,491 399,378 396,448 394,661 392,637 392,482 3 Demand deposits adjusted2 ................................................................. 110,613 109,567 108,486 104,530 104,696 102,766 103,045 102,810 100,655 4 Time deposits in accounts of $100,000 or more........................... 132,324 133,480 132,978 134,159 134,670 134,941 135,006 134,220 133,840 5 Negotiable CDs ................................................................................... 93,508 94,492 94,194 95,185 95,624 95,499 95,775 95,138 94,572 6 Other time deposits............................................................................ 38,815 38,988 38,784 38,974 39,046 39,442 39,232 39,082 39,268 7 Loans sold outright to affiliates3........................................................ 2,580 2,581 2,678 2,600 2,633 2,555 2,594 2,736 2,661 8 Commercial and industrial............................................................... 1,666 1,679 1,764 1,693 1,645 1,614 1,696 1,834 1,750 9 Other ....................................................................................................... 914 902 914 908 988 942 898 903 911 Banks with Assets of $1 Billion or More 10 Total loans (gross) and securities adjusted1 .................................. 479,265 480,113 476,927 473,248 475,827 471,958 471,154 470,233 470,386 11 Total loans (gross) adjusted1 ............................................................... 380,836 378,853 375,610 373,466 374,400 371,525 369,836 368,024 367,902 12 Demand deposits adjusted2 ................................................................. 102,614 101,513 100,622 97,102 97,192 95,336 95,428 95,172 93,057 13 Time deposits in accounts of $100,000 or more........................... 123,980 125,109 124,719 125,904 126,411 126,662 126,721 125,940 125,589 14 Negotiable CDs ................................................................................... 87,218 88,178 87,985 88,971 89,403 89,292 89,578 89,122 88,586 15 Other time deposits............................................................................ 36,762 36,931 36,734 36,933 37,008 37,370 37,142 36,818 37,004 16 Loans sold outright to affiliates3........................................................ 2,541 2,541 2,640 2,559 2,592 2,514 2,556 2,698 2,621 17 Commercial and industrial............................................................... 1,638 1,651 1,737 1,665 1,618 1,586 1,672 1,809 1,723 18 Other ....................................................................................................... 903 890 902 894 974 928 884 889 898 Banks in New York City 19 Total loans (gross) and securities adjusted1-4 ............................... 111,673 109,908 108,950 108,207 108,867 107,450 107,916 108,242 109,477 20 Total loans (gross) adjusted1 ............................................................... 93,321 91,630 90,646 90,078 90,544 88,975 89,454 88,604 89,366 21 Demand deposits adjusted2 ................................................................. 27,410 26,492 25,092 23,812 24,580 24,885 23,723 25,588 24,912 22 Time deposits in accounts of $100,000 or more........................... 28,980 29,545 29,662 30,115 30,221 30,665 31,007 30,663 30,562 23 Negotiable CDs ................................................................................... 20,471 21,063 21,240 21,690 21,805 22,156 22,527 22,277 22,312 24 Other time deposits............................................................................ 8,509 8,482 8,421 8,425 8,416 8,509 8,480 8,386 8,250 1. Exclusive of loans and federal funds transactions with domestic commercial 3. Loans sold are those sold outright to a bank’s own foreign branches, non­ banks. consolidated nonbank affiliates of the bank, the bank’s holding company (if not 2. All demand deposits except U.S. government and domestic banks less cash a bank), and nonconsolidated nonbank subsidiaries of the holding company. items in process of collection. 4. Excludes trading account securities. NOTES TO TABLE 1.311. 1. Commercial banks are those in the 50 states and the District of Columbia and averages of current and previous month-end data for foreign-related institu­ with national or state charters plus U.S. branches, agencies, and New York in­ tions. vestment company subsidiaries of foreign banks and Edge Act corporations. 4. Loans initially booked by the bank and later sold to affiliates that are still 2. Includes seasonally adjusted federal funds, RPs, and other borrowings from held by affiliates. Averages of Wednesday data. nonbanks and not seasonally adjusted net Eurodollars and loans to affiliates. 5. As of Dec. 1, 1979, loans sold to affiliates were reduced $800 million due to Includes averages of Wednesday data for domestic chartered banks and averages corrections of two New York City banks. of current and previous month-end data for foreign-related institutions. 6. Includes averages of daily figures for member banks and quarterly call report 3. Other borrowings are borrowings on any instrument, such as a promissory figures for nonmember banks. note or due bill, given for the purpose of borrowing money for the banking business. 7. Includes averages of current and previous month-end data until August 1979; This includes borrowings from Federal Reserve Banks and from foreign banks, beginning September 1979 averages of daily data. term federal funds, overdrawn due from bank balances, loan RPs, and partici­ 8. Based on daily average data reported by 122 large banks beginning February pations in pooled loans. Includes averages of daily figures for member banks 1980 and 46 banks before February 1980. 9. Includes U.S. Treasury demand deposits and Treasury tax-and-loan notes at commercial banks. Averages of daily data. 10. Averages of Wednesday figures. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 Domestic Financial Statistics □ June 1980 1.31 LARGE WEEKLY REPORTING COMMERCIAL BANKS Domestic Classified Commercial and Industrial Loans Millions of dollars Outstanding Net change during Adjust­ Industry classification 1980 1979 1980 ment bank Jan. 30 Feb. 27 Mar. 26 Apr. 30 May 28 Q4 Ql Mar. Apr. May 1 Durable goods manufacturing.............. 23,735 24,237 24,961 23,981 22,833 1 1,322 724 -980 -1,148 46 2 Nondurable goods manufacturing........ 19,116 19,302 19,824 18,690 18,075 298 580 522 -1,134 -615 39 3 Food, liquor, and tobacco.................. 4,941 4,885 4,923 4,176 3,859 314 -302 38 -747 -317 6 4 Textiles, apparel, and leather .......... 4,138 4,331 4,480 4,614 4,668 -686 132 149 134 53 6 5 Petroleum refining ............................... 3,175 3,111 3,139 2,618 2,490 705 461 28 -521 -129 1 6 Chemicals and rubber ........................ 3,714 3,714 3,911 3,903 3,761 209 61 197 -8 -142 14 7 Other nondurable goods.................... 3,148 3,260 3,370 3,379 3,299 -243 229 110 9 -80 12 8 Mining (including crude petroleum and natural gas) .............................. 12,323 12,479 12,596 13,272 13,588 317 585 117 676 316 14 9 Trade ......................................................... 24,576 25,184 25,456 25,399 24,833 230 450 272 -57 -566 121 10 Commodity dealers ............................ 2,136 2,171 1,816 1,784 1,639 275 -323 -354 -32 -144 6 11 Other wholesale .................................. 11,705 11,938 12,097 12,043 11,645 52 71 159 -54 -398 34 12 Retail ..................................................... 10,735 11,076 11,543 11,572 11,549 -96 702 468 29 -23 82 13 Transportation, communication, and other public utilities................ 18,027 17,884 18,292 18,832 18,507 1,070 448 407 540 -325 14 14 Transportation ..................................... 7,173 7,238 7,516 7,692 7,543 300 376 278 176 -150 7 15 Communication..................................... 2,619 2,630 2,747 2,846 2,800 197 224 117 99 -46 1 16 Other public utilities .......................... 8,236 8,016 8,028 8,293 8,164 574 -152 12 265 -130 5 17 Construction ............................................. 5,783 5,772 5,874 5,902 5,832 -114 73 102 28 -70 23 18 Services ..................................................... 19,846 19,964 20,211 20,444 19,977 1,040 715 247 234 -468 % 19 All other1................................................... 15,100 15,220 15,028 15,000 14,715 94 -77 -192 -28 -284 288 20 Total domestic loans................................ 138,505 140,043 142,242 141,520 138,361 2,935 4,096 2,199 -722 -3,160 641 21 Memo: Term loans (original maturity more than 1 year) included in do­ mestic loans....................................... 74,744 74,780 76,026 76,221 74,889 4,077 3,544 1,246 195 -1,332 33 1. Includes commercial and industrial loans at a few banks with assets of $1 Note. New series. The 134 large weekly reporting commercial banks with dobillion or more that do not classify their loans. mestic assets of $1 billion or more as of December 31, 1977, are included in this series. The revised series is on a last-Wednesday-of-the-month basis. 1.311 MAJOR NONDEPOSIT FUNDS OF COMMERCIAL BANKS1 Monthly averages, billions of dollars December outstanding Outstanding in 1979 and 1980 Source 1976 1977 1978 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. Total nondeposit funds 1 Seasonally adjusted2 ................................................................... 54.7 61.8 85.4 130.5' 129.9' 124.0' 118.8' 122.5' 129.2' 133.4' 124.2' 2 Not seasonally adjusted ............................................................. 53.3 60.4 84.4 130.7r 130.6' 126.8' 117.4' 121.2' 125.9' 130.4' 121.2' Federal funds, RPs, and other borrowings from nonbanks 3 Seasonally adjusted3 ................................................................... 47.1 58.4 74.8 91.3 91.9 85.9 88.0 92.0 97.2 97.9 94.8 4 Not seasonally adjusted ............................................................. 45.8 57.0 73.8 91.5 92.6 88.6 86.5 90.6 93.9 94.8 91.7 5 Net Eurodollar borrowings, not seasonally adjusted................ 3.7 -1.3 6.8 35.5' 34.4' 34.6' 28.1' 27.9' 29.4' 32.9' 26.9' 6 Loans sold to affiliates, not seasonally adjusted4-5.................. 3.8 4.8 3.8 3.7 3.6 3.6 2.8 2.7 2.6 2.6 2.6 Memo 7 Domestic chartered banks net positions with own foreign branches, not seasonally adjusted6...................................... -6.0 -12.5 -10.2 10.5 9.1 11.4 6.4 5.9 6.6 9.3 5.9 8 Gross due from balances ........................................................... 12.8 21.1 24.9 21.7 22.1 21.7 22.9 23.0 23.4 23.6 24.5 9 Gross due to balances................................................................. 6.8 8.6 14.7 32.2 31.2 33.0 29.3 28.9 29.8 32.9 30.4 10 Foreign-related institutions net positions with directly related institutions, not seasonally adjusted7.................................. 9.7 11.1 17.0 25.0' 25.3' 23.2' 21.7' 22.0' 22.8' 23.6' 20.9' 11 Gross due from balances ........................................................... 8.3 10.3 14.2 23.4' 25.7' 26.5' 28.9' 29.6' 30.4' 32.0' 28.5' 12 Gross due to balances................................................................. 18.1 21.4 31.2 48.4' 51.0' 49.7' 50.5' 51.6' 53.2' 55.6' 49.4' 13 Security RP borrowings, seasonally adjusted8.......................... 27.9 36.3 43.8 45.0 46.9 41.8 46.7 48.6 46.9 41.7 38.5 14 Not seasonally adjusted ............................................................. 27.0 35.1 42.4 46.8 46.4 43.9 45.2 45.3 45.2 41.1 38.1 15 U.S. Treasury demand balances, seasonally adjusted9............ 3.9 4.4 8.7 11.1 12.9 5.7 7.9 12.5 11.0 7.1 8.3 16 Not seasonally adjusted ............................................................. 4.4 5.1 10.3 12.4 11.7 5.5 9.5 12.4 11.4 7.4 8.7 17 Time deposits, $100,000 or more, seasonally adjusted10........ 137.7 162.0 213.0 223.2 228.4 231.3 229.8 231.1 237.0 239.5 244.5 18 Not seasonally adjusted ............................................................. 140.0 165.4 217.9 221.2 227.9 232.6 235.0 235.1 238.1 241.7 242.5 For notes see bottom of page A23. 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 Corporations1 Billions of dollars, estimated daily-average balances Commercial banks Type of holder 1978 19792 1980 1975 1976 1977 Dec. Dec. Dec. Sept. Dec. Mar. June Sept. Dec. Mar. 1 All holders—Individuals, partnerships, and corporations........................................................... 236.9 250.1 274.4 278.8 294.6 270.4 285.6 292.4 302.2 288.4 2 Financial business ....................................................... 20.1 22.3 25.0 25.9 27.8 24.4 25.4 26.7 27.1 28.4 3 Nonfinancial business ................................................. 125.1 130.2 142.9 142.5 152.7 135.9 145.1 148.8 157.7 144.9 4 Consumer ..................................................................... 78.0 82.6 91.0 95.0 97.4 93.9 98.6 99.2 99.2 97.6 5 Foreign........................................................................... 2.4 2.7 2.5 2.5 2.7 2.7 2.8 2.8 3.1 3.1 6 Other ............................................................................. 11.3 12.4 12.9 13.1 14.1 13.5 13.7 14.9 15.1 14.4 Weekly reporting banks 1978 19793 1980 1975 1976 1977 Dec. Dec. Dec. Nov. Dec. Mar. June Sept. Dec. Mar. 7 All holders—Individuals, partnerships, and corporations........................................................... 124.4 128.5 139.1 142.7 147.0 121.9 128.8 132.7 139.3 133.6 8 Financial business ....................................................... 15.6 17.5 18.5 19.3 19.8 16.9 18.4 19.7 20.1 20.1 9 Nonfinancial business ................................................. 69.9 69.7 76.3 75.7 79.0 64.6 68.1 69.1 74.1 69.1 10 Consumer ..................................................................... 29.9 31.7 34.6 37.7 38.2 31.1 33.0 33.7 34.3 34.2 11 Foreign........................................................................... 2.3 2.6 2.4 2.5 2.5 2.6 2.7 2.8 3.0 3.0 12 Other ............................................................................. 6.6 7.1 7.4 7.5 7.5 6.7 6.6 7.4 7.8 7.2 1. Figures include cash items in process of collection. Estimates of gross deposits 3. After the end of 1978 the large weekly reporting bank panel was changed to are based on reports supplied by a sample of commercial banks. Types of depositors 170 large commercial banks, each of which had total assets in domestic offices in each category are described in the June 1971 Bulletin, p. 466. exceeding $750 million as of Dec. 31, 1977. See “Announcements,” p. 408 in the 2. Beginning with the March 1979 survey, the demand deposit ownership survey May 1978 Bulletin. Beginning in March 1979, demand deposit ownership esti­ sample was reduced to 232 banks from 349 banks, and the estimation procedure mates for these large banks are constructed quarterly on the basis of 97 sample was modified slightly. To aid in comparing estimates based on the old and new banks and are not comparable with earlier data. The following estimates in billions reporting sample, the following estimates in billions of dollars for December 1978 of dollars for December 1978 have been constructed for the new large-bank panel; have been constructed using the new smaller sample; financial business, 27.0; financial business, 18.2; nonfinancial business, 67.2; consumer, 32.8; foreign, 2.5; nonfinancial business, 146.9; consumer, 98.3; foreign, 2.8; and other, 15.1 other, 6.8. 1.33 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING Millions of dollars, end of period 1979 1980 Instrument 1976 1977 1978 Dec. Dec. Dec. Oct.1 Nov. Dec. Jan. Feb. Mar. Apr. Commercial paper (seasonally adjusted) 1 All issuers ..................................................................... 53,010 65.036 83,420 107,116 109,395 112,803 116,718 116,446 119,893 120,865 Financial companies2 Dealer-placed paper3 2 Total ........................................................................... 7,263 8,888 12,300 16,133 16,765 17,579 17,768 17,308 18,254 18,881 3 Bank-related ............................................................. 1,900 2,132 3,521 3,052 2,958 2,784 3,034 3,010 3,142 3,467 Directly placed paper4 4 Total ........................................................................... 32,622 40,612 51,755 63,338 64,640 64,931 66,342 65,368 64,440 66,088 5 Bank-related ............................................................. 5,959 7,102 12,314 18,024 18,339 17,598 19,221 19,922 19,338 19,143 6 Nonfinancial companies5............................................. 13,125 15,536 19,365 27,645 27,990 30,293 32,608 33,770 37,199 35,896 Bankers dollar acceptances (not seasonally adjusted) 7 Total .......................................................................... 22,523 25,450 33,700 43,486 43,599 45,321 47,780 50,269 49,317 50,177 Holder 8 Accepting banks........................................................... 10,442 10,434 8,579 7,785 8,297 9,865 8,578 9,343 8,159 8,159 9 Own bills................................................................... 8,769 8,915 7,653 7,121 7,514 8,327 7,692 8,565 7,560 7,488 10 Bills bought............................................................... 1,673 1,519 927 664 782 1,538 886 778 598 670 Federal Reserve Banks 11 Own account............................................................. 991 954 1 317 269 704 0 205 171 0 12 Foreign correspondents........................................... 375 362 664 1,498 1,465 1,382 1,431 1,417 1,373 1,555 13 Others ........................................................................... 10,715 13,700 24,456 33,886 33,569 33,370' 37,771 39,Bos'­ 39,614 40,463 Basis 14. Imports into United States......................................... 4,992 6,378 8,574 10,129 10,354 10,270 11,217 ll,393 10,926 10,946 15 Exports from United States...................................... 4,818 5,863 7,586 9,519 9,271 9,640 10,248 11,102 11,001 11,221 16 All other ....................................................................... 12,713 13,209 17,540 23,838 23,974 25,411 26,315 27,774 27,389 28,010 1. A change in reporting instructions results in offsetting shifts in the dealer- 3. Includes all financial company paper sold by dealers in the open market. placed and directly placed financial company paper in October. 4. As reported by financial companies that place their paper directly with inves­ 2. Institutions engaged primarily in activities such as, but not limited to, com­ tors. mercial, savings, and mortgage banking; sales, personal, and mortgage financing; 5. Includes public utilities and firms engaged primarily in such activities, as factoring, finance leasing, and other business lending; insurance underwriting; and communications, construction, manufacturing, mining, wholesale and retail trade, other investment activities. transportation, and reserves. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A26 Domestic Financial Statistics □ June 1980 1.34 PRIME RATE CHARGED BY BANKS on Short-Term Business Loans Percent per annum Effective date Rate Effective Date Rate Month Average Month Average rate rate 1979—Dec. 7 ................ 15V4 1980—Apr. 2 ................ 20 1979—Jan............................ 11.75 1979—Sept ........................ 12.90 1980—Feb. 19 .................. 15^4 18 ................ 19^2 Feb........................... 11.75 Oct............................ 14.39 22.................. 16^4-16^ May 1 .................. 18W19 Mar........................... 11.75 Nov 15.55 29.................. 163/4 2 .................. \%Vi Apr........................... 11.75 Dec 15.30 Mar. 4 ................ rm 7 .................. YlVi May ........................ 11.75 1980—Jan............................ 15.25 7 ................ 17^4 16 .................. 16 Vi June........................ 11.65 Feb............................ 15.63 14 ................ 181h 23 .................. 14 Vi July ........................ 11.54 Mar. 18.31 19 ................ 19 30 .................. 14 Aug........................... 11.91 Apr 19.77 28 ................ 19 Vi May ........................ 16.57 1.35 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, February 4-9, 1980 A Size of loan (in thousands of dollars) All sizes 1,000 1-24 25-49 50-99 100-499 50-999 and over Short-Term Commercial and Industrial Loans 1 Amount of loans (thousands of dollars)...................... 9,920,415 768,933 485,280 526,248 1,709,993 659,611 5,770,349 2 Number of loans ............................................................. 135,532 100,191 14,735 8,270 9,789 1,032 1,515 3 Weighted-average maturity (months).......................... 2.5 3.4 3.4 3.2 3.3 3.1 1.9 4 Weighted-average interest rate (percent per annum) 15.67 15.06 15.54 15.91 16.23 16.34 15.50 5 Interquartile range1 ..................................................... 14.87-16.43 13.65-16.99 13.80-17.27 14.99-17.39 15.40-17.27 15.73-17.00 14.84-16.21 Percentage of amount of loans 6 With floating rate............................................................. 50.8 19.0 39.4 46.3 58.1 61.0 53.3 7 Made under commitment............................................... 47.8 19.8 29.0 37.2 50.0 59.6 52.0 8 With no stated maturity................................................. 25.6 10.7 18.1 22.9 21.1 34.4 28.7 Long-Term Commercial and Industrial Loans 9 Amount of loans (thousands of dollars)...................... 1,866,260 287,223 254,459 120,692 1,223,885 10 Number of loans ............................................................. 21,710 20,016 1,243 186 264 11 Weighted-average maturity (months).......................... 43.2 32.3 42.8 50.9 45.1 12 Weighted-average interest rate (percent per annum) 15.32 15.42 15.40 15.70 15.24 13 Interquartile range1 ..................................................... 15.25-16.25 14.00-16.94 15.25-16.70 15.25-16.90 15.25-15.86 Percentage of amount of loans 14 With floating rate............................................................. 65.6 20.0 46.0 76.5 79.3 15 Made under commitment............................................... 71.4 29.0 72.9 74.9 80.7 Construction and Land Development Loans 16 Amount of loans (thousands of dollars)...................... 855,640 102,387 97,606 178,002 278,768 198,877 17 Number of loans ............................................................. 18,763 11,371 2,806 2,645 1,788 152 18 Weighted-average maturity (months) .......................... 13.1 17.5 4.5 2.8 20.7 14.5 19 Weighted-average interest rate (percent per annum) 15.79 15.80 14.47 14.96 16.80 15.78 20 Interquartile range1 ..................................................... 13.85-17.99 14.08-17.45 12.55-16.09 13.80-16.10 16.25-18.11 13.50-18.01 Percentage of amount of loans 21 With floating rate............................................................. 39.3 26.5 18.4 16.5 35.4 82.2 22 Secured by real estate..................................................... 95.4 93.1 99.4 99.0 94.7 92.5 23 Made under commitment............................................... 60.6 62.8 78.4 69.2 42.4 68.7 24 With no stated maturity................................................. 9.0 7.2 4.2 4.8 10.8 13.4 Type of construction 25 1- to 4-family ................................................................... 54.2 75.6 88.7 74.1 34.7 36.0 26 Multifamily ....................................................................... 5.3 3.0 2.7 4.0 9.1 3.8 27 Nonresidential ................................................................. 40.4 21.4 8.6 22.0 56.1 60.3 All 250 sizes 1-9 10-24 25-49 50-99 100-249 and over Loans to Farmers 28 Amount of loans (thousands of dollars)...................... 1,142,204 149,134 177,200 184,658 221,694 195,259 214,259 29 Number of loans ............................................................. 63,877 41,030 11,985 5,443 3,490 1,485 443 30 Weighted-average maturity (months).......................... 7.2 8.1 7.6 6.6 7.1 8.3 5.7 31 Weighted-average interest rate (percent per annum) 14.14 13.49 13.58 13.72 13.76 14.77 15.25 32 Interquartile range1 ..................................................... 13.39-15.03 12.89-14.37 12.55-14.67 13.21-14.28 13.42-14.20 13.65-15.75 13.90-16.36 By purpose of loan 33 Feeder livestock ............................................................... 14.41 13.35 12.99 14.08 14.14 14.64 15.40 34 Other livestock................................................................. 13.48 14.19 14.81 13.76 12.44 * * 35 Other current operating expenses................................ 14.28 13.52 13.81 14.09 14.32 14.73 14.79 36 Farm machinery and equipment................................... 13.00 13.17 13.10 12.05 13.75 14.02 * 37 Other ................................................................................. 14.60 13.35 13.52 14.06 14.16 16.39 15.86 1. Interest rate range that covers the middle 50 percent of the total dollar amount A Revised; data published in the April 1980 Bulletin were not final, of loans made. 2. Fewer than 10 sample loans. Note. For more detail, see the Board’s E.2(416) statistical release. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Markets A ll 1.36 INTEREST RATES Money and Capital Markets Averages, percent per annum 1980 1980, week ending Instrument 1977 1978 1979 Feb. Mar. Apr. May May 3 May 10 May 17 May 24 May 31 Money market rates 1 Federal funds1 ............................................. 5.54 7.94 11.20 14.13 17.19 17.61 10.98 15.12 12.96 10.85 9.46 Commercial paper2 3 2 1-month ..................................................... 5.42 7.76 10.86 13.62 16.55 16.10 9.60 12.76 10.31 9.44 9.13 8.19 3 3-month ..................................................... 5.54 7.94 10.97 13.78 16.81 15.78 9.49 12.44 10.04 9.38 9.12 8.19 4 6-month ..................................................... 5.60 7.99 10.91 13.60 16.50 14.93 9.29 11.88 9.60 9.26 8.95 8.15 Finance paper, directly placed2 3 5 1-month ..................................................... 5.38 7.73 10.78 13.58 16.30 15.70 9.30 12.20 9.93 9.31 8.79 8.00 6 3-month ..................................................... 5.49 7.80 10.47 13.05 15.36 14.05 9.09 11.42 9.90 8.95 8.62 7.81 7 6-month ..................................................... 5.50 7.78 10.25 12.39 14.70 13.68 9.01 11.15 9.73 8.93 8.64 7.81 8 Prime bankers acceptances, 90-day3 4 ... 5.59 8.11 11.04 14.01 17.10 15.63 9.60 12.46 10.04 9.60 9.08 8.42 Certificates of deposit, secondary market5 9 1-month ..................................................... 5.48 7.88 11.03 13.93 16.81 16.23 9.77 12.97 10.30 9.65 9.42 8.35 10 3-month ..................................................... 5.64 8.22 11.22 14.30 17.57 16.14 9.79 12.89 10.26 9.70 9.43 8.43 11 6-month ..................................................... 5.92 8.61 11.44 14.58 17.74 15.80 9.78 12.67 10.07 9.71 9.43 8.60 12 Eurodollar deposits, 3-month6 ................ 6.05 8.74 11.96 15.33 18.72 17.81 11.20 15.33 12.96 11.16 11.09 9.78 U.S. Treasury bills3 7 Secondary market 13 3-month ................................................. 5.27 7.19 10.07 12.86 15.20 13.20 8.58 10.47 9.14 8.53 8.15 7.70 14 6-month ................................................. 5.53 7.58 10.06 12.86 15.03 12.88 8.65 10.38 9.09 8.68 8.26 7.87 15 1-year ..................................................... 5.71 7.74 9.75 12.46 14.03 11.97 8.66 9.99 9.00 8.72 8.34 8.03 Auction average8 16 3-month ................................................. 5.265 7.221 10.041 12.814 15.526 14.003 9.150 10.788 9.728 8.604 8.953 7.675 17 6-month ................................................. 5.510 7.572 10.017 12.721 15.100 13.618 9.149 10.790 9.495 8.782 8.923 7.753 Capital market rates U.S. Treasury Notes and Bonds Constant maturities9 18 1-year ....................................................... 6.09 8.34 10.67 13.92 15.82 13.30 9.39 10.94 9.77 9.44 9.02 8.68 19 2-year....................................................... 6.45 8.34 10.12 13.42 14.88 12.50 9.45 10.61 9.60 9.48 9.21 9.07 20 2^-year10 ............................................... 14.00 14.65 11.25 9.05 21 3-year ....................................................... 6.69 8.29 ' 9.71 ' 12.84 14.05 12.02 9.44 10.49 ' 9.57 9.44 9.23 ' 9.14 22 5-year....................................................... 6.99 8.32 9.52 12.60 13.47 11.84 9.95 10.63 9.94 9.94 9.89 9.79 23 7-year....................................................... 7.23 8.36 9.48 12.53 13.00 11.49 10.09 10.54 10.02 10.16 10.08 9.98 24 10-year ..................................................... 7.42 8.41 9.44 12.41 12.75 11.47 10.18 10.57 10.08 10.25 10.16 10.14 25 20-year..................................................... 7.67 8.48 9.33 12.21 12.49 11.42 10.44 10.78 10.32 10.49 10.50 10.37 26 30-year..................................................... 8.49 9.29 12.13 12.34 11.40 10.36 10.77 10.30 10.40 10.38 10.25 Composite11 27 3 to 5 years12 ........................................ 6.85 8.30 9.58 12.52 13.41 28 Over 10 years (long-term) .................. 7.06 7.89 8.74 11.55 11.87 State and Local Notes and Bonds Moody’s series13 29 Aaa ............................................................ 5.20 5.52 5.92 7.28 8.16 7.95 6.80 7.15 6.60 6.60 6.80 6.85 30 Baa............................................................... 6.12 6.27 6.73 8.12 10.30 9.19 8.02 8.25 8.00 7.85 8.00 8.00 31 Bond Buyer series14 ................................ 5.68 6.03 6.52 8.16 9.17 8.63 7.59 7.96 7.11 7.44 7.72 7.73 Corporate Bonds 32 Seasoned issues, all industries15............ 8.43 9.07 10.12 12.92 13.73 13.21 12.11 12.60 12.11 12.04 12.10 12.00 By rating group 33 Aaa ......................................................... 8.02 8.73 9.63 12.38 12.96 12.04 10.99 11.38 10.93 10.96 11.02 10.90 34 Aa ........................................................... 8.24 8.92 9.94 12.73 13.51 13.06 11.91 12.39 11.91 11.80 11.92 11.82 35 A ............................................................. 8.49 9.12 10.20 12.99 13.97 13.55 12.35 12.94 12.41 12.28 12.33 12.16 36 Baa........................................................... 8.97 9.45 10.69 13.57 14.45 14.19 13.17 13.68 13.20 13.10 13.11 13.10 Aaa utility bonds16 37 New issue ............................................... 8.19 8.96 10.03 13.57 14.00 12.90 11.53 12.10 11.38 11.43 11.50 11.52 38 Recently offered issues........................ 8.19 8.97 10.02 13.35 13.90 12.91 11.64 12.05 11.55 11.65 11.60 11.55 Memo: Dividend/price ratio17 39 Preferred stocks.................................... 7.60 8.25 9.07 10.55 11.26 11.06 10.20 10.60' 10.13 10.22 10.29 10.16 40 Common stocks .................................... 4.56 5.28 5.46 5.24 5.77 6.05 5.77 5.94 5.82 5.83 5.82 5.58 1. Weekly figures are seven-day averages of daily effective rates for the week 10. Each figure is an average of only five business days near the end of the ending Wednesday; the daily effective rate is an average of the rates on a given month. The rate for each month is used to determine the maximum interest rate day weighted by the volume of transactions at these rates. payable in the following month on small saver certificates. (See table 1.16). 2. Beginning November 1977, unweighted average of offering rates quoted by 11. Unweighted averages for all outstanding notes and bonds in maturity ranges at least five dealers (in the case of commercial paper), or finance companies (in shown, based on daily closing bid prices. “Long-term” includes all bonds neither the case of finance paper). Previously, most representative rate quoted by those due nor callable in less than 10 years, including several very low yielding “flower” dealers and finance companies. Before November 1979, maturities for data shown bonds. are 30-59 days, 90-119 days, and 120-179 days for commercial paper; and 30-59 12. The three- to five-year series has been discontinued. days, 90-119 days, and 150-179 days for finance paper. 13. General obligations only, based on figures for Thursday, from Moody’s 3. Yields are quoted on a bank-discount basis. Investors Service. 4. Average of the midpoint of the range of daily dealer closing rates offered for 14. Twenty issues of mixed quality. domestic issues. 15. Averages of daily figures from Moody’s Investors Service. 5. Five-day average of rates quoted by five dealers (three-month series was 16. Compilation of the Board of Governors of the Federal Reserve System. previously a seven-day average). Issues included are long-term (20 years or more). New-issue yields are based on 6. Averages of daily quotations for the week ending Wednesday. quotations on date of offering; those on recently offered issues (included only for 7. Except for auction averages, yields are computed from daily closing bid prices. first 4 weeks after termination of underwriter price restrictions), on Friday close- 8. Rates are recorded in the week in which bills are issued. of-business quotations. 9. Yield on the more actively traded issues adjusted to constant maturities by 17. Standard and Poor’s corporate series. Preferred stock ratio based on a sample the U.S. Treasury, based on daily closing bid prices. of ten issues: four public utilities, four industrials, one financial, and one trans­ portation. Common stock ratios on the 500 stocks in the price index. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic Financial Statistics □ June 1980 1.37 STOCK MARKET Selected Statistics 1979 1980 Indicator 1977 1978 1979 Nov. Dec. Jan. Feb. Mar. Apr. May Prices and trading (averages of daily figures) Common stock prices 1 New York Stock Exchange (Dec. 31, 1965 = 50) . 53.67 53.76 55.67 59.02 61.75 63.74 66.05 59.52 58.47 61.38 2 Industrial ................................................................... 57.84 58.30 61.82 66.45 69.82 72.67 76.42 68.71 66.31 69.39 3 Transportation ......................................................... 41.07 43.25 45.20 47.61 50.59 52.61 57.92 51.77 48.62 51.07 4 Utility......................................................................... 40.91 39.23 36.46 36.55 37.29 37.08 36.22 33.38 35.29 37.31 5 Finance .................................................................... 55.23 56.74 58.65 60.64 63.21 64.22 61.84 54.71 57.32 61.47 6 Standard & Poor’s Corporation (1941—43 = 10)1 . 98.18 96.11 98.34 103.66 107.78 110.87 115.34 104.69 102.97 107.69 7 American Stock Exchange (Aug. 31, 1973 = 100) 116.18 144.56 186.56 216.58 238.83 259.54 288.99 259.79 242.60 258.45 Volume of trading (thousands of shares) 8 New York Stock Exchange ...................................... 20,936 28,591 32,233 31,126 35,510 52,647 47,827 41,736 32,102 36,425 9 American Stock Exchange ......................................... 2,514 3,622 4,182 3,938 5,389 9,363 6,903 5,947 3,428 3,799 Customer 1financing (end-of-period balances,in millionsof dollars) 10 Regulated margin credit at brokers/dealers2 9,993 11,035 11,615 11,083 11,619' 11,987' 12,638 11 Margin stock3 .................................................. 9,740 10,830 11,450 10,920 11,450 11,820 12,460 11,740 11,140 12 Convertible bonds .......................................... 250 205 164 161 167' 165' 175 171 167 13 Subscription issues.......................................... 3 1 2 2' 2' 3 3 2 Free credit balances at brokers4 14 Margin-account................................................ 640 835 1,050 955 1,105 1,180 1,320 1,365 1,290 15 Cash-account.................................................... 2,060 2,510 4,060 3,435 4,060 4,680 4,755 5,000 4,790 Margin-account debt at brokers (percentage distribution, end of period) 16 Total .................................... 100.0 100.0 100.0 By equity class (in percent)5 17 Under 40 ............................ 18.0 33.0 16.0 17.0 16.0 13.0 16.0 45.0 28.0 18 40-49 .................................. 36.0 28.0 26.0 31.0 31.0 29.0 29.0 22.0 31.0 19 50-59 .................................. 23.0 18.0 24.0 25.0 24.0 25.0 25.0 13.0 18.0 20 60-69 .................................. 11.0 10.0 14.0 13.0 14.0 16.0 14.0 9.0 10.0 21 70-79 .................................. 6.0 6.0 8.0 7.0 8.0 9.0 9.0 6.0 7.0 22 80 or more.......................... 5.0 5.0 7.0 7.0 7.0 8.0 7.0 5.0 6.0 Special miscellaneous-account balances at brokers (end of period) 23 Total balances (millions of dollars)6 ........................ 9,910 13,092 15,340' 14,145' 15,340' 15,490' 15,675' 15,855' 15,520 f Distribution by equity status (percent) 1 24 Net credit status........................................................... 43.4 41.3 48.5 46.5 48.5 45.0 46.9 48.7 44.3 n.a. Debt status, equity of 1 25 60 percent or more ................................................. 44.9 45.1 43.6 45.0 43.6 47.7 45.4 39.7 44.0 26 Less than 60 percent.............................................. 11.7 13.6 7.9 8.5 7.9 7.3 7.7 11.6 11.7 \ Margin requirements (percent of market value and effective date)7 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 insurance 5. Each customer’s equity in his collateral (market value of collateral less net companies. With this change the index includes 400 industrial stocks (formerly debit balance) is expressed as a percentage of current collateral values. 425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and 40 6. Balances that may be used by customers as the margin deposit required for financial. additional purchases. Balances may arise as transfers based on loan values of other 2. Margin credit includes all credit extended to purchase or carry stocks or collateral in the customer’s margin account or deposits of cash (usually sales pro­ related equity instruments and secured at least in part by stock. Credit extended ceeds) occur. is end-of-month data for member firms of the New York Stock Exchange. 7. Regulations G, T, and U of the Federal Reserve Board of Governors, pre­ In addition to assigning a current loan value to margin stock generally, Regu­ scribed in accordance with the Securities Exchange Act of 1934, limit the amount lations T and U permit special loan values for convertible bonds and stock acquired of credit to purchase and carry margin stocks that may be extended on securities through exercise of subscription rights. as collateral by prescribing a maximum loan value, which is a specified percentage 3. A distribution of this total by equity class is shown on lines 17-22. of the market value of the collateral at the time the credit is extended. Margin 4. Free credit balances are in accounts with no unfulfilled commitments to the requirements are the difference between the market value (100 percent) and the brokers and are subject to withdrawal by customers on demand. maximum loan value. The term “margin stocks” is defined in the corresponding regulation. 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 1979 1980 Account 1977 1978 July Aug. Sept. Oct. Nov. Dec/ Jan/ Feb/ Mar. Apr .p Savings and loan associations 1 Assets ............................................................. 459,241 523,542 561,037 566,493 570,479 576,251 578,922 579,307 582,252 585,685 589,498 591,024 2 Mortgages ................................................. 381,163 432,808 460,620 464,609 468,307 472,198 474,678 475,797 476,448 477,303 479,078 480,113 3 Cash and investment securities1............... 39,150 44,884 49,496 50,007 49,3013 49,220 48,180 46,541 48,473 50,168 50,899 50,588 4 Other ......................................................... 38,928 45,850 50,721 51,877 52,871 54,833 56,064 56,969 57,331 58,214 59,521 60,323 5 Liabilities and net worth............................ 459,241 523,542 561,037 570,479 566,493 576,251 578,922 579,307 582,252 585,685 589,498 591,024 6 Savings capital .......................................... 386,800 430,953 456,657 457,856 462,626 464,489 465,646 470,171 472,236 473,862 478,265 472,423 7 Borrowed money ...................................... 27,840 42,907 48,437 50,437 52,738 54,268 54,433 55,375 55,233 55,276 57,346 57,454 8 FHLBB ................................................. 19,945 31,990 35,286 36,009 37,620 39,223 39,638 40,441 40,364 40,337 42,413 42,742 9 Other ..................................................... 7,895 10,917 13,151 14,428 15,118 15,045 14,795 14,934 14,869 14,939 14,933 14,712 10 Loans in process........................................ 9,911 10,721 11,309 11,047 10,909 10,766 10,159 9,511 8,735 8,269 8,079 7,676 11 Other ......................................................... 9,506 9,904 11,681 15,712 12,497 14,673 16,324 11,684 13,315 15,385 12,683 14,272 12 Net worth2................................................. 25,184 29,057 31,131 31,441 31,709 32,055 32,360 32,566 32,733 32,893 33,125 33,199 13 Memo: Mortgage loan com­ mitments outstanding3....................... 19,875 18,911 22,360 22,282 22,397 20,930 18,029 16,007 15,559 16,744 15,844 13,960 Mutual savings banks4 14 Assets ............................................................. 14,287 158,174 162,598 163,388 163,431 163,133 163,205 163,405 163,252 164,270 165,107 Loans 15 Mortgage ................................................ 88,195 95,157 97,238 97,637 97,973 98,304 98,610 98,908 98,940 99,220 99,151 16 Other ..................................................... 6,210 7,195 10,282 10,430 9,982 9,510 9,449 9,253 9,804 10,044 10,131 Securities 17 U.S. government5.................................. 5,895 4,959 7,992 7,921 7,891 7,750 7,754 7,658 7,387 7,436 7,629 18 State and local government................. 2,828 3,333 3,154 3,149 3,150 3,100 3,003 2,930 2,887 2,853 2,824 19 Corporate and other6............................. 37,918 39,732 37,171 37,125 37,076 37,210 37,036 37,086 37,114 37,223 37,493 20 Cash ........................................................... 2,401 3,665 2„540 2,866 3,020 2,909 3,010 3,156 2,703 3,012 3,361 21 Other assets................................................ 3,839 4,131 4,220 4,260 4,339 4,351 4,343 4,412 4,417 4,481 4,518 22 Liabilities ....................................................... 147,287 158,174 162,598 163,388 163,431 163,133 163,205 163,405 163,252 164,270 165,107 n.a. 23 Deposits ..................................................... 134,017 142,701 145,757 145,713 146,252 145,096 144,828 146,006 145,044 145,171 146,328 24 Regular7................................................. 132,744 141,170 143,843 143,731 144,258 143,263 143,064 144,070 143,143 143,284 144,214 25 Ordinary savings................................ 78,005 71,816 67,537 66,733 65,676 62,672 61,156 61,123 59,252 58,234 56,948 26 Time and other.................................. 54,739 69,354 76,306 76,998 78,572 80,591 81,908 82,947 83,891 85,050 87,266 27 Other ..................................................... 1,272 1,531 1,914 1,982 2,003 1,834 1,764 1,936 1,901 1,887 2,115 28 Other liabilities.......................................... 3,292 4,565 5,578 6,350 5,790 6,600 6,872 2,220 2,557 3,127 2,607 29 General reserve accounts ......................... 9,978 10,907 11,264 11,324 11,388 11,437 11,504 163,405 11,544 11,615 11,643 30 Memo: Mortgage loan com­ mitments outstanding8....................... 4,066 4,400 4,214 4,071 4,123 3,749 3,619 3,182 2,919 2,618 2,397 Life insurance companies 31 Assets ............................................................. 351,722 389,924 414,120 418,350 421,660 423,760 427,496 431,453 436,378 439,119 Securities 32 Government .......................................... 19,553 20,009 20,468 20,472 20,379 20,429 20,486 20,294 20,281 20,317 33 United States9.................................... 5,315 4,822 5,228 5,229 5,067 5,075 5,122 4,984 4,896 4,953 34 State and local .................................. 6,051 6,402 6,243 6,258 6,295 6,339 6,354 6,392 6,417 6,516 35 Foreign10 ............................................ 8,187 8,785 8,997 8,985 9,017 9,015 9,010 8,918 8,968 8,850 n.a. n.a. 36 Business ................................................. 175,654 198,105 212,876 215,252 216,500 216,183 217,856 218,284 222,475 223,998 37 Bonds ................................................. 141,891 162,587 175,854 176,920 177,698 178,633 179,158 178,828 182,305 183,383 38 Stocks ................................................. 33,763 35,518 37,022 38,332 38,802 37,550 38,698 39,456 40,170 40,615 39 Mortgages ................................................. 96,848 106,167 112,120 113,102 114,368 115,991 117,253 118,784 120,083 121,100 40 Real estate................................................. 11,060 11,764 12,351 12,738 12,740 12,816 12,906 13,047 13,076 13,241 41 Policy loans................................................ 27,556 30,146 32,390 32,713 33,046 33,574 34,220 34,761 35,261 35,784 42 Other assets................................................ 21,051 23,733 23,915 24,073 24,627 24,767 24,775 26,283 25,202 24,677 Credit unions 43 Total assets/liabilities and capital..................................................... 53,755 62,348 68,840 65,547 66,280 65,063 65,419 65,854 64,506 64,857 65,678 65,190 44 Federal ....................................................... 29,564 34,760 35,413 35,724 36,151 35,537 35,670 35,934 35,228 35,425 36,091 35,834 45 State ........................................................... 24,191 27,588 29,427 29,823 30,129 29,526 29,749 29,920 29,278 29,432 29,587 29,356 46 Loans outstanding .................................... 41,845 50,269 52,083 52,970 53,545 53,533 56,267 53,125 52,089 51,626 51,337 50,344 47 Federal ................................................... 22,634 27,687 28,379 28,848 29,129 29,020 30,613 28,698 28,053 27,783 27,685 27,119 48 State ....................................................... 19,211 22,582 23,704 24,122 24,416 24,513 25,654 24,426 24,036 23,843 23,652 23,225 49 Savings ....................................................... 46,516 53,517 56,393 56,583 57,255 55,739 55,797 56,232 55,447 55,790 56,743 56,338 50 Federal (shares) .................................... 25,576 29,802 30,732 30,761 31,097 30,366 30,399 35,530 30,040 32,256 30,948 30,851 51 State (shares and deposits)................... 20,940 23,715 25,661 25,822 26,158 25,373 25,398 25,702 25,407 25,534 25,795 25,487 For notes see bottom of page A30. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 Domestic Financial Statistics □ June 1980 1.39 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Calendar year Fiscal Fiscal Fiscal Type of account or operation year year year 1978 1979 1980 1977 1978 1979 H2 HI H2 Feb. Mar. Apr. U.S. budget 1 Receipts* ................................................... 357,762 401,997 465,940 206,275 246,574 233,952 37,862 33,351 61,097 2 Outlays1 ..................................................... 402,725 450,836 493,673 238,186 245,616 263,044 47,208 46,566 51,237 3 Surplus, or deficit(-) .............................. -44,963 -48,839 -27,733 -31,912 958 -29,093 -9,346 -13,215 9,860 4 Trust funds ............................................ 9,497 12,693 18,335 11,754 4,041 9,679 3,398 -1,590 -153 5 Federal funds2........................................ -54,460 -61,532 -46,069 -43,666 -4,999 -38,773 -12,745 -11,625 10,013 Off-budget entities (surplus, or deficit 6 federal Financing Bank outlays ............. -8,415 -10,661 -13,261 -,5,082 -7,712 -5,909 -819 -2,016 1,848 7 Other3 ....................................................... -269 334 832 1,843 -447 805 -294 -118 24 U.S. budget plus off-budget, including Federal Financing Bank 8 Surplus, or deficit (-) ............................. -53,647 -59,166 -40,162 -35,151 -7,201 -34,197 -10,459 -15,349 8,036 Source or financing 9 Borrowing from the public................... 53,516 59,106 33,641 30,314 6,039 31,320 2,066 11,802 4,631 10 Cash and monetary assets (decrease, or increase (-)r................................ -2,247 -3,023 -408 3,381 -8,878 3,059 6,007 3,231 -13,542 11 Other5 ................................................... 2,378 3,083 6,929 1,456 10,040 -182 2,386 315 875 Memo; 12 Treasury operating balance (level, end of period) ............................................... 19,104 22,444 24,176 16,291 17,485 15,924 10,688 8,154 18,430 13 Federal Reserve Banks......................... 15,740 16,647 6,489 4,196 3,290 4,075 2,417 2,334 4,561 14 Tax and loan accounts........................... 3,364 5,797 17,687 12,095 14,195 11,849 8,271 5,820 13,869 1. Effective June 1978, earned income credit payments in excess of an indi­ 5. Includes accrued interest payable to the public; deposit funds; miscellaneous vidual’s tax liability, formerly treated as income tax refunds, are classified as liability (including checks outstanding) and asset accounts; seignorage; increment outlays retroactive to January 1976. on gold; net gain/loss for U.S. currency valuation adjustment; net gain/loss for 2. Half-year figures are calculated as a residual (total surplus/deficit less trust IMF valuation adjustment; and profit on the sale of gold. fund surolus/deficit). 3. Includes Pension Benefit Guaranty Corporation; Postal Service Fund; Rural Source. “Monthly Treasury Statement of Receipts and Outlays of the U.S. Electrification and Telephone Revolving Fund; and Rural Telephone Bank. Government,” Treasury Bulletin, and the Budget of the United States Government, 4. Includes U.S. Treasury operating cash accounts; special drawing rights; gold Fiscal Year 1981. tranche drawing rights; loans to International Monetary Fund; and other cash and monetary assets. NOTES TO TABLE 1.38 1. Holdings of stock of the Federal Home Loan Banks are included in “other 10. Issues of foreign governments and their subdivisions and bonds of the In­ assets.” ternational Bank for Reconstruction and Development. 2. Includes net undistributed income, which is accrued by most, but not all, associations. Note. Savings and loan associations: Estimates by the FHLBB for all associa­ 3. Excludes figures for loans in process, which are shown as a liability. tions in the United States. Data are based on monthly reports of federally insured 4. The NAMSB reports that, effective April 1979, balance sheet data are not associations and annual reports of other associations. Even when revised, data for strictly comparable with previous months. Beginning April 1979, data are reported current and preceding year are subject to further revision. on a net-of-valuation-reserves basis. Prior to that date, data were reported on a Mutual savings banks: Estimates of National Association of Mutual Savings gross-of-valuation-reserves basis. Banks for all savings banks in the United States. 5. Beginning April 1979, includes obligations of U.S. government agencies. Prior Life insurance companies: Estimates of the American Council of Life Insurance to that date, this item was included in Corporate and other.” for all life insurance companies in the United States. Annual figures are annual- 6. Includes securities of foreign governments and international organizations statement asset values, with bonds carried on an amortized basis and stocks at and, prior to April 1979, nonguaranteed issues of U.S. government agencies. year-end market value. Adjustments for interest due and accrued and for differ­ 7. Excludes checking, club, and school accounts. ences between market and book values are not made on each item separately but 8. Commitments outstanding (including loans in process) of banks in New York are included, in total, in “other assets.” State as reported to the Savings Banks Association of the state of New York. Credit unions: Estimates by the National Credit Union Administration for a 9. Direct and guaranteed obligations. Excludes federal agency issues not guar­ group of federal and state-chartered credit unions that account for about 30 percent anteed, which are shown in the table under “Business” securities. of credit union assets. Figures are preliminary and 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 Fiscal Fiscal • Fiscal Source or type year year year 1978 1979 1980 1977 1978 1979 H2 HI H2 Feb. Mar. Apr. Receipts 1 All sources1 ............................................. 357,762 401,997 465,940 206,275 246,574 233,952 37,862 33,351 61,097 2 Individual income taxes, net................. 157,626 180,988 217,841 98,854 111,603 115,488 15,522 9,056 31,488 3 Withheld .............................................. 144,820 165,215 195,295 90,148 98,683 105,764 19,466 18,077 17,136 4 Presidential Election Campaign Fund 37 39 36 3 32 3 7 9 7 5 Nonwithheld ........................................ 42,062 47,804 56,215 10,777 44,116 12,355 1,230 2,998 24,937 6 Refunds1 ............................................. 29,293 32,070 33,705 2,075 31,228 2,634 5,181 12,027 10,592 Corporation income taxes 7 Gross receipts...................................... 60,057 65,380 71,448 28,536 42,427 29,169 2,117 10,255 10,244 8 Refunds ............................................... 5,164 5,428 5,771 2,757 2,889 3,306 697 747 1,073 9 Social insurance taxes and contributions, net..................................................... 108,683 123,410 141,591 61,064 75,609 71,031 16,857 11,499 15,886 10 Payroll employment taxes and contributions2 .............................. 88,196 99,626 115,041 51,052 59,298 60,562 14,447 10,346 10,122 11 Self-employment taxes and contributions3 .............................. 4,014 4,267 5,034 369 4,616 417 377 401 3,545 12 Unemployment insurance ................... 11,312 13,850 15,387 6,727 8,623 6,899 1,490 208 1,646 13 Other net receipts4.............................. 5,162 5,668 6,130 2,917 3,072 3,149 543 544 573 14 Excise taxes.............................................. 17,548 18,376 18,745 9,879 8,984 9,675 1,378 1,289 2,269 15 Customs deposits .................................... 5,150 6,573 7,439 3,748 3,682 3,741 519 584 559 16 Estate and gift taxes.............................. 7,327 5,285 5,411 2,691 2,657 2,900 506 494 459 17 Miscellaneous receipts5 ........................... 6,536 7,413 9,237 4,260 4,501 5,254 1,661 920 1,265 Outlays 18 All types1 ................................................. 402,725 450,836 493,673 238,186 245,616 263,044 47,208 46,566 51,237 19 National defense...................................... 97,501 105,186 117,681 55,124 57,643 62,002 11,174 11,742 11,593 20 International affairs ................................ 4,813 5,922 6,091 2,060 3,538 4,617 885 1,048 837 21 General science, space, and technology . 4,677 4,,742 5,041 2,383 2,461 3,299 545 526 508 22 Energy ..................................................... 4,172 5,861 6,856 4,279 4,417 3,281 471 311 625 23 Natural resources and environment---- 10,000 10,925 12,091 6,020 5,672 7,350 961 970 1,123 24 Agriculture .............................................. 5,532 7,731 6,238 4,967 3,020 1,709 163 340 156 25 Commerce and housing credit............... -44 3,324 2,565 3,292 60 3,002 -122 579 696 26 Transportation ........................................ 14,636 15,445 17,459 8,740 7,688 10,298 1,278 1,469 1,655 27 Community and regional development .. 6,348 11,039 9,482 5,844 4,499 4,855 868 611 718 28 Education, training, employment, social services.............................................. 20,985 26,463 29,685 14,247 14,467 14,579 2,915 2,727 2,861 29 Health ..................................................... 38,785 43,676 49,614 23,830 24,860 26,492 4,562 4,745 5,094 30 Income security1 ...................................... 137,915 146,212 160,198 73,127 81,173 86,007 15,937 15,792 16,456 31 Veterans benefits and services............... 18,038 18,974 19,928 9,532 10,127 10,113 2,775 746 2,006 32 Administration of justice ....................... 3,600 3,802 4,153 1,989 2,096 2,174 347 367 417 33 General government .............................. 3,312 3,737 4,153 2,304 2,291 2,103 394 616 229 34 General-purpose fiscal assistance ......... 9,499 9,601 8,372 4,610 3,890 4,286 51 61 1,739 35 Interest6 ................................................... 38,009 43,966 52,556 24,036 26,934 29,045 4,950 4,630 5,177 36 Undistributed offsetting receipts6-7........ -15,053 -15,772 -18,489 -8,199 -8,999 -12,164 -945 -714 -654 1. Effective June 1978, earned income credit payments in excess of an indi­ 6. Effective September 1976, “Interest” and “Undistributed offsetting receipts” vidual’s tax liability, formerly treated as income tax refunds, are classified as reflect the accounting conversion for the interest on special issues for U.S. gov­ outlays retroactive to January 1976. ernment accounts from an accrual basis to a cash basis. 2. Old-age, disability, and hospital insurance, and railroad retirement accounts. 7. Consists of interest received by trust funds, rents and royalties on the Outer 3. Old-age, disability, and hospital insurance. Continental Shelf, and U.S. government contributions for employee retirement. 4. Supplementary medical insurance premiums, federal employee retirement contributions, and Civil Service retirement and disability fund. Source. “Monthly Treasury Statement of Receipts and Outlays of the U.S. 5. Deposits of earnings by Federal Reserve Banks and other miscellaneous re­ Government” and the Budget of the U.S. Government, Fiscal Year 1981. ceipts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 Domestic Financial Statistics □ June 1980 1.41 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars 1977 1978 1979 1980 Item Dec. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 Dec. 31. Mar. 31 1 Federal debt outstanding..................................................... 729.2 758.8 780.4 797.7 804.6 812.2 833.8 852.2 870.4 2 Public debt securities........................................................... 718.9 749.0 771.5 789.2 796.8 804.9 826.5 845.1 863.5 3 Held by public................................................................. 564.1 587.9 603.6 619.2 630.5 626.4 638.8 658.0 677.1 4 Held by agencies ............................................................. 154.8 161.1 168.0 170.0 166.3 178.5 187.7 187.1 186.3 5 Agency securities................................................................. 10.2 9.8 8.9 8.5 7.8 7.3 7.2 7.1 7.0 6 Held by public................................................................. 8.4 8.0 7.4 7.0 6.3 5.9 5.8 5.6 5.5 7 Held by agencies............................................................. 1.8 1.8 1.5 1.5 1.5 1.5 1.5 1.5 1.5 8 Debt subject to statutory limit........................................... 720.1 750.2 772.7 790.3 797.9 806.0 827.6 846.2 864.5 9 Public debt securities........................................................... 718.3 748.4 770.9 788.6 796.2 804.3 825.9 844.5 862.8 H> Other debt* ........................................................................... 1.7 1.8 1.8 1.7 1.7 1.7 1.7 1.7 1.7 11 Memo. Statutory debt limit............................................... 752.0 752.0 798.0 798.0 798.0 830.0 830.0 879.0 879.0 1. Includes guaranteed debt of government agencies, specified participation cer- Note. Data from Treasury Bulletin (U.S. Treasury Department), tificates, notes to international lending organizations, and District of Columbia stadium bonds. 1.42 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1979 1980 Type and holder 1975 1976 1977 1978 Dec. Jan. Feb. Mar. Apr. 1 Total gross public debt....................................................... 576.6 653.5 718.9 789.2 845.1 847.7 854.6 863.5 870.0 By type 2 Interest-bearing debt........................................................... 575.7 652.5 715.2 782.4 844.0 846.5 853.4 862.2 868.9 3 Marketable ........................................................................... 363.2 421.3 459.9 487.5 530.7 535.7 540.6 557.5 564.9 4 Bills ................................................................................... 157.5 164.0 161.1 161.7 172.6 175.5 177.4 190.8 195.3 5 Notes ................................................................................. 167.1 216.7 251.8 265.8 283.4 284.0 286.8 290.4 291.8 6 Bonds ................................................................................. 38.6 40.6 47.0 60.0 74.7 76.1 76.4 76.3 77.7 7 Nonmarketable1 ................................................................... 212.5 231.2 255.3 294.8 313.2 310.9 312.7 304.7 304.0 8 Convertible bonds2 ......................................................... 2.3 2.3 2.2 2.2 2.2 2.2 2.2 2.2 __ 9 State and local government series................................ 1.2 4.5 13.9 24.3 24.6 24.8 24.5 23.9 23.7 10 Foreign issues3 ................................................................. 21.6 22.3 22.2 29.6 28.8 30.0 29.6 26.9 26.3 11 Government ................................................................. 21.6 22.3 22.2 28.0 23.6 23.6 23.2 20.5 19.8 12 Public ............................................................................. 0 0 0 1.6 5.3 6.4 6.4 6.4 6.4 13 Savings bonds and notes................................................. 67.9 72.3 77.0 80.9 79.9 78.6 77.7 76.0 74.2 14 Government account series4........................................... 119.4 129.7 139.8 157.5 177.5 174.9 178.4 175.5 179.7 15 Non-interest-bearing debt................................................... 1.0 ■ 1.1 3.7 6.8 1.2 1.2 1.2 1.2 1.1 By holder5 16 U.S. government agencies and trust funds.................... 139.1 147.1 154.8 170.0 187.1 184.5 187.8' 184.8 17 Federal Reserve Banks....................................................... 89.8 97.0 102.5 109.6 117.5 116.3 115.2 116.7 18 Private investors................................................................... 349.4 409.5 461.3 508.6 540.5 546.9 551.6 561.9 19 Commercial banks ............................................................... 85.1 103.8 101.4 93.4 97.0 97.1 97.8 99.3 20 Mutual savings banks ......................................................... 4.5 5.9 5.9 5.2 4.2 4.0 4.0 4.2 21 Insurance companies ........................................................... 9.5 12.7 15.1 15.0 14.4 14.4 14.3 14.5 22 Other companies ................................................................. 20.2 27.7 22.7 20.6 23.9 24.5 23.6 25.7 n.a. 23 State and local governments ............................................. 34.2 41.6 55.2 68.6 68.2 71.7 72.1 74.6 Individuals 24 Savings bonds................................................................... 67.3 72.0 76.7 80.1 79.9 78.6 77.6 76.0 25 Other securities ............................................................... 24.0 28.8 28.6 33.7 34.2 34.7 36.7 40.7 26 Foreign and international6................................................. 66.5 78.1 109.6 120.6 123.8 125.1 124.8 119.8 27 Other miscellaneous investors7 ........................................ 38.0 38.9 46.1 88.3 94.8 96.9 100.5 107.1 1. Includes (not shown separately): Securities issued to the Rural Electrification 6. Consists of the investments of foreign balances and international accounts in Administration, depository bonds, retirement plan bonds, and individual retire­ the United States. Beginning with July 1974, the figures exclude non-interestment bonds. bearing notes issued to the International Monetary Fund. 2. These nonmarketable bonds, also known as Investment Series B Bonds, may 7. Includes savings and loan associations, nonprofit institutions, corporate pen­ be exchanged (or converted) at the owner’s option for 1 Vi percent, 5-year mar­ sion trust funds, dealers and brokers, certain government deposit accounts, and ketable Treasury notes. Convertible bonds that have been so exchanged are re­ government sponsored agencies. moved from this category and recorded in the notes category (line 5). Note. Gross public debt excludes guaranteed agency securities and, beginning 3. Nonmarketable dollar-denominated and foreign currency-denominated series in July 1974, includes Federal Financing Bank security issues. held by foreigners. Data by type of security from Monthly Statement of the Public Debt of the United 4. Held almost entirely by U.S. government agencies and trust funds. States (U.S. Treasury Department); data by holder from Treasury Bulletin. 5. Data for Federal Reserve Banks and U.S. government agencies and 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 1980 1980 Type of holder 1978 1979 1978 1979 Feb. Mar. Feb. Mar. All maturities 1 to 5years 1 Ail holders............................................................................................. 487,546 530,731 540,636 557,493 162,886 164,198 168,993 169,599 2 U.S. government agencies and trust funds.................................... 12,695 11,047 10,818 10,800 3,310 2,555 2,281 2,281 3 Federal Reserve Banks....................................................................... 109,616 117,458 115,169 116,657 31,283 28,469 29,268 29,803 4 Private investors................................................................................... 365,235 402,226 414,649 430,036 128,293 133,173 137,444 137,515 5 Commercial banks........................................................................... 68,890 69,076 69,667 69,266 38,390 38,346 39,612 39,149 6 Mutual savings banks ..................................................................... 3,499 3,204 3,812 3,172 1,918 1,668 1,974 1,603 7 Insurance companies....................................................................... 11,635 11,496 11,383 11,666 4,664 4,518 4,249 4,296 8 Nonfinancial corporations ............................................................. 8,272 8,433 8,258 8,328 3,635 2,844 2,471 2,173 9 Savings and loan associations ...................................................... 3,835 3,209 3,131 3,057 2,255 1,763 1,745 1,728 10 State and local governments......................................................... 18,815 15,735 17,845 18,747 3,997 3,487 4,060 4,434 11 All others ......................................................................................... 250,288 291,072 300,553 315,799 73,433 80,546 83,332 84,131 Total, within 1 year 5 to 10 years 12 All holders............................................................................................. 228,516 255,252 258,053 271,642 50,400 50,440 51,132 53,822 13 U.S. government agencies and trust funds.................................... 1,488 1,629 1,381 1,363 1,989 871 1,650 1,650 14 Federal Reserve Banks....................................................................... 52,801 63,219 60,978 61,737 14,809 12,977 11,890 12,021 15 Private investors................................................................................... 174,227 190,403 195,694 208,542 33,601 36,592 37,593 40,151 16 Commercial banks ........................................................................... 20,608 20,171 19,939 20,108 7,490 8,086 7,333 7,583 17 Mutual savings banks ..................................................................... 817 836 1,008 839 496 459 567 473 18 Insurance companies....................................................................... 1,838 2,016 1,930 1,976 2,899 2,815 3,117 3,197 19 Nonfinancial corporations ............................................................. 4,048 4,933 4,503 4,905 369 308 326 387 20 Savings and loan associations ...................................................... 1,414 1,301 1,235 1,178 89 69 92 93 21 State and local governments........................................................ 8,194 5,607 6,712 7,060 1,588 1,540 1,878 1,953 22 All others ......................................................................................... 137,309 155,539 160,367 172,472 20,671 23,314 24,280 26,464 Bills, within 1 year 10 to 20 years 23 All holders............................................................................................. 161,747 172,644 177,422 190,780 19,800 27,588 29,328 29,300 24 U.S. government agencies and trust funds.................................... 2 0 3,876 4,520 3,773 3,772 25 Federal Reserve Banks....................................................................... 42,397 45,337 43,618 43,939 2,088 3,272 3,761 3,803 26 Private investors................................................................................... 119,348 127,306 133,803 146,841 13,836 19,796 21,794 21,725 27 Commercial banks........................................................................... 5,707 5,938 6,054 6,576 956 993 1,348 1,077 28 Mutual savings banks ..................................................................... 150 262 138 207 143 127 180 172 29 Insurance companies....................................................................... 753 473 472 584 1,460 1,305 1,193 1,242 30 Nonfinancial corporations ............................................................. 1,2 2,793 2,534 3,053 86 218 439 348 31 Savings and loan associations ...................................................... 262 219 251 269 60 58 45 44 32 State and local governments ......................................................... 5,524 3,100 4,184 4,110 1,420 1,762 2,007 2,007 33 All others ......................................................................................... 105,161 114,522 120,171 132,041 9,711 15,332 16,582 16,834 Other, within 1 year Over 20 years 34 All holders............................................................................................. 66,769 82,608 80,631 80,862 25,944 33,254 33,130 33,130 35 U.S. government agencies and trust funds.................................... 1,487 1,629 1,381 1,363 2,031 1,472 1,734 1,734 36 Federal Reserve Banks '....................................................................... 10,404 17,882 17,360 17,799 8,635 9,520 9,272 9,293 37 Private investors................................................................................... 54,879 63,097 61,891 61,701 15,278 22,262 22,124 22,104 38 Commercial banks ........................................................................... 14,901 14,233 13,885 13,532 1,446 1,470 1,434 1,350 39 Mutual savings banks ..................................................................... 667 574 869 631 126 113 83 85 40 Insurance companies....................................................................... 1,084 1,543 1,459 1,392 774 842 893 954 41 Nonfinancial corporations ............................................................. 2,256 2,140 1,969 1,852 135 130 520 515 42 Savings and loan associations.................. ................................ 1,152 1,081 985 909 17 19 14 14 43 State and local governments......................................................... 2,670 2,508 2,528 2,950 3,616 3,339 3,188 3,293 44 All others ......................................................................................... 32,149 41,017 40,196 40,435 9,164 16,340 15,993 15,893 Note. Direct public issues only. Based on Treasury Survey of Ownership from 460 mutual savings banks, and 722 insurance companies, each about 80 percent; Treasury Bulletin (U.S. Treasury Department). (2) 419 nonfinancial corporations and 482 savings and loan associations, each about Data complete for U.S. government agencies and trust funds and Federal Re­ 50 percent; and (3) 491 state and local governments, about 40 percent. serve Banks, but data for other groups include only holdings of those institutions “All others,” a residual, includes holdings of all those not reporting in the that report. The following figures show, for each category, the number and pro­ Treasury Survey, including investor groups not listed separately. portion reporting as of Mar. 31, 1980: (1) 5,373 commercial banks, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A34 Domestic Financial Statistics □ June 1980 1.44 U.S. GOVERNMENT SECURITIES DEALERS Transactions Par value; averages of daily figures, in millions of dollars 1980, week ending Wednesday Item 1977 1978 1979 Jan. Feb Jan. 30 Feb. 6' Feb. 13 Feb. 20 Feb. 27 Mar. 5 1 U.S. government securities 10,838 10,285 13,183' 17,508 20,463 15,892 By maturity 2 Bills...................................... 6,746 6,173 7,914 10,512' 9,714 11,723 10,382 10,468 9,910 9,576 9,214 11,499 3 Other within 1 year.......... 237 392 454'' 488 357 380 461 343 437 396 288 352 4 1-5 years ............................ 2,320 1,889 2,417' 2,693' 3,678 2,780 3,158 3,156 4,600 2,912 4,018 2,768 5 5-10 years .......................... 1,148 965 1,121 990 2,006 1,339 883 1,002 2,621 1,490 2,433 2,030 6 Over 10 years .................... 388 867 1,276 1,488 1,753 1,130 1,173 1,369 2,894 1,519 1,474 1,348 By type of customer 7 U.S. government securities dealers ........................ 1,135 1,448 1,363 1,604 1,498 1,033 1,384 1,140 8 U.S. government securities brokers ........................ 3,709 3,838 5,170' 6,699' 7,399 6,934 6,508 7,016 8,835 7,070 6,965 7,133 9 Commercial banks ............ 2,294 1,804 1,905 2,026 2,243 2,313 1,867 2,070 2,994 1,944 1,934 2,220 10 All others1 .......................... 3,567 3,508 4,660' 5,726' 6,504 6,614 5,988 5,647 7,136 5,845 7,144 7,504 11 Federal agency securities .. 1,895 2,724 2,838 3,049 2,923 1. Includes, among others, all other dealers and brokers in commodities and Transactions are market purchases and sales of U.S. government securities deal­ securities, foreign banking agencies, and the Federal Reserve System. ers reporting to the Federal Reserve Bank of New York. The figures exclude allotments of, and exchanges for, new U.S. government securities, redemptions Note. Averages for transactions are based on number of trading days in the of called or matured securities, or purchases or sales of securities under repurchase, period. 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 1980 1979 and 1980, week ending Wednesday Item 1977 1978 1979 Jan. Feb.' Mar. Jan. 9 Jan. 16 Jan. 23 Jan. 30 Feb. 6 Feb. 13 Positions1 1 U.S. government securities ........ 5,172 2,656 3,223 3,443 2,729 2,341 2,418 3,456 3,585 4,362 4,128 3,327 2 Bills................................................ 4,772 2,452 3,813 4,386 2,939 3,000 3,197 4,332 5,061 5,012 5,009 3,200 3 Other within 1 year.................... 99 260 -325 -1,094 -792 -764 -1,087 -1,105 -1,134 -1,052 -924 -829 4 1-5 years ...................................... 60 -92 -455 -305 28 -518 -311 -453 -835 225 83 5 5 5-10 years .................................... 92 40 160 123 327 336 253 196 120 -53 -135 658 6 Over 10 years .............................. 149 -4 30 333 226 286 367 485 373 231 94 292 7 Federal agency securities............ 693 606 1,471 998 236 284 1,016 1,122 890 862 785 396 Financing2 8 All sources .................................... 9,877 10,204 16,003 16,097 15,997 14,236 14,581 16,406 17,424 16,388 17,378 16,447 Commercial banks 9 New York City........................ 1,313 599 1,396 869 749 -297 380 1,120 1,204 680 1,254 987 10 Outside New York City.......... 1,987 2,174 2,868 3,878 3,661 3,414 3,479 3,673 4,357 4,011 4,225 3,530 11 Corporations3 .............................. 2,358 2,379 3,373 3,672 3,731 3,205 3,915 3,757 3,419 3,647 3,901 4,134 12 All others...................................... 4,155 5,052 4,104 7,678 7,856 7,913 6,807 7,856 8,445 8,050 7,998 7,797 1.New amounts (in terms of par values) of securities owned by nonbank dealer agency securities (through both collateral loans and sales under agreements to firms and dealer departments of commercial banks on a commitment, that is, repurchase), plus internal funds used by bank dealer departments to finance po­ trade-date basis, including any such securities that have been sold under agree­ sitions in such securities. Borrowings against securities held under agreeement to ments to repurchase. The maturities of some repurchase agreements are sufficiently resell are excluded when the borrowing contract and the agreement to resell are long, however, to suggest that the securities involved are not available for trading equal in amount and maturity, that is, a matched agreement. purposes. Securities owned, and hence dealer positions, do not include securities 3.All business corporations except commercial banks and insurance companies. purchased under agreement to resell. 2.Total amounts outstanding of funds borrowed by nonbank dealer firms and Note. Averages for positions are based on number of trading days in the period; dealer departments of commercial banks against U.S. government and federal those for financing, on the number of calendar days in the period. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A35 1.46 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt outstanding Millions of dollars, end of period 1979 1980 Agency 1976 1977 1978 Sept. Oct. Nov. Dec. Jan. Feb. 1 Federal and federally sponsored agencies1 ...................... 103,848 112,472 137,063 154,753 158,298' 161,653 163,290 165,819 167,813 2 Federal agencies.................................................................. 22,419 22,760 23,488 24,341 24,151r 24,224 24,715 24,883 25,013 3 Defense Department2 ..................................................... 1,113 983 968 767 757' 748 738 729 719 4 Export-Import Bank3 4 .................................................. 8,574 8,671 8,711 8,886 8,881 8,812 9,191 9,176 9,144 5 Federal Housing Administration5................................ 575 581 588 551 547 545 537 539 546 6 Government National Mortgage Association participation certificates6 ...................................... 4,120 3,743 3,141 3,004 3,004 3,004 2,979 2,979 2,979 7 Postal Service7 ................................................................. 2,998 2,431 2,364 1,837 1,837 1,837 1,837 1,837 1,837 8 Tennessee Valley Authority........................................... 4,935 6,015 7,460 8,850 8,670 8,825 8,997 9,182 9,347 9 United States Railway Association7............................ 104 336 356 446 455 453 436 441 441 10 Federally sponsored agencies1 ........................................... 81,429 89,712 113,575 130,412 134,147 137,429 138,575 140,936 142,800 11 Federal Home Loan Banks .......................................... 16,811 18,345 27,563 30,303 31,874 33,296 33,330 33,122 33,102 12 Federal Home Loan Mortgage Corporation.............. 1,690 1,686 2,262 2,622 2,621 2,621 2,771 2,769 2,764 13 Federal National Mortgage Association...................... 30,565 31,890 41,080 46,378 46,861 47,278 48,486 49,031 50,139 14 Federal Land Banks ....................................................... 17,127 19,118 20,360 17,075 16,006 16,006 16,006 15,106 15,106 15 Federal Intermediate Credit Banks ............................ 10,494 11,174 11,469 2,676 2,676 2,676 2,676 2,144 2,144 16 Banks for Cooperatives ................................................. 4,330 4,434 4,843 785 584 584 584 584 584 17 Farm Credit Banks1......................................................... 2,548 5,081 29,297 32,189 33,547 33,216 36,584 37,240 18 Student Loan Marketing Association8........................ 410 515 915 1,275 1,335 1,420 1,505 1,595 1,720 19 Other ................................................................................. 2 2 2 1 1 1 1 1 1 Memo: 20 Federal Financing Bank debt7’9........................................ 28,711 38,580 51,298 64,211 65,583 66,281 67,383 68,294 69,268 Lending to federal and federally sponsored agencies 21 Export-Import Bank4 ......................................................... 5,208 5,834 6,898 7,953 7,953 7,953 8,353 8,353 8,353 22 Postal Service7 ..................................................................... 2,748 2,181 2,114 1,587 1,587 1,587 1,587 1,587 1,587 23 Student Loan Marketing Association8............................ 410 515 915 1,275 1,335 1,420 1,505 1,595 1,720 24 Tennessee Valley Authority.............................................. 3,110 4,190 5,635 7,125 6,945 7,100 7,272 7,457 7,622 25 United States Railway Association7................................ 104 336 356 446 455 453 436 441 441 Other Lending10 26 Farmers Home Administration ........................................ 10,750 16,095 23,825 31,080 31,670 31,950 32,050 32,145 32,565 27 Rural Electrification Administration .............................. 1,415 2,647 4,604 5,926 6,157 6,272 6,484 6,701 6,874 28 Other ..................................................................................... 4,966 6,782 6,951 8,819c 9,481 9,546 9,696 10,015 10,106 1. In September 1977 the Farm Credit Banks issued their first consolidated of Housing and Urban Development; Small Business Administration; and the bonds, and in January 1979 they began issuing these bonds on a regular basis to Veterans Administration. replace the financing activities of the Federal Land Banks, the Federal Interme­ 7. Off-budget. diate Credit Banks, and the Banks for Cooperatives. Line 17 represents those 8. Unlike other federally sponsored agencies, the Student Loan Marketing As­ consolidated bonds outstanding, as well as any discount notes that have been sociation may borrow from the Federal Financing Bank (FFB) since its obligations issued. Lines 1 and 10 reflect the addition of this item. are guaranteed by the Department of Health, Education, and Welfare. 2. Consists of mortgages assumed by the Defense Department between 1957 9. The FFB, which began operations in 1974, is authorized to purchase or sell and 1963 under family housing and homeowners assistance programs. obligations issued, sold, or guaranteed by other federal agencies. Since FFB incurs 3. Includes participation certificates reclassified as debt beginning Oct. 1, 1976. debt solely for the purpose of lending to other agencies, its debt is not included 4. Off-budget Aug. 17, 1974, through Sept. 30, 1976; on-budget thereafter. in the main portion of the table in order to avoid double counting. 5. Consists of debentures issued in payment of Federal Housing Administration 10. Includes FFB purchases of agency assets and guaranteed loans; the latter insurance claims. Once issued, these securities may be sold privately on the se­ contain loans guaranteed by numerous agencies with the guarantees of any par­ curities market. ticular agency being generally small. The Farmers Home Administration item 6. Certificates of participation issued prior to fiscal 1969 by the Government consists exclusively of agency assets, while the Rural Electrification Administration National Mortgage Association acting as trustee for the Farmers Home Admin­ entry contains both agency assets and guaranteed loans. istration; Department of Health, Education, and Welfare; Department Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 Domestic Financial Statistics □ June 1980 1.47 NEW SECURITY ISSUES of State and Local Governments Millions of dollars 1979 1980 Type of issue or issuer, 1977 1978 1979 Sept. Oct. Nov. Dec. Jan.P Feb.P 1 All issues, new and refunding1....................................................... 46,769 48,607 43,490 2,479 4,229 4,172 3,583 3,013 2,350 Type of issue 2 General obligation........................................................................... 18,042 17,854 12,109 699 1,037 • 805 855 1,151 987 3 Revenue ........................................................................................... 28,655 30,658 31,256 1,773 3,180 3,355 2,712 1,856 1,353 4 Housing Assistance Administration2 .......................................... 5 U.S. government loans................................................................... 72 95 125 7 12 12 16 6 10 Type of issuer 6 State ................................................................................................... 6,354 6,632 4,314 113 294 274 569 699 327 7 Special district and statutory authority...................................... 21,717 24,156 23,434 1,404 2,749 2,697 2,102 1,379 1,202 8 Municipalities, counties, townships, school districts................ 18,623 17,718 15,617 955 1,174 1,189 896 929 811 9 Issues for new capital, total........................................................... 36,189 37,629 41,505 2,436 4,171 3,702 3,186 3,000 2,340 Use of proceeds 10 Education ......................................................................................... 5,076 5,003 5,130 218 311 298 408 220 366 11 Transportation ................................................................................. 2,951 3,460 2,441 38 562 97 214 172 176 12 Utilities and conservation............................................................... 8,119 9,026 8,594 336 1,426 515 409 547 326 13 Social welfare ................................................................................... 8,274 10,494 15,968 1,082 1,191 2,042 1,724 1,285 1,050 14 Industrial aid ................................................................................... 4,676 3,526 3,836 382 427 369 157 51 68 15 Other purposes................................................................................. 7,093 6,120 5,536 380 254 381 274 725 354 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 contri­ butions to tne local authority. 1.48 NEW SECURITY ISSUES of Corporations Millions of dollars 1979 1980 Type of issue or issuer, or use 1977 1978 1979 Aug. Sept. Oct. Nov. Dec. Jan. Feb. 1 All issues1 ................................................................ 53,792 47,230 51,102 4,083 4,308 4,561 3,834 3,774 5,740 4,114 2 Bonds ............................................................................. 42,015 36,872 39,690 2,859 3,021 3,532 2,589 2,441 4,397 2,518 Type of offering 3 Public ........................................................................ 24,072 19,815 25,815 1,973 2,167 2,669 1,583 1,500 2,450 1,426 4 Private placement ................................................... 17,943 17,057 13,877 886 854 863 1,006 941 1,947 1,092 Industry group 5 Manufacturing ......................................................... 12,204 9,572 9,590 806 1,095 1,334 322 265 774 831 6 Commercial and miscellaneous .............................. 6,234 5,246 3,939 413 361 214 207 455 503 244 7 Transportation ......................................................... 1,996 2,007 3,054 171 175 296 257 187 313 153 8 Public utility ............................................................. 8,262 7,092 8,058 137 620 1,107 663 743 1,338 568 9 Communication ........................................................... 3,063 3,373 4,198 336 418 433 854 55 483 518 10 Real estate and financial............................................ 10,258 9,586 10,853 996 353 147 287 737 987 205 11 Stocks ........................................................................ 11,777 10,358 11,410 1,224 1,287 1,029 1,245 1,333 1,343 1,596 Type 12 Preferred .................................................................. 3,916 2,832 3,650 401 698 195 465 289 290 88 13 Common .................................................................. 7,861 7,526 7,760 823 589 834 780 1,044 1,053 1,508 Industry group 14 Manufacturing ......................................................... 1,189 1,241 1,686 360 394 151 158 231 324 380 15 Commercial and miscellaneous .............................. 1,834 1,816 2,623 266 218 98 286 430 313 426 16 Transportation ............................................................. 456 263 255 142 4 2 59 58 17 Public utility ............................................................. 5,865 5,140 5,218 366 527 662 607 365 506 627 18 Communication ........................................................... 1,379 264 303 83 47 2 1 39 19 Real estate and financial.......................................... 1,049 1,631 1,324 91 61 70 190 306 140 65 1. Figures, which represent gross proceeds of issues maturing in more than one 1933, employee stock plans, investment companies other than closed-end, intra­ year, sold for cash in the United States, are principal amount or number of units corporate transactions, and sales to foreigners, multiplied by offering price. Excludes offerings of less than $100,000, secondary offerings, undefined or exempted issues as defined in the Securities Act of Source. Securities and Exchange Commission. 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 1979 1980 Item 1978 1979 Sept. Nov. Dec. Jan. Feb. Mar. Apr. Investment Companies1 1 Sales of own shares2........................................................... 6,645 7,495 580 690 748 957 773 723 1,011 2 Redemptions of own shares3............................................. 7,231 8,393 784 579 743 776 882 892 762 3 Net sales ............................................................................... -586 -898 -204 111 5 181 -109 -169 249 4 Assets4 ................................................................................... 44,980 49,493 50,147 48,613 49,277 51,278 49,512 44,581 47,234 5 Cash position5................................................................... 4,507 4,983 5,016 4,984 4,983 5,702 5,895 5,644 5,831 6 Other ................................................................................. 40,473 44,510 45,131 43,629 44,294 45,576 43,617 38,937 41,403 1. Excluding money market funds. 5. Also includes all U.S. government securities and other short-term debt se­ 2. Includes reinvestment of investment income dividends. Excludes reinvest­ curities. ment of capital gains distributions and share issue of conversions from one fund to another in the same group. Note. Investment Company Institute data based on reports of members, which 3. Excludes share redemption resulting from conversions from one fund to an­ comprise substantially all open-end investment companies registered with the Se­ other in the same group. curities and Exchange Commission. Data reflect newly formed companies after 4. Market value at end of period, less current liabilities. their initial offering of securities. 1.50 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1978 1979 1980 Account 1977 1978 1979 Q3 Q4 Ql Q2 Q3 Q4 Ql 1 Profits before tax ......................................................... 177.1 206.0 236.6 212.0 227.4 233.3 227.9 242.3 243.0 257.1 2 Profits tax liability..................................................... 72.6 84.5 92.5 87.5 95.1 91.3 88.7 94.0 96.1 101.7 3 Profits after tax ........................................................... 104.5 121.5 144.1 124.5 132.3 142.0 139.3 148.3 146.9 155.4 4 Dividends ................................................................. 42.1 47.2 52.7 47.8 49.7 51.5 52.3 52.8 54.4 56.7 5 Undistributed profits ............................................... 62.4 74.3 91.4 76.8 82.6 90.5 87.0 95.5 92.5 98.7 6 Capital consumption allowances .............................. 109.3 119.8 131.0 120.6 123.1 125.5 130.4 132.8 135.2 137.4 7 Net cash flow ............................................................... 171.7 194.1 222.4 197.3 205.7 216.0 217.3 228.3 227.7 236.1 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 Financial Statistics □ June 1980 1.51 NONFINANCIAL CORPORATIONS Current Assets and Liabilities Billions of dollars, except for ratio 1978 1979 Account 1975 1976 1977 Q2 Q3 Q4 Ql Q2 Q3 Q4 1 Current assets............................................................... 759.0 826.3 900.9 954.2 992.6 1,028.1 1,078.6 1,110.6 1,169.6 1,199.9 2 Cash ............................................................................... 82.1 87.3 94.3 91.3 91.7 103.7 102.4 100.1 103.6 116.2 3 U.S. government securities ...................................... 19.0 23.6 18.7 17.3 16.1 17.8 19.2 20.8 17.8 17.8 4 Notes and accounts receivable.................................. 272.1 293.3 325.0 356.0 376.4 381.9 405.3 419.0 448.9 451.7 5 Inventories ................................................................... 315.9 342.9 375.6 399.3 415.5 428.3 452.6 469.2 492.7 503.9 6 Other ............................................................................. 69.9 79.2 87.3 90.3 92.9 96.3 99.1 101.5 106.7 110.3 7 Current liabilities ......................................................... 451.6 492.7 546.8 593.5 626.0 661.9 701.6 723.9 773.7 803.7 8 Notes and accounts payable...................................... 264.2 282.0 313.7 338.0 356.2 375.1 392.6 410.8 443.1 460.8 9 Other ............................................................................. 187.4 210.6 233.1 255.6 269.7 286.8 309.0 313.2 330.6 342.8 10 Net working capital ..................................................... 307.4 333.6 354.1 360.6 366.6 366.2 377.0 386.7 395.9 396.3 11 Memo: Current ratio 1 ............................................... 1.681 1.677 1.648 1.608 1.586 1.553 1.537 1.534 1.512 1.493 1. Ratio of total current assets to total current liabilities. All data in this table reflect the most current benchmarks. Complete data are available upon request from the Flow of Funds Section, Division of Research and Note: For a description of this series, see “Working Capital of Nonfinancial Statistics. Corporations” in the July 1978 Bulletin, pp. 533-37. Source. Federal Trade Commission. 1.52 BUSINESS EXPENDITURES on New Plant and Equipment Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1979 1980 Industry 1978 1979 Ql Q2 Q3 Q4 Ql Q22 Q32 Q42 1 All industries................................................................. 153.82 177.09 165.94 173.48 179.33 186.95 191.36 191.00 195.54 199.41 Manufacturing 2 Durable goods industries ........................................... 31.66 38.23 34.00 36.86 39.72 41.30 42.30 42.18 43.70 44.06 3 Nondurable goods industries .................................... 35.96 40.69 37.56 39.56 40.50 43.88 45.01 44.64 47.28 48.07 Nonmanufacturing 4 Mining ........................................................................... 4.78 5.56 5.46 5.31 5.42 6.06 6.02 6.72 5.88 6.14 Transportation 5 Railroad ..................................................................... 3.32 3.93 4.02 3.66 4.03 4.20 4.40 3.80 3.58 4.16 6 Air ............................................................................. 2.30 3.24 3.35 3.26 3.10 3.39 2.98 4.33 4.23 3.47 7 Other ......................................................................... 2.43 2.95 2.71 2.79 3.16 3.15 2.94 3.03 3.17 3.58 Public utilities 8 Electric....................................................................... 29.48 32.56 27.70 28.06 28.32 26.02 28.78 27.43 27.02 25.98 9 Gas and other........................................................... 4.70 5.07 4.66 5.18 5.01 5.50 5.57 5.44 5.69 6.19 10 Communication ........................................................... 18.16 20.56 18.75 20.29 20.41 22.71 22.48 11 Commercial and other1 ............................................... 25.71 29.35 27.73 28.51 29.66 30.72 30.86 > 53.43 J. 55.00 > 57.76 1. Includes trade, service, construction, finance, and insurance. ture; real estate operators; medical, legal, educational, and cultural service; and 2. Anticipated by business. nonprofit organizations. Note. Estimates for corporate and noncorporate business, excluding agricul- 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 1.53 DOMESTIC FINANCE COMPANIES Assets and Liabilities Billions of dollars, end of period 1979 1980 Account 1974 1975 1976 1977 1978 Ql Q2 Q3 Q4 Ql Assets Accounts receivable, gross 1 Consumer ............................................................................. 36.1 36.0 38.6 44.0 52.6 54.9 58.7 62.3 65.7 67.7 2 Business ................................................................................. 37.2 39.3 44.7 55.2 63.3 66.7 70.1 68.1 70.3 70.6 3 Total ................................................................................... 73.3 75.3 83.4 99.2 116.0 121.6 128.8 130.4 136.0 138.4 4 Less: Reserves for unearned income and losses ... 9.0 9.4 10.5 12.7 15.6 16.5 17.7 18.7 20.0 20.4 5 Accounts receivable, net.................................................. 64.2 65.9 72.9 86.5 100.4 105.1 111.1 111.7 116.0 118.0 6 Cash and bank deposits .................................................. 3.0 2.9 2.6 2.6 3.5 7 Securities ............................................................................... .4 1.0 1.1 .9 1.3 23.81 24.6 25.8 24.9 23.7 8 Ail other ............................................................................... 12.0 11.8 12.6 14.3 17.3 9 Total assets ............................................................... 79.6 81.6 89.2 104.3 122.4 128.9 135.8 137.4 140.9 141.7 Liabilities 10 Bank loans .......................................................................... 9.7 8.0 6.3 5.9 6.5 6.5 7.3 7.8 8.5 9.7 11 Commercial paper ...................................... .................. 20.7 22.2 23.7 29.6 34.5 38.1 41.0 39.2 43.3 40.8 Debt 12 Short-term, n.e.c.............................................................. 4.9 4.5 5.4 6.2 8.1 6.7 8.8 9.1 8.2 7.4 13 Long-term n.e.c............................................................... 26.5 27.6 32.3 36.0 43.6 44.5 46.0 47.5 46.7 48.9 14 Other ................................................................................. 5.5 6.8 8.1 11.5 12.6 15.1 14.4 15.4 14.2 15.7 15 Capital, surplus, and undivided profits .................... 12.4 12.5 13.4 15.1 17.2 18.0 18.2 18.4 19.9 19.2 16 Total liabilities and capital ...................................... 79.6 81.6 89.2 104.3 122.4 128.9 135.8 137.4 140.9 141.7 1. Beginning Ql 1979, asset items on lines 6, 7, and 8 are combined. Note. Components may not add to totals due to rounding. 1.54 DOMESTIC FINANCE COMPANIES Business Credit Millions of dollars, seasonally adjusted except as noted Changes in accounts Extensions Repayments Accounts receivable receivable Type ou M ts a t r a . n 3 d 1 in , g 1980 1980 1980 19801 Jan. Feb. Mar. Jan. Feb. Mar. Jan. Feb. Mar. 1 Total ................................................................... 70,647 -473 302 -5 16,918 17,843 17,370 17,391 17,541 17,375 2 Retail automotive (commercial vehicles)........ 14,824 -55 24 -250 1,127 1,172 952 1,182 1,148 1,202 3 Wholesale automotive ......................................... 12,990 -849 -315 -415 5,094 5,339 4,917 5,943 5,654 5,332 4 Retail paper on business, industrial and farm equipment ........................................... 19,403 555 419 680 1,468 1,529 1,614 913 1,110 934 5 Loans on commercial accounts receivable and factored commercial accounts receivable . 7,509 180 111 153 7,085 7,782 7,908 6,905 7,671 7,755 6 All other business credit..................................... 15,921 -304 63 -173 2,144 2,021 1,979 2,448 1,958 2,152 1. Not seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A40 Domestic Financial Statistics □ June 1980 1.55 MORTGAGE MARKETS Millions of dollars; exceptions noted. . 197$, 1980 Item 1976 1977 1978 Nov. Dec. Jan. Feb. Mar. Apr. Terms and yields in primary and secondary markets Primary Markets Conventional mortgages on new homes Terms1 1 Purchase price (thousands of dollars).......... 48.4 54.3 62.6 77.1 79.4 76.9 79.8 77.7 83.1 2 Amount of loan (thousands of dollars)----- 35.9 40.5 45.9 55.4 56.0 54.4 56.6 55.1 59.4 3 Loan/price ratio (percent) ............................ 74.2 76.3 75.3 73.8 72.9 73.0 72.5 72.0 73.6 4 Maturity (years) ............................................... 27.2 27.9 28.0 28.5 28.8 28.1 28.8 27.4 28.3 5 Fees and charges (percent of loan amount)2 1.44 1.33 1.39 1.82 1.85 2.11 1.79 1.98 2.04 6 Contract rate (percent per annum).............. 8.76 8.80 9.30 11.04 11.30 11.48 11.60 12.25 12.64 Yield (percent per annum) 7 FHLBB series3 ................................................. 8.99 9.01 9.54 11.37 11.64 11.87 11.93 12.62 13.03 8 HUD series4 ..................................................... 8.99 8.95 9.68 12.50 12.50 12.80 14.10 16.05 15.55 Secondary Markets Yield (percent per annum) 9 FHA mortgages (HUD series)5.................... 8.82 8.68 9.70 12.41 12.24 12.60 n.a. 14.63 13.45 10 GNMA securities6 ........................................... 8.17 8.04 8.98 11.57 11.35 11.94 13.16 13.79 12.55 FNMA auctions7 11 Government-underwritten loans .............. 8.99 8.73 9.77 12.75 12.48 12.90 14.48 15.64 14.61 12 Conventional loans ..................................... 9.11 8.98 10.01 13.66 12.98 13.20 14.12 16.62 16.29 Activityin secondarymarkets Federal National Mortgage Association Mortgage holdings (end of period) 13 Total.......................................................................... 32,904 34,370 43,311 50,350 51,091 52,106 53,063 53,990 54,843 14 FHA-insured ......................................................... 18,916 18,457 21,243 24,178 24,489 24,906 25,146 n.a. n.a. 15 VA-guaranteed ..................................................... 9,212 9,315 10,544 10,374 10,496 10,653 10,885 n.a. n.a. 16 Conventional......................................................... 4,776 6,597 11,524 15,797 16,106 16,546 16,853 17,079 17,453 Mortgage transactions (during period) 17 Purchases.................................................................. 3,606 4,780 12,303 872 893 1,163 1,087' 1,063 1,021 18 Sales .......................................................................... 86 67 5 0 0 0 0 0 0 Mortgage commitments8 19 Contracted (during period) .................................... 6,247 9,729 18,960 496 402 508 999 825 507 20 Outstanding (end of period) .................................. 3,398 4,698 9,201 6,974 6,409 5,671 5,504 5,078 4,371 Auction of 4-month commitments to buy Government-underwritten loans 21 Offered9..................................................................... 4,929.8 7,974.1 12,978 558.4 649.2 516.0 1,169.4 1,267.3 493.7 22 Accepted ............................................................... 2,787.2 4,846.2 6,747.2 264.6 249.3 213.8 563.7 426.1 199.4 Conventional loans 23 Offered9................................................................ 2,595.7 5.675.2 9,933.0 366.1 413.2 443.1 412.1 918.6 135.2 24 Accepted ............................................................... 1,879.2 3,917.8 5,110.9 190.2 152.4 247.2 147.8 239.9 65.8 Federal Home Loan Mortgage Corporation Mortgage holdings (end of period)10 25 Total.......................................................................... 4,269 3,276 3,064 3,990 4,035 4,124 4,145 4,235 4,255 26 FHA/VA ............................................................... 1,618 1,395 1,243 1,112 1,102 1,098 1,092 1,086 1,080 27 Conventional......................................................... 2,651 1,881 1,822 2,879 2,933 3,026 3,052 3,149 3,175 Mortgage transactions (during period) 28 Purchases.................................................................. 1,175 3,900 6,524 458 403 280 248 193 231 29 Sales .......................................................................... 1,396 4,131 6,211 186 361 180 207 106 199 Mortgage commitments11 30 Contracted (during period) .................................... 1,477 5,546 7,451 221 199 296 197 186 189 31 Outstanding (end of period) .................................. 333 1,063 1,410 1,036 797 779 726 700 643 1. Weighted averages based on sample surveys of mortgages originated by major securities, assuming prepayment in 12 years on pools of 30-year FHA/VA mort­ institutional lender groups. Compiled by the Federal Home Loan Bank Board in gages carrying the prevailing ceiling rate. Monthly figures are unweighted averages cooperation with the Federal Deposit Insurance Corporation. of Monday quotations for the month. 2. Includes all fees, commissions, discounts, and “points” paid (by the borrower 7. Average gross yields (before deduction of 38 basis points for mortgage or the seller) in order to obtain a loan. servicing) on accepted bids in Federal National Mortgage Association’s auctions 3. Average effective interest rates on loans closed, assuming prepayment at the of 4-month commitments to purchase home mortgages, assuming prepayment in end of 10 years. 12 years for 30-year mortgages. No adjustments are made for FNMA commitment 4. Average contract rates on new commitments for conventional first mortgages, fees or stock related requirements. Monthly figures are unweighted averages for rounded to the nearest 5 basis points; from Department of Housing and Urban auctions conducted within the month. Development. 8. Includes some multifamily and nonprofit hospital loan commitments in ad­ 5. Average gross yields on 30-year, minimum-downpayment, Federal Housing dition to 1- to 4-family loan commitments accepted in FNMA’s free market auction Administration-insured first mortgages for immediate delivery in the private sec­ system, and through the FNMA-GNMA tandem plans. ondary market. Any gaps in data are due to periods of adjustment to changes in 9. Mortgage amounts offered by bidders are total bids received. maximum permissible contract rates. 10. Includes participation as well as whole loans. 6. Average net yields to investors on Government National Mortgage Associ­ 11. Includes conventional and government-underwritten loans. ation guaranteed, mortgage-backed, fully modified pass-through Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Real Estate Debt A41 1.56 MORTGAGE DEBT OUTSTANDING Millions of dollars, end of period 1979 1980 Type of holder, and type of property 1977 1978 1979 Ql Q2 Q3 Q4 Ql 1AH holders........................................................................ 1,023,505 1,172,754 1,333,550r 1,206,213 1,252,426 1,295,935' l,333,550r 1,362,802 2 1- to 4-family ....................................................................... 656,566 761,843 872,068' 784,546 816,940 846,287' 872,068' 890,189 3Multifamily ........................................................................... 111,841 121,972 130,713r 123,965 125,916 128,270' 130,713' 132,795 4Commercial........................................................................... 189,274 212,746 238,412' 217,495 224,499 232,208' 238,412' 243,839 5 65,824 76,193 92,357' 80,207 85,071 89,170' 92,357' 95,979 6Major financial institutions ............................................... 745,011 848,095 939,487' 865,974 894,385 920,231' 939,487' 951,898 7 Commercial banks1 ......................................................... 178,979 213,963 245,998' 220,063 229,564 239,627' 245,998' 251,198 8 1- to 4-family ............................................................... 105,115 126,966 145,975' 130,585 136,223 142,195' 145,975' 149,061 9 Multifamily ................................................................... 9,215 10,912 12,546' 11,223 11,708 12,221' 12,546' 12,811 10 Commercial ................................................................... 56,898 67,056 77,096' 68,968 71,945 75,099' 77,096' 78,725 11 Farm............................................................................... 7,751 9,029 10,381' 9,287 9,688 10,112' 10,381' 10,601 12 Mutual savings banks ..................................................... 88,104 95,157 98,908' 96,136 97,155 97,929 98,908' 99,151 13 1- to 4-family ............................................................... 57,637 62,252 64,706' 62,892 63,559 64,065 64,706' 64,865 14 Multifamily ................................................................... 15,304 16,529 17,180' 16,699 16,876 17,010 17,180' 17,223 15 Commercial ................................................................... 15,110 16,319 16,963' 16,488 16,662 16,795 16,963' 17,004 16 Farm............................................................................... 53 57 59 57 58 59 59 59 17 Savings and loan associations........................................ 381,163 432,808 475,797 441,358 456,543 468,307 475,797 479,078 18 1- to 4-family ............................................................... 310,686 356,114 394,436 363,723 377,516 387,992 394,436 397,156 19 Multifamily ................................................................... 32,513 36,053 37,588 36,677 37,071 37,277 37,588 37,847 20 Commmercial ............................................................... 37,964 40,641 43,773 40,958 41,956 43,038 43,773 44,075 21 Life insurance companies.............................................. 96,765 106,167 118,784 108,417 111,123 114,368 118,784 122,471 22 1- to 4-family .............................................................. 14,727 14,436 16,193 14,507 14,489 14,884 16,193 16,850 23 Multifamily ................................................................... 18,807 19,000 19,274 19,080 19,102 19,107 19,274 19,590 24 Commercial ................................................................... 54,388 62,232 71,137 63,908 66,055 68,513 71,137 73,618 25 Farm............................................................................... 8,843 10,499 12,180 10,922 11,477 11,864 12,180 12,413 26 Federal and related agencies............................................ 70,006 81,853 97,293 86,689 90,095 93,143 97,293 104,045 27 Government National Mortgage Association............ 3,660 3,509 3,852 3,448 3,425 3,382 3,852 3,919 28 1- to 4-family ............................................................... 1,548 877 763 821 800 780 763 749 29 Multifamily ................................................................... 2,112 2,632 3,089 2,627 2,625 2,602 3,089 3,170 30 Farmers Home Administration .................................... 1,353 926 1,274 956 1,200 1,383 1,274 2,757 31 1- to 4-family ............................................................... 626 288 417 302 363 163 417 1,139 32 Multifamily ................................................................... 275 320 71 180 75 299 71 408 33 Commercial ................................................................... 149 101 174 283 278 262 174 409 34 Farm ............................................................................... 303 217 612 191 484 659 612 801 35 Federal Housing and Veterans Administration........ 5,212 5,419 5,764 5,522 5,597 5,672 5,764 5,833 36 1- to 4-family ............................................................... 1,627 1,641 1,863 1,693 1,744 1,795 1,863 1,908 37 Multifamily ................................................................... 3,585 3,778 3,901 3,829 3,853 3,877 3,901 3,925 38 Federal National Mortgage Association...................... 34,369 43,311 51,091 46,410 48,206 49,173 51,091 53,990 39 1- to 4-family ............................................................... 28,504 37,579 45,488 40,702 42,543 43,534 45,488 48,394 40 Multifamily ................................................................... 5,865 5,732 5,603 5,708 5,663 5,639 5,603 5,596 41 Federal Land Banks ....................................................... 22,136 25,624 31,277 26,893 28,459 29,804 31,277 33,311 42 1- to 4-family ............................................................... 670 927 1,552 1,042 1,198 1,374 1,552 1,708 43 Farm............................................................................... 21,466 24,697 29,725 25,851 27,261 28,430 29,725 31,603 44 Federal Home Loan Mortgage Corporation.............. 3,276 3,064 4,035 3,460 3,208 3,729 4,035 4,235 45 1- to 4-family ............................................................... 2,738 2,407 3,059 2,685 2,489 2,850 3,059 3,210 46 Multifamily ................................................................... 538 657 976 775 719 879 976 1,025 47 Mortgage pools or trusts2................................................... 70,289 88,633 119,278 94,551 102,259 110,648 119,278 124,097 48 Government National Mortgage Association ............ 44,896 54,347 76,401 57,955 63,000 69,357 76,401 80,905 49 1- to 4-family ............................................................... 43,555 52,732 74,546 56,269 61,246 67,535 74,546 78,934 50 Multifamily ................................................................... 1,341 1,615 1,855 1,686 1,754 1,822 1,855 1,971 51 Federal Home Loan Mortgage Corporation.............. 6,610 11,892 15,180 12,467 13,708 14,421 15,180 15,454 52 1- to 4-family ............................................................... 5,621 9,657 12,149 10,088 11,096 11,568 12,149 12,359 53 Multifamily ................................................................... 989 2,235 3,031 2,379 2,612 2,853 3,031 3,095 54 Farmers Home Administration .................................... 18,783 22,394 27,697 24,129 25,551 26,870 27,697 27,738 55 1- to 4-family ............................................................... 11,397 13,400 14,884 13,883 14,329 14,972 14,884 14,926 56 Multifamily ................................................................... 759 1,116 2,163 1,465 1,764 1,763 2,163 2,159 57 Commercial ................................................................... 2,945 3,560 4,328 3,660 3,833 4,054 4,328 4,495 58 Farm............................................................................... 3,682 4,318 6,322 5,121 5,625 6,081 6,322 6,158 59 Individual and others3......................................................... 138,199 154,173 177,492' 158,999 165,687 171,913' 177,492' 182,762 60 1- to 4-family ................................................................... 72,115 82,567 96,037' 85,354 89,345 92,580' 96,037' 98,930 61 Multifamily ....................................................................... 20,538 21,393 23,436' 21,637 22,094 22,921' 23,436' 23,975 62 Commerical ....................................................................... 21,820 22,837 24,941' 23,230 23,770 24,447' 24,941' 25,513 63 Farm................................................................................... 23,726 27,376 33,078' 28,778 30,478 31,965' 33,078' 34,344 1. Includes loans held by nondeposit trust companies but not bank trust depart­ Note. Based on data from various institutional and governmental sources, with ments. some quarters estimated in part by the Federal Reserve in conjunction with the 2.Outstanding principal balances of mortgages backing securities insured or Federal Home Loan Bank Board and the Department of Commerce. Separation guaranteed by the agency indicated. of nonfarm mortgage debt by type of property, if not reported directly, and in­ 3.Other holders include mortgage companies, real estate investment trusts, state terpolations and extrapolations wnen required, are estimated mainly by the Federal and local credit agencies, state and local retirement funds, noninsured pension Reserve. Multifamily debt refers to loans on structures of five or more units. funds, credit unions, and U.S. agencies for which amounts are small or separate data are not readily available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A42 Domestic Financial Statistics □ June 1980 1.57 CONSUMER INSTALLMENT CREDIT1 Total Outstanding, and Net Change Millions of dollars 1979 1980 Holder, and type of credit 1977 1978 1979 Jan. Feb. Apr. Amounts outstanding (end of period) 1 Total .............................. 275,629 305,217 307,641 311,122 308,984 307,621 306,131 By major holder 2 Commercial banks ___ 112,373 136,189 149,604 149,152 149,057 149,604 148,868 148,249 147,315 145,405 3 Finance companies----- 44,868 54,298 68,318 65,692 67,164 68,318 68,724 69,545 70,421 71,545 4 Credit unions .............. 37,605 45,939 48,186 48,770 48,673 48,186 47,270 46,707 46,521 45,731 5 Retailers2 ...................... 23,490 24,876 27,916 24,860 25,732 27,916 26,985 26,309 25,841 25,746 6 Savings and loans........ 7,354 8,394 10,361 10,073 10,241 10,361 10,320 10,543 10,755 10,887 7 Gasoline companies ... 2,963 3,240 4,316 4,174 4,281 4,316 4,433 4,467 4,421 4,503 8 Mutual savings banks .. 2,176 2,693 2,421 2,496 2,493 2,421 2,384 2,370 2,347 2,314 By major type of credit 9 Automobile .................. 82,911 102,468 115,022 114,876 115,121 115,022 114,761 115,007 115,281 115,014 10 Commercial banks .. 49,577 60,564 65,229 65,973 65,646 65,229 64,824 64,544 64,047 62,978 11 Indirect paper----- 27,379 33,850 37,209 37,469 37,334 37,209 37,020 36,949 36,821 36,325 12 Direct loans.......... 22,198 26,714 28,020 28,504 28,312 28,020 27,804 27,595 27,226 26,653 13 Credit unions............ 18,099 21,967 23,042 23,322 23,275 23,042 22,604 22,335 22,246 21,868 14 Finance companies .. 15,235 19,937 26,751 25,581 26,200 26,751 27,333 28,128 28,988 30,168 15 Revolving...................... 39,274 47,051 55,330 50,883 52,060 55,330 54,420 53,522 52,662 52,217 16 Commercial banks .. 18,374 24,434 28,954 27,600 27,827 28,954 28,841 28,575 28,241 27,889 17 Retailers.................... 17,937 19,377 22,060 19,109 19,952 22,060 21,146 20,480 20,000 19,825 18 Gasoline companies . 2,963 3,240 4,316 4,174 4,281 4,316 4,433 4,467 4,421 4,503 19 Mobile home................ 15,141 16,042 17,409 17,244 17,349 17,409 17,387 17,476 17,596 17,668 20 Commercial banks .. 9,124 9,553 9,991 10,013 10,036 9,991 9,968 9,974 9,978 9,965 21 Finance companies .. 3,077 3,152 3,390 3,295 3,321 3,390 3,415 3,428 3,475 3,523 22 Savings and loans ... 2,538 2,848 3,516 3,418 3,475 3,516 3,502 3,578 3,650 3,694 23 Credit unions............ 402 489 512 518 517 512 502 496 494 486 24 Other ............................ 93,503 110,068 123,361 122,214 123,111 123,361 122,416 122,185 122,082 121,232 25 Commercial banks .. 35,298 41,638 45,430 45,566 45,548 45,430 45,235 45,156 45,049 44,573 26 Finance companies .. 26,556 31,209 38,177 36,816 37,643 38,177 37,976 37,989 37,958 37,854 27 Credit unions............ 19,104 23,483 24,632 24,930 24,881 24,632 24,164 23,876 23,781 23,377 28 Retailers.................... 5,553 5,499 5,856 5,751 5,780 5,856 5,839 5,829 5,841 5,921 29 Savings and loans ... 4,816 5,546 6,845 6,655 6,766 6,845 6,818 6,965 7,106 7,193 30 Mutual savings banks 2,176 2,693 2,421 2,496 2,493 2,421 2,384 2,370 2,347 2,314 Net change (during period)3 31 Total ........................................................... 35,278 44,810 35,491 2,186 2,407 1,349 1,372 2,295 1,437 -1,985 By major holder 32 Commercial banks ................................... 18,645 23,813 13,414 771 283 218 433 783 17 -2,237 33 Finance companies.................................. 5,948 9,430 14,020 1,076 1,340 1,087 1,096 1,376 1,174 984 34 Credit unions ........................................... 6,436 8,334 2,247 -152 -44 -455 -324 -373 -215 -743 35 Retailers2 .................................................. 2,654 1,386 3,040 335 477 282 120 53 243 -65 36 Savings and loans.................................... 1,111 1,041 1,967 76 143 165 7 306 204 83 37 Gasoline companies................................ 132 276 1,076 122 218 115 50 166 48 14 38 Mutual savings banks.............................. 352 530 -273 -42 -10 -63 -10 -16 -34 -21 By major type of credit 39 Automobile .............................................. 15,204 19,557 12,554 487 533 682 972 881 395 -645 40 Commercial banks .............................. 9,956 10,987 4,665 203 -76 122 83 22 -412 -1,335 41 Indirect paper ................................... 5,307 6,471 3,359 237 40 260 72 48 -86 -698 42 Direct loans...................................... 4,649 4,516 1,306 -34 -116 -138 11 -26 -326 -637 43 Credit unions........................................ 2,861 3,868 1,075 -79 -24 -213 -134 -177 -82 -373 44 Finance companies.............................. 2,387 4,702 6,814 363 633 773 1,023 1,036 889 1,063 45 Revolving.................................................. 6,248 7,776 8,279 664 799 432 289 575 611 -388 46 Commercial banks .............................. 4,015 6,060 4,520 253 136 24 109 383 395 -260 47 Retailers................................................ 2,101 1,440 2,683 289 445 293 130 26 168 -142 48 Gasoline companies............................ 132 276 1,076 122 218 115 50 166 48 14 49 Mobile home............................................ 565 897 1,366 150 103 108 120 198 128 36 50 Commercial banks .............................. 387 426 437 105 33 -22 68 57 17 -30 51 Finance companies.............................. -189 74 238 27 19 84 48 32 57 41 52 Savings and ioans................................ 297 310 668 21 52 51 10 115 57 33 53 Credit unions........................................ 70 87 23 -3 -1 -5 -6 -6 -3 -8 54 Other ........................................................ 13,261 16,580 13,292 885 972 127 -9 641 303 -988 55 Commercial banks .............................. 4,287 6,340 3,792 210 190 94 173 321 17 -612 56 Finance companies.............................. 3,750 4,654 6,968 686 688 230 25 308 228 -120 57 Credit unions........................................ 3,505 4,379 1,149 -70 -19 -237 -184 -190 -130 -362 58 Retailers................................................ 553 -54 357 46 32 -11 -10 27 75 77 59 Savings and loans................................ 814 731 1,299 55 91 114 -3 191 147 50 60 Mutual savings banks.......................... 352 530 -273 -42 -10 -63 -10 -16 -34 -21 l.The Board’s series cover most short- and intermediate-term credit extended Note. Total consumer noninstallment credit outstanding—credit scheduled to to individuals through regular business channels, usually to finance the purchase be repaid in a lump sum, including single-payment loans, charge accounts, and of consumer goods and services or to refinance debts incurred for such purposes, service credit—amounted to $70.9 billion at the end of 1979, $64.7 billion at the and scheduled to be repaid (or with the option of repayment) in two or more end of 1978, $58.6 billion at the end of 1977, and $55.4 billion at the end of 1976. installments. 2.Includes auto dealers and excludes 30-day charge credit held by travel and entertainment companies. 3.Net change equals extensions minus liquidations (repayments, charge-offs, and other credit); figures for all months are seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Consumer Debt A43 1.58 CONSUMER INSTALLMENT CREDIT Extensions and Liquidations Millions of dollars; monthly data are seasonally adjusted. 1979 1980 Holder, and type of credit 1977 1978 1979 Oct. Nov. Dec. Jan. Feb. Mar. Apr. Extensions 1 Total .......................................................................... 254,071 298,351 322,558 27,695 26,464 25,671 26,702 27,076 26,620 22,548 By major holder 2 Commercial banks ....................................................... 117,896 142,720 149,599 12,718 11,738 11,370 12,126 12,004 11,315 9,338 3 Finance companies....................................................... 41,989 50,505 61,518 5,642 5,105 5,249 5,540 5,639 5,700 4,841 4 Credit unions ............................................................... 34,028 40,023 36,778 2,942 2,808 2,396 2,527 2,495 2,501 1,865 5 Retailers1 ....................................................................... 39,133 41,619 46,092 3,930 4,161 4,054 4,010 4,042 4,358 3,870 6 Savings and loans......................................................... 4,485 5,050 7,333 571 606 632 485 775 665 555 7 Gasoline companies..................................................... 14,617 16,125 19,607 1,773 1,913 1,895 1,889 2,004 1,987 1,978 8 Mutual savings banks ................................................. 1,923 2,309 1,631 119 133 75 125 117 94 101 By major type of credit 9 Automobile ................................................................... 75,641 88,987 91,847 7,676 7,066 7,131 7,780 7,659 7,240 5,725 10 Commercial banks ................................................... 46,363 53,028 50,596 4,185 3,640 3,808 4,026 3,936 3,394 2,398 11 Indirect paper....................................................... 25,149 29,336 28,183 2,376 2,009 2,181 2,154 2,096 1,978 1,433 12 Direct loans........................................................... 21,214 23,692 22,413 1,809 1,631 1,627 1,872 1,840 1,416 965 13 Credit unions ........................................................... 16,616 19,486 18,301 1,434 1,399 1,223 1,348 1,338 1,306 962 14 Finance companies................................................... 12,662 16,473 22,950 2,057 2,027 2,100 2,406 2,385 2,540 2,365 15 Revolving ..................................................................... 86,756 104,587 120,728 10,424 10,613 10,196 10,475 10,458 11,038 10,293 16 Commercial banks ................................................... 38,256 51,531 60,406 5,165 5,014 4,683 5,030 4,920 5,200 4,929 17 Retailers ................................................................... 33,883 36,931 40,715 3,486 3,686 3,618 3,556 3,534 3,851 3,386 18 Gasoline companies................................................. 14,617 16,125 19,607 1,773 1,913 1,895 1,889 2,004 1,987 1,978 19 Mobile home................................................................. 5,425 6,067 6,395 582 515 490 558 597 506 436 20 Commercial banks ................................................... 3,466 3,704 3,720 374 294 245 351 304 263 220 21 Finance companies................................................... 643 886 797 83 69 97 87 80 90 84 22 Savings and loans..................................................... 1,120 1,239 1,687 114 139 140 112 207 143 128 23 Credit unions ........................................................... 196 238 191 11 13 8 8 6 10 4 24 Other ............................................................................. 86,249 98,710 103,588 9,013 8,270 7,854 7,889 8,362 7,836 6,094 25 Commercial banks ................................................... 29,811 34,457 34,877 2,994 2,790 2,634 2,719 2,844 2,458 1,791 26 Finance companies................................................... 28,684 33,146 37,771 3,502 3,009 3,052 3,047 3,174 3,070 2,392 27 Credit unions ........................................................... 17,216 20,299 18,286 1,497 1,396 1,165 1,171 1,151 1,185 899 28 Retailers ................................................................... 5,250 4,688 5,377 444 475 436 454 508 507 484 29 Savings and loans..................................................... 3,365 3,811 5,646 457 467 492 373 568 522 427 30 Mutual savings banks ............................................ 1,923 2,309 1,631 119 133 75 125 117 94 101 Liquidations 31 Total .......................................................................... 218,793 253,541 287,067 25,509 24,057 24,322 25,330 24,781 25,183 24,533 By major holder 32 Commercial banks ....................................................... 99,251 118,907 136,185 11,947 11,455 11,152 11,693 11,221 11,298 11,575 33 Finance companies....................................................... 36,041 41,075 47,498 4,566 3,765 4,162 4,444 4,263 4,526 3,857 34 Credit unions ............................................................... 27,592 31,689 34,531 3,094 2,852 2,851 2,851 2,868 2,716 2,608 35 Retailers1 ....................................................................... 36,479 40,233 43,052 3,595 3,684 3,772 3,890 3,989 4,115 3,935 36 Savings and loans......................................................... 3,374 4,009 5,366 495 463 467 478 469 461 472 37 Gasoline companies..................................................... 14,485 15,849 18,531 1,651 1,695 1,780 1,839 1,838 1,939 1,964 38 Mutual savings banks ................................................. 1,571 1,779 1,904 161 143 138 135 133 128 122 By major type of credit 39 Automobile ................................................................... 60,437 69,430 79,293 7,189 6,533 6,449 6,808 6,778 6,845 6,370 40 Commercial banks ................................................... 36,407 42,041 45,931 3,982 3,716 3,686 3,943 3,914 3,806 3,733 41 Indirect paper....................................................... 19,842 22,865 24,824 2,139 1,969 1,921 2,082 2,048 2,064 2,131 42 Direct loans........................................................... 16,565 19,176 21,107 1,843 1,747 1,765 1,861 1,866 1,742 1,602 43 Credit unions ........................................................... 13,755 15,618 17,226 1,513 1,423 1,436 1,482 1,515 1,388 1,335 44 Finance companies................................................... 10,275 11,771 16,136 1,694 1,394 1,327 1,383 1,349 1,651 1,302 45 Revolving ..................................................................... 80,508 96,811 112,449 9,760 9,814 9,764 10,186 9,883 10,427 10,681 46 Commercial banks ................................................... 34,241 45,471 55,886 4,912 4,878 4,659 4,921 4,537 4,805 5,189 47 Retailers ................................................................... 31,782 35,491 38,032 3,197 3,241 3,325 3,426 3,508 3,683 3,528 48 Gasoline companies................................................. 14,485 15,849 18,531 1,651 1,695 1,780 1,839 1,838 1,939 1,964 49 Mobile home................................................................. 4,860 5,170 5,029 432 412 382 438 399 378 400 50 Commercial banks ................................................... 3,079 3,278 3,283 269 261 267 283 247 246 250 51 Finance companies................................................... 832 812 559 56 50 13 39 48 33 43 52 Savings and loans..................................................... 823 929 1,019 93 87 89 102 92 86 95 53 Credit unions ........................................................... 126 151 168 14 14 13 14 12 13 12 54 Other ............................................................................. 72,988 82,130 90,296 8,128 7,298 7,727 7,898 7,721 7,533 7,082 55 Commercial banks ................................................... 25,524 28,117 31,085 2,784 2,600 2,540 2,546 2,523 2,441 2,403 56 Finance companies................................................... 24,934 28,492 30,803 2,816 2,321 2,822 3,022 2,866 2,842 2,512 57 Credit unions ........................................................... 13,711 15,920 17,137 1,567 1,415 1,402 1,355 1,341 1,315 1,261 58 Retailers ................................................................... 4,697 4,742 5,020 398 443 447 464 481 432 407 59 Savings and loans..................................................... 2,551 3,080 4,347 402 376 378 376 377 375 377 60 Mutual savings banks ............................................ 1,571 1,779 1,904 161 143 138 135 133 128 122 1.Includes auto dealers and excludes 30-day charge credit held by travel and entertainment companies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A44 Domestic Financial Statistics □ June 1980 1.59 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1977 1978 1979 Transaction category, sector 1974 1975 1976 1977 1978 1979 HI H2 HI H2 HI H2 Nonfinancial sectors 1 Total funds raised......................................................... 191.3 210.8 271.9 338.5 400.3 395.2 298.1 378.9 384.5 416.1 383.2 408.5 2 Excluding equities ....................................................... 187.4 200.7 261.1 335.4 398.2 390.9 296.9 373.8 387.1 409.3 380.5 402.5 By sector and instrument 3U.S. government ......................................................... 11.8 85.4 69.0 56.8 53.7 37.4 46.1 67.4 61.4 46.0 27.3 47.4 4 Treasury securities................................................... 12.0 85.8 69.1 57.6 55.1 38.8 46.7 68.6 62.3 47.9 29.6 47.9 5 Agency issues and mortgages................................ -.2 -.4 -.1 -.9 -1.4 -1.4 - .6 -1.2 -.9 -1.9 -2.3 -.5 6 All other nonfinancial sectors .................................. 179.5 125.4 202.9 281.8 346.6 357.9 252.0 311.5 323.1 370.2 355.9 361.2 7 Corporate equities ................................................... 3.8 10.1 10.8 3.1 2.1 4.4 1.2 5.1 -2.6 6.8 2.7 6.0 8 Debt instruments ..................................................... 175.6 115.3 192.0 278.6 344.5 353.5 250.8 306.4 325.7 363.4 353.2 355.2 9 Private domestic nonfinancial sectors.................. 164.1 112.1 182.0 267.9 314.4 335.9 241.5 294.2 302.5 326.3 340.2 333.1 10 Corporate equities ............................................... 4.1 9.9 10.5 2.7 2.6 3.5 .5 4.9 -1.8 7.0 2.8 4.1 11 Debt instruments ................................................. 160.0 102.1 171.5 265.1 311.8 332.4 241.0 289.3 304.3 319.2 337.4 329.0 12 Debt capital instruments................................ 98.0 98.4 123.5 175.6 196.6 201.9 158.7 192.5 188.0 205.1 202.6 201.5 13 State and local obligations........................ 16.5 16.1 15.7 23.7 28.3 21.4 22.3 25.0 27.8 28.7 17.4 25.3 14 Corporate bonds.......................................... 19.7 27.2 22.8 21.0 20.1 21.2 16.6 25.4 20.6 19.6 23.2 19.4 15 Home ......................................................... 34.8 39.5 63.7 96.4 104.5 110.2 89.7 103.1 99.8 109.2 111.0 109.4 16 Multifamily residential .......................... 6.9 * 1.8 7.4 10.2 8.9 6.4 8.4 9.3 11.2 8.1 9.8 17 Commercial ............................................... 15.1 11.0 13.4 18.4 23.3 25.2 14.8 21.9 21.2 25.4 25.7 24.7 18 Farm ........................................................... 5.0 4.6 6.1 8.8 10.2 15.0 9.0 8.7 9.3 11.1 17.1 13.0 19 Other debt instruments.................................. 62.0 3.8 48.0 89.5 115.2 130.5 82.3 96.7 116.3 114.1 134.8 127.4 20 Consumer credit........................................... 9.9 9.7 25.6 40.6 50.6 42.3 36.6 44.5 50.1 51.0 47.3 37.2 21 Bank loans n.e.c............................................ 31.7 -12.3 4.0 27.0 37.3 50.0 27.3 26.7 43.1 31.4 47.7 53.5 22 Open market paper.................................... 6.6 -2.6 4.0 2.9 5.2 10.9 3.4 2.4 5.3 5.1 10.8 10.9 23 Other ............................................................. 13.7 9.0 14.4 19.0 22.2 27.3 14.9 23.2 17.8 26.5 29.0 25.8 24 By borrowing sector ........................................... 164.1 112.1 182.0 267.9 314.4 335.9 241.5 294.2 302.5 326.3 340.2 333.1 25 State and local governments.......................... 15.5 13.7 15.2 20.4 23.6 18.0 15.7 25.0 21.0 26.1 14.4 21.6 26 Households ....................................................... 51.2 49.5 90.7 139.9 162.6 164.2 129.4 150.4 156.1 169.1 167.7 160.5 27 Farm ................................................................... 8.0 8.8 10.9 14.7 18.1 24.6 15.7 13.8 15.3 20.8 23.4 25.8 28 Nonfarm noncorporate .................................. 7.7 2.0 5.4 12.5 15.4 15.5 13.4 12.5 16.3 14.5 15.0 16.1 29 Corporate ......................................................... 81.7 38.1 59.8 80.3 94.7 113.6 67.3 92.4 93.7 95.8 119.6 109.2 30 Foreign....................................................................... 15.4 13.3 20.8 13.9 32.3 22.0 10.5 17.3 20.6 43.9 15.7 28.1 31 Corporate equities ............................................... -.2 .2 .3 .4 -.5 .9 .6 .2 -.8 -.2 -.1 1.9 32 Debt instruments ................................................. 15.7 13.2 20.5 13.5 32.8 21.1 9.9 17.1 21.4 44.1 15.8 26.2 33 Bonds ................................................................. 2.1 6.2 8.6 5.1 4.0 4.1 4.4 5.7 5.0 3.0 3.5 4.7 34 Bank loans n.e.c................................................ 4.7 3.9 6.8 3.1 18.3 2.9 -.4 6.5 9.3 27.3 3.1 2.3 35 Open market paper........................................ 7.3 .3 1.9 2.4 6.6 11.2 2.7 2.2 3.6 9.6 6.1 16.3 36 U.S. government loans .................................. 1.6 2.8 3.3 3.0 3.9 3.0 3.1 2.9 3.6 4.2 3.1 2.8 Financial sectors 37Total funds raised......................................................... 39.2 12.7 24.1 54.0 81.4 86.2 47.7 60.3 80.7 82.1 87.9 84.5 By instrument 38 U.S. government related ........................................... 23.1 13.5 18.6 26.3 41.4 52.4 22.6 29.9 38.5 44.3 45.9 58.9 39 Sponsored credit agency securities...................... 16.6 2.3 3.3 7.0 23.1 24.3 7.1 6.8 21.9 24.3 21.7 26.8 40 Mortgage pool securities ......................................... 5.8 10.3 15.7 20.5 18.3 28.1 17.9 23.1 16.6 20.1 24.2 32.0 41 Loans from U.S. government .............................. .7 .9 -.4 -1.2 0 0 -2.3 0 0 0 0 0 42 Private financial sectors ............................................. 16.2 -.8 5.5 27.7 40.0 33.8 25.1 30.4 42.2 37.8 41.9 25.7 43 Corporate equities ................................................... .3 .6 1.0 .9 1.7 .9 .9 .8 2.2 1.1 2.7 -1.0 44 Debt instruments ..................................................... 15.9 -1.4 4.4 26.9 38.3 32.9 24.2 29.6 40.0 36.7 39.2 26.7 45 Corporate bonds................................................... 2.1 2.9 5.8 10.1 7.5 6.9 10.2 10.1 8.5 6.4 8.9 5.0 46 Mortgages ............................................................. -1.3 2.3 2.1 3.1 .9 -1.2 3.1 3.0 2.1 -.3 -.4 -1.9 47 Bank loans n.e.c.................................................... 4.6 -3.7 -3.7 -.3 2.8 -.4 -1.8 1.2 2.5 3.1 -1.4 .5 48 Open market paper and repurchase 3.8 1.1 2.2 9.6 14.6 18.4 9.8 9.5 13.5 15.7 24.4 12.4 49 Loans from Federal Home Loan Banks.......... 6.7 -4.0 -2.0 4.3 12.5 9.2 2.9 5.8 13.2 11.8 7.7 10.6 By sector 50 Sponsored credit agencies........................................... 17.3 3.2 2.6 5.8 23.1 24.3 4.7 6.8 21.9 24.3 21.7 26.8 51 Mortgage pools............................................................. 5.8 10.3 15.7 20.5 18.3 28.1 17.9 23.1 16.6 20.1 24.2 32.0 52 Private financial sectors ............................................ 16.2 -.8 5.5 27.7 40.0 33.8 25.1 30.4 42.2 37.8 41.9 25.7 53 Commercial banks ................................................... 1.2 1.2 2.3 1.1 1.3 1.6 .8 1.5 1.5 1.1 1.3 1.8 54 Bank affiliates........................................................... 3.5 .3 -.8 1.3 6.7 4.5 1.3 1.2 5.8 7.6 6.2 2.9 55 Savings and loan associations................................ 4.8 -2.3 .1 9.9 14.3 9.8 8.3 11.5 16.4 12.2 9.9 9.7 56 Other insurance companies .................................. .9 1.0 .9 .9 1.1 1.0 .9 1.0 1.0 1.1 1.0 .9 57 Finance companies................................................... 6.0 .5 6.4 17.6 18.6 19.2 16.7 18.5 18.9 18.2 24.3 14.2 58 REITs ....................................................................... .6 -1.4 -2.4 -2.2 -1.0 -.2 -2.4 -2.0 -1.0 -1.0 -.5 .1 59 Open-end investment companies.......................... -.7 -.1 -1.0 -.9 -1.0 -2.1 -.6 -1.3 -.5 -1.5 -.3 -3.9 All sectors 60 Total funds raised, by instrument............................ 230.5 223.5 296.0 392.5 481.7 481.4 345.8 439.2 465.2 498.3 471.0 493.1 61 Investment company shares ....................................... -.7 -.1 -1.0 -.9 -1.0 -2.1 -.6 -1.3 -.5 -1.5 -.3 -.3.9 62 Other corporate equities............................................. 4.8 10.8 12.9 4.9 4.7 7.3 2.6 7.2 .1 9.4 5.7 8.9 63 Debt instruments ......................................................... 226.4 212.8 284.1 388.5 478.0 476.2 343.8 433.3 465.5 490.4 465.6 488.1 64 U.S. government securities .................................. 34.3 98.2 88.1 84.3 95.2 89.9 71.2 97.4 100.0 90.4 73.4 106.3 65 State and local obligations.................................... 16.5 16.1 15.7 23.7 28.3 21.4 22.3 25.0 27.8 28.7 17.4 25.3 66 Corporate and foreign bonds................................ 23.9 36.4 37.2 36.1 31.6 32.2 31.2 41.1 34.2 29.1 35.5 29.1 67 Mortgages ................................................................. 60.5 57.2 87.1 134.0 149.0 158.1 122.9 145.1 141.6 156.4 161.4 154.8 68 Consumer credit....................................................... 9.9 9.7 25.6 40.6 50.6 42.3 36.6 44.5 50.1 51.0 47.3 37.2 69 Bank loans n.e.c........................................................ 41.0 -12.2 7.0 29.8 58.4 52.5 25.1 34.4 54.9 61.8 49.5 56.3 70 Open market paper and RPs................................. 17.7 -1.2 8.1 15.0 26.4 40.5 15.9 14.0 22.4 30.4 41.3 39.7 71 Other loans ............................................................... 22.7 8.7 15.3 25.2 38.6 39.5 18.5 31.8 34.6 42.5 39.8 39.2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A45 1.60 DIRECT AND INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS Billions of dollars, except as noted; quarterly data are at seasonally adjusted annual rates 1977 1978 1979 Transaction category, or sector 1974 1975 1976 1977 1978 1979 HI H2 HI H2 HI H2 1 Total funds advanced in credit markets to nonfinancial sectors ........................................................................... 187.4 200.7 261.1 355.4 398.2 390.9 296.9 373.8 387.1 409.3 380.5 402.5 By public agencies and foreign 2 Total net advances............................................................... 53.7 44.6 54.3 85.1 109.7 80.3 66.1 104.2 102.8 116.6 43.6 117.6 3 U.S. government securities .......................................... 11.9 22.5 26.8 40.2 43.9 2.2 27.1 53.3 43.7 44.0 -27.5 32.1 4 Residential mortgages..................................................... 14.7 16.2 12.8 20.4 26.5 36.1 18.9 22.0 22.2 30.7 33.7 38.5 5 FHLB advances to savings and loans.......................... 6.7 -4.0 -2.0 4.3 12.5 9.2 2.9 5.8 13.2 11.8 7.7 10.6 6 Other loans and securities ............................................ 20.5 9.8 16.6 20.2 26.9 32.8 17.2 23.1 23.7 30.1 29.7 36.4 Total advanced, by sector 7 U.S. government ................................................................. 9.8 15.1 8.9 11.8 20.4 22.6 5.9 17.8 19.4 21.4 24.3 20.9 8 Sponsored credit agencies ................................................. 26.5 14.8 20.3 26.8 44.6 57.7 21.6 32.0 39.4 49.8 50.6 64.9 9 Monetary authorities ........................................................... 6.2 8.5 9.8 7.1 7.0 7.7 10.2 4.0 13.4 .5 -.8 16.4 10 Foreign ................................................................................. 11.2 6.1 15.2 39.4 37.7 -7.7 28.3 50.4 30.6 44.9 -30.4 15.4 11 Agency borrowing not included in line 1........................ 23.1 13.5 18.6 26.3 41.4 52.4 22.6 29.9 38.5 44.3 45.9 58.9 Private domestic funds advanced 12 Total net advances............................................................... 156.8 169.7 225.4 276.5 330.0 363.0 253.5 299.6 322.8 337.1 382.8 343.8 13 U.S. government securities .......................................... 22.4 75.7 61.3 44.1 51.3 87.6 44.1 44.1 56.3 46.4 100.9 74.2 14 State and local obligations............................................ 16.5 16.1 15.7 23.7 28.3 21.4 22.3 25.0 27.8 28.7 17.4 25.3 15 Corporate and foreign bonds......................................... 20.9 32.8 30.5 22.5 22.5 25.8 18.0 27.0 24.1 20.9 28.3 23.6 16 Residential mortgages..................................................... 26.9 23.2 52.7 83.3 88.2 82.9 77.1 89.4 86.7 89.6 85.3 80.5 17 Other mortgages and loans .......................................... 76.8 17.9 63.3 107.3 152.2 154.4 94.9 119.7 141.1 163.3 158.6 150.7 18 Less: Federal Home Loan Bank advances................ 6.7 -4.0 -2.0 4.3 12.5 9.2 2.9 5.8 13.2 11.8 7.7 10.6 Private financial intermediation 19 Credit market funds advanced by private financial institutions ..................................................................... 125.5 122.5 190.3 255.9 296.9 293.0 249.1 265.0 301.7 292.0 314.4 272.9 20 Commercial banking ....................................................... 66.6 29.4 59.6 87.6 128.7 121.1 84.6 90.7 132.5 125.0 128.7 115.0 21 Savings institutions ......................................................... 24.2 53.5 70.8 82.0 75.9 54.6 81.4 82.6 75.8 75.9 57.8 51.4 22 Insurance and pension funds........................................ 29.8 40.6 49.9 67.9 73.5 72.9 65.2 70.6 76.9 70.2 75.4 70.5 23 Other finance ................................................................... 4.8 -1.0 10.0 18.4 18.7 44.3 18.0 21.2 16.6 20.8 52.5 36.1 24 Source of funds ................................................................... 125.5 122.5 190.3 255.9 296.9 293.0 249.1 265.0 301.7 292.0 314.4 272.9 25 Private domestic deposits............................................... 67.5 92.0 124.6 141.2 142.5 135.5 138.6 143.8 138.3 146.7 118.4 152.0 26 Credit market borrowing ............................................... 15.9 -1.4 4.4 26.9 38.3 32.9 24.2 29.6 40.0 36.7 39.2 26.7 27 Other sources ................................................................... 42.1 32.0 61.3 87.8 116.0 124.5 86.2 91.7 123.5 108.6 156.8 94.3 28 Foreign funds ............................................................... 10.3 -8.7 -4.6 1.2 6.3 26.3 1.6 .8 5.7 6.9 53.2 -.6 29 Treasury balances ....................................................... -5.1 -1.7 -.1 4.3 6.8 .4 .1 8.5 1.9 11.6 5.5 -4.7 30 Insurance and pension reserves................................ 26.2 29.7 34.5 49.4 62.7 54.0 45.3 53.4 66.2 59.2 55.9 52.1 31 Other, net ..................................................................... 10.6 12.7 31.4 32.9 40.3 43.8 39.3 29.0 49.6 31.0 42.2 47.4 Private domestic nonfinancial investors 32 Direct lending in credit markets...................................... 47.2 45.8 39.5 47.5 71.4 102.9 28.6 64.1 61.1 81.7 107.6 97.5 33 U.S. government securities .......................................... 18.9 24.1 16.1 23.0 33.2 56.2 11.9 34.2 32.1 34.4 64.4 47.5 34 State and local obligations............................................. 9.3 8.4 3.8 2.6 4.5 -.5 5.7 7.0 2.0 -.1 35 Corporate and foreign bonds........................................ 5.1 8.4 5.8 -3.3 -1.4 9.3 -.1 -6.5 -3.7 1.0 8.2 10.6 36 Commercial paper ........................................................... 5.8 -1.3 1.9 9.5 16.3 10.7 8.2 10.8 8.2 24.4 10.4 10.6 37 Other ................................................................................. 8.0 6.2 11.8 15.7 18.7 26.7 9.2 19.9 17.5 20.0 24.6 28.9 38 Deposits and currency......................................................... 73.8 98.1 131.9 149.5 151.8 143.5 144.5 154.5 148.7 154.8 128.4 157.9 39 Security RPs ..................................................................... -2.2 .2 2.3 2.2 7.5 6.6 4.3 .2 9.8 5.1 18.5 -5.3 40 Money market fund shares............................................. 2.4 1.3 .2 6.9 34.4 -.5 .9 6.1 7.7 30.2 38.6 41 Time and savings accounts............................................ 65.4 84.0 113.5 121.0 115.2 83.3 115.3 126.7 110.7 119.8 73.7 92.6 42 Large negotiable certificates of deposit.................. 18.4 -14.3 -13.6 9.0 10.8 -.7 -4.5 22.6 10.1 11.4 -25.5 24.2 43 Other at commercial banks ...................................... 25.3 38.8 57.9 43.0 43.3 39.3 47.5 38.4 42.1 44.5 43.7 34.7 44 At savings institutions................................................. 21.8 59.4 69.1 69.0 61.1 44.7 72.3 65.7 58.5 63.8 55.5 33.7 45 Money ............................................................................... 8.2 12.6 16.1 26.1 22.2 19.1 25.4 26.8 22.1 22.3 6.0 32.0 46 Demand deposits ......................................................... 1.9 6.4 8.8 17.8 12.9 11.2 19.6 16.1 11.6 14.2 -4.0 26.1 47 Currency ....................................................................... 6.3 6.2 7.3 8.3 9.3 7.9 5.8 10.8 10.5 8.1 10.0 5.9 48 Total of credit market instruments, deposits and currency ......................................................................... 121.0 143.9 171.4 197.0 223.2 246.4 173.1 218.6 209.8 236.6 236.0 255.4 49 Public support rate (in percent) .................................. 28.7 22.2 20.8 25.4 27.5 20.5 22.2 27.9 26.5 28.5 11.5 29.2 50 Private financial intermediation (in percent) ............ 80.0 72.2 84.4 92.5 90.0 80.7 98.2 88.5 93.5 86.6 82.1 79.4 51 Total foreign funds ......................................................... 21.5 -2.6 10.6 40.5 44.0 18.7 29.9 51.2 36.3 51.8 22.8 14.9 Memo: Corporate equities not included above 52 Total net issues..................................................................... 4.1 10.7 11.9 4.0 3.7 5.2 2.1 5.9 -.4 7.9 5.4 5.0 53 Mutual fund shares ......................................................... -.7 -.1 -1.0 -.9 -1.0 .-2.1 -.6 -1.3 -.5 -1.5 -.3 -3.9 54 Other equities................................................................... 4.8 10.8 12.9 4.9 4.7 7.3 2.6 7.2 .1 9.4 5.7 8.9 55 Acquisitions by financial institutions .............................. 5.8 9.6 12.3 7.4 7.6 16.6 6.8 8.1 .4 14.7 14.5 18.7 56 Other net purchases ........................................................... -1.7 1.1 -.4 -3.4 -3.8 -11.4 -4.7 -2.2 -.8 -6.8 -9.1 -13.6 Notes by line number. 30. Excludes net investment of these reserves in corporate equities. 1. Line 2 of p. A-44. 31. Mainly retained earnings and net miscellaneous liabilities. 2. Sum of lines 3-6 or 7-10. 32. Line 12 less line 19 plus line 26. 6. Includes farm and commercial mortgages. 33-37. Lines 13-17 less amounts acquired by private finance. Line 37 includes 11. Credit market funds raised by federally sponsored credit agencies, and net mortgages. issues of federally related mortgage pool securities. Included below in lines 45. Mainly an offset to line 9. 3, 13, 33. 46. Lines 32 plus 38, or line 12 less line 27 plus 45. 12. Line 1 less line 2 plus line 11. Also line 19 less line 26 plus line 32. Also sum 47. Line 2/line 1. of lines 27, 32, 39, and 44. 48. Line 19/line 12. 17. Includes farm and commercial mortgages. 49. Sum of lines 10 and 28. 25. Sum of lines 39 and 44. 50. 52. Includes issues by financial institutions. 26. Excludes equity issues and investment company shares. Includes line 18. Note. Full statements for sectors and transaction types quarterly, and annually 28. Foreign deposits at commercial banks, bank borrowings from foreign branches, for flows and for amounts outstanding, may be obtained from Flow of Funds and liabilities of foreign banking agencies to foreign affiliates. Section, Division of Research and Statistics, Board of Governors of the Federal 29. Demand deposits at commercial banks. Reserve System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics □ June 1980 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures 1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted. 1979 1980 Measure 1977 1978 1979 Oct. Nov. Dec. Jan. Feb.'" Mar.r Apr/ May 1 Industrial production1........................................................... 138.2 146.1 152.2 152.2 152.1 152.2 152.6 152.3 151.6 148.6 145.5 Market groupings 2 Products, total ....................................................................... 137.9 144.8 149.7 149.6 149.4 149.7 150.0 149.9 149.4 146.8 144.2 3 Final, total ......................................................................... 135.9 142.2 147.0 146.8 146.6 147.0 147.0 147.4 147.1 145.2 143.0 4 Consumer goods ........................................................... 145.3 149.1 150.5 149.7 148.9 148.5 148.2 148.5 147.9 145.2 142.7 5 Equipment ..................................................................... 123.0 132.8 142.2 142.9 143.6 145.0 145.4 146.0 146.0 145.1 143.4 6 Intermediate ....................................................................... 145.1 154.1 160.0 159.8 159.8 159.9 160.8 159.3 157.9 152.8 148.6 7 Materials ................................................................................. 138.6 148.3 156.0 156.3 156.4 156.2 156.7 155.9 155.1 151.5 147.6 Industry groupings 8 Manufacturing ....................................................................... 138.4 146.8 153.2 153.2 153.0 152.8 153.4 152.7 151.8 148.3 145.0 Capacity utilization (percent)1-2 9 Manufacturing ....................................................................... 81.9 84.4 85.7 84.9 84.6 84.3 84.4 83.8 83.1 80.9 78.9 10 Industrial materials industries............................................ 82.7 85.6 87.2 86.6 86.4 87.2 86.0 85.4 84.7 82.5 80.2 11 Construction contracts3 ....................................................... 160.5 174.3 171.0 156.0 183.0 190.0 171.0 130.0 130.0 n.a. 12 Nonagricultural employment, total4.................................. 125.3 131.4 136.0 136.8 136.9 137.2 137.8 138.1 138.2 131.6 137.3 13 Goods-producing, total..................................................... 104.5 109.8 114.0 114.0 113.8 114.4 114.9 114.7 114.1 112.4 111.4 14 Manufacturing, total ..................................................... 101.2 105.3 107.9 107.5 107.1 107.4 107.4 107.4 107.4 105.9 104.5 15 Manufacturing, production-worker............................ 98.8 102.8 104.9 104.1 103.6 103.9 103.8 107.4 103.5 101.5 99.4 16 Service-producing ............................................................. 136.7 143.2 148.1 149.3 149.6 149.7 150.3 150.9 151.5 151.3 151.5 17 Personal income, total5 ....................................................... 244.4 274.1 306.9 316.2 320.1 323.7 326.6 328.1 330.4 329.9 n.a. 18 Wages and salary disbursements .................................. 230.2 258.1 287.1 291.9 294.1 297.4 302.5'- 305.1 307.4 1 305.8 n.a. 19 Manufacturing ............................................................... 198.3 222.4 246.8 250.6 251.7 254.7 256.7'- 259.2 260.8 257.8 n.a. 20 Disposable personal income ............................................... 194.8 217.7 242.5'" 251.3 259.2 21 Retail sales6 ........................................................................... 229.8 253.8 280.9 288.8' 292.0 294.8 303.6 301.8 292.4 276.2 273.6 Prices1 22 Consumer ............................................................................... 181.5 195.4 217.4 225.4 227.5 229.9 233.2 236.4 239.8 242.5 n.a. 23 Producer finished goods....................................................... 180.6 194.6 224.2 226.3 228.1 232.4'- 235.4 238.2 240.0 241.0 1. The industrial production and capacity utilization series have been revised. 6. Based on Bureau of Census data published in Survey of Current Business For a description of the changes see the August 1979 Bulletin, pp. 603-07. (U.S. Department of Commerce). 2. Ratios of indexes of production to indexes of capacity. Based on data from 7. Data without seasonal adjustment, as published in Monthly Labor Review Federal Reserve, McGraw-Hill Economics Department, and Department of Com­ (U.S. Department of Labor). Seasonally adjusted data for changes in the price merce. indexes may be obtained from the Bureau of Labor Statistics, U.S. Department 3. Index of dollar value of total construction contracts, including residential, of Labor. nonresidential, and heavy engineering, from McGraw-Hill Information Systems Company, F. W. Dodge Division. Note: Basic data (not index numbers) for series mentioned in notes 4, 5, and 4. Based on data in Employment and Earnings (U.S. Department of Labor). 6, and indexes for series mentioned in notes 3 and 7 may also be found in the Series covers employees only, excluding personnel in the Armed Forces. Survey of Current Business (U.S. Department of Commerce). 5. Based on data in Survey of Current Business (U.S. Department of Commerce). Figures for industrial production for the last two months are preliminary and Series for disposable income is quarterly. estimated, respectively. 2.11 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION Seasonally adjusted 1979 1980 1979 1980 1979 1980 Series Q2 Q3 Q4 Ql' 02 Q3 Q4 Ql Q2 Q3 Q4 Ql' Output (167 = 100) Capacity (percent of 1967 output) Utilization rate (percent) 1 Manufacturing ................................................. 153.1 152.9 153.0 152.6 178.2 179.5 180.8 182.3 85.9 84.6 84.6 83.7 2 Primary processing.............................................. 161.9 161.8 161.8 160.1 184.2 185.7 187.2 188.7 87.9 86.5 86.4 84.8 3 Advanced processing .......................................... 148.5 148.1 148.2 148.7 175.0 176.2 177.4 178.8 84.8 83.5 83.6 83.1 4 Materials ........................................................... 155.6 156.3 156.3 155.9 178.1 179.5 181.0 182.5 87.3 86.3 86.3 85.4 5 Durable goods .................................................... 157.7 156.1 156.3 155.2 183.0 184.5 186.0 187.7 86.2 83.9 84.0 82.7 6 Metal materials................................................. 124.3 119.5 119.5 117.1 140.3 140.7 141.1 141.5 88.5 84.7 84.7 82.8 7 Nondurable goods .............................................. 173.4 178.2 178.3 178.5 193.5 195.3 197.3 199.1 89.6 90.3 90.4 89.6 8 Textile, paper, and chemical ........................ 181.3 187.0 186.9 186.1 201.3 203.2 205.3 207.3 90.0 91.1 91.0 89.8 9 Textile .......................................................... 119.6 123.7 123.7 121.6 137.3 137.7 138.1 138.5 87.1 89.6 89.6 87.8 10 Paper ............................................................ 140.7 148.4 148.4 142.5 149.6 150.6 151.6 152.9 94.0 97.9 97.9 93.2 11 Chemical ...................................................... 224.8 230.4 230.2 232.0 250.3 253.3 256.3 259.4 89.8 89.8 89.8 89.4 12 Energy .................................................................. 128.1 129.9 129.1 129.6 147.5 148.3 149.2 149.8 86.9 86.8 86.6 86.5 1. The capacity utilization series has been revised. For a description of the changes, see the August 1979 Bulletin, pp. 606-07. 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. 1979 1980 Category 1977 1978 1979 Nov. Dec. Jan. Feb. Mar. Apr.' May Household Survey Data 1 Noninstitutional population1 ...................... 158,559 161,058 163,620 164,682 164,898 165,101 165,298 165,506 165,693 165,886 2 Labor force (including Armed Forces)1 .. 99,534 102,537 104,996 105,744 106,088 106,310 106,346 106,184 106,511 107,230 3 Civilian labor force ................................ 97,401 100,420 102,908 103,652 103,999 104,229 104,260 104,094 104,419 105,142 Employment 4 Nonagricultural industries2 ................ 87,302 91,031 93,648 94,223 94,553 94,534 94,626 94,298 93,912 93,609 5 Agriculture ........................................... 3,244 3,342 3,297 3,385 3,359 3,270 3,326 3,358 3,242 3,379 Unemployment 6 Number ................................................. 6,855 6,047 5,963 6,044 6,087 6,425 6,307 6,438 7,265 8,154 7 Rate (percent of civilian labor force) 7.0 6.0 5.8 5.8 5.9 6.2 6.0 6.2 7.0 7.8 8 Not in labor force........................................ 59,025 58,521 58,623 59,937 58,810 58,791 58,951 59,322 59,182 58,657 Establishment Survey Data 9 Nonagricultural payroll employment3 ----- 82,423 86,446 89,497 90,100 90,241 90,652 90,845" 90,819' 90,508 90,328 10 Manufacturing............................................... 19,682 20.476 20,979 20,836 20,881 20,890 20,892' 20,889' 20,603 20,328 11 Mining ........................................................... 813 851 958 983 991 1,000 1,009' 1,011' 1,016 1,034 12 Contract construction ................................ 3,851 4,271 4,642 4,714 4,783 4,893 4,831' 4,700' 4,591 4,601 13 Transportation and public utilities .......... 4,713 4,927 5,154 5,229 5,223 5,212 5,210' 5,213' 5,189 5,187 14 Trade ............................................................. 18,516 19,499 20,140 20,308 20,254 20,428 20,521' 20,499' 20,349 20,371 15 Finance........................................................... 4,467 4,727 4,964 5,039 5,056 5,081 5,092' 5,107' 5,107 5,131 16 Service ........................................................... 15,303 16,220 17,047 17,298 17,357 17,442 17,522' 17,548' 17,578 17,650 17 Government ................................................. 15,079 15.476 15,613 15,693 15,696 15,706 15,768' 15,852' 16,075 16,026 1. Persons 16 years of age and over. Monthly figures, which are based on sample 3. Data include all full- and part-time employees who worked during, or data, relate to the calendar week that contains the 12th day; annual data are received pay for, the pay period that includes the 12th day of the month, and averages of monthly figures. By definition, seasonality does not exist in population exclude proprietors, self-employed persons, domestic servants, unpaid family figures. Based on data from Employment and Earnings (U.S. Department of La­ workers, and members of the Armed Forces. Data are adjusted to the February bor). 1977 benchmark. Based on data from Employment and Earnings (U.S. Department 2. Includes self-employed, unpaid family, and domestic service workers. of Labor). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 Domestic Nonfinancial Statistics □ June 1980 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value' Monthly data are seasonally adjusted. 1967 1979 1979 1980 Grouping pro­ p ti o o r n ­ age May July Aug. Sept. Oct. Nov. Dec. Jan. Feb/ Mar. Apr./7 May* Index (1967 = 100) Major Market 1 Total index..................................................... 100.00 152.2 152.4 152.8 151.6 152.4 152.2 152.1 152.2 152.6 152.3 151.6 148.6 145.5 2 Products ......................................................... 60.71 149.7 150.3 149.7 148.7 149.9 149.6 149.4 149.7 150.0 149.9 149.4 146.8 144.2 3 Final products ........................................... 47.82 147.0 147.8 147.1 145.6 147.2 146.8 146.6 147.0 147.0 147.4 147.1 145.2 143.0 27.68 150.5 152.0 150.8 148.2 149.7 149.7 148.9 148.5 148.2 148.5 147.9 145.2 142.7 5 Equipment ............................................. 20.14 142.2 141.9 142.1 141.8 143.9 142.9 143.6 145.0 145.4 146.0 146.0 145.1 143.4 6 Intermediate products ............................ 12.89 160.0 159.5 159.4 160.6 159.8 159.8 159.8 159.9 160.8 159.3 157.9 152.8 148.6 7 Materials ....................................................... 39.29 156.0 155.7 157.6 156.0 156.3 156.3 156.4 156.2 156.7 155.9 155.1 151.5 147.6 Consumer goods 8 Durable consumer goods .......................... 7.89 155.5 160.5 157.2 147.5 151.8 152.6 149.2 146.6 142.4 144.5 144.1 137.0 130.3 9 Automotive products.............................. 2.83 167.7 182.7 170.3 147.3 157.6 159.2 150.6 141.8 131.3 142.1 141.0 126.4 119.7 10 Autos and utility vehicles.................. 2.03 154.3 176.3 155.6 125.1 139.7 142.4 131.0 121.4 108.7 124.6 122.0 102.3 93.0 11 Autos ................................................. 1.90 136.7 153.1 141.8 118.5 128.0 129.0 118.3 110.2 98.0 116.8 114.9 97.1 88.4 12 Auto parts and allied goods.............. 80 201.6 199.0 207.8 203.7 203.0 202.1 200.3 193.6 188.5 186.7 189.1 187.4 187.6 5.06 148.7 148.1 149.8 147.7 148.5 148.8 148.4 149.3 148.6 145.8 145.8 143.0 136.2 14 Appliances, A/C, and TV.................. 1.40 127.5 128.4 129.7 121.2 129.6 128.0 129.7 134.2 128.9 122.4 122.1 115.4 109.2 15 Appliances and TV ........................ 1.33 129.3 130.2 131.6 124.1 132.2 130.2 132.4 136.5 130.0 124.4 125.0 117.5 16 Carpeting and furniture...................... 1.07 170.6 170.2 171.9 171.7 169.7 169.2 169.1 168.8 171.2 168.6 169.5 168.3 17 Miscellaneous home goods................ 2.59 151.1 149.6 151.6 152.1 150.0 151.7 150.0 149.4 149.9 149.1 149.0 147.5 141.0 18 Nondurable consumer goods .................... 19.79 148.5 148.7 148.2 148.5 148.9 148.6 148.7 149.2 150.5 150.1 149.5 148.5 147.7 19 Clothing ..................................................... 4.29 129.1 128.6 126.9 128.0 129.0 127.7 129.1 129.1 128.3 126.8 125.0 20 Consumer staples ..................................... 15.50 153.8 154.2 154.1 154.2 154.3 154.3 154.2 154.8 156.7 156.5 156.2 155.4 155.0 21 Consumer foods and tobacco............ 8.33 145.4 145.7 147.0 145.3 146.5 146.7 145.9 146.8 148.4 148.3 148.2 148.1 22 Nonfood staples .................................. 7.17 163.6 164.1 162.4 164.6 163.5 163.2 163.8 164.2 166.4 166.1 165.5 163.8 162.8 23 Consumer chemical products........ 2.63 205.5 205.2 206.1 209.2 207.2 206.4 207.9 207.8 210.5 210.7 210.8 208.6 24 Consumer paper products.............. 1.92 120.8 121.3 119.9 121.2 121.1 121.6 119.3 121.0 123.7 122.3 121.4 120.2 25 Consumer energy products............ 2.62 153.0 154.3 149.8 151.6 150.8 150.5 152.2 152.2 153.4 153.3 152.5 150.9 26 Residential utilities...................... 1.45 165.2 167.8 158.5 163.5 162.2 164.2 166.7 166.3 164.6 165.9 Equipment 27 Business ......................................................... 12.63 171.3 171.4 171.4 171.5 173.6 172.0 172.5 174.1 175.0 175.8 175.8 174.2 172.1 28 Industrial ................................................... 6.77 152.1 151.8 151.3 151.7 153.5 151.2 153.3 153.1 157.4 158.8 159.1 158.6 157.7 29 Building and mining............................ 1.44 206.1 203.7 207.4 210.6 212.0 200.6 204.4 204.4 222.9 230.2 236.1 236.0 236.9 30 Manufacturing...................................... 3.85 130.3 136.1 130.3 131.1 130.4 130.8 132.5 132.1 132.6 132.8 132.3 131.5 130.8 31 Power .................................................... 1.47 156.3 157.7 151.0 147.7 156.3 156.3 157.6 157.8 158.1 156.7 153.7 153.4 150.6 32 Commercial transit, farm ...................... 5.86 193.4 193.9 194.6 194.4 196.8 195.9 194.6 198.4 195.3 195.4 195.0 192.3 188.7 33 Commercial ........................................... 3.26 227.8 224.9 227.0 230.5 231.4 234.2 232.2 236.9 237.8 237.7 239.1 236.4 233.8 34 Transit ................................................... 1.93 152.2 156.7 155.2 149.4 156.3 154.9 150.3 153.3 143.8 146.6 143.3 143.4 138.5 35 Farm ....................................................... 67 144.9 150.8 151.0 148.3 145.3 128.0 139.5 141.0 137.1 129.9 129.6 118.3 36 Defense and space ...................................... 7.51 93.2 92.5 92.8 92.0 94.0 94.0 95.0 95.9 95.8 96.0 95.9 96.1 95.1 Intermediate products 37 Construction supplies.................................. 6.42 156.9 156.4 156.4 157.3 156.3 156.8 156.7 156.0 156.4 154.3 153.0 146.0 139.8 38 Business supplies ........................................ 6.47 163.1 162.5 162.4 163.8 163.2 162.7 162.9 163.8 165.0 164.2 162.8 159.5 39 Commercial energy products ................ 1.14 172.3 172.6 167.8 170.7 169.8 172.2 174.4 175.7 172.3 169.0 170.7 171.2 Materials 40 Durable goods materials............................ 20.35 157.8 157.9 160.7 157.7 157.6 157.2 156.0 155.6 156.3 154.9 154.4 148.9 143.6 41 Durable consumer parts ........................ 4.58 137.1 142.5 138.5 129.7 132.2 132.0 126.8 123.8 122.2 120.9 121.1 111.7 104.0 42 Equipment parts...................................... 5.44 189.9 . 188.0 192.1 190.7 192.0 192.7 195.1 196.6 199.8 199.3 199.9 196.6 194.4 43 Durable materials n.e.c............................ 10.34 150.0 149.0 154.0 152.7 150.7 149.6 148.3 148.0 148.6 146.6 145.2 140.2 134.3 44 Basic metal materials.......................... 5.57 124.0 122.9 130.5 127.7 124.8 121.4 119.9 117.7 118.8 116.5 116.4 110.3 45 Nondurable goods materials...................... 10.47 174.9 173.8 174.6 175.8 176.7 177.2 178.3 179.5 180.8 178.3 176.3 173.6 170.6 46 Textile, paper, and chemical materials . 7.62 182.9 181.5 182.8 184.3 185.9 186.1 186.7 187.8 188.6 185.7 184.0 181.6 178.8 47 Textile materials.................................. 1.85 121.0 118.8 122.2 120.6 124.4 124.3 123.2 123.7 122.3 122.5 120.0 117.7 48 Paper materials.................................... 1.62 143.2 140.1 146.2 146.7 148.1 148.6 148.4 148.2 146.3 139.9 141.3 140.0 49 Chemical materials.............................. 4.15 226.1 225.7 224.1 227.5 228.2 228.4 230.2 232.0 234.8 231.8 229.3 226.4 50 Containers, nondurable.......................... 1.70 164.5 163.3 163.1 162.9 161.8 166.1 168.1 169.6 174.1 172.6 167.7 164.9 51 Nondurable materials n.e.c...................... 1.14 136.7 138.4 137.5 138.2 136.9 134.4 137.4 138.8 138.5 137.2 137.2 132.9 52 Energy materials ........................................ 8.48 128.4 127.7 129.1 127.7 128.1 128.5 130.1 128.7 127.7 130.5 130.6 130.7 128.7 53 Primary energy ........................................ 4.65 113.0 111.7 112.8 112.0 113.6 114.6 114.9 113.5 113.1 113.5 114.3 114.7 54 Converted fuel materials........................ 3.82 147.2 147.2 148.8 146.9 145.7 145.3 148.7 147.3 145.3 151.3 150.5 150.1 Supplementary groups 55 Home goods and clothing.......................... 9.35 139.7 139.1 139.3 138.6 139.5 139.1 139.5 140.0 139.3 137.1 136.3 134.1 129.4 56 Energy, total................................................ 12.23 137.8 137.6 137.1 136.8 136.8 137.2 139.0 138.1 137.3 139.0 139.0 138.8 136.8 57 Products .................................................... 3.76 158.8 159.9 155.2 157.4 156.5 157.1 159.0 159.3 159.1 158.1 158.1 157.0 58 Materials .................................................. 8.48 128.4 127.7 129.1 127.7 128.1 128.5 130.1 128.7 127.7 130.5 130.6 130.7 128.7 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Output A49 2.13 Continued 1967 1979 1980 Grouping pro­ 1979 SIC por­ code tion May July Aug. Sept. Oct. Nov. Dec. Jan. Feb/ Mar. Apr.P Maye Index (1967 = 100) Major Industry 1 Mining and utilities .................... 12.05 144.5 143.4 143.7 144.9 144.5 146.0 147.7 148.3 147.4 148.6 149.9 149.9 149.3 2 Mining ...................................... 6.36 125.3 122.8 124.7 126.4 125.8 128.1 130.0 131.6 132.6 132.8 132.8 133.5 133.2 3 Utilities...................................... 5.69 166.1 166.5 164.8 165.5 165.3 166.1 167.4 167.0 163.9 166.1 169.1 168.2 167.3 4 Electric .................................. 3.88 185.8 186.4 182.2 183.6 184.1 184.3 185.7 186.0 183.0 185.0 5 Manufacturing .............................. 87.95 153.2 153.8 154.1 152.4 153.5 153.2 153.0 152.8 153.4 152.7 151.8 148.3 145.0 6 Nondurable .............................. 35.97 163.3 162.8 164.1 164.3 164.6 164.0 164.5 164.7 166.1 165.1 164.3 161.8 159.6 7 Durable .................................... 51.98 146.3 147.6 147.2 144.2 145.9 145.7 145.0 144.5 144.7 144.1 143.2 138.9 135.0 Mining 8 Metal ............................................ 10 .51 126.8 123.1 128.6 126.5 122.1 124.1 132.0 136.8 137.6 136.6 133.1 123.1 9 Coal .............................................. 11,12 .69 133.6 133.4 137.1 144.1 142.6 144.7 141.9 145.0 141.0 136.0 137.2 143.4 140.4 10 Oil and gas extraction................ 13 4.40 121.7 118.6 120.4 121.6 121.6 124.2 126.0 127.2 128.5 130.3 131.3 132.9 133.7 11 Stone and earth minerals .......... 14 .75 137.6 137.8 136.4 138.3 137.5 138.2 141.2 141.0 145.3 142.0 136.8 134.8 Nondurable manufactures 12 Foods ............................................ 20 8.75 147.9 149.2 149.4 148.1 148.8 148.6 148.3 148.9 150.0 150.2 150.4 149.2 13 Tobacco products ........................ 21 .67 117.1 120.2 118.9 107.5 115.6 115.6 113.0 116.6 118.7 120.0 122.2 14 Textile mill products .................. 22 2.68 143.8 141.5 143.0 144.1 146.9 146.0 147.9 147.1 147.8 143.7 142.9 140.0 15 Apparel products ........................ 23 3.31 130.7 128.2 129.7 130.1 131.2 128.5 128.8 128.3 127.2 128.0 126.9 16 Paper and products .................... 26 3.21 150.8 147.9 154.0 153.9 155.3 154.1 153.3 154.7 156.0 150.5 151.6 147.3 144.0 17 Printing and publishing.............. 27 4.72 136.9 136.8 135.6 137.7 137.1 137.2 136.2 137.8 138.9 139.9 138.8 135.5 133.3 18 Chemicals and products.............. 28 7.74 210.4 209.7 210.5 213.1 212.0 211.4 215.1 216.5 217.7 216.0 214.7 212.3 19 Petroleum products .................... 29 1.79 143.6 142.4 143.9 143.0 143.1 141.1 142.1 142.6 146.7 144.4 141.2 138.2 132.0 20 Rubber and plastic products .... 30 2.24 270.0 270.0 278.0 275.7 272.9 274.5 271.3 262.3 266.9 267.9 264.2 260.5 21 Leather and products.................. 31 .86 71.3 72.3 69.7 69.7 70.8 70.1 70.4 71.2 73.2 71.9 71.7 69.6 Durable manufactures 22 Ordnance, private and government .......................... 19,91 3.64 75.5 75.3 74.6 74.9 75.3 75.3 77.0 77.0 76.6 76.7 75.8 76.0 75.8 23 Lumber and products.................. 24 1.64 136.9 136.1 135.2 138.0 138.6 138.7 136.1 131.7 131.6 130.2 125.5 116.8 24 Furniture and fixtures................ 25 1.37 161.4 159.6 159.5 161.7 162.0 163.3 162.9 161.0 161.0 159.2 158.5 156.9 25 Clay, glass, stone products........ 32 2.74 163.3 163.8 163.3 161.4 160.6 162.3 162.8 164.4 165.1 162.6 156.7 150.9 26 Primary metals ............................ 33 6.57 121.2 121.0 127.1 121.0 121.7 118.0 117.2 115.4 116.4 111.9 113.6 107.5 99.6 27 Iron and steel .......................... 331.2 4.21 113.2 114.3 119.0 112.0 115.0 108.2 108.0 106.6 107.2 103.4 106.0 97.5 28 Fabricated metal products.......... 34 5.93 148.5 150.3 149.3 147.6 146.5 147.5 146.9 146.1 145.0 145.3 144.2 140.0 134.1 29 Nonelectrical machinery ............ 35 9.15 163.6 164.3 165.3 166.2 165.1 162.3 162.8 162.9 166.9 166.1 165.9 162.6 160.7 30 Electrical machinery .................. 36 8.05 175.0 174.7 174.4 171.7 176.7 177.3 179.5 181.2 181.7 179.7 179.5 177.7 175.1 31 Transportation equipment.......... 37 9.27 135.3 141.9 135.5 124.7 131.7 133.7 128.2 125.9 122.4 126.2 124.3 115.6 111.6 32 Motor vehicles and parts........ 371 4.50 160.0 176.3 160.2 138.5 150.6 150.6 139.9 135.4 127.6 135.4 131.9 115.3 108.0 33 Aerospace and miscellaneous transportation equipment 372-9 4.77 112.0 109.6 112.2 111.8 113.9 117.7 117.1 117.0 117.5 117.5 117.2 115.8 115.0 34 Instruments .................................. 38 2.11 174.9 174.7 174.0 173.9 172.9 175.0 173.3 175.0 175.8 175.0 174.2 174.4 171.6 35 Miscellaneous manufactures----- 39 1.51 153.7 150.7 155.7 155.7 153.6 154.5 155.3 153.7 154.0 152.0 151.5 151.3 149.5 Gross value (billions of 1972 dollars, annual rates) Major Market 36 Products, total.............................. 507.4 624.1 632.3 622.7 613.0 622.6 621.6 617.8 619.0 617.1 620.8 615.8 602.2 590.6 37 Final .............................................. 390.92 479.9 488.2 479.6 468.8 478.8 477.6 474.4 475.2 472.7 477.5 473.9 464.8 456.8 38 Consumer goods ...................... 277.52 326.3 331.5 326.0 319.2 323.6 324.6 321.9 321.6 319.6 321.8 320.3 313.6 307.5 39 Equipment ................................ 113.42 153.7 156.7 153.6 149.6 155.2 153.0 152.5 153.6 153.1 155.7 153.6 151.1 149.3 40 Intermediate ................................ 116.62 144.2 144.2 143.2 144.2 143.8 144.0 143.4 143.8 144.5 143.3 141.9 137.4 133.7 1. The industrial production series has been revised. For a description of the Note. Published groupings include some series and subtotals not shown sepachanges, see “Revision of Industrial Production Index” in the August 1979 Bul- rately. For description and historical data, see Industrial Production—1976 Revision letin, pp. 603-05. (Board of Governors of the Federal Reserve System: Washington, D.C.), Decem- 2. 1972 dollars. ber 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A50 Domestic Nonfinancial Statistics □ June 1980 2.14 HOUSING AND CONSTRUCTION Monthly figures are at seasonally adjusted annual rates except as noted. 1979 1980 Item 1977 1978 1979 Oct. Nov. Dec. Jan.' Feb.' Mar.' Apr. Private residential real estate activity (thousands of units) New Units 1 Permits authorized................................... 1,677 1,801 1,539 1,542 1,263 1,244 1,264 1,142 932 800 2 1-family ................................................ 1,125 1,183 971 927 751 780 761 695 538 467 3 2-or-more-family................................... 551 618 568 615 512 464 503 447 394 333 4 Started ...................................................... 1,987 2,020 1,745 1,710 1,522 1,548 1,419 1,330 1,041 1,019 5 1-family ................................................. 1,451 1,433 1,194 1,139 980 1.055 1,002 786 615 625 6 2-or-more-family .................................. 536 587 551 571 542 493 417 544 426 394 7 Under construction, end of period1 ... 1,208 1,310 1,140' 1,212' 1,188' 1,160' 1,163 1,097 1,070 n.a. 8 1-family ................................................ 730 765 639' 705' 687' 662' 669' 623 593 n.a. 9 2-or-more-family .................................. 478 546 501' 507' 501' 498 494' 474 477 n.a. 10 Completed ................................................. 1,656 1,868 1,855' 1,819' 1,831 1,880' 1,787' 1,830 1,669 n.a. 11 1-family ................................................ 1,258 1,369 1,286' 1,255' 1,240' 1,328' 1,276' 1,223 1,085 n.a. 12 2-or-more-family .................................. 399 498 570' 564 591' 552 511 607 584 n.a. 13 Mobile homes shipped............................ 277 276 277 287 251 241 276 270 226 n.a. Merchant builder activity in 1-family units 14 Number sold ............................................ 820 818 709' 674 617' 571' 584 546 459 364 15 Number for sale, end of period1.......... 408 419 402' 407 399' 398' 396' 384 378 364 Price (thousand of dollars)2 Median 16 Units sold ............................................ 49.0 55.8 62.7 62.3 63.9' 61.5' 63.2' 65.0 62.7 64.1 17 Units for sale ...................................... 48.2 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Average 18 Units sold ............................................ 54.4 62.7 71.9' 71.5 74.2' 72.6' 72.5' 77.0 71.4 73.9 Existing Units (1-family) 19 Number sold ............................................ 3,572 3,905 3,742 3,870 3,450 3,350 3,210 2,990 2,750 2,420 Price of units sold (thous. of dollars)2 20 Median ...................................................... 42.8 48.7 55.5 56.3 55.6 56.5 57.9 59.0 59.5 60.4 21 Average .................................................... 47.1 55.1 64.0 65.2 64.6 65.2 68.2 69.4 69.4 70.6 Value of new construction3 (millions of dollars) Construction 22 Total put in place.................................... 173,998 206,223 226,885 238,707' 237,698' 242,009 249,966 243,015' 229,858 221,667 23 Private ...................................................... 135,824 160,403 178,168 185,948' 185,802' 189,906 190,558 186,696' 176,126 169,391 24 Residential............................................ 80,957 93,425 97,574 100,663' 101,088' 101,982 99,654 97,680' 89,769 83,096 25 Nonresidential, total .......................... 54,867 66,978 80,594 85,285' 84,714' 87,924 90,904 89,016 86,357 86,295 Buildings 26 Industrial ...................................... 7,713 10,993 14,424 15,019 15,022 15,249 15,559 15,306 14,197 13,130 27 Commercial .................................. 14,789 18,568 24,234 26,663 26,923 28,857 30,707 29,423 29,122 29,116 28 Other ............................................ 6,200 6,739 7,352 7,851 7,722 8,194 9,090 8,444 8,324 8,218 29 Public utilities and other................ 26,165 30,678 34,584 35,752' 35,047' 35,624 35,548 35,843 34,714 35,831 30 Public ........................................................ 38,172 45,821 48,722 52,759' 51,895' 52,103 59,409 56,318' 53,732' 52,273 31 Military ................................................ 1,428 1,498 1,629 1,778' 1,742' 1,724 1,844 1,753 1,791' 1,827 32 Highway ................................................ 8,984 10,286 11,167' 14,518 11,900 12,495' 15,586 15,192 12,574 n.a. 33 Conservation and development........ 3,862 4,436 4,736' 4,291' 4,955' 5,186' 5,225 5,263 5,582 n.a. 34 Other4.................................................... 23,898 29,601 31,190' 32,172' 33,298' 32,698' 36,754 34,110' 33,785' n.a. 1. Not at annual rates. Note. Census Bureau estimates for all series except (a) mobile homes, which 2. Not seasonally adjusted. are private, domestic shipments as reported by the Manufactured Housing Institute 3. Value of new construction data in recent periods may not be strictly com­ and seasonally adjusted by the Census Bureau, and (b) sales and prices of existing parable with data in prior periods due to changes by the Bureau of the Census in units, which are published by the National Association of Realtors. All back and its estimating techniques. For a description of these changes see Construction current figures are available from originating agency. Permit authorizations are Reports (C-30-76-5), issued by the Bureau in July 1976. those reported to the Census Bureau from 14,000 jurisdictions through 1977, and 4. Beginning January 1977 “Highway” imputations are included in “Other”. 16,000 jurisdictions beginning with 1978. 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 1979 1980 1979 1980 A 19 p 8 r 0 . 1979 1980 (1967 Apr. Apr. = 100)1 June Sept. Dec. Mar. Dec. Jan. Feb. Mar. Apr. Consumer Prices2 1 All items......................................................... 10.4 14.7 12.8 13.8 13.7 18.1 1.2 1.4 1.4 1.4 .9 242.5 2 Commodities ................................................. 10.8 13.1 12.7 13.3 12.5 16.1 1.1 1.4 1.2 1.2 .5 229.9 3 Food ........................................................... 12.0 7.2 6.4 6.5 12.1 3.8 1.4 0.0 0 1.0 .5 249.1 4 Commodities less food .......................... 10.3 15.7 15.6 16.4 12.7 22.1 1.1 2.0 1.7 1.3 .5 218.6 5 Durable ................................................. 10.2 9.5 9.4 9.1 13.2 7.6 1.0 1.1 .5 .2 .5 204.9 6 Nondurable ........................................... 10.4 23.7 24.7 25.2 12.8 39.8 1.4 3.2 3.0 2.4 .6 234.6 7 Services ......................................................... 9.9 16.9 13.21 14.3 15.8 20.9 1.4 1.4 1.5 1.9 1.5 265.3 8 Rent ........................................................... 6.5 8.7 8.2 10.2 9.0 8.3 .4 .7 .8 .5 .2 187.0 9 Services less rent .................................... 10.5 18.1 13.9 14.9 16.9 22.8 1.5 1.5 1.7 2.0 1.7 280.0 Other groupings 10 All items less food....................................... 10.1 16.3 14.4 15.4 14.2 21.7 1.2 1.8 1.6 1.5 1.1 239.9 11 All items less food and energy.................. 9.4 13.0 10.1 10.9 13.9 15.7 1.2 1.3 1.1 1.2 1.1 228.5 12 Homeownership ........................................... 14.2 22.2 17.8 19.5 25.6 24.1 1.8 1.9 1.5 2.1 1.9 307.7 Producer Prices 13 Finished goods ............................................. 10.4 13.5 7.9 16.1 13.3' 18.9' .8 1.5' 1.5 1.4 .5 240.0 14 Consumer ................................................. 10.8 14.9 7.1 20.7 14.6' 21.2' .9' 1.4' 1.8 1.6 0.0 241.6 15 Foods ..................................................... 11.4 .4 -9.2 15.3 8.6' -1.2' .3' .9' -.5 1.1 -2.8 228.7 16 Excluding foods .................................. 10.4 23.2 17.2 23.4 17.9' 34.2' 1.2' 2.7' 2.9 1.9 1.4 245.5 17 Capital equipment .................................. 9.4 10.2 9.4 5.9 10.0' 12.7' .9' 1.5' .7 .8 1.9 235.8 18 Materials ....................................................... 12.3 14.1 12.8 19.7 15.8' 16.4' 1.1 1.9 2.0 -.1 -.6 278.9 19 Intermediate3 ........................................... 11.0 17.2 15.4 19.4 17.0' 23.1' 1.2' 2.9' 1.7 .7 .3 277.4 Crude 20 Nonfood................................................. 18.4 24.1 23.1 25.1 27.8' 21.4' 2.2' 3.2' 3.2 -1.4 -.5 413.5 21 Food ....................................................... 16.3 -6.4 -4.5 16.4 5.7 -16.7 .2 -3.8 2.2 -2.7 -6.1 235.5 1. Not seasonally adjusted. 3. Excludes intermediate materials for food manufacturing and manufactured 2. Figures for consumer prices are those for all urban consumers. animal feeds. Source. Bureau of Labor Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A52 Domestic Nonfinancial Statistics □ June 1980 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates. 1978 1979 1980 Account 1977 1978 1979 Q4 Ql Q2 Q3 Q4 Ql Gross National Product 1 Total .............................................................................. 1,899.5 2,127.6 2,368.8 2,235.2 2,292.1 2,329.8 2,396.5 2,456.9C 2,516.1 By source 2 Personal consumption expenditures ................................ 1,210.0 1,350.8 1,509.8 1,415.4 1,454.2 1,475.9 1,528.6 1,580.4 1,628.7 3 Durable goods .................................................................... 178.8 200.3 213.0 212.1 213.8 208.7 213.4 216.2 220.4 4 Nondurable goods ............................................................. 481.3 530.6 596.9 558.1 571.1 581.2 604.7 630.7 650.6 5 Services ................................................................................. 549.8 619.8 699.8 645.1 669.3 686.0 710.6 733.5 757.8 6 Gross private domestic investment.................................. 303.3 351.5 387.2 370.5 373.8 395.4 392.3 387.2 384.0 7 Fixed investment ............................................................... 281.3 329.1 369.0 349.8 354.6 361.9 377.8 381.7 383.9 8 Nonresidential ............................................................... 189.4 221.1 254.9 236.1 243.4 249.1 261.8 265.2 273.3 9 Structures...................................................................... 62.6 76.5 92.6 84.4 84.9 90.5 95.0 100.2 103.1 10 Producer’s durable equipment............................. 126.8 144.6 162.2 151.8 158.5 158.6 166.7 165.1 170.2 11 Residential structures .................................................. 91.9 108.0 114.1 113.7 111.2 112.9 116.0 116.4 110.5 12 Nonfarm........................................................................ 88.8 104.4 110.2 110.0 107.8 109.1 112.0 112.1 106.2 13 Change in business inventories .................................... 21.9 22.3 18.2 20.6 19.1 33.4 14.5 5.6 .1 14 Nonfarm .......................................................................... 20.7 21.3 16.5 19.3 18.8 32.6 12.6 2.1 -.1 15 Net exports of goods and services.................................... -9.9 -10.3 -4.6 -4.5 4.0 -8.1 -2.3 -11.9 -14.0 16 Exports ................................................................................. 175.9 207.2 257.5 224.9 238.5 243.7 267.3 280.4 304.2 17 Imports ................................................................................. 185.8 217.5 262.1 229.4 234.4 251.9 269.5 292.4 318.2 18 Government purchases of goods and services............. 396.2 435.6 476.4 453.8 460.1 466.6 477.8 501.2 517.4 19 Federal ................................................................................... 144.4 152.6 166.6 159.0 163.6 161.7 162.9 178.4 186.2 20 State and local .................................................................... 251.8 283.0 309.8 294.8 296.5 304.9 314.9 322.8 331.2 By major type of product 21 Final sales, total...................................................................... 1,877.6 2,105.2 2,350.6 2,214.5 2,272.9 2,296.4 2.381.9 2,451.4 2,516.0 22 Goods..................................................................................... 842.2 930.0 1,030.5 983.8 1,011.8 1,018.1 1,036.0 1,056.3 1,082.5 23 Durable ............................................................................ 345.9 380.4 423.1 402.3 425.5 422.4 424.4 420.2 420.1 24 Nondurable ...................................................................... 496.3 549.6 607.4 581.6 586.2 595.7 611.6 636.1 662.4 25 Services ................................................................................. 866.4 969.3 1,085.1 1,005.3 1,041.4 1,064.2 1,100.6 1,134.0 1.168.2 26 Structures ............................................................................ 190.9 228.2 253.2 246.0 238.9 247.5 259.8 266.6 265.4 27 Change in business inventories......................................... 21.9 22.3 18.2 20.6 19.1 33.4 14.5 5.6 .1 28 Durable goods ................................................................... 11.9 13.9 13.0 13.4 18.4 24.3 7.3 1.8 -14.3 29 Nondurable goods ............................................................. 10.0 8.4 5.2 7.2 .7 9.1 7.2 3.8 -14.4 30 Memo: Total GNP in 1972 dollars............................ 1,340.5 1,399.2 1,431.6 1,426.6 1,430.6 1,422.3 1,433.3 1,440.3 1,442.6 National Income 31 Total .............................................................................. 1,525.8 1,724.3 1,925.6 1,820.0 1,869.0 1,897.9 1,941.9 1,990.4 2,031.4 32 Compensation of employees ............................................. 1,156.9 1,304.5 1,227.4 1,364.8 1,411.2 1,439.7 1,472.9 1,513.2 1,554.6 33 Wages and salaries............................................................. 984.0 1,103.5 1,459.2 1,154.7 1,189.4 1,211.5 1,238.0 1,270.7 1,303.0 34 Government and government enterprises........... 201.3 218.0 233.5 225.1 228.1 231.2 234.4 240.2 243.5 35 Other ................................................................................. 782.7 885.5 993.9 929.6 961.3 980.3 1,003.6 1,030.5 1,059.5 36 Supplement to wages and salaries................................ 172.9 201.0 231.8 210.1 221.8 228.2 234.8 242.5 251.6 37 Employer contributions for social insurance .... 81.2 94.6 109.1 98.2 105.8 107.9 109.9 113.0 117.2 38 Other labor income ...................................................... 91.8 106.5 122.7 111.9 116.0 120.3 124.9 129.6 134.4 39 Proprietors’ income1 ............................................................. 100.2 116.8 130.8 125.7 129.0 129.3 130.3 134.5 129.8 40 Business and professional1 ............................................. 80.5 89.1 98.0 94.4 94.8 95.5 99.4 102.1 102.3 41 Farm1 ..................................................................................... 19.6 27.7 32.8 31.3 34.2 33.7 30.9 32.5 27.5 42 Rental income of persons2.................................................. 24.7 25.9 26.9 27.1 27.3 26.8 26.6 27.0 27.0 43 Corporate profits1 ................................................................. 150.0 167.7 179.0 184.8 178.9 176.6 180.8 176.4 171.8 44 Profits before tax3 ............................................................. 177.1 206.0 237.4 227.4 233.3 227.9 242.3 243.0 257.1 45 Inventory valuation adjustment.................................... -15.2 -25.2 -41.8 -28.8 -39.9 -36.6 -44.0 -46.5 -63.2 46 Capital consumption adjustment.................................. -12.0 -13.1 -16.7 -13.8 -14.5 -14.7 -17.6 -20.1 -22.1 47 Net interest ............................................................................... 94.0 109.5 129.7 117.6 122.6 125.6 131.5 139.2 148.1 1. With inventory valuation and capital consumption adjustments. 3. For after-tax profits, dividends, and the like, see table 1.50. 2. With capital consumption adjustments. Source. Survey of Current Business (Department 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. 1978 1979 1980 1977 1978 1979' Q4 Ql Q2 Q3 Q4 Ql Personal Income and Saving 1 Total personal income................................... 1.531.6 1,717.4 1.924.2 1.803.1 1.852.6 1,892.5 1.946.6 2.005.0 2.057.2 2 Wage and salary disbursements................................... 984.0 1.103.3 1,227.6 1.154.3 1,189.3 1.212.4 1,238.1 1,270.5 1.303.2 3 Commodity-producing industries............................ 343.1 387.4 435.2 408.6 423.0 431.7 438.3 447.8 459.5 4 Manufacturing......................................................... 266.0 298.3 330.9 312.7 324.8 328.5 331.9 338.3 346.7 5 Distributive industries............................................... 239.1 269.4 300.8 281.6 291.1 295.8 304.0 312.4 320.1 6 Service industries....................................................... 200.5 228.7 257.9 239.4 247.2 252.8 261.3 270.2 280.0 7 Government and government enterprises............ 201.3 217.8 233.7 224.7 228.0 232.1 234.5 240.1 243.6 8 Other labor income....................................................... 91.8 106.5 122.7 111.9 116.0 120.3 124.9 129.6 134.4 9 Proprietors’ income1 ..................................................... 100.2 116.8 130.8 125.7 129.0 129.3 130.3 134.5 129.8 10 Business and professional1 ....................................... 80.5 89.1 98.0 94.4 94.8 95.5 99.4 102.1 102.3 11 Farm1 ........................................................................... 19.6 27.7 32.8 31.3 34.2 33.7 30.9 32.5 27.5 12 Rental income of persons2........................................... 24.7 25.9 26.9 27.1 27.3 26.8 26.6 27.0 27.0 13 Dividends ....................................................................... 42.1 47.2 52.7 49.7 51.5 52.3 52.8 54.4 56.7 14 Personal interest income............................................... 141.7 163.3 192.1 174.3 181.0 187.6 194.4 205.5 217.9 15 Transfer payments ......................................................... 208.4 224.1 252.0 231.8 237.3 243.6 260.8 266.5 274.8 16 Old-age survivors, disability, and health insurance benefits ............................................................... 105.0 116.3 132.4 121.5 123.8 127.1 138.7 140.0 142.0 17 Less: Personal contributions for social insurance 61.3 69.6 80.7 71.8 78.7 79.8 81.2 82.9 86.6 18 Equals: Personal income .......................................... 1.531.6 1.717.4 1.924.2 1.803.1 1.852.6 1.892.5 1.946.6 2.005.0 2.057.2 19 Less: Personal tax and nontax payments.............. 226.4 259.0 299.9 278.2 280.4 290.7 306.6 321.9 321.0 20 Equals: Disposable personal income ...................... 1.305.1 1.458.4 1.629.3 1,524.8 1,572.2 1.601.7 1,640.0 1.683.1 1.736.2 21 Less: Personal outlays.............................................. 1.240.2 1.386.4 1,550.5 1.453.4 1,493.0 1.515.8 1.569.7 1,623.4 1,672.1 22 Equals: Personal saving ............................................ 65.0 72.0 73.8 71.5 79.2 85.9 70.3 59.7 64.2 Memo: Per capita (1972 dollars) 23 Gross national product.................... 6,181 6,402 6,494 6,506 6,514 6,459 6,494 6,509 6,505 24 Personal consumption expenditures 3,974 4,121 4,194 4,197 4,197 4,155 4,195 4,227 4,220 25 Disposable personal income............ 4,285 4,449 4,512 4,522 4,536 4,510 4,501 4,502 4,499 26 Saving rate (percent)............................. 5.0 4.9 4.5 4.7 5.0 5.4 4.3 3.5 3.7 Gross Saving 27 Gross saving ................................................................. 276.1 324.6 363.9 346.9 362.2 374.3 367.3 351.9 344.4 28 Gross private saving ................................................... 295.6 324.9 350.1 336.1 345.2 360.5 352.1 340.7 341.0 29 Personal saving............................................................. 65.0 72.0 73.8 71.5 79.2 85.9 70.3 59.7 64.2 30 Undistributed corporate profits1 ................................ 35.2 36.0 33.4 40.1 36.1 35.6 34.0 25.9 13.5 31 Corporate inventory valuation adjustment............... -15.2 -25.2 -41.8 -28.8 -39.9 -36.6 -44.0 -46.5 -63.2 Capital consumption allowances 32 Corporate .................................................................... 121.3 132.9 147.7 136.8 139.9 145.1 150.4 155.3 159.6 33 Noncorporate ............................................................... 74.1 84.0 95.3 87.7 89.9 93.9 97.5 99.8 103.7 34 Wage accruals less disbursements.............................. 35 Government surplus, or deficit (-), national income and product accounts............................................... -19.5 -.3 13.5 10.8 15.8 12.7 14.0 10.0 2.2 36 Federal ........................................................................... -46.3 -27.7 -11.2 -16.3 -11.7 -7.0 -11.3 -15.7 -21.6 37 State and local ......................................................... 26.8 27.4 24.7 27.1 27.6 19.7 25.3 25.8 23.8 38 Capital grants received by the United States, net 1.1 1.1 1.1 1.1 1.1 1.1 39 Gross investment ........................................................ 283.6 367.6 362.8 373.1 375.6 359.1 353.4 40 Gross private domestic . 303.3 351.5 387.2 370.5 373.8 395.4 392.3 387.2 384.0 41 Net foreign .................. -19.6 -23.5 -19.5 -19.4 -11.0 -22.3 -16.7 -28.1 -30.6 42 Statistical discrepancy -1.3 8.3 7.2 1. With inventory valuation and capital consumption adjustments. Source. Survey of Current Business (Department of Commerce). 2. With capital consumption adjustment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 International Statistics □ June 1980 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data are seasonally adjusted except as noted.1 1978 1979 Item credits or debits 1977 1978 1979 Q4 Ql Q2 Q3 Q4 1 Balance on current account ..................................................... -14,092 -13,467 -317 105 274 -810 1,139 -923 2 Not seasonally adjusted......................................................... 1,130 1,737 -178 -2,717 841 3 Merchandise trade balance2 ................................................. -30,873 -33,759 -29,450 -5,951 -6,197 -7,409 -7,248 -8,596 4 Merchandise exports ......................................................... 120,816 142,054 182,074 39,421 41,435 42,890 47,235 50,514 5 Merchandise imports ......................................................... -151,689 -175,813 -211,524 -45,372 -47,632 -50,299 -54,483 -59,110 6 Military transactions, net .................................................... 1,679 492 -1,181 -239 34 -217 -418 -580 7 Investment income, net3 ....................................................... 17,989 21,645 32,314 6,599 6,814 7,414 9,174 8,912 8 Other service transactions, net............................................. 1,783 3,241 3,648 1,010 945 765 1,000 935 9 MEMO: Balance on goods and services3 4........................ -9,423 -8,381 5,332 1,419 1,596 553 2,508 671 10 Remittances, pensions, and other transfers...................... -1,895 -1,934 -2,160 -524 -517 -466 -497 -680 11 U.S. government grants (excluding military).................... -2,775 -3,152 -3,488 -790 -805 -897 -872 -914 12 Change in U.S. government assets, other than official re­ serve assets, net (increase, - ) ........................................ -3,693 -4,656 -3,780 -994 -1,094 -1,001 -763 -922 13 Change in U.S. official reserve assets (increase, - ) .......... -375 732 -1,107 182 -3,585 343 2,779 -644 14 Gold ......................................................................................... -118 -65 -65 -65 0 0 0 -65 15 Special drawing rights (SDRs) ............................................ -121 1,249 -1,136 1,412 -1,142 6 0 0 16 Reserve position in International Monetary Fund.......... -294 4,231 -189 3,275 -86 -78 -52 27 17 Foreign currencies ................................................................. 158 -4,683 283 -4,440 -2,357 415 2,831 -606 18 Change in U.S. private assets abroad (increase, -)3........ -31,725 -57,033 -58,536 -29,442 -2,943 -15,494 -26,825 -13,273 19 Bank-reported claims............................................................. -11,427 -33,023 -26,089 -21,980 6,572 -8,266 -17,127 -7,268 20 Nonbank-reported claims ..................................................... -1,940 -3,853 -2,718 -1,898 -2,719 668 -667 n.a. 21 U.S. purchase of foreign securities, net............................ -5,460 -3,487 -4,967 -918 -1,056 -629 -2,164 -1,118 22 U.S. direct investments abroad, net3................................ -12,898 -16,670 -24,762 -4,646 -5,740 -7,267 -6,867 -4,887 23 Change in foreign official assets in the United States (increase, + )....................................................................... 36,656 33,758 -15,192 18,764 -9,391 -10,043 5,745 -1,503 24 U.S. Treasury securities ....................................................... 30,230 23,542 -22,470 13,422 -8,872 -12,859 5,030 -5,769 25 Other U.S. government obligations .................................. 2,308 656 465 -115 -5 94 335 41 26 Other U.S. government liabilities5 .................................... 1,240 2,754 -748 2,045 -164 257 191 -1,031 27 Other U.S. liabilities reported by U.S. banks.................. 773 5,411 6,553 3,156 -563 2,321 83 4,712 28 Other foreign official assets6 ............................................... 2,105 1,395 1,008 256 213 145 106 544 29 Change in foreign private assets in the United States (increase, +)3..................................................................... 14,167 29,956 49,094 10,475 10,868 16,100 18,544 3,582 30 U.S. bank-reported liabilities............................................... 6,719 16,975 32,702 7,556 7,157 12,067 13,006 472 31 U.S. nonbank-reported liabilities......................................... 473 1,640 1,118 -177 -651 1,086 683 n.a. 32 Foreign private purchases of U.S. Treasury securities, net ..................................................................................... 534 2,180 4,725 1,549 2,583 -239 1,460 921 33 Foreign purchases of other U.S. securities, net.............. 2,713 2,867 2,874 540 790 1,161 605 319 34 Foreign direct investments in the United States, net3 ... 3,728 6,294 7,674 1,007 989 2,025 2,790 1,871 35 Allocation of SDRs ................................................................... 0 0 1,139 0 1,139 0 0 0 36 Discrepancy ................................................................................. -937 10,711 28,699 910 4,732 10,904 -619 13,682 37 Owing to seasonal adjustments .......................................... 1,291 1,117 482 -3,821 2,222 38 Statistical discrepancy in recorded data before seasonal adjustment ....................................................................... -937 10,711 28,699 -381 3,615 10,422 3,202 11,460 Memo: Changes in official assets 39 U.S. official reserve assets (increase, - ) .......................... -375 732 -1,107 182 -3,585 343 2,779 -644 40 Foreign official assets in the United States (increase, + ) ................................................................... 35,416 31,004 -14,444 16,719 -9,227 -10,299 5,554 -472 41 Change in Organization of Petroleum Exporting Countries official assets in the United States (part of line 23 above) ................................................................................... 6,351 -727 4,737 1,803 -1,916 151 1,658 4,844 42 Transfers under military grant programs (excluded from lines 4, 6, and 11 above)................................................... 204 259 288 63 31 48 84 124 1. Seasonal factors are no longer calculated for lines 13 through 42. 5. Primarily associated with military sales contracts and other transactions ar­ 2. Data are on an international accounts (IA) basis. Differs from the census ranged with or through foreign official agencies. basis primarily because the IA basis includes imports into the U.S. Virgin Islands, 6. Consists of investments in U.S. corporate stocks and in debt securities of and it excludes military exports, which are part of line 6. private corporations and state and local governments. 3. Includes reinvested earnings of incorporated affiliates. 4. Differs from the definition of “net exports of goods and services” in the Note. Data are from Bureau of Economic Analysis, Survey of Current Business national income and product (GNP) account. The GNP definition makes various (U.S. Department of Commerce). adjustments to merchandise trade and service transactions. 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. 1979 1980 Item 1977 1978 1979 Oct. Nov. Dec. Jan. Feb. Mar. Apr. 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments ........................................... 121,150 143,578 181,637 16,680 16,928 16,742 17,348 17,233 18,534 18,468 2 GENERAL IMPORTS including mer­ chandise for immediate consump­ tion plus entries into bonded warehouses ...................................... 147,685 171,978 206,326 19,037 18,548 19,665 20,945 21,640 20,607 19,308 3 Trade balance ........................................ -26,535 -28,400* -24,690 -2,357 -1,620 -2,923 -3,597 -4,407 -2,073 -840 Note. Bureau of Census data reported on a free-alongside-ship (f.a.s.) value On the import side, the largest single adjustment is the addition of imports into basis. Effective January 1978, major changes were made in coverage, reporting, the Virgin Islands (largely oil for a refinery on St. Croix), which are not included and compiling procedures. The intemational-accounts-basis data adjust the Census in Census statistics. basis data for reasons of coverage and timing. On the export side, the largest adjustments are: (a) the addition of exports to Canada not covered in Census Source. FT 900 “Summary of U.S. Export and Import Merchandise Trade” statistics, and (b) the exclusion of military exports (which are combined with other (U.S. Department of Commerce, Bureau of the Census). military transactions and are reported separately in the “service account”). 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period 1979 1980 Type 1977 1978 1979 Nov. Dec. Jan. Feb. Mar. Apr. May 1 Total1 ..................................................... 19,312 18,650 18,928 19,261 18,928 20,962 20,840 21,448 21,521 21,794 2 Gold stock, including Exchange Stabili­ zation Fund1 .................................... 11,719 11,671 11,172 11,112 11,172 11,172 11,172 11,172 11,172 11,172 3 Special drawing rights2 3 ........................ 2,629 1,558 2,724 2,705 2,724 3,871 3,836 3,681 3,697 3,744 4 Reserve position in International Mone­ tary Fund2 ........................................ 4,946 1,047 1,253 1,322 1,253 1,251 1,287 1,222 1,094 1,157 5 Foreign currencies4 ................................ 18 4,374 3,779 4,122 3,779 4,668 4,545 5,373 5,558 5,721 1. Gold held under earmark at Federal Reserve Banks for foreign and inter­ 3. Includes allocations by the International Monetary Fund of SDRs as follows: national accounts is not included in the gold stock of the United States; see table $867 million on Jan. 1, 1970; $717 million on Jan. 1, 1971; $710 million on Jan. 3.22. 1, 1972; $1,124 million on Jan. 1, 1979; and $1,150 million Jan. 1, 1980; plus net 2. Beginning July 1974, the IMF adopted a technique for valuing the SDR based transactions in SDRs. on a weighted average of exchange rates for the currencies of 16 member countries. 4. Beginning November 1978, valued at current market exchange rates. The U.S. SDR holdings and reserve position in the IMF also are valued on this basis beginning July 1974. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A56 International Statistics □ June 1980 3.13 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data Millions of dollars, end of period 1979 1980 Asset account 1976 1977 19781 Sept. Oct. Nov. Dec. Jan. Feb. Mar.P All foreign countries 1 Total, all currencies.............................. 219,420 258,897 306,795 360,817 358,320 365,587 364,166 360,373' 372,051 371,457 2 Claims on United States........................ 7,889 11,623 17,340 37,758 34,880 37,606 32,282r 31,573' 39,630 35,617 3 Parent bank........................................... 4,323 7,806 12,811 30,004 28,046 31,133 25,929' 24,788' 32,144 28,225 4 Other ..................................................... 3,566 3,817 4,529 7,754 6,834 6,473 6,353 6,785' 7,486 7,392 5 Claims on foreigners .............................. 204,486 238,848 278,135 309,004 309,652 313,409 317,130' 313,846' 317,051 319,758 6 Other branches of parent bank........ 45,955 55,772 70,338 80,106 80,126 79,076 79,661' 75,419' 78,185 80,577 7 Banks ..................................................... 83,765 91,883 103,111 117,994 119,253 122,004 123,335 125,052 124,422 126,117 8 Public borrowers2................................ 10,613 14,634 23,737 25,777 25,288 25,568 26,060 25,784 26,032 25,454 9 Nonbank foreigners ............................ 64,153 76,560 80,949 85,127 84,985 86,761 88,074 87,591 88,412 87,610 10 Other assets............................................... 7,045 8,425 11,320 14,055 13,788 14,572 14,754 14,954' 15,370 16,082 11 Total payable in U.S. dollars............... 167,695 193,764 224,940 263,630 263,094 266,544 267,645 265,157' 275,969 276,688 12 Claims on United States........................ 7,595 11,049 16,382 36,527 33,638 36,362 31,151' 30,488' 38,413 34,437 13 Parent bank........................................... 4,264 7,692 12,625 29,773 27,674 30,652 25,632' 24,516' 31,764 27,873 14 Other ..................................................... 3,332 3,357 3,757 6,754 5,964 5,710 5,519 5,972' 6,649 6,564 15 Claims on foreigners .............................. 156,896 178,896 203,498 220,665 222,543 223,201 229,074' 226,811 229,071 233,729 16 Other branches of parent bank........ 37,909 44,256 55,408 62,058 61,918 60.397 61,525' 58,084 60,217 63,434 17 Banks ..................................................... 66,331 70,786 78,686 88,882 90,911 92,730 96,183 97,877 97,193 99,452 18 Public borrowers2................................ 9,022 12,632 19,567 21,439 20,909 21,160 21,618 21,523 21,777 21,349 19 Nonbank foreigners ............................ 43,634 51,222 49,837 48,286 48,805 48,914 49,748 49,317 49,884 49,494 20 Other assets............................................... 3,204 3,820 5,060 6,438 6,913 6.981 7,420 7,858' 8,485 8,522 United Kingdom 21 Total, all currencies.............................. 81,466 90,933 106,593 126,091 127,949 131,959 130,873 128,417 133,793 136,654 22 Claims on United States........................ 3,354 4,341 5,370 10,687 11,653 11,841 11,117' 10,147 10,697 11,990 23 Parent bank.......................................... 2,376 3,518 4,448 8,395 9,643 9,892 9,338' 8,207 8,584 9,838 24 Other .................................................... 978 823 922 2,292 2,010 1,949 1,779 1,940 2,113 2,152 25 Claims on foreigners .............................. 75,859 84.016 98,137 111,598 112,450 115,656 115,123' 113,617 118,212 119,290 26 Other branches of parent bank........ 19,753 22.017 27,830 32,998 32,464 33,487 34,291' 31,995 35,187 35,536 27 Banks ..................................................... 38,089 39,899 45,013 49,938 51,466 52,580 51,343 52,177 53,127 52,509 28 Public borrowers2................................ 1,274 2,206 4,522 4,882 4,646 4,868 4,919 4,559 4,499 5,860 29 Nonbank foreigners ............................ 16,743 19,895 20,772 23,780 23,874 24,721 24,570 24,886 25,399 25,385 30 Other assets............................................... 2,253 2,576 3,086 3,806 3,846 4,462 4,633 4,653 4,884 5,374 31 Total payable in U.S. dollars................ 61,587 66,635 75,860 89,032 91,485 93,502 94,287 91,760 96,228 99,711 32 Claims on United States........................ 3,275' 4,100 5,113 10,169 11,164 11,352 10,746' 9,820 10,285 11,620 33 Parent bank........................................... 2,374 3,431 4,386 8,343 9,485 9,697 9,297' 8,161 8,467 9,778 34 Other ..................................................... 902 669 727 1,826 1,679 1,655 1,449 1,659 1,818 1,842 35 Claims on foreigners .............................. 57,488 61,408 69,416 77,145 78,428 80,127 81,294' 79,740 83,603 85,452 36 Other branches of parent bank........ 17,249 18,947 22,838 27,631 27,092 27,993 28,928' 26,842 29,907 30,204 37 Banks .................................................... 28,983 28,530 31,482 34,276 36,183 36,604 36,760 37,487 38,185 37,768 38 Public borrowers2................................ 846 1,669 3,317 3,336 3,206 3,311 3,319 3,274 3,253 4,589 39 Nonbank foreigners ............................ 10,410 12,263 11,779 11,902 11,947 12,219 12,287 12,137 12,258 12,891 40 Other assets.............................................. 824 1,126 1,331 1,718 1,893 2,023 2,247 2,200 2,340 2,639 Bahamas and Caymans 41 Total, all currencies................................ 66,774 79,052 91,735 109,925 106,484 108,872 108,910 110,946' 117,791 114,748 42 Claims on United States........................ 3,508 5,782 9,635 24,731 21,394 23,856 19,104 19,650' 27,048 21,766 43 Parent bank.......................................... 1,141 3,051 6,429 19,919 17,131 19,868 15,196 15,366' 22,366 17,298 44 Other .................................................... 2,367 2,731 3,206 4,812 4,263 3,988 3,908 4,284' 4,682 4,468 45 Claims on foreigners .............................. 62,048 71,671 79,774 82,296 82,068 81,959 86,673 87,868 86,887 89,319 46 Other branches of parent bank........ 8,144 11,120 12,904 10,834 10,514 8,854 9,689 10,242 10,265 13,659 47 Banks .................................................... 25,354 27,939 33,677 38,425 38,820 40,050 43,111 44,044 42,440 44,455 48 Public borrowers2................................ 7,105 9,109 11,514 12,757 12,355 12,658 12,893 12,895 13,108 11,309 49 Nonbank foreigners ............................ 21,445 23,503 21,679 20,280 20,379 20,397 20,980 20,687 21,074 19,896 50 Other assets.............................................. 1,217 1,599 2,326 2,898 3,022 3,057 3,133 3,438 3,856 3,663 51 Total payable in U.S. dollars................ 62,705 73,987 85,417 103,034 99,715 101,932 102,302 105,013' 111,456 108,550 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Overseas Branches A57 3.13 Continued 1979 1980 Liability account 1976 1977 19781 Sept. Oct. Nov. Dec. Jan. Feb. Mar.P All foreign countries 52 Total, all currencies.............................. 219,420 258,897 306,795 360,817 358,320 365,587 364,166 360,373 372,051 371,457 53 To United States .................................... 32,719 44,154 57,948 67,505 65,998 62,179 66,567 70,263 70,969 67,580 54 Parent bank.......................................... 19,773 24,542 28,464 21,343 21,317 19,274 24,275 24,688 22,724 22,352 5 5 6 5 N Ot o h n e b r a b n a k n s k . s .. . i . n .. .. U ... n .. i . t .. e .. d .. .. S .. t .. a .. t .. e .. s .. . . . . . . . . . . . . . . . . . . . . . . . . | 12,946 19,613 1 1 7 2 , , 1 3 4 38 6 2 1 7 8 . . 5 5 8 8 1 1 2 1 9 4 , , 9 7 6 1 8 3 2 1 9 3 , , 0 8 0 9 8 7 2 1 7 5 , , 1 1 6 2 3 9 3 1 2 3 , , 4 1 0 7 0 5 3 1 3 4 , , 3 8 5 8 9 6 3 1 2 2 , , 8 3 9 3 6 2 57 To foreigners............................................. 179,954 206,579 238,912 280,391 279,240 289,555 283,330 276,192 286,259 289,477 58 Other branches of parent bank........ 44,370 53,244 67,496 78,413 78,005 77,188 77,601 72,846 73,582 76,655 59 Banks .................................................... 83,880 94,140 97,711 117,853 116,058 128,024 122,832 122,043 130,255 129,374 60 Official institutions.............................. 25,829 28,110 31,936 36,196 35,921 34,958 35,664 33,195 34,221 34,806 61 Nonbank foreigners ............................ 25,877 31,085 41,769 47,929 49,256 49,385 47,233 48,108 48,201 48,642 62 Other liabilities........................................ 6,747 8,163 9,935 12,921 13,082 13,853 14,269 13,918 14,823 14,400 63 Total payable in U.S. dollars................ 173,071 198,572 230,810 269,811 268,769 272,166 273,752 270,597 282,156 282,648 64 To United States .................................... 31,932 42,881 55,811 64,882 63,408 59,889 64,479 67,879 68,459 65,308 65 Parent bank.......................................... 19,599 24,213 27,393 20,177 20,089 18,089 23,216 23,549 21,503 21,163 6 6 7 6 N Ot o h n e b r a b n a k n s k . s . .. i . n .. .. U ... n .. i . t .. e .. d .. . S ... t .. a .. t .. e .. s .. . . . . . . . . . . . . . . . . . . . . . . . . | 12,373 18,669 1 12 6, ,0 33 8 4 4 2 1 6 8 , , 5 1 6 4 5 0 2 1 8 4 , , 9 3 4 75 4 2 1 8 3 , , 1 6 0 9 2 8 2 1 6 4 , , 3 9 3 3 1 2 3 1 1 2 , , 4 8 8 4 5 5 3 1 2 4 , , 4 4 7 7 7 9 3 1 2 1 , , 1 9 7 75 0 68 To foreigners............................................. 137,612 151,363 169,927 197,993 198,229 204,654 201,462 195,232 205,528 209,191 69 Other branches of parent bank........ 37,098 43,268 53,396 60,656 60,413 59,429 60,513 56,779 57,714 61,196 70 Banks .................................................... 60,619 64,872 63,000 76,032 74,852 83,605 80,674 80,987 89,241 88,141 71 Official institutions.............................. 22,878 23,972 26,404 29,932 29,653 28,521 29,048 26,813 27,727 28,324 72 Nonbank foreigners ............................ 17,017 19,251 27,127 31,373 33,311 33,099 31,227 30,653 30,846 31,530 73 Other liabilities........................................ 3,527 4,328 5,072 6,936 7,132 7,623 7,811 7,486 8,169 8,149 United Kingdom 74 Total, all currencies.............................. 81,466 90,933 106,593 126,091 127,949 131,959 130,873 128,417 133,793 136,654 75 To United States .................................... 5,997 7,753 9,730 18,502 19,730 19,612 20,986 20,378 20,808 19,921 76 Parent bank........................................... 1,198 1,451 1,887 2,070 2,258 2,516 3,104 3,014 2,758 2,140 7 7 8 7 N Ot o h n e b r a b n a k nk s. s . .. i . n .. .. U ... n .. i . t .. e .. d .. . S ... t .. a .. t .. e .. s .. . . . . . . . . . . . . . . . . . . . . . . . . | 4,798 6,302 4 3 , , 2 61 3 1 2 7 8 , , 7 6 9 4 0 2 8 9 , , 0 4 0 6 4 8 7 9 , , 3 7 8 1 1 5 8 9 , ,1 71 6 5 7 7 9 , , 6 7 3 3 1 3 1 7 0 , , 6 4 2 2 7 3 1 6 1 , , 5 2 0 7 2 9 79 To foreigners............................................ 73,228 80,736 93,202 102,533 103,093 106,766 104,032 102,117 106,524 110,473 80 Other branches of parent bank........ 7,092 9,376 12,786 13,045 13,139 12,463 12,567 11,458 11,099 14,799 81 Banks ..................................................... 36,259 37,893 39,917 44,913 44,440 49,299 47,620 48,872 53,031 53,204 82 Official institutions.............................. 17,273 18,318 20,963 24,461 24,438 23,060 24,202 21,944 22,890 23,303 83 Nonbank foreigners ............................ 12,605 15,149 19,536 20,114 21,076 21,944 19,643 19,843 19,504 19,167 84 Other liabilities........................................ 2,241 2,445 3,661 5,056 5,126 5,581 5,855 5,922 6,461 6,260 85 Total payable in U.S. dollars................ 63,174 67,573 77,030 90,682 92,817 94,983 95,449 92,771 97,395 101,293 86 To United States .................................... 5,849 7,480 9,328 17,868 19,187 19,138 20,552 19,827 20,206 19,381 87 Parent bank.......................................... 1,182 1,416 1,836 1,966 2,196 2,467 3,054 2,968 2,724 2,089 8 8 8 9 N Ot o h n e b r a b n a k nk s. s . .. i . n .. .. U ... n .. i . t .. e .. d .. . S ... t .. a .. t .. e .. s .. . . . . . . . . . . . . . . . . . . . . . . . . | 4,667 6,064 4 3 , , 1 3 4 48 4 7 8 , , 7 1 1 8 5 7 7 9 , , 9 05 4 1 0 7 9 , , 3 3 3 3 8 3 8 8 , , 8 6 2 7 5 3 7 9 , , 5 2 6 9 9 0 1 7 0 , , 4 0 6 1 7 5 1 6 0 , , 3 9 5 4 1 1 90 To foreigners............................................. 56,372 58,977 66,216 70,730 71,561 73,542 72,397 70,597 74,705 79,251 91 Other branches of parent bank........ 5,874 7,505 9,635 8,663 8,955 8,337 8,446 7,793 7,322 10,894 92 Banks ..................................................... 25,527 25,608 25,287 26,851 26,132 29,424 29,424 30,988 34,694 35,300 93 Official institutions.............................. 15,423 15,482 17,091 20,703 20,457 19,139 20,192 18,117 18,923 19,255 94 Nonbank foreigners ............................ 9,547 10,382 14,203 14,513 16,017 16,642 14,335 13,699 13,766 13,802 95 Other liabilities........................................ 953 1,116 1,486 2,084 2,069 2,303 2,500 2,347 2,484 2,661 Bahamas and Caymans 96 Total, all currencies................................ 66,774 79,052 91,735 109,925 106,484 108,872 108,910 110,946r 117,791 114,748 97 To United States .................................... 22,721 32,176 39,431 40,582 38,294 34,995 37,668 43,014' 43,440 40,894 98 Parent bank........................................... 16,161 20,956 20,356 13,525 12,864 10,937 15,080 16,726' 14,966 15,310 99 Other banks in United States............ | 6,560 11,220 6,199 8,947 5,757 5,545 5,343 4,609 6,348 4,819 100 Nonbanks............................................... 12,876 18,110 19,673 18,513 17,245 21,679 22,126 20,765 101 To foreigners............................................. 42,899 45,292 50,447 67,017 65,822 71,259 68,584 65,232 71.149 70,807 102 Other branches of parent bank........ 13,801 12,816 16,094 20,730 19,206 21,078 20,875 20,559 22.150 22,401 103 Banks ..................................................... 21,760 24,717 23,104 32,799 32,266 36,498 33,614 30,503 34,704 33,750 104 Official institutions.............................. 3,573 3,000 4,208 4,418 4,712 5,176 4,866 5,020 5,016 4,958 105 Nonbank foreigners ............................ 3,765 4,759 7,041 9,070 9,638 8,507 9,229 9,150 9,279 9,698 106 Other liabilities........................................ 1,154 1,584 1,857 2,326 2,368 2,618 2,658 2,700 3,202 3,047 107 Total payable in U.S. dollars............... 63,417 74,463 87,014 104,113 100,820 103,339 103,393 105,997r 112,881 110,077 1. In May 1978 the exemption level for branches required to report was in- rowers, including corporations that are majority owned by foreign governments, creased, which reduced the number of reporting branches. replaced the previous, more narrowly defined claims on foreign official institutions. 2. In May 1978 a broader category of claims on foreign public bor- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 International Statistics □ June 1980 3.14 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1979 1980 Item 1977 1978 1979 Oct. Nov. Dec. Jan. Feb. Mar.P Apr.P 1 Total1 ............................................................................. 131,097 162,521 149,508 146,871 141,575 149,508 145,985 145,013 141,787 140,374 By type 2 Liabilities reported by banks in the United States2 18,003 23,258 30,476 25,041 26,857 30,476 24,750 24,491 27,110 27,818 3 U.S. Treasury bills and certificates3........................ 47,820 67,671 47.666 49,411 43,921 47.666 48,864 48,234 42,655 40,527 U.S. Treasury bonds and notes 4 Marketable ............................................................... 32,164 35,892 37.667 38,157 37,120 37.667 38,148 37,884 37,781 37,718 5 Nonmarketable4 ....................................................... 20,443 20,970 17,387 18,497 17,837 17,387 17,434 17,384 16,784 16,384 6 U.S. securities other than U.S. Treasury securities5 12,667 14,730 16,312 15,765 15,840 16,312 16,789 17,020 17,457 17,927 By area 7 Western Europe1 ......................................................... 70,748 93,026 85,650 85,468 80,838 85,650 82,623 79,828 77,011 74,020 8 Canada ........................................................................... 2,334 2,486 1,898 1,954 1,971 1,898 1,922 2,347 1,644 1,903 9 Latin America and Caribbean.................................. 4,649 5,046 6,371 4,558 4,579 6,371 4,780 4,916 6,099 5,978 10 Asia ............................................................................... 50,693 58,812 52,693 51,922 51,420 52,693 53,448 54,602 53,825 54,412 11 Africa ............................................................................. 1,742 2,408 2,412 2,583 2,215 2,412 2,480 2,392 2,419 3,316 12 Other countries6........................................................... 931 743 484 386 552 484 732 928 789 745 1. Includes the Bank for International Settlements. 5. Debt securities of U.S. government corporations and federally sponsored 2. Principally demand deposits, time deposits, bankers acceptances, commercial agencies, and U.S. corporate stocks and bonds. paper, negotiable time certificates of deposit, and borrowings under repurchase 6. Includes countries in Oceania and Eastern Europe. agreements. 3. Includes nonmarketable certificates of indebtedness (including those payable Note: Based on Treasury Department data and on data reported to the Treasury in foreign currencies through 1974) and Treasury bills issued to official institutions Department by banks (including Federal Reserve Banks) and securities dealers of foreign countries. in the United States. 4. Excludes notes issued to foreign official nonreserve agencies. Includes bonds and notes payable in foreign currencies. 3.15 LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in Foreign Currencies Millions of dollars, end of period 1978 1979 1980 Item 1976 1977 Dec. June Sept. Dec/ Mar. 1 Banks’ own liabilities ................................................................................. 781 925 2,235 1,931 2,312 1,824 2,289 2 Banks’ own claims1 ..................................................................................... 1,834 2,356 3,504 2,467 2,564 2,443 3,242 3 Deposits ................................................................................................... 1,103 941 1,633 1,271 1,220 1,017 1,490 4 Other claims ............................................................................................. 731 1,415 1,871 1,196 1,343 1,425 1,751 5 Claims of banks’ domestic customers2.................................................... 367 574 616 592 1,056 1. Includes claims of banks’ domestic customers through March 1978. Note: Data on claims exclude foreign currencies held by U.S. monetary au- 2. Assets owned by customers of the reporting bank located in the United States thorities. that represent claims on foreigners held by reporting banks for the accounts of their domestic customers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bank-Reported Data A59 3.16 LIABILITIES TO FOREIGNERS Reported by Banks in the United States Payable in U.S. dollars Millions of dollars, end of period 1979 1980 Holder and type of liability 1976 1977 1978 Oct. Nov. Dec. Jan. Feb. Mar. Apr.P 1 All foreigners ........................................................... 110,657 126,168 167,080 180,817 184,466 187,749 185,087 193,788" 185,513 179,687 78,987 108,034 117,282 117,561 113,791 122,479' 118,975 114,711 3 Demand deposits ..................................................... 16,803 18,996 19,211 17,914 23,338 23,367 20,810 22,550' 22,728 22,436 4 Time deposits1 ......................................................... 11,347 11,521 12,441 12,204 12,649 13,641 12,481 12,732' 12,888 12,731 5 Other2 ....................................................................... 9,713 12,890 12,723 16,268 12,703 12,461' 14,564 14,692 37,622 65,026 68,572 64,286 67,797 74,735' 68,795 64,852 7 Banks’ custody liabilities4.......................................... 88,093 72,783 67,184 70,187 71,296 71,309 66,538 64,976 8 U.S. Treasury bills and certificates5.................... 40,744 48,906 68,202 50,452 45,005 48,573 49,855 49,360 44,265 42,232 9 Other negotiable and readily transferable instruments6 ..................................................... 17,396 20,141 19,802 19,270 18,931 19,407 19,602 19,964 2,495 2,190 2,376 2,344 2,509 2,542 2,671 2,780 11 Nonmonetary international and regional organizations7 ................................................... 5,714 3,274 2,607 2,389 2,717 2,352 1,227 1,712 1,758 2,051 906 566 753 710 444 393 383 738 13 Demand deposits ..................................................... 290 231 330 143 214 260 164 153 160 241 14 Time deposits1 ......................................................... 205 139 84 82 80 152 89 78 79 87 15 Other2 ....................................................................... 492 342 459 298 191 162 144 410 1,701 1,823 1,964 1,643 783 1,319 1,376 1,313 17 U.S. Treasury bills and certificates ...................... 2,701 706 201 327 258 102 102 114 157 87 18 Other negotiable and readily transferable 1,499 1,494 1,605 1,538 681 1,206 1,218 1,226 19 Other ......................................................................... 1 2 101 2 0 0 0 0 20 Official institutions8 ................................................. 54,956 65,822 90,674 74,452 70,779 78,143 73,614 72,725' 69,766 68,344 21 Banks’ own liabilities ................................................ 12,097 12,070 14,390 18,229 12,358 12,151' 14,508 14,435 22 Demand deposits .................................................... 3,394 3,528 3,390 2,374 5,652 4,724 3,745 3,680' 3,927 4,745 23 Time deposits1 ......................................................... 2,321 1,797 2,550 1,883 1,972 3,071 2,289 2,367' 2,397 2,376 24 Other2 ....................................................................... 6,157 7,813 6,767 10,434 6,324 6,104' 8,183 7,314 25 Banks’ custody liabilities4........................................... 78,577 62,381 56,388 59,914 61,256 60,575 55,258 53,910 26 U.S. Treasury bills and certificates5.................... 37,725 47,820 67,415 49,411 43,921 47,666 48,864 48,234 42,655 40,527 27 Other negotiable and readily transferable instruments6 ..................................................... 10,992 12,913 12,411 12,196 12,357 12,303 12,571 13,348 28 Other ......................................................................... 170 57 56 52 35 37 32 35 29 Banks9 ...................................................................... 37,174 42,335 57,779 86,236 92,716 88,694 91,628 100,209' 94,908 91,105 30 Banks’ own liabilities ................................................ 52,994 81,135 87,511 83,699 86,246 94,734' 89,209 85,249 31 Unaffiliated foreign banks .................................... 15,372 16,110 18,939 19,413 18,449 19,999' 20,414 20,397 32 Demand deposits ................................................ 9,104 10,933 11,249 10,620 12,879 13,262 11,822 13,345' 13,374 12,739 33 Time deposits1 ..................................................... 2,297 2,040 1,453 1,478 1,606 1,663 1,275 1,295 1,584 1,563 34 Other2 ................................................................... 2,670 4,011 4,454 4,488 5,353 5,359 5,456 6,096 35 Own foreign offices3 .............................................. 37,622 65,026 68,572 64,286 67,797 74,735' 68,795 64,852 36 Banks’ custody liabilities4.......................................... 4,785 5,100 5,205 4,995 5,382 5,475 5,699 5,856 37 U.S. Treasury and certificates.............................. 119 141 300 400 451 422 533 566 675 771 38 Other negotiable and readily transferable instruments6 ..................................................... 2,425 2,684 2,611 2,405 2,573 2,559 2,556 2,462 39 Other ......................................................................... 2,060 2,017 2,143 2,168 2,276 2,350 2,468 2,624 40 Other foreigners ....................................................... 12,814 14,736 16,020 17,741 18,254 18,560 18,617 19,141' 19,081 18,186 41 Banks’ own liabilities ................................................ 12,990 14,262 14,627 14,924 14,743 15,201' 14 875 14,289 42 Demand deposits ..................................................... 4,015 4,304 4,242 4,778 4,594 5,121 5,079 5,373' 5,267 4,711 43 Time deposits ........................................................... 6,524 7,546 8,353 8,760 8,991 8,755 8,828 8,992' 8,827 8,705 44 Other2 ....................................................................... 394 724 1,043 1,048 835 836' 781 873 45 Banks’ custody liabilities4.......................................... 3,030 3,479 3,626 3,636 3,875 3,939 4,205 3,897 46 U.S. Treasury bills and certificates...................... 198 240 285 315 375 382 356 446 778 847 47 Other negotiable and readily transferable instruments6 ..................................................... 2,481 3,050 3,175 3,131 3,320 3,339 3,256 2,928 48 Other ......................................................................... 264 114 76 123 199 154 171 122 49 Memo: Negotiable time certificates of deposit in custody for foreigners.................................... 11,007 11,346 10,821 10,974 10,906 11,395 11,220 11,723 1. Excludes negotiable time certificates of deposit, which are included in “Other 5. Includes nonmarketable certificates of indebtedness and Treasury bills issued negotiable and readily transferable instruments.” Data for time deposits prior to to official institutions of foreign countries. April 1978 represent short-term only. 6. Principally bankers acceptances, commercial paper, and negotiable time cer­ 2. Includes borrowing under repurchase agreements. tificates of deposit. 3. U.S. banks: includes amounts due to own foreign branches and foreign sub­ 7. Principally the International Bank for Reconstruction and Development, and sidiaries consolidated in “Consolidated Report of Condition” filed with bank reg­ the Inter-American and Asian Development Banks. ulatory agencies. Agencies, branches, and majority-owned subsidiaries of foreign 8. Foreign central banks and foreign central governments and the Bank for banks: principally amounts due to head office or parent foreign bank, and foreign International Settlements. branches, agencies or wholly owned subsidiaries of head office or parent foreign 9. Excludes central banks, which are included in “Official institutions.” bank. 4. Financial claims on residents of the United States, other than long-term securities, held by or through reporting banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A60 International Statistics □ June 1980 3.16 LIABILITIES TO FOREIGNERS Continued 1979 1980 Area and country 1976 1977 1978 Oct. Nov. Dec. Jan. Feb. Mar. Apr.P 1 Total .......................................................................... 110,657 126,168 167,080 180,817 184,466 187,749 185,087 193,788' 185,513 179,687 2 Foreign countries ..................................................... 104,943 122,893 164,473 178,428 181,748 185,396 183,860 192,075' 183,755 177,636 3 Europe ........................................................................... 47,076 60,295 85,447 88,008 87,488 91,411 87,294 85,747' 85,134 81,746 4 Austria ....................................................................... 346 318 513 426 404 413 378 379' 335 444 5 Belgium-Luxembourg ............................................ 2,187 2,531 2,552 2,710 2,786 2,364 2,108 2,406' 2,364 2,369 6 Denmark ................................................................... 356 770 1,946 1,001 1,166 1,092 955 587 611 615 7 Finland....................................................................... 416 323 346 334 390 398 455 544 482 522 8 France ....................................................................... 4,876 5,269 9,208 9,340 10,301 10,401 10,534 11,247 11,004 11,303 9 Germany ................................................................... 6,241 7,239 17,286 13,154 10,801 12,935 10,345 8,960 8,619 5,340 10 Greece ....................................................................... 403 603 826 632 792 635 832 627 627 617 11 Italy ........................................................................... 3,182 6,857 7,739 8,481 8,345 7,782 7,825 7,394 7,385 7,434 12 Netherlands ............................................................... 3,003 2,869 2,402 2,174 2,165 2,327 2,529 2,485' 2,377 2,030 13 Norway ..................................................................... 782 944 1,271 1,393 1,407 1,267 1,229 1,156' 1,500 1,385 14 Portugal ..................................................................... 239 273 330 620 595 557 550 438 314 537 15 Spain ......................................................................... 559 619 870 1,103 1,184 1,259 1,192 1,146 1,242 1,418 16 Sweden....................................................................... 1,692 2,712 3,121 2,165 2,064 2,005 1,845 1,978 1,663 1,842 17 Switzerland ............................................................... 9,460 12,343 18,560 16,643 17,206 18,501 17,311 16,947' 15,542 15,150 18 Turkey ....................................................................... 166 130 157 150 145 120 232 118 138 136 19 United Kingdom....................................................... 10,018 14,125 14,265 24,138 24,043 24,665 25,081 25,298 26,803 26,019 20 Yugoslavia ................................................................. 189 232 254 147 147 266 157 149 115 122 21 Other Western Europe1 ........................................ 2,673 1,804 3,393 3,087 3,248 4,070 3,474 3,455 3,668 4,096 22 U.S.S.R....................................................................... 51 98 82 53 39 52 46 41 42 33 23 Other Eastern Europe2.......................................... 236 236 325 259 261 302 217 390 301 334 24 Canada ........................................................................... 4,659 4,607 6,969 8,644 7,280 7,379 9,541 9,556 8,507 8,048 25 Latin America and Caribbean.................................. 19,132 23,670 31,606 47,182 51,624 49,565 50,537 57,728' 51,448 48,979 26 Argentina ................................................................. 1,534 1,416 1,484 1,705 1,573 1,582 1,635 1,632' 1,574 1,679 27 Bahamas ................................................................... 2,770 3,596 6,752 15,377 18,540 15,311 16,322 22,085' 16,203 14,456 28 Bermuda ................................................................... 218 321 428 399 404 430 447 560 534 479 29 Brazil ......................................................................... 1,438 1,396 1,125 994 1,051 1,005 1,405 1,156 1,367 1,645 30 British West Indies ................................................. 1,877 3,998 5,991 11,445 12,534 11,049 11,908 12,956 11,843 11,546 31 Chile ........................................................................... 337 360 399 425 356 469 396 471 445 444 32 Colombia ................................................................... 1,021 1,221 1,756 2,243 2,377 2,617 2,882 2,840 2,825 2,905 33 Cuba........................................................................... 6 6 13 7 12 13 10 5 6 23 34 Ecuador ..................................................................... 320 330 322 482 476 425 386 412 459 357 35 Guatemala3 ............................................................... 416 361 374 414 394 391 426 403 36 Jamaica3..................................................................... 52 113 74 76 96 90 97 132 37 Mexico ....................................................................... 2,870 2,876 3,417 3,528 3,666 4,096 3,980 3,973 4,000 4,302 38 Netherlands Antilles ............................................... 158 196 308 609 460 499 344 524 420 411 39 Panama ..................................................................... 1,167 2,331 2,968 3,926 4,290 4,483 4,770 4,646 4,425 4,572 40 Peru ........................................................................... 257 287 363 388 417 383 376 388 363 392 41 Uruguay ..................................................................... 245 243 231 217 185 202 216 210 240 216 42 Venezuela ................................................................. 3,118 2,929 3,821 3,168 3,014 4,192 3,083 3,518' 4,058 3,179 43 Other Latin America and Carribbean................ 1,797 2,167 1,760 1,795 1,822 2,318 1,886 1,872 2,161 1,837 44 Asia ............................................................................... 29,766 30,488 36,487 30,691 31,272 32,898 32,043 34,511 34,039 33,526 China 45 Mainland ............................................................... 48 53 67 49 45 49 46 32 34 35 46 Taiwan ................................................................... 990 1,013 502 1,339 1,413 1,393 1,386 1,567 1,188 1,075 47 Hong Kong ............................................................... 894 1,094 1,256 1,542 1,624 1,672 1,694 1,776 1,898 1,857 48 India ........................................................................... 638 961 790 496 580 527 544 579 558 576 49 Indonesia .................................................................. 340 410 449 555 478 504 743 693 658 2,035 50 Israel ......................................................................... 392 559 688 621 574 707 517 501' 759 569 51 Japan ......................................................................... 14,363 14,616 21,927 10,885 7,867 8,886 9,429 10,664' 9,646 9,374 52 Korea ......................................................................... 438 602 795 950 951 993 959 1,019' 1,068 1,008 53 Philippines ................................................................. 628 687 644 598 671 800 729 772 669 796 54 Thailand..................................................................... 277 264 427 304 415 281 408 284 415 407 55 Middle-East oil-exporting countries4 .................. 9,360 8,979 7,529 11,388 14,788 15,212 14,081 14,992' 15,512 14,088 56 Other Asia ............................................................... 1,398 1,250 1,414 1,963 1,876 1,871 1,506 1,631 1,633 1,704 57 Africa ............................................................................ 2,298 2,535 2,886 3,141 3,105 3,239 3,330 3,170 3,326 4,203 58 Egypt ........................................................................ 333 404 404 294 380 475 449 332 318 438 59 Morocco.................................................................... 87 66 32 30 36 33 50 33 31 41 60 South Africa ............................................................ 141 174 168 194 213 184 268 195 314 294 61 Zaire.......................................................................... 36 39 43 112 104 110 128 93 102 84 62 Oil-exporting countries5 ........................................ 1,116 1,155 1,525 1,711 1,513 1,635 1,503 1,665 1,660 2,462 63 Other Africa ............................................................ 585 698 715 800 859 804 932 852 901 885 64 Other countries .......................................................... 2,012 1,297 1,076 762 980 904 1,114 1,363 1,301 1,133 65 Australia .................................................................. 1,905 1,140 838 528 714 684 853 1,054 989 881 66 All other .................................................................. 107 158 239 234 266 220 261 309 312 252 67 Nonmonetary international and regional organizations ......................................................... 5,714 3,274 2,607 2,389 2,717 2,352 1,227 1,712 1,758 2,051 68 International ............................................................. 5,157 2,752 1,485 1,343 1,504 1,232 823 618' 652 953 69 Latin American regional........................................ 267 278 808 755 790 813 90 780' 746 813 70 Other regional6........................................................ 290 245 314 291 423 308 314 315 361 285 1. Includes the Bank for International Settlements. Beginning April 1978, also 4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and includes Eastern European countries not listed in line 23. United Arab Emirates (Trucial States). 2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German Dem­ 5. Comprises Algeria, Gabon, Libya, and Nigeria. ocratic Republic, Hungary, Poland, and Romania. 6. Asian, African, Middle Eastern, and European regional organizations, except 3. Included in “Other Latin America and Caribbean” through March 1978. the Bank for International Settlements, which is included in “Other Western Europe." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bank-Reported Data A61 3.17 BANKS’ OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1979 1980 Area and country 1976 1977 1978 Oct. Nov. Dec. Jan. Feb. Mar. Apr.P 1 Total ............................................................................... 79,301 90,206 115,610 121,249 124,466 133,586 127,290 130,766" 130,872 133,252 2 Foreign countries ......................................................... 79,261 90,163 115,554 121,213 124,422 133,554 127,254 130,733" 130,836 133,219 3 Europe ........................................................................... 14,776 18,114 24,202 26,196 25,890 28,314 24,821 25,575" 25,689 24,539 4 Austria ....................................................................... 63 65 140 190 168 284 258 315 331 355 5 Belgium-Luxembourg ............................................ 482 561 1,175 1,559 1,402 1,328 1,416 1,524 1,631 1,574 6 Denmark ................................................................... 133 173 254 116 149 147 126 156 202 203 7 Finland....................................................................... 199 172 305 230 182 202 262 237 186 223 8 France ....................................................................... 1,549 2,082 3,735 2,738 3,305 3,302 3,086 3,197 2,979 2,811 9 Germany ................................................................... 509 644 845 1,316 1,396 1,159 921 1,209 1,308 1,154 10 Greece ....................................................................... 279 206 164 282 171 154 136 141 191 244 11 Italy ........................................................................... 993 1,334 1,523 1,424 1,259 1,572 1,345 1,405 1,488 1,464 12 Netherlands ............................................................... 315 338 677 618 603 514 472 610 535 481 13 Norway ..................................................................... 136 162 299 236 257 276 177 175 243 170 14 Portugal ..................................................................... 88 175 171 349 352 330 288 213 227 247 15 Spain ......................................................................... 745 722 1,115 1,117 1,050 1,051 948 1,015 907 1,020 16 Sweden....................................................................... 206 218 537 603 548 542 747 702 587 618 17 Switzerland ............................................................... 379 564 1,283 1,171 1,232 1,162 935 1,359 1,356 827 18 Turkey ....................................................................... 249 360 300 162 151 149 128 131 123 132 19 United Kingdom....................................................... 7,033 8,964 10,172 11,839 11,426 13,789 11,334 10,877" 10,869 10,469 20 Yugoslavia................................................................. 234 311 363 578 582 611 569 565 594 593 21 Other Western Europe1 ........................................ 85 86 122 154 185 175 203 227 225 330 22 U.S.S.R....................................................................... 485 413 366 349 311 290 263 265 253 257 23 Other Eastern Europe2.......................................... 613 566 657 1,163 1,160 1,277 1,205 1,251 1,453 1,366 24 Canada ........................................................................... 3,319 3,355 5,152 4,332 4,365 4,347 4,221 4,142" 4,186 3,926 25 Latin America and Caribbean.................................. 38,879 45,850 57,374 59,359 62,328 67,632 65,166 65,947" 65,095 68,157 26 Argentina ................................................................. 1,192 1,478 2,281 3,656 4,157 4,415 4,683 4,899 4,969 4,991 27 Bahamas ................................................................... 15,464 19,858 21,420 17,485 16,046 18,681 20,443 19,005" 18,992 20,455 28 Bermuda ................................................................... 150 232 184 485 462 496 434 314 313 901 29 Brazil ......................................................................... 4,901 4,629 6,251 7,567 7,497 7,767 7,555 7,618" 8,124 8,112 30 British West Indies ................................................. 5,082 6,481 9,692 6,754 9,149 9,762 7,816 10,136 7,364 8,464 31 Chile ........................................................................... 597 675 972 1,396 1,349 1,438 1,376 1,430 1,367 1,326 32 Colombia ................................................................... 675 671 1,012 1,456 1,523 1,614 1,655 1,698" 1,526 1,539 33 Cuba........................................................................... 13 10 * 4 4 4 4 4 4 5 34 Ecuador ..................................................................... 375 517 705 1,000 1,007 1,025 1,001 1,025 1,023 1,011 35 Guatemala3 ............................................................... 94 110 115 134 114 105 109 108 36 Jamaica3..................................................................... 40 29 34 47 51 44 42 43 37 Mexico ....................................................................... 4,822 4,909 5,430 8,438 8,360 8,971 8,829 8,928" 9,231 9,191 38 Netherlands Antilles ............................................... 140 224 273 230 227 248 325 397 513 663 39 Panama ..................................................................... 1,372 1,410 3,089 4,268 5,774 5,986 4,432 3,919" 4,754 4,667 40 Peru ........................................................................... 933 962 918 607 604 652 585 634 699 654 41 Uruguay ..................................................................... 42 80 52 72 71 105 100 82" 90 84 42 Venezuela ................................................................. 1,828 2,318 3,474 4,349 4,392 4,689 4,244 4,194 4,457 4,232 43 Other Latin America and Caribbean.................. 1,293 1,394 1,487 1,455 1,557 1,598 1,518 1,515 1,520 1,711 44 Asia ............................................................................... 19,204 19,236 25,616 28,463 29,057 30,624 30,169 32,337" 33,105 33,916 China 45 Mainland ............................................................... 3 10 4 55 31 35 28 51 49 48 46 Taiwan ................................................................... 1,344 1,719 1,499 1,930 1,805 1,821 1,700 1,691 1,522 1,619 47 Hong Kong ............................................................... 316 543 1,679 1,737 1,794 1,804 1,804 2,127 1,887 2,001 48 India ........................................................................... 69 53 54 68 69 92 136 90 120 87 49 Indonesia ................................................................... 218 232 143 147 135 131 117 128 132 166 50 Israel ......................................................................... 755 584 888 891 842 990 812 787 734 829 51 Japan ......................................................................... 11,040 9,839 12,681 14,989 16,155 16,925 17,027 18,899" 19,735 20,333 52 Korea ......................................................................... 1,978 2,336 2,282 3,839 3,732 3,796 4,080 4,356" 4,713 4,853 53 Philippines ................................................................. 719 594 680 724 642 737 649 645 693 693 54 Thailand..................................................................... 442 633 758 956 972 935 971 993 875 857 55 Middle East oil-exporting countries4 .................. 1,459 1,746 3,145 1,190 1,107 1,544 1,397 1,211 1,437 1,179 56 Other Asia ............................................................... 863 947 1,804 1,939 1,776 1,813 1,448 1,359 1,209 1,251 57 Africa ............................................................................. 2,311 2,518 2,221 1,926 1,865 1,785 1,899 1,775 1,728 1,800 58 Egypt ......................................................................... 126 119 107 122 91 112 130 154 128 135 59 Morocco .................................................................... 27 43 82 66 73 103 106 109 118 128 60 South Africa ............................................................. 957 1,066 860 602 565 445 412 342 336 362 61 Zaire........................................................................... 112 98 164 135 135 142 146 144 143 144 62 Oil-exporting countries5 ........................................ 524 510 452 435 442 391 507 451" 353 456 63 Other ......................................................................... 565 682 556 566 559 592 599 574 649 576 64 Other countries ........................................................... 772 1,090 988 935 916 853 978 958" 1,032 880 65 Australia ................................................................... 597 905 877 756 741 673 803 789 800 713 66 All other ................................................................... 175 186 111 180 176 180 175 170 232 167 67 Nonmonetary international and regional organizations6 ....................................................... 40 43 56 36 44 32 35 33 36 33 1. Includes the Bank for International Settlements. Beginning April 1978, also 5. Comprises Algeria, Gabon, Libya, and Nigeria. includes Eastern European countries not listed in line 23. 6. Excludes the Bank for International Settlements, which is included in “Other 2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German Dem­ Western Europe.” ocratic Republic, Hungary, Poland, and Romania. 3. Included in “Other Latin America and Caribbean” through March 1978. Note. Data for period prior to April 1978 include claims of banks’ domestic 4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and customers on foreigners. United Arab Emirates (Trucial States). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 International Statistics □ June 1980 3.18 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 1979 1980 Type of claim Dec. Jan. Feb/ Mar. Apr. 1 Total .......................................................................... 126,829 153,534 153,249 2 Banks’ own claims on foreigners.......................... 115,610 121,249 124,466 133,586 127,290 130,766 130,872 133,252 3 Foreign public borrowers ...................................... 10,168 14,246 13,753 15,054 14,862 15,052 15,541 15,135 4 Own foreign offices1 ............................................... 41,697 38,280 43,646 47,056 46,075 46,801 45,487 46,063 5 Unaffiliated foreign banks .................................... 40,467 39,781 37,831 40,902 36,140 38,902 39,782 41,058 6 Deposits ................................................................. 5,456 6,532 5,509 6,217 4,985 5,125 5,509 6,098 7 Other ..................................................................... 35,011 33,249 32,322 34,685 31,155 33,778 34,274 34,960 8 All other foreigners................................................. 23,278 28,943 29,236 30,574 30,214 30,011 30,061 30,996 9 Claims of banks’ domestic customers2................ 11,219 19,948 22,377 10 Deposits..................................................................... 480 955 1,215 11 Negotiable and readily transferable instruments3 5,385 12,974 14,559 12 Outstanding collections and other claims4.......... 5,756 5,353 6,019 6,603 13 Memo: Customer liability on acceptances.......... 14,919 21,170' 19,993 Dollar deposits in banks abroad, reported by non­ banking business enterprises in the United States5 ................................................................... 23,282 22,069 21,259 23,873 25,426 23,553 1. U.S. banks: includes amounts due from own foreign branches and foreign 4. Data for March 1978 and for period prior to that are outstanding collections subsidiaries consolidated in “Consolidated Report of Condition” filed with bank only. regulatory agencies. Agencies, branches, and majority-owned subsidiaries of foreign 5. Includes demand and time deposits and negotiable and nonnegotiable certif­ banks: principally amounts due from head office or parent foreign bank, and icates of deposit denominated in U.S. dollars issued by banks abroad. For de­ foreign branches, agencies, or wholly owned subsidiaries of head office or parent scription of changes in data reported by nonbanks, see July 1979 Bulletin, p. 550. foreign bank. 2. Assets owned by customers of the reporting bank located in the United States Note: Beginning April 1978, data for banks’ own claims are given on a monthly that represent claims on foreigners held by reporting banks for the account of their basis, but the data for claims of banks’ own domestic customers are available on domestic customers. a quarterly basis only. 3. Principally negotiable time certificates of deposit and bankers acceptances. 3.19 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 1980 Maturity; by borrower and area Sept. Dec. Mar. June Sept. Dec/ Mar.P 1 Total........................................................................................................... 60,091 73,696 71,566 77,662 87,477 86,268 84,832 By borrower 2 Maturity of 1 year or less1 ..................................................................... 47,226 58,418 55,387 60,012 68,311 65,134 63,496 3 Foreign public borrowers ................................................................... 3,711 4,583 4,627 4,604 6,057 6,991 6,953 4 All other foreigners............................................................................. 43,515 53,835 50,760 55,408 62,254 58,143 56,543 5 Maturity of over 1 year1 ......................................................................... 12,866 15,278 16,179 17,650 19,166 21,134 21,335 6 Foreign public borrowers................................................................... 4,235 5,338 5,940 6,411 7,638 8,085 8,418 7 All other foreigners............................................................................. 8,631 9,939 10,239 11,239 11,528 13,049 12,917 By area Maturity of 1 year or less1 8 Europe ................................................................................................... 10,513 15,169 12,389 14,019 16,786 15,208 13,805 9 Canada ................................................................................................... 1,953 2,670 2,514 2,703 2,471 1,846 1,810 10 Latin America and Caribbean........................................................... 18,624 20.934 21,660 23,096 25,612 24,851 23,011 11 Asia ....................................................................................................... 14,010 17,579 16,992 18,191 21,519 21,658 23,200 12 Africa..................................................................................................... 1,535 1,496 1,290 1,438 1,399 1,078 1,043 13 All other2 ............................................................................................. 591 569 541 565 524 493 627 Maturity of over 1 year1 14 Europe ................................................................................................... 3,102 3,142 3,103 3,486 3,660 4,134 4,245 15 Canada ................................................................................................... 794 1,426 1,456 1,221 1,364 1,453 1,214 16 Latin America and Caribbean........................................................... 6,877 8,452 9,325 10,265 11,757 12,796 13,381 17 Asia ....................................................................................................... 1,303 1,407 1,486 1,881 1,574 1,930 1,723 18 Africa..................................................................................................... 580 637 629 614 623 652 620 19 All other2 ............................................................................................. 211 214 180 183 188 169 152 1. Remaining time to maturity. 2. Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bank-Reported Data A63 3.20 CLAIMS ON FOREIGN COUNTRIES Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks^ Billions of dollars, end of period 1978 1979 1980 Area or Country 1976 1977 Mar. June2 Sept. Dec. Mar. June Sept. Dec. Mar./7 1 Total....................................................................................................... 206.8 240.0' 244.7 247.1 247.6 266.4' 263.8 275.5' 293.8' 303.6' 307.7 2 G-10 countries and Switzerland ...................................................... 100.3 116.4 116.9 112.6' 113.5' 124.8' 119.0' 125.3 135.8 138.1' 140.5 3 Belgium-Luxembourg ..................................................................... 6.1 8.4 8.3 8.3 8.4 9.0 9.4 9.7 10.7 11.1 10.8 4 France ............................................................................................... 10.0 11.0 11.4 11.4 11.7 12.2 11.7 12.7 12.0 11.6 12.0 5 Germany ........................................................................................... 8.7 9.6 9.0 9.1 9.7 11.3' 10.5 10.8 12.8' 12.2' 11.4 6 Italy ................................................................................................... 5.8 6.5 6.0 6.4 6.1 6.7' 5.7 6.1 6.1 6.3 6.2 7 Netherlands....................................................................................... 2.8 3.5 3.4 3.4 3.5 4.4 3.9 4.0 4.7 4.8 4.3 8 Sweden ............................................................................................. 1.2 1.9 2.0 2.1 2.2 2.1 2.0 2.0 2.3 2.4 2.4 9 Switzerland ....................................................................................... 3.0 3.6 4.0 4.1 4.3 5.4 4.5 4.8 5.0 4.8 4.4 10 United Kingdom ............................................................................. 41.7 46.5 46.7 44.9' 44.2' 47.3 46.4' 50.3' 53.7' 56.0' 57.4 11 Canada ............................................................................................... 5.1 6.4 7.0 5.1 4.9' 6.0 5.9 5.5 6.0 6.5' 6.8 12 Japan ................................................................................................. 15.9 18.8 19.1 17.9 18.5' 20.6 19.0 19.6' 22.4' 22.4 25.0 13 Other developed countries................................................................. 15.0 18.6 19.7 19.4 18.6 19.4 18.2 18.2 19.7 19.9 18.8 14 Austria............................................................................................... 1.2 1.3 1.5 1.5 1.5 1.7 1.7 1.8 2.0 2.0 1.7 15 Denmark ........................................................................................... 1.0 1.6 1.8 1.7 1.9 2.0 2.0 1.9 2.0 2.2 2.2 16 Finland............................................................................................... 1.1 1.2 1.2 1.1 1.0 1.2 1.2 1.1 1.2 1.2 1.1 17 Greece ............................................................................................... 1.7 2.2 2.1 2.3 2.2 2.3 2.3 2.2 2.3 2.4 2.4 18 Norway ............................................................................................. 1.5 1.9 1.9 2.1 2.1 2.1 2.1 2.1 2.3 2.3 2.4 19 Portugal ............................................................................................. .4 .6 .7 .6 .5 .6 .6 .5 .7 .7 .6 20 Spain ................................................................................................. 2.8 3.6 3.6 3.6 3.5 3.4 3.0 3.0 3.3 3.5 3.5 21 Turkey ............................................................................................... 1.3 1.5 1.4 1.4 1.5 1.5 1.4 1.4 1.4 1.4 1.4 22 Other Western Europe................................................................... .7 .9 1.5 1.2 .9 1.3 1.1 .9' 1.3' 1.4 1.4 23 South Africa..................................................................................... 2.2 2.4 2.5 2.4 2.2 2.0 1.7 1.8 1.7 1.3 1.1 24 Australia ........................................................................................... 1.2 1.4 1.5 1.4 1.3 1.4 1.3 1.4 1.3 1.3 1.1 25 Oil-exporting countries3 ..................................................................... 12.6 17.6 19.2 19.2 20.4 22.7 22.6 22.7 23.4 22.9' 21.9 26 Ecuador ............................................................................................. .7 1.1 1.3 1.4 1.6 1.6 1.5 1.6 1.6 1.7 1.8 27 Venezuela ......................................................................................... 4.1 5.5 5.5 5.6 6.2 7.2 7.2 7.6 7.9 8.7 7.9 28 Indonesia........................................................................................... 2.2 2.2 2.1 1.9 1.9 2.0 1.9 1.9 1.9 1.9 1.9 29 Middle East countries..................................................................... 4.2 6.9 8.3 8.4 8.7 9.5 9.4 9.0 9.2 8.0 7.8 30 African countries ............................................................................. 1.4 1.9 2.0 1.9 2.0 2.5 2.6 2.6 2.8 2.6 2.5 31 Non-oil developing countries............................................................. 44.2 48.7 49.7 49.1 49.6 52.5 53.8 55.8' 58.7' 62.7' 64.0 Latin America 32 Argentina ......................................................................................... 1.9 2.9 3.0 3.0 2.9 3.0 3.1 3.5 4.1 5.1 5.6 33 Brazil ................................................................................................. 11.1 12.7 13.0 13.3 14.0 14.9 14.9 15.1 15.1 15.3 15.1 34 Chile................................................................................................... .8 .9 1.1 1.3 1.3 1.6 1.7 1.8 2.2 2.5 2.5 35 Colombia........................................................................................... 1.3 1.3 1.2 1.3 1.3 1.4 1.5 1.5 1.7 2.2 2.2 36 Mexico ............................................................................................... 11.7 11.9 11.2 11.0 10.7 10.7' 10.9 10.7' 11.3' 11.9' 12.2 37 Peru ................................................................................................... 1.8 1.9 1.7 1.8 1.8 1.7 1.6 1.4 1.4 1.5 1.2 38 Other Latin America ..................................................................... 2.8 2.6 3.4 3.3 3.4 3.6 3.5 3.3 3.6 3.7 3.7 Asia China 39 Mainland ....................................................................................... .0 .0 .0 .0 .0 .0 .1 .1 .1 .1 .1 40 Taiwan ........................................................................................... 2.4 3.1 3.1 2.5 2.4 2.9 3.1 3.3 3.5 3.4' 3.6 41 India................................................................................................... .2 .3 .3 .2 .3 .2 .2 .2 .2 .2 .2 42 Israel ................................................................................................. 1.0 .9 .8 .7 .7 1.0 1.0 .9 1.0 1.3 .9 43 Korea (South) ................................................................................. 3.1 3.9 3.6 3.6 3.5 3.9 4.2 5.0 5.3 5.5 6.4 44 Malaysia4 ........................................................................................... .5 .7 .7 .6 .6 .6 .6 .7 .7 .9 .8 45 Philippines......................................................................................... 2.2 2.5 2.6 2.7 2.8 2.8 3.2 3.7 3.7 4.2' 4.4 46 Thailand ........................................................................................... .7 1.1 1.1 1.1 1.1 1.2 1.2 1.4 1.6 1.6 1.4 47 Other Asia ....................................................................................... .5 .4 .4 .3 .3 .2 .3 .4 .3 .4 .4 Africa 48 Egypt ................................................................................................. .4 .3 .3 .3 .4 .4 .5 .7 .6 .6 .7 49 Morocco ........................................................................................... .3 .5 .4 .5 .5 .6 .6 .5 .5 .6 .5 50 Zaire ................................................................................................. .2 .3 .3 .2 .2 .2 .2 .2 .2 .2 .2 51 Other Africa5 ................................................................................... 1.2 .7 1.4 1.2 1.3 1.4 1.4 1.5 1.6 1.7 1.8 52 Eastern Europe ................................................................................... 5.2 6.3 6.3 6.4 6.6 6.9 6.7 6.7 7.2 7.6' 7.3 53 U.S.S.R............................................................................................... 1.5 1.6 1.4 1.4 1.4 1.3 1.1 .9 .9 1.0 .6 54 Yugoslavia......................................................................................... .8 1.1 1.2 1.3 1.3 1.5 1.6 1.7 1.8 1.8 1.9 55 Other ................................................................................................. 2.9 3.7 3.7 3.7 3.9 4.1 4.0 4.1 4.6 4.8' 4.9 56 Offshore banking centers................................................................... 24.7 26.1 28.8 32.4' 30.2' 31.1' 33.7' 36.9' 38.5' 40.4' 42.2 57 Bahamas ........................................................................................... 10.1 9.8 11.3 12.1' 11.6' 10.3' 12.1' 14.3' 12.9' 13.5 13.6 58 Bermuda ........................................................................................... .5 .6 .6 .7 .7 .7 .6 .7 .7 .8' .6 59 Cayman Islands and other British West Indies........................ 3.8 3.8 4.6 7.2' 6.8' 7.4' 7.2' 7.5' 9.5' 9.5 11.2 60 Netherlands Antilles ....................................................................... .6 .7 .7 .6 .6 .8 .8 1.0 1.1 1.2 .9 61 Panama6 ........................................................................................... 3.0 3.1 3.1 3.3 3.1 3.0 3.4 3.8' 3.4' 4.3' 4.9 62 Lebanon ........................................................................................... .1 .2 .2 .1 .1 .1 .1 .1 .2 .2 .2 63 Hong Kong....................................................................................... 2.2 3.7 4.1 4.1 4.0 4.4' 4.8 4.9 5.5 6.0 5.7 64 Singapore ......................................................................................... 4.4 3.7 3.9 3.8 2.9 3.9 4.2 4.2 4.9 4.5 4.7 65 Others7 ............................................................................................. .0 .5 .3 .5 .5 .5 .4 .4 .4 .4 .4 66 Miscellaneous and unallocated8........................................................ 5.0 5.3 5.9 8.1 8.6 9.1 9.5 9.9 10.6 11.7' 13.1 1. The banking offices covered by these data are the U.S. offices and foreign in this table include only banks’ own claims payable in dollars. For earlier dates branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks. the claims of the U.S. offices also include customer claims and foreign currency Offices not covered include (1) U.S. agencies and branches of foreign banks, and claims (amounting in June 1978 to $10 billion). (2) foreign subsidiaries of U.S. banks. To minimize duplication, the data are 3. Includes Algeria, Bahrain, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Oman, adjusted to exclude the claims on foreign branches held by a U.S. office or another Qatar, Saudi Arabia, and United Arab Emirates in addition to countries shown foreign branch of the same banking institution. The data in this table combine individually. foreign branch claims in table 3.13 (the sum of lines 7 through 10) with the claims 4. Foreign branch claims only through December 1976. of U.S. offices in table 3.17 (excluding those held by agencies and branches of 5. Excludes Liberia. foreign banks and those constituting claims on own foreign branches). However, 6. Includes Canal Zone beginning December 1979. see also footnote 2. 7. Foreign branch claims only. 2. For June 1978 and subsequent dates, the claims of the U.S. offices 8. Includes New Zealand, Liberia, and international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 International Statistics □ June 1980 3.21 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Holdings and Transactions Millions of dollars 1980 1979 Country or area 1978 1979 Jan.- Apr./7 Apr.P Holdings (end of period)1 1 Estimated total2 ...................................... 44,938 50,306 50,888 49,779 50,306 52,828 53,199' 52,995 52,089 2 Foreign countries2 ............................... 39,817 44,875 45,206 44,276 44,875 46,777 46,555' 46,532 46,428 3 Europe2 ............................................... 17,072 23,705 22,692 21,910 23,705 25,351 24,900' 24,609 24,002 4 Belgium-Luxembourg ...................... 19 60 65 60 60 60 55 27 28 5 Germany2 ........................................ 8,705 12,937 11,082 11,337 12,937 14,081 13,797' 13,489 13,203 6 Netherlands ...................................... 1,358 1,466 1,660 1,490 1,466 1,407 1,414 1,453 1,473 7 Sweden ............................................. 285 647 600 593 647 640 636 633 642 8 Switzerland2 .................................... 977 1,868 2,427 1,961 1,868 1,894 1,564 1,534 1,528 9 United Kingdom............................... 5,373 6,236 6,191 5,955 6,236 6,755 6,921 6,993 6,601 10 Other Western Europe ..................... 354 491 666 513 491 514 512 478 527 11 Eastern Europe ............................... 12 Canada ................................................ ’ ’' 152 ''' 232 ''' 235 ’ ’ ’ 234 ’' ’ 232 ’'' 231 ’ ’ ’ 389 394 ''' 381 13 Latin America and Caribbean.............. 416 546 541 539 546 546 547 552 581 14 Venezuela ........................................ 144 183 183 183 183 183 183 183 183 15 Other Latin American and Caribbean 110 200 194 192 200 200 201 206 199 16 Netherlands Antilles ........................ 162 163 164 164 163 163 164 164 199 17 Asia .................................................... 21,488 19,804 21,050 21,005 19,804 20,061 20,130 20,390 20,877 18 Japan ............................................... 11,528 11,175 12,591 12,502 11,175 10,844 10,420 9,631 9,533 19 Africa .................................................. 691 591 691 591 591 591 591 591 593 20 All other ............................................. -3 -3 -3 -3 -3 -3 -3 -3 -6 21 Nonmonetary international and regional organizations ................................. 5,121 5,431 5,682 5,503 5,431 6,051 5,661 22 International .................................... 5,089 5,388 5,636 5,463 5,388 6,016 6,592 6,407 5,606 23 Latin American regional................... 33 46 40 35 53 53 53 Transactions (net purchases, or sales (-), during period) 24 Total2 .................................................................. 6,297 5,368 1,783 632 -1,110 527 2,522 371 -207 -906 25 Foreign countries2 ............................................................. 5,921 5,059 1,553 146 -930 600 1,902 -223 -22 -104 26 Official institutions........................................................ 3,727 1,775 55 56 -1,037 547 481 -264 -103 -60 27 Other foreign2................................................................. 2,195 3,283 1,497 89 108 53 1,422 41 79 -45 28 Nonmonetary international and regional organizations ............................................................... 375 311 232 487 -180 -73 624 594 -185 -801 Memo: Oil-exporting countries 29 Middle East3 ........................................................................ -1,785 -1,015 2,540 299 64 168 550 500 1,014 475 30 Africa4 ................................................................................... 329 -100 -100 1. Estimated official and private holdings of marketable U.S. Treasury securities 2. Beginning December 1978, includes U.S. Treasury notes publicly issued to with an original maturity of more than 1 year. Data are based on a benchmark private foreign residents denominated in foreign currencies. survey of holdings as of Jan. 31, 1971, and monthly transactions reports. Excludes 3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and nonmarketable U.S. Treasury bonds and notes held by official institutions of for­ United Arab Emirates (Trucial States). eign countries. 4. Comprises Algeria, Gabon, Libya, and Nigeria. 3.22 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS Millions of dollars, end of period 1979 1980 Assets 1977 1978 1979 Nov. Dec. Jan. Feb. Mar. Apr. MayP 1 Deposits ................................................................................. 424 367 429 490 429 439 450 468 618 380 Assets held in custody 2 U.S. Treasury securities1 ............................................... 91,962 117,126 95,075 90,874 95,075 97,116 96,200 89,290 85,717 88,489 3 Earmarked gold2 ............................................................... 15,988 15,463 15,169 15,230 15,169 15,138 15,109 15,087 15,057 15,037 1. Marketable U.S. Treasury bills, notes, and bonds; and nonmarketable U.S. Note. Excludes deposits and U.S. Treasury securities held for international and Treasury securities payable in dollars and in foreign currencies. regional organizations. Earmarked gold is gold held for foreign and international 2. The value of earmarked gold increased because of the changes in par value accounts and is not included in the gold stock of the United States, 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 3.23 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1980 1979 1980 Transactions, and area or country 1978 1979 Jan.- Apr.P Oct. Nov. Dec. Jan. Feb. Mar. Apr.P U.S. corporate securities Stocks 1 Foreign purchases ............................................... 20,142 22,595 12,247 2,385 1,876 2,359 3,104 4,436 2,724 1,983 2 Foreign sales....................................................... 17,723 20,974 9,833 2,372 1,687 2,182 2,417 3,319 2,380 1,718 3 Net purchases, or sales (-) ........................................... 2,420 1,621 2,414 13 189 177 687 1,117 344 266 4 Foreign countries ............................................................... 2,466 1,605 2,409 13 192 173 686 1,119 342 263 5 Europe ................................................................ 1,283 216 1,646 -34 77 75 506 855 156 129 6 France ............................................................ 47 122 168 -48 -18 8 71 133 -49 14 7 Germany ......................................................... 620 -221 63 -32 -18 -10 35 51 -25 3 8 Netherlands ...................................................... -22 -71 -69 38 12 -25 8 -41 -6 -30 9 Switzerland ...................................................... -585 -519 419 -68 -148 -68 153 375 -36 -74 10 United Kingdom............................................... 1,230 964 1,018 83 278 155 215 332 277 194 11 Canada ................................................................ 74 550 360 67 14 47 40 125 130 66 12 Latin America and Caribbean............................. 151 -18 85 -93 -7 40 92 35 -49 6 13 Middle Easti ....................................................... 781 656 307 59 133 32 15 50 97 145 14 Other Asia ......................................................... 187 208 15 18 -29 -21 30 58 8 -81 15 Africa .................................................................. -13 -14 1 -1 1 -3 * -1 2 * 16 Other countries .................................................. 3 7 -6 -3 2 2 2 -3 -2 -2 17 Nonm or o g n a e n ta iz r a y t i i o n n te s rn .. a .. t .. i . o .. n .. a ... l . .. a .. n .. d .. .. r .. e .. g .. i . o ... n .. a .. l ........................ -46 17 4 * -3 4 1 -2 2 3 Bonds2 18 Foreign purchases ............................................... 7,975 8,840 4,975 827 732 964 1,149 934" 1,237 1,654 19 Foreign sales....................................................... 5,587 7,581 3,061 639 913 550 494 594 838 1,135 20 Net purchases, or sales (-) ........................................... 2,388 1,259 1,914 188 -181 414 655 340r 399 520 21 Foreign countries ............................................................... 1,979 1,360 1,776 48 -118 429 523 275" 407 570 22 Europe ................................................................ 837 638 815 88 -205 33 205 42" 315 252 23 France ............................................................ 30 11 32 1 11 1 8 1" 15 7 24 Germany ......................................................... 68 83 117 -7 2 2 -5 6 11 104 25 Netherlands ..................................................... 12 -202 -48 -7 -15 -20 -3 -30 * -14 26 Switzerland ..................................................... -170 -98 95 * -53 7 6 8 3 79 27 United Kingdom.............................................. 930 816 569 103 -124 36 195 71 265 38 28 Canada ................................................................ 102 90 63 8 -1 -16 25 28 8 2 29 Latin America and Caribbean............................. 98 112 45 6 12 15 14 10 9 13 30 Middle East* ....................................................... 810 424 836 -39 71 406 280 181 79 295 3 3 1 2 O Af t r h i e c r a A ... s . i . a . ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 - 3 1 1 94 1 7 2 -16 * 5 * -10 * * * 3 2 -4 * 7 * 33 Other countries .................................................. 1 1 8 1 * * * 8 34 Nonmonetary international and regional organizations ............................................................... 409 -102 139 140 -63 -14 132 65 -8 -50 Foreign securities 35 Stocks, net purchases, or sales (-)..................... 527 -786 -701 -198 -84 -130 -233 -426 -2 -40 36 Foreign purchases ........................................... 3,666 4,615 2,496 466 365 406 624 804 665 402 37 Foreign sales.................................................... 3,139 5,401 3,197 663 449 536 858 1,230 667 442 38 Bonds, net purchases, or sales (-) ..................... -4,052 -3,863 -138 -75 -334 -295 -72 -71 17 -12 39 Foreign purchases ........................................... 11,043 12,362 4,911 1,081 1,081 1,124 1,279 1,379 1,181 1,072 40 Foreign sales.................................................... 15,094 16,224 5,049 1,156 1,415 1,419 1,351 1,450 1,164 1,084 41 Net purchases, or sales (-), of stocks and bonds .. -3,525 -4,649 -839 -273 -419 -425 -305 -497 15 -52 42 Foreign countries ............................................................... -3,338 -3,889 -985 -277 -300 -563 -382 -498 -33 -72 43 Europe ................................................................ -64 -1,600 27 -38 -118 -282 176 -123 54 -80 44 Canada................................................................ -3,238 -2,600 -903 -358 -97 -142 -330 -415 -161 3 45 Latin America and Caribbean............................. 201 378 150 11 29 -14 5 101 29 14 46 Asia ................................................................... 350 -79 -238 112 -118 -128 -228 -47 49 -12 47 Africa .................................................................. -441 -14 -1 -6 1 2 -2 -1 * 3 48 Other countries .................................................. -146 25 -20 2 3 3 -4 -13 -3 * 49 Nonmonetary international and regional organizations ............................................................... -187 -760 146 4 -118 138 78 1 48 20 1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait, 2. Includes state and local government securities, and securities of U.S. gov- Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). ernment agencies and corporations. Also includes issues of new debt securities 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 □ June 1980 3.24 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1978 Type, and area or country 1976 1977 1978 June Sept. vlar. June Sept. Dec. 1 Total ..................................................... 10,099 11,085 14,265 15,164 15,490 16,548 2 Payable in dollars................................... 9,390 10,284 11,400 11,044 11,955 11,369 12,415 12,578 13,776 3 Payable in foreign currencies2................ 709 801 3,276 825 831 2,896 2,749 2,912 2,773 By type 4 Financial liabilities................................. 6,145 5,894 5,781 5,951 6,940 5 Payable in dollars............................... 3,745 3,705 3,735 3,790 4,958 6 Payable in foreign currencies.............. 2,400 2,190 2,046 2,161 1,982 7 Commercial liabilities ............................ 8,531 8,371 9,384 9,539 9,608 8 Trade payables ................................... 3,984 3,484 4,244 4,084 4,347 9 Advance receipts and other liabilities . 4,547 4,886 5,140 5,455 5,261 10 Payable in dollars............................... 7,655 7,664 8,680 8,788 8,818 11 Payable in foreign currencies.............. 876 707 703 750 790 By area or country Financial liabilities 12 Europe ............................................... 3,834 3,570 3,394 3,553 4,318 13 Belgium-Luxembourg ..................... 287 264 313 277 305 14 France ........................................... 162 138 134 126 166 15 Germany ........................................ 366 305 271 381 482 16 Netherlands .................................... 389 422 378 520 802 17 Switzerland .................................... 248 239 231 190 168 18 United Kingdom............................. 2,054 1,992 1,852 1,860 2,216 1% Canada ............................................... 242 258 292 300 369 20 Latin America and Caribbean............ 1,283 1,279 1,325 1,330 1,445 21 Bahamas ........................................ 426 411 442 345 319 22 Bermuda ........................................ 56 41 37 37 109 23 Brazil ............................................. 10 13 19 14 18 24 British West Indies ........................ 127 136 127 194 507 25 Mexico ........................................... 102 101 131 122 121 26 Venezuela ...................................... 49 55 65 71 72 27 Asia .................................................. 775 778 759 757 800 28 Japan ............................................. 714 714 706 700 723 29 Middle East oil-exporting countries3 27 23 19 19 35 30 Africa ................................................ 5 5 6 5 4 31 Oil-exporting countries4 ................. 2 1 2 1 1 32 All other5 ......................................... 5 5 5 4 Commercial liabilities 33 Europe .............................................. 2,972 2,941 3,255 3,395 3,620 34 Belgium-Luxembourg ................... 75 70 81 103 137 35 France ......................................... 317 339 339 394 460 36 Germany ...................................... 536 402 481 539 531 37 Netherlands ................................... 208 194 202 206 221 38 Switzerland .................................... 302 329 439 348 310 39 United Kingdom............................ 798 843 979 1,015 1,077 40 Canada ............................................. 667 614 651 709 852 41 Latin America .................................. 995 1,161 1,319 1,387 1,306 42 Bahamas ...................................... 25 16 65 89 69 43 Bermuda ...................................... 95 40 80 48 32 44 Brazil ........................................... 74 61 165 186 203 45 British West Indies ...................... 53 89 121 21 21 46 Mexico ......................................... 106 236 203 256 242 47 Venezuela .................................... 303 356 323 359 301 48 Asia ................................................ 2,950 2,636 3,021 2,985 2,864 49 Japan ........................................... 438 411 499 506 481 50 Middle East oil-exporting countries3 1,535 1,113 1,216 1,070 1,026 51 Africa .............................................. 743 779 891 775 728 52 Oil-exporting countries4 ............... 312 343 410 370 384 53 All other5 ........................................ 204 239 246 287 237 1. For a description of the changes in the International Statistics tables, see July 3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and 1979 Bulletin, p. 550. United Arab Emirates (Trucial States). 2. Before December 1978, foreign currency data include only liabilities denom­ 4. Comprises Algeria, Gabon, Libya, and Nigeria. inated in foreign currencies with an original maturity of less than one year. 5. Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A67 3.25 CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1978 Type, and area or country 1976 June Sept. Mar. June Sept. Dec. 1 Total ..................................................... 19,350 23,229 30,071 29,398 30,072 29,664 2 Payable in dollars.................................. 18,300 19,880 24,604 21,665 21,292 27,241 26,495 27,407 26,995 3 Payable in foreign currencies2.............. 1,050 1,418 3,022 1,564 1,968 2,829 2,904 2,665 2,669 By type 4 Financial claims .................................... 16,276 19,328 18,382 18,296 16,988 5 Deposits............................................. 10,815 13,895 12,807 12,886 11,808 6 Payable in dollars........................... 9,753 12,975 11,871 11,987 10,927 7 Payable in foreign currencies.......... 1,062 920 936 899 881 8 Other financial claims........................ 5,461 5,433 5,575 5,410 5,179 9 Payable in dollars........................... 3,872 3,893 4,012 4,013 3,797 10 Payable in foreign currencies.......... 1,589 1,540 1,563 1,397 1,382 11 Commercial claims................................. 11,351 10,743 11,016 11,776 12,677 12 Trade receivables............................... 10,712 9,996 10,311 11,016 11,987 13 Advance payments and other claims .. 639 747 705 760 690 14 Payable in dollars............................... 10,979 10,373 10,612 11,407 12,271 15 Payable in foreign currencies.............. 371 370 404 369 406 By area or country Financial claims 16 Europe ............................................... 5,035 5,164 5,458 6,403 6,000 17 Belgium-Luxembourg ..................... 48 63 54 33 32 18 France ........................................... 178 171 183 191 177 19 Germany ........................................ 510 266 361 391 398 20 Netherlands .................................... 103 85 62 51 53 21 Switzerland .................................... 96 81 85 73 22 United Kingdom............................. 4,253 4,478 5,365 4,941 23 Canada...................... ..................... 4,521 5,196 5,066 4,736 4,369 24 Latin America and Carribbean.......... 5,563 7,883 6,772 5,993 5,625 25 Bahamas ........................................ 2,871 4,111 3,173 2,831 2,294 26 Bermuda ........................................ 80 63 57 31 30 27 Brazil ............................................. 151 137 122 133 163 28 British West Indies ........................ 1,280 2,443 2,278 1,717 1,851 29 Mexico ........................................... 162 160 158 155 158 30 Venezuela ...................................... 150 142 148 139 133 31 Asia .................................................. 922 829 800 818 697 32 Japan ............................................. 307 207 216 222 190 33 Middle East oil-exporting countries3 18 16 17 21 20 34 Africa ................................................ 181 204 227 277 253 35 Oil-exporting countries4 ................. 10 26 23 41 49 36 All other5 .......................................... 52 61 69 44 Commercial claims 37 Europe ............................................... 3,990 3,837 3,842 4,121 4,885 38 Belgium-Luxembourg ..................... 148 177 174 179 203 39 France ........................................... 613 494 473 518 724 40 Germany ........................................ 416 514 435 448 580 41 Netherlands .................................... 262 274 306 262 298 42 Switzerland .................................... 198 230 232 224 269 43 United Kingdom............................. 817 691 724 818 905 44 Canada ............................................... 1,110 1,121 1,127 1,171 847 45 Latin America and Caribbean............ 2,544 2,391 2,403 2,598 2,859 46 Bahamas ........................................ 109 117 98 16 21 47 Bermuda ........................................ 215 241 118 154 197 48 Brazil ............................................. 626 491 499 568 647 49 British West Indies ........................ 9 10 25 13 16 50 Mexico ........................................... 506 489 584 650 704 51 Venezuela ...................................... 292 274 296 346 342 52 Asia .................................................. 3,081 2,756 2,969 3,116 3,292 53 Japan ............................................. 979 896 1,003 1,128 1,127 54 Middle East oil-exporting countries3 712 672 685 701 688 55 Africa ................................................ 447 443 487 549 556 56 Oil-exporting countries4 ................. 136 131 139 140 133 57 All other5 .......................................... 195 189 220 239 1. For a description of the changes in the International Statistics tables, see July 3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and 1979 Bulletin, p. 550. United Arab Emirates (Trucial States). 2. Prior to December 1978, foreign currency data include only liabilities de­ 4. Comprises Algeria, Gabon, Libya, and Nigeria. nominated in foreign currencies with an original maturity of less than one year. 5. Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 International Statistics □ June 1980 3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Percent per annum Rate on May 31, 1980 Rate on May 31, 1980 Rate on May 31, 1980 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 Norway .................................. 9.0 Nov. 1979 Austria .................................. 6.75 Mar. 1980 Germany, Fed. Rep. of .. 7.5 May 1980 Sweden .................................. 10.0 Jan. 1980 Belgium ............................... 14.0 Mar. 1980 Italy........................................ 15.0 Dec. 1979 Switzerland ......................... 3.0 Feb. 1980 Brazil .................................... 33.0 Nov. 1978 Japan .................................... 9.0 Mar. 1980 United Kingdom................ 17.0 Nov. 1979 Canada .................................. 11.83 May 1980 Mexico ................................. 4.5 June 1942 Venezuela ........................... 8.5 May 1979 Denmark ............................. 13.0 Feb. 1980 Netherlands ........................ 10.0 May 1980 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 Percent per annum, averages of daily figures 1979 1980 Country, or type 1977 1978 1979 Nov. Dec. Jan. Feb. Mar. Apr. May 1 Eurodollars .................................................... 6.03 8.74 11.96 15.00 14.51 14.33 15.33 18.72 17.81 11.20 2 United Kingdom........................................... 8.07 9.18 13.60 16.09 16.71 17.30 17.72 18.07 17.70 16.97 3 Canada ............................................................. 7.47 8.52 11.91 14.19 14.02 13.93 13.96 14.72 16.31 13.23 4 Germany ........................................................ 4.30 3.67 6.64 9.57 9.54 8.79 8.94 9.51 10.12 10.18 5 Switzerland .................................................... 2.56 0.74 2.04 3.97 5.67 5.45 5.19 6.57 6.87 5.85 6 Netherlands .................................................... 4.73 6.53 9.33 11.86 14.56 11.85 11.99 11.48 10.76 11.18 7 France ............................................................. 9.20 8.10 9.44 12.72 12.55 12.31 12.63 13.94 12.84 12.62 8 Italy ................................................................. 14.26 11.40 11.85 13.12 16.01 17.00 17.88 18.12 16.91 17.20 9 Belgium ........................................................... 6.95 7.14 10.48 14.17 14.49 14.38 14.45 16.23 17.10 16.75 10 Japan ............................................................... 6.22 4.75 6.10 8.13 8.42 8.44 9.10 12.37 13.51 13.63 Note. Rates are for 3-month interbank loans except for the following: francs and over; and Japan, loans and discounts that can be called after Canada, finance company paper; Belgium, time deposits of 20 million being held over a minimum of two month-ends. 3.28 FOREIGN EXCHANGE RATES Cents per unit of foreign currency 1979 1980 Country/currency 1977 1978 1979 Nov. Dec. Jan. Feb. Mar. Apr. May 1 Australia/dollar ..................... 110.82 114.41 111.77 109.34 110.30 110.97 110.41 109.03 109.10 113.02 2 Austria/schilling ................... 6.0494 6.8958 7.4799 7.8345 8.0039 8.0689 7.9815 7.5539 7.4513 7.8112 3 Belgium/franc ...................... 2.7911 3.1809 3.4098 3.4822 3.5423 3.5688 3.5221 3.3395 3.3156 3.4759 4 Canada/dollar ...................... 94.112 87.729 85.386 84.771 85.471 85.912 86.546 85.255 84.311 85.178 5 Denmark/krone..................... 16.658 18.156 19.010 19.034 18.618 18.568 18.326 17.325 17.104 17.859 6 Finland/markka ..................... 24.913 24.337 27.732 26.428 26.830 27.082 26.912 25.998 26.158 27.084 8 7 F G r e a r n m c a e n / y fr /d a e n u c t . s .. c . h .. e .. .. m .. a .. r . k .. ... .. .. .. . . . . .. . 2 4 0 3 . . 3 07 44 9 4 2 9 2 . . 8 2 6 1 7 8 2 54 3 . . 5 5 6 0 1 4 2 5 4 6. . 4 06 7 5 0 2 57 4 . . 6 6 7 1 1 4 5 2 7 4 . . 9 7 8 5 6 0 5 2 7 4 . . 2 4 0 1 3 3 2 5 3 4 . . 1 0 8 39 8 2 5 2 3 . . 9 3 8 1 5 0 2 55 3. .8 9 2 2 8 0 9 India/rupee .......................... 11.406 12.207 12.265 12.209 12.350 12.519 12.529 12.270 12.395 12.727 10 Ireland/pound ...................... 174.49 191.84 204.65 208.70 212.76 214.31 211.59 202.25 198.98 207.41 11 Italy/lira .................................... .11328 .11782 .12035 .12112 .12329 .12427 .12346 .11635 .11417 .11860 12 Japan/yen ............................. .37342 .47981 .45834 .40834 .41613 .42041 .40934 .40246 .39980 .43766 13 Malaysia/ringgit..................... 40.620 43.210 45.720 45.661 45.931 45.868 45.896 44.956 43.817 45.691 14 Mexico/peso.......................... 4.4239 4.3896 4.3826 4.3726 4.3768 4.3780 4.3789 4.3739 4.3779 4.3763 15 Netherlands/guilder .............. 40.752 46.284 49.843 50.686 52.092 52.527 51.886 49.270 48.570 50.673 16 New Zealand/dollar ................ 96.893 103.64 102.23 96.813 98.100 98.690 97.960 95.451 94.704 97.641 17 Norway/krone ...................... 18.789 19.079 19.747 19.928 20.092 20.373 20.483 19.815 19.739 20.377 18 Portugal/escudo..................... 2.6234 2.2782 2.0437 1.9852 2.0036 2.0051 2.0634 2.0116 1.9798 2.0298 19 South Africa/rand................. 114.99 115.01 118.72 120.32 120.79 121.64 122.90 123.59 123.88 126.43 20 Spain/peseta.......................... 1.3287 1.3073 1.4896 1.5051 1.5039 1.5124 1.5006 1.4446 1.3918 1.4104 21 Sri Lanka/rupee ...................... 11.964 6.3834 6.4226 6.4053 6.4300 6.4323 6.4350 6.4098 6.1500 6.1900 22 Sweden/krona ...................... 22.383 22.139 23.323 23.677 23.935 24.112 23.974 23.008 22.872 23.731 23 Switzerland/franc ................. 41.714 56.283 60.121 60.870 62.542 62.693 60.966 56.710 56.857 60.131 24 United Kingdom/pound......... 174.49 191.84 212.24 213.52 220.07 226.41 228.91 220.45 220.94 230.20 Memo: 25 United States/dollar1 ............ 103.31 92.39 88.09 88.12 86.32 85.52 86.37 90.26 91.09 86.96 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 page rencies of other G-10 countries plus Switzerland. March 1973 = 100. 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

Time and Savings Deposits A69 4.10 TIME AND SAVINGS DEPOSITS Held by Insured Commercial Banks on Recent Survey Dates Deposits Types of deposits, denomination, Number of issuing banks Millions of dollars Percentage change and original maturity July 25, Oct. 31, Jan. 30, July 25, Oct. 31, Jan. 30, July 25- Oct. 31- 1979 1979 1980 1979 1979 1980 Oct. 31 Jan. 30 Total time and savings deposits.................................... 14,206 14,375 14,231 625,123 650,160 649,621 4.0 -.1 Savings.............................................................................................. 14,206 14,375 14,227 217,522 207,983 197,766 -4.4 -4.9 Holder Individuals and nonprofit organizations........................... 14,206 14,375 14,227 202,465 194,249 184,279 -4.1 -5.1 Partnerships and corporations operated for profit (other than commercial banks) .................................. 10,065 10,055 10,390 10,736 9,758 9,125 -9.1 -6.5 Domestic government units.................................................. 8,096 8,462 8,712 4,035 3,600 3,925 -10.8 9.0 All other ..................................................................................... 1,605 1,594 1,981 285 377 437 32.1 16.0 Interest-bearing time deposits, less than $100,000 ........... 14,113 14,276 14,119 211,633 233,219 239,538 10.2 2.7 Holder Domestic governmental units1 ............................................. 10,269 10,156 10,577 2,679 2,506 2,177 -6.5 -13.1 30 up to 90 days.................................................................... 5,028 4,556 4,508 551 403 350 -26.8 -13.1 90 up to 180 days................................................................. 7,168 6,210 6,450 844 925 783 9.6 -15.3 180 days up to 1 year........................................................ 3,665 3,736 4,371 398 372 373 -6.6 .1 1 year and over .................................................................... 7,969 8,177 8,500 886 806 672 -9.1 -16.6 Other than domestic govermental units1 ......................... 14,032 14,189 14,006 140,313 134,012 115,068 -4.5 -14.1 30 up to 90 days.................................................................... 4,692 4,605 4,666 2,762 2,664 2,124 -3.6 -20.2 90 up to 180 days................................................................. 10,771 10,670 10,679 23,487 21,442 19,038 -8.7 -11.2 180 days up to 1 year........................................................ 8,357 7,943 7,395 2,763 2,808 2,286 1.6 -18.6 1 up to 2Vi years................................................................. 13,762 13,907 13,536 23,532 20,838 16,968 -11.4 -18.6 2 Vl up to 4 years................................................................. 12,819 12,869 12,631 14,668 14,106 11,503 -3.8 -18.4 4 up to 6 years...................................................................... 13,482 13,629 13,564 46,010 44,842 38,539 -2.5 -14.1 6 up to 8 years...................................................................... 11,599 11,534 11,568 23,922 23,652 21,588 -1.1 -8.7 8 years and over.................................................................... 8,635 8,265 8,650 3,169 3,661 3,020 15.5 -17.5 IRA and Keogh Plan time deposits, 3 years or more . 10,433 10,232 10,347 4,486 4,642 4,861 3.5 4.7 Money market certificates, $10,000 or more, exactly 6 months ................................................................................. 12,868 13,109 13,548 64,155 92,059 113,659 43.5 23.5 Variable interest rate ceiling time deposits of less than $100,000 with maturities of 2Vl years or more2 .. 0 0 11,606 0) 0) 3,773 Interest-bearing time deposits, $100,000 or more........... 11,654 12,863 12,711 189,323 203,187 206,833 7.3 1.8 Non-interest-bearing time deposits........................................ 1,263 1,464 1,340 4,487 4,566 4,619 1.8 1.2 Less than $100,000 .................................................................... 944 1,175 1,015 916 965 929 5.3 -3.7 $100,000 or more...................................................................... 663 606 611 3,570 3,601 3,690 .9 2.5 Club accounts (Christmas savings, vacation, and the like) .......................................................................................... 9,407 8,551 8,931 2,158 1,206 865 -44.1 -28.3 1. Exlcudes all money market certificates, IRAs, and Keogh Plan accounts. Note: All banks that had either discontinued offering or never offered certain 2. Effective Jan. 1, 1980, commercial banks, savings and loan associations, and types of deposits as of the survey date are not counted as issuing banks. However, mutual savings banks are authorized to offer variable ceiling accounts with no small amounts of deposits held at banks that had discontinued issuing certain types required minimum denomination and with maturities of 2Vi years or more. The of deposits are included in the amounts outstanding. maximum rate for commercial banks is 3A percentage points below the yield on Details may not add to totals because of rounding. 2Vi year U.S. Treasury securities: the ceiling rate for thrift institutions is Va per­ centage point higher than that for commercial banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A70 Special Tables □ June 1980 4.11 SMALL-DENOMINATION TIME AND SAVINGS DEPOSITS Held by Insured Commercial Banks on Jan. 30, 1980, Compared with Previous Survey, 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) All banks All banks Deposit group, original maturity, and distribu­ Less than 100 100 and over Less than 100 100 and over tion of deposits by Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, 1980 1979 1980 1979 1980 1979 1980 1979 1980 1979 1980 1979 Number of banks, or percentage distribution Amount of deposits (in million of dollars) or percentage distribution Savings deposits Individuals and nonprofit organizations Issuing banks...................................... 14,119 14,375 12,908 13,127 1,211 1,248 183,850 194,249 65,464 70,631 118,386 123,617 Distribution, total......................... 100 100 100 100 100 100 100 100 100 100 100 100 4.50 or less...................................... 2.1 4.7 1.8 4.6 5.8 6.7 4.8 5.0 3.7 3.5 5.4 5.9 4.51-5.00 ........................................ 8.4 11.8 8.7 12.3 4.8 6.4 5.8 7.8 6.5 9.4 5.5 7.0 5.01-5.25 ........................................ 89.5 83.4 89.5 83.1 89.4 87.0 89.4 87.1 89.8 87.1 89.1 87.2 Memo: Paying ceiling rate1........... 89.5 83.4 89.5 83.1 89.4 87.0 89.4 87.1 89.8 87.1 89.1 87.2 Partnerships and corporations Issuing banks...................................... 10,360 10,055 9,176 8,858 1,184 1,197 9,123 9,758 2,535 2,575 6,588 7,183 Distribution, total............................. 100 100 100 100 100 100 100 100 100 100 100 100 4.50 or less...................................... .9 .8 .8 .7 1.0 2.0 .8 1.2 .3 .3 .9 1.5 4.51-5.00 ........................................ 7.4 8.8 7.5 8.7 6.3 8.9 7.6 8.8 7.9 5.2 7.4 10.1 5.01-5.25 ........................................ 91.8 90.4 91.6 90.6 92.7 89.1 91.7 90.0 91.7 94.5 91.6 88.4 Memo: Paying ceiling rate1........... 91.8 90.4 91.6 90.6 92.7 89.1 91.7 90.0 91.7 94.5 91.6 88.4 Domestic governmental units Issuing banks...................................... 8,660 8,419 7,782 7,535 879 884 3,741 3,599 2,071 1,824 1,670 1,775 Distribution, total............................. 100 100 100 100 100 100 100 100 100 100 100 100 4.50 or less...................................... 1.0 3.6 .9 3.9 1.6 1.5 .2 1.5 (2) 2.5 .5 .5 4.51-5.00 ........................................ 5.7 7.7 5.5 7.5 6.7 9.0 9.4 10.2 10.8 8.1 7.6 12.3 5.01-5.25 ........................................ 93.4 88.7 93.6 88.6 91.6 89.5 90.4 88.3 89.2 89.4 91.9 87.2 Memo: Paying ceiling rates1......... 93.4 88.3 93.6 88.2 91.6 89.5 90.4 87.8 89.2 88.3 91.9 87.2 All other Issuing banks...................................... 1,958 1,585 1,753 1,368 205 217 429 360 254 159 175 200 Distribution, total............................. 100 100 100 100 100 100 100 100 100 100 100 100 4.50 or less...................................... 4.0 3.1 3.6 2.4 7.3 7.4 2.6 3.3 1.6 (2) 4.1 6.0 4.51-5.00 ........................................ 6.2 4.6 6.6 4.2 2.3 7.5 14.2 10.3 18.7 13.3 7.7 8.0 5.01-5.25 ........................................ 89.9 92.3 89.8 93.4 90.4 85.1 83.2 86.3 79.7 86.7 88.2 86.0 Memo: Paying ceiling rate1........... 89.9 92.3 89.8 93.4 90.4 85.1 83.2 86.3 79.7 86.7 88.2 86.0 Time deposits less than $100,000 Domestic governmental units 30 up to 90 days Issuing banks.................................. 4,480 4,485 3,853 3,826 626 659 350 383 223 227 127 156 Distribution, total......................... 100 100 100 100 100 100 100 100 100 100 100 100 5.00 or less.................................. 27.1 41.2 28.1 42.0 20.9 36.8 23.2 24.3 28.6 27.5 13.7 19.5 5.01-5.50 .................................... 31.8 27.9 29.2 27.1 48.1 32.8 18.3 26.6 12.3 26.6 28.8 26.6 5.51-8.00 .................................... 41.1 30.9 42.7 30.9 30.9 30.4 58.5 49.1 59.1 45.9 57.5 53.9 Memo: Paying ceiling rate1........... 30.6 22.3 31.3 21.4 26.5 27.6 49.4 42.2 46.3 36.5 54.8 50.5 90 up to 180 days Issuing banks.................................. 6,450 6,205 5,700 5.418 750 787 783 925 612 655 171 270 Distribution, total......................... 100 100 100 100 100 100 100 100 100 100 100 100 5.00 or less.................................. 3.3 3.7 3.5 3.8 1.2 3.0 1.8 1.3 1.7 1.7 2.1 .3 5.01-5.50 .................................... 44.6 76.8 45.3 77.0 39.7 75.3 33.7 83.6 30.5 83.8 45.4 83.1 5.51-8.00 .................................... 52.1 19.5 51.2 19.2 59.0 21.7 64.5 15.1 67.8 14.6 52.5 16.6 Memo: Paying ceiling rate1........... 13.4 14.5 12.3 13.6 21.8 20.5 43.8 10.9 50.7 8.7 19.5 16.4 180 days up to 1 year Issuing banks.................................. 4,279 3,731 3,725 3,157 554 574 340 372 195 221 145 151 Distribution, total......................... 100 100 100 100 100 100 100 100 100 100 100 100 5.00 or less.................................. 2.8 4.3 3.2 5.1 .2 .4 .1 .6 .1 .7 (2) .3 5.01-5.50 .................................... 39.8 60.2 40.9 58.7 32.8 68.4 37.2 65.7 50.4 63.6 19.5 68.7 5.51-8.00 .................................... 57.3 35.5 55.9 36.2 67.0 31.2 62.7 33.8 49.5 35.6 80.5 31.0 Memo: Paying ceiling rate1........... 28.4 15.8 29.1 14.0 24.2 25.9 30.5 21.9 34.3 17.4 25.4 28.5 1 year and over Issuing banks.................................. 8,499 8,134 7,767 7,321 732 812 672 800 574 621 97 179 Distribution, total......................... 100 100 100 100 100 100 100 100 100 100 100 100 5.50 or less.................................. 6.9 3.4 7.1 3.1 5.2 5.6 8.5 16.3 8.8 9.9 6.8 38.7 5.51-6.00 .................................... 55.0 60.5 54.7 60.2 59.1 63.1 54.7 57.0 57.0 64.2 40.9 32.0 6.01-8.00 .................................... 38.0 36.1 38.3 36.7 35.7 31.3 36.8 26.6 34.2 25.9 52.3 29.3 Memo: Paying ceiling rate1........... 11.4 6.1 11.1 4.8 14.0 17.8 13.2 9.0 10.2 5.2 30.8 22.3 For notes see end of table. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Time and Savings Deposits A ll 4.11 SMALL-DENOMINATION TIME AND SAVINGS DEPOSITS Continued Size of bank Size of bank All banks (total deposits in millions of dollars) All banks (total deposits in millions of dollars) Deposit group, original maturity, ana distribu­ Less than 100 100 and over Less than 100 100 and over tion of deposits by most common rate Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, 1980 1979 1980 1979 1980 1979 1980 1979 1980 1979 1980 1979 Number of banks or percentage distribution Amount of deposits (in millions of dollars) or percentage distribution Time deposits less than $100,000 (cont.) Other than domestic governmental units 30 up to 90 days Issuing banks.................................................. 4,576 4,600 3,711 3,657 865 943 2,123 2,664 386 392 1,737 2,272 Distribution, total......................................... 100 100 100 100 100 100 100 100 100 100 100 100 5.00 or less ............................................... 28.2 73.7 28.0 79.5 29.0 51.4 19.8 47.6 3.9 87.2 23.4 40.8 5.01-5.25 .................................................... 71.8 26.3 72.0 20.5 71.0 48.6 80.2 52.4 96.1 12.8 76.6 59.2 Memo: Paying ceiling rate1 ......................... 71.8 26.3 72.0 20.5 71.0 48.6 80.2 52.4 96.1 12.8 76.6 59.2 90 up to 180 days Issuing banks.................................................. 5,924 10,670 5,371 9,431 553 1,239 8,940 21,442 2,384 7,732 6,555 13,710 Distribution, total......................................... 100 100 100 100 100 100 100 100 100 100 100 100 5.00 or less ............................................... 4.4 2.1 4.7 2.3 1.4 .3 1.7 .4 1.2 .4 1.9 .5 5.01-5.50 .................................................... 95.6 97.9 95.3 97.7 98.6 99.7 98.3 99.6 98.8 99.6 98.1 99.5 Memo: Paying ceiling rate1 ......................... 89,7 93.2 89.0 92.6 96.0 97.6 94.5 92.1 92.2 85.7 95.4 95.7 180 days up to 1 year Issuing banks.................................................. 4,612 7,768 4,258 6,814 354 954 1,171 2,798 467 1,253 704 1,545 Distribution, total......................................... 100 100 100 100 100 100 100 100 100 100 100 100 5.00 or less ............................................... 2.9 4.9 2.8 5.4 4.6 1.5 2.1 1.6 5.0 3.5 .2 .1 5.01-5.50 .................................................... 97.1 95.1 97.2 94.6 95.4 98.5 97.9 98.4 95.0 96.5 99.8 99.9 Memo: Paying ceiling rate1 ......................... 96.8 94.3 97.2 93.9 91.6 97.4 97.9 97.4 95.0 94.8 99.8 99.5 1 up to 2Yi years Issuing banks.................................................. 13,536 13,907 12,331 12,674 1,205 1,233 16,968 20,838 10,733 13,407 6,235 7,431 Distribution, total......................................... 100 100 100 100 100 100 100 100 100 100 100 100 5.50 or less ............................................... .1 2.1 (2) 2.1 1.4 2.1 .6 1.8 (2) 1.9 1.7 1.7 5.51-6.00 ................................................... 99.9 97.9 100.0 97.9 98.6 97.9 99.4 98.2 100.0 98.1 98.3 98.3 Memo: Paying ceiling rate1 ......................... 99.0 97.6 99.1 97.7 97.7 97.0 99.0 97.7 99.7 98.0 97.7 97.0 2 Vl years up to 4 years Issuing banks................................................. 12,549 12,866 11,360 •11,637 1,189 1,229 11,456 14,104 6,578 8,305 4,878 5,799 Distribution, total......................................... 100 100 100 100 100 100 100 100 100 100 100 100 6.00 or less ............................................... .8 2.9 .6 3.0 2.2 2.4 .7 3.5 (2) 5.2 1.6 1.1 6.01-6.50 .................................................... 99.2 97.1 99.4 97.0 97.8 97.6 99.3 96.5 100.0 94.8 98.4 98.9 Memo: Paying ceiling rate1 ......................... 99.2 97.0 99.4 97.0 97.3 96.7 93.8 96.1 100.0 94.8 85.4 98.0 4 up to 6 years Issuing banks.................................................. 13,322 12,254 12,131 11,249 1,191 1,005 38,250 36,881 20,881 21,341 17,370 15,540 Distribution, total......................................... 100 100 100 100 100 100 100 100 100 100 100 100 7.00 or less ............................................... 5.7 6.6 5.9 6.6 3.5 7.0 3.8 5.6 4.4 5.9 3.1 5.2 7.01-7.25 .................................................... 94.3 92.1 94.1 92.6 96.5 87.6 96.2 91.2 95.6 92.5 96.9 89.6 7.26-7.60 .................................................... (2) 1.2 (2) .9 (2) 5.4 (2) 3.2 (2) 1.6 (2) 5.2 Memo: Paying ceiling rate13 ....................... 94.2 .6 94.1 .3 95.7 3.6 96.1 2.1 95.6 .9 96.7 3.8 6 up to 8 years Issuing banks.................................................. 11,453 11,152 10,307 10,024 1,146 1,128 21,541 22,172 9,232 9,952 12,309 12,220 Distribution, total......................................... 100 100 100 100 100 100 100 100 100 100 100 100 7.25 or less ............................................... 1.7 3.8 1.7 3.8 2.0 3.5 4.3 2.5 1.2 1.8 6.6 3.0 7.25-7.50 .................................................... 98.3 96.1 98.3 96.2 98.0 94.7 95.7 96.5 98.8 98.2 93.4 95.2 Mem 7 o . : 5 P 1- a 7 y . i 6 n 0 g c . e .. i . l . i .. n .. g .. .. r .. a .. t .. e .. 1 ... 3 ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97 ( . 2 9 ) . . 2 2 98 ( . 2 0 ) 0 (2) 97 ( . 2 2 ) 1 1. . 8 8 95 ( . 2 7 ) 1 1. .0 0 98 ( . 2 8 ) Q (2) 93 ( . 2 4 ) 1 1 . .8 8 8 years and over Issuing banks................................................. 8,594 8,018 7,538 6,982 1,055 1,035 3,005 3,158 1,202 1,376 1,803 1,782 Distribution, total......................................... 100 100 100 100 100 100 100 100 100 100 100 100 7.50 or less ............................................... 2.8 3.6 2.5 3.1 4.8 6.7 11.3 13.1 .1 .2 18.7 23.0 7.51-7.75 .................................................... 97.2 96.4 97.5 96.9 95.2 93.3 88.7 86.9 99.9 99.8 81.3 77.0 Memo: Paying ceiling rate13....................... 97.2 95.3 97.5 95.7 95.2 92.4 88.7 85.7 99.9 99.8 81.3 74.9 IRA and Keogh Plan time deposits, 3 years or more Issuing banks...................................................... 8,653 10,227 7,631 9,081 1,023 1,146 4,212 4,636 1,448 1,705 2,765 2,931 Distribution, total ........................................... 100 100 100 100 100 100 100 100 100 100 100 100 6.00 or less .................................................... 3.5 5.0 3.8 5.4 1.0 1.7 .6 2.0 1.5 1.9 .2 2.1 6.01-7.00 ........................................................ 5.8 5.7 6.3 6.0 2.4 3.3 1.0 2.1 1.6 1.5 .6 2.4 7.01-7.50 ........................................................ 20.0 22.1 21.5 23.5 8.8 11.1 8.8 10.4 13.3 16.8 6.4 6.7 7.51-8.00 ........................................................ 70.6 67.2 68.3 65.1 87.8 83.9 89.6 85.5 83.6 79.8 92.7 88.8 Memo: Paying ceiling rate1 ......................... 62.8 57.4 60.6 55.7 79.1 70.9 81.3 76.0 76.1 72.3 84.0 78.1 Money market certificates, $10,000 or more, 6 months Issuing banks...................................................... 13,548 13,109 12,338 11,867 1,210 1,242 113,659 92,059 50,579 40,806 63,080 51,252 Distribution, total ........................................... 100 100 100 100 100 100 100 100 100 100 100 100 Up to 10.99.................................................... .9 96.9 .9 96.7 1.2 98.4 .4 98.4 (2) 98.2 .7 98.5 11.00-11.74 .................................................... (2) 3.1 (2) 3.3 .4 1.6 .1 1.6 (2) 1.8 .2 1.5 Me 1 m 1. o 7 : 5 p 1 a 1 y . i 8 n 9 g c . e .. i .. l . i . n ... g .. . r ... a .. t . e .. 1 .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 9 9 6 . . 1 8 ( (2 2j ) 9 99 6 . . 1 7 (2) 9 9 7 8. . 5 6 iI22)) 1 9 0 8 0 . . 9 0 ( i 2 2 ) ) 1 9 0 9 0 . . 4 0 ( ( 2 2 ) ) 9 99 8 . . 1 5 ( (2 2 ) ) For notes see end of table. type of deposit outstanding. All banks that had either discontinued offering or never offered particular types of deposit as of the survey data were excluded from Note. The average rates were calculated by weighting the most common rate the calculations for those specific types of deposits, reported on each type of deposit at each bank by the amount of that Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A72 Special Tables □ June 1980 4.11 SMALL-DENOMINATION TIME AND SAVINGS DEPOSITS 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 ma ti t o u n r it o y f , d a e n p d o s d i i t s s t r b i y b u­ Less than 100 100 and over Less than 100 100 and over most common rate Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, Jan. 30, Oct. 31, 1980 1979 1980 1979 1980 1979 1980 1979 1980 1979 1980 1979 Number of banks, or percentage distribution Amount of deposits (in millions of dollars) or percentage distribution Time deposits less than $100,000 (cont.) Variable interest rate ceiling time de­ posits of less than $100,000 with maturities of 2!/2 years or more Issuing banks...................................................... 11,601 10,434 1,168 3,773 2,119 1,654 Distribution, total ........................................... 100 100 100 100 100 100 100 100 100 100 100 9.00 or less .................................................... (2) (2) 100 .1 (2) (2) (2) 9.01-10.00 ...................................................... 1.9 1.8 2.8 8.2 13.7 1.1 10.01-10.15 .................................................... 98.1 98.2 97.1 91.8 86.3 98.8 Memo: Paying ceiling rate1 ......................... 97.4 97.4 97.1 91.3 85.4 98.8 Club accounts Issuing banks...................................................... 6,385 6,580 5,932 6,061 453 519 545 711 295 322 250 389 Distribution, total ........................................... 100 100 100 100 100 100 100 100 100 100 100 100 0.00 .................................................... 60.2 53.1 62.0 54.7 36.1 34.1 25.1 28.4 32.1 33.3 16.9 24.3 0.01^.00 ........................................... 18.9 19.8 17.9 19.3 31.7 25.9 28.2 17.5 26.7 21.2 30.0 14.4 4.01-4.50 ........................................................ 8.0 7.4 8.0 7.1 8.2 10.7 19.4 9.7 15.1 4.1 24.4 14.4 4.51-5.50 ........................................................ 12.9 19.7 12.1 18.9 24.1 29.3 27.3 44.4 26.1 41.4 28.7 46.9 !See Bulletin table A8 for the ceiling rates that existed at the time of each particular types of deposits as the survey date are not counted as issuing banks. survey. Moreover, the small amounts of deposits held at banks that had discontinued 2Less than .05 percent. issuing deposits are not included in the amounts outstanding. Therefore, the deposit 3In October 1979 these deposit categories included the variable ceiling rate amounts shown in table 4.10 may exceed the deposit amounts shown in the table. account of 4 years and over issued since July 1, 1979; the ceiling rate on such The most common interest rate for each instrument refers to the stated rate per accounts was 7.60 percent in October. In January 1980 all variable ceiling accounts annum (before compounding) that banks paid on the largest dollar volume of were excluded from these categories and hence the fixed rate ceilings that apply deposit inflows during the 2-week period immediately preceding the survey date. to each maturity category are shown in the table. Details may not add to totals because of rounding. Note. All banks that either had discontinued offering or had never offered 4.12 AVERAGE OF MOST COMMON INTEREST RATES PAID on Various Categories of Time and Savings Deposits at Insured Commercial Banks, Jan. 30, 1980 Bank size (total deposit in million of dollars) Type of deposit, holder, and original maturity 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............................................... 7.39 7.41 7.73 7.48 7.42 7.08 7.19 Savings, total .............................................................................................................. 5.18 5.07 5.18 5.17 5.21 5.15 5.19 Individuals and nonprofit organizations........................................................ 5.18 5.06 5.21 5.16 5.21 5.15 5.18 Partnerships and corporations.......................................................................... 5.22 5.24 5.23 5.21 5.23 5.16 5.23 Domestic governmental units .......................................................................... 4.98 5.25 4.03 5.20 5.15 5.19 5.23 All other .................................................................................................................. 5.06 5.25 5.13 5.13 4.70 5.25 5.20 Other time deposits in denominations of less than $100,000, total 6.66 6.43 6.79 6.74 6.72 6.65 6.60 Domestic governmental units, total ............................................................... 6.45 6.04 6.83 6.45 6.17 6.89 6.75 30 up to 90 days................................................................................................ 6.69 7.25 6.19 6.23 6.54 7.04 6.90 90 up to 180 days.............................................................................................. 6.69 6.05 7.23 6.14 5.87 6.67 6.42 11 8 y 0 e a d r a y a s n u d p o t v o e r 1 . y ... e .. a ... r ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 5 . . 4 7 2 9 4 6 . . 9 2 1 2 6 6 . . 5 3 2 9 6 6 . . 7 7 3 8 6 5 . . 8 9 6 7 6 6 . .9 8 9 6 6 6. . 7 9 3 0 Other than domestic government units, total................................................. 6.66 6.44 6.78 6.74 6.73 6.65 6.60 30 up to 90 days..................................................................................................... 5.18 5.25 5.13 5.23 5.21 5.11 5.19 90 up to 180 days................................................................................................... 5.62 5.66 5.68 5.63 5.60 5.63 5.61 2 11 8 V u 0 i p u d p a to y t s o 2 u V 4 p i y y to e e a a 1 r r s s y . . . . e . .. . a . . . . . . r . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 5 6. . . 4 1 9 5 6 9 6 3 6 . . . 5 0 5 8 0 0 6 6 5 . . . 0 5 4 0 0 4 6 5 6 . . . 0 4 5 5 0 6 6 5 5 . . . 6 4 9 5 6 9 6 5 5 . . . 4 6 9 8 4 8 5 6 5 . . . 4 5 9 1 7 9 4 6 8 u u ye p p a r t t o o s o 6 8 r y y m e e a a o r r r e s s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 7 7 . . . 1 6 4 8 7 6 6 7 7 . . . 9 7 5 5 2 0 7 7 7 . . . 4 7 2 5 5 4 7 7 7 . . . 1 4 3 9 7 2 7 7 7 . . . 2 4 7 4 9 4 7 7 7 . . . 7 2 4 1 4 6 7 7 7 . . . 2 6 4 3 5 4 IRA and Keogh Plan time deposits, 3 years or more................................. 8.25 8.51 8.54 8.15 8.23 8.01 8.19 Money market certificates, exactly 6 months................................................. 11.87 11.88 11.88 11.88 11.87 11.81 11.88 Variable interest rate ceiling time deposits of less than $100,000 with maturities of 2Vi years or more^............................................................ 10.14 10.15 10.12 10.15 10.14 10.15 10.15 Club accounts; ........................................................................................................... 3.97 1.92 3.80 3.81 4.37 4.31 4.46 1. Club accounts are excluded from all of the other categories. reported on each type of deposit at each bank by the amount of that type of deposit 2. See note 2 in table 4.10. outstanding. All banks that had either discontinued offering or never offered particular types of deposit as of the survey date were exlcuded from the calculations Note. The average rates were calculated by weighting the most common rate for those specific types of deposits. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A73 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 heading IPCs Individuals, partnerships, and corporations when more than half of figures in that column REITs Real estate investment trusts are changed.) RPs Repurchase agreements Amounts insignificant in terms of the last decimal SMSAs Standard metropolitan statistical areas place shown in the table (for example, less than Cell not applicable 500,000 when the smallest unit given is mil­ lions) General Information Minus signs are used to indicate (1) a decrease, (2) a negative gations of the Treasury. “State and local government” also figure, or (3) an outflow. includes municipalities, special districts, and other political “U.S. government securities” may include guaranteed is­ subdivisions. sues of U.S. government agencies (the flow of funds figures In some of the tables details do not add to totals because of also include not fully guaranteed issues) as well as direct obli- rounding. Statistical Releases List Published Semiannually, with Latest Bulletin Reference Issue Page Anticipated schedule of release dates for individual releases ......................... June 1980 A-80 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A74 Federal Reserve Board of Governors Paul A. Volcker, Chairman Henry C. Wallich Frederick H. Schultz, Vice Chairman J. Charles Partee Office of Board Members Office of Staff Director for Monetary and Financial Policy Joseph R. Coyne, Assistant to the Board Jay Paul Brenneman, Special Assistant to the Board Stephen H. Axilrod, Staff Director Frank O’Brien, Jr., Special Assistant to the Board Edward C. Ettin, Deputy Staff Director Joseph S. Sims, Special Assistant to the Board Murray Altmann, Assistant to the Board Donald J. Winn, Special Assistant to the Board Peter M. Keir, Assistant to the Board Stanley J. Sigel, Assistant to the Board Normand R. V. Bernard, Special Assistant to the Board Legal Division Neal L. Petersen, General Counsel Division of Research and Statistics Robert E. Mannion, Deputy General Counsel Charles R. McNeill, Assistant to the General Counsel James L. Kichline, Director J. Virgil M attingly, Assistant General Counsel Joseph S. Zeisel, Deputy Director Gilbert T. Schwartz, Assistant General Counsel Michael J. Prell, Associate Director Robert A. Eisenbeis, Senior Deputy Associate Director tJoHN J. Mingo, Senior Deputy Associate Director Office of the Secretary Eleanor J. Stockwell, Senior Deputy Associate Director Jared J. Enzler, Deputy Associate Director Theodore E. Allison, Secretary J. Cortland G. Peret, Deputy Associate Director Griffith L. Garwood, Deputy Secretary Helmut F. Wendel, Deputy Associate Director Barbara R. Lowrey, Assistant Secretary M artha Bethea, Assistant Director *Cathy L. Petryshyn, Assistant Secretary Robert M. Fisher, Assistant Director fRiCHARD H. Puckett, Assistant Secretary Frederick M. Struble, Assistant Director Stephen P. Taylor, Assistant Director Levon H. Garabedian, Assistant Director (Administration) Division of Consumer and Community Affairs Division of International Finance Janet O. Hart, Director Nathaniel E. Butler, Associate Director Edwin M. Truman, Director Jerauld C. Kluckman, Associate Director Robert F. Gemmill, Associate Director George B. Henry, Associate Director Charles J. Siegman, Associate Director Division of Banking Samuel Pizer, Staff Adviser Supervision and Regulation Jeffrey R. Shafer, Deputy Associate Director Dale W. Henderson, Assistant Director Larry J. Promisel, Assistant Director John E. Ryan, Director Ralph W. Smith, Jr., Assistant Director Frederick R. Dahl, Associate Director William Taylor, Associate Director William W. Wiles, Associate Director Jack M. Egertson, Assistant Director Robert A. Jacobsen, Assistant Director Don E. Kline, Assistant Director Robert S. Plotkin, Assistant Director Thomas A. Sidman, Assistant Director Samuel H . Talley, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A75 and Official Staff Nancy H. Teeters Lyle E. Gramley Emmett J. Rice Office of Office of Staff Director for Staff Director for Management Federal Reserve Bank A ctivities John M. Denkler, Staff Director William H. W allace, Staff Director Edward T. M ulrenin, Assistant Staff Director Harry A. Guinter, Assistant Director for Contingency Joseph W. Daniels, Sr. , Director of Equal Employment Op­ Planning portunity Division of Federal Reserve Division of Data Processing Bank Operations Charles L. Hampton, Director James R. Kudlinski, Director Bruce M. Beardsley, Associate Director Clyde H. Farnsworth, Jr., Deputy Director Uyless D. Black, Assistant Director W alter Althausen, Assistant Director Glenn L. Cummins, Assistant Director Charles W. Bennett, Assistant Director Robert J. Zemel, Assistant Director Lorin S. Meeder, Assistant Director P. D. Ring, Assistant Director Raymond L. Teed, Assistant Director Division of Personnel David L. Shannon, Director John R. Weis, Assistant Director Charles W. Wood, Assistant Director Office of the Controller John Kakalec, Controller George E. Livingston, Assistant Controller Division of Support Services Donald E. Anderson, Director W alter W. Kreimann, Associate Director *On loan from the Federal Reserve Bank of Cleveland. +On leave of absence. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A76 Federal Reserve Bulletin □ June 1980 FOMC and Advisory Councils Federal Open Market Committee Paul A. Volcker, Chairman Anthony M. Solomon, Vice Chairman Lyle E. Gramley J. Charles Partee Nancy H. Teeters Roger Guffey Emmett J. Rice Henry C. Wallich Frank E. Morris Lawrence K. Roos Willis J. Winn Frederick H. Schultz Murray Altmann, Secretary Richard G. Davis, Associate Economist Normand R. V. Bernard, Assistant Secretary Thomas Davis, Associate Economist Neal L. Petersen, General Counsel Robert Eisenmenger, Associate Economist James H. Oltman, Deputy General Counsel Edward C. Ettin, Associate Economist Robert E. Mannion, Assistant General Counsel George B. Henry, Associate Economist Stephen H. Axilrod, Economist Peter M. Keir, Associate Economist Alan R. Holmes, Adviser for Market Operations James L. Kichline, Associate Economist Anatol Balbach, Associate Economist Edwin M. Truman, Associate Economist John Davis, Associate Economist Joseph S. Zeisel, Associate Economist Peter D. Sternlight, Manager for Domestic Operations, System Open Market Account Scott E. Pardee, Manager for Foreign Operations, System Open Market Account Federal Advisory Council Clarence C. Barksdale, Eighth District, President James D. Berry, Eleventh District, Vice President Henry S. Woodbridge, Jr., First District Robert Strickland, Sixth District Donald C. Platten, Second District Roger E. Anderson, Seventh District William B. Eagleson, Jr., Third District Clarence G. Frame, Ninth District Merle E. Gilliand, Fourth District Gordon E. Wells, Tenth District J. Owen Cole, Fifth District Chauncey E. Schmidt, Twelfth District Herbert V. Prochnow, Secretary William J. Korsvik, Associate Secretary Consumer Advisory Council William D. Warren, Los Angeles, California, Chairman Marcia A. Hakala, Omaha, Nebraska, Vice Chairman Julia H. Boyd, Washington, D.C. Harvey M. Kuhnley, Minneapolis, Minnesota Roland E. Brandel, San Francisco, California The Rev. Robert J. McEwen, S.J., Boston, Massachusetts Ellen Broadman, Washington, D.C. R. C. Morgan, El Paso, Texas James L. Brown, Milwaukee, Wisconsin Margaret Reilly-Petrone, Upper Montclair, New Jersey Mark E. Budnitz, Atlanta, Georgia Rene Reixach, Rochester, New York Robert V. Bullock, Frankfort, Kentucky Florence M. Rice, New York, New York Richard S. D’Agostino, Philadelphia, Pennsylvania Ralph J. Rohner, Washington D.C. Joanne Faulkner, New Haven, Connecticut Henry B. Schechter, Washington, D.C. Vernard W. Henley, Richmond, Virginia Peter D. Schellie, Washington, D.C. Juan Jesus Hinojosa, McAllen, Texas E. G. Schuhart, II, Amarillo, Texas Shirley T. Hosoi, Los Angeles, California Charlotte H. Scott, Charlottesville, Virginia F. Thomas Juster, Ann Arbor, Michigan Richard A. Van Winkle, Salt Lake City, Utah Richard F. Kerr, Cincinnati, Ohio Richard D. Wagner, Simsbury, Connecticut Robert J. Klein, New York, New York Mary W. Walker, Monroe, Georgia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A77 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* .................. 02016 Robert M. Solow Frank E. Morris Robert P. Henderson James A. McIntosh NEW YORK* ............. 10045 Robert H. Knight Anthony M. Solomon Boris Yavitz Thomas M. Timlen Buffalo....................... 14240 Frederick D. Berkeley, III 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 J. L. Jackson Walter H. MacDonald Cincinnati.................. 45201 Lawrence H. Rogers, II Robert E. Showaiter Pittsburgh...................15230 William H. Knoell Robert D. Duggan RICHMOND* ..............23261 Maceo A. Sloan Robert P. Black Steven Muller Jimmie R. Monhollon Baltimore...................21203 Catherine Byrne Doehler Robert D. McTeer, Jr. Charlotte ...................28230 Robert E. Elberson Stuart P. Fishburne Culpeper Communications and Records Center 22701 Albert D. Tinkelenberg ATLANTA ...................30303 William A. Fickling, Jr. Vacancy John H. Weitnauer, Jr. Robert P. Forrestal Birmingham ............. 35202 Harold B. Blach, Jr. Hiram J. Honea Jacksonville ..............32203 Joan W. Stein Charles D. East Miami ....................... 33152 David G. Robinson F. J. Craven, Jr. Nashville ..................,37203 Robert C. H. Mathews, Jr. Jeffrey J. Wells New Orleans..............70161 George C. Cortright, Jr. Pierre M.Viguerie CHICAGO*.................. 60690 John Sagan Robert P. Mayo Stanton R. Cook Daniel M. Doyle Detroit........................48231 Howard F. Sims William C. Conrad ST. LOUIS .................. 63166 Armand C. Stalnaker Lawrence K. Roos William B. Walton Donald W. Moriarty, Jr. Little Rock............... .72203 E. Ray Kemp, Jr. John F. Breen Louisville.................. 40232 Richard O. Donegan Donald L. Henry Memphis .................. 38101 Charles S. Youngblood Robert E. Matthews MINNEAPOLIS.......... 55480 Stephen F. Keating Mark H. Willes William G. Phillips Thomas E. Gainor Helena....................... 59601 Patricia P. Douglas Betty J. Lindstrom KANSAS CITY .......... 64198 Joseph H. Williams Roger Guffey Paul H. Henson Henry R. Czerwinski Denver....................... 80217 Caleb B. Hurtt Wayne W. Martin Oklahoma City.......... .73125 Christine H. Anthony William G. Evans Omaha........................68102 Robert G. Lueder Robert D. Hamilton DALLAS .................... ,75222 Irving A. Mathews Ernest T. Baughman Gerald D. Hines Robert H. Boykin El Paso....................... ,79999 Chester J. Kesey Joel L. Koonce, Jr. Houston.................... .77001 Gene M. Woodfin J. Z. Rowe San Antonio ..............78295 Carlos A. Zuniga Carl H. Moore SAN FRANCISCO..... 94120 Cornell C. Maier John J. Balles Caroline L. Ahmanson John B. Williams Los Angeles .............,90051 Harvey A. Proctor 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 04240 06096 07016 *Additional offices of these Banks are located at Lewiston, Maine ; Windsor Locks, Connecticut ; Cranford, New Jersey ; 11753 13424 43216 29210 Jericho, New York ; Utica at Oriskany, New York ; Columbus, Ohio ; Columbia, South Carolina ; Charleston, West 25311 50306 46204 53202 Virginia ; Des Moines, Iowa ; Indianapolis, Indiana ; and Milwaukee, Wisconsin . Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A78 Federal Reserve Board Publications Copies are available from PUBLICATIONS SERVICES. request and be made payable to the order of the Board of ROOM MP-510, BOARD OF GOVERNORS OF THE FED­ Governors of the Federal Reserve System. Remittance from ERAL RESERVE SYSTEM, WASHINGTON, D.C. 20551. foreign residents should be drawn on a U.S. bank. Stamps When a charge is indicated, remittance should accompany and coupons are not accepted. The Federal Reserve System—Purposes and Func­ Bank Credit-Card and Check-Credit Plans. 1968. 102 tions. 1974. 125 pp. pp. $1.00 each; 10 or more to one address, $.85 each. Annual Report. Survey of Changes in Family Finances. 1968. 321 pp. Federal Reserve Bulletin. Monthly. $20.00 per year or $1.00 each; 10 or more to one address, $.85 each. $2.00 each in the United States, its possessions, Canada, Report of the Joint Treasury-Federal Reserve Study and Mexico; 10 or more of same issue to one address, of the U.S. Government Securities Market. 1969. $18.00 per year or $1.75 each. Elsewhere, $24.00 per 48 pp. $.25 each; 10 or more to one address, $.20 each. year or $2.50 each. Joint Treasury-Federal Reserve Study of the Gov­ Banking and Monetary Statistics, 1914-1941. (Reprint ernment Securities Market: Staff Studies—Part of Part I only) 1976. 682 pp. $5.00. 1. 1970. 86 pp. $.50 each; 10 or more to one address, $.40 Banking and Monetary Statistics, 1941-1970. 1976. each. Part 2, 1971. 153 pp. and Part 3. 1973. 131 pp. Each 1,168 pp. $15.00. volume $1.00; 10 or more to one address, $.85 each. Annual Statistical Digest Open Market Policies and Operating Procedures— 1971-75. 1976. 339 pp. $4.00 per copy for each paid sub­ Staff Studies. 1971. 218 pp. $2.00 each; 10 or more to scription to Federal Reserve Bulletin; all others $5.00 one address, $1.75 each. each. Reappraisal of the Federal Reserve Discount Mecha­ 1972-76. 1977 . 377 pp. $10.00 per copy. nism. Vol. I. 1971. 276 pp. Vol. 2. 1971. 173 pp. Vol. 3. 1973-77. 1978. 361 pp. $12.00 per copy. 1972. 220 pp. Each volume $3.00; 10 or more to one ad­ 1974-78. 1980. 305 pp. $10.00 per copy. dress, $2.50 each. Federal Reserve Chart Book. Issued four times a year in The Econometrics of Price Determination Confer­ February, May, August, and November. Subscription ence, October 30-31, 1970, Washington, D.C. 1972. 397 includes one issue of Historical Chart Book. $7.00 per pp. Cloth ed. $5.00 each; 10 or more to one address, year or $2.00 each in the United States, its possessions, $4.50 each. Paper ed. $4.00 each; 10 or more to one ad­ Canada, and Mexico. Elsewhere, $10.00 per year or dress, $3.60 each. $3.00 each. Federal Reserve Staff Study: Ways to Moderate Historical Chart Book. Issued annually in Sept. Subscrip­ Fluctuations in Housing Construction. 1972 . 487 tion to Federal Reserve Chart Book includes one issue. pp. $4.00 each; 10 or more to one address, $3.60 each. $1.25 each in the United States, its possessions, Canada, Lending Functions of the Federal Reserve Banks. and Mexico; 10 or more to one address, $1.00 each. Else­ 1973. 271 pp. $3.50 each; 10 or more to one address, where, $1.50 each. $3.00 each. Capital Market Developments. Weekly. $15.00 per year Improving the Monetary Aggregates: Report of the or $.40 each in the United States, its possessions, Cana­ Advisory Committee on Monetary Statistics. da, and Mexico; 10 or more of same issue to one address, 1976. 43 pp. $1.00 each; 10 or more to one address, $.85 $13.50 per year or $.35 each. Elsewhere, $20.00 per year each. or $.50 each. Annual Percentage Rate Tables (Truth in Lending— Selected Interest and Exchange Rates—Weekly Se­ Regulation Z) Vol. I (Regular Transactions). 1969. 100 ries of Charts. Weekly. $15.00 per year or $.40 each in pp. Vol. II (Irregular Transactions). 1969. 116 pp. Each volume $1.00; 10 or more of same volume to one ad­ the United States, its possessions, Canada, and Mexico; dress, $.85 each. 10 or more of same issue to one address, $13.50 per year or $.35 each. Elsewhere, $20.00 per year or $.50 each. Federal Reserve Measures of Capacity and Capacity The Federal Reserve Act, as amended through December Utilization. 1978. 40 pp. $1.75 each; 10 or more to one address, $1.50. each. 1976, with an appendix containing provisions of certain other statutes affecting the Federal Reserve System. 307 The Bank Holding Company Movement to 1978: A pp. $2.50. Compendium. 1978. 289 pp. $2.50 each; 10 or more to one address, $2.25 each. Regulations of the Board of Governors of the Fed­ Improving the Monetary Aggregates: Staff Papers. eral Reserve System 1978. 170 pp. $4.00 each; 10 or more to one address, Published Interpretations of the Board of Gover­ $3.75 each. nors, as of Dec. 31, 1979. $7.50. 1977 Consumer Credit Survey. 1978. 119 pp. $2.00 each. Industrial Production: 1976 Edition. 1977. 304 pp. $4.50 Flow of Funds Accounts. 1949-1978. 1979. 171 pp. each; 10 or more* to one address, $4.00 each. $1.75 each; 10 or more to one address, $1.50 each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A79 Consumer Education Pamphlets Short pamphlets suitable for classroom use. Multiple copies available without charge. Alice in Debitland Measurement of Capacity Utilization: Problems and The Board of Governors of the Federal Reserve System Tasks, by Frank de Leeuw, Lawrence R. Forest, Jr., Consumer Handbook To Credit Protection Laws Richard D. Raddock, and Zoltan E. Kenessey. July 1979. The Equal Credit Opportunity Act and . . . Age 264 pp. The Equal Credit Opportunity Act and . . . Credit Rights in The Market for Federal Funds and Repurchase Housing Agreements, by Thomas D. Simpson. July 1979. 106 pp The Equal Credit Opportunity Act and . . . Doctors, Impact of Bank Holding Companies on Competition Lawyers, Small Retailers, and Others Who May Provide and Performance in Banking Markets, by Stephen Incidental Credit A. Rhoades and Roger D. Rutz. Aug. 1979. 30 pp. The Equal Credit Opportunity Act and . . . Women The GNMA-Guaranteed Passthrough Security: Mar­ Fair Credit Billing ket Development and Implications for the Growth The Federal Open Market Committee and Stability of Home Mortgage Lending, by Federal Reserve Bank Board of Directors David F. Seiders. Dec. 1979. 65 pp. Federal Reserve Banks Federal Reserve Glossary Printed in Full in the Bulletin How to File A Consumer Credit Complaint An Assessment of Bank Holding Companies, by If You Borrow To Buy Stock Robert J. Lawrence and Samuel H. Talley. January 1976. If You Use A Credit Card Truth in Leasing U.S. Currency What Truth in Lending Means to You Reprints Except for Staff Studies, and some leading articles, most Staff Studies of the articles reprinted do not exceed 12 pages. Studies and papers on economic and financial subjects that are of general interest. Measures of Security Credit. 12/70. Revision of Bank Credit Series. 12/71. Summaries Only Printed in the Bulletin Assets and Liabilities of Foreign Branches of U.S. Banks. Requests to obtain single copies of the full text or to be 2/72. added to the mailing list for the series may be sent to Pub­ Bank Debits, Deposits, and Deposit Turnover—Revised lications Services. Series. 7/72. Yields on Newly Issued Corporate Bonds. 9/72. Interest Rate Ceilings and Disintermediation, by Ed­ Yields on Recently Offered Corporate Bonds. 5/73. ward F. McKelvey. Sept. 1978. 105 pp. Rates on Consumer Instalment Loans. 9/73. The Relationship Between Reserve Ratios and the New Series for Large Manufacturing Corporations. 10/73. Monetary Aggregates Under Reserves and Fed­ The Structure of Margin Credit. 4/75. eral Funds Rate Operating Targets, by Kenneth J. Industrial Electric Power Use. 1/76. Kopecky. Dec. 1978. 58 pp. Revision of Money Stock Measures. 2/76. Tie-ins Between the Granting of Credit and Sales of Revised Series for Member Bank Deposits and Aggregate Re­ Insurance by Bank Holding Companies and Other serves. 4/76. Lenders, by Robert A. Eisenbeis and Paul R. Schweitzer. Industrial Production— 1976 Revision. 6/76. Feb. 1979. 75 pp. Federal Reserve Operations in Payment Mechanisms: A Geographic Expansion of Banks and Changes in Bank­ Summary. 6/76. ing Structure, by Stephen A. Rhoades. Mar. 1979. 40 New Estimates of Capacity Utilization: Manufacturing and pp. Materials. 11/76. Impact of the Dollar Depreciation on the U.S. Price The Commercial Paper Market. 6/77. Level: An Analytical Survey of Empirical Esti­ The Federal Budget in the 1970’s. 9/78. mates, by Peter Hooper and Barbara R. Lowrey. Apr. Redefining the Monetary Aggregates. 1/79. 1979. 53 pp. Implementation of the International Banking Act. 10/79. Innovations in Bank Loan Contracting: Recent Evi­ Changes in Bank Lending Practices, 1977-79. 10/79. dence by Paul W. Boltz and Tim S. Campbell. May 1979. U.S. International Transactions in 1979: Another Round of 40 pp. Oil Price Increases. 4/80. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A80 Anticipated Schedule of Release Dates for Public Periodic Releases-B oard of Governors of the Federal Reserve System1 Date or Period Approximate to which Data Weekly Release Release Day2 Refer Aggregate Reserves and Member Bank Deposits. H.3 (502) Tuesday Week ended previous Wednesday Actions of the Board; Applications and Reports H.2 (501) Friday Week ended previous Saturday Assets and Liabilities of All Commercial Banks in the United States. Wednesday Wednesday, 2 weeks H.8 (510) earlier Changes in State Member Banks. K.3 (615) Tuesday Week ended previous Saturday Deposits, Reserves, and Borrowings of Member Banks. H.7 (509) Wednesday Week ended 3 Wednes­ days earlier Factors Affecting Bank Reserves and Condition Statement of Federal Thursday Week ended previous Reserve Banks. H.4.1 (503) Wednesday Foreign Exchange Rates. H. 10 (512) Monday Week ended previous Friday Money Stock Measures. H.6 (508) Thursday Week ended Wednes­ day of previous week Selected Borrowings in Immediately Available Funds of Large Member Wednesday Week ended Wednes­ Banks. H.5 (507) day of previous week Selected Interest Rates. H. 15 (519) Monday Week ended previous Saturday Weekly Consolidated Condition Report of Large Commercial Banks Wednesday Wednesday, 1 week and Domestic Subsidiaries. H.4.2 (504) earlier Weekly Summary of Banking and Credit Measures. H.9 (511) Thursday Week ended previous Wednesday; and week ended Wednes­ day of previous week Monthly Releases Capacity Utilization: Manufacturing and Materials. G.3 (402) 17th of month Previous month Changes in Status of Banks and Branches. G.4.5 (404) 25th of month Previous month Commercial and Industrial Loans to U.S. Addresses Excluding Bank­ 1st Wednesday of Last Wednesday of pre­ ers’ Acceptances and Commercial Paper by Industry. G.27 (429) month vious month Consumer Installment Credit. G. 19 (421) 3rd working day of 2nd month previous month Debits and Deposit Turnover at Commercial Banks. G.6 (406) 25th of month Previous month Federal Reserve System Memorandum on Exchange Charges. K.14 5th of month Period since last release (628) Finance Companies. G.20 (422) 5th working day of 2nd month previous month 1 The Board’s official mailing list is being computerized, and three-digit identification codes have been assigned to each individual release. 2 Release dates are those anticipated or usually met. However, it should be noted that for some releases there is normally a certain variability because of reporting or processing procedures. Moreover, for all series unusual circumstances may, from time to time, result in a release date being later than anticipated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A81 Date or Period Approximate to which Data Release Day Refer Foreign Exchange Rates. G.5 (405) 1st of month Previous month Industrial Production. G.12.3 (414) 15th of month Previous month Loan Commitments at Selected Large Commercial Banks. G.21 (423) 20th of month 2nd month previous Loans and Investments at all Commerical Banks. G.7 (407) 20th of month Previous month Major Nondeposit Funds of Commercial Banks. G. 10 (411) 20th of month Previous month Maturity Distribution of Outstanding Negotiable Time Certificates of 24th of month Last Wednesday of pre­ Deposit. G.9(410) vious month Monthly Report of Condition for U.S. Agencies, Branches, and Domes­ 15th of month 2nd month previous tic Banking Subsidiaries of Foreign Banks. G. 11 (412) Research Library—Recent Acquisitions. G.15 (417) 1st of the month Previous month Selected Interest Rates. G.13 (415) 6th of month Previous month Summary of Equity Security Transactions. G.16 (418) Last week of month Release date Quarterly Releases Automobile Credit E.4 (114) 14th of April, July, Previous quarter October, and Jan­ uary Finance Rates and Other Terms on Selected Types of Consumer Install­ 25 th of January, 2nd month previous ment Credit Extended by Major Finance Companies. E. 10 (120) April, July, and October Flow of Funds: Seasonally adjusted and unadjusted. Z.l (780) 15th of February, Previous quarter May, August, and November Geographical Distribution of Assets and Liabilities of Major Foreign 15th of March, Previous quarter Branches of U.S. Banks. E.ll (121) June, September, and December Interest Rates on Selected Consumer Installment Loans at Reporting 15th of March, February, May, Au­ Commercial Banks. E. 12 (122) June, September, gust, and November and December Survey of Terms of Bank Lending. E.2 (111) 15th of March, February, May, Au­ June, September, gust, and November and December Semiannual Releases Assets and Liabilities of Commercial Banks, by Class of Bank. E.3.4 May and November End of previous De­ (113) cember and June Check Collection Services—Federal Reserve System. (E.9) 119 February and July Previous 6 months List of OTC Margin Stocks. E.7 (117) April and October Release date Assets, Liabilities, and Capital Accounts of Commercial and Mutual May and November End of previous De­ Savings Banks—Reports of Call (Joint Release of the Federal Deposit cember and June Insurance Corporation, the Board of Governors of the Federal Re­ serve System, and Office of the Comptroller of the Currency. Pub­ lished and distributed by FDIC.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A82 Date or Period Approximate to which Data Release Day Refer Annual Releases Aggregate Summaries of Annual Surveys of Security Credit Extension. February End of previous June C.2 (101) Bank Holding Companies and Subsidiary Banks. C.6 (105) March Previous year Insured Bank Income by Size of Bank. C.4 (103) End of May Previous year State Member Banks of Federal Reserve System and Nonmember 1st quarter of year End of previous year Banks that Maintain Clearing Accounts with Federal Reserve Banks. G.4 (403) (Supplements issued monthly) 15th of month Previous month ORDER FORM □ Send latest issue of the item(s) checked above. □ Add to mailing list for periodic releases checked above. (Please allow six weeks for additions or changes on mailing lists.) □ A remittance of $ ________is enclosed. Name Organization Street Address City State Zip Code Country Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A83 Index to Statistical Tables References are to pages A-3 through A-72 although the prefix “A” is omitted in this index ACCEPTANCES, bankers, 10, 25, 27 Deposits (See also specific types) Agricultural loans, commercial banks, 18,20-22, 26 Banks, by classes, 3, 16, 17, 19, 20-23, 29, 69-72 Assets and liabilities (See also Foreigners) Federal Reserve Banks, 4, 11 Banks, by classes, 16, 17, 18,20-23,29 Subject to reserve requirements, 14 Domestic finance companies, 39 Turnover, 12 Federal Reserve Banks, 11 Discount rates at Reserve Banks (See Interest rates) Nonfinancial corporations, current, 38 Discounts and advances by Reserve Banks (See Loans) Automobiles Dividends, corporate, 37 Consumer installment credit, 42,43 Production, 48,49 EMPLOYMENT, 46, 47 Eurodollars, 27 BANKERS balances, 16, 18, 20, 21, 22 (See also Foreigners) Banks for Cooperatives, 35 FARM mortgage loans, 41 Bonds (See also U.S. government securities) Farmers Home Administration, 41 New issues, 36 Federal agency obligations, 4, 10, 11, 12, 34 Yields, 3 Federal and federally sponsored credit agencies, 35 Branch banks Federal finance Assets and liabilities of foreign branches of U.S. banks, 56 Debt subject to statutory limitation and types and Liabilities of U.S. banks to their foreign branches, 23 ownership of gross debt, 32 Business activity, 46 Receipts and outlays, 30, 31 Business expenditures on new plant and equipment, 38 Treasury operating balance, 30 Business loans (See Commercial and industrial loans) 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 Corporation, 35,40,41 Banks, by classes, 16, 17, 19,20 Federal Housing Administration, 35,40,41 Federal Reserve Banks, 11 Federal Intermediate Credit Banks, 35 Central banks, 68 Federal Land Banks, 35,41 Certificates of deposit, 23, 27 Federal National Mortgage Association, 35,40,41 Commercial and industrial loans Federal Reserve Banks Commercial banks, 15, 18,26 Condition statement, 11 Weekly reporting banks, 20,21,22, 23,24 Discount rates (See Interest rates) Commercial banks U.S. government securities held, 4, 11, 12, 32, 33 Assets and liabilities, 3, 15-19, 20-23, 69-72 Federal Reserve credit, 4, 5, 11, 12 Business loans, 26 Federal Reserve notes, 11 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, 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 installment credit, 42,43 Foreign Consumer prices, 46, 51 Currency operations, 11 Consumption expenditures, 52, 53 Deposits in U.S. banks, 4, 11, 19, 20, 21, 22 Corporations Exchange rates, 68 Profits, taxes, and dividends, 37 Trade,55 Security issues, 36,65 Foreigners Cost of living (See Consumer prices) Claims on, 56, 58, 61, 62, 63,67 Credit unions, 29,42,43 Liabilities to, 23, 56-60, 64-66 Currency and coin, 5, 16,18 Currency in circulation, 4, 13 GOLD Customer credit, stock market, 28 Certificates, 11 Stock, 4,55 DEBITS to deposit accounts, 12 Government National Mortgage Association, 35,40,41 Debt (See specific types of debt or securities) Gross national product, 52, 53 Demand deposits Adjusted, commercial banks, 12, 15, 19 HOUSING, new and existing units, 50 Banks, by classes, 16, 17,19,20-23 Ownership by individuals, partnerships, and INCOME, personal and national, 46,52, 53 corporations, 25 Industrial production, 46,48 Subject to reserve requirements, 14 Installment loans, 42,43 Turnover, 12 Insurance companies, 29, 32, 33,41 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A84 Insured commercial banks, 17, 18, 19, 69-72 Real estate loans—Continued Interbank loans and deposits, 16, 17 Life insurance companies, 29 Interest rates Mortgage terms, yields, and activity, 3,40 Bonds, 3 Type of holder and property mortgaged, 41 Business loans of banks, 26 Repurchase agreements and federal funds, 6 Federal Reserve Banks, 3, 7 Reserve requirements, member banks, 8 Foreign countries, 68 Reserves Money and capital markets, 3, 27 Commercial banks, 16, 18,20,21,22 Mortgages, 3,40 Federal Reserve Banks, 11 Prime rate, commercial banks, 26 Member banks, 3, 4, 5, 14, 16, 18 Time and savings deposits, 9, 72 U.S. reserve assets, 55 International capital transactions of the United States, 56-67 Residential mortgage loans, 40 International organizations, 56-61,64-67 Retail credit and retail sales, 42,43,46 Inventories, 52 Investment companies, issues and assets, 37 SAVING Investments (See also specific types) Flow of funds, 44, 45 Banks, by classes, 16, 17, 18,20,21,22,29 National income accounts, 53 Commercial banks, 3, 15, 16, 17,18 Savings and loan assns., 3, 9, 29, 33, 41, 44 Federal Reserve Banks, 11, 12 Savings deposits (See Time deposits) Life insurance companies, 29 Savings institutions, selected assets, 29 Savings and loan associations, 29 Securities (See also U.S. government securities) Federal and federally sponsored agencies, 35 LABOR force, 47 Foreign transactions, 65 Life insurance companies (See Insurance companies) New issues, 36 Loans (See also specific types) Prices, 28 Banks, by classes, 16, 17, 18, 20-23, 29 Special drawing rights, 4, 11, 54, 55 Commercial banks, 3, 15-18, 20-23,24, 26 State and local governments Federal Reserve Banks, 3, 4, 5, 7, 11, 12 Deposits, 19, 20, 21, 22 Insurance companies, 29,41 Holdings of U.S. government securities, 32, 33 Insured or guaranteed by United States, 40,41 New security issues, 36 Savings and loan associations, 29 Ownership of securities of, 18, 20, 21, 22, 29 Yields of securities, 3 MANUFACTURING State member banks, 17 Capacity utilization, 46 Stock market, 28 Production, 46,49 Stocks (See also Securities) Margin requirements, 28 New issues, 36 Member banks Prices, 28 Assets and liabilities, by classes, 16, 17, 18 Borrowings at Federal Reserve Banks, 5, 11 TAX receipts, federal, 31 Federal funds and repurchase agreements, 6 Time deposits, 3, 9, 12, 14, 16, 17, 19, 20, 21, 22, 23, 69-72 Number, by classes, 16, 17, 19 Trade, foreign, 55 Reserve requirements, 8 Treasury currency, Treasury cash, 4 Reserves and related items, 3,4, 5, 14 Treasury deposits, 4, 11, 30 Mining production, 49 Treasury operating balance, 30 Mobile home shipments, 50 Monetary aggregates, 3, 14 UNEMPLOYMENT, 47 Money and capital market rates (See Interest rates) U.S. balance of payments, 54 Money stock measures and components, 3, 13 U.S. government balances Mortgages (See Real estate loans) Commercial bank holdings, 19,20,21,22 Mutual funds (See Investment companies) Member bank holdings, 14 Mutual savings banks, 3, 9, 20-22, 29, 32, 33, 41 Treasury deposits at Reserve Banks, 4, 11, 30 U.S. government securities NATIONAL banks, 17 Bank holdings, 16, 17, 18,20,21,22,29, 32,33 National defense outlays, 31 Dealer transactions, positions, and financing, 34 National income, 52 Federal Reserve Bank holdings, 4, 11, 12, 32, 33 Nonmember banks, 17, 18, 19 Foreign and international holdings and transactions, 11, 32, 64 OPEN market transactions, 10 Open market transactions, 10 Outstanding, by type and ownership, 32, 33 PERSONAL income, 53 Rates, 3,27 Prices Utilities, production, 49 Consumer and producer, 46, 51 Stock market, 28 VETERANS Administration, 40,41 Prime rate, commercial banks, 26 Production, 46,48 WEEKLY reporting banks, 20-24 Profits, corporate, 37 Wholesale prices, 46, 51 REAL estate loans YIELDS (See Interest rates) Banks, by classes, 18, 20-22,29,41 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A85 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories Minneapolis Detroit Chicago $ 8 % jSa/t lake City J J Wn X\Clsco Denver Kansas Louisvil t. Louis tfichjnojl Charlotte, \Oklahoma Cit) Sashvilli ittle Rock Birminghai\ A ® tla nta > Dallas<g> Houston! tan Antonio January 1978 ALASKA HAWAII Legend ~ " Boundaries of Federal Reserve Districts ® Federal Reserve Bank Cities Boundaries of Federal Reserve Branch • Federal Reserve Branch Cities Territories * Federal Reserve Bank Facility o Board of Governors of the Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis