Federal Reserve Bulletin, 1980-11

VOLUME 66 • NUMBER 11 • NOVEMBER 1980 FEDERAL RESERVE BULLETIN Board of Governors of the Federal Reserve System Washington, D.C. PUBLICATIONS COMMITTEE Joseph R. Coyne, Chairman • Stephen H. Axilrod • John M. Denkler Janet O. Hart • James L. Kichline • Neal L. Petersen • Edwin M. Truman Naomi P. Salus, Coordinator 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. The artwork is provided by the Graphic Communications Section under the direction of 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 871 DOMESTIC FINANCIAL DEVELOPMENTS 883 RECORD OF POLICY ACTIONS OF THE IN THE THIRD QUARTER OF 1980 FEDERAL OPEN MARKET COMMITTEE The growth of money and credit during the At its meeting on September 16, 1980, the period was due in large part to the rebound Committee agreed that open market operain economic activity, the continued rapid tions in the period until the next meeting increase in prices, and the marked decline should be directed toward expansion of rein interest rates in the second quarter. serve aggregates consistent with growth of M-1A, M-1B, and M-2 over the August-to- December period at annual rates of about 4 percent, 6V2 percent, and 8V2 percent re- 879 INDUSTRIAL PRODUCTION spectively, provided that in the period be- Output increased about 1.6 percent in Sep- fore the next regular meeting the weekly tember. average federal funds rate remained within a range of 8 to 14 percent. 881 ANNOUNCEMENTS 889 LEGAL DEVELOPMENTS Amendments to Regulation D that include Amendments to and interpretations of Regthe expanded use of simplified procedures ulations D, K, and Q; revision of Regulaunder the reporting and reserve require- tion J; Depository Institutions Deregulation ment provisions of the Monetary Control Committee rules; various bank holding Act. (See Legal Developments.) company and bank merger orders; and pending cases. Modification of Regulation J, which deals with check collection and wire transfer of AI FINANCIAL AND BUSINESS STATISTICS funds. (See Legal Developments.) Interpretation of Regulation Q concerning A67 GUIDE TO TABULAR PRESENTATION, fixed-rate obligations of bank holding com- STATISTICAL RELEASES, AND SPECIAL panies, and amendment that reduces the TABLES minimum maturity of time deposits at member banks to 14 days. (See Legal De- A68 BOARD OF GOVERNORS AND STAFF velopments.) A70 FEDERAL OPEN MARKET COMMITTEE Availability of information summarizing AND STAFF; ADVISOR YCOUNCILS the categories of depositors eligible to hold negotiable order of withdrawal accounts at All FEDERAL RESERVE BANKS, member banks. BRANCHES, AND OFFICES Proposal of policy statement on payments to brokers for research and brokerage serv- All FEDERAL RESER VE BOARD ices by trust institutions. PUBLICATIONS Change in Board staflF. A74 INDEX TO STATISTICAL TABLES Admission of ten state banks to membership in the Federal Reserve System. A76 MAP OF FEDERAL RESER VE S YSTEM Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments in the Third Quarter of 1980 This report, which was sent to the Joint Econom- The large increase in the narrow monetary agic Committee of the U.S. Congress on November gregates, M-1A and M-1B, during the summer 6, 1980, highlights the important developments appears primarily to have been a normal rein domestic financial markets during the summer sponse of the public's demand for transactions and early fall. balances to changes in economic activity, prices, and interest rates. However, there appears also Money and credit grew rapidly during the third to have been some retracing of the second-quarquarter following the exceptional weakness of ter shortfall from historical money demand patthe preceding three months. The expansion was terns. Average third-quarter levels for both associated in large part with the turnaround in M-1A and M-1B were consistent with the ranges economic activity, the continued rapid increase set by the Federal Open Market Committee for in prices, and the marked decline in interest rates growth from the fourth quarter of 1979 to the during the second quarter. In addition, the phas- fourth quarter of 1980. The average level of M-2 ing out of the Federal Reserve's credit control for the third quarter, however, was slightly above measures—completed in July—may have con- the upper bound of its longer-run range, buoyed tributed to a resurgence of borrowing, especially by a surge in the nontransactions component. by the household sector. M-3 remained below the upper end of its range, Interest rates Percent per annum 20 SHORT-TERM | LONG TERM Federal funds Conventional mortgages HUD Aaa utility bonds New issues U.S. government Treasury bills bonds 3-month State and local Federal Reserve discount rate M ^ P R M b o n* BHHHHHHH Monthly averages except for Federal Reserve discount rate and con- and Urban Development; Aaa utility bonds, weighted averages of new ventional mortgages (based on quotations for one day each montK). publicly offered bonds rated Aaa, Aa, and A by Moody's Investors Yields: U.S. Treasury bills, market yields on three-month issues; Service and adjusted to Aaa basis; U.S. government bonds, market prime commercial paper, dealer offering rates; conventional mort- yields adjusted to 20-year constant maturity by U.S. Treasury; state gages, rates on first mortgages in primary markets, unweighted and and local government bonds (20 issues, mixed quality), Bond Buyer. rounded to nearest 5 basis points, from U.S. Department of Housing Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

872 Federal Reserve Bulletin • November 1980 Changes in selected monetary aggregates1 Based on seasonally adjusted data unless otherwise noted, in percent 1979 1980 IItteemm 11997777 11997788 11997799 Q3 Q4 Qi Q2 Q3 Member bank reserves2 Total 5.0 6.6 2.9 5.3 12.3 4.3 1.0 6.9 Nonborrowed 2.6 6.7 .7 7.3 6.2 3.4 7.6 12.2 Monetary base3 8.2 9.2 7.7 9.5 9.5 7.6 5.2 9.8 Concepts of money4 M-1A 7.7 7.4 5.0 7.8 4.5 4.8 -3.9 11.0 M-1B 8.1 8.2 7.6 9.6 5.0 5.9 -2.4 13.4 M-2 11.5 8.4 8.9 10.7 7.1 7.2 5.5 15.4 M-3 12.6 11.3 9.8 10.8 9.1 7.8 5.7 12.6 Nontransaction components of M-2 Total (M-2 minus M-IB) 12.8 8.5 9.4 11.1 7.8 7.7 8.1 16.1 Small time deposits 15.1 16.2 23.1 14.7 25.8 18.3 24.8 2.0 Savings deposits 9.8 -.5 -12.0 -1.2 -21.6 -21.1 -25.1 25.6 Money market mutual fund shares5 5.9 163.9 324.2 166.2 120.0 151.9 82.7 75.7 Overnight RPs and overnight Eurodollar deposits5 42.5 25.4 17.2 11.3 -33.1 -7.5 -72.0 132.7 MEMO (change in billions of dollars) Managed liabilities at commercial banks 27.8 73.5 59.7 17.9 8.6 10.6 -3.2 -12.0 Large time deposits, gross 19.2 50.4 19.6 2.4 10.7 6.4 5.9 -5.0 Nondeposit funds 8.6 23.1 40.1 15.5 -2.1 4.2 -9.1 -7.0 Net due to foreign related institutions -3.8 6.6 25.2 8.9 .1 -2.3 -8.5 -12.1 Other6 12.4 16.5 15.0 6.6 -2.1 6.4 -.6 5.1 U.S. government deposits at commercial banks -.2 3.3 1.5 5.0 -4.0 1.6 -1.6 2.7 1. Changes are calculated from the average amounts outstanding in M-2 is M-1B plus overnight repurchase agreements (RPs) issued by each quarter. commercial banks, overnight Eurodollar deposits held by U.S. non- 2. Annual rates of change in reserve measures have been adjusted bank residents at Caribbean branches of U.S. banks, money market for regulatory changes in reserve requirements. mutual fund shares, and savings and small time deposits at all deposi- 3. Consists of total reserves (member bank reserve balances in the tory institutions. M-3 is M-2 plus large time deposits at all depository current week plus vault cash held two weeks earlier), currency in cir- institutions and term RPs issued by commercial banks and savings and culation (currency outside the U.S. Treasury, Federal Reserve Banks, loan associations. For more information on the redefined monetary and the vaults of commercial banks), and vault cash of nonmember aggregates, see the FEDERAL RESERVE BULLETIN, vol. 66 (February banks. 1980), pp. 97-114. 4. M-1A is currency plus private demand deposits net of deposits 5. Not seasonally adjusted. due to foreign commercial banks and official institutions. M-1B is 6. Consists of borrowings from other than commercial banks M-1A plus other checkable deposits (negotiable order of withdrawal through federal funds purchased and securities sold under repurchase accounts, accounts subject to automatic transfer service, credit union agreements plus loans sold to affiliates, loans sold under repurchase share draft balances, and demand deposits at mutual savings banks). agreements, and other borrowings. while bank credit fell short of the lower limit of As the quarter progressed, the more rapid its long-run range. growth in money and credit, as well as intensified With prospects for employment and real in- concerns about inflation and federal deficit come improving over the quarter and with inter- spending, was reflected in an upturn in interest est rates lower than in the spring, borrowing by rates in money and capital markets. Short-term the household sector strengthened. The con- interest rates began to rise steeply in August and traction in consumer installment debt came to a by early October had increased about 4 percenthalt and home mortgage financing increased. age points above June lows. With the accelera- Nonfinancial businesses also raised a greater vol- tion in deposit growth, the provision of nonume of funds in credit markets than in the second borrowed reserves increasingly fell short of bank quarter; as credit demands picked up and market reserve needs, putting upward pressure on the interest rates began to rise, many large firms that federal funds rate; in late September, the funds had relied more heavily on commercial paper and rate rose above 103/4 percent and member bank bond financing in the spring shifted their credit borrowing from the Federal Reserve increased demands back to commercial banks. Borrowing appreciably. To help curb the growth in the monby the U.S. Treasury and by state and local gov- etary aggregates, the Federal Reserve increased ernments increased sharply from the first-half the discount rate from 10 to 11 percent! The pace. prime rate at large banks was raised in several Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q3 1980 873 steps to 14 percent in mid-October, as these in- after market yields had moved up considerably, stitutions responded to rising costs of funds and small time deposits again attracted funds, and increased loan demand. Intermediate- and long- growth in savings deposits slowed. er-term interest rates increased between 2 and 3 Net inflows to small-denomination time depospercentage points from their mid-June lows. In its over the quarter were accounted for entirely mortgage markets, interest rates moved up IV2 by growth of variable-ceiling 2V2-year small-savpercentage points to more than 133A percent in er certificates (SSCs); interest rate ceilings on mid-October. The rise in domestic interest rates such certificates have been above those on sixover the quarter contributed to a strengthening of month money market certificates (MMCs) since the value of the dollar in foreign exchange mar- May. Growth in SSCs at thrift institutions exkets. ceeded that at commercial banks, reflecting the V4-percentage-point-higher ceiling available on such accounts at the thrift institutions. MMCs, MONETAR Y AGGREGATES which had attracted most consumer deposits in AND BANK CREDIT the first half of the year, declined during the third quarter, as did fixed-ceiling deposits. By the end All of the major monetary aggregates strength- of the quarter, however, yields on shorter maturened markedly during the third quarter. A sub- ity instruments were approaching those on the stantial resurgence in demand deposits boosted longer maturity SSC accounts; moreover, in growth in M-1A to an annual rate of 11 percent, early October the "cap" on SSC rates became following a record decline in the previous quar- effective for the first time since last April, reducter. M-1B expanded at a 13V2 percent rate, ing the attractiveness of those accounts relative to buoyed further by continued rapid growth of market instruments. [The SSC ceiling is set bicheckable deposits other than commercial bank weekly. Market yields on 2V2-year Treasury obdemand accounts. Commercial banks appear to ligations during the five business days preceding have marketed interest-bearing transactions bal- each biweekly period provide the base rate; savances more aggressively, perhaps in anticipation ings and loan associations and mutual savings of greater competition for such balances after banks may offer up to that base rate, and com- January 1, 1981, when all depository institutions mercial banks may offer up to XU percentage will be permitted to offer NOW (negotiable order point less. When the base rate equals or exceeds of withdrawal) accounts. M-2 grew at a 15V2 per- 12 percent, however, thrift institutions are recent rate during the third quarter, as growth in stricted to 12 percent and commercial banks to the nontransactions component of that aggregate ll3/4 percent.] accelerated in July from its second-quarter pace On average over the third quarter, money marbefore slackening in August and September. ket mutual fund (MMMF) shares grew at close to A noteworthy development within the non- the same rapid pace as in the second quarter. The transactions component of M-2 was the renewed 40- to 50-day average maturity of MMMF asset inflow of funds to passbook savings accounts. portfolios slowed the response of shareholder re- After nearly a year of outflows, passbook ac- turns to rising open market yields, however, and counts at all types of depository institutions grew in September MMMF shares contracted $274 bilduring July and August at an annual rate of near- lion. Most of the decline in shares occurred at ly 33 percent. Although interest rates on such de- funds catering only to large investors (generally posits remained well below open market yields, institutions) although inflows to other funds also the gap had narrowed substantially during the slowed. spring, and given the prevailing economic and fi- The growth rate of M-3 was slightly less than nancial uncertainties, savers were attracted to that of M-2 in the third quarter, as total largethese highly liquid instruments. At the same denomination time deposits at commercial banks time, growth of less liquid small-denomination and thrift institutions contracted. Much of the time deposits dropped to a negligible rate, fol- runoff in large time deposits occurred in July and lowing brisk expansion in the first half of the August when core deposits at the institutions year. In September and early October, however, were expanding rapidly. As core deposit growth Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

874 Federal Reserve Bulletin • November 1980 slowed late in the quarter, issuance of large- Components of Major categories of denomination time deposits increased. bank credit bank loans Reflecting the strong expansion of deposits, Change, billions of dollars growth in required reserves of banks accelerated TREASURY SECURITIES as the quarter progressed. The provision of nonborrowed reserves fell substantially short of J=L bank needs, and borrowings from the Federal Reserve discount window increased from just OTHER SECURITIES nnnnn under $400 million at the beginning of the quarter to more than $1.3 billion in September.1 As member bank reserve positions tightened, the federal AL LOANS funds rate moved above the discount rate in late August for the first time since April. The discount rate was increased a full percentage point on September 26. Growth in bank credit rebounded to an annual CONSUMER rate of 13 V2 percent in the third quarter, following the second-quarter contraction, as banks, no n n longer subject to the special credit restraint pro- n u gram, met the increased credit demands of businesses and households. By the end of the quar- HBHHHHH1 ter, all major components of bank loan portfolios, except consumer loans, had ex- NONBANK FINANCIAL panded. And although consumer loans continued mm u 16 to decline, the rate of contraction slowed as the quarter progressed. Growth in real estate loans 24 1 picked up after a stagnant second quarter to a 5V2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 1979 1980 1979 1980 percent rate of increase in the third. Business loans grew at a 16 percent annual rate, following Seasonally adjusted. Total loans and business loans are adjusted for transfers between banks and their holding companies, affiliates, suba 9 percent rate of decline in the second quarter. sidiaries, or foreign branches. As market interest rates rose, banks increased the prime rate less rapidly, resulting in a more With deposit growth strengthening, banks retypical relationship among these rates than was duced their managed liabilities $12 billion over evident in the second quarter. the third quarter, with the greatest reductions In addition to increased loan growth, banks en- continuing to be in net liabilities to their foreign larged their holdings of U.S. Treasury securities affiliates. Since April, the cost of Eurodollar at an annual rate of nearly 40 percent in the third funds has exceeded domestic rates (adjusted for quarter. In part, this expansion may have reflect- reserve requirements), thus encouraging this pated additions to required collateral associated tern of behavior. Domestically issued managed with large increases in the U.S. government de- liability instruments of banks, in contrast, rose in posits and in repurchase agreements. the third quarter. 1. As shown in the table on page 872, the growth in nonborrowed reserves accelerated in the third quarter when growth BUSINESS FINANCE rates are measured on a quarterly average basis. These quarterly average figures, however, obscure the actual pattern of Total funds raised by nonfinancial businesses in reserve movements since March. In particular, nonborrowed reserves were quite low on average in the second quarter be- the debt and equity markets increased somewhat cause of the low level in April. But the pace of nonborrowed in the third quarter from the depressed secondreserve provision picked up in April, and was quite rapid in quarter pace. The volume of financing, however, May and June. In July the growth slowed markedly and remained low in the remainder of the quarter. remained below that of 1979 and early 1980, as Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q3 1980 875 the reduction of inventories reduced corporate standing. Total nonfinancial commercial paper needs for external funds. The pickup in financing contracted $2.4 billion in the third quarter, the in the third quarter occurred as nonfinancial busi- first quarterly decline since the fourth quarter of nesses returned to debt and equity markets to 1977. meet a more normal portion of funding require- The drop in commercial paper and the pickup ments, after having relied extensively on the liq- in bank borrowing by businesses reflected in part uidation of short-term financial assets in the sec- the narrowing of the spread between the bank ond quarter of the year. The increase in business prime rate and the commercial paper rate. The borrowing was primarily from short- and inter- fall in the prime rate to 11 percent in July signifimediate-term sources, with a rise in bank bor- cantly reduced the difference between these rowing more than offsetting a decline in out- rates from the gap of almost ll12 percentage standing commercial paper. In the long-term points that had developed in May. Through most markets, net bond sales by nonfinancial busi- of the quarter, commercial paper rates rose relanesses were down slightly, while equity issuance tively more than the prime rate, further narrowrebounded in a favorable environment of rising ing the spread. According to a survey, moreover, stock prices. large regional banks increased the proportion of Net extensions of loans to businesses by banks their short-term business loans made at rates betotaled $12 billion in the third quarter, with most low prime during this period. As a result, some of the growth occurring in August and Septem- issuers of commercial paper turned to banks for ber; this growth followed a contraction of almost shorter-term financing. Bank borrowing also may $7 billion in such loans during the second quar- have been substituted for longer-term debt issues ter. Overall, short- and intermediate-term bor- in the latter part of the quarter, as suggested by rowing by businesses increased somewhat less the marked falloff in public bond offerings when than bank credit in the third quarter because of interest rates rose. the sharp decline in commercial paper out- Notes and bonds offered publicly by all corporations totaled $47 billion at an annual rate in the third quarter, about two-thirds of the record vol- Business loans and short- and intermediate-term business credit ume of the previous quarter. Reduced issuance Seasonally adjusted annual rates of change, in percent1 of long-term debt by nonfinancial businesses, which totaled $38 billion, accounted for half of Short- and Period Bu a si t n b e a ss n k lo s a 2 ns in b t u er s m in e e d ss ia c t r e e -t d e i r t m 3 n th a e n c d ia ec l li c n o e n i c n e r t n h s e t a o l t s a o l f v e o ll l um sh e a , r p b l u y t f is o s l u lo e w s in of g fi a - 1974 19.3 23.5 surge in the second quarter. The heaviest is- 1975 -3.8 -4.0 suance of bonds occurred early in the quarter; 1976 1.3 4.4 1977 10.5 13.6 the upward movement in corporate bond yields 1978 16.3 18.3 1979 17.5 20.0 as the quarter progressed resulted in a sharply 1979-Q1 20.5 20.8 reduced pace of public offerings by both financial Q2 16.6 20.1 and nonfinancial firms; September's volume was Q3 22.7 27.4 Q4 6.0 6.4 the smallest since March. At the end of Septem- 1980-Q1 16.4 22.0 ber the Federal Reserve index of yields on newly Q2 -9.1 1.2 Q3 16.le 9.2e issued, Aaa-rated utility bonds was above 13 percent, 2V2 percentage points above its mid-June 1. Growth rates calculated between last months of period. low, but still IV4 percentage points below its high 2. Based on monthly averages of Wednesday data for domestically chartered banks and an average of current and previous month-end in the early spring. Bond offerings by lower-rated data for foreign-related institutions. Adjusted for outstanding amounts issuers remained at a relatively high level in the of loans sold to affiliates. Includes holdings of bankers acceptances. 3. Short- and intermediate-term business credit is business loans at third quarter; many of these issues were convertcommercial banks plus nonfinancial commercial paper plus finance ible debentures that were made more attractive company loans to businesses and bankers acceptances outstanding outside banks. Commercial paper is a prorated average of Wednesday by the further rise in the level of stock prices. data. Finance company loans and bankers acceptances outstanding The large volume of lower-rated issues fiare averages of current and previous month-end data. e. Estimated. nanced through the public market in part may Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

876 Federal Reserve Bulletin • November 1980 Gross offerings of new security issues third quarter (seasonally adjusted annual rate), Seasonally adjusted annual rates, in billions of dollars narrowly surpassing the previous high set in the second quarter. The large volume occurred de- 1979 1980 TTyyppee ooff sseeccuurriittyy spite an unusually large amount of postpone- Q2 Q3 Q4 Q1 Q2 Q3e ments, most of which were caused by interest domestic corporate 58 56 47 63 92 78 rate limitations that became binding as rates rose Publicly offered bonds . 35 26 25 23 69 47 Nonfinancial 20 16 19 20 49 38 over the third quarter. Housing-related revenue Financial 15 10 6 3 20 9 bond issues accounted for a majority of the post- Privately offered bonds 15 13 10 21 8 11 Stocks 8 17 12 19 15 20 ponements, and as a result, state and local gov- Foreign 7 9 5 2 6 3 ernments raised fewer funds for housing in the third quarter. State and local government 41 44 48 33 57 58 The rise in interest rates on state and local obe Estimated. ligations over the third quarter brought the Bond have reflected a lack of funds available through Buyer index for general obligation bonds from VU private placements. Life insurance companies percent at the end of June to near 9XU percent in are the major purchasers of privately placed late September, only slightly below its Marchbonds, and these insurers traditionally concen- April peak. Compared with taxable yields, taxtrate their placements in the quality range of Baa exempt interest rates rose relatively more during to A. Life insurance companies, however, did the third quarter. By September, the ratio of the not provide their usual support to private place- tax-exempt yield to the corporate bond yield was ments. Earlier in the year, their cash flow had about 0.66, up from a level of 0.58 registered in been considerably strained by a strong demand June, but still below the record 0.72 of Novemfor policy loans and unexpected deferrals of con- ber 1975. Reportedly, commercial banks and tributions by pension funds, and although the se- property-casualty insurance companies have reverity of this problem lessened when interest duced their demands for longer-term, tax-exempt rates subsided from their high levels reached in securities. Large underwriting losses experi- March and April, activity by the life insurance enced by the insurance companies likely reduced companies in the market for private placements the attractiveness of tax-exempt investments. remained limited in the third quarter. The Treasury's net cash borrowing from the Stock prices continued to increase in the third public totaled about $27 billion (not seasonally quarter. The major indexes of stock prices rose adjusted) in the third quarter, as the Treasury fibetween 9 and 23 percent, about the same as in nanced a deficit of about $20.5 billion and sought the second quarter. In contrast to the strength in a sizable increase in its cash balance by the end broad indexes of stock prices, utility prices of September. About half of the new money was showed some decline in the third quarter, in part raised in the Treasury's weekly and monthly bill reflecting the relative sensitivity of prices of util- auctions, and the remainder was obtained in regity stocks to increases in interest rates. The gen- ularly scheduled coupon auctions. During the erally higher level of share prices contributed to third quarter, the public redeemed about $300 a record volume of equity issues in the third million of savings bonds and notes; such redempquarter, following a substantial number of new tions totaled $3.9 billion and $2.7 billion in the stock issues in the second. The large volume of first and second quarters respectively when marstock issuance this year has included a marked ket rates of interest were much further above rise in sales of shares by smaller firms, including yields on savings bonds. Redemptions of this many that had not previously tapped the public magnitude possibly may be avoided in the future equity market. because the Congress has given the Treasury the authority to raise the yields on savings bonds to make them more competitive with alternative in- GOVERNMENT FINANCE struments. Net cash borrowing by federally sponsored The gross volume of bonds issued by state and agencies amounted to $400 million (not seasonlocal governments was a record $58 billion in the ally adjusted) for the July-September period, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Developments, Q3 1980 877 Federal government borrowing and cash balance Not seasonally adjusted, in billions of dollars 1978 1979 1980 IItteemm Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Treasury financing Budget surplus or deficit (-) -8.1 -23.8 -20.4 21.4 -4.4 -24.6 -27.1 8.2 -15.4 Off-budget deficit1 -3.1 -.1 -3.0 -5.2 -4.2 -.9 -3.8 -4.4 -4.9 New cash borrowings or repayments (-) 15.1 15.3 10.62 -4.6 12.4 18.9 19.1 5.4 27.1 Other means of financing3 1.0 2.6 4.2 -1.9 2.9 -1.7 4.1 -3.1 .1 Change in cash balance 4.9 -6.1 -8.6 9.8 6.7 -8.3 -7.7 5.9 6.9 Federally sponsored credit agencies, net cash borrowings4 6.1 5.2 6.3 5.5 4.7 7.3 8.6 5.8 .4 1. Includes outlays of the Pension Guaranty Corporation, Postal 3. Checks issued less checks paid, accrued items, and other trans- Service Fund, Rural Electrification and Telephone Revolving Fund, actions. Rural Telephone Bank, Housing for the Elderly and Handicapped 4. Includes debt of the Federal Home Loan Mortgage Corporation Fund, and Federal Financing Bank. All data have been adjusted to (FHLMC), Federal Home Loan Banks, Federal Land Banks, Federal reflect the return of the Export-Import Bank to the unified budget. Intermediate Credit Banks, Banks for Cooperatives, and Federal Na- 2. Includes $2.6 billion of borrowing from the Federal Reserve on tional Mortgage Association. March 31, which was repaid April 4 after enactment of a new debtceiling bill. considerably less than the more than $5 billion deposit flows improved in the spring. Support for registered in the third quarter of 1979 and second mortgage lending provided by federally related quarter of this year. All of the net borrowing in agencies operating in the secondary markets conthe third quarter occurred in September, with the tinued to be modest in the third quarter, although agencies reducing their indebtedness in July and net issuance of passthrough securities guaran- August. The turnaround in September primarily teed by the Government National Mortgage Asreflected a pickup in the financing activities of sociation increased moderately. Acquisitions of the Federal Home Loan Banks (FHLBs). After residential mortgages by state and local governreducing their borrowings $1.6 billion in July and ments likely remained sizable in the third quar- August, the FHLBs raised $800 million in September largely to accommodate increasing de- Net change in mortgage debt outstanding mands for FHLB advances by member institu- Seasonally adjusted annual rates, in billions of dollars tions. However, the Federal National Mortgage 1979 1980 Association ran off about $150 million of its MMoorrttggaaggee ddeebbtt Q2 Q3 Q4 Ql Q2 Q3e debt in September, following a paydown of $300 million in July and August combined. The By type of debt Total 164 161 150 144 73 136 Federal Farm Credit Banks borrowed about $2.7 Residential 118 115 114 104 44 99 billion in the third quarter, near the brisk pace of Other1 47 46 36 40 29 37 the first two quarters of 1980. By type of holder Commercial banks 30 34 32 27 6 14 Savings and loans 51 44 34 25 -1 40 Mutual savings banks 4 4 2 2 * * Life insurance companies 11 14 15 16 12 13 MORTGAGE AND CONSUMER FINANCE FNMA and GNMA 7 3 10 12 8 5 GNMA mortgage pools ... 19 24 27 18 17 23 FHLMC and FHLMC Mortgage borrowing picked up substantially in pools 4 5 3 3 3 4 Other2 38 33 27 41 28 36 the third quarter in lagged response to the easing of interest rates on new mortgage commitments 1. Includes commercial and other nonresidential as well as farm that occurred in the latter part of the second properties. 2. Includes mortgage companies, real estate investment trusts, quarter and early in the third. Much of the state and local credit agencies, state and local retirement funds, nonstrengthening in mortgage activity reflected a re- insured pension funds, credit unions, Farmers Home Administration and Farmers Home Administration pools, Federal Land Banks, Fedsumption of net lending in the residential mort- eral Housing Administration, Veterans Administration, and individgage market by depository institutions, particu- uals. e Partially estimated. larly savings and loan associations, whose *Less than $0.5 billion. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

878 Federal Reserve Bulletin • November 1980 ter, even though the issuance of housing revenue associations in some areas of the country reportbonds declined from the record pace of the pre- edly have offered renegotiable-rate mortgages at vious period. V2 to 1 percentage point below fixed-rate loans. Total deposits at savings and loan associations In response to the higher secondary market grew at a seasonally adjusted annual rate of 9 yields for government-underwritten loans, the percent in the third quarter, up slightly from 8V2 ceiling rates on both Federal Housing Adminispercent in the second. Despite some improve- tration and Veterans Administration contracts ment in deposit flows, savings and loans in the were increased twice during the quarter, bringing aggregate increased their borrowings by $1.5 bil- the ceilings in September to 13 percent for FHA/ lion (seasonally adjusted) from the FHLBs in VA level-payment loans and to 13V2 percent for August and September, after paying down $4 bil- FHA graduated-payment loans. lion of advances during the previous three Consumer credit increased slightly in the third months. The increase in FHLB advances, some- quarter, after a sharp contraction in the second what unusual during a period of improving de- that in part was associated with the credit reposit flows, could indicate that deposit growth straint program initiated in March. The decline in for at least some savings and loans was weaker consumer borrowing slowed considerably in than they had anticipated when issuing mortgage July, and in August there was a marginal increase commitments. in outstanding installment credit followed by a The average interest rate on new commitments somewhat larger gain in September. The growth for fixed-rate conventional home mortgages at late in the quarter was concentrated primarily in savings and loan associations fell slightly in the auto loans at finance companies and, to a lesser first part of the quarter, to about YlxU percent, extent, in revolving credit at retailers and gasoand remained almost unchanged through early line companies. By August, interest rates and August. Thereafter, interest rates in the primary other terms on auto lending at finance companies market began to rise in response to increases in and commercial banks had eased to near the levother long-term yields and as mortgage lenders, els that had existed before mid-March. Offsetting including savings and loans, became concerned some of the increases in finance company lending about the future cost and availability of loanable and in credit extensions at retailers and gasoline funds. By the end of September, the average companies were declines in loans to individuals commitment rate on conventional mortgage con- by commercial banks and credit unions. Even tracts reached almost 13 V2 percent, and it contin- these latter categories, however, strengthened ued to climb in early October. Savings and loan late in the quarter. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

879 Industrial Production Released for publication November 14 Production of durable materials surged 3.7 percent in October, reflecting large gains in the out- Industrial production rose an estimated 1.6 put of basic metals and of parts for consumer percent in October, after gains of 1.0 and 1.3 durables. Output of nondurable materials rose percent in August and September respectively 2.5 percent further after large (upward revised) based on upward revised data. Advances in proincreases in August and September; the October duction were broadly based, with large increases rise mainly reflected substantial increases in proin the output of motor vehicles and steel. Total duction of chemical materials. industrial production has increased 4 percent since its low in July, but the October index, at 146.0 percent of the 1967 average, was still 4.4 percent below a year earlier. Seasonally adjusted, ratio scale, 1967 = 100 Output of consumer goods rose 1.2 percent in October, reflecting a large gain for durable goods and almost no change for nondurable goods. Autos were assembled at an annual rate of 6.7 million units, compared with 6.0 million units in September. Output of utility vehicles (mainly lightweight trucks) again rose sharply. Production of home goods—such as appliances, carpeting, and furniture—advanced 1.9 percent further, although October output of these goods remained almost 9 percent below a year earlier. After three months of little change, production of business equipment increased 0.7 percent in October; output in this sector had declined 3.6 percent in the spring. Production of defense and space equipment rose sharply again. Output of construction supplies increased 1.7 percent, somewhat less than in August and September; production of these supplies remained about 12 Federal Reserve indexes, seasonally adjusted. Latest figures: Octopercent below a year earlier. ber. Auto sales and stocks include imports. 1967 == 100 Percentage change from preceding month PPPeeerrrccceeennntttaaagggeee ccchhhaaannngggeee GGGrrrooouuupppiiinnnggg 1980 1980 OOOcccttt... 111999777999 tttooo Sept.p Oct.e May June July Aug. Sept. Oct. OOOcccttt... 111999888000 Total industrial production 143.7 146.0 —2.9 -1.7 -.8 1.0 1.3 1.6 -4.4 Products, total 145.0 146.4 -2.0 -.8 .2 .8 .8 1.0 -2.5 Final products 143.7 145.1 -1.6 -.6 .1 .4 .6 1.0 -1.5 Consumer goods 143.8 145.5 -2.0 -.2 -.1 .6 .7 1.2 -3.0 Durable 133.0 138.6 -5.5 -.5 .1 .3 3.3 4.2 -9.5 Nondurable 148.1 148.3 -.7 -.1 -.1 .7 -.2 .1 -.3 Business equipment 170.5 171.7 -1.3 -1.2 .2 .2 .0 .7 -.3 Intermediate products 149.8 150.9 -3.1 -1.8 .7 2.0 1.6 .7 -6.0 Construction supplies 136.9 139.2 -4.6 -3.4 .1 3.2 3.2 1.7 -11.8 Materials 141.8 145.5 -4.4 -3.0 -2.5 1.6 2.2 2.6 -7.1 p Preliminary. e Estimated. NOTE. Indexes are seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

881 Announcements REGULATION D: AMENDMENTS beginning January 1981. These institutions hold AND INTERPRETATION less than 4 percent of all deposits. Consequently, the simplified procedures will The Federal Reserve Board has announced pub- relieve a reporting burden for 27,000 institulication of three rules in final form amending Reg- tions—about two-thirds of the total covered by ulation D (Reserve Requirements of Depository the new law—which hold only 4.33 percent of all Institutions) under the Monetary Control Act of deposits. Most of these institutions could cover 1980, together with an amendment to the defini- any required reserves with vault cash and so tion of Eurocurrency liabilities. Further, the would not be required to deposit funds with the Board simplified its rule for the calculation of re- Federal Reserve. serve requirements of banks that result from a These actions do not affect the U.S. agencies merger, so the requirements are calculated the and branches of foreign banks and Edge Act and same whether the surviving bank is a member or Agreement corporations. a nonmember bank. The Board deferred until May 1981 all reserve The Board has also issued an interpretation of and reporting requirements for nonmember de- Regulation D, effective November 13, 1980, depository institutions with less than $2 million in fining "bankers' banks" and setting forth the total deposits (as of December 31, 1979). At the criteria under which bankers' banks may act as same time, the Board adopted a procedure for passthrough agents for the reserves of other inquarterly reporting and reserve maintenance be- stitutions. ginning next January for institutions with $2 million to $15 million in total deposits. (Until January 15, 1981, nonmember institu- REGULATION J: MODIFICATION tions with deposits between $2 million and $15 million will not be required to report or hold re- The Federal Reserve Board on October 9, 1980, serves, but member banks of this size will con- adopted a clarification and simplification of its tinue to report and hold reserves weekly.) Regulation J, which deals with Reserve Bank Institutions with more than $15 million in total procedures for check collection (subpart A of the deposits are required to report weekly to the regulation) and wire transfer of funds (subpart B). Federal Reserve (beginning with the reporting The modification, proposed for public comweek of October 30-November 4) and to begin ment on December 14, 1979, makes no submaintaining reserve requirements November 13. stantive change in the regulation. It was under- The deferral of reporting and reserve require- taken by the Board as part of its Regulatory ments for nonmembers with less than $2 million Improvement Project, under which all of the in deposits will affect about 17,000 institutions, Board's regulations and rules are being reviewed primarily credit unions. These institutions, how- to determine whether they are in whole or in part ever, hold less than V2 percent of deposits in all required by law, what their costs and benefits affected institutions—commercial banks, mutual are, whether underlying statutes need revision, savings banks, savings and loan associations, whether there are nonregulatory alternatives, and credit unions. and whether any regulations can be eliminated. Almost 10,000 institutions with deposits be- As part of this project, the Board's regulations tween $2 million and $15 million will be affected are also being simplified or put into better format by quarterly reporting and reserve maintenance when possible. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

882 Federal Reserve Bulletin • November 1980 A proposed new section of Regulation J (sub- ary accounts (provided entire beneficial interest part C), dealing with electronic transfer of funds is held by individuals or qualifying organizathrough automated clearinghouses operated by tions), pension funds, and trade associations. the Federal Reserve, was issued for comment in November 1979. Copies of subparts A and B of Regulation J will PROPOSED ACTION be distributed to institutions that use the Federal Reserve for check clearing and wire transfer of The Federal Reserve Board on October 27, 1980, funds. The text of the regulation is available up- proposed for public comment a policy statement on request from the Federal Reserve Board and concerning payments to brokers for research and the Reserve Banks. brokerage services by trust institutions subject to the Board's supervision. The Board asked for comment by December 22, 1980. REGULATION Q: INTERPRETATION AND AMENDMENT CHANGE IN BOARD STAFF The Federal Reserve Board on October 27, 1980, issued an interpretation of Regulation Q (Interest The Board of Governors has announced the folon Deposits) providing that fixed-rate obligations lowing appointment. of bank holding companies with certain specified Laura M. Homer as Securities Credit Officer in features are not subject to interest rate ceilings. the Division of Banking Supervision and Regula- Later, on October 30, 1980, the Board an- tion, effective November 16, 1980. Ms. Homer, nounced publication of the official notice of its who joined the Board's staff in 1971, holds a B.A. technical amendment to Regulation Q reducing from the University of Connecticut and a J.D. the minimum maturity of time deposits at mem- from the University of Miami. ber banks to 14 days. S YSTEM MEMBERSHIP: INFORMATION ON ELIGIBLE NOW ADMISSION OF STATE BANKS CUSTOMERS The following banks were admitted to member- Because negotiable order of withdrawal (NOW) ship in the Federal Reserve System during the accounts may be offered by financial institutions period October 11 through November 10, 1980: in all parts of the nation beginning December 31, 1980, the staff of the Federal Reserve Board has Colorado made available information summarizing the cat- Aurora Fidelity Bank and Trust egories of depositors eligible to maintain NOW Clifton Bank of Clifton accounts at member banks. The information may Denver Independent State Bank be obtained on request from Publications Ser- Leadville . First Mining and Exchange Bank vices, Board of Governors of the Federal Re- of Leadville serve System, Washington, D.C. 20551. Littleton . Columbine Valley Bank and Trust The following categories of depositors are eli- Kansas gible to hold NOW accounts at member banks: Olathe First Citibank of Olathe individuals, sole proprietors, husband and wife Overland Park . . Corporate Woods State Bank operating unincorporated business, local housing New York authority, residential tenants' security deposits, New York . Bankamerica Securities Services independent school districts, redevelopment au- Company of New York thority, escrow funds (provided entire beneficial Wyoming interest is held by individuals or qualifying or- Lander Yellowstone State-Bank-Lander ganizations), labor unions, trust and other fiduci- Medicine Bow ... Medicine Bow State Bank Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

883 Record of Policy Actions of the Federal Open Market Committee Meeting Held on the August increase, registered its September 16,1980 first monthly gain since December 1979, and the length of the average workweek rose substantially. Domestic Policy Directive The Department of Commerce The information reviewed at this survey of business spending plans meeting suggested that the decline in taken in July and August indicated real output of goods and services that current-dollar expenditures for had moderated in the third quarter, plant and equipment would be about following a contraction at an annual 83/ percent higher in 1980 than in 4 rate of 9.0 percent in the second 1979. In view of the expenditures in quarter, and some recent data in- the first half of 1980, the indicated indicated that the decline might have crease for the year as a whole imended, at least temporarily. Average plied a marked decline in real outprices, as measured by the fixed- lays for the second half. New orders weight price index for gross domes- for nondefense capital goods and tic business product, were contin- contracts for business construction uing to rise at a rapid pace, which strengthened in June and July but was, however, slightly below the an- were still well below their levels nual rate of increase of about IOV2 early in the year. percent indicated for the second Private housing starts edged up in quarter. July to an annual rate of about 1.3 The dollar value of total retail million units, following a substantial sales rose considerably further in rebound in June from the depressed August, according to the advance re- levels of earlier months; building port, after increasing sharply in June permits for new units rose markedly. and July. Sales of new automobiles Sales of new houses increased for were at an annual rate of 8.6 million the third successive month, bringing units, down from 9.0 million in July the number of unsold units to its but appreciably above the second- lowest level in more than four years. quarter rate. Sales of existing homes, which had The index of industrial production picked up in June after eight conrose an estimated 0.5 percent in Au- secutive months of decline, rose gust, following a cumulative decline substantially further in July. of about 8.5 percent over the preced- Producer prices of finished goods ing six months. The August increase rose rapidly in July and August, after was fairly widespread among indus- increasing at a sharply reduced pace try groupings, with notable gains in during the second quarter; the recent output of construction supplies and advances reflected mainly a surge in consumer home goods. food prices. At the consumer level, Nonfarm payroll employment ex- increases in prices of food and many panded in August after several months commodities accelerated in July, but of decline, and the unemployment a sharp decline in measured costs of rate edged down from 7.8 to 7.6 per- homeownership held the overall cent. Employment in manufacturing, consumer price index to its monthwhich accounted for about half of earlier level. The index of average Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

884 Federal Reserve Bulletin • November 1980 hourly earnings of private nonfarm funds rate from the 8V2 to 9 percent production workers rose at an annu- area at the time of the August meetal rate of about 83A percent over the ing to around IOV2 to 11 percent first eight months of the year, some- in recent days. what faster than in 1979, but the rate Growth of M-1A and M-1B accelof increase in July and August was erated in August to record annual more moderate than that earlier in rates of about 19V2 percent and 22 the year. percent respectively from rates of In foreign exchange markets the about VU percent and 11 percent in trade-weighted value of the dollar July. Expansion in M-2 remained against major foreign currencies had rapid in August at an annual rate of declined somewhat over the interval about 14 V4 percent but was down since the Committee's meeting on from growth rates averaging 18 per- August 12. The U.S. foreign trade cent in June and July. For the period deficit was reduced further in July to from the fourth quarter of 1979 a level significantly lower than the through August, growth of M-1A average for the second quarter. A was in the lower half of the Comsharp decline in petroleum imports mittee's range for the year ending accounted for most of the change as with the fourth quarter of 1980; exports and non-oil imports were growth of M-1B was in the upper about unchanged. half of its range, while growth of M-2 At its meeting on August 12, the was somewhat above the upper limit Committee had decided that open of its range. market operations in the period until Total credit outstanding at U.S. this meeting should be directed to- commercial banks picked up in July ward expansion of reserve aggre- and expanded substantially further gates consistent with growth of in August, following a decline in the M-1A, M-1B, and M-2 from June to second quarter. Bank holdings of September at annual rates of about securities grew rapidly in both 6V2 percent, 9 percent, and 12 per- months, and total loans increased cent respectively, provided that in substantially in August, after changthe intermeeting period the weekly ing little in July. Loans to businesses average federal funds rate remained exhibited renewed strength in Auwithin a range of 8 to 14 percent. gust, and real estate lending ex- Early in the intermeeting interval, panded moderately. A sharp decline incoming data indicated that growth in net issues of commercial paper by of M-1A and M-1B would probably nonfinancial corporations partly offexceed the Committee's third-quar- set the growth in business loans. ter objectives, as well as earlier pro- Market interest rates fluctuated jections, by a wide margin, and widely but rose on balance over the growth of M-2 was also expected to intermeeting interval. Upward presbe relatively rapid. Required re- sures on rates reflected market reserves, and thus member bank de- sponse to the exceptionally rapid mands for reserves, rose sub- growth in money and the associated stantially in relation to the supply impact on bank reserve positions, to being made available through open further indications of improvement market operations. As a consequence, in real economic activity, to the dismember bank borrowings for reserve- appointing performance of measures adjustment purposes moved up sharp- of inflation, and to concerns about ly from a weekly average of about prospective budgetary deficits. On $110 million at the time of the Au- balance, short-term rates increased gust meeting to an average of about about IV2 to 2 percentage points $825 million in the two latest state- over the intermeeting period and ment weeks. The pressures on bank long-term rates rose about lU to 3U reserve positions were also associ- percentage point. Commercial banks ated with increases in the federal raised their loan rate to prime busi- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 885 ness borrowers from 11 percent to Committee agreed that from the 12V4 percent. In primary markets for fourth quarter of 1979 to the fourth home mortgages, rates on new com- quarter of 1980, average rates of mitments at savings and loan associ- growth in the monetary aggregates ations averaged a little over 13 per- within the following ranges appeared cent compared with \2lU percent at to be consistent with broad economthe time of the August meeting. ic aims: M-1A, VI2 to 6 percent; The staff projections presented at M-1B, 4 to 6V2 percent; M-2, 6 to 9 this meeting suggested that the de- percent; and M-3, 6V2 to 9V2 percent. cline in real GNP would be much The associated range for the rate of less pronounced in the third quarter growth in commercial bank credit than had appeared likely a month was 6 to 9 percent. For the period earlier; a modest recovery in real from the fourth quarter of 1980 to the GNP was expected to begin by year- fourth quarter of 1981, the Comend and to continue in 1981. The mittee looked toward a reduction in unemployment rate was projected to the ranges for growth of M-1A, increase somewhat more gradually M-1B, and M-2 on the order of V2 over the months ahead than had percentage point from the ranges been anticipated earlier. While the adopted for 1980, abstracting from projections suggested slightly larger institutional influences affecting the price increases, the staff continued behavior of the aggregates. It was to expect that the rise in the fixed- understood that the longer-run ranges weight index for gross domestic would be reconsidered as conditions business product would be some- warranted. what less rapid in 1981 than in 1980. In contemplating policy for the pe- The Committee's discussion of the riod immediately ahead, the Comeconomic outlook indicated a broad- mittee took note of a staff analysis ly shared judgment that a recovery indicating that growth of M-1A and in economic activity was under way, M-1B was running well above, and and some members believed that the growth of M-2 moderately above, economy was likely to be somewhat the objectives established by the stronger in the fourth quarter than Committee for the June-to-Septemthe staff was projecting. Other mem- ber period. Given the recent behavbers were less sanguine about the ior of money, achievement of the near-term outlook, and some ex- Committee's monetary growth obpressed the view that a renewed jectives for the year would require a downturn could not be ruled out. marked slowing in growth over the With regard to the outlook for 1981, balance of the year and the staff prothe members were in broad agree- jection suggested that such a slowing ment with the staff projection of a was likely in September. modest recovery. Concern was ex- In the Committee's discussion of pressed that, despite the competitive policy, all of the members favored pressures in many industries and rel- operations over the period ahead diatively high levels of unemployment, rected toward the deceleration in a substantial rise in wages and prices monetary growth needed to promote remained in prospect for the year achievement of the Committee's obahead. Under such circumstances jectives for the year. The members several members noted a potential recognized that achievement of the dilemma between the need for sus- growth objectives for M-1A and tained recovery and the need for sig- M-1B might be associated with exnificant progress toward bringing in- pansion in M-2 at a rate slightly in exflation under control. cess of the Committee's 1980 range At its meeting in July, the Com- for that broader measure of money, mittee had reaffirmed the ranges for given the shifts that had occurred in monetary growth in 1980 that it had the public's preferences for deposits established in February. Thus, the of various types. The members also Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

886 Federal Reserve Bulletin • November 1980 recognized that, in light of the rapid aggregates over the balance of the expansion in NOW and ATS ac- year. In the discussion, it was obcounts, growth in M-1B for the year served that the reserve path to was likely to be higher relative to achieve restraint in money growth growth in M-1A than was implied by would probably not involve an imthe ranges set for each of these mon- mediate change in money market etary aggregates at the start of the conditions, assuming that money year. growth did slow sharply in Septem- While there was general agree- ber. Differences for the most part ment that monetary expansion turned on the degree of pressure on should be reduced substantially from bank reserve positions that could the recent pace, differing views emerge should money demand begin emerged concerning the specific to exceed the money supply path. growth objectives that should be es- At the conclusion of the distablished for the August-to-Decem- cussion the Committee agreed that ber period. Some members favored open market operations in the period growth-rate objectives on the low until the next meeting should be diside of the ranges that were consid- rected toward expansion of reserve ered at this meeting in order to pro- aggregates consistent with growth of vide greater assurance that the Com- M-1A, M-1B, and M-2 over the Aumittee would achieve its objectives gust-to-December period at annual for the year as a whole. Members rates of about 4 percent, 6V2 persupporting this view emphasized the cent, and 8V2 percent respectively, need for a policy posture that would provided that in the period before minimize any risk of exacerbating in- the next regular meeting the weekly flationary forces in the economy or average federal funds rate remained worsening inflationary expectations. within a range of 8 to 14 percent. If it Other members believed that, in appeared during the period before light of present economic and finan- the next regular meeting that the cial market conditions, growth in the constraint on the federal funds rate August-to-December period might was inconsistent with the objective reasonably be a bit higher, consist- for the expansion of reserves, the ent with growth for the year in the Manager for Domestic Operations upper part of the range established was promptly to notify the for M-1B and around the midpoint of Chairman, who would then decide the range set for M-1A; this ap- whether the situation called for proach was also viewed as consist- supplementary instructions from the ent with broad, longer-run policy Committee. objectives. In this connection it was The following domestic policy diobserved that interest rates had al- rective was issued to the Federal Reready risen appreciably from their serve Bank of New York: recent lows, that these increases might well begin to reduce money The information reviewed at this and credit demands over the months meeting suggests that the decline in ecoahead, that economic recovery was nomic activity has moderated in the third quarter following a sharp contraction in in its very early stages, and that the second quarter. Industrial producsome sectors such as housing were tion and nonfarm payroll employment especially sensitive to emerging expanded in August after several months credit conditions. of decline; the unemployment rate edged down from 7.8 to 7.6 percent; and total Still other members proposed a retail sales advanced considerably furmiddle course—a policy approach ther. In July housing starts rose slightly, that was adopted. It was generally following a substantial rebound in June, recognized that differences in ap- and were well above the depressed levels of the preceding three months. Producer proach were relatively minor: All of prices of finished goods rose rapidly in the members favored a policy that July and August, after increasing at a would greatly reduce growth in the sharply reduced pace in the second quar- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 887 ter; the recent advance reflected mainly percentage point from the ranges a surge in food prices. Over the first eight adopted for 1980, abstracting from instimonths of the year, the rise in the index tutional influences affecting the behavior of average hourly earnings was some- of the aggregates. These ranges will be what faster than the pace recorded in reconsidered as conditions warrant. 1979, In the short run, the Committee seeks The weighted average value of the dol- expansion of reserve aggregates consistlar in exchange markets has declined ent with growth of M-1A, M-1B, and somewhat over the past five weeks. The M-2 over the August-to-December period U.S. trade deficit in July was significant- at annual rates of about 4 percent, 6V2 ly lower than the monthly average in the percent, and 8V2 percent respectively, second quarter, reflecting a sharp decline provided that in the period before the in petroleum imports. next regular meeting the weekly average M-1A and M-1B grew at record rates federal funds rate remains within a range in August, while growth in M-2 moder- of 8 to 14 percent. ated from an exceptionally rapid pace in If it appears during the period before June and July. For the year through Au- the next meeting that the constraint on gust growth of M-1A was in the lower the federal funds rate is inconsistent with half and growth of M-1B in the upper half the objective for the expansion of reof their respective ranges set by the serves, the Manager for Domestic Oper- Committee for the year from the fourth ations is promptly to notify the Chairquarter of 1979 to the fourth quarter of man, who will then decide whether the 1980, while growth in M-2 was somewhat situation calls for supplementary instrucabove the upper limit of its range. Mar- tions from the Committee. ket interest rates have fluctuated widely since mid-August and on balance short- Votes for this action: Messrs. term rates have risen considerably while Volcker, Gramley, Morris, Partee, long-term rates have increased moder- Rice, Schultz, Solomon, and Mrs. ately. Teeters. Votes against this action: The Federal Open Market Committee Messrs. Guffey, Roos, Wallich, and seeks to foster monetary and financial Winn. conditions that will help to reduce inflation, encourage economic recovery, and Messrs. Guffey, Roos, Wallich, and contribute to a sustainable pattern of in- Winn dissented because they believed ternational transactions. At its meeting that, given the excessive monetary in July, the Committee agreed that these expansion in recent months and the objectives would be furthered by growth outlook for inflation, the directive of M-1A, M-1B, M-2, and M-3 from the adopted at this meeting incurred too fourth quarter of 1979 to the fourth quar- much of a risk that the Committee's ter of 1980 within ranges of Vh to 6 per- objectives for monetary growth in cent, 4 to 6V2 percent, 6 to 9 percent, and 1980 would be exceeded. To enhance 6V2 to 9V2 percent respectively. The as- the prospects for restraining monesociated range for bank credit was 6 to 9 tary growth to rates consistent with percent. For the period from the fourth the longer-run ranges, they favored quarter of 1980 to the fourth quarter of specifying lower rates of growth for 1981, the Committee looked toward a re- M-1A, M-1B, and M-2 over the Auduction in the ranges for growth of gust-to-December period than those M-1A, M-1B, and M-2 on the order of V2 that were adopted. 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

Legal Developments AMENDMENTS TO REGULATION D affiliated Edge or Agreement Corporation that were acquired after October 6, 1979, from the The Board of Governors has amended its Regulation United States branch or agency (other than as- D, Reserve Requirements of Depository Institutions, sets required to be sold by Federal or State suto: (1) extend the special rule regarding quarterly re- pervisory authorities). porting to apply to all depository institutions that have total deposits of less than $15 million (As originally adopted, quarterly reporting was limited to depository 2. In section 204.3, paragraph (d)(1) and (d)(3) is reinstitutions with total deposits of less than $5 million); vised to read as follows: (2) defer until May 1981 the reporting and reserve maintenance requirements for nonmember depository Section 204.3—Computation and Maintenance institutions with less than $2 million in total deposits; and (3) simplify the method of calculation of reserve requirements where member and nonmember institu- (d) Special rule for depository institutions that have tions are involved in mergers so that reserves of the total deposits of less than $15 million. surviving institution are calculated by allocating its de- (1) A depository institution with total deposits of posits according to the relative deposit size and struc- less than $15 million shall file a report of deposits ture of the institutions involved in the merger on a pro- once each calendar quarter for a seven-day comportional basis without regard to whether the surviving putation period that begins on the third Thursday of institution is a member or a nonmember. a given month during the calendar quarter. Each Effective November 13, 1980, Regulation D is Reserve Bank shall divide the depository instituamended as follows: tions in its District that qualify under this paragraph into three substantially equal groups and assign each 1. In section 204.2, paragraph (h)(l)(i)(B) and (h)(l)(ii)(B) group a different month to report during each calenis revised to read as follows: dar quarter. (2) *** Section 204.2—Definitions (3) A depository institution that has less than $15 million in total deposits as of December 31, 1979, shall qualify under this paragraph until it reports to- (h) Eurocurrency liabilities means the sum of the fol- tal deposits of $15 million or more for two conlowing: secutive calendar quarters. (1) Transactions with related offices outside the United States, (j) *** 3. In section 204.4, paragraph (g) is revised to read as (A) *** follows: (B) assets (including participations) held by its non-United States offices or by non-United Section 204.4—Transitional Adjustments States offices of an affiliated Edge or Agreement Corporation that were acquired after October 6, 1979, from its United States offices. (g) Mergers and consolidations. The following rules concerning transitional adjustments apply to mergers *** and consolidations of depository institutions. (B) assets (including participations) held by its (1) Where all depository institutions involved in a foreign bank (including offices thereof located merger or consolidation are subject to the same outside the United States), by its parent holding paragraph of the transitional adjustment rules concompany, or by non-United States offices of an tained in paragraphs (a) through (f) of this section Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

890 Federal Reserve Bulletin • November 1980 during the reserve computation period immediately age total required reserves of each depository inpreceding the merger, the surviving institution shall stitution involved in the merger were to the sum of continue to compute its transitional adjustment of daily average total required reserves of all institurequired reserves under such applicable paragraph, tions involved in the merger or consolidation durexcept that the amount of reserves which shall be ing the reserve computation period immediately maintained shall be reduced by an amount deter- preceding the date of the merger. mined by multiplying the amount by which the re- (A) If the merger occurs before November 6, quired reserves during the computation period im- 1980, such ratio of daily average total required mediately preceding the date of the merger reserves shall be computed using the reserve re- (computed as if the depository institutions had quirement ratios in section 204.8(b). merged) exceeds the sum of the actual required re- (B) If the merger occurs on or after November serves of each depository institution during the 6, 1980, such ratio of daily average total resame computation period, times the appropriate per- quired reserves shall be computed using the recentage as specified in the following schedule: serve requirement ratios in section 204.8(a) without regard to the transitional adjustments of this section. (iii) The low reserve tranche on transaction accounts (section 204.8(a)) shall be allocated to each Maintenance periods Percentage applied occurring during to difference institution involved in the merger or consolidation quarterly periods to compute using the ratio computed in subparagraph (2)(ii) following merger amount to be subtracted and the reserve requirement tranches on demand 1 87.5 deposits (section 204.8(b)) shall be allocated to 2 75.0 member bank deposits using such ratio of daily 3 62.5 4 50.0 average total required reserves. 5 37.5 (iv) The vault cash of the surviving depository in- 6 25.0 7 12.5 stitution also will be allocated to each institution 8 and succeeding 0 involved in the merger or consolidation according to the ratio that daily average vault cash of each (2) (i) Where the depository institutions involved in depository institution involved in the merger was a merger or consolidation are not subject to the to the sum of daily average vault cash of all instisame paragraph of the transitional adjustment rules tutions involved in the merger or consolidation contained in paragraphs (a) through (f) of this secduring the reserve computation period immediatetion and such merger or consolidation occurs ly preceding the date of the merger. (A) on or after July 1, 1979, between a non- (v) The amount of reserves which shall be mainmember bank and a bank that was a member tained shall be reduced by an amount determined bank on or after July 1, 1979, and the survivor is by multiplying the amount by which the required a nonmember bank; reserves during the computation period immedi- (B) on or after March 31, 1980, between a ately preceding the date of the merger (computed member bank and a nonmember bank and the as if the depository institutions had merged) exsurvivor is a member bank; or ceeds the sum of the actual required reserves of (C) on or after September 1, 1980, between any each depository institution during the same comother depository institutions putation period, times the appropriate percentage as specified in the following schedule: the required reserves of the surviving institution shall be computed by allocating its deposits, Eurocurrency liabilities, other reservable claims, balances due from other depository institutions and cash items in process Maintenance periods Percentage applied of collection to each depository institution involved in occurring during to difference quarterly periods to compute the merger transaction and applying to such amounts following merger amount to be subtracted the transitional adjustment rule of paragraphs (a) through (f) of this section to which each such deposi- 87.5 tory institution was subject during the reserve compu- 2 75.0 3 62.5 tation period immediately prior to the merger or con- 4 50.0 5 37.5 solidation. 6 25.0 (ii) The deposits of the surviving institution shall 7 12.5 8 and succeeding 0 be allocated according to the ratio that daily aver- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 891 REVISION OF REGULATION J (1) payable in a Federal Reserve District1 (District); (2) sent by a sender to a Reserve Bank for handling The Board of Governors has adopted in final form revi- under this subpart; and sions that clarify and simplify Subparts A and B of (3) collectible in funds acceptable to the Reserve Regulation J, Collection of Checks and Other Items Bank of the District in which the instrument is payand Wire Transfers of Funds. able. Unless otherwise indicated, item includes both cash COLLECTION OF CHECKS AND OTHER ITEMS AND and noncash items. Item does not include a check that WIRE TRANSFERS OF FUNDS cannot be collected at par,2 or an item as defined in section 210.26 that is handled under subpart B. Subpart A—Collection of Checks and Other Items (g) Nonbank payor means a payor of an item, other than a bank. Section 210.1—Authority, Purpose, and Scope (h) Noncash item means an item that a receiving Re- The Board of Governors of the Federal Reserve Sysserve Bank classifies in its operating circulars as retem ("Board") has issued this subpart pursuant to the quiring special handling. The term also means an item Federal Reserve Act, section 13 (12 U.S.C. § 342), normally received as a cash item if a Reserve Bank section 16 (12 U.S.C. §§ 248(o), 360), section ll(i) (12 decides that special conditions require that it handle U.S.C. § 248(i)), and other laws. This subpart governs the item as a noncash item. the collection of checks and other cash and noncash items by Federal Reserve Banks ("Reserve Banks"). (i) Paying bank means: Its purpose is to provide rules for collecting items and (1) the bank by which an item is payable, unless the settling balances. item is payable or collectible through another bank and is sent to the other bank for payment or collec- Section 210.2—Definitions tion; or (2) the bank through which an item is payable or As used in this subpart, unless the context otherwise collectible and to which it is sent for payment or colrequires: lection. (a) Actually and finally collected funds means cash or (j) Sender means any of the following that sends an any other form of payment that is, or has become, final item to a Reserve Bank: a member bank, a nonmember and irrevocable. clearing bank, another Reserve Bank, an international organization, a foreign correspondent, or a branch or (b) Bank draft means a check drawn by one bank on agency of a foreign bank maintaining reserves under another bank. section 7 of the International Banking Act of 1978. (c) Banking day means a day during which a bank is (1) Nonmember clearing bank means: open to the public for carrying on substantially all its (i) a bank that is not a member of the Federal Rebanking functions. serve System, but maintains with a Reserve Bank the balance referred to in the first paragraph of (d) Cash item means: section 13 of the Federal Reserve Act; or (1) a check other than one classified as a noncash (ii) a corporation that maintains an account with a item under this section; or Reserve Bank in conformity with section 211.4 of (2) any other item payable on demand and collectthis chapter (Regulation K). ible at par that the Reserve Bank of the District in which the item is payable is willing to accept as a (2) International organization means an intercash item. national organization for which a Reserve Bank is (e) Check means a draft, as defined in the Uniform Commercial Code, that is drawn on a bank and pay- 1. For purposes of this subpart, the Virgin Islands and Puerto Rico are deemed to be in the Second District, and Guam and American able on demand. Samoa in the Twelfth District. 2. The Board publishes a Memorandum on Exchange Charges, listing the banks that would impose exchange charges on cash items and (f) Item means an instrument for the payment of monother checks forwarded by Reserve Banks and therefore would not ey, whether negotiable or not, that is: pay at par. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

892 Federal Reserve Bulletin • November 1980 empowered to act as depositary or fiscal agent and owned or controlled Government corporation, that maintains an account. maintains or uses an account with a Reserve Bank. (3) Foreign correspondent means any of the follow- Section 210.4—Sending Items to Reserve Banks ing for which a Reserve Bank maintains an account: a foreign bank or banker, a foreign state as defined (a) A sender may send any item to the Reserve Bank in section 25(b) of the Federal Reserve Act with which it maintains or uses an account, but that (12 U.S.C. § 632), or a foreign correspondent or Reserve Bank may permit or require the sender to agency referred to in section 14(e) of that Act send direct to another Reserve Bank an item payable (12 U.S.C. § 358). within the other Reserve Bank's District. (b) With respect to an item sent direct, the relation- (k) State means a State of the United States, the Dis- ships and the rights and liabilities between the sender, trict of Columbia, Puerto Rico, or a territory, posses- the Reserve Bank of its District, and the Reserve Bank sion, or dependency of the United States. to which the item is sent are the same as if the sender had sent the item to the Reserve Bank of its District Section 210.3—General Provisions and that Reserve Bank had sent the item to the other Reserve Bank. (a) General. Each Reserve Bank shall receive and (c) The Reserve Banks shall receive cash items and handle items in accordance with this subpart, and shall other checks at par. issue operating circulars governing the details of its handling of items and other matters deemed appropri- Section 210.5—Sender's Agreement; Recovery ate by the Reserve Bank. The circulars may, among By Reserve Bank other things, classify cash items and noncash items, require separate sorts and letters, and provide dif- (a) Sender's agreement. By sending an item to a Referent closing times for the receipt of different classes serve Bank, the sender: or types of items. (1) authorizes the receiving Reserve Bank (and any other Reserve Bank or collecting bank to which the (b) Binding effect. This subpart and the operating cir- item is sent) to handle the item subject to this subculars of the Reserve Banks are binding on the sender part and to the Reserve Banks' operating circulars, of an item, on each collecting bank, paying bank, and and warrants its authority to give this authorization; nonbank payor, to which a Reserve Bank (or a sub- (2) warrants to each Reserve Bank handling the sequent collecting bank) presents or sends an item, item that: (i) the sender has good title to the item or and on other parties interested in the item, including is authorized to obtain payment on behalf of one the owner. who has good title (whether or not this warranty is evidenced by the sender's express guaranty of prior (c) Government Items. As depositaries and fiscal indorsements on the item); and (ii) to the extent preagents of the United States, Reserve Banks handle scribed by State law applicable to a Reserve Bank or certain items payable by the United States or certain subsequent collecting bank handling the item, Federal agencies as cash or noncash items. To the ex- the item has not been materially altered; but this tent provided by regulations issued by, and arrange- subparagraph (2) does not limit any warranty by a ments made with, the United States Treasury Depart- sender arising under State law; and ment and other Government departments and (3) agrees to indemnify each Reserve Bank for any agencies, the handling of such items is governed by loss or expense sustained (including attorneys' fees this subpart. The Reserve Banks shall include in their and expenses of litigation) resulting from (i) the operating circulars such information regarding these sender's lack of authority to make the warranty in regulations and arrangements as the Reserve Banks paragraph (a)(1) of this section; (ii) any action taken deem appropriate. by the Reserve Bank within the scope of its authority in handling the item; or (iii) any warranty made (d) Government Senders. Except as otherwise pro- by the Reserve Bank under section 210.6(b) of this vided by statutes of the United States, or regulations subpart. issued or arrangements made thereunder, this subpart and the operating circulars of the Reserve Banks apply (b) Recovery by Reserve Bank. If an action or proto the following when acting as a sender: a depart- ceeding is brought against a Reserve Bank that has ment, agency, instrumentality, independent estab- handled an item, based on: lishment, or office of the United States, or a wholly (1) the alleged failure of the sender to have the au- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 893 thority to make the warranty and agreement in sub- a paying bank or nonbank payor appearing in any paragraph (a)(1) of this section; form on the item when the Reserve Bank receives it. (2) any action by the Reserve Bank within the scope A Reserve Bank shall not be responsible for any of its authority in handling the item; or delay resulting from its acting on any designation, (3) any warranty made by the Reserve Bank under whether inscribed by magnetic ink or by other section 210.6(b) of this subpart, means, and whether or not the designation acted on is consistent with any other designation appearing the Reserve Bank may, upon the entry of a final judg- on the item. ment or decree, recover from the sender the amount of attorneys' fees and other expenses of litigation in- (b) Warranties and liability. By presenting or sending curred, as well as any amount the Reserve Bank is re- an item, a Reserve Bank warrants to a subsequent colquired to pay under the judgment or decree, together lecting bank and to the paying bank and any other paywith interest thereon. or: (1) that the Reserve Bank has good title to the item (c) Methods of recovery. The Reserve Bank may re- (or is authorized to obtain payment on behalf of one cover the amount stated in paragraph (b) of this sec- who either (i) has good title or (ii) is authorized to tion by charging any account on its books that is main- obtain payment on behalf of one who has good title), tained or used by the sender (or if the sender is another whether or not this warranty is evidenced by the Re- Reserve Bank, by entering a charge against the other serve Bank's express guaranty of prior indorse- Reserve Bank through the Interdistrict Settlement ments on the item; and Fund), if: (2) that the item has not been materially altered to (1) the Reserve Bank made seasonable written de- the extent prescribed by State law applicable to a mand on the sender to assume defense of the action Reserve Bank or subsequent collecting bank holding or proceedings; and the item. (2) the sender has not made any other arrangement for payment that is acceptable to the Reserve Bank. The Reserve Bank shall not have or assume any other liability to the paying bank or other payor, except for A Reserve Bank that has been charged through the In- the Reserve Bank's own lack of good faith or failure to terdistrict Settlement Fund may recover from its send- exercise ordinary care. er in the manner and under the circumstances set forth in this paragraph. A Reserve Bank's failure to avail Section 210.7—Presenting Items for Payment itself of the remedy provided in this paragraph does not prejudice its enforcement in any other manner of (a) Presenting or sending. As provided under State the indemnity agreement referred to in subparagraph law or as otherwise permitted by this section: (1) a Re- (a)(3) of this section. serve Bank or a subsequent collecting bank may present an item for payment or send the item for present- Section 210.6—Status, Warranties, and Liability ment and payment; and (2) a Reserve Bank may send of Reserve Bank an item to a subsequent collecting bank with authority to present it for payment or to send it for presentment (a)(1) Status and liability. A Reserve Bank shall act and payment. only as the sender's agent in respect of an item. This agency terminates not later than the time the (b) Place of presentment. A Reserve Bank or sub- Reserve Bank receives payment for the item in ac- sequent collecting bank may present an item: tually and finally collected funds and makes the (1) at a place requested by the paying bank; proceeds available for use by the sender. A Re- (2) at a place requested by the nonbank payor, if the serve Bank shall not act as agent or subagent of an item is payable by a nonbank payor other than owner or holder of an item other than the sender. through a paying bank; A Reserve Bank shall not have or assume any lia- (3) under a special collection agreement consistent bility to the sender in respect of an item or its pro- with this subpart; or ceeds except for the Reserve Bank's own lack of (4) through a clearing house and subject to its rules good faith or failure to exercise ordinary care. and practices. (2) Reliance on routing designation appearing on (c) Presenting or sending direct. A Reserve Bank or item. A Reserve Bank may present or send an item subsequent collecting bank may, with respect to an based on the routing number or other designation of item payable in the Reserve Bank's District: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

894 Federal Reserve Bulletin • November 1980 (1) present or send the item direct to the paying The proceeds of any payment shall be available to the bank, or to a place requested by the paying bank; or Reserve Bank by the close of the Reserve Bank's (2) if the item is payable by a nonbank payor other banking day on the banking day of receipt of the item than through a paying bank, present it direct to the by the paying bank. If the banking day of receipt is not nonbank payor. Documents, securities, or other pa- a banking day for the Reserve Bank, payment shall be pers accompanying a noncash item shall not be de- made on the next day that is a banking day for both the livered to the nonbank payor before the item is paid Reserve Bank and the paying bank. unless the sender specifically authorizes delivery. (b) Noncash items. A Reserve Bank may require the (d) Item payable in another district. A Reserve Bank paying or collecting bank to which it has presented or receiving an item payable in another District ordinarily sent a noncash item to pay for the item in cash, but the sends the item to the Reserve Bank of the other Dis- Reserve Bank may permit payment by a debit to an trict, but with the agreement of the other Reserve account on the Reserve Bank's books or by any of the Bank, may present or send the item as if it were pay- following that is in a form acceptable to the Reserve able in its own District. Bank: bank draft, transfer of funds or bank credit, or any other form of payment authorized by State law. Section 210.8—Presenting Noncash Items for Acceptance (c) Nonbank payor. A Reserve Bank may require a nonbank payor to which it has presented an item to A Reserve Bank or a subsequent collecting bank may, pay for it in cash, but the Reserve Bank may permit if instructed by the sender, present a noncash item for payment in any of the following that is in a form acacceptance in any manner authorized by law if: (1) the ceptable to the Reserve Bank: cashier's check, certiitem provides that it must be presented for acceptance; fied check, or other bank draft or obligation. (2) the item is payable elsewhere than at the residence or place of business of the payor; or (3) the date of (d) Handling of payment. A Reserve Bank may payment of the item depends on presentment for ac- handle a bank draft or other form of payment it receptance. Documents accompanying a noncash item ceives in payment of a cash item as a cash item. A shall not be delivered to the payor upon acceptance of Reserve Bank may handle a bank draft or other form the item unless the sender specifically authorizes de- of payment it receives in payment of a noncash item as livery. A Reserve Bank shall not have or assume any either a cash item or a noncash item. other obligation to present or to send for presentment for acceptance any noncash item. (e) Liability of Reserve Bank. A Reserve Bank shall not be liable for the failure of a collecting bank, paying Section 210.9—Payment bank, or nonbank payor to pay for an item, or for any loss resulting from the Reserve Bank's acceptance of (a) Cash items. A paying bank becomes accountable any form of payment other than cash authorized in for the amount of a cash item received directly or in- paragraphs (a), (b), and (c) of this section. A Reserve directly from a Reserve Bank, at the close of the pay- Bank that acts in good faith and exercises ordinary ing bank's banking day on which it receives3 the item if care shall not be liable for the nonpayment of, or failit retains the item after the close of that banking day, ure to realize upon, a bank draft or other form of payunless, prior to that time, it pays for the item by: ment that it accepts under paragraphs (a), (b), and (c). (1) debit to an account on the Reserve Bank's books; Section 210.10—Time Schedule and Availability (2) cash; or of Credits for Cash Items (3) in the discretion of the Reserve Bank, any other form of payment. (a) Each Reserve Bank shall include in its operating circulars a time schedule for each of its offices indicating when the amount of any cash item received by it (or sent direct to another Reserve office for the ac- 3. A paying bank is deemed to receive a cash item on its next banking day if it receives the item: count of that Reserve Bank) is counted as reserve for (1) on a day other than a banking day for it; or purposes of Part 204 of this chapter (Regulation D) and (2) on a banking day for it, but becomes available for use by the sender. The Reserve (i) after its regular banking hours; (ii) after a "cut-off hour" established by it in accordance with State Bank shall give either immediate or deferred credit in law; or accordance with its time schedule to a sender other (iii) during afternoon or evening periods when it is open for limited functions only. than a foreign correspondent. A Reserve Bank ordi- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 895 narily gives credit to a foreign correspondent only (1) returns the item before midnight of its next when the Reserve Bank receives payment for the item banking day following the banking day of receipt; or in actually and finally collected funds, but, in its dis- (2) takes any other action to recover the payment cretion, a Reserve Bank may give immediate or de- within the times and by the means provided by State ferred credit in accordance with its time schedule, law. (b) Notwithstanding its time schedule, a Reserve Bank may refuse at any time to permit the use of credit The rules or practices of a clearinghouse through given for any cash item for which the Reserve Bank which the item was presented, or a special collection has not yet received payment in actually and finally agreement under which the item was presented, may collected funds. not extend these return times, but may provide for a shorter return time. Section 210.11 — Availability of Proceeds of Noncash Items; Time Schedule (b) Paying bank's warranties and agreement. A paying bank that obtains a credit or refund for the amount (a) Availability of credit. A Reserve Bank shall give of a payment it has made for a cash item: credit to the sender for the proceeds of a noncash item (1) warrants to the Reserve Bank (and to a subwhen it receives payment in actually and finally col- sequent collecting bank, and to the sender and all lected funds (or advice from another Reserve Bank of prior parties) that it took all action necessary to ensuch payment to it). The amount of the item is counted title it to recover its payment within the time limits as reserve for purposes of Part 204 of this chapter of: (i) this subpart; (ii) State law, unless a longer (Regulation D) and becomes available for use by the time is afforded by this subpart; (iii) the rules or sender when the Reserve Bank receives the payment practices of any clearing house through which the or advice, except as provided in paragraph (b) of this item was presented; and (iv) any special collection section. agreement under which the item was presented; and (2) agrees to indemnify the Reserve Bank for any (b) Time schedule. A Reserve Bank may give credit loss or expense sustained (including attorneys' fees for the proceeds of a noncash item subject to payment and expenses of litigation) resulting from the Rein actually and finally collected funds in accordance serve Bank's giving the credit or refund to the paywith a time schedule included in its operating circu- ing bank, or charging, or obtaining a refund from, lars. The time schedule shall indicate when the pro- the sender. ceeds of the noncash item will be counted as reserve for purposes of Part 204 in this chapter (Regulation D) A Reserve Bank shall not have or assume any responand become available for use by the sender. A Reserve sibility for determining whether the action taken by a Bank may, however, refuse at any time to permit the paying bank was timely. use of credit given for a noncash item for which the Reserve Bank has not yet received payment in actually Section 210.13—Chargeback of Unpaid Items and finally collected funds. (a) Right of chargeback. If a Reserve Bank does not (c) Handling of payment. If a Reserve Bank receives, receive payment in actually and finally collected funds in payment for a noncash item, a bank draft or other for an item for which the Reserve Bank gave credit form of payment that it elects to handle as a noncash subject to payment in actually and finally collected item, the Reserve Bank shall neither count the pro- funds, the Reserve Bank shall charge back the amount ceeds as reserve for purposes of Part 204 of this chap- of the item to the sender, whether or not the item itself ter (Regulation D) nor make the proceeds available for can be returned. In the event of chargeback, neither use until it receives payment in actually and finally col- the owner or holder of the item nor the sender shall lected funds. have any interest in any reserve balance or other funds of the paying bank or a collecting bank in the Reserve Section 210.12—Return of Cash Items Bank's possession. (a) Recovery of payment. A paying bank that receives (b) Suspension or closing of bank. A Reserve Bank a cash item directly or indirectly from a Reserve Bank, shall not pay or act on a draft, authorization to charge, other than for immediate payment over the counter, or other order on a reserve balance or other funds in its and that pays for the item as provided in section possession after it receives notice of suspension or 210.9(a) of this subpart, may recover the payment if, closing of the bank making the payment for that bank's before it has finally paid the item, it: own or another's account. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

896 Federal Reserve Bulletin • November 1980 Section 210.14-Extension of Time Limits (c) Item means a writing evidencing a request for the payment of money, that is handled under this subpart. If, because of interruption of communication facilities, Item does not include a item as defined in section 210.2 suspension of payments by a bank or nonbank payor, that is handled under subpart A. war, emergency conditions or other circumstances beyond its control, a bank (including a Reserve Bank) (d) Transfer item means an item: (1) sent by a transferor nonbank payor is delayed in acting on an item or (other than a Reserve Bank) to a Reserve Bank for beyond applicable time limits, its time for acting is ex- debit to the transferor's account at the Reserve Bank tended for the time necessary to complete the action, if and for credit to a transferee; (2) sent by a Reserve it exercises such diligence as the circumstances re- Bank to another Reserve Bank for credit to the latter quire. or to any other transferee; or (3) issued by a Reserve Bank at the request of a transferor for credit to a trans- Section 210.15—Direct Presentment of Certain feree. Warrants (e) Transfer request or request means a request by If a Reserve Bank elects to present direct to the payor telephone that a Reserve Bank issue a transfer item. a bill, note, or warrant that is issued and payable by a State or a political subdivision and that is a cash item (f) Transferee means a member bank, a Reserve not payable or collectible through a bank: (a) sections Bank, or other institution that (1) maintains or, if au- 210.9, 210.12, and 210.13 and the operating circulars of thorized by the Reserve Bank, uses an account at a the Reserve Banks apply to the payor as if it were a Reserve Bank and (2) is designated in a transfer item paying bank; (b) section 210.14 applies to the payor as or request to receive the amount of the item or it it were a bank; and (c) under section 210.9 each day request. on which the payor is open for the regular conduct of its affairs or the accommodation of the public is con- (g) Transferor means a member bank, a Reserve sidered a banking day. Bank, or other institution that maintains or uses an account at a Reserve Bank and that is authorized by that Subpart B-Wire Transfers of Funds Reserve Bank to send a transfer item or request to it. Section 210.25—Authority, Purpose, and Scope (h) Transferor's account or transferee's account means the account at its Reserve Bank maintained or The Board of Governors of the Federal Reserve Sys- used by the transferor or transferee, respectively. tem (''Board") has issued this subpart pursuant to the Federal Reserve Act, section 13 (12 U.S.C. § 342), (i) Transferor's Reserve Bank or transferee's Reserve paragraph (f) of section 19 (12 U.S.C. § 464), para- Bank means the Reserve office at which the transfergraph 14 of section 16 (12 U.S.C. § 248(o)), paragraphs or or transferee, respectively, maintains or uses an ac- (i) and (j) of section 11 (12 U.S.C. §§ 248(i) and (j)), count. and other laws. This subpart governs the handling by Federal Reserve Banks ("Reserve Banks") of transfer Section 210.27—General Provisions items and transfer requests. Its purpose is to provide rules for the wire transfer of funds. (a) General. Each Reserve Bank shall receive and handle transfer items, and shall itself issue transfer Section 210.26—Definitions items, in accordance with this subpart. Each Reserve Bank shall issue an operating circular governing the As used in this subpart, unless the context otherwise details of its funds transfer operations and other matrequires: ters deemed appropriate by the Reserve Bank. The circulars may, among other things: set minimum and (a) Beneficiary means a person or organization, other maximum dollar amounts; specify format and authenthan the transferee, designated in a transfer item or tication requirements for transfer items and requests; request to receive the amount of the item or request and impose reasonable funds transfer charges. from the transferee. (b) Binding effect. This subpart and the operating cir- (b) Interoffice transaction means a transfer between a culars of the Reserve Banks are binding on transfertransferor and transferee that do not maintain or use ors, transferees, beneficiaries, and other parties interaccounts at the same office of a Reserve Bank. ested in an item. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 897 (c) Government transferors and transferees. Except (1) to credit promptly the beneficiary's account or as otherwise provided by statutes of the United States, otherwise make the amount available to the benor regulations issued or arrangements made there- eficiary; or under, this subpart and the operating circulars of the (2) to notify promptly its Reserve Bank if it is un- Reserve Banks apply to the following when acting as a able to do so because of circumstances beyond its transferor or transferee: a department, agency, instru- control. mentality, independent establishment, or office of the United States, or a wholly owned or controlled Government corporation, that maintains or uses an ac- Section 210.31 —Sending Transfer Items and count with a Reserve Bank. Requests Section 210.28—Media for Transfer Items and (a) A transferor (other than a Reserve Bank) may send Requests a transfer item to, or make a transfer request of, its Reserve Bank. A Reserve Bank may refuse to act on, (a) Transfer items. A transferor may issue and send a or may impose conditions to its acting on, a transfer transfer item in any of the following media, if specified item or request if it has reason to believe that the balin the operating circular of the transferor's Reserve ance in the transferor's account is not sufficient to cov- Bank: er the item or request. The transferor shall arrange to (1) a letter, memorandum, or similar writing; have in its account, at the end of its Reserve Bank's (2) a telegram (including TWX, TELEX, or similar banking day, a balance of actually and finally collected form of communication); and funds sufficient to cover the amounts of transfer items (3) any form of communication, other than voice, debited to the account during that day. In addition to registered on (or in form suitable for being registered other remedies, the Reserve Bank has a security interon) magnetic tape, disc, or other medium designed est in the transferor's assets in the possession of, or to contain in durable form conventional signals used held for the account of, the Reserve Bank if: for electronic communication of messages. (1) the balance in the transferor's account at the end of the Reserve Bank's banking day is not sufficient (b) Transfer requests. A transferor may make transfer to cover the amounts debited to the account during requests only under special arrangements with its Re- that day; or serve Bank. The Reserve Bank may record these tele- (2) the transferor suspends payment or is closed at phone messages. any time during the Reserve Bank's banking day, and does not have a balance sufficient to cover the Section 210.29—Transferor's Agreement amounts debited to its account. (b) A Reserve Bank may send a transfer item to, or A transferor, by sending a transfer item or making a make a transfer request of, another Reserve Bank. transfer request to its Reserve Bank, authorizes: (a) its Reserve Bank to debit the amount to the Section 210.32—Handling Transfer Items and transferor's account, and to handle the transfer item Requests or request in accordance with this subpart and the operating circulars of the Reserve Banks; and (a) Intraoffice transactions. If the transferor and (b) the transferee's Reserve Bank to handle a transferee maintain or use accounts at the same Rematching transfer item (matching as to amount, serve office, that office shall act on a transfer item by transferee, and beneficiary, if any) in accordance debiting and crediting their accounts. The Reserve ofwith this subpart and the operating circulars of the fice shall act on a transfer request by issuing a transfer transferee's Reserve Bank. item, and debiting and crediting the accounts. Section 210.30—Transferee's Agreement (b) Interoffice transactions. The transferor's Reserve Bank shall handle an interoffice transaction by debiting (a) A transferee (other than a Reserve Bank), by main- the transferor's account and, acting as a transferor, istaining or using an account at a Reserve Bank, autho- suing and sending to the transferee's Reserve Bank a rizes its Reserve Bank to credit the amount of the matching transfer item (matching as to amount, transtransfer item to its account. feree, and beneficiary, if any). The transferee's Re- (b) A transferee (other than a Reserve Bank) that re- serve Bank shall transfer funds to the transferee by ceives a transfer item, or advice of credit of a transfer debiting the account of the transferor's Reserve Bank, item, designating a beneficiary, agrees: and crediting the transferee's account. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

898 Federal Reserve Bulletin • November 1980 (c) Notice of delay. If a Reserve Bank learns that it is cease acting on a transfer item or request if it receives unable to effectuate a transfer of funds on a timely from the transferor a request for revocation in time to basis for any reason, it shall notify the transferor of the give the Reserve Bank a reasonable opportunity to delay within a reasonable time. comply. If the request is received too late, the Reserve Bank may, on request from the transferor, ask the Section 210.33—Time Limits transferee to return the funds. In an interoffice transaction, the Reserve Bank may ask the transferee's Re- (a) Time schedule. Each Reserve Bank shall include in serve Bank to ask the transferee to return the funds. its operating circular a schedule showing the hours during which it handles transfer items and requests. (b) Erroneous transfer. In an erroneous or irregular transfer of funds, a Reserve Bank may, on its own ini- (b) Acting seasonably. A Reserve Bank acts season- tiative or at the request of another Reserve Bank, ask ably if it takes proper action on the day it receives a the transferee to return funds previously transferred. transfer item or request. Taking proper action within a reasonably longer time may be seasonable but the Re- Section 210.36—Final Payment; Use of Funds serve Bank has the burden of so establishing. No Reserve Bank shall represent that it will complete a trans- (a) Final payment. A transfer item is finally paid when fer of funds on the day requested. the transferee's Reserve Bank sends the transfer item or sends or telephones the advice of credit for the item (c) Transfers after closing hour. A Reserve Bank is to the transferee, whichever occurs first. not required to act on the day it receives an item or request if it receives the item or request after the time (b) Right to use funds. Credit given by a Reserve shown in its schedule. In emergency or other unusual Bank for a transfer of funds becomes available for use circumstances, a Reserve Bank may handle a transfer when the transfer item is finally paid, subject to the item or request after the time shown in its schedule. Reserve Bank's right to apply the transferred funds to The completion of an interoffice transaction in these an obligation owed to it by the transferee. circumstances is also discretionary with the transferee's Reserve Bank. Section 210.37—Timeliness of Action (d) As of adjustments. If a Reserve Bank fails to credit If, because of circumstances beyond its control, a Reto the transferee's account on the day requested the serve Bank is delayed beyond the time limits provided amount of a transfer item or request received by the in this subpart, in its operating circular, or by law in Reserve Bank before the time shown in its schedule, acting on a transfer item or request, the time for acting the Reserve Bank shall, unless otherwise instructed, is extended for the time necessary to complete the accomplete the transfer on its next banking day and tion, if the Reserve Bank exercises such diligence as make adjustments for reserve accounting purposes as the circumstances require. of the day the transfer was to have been made. Section 210.38—Reserve Bank Liability Section 210.34—Advices of Credit and Debit (a) Limitations on liability. A Reserve Bank shall not (a) Advice of credit. The transferee's Reserve Bank have or assume any responsibility to a transferee, benshall give advice of credit to the transferee for an exe- eficiary, or other party, except its immediate transfercuted transfer of funds. or. A Reserve Bank shall not be liable for the insolvency, neglect, misconduct, mistake, or default of (b) Advice of debit. After receiving a transfer item or another bank or person, including a transferor, except request, the transferor's Reserve Bank shall send an as provided in this section. A Reserve Bank shall not advice of debit to the transferor. A transferor is have or assume any liability except for its own or andeemed to approve the accuracy of an advice of debit other Reserve Bank's lack of good faith or failure to unless it sends to its Reserve Bank written objection exercise ordinary care. within 10 calendar days of receiving the advice of debit. (b) Damages. A Reserve Bank is liable to its immediate transferor for damages proximately caused by a Section 210.35—Revocation of Transfer Items failure to credit the amount of a transfer item or and Requests request to the transferee's account caused by a Reserve Bank's failure to exercise ordinary care or to act (a) Request for revocation. A Reserve Bank may in good faith. Whether damages are proximately Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 899 caused by a Reserve Bank's failure to exercise ordi- Section 211.22—Interstate Banking Operations nary care or to act in good faith is a question of fact to of Foreign Banking Organizations be determined in each case. (a) Definitions. The definitions of section 211.2 in Sub- (c) Right of indemnity. The transferee's Reserve Bank part A apply to this section subject to the following: shall indemnify the transferor's Reserve Bank for any loss or expense sustained (including attorneys' fees (1) Agency means any office or any place of busiand expenses of litigation) as a result of the failure of ness of a foreign bank located in any State of the the transferee's Reserve Bank to exercise ordinary United States or the District of Columbia at which care or to act in good faith in an interoffice transaction. credit balances are maintained, checks are paid, or money is lent, but at which deposits may not be accepted from a citizen or resident of the United States. Obligations shall not be considered credit balances unless they: (1) are incidental to, or arise AMENDMENTS TO REGULATION K out of the exercise of other lawful banking powers; . (ii) are to serve a specific purpose; (iii) are not solic- The Board of Governors has adopted amendments to ited from the general public; (iv) are not used to pay Regulation K, International Banking Operations, to routine operating expenses in the United States such implement provisions of the International Banking Act as salaries, rent, or taxes; (v) are withdrawn within a of 1978 which limit the expansion of the interstate do- reasonable period of time after the specific purpose mestic deposit-taking capabilities of foreign banks by for which they were placed has been accomplished; restricting the establishment of branches and the ac- and (vi) are drawn upon in a manner reasonable in quisition of interests in banks by a foreign bank out- relation to the size and nature of the account. side of its "home State." (2) Banking subsidiary, with respect to a specified Effective October 2, 1980, Regulation K is amended as foreign bank, means a bank that is a subsidiary as follows: the terms bank and subsidiary are defined in section 1. Regulation K is amended by adding "Subpart 2 of the BHCA (12 U.S.C. 1841). A—International Operations of United States Banking Organizations." Within Subpart A, the current (3) Commercial lending company means any organsections 211.1 through 211.7 are retained. ization, other than a bank or an organization oper- 2. Regulation K is amended by adding Subpart B. ating under section 25 of the FRA, organized under Within Subpart B, new sections 211.21 and 211.22 the laws of any State of the United States or the Disare added as follows: trict of Columbia, that maintains credit balances as may be maintained by an agency and engages in the Subpart B-Foreign Banking Organizations business of making commercial loans. Section 211.21—Authority, Purpose, and Scope (4) Domestic branch means any office or any place of business of a foreign bank located in any State of (a) Authority. This Subpart is issued by the Board of the United States or the District of Columbia that Governors of the Federal Reserve System ("Board") may accept domestic deposits and deposits that are under the authority of the Bank Holding Company Act incidental to or for the purpose of carrying out transof 1956 (12 U.S.C. 1841 et seq.) ("BHCA"); and the actions in foreign countries. International Banking Act of 1978 (92 Stat. 607) ("IBA"). (5) Foreign Bank, for purposes of this section, is an organization that is organized under the laws of a (b) Purpose and Scope. This Subpart is in furtherance foreign country and that engages in the business of of the purposes of the BHCA and the IBA. It applies to banking. foreign banks and foreign banking organizations with respect to the limitations on interstate banking under (b) Determination of home State. section 5 of the IBA (12 U.S.C. 3103); and to foreign (1) A foreign bank selecting its home State shall do banks and foreign bank holding companies with re- so by filing with the Board a declaration of home spect to the exemptions from the nonbanking prohibi- State within 180 days of the effective date of this tions of the BHCA and the IBA afforded by sections subpart. In the absence of such selection, the Board 2(h) and 4(c)(9) of the BHCA (12 U.S.C. 1841(h) and shall designate a foreign bank's home State. Within 1843(c)(9)). one year after the home State of a foreign bank has Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

900 Federal Reserve Bulletin • November 1980 been determined, unless the Board authorizes a located outside the foreign bank's home State shall longer period: give 60 days' notification to the Board prior to con- (i) the foreign bank shall close domestic branches summation of the proposed transaction. whose activities are not permissible under section (2) If, after receiving the notification, the Board 5(b) of the IB A, convert such domestic branches makes a preliminary determination within that perito agencies, or enter into an agreement with the od that the proposed acquisition would be inconsis- Board regarding the deposits of such branches as tent with the foreign bank's home State selection, prescribed in section 5(a) of the IB A; and the foreign bank shall: (ii) the foreign bank shall divest voting shares of (i) redesignate as its home State the State in interests in, or assets that are not permissible un- which its subsidiary bank is located; or der section 5(b) of the IB A. (ii) show cause why in the facts and circum- (2) A foreign bank that currently does not operate a stances of its case its home State should not be domestic branch or banking subsidiary shall not be redesignated (the foreign bank's submission may required to select a home State and shall not have its include a request for a hearing). home State designated by the Board. (3) On the basis of information available, the Board (3) A foreign bank (except a foreign bank to which shall: paragraph (b)(5) of this section applies) that has any (i) direct that the foreign bank redesignate as its combination of domestic branches, banking sub- home State the State in which its subsidiary bank sidiaries, agencies, or commercial lending company is located; or subsidiaries that, before July 27, 1978, were estab- (ii) take no action with respect to the foreign lished or applied for in more than one State may se- bank's home State. lect its home State only from those States in which (4) Factors to be considered by the Board in making the foreign bank has continuously operated such of- its preliminary and final determinations include the fices. size of the proposed acquisition relative to the for- (4) A foreign bank that established or applied for eign bank's other operations in the United States one domestic branch or one banking subsidiary be- and the ability of the foreign bank to change its fore July 27, 1978, and that was not otherwise en- home State. gaged in banking in the United States on that date, shall have as its home State the State in which such (e) Attribution of home State. domestic branch or banking subsidiary is located. (1) A foreign bank or organization and the other for- (5) A foreign bank that before July 27, 1978, had no eign banks or organizations over which it exercises domestic branches or banking subsidiaries or had actual control shall be regarded as one foreign bank only agencies or commercial lending companies, and shall be entitled to one home State. and, after that date, has established or establishes (2) Actual control shall be conclusively presumed to any domestic branch or banking subsidiary shall exist in the case of a bank or organization that owns have as its home State that State in which its initial or controls a majority of the voting shares of another domestic branch or banking subsidiary is located. bank or organization. (3) Where it appears to the Board that a foreign (c) Change of home State. A foreign bank may change bank or organization exercises actual control over its home State once if: the management or policies of another foreign bank (1) 30 days' prior notification of the proposed change or organization, the Board may inform the parties is filed with the Board; and that a preliminary determination of control has been (2) domestic branches established and investments made on the basis of the facts summarized in the in banks acquired in reliance on its original home communication. In the event of a preliminary deter- State selection are conformed to those that would mination of control by the Board, the parties shall have been permissible had the new home State been within 30 days (or such longer period as may be perselected as its home State originally. mitted by the Board): (i) indicate to the Board a willingness to terminate (d) Bank mergers. the control relationship; or (1) A foreign bank with one or more banking sub- (ii) set forth such facts and circumstances as may sidiaries that selects as its home State a State other support the contention that actual control does than that in which a banking subsidiary is located, not exist (and may request a hearing to contest the and that proposes to acquire through its subsidiary Board's preliminary determination); or bank all or substantially all of the assets of a bank (iii) accede to the Board's preliminary determinalarger than its subsidiary bank (in terms of deposits) tion, in which event the parties shall be regarded Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 901 as one foreign bank and shall be entitled to one (A) A depository institution may be regarded as home State. organized solely to do business with other depository institutions even if, as an incidental part to its activities, it does business to a limited extent AMENDMENTS TO REGULATION Q with entities other than depository institutions. The extent to which the institution may do busi- The Board of Governors has adopted technical amend- ness with other entities and continue to be rements to certain provisions of its Regulation Q, Inter- garded as a bankers' bank is specified in (C) beest on Deposits, to permit member banks to pay inter- low. est on time deposits with maturities or required notice (B) A depository institution will be regarded as periods of 14 days or more beginning October 30, being owned primarily by the institutions with 1980. which it does business if 75 per cent or more of Effective October 30, 1980, Regulation Q is amended its capital is owned by other depository instituas follows: tions. The 75 per cent or more ownership rule applies regardless of the type of depository institu- 1. Sections 217.1(c)(1), (2) and (3), (d) and (e)(2); tion. 217.5(c)(2); 217.7(b) and (h) of Regulation Q and (C) A depository institution will not be regarded footnotes 1, 2 and 3 are amended by striking "30" as doing business with the general public if it and inserting "14". meets two conditions. First, the range of customers with which the institution does business must be limited to depository institutions, in- INTERPRETATION OF REGULATION D cluding subsidiaries or organizations owned by depository institutions; directors, officers or em- The Board has adopted an interpretation, with regard ployees of the same or other depository instituto the characteristics a depository institution must tions; individuals whose accounts are acquired at possess in order to qualify for the "bankers' bank" the request of the institution's supervisory auexemption from reserve requirements contained in thority due to the actual or impending failure of § 19(b)(9) of the Act. The Board also established crianother depository institution; share insurance teria to be applied to determine whether a specific funds; and depository institution trade associbankers' bank is qualified to act as a pass-through corations. Second, the extent to which the depository respondent for nonmember depository institutions that institution makes loans to, or investments in, the are subject to the Act. above entities (other than depository institutions) Effective November 13, 1980, Regulation D is cannot exceed 10 per cent of total assets, and the amended by adding a new section 204.121 as follows: extent to which it receives deposits (or shares if the institution does not receive deposits) from or Section 204.121 —Bankers' Banks issues other liabilities to the above entities (other than depository institutions) cannot exceed 10 per (a)(1) The Federal Reserve Act, as amended by the cent of total liabilities (or net worth if the insti- Monetary Control Act of 1980 (Title I of P.L. 96- tution does not receive deposits). 221), imposes Federal reserve requirements on depository institutions that maintain transaction ac- If a depository institution is unable to meet all of counts or nonpersonal time deposits. Under these requirements on a continuing basis, it will not be § 19(b)(9), however, a depository institution is not regarded as a bankers' bank and will be required to required to maintain reserves if it: satisfy Federal reserve requirements on all of its trans- (A) is organized solely to do business with other action accounts and nonpersonal time deposits. financial institutions; (b)(1) Section 19(c)(1) of the Federal Reserve Act, (B) is owned primarily by the financial institu- as amended by the Monetary Control Act of 1980 tions with which it does business; and (Title I of P.L. 96-221) provides that Federal re- (C) does not do business with the general public. serve requirements may be satisfied by the maintenance of vault cash or balances in a Federal Re- Depository institutions that satisfy all of these require- serve Bank. Depository institutions that are not ments are regarded as bankers' banks. members of the Federal Reserve System may al- (2) In its application of these requirements to specif- so satisfy reserve requirements by maintaining a ic institutions, the Board will use the following balance in another depository institution that standards: maintains required reserve balances at a Federal Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

902 Federal Reserve Bulletin • November 1980 Reserve Bank, in a Federal Home Loan Bank, or Board believes that this procedure will promote uniin the National Credit Union Administration formity of treatment for all types of bankers' banks, Central Liquidity Facility if the balances main- and provide consistent advice concerning managetained by such institutions are subsequently rial ability and financial strength from supervisory passed through to the Federal Reserve Bank. authorities that are in a better position to evaluate (2) On August 27, 1980, the Board announced the these criteria for depository institutions that are not procedures that will apply to such pass-through ar- commercial banks. rangements (45 Fed. Reg. 58099). Section 204.3(i)(l) (4) Requests for a determination as to whether a deprovides that the Board may permit, on a case-by- pository institution will be regarded as a bankers' case basis, depository institutions that are not them- bank for purposes of the Federal Reserve Act or for selves required to maintain reserves ("bankers' permission to act as a pass-through correspondent banks") to act as pass-through correspondents if may be addressed to the Federal Reserve Bank in certain criteria are satisfied. The Board has deter- whose District the main office of the depository inmined that a bankers' bank may act as a pass- stitution is located or to the Secretary, Board of through correspondent if it enters into an agreement Governors of the Federal Reserve System, Washwith the Federal Reserve to accept responsibility for ington, D.C. 20551. The Board will act promptly on the maintenance of pass-through reserve accounts in all requests received directly or through Federal Reaccordance with Regulation D (12 CFR 204.3(1)) and serve Banks. if the Federal Reserve is satisfied that the quality of management and financial resources of the institution are adequate in order to enable the institution to INTERPRETATION OF REGULATION K serve as a pass-through correspondent in accordance with Regulation D. Satisfaction of these cri- The Board of Governors has issued a final interteria will assure that pass-through arrangements are pretation of the term "agency" as defined in Subpart maintained properly without additional financial risk B, section 211.22(a)(1) of its Regulation K, Interto the Federal Reserve. national Banking Operations. (3) In order to determine uniformly the adequacy of Effective October 2, 1980 the Board has issued the managerial and financial resources, the Board will following interpretation: consult with the Federal supervisor for the type of institution under consideration. Because the Board does not possess direct experience with supervising depository institutions other than commercial Section 211.601—Status of Certain Offices for banks, and does not intend to involve itself in the Purposes of the International Banking Act direct supervision of such institutions, it will request Restrictions on Interstate Banking Operations. the National Credit Union Administration to review requests from credit unions that qualify as bankers' The Board has considered the question of whether a banks and the Federal Home Loan Bank to review foreign bank's California office that may accept deposrequests from savings and loan associations that its from certain foreign sources (e.g., a United States qualify as bankers' banks, regardless of charter or citizen residing abroad) is a branch or an agency for insurance status. (The Board, itself, will consider the purposes of the grandfather provisions of section 5 requests from all commercial banks that qualify as of the International Banking Act of 1978 (12 U.S.C. bankers' banks.) If the Federal supervisor does not § 3103(b)). The question has arisen as a result of the find the institution's managerial or financial re- definitions in the International Banking Act of branch sources to be adequate, the Board will not permit and agency, and the limited deposit-taking capabilities the institution to act as a pass-through correspon- of certain California offices of foreign banks. dent. In order to assure the continued adequacy of The International Banking Act defines agency as managerial and financial resources, it is anticipated any office ... at which deposits may not be accepted that the appropriate Federal supervisor will, on a pe- from citizens or residents of the United States, and deriodic basis, review and evaluate the managerial and fines branch as any office ... of a foreign bank ... at financial resources of the institution in order to de- which deposits are received (12 U.S.C. § 3101(1) and termine whether it should continue to be permitted (3)). Offices of foreign banks in California prior to the to act as a pass-through correspondent. It is antici- International Banking Act were generally prohibited pated that, with respect to state chartered institu- from accepting deposits by the requirement of State tions, the Federal supervisor may discuss the law that such offices obtain Federal deposit insurance request with the institution's State supervisor. The (Cal. Fin. Code § 1756); until the passage of the Inter- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 903 national Banking Act an office of a foreign bank could INTERPRETATION OF REGULATION Q not obtain such insurance. California law, however, permits offices of foreign banks, with the approval of The Board of Governors has issued an interpretation the Banking Department, to accept deposits from any of its Regulation Q, Interest on Deposits, which properson that resides, is domiciled, and maintains its vides that Regulation Q interest rate limitations do not principal place of business in a foreign country (Cal. apply to fixed rate obligations issued by bank holding Fin. Code § 1756.2). Thus, under a literal reading of companies with a stated maturity of five years or more the definitions of branch and agency contained in the and with respect to which no more than 5 percent of International Banking Act, a foreign bank's California the original principal amount of the issue may be reoffice that accepts deposits from certain foreign deemed in any one year, with a limitation of $25,000 sources (e.g., a U.S. citizen residing abroad), is a per investor per year. branch rather than an agency. Effective October 17, 1980, Regulation Q is Section 5 of the International Banking Act estab- amended by adding a new section 217.156 to read as lishes certain limitations on the expansion of the do- follows: mestic deposit-taking capabilities of a foreign bank outside its home State. It also grandfathers offices es- Section 217.156—Application of Regulation Q to tablished or applied for prior to July 27, 1978, and per- Fixed Rate Obligations Issued by the Parent mits a foreign bank to select its home State from Bank Holding Company of a Member Bank. among the States in which it operated branches and agencies on the grandfather date. If a foreign bank's (a) The Board has received a request for an interoffice that was established or applied for prior to June pretation that sections 217.1(h) and 217.7(h) of Regula- 27, 1978, is a branch as defined in the International tion Q (12 CFR §§ 217.1(h) and 217.7(h)) do not apply Banking Act, then it is grandfathered as a branch. Ac- to small denomination fixed rate obligations with limitcordingly, a foreign bank could designate a State other ed redemption features issued by bank holding comthan California as its home State and subsequently panies. The obligations in question generally have a convert its California office to a full domestic deposit- stated maturity of from 10 to 25 years, but are redeemtaking facility by obtaining Federal deposit insurance. able at the option of the holder subject to limitations as If, however, the office is determined to be an agency, to the amount that any holder may redeem in any year then it is grandfathered as such and the foreign bank (usually $25,000) and as to the aggregate amount that may not expand its deposit-taking capabilities in Cali- may be redeemed in any year (usually 5 percent of the fornia without declaring California its home State. original principal amount of the issue). In the Board's view, it would be inconsistent with (b) Sections 217.1(h) and 217.7(h) were adopted by the the purposes and the legislative history of the Inter- Board effective March 14, 1980, and apply Regulation national Banking Act to enable a foreign bank to ex- Q interest rate ceilings to certain obligations issued by pand its domestic interstate deposit-taking capabilities a member bank's parent bank holding company. Secby grandfathering these California offices as branches tion 217.1(h) specifically provides that the deposits of a because of their ability to receive certain foreign member bank includes an obligation that is: (1) issued source deposits. The Board also notes that such de- in a denomination of less than $100,000; (2) required to posits are of the same general type that may be re- be registered with the SEC; (3) issued or guaranteed in ceived by an Edge Corporation and, hence, in accord- whole or in part by the member bank's parent which is ance with section 5(a) of the International Banking a bank holding company (regardless of the use of the Act, by branches established and operated outside a proceeds); and (4) issued with an original maturity or foreign bank's home State. It would be inconsistent redemption period of four years or less. Section 217.7 with the structure of the interstate banking provisions (h) specifies the ceiling rates of interest payable on of the International Banking Act to grandfather as full such obligations. deposit-taking offices those facilities whose activities Sections 217.1(h) and 217.7(h) were adopted in view have been determined by Congress to be appropriate of the Board's concern of the potential adverse impact for a foreign bank's out-of-home State branches. the widespread issuance by bank holding companies of Accordingly, the Board, in administering the inter- principally floating rate notes with a redemption feastate banking provisions of the IBA, regards as ture aimed at the retail market was likely to have on agencies those offices of foreign banks that do not ac- deposit flows among depository institutions. The cept domestic deposits but that may accept deposits Board's concern was based on its belief that such oblifrom any person that resides, is domiciled, and main- gations, which typically are issued at rates subtains its principal place of business in a foreign coun- stantially in excess of Regulation Q ceiling rates paytry. able on time deposits of comparable maturity, were Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

904 Federal Reserve Bulletin • November 1980 competitive with consumer deposits issued by deposi- Effective December 31, 1980, the Committee tory institutions. amends Part 1204 (Interest on Deposits) by adding sec- (c) The Board believes that the obligations in question tions 109, 110 and 111 as follows: are distinguished from those that were the subject of the Board's principal concerns in two ways. First, Part 1204—Interest on Deposits they carry a fixed rate of interest; second, the amount that may be redeemed in any year is limited to 5 percent. The Board regards this limited redemption fea- Section 1204.109—Premiums Not Considered ture as having an effect similar to a sinking fund which Payment of Interest ensures that repayments are not concentrated, while at the same time preserving the long-term nature of the (a) Premiums, whether in the form of merchandise, obligation. In view of these considerations, the Board credit, or cash, given by a depository institution to a does not believe that such obligations would be a ma- depositor will be regarded as an advertising or promojor source of competition for deposits issued by de- tional expense rather than a payment of interest if: (1) pository institutions. the premium is given to a depositor only at the time of (d) Accordingly, the Board has determined that obli- the opening of a new account or an addition to, or regations issued by a member bank's parent which is a newal of, an existing account; (2) no more than two bank holding company will not be regarded as having a premiums per account are given within a 12-month peredemption period of four years or less under section riod; and (3) the value of the premium or, in the case of 217.1(h) and, thus, will not be subject to the interest articles of merchandise, the total cost (including shiprate limitations specified in section 217.7(h), if they ping, warehousing, packaging, and handling costs) have the following characteristics: (1) the obligations does not exceed $10 for deposits of less than $5,000 or possess a fixed rate of interest that does not change $20 for deposits of $5,000 or more. The costs of preduring the life of the obligation; (2) no more than 5 miums may not be averaged. Prior to the beginning of percent of the original principal amount of the issue a premium program, an executive officer of the deposimay be redeemed at the option of the holders in any tory institution must certify that the total cost of a preone year; (3) no more than $25,000 per holder may be mium, including shipping, warehousing, packaging, redeemed in any one year; and (4) the obligations pos- and handling costs, does not exceed the applicable sess a minimum stated maturity of five years or more. $10/$20 limitations and that no portion of the total cost The five year minimum maturity requirement (i.e., 25 of any premium has been attributed to development, percent higher than the current more than four year advertising, promotional, or other expenses. The certirequirement) offsets the possible 25 percent maximum fication and supporting documents must be retained by reduction (5 percent per year for five years) in the the institution in its files and must be made available to amount outstanding after five years and is regarded as the institution's primary Federal supervisory agency necessary to preserve the objective of the four year upon request. minimum maturity requirement in section 217.1(h). (b) Certifications required by paragraph (a) must con- The Board also believes that in order to ensure that tain the following language: potential purchasers are aware of the limited nature of (1) (For use with premium programs.) the redemption feature, those limitations should be prominently disclosed in any materials or solicitations I, , concerning such obligations. Name and Title of Certifying Officer and Institution do hereby certify, to the best of my knowledge and belief, that the total cost(s) of the premium(s) of- DEPOSITORY INSTITUTIONS DEREGULATION fered by this institution during a premium program COMMITTEE to be conducted from to , Amendments to Interest on Deposits Date Date 1. The Depository Institutions Deregulation Com- including the wholesale cost, shipping, warehousmittee has adopted final rules concerning the use of ing, packaging and handling costs, does (do) not expremiums, finders fees, and the prepayment of interest ceed $10 for deposits of less than $5,000 or $20 for by depository institutions. The rules adopted by the deposits of $5,000 or more. I further certify that the Committee apply only to deposits subject to interest costs of premium items have not been averaged, that rate ceiling limitations. no portion of the cost of any premium has been at- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 905 tributed to development, advertising, promotional, count drive, contest, or other incentive plan, provided or other expenses, and that this program complies in such bonuses are tied to the total amount of deposits all respects with the requirements of 12 CFR solicited and are not tied to specific, individual depos- § 1204.109. its. Signature Section 1204.111 —Prepayment of Interest and Payment of Interest in Merchandise Date (a) Interest may be paid in the form of merchandise, cash, or a credit to a deposit account. However, inter- Falsification of this document may result in a fine est on a deposit subject to deposit interest rate ceilof not more than $10,000 or imprisonment of not ings, whether in the form of merchandise, cash, or more than five years, or both. 18 U.S.C. §§ 1001, credit to an account, may not be paid by a depository 1005, 1006. institution until such interest has been earned, except (2) (For use with self-liquidating programs.) as provided in 12 CFR § 1204.110. Where merchandise is paid in lieu of cash interest, an executive officer of I, , the depository institution must certify that the total Name and Title of Certifying Officer and Institution cost of such merchandise includes shipping, warehousing, packaging, and handling costs, and that no do hereby certify, to the best of my knowledge and portion of the cost has been attributed to development, belief, that depositors are required to absorb the to- advertising, promotional, or other expenses. The costs tal costs of items sold by this institution in a self- of individual items of merchandise may not be averliquidating program to be conducted from aged. The certification and supporting documents must be retained by the institution in its files and must —to , be made available to the institution's primary Federal Date Date supervisory agency on request. including the wholesale cost, shipping, warehous- (b) Certifications required by paragraph (a) must coning, packaging and handling costs. I further certify tain the following language: that the costs of items have not been averaged, that no portion of the cost of any item has been attrib- I, , uted to development, advertising, promotional, or Name and Title of Certifying Officer and Institution other expenses, and that this program complies in all respects with the requirements of 12 CFR do hereby certify, to the best of my knowledge and § 1204.109. belief, that the total cost(s) of merchandise offered by this institution in lieu of cash interest during a program Signature conducted from to Date Date Date Falsification of this document may result in a fine includes the wholesale cost, shipping, warehousing, of not more than $10,000 or imprisonment of not packaging and handling costs, and does not exceed the more than five years, or both. 18 U.S.C. §§ 1001, maximum amount of earned interest that could have 1005, 1006. been paid in the form of cash or a credit to an account. I further certify that the costs of the items have not Section 1204.110—Finders Fees been averaged, that no portion of the cost of any item has been attributed to development, advertising, pro- Any fee paid by a depository institution to a person motional, or other expenses, and that this program who introduces a depositor to the institution must be complies in all respects with the requirements of paid in cash when paid for deposits subject to interest 12 CFR § 1204.111. rate ceilings, and will be regarded as a payment of interest to the depositor for purposes of determining Signature compliance with interest rate ceilings, except that a depository institution may pay bonuses in cash or merchandise to its employees for participating in an ac- Date Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

906 Federal Reserve Bulletin • November 1980 Falsification of this document may result in a fine of 14 and 90 days issued to other than governmental units not more than $10,000 or imprisonment of not more in denominations of less than $100,000. This is the than five years, or both. 18 U.S.C. §§ 1001, 1005, same ceiling rate of interest currently payable by mem- 1006. ber banks on time deposits of under $100,000 with original maturities (or notice periods) of 30 to 90 days. 2. The Depository Institutions Deregulation Com- In the event that the FDIC and FHLBB also authorize mittee has adopted a final rule concerning the ceiling a reduction to 14 days in the minimum maturity of time rate of interest payable on negotiable order of with- deposits, the ceiling rate of interest payable on such drawal ("NOW") accounts. Effective December 31, time deposits issued to other than domestic govern- 1980, the ceiling rate of interest payable on NOW ac- mental units will be 5V4 per cent for insured noncounts will be 5lU per cent for all institutions autho- member commercial banks, and 5V2 per cent for inrized to offer such accounts. sured mutual savings banks and savings and loan Effective December 31, 1980, the Committee associations. As in the case of member banks, the ceilamends Part 1204 (Interest on Deposits) by adding sec- ing rate of interest payable on such time deposits istion 108 as follows: sued to governmental units would be 8 per cent. In view of the fact that this action facilitates implementation of an action taken by the Board of Gover- Part 1204 —Interest on Deposits nors of the Federal Reserve System on which public comment already has been received, the Committee finds that application of the notice and public participation provisions of 5 U.S.C. § 553 to this action is Section 1204.108—Maximum Rates of Interest unnecessary and would be contrary to the public inter- Payable by Depository Institutions on Deposits est. Therefore, pursuant to its authority under Title II Subject to Negotiable Orders of Withdrawal of Public Law 96-221, 94 Stat. 142 (12 U.S.C. § 3501 et seq.), to prescribe rules governing the payment of in- No depository institution subject to the authorities terest and dividends on deposits of federally insured conferred by section 19(j) of the Federal Reserve Act commercial banks, mutual savings banks. (12 U.S.C. § 371(b)), section 18(g) of the Federal De- Effective October 30, 1980, The Committee amends posit Insurance Act (12 U.S.C. § 1828(g)), or section Part 1204 by adding section 112 as follows: 5B(a) of the Federal Home Loan Bank Act (12 U.S.C. § 1425b(a)) shall pay interest at a rate in excess of 5V4 per cent per annum on any deposit or account subject Part 1204 —Interest on Deposits to negotiable or transferable orders of withdrawal that is authorized pursuant to 12 U.S.C. § 1832(a). 3. The Depository Institutions Deregulation Com- Section 1204.112—Time Deposits of Less than mittee has adopted a final rule concerning the ceiling $100,000. rate of interest payable, effective October 30, 1980, by banks that are members of the Federal Reserve Sys- Depository institutions that are members of the Federtem on time deposits of under $100,000 with original al Reserve System may pay interest on any time dematurities (or notice periods) of 14 to 90 days. The rate posit with an original maturity or notice period of 14 established for such deposits is 5V4 per cent. days or more, but less than 90 days, at a rate not to The new maturity also applies to time deposits un- exceed 5V4 per cent. In the event the Federal Deposit der $100,000 issued by member banks. In the case of Insurance Corporation shortens the minimum required such time deposits issued to domestic governmental maturity or notice period of time deposits to 14 days, units, the current ceiling of 8 per cent (the highest rate federally insured commercial banks that are not mempayable on any fixed-ceiling category of time deposit bers of the Federal Reserve System also may pay inby any federally insured commercial bank, mutual sav- terest on such time deposits at a rate not to exceed 5V4 ings bank, or savings and loan association) will apply per cent, and federally insured mutual savings banks to new 14 to 90 day accounts (see 12 CFR 217.7(d)). may pay interest on such time deposits at a rate not to However, no ceiling rate exists for nongovernmental exceed 5V2 per cent. In the event the Federal Home unit time deposits of under $100,000 with original Loan Bank Board shortens the minimum required maturities of less than 30 days. Accordingly, the Com- maturity or notice period of time deposits to 14 days, mittee has established a ceiling rate of interest of 5V4 institutions insured by the Federal Savings and Loan per cent payable by member banks on time deposits Insurance Corporation may pay interest on such time with original maturities (or notice periods) of between deposits at a rate not to exceed 5lh per cent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 907 BANK HOLDING COMPANY AND BANK MERGER will incur some debt in connection with this proposal, ORDERS ISSUED BY THE BOARD OF GOVERNORS it appears that Applicant will have sufficient financial flexibility to meet its debt servicing requirements while Orders Under Section 3 of Bank Holding maintaining adequate capital at Bank, particularly in Company Act light of recent actions taken to strengthen Bank's managerial resources and to moderate Bank's growth. Citizens Incorporated, While no immediate changes in Bank's operations or Evans City, Pennsylvania in the services offered to its customers are anticipated to follow consummation of the proposed acquisition, Order Approving Formation of Bank Holding convenience and needs considerations are consistent Company with approval of this application. In considering this application, the Board has scruti- Citizens Incorporated, Evans City, Pennsylvania, has nized the relationship between Applicant and Bank on applied for the Board's approval under section 3(a)(1) one hand, and Citizens Transport Inc. ("Transport") of the Bank Holding Company Act (12 U.S.C. on the other, to determine whether the relationship is § 1842(a)(1)) of formation of a bank holding company such that it would enable Applicant to engage in imperby acquiring 80 percent or more of the voting shares of missible nonbanking activities, and whether the pro Citizens National Bank of Evans City ("Bank"), rata distribution of the shares of Transport by Bank in Evans City, Pennsylvania. April 1980 complies with its commitment to the Board Notice of the application, affording opportunity for to completely divest Transport. Transport was formed interested persons to submit comments, has been giv- by Bank several years ago to conduct certain courier en in accordance with section 3(b) of the Act. The time services. Under national banking law, the courier acfor filing comments has expired, and the Board has tivities of a national bank and its operations subconsidered the application and all comments received, sidiaries are limited to providing messenger services including those of the Comptroller of the Currency, in for customers of the bank. (12 C.F.R. § 7.7490.) Aclight of the factors set forth in section 3(c) of the Act cordingly, on June 15, 1979, Bank committed to the (12 U.S.C. § 1842(c)). Federal Reserve Bank of Cleveland that it would com- Applicant, a nonoperating corporation with no sub- pletely divest its control of Transport. On April 20, sidiaries, was organized for the purpose of becoming a 1980, shortly before this application was filed, Bank bank holding company through the acquisition of attempted to divest of Transport by means of a pro Bank, which holds deposits of $88.2 million.1 Bank is rata distribution of its shares to Bank's shareholders. the third largest of 14 banking organizations competing Notwithstanding the distribution of shares, it appears in the Butler banking market,2 and controls 14.5 per- that Bank has retained control of the management and cent of commercial bank deposits in that market.3 The operations of Transport since four out of Transport's proposed transaction represents a reorganization five directors are management officials of Bank. whereby ownership of Bank will be transferred from In view of the short period between the distribution individuals to a corporation owned substantially by the and the proposed acquisition of Bank by Applicant, same individuals, and principals of Applicant are not the Board would regard Applicant as controlling principals of any other banking organization. Thus, it Transport upon acquiring Bank as long as any manageappears that consummation of this proposal would ment official interlocks remain between Transport and have no adverse effect upon existing or potential com- Applicant or its subsidiary.4 The Act provides that a petition, nor would it increase the concentration of company has control over a bank or company if "the banking resources, in any relevant market. Accord- Board determines, after notice and opportunity for ingly, the Board concludes that competitive consid- hearing, that the company directly or indirectly exererations are consistent with approval of the appli- cises a controlling influence over the management or cation. policies of the bank or company."5 The Board has pre- The financial and managerial resources and future prospects of Applicant and Bank are consistent with 4. Indeed, the Board notes that if Bank had attempted to divest the approval in view of Applicant's commitment to pro- shares of Transport in the same manner after consummation of this vide Bank with additional capital. Although Applicant proposal, Applicant would be presumed under section 2(g)(3) of the Act to continue to control the shares as long as any interlocks remained. Under section 2(g)(3) of the Act, in a divestiture by a bank holding company or its subsidiary, the divesting company is presumed to continue to control the divested company if it maintains director or 1. Banking data are as of December 31, 1979, unless indicated oth- officer interlocks with it. The Board has taken the position that genererwise. ally a divestiture will not be regarded as complete unless all such inter- 2. The Butler banking market is approximated by Butler County, locks are terminated. Pennsylvania. 5. The controlling influence test of control was added to the Act in 3. Market data are as of June 30, 1979. 1970 in order to cover situations where a company has control of a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

908 Federal Reserve Bulletin • November 1980 viously recognized that a determination with respect Board concludes that Applicant should not be permitto the existence of a controlling influence is necessari- ted to retain any officer or director interlock between it ly a question of fact that requires a careful appraisal of or any affiliate and Transport if this proposal is conthe past and prospective relationships and circum- summated. stances present in a particular case.6 The Board has Based upon the foregoing and other considerations indicated that a controlling influence embraces pres- reflected in the record, the Board concludes that consures and influences, at times subtle, by which a com- summation of the proposal would be consistent with pany may be capable of influencing or controlling the the public interest, and that the application may be apaffairs of another company.7 Moreover, the Board be- proved. On the basis of the record and for the reasons lieves that in deciding whether to approve Applicant's summarized above, the application is approved, subproposal to become a bank holding company, the ject to the condition that Applicant and Bank termi- Board may legitimately consider whether Applicant nate all director and officer interlocks with Transport will be indirectly engaged in any impermissible non- by no later than Transport's next regularly scheduled banking activities, and whether Bank has honored the annual shareholders' meeting following consummation terms of its commitment to the Reserve Bank to effect of this proposal, but not later than one year following a complete divestiture of Transport. If Applicant is consummation. The transaction shall not be made beviewed as engaging in courier activities through Trans- fore the thirtieth calendar day following the effective port, upon consummation of this proposal Applicant date of this Order or later than three months after the would be in violation of the prohibitions against non- effective date of this Order, unless such period is exbanking activities of section 4 of the Act, inasmuch as tended for good cause by the Board of Governors or Transport's activities exceed those permissible for by the Federal Reserve Bank of Cleveland pursuant to bank holding companies (12 C.F.R. § 225.4(a)(12)). delegated authority. Upon examination, the Board believes that the facts By Order of the Board of Governors, effective Sepof the relationship indicate that Bank continues to be tember 29, 1980. able to exert an undue influence on Transport, and that upon consummation of the proposal, Applicant would Voting for this action: Chairman Volcker and Governors have a similar influence. In particular, it is noted that Schultz, Wallich, Partee, and Teeters. Absent and not voting: Bank founded Transport, held all of its shares and has Governors Rice and Gramley. conducted its operations for a number of years. The shareholders of Bank and Transport are identical. (Signed) GRIFFITH L. GARWOOD, Moreover, there is only one experienced director on [SEAL] Deputy Secretary of the Board. Transport's board who is not currently associated with Bank. Both Bank and Transport are located in the same town and share the name "Citizens". Accord- Crews Banking Corporation, ingly, it appears that historically, Transport and Bank Wauchula, Florida have been integrally related, and that Bank would be able to continue to exert an undue influence over Order Approving Formation of Bank Holding Transport, so long as common directors and officers Company are retained. After considering all the facts of record, the Board finds it reasonably likely that upon consum- Crews Banking Corporation, Wauchula, Florida, has mation of the proposal, Applicant may be capable of applied for the Board's approval under section 3(a)(1) exerting such a significant influence over the manage- of the Bank Holding Company Act (12 U.S.C. ment or policies of Transport through common direc- § 1842(a)(1)) (the "Act") of formation of a bank holdtors as to constitute a controlling influence within the ing company through acquisition of 100 percent of the meaning of that concept in the Act.8 Accordingly, the voting shares of Wauchula State Bank ("Bank"), Wauchula, Florida. bank but does not own 25 percent of the bank's shares or control the election of a majority of its directors. S. Rep. No. 91-1084, 91st Cong., proposal. In response, Applicant committed to reduce the number of 2d Sess. 6 (1970). Congress recognized that "under modern condi- interlocks with Transport's board to two of Transport's six directors, tions, it is entirely possible to control the affairs of a company without and submitted resolutions from the boards of directors of Bank and owning 25 percent or more of its outstanding voting shares." Id. Transport and affidavits from the two directors of Transport proposed 6. Patagonia Corporation, 63 FEDERAL RESERVE BULLETIN 288 to remain associated with Bank, to the effect that Bank would not (1971); North Platte Corporation, Board Order of August 13, 1980, at exercise any control over Transport. In view of the nature of the rela- 6. tionship between Bank and Transport, the Board disagrees with Ap- 7. Patagonia Corporation at 291; North Platte Corporation at 6. plicant's assertion that these actions are adequate to warrant a finding 8. During the processing of the application, Applicant was advised that Applicant and Bank would not be capable of controlling Transthat it may be deemed to control Transport upon consummation of the port. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 909 Notice of the application, affording opportunity for principals of an applicant control another banking orinterested persons to submit comments, has been giv- ganization, the Board, in addition to analyzing the en in accordance with section 3(b) of the act. The time one-bank holding company proposal before it, also for filing comments has expired, and the Board has considers the effects of the proposal with respect to all considered the application and all comments received affiliated organizations. As part of its analysis of the in light of the factors set forth in section 3(c) of the Act competitive effects of a proposal involving the (12 U.S.C. § 1842(c)). restructuring of a bank's ownership into corporate Applicant is a nonoperating company recently orga- form, the Board also considers the competitive effects nized for the purpose of becoming a bank holding com- of the transaction or series of transactions whereby pany by acquiring Bank (deposits of $53.5 million).1 common share ownership and/or common control of Upon acquisition of Bank, Applicant would control management and policies of formerly competing instithe 178th largest commercial banking organization in tutions was established between the subject bank and Florida, holding approximately 0.10 percent of the to- one or more banks in the market.4 tal deposits in commercial banks in the state. Bank, Consistent with precedent and in accordance with the larger of two commercial banks located in the the statutory and procedural criteria specified above, Hardee County, Florida, banking market,2 holds ap- the Board has considered the competitive effects of the proximately 76.0 percent of the total deposits in com- original transactions whereby Bank and First National mercial banks in the market. This proposal involves a became affiliated. The 1962 and 1964 stock acquisirestructuring of Bank's ownership from individuals to tions of more than 25 percent of the voting stock of a corporation owned by the same individuals. First National by one of Bank's principals resulted in First National Bank of Wauchula ("First Nation- the affiliation of the only two banks in the Hardee al"), Wauchula, Florida, the only other bank in the County market, thus putting 100 percent of the mar- Hardee County market (deposits of $17.3 million), ket's deposits under the control of the same principals. holds the remaining 24.0 percent of the total deposits The acquisition of a controlling interest in First Nain commercial banks in the market. Applicant's princi- tional by Bank's principal had the effect of eliminating pals, who have controlled Bank since 1932, also own significant competition that existed at that time be- 35.1 percent of the shares of First National, and one of tween Bank and First National, increasing the concen- Applicant's principals serves as a director of First Na- tration of banking resources within the relevant martional. Applicant's principals acquired this ownership ket, and eliminating the only independent banking in First National, which had begun operations in 1960 competitor in the market. Under these circumstances, as an independent competitor of Bank, through stock the Board is authorized to deny approval for formation acquisitions in 1962 and 1964.3 of Applicant's one-bank holding company.5 However, Section 3(c) of the Act requires the Board in every in connection with the subject application, Applicant's case to consider the financial and managerial resources principals have agreed to take certain actions that and future prospects of the company or companies and would result in the disaffiliation of the two Hardee banks concerned, and the convenience and needs of County banks within two years.6 The Board views this the community to be served. In addition to this general disaffiliation as a positive factor in its analysis of commandate, the Board is precluded from approving any proposed acquisition of a bank that (1) would result in a monopoly, or would be in furtherance of any combi- 4. Mid-Nebraska Bancshares, Inc. v. Board of Governors, No. 78nation or conspiracy to monopolize or attempt to mo- 1658 (D.C. Cir. February 15, 1980); First Lincolnwood Corporation v. Board of Governors, 560 F. 2d (1977), 439 U.S. 234 (1978); Mahaska nopolize the business of banking in any part of the Investment Co., 63 FEDERAL RESERVE BULLETIN 579 (1977); Citizens United States; or (2) may substantially lessen com- Bancorp, Inc., 63 FEDERAL RESERVE BULLETIN 1003 (1977); Hawkpetition or tend to create a monopoly or be in restraint eye Bancorporation, 64 FEDERAL RESERVE BULLETIN 315 (1978). 5. The Supreme Court in First Lincolnwood Corporation v. Board of trade in any banking market, unless the Board finds of Governors, 439 U.S. 234 (1978) upheld the Board's authority to that such anticompetitive effects are clearly out- deny approval for formation of a one bank holding company on the basis of pre-existing unfavorable considerations, notwithstanding the weighed by the convenience and needs of the commufact that such formation will neither cause nor enhance the already nity to be served. In analyzing a case within the above- existing adverse effects. Moreover, the Court of Appeals in Mid-Nedescribed standards of the Act where, as here, the braska Bancshares, Inc. v. Board of Governors, No. 78-1658 (D.C. Cir. February 15, 1980) recognized the Board's authority to deny an application based on the anticompetitive consequences resulting from the 1972 combination of control by the applicant's principal over the 1. Deposit data are as of December 31, 1979. bank to be acquired by the proposed holding company and a com- 2. The relevant banking market is approximated by Hardee Coun- peting bank. ty, Florida. 6. Mr. J. W. Crews, Sr., a principal of Applicant, has committed to 3. Applicant's principals have stated that First National was, at the immediately convey all his shares of First National to an irrevocable time of those stock acquisitions, in need of financial resources. trust, administered by an independent institutional trustee, that would Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

910 Federal Reserve Bulletin • November 1980 petitive considerations associated with the subject ap- cause by the Board, or by the Federal Reserve Bank of plication since it will serve to hasten the termination of Atlanta pursuant to delegated authority. a longstanding significantly adverse competitive situa- By order of the Board of Governors, effective Octotion. Although the Board does not condone such anti- ber 15, 1980. competitive situation to continue for any length of time, the Board is of the view that permitting a two- Voting for this action: Vice Chairman Schultz and Goveryear period for complete divestiture of the shares of nors Wallich, Partee, Teeters, Rice, and Gramley. Absent First National by Applicant's principals is appropriate and not voting: Chairman Volcker. in the circumstances of this case in light of the limited market for such shares and the actions to be taken im- (Signed) GRIFFITH L. GARWOOD, mediately by the principals to separate the ownership [SEAL] Deputy Secretary of the Board. of Bank and First National. Accordingly, under the standards set forth in section 3 of the Act, and in accordance with judicial and Board precedent, the Board Gov Financial Holdings Limited, considers the competitive considerations based upon Tel Aviv, Israel facts of record to be consistent with approval of the application. Naftali Financial Holdings Limited, In addition to analyzing competitive effects of the Tel Aviv, Israel chain of banking organizations operated by principals of an applicant, the Board also considers the entire Israel Financial Holdings Limited, chain of organizations under its multibank holding Tel Aviv, Israel company standards in analyzing the financial and managerial resources and future prospects associated with Israel Investment and Finance Corporation a one-bank holding company proposal. Based upon Limited, such an analysis in this case, the financial and manage- Tel Aviv, Israel rial resources and future prospects of Applicant, Bank and First National appear to be generally satisfactory. IDB Bankholding Corporation Limited, Therefore, considerations relating to banking factors Tel Aviv, Israel are consistent with, but lend no weight toward approval of the application. The disaffiliation of Bank and Israel Discount Bank Limited, First National is expected to enhance competition in Tel Aviv, Israel the Hardee County market, thus resulting in improved customer services and providing an independent Order Approving Formation of Bank Holding source of banking services to the community to be Companies and Retention of PEC Israel Economic served. Therefore, considerations relating to conve- Corporation nience and needs of the community to be served lend weight to approval of this application. Accordingly, it Gov Financial Holdings Limited ("Gov"), Naftali Fiis the Board's judgment that the proposed acquisition nancial Holding Limited ("Naftali"), Israel Financial is in the public interest and that the application should Holdings Limited ("Israel Financial"), Israel Investbe approved. ment and Finance Corporation Limited ("Israel In- On the basis of the record, the application is ap- vestment"), IDB Bankholding Corporation Limited proved for the reasons summarized above. The trans- ("Bankholding"), and Israel Discount Bank Limited action shall not be consummated before the thirtieth ("IDB"), (collectively, "Applicants"), all of Tel Aviv, calendar day following the effective date of this Order Israel, have applied for the Board's approval under or later than three months after the effective date of section 3(a)(1) of the Bank Holding Company Act (12 this Order, unless such period is extended for good U.S.C. § 1842(a)(1)) to become bank holding companies with respect to Israel Discount Trust Company, New York, New York ("Bank"), All Applicants but IDB have also applied for the Board's permission to immediately commence efforts to sell the First National stock with final disposal of the stock to take place no later than two years after retain the shares of PEC Israel Economic Corporation, the trust's creation. The Trust Agreement specifically prohibits sale of New York, under section 4(c)(9) of the Act (12 U.S.C. the First National stock to J. W. Crews, Sr., his lineal descendants, or § 1843(c)(9)) and section 225.4(g)(3) of the Board's any members of the families of his lineal descendants, or repurchase by the trustee. In furtherance of their efforts to separate themselves Regulation Y (12 C.F.R. § 225.4(g)(3)). from First National, Applicant's principals have committed that nei- Notice of the applications to become bank holding ther they, nor any family members, will serve on First National's Board. companies, affording opportunity for interested per- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 911 sons to submit comments and views, has been given in $1.0 billion in assets and $940.0 million in liabilities accordance with section 3(b) of the Act. The time for would be transferred to Bank from IDB's branches. In filing comments and views has expired, and the Board addition, PEC would purchase $11 million of Bank's has considered the applications and all comments re- capital stock, and would thereby acquire control of 19 ceived in the light of the factors set forth in sections percent of the voting shares of Bank. IDB would also 3(c) and 4(c)(9) of the Act (12 U.S.C. §§ 1842(c) and invest an additional $25.0 million in Bank. Thereafter, 1843(c)(9)). Bank would have two offices in New York while IDB IDB is the third largest banking organization in Is- would continue to operate its remaining New York rael and the 168th largest in the world with total assets branch. of $7.0 billion and total deposits of $6.4 billion.1 IDB Inasmuch as the proposal merely represents a reoperates 240 branches throughout Israel and has structuring of Applicants' current holdings, consumbranches and interests in a number of banking organi- mation of the proposal would have no adverse effects zations in other countries. IDB also operates two on existing or potential competition nor would it inbranches in New York and an agency in Miami. crease the concentration of banking resources in any Bankholding, which owns 91.8 percent of the shares relevant area. Accordingly, the Board concludes that of IDB, is an Israeli holding company with total assets the competitive considerations associated with the of $7.6 billion. Bankholding has controlling interests in proposal are consistent with approval of the applitwo Israeli companies2 that, through subsidiaries, en- cations. gage in business in the United States. Bankholding and The financial and managerial resources of Appliits parent companies propose to retain these com- cants and Bank are considered generally satisfactory panies and to continue indirectly to engage in business and the future prospects for each appear favorable. in the United States on the basis of section 2(h) of the Thus, banking factors are consistent with approval of Act (12 U.S.C. § 1841(h)). Bankholding also owns 87 the applications. Consummation of the proposal would percent of the shares of PEC Israel Economic Corpo- also provide the community with an additional full ration ("PEC"), a Maine corporation with offices in service bank that would serve as an alternative source New York City, that engages in providing debt and of banking services. Therefore, consummation of the equity financing to Israeli companies. As part of the transaction would have a procompetitive effect and the corporate restructuring associated with the proposal, Board concludes that considerations relating to the PEC will own 19 per cent of the shares of Bank. Bank- convenience and needs of the community to be served holding and its parent companies have applied to re- lend weight toward approval of the applications. tain their interests in PEC on the basis of section With respect to the applications to retain PEC, the 4(c)(9) of the Act. Gov, Naftali, Israel Financial, and Board notes that PEC provides debt and equity financ- Israel Investment are parent companies of Bank- ing for, and holds shares of, 20 Israeli corporations enholding. gaged in a broad range of commercial activities in Is- Bank is a New York State chartered insured bank rael. PEC also has two inactive United States that currently functions as a register and transfer subsidiaries, and holds for investment purposes preagent, acts as trustee for trust accounts, and accepts ferred shares of United States companies. In the past time and savings deposits. Bank does not presently ac- ten years, PEC's activities have been limited to incept demand deposits or make commercial loans, and creasing its equity interests in companies in which it thus is not considered a "bank" for purposes of sec- has an existing equity interest and to making dollar or tion 2(c) of the Act. The proposal represents a corpo- dollar-linked loans to affiliated companies. rate reorganization whereby Bank will assume certain While the proposed investment in Bank by PEC liabilities and acquire certain assets of the New York, would not be considered an activity incidental to Nassau, and Cayman Islands branches of IDB. Upon PEC's foreign activities, there would appear to be little consummation, Bank will become a "bank" within the reason for prohibiting the holding of Bank's shares by meaning of section 2(c) of the Act and each Applicant PEC. Applicants could cause the funds to be transwill thereby become a bank holding company within ferred from PEC to IDB which could then invest the the meaning of the Act. As proposed, approximately funds in Bank, thus serving the same purpose with greater attendant risk. As it does not appear that PEC will control Bank or that such a structure would give Applicant a competitive advantage over domestic 1. Unless otherwise noted, all banking data are as of December 31, banking organizations, it does not appear that reten- 1979. 2. Discount Bank Investment Corporation, Tel Aviv, Israel, and tion of PEC by Applicants after consummation would Clal (Israel) Limited, Tel Aviv, Israel. Clal indirectly owns four com- be at variance with the purposes of the Act. Inasmuch panies in the United States that engage ir holding real estate. Appli- as this structure will permit the channeling of funds to cants have commenced divesting these holdings. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

912 Federal Reserve Bulletin • November 1980 Bank in a more secure manner, contributing to the The Marine Corporation, safety and soundness of the overall banking organiza- Milwaukee, Wisconsin tion, it appears that the retention of PEC would also be in the public interest. Therefore, the applications to Order Approving Acquisition of Bank retain PEC after consummation of the proposal are hereby approved. The Marine Corporation, Milwaukee, Wisconsin, a Applicants have indicated that they intend to retain bank holding company within the meaning of the Bank certain indirect investments in the United States Holding Company Act, has applied for the Board's apthrough foreign nonbanking companies on the basis of proval under section 3(a)(3) of the Bank Holding Comsection 2(h) of the Act.3 In each instance, Applicants pany Act of 1956, as amended (12 U.S.C. have provided information on the size and amounts of § 1842(a)(3)), to acquire 100 percent of the voting assets and revenues of the foreign company abroad shares (less directors' qualifying shares) of First Naand of its U.S. operations, and information on whether tional Bank and Trust Company of Racine, Racine, the activity of U.S. operations is in the same general Wisconsin ("Bank"). line of business as that of the foreign nonbanking com- Notice of the application, affording opportunity for pany. From the information provided, it appears that interested persons to submit comments and views, has retention of these investments is permissible under been given in accordance with section 3(b) of the Act. section 2(h). The time for filing comments and views has expired, On May 1, 1980, the Board proposed for public com- and the Board has considered the application and all ment regulations implementing section 2(h) of the Act comments received in light of the factors set forth in (45 Federal Register 30082) and establishing the types section 3(c) of the Act (12 U.S.C. § 1843(c)). of foreign banking organizations that are eligible to Applicant, the third largest banking organization in take advantage of the exemptive provisions of section Wisconsin, controls 18 banks with total deposits of ap- 2(h). Should Applicants fail to meet the qualifications proximately $1.4 billion, representing 6.8 percent of as finally adopted, and in the absence of a specific total deposits in commercial banks in the state.1 Ac- Board determination to the contrary, Applicants will quisition of Bank ($124.7 million in deposits), the 18th be expected to conform their future direct and indirect largest banking organization in Wisconsin, would inactivities and investments to the requirements of the crease Applicant's share of statewide commercial regulations. bank deposits by 0.6 percent and Applicant would Based upon the foregoing and other considerations thereby become the second largest banking organizareflected in the record, the Board concludes that con- tion in the state. summation of the proposal would be in the public in- By Order dated March 26, 1980, the Board denied an terest and that the applications should be approved. earlier proposal by Applicant to acquire Bank. In that On the basis of the record, the applications are ap- decision the Board found that consummation of this proved for the reasons summarized above. The trans- proposal would have substantially adverse effects upactions shall not be made before the thirtieth calendar on probable future competition in the Racine banking day following the effective date of this Order or later market. The Board's Order also reflected its concern than three months after the effective date of this Or- that consummation would have upon the concentrader, unless such period is extended for good cause by tion of banking resources in Wisconsin. On May 7, the Board of Governors or by the Federal Reserve 1980, the Board granted Applicant's request that the Bank of New York pursuant to delegated authority. Board reconsider its proposal. By order of the Board of Governors, effective Octo- In its earlier decision the Board noted that the prober 16, 1980. posal would have no significantly adverse effects on existing competition. All the facts of record continue to support that determination. In the context of this Voting for this action: Vice Chairman Schultz and Governors Wallich, Partee, Teeter, Rice, and Gramley. Absent and proposal, however, the Board has determined that it not voting: Chairman Volcker. would be appropriate to re-evaluate the degree to which consummation of the proposed transaction (Signed) GRIFFITH L. GARWOOD, would adversely impact upon probable future com- [SEAL] Deputy Secretary of the Board. petition in the Racine banking market (the relevant 3. As noted in footnote 2, supra, Applicant is in the process of di- 1. Banking data are as of December 31, 1979, and reflect bank holdvesting certain real estate holdings in the U.S., and Applicants do not ing company formations and acquisitions approved as of June 30, propose to retain these holdings on the basis of section 2(h) of the Act. 1980. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 913 market),2 or the concentration of banking resources in which is comprised of mostly low and moderate in- Wisconsin, or both, in its evaluation of the competitive come neighborhoods in downtown Racine. effects of the proposal. In light of the above and other facts of record, it In its March 26 Order denying this proposal the does not appear that consummation of the proposed Board, in describing the anti-competitive effects with- transaction would so adversely affect probable future in the Racine banking market, stated that the Racine competition in the Racine banking market as to warmarket is reasonably attractive for, and capable of, rant denial of the proposal; moreover whatever adsupporting de novo entry; that there are independent verse effects are associated with this proposal are outbanks in the market that might serve as foothold entry weighed by the other considerations in the record, that points for Applicant; and that Applicant is a probable are discussed below.4 future entrant into the market. The Board's March 26 Order reflected the Board's While the Board continues to view Applicant as a concern with the effects consummation of this proprobable future entrant into the Racine market, the posal would have upon the structure of banking in Board is of the view that the evidence of record in- Wisconsin. The Board's action of this date should not dicates that the overall competitive structure of the be viewed as reflecting a decreased concern with statemarket does not require that Applicant's entry be re- wide banking structure. Instead, this decision should stricted to establishing a bank de novo or to acquiring be viewed in the context of the additional facts of reca foothold entry. Although Bank is the largest banking ord reflecting a less vigorous and meaningful comorganization in the market, it appears that Bank's size petitor than was believed by the Board to exist when it and rank in the Racine market do not properly reflect earlier denied this proposal. its competitive position and impact and therefore the Affiliation with Applicant will strengthen Bank's fieffect that consummation of this proposal would have nancial and managerial resources and thereby improve upon probable future competition in that market. its future prospects. Applicant has committed to inject The facts of record indicate that Bank has a declin- capital into Bank and to provide the necessary finaning competitive presence in the Racine banking mar- cial and managerial support to improve the financial ket. Most of the growth in the Racine banking market condition of Bank and thereby strengthen its comhas taken place in the suburban areas of the Racine petitive position in the market. Accordingly, banking RMA. Demographic data suggest that this suburban factors lend weight toward approval of the application. growth trend is likely to continue. Moreover, the num- Bank has been limited in its ability to serve the ber of Bank's time and demand deposit accounts has needs of its community and affiliation with Applicant been steadily declining over the past few years3 and its will enable Bank to better serve the needs of the Racommercial base has become narrower. In addition, cine area as well as Bank's immediate community, many of Racine's retail businesses have relocated comprised primarily of low and moderate income away from the downtown business area where Bank is neighborhoods. In addition, through its affiliation with located. Aside from Bank, most of the points of entry Applicant, Bank's overall ability to serve downtown into the market are located in the suburban areas. It is Racine should be enhanced. Affiliation with Applicant noted that Wisconsin law precludes Bank from will enable Bank to expand its services for corporate branching into the suburban areas and Applicant's ac- customers who in recent years have turned elsewhere quisition of a suburban bank would effectively pre- for their banking needs. In light of the above, the clude it from any meaningful competitive presence in Board concludes that the convenience and needs of the downtown Racine area. Therefore, under present the community to be served lend such weight toward law it appears unlikely that Bank could become a approval as to outweigh any adverse competitive efmeaningful and effective competitor outside the cen- fects that may be associated with this proposal. tral city of Racine. In the absence of an affiliation with Based on the foregoing and other considerations rean organization such as Applicant, Bank's position as flected in the record, it is the Board's judgment that a viable competitor in the market would most likely the proposed acquisition is in the public interest and continue to deteriorate, thereby reducing Bank's abili- that the application should be approved. ty to serve the needs of its immediate community, 4. While the Board's action is to approve this proposal for the reasons discussed above, the Board continues to be concerned about the 2. The Racine banking market is approximated by the Racine RMA competitive effects of an acquisition by a statewide banking organizawhich includes Mt. Pleasant, Yorkville, Dover and Rochester town- tion of one of the largest banks in a market even though the acquirer is ships, most of Caledonia township and the village of Waterford, all in not already in the relevant market. Accordingly, the Board will con- Wisconsin. tinue to monitor these situations and consider each proposal on its 3. Based on data for the period March 1976 through March 1980. own facts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

914 Federal Reserve Bulletin • November 1980 On the basis of the record the application is ap- quest by Citicorp to amend its application by adding proved for the reasons summarized above. The trans- certain activities related to data processing and transaction shall not be made before the thirtieth calendar mission, including electronic funds transfer activities, day following the effective date of this Order or later to the activities proposed to be engaged in through than three months after the effective date of this Order Citishare Corporation. The additional proposed activiunless such period is extended for good cause by the ties are generally not authorized by Regulation Y, and Board or by the Federal Reserve Bank of Chicago pur- Citicorp has requested the Board to add them to the suant to delegated authority. list of activities permissible for bank holding com- By order of the Board of Governors, effective Octo- panies. ber 3, 1980. The Board has amended its Order for Hearing of June 10, 1980, to expand the scope of the hearing to Voting for this action: Chairman Volcker and Governors consider the additional activities and the proposed rule. Schultz, Partee, and Gramley. Voting against this action: Governors Teeters and Rice. Absent and not voting: Gover- The amended Order follows. nor Wallich. Board of Governors of the Federal Reserve System, (Signed) THEODORE E. ALLISON October 30, 1980. [SEAL] Secretary of the Board. (Signed) GRIFFITH L. GARWOOD Dissenting Statement of Governors Teeters and Rice [SEAL] Deputy Secretary of the Board. We would deny this application for the reasons stated in the Board's Order dated March 26, 1980. In that Or- CITICORP, der the Board found that consummation of the pro- New York, New York posed transaction would adversely affect probable future competition in the Racine banking market and Order for Hearing would increase the concentration of banking resources in the state. We note that there are smaller independ- Citicorp, New York, New York, a bank holding coment banks in the market and that the record indicates pany within the meaning of the Bank Holding Compathe market is somewhat attractive for de novo entry. ny Act (the "Act"), has applied for the Board's ap- We are aware that Bank's market share has declined; proval under section 4(c)(8) of the Act (12 U.S.C. nonetheless Bank remains the largest bank in the mar- § 1843(c)(8)) and section 225.4(b)(2) of the Board's ket and we believe it would be more pro-competitive Regulation Y (12 C.F.R. § 225.4(b)(2)) to engage in for Applicant to enter the market via foothold or de certain data processing and transmission activities novo entry. through a subsidiary to be known as Citishare Moreover, we do not believe the convenience and Corporation. needs considerations associated with this proposal Under section 4(c)(8) of the Act, a bank holding outweigh these adverse competitive considerations. company or its subsidiaries may engage, with the Board's prior approval, in any activity that the board has determined "to be closely related to banking or Orders Under Section 4 of Bank Holding managing or controlling banks as to be a proper in- Company Act cident thereto." The Board must also consider whether the performance of a particular activity by a bank Bank Holding Companies and Change in Bank holding company can reasonably be expected to pro- Control duce public benefits that outweigh possible adverse effects. This section authorizes the Board to make the Amended Order for Hearing Regarding Application to determination of whether an activity is closely related Engage in Certain Data Processing and Electronic to banking by regulation. The Board used this author- Funds Transfer Activities and Possible Rulemaking ity in 1971 when it issued section 225.4(a)(8) of Regulawith Respect Thereto tion Y (12 C.F.R. § 225.4(a)(8)), permitting a bank holding company to engage in the following activities: This amends the Board's Order of June 10, 1980 (45 (i) providing bookkeeping or data processing serv- Federal Register 41533 (1980)), that granted the re- ices for the internal operations of the holding comquest by protestants to an application by Citicorp, pany and its subsidiaries, and New York, New York, that a hearing be held with (ii) storing and processing other banking, financial, respect to Citicorp's application to engage in data or related economic data, such as performing payprocessing activities through a subsidiary to be known roll, accounts receivable or payable, or billing as Citishare Corporation. The Board has granted a re- services. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 915 In 1975, the Board issued an interpretation ices include the processing of money market, trade (12 C.F.R. § 225.123(e)), stating that the purpose of information or other information typically exsection 225.4(a)(8) of Regulation Y is to permit a bank changed among financial institutions. These data holding company to process data for others of the processing and transmission systems would be dekinds banks have traditionally processed, both in con- signed for use by other banks and financial instituducting their internal operations and in accommodat- tions and would be provided primarily, but not exing their customers, and to perform incidental activi- clusively, to such institutions. ties necessary to carry on permissible data processing 5. Providing consumers with banking-related servactivities. The interpretation provides that such in- ices and the capability to access traditional banking cidental activities include, among others: services and related information, utilizing the serv- (1) Making excess computer time available to any- ices proposed in activities 3 and 4 above. This could one so long as the only involvement by the holding include providing a customer with the capability to company system is furnishing the facility and neces- perform budgeting, accounting, and tax analysis, as sary operating personnel; and well as direct banking services such as funds trans- (2) Selling a byproduct of the development of a pro- fer, at the customer's home or business estabgram for a permissible data processing activity. lishment, by linking the consumer with a depository institution. The Board interpretation excludes from the scope of 6. Providing hardware and software for authenticapermissible activities the development of programs tion of interbank and intrabank identifiers for funds either upon a holding company's own initiative or transfers and other electronic transmissions requirupon request, unless the data involved are financially ing authentication of origin or content. Citishare oriented. proposes to provide data processing and transmis- Citicorp's amended application indicates that the ac- sion services for the distribution and administration tivities proposed to be engaged in by Citishare consist of code keys required in connection with the authenof the following: tication process. 1. Providing data processing and transmission serv- 7. Providing to others byproducts resulting from ices for the internal operations of Citicorp and its permissible data processing and transmission activisubsidiaries. ties. 2. Providing to financial and other institutions data 8. Selling to others for any purpose any excess caprocessing and transmission services with respect to pacity on data processing and transmission facilities financial, banking, or other related economic data, used in connection with any of the above-mentioned such as financial models, loan analysis, accounting activities. With respect to this excess capacity, the and bookkeeping, budget and profitability analysis, only involvement of Cijishare will be the furnishing portfolio record-keeping and analysis, foreign ex- of the facilities necessary to the utilization of the exchange exposure, general ledger, bond analysis, in- cess capacity.1 ternational trade settlement, and economic forecasting. These services may be provided by Following publication of notice of the initial appliengaging in remote computer time-sharing services. cation, the Association of Data Processing Service Or- 3. Providing packaged financial systems for installa- ganizations, Inc., Arlington, Virginia, and other intertion at the site of a depository or other institutional ested organizations (collectively "Protestants") customer, for the purpose of facilitating traditional jointly filed written submissions in opposition to the banking or banking-related activities. In such case, application, and requested that the Board either deny Citishare would provide the software for such sys- the application or order a formal hearing on the applitems together with processing and terminating hard- cation.2 Protestants contended that the data processware. The customer may be linked to one or more ing activities originally proposed, other than providing data bases of Citishare or its subsidiary bank, Citi- services for Citicorp's internal operations, were not bank, N.A. within the scope of those data processing activities 4. Providing electronic data processing and transmission systems designed to facilitate banking transactions among financial or other institutions or to facilitate the exchange of banking, financial or other related economic data among them. Transaction 1. These eight items summarize Citicorp's proposal. Interested persons are invited to inspect the application at the offices of the Board of processing services include systems for the process- Governors or at the Federal Reserve Bank of New York for more ing of money transfer, foreign exchange, check detail. clearing and collection and other normal and usual 2. Other Protestants to the original application were ADP Network Services, Inc.; Comshare, Inc.; National CSS, Inc.; On-Line Sysinterbank transactions. Information exchange servtems, Inc.; Quantum Computer Services, Inc.; and, Tymshare, Inc. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

916 Federal Reserve Bulletin • November 1980 that the Board has previously determined to be per- filed after the Board had ordered a hearing to be held missible and were not otherwise "so closely related to on the application. These activities have not prebanking or managing or controlling banks as to be a viously been determined by the Board to be perproper incident thereto" within the meaning of section missible for bank holding companies. Section 225.4(a) 4(c)(8) of the Act. Protestants also alleged that the pro- of Regulation Y (12 C.F.R. § 225.4(a)), provides that a posal would result in adverse effects, such as undue bank holding company may file an application to enconcentration of resources, decreased or unfair com- gage in activities, other than those previously deterpetition, conflicts of interests, or unsound banking mined to be permissible for bank holding companies, if practices, that would not be outweighed by any benefit it is of the opinion that the proposed activity in the to the public. circumstances surrounding a particular case is closely With regard to the permissibility of the data process- related to banking or managing or controlling banks. ing activities originally proposed, Protestants chal- The regulation further provides that the Board will lenged, for example, the proposed sale of excess com- publish in the Federal Register a notice of opportunity puter time and time-sharing services as means for for hearing regarding the proposed activity only if it evading restrictions on processing non-financially re- believes that there is a reasonable basis for the bank lated data. Protestants contended that data processing holding company's opinion. technology has progressed over the past few years so Under guidelines established by a federal circuit as to enable a data processor to tailor its computer ca- court,3 an activity may be found to be closely related pacity to eliminate the need for any significant amount to banking if it is demonstrated (1) that banks generally of excess capacity. Furthermore, Protestants con- have in fact provided the proposed service; or (2) that tended that since a purchaser of the proposed time- banks generally provide services that are operationally sharing service would have a computer terminal on its or functionally so similar to the proposed services as own site, it would not be possible to monitor the pur- to equip them particularly well to provide the prochaser's use of the computer services to prevent the posed service; or (3) that banks generally provide servimpermissible processing of non-financially oriented ices that are so integrally related to the proposed servdata. Although Citicorp disputed Protestants' claims, ice as to require their provision in a specialized form.4 neither Citicorp nor Protestants presented sufficient The Board has previously found the National Courier evidence to prove or disprove these contentions. In guidelines useful in determining whether there is a reathe Board's judgment, these questions of fact, material sonable basis for an applicant's opinion that a proto the Board's decision on the application, remained in posed new nonbanking activity is closely related to dispute and unresolved by the parties' written sub- banking.5 missions. Accordingly, the Board believed it appropri- Since the Board has determined that a hearing ate to order a formal hearing on the original should be held with respect to other aspects of Citiapplication. corp's proposal, and since many of the proposed new In addition, Protestants claimed that many of the activities are comprised of several services, and there proposed data processing services were not the kinds does appear to be a reasonable basis for concluding of activities traditionally performed by banks. Protes- that some of these services are closely related to banktants asserted that technological developments in the ing, the Board believes that it would also be desirable industry have advanced the scope of data processing to address the question of whether these activities are activities, including those proposed by Citicorp, "so closely related to banking or managing or conbeyond that contemplated by the Board in 1971 when trolling banks as to be a proper incident thereto." Unit determined such activities to be permissible for bank der the Board's Regulation Y, the Board's decision to holding companies. The Board stated that it would be publish notice of, or hold a hearing with respect to, a appropriate to address this issue at a hearing. proposed new activity does not obligate the Board to Finally, Protestants alledged that consummation of the proposal would result in adverse effects, especially 3. National Courier Association v. Board of Governors of the Fedunfair competition and conflicts of interests, that eral Reserve System, 516 F.2d 1229 (D.C. Cir. 1976) (hereinafter referred to as "National Courier"). would not be outweighed by any benefit to the public. 4. These guidelines have been followed by other Federal Circuit While these allegations would not, standing alone, Courts of Appeals. NCNB Corporation v. Board of Governors of the Federal Reserve System, 599 F.2d 609 (4th Cir. 1979); Association of warrant a hearing, the Board concluded that all out- Bank Travel Bureaus, Inc. v. Board of Governors of the Federal Restanding issues in this matter should be resolved in one serve System, 568 F.2d 549, 551 (7th Cir. 1978); Alabama Association proceeding. of Insurance Agents v. Board of Governors of the Federal Reserve System, 553 F.2d 224, 241 (5th Cir. 1976), rehearing denied 558 F.2d The proposed activities of transmitting data and of 729 (1977), cert, denied 435 U.S. 904 (1978). providing facilities such as hardware in connection 5. E.g., NCNB Corporation (Superior Insurance Company and Suwith data processing and transmission services were perior Claim Service), 64 FEDERAL RESERVE BULLETIN 506, 507 (1978); affd sub nom. NCNB Corporation v. Board of Governors of proposed in an amendment to Citicorp's application the Federal Reserve System, 599 F.2d 609 (4th Cir. 1979). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 917 ultimately determine that the activity is closely related Heritage Banks, Inc., to banking or that the activity is permissible for bank Rochester, New Hampshire holding companies. Accordingly, it is hereby ordered, That a hearing Order Approving Establishment of Branch of with respect to this application and proposed rule be Rochester Savings Bank and Trust Company held before an Administrative Law Judge to be designated by the Office of Personnel Management. Such Heritage Banks, Inc., Rochester, New Hampshire, a hearing shall be conducted in compliance with the bank holding company within the meaning of the Bank Board's Rules of Practice for Hearings (12 C.F.R. Part Holding Company Act, has applied for the Board's ap- 263); however, the Administrative Law Judge shall es- proval under section 4(c)(8) of the Act (12 U.S.C. tablish a schedule whereby Citicorp and Protestants § 1843 (c)(8)) and section 225.4(b)(2) of Regulation Y shall submit their direct and rebuttal testimony in writ- (12 C.F.R. § 225.4(b)(2)) to engage in guaranty savings ten form. Public, oral cross examination shall then bank activities at a new branch of its subsidiary, Rochcommence on a date designated by the Administrative ester Savings Bank and Trust Company ("Savings Law Judge at the offices of the Board of Governors, Bank"), Rochester, New Hampshire. These activities Washington, D.C., or at any other place that the Ad- include the acceptance of time and savings deposits; ministrative Law Judge may designate in the interest the extension of consumer, real estate mortgage, of fairness. The Administrative Law Judge may, in his VISA credit card, and commercial loans; and the prodiscretion, convene a prehearing conference or confer- vision of trust and notarial services. The new branch ences at any convenient time or place. would be located in Wakefield, New Hampshire, and It is further ordered, That the issues to be consid- would serve communities located in southern Carroll ered at such hearing are: (1) whether each of the activi- County and northern Strafford County, including ties proposed by Citicorp is "so closely related to Wakefield, South Ossipee, East Wolfeboro, Milton, banking or managing or controlling banks as to be a Milton Mills, and Brookfield, New Hampshire. The proper incident thereto," within the meaning of sec- Board has determined that operation of a guaranty tion 225.4(a) of Regulation Y (12 C.F.R. § 225.4(a)) savings bank is closely related to New Hampshire and section 4(c)(8) of the Bank Holding Company Act banking, and it specifically approved Applicant's ac- (12 U.S.C. § 1843(c)(8)); and (2) whether each of the quisition of Savings Bank.1 proposed activities "can reasonably be expected to Notice of the application, affording opportunity for produce benefits to the public, such as greater conve- interested persons to comment on the application, has nience, increased competition, or gains in efficiency, been duly published (45 Federal Register 49,359 that outweigh possible adverse effects, such as undue (1980)). The time for filing comments has expired, and concentration of resources, decreased or unfair com- the Board has considered the application and all competition, conflicts of interests, or unsound banking ments received in light of the factors set forth in secpractices." tion 4(c)(8) of the Act. It is further ordered, that any person desiring to give Applicant, with assets of $123.8 million on Decemtestimony, present evidence, or otherwise participate ber 31, 1979, has two subsidiaries: Savings Bank (dein these proceedings should file with the Secretary, posits of $97.9 million) and First National Bank of Board of Governors of the Federal Reserve System, Rochester ("National Bank"), Rochester, New Washington, D.C. 20551, on or before December 1, Hampshire (deposits of $16.2 million).2 Each office of 1980, a written request containing a statement of the Savings Bank shares a location with an office of Nanature of the petitioner's interest in the proceedings, tional Bank, and all these offices are located in Rochthe extent of the participation desired, a summary of ester, New Hampshire. the matters upon which the petitioner desires to give Section 4(c)(8) of the Act requires the Board to detestimony or submit evidence, and the name and iden- termine whether particular activities are closely retity of each witness who proposes to appear. Such lated to banking and whether the performance of those requests will be submitted to the designated Adminis- activities by an affiliate of a bank holding company can trative Law Judge for his disposition. reasonably be expected to produce benefits to the pub- By order of the Board of Governors, effective Octo- lic that outweigh possible adverse effect. The Board ber 30, 1980. has confirmed its determination that operation of a quaranty savings bank is closely related to New Voting for this action: Chairman Volcker and Governors Schultz, Wallich, Partee, Teeters, Rice, and Gramley. (Signed) GRIFFITH L. GARWOOD, 1. Profile Bankshares, Inc., 61 FEDERAL RESERVE BULLETIN 901 (1975). [SEAL] Deputy Secretary of the Board. 2. Deposit data are as of September 30, 1979. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

918 Federal Reserve Bulletin • November 1980 Hampshire banking. However, when it last reviewed Based on the foregoing and other considerations re- Savings Bank's operations the Board concluded that flected in the record, the Board has determined that proposals for further expansion of Applicant's tandem the balance of public interest factors specified in secoperations of its savings bank and commercial bank tion 4(c)(8) of the Act favors approval of this applisubsidiaries would probably not satisfy the public ben- cation. Accordingly, the Board has approved this apefits test prescribed by section 4(c)(8).3 As the Board plication for the reasons summarized above and in observed, the operation of a guaranty savings bank reliance upon undertakings Applicant submitted in and a commercial bank at the same location may yield connection with the application. This determination is serious adverse effects, particularly involving evasion subject to the conditions set forth in section 225.4(c) of of the legal interest rate differential between thrift in- Regulation Y (12 C.F.R. § 225.4(c)), to the condition stitutions and commercial banks. The Board has also that Applicant will not establish a commercial banking expressed concern that in some circumstances similar facility at the location of the proposed branch,7 and to adverse effects could result if offices of commonly con- the Board's authority to require such modification or trolled savings and commercial banks are established termination of the activities of a bank holding compaclose to one another or operated in close mutual sup- ny or any of its subsidiaries as the Board finds necesport of each other.4 sary to assure compliance with the provisions and pur- The Board is satisfied, however, that this proposal poses of the Act and the Board's regulations and does not entail those concerns. The branch Applicant orders issued thereunder, or to prevent evasion thereproposes to open will not be paired with an office of of. The branch shall not commence business later than National Bank. National Bank's nearest office will be three months after the effective date of this Order, un- 18 miles from the new branch, and Applicant has less that period is extended for good cause by the agreed not to establish any commercial bank facility Board or the Federal Reserve Bank of Boston purwithin the new branch's service area without the suant to delegated authority. Board's consent. In addition, Applicant will not shift By order of the Board of Governors,8 effective Sepassets and liabilities between National Bank and Sav- tember 30, 1980. ings Bank, and advertising at the proposed branch will Voting for this action: Chairman Volcker and Governors mention only services available from Savings Bank.5 Schultz, Wallich, Partee, and Teeters. Absent and not voting: On the basis of these facts and agreements, the Board Governors Rice and Gramley. does not consider the branch to be a tandem operation or to involve the risks of adverse effects associated (Signed) GRIFFITH L. GARWOOD, with such operations. [SEAL] Deputy Secretary of the Board. Provided Applicant preserves this geographic and operational separation from National Bank, there is no evidence in the record suggesting that the estab- Algemene Maatschappij Voor lishment and operation of the branch in Wakefield may Nijverheidskrediet N. V., produce undue concentration of resources, decreased Antwerp, Belgium or unfair competition, conflicts of interests, unsound banking practices, or other adverse effects, and con- Kredietbank N.V., summation of the proposal is likely to result in benefits Brussels, Belgium to the public. While numerous financial institutions now serve the Rochester-Dover banking market, Order Approving Continuation of Commercial which includes Wakefield, there are now no banking Finance and Leasing Activities facilities of any type in Wakefield.6 Applicant's de novo expansion there is expected to enhance public Algemene Maatschappij voor Nijverheidskrediet N.V. convenience materially. ("Almanij"), Antwerp, Belgium, and its subsidiary, 3. Heritage Banks, Inc., 66 FEDERAL RESERVE BULLETIN 590 (1980). 7. While this condition prohibits only the colocation of a com- 4. First Financial Group of New Hampshire, Inc., 66 FEDERAL RE- mercial banking facility and the proposed Wakefield branch, Appli- SERVE BULLETIN 594 (1980). cant has also agreed that it will not establish a branch of National 5. In the past, Savings Bank and National Bank often jointly adver- Bank within the proposed branch's service area without the consent of tised their services. the Board. Any other pairing of Savings Bank's operations with those 6. The Rochester-Dover banking market is approximated by an of National Bank could also constitute a significant alteration in Savarea encompassing Lebanon, Berwick, and South Berwick, Maine, ings Bank's activities requiring application in accordance with section and Wakefield, Brookfield, North Durham, Middleton, Milton, Farm- 225.4(c)(2) of Regulation Y. The Board in particular expects Applicant ington, Strafford, Rochester, Barrington, Somersworth, Rollinsford, to consult the Federal Reserve System to determine whether the Dover, Madbury, Lee, Durham, Nottingham, and Newmarket, New Board's prior approval would be required under this section whenever Hampshire. it forms an intention to establish any new commercial banking facility. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 919 Kredietbank N.V., Brussels, Belgium (collectively re- additional source of competition in a market.2 Accordferred to as "Applicants"), foreign banks subject to ingly, the Board views the continued presence of KB certain provisions of the Bank Holding Company Act Credit as a competitor in the markets it serves as a (the "Act"),1 have applied for the Board's approval, public benefit. pursuant to section 4(c)(8) of the Act (12 U.S.C. § As indicated above, these applications present after- 1843 (c)(8)) and section 225.4(b)(1) of the Board's Reg- the-fact requests for Board approval to continue to enulation Y (12 C.F.R. § 225.4(b)(1)), to continue to en- gage in activities that were commenced in violation of gage in commercial finance and leasing activities the Act and the Board's Regulation Y. Upon examinathrough KB Business Credit Inc. ("KB Credit"), New tion of all 'the facts and circumstances of these appli- York, New York, a de novo corporation that is a direct cations, it is the Board's view that the violation was subsidiary of Kredietbank. Such activities include inadvertent. In acting on these applications, the Board extending secured and unsecured credit to businesses has taken into consideration the fact that Applicants, and making leases of personal property in accordance upon becoming aware of the existence of the violation, with section 225.4(a)(6)(a) of Regulation Y (12 C.F.R. took steps to conform their operations to the Act by § 225.4(a)(6)(a)). These activities have been deter- filing these applications and causing KB Credit to mined by the Board to be closely related to banking cease the solicitation of new business during the pend- (12 C.F.R. §§ 225.4(a)(1) and (6)). ency of these applications. From the record, it does Notice of the applications, affording opportunity for not appear that Applicants have previously violated interested persons to submit comments, has been duly the Act, or that commencement of these activities is published (44 Federal Register 51919 (1980)). The time indicative of a pattern of disregard by Applicants of for filing comments has expired, and the Board has their obligations under the Act. In addition, Applicants considered the applications and all comments in light have taken steps to prevent violations from occurring of the public interest factors set forth in section 4(c)(8) in the future, including the initiation of a program to of the Act. monitor compliance with the Act and to educate man- Almanij performs a coordinating role in a large and agement of Applicants and KB Credit regarding the diverse group of financial institutions. It is primarily Act's restrictions. The Board expects that these acknown as the principal shareholder of Kredietbank. tions will assist Applicants in avoiding a recurrence of Kredietbank is the third largest bank in Belgium, with similar violations. In light of these and other facts of consolidated assets of $13.8 billion as of March 31, record, the Board has determined that the circum- 1980. stances of the violation do not warrant denial of the KB Credit commenced its operations on January 1, applications. 1980, without prior Board approval in violation of the Since the proposed initial investment of $2 million3 Board's Regulation Y. These applications request and anticipated later investments in KB Credit repre- Board approval for continuation of Applicants' com- sent a minimal percentage of Applicants' consolidated mercial finance and leasing activities through KB assets, it appears that the proposal would have no sig- Credit. In acting on an application pursuant to section nificant effect upon Applicants' financial condition. 4(c)(8) of the Act in situations where the necessary pri- There is no evidence that consummation of this proor Board approval was not obtained before com- posal would result in undue concentration of remencing such activities, the Board applies the same sources, decreased or unfair competition, conflicts of standards that it applies to an application to commence interests, unsound banking practices, or other adverse the activities initially. The Board analyzes the com- effects on the public interest. petitive effects of such proposals both at the time of Based upon the facts of record, including certain the acquisition of the company engaged in the activi- commitments made by Applicants, the Board has deties and at the time of the application to continue to termined that the balance of the public interest factors engage in the activities. the Board is required to consider under section 4(c)(8) The activities engaged in KB Credit were intitiated is favorable. Accordingly, the applications are hereby de novo by Kredietbank's branch in New York City. approved. This determination is subject to the condi- The Board views de novo entry as procompetitive and a positive public benefit since such entry provides an 2. E.g., Virginia National Bancshares, Inc., 66 FEDERAL RESERVE BULLETIN 668, 671 (1980). The United States Court of Appeals for the District of Columbia Circuit affirmed the Board's conclusions regarding the procompetitive nature of de novo entry in Connecticut Bankers 1. Kredietbank, a foreign bank operating a branch in New York, Ass'n v. Board of Governors, No. 79-1554 (D.C. Cir. Feb. 7, 1980). New York, and its parent company, Almanij, are subject to certain 3. Almanij directly invested $400,000 in KB Credit and Kredietprovisions of the Act by operation of section 8(a) of the International bank invested $1,480,000. Two other banks affiliated with Almanij in- Banking Act of 1978, 12 U.S.C. § 3106(a). vested $60,000 each in KB Credit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

920 Federal Reserve Bulletin • November 1980 tions set forth in section 225.4(c) of Regulation Y and 3. Aladdin became a bank holding company on Deto the Board's authority to require such modification cember 31, 1970, as a result of the 1970 Amendor termination of the activities of a holding company or ments to the BHC Act, by virtue of its ownership any of its subsidiaries as the Board finds necessary to and control at that time of more than 25 percent of assure compliance with the provisions and purposes of the outstanding voting shares of Bank, and registhe Act and the Board's regulations and orders issued tered as such with the Board on June 25, 1971. Aladthereunder or to prevent evasion thereof. din would have been a bank holding Company on By order of the Board of Governors, effective Oc- July 7, 1970, if the BHC Act Amendments of 1970 tober 28, 1980. had been in effect on that date by virtue of its ownership and control on that date of more than 25 per- Voting for this action: Chairman Volcker and Governors cent of the outstanding voting shares of Bank. Schultz, Partee, Teeters, and Gramley. Absent and not vot- 4. Aladdin has directly engaged in the operation of a ing: Governors Wallich and Rice. general insurance agency since its formation on June 15, 1964. (Signed) GRIFFITH L. GARWOOD, 5. Aladdin has not filed an application with the [SEAL] Deputy Secretary of the Board. Board, and has not otherwise obtained the Board's approval, pursuant to section 4(c)(8) of the BHC Act, to continue to engage in the operation of an in- Certifications Pursuant to the Bank Holding surance agency.2 Company Tax Act of 1976 On the basis of the foregoing information it is hereby Aladdin, Inc., certified that: Britton, South Dakota (A) Aladdin is a qualified bank holding company within the meaning of section 1103(b) of the Code, Prior Certification Pursuant to the Bank Holding and satisfies the requirements of that section; Company Tax Act of 1976 (B) The insurance agency assets that Aladdin proposes to distribute are "prohibited property" within Aladdin, Inc., Britton, South Dakota ("Aladdin") has the meaning of section 1103(c) of the Code; requested a prior certification pursuant to section 1101(a) of the Internal Revenue Code ("Code"), as amended by section 2(a) of the Bank Holding Compa- 2. Although Aladdin has not sought Board approval to retain its ny Tax Act of 1976, that its proposed divestiture of all general insurance agency activities, these activities may be among of its general insurance agency assets ("insurance as- those activities that the Board has determined to be closely related to banking under section 4(c)(8) of the BHC Act, 12 U.S.C. § 1843(c)(8). sets") currently held by Aladdin, through a tax free Effective December 5, 1979, the Board amended section 225.4(a)(9) of dividend of insurance records or a distribution of as- its Regulation Y pursuant to section 4(c)(8) of the BHC Act to include sets currently carried on the books at zero basis, to the as a permissible activity acting as insurance agent or broker with respect to any insurance sold by a bank holding company in a commusole shareholder of Aladdin, is necessary or approprinity that has a population not exceeding 5,000, provided that the prinate to effectuate section 4 of the Bank Holding Compa- cipal place of banking business of the bank holding company is located ny Act (12 U.S.C. § 1841 et seq.) ("BHC Act"). in a community having a population not exceeding 5,000. 12 C.F.R. § 225.4(a)(9). While Aladdin's insurance activities generally fall within In connection with this request, the following infor- this category, under the Board's present procedures, the question mation is deemed relevant for the purpose of issuing whether, or to what extent, Aladdin would be permitted to retain these the requested certification.1 activities would not be determinable unless and until Aladdin files an application for permission to retain the activities. In passing upon 1. Aladdin is a corporation organized under the such an application, the Board would be required to apply the second laws of South Dakota on June 15, 1964. test set forth in section 4(c)(8) and to determine whether the performance of the activities by Aladdin could "reasonably be expected to 2. On January 24, 1969, Aladdin acquired ownproduce benefits to the public, such as greater convenience, increased ership and control of 470 shares of the outstanding competition, or gains in efficiency, that outweigh possible adverse efcapital stock of the Randall State Bank, representing fects, such as undue concentration of resources, decreased or unfair competition, conflicts of interest, or unsound banking practices." In 94 percent of such shares. Aladdin acquired 100 per- the absence of favorable action on such an application, Aladdin would cent of the shares of Bank after 1973. have no authority to continue to be a bank holding company beyond December 31, 1980. The legislative history of the Tax Act does not indicate a Congressional intent that companies subject to such a divestiture requirement exhaust the possibilities for retaining the activity before being eligible for tax relief, and in view of the paramount purpose of section 4 of the BHC Act that "banking and commerce 1. This information derives from Aladdin's communications with should remain separate," S. Rep. No. 1084 , 91st Cong., 2d Sess. 12 the Board concerning its request for this certification, Aladdin's regis- (1970), it would appear that the disposition of a potentially permissible tration statement filed with the Board pursuant to the BHC Act, and activity, without first seeking approval for retention, is at least "apother records of the Board. propriate" to effectuate section 4. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 921 (C) The distribution of the insurance agency assets 24,004 and Company has acquired an additional is necessary or appropriate to effectuate section 4 of 3,444 shares.2 Company currently owns and conthe BHC Act. trols 23,524 shares, representing 98 percent of the outstanding voting shares, of Bank. This certification is based upon the representations 3. Company became a bank holding company on made to the Board of Aladdin and upon the facts set December 31, 1970, as a result of the 1970 Amendforth above. In the event that the Board should hereaf- ments to the BHC Act, by virtue of its ownership ter determine that the facts material to this certifica- and control at that time of more than 25 percent of tion are otherwise than as represented by Aladdin or the outstanding voting shares of Bank, and it registhat Aladdin has failed to disclose to the Board other tered as such with the Board on August 30, 1971. material facts, the Board may revoke this certification. Company would have been a bank holding company By order of the Board of Governors, acting through on July 7, 1970, if the BHC Act Amendments of 1970 its General Counsel pursuant to delegated authority had been in effect on that date by virtue of its own- (12 C.F.R. § 265.2(b)(3)), effective October 3, 1980. ership and control on that date of more than 25 percent of the outstanding voting shares of Bank. (Signed) GRIFFITH L. GARWOOD, 4. Company holds property acquired by it on or be- [SEAL] Deputy Secretary of the Board. fore July 7, 1970, the disposition of which, but for clause (ii) of section 4(c) of the BHC Act and the proviso of section 4(a)(2) of the BHC Act, would be Atwood Vacuum Machine Company, necessary or appropriate to effectuate section 4 of Rockford, Illinois the BHC Act if Company were to continue to be a bank holding company beyond December 31, 1980, Prior Certification Pursuant to the Bank Holding and which property, but for such clause and provi- Company Tax Act of 1976 so, would be "prohibited property" within the meaning of section 1103(c) of the Code. Sections Atwood Vacuum Machine Company, Rockford, Illi- 1103(g) and 1103(h) of the Code provide that any nois (''Company"), has requested a prior certification bank holding company may elect, for the purposes pursuant to section 1101(b)(1) of the Internal Revenue of part VIII of subchapter O of Chapter 1 of the Code ("Code"), as amended by section 2(a) of the Code, to have the determination of whether proper- Bank Holding Company Tax Act of 1976, that it pro- ty is "prohibited property" or is property eligible to posed divestiture of substantially all of the shares of be distributed without recognition of gain under sec- United Bank of Illinois, N.A. ("Bank"), currently tion 1101(b)(1) of the Code, made under the BHC held by Company, through the pro rata distribution of Act as if the Act did not contain clause (ii) of section the stock of Bank to Company's stockholders, is nec- 4(c) or the proviso of section 4(a)(2). Company has essary or appropriate to effectuate the policies of the represented that it will make such an election prior Bank Holding Company Act (12 U.S.C. § 1841 et seq.) to the consummation of the proposed divestiture.3 ("BHC Act"). In connection with this request, the following infor- On the basis of the foregoing information, it is heremation is deemed relevant, for purposes of issuing the by certified that: requested certification:1 (A) Company is a qualified bank holding corpora- 1. Company is a corporation organized under the tion within the meaning of subsection (b) of section laws of Illinois on July 1, 1947. 1103 of the Code, and satisfies the requirements of 2. On August 9, 1967, Company acquired own- that subsection; ership and control of 18,886 of the 20,000 outstanding voting shares of Bank, representing 94.4 percent of such shares. On July 7, 1970, Company 2. Under section 1101(c)(1) of the Code, property acquired after held 20,080 of the 20,800 outstanding voting shares July 7, 1970, generally does not qualify for the tax benefits of section of Bank, representing 96.5 percent of such shares. 1101(b) when distributed by an otherwise qualified bank holding company. Company has not claimed that any of the exceptions to this Between July 7, 1970, and the present, the total of general rule are applicable to it and has stated that the 3,444 shares of Bank's outstanding voting shares has increased to Bank it acquired after July 7, 1970, will be returned to Bank and cancelled. 3. Sections 1103(g) and 1103(h) require that an election thereunder be made "at such time and in such manner as the Secretary [of the 1. This information derives from Company's communications with Treasury] or his delegate may by regulations prescribe." As of this the Board concerning its request for this certification, Company's date, no final regulations have been promulgated. However, Company Registration Statement filed with the Board pursuant to the BHC Act, has agreed to comply with the temporary regulations issued by the and other records of the Board. Secretary of the Treasury. 26 C.F.R. § 7570. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

922 Federal Reserve Bulletin • November 1980 (B) the shares of Bank that Company proposes to approximately 95.0 percent of the outstanding votdistribute are all or part of the property by reason of ing shares of First National Bank of Jackson which Company controls (within the meaning of sec- ("Bank"), Jackson, Mississippi. tion 2(a) of the BHC Act) a bank or bank holding 2. First Capital became a bank holding company on company, and December 31, 1970, as a result of the 1970 Amend- (C) distribution to the shareholders of Company of ments to the BHC Act, by virtue of its ownership the shares of Bank is necessary or appropriate to and control at that time of more than 25 percent of effectuate the policies of the BHC Act. the outstanding voting shares of Bank, and registered as such with the Board on June 23, 1971. First This certification is based upon the representations Capital would have been a bank holding company on made to the Board by Company and upon the facts set July 7, 1970, if the BHC Act Amendments of 1970 forth above. In the event the Board should hereafter had been in effect on that date by virtue of its owndetermine that facts material to this certification are ership and control on that date of more than 25 perotherwise than as represented by Company, or that cent of the outstanding voting shares of Bank. First Company has failed to disclose to the Board other ma- Capital presently owns 1,888,111 shares, representterial facts, it may revoke this certification. ing approximately 99.2 percent of the outstanding By order of the Board of Governors acting through voting shares, of Bank. the General Counsel, pursuant to delegated authority 3. Pictures was formed in 1946 and performs photo- (12 C.F.R. § 265.2(b)(3)), effective October 31, 1980. graphic services for schools and businesses. In December 1968, First Capital acquired 0.04 percent of (Signed) GRIFFITH L. GARWOOD, the outstanding voting shares of Pictures. Between [SEAL] Deputy Secretary of the Board. December 1968, and July 7, 1970, First Capital acquired additional shares of Pictures, and as of July 7, 1970, First Capital owned and controlled 105,731 First Capital Corporation, shares representing 16.58 percent of Pictures out- Jackson, Mississippi standing voting shares. First Capital currently owns and controls 250,386 shares, representing 18.12 per- Prior Certification Pursuant to the Bank Holding cent of the voting shares, of Pictures.2 Company Act of1976. 4. First Capital holds property acquired by it on or before July 7, 1970, the disposition of which would First Capital Corporation, ("First Capital"), Jackson, be required by section 4 of the BHC Act, if First Mississippi, has requested a prior certification pur- Capital were to continue to be a bank holding comsuant to section 1101(a) of the Internal Revenue Code pany beyond December 31, 1980, and which proper- ("Code"), as amended by section 2(a) of the Bank ty is "prohibited property" within the meaning of Holding Company Tax Act of 1976 ("Tax Act"), that section 1103(c) of the Code. its proposed divestiture of 211,462 shares representing 5. First Capital has committed to terminate all inter- 15.3 percent of the outstanding voting shares, of locks so that no person holding an office or position School Pictures, Inc., ("Pictures"), Jackson, Missis- (including an advisory or honorary position) with sippi, presently held by First Capital through the pro rata distribution of such shares of First Capital's shareholders, is necessary or appropriate to effectuate section 4 of the Bank Holding Company Act ("BHC 2. Under subsection (c) of section 1101 of the Code, property acquired after July 7, 1970, generally does not qualify for the tax benefits Act") (12 U.S.C. § 1843). of section 1101(a) when distributed by an otherwise qualified bank In connection with this request the following infor- holding company. However, when such property was acquired by a mation is deemed relevant for purposes of issuing the qualified bank holding company in a transaction in which gain was not requested certification:1 recognized under section 305(a) of the Code, then § 1101(a) is applicable. First Capital has stated that with respect to the 105,731 shares 1. First Capital is a corporation organized on Au- of Pictures held as of July 7, 1970, it received an additional 105,731 gust 5, 1968, under the laws of the state of Mississip- shares in a transaction in which gain was not recognized under section 305(a) of the Code. If these shares were in fact acquired in a transacpi. On October 31, 1968, First Capital acquired own- tion in which gain was not recognized under section 305(a) of the ership and control of 1,428,134 shares, representing Code, these shares would, accordingly, be eligible for the benefits provided in section 1101(a), by virtue of section 1101(c)(1)(A) of the Code. First Capital also acquired an additional 21,224 shares of Bank after July 7, 1970. Since these shares were acquired by First Capital 1. This information derives from First Capital's communications subsequent to July 7, 1970, section 1101(c) makes these shares, as well with the Board concerning its request for this certification, First Capi- as 17,700 shares subsequently received in tax-free transactions with tal's Registration Statement filed with the Board pursuant to the Bank respect to some of the shares, ineligible for the tax benefits of section Holding Company Act, and other records of the Board. 1101(a). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 923 First Capital, or any of its subsidiaries or affiliates, In connection with this request, the following inforas a director, officer, policy-making employee or mation is deemed relevant for purposes of issuing the consultant, or who performs (directly or through an requested certification:1 agent, representative or a nominee) functions com- 1. Homewood is a corporation organized and existparable to those normally associated with such of- ing under the laws of Ohio on November 12, 1964. fice or position, will hold any such office or position 2. On June 14, 1968, Homewood, through its or perform any such function with Pictures. wholly-owned subsidiary, Equitable Development Corp. (formerly Prime Realty Corp.), purchased On the basis of the foregoing information, it is here- 2,085 shares, representing 52.1 percent of the outby certified that: standing shares of Bank. In February, 1970, Home- (A) First Capital is a qualified bank holding corpora- wood purchased an additional 460 shares, thereby tion within the meaning of section 1103(b) of the increasing its percentage of ownership in Bank to Code, and satisfies the requirements of that section; 63.6 percent of the outstanding voting shares of (B) the 211,462 shares of Pictures that First Capital Bank. On July 7, 1970, Homewood held 2,545 of the proposes to distribute to its shareholders are "pro- outstanding voting shares of Bank. Between July 7, hibited property" within the meaning of section 1970, and the present, Homewood has acquired 1103(c) of the Code; and 1,341 shares of Bank in various transactions.2 (C) the distribution of the 211,462 shares of Pictures 3. Homewood became a bank holding company on is necessary or appropriate to effectuate section 4 of December 31, 1970, as a result of the 1970 Amendthe BHC Act. ments to the BHC Act, by virtue of its direct ownership and control at that time of more than 25 per- The certification is based upon the representations cent of the outstanding voting shares of Bank, and it made to the Board by First Capital and upon the facts registered as such with the Board on January 3, set forth above. In the event the Board should hereaf- 1972. Homewood would have been a bank holding ter determine that facts material to this certification company on July 7, 1970, if the 1970 Amendments of are otherwise than as represented by First Capital or the BHC Act had been in effect on such date, by that First Capital has failed to disclose to the Board virtue of its ownership and control on that date of other material facts, it may revoke this certification. more than 25 percent of the outstanding voting By order of the Board of Governors, acting through shares of Bank. Homewood presently owns and its General Counsel, pursuant to delegated authority controls 3,886 shares, representing 97.15 percent of (12 C.F.R. § 265.2(b)(3)), effective September 29, the outstanding voting shares of Bank. 1980. 4. Ho we wood holds property acquired by it on or before July 7, 1970, the dispostion of which would (Signed) THEODORE E. ALLISON, be necessary or appropriate to effectuate section 4 [SEAL] Secretary of the Board. of the BHC Act if Homewood were to continue to be a bank holding company beyond December 31, 1980. This property is "prohibited property" within Home wood Corporation, the meaning of section 1103(c) of the Code. Columbus, Ohio 5. Homewood has committed that after the sale of Bank Shares, no person who is a director, officer or Prior Certification Pursuant to the Bank Holding policymaking employee of Homewood or its sub- Company Tax Act of 1976 sidiaries (including honorary and advisory directors) will serve in a similar capacity with Bank, Centran Home wood Corporation (formerly Franklin Corp.), or its subsidiaries. In addition, all persons affiliated Columbus, Ohio ("Homewood"), has requested a pri- with Homewood currently serving as directors, offior certification pursuant to section 6158(a) of the Inter- cers, or policymaking employees of Bank will resign nal Revenue Code ("Code"), as amended by section their positions effective as of the closing date of the 3(a) of the Bank Holding Company Tax Act of 1976 ("Tax Act"), that its proposed sale of 3,886 shares of common stock ("Bank Shares") of The Franklin 1. This information derives from Homewood's correspondence Bank, Grove City, Ohio ("Bank"), to Centran Corpo- with the Board concerning its request for this certification, Homewood's Registration Statement filed with the Board pursuant to the ration, Cleveland, Ohio ("Centran"), for cash, is nec- BHC Act, and other records of the Board. essary or appropriate to effectuate the policies of the 2. Under section 6158 of the Code, the shares of Bank acquired by Homewood after July 7, 1970, generally do not qualify for the tax ben- Bank Holding Company Act (12 U.S.C. § 1841 et seq.) efits of section 6158(a) of the Code when sold by an otherwise quali- ("BHC Act"). fied bank holding company. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

924 Federal Reserve Bulletin • November 1980 sale. Home wood has further committed that Cen- mation is deemed relevant for purposes of issuing the tran is not, nor will it be, indebted to Home wood requested certification.1 other than in the ordinary course of Bank's business 1. Lake Hamilton is a corporation organized under and that Centran is not affiliated in any way with the laws of Arkansas on October 14, 1967. On May Homewood. 30, 1969, Lake Hamilton acquired ownership and control of 76.2 percent of the outstanding voting On the basis of the foregoing information, it is here- shares of the Cleburne County Bank, Heber by certified that: Springs, Arkansas ("Bank"). (A) Homewood is a qualified bank holding corpora- 2. Lake Hamilton became a bank holding company tion within the meaning of section 1103(b) of the on December 31, 1970, as a result of the 1970 Code, and satisfies the requirements of that section; Amendments to the BHC Act, by virtue of its own- (B) 2,545 of Bank Shares are part of the property by ership and control at that time of more than 25 perreason of which Homewood controls (within the cent of the outstanding voting shares of Bank, and meaning of section 2(a) of the BHC Act) a bank; and registered as such with the Board on August 13, (C) the sale of such shares is necessary or appropri- 1971. Lake Hamilton would have been a bank holdate to effectuate the policies of the BHC Act. ing company on July 7, 1970, if the BHC Act Amendments of 1970 had been in effect on that date This certification is based upon the representations by virtue of its ownership and control on that date of and commitments made to the Board by Homewood more than 25 percent of the outstanding voting and upon the facts set forth above. In the event the shares of Bank. Lake Hamilton presently owns and Board should determine that facts material to this cer- controls 76.2 percent of the outstanding voting tification are otherwise than as represented by Home- shares of Bank. wood, or that Homewood has failed to disclose to the 3. Lake Hamilton holds the following property ac- Board other material facts or to fulfill any com- quired or activities commenced by it on or before mitments made to the Board in connection herewith, it July 7, 1970, the disposition of which would be remay revoke the certification. quired under section 4(a) of that Act if Lake Hamil- By order of the Board of Governors, acting through ton were to continue to be a bank holding company its General Counsel, pursuant to delegated authority beyond December 31, 1980, and which property or (12 C.F.R. 265.2(b)(3)), effective October 1, 1980. activities would be "prohibited property" within the meaning of section 1103(c) of the Code: (Signed) GRIFFITH L. GARWOOD, a. holding real estate consisting of approximately [SEAL] Deputy Secretary of the Board. 200 acres of timberland located in Saline County, Arkansas; b. making loans and other extensions of credit for Lake Hamilton Enterprises, Inc., its own account; Little Rock, Arkansas c. holding and servicing first mortgage loans for its own account; Prior Certification Pursuant to the Bank Holding d. operating a general insurance agency business Company Tax Act of 1976 at Bank. 4. Lake Hamilton has committed to the Board that Lake Hamilton Enterprises, Inc., Little Rock, Ar- no person holding a position as an officer, director, kansas ("Lake Hamilton"), has requested a prior cer- or employee with policy-making functions of Lake tification pursuant to section 1101(c)(2) of the Internal Hamilton or any of its subsidiaries (including honor- Revenue Code ("Code"), as amended by section 2(a) ary or advisory positions), or who performs (directly of the Bank Holding Company Tax Act of 1976 ("Tax or through an agent, representative or nominee) Act"), that its proposed divestiture of shares of a cor- functions comparable to those normally associated poration ("New Corporation") to be created and with such office or position, will hold any such office availed of solely to acquire certain nonbank property or position with New Corporation or any of its presently held by Lake Hamilton, is necessary or ap- subsidiaries. propriate to effectuate section 4 of the Bank Holding Company Act (12 U.S.C. § 1814 et seq.) ("BHC Act"). Lake Hamilton proposes to distribute shares of New Corporation on a pro rata basis to its share- 1. This information is derived from Lake Hamilton's communicaholders. tions with the Board concerning its request for this certification, Lake Hamilton's registration statement filed with the Board pursuant to the In connection with the request, the following infor- BHC Act, and other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 925 On the basis of the foregoing, it is hereby certified 1. Effective August 7, 1980, the Board issued a prior that: certification pursuant to section 1101(b) of the Code (A) Lake Hamilton is a qualified bank holding with respect to the proposed divestiture by Compacompany within the meaning of section 1103(b) ny of 3,542 shares, representing 86.3 percent of the of the Code, and satisfies the requirements of outstanding voting shares, of Bank of Wilson that section; ("Bank"), Wilson, Arkansas, then held by Compa- (B) the property described in paragraph 3 that ny, through the pro rata distribution of such shares Lake Hamilton will exchange for shares of New to Company's shareholders. Corporation is "prohibited property" within 2. The Board's Order certified that: the meaning of section 1103(c) of the Code; and A. Company is a qualified bank holding corpora- (C) the exchange of the property described in tion, within the meaning of section 1103(b) of the paragraph 3 for the shares of New Corporation Code, and satisfies the requirements of that suband the distribution to the shareholders of Lake section; Hamilton of the shares of New Corporation are B. the 3,542 shares of Bank that Company pronecessary or appropriate to effectuate section 4 poses to distribute to its shareholders are all or of the BHC Act. part of the property by reason of which Company controls (within the meaning of section 2(a) of the This certification is based upon the representations BHC Act) a bank or bank holding company; and made to the Board by Lake Hamilton and upon the C. the distribution of the 3,542 shares of Bank is facts set forth above. In the event that the Board necessary or appropriate to effectuate the purshould hereafter determine that the facts material to poses of the BHC Act. this certification are otherwise than as represented by 3. The prior certification issued on August 7, 1980, Lake Hamilton, or that Lake Hamilton has failed to was granted upon the representation of Company disclose to the Board other material facts, the Board that it would elect, for purposes of Part VIII of submay revoke this certification. chapter 0 of Chapter I of the Code, to have a deter- By order of the Board of Governors, acting through mination of whether property is "prohibited properits General Counsel pursuant to delegated authority ty" or is property eligible to be distributed without (12 C.F.R. § 265.2(b)(3)), effective October 9, 1980. recognition of gain under section 1101(b)(1) of the Code, made under the BHC Act as if such Act did (Signed) THEODORE E. ALLISON, not contain clause (ii) of section 4(c) or the proviso [SEAL] Secretary of the Board. of section 4(a)(2) thereof as provided in sections 1103(g) and 1103(h) of the Code. Company made this election by resolution on May 21, 1980. Lee Wilson & Co., 4. On August 12, 1980, Company distributed to its Wilson, Arkansas shareholders, on a pro rata basis, all of its 3,542 shares of Bank stock. Company does not currently Final Certification Pursuant to the Bank Holding hold any interest in Bank. Company Tax Act of 1976 5. Company does not directly or indirectly own, control, or have power to vote 25 percent or more of Lee Wilson & Co. ("Company"), Wilson, Arkansas, any class of voting securities of any bank or compahas requested a final certification pursuant to section ny that controls a bank. 1101(e)(2) of the Internal Revenue Code (the "Code"), 6. Company has represented that it does not control as amended by section 2(a) of the Bank Holding Com- in any manner the election of a majority of directors, pany Tax Act of 1976 (the "Tax Act"), that it has (be- or exercise a controlling influence over the managefore the expiration of the period prohibited property is ment or policies of Bank, any other bank, or any permitted under the Bank Holding Company Act (12 company that controls a bank. U.S.C. § 1841 et seq.) ("BHC Act") to be held by a On the basis of the foregoing information, it is herebank holding company) ceased to be a bank holding by certified that Company has (before the expiration of company. the period prohibited property is permitted under the In connection with this request, the following infor- BHC Act to be held by a bank holding company) mation is deemed relevant for purposes of issuing the ceased to be a bank holding company, and has disrequested certification:1 posed of all its banking property. 1. This information derives from Company's communications with Registration Statement filed with the Board pursuant to the BHC Act, the Board concerning its request for this certification, Company's and other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

926 Federal Reserve Bulletin • November 1980 This certification is based upon the representations 1970 had been in effect on such date, by virtue of its made to the Board by Company and upon the facts set ownership on that date of more than 25 percent of forth above. In the event the Board should determine the outstanding voting shares of Bank. NIA presthat facts material to this certification are otherwide ently controls 400 shares, representing 100 percent than as represented by Company, or that Company of the outstanding voting shares, of Bank. has failed to disclose to the Board other material facts, 2. NIA holds property acquired by it on or before it may revoke this certification. July 7, 1970, the disposition of which would be re- By order of the Board of Governors, acting through quired by section 4 of the BHC Act if NIA were to its General Counsel, pursuant to delegated authority remain a bank holding company beyond December (12 C.F.R. § 265.3(b)(3)), effective October 6, 1980. 31, 1980, and which property is "prohibited property" within the meaning of section 1103(a) of the (Signed) GRIFFITH L. GARWOOD, Code. [SEAL] Deputy Secretary of the Board. 3. Principals of NIA and Bank have submitted affidavits stating that they will vote the shares of Bank distributed to them only in their individual capaci- National Insurance Agency, Inc., ties and not on behalf of NIA. Pratt, Kansas 4. NIA has committed to the Board that by December 31, 1980, no person holding an office or position Prior Certification Pursuant to the Bank Holding (including an advisory or honorary position) with Company Tax Act of 1976 NIA as a director, officer, policy-making employee or management consultant, or who performs (direct- National Insurance Agency, Inc., ("NIA"), Pratt, ly or through an agent, representative or a nominee) Kansas, has requested a prior certification pursuant to functions comparable to those normally associated section 1101(b) of the Internal Revenue Code with such office or position, will hold any such office ("Code"), as amended by section 2(a) of the Bank or position or perform any such function with Bank Holding Company Tax Act of 1976, that it proposed or any of its subsidiaries or affiliates. divestiture, through a pro rata distribution to NIA's stockholders, of 400 shares of The Coats State Bank On the basis of the foregoing information, it is here- ("Bank"), Coats, Kansas, currently held by NIA, is by certified that: necessary or appropriate to effectuate the policies of (A) NIA is a qualified bank holding corporation the Bank Holding Company Act (12 U.S.C. § 1841 et within the meaning of the section 1103(b) of the seq.) ("BHC Act"). Code, and satisfies the requirements of that sub- In connection with this request, the following infor- section; mation is deemed relevant, for purposes of issuing the (B) The 400 shares of Bank that NIA proposes to requested certification:1 distribute to its shareholders are all or part of the 1. NIA is a corporation organized under the laws of property by reason of which NIA controls (within Kansas on June 20, 1955. On January 15, 1970, NIA the meaning of section 2(a) of the BHC Act) a bank; acquired ownership and control of 400 shares of and Bank,2 representing 100 percent of the outstanding (C) The distribution of such shares of Bank is necvoting shares of Bank. NIA became a bank holding essary or appropriate to effectuate the policies of the company on December 31, 1970, as a result of the BHC Act. 1970 Amendments to the BHC Act by virtue of its ownership and control at that time of more than 25 This certification is based upon the facts set forth percent of the outstanding voting shares of Bank, above. In the event the Board should hereafter deterand it registered as such with the Board on May 28, mine that facts material to this certification are other- 1971. NIA would have been a bank holding compa- wise than as represented by NIA or that NIA has ny on July 7, 1970, if the BHC Act Amendments of failed to disclose to the Board other material facts, it may revoke this certification. By order of the Board of Governors, acting through its General Counsel, pursuant to delegated authority 1. This information has been derived from NIA's communications (12 C.F.R. § 265.2(b)(3)), effective October 29, 1980. with the Board concerning its request for this certification, its Registration Statement filed with the Board pursuant to the BHC Act, and other records of the Board. 2. Although NIA controls all of the shares that are to be sold in this transaction, 25 of such shares are registered in the name of directors of (Signed) GRIFFITH L. GARWOOD, NIA. [SEAL] Deputy Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 927 Oliver Jensen Agency, Inc., On the basis of the foregoing, it is hereby certified Ravenna, Nebraska that: (A) Agency is a qualified bank holding corporation Prior Certification Pursuant to the Bank Holding within the meaning of sections 6158(f)(1) and 1103(b) Company Tax Act of 1976 of the Code and satisfies the requirements of section 1103(b); Oliver Jensen Agency, Inc., Ravenna, Nebraska (B) the shares of Realty proposed to be divested are ("Agency"), has requested a prior certification pur- "prohibited property" within the meaning of secsuant to section 6158(a) of the Internal Revenue Code tions 6158(f)(2) and 1103(c) of the Code; ("Code"), as amended by section 3(a) of the Bank (C) the sale of Realty is necessary or appropriate to Holding Company Tax Act of 1976 ("Tax Act"), that effectuate section 4 of the BHC Act. its proposed sale of 119 shares of L. T. Osborn Realty Co., Gibbon, Nebraska ("Realty"), is necessary or This certification is based upon the representations appropriate to effectuate the policies of the Bank made to the Board by Agency and upon the facts set Holding Company Act (12 U.S.C. § 1841 et seq.) forth above. In the event that the Board should hereaf- ("BHC Act"). ter determine that the facts material to this certifica- In connection with this request the following infor- tion are otherwise than as represented by Agency or mation is deemed relevant for purposes of issuing the that Agency has failed to disclose to the Board other certification.1 material facts, the Board may revoke this certification. 1. Agency is a corporation organized on January 1, By order of the Board of Governors, acting through 1966, under the laws of the State of Nebraska. On its General Counsel pursuant to delegated authority October 30, 1969, Agency acquired ownership and (12 C.F.R. § 265.2(b)(3)), effective October 9, 1980. control of 255 shares representing 51 percent of the outstanding voting shares, of Bank of Doniphan, (Signed) GRIFFITH L. GARWOOD, Doniphan, Nebraska ("Bank"). [SEAL] Deputy Secretary of the Board. 2. Agency became a bank holding company on December 31, 1970, as a result of the 1970 Amendments to the BHC Act by virtue of its ownership and Peoples Insurance Agency, Inc., control at that time of more than 25 percent of the Britton, South Dakota outstanding voting shares of Bank, and it registered as such with the Board on October 5, 1971. Agency Prior Certification Pursuant to the Bank Holding presently owns and controls 3,276 shares, represent- Company Tax Act of 1976 ing approximately 80 percent of the outstanding voting shares of Bank. Peoples Insurance Agency, Inc., Britton, South Dako- 3. On April 1, 1968, Agency acquired ownership ta ("Peoples"), has requested a prior certification purand control of 119 shares, representing 70 percent of suant to section 1101(a) of the Internal Revenue Code the voting shares of Realty. ("Code"), as amended by section 2(a) of the Bank 4. Realty is engaged in the business of a general in- Holding Company Tax Act of 1976, that its proposed surance agency and other activities. Agency holds divestiture of all of its general insurance agency asproperty acquired by it on or before July 7, 1970, the sets ("insurance assets") currently held by Peoples, disposition of which would be necessary or appro- through a tax free dividend of insurance records or a priate to effectuate section 4 of the BHC Act if distribution of assets currently carried on the books at Agency is to remain a bank holding company zero basis, to the two shareholders of Peoples, is necbeyond December 31, 1980, and which property is essary or appropriate to effectuate section 4 of the "prohibited property" within the meaning of section Bank Holding Company Act (12 U.S.C. § 1841 et seq.) 1103(c) of the Code. ("BHC Act"). 5. No officer, director or employee with policy- In connection with this request, the following informaking functions of Agency or any of its sub- mation is deemed relevant for the purpose of issuing sidiaries holds or will hold any such position with the requested certification.1 Realty or any of its subsidiaries. 1. This information derives from Agency's communications with 1. This information derives from Peoples' communications with the the Board concerning its request for this certification, Agency's Board concerning its request for this certification, Peoples' Registration Statement filed with the Board pursuant to the BHC Act, registration statement filed with the Board pursuant to the BHC Act, and other records of the Board. and other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

928 Federal Reserve Bulletin • November 1980 1. Peoples is a corporation organized under the laws On the basis of the foregoing information it is hereby of South Dakota on August 22, 1962. certified that: 2. Between July 15, 1969, and September 25, 1969, (a) Peoples is a qualified bank holding company Peoples acquired ownership and control of 914 within the meaning of section 1103(b) of the Code, shares of the outstanding capital stock of Peoples & and satisfies the requirements of that section; Enderlin State Bank ("Bank"), representing 91.4 (B) The insurance agency assets that Peoples propercent of such shares. Peoples presently owns and poses to distribute are "prohibited property" within controls 1107.8 shares of the 1,200 outstanding capi- the meaning of section 1103(c) of the Code; tal stock of Bank, representing 92.3 percent of such (C) The distribution of the insurance agency assets shares. is necessary or appropriate to effectuate section 4 of 3. Peoples became a bank holding company on De- the BHC Act. cember 31, 1970, as a result of the 1970 Amendments to the BHC Act, by virtue of its ownership This certification is based upon the representations and control at that time of more than 25 percent of made to the Board by Peoples and upon the facts set the outstanding voting shares of Bank, and regis- forth above. In the event that the Board should hereaftered as such with the Board on May 27, 1971. Peo- ter determine that the facts material to this certificaples would have been a bank holding company on tion are otherwise than as represented by Peoples or July 7, 1970, if the BHC Act Amendments of 1970 that Peoples has failed to disclose to the Board other had been in effect on that date by virtue of its own- material facts, the Board may revoke this certification. ership and control on that date of more than 25 per- By order of the Board of Governors, acting through cent of the outstanding voting shares of Bank. its General Counsel pursuant to delegated authority 4. Peoples has directly engaged in the operation of a (12 C.F.R. § 265.2(b)(3)), effective October 9, 1980. general insurance agency since its formation on August 22, 1962. 5. Peoples has not filed an application with the (Signed) THEODORE E. ALLISON, Board, and has not otherwise obtained the Board's [SEAL] Secretary of the Board. approval, pursuant to section 4(c)(8) of the BHC Act, to continue to engage in the operation of an insurance agency.2 Seilon, Inc., Toledo, Ohio 2. Although Peoples has not sought Board approval to retain its Prior Certification Pursuant to the Bank Holding general insurance agency activities, these activities may be among Company Tax Act of 1976 those activities that the Board has determined to be closely related to banking under section 4(c)(8) of the BHC Act, 12 U.S.C. § 1843(c)(8). Effective December 5, 1979, the Board amended section 225.4(a)(9) of [Docket No. TCR 76-139] its Regulation Y pursuant to section 4(c)(8) of the BHC Act to include as a permissible activity acting as insurance agent or broker with respect to any insurance sold by a bank holding company in a commu- Seilon, Inc., Toledo, Ohio ("Seilon") has requested a nity that has a population not exceeding 5,000, provided that the prin- prior tax certification pursuant to section 1101(a) of the cipal place of banking business of the bank holding company is located Internal Revenue Code ("Code"), as amended by the in a community having a population not exceeding 5,000. 12 C.F.R. § 225.4(a)(9). While Peoples' insurance activities generally fall within Bank Holding Company Tax Act of 1976 ("Tax Act"), this category, under the Board's present procedures, the question that its proposed pro rata distribution to its sharewhether, or to what extent, Peoples would be permitted to retain these holders of its entire interest in its wholly-owned subactivities would not be determinable unless and until Peoples files an application for permission to retain the activities. In passing upon sidiary, Thomson International Company, Thibodaux, such an application, the Board would be required to apply the second Louisiana ("Thomson"), is necessary or appropriate test set forth in section 4(c)(8) and to determine whether the performance of the activities by Peoples could "reasonably be expected to to effectuate section 4 of the Bank Holding Company produce benefits to the public, such as greater convenience, increased Act ("BHC Act") (12 U.S.C. § 1843). competition, or gains in efficiency, that outweigh possible adverse ef- In connection with this request, the following inforfects, such as undue concentration of resources, decreased or unfair competition, conflicts of interest, or unsound banking practices." In mation is deemed relevant for purposes of issuing the the absence of favorable action on such an application, Peoples would requested certification.1 have no authority to continue to be a bank holding company beyond December 31, 1980. The legislative history of the Tax Act does not 1. Seilon is a corporation organized and existing unindicate a Congressional intent that companies subject to such a di- der the laws of the state of Delaware. vestiture requirement exhaust the possibilities for retaining the activity before being eligible for tax relief, and in view of the paramount purpose of section 4 of the BHC Act that "banking and commerce should remain separate," S. Rep. No. 1084, 91st Cong., 2d Sess. 12 1. This information derives from Seilon's communications with the (1970), it would appear that the disposition of a potentially permissible Board concerning its request for this certification, Seilon's activity, without first seeking approval for retention, is at least "ap- Registration Statement filed with the Board pursuant to the BHC Act, propriate" to effectuate section 4. and other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 929 2. Beginning on December 16, 1968, Seilon began This certification is based upon the representations acquiring the stock of Nevada National Bancorpora- and commitments made to the Board by Seilon and tion (formerly First Bancorporation), Reno, Nevada upon the facts set forth above. In the event that the ("Bancorporation"), obtaining 25 percent own- Board should hereafter determine that the facts mateership of its shares by February 13, 1969. rial to this certification are otherwise than as repre- 3. Seilon became a bank holding company on De- sented by Seilon or that Seilon has failed to disclose to cember 31, 1970, as a result of the 1970 Amend- the Board other material facts, the Board may revoke ments to the BHC Act, by virtue of its indirect own- this certification. ership and control at that time through By order of the Board of Governors, acting through Bancorporation of more than 25 percent of the out- its General Counsel pursuant to delegated authority standing voting shares of Nevada National Bank, (12 C.F.R. § 265.2(b)(3)), effective October 7, 1980. Reno, Nevada ("Bank"), and registered as such on July 9, 1971. Seilon would have been a bank holding (Signed) THEODORE E. ALLISON, company on July 7, 1970, had the BHC Act Amend- [SEAL] Secretary of the Board. ments been in effect on that date. At present, Seilon owns 761,125 shares, representing 38.53 percent of Bancorporation's 1,975,588 outstanding voting The Sperry and Hutchinson Company, shares. Bancorporation, in turn, owns 100 percent New York, New York of the shares (less directors' qualifying shares) of Bank. Final Certification Pursuant to the Bank Holding 4. Thomson (a Delaware corporation chartered in Company Tax Act of 1976 1963 as International Cane Machinery Corporation) and its subsidiaries are engaged in the manufacture The Sperry and Hutchinson Company, New York, and sale of specialized machinery and equipment for New York ("S&H"), has requested a final certificathe sugar cane industry and off-highway transport tion pursuant to section 1101(e) of the Internal Reveequipment. Seilon presently owns all of the issued nue Code (the "Code"), as amended by section 2(a) of and outstanding voting shares of Thomson. Seilon the Bank Holding Company Tax Act of 1976 (the "Tax has directly or indirectly owned these shares since Act"), that it has, before the expiration of the period before July 7, 1970. prohibited property is permitted under the Bank Hold- 5. Section 4 of the BHC Act requires that Seilon di- ing Company Act, 12 U.S.C. § 1841 et seq., ("BHC vest its ownership of Thomson if Seilon is to remain Act") to be held by a bank holding company, ceased to a bank holding company beyond December 31, be a bank holding company. 1980. In connection with this request, the following infor- 6. Seilon has committed that on and after the ef- mation is deemed relevant for purposes of issuing the fective date of the divestiture, no person holding an requested certification:1 office or position (including as advisory or honorary 1. Effective February 16, 1979, the Board issued a position) with Seilon or any of its subsidiaries as a prior certification pursuant to section 1101(b) of the director, policy making employee, or consultant, Code with respect to the proposed divestiture by who performs (directly or through an agent, repre- S&H of 1,382,815 shares of State National Bank of sentative, or nominee) functions comparable to Connecticut, Bridgeport, Connecticut ("Bank"), those normally associated with such office or posi- then held by S&H through the pro rata distribution tion, will hold any such office or position or perform to S&H's stockholders of all of the shares of State any such function with Thomson or any of its pres- National Bancorp, Inc. ("Bancorp"), a corporation ent or future affiliates. created and availed of solely for the purpose of receiving S&H's shares of Bank. On the basis of the foregoing, it is hereby certified 2. The Board's Order certified that: that: A. S&H is a qualified bank holding corporation (A) Seilon is a qualified bank holding corporation within the meaning of section 1103(b) of the Code, within the meaning of section 1103(b) of the Code and satisfies the requirements of that subsection; and satisfies the requirements of that section; B. the 1,382,815 shares of Bank that S&H pro- (B) the shares of Thomson which Seilon proposes poses to exchange for shares of Bancorp are all or to distribute to its shareholders constitute "prohibited property" within the meaning of section 1103(c) of the Code; 'This information derives from S&H's communications with the Board concerning its request for this certification, S&H's Registration (C) the distribution of such shares is necessary or Statement filed with the Board pursuant to the BHC Act, and other appropriate to effectuate section 4 of the BHC Act. records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

930 Federal Reserve Bulletin • November 1980 part of the property by reason of which S&H con- (12 C.F.R. § 265.2(b)(3)), effective September 29, trols (within the meaning of section 2(a) of the 1980. BHC Act) a bank or a bank holding company; and (Signed) GRIFFITH L. GARWOOD, C. the exchange of the shares of Bank for the [SEAL] Deputy Secretary of the Board. shares of Bancorp and the distribution to the shareholders of S&H of the shares of Bancorp are necessary or appropriate to effectuate the policies Strachan Construction Company, Inc., of the BHC Act. Fort Walton Beach, Florida 3. On March 8, 1979, S&H exchanged its 1,382,815 shares of Bank for all of the shares of Bancorp, and Prior Tax Certification Pursuant to the Bank Holding immediately thereafter distributed to its share- Company Tax Act of 1976 holders, on a pro rata basis, all of the shares of Bancorp. S&H does not currently hold any interest in Strachan Construction Company, Inc., Fort Walton Bank or Bancorp. Beach, Florida, ("Strachan"), has requested a prior 4. The prior certification issued on February 16, certification pursuant to section 1101(b) of the Internal 1979, was granted upon the condition that after April Revenue Code ("Code"), as amended by section 2(a) 30, 1979, no person holding an office or position (in- of the Bank Holding Company Tax Act of 1976 ("Tax cluding an advisory or honorary position) with S&H Act"), that its proposed divestiture of 11,966 shares of or any of its subsidiaries as an officer, director, pol- First City Bank of Fort Walton Beach, Fort Walton icy-making employee or management consultant, or Beach, Florida ("Bank"), presently held by Strachan who performs (directly or through an agent, repre- through the pro rata distribution of such shares to sentative or nominee) functions comparable to those Strachan's three shareholders, is necessary or appronormally associated with such office or position, will priate to effectuate the policies of the Bank Holding hold any such office or position or perform any such Company Act (12 U.S.C. § 1841 et. seq.) ("BHC function with Bancorp, Bank, or any of their sub- Act"). sidiaries. Accordingly, effective April 30, 1979, all In connection with this request the following inforsuch interlocking relationships between S&H and its mation is deemed relevant:1 subsidiaries on the one hand and Bancorp and Bank 1. Strachan is a corporation organized under the and their respective subsidiaries on the other, were laws of Florida on July 1, 1962. terminated. 2. On December 2, 1969, Strachan acquired own- 5. S&H does not directly or indirectly own, control ership and control of 11,966 shares, representing apor have power to vote 25 percent or more of any proximately 36 percent of Bank's outstanding voting class of voting securities of any bank or any compa- shares. ny that controls a bank. 3. Strachan became a bank holding company on De- 6. S&H has represented that it does not control in cember 31, 1970, as a result of the 1970 Amendany manner the election of a majority of directors, ments to the BHC Act, by virtue of its ownership or exercise a controlling influence over the manage- and control at that time of more than 25 percent of ment or policies of Bank, Bancorp, or any other the outstanding voting shares of Bank, and regisbank or any company that controls a bank. tered with the Board as such on October 25, 1971. On the basis of the foregoing information it is hereby Strachan would have been a bank holding company certified that S&H has (before the expiration of the pe- on July 7, 1970, if the BHC Act Amendments of 1970 riod prohibited property is permitted under the BHC had been in effect on that date by virtue of its own- Act to be held by a bank holding company) ceased to ership and control on that date of more than 25 perbe a bank holding company. cent of the outstanding shares of Bank. Strachan This certification is based upon the representations presently owns and controls 13,751 shares, repremade to the Board by S&H and upon the facts set forth senting approximately 33 percent of Bank's outabove, including S&H's compliance with the condition standing shares.2 imposed by the prior certification. In the event the 1. This information derives from Strachan's communications with Board should determine that facts material to this certhe Board concerning its request for this certification, Strachan's Regtification are otherwise than as represented by S&H, istration Statement filed pursuant to the Bank Holding Company Act, or that S&H has failed to disclose to the Board other and other records. 2. Subsequent to July 7, 1970, Strachan acquired shares of Bank, material facts or failed to observe that condition, the representing 4.1 percent of Bank's outstanding shares. Inasmuch as Board may revoke this certification. section 1101(c) of the Code provides generally that property acquired By order of the Board of Governors, acting through by an otherwise qualified bank holding company after July 7, 1970, are not eligible for special tax treatment under sections 1101(a) and (b) of its General Counsel, pursuant to delegated authority the Code, Strachan is not seeking certification for the 1,785 shares. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 931 4. Strachan holds property acquired by it on or be- 1. Effective December 28, 1979, the Board issued a fore July 7, 1970, the disposition of which would be prior certification pursuant to section 6158(a) of the required by section 4 of the BHC Act, if Strachan Code with respect to the proposed sale of 7,335 were to continue to be a bank holding company shares, representing 84.35 percent of the outbeyond December 31, 1980, which property is "pro- standing voting shares, of The First National Bank hibited property" within the meaning of section of North Vernon, North Vernon, Indiana ("Bank"), 1103(c) of the Code. to Albert R. Jackson, North Vernon, Indiana, for himself as principal and agent for 27 other principals On the basis of the foregoing information, it is here- (together referred to as "Buyers"). The Board's Orby certified that: der certified that: A. Strachan is a qualified bank holding corporation A. Vernon is a qualified bank holding corporation within the meaning of section 1103(b) of the Code, within the meaning of section 1103(b) of the Code and satisfies the requirements of that section; and satisfies the requirements of that section; B. The 11,966 shares of Bank that Strachan pro- B. the Bank shares covered by the instant request poses to distribute to its shareholders are all or part are the property by reason of which Vernon conof the property by reason of which Strachan con- trols (within the meaning of section 2(a) of the trols within the meaning of section 2(a) of the BHC BHC Act) a bank; and Act a bank or bank holding company; and C. the sale of such shares of Bank is necessary or C. The distribution of the shares of Bank is neces- appropriate to effectuate the policies of the BHC sary or appropriate to effectuate the policies of the Act. BHC Act. 2. On January 8, 1980, Vernon sold to Buyers all of The certification is based on representations made its interest in Bank. to the Board by Strachan and upon the facts set forth 3. The prior certification issued on December 28, above. In the event the Board should hereafter deter- 1979, was granted on the condition that no person mine that facts material to this certification are other- holding an office or position (including an advisory wise than as represented by Strachan or that Strachan or honorary position) with Vernon as a director, ofhas failed to disclose other material facts, it may re- ficer, policy-making employee or consultant, or who voke this certification. performs (directly or through an agent, representa- By order of the Board of Governors, acting through tive or nominee) functions comparable to those norits General Counsel, pursuant to delegated authority mally associated with such office or position, will (12 C.F.R. § 263.2(b)(3)), effective October 21, 1980. hold any such office or position or perform any such function with Bank or any of its subsidiaries or affili- (Signed) GRIFFITH L. GARWOOD, ates. Vernon further committed that none of Buyers [SEAL] Deputy Secretary of the Board. is, or will be, indebted to Vernon, and that none of Buyers is affiliated in any way with Vernon. Effective January 8, 1980, all interlocking relationships Vernon Financial Corporation, between Vernon and Bank were terminated and the Indianapolis, Indiana total consideration paid for Bank's shares was remitted in cash to Vernon. Final Certification Pursuant to the Bank Holding 4. Vernon has represented that it does not exercise Company Tax Act of 1976 a controlling influence over the management or policies of Bank, or any other bank or bank holding Vernon Financial Corporation, Indianapolis, Indiana company. ("Vernon"), has requested a final certification pur- 5. Vernon has represented that it does not control in suant to section 6158(c)(2) of the Internal Revenue any manner the election of a majority of the direc- Code ("Code"), as added by section 3(a) of the Bank tors, or own or control, directly or indirectly, more Holding Company Tax Act of 1976, that it has, before than 5 percent of the outstanding shares of any bank the expiration of the period prohibited property is per- or bank holding company. mitted under the Bank Holding Company Act, 12 On the basis of the foregoing information, it is here- U.S.C. § 1841 et seq., ("BHC Act") to be held by a by certified that Vernon has (before the expiration of bank holding company, ceased to be a bank holding the period prohibited property is permitted under the company. In connection with this request, the following infor- 1. This information derives from Vernon's correspondence with the mation is deemed relevant for the purposes of issuing Board concerning its request for this certification, Vernon's registration statement filed with the Board pursuant to the BHC Act, and the requested certification:1 other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

932 Federal Reserve Bulletin • November 1980 BHC Act to be held by a bank holding company) Board. FPC has submitted evidence to the Board to ceased to be a bank holding company. show that it is not in fact capable of controlling FIBI This certification is based upon the representations and the Board has received no contradictory evidence. and commitments made to the Board by Vernon and It is hereby determined that FPC is not in fact capable upon the facts set out above. In the event the Board of controlling FIBI. This determination is based upon should hereafter determine that facts material to this the evidence of record in this matter that reflects the certification are otherwise than as represented by Ver- following: non, or that Vernon has failed to disclose to the Board On January 3, 1979, FPC sold its 37.4 percent interother material facts or to fulfill any of its com- est in voting shares of FIBI (consolidated assets of mitments, the Board may revoke this certification. $1.1 billion as of December 31, 1979), an Israeli bank By order of the Board of Governors, acting through holding company, to Mr. John Marsh and his whollyits General Counsel pursuant to delegated authority owned corporation, DEVCO INVESTMENTS, INC. (12 C.F.R. § 265.2(b)(3)), effective October 10, 1980. ("Devco"). The sale of FIBI's voting shares by FPC appears to have resulted from arm's length negotia- (Signed) GRIFFITH L. GARWOOD, tions, and there is no evidence of record indicating that [SEAL] Deputy Secretary of the Board. FPC is associated with Mr. Marsh or Devco in any way or that the subject sale was motivated by an intent to evade the requirements of the Act. Furthermore, Orders Under Section 2 of Bank Holding FPC informed the Board that Mr. Marsh and Devco Company Act sold their interest in FIBI to a third party which is not in any way affiliated with FPC. However, FPC contin- First Pennsylvania Corporation ues to own $8.2 million of FIBI Subordinated Capital Philadelphia, Pennsylvania Notes ("Notes"), which were issued in 1978 prior to the sale of FIBI by FPC. The Notes are non-convert- Order Granting Determination Under the Bank ible, non-voting, insured by the Israeli government Holding Company Act against devaluation relative to the U.S. dollar, and represent approximately 8 percent of FIBI's total out- First Pennsylvania Corporation ("FPC"), Phila- standing subordinated capital Notes. It appears that delphia, Pennsylvania, a bank holding company within FIBI is in satisfactory financial condition and has kept the meaning of section 2(a) of the Bank Holding Com- all interest payments on the Notes current. These and pany Act of 1956, as amended (The "Act") (12 U.S.C. other facts of record are sufficient to support the con- § 1841 (a)), has requested a determination pursuant to clusion that FPC is not in fact capable of controlling section 2(g)(3) of the Act, that with respect to the sale FIBI by reason of this indebtedness. In addition, there of its 37.4 percent interest in voting shares of F.I.B.I. are no officer or director interlocks between FPC or Holding Company Limited ("FIBI"), Tel Aviv, Israel, any of its subsidiaries, on the one hand, and FIBI on FPC is not in fact capable of controlling FIBI notwith- the other. Furthermore, FPC has submitted a corpostanding the fact that FPC continues to own portions rate resolution stating its intent to establish and mainof three issues of FIBI Subordinated Capital Notes. tain complete separation of the management and oper- Under the provisions of section 2(g)(3) of the Act, ation of FIBI, and resolving that FPC will not shares transferred after January 1, 1966, by a bank exercise, or attempt to exercise, any influence or conholding company to a transferee that is indebted to the trol over FIBI or its management. transferor or has one or more officers, directors, Accordingly, it is ordered that the request of FPC trustees, or beneficiaries in common with or subject to for a determination pursuant to section 2(g)(3) is grantcontrol by the transferor, are deemed to be indirectly ed. This determination is based upon the representaowned or controlled by the transferor unless the tions made to the Board by FPC. In the event the Board, after opportunity for hearing, determines that Board should hereafter determine that facts material to the transferor is not in fact capable of controlling the this determination are otherwise than as represented, transferee.1 or that FPC has failed to disclose to the Board other The time provided for requesting a hearing has ex- material facts, this determination may be revoked, and pired. No such request has been received by the any change in the circumstances relied upon in making 1. In its 1978 interpretation of section 2(g)(3), the Board noted that Board noted that the retention of an economic interest in the divested it will require termination of any interlocking management relation- company that would create an incentive for the divesting company to ship between the divesting company and the divested company as a attempt to influence the management of the divested company will precondition of finding that a divestiture is complete. Similarly, the preclude a finding that the divestiture is complete. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 933 this determination could result in the Board's recon- facts of record, it is concluded that control of Compasideration of this determination. ny resides with its individual shareholders and that By order of the Board of Governors, acting through company does not control and is not in fact capable of its General Counsel, pursuant to delegated authority controlling its shareholders in their capacity as trans- (12 C.F.R. § 265.2(b)(1)), effective October 29, 1980. ferees of Company's stock or otherwise. At the meeting of Company's board on May 21, 1980, the directors (Signed) GRIFFITH L. GARWOOD, resolved to waive Company's entitlement to a per- [SEAL] Deputy Secretary of the Board. manent exemption from the prohibitions of section 4 of the Bank Holding Company Act under section 4(c)(ii) of that Act. The waiver was made pursuant to section Lee Wilson & Co., 1103(h) of the Code. Wilson, Arkansas Accordingly, it is ordered that the request of Company for a determination pursuant to section 2(g)(3) be Order Granting Determination Under the Bank and hereby is granted. This determination is based up- Holding Company Act on the representation made to the Board by Company and the Wilson family. In the event the Board should Lee Wilson & Co. ("Company"), Wilson, Arkansas, a hereafter determine that facts material to this determibank holding company within the meaning of section nation are otherwise than as represented, or that Com- 2(a) of the Bank Holding Company Act of 1956, as pany or the Wilsons have failed to disclose to the amended (12 U.S.C. § 1841(a)), by virtue of its indirect Board other material facts, this determination may be control of Bank of Wilson ("Bank"), Wilson, Ar- revoked, and any change in the facts or circumstances kansas, has requested a determination, pursuant to the relied upon by the Board in making this determination provisions of section 2(g)(3) of the Bank Holding Com- could result in the Board reconsidering the determinapany Act of 1956 (12 U.S.C. § 1841(g)(3)) (the "Act"), tion made herein. that Company is not in fact capable of controlling By order of the Board of Governors, acting through shareholders of Lee Wilson & Co. ("shareholders"), its General Counsel, pursuant to delegated authority all members of the Wilson family to whom it trans- (12 C.F.R. § 265.2(1)), effective October 6, 1980. ferred its interest in Bank, notwithstanding the fact that some of these individuals are officers and direc- (Signed) GRIFFITH L. GARWOOD, tors of Company and Bank. [SEAL] Deputy Secretary of the Board. Under the provisions of section 2(g)(3) of the Act, shares transferred after January 1, 1966, by any bank holding company to a transferee that is indebted to the The Sperry and Hutchinson Company, transferor or has one or more directors, trustees, or New York, New York beneficiaries in common with or subject to control by the transferor, are deemed to be indirectly owned or Order Granting Determination Under the Bank controlled by the transferor unless the Board, after op- Holding Company Act portunity for hearing, determines that the transferor is not in fact capable of controlling the transferee. The Sperry and Hutchinson Company, New York, It is hereby determined that Company is not, in fact, New York ("S&H"), a bank holding company within capable of controlling any of the shareholders. This the meaning of section 2(a) of the Bank Holding Comdetermination is based on the evidence of record in pany Act of 1956, as amended (12 U.S.C. § 1841 (a)), this matter, including the following facts. Company is by virtue of its indirect control of State National Bank a small closely held corporation of which the Wilson of Connecticut, Bridgeport, Connecticut ("Bank"), family are the sole shareholders. Company divested its has requested a determination, pursuant to the proviinterest in Bank by distributing the Bank shares held sions of section 2(g)(3) of the Act (12 U.S.C by it on a pro rata basis to Company's shareholders. § 1841(g)(3)) that S&H is not in fact capable of con- Thus, Company currently holds no interest in Bank. trolling the individuals to whom it indirectly trans- Wilson family shareholders of Company own, control ferred its interest in Bank ("Transferees"), State Naor have the power to vote 24,400 shares (100 percent) tional Bancorp Inc. ("Bancorp"), a corporation of Company and 3,582 shares (89.5 percent) of Bank. created to receive S&H's interest in Bank, or Bank, Inasmuch as the Wilsons are the sole shareholders of notwithstanding the fact that Transferees are officers Company, the divestiture of Bank does not appear to and directors of S&H. have been a means for perpetuating Company's con- Under the provisions of section 2(g)(3) of the Act, trol over Bank. On the basis of the above and other shares transferred after January 1, 1966, by any bank Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

934 Federal Reserve Bulletin • November 1980 holding company to a transferee that is indebted to the Warner Communications Incorporated, transferor or has one or more officers, directors, New York, New York trustees, or beneficiaries in common with or subject to control by the transferor, are deemed to be indirectly Warner Communications Inc., New York, New York owned or controlled by the transferor unless the ("WCI"), formerly a bank holding company within the Board, after opportunity for hearing, determines that meaning of § 2(a) of the Bank Holding Company Act the transferor is not in fact capable of controlling the of 1956, as amended (12 U.S.C. § 1841 et seq.) (the transferee. "Act"), has requested a determination, pursuant to It is hereby determined that S&H is not, in fact, ca- the provisions of section 2(g)(3) of the Act (12 U.S.C. pable of controlling Transferees, Bancorp, or Bank. § 1841(g)(3)), that with respect to the sale by WCI of This determination is based on the evidence of record all of its interest in the outstanding voting shares of in this matter, including the following facts. S&H di- Garden State National Bank, Paramus, New Jersey vested its interest in Bank by forming a new one-bank ("Bank"), to Fidelity Union Bancorporation, Newholding company, Bancorp, and transferring the ark, New Jersey, WCI is not in fact capable of conshares of Bank to it. S&H then distributed the shares trolling Fidelity notwithstanding the fact that Fidelity of Bancorp on a pro rata basis to its shareholders, is indebted to WCI in connection with its purchase of some of whom are Transferees. Thus, S&H now holds Bank. no interest in Bank or Bancorp. All officer/director in- Under the provisions of section 2(g)(3) of the Act, terlocks between S&H and Bancorp/Bank have been shares transferred after January 1, 1966, by any bank terminated, and there is no indebtedness or significant holding company to a transferee that is indebted to the business relationship between S&H and Bancorp/ transferor are deemed to be indirectly owned or con- Bank. The fact that, after a spinoff, the officers and trolled by the transferor unless the Board, after oppordirectors of a bank holding company own shares of the tunity for hearing, determines that the transferor is not divested company is the predictable result of a pro rata in fact capable of controlling the transferee. No such distribution, and that distribution does not appear to request for a hearing has been received by the Board. have been a means for perpetuating S&H's control WCI has submitted to the Board evidence to show that over Bank. Moreover, S&H's board of directors has it is not in fact capable of controlling Fidelity or Bank, adopted a resolution that it cannot control and will not and the Board has received no contradictory evidence. attempt to control Bancorp or Bank. Similarly, the It is hereby determined that WCI is not in fact capable boards of directors of Bancorp and Bank have adopted of controlling either Fidelity or Bank. This determinaresolutions that S&H is incapable of controlling either tion is based upon the evidence of record in this matof those organizations and that they will resist any at- ter, including the following facts. tempt by S&H to do so. On the basis of the above and On July 7, 1980, WCI transferred to Fidelity shares other facts of record, the Board concludes that S&H of Class A and B common Stock of Bank, representing does not control and is not in fact capable of con- an aggregate of 66.23 percent of the outstanding shares trolling Transferees, Bank or Bancorp. of Bank, WCI received as its consideration approxi- Accordingly, it is ordered, that the request of S&H mately $32.5 million in cash and $21.7 million in princifor a determination pursuant to section 2(g)(3) be and pal amount of Seven Year Notes of Fidelity hereby is granted. This determination is based upon ("Notes"). The Notes are a portion of such Notes isthe representations made to the Board by S&H. In the sued by Fidelity to all of Bank's shareholders in conevent the Board should hereafter determine the facts nection with the purchase of Bank. The Notes, which material to this determination are otherwise than as bear interest at the prime rate, are payable in twentyrepresented, or that S&H has failed to disclose to the eight equal quarterly installments beginning on Sep- Board other material facts, this determination may be tember 30, 1980. They may be prepay ed in whole or in revoked, and any change in the facts or circumstances part at Fidelity's option. The Notes are not secured by relied upon by the Board in making this determination the shares of Bank or other assets of Fidelity, and by could result in the Board reconsidering the determina- their terms become immediately due and payable only tion made herein. upon specified commercially reasonable events of By order of the Board of Governors, acting through default. its General Counsel, pursuant to delegated authority In connection with its approval under the Bank (12 C.F.R. § 265.2(b)(1)), effective September 29, Holding Company Act of Fidelity's application to ac- 1980. quire Bank, in its Statement dated June 26, 1980, the Board found that "while Applicant will incur a sub- (Signed) GRIFFITH L. GARWOOD, stantial amount of indebtedness in connection with the [SEAL] Deputy Secretary of the Board. proposed transaction, it appears that Applicant pos- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 935 sesses sufficient financial flexibility to service the debt nation under section 2(g)(3) of the Act (12 U.S.C. and remain a source of strength to its subsidiary § 1841(g)(3)), that Arendts, Inc., is not in fact capable banks."1 Based on the record, there is no evidence of controlling Mr. M. L. Arendt in connection with a that Fidelity will be unable to pay the Notes in accord- sale by Arendts, Inc., of Arendt and Arendt Insurance ance with their terms. Moreover, inasmuch as the Agency, Montezuma, Iowa ("Agency"), to Mr. Notes are term notes having a reasonable fixed sched- Arendt, a director, officer, and principal shareholder ule of payments, and not secured by property of the of Agency. transferee, they are generally regarded as providing Under section 2(g)(3) of the Act, shares transferred little opportunity for WCI to exert any undue influence after January 1, 1966, by any bank holding company to over Fidelity or Bank. In addition, WCI and Fidelity a transferee that has one or more officers or directors have provided formal assurances that no such influ- in common with or subject to the transferor are ence will be exerted, and WCI has committed to the deemed to be indirectly owned or controlled by the Board that it will have no directors and officers in com- transferor unless the Board, after opportunity for hearmon with Fidelity or Bank.2 ing, determines that the transferor is not in fact ca- Accordingly, it is ordered, that the request of WCI pable of controlling the transferee. No request for a for a determination pursuant to section 2(g)(3) is grant- hearing was made by Arendts, Inc. Arendts, Inc. has ed. This determination is based on representations and submitted to the Board evidence to support its concommitments made to the Board by WCI, Fidelity and tention that it is not in fact capable of controlling Mr. Bank. In the event that the Board should hereafter de- Arendt, and the Board has received no contradictory termine that facts material to this determination are evidence. Based upon the evidence of record in this otherwise than as represented, or that WCI, Fidelity matter, it is hereby determined that Arendts, Inc., is or Bank have failed to disclose to the Board other ma- not in fact capable of controlling Mr. Arendt. terial facts, or to fulfill any commitments, this determi- This determination is based upon the evidence of nation may be revoked, and any change in the factors record in this matter, including the following facts: and circumstances relied upon by the Board in making Arendts, Inc. acquired ownership of Agency at the this determination would result in the Board reconsid- time it became a bank holding company by acquiring ering the determination made herein. Peoples Savings Bank, Montezuma, Iowa ("Bank"). By order of the Board of Governors, acting through Agency was acquired from Mr. Arendt for nominal its General Counsel, pursuant to delegated authority consideration, and divestiture of Agency by sale by (12 C.F.R. § 265.2(b)(1)), effective October 1, 1980. Arendts, Inc., to Mr. Arendt was for the same consideration. It does not appear that the sale of Agency to (Signed) GRIFFITH L. GARWOOD, Mr. Arendt was intended for the purpose of circum- [SEAL] Deputy Secretary of the Board. venting the Bank Holding Company Act. Moreover, inasmuch as Mr. Arendt is a director, officer, and principal shareholder of Agency, the divestiture of Agency Arendts, Inc., does not appear to have been a means for perpetuating Montezuma, Iowa control of Arendts, Inc., over Agency. On the basis of the above and other facts of record, it is concluded Order Granting Determination Under the Bank that control of Arendts, Inc. resides with Mr. Arendt Holding Company Act and that Arendts, Inc. does not control and is not in fact capable of controlling Mr. Arendt as transferee of Arendts, Inc., Montezuma, Iowa, a bank holding com- Agency's stock. pany within the meaning of the Bank Holding Compa- Accordingly, it is ordered, that the request of ny Act of 1956, as amended, has requested a determi- Arendts, Inc., for a determination pursuant to section 2(g)(3) be granted. This determination is based on representations made to the Board by Arendts, Inc., Bank 1. In connection with the exercise of WCI stock options by Bank and Mr. Arendt. In the event that the Board should employees, Fidelity has a contingent obligation to WCI to pay to it the amount of any tax deduction or other tax benefit that it receives with hereafter determine that facts material to this determirespect to the exercise of the options. This obligation is not regarded nation are otherwise than as represented, or that as indebtedness within the provisions of section 2(g)(3), since it takes effect only if and when tax benefits accrue to Fidelity, and Fidelity is Arendts, Inc., Bank of Mr. Arendt have failed to dismerely obliged to pass on to WCI the dollar amount of these benefits. close to the Board other material facts, this determina- Even if it is regarded as indebtedness, it will be for a relatively small tion may be revoked, and any change in the facts and amount, and there is no question of Fidelity's ability to pay it. 2. While WCI had three directors in common with Bank, two of circumstances relied upon by the Board in making this whom were executive officers of WCI and one of whom was the chief determination could result in the Board reconsidering executive officer of Bank, each of these individuals terminated their the determination made herein. common positions on or before consummation of the sale. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

936 Federal Reserve Bulletin • November 1980 By order of the Board of Governors, acting through its General Counsel, pursuant to delegated authority (12 C.F.R. § 265.2(b)(1)), effective September 30, 1980. (Signed) GRIFFITH L. GARWOOD, [SEAL] Deputy Secretary of the Board. ORDERS APPROVED UNDER BANK HOLDING COMPANY ACT By the Board of Governors During October the Board of Governors approved the applications listed below. Copies are available upon request to Publications Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Section 3 Board action Applicant Bank(s) (effective date) Northwest Bancshares, Inc., Northwest National Bank Sept. 30,1980 Vancouver, Washington Vancouver, Washington Southwest Bancshares, Inc., San Felipe Green, National Association Sept. 30, 1980 Houston, Texas Houston, 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 Allied Bancshares, Inc. First Bank of Edna, Dallas October 10, 1980 Houston, Texas Edna, Texas Allied Bancshares, Inc., Security National Bank, Dallas October 10, 1980 Houston, Texas Houston, Texas American State, Bancshares, Inc. American State Bank, Dallas October 29, 1980 Broken Bow, Oklahoma Broken Bow, Oklahoma Am Tu, Inc., American Trust & Savings Bank of Chicago October 21, 1980 Whiting, Indiana Whiting, Indiana, Whiting, Indiana Atkinson County Bankshares The Peoples Bank, Atlanta September 29, 1980 Corporation, Willacoochee, Georgia Willacoochee, Georgia B.O.Y. Bancorp, Inc., The Bank of Yorkville, Chicago October 20, 1980 Yorkville, Illinois Yorkville, Illinois Badger Bancshares, Inc., Badger State Bank, Minneapolis October 24,1980 Badger, Minnesota Badger, Minnesota BTNY, BT National Bank, New York October 8, 1980 New York, New York Albany, New York Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 937 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date BTBancshares, Inc., Bankers Trust Company of Albany, Albany, New York N.A., Albany, New York Bradley Bancorp, Columbus Bank and Trust Company, Kansas City September 12, 1980 Columbus, Nebraska Columbus, Nebraska Catoosa Bancshares, Inc., Fort Oglethorpe State Bank, Atlanta October 3,1980 Fort Oglethorpe, Georgia Fort Oglethorpe, Georgia Centennial Bancorporation, First National Bank at Thermopolis, Kansas City September 26, 1980 Thermopolis, Wyoming Thermopolis, Wyoming Cen-Tex Bancshares, Inc., The First National Bank of Dallas October 3,1980 Georgetown, Texas Georgetown, Georgetown, Texas Chanhassen Financial Services, State Bank of Chanhassen, Minneapolis October 14, 1980 Inc., Chanhassen, Minnesota Chanhassen, Minnesota Chickasha Bancshares, Inc., Chickasha Bank & Trust Company, Kansas City September 19, 1980 Chickasha, Oklahoma Chickasha, Oklahoma Citizens Bancorp, Citizens State Bank, Kansas City September 26,1980 Maud, Oklahoma Maud, Oklahoma Commerce Southwest Inc., Texoma National Bank of Sherman Dallas October 28, 1980 Dallas, Texas Sherman, Texas Coweta Bancshares, Inc., The Security National Bank, Kansas City October 17,1980 Coweta, Oklahoma Coweta, Oklahoma Crawfordsville Insurance Agency, Peoples Savings Bank, Chicago October 23,1980 Inc., Crawfordsville, Iowa Crawfordsville, Iowa Cumming Bancshares, Inc., Bank of Cumming, Atlanta October 1, 1980 Cumming, Georgia Cumming, Georgia Douglas Bancorporation, Inc., Bank of the West, Kansas City October 3, 1980 Parker, Colorado Parker, Colorado DuBank Holding Inc., DuQuoin State Bank, St. Louis September 29, 1980 Carbondale, Illinois DuQuoin, Illinois First Belmond BanCorporation, First State Bank, Chicago October 7,1980 Belmond, Iowa Belmond, Iowa Erie Bancorp., Inc., Erie State Bank, Chicago October 15, 1980 Erie, Illinois Erie, Illinois Exchange State Bancorporation, Exchange State Bank of Hills, Minneapolis September 26,1980 Inc., Hills, Minnesota Hills, Minnesota Farmers Exchange Farmers Exchange Bank, Kansas City October 17,1980 Bancorporation, Inc., Cherokee, Oklahoma Cherokee, Oklahoma Fountain Bancorporation, Ltd. Pioneer Bank of Fountain, Kansas City October 17,1980 Colorado Springs, Colorado Fountain, Colorado First Alabama Bancshares, Inc., Chilton County Bank, Atlanta September 25,1980 Montgomery, Alabama Thorsby, Alabama First Bank Corporation, First Community Bank, N.A., Chicago October 9,1980 Midland, Michigan West Branch, Michigan First City Bancorp, Inc., The First National Bank of Cobb Atlanta October 10,1980 Marietta, Georgia County, Marietta, Georgia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

938 Federal Reserve Bulletin • November 1980 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date First Colonial Bankshares Northwest Commerce Bank, Chicago September 30, 1980 Corporation, Rosemont, Illinois Chicago, Illinois First Englewood Bank Corp., Englewood Bank and Trust Atlanta September 30, 1980 Englewood, Florida Englewood, Florida First Grand Prairie Bank Shares, National Bank of Grand Prairie, Dallas October 6, 1980 Inc., Grand Prairie, Texas Grand Prairie, Texas First Keyes Bancshares, Inc., The First State Bank, Kansas City October 10,1980 Keyes, Oklahoma Keyes, Oklahoma First Paullina Bancorp, First National Bank of Paullina, Chicago September 30, 1980 Paullina, Iowa Paullina, Iowa First Schulenburg Financial The First National Bank of Dallas October 8, 1980 Corporation, Schulenburg, Schulenburg, Texas Schulenburg, Texas The First Southeast Missouri Scott City Bank and Trust Company, St. Louis October 28, 1980 Bancorporation, Inc., Scott City, Missouri Scott City, Missouri First State Holding Company, Inc., First State Bank of Joplin, Kansas City September 23, 1980 Joplin, Missouri Joplin, Missouri First State Bancshares, Inc., First State Bank and Trust Company Atlanta October 3, 1980 Valdosta, Georgia of Valdosta, Valdosta, Georgia Guarantee Bancorp. Inc., Guarantee Bank, Philadelphia October 8,1980 Atlantic City, New Jersey Atlantic City, New Jersey Gwinnett Holding Company, Gwinnett County Bank, Atlanta October 10,1980 Snellville, Georgia Snellville, Georgia HAMBAC, Inc., The Lincoln National Bank, St. Louis October 6, 1980 Hodgenville, Kentucky Hodgenville, Kentucky Hamilton Bancgroup & Co., Farmers State Bank of Dahlgren, St. Louis September 23, 1980 St. Louis, Missouri Dahlgren, Illinois Houston American Financial American Bank, Dallas October 3, 1980 Corporation, Houston, Texas Houston, Texas Hunter Holding Company, Security State Bank of Hunter, Minneapolis October 2,1980 North Dakota Hunter, North Dakota Kiowa Bancorporation, Inc., The Bank of Kiowa, Kansas City September 18, 1980 Kiowa, Kansas Kiowa, Kansas Marsh Investments, N.V., et al. Deerfield Beach State Bank, Atlanta October 8, 1980 Curacao, Netherlands Antilles Deerfield Beach, Florida National Bancshares, Inc., The First National Bank of Kansas City September 18, 1980 Bethany, Missouri Bethany, Bethany, Missouri Northwestern Bank Corporation, Northwestern State Bank, Chicago October 7, 1980 East Jordan, Michigan East Jordan, Michigan Northwood Financial Services Northwood State Bank, Chicago September 30, 1980 Corporation, Northwood, Iowa Northwood, Iowa Oakwood Bancorp, Inc., State Bank of Oakwood, Chicago October 22, 1980 Springfield, Illinois Oakwood, Illinois Oilton Bancshares, Inc., First State Bank, Kansas City September 12, 1980 Oil ton, Oklahoma Oilton, Oklahoma Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 939 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date Orange Bancshares, Inc., Orange Bank, Dallas October 2, 1980 Orange, Texas Orange, Texas Philip Bancorporation, Inc., First National Bank in Philip, Minneapolis September 24, 1980 Philip, South Dakota Philip, South Dakota Pikeville National Corporation, The Pikeville National Bank Cleveland October 23, 1980 Pikeville, Kentucky and Trust Company, Pikeville, Kentucky Portland Financial Services, Inc., The Citizens Bank of Portland, Chicago October 10, 1980 Portland, Indiana Portland, Indiana Riverton State Bank Holding Riverton State Bank, Kansas City September 18, 1980 Company, Riverton, Wyoming Riverton, Wyoming Royal Bancshares, Inc., Citizens Bank of University St. Louis September 30, 1980 University City, Missouri City, University City, Missouri SBC, Incorporated, State Bank of Countryside, Chicago October 21, 1980 Countryside, Illinois Countryside, Illinois San Benito Bancshares, Inc., The San Benito Bank & Trust Dallas October 17,1980 San Benito, Texas Company, San Benito, Texas Security State Bank Holding Farmers and Merchants Bank of Minneapolis October 8,1980 Company, Wimbledon, Hannaford, North Dakota Wimbledon, North Dakota Security Bancorp, Inc., Hampton National Bank, Boston October 3,1980 Hampton, New Hampshire Hampton, New Hampshire Security Financial Services, Inc., Bank of Menasha, Chicago September 30, 1980 Sheboygan, Wisconsin Menasha, Wisconsin Shelby County Bancshares, Inc., The Shelby County State Bank, Chicago October 24, 1980 Harlan, Iowa Harlan, Iowa Silverton Bancshares, Inc., First State Bank, Dallas September 26, 1980 Silverton, Texas Silverton, Texas Southeast Bancshares, Inc., Commercial National Bank, Dallas October 20,1980 Dallas, Texas Dallas, Texas Southwestern Bancorp, Inc., Sanderson State Bank, Dallas October 17, 1980 Sanderson, Texas Sanderson, Texas Springville Banshares Corp., The Exchange State Bank, Chicago October 17, 1980 Anamosa, Iowa Springville, Iowa Tennessee Homestead Company, Bank of Utah, San Francisco October 27, 1980 Ogden, Utah Ogden, Utah United Missouri Bancshares, Inc., Warsaw Bancshares, Kansas City September 24,1980 Kansas City, Missouri Warsaw, Missouri Whitefish Holding Company, Inc., The First State Bank of Whitefish, Minneapolis October 10,1980 Whitefish, Montana Whitefish, Montana Wyandotte Bank Corporation, The Wyandotte Bank, Kansas City September 24,1980 Kansas City, Kansas Kansas City, Kansas Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

940 Federal Reserve Bulletin • November 1980 Section 4 Nonbanking Applicant company Reserve Effective (or activity) Bank date Barnes Investment Corporation, Barnes Insurance Agency, Kansas City October 3,1980 Barnes, Kansas Barnes, Kansas Beutler, Inc., to continue to engage in general Kansas City September 15, 1980 Ness City, Kansas insurance agency activities The Bridger Company, to continue to engage in operating Minneapolis October 6,1980 Wayzata, Montana a general insurance agency in Bridger, Montana CLC Enterprises, Inc., to continue to engage in general Kansas City September 12, 1980 Nelson Nebraska insurance agency activities Continental Illinois Corporation, to continue to sell property and Chicago September 26, 1980 Chicago, Illinois casualty insurance Dewco Agency, Co., to continue to engage in operating Minneapolis September 24, 1980 Timber Lake, South Dakota a general insurance agency Dream, INC., to continue to engage in the Chicago September 25, 1980 Melbourne, Iowa sale of general insurance First Bank System, Inc., Tower Mortgage Corporation, Minneapolis September 24, 1980 Minneapolis, Minnesota Minneapolis, Minnesota First Pennsylvania Corporation to retain Pennamco Insurance Philadelphia October 9, 1980 Philadelphia, Pennsylvania Service, Inc., Philadelphia, Pa. Lanesboro Agency, Inc., to continue to engage in operating Minneapolis October 9, 1980 Lanesboro, Minnesota a general insurance agency Mellon National Corporation, Mellon Life Insurance Company Cleveland October 8, 1980 Pittsburgh, Pennsylvania Wilmington, Delaware Munter Agency, Inc., to continue to engage in general Chicago September 26, 1980 Strawberry Point, Iowa insurance activities through Union Insurance Agency in Strawberry Point, Iowa P and D Company of Stewartville to continue to sell certain types Minneapolis October 2, 1980 Inc., of insurance in a community with a Stewartville, Minnesota population not exceeding 5,000 Rainier Bancorporation Roger R. Post & Company, Inc., San Francisco September 30, 1980 Seattle, Washington Monterey, California Security Bancorp, Inc., SecureData Corp., Chicago October 24, 1980 Southgate, Michigan Troy, Michigan Valley State Investments, Inc., to continue to engage in the sale Kansas City October 10,1980 Lamar, Colorado of insurance ORDERS APPROVED UNDER BANK MERGER ACT By the Board of Governors Effective Applicant Bank(s) The Central Trust Company, The Millersport Bank Co., October 17, 1980 Reynoldsburg, Ohio Millersport, Ohio Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 941 By Federal Reserve Banks Reserve Effective Applicant Bank(s) Bank date Security Savings Bank, State Bank, Chicago September 30, 1980 Marshalltown, Iowa Gladbrook, Iowa AmeriTrust Company, AmeriTrust Company of Portage Cleveland October 3, 1980 Cleveland, Ohio County, Kent, Ohio AmeriTrust Company of Cincinnati, Cincinnati, Ohio AmeriTrust Company of Medina County, Medina, Ohio PENDING CASES INVOLVING THE BOARD OF GOVERNORS* *This list of pending cases does not include suits A. G. Becker Inc., v. Board of Governors, et al., filed against the Federal Reserve Banks in which the Board August 1980, U.S.D.C. for the District of Columbia. of Governors is not named a party. Otero Savings and Loan Association v. Board of Governors, filed August 1980, U.S.D.C. for the District Securities Industry Association v. Board of Gover- of Columbia. nors, et al., filed October 1980, U.S.D.C. for the Edwin F. Gordon v. Board of Governors, et al., filed District of Columbia. August 1980, U.S.C.A. for the Fifth Circuit. Securities Industry Association v. Board of Gover- Edwin F. Gordon v. Board of Governors, et al., filed nors, et al., filed October 1980, U.S.C.A. for the July 1980, U.S.D.C. for the Northern District of District of Columbia. Georgia. A. G. Becker, Inc. v. Board of Governors et al., filed Edwin F. Gordon v. Board of Governors, et al., filed October 1980, U.S.D.C. for the District of Colum- July 1980, U.S.D.C. for the Northern District of bia. Georgia. A. G. Becker, Inc. v. Board of Governors, et al., filed Edwin F. Gordon v. Board of Governors, et al., filed October 1980, U.S.C.A. for the District of Colum- August 1980, U.S.D.C. for the Northern District of bia. Georgia. Independent Insurance Agents of America and Inde- Martin-Trigona v. Board of Governors, filed July 1980, pendent Insurance Agents of Missouri v. Board of U.S.C.A. for the District of Columbia. Governors, filed September 1980, U.S.C.A. for the U.S. League of Savings Associations v. Depository Eighth Circuit. Institutions Deregulation Committee, et al., filed Independent Insurance Agents of America and Inde- June 1980, U.S.D.C. for the District of Columbia. pendent Insurance Agents of Virginia v. Board of Berkovitz, et al. v. Government of Iran, et a., filed Governors, filed September 1980, U.S.C.A. for the June 1980, U.S.D.C. for the Northern District of Fourth Circuit. California. Nebraska Bankers Association, et al. v. Board of Gov- Edwin F. Gordon v. Board of Governors, et al., filed ernors, et al., filed September 1980, U.S.D.C. for June 1980, U.S. Supreme Court. the District of Nebraska. Mercantile Texas Corporation v. Board of Governors, Republic of Texas Corporation v. Board of Governors, filed May 1980, U.S.C.A. for the Fifth Circuit. filed September 1980, U.S.C.A. for the Fifth Cir- Corbin, Trustee v. United States, filed May 1980, cuit. United States Court of Claims. Welch Bancshares v. Board of Governors, filed Sep- Louis J. Roussel v. Board of Governors, filed April tember 1980, U.S.C.A. for the Tenth Circuit. 1980, U.S.D.C. for the District of Columbia. Consumers Union of the United States, Inc., v. Board Ulyssess S. Crockett v. United States et al., filed April of Governors etal., filed August 1980, U.S.D.C. for 1980, U.S.D.C. for the Eastern District of North the District of Columbia. Carolina. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

942 Federal Reserve Bulletin • November 1980 County National Bancorporation and TGB Co. v. Credit and Commerce American Investment, et al., v. Board of Governors, filed September 1979, Board of Governors, filed March 1979, U.S.C.A. for U.S.C.A. for the Eighth Circuit. the District of Columbia. Gregory v. Board of Governors, filed July 1979, Independent Bankers Association of Texas v. First U.S.D.C. for the District of Columbia. National Bank in Dallas, et al., filed July 1978, Donald W. Riegel, Jr. v. Federal Open Market Com- U.S.D.C. for the Northern District of Texas. mittee, filed July 1979, U.S.D.C. for the District of Security Bancorp and Security National Bank v. Columbia. Board of Governors, filed March 1978, U.S.C.A. for Connecticut Bankers Association, et al., v. Board of the Ninth Circuit. Governors, filed May 1979, U.S.C.A. for the Dis- Vickars-Henry Corp. v. Board of Governors, filed Detrict of Columbia. cember 1977, U.S.C.A. for the Ninth Circuit. Independent Insurance Agents of America, et al., v. Investment Company Institute v. Board of Governors, Board of Governors, filed May 1979, U.S.C.A. for filed September 1977, U.S.D.C. for the District of the District of Columbia. Columbia. Independent Insurance Agents of America, et al., v. Roberts Farms, Inc. v. Comptroller of the Currency, Board of Governors, filed April 1979, U.S.C.A. for et al., filed November 1975, U.S.D.C. for the Souththe District of Columbia. ern District of California. Independent Insurance Agents of America, et al., v. David Merrill, et al. v. Federal Open Market Com- Board of Governors, filed March 1979, U.S.C.A. for mittee, filed May 1975, U.S.D.C. for the District of the District of Columbia. Columbia. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A1 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 A18 All reporting banks A5 Reserves and borrowings of member banks A19 Banks with assets of $ 1 billion or more A6 Federal funds and repurchase agreements of A20 Banks in New York City large member banks A21 Balance sheet memoranda All Commercial and industrial loans POLICY INSTRUMENTS A23 Gross demand deposits of individuals, partnerships, and corporations A7 Federal Reserve Bank interest rates A8 Depository institutions reserve requirements A9 Maximum interest rates payable on time and FINANCIAL MARKETS savings deposits at federally insured institutions A10 Federal Reserve open market transactions A23 Commercial paper and bankers dollar acceptances outstanding A24 Prime rate charged by banks on short-term FEDERAL RESERVE BANKS business loans A24 Terms of lending at commercial banks All Condition and Federal Reserve note statements A25 Interest rates in money and capital markets A12 Maturity distribution of loan and security A26 Stock market—Selected statistics holdings All Savings institutions—Selected assets and liabilities MONETARY AND CREDIT AGGREGATES All Bank debits and deposit turnover FEDERAL FINANCE A13 Money stock measures and components A14 Aggregate reserves and deposits of member A28 Federal fiscal and financing operations banks A29 U.S. budget receipts and outlays A15 Loans and securities of all commercial banks A30 Federal debt subject to statutory limitation A30 Gross public debt of U.S. Treasury—Types and ownership COMMERCIAL BANKS A31 U.S. government marketable securities- Ownership, by maturity A16 Major nondeposit funds A32 U.S. government securities dealers— A17 Assets and liabilities, last Wednesday-of-month Transactions, positions, and financing series A33 Federal and federally sponsored credit agencies—Debt outstanding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

2 Federal Reserve Bulletin • November 1980 SECURITIES MARKETS AND International Statistics CORPORATE FINANCE A52 U.S. international transactions—Summary A34 New security issues—State and local A53 U.S. foreign trade governments and corporations A53 U.S. reserve assets A35 Open-end investment companies—Net sales and A54 Foreign branches of U.S. banks—Balance sheet asset position data A35 Corporate profits and their distribution A56 Selected U.S. liabilities to foreign official A36 Nonfinancial corporations—Assets and liabilities institutions A36 Business expenditures on new plant and equipment A37 Domestic finance companies—Assets and REPORTED BY BANKS IN THE UNITED STATES liabilities; business credit A56 Liabilities to and claims on foreigners A57 Liabilities to foreigners REAL ESTATE A59 Banks' own claims on foreigners A60 Banks' own and domestic customers' claims on A38 Mortgage markets foreigners A39 Mortgage debt outstanding A60 Banks' own claims on unaffiliated foreigners A61 Claims on foreign countries—Combined domestic offices and foreign branches CONSUMER INSTALLMENT CREDIT A40 Total outstanding and net change SECURITIES HOLDINGS AND TRANSACTIONS A41 Extensions and liquidations A62 Marketable U.S. Treasury bonds and notes- Foreign holdings and transactions FLOW OF FUNDS A62 Foreign official assets held at Federal Reserve Banks A42 Funds raised in U.S. credit markets A63 Foreign transactions in securities A43 Direct and indirect sources of funds to credit markets REPORTED BY NONBANKING BUSINESS ENTERPRISES IN THE UNITED STATES Domestic Nonfinancial Statistics A64 Liabilities to unaffiliated foreigners A65 Claims on unaffiliated foreigners A44 Nonfinancial business activity—Selected measures A44 Output, capacity, and capacity utilization A45 Labor force, employment, and unemployment INTEREST AND EXCHANGE RATES A46 Industrial production—Indexes and gross value A66 Discount rates of foreign central banks A48 Housing and construction A66 Foreign short-term interest rates A49 Consumer and producer prices A66 Foreign exchange rates A50 Gross national product and income A51 Personal income and saving A67 Guide to Tabular Presentation, Statistical Releases, and Special Tables 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 1980 Item 04 01 02 03 May June July Aug. Sept. Monetary and credit aggregates (annual rates of change, seasonally adjusted in percent)1 Member bank reserves 1 Total 12.3 4.2' 0.9' 6.9 -0.2' - 1.1' 3.0' 16.1 23.3 2 Required 11.2 5.3 1.2 6.1 0.3 -1.9' 0.5' 15.9' 24.4 3 Nonborrowed 6.2 3.3' 7.5' 12.3 45.5 18.4' 2.5' 8.3 4.1 4 Monetary base2 9.5 7.6 5.2 9.8 8.2 6.6 8.5 15.2 10.4 Concepts of monev and liquid assets3 5 M-l A 4.5 4.8 -3.9 11.0 .7 11.4 7.8 19.3 12.6 6 M-1B 5.0 5.9 -2.4 13.5 -1.2 14.6 11.1 21.6 15.8 7 M-2 7.1 7.2 5.5 15.5 9.4 18.1 18.2' 14.5' 8.5 8 M-3 9.1 7.8 5.7 12.5 8.7 13.4 13.4 13.6 9.1 9 L 8.5 8.3 7.7 n.a. 8.7' 6.9' 8.5' 14.3 n.a. Time and savings deposits Commercial banks 10 Total 12.4 8.4 9.8 4.2 6.6 -1.6 2.3 7.3 12.4 11 Savings4 -16.5 -19.3 -22.6 26.4 -7.5 32.9 38.6 26.5 7.6 12 Small-denomination time5 32.1 29.1 33.9 0.6 14.1 -3.1 -3.1 0.0 6.1 13 Large-denomination time6 19.7 11.3 10.1 -8.3 8.5 -24.8 -19.7 1.5 23.1 14 Thrift institutions7 6.7 2.7 5.0 10.0 7.3 10.8 9.0 11.5' 10.4 15 Total loans and securities at commercial banks8 8.6' 9.5' -.5 6.8 -6.2 -2.8 7.7 17.3 15.3 1979 1980 1980 Q4 01 02 Q3 June July Aug. Sept. Oct. Interest rates (levels, percent per annum) Short-term rates 1 1 6 7 F F e e d d e e r r a a l l f R u e n s d e s r 9 v e discount10 1 1 1 3 . . 9 5 2 8 1 12 5 . . 5 0 1 7 1 12 2 . . 4 6 5 7 1 9 0 . .3 8 5 2 1 9 1 . . 4 4 7 0 1 9 0 . . 0 8 3 7 1 9 0 . . 6 0 1 0 1 1 0 0 . . 8 1 7 7 1121..0810 18 Treasury bills (3-month market yield)11 11.84 13.35 9.62 9.15 7.07 8.06 9.13 10.27 11.62 19 Commercial paper (3-month)1112 13.35 14.54 11.18 9.65 8.27 8.41 9.57 10.97 12.52 Long-term rates Bonds 20 U.S. government13 10.18 11.78 10.58 10.95 9.89 10.32 11.07 11.47 11.75 21 State and local government14 7.20 8.23 7.95 8.58 7.63 8.13 8.67 8.94 9.11 22 Aaa utility (new issue)15 11.21 13.22 11.78 12.20 10.95 11.60 12.32 12.74 13.18 23 Conventional mortgages16 12.38 14.32 12.70 n.a. 12.45 12.45 13.25 13.65 14.10 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. Averages of daily effective rates (average of the rates on a given date weighted 3. M-1A: Averages of daily figures for (1) demand deposits at all commercial 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 Nonfinancial Statistics • November 1980 1.11 FACTORS AFFECTING MEMBER BANK RESERVES Millions of dollars Monthly averages of Weekly averages of daily figures for week-ending daily figures Factors 1980 1980 Aug .P Sept .P Oct.P Sept. 17P Sept. 24p Oct. IP Oct. 8p Oct. 15p Oct. 22p Oct. 29p SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding 139,277 139,919 141,695 139,879 141,523 140,110 141,188 143,228 2 U.S. government securities1 119,092 119,826 121,455 119.679 120.099 121.641 120,650 121,879 121,830 3 Bought outright 118,823 119,692 119.866 119.679 120.099 120,819 118,237 120.314 120,895 4 Held under repurchase agreements 269 134 1,589 822 2,413 1,565 935 5 Federal agency securities 8,978 8,858 9,206 8.782 8,782 9.056 9,354 9,101 9,262 6 Bought outright 8,873 8,809 8,769 8,782 8.782 8.781 8.779 8,776 8,761 7 Held under repurchase agreements 105 49 437 275 575 325 501 8 Acceptances 71 42 353 227 327 357 167 9 Loans 687 1,244 1.335 1,213 1.630 1.873 1,248 1.107 1,203 10 Float 5,098 4,761 3,722 5,054 4,386 3.374 3,214 3.341 5,113 11 Other Federal Reserve assets 5.351 5,188 5,624 5,151 5,315 5.351 5,316 5.403 5,653 12 Gold stock 11,172 11,170 11,165 11,171 11.169 11,168 11,167 11,165 11,165 13 Special drawing rights certificate account . 3,215 3,268 3.268 3.268 3.268 3,268 3.268 3,268 3.268 14 Treasury currency outstanding 13,339 13.344 13.358 13.332 13.337 13.387 13,346 13.350 13,363 ABSORBING RESERVE FUNDS 15 Currency in circulation 128,998 129,744 130,571 130.088 129.419 129.217 129,992 131.001 130,886 16 Treasury cash holdings 480 468 464 468 468 466 464 468 465 Deposits, other than member bank reserves. with Federal Reserve Banks 17 Treasury 3.297 3,237 3.196 3.032 3.126 4.268 3,302 3.306 3,201 18 Foreign 301 309 284 312 267 309 299 299 287 19 Other 475 367 330 438 325 421 283 306 303 20 Other Federal Reserve liabilities and capital 4,488 4,486 4.665 4.428 4.541 4.590 4,632 4.626 4,742 21 Reserve accounts2 28,965 29,090 29.976 28,884 29.841 30.075 28,919 28,964 31,140 End-of-month figures Wednesday figures 1980 Aug. Sept Oct. Sept. 17 Sept. 24 Oct. 1 Oct. 8 Oct. 15 SUPPLYING RESERVE FUNDS 22 Reserve bank credit outstanding 139,791 140,011 141,189 145,284 140,219 143,583 23 U.S. government securities1 119,848 120,711 121.482 118,541 120.713 122.058 117,173 119,460 121,472 24 Bought outright 119,014 119,418 119,852 118,541 120.713 119,509 117.173 119,460 121,472 25 Held under repurchase agreements ... 834 1,293 1.630 2.549 26 Federal agency securities 9,355 9.053 9.220 8,782 8,782 9,725 8,779 8,761 8,761 27 Bought outright 8,873 8,782 8.761 8.782 8.782 8.779 8,779 8,761 8,761 28 Held under repurchase agreements ... 482 271 459 946 29 Acceptances 277 499 566 623 30 Loans 1,515 982 1.567 590 3.617 3.264 623 567 3,966 31 Float 3,468 3,192 2,194 6,745 4,171 3.973 3,822 5,805 3,503 32 Other Federal Reserve assets 5,328 5,574 6,160 5,325 5,547 5,641 5,468 5,626 5,881 33 Gold stock 11,172 11,168 11,163 11.169 11,168 11,168 11,166 11,165 11,164 34 Special drawing rights certificate account . 3,268 3.268 3,268 3,268 3.268 3,268 3,268 3,268 3.268 35 Treasury currency outstanding 13,614 13,663 13,376 13.336 13,341 13,341 13,347 13,362 13,368 ABSORBING RESERVE FUNDS 36 Currency in circulation 129,667 129,917 130,733 130,057 129,530 129,756 130.798 131,520 130,945 37 Treasury cash holdings 467 466 462 468 467 462 470 467 465 Deposits, other than member bank reserves, with Federal Reserve Banks 38 Treasury 2,742 4,102 1,864 3,328 3,928 4,215 3.331 2,898 3,228 39 Foreign 336 460 368 234 301 313 272 325 236 40 Other 383 363 338 423 286 1,210 286 320 321 41 Other Federal Reserve liabilities and capital 4,570 4,659 4,713 4,376 4,430 4,734 4,372 4,562 4,506 42 Reserve accounts2 29,680 28,146 30,518 28,871 31.666 32,461 24,117 27,921 31,682 1. Includes securities loaned—fully guaranteed by U.S. government securities 2. Includes reserves of member banks, and Edge Act corporations, pledged with Federal Reserve Banks—and excludes (if any) securities sold and NOTE: For amounts of currency and coin held as reserves, see table 1.12. scheduled to be bought back under matched sale-purchase transactions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Member Banks A5 1.12 RESERVES AND BORROWINGS Member Banks Millions of dollars Monthly averages of daily figures Reserve classification 1979 1980 Dec. Feb. Mar. Apr. May June/' July/' Aug .P Sept .P Oct.P All member banks Reserves 1 At Federal Reserve Banks 32,473 31.878 32,400 33,663 32.726 32.189 31,454 28,965 29.090 29,976 2 Currency and coin 11.344 11.063 10.729 10,895 10.998 11,137 11.285 11,262 11.810 11,678 3 Total held1 43.972 43.156 43.352 44,769 43.933 43,531 42.927 40,408 41,077 41,815 4 Required 43.578 42,966 42,907 44.678 43,793 43,280 42.509 40,077 40,919 41,498 5 Excess1 394 190 445 91 140 251 418 331 158 317 Borrowings at Reserve Banks2 6 Total 1.473 1,655 2.828 2.443 1.028 365 390 687 1,244 1,335 7 Seasonal 82 96 152 156 64 12 5 9 24 67 Large banks in New York Citv 8 Reserves held 7.401 7,168 7.276 7.603 7,596 7,482 7.272 6,462 6,598 6,710 9 Required 7.326 7.205 7.194 7.655 7.662 7.600 7.278 6.507 6.647 6,741 10 Excess 75 -37 82 -52 -66 - 118 -6 -45 -49 -31 11 Borrowings2 66 125 60 81 31 18 54 99 152 117 Large banks in Chicago 12 Reserves held 2,036 1.968 1,886 2,150 1.922 1.868 1.785 1.528 1.629 1,654 13 Required 2,005 1.941 1.961 2.173 1,906 1,868 1.866 1.591 1.657 1,687 14 Excess 31 27 -75 -23 16 0 -81 -63 -28 -33 15 Borrowings2 90 97 137 60 28 1 20 26 111 29 Other large banks 16 Reserves held 17,426 17,246 17,029 17,644 17,379 17,049 16.642 15,756 15.905 16,188 17 Required 17,390 17,265 17,135 17,991 17,545 17.199 16.815 15.739 16,049 16,347 18 Excess 36 -19 -106 -347 -166 -150 -173 17 -144 -159 19 Borrowings2 707 729 1,479 1,287 808 319 296 479 682 751 All other banks 20 Reserves held 16,734 16,403 16.261 16,314 16,271 16.248 16.285 16.031 16,226 16,466 21 Required 16,536 16.229 16,233 16.367 16.234 16.186 16.137 15.925 16.251 16.392 22 Excess 198 174 28 -53 37 62 148 106 -25 74 23 Borrowings2 610 704 1,152 1,015 161 27 20 83 299 438 Edge corporations 24 Reserves held 336 328 331177 339 335 374 379 339 336 346 25 Required 303 303 300 299 295 332 354 315 315 331 26 Excess 33 25 17 40 40 42 25 24 21 15 U.S. agencies and branches3 27 Reserves held 39 43 9900 198 162 106 64 28 Required 18 23 8844 193 151 97 59 2299 Excess 2211 2200 6 5 1111 9 5 Weekly averages of daily figures for week (in 1980) ending Aug. IIP Sept. 3P Sept. 10 P Sept. 17 P Sept. 24P Oct. IP Oct. 8P Oct. 15 P Oct. 22P Oct. 29P All member banks Reserves 30 At Federal Reserve Banks 29,066 29.329 28,049 28.884 29,841 30.075 28.919 28,964 31.140 30,312 31 Currency and coin 11,135 11.592 12,064 11.658 11,631 12,011 12.090 12.050 10.882 11,541 32 Total held1 40,382 41.099 40,291 40.719 41,652 42.257 41.177 41.172 42.179 42,011 33 Required 40,293 40.610 40,052 40.415 41,598 41,879 40.783 40.959 42,111 41,930 34 Excess1 89 489 239 304 54 378 394 213 68 81 Borrowings at Reserve Banks2 35 Total 700 1.348 594 1.213 1,630 1.873 1.248 1.107 1,203 1,440 36 Seasonal 10 20 14 21 30 40 48 61 69 87 Large banks in New York City 37 Reserves held 6,427 6.437 6,451 6.528 6,595 7.041 6.797 6.373 6.675 6,557 38 Required 6,376 6.552 6,538 6.421 6,750 6,964 6.608 6.633 6.905 6,719 39 Excess 51 -115 -87 107 -155 77 189 -260 -230 -162 40 Borrowings2 161 61 195 171 154 247 46 0 225 71 Large banks in Chicago 41 Reserves held .... • 1,382 1.557 1.435 1.659 1,627 1.808 1.769 1.727 1,537 1,715 42 Required 1,597 1.635 1,613 1.701 1,651 1.675 1.628 1.684 1,713 1,718 43 Excess -215 -78 -178 -42 -24 133 141 43 -176 -3 44 Borrowings2 80 29 0 46 385 27 18 6 89 0 Other large banks 45 Reserves held 15,578 16,268 15.523 15,604 16.161 16,576 16,107 16.099 16,032 16,298 46 Required 15,883 15.987 15.613 15,858 16,362 16.446 16.072 16.182 16,596 16,494 47 Excess -305 281 -90 -254 -201 130 35 -83 -564 -196 48 Borrowings2 340 1,042 278 725 731 1.051 779 694 488 867 All other oanks 49 Reserves held 16,096 16,315 15,977 16,067 16.547 16,510 16.202 16.228 16,488 16,715 50 Required 16.113 16.139 15.961 16,091 16.532 16.506 16.149 16.131 16,563 16.658 51 Excess -17 176 16 -24 15 4 53 97 -75 57 52 Borrowings2 119 216 121 271 360 548 405 407 401 502 Edge corporations 53 Reserves held 360 332255 346 365 318 312 337 365 372 325 54 Required 324 297 327 344 303 288 326 329 334 341 55 Excess 36 28 19 21 15 24 11 36 38 -16 U.S. agencies and branches3 56 Reserves held 5577 Required 5588 Excess 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, Digitized fogrr aFdRuaAteSd EbaRsis over a 24-month period when a nonmember bank merged into an 2. Based on closing figures, http://frasere.xsisttloinug ismfeemd.boerr gb/ ank, or when a nonmember bank joins the Federal 3. Data not reported after July 23. 1980. Federal Reserve Bank of St. Louis

A6 Domestic Nonfinancial Statistics • November 1980 1.13 FEDERAL FUNDS AND REPURCHASE AGREEMENTS Large Member Banks' Averages of daily figures, in millions of dollars 1980, week ending Wednesday BByy mmaattuurriittyy aanndd ssoouurrccee Sept. 3r Sept. 10' Sept. 17' Sept. 24r Oct. 1 Oct. 8 Oct. 15 Oct. 22 Oct. 29 One day and continuing contract 1 Commercial banks in United States 51,672 55.938 54,808 50.245 50,660 54,742 53,439 49,801 47,442 2 Other depository institutions, foreign banks and foreign official institutions, and U.S. government agencies 14,732 15,465 15,779 15,191 15,189 15,272 15,835 15,973 15,230 3 Nonbank securities dealers 2,717 2.216 2,259 2,847 1,989 2,200 1,739 2,007 2,196 4 All other 17,829 16.758 16,693 16,587 16,917 16,823 15,775 17,144 17,235 All other maturities 5 Commercial banks in United States 3.613 3.766 3,717 3,511 3,653 3,304 5,210 3,723 3,791 6 Other depository institutions, foreign banks and foreign official institutions, and U.S. government agencies 5,505 5,374 5,693 5,887 6,044 6,051 6,551 6,749 6,866 7 Nonbank securities dealers 3.416 3,143 3,134 3,524 3,937 3,681 3,804 4,020 4,570 8 All other 10,777 11.078 10,494 10,091 10,614 10,258 11,344 10,536 11,007 MEMO: Federal funds and resale agreement loans in maturities of one day or continuing contract 9 Commercial banks in United States 12,787 13,361 14,938 12.945 14,378 13,873 15,138 12,504 12,203 10 Nonbank securities dealers 2,322 2.813 2,150 1,702 2,020 2,465 2,266 2,484 2,126 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 A7 1.14 FEDERAL RESERVE BANK INTEREST RATES Percent per annum Current and previous levels SShhoorrtt--tteerrmm Extended credit EEmmeerrggeennccyy ccrreeddiitt aaddjjuussttmmeenntt ccrreeddiitt ttoo aallll ootthheerrss FFFeeedddeeerrraaalll RRReeessseeerrrvvveee Seasonal credit Special circumstances1 uunnddeerr sseeccttiioonn 113322 BBBaaannnkkk Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous 10/31/80 date rate 10/31/80 date rate 10/31/80 date rate 10/31/80 date rate Boston 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 New York 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 Philadelphia 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 Cleveland 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 Richmond 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 Atlanta 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 Chicago 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 St. Louis 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 Minneapolis 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 Kansas City 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 Dallas 11 9/26/80 10 11 9/26/80 10 12 9/26/80 11 14 9/26/80 13 San Francisco .... 11 9/26/80 10 11 9/26/80' 10 12 9/26/80 11 14 9/26/80 13 Range of rates in recent years3 Range (or F.R. Range (or F.R. Range (or F.R. 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. Ba o n f k Effective date A le l v l e F l) . — R. Ba o n f k Banks N.Y. Banks N.Y. Banks N.Y. SVi 5Vz In effect Dec. 31, 1970 1974— Apr. 25 7^-8 8 11997788—— JJuullyy 3 7-71/4 71/4 1971— Jan. 8 51/4-5 Vi 51/4 30 8 8 10 7W73/4 71/4 1 1 5 9 5 5 -5 V 4V A 5 5 1 V / 4 4 Dec. 1 9 6 7 7 3 3 /4 /4 -8 7 73 3/ / 4 4 A Se u p g t . . 2 2 2 2 1 8 7 3/4 V i 8 7 3/4 22 5-51/4 5 1V4 Oct. 16 8-8 m8Vi Feb. 2 1 9 3 43/ 5 4 -5 5 5 1975— Jan. 1 6 0 7^4 7 7V V 4 4 Nov. 20 1 8V V i V i i 99 V V i i 19 43/4 43/4 24 71/4 7V4 3 9 July 16 43/4^5 5 Feb. 5 63/4-7 V4 63/4 Nov. 2 1 3 1 43A 5 -5 5 5 Mar. 1 7 0 61/ 6 4 3 - / 6 4 3 /4 66 3/V4 4 1979— A Ju u ly g . 2 1 0 7 10 1 - 0 1 V0 V i i 10 19 43/4 43/4 14 6V4 6V4 20 10 10 Vi Dec. 13 4^-43/4 43 V/4 i May 16 6-61/4 6 SSeepptt.. 19 10Vi-ll 11 17 AYi 4 5V2 21 11 11 24 4Vi 1976— Jan. 19 5V5S-V6 i Oct. 8 11-12 12 23 5V4-5V2 5V4 10 12 12 1973— Jan. 15 5 5 Nov. 22 5V4 Feb. 26 5-5 Vi 55VVi 2 26 5V4 1980— Feb. 15 12-13 13 Mar. 2 5h 5Vi 5V4 19 13 13 Apr. 23 5^-53/4 1977— Aug. 30 5 VV5 3/4 MMaayy 29 12-13 13 May 4 53/4 53/4 31 51/4-53/4 53/4 30 12 12 11 53/4-6 6 Sept. 2 53/4 53/4 June 13 11-12 11 18 6 6 Oct. 26 6 6 June 16 11 11 June 11 6—6'/2 66V^Y>2 ¥2 6V2 July 28 10-11 10 15 6 Vi 1978— Jan. 9 66-Y61 ¥2 July 29 10 10 1 20 eVb-i 16 SSeepptt.. 26 11 11 July 2 17- 1 Yi IVi May 11 1 1 Aug. 14 iVi IVi 12 23 In effect Oct.. 31, 1980 11 11 1. Applicable to advances when exceptional circumstances or practices involve 3. Rates for short-term adjustment credit (as described above). For description only a particular depository institution as described in section 201.3(b) (2) of and earlier data see the following publications of the Board of Governors: Banking Regulation A. and Monetary Statistics, 1914-1941 and 1941-1970; Annual Statistical Digest, 2. Applicable to emergency advances to individuals, partnerships, and corpo- 1971-1975, 1972-1976, 1973-1977, and 1974-1978. rations as described in section 201.3(c) of Regulation A. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 Domestic Financial Statistics • November 1980 1.15 DEPOSITORY INSTITUTIONS RESERVE REQUIREMENTS' Percent of deposits Member bank requirements Depository institution requirements before implementation of the after implementation of the TTyyppee ooff ddeeppoossiitt,, aanndd ddeeppoossiitt iinntteerrvvaall Monetary Control Act TTyyppee ooff ddeeppoossiitt,, aanndd Monetary Control Act6 iinn mmiilllliioonnss ooff ddoollllaarrss ddeeppoossiitt iinntteerrvvaall Percent Effective date Percent Effective date Net demand2 Net transaction accounts1 0-2 7 12/30/76 $0-$25 million 3 11/13/80 2-10 9Vz 12/30/76 Over $25 million 12 11/13/80 10-100 113/4 12/30/76 100-400 123/4 12/30/76 Nonpersonal time deposits8 Over 400 16VA 12/30/76 By original maturity Less than 4 years 3 11/13/80 Time and savings2-3-4 4 years or more 0 11/13/80 SSaavviinnggss 3 3/16/67 Eurocurrency liabilities Time5 All types 3 11/13/80 0-5, by maturity 30-179 days 3 33//1166//6677 180 days to 4 years 2Vi 1/8/76 4 years or more 1 10/30/75 Over 5, by maturity 30-179 days 6 1122//1122//7744 180 days to 4 years 2Vi 1/8/76 4 years or more 1 10/30/75 1. For changes in reserve requirements beginning 1963, see Board's Annual Effective with the reserve maintenance period beginning Oct. 25, 1979, a mar- Statistical Digest, 1971-1975 and for prior changes, see Board's Annual Report for ginal reserve requirement of 8 percent was added to managed liabilities in excess 1976, table 13. Under provisions of the Monetary Control Act, depository insti- of a base amount. This marginal requirement was increased to 10 percent beginning tutions include commercial banks, mutual savings banks, savings and loan asso- April 3, 1980, was decreased to 5 percent beginning June 12, 1980, and was reduced ciations, credit unions, agencies and branches of foreign banks, and Edge Act to zero beginning July 24, 1980. Managed liabilities are defined as large time corporations. deposits. Eurodollar borrowings, repurchase agreements against U.S. government 2. (a) Requirement schedules are graduated, and each deposit interval applies and federal agency securities, federal funds borrowings from nonmember instito that part of the deposits of each bank. Demand deposits subject to reserve tutions, and certain other obligations. In general, the base for the marginal reserve requirements are gross demand deposits minus cash items in process of collection requirement was originally the greater of (a) $100 million or (b) the average and demand balances due from domestic banks. amount of the managed liabilities held by a member bank, Edge corporation, or (b) The Federal Reserve Act as amended through 1978 specified different ranges family of U.S. branches and agencies of a foreign bank for the two statement of requirements for reserve city banks and for other banks. Reserve cities were weeks ending Sept. 26, 1979. For the computation period beginning Mar. 20, 1980, designated under a criterion adopted effective Nov. 9, 1972, by which a bank the base was lowered by (a) 7 percent or (b) the decrease in an institution's U.S. having net demand deposits of more than $400 million was considered to have the office gross loans to foreigners and gross balances due from foreign offices of other character of business of a reserve city bank. The presence of the head office of institutions between the base period (Sept. 13-26,1979) and the week ending Mar. such a bank constituted designation of that place as a reserve city. Cities in which 12, 1980, whichever was greater. For the computation period beginning May 29, there were Federal Reserve Banks or branches were also reserve cities. Any banks 1980, the base was increased by IVI percent above the base used to calculate the having net demand deposits of $400 million or less were considered to have the marginal reserve in the statement week of May 14-21, 1980. In addition, beginning character of business of banks outside of reserve cities and were permitted to Mar. 19, 1980, the base was reduced to the extent that foreign loans and balances maintain reserves at ratios set for banks not in reserve cities. declined. (c) Effective Aug. 24, 1978, the Regulation M reserve requirements on net 6. For existing nonmember banks and thrift institutions, there is a phase-in balances due from domestic banks to their foreign branches and on deposits that period ending Sept. 3, 1987. For existing member banks the phase-in period is foreign branches lend to U.S residents were reduced to zero from 4 percent and about three years, depending on whether their new reserve requirements are 1 percent, respectively. The Regulation D reserve requirement on borrowings greater or less than the old requirements. For existing agencies and branches of from unrelated banks abroad was also reduced to zero from 4 percent. foreign banks, the phase-in ends Aug. 12, 1982. All new institutions will have a (d) Effective with the reserve computation period beginning Nov. 16, 1978, two-year phase-in beginning with the date that they open for business. domestic deposits of Edge corporations were subject to the same reserve require- 7. Transaction accounts include all deposits on which the account holder is ments as deposits of member banks. permitted to make withdrawals by negotiable or transferable instruments, payment 3. Negotiable order of withdrawal (NOW) accounts and time deposits such as orders of withdrawal, telephone and preauthorized transfers (in excess of three Christmas and vacation club accounts were subject to the same requirements as per month), for the purpose of making payments to third persons or others. savings deposits. 8. In general, nonpersonal time deposits are time deposits, including savings 4. The average reserve requirement on savings and other time deposits at that deposits, that are not transaction accounts and in which the beneficial interest is time had to be at least 3 percent, the minimum specified by law. held by a depositor which is not a natural person. Also included are certain trans- 5. Effective Nov. 2, 1978, a supplementary reserve requirement of 2 percent ferable time deposits held by natural persons, and certain obligations issued to was imposed on large time deposits of $100,000 or more, obligations of affiliates, depository institution offices located outside the United States. For details, see and ineligible acceptances. This supplementary requirement was eliminated with section 204.2 of Regulation D. the maintenance period beginning July 24, 1980. NOTE. Required reserves must be held in the form of deposits with Federal Reserve Banks or vault cash. After implementation of the Monetary Control Act, nonmembers may maintain reserves on a pass-through basis with certain approved institutions. 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 Perccnt per annum Commercial banks Savings and loan associations and mutual savings banks Type and maturity of deposit In effect Oct. 31. 1980 Previous maximum In effect Oct. 31. 1980 Previous maximum Percent Effective Percent Effective Percent Effective date date date 5'/: 1 Savings 5'/4 7/1/79 7/1/73 7/1/79 5'/4 2 Negotiable order of withdrawal accounts 2 5 1/1/74 (3) 1/1/74 (3) Time accounts 4 Fixed ceiling rates by maturity 5 3 30-89 days ' ." 55-V !/4 4 8/1/79 51/1 7/1/73 (3) (3) 4 90 days to 1 vear 1/1/80 7/1/73 6 1/1/80 55-*V44 1 6 5 9 7 8 0 6 2 4 2 8 1 ' / t t t t y : o o o o e t a o 8 2 6 2 r V s 4 y y y i e e e o y y a a a r e e r r r a a s s s m r r 6 6 - s o s r 5 5 e 6 6 7 7 7> * ' '/ / /4 : : 4 12 1 6 7 7 / 1 2 / / / / 1 1 1 3 1 / / / / / 7 7 7 7 7 8 3 3 4 3 ( ( 7 3 ) ) 5 5 7 7 - - 1 V V / 4 4 4 1 1 1 1 / / / 1 2 2 2 / 1 1 1 1 / / / / 7 7 7 7 0 0 0 3 8 6 6 P i 3V ' / / /4 A 2 i 12 1 6 / 1 2 0 ( / / 1 ' 1 3 ) / ) / / 7 7 7 8 3 4 ( ( 7 3 ) ) 6 6 7 7 7 1 3 / / 2 4 11 Issued to governmental units (all maturities)* 8 6/1/78 7-V4 ' 12/23/74 8 6/1/78 12 Individual retirement accounts and Keogh (H.R. 10) 7-V4 73/4 plans (3 years or more)8-9 6/1/78 7/6/77 6/1/78 1 1 3 4 S 6 2 p V -m e i c o y ia n e l a t h r v s a m r o i r o a n b m l e e y o r c m e e i a li r n k g e t r a ti te m s e by d ep m o a s t i u t r s i lf t ) y 0 C 2 1 ) ) ( ( 1 n) 2) C3) <13) C2) (,3) 1. July 1, 1973. for mutual savings banks; July 6. 1973. for savings and loan market certificates issued beginning June 5, 1980. the interest rate ceilings will be associations. determined by the discount rate (auction average) of most recently issued six- 2. For authorized states only, federally insured commercial banks, savings and month U.S. Treasury bills as follows: loan associations, cooperative banks, and mutual savings banks in Massachusetts Bill rate Commercial bank ceiling Thrift ceiling and New Hampshire were first permitted to offer negotiable order of withdrawal 8.75 and above bill rate + VA percent bill rate + VA percent (NOW) accounts on Jan. 1, 1974. Authorization to issue NOW accounts was 8.50 to 8.75 bill rate + VA percent 9.00 extended to similar institutions throughout New England on Feb. 27. 1976. and 7.50 to 8.50 bill rate + VA percent bill rate + Vi percent in New York State on Nov. 10, 1978, and in New Jersey on Dec. 28. 1979. 7.25 to 7.50 7.75 bill rate + >/2 percent 3. No separate account category. Below 7.25 7.75 7.75 4. For exceptions with respect to certain foreign time deposits see the FEDERAL The prohibition against compounding interest in these certificates continues. In RESERVE BULLETIN for October 1962 (p. 1279), August 1965 (p. 1084). and Feb- addition, during the period May 29. 1980, through Nov. 1. 1980. commercial banks ruary 1968 (p. 167). may renew maturing six-month money market time deposits for the same depositor 5. No minimum denomination. Until July 1. 1979, a minimum of $1,000 was at the thrift institution ceiling interest rate. required for savings and loan associations, except in areas where mutual savings 12. Effective Jan. 1, 1980, commercial banks, savings and loan associations, and banks permitted lower minimum denominations. This restriction was removed for mutual savings banks were authorized to offer variable-ceiling nonnegotiable time deposits maturing in less than 1 year, effective Nov. 1. 1973. deposits with no required minimum denomination and with maturities of 2Vi years 6. No minimum denomination". Until July 1. 1979, minimum denomination was or more. The maximum rate for commercial banks is *4 percentage point below $1,000 except for deposits representing funds contributed to an Individual Retire- the yield on 2'/2-year U.S. Treasury securities; the ceiling rate for thrift institutions ment Account (IRA) or a Keogh (H.R. 10) plan established pursuant to the is VA percentage point higher than that for commercial banks. Effective Mar. 1. Internal Revenue Code. The $1,000 minimum requirement was removed for such 1980, a temporary ceiling of 11*4 percent was placed on these accounts at comaccounts in December 1975 and November 1976 respectively. mercial banks; the temporary ceiling is 12 percent at savings and loan associations 7. Between July 1, 1973. and Oct. 31. 1973, there was no ceiling for certificates and mutual savings banks. Effective for all variable ceiling nonnegotiable time maturing in 4 years or more with minimum denominations of $1,000: however, deposits with maturities of 2Vi years or more issued beginning June 2. 1980. the the amount of such certificates that an institution could issue was limited to 5 ceiling rates of interest will be determined as follows: percent of its total time and savings deposits. Sales in excess of that amount, as Treasury yield Commercial bank ceiling Thrift ceiling well as certificates of less than $1,000, were limited to the 6'/2 percent ceiling on 12.00 and above 11.75 12.00 time deposits maturing in 2Vi years or more. 9.50 to 12.00 Treasury yield - VA percent Treasury vield Effective Nov. 1. 1973, ceilings were reimposed on certificates maturing in 4 Below 9.50 9.25 9.50 years or more with minimum denomination of $1,000. There is no limitation on Interest may be compounded on these time deposits. The ceiling rates of interest the amount of these certificates that banks can issue. at which these accounts may be offered vary biweekly. The maximum allowable 8. Accounts subject to fixed rate ceilings. See footnote 6 for minimum denom- rates in October for commercial banks were as follows: Oct. 2. 11.75; Oct. 16. ination requirements. 11.30: Oct. 30, 11.75. The maximum allowable rates in October for thrift insti- 9. Effective January 1, 1980, commercial banks are permitted to pay the same tutions were as follows: Oct. 2, 12.00; Oct. 16. 11.55; Oct. 30. 12.00. rate as thrifts on IRA and Keogh accounts and accounts of governmental units 13. Between July 1, 1979, and Dec. 31, 1979. commercial banks, savings and when such deposits are placed in the new 2'/2-year or more variable ceiling cer- loan associations, and mutual savings banks were authorized to offer variable tificates or in 26-week money market certificates regardless of the level of the ceiling accounts with no required minimum denomination and with maturities of Treasury bill rate. 4 years or more. The maximum rate for commercial banks was l'/4 percentage 10. Must have a maturity of exactly 26 weeks and a minimum denomination of points below the yield on 4-year U.S. Treasury securities; the ceiling rate for thrift $10,000. and must be nonnegotiable.' institutions was VA percentage point higher than that for commercial banks. 11. Commercial banks, savings and loan associations, and mutual savings banks NOTE. Before Mar. 31. 1980, the maximum rates that could be paid by federally were authorized to offer money market time deposits effective June 1, 1978. The insured commercial banks, mutual savings banks, and savings and loan associations ceiling rate for commercial banks on money market time deposits entered into were established by the Board of Governors of the Federal Reserve System, the before June 5, 1980, is the discount rate (auction average) on most recently issued Board of Directors of the Federal Deposit Insurance Corporation, and the Federal six-month U.S. Treasury bills. Until Mar. 15, 1979. the ceiling rate for savings Home Loan Bank Board under the provisions of 12 CFR 217. 329, and 526. and loan associations and mutual savings banks was '/4 percentage point higher respectively. Title II of the Depository Institutions Deregulation and Monetary than the rate for commercial banks. Beginning March 15. 1979. the '/4-percentage- Control Act of 1980 (P.L. 96-221) transferred the authority of the agencies to point interest differential is removed when the six-month Treasury bill rate is 9 establish maximum rates of interest payable on deposits to the Depository Instipercent or more. The full differential is in effect when the six-month bill rate is tutions Deregulation Committee. The maximum rates on time deposits in denom- 83/4 percent or less. Thrift institutions may pay a maximum 9 percent when the six- inations of $100,000 or more with maturities of 30-89 days were suspended in June month bill rate is between 8*4 and 9 percent. Also effective March 15. 1979. 1970; such deposits maturing in 90 days or more were suspended in May 1973. For interest compounding was prohibited on six-month money market time deposits information regarding previous interest rate ceilings on all types of accounts, see at all offering institutions. The maximum allowable rates in October for commercial earlier issues of the FEDERAL RESERVE BULLETIN, the Federal Home Loan Bank banks and thrift institutions were as follows: Oct. 2. 11.968; Oct. 9. 11.390; Oct. Board Journal, and the Annual Report of the Federal Deposit Insurance Corpo- 16, 11.531; Oct. 23, 11.657; Oct. 30, 12.534. Effective for all six-month money ration. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 Domestic Nonfinancial Statistics • November 1980 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS Millions of dollars 1980 TTyyppee ooff ttrraannssaaccttiioonn 11997777 11997788 11997799 Mar. Apr. May June July Aug. Sept. U.S. GOVERNMENT SECURITIES Outright transactions (excluding matched salepurchase transactions) Treasury bills 1 Gross purchases 13,738 16,628 15,998 1,370 2,428 838 322 0 0 200 2 Gross sales 7,241 13,725 6,855 0 108 232 0 2,264 47 237 3 Exchange 0 0 0 0 0 0 274 0 0 0 4 Redemptions 2,136 2,033 2,900 0 0 0 0 950 0 0 Others within 1 year1 5 Gross purchases 3,017 1,184 3,203 292 109 155 121 0 137 0 6 Gross sales 0 0 0 0 0 0 0 0 0 0 7 Maturity shift 4,499 -5.170 17,339 921 179 1,670 412 311 2,423 589 9 8 E R x e c d h e a m n p g t e i ons 2 500 -11 2 , , 3 6 0 0 8 0 -809 0 -459 0 -5,276 0 -1,479 0 -788 0 -3,134 0 -1,459 0 1 to 5 years 10 Gross purchases 2,833 4,188 2,148 355 373 405 465 0 541 0 11 Gross sales 0 0 0 0 0 0 0 0 0 0 1 1 3 2 E M x a c t h u a r n it g y e shift 178 -12 7 , , 6 5 9 0 3 8 -9 8 2 0 1 9 -1 4 7 5 9 9 -1 3 , , 3 0 0 0 2 0 - 1 4 ,4 1 7 2 9 -3 7 1 8 1 8 - 1 7 ,7 2 5 0 0 - 1 5 ,4 8 5 9 9 5 to 10 years 14 Gross purchases 758 1,526 523 107 62 133 164 0 236 0 15 Gross sales 0 0 0 0 0 0 0 0 0 0 1 1 6 7 M Ex a c t h u a ri n t g y e shift 584 2,803 -4 2 , , 6 1 4 8 6 1 0 0 0 0 1 - ,3 2 0 5 0 0 0 0 0 -1 1 ,7 ,0 0 0 3 0 0 0 Over 10 years 18 Gross purchases 553 1,063 454 81 64 216 129 0 320 0 19 Gross sales 0 0 0 0 0 0 0 0 0 0 2 2 1 0 E M x a c t h u a r n it g y e shift 1,565 2,545 1,619 0 0 0 0 0 -3 9 4 7 2 6 0 0 0 0 384 0 0 0 All maturities1 22 Gross purchases 20,898 24,591 22,325 2,206 3,036 1,747 1,200 0 1,234 200 23 Gross sales 7,241 13,725 6,855 0 108 232 0 2,264 47 237 24 Redemptions 4,636 2,033 5,500 0 0 0 0 950 0 0 Matched transactions 25 Gross sales 425,214 511,126 627,350 55,658 57,316 49,934 50,590 48,370 72,315 55,766 26 Gross purchases 423,841 510,854 624,192 54,636 57,479 50,965 52,076 46,023 71,645 56,207 Repurchase agreements 27 Gross purchases 178,683 151,618 107,051 6,682 3,029 7,717 12,810 10,719 2,783 3,203 28 Gross sales 180,535 152,436 106,968 6.379 3,952 4.811 15,258 10,110 3,016 2,743 29 Net change in U.S. government securities 5,798 7,743 6,896 1,486 2,168 5,452 238 -4,952 284 863 FEDERAL AGENCY OBLIGATIONS Outright transactions 30 Gross purchases 1,433 301 853 0 668 0 0 0 0 0 31 Gross sales 0 173 399 0 0 0 0 0 0 0 32 Redemptions 223 235 134 5 2 0 2 2 * 91 Repurchase agreements 33 Gross purchases 13,811 40,567 37,321 1,883 483 1,611 3,035 1,737 1,082 977 34 Gross sales 13,638 40,885 36,960 1,834 563 1,258 3,351 1,242 1,132 1,188 35 Net change in federal agency obligations 1,383 -426 681 45 586 353 -318 492 -50 -302 BANKERS ACCEPTANCES 36 Outright transactions, net -196 0 0 0 0 0 0 0 0 0 37 Repurchase agreements, net 159 -366 116 -34 -171 366 7 -64 -33 222 38 Net change in bankers acceptances -37 -366 116 -34 -171 366 7 -64 -33 222 39 Total net change in System Open Market Account 7,143 6,951 7,693 1,497 2,582 6,171 -73 -4,523 202 784 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 Oct. 1 Oct. 8 Oct. 15 Oct. 22 Oct. 29 Aug. Sept. Oct. Consolidated condition statement ASSETS 1 Gold certificate account 11.168 11.166 11.165 11,164 11,163 11,172 11,168 11,163 2 Special drawing rights certificate account 3.268 3.268 3.268 3,268 3,268 3,268 3,268 3,268 3 Coin 421 415 418 419 417 405 427 429 Loans 4 Member bank borrowings 3.264 623 567 3.966 2,740 1.515 982 1,567 5 Other 0 0 0 0 0 0 0 0 Acceptances 6 Held under repurchase agreements 623 0 0 0 426 277 499 566 Federal agency obligations 7 Bought outright 8.779 8.779 8.761 8.761 8,761 8.873 8.782 8,761 8 Held under repurchase agreements 946 0 0 0 167 482 271 459 U.S. government securities Bought outright 9 Bills 43.998 41.662 43,949 45.961 45.004 43,503 43.907 44,341 10 Notes 58.703 58,703 58.703 58,703 58.703 58,703 58,703 58,703 11 Bonds 16.808 16.808 16.808 16,808 16,808 16,808 16,808 16,808 12 Total1 119.509 117.173 119.460 121,472 120.515 119.014 119,418 119,852 13 Held under repurchase agreements 2.549 0 0 0 921 834 1.293 1,630 14 Total U.S. government securities 122,058 117.173 119.460 121.472 121.436 119,848 120.711 121,482 15 Total loans and securities 135,670 126,575 128,788 134,199 133,530 130,995 131,245 132,835 16 Cash items in process of collection 10,975 10.482 15.456 9,980 9,780 9,721 12,481 8,691 17 Bank premises 451 452 451 452 453 449 450 453 Other assets 18 Denominated in foreign currencies2 2,259 2.285 2.297 2.529 2,754 2,235 2,245 2,750 19 All other 2.931 2,731 2.878 2.900 2,961 2,645 2,879 2,957 20 Total assets 167,143 157,374 164,721 164,911 164,326 160,890 164,163 162,546 LIABILITIES 21 Federal Reserve notes 117,298 118,336 119.044 118.461 118,491 116,925 117,144 118,248 Deposits Reserve accounts 22 Member banks 32.461 24,117 27.921 31.682 31,770 29,338 28,146 30,518 23 Edge Act corporations 0 0 0 0 0 342 0 0 24 Total 32,461 24.117 27.921 31.682 31,770 29,680 28,146 30,518 25 U.S. Treasury—General account 4.125 3.331 2.898 3.228 2,877 2,742 4,102 1,864 26 Foreign—Official accounts 313 272 325 236 260 336 460 368 27 Other 1,210 286 320 321 316 383 363 338 28 Total deposits 38,109 28,006 31,464 35,467 35,223 33,141 33,071 33,088 29 Deferred availability cash items 7,002 6.660 9,651 6,477 6.094 6,254 9,289 6,497 30 Other liabilities and accrued dividends3 2,139 1.797 1.958 1.899 1.903 1,879 1,877 2,042 31 Total liabilities 164,548 154,799 162,117 162,304 161,711 158,199 161,381 159,875 CAPITAL ACCOUNTS 32 Capital paid in 1,184 1.184 1.190 1.196 1,198 1,180 1,184 1,199 33 Surplus 1,145 1.145 1.145 1,145 1,145 1,145 1,145 1,145 34 Other capital accounts 266 246 269 266 272 366 453 327 35 Total liabilities and capital accounts 167,143 157,374 164,721 164,911 164,326 160,890 164,163 162,546 36 MEMO: Marketable U.S. government securities held in custody for foreign and international account 84.379 85.185 86,363 85,599 85,677 84,331 84.526 86,150 Federal Reserve note statement 37 Federal Reserve notes outstanding (issued to Bank) 137,355 137,394 137.407 137.782 137,922 134,781 137,292 137,871 38 Less-held by bank4 20.057 19,058 18,363 19,180 19,431 n.a. 20,148 19,623 39 Federal Reserve notes, net 117,298 118,336 119.044 118.602 118,491 n.a. 117,144 118,248 Collateral for Federal Reserve notes 40 Gold certificate account 11,168 11,166 11,165 11,164 11,163 11,172 11.168 11,163 41 Special drawing rights certificate account 3,268 3,268 3.268 3,268 3,268 3,268 3,268 3,268 42 Other eligible assets 0 0 0 0 0 553 0 0 43 U.S. government and agency securities 102,862 103,902 104.611 104,170 104,060 119,788 102,708 103,817 44 Total collateral 117,298 118,336 119,044 118,602 118,491 134,781 117,144 118,248 1. Includes securities loaned—fully guaranteed by U.S. government securities 3. Includes exchange-translation account reflecting the monthly revaluation at pledged with Federal Reserve Banks—and excludes (if any) securities sold and market exchange rates of foreign-exchange commitments. scheduled to be bought back under matched sale-purchase transactions. 4. Beginning September 1980. Federal Reserve notes held by the Reserve Bank 2. Includes U.S. government securities held under repurchase agreement against are exempt from the collateral requirement. receipt of foreign currencies and foreign currencies warehoused for the U.S. Treasury. Assets shown in this line are revalued monthly at market exchange rates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A12 DomesticN onfinancial Statistics • November 1980 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holdings Millions of dollars Wednesday End of month TTTyyypppeee aaannnddd mmmaaatttuuurrriiitttyyy gggrrrooouuupppiiinnngggsss 1980 1980 Oct. 1 Oct. 8 Oct. 15 Oct. 22 Oct. 29 Aug. 31 Sept. 30 Oct. 31 1 Loans—Total 3,264 623 567 3,966 2,740 1,515 982 1,567 2 Within 15 days 3,242 582 518 3,956 2,730 1,510 973 1,550 3 16 days to 90 days 22 41 49 10 10 5 9 17 4 91 days to 1 year 0 0 0 0 0 0 0 0 5 Acceptances—Total 623 0 0 0 426 277 499 566 6 Within 15 days 623 0 0 0 426 277 499 566 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 9 U.S. government securities—Total 122,058 117,173 119,460 121,472 121,436 119,848 120,711 121,482 10 Within 15 days1 5,380 3,167 1,575 4,985 4,850 3,394 3,168 2,993 11 16 days to 90 days 21,614 20,724 23,644 21,671 21,894 20,302 22,479 24,059 12 91 days to 1 year 30,751 28,969 29,928 30,504 30,379 32,139 30,751 30,293 13 Over 1 year to 5 years 36,336 36,336 36,336 36,336 36,336 36,037 36,336 36,160 14 Over 5 years to 10 years 13,135 13,135 13,135 13,134 13,135 13,134 13,135 13,135 15 Over 10 years 14,842 14,842 14,842 14,842 14,842 14,842 14,842 14,842 16 Federal agency obligations—Total 9,725 8,779 8,761 8,761 8,928 9,355 9,053 9,220 17 Within 15 days* 964 131 112 63 63 769 522 63 18 16 days to 90 days 508 576 576 544 711 607 508 1,003 19 91 days to 1 year 1,542 1,361 1,436 1,467 1,558 1,249 1,312 1,558 20 Over 1 year to 5 years 4,818 4,818 4,758 4,862 4,771 4.802 4,818 4,771 21 Over 5 years to 10 years 1,208 1,208 1,194 1,140 1,140 1,184 1,149 1,140 22 Over 10 years 685 685 685 685 685 744 744 685 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. 1980 BBaannkk ggrroouupp,, oorr ttyyppee ooff ccuussttoommeerr 11997777 11997788 11997799 May June July Aug. Sept. Debits to demand deposits1 (seasonally adjusted) 11111111 AAAAAAAAllllllllllllllll ccccccccoooooooommmmmmmmmmmmmmmmeeeeeeeerrrrrrrrcccccccciiiiiiiiaaaaaaaallllllll bbbbbbbbaaaaaaaannnnnnnnkkkkkkkkssssssss 34,322.8 40,297.8 49,750.7 61,354.5 61,574.7 63,088.5 65,385.9 65,111.5 22222222 MMMMMMMMaaaaaaaajjjjjjjjoooooooorrrrrrrr NNNNNNNNeeeeeeeewwwwwwww YYYYYYYYoooooooorrrrrrrrkkkkkkkk CCCCCCCCiiiiiiiittttttttyyyyyyyy bbbbbbbbaaaaaaaannnnnnnnkkkkkkkkssssssss 13,860.6 15,008.7 18,512.2 25,508.0 24,788.9 25,538.8 26,705.7 26,103.5 33333333 OOOOOOOOtttttttthhhhhhhheeeeeeeerrrrrrrr bbbbbbbbaaaaaaaannnnnnnnkkkkkkkkssssssss 20,462.2 25,289.1 31,238.5 35,846.4 36,785.7 37,549.8 38,680.2 39,008.0 Debits to savings deposits2 (not seasonally adjusted) 44444444 AAAAAAAATTTTTTTTSSSSSSSS////////NNNNNNNNOOOOOOOOWWWWWWWW33333333 5.5 17.1 83.3 137.8 158.7 161.6 145.2 175.0 55555555 BBBBBBBBuuuuuuuussssssssiiiiiiiinnnnnnnneeeeeeeessssssssssssssss44444444 21.7 56.7 77.4 79.0 80.2 85.1 84.9 91.4 66666666 OOOOOOOOtttttttthhhhhhhheeeeeeeerrrrrrrrssssssss55555555 152.3 359.7 557.6 604.8 587.5 633.7 631.1 719.2 77777777 AAAAAAAAllllllllllllllll aaaaaaaaccccccccccccccccoooooooouuuuuuuunnnnnnnnttttttttssssssss 179.5 432.9 718.2 821.6 826.4 880.4 861.2 985.6 Demand deposit turnover1 (seasonally adjusted) 88888888 AAAAAAAAllllllllllllllll ccccccccoooooooommmmmmmmmmmmmmmmeeeeeeeerrrrrrrrcccccccciiiiiiiiaaaaaaaallllllll bbbbbbbbaaaaaaaannnnnnnnkkkkkkkkssssssss 129.2 139.4 163.4 202.9 201.5 203.7 205.5 202.1 99999999 MMMMMMMMaaaaaaaajjjjjjjjoooooooorrrrrrrr NNNNNNNNeeeeeeeewwwwwwww YYYYYYYYoooooooorrrrrrrrkkkkkkkk CCCCCCCCiiiiiiiittttttttyyyyyyyy bbbbbbbbaaaaaaaannnnnnnnkkkkkkkkssssssss 503.0 541.9 646.2 871.8 817.1 844.5 859.6 818.5 1111111100000000 OOOOOOOOtttttttthhhhhhhheeeeeeeerrrrrrrr bbbbbbbbaaaaaaaannnnnnnnkkkkkkkkssssssss 85.9 96.8 113.2 131.2 133.7 134.4 134.7 134.4 Savings deposit turnover2 (not seasonally adjusted) 1111111111111111 AAAAAAAATTTTTTTTSSSSSSSS////////NNNNNNNNOOOOOOOOWWWWWWWW33333333 6.5 7.0 7.8 9.9 10.2 9.7 8.2 9.4 1111111122222222 BBBBBBBBuuuuuuuussssssssiiiiiiiinnnnnnnneeeeeeeessssssssssssssss44444444 4.1 5.1 7.2 8.9 8.6 8.5 7.9 8.5 1111111133333333 OOOOOOOOtttttttthhhhhhhheeeeeeeerrrrrrrrssssssss55555555 1.5 1.7 2.9 3.6 3.4 3.6 3.5 4.0 1111111144444444 AAAAAAAAllllllllllllllll aaaaaaaaccccccccccccccccoooooooouuuuuuuunnnnnnnnttttttttssssssss 1.7 1.9 3.3 4.3 4.2 4.3 4.1 4.7 1. Represents accounts of individuals, partnerships, and corporations, and of NOTE: Historical data for the period 1970 through June 1977 have been estistates and political subdivisions. mated; these estimates are based in part on the debits series for 233 SMSAs, which 2. Excludes special club accounts, such as Christmas and vacation clubs. were available through June 1977. Back data are available from Publications Serv- 3. Accounts authorized for negotiable orders of withdrawal (NOW) and accounts ices, Division of Administrative Services, Board of Governors of the Federal authorized for automatic transfer to demand deposits (ATS). ATS data availability Reserve System, Washington, D.C. 20551. Debits and turnover data for savings starts with December 1978. deposits are not available before July 1977. 4. Represents corporations and other profit-seeking organizations (excluding commercial banks but including savings and loan associations, mutual savings banks, credit unions, the Export-Import Bank, and federally sponsored lending agencies). 5. Savings accounts other than NOW; business; and, from December 1978, ATS. 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 1980 T 1976 1977 1978 1979 Dec. Apr. May June July Aug. Sept. Seasonally adjusted MEASURES1 1 M-1A 305.0 328.4 351.6 369.7 367.6 367.8 371.3 373.7 379.7 383.6 2 M-1B 307.7 332.5 359.9 386.4 386.6 386.2 390.9 394.5 401.6 406.7 3 M-2 1,166.7 1,294.1 1,401.5 1,525.5 1,549.9 1,562.1 1,585.7 1,609.7' 1,629.2' 1,641.3 4 M-3 1,299.7 1,460.3 1,623.6 1,775.5 1,811.1 1,824.2 1,844.5 1,865.1 1,886.3' 1,902.6 5 L2 1,523.5 1,715.5 1,927.7 2,141.1 2,200.7 2,216.6' 2,229.3' 2,245.0' 2,271.8 n.a. COMPONENTS 6 Currency 80.7 88.7 97.6 106.3 109.0 110.1 111.0 112.0 113.4 113.9 7 Demand deposits 224.4 239.7 253.9 263.4 258.6 257.7 260.3 261.6 266.3 269.8 8 Savings deposits 447.7 486.5 476.1 416.7 377.3 372.7 381.4 393.7' 403.8' 408.6 9 Small-denomination time deposits3 396.6 454.9 533.8 656.5 708.3 718.0 719.6 717.2' 717.2' 720.9 10 Large-denomination time deposits4 118.0 145.2 194.7 219.4 234.2 235.0 230.7 226.2 225.4 230.4 Not seasonally adjusted MEASURES1 11 M-1A 313.5 337.2 360.9 379.2 370.9 362.2 370.1 375.7 377.5 382.9 12 M-1B 316.1 341.3 369.3 396.0 389.9 380.5 389.7 396.5 399.4 406.0 13 M-2 1,169.1 1,295.9 1,403.7 1,527.3 1,558.1 1,559.2 1,587.5 1,615.1 1,626.2' 1,639.3 14 M-3 1,303.8 1,464.5 1,629.2 1,780.8 1,817.3 1,820.1 1,843.9 1,868.2 1,883.3 1,900.3 15 L2 1,527.1 1,718.5 1,931.1 2,143.6 2,208.7 2,210.9' 2,227.5' 2,246.3' 2,267.7 n.a. COMPONENTS 16 Currency 82.1 90.3 99.4 108.2 108.7 109.9 111.1 112.7 113.7' 113.7 17 Demand deposits 231.3 247.0 261.5 271.0 262.2 252.2 259.0 263.0 263.9 269.2 18 Other checkable deposits5 2.7 4.1 8.3 16.7 19.0 18.4 19.6 20.8 21.9 23.2 19 Overnight RPs and Eurodollars6 13.6 18.6 23.9 25.3 20.3 21.3 22.5 26.6 28.9 29.9 20 Money market mutual funds 3.4 3.8 10.3 43.6 60.4 66.8 74.2 80.6 80.7 78.2 21 Savings deposits 444.9 483.2 472.9 413.8 379.7 374.4 383.6 396.7' 404.6' 408.9 22 Small-denomi «ation time deposits3 393.5 451.3 529.8 651.5 710.9 719.1 720.4 717.8' 715.6' 719.3 23 Large-denomination time deposits4 119.7 147.7 198.2 223.0 232.2 233.9 228.4 223.8 225.4 230.1 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-denomination time deposits are those issued in amounts of less than Reserve float; and (2) currency outside the Treasury, Federal Reserve Banks, and $100,000. the vaults of commercial banks. 4. Large-denomination time deposits are those issued in amounts of $100,000 M-1B: M-1A plus negotiable order of withdrawal and automatic transfer service or more and are net of the holdings of domestic banks, thrift institutions, the U.S. accounts at banks and thrift institutions, credit union share draft accounts, and government, money market mutual funds, and foreign banks and official institudemand deposits at mutual savings banks. tions. M-2: M-1B plus savings and small-denomination time deposits at all depository 5. Includes ATS and NOW balances at all institutions, credit union share draft institutions, overnight repurchase agreements at commercial banks, overnight balances, and demand deposits at mutual savings banks. Eurodollars held by U.S. residents other than banks at Caribbean branches of 6. Overnight (and continuing contract) RPs are those issued by commercial member banks, and money market mutual fund shares. banks to the nonbank public, and overnight Eurodollars are those issued by Ca- M-3: M-2 plus large-denomination time deposits at all depository institutions ribbean branches of member banks to U.S. nonbank customers. and term RPs at commercial banks and savings and loan associations. NOTE. Latest monthly and weekly figures are available from the Board's H.6(508) release. Back data are available from the Banking Section, Division of Research and Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Nonfinancial Statistics • November 1980 1.22 AGGREGATE RESERVES AND DEPOSITS Member Banks Billions of dollars, averages of daily figures 1980 Item 1977 1978 1979 Dec. Dec. Dec. Mar. Apr. May June July Aug. Sept. Seasonally adjusted 1 Reserves1 36.00 41.16 43.57 43.67 44.85 44.45 43.96 42.78 40.75 41.54 2 Nonborrowed 35.43 40.29 42.10 40.85 42.40 43.43 43.58 42.39 40.09 40.23 3 Required 35.81 40.93 43.13 43.48 44.65 44.27 43.76 42.51 40.45 41.27 4 Monetary base2 127.6 142.2 153.8 156.7 157.9 158.5 158.9 158.8 158.2 159.5 5 Deposits subject to reserve requirements3 567.6 616.1 644.4 649.1 655.4 656.8 658.0 658.5 667.8 678.2 6 Time and savings 385.6 428.8 451.1 457.9 464.2 467.7 467.9 467.0 474.2 482.0 Demand 7 Private 178.5 185.1 191.5 189.4 188.7 187.3 188.4 189.1 191.5 194.5 8 U.S. government 3.5 2.2 1.8 1.8 2.4 1.8 1.7 2.5 2.1 1.8 Not seasonally adjusted 9 Monetary base2 129.8 144.6 156.3 154.9 157.5 157.8 158.6 159.6 158.0 159.0 10 Deposits subject to reserve requirements3 575.3 624.0 652.6 648.0 657.7 651.5 656.9 658.2 662.5 675.6 11 Time and savings 386.4 429.6 452.0 460.6 464.7 467.7 467.4 466.0 471.8 479.6 Demand 12 Private 185.1 191.9 198.6 185.5 190.4 182.1 187.2 190.0 189.0 193.9 13 U.S. government 3.8 2.5 2.0 1.9 2.6 1.7 2.3 2.2 1.7 2.1 1. Member bank reserve series reflect actual reserve requirement percentages 2. Includes total reserves (member bank reserve balances in the current week with no adjustment to eliminate the effect of changes in Regulations D and M. plus vault cash held two weeks earlier); currency outside the U.S. Treasury, Federal Effective Nov. 2, 1978, a supplementary reserve requirement of 2 percentage Reserve Banks, and the vaults of commercial banks; and vault cash of nonmember points was imposed on time deposits of $100,000 or more. This action increased banks. required reserves approximately $3.0 billion in the week beginning Nov. 16, 1978. 3. Includes total time and savings deposits and net demand deposits as defined Effective Oct. 11, 1979, an 8 percentage point marginal reserve requirement was by Regulation D. Private demand deposits include all demand deposits except imposed on "managed liabilities" (liabilities that have been actively used to finance those due to the U.S. government, less cash items in process of collection and rapid expansion in bank credit). On Oct. 25, 1979, reserves of Edge Act corpo- demand balances due from domestic commercial banks. rations were included in member bank reserves. This action raised required reserves $318 million. Effective Mar. 12, 1980, the marginal reserve requirement of NOTE. Latest monthly and weekly figures are available from the Board's 8 percentage points was raised to 10 percentage points. In addition the base upon H.3(502) statistical release. Back data and estimates of the impact on required which the marginal reserve requirement is calculated was reduced. This action reserves and changes in reserve requirements are available from the Banking increased required reserves about $1,693 million in the week ending April 2, 1980. Section, Division of Research and Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Aggregates A15 1.23 LOANS AND SECURITIES All Commercial Banks' Billions of dollars; averages of Wednesday figures 1980 1980 CCCaaattteeegggooorrryyy 1977 1978 1979 1977 1978 1979 DDeecc.. DDeecc.. DDeecc.. AAuugg.. SSeepptt.. Aug. SSeepptt.. Seasonally adjusted Not seasonally adjusted 1 Total loans and securities2 891.1 1,014.33 1,132.5* 1,176.2 1,191.2 899.1 1,023.83 1,143.04 1,175.8 1,192.9 2 U.S. Treasury securities 99.5 93.4 93.8 104.4 106.5 100.7 94.6 95.0 102.3 104.7 3 Other securities 159.6 173.13 191.5 207.0 207.9 160.2 173.93 192.3 206.5 207.9 4 Total loans and leases2 632.1 747.83 847.24 864.8 876.7 638.3 755.43 855.74 867.0 880.3 5 Commercial and industrial loans 211.25 246.5 6 290.5 4 301.2 307.4 212.65 248.26 292.44 301.0 307.3 6 Real estate loans 175.25 210.5 242.44 252.4 253.7 175.55 210.9 242.94 253.2 254.9 7 Loans to individuals 138.2 164.9 182.7 171.5 171.4 139.0 165.9 183.8 173.1 173.4 8 Security loans 20.6 19.4 18.3 15.8 15.5 22.0 20.7 19.6 15.9 15.5 9 Loans to nonbank financial institutions . 25.85 27.17 30.34 28.3 28.6 26.3s 27.67 30.84 28.6 29.1 10 Agricultural loans 25.8 28.2 31.0 32.7 33.0 25.7 28.1 30.8 33.4 33.6 11 Lease financing receivables 5.8 7.4 9.5 10.7 10.8 5.8 7.4 9.5 10.7 10.8 12 All other loans 29.5 43.63 42.6 52.2 56.3 31.5 46.63 45.9 51.0 55.7 Memo; 13 Total loans and securities plus loans sold2'9 895.9 1,018.I3 1,135.34-8 1,179.1 1,194.1 903.9 1,027.63 1,145.74-8 1,178.7 1,195.8 14 Total loans plus loans sold2-9 636.9 751.63 850.004-8 867.7 879.7 643.0 759.23 858.44-8 869.9 883.2 15 Total loans sold to affiliates9 4.8 3.8 2.8« 2.9 2.9 4.8 3.8 2.88 2.9 2.9 16 Commercial and industrial loans plus loans sold9 213.95 248.56-'0 292.3 4-8 303.2 309.4 215.35 250.16-10 294.24-8 302.9 309.2 17 Commercial and industrial loans sold9 .. 2.7 1.9") 1.8« 1.9 1.9 2.7 1.91° 1.88 1.9 1.9 18 Acceptances held 7.5 6.8 8.5 9.3 8.9 8.6 7.5 9.4 8.6 8.2 19 Other commercial and industrial loans .. 203.75 239.7 282.0 291.9' 298.5 203.95 240.9 283.1 292.4 299.1 20 To U.S. addressees11 193.85 226.6 263.2 271.8' 277.9 193.75 226.5 263.2 272.3' 278.3 21 To non-U.S. addressees 9.95 13.1 18.8 20.1 20.7 10.35 14.4 19.8 20.1 20.8 22 Loans to foreign banks 13.5 21.2 18.7 21.9' 23.5 14.6 23.0 20.1 21.6' 23.1 23 Loans to commercial banks in the United States 54.1 57.3 77.8 102.9 97.8 56.9 60.3 81.9 96.3 94.7 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, nontions. 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 $0.2 billion and nonbank financial loans $0.1 billion; real estate loans were increased $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 Nonfinancial Statistics • November 1980 1.24 MAJOR NONDEPOSIT FUNDS OF COMMERCIAL BANKS' Monthly averages, billions of dollars December outstanding Outstanding in 1980 SSoouurrccee 1976 1977 1978 Jan. Feb. Mar. Apr. May June July Aug. Sept. Total nondeposit funds 1 Seasonally adjusted2 54.7 61.8 85.4 122.5 129.2 133.4 124.2 120.0 113.6 113.6 111.0 112.3 2 Not seasonally adjusted 53.3 60.4 84.4 121.2 125.9 130.4 121.1 123.2 113.7' 117.7 113.9 112.8 Federal funds, RPs, and other borrowings from nonbanks 3 Seasonally adjusted3 47.1 58.4 74.8 92.0 97.2 97.9 94.7 94.2 96.1 100.1 99.1 103.5 4 Not seasonally adjusted 45.8 57.0 73.8 90.6 93.9 94.8 91.7 97.4 96.2 104.2 102.1 104.0 5 Net Eurodollar borrowings, not seasonally adjusted ... 3.7 -1.3 6.8 27.9 29.4 32.9 26.8 23.2 14.7' 10.7 8.9 5.9 6 Loans sold to affiliates, not seasonally adjusted4-5 3.8 4.8 3.8 2.7 2.6 2.6 2.6 2.6 2.8 2.8 2.9 2.9 MEMO 7 Domestic chartered banks net positions with own foreign branches, not seasonally adjusted6 -6.0 -12.5 - 10.2 5.9 6.6 9.3 6.0 2.7 -5.2 -8.1 -9.9 -14.1 8 Gross due from balances 12.8 21.1 24.9 23.0 23.4 23.6 24.4 27.3 29.9 32.4 35.3 37.6 9 Gross due to balances 6.8 8.6 14.7 28.9 29.8 32.9 30.4 30.0 24.7 24.3 25.4 23.5 10 Foreign-related institutions net positions with directly related institutions, not seasonally adjusted7 9.7 11.1 17.0 22.0 22.8 23.6 20.9 20.5 19.9 18.8 18.9 19.9 11 Gross due from balances 8.3 10.3 14.2 29.6 30.4 . 31.9 28.5 28.4 28.5 30.6 30.7 31.6 12 Gross due to balances 18.1 21.4 31.2 51.6 53.2 55.6 49.4 48.8 48.4 49.4 49.6 51.6 13 Security RP borrowings, seasonally adjusted8 27.9 36.3 44.8 51.0 49.5 45.0 41.5 40.1 45.0 50.4 52.7 51.4 14 Not seasonally adjusted 27.0 35.1 43.6 48.3 48.2 44.1 40.6 42.1 44.7 50.2 54.2 53.7 15 U.S. Treasury demand balances, seasonally adjusted9 . 3.9 4.4 8.7 12.7 11.3 7.5 8.6 9.4 8.6 10.7 11.6 12.5 16 Not seasonally adjusted 4.4 5.1 10.3 12.7 11.7 7.8 9.0 8.4 10.0 9.2 9.1 14.1 17 Time deposits, $100,000 or more, seasonally adjusted10 137.7 162.0 213.0 229.1 235.6 237.1 240.3 242.0 237.0 233.1 233.4 237.8 18 Not seasonally adjusted 140.0 165.4 217.9 233.0 236.8 239.2 238.4 240.1 234.9 229.2 231.1' 235.6 1. Commercial banks are those in the 50 states and the District of Columbia 4. Loans initially booked by the bank and later sold to affiliates that are still with national or state charters plus U.S. branches, agencies, and New York in- held by affiliates. Averages of Wednesday data. vestment company subsidiaries of foreign banks and Edge Act corporations. 5. As of Dec. 1. 1979. loans sold to affiliates were reduced $800 million due to 2. Includes seasonally adjusted federal funds. RPs, and other borrowings from corrections of two New York City banks. nonbanks and not seasonally adjusted net Eurodollars and loans to affiliates. 6. Includes averages of daily figures for member banks and quarterly call report Includes averages of Wednesday data for domestic chartered banks and averages figures for nonmember banks. of current and previous month-end data for foreign-related institutions. 7. Includes averages of current and previous month-end data until August 1979; 3. Other borrowings are borrowings on any instrument, such as a promissory beginning September 1979 averages of daily data. note or due bill, given for the purpose of borrowing money for the banking business. 8. Based on daily average data reported by 122 large banks beginning February This includes borrowings from Federal Reserve Banks and from foreign banks, 1980 and 46 banks "before February 1980. term federal funds, overdrawn due from bank balances, loan RPs. and partici- 9. Includes U.S. Treasury demand deposits and Treasury tax-and-loan notes at pations in pooled loans. Includes averages of daily figures for member banks and commercial banks. Averages of daily data. averages of current and previous month-end data for foreign-related institutions. 10. Averages of Wednesday figures. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A17 1.25 ASSETS AND LIABILITIES OF COMMERCIAL BANKING INSTITUTIONS Last-Wednesday-of-Month Series Billions of dollars except for number of banks 1979 1980 Account Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. DOMESTICALLY CHARTERED COMMERCIAL BANKS1 1 Loans and investments 1.143.3 1,133.4 1,143.6 1.142.8 1,151.9 1.150.5 1,153.2 1,158.3 1.172.5 1,182.1 1,199.2 2 Loans, gross 860.1 849.7 857.0 854.6 861.2 857.1 857.0 857.4 866.9 873.9 886.4 3 Interbank 62.9 57.2 58.0 55.6 62.4 67.4 66.6 66.8 67.8 67.0 66.9 4 Commercial and industrial 253.4 252.6 256.2 258.3 259.2 256.0 256.8 256.4 258.7 262.9 268.2 5 Other 543.7 540.0 542.9 540.7 539.6 533.7 533.6 534.1 540.3 543.9 551.3 6 U.S. Treasury securities 92.5 92.4 93.6 94.2 93.5 93.9 95.2 97.6 100.3 102.1 103.3 7 Other securities 190.7 191.2 192.9 193.9 197.2 199.5 201.0 203.3 205.3 206.1 209.4 8 Cash assets, total 146.4 148.4 149.9 153.8 168.2 172.4 150.4 154.1 148.7 156.6 156.0 9 Currency and coin 17.9 17.3 17.1 16.8 16.8 17.8 17.4 17.7 18.4 18.0 18.5 10 Reserves with Federal Reserve Banks 28.4 28.3 30.7 34.2 33.2 37.9 29.5 32.1 28.9 31.2 31.6 11 Balances with depository institutions 37.7 43.7 43.4 43.1 49.7 47.9 45.4 44.7 45.6 46.6 47.0 12 Cash items in process of collection .. 62.4 59.0 58.7 59.8 68.6 68.9 58.0 59.6 55.8 60.9 58.8 13 Other assets 61.2 63.1 65.0 66.1 73.3 72.7 77.4 77.0 82.6 87.6 88.0 14 Total assets/total liabilities and capital . 1,351.0 1,344.9 1,358.4 1,362.7 1,393.5 1,395.7 1,381.0 1,389.4 1,403.8 1,426.3 1,4 43.2 15 Deposits 1.030.6 1,022.5 1,028.9 1.032.1 1,060.0 1.057.3 1,044.7 1.050.1 1.059.5 1,074.9 1,091.1 16 Demand 377.6 362.4 358.7 354.5 377.4 370.2 358.0 363.6 363.4 370.0 376.3 17 Savings 203.4 200.6 199.9 196.5 189.3 192.3 197.8 205.7 208.7 209.4 211.4 18 Time 449.7 459.6 470.3 481.1 493.4 494.8 488.9 480.8 487.4 495.5 503.5 19 Borrowings 140.5 143.1 145.1 142.1 147.0 154.1 152.5 158.6 160.1 165.3 163.4 20 Other liabilities 74.1 77.5 81.6 84.2 81.2 78.5 76.6 74.8 76.2 76.4 75.6 21 Residual (assets less liabilities) 105.8 101.8 102.9 104.2 105.2 105.7 107.1 106.0 108.0 109.6 113.1 MEMO: 22 U.S. Treasury note balances included in borrowing 12.8 15.0 8.1 9.4 14.3 5.1 13.1 7.6 8.7 15.2 11.5 23 Number of banks 14,610 14.594 14,609 14.626 14,629 14,639 14,646 14,658 14.666 14,678 14,760 ALL COMMERCIAL BANKING INSTITUTIONS2 24 Loans and investments 1.229.8 1.217.7 1,230.8 1.231.8 1,240.9 1,239.2 1,241.9 1,279.6 25 Loans, gross 943.1 930.7 941.0 940.2 946.8 942.4 942.2 964.2 26 Interbank 80.5 75.4 78.3 75.2 82.1 88.0 84.8 87.2 27 Commercial and industrial 295.0 295.1 298.5 301.7 302.0 298.1 297.8 307.1 28 Other 567.6 560.1 564.2 563.4 562.7 556.2 559.6 573.1 29 U.S. Treasury securities 94.5 94.3 95.5 96.2 95.5 95.9 97.2 104.5 30 Other securities 192.2 192.7 194.4 195.4 198.6 201.0 202.4 207.7 31 Cash assets, total 169.5 166.5 168.8 174.0 187.3 190.7 172.0 179.8 32 Currency and coin 17.9 17.3 17.1 16.8 16.8 17.8 17.4 18.0 33 Reserves with Federal Reserve Banks 29.0 28.9 31.3 35.0 33.9 38.7 30.3 31.7 34 Balances with depository institutions 59.0 59.8 60.5 61.1 66.6 -63.8 64.6 n .a. n. a. 67.6 n .a. 35 Cash items in process of collection .. 63.7 60.4 60.0 61.2 69.9 70.4 59.7 62.5 36 Other assets 81.0 83.7 86.8 91.6 99.0 98.1 105.5 117.2 37 Total assets/total liabilities and capital . 1,480.3 1,468.0 1,486.5 1,497.5 1,527.2 1,528.0 1,519.4 1,576.6 38 Deposits 1,076.3 1,063.1 1,070.0 1,073.5 1,101.1 1,097.1 1,088.7 1,122.2 39 Demand 400.5 380.5 376.8 373.6 396.6 387.7 379.1 391.2 40 Savings 204.3 201.3 200.3 196.7 189.5 192.6 198.2 209.8 41 Time 471.5 481.3 492.9 503.2 515.0 516.9 511.4 521.2 42 Borrowings 180.5 179.5 182.9 186.5 190.8 196.3 197.9 212.6 43 Other liabilities 115.4 121.1 128.4 130.9 127.8 126.6 124.1 130.6 44 Residual (assets less liabilities) 108.1 104.2 105.2 106.5 107.4 108.1 108.7 111.2 MEMO: 45 U.S. Treasury note balances included in borrowing 12.8 15.0 8.1 9.4 14.3 5.1 13.1 15.2 46 Number of banks 14,975 14,962 14,978 14.995 15,004 15,016 15,019 15,069 1. Domestically chartered commercial banks include an 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

A18 Domestic Nonfinancial Statistics • November 1980 1.26 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 AAccccoouunntt Sept. 3 Sept. 10 Sept. 17 Sept. 24 Oct. IP Oct. 8P Oct. 15 P Oct. IIP Oct. 29P 1 Cash items in process of collection 57,750 50,630 53,741 50,643 57,586 50,163 65,802 51,492 48,469 2 Demand deposits due from banks in the United States 18,145 18,136 18,853 18,756 21,347 20,337 21,311 19,183 17,176 3 All other cash and due from depository institutions 29,657 30,276 31,046 33,012 33,389 27,733 30,263 33,466 34,813 4 Total loans and securities 530,256 529,429 528,071 525,544 536,955 535,690 537,879 530,954 534,260 Securities 5 U.S. Treasury securities 40,283 39,252 39,250 38,317 38,706 37,966 38,308 37,972 37,679 6 Trading account 5,450 4,734 4,865 4,030 4,324 4,241 4,388 4,191 3,777 7 Investment account, by maturity 34,833 34,518 34,385 34,286 34,382 33,725 33,920 33,781 33,902 8 One year or less 7,723 7,529 7,690 7,728 8,068 7,959 8,288 8,396 8,584 9 Over one through five years 23,320 23,312 23,080 22,908 22,731 22,295 22,157 21,944 21,929 10 Over five years 3,790 3,677 3,616 3,650 3,583 3,470 3,476 3,441 3,389 11 Other securities 75,568 76,328 75,642 75,638 76,173 71,091 76,553 76,539 76,561 12 Trading account 2,822 3,470 2,658 2,592 2,810 3,390 2,869 2,984 2,942 13 Investment account 72,747 72,858 72,984 73,047 73,362 73,707 73,684 73,554 73,619 14 U.S. government agencies 16,095 15,975 15,928 15,935 16,047 16,066 16,034 15,915 15,973 15 States and political subdivision, by maturity ... 53,947 54,185 54,338 54,425 54,611 54,943 54,932 54,916 54,924 16 One year or less 6,931 7,043 7,176 7,199 7,432 7,415 7,388 7,243 7,296 17 Over one year 47,016 47,141 47,162 47,226 47,178 47,528 47,544 47,674 47,627 18 Other bonds, corporate stocks and securities .. 2,704 2,698 2,717 2,686 2,704 2,698 2,718 2,722 2,722 Loans 19 Federal funds sold1 27,399 27,142 24,616 23,479 26,229 28,093 27,720 22,511 23,883 20 To commercial banks 19,878 19,368 18,479 17,317 20,027 20,605 21,039 15,552 16,649 21 To nonbank brokers and dealers in securities .... 4,752 5,378 3,977 3,993 4,142 5,159 4,725 4,807 4,820 2 2 To others 2,770 2,395 2,160 2,169 2,060 2,329 1,956 2,152 2,414 23 Other loans, gross 399,796 399,541 401,424 401,002 408,566 405,264 408,063 406,751 408,954 24 Commercial and industrial 161,390 162,023 163,168 163,018 166,205 165,550 165,904 165,964 166,208 25 Bankers acceptances and commercial paper ... 4,925 4,720 4,500 4,678 4,971 4,406 4,424 4,280 4,509 76 All other 156,465 157,303 158,668 158,340 161,234 161,144 161,480 161,684 161,698 27 U.S. addressees 150,311 151,099 152,409 152,016 155,034 154,833 155,066 155,336 155,292 28 Non-U.S. addressees 6,154 6,204 6,259 6,325 6,200 6,310 6,414 6,348 6,406 29 Real estate 106,894 107,279 107,673 107,935 108,298 108,444 108,853 109,176 109,456 30 To individuals for personal expenditures 71,054 70,988 71,121 71,163 71,228 71,084 71,024 71,028 71,124 To financial institutions 31 Commercial banks in the United States 4,190 3,592 3,843 3,648 4,146 3,673 4,007 3,633 3,614 32 Banks in foreign countries 7,481 7,252 7,299 7,230 7,778 7,314 8,449 7,966 8,118 33 Sales finance, personal finance companies, etc . 8,190 8,378 8,322 8,338 8,604 8,498 8,916 8,991 8,912 34 Other financial institutions 15,272 15,495 15,396 15,162 15,674 15,416 15,311 15,111 15,112 35 To nonbank brokers and dealers in securities 4,869 4,654 4,604 4,676 5,532 4,968 5,391 4,593 4,938 36 To others for purchasing and carrying securities2 2,055 2,086 2,104 2,108 2,112 2,103 2,113 2,109 2,145 37 To finance agricultural production 5,428 5,401 5,404 5,423 5,436 5,459 5,403 5,529 5,484 38 All other 12,974 12,393 12,489 12,300 13,552 12,754 12,693 12,651 13,843 39 LESS: Unearned income 7,111 7,134 7,155 7,212 7,082 7,096 7,104 7,139 7,164 40 Loan loss reserve 5,680 5,699 5,707 5,679 5,636 5,633 5,660 5,679 5,654 41 Other loans, net 387,005 386,708 388,562 388,110 395,847 392,534 395,298 393,932 396,136 42 Lease financing receivables 8,836 8,844 8,900 8,918 8,946 8,946 9,001 8,991 9,043 43 All other assets 82,229 83,099 82,552 83,547 84,093 83,339 81,376 78,796 78,962 44 Total assets 726,873 720,415 723,163 720,420 742,316 726,208 745,633 722,883 722,724 Deposits 45 Demand deposits 204,290 196,842 200,755 190,743 208,608 197,809 221,552 194,085 191,804 46 Mutual savings banks 809 708 751 589 863 790 965 607 622 47 Individuals, partnerships, and corporations 142,783 139,793 141,962 132,627 145,288 138,494 150,662 136,323 135,215 48 States and political subdivisions 4,887 4,476 4,835 4,787 5,135 4,850 5,550 4,794 4,663 49 U.S. government 1,015 1,862 1,406 1,318 1,030 858 1,790 742 789 50 Commercial banks in the United States 36,559 33,493 34,229 34,909 37,536 35,951 42,878 33,955 34,460 51 Banks in foreign countries 8,408 7,477 7,707 7,804 7,922 7,886 8,602 7,900 7,610 52 Foreign governments and official institutions 1,633 1,639 1,097 1,008 1,376 1,395 1,628 1,439 1,292 53 Certified and officers' checks 8,196 7,394 8,769 7,703 9,457 7,585 9,476 8,325 7,153 54 Time and savings deposits 281,420 282,447 282,464 284,684 285,113 287,028 285,683 286,789 289,370 55 Savings 75,905 75,880 76,041 75,305 76,664 76,556 76,449 76,241 76,031 56 Individuals and nonprofit organizations 71,145 71,102 71,306 70,578 71,733 71,711 71,596 71,425 71,205 57 Partnerships and corporations operated for profit 4,116 4,121 4,062 4,074 4,079 4,106 4,053 4,103 4,170 58 Domestic governmental units 628 642 658 636 835 720 784 694 636 59 All other 17 15 16 17 16 19 17 18 20 60 Time 205,515 206,567 206,422 209,379 208,449 210,472 209,234 210,548 213,339 61 Individuals, partnerships, and corporations 174,167 175,219 175,095 177,713 177,063 178,748 177,529 178,429 181,149 62 States and political subdivisions 19,428 19,189 19,165 19,237 19,118 19,366 19,366 19,579 19,575 63 U.S. government 348 353 314 323 296 315 322 315 315 64 Commercial banks in the United States 5,645 5,550 5,547 5,715 5,640 5,638 5,646 5,743 5,791 65 Foreign governments, official institutions, and banks 5,925 6,256 6,301 6,392 6,332 6,404 6,372 6,482 6,508 Liabilities for borrowed money 66 Borrowings from Federal Reserve Banks 757 934 452 3,337 2,791 274 275 3,499 2,102 67 Treasury tax-and-loan notes 5,770 2,315 7,084 11,486 12,740 4,480 5,628 6,901 7,952 68 All other liabilities for borrowed money3 125,071 128,318 123,663 120,614 123,240 128,848 124,518 122,586 122,588 69 Other liabilities and subordinated notes and debentures 60,920 60,858 60,290 60,872 60,551 58,359 58,921 59,978 59,710 70 Total liabilities 678,228 671,714 674,709 671,736 693,043 676,799 696,577 673,838 673,526 71 Residual (total assets minus total liabilities)4 48,644 48,701 48,454 48,684 49,272 49,409 49,056 49,045 49,198 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 Digitized for FRAreSpuErRch ase; for information on these liabilities at banks with assets of $1 billion or more on Dec. 31, 1977, see table 1.13. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Banks A19 1.27 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 1980 AAccccoouunntt Sept. 3 Sept. 10 Sept. 17 Sept. 24 Oct. 1/' Oct. 8P Oct. 15/' Oct. 22P Oct. 29P 1 Cash items in process of collection 54.625 48.170 51.056 48.070 54.785 47,711 62.230 48.943 46,263 2 Demand deposits due from banks in the United States .. 17.255 17.419 18.230 18.206 20.648 19.703 20.408 18.580 16,674 3 All other cash and due from depository institutions 27.853 28.396 28.870 30.743 31.079 25.911 27.977 30.977 32,411 4 Total loans and securities 494,303 493,304 492,030 489,924 500,730 499,116 501,268 494,987 497,993 Securities 5 U.S. Treasury securities 37.604 36,605 36.562 35.644 35.982 35,264 35.588 35,299 35,001 6 Trading account 5.394 4.690 4.815 3.988 4.268 4,202 4,284 4.127 3,714 7 Investment account, by maturity 32.210 31.915 31.747 31.656 31.714 31,062 31.304 31.172 31,287 8 One year or less 7.202 7,018 7.164 7.184 7.536 7,441 7,770 7.874 8,057 9 Over one through five years 21.593 21.592 21.340 21.192 20,971 20,527 20,434 20,233 20,205 10 Over five years 3.414 3.305 3.244 3.279 3.207 3,094 3,100 3,065 3,025 11 Other securities 69.337 70.067 69.369 69.372 69,871 70,801 70.260 70,210 70,206 12 Trading account 2.730 3,382 2.562 2.506 2.710 3,320 2,805 2,921 2,853 13 Investment account 66,607 66.684 66.807 66.866 67.161 67,481 67.455 67,290 67,353 14 U.S. government agencies 14.919 14.794 14,747 14.759 14.863 14.873 14.838 14,714 14,769 15 States and political subdivision, by maturity 49.154 49.363 49,512 49.591 49,763 50,081 50.069 50,024 50,033 16 One year or less 6.230 6.341 6.479 6.498 6,706 6,683 6.657 6.479 6,536 17 Over one year 42,924 43.022 43,034 43.094 43,058 43.398 43.412 43,545 43,496 18 Other bonds, corporate stocks and securities 2,534 2.528 2.548 2.516 2,534 2,527 2.548 2.551 2,551 Loans 19 Federal funds sold1 24.171 23.715 21.386 20.661 23,054 24,500 24,194 19,627 20,791 20 To commercial banks 17,017 16.350 15,606 14.834 17,140 17,485 17.907 13,044 13,910 21 To nonbank brokers and dealers in securities 4.399 4.989 3.651 3.683 3.874 4,712 4.358 4.462 4,507 22 To others 2,755 2.376 2,129 2.144 2.040 2,303 1.929 2,122 2,374 23 Other loans, gross 375.034 374.799 376.620 376.186 383,599 380,332 383,043 381.725 383,874 24 Commercial and industrial 153.196 153.757 154.849 154.692 157,796 157,083 157.445 157.440 157,669 25 Bankers acceptances and commercial paper 4.783 4.532 4.310 4.497 4.809 4,229 4.215 4.060 4,301 26 All other 148.412 149.225 150.539 150.194 152,988 152.854 153,231 153.380 153,368 27 U.S. addressees 142.323 143.085 144,345 143.932 146.853 146,607 146,881 147,100 147,027 28 Non-U.S. addressees 6,089 6,140 6.194 6.262 6,135 6,246 6,350 6,280 6,341 29 Real estate 100.658 101.033 101.422 101.688 102,057 102.209 102,591 102,894 103,161 30 To individuals for personal expenditures 62.707 62.643 62,769 62.811 62.872 62,742 62,675 62,672 62,761 To financial institutions 31 Commercial banks in the United States 4.097 3.493 3,733 3.536 4.026 3,560 3.880 3,510 3,495 32 Banks in foreign countries 7,341 7.130 7.237 7.162 7.703 7.229 8,353 7,891 8,047 33 Sales finance, personal finance companies, etc 7.997 8.199 8,131 8.155 8,422 8.330 8,747 8.827 8,741 34 Other financial institutions 14.861 15,078 14.984 14,754 15.264 15,012 14,902 14.714 14,715 35 To nonbank brokers and dealers in securities 4.800 4,597 4.534 4.594 5,460 4.890 5,322 4,531 4,861 36 To others for purchasing and carrying securities2 1,835 1.861 1.876 1.878 1.881 1,870 1.880 1,872 1,900 37 To finance agricultural production 5,262 5.235 5,240 5.260 5.270 5,296 5.236 5,364 5,321 38 All other 12,280 11.773 11,848 11.656 12.846 12.110 12,013 12,010 13,202 39 LESS: Unearned income RR 6,494 6.514 6.533 6.585 6.465 6,478 6,484 6,516 6,544 40 Loan loss reserve 5.350 5.368 5.376 5.354 5.310 5,304 5.333 5,359 5,334 41 Other loans, net 363.190 362,917 364.712 364.247 371,823 368.551 371,226 369,851 371,995 42 Lease financing receivables 8.583 8.592 8,648 8.667 8,690 8.691 8,743 8,732 8,784 43 All other assets 80.007 80.919 80.309 81,309 81,733 81.074 79,226 76.603 76,694 44 Total assets 682,626 676,801 679,142 676,919 697,666 682,206 699,853 678,822 678,819 Deposits 45 Demand deposits 191,333 184.861 188.299 178.904 195.768 185.648 207,940 181.950 179,972 46 Mutual savings banks 770 678 720 565 825 754 932 580 594 47 Individuals, partnerships, and corporations 132,626 130.250 132.152 123.367 135.153 128,751 139,982 126,755 125,728 48 States and political subdivisions 4.327 3.963 4.240 4.173 4,551 4.326 4,902 4.052 4,092 49 U.S. government 912 1.668 1.153 1.020 934 769 1.609 645 720 50 Commercial banks in the United States 34.862 32.178 32,860 33.620 36,017 34.567 41,206 32.629 33,153 51 Banks in foreign countries 8.315 7.404 7.625 7.721 7.830 7,820 8.535 7.839 7,551 . 52 Foreign governments and official institutions 1.631 1.634 1.093 1.004 1,371 1,390 1,625 1.436 1,291 53 Certified and officers' checks 7.890 7.085 8,455 7.434 9,088 7,270 9,149 8,015 6,842 54 Time and savings deposits 261.768 262.691 262.746 264.895 265,358 267,073 265,612 266,736 269,317 55 Savings 70.158 70,133 70.286 69.610 70.892 70.774 70,651 70,503 70,322 56 Individuals and nonprofit organizations 65.773 65.732 65.928 65.247 66.333 66.305 66,203 66,059 65,864 57 Partnerships and corporations operated for profit ... 3.805 3.811 3.759 3.769 3.774 3,799 3.752 3.796 3,856 58 Domestic governmental units 562 574 584 577 769 651 680 629 582 59 All other 17 15 16 17 16 18 17 18 20 60 Time 191.610 192.557 192.460 195.286 194.466 196,300 194.961 196.233 198,994 61 Individuals, partnerships, and corporations 162.369 163,287 163.192 165.748 165.191 166,704 165.380 166.250 168,905 62 States and political subdivisions 17,539 17.327 17.321 17.343 17.245 17.488 17.496 17,702 17,724 63 U.S. government 333 338 299 308 281 301 307 300 300 64 Commercial banks in the United States 5.443 5.349 5.347 5.495 5,416 5.401 5,406 5.500 5,558 65 Foreign governments, official institutions, and banks 5.925 6.256 6,301 6.392 6,332 6.404 6,372 6.482 6,508 Liabilities for borrowed money 66 Borrowings from Federal Reserve Banks 757 934 449 3.156 2,700 248 142 3.365 2,065 67 Treasury tax-and-loan notes 5,303 2.114 6,623 10.688 11,829 4.144 5.231 6.359 7,363 68 All other liabilities for borrowed money3 118.525 121.294 116.937 114.339 116,927 121,882 117.548 115.963 115,858 69 Other liabilities and subordinated notes and debentures 59.480 59,429 58.840 59.467 59.044 57,032 57.552 58,604 58,273 70 Total liabilities 637,167 631,323 633,895 631,450 651,627 636,028 654,026 632,978 632,847 71 Residual (total assets minus total liabilities)4 45.459 45,478 45,247 45.470 46,039 46.179 45.826 45.844 45,972 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

A20 Domestic Nonfinancial Statistics • November 1980 1.28 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1980 AAccccoouunntt Sept. 3 Sept. 10 Sept. 17 Sept. 24 Oct. \P Oct. 8/' Oct. 15/' Oct. HP Oct. 29P 1 Cash items in process of collection 18,050 17.869 19,671 20.312 21,691 18.886 23.370 19,743 18.340 2 Demand deposits due from banks in the United States .. 11.485 12.370 12.432 13.422 15.161 14.791 13.692 13,798 11,930 3 All other cash and due from depository institutions 6,930 7.342 7.464 8.382 9.494 7.113 7.103 9.130 9,004 4 Total loans and securities1 118,484 117,137 116,128 115,592 118,737 118,370 120,262 117,477 120,225 Securities 7 Investment account, by maturity 8.793 8.672 8.641 8.606 8.624 8.206 8.267 8.026 8,105 8 One year or less 1,071 1.040 1.160 1.160 1.345 1.150 1.286 1.216 1.306 9 Over one through five years 7.095 7.085 6.933 6.908 6.739 6,522 6.438 6.271 6.261 10 Over five years 626 548 548 538 539 533 543 538 538 13 Investment account 13.572 13.637 13.658 13.670 13.733 13.821 13.823 13,845 13,816 14 U.S. government agencies 2.456 2.456 2.435 2.428 2,413 2.408 2.393 2.383 2,392 15 States and political subdivision, by maturity 10.525 10,590 10.631 10.672 10.747 10.840 10,844 10,878 10,835 16 One year or less 1.8(H) 1,835 1.889 1.872 1.966 1.886 1.913 1.828 1,798 17 Over one year 8.725 8.755 8.742 8.800 8.781 8.954 8,931 9.050 9,037 18 Other bonds, corporate stocks and securities 592 590 591 569 573 573 587 584 588 Loans 19 Federal funds sold3 8.163 7.192 6.188 5.924 6.150 6.948 7.415 6.135 7,112 20 To commercial banks 4.652 3.612 3.149 3.006 3.323 4.026 4,244 2.591 3.372 21 To nonbank brokers and dealers in securities 2.010 2,100 1.787 1.655 1.780 1.883 2.056 2.106 2,134 22 To others 1.501 1,481 1.251 1.262 1.047 1.039 1.114 1.438 1.604 23 Other loans, gross 90,801 90,493 90.507 90.286 93.081 92.237 93.630 92.369 94,088 24 Commercial and industrial 48,124 48,234 48.295 47.926 49.272 48.816 48.900 48.405 48,565 25 Bankers acceptances and commercial paper 1,699 1.461 1.265 1.350 1.377 970 878 828 851 26 All other 46.425 46.773 47.030 46.577 47.895 47.846 48.022 47.577 47.714 27 U.S. addressees 44.396 44.698 44.950 44.497 45.912 45.817 45.880 45.501 45.600 28 Non-U.S. addressees 2.028 2.075 2.079 2.080 1,983 2.029 2.142 2.076 2,114 29 Real estate 13.752 13.837 13.953 14.008 14.067 14.075 14.174 14.252 14,353 30 To individuals for personal expenditures 8,975 8.985 9.005 9.012 8,988 8.996 9,020 9.010 9,023 To financial institutions 31 Commercial banks in the United States 1.412 1.014 1.176 1.233 1.362 1.412 1,492 1.284 1,241 32 Banks in foreign countries 3.235 3.269 3.286 3.238 3.680 3.231 4.167 3.831 4,026 33 Sales finance, personal finance companies, etc 3.276 3.430 3.268 3.391 3.525 3,540 3.810 3.820 3,825 34 Other financial institutions 4.479 4.576 4.563 4.463 4.636 4.505 4.470 4.409 4,377 35 To nonbank brokers and dealers in securities 3.034 2.827 2,840 2.789 3.070 3.074 3.339 2.732 3,020 36 To others for purchasing and carrying securities4 362 368 370 373 382 381 393 392 411 37 To finance agricultural production 434 404 409 416 443 448 445 546 542 38 All other 3.716 3.547 3.343 3.435 3.656 3.759 3.420 3.687 4,705 39 LESS: Unearned income 1.074 1.072 1.078 1.112 1.099 1.092 1.093 1.118 1.129 40 Loan loss reserve 1.771 1.786 1.787 1.782 1.752 1.749 1.781 1.780 1.767 41 Other loans, net 87.956 87.635 87.642 87.392 90.230 89.396 90.756 89.471 91,192 42 Lease financing receivables 1.692 1.693 1.713 1.713 1.720 1.720 1.728 1.723 1,723 43 All other assets5 34.204 34.620 33.198 33.125 33.702 34.047 33.012 30.821 30,159 44 Total assets 190,845 191,031 190,606 192,545 200,505 194,928 199,167 192,692 191,381 Deposits 45 Demand deposits 63.093 63,291 64.994 64.631 69,476 65.723 74.007 64,628 62.848 46 Mutual savings banks 366 364 366 292 480 407 463 277 292 47 Individuals, partnerships, and corporations 32.197 32,705 33.506 31.180 34.862 32.532 34.877 31,920 31,478 48 States and political subdivisions 429 420 440 462 597 676 929 456 455 49 U.S. government 148 409 372 222 137 130 338 122 134 50 Commercial banks in the United States 18.738 19,203 19.366 21,958 21.752 21.641 24,632 20.276 20,470 51 Banks in foreign countries 6.458 5,716 5.948 6.061 6.154 6.147 6.891 6,177 5,860 52 Foreign governments and official institutions 1,307 1.327 798 740 1.092 1.045 1.290 1.154 1,037 53 Certified and officers' checks 3.450 3.146 4.196 3.716 4.401 3.144 4.586 4.245 3,122 54 Time and savings deposits 48.892 49.242 49.120 49.406 49.856 50.277 49.678 49.783 51,138 55 Savings 9.889 9.899 9.946 9.776 9.967 10,041 10,042 9.976 9,894 56 Individuals and nonprofit organizations 9.429 9.428 9.472 9.307 9.479 9.536 9,515 9.483 9.411 57 Partnerships and corporations operated for profit ... 354 354 351 343 345 346 339 343 346 58 Domestic governmental units 101 114 119 123 139 155 184 146 132 59 All other 4 3 3 4 4 4 4 4 4 60 Time 39,004 39.343 39.174 39.630 39.889 40,237 39.636 39.808 41,243 61 Individuals, partnerships, and corporations 32.711 32.880 32.777 33.089 33.441 33,674 33.059 33.030 34,490 62 States and political subdivisions 1.548 1.517 1.487 1.518 1.496 1.585 1.624 1,742 1,794 63 U.S. government 26 24 23 23 22 21 22 24 26 64 Commercial banks in the United States 1.959 2.002 2.020 2.073 2.040 2,038 2.039 2,132 2,046 65 Foreign governments, official institutions, and banks 2.760 2.920 2.868 2.927 2,890 2.919 2,891 2.879 2,888 Liabilities for borrowed money 66 Borrowings from Federal Reserve Banks 430 390 1.075 1.232 1,417 500 67 Treasury tax-and-loan notes 1.291 487 2.016 2.940 2.939 1.018 1,393 1.668 1,955 68 All other liabilities for borrowed money6 38.109 39.124 36.550 36.319 38.186 39,649 35.622 36.366 36,516 69 Other liabilities and subordinated notes and debentures . 24.034 23.448 22.974 23.106 23.397 22.889 23.260 23,628 23,218 70 Total liabilities 175,850 175,983 175,654 177,477 185,086 179,556 183,960 177,491 176,175 71 Residual (total assets minus total liabilities)4 14.995 15,048 14.952 15.068 15.419 15.372 15.206 15.201 15,206 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 A21 1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS Balance Sheet Memoranda Millions of dollars, Wednesday figures 1980 AAccccoouunntt Sept. 3 Sept. 10 Sept. 17 Sept. 24 Oct. IP Oct. 8p Oct. 15P Oct. 22p Oct. 29p BANKS WITH ASSETS OF $750 MILLION OR MORE 1 Total loans (gross} and securities adjusted1 518,979 519,302 518,611 517,471 525,500 524,141 525,598 524,587 526,814 2 Total loans (gross) adjusted1 403,128 403,722 403,718 403,516 410,622 409,078 410,737 410,077 412,574 3 Demand deposits adjusted2 108,966 110,858 111,379 103,874 112,455 110,838 111,082 107,896 108,086 4 Time deposits in accounts of $100,000 or more 131,160 131,933 132,078 134,313 134,411 135,021 133,688 134,989 138,026 5 Negotiable CDs 94,432 95,051 95,030 97,043 97,294 97,359 95,917 96,607 99,381 6 Other time deposits 36,728 36,882 37,049 37,269 37,117 37,661 37,770 38,382 38,645 7 Loans sold outright to affiliates3 2,917 2,903 2,931 2,900 2,949 2,868 2,775 2,732 2,633 8 Commercial and industrial 1,908 1,910 1,935 1,905 1,948 1,848 1,753 1,811 1,760 9 Other 1,009 993 995 995 1,001 1,020 1,022 921 873 BANKS WITH ASSETS OF $1 BILLION OR MORE 10 Total loans (gross} and securities adjusted1 485,033 485,343 484,599 483,493 491,340 489,853 491,298 490,308 492,466 11 Total loans (gross) adjusted1 378,091 378,671 378,668 378,476 385,488 383,788 385,450 384,798 387,260 12 Demand dejx>sits adjusted2 100,934 102,844 103,230 96,193 104,032 102,600 102,895 99,734 99,836 13 Time deposits in accounts of $100,000 or more 123,181 123,861 124,050 126,195 126,332 126,848 125,433 126,709 129,689 14 Negotiable CDs 88,748 89,304 89,300 91,243 91,509 91,502 89,964 90,637 93,380 15 Other time deposits 34,433 34,557 34,749 34,952 34,823 35,345 35,469 36,073 36,308 16 Loans sold outright to affiliates3 2,877 2,860 2,888 2,860 2,907 2,825 2,732 2,688 2,590 17 Commercial and industrial 1,889 1,889 1,914 1,884 1,926 1,826 1,730 1,787 1,736 18 Other 988 972 974 976 981 999 1,002 902 854 BANKS IN NEW YORK CITY 19 Total loans (gross) and securities adjusted14 115,264 115,369 114,668 114,246 116,902 115,774 117,400 116,500 118,508 20 Total loans (gross) adjusted1 92,900 93,060 92,370 91,970 94,546 93,747 95,310 94,629 96,586 21 Demand deposits adjusted2 26,157 25,810 25,585 22,138 25,896 25,066 25,666 24,486 23,903 22 Time deposits in accounts of $100,000 or more 30,270 30,550 30,381 30,752 31,128 31,245 30,632 30,857 32,296 23 Negotiable CDs 22,293 22,500 22,283 22,697 23,132 23,117 22,431 22,520 23,908 24 Other time deposits 7,977 8,050 8,098 8,055 7,996 8,128 8,201 8,337 8,388 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, nonbanks. 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. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 Domestic Nonfinancial Statistics • November 1980 1.30 LARGE WEEKLY REPORTING COMMERCIAL BANKS Domestic Classified Commercial and Industrial Loans Millions of dollars Outstanding Net change during IIInnnddduuussstttrrryyy ccclllaaassssssiiifffiiicccaaatttiiiooonnn 1980 1980 June 25 July 30 Aug. 27 Sept. 24 Oct. 29P 02 03 Aug. Sept. Oct.? 1 Durable goods manufacturing 22,729 22,477 22,965 23,513 23,342 -2,332 784 488 548 -171 2 Nondurable goods manufacturing 18,338 18,532 18,799 19,548 20,135 -1,486 1,210 267 749 587 3 Food, liquor, and tobacco 3,701 3,887 3,897 4,352 4,597 -1,222 651 10 455 245 4 Textiles, apparel, and leather 4,934 5,066 5,230 5,204 5,071 454 269 165 -27 -133 5 Petroleum refining 2,715 2,616 2,694 2,700 2,993 -424 -15 78 5 293 6 Chemicals and rubber 3,704 3,723 3,707 3,733 3,846 -208 30 -16 26 113 7 Other nondurable goods 3,284 3,240 3,270 3,559 3,627 -86 275 30 289 68 8 Mining (including crude petroleum and natural gas) 13,758 13,650 13,560 13,958 14,717 1,162 200 -90 398 760 9 Trade 24,600 24,279 24,737 24,941 26,294 -857 342 458 204 1,352 10 Commodity dealers 1,531 1,670 1,853 2,118 2,471 -285 588 183 266 352 11 Other wholesale 11,679 11,557 11,614 11,589 11,892 -418 -91 57 -25 303 12 Retail 11,389 11,052 11,270 11,234 11,931 -154 -155 219 -36 697 13 Transportation, communication, and other public utilities 18,745 18,996 19,221 19,224 19,323 453 479 225 3 99 14 Transportation 7,600 7,753 7,652 7,736 7,787 83 137 -101 84 51 15 Communication 2,839 2,883 2,918 2,993 3,099 92 154 35 76 106 16 Other public utilities 8,306 8,359 8,651 8,495 8,436 278 188 292 -157 -58 17 Construction 5,970 5,787 5,873 6,031 5,931 96 61 86 158 -100 18 Services 20,296 20,567 20,808 21,315 21,538 86 1,018 241 507 223 19 All other1 14,999 14,964 15,250 15,402 15,745 -656 403 286 152 343 20 Total domestic loans 139,435 139,252 141,214 143,932 147,027 -3,534 4,498 1,962 2,719 3,095 21 MEMO: Term loans (original maturity more than 1 year) included in domestic loans 74,295 73,767 74,976 76,536 77,107 -1,702 2,241 1,209 1,560 571 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. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Deposits and Commercial Paper A23 1.31 GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations' Billions of dollars, estimated daily-average balances Commercial banks TTyyppee ooff hhoollddeerr 19792 1980 11997755 11997766 11997777 11997788 DDeecc.. DDeecc.. DDeecc.. DDeecc.. June Sept. Dec. Mar. June Sept. 1 All holders—Individuals, partnerships, and corporations 236.9 250.1 274.4 294.6 285.6 292.4 302.2 288.4 288.6 302.0 2 Financial business 20.1 22.3 25.0 27.8 25.4 26.7 27.1 28.4 27.7 29.6 3 Nonfinancial business 125.1 130.2 142.9 152.7 145.1 148.8 157.7 144.9 145.3 151.9 4 Consumer 78.0 82.6 91.0 97.4 98.6 99.2 99.2 97.6 97.9 101.8 5 Foreign 2.4 2.7 2.5 2.7 2.8 2.8 3.1 3.1 3.3 3.2 6 Other 11.3 12.4 12.9 14.1 13.7 14.9 15.1 14.4 14.4 15.5 Weekly reporting banks 1979? 1980 11997755 11997766 11997777 11997788 DDeecc.. DDeecc.. DDeecc.. DDeecc.. June Sept. Dec. Mar. June Sept. 7 All holders—Individuals, partnerships, and corporations 124.4 128.5 139.1 147.0 128.8 132.7 139.3 133.6 133.9 140.6 8 Financial business 15.6 17.5 18.5 19.8 18.4 19.7 20.1 20.1 20.2 21.2 9 Nonfinancial business 69.9 69.7 76.3 79.0 68.1 69.1 74.1 69.1 69.2 72.4 10 Consumer 29.9 31.7 34.6 38.2 33.0 33.7 34.3 34.2 33.9 36.0 11 Foreign 2.3 2.6 2.4 2.5 2.7 2.8 3.0 3.0 3.1 3.1 12 Other 6.6 7.1 7.4 7.5 6.6 7.4 7.8 7.2 7.5 7.9 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 estisample 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. 1.32 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING Millions of dollars, end of period 1980 Instrument 1976 1977 1978 1979' Dec. Dec. Dec. Dec. Apr. May June July Aug. Sept. Commercial paper (seasonally adjusted) 1 All issuers 53,010 65.036 83,420 112,803 120,887 121,032 123,937 122,259 122,607r 123,460 Financial companies2 Dealer-placed paper3 2 Total 7,263 8,888 12,300 17,579 18,881 18,526 19,100 18,207 19,092' 19,509 3 Bank-related 1,900 2,132 3,521 2,874 3,467 3,591 3,188 3,198 3,313 33,,337700 DirectIv placed paper4 4 Total ! 32,622 40,612 51,755 64,931 66,110 63,813 62,623 63,777 64,550 65,542 5 Bank-related 5,959 7,102 12,314 17,598 19,166 18,845 19,436 19,239 19,909 19,692 6 Nonfinancial companies5 13,125 15,536 19,365 30,293 35,896 38,693 42,214 40,275 38,965' 38,409 Bankers dollar acceptances (not seasonally adjusted) 7 Total 22,523 25,450 33,700 45,321 50,177 52,636 54,356 54,334 54,486 Holder 8 Accepting banks 10,442 10,434 8,579 9,865 8,159 9,262 10,051 9,764 9,644 9 Own bills 8,769 8,915 7,653 8,327 7,488 8,768 9,113 8,603 8,544 10 Bills bought 1.673 1,519 927 1.538 670 493 939 1,161 1,100 Federal Reserve Banks 11 Own account 991 954 1 704 0 366 373 310 277 n .a. 12 Foreign correspondents 375 362 664 1,382 1,555 1,718 1,784 1,899 1,841 13 Others 10,715 13,700 24,456 33,370 40,463 41,290 42,147 42,361 42,724 Basis 14. Imports into United States 4.992 6,378 8,574 10,270 10,946 11,651 11,536 12,109 11,861 15 Exports from United States 4,818 5,863 7,586 9,640 11,221 11,347 11,339 12,401 12,582 16 All other 12,713 13,209 17,540 25,411 28.010 29,637 31,480 29,824 30,043 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 1979. 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, ana other business lending; insurance underwriting; and communications, construction, manufacturing, mining, wholesale and retail trade, Digitized foro FthRer AinSveEstRm ent activities. transportation, and reserves. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 Domestic Nonfinancial Statistics • November 1980 1.33 PRIME RATE CHARGED BY BANKS on Short-Term Business Loans Percent per annum Effective date Rate Effective Date Rate Month Average rate 1980—May 16 16 Vfc i 1980—Aug 22 11.25 1979—Mar. 11.75 1980—Jan 23 14 27 11.50 Apr. 11.75 Feb 30 14 Sept 8 12.00 May 11.75 Mar June 6 13 12 12.25 June 11.65 Apr 13 12-12'/2 19 12.50 July 11.54 May 20 12 26 13.00 Aug. 11.91 June July 7 1111..0500 Oct 1 13.50 Sept. 12.90 July 25 17 14.00 Oct. 14.39 Aug 29 14.50 Nov. 15.55 Sept Dec. 15.30 Oct 1.34 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, August 4-9, 1980 Size of loan (in thousands of dollars) All Item sizes 1.000 1-24 25-49 50-99 and over SHORT-TERM COMMERCIAL AND INDUSTRIAL LOANS 1 Amount of loans (thousands of dollars) 13.492.779 696.920 501,851 716,033 2,074.691 703.435 8.799,849 2 Number of loans 139.530 98.586 15,075 11.249 11.675 1.133 1,812 3 Weighted-average maturity (months) 2.2 3.0 3.1 3.4 3.5 3.4 1.5 4 Weighted-average interest rate (percent per annum) 11.56 13.65 13.53 13.00 12.49 12.01 10.92 5 Interquartile range1 10.75-12.42 12.42-14.84 12.42-14.66 12.07-13.72 11.60-13.10 11.25-12.41 10.12-11.50 Percentage of amount of loans 6 With floating rate 35.4 22.1 30.9 42.2 39.2 68.5 32.6 7 Made under commitment 46.2 24.7 30.3 35.3 44.6 67.6 48.4 8 With no stated maturity 22.8 14.3 8.5 31.5 20.0 33.0 23.5 LONG-TERM COMMERCIAL AND INDUSTRIAL LOANS 9 Amount of loans (thousands of dollars) 1.806.322 325,437 219,163 113,059 1.148,663 10 Number of loans 24.017 22,299 1.248 174 297 11 Weighted-average maturity (months) 45.9 33.2 55.1 43.9 47.9 12 Weighted-average interest rate (percent per annum) 12.06 14.28 12.57 12.26 11.31 13 Interquartile range1 11.00-12.99 13.00-15.00 11.92-13.24 11.25-13.10 11.00-12.00 Percentage of amount of loans 14 With floating rate 67.8 20.1 59.9 80.9 81.5 15 Made under commitment 72.5 33.7 64.6 75.6 84.7 CONSTRUCTION AND LAND DEVELOPMENT LOANS 16 Amount of loans (thousands of dollars) 1.065.180 161.684 144,638 166,745 318.897 273,217 17 Number of loans 23.363 15.447 3,878 2.608 1,261 169 18 Weighted-average maturity (months) 8.0 15.2 3.4 4.9 5.2 12.0 19 Weighted-average interest rate (percent per annum) 13.16 14.87 13.15 13.13 12.74 12.66 20 Interquartile range1 12.62-13.50 12.68-16.99 12.30-13.28 12.56-13.65 12.56-13.00 12.07-13.00 Percentage of amount of loans 21 With floating rate 40.1 16.8 14.2 19.4 34.2 87.3 22 Secured by real estate 93.9 78.8 98.5 97.9 96.4 95.0 23 Made under commitment 69.8 36.8 75.1 53.2 88.8 74.6 24 With no stated maturity 44.2 75.5 81.1 69.7 21.7 16.7 Type of construction 25 1- to 4-family 8.9 8.0 12.1 1.9 7.4 13.7 26 Multifamily 47.0 16.5 6.8 28.4 70.9 69.6 27 Nonresidential 12.9 8.4 2.5 21.4 6.4 23.5 All 250 sizes 10-24 100-249 and over LOANS TO FARMERS 28 Amount of loans (thousands of dollars) 948.371 145.747 182,288 160.300 130.001 148.329 181,706 29 Number of loans 60.078 38.860.01 12,884 4.751 2.067 1.150 425 30 Weighted-average maturity (months) 7.8 7.1 6.9 12.1 5.6 9.6 31 Weighted-average interest rate (percent per annum) 13.51 13.50 13.44 13.57 13.54 13.77 13.28 32 Interquartile range1 12.89-14.12 12.68-14.49 12.96-13.96 12.89-14.49 12.89-14.49 13.42-14.28 12.68-13.50 By purpose of loan 33 Feeder livestock 13.45 13.73 13.31 13.72 13.39 13.63 12.92 34 Other livestock 13.74 13.48 13.38 13.68 14.67 14.26 13.37 35 Other current operating expenses 13.65 13.40 13.50 13.79 13.58 13.88 14.14 36 Farm machinery and equipment 13.31 13.94 13.16 13.21 13.06 13.52 12.24 37 Other 13.25 13.46 13.68 12.39 13.35 13.62 12.98 1. Interest rate range that covers the middle 50 percent of the total dollar amount NOTE. For more detail, see the Board's E.2(416) statistical release. These data of loans made. have been updated since the issuance of the E.2. 2. Fewer than 10 sample loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Markets A25 1.35 INTEREST RATES Money and Capital Markets Averages, percent per annum 1980 1980. week ending Instrument 1977 1978 1979 July Aug. Sept. Oct. Oct. 3 Oct. 10 Oct. 17 Oct. 24 Oct. 31 Money market rates 1 Federal funds' 5.54 7.94 11.20 9.03 9.61 10.87 12.81 12.38 12.59 12.64 12.55 13.17 Commercial paper2-3 2 1-month 5.42 7.76 10.86 8.53 9.48 10.82 12.59 12.56 12.20 12.51 12.54 13.12 3 3-month 5.54 7.94 10.97 8.41 9.57 10.97 12.52 12.54 12.05 12.23 12.42 13.33 4 6-month 5.60 7.99 10.91 8.29 9.61 11.04 12.32 12.42 11.82 11.97 12.15 13.28 Finance paper, directly placed2-3 5 1-month 5.38 7.73 10.78 8.37 9.30 10.62 12.32 12.16 11.90 12.22 12.34 12.88 6 3-month 5.49 7.80 10.47 8.03 9.08 10.28 11.24 11.05 11.02 11.06 11.24 11.65 7 6-month 5.50 7.78 10.25 8.03 9.08 10.29 11.15 10.97 10.95 11.00 11.14 11.52 8 Prime bankers acceptances, 90-day3-4 5.59 8.11 11.04 8.58 9.85 11.13 12.69 12.51 12.17 12.24 12.66 13.71 Certificates of deposit, secondary market5 9 1-month 5.48 7.88 11.03 8.59 9.62 10.89 12.69 12.58 12.30 12.45 12.65 13.34 10 3-month 5.64 8.22 11.22 8.65 9.91 11.29 12.94 12.81 12.36 12.52 12.90 13.98 11 6-month 5.92 8.61 11.44 8.73 10.29 11.73 12.99 12.97 12.38 12.51 12.94 14.09 12 Eurodollar deposits, 3-month6 6.05 8.74 11.96 9.33 10.82 12.07 13.55 13.25 13.03 13.00 13.38 14.31 U.S. Treasury bills3-7 Secondary market 13 3-month 5.27 7.19 10.07 8.06 9.13 10.27 11.62 11.39 11.24 11.07 11.66 12.51 14 6-month 5.53 7.58 10.06 8.06 9.41 10.57 11.63 11.47 11.17 11.17 11.64 12.59 15 1-vear 5.71 7.74 9.75 8.00 9.39 10.48 11.30 11.14 10.87 10.85 11.36 12.16 Auction average8 16 3-month 5.265 7.221 10.041 8.126 9.259 10.321 11.580 11.524 11.295 11.338 11.413 12.331 17 6-month 5.510 7.572 . 10.017 8.101 9.443 10.546 11.566 11.718 11.140 11.281 11.407 12.284 Capital market rates U.S. TREASURY NOTES AND BONDS Constant maturities9 18 1-vear 6.09 8.34 10.67 8.65 10.24 11.52 12.49 12.28 11.99 11.98 12.56 13.51 19 2-year 6.45 8.34 10.12 9.03 10.53 11.57 12.09 12.02 11.56 11.71 12.20 12.95 20 2'Avear'0 11.55 12.25 21 3-year 6.69 8.29 9.71 9.27 10.63 11.57 12.01 11.97 11.54 11.65 12.08 12.82 22 5-vear 6.99 8.32 9.52 9.53 10.84 11.62 11.86 11.80 11.46 11.55 11.89 12.62 23 7-vear 7.23 8.36 9.48 9.84 10.95 11.57 11.79 11.79 11.44 11.49 11.80 12.45 24 10-vear 7.42 8.41 9.44 10.25 11.10 11.51 11.75 11.79 11.42 11.44 11.76 12.37 25 20-year 7.67 8.48 9.33 10.32 111111...000700 11.47 11.75 11.81 11.46 11.40 11.78 12.33 2266 30-vear 88..4499 99..2299 1100..2244 1111..3344 1111..5599 1111..6666 1111..2288 1111..2255 1111..6600 1122..1166 Composite11 27 3 to 5 years'2 6.85 8.30 9.58 28 Over 10 years (long-term) 7.06 7.89 8.74 9.83 10.53 10.94 11.20 11.27 10.93 10.90 11.21 11.74 STATE AND LOCAL NOTES AND BONDS Moody's series'3 29 Aaa 5.20 5.52 5.92 7.35' 8.03 8.36 8.38 8.50 8.40 8.30 8.30 8.40 30 Baa 6.12 6.27 6.73 8.46' 9.25 9.38 9.41 9.50 9.40 9.25 9 25 9.63 31 Bond Buver series14 5.68 6.03 6.52 8.13 8.67 8.94 9.11 9.22 9.01 8.81 9.06 9.45 CORPORATE BONDS 32 Seasoned issues, all industries15 8.43 9.07 10.12 11.77 12.33 12.80 13.07 13.08 12.98 12.91 13.03 13.35 By rating group 33 Aaa 8.02 8.73 9.63 11.07 11.64 12.02 12.31 12.30 12.18 12.11 12.27 12.72 34 Aa 8.24 8.92 9.94 11.43 12.09 12.52 12.68 12.74 12.59 12.49 12.61 12.99 35 A 8.49 9.12 10.20 11.95 12.44 12.97 13.05 13.12 13.03 12.95 12.99 13.17 36 Baa 8.97 9.45 10.69 12.67 13.15 13.70 14.23 14.12 14.12 14.09 14.27 14.49 Aaa utility bonds'6 37 New issue 8.19 8.96 10.03 11.60 12.32 12.74 13.18 13.08 13.02 12.62 13.21 13.92 38 Recently offered issues 8.19 8.97 10.02 11.41 12.31 12.72 13.13 13.06 12.87 12.85 13.03 13.79 MEMO: Dividend/price ratio17 39 Preferred stocks 7.60 8.25 9.07 9.81 10.04 10.14 10.64 10.51 10.46 10.44 10.66 11.12 40 Common stocks 4.56 5.28 5.46 5.20 5.06 4.90 4.80 4.91 4.74 4.69 4.76 4.91 1. Weekly figures are seven-day averages of daily effective rates for the week 2. 1980. Each weekly figure shown is calculated on a biweekly basis and is the ending Wednesday; the daily effective rate is an average of the rates on a given average of five business days ending on the Monday following the calendar week. day weighted by the volume of transactions at these rates. Beginning June 2. the biweekly rate is used to determine the maximum interest 2. Beginning November 1977, unweighted average of offering rates quoted by rate pavable in the following two-week period on small saver certificates. (See at least five dealers (in the case of commercial paper), or finance companies (in table 1.16.) the case of finance paper). Previously, most representative rate quoted by those 11. Unweighted averages for all outstanding notes and bonds in maturity ranges dealers and finance companies. Before November 1979. maturities for data shown shown, based on daily closing bid prices. "Long-term" includes all bonds neither are 30-59 days, 90-119 days, and 120-179 days for commercial paper: and 30-59 due nor callable in less than 10 years, including several very low yielding "flower" days, 90-119'days, and 150-179 days for finance paper. bonds. 3. Yields are quoted on a bank-discount basis. 12. The three- to five-year series has been discontinued. 4. Average of the midpoint of the range of daily dealer closing rates offered for 13. General obligations only, based on figures for Thursday, from Moody's domestic issues. Investors Service. 5. Five-day average of rates quoted by five dealers (three-month series was 14. Twenty issues of mixed quality. previously a seven-day average). 15. Averages of daily figures from Moody's Investors Service. 6. Averages of daily quotations for the week ending Wednesday. 16. Compilation of the Board of Governors of the Federal Reserve System. 7. Except for auction averages, yields are computed from daily closing bid prices. Issues included are long-term (20 years or more). New-issue yields are based on 8. Rates are recorded in the week in which bills are issued. quotations on date of offering; those on recently offered issues (included only for 9. Yield on the more actively traded issues adjusted to constant maturities by first 4 weeks after termination of underwriter price restrictions), on Friday closethe U.S. Treasury, based on daily closing bid prices. of-business quotations. Digitized for FR10A. SEaEcRh monthly figure is an average of only five business days near the end 17. Standard and Poor's corporate series. Preferred stock ratio based on a sample of the month. The rate for each month was used to determine the maximum of ten issues: four public utilities, four industrials, one financial, and one transhttp://fraser.sitnltoerueisst freatde .oparyga/b le in the following month on small saver certificates, until June portation. Common stock ratios on the 500 stocks in the price index. Federal Reserve Bank of St. Louis

A26 Domestic Nonfinancial Statistics • November 1980 1.36 STOCK MARKET Selected Statistics 1980 IInnddiiccaattoorr 11997777 11997788 11997799'' Apr. May June July Aug. Sept. Oct. Prices and trading (averages of daily figures) CCoommmmoonn ssttoocckk pprriicceess 11 NNeeww YYoorrkk SSttoocckk EExxcchhaannggee ((DDeecc.. 3311,, 11996655 == 5500)) .. 53.67 53.76 55.67 58.47 61.38 65.43 68.56 70.87 73.12 75.17 22 IInndduussttrriiaall 57.84 58.30 61.82 66.31 69.39 74.47 78.67 82.15 84.92 88.00 33 TTrraannssppoorrttaattiioonn 41.07 43.25 45.20 48.62 51.07 54.04 59.14 62.48 65.89 70.76 44 UUttiilliittyy 40.91 39.23 36.46 35.29 37.31 38.50 38.77 38.18 38.77 38.44 55 FFiinnaannccee 55.23 56.74 58.65 57.32 61.47 65.16 66.76 67.22 69.33 68.29 66 SSttaannddaarrdd && PPddoorr''ss CCoorrppoorraattiioonn ((11994411--4433 == 1100))11 .. 98.18 96.11 98.34 102.97 107.69 114.55 119.83 123.50 126.49 130.22 77 AAmmeerriiccaann SSttoocckk EExxcchhaannggee ((AAuugg.. 3311,, 11997733 == 110000)) 116.18 144.56 186.56 242.60 258.45 286.21 310.29 321.87 337.01 350.08 VVoolluummee ooff ttrraaddiinngg ((tthhoouussaannddss ooff sshhaarreess)) 88 NNeeww YYoorrkk SSttoocckk EExxcchhaannggee 20,936 28.591 32,233 32,102 36,425 39,508' 46,444 45,984 50,397 44,860 99 AAmmeerriiccaann SSttoocckk EExxcchhaannggee 2,514 3,622 4,182 3,428 3,799 5,240 6,195 6,452 7,880 7,087 Customer financing (end-of-period balances, in millions of dollars) 10 Regulated margin credit at brokers/dealers2 9,993 11,035 11,619' 11,309 11,441 11,370 11,522 12,007 12,731 11 Margin stock3 9,740 10,830 11,450' 11,140 11,270 11,200 11,320 11,800 12,520 12 Convertible bonds 250 205 167' 167 167 166 198 204 208 13 Subscription issues 3 1 2 r 2 4 4 4 3 3 n.a. Free credit balances at brokers4 14 Margin-account 640 835 1,105' 1,290 1,270 1,345 1,665' 1,695 1,850 15 Cash-account 2,060 2,510 4,060' 4,790 4,750 4,790 4,905' 4,925 5,680 Margin-account debt at brokers (percentage distribution, end of period) 16 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 17 B U x n d e e q r u i 4 tv 0 class (in percent)5 18.0 33.0 16.0 28.0 19.0 17.0 12.0 11.0 8.0 18 4(M9 36.0 28.0 29.0' 31.0 32.0 31.0 27.0 25.0 10.0 19 50-59 2131..00 18.0 27.0' 18.0 22.0 23.0 28.0 30.0 15.0 n. a. 20 60-69 10.0 14.0 10.0 12.0 13.0 16.0 16.0 26.0 1 2 2 1 2 8 7 0 0 - o 7 r 9 more 6 5 . . 0 0 6 5 . . 0 0 8 7 . . 0 0 6 7 . . 0 0 7 7 . . 0 0 8 7 . . 0 0 9 8 . . 0 0 1 8 0 . . 0 0 2 1 8 3 . . 0 0 \ Special miscellaneous-account balances at brokers (end of period) 23 Total balances (millions of dollars)6 9,910 13,092 16,150 16,339 16,543 16,920 17,886 18,350 19,283 t Distribution by equity status (percent) 1 24 Net credit status 43.4 41.3 44.2 44.3 45.8 47.6 48.7 48.2 49.0 n.a. Debt status, equity of | 25 60 percent or more 44.9 45.1 47.0 44.0 43.6 43.4 43.8 44.6 43.4 \ 26 Less than 60 percent 11.7 13.6 8.8 11.7 10.6 9.0 8.0 7.0 7.6 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 prorelated 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 All 1.37 SAVINGS INSTITUTIONS Selected Assets and Liabilities Millions of dollars, end of period 1979 1980 Account 1977 1978 Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept.P Savings and loan associations 1 Assets 459,241 523,542 579,307 582,252 585,685 589,498 591,108 593,321 594,792 597,023 603,720 609,685 2 Mortgages 381,163 432,808 475,797 476,448 477,303 479,078 480,165 480,092 481,184 482,985 487,198 492,132 Cash and investment securities' ... 39,150 44,884 46,541 48,473 50,168 50,899 50,576 52,670 52,613 52,370 53,545 53,672 4 Other 38,928 45,850 56,969 57,331 58,214 59,521 60,367 60,559 60,995 61,668 62,977 63,881 5 Liabilities and net worth 459,241 523,542 579,307 582,252 585,685 589,498 591,108 593,321 594,792 597,023 603,720 609,685 6 Savings capital 386,800 430,953 470,171 472,236 473,862 478,265 478,591 481,613 486,900 489,123 491,638 497,295 7 Borrowed money 27,840 42,907 55,375 55,233 55,276 57,346 57,407 55,353 54,950 53,615 55,552 58,524 8 FHLBB 19,945 31,990 40,441 40,364 40,337 42,413 42,724 41,529 40,613 39,882 41,005 42,613 q Other 7,895 10,917 14,934 14,869 14,939 14,933 14,683 13,824 14,337 13,733 14,547 15,911 10 Loans in process 9,911 10,721 9,511 8,735 8,269 8,079 7,660 7,126 6,974 7,055 7,483 J3 ,222 ii Other 9,506 9,904 11,684 13,315 15,385 12,683 14,260 16,246 13,056 14,455 16,291 12,749 12 Net worth2 25,184 29,057 32,566 32,733 32,893 33,125 33,190 32,983 32,912 32,775 32,756 32,895 13 MEMO: Mortgage loan commitments outstanding3 19,875 18,911 16,007 15,559 16,744 15,844 14,193 13,929 15,368 18,020 20,280 20,224 Mutual savings banks4 14 Assets 14,287 158,174 163,405 163,252 164,270 165,107 165,366 166,340 167,002 167,981 168,773 Loans IS Mortgage 88,195 95,157 98,908 98,940 99,220 99,151 99,045 99,163 99,150 99,268 99,526 16 Other 6,210 7,195 9,253 9,804 10,044 10,131 10,187 10,543 11,115 4,617' 4,738 Securities 17 U.S. government5 5,895 4,959 7,658 7,387 7,436 7,629 7,548 7,527 7,530 7,852 8,137 18 State and local government 2,828 3,333 2,930 2,887 2,853 2,824 2,791 2,727 2,701 2,697 2,701 19 Corporate and other6 37,918 39,732 37,086 37,114 37,223 37,493 37,801 38,246 38,325 38,927 39,390 20 Cash 2,401 3,665 3,156 2,703 3,012 3,361 3,405 3,588 3,575 3,274 3,472 21 Other assets 3,839 4,131 4,412 4,417 4,481 4,518 4,588 4,547 4,606 4,617 4,738 22 Liabilities 147,287 158,174 163,405 163,252 164,270 165,107 165,366 166,340 167,002 167,981 168,773 n .a. 23 Deposits 134,017 142,701 146,006 145,044 145,171 146,328 145,821 146,637 148,563 149,554 150,149 24 Regular7 132,744 141,170 144,070 143,143 143,284 144,214 143,765 144,646 146,394 147,390 147,999 25 Ordinary savings 78,005 71,816 61,123 59,252 58,234 56,948 54,247 54,669 56,329 57,682 58,135 26 Time and other 54,739 69,354 82,947 83,891 85,050 87,266 89,517 89,977 90,065 89,708 89,864 27 Other 1,272 1,531 1,936 1,901 1,887 2,115 2,056 1,990 2,169 2,164 2,150 28 Other liabilities 3,292 4,565 5,873 6,665 7,485 7,135 7,916 8,161 6,975 7,025 7,285 29 General reserve accounts 9,978 10,907 11,525 11,544 11,615 11,643 11,629 11,542 11,465 11,402 11,339 30 MEMO: Mortgage loan commitments outstanding8 4,066 4,400 3,182 2,919 2,618 2,397 2,097 1,883 1,849 1,939 1,898 Life insurance companies 31 Assets 351,722 389,924 432,282 436,226 438,638 439,733 442,932 447,020 450,858 455,759 459,362 Securities 32 Government 19,553 20,009 0,338 20,378 20,438 20,545 20,470 20,529 20,395 20,736 20,833 33 United States9 5,315 4,822 4,888 4,878 4,898 5,004 5,059 5,107 4,990 5,325 5,386 34 State and local 6,051 6,402 6,428 6,433 6,488 6,454 6,351 6,352 6,349 6,361 6,421 35 Foreign10 8,187 8,785 9,022 9,067 9,052 9,087 9,060 9,070 9,056 9,050 9,026 36 Business 175,654 198,105 218,128 222,332 223,423 221,214 222,175 223,556 224,874 228,645 230,477 n.a. 37 Bonds 141,891 162,587 178,371 181,820 182,521 182,536 182,750 183,356 184,329 186,385 187,839 38 Stocks 33,763 35,518 39,757 40,512 40,902 38,678 39,425 40,200 40,545 42,260 42,638 39 Mortgages 96,848 106,167 118,421 119,885 120,926 122,314 123,587 124,563 125,455 126,461 127,357 40 Real estate 11,060 11,764 13,007 13,083 13,201 13,512 13,696 13,981 14,085 14,164 14,184 41 Policy loans 27,556 30,146 34,825 35,302 35,839 36,901 38,166 38,890 39,354 39,649 39,925 42 Other assets 21,051 23,733 27,563 25,246 24,811 25,247 24,838 25,501 26,695 26,104 26,586 Credit unions 43 Total assets/liabilities and capital 53,755 62,348 65,854 64,506 64,857 65,678 65,190 66,103 68,102 68,429 69,553 70,515 44 Federal 29,564 34,760 35,934 35,228 35,425 36,091 35,834 36,341 37,555 37,573 38,168 39,219 45 State 24,191 27,588 29,920 29,278 29,432 29,587 29,356 29,762 30,547 30,856 31,385 31,296 46 Loans outstanding 41,845 50,269 53,125 52,089 51,626 51,337 50,344 49,469 48,172 47,829 47,884 47,211 47 Federal 22,634 27,687 28,698 28,053 27,783 27,685 27,119 26,550 25,773 25,435 25,401 25,381 48 State 19,211 22,582 24,426 24,036 23,843 23,652 23,225 22,919 22,399 22,394 22,483 21,830 49 Savings 46,516 53,517 56,232 55,447 55,790 56,743 56,338 57,197 59,310 60,574 61,403 63,728 50 Federal (shares) 25,576 29,802 35,530 30,040 32,256 30,948 30,851 31,403 32,764 33,472 33,964 35,961 51 State (shares and deposits) 20,940 23,715 25,702 25,407 25,534 25,795 25,487 25,794 26,546 27,102 27,439 27,767 For notes see bottom of page A28. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic Financial Statistics • November 1980 1.38 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Calendar year FFiissccaall FFiissccaall FFiissccaall Type of account or operation yyeeaarr yyeeaarr yyeeaarr 1979 1980 1980 11997777 11997788 11997799 HI H2 HI July Aug. Sept. U.S. budget 1 Receipts1 357,762 401,997 465,940 246,574 233,952 270,864 37,348 44,259 53,544 2 Outlays1 402,725 450,836 493,673 245,616 263,044 289,899 52,409 50,755 47,289 3 Surplus, or deficit( -) -44,963 -48,839 -27,733 958 -29,093 -19,035 -15,062 -6,496 6,255 4 Trust funds 9,497 12,693 18,335 4,041 9,679 4,383 -8,224 2,227 8,286 5 Federal funds2 -54,460 -61,532 -46,069 -3,083 -38,773 -23,418 -6,838 -8,723 -2,031 OOffff--bbuuddggeett eennttiittiieess ((ssuurrpplluuss,, oorr ddeeffiicciitt 66 FFeeddeerraall FFiinnaanncciinngg BBaannkk oouuttllaayyss -8,415 -10,661 -13,261 -7,712 -5,909 -7,735 -1,214 -929 -1,861 77 OOtthheerr** -269 334 832 -447 805 -528 -107 -922 41 U.S. budget plus off-budget, including Federal Financing Bank, 8 Surplus, or deficit (-) -53,647 -59,166 -40,162 -7,201 -34,197 -27,298 -16,383 -8,347 4,435 Source or financing 9 Borrowing from the public 53,516 59,106 33,641 6,039 31,320 24,435 9,737 11,111 6,260 10 Cash and monetary assets (decrease, or increase (- ))* -2,247 -3,023 -408 -8,878 3,059 -3,482 3,346 -2,464 -9,692 11 Others 2,378 3,083 6,929 10,040 -182 6,345 3,300 -300 -1,002 MEMO: 12 Treasury operating balance (level, end of period) 19,104 22,444 24,176 17,485 15,924 14,092 10,432 12,494 20,990 13 Federal Reserve Banks 15,740 16,647 6,489 3,290 4,075 3,199 3,954 2,742 4,102 14 Tax and loan accounts 3,364 5,797 17,687 14,195 11,849 10,893 6,478 9,752 16,888 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 surplus/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 1.37 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 Inassets." 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. Life insurance companies: Estimates of the American Council of Life Insurance Before 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 A29 1.39 U.S. BUDGET RECEIPTS AND OUTLAYS Millions of dollars Calendar year FFFiiissscccaaalll FFFiiissscccaaalll FFFiiissscccaaalll SSSooouuurrrccceee ooorrr tttyyypppeee yyyeeeaaarrr yyyeeeaaarrr yyyeeeaaarrr 1979 1980 1980 111999777777 111999777888 111999777999 HI H2 HI July Aug. Sept. RECEIPTS 1 A11 sources1 357,762 401,997 465,940 246,574 233,952 270,864 37,348 44,259 53,544 2 Individual income taxes, net 157,626 180,988 217,841 111,603 115,488 119,988 19,773 19,527 26,936 3 Withheld 144,820 165,215 195,295 98,683 105,764 110,394 19,513 19,220 18,731 4 Presidential Election Campaign Fund . 37 39 36 32 3 34 4 0 0 5 Nonwithheld 42,062 47,804 56,215 44,116 12,355 49,707 1,580 1,103 8,632 6 Refunds1 29,293 32,070 33,705 31,228 2,634 40,147 1,324 796 429 Corporation income taxes 7 Gross receipts 60,057 65,380 71,448 42,427 29,169 43,434 2,673 1,848 9,531 8 Refunds 55,,116644 5,428 5,771 2,889 3,306 4,064 537 481 647 9 Social insurance taxes and contributions, net 108,683 123,410 141,591 75,609 71,031 86,597 10,253 18,546 12,860 10 Payroll employment taxes and contributions2 88,196 99,626 115,041 59,298 60,562 69,077 8,697 15,512 11,520 11 Self-employment taxes and contributions3 4,014 4,267 5,034 4,616 417 5,535 -231 0 419 12 Unemployment insurance 11,312 13,850 15,387 8,623 6,899 8,690 1,229 2,423 299 13 Other net receipts4 5,162 5,668 6,130 3,072 3,149 3,294 558 612 622 14 Excise taxes 17,548 18,376 18,745 8,984 9,675 11,383 2,662 2,687 2,734 15 Customs deposits 5,150 6,573 7,439 3,682 3,741 3,443 663 617 605 16 Estate and gift taxes 7,327 5,285 5,411 2,657 2,900 3,091 623 595 611 17 Miscellaneous receipts5 6,536 7,413 9,237 4,501 5,254 6,993 1,240 918 914 OUTLAYS 18 All types1 402,725 450,836 493,673 245,616 263,044 289,899 52,409 50,755 47,289 19 National defense 97,501 105,186 117,681 57,643 62,002 69,132 11,666 11,698 11,636 20 International affairs 4,813 5,922 6,091 3,538 4,617 4,602 1,445 546 532 21 General science, space, and technology .. 4,677 4,,742 5,041 2,461 3,299 3,150 503 556 391 22 Energy 4,172 5,861 6,856 4,417 3,281 3,126 619 645 630 23 Natural resources and environment 10,000 10,925 12,091 5,672 7,350 6,668 1,316 1,275 1,314 24 Agriculture 5,532 7,731 6,238 3,020 1,709 3,193 -247 -131 -184 25 Commerce and housing credit -44 3,324 2,565 60 3,002 3,878 781 88 -26 26 Transportation 14,636 15,445 17,459 7,688 10,298 9,582 1,948 1,778 2,077 27 Community and regional development ... 6,348 11,039 9,482 4,499 4,855 5,302 593 941 1,128 28 Education, training, employment, social services 20,985 26,463 29,685 14,467 14,579 16,686 2,435 2,560 2,595 29 Health 38,785 43,676 49,614 24,860 26,492 29,299 5,043 4,897 5,284 30 Income security1 137,915 146,212 160,198 81,173 86,007 94,600 17,941 17,999 17,487 31 Veterans benefits and services 18,038 18,974 19,928 10,127 10,113 9,758 1,715 2,659 747 32 Administration of justice 3,600 3,802 4,153 2,096 2,174 2,291 400 353 350 33 General government 3,312 3,737 4,153 2,291 2,103 2,422 413 642 428 34 General-purpose fiscal assistance 9,499 9,601 8,372 3,890 4,286 3,940 1,830 46 150 35 Interest6 38,009 43,966 52,556 26,934 29,045 32,658 4,602 5,063 4,752 36 Undistributed offsetting receipts6-7 -15,053 -15,772 -18,489 -8,999 -12,164 -10,387 -594 -860 -2,000 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 from an accrual basis to a cash basis for the outlays retroactive to January 1976. interest on special issues for U.S. government accounts. 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

A30 Domestic Financial Statistics • November 1980 1.40 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars 1978 1979 1980 IItteemm June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 Dec. 31. Mar. 31 June 30 1 Federal debt outstanding 758.8 780.4 797.7 804.6 812.2 833.8 852.2 870.4 884.4 2 Public debt securities 749.0 771.5 789.2 796.8 804.9 826.5 845.1 863.5 877.6 3 Held by public 587.9 603.6 619.2 630.5 626.4 638.8 658.0 677.1 682.7 4 Held by agencies 161.1 168.0 170.0 166.3 178.5 187.7 187.1 186.3 194.9 5 Agency securities 9.8 8.9 8.5 7.8 7.3 7.2 7.1 7.0 6.8 6 Held by public 8.0 7.4 7.0 6.3 5.9 5.8 5.6 5.5 5.3 7 Held by agencies 1.8 1.5 1.5 1.5 1.5 1.5 1.5 1.5 1.5 8 Debt subject to statutory limit 750.2 772.7 790.3 797.9 806.0 827.6 846.2 864.5 878.7 9 Public debt securities 748.4 770.9 788.6 796.2 804.3 825.9 844.5 862.8 877.0 10 Other debt1 1.8 1.8 1.7 1.7 1.7 1.7 1.7 1.7 1.7 11 MEMO. Statutory debt limit • 752.0 798.0 798.0 798.0 830.0 830.0 879.0 879.0 925.0 1. Includes guaranteed debt of government agencies, specified participation NOTE. Data from Treasury Bulletin (U.S. Treasury Department), certificates, notes to international lending organizations, and District of Columbia stadium bonds. 1.41 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1980 Type and holder 997766 11997777 11997788 11997799 June July Aug. Sept. Oct. 1 Total gross public debt 653.5 718.9 789.2 845.1 877.6 881.7 893.4 907.7 908.2 By type 2 Interest-bearing debt 652.5 715.2 782.4 844.0 876.3 880.4 888.7 906.4 906.9 3 Marketable 363.2 459.9 487.5 530.7 566.7 576.1 583.4 594.5 599.4 4 Bills 164.0 161.1 161.7 172.6 184.7 191.5 199.3 199.8 202.3 5 Notes 216.7 251.8 265.8 283.4 301.5 302.6 300.3 310.9 311.9 6 Bonds 40.6 47.0 60.0 74.7 80.6 82.0 83.9 83.8 85.2 7 Nonmarketable1 231.2 255.3 294.8 313.2 309.5 304.3 305.3 311.9 307.5 8 Convertible bonds2 2.3 2.2 2.2 2.2 — — — 9 State and local government series 4.5 13.9 24.3 24.6 23.6 23.5 23.6 23.6 23.9 10 Foreign issues3 22.3 22.2 29.6 28.8 25.5 25.8 25.8 25.2 24.8 11 Government 22.3 22.2 28.0 23.6 19.0 19.3 19.4 18.7 18.4 12 Public 0 0 1.6 5.3 6.4 6.4 6.4 6.4 6.4 13 Savings bonds and notes 72.3 77.0 80.9 79.9 73.4 73.3 73.2 73.0 73.0 14 Government account series4 129.7 139.8 157.5 177.5 186.8 181.5 182.4 189.8 185.7 15 Non-interest-bearing debt 1.1 3.7 6.8 1.2 1.3 1.3 4.7 1.3 - By holder5 16 U.S. government agencies and trust funds 147.1 154.8 170.0 187.1 194.9 189.2 189.8 17 Federal Reserve Banks 97.0 102.5 109.6 117.5 124.5 119.6 119.3 18 Private investors 409.5 461.3 508.6 540.5 558.2 572.9 583.8 19 Commercial banks 103.8 101.4 93.1 97.0 93.6 94.4 98.1 20 Mutual savings, banks 5.9 5.9 5.0 4.7 4.5 4.7 5.0 21 Insurance companies 12.7 15.5 14.9 14.4 13.8 14.4 14.1 22 Other companies 27.7 22.7 21.2 23.9 22.8 25.3 24.6 n. a. n.a. 23 State and local governments 41.6 54.8 64.4 67.4 67.4 68.9 70.7 Individuals 24 Savings bonds 72.0 76.7 80.7 79.9 73.4 73.3' 73.2 25 Other securities 28.8 28.6 33.3 34.2 46.7 47.9 50.9 26 Foreign and international6 78.1 109.6 137.8 123.8 122.9' 124.8 125.8 27 Other miscellaneous investors7 38.9 46.0 58.2 97.6 113.1 119.2' 121.8 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 penbe 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). 3. Nonmarketable dollar-denominated and foreign currency-denominated series NOTE. Gross public debt excludes guaranteed agency securities and, beginning held by foreigners. in July 1974, includes Federal Financing Bank security issues. 4. Held almost entirely by U.S. government agencies and trust funds. Data by type of security from Monthly Statement of the Public Debt of the United 5. Data for Federal Reserve Banks and U.S. government agencies and trust States (U.S. Treasury Department); data by holder from Treasury Bulletin. 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 A31 1.42 U.S. GOVERNMENT MARKETABLE SECURITIES Ownership, by maturity Par value; millions of dollars, end of period 1980 1980 TTyyppee ooff hhoollddeerr 1978 1979 1978 11997799 July August July August All maturities 1 to 5 years 1 All holders 487,546 530,731 576,145 583,419 162,886 164,198 186,108 188,841 2 U.S. government agencies and trust funds 12,695 11,047 10,327 10,078 3,310 2,555 2,541 2,255 3 Federal Reserve Banks 109.616 117,458 119,563 119,277 31,283 28,469 34,352 35,823 4 Private investors 365.235 402,226 446,255 454,063 128,293 133.173 149,215 150,764 5 Commercial banks 68,890 69.076 70,162 72,952 38,390 38,346 42,311 43,992 6 Mutual savings banks 3,499 3.204 3,197 3,365 1,918 1,668 1,606 1,669 7 Insurance companies 11.635 11.496 11,466 11,229 4.664 4,518 4,147 4,373 8 Nonfinancial corporations 8.272 8,433 8,083 7,761 3,635 2,844 2,966 2,419 9 Savings and loan associations 3.835 3,209 3,151 3,168 2,255 1,763 1,895 1,908 10 State and local governments 18.815 15,735 18,606 19.376 3,997 3,487 4,299 4,212 11 All others 250.288 291,072 331,589 336,213 73,433 80,546 91,991 92,191 Total, within 1 year 5 to 10 years 12 All holders 228,516 255,252 268,316 275,387 50,400 50,440 54,714 50,326 13 U.S. government agencies and trust funds 1,488 1,629 1,047 1,084 1,989 871 1,398 1,398 14 Federal Reserve Banks 52,801 63,219 57,163 55,326 14,809 12,977 13,891 13,276 15 Private investors 174,227 190,403 210,105 218,977 33,601 36,592 39,426 35,653 16 Commercial banks 20,608 20,171 17,712 20,859 7,490 8,086 7,639 5,632 17 Mutual savings banks 817 836 823 964 496 459 514 445 18 Insurance companies 1,838 2.016 1,781 1,736 2,899 2.815 3,181 2,818 19 Nonfinancial corporations 4,048 4,933 3,845 4,141 369 308 469 340 20 Savings and loan associations 1,414 1,301 1,082 1,128 89 69 114 75 21 State and local governments 8,194 5,607 6,594 7,212 1,588 1,540 1,888 1,770 22 All others 137,309 155,539 178,270 182,937 20,671 23,314 25,622 24,573 Bills, within 1 year 10 to 20 years 23 All holders 161,747 172,644 191,491 199,306 19,800 27,588 30,890 35,524 24 U.S. government agencies and trust funds 2 0 1 1 3,876 4,520 3,608 3,686 25 Federal Reserve Banks 42,397 45.337 44,368 43,600 2,088 3,272 3,600 5,891 26 Private investors 119,348 127,306 147,122 155,705 13,836 19,796 23,682 25,948 27 Commercial banks 5,707 5,938 5,232 7,655 956 993 1,072 1,082 28 Mutual savings banks 150 262 177 233 143 127 166 186 29 Insurance companies 753 473 551 461 1,460 1,305 1,385 1,509 30 Nonfinancial corporations 12 2.793 1,627 1,920 86 218 333 412 31 Savings and loan associations 262 219 203 249 60 58 42 44 32 State and local governments 5.524 3.100 4,192 4,824 1,420 1,762 2,399 3,211 33 All others 105.161 114,522 135,140 140,373 9,711 15,332 18,285 19,503 Other, within 1 year Over 20 years 34 All holders 66,769 82,608 76,824 76,081 25,944 33,254 36,117 33,340 35 U.S. government agencies and trust funds 1.487 1.629 1,046 1,083 2,031 1,472 1,734 1,656 36 Federal Reserve Banks 10,404 17,882 12,795 11,726 8,635 9,520 10,558 8,962 37 Private investors 54,879 63.097 62,983 63,272 15,278 22,262 23,826 22,723 38 Commercial banks 14,901 14,233 12,480 13,204 1,446 1,470 1,429 1,387 39 Mutual savings banks 667 574 646 731 126 113 89 102 40 Insurance companies 1,084 1.543 1,230 1,274 774 842 972 794 41 Nonfinancial corporations 2,256 2,140 2,218 2,231 135 130 469 449 42 Savings and loan associations 1,152 1.081 878 879 17 19 18 13 43 State and local governments 2,670 2,508 2,402 2,388 3,616 3,339 3,428 2,971 44 All others 32,149 41,017 53,129 42,564 9,164 16,340 17,422 17,008 NOTE. Direct public issues only. Based on Treasury Survey of Ownership from 460 mutual savings banks, and 723 insurance companies, each about 80 percent; Treasury Bulletin (U.S. Treasury Department). (2) 413 nonfinancial corporations and 479 savings and loan associations, each about Data complete for U.S. government agencies and trust funds and Federal Re- 50 percent; and (3) 492 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 August 31, 1980: (1) 5,359 commercial banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 Domestic Financial Statistics • November 1980 1.43 U.S. GOVERNMENT SECURITIES DEALERS Transactions Par value; averages of daily figures, in millions of dollars 1980 1980. week ending Wednesday IItteemm 11997777 11997788 11997799 June July Aug. June 25 July 2 July 9 July 16 July 23 July 30 1 U.S. government securities 10,838 10,285 13,183 17,742 15,824 17,892 17,011 17,019 16,905 14,078 15,294 15,146 Bv maturity 2 Bills ....." 6.746 6,173 7.915 9.996 10,108 10,387 9.710 10.410 10.805 9.130 10.020 9,010 3 Other within 1 year 237 392 454 560 348 465 439 533 327 401 252 360 4 1-5 years 2.320 1.889 2,417 3,718 2.680 3,546 4.083 3.239 2.380 2.218 2.491 3,361 5 5-10 years 1.148 965 1.121 1,770 1,121 1,692 1.238 1.217 1.257 831 1.204 1,031 6 Over 10 years 388 867 1.276 1.697 1.567 1,802 1.542 1.620 2.135 1.499 1.327 1,385 By type of customer 1 U.S. government securities dealers 1.268 1.135 1.448 1.382 1.204 1.333 1,287 1.401 1.219 965 1.308 1,077 8 U.S. government securities brokers 3.709 3.838 5,170 7,184 6.513 7.418 6,568 6.521 7.417 5,867 6.405 5,840 9 Commercial banks 2.294 1,804 1.904 2,312 2.032 2,164 2,370 2.204 2.149 1,727 1.878 2,155 10 All others1 3.567 3,508 4.660 6,864 6.074 6,977 6,785 6.893 6.122 5,520 5.703 6,074 11 Federal agency securities 1,729 1,894 2,723 3,689 3,234 2,735 3,322 3,154 3,675 3,578 2,609 3,122 1. Includes, among others, all other dealers and brokers in commodities and Transactions are market purchases and sales of U.S. government securities dealsecurities, 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. 1.44 U.S. GOVERNMENT SECURITIES DEALERS Positions and Sources of Financing Par value; averages of daily figures, in millions of dollars 1980 1980, week ending Wednesday Item 1977 1978 1979 June July Aug. June 4 June 11 June 18 June 25 July 2 July 9 Positions1 1 U.S. government securities 5,172 2,656 3,223 5,156 5,240 5,947 6,009 7,029 4,686 4,301 3,134 4,011 2 Bills 4,772 2.452 3,813 3,720 4.603 5.149 4,508 4.779 3.518 3,402 2,258 3,163 3 Other within 1 year 99 260 -325 -731 -1.150 -1,336 -756 -672 -716 -759 -908 -1,055 4 1-5 years 60 -92 -455 916 1.074 1,391 776 1.144 684 769 1.035 890 5 5-10 vears 92 40 160 504 73 218 456 876 478 292 234 227 6 Over 10 years 149 -4 30 747 640 526 1.026 903 722 598 515 786 7 Federal agency securities 693 606 1,471 1,411 1,182 691 1,185 1,427 1,328 1,540 1,397 1,454 Financing2 8 All sources 9,877 10,204 16,003 2,676 n.a. n.a. 20,115 n.a. n.a. n.a. n.a. n.a. Commercial banks 9 New York City 1.313 599 1,396 105 n.a. n.a. 853 n.a. n.a. n.a. n.a. n.a. 10 Outside New York City 1.987 2.174 2,868 496 n.a. n.a. 3,641 n.a. n.a. n.a. n.a. n.a. 11 Corporations3 2.358 2,379 3,373 628 n.a. n.a. 4.874 n.a. n.a. n.a. n.a. n.a. 12 All others 4.158 5,052 4,104 1,447 n.a. n.a. 10,747 n.a. n.a. n.a. n.a. n.a. 1. Net 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 potrade-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 A33 1.45 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt outstanding Millions of dollars, end of period 1980 AAggeennccyy 11997766 11997777 11997788 Jan. Feb. Mar. Apr. May June 1 Federal and federally sponsored agencies1 103,848 112,472 137,063 165,819 167,813 173,216 176,880 179,062 179,353 2 Federal agencies 22,419 22,760 23,488 24,883 25,013 25.583 25,776 25,904 26,667 3 Defense Department2 1,113 983 968 729 719 709 688 679 674 4 Export-Import Bank3-4 8,574 8.671 8,711 9,176 9,144 9,627 9,615 9,597 10,275 5 Federal Housing Administration5 575 581 588 539 546 550 537 531 524 6 Government National Mortgage Association participation certificates6 4,120 3,743 3,141 2,979 2,979 2,979 2,937 2,937 2,877 7 Postal Service7 2,998 2,431 2,364 1,837 1,837 1,837 1,837 1,770 1,770 8 Tennessee Valley Authority 4,935 6,015 7,460 9,182 9,347 9,440 9,695 9,920 10,075 9 United States Railway Association7 104 336 356 441 441 441 467 470 472 10 Federally sponsored agencies1 81,429 89,712 113,575 140,936 142,800 147,633 151,104 153,158 152,686 11 Federal Home Loan Banks 16,811 18.345 27,563 33,122 33,102 35,309 36,352 37,540 36,748 12 Federal Home Loan Mortgage Corporation 1,690 1.686 2,262 2,769 2,764 2,644 2,643 2,642 2,642 13 Federal National Mortgage Association 30,565 31,890 41,080 49,031 50,139 51,614 52,456 52,573 52,389 14 Federal Land Banks • 17,127 19,118 20,360 15,106 15,106 15,106 13,940 13,940 13,940 15 Federal Intermediate Credit Banks 10,494 11,174 11,469 2,144 2,144 2,144 2,144 2,144 2,144 16 Banks for Cooperatives 4,330 4,434 4,843 584 584 584 584 584 584 17 Farm Credit Banks1 2,548 5,081 36,584 37,240 38,446 41 039 41 629 42,058 18 Student Loan Marketing Association8 410 515 915 1,595 1,720 1,785 1,945 2,105 2,180 19 Other 2 2 2 1 1 1 1 1 1 MEMO: 20 Federal Financing Bank debt7'9 28,711 38,580 51,298 68,294 69,268 71,885 74,009 76,009 77,408 Lending to federal and federally sponsored agencies 21 Export-Import Bank4 5,208 55,,883344 6,898 8,353 8,353 8,849 8,849 8,849 9,558 22 Postal Service7 2,748 2,181 2,114 1,587 1,587 1,587 1,587 1,520 1,520 23 Student Loan Marketing Association8 410 515 915 1,595 1,720 1,785 1,945 2,105 2,180 24 Tennessee Valley Authority 3,110 4.190 5,635 7,457 7,622 7,715 7,970 8,195 8,350 25 United States Railway Association7 104 336 356 441 441 441 467 470 472 Other Lending10 26 Farmers Home Administration 10,750 16.095 23,825 32,145 32,565 33,410 34,755 35,745 35,745 27 Rural Electrification Administration 1,415 2.647 4,604 6,701 6,874 7,039 7,155 7,631 7,942 28 Other 4,966 6,782 6,951 10,015 10,106 11,059 11,281 11,494 11,641 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 Asconsolidated 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 parcurities 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

A34 Domestic Financial Statistics • November 1980 1.46 NEW SECURITY ISSUES of State and Local Governments Millions of dollars 1980 TTyyppee ooff ii oo ss rr ss uu uu ee ss ee oo rr iissssuueerr,, 11997777 11997788 11997799 Mar. Apr. May June July Aug .P 1 All issues, new and refunding1 46,769 48,607 43,490 2,385 4,833 4,570 5,960 4,692 3,792 Type of issue 2 General obligation 18.042 17,854 12,109 731 1.662 1,534 1,886 1,368 787 3 Revenue 28.655 30.658 31.256 1,648 3,170 3,032 4,071 33,,331199 22,,999955 4 Housing Assistance Administration2 5 U.S. government loans 72 95 125 6 1 4 3 5 10 Type of issuer 6 State 6,354 6,632 4.314 393 466 749 897 185 304 7 Special district and statutory authority 21.717 24,156 23,434 1.2(H) 2.175 2,276 3,414 3,034 2,200 8 Municipalities, counties, townships, school districts 18,623 17,718 15,617 786 2,192 1,539 1,647 1,468 1,278 9 Issues for new capital, total 36,189 37,629 41,505 2,379 4,704 4,501 5,886 4,327 3,771 Use of proceeds 10 Education 5,076 5,003 5,130 191 488 297 783 618 263 11 Transportation 2,951 3,460 2.441 156 299 193 329 143 98 12 Utilities and conservation 8,119 9,026 8.594 440 607 688 563 1,221 1,176 13 Social welfare 8.274 10,494 15.968 1,133 2,062 1.801 2,986 1,607 1,421 14 Industrial aid 4.676 3,526 3.836 211 315 484 332 120 340 15 Other purposes 7,093 6,120 5,536 248 933 1,038 893 618 473 1. Par amounts of long-term issues based on date of sale. SOURCE. Public Securities Association. 2. Only bonds sold pursuant to the 1949 Housing Act, which are secured by contract requiring the Housing Assistance Administration to make annual contributions to tne local authority. 1.47 NEW SECURITY ISSUES of Corporations Millions of dollars 1980 TTyyppee ooff ii oo ss rr ss uu uu ee ss ee oo rr iissssuueerr,, 11997777 11997788 11997799 Jan. Feb. Mar. Apr. May June July 1 AH issues1 53,792 47,230 51,464 6,210 4,452 4,353 5,677 9,067 9,511 7,737 2 Bonds 42,015 36,872 40,139 4,834 2,856 2,771 4,775 7,335 8,148 6,376 Type of offering 3 Public 24,072 19.815 25.814 2.450 1,426 1.985 3,828 6.810 7,548 5,355 4 Private placement 17,943 17,057 14.325 2,384 1.430 786 947 525 600 1,021 Industry group 5 Manufacturing 12,204 9,572 9.667 943 960 693 1,697 2.400 2,318 2,726 6 Commercial and miscellaneous 6,234 5,246 3,941 634 262 215 457 560 1,629 969 7 Transportation 1,996 2,007 3,102 431 227 94 173 364 385 329 8 Public utility 8,262 7.092 8,118 1,338 635 1,423 572 723 1,412 316 9 Communication 3,063 3,373 4,219 483 533 196 598 1.171 209 787 10 Real estate and financial 10.258 9.586 11,095 1,006 238 152 1.278 2,116 2,195 1,248 11 Stocks 11,777 10,358 11,325 1,376 1,596 1,582 902 1,732 1,363 1,361 Type 12 Preferred 3,916 2,832 3,574 287 88 525 223 202 382 360 13 Common 7,861 7,526 7.751 1,089 1,508 1,057 679 1,530 981 1,001 Industry group 14 Manufacturing 1,189 1,241 1.679 333 380 598 81 215 127 155 15 Commercial and miscellaneous 1,834 1,816 2.623 313 426 404 374 512 202 390 16 Transportation 456 263 255 59 58 36 9 27 9 17 Public utility 5,865 5.140 5,171 535 627 408 319 615 494 714 18 Communication 1.379 264 303 39 27 53 25 126 19 Real estate and financial 1,049 1.631 1,293 135 65 109 67 338 406 104 1, Figures, which represent gross proceeds of issues maturing in more than one 1933, employee stock plans, investment companies other than closed-end, intrayear, 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 $1()(),0(X), 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 A35 1.48 OPEN-END INVESTMENT COMPANIES Net Sales and Asset Position Millions of dollars 1980 IItteemm 11997788 11997799 Feb. Mar. Apr. May June July Aug.' Sept. INVESTMENT COMPANIES1 1 Sales of own shares2 6,645 7,495 773 723 1,010 1,175 1,772 1,890 1,507 1,405 2 Redemptions of own shares3 7,231 8,393 882 892 762 647 775 863 1,019 1,228 3 Net sales -586 -898 -109 -169 248 528 997 1,027 488 177 4 Assets4 44,980 49,493 49,512 44,581 47,270 50,539 52,946 54,406 54,941 55,779 5 Cash position5 4,507 4,983 5,895 5,644 5,862 6,209 6,495 5,629 5,619 5,481 6 Other 40,473 44,510 43,617 38,937 41,708 44,330 46,451 48,777 49,322 50,298 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 reinvestment curities. 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 Seother 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. 1.49 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1978 1979 1980 AAccccoouunntt 11997777 11997788 11997799 Q4 Q1 Q2 Q3 Q4 Q1 Q2 1 Profits before tax 177.1 206.0 236.6 227.4 233.3 227.9 242.3 243.0 260.4 204.8 2 Profits tax liability 72.6 84.5 92.5 95.1 91.3 88.7 94.0 96.1 102.4 77.6 3 Profits after tax 104.5 121.5 144.1 132.3 142.0 139.2 148.3 146.9 158.0 127.2 4 Dividends 42.1 47.2 52.7 49.7 51.5 52.3 52.8 54.4 56.7 58.6 5 Undistributed profits 62.4 74.4 91.4 82.6 90.5 86.9 95.5 92.5 101.3 68.6 6 Capital consumption allowances 109.3 119.8 131.0 123.0 125.4 130.4 132.8 135.2 137.4 139.3 7 Net cash flow 171.7 194.1 222.3 205.6 215.9 217.3 228.3 227.7 238.7 207.9 SOURCE. Survey of Current Business (U.S. Department of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 Domestic Nonfinancial Statistics • November 1980 1.50 NONFINANCIAL CORPORATIONS Current Assets and Liabilities Billions of dollars, except for ratio 1979 1980 Account 1975 1976 1977 1978 Q1 02 Q3 04 Q1 02 1 Current assets 759.0 826.8 902.1 1,030.0 1,081.0 1,108.2 1,169.5 1,200.9 1,235.2 1,233.8 2 Cash 82.1 88.2 95.8 104.5 102.7 100.1 103.7 116.1 110.2 111.4 3 U.S. government securities 19.0 23.4 17.6 16.3 17.4 18.6 15.8 15.6 15.1 13.9 4 Notes and accounts receivable 272.1 292.8 324.7 383.8 408.1 421.1 453.0 456.8 471.2 464.2 5 Inventories 315.9 342.4 374.8 426.9 451.4 465.2 489.4 501.7 519.5 525.7 6 Other 69.9 80.1 89.2 98.5 101.4 103.2 107.7 110.8 119.3 118.7 7 Current liabilities 451.6 494.7 549.4 665.5 705.4 724.7 777.8 809.1 838.3 828.1 8 Notes and accounts payable 264.2 281.9 313.2 373.7 391.3 406.4 438.8 456.3 467.9 463.1 9 Other 187.4 212.8 236.2 291.7 314.1 318.3 339.0 352.8 370.4 364.9 10 Net working capital 307.4 332.2 352.7 364.6 375.6 383.5 391.7 391.8 397.0 405.7 11 MEMO: Current ratio L 1.681 1.672 1.642 1.548 1.532 1.529 1.504 1.484 1.474 1.490 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. 1.51 BUSINESS EXPENDITURES on New Plant and Equipment Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1979 1980 IInndduussttrryy 11997788 11997799 Q1 02 03 04 Q1 02 Q32 042 1 All industries 153.82 177.09 165.94 173.48 179.33 186.95 191.36 193.89 191.24 193.17 2 Durable eooJs industries 31.66 38.23 34.00 36.86 39.72 41.30 42.30 42.80 40.35 41.55 3 Nondurable goods industries 35.96 40.69 37.56 39.56 40.50 43.88 45.01 45.98 46.90 47.33 Nonmanufacturing 4 Mining 4.78 5.56 5.46 5.31 5.42 6.06 6.02 6.56 6.40 6.75 Transportation 5 Railroad 3.32 3.93 4.02 3.66 4.03 4.20 4.40 3.97 3.90 4.75 6 Air 2.30 3.24 3.35 3.26 3.10 3.39 2.98 4.11 3.73 3.75 7 Other 2.43 2.95 2.71 2.79 3.16 3.15 2.94 2.73 2.93 2.72 Public utilities 8 Electric 29.48 32.56 27.70 28.06 28.32 26.02 28.78 27.86 26.84 25.95 9 Gas and other 4.70 5.07 4.66 5.18 5.01 5.50 5.57 5.43 5.32 5.78 10 Communication 18.16 20.56 18.75 20.29 20.41 22.71 22.48 22.65 \ 11 Commercial and other* 25.71 29.35 27.73 28.51 29.66 30.72 30.86 31.80 > 54.87 > 54.60 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 Comme:;e). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Corporate Finance A37 1.52 DOMESTIC FINANCE COMPANIES Assets and Liabilities Billions of dollars, end of period 1979 1980 AAccccoouunntt 11997744 11997755 11997766 11997777 11997788 Q2 Q3 Q4 Q1 Q2 ASSETS Accounts receivable, gross 1 Consumer 36.1 36.0 38.6 44.0 52.6 58.7 62.3 65.7 67.7 70.2 2 Business 37.2 39.3 44.7 55.2 63.3 70.1 68.1 70.3 70.6 70.3 3 Total 73.3 75.3 83.4 99.2 116.0 128.8 130.4 136.0 138.4 140.4 4 LESS: Reserves for unearned income and losses ... 9.0 9.4 10.5 12.7 15.6 17.7 18.7 20.0 20.4 21.4 5 Accounts receivable, net 64.2 65.9 72.9 86.5 100.4 111.1 111.7 116.0 118.0 119.0 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 24.61 25.8 24.9 23.7 26.1 8 All other 12.0 11.8 12.6 14.3 17.3 9 Total assets 79.6 81.6 89.2 104.3 122.4 135.8 137.4 140.9 141.7 145.1 LIABILITIES 10 Bank loans 9.7 8.0 6.3 5.9 6.5 7.3 7.8 8.5 9.7 10.1 11 Commercial paper 20.7 22.2 23.7 29.6 34.5 41.0 39.2 43.3 40.8 40.7 Debt 12 Short-term, n.e.c 4.9 4.5 5.4 6.2 8.1 8.8 9.1 8.2 7.4 7.9 13 Long-term n.e.c 26.5 27.6 32.3 36.0 43.6 46.0 47.5 46.7 48.9 50.5 14 Other 5.5 6.8 8.1 11.5 12.6 14.4 15.4 14.2 15.7 16.0 15 Capital, surplus, and undivided profits 12.4 12.5 13.4 15.1 17.2 18.2 18.4 19.9 19.2 19.9 16 Total liabilities and capital 79.6 81.6 89.2 104.3 122.4 135.8 137.4 140.9 141.7 145.1 1. Beginning Q1 1979, asset items on lines 6, 7, and 8 are combined. NOTE. Components may not add to totals due to rounding. 1.53 DOMESTIC FINANCE COMPANIES Business Credit Millions of dollars, seasonally adjusted except as noted Changes in accounts Extensions Repayments receivable AAAccccccooouuunnntttsss rrreeeccceeeiiivvvaaabbbllleee TTTyyypppeee ooouuu AAA ttt uuu sssttt ggg aaa ... nnn 333 ddd 111 iiinnn ,,, ggg 1980 1980 1980 111999888000111 June July Aug. June July Aug. June July Aug. 1 Total 67,064 -336 -599 -412 14,376 15,187 15,545 14,712 15,786 15,957 2 Retail automotive (commercial vehicles) 13,125 -389 -363 -232 782 772 883 1,171 1,135 1,115 3 Wholesale automotive 9,814 -10 -514 -101 4,316 4,338 4,710 4,326 4,852 4,811 4 Retail paper on business, industrial and farm equipment 20,884 -105 295 155 1,201 1,466 1,601 1,306 1,171 11,,444466 5 Loans on commercial accounts receivable and factored commercial accounts receivable . 6,700 -235 -194 -358 6,083 6,479 6,349 6,318 6,673 6,707 6 All other business credit 16,541 403 177 124 1,994 2,132 2,002 1,591 1,955 1,878 l.Not seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A38 DomesticN onfinancial Statistics • November 1980 1.54 MORTGAGE MARKETS Millions of dollars; exceptions noted. 1980 Item 1976 1977 1978 Apr. May June July Aug. Sept. Terms and yields in primary and secondary markets PRIMARY MARKETS Conventional mortgages on new homes Termsx 1 Purchase price (thousands of dollars) 48.4 54.3 62.6 83.1 88.0 81.3 89.0 88.6 2 Amount of loan (thousands of dollars) 35.9 40.5 45.9 59.4 61.3 58.0 63.7 61.5 3 Loan/price ratio (percent) 74.2 76.3 75.3 73.6 72.4 74.1 73.5 71.2 4 Maturity (years) 27.2 27.9 28.0 28.3 28.8 28.4 28.9 27.7 5 Fees and charges (percent of loan amount)2 1.44 1.33 1.39 2.04 2.17 2.21 2.13 2.12 6 Contract rate (percent per annum) 8.76 9.30 12.64 13.26 12.24 12.11 11.84 Yield (percent per annum) 1 FHLBB series5 8.99 9.01 9.54 13.03 13.68 12.66 12.51 12.25 8 HUD series4 8.99 8.95 9.68 15.55 13.20 12.45 12.45 13.25 SECONDARY MARKETS Yield (percent per annum) 9 FHA mortgages (HUD series)5 8.82 9.70 13.45 11.99 11.85 12.39 13.54 10 GNMA securities6 8.17 8.04 8.98 12.55 11.30 11.04 11.53 12.34 FNMA auctions7 11 Government-underwritten loans 8.99 8.73 9.77 14.61 12.87 12.35 12.65 13.92 12 Conventional loans 9.11 10.01 16.29 13.54 12.93 12.80 13.66 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 13 Total 32,904 34,370 43,311 54,843 55,328 55,419 55,362 55,361 55,632 14 FHA-insured 18,916 18,457 21,243 n.a. n.a. n.a. n.a. n.a. n.a. 15 VA-guaranteed 9,212 9,315 10,544 n.a. n.a. n.a. n.a. n.a. n.a. 16 Conventional 4,776 6,597 11,524 17,453 17,858 18,001 18,034 18,049 18,074 Mortgage transactions (during period) 17 Purchases 3,606 4.780 12,303 1,021 589 206 100 167 500 18 Sales 86 67 5 0 0 0 0 0 0 Mortgage commitments8 19 Contracted (during period) 6,247 9,729 18,960 507 391 441 734 1,180 1,070 20 Outstanding (end of period) 3,398 4,698 9,201 4,371 4,064 4,215 4,230 4,545 4,789 Auction of 4-month commitments to buy Government-underwritten loans 21 Offered9 4,929.8 7,974.1 12,978 493.7 608.7 602.5 1,055.6 1,063.3 907.0 22 Accepted 2,787.2 4,846.2 6,747.2 199.4 214.1 266.5 430.3 628.10 538.0 Conventional loans 23 Offered9 2,595.7 5,675.2 9,933.0 135.2 279.7 169.7 228.7 430.4 347.7 24 Accepted 1,879.2 3,917.8 5.110.9 65.8 109.1 76.0 140.9 218.8 209.8 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period)m 25 Total 4,269 3,276 3,064 4,255 4,031 4,014 4,151 4,295 4,543 26 FHA/VA 1,618 1,395 1,243 1,080 1,076 1,072 1,066 1,058 1,050 27 Conventional 2,651 1,881 1,822 3,175 2,955 2,942 3,085 3,237 3,493 Mortgage transactions (during period) 28 Purchases 1,175 3,900 6,524 223311 176 225 440 495 521 29 Sales 1,396 4,131 6,211 199 391 232 288 320 275 Mortgage commitments11 30 Contracted (during period) 1,477 5,546 7,451 189 491 577 708 476 218 31 Outstanding (end of period) 333 1,063 1,410 643 932 1,246 1,386 1,300 934 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 mortinstitutional 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 A39 1.55 . MORTGAGE DEBT OUTSTANDING Millions of dollars, end of period 1979 1980 TTyyppee ooff hhoollddeerr,, aanndd ttyyppee ooff pprrooppeerrttyy 11997777 11997788 11997799 Q2 Q3 Q4 Q1 Q2 1 All holders 1,023,505 1,172,754 1,333,550 1,252,426 1,295,935 1,333,550 1,363,787 1,386,344 2 1- to 4-family 656,566 761,843 872.068 816,940 846,287 872,068 890,121 904,226 3 Multifamily 111,841 121,972 130.713 125,916 128,270 130,713 132,795 133,646 4 Commercial 189,274 212,746 238.412 224,499 232,208 238,412 243,839 247,085 5 65,824 76,193 92,357 85,071 89,170 92,357 97,032 101,387 6 Major financial institutions 745,011 848,095 939,487 894,385 920,231 939,487 951,898 958,887 7 Commercial banks1 178,979 213,963 245,998 229,564 239,627 245,998 251,198 253,098 8 1- to 4-family 105,115 126,966 145,975 136,223 142,195 145,975 149,061 150,188 9 Multifamily 9,215 10,912 12,546 11,708 12,221 12,546 12,811 12,908 10 Commercial 56,898 67,056 77,096 71,945 75,099 77,096 78,725 79,321 11 Farm 7,751 9,029 10,381 9,688 10,112 10,381 10,601 10,681 12 Mutual savings banks 88,104 95,157 98,908 97,155 97,929 98,908 99,151 99,150 13 1- to 4-family 57,637 62,252 64,706 63,559 64,065 64,706 64,865 64,864 14 Multifamily 15,304 16,529 17,180 16,876 17,010 17,180 17,223 17,223 15 Commercial 15,110 16,319 16,963 16,662 16,795 16,963 17,004 17,004 16 Farm 53 57 59 58 59 59 59 59 17 Savings and loan associations 381,163 432,808 475,797 456,543 468,307 475,797 479,078 481,184 18 1- to 4-family 310,686 356,114 394.436 377,516 387,992 394,436 398,114 398,864 19 Multifamily 32,513 36,053 37,588 37,071 37,277 37,588 37,224 37,340 20 Commercial 37,964 40,641 43,773 41,956 43,038 43,773 43,740 43,980 21 Life insurance companies 96,765 106,167 118,784 111,123 114,368 118,784 122,471 125,455 22 1- to 4-family 14,727 14,436 16,193 14,489 14,884 16,193 16,850 17,796 23 Multifamily 18,807 19,000 19,274 19,102 19,107 19,274 19,590 19,284 24 Commercial 54,388 62,232 71,137 66,055 68,513 71,137 73,618 75,693 25 Farm 8,843 10,499 12,180 11,477 11,864 12,180 12,413 12,682 26 Federal and related agencies 70,006 81,853 97,293 90,095 93,143 97,293 104,133 108,742 27 Government National Mortgage Association 3,660 3,509 3,852 3,425 3,382 3,852 3,919 4,466 28 1- to 4-family 1,548 877 763 800 780 763 749 736 29 Multifamily 2,112 2,632 3,089 2,625 2,602 3,089 3,170 3,730 30 Farmers Home Administration 1,353 926 1,274 1,200 1,383 1,274 2,845 3,375 31 1- to 4-family 626 288 417 363 163 417 1,139 1,383 32 Multifamily 275 320 71 75 299 71 408 636 33 Commercial 149 101 174 278 262 174 409 402 34 Farm 303 217 612 484 659 612 889 954 35 Federal Housing and Veterans Administration 5,212 5,419 5,764 5,597 5,672 5,764 5,833 5,894 36 1- to 4-family 1,627 1,641 1,863 1,744 1,795 1,863 1,908 1,953 37 Multifamily 3,585 3,778 3,901 3,853 3,877 3,901 3,925 3,941 38 Federal National Mortgage Association 34,369 43,311 51,091 48,206 49,173 51,091 53,990 55,419 39 1- to 4-family 28,504 37,579 45,488 42,543 43,534 45,488 48,394 49,837 40 Multifamily 5,865 5,732 5,603 5,663 5,639 5,603 5,596 5,582 41 Federal Land Banks 22,136 25,624 31,277 28,459 29,804 31,277 33,311 35,574 42 1- to 4-family 670 927 1,552 1,198 1,374 1,552 1,708 1,893 43 Farm 21,466 24,697 29,725 27,261 28,430 29,725 31,603 33,681 44 Federal Home Loan Mortgage Corporation 3,276 3,064 4,035 3,208 3,729 4,035 4,235 4,014 45 1- to 4-family 2,738 2,407 3,059 2,489 2,850 3,059 3,210 3,037 46 Multifamily 538 657 976 719 879 976 1,025 977 47 Mortgage pools or trusts2 70,289 88,633 119,278 102,259 110,648 119,278 124,632 129,647 48 Government National Mortgage Association 44,896 54,347 76,401 63,000 69,357 76,401 80,843 84,282 49 1- to 4-family 43,555 52,732 74,546 61,246 67,535 74,546 78,872 82,208 50 Multifamily 1,341 1,615 1,855 1,754 1,822 1,855 1,971 2,074 51 Federal Home Loan Mortgage Corporation 6,610 11,892 15,180 13,708 14,421 15,180 15,454 16,120 52 1- to 4-family 5,621 9,657 12,149 11,096 11,568 12,149 12,359 12,886 53 Multifamily 989 2,235 3,031 2,612 2,853 3,031 3,095 3,234 54 Farmers Home Administration 18,783 22,394 27,697 25,551 26,870 27,697 28,335 29,245 55 1- to 4-family 11,397 13,400 14,884 14,329 14,972 14,884 14,926 15,224 56 Multifamily 759 1,116 2,163 1,764 1,763 2,163 2,159 2,159 57 Commercial 2,945 3,560 4,328 3,833 4,054 4,328 4,495 4,763 58 Farm 3,682 4,318 6,322 5,625 6,081 6,322 6,755 7,099 59 Individual and others3 138,199 154,173 177,492 165,687 171,913 177,492 183,153 189,068 60 1- to 4-family 72,115 82,567 96,037 89,345 92,580 96,037 99,012 102,357 61 Multifamily 20,538 21,393 23,436 22,094 22,921 23,436 23,936 24,558 62 Commercial 21,820 22,837 24,941 23,770 24,447 24,941 25,493 25,922 63 Farm 23,726 27,376 33,078 30,478 31,965 33,078 34,712 36,231 1. Includes loans held by nondeposit trust companies but not bank trust de- NOTE. Based on data from various institutional and governmental sources, with partments. 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, terpolations and extrapolations when required, are estimated mainly by the Federal state 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

A40 Domestic Nonfinancial Statistics • November 1980 1.56 CONSUMER INSTALLMENT CREDIT' Total Outstanding, and Net Change Millions of dollars 1980 HHoollddeerr,, aanndd ttyyppee ooff ccrreeddiitt 1977 1978 1979 Mar. Apr. May June July Aug. Sept. Amounts outstanding (end of period) 1 Total 230,829 275,629 311,122 307,621 306,131 303,759 301,378 301,754 303,263 304,707 B\ major holder 2 Commercial banks 112,373 136,189 149,604 147,315 145,405 143,174 140,922 140,489 140,790 141,037 3 Finance companies 44,868 54,298 68.318 70,421 71,545 72,101 73,118 73,909 74,433 74,823 4 Credit unions 37,605 45,939 48,186 46,521 45,731 44,907 43,740 43,390 43,347 43,562 5 Retailers2 23,490 24,876 27,916 25,841 25,746 25,792 25,724 25,707 26,065 26,372 6 Savings and loans 7,354 8,394 10,361 10,755 10,887 10,930 10,995 11,204 11,390 11,548 7 Gasoline companies 2,963 3,240 4,316 4,421 4,503 4,581 4,664 4,888 5,102 5,205 8 Mutual savings banks 2,176 2,693 2,421 2,347 2,314 2,274 2,215 2,167 2,136 2,160 Bv major type of credit 9 Automobile 82,911 102,468 115,022 115,281 115,014 114,318 113,174 113,604 114,061 114,334 10 Commercial banks 49,577 60,564 65,229 64,047 62,978 61,928 60,584 60,466 60,370 60,287 11 Indirect paper 27,379 33,850 37,209 36,821 36,325 35,791 34,929 34,704 34,630 34,612 12 Direct loans 22,198 26,714 28,020 27,226 26,653 26,137 25,655 25,762 25,740 25,675 13 Credit unions 18,099 21,967 23,042 22,246 21,868 21,474 20,916 20,749 20,728 20,831 14 Finance companies 15,235 19,937 26.751 28,988 30,168 30,916 31,674 32,389 32,963 33,216 15 Revolving 39,274 47,051 55,330 52,662 52,217 51,823 51,246 51,330 52,126 52,651 16 Commercial banks 18,374 24,434 28,954 28,241 27,889 27,456 26,926 26,841 27,114 27,252 17 Retailers 17,937 19,377 22,060 20,000 19,825 19,786 19,656 19,601 19,910 20,194 18 Gasoline companies 2,963 3,240 4,316 4,421 4,503 4,581 4,664 4,888 5,102 5,205 19 Mobile home 15,141 16,042 17,409 17,596 17,668 17,642 17,779 17,809 17,860 17,928 20 Commercial banks 9,124 9,553 9,991 9,978 9,965 9,927 10,039 10,000 9,968 9,945 21 Finance companies 3,077 3,152 3,390 3,475 3,523 3,529 3,544 3,546 3,566 3,601 22 Savings and loans 2,538 2,848 3,516 3,650 3,694 3,709 3,731 3,802 3,865 3,919 23 Credit unions 402 489 512 494 486 477 465 461 461 463 24 Other 93,503 110,068 123,361 122,082 121,232 119,976 119,179 119,011 119,216 119,794 25 Commercial banks 35,298 41,638 45.430 45,049 44,573 43,863 43,373 43,182 43,338 43,553 26 Finance companies 26,556 31,209 38.177 37,958 37,854 37,656 37,900 37,974 37,904 38,006 27 Credit unions 19,104 23,483 24,632 23,781 23,377 22,956 22,359 22,180 22,158 22,268 28 Retailers 5,553 5,499 5,856 5,841 5,921 6,006 6,068 6,106 6,155 6,178 29 > Savings and loans 4,816 5,546 6,845 7,106 7,193 7,221 7,264 7,402 7,525 7,629 30 Mutual savings banks 2,176 2,693 2,421 2,347 2,314 2,274 2,215 2,167 2,136 2,160 Net change (during period)3 31 Total 35,278 44,810 35,491 1,437 -1,985 -3,434 -3,463 -609 15 1,450 By major holder 32 Commercial banks 18,645 23,813 13,414 17 -2,237 -2,495 -2,659 -972 -433 168 33 Finance companies 5,948 9,430 14,020 1.174 984 105 625 418 495 628 34 Credit unions 6,436 8,334 2,247 -215 -743 -977 -1,362 -381 -303 12 35 Retailers2 2,654 1,386 3,040 243 -65 -58 -108 140 112 424 36 Savings and loans 1,111 1,041 1,967 204 83 75 89 196 76 182 37 Gasoline companies 132 276 1,076 48 14 -42 8 36 101 30 38 Mutual savings banks 352 530 -273 -34 -21 -42 -56 -46 -33 6 By major type of credit 39 Automobile 15,204 19,557 12,554 395 -645 -1,343 -1,738 -93 174 443 40 Commercial banks 9,956 10,987 4,665 -412 -1,335 -1,246 -1,519 -413 -263 23 41 Indirect paper 5,307 6,471 3,359 -86 -698 -626 -945 -365 -187 12 42 Direct loans 4,649 4,516 1,306 -326 -637 -620 -574 -48 -76 11 43 Credit unions 2,861 3,868 1,075 -82 -373 -482 -660 -175 -152 -3 44 Finance companies 2,387 4,702 6,814 889 1,063 385 441 495 589 423 45 Revolving 6,248 7,776 8,279 611 -388 -488 -748 14 142 346 46 Commercial banks 4,015 6,060 4,520 395 -260 -308 -562 -131 -30 -66 47 Retailers 2,101 1,440 2,683 168 -142 -138 -194 109 71 382 48 Gasoline companies 132 276 1,076 48 14 -42 8 36 101 30 49 Mobile home 565 897 1,366 128 36 -33 97 26 -8 50 50 Commercial banks 387 426 437 17 -30 -54 74 -43 -52 -29 51 Finance companies -189 74 238 57 41 5 13 -6 18 28 52 Savings and loans 297 310 668 57 33 23 23 78 29 51 53 Credit unions 70 87 23 -3 -8 -7 -13 -3 -3 0 54 Other 13,261 16,580 13,292 303 -988 -1,570 -1,074 -556 -293 611 55 Commercial banks 4,287 6,340 3,792 17 -612 -887 -652 -385 -88 240 56 Finance companies 3,750 4,654 6,968 228 -120 -285 171 -71 -112 177 57 Credit unions 3,505 4,379 1,149 -130 -362 -488 -689 -203 -148 15 58 Retailers 553 -54 357 75 77 80 86 31 41 42 59 Savings and loans 814 731 1,299 147 50 52 66 118 47 131 60 Mutual savings banks 352 530 -273 -34 -21 -42 -56 -46 -33 6 1. 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 A41 1.57 CONSUMER INSTALLMENT CREDIT Extensions and Liquidations Millions of dollars; monthly data are seasonally adjusted. 1980 HHoollddeerr,, aanndd ttyyppee ooff ccrreeddiitt 1977 1978 1979 Mar. Apr. May June July Aug. Sept. Extensions 1 Total 254,071 298,351 322,558 26,620 22,548 21,239 20,698 24,497 25,601 27,308 Bv major holder 2 Commercial banks 117.896 142,720 149.599 11,315 9,338 8,812 8,574 10.548 10,893 11,905 3 Finance companies 41.989 50,505 61.518 5.700 4,841 4,304 4,324 4,888 5,204 5,359 4 Credit unions 34.028 40,023 36,778 2.501 1,865 1,615 1,302 2,267 2,354 2,733 5 Retailers1 39.133 41,619 46,092 4.358 3,870 3,880 3,881 4.032 4,375 4,422 6 Savings and loans 4,485 5,050 7,333 665 555 536 576 711 605 726 7 Gasoline companies 14,617 16,125 19,607 1,987 1,978 2,011 1,971 1,971 2,078 2,033 8 Mutual savings banks 1,923 2,309 1,631 94 101 81 70 80 92 130 Bv major type of credit y Automobile 75,641 88,987 91,847 7,240 5.725 5,192 4.770 6.609 6,964 7,718 10 Commercial banks 46,363 53,028 50,596 3.394 2,398 2,354 2,160 3,239 3,499 3,928 u Indirect paper 25.149 29,336 28,183 1.978 1,433 1,353 1,092 1.645 1,895 2,124 12 Direct loans 21.214 23,692 22,413 1.416 965 1,001 1,068 1,594 1,604 1,804 13 Credit unions 16,616 19,486 18,301 1.306 962 838 708 1.178 1,224 1,444 14 Finance companies 12,662 16,473 22,950 2.540 2,365 2,000 1,902 2.192 2,241 2,346 15 Revolving 86,756 104,587 120.728 11.038 10,293 10,089 9.635 10,522 10,652 10,897 16 Commercial banks 38,256 51,531 60.406 5.200 4,929 4,745 4.342 4,974 4,785 5,005 17 Retailers 33,883 36,931 40.715 3.851 3,386 3,333 3,322 3.577 3,789 3,859 18 Gasoline companies 14.617 16,125 19.607 1.987 1,978 2,011 1,971 1.971 2,078 2,033 19 Mobile home 5.425 6,067 6.395 506 436 324 464 421 387 485 20 Commercial banks 3,466 3,704 3.720 263 220 166 302 195 202 230 21 Finance companies 643 886 797 90 84 52 53 49 59 84 22 Savings and loans 1.120 1,239 1,687 143 128 103 110 169 117 158 23 Credit unions 196 238 191 10 4 3 -1 8 9 13 24 Other 86,249 98,710 103,588 7.836 6.094 5,634 5,829 6.945 7,598 8,208 25 Commercial banks 29,811 34,457 34,877 2.458 1,791 1,547 1,770 2.140 2,407 2,742 26 Finance companies 28,684 33,146 37,771 3.070 2,392 2,252 2,369 2.647 2,904 2,929 27 Credit unions 17,216 20,299 18,286 1,185 899 774 595 1.081 1,121 1,276 28 Retailers 5,250 4.688 5,377 507 484 547 559 455 586 563 29 Savings and loans 3,365 3.811 5,646 522 427 433 466 542 488 568 30 Mutual savings banks 1.923 2,309 1,631 94 101 81 70 80 92 130 Liquidations 31 Total 218,793 253,541 287,067 25,183 24,533 24,673 24,161 25,106 25,586 25,858 By major holder 32 Commercial banks 99,251 118,907 136,185 11.298 11,575 11,307 11.233 11.520 11,326 11,737 33 Finance companies 36,041 41,075 47,498 4.526 3.857 4.199 3.699 4.470 4,709 4,731 34 Credit unions 27,592 31,689 34,531 2.716 2,608 2,592 2,664 2.648 2,657 2,721 35 Retailers' 36,479 40,233 43,052 4.115 3,935 3,938 3,989 3,892 4,263 3,998 36 Savings and loans 3,374 4,009 5,366 461 472 461 487 515 529 544 37 Gasoline companies 14,485 15,849 18,531 1.939 1.964 2,053 1.963 1.935 1,977 2,003 38 Mutual savings banks 1,571 1,779 1,904 128 122 123 126 126 125 124 By major type of credit 39 Automobile 60,437 69,430 79,293 6.845 6,370 6,535 6.508 6.702 6,790 7,275 40 Commercial banks 36,407 42,041 45.931 3.806 3.733 3,600 3.679 3.652 3,762 3,905 41 Indirect paper 19,842 22,865 24,824 2.064 2.131 1,979 2,037 2.010 2,082 2,112 42 Direct loans 16,565 19,176 21,107 1,742 1,602 1,621 1,642 1.642 1,680 1,793 43 Credit unions 13,755 15,618 17,226 1.388 1,335 1,320 1,368 1.353 1,376 1,447 44 Finance companies 10,275 11,771 16,136 1.651 1,302 1,615 1,461 1.697 1,652 1,923 45 Revolving 80,508 96,811 112.449 10,427 10.681 10,577 10,383 10,508 10,510 10,551 46 Commercial banks 34.241 45,471 55,886 4.805 5,189 5,053 4.904 5,105 4,815 5,071 47 Retailers 31,782 35,491 38,032 3.683 3.528 3,471 3.516 3.468 3,718 3,477 48 Gasoline companies 14,485 15,849 18,531 1.939 1,964 2,053 1,963 1.935 1,977 2,003 49 Mobile home 4,860 5,170 5.029 378 400 357 367 395 395 435 50 Commercial banks 3,079 3,278 3.283 246 250 220 228 238 254 259 51 Finance companies 832 812 559 33 43 47 40 55 41 56 52 Savings and loans 823 929 1,019 86 95 80 87 91 88 107 53 Credit unions 126 151 168 13 12 10 12 11 12 13 54 Other 72,988 82,130 90.296 7,533 7,082 7,204 6,903 7.501 7.891 7,597 55 Commercial banks 25,524 28,117 31.085 2,441 2,403 2,434 2,422 2,525 2,495 2,502 56 Finance companies 24,934 28,492 30,803 2,842 2,512 2,537 2,198 2.718 3,016 2,752 57 Credit unions 13,711 15,920 17,137 1.315 1,261 1,262 1,284 1.284 1,269 1,261 58 Retailers 4.697 4,742 5,020 432 407 467 473 424 545 521 59 Savings and loans 2,551 3,080 4,347 375 377 381 400 424 441 437 60 Mutual savings banks 1.571 1,779 1.904 128 122 123 126 126 125 124 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

A42 Domestic Nonfinancial Statistics • November 1980 1.58 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1977 1978 1979 1980 TTrraannssaaccttiioonn ccaatteeggoorryy,, sseeccttoorr 1974 1975 1976 1977 1978 1979 H2 HI H2 HI H2 HI Nonfinancial sectors 1 Total funds raised 191.3 210.8 271.9 338.5 400.3 394.9 378.9 384.5 416.1 380.5 408.2 311.8 2 Excluding equities 187.4 200.7 261.1 335.4 398.2 390.6 373.8 387.1 409.3 377.7 402.3 303.6 Bv sector and instrument 3 U.S. government 11.8 85.4 69.0 56.8 53.7 37.4 67.4 61.4 46.0 28.6 46.1 63.2 4 Treasury securities 12.0 85.8 69.1 57.6 55.1 38.8 68.6 62.3 47.9 30.9 46.6 63.8 5 Agency issues and mortgages -.2 -.4 -.1 -.9 -1.4 -1.4 -1.2 -.9 -1.9 -2.3 -.5 -.6 6 All other nonfinancial sectors 179.5 125.4 202.9 281.8 346.6 357.6 311.5 323.1 370.2 351.9 362.1 248.6 7 Corporate equities 3.8 10.1 10.8 3.1 2.1 4.3 5.1 -2.6 6.8 2.8 5.9 8.2 8 Debt instruments 175.6 115.3 192.0 278.6 344.5 353.2 306.4 325.7 363.4 349.1 356.2 240.4 9 Private domestic nonfinancial sectors 164.1 112.1 182.0 267.9 314.4 336.4 294.2 302.5 326.3 338.6 333.0 223.9 10 Corporate equities 4.1 9.9 10.5 2.7 2.6 3.5 4.9 -1.8 7.0 2.8 4.1 6.1 11 Debt instruments 160.0 102.1 171.5 265.1 311.8 333.0 289.3 304.3 319.2 335.8 328.9 217.9 12 Debt capital instruments 98.0 98.4 123.5 175.6 196.6 199.9 192.5 188.0 205.1 198.8 201.1 167.0 13 State and local obligations 16.5 16.1 15.7 23.7 28.3 18.9 25.0 27.8 28.7 16.0 21.8 19.0 14 Corporate bonds 19.7 27.2 22.8 21.0 20.1 21.2 25.4 20.6 19.6 22.4 19.9 32.9 Mortgages 15 Home 34.8 39.5 63.7 96.4 104.5 109.1 103.1 99.8 109.2 109.8 108.5 72.7 16 Multifamily residential 6.9 * 7.4 10.2 8.9 8.4 9.3 11.2 8.1 9.7 7.9 17 Commercial 15.1 11.0 13^4 18.4 23.3 25.7 21.9 21.2 25.4 26.0 25.4 20.5 18 Farm 5.0 4.6 8.8 10.2 16.2 8.7 9.3 11.1 16.6 15.9 14.1 19 Other debt instruments 62.0 3.8 48^0 89.5 115.2 133.0 96.7 116.3 114.1 137.0 127.8 50.9 20 Consumer credit 9.9 9.7 25.6 40.6 50.6 44.2 44.5 50.1 51.0 48.3 39.0 -9.2 21 Bank loans n.e.c 31.7 -12.3 4.0 27.0 37.3 50.6 26.7 43.1 31.4 48.2 52.9 9.8 22 Open market paper 6.6 -2.6 4.0 2.9 5.2 10.9 2.4 5.3 5.1 12.0 9.7 30.0 23 Other 13.7 9.0 14.4 19.0 22.2 27.3 23.2 17.8 26.5 28.4 26.2 20.2 24 By borrowing sector 164.1 112.1 182.0 267.9 314.4 336.4 294.2 302.5 326.3 338.6 333.0 223.9 25 State and local governments 15.5 13.7 15.2 20.4 23.6 15.5 25.0 21.0 26.1 13.0 18.0 16.6 26 Households 51.2 49.5 90.7 139.9 162.6 165.0 150.4 156.1 169.1 168.1 161.0 78.9 27 Farm 8.0 8.8 10.9 14.7 18.1 25.8 13.8 15.3 20.8 23.5 28.1 21.6 28 Nonfarm noncorporate 7.7 2.0 5.4 12.5 15.4 15.8 12.5 16.3 14.5 15.3 16.0 11.8 29 Corporate 81.7 38.1 59.8 80.3 94.7 114.3 92.4 93.7 95.8 118.7 109.8 95.0 30 Foreign 15.4 13.3 20.8 13.9 32.3 21.1 17.3 20.6 43.9 13.3 29.1 24.7 31 Corporate equities -.2 .2 .3 .4 -.5 .9 .2 -.8 -.2 * 1.7 2.2 32 Debt instruments 15.7 13.2 20.5 13.5 32.8 20.3 17.1 21.4 44.1 13.3 27.3 22.5 33 Bonds 2.1 6.2 8.6 5.1 4.0 3.9 5.7 5.0 3.0 3.0 4.7 2.2 34 Bank loans n.e.c 4.7 3.9 6.8 3.1 18.3 2.3 6.5 9.3 27.3 1.0 3.5 -1.6 35 Open market paper 7.3 .3 1.9 2.4 6.6 11.2 2.2 3.6 9.6 6.1 16.3 16.2 36 U.S. government loans 1.6 2.8 3.3 3.0 3.9 3.0 2.9 3.6 4.2 3.1 2.8 5.7 Financial sectors 37 Total funds raised 39.2 12.7 24.1 54.0 81.4 87.4 60.3 80.7 82.1 87.0 87.8 47.7 By instrument 38 U.S. government related 23.1 13.5 18.6 26.3 41.4 52.4 29.9 38.5 44.3 45.8 59.0 41.0 39 Sponsored credit agency securities 16.6 2.3 3.3 7.0 23.1 24.3 6.8 21.9 24.3 21.5 27.0 25.2 40 Mortgage pool securities 5.8 10.3 15.7 20.5 18.3 28.1 23.1 16.6 20.1 24.2 32.0 15.7 41 Loans from U.S. government .7 .9 -.4 -1.2 0 0 0 0 0 0 0 0 42 Private financial sectors 16.2 -.8 5.5 27.7 40.0 35.0 30.4 42.2 37.8 41.2 28.8 6.7 43 Corporate equities .3 .6 1.0 .9 1.7 1.2 .8 2.2 1.1 2.8 -.4 2.6 44 Debt instruments 15.9 - 1.4 4.4 26.9 38.3 33.8 29.6 40.0 36.7 38.4 29.2 4.1 45 Corporate bonds 2.1 2.9 5.8 10.1 7.5 7.8 10.1 8.5 6.4 8.7 7.0 10.3 46 Mortgages -1.3 2.3 2.1 3.1 .9 -1.2 3.0 2.1 -.3 -.5 -1.9 -6.7 47 Bank loans n.e.c 4.6 -3.7 -3.7 -.3 2.8 -.4 1.2 2.5 3.1 -.7 -.2 * 48 Open market paper and repurchase agreements 3.8 1.1 2.2 9.6 14.6 18.4 9.5 13.5 15.7 23.0 13.8 -3.5 49 Loans from Federal Home Loan Banks 6.7 -4.0 -2.0 4.3 12.5 9.2 5.8 13.2 11.8 7.8 10.5 4.1 By sector 50 Sponsored credit agencies 17.3 3.2 2.6 5.8 23.1 24.3 6.8 21.9 24.3 21.5 27.0 25.2 51 Mortgage pools 5.8 10.3 15.7 20.5 18.3 28.1 23.1 16.6 20.1 24.2 32.0 15.7 52 Private financial sectors 16.2 -.8 5.5 27.7 40.0 35.0 30.4 42.2 37.8 41.2 28.8 6.7 53 Commercial banks 1.2 1.2 2.3 1.1 1.3 1.6 1.5 1.5 1.1 1.3 1.8 1.9 54 Bank affiliates 3.5 .3 -.8 1.3 6.7 4.5 1.2 5.8 7.6 6.2 2.9 4.5 55 Savings and loan associations 4.8 -2.3 .1 9.9 14.3 11.4 11.5 16.4 12.2 9.9 12.9 -2.9 56 Other insurance companies .9 1.0 .9 .9 1.1 1.0 1.0 1.0 1.1 1.0 .9 .8 57 Finance companies 6.0 .5 6.4 17.6 18.6 18.9 18.5 18.9 18.2 23.5 14.3 3.3 58 REITs .6 -1.4 -2.4 -2.2 -1.0 -.4 -2.0 -1.0 -1.0 -.6 -.1 -.5 59 Open-end investment companies -.7 -.1 -1.0 -.9 -1.0 -2.1 -1.3 -.5 -1.5 -.3 -3.9 -.3 60 Total funds raised, by instrument 230.5 223.5 296.0 392.5 481.7 482.3 439.2 465.2 498.3 467.4 496.0 359.5 61 Investment company shares -.7 -.1 -10 -.9 -1.0 -2.1 -1.3 -.5 -1.5 -.3 -3.9 -.3 62 Other corporate equities 4.8 10.8 12.9 4.9 4.7 7.6 7.2 .1 9.4 5.8 9.3 11.1 63 Debt instruments 226.4 212.8 284.1 388.5 478.0 476.8 433.3 465.5 490.4 461.9 490.5 348.7 64 U.S. government securities 34.3 98.2 88.1 84.3 95.2 89.9 97.4 100.0 90.4 74.5 105.2 104.3 65 State and local obligations 16.5 16.1 15.7 23.7 28.3 18.9 25.0 27.8 28.7 16.0 21.8 19.0 66 Corporate and foreign bonds 23.9 36.4 37.2 36.1 31.6 32.9 41.1 34.2 29.1 34.1 31.5 45.4 67 Mortgages 60.5 57.2 87.1 134.0 149.0 158.6 145.1 141.6 156.4 159.8 157.4 108.3 68 Consumer credit 9.9 9.7 25.6 40.6 50.6 44.2 44.5 50.1 51.0 48.3 39.0 -9.2 69 Bank loans n.e.c 41.0 -12.2 7.0 29.8 58.4 52.5 34.4 54.9 61.8 48.6 56.2 8.3 70 Open market paper and RPs 17.7 -1.2 8.1 15.0 26.4 40.5 14.0 22.4 30.4 41.1 39.8 42.6 Digitized for FRA7S1 ERO ther loans 22.7 8.7 15.3 25.2 38.6 39.5 31.8 34.6 42.5 39.4 39.5 30.0 http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A43 1.59 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 1980 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 11997744 11997755 11997766 11997777 11997788 11997799 H2 HI H2 HI H2 HI 1 Total funds advanced in credit markets to nonfinancial sectors 187.4 200.7 261.1 355.4 398.2 390.6 373.8 387.1 409.3 377.7 402.3 303.6 Bv public agencies and foreign 2 Total net advances 53.7 44.6 54.3 85.1 109.7 80.1 104.2 102.8 116.6 47.6 112.5 105.1 3 U.S. government securities 11.9 22.5 26.8 40.2 43.9 2.0 53.3 43.7 44.0 -22.1 26.2 27.4 4 Residential mortgages 14.7 16.2 12.8 120.4 26.5 36.1 22.0 22.2 30.7 32.6 39.6 34.0 5 FHLB advances to savings and loans 6.7 -4.0 -2.0 4.3 12.5 9.2 5.8 13.2 11.8 7.8 10.5 4.1 6 Other loans and securities 20.5 9.8 16.6 20.2 26.9 32.8 23.1 23.7 30.1 29.2 36.3 39.7 Total advanced, bv sector 7 U.S. government 9.8 15.1 8.9 11.8 20.4 22.5 17.8 19.4 21.4 23.8 21.3 34.5 8 Sponsored credit agencies 26.5 14.8 20.3 26.8 44.6 57.5 32.0 39.4 49.8 49.9 65.2 40.5 9 Monetary authorities 6.2 8.5 9.8 7.1 7.0 7.7 4.0 13.4 .5 .9 14.5 13.6 10 Foreign 11.2 6.1 15.2 39.4 37.7 -7.7 50.4 30.6 44.9 -27.0 11.7 16.6 11 Agency borrowing not included in line 1 23.1 13.5 18.6 26.3 41.4 52.4 29.9 38.5 44.3 45.8 59.0 41.0 Private domestic funds advanced 12 Total net advances 156.8 169.7 225.4 276.5 330.0 362.9 299.6 322.8 337.1 375.9 348.8 239.4 13 U.S. government securities 22.4 75.7 61.3 44.1 51.3 87.9 44.1 56.3 46.4 96.6 79.1 76.9 14 State and local obligations 16.5 16.1 15.7 23.7 28.3 18.9 25.0 27.8 28.7 16.0 21.8 19.0 15 Corporate and foreign bonds 20.9 32.8 30.5 22.5 22.5 25.6 27.0 24.1 20.9 26.9 24.3 30.9 16 Residential mortgages 26.9 23.2 52.7 83.3 88.2 81.8 89.4 86.7 89.6 85.1 78.5 46.4 17 Other mortgages and loans 76.8 17.9 63.3 107.3 152.2 157.9 119.7 141.1 163.3 159.1 155.6 70.3 18 LESS: Federal Home Loan Bank advances 6.7 -4.0 -2.0 4.3 12.5 9.2 5.8 13.2 11.8 7.8 10.5 4.1 Private financial intermediation 19 Credit market funds advanced by private financial institutions 125.5 122.5 190.3 255.9 296.9 291.4 265.0 301.7 292.0 308.2 274.5 213.3 20 Commercial banking 66.6 29.4 59.6 87.6 128.7 121.1 90.7 132.5 125.0 124.6 117.6 44.5 21 Savings institutions 24.2 53.5 70.8 82.0 75.9 56.3 82.6 75.8 75.9 57.7 54.9 32.7 22 Insurance and pension funds 29.8 40.6 49.9 67.9 73.5 70.4 70.6 76.9 70.2 75.4 65.5 78.9 23 Other finance 4.8 -1.0 10.0 18.4 18.7 43.6 21.2 16.6 20.8 50.6 36.6 57.2 24 Sources of funds 125.5 122.5 190.3 255.9 296.9 291.4 265.0 301.7 292.0 308.2 274.5 213.3 25 Private domestic deposits 67.5 92.0 124.6 141.2 142.5 136.7 143.8 138.3 146.7 121.7 151.6 132.6 26 Credit market borrowing 15.9 -1.4 4.4 26.9 38.3 33.8 29.6 40.0 36.7 38.4 29.2 4.1 27 Other sources 42.1 32.0 61.3 87.8 116.0 120.9 91.7 123.5 108.6 148.1 93.7 76.6 28 Foreign funds 10.3 -8.7 -4.6 1.2 6.3 26.3 .8 5.7 6.9 49.4 3.2 -10.7 29 Treasury balances -5.1 -1.7 -.1 4.3 6.8 .4 8.5 1.9 11.6 5.1 -4.3 -1.9 30 Insurance and pension reserves 26.2 29.7 34.5 49.4 62.7 49.0 53.4 66.2 59.2 53.9 44.0 53.2 31 Other, net 10.6 12.7 31.4 32.9 40.3 45.2 29.0 49.6 31.0 39.6 50.8 36.0 Private domestic nonfinancial investors 32 Direct lending in credit markets 47.2 45.8 39.5 47.5 71.4 105.4 64.1 61.1 81.7 106.1 103.5 30.3 33 U.S. government securities 18.9 24.1 16.1 23.0 33.2 57.8 34.2 32.1 34.4 64.1 51.5 12.3 34 State and local obligations 9.3 8.4 3.8 2.6 4.5 -2.5 5.7 7.0 2.0 -2.3 -2.7 -3.0 35 Corporate and foreign bonds 5.1 8.4 5.8 -3.3 -1.4 12.2 -6.5 -3.7 1.0 7.1 17.2 7.9 36 Commercial paper 5.8 -1.3 1.9 9.5 16.3 10.7 10.8 8.2 24.4 12.5 9.0 -8.6 37 Other 8.0 6.2 11.8 15.7 18.7 27.1 19.9 17.5 20.0 24.7 28.5 21.7 38 Deposits and currency 73.8 98.1 131.9 149.5 151.8 144.7 154.5 148.7 154.8 131.1 158.1 141.3 39 Security RPs -2.2 .2 2.3 2 2 7.5 6.6 .2 9.8 5.1 18.5 -5.3 -8.3 40 Money market fund shares 2.4 1.3 * 6.9 34.4 .9 6.1 7.7 30.2 38.6 61.9 41 Time and savings accounts 65.4 84.0 113.5 121.0 115.2 84.7 126.7 110.7 119.8 71.4 97.9 89.7 42 Large at commercial banks 32.4 -15.8 -13.2 23.0 45.9 .4 49.6 33.9 57.9 -25.3 26.0 -5.1 43 Other at commercial banks 11.3 40.3 57.6 29.0 8.2 39.3 11.4 18.4 -1.9 41.3 37.3 52.9 44 At savings institutions 21.8 59.4 69.1 69.0 61.1 45.1 65.7 58.5 63.8 55.4 34.7 41.8 45 Money 8.2 12.6 16.1 26.1 22.2 18.9 26.8 22.1 22.3 10.9 26.8 -2.1 46 Demand deposits 1.9 6.4 8.8 17.8 12.9 11.0 16.1 11.6 14.2 1.6 20.3 -10.8 47 Currency 6.3 6.2 7.3 8.3 9.3 7.9 10.8 10.5 8.1 9.3 6.5 8.7 48 Total of credit market instruments, deposits and currency 121.0 143.9 171.4 197.0 223.2 250.0 218.6 209.8 236.6 237.1 261.6 171.5 49 Public support rate (in percent) 28.7 22.2 20.8 25.4 27.5 20.5 27.9 26.5 28.5 12.6 28.0 34.6 50 Private financial intermediation (in percent) 80.0 72.2 84.4 92.5 90.0 80.3 88.5 93.5 86.6 82.0 78.7 89.1 51 Total foreign funds 21.5 -2.6 10.6 40.5 44.0 18.6 51.2 36.3 51.8 22.4 14.9 5.9 MEMO: Corporate equities not included above 52 Total net issues 4.1 10.7 11.9 4.0 3.7 5.5 5.9 -.4 7.9 5.5 5.4 10.8 53 Mutual fund shares -.7 -.1 -1.0 -.9 -1.0 -2.1 -1.3 -.5 -1.5 -.3 -3.9 -.3 54 Other equities 4.8 10.8 12.9 4.9 4.7 7.6 7.2 .1 9.4 5.8 9.3 11.1 55 Acquisitions by financial institutions 5.8 9.6 12.3 7.4 7.6 15.7 8.1 .4 14.7 12.5 18.9 18.4 56 Other net purchases -1.7 1.1 -.4 -3.4 -3.8 -10.2 -2.2 -.8 -6.8 -7.0 -13.5 -7.6 NOTES BY LINE NUMBER. 30. Excludes net investment of these reserves in corporate equities. 1. Line 2 of p. A-42. 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 47. Mainly an offset to line 9. 3, 13, 33. 48. 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 49. Line 2/line 1. of lines 27, 32,39,40, 41, and 46. 50. Line 19/line 12. 17. Includes farm and commercial mortgages. 51. Sum of lines 10 and 28. 25. Sum of lines 39, 40, 41, and 46. 52. 54. 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

A44 Domestic Nonfinancial Statistics • November 1980 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures 1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted. 1980 MMeeaassuurree 11997777 11997788 11997799 Feb. Mar. Apr. May June July' Aug/ Sept. Oct/ 1 Industrial production1 138.2 146.1 152.5 152.6 152.1 148.3 144.0 141.5 140.4 141.8 143.7 146.0 Market groupings 2 Products, total 137.9 144.8 150.0 150.1 150.0 146.6 143.7 142.5 142.8 143.9 145.0 146.4 3 Final, total 135.9 142.2 147.2 147.7 147.7 145.4 143.1 142.3 142.4 142.9 143.7 145.1 4 Consumer goods 145.3 149.1 150.8 148.4 148.6 145.3 142.4 142.1 142.0 142.8 143.8 145.5 5 Equipment 123.0 132.8 142.2 146.6 146.6 145.6 144.0 142.6 142.9 143.1 143.4 144.6 6 Intermediate 145.1 154.1 160.5 159.2 158.3 150.8 146.2 143.5 144.5 147.4 149.8 150.9 7 Materials 138.6 148.3 156.4 156.5 155.3 151.0 144.3 140.0 136.5 138.7 141.8 145.5 Industry groupings 8 Manufacturing 138.4 146.8 153.6 153.0 152.1 147.9 143.4 140.3 139.1 140.4 142.8 145.3 Capacity utilization (percent)1-2 9 Manufacturing 81.9 84.4 85.7 83.5 82.8 80.3 77.6 75.7 74.9 75.4 76.5 77.6 10 Industrial materials industries 82.7 85.6 87.4 85.6 84.7 82.1 78.3 75.7 73.7 74.6 76.1 77.9 11 Construction contracts (1972 = 100)3 160.5 174.3 181.5 171.0 155.0 130.0 125.0 145.0 148.0 192.0 163.0 n.a. 12 Nonagricultural employment, total4 125.3 131.4 136.0 138.6 138.5 138.2 137.5 136.8 136.6 137.0 137.3 137.7 13 Goods-producing, total 104.5 109.8 114.0 114.2 113.6 112.1 110.5 109.1 108.0 108.6 109.3 109.9 14 Manufacturing, total 101.2 105.3 107.9 107.8 107.7 106.1 104.3 102.9 102.0 102.5 103.1 103.6 15 Manufacturing, production-worker 98.8 102.8 104.9 103.9 103.8 101.7 99.1 97.4 96.2 97.0 97.7 98.3 16 Service-producing 136.7 143.2 148.1 151.9 152.2 152.6 152.3 152.1 152.3 152.6 152.7 153.0 17 Personal income, total5 244.4 274.1 307.1 328.1 330.4 330.7 331.8 333.6 339.0 341.5 344.6 n.a. 18 Wages and salary disbursements 230.2 258.1 287.2 305.1 307.4 306.2 306.4 307.0 307.6 310.8 313.3 n.a. 19 Manufacturing 198.3 222.4 246.8 259.2 260.8 257.8 254.4 252.9 252.8 254.6 259.1 n.a. 20 Disposable personal income 194.8 217.7 242.5 259.4 262.2 269.9 21 Retail sales6 229.8 253.8 281.6 298.0 292.4 286.6 285.0 290.4 299.1 301.0 305.6 305.2 Prices7 22 Consumer 181.5 195.4 217.4 236.4 239.8 242.5 244.9 247.6 247.8 249.4 251.7 n.a. 23 Producer finished goods 180.6 194.6 216.1 235.7 238.5 240.5 241.6 243.0' 246.6 249.0 248.9 252.2 1. The industrial production and capacity utilization series have been revised 5. Based on data in Survey of Current Business (U.S. Department of Commerce). back to January 1979. Series for disposable income is quarterly. 2. Ratios of indexes of production to indexes of capacity. Based on data from 6. Based on Bureau of Census data published in Survey of Current Business. Federal Reserve, McGraw-Hill Economics Department, and Department of Com- 7. Data without seasonal adjustment, as published in Monthly Labor Review. merce. Seasonally adjusted data for changes in the price indexes may be obtained from 3. Index of dollar value of total construction contracts, including residential, the Bureau of Labor Statistics, U.S. Department 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. Monthly data for lines 12 through 16 reflect March 1979 benchmarks; only Figures for industrial production for the last two months are preliminary and seasonally adjusted data are presently available. estimated, respectively. 2.11 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION Seasonally adjusted 1979 1980 1979 1980 1979 1980 Series Q4 Q1 Q2 Q3 Q4 Q1 Q2 03 Q4 Q1 Q2 Q3 Output (1967 = 100) Capacity (percent of 1967 oi utput) Utilization rate (percent) 1 Manufacturing 153.4 152.8 143.9 140.8 181.7 183.3 184.8 186.3 84.4 83.4 77.9 75.6 2 Primary processing 162.5 160.5 145.0 139.1 187.1 188.5 190.0 191.5 86.9 85.1 76.3 72.6 3 Advanced processing 148.5 148.8 143.3 141.7 178.9 180.5 182.0 183.5 83.0 82.5 78.7 77.2 4 Materials 156.5 156.3 145.1 139.0 181.2 182.8 184.3 185.8 86.3 85.5 78.7 74.8 5 Durable goods 156.3 155.0 140.6 131.1 185.7 187.2 188.6 190.0 84.1 82.8 74.6 69.0 6 Metal materials 119.6 117.1 100.6 86.8 140.6 140.7 140.8 140.9 85.1 83.2 71.4 61.6 7 Nondurable goods 179.2 179.3 166.0 161.5 197.6 199.8 202.0 204.3 90.6 89.7 82.2 79.0 8 Textile, paper, and chemical 187.9 187.5 171.9 165.0 205.8 208.3 211.0 213.7 91.2 90.0 81.5 77.2 9 Textile 123.8 120.6 116.4 113.3 138.4 138.8 139.2 139.6 89.4 86.9 83.7 81.2 10 Paper 148.9 146.1 142.1 141.9 153.3 154.7 156.0 157.4 97.1 94.5 91.0 90.1 11 Chemical 231.8 233.6 208.3 197.2 256.8 260.4 264.6 268.7 90.2 89.7 78.7 73.3 12 Energy materials 129.0 130.8 130.0 130.2 150.3 151.1 151.8 152.6 85.9 86.6 85.6 85.4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Capacity Utilization; Labor Market A45 2.11 Continued Previous cycle2 Latest cycle3 1979 1980 Series High Low High Low Oct. Apr. May June July Aug. Sept. Oct. Capacity utilization rate (percent) 13 Manufacturing 88.0 69.0 87.2 74.9 84.8 80.3 77.6 75.7 74.9 75.4 76.5 77.6 14 Primary processing 93.8 68.2 90.1 70.9 87.5 80.5 75.8 72.7 70.9 72.3 74.6 76.5 15 Advanced processing 85.5 69.4 86.2 77.1 83.4 80.1 78.6 77.4 77.1 77.1 77.6 78.2 16 Materials 92.6 69.4 88.8 73.7 86.6 82.1 78.3 75.7 73.7 74.6 76.1 77.9 17 Durable goods 91.5 63.6 88.4 68.0 84.8 78.8 74.1 70.8 68.0 69.1 69.7 72.1 18 Metal materials 98.3 68.6 96.0 58.4 85.4 77.2 70.0 67.0 58.4 62.3 64.0 19 Nondurable goods 94.5 67.2 90.9 76.8 90.7 86.1 81.8 78.7 76.8 78.0 82.3 84.1 20 Textile, paper, and chemical 95.1 65.3 91.4 74.5 91.4 86.0 81.3 77.1 74.5 76.1 81.1 83.7 21 Textile 92.6 57.9 90.1 79.5 90.0 84.6 84.5 81.8 82.0 79.5 82.0 22 Paper 99.4 72.4 97.6 88.1 96.9 90.7 90.8 91.6 88.1 89.6 92.7 23 Chemical 95.5 64.2 91.2 69.6 90.4 85.2 78.3 72.7 69.6 72.2 78.2 24 Energy materials 94.6 84.8 88.8 85.0 85.5 85.8 85.3 85.8 85.6 85.7 85.0 85.0 1. The capacity utilization series has been revised back to January 1979. 3. Preliminary; monthly highs December 1978 through January 1980; monthly 2. Monthly high 1973; monthly low 1975. lows July 1980 through September 1980. 2.12 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data are seasonally adjusted. Exceptions noted. 1980 CCaatteeggoorryy 1977 1978 1979 Apr. May June July Aug.' Sept/ Oct. HOUSEHOLD SURVEY DATA 1 Noninstitutional population1 158,559 161,058 163,620 165,693 165,886 166,105 166,391 166,578 166,789 167,005 22 LLaabboorr ffoorrccee ((iinncclluuddiinngg AArrmmeedd FFoorrcceess))11 .... 99,534 102,537 104,996 106,511 107,230 106,634 107,302 107,139 107,155 107,301 33 CCiivviilliiaann llaabboorr ffoorrccee 97,401 100,420 102,908 104,419 105,142 104,542 105,203 105,025 105,034 105,180 EEmmppllooyymmeenntt 44 NNoonnaaggrriiccuullttuurraall iinndduussttrriieess22 87,302 91,031 93,648 93,912 93,609 93,346 93,739 93,826 93,765 93,851 55 AAggrriiccuullttuurree 3,244 3,342 3,297 3,242 3,379 3,191 3,257 3,180 3,442 3,324 UUnneemmppllooyymmeenntt 66 NNuummbbeerr 6,855 6,047 5,963 7,265 8,154 8,006 8,207 8,019 7,827 8,005 77 RRaattee ((ppeerrcceenntt ooff cciivviilliiaann llaabboorr ffoorrccee)) 7.0 6.0 5.8 7.0 7.8 7.7 7.8 7.6 7.5 7.6 88 NNoott iinn llaabboorr ffoorrccee 59,025 58,521 58,623 59,182 58,657 59,471 59,091 59,439 59,633 59,704 ESTABLISHMENT SURVEY DATA 9 Nonagricultural payroll employment3 .... 82,423 86,446 89,497 90,951 90,468 90,047 89,867 90,142 90,365 90,622 10 Manufacturing 19,682 20,476 20,979 20,642 20,286 20,014 19,828 19,940 20,046 20,139 11 Mining 813 851 958 1,012 1,023 1,029 1,013 1,013 1,027 1,035 12 Contract construction 3,851 4,271 4,642 4,467 4,436 4,379 4,322 4,359 4,397 4,437 13 Transportation and public utilities 4,713 4,927 5,154 5,178 5,167 5,134 5,114 5,129 5,122 5,136 14 Trade 18,516 19,499 20,140 20,531 20,487 20,459 20,506 20,589 20,615 20,639 15 Finance 4,467 4,727 4,964 5,119 5,137 5,150 5,167 5,180 5,188 5,200 16 Service 15,303 16,220 17,047 17,618 17,659 17,652 17,760 17,788 17,851 17,908 17 Government 15,079 15,476 15,613 16,384 16,273 16,230 16,157 16,144 16,119 16,128 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 March 1979 bor). benchmark and only seasonally adjusted data are available at this time. Based on 2. Includes self-employed, unpaid family, and domestic service workers. data from Employment and Earnings (U.S. Department of Labor). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • November 1980 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value' Monthly data are seasonally adjusted. Grouping 1 p p ti 9 r o o 6 o r n 7 - - a 1 a v 9 g e 7 e r 9 - Oct. 1979 D ec. Jan. Feb. Mar. Apr. May June July Aug. Sept.? Oct Index (1967 = 100) MAJOR MARKET 1 Total index 100.00 152.5 152.7 152.5 152.7 152.6 152.1 148.3 144.0 141.5 140.4 141.8 143.7 146.0 2 Products 60.71 150.0 150.1 149.8 149.1 150.1 150.0 146.6 143.7 142.5 142.8 143.9 145.0 146.4 3 Final products 47.82 147.2 147.3 147.2 147.0 147.7 147.7 145.4 143.1 142.3 142.4 142.9 143.7 145.1 4 Consumer goods 27.68 150.8 150.0 148.6 147.9 148.4 148.6 145.3 142.4 142.1 142.0 142.8 143.8 145.5 5 Equipment 20.14 142.2 143.6 145.2 145.8 146.6 146.6 145.6 144.0 142.6 142.9 143.1 143.4 144.6 6 Intermediate products 12.89 160.5 160.6 159.6 160.8 159.2 158.3 150.8 146.2 143.5 144.5 147.4 149.8 150.9 7 Materials 39.29 156.4 156.6 156.6 157.0 156.5 155.3 151.0 144.3 140.0 136.5 138.7 141.8 145.5 Consumer goods 8 Durable consumer goods 7.89 155.8 153.1 146.7 142.3 144.5 144.1 136.3 128.8 128.2 128.3 128.7 133.0 138.6 9 Automotive products 2.83 167.7 159.2 141.8 131.3 142.1 141.0 126.3 118.5 121.6 129.2 121.5 130.5 141.6 10 Autos and utility vehicles 2.03 154.3 142.4 121.4 108.7 124.6 122.0 102.3 92.6 97.1 106.4 94.1 105.5 119.8 11 Autos 1.90 136.7 129.0 110.2 98.0 116.8 114.9 97.1 88.4 95.7 105.2 91.3 98.0 110.7 12 Auto parts and allied goods 80 201.5 202.1 193.6 188.5 186.7 189.1 187.2 184.0 183.7 186.9 191.1 194.2 197.0 13 Home goods 5.06 149.2 149.7 149.4 148.5 145.8 145.8 142.0 134.6 132.0 127.7 132.7 134.4 136.9 14 Appliances, A/C, and TV 1.40 127.4 128.0 133.1 128.9 122.3 122.1 114.8 102.8 105.6 102.3 114.3 116.9 122.2 15 Appliances and TV 1.33 129.3 130.2 135.5 130.0 124.4 125.0 117.5 106.0 108.5 103.4 114.2 118.3 16 Carpeting and furniture 1.07 173.0 173.1 170.8 170.9 168.2 169.1 165.8 154.2 146.7 136.1 141.1 145.3 17 Miscellaneous home goods 2.59 151.1 151.7 149.4 149.8 149.4 149.0 146.8 143.8 140.2 138.1 139.1 139.5 140.6 18 Nondurable consumer goods 19.79 148.8 148.8 149.3 150.1 150.0 150.3 148.8 147.7 147.6 147.4 148.4 148.1 148.3 19 Clothing 4.29 131.9 130.4 131.3 130.2 130.7 131.8 128.7 127.9 126.7 122.5 123.6 20 Consumer staples 15.50 153.5 153.9 154.3 155.6 155.4 155.5 154.5 153.2 153.4 154.3 155.3 155.5 155.5" 21 Consumer foods and tobacco 8.33 145.0 145.9 145.8 146.9 146.5 147.3 146.2 146.1 146.2 146.4 146.3 146.2 22 Nonfood staples 7.17 163.4 163.1 164.3 165.8 165.6 165.0 164.0 161.5 161.7 163.6 165.8 166.3 166.5 23 Consumer chemical products 2.63 205.5 206.4 207.8 210.5 211.8 208.9 206.9 203.0 202.6 204.3 209.3 211.7 24 Consumer paper products 1.92 120.8 121.7 121.0 124.1 122.5 121.6 120.4 120.2 120.6 121.5 122.6 123.3 25 Consumer energy products 2.62 152.2 150.1 152.4 151.5 150.9 152.7 152.8 150.1 150.9 153.5 153.7 152.3 26 Residential utilities 1.45 163.8 162.2 165.0 161.9 162.5 169.6 172.5 169.8 170.1 176.5 178.6 Equipment 27 Business 12.63 171.3 172.3 174.1 174.9 176.0 176.1 174.2 171.9 169.8 170.1 170.5 170.5 170.7 28 Industrial 6.77 152.2 151.8 153.2 157.2 159.2 159.3 159.3 157.8 155.2 154.8 154.7 154.0 154.6 29 Building and mining 1.44 206.3 203.2 205.0 222.1 231.6 235.6 239.5 242 2 241.0 244.4 243.6 242.7 244.0 30 Manufacturing 3.85 130.3 130.8 132.1 132.6 133.1 133.1 131.9 129.5 126.1 126.0 125.0 123.3 123.6 31 Power 1.47 156.3 156.3 157.8 157.9 156.4 153.2 152.3 149.1 147.1 142.0 145.3 147.3 148.0 32 Commercial transit, farm 5.86 193.4 196.0 198.1 195.2 195.5 195.5 191.5 188.2 186.7 187.8 188.8 189.6 191.5 33 Commercial 3.26 228.1 234.5 237.2 238.2 238.7 240.4 235.6 232.0 228.8 229.0 234.2 237.1 238.1 34 Transit 1.93 151.6 154.6 151.9 142.8 145.4 142.5 143.0 136.3 138.0 140.9 138.4 135.3 137.8 35 Farm 67 144.9 128.0 141.0 137.1 129.9 129.7 116.4 124.6 121.6 122.5 112.7 115.1 36 Defense and space 7.51 93.4 95.4 96.7 97.0 97.2 97.1 97.6 97.2 96.8 97.2 97.0 97.9 99.0 Intermediate products 37 Construction supplies 6.42 158.0 157.9 155.7 156.4 153.8 152.3 139.4 133.0 128.5 128.6 132.7 136.9 139.2 38 Business supplies 6.47 163.1 163.3 163.5 165.1 164.5 164.3 162.0 159.4 158.4 160.4 161.9 162.5 39 Commercial energy products 1.14 172.0 172.4 173.8 172.4 171.7 174.1 174.8 172.0 168.7 172.1 173.7 170.2 Materials 40 Durable goods materials 20.35 157.8 157.2 155.8 156.0 154.8 154.2 148.2 139.8 133.8 129.0 131.4 132.8 137.7 41 Durable consumer parts 4.58 137.1 131.5 125.1 120.8 119.9 120.3 110.6 100.1 96.0 93.9 98.1 101.9 107.9 42 Equipment parts 5.44 189.9 193.2 196.7 199.8 198.9 199.2 195.8 190.8 182.5 177.6 176.3 175.2 176.5 43 Durable materials n.e.c 10.34 150.1 149.5 147.8 148.5 147.0 145.5 139.8 130.5 125.0 118.9 122.5 124.2 130.5 44 Basic metal materials 5.57 124.1 121.3 118.1 118.8 116.4 116.6 109.3 100.0 95.9 84.7 89.6 91.9 45 Nondurable goods materials 10.47 175.9 178.8 180.2 181.0 179.9 177.0 173.2 165.2 159.6 156.2 159.3 168.9 173.1 46 Textile, paper, and chemical materials . 7.62 183.7 187.6 189.2 189.3 188.1 185.2 180.7 171.5 163.4 158.5 162.5 174.0 180.4 47 Textile materials 1.85 121.0 124.4 123.8 120.1 121.1 120.7 117.7 117.6 114.0 114.4 111.0 114.6 48 Paper materials 1.62 143.5 148.1 150.1 148.2 146.0 144.2 141.2 141.7 143.4 138.4 141.0 146.3 49 Chemical materials 4.15 227.4 231.2 233.6 236.3 234.5 230.1 224.3 207.3 193.3 186.1 194.0 211.4 50 Containers, nondurable 1.70 167.4 169.1 168.2 172.7 170.6 167.1 166.8 155.8 157.7 159.0 158.8 167.0 51 Nondurable materials n.e.c 1.14 136.8 134.6 138.8 137.5 138.7 137.4 133.0 136.4 136.8 136.6 138.6 137.2 52 Energy materials 8.48 128.9 128.1 129.4 130.0 131.5 130.9 130.1 129.6 130.4 130.4 130.7 129.8 130.0 53 Primary energy 4.65 113.5 113.6 113.7 114.4 113.7 115.6 116.4 116.2 117.3 115.6 115.2 114.9 54 Converted fuel materials 3.82 147.7 145.7 148.5 149.0 153.1 149.6 146.9 145.8 146.4 148.4 149.6 148.0 Supplementary groups 55 Home goods and clothing 9.35 141.3 140.8 141.1 140.1 138.9 139.4 135.9 131.5 129.5 125.3 128.5 128.5 130.2 56 Energy, total 12.23 137.9 136.9 138.4 138.6 139.4 139.6 139.1 137.9 138.4 139.2 139.6 138.4 138.3 57 Products 3.76 158.2 156.8 158.9 157.8 157.2 159.1 159.5 156.7 156.3 159.1 159.7 157.7 58 Materials 8.48 128.9 128.1 129.4 130.0 131.5 130.9 130.1 129.6 130.4 130.4 130.7 129.8 130.0 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Output A47 2.13 Continued 1967 1979 1980 GGrroouuppiinngg SSIICC p p r o o r - - Avg. code tion Oct. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept/ Oct/ Index (1967 = 100) MAJOR INDUSTRY 12.05 144.7 145.7 148.2 148.2 149.0 151.4 150.1 149.6 150.1 150.1 151.0 150.3 150 9 2 Mining 6.36 125.5 127.8 131.4 133.5 132.9 133.0 133.1 133.4 132.9 130.6 130.5 130.9 132.0 3 Utilities 5.69 166.0 165.7 166.9 16.48 167.1 172.0 169.1 167.7 169.3 171.8 174.0 117711..99 117722..00 3.88 185.8 184.5 186.0 183.4 185.7 192.4 187.9 186.0 188.7 192.4 195.4 87.95 153.6 153.7 153.2 153.4 153.0 152.1 147.9 143.4 140.3 139.1 140.4 142.8 145.3 35.97 164.0 164.8 165.3 166.0 165.9 164.7 161.6 158.0 155.3 154 7 156 4 159.3 160 9 7 Durable 5511..9988 114466..44 114466..00 114444..88 114444..77 114444..11 114433..44 113388..44 113333..33 112299..99 112288..33 112299..33 113311..55 113344..66 Mining 8 Metal 10 .51 127.0 124.2 136.9 137.6 136.6 132.7 123.5 120.8 120.0 83.1 71.2 74.0 9 Coal 11.12 .69 135.6 146.0 143.4 141.0 136.0 137.2 143.4 145.0 150.0 149.8 154.9 148.9 149.0 10 Oil and gas extraction 13 4.40 121.7 123.6 127.2 129.9 130.4 131.8 132.5 133.9 133.2 134.3 134.8 135.6 136.0 11 Stone and earth minerals 14 .75 137.6 138.2 141.4 144.6 142.3 136.0 133.1 128.1 123.9 123.7 123.1 125.5 Nondurable manufactures 12 Foods 20 8.75 147.5 147.7 148.4 148.5 149.0 149.3 147.8 149.5 149.0 148.9 148.2 148.7 13 Tobacco products 21 .67 117.8 115.6 116.6 118.7 120.0 122.2 121.9 116.2 113.9 119.6 117.4 14 Textile mill products 22 2.68 145.0 147.7 148.0 143.4 144.0 142.0 139.9 137.1 133.6 132.5 132.6 132.9 15 Apparel products 23 3.31 134.4 131.5 131.1 131.5 133.8 136.1 131.3 128.6 127.2 121.5 123.8 16 Paper and products 26 3.21 151.0 154.2 155.7 157.4 153.6 152.7 148.2 145.7 146.2 143.6 146.5 150.5' 150.7 17 Printing and publishing 27 4.72 136.9 137.2 137.8 138.9 139.9 139.2 136.5 135.5 135.4 138.6 139.8 141.1 140.9 18 Chemicals and products 28 7.74 211.8 212.9 216.8 218.0 217.4 213.6 209.1 199.2 191.1 190.3 196.3 205.1 19 Petroleum products 29 1.79 143.9 142.6 145.4 147.5 144.6 140.7 137.4 133.0 131.3 130.5 126.2 130.7 129.0 20 Rubber and plastic products 30 2.24 272.2 278.0 263.8 265.5 266.8 264.4 261.8 248.1 242.9 242.5 245.9 247.6 21 Leather and products 31 .86 71.7 70.1 71.2 74.2 73.3 72.8 69.9 70.1 68.5 67.8 67.7 66.0 Durable manufactures 22 Ordnance, private and government 19.91 3.64 75.2 77.1 77.5 77.1 77.2 76.9 77.5 77.9 77.5 77.1 77.5 77.7 79.2 23 Lumber and products 24 1.64 136.9 138.7 132.4 131.6 130.2 125.3 105.2 104.5 109.7 112.8 120.5 124.0 24 Furniture ana fixtures 25 1.37 161.5 163.3 161.0 160.8 159.2 159.5 157.1 149.5 143.1 138.6 141.1 143.1 25 Clay, glass, stone products 32 2.74 163.9 163.6 163.8 165.0 162.4 156.4 148.8 140.8 134.5 134.2 135.0 140.6 26 Primary metals 33 6.57 121.3 118.4 115.3 116.4 111.9 113.7 106.4 96.1 90.4 81.7 86.2 90.3 98.5 27 Iron and steel 331.2 4.21 113.2 108.8 106.6 107.2 103.4 105.9 97.4 84.4 75.4 68.1 75.3 80.0 28 Fabricated metal products 34 5.93 148.5 147.5 146.2 145.0 145.7 145.5 141.4 133.2 126.1 123.8 125.3 127.0 128.3' 29 Nonelectrical machinery 35 9.15 163.7 162.9 163.0 167.1 167.0 166.5 163.2 162.1 158.3 158.5 158.8 159.0 160.1 30 Electrical machinery 36 8.05 175.0 177.3 181.6 181.7 179.2 179.2 177.0 171.4 166.6 165.0 166.7 167.1 169.7 31 Transportation equipment 37 9.27 135.4 133.3 127.3 122.1 125.7 123.8 115.1 109.8 110.0 110.7 108.3 113.1 118.9 32 Motor vehicles and parts 371 4.50 159.9 150.1 137.1 126.2 133.9 130.1 114.7 105.9 106.7 107.9 104.4 113.6 124.5 33 Aerospace and miscellaneous transportation equipment 372-9 4.77 112.2 117.4 118.1 118.3 118.1 117.8 115.5 113.5 113.1 113.4 111.9 112.6 113.6 34 Instruments 38 2.11 174.9 175.0 175.0 175.9 174.8 173.5 173.8 171.0 169.2 167.5 167.6 166.9 167.7 35 Miscellaneous manufactures .... 39 1.51 154.7 154.5 153.7 153.8 151.6 152.8 151.2 147.3 143.7 144.7 144.2 145.0 143.5 Gross value (billions of 1972 dollars, annual rates) MAJOR MARKET 36 Products, total 507.4 625.3 623.7 619.7 615.8 619.8 619.0 599.5 588.6 585.0 586.7 585.7 594.1 599.7 37 Final 390.92 480.8 479.3 476.1 471.2 476.4 475.9 464.5 457.3 455.6 456.9 452.9 459.3 463.5 38 Consumer goods 277.52 327.1 325.3 322.1 317.6 320.0 321.3 312.5 306.3 305.8 307.7 304.9 310.3 311.8 39 Equipment 113.42 153.6 154.0 154.0 153.6 156.3 154.6 152.0 151.0 149.8 149.2 148.0 149.0 151.7 40 Intermediate 116.62 144.6 144.4 143.6 144.6 143.4 143.1 135.0 131.3 129.4 129.9 132.8 134.8 136.2 1. The industrial production series has been revised back to January 1979. NOTE. Published groupings include some series and subtotals not shown sepa- 2. 1972 dollars. rately. For description and historical data, see Industrial Production—1976 Revision (Board of Governors of the Federal Reserve System: Washington. D.C.), December 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 Domestic Nonfinancial Statistics • November 1980 2.14 HOUSING AND CONSTRUCTION Monthly figures are at seasonally adjusted annual rates except as noted. 1980 Item 1977 1978 1979 Feb. Mar. Apr. May June July' Aug.' Sept. Private residential real estate activity (thousands of units) NEW UNITS 1 Permits authorized 1,677 1,801 1,552 1.168 968 789 825 1.078 1,236 1,361 1,561 2 1-family 1,125 1,183 981 708 556 473 495 628 781 857 905 3 2-or-more-family 551 618 570 460 412 316 330 450 455 504 654 4 Started 1,987 2,020 1,745 1.330 1,041 1.030 906 1,223 1,265 1,416 1,544 5 1-family 1,451 1.433 1.194 786 617 628 628 757 869 1,000 1,050 6 2-or-more-family 536 587 551 417 424 402 278 466 396 416 494 7 Under construction, end of period1 ... 1,208 1.310 1,140 1,095 1.062 978 911 871' 853 849 n.a. 8 1-family 730 765 639 622 589 535 495 474' 474 475 n.a. 9 2-or-more-family 478 546 501 473 473 443 416 397' 379 374 n.a. 10 Completed 1,656 1,868 1,855 1,832 1.669 1.897 1.536 1,469' 1,498 1,404 n.a. 11 1-family 1,258 1,369 1,286 1.230 1.093 1.135 970 886' 876 915 n.a. 12 2-or-more-family 399 499 570 602 576 762 566 583' 622 489 n.a. 13 Mobile homes shipped 277 276 277 270 226 201 162 163 215 206 n.a. Merchant builder activity in 1-family units 14 Number sold 820 818 709 548 458 345 458 544' 650 643 554 15 Number for sale, end of period1 408 419 402 396 377 364 351 340' 333 329 335 Price (thousands of dollars)2 Median 16 Units sold 49.0 55.8 62.7 64.8 62.3 62.8 63.2 65.4' 64.2 63.0 68.8 Average 17 Units sold 54.4 62.7 71.9 76.6 71.1 74.1 73.1 76.3' 76.7 76.1 81.1 EXISTING UNITS (1-family) 18 Number sold 3,572 3,905 3,742 2,990 2.750 2.420 2,310 2,480 2,920 3,030 33,,338800 Price of units sold (thous. of dollars)2 19 Median 42.8 48.7 55.5 59.0 59.5 60.4 61.2 63.4 64.1 64.9 64.2 20 Average 47.1 55.1 64.0 69.4 69.4 70.6 71.2 75.7 75.7 76.2 75.5 Value of new construction3 (millions of dollars) CONSTRUCTION 21 Total put in place 173,976 205,457 228,948 248,756 237,132 225,833 218,909 215,021 214,230 215,051 221,959 22 Private 135,799 159,555 179,948 191,732 180,616 171.488 164,791 161,349 158,921 162,543 167,748 23 Residential 80,957 93,423 99,029 101.519 93,991 83.467 76,957 73,360 74,954 79,754 85,525 24 Nonresidential, total 54,842 66,132 80,919 90,213 86,625 88.021 87,834 87,989 83,967 82,789 8822,,222233 Buildings 25 Industrial 7,713 10,993 14,953 15,690 13.916 13.611 14,197 15,022 13,267 13,046 13,340 26 Commercial 14,789 18,568 24,924 30,727 29.911 30.878 30,149 29,609 28,063 27,993 26,862 27 Other 6,200 6,739 7,427 8,508 8.515 8.220 8,571 8,256 8,115 8,095 8,120 28 Public utilities and other 26,140 29,832 33,615 35,288 34.283 35.312 34,917 35,102 34,522 33,655 33,901 29 Public 38,172 45,901 49,001 57.023 56,516 54.344 54,118 53,672 55,308 52,508 54,211 30 Military 1.428 1,501 1,641 1,530 1.895 2.048 1,671 1,748 1,727 1,841 1,450 31 Highway 9.380 10,713 11,915 15,693 13.606 14.393 13,230' 14.012 13,758 10,866 n.a. 32 Conservation and development 3,862 4,457 4,586 5,325 5.686 5.000 5,285' 4,241 5,893 4,295 n.a. 33 Other4 23,502 29,230 30,859 34,475 35.329 32.903 33.932' 33,671 33,930 35,506 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 A49 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 IIInnndddeeexxx llleeevvveeelll IIIttteeemmm 1979 1980 1980 SSS 111 eee 999 ppp 888000 ttt... 11997799 11998800 (((111999666777 SSeepptt.. SSeepptt.. === 111000000)))111 Dec. Mar. June Sept. May June July Aug. Sept. CONSUMER PRICES2 1 All items 12.1 12.7 13.7 18.1 11.6 7.0 .9 1.0 0.0 .7 1.0 251.7 2 Commodities 12.4 11.6 12.5 16.1 5.0 12.8 .3 .3 .6 1.2 1.2 239.0 3 Food 10.0 10.1 12.1 3.8 5.6 18.9 .3 .5 1.0 1.8 1.6 261.1 4 Commodities less food 13.5 12.3 12.7 22.1 4.7 10.6 .4 .3 .5 .9 1.1 226.6 5 Durable 9.8 10.7 13.2 7.6 6.8 15.7 .6 .5 .5 1.6 1.6 215.3 6 Nondurable 18.4 14.2 12.8 39.8 3.5 4.0 .2 .1 .3 .4 .2 239.3 7 Services 11.6 14.2 15.8 20.9 21.6 -.6 1.6 1.8 -.8 -.1 .7 274.8 8 Rent 7.6 9.0 9.0 8.3 10.0 8.6 1.0 1.2 .5 .6 1.0 195.1 9 Services less rent 12.2 15.0 16.9 22.8 23.3 1.8 1.7 1.9 -.9 -.2 .7 289.8 Other groupings 10 All items less food 12.6 13.2 14.2 21.7 13.0 4.6 1.0 1.1 -.2 .4 .9 248.6 11 All items less food and energy 9.9 12.0 13.9 15.7 13.5 5.1 1.0 1.1 -.2 .5 .9 236.9 12 Homeownership 16.1 16.8 25.6 24.1 26.6 -5.6 1.8 2.3 -1.8 -.2 .6 317.6 PRODUCER PRICES 13 Finished goods 12.0 12.8 13.3 19.3 6.0 12.2 .3 .7' 1.5' 1.5' -.2 248.9 14 Consumer 13.5 13.6 14.6 21.6 4.9' 13.8 .4 .7' 1.6' 1.8 -.2 251.8 15 Foods 8.9 7.8 8.6 -1.2 -7.8' 36.9 0 .7 3.8 4.4 -.2 245.8 16 Excluding foods 16.0 16.6 17.9 34.8 11.3' 4.4 .5 .6' .6' .6 -.1 252.3 17 Capital equipment 8.3 10.8 10.0 13.4 11.3' 8.5 .2 .7' 1.3 .9 -.1 241.3 18 Intermediate materials3 15.0 13.0 17.0 24.0 5.2' 6.4 -.1 .8' .5' .5 .5 285.2 Crude Materials 19 Nonfood 23.3 20.2 27.8 21.9 -3.9 39.1 0.0 -.5 3.2 1.8 3.3 436.3 20 Food 13.9 11.3 5.7 -16.7 -10.5 96.4 2.4 1.1 9.0 9.0 -.4 276.7 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

A50 Domestic Nonfinancial Statistics • November 1980 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates. 1979 1980 AAccccoouunntt 11997777 11997788 11997799 Q2 Q3 Q4 Q1 02 Q3 P GROSS NATIONAL PRODUCT 1 Total 1,899.5 2,127.6 2,368.8 2,329.8 2,396.5 2,456.9 2,520.8 2,521.3 2,583.0 By source 2 Personal consumption expenditures 1,210.0 1,350.8 1,509.8 1,475.9 1,528.6 1,580.4 1,629.5 1,626.6 1,681.8 3 Durable goods 178.8 200.3 213.0 208.7 213.4 216.2 220.2 195.7 209.3 4 Nondurable goods 481.3 530.6 596.9 581.2 604.7 630.7 652.0 654.1 666.4 5 Services 549.8 619.8 699.8 686.0 710.6 733.5 757.3 776.9 806.1 6 Gross private domestic investment 303.3 351.5 387.2 395.4 392.3 387.2 387.7 368.5 346.0 7 Fixed investment 281.3 329.1 369.0 361.9 377.8 381.7 383.0 357.1 363.9 8 Nonresidential 189.4 221.1 254.9 249.1 261.8 265.2 272.6 268.2 271.4 9 Structures 62.6 76.5 92.6 90.5 95.0 100.2 103.3 103.7 102.4 10 Producers' durable equipment 126.8 144.6 162.2 158.6 166.7 165.1 169.4 164.5 169.0 11 Residential structures 91.9 108.0 114.1 112.9 116.0 116.4 110.4 88.9 92.5 12 Nonfarm 88.8 104.4 110.2 109.1 112.0 112.1 105.9 85.3 88.9 13 Change in business inventories 21.9 22.3 18.2 33.4 14.5 5.6 4.7 11.4 -17.9 14 Nonfarm 20.7 21.3 16.5 32.6 12.6 2.1 4.4 12.3 -13.1 15 Net exports of goods and services -9.9 -10.3 -4.6 -8.1 -2.3 -11.9 -13.6 -2.2 18.6 16 Exports 175.9 207.2 257.5 243.7 267.3 280.4 308.1 307.0 312.1 17 Imports 185.8 217.5 262.1 251.9 269.5 292.4 321.7 309.2 293.5 18 Government purchases of goods and services 396.2 435.6 476.4 466.6 477.8 501.2 517.2 528.3 536.7 19 Federal 144.4 152.6 166.6 161.7 162.9 178.4 186.2 193.3 194.6 20 State and local 251.8 283.0 309.8 304,9 314.9 322.8 331.0 335.0 342.1 By major type of product 21 Final sales, total 1,877.6 2,105.2 2,350.6 2,296.4 2.381.9 2,451.4 2,516.1 2,509.9 2,600.9 22 Goods 842.2 930.0 1,030.5 1,018.1 1,036.0 1,056.3 1,086.2 1,079.2 1,100.6 23 Durable 345.9 380.4 423.1 422.4 424.4 420.2 421.5 414.7 434.7 24 Nondurable 496.3 549.6 607.4 595.7 611.6 636.1 664.8 664.5 666.0 25 Services 866.4 969.3 1,085.1 1,064.2 1,100.6 1,134.0 1,169.5 1,199.9 1,237.6 26 Structures 190.9 228.2 253.2 247.5 259.8 266.6 265.1 242.2 244.8 27 Change in business inventories 21.9 22.3 18.2 33.4 14.5 5.6 4.7 11.4 -17.9 28 Durable goods 11.9 13.9 13.0 24.3 7.3 1.8 -9.3 6.1 .9 29 Nondurable goods 10.0 8.4 5.2 9.1 7.2 3.8 14.0 5.3 -18.8 30 MEMO: Total GNP in 1972 dollars 1,340.5 1,399.2 1,431.6 1,422.3 1,433.3 1,440.3 1,444.7 1,408.6 1,412.1 NATIONAL INCOME 31 Total 1,525.8 1,724.3 1,924.8 1,897.9 1,941.9 1,990.4 2,035.4 2,024.6 n.a. 32 Compensation of employees 1,156.9 1,304.5 1,459.2 1,439.7 1,472.9 1,513.2 1,555.2 1,567.2 1,590.1 33 Wages and salaries 984.0 1,103.5 1,227.4 1,211.5 1,238.0 1,270.7 1,303.6 1,310.4 1,328.2 34 Government and government enterprises 201.3 218.0 233.5 231.2 234.4 240.2 243.5 247.5 251.0 35 Other 782.7 885.5 993.9 980.3 1,003.6 1,030.5 1,060.1 1,062.9 1,077.3 36 Supplement to wages and salaries 172.9 201.0 231.8 228.2 234.8 242.5 251.6 256.8 261.9 37 Employer contributions for social insurance 81.2 94.6 109.1 107.9 109.9 113.0 117.2 118.1 119.7 38 Other labor income 91.8 106.5 122.7 120.3 124.9 129.6 134.4 138.7 142.2 39 Proprietors' income1 100.2 116.8 130.8 129.3 130.3 134.5 130.0 120.5 124.2 40 Business and professional1 80.5 89.1 98.0 95.5 99.4 102.1 102.3 97.4 100.0 41 Farm1 19.6 27.7 32.8 33.7 30.9 32.5 27.7 23.1 24.2 42 Rental income of persons2 24.7 25.9 26.9 26.8 26.6 27.0 27.0 27.3 27.8 43 Corporate profits1 150.0 167.7 178.2 176.6 180.8 176.4 175.0 152.8 n.a. 44 Profits before tax3 177.1 206.0 236.6 227.9 242.3 243.0 260.4 204.8 n.a. 45 Inventory valuation adjustment -15.2 -25.2 -41.8 -36.6 -44.0 -46.5 -63.2 -27.4 -36.3 46 Capital consumption adjustment -12.0 -13.1 -16.7 -14.7 -17.6 -20.1 -22.2 -24.6 -28.2 47 Net interest 94.0 109.5 129.7 125.6 131.5 139.2 148.1 156.8 164.5 1. With inventory valuation and capital consumption adjustments. 3. For after-tax profits, dividends, and the like, see table 1.49. 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 A51 2.17 PERSONAL INCOME AND SAVING Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted. 1979 1980 11997777 11997788 11997799 Q2 Q3 Q4 Q1 02 Q3 P PERSONAL INCOME AND SAVING 1 Total personal income 1,531.6 1,717.4. 1,924.2 1,892.5 1,946.6 2,005.0 2,057.4 2,080.5 2,141.1 2 Wage and salary disbursements 984.0 1,103.3 1.227.6 1,212.4 1.238.1 1,270.5 1,303.7 1,310.4 1,327.6 3 Commodity-producing industries 343.1 387.4 435.2 431.7 438.3 447.8 460.0 454.5 455.4 4 Manufacturing 266.0 298.3 330.9 328.5 331.9 338.3 347.2 342.0 343.2 5 Distributive industries 239.1 269.4 300.8 295.8 304.0 312.4 320.1 320.8 325.1 6 Service industries 200.5 228.7 257.9 252.8 261.3 270.2 280.0 287.6 296.1 7 Government and government enterprises 201.3 217.8 233.7 232.1 234.5 240.1 243.6 247.5 251.0 8 Other labor income 91.8 106.5 122.7 120.3 124.9 129.6 134.4 138.7 142.2 9 Proprietors' income1 100.2 116.8 130.8 129.3 130.3 134.5 130.0 120.5 124.2 10 Business and professional1 80.5 89.1 98.0 95.5 99.4 102.1 102.3 97.4 100.0 11 Farm1 19.6 27.7 32.8 33.7 30.9 32.5 27.7 23.1 24.2 12 Rental income of persons2 24.7 25.9 26.9 26.8 26.6 27.0 27.0 27.3 27.8 13 Dividends 42.1 47.2 52.7 52.3 52.8 54.4 56.7 58.6 59.7 14 Personal interest income 141.7 163.3 192.1 187.6 194.4 205.5 217.2 228.8 235.5 15 Transfer payments 208.4 224.1 252.0 243.6 260.8 266.5 274.9 282.5 312.4 16 Old-age survivors, disability, and health insurance benefits 105.0 116.3 132.4 127.1 138.7 140.0 142.0 143.6 161.7 17 LESS: Personal contributions for social insurance . 61.3 69.6 80.7 79.8 81.2 82.9 86.6 86.3 88.3 18 EQUALS: Personal income 1.531.6 1,717.4 1,924.2 1,892.5 1,946.6 2,005.0 2,057.4 2,080.5 2,141.1 19 LESS: Personal tax and nontax payments 226.4 259.0 299.9 290.7 306.6 321.9 320.0 324.6 333.6 20 EQUALS: Disposable personal income 1.305.1 1,458.4 1,624.3 1,601.7 1,640.0 1,683.1 1,737.4 1,755.9 1,807.5 21 LESS: Personal outlays 1,240.2 1,386.4 1,550.5 1,515.8 1,569.7 1,623.4 1,672.9 1,669.5 1,724.2 22 EQUALS: Personal saving 65.0 72.0 73.8 85.9 70.3 59.7 64.4 86.3 83.3 MEMO: Per capita (1972 dollars) 23 Gross national product 6,181 6,402 6,494 6,459 6,494 6,509 6,514 6,336 6,335 24 Personal consumption expenditures 3,974 4,121 4,194 4,155 4,195 4,227 4,222 4,097 4,138 25 Disposable personal income 4,285 4,449 4,512 4,510 4,501 4,502 4,502 7,900 8,107 26 Saving rate (percent) 5.0 4.9 4.5 5.4 4.3 3.5 3.7 4.9 4.6 GROSS SAVING 27 Gross saving 276.1 324.6 363.9 374.3 367.3 351.9 346.6 345.5 n.a. 28 Gross private saving 295.6 324.9 349.6 360.5 352.1 340.7 343.7 374.0 n.a. 29 Personal saving 65.0 72.0 73.8 85.9 70.3 59.7 64.4 86.3 83.3 30 Undistributed corporate profits1 35.2 36.0 32.9 35.6 34.0 25.9 15.9 16.6 15.3 31 Corporate inventory valuation adjustment -15.2 -25.2 -41.8 -36.6 -44.0 -46.5 -63.2 -27.4 n.a. Capital consumption allowances 32 Corporate 121.3 132.9 147.7 145.1 150.4 155.3 159.6 163.9 116699..66 33 Noncorporate 74.1 84.0 95.3 93.9 97.5 99.8 103.7 107.1 111100..11 34 Wage accruals less disbursements ..66 35 Government surplus, or deficit (-), national income and product accounts -19.5 -.3 13.2 12.7 14.0 10.0 1.7 -29.6 nn..aa.. 36 Federal -46.3 -27.7 -11.4 -7.0 -11.3 -15.7 -22.9 -49.2 nn..aa.. 37 State and local 26.8 27.4 24.6 19.7 25.3 25.8 24.6 19.5 nn..aa.. 38 Capital grants received by the United States, net .. 1.1 1.1 1.1 1.1 11..22 11..22 11..22 39 Gross investment 283.6 327.9 367.6 373.1 375.6 359.1 335577..55 335500..99 334499..99 40 Gross private domestic 303.3 351.5 387.2 395.4 392.3 387.2 387.7 368.5 346.0 41 Net foreign -19.6 -23.5 -19.5 -22.3 -16.7 -28.1 -30.2 -17.6 3.9 42 Statistical discrepancy 7.5 3.3 2.9 -1.3 8.3 7.2 11.0 5.4 n.a. 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

A52 International Statistics • November 1980 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data are seasonally adjusted except as noted J 1979 1980 Item credits or debits 11997777 11997788 11997799 Q2 Q3 Q4 Q1 Q2 P 1 Balance on current account -14,068 -14,259 -788 -1,493 1,099 -1,802 -2,635 -2,500 2 Not seasonally adjusted -61 -2,909 486 -2,453 -738 3 Merchandise trade balance2 -30,873 -33,759 -29,469 -8,070 -7,060 -9,225 -10,875 -7,643 4 Merchandise exports 120,816 142,054 182,055 42,815 47,198 50,237 54,708 54,710 5 Merchandise imports -151,689 -175,813 -211,524 -50,885 -54,258 -59,462 -65,583 -62,353 6 Military transactions, net 1,628 886 -1,274 -102 -443 -700 -922 -1,074 7 Investment income, net3 17,988 20,899 32,509 7,271 9,319 8,883 10,094 6,355 8 Other service transactions, net 1,794 2,769 3,112 791 690 792 880 1,104 9 MEMO: Balance on goods and services3 4 -9,464 -9,204 4,878 -110 2,506 -250 -823 -1,258 10 Remittances, pensions, and other transfers -1,830 -1,884 -2,142 -484 -529 -665 -565 -557 11 U.S. government grants (excluding military) -2,775 -3,171 -3,524 -899 -878 -887 -1,247 -685 12 Change in U.S. government assets, other than official reserve assets, net (increase, -) -3,693 -4,644 -3,783 -991 -766 -925 -1,467 -1,280 13 Change in U.S. official reserve assets (increase, -) -375 732 -1,106 343 2,779 -644 -3,246 473 14 Gold -118 -65 -65 0 0 -65 0 0 15 Special drawing rights (SDRs) -121 1,249 -1,136 6 0 0 -1,152 112 16 Reserve position in International Monetary Fund -294 4,231 -189 -78 -52 27 -34 -99 17 Foreign currencies 158 -4,683 283 415 2,831 -606 -2,060 460 18 Change in U.S. private assets abroad (increase, -)3 -31,725 -57,279 -56,858 -14,631 -27,228 -11,918 -7,976 -25,554 19 Bank-reported claims -11,427 -33,631 -25,868 -7,839 -16,997 -7,213 -274 -20,913 20 Nonbank-reported claims - i,940 -3,853 -2,029 935 -932 410 -1,474 n.a. 21 U.S. purchase of foreign securities, net -5,460 -3,450 -4,643 -513 -2,143 -986 -765 -1,325 22 U.S. direct investments abroad, net3 -12,898 -16,345 -24,318 -7,214 -7,156 -4,129 -5,463 -3,316 23 Change in foreign official assets in the United States (increase, + ) 36,574 33,292 -14,270 -10,095 5,789 -1,221 -7,215 7,816 24 U.S. Treasury securities 30,230 23,523 -22,356 -12,859 5,024 -5,769 -5,357 4,315 25 Other U.S. government obligations 2,308 666 465 94 335 41 801 247 26 Other U.S. government liabilities5 1,159 2,220 -714 122 216 -924 181 1,035 27 Other U.S. liabilities reported by U.S. banks 773 5,488 7,219 2,354 56 4,881 -3,185 1,559 28 Other foreign official assets'* 2,105 1,395 1,116 195 158 550 345 660 29 Change in foreign private assets in the United States (increase, 14,167 30,804 51,845 16,502 19,152 5,246 14,409 -2,056 30 U.S. bank-reported liabilities 6,719 16,259 32,668 12,082 13,185 400 6,355 -4,334 31 U.S. nonbank-reported liabilities 473 1,640 1,692 579 606 1,050 683 n.a. 32 Foreign private purchases of U.S. Treasury securities, net 534 2,197 4,830 -120 1,466 920 3,278 -1,226 33 Foreign purchases of other U.S. securities, net 2,713 2,811 2,942 1,149 677 313 2,427 1,350 34 Foreign direct investments in the United States, net3 .. 3,728 7,896 9,713 2,812 3,217 2,564 1,666 2,155 35 Allocation of SDRs 0 0 1,139 0 0 0 1,152 0 36 Discrepancy -880 11,354 23,822 10,364 -825 11,264 6,978 23,100 37 Owing to seasonal adjustments 1,167 -3,641 2,400 -101 1,473 38 Statistical discrepancy in recorded data before seasonal adjustment -880 11,354 23,822 9,197 2,816 8,864 7,079 21,627 MEMO: Changes in official assets 39 U.S. official reserve assets (increase, -) -375 732 -1,106 343 2,779 -644 -3,246 473 40 Foreign official assets in the United States (increase, +) 35,416 31,072 -13,556 -10,216 5,573 -297 -7,396 6,781 41 Change in Organization of Petroleum Exporting Countries official assets in the United States (part of line 23 above) 6,351 -1,137 5,508 238 1,676 4,955 2,930 4,671 42 Transfers under military grant programs (excluded from lines 4, 6, and 11 above) 204 236 305 49 88 139 144 152 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 A53 3.11 U.S. FOREIGN TRADE Millions of dollars; monthly data are seasonally adjusted. 1980 IItteemm 11997777 11997788 11997799 Mar. Apr. May June July Aug. Sept. 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments 121.150 143.578 181,637 18.534 18,468 17.678 18.642 18.075 19,103 18,701 2 GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded warehouses 147,685 171.978 206.326 20,588'' 19.257' 20.439' 19,893 18.995 19,236 19,465 3 Trade balance -26,535 -28,400 -24,690 -2,054' -789' -2,762' -1,251 -920 -132 -764 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 international-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 1980 TTyyppee 11997777 11997788 11997799 Apr. May June July Aug. Sept. Oct. 1 Total' 19,312 18,650 18,956 21,644 21,917 21,943 21,845 22,691 22,994 23,967 2 Gold stock, including Exchange Stabilization Fund1 11,719 11.671 11,172 11.172 11.172 11.172 11,172 11,172 11,168 11,163 3 Special drawing rights2-3 2,629 1.558 2.724 3.697 3,744 3,782 3,842 4,009 4.007 3,939 4 Reserve position in International Monetary Fund2 4.946 1.047 1,253 1.094 1,157 1.385 1,410 1.564 1,665 1,671 5 Foreign currencies4-5 18 4,374 3,807 5.681 5,844 5,604 5,421 5.946 6,154 7,194 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: $1,139 million on Jan. 1, 1979; and $1,152 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 5. Includes U.S. government securities held under repurchase agreement against basis beginning July 1974. receipt of foreign currencies, if any. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 International Statistics • November 1980 3.13 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data Millions of dollars, end of period 1980 Asset account 1977 19781 1979 Feb.' Mar.' Apr.' May' June' July Aug.P All foreign countries 1 Total, all currencies 258,897 306,795 364,233r 372,149 371,533 376,146 378,899 376,722 377,813 386,168 2 Claims on United States 11,623 17.340 32.302 39.737 35.682 34.183 35.606 29.069 29,053 36,789 3 Parent bank 7,806 12.811 25.929 32.192 28.249 26.290 26,139 18,565 17,525 26,652 4 Other 3,817 4.529 6.373 7.545 7,433 7.893 9,467 10,504 11,528 10,137 5 Claims on foreigners 238,848 278.135 317,175' 317.041 319,795 325.623 326,340 330.171 331,301 332,317 6 Other branches of parent bank 55,772 70.338 79.661 78.104 80,523 79.500 76,317 76.061 75,196 72,417 7 Banks 91,883 103.111 123,395' 124.533 126.069 130.198 130,313 132.587 134,624 136,484 8 Public borrowers2 14,634 23.737 26.072' 26,056 25,483 25.213 25,411 25.604 25.411 26,112 9 Nonbank foreigners 76.560 80.949 88.047' 88.348 87.720 90.712 94,299 95.919 96,070 97,304 10 Other assets 8,425 11.320 14,756' 15,371 16.056 16.340 16,953 17.482 17,459 17,062 11 Total payable in U.S. dollars 193,764 224,940 267,711' 276,066 276,760 277,791 277,542 275,243 275,719 284,331 12 Claims on United States 11,049 16.382 31.171 38,520 34,502 32.899 34,314 27.867 27,688 35,476 13 Parent bank 7.692 12.625 25.632 31.812 27.897 25.920 25,778 18.254 17,209 26,331 14 Other 3,357 3.757 5.539 6.708 6.605 6.979 8,536 9.613 10,479 9,145 15 Claims on foreigners 178.896 203.498 229.118' 229,060 233,763 235.953 234,159 238,213 239,271 240,012 16 Other branches of parent bank 44,256 55.408 61.525 60.174 63,404 61.768 58,908 58.456 57,813 54,965 17 Banks 70.786 78,686 96.243' 97.266 99.383 103.256 102,693 104.902 106,313 107,976 18 Public borrowers2 12,632 19,567 21.629' 21.800 21.378 20.994 21,217 21.379 21,229 21,785 19 Nonbank foreigners 51,222 49.837 49.721' 49,820 49,598 49.935 51.341 53.476 53,916 55,286 20 Other assets 3,820 5.060 7.422' 8.486 8.495 8,939 9.069 9.163 8,760 8,843 United Kingdom 21 Total, all currencies 90,933 106,593 130,873 133,793 136,654 138,915 138,930 139,066 135,669 136,435 22 Claims on United States 4,341 5.370 11.117 10.697 11.990 11.533 11,399 9.157 8,366 8,433 23 Parent bank 3.518 4.448 9.338 8.584 9,838 9.300 9,140 6.870 5,705 5,991 24 Other 823 922 1.779 2.113 2,152 2,233 2,259 2,287 2,661 2,442 25 Claims on foreigners 84.016 98,137 115.123 118.212 119,290 122.105 121,851 124,059 120,914 121,805 26 Other branches of parent bank 22.017 27.830 34.291 35.187 35,536 36.015 34,305 34,824 32,231 31,607 27 Banks 39.899 45.013 51.343 53.127 52,509 54.020 54,076 54,855 54,824 55,530 28 Public borrowers2 2,206 4.522 4.919 4.499 5,860 5.578 5,591 5.897 5,710 5,865 29 Nonbank foreigners 19.895 20.772 24.570 25,399 25.385 26.492 27,879 28.483 28,149 28,803 30 Other assets 2.576 3,086 4.633 4.884 5.374 5.277 5,680 5.850 6,389 6,197 31 Total payable in U.S. dollars 66,635 75,860 94,287 96,228 99,711 100,628 98,809 98,013 93,158 94,344 32 Claims on United States 4.100 5,113 10.746 10,285 11,620 11.071 10.988 8.790 7,831 7,922 33 Parent bank 3.431 4,386 9,297 8,467 9,778 9.179 9,059 6.810 5,629 5,928 34 Other 669 727 1.449 1.818 1,842 1.892 1,929 1,980 2,202 1,994 35 Claims on foreigners 61.408 69.416 81.294 83.603 85,452 86.818 85,013 86,404 82,434 83,361 36 Other branches of parent bank 18.947 22.838 28.928 29,907 30,204 29.980 28,466 28,692 26,083 25,565 37 Banks 28,530 31.482 36,760 38.185 37,768 39.159 38,594 39,050 38,471 39,070 38 Public borrowers2 1,669 3,317 3,319 3,253 4,589 4,277 4.277 4,396 4,280 4,327 39 Nonbank foreigners 12,263 11,779 12,287 12,258 12,891 13,402 13,676 14.266 13,600 14,399 40 Other assets 1.126 1,331 2.247 2.340 2,639 2.739 2.808 2.819 2,893 3,061 Bahamas and Caymans 41 Total, all currencies 79,052 91,735 108,977' 117,889 114,798 115,840 116,538 115,276 120,243 128,429 42 Claims on United States 5,782 9,635 19.124 27,155 21,832 20.060 21,406 17,682 18,240 25,846 43 Parent bank 3,051 6,429 15.196 22.414 17,323 15,269 15.334 10,660 10,497 19,129 44 Other 2,731 3,206 3.928 4.741 4.509 4.791 6.072 7,022 7,743 6,717 45 Claims on foreigners 71,671 79.774 86.718' 86.877 89.326 91,683 90,995 93,432 98,001 98,463 46 Other branches of parent bank 11,120 12.904 9.689 10.265 13.659 13,438 12,454 12.977 14,362 13,160 47 Banks 27,939 33.677 43.171' 42,470 44,485 47,212 46,782 48.012 50,780 51,712 48 Public borrowers2 9,109 11.514 12.905' 13.132 11,334 11,355 11.636 11,554 11,627 12,054 49 Nonbank foreigners 23,503 21.679 20.953' 21.010 19,848 19.678 20,123 20,889 21,232 21,537 50 Other assets 1,599 2,326 3.135' 3.857 3,640 4.097 4.137 4,162 4,002 4,120 51 Total payable in U.S. dollars 73,987 85,417 102,368' 111,553 108,599 109,728 110,872 109,726 114,474 122,581 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Overseas Branches A55 3.13 Continued 1980 LLiiaabbiilliittyy aaccccoouunntt 1977 19781 1979 Feb. Mar. Apr. May June' July Aug.P All foreign countries 52 Total, all currencies 258,897 306,795 364,233r 372,149' 371,533' 376,146' 378,899' 376,722 377,813 386,168 53 To United States 44,154 57,948 66,618' 71,148' 67,654' 69,570' 73,262' 76,296 83,150 87,479 54 Parent bank 24,542 28,590 24,462' 22,896' 22,413' 24,348' 26,603' 30,918 35,357 37,368 55 Other banks in United States 12,212 13,968 13,821 12,351 12,832 13,089' 12,431 11,414 14,708 56 Nonbanks 17,146 28,188 34,431 32,890 32,390 33,570' 32,947 36,379 35,403 57 To foreigners 206,579 238,912 283,344' 286,281' 289,484' 291,114' 289,755' 284,540 279,568 283,962 58 Other branches of parent bank 53,244 67,496 77,601 73,602 76,695 75,096 72,530' 72,061 72,067 69,003 59 Banks 94,140 97,711 122,849' 130,271' 129,338' 130,774' 130,876' 127,697 122,765 130,530 60 Official institutions 28,110 31,936 35,664 34,221 34,806 35,009 34,840 34,081 33,009 33,062 61 Nonbank foreigners 31,085 41,769 47,230 48,187 48,645 50,235 51,509 50,701 51,727 51,367 62 Other liabilities 8,163 9,935 14,27-1' 14,720' 14,395' 15,462' 15,882' 15,886 15,095 14,727 63 Total payable in U.S. dollars 198,572 230,810 273,819r 282,249' 282,715' 283,880' 285,131' 282,578 282,876 291,204 64 To United States 42,881 55,811 64,530' 68,629' 65,393' 67,215' 70,825' 73,703 80,629 84,251 65 Parent bank 24,213 27,519 23,403' 21,666' 21,225' 23,102' 25,279' 29,547 33,977 35,874 66 Other banks in United States 11,958 13,771 13,414 12,004 12,583 12,825' 12,161 11,154 14,016 67 Nonbanks 16,334 27,356 33,549 32,164 31,530 32,721' 31,995 35,498 34,361 68 To foreigners 151,363 169,927 201,476' 205,529' 209,174' 207,848' 205,264' 199,873 194,173 198,808 69 Other branches of parent bank 43,268 53,396 60,513 57,714 61,240 59,423 56,577 56,247 56,206 53,260 70 Banks 64,872 63,000 80,691 89,256' 88,081' 87,678' 87,072' 84,323 78,940 86,508 71 Official institutions 23,972 26,404 29,048 27,727 28,321 28,614 28,318 26,929 25,999 26,165 72 Nonbank foreigners 19,251 27,127 31,224 30,832 31,532 32,133 33,297' 32,374 33,028 32,875 73 Other liabilities 4,328 5,072 7,813' 8,091' 8,148' 8,817' 9,042' 9,002 8,074 8,145 United Kingdom 74 Total, all currencies 90,933 106,593 130,873 133,793 136,654 138,915 138,930 139,066 135,669 136,435 75 To United States 7,753 9,730 20,986 20,808 19,921 20,838 19,877 20,189 21,404 20,551 76 Parent bank 1,451 1,887 3,104 2,758 2,140 2,301 2,118 2,410 3,275 2,510 7 7 7 8 N O o th n e b r a n b k an s ks in United States 6,302 _ 4 3 , ,6 2 1 3 1 2 1 7 0 , , 6 1 9 8 3 9 1 6 1 , , 5 4 5 9 9 1 1 6 1 , , 5 2 0 7 2 9 1 6 2 , , 3 1 8 5 2 5 1 6 1 , , 2 4 6 9 5 4 1 6 1 , , 3 4 0 7 6 3 1 5 2 , , 5 5 6 6 7 2 1 5 2 , , 9 1 1 3 0 1 79 To foreigners 80,736 93,202 104,032 106,524 110,473 111,375 111,769 111,878 107,739 109,629 80 Other branches of parent bank 9,376 12,786 12,567 11,099 14,799 14,268 13,824 13,767 12,694 13,188 81 Banks 37,893 39,917 47,620 53,031 53,204 53,955 54,309 54,750 51,203 51,607 82 Official institutions 18,318 20,963 24,202 22,890 23,303 23,453 23,628 22,577 21,088 22,600 83 Nonbank foreigners 15,149 19,536 19,643 19,504 19,167 19,699 20,008 20,784 22,754 22,234 84 Other liabilities 2,445 3,661 5,855 6,461 6,260 6,702 7,284 6,999 6,526 6,255 85 Total payable in U.S. dollars 67,573 77,030 95,449 97,391 101,293 101,679 101,170 100,117 95,164 96,051 86 To United States 7,480 9,328 20,552 20,206 19,381 20,337 19,284 19,498 20,843 19,580 87 Parent bank 1,416 1,836 3,054 2,724 2,089 2,252 2,060 2,315 3,238 2,464 8 8 9 8 N O o th n e b r a n b k a s n ks in United States 6 064 4 3 , , 1 3 4 4 4 8 9 7 , , 8 65 4 1 7 1 6 1 , , 3 0 9 8 9 3 1 6 0 , , 3 9 5 4 1 1 1 6 1 , , 3 7 1 6 8 7 1 6 1 , , 2 0 1 1 0 4 1 6 0 , , 2 9 3 5 3 0 1 5 2 , , 4 1 8 1 6 9 1 5 1 , , 4 6 3 7 9 7 90 To foreigners 58,977 66,216 72,397 74,705 79,251 78,296 78,278 77,145 71,339 73,456 91 Other branches of parent bank 7,505 9,635 8,446 7,322 10,894 10,468 10,021 9,758 8,672 9,053 92 Banks 25,608 25,287 29,424 34,694 35,300 34,485 34,488 35,217 31,352 31,801 93 Official institutions 15,482 17,091 20,192 18,923 19,255 19,554 19,558 18,300 16,696 18,253 94 Nonbank foreigners 10,382 14,203 14,335 13,766 13,802 13,789 14,211 13,870 14,619 14,349 95 Other liabilities 1,116 1,486 2,500 2,480 2,661 3,046 3,608 3,474 2,982 3,015 Bahamas and Caymans 96 Total, all currencies 79,052 91,735 108,977' 117,889' 114,798' 115,840' 116,538' 115,276 120,243 128,429 97 To United States 32,176 39,431 37,719' 43,610' 40,926' 41,918' 45,617' 48,430 54,189 58,848 98 Parent bank 20,956 20,482 15,267' 15,129' 15,371' 17,066' 19,170' 22,748 26,589 29,189 1 9 0 9 0 O No th n e b r a n b k an s ks in United States 11 220 1 6 2 , , 0 8 7 7 3 6 1 5 7 , , 2 2 0 4 4 8 2 6 2 , , 3 1 5 3 1 0 2 4 0 , ,7 7 7 7 7 8 1 5 9 , , 4 4 1 3 7 5 20 5 , , 7 7 2 2 7 0 20 5, , 1 4 9 8 9 3 2 4 2 , , 8 7 2 8 0 0 2 7 2 , , 4 2 2 3 7 2 101 To foreigners 45,292 50,447 68,598' 71,151' 70,822' 70,602' 67,972' 63,936 63,172 66,622 102 Other branches of parent bank 12,816 16,094 20,875 22,150 22,387 22,470 20,009 20,102 20,409 18,081 103 Banks 24,717 23,104 33,631' 34,720' 33,792' 33,047' 32,175' 28,918 27,127 34,115 104 Official institutions 3,000 4,208 4,866 5,016 4,958 5,435 5,461 5,096 5,525 4,119 105 Nonbank foreigners 4,759 7,041 9,226 9,265 9,685 9,650 10,327 9,820 10,111 10,307 106 Other liabilities 1,584 1,857 2,660' 3,128' 3,050' 3,320' 2,949' 2,910 2,882 2,959 107 Total payable in U.S. dollars 74,463 87,014 103,460' 112,978' 110,123' 111,486' 112,509' 111,494 116,182 124,017 1. In May 1978 the exemption level for branches required to report was increased, rowers, including corporations that are majority owned by foreign governments, 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

A56 International Statistics • November 1980 3.14 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1980 IItteemm 11997777 11997788 11997799 Mar. Apr. May June July Aug J' Sept 1 Total1 131,097 162,589 149,466 142,069 140,500 143,460 149,169 153,057 154,655 156,446 By type 2 Liabilities reported by banks in the United States2 18.003 23.290 30.411 27.226 27.923 28.486 28.940 29.201 29.450 30,865 3 U.S. Treasury bills and certificates3 47.820 67.671 47.666 42.797 40.527 42.731 45.907 47.982 49.811 48,981 U.S. Treasury bonds and notes 4 Marketable 32.164 35.894 37.669 37.785 37.718 38.104 39.820 40.582 39.837 40,835 5 Nonmarketable4 20.443 20.970 17.387 16.7X4 16.384 16.184 15.954 15.954 15.654 15,254 6 U.S. securities other than U.S. Treasury securities5 12.667 14.764 16.333 17.477 17.948 17.955 18.548 19.338 19.903 20,511 By area 7 Western Europe1 70.748 93.089 85.602 77.119 74.154 74.159 75.246 •78.141 78,425 76.487 8 Canada 2.334 2.486 1.898 1.644 1.903 2.134 2.157 1.907 2.156 1.911 9 Latin America and Caribbean 4.649 5.046 6.371 6.099 5.979 6.035 6.023 6.378 6.130 6.692 10 Asia 50.693 58.817 52.697 53.997 54.403 57.317 62.163 62.988 64.191 67.608 11 Africa 1.742 2.408 2.412 2.419 3.316 2.889 2.694 2.930 3.281 3,232 12 Other countries6 931 743 486 791 745 926 886 713 472 516 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 agencics. 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 NOTU: 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 1979 1980 IItteemm 11997777 11997788 June Sept. Dec. Mar. June 1 Banks' own liabilities 925 2.347 1.978 2.393 1.870 2.237 2,562 2 Banks' own claims1 2.356 3.663 2.559 2.700 2.438 2.812 2,994 3 Deposits 941 1.798 1.371 1.356 1.032 1.212 1.048 4 Other claims 1.415 1.864 1.189 1.344 1.406 1.600 1,946 5 Claims of banks' domestic customers2 336677 557744'' 661166 559922 11..005566 779977 1. Includes claims of banks' domestic customers through March 1978. NOTL: Data on claims exclude foreign currencies held by U.S. monetary au- 2. Assets owned by customers of the reporting bank locqted 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

Nonbank-Reported Data A57 3.16 LIABILITIES TO FOREIGNERS Reported by Banks in the United States Payable in U.S. dollars Millions of dollars, end of period 1980 Holder and type of liability 1978 1979 Mar. Apr. May June July Aug. Sept .P 1 All foreigners 166,796 187,339 185,977 180,552 182,847 187,012 188,354R 201,311 191,492 2 Banks' own liabilities 78,699 117,146 119,118 115,586 116,323 116,811 116,645' 128,169 118,849 3 Demand deposits ...; 18.996 19,211 23.308 22,678 22.319 22,511 25,967 22,138' 22,511 22,455 4 Time deposits1 11.521 12,441 13,671 12,877 12,627 12,668 12,778 12,899 13,158 13,857 5 Other2 9.693 16,277 14,611 15,020 15,944 16,774 18,737 18,765 17,928 6 Own foreign offices3 37,353 63,890 68.951 65,620 65,200 61,292 62,871 73,735 64,608 7 Banks' custody liabilities4 88.098 70,193 66,859 64,966 66,524 70,201 71,708' 73,142 72,643 8 U.S. Treasury bills and certificates5 68,202 48,573 44,408 42,232 44,088 48,193 49,627 50.512 50,351 9 Other negotiable and readily transferable instruments6 17,396 19,270 19,701 19,944 19,643 19,433 19,349' 19,047 19,700 10 Other 2,499 2,350 2,750 2,790 2,793 2,575 2,732 2,584 2,592 11 Nonmonetary international and regional organizations7 3,274 2,607 2,351 1,758 1,968 1,775 3,504 2,903 2,821 2,551 12 Banks' own liabilities 906 709 383 648 377 847 607 502 478 13 Demand deposits 231 330 260 160 241 144 99 214 171 141 14 Time deposits1 139 84 151 79 93 88 92 93 101 100 15 Other2 492 298 144 314 145 657 299 230 238 16 Banks' custody liabilities4 1,701 1,643 1,376 1,320 1,398 2.657 2.296 2,319 2,073 17 U.S. Treasury bills and certificates 706 201 102 157 87 82 1,106 604 651 316 18 Other negotiable and readily transferable instruments6 1,499 1,538 1,218 1,233 1,317 1,551 1,692 1,668 1,757 19 Other 1 2 0 0 0 0 0 0 0 20 Official institutions8 65,822 90,706 78,077 70,023 68,450 71,218 74,848 77,183' 79,261 79,846 21 Banks' own liabilities 12,129 18,163 14,527 14,547 15,363 16,341 17,061 17,592 18,546 22 Demand deposits 3,528 3,390 4,704 3.928 4,734 4,484 5,042 4,218' 3,898 4,350 23 Time deposits1 1,797 2,550 3,041 2.397 2,392 2,581 2,670 2,695 2,959 3,502 24 Other2 6,189 10.418 8.202 7,421 8,297 8,628 10,148 10,735 10,695 25 Banks' custody liabilities4 78.577 59,914 55,497 53,903 55,854 58,507 60,122 61,670 61,300 26 U.S. Treasury bills and certificates5 47.820 67,415 47.666 42,797 40,527 42,731 45,907 47,982 49,811 48,981 27 Other negotiable and readily transferable instruments6 10,992 12,196 12,668 13,341 13,084 12,554 12,092 11,807 12,277 28 Other 170 52 32 35 40 45 48 52 42 29 Banks9 42,335 57,464 88,384 95,162 92,013 92,106 89,661 90,328R 100,899 90,364 30 Banks' own liabilities 52,674 83,383 89,381 86,198 86,279 84,270 84,846 95,585 85,020 31 Unaffiliated foreign banks 15,320 19,493 20,430 20,578 21,079 22,977 21,975 21,851 20,412 32 Demand deposits 10,933 11,249 13,257 13,371 12,681 13,003 14,986 12,974 13,427 12,974 33 Time deposits1 2,040 1,453 1,724 1,574 1,498 1,423 1,479 1.544 1,514 1,425 34 Other2 2,618 4,512 5,485 6,399 6,653 6,512 7,457 6,910 6,012 35 Own foreign offices3 37,353 63,890 68,951 65,620 65,200 61,292 62,871 73,735 64,608 36 Banks' custody liabilities4 4.790 5,000 5.781 5,815 5,828 5,392 5,482' 5,313 5,344 37 U.S. Treasury and certificates 141 300 422 675 771 764 594 557 577 361 38 Other negotiable and readily transferable instruments6 2.425 2,405 2,559 2.462 2,491 2,522 2,395' 2,435 2,533 39 Other 2,065 2,173 2,547 2.582 2,574 2,277 2,530 2,301 2,450 40 Other foreigners 16,020 18,526 19,033 18,121 17,748 18,999 17,940R 18,330 18,731 41 Banks' own liabilities 12,990 14,890 14,828 14.193 14,305 15,353 14,131 14,490 14,804 42 Demand deposits 4,304 4,242 5,087 5,219 4,663 4,880 5,840 4,732' 5,014 4,991 43 Time deposits 7,546 8,353 8,755 8,827 8,645 8,576 8,537 8,566 8,585 8,830 44 Other2 394 1,048 781 886 849 977 833 891 983 45 Banks' custody liabilities4 3,030 3,636 4,205 3,928 3,443 3,646 3,809 3.840 3,927 46 U.S. Treasury bills and certificates 285 382 777 847 511 586 484 473 693 47 Other negotiable and readily transferable instruments6 2,481 3,131 3,256 2,908 2,752 2,806 3,170 3,137 3,133 48 Other 264 123 172 173 180 254 154 231 100 49 MEMO: Negotiable time certificates of deposit in custody for foreigners 11,007 10,974 11,236 11,670 11,685 11,773 10,500 10,433 10,428 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 before 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

A58 International Statistics • November 1980 3.16 LIABILITIES TO FOREIGNERS Continued 1980 AArreeaa aanndd ccoouunnttrryy 11997777 11997788 11997799 Mar. Apr. May June July Aug. Sept .P 1 Total 126,168 166,796 187,339 185,977 180,552 182,847 187,012 188,354' 201,311 191,492 2 Foreign countries 122,893 164,190 184,987 184,218 178,584 181,072 183,508 185,451r 198,490 188,941 3 Europe 60,295 85,159 90,904 85,278 82,806 82,726 82,911 83,871 86,072 83,250 4 Austria 318 513 413 335 444 352 383 432 390 432 5 Belgium-Luxembourg 2,531 2,552 2,375 2.365 2,369 2,795 3,982 3,837 3,673 3,696 6 Denmark 770 1,946 1,092 613 615 588 553 534 525 528 7 Finland 323 346 398 484 522 435 438 433 403 311 8 France 5,269 9,208 10.401 11,004 11,303 10,839 11,272 12,178 12,596 12,332 9 Germany 7,239 17,286 12.935 8,618 5,320 5,427 6,954 7,626' 9,121 7,854 10 Greece 603 826 635 618 617 610 626 567 642 591 11 Italy 6,857 7,739 7.782 7,399 7,429 6,942 5,778 7,138 6,530 5,607 12 Netherlands 2,869 2,402 2,327 2,377 2,022 2,128 2,676 2,830 2,491 2,540 13 Norway 944 1,271 1,267 1,500 1,391 1,221 1,282 1,140 1,040 1,074 14 Portugal 273 330 557 314 537 339 391 398 506 571 15 Spain 619 870 1,259 1,242 1,418 1,386 1,366 1.371 1,491 1,356 16 Sweden 2.712 3,121 2,005 1,692 1,847 1,632 1,999 1,795' 1,861 1,826 17 Switzerland 12,343 18,225 17.954 15,625 14,859 14,517 14,736 14,359 14,252 13,619 18 Turkey 130 157 120 138 136 136 153 156 147 237 19 United Kingdom 14.125 14,265 24,694 26,810 27,187 27,247 24,192 22,579 22,925 22,957 20 Yugoslavia 232 254 266 115 122 144 254 190 135 169 21 Other Western Europe1 1.804 3,440 4,070 3,693 4,301 5,591 5,468 6,006 7,002 7,120 22 U.S.S.R 98 82 52 37 33 40 49 36 70 39 23 Other Eastern Europe2 236 325 302 300 334 354 357 267 271 392 24 Canada 4,607 6,969 7.379 8,507 8,048 8,201 9,157 9,228' 9,187 10,432 25 Latin America and Caribbean 23,670 31,606 49,633 51,583 48,874 48,953 46,975 49,301' 58, 228 48,586 26 Argentina 1,416 1,484 1,582 1,582 1,679 1,903 1,705 1,841' 1,880 1,875 27 Bahamas 3,596 6,752 15,354 16,352 14,454 16,535 12,887 13,173 21,167 14,013 28 Bermuda 321 428 430 534 479 512 576 464 571 677 29 Brazil 1,396 1,125 1,005 1,367 1.645 1,527 1,454 1,474 1,378 1,170 30 British West Indies 3,998 5,991 11,074 11,812 11,585 9,571 10,369 12,072 13,344 11,204 31 Chile 360 399 469 445 444 416 450 453 475 431 32 Colombia 1,221 1,756 2,617 2,825 2,905 2,780 2,854 2,932 2,893 2,916 33 Cuba 6 13 13 6 23 7 6 6 7 5 34 Ecuador 330 322 425 459 357 337 455 346 818 381 35 Guatemala3 416 414 426 403 350 360 373 372 373 36 Jamaica3 52 76 97 132 138 91 137 100 101 37 Mexico 2,876 3,417 4,096 4,001 4,302 4,111 3,918 4,208' 4,202 4,121 38 Netherlands Antilles 196 308 499 419 411 335 250 332 314 357 39 Panama 2,331 2,968 4,483 4,418 4,505 4,082 4,176 4,685 4,617 3,922 40 Peru 287 363 383 363 392 412 346 350 401 355 41 Uruguay 243 231 202 240 216 208 232 232 241 199 42 Venezuela 2.929 3,821 4,192 4,075 3,104 3,953 4,707 4,350 3,692 4,405 43 Other Latin America and Caribbean 2,167 1760 2,318 2.161 1,837 1,775 2,139 1,873 1,755 2,080 44 Asia 30,488 36,492 32,928 34,222 33,519 35,984 39,468 38,020' 39,850 41,877 China 45 Mainland 53 67 49 34 35 30 44 38 37 38 46 Taiwan 1,013 502 1,393 1,188 1,076 1,396 1,524 1,438 1,552 1,595 47 Hong Kong 1,094 1,256 1,672 1,897 1,857 1,944 2,270 2,186 1,991 2,113 48 India 961 790 527 558 576 740 633 494 631 619 49 Indonesia 410 449 504 658 935 670 807 849 632 827 50 Israel 559 688 707 759 560 570 584 488 569 533 51 Japan 14,616 21,927 8,907 9.651 9,383 10,792 12,430 12,547' 14,059 15,476 52 Korea 602 795 993 1,069 1,008 988 1,087 1,482' 1,473 1,994 53 Philippines 687 644 800 669 789 885 883 935 778 815 54 Thailand 264 427 277 414 407 472 405 405 304 517 55 Middle-East oil-exporting countries4 8,979 7,534 15,217 15,686 15,189 15,724 16,792 15,350' 15,791 15,380 56 Other Asia 1,250 1,414 1,881 1,638 1,704 1,771 2,010 1,808' 2,033 1,970 57 Africa 2,535 2,886 3,239 3.325 4,203 3,810 3,708 3,792 4,218 3,902 58 Egypt 404 404 475 318 438 376 346 447 347 322 59 Morocco 66 32 33 31 41 31 35 33 47 32 60 South Africa 174 168 184 313 294 316 325 360 404 354 61 Zaire 39 43 110 102 84 86 107 78 38 42 62 Oil-exporting countries5 1,155 1,525 1,635 1,660 2,462 2,231 2,100 2,094 2,685 2,459 63 Other Africa 698 715 804 901 885 768 796 779 697 694 64 Other countries 1.297 1076 904 1,304 1,133 1,397 1,290 1,239 936 894 65 Australia 1.140 838 684 992 881 1,150 1,019 959 692 613 66 All other 158 239 220 312 252 247 271 281 243 281 67 Nonmonetary international and regional organizations 3,274 2,607 2,351 1,758 1,968 1,775 3,504 2,903 2,821 2,551 68 International 2,752 1,485 1,238 652 863 696 2,394 1,804 1,737 1,391 69 Latin American regional 278 808 806 746 813 790 807 785 800 837 70 Other regional6 245 314 308 361 292 289 302 314 285 323 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

Nonbank-Reported Data A59 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 1980 AArreeaa aanndd ccoouunnttrryy 11997777 11997788 11997799 Mar. Apr. May June July Aug. Sept .P 1 Total 90,206 115,479 133,762 130,775 133,331 139,730 149,447 151,196r 161,920 161,309 2 Foreign countries 90,163 115,423 133,730 130,739 133,298 139,696 149,413 151,165' 161,882 161,275 3 Europe 18,114 24,232 28,389 25,810 24,525 26,206 29,707 28,439' 29,386 29,892 4 Austria 65 140 284 331 337 292 305 309 280 351 5 Belgium-Luxembourg 561 1,200 1,339 1,631 1,590 1,471 1,866 1,622 1,881 1,867 6 Denmark 173 254 147 207 203 168 167 149' 164 180 7 Finland 172 305 202 188 223 273 307 223' 215 184 8 France 2,082 3,735 3,302 2,984 2,811 2,740 2,689 2,582' 3,288 3,232 9 Germany 644 845 1,159 1,308 1,153 1,104 1,131 1,004' 1,131 1,018 10 Greece 206 164 154 191 244 329 346 279 265 221 11 Italy 1,334 1,523 1,631 1,488 1,462 1,748 1,940 2,295 2,433 2,569 12 Netherlands 338 677 514 535 480 457 590 492 628 546 13 Norway 162 299 276 254 170 172 219 270 231 248 14 Portugal 175 171 330 227 247 246 300 346 334 330 15 Spain 722 1,120 1,051 914 1,020 1,106 1,189 1,011' 1,139 1,106 16 Sweden 218 537 542 593 618 661 677 534 558 716 17 Switzerland 564 1,283 1,166 1,356 826 916 1,237 1,319' 1,581 1,337 18 Turkey 360 300 149 123 132 151 144 143 137 144 19 United Kingdom 8,964 10,172 13,789 10,950 10,462 11,851 14,026 13,175' 12,631 13,243 20 Yugoslavia 311 363 611 598 593 614 658 648 647 601 21 Other Western Europe1 86 122 175 225 330 266 203 170 172 244 22 U.S.S.R 413 366 290 253 257 247 289 531 232 321 23 Other Eastern Europe2 566 657 1,277 1,453 1,366 1,394 1,424 1,336 1,438 1,434 24 Canada 3,355 5,152 4,143 4,186 3,923 4,283 5,272. 4,654' 4,775 5,250 25 Latin America and Caribbean 45,850 57,443 67,925 65,152 68,257 71,653 74,100 78,703' 87,817 85,574 26 Argentina 1,478 2,281 4,417 4,969 4,992 5,117 5,226 5,234 5,393 5,629 27 Bahamas 19,858 21,428 18,828 19,262 21,045 23,297 25,093 28,710' 30,495 30,348 28 Bermuda 232 184 496 313 321 296 175 194 256 216 29 Brazil 4,629 6,251 7,731 8,010 8,112 8,064 8,316 9,002 9,217 9,633 30 British West Indies 6,481 9,692 9,762 7,364 8,584 9,042 8,667 8,637 14,570 11,789 31 Chile 675 972 1,442 1,367 1,334 1,355 1,367 1,359 1,487 1,626 32 Colombia 671 1,012 1,614 1,526 1,539 1,408 1,435 1,448 1,490 1,491 33 Cuba 10 0 4 4 5 4 4 4 3 7 34 Ecuador 517 705 1,025 1,023 1,011 1,007 1,058 1,051 1,136 1,111 35 Guatemala3 94 134 109 108 107 120 153 102 105 36 Jamaica3 40 47 42 43 43 36 31 31 33 37 Mexico 4,909 5,479 9,095 9,231 9,191 9,726 10,239 10,660 10,750 11,107 38 Netherlands Antilles 224 273 248 513 663 693 728 760 729 710 39 Panama 1,410 3,098 6,031 4,652 4,643 4,538 4,952 4,552 4,931 4,404 40 Peru 962 918 652 701 654 628 711 647 687 671 41 Uruguay 80 52 105 90 84 154 103 91 105 100 42 Venezuela 2,318 3,474 4,695 4,457 4,231 4,528 4,295 4,469 4,737 4,879 43 Other Latin America and Caribbean 1,394 1,490 1,598 1,520 1,696 1,646 1,576 1,700 1,697 1,715 44 Asia 19,236 25,386 30,625 32,827 33,912 34,902 37,261 36,260' 36,907 37,440 China 45 Mainland 10 4 35 49 48 40 75 68 50 112 46 Taiwan 1,719 1,499 1,821 1,524 1,626 1,889 2,100 2,224 2,284 2,489 47 Hong Kong 543 1,479 1,804 1,888 2,001 2,362 2,269 2,174 2,063 2,099 48 India 53 54 92 120 87 61 83 97 118 84 49 Indonesia 232 143 131 132 166 128 155 205 245 208 50 Israel 584 888 990 734 829 828 1,028 950 1,012 919 51 Japan 9,839 12,671 16,921 19,433 20,311 20,395 21,606 20,575' 21,187 20,501 52 Korea 2,336 2,282 3,796 4,726 4,853 5,057 5,417 5,521' 5,462 5,568 53 Philippines 594 680 737 696 693 717 780 881 1,019 1,169 54 Thailand 633 758 935 877 857 918 922 939 947 947 55 Middle East oil-exporting countries4 1,746 3,125 1,548 1,437 1,178 978 1,262 1,120 1,040 1,467 56 Other Asia 947 1,804 1,813 1,211 1,263 1,530 1,564 1,506 1,480 1,877 57 Africa 2,518 2,221 1,795 1,729 1,800 1,770 2,016 2,166 1,977 2,027 58 Egypt 119 107 112 128 135 134 95 112 135 123 59 Morocco 43 82 103 118 128 107 121 134 180 166 60 South Africa 1,066 860 445 337 362 465 616 691 469 535 61 Zaire 98 164 144 143 143 108 107 107 98 101 62 Oil-exporting countries5 510 452 391 353 443 325 364 365 349 374 63 Other 682 556 600 649 588 632 714 757 746 728 64 Other countries 1,090 988 855 1,035 880 883 1,056 943 1,021 1,091 65 Australia 905 877 673 803 713 695 860 743 794 878 66 All other 186 111 182 232 167 187 196 200 227 213 67 Nonmonetary international and regional organizations6 43 56 32 36 33 34 34 31 38 34 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

A60 International Statistics • November 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 1980 TTyyppee ooff ccllaaiimm 11997777 11997788 11997799 Mar. Apr. May June July Aug. Sept .P 1 Total 9900,,220066 111111122222226666666,,,,,,,666666699999998888888 111111155555553333333,,,,,,,777777711111110000000 111111155555553333333,,,,,,,111111144444447777777 111111177777774444444,,,,,,,555555566666663333333 2 Banks' own claims on foreigners 111111111111115555555.......444444477777779999999 111111133333333333333.......777777766666662222222 111111133333330000000.......777777777777775555555 133.331 139.730 111111144444449999999.......444444444444447777777 151,196' 161.920 161,309 3 Foreign public borrowers 11111110000000.......222222266666663333333 11111115555555.......444444433333334444444 11111115555555.......444444422222228888888 15.151 15.105 11111115555555,,,,,,,777777722222223333333 16,444 17.207 18,773 4 Own foreign offices1 44444441111111.......555555500000002222222 44444447777777.......333333300000005555555 44444445555555.......222222244444448888888 46.163 50.108 55555556666666.......000000066666664444444 58,499' 62.676 61.811 5 Unaffiliated foreign banks 44444440000000,,,,,,,555555533333338888888 44444441111111.......000000011111116666666 33333339999999.......666666699999992222222 40.990 42.896 44444444444444.......000000066666661111111''''''' 42,007' 47.510 45.863 6 Deposits 5555555,,,,,,,444444488888880000000 6666666.......222222255555553333333 5555555.......444444477777779999999 6.093 6.504 6666666.......555555577777773333333 6,176' 7.260 7,284 7 Other 33333335555555.......000000055555558888888 33333334444444.......777777766666662222222 33333334444444.......222222211111113333333 34.897 36.392 33333337777777,,,,,,,444444488888888888888 35.832' 40.249 38.580 8 All other foreigners 22222223333333.......111111177777776666666 33333330000000.......000000000000007777777 33333330000000.......444444400000007777777 31.027 31.621 33333333333333,,,,,,,666666600000000000000 34.245 34,528 34,861 9 Claims of banks' domestic customers2 11111111111111.......222222211111119999999 11111119999999.......999999944444448888888 22222222222222.......333333377777772222222 22222225555555,,,,,,,111111111111116666666 10 Deposits 444444488888880000000 999999955555555555555 1111111.......222222200000008888888 999999911111110000000 1111 NNeeggoottiiaabbllee aanndd rreeaaddiillyy ttrraannssffeerraabbllee iinnssttrruummeennttss33 .... 5555555.......333333388888885555555 11111112222222.......999999977777774444444 11111114444444.......555555555555559999999 11111117777777.......444444411111110000000 1122 OOuuttssttaannddiinngg ccoolllleeccttiioonnss aanndd ootthheerr ccllaaiimmss44 66..117766 5555555.......333333355555553333333 6666666.......000000011111119999999 6666666.......666666600000005555555 6666666.......777777799999996666666 13 MEMO: Customer liability on acceptances 11111114444444.......999999966666669999999 11111118888888.......000000044444444444444 22222220000000.......000000099999995555555 22222222222222,,,,,,,111111133333334444444 Dollar deposits in banks abroad, reported by nonbanking business enterprises in the United States5 1133..111133 2211..336644 2244..994499 2244..119955'' 2244,,669922'' 2233,,119955'' 2244..777777'' 2233,,556644 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 certifbanks: principally amounts due from head office or parent foreign bank, and icates of deposit denominated in U.S. dollars issued by banks abroad. For deforeign 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 MMaattuurriittyy;; bbyy bboorrrroowweerr aanndd aarreeaa Dec. Mar. June Sept. Dec. Mar. June 1 Total 73,773 71,638 77,738 87,571 86,209 85,265 92,145 By borrower 2 Maturity of 1 year or less1 58.481 55.459 60,069 68,390 65.195 63.901 70,772 3 Foreign public borrowers 4.583 4.627 4.604 6,062 7.033 6.843 6,913 4 All other foreigners 53.898 50.832 55,465 62,329 58,162 57.058 63,859 5 Maturity of over 1 year1 15.291 16.179 17,669 19,181 21.014 21.364 21,373 6 Foreign public borrowers 5.361 5.948 6,433 7.652 8,103 8.419 8,536 7 All other foreigners 9.930 10.231 11.236 11.529 12.911 12.945 12,838 By area Maturity of 1 year or less1 8 Europe 15.176 12.396 14.028 16.794 15.209 13.850 17,121 9 Canada 2.670 2.514 2.703 2.471 1.777 1.818 2,099 10 Latin America and Caribbean 20.990 21.724 23.144 25.687 24,964 23.177 24.241 11 Asia 17.579 16.992 18,191 21.515 21.673 23.386 25,299 12 Africa 1.496 1.290 1.438 1.399 1.078 1,043 1,307 13 All other2 569 541 565 524 493 627 705 Maturity of over 1 year1 14 Europe 3.142 3.103 3.488 3.658 4.145 4.253 4,058 15 Canada 1.426 1.456 1.221 1.364 1.317 1.214 1,194 16 Latin America and Caribbean 8.466 9.325 10.279 11.771 12.821 13.397 13,846 17 Asia 1.407 1.486 1.884 1.578 1.911 1,728' 1,562 18 Africa 637 629 614 623 652 620 567 19 All other2 214 ISO 183 188 169 152 146 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

Nonbank-Reported Data A61 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 AArreeaa oorr ccoouunnttrryy 11997766 11997777 June2 Sept. Dec. Mar. June Sept. Dec. Mar. June^ 1 Total 206.8 240.0 247.1 247.6 266.3 264.0 275.6 294.0 303.8 307.5 326.8 2 G-10 countries and Switzerland 100.3 116.4 112.6 113.5 124.8 119.1 125.3 135.8 138.4 140.4 153.7 3 Belgium-Luxembourg 6.1 8.4 8.3 8.4 9.0 9.4 9.7 10.7 11.1 10.8 13.2 4 France 10.0 11.0 11.4 11.7 12.2 11.7 12.7 12.0 11.6 12.0 14.1 5 Germany 8.7 9.6 9.1 9.7 11.3 10.5 10.8 12.8 12.2 11.4 12.7 6 Italy 5.8 6.5 6.4 6.1 6.7 5.7 6.1 6.1 6.4 6.2 6.9 7 Netherlands 2.8 3.5 3.4 3.5 4.4 3.9 4.0 4.7 4.8 4.3 4.5 8 Sweden 1.2 1.9 2.1 2.2 2.1 2.0 2.0 2.3 2.4 2.4 2.7 9 Switzerland 3.0 3.6 4.1 4.3 5.4 4.5 4.8 5.0 4.8 4.4 3.4 10 United Kingdom 41.7 46.5 44.9 44.2 47.3 46.4 50.3 53.7 56.4 57.5 64.6 11 Canada 5.1 6.4 5.1 4.9 6.0 5.9 5.5 6.0 6.3 6.8 6.9 12 Japan 15.9 18.8 17.9 18.5 20.6 19.0 19.5 22.3 22.4 24.7 24.8 13 Other developed countries 15.0 18.6 19.4 18.7 19.4 18.2 18.2 19.7 19.8 18.8 20.3 14 Austria 1.2 1.3 1.5 1.5 1.7 1.7 1.8 2.0 2.0 1.7 1.8 15 Denmark 1.0 1.6 1.7 1.9 2.0 2.0 1.9 2.0 2.2 2.1 2.2 16 Finland 1.1 1.2 1.1 1.0 1.2 1.2 1.1 1.2 1.2 1.1 1.3 17 Greece 1.7 2.2 2.3 2.2 2.3 2.3 2.2 2.3 2.4 2.4 2.5 18 Norway 1.5 1.9 2.1 2.1 2.1 2.1 2.1 2.3 2.3 2.4 2.4 19 Portugal .4 .6 .6 .5 .6 .6 .5 .7 .7 .6 .6 20 Spain 2.8 3.6 3.6 3.5 3.5 3.0 3.0 3.3 3.5 3.5 3.9 21 Turkey 1.3 1.5 1.4 1.5 1.5 1.4 1.4 1.4 1.4 1.4 1.4 22 Other Western Europe .7 .9 1.2 .9 1.3 1.1 1.0 1.5 1.4 1.4 1.6 23 South Africa 2.2 2.4 2.4 2.2 2.0 1.7 1.8 1.7 1.3 1.1 1.5 24 Australia 1.2 1.4 1.4 1.3 1.4 1.3 1.4 1.3 1.3 1.2 1.2 25 OPEC countries3 12.6 17.6 19.2 20.4 22.7 22.6 22.7 23.4 22.9 21.9 20.9 26 Ecuador .7 1.1 1.4 1.6 1.6 1.5 1.6 1.6 1.7 1.8 1.8 27 Venezuela 4.1 5.5 5.6 6.2 7.2 7.2 7.6 7.9 8.7 7.9 7.9 28 Indonesia 2.2 2.2 1.9 1.9 2.0 1.9 1.9 1.9 1.9 1.9 1.9 29 Middle East countries 4.2 6.9 8.4 8.7 9.5 9.4 9.0 9.2 8.0 7.8 6.9 30 African countries 1.4 1.9 1.9 2.0 2.5 2.6 2.6 2.8 2.6 2.5 2.5 31 Non-OPEC developing countries 44.2 48.7 49.1 49.6 52.6 53.9' 55.9 58.8 62.8 63.8 67.1 Latin America 32 Argentina 1.9 2.9 3.0 2.9 3.0 3.1 3.5 4.1 5.1 5.6 5.5 33 Brazil 11.1 12.7 13.3 14.0 14.9 14.9 15.1 15.1 15.2 15.0 15.4 34 Chile .8 .9 1.3 1.3 1.6 1.7 1.8 2.2 2.5 2.5 2.6 35 Colombia 1.3 1.3 1.3 1.3 1.4 1.5 1.5 1.7 2.2 2.1 2.2 36 Mexico 11.7 11.9 11.0 10.7 10.8 10.9 10.7 11.4 12.0 12.2 13.4 37 Peru 1.8 1.9 1.8 1.8 1.7 1.6 1.4 1.4 1.5 1.3 1.4 38 Other Latin America 2.8 2.6 3.3 3.4 3.6 3.5 3.3 3.6 3.7 3.6 3.6 Asia China 39 Mainland .0 .0 .0 .0 .0 .1 .1 .1 .1 .1 .1 40 Taiwan 2.4 3.1 2.5 2.4 2.9 3.1 3.3 3.4 3.6 3.8 41 India .2 .3 .2 .2 .2 .2 .2 .2 .2 42 Israel 1.0 .9 .7 1.0 1.0 .9 1.3 .9 1.2 43 Korea (South) 3.1 3.9 3.6 3.9 4.2 5.0 5.3 5.5 6.5 7.0 44 Malaysia4 .5 .7 .6 .6 .6 .7 .9 .8 .9 45 Philippines 2.2 2.5 2.7 2.8 3.2 3.7 3.7 4.2 4.4 4.6 46 Thailand .7 1.1 1.1 LI 1.2 1.2 1.4 1.6 1.4 1.5 47 Other Asia .5 .4 .3 .2 .3 .4 .4 .4 .5 Africa 48 Egypt .4 .3 .3 .4 .4 .5 ..77 .6 .6 .7 .7 49 Morocco .3 .5 .5 .5 .6 .6 .5 .5 .6 .5 .5 50 Zaire .2 .3 .2 .2 .2 .2 .2 .2 .2 .2 .2 51 Other Africa5 1.2 .7 1.2 1.3 1.4 1.4 1.5 1.6 1.7 1.8 1.9 52 Eastern Europe 5.2 6.3 6.4 6.6 6.9 6.7 6.7 7.2 7.3 7.3 7.2 53 U.S.S.R 1.5 1.6 1.4 1.4 1.3 1.1 .9 .9 .7 .6 .5 54 Yugoslavia .8 1.1 1.3 1.3 1.5 1.6 1.7 1.8 1.8 1.9 2.1 55 Other 2.9 3.7 3.7 3.9 4.1 4.0 4.1 4.6 4.8 4.9 4.6 56 Offshore banking centers 24.7 26.1 32.4 30.2 30.9 33.7 37.0 38.6 40.4 42.4 43.4 57 Bahamas 10.1 9.8 12.1 11.6 10.3 12.1 14.3 12.9 13.7 13.7 13.0 58 Bermuda .5 .6 .7 .7 .7 .6 .7 .7 .8 .6 .6 59 Cayman Islands and other British West Indies 3.8 3.8 7.2 6.8 7.4 7.2 7.5 9.5 9.4 11.3 9.7 60 Netherlands Antilles .6 .7 .6 .6 .8 .8 1.0 1.1 1.2 .9 1.2 61 Panama6 3.0 3.1 3.3 3.1 3.0 3.4 3.8 3.4 4.3 4.9 5.6 62 Lebanon .1 .2 .1 .1 .1 .1 .1 .2 .2 .2 .2 63 Hong Kong 2.2 3.7 4.1 4.0 4.2 4.8 4.9 5.5 6.0 5.7 6.9 64 Singapore 4.4 3.7 3.8 2.9 3.9 4.2 4.2 4.9 4.5 4.7 5.9 65 Others7 .0 .5 .5 .5 .5 .4 .4 .4 .4 .4 .4 66 Miscellaneous and unallocated8 5.0 5.3 8.1 8.6 9.1 9.5 9.9 10.6 11.7 13.1 14.4 1. The banking offices covered by these data are the U.S. offices and foreign the claims of the U.S. offices also include customer claims and foreign currency branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks. claims (amounting in June 1978 to $10 billion). Offices not covered include (1) U.S. agencies and branches of foreign banks, and 3. In addition to the Organization of Petroleum Exporting Countries shown (2) foreign subsidiaries of U.S. banks. To minimize duplication, the data are individually, this group includes other members of OPEC (Algeria, Gabon, Iran, adjusted to exclude the claims on foreign branches held by a U.S. office or another Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, and United Arab Emirates) foreign branch of the same banking institution. The data in this table combine as well as Bahrain and Oman (not formally members of OPEC). 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. in this table include only banks' own claims payable in dollars. For earlier dates Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 International Statistics • November 1980 3.21 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Holdings and Transactions Millions of dollars 1980 1980 CCoouunnttrryy oorr aarreeaa 11997788 11997799 Jan.- Sept. Mar. Apr. May June July Aug. Sept.P Holdings (end of period)1 1 Estimated total2 44,938 50,307 52,997 52,091 51,371 53,131 53,819 53,056 54,804 2 Foreign countries2 39.817 44.875 46.534 46.430 46,907 48,727 49.523 48,924 50,105 3 Europe2 17.072 23.705 24.611 24.008 24.075 24,377 24.157 23,541 23,914 4 Belgium-Luxembourg 19 60 27 28 28 28 45 89 91 5 Germany2 8.705 12.937 13.489 13.207 13,225 12,976 12,578 11,978 11,991 6 Netherlands 1,358 1,466 1.453 1,473 1,412 1,437 1,547 1,522 1,640 7 Sweden 285 647 633 642 653 647 650 640 611 8 Switzerland2 977 1.868 1.534 1,528 1,574 1,731 1.675 1,675 1,566 9 United Kingdom 5.373 6.236 6.995 6.603 6.665 7,001 7.091 7,106 7,473 10 Other Western Europe 354 491 478 527 519 556 571 531 542 11 Eastern Europe 12 Canada 152 232 394 381 385 423 481 469 480 13 Latin America and Caribbean 416 546 552 581 592 696 770 786 848 14 Venezuela 144 183 183 183 183 280 328 341 382 15 Other Latin America and Caribbean 110 200 206 199 209 215 242 240 241 16 Netherlands Antilles 162 163 164 199 200 200 200 205 225 17 Asia 21,488 19.804 20,390 20.872 21.269 22.751 23,534 23,545 24,252 18 Japan 11.528 11.175 9.631 9.533 9.543 9,545 9,614 9.465 9,444 19 Africa 691 591 591 593 593 492 592 592 617 20 All other -3 -3 -3 -6 -7 -11 -11 -10 -5 21 Nonmonetary international and regional organizations 5.121 5,432 6.463 5.661 4,464 4,404 4,296 4,132 4,699 22 International 5.089 5.388 6.407 5,606 4,401 4.338 4,234 4,066 4,632 23 Latin American regional 33 40 53 53 63 63 63 63 67 Transactions (net purchases, or sales (-) during period) 24 Total2 6,297 5,368 4,501 -207 -906 -717 1,757 692 -767 1,752 25 Foreign countries2 5,921 5,059 5,230 -22 - 105 478 1,820 795 -598 1,181 26 Official institutions 3,729 1.776 3.166 -103 -67 386 1,716 762 -745 998 27 Other foreign2 2,193 3.284 2.062 79 -37 92 104 33 146 183 28 Nonmonetary international and regional organizations 375 312 -728 -185 -802 -1,195 -63 -104 -168 571 MEMO: Oil-exporting countries 29 Middle East3 -1,785 -1,015 5.763 1.014 471 462 1,427 598 140 601 30 Africa4 332299 --110000 2255 -- 110000 110000 2255 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 1980 Assets 1977 1978 1979 Apr. May June July Aug. Sept. Oct.P 1 Deposits 424 367 429 618 380 691 436 336 460 368 Assets held in custody 2 U.S. Treasury securities1 91.962 117.126 95,075 85,717 88.489 93.661 95,525 96,504 96,227 98,121 3 Earmarked gold2 15,988 15,463 15.169 15.087 15.034 15.034 15,034 15,025 14,987 14,986 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 A 63 3.23 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1980 1980 . , 1Q7« 1Q70 Jan.- Sept. Mar. Apr. May June July Aug. Sept.P U.S. corporate securities STOCKS 1 Foreign purchases 20.145 22,643 26.957 2,724 1,985 1.940 2,550 3,080' 3,505 3,569 2 Foreign sales 17.723 21,017 23,652 2,380 1.719 1,958 2,390 2.781 3,301 3,329 3 Net purchases, or sales (-) 2,423 1,627 3,305 344 266 -17 160 299' 203 241 4 Foreign countries 2,469 1,610 3,306 342 263 -19 162 296' 205 246 5 Europe 1.283 217 1,882 156 129 105 56 115' 42 -83 6 France 47 122 260 -49 14 23 9 62 30 -33 7 Germany 620 -221 21 -25 3 -14 -5 -13' -21 -18 8 Netherlands -22 -71 -225 -6 -30 -40 -25 -27 -26 -38 9 Switzerland -585 -519 50 -36 -75 -17 -19 -82 -127 -123 10 United Kingdom 1.230 964 1,780 277 194 106 99 188 216 153 11 Canada 74 552 420 130 66 -42 24 81 13 -22 12 Latin America and Caribbean 151 -19 -33 -49 6 -4 27 -25 -32 -83 13 Middle East1 781 656 990 97 145 -60 20 130 183 410 14 Other Asia 189 211 14 8 -81 -21 28 -5 -22 19 15 Africa -13 - 14 - 1 2 0 0 -2 -1 0 2 16 Other countries 3 7 33 -2 -2 3 8 2 21 4 17 Nonmonetary international and regional organizations -46 17 0 2 3 2 -2 2 -2 -5 BONDS2 18 Foreign purchases 7,975 8,826 11,564 1,237 1,654 1,329 1,834 1.695 1,087 645 19 Foreign sales 5,681 7.575 7,243 838 1,137 1,011 1,152 898 589 476 20 Net purchases, or sales (-) 2,294 1,251 4,322 399 518 318 682 797 498 169 21 Foreign countries 1,885 1,351 4,057 407 568 249 625 769 475 218 22 Europe 744 639 1,093 315 251 92 105 129 27 -18 23 France 30 11 103 15 7 47 12 8 6 -2 24 Germany 6 72 155 11 104 104 -14 -50 -11 8 25 Netherlands 12 -202 -82 0 -14 -14 6 -26 -7 7 26 Switzerland -202 -118 31 3 79 -29 -10 -16 -9 0 27 United Kingdom 930 814 886 265 36 -34 110 196 53 -5 28 Canada 102 89 112 8 2 9 5 -2 25 12 29 Latin America and Caribbean 98 109 172 9 13 25 23 29 32 18 30 Middle East1 810 424 2,600 79 295 104 483 600 382 194 31 Other Asia 131 88 64 -4 7 17 5 13 9 14 32 Africa -1 1 4 0 0 1 0 0 0 0 33 Other countries 1 1 11 0 0 0 4 1 0 -2 34 Nonmonetary international and regional organizations 409 -101 266 -8 -50 68 57 28 23 -49 Foreign securities 35 Stocks, net purchases, or sales ( -) 527 -786 -1,916 -2 -40 -241 -164 -76 -201 -534 36 Foreign purchases 3.666 4.615 5,374 665 402 450 491 654 605 676 37 Foreign sales 3.139 5,401 7,290 667 442 691 655 731 805 1,211 38 Bonds, net purchases, or sales (-) - 4.054 -3,970 -961 17 -12 -251 -618 374 -259 -91 39 Foreign purchases 11,043 12,375 12.333 1,181 1,072 1,479 1,637 1,725' 1,374 1,221 40 Foreign sales 15.096 16,345 13.295 1.164 1,084 1,730 2,255 1,351' 1,634 1,312 41 Net purchases, or sales (-), of stocks and bonds .. -3,527 -4,756 -2,877 15 -52 -491 -781 298' -460 -625 42 Foreign countries -3,340 -4,006 -3,339 -33 -72 -498 -800 -32' -384 -661 43 Europe -65 -1,640 -931 54 -80 -214 -474 10' -176 -101 44 Canada -3,238 -2,609 -1.765 -161 3 -256 -283 -29 42 336 45 Latin America and Caribbean 201 348 195 29 14 45 -25 34 -14 7 46 Asia 349 -108 -951 49 -12 -82 -65 -55' -313 -223 47 Africa -441 -23 4 0 3 4 3 1' 0 -4 48 Other countries -146 25 108 -3 0 5 44 7 76 -4 49 Nonmonetary international and regional organizations -187 -750 462 48 20 7 19 330 -76 36 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

A64 International Statistics • November 1980 3.24 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1979 1980 TTyyppee,, aanndd aarreeaa oorr ccoouunnttrryy 11997788 11997799 Mar. June Sept. Dec. Mar.' Jun e.P 1 Total 14,860 16,910 14,470 15,452 15,653 16,910 17,370 18,500 2 Payable in dollars 11.496 13,916 11,493 12,579 12.667 13,916 14,437 15,145 3 Payable in foreign currencies2 3.363 2.994 2,977 2.872 2,986 2,994 2,933 3,354 By type 4 Financial liabilities 6,305 7,286 6,047 6,024 6.100 7,286 7,799 8,303 5 Payable in dollars 3.841 5.083 3,789 3,861 3,864 5,083 5,618 5,757 6 Payable in foreign currencies 2.464 2.203 2,258 2,164 2,236 2,203 2,182 2,546 7 Commercial liabilities 8,555 9.624 8,423 9,428 9,553 9,624 9,571 10,197 8 Trade payables 3.989 4.369 3,501 4,259 4,035 4,369 4,138 4,299 9 Advance receipts and other liabilities 4.566 5.255 4,922 5.168 5,518 5,255 5,433 5,898 10 Payable in dollars 7.656 8,834 7,703 8.719 8,802 8,834 8,819 9,388 11 Payable in foreign currencies 899 790 719 709 750 790 752 809 By area or country Financial liabilities 12 Europe 3.903 4,554 3,650 3.557 3,682 4,554 4,813 5,389 13 Belgium-Luxembourg 289 345 266 355 317 345 360 413 14 France 167 168 139 134 126 168 188 341 15 Germany 366 497 311 283 381 497 520 668 16 Netherlands 390 834 422 401 542 834 801 804 17 Switzerland 248 168 244 235 190 168 172 231 18 United Kingdom 2.110 2,347 2,054 1,930 1.927 2,347 2,568 2,763 19 Canada 244 445 252 290 304 445 383 482 20 Latin America and Caribbean 1.357 1,483 1,346 1,395 1,347 1,483 1,761 1,632 21 Bahamas 426 347 411 442 355 347 459 433 22 Bermuda 56 109 41 37 37 109 82 2 23 Brazil 10 18 13 19 14 18 22 25 24 British West Indies 194 514 201 189 198 514 693 700 25 Mexico 102 121 101 131 122 121 101 101 26 Venezuela 49 72 55 68 71 72 70 72 27 Asia 791 795 790 772 757 795 821 775 28 Japan 714 723 714 706 700 723 737 680 29 Middle East oil-exporting countries3 32 31 23 25 19 31 26 31 30 Africa 5 4 5 6 5 4 11 10 31 Oil-exporting countries4 2 1 1 2 1 1 1 1 32 All other5 5 4 5 5 5 4 10 15 Commercial liabilities 33 Europe 3.033 3,625 3,003 3,306 3.395 3.625 3,682 4,006 34 Belgium-Luxembourg 75 137 70 81 103 137 117 132 35 France 321 467 350 353 394 467 503 485 36 Germany 529 534 395 471 539 534 533 714 37 Netherlands 246 227 224 230 206 227 288 245 38 Switzerland 302 310 329 439 348 310 382 462 39 United Kingdom 824 1,078 870 997 1,015 1.078 994 1,120 40 Canada 667 852 614 645 709 852 720 591 41 Latin America 997 1,323 1,168 1,335 1.401 1,323 1,253 1,307 42 Bahamas 25 69 16 65 89 69 4 26 43 Bermuda 97 32 42 82 48 32 47 107 44 Brazil 74 203 61 165 186 203 228 151 45 British West Indies 53 21 89 121 21 21 20 37 46 Mexico 106 257 236 216 270 257 235 311 47 Venezuela 303 301 356 323 359 301 211 210 48 2,912 2,859 2.622 3,007 2,985 2,859 2,912 3,051 49 Japan 429 481 401 489 506 481 578 411 50 Middle East oil-exporting countries3 1,523 1,021 1,122 1,225 1,070 1,021 901 1,017 51 Africa 743 728 779 891 775 728 742 875 52 Oil-exporting countries4 312 384 343 410 370 384 382 498 53 All other5 203 237 237 243 287 237 263 367 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 A65 3.25 CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1979 1980 TTyyppee,, aanndd aarreeaa oorr ccoouunnttrryy 11997788 11997799 Mar. June Sept. Dec. Mar.' Jun eP 1 Total 27,645 30,141 30,114 29,516 30,069 30,141 31,953 31,808 2 Payable in dollars 24,700 27,087 27,348 26,665 27,458 27,087 28,956 28,778 3 Payable in foreign currencies2 2,945 3,055 2,766 2,852 2,611 3,055 2,997 3,030 By type 4 Financial claims 16,307 17,456 19,390 18,526 18,295 17,456 19,237 18,467 5 Deposits 10,846 11,810 13,932 12,904 12,888 11,810 13,563 12,626 6 Payable in dollars 9,785 10,927 13,013 11,967 11,988 10,927 12,601 11,766 7 Payable in foreign currencies 1,061 883 920 938 901 883 963 860 8 Other financial claims 5,461 5,646 5,458 5,622 5,407 5,646 5,673 5,841 9 Payable in dollars 3,908 3,872 3,949 4,071 4,049 3,872 4,046 4,097 10 Payable in foreign currencies 1,553 1,774 1,509 1,551 1,358 1,774 1,627 1,744 11 Commercial claims 11,337 12,685 10,724 10,991 11,773 12,685 12,716 13,341 12 Trade receivables 10,779 11,997 10,054 10,362 11,061 11,997 12,071 12,638 13 Advance payments and 'other claims 559 688 670 628 712 688 645 703 14 Payable in dollars 11,007 12,287 10,387 10,627 11,421 12,287 12,309 12,915 15 Payable in foreign currencies 331 398 337 363 352 398 407 426 By area or country Financial claims 16 Europe 5,073 6,066 5,203 5,498 6,428 6,066 5,826 5,812 17 Belgium-Luxembourg 48 32 63 54 33 32 19 23 18 France 178 177 171 183 191 177 290 307 19 Germany 510 401 266 361 393 401 298 185 20 Netherlands 103 53 85 62 51 53 39 37 21 Switzerland 98 73 96 81 85 73 89 96 22 United Kingdom 3,878 5,009 4,284 4,510 5,388 5,009 4,778 4,835 23 Canada 4,482 4,777 5,164 5,101 4,709 4,777 4,882 4,778 24 Latin America and Caribbean 5,595 5,624 7,939 6,840 5,994 5,624 7,512 6,800 25 Bahamas 2,902 2,294 4,148 3,216 2,831 2,294 3,448 2,962 26 Bermuda 80 30 63 57 31 30 34 25 27 Brazil 151 163 156 141 133 163 128 120 28 British West Indies 1,280 1,851 2,443 2,281 1,717 1,851 2,591 2,393 29 Mexico 163 158 160 159 156 158 169 178 30 Venezuela 150 133 142 151 139 133 132 132 31 922 693 829 800 818 693 708 756 32 Japan 307 190 207 217 222 190 226 253 33 Middle East oil-exporting countries3 18 16 16 17 21 16 18 16 34 Africa 181 253 204 227 277 253 265 256 35 Oil-exporting countries4 10 49 26 23 41 49 40 35 36 All other5 55 44 52 61 69 44 43 65 Commercial claims 37 Europe 3,985 4,891 3,811 3,833 4,127 4,891 4,751 4,808 38 Belgium-Luxembourg 144 203 173 170 179 203 208 255 39 France 609 727 490 470 518 727 703 662 40 Germany 399 580 504 421 448 580 515 504 41 Netherlands 267 298 275 307 262 298 347 297 42 Switzerland 198 269 230 232 224 269 349 429 43 United Kingdom 827 905 676 731 818 905 924 904 44 Canada 1,094 840 1,109 1,104 1,162 840 862 895 45 Latin America and Caribbean 2,547 2,859 2,395 2,406 2,598 2,859 2,990 3,278 46 Bahamas 109 21 117 98 16 21 19 19 47 Bermuda 215 197 241 118 154 197 135 133 48 Brazil 629 647 495 503 568 647 656 697 49 British West Indies 9 16 10 25 13 16 11 9 50 Mexico 506 704 489 584 650 704 833 918 51 Venezuela 292 342 274 296 346 342 349 394 52 3,085 3,299 2,765 2,967 3,116 3,299 3,370 3,544 53 Japan 979 1,127 896 1,005 1,128 1,127 1,209 1,129 54 Middle East oil-exporting countries3 717 700 682 685 701 700 718 830 55 Africa 447 556 443 487 549 556 518 567 56 Oil-exporting countries4 136 133 131 139 140 133 114 116 57 All other5 179 240 200 194 220 240 225 249 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

A66 International Statistics • November 1980 3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Percent per annum Rate on Oct. 31, 1980 Rate on Oct. 31, 1980 Rate on Oct. 31, 1980 Country Country Country Per- Month Per- Month Per- Month cent effective cent effective cent effective Austria . 6.75 Mar. 1980 Germany, Fed. Rep. of 7.5 May 1980 Switzerland 3.0 Feb. 1980 Belgium 12.0 July 1980 Italy 16.5 Sept. 1980 United Kingdom 16.0 July 1979 Brazil .. 40.0 June 1980 Japan 8.25 Aug. 1980 Venezuela 12.0 Mar. 1980 Canada . 12.16 Oct. 1980 Netherlands 8.0 Oct. 1980 Denmark 11.00 Oct. 1980 Norway 9.0 Nov. 1979 France .. 9.5 Aug. 1977 Sweden 10.0 Jan.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 1980 CCoouunnttrryy,, oorr ttyyppee 11997777 11997788 11997799 Apr. May June July Aug. Sept. Oct. 1 Eurodollars 6.03 8.74 11.96 17.81 11.20 9.41 9.33 10.82 12.07 13.55 2 United Kingdom 8.07 9.18 13.60 17.70 16.97 16.68 15.82 16.45 15.89 15.87 3 Canada 7.47 8.52 11.91 16.31 13.23 11.73 10.91 10.47 10.73 11.71 4 Germany 4.30 31.61 6.64 10.12 10.18 10.00 9.59 8.93 8.90 8.99 5 Switzerland 2.56 0.74 2.04 6.87 5.85 5.64 5.29 5.52 5.57 5.40 6 Netherlands 4.73 6.53 9.33 10.76 11.18 10.72 10.06 9.97 10.31 9.63 7 France 9.20 8.10 9.44 12.84 12.62 12.37 11.87 11.20 11.81 11.69 8 Italy 14.26 11.40 11.85 16.91 17.20 17.25 17.49 17.30 17.50 18.16 9 Belgium 6.95 7.14 10.48 17.10 16.31 14.69 13.30 12.52 12.35 12.24 10 Japan 6.22 4.75 6.10 13.51 13.63 13.51 12.89 12.04 11.46 10.98 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 1980 CCoouunnttrryy//ccuurrrreennccyy 11997777 11997788 11997799 Apr. May June July Aug. Sept. Oct. 1 Australia/dollar 110.82 114.41 111.77 109.10 113.02 115.29 115.85 115.77 117.04 117.43 2 Austria/schilling 6.0494 6.8958 7.4799 7.4513 7.8112 7.9421 8.0578 7.8840 7.8916 7.6714 3 Belgium/franc 2.7911 3.1809 3.4098 3.3156 3.4759 3.5335 3.5766 3.4883 3.4844 3.3875 4 Canada/dollar 94.112 87.729 85.386 84.311 85.178 86.836 86.783 86.263 85.861 85.538 5 Denmark/krone 16.658 18.156 19.010 17.104 17.859 18.215 18.487 18.070 18.068 17.639 6 Finland/markka 24.913 24.337 27.732 26.158 27.084 27.448 27.699 27.353 27.428 27.122 7 France/franc 20.344 22.218 23.504 22.985 23.920 24.310 24.657 24.106 24.056 23.489 8 Germany/deutsche mark 43.079 49.867 54.561 53.310 55.828 56.584 57.245 55.867 55.883 54.280 9 India/rupee 11.406 12.207 12.265 12.395 12.727 12.751 12.875 12.849 12.903 12.932 10 Ireland/pound 174.49 191.84 204.65 198.98 207.41 211.16 214.74 210.62 210.34 203.88 11 Italy/lira .11328 .11782 .12035 .11417 .11860 .11973 .12026 .11801 .11742 .11441 12 Japan/yen .37342 .47981 .45834 .39980 .43766 .45894 .45232 .44666 .46644 .47777 13 Malaysia/ringgit 40.620 43.210 45.720 43.817 45.691 46.625 46.658 46.484 47.127 46.902 14 Mexico/peso 4.4239 4.3896 4.3826 4.3779 4.3763 4.3684 4.3511 4.3389 4.3443 4.3324 15 Netherlands/guilder 40.752 46.284 49.843 48.570 50.673 51.578 52.337 51.305 51.398 50.052 16 New Zealand/dollar 96.893 103.64 102.23 94.704 97.641 98.729 98.643 97.738 98.309 98.069 17 Norway/krone 18.789 19.079 19.747 19.739 20.377 20.608 20.762 20.555 20.676 20.421 18 Portugal/escudo 2.6234 2.2782 2.0437 1.9798 2.0298 2.0422 2.0466 2.0163 2.0096 1.9756 19 South Africa/rand 114.99 115.01 118.72 123.88 126.43 129.00 130.79 131.55 132.73 133.13 20 Spain/peseta 1.3287 1.3073 1.4896 1.3918 1.4104 1.4280 1.4122 1.3810 1.3639 1.3423 21 Sri Lanka/rupee 11.964 6.3834 6.4226 6.1500 6.1900 6.2186 6.3288 6.2980 6.3196 5.9707 22 Sweden/krona 22.383 22.139 23.323 22.872 23.731 23.995 24.238 23.953 24.072 23.845 23 Switzerland/franc 41.714 56.283 60.121 56.857 60.131 61.207 62.203 60.527 61.012 60.185 24 United Kingdom/pound 174.49 191.84 212.24 220.94 230.20 233.59 237.32 237.04 240.12 241.64 MEMO: 25 United States/dollar1 103.31 92.39 88.09 91.09 86.96 85.29 84.65 86.09 85.50 86.59 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

A67 Guide to Tabular Presentation, Statistical Releases, and Special Tables 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 millions) 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 periodic releases August 1980 A80 SPECIAL TABLES Published Irregularly, with Latest Bulletin Reference Commercial bank assets and liabilities, call dates, December 31, 1978, to March 31, 1980 October 1980 A71 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 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 FRANK O'BRIEN, JR., Special Assistant to the Board STEPHEN H. AXILROD, Staff Director JOSEPH S. SIMS, Special Assistant to the Board EDWARD C. ETTIN, Deputy Staff Director DONALD J. WINN, Special Assistant to the Board MURRAY ALTMANN, Assistant to the Board PETER M. KEIR, Assistant to the Board STANLEY J. SIGEL, Assistant to the Board LEGAL DIVISION NORMAND R. V. BERNARD, Special Assistant to the Board NEAL L. PETERSEN, General Counsel ROBERT E. MANNION, Deputy General Counsel DIVISION OF RESEARCH AND STATISTICS CHARLES R. MCNEILL, Assistant to the General Counsel J. VIRGIL MATTINGLY, Assistant General Counsel JAMES L. KICHLINE, Director GILBERT T. SCHWARTZ, Assistant General Counsel JOSEPH S. ZEISEL, Deputy Director MICHAEL J. PRELL, Associate Director ROBERT A. EISENBEIS, Senior Deputy Associate Director OFFICE OF THE SECRETARY tJoHN J. MINGO, Senior Deputy Associate Director ELEANOR J. STOCKWELL, Senior Deputy Associate Director THEODORE E. ALLISON, Secretary JARED J. ENZLER, Deputy Associate Director BARBARA R. LOWREY, Assistant Secretary J. CORTLAND G. PERET, Deputy Associate Director *JEFFERSON A. WALKER, Assistant Secretary HELMUT F. WENDEL, Deputy Associate Director MARTHA BETHEA, Assistant Director ROBERT M. FISHER, Assistant Director DIVISION OF CONSUMER FREDERICK M. STRUBLE, Assistant Director AND COMMUNITY AFFAIRS STEPHEN P. TAYLOR, Assistant Director LEVON H. GARABEDIAN , Assistant Director (Administration) JANET O. HART, Director GRIFFITH L. GARWOOD, Deputy Director JERAULD C. KLUCKMAN, Associate Director DIVISION OF INTERNATIONAL FINANCE GLENN E. LONEY, Assistant Director DOLORES S. SMITH, Assistant Director EDWIN M. TRUMAN, Director ROBERT F. GEMMILL, Associate Director GEORGE B. HENRY, Associate Director DIVISION OF BANKING CHARLES J. SIEGMAN, Associate Director SUPERVISION AND REGULATION SAMUEL PIZER, Staff Adviser JEFFREY R. SHAFER, Deputy Associate Director JOHN E. RYAN, Director DALE W. HENDERSON, Assistant Director FREDERICK R. DAHL, Associate Director LARRY J. PROMISEL, Assistant Director WILLIAM TAYLOR, Associate Director RALPH W. SMITH, JR., Assistant 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 LAURA M. HOMER, Securities Credit Officer Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A69 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 ACTIVITIES JOHN M. DENKLER, Staff Director WILLIAM H. WALLACE, Staff Director EDWARD T. MULRENIN, 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 WALTER 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 DAVID L. ROBINSON, Assistant Director DIVISION OF PERSONNEL RAYMOND L. TEED, Assistant Director 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 ROBERT E. FRAZIER, Assistant Director WALTER W. KREIMANN, Associate Director *On loan from the Federal Reserve Bank of Richmond. tOn leave of absence. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

70 Federal Reserve Bulletin • November 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 ROBERT M. SURDAM, 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

A71 Federal Reserve Banks, Branches, and Offices FEDERAL RESERVE BANK, Chairman President Vice President branch, or facility Zip Deputy Chairman First Vice President in charge of branch BOSTON* .02106 Robert M. Solow Frank E. Morris Robert P. Henderson James A. Mcintosh NEW YORK* .10045 Robert H. Knight, Esq. 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 30301 William A. Fickling, Jr. William F. Ford John H. Weitnauer, Jr. Robert P. Forrestal Birmingham 35202 Harold B. Blach, Jr. Hiram J. Honea Jacksonville ,,,32231 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 E. Gerald Corrigan 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. Boy kin 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 George H. Weyerhaeuser Gerald R.Kelly *Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; Cranford, New Jersey 07016; Jericho, New York 11753; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West Virginia 25311; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A72 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- SURVEY OF CHANGES IN FAMILY FINANCES. 1968. 321 pp. TIONS. 1974. 125 pp. $1.00 each; 10 or more to one address, $.85 each. ANNUAL REPORT. REPORT OF THE JOINT TREASURY-FEDERAL RESERVE STUDY FEDERAL RESERVE BULLETIN. Monthly. $20.00 per year or OF THE U.S. GOVERNMENT SECURITIES MARKET. 1969. $2.00 each in the United States, its possessions, Canada, 48 pp. $.25 each; 10 or more to one address, $.20 each. and Mexico; 10 or more of same issue to one address, JOINT TREASURY-FEDERAL RESERVE STUDY OF THE GOV- $18.00 per year or $1.75 each. Elsewhere, $24.00 per ERNMENT SECURITIES MARKET: STAFF STUDIES—PART year or $2.50 each. 1. 1970. 86 pp. $.50 each; 10 or more to one address, $.40 BANKING AND MONETARY STATISTICS, 1914-1941. (Reprint each. Part 2, 1971. 153 pp. and Part 3. 1973. 131 pp. Each of Part I only) 1976. 682 pp. $5.00. volume $1.00; 10 or more to one address, $.85 each. BANKING AND MONETARY STATISTICS, 1941-1970. 1976. OPEN MARKET POLICIES AND OPERATING PROCEDURES— 1,168 pp. $15.00. 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Paper ed. $4.00 each; 10 or more to one adincludes one issue of Historical Chart Book. $7.00 per dress, $3.60 each. year or $2.00 each in the United States, its possessions, FEDERAL RESERVE STAFF STUDY: WAYS TO MODERATE Canada, and Mexico. Elsewhere, $10.00 per year or FLUCTUATIONS IN HOUSING CONSTRUCTION. 1972. 487 $3.00 each. pp. $4.00 each; 10 or more to one address, $3.60 each. HISTORICAL CHART BOOK. Issued annually in Sept. Subscrip- LENDING FUNCTIONS OF THE FEDERAL RESERVE BANKS. tion to Federal Reserve Chart Book includes one issue. 1973. 271 pp. $3.50 each; 10 or more to one address, $1.25 each in the United States, its possessions, Canada, $3.00 each. and Mexico; 10 or more to one address, $1.00 each. Else- IMPROVING THE MONETARY AGGREGATES: REPORT OF THE where, $1.50 each. ADVISORY COMMITTEE ON MONETARY STATISTICS. CAPITAL MARKET DEVELOPMENTS. Weekly. $15.00 per year 1976. 43 pp. $1.00 each; 10 or more to one address, $.85 or $.40 each in the United States, its possessions, Cana- each. da, and Mexico; 10 or more of same issue to one address, ANNUAL PERCENTAGE RATE TABLES (Truth in Lending— $13.50 per year or $.35 each. Elsewhere, $20.00 per year Regulation Z) Vol. I (Regular Transactions). 1969. 100 or $.50 each. pp. Vol. II (Irregular Transactions). 1969. 116 pp. Each SELECTED INTEREST AND EXCHANGE RATES—WEEKLY SE- volume $1.00; 10 or more of same volume to one ad- RIES OF CHARTS. Weekly. $15.00 per year or $.40 each in dress, $.85 each. the United States, its possessions, Canada, and Mexico; 10 or more of same issue to one address, $13.50 per year FEDERAL RESERVE MEASURES OF CAPACITY AND CAPACITY UTILIZATION. 1978. 40 pp. $1.75 each; 10 or more to one or $.35 each. Elsewhere, $20.00 per year or $.50 each. address, $1.50. each. THE FEDERAL RESERVE ACT, as amended through December 1976, with an appendix containing provisions of certain THE BANK HOLDING COMPANY MOVEMENT TO 1978: A COMPENDIUM. 1978. 289 pp. $2.50 each; 10 or more to other statutes affecting the Federal Reserve System. 307 one address, $2.25 each. pp. $2.50. REGULATIONS OF THE BOARD OF GOVERNORS OF THE FED- IMPROVING THE MONETARY AGGREGATES: STAFF PAPERS. 1978. 170 pp. $4.00 each; 10 or more to one address, ERAL RESERVE SYSTEM $3.75 each. PUBLISHED INTERPRETATIONS OF THE BOARD OF GOVER- 1977 CONSUMER CREDIT SURVEY. 1978. 119 pp. $2.00 each. NORS, as of Dec. 31, 1979. $7.50. 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. BANK CREDIT-CARD AND CHECK-CREDIT PLANS. 1968. 102 INTRODUCTION TO FLOW OF FUNDS. 1980. 68 pp. $1.50 pp. $1.00 each; 10 or more to one address, $.85 each. each; 10 or more to one address, $1.25 each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A73 CONSUMER EDUCATION PAMPHLETS MEASUREMENT OF CAPACITY UTILIZATION: PROBLEMS AND Short pamphlets suitable for classroom use. Multiple TASKS, by Frank de Leeuw, Lawrence R. Forest, Jr., copies available without charge. Richard D. Raddock, and Zoltan E. Kenessey. July 1979. 264 pp. Alice in Debitland THE GNMA-GUARANTEED PASSTHROUGH SECURITY: MAR- The Board of Governors of the Federal Reserve System KET DEVELOPMENT AND IMPLICATIONS FOR THE GROWTH Consumer Handbook To Credit Protection Laws AND STABILITY OF HOME MORTGAGE LENDING, by The Equal Credit Opportunity Act and . . . Age David F. Seiders. Dec. 1979. 65 pp. The Equal Credit Opportunity Act and . . . Credit Rights in FOREIGN OWNERSHIP AND THE PERFORMANCE OF U.S. Housing BANKS, by James V. Houpt. July 1980. 27 pp. The Equal Credit Opportunity Act and . . . Doctors, Lawyers, Small Retailers, and Others Who May Provide Printed in Full in the Bulletin Incidental Credit The Equal Credit Opportunity Act and . . . Women AN ASSESSMENT OF BANK HOLDING COMPANIES, by Fair Credit Billing Robert J. Lawrence and Samuel H. Talley. January 1976. The Federal Open Market Committee Federal Reserve Bank Board of Directors Federal Reserve Banks Federal Reserve Glossary How to File A Consumer Credit Complaint If You Borrow To Buy Stock If You Use A Credit Card REPRINTS Truth in Leasing U.S. Currency Most of the articles reprinted do not exceed 12 pages. What Truth in Lending Means to You Measures of Security Credit. 12/70. Revision of Bank Credit Series. 12/71. Assets and Liabilities of Foreign Branches of U.S. Banks. STAFF STUDIES 2/72. Studies and papers on economic and financial subjects that Bank Debits, Deposits, and Deposit Turnover—Revised are of general interest. Series. 7/72. Rates on Consumer Instalment Loans. 9/73. Summaries Only Printed in the Bulletin New Series for Large Manufacturing Corporation. 10/73. Requests to obtain single copies of the full text or to be The Structure of Margin Credit. 4/75. added to the mailing list for the series may be sent to Pub- Industrial Electric Power Use. 1/76. lications Services. Revised Series for Member Bank Deposits and Aggregate Reserves. 4/76. Industrial Production— 1976 Revision. 6/76. THE RELATIONSHIP BETWEEN RESERVE RATIOS AND THE Federal Reserve Operations in Payment Mechanisms: A MONETARY AGGREGATES UNDER RESERVES AND FED- Summary. 6/76. ERAL FUNDS RATE OPERATING TARGETS, by Kenneth J. The Commercial Paper Market. 6/77. Kopecky. Dec. 1978. 58 pp. The Federal Budget in the 1970's. 9/78. TIE-INS BETWEEN THE GRANTING OF CREDIT AND SALES OF Redefining the Monetary Aggregates. 1/79. INSURANCE BY BANK HOLDING COMPANIES AND OTHER Implementation of the International Banking Act. 10/79. LENDERS, by Robert A. Eisenbeis and Paul R. Schweitzer. U.S. International Transactions in 1979: Another Round of Feb. 1979. 75 pp. Oil Price Increases. 4/80. INNOVATIONS IN BANK LOAN CONTRACTING: RECENT EVI- Perspectives on Personal Saving. 8/80. DENCE by Paul W. Boltz and Tim S. Campbell. May 1979. The Impact of Rising Oil Prices on the Major Foreign In- 40 pp. dustrial Countries. 10/80. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A74 Index to Statistical Tables References are to pages A-3 through A-66 although the prefix "A" is omitted in this index ACCEPTANCES, bankers, 10, 23, 25 Demand deposits—Continued Agricultural loans, commercial banks, 18,19,20,24 Subject to reserve requirements, 14 Assets and liabilities {See also Foreigners) Turnover, 12 Banks, by classes, 17, 18-21, 27 Deposits {See also specific types) Domestic finance companies, 37 Banks, by classes, 3, 17, 18-21, 27 Federal Reserve Banks, 11 Federal Reserve Banks, 4,11 Nonfinancial corporations, current, 36 Turnover, 12 Automobiles Discount rates at Reserve Banks {See Interest rates) Consumer installment credit, 40,41 Discounts and advances by Reserve Banks {See Production, 46,47 Loans) Dividends, corporate, 35 BANKERS balances, 17, 18-20 {See also Foreigners) Banks for Cooperatives, 33 EMPLOYMENT, 44,45 Bonds {See also U.S. government securities) Eurodollars, 25 New issues, 34 Yields, 3 FARM mortgage loans, 39 Branch banks, 15, 21, 54 Farmers Home Administration, 39 Business activity, nonfinancial, 44 Federal agency obligations, 4, 10, 11, 12, 32 Business expenditures on new plant and equipment, 36 Federal and federally sponsored credit agencies, 33 Business loans {See Commercial and industrial loans) Federal finance Debt subject to statutory limitation and types and CAPACITY utilization, 44 ownership of gross debt, 30 Capital accounts Receipts and outlays, 28, 29 Banks, by classes, 17 Treasury operating balance, 28 Federal Reserve Banks, 11 Federal Financing Bank, 28, 33 Central banks, 66 Federal funds, 3,6,18,19, 20, 25, 28 Certificates of deposit, 21,25 Federal Home Loan Banks, 33 Commercial and industrial loans Federal Home Loan Mortgage Corporation, 33, 38,39 Commercial banks, 15, 24 Federal Housing Administration, 33, 38, 39 Weekly reporting banks, 18-21,22 Federal Intermediate Credit Banks, 33 Commercial banks Federal Land Banks, 33, 39 Assets and liabilities, 3,15, 17, 18-21 Federal National Mortgage Association, 33, 38, 39 Business loans, 24 Federal Reserve Banks Commercial and industrial loans, 22, 24 Condition statement, 11 Consumer loans held, by type, 40,41 Discount rates {See Interest rates) Loans sold outright, 21 U.S. government securities held, 4,11,12, 30,31 Nondeposit funds, 16 Federal Reserve credit, 4, 5, 11, 12 Number, 17 Federal Reserve notes, 11 Real estate mortgages held, by holder and property, 39 Federally sponsored credit agencies, 33 Commercial paper, 3, 23, 25, 37 Finance companies Condition statements {See Assets and liabilities) Assets and liabilities, 37 Construction, 44,48 Business credit, 37 Consumer installment credit, 40,41 Loans, 18, 19, 20,40,41 Consumer prices, 44,49 Paper, 23, 25 Consumption expenditures, 50, 51 Financial institutions, loans to, 18,19,20 Corporations Float, 4 Profits and their distribution, 35 Flow of funds, 42,43 Security issues, 34, 63 Foreign Cost of living {See Consumer prices) Currency operations, 11 Credit unions, 27,40,41 Deposits in U.S. banks, 4,11, 18, 19, 20 Currency and coin, 5,17 Exchange rates, 66 Currency in circulation, 4,13 Trade, 53 Customer credit, stock market, 26 Foreigners Claims on, 54, 56, 59, 60,61,65 Liabilities to, 21, 54-58,62-64 DEBITS to deposit accounts, 12 Debt {See specific types of debt or securities) Demand deposits GOLD Adjusted, commercial banks, 12, 14 Certificates, 11 Banks, by classes, 17,18-21 Stock, 4, 53 Ownership by individuals, partnerships, and Government National Mortgage Association, 33,38,39 corporations, 23 Gross national product, 50, 51 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A75 HOUSING, new and existing units, 48 REAL estate loans Banks, by classes, 18-20, 27, 39 INCOME, personal and national, 44, 50, 51 Life insurance companies, 27 Industrial production, 44,46 Mortgage terms, yields, and activity, 3, 38 Installment loans, 40, 41 Type of holder and property mortgaged, 39 Insurance companies, 27, 30, 31, 39 Repurchase agreements and federal funds, 6, 18, 19, 20 Interbank loans and deposits, 17 Reserve requirements, member banks, 8 Interest rates Reserves Bonds, 3 Commercial banks, 17 Business loans of banks, 24 Federal Reserve Banks, 11 Federal Reserve Banks, 3, 7 Member banks, 3,4,5, 14, 17 Foreign countries, 66 U.S. reserve assets, 53 Money and capital markets, 3, 25 Residential mortgage loans, 38 Mortgages, 3, 38 Retail credit and retail sales, 40, 41, 44 Prime rate, commercial banks, 24 Time and savings deposits, 9 SAVING International capital transactions of the United States, 54-65 Flow of funds, 42,43 International organizations, 54-59, 62-65 National income accounts, 51 Inventories, 50 Savings and loan assns., 3, 9, 27, 31, 39,42 Investment companies, issues and assets, 35 Savings deposits (See Time deposits) Investments (See also specific types) Savings institutions, selected assets, 27 Banks, by classes, 17, 27 Securities (See also U.S. government securities) Commercial banks, 3, 15, 17, 18-20 Federal and federally sponsored agencies, 33 Federal Reserve Banks, 11, 12 Foreign transactions, 63 Life insurance companies, 27 New issues, 34 Savings and loan associations, 27 Prices, 26 Special drawing rights, 4, 11, 52, 53 LABOR force, 45 State and local governments Life insurance companies (See Insurance companies) Deposits, 18, 19, 20 Loans (See also specific types) Holdings of U.S. government securities, 30, 31 Banks, by classes, 17,18-21, 27 New security issues, 34 Commercial banks, 3, 15, 17, 18-21, 22, 24 Ownership of securities of, 18, 19, 20, 27 Federal Reserve Banks, 3,4, 5, 7, 11, 12 Yields of securities, 3 Insurance companies, 27, 39 Stock market, 26 Insured or guaranteed by United States, 38,39 Stocks (See also Securities) Savings and loan associations, 27 New issues, 34 Prices, 26 MANUFACTURING Capacity utilization, 44 TAX receipts, federal, 29 Production, 44,47 Time deposits, 3, 9, 12, 14, 17, 18-21 Margin requirements, 26 Trade, foreign, 53 Member banks Treasury currency, Treasury cash, 4 Assets and liabilities, by classes, 17 Treasury deposits, 4, 11, 28 Borrowings at Federal Reserve Banks, 5,11 Treasury operating balance, 28 Federal funds and repurchase agreements, 6 Number, 17 UNEMPLOYMENT, 45 Reserve requirements, 8 U.S. balance of payments, 52 Reserves and related items, 3, 4, 5, 14 U.S. government balances Mining production, 47 Commercial bank holdings, 18, 19,20 Mobile home shipments, 48 Member bank holdings, 14 Monetary aggregates, 3, 14 Treasury deposits at Reserve Banks, 4, 11, 28 Money and capital market rates (See Interest rates) U.S. government securities Money stock measures and components, 3, 13 Bank holdings, 17, 18-20, 27, 30, 31 Mortgages (See Real estate loans) Dealer transactions, positions, and financing, 32 Mutual funds (See Investment companies) Federal Reserve Bank holdings, 4, 11, 12, 30, 31 Mutual savings banks, 3, 9, 18-20, 27, 30, 31, 39 Foreign and international holdings and transactions, 11, 30, 62 NATIONAL defense outlays, 29 Open market transactions, 10 National income, 50 Outstanding, by type and ownership, 30, 31 Rates, 3, 25 OPEN market transactions, 10 Utilities, production, 47 PERSONAL income, 51 VETERANS Administration, 38, 39 Prices Consumer and producer, 44,49 WEEKLY reporting banks, 18-22 Stock market, 26 Wholesale (producer) prices, 44, 49 Prime rate, commercial banks, 24 Production, 44,46 YIELDS (See Interest rates) Profits, corporate, 35 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A76 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories Minneapolis^ Detroit Chicago Kansas City Louisville t. Louis 5karlottej Nashvillt Jttle Rock Birminghan* ® 2 A lant Dallas® U Paso Houston1 tan Antonio January 1978 ALASKA HAWAII Ml! LEGEND Boundaries of Federal Reserve Districts ® Federal Reserve Bank Cities Boundaries of Federal Reserve Branch • Federal Reserve Branch Cities Territories • Federal Reserve Bank Facility © Board of Governors of the Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis