Federal Reserve Bulletin, 1985-01

VOLUME 71 • NUMBER 1 • JANUARY 1985 FEDERAL RESERVE BULLETIN BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, D.C. PUBLICATIONS COMMITTEE Joseph R. Coyne, Chairman • Stephen H. Axilrod • Michael Bradfield • S. David Frost • Griffith L. Garwood • James L. Kichline • 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. It is assisted by the Economic Editing Unit headed by Mendelle T. Berenson, the Graphic Communications Section under the direction of Peter G. Thomas, and Publications Services supervised by Helen L. Hulen. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Table of Contents L CHANGES IN LOAN PRICING AND Policy statement regarding surpluses or BUSINESS LENDING AT COMMERCIAL shortfalls that arise from the fees for ser- BANKS vices to depository institutions. A number of important changes have affect- Approval of private sector adjustment faced the competitive environment of U.S. tor. commercial banks as suppliers of business Technical modification of extended credit credit in the past half dozen years. program. 14 U.S. MONETARY POLICYIN RECENT Amendment to Regulation D. YEARS: AN OVERVIEW Amendment to Regulation Z. The basic thrust of U.S. monetary policy in Availability of bank holding company list. recent years has been to curb inflation and to set the stage for sustainable economic Request for comments on application to growth. expand scope of activities of BT Futures Corp.; proposal for two-tier fee schedule 25 STAFF STUDIES for the collection of certain checks; proposal to amend Regulation AA; requests for "Mergers and Acquisitions by Commercial comments on proposed changes to staff Banks, 1960-83" presents data based on commentaries on Regulations E and Z. the documentation of 4,805 bank mergers and acquisitions by state, year, type of Admission of one state bank to membership merger, approving federal regulator, type of in the Federal Reserve System. market, type of acquiring organization, and size of the acquired and acquiring firms. 33 RECORD OF POLICY ACTIONS OF THE FEDERAL OPEN MARKET COMMITTEE 26 INDUSTRIAL PRODUCTION At the conclusion of the meeting on Octo- Output for October 1984 was unchanged ber 2, 1984, a majority of the members from that for September. indicated that they favored or could accept a directive that called for maintaining the 28 ANNOUNCEMENTS lesser degree of restraint on reserve positions that had been attained over recent Change in the discount rate. weeks. The members expected that such an Letter from Chairman Volcker regarding approach to policy implementation would conditional approval of applications to ac- be consistent with growth of Ml, M2, and quire nonbank banks. M3 at annual rates of about 6, IVi, and 9 percent respectively for the period from Changes in the fees for wire transfers of September to December. Somewhat lesser funds and automated clearinghouse serrestraint would be acceptable if growth of vices. the monetary aggregates should fall signifi- Approval of 1985 schedules of fees for cantly short of expectations, with any adcheck collection services of the Federal justment in operations to be evaluated in Reserve Banks. the context of the strength of the business Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

expansion and inflationary pressures, con- AI FINANCIAL AND BUSINESS STATISTICS ditions in domestic and international finan- A3 Domestic Financial Statistics cial markets, and the rate of credit growth. A45 Domestic Nonfinancial Statistics Conversely, greater restraint might be ac- A53 International Statistics ceptable in the event of substantially more rapid growth in the monetary aggregates A69 GUIDE TO TABULAR PRESENTATION, than was currently expected, provided such STATISTICAL RELEASES, AND SPECIAL growth was associated with evidence that TABLES economic activity and inflationary pressures were strengthening significantly. It A70 BOARD OF GOVERNORS AND STAFF was agreed that the intermeeting range for the federal funds rate, which provides a A72 FEDERAL OPEN MARKET COMMITTEE mechanism for initiating consultation of the AND STAFF; ADVISORY COUNCILS Committee, should be left unchanged at 8 to 12 percent. A74 FEDERAL RESERVE BOARD PUBLICATIONS 39 LEGAL DEVELOPMENTS Amendments to Regulations D and Z; vari- A77 INDEX TO STATISTICAL TABLES ous bank holding company, bank service corporation, and bank merger orders; and A79 FEDERAL RESERVE BANKS, BRANCHES, pending cases. AND OFFICES A80 MAP OF FEDERAL RESERVE SYSTEM Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Changes in Loan Pricing and Business Lending at Commercial Banks Thomas F. Brady of the Board's Division of CURRENT PROCEDURES Research and Statistics prepared this article. FOR PRICING LARGER LOANS Sukkoo Kim provided research assistance. The concept of the prime rate as a base cost of The last half-dozen or so years have been commercial bank credit dates back to the late marked by important changes in the environment 1920s, and a uniform national prime rate began to in which U.S. commercial banks compete as be publicized by large banks in 1933. A large suppliers of business credit. Since 1977, for majority of business loans made today continue example, the outstanding volume of commercial to feature prices that are based on an announced paper issued by nonfinancial corporations has base rate, traditionally the prime rate, or, as it is increased several-fold, and the number of firms now often called, the base, or reference, rate. tapping this market has expanded substantially. However, most large loans—those accounting Certainly as important have been inroads made for the bulk of the dollar volume of all business by foreign banks, which have used aggressive loans being made—have rates linked to money pricing policies to supply large volumes of credit market rates. Such large loans are made under to domestic firms. Life insurance and finance two types of credit facilities, referred to by banks companies have become major competitors in as "lines" and "commitments." Lines are relatraditional bank lending sectors. The conditions tively informal arrangements under which banks under which commercial banks fund their lend- agree that on demand they will quote a price on a ing also have changed, as deposits still subject to fixed-rate loan for a particular amount and matuinterest rate ceilings, mostly retail deposits, were rity (usually under a year) selected by the boralmost completely deregulated between mid- rower, within specified limits. Banks typically 1978 and late 1983. set the price of such loans by marking up a To one degree or another, each of these devel- reference market rate for the same maturity as opments has fostered the practice among large the loan—for example, the rate on 30-day certifibanks of pricing a considerable share of their cates of deposit for a 30-day loan (though funding large business loans at rates linked directly to decisions are quite separate from lending decimoney market funding costs. The role of the sions). Banks retain full flexibility with respect to prime rate, the traditional benchmark of the cost pricing under such arrangements, and the borof short-term business credit, has corresponding- rower is offered an "all-in rate" reflecting the ly diminished. This article examines current pro- base rate and the markup on a take-it-or-leave-it cedures for pricing commercial and industrial basis. By widening or narrowing their markups, (C&I) loans and reviews developments in this banks can affect the quantity of these loans area since 1977 using information from the Sur- outstanding. vey of Terms of Bank Lending (STBL), the Unlike lines, loan commitments require fees, Senior Loan Officer Opinion Survey of Bank which are paid on the unused credit available Lending Practices (LPS), and other sources, under the arrangement. Commitments oblige including discussions with bank lending officers. banks to lend up to agreed-upon amounts as long The article also includes a detailed examination as borrowers meet loan covenants included in of business lending developments since late 1981 the contract. Although there are several different as reflected in the surveys. The surveys are formal arrangements for committing banks to discussed in the appendix to this article. lend, by far the most common are revolving loan Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

2 Federal Reserve Bulletin • January 1985 commitments. Under this arrangement, borrow- 1. Commercial and industrial loans made to U.S. residents by selected large banks' ers draw down credit up to specified limits at preestablished spreads over reference rates. These Averages of month-end data loans can be repaid in part or in full during the Loans made under revolving loan term of the commitment, and any untapped commitments amounts remain available to the customer. Re- Percentage volving credit arrangements are attractive to PPPeeerrriiioooddd DDoollllaarr aammoouunntt Of all C&I borrowers because they provide some certainty ((bbiilllliioonnss)) Of all C&I loans made about the pricing of future credit needs and loans under commitment guarantee the prompt availability of funds up to a 1977:4 19.7 19.3 24.7 predetermined amount, usually over a span of 1978:4 23.5 20.3 24.8 several years. From the point of view of a bank, 1979:4 31.0 24.3 27.1 1980:4 36.6 25.7 29.1 however, commitments entail several risks. 1981:4 46.3 28.8 32.6 1982:4 62.9 34.4 40.1 First, they oblige the bank to stand ready over an 1983:4 62.5 34.0 41.2 extended period to provide credit at fixed mark- 1984:3 73.5 36.7 44.2 ups above market rates when its own future costs 1. Domestically booked loans of the approximately 114 responof funds are uncertain. Second, by increasing the dents to the Board's monthly Commercial and Industrial Loan Commitments Survey that also file a Weekly Report of Condition. likely rate of future loan growth, commitments may require a bank to augment equity or to reduce other assets under unattractive circum- 1984 LPS, the most important determinant of stances. Finally, depending on the comprehen- whether a loan to a U.S. resident is booked siveness of their covenants, commitments may domestically or at a foreign branch is the rate the expose a bank to deterioration in a customer's borrower chooses. At very large banks (those financial condition. with assets of $5 billion or more), almost half the Loans available under revolving arrangements dollar volume of loans priced off LIBOR is typically provide for two basic pricing options: booked at foreign branches; for loans priced off funds can be drawn down at a rate tied to the CD rates, the share is 10 percent. Loans priced bank's prime rate, with no set maturity, or at a oflf other market rates or the prime rate are rarely rate linked to a money market rate (such as the booked at foreign branches. LPS respondents London interbank offer rate—LIBOR—or a CD with assets of less than $5 billion generally book rate) with a fixed maturity selected by the bor- all their C&I loans domestically. C&I loans made rower, frequently 30, 90, or 180 days. The flexi- under revolving loan commitments have grown bility that revolving loan arrangements offer bor- largely at the expense of term loans and reflect rowers has made them very popular. Loans demands from a variety of industries. taken down under such arrangements have risen from about 20 percent of all outstanding domesti- A STATISTICAL PROFILE OF LOAN PRICING cally booked C&I loans at selected large banks in 1977 to more than 35 percent in 1984 (table 1). Charts 1A and IB use information on the rate These data understate, probably substantially, distribution of domestically booked short-term lending by U.S.-chartered banks under revolving C&I loans at 48 large banks to contrast current loan commitments because a number of banks loan pricing practices with those prevalent in book at their foreign branches many of the loans 1977. For this purpose, the rate distributions of taken down under the fixed-rate options that the dollar volume and the number of loans made these arrangements offer. As of October 1984, are both of interest. As the upper panel of chart loans to U.S. nonbank residents booked at for- 1A shows, in August 1984 the rates on most of eign branches of U.S.-chartered banks totaled the dollar volume of large short-term loans— $19'/2 billion. During the same month, C&I loans those of $1 million or more—were within about booked at domestic offices of 122 large banks and 75 basis points of money market rates, as meataken down under revolving commitments sured by the federal funds rate. By contrast, amounted to $73!/2 billion. According to the April smaller loans typically had rates of prime and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Changes in Loan Pricing and Business Lending at Commercial Banks 3 spreads above prime, as shown in the lower extensions data—unavoidably rough because panel of chart 1A. The rate distributions for they require a number of assumptions—suggest August 1977 illustrate that in earlier years com- that about 70 percent of the short-term C&I loan paratively few large loans were made at rates portfolio of the 48 large banks is accounted for by close to money market rates, and that for the loans made at rates below prime. The share of most part loans of all sizes had the same base C&I loans made at rates below prime at other rate, the prime rate (although, to be sure, large banks appears to be appreciably smaller. loans typically were made at prime while most The portfolio estimate of below-prime loans other loans were made at rates above prime). based on the STBL data is consistent with some Loans that are priced at spreads over market of the responses to LPS questions about the rates typically have rates that are below the share of outstanding C&I loans based on money prime rate. Consequently, the volume of loans market rates. Several money center banks rehaving below-prime rates is generally a good ported that as of late 1983, 70 percent or more of proxy for C&I lending at rates linked to market their outstanding short-term C&I loans had rates rates. STBL data indicate that the share of gross linked to money market rates. However, many short-term C&I loan extensions made by 48 large other large banks reported lower, in some cases banks at rates below prime had risen from less much lower, percentages; and for all respondents than 10 percent in 1977 to around 90 percent by the average portfolio share accounted for by late 1982. Thereafter, as table 2 shows, the share loans with market-based rates (weighted by their stabilized around this high level. C&I loans outstanding) was 52 percent. Thus, By their nature, the data on gross extensions although the evidence on the volume of C&I are dominated by loans with shorter maturities. loans in large bank portfolios having market- If, say, a bank maintained a given stock of linked rates is mixed, the share appears to be overnight loans in its portfolio during a survey substantial. week, they would appear five times in the gross extensions data, and seven-day loans in the FORCES UNDERLYING MONEY MARKET portfolio would appear once; of the ninety-day PRICING loans in the portfolio only those made during the survey week would appear in the data. As a The practice of basing lending on money market result, the STBL exaggerates the magnitude of rates became more widespread because domestic below-prime loans in bank portfolios because banks faced growing competition—from foreign almost all overnight loans and other loans with banks that historically used money market pricvery short terms are made at such rates. Howev- ing and from the rapidly developing commercial er, as table 2 illustrates, the share of gross C&I paper market—at the same time that increased loans extended at rates below prime at 48 large interest rate volatility made it difficult to change banks remains considerable even when loans the prime rate rapidly enough to reflect market with overnight and other very short terms to rates. Keeping the prime rate in alignment with maturity are excluded. Estimates of loans out- market rates became increasingly important in standing in bank portfolios based on the gross the early 1970s. On the one hand, an expanding 2. Percentage of gross extensions of short-term commercial and industrial loans made at rates below prime 1982 1983 1984 TTyyppee ooff bbaannkk aanndd mmaattuurriittyy ooff llooaann Aug. Nov. Feb. May Aug. Nov. Feb. May Aug. NOV.P 48 large banks, total1 91.0 92.2 93.7 89.2 72.0 89.0 88.9 88.2 89.6 94.0 Excluding overnight loans 80.9 83.3 83.7 77.9 46.9 79.5 72.6 73.9 76.8 82.3 Excluding loans with a maturity of a month or less 70.7 72.3 75.3 65.7 26.2 64.4 58.7 51.1 54.9 66.7 Other banks, total2 38.0 40.4 44.7 43.6 40.7 46.0 42.7 52.2 48.2 55.6 1. Consists of the 48 STBL respondents with the largest amounts of 2. Data for other banks are derived from a stratified random sample C&I loans as of June 30, 1974. of 292 insured commercial banks. p Preliminary. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

4 Federal Reserve Bulletin • January 1985 commercial paper market posed a growing com- First, First National City Bank (now Citibank) petitive challenge to banks, particularly when announced in October 1971 that it would review their lending costs failed to adjust promptly to its prime rate weekly and adjust it so as to keep it downward rate pressures. On the other hand, about 50 basis points above the rate on 90-day rapid expansion of certificates of deposit and commercial paper. Some other large banks other time deposits and the concomitant decline adopted similar formulas. Second, by the late in the relative importance of demand deposits as 1970s banks began to link some loan rates directa source of funds made banks' interest margins ly to the marginal cost of funding rather than to more susceptible to a squeeze when interest the administered prime rate. In late 1977, two rates were under upward pressure. money center banks, Morgan Guaranty and In response to these developments, banks Wells Fargo, announced "special credit facilimade their loan rates more flexible in two ways. ties," under which selected large customers 1A. Gross short-term loans extended by 48 large banks, by loan rate, August 1984 Millions of dollars Dollar volume • Small loans | Large loans • • • • • • • •• 6000 4000 2000 Number of loans 1000 800 600 400 200 10 11 12 13 14 15 Percent For notes, see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Changes in Loan Pricing and Business Lending at Commercial Banks 5 could obtain credit for a few days or weeks at tions. According to a special one-time Federal rates based on those in the money markets. The Reserve survey, total loans to U.S. residents announced purpose of these facilities was to aid booked at head offices of foreign banks and at the customers of the banks in timing their issu- their U.S. branches and agencies as of December ance of commercial paper. An important impetus 31, 1982, totaled respectively $23.6 billion and toward market-based pricing by domestically $41.1 billion. And in the four years 1978 to 1981, chartered banks was aggressive competition close to one-fifth of the net increase in bank from foreign banks, which had long used the loans on the books of U.S. nonfinancial corporapractice and were competing vigorously on that tions (excluding those booked at head offices of basis for loans to U.S. multinational corpora- foreign banks) was supplied by U.S. branches of IB. Gross short-term loans extended by 48 large banks, by loan rate, August 1977 Millions of dollars Dollar volume U Small loans 1200 H Large loans 1000 800 600 400 200 Number of loans 800 600 400 200 Percent Small loans are less than $1 million; large loans are $1 million or The initial and final bars on the charts are open-ended and include more. respectively all loans made below the lowest rate and above the * Includes loans made at the prevailing prime rate, which was 6.75 highest rate shown. percent in the August 1977 survey week and 13 percent in the August SOURCE. Survey of Terms of Bank Lending. 1984 survey week. The federal funds rate averaged 5.77 percent and 11.64 percent respectively during the 1977 and 1984 survey weeks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

6 Federal Reserve Bulletin • January 1985 3. Short- and intermediate-term business credit Annual flows, billions of dollars except as noted Type of credit and lender 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 Bank loans 31.1 -10.0 .7 20.8 35.8 45.5 37.2 49.5 41.8 23.8 U.S.-chartered banks' 26.7 -10.9 1.3 18.9 27.6 34.7 30.3 45.9 41.0 24.0 U.S. branches of foreign banks 4.3 .9 -.6 1.9 8.2 10.8 6.9 3.6 .8 -.2 Commercial paper 5.3 -3.0 2.6 2.2 4.0 10.3 8.1 17.8 -4.7 -4.0 Total 36.4 -13.0 3.3 23.0 39.8 55.8 45.3 67.3 37.1 19.8 MEMO: Share of U.S.-chartered banks (percent) 73.4 83.8 39.4 82.2 69.3 62.2 66.9 68.2 110.5 121.2 1. Includes loans to U.S. residents booked at foreign branches of U.S. banks. foreign banks (table 3). These were the years large banks, however, the implications of deregwhen the share of loans made by domestic banks ulation for business loan pricing probably were at market-linked rates rose most rapidly, though limited, because they already relied heavily on some of these banks are reported to have begun large time deposits and other managed liabilities the practice as early as 1972. having market-sensitive rates. By early 1980, Citibank, the only bank still The most important deregulatory step, the doing so, had discontinued the practice of for- introduction of money market deposit accounts mally linking its prime rate to market rates. In (MMDAs), occurred in late 1982. Inflows to view of the sharp changes in banks' funding costs MMDAs were immediate and massive. Neverand other market rates since 1980, the removal of theless, as of February 1983, only a handful of a formal link between the prime rate and money banks had responded by strengthening their market rates may have been related to the grow- practice of pricing loans directly on the cost of ing volume of domestic business lending at large funds, according to the LPS. A similarly small banks tied directly to market rates. This type of number of banks (mostly having assets of less credit is now available at all maturity ranges, than $5 billion) reported that, in response to from overnight to more than a year. Being a MMDA inflows, they had become less willing to commercial paper issuer is no longer a precondi- make fixed-rate, longer-term C&I loans. The tion for eligibility for this kind of credit, at least authorization of MMDAs appears to have inat a number of banks. creased the willingness on the part of some banks Although most large borrowings now take to make business loans, however. By May 1983, place at market-related rates, which are general- about a third of LPS respondents having assets ly below the prime rate, the prime continues to of more than $5 billion and a somewhat larger be an important measure of the cost of credit. As proportion of smaller respondents reported that noted above, most smaller loans, which account they had become more aggressive seekers of new for the great majority of the C&I loans made, are business loans as a result of MMDA inflows. For linked to the prime, and large loans taken down the large majority of LPS respondents, however, under revolving loan commitments also may be the advent of MMDAs did. not affect the type of linked to the prime. In addition, the prime rate business loans they wished to hold. serves as a base rate for other kinds of loans: many construction loans, some consumer loans, THE TWO C&I LOAN MARKETS and many syndicated Eurocurrency loans made by U.S. banks have prime-based rates. A proper analysis of the behavior of loan rates The spread of business loan pricing based on must recognize the existence of two basically market rates occurred over a period that includ- separate C&I loan markets, one in which pricing ed the virtually complete deregulation of retail is based on the lending bank's prime rate and the deposit rates. By making deposit rates more other in which loan rates are linked directly to sensitive to changes in market rates, deregula- market rates. Because the STBL does not collect tion clearly increased pressures on banks to use information on base rates, loans are separated market rates to price their business loans. For for this purpose according to size. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Changes in Loan Pricing and Business Lending at Commercial Banks 7 Large Loans These measures of funding costs appear reasonable in light of current pricing procedures as For selected types of large loans—$1 million and described by lending officers at several very above—loan rates are measured relative to esti- large banks. For overnight loans and other very mated funding costs. Because it is not apparent short-term lending, these banks typically adjust how to characterize their funding costs, no at- their base rates at frequent intervals during each tempt is made to examine the pricing of large business day to keep them in line with market floating-rate loans with maturities of between developments. For loans made at maturities of one and twelve months or of large term loans. between a month and a year, on the other hand, But for large loans with a maturity of a month or base rates are set once daily, in the morning. less, the cost of funding is taken as the federal Other procedures also have been used to estabfunds rate. For large loans having a maturity of lish base rates for loans of one month to one between a month and a year (averaging about year. Press reports from the period during which four months) and featuring fixed rates, the fund- this market was becoming established indicate ing cost is assumed to be the 90-day CD rate, that some banks were using published weekly adjusted for reserve requirements (chart 2). Like average CD rates to determine their base rates. the loan rates it is compared with in calculating Because this procedure introduces a lag between spreads, the federal funds rate is an average of the rate used to price loans and the cost of the rates during each day of the survey week funding them, it compounds lender uncertainty. weighted by the volume of transactions taking Nevertheless, some of the volatility exhibited by place at these rates. The 90-day CD rate, by the spread between rates on one-month to onecontrast, is based on a single observation early in year loans and the concurrent 90-day CD rate, as the day. depicted in chart 2, may reflect the basing of loan 2. Spread between loan rates and estimated funding costs for loans of $1 million or more, all insured commercial banks Basis points 1. Funding cost taken as 90-day rate on certificates of deposit. SOURCE. Survey of Terms of Bank Lending. 2. Funding cost taken as the federal funds rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

8 Federal Reserve Bulletin • January 1985 rates on the previous week's CD rate. For exam- binding in adjusting the CD rate, for many banks ple, when CD rates fell rapidly at the time of the they may not have been. As a result, funding May 1980 survey, the spread between loan rates costs apparently were overstated, producing the in the survey week and concurrent CD rates negative estimated "markups" for late 1979 and widened considerably. Similarly, when market early 1980 shown in chart 2. rates rose rapidly at the time of the November 1980 and May 1981 surveys, the spread narrowed and actually became negative. Estimating costs Medium-Sized and Small Loans of funding assets with CDs is also complicated by marginal reserve requirements that were in effect Rates on medium-sized loans ($100,000 to from October 1979 to July 1980. Although these $999,999) and small loans (less than $100,000) are marginal requirements are assumed to have been assumed to have the prime as a base rate; 3. Spread between loan rates and prevailing prime rate for selected sizes and maturities of loans, all insured commercial banks Basis points Spread of prime rate over 30-day commercial paper rate SOURCE. Survey of Terms of Bank Lending. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Changes in Loan Pricing and Business Lending at Commercial Banks 9 accordingly, they are measured relative to the earlier. Nevertheless, as interest rates began to prevailing prime rate, as shown in the upper fall from the record or near-record levels attained panels of chart 3. For comparison, the behavior during the summer (as chart 4 shows), LPS of the prevailing prime rate relative to market respondents on balance continued to report some rates appears in the lower panel of the chart. easing in standards to qualify for the prime rate Many smaller banks post prime rates that differ and in compensating-balance or fee requirefrom the prevailing prime, defined to be the most ments. This evidence of easing was, however, common rate posted by 30 large banks that weaker than that provided by the three previous announce their prime or base rate on a regular surveys; and, for the first time since May 1980, basis. When rates are relatively stable the aver- more banks reported tighter policies with respect age prime posted by smaller banks tends to to new and nonlocal customers than reported exceed the prevailing prime. However, the easier policies. Moreover, the standards to qualiprimes at smaller banks have tended to adjust fy for the prime rate eased during a period when more slowly than has the prevailing prime when declines in market rates outpaced drops in the market interest rates are changing. Thus, in prevailing prime, and the spread between averperiods of rapidly rising or very high market age rates on both small and medium-sized loans rates—for example, in late 1979, early 1980, and and the prevailing prime actually widened. In much of 1981—small loans (and to a lesser extent part, the slower declines in the cost of credit for medium-sized loans) made at or above the prime these loans likely reflected the tendency for rate of the lending bank often had rates that were prime rates posted at some smaller banks to lag below the prevailing prime. Loan rates below declines in the prevailing prime rate. In addition, prime are particularly evident in the case of small the emerging recession may have worsened the long-term loans. A large share of such loans perceived riskiness of loans. Spreads of rates on (more than two-thirds in 1979 and 1980) was large loans over funding costs also appeared to made at fixed rates, which presumably were widen between August and November 1981. influenced more by long- than short-term market Apparently reflecting some narrowing of the rates. Short-term rates typically exceed long- gap between the capital expenditures of nonfiterm rates, often by considerable margins, during nancial firms and their internally generated periods of intense upward rate pressures. funds, growth in business loans fell to an annual rate of 9'/4 percent for the fourth quarter, less DEVELOPMENTS IN THE C&L LOAN MARKET than half the pace of the previous quarter (see SINCE No VEMBER 1981 table 4). Loan growth likely would have,weakened more had not some bond issues been de- Since November 1981, according to the results of layed, as the cost of short-term credit fell much the Federal Reserve's surveys, the market for more rapidly than did long-term rates. According commercial and industrial loans has experienced to the LPS, 60 percent of very large banks (those several distinct periods, characterized by vary- with assets exceeding $5 billion) found substituing demands for loans and varying responses by tion of short- for long-term credit to be an banks to that demand. important source of business credit demand at that time. Most of the loan demand from this November 1981 to May 1982: Strong Loan source apparently was satisfied under revolving Demand and Accommodation by Banks credit arrangements. In the first two quarters of 1982, loan growth By November 1981, the economy had been in rebounded to the 16 percent range, despite a recession for four months. According to the LPS continued narrowing of the financing gap of taken in that month, 57 percent of respondents nonfinancial corporations. Strength in loan had noticed a deterioration in the financial condi- growth over this period was due to a further tion of their established customers; and the con- shifting from longer- to shorter-term financing as dition of the new customers of close to 40 long-term rates, while declining, remained well percent of respondents was not so good as that of above short-term rates, and bond issuance conthe new customers they had seen three months tinued to moderate. The pickup in loan growth Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

10 Federal Reserve Bulletin • January 1985 4. Growth of business loans, excluding bankers appears to have been facilitated by an easing of acceptances at commercial banks, 1980-84 loan supply conditions during the first half of Percent, seasonally adjusted annual rate 1982. By May, the spread of the prevailing prime rate over market rates was considerably narrow- Period All commercial Large banks' Other banks2 banks er than in November, while spreads of loan rates 1980: 1 16.4 16.7 15.4 over the prevailing prime were either slightly 2 -5.4 -9.0 -.9 wider or unchanged. Markups over market rates 3 15.0 13.8 16.4 4 23.4 24.0 22.0 also shrank for large loans between November 1981: 1 3.6 -7.7 16.3 2 16.2 20.7 11.3 and May. Over the periods surveyed in February 3 19.7 17.9 21.7 and May 1982, LPS respondents reported, stan- 4 9.3 14.1 4.0 1982: 1 16.5 18.4 14.5 dards to qualify for the prime or a spread over 2 15.9 21.0 9.9 3 9.0 9.5 8.4 prime changed little, while compensating-bal- 4 .5 -2.2 3.7 ance or fee requirements were eased. 1983: 1 3.6 3.5 3.6 2 -.4 -3.5 3.4 3 7.4 .0 15.6 4 10.3 6.0 14.8 1984: 1 18.2 18.4 18.0 2 17.3 24.0 10.1 3 8.0 5.1 11.1 August 1982 to May 1983: Weak Loan 1. For 1984, the 168 domestically chartered weekly reporting banks Demand and Tightening by Banks with domestic assets, as of December 31, 1982, of $1.4 billion or more; for earlier years, 171 banks with domestic assets of $750 million or more as of December 31, 1977. By August 1982, the share of LPS respondents 2. Defined as domestically chartered banks with assets of less than indicating that they had seen a deterioration in $1.4 billion or $750 million plus foreign-related banking institutions in the United States. the financial condition of their current and new 4. Selected interest rates Percent Prime •0-day commercial paper Prime rate, effective date of change; other rates, monthly averages. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Changes in Loan Pricing and Business Lending at Commercial Banks 11 5. Percentage of LPS respondents reporting $100,000. Over the same period, markups over deterioration in customers' financial condition in funding costs widened for large loans with matuthree months ending with survey date rities of a month or less and with fixed rates and maturities of a month to a year. Established New Survey date customers customers 1981 November 57 38 1982 The Period since May 1983 February 70 32 May 88 40 August 88 57 By the August 1983 survey week, market rates November 87 42 had risen and, with the prevailing prime un- 1983 February 60 n.a. changed, the spread of the prime over market rates was as narrow as it had been since before n.a. Not available. the recession began. Even so, LPS responses indicate, there was some easing of standards to customers in the preceding three months stood at qualify for the prime or a spread above prime. 88 percent and 57 percent respectively (table 5). Changes in markups over prime were mixed for According to the November LPS, these indica- small and medium-sized loans; markups on large tors of increasing financial distress had declined loans declined. For the first time in two years, only a bit as the recession came to an end, and LPS respondents on balance did not tighten their for established customers at least, the situation stance on C&I lending toward new or nonlocal continued to worsen into early 1983. Deteriora- customers. Against this backdrop of easier suption in financial condition was more common in ply conditions, loan growth in the third quarter of manufacturing, real estate (including construc- 1983 picked up to a IV2 percent rate. With the tion), and the automobile industries (including corporate financing gap still negative, much of dealers) early in the recession, according to LPS this growth reflected a substitution for long-term respondents. Later, energy and agribusiness financing as bond issuance slumped in the face of were more frequently mentioned. Most banks rising long-term interest rates. dealt with a deterioration in an established cus- In the fourth quarter, bond issuance slipped tomer's financial condition through a combina- below the already reduced level of the previous tion of additional collateral and restructuring; for quarter as long-term rates edged up. With credit new customers, the most common response was demands focused on short-term markets, growth a higher rate of loan rejection. in the outstanding commercial paper of nonfinan- Loan growth was quite sluggish over the four cial companies increased to an annual rate of quarters ending with the second quarter of 1983, about 20 percent, while business loan growth as the internally generated funds of nonfinancial picked up to a 101/4 percent pace. Most LPS firms exceeded their capital expenditures, and respondents having customers that raised funds corporate treasurers took advantage of declines in the commercial paper market in the three in long-term rates by boosting their issuance of months ending with November 1983 reported bonds. Weak loan growth over this period also that this choice of financing reflected more favormay have reflected more stringent lending poli- able rates available for commercial paper. Howcies. LPS respondents on balance reported ever, only one-fifth of LPS banks reported that tighter lending policies in the three months end- their competitive position vis-a-vis the commering with August 1982, and these policies were left cial paper market had deteriorated over the same essentially unchanged through May 1983, ac- period. STBL data indicate that spreads of rates cording to subsequent surveys. Over most of this on large loans over marginal funding costs did period, the prime rate was unusually high rela- widen in November for loans with maturities of tive to market rates. Nevertheless, in the year between a month and a year but were about ending with the May 1983 STBL, banks raised unchanged for loans of a month and under. Many their markups over prime for both short- and borrowers with highly rated commercial paper long-term loans, particularly for those less than make only limited use of banks as a source of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12 Federal Reserve Bulletin • January 1985 short-term credit, and the heavy issuance of and acquisition activity. LPS responses suggest commercial paper in the fourth quarter of 1983 that the share of gross loans extended to finance may have been concentrated among such firms. such activity fell from 20 percent in the first Business credit demands became very strong quarter to about 8 percent by September. Inin the first quarter of 1984 as the rapidly growing deed, identifiable merger-related lending activity financing needs that accompanied the maturing actually damped loan growth in September and recovery were bolstered by strong demands for in the third quarter as a whole, as repayments credit related to mergers. Bond issuance of non- exceeded extensions. Also contributing to lower financial corporations rose to its highest volume growth in business loans in the third quarter was since 1980, and commercial paper and C&I loans a shift to longer-term financing as bond issuance also surged. Responses to the April 1984 LPS surged to well above even the high pace of the suggest that almost 20 percent of the dollar first quarter. According to LPS respondents, volume of new lending in the first quarter of reduced demands for business loans also reflect- 1984, concentrated at very large banks, was to ed slower inventory accumulation and reduced finance mergers and acquisitions. Respondents capital spending. Flow of funds data, on the indicated that loan demand was boosted by a other hand, indicate that the financing gap invariety of other factors at that time too, but creased in the third quarter because investment chiefly a pickup in inventory accumulation and spending rose. STBL data do not indicate any capital spending. Growth in business loans con- clear change in supply conditions over this peritinued strong in the second quarter with identifi- od. Markups on large loans of a month and less able merger-related lending picking up a bit. declined a bit in August; for large loans with a Bond issuance moderated considerably, howev- maturity of between a month and a year, hower, as interest rates rose sharply through the ever, the estimated spread over funding costs spring and early summer. Spreads of rates on returned almost to its February level after declinsmall and medium-sized loans over the prevailing ing in May. The relative cost of small and prime declined on balance during the first two medium-sized loans was up slightly between quarters of 1984, and markups on large loans May and August. were smaller. Bank lending policies became somewhat more restrictive during the spring, after Continental Illinois Bank encountered serious difficulties as- OTHER DEVELOPMENTS IN BUSINESS sociated with market concerns about the quality LENDING BY COMMERCIAL BANKS of its assets. According to the June 1984 LPS, 44 percent of very large banks and more than one- Increased interest rate volatility in recent years third of other respondents reported tighter lend- has spawned substantial growth in futures maring terms owing to concerns about funding in kets. According to the June 1984 LPS, however, light of this development. The policy was direct- hedging opportunities provided by these markets ed mainly at requests for credit to finance lever- have not expanded the availability of long-term, aged buyouts, but also for those related to other fixed-rate business loans. Almost two-thirds of mergers and acquisitions and real estate. A few very large banks and 80 percent of other responbanks also reported more stringent terms for dents reported that the availability of interest loans to other financial institutions and for inter- rate futures had had no effect on their willingness national loans. Most banks achieved tightening to make such loans. Respondents suggested that by establishing higher standards of credit-worthi- around 5 percent of the long-term, fixed-rate ness. loans they made in the first half of 1984 were This move toward restriction apparently was funded with short-term liabilities that were short-lived. Only a handful of LPS respondents hedged with interest rate futures. The limited use attributed the sharp braking in loan growth in the banks have made of futures markets for hedging third quarter of 1984 to tighter lending policies. purposes is due partly to their ability to attract Rather, this weakness was attributed to lower ample supplies of fixed-rate liabilities to fund demand that reflected in part a decline in merger term loans, according to LPS respondents. Other Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Changes in Loan Pricing and Business Lending at Commercial Banks 13 reasons cited were the illiquidity of markets for "participating out" of loans. In this process, future contracts with distant delivery dates and very large banks originate and take a commission accounting standards that require banks to report on loans in which they then sell a participation to gains and losses on futures market instruments a bank with lower marginal costs of funds and as they occur. unused lending capacity, and can still quote the On a related issue, two-thirds of very large borrower a lower rate than they could if they banks and about one-half of other LPS respon- handled the loan entirely by themselves. Accorddents indicated that they offer forward contracts ing to the LPS, more than half of very large that allow business customers to lock in financ- banks and about one-third of other respondents ing costs on a future loan takedown. Forty had sold C&I loans or participations in them in percent of very large banks offering this service the three months ending with September 1984. hedge their forward contracts in the futures Sixty percent of respondents indicated that these markets; only 10 percent of other LPS respon- loans were purchased by small or medium-sized dents do so. banks. However, this type of business was also In recent years, banks have shown a growing done with other large banks, subsidiaries of the interest in activities that generate income but do bank or its holding company, and, to a much not demand more capital. One example is the lesser extent, foreign banks. • APPENDIX: SURVEYS OF LENDING 60-bank panel and $2.02 trillion for all federally PRACTICES AT COMMERCIAL BANKS insured commercial banks. First conducted in February 1977, the Survey The Federal Reserve has surveyed lending prac- of Terms of Bank Lending (STBL) gathers infortices at selected commercial banks since 1964. mation on the gross volume and on the rate and Through February 1981, the Senior Loan Officer selected nonrate characteristics of short- and Opinion Survey of Bank Lending Practices long-term business loans (defined respectively as (LPS) consisted of 22 standard, or "core," ques- less than one year and one year or more) extendtions regarding changes in loan demand and ed during the first full week of the middle month willingness to lend and was conducted at 120 of each quarter. The STBL panel includes 48 banks. In May 1981, the panel was reduced to 60 large commercial banks and a stratified sample banks distributed about evenly among Federal of about 292 other banks, from which estimates Reserve Districts, the number of standard ques- for all commercial banks are derived. The STBL tions was reduced to 6, and ad hoc questions also obtains data on construction and land develwere added regarding specific aspects of bank opment loans and loans to farmers. The results of lending practices of particular interest. Com- the most recent STBL are shown in the Financial mencing with the survey for February 1984, all and Business Statistics section of the FEDERAL core questions were dropped, and since then the RESERVE BULLETIN. LPS has consisted only of questions addressed to The most recent article to summarize LPS and particular bank lending practices of current inter- STBL results covered the period from late 1979 est. Also in 1984, the frequency of the survey through August 1981, and was published in the was increased from four to a maximum of eight a FEDERAL RESERVE BULLETIN, vol. 67 (Septemyear. Under the new schedule, the survey gener- ber 1981), pages 671-86. Previous articles have ally is taken several weeks before meetings of the included an appendix containing LPS survey Federal Open Market Committee, and a summa- questions and a tabulation of responses. Owing ry of results is included in briefing materials to the number of surveys reviewed in this article, prepared for those meetings. the appendix is not being published. Copies may As of December 31, 1983, 35 of the surveyed be obtained from the Banking Section, Division banks had assets of $5 billion or more. The of Research and Statistics, Board of Governors combined assets of these institutions totaled $611 of the Federal Reserve System. billion, compared with $690 billion for the entire Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

14 U.S. Monetary Policy in Recent Years: An Overview This paper was prepared by Stephen H. Axilrod, exogenous to policy in the degree that they have Staff Director for Monetary and Financial Poli- reflected shifts in preferences toward dollar ascy, Board of Governors of the Federal Reserve sets, for any given interest differential, on the System, for presentation at the conference, part of foreigners and U.S. residents who nor- "Monetary Conditions for Economic Recov- mally would have invested abroad. ery," sponsored by the University of Amster- This paper analyzes how monetary policy has dam, Amsterdam, the Netherlands, November evolved over the recent period in response to the 14-16, 1984. The views expressed in this paper exogenous forces facing it—forces that have also are not necessarily those of the Board. shaped the responses of financial and goods markets to the stance of policy. The review starts around the mid-1970s in order to set in relief the U.S. monetary policy in recent years, in terms of more recent period, beginning in late 1979, when its basic thrust, has aimed at curbing inflation there was a significant shift in monetary strateand setting the stage for sustainable economic gy—a shift that was designed not only to provide growth. In the process, the shorter-term policy greater assurance that actual inflation would be stance and the day-to-day operating procedures curbed but also to reduce inflationary expectahave been complicated by, and have had to be tions with less of a lag, given past price behavior, adapted to, a variety of powerful exogenous than might otherwise occur. A relatively prompt forces. Among the more important from the mid- abatement of expectations might be accom- 1970s through the early 1980s have been large oil plished if the public's belief in the credibility of price increases, a credit control program, dereg- monetary policy's will to achieve price stability ulation of and innovations in banking and deposit over time were greatly enhanced. If that were to markets, emergence of a large structural budget lead to quicker wage, price, and interest rate deficit, a large current account deficit in the adjustments for any given money supply target, balance of payments accompanied by what many the adjustment process to a noninflationary envibelieve to be an overvalued dollar on exchange ronment would be eased. In one sense, monetary markets, and strongly embedded inflationary ex- strategy in recent years can be viewed as a pectations. continuing struggle to attain and maintain credi- Not all exogenous forces are purely exoge- bility in the face of continuing shocks and disturnous. Rising inflationary expectations in the late bances in money, credit, and goods markets. 1970s were in part the product of earlier monetary policies (as well as other events) as these policies affected attitudes toward the future, but once embedded the expectations were exoge- THE PERIOD BEFORE OCTOBER 1979 nous to and influenced current policies—as in October 1979. The present deficit in the current The change in operating procedures announced account and the high foreign exchange value of by Chairman Volcker at an unusual Saturday the dollar also could be viewed in part as endoge- press conference on October 6, 1979, was, at the nous to policies being pursued, or at least to the time and more so in retrospect, a watershed mix of fiscal and monetary policies; however, the event. It signaled a shift to greater emphasis on deficit and the exchange rate have also been reserve aggregates in carrying out monetary poli- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

15 cy and, by implication, greater concern with The tendency for inflationary expectations to achieving goals for monetary aggregates (espe- worsen was buttressed in 1978 when price incially Ml) and less concern with interest rates. creases accelerated further and the dollar deteri- The shift had its historical basis partly in experi- orated markedly on exchange markets. Efforts ence over the several years following the first oil by monetary policy to curb these adverse develshock in late 1973 and early 1974. opments involved the conventional approaches That shock contributed to a sharp rise in the of the period. In late 1978, for instance, a pack- U.S. consumer price index of more than 12 age was announced that encompassed an inpercent from the end of 1973 to the end of 1974, crease of 1 percentage point in the discount rate, following a rise of almost 9 percent over the a supplementary reserve requirement of 2 perpreceding year. Annual price increases had gen- cent on large time deposits (the deposit instruerally been in the area of 1 to 2 percent in the last ment most readily employed by banks at their half of the 1950s and first half of the 1960s. own initiative to finance growing credit de- Subsequently, there had been a step-up to price mands), a tightening of conditions in the money increases in the range of 3 to 6 percent for the market through more restrained open market years from 1966 to 1972. operations, and, together with the U.S. Treasury Some part (a third to a half) of the faster price (and with the cooperation of foreign official instiincreases of 1973 and 1974 can be attributed to tutions), mobilization of a large amount of dollars the oil and other commodity price shocks of the to help support the currency on exchange martime, abstracting from the impact of the phase- kets. out of price controls during the period. Money In the event, this package had little success in growth had accelerated earlier in that decade, stemming inflationary pressures and attitudes. producing with some lag (of a year or two) That outcome can probably be attributed in part upward pressures on the aggregate price level. to the overhanging effect of the monetary policy But with Ml growth averaging around IVi per- pursued over the preceding several years as well cent annually in 1971 and 1972, the degree of as to the behavior of monetary aggregates during acceleration did not seem sufficient in itself to much of 1979. produce price increases as large as we saw in the In 1977 and 1978, Ml growth had accelerated aftermath of the first oil shock.1 to a pace of slightly more than 8 percent per year, However much one might apportion, on tech- after growing by an average of 51/2 percent per nical econometric grounds, the price increases year over the previous two years. Not only did after the oil shock to the shock itself or to this acceleration itself appear to signal that polimonetary policy, the price increases appear to cy was becoming more expansionary, but also have led to a rise of inflationary expectations. the credibility of policy was being eroded by the Despite the ensuing recession, consumer prices consistency with which actual Ml growth came rose 7 percent over 1975 (when they probably in above adopted target ranges in a strong econostill reflected some of the direct impact of import my. This psychological effect was made even price increases) and expanded in a range of 5 to 7 worse in the circumstances of the time by the percent during the next two years of recovery. fact that new one-year target ranges were adopt- Thus, after the initial response to the oil price ed quarterly, with the most recent quarter servshock, inflation did not revert to its earlier range, ing as a base (so that for any year there were four but was somewhat higher—even during reces- one-year target periods ending in successive sion and the early stages of recovery—reflecting, quarters of a year) and with no apparent effort to as well as providing an impetus to, higher infla- make up for the preceding overshoots. This tionary expectations. became known as "base drift." The erosion of credibility because the targets were missed and because the process of target setting also led to a 1. Alan S. Blinder, "The Anatomy of Double-Digit Infla- perception that the targets were perhaps not tion in the 1970s," in Robert E. Hall, ed., Inflation: Causes serious constraints fueled inflationary expectaand Effects (University of Chicago Press for the National tions. Bureau of Economic Research, 1982). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

16 Federal Reserve Bulletin • January 1985 In addition, it appears with the benefit of THE PERIOD FROM OCTOBER 1979 hindsight that the actual growth of Ml in 1975 TO THE FALL OF 1982 and 1976 was much more expansive than suggested by the relatively low growth rates at the The conditions facing monetary policy in the fall time—rates that were within targets adopted for of 1979 were in some respects similar to those in those years.2 There were a series of financial the fall of 1978. Inflation was worsening, as market innovations in that period spurred by signaled not only in the domestic markets but relatively high market interest rates that greatly also by a sharp drop in the dollar's value on increased the opportunity cost of holding non- exchange markets. However, by the fall of 1979 interest-bearing demand deposits and led cash it had become even clearer that the cumulative managers to seek other outlets for highly liquid lessening of confidence in monetary policy had funds.3 Depositors shifted funds out of demand contributed additionally to a substantial worsendeposits to other newly emerging, highly substi- ing of inflationary expectations. tutable instruments at banks and other deposi- Thus the policy announced on October 6, tory institutions—savings accounts that became 1979, contained a new approach to implementaavailable mainly to smaller businesses, accounts tion of open market operations, in addition to the with telephone and preauthorized transfers, and more conventional rise of 1 percentage point in so forth. Demand deposit holders probably also the discount rate and an additional reserve reshifted funds into market instruments in the quirement applicable to increases in large time process of re-evaluating their whole approach to deposits and certain other managed liabilities. cash management. It is probable that the change An important objective of the new approach was in approach to cash management in that period to help convince the public that the Federal reduced the desire to hold Ml, given actual Reserve would in practice achieve its monetary income and interest rates, on the order of 3 to 4 targets—was indeed changing its fundamental percent in each of the two years.4 This meant operating procedures to do so—and thereby inthat 5!/ 2 percent a year of Ml growth should, in crease the credibility of monetary policy and terms of its economic effect, be construed as facilitate the transition to a noninflationary envimore on the order of 8 to 10 percent—quite ronment. expansionary and well above target. This new approach has been amply described Growth of Ml failed to slow over the first three and evaluated elsewhere.5 Its essence was to quarters of 1979. At the same time, prices were secure direct control of aggregate bank replaced under additional upward pressure by the serves—for operational purposes, nonborrowed second oil shock in the early part of the year. reserves—and let interest rates vary as a product Overall price increases moved into the double- of the interaction between the nonborrowed redigit area. That had also occurred in 1974, but in serve path and the emerging demand for rethe earlier period there had been less of a buildup serves. It was believed that this approach would in inflationary expectations and less of an erosion in the credibility of the Federal Reserve's will and capacity to control the situation. 5. Stephen H. Axilrod and David E. Lindsey, "Federal Reserve System Implementation of Monetary Policy: Analytical Foundations of the New Approach," American Econom- 2. The first "year" for which Ml targets were announced ic Review, vol. 71 (May 1981, Papers and Proceedings, 1980) was the period from March 1975 to March 1976. Subsequent- pp. 246-52; Stephen H. Axilrod, "New Monetary Control ly, there were one-year targets based on each quarter of the Procedure: Findings and Evaluation from a Federal Reserve year. Starting with the 1978:4 to 1979:4, monetary targets Study," FEDERAL RESERVE BULLETIN, vol. 67 (April 1981), have pertained only to calendar years. pp. 277-90; Stephen H. Axilrod, "Monetary Policy, Money 3. While demand deposits by law earn no explicit interest, Supply, and the Federal Reserve's Operating Procedures," there are implicit positive returns, more sizable for large FEDERAL RESERVE BULLETIN, vol. 68 (January 1982), pp. businesses than for consumers and small businesses. 13-24. For a more critical assessment see Karl Brunner and 4. Richard D. Porter, Thomas D. Simpson, and Eileen Allan H. Meltzer, "Strategies and Tactics for Monetary Mauskopf, "Financial Innovation and the Monetary Aggre- Control," with related comments and replies by Axilrod, and gates," Brookings Papers on Economic Activity, 1:1979, pp. Brunner and Meltzer, Carnegie-Rochester Conference Series 213-29. on Public Policy, vol. 18 (Spring 1983), pp. 59-116. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

U.S. Monetary Policy in Recent Years: An Overview 17 increase the odds that money growth, particular- had not been repeated (or reversed) in later years ly Ml (the aggregate most closely related to the of the decade. reserve base), would in fact be controlled within Still, there were in process innovations and target ranges, given a relatively predictable rela- regulatory changes affecting the public's dispositionship between the supply of reserves and the tion to hold Ml, as well as other monetary supply of money over a reasonable length of assets, that had to be taken into account in time. Previous efforts to control money growth setting target ranges and that also necessitated a used money market conditions—typified in much redefinition of Ml and other aggregates. Interestof the 1970s by the federal funds rate (the rate bearing accounts against which checks could be charged on overnight loans of reserve funds written (termed NOW accounts), offered by both among banks)—as the guide for open market banks and thrift institutions, were introduced operations. Such efforts had foundered partly on first in New England and then in a few other policymakers' innate caution in adjusting any states. Ml was redefined in 1980 to include such policy instrument and partly, and more funda- accounts, and certain other definitional changes mentally, on the difficulty in predicting the rela- affecting it and the broader aggregates were also tionship between market interest rates and mon- made at the time.6 Later, NOW accounts were ey growth—a difficulty that was compounded by introduced on a nationwide basis at the beginning uncertainties about the interpretation and signifi- of 1981. The annual growth ranges for Ml set cance of nominal market rates being introduced from 1979 through 1981 attempted to make allowby inflationary expectations. ance for shifts in funds that would take place in The change in policy procedure, in addition to the course of the year in response to the introwhatever merits it may have had on its own as a duction of the new accounts. Effects of the shifts more effective means of controlling money, was were confined almost entirely to Ml, since shifts an effort to counteract the buildup of inflationary among various deposit instruments were offsetexpectations that was a major obstacle to an ting in the higher-order aggregates. orderly reduction of inflation. As noted earlier, Tying policy operations more closely to the those expectations may have been partly the behavior of Ml to reduce inflationary pressures result of earlier monetary policies. Inflationary and inflationary expectations heightened the expectations were also the product of two suc- need to assess on an ongoing basis whether, and cessive oil price shocks. One impact was to shift to what extent, institutional change was affecting the Phillips curve upward, leading to a higher the public's attitudes toward and use of the rate of inflation given the natural unemployment aggregate in relation to estimates made when the rate. The policy adaptation in that context repre- targets were set. This assessment was made sented an effort to improve the tradeoff between more complicated by the increased instability of unemployment and the rate of inflation by itself Ml, month by month and quarter by quarter, as leading to a shift in attitudes in labor and product compared with earlier periods. A question natumarkets that would bring the curve back down. rally arises about whether that short-run instabil- In undertaking that change, it was clearly ity was itself the product of the particular operatunderstood that the desirability of Ml, or other ing procedure used. monetary aggregates, as a policy target depended That seems doubtful in the conditions of the on its having a reasonably stable or predictable time. Much of the variation was associated with relationship to the ultimate objectives of policy— the credit control program introduced in the sustained economic growth with general price spring of 1980 and rescinded several months stability. Thus Ml would be less desirable as a later. The program as such was mild, but the policy target, or certainly as a relatively rigid psychological impact on the public was strong— one, the more the uncertainty about public pref- leading to a sharp rundown in debt, the money erences for it, given income and interest rates, as supply, and interest rates after inception and had been the case in the mid-1970s. However, evidence from econometric models suggested 6. "The Redefined Monetary Aggregates," FEDERAL REthat the large-scale demand shifts of that period SERVE BULLETIN, vol. 66 (February 1980), pp. 97-114. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

18 Federal Reserve Bulletin • January 1985 followed by a ballooning of all three after rescis- and product markets and on the position of the sion. Beyond that, the financial innovations, Phillips curve. variations in credit demands, and general uncer- Some "casual" empirical evidence that is at tainties about the future, which were engendered least not inconsistent with this conclusion may as an almost inevitable by-product of the fight be found in recent wage and price data. Through against inflation and questions about its ultimate the first year and a half of an exceptionally rapid success, were associated with large variations in economic recovery accompanied by a sharp drop attitudes toward financial assets and, concomi- in the unemployment rate, consumer prices have tantly, money. Given these conditions, it seems increased relatively moderately—remaining as if money variations had been the product around 4 percent at an annual rate. True, prices mostly of short-run demand disturbances; thus, typically do not tend to accelerate noticeably if money growth somehow could have been until later in an expansion. But wage settlements stabilized from month to month, the probable have thus far been unusually modest given the result would have been even greater interest rate reduction in the unemployment rate. volatility.7 Moreover, the policy shift in late 1982—when the new operating procedure was abandoned as Ml was de-emphasized, followed by a very rapid THE SHIFT IN POLICY APPROACH surge of Ml growth—did not tend to exacerbate IN LATE 1982 inflationary expectations. Even though Ml expanded at near an 11V2 percent rate from mid- The policy adopted in October 1979 was success- 1982 to mid-1983, long-term interest rates deful in reducing the rate of inflation—with the rate clined sharply over the period, and the dollar of increase in consumer prices dropping rapidly actually appreciated somewhat on exchange from about \2V2 percent in 1980 to about 4 markets. Thus it may be concluded that the percent in 1982. Ml growth fell to IVi percent in credibility obtained during the period of a rather 1980, 5 percent in 1981, and about 6 percent strict reserve-aggregate-Ml-oriented operating (annual rate) over the first three quarters of procedure was at least in some part responsible 1982—after growing at an annual rate of a little for enabling the Federal Reserve to accommomore than 8 percent in the two and three-fourths date to a sharp reacceleration of Ml growth years before October 1979. without igniting inflationary expectations. Of The cost of the reduction in inflation was a course, the weakness of the economy at the time substantial recession with relatively high levels was another and very important factor in keeping of unemployment. In that sense, the new operat- inflation expectations from reviving. ing procedure for monetary policy had not led to a very large, virtually miraculous downward shift of the Phillips curve, lowering the inflation rate The De-emphasis of Ml sharply for any given unemployment rate. Still, so far as can be judged from qualitative informa- The precipitating event for the de-emphasis of tion, the willingness to stick to the new proce- Ml was the maturity of a very large volume ($31 dure through a very difficult and volatile period billion) of all savers certificates in October 1982, greatly increased the Federal Reserve's credibil- and uncertainty about how Ml might be affected ity in fighting inflation. Thus it seems likely that, in the process of the public's reinvesting those as time went on, the approach itself did have at funds in other instruments.8 In addition, moveleast some beneficial impact on attitudes in labor ments of funds into and out of Ml were also 8. The certificates, which bore a very favorable yield and originally a one-year maturity, had been authorized by law a 7. Peter A. Tinsley and others, "Money Market Impacts of year earlier as part of a special effort to channel funds into Alternative Operating Procedures," in Board Of Governors of agricultural and housing loans. The large volume issued in the the Federal Reserve System, New Monetary Control Proce- first month matured in October 1982, and most holders did dures, vol. 2 (Board of Governors, 1981). not have the option of reinvesting in the certificates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

U.S. Monetary Policy in Recent Years: An Overview 19 going to be affected in uncertain amounts by creased demand for money relative to other regulatory changes scheduled within a couple of financial assets). months permitting the introduction of money- It has been much debated whether the obmarket-type accounts at banks and thrift institu- served reduction in velocity reflected a movetions. But the more sustained de-emphasis of Ml ment along an existing money demand curve as as a guide to policy implementation was connect- interest rates dropped; a shift in the existing ed basically with the change that was becoming demand curve; the emergence of a new demand observable in the public's preference for holding curve with a different interest elasticity and liquid assets in the form of Ml. There was implying a different long-run trend in velocity; or evidence of increased demand for Ml, given simply aberrant behavior related to special, nonincome and interest rates, leading to historically recurrent circumstances of the time, such as atypical, sharp declines in the velocity of Ml, or uncertainties affecting financial and other marincreases that were smaller than usual at the kets, that may have heightened precautionary same time that Ml growth was moving above demands for highly liquid assets.9 Even now, it is target ranges in the latter part of 1982 and probably too soon to be certain of the explanathrough much of 1983. tion, or of the relative importance of various While it was uncertain how long such a shift in explanations. But in view of all the unusual preference would last, it seemed at least in part circumstances and institutional changes through related to the change in the structure of deposits the early 1980s, it seems unlikely that monetary that had taken place in the previous years and in policy was dealing simply with a movement of the role played by the new assets in Ml in the money in relation to income implied by a prepublic's portfolio choices. In particular, NOW existing demand curve. Of course, even if it had accounts had grown by that time to nearly $100 been, and even if that curve implied a sufficiently billion, or almost 30 percent of the deposits in large interest elasticity of money demand, it Ml, and these accounts—whose turnover on would still be the case that rapid money growth average was low relative to demand deposits— would have needed to be encouraged. served both as a repository for longer-term sav- That conclusion would be drawn on the asings and as a means of payment. As interest rates sumption that the demand for goods and services declined in reflection of weakening credit de- at any given level of interest rates had fallen mands and abatement of inflationary expecta- exogenously (as was quite likely given the reductions, the public increased the amount of funds it tion of inflationary expectations), so that an was willing to place in NOW accounts, just as it especially large actual money growth was rewas also increasing the amount of funds flowing quired both to encourage economic expansion into ordinary savings accounts. As market inter- and to satisfy the demands of money holders. In est rates declined, the opportunity cost of hold- other words, given a downward shift in the ing money in interest-bearing NOW accounts demands for goods and services, the velocity of dropped relatively more rapidly than did that of money would tend to drop for any given money demand deposits that bore no explicit interest. supply; the choice for policy is whether the drop Thus, incentives for holding Ml-type assets had was to be reflected more in rising money or in shifted favorably. lower income. Even without the change in the structure of Ml caused by the introduction of NOW accounts, 9. Stephen H. Axilrod, "Issues in Monetary Targeting and one might well have expected a decrease in Ml Velocity," in Federal Reserve Bank of San Francisco, Monevelocity as interest rates dropped sharply. And tary Targeting and Velocity, Proceedings of a Conference, the drop relative to a prior trend might have been December 1983 (December 1983), pp. 4-13; Thomas D. Simpson, "Changes in the Financial System: Implications for expected to be permanent in the degree that it Monetary Policy," Brookings Papers in Economic Activity, reflected a downward adjustment of inflationary 1:1984, pp. 249-72; Flint Brayton, Terry Farr, and Richard expectations (with increased demand for money Porter, "Alternative Money Demand Specifications and Recent Growth in Ml" (Board of Governors of the Federal relative to goods) and an associated sustained Reserve System, Division of Research and Statistics, May lower level of market interest rates (with in- 1983). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

20 Federal Reserve Bulletin • January 1985 Since the latter part of 1983, the income veloci- Partly in view of the uncertainties that came to ty of Ml has been rising at a pace not far from affect the monetary aggregates because of instithat of earlier cyclical experience. This has con- tutional change, the Federal Reserve also introtributed to some restoration of confidence in that duced a broad credit aggregate—the debt (whethaggregate as a guide, though it has not been er incurred in domestic markets or abroad) of restored to the role it had before late 1982. It is domestic nonfinancial sectors—for monitoring still too soon to be sure about the underlying purposes, and began stipulating annual growth trend, not to mention the cyclical behavior, of ranges for that aggregate as well as for measures the velocity of Ml, given the changed composi- of the money supply. A debt aggregate is less tion of the aggregate as well as the new deposits affected by shifts in preferences for differing and fund outlets (such as money market deposit financial assets, and provides a basis for assessaccounts and money market funds) in other, ing the interaction of credit and money demands higher-order aggregates that also serve as both a in relation to the underlying policy objective of means of payment and a store of liquidity. sustained economic growth and reasonable price Many take the view that the trend increase of stability. Ml velocity has been lowered on the thought that, with deregulation of deposit rates, the pace of technological innovation may diminish. Also, The Impact of Fiscal Policy with deposits in Ml affected more by saving motives, the elasticity of demand with respect to The credit variable and its components have income may be higher than it has been. But the proved to be especially useful in evaluating the intensifying competition for financial and pay- impact of fiscal policy on credit markets and in ments services and the still evolving deposit relation to monetary policy. Fiscal policy, as markets leave considerable room for doubt about measured by growing high-employment deficits any such conclusion with respect to Ml and have (accompanied by even larger actual deficits), has also complicated and made more uncertain the been a major element in shaping the rapid recovinterpretation of the other monetary aggregates. ery and expansion following the 1981-82 reces- In all of these circumstances, while the aggre- sion. In 1983, U.S. government debt expanded gates remain as important guides to policy opera- 211/2 percent, whereas it had risen less than 8V2 tions and policy objectives are presented in percent on average in the first year of five terms of money and credit aggregates, ongoing previous recoveries. At the same time, private money supply behavior has needed to be inter- debt rose about 8 percent, close to its pace in the preted, more so than usual, in light of surround- first year of earlier recoveries. Spurred evidently ing economic and financial conditions. The im- by the rise in federal borrowing, total debt rose plementation of policy has thus necessarily almost 11 percent last year, about 3 percentage become more judgmental than it was in the points more than the average for earlier recoverperiod from late 1979 to late 1982. The result is ies, while nominal GNP grew about the same that changes in pressures on bank reserve posi- as it did on average in the comparable earlier tions do not respond more or less automatically periods. to variations in money demand as they affect the By the second year after a cyclical low in demand for reserves relative to a fixed path for economic activity, federal debt expansion nornonborrowed reserves. Rather, the reserve path mally slows sharply, to about a 4 percent rate. In is adjusted more frequently, on a week-to-week the first half of 1984, however, federal debt basis, to accommodate to short-run money be- expansion, while slowing somewhat from the havior, with the degree of reserve pressure em- year before, still was at a very rapid 15 percent bodied in the path—indexed by the amount of annual rate. At the same time, private debt borrowing allowed for at the discount window— expansion accelerated to about an 11 percent set judgmentally, in light of incoming informa- annual rate (abstracting from growth of mergertion, as is thought consistent with desired money related debt issues), about the same as in compaand credit growth over a longer period. rable periods of earlier recoveries. The sustained Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

U.S. Monetary Policy in Recent Years: An Overview 21 strength of federal debt expansion brought total While this good price performance partly reflects debt growth in the first half of 1984 to an annual the still relatively sizable amount of unused labor rate of a little less than 12 percent (again ab- and plant resources, it may also reflect the stracting from merger-related debt)—above the strengthened conviction that monetary policy range for the year anticipated by the Federal will in fact restrain inflation and work toward Reserve in setting its money and credit ranges price stability. But the ability of U.S. demands and also nearly 4 percentage points more than in for goods and services to increase unusually the second year of earlier expansions. rapidly in the first 18 months of recovery without With fiscal policy remaining quite stimulative signs of further price pressure also needs to be into the second year of expansion, and with the considered in relation to the relatively high value market concerned that deficits will remain large of the dollar on exchange markets and the sharp even as economic growth continues, nominal and turn toward deficit in the U.S. current account of presumably real interest rates have remained the balance of payments—a deficit that reached relatively high. Indeed, market rates rose into $42 billion in 1983 and may be estimated at close the summer of 1984. However, after midyear, to $90 billion at an annual rate in the first half of and through early fall, first long-term and later 1984 (with trade deficits that are some $15 billion short-term interest rates declined somewhat, re- to $20 billion deeper). tracing a part of their rise earlier in the year. The deficits have permitted expansion of The behavior of interest rates during the cur- spending by domestic sectors without concomirent year has been consistent with growth of Ml tant pressure on U.S. productive capacity and and M2 within target ranges. The money demand resources. Over the first six quarters of recovfunction, which behaved atypically during the ery, real GNP rose 1XU percent (annual rate) recession and very early in the recovery, has while real spending increased 83/4 percent (annual seemed in late 1983 and thus far in 1984 to be rate). As an aspect of those developments, primore consistent with historical expectations. vate investment and the federal deficit were Thus the rise of interest rates in the first part of financed to a greater extent than normal by net 1984 can be viewed more as the result of strong inflows of foreign saving. Such inflows amounted credit demands stemming from an upward shift to almost 12'/2 percent of the sum of net private in the demand for goods and services, impelled in investment and the federal deficit in 1983 and part by the continued federal deficit. Subsequent rose to 20 percent in the first half of 1984. declines of rates probably reflected moderation, More remarkable than these arithmetic relaor expected moderation, of private credit de- tionships to GNP and its components is the fact mands, and demand for money as economic that the current account deficits have not been growth slowed over the summer and as indica- accompanied by any significant tendency for the tions of upward price pressures remained limit- dollar to decline in value on exchange markets. ed. In addition, there was some lessening of Indeed, quite the opposite: from the end of 1982 tension in the financial system as Latin American through September 1984, the dollar rose about 22 debt negotiations were in process of resolution percent on a multilateral trade-weighted basis. and problems with certain large depository insti- Foreigners have been quite willing to finance tutions were contained. U.S. consumption in excess of output and private investment and a budgetary deficit in excess of domestic saving. The question naturally arises The Balance of Payments and the whether this willingness should be construed as Dollar Exchange Rate an event exogenous to policy or as the product of policies in place. The strength of demands for goods so far in 1984 It is probably some of both. As a response to has not been reflected in additional upward price policies, it would seem to be related less to pressures, or in conventional signs of anticipated monetary policy alone than to the mix between upward price pressures such as intentions to fiscal and monetary policies—a mix that has accumulate inventories well ahead of sales. worked, through shifts noted above in the de- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

22 Federal Reserve Bulletin • January 1985 mand for goods and services induced by fiscal associated with initiation of the credit control policy, to keep interest rates higher than they program in early 1980 and during the recession of otherwise would be. As an event exogenous to 1982 when inflationary expectations began to policy, it reflects the shift of international invest- wane; upward shifts appeared as the credit conment preferences toward the United States, for trol program was lifted and more recently in the any given interest differential, caused by political wake of the turn to a quite expansionary fiscal disturbances abroad, reduced confidence in policy. The shifts related to the psychological countries burdened with debt crises, and a posi- impact of the credit control program were very tive change in attitude toward the United States short run in nature, disturbances of no more than as confidence in its economy revived (signaled a quarter or so. The impacts of other shifts noted first, perhaps, by the huge stock market rally in were sustained over a longer period. Meanwhile, the second half of 1982). through much of the period since the mid-1970s Particularly to the extent that dollar exchange there were widespread institutional and regularates have remained high for exogenous reasons, tory changes introducing new instruments to one might view the current account deficit as serve as money or money substitutes, or affectdetermined by the capital account rather than ing the implicit or explicit price of old instruvice versa. In that sense, the growing demand for ments, that also led to shifts in the demand for goods and services could be accommodated in money relative to historical experience. part by "artificially" low-priced imports, taking 2. It is by now very conventional wisdom that pressure off domestic resources and keeping the a money supply target for monetary policy will level of domestic prices lower than it would produce better policy in the face of shifts in the otherwise be. Once the exogenous shift in invest- demand for goods and services than it will in the ment preferences toward the dollar is completed, face of shifts in the demand for money. It does and particularly if it begins to be reversed, there not necessarily follow that a money supply taris the risk that domestic prices will adjust up- get, or guide, should be abandoned when there ward—although any such rise could be moderat- are shifts in the demand for money. So long as ed to the extent that domestic demands are shifts in demand for goods and services are with reduced commensurately (by, for example, more us—and I suspect that they are, except on some fiscal restraint) or to the extent that foreigners occasions, the dominant type of shift—there is absorb a reduction in home-currency profits obvious value to a money supply guide, but one more than they usually do. However that eventu- that necessarily entails certain judgmental adally works out, the unusually large current ac- justments to allow for, among other things, shifts count deficit and relatively high exchange rate in money demand. make it difficult to be certain that progress to- 3. Shifts in money demand may be most easily ward price stability has been as great as the and clearly allowed for in advance in monetary published price series may suggest. targets when a regulatory change is known to be about to take place, such as payment of interest on demand deposits (to which the introduction of CONCLUDING OBSERVATIONS NOW accounts was tantamount), with fairly predictable one-time effects. When institutional This broad review of monetary policy in the change is taking place from an internally generat- United States during recent years suggests a ed market process, as in 1975-76, it is extremely number of general observations, as well as obser- difficult to know what will happen in advance, vations more specific to current conditions. requiring adjustments on an ongoing basis as best 1. Monetary policy has been confronted by that may be estimated. Or after the initial adjustshifts both in the demand for goods and services, ment to a regulatory change, like the introducgiven interest rates, and in the demand for mon- tion of NOW accounts nationwide, has been ey, given interest rates and income. Downward accomplished, it may also be some time before one can be reasonably certain in advance how shifts in the demand for goods and services the public will respond in varying economic seemed evident from the psychological impact Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

U.S. Monetary Policy in Recent Years: An Overview 23 circumstances, given the changes in the compo- sion. The prospects for curbing inflation further sition of money assets and presumably also in the are also subject to doubt because the lack of motives and sensitivity to changing market con- progress so far in reducing planned federal defiditions of money holders. cits raises questions in the minds of market 4. The advantage of retaining money guides is participants about the will of the government that they provide protection against the ever- generally. present, unanticipated shocks to demand for 6. Nominal market interest rates that have goods and services and provide the public with a been high relative to the comparatively low insense that there is a discipline on the central crease observed in the average level of prices as bank, even though uncertainties about money the current economic expansion has continued demand tend to argue for a more judgmental may be taken as an indication that inflationary approach to policy implementation, including a expectations, though lower than in the early willingness to adjust targets in light of evolving 1980s, remain well above zero. However, intercircumstances. For instance, one might argue est rates appear to have been high in real as well that money growth targets should have been as nominal terms, reflecting in part the exogelowered in 1975-76, just as the Ml target was nous upward shift in the demands for goods and effectively raised in 1982-83. The ability of a services engendered by the continuing stimulacentral bank to adjust or miss monetary targets tive fiscal policy. without impairing its credibility in fighting infla- 7. In contrast to the behavior of interest rates tion depends on the underlying conviction in the in credit markets, price and wage behavior in marketplace that the central bank has the will to labor and product markets does not seem to encourage price stability. That obviously de- suggest particularly strong inflationary expectapends on surrounding circumstances, actual tions. Unless one takes the view that the real rate price behavior, and the whole historical back- of return on investment goods over time will be ground that goes into determining a central exceptionally high, the question arises as to why bank's "image." In the late 1970s, money target borrowers have been willing to pay the prevailing misses and evidence of accelerating prices erod- high nominal and real market interest rates. ed the market's confidence in the Federal Re- Business borrowers would do so to finance longserve's will. That has not happened thus far in er-term capital outlays either if they expected the 1980s, reflecting, one might judge, the credi- inflation to accelerate or if they expected market bility gained by the policy approach taken from rates to decline. In the latter respect, while the late 1979 to the fall of 1982 and the continuing present yield curve does not suggest future rate moderate behavior of prices after that policy declines, corporate financing has been concenapproach was dropped and a more judgmental trated in the short-term market or in floating-rate one (but one still based on money targets) adopt- obligations, an approach consistent with expeced. Moreover, money growth in 1984, as mea- tations, or hopes, that current capital outlays can sured by Ml and M2, has been well within target be refinanced later at lower market rates. There ranges. is an obvious potential for problems if there are 5. While the credibility of monetary policy has expectational differences about inflation between increased in recent years, there is probably some real and financial markets—or between expectaway to go before the public is fully convinced tions in both markets and intentions on the part that policy is aimed at and will achieve price of monetary policymakers. A conflict in expectastability over some reasonable period of time. tions between financial and real markets cannot Considerable progress has been made in curbing be long sustained; it is resolved either as expecinflation, but there can be doubt about the exact tations in financial markets improve or as they extent of progress to date, in part because of the worsen in real markets. An improvement of still relatively strong dollar exchange rate in the inflationary expectations in financial markets face of persistent large current account deficits could take the form of shifts out of money-type and in part because the more intense upward assets into intermediate- or longer-term securiprice pressures normally come later in an expan- ties, with consequent downward impacts on in- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

24 Federal Reserve Bulletin • January 1985 terest rates on such securities, as well as on to be refundable at lower rates). Assuming U.S. short-term interest rates as reserves were provid- monetary policy is in fact on a course toward ed to maintain money growth. A worsening of reasonable price stability over time, an early expectations in real markets would be manifest- improvement in financial market expectations ed in upward price pressures needed, among represents the smoother process of adjustment— other reasons, to generate the income for servic- an improvement that would be greatly promoted ing debt bearing high interest rates (as it became by a turn toward a less expansionary fiscal more feared that existing debt would not turn out policy. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

25 Staff Studies The staffs of the Board of Governors of the indicate concurrence by the Board of Governors, Federal Reserve System and of the Federal by the Federal Reserve Banks, or by the mem- Reserve Banks undertake studies that cover a bers of their staffs. wide range of economic and financial subjects. Single copies of the full text of each of the From time to time the results of studies that are studies or papers summarized in the BULLETIN of general interest to the professions and to are available without charge. The list of Federal others are summarized in the FEDERAL RESERVE Reserve Board publications at the back of each BULLETIN. BULLETIN includes a separate section entitled The analyses and conclusions set forth are "Staff Studies" that lists the studies that are those of the authors and do not necessarily currently available. STUDY SUMMARY MERGERS AND ACQUISITIONS BY COMMERCIAL BANKS, 1960-83 Stephen A. Rhoades—Staff, Board of Governors Prepared as a staff study in the fall of 1984. For many years, economists have been interest- tion, and the size of acquired and acquiring ed in merger activity because of the potential firms. An addendum summarizing bank merger implications for competition, overall economic activity in 1983 is also included. concentration, and the organizational structure, Some of the conclusions from the data are that motivation, and performance of acquiring firms. from 1960 through 1983, there were 4,805 bank In spite of the critical role of banks in the mergers and acquisitions involving $206.3 billion economy, there has never been a thorough docu- in acquired assets. Merger activity increased mentation of bank mergers that could be used for sharply in the 1980s as did the proportion of descriptive and analytical purposes. mergers that were horizontal. Even after ac- This study provides a description of bank counting for inflation, acquired firms tended to merger activity from a merger documentation be larger toward the end of the period. Finally, project that has taken four person-years. The the ten leading acquirers accounted for about 10 study presents data on the 4,373 bank mergers percent of the banks and assets acquired, but and acquisitions from 1960 through 1982 by state, only a few of the 25 largest banking organizations year, type of merger, approving federal regula- in the country were among the ten most active tor, type of market, type of acquiring organiza- acquirers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

26 Industrial Production Released for publication November 15 index for October was 6.6 percent higher than a year earlier. Total industrial production was unchanged in In market groupings, output of durable con- October following a decline of one-half percent sumer goods edged down 0.1 percent, but nonduin September and a rise of 0.1 percent in August. rable consumer goods rose 0.3 percent reflecting Production of equipment and consumer goods gains in the production of food, fuel, and other increased moderately in October, but the output goods. The scheduled rebound in auto assemof materials and construction supplies was re- blies from the strike-depressed annual rate of 6.9 duced. At 165.2 percent of the 1967 average, the million units in September did not materialize. In 1967 = 100 1967 = 100 All series are seasonally adjusted and are plotted on a ratio scale. Auto sales and stocks include imports. Latest figures: October. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

27 1967 = 100 Percentage change from preceding month PPPeeerrrccceeennntttaaagggeee ccchhhaaannngggeee,,, Grouping 1984 1984 OOOcccttt... 111999888333 tttooo OOOcccttt... Sept. Oct. June July Aug. Sept. Oct. 111999888444 Major market groupings Total industrial production 165.2 165.2 1.0 .9 .1 -.5 .0 6.6 Products, total 166.9 167.1 1.2 1.3 -.1 -.2 .1 7.4 Final products 164.9 165.3 1.2 1.3 .0 -.2 .2 8.3 Consumer goods 161.6 161.9 .8 .5 -.8 -.6 .2 3.2 Durable 160.2 160.1 1.4 .1 -.6 -1.6 -.1 2.2 Nondurable 162.2 162.7 .6 .7 -.9 -.1 .3 3.6 Business equipment.. 188.0 188.5 2.6 2.4 1.2 .1 .3 16.9 Defense and space... 138.0 139.0 .3 1.8 .7 .9 .7 13.1 Intermediate products.. 174.3 173.8 1.1 1.3 -.3 -.5 -.3 4.4 Construction supplies 159.7 158.3 .9 .6 -.4 -.9 -.9 3.9 Materials 162.8 162.1 .6 .4 .5 -.9 -.4 5.3 Major industry groupings Manufacturing 166.9 167.2 .9 1.0 .3 -.5 .2 7.0 Durable 157.2 157.3 1.0 1.5 .6 -.6 .1 10.2 Nondurable 180.8 181.4 .8 .3 -.1 -.5 .3 3.3 Mining 128.4 123.7 1.6 2.3 -1.1 -.1 -3.7 4.6 Utilities 180.2 180.3 1.1 -1.4 -.7 -.2 .1 2.2 NOTE. Indexes are seasonally adjusted. October, parts shortages caused by the Cana- equipment parts declined, and little change ocdian auto strike held car output to an annual rate curred in other components. Among nondurable of 7.0 million units; light truck production de- materials, production of chemicals increased but creased substantially. Output of home goods was textile output continued to decline. off slightly following a 0.9 percent gain in Sep- In industry groupings, manufacturing output tember. Production of business equipment in- increased 0.2 percent in October following a creased only moderately for the second month as decrease of 0.5 percent in September. Durable the output of transit equipment—especially goods manufacturing edged upward during the trucks—and farm equipment was reduced. Pro- month, reflecting gains in steel and nonelectrical duction of construction supplies declined an esti- machinery, while nondurables increased 0.3 permated 0.9 percent. cent. To reduce stockpiles built earlier in antici- Production of total materials declined 0.4 per- pation of a strike, coal mining output was recent, largely reflecting a sharp reduction in coal duced very sharply. Output of utilities changed output. Among durable materials, there was little. some increase in production of metals. Output of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

28 Announcements CHANGE IN THE DISCOUNT RATE holding companies and one commercial firm to acquire "nonbank banks." Board action on the pending applications was required this week to avoid automatic and The Federal Reserve Board approved a reducunconditional approval, under existing law, due to the tion in the discount rate from 9 percent to 8V2 passage of time after the receipt of the applications. percent, effective November 21, 1984. The dis- Final consideration of these applications had been count rate is the interest rate that is charged deferred pending Congressional disposition of bills before it that would plainly have prohibited such depository institutions when they borrow from acquisitions. However, while the proposed legislation the Federal Reserve bank in their District. was approved in somewhat different form by the The reduction was taken against the back- Senate and by the House Banking Committees, Conground of growth in Ml and M2 in the lower part gress adjourned without final action. The Board is of the desired ranges and in the context of fully aware that the leadership of both the Senate and House Banking Committees have indicated their intendistinct moderation in the pace of business extion to reintroduce such legislation and seek passage pansion, of relative stability in producer and early in the next Congressional session in a form that commodity prices in recent months, of the re- would require divestiture of any nonbank banks strained trend of wages and costs, and of the formed after June 30, 1983. continued strength of the dollar internationally. In these circumstances, the majority of the Board felt it had no alternative but to approve the pending In announcing the change, the Board voted on applications as technically consistent with the current requests submitted by the boards of directors of law, despite serious reservations about the consistenthe Federal Reserve Banks of New York, Phila- cy of the proposal with basic policy established by delphia, Richmond, Chicago, St. Louis, Minne- Congress in the Bank Holding Company Act. Our apolis, Kansas City, Dallas, and San Francisco. concerns in this respect have focused on both unfair competitive distortions that can result from exploita- The Board subsequently approved similar retion of narrow loopholes to achieve broader purposes, quests from the Federal Reserve Banks of Bosand, even more fundamentally, on the possibility of a ton and Atlanta, effective November 23, and progressive unraveling of the basic tenets of public from the Federal Reserve Bank of Cleveland, policy that underlie the Bank Holding Company Act— effective November 26. that is, the maintenance of banks as impartial providers of credit, and the avoidance of undue risk and conflicts of interest in the banking system. With respect to these issues and within the frame- CONDITIONAL APPROVAL OF APPLICATIONS work and intent of present law, in approving the TO ACQUIRE NONBANK BANKS applications the Board imposed certain broad conditions upon its approval that it had first established in the U.S. Trust case decided last March. These condi- In connection with the announcement on tions prohibit the parent company of a nonbank bank November 1, 1984, by the Federal Reserve from: (1) operating the nonbank bank's demand depos- Board of the conditional approval of applications it taking activities in tandem with operation of any to acquire nonbank banks, Chairman Paul A. other subsidiary or other financial institution; (2) link- Volcker sent the accompanying letter on this ing in any way the demand deposit and commercial lending services that define a bank under the Act; and matter to the leadership of the Senate and House (3) allowing the nonbank bank to engage in any trans- Banking Committees. action with affiliates, other than the payment of dividends to the parent or the infusion of capital, without November 1, 1984 the Board's approval. In effect, these conditions will require nonbank banks to operate as separate entities independent from the other operations of the parent Dear Mr. Chairman: and its subsidiaries. As you are aware, the Board of Governors has had We have also emphasized to the applicants the before it for some time applications by three bank potential need for divestiture of nonbank bank acquisi- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

29 tions should Congress pass legislation you have spon- Transaction Amount (dollars) sored and that we support. Similarly, we have stressed that the fact that the Board was constrained by the Wire transfer of funds technical aspects of the bank definition in the Act to Basic transfer originated .55 Basic transfer received .55 approve the applications before it should not be con- Off-line origination 5.50 strued as encouragement to the applicants to consum- Telephone advice 3.00 mate these proposals or to others to pursue similar Net settlement1 acquisitions. Settlement entry 1.30 I would also like to note that a minority of the Board Off-line settlement 8.00 Telephone advice 3.00 would have denied these applications on the basis of existing law. While the majority did not share this 1. For cases in which net settlement arrangements result in higher view, the Board as a whole is unanimous in its concern operating costs than those incurred for standard arrangements, the about the dangers of proceeding through loophole Reserve Banks may establish higher fees. exploitation and about the need for prompt Congressional action to remedy this problem. The revised schedule of fees for automated The Board has repeatedly emphasized the dangers of permitting the financial system to evolve in a clearinghouse services is intended to recover 80 haphazard and potentially dangerous way through the percent of costs, compared with 60 percent in exploitation of technical "loopholes" in existing law, 1984. and the need for fresh direction by the Congress along In setting its revised fees for ACH services, the lines of the legislation proposed earlier this year. the Board re-evaluated several aspects of ACH We feel no less strongly today, and welcome the efforts you have made toward developing new law fees. These include the use of benefit-based fees, appropriate to today's competitive and market circum- the level of transaction fees, fees for delivery by stances while preserving those basic continuing ele- other than electronic means, and fee recovery of ments of public policy with which we, as you, have the costs of handling of ACH return items and been concerned. notification of change. Current fees for corporate trade payments will remain in effect. Sincerely, The revised ACH fee schedule for 1985 is Paul A. Volcker shown in the accompanying tables. Amount (cents CHANGES IN FEES FOR WIRE TRANSFERS Transaction fees except as noted) OF FUNDS AND AUTOMATED Origination CLEARINGHOUSE SERVICES Intra-ACH 1.0 Inter-ACH Unsorted 1.8 The Federal Reserve Board has approved a Presorted 1.2 Night time surcharges reduction in the fee the Federal Reserve Banks Debits 6.0 Next-day credits 3.0 charge depository institutions for originating or receiving a transfer of funds over the Federal Receipt Intra-ACH 1.0 Reserve System's wire transfer of funds network Inter-ACH 1.8 New York 1.2 and a revised schedule of fees for automated Paper return items and clearinghouse services. notifications of change (dollars) 2.50 The changes for wire transfer are effective December 27, 1984, as are most of the revisions in automated clearinghouse services. Fixed fees Amount (dollars except as noted) The Board acted under the directives of the Monetary Control Act of 1980, which require the Deposit fees Tape handling 3.00 per tape Federal Reserve to charge for its services to File processing 1.00 per file depositories. Receiver handling fees Courier 3.00 per delivery The Board approved the following schedule of Messenger pick-up 1.25 per delivery fees for wire transfers and for net settlement Telephone advice service, reducing the fee for basic wire transfers Including ten pieces of information 2.50 Each additional piece of information (cents) 05 from 60 cents to 55 cents per transfer: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

30 Federal Reserve Bulletin • January 1985 NEW FEE SCHEDULES FOR CHECK services will be established in order to generate suffi- COLLECTION SERVICES cient revenue to cover the anticipated costs of providing services to depository institutions for the calendar year, rather than to offset prior years' surpluses and The Federal Reserve Board has approved fee shortfalls. schedules for 1985 for the check collection ser- The Board believes that this policy better advances vices of the Federal Reserve Banks, effective the Federal Reserve's objective of promoting efficien- December 27, 1984. The 1985 fee schedules are cy in the payment mechanism than does the alternative approach of accumulating surpluses and shortfalls. If, available from the Reserve Banks. for example, the Federal Reserve were to establish a The 1985 check collection fees are generally lower price to compensate for a previous year's surabout the same as in 1984. The System's check plus, inefficiencies could result as below-cost pricing collection fees are set to recover anticipated might lead to services being produced by the Federal costs, including the cost of check float and the Reserve at a higher societal cost than if they had been produced by other service providers. In addition, the private sector adjustment factor. This last represhort-term fluctuations in Federal Reserve fees that sents imputed taxes that would have been paid could result from compensating for previous years' and the return on capital that would have been surpluses or shortfalls could be disruptive to the provided for had the services been furnished by a Federal Reserve, other providers of payment services, private business firm. Federal Reserve check and users of such services. Moreover, other providers of payment services do not typically establish prices in float results from the Federal Reserve giving order to eliminate surpluses or shortfalls incurred in credit to depository institutions that sent the prior years. Finally, if the Federal Reserve seeks to checks to the Federal Reserve for collection but match costs and revenues each year, any surpluses or for which the Federal Reserve has not yet re- shortfalls incurred should be reduced, if not eliminatceived payment from the institutions to which ed, over time. the check was sent for payment. Accordingly, the Board has determined that it is appropriate to continue the current policy of establish- The Federal Reserve estimates that revenues ing Reserve Bank fees for Federal Reserve services in for check collection in 1985 will be approximate- order to generate sufficient revenue to cover the ly $433 million and that the System's costs will anticipated costs of providing services to depository be approximately $415 million. These estimates institutions for the calendar year, rather than to offset prior years' surpluses and shortfalls. include the public sector adjustment factor and the anticipated cost of float during the year. APPROVAL OF PRIVATE SECTOR ADJUSTMENT FACTOR PRICED SERVICESTREATMENT OF SURPLUSES AND SHORTFALLS The Federal Reserve Board has approved a private sector adjustment factor (PSAF) for 1985 The Federal Reserve Board has approved a of $61.1 million. The PSAF for 1985 represents statement of policy respecting the treatment of an increase of $2.3 million, or approximately four surpluses and shortfalls that arise from the provipercent, from the target PSAF for 1984. sion of services to depository institutions for The PSAF is an allowance for the taxes that which, in accordance with the Monetary Control would have been paid and the return on capital Act of 1980, fees are charged. that would have been provided had all of the The policy statement formalizes the Federal Federal Reserve's priced services been furnished Reserve's current practice of establishing fees by a private business firm. for its services designed to recover projected The PSAF is determined by applying the Fedcosts for the calendar year, rather than to offset eral Reserve's pre-tax cost of capital to the the previous year's surpluses or shortfalls. assets used by the Federal Reserve in the production of priced services. These assets are The Monetary Control Act of 1980 requires that determined on a direct basis and include the net "over the long run, fees shall be established on the effect of those assets expected to be acquired and basis of all direct and indirect costs actually incurred. ..." Consequently, the Board has established disposed of during the year. Short-term assets the policy that Reserve Bank fees for Federal Reserve are assumed to be financed by short-term debt Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 31 and long-term assets are assumed to be financed 1980 and the Garn-St Germain Depository Instiby a combination of equity and long-term debt. tutions Act of 1982. The ratio of long-term debt to equity and the The Monetary Control Act requires the Board rates for short-term debt, long-term debt, equity, to amend its Regulation D (Reserve Requireand income taxes are based on the experience of ments of Depository Institutions) annually to the 25 largest U.S. bank holding companies. Also increase the amount of transaction accounts subincluded in the PSAF are imputations for esti- ject to a reserve requirement of 3 percent in the mated sales taxes, insurance assessment by the next calendar year to 80 percent of the annual Federal Deposit Insurance Corporation, and the percentage increase in transaction accounts held expenses and fixed assets of the Board of Gover- by all depository institutions. The growth in total nors related to the development of priced ser- net transaction accounts of all depository instituvices. tions from June 30, 1983, to June 30, 1984, was 3.8 percent. The statutory rule thus requires an increase of $900 million, to $29.8 million. MODIFICATION TO EXTENDED CREDIT The Garn-St Germain Act requires the Board PROGRAM to amend Regulation D to adjust the amount that is exempt from reserve requirements for the The Federal Reserve Board announced on No- upcoming year by 80 percent of the annual vember 8, 1984, a technical modification in its percentage increase in total reservable liabilities. extended credit program to permit the applica- Growth in total reservable liabilities was 9.1 tion of a flexible rate under certain conditions. percent from June 30, 1983, to June 30, 1984, Under usual procedures, institutions borrow- requiring an increase in the reserve requirement ing funds on an extended basis pay the basic exemption to $2.4 million. discount rate for the first 60 days, an additional 1 percent surcharge for the next 90 days, and a 2 percent surcharge for any borrowings outstand- AMENDMENT TO REGULATION Z ing for more than 150 days. This procedure was modified earlier to provide a flexible, market- The Federal Reserve Board has announced the related rate in certain circumstances. adoption of an amendment to Regulation Z The new procedure will retain the basic struc- (Truth in Lending) clarifying that all credit cards ture for the first 150 days of borrowing but will are subject to the provisions of the regulation regularize alternative structures of flexible mar- regarding the issuance of credit cards and the ket-related rates for borrowing for more than 150 liability for unauthorized use. The amendment days. becomes effective December 31, 1984. The amendment applies to credit cards issued for use in transactions that are exempt from all AMENDMENT TO REGULATION D other provisions of Regulation Z. The amendment states that such cards are subject nonethe- The Federal Reserve Board has announced an less to the provisions of Regulation Z that limit increase in the amount of net transaction ac- cardholder liability for unauthorized use of the counts to which the lowest—3 percent—reserve card to $50 and that prohibit issuance of credit requirement will apply in 1985 from $28.9 million cards that have not been requested. to $29.8 million. The Board also increased the The amendment principally affects credit cards amount of reservable liabilities in depository issued for use in certain extensions of credit of institutions that are subject to a zero percentage more than $25,000, and for extensions of credit reserve requirement from $2.2 million to $2.4 ftfr public utility services. Such extensions of million. The adjustments take effect beginning credit are generally exempt from the provisions January 1, 1985. of Regulation Z. The vast majority of credit cards The Board made the changes in accordance affected by the amendment are telephone calling with provisions of the Monetary Control Act of cards. The amendment will not affect the applica- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

32 Federal Reserve Bulletin • January 1985 tion of the exemptions noted above to other for high- or low-unit-cost endpoints. Comments provisions of Regulation Z. must be received by January 11, 1985. The Federal Reserve Board has also requested comment on a proposal to amend Regulation AA AVAILABILITY OF BANK HOLDING (Unfair or Deceptive Acts or Practices) to apply COMPANY LIST to banks rules substantially similar to those recently adopted by the Federal Trade Commis- The annual list of Bank Holding Companies and sion prohibiting certain debt collection practices Subsidiary Banks, Foreign and Domestic, as of in consumer credit obligations. The Board re- December 31, 1983, is available now. There will quested comment by January 28, 1985. be a $12.00 charge for the book, and remittance The Federal Reserve Board has published for should be made payable to the order of the Board comment proposed changes to the official staff of Governors of the Federal Reserve System. To commentary on Regulation E (Electronic Fund order a copy, please forward the request and Transfers). The changes pertain to questions that remittance to the Office of the Controller, Feder- have arisen about the regulation and include new al Reserve Board, Washington, D.C. 20551. interpretations and changes to existing interpre- When the book becomes available each year, an tations. Comment is requested by January 31, announcement will appear in the FEDERAL RE- 1985. SERVE BULLETIN because a mailing list will no The Board has also published for comment longer be maintained. proposed changes to the official staff commen- Publication of a separate list of domestic assets tary on Regulation Z (Truth in Lending). The and deposits of bank holding companies is being changes pertain to questions that have arisen discontinued. about the regulation and include new interpretations and changes to existing interpretations. Comment is requested by January 31, 1985. PROPOSED ACTIONS The Federal Reserve Board has requested com- SYSTEM MEMBERSHIP.ment by December 14, 1984, on an application by ADMISSION OF STATE BANKS Bankers Trust New York Corporation to expand the scope of the activities of its subsidiary, BT The following bank was admitted to membership Futures Corp., which engages in futures commis- in the Federal Reserve System during the period sion merchant activities. November 1 through December 1, 1984: The Board issued for comment a proposal to permit the Federal Reserve Banks to use a two- Colorado tier fee schedule for the collection of certain Colorado Springs State Bank and Trust checks depending on whether they are destined of Colorado Springs Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

33 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON OCTOBER 2, 1984 Domestic Policy Directive The information reviewed at this meeting indicat- force—a decline accounted for by youths under ed that growth in real GNP had slowed apprecia- 25, apparently related to their leaving jobs and bly in the third quarter from the annual rate of returning to school—and the civilian unemployabout 8V2 percent recorded in the first half of the ment rate was unchanged at 7.5 percent. ^ year. The slowing was most marked in final Consumer spending, after rapid growth earlier, sales, which seemed to grow little during the was notably weaker during the summer. The quarter, while the rate of inventory accumulation advance report on retail sales in August suggestappeared to have accelerated. Thus far in 1984, ed a decline of about 3A percent; moreover, the the rise in various measures of prices and wages decline in sales in July, originally reported to be appeared to be close to, or slightly below, the about 1 percent, was revised substantially to 2 pace in 1983. percent. Sales of new domestic automobiles, Industrial production edged up 0.2 percent in hindered by a shortage of popular models, August, after climbing 0.9 percent in both June dropped to an annual rate of 7.6 million units in and July. Output of consumer durable goods fell August. However, a rebound to an 8.5 million markedly in August, largely reflecting fewer as- unit pace was reported for the first 20 days of semblies of automobiles and light trucks, and September, reflecting in part the early introducproduction of nondurable consumer goods also tion of 1985 models by some major producers. declined. In contrast, production of equipment Housing starts fell appreciably in August to 1.5 for business and defense continued to advance million units. Starts of single-family units, declinbriskly, and output of construction supplies ing for the fourth consecutive month, were more edged up. With production gains moderating in than 20 percent below their average in the second August, capacity utilization in manufacturing quarter. Multifamily starts, which had changed was unchanged, after a sizable increase in July. little on balance over the spring and early sum- At 82.8 percent, the utilization rate was slightly mer, fell to a level about 17 percent below their higher than the 1967-82 average and 14 percent- second-quarter pace. Newly issued building perage points above the postwar low registered in mits for both types of structures moved down for late 1982. the second straight month. Gains in employment slowed in recent months. Information on outlays and spending plans As measured by the establishment survey, non- suggested that the expansion in business fixed farm payroll employment (adjusted for strikes) investment in the third quarter had been slower rose a little over 200,000 per month in July and than the exceptionally rapid pace over the pre- August, about two-thirds the average monthly ceding year. In August, orders placed at U.S. increase during the first half of 1984. As mea- manufacturers for nondefense capital goods fell sured by the survey of households, employment for the third consecutive month, and shipments fell sharply in both July and August, partly edged off further after an appreciable decline in reversing exceptionally large increases in the two July; in contrast, purchases of equipment from preceding months. In August, the drop was abroad continued to climb. Backlogs of unfilled about equal to the decline in the civilian labor orders, which were still relatively large, contin- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

34 Federal Reserve Bulletin • January 1985 ued good levels of corporate profits, and report- to be quite small, and while there appeared to be ed increases in business spending plans in the a moderate acceleration in September, expanlatest Department of Commerce survey suggest- sion over the three-month period from June to ed further growth in capital expenditures. September was running well below the Commit- Incoming information on prices and wages tee's expectations. Growth of M2 and M3 also generally indicated a continuation of recent fa- appeared to have picked up in September after vorable trends. The producer price index for expanding at relatively sluggish rates over the finished goods edged down 0.1 percent in Au- previous two months, but growth in these broadgust; the index had risen 0.3 percent in July but er aggregates over the summer was also lower had shown no change in the three preceding than expected. months. The consumer price index rose 0.5 per- Expansion of total domestic nonfinancial debt cent in August after an increase of 0.3 percent in was estimated to have been at an average annual July. Thus far in 1984, producer and consumer rate of around WA percent in July and August, prices had risen at annual rates of about 2Vi and keeping growth thus far in 1984 at a pace well 4VA percent respectively, and the index of aver- above the Committee's monitoring range of 8 to age hourly earnings had increased at an annual 11 percent for the year. Expansion of private rate of about 23A percent. debt was estimated to have eased a bit from the The foreign exchange value of the dollar fluc- rapid rates recorded earlier in the year, as the tuated widely in often volatile market conditions growth of mortgage and consumer borrowing but rose sharply on balance over the intermeet- slowed somewhat and merger financing abated. ing period. By September 20 the dollar had risen Expansion in business borrowing remained at a 7 percent to a new high; since then, it had relatively rapid pace, however, and growth of declined somewhat to a level about 5 percent federal debt surged. above its value at the time of the August FOMC Against the background of monetary growth meeting. In this environment, monetary authori- that was weaker than anticipated, evidence of a ties intervened, some on a substantial scale, in slowing pace of economic advance, and a rapidly exchange markets. The U.S. foreign trade deficit rising dollar in foreign exchange markets, open increased to a record high rate in the July- market operations were conducted, as the inter- August period, as a further surge in non-oil meeting period progressed, so as to lessen presimports overwhelmed a moderate increase in sures on bank reserve positions. In the two exports. complete reserve maintenance periods ending in At its meeting on August 21, 1984, the Com- September, adjustment plus seasonal borrowing mittee had adopted a directive specifying no averaged about $750 million, down from an averchange in the degree of pressure on reserve age of about $1 billion over the previous interpositions in the period immediately ahead, but meeting period. The easing in bank reserve posicalling for a response to any significant deviation tions was reflected in a decline in the federal in the aggregates from expectations, viewed funds rate from the area of 11 Vi to 1 WA percent at against the background of economic and finan- the time of the August FOMC meeting to a range cial developments. The members had anticipated around 11 percent recently, though day-to-day that this approach to policy implementation trading levels fluctuated widely. In short-term would be consistent with growth of Ml, M2, and markets, yields on Treasury securities fell about M3 over the period from June to September at V* percentage point over the intermeeting interannual rates of around 5 percent or slightly less, val, and those on private instruments declined IV2 percent, and 9 percent respectively. The about V2 percentage point. Most long-term interintermeeting range for the federal funds rate was est rates declined about 5 to 30 basis points, left unchanged at 8 to 12 percent. while yields on municipal bonds increased under heavy supply pressure. Most major banks re- As the intermeeting period progressed, incomduced their "prime" lending rate from 13 to 123/4 ing information pointed to continuing substantial percent. shortfalls in growth of the monetary aggregates relative to the Committee's expectations for the The staff projections presented at this meeting third quarter. Growth of Ml in August turned out suggested that real GNP would expand at a Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the Federal Open Market Committee 35 moderate pace over the remainder of the year to financial strains. Reference was also made to and in 1985. The unemployment rate was project- the related possibility that consumers might tend ed to decline somewhat further over the period, to curtail their spending if uncertainties about and the rate of price increase was expected to economic and financial conditions should intenpick up a little from its recent pace, as the sify. In that event growth in business spending economy continued to move toward fuller utili- might also be scaled back, with inventories espezation of its productive resources. cially likely to become a less expansive factor. The Committee's discussion of the economic Several members referred to the progress that situation and outlook focused on the implications had been made in containing inflation, although of recent indications of appreciably slower some threats to future progress remained, and a growth in the context of an economic outlook few members commented that inflation was still that was already complicated by unusually large, the main economic problem for the longer run. In sustained federal deficits, a strengthening dollar this connection, concern was expressed that too on exchange markets, and sensitive domestic strong a resurgence in spending, though not and international financial markets. Many mem- viewed as a likely development, would intensify bers commented that the economy appeared to inflationary pressures and would set in motion be adjusting to a reduced, but potentially more forces, which could threaten the sustainability of sustainable, rate of expansion and that the mod- the expansion itself. Moreover, as the foreign eration was likely in turn to be associated with exchange value of the dollar rose, the possibility relatively subdued rates of wage and price infla- increased that a subsequent decline in the extion. It was noted that many past expansions had change rate could be precipitous when it ocbeen interrupted by a "pause" in the rate of curred, which would exert significant upward economic growth. Although no one could say pressures on domestic prices. Prior experience with certainty whether this most recent experi- suggested that those pressures would emerge ence represented a "pause" and, if so, how long after some lag, but one member commented that it would last, a number of members believed that the lag might well be shorter than usual as many a modest rebound was a likely prospect for the domestic producers attempted to restore profit next quarter or two followed by some modera- margins that were held down by foreign competition in the rate of expansion later. Other mem- tion. On the favorable side, it was noted that bers gave more weight to elements of slowing in apparently diminished inflationary expectations, the current economic situation, and they saw a relatively restrained wage settlements, and a greater likelihood of sluggish growth in the peri- business climate favoring improvements in prood ahead. ductivity had enhanced the prospects for con- While acknowledging a greater potential for taining inflation. adverse developments, a number of members At its meeting in July, the Committee had stressed various factors that seemed conducive reviewed and reaffirmed the basic policy objecto continued satisfactory expansion in economic tives that it had established in January for growth activity. Among these were the direct economic of the monetary and credit aggregates in 1984 and stimulus provided by fiscal policy; a high level of had set tentative objectives for growth in 1985. consumer confidence sustained by continued For the period from the fourth quarter of 1983 to growth in disposable incomes and relatively the fourth quarter of 1984, the policy objectives strong financial positions; and a favorable cli- included growth of 4 to 8 percent for Ml and 6 to mate for business investment fostered by gener- 9 percent for both M2 and M3. Through Septemally good profit levels, substantial tax incentives, ber, Ml apparently grew at a rate close to the and reduced margins of unused capacity. Other midpoint of the range for the year, M2 at a rate members, who were somewhat more concerned somewhat below the midpoint of its range, and about the prospects for economic activity, M3 at a rate near the upper limit of its range. For placed more emphasis on the retarding influ- 1985 the Committee had established tentative ences of lower housing expenditures, the compe- ranges that included reductions from the upper tition of imports, and the vulnerability of some limits of the 1984 ranges for Ml and M2 of 1 and depository institutions, businesses, and farmers xh percentage point respectively and no change in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

36 Federal Reserve Bulletin • January 1985 the range for M3. For both years the associated ary pressures or economic activity and if the range for growth in total domestic nonfinancial dollar remained under strong upward pressure in debt was set at 8 to 11 percent. the foreign exchange markets. Others, while not In the Committee's discussion of policy imple- disagreeing that there might be a need to reduce mentation for the weeks immediately ahead, restraint over the coming intermeeting period, most of the members favored directing open emphasized that policy implementation should market operations, at least initially, toward also be alert to potential developments that might maintaining the lesser degree of reserve restraint call for greater restraint and that any move in that had been sought in recent weeks. Such an either direction should be carried out in a cauapproach to policy was expected to be associated tious and probing manner. with expansion in the monetary aggregates from At the conclusion of the Committee's discus- September to December at rates that were some- sion, a majority of the members indicated that what above those experienced over the third they favored or could accept a directive that quarter, especially in the case of Ml. It was called for maintaining the lesser degree of noted in this connection that the degree of re- restraint on reserve positions that had been atserve restraint had been eased appreciably in tained over recent weeks. The members expectrecent weeks and that any further easing should ed that such an approach to policy implementabe contingent upon clear evidence of further tion would be consistent with growth of Ml, M2, weakness in the monetary aggregates and the and M3 at annual rates of about 6, IVi, and 9 economy. A number of members expressed par- percent respectively for the period from Septemticular concern that under current conditions ber to December. Somewhat lesser restraint appreciably lesser restraint might well induce a would be acceptable if growth of the monetary sharp decline in market interest rates, excessive aggregates should fall significantly short of exmoney growth, and an unsustainably strong re- pectations, with any adjustment in operations to bound in economic activity. These members be evaluated in the context of the strength of the noted the risk that such a decline in interest rates business expansion and inflationary pressures, might have to be strongly reversed later with conditions in domestic and international financial damaging conseqences for the financial system markets, and the rate of credit growth. Conand the economy. Some members, however, versely, greater restraint might be acceptable in favored a prompt further lessening of reserve the event of substantially more rapid growth in restraint. They deemed such an approach to the monetary aggregates than was currently exoperations to be desirable for a number of rea- pected, provided such growth was associated sons, including the recent behavior of the mone- with evidence that economic activity and inflatary aggregates, the progressive slowdown in the tionary pressures were strengthening significanteconomic expansion since the first quarter, the ly. It was agreed that the intermeeting range for relatively favorable outlook for inflation, and the the federal funds rate, which provides a mechastrength of the dollar in foreign exchange mar- nism for initiating consultation of the Committee, kets. should be left unchanged at 8 to 12 percent. In the course of discussing how operations At the conclusion of the meeting the following should respond to incoming information, most of directive was issued to the Federal Reserve Bank the members agreed that the Committee should of New York: be prepared to respond a little more promptly in an easing than in a tightening direction, should The information reviewed at this meeting suggests monetary developments deviate significantly that the expansion in economic activity slowed apprefrom expectations. In this view policy implemenciably in the third quarter from a strong pace earlier in tation, given recent shortfalls in money growth, the year. In August, industrial production rose only should be relatively tolerant, up to a point, of any slightly and gains in nonfarm payroll employment tendency for expansion in the monetary aggre- moderated further; retail sales and housing starts declined for the second month in a row. The civilian gates to strengthen more than expected, espeunemployment rate was unchanged in August at 7.5 cially if such growth were not accompanied by percent. Information on outlays and spending plans clear indications of a strengthening of inflation- suggests slower expansion in business fixed invest- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the Federal Open Market Committee 37 ment, following exceptionally rapid growth in recent ships not only among the various measures of money quarters. Since the beginning of the year, average and credit but also between those aggregates and prices and the index of average hourly earnings have nominal GNP, including evaluation of conditions in risen more slowly than in 1983. domestic credit and foreign exchange markets. In August the monetary aggregates expanded at In the implementation of policy in the short run, the relatively slow rates, but data available for September Committee seeks to maintain the lesser degree of suggested some strengthening. From the fourth quar- restraint on reserve positions sought in recent weeks. ter of 1983 through September, Ml apparently grew at This action is expected to be consistent with growth in a rate close to the midpoint of the Committee's range Ml, M2, and M3 at annual rates of around 6, IVi, and 9 for 1984, M2 at a rate somewhat below the midpoint of percent, respectively, during the period from Septemits longer-run range, and M3 at a rate near the upper ber to December. A somewhat further lessening of limit of its range. Growth in total domestic nonfinan- restraint on reserve positions would be acceptable in cial debt appears to be continuing at a pace above the the event of significantly slower growth in the mone- Committee's monitoring range for the year, reflecting tary aggregates, evaluated in relation to the strength of large government borrowing along with relatively business expansion and inflationary pressures, domesstrong private credit growth. Interest rates generally tic and international financial market conditions, and have fallen somewhat further since the August meeting the rate of credit growth. Conversely, greater restraint of the Committee. might be acceptable in the event of substantially more Over the past month, the foreign exchange value of rapid monetary growth and indications of significant the dollar against a trade-weighted average of major strengthening of economic activity and inflationary foreign currencies has fluctuated widely under often pressures. The Chairman may call for Committee volatile market conditions, reaching a new high in the consultation if it appears to the Manager for Domestic latter part of September; since then the dollar has Operations that pursuit of the monetary objectives and declined somewhat. The merchandise trade deficit related reserve paths during the period before the next rose sharply to a record high rate in the July-August meeting is likely to be associated with a federal funds period. rate persistently outside a range of 8 to 12 percent. The Federal Open Market Committee seeks to foster monetary and financial conditions that will help to reduce inflation further, promote growth in output on a Votes for this action: Messrs. Volcker, Solomon, sustainable basis, and contribute to an improved pat- Boehne, Boykin, Corrigan, Gramley, Mrs. Horn, tern of international transactions. In furtherance of Messrs. Partee, and Wallich. Votes against this these objectives the Committee agreed at the July action: Messrs. Martin, Rice, and Ms. Seger. meeting to reaffirm the ranges for monetary growth that it had established in January: 4 to 8 percent for Ml and 6 to 9 percent for both M2 and M3 for the Messrs. Martin, Rice, and Ms. Seger dissented period from the fourth quarter of 1983 to the fourth from this action because they preferred a direcquarter of 1984. The associated range for total domestive calling for a somewhat lesser degree of tic nonfinancial debt was also reaffirmed at 8 to 11 reserve restraint and marginally faster monetary percent for the year 1984. It was anticipated that M3 and nonfinancial debt might increase at rates some- growth in the fourth quarter. In their view some what above the upper limits of their 1984 ranges, given additional easing of reserve positions would be developments in the first half of the year, but the appropriate given the reduction in monetary Committee felt that higher target ranges would provide growth over the third quarter and indications of inappropriate benchmarks for evaluating longer-term further slowing in the rate of economic expantrends in M3 and credit growth. For 1985 the Committee agreed on tentative ranges of monetary growth, sion. Somewhat lesser restraint would not incur measured from the fourth quarter of 1984 to the fourth a significant risk of stimulating inflation and quarter of 1985, of 4 to 7 percent for Ml, 6 to would also be desirable in light of current condipercent for M2, and 6 to 9 percent for M3. The tions in domestic and international financial marassociated range for nonfinancial debt was set at 8 to kets. Mr. Martin in particular expressed concern 11 percent. about strains now being experienced by some The Committee understood that policy implementation would require continuing appraisal of the relation- financial institutions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

39 Legal Developments AMENDMENTS TO REGULATION D excess of $2.4 million determined in accordance with section 204.3(a)(3) of this Part. The Board of Governors is amending 12 C.F.R. Part 204 (Regulation D—Reserve Requirements of Depository Institutions) to increase the amount of transactions accounts subject to a reserve requirement ratio AMENDMENTS TO REGULATION Z of three per cent, as required by the Monetary Control Act of 1980 from $28.9 million to $29.8 million; and to The Board of Governors has amended its Regulation increase the amount of reservable liabilities of each Z—Truth in Lending to specifically provide that credit depository institution that is subject to a reserve cards issued for use with transactions that are exempt requirement of zero per cent, as required by the Garn- from all other provisions of the regulation are subject St Germain Depository Institutions Act of 1982 from to the Regulation Z provisions governing the issuance $2.2 million to $2.4 million. of credit cards and the liability for unauthorized use. Effective January 1, 1985, the Board amends The amendment resolves any uncertainty that the 12 C.F.R. Part 204, Regulation D by revising para- issuance and liability protections apply to all credit graph (a) of section 204.9 to read as follows: cards regardless of use or cardholder status. Effective December 31, 1984, the Board amends Reserve Requirements of Depository 12 C.F.R. Part 226, Regulation Z, by adding an Office Institutions of Management and Budget control number to section 226.1, and by removing existing footnote 4 in section Part 204 226.3 and replacing it with a new footnote 4, to read as follows: Section 204.9—Reserve Requirement Ratios Truth in Lending (a)(1) Reserve percentages. The following reserve ratios are prescribed for all depository institutions, Part 226 Edge and Agreement Corporations, and United States branches and agencies of foreign banks: Section 226.1—Authority, Purpose, Coverage, Organization, Enforcement and Liability Category Reserve requirement Net transaction accounts (Information collection requirements contained in this section have $0 to $29.8 million 3 percent of amount been approved by the Office of Management and Budget under OMB over $29.8 million $894,000 plus 12% of amount over Control No. 7100-0199.) $29.8 million Nonpersonal time deposits By original maturity (or notice period): Less than 1 Vi years 3 percent 1 Vi years or more 0 percent Section 226.3—Exempt Transactions Eurocurrency liabilities 3 percent This regulation does not apply to the following: 4**:i (2) Exemption from reserve requirements. Each depository institution, Edge or Agreement Corporation, and U.S. branch or agency of a foreign bank is subject to a zero percent reserve require- 4. The provisions in section 226.12(a) and (b) governing the issuance of credit cards and the liability for their unauthorized use apply ment on an amount of its transaction accounts to all credit cards, even if the credit cards are issued for use in subject to the low reserve tranche in paragraph connection with extensions of credit that otherwise are exempt under this section. (a)(1), nonpersonal time deposits, or Eurocurrency liabilities or any combination thereof not in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

40 Federal Reserve Bulletin • January 1985 BANK HOLDING COMPANY, BANK MERGER, AND 9.8 percent of the total deposits in commercial banks BANK SERVICE CORPORATION ORDERS ISSUED in the state. Consummation of this proposal would not BY THE BOARD OF GOVERNORS have a significantly adverse effect on the concentration of commercial banking resources in Virginia. Orders Issued under Section 3 of Bank Holding Applicant and Company compete in the Norfolk- Company Act Portsmouth banking market,3 where all of Bank's offices are located. Applicant is the fourth largest Bank of Virginia Company commercial banking organization in the Norfolk-Ports- Richmond, Virginia mouth banking market, controlling 7.5 percent of the deposits in commercial banks in the market.4 Compa- Order Approving Acquisition of Shares of a Bank ny is the seventh largest banking organization in the Holding Company market and controls 4.2 percent of the deposits in commercial banks in the market. Upon consummation Bank of Virginia Company, Richmond, Virginia, a of the proposed transaction, Applicant would become bank holding company with the meaning of the Bank the third largest banking organization in the Norfolk- Holding Company Act of 1956, as amended (12 U.S.C. Portsmouth market, and would control 11.7 percent of § 1841 et seq.) ("Act"), has applied for the Boards' the deposits in commercial banks in the market. approval pursuant to section 3(a) (3) of the Act The share of deposits held by the four largest (12 U.S.C. § 1842(a) (3)) to acquire up to 40.3 percent commercial banking organizations in the Norfolkof the voting shares of Citizens Trust Company, Portsmouth banking market is 71.2 percent, and the Portsmouth, Virginia ("Company"), and indirectly of market's Herfindahl-Hirschman Index ("HHI") is Citizens Trust Bank, Portsmouth, Virginia ("Bank").1 1875. Upon consummation of this proposal, the four- Notice of the application, affording interested per- firm concentration ratio would increase to 75.4 percent sons an opportunity to submit comments, has been and the HHI would increase 63 points to 1938.5 While given in accordance with section 3(b) of the Act. The the proposed acquisition would eliminate existing time for filing comments has expired, and the Board competition in the Norfolk-Portsmouth market, the has considered the application and all comments re- Board believes that the anticompetitive effects of this ceived in light of the factors set forth in section 3(c) of proposal are mitigated by the extent to which thrift the Act (12 U.S.C. § 1842(c)). institutions compete with commercial banks in the Applicant, the fourth largest commercial banking market.6 organization in Virginia, controls one subsidiary bank The 14 thrift institutions that compete in the market with total deposits of $2.8 billion, representing 9.3 hold total deposits of $1.9 billion, representing approxpercent of the total deposits in commercial banks in imately 41 percent of the total deposits in commercial the state.2 Company, the 13th largest commercial banks and thrift institutions in the market. Four of the banking organization in Virginia, holds deposits of market's six largest depository institutions are thrift $123.5 million, representing approximately 0.5 percent institutions. The thrift institutions in the market offer of the deposits in commercial banks in the state. Upon NOW accounts and are active in consumer lending. consummation of the proposed transaction, Applicant Moreover, four of the market's thrift institutions offer would remain Virginia's fourth largest commercial banking organization and would control approximately 3. The Norfolk-Portsmouth banking market is defined as the Nor- 1. Applicant has applied to acquire 96,932 shares of Company folk-Portsmouth Ranally Metro Area. (representing 18.1 percent of Company's shares) and $8,000 principal 4. Market data are as of June 30, 1984. amount of Bank's debentures, which are convertible into 529 shares 5. Under the Department of Justice Merger Guidelines, a market in (or 0.5 percent) of Company's common stock. The shares and which the post-merger HHI is above 1800 is considered highly debentures would be acquired through the exercise of an option concentrated. In such a market, where the increase in the HHI is less purchased from United Virginia Bankshares Incorporated. If this than 100 but more than 50 points, the Department considers a number application is approved, Applicant intends to make an offer for the of factors to determine whether they mitigate the decrease in competiremaining outstanding shares of Company and merge Bank into tion in the market. If such mitigating factors are present, the Depart- Applicant's subsidiary bank. Applicant has entered into a merger ment is unlikely to challenge the merger. agreement with Company and will file a separate application with 6. The Board has previously determined that thrift institutions have respect to the anticipated merger transaction. In its present applica- become, or at least have the potential to become, major competitors of tion, Applicant also seeks approval to exercise an option to purchase banks. NCNB Corporation, 70 FEDERAL RESERVE BULLETIN 225 from Company 200,000 newly issued voting shares. This second (1984); Sun Banks, Inc., 69 FEDERAL RESERVE BULLETIN 934 (1983); option would, if exercised, result in Applicant's purchase of a total of Merchants Bancorp, Inc., 69 FEDERAL RESERVE BULLETIN 865 40.3 percent of Company's voting shares. (1983); First Tennessee National Corporation, 69 FEDERAL RESERVE 2. Statewide banking data are as of December 31, 1983. BULLETIN 298 (1983). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 41 commercial lending services and commercial transac- acquire all of the voting shares of the successor by tion accounts. Based upon this and other evidence of merger to First National Bank of Carthage, Carthage, record, the Board has concluded that the competition Illinois ("Bank"). offered by thrift institutions in the Norfolk-Portsmouth Notice of the application, affording opportunity for market mitigates the anticompetitive effects of this interested persons to submit comments, has been proposal and has determined that consummation of the given in accordance with section 3(b) of the Act. The proposal would not have a significant adverse effect on time for filing comments has expired and the Board existing competition in the market.7 has considered the application and all comments re- The financial and managerial resources and future ceived in light of the factors set forth in section 3(c) of prospects of Applicant, Company, and Bank are satis- the Act (12 U.S.C. § 1842(c)). factory and consistent with approval of this applica- Applicant is the seventh largest commercial banking tion. Considerations relating to the convenience and organization in Illinois, controlling 18 banks with total needs of the communities to be served also are consist- deposits of $1.14 billion, representing 1.1 percent of ent with approval. Based on these and other facts of the total deposits in commercial banks in the state.1 record, it is the Board's judgment that consummation Bank is one of the smaller commercial banks in of the proposed transaction would be in the public Illinois, with total deposits of $23.4 million, representinterest and that the application should be approved. ing less than 0.1 percent of total deposits in commer- On the basis of the record, the application is ap- cial banks in the state. Upon consummation of this proved for the reasons summarized above. The trans- proposal, Applicant would control total deposits of action shall not be consummated before the thirtieth $1.16 billion, representing 1.1 percent of total deposits calendar day following the effective date of this Order in commercial banks in the state, and its rank would or later than three months after the effective date of remain unchanged. Accordingly, consummation of this Order, unless such period is extended for good this proposal would have no significant effect on the cause by the Board, or by the Federal Reserve Bank of concentration of banking resources in Illinois. Richmond pursuant to delegated authority. Within the relevant banking market,2 Bank is the By order of the Board of Governors, effective second largest of six commercial banks, with 19.4 November 21, 1984. percent of total deposits in commercial banks. Neither Applicant nor any of its principals are associated with Voting for this action: Chairman Volcker and Governors any other banking organization in the relevant banking Martin, Wallich, Partee, Rice, Gramley, and Seger. market. Accordingly, no existing competition would be eliminated as a result of this proposal. JAMES MCAFEE The Board has considered this proposal in light of its [SEAL] Associate Secretary of the Board proposed guidelines for assessing the competitive effects of market-extension mergers or acquisitions.3 The Carthage banking market is not highly concentrat- First Midwest Bancorp, Inc. ed under the Board's guidelines, is not located in a Joliet, Illinois SMSA, and is not considered attractive for entry. Accordingly, consummation of this proposal would Order Approving Acquisition of a Bank not result in any significant adverse effects on probable future competition in this market. First Midwest Bancorp, Inc., Joliet, Illinois, a bank The financial and managerial resources of Appliholding company within the meaning of the Bank cant, its subsidiaries, and Bank and their future pros- Holding Company Act ("Act") (12 U.S.C. § 1841 pects are considered consistent with approval of this et seq.), has applied for the Board's approval under proposal, particularly in light of recent improvements section 3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to 7. If 50 percent of the deposits held by thrift institutions were included in the calculation of market concentration, Applicant's post- 1. Banking data are as of December 31, 1983, and have been merger market share would be 8.7 percent, making it the fourth largest adjusted to reflect bank holding company acquisitions approved as of depository institution in the market. Furthermore, when thrift data are July 5, 1984. considered, consummation of the proposal would increase the mar- 2. The relevant banking market is the Carthage banking market ket's four-firm concentration ratio to 56 percent and would increase which is defined as the townships of Bear Creek and St. Albans and the HHI only 35 points, from 1141 to 1176. The Justice Department the eastern two tiers of Hancock County, all in Illinois. has stated that where a post-merger market HHI is between 1000 and 3. 47 Federal Register 9017 (March 3,1982). Although the proposed 1800 and the merger produces an increase of less than 100 points, the policy statement setting forth these guidelines has not been adopted Department is unlikely to challenge such a merger. In this case, the by the Board, the Board is using the guidelines in its analysis of the increase would be less than 100 points. effects of a proposal on probable future competition. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

42 Federal Reserve Bulletin • January 1985 in certain of Applicant's subsidiary banks. Applicant ceived in light of the factors set forth in section 3(c) of has proposed no new services for Bank. There is no the Act. evidence in the record that the banking needs of the Applicant, the fourth largest banking organization in community to be served are not being met. According- Florida, controls two banking subsidiaries with total ly, considerations relating to the convenience and deposits of approximately $3.8 billion, representing needs of the community to be served are also consis- 6.5 percent of the total deposits in commercial banks tent with approval. in the state.2 Company, with deposits of approximate- Based on the foregoing and other facts of record, the ly $36.7 million, is one of the smaller commercial Board has determined that this application should be banking organizations in Florida, controlling less than and hereby is approved. The transaction shall not be 0.1 percent of the total deposits in commercial banks consummated before the thirtieth calendar day follow- in the state. Upon consummation of this transaction, ing the effective date of this Order, or later than three Applicant would remain the fourth largest banking months after the effective date of this Order, unless organization in the state and would control 6.6 percent such period is extended for good cause by the Board or of the total deposits in commercial banks in the state. the Federal Reserve Bank of Chicago, acting pursuant Accordingly, consummation of this proposal would to delegated authority. not have a significant effect upon the concentration of By order of the Board of Governors, effective banking resources in Florida. November 1, 1984. Applicant competes directly with Company's subsidiary bank in the Eastern Palm Beach County bank- Voting for this action: Chairman Volcker and Governors ing market.3 Applicant is the ninth largest commercial Wallich, Partee, Rice, Gramley, and Seger. Absent and not banking organization in the relevant banking market, voting: Governor Martin. controlling 5.4 percent of the total deposits in commercial banks in the market. Company is the sixteenth JAMES MCAFEE largest commercial banking organization in the rele- [SEAL] Associate Secretary of the Board vant market, controlling 0.9 percent of the total deposits in commercial banks in the market. Upon consummation of this proposal, Applicant would become the Florida National Banks of Florida, Inc. sixth largest commercial banking organization in the Jacksonville, Florida market. Although consummation of this proposal would eliminate some existing competition in the Order Approving the Merger of Bank Holding relevant banking market, the Board believes that cer- Companies tain facts of record mitigate the anticompetitive effects of the transaction. Upon consummation, Applicant's Florida National Banks of Florida, Inc., Jacksonville, share of the total deposits in commercial banks in the Florida, a bank holding company within the meaning market would increase by only 0.9 percent to 6.3 of the Bank Holding Company Act (12 U.S.C. § 1841 percent, the Herfindahl-Hirschman Index ("HHI") et seq.) ("Act"), has applied for the Board's approval would increase by only 10 points to 946, and the under section 3(a)(5) of the Act (12 U.S.C. market would remain unconcentrated as measured by § 1842(a)(5)) to merge with Beacon Financial Corpora- this Index.4 In addition, 21 commercial banking altertion, Inc., Jupiter, Florida ("Company"). As a result natives would remain in the market after consummaof the transaction, Applicant would acquire Compa- tion of the transaction. Accordingly, the Board has ny's subsidiary bank, Lighthouse National Bank, Jupi- determined that consummation of this proposal would ter, Florida ("Bank").1 not have a significantly adverse effect on existing Notice of the application, affording an opportunity competition in the Eastern Palm Beach County bankfor interested persons to submit comments, has been ing market. given in accordance with section 3(b) of the Act. The The financial and managerial resources and future time for filing comments has expired, and the Board has considered the application and all comments re- 2. State banking data are as of December 31, 1983, and market data are as of June 30, 1983. 3. The Eastern Palm Beach County banking market is approximat- 1. Applicant and Company have committed to liquidate all of ed by all of Palm Beach County, Florida, excluding the towns of Belle Company's nonbanking subsidiaries prior to consummation of the Glade and Pahokee. proposed merger. 4. Under the United States Justice Department Merger Guidelines Applicant has also filed an application with the Comptroller of the (June 14, 1982), a market in which the post-merger HHI is below 1000 Currency under the Bank Merger Act to merge Bank into its lead is considered unconcentrated. The Department has indicated that it bank, Florida National Bank. will not challenge mergers in such markets. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 43 prospects of Applicant, Company and their subsidiar- Bank Holding Company Act of 1956, as amended ies are considered to be generally satisfactory and (12 U.S.C. § 1841 et seq.) ("Act"), has applied for the consistent with approval.5 Board's approval under section 3(a)(3) of the Act Upon consummation of this proposal, Company's (12 U.S.C. § 1842(a)(3)) to acquire Rhode Island Banexisting customers would have access to extensive corp, Inc., Hartford, Connecticut, and thus to acquire investment services, personal and corporate trust indirectly Rhode Island National Bank, Providence, services, and a statewide network of automatic teller Rhode Island ("Bank"), a proposed new bank. machines. Consequently, considerations relating to Notice of the application, affording opportunity for the convenience and needs of the community to be interested persons to submit comments, has been served are consistent with approval of the proposed given in accordance with section 3(b) of the Act. The merger. Accordingly, the Board has determined that time for filing comments has expired, and the Board consummation of the transaction would be consistent has considered the application and all comments rewith the public interest and that the application should ceived in light of the factors set forth in section 3(c) of be approved. the Act (12 U.S.C. § 1842(c)), including the comments On the basis of the record, this application is ap- of Citicorp, New York, New York, challenging the proved for the reasons summarized above. The merger constitutionality of the Rhode Island statute under shall not be consummated before the thirtieth calendar which the proposed acquisition is to be made.1 day following the effective date of this Order, or later Applicant, the second largest commercial banking than three months after the effective date of this organization in Connecticut with consolidated assets Order, unless such period is extended for good cause of $5.6 billion, has one banking subsidiary with total by the Board or by the Federal Reserve Bank of deposits of $3.3 billion, representing approximately 24 Atlanta, acting pursuant to delegated authority. percent of the total deposits in commercial banks in By order of the Board of Governors, effective Connecticut.2 Bank, which will compete in the Provi- November 13, 1984. dence banking market,3 is a proposed new bank. Applicant does not currently compete in the Providence banking market. In light of the de novo nature of Voting for this action: Chairman Volcker and Governors Martin, Partee, Rice, Gramley, and Seger. Absent and not this proposal, consummation of the proposed transacvoting: Governor Wallich. tion would have no adverse effects on competition or the concentration of banking resources in any relevant JAMES MCAFEE area. [SEAL] Associate Secretary of the Board The financial and managerial resources and future prospects of Applicant and Bank are consistent with Hartford National Corporation approval of the application. As a de novo institution, Hartford, Connecticut Bank will provide additional full service banking facili- Order Approving Acquisition of Bank Hartford National Corporation, Hartford, Connecticut, a bank holding company within the meaning of the 1. The Board received comments from Hartford Areas Rally Together, a coalition of neighborhood associations in Hartford, Connecticut. Those comments were subsequently withdrawn and the Board 5. In several recent cases, the Board has noted its concerns did not consider them in acting on the subject application. regarding the capital adequacy of bank holding company applicants 2. Banking data are as of June 30, 1984. These figures do not reflect seeking to expand through sizeable acquisitions involving a significant the acquisition of Arltru Bancorporation and its subsidiary bank, The level of intangible assets. E.g., National City Corporation, 70 FEDER- Arlington Trust Company, Lawrence, Massachusetts, approved by AL RESERVE BULLETIN 743 (1984). Applicant has a substantial amount the Board on March 26, 1984. At the time of approval, Arltru of intangible assets on its balance sheet and, if intangibles are Bancorporation had total assets of $819 million and total deposits of excluded, Applicant's tangible primary capital ratio meets the Board's $689 million, and it was the eighth largest bank holding company in current Capital Adequacy Guidelines, but is below the level contem- Massachusetts. Consummation of this acquisition has been stayed by plated under the proposed Guidelines. Capital Adequacy Guidelines, the United States Court of Appeals for the Second Circuit pending 12 C.F.R., Part 225, Appendix A. Capital Adequacy Guidelines for disposition by the United States Supreme Court of a petition for a writ Bank Holding Companies, 49 Federal Register 30,322 (July 30, 1984). of certiorari that raises the issue of the constitutionality of the Applicant's stated primary and total capital ratios, however, exceed Massachusetts and Connecticut interstate banking statutes. Northeast the minimum levels specified in the Board's current and proposed Bancorp, Inc. v. Board of Governors, 740 F.2d 203 (2d Cir. 1984), Capital Adequacy Guidelines, and Applicant has submitted a capital petition for cert, filed, 52 U.S.L.W. 3189 (U.S. Sept. 6, 1984). plan demonstrating its ability to increase its tangible primary capital 3. The Providence banking market includes all of Rhode Island, ratio to meet the Board's proposed Guidelines. Moreover, because of except for the southwestern portion of Washington County and the Company's relatively small size, the proposed acquisition would not eastern part of Newport County, and in addition includes Attleboro, result in any significant increase in Applicant's intangible assets or Blackstone, Millville, North Attleboro, Norton, Plainville, Rehoboth, significant decline in Applicant's capital ratios. and Seekonk, Massachusetts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

44 Federal Reserve Bulletin • January 1985 ties, and on this basis considerations relating to conve- Second Circuit issued an opinion rejecting the petitionnience and needs of the community to be served lend er's constitutional challenges to such regional interweight toward approval. state banking statutes and affirming the Board's Or- Section 3(d) of the Act prohibits the Board from ders.9 The constitutional issues involved in approving any application by a bank holding company Applicant's current application are the same as those to acquire any bank located outside the state in which involved in the Second Circuit decision. the operations of the bank holding company's banking Based on the foregoing and other facts of record, the subsidiaries are principally conducted, unless such Board has determined that the application should be acquisition is "specifically authorized by the statute and hereby is approved. The transaction shall not be laws of the State in which such bank is located, by consummated before the thirtieth day after the effeclanguage to that effect and not merely by implication." tive date of the Order, or later than three months after (12 U.S.C. § 1842(d)). Based upon its review of the the effective date of this Order, and the bank to be Rhode Island interstate banking statute,4 the Board acquired shall be opened for business not later than six concludes that Rhode Island has by statute expressly months after the effective date of this Order, unless authorized, within the meaning of section 3(d) of the such latter periods are extended for good cause by the Act, a Connecticut bank holding company, such as Board, or by the Federal Reserve Bank of Boston Applicant, to acquire a bank or bank holding company pursuant to delegated authority. in Rhode Island.5 By order of the Board of Governors, effective These applications raise questions under the United November 19, 1984. States Constitution concerning the constitutionality of provisions of the Rhode Island interstate banking Voting for this action: Chairman Volcker and Governors statute that bars bank holding companies located out- Martin, Wallich, Partee, Rice, Gramley, and Seger. side New England from acquiring banks in Rhode Island.6 The Board has addressed the constitutionality JAMES MCAFEE of the Rhode Island statute in its Order concerning a [SEAL] Associate Secretary of the Board previous interstate acquisition under that statute.7 The Board cited as dispositive of the constitutional issue the finding in its Bank of New England Corporation Kentucky Bancorporation, Inc. Order that, while the issue was not free from doubt, Covington, Kentucky there is no clear and unequivocal basis for a determination that a parallel Connecticut statute is inconsis- Order Approving Merger of Bank Holding tent with the Constitution.8 Companies Subsequent to the Board's approval of three prior applications under parallel Connecticut and Massa- Kentucky Bancorporation, Inc., Covington, Kenchusetts interstate banking laws, protestants in each tucky, a bank holding company within the meaning of case sought judicial review of the Board's Orders on the Bank Holding Company Act ("Act") (12 U.S.C. the sole ground that such regional interstate banking § 1841 et seq.), has applied for the Board's approval laws are unconstitutional. Following review of the under section 3(a)(5) of the Act (12 U.S.C. issues, the United States Court of Appeals for the § 1842(a)(5)) to merge with Northern Kentucky Bancshares, Inc., Covington, Kentucky (NKB), and thereby indirectly acquire The Falmouth Deposit Bank, Falmouth, Kentucky ("Falmouth Bank"); and with Kentucky National Corporation, Covington, Ken- 4. 1983 R. I. Pub. L. Ch. 201. tucky ("KNC"), and thereby indirectly acquire Ken- 5. The Board previously made such a finding with respect to the Rhode Island statute. See Bank of Boston Corporation, 70 FEDERAL tucky National Bank, Walton, Kentucky ("Walton RESERVE BULLETIN 737, 740 (1984). Bank") (collectively, "Banks"). 6. New England bank holding companies include those located in Notice of the application, affording opportunity for Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont. interested persons to submit comments, has been 7. Bank of Boston Corporation (RIHT Financial Corporation), 70 given in accordance with section 3(b) of the Act. The FEDERAL RESERVE BULLETIN 737, 740 (1984). time for filing comments has expired, and the Board 8. Bank of New England Corporation, 70 FEDERAL RESERVE BULLETIN 374, 376 (1984). It is the Board's policy that it will not hold has considered the application and all comments rea state law unconstitutional in the absence of clear and unequivocal evidence of the inconsistency of the state law with the United States Constitution. See NCNB Corp., 68 FEDERAL RESERVE BULLETIN 54, 56 (1982). The Board repeated these constitutional findings with respect to the Massachusetts statute in Hartford National Corporation, 70 FEDERAL RESERVE BULLETIN at 354. 9. Northeast Bancorp, Inc. v. Board of Governors, supra. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 45 ceived in light of the factors set forth in section 3(c) of total deposits in commercial banks in the market. In the Act (12 U.S.C. § 1842(c)). view of these facts and the small market shares Applicant, NKB, and KNC are each controlled by controlled by Covington Bank and Walton Bank, the the same shareholder, and thus this proposal repre- Board concludes that consummation of the proposal sents a reorganization of existing ownership interests. would not have any significant effect on competition in Applicant is the 31st largest commercial banking orga- the Cincinnati banking market. nization in Kentucky, controlling one bank, First Falmouth Bank operates in Pendleton County which National Bank and Trust Company of Covington, is outside of the Cincinnati banking market. Kentucky Covington, Kentucky ("Covington Bank"), with total law prohibits Falmouth Bank from branching into the deposits of $103.4 million, representing approximately Cincinnati banking market and Covington Bank and 0.5 percent of total deposits in commercial banks in Walton Bank from branching into Pendleton County.5 the state.1 NKB is the 251st largest commercial bank- In view of this and other facts of record, consummaing organization in Kentucky, controlling one bank tion of this proposal would have no significant effects with total deposits of $18 million, representing less on potential competition in any relevant market. Acthan 0.1 percent of the total deposits in commercial cordingly, the Board concludes that competitive conbanks in the state. KNC is the 263rd largest commer- siderations are consistent with approval of the applicacial banking organization in Kentucky, controlling one tion.6 bank with total deposits of $17 million, representing Upon consummation of this proposal, Applicant less than 0.1 percent of the total deposits in commer- would become a multibank holding company with cial banks in the state. Upon consummation of this consolidated assets of $161 million. Accordingly, the proposal, Applicant would become the 22nd largest Board has analyzed Applicant's financial resources commercial banking organization in Kentucky, con- under the Board's Capital Adequacy Guidelines, applitrolling three banks with total deposits of $138.4 cable to bank holding companies with more than $150 million, representing approximately 0.7 percent of million in assets.7 Based on the facts of record, the total deposits in commercial banks in the state. The financial and managerial resources of Applicant and Board concludes that consummation of this proposal Banks are consistent with approval and their prospects would not have a significant effect upon the concentra- appear favorable, especially in light of certain committion of banking resources in Kentucky. ments made by Applicant in connection with this Applicant and KNC both compete in the Cincinnati application. Applicant has proposed no new services banking market.2 Covington Bank operates in the for Banks. However, there is no evidence in the record Kenton County, Kentucky, portion of the Cincinnati indicating that the needs of the communities to be banking market and is the 11th largest of 39 commer- served are not being met. Accordingly, considerations cial banks in the market, controlling approximately 1.7 relating to the convenience and needs of the communipercent of total deposits in commercial banks in the ties to be served are consistent with approval. market.3 Walton Bank operates in the Boone County Based on the foregoing and all of the facts of record, portion of the Cincinnati banking market and is the the Board has determined that approval of this applica- 32nd largest commercial bank controlling approxi- tion is consistent with the public interest and that the mately 0.3 percent of total deposits in commercial application should be and hereby is approved. The banks in the market. Kentucky law prohibits Coving- acquisitions shall not be consummated before the ton Bank and Walton Bank from branching into the thirtieth calendar day following the effective date of portions of the market where the other is located.4 this Order, or later than three months after the effec- Upon consummation of this proposal, Applicant tive date of this Order, unless such period is extended would remain the 11th largest commercial banking for good cause by the Board or by the Federal Reserve organization controlling approximately 2 percent of Bank of Cleveland, pursuant to delegated authority. 1. All banking data are as of December 31, 1983, unless otherwise 5. Id. indicated. 6. Central Bancorporation, Cincinnati, Ohio, owns all of Appli- 2. The Cincinnati banking market is defined as all of Boone, cant's nonvoting common stock as well as 4.9 percent of Applicant's Kenton, and Campbell Counties, Kentucky; all of Hamilton (Cincin- voting common stock, representing 24.9 percent of Applicant's total nati) and Clermont Counties and portions of Warren and Butler equity. Central Bancorporation's ownership interest in Applicant Counties, Ohio; and Dearborn County, Indiana. would be diluted as a result of this proposal. In its decision approving 3. Competitive data for the Cincinnati banking market are as of Applicant's formation, the Board determined that Central Bancorpor- June 30, 1982. ation did not control Applicant by virtue of this investment. Kentucky 4. Under Kentucky banking law, a bank is prohibited from branch- Bancorporation, 69 FEDERAL RESERVE BULLETIN 863 (1983). ing outside of its home county. Ky. Rev. Stat. Ann. § 287.180(2). 7. Capital Adequacy Guidelines, 12 C.F.R. Part 225, Appendix A. 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46 Federal Reserve Bulletin • January 1985 By order of the Board of Governors, effective the third largest commercial banking organization in November 27, 1984. Maine, and would control 15.6 percent of the total deposits in commercial banks in the state. On the basis Voting for this action: Vice Chairman Martin and Gover- of all the facts of record, the Board concludes that nors Wallich, Partee, Rice, Gramley, and Seger. Absent and consummation of this proposal would not have a not voting: Chairman Volcker. significant adverse effect upon the concentration of banking resources in Maine. WILLIAM W. WILES Norstar and Banc of Maine Corporation compete in [SEAL] Secretary of the Board the Augusta banking market.2 Norstar is the smallest of six commercial banking organizations in the market. Norstar Bancorp Inc. It controls total deposits of $10.2 million, which repre- Albany, New York sents 3 percent of the deposits in commercial banks in the market.3 Banc of Maine Corporation is the third Northeast Bankshare Association largest commercial banking organization in the Augus- Portland, Maine ta market. It controls total deposits of $65.9 million, which represents 19.5 percent of the deposits in commercial banks in the market. Upon consummation of Order Approving Applications to Merge Bank the proposal, Norstar would become the third largest Holding Companies and Acquire a Bank commercial banking organization in the market and Norstar Bancorp Inc., Albany, New York, and North- have 22.5 percent of the total deposits in commercial east Bankshare Association, Portland, Maine, bank banks. holding companies within the meaning of the Bank Based on commercial bank deposits, the Augusta Holding Company Act ("Act"), 12 U.S.C. § 1841 market is highly concentrated. The three largest comet seq., have applied for the Board's approval under mercial banking organizations control 86.4 percent of sections 3(a)(3) and 3(a)(5) of the Act, 12 U.S.C. the market's deposits. The Herfindahl-Hirschman In- §§ 1842(a)(3) and 1842(a)(5), to acquire all of the dex ("HHI") is 2855 and would increase by 117 points outstanding shares of Banc of Maine Corporation, to 2972 upon consummation of this proposal.4 Al- Augusta, Maine, and thereby indirectly to acquire its though consummation of this proposal would eliminate subsidiary bank, Bank of Maine, N.A., Augusta, some existing competition between Norstar and Banc Maine, and simultaneously to merge Banc of Maine of Maine Corporation in the Augusta market, the Corporation into Northeast Bankshare Association. extent and nature of competition from thrift institu- Notice of the applications, affording an opportunity tions and other commercial banks significantly mitifor interested persons to submit comments, has been gate any anticompetitive effects of this merger.5 given in accordance with section 3(b) of the Act. The Seven thrift institutions control 53.9 percent of the time for filing comments has expired, and the Board total deposits in depository institutions in the Augusta has considered the applications and all comments market. The second and third largest depository instireceived in light of the factors set forth in section 3(c) tutions in the market are thrifts, and these institutions of the Act, 12 U.S.C. § 1842(c). control 16.4 percent and 11.9 percent, respectively, of Northeast Bankshare Association ("Northeast") is the total deposits in the market. All the thrift institua wholly owned subsidiary of Norstar. Northeast has one subsidiary bank, Northeast Bank, Portland, Maine. Norstar, through its ownership of Northeast, is 2. The Augusta banking market is defined to include Kennebec the fourth largest commercial banking organization in County, Maine, and the towns of Canaan, Fairfield, Freedom, Hubert's Gore, Jefferson, Palermo, Smithfield, Thorndike, Troy, and Maine. Northeast controls total deposits of $492 mil- Unity, all in Maine. lion, which represents 13.6 percent of the total depos- 3. As of June 30, 1983. its in commercial banks in Maine.1 Banc of Maine 4. Under the revised Justice Department Merger Guidelines (June 14, 1984), a market in which the post-merger HHI is above 1800 Corporation is the eighth largest commercial banking is considered highly concentrated. In such a market, the Justice organization in Maine. It controls total deposits of $73 Department is likely to challenge mergers that produce an increase in million, which represents 2.0 percent of the total the HHI of more than 50 points, unless the Justice Department concludes after considering a number of mitigating factors that the deposits in commercial banks in Maine. Upon con- merger is not likely substantially to lessen competition. summation of this proposal, Norstar would become 5. The Board has previously determined that thrift institutions have become, or at least have the potential to become, major competitors of banks. E.g., First National Bankshares of Sheridan, 70 FEDERAL RESERVE BULLETIN 832 (Board Order dated September 28, 1984); Midlantic Banks, Inc., 70 FEDERAL RESERVE BULLETIN 776 (1984); Commercial Landmark Corporation, 70 FEDERAL RESERVE BULLE- 1. As of June 30, 1984. TIN 651 (1984). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 47 tions in the Augusta market are active competitors for Based on the foregoing and all of the facts of the consumer accounts of commercial banks by their record,8 the Board has determined that these applicaprovision of NOW accounts, and residential real estate tions should be and hereby are approved. The acquisiand consumer loans. In addition, several of the largest tion shall not be consummated before the thirtieth thrifts have made significant progress in exercising calendar day following the effective date of this Order, their commercial real estate and expanded commercial or later than three months after the effective date of and industrial loan powers. this Order, unless such period is extended for good After consideration of the extent and nature of cause by the Board or by the Federal Reserve Bank of competition from several Augusta thrifts for the full New York, pursuant to delegated authority. array of banking services, the Board concludes that By order of the Board of Governors, effective their activity in consumer and commercial services November 26, 1984. substantially mitigates the anticompetitive effects of this proposal.6 Accordingly, the Board concludes that Voting for this action: Vice Chairman Martin and Goverconsummation of this proposal would not have a nors Wallich, Partee, Rice, Gramley, and Seger. Absent and significant adverse effect upon existing competition in not voting: Chairman Volcker. the Augusta market, or in any other relevant market. JAMES MCAFEE The Board also has considered the effect of this [SEAL] Associate Secretary of the Board proposal upon probable future competition in light of its proposed guidelines for assessing the competitive effects of market extension mergers and acquisitions.7 Sheridan Bancshares, Inc. Because of the number of potential entrants, the Tulsa, Oklahoma proposed transaction would not require extensive analysis under the Board's proposed guidelines, and Order Approving Acquisition of a Bank the Board concludes that consummation of this proposal would not have any significant adverse effects on Sheridan Bancshares, Inc., Tulsa, Oklahoma, has approbable future competition in any relevant market. plied for the Board's approval under section 3(a)(1) of The financial and managerial resources and future the Bank Holding Company Act ("Act") (12 U.S.C. prospects of Norstar, Banc of Maine Corporation, and § 1842(a)(1)) to become a bank holding company by their subsidiaries are satisfactory and consistent with acquiring all of the voting shares of Sunbelt Bank and approval of these applications. Considerations relating Trust Company, Tulsa, Oklahoma ("Bank"). This to the convenience and needs of the communities to be application is designed to effect a transfer of control of served are also consistent with approval of these Bank from its current shareholder to a group of applications. Consummation will provide the commu- individual investors. nities presently served by Banc of Maine Corporation The Oklahoma State Department of Banking has with expanded services in the areas of commercial and requested the Board to take expeditious action on the consumer lending, trust services, and checking and application in accordance with the provisions of secsavings accounts. tion 3(b) of the Act (12 U.S.C. § 1842(b)). Notice of the application, affording interested persons opportunity to submit comments, has been given in accordance with the provisions of section 3(b) of the Act for applications requiring expeditious action. The time for filing comments has expired and the Board has consid- 6. If 50 percent of the deposits held by thrift institutions are included in the competitive analysis, Norstar would control 1.9 ered the application and all comments received, in percent of the deposits in depository institutions in the Augusta light of the factors set forth in section 3(c) of the Act market, and Banc of Maine Corporation would control 12.3 percent of (12 U.S.C. § 1842(c)). the market's deposits. Upon consummation, Norstar would control 14.2 percent of the deposits in depository institutions in the market. Applicant, a nonoperating company with no subsid- The Augusta market would only be moderately concentrated with a iaries, was organized for the purpose of becoming a three-firm concentration ratio of 54.4 percent, and the HHI would increase by 47 points to 1445. Under the revised Justice Department bank holding company by acquiring Bank. Bank, with Guidelines, the Justice Department is unlikely to challenge a merger deposits of $103.1 million, is the 39th largest bank in producing an increase in the HHI of less than 100 points in a market in which the post-merger HHI is between 1000 and 1800. 7. "Proposed Policy Statement of the Board of Governors of the Federal Reserve System for Assessing Competitive Factors Under the Bank Merger Act and the Bank Holding Company Act," 47 Federal Register 9017 (March 3, 1982). Although the proposed policy state- 8. The Board has found that for purposes of section 3(d) of the Act, ment has not been approved by the Board, the Board is using the the statute laws of Maine specifically authorize an out-of-state bank policy guidelines as part of its analysis of the effect of a proposal on holding company to acquire a bank in Maine. Bank of Boston probable future competition. Corporation, 70 FEDERAL RESERVE BULLETIN 219 (1984). 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48 Federal Reserve Bulletin • January 1985 Oklahoma, holding 0.4 percent of the total deposits of United Virginia Bankshares Incorporated commercial banks in the state.1 Bank operates in the Richmond, Virginia Tulsa, Oklahoma banking market,2 where it is the eighth largest of 58 commercial banks, controlling 1.83 Order Approving Acquisition of Shares of a percent of the total deposits in commercial banks. Bank Holding Company None of Applicant's principals are principals of any other financial organization located within the relevant United Virginia Bankshares Incorporated, Richmond, market. Accordingly, consummation of this proposal Virginia, a bank holding company within the meaning would not result in any significant adverse effects on of the Bank Holding Company Act of 1956, as amendcompetition or increase in concentration of resources ed (12 U.S.C. § 1841 et seq.) ("Act"), has applied for in any relevant area. Therefore, the Board concludes the Board's approval pursuant to section 3(a)(3) of the that competitive considerations are consistent with Act (12 U.S.C. § 1842(a)(3)) to retain certain voting approval. shares and debentures convertible into voting shares1 In connection with the application, the Board has and to acquire an additional 18.1 percent of the voting taken into consideration the financial and managerial shares and additional debentures convertible into votresources and future prospects of Applicant and Bank ing shares of Citizens Trust Company, Portsmouth, and the convenience and needs of the community to be Virginia ("Company"), and indirectly of Citizens served. In this regard, the Board notes that this Trust Bank, Portsmouth, Virginia ("Bank").2 Followproposal is designed to strengthen and restore public ing acquisition and conversion, Applicant would conconfidence in Bank and thereby to maintain Bank's trol a total of 25.4 percent of Company's voting shares. service to the convenience and needs of the communi- Notice of the application, affording interested perty. On this basis and in view of certain commitments sons an opportunity to submit comments, has been made by Applicant, the Board has determined that given in accordance with section 3(b) of the Act. The consummation of the transaction would be in the time for filing comments has expired, and the Board public interest, and that the application should be and has considered the application and all comments rehereby is approved.3 ceived in light of the factors set forth in section 3(c) of The transaction shall not be consummated before the Act (12 U.S.C. § 1842(c)). the fifth calendar day following the effective date of Applicant, the second largest commercial banking this Order or later than three months after the effective organization in Virginia, controls one subsidiary bank date of this Order, unless such period is extended for with total deposits of $4.1 billion, representing 15.1 good cause by the Board or by the Federal Reserve percent of the total deposits in commercial banks in Bank of Kansas City, acting pursuant to delegated the state.3 Company, the thirteenth largest commercial authority. banking organization in Virginia, holds deposits of By order of the Board of Governors, effective $123.5 million, representing approximately 0.5 percent November 6, 1984. of the deposits in commercial banks in the state. Upon acquisition of Company, Applicant would remain Vir- Voting for this action: Chairman Volcker and Governors ginia's second largest commercial banking organiza- Martin, Partee, Rice, Gramley, and Seger. Absent and not tion and would control approximately 15.5 percent of voting: Governor Wallich. the total deposits in commercial banks in the state. Consummation of this proposal would not have a JAMES MCAFEE [SEAL] Associate Secretary of the Board significantly adverse effect on the concentration of commercial banking resources in Virginia. 1. Banking data are as of December 31, 1983. 2. The Tulsa banking market is defined as the Tulsa Ranally Metro Area. 3. In making this judgment, the Board has considered the comments submitted by the Creditors Committee for the Republic Finan- 1. Applicant currently holds 5 percent of the voting shares of cial Corporation protesting the application and requesting a hearing. Company and $241,000 principal amount of Bank's debentures, which The Board's Rules of Procedure require that requests for a hearing are convertible into Company's voting shares. If the debentures were must include a statement of why a written presentation would not converted, Applicant's present holdings would equal 6.7 percent of suffice in lieu of a hearing and specifically identify any questions of Company's shares. fact that are in dispute and summarize the evidence that would be 2. The proposal to acquire additional shares will only be consumpresented at a hearing. 12 C.F.R. 262.3(e). Protestant has not present- mated if Bank of Virginia Company, Richmond, Virginia ("BVC"), ed any facts indicating the nature of its objection to the application or does not exercise an option, assigned to it by Applicant, to purchase summarized any evidence that would be presented at a hearing, the 18.1 percent of voting shares and the additional debentures despite requests that it do so. Accordingly, the Board has determined convertible into voting shares of Company. In the event BVC does not that Protestant's comments do not warrant denial of the application or consummate its proposed acquisition by December 24, 1984, Appliprovide a basis for a hearing. Protestant's request for a hearing is cant may repurchase the option. therefore denied. 3. Statewide banking data are as of December 31, 1983. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 49 Applicant and Company compete in the Norfolk- The financial and managerial resources and future Portsmouth banking market,4 where all of Bank's prospects of Applicant, Company, and Bank are satisoffices are located. Applicant is the second largest factory and consistent with approval of this applicacommercial banking organization in the Norfolk-Ports- tion. Considerations relating to the convenience and mouth banking market, controlling 17.8 percent of the needs of the communities to be served also are consisdeposits in commercial banks in the market.5 Bank is tent with approval. Based on these and other facts of the seventh largest banking organization in the market record, it is the Board's judgment that consummation and controls 4.2 percent of the deposits in commercial of the proposed transaction would be in the public banks in the market. Upon consummation of the interest and that the application should be approved. proposed transaction, Applicant would remain the On the basis of the record, the application is apsecond largest banking organization in the Norfolk- proved for the reasons summarized above. The trans- Portsmouth market and would control 22 percent of action shall not be consummated before the thirtieth the deposits in commercial banks in the market. calendar day following the effective date of this Order The share of deposits held by the four largest or later than three months after the effective date of banking organizations in the Norfolk-Portsmouth this Order, unless such period is extended for good banking market is 71.2 percent, and the market's cause by the Board, or by the Federal Reserve Bank of Herfindahl-Hirschman Index ("HHI") is 1875. Upon Richmond pursuant to delegated authority. consummation of this proposal, the four-firm concen- By order of the Board of Governors, effective tration ratio would increase to 75.4 percent and the November 21, 1984. HHI would increase 149 points to 2024.6 While the proposed acquisition would eliminate existing compe- Voting for this action: Chairman Volcker and Governors tition in the Norfolk-Portsmouth market, the Board Martin, Wallich, Partee, Rice, Gramley, and Seger. believes that the anticompetitive effects of this proposal are mitigated by the extent to which thrift institu- JAMES MCAFEE tions compete with commercial banks in the market.7 [SEAL] Associate Secretary of the Board The 14 thrift institutions that compete in the market hold total deposits of $1.9 billion, representing approximately 41 percent of the total deposits in commercial Wesbanco, Inc. banks and thrift institutions in the market. Four of the Wheeling, West Virginia market's six largest depository institutions are thrift institutions. The thrift institutions in the market offer Order Approving Acquisition of a Bank NOW accounts and are active in consumer lending. Moreover, four of the market's thrift institutions offer Wesbanco, Inc., Wheeling, West Virginia, a bank commercial lending services and commercial transac- holding company within the meaning of the Bank tion accounts. Based upon this and other evidence of Holding Company Act ("Act") (12 U.S.C. § 1841 record, the Board has concluded that the competition et seq.), has applied for the Board's approval under offered by thrift institutions in the Norfolk-Portsmouth section 3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to market mitigates the anticompetitive effects of this acquire all of the voting shares of First-Tyler Bank & proposal and has determined that consummation of the Trust Company, Sisterville, West Virginia ("Bank"). proposal would not have a significant adverse effect on Notice of the application, affording an opportunity existing competition in the market.8 for interested persons to submit comments, has been given in accordance with section 3(b) of the Act. The time for filing comments has expired, and the Board has considered the application and all comments received in light of the factors set forth in section 3(c) of 4. The Norfolk-Portsmouth banking market is defined as the Northe Act (12 U.S.C. § 1842(c)). folk-Portsmouth Ranally Metro Area. 5. Market data are as of June 30, 1984. 6. Under the Department of Justice Merger Guidelines, a market in which the post-merger HHI is above 1800 is considered highly concentrated. In such a market, the Department is likely to challenge a merger that produces an increase in the HHI of 100 points or more. 7. The Board has previously determined that thrift institutions have merger market share would be 16.3 percent, making it the second become, or at least have the potential to become, major competitors of largest depository institution in the market. Furthermore, when thrift banks. NCNB Corporation, 70 FEDERAL RESERVE BULLETIN 225 data are considered, consummation of the proposal would increase the (1984); Sun Banks, Inc., 69 FEDERAL RESERVE BULLETIN 934 (1983); market's four-firm concentration ratio to 56.3 percent and would Merchants Bancorp, Inc., 69 FEDERAL RESERVE BULLETIN 865 increase the HHI 82 points from 1141 to 1223. The Justice Department (1983); First Tennessee National Corporation, 69 FEDERAL RESERVE has stated that where a post-merger market HHI is between 1000 and BULLETIN 298 (1983). 1800 and the merger produces an increase of less than 100 points, the 8. If 50 percent of the deposits held by thrift institutions were Department is unlikely to challenge such a merger. In this case, the included in the calculation of market concentration, Applicant's post- increase would be less than 100 points. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

50 Federal Reserve Bulletin • January 1985 Applicant is the seventh largest banking organiza- hold total deposits of $73 million, representing 35.3 tion in West Virginia, controlling three banks with percent of total deposits in commercial banks and total deposits of $193.9 million, representing approxi- savings and loan associations in the market.4 The thrift mately 2 percent of total deposits in commercial banks institutions are aggressive competitors, particularly in the state.1 Bank is the 195th largest banking organi- for retail services, that have experienced more rapid zation with total deposits of $10.6 million, representing deposit growth than commercial banks in the market approximately 0.1 percent of total deposits in commer- over the last four years. The thrift institutions offer a cial banks in the state. Upon consummation Applicant full range of transaction accounts (including NOW would control total deposits of $204.5 million, repre- accounts) and offer consumer lending services. Moresenting approximately 2.1 percent of total deposits in over, these thrifts were found to have a significant commercial banks in the state, and Applicant's rank competitive influence on commercial lending in this within the state would remain unchanged. Consumma- market. In view of these facts, the Board has considtion of this proposal would not result in the concentra- ered the presence of thrift institutions a significant tion of banking resources in West Virginia. factor in assessing the competitive effects of this Applicant and Bank both operate in the Tyler- proposal. The Board has also considered that Bank's Wetzel County banking market.2 Applicant is the third deposit market share has been steadily declining over largest of seven commercial banking organizations in the past eleven years and its loan-to-deposit ratio is the the market, controlling total deposits of $22.8 million, lowest of any financial institution in the market. Alrepresenting 17.1 percent of total deposits in commer- though acquisition of Bank by Applicant would elimicial banks. Bank, with deposits of $10.6 million, is the nate Bank as an independent competitor, the Board sixth largest commercial banking organization in the has determined that, in view of Bank's declining market controlling 7.9 percent of total deposits in market share, its small size, and its low loan-to-deposit commercial banks. Upon consummation of this pro- ratio, Bank has been a decreasingly effective competiposal, Applicant would become the second largest tor and consummation of the proposal would not have commercial banking organization in the market con- a significant adverse effect on existing competition in trolling total deposits of $33.4 million, representing 25 the relevant banking market.5 percent of the total deposits in commercial banks. The financial and managerial resources of Appli- The Tyler-Wetzel County banking market is consid- cant, its subsidiary banks, and Bank are satisfactory ered to be moderately concentrated with a four-firm and their future prospects appear favorable. Applicant concentration ratio of 76 percent and a Herfindahl- plans to offer new services to Bank's customers, Hirschman Index ("HHI") of 1701. Upon consumma- including unsecured commercial loans, Small Business tion of this proposal, the four-firm concentration ratio Administration loans, home improvement loans, and would increase to 83.9 percent and the HHI would expand Bank's range of CD's and offer both fixed and increase by 270 points to 1971. These market shares variable rate CDs for IRAs. Applicant also proposes to and concentration measures, however, substantially have Bank join an ATM network and plans to offer overstate the competitive effects of this merger. While credit card, trust, and discount brokerage services consummation of this proposal would eliminate exist- from its lead bank through Bank. Accordingly, considing competition between Applicant and Bank, the erations relating to the convenience and needs of the Board has concluded that the anticompetitive effects communities to be served lend substantial weight of this proposal are mitigated by the extent and nature toward approval of this proposal and outweigh any of competition provided by the thrift institutions in the adverse competitive effects of this proposal. Tyler-Wetzel market3 and by Bank's diminishing ef- Based on the foregoing and other facts of record, the fectiveness as a competitor in the market. Board has determined that approval of the application Three thrift institutions rank as the first, sixth and tenth largest depository institutions in the market and (1984); NCNB Corporation, 70 FEDERAL RESERVE BULLETIN 225 (1984); First Tennessee National Corporation, 69 FEDERAL RESERVE BULLETIN 298 (1983). 4. Savings and loan data are as of December 31, 1983. 1. All banking data are as of December 31, 1983, except for 5. If 50 percent of the deposits held by thrift institutions were Applicant's consolidated deposits which are as of September 30, 1983. included in the calculation of market concentration, the pre-acquisi- 2. The Tyler-Wetzel County banking market is defined as Tyler and tion four-firm concentration ratio would decrease to 63 percent and Wetzel Counties, West Virginia. the HHI would decrease to 1295. Upon consummation of this propos- 3. The Board has previously determined that thrift institutions have al, the four-firm concentration ratio would increase to 69.2 percent become, or at least have the potential to become, major competitors of and the HHI would increase by 166 points to 1461. The resulting banks. FirstIlliniBancorp, Inc., 70 FEDERAL RESERVE BULLETIN 879 market share of Applicant would decrease to 19.6 percent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 51 would be consistent with the public interest and that the proposal, in light of the factors set forth in section the application should be and hereby is approved. The 4(c)(8) of the BHC Act (12 U.S.C. § 1843(c)(8)). transaction shall not be consummated before the thirti- Applicant is the sixth largest commercial banking eth calendar day following the effective date of this organization in New York, with total consolidated Order, or later than three months after the effective assets of $40 billion.1 Applicant operates two subsiddate of this Order, unless such period is extended for iary banks with total deposits of approximately $24.4 good cause by the Board or the Federal Reserve Bank billion. of Cleveland, acting pursuant to delegated authority. Trust Company was established in 1981 as a nation- By order of the Board of Governors, effective ally chartered nondepository trust company. Trust November 28, 1984. Company currently engages in providing fiduciary, investment advisory, agency and custodial services Voting for this action: Vice Chairman Martin and Gover- from a single office in Palm Beach. Applicant proposes nors Wallich, Partee, Rice, Gramley, and Seger. Absent and to expand Trust Company's powers under its national not voting: Chairman Volcker. bank charter to offer the services of a national bank, including acceptance of time and demand deposits and WILLIAM W. WILES the making of loans to individuals for personal, family, [SEAL] Secretary of the Board household, or charitable purposes. Applicant has, however, stated that Trust Company will not make commercial loans as that term is defined in the Board's Regulation Y, 12 C.F.R. § 225.2(a)(1)(B).2 On this Orders Issued Under Section 4 of Bank Holding basis, Applicant asserts that Trust Company would Company Act not be a "bank" under the BHC Act, and that this application therefore is properly filed under section Bankers Trust New York Corporation 4(c)(8) of that Act. Protestants, in contrast, assert that New York, New York Trust Company would be a bank because its demanddeposit taking activities should be combined with the Order Approving Expansion of Activities of Trust commercial lending activities of other subsidiaries of Company to Include Offering Checking Accounts Applicant. and Consumer Lending In its decision earlier this year in U.S. Trust Corpo- Bankers Trust New York Corporation, New York, ration, the Board was constrained by the technical New York, a bank holding company within the mean- definition of "bank" in the Act to conclude that a bank ing of the Bank Holding Company Act (12 U.S.C. holding company could acquire, on an interstate basis, § 1841 et seq.) ("BHC Act"), has applied for approval a national bank that stated it would accept demand under section 4(c)(8) of the Act (12 U.S.C. deposits but not make commercial loans. The Board, § 1843(c)(8)) and section 225.23(a)(1) of the Board's however, imposed the following conditions to prevent Regulation Y (12 C.F.R. § 225.23(a)(1)) to expand the the linkage or integration of the applicant's activities with the proposed nonbank bank, as well as transacactivities of its subsidiary, Bankers Trust Company of tions between the nonbank bank and its holding com- Florida, N.A., Palm Beach, Florida ("Trust Compapany affiliates, in order to limit, to the extent possible, ny"), to include the acceptance of time and demand the potential for undermining the policies of the Act: deposit accounts, including checking accounts, and 1. Applicant will not operate the demand-deposit the making of consumer loans. These activities have taking activities of the nonbank bank in tandem with been previously determined by the Board to be closely any other subsidiary or other financial institution; related to banking. 12 C.F.R. § 225.25(b)(1); U.S. Trust Corporation, 70 FEDERAL RESERVE BULLETIN 371 (1984); Citizens Fidelity Corporation, 69 FEDERAL RESERVE BULLETIN 556 (1983); First Bancorporation, 68 FEDERAL RESERVE BULLETIN 253 (1982). Notice of the application, affording opportunity for interested persons to comment, has been duly pub- 1. Financial data are as of December 31, 1983. lished (49 Federal Register 17,091 (April 23, 1984)). 2. The Board's definition of "commercial loan" contained in The time for filing comments and views has expired Regulation Y is the subject of ongoing litigation. The U.S. Court of Appeals for the Tenth Circuit in Dimension Financial Corporation v. and the Board has considered the application and all Board of Governors, No. 83-2696, slip op. (10th Cir. Sept. 24, 1984), comments received, including those submitted by the set aside the Board's definition of commercial loans. The mandate has not yet issued in that case, and the Board plans to ask the Department Comptroller of the State of Florida and the Florida of Justice to file a petition for a writ of certiorari with the Supreme Bankers Association ("Protestants") in opposition to Court. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

52 Federal Reserve Bulletin • January 1985 2. Applicant will not link in any way the demand tion. Indeed, consummation of the proposal may readeposit and commercial lending services that define sonably be expected to result in increased competia bank under the Act; and tion. 3. The nonbank bank will not engage in any transactions with affiliates, other than the payment Protestants' Hearing Request of dividends to Applicant or the infusion of capital by Applicant into the bank, without the Board's Protestants have requested a formal hearing on the approval. issue of whether Applicant will operate its commercial These conditions preclude the type of integrated lending subsidiaries in an integrated fashion with Trust operation that could otherwise render Trust Company Company, and thus whether Trust Company or Applia bank for purposes of the Act. Applicant has stated in cant itself can be viewed as a "bank" within the its application that it will comply with each of these technical definition of that term contained in the BHC conditions. On the basis of Applicant's adherence to Act.4 Protestants list several areas of inquiry to be these conditions and for the reasons set out more fully undertaken by the Board at such a hearing. in the Board's decision in U.S. Trust, the Board is First, Protestants argue that a hearing is required to constrained, as it was in U.S. Trust, to conclude that determine whether Applicant's commercial lending Trust Company will not be a bank as that term is subsidiaries solicit commercial loans from Floridadefined in the BHC Act and that Applicant's proposal based customers. In the course of its consideration of is properly filed under section 4 of the BHC Act. this application, the Board determined that Appli- Accordingly, the Board does not find Protestants' cant's subsidiary bank in New York has $230 million in contention concerning the linkage of Applicant's com- commercial loans outstanding to Florida customers. mercial lending activities and Trust Company's de- The existence of such loans, however, do not necesmand deposit activities persuasive.3 sarily result in a linkage of demand deposit and com- Applicant's proposal differs from the facts presented mercial lending services in the absence of evidence of in U.S. Trust in one respect: U.S. Trust Corporation integrated operations between Trust Company and had no commercial lending subsidiaries located in Applicant or any of its affiliates. It is undisputed that Florida, whereas Applicant has an Edge Act subsid- Applicant has no commercial lending subsidiary in iary in Florida that engages in commercial lending. close proximity to Trust Company, and the Board has The conditions imposed by the Board in U.S. Trust, imposed conditions on the operations of Trust Compaand relied on here, however, prohibit any integration ny to prohibit integrated operations with Applicant or of the operations of Trust Company and this Edge Act any of its subsidiaries. As noted, Applicant has stated subsidiary, or any other subsidiary of Applicant, and in its application that it will strictly adhere to these thus, in almost all circumstances, obviate concerns conditions. Protestants have offered no evidence that about integrated operations arising from geographic Applicant will not comply with the conditions imposed location. While circumstances could arise, for exam- by the Board, conditions which the Board has specific ple in the case of location of affiliate operations in the authority to enforce under the BHC Act and the same building or otherwise in close physical proximi- Financial Institutions Supervisory Act of 1966. ty, that might result in a different conclusion, such a Protestants also claim that a hearing is required to situation does not exist in this case. probe Applicant's "history of integrating the activities There is no evidence in the record of integrated of its subsidiaries" as well as an alleged pattern of operations between Trust Company and any office or integrated operations between Applicant's finance affiliate of Applicant engaged in commercial lending. company subsidiary and the activities of Applicant's The Board also finds no evidence that consummation commercial bank subsidiaries to show that the dynamof this proposal would result in any conflicts of inter- ics of "corporate socialization" preclude the indepenest, unfair competition, unsound banking practices or dent operation of Trust Company. Protestants offer no other adverse effects. Due to the de novo nature of this facts to support their contentions of a history of proposal, there will not be any decrease in competi- integrated operations or "corporate socialization." Bare allegations are insufficient to warrant a hearing. 3. In its U.S. Trust Order, the Board also concluded that consum- 4. The Board addressed a similar issue in its U.S. Trust Order, 70 mation of that proposal was not barred by any valid provision of FEDERAL RESERVE BULLETIN 371, 373 (1984). The Board continues to Florida law. For the reasons set out in that decision, the Board believe that protestants are raising a legal issue dealing with the continues to adhere to its conclusion in that case regarding the technical definition of the term "bank" in the BHC Act that is not an constitutionality of the Florida statute upon which Protestants rely. appropriate issue for a formal hearing. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 53 Moreover, any history of operations of other subsid- banks. The continued acquisition of nonbank banks by iaries of Applicant would be largely immaterial since securities, insurance, and other nonbanking organizathese subsidiaries do not operate under the specific tions presents the potential for a significant, haphazconditions imposed by the Board in this Order to ard, and possibly dangerous alteration of the banking prevent integrated operations. structure, without Congressional action on the under- The type of information Protestants request the lying policy issues. Board to compel Applicant to supply in the course of a If the nonbank bank concept, particularly as exhearing has been obtained by the Board, including the panded by the interpretation of demand deposits and nature of offices maintained by Applicant in Florida, commercial loans adopted by the Tenth Circuit, bethe extent of commercial lending by the Florida offices comes broadly generalized, a bank holding company of Applicant's subsidiaries and the commercial lending or commercial or industrial company, through exploito Florida customers by Applicant's commercial bank tation of an unintended loophole, could operate subsidiaries located outside of Florida. The Board "banks" that offer NOW accounts and make commerfinds the other materials sought, such as leasing and cial loans in every state, thus defeating Congressional factoring activities in Florida by Applicant's subsidiar- policies on commingling of banking and commerce, ies, to be immaterial in view of the conditions imposed conflicts of interest, concentration of resources and by the Board, which would prevent any integration of excessive risk, or with respect to limitations on intersuch activities with the operations of Trust Company. state banking. With the lifting of the moratorium on The request for a hearing must be based upon a the chartering of nonbank banks by the Comptroller of showing that there are material facts truly disputed. the Currency, action by the Congress is imperative to Connecticut Bankers Association v. Board of Gover- ensure that the policies of the BHC Act are mainnors, 627 F.2d 245 (D.C. Cir. 1980). The Board finds tained. no such material facts at issue and, accordingly, denies The fact that the Board is required by the technical the request of Protestants for a hearing. aspects of the bank definition in the Act to approve this and similar applications today should not be Need for Congressional Action construed as encouragement to the applicants to consummate these proposals or to others to pursue similar In its U.S. Trust Corporation Order, the Board ad- acquisitions. In this regard, the Board notes that dressed the critical need for legislation to apply the legislation passed by the United States Senate and the policies of the BHC Act to companies that control House Banking Committee would clarify the definition institutions that are chartered as banks and that offer of the term "bank" in the BHC Act to include all transaction accounts to the public. Since the Board's FDIC-insured banks. Enactment of this legislation U.S. Trust decision, 55 bank holding companies have would preclude acquisition of so-called nonbank banks applied to the Comptroller for approximately 330 by bank holding companies on an interstate basis, such national nonbank bank charters and a number of large as proposed in this case, and by nonbanking concerns, nonbanking companies, including retail, securities and and would require divestiture of any nonbank bank insurance concerns, have acquired, or announced acquired after June 30, 1983. The Chairmen of the two their intentions to acquire, nonbank banks. The ap- Congressional banking committees have announced proval of this application and the others approved that they intend to address this nonbank bank issue in today underscore the critical need for Congress to take the next session of Congress, and that the grandfather final action on legislation to close the so-called non- date in the legislation for nonbank banks will not be bank bank loophole. altered. The Board wishes to call to the Applicant's The recent decisions of the United States Court of attention that in the event this legislation is enacted, Appeals for the Tenth Circuit reversing the Board's Applicant would be required to divest Trust Company interpretation of NOW accounts as demand deposits or otherwise limit Trust Company's activities to comand the Board's definition of "commercial loans" for ply with the legislation, and Applicant could suffer purposes of the BHC Act5 serve to make nonbank financial loss as a result. banks a more attractive acquisition target by making Based upon the foregoing and all the facts of record, them even more clearly like traditional commercial the Board has determined that the balance of public interest factors it is required to consider under section 4(c)(8) is favorable. Accordingly, the application is hereby approved. If this proposal is consummated, it shall be subject to the conditions set forth in this order 5. First Bancorporation v. Board of Governors, 728 F.2d 434 (10th with respect to avoiding operation of an integrated Cir. 1984), and Dimension Financial Corporation v. Board of Gover- institution and the conditions set forth in the Board's nors, No. 83-2696, slip op. (10th Cir. September 24, 1984). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

54 Federal Reserve Bulletin • January 1985 Regulation Y, including those in sections 225.4(d) and as this would be the first time that the Board will have 225.23(b). The approval is also subject to the Board's sanctioned the acquisition of a bank by a firm engaged authority to require modification or termination of the in activities that are impermissible for bank holding activities of the holding company or any of its subsid- companies under the Bank Holding Company Act. iaries as the Board finds necessary to assure compli- The Senate recently passed by an overwhelming ance with the provisions and purposes of the Act and majority a bill that would close the so-called nonbank the Board's regulations and orders issued thereunder, bank loophole by redefining the term "bank" in the or to prevent evasion thereof. In accordance with the Act. The House Banking Committee approved a bill provisions of section 225.23(b)( 1 )(iii) of Regulation Y, with a similar redefinition of the bank definition, but the Board's approval would be required for additional the full House failed to vote on the bill before the acquisitions by Applicant of nonbank banks or for the Congress adjourned. In view of this indication of establishment of offices of Trust Company to be Congressional intent to reaffirm the basic policies of located in a state other than Florida. the Act, I believe that the Board should exercise its By order of the Board of Governors, effective broad powers under the Act to deny this application November 1, 1984. and other similar proposals. Such applications present serious adverse effects which are not outweighed by Voting for this action: Chairman Volcker and Governors any compelling public benefits, particularly in the Partee, Gramley, and Seger. Voting against this action: context of the number of similar applications pending Governors Wallich and Rice. Absent and not voting: Gover- and the effect that approval of such a number of nor Martin. applications would have on the Act's fundamental policies. JAMES MCAFEE [SEAL] Associate Secretary of the Board November 1, 1984 Dissenting Statement of Governor Rice Dissenting Statement of Governor Wallich For the reasons stated in my dissents to the Board's I concur with the views of Governor Rice and would Orders approving the applications by Citizens Fidelity deny this application. Corporation and U.S. Trust Corporation to acquire so- I voted to approve the U.S. Trust proposal in the called nonbank banks (69 FEDERAL RESERVE BULLE- belief that approval, subject to the conditions imposed TIN 556 (1983); 70 FEDERAL RESERVE BULLETIN 371 by the Board, would not lead to a serious evasion of (1984)), I would deny this application. Approval of this the Bank Holding Company Act, particularly in view application and the others approved today by the of my belief that Congressional action was imminent to Board, in my view, further erodes the purposes of the clarify the definition of "bank" in the Act and so to Bank Holding Company Act to prevent interstate mitigate my concern that the nonbank bank device banking without express state authorization and might be used to undermine the basic concepts and threatens to seriously undermine the Congressional purposes of the Act. Following the U.S. Trust decipolicy to separate banking and commerce. sion, however, virtually all of the nation's largest bank Following the Board's U.S. Trust decision, numer- holding companies have filed applications for hunous bank holding companies have applied to acquire dreds of nonbank banks to be located nationwide. In hundreds of nonbank banks throughout the country addition, a number of nonbanking companies, includand a number of large nonbanking companies have ing the nation's largest retail, insurance, and securities indicated their plans to acquire such banks. The firms, have announced their intentions to acquire Board's action today reaffirming its U.S. Trust deci- nonbank banks, as Congress adjourned without taking sion establishes a further precedent for the multitude action on these issues. of pending nonbank bank applications. Approval of Nevertheless, we have had strong indications of these applications, in my opinion, would result in far- Congressional agreement that the bank definition reaching changes in the banking structure of this should be amended to prevent acquisitions of nonbank country, changes which should not occur without banks in conflict with the Act. Approval of the multi- Congressional direction. tude of nonbank bank applications would effect funda- For these reasons, I am particularly concerned mental changes in the structure of banking in this about the Board's decision not to disapprove the country by weakening if not altogether eliminating the notice filed under the Change in Bank Control Act by separation of banking and commerce, and the restric- Continental Telecom Inc., to acquire a nonbank bank, tions on interstate banking. While I believe that Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 55 changes in our banking system in both directions are Trust Companies were established in 1982 as nationdesirable, I also believe that such major changes ally chartered nondepository trust companies. Trust should not take place without clear authority by the Companies are currently engaged in providing fiducia- Congress. Consequently, I believe that approval of ry, investment advisory, agency and custodial serthis application would result in serious adverse effects vices—Southeast from a single office in Deerfield that would not be outweighed by the public benefits of Beach and Southwest from a single office in Sarasota. the proposal. Accordingly, I would deny this applica- Applicant proposes to expand the powers of Trust tion. Companies under their national bank charters to offer November 1, 1984 the services of a national bank, including the acceptance of time and demand deposits and the making of loans to individuals for personal, family, household, or Bank of Boston Corporation charitable purposes. Applicant has, however, stated Boston, Massachusetts that Trust Companies will not make commercial loans as that term is defined in the Board's Regulation Y, Order Approving the Expansion of Activities of Trust 12 C.F.R. § 225.2(a)(1)(B).2 On this basis, Applicant Companies to Include Offering Checking Accounts asserts that Trust Companies would not fall within the and Consumer Lending definition of "bank" in the BHC Act, and that these applications therefore are properly filed under section Bank of Boston Corporation, Boston, Massachusetts, 4(c)(8) of that Act. The Protestant, in contrast, asserts a bank holding company within the meaning of the that Trust Companies would be banks because their Bank Holding Company Act (12 U.S.C. § 1841 et demand-deposit taking activities should be combined seq.) ("BHC Act"), has applied for approval under with the commercial lending activities of other subsidiaries of Applicant. section 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and section 225.23(a)(1) of the Board's Regulation Y In its decision earlier this year in U.S. Trust Corpo- (12 C.F.R. § 225.23(a)(1)) to expand the activities of ration, the Board was constrained by the technical its subsidiaries, Bank of Boston Trust Company of definition of "bank" in the Act to conclude that a bank Southeast Florida, N.A., Deerfield Beach, Florida holding company could acquire, on an interstate basis, ("Southeast"), and Bank of Boston Trust Company of a national bank that stated it would accept demand Southwest Florida, N.A., Sarasota, Florida ("South- deposits but not make commercial loans. The Board, west") (collectively, "Trust Companies"), to include however, imposed the following conditions to prevent the acceptance of time and demand deposit accounts, the linkage or integration of the applicant's activities including checking accounts, and the making of con- with the proposed nonbank banks, as well as transacsumer loans. These activities have been previously tions between the nonbank bank and its holding comdetermined by the Board to be closely related to pany affiliates, in order to limit, to the extent possible, banking. 12 C.F.R. § 225.25(b)(1); U.S. Trust Corpo- the potential for undermining the policies of the Act: ration, 70 FEDERAL RESERVE BULLETIN 371 (1984); 1. Applicant will not operate the demand-deposit Citizens Fidelity Corporation, 69 FEDERAL RESERVE taking activities of the nonbank bank in tandem with BULLETIN 556 (1983). any other subsidiary or other financial institution; Notice of the applications, affording opportunity for 2. Applicant will not link in any way the demand interested persons to comment, has been duly pub- deposit and commercial lending services that define lished (49 Federal Register 19,737 (May 9, 1984)). The a bank under the Act; and time for filing comments and views has expired and the 3. The bank will not engage in any transaction with Board has considered the applications and all com- affiliates, other than the payment of dividends to ments received, including those submitted by the Applicant or the infusion of capital by Applicant into Florida Bankers Association in opposition to the pro- the bank, without the Board's approval. posals, in light of the factors set forth in section 4(c)(8) These conditions preclude the type of integrated of the BHC Act (12 U.S.C. § 1843(c)(8)). operation that could otherwise render Trust Compa- Applicant is the largest commercial banking organization in Massachusetts, with consolidated assets of $20 billion.1 Applicant operates nine subsidiary banks 2. The Board's definition of "commercial loan" contained in with total domestic deposits of approximately $6.8 Regulation Y is the subject of ongoing litigation. The U.S. Court of Appeals for the Tenth Circuit in Dimension Financial Corporation v. billion. Board of Governors, No. 83-2696, slip op. (10th Cir. Sept. 24, 1984), set aside the Board's definition of commercial loans. The mandate has not yet issued in that case, and the Board plans to ask the Department of Justice to file a petition for a writ of certiorari with the Supreme 1. Financial data are as of March 31, 1984. Court. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

56 Federal Reserve Bulletin • January 1985 nies banks for purposes of the BHC Act. Applicant has lending subsidiaries in an integrated fashion with Trust stated in its applications that it will comply with each Companies, and thus whether Southeast, Southwest, of these conditions. On the basis of Applicant's adher- or Applicant itself can be viewed as a "bank" within ence to these conditions and for the reasons set out the technical definition of that term contained in the more fully in the Board's decision in U.S. Trust, the BHC Act.4 The Protestant lists several areas of inquiry Board is constrained, as it was in U.S. Trust, to to be undertaken by the Board at such a hearing. conclude that Trust Companies will not fall within the First, the Protestant argues that a hearing is required BHC Act's definition of bank and that Applicant's to determine whether Applicant's commercial lending proposals are properly filed under section 4 of the subsidiaries solicit commercial loans from Florida- BHC Act. Accordingly, the Board does not find Pro- based customers. In the course of its consideration of testant's contention concerning the linkage of Appli- these applications, the Board determined that Applicant's commercial lending activities and Trust Compa- cant's two commercial lending offices in Florida have nies' demand deposit activities persuasive.3 a combined total of $160 million in outstanding com- Applicant's proposals differ from the facts presented mercial loans in that state, while Applicant's subsidin U.S. Trust in one respect: U.S. Trust Corporation iary bank in Boston has $354.1 million in commercial had no commercial lending subsidiaries located in loans outstanding to Florida customers. The existence Florida, whereas Applicant engages in commercial of such loans, however, does not necessarily result in lending in Florida through the Boca Raton office of its a linkage of demand deposit and commercial lending commercial mortgage company subsidiary and the services in the absence of evidence of integrated Tampa office of its commercial finance company sub- operations between Trust Companies and Applicant or sidiary. The conditions imposed by the Board in U.S. any of its affiliates. It is undisputed that Applicant has Trust, and relied on here, however, prohibit any no commercial lending subsidiary in close proximity to integration of the operations of Trust Companies and either Southeast or Southwest, and the Board has these commercial lending subsidiaries or any other imposed conditions on the operations of Trust Compasubsidiary of Applicant, and thus, in almost all circum- nies to prohibit integrated operations with Applicant stances, obviate concerns about integrated operations or any of its subsidiaries. As noted, Applicant has arising from geographic location. While circumstances stated in its applications that it will strictly adhere to could arise, for example in the case of location of these conditions. The Protestant has offered no eviaffiliate operations in the same building or otherwise in dence that Applicant will not comply with the condiclose physical proximity, that might result in a differ- tions imposed by the Board, conditions which the ent conclusion, such a situation does not exist in this Board has specific authority to enforce under the BHC case. Act and the Financial Institutions Supervisory Act of 1966. There is no evidence in the record of integrated operations between Trust Companies and any office or The Protestant also claims that a hearing is required affiliate of Applicant engaged in commercial lending. to probe Applicant's "history of integrating the activi- The Board also finds no evidence that consummation ties of its subsidiaries" as well as an alleged pattern of of these proposals would result in any conflicts of integrated operations between Applicant's commercial interest, unfair competition, unsound banking prac- lending activities in Florida and the activities of Applitices or other adverse effects. Due to the de novo cant's commercial bank subsidiaries to show that the nature of these proposals, there will not be any de- dynamics of "corporate socialization" preclude the crease in competition. Indeed, consummation of the independent operation of Trust Companies. The Proproposals may reasonably be expected to result in testant offers no facts to support its contentions of a increased competition. history of integrated operations or "corporate socialization." Bare allegations are insufficient to warrant a hearing. Moreover, any history of operations of other Protestant's Hearing Request subsidiaries of Applicant would be largely immaterial since these subsidiaries do not operate under the The Protestant has requested a formal hearing on the specific conditions imposed by the Board in this Order issue of whether Applicant will operate its commercial to prevent integrated operations. 3. In its U.S. Trust Order, the Board also concluded that consummation of that proposal was not barred by any valid provision of 4. The Board addressed a similar issue in its U.S. Trust Order, 70 Florida law. For the reasons set out in that decision, the Board FEDERAL RESERVE BULLETIN 371, 373. The Board continues to continues to adhere to its conclusion in that case regarding the believe that the Protestant is raising a legal issue dealing with the constitutionality of the Florida statute upon which the Protestant technical definition of the term "bank" in the BHC Act that is not an relies. appropriate issue for a formal hearing. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 57 The type of information the Protestant requests the If the nonbank bank concept, particularly as ex- Board to compel Applicant to supply in the course of a panded by the interpretation of demand deposits and hearing has been obtained by the Board, including the commercial loans adopted by the Tenth Circuit, benature of offices maintained by Applicant in Florida, comes broadly generalized, a bank holding company the extent of commercial lending by the Florida offices or commercial or industrial company, through exploiof Applicant's subsidiaries, and the commercial lend- tation of an unintended loophole, could operate ing to Florida customers by Applicant's commercial "banks" that offer NOW accounts and make commerbank subsidiaries located outside of Florida. The cial loans in every state, thus defeating Congressional Board finds the other materials sought, such as leasing policies on commingling of banking and commerce, and factoring activities in Florida by Applicant's sub- conflicts of interest, concentration of resources and sidiaries, to be immaterial in view of the conditions excessive risk, or with respect to limitations on interimposed by the Board, which would prevent any state banking. With the lifting of the moratorium on integration of such activities with the operations of the chartering of nonbank banks by the Comptroller of Trust Companies. The request for a hearing must be the Currency, action by the Congress is imperative to based upon a showing that there are material facts ensure that the policies of the BHC Act are maintruly disputed. Connecticut Bankers Association v. tained. Board of Governors, 627 F.2d 245 (D.C. Cir. 1980). The fact that the Board is required by the technical The Board finds no such material facts at issue and, aspects of the bank definition in the Act to approve accordingly, denies the Protestant's request for a these and similar applications today should not be hearing. construed as encouragement to the applicants to consummate these proposals or to others to pursue similar Need for Congressional Action acquisitions. In this regard, the Board notes that legislation passed by the United States Senate and the In its U.S. Trust Corporation Order, the Board ad- House Banking Committee would clarify the definition dressed the critical need for legislation to apply the of the term bank in the BHC Act to include all FDICpolicies of the BHC Act to companies that control insured banks. Enactment of this legislation would institutions that are chartered as banks and that offer preclude acquisition of so-called nonbank banks by transaction accounts to the public. Since the Board's bank holding companies on an interstate basis, such as U.S. Trust decision, 55 bank holding companies have proposed in these applications, and by nonbanking applied to the Comptroller for approximately 330 concerns, and would require divestiture of any nonnational nonbank bank charters and a number of large bank bank acquired after June 30, 1983. The Chairmen nonbanking companies, including retail, securities, of the two Congressional banking committees have and insurance concerns, have acquired, or announced announced that they intend to address this nonbank their intentions to acquire, nonbank banks. The ap- bank issue in the next session of Congress, and that proval of these applications and the others approved the grandfather date in the legislation for nonbank today underscore the critical need for Congress to take banks will not be altered. The Board wishes to call to final action on legislation to close the so-called non- the Applicant's attention that in the event this legislabank bank loophole. tion is enacted, Applicant would be required to divest The recent decisions of the United States Court of Trust Companies or otherwise limit the activities of Appeals for the Tenth Circuit reversing the Board's Trust Companies to comply with the legislation, and interpretation of NOW accounts as demand deposits Applicant could suffer financial loss as a result. and the Board's definition of "commercial loans" for Based upon the foregoing and all the facts of record, purposes of the BHC Act5 serve to make nonbank the Board has determined that the balance of public banks a more attractive acquisition target by making interest factors it is required to consider under section them even more clearly like traditional commercial 4(c)(8) is favorable. Accordingly, the applications are banks. The continued acquisition of nonbank banks by hereby approved. If these proposals are consummatsecurities, insurance, and other nonbanking organiza- ed, they shall be subject to the conditions set forth in tions presents the potential for a significant, haphaz- this order with respect to avoiding operation of an ard, and possibly dangerous alteration of the banking integrated institution and the conditions set forth in the structure, without Congressional action on the under- Board's Regulation Y, including those in sections lying policy issues. 225.4(d) and 225.23(b). The approval is also subject to the Board's authority to require modification or termination of the activities of the holding company or any 5. First Bancorporation v. Board of Governors, 728 F.2d 434 (10th of its subsidiaries as the Board finds necessary to Cir. 1984), and Dimension Financial Corporation v. Board of Governors, No. 83-2696, slip op. (10th Cir. September 24, 1984). assure compliance with the provisions and purposes of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

58 Federal Reserve Bulletin • January 1985 the Act and the Board's regulations and orders issued (1984)). The time for filing comments has expired, and thereunder, or to prevent evasion thereof. In accord- the Board has considered the application and all ance with the provisions of section 225.23(b)(l)(iii) of comments received in light of the public interest Regulation Y, the Board's approval would be required factors set forth in section 4(c)(8) of the Act. for additional acquisitions by Applicant of nonbank Citicorp is a bank holding company by virtue of its banks or for the establishment of offices of Trust control of five commercial banks and, in terms of Companies to be located in a state other than Florida. domestic deposits, is the second largest commercial By order of the Board of Governors, effective banking organization in New York. With total assets November 1, 1984. of $144.7 billion as of September 30, 1984, Citicorp is the largest bank holding company in the United States. Voting for this action: Chairman Volcker and Governors Citicorp also engages in a variety of nonbanking Partee, Gramley, and Seger. Voting against this action: activities, including mortgage banking, commercial Governors Wallich and Rice. Absent and not voting: Goverlending and leasing, the sale of credit-related insurnor Martin. ance, and data processing activities. Citicorp proposes to engage de novo in the issuance JAMES MCAFEE and sale of variably denominated payment instruments [SEAL] Associate Secretary of the Board with a face value of up to $10,000. These instruments will include money orders and official checks and will be issued on a world-wide basis. These instruments Dissenting Statement of Governors Wallich and Rice will be sold primarily by Citicorp's subsidiaries, unaffiliated banks, savings and loan associations, and other For the reasons set forth in our dissents today from the financial institutions. Regulation Y includes the issu- Board's decision to approve the application of Bank- ance or sale of money orders and other similar coners Trust New York Corporation to acquire a nonbank sumer-type payment instruments with a face value not bank in Florida, we would deny this application. exceeding $1,000 on the list of permissible nonbanking activities.1 The Board has previously approved an November 1, 1984 application by BankAmerica Corporation to engage in the issuance of payment instruments with a maximum Citicorp face value of $10,000. In its Order, the Board found New York, New York that an increase in the denomination of such instruments would not affect the fundamental nature of the Order Approving the Sale and Issuance of payment instruments, and the Board concluded that Payment Instruments and Related Activities the issuance and sale of the proposed instruments is closely related to banking.2 Citicorp, New York, New York, a bank holding com- In order to approve this application, the Board must pany within the meaning of the Bank Holding Compa- also find that the performance of the proposed activity ny Act ("Act"), has applied for the Board's approval by a nonbank affiliate of Applicant "can reasonably be under section 4(c)(8) of the Act (12 U.S.C. expected to produce benefits to the public such as § 1843(c)(8)) and section 225.23 of the Board's Regula- greater convenience, increased competition, or gains tion Y (12 C.F.R. § 225.23) to engage de novo directly in efficiency, that outweigh possible adverse effects, or indirectly, through its subsidiary, Citicorp Services, such as undue concentration of resources, decreased Inc., Chicago, Illinois ("CSI"), in the issuance and or unfair competition, conflicts of interests, or unsale of variably denominated payment instruments sound banking practices." with a maximum face value of $10,000. These instru- Official checks and consumer-type payment instruments will be sold primarily by Citicorp's subsidiaries ments, such as traditional money orders, are marketed and unaffiliated financial institutions throughout the nationally on the wholesale level by a few large world. In connection with this application, Citicorp organizations and locally on a retail level by a wide has applied to engage through CSI in certain data variety of financial and nonfinancial institutions. On processing, marketing, and other services related to the issuance and sale of the payment instruments. Notice of the application, affording interested persons an opportunity to submit comments on the relatedness of the proposed activity to banking, and on the balance of public interest factors regarding the applica- 1. 12 C.F.R. § 225.25(b)(12)). 2. BankAmerica Corporation, 70 FEDERAL RESERVE BULLETIN 364 tion, has been published (49 Federal Register 40,447 (1984). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 59 the national scale, the market is concentrated, being telephone access to customer service centers, reissue dominated by only a few large organizations.3 Entry lost or stolen instruments, provide photocopying of into this business on a national scale involves over- paid instruments, and the selling institution will be coming significant barriers because a potential entrant required to disclose to purchasers if a right to stop must possess the capability for managing the extensive payment exists and how that right can be exercised. sales and servicing operation necessary for handling a The Board believes that such services would benefit low-unit-price, high-volume product. Such capabilities the purchasers of these instruments. In summary, the frequently are associated with banking organizations Board finds that these instruments, which will be of significant size such as Citicorp. Citicorp's entry issued by a large financial organization and will enjoy into this market would result in increased competition ready acceptability, will offer greater convenience and in this industry and may be expected ultimately to benefits to the public and foster increased competition result in increased prospects for some deconcentration in the industry. of the industry in the future. Accordingly, the Board Citicorp also has applied to engage, through its views Citicorp's proposal as procompetitive and in the subsidiary, Citicorp Services, Inc., in marketing and public interest insofar as it relates to the issuance of servicing activities for its payment instruments. These instruments that are intended primarily for use by services will include coordinating advertising proconsumers. grams, developing marketing and sales materials, and In its past consideration of the issuance of variably providing customer service and certain data processdenominated payment instruments, the Board has ing activities. The Board believes that these activities been concerned that the issuance of such instruments are either permissible under Regulation Y or may be with a face value of over $1,000 would result in an performed as incidental to the principal activity of adverse effect on the reserve base. Because reserve issuing and selling payment instruments.4 requirements serve as an essential tool of monetary Based upon the foregoing and other considerations policy, the Board is concerned that this proposal may reflected in the record, the Board has determined that result in adverse effects due to the erosion of the the balance of the public interest factors the Board is reservable deposits of the banking system. required to consider under section 4(c)(8) is favorable In its BankAmerica Order, the Board decided that with respect to the activity of issuing consumer- BankAmerica and any other bank holding company oriented payment instruments. This determination is that receives approval to engage in this activity would subject to all of the conditions set forth in Regulation be required to file with the Board weekly reports of Y, including section 225.4(d) and 225.23(b), and to the daily data on this activity for use in conjunction with Board's authority to require such modification or measuring and interpreting the money stock and for termination of the activities of a holding company or assessing the effects of the proposal on the reserve any of its subsidiaries as the Board finds necessary to base. The Board also determined to closely monitor assure compliance with the provisions and purposes of the effects of such proposals by bank holding compa- the Act and the Board's regulations and orders issued nies on the Board's conduct of monetary policy. If it thereunder, or to prevent evasion thereof. later appears that the result of such proposals is a The activities approved hereby shall be commenced significant reduction in the reserve base or other not later than three months after the effective date of adverse effect on the conduct of monetary policy, the this Order, unless such period is extended for good Board may impose reserve requirements on such cause by the Board or by the Federal Reserve Bank of transactions, pursuant to section 19 of the Federal New York. Reserve Act (12 U.S.C. § 461(a)) and the Board's By order of the Board of Governors, effective Regulation D (12 C.F.R. Part 204). November 28, 1984. In addition to increased competition, Citicorp states that its proposal should provide benefits to the public Voting for this action: Chairman Volcker and Governors through reduced costs and increased convenience to Martin, Wallich, Partee, Rice, Gramley, and Seger. Abstainthe purchaser. Citicorp states that it will provide ing from the data processing portion of this application: Governors Wallich and Gramley. JAMES MCAFEE [SEAL] Associate Secretary of the Board 3. Money orders are primarily used to transmit money by members of the consumer public who do not or cannot maintain checking accounts. Official checks can be used as a substitute for a variety of payment instruments, such as cashier's checks, and could be used by businesses as part of their cash management strategy. Traditionally, money orders have a maximum face value printed on the instrument, which is generally at or lower than the limit set by Regulation Y. 4. 12 C.F.R. § 225.25(a)(7) and (a)(ll). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

60 Federal Reserve Bulletin • January 1985 Norwest Corporation from the insurance prohibition of the Act insurance Minneapolis, Minnesota agency activities conducted by bank holding companies that received Board approval prior to 1971 to Order Approving Application to Transfer engage in such activities. General Insurance Agency Activities The record reflects that Applicant has been engaged in general insurance agency activities on a continuous Norwest Corporation, Minneapolis, Minnesota, a basis since 1929 and received Board approval in 1959 bank holding company within the meaning of the Bank to retain its general insurance agency subsidiaries. (45 Holding Company Act of 1956, as amended (12 U.S.C. FEDERAL RESERVE BULLETIN 963 (1959)). Moreover, § 1841 et seq.) (the "Act"), has applied under section the Board previously has held that Norwest is one of 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and section 16 active bank holding companies that qualifies for 225.23 of the Board's Regulation Y (12 C.F.R. exemption G as a company that engaged in insurance § 225.23) for the Board's approval to transfer the agency activities pursuant to Board approval prior to insurance agency activities of its subsidiary bank, 1971. The Board has determined that since Norwest Norwest Bank Two Harbors, N.A. ("Bank"), Two was approved to engage in general insurance agency Harbors, Minnesota, to Applicant's insurance agency activities prior to 1971, Norwest may continue to subsidiary, Norwest Agencies, Inc. ("Company"), engage in such general insurance activities without Minneapolis, Minnesota. restriction as to location or type of insurance sold. Notice of the application, affording interested per- Norwest Corporation, 70 FEDERAL RESERVE BULLEsons an opportunity to submit comments, has been TIN 470 (1984); 70 FEDERAL RESERVE BULLETIN 235 duly published. 49 Federal Register 35,695 (1984). The (1984). time for filing comments has expired, and the Board Bank, a subsidiary of Applicant, presently engages has considered the application and all comments re- in general insurance agency activities from its main ceived in light of the public interest factors set forth in office in Two Harbors and its branch office in Silver section 4(c)(8) of the Act. Bay, Minnesota.4 Applicant seeks to transfer Bank's Applicant, with consolidated assets of $21.4 billion,1 general insurance activities to Company for manageis one of the two largest commercial banking organiza- ment and efficiency purposes. Upon consummation of tions in Minnesota. Applicant controls 86 banking the proposal, these activities would continue to be organizations in seven states in the Midwest and owns conducted from Bank's present offices. a number of subsidiaries engaged in nonbanking activi- There is no evidence in the record to indicate that ties, including Company. Company holds the stock of consummation of Applicant's proposal would result in 35 general insurance agencies and coordinates the any undue concentration of resources, decreased or activities of 26 additional affiliated agencies on behalf unfair competition, conflicts of interests, unsound of Applicant, and now proposes to conduct the insur- banking practices, or other adverse effects. Moreover, ance agency activities currently performed by Bank.2 the Board has determined that the balance of the Title VI of the Garn-St Germain Depository Institu- public interest factors it is required to consider under tions Act of 1982 ("Garn-St Germain Act") amended section 4(c)(8) of the Act is favorable. Applicant has section 4(c)(8) of the Act to provide that insurance indicated that it will use Company's centralized manactivities are not "closely related to banking" and thus agement system to enhance the efficiency of Bank's are not permissible activities for bank holding compa- existing insurance agency activities. Moreover, Applinies, unless the activities are included within one of cant would continue to serve as an alternative source seven specific exemptions (contained in clauses A of insurance services in a predominantly rural area.5 through G) of section 4(c)(8). Applicant has applied to Accordingly, based upon the foregoing and other acquire Agency and to engage in general insurance facts of record, the Board has determined that the agency activities under exemption G,3 which exempts application should be and hereby is approved. This determination is subject to all the conditions set forth 1. Asset data are as of June 30, 1984. 2. Company acts as liaison between the agencies and various insurance companies in the negotiation and administration of group tion under exemption G, consideration of Applicant's eligibility to commission and contingency contracts. Company also provides per- engage in general insurance agency activities under exemptions C or D sonnel recruiting and training assistance and aids the agencies in sales, is not necessary. underwriting, and claim problems. 4. Bank's service area for its general insurance agency activities 3. Applicant has applied in the alternative to transfer these activi- comprises northeastern Minnesota. ties under authority of exemptions C or D of section 4(c)(8), 12 U.S.C. 5. Two Harbors and Silver Bay are communities with populations §§ 1843(c)(8)(C), (D). In view of the Board's approval of this applica- not exceeding 5,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 61 in Regulation Y, including those in sections 225.4(d) banking. 12 C.F.R. § 225.25(b)(1); U.S. Trust Corpoand 225.23(b) (12 C.F.R. §§ 225.4(d) and 225.23(b)), ration, 70 FEDERAL RESERVE BULLETIN 371 (1984); and to the Board's authority to require such modifica- Citizens Fidelity Corporation, 69 FEDERAL RESERVE tion or termination of the activities of a bank holding BULLETIN 556 (1983); First Bancorporation, 68 FEDcompany or any of its subsidiaries as the Board finds ERAL RESERVE BULLETIN 253 (1982). necessary to assure compliance with the provisions Notice of the application, affording opportunity for and purposes of the Act and the Board's regulations interested persons to comment, has been duly puband orders issued thereunder, or to prevent evasion lished (49 Federal Register 21,117 (1984)). The time for thereof. filing comments and views has expired and the Board Moreover, upon a review of the record, the Board has considered the application and all comments realso has concluded that further applications by Nor- ceived in light of the factors set forth in section 4(c)(8) west Corporation to acquire additional general insur- of the Act (12 U.S.C. § 1843(c)(8)). ance agencies or to transfer such activities among its Applicant is the fourth largest commercial banking subsidiaries, may be processed in the same manner organization in Maryland, with total consolidated asas other de novo or going concern applications under sets of $2.6 billion.1 Applicant operates one subsidiary the provisions of section 225.23 of Regulation Y bank with total deposits of approximately $2.0 billion, (12 C.F.R. § 225.23), and authority is hereby delegated representing approximately 12 percent of the deposits to the Federal Reserve Bank of Minneapolis to accept in commercial banks in Maryland. Applicant is the and take action on such notices properly filed as there fourth largest commercial banking organization in the prescribed. Washington, D.C. banking market2 with 58 offices and This transaction shall be consummated not later deposits of $1.5 billion, representing approximately than three months after the effective date of this 8.7 percent of the deposits in commercial banks in the Order, unless such period is extended for good cause market. by the Board or by the Federal Reserve Bank of SBW is newly chartered as a national bank. Appli- Minneapolis, acting pursuant to delegated authority. cant proposes to operate SBW in Washington, D.C., By order of the Board of Governors, effective as a nonbank bank that will accept time and demand November 5, 1984. deposits and make loans to individuals for personal, family, household, or charitable purposes. Applicant Voting for this action: Chairman Volcker and Governors has committed, however, that SBW will not engage in Martin, Partee, Rice, Gramley, and Seger. Abstaining from the business of making commercial loans as that term this action: Governor Wallich. is defined in the Board's Regulation Y.3 12 C.F.R. § 225.2(a)(l)(8). On this basis, Applicant asserts that JAMES MCAFEE SBW would not be a "bank" under the BHC Act, and [SEAL] Associate Secretary of the Board that this application therefore is properly filed under section 4(c)(8) of that Act. In its decision earlier this year in U.S. Trust Corporation, the Board was constrained by the technical Suburban Bancorporation definition of "bank" in the Act to conclude that a bank Bethesda, Maryland holding company could acquire, on an interstate basis, a national bank that stated it would accept demand Order Approving the Acquisition of an Institution deposits but not make commercial loans. The Board Offering Checking Accounts and Consumer Lending however, imposed the following conditions to prevent the linkage or integration of the applicant's activities Suburban Bancorporation, Bethesda, Maryland, a bank holding company within the meaning of the Bank Holding Company Act (12 U.S.C. § 1841 et seq.) ("BHC Act"), has applied for approval under section 1. Financial data are as of December 31, 1983. 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and section 2. The Washington, D.C. banking market is approximated by the Washington Ranally Metro Area ("RMA"), which includes the Dis- 225.23(a)(1) of the Board's Regulation Y (12 C.F.R. trict of Columbia and adjoining portions of Maryland and Virginia. § 225.23(a)(1)) to acquire Suburban Bank/Washington, 3. The Board's definition of "commercial loan" contained in N.A., Washington, D.C. ("SBW"), a de novo non- Regulation Y is the subject of ongoing litigation. The U.S. Court of Appeals for the Tenth Circuit in Dimension Financial Corporation v. bank bank that will offer time and demand deposit Board of Governors, No. 83-2696, slip op. (10th Cir. Sept. 24, 1984), accounts, including checking accounts, and make con- set aside the Board's definition of commercial loans. The mandate has not yet issued in that case, and the Board plans to ask the Department sumer loans. These activities have been previously of Justice to file a petition for a writ of certiorari with the Supreme determined by the Board to be closely related to Court. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Federal Reserve Bulletin • January 1985 with the proposed nonbank bank, as well as transac- Need for Congressional Action tions between the nonbank bank and its holding company affiliates, in order to limit, to the extent possible, In its U.S. Trust Corporation Order, the Board adthe potential for undermining the policies of the Act: dressed the critical need for legislation to apply the 1. Applicant will not operate the demand-deposit policies of the BHC Act to companies that control taking activities of the bank in tandem with any institutions that are chartered as banks and that offer other subsidiary or other financial institution; transaction accounts to the public. Since the Board's 2. Applicant will not link in any way the demand U.S. Trust decision, 55 bank holding companies have deposit and commercial lending services that define applied to the Comptroller for approximately 330 a bank under the Act; and national nonbank bank charters and a number of large 3. The nonbank bank will not engage in any transac- nonbanking companies, including retail, securities and tions with affiliates, other than the payment of insurance concerns, has acquired, or announced their dividends to Applicant or the infusion of capital by intentions to acquire, nonbank banks. The approval of Applicant into the bank, without the Board's ap- this application and the others approved today underproval. score the critical need for Congress to take final action These conditions preclude the type of integrated on legislation to close the so-called nonbank bank operation that could otherwise render SBW a bank for loophole. purposes of the Act. Applicant has stated in its appli- The recent decisions of the United States Court of cation that it will comply with each of these condi- Appeals for the Tenth Circuit reversing the Board's tions. On the basis of Applicant's adherence to these interpretation of NOW accounts as demand deposits conditions and for the reasons set out more fully in the and the Board's definition of "commercial loans" for Board's decision in U.S. Trust, the Board is con- purposes of the BHC Act4 serve to make nonbank strained, as it was in U.S. Trust, to conclude that SBW banks a more attractive acquisition target by making will not be a bank as that term is defined in the BHC them even more clearly like traditional commercial Act and that Applicant's proposal is properly filed banks. The continued acquisition of nonbank banks by under section 4 of the BHC Act. securities, insurance, and other nonbanking organiza- Applicant's proposal differs from the facts presented tions presents the potential for a significant, haphazin U.S. Trust in one respect: U.S. Trust Corporation ard, and possibly dangerous alteration of the banking had no commercial lending subsidiaries located in the structure, without Congressional action on the undersame state or market where it proposed to operate its lying policy issues. nonbank bank, whereas Applicant has its headquarters If the nonbank bank concept, particularly as exand 58 offices of its subsidiary bank operating in the panded by the interpretation of demand deposits and same Washington, D.C., market as it proposes to commercial loans adopted by the Tenth Circuit, beoperate SBW. The conditions imposed by the Board in comes broadly generalized, a bank holding company U.S. Trust, and relied on here, however, prohibit any or commercial or industrial company, through exploiintegration of the operations of SBW and Applicant's tation of an unintended loophole, could operate subsidiary bank or any other subsidiary of Applicant, "banks" that offer NOW accounts and make commerand thus, in almost all circumstances, obviate con- cial loans in every state, thus defeating Congressional cerns about integrated operations arising from geo- policies on commingling of banking and commerce, graphic location. While circumstances could arise, for conflicts of interest, concentration of resources and example in the case of location of affiliate operations in excessive risk, or with respect to limitations on interthe same building or otherwise in close physical prox- state banking. With the lifting of the moratorium on imity, that might result in a different conclusion such a the chartering of nonbank banks by the Comptroller of situation does not exist in this case. the Currency, action by the Congress is imperative to There is no evidence in the record of integrated ensure that the policies of the BHC Act are mainoperations between SBW and any office or affiliate of tained. Applicant engaged in commercial lending. The Board The fact that the Board is required by the technical also finds no evidence that consummation of this aspects of the bank definition in the Act to approve proposal would result in any conflicts of interest, unfair competition, unsound banking practices or other adverse effects. Due to the de novo nature of this proposal, there will not be any decrease in competition. Indeed, consummation of the proposal may reasonable be expected to result in increased competi- 4. First Bancorporation v. Board of Governors, 728 F.2d 434 (10th Cir. 1984), and Dimension Financial Corporation v. Board of Govertion. nors, No. 83-2696, slip op. (10th Cir. September 24, 1984). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 63 this and similar applications today should not be Dissenting Statement of Governors Wallich and Rice construed as encouragement to the applicants to consummate these proposals or to others to pursue similar For the reasons set forth in our dissents today from the acquisitions. In this regard, the Board notes that Board's decision to approve the application of Banklegislation passed by the United States Senate and the ers Trust New York Corporation to acquire a nonbank House Banking Committee would clarify the definition bank in Florida, we would deny this application. of the term bank in the BHC Act to include all FDICinsured banks. Enactment of this legislation would November 1, 1984 preclude acquisition of so-called nonbank banks by bank holding companies on an interstate basis, such as proposed in this case, and by nonbanking concerns, Orders Issued Under Sections 3 and 4 of Bank and would require divestiture of any nonbank bank Holding Company Act acquired after June 30, 1983. The Chairmen of the two Congressional banking committees have announced United Mizrahi Overseas Holding Company that they intend to address this nonbank bank issue in B.V. the next session of Congress, and that the grandfather Amsterdam, The Netherlands date in the legislation for nonbank banks will not be altered. The Board wishes to call to the Applicant's Order Approving the Formation of a Bank Holding attention that in the event this legislation is enacted, Company Applicant would be required to divest Trust Company or otherwise limit Trust Company's activities to com- United Mizrahi Overseas Holding Company B.V., ply with the legislation, and Applicant could suffer Amsterdam, The Netherlands ("Company"), has apfinancial loss as a result. plied for Board approval under section 3(a)(1) of the Based upon the foregoing and all the facts of record, Bank Holding Company Act (12 U.S.C. § 1842(a)(1)) the Board has determined that the balance of public to become a bank holding company by acquiring the interest factors it is required to consider under section shares of UMB Bank and Trust Company, New York, 4(c)(8) is favorable. Accordingly, the application is New York ("Bank"). Company has also applied for hereby approved. If this proposal is consummated, it Board approval under section 4(c)(13) of the Act shall be subject to the conditions set forth in this Order (12 U.S.C. § 1843(c)(13)) to acquire the shares of with respect to avoiding operation of an integrated United Mizrahi Casa Bancaria, Montevideo, Uruguay institution and the conditions set forth in the Board's ("UMB Uruguay"); United Mizrahi Bank (Switzer- Regulation Y, including those in sections 225.4(d) and land) Ltd., Zurich, Switzerland ("UMB Switzer- 225.23(b). The approval is also subject to the Board's land"); and United Mizrahi Financial Corporation authority to require modification or termination of the Ltd., London, England ("UMB England"); and to activities of the holding company or any of its subsid- continue to engage through UMB Switzerland in tradiaries as the Board finds necessary to assure compli- ing platinum and palladium for the account and upon ance with the provisions and purposes of the Act and the order of customers of UMB Switzerland. the Board's regulations and orders issued thereunder, Notice of the application under section 3 of the Act, or to prevent evasion thereof. In accordance with the affording an opportunity for interested persons to provisions of section 225.23(b)(l)(iii) of Regulation Y, submit comments, has been given in accordance with the Board's approval would be required for additional section 3(b) of the Act. The time for filing comments acquisitions by Applicant of nonbank banks or for the has expired, and the Board has considered the applicaestablishment of offices of SBW to be located outside tion and all comments received in light of the factors of the District of Columbia. set forth in section 3(c) of the Act. By order of the Board of Governors, effective Company is a nonoperating corporation, a majority November 1, 1984. of whose shares are owned by Mizrahi Holdings Association, Tel Aviv, Israel ("MHA"), and United Voting for this action: Chairman Volcker and Governors Mizrahi Bank Ltd., Tel Aviv, Israel, both of which are Partee, Gramley, and Seger. Voting against this action: registered bank holding companies. The Board has Governors Wallich and Rice. Absent and not voting: Goverpreviously approved the acquisition of shares of Bank nor Martin. by MHA and United Mizrahi Bank Ltd.1 The pro- JAMES MCAFEE [SEAL] Associate Secretary of the Board 1. 64 FEDERAL RESERVE BULLETIN 319 (1978). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Federal Reserve Bulletin • January 1985 posed transaction is a corporate reorganization in effects that may be associated with this activity, UMB which Company will acquire from United Mizrahi Switzerland has instituted certain policies and proce- Bank Ltd. the shares of Bank, UMB Uruguay, UMB dures regarding the conduct of this activity that in- Switzerland, and UMB England. Company will also clude the prior review and approval of each proposed acquire shares from minority shareholders of Bank in transaction by UMB Switzerland's credit committee exchange for its shares. before any trade is initiated. In addition, trading in Bank, with total assets of $506 million, controls less platinum and palladium is subject to strict margin than one percent of the total deposits in commercial requirements of between 25 and 50 percent for each banks in New York State.2 In view of the fact that the transaction. UMB Switzerland has also committed proposed transaction represents a corporate reorgani- that it will not trade platinum or palladium for its own zation, consummation of the proposed transaction will account. not have any significant adverse effects on existing or Based on all of the facts of record, the Board has potential competition in any relevant market. determined that approval of Company's proposal to The proposed reorganization will allow MHA and continue to trade platinum and palladium through United Mizrahi Bank Ltd. to establish an organization- UMB Switzerland for the account and upon the order al structure that will permit additional access, through of customers of UMB Switzerland would not be sub- Company, to capital markets for the purpose of sup- stantially at variance with the supervisory or other porting the future needs of Bank. In light of this and purposes of the Bank Holding Company Act. the fact that Bank will be provided additional capital as Accordingly, based on the foregoing, the commitpart of the proposed transaction, the financial and ments offered by Company, and all of the other facts of managerial resources of Company, MHA, United Miz- record, the Board has determined that approval of the rahi Bank Ltd., and Bank are considered generally applications under section 3 and section 4(c)(13) of the satisfactory and their future prospects appear favor- Act would be consistent with the public interest, and able. While no new services will be offered as a result that the applications should be, and hereby are, apof consummation of the proposal, there is no evidence proved. The acquisition by Company of shares of that the banking needs of the community to be served Bank shall not be consummated before the thirtieth are not being met. Accordingly, considerations relat- calendar day following the effective date of this Order, ing to the convenience and needs of the community to or later than three months after the effective date of be served are consistent with approval of this applica- this Order, unless such period is extended for good tion. cause by the Board or the Federal Reserve Bank of Company has also applied for Board approval under New York, acting pursuant to delegated authority. section 4(c)(13) of the Act to acquire UMB Uruguay, By order of the Board of Governors, effective UMB Switzerland, and UMB England, and to engage, November 28, 1984. through UMB Switzerland, in trading platinum and palladium for the account and upon the order of Voting for this action: Chairman Volcker and Governors customers of UMB Switzerland. The activities of Martin, Wallich, Partee, Rice, Gramley, and Seger. UMB Uruguay, UMB Switzerland, and UMB England include banking and activities that the Board has JAMES MCAFEE determined are permissible activities for U.S. banking [SEAL] Associate Secretary of the Board organizations under section 211.5(d) of the Board's Regulation K (12 C.F.R. § 211.5(d)). Company contends that trading platinum and palladium for the account and upon the order of customers is usual in connection with the conduct of banking in Orders Issued Under Section 18 of Bank Switzerland and the record indicates that the five Merger Act largest Swiss banking organizations conduct these activities on behalf of their customers. In order to limit the risk to UMB Switzerland and any other adverse M&I Marshall & Ilsley Bank Milwaukee, Wisconsin Order Approving the Merger of Banks M&I Marshall & Ilsley Bank, Milwaukee, Wisconsin, has applied for the Board's approval under the Bank 2. All banking data are as of June 30, 1984. Merger Act (12 U.S.C. § 1828(c)) to merge with the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 65 Milwaukee County Bank, West Allis, Wisconsin the eleventh largest commercial banking organization ("Bank") under the charter and name of Applicant.' in the market, controlling deposits of $118.3 million, Notice of the application, affording interested per- representing 1.4 percent of the total deposits in comsons an opportunity to submit comments, has been mercial banks in the market. Upon consummation of given in accordance with the Bank Merger Act and the this proposal, Applicant would become the second Board's Rules of Procedure (12 C.F.R. § 262.3(b)). largest banking organization in the market, controlling As required by the Bank Merger Act, reports on the 11.5 percent of the total deposits in commercial banks competitive effects of the merger were requested from in the market, and Corporation's share of total deposthe United States Attorney General, the Comptroller its in commercial banks in the market would increase of the Currency, and the Federal Deposit Insurance from 15.8 percent to 17.2 percent. Corporation. The time for filing comments has ex- While approval of the proposed transaction would pired, and the Board has considered the application result in the elimination of some existing competition and all comments received in light of the factors set between Applicant and Bank, the Board does not forth in section 18(c) of the Bank Merger Act. believe that consummation of the proposal would have Applicant is the lead bank subsidiary of Marshall & any significant effects on competition in the Milwau- Ilsley Corporation, Milwaukee, Wisconsin ("Corpora- kee market. The market is considered to be only tion"). Corporation is the second largest commercial moderately concentrated, with a four-firm concentrabanking organization in Wisconsin, controlling 29 tion ratio of 65 percent and a Herfindahl-Hirschman banking subsidiaries with total deposits of approxi- Index ("HHI") of 1416. Consummation of the proposmately $2.5 billion, representing 9.1 percent of total al would increase the four-firm concentration level by deposits in commercial banks in Wisconsin.2 Bank is only 1.4 percentage points and the HHI by 46 points. the 38th largest banking organization in the state with In addition, numerous banking organizations would deposits of $118.3 million, representing less than one remain as competitors of Applicant after consummapercent of total deposits in commercial banks in Wis- tion. Accordingly, the Board concludes that Appliconsin. Upon consummation of this proposal, Corpo- cant's acquisition of Bank would not have any signifiration would control total deposits of approximately cant adverse effects on competition in any relevant $2.6 billion, representing 9.5 percent of total deposits area and that competitive considerations are consisin commercial banks in the state. Corporation's rank tent with approval of the application. would not change as a result of the proposed merger. The financial and managerial resources of Appli- Accordingly, the Board concludes that the merger of cant, Corporation, and Bank are considered satisfac- Applicant and Bank would have no significant effect tory and their future prospects appear favorable. Conon the concentration of banking resources in Wiscon- siderations relating to the convenience and needs of sin. the community to be served are also consistent with Applicant and Bank both compete in the Milwau- approval. kee, Wisconsin, banking market.3 Applicant is the Based on the foregoing and other facts of record, the third largest of 48 commercial banking organizations in Board has determined that consummation of the transthe market, controlling deposits of $845 million which action would be in the public interest and that the represent 10.1 percent of the total deposits in commer- application should be approved. On the basis of the cial banks in the market. Corporation's six other record, the application is approved for the reasons commercial banking subsidiaries in the market, togeth- summarized above. The transaction shall not be coner with Applicant, control 15.8 percent of the total summated before the thirtieth calendar day following deposits in commercial banks in the market. Bank is the effective date of this Order, or later than three months after the effective date of this Order, unless such period is extended by the Board or by the Federal Reserve Bank of Chicago, acting pursuant to delegated authority. By order of the Board of Governors, effective November 13, 1984. 1. Applicant has also applied under section 9 of the Federal Reserve Act for permission to establish a branch in the location where Bank has its main office. In acting to approve the application under the Voting for this action: Chairman Volcker and Governors Bank Merger Act, the Board also hereby approves Applicant's Martin, Partee, Rice, Gramley, and Seger. Absent and not application under section 9 of the Federal Reserve Act. voting: Governor Wallich. 2. Banking data are as of December 31, 1983. 3. The Milwaukee banking market is approximated by the Milwaukee, Wisconsin, Rand McNally Metro Area which consists of Milwau- JAMES MCAFEE kee, Waukesha, and Ozaukee Counties plus portions of Jefferson, Racine, Walworth, and Washington Counties, all in Wisconsin. [SEAL] Associate Secretary of the Board Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Federal Reserve Bulletin • January 1985 Orders Issued Under Section 5 of Bank Service Section 4(f) of the BSCA, 12 U.S.C. § 1864(f), Corporation Act provides that a bank service corporation may perform at any geographic location any service, other than American National Bank and Trust Company deposit taking, that the Board has determined, by St. Paul, Minnesota regulation, to be permissible for a bank holding company under section 4(c)(8) of the Bank Holding Com- American Data Technology, Inc. pany Act.4 Company would provide data processing St. Paul, Minnesota services only to the extent permissible for bank holding companies under section 225.25(b)(7) of the Order Approving Investment in a Bank Service Board's Regulation Y, 12 C.F.R. § 225.25(b)(7). Corporation Section 5(c) of the BSCA, 12 U.S.C. § 1865(c), authorizes the Board, in acting upon applications to American National Bank and Trust Company, St. invest in or provide services as a bank service corpora- Paul, Minnesota ("Bank"), has applied for the tion, to consider the financial and managerial re- Board's approval under section 5(b) of the Bank sources of the institutions involved, their prospects, Service Corporation Act, as amended ("BSCA") and possible adverse effects, such as undue concentra- (12 U.S.C. § 1861 et seq.), to acquire all of the capital tion of resources, unfair or decreased competition, stock of a bank service corporation, American Data conflicts of interest, or unsafe or unsound banking Technology, Inc., St. Paul, Minnesota ("Company").1 practices. The Board finds that considerations relating In addition, Company has applied under section 5(b) to these factors are consistent with approval and that of the BSCA for permission to engage in an activity there is no evidence of adverse effects. that would be permissible for a bank holding company Accordingly, on the basis of the record, the applicaunder section 4(c)(8) of the Bank Holding Company tions are approved for the reasons summarized above. Act (12 U.S.C. § 1841 et seq.) and section 225.25 of This determination is subject to the Board's authority Regulation Y (12 C.F.R. § 225.25). Company pro- to require such modification or termination of the poses to provide data processing services, including activities of a bank service corporation as the Board check and deposit sorting and posting, computation finds necessary to assure compliance with the BSCA and posting of credits and charges, preparation and or to prevent evasions thereof. The transactions shall mailing of checks, statements, notices and similar be consummated within three months after the date of items, brokerage and leasing of computer hardware,2 this Order, unless such period is extended for good the sale of microcomputer software, and other clerical, cause by the Board or the Federal Reserve Bank of bookkeeping, accounting, statistical and similar func- Minneapolis. tions for which advanced computer technology may be By order of the Board of Governors, effective utilized. The services would be offered in Minnesota, November 27, 1984. North Dakota, South Dakota, Wisconsin, and Michigan, to depository institutions and other customers.3 Voting for this action: Vice Chairman Martin and Governors Partee, Rice, and Seger. Abstaining from this action: Governors Wallich and Gramley. Absent and not voting: Chairman Volcker. 1. Section 1(b)(2) of the BSCA (12 U.S.C. § 1861(b)(2)) defines a WILLIAM W. WILES bank service corporation as a corporation organized to perform [SEAL] Secretary of the Board services authorized by the BSCA, all of the capital stock of which is owned by one or more insured banks. 2. Bank states that Company's brokerage and leasing activities will be performed in conformance with the requirements of section 225.25(b)(7) of the Board's Regulation Y, including the 30 percent limitation contained therein with respect to general purpose hardware, equipment and other assets used in the provision of these services to and only to assist customers in purchasing and leasing equipment Company, which would serve existing correspondent bank customers necessary to facilitate the data processing services Company will as well as nonfinancial commercial customers. offer. 4. Under section 4(c)(8) of the Bank Holding Company Act, 3. Bank previously provided the proposed services directly to 12 U.S.C. § 1843(c)(8), a bank holding company may engage in correspondent banks in Michigan, Minnesota, North Dakota and activities determined by the Board to be closely related to banking and South Dakota. Under this proposal, Bank would be moving the a proper incident thereto. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 67 ORDERS APPROVED UNDER BANK HOLDING COMPANY ACT By the Board of Governors During November 1984 the Board of Governors approved the applications listed below. Copies are available upon request to Publications Services, Division of Support Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551 Section 3 Board action Applicant Bank (effective date) Giddings Bancshares, Inc., Allied First National Bank, November 15, 1984 Giddings, Texas Giddings, Texas Mammoth Bancorp, Inc., Brownsville Deposit Bank, November 6, 1984 Brownsville, Kentucky Brownsville, Kentucky Sections 3 and 4 Applicant Bank(s)/Nonbanking Effective Company date Midland Bank, pic, European American Bancorp, November 15, 1984 London, England New York, New York 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., Allied Bank Austin, Dallas October 25, 1984 Houston, Texas Austin, Texas Allied Bancshares, Inc., Allied Bank Northwest, N.A., Dallas October 31, 1984 Houston, Texas San Antonio, Texas Anchor Bancorp, Inc., Exchange State Bank, Minneapolis November 16, 1984 Wayzata, Minnesota St. Paul, Minnesota Arlington Bank Corporation, Arlington State Bank, Chicago November 15, 1984 Arlington, Indiana Arlington, Indiana Aurora Bancorporation, The Aurora Bank, Kansas City October 31, 1984 Aurora, Colorado Aurora, Colorado Austin Colony, Inc., First National Bank of Lake Dallas November 9, 1984 Lake Jackson, Texas Jackson, Lake Jackson, Texas Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Federal Reserve Bulletin • January 1985 Section 3—Continued Reserve Effective AApppplliiccaanntt BBaannkk((ss)) Bank date Benton Financial Corporation, Fowler State Bank, Chicago October 26, 1984 Fowler, Indiana Fowler, Indiana BSB Bancorp, Batesville State Bank, Chicago November 14, 1984 Batesville, Indiana Batesville, Indiana BW Bancshares, Inc., Bank of Warrensburg, Chicago November 9, 1984 Warrensburg, Illinois Warrensburg, Illinois Capital City Bank Group, Inc., Levy County Bancorporation, Atlanta November 16, 1984 Tallahassee, Florida Chiefland, Florida Carlisle Bancorp, Inc., Citizens Deposit Bank of Ar- St. Louis November 13, 1984 Arlington, Kentucky lington, Inc., Arlington, Kentucky CB&T Financial Corp., Stonewall National Bank, Richmond November 9, 1984 Fairmont, West Virginia Wston, West Virginia Clarksburg Community Bank, Clarksburg, West Virginia Chariton County Bancshares, Chariton County Bank, Kansas City November 8, 1984 Inc., Brunswick, Missouri Brunswick, Missouri Citizens Bancshares of Bates- The Citizens Bank, St. Louis November 13, 1984 ville, Inc., Batesville, Arkansas Bates ville, Arkansas Clintonville Bancshares, Inc., Dairyman's State Bank, Chicago November 9, 1984 Clintonville, Wisconsin Clintonville, Wisconsin Colorado National Bankshares, Longmont National Bankshares, Kansas City November 2, 1984 Inc., Inc., Denver, Colorado Longmont, Colorado The Longmont National Bank, Longmont, Colorado Commercial BancShares, Inc., Jackson County Bank, Richmond November 15, 1984 Parkersburg, West Virginia Ravenswood, West Virginia Community Bankshares Incor- Community Bank, Richmond November 15, 1984 porated, Petersburg, Virginia Petersburg, Virginia Comp One Corporation, The Piqua National Bank and Cleveland October 25, 1984 Piqua, Ohio Trust Company, Piqua, Ohio Congress National Bancshares, Congress National Bank, Dallas November 2, 1984 Inc., Austin, Texas Austin, Texas Consolidated Bancorporation, Volunteer Bank and Trust Com- Atlanta October 24, 1984 Inc., pany of Hamilton County, Chattanooga, Tennessee Chattanooga, Tennessee Coppell Financial Corporation, Coppell Bank, N.A., Dallas October 31, 1984 Dallas, Texas Dallas, Texas Cortland Bancorp., Cortland Savings and Banking Cleveland November 9, 1984 Cortland, Ohio Company, Cortland, Ohio Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 69 Section 3—Continued ,. . r. w \ Reserve Effective AApplicant Bank(s) Bank date Crockett Bancshares, Inc., Crockett State Bank, Dallas November 9, 1984 Crockett, Texas Crockett, Texas F. and M. Bancorp, of Tomah, Farmers & Merchants Bank, Chicago October 24, 1984 Inc., Tomah, Wisconsin Tomah, Wisconsin The Farmers Bancapital Corpo- The Farmers Bank, Kansas City November 1, 1984 ration, Carnegie, Oklahoma Carnegie, Oklahoma First American Bank Corpora- Meadowview Bancorp, Inc., Chicago November 2, 1984 tion, Chicago, Illinois Elk Grove Village, Illinois First Bancorp, Inc., First State Bank of Denton, Dallas October 26, 1984 Denton, Texas Denton, Texas First Evergreen Corporation, Clear Bancorp, Inc., Chicago November 9, 1984 Evergreen Park, Illinois Chicago, Illinois First Farmers Corporation of Farmers Bank and Trust Compa- St. Louis November 13, 1984 Madisonville, ny of Madisonville, Madisonville, Kentucky Madisonville, Kentucky First Houston Bancshares, Inc. Houston National Bank, Dallas November 16, 1984 Houston, Texas Houston, Texas First National Bancshares of The Huntington National Bank of Cleveland October 31, 1984 Nelsonville, Inc., Nelsonville, Nelsonville, Ohio Nelsonville, Ohio First Paintsville Bancshares, The First National Bank of Cleveland November 15, 1984 Inc., Paintsville, Paintsville, Kentucky Paintsville, Kentucky First Sheridan Bancshares, Inc. First National Bank of Sheridan, St. Louis October 30, 1984 Sheridan, Arkansas Sheridan, Arkansas First State Corporation, First State Bank in Cordele, Atlanta October 26, 1984 Albany, Georgia Cordele, Georgia First Winnebago Corporation, First National Bank of Chicago November 16, 1984 Winnebago, Illinois Winnebago, Winnebago, Illinois FNB Financial Services First National Bank of Reidsville, Richmond October 26, 1984 Corporation, FNB National Bank, Reidsville, North Carolina Reidsville, North Carolina Fort Knox Bancshares, Inc., Investors Services, Inc., St. Louis November 2, 1984 Chillicothe, Missouri Fort Knox, Kentucky Franklin Bancorp, Hillsborough National Bank, New York November 16, 1984 Somerset, New Jersey Belle Meade, New Jersey Houston Bancorporation, Inc., Citizens National Bank, Dallas November 14, 1984 Lake Jackson, Texas Houston, Texas Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Federal Reserve Bulletin • January 1985 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date Houston City Bancshares, Inc., Citizens National Bank-West, Dallas November 15, 1984 Houston, Texas Houston, Texas Inter Community Bancorp, Inter Community Bank, New York November 16, 1984 Springfield, New Jersey Springfield, New Jersey The International Commercial The Chinese American Bank, New York November 14, 1984 Bank of China, New York, New York Taiwan, Republic of China InvestArk Bankshares, Inc., First National Bank in Stuttgart, St. Louis November 2, 1984 Stuttgart, Arkansas Stuttgart, Arkansas Jack's Fork Bancorporation, Bank of Mountain View, St. Louis November 15, 1984 Inc., Mountain View, Missouri Columbia, Missouri Summersville Bancshares, Inc., Summersville, Missouri Jest, Inc., Peoples State Bank of Rexford, Kansas City October 16, 1984 Oakley, Kansas Rexford, Kansas Keystone Community Bancor- Keystone Savings Bank, Chicago November 16, 1984 poration, Keystone, Iowa Keystone, Iowa Landmark Bancshares, Inc., Landmark National Bank, Kansas City November 8, 1984 Denver, Colorado Denver, Colorado Lincoln Bancshares, Inc., Farmers State Bank, Atlanta October 25, 1984 Lincolnton, Georgia Lincolnton, Georgia Marshall Financial Corporation, Citizens Bank, St. Louis October 24, 1984 Byhalia, Mississippi Byhalia, Mississippi Meadowview Bancorp, Inc., First Bank of Meadowview, Chicago October 25, 1984 Chicago, Illinois Kankakee, Illinois The Merchants Bancorporation, The Merchants Bank and Trust New York November 14, 1984 Inc., Company, Norwalk, Connecticut Norwalk, Connecticut Metro Bancorp, Inc., The Commercial Bank, Atlanta October 26, 1984 Douglasville, Georgia Douglasville, Georgia Metropolitan Bancorp, United National Bank, Cleveland October 31, 1984 Lima, Ohio Convoy, Ohio Mid Continent Bancshares, Inc., Jacomo Bancshares, Inc., Kansas City November 8, 1984 Blue Springs, Missouri Blue Springs, Missouri Ray County Bancshares, Inc., Richmond, Missouri Midland Capital Co., ONB Bancorp, Inc., Kansas City October 23, 1984 Oklahoma City, Oklahoma Chickasha, Oklahoma Morton Financial Corporation, Morton Bancshares, Inc., Dallas November 8, 1984 Morton, Texas Morton, Texas National Bancshares Corpora- Uvalde Bancshares, Inc., Dallas November 7, 1984 tion of Texas, Uvalde, Texas San Antonio, Texas Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 71 Section 3—Continued Reserve Effective AApppplliiccaanntt BBaannkk((ss)) Bank date National Bankshares of National Bank of Fairbanks San Francisco November 15, 1984 La Jolla, Ranch, La Jolla, California Rancho Santa Fe, California New Era Bancorporation, Inc., New Era Bank, St. Louis November 6, 1984 Fredericktown, Missouri Fredericktown, Missouri Northern Kentucky Trustcorp, Northern Kentucky Bank & Cleveland November 15, 1984 Inc., Trust, Inc., Alexandria, Kentucky Alexandria, Kentucky Ocean National Corporation, The Ocean National Bank of Boston November 5, 1984 Kennebunk, Maine Kennebunk, Kennebunk, Maine Piano Bancshares, Inc., Community Bank of Piano, Chicago November 9, 1984 Piano, Illinois Piano, Illinois Pulaski Bancshares, Inc., State Bank of Dixon, St. Louis November 14, 1984 Dixon, Missouri Dixon, Missouri Rankin Commerce Corp., Rankin County Bank, Atlanta November 13, 1984 Brandon, Mississippi Brandon, Mississippi Rensselaer Financial Corpora- State Bank of Rensselaer, Chicago November 15, 1984 tion, Rensselaer, Indiana Rensselaer, Indiana Republic Bancshares, Inc., Republic Bank of Tecumseh, Kansas City October 10, 1984 Oklahoma City, Oklahoma Tecumseh, Oklahoma Rogers County Bank Holding Rogers County Bank, Kansas City November 5, 1984 Company, Claremore, Claremore, Oklahoma Oklahoma Saver's Bancorp, Inc., Belknap Bank & Trust, Boston November 9, 1984 Littleton, New Hampshire Belmont, New Hampshire Southern Bank Corp., Inc., The Southern Bank of Tallahas- Atlanta November 9, 1984 Tallahassee, Florida see, Tallahassee, Flordia State First Financial Corpora- The State First National Bank of St. Louis October 25, 1984 tion, Texarkana, Texarkana, Arkansas Texarkana, Arkansas Commercial Investment Company, Texarkana, Arkansas Texarkana National Bancshares, Texarkana National Bank-Central Dallas October 29, 1984 Inc., Plaza, Texarkana, Texas Texarkana, Texas Thomas Bancshares, Inc., The Bank of Thomas, Kansas City October 26, 1984 Thomas, Oklahoma Thomas, Oklahoma Wapello Bankshares, Inc., State Bank of Wapello, Chicago October 30, 1984 Wapello, Iowa Wapello, Iowa Waterville Bancshares, Inc., The Citizens State Bank of Kansas City October 23, 1984 Waterville, Kansas Waterville, Waterville, Kansas Woodstock Holding Company, The Woodstock National Bank, Boston October 24, 1984 Inc., Woodstock, Vermont Woodstock, Vermont Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Federal Reserve Bulletin • January 1985 Section 4 Nonbanking Reserve Effective Applicant company Bank date Barclays Bank PLC, London, Barclays Bank International New York November 14, 1984 London, England Limited, London, England Firstmark Corporation Buffalo, New York First Bank System, Inc., Bartels Agency, Inc., Minneapolis October 26, 1984 Minneapolis, Minnesota Butte, Montana First Railroad & Banking Com- E Z Loan Company, Inc., Atlanta October 29, 1984 pany, Chattanooga, Tennessee Augusta, Georgia Norstar Bancorp Inc., Chapdelaine & Co. Government New York November 2, 1984 Albany, New York Securities, Inc., New York, New York Sections 3 and 4 Bank(s)/Nonbanking Reserve Effective Applicant Company Bank date Chalfen Bankshares, Inc., First National Bank in Anoka, Minneapolis October 31, 1984 Minneapolis, Minnesota Anoka, Minnesota International Ice Group, London, England ORDERS APPROVED UNDER BANK MERGER ACT By Federal Reserve Banks . .. „ . , s Reserve Effective Applicant Bank(s) ^ fiank P.B.T. Bank, The Potters Bank & Trust Com- Cleveland November 16, 1984 East Liverpool, Ohio pany, East Liverpool, Ohio Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 73 PENDING CASES INVOLVING THE BOARD OF GOVERNORS This list of pending cases does not include suits against the Federal Reserve Banks in which the Board of Governor is not named a party. Citicorp v. Board of Governors, No. 84-445 (2d Cir., State of Ohio, v. Board of Governors, No. 84-1270 filed Oct. 12, 1984). (10th Cir., filed Jan. 30, 1984). David Bolger Revocable Trust v. Board of Governors, Ohio Deposit Guarantee Fund v. Board of Governors, No. 84-3550 (3rd Cir., filed Aug. 31, 1984). No. 84-1257 (10th Cir., filed Jan. 28, 1984). Citicorp v. Board of Governors, No. 84-4121 (2d Cir., Colorado Industrial Bankers Association v. Board of filed Aug. 27, 1984). Governors, No. 84-1122 (10th Cir., filed Jan. 27, Bank of New York Co., Inc. v. Board of Governors, 1984). No. 84-4091, (2d Cir., filed June 14, 1984). Financial Institutions Assurance Corp. v. Board of Citicorp v. Board of Governors, No. 84-4081 (2d Cir., Governors, No. 84-1101 (4th Cir., filed Jan. 27, filed May 22, 1984). 1984). Seattle Bancorporation v. Board of Governors, No. First Bancorporation v. Board of Governors, No. 84- 84-7535 (9th Cir., filed Aug. 15, 1984). 1011 (10th Cir., filed Jan. 5, 1984). Citicorp v. Board of Governors, No. 84-4081 (2d Cir., Dimension Financial Corporation v. Board of Goverfiled May 22, 1984). nors, No. 83-2696 (10th Cir., filed Dec. 30, 1983). Lamb v. Pioneer First Federal Savings and Loan Oklahoma Bankers Association v. Federal Reserve Association, No. C84-702 (D. Wash., filed May 8, Board, No. 83-2591 (10th Cir., filed Dec. 13, 1983). 1984). The Committee for Monetary Reform v. Board of Girard Bank v. Board of Governors, No. 84-3262 (3rd Governors, No. 84-5067 (D.C. Cir., filed June 16, Cir., filed May 2, 1984). 1983). Melcher v. Federal Open Market Committee, No. 84- Association of Data Processing Service Organiza- 1335 (D.D.C., filed, Apr. 30, 1984). tions, v. Board of Governors, No. 82-1910 (D.C. Florida Bankers Association v. Board of Governors, Cir., filed Aug. 16, 1982); and No. 82-2108 (D.C. No. 84-3269 and No. 84-3270 (11th Cir., filed Apr. Cir., filed Aug. 16, 1982). 20, 1984). Wolfson v. Board of Governors, No. 83-3570 (11th Northeast Bancorp, Inc. v. Board of Governors, No. Cir., filed Sept. 28, 1981). 84-363 (U.S., filed Mar. 27, 1984). First Bank & Trust Company v. Board of Governors, Huston v. Board of Governors, No. 84-1361 (8th Cir., No. 81-38 (E.D. Ky., filed Feb. 24, 1981). filed Mar. 20, 1984); and No. 84-1084 (8th Cir. filed 9 to 5 Organization for Women Office Workers v. Jan. 17, 1984). Board of Governors, No. 83-1171 (1st Cir., filed Dec. 30, 1980). Securities Industry Association v. Board of Governors, No. 80-2614 (D.C. Cir., filed Oct. 24. 1980), and No. 80-2730 (D.C. Cir., filed Oct. 24, 1980). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A1 Financial and Business Statistics CONTENTS WEEKLY REPORTING COMMERCIAL BANKS Assets and liabilities Domestic Financial Statistics A19 All reporting banks A20 Banks in New York City A21 Balance sheet memoranda MONEY STOCK AND BANK CREDIT A22 Branches and agencies of foreign banks A23 Gross demand deposits—individuals, A3 Reserves, money stock, liquid assets, and debt partnerships, and corporations measures A4 Reserves of depository institutions, Reserve Bank credit FINANCIAL MARKETS A5 Reserves and borrowings—Depository institutions A24 Commercial paper and bankers dollar A5 Federal funds and repurchase agreements— acceptances outstanding Large member banks A24 Prime rate charged by banks on short-term business loans A25 Terms of lending at commercial banks POLICY INSTRUMENTS A26 Interest rates—money and capital markets ALL Stock market—Selected statistics A6 Federal Reserve Bank interest rates A28 Selected financial institutions—Selected assets A7 Reserve requirements of depository institutions and liabilities A8 Maximum interest rates payable on time and savings deposits at federally insured institutions A9 Federal Reserve open market transactions FEDERAL FINANCE A30 Federal fiscal and financing operations FEDERAL RESERVE BANKS A31 U.S. budget receipts and outlays A32 Federal debt subject to statutory limitation A10 Condition and Federal Reserve note statements A32 Gross public debt of U.S. Treasury—Types and All Maturity distribution of loan and security ownership holdings A33 U.S. government securities dealers— Transactions A34 U.S. government securities dealers—Positions MONETAR Y AND CREDIT A GGREGA TES and financing A3 5 Federal and federally sponsored credit A12 Aggregate reserves of depository institutions agencies—Debt outstanding and monetary base A13 Money stock, liquid assets, and debt measures A15 Bank debits and deposit turnover A16 Loans and securities—All commercial banks COMMERCIAL BANKING INSTITUTIONS A17 Major nondeposit funds A18 Assets and liabilities, last-Wednesday-of-month series Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Federal Reserve Bulletin • January 1985 SECURITIES MARKETS AND International Statistics CORPORATE FINANCE S UMMAR Y ST A TIS TICS A36 New security issues—State and local governments and corporations A53 U.S. international transactions—Summary A37 Open-end investment companies—Net sales and A54 U.S. foreign trade asset position A54 U.S. reserve assets A37 Corporate profits and their distribution A54 Foreign official assets held at Federal Reserve A37 Nonfinancial corporations—Assets and Banks liabilities A55 Foreign branches of U.S. banks—Balance sheet A38 Total nonfarm business expenditures on new data plant and equipment A57 Selected U.S. liabilities to foreign official A38 Domestic finance companies—Assets and institutions liabilities and business credit REPORTED BY BANKS IN THE UNITED STATES REAL ESTATE A57 Liabilities to and claims on foreigners A39 Mortgage markets A58 Liabilities to foreigners A40 Mortgage debt outstanding A60 Banks' own claims on foreigners A61 Banks' own and domestic customers' claims on foreigners CONSUMER INSTALLMENT CREDIT A61 Banks' own claims on unaffiliated foreigners A62 Claims on foreign countries—Combined A41 Total outstanding and net change domestic offices and foreign branches A42 Terms REPORTED BY NONBANKING BUSINESS FLOW OF FUNDS ENTERPRISES IN THE UNITED STATES A43 Funds raised in U.S. credit markets A63 Liabilities to unaffiliated foreigners A44 Direct and indirect sources of funds to credit A64 Claims on unaffiliated foreigners markets SECURITIES HOLDINGS AND TRANSACTIONS Domestic Nonfinancial Statistics A65 Foreign transactions in securities SELECTED MEASURES A66 Marketable U.S. Treasury bonds and notes— Foreign holdings and transactions A45 Nonfinancial business activity—Selected measures A45 Labor force, employment, and unemployment INTEREST AND EXCHANGE RATES A46 Output, capacity, and capacity utilization A47 Industrial production—Indexes and gross value A67 Discount rates of foreign central banks A49 Housing and construction A67 Foreign short-term interest rates A50 Consumer and producer prices A68 Foreign exchange rates A51 Gross national product and income A52 Personal income and saving A69 Guide to Tabular Presentation, Statistical Releases, and Special Tables Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Money Stock and Bank Credit A3 1.10 RESERVES, MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES Monetary and credit aggregates (annual rates of change, seasonally adjusted in percent)1 IItteemm 1983 1984 1984 Q4 QL Q2 Q3 lune July Aug. Sept. Oct. Reserves of depository institutions2 1 Total .8' 7.6 8.5 6.8' 26.7 -1.5 4.6 -7.7' -12.4 2 Required .y 5.2 10.3 6.6' 21.0 3.5 2.3 -5.8' -12.0 3 Nonborrowed 8.2r 8.9 -10.8 -44.6' 18.2 -91. 7' -72.3' 21.0' 32.2 4 Monetary base3 7.8 9.3 7.1 7.3 11.8 5.6' 7.5' .1' 2.3 Concepts of money, liquid assets, and debt4 5 Ml 4.8 7.2 6.1 4.6 11.5 -1.3 1.5 5.9 -7.4 6 M2 8.5 6.9 6.8 6.1 7.2 4.9 4.7 7.9 6.0 7 M3 9.8 8.9 10.4 8.0 9.0 8.4 4.6 7.7 10.8 8 1. 8.8 11.2 10.2 12. 7' 14.8 12.4 n.a. n.a. n.a. 9 Debt 10.8 12.8 12.1 12.9 11.4 13.3 13.9 10.3 n.a. Nontransaction components 10 In M25 9.7 6.8 7.1 6.6 5.9 7.0 5.6 8.5 10.2 11 In M3 only6 15.8 17.5 24.6 15.5 16.6 22.5 4.4 6.9 29.3 Time and savings deposits Commercial banks 12 Savings7 -6.4 -16.2 -6.4 -5.6 -1.9 -5.6 -10.4 -3.8 -6.7 N Small-denomination time8 19.3 4.4 8.6 18.4 17.3 20.0 19.4 14.0 6.6 14 Large-denomination time910 -.2 10.0 24.2 21.2 29.0 26.0 1.9 11.7 19.6 Thrift institutions 15 Savings7 -4.4 -5.1 .5 -5.4 -.7 -8.1 -12.3 -2.1 -5.5 16 Small-denomination time 18.8 11.8 9.0 22.6 18.9 25.6 27.1 20.6 20.2 17 Large-denomination time9 58.1 59.0 46.4 35.1 54.3 42.7 20.6 -12.3 32.0 Debt components4 18 Federal 14.3 16.7 12.7 14.7 7.4 15.8 21.1 n.a. 11.4 19 Nonfederal 9.8' 11.7 12.9 12.4 12.6 12.5 11.8 n.a. 10.9 20 Total loans and securities at commercial banks" 10.2 14.0 10.0 7.5 1.7 8.7 8.2 7.3' 7.6 1. Unless otherwise noted, rates of change are calculated from average funds (general purpose and broker/dealer), foreign governments and commercial amounts outstanding in preceding month or quarter. banks, and the U.S. government. Also subtracted is a consolidation adjustment 2. Figures incorporate afljustments for discontinuities associated with the that represents the estimated amount of demand deposits and vault cash held by implementation of the Monetary Control Act and other regulatory changes to thrift institutions to service their time and savings deposits. reserve requirements. To adjust for discontinuities due to changes in reserve M3: M2 plus large-denomination time deposits and term RP liabilities (in requirements on reservable nondeposit liabilities, the sum of such required amounts of $100,000 or more) issued by commercial banks and thrift institutions, reserves is subtracted from the actual series. Similarly, in adjusting for discontin- term Eurodollars held by U.S. residents at foreign branches of U.S. banks uities in the monetary base, required clearing balances and adjustments to worldwide and at all banking offices in the United Kingdom and Canada, and compensate for float also are subtracted from the actual series. balances in both taxable and tax-exempt, institution-only money market mutual 3. The monetary base not adjusted for discontinuities consists of total funds. Excludes amounts held by depository institutions, the U.S. government, reserves plus required clearing balances and adjustments to compensate for float money market funds, and foreign banks and official institutions. Also subtracted is at Federal Reserve Banks plus the currency component of the money stock less a consolidation adjustment that represents the estimated amount of overnight RPs the amount of vault cash holdings of thrift institutions that is included in the and Eurodollars held by institution-only money market mutual funds. currency component of the money stock plus, for institutions not having required L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term reserve balances, the excess of current vault cash over the amount applied to Treasury securities, commercial paper and bankers acceptances, net of money satisfy current reserve requirements. After the introduction of contemporaneous market mutual fund holdings of these assets. reserve requirements (CRR), currency and vault cash figures are measured over Debt: Debt of domestic nonfinancial sectors consists of outstanding credit the weekly computation period ending Monday. market debt of the U.S. government, state and local governments, and private Before CRR, all components of the monetary base other than excess reserves nonfinancial sectors. Private debt consists of corporate bonds, mortgages, conare seasonally adjusted as a whole, rather than by component, and excess sumer credit (including bank loans), other bank loans, commercial paper, bankers reserves are added on a not seasonally adjusted basis. After CRR, the seasonally acceptances, and other debt instruments. The source of data on domestic adjusted series consists of seasonally adjusted total reserves, which include nonfinancial debt is the Federal Reserve Board's flow of funds accounts. Debt excess reserves on a not seasonally adjusted basis, plus the seasonally adjusted data are on an end-of-month basis. Growth rates for debt reflect adjustments for currency component of the money stock plus the remaining items seasonally discontinuities over time in the levels of debt presented in other tables. adjusted as a whole. 5. Sum of overnight RPs and Eurodollars, money market fund balances 4. Composition of the money stock measures and debt is as follows: (general purpose and broker/dealer), MMDAs, and savings and small time Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults deposits less the estimated amount of demand deposits and vault cash held by of commercial banks; (2) travelers checks of nonbank issuers; (3) demand deposits thrift institutions to service their time and savings deposit liabilities. at all commercial banks other than those due to domestic banks, the U.S. 6. Sum of large time deposits, term RPs, and Eurodollars of U.S. residents, government, and foreign banks and official institutions less cash items in the money market fund balances (institution-only), less a consolidation adjustment process of collection and Federal Reserve float; and (4) other checkable deposits that represents the estimated amount of overnight RPs and Eurodollars held by (OCD) consisting of negotiable order of withdrawal (NOW) and automatic transfer institution-only money market mutual funds. service (ATS) accounts at depository institutions, credit union share draft 7. Excludes MMDAs. accounts, and demand deposits at thrift institutions. The currency and demand 8. Small-denomination time deposits—including retail RPs—are those issued deposit components exclude the estimated amount of vault cash and demand in amounts of less than $100,000. All IRA and Keogh accounts at commercial deposits respectively held by thrift institutions to service their OCD liabilities. banks and thrifts are subtracted from small time deposits. M2: Ml plus overnight (and continuing contract) repurchase agreements (RPs) 9. Large-denomination time deposits are those issued in amounts of $100,000 issued by all commercial banks and overnight Eurodollars issued to U.S. residents or more, excluding those booked at international banking facilities. by foreign branches of U.S. banks worldwide, MMDAs, savings and small- 10. Large-denomination time deposits at commercial banks less those held by denomination time deposits (time deposits—including retail RPs—in amounts of money market mutual funds, depository institutions, and foreign banks and less than $100,000), and balances in both taxable and tax-exempt general purpose official institutions. and broker/dealer money market mutual funds. Excludes individual retirement 11. Changes calculated from figures shown in table 1.23. Beginning December accounts (IRA) and Keogh balances at depository institutions and money market 1981, growth rates reflect shifts of foreign loans and securities from U.S. banking funds. Also excludes all balances held by U.S. commercial banks, money market offices to international banking facilities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A4 Domestic Nonfinancial Statistics • January 1985 1.11 RESERVES OF DEPOSITORY INSTITUTIONS AND RESERVE BANK CREDIT Millions of dollars Monthly averages of daily figures Weekly averages of daily figures for week ending FFFaaaccctttooorrrsss 1984 1984 Aug. Sept. Oct. Sept. 19 Sept. 26 Oct. 3 Oct. 10 Oct. 17 Oct. 24 Oct. 31 SSSSSUUUUUPPPPPPPPPPLLLLLYYYYYIIIIINNNNNGGGGG RRRRREEEEESSSSSEEEEERRRRRVVVVVEEEEE FFFFFUUUUUNNNNNDDDDDSSSSS 11111 RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkk cccccrrrrreeeeedddddiiiiittttt 175,604 179,643 177,114 178,922 180,950 181,066 178,283 177,882 175,166 176,159 22222 UUUUU.....SSSSS..... gggggooooovvvvveeeeerrrrrnnnnnmmmmmeeeeennnnnttttt ssssseeeeecccccuuuuurrrrriiiiitttttiiiiieeeeesssss11111 150,145 154,137 149,686 153,650 156,106 153,866 150,966 148,833 148,166 149,457 33333 BBBBBooooouuuuuggggghhhhhttttt ooooouuuuutttttrrrrriiiiiggggghhhhhttttt 149,890 152,532 149,686 152,579 154,044 153,866 150,966 148,833 148,166 149,457 44444 HHHHHeeeeelllllddddd uuuuunnnnndddddeeeeerrrrr rrrrreeeeepppppuuuuurrrrrccccchhhhhaaaaassssseeeee aaaaagggggrrrrreeeeeeeeeemmmmmeeeeennnnntttttsssss.................... 255 1,605 0 1,071 2,062 0 0 0 0 0 55555 FFFFFeeeeedddddeeeeerrrrraaaaalllll aaaaagggggeeeeennnnncccccyyyyy ooooobbbbbllllliiiiigggggaaaaatttttiiiiiooooonnnnnsssss 8,512 8,674 8,484 8,679 8,724 8,493 8,492 8,482 8,479 8,479 66666 BBBBBooooouuuuuggggghhhhhttttt ooooouuuuutttttrrrrriiiiiggggghhhhhttttt 8,494 8,493 8,484 8,493 8,493 8,493 8,492 8,482 8,479 8,479 77777 HHHHHeeeeelllllddddd uuuuunnnnndddddeeeeerrrrr rrrrreeeeepppppuuuuurrrrrccccchhhhhaaaaassssseeeee aaaaagggggrrrrreeeeeeeeeemmmmmeeeeennnnntttttsssss.................... 18 181 0 186 231 0 0 0 0 0 88888 AAAAAcccccccccceeeeeppppptttttaaaaannnnnccccceeeeesssss 0 0 0 0 0 0 0 0 0 0 99999 LLLLLoooooaaaaannnnnsssss 8,095 7,251 5,940 7,323 6,896 6,173 6,157 6,822 5,645 5,187 1111100000 FFFFFllllloooooaaaaattttt 417 462 820 779 -113 418 550 1,451 679 557 1111111111 OOOOOttttthhhhheeeeerrrrr FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee aaaaasssssssssseeeeetttttsssss 8,435 9,119 12,184 8,491 9,337 12,116 12,119 12,295 12,198 12,478 1111122222 GGGGGooooolllllddddd ssssstttttoooooccccckkkkk 11,099 11,098 11,097 11,098 11,097 11,097 11,097 11,097 11,097 11,096 1111133333 SSSSSpppppeeeeeccccciiiiiaaaaalllll dddddrrrrraaaaawwwwwiiiiinnnnnggggg rrrrriiiiiggggghhhhhtttttsssss ccccceeeeerrrrrtttttiiiiifffffiiiiicccccaaaaattttteeeee aaaaaccccccccccooooouuuuunnnnnttttt 4,618 4,618 4,618 4,618 4,618 4,618 4,618 4,618 4,618 4,618 1111144444 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy cccccuuuuurrrrrrrrrreeeeennnnncccccyyyyy ooooouuuuutttttssssstttttaaaaannnnndddddiiiiinnnnnggggg 16,186 16,219 16,266 16,221' 16,232' 16,239 16,251 16,263 16,275 16,286 AAAAABBBBBSSSSSOOOOORRRRRBBBBBIIIIINNNNNGGGGG RRRRREEEEESSSSSEEEEERRRRRVVVVVEEEEE FFFFFUUUUUNNNNNDDDDDSSSSS 1111155555 CCCCCuuuuurrrrrrrrrreeeeennnnncccccyyyyy iiiiinnnnn ccccciiiiirrrrrcccccuuuuulllllaaaaatttttiiiiiooooonnnnn 176,182 176,436 176,560 176,559' 175,346' 175,628 177,025 177,244 176,387 175,857 1111166666 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy cccccaaaaassssshhhhh hhhhhooooollllldddddiiiiinnnnngggggsssss 475 465 474 465 465 465 474 475 475 475 DDDDDeeeeepppppooooosssssiiiiitttttsssss,,,,, ooooottttthhhhheeeeerrrrr ttttthhhhhaaaaannnnn rrrrreeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaalllllaaaaannnnnccccceeeeesssss,,,,, wwwwwiiiiittttthhhhh FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss 1111177777 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy 3,528 6,117 4,021 5,602 8,410 7,742 4,642 3,702 3,136 3,803 1111188888 FFFFFooooorrrrreeeeeiiiiigggggnnnnn 215 234 226 252 236 231 229 216 213 237 1111199999 SSSSSeeeeerrrrrvvvvviiiiiccccceeeee-----rrrrreeeeelllllaaaaattttteeeeeddddd bbbbbaaaaalllllaaaaannnnnccccceeeeesssss aaaaannnnnddddd aaaaadddddjjjjjuuuuussssstttttmmmmmeeeeennnnntttttsssss .................... 1,462 1,339 1,483 1,346 1,353 1,452 1,428 1,349 1,395 1,906 2222200000 OOOOOttttthhhhheeeeerrrrr 339 476 348 580 432 423 405 355 287 286 2222211111 OOOOOttttthhhhheeeeerrrrr FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee llllliiiiiaaaaabbbbbiiiiillllliiiiitttttiiiiieeeeesssss aaaaannnnnddddd cccccaaaaapppppiiiiitttttaaaaalllll 5,987 6,253 6,195 6,269 6,320 6,066 6,155 6,307 6,228 6,172 2222222222 RRRRReeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaalllllaaaaannnnnccccceeeeesssss wwwwwiiiiittttthhhhh FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss22222 19,321 20,258 19,789 19,786 20,334 21,011 19,892 20,214 19,035 19,422 End-of-month figures Wednesday figures 1984 1984 Aug. Sept. Oct. Sept. 19 Sept. 26 Oct. 3 Oct. 10 Oct. 17 Oct. 24 Oct. 31 SSSSSUUUUUPPPPPPPPPPLLLLLYYYYYIIIIINNNNNGGGGG RRRRREEEEESSSSSEEEEERRRRRVVVVVEEEEE FFFFFUUUUUNNNNNDDDDDSSSSS 2222233333 RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkk cccccrrrrreeeeedddddiiiiittttt 178,938 182,641 174,892 182,600 179,737 179,356 178,558 179,104 173,495 174,892 2222244444 UUUUU.....SSSSS..... gggggooooovvvvveeeeerrrrrnnnnnmmmmmeeeeennnnnttttt ssssseeeeecccccuuuuurrrrriiiiitttttiiiiieeeeesssss''''' 153,183 155,018 148,220 156,630 153,748 152,435 147,432 150,419 147,877 148,220 2222255555 BBBBBooooouuuuuggggghhhhhttttt ooooouuuuutttttrrrrriiiiiggggghhhhhttttt 148,356 155,018 148,220 152,332 153,480 152,435 147,432 150,419 147,877 148,220 2222266666 HHHHHeeeeelllllddddd uuuuunnnnndddddeeeeerrrrr rrrrreeeeepppppuuuuurrrrrccccchhhhhaaaaassssseeeee aaaaagggggrrrrreeeeeeeeeemmmmmeeeeennnnntttttsssss.................... 4,827 0 0 4,298 268 0 0 0 0 0 2222277777 FFFFFeeeeedddddeeeeerrrrraaaaalllll aaaaagggggeeeeennnnncccccyyyyy ooooobbbbbllllliiiiigggggaaaaatttttiiiiiooooonnnnnsssss 8,863 8,493 8,479 9,042 8,519 8,493 8,484 8,479 8,479 8,479 2222288888 BBBBBooooouuuuuggggghhhhhttttt ooooouuuuutttttrrrrriiiiiggggghhhhhttttt 8,494 8,493 8,479 8,493 8,493 8,493 8,484 8,479 8,479 8,479 2222299999 HHHHHeeeeelllllddddd uuuuunnnnndddddeeeeerrrrr rrrrreeeeepppppuuuuurrrrrccccchhhhhaaaaassssseeeee aaaaagggggrrrrreeeeeeeeeemmmmmeeeeennnnntttttsssss.................... 369 0 0 549 26 0 0 0 0 0 3333300000 AAAAAcccccccccceeeeeppppptttttaaaaannnnnccccceeeeesssss 0 0 0 0 0 0 0 0 0 0 3333311111 LLLLLoooooaaaaannnnnsssss 8,276 6,633 5,060 7,683 4,786 5,711 5,809 6,425 5,164 5,060 3333322222 FFFFFllllloooooaaaaattttt 326 289 658 465 165 578 4,408 1,580 -602 658 3333333333 OOOOOttttthhhhheeeeerrrrr FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee aaaaasssssssssseeeeetttttsssss 8,290 12,208 12,475 8,780 12,519 12,139 12,425 12,201 12,577 12,475 3333344444 GGGGGooooolllllddddd ssssstttttoooooccccckkkkk 11,098 11,097 11,096 11,098 11,097 11,097 11,097 11,097 11,096 11,096 3333355555 SSSSSpppppeeeeeccccciiiiiaaaaalllll dddddrrrrraaaaawwwwwiiiiinnnnnggggg rrrrriiiiiggggghhhhhtttttsssss ccccceeeeerrrrrtttttiiiiifffffiiiiicccccaaaaattttteeeee aaaaaccccccccccooooouuuuunnnnnttttt ............... 4,618 4,618 4,618 4,618 4,618 4,618 4,618 4,618 4,618 4,618 3333366666 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy cccccuuuuurrrrrrrrrreeeeennnnncccccyyyyy ooooouuuuutttttssssstttttaaaaannnnndddddiiiiinnnnnggggg 16,220 16,237' 16,295 16,231' 16,237' 16,249 16,261 16,273 16,285 16,295 AAAAABBBBBSSSSSOOOOORRRRRBBBBBIIIIINNNNNGGGGG RRRRREEEEESSSSSEEEEERRRRRVVVVVEEEEE FFFFFUUUUUNNNNNDDDDDSSSSS 3333377777 CCCCCuuuuurrrrrrrrrreeeeennnnncccccyyyyy iiiiinnnnn ccccciiiiirrrrrcccccuuuuulllllaaaaatttttiiiiiooooonnnnn 176,852 175,34C 176,300 176,118' 175,394' 176,299 177,775 177,066 176,122 176,300 3333388888 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy cccccaaaaassssshhhhh hhhhhooooollllldddddiiiiinnnnngggggsssss 465 465 482 465 47 <y 465 474 472 475 482 DDDDDeeeeepppppooooosssssiiiiitttttsssss,,,,, ooooottttthhhhheeeeerrrrr ttttthhhhhaaaaannnnn rrrrreeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaalllllaaaaannnnnccccceeeeesssss wwwwwiiiiittttthhhhh FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss 3333399999 TTTTTrrrrreeeeeaaaaasssssuuuuurrrrryyyyy 4,029 8,514 3,791 11,710 8,814 5,396 3,144 4,188 2,971 3,791 4444400000 FFFFFooooorrrrreeeeeiiiiigggggnnnnn 242 206 270 261 196 250 246 259 194 270 4444411111 SSSSSeeeeerrrrrvvvvviiiiiccccceeeee-----rrrrreeeeelllllaaaaattttteeeeeddddd bbbbbaaaaalllllaaaaannnnnccccceeeeesssss aaaaannnnnddddd aaaaadddddjjjjjuuuuussssstttttmmmmmeeeeennnnntttttsssss .................... 1,147 1,139 1,132 1,155 1,155 1,139 1,139 1,143 1,142 1,132 4444422222 OOOOOttttthhhhheeeeerrrrr 413 383 321 490 402 431 429 318 275 321 4444433333 OOOOOttttthhhhheeeeerrrrr FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee llllliiiiiaaaaabbbbbiiiiillllliiiiitttttiiiiieeeeesssss aaaaannnnnddddd cccccaaaaapppppiiiiitttttaaaaalllll 6,140 6,073 5,997 6,213 6,068 5,796 6,146 6,110 6,037 5,997 4444444444 RRRRReeeeessssseeeeerrrrrvvvvveeeee bbbbbaaaaalllllaaaaannnnnccccceeeeesssss wwwwwiiiiittttthhhhh FFFFFeeeeedddddeeeeerrrrraaaaalllll RRRRReeeeessssseeeeerrrrrvvvvveeeee BBBBBaaaaannnnnkkkkksssss22222 21,586 22,473 18,608 18,135 19,190 21,544 21,182 21,536 18,279 18,608 1. Includes securities loaned—fully guaranteed by U.S government securities 2. Excludes required clearing balances and adjustments to compensate for pledged with Federal Reserve Banks—and excludes (if any) securities sold and float. scheduled to be bought back under matched sale-purchase transactions. NOTE. For amounts of currency and coin held as reserves, see table 1.12. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Money Stock and Bank Credit A5 1.12 RESERVES AND BORROWINGS Depository Institutions Millions of dollars Monthly averages8 RReesseerrvvee ccllaassssiiffiiccaattiioonn 1981 1982 1983 1984 Dec. Dec. Dec. Apr. May June July Aug. Sept/ Oct. 1 Reserve balances with Reserve Banks' 26,163 24,804 20,986 20,351 19,560 20,210 19,885 19,263 20,135 20,088 2 Total vault cash2 19,538 20,392 20,755 20,152 20,446 20,770 21,134 21,688 21,232 21,875 3 Vault cash used to satisfy reserve requirements3 . 15,755 17,049 17,908 16,802 16,960 17,308 17,579 17,995 17,900 18,413 4 Surplus vault cash4 3,783 3,343 2,847 3,349 3,486 3,461 3,555 3,694 3,333 3,462 5 Total reserves3 41,918 41,853 38,894 37,154 36,519 37,518 37,464 37,258 38,035 38,501 6 Required reserves 41,606 41,353 38,333 36,664 35,942 36,752 36,858 36,575 37,415 37,893 7 Excess reserve balances at Reserve Banks6 312 500 561 490 577 767 607 683 620 608 8 Total borrowings at Reserve Banks 642 697 774 1,234 2,988 3,300 5,924 8,017 7,242 6,017 9 Seasonal borrowings at Reserve Banks 53 33 96 139 196 264 308 346 319 299 10 Extended credit at Reserve Banks7 149 187 2 44 37 1,873 5,008 7,043 6,459 5,057 Biweekly averages of daily figures for weeks ending 1984 July 4 July 18 Aug. 1 Aug. 15 Aug. 29 Sept. 12 Sept. 26 Oct. 10 Oct. 24 Nov. 7 11 Reserve balances with Reserve Banks1 20,189 20,546 19,079 19,690 18,722 20,158 20,038 20,406 19,617 20,574 12 Total vault cash2 21,121 20,708 21,597 21,533 21,981 20,782 21,522 21,571 22,329 21,404 13 Vault cash used to satisfy reserve requirements3 . 17,513 17,404 17,789 17,923 18,166 17,405 18,232 18,221 18,784 17,949 14 Surplus vault cash4 3,608 3,304 3,808 3,610 3,815 3,377 3,290 3,350 3,545 3,456 15 Total reserves5 37,702 37,950 36,868 37,613 36,887 37,563 38,270 38,627 38,400 38,523 16 Required reserves 36,645 37,499 36,233 36,914 36,211 36,929 37,744 37,723 37,984 37,954 17 Excess reserve balances at Reserve Banks6 1,058 451 635 699 677 634 527 904 416 569 18 Total borrowings at Reserve Banks 3,909 5,358 7,155 7,987 8,146 7,755 7.110 6,165 6,234 5,373 19 Seasonal borrowings at Reserve Banks 289 284 340 338 360 309 328 315 305 265 20 Extended credit at Reserve Banks7 2,846 4,614 6,098 6,976 7,184 7,001 6,369 5,147 5,431 4,187 1. Excludes required clearing balances and adjustments to compensate for computation period by institutions having required reserve balances at Federal float. Reserve Banks plus the amount of vault cash equal to required reserves during the 2. Dates refer to the maintenance periods in which the vault cash can be used to maintenance period at institutions having no required reserve balances. satisfy reserve requirements. Under contemporaneous reserve requirements, 6. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy maintenance periods end 30 days after the lagged computation periods in which reserve requirements less required reserves. the balances are held. 7. Extended credit consists of borrowing at the discount window under the 3. Equal to all vault cash held during the lagged computation period by terms and conditions established for the extended credit program to help institutions having required reserve balances at Federal Reserve Banks plus the depository institutions deal with sustained liquidity pressures. Because there is amount of vault cash equal to required reserves during the maintenance period at not the same need to repay such borrowing promptly as there is with traditional institutions having no required reserve balances. short-term adjustment credit, the money market impact of extended credit is 4. Total vault cash at institutions having no required reserve balances less the similar to that of nonborrowed reserves. amount of vault cash equal to their required reserves during the maintenance 8. Before February 1984, data are prorated monthly averages of weekly period. averages; beginning February 1984, data are prorated monthly averages of 5. Total reserves not adjusted for discontinuities consist of reserve balances biweekly averages. with Federal Reserve Banks, which exclude required clearing balances and NOTE. These data also appear in the Board's H.3 (502) release. For address, see adjustments to compensate for float, plus vault cash used to satisfy reserve inside front cover. requirements. Such vault cash consists of all vault cash held during the lagged 1.13 FEDERAL FUNDS AND REPURCHASE AGREEMENTS Large Member Banks1 Averages of daily figures, in millions of dollars 1984 week ending Monday BByy mmaattuurriittyy aanndd ssoouurrccee Sept. 24 Oct. 1 Oct. 8 Oct. 15 Oct. 22 Oct. 29 Nov. 5 Nov. 12 Nov. 19 One day and continuing contract 1 Commercial banks in United States 56,625 54,888 61,252 61,830 58,666 55,512 62,538 65,520 63,478 2 Other depository institutions, foreign banks and foreign official institutions, and U.S. government agencies . 24,865 23,998 24,649 25,128 26,160 25,391 27,218 29,396 29,239' 3 Nonbank securities dealers 4,109 3,758 3,901 4,965 4,856 5,195 6,420 6,045 6,498 4 All other 27,082 26,926 26,210 25,751 26,481 26,717 27,833 27,548 28,937 All other maturities 5 Commercial banks in United States 9,496 9,468 9,345 9,766 9,691 9,661 9,527 9,516 8,677 6 Other depository institutions, foreign banks and foreign official institutions, and U.S. government agencies . 8,972 9,034 9,587 9,138 8,532 8,266 8,118 8,083 7,716 7 Nonbank securities dealers 6,732 6,576 6,841 6,762 7,187 7,580 7,261 7,014 6,574 8 All other 10,885 10,706 10,458 10,588 10,904 11,128 11,519 12,487 10,342 MEMO: Federal funds and resale agreement loans in maturities of one day or continuing contract 9 Commercial banks in United States 26,809 26,947 28,013 28,777 28,594' 28,125 32,333 31,489 30,484 10 Nonbank securities dealers 4,906 5,037 5,259 5,432 4,864 5,284 6,343 5,907 5,520 1. Banks with assets of $1 billion or more as of Dec. 31, 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A6 DomesticN onfinancial Statistics • January 1985 1.14 FEDERAL RESERVE BANK INTEREST RATES Percent per annum Current and previous levels Extended credit1 SShhoorrtt--tteerrmm aaddjjuussttmmeenntt ccrreeddiitt FFFeeedddeeerrraaalll RRReeessseeerrrvvveee aanndd sseeaassoonnaall ccrreeddiitt First 60 days Next 90 days BBBaaannnkkk of borrowing of borrowing After 150 days EEffffeeccttiivvee ddaattee ffoorr ccuurrrreenntt rraatteess Rate on Effective Previous Rate on Previous Rate on Previous Rate on Previous 11/30/84 date rate 11/30/84 rate U/30/84 rate 11/30/84 rate Boston 8V2 11/23/84 9 81/5 9 9'/2 10 101/2 11 11/23/84 New York 11/21/84 11/21/84 Philadelphia 11/21/84 11/21/84 Cleveland 11/26/84 11/26/84 Richmond 11/21/84 11/21/84 Atlanta 11/23/84 11/23/84 Chicago 11/21/84 11/21/84 St. Louis 11/21/84 11/21/84 Minneapolis 11/21/84 11/21/84 Kansas City .... 11/21/84 11/21/84 D Sa a n l la F s rancisco... 8'/2 1 1 1 1 / / 2 2 1 1 / / 8 8 4 4 9 8'/2 9 9</z 10 IQ'/z 1 1 1 1 1 / / 2 2 1 1/ / 8 8 4 4 Range of rates in recent years2 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 A le l v l el F > . — R. Ba o n f k Effective date A le l v l e F l) . — R. Ba of n k Banks N.Y. Banks N.Y. Banks N.Y. I 11 n 99 77 e 44 f —— fec t AA D pprr e .. c . 2 3 5 0 3 1, 1973 71 7 8 / 1 2 /2 -8 7 8 8 ' /2 1978--- A JJuu u ll g yy . 2 1 1 3 0 77 7 -71 3 / / 'A4 4 7 7 7 V 1 % /4 4 1981-• N M o a v y . 2 8 5 1 1 3 3 1 - - 4 1 1 4 4 1 1 1 4 4 3 Dec. 9 73/4-8 73/4 Sept. 22 8 8 6 13 13 16 73/4 73/4 Oct. 16 8-8'/2 8mV2 Dec. 4 12 12 1975— Jan. 2 1 4 6 0 7 7 ' ! / / 4 7 4 ' - - / 7 7 4 3 3 / / 4 4 7 7 7 1 3 1 / / / 4 4 4 Nov. 20 3 1 SV8 9' ' / /2 2 2 -W2 9 9 '/ V > 2 •J A u u ly g . 2 2 0 2 3 1 ll 1 '/ 1 - 2 1 1 1 - '/ 1 V 2 2 2 1l 1 l1 1 '1// 22 F M e a b r . . 1 5 7 0 6 63 V / 6 4 4 3 - - / 6 7 4 ! V / 4 4 6 6 6 3 3 !/ / / 4 4 4 1979--Ju AA l uu y gg .. 2 2 1 0 0 7 \01 10 -0 1 W /2 l 1 1100 0 1' //22 2 1 7 3 6 10 1 - 0 1 1 1 1 0 /2 '/ 2 1 1 10 0 1 '/ 2 14 61/4 61/4 SSeepptt.. 19 10'/2-l 1 11 30 10 10 MMaayy 16 6-61/4 6 21 11 11 Oct. 12 91/2-10 91/2 23 6 6 Oct. 8 11-12 12 13 91/2 91/2 10 12 12 Nov. 22 9-9'/2 9 1976— N Ja o n v . . 2 2 2 1 6 3 2 9 5 5 '/ 1 5 5 4 / 1 1 — 2 / / 4 - 2 5 6 1 /5 5 5 5 5 1 1 1 '/ / / / 4 2 2 4 1980-- MM Fe aa b yy . 2 1 1 9 5 9 1 1 2 2 1 - - 3 1 1 3 3 1 1 1 3 3 3 Dec. 1 2 1 1 4 6 7 5 8 8V 1 8' / / 2 92 2 - - 9 9 9 9 S 81 V /2 2 30 12 12 11997777—— AAuugg.. 30 5i/4-53/4 51/4 June 13 11-12 11 • Apr. 9 8>/2-9 9 31 5'/4-53/4 53/4 16 11 11 13 9 9 Sept. 2 53/4 53/4 July 28 10-11 10 Nov. 21 81/2-9 8'/2 Oct. 26 6 6 29 10 10 26 Sept. 26 11 11 1978— Jan. 9 6-6'/2 6'/2 Nov. 17 12 12 20 61/2 6'/2 Dec. 5 12-13 13 May 11 61/2-7 7 8 13 13 12 7 7 In effect Nov. 30, 1984 81/2 81/2 1. Applicable to advances when exceptional circumstances or practices involve Statistics, 1914-1941, and 1941-1970; Annual Statistical Digest, 1970-1979, 1980, only a particular depository institution and to advances when an institution is 1981, and 1982. under sustained liquidity pressures. As an alternative, for loans outstanding for In 1980 and 1981, the Federal Reserve applied a surcharge to short-term more than 150 days, a Federal Reserve Bank may charge a flexible rate that takes adjustment credit borrowings by institutions with deposits of $500 million or more into account rates on market sources of funds, but in no case will the rate charged that had borrowed in successive weeks or in more than 4 weeks in a calendar be less than the basic rate plus one percentage point. Where credit provided to a quarter. A 3 percent surcharge was in effect from Mar. 17, 1980, through May 7, particular depository institution is anticipated to be outstanding for an unusually 1980. There was no surcharge until Nov. 17, 1980, when a 2 percent surcharge was prolonged period and in relatively large amounts, the time period in which each adopted; the surcharge was subsequently raised to 3 percent on Dec. 5, 1980, and rate under this structure is applied may be shortened. See section 201.3(b)(2) of to 4 percent on May 5, 1981. The surcharge was reduced to 3 percent effective Regulation A. Sept. 22, 1981, and to 2 percent effective Oct. 12. As of Oct. 1, the formula for 2. Rates for short-term adjustment credit. For description and earlier data see applying the surcharge was changed from a calendar quarter to a moving 13-week the following publications of the Board of Governors: Banking and Monetary period. The surcharge was eliminated on Nov. 17, 1981. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A7 1.15 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS1 Percent of deposits Member bank requirements Depository institution requirements before implementation of the after implementation of the TTyyppee ooff ddeeppoossiitt,, aanndd Monetary Control Act TTyyppee ooff ddeeppoossiitt,, aanndd Monetary Control Act6 ddeeppoossiitt iinntteerrvvaall ddeeppoossiitt iinntteerrvvaall55 Percent Effective date Percent Effective date Net demand2 Net transaction accounts7,8 7 12/30/76 $0-$28.9 million 3 12/29/83 9'/2 12/30/76 Over $28.9 million 1122 1122//2299//8833 $10 million-$100 million 113/4 12/30/76 $100 million-$400 million 123/4 12/30/76 Nonpersonal time deposits9 Over $400 million I6V4 12/30/76 By original maturity Less than l'/2 years 3 10/6/83 Time and savings2^ 11/2 years or more 0 10/6/83 Savings 3 3/16/67 Eurocurrency liabilities Time4 AAllll ttyyppeess 3 11/13/80 $0 million-$5 million, by maturity 30-179 days 3 3/16/67 180 days to 4 years 2Vi 1/8/76 4 years or more 1 10/30/75 Over $5 million, by maturity 30-179 days 6 12/12/74 180 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 week of May 14-21, 1980. In addition, beginning Mar. 19, 1980, the base was Statistical Digest, 1971-1975, and for prior changes, see Board's Annual Report reduced to the extent that foreign loans and balances declined. for 1976, table 13. Under provisions of the Monetary Control Act, depository 5. The Garn-St Germain Depository Institutions Act of 1982 (Public Law 97institutions include commercial banks, mutual savings banks, savings and loan 320) provides that $2 million of reservable liabilities (transaction accounts, associations, credit unions, agencies and branches of foreign banks, and Edge Act nonpersonal time deposits, and Eurocurrency liabilities) of each depository corporations. institution be subject to a zero percent reserve requirement. The Board is to adjust 2. Requirement schedules are graduated, and each deposit interval applies to the amount of reservable liabilities subject to this zero percent reserve requirethat part of the deposits of each bank. Demand deposits subject to reserve ment each year for the next succeeding calendar year by 80 percent of the requirements were gross demand deposits minus cash items in process of percentage increase in the total reservable liabilities of all depository institutions, collection and demand balances due from domestic banks. measured on an annual basis as of June 30. No corresponding adjustment is to be The Federal Reserve Act as amended through 1978 specified different ranges of made in the event of a decrease. Effective Dec. 9, 1982, the amount of the requirements for reserve city banks and for other banks. Reserve cities were exemption was established at $2.1 million. Effective with the reserve maintenance designated under a criterion adopted effective Nov. 9, 1972, by which a bank period beginning Jan. 12, 1984, the amount of the exemption is $2.2 million. In having net demand deposits of more than $400 million was considered to have the determining the reserve requirements of a depository institution, the exemption character of business of a reserve city bank. The presence of the head office of shall apply in the following order: (1) nonpersonal money market deposit accounts such a bank constituted designation of that place as a reserve city. Cities in which (MMDAs) authorized under 12 CFR section 1204.122; (2) net NOW accounts there were Federal Reserve Banks or branches were also reserve cities. Any (NOW accounts less allowable deductions); (3) net other transaction accounts; banks having net demand deposits of $400 million or less were considered to have and (4) nonpersonal time deposits or Eurocurrency liabilities starting with those the character of business of banks outside of reserve cities and were permitted to with the highest reserve ratio. With respect to NOW accounts and other maintain reserves at ratios set for banks not in reserve cities. transaction accounts, the exemption applies only to such accounts that would be Effective Aug. 24, 1978, the Regulation M reserve requirements on net balances subject to a 3 percent reserve requirement. due from domestic banks to their foreign branches and on deposits that foreign 6. For nonmember banks and thrift institutions that were not members of the branches lend to U.S. residents were reduced to zero from 4 percent and 1 percent Federal Reserve System on or after July 1, 1979, a phase-in period ends Sept. 3, respectively. The Regulation D reserve requirement of borrowings from unrelated 1987. For banks that were members on or after July 1, 1979, but withdrew on or banks abroad was also reduced to zero from 4 percent. before Mar. 31, 1980, the phase-in period established by Public Law 97-320 ends Effective with the reserve computation period beginning Nov. 16, 1978, on Oct. 24, 1985. For existing member banks the phase-in period of about three domestic deposits of Edge corporations were subject to the same reserve years was completed on Feb. 2, 1984. All new institutions will have a two-year requirements as deposits of member banks. phase-in beginning with the date that they open for business, except for those 3. Negotiable order of withdrawal (NOW) accounts and time deposits such as institutions that have total reservable liabilities of $50 million or more. Christmas and vacation club accounts were subject to the same requirements as 7. Transaction accounts include all deposits on which the account holder is savings deposits. permitted to make withdrawals by negotiable or transferable instruments, pay- The average reserve requirement on savings and other time deposits before ment orders of withdrawal, and telephone and preauthorized transfers (in excess implementation of the Monetary Control Act had to be at least 3 percent, the of three per month) for the purpose of making payments to third persons or others. minimum specified by law. However, MMDAs and similar accounts offered by institutions not subject to the 4. Effective Nov. 2, 1978, a supplementary reserve requirement of 2 percent rules of the Depository Institutions Deregulation Committee (DIDC) that permit was imposed on large time deposits of $100,000 or more, obligations of affiliates, no more than six preauthorized, automatic, or other transfers per month of which and ineligible acceptances. This supplementary requirement was eliminated with no more than three can be checks—are not transaction accounts (such accounts the maintenance period beginning July 24, 1980. are savings deposits subject to time deposit reserve requirements.) Effective with the reserve maintenance period beginning Oct. 25, 1979, a 8. The Monetary Control Act of 1980 requires that the amount of transaction marginal reserve requirement of 8 percent was added to managed liabilities in accounts against which the 3 percent reserve requirement applies be modified excess of a base amount. This marginal requirement was increased to 10 percent annually by 80 percent of the percentage increase in transaction accounts held by beginning Apr. 3, 1980, was decreased to 5 percent beginning June 12, 1980, and all depository institutions determined as of June 30 each year. Effective Dec. 31, was eliminated beginning July 24, 1980. Managed liabilities are defined as large 1981, the amount was increased accordingly from $25 million to $26 million; and time deposits, Eurodollar borrowings, repurchase agreements against U.S. effective Dec. 30, 1982, to $26.3 million; and effective Dec. 29, 1983, to $28.9 government and federal agency securities, federal funds borrowings from non- million. member institutions, and certain other obligations. In general, the base for the 9. In general, nonpersonal time deposits are time deposits, including savings marginal reserve requirement was originally the greater of (a) $100 million or (b) deposits, that are not transaction accounts and in which a beneficial interest is the average amount of the managed liabilities held by a member bank, Edge held by a depositor that is not a natural person. Also included are certain corporation, or family of U.S. branches and agencies of a foreign bank for the two transferable time deposits held by natural persons, and certain obligations issued reserve computation periods ending Sept. 26, 1979. For the computation period to depository institution offices located outside the United States. For details, see beginning Mar. 20, 1980, the base was lowered by (a) 7 percent or (b) the decrease section 204.2 of Regulation D. in an institution's U.S. office gross loans to foreigners and gross balances due from foreign offices of other institutions between the base period (Sept. 13-26, NOTE. Required reserves must be held in the form of deposits with Federal 1979) and the week ending Mar. 12, 1980, whichever was greater. For the Reserve Banks or vault cash. Nonmembers may maintain reserve balances with a computation period beginning May 29, 1980, the base was increased by 7'/2 Federal Reserve Bank indirectly on a pass-through basis with certain approved percent above the base used to calculate the marginal reserve in the statement institutions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 Domestic Nonfinancial Statistics • January 1985 1.16 MAXIMUM INTEREST RATES PAYABLE on Time and Savings Deposits at Federally Insured Institutions1 Percent per annum Commercial banks mut S ua a l v i s n a g v s i n a g n s d b l a o n a k n s a ( s t s h o r c if i t a t i i n o s n ti s t u a t n io d n s)1 In effect Dec. 31, 1984 In effect Dec. 31, 1984 Type of deposit Effective date Percent Effective date 1 Savings 5 51 1 / / 4 : 1/1/84 5Vi 7/1/79 2 Negotiable order of withdrawal accounts 12/31/80 5'/4 12/31/80 3 Negotiable order of withdrawal accounts of $2,500 or more2 1/5/83 1/5/83 4 Money market deposit account2 12/14/82 12/14/82 Time accounts by maturity 5 7-31 days of less than $2,5004 . 1/1/84 5'/2 9/1/82 6 7-31 days of $2,500 or more2.. 1/5/83 1/5/83 7 More than 31 days 10/1/83 10/1/83 1. Effective Oct. 1, 1983, restrictions on the maximum rates of interest payable period is required for this account, but depository institutions must reserve the by commercial banks and thrift institutions on various categories of deposits were right to require seven days notice before withdrawals. When the average balance removed. For information regarding previous interest rate ceilings on all catego- is less than $2,500, the account is subject to the maximum ceiling rate of interest ries of accounts see earlier issues of the FEDERAL RESERVE BULLETIN, the for NOW accounts; compliance with the average balance requirement may be Federal Home Loan Bank Board Journal, and the Annual Report of the Federal determined over a period of one month. Depository institutions may not guarantee Deposit Insurance Corporation before November 1983. a rate of interest for this account for a period longer than one month or condition 2. Effective Dec. 1, 1983, IRA/Keogh (HR10) Plan accounts are not subject to the payment of a rate on a requirement that the funds remain on deposit for longer minimum deposit requirements. than one month. 3. Effective Dec. 14, 1982, depository institutions are authorized to offer a new 4. Deposits of less than $2,500 issued to governmental units continue to be account with a required initial balance of $2,500 and an average maintenance subject to an interest rate ceiling of 8 percent. balance of $2,500 not subject to interest rate restrictions. No minimum maturity Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS Millions of dollars 1984 TTyyppee ooff ttrraannssaaccttiioonn 11998811 11998822 11998833 Mar. Apr. May June July Aug. Sept. U.S. GOVERNMENT SECURITIES Outright transactions (excluding matched transactions) Treasury bills 1 Gross purchases 13,899 17,067 18,888 3,159 3,283 610 801 0 187 3,249 2 Gross sales 6,746 8,369 3,420 0 0 2,003 0 897 1,491 71 3 Exchange 0 0 0 0 0 0 0 0 0 0 4 Redemptions 1,816 3,000 2,400 0 3,283 2,200 801 600 800 0 Others within 1 year 5 Gross purchases 317 312 484 0 198 0 0 0 0 600 6 Gross sales 23 0 0 0 0 0 0 0 0 0 7 Maturity shift 13,794 17,295 18,887 1,012 347 2,739 1,069 427 3,811 872 8 Exchange -12,869 -14,164 -16,553 0 -2,223 -1,807 0 -2,606 -2,274 0 9 Redemptions 0 0 87 0 0 0 0 0 0 0 I to 5 years 10 Gross purchases 1,702 1,797 1,896 0 808 0 0 0 0 0 11 Gross sales 0 0 0 0 0 0 0 0 0 0 12 Maturity shift -10,299 -14,524 -15,533 -1,012 -273 -2,279 -1,069 -345 -3,811 -872 13 Exchange 10,117 11,804 11,641 0 2,223 1,150 0 2,606 1,443 0 5 to 10 years 14 Gross purchases 393 388 890 0 200 0 0 0 0 0 15 Gross sales 0 0 0 0 0 0 0 0 0 0 16 Maturity shift -3,495 -2,172 -2,450 0 -75 -383 0 -83 52 0 17 Exchange 1,500 2,128 2,950 0 0 400 0 0 500 0 Over 10 years 18 Gross purchases 379 307 383 0 277 0 0 0 0 0 19 Gross sales 0 0 0 0 0 0 0 0 0 0 20 Maturity shift 0 -601 -904 0 0 -77 0 0 -52 0 21 Exchange 1,253 234 1,962 0 0 257 0 0 332 0 All maturities 22 Gross purchases 16,690 19,870 22,540 3,159 1,484 610 801 0 0 3,849 23 Gross sales 6,769 8,369 3,420 0 0 2,003 0 897 187 71 24 Redemptions 1,816 3,000 2,487 0 0 2,200 0 600 800 0 Matched transactions 25 Gross sales 589,312 543,804 578,591 66,827 72,293 79,313 61,017 81,799 79,087 52,893 26 Gross purchases 589,647 543,173 576,908 73,634 71,754 79,608 61,331 81,143 78,842 55,776 Repurchase agreements 27 Gross purchases 79,920 130,774 105,971 4,996 15,313 8,267 23,298 14,830 4,992 26,040 28 Gross sales 78,733 130,286 108,291 4,996 8,220 12,199 26,460 14,830 166 30,867 29 Net change in U.S. government securities 9,626 8,358 12,631 9,966 11,321 -7,228 -2,047 -2,154 2,478 1,835 FEDERAL AGENCY OBLIGATIONS Outright transactions 30 Gross purchases 494 0 0 0 0 0 0 0 0 0 31 Gross sales 0 0 0 0 0 0 0 0 0 0 32 Redemptions 108 189 292 10 2 40 15 -1 5 3,743 Repurchase agreements 33 Gross purchases 13,320 18,957 8,833 609 1,247 616 1,819 958 381 3,743 34 Gross sales 13,576 18,638 9,213 609 820 744 2,117 958 12 4,112 35 Net change in federal agency obligations 130 130 -672 -10 424 -169 -313 -1 364 -370 BANKERS ACCEPTANCES 36 Repurchase agreements, net -582 1,285 -1,062 0 305 122 -426 0 0 0 37 Total net change in System Open Market Account 9,175 9,773 10,897 9,956 12,050 -7,275 -2,786 -2,155 2,842 1,465 NOTE: Sales, redemptions, and negative figures reduce holdings of the System Open Market Account; all other figures increase such holdings. Details may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 Domestic Nonfinancial Statistics • January 1985 1.18 FEDERAL RESERVE BANKS Condition and Federal Reserve Note Statements Millions of dollars Wednesday End of month 1984 1984 Oct. 3 Oct. 10 Oct. 17 Oct. 24 Oct. 31 Aug. Sept. Oct. Consolidated condition statement ASSETS 1 Gold certificate account 11,097 11,097 11,097 11,096 11,096 11,098 11,097 11,096 2 Special drawing rights certificate account 4,618 4,618 4,618 4,618 4,618 4,618 4,618 4,618 3 Coin 487 482 485 490 485 454 478' 485 Loans 4 To depository institutions 5,711 5,809 6,425 5,164 5,060 8,276 6,633 5,060 5 Other 0 0 0 0 0 0 0 0 Acceptances—Bought outright 6 Held under repurchase agreements .... 0 0 0 0 0 0 0 0 Federal agency obligations 7 Bought outright 8,493 8,484 8,479 8,479 8,479 8,494 8,493 8,479 8 Held under repurchase agreements .... 0 0 0 0 0 369 0 0 U.S. government securities Bought outright 9 Bills 66,204 61,201 64,188 61,646 61,689 62,425 68,487 61,689 10 Notes 64,194 64,194 64,194 64,194 64,494 63,894 64,494 64,494 11 Bonds 22,037 22,037 22,037 22,037 22,037 22,037 22,037 22,037 12 Total bought outright1 152,435 147,432 150,419 147,877 148,220 148,356 155,018 148,220 13 Held under repurchase agreements .... 0 0 0 0 0 4,827 0 0 14 Total U.S. government securities 152,435 147,432 150,419 147,877 148,220 153,183 155,018 148,220 15 Total loans and securities 166,639 161,725 165,323 161,520 161,759 170,322 170,144 161,759 16 Cash items in process of collection 8,078 13,416 9,430 5,199 7,020 6,808 7,052 7,020 17 Bank premises 564 564 565 566 565 554 564 565 Other assets 18 Denominated in foreign currencies2.... 3,567 3,569 3,571 3,621 3,647 3,672 3,522 3,647 19 All other3 8,008 8,292 8,065 8,390 8,263 4,064 8,122 8,263 20 Total assets. 203,058 203,763 203,154 195,500 197,453 201,590 205,597' 197,453 LIABILITIES 21 Federal Reserve notes 161.002 162,469 161,750 160,801 160,972 161,551 160,046' 160,972 Deposits 22 To depository institutions 22,683 22,321 22,679 19,421 19,740 22,733 23,612 19,740 23 U.S. Treasury—General account 5,396 3,144 4,188 2,971 3,791 4,029 8,514 3,791 24 Foreign—Official accounts 250 246 259 194 270 242 206 270 25 Other 431 429 318 275 321 413 383 321 26 Total deposits 28,760 26,140 27,444 22,861 24,122 27,417 32,715 24,122 27 Deferred availability cash items 7,500 9,008 7,850 5,801 6,362 6,482 6,763 6,362 28 Other liabilities and accrued dividends4 . 2,512 2,616 2,573 2,492 2,433 2,591 2,593 2,433 29 Total liabilities . 199,774 200,233 199,617 191,955 193,889 198,041 202,117' 193,889 CAPITAL ACCOUNTS 30 Capital paid in 1,601 1,604 1,607 1,608 1,611 1,557 1,597 1,611 31 Surplus 1,465 1,465 1,465 1,465 1,465 1,465 1,465 1,465 32 Other capital accounts 218 461 465 472 488 527 418 488 33 Total liabilities and capital accounts 203,058 203,763 203,154 195,500 197,453 201,590 205,597' 197,453 34 MEMO: Marketable U.S. government securities held in custody for foreign and international account 116,671 116,909 115,107 119,058 119,233 119,421 115,174 119,233 Federal Reserve note statement 35 Federal Reserve notes outstanding 190,478 190,806 191,334 191,730 191,730 189,217 189,882 191,730 36 LESS: Held by bank 29,476 28,337 29,584 30,929 30,758 27,666 29,836' 30,758 37 Federal Reserve notes, net 161,002 162,469 161,750 160,801 160,972 161,551 160,046' 160,972 Collateral held against notes net: 38 Gold certificate account 11,097 11,097 11,097 11,096 11,096 11,098 11,097 11,096 39 Special drawing rights certificate account 4,618 4,618 4,618 4,618 4,618 4,618 4,618 4,618 40 Other eligible assets 0 0 0 0 0 0 0 0 41 U.S. government and agency securities 145,287 146,754 146,035 145,087 145,258 145,835 144,331' 145,258 42 Total collateral 161,002 162,469 161,750 160,801 160,972 161,551 160,046' 160,972 1. Includes securities loaned—fully guaranteed by U.S. government securities 4. 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. 2. Assets shown in this line are revalued monthly at market exchange rates. NOTE: Some of these data also appear in the Board's H.4.1 (503) release. For 3. Includes special investment account at Chicago of Treasury bills maturing address, see inside front cover. within 90 days. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Banks All 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holdings Millions of dollars Wednesday End of month TTTyyypppeee aaannnddd mmmaaatttuuurrriiitttyyy gggrrrooouuupppiiinnngggsss 1984 1984 Oct. 3 Oct. 10 Oct. 17 Oct. 24 Oct. 31 Aug. 31 Sept. 28 Oct. 31 5,711 5,809 6,425 5,164 5,060 8,276 6,633 5,060 3 2 W 16 i t d h a in y s 1 t 5 o d 9 a 0 y s d ays 5,5 1 4 7 0 0 1 5,6 1 3 7 5 0 4 6,37 5 5 0 0 5,10 6 1 0 3 4,97 8 3 0 7 8,1 1 1 6 1 0 5 6,54 8 6 0 7 4,97 8 3 0 7 0 0 0 0 0 0 0 0 6 Within 15 days 0 0 0 0 0 0 0 0 7 16 days to 90 days 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 9 0 1 U. W S 16 . i t g d h o a in y v s e 1 r t n 5 o m d 9 e a 0 n y t d s ' a s y e s c urities—Total 1 4 3 5 3 6 3 2 , , , , 7 9 7 4 9 6 4 3 2 7 4 5 1 4 3 4 5 3 0 7 , , , , 3 2 8 4 4 3 6 8 4 2 8 8 1 4 3 5 4 4 3 0 , , , , 1 8 4 4 4 9 4 1 5 7 5 9 1 4 3 4 4 4 0 7 , , , , 7 8 2 8 7 8 7 8 8 2 7 5 1 2 4 4 9 4 5 8 , , , , 8 8 6 2 7 1 7 2 1 1 2 0 1 4 3 5 8 4 3 3 , , , , 5 0 1 1 4 4 0 8 4 0 5 3 1 4 3 5 4 7 5 5 , , , , 1 3 4 0 2 5 0 1 5 2 5 8 1 4 2 4 4 5 9 8 , , , , 8 6 8 2 1 7 7 2 1 2 1 0 1 1 3 4 O Ov v e e r r 5 1 y y e e a a r r s t o to 5 1 y 0 e y ar e s a rs 3 1 3 4 , , 7 8 5 0 6 8 3 1 3 4 , , 7 8 5 0 6 8 3 1 3 4 , , 7 8 5 0 6 8 3 1 3 4 , , 7 8 5 0 6 8 3 1 3 4 , , 6 8 9 0 0 8 3 1 3 4 , , 3 8 1 0 8 8 3 1 3 4 , , 9 8 6 0 0 8 3 1 3 4 , , 6 8 9 0 0 8 19,368 19,368 19,368 19,368 19,368 19,368 19,368 19,368 1 1 1 6 7 8 Fe W d 16 e i r t d a h l a i n y a s g 1 e t 5 o n c d 9 y a 0 y o d s b ' a l y ig s ations—Total 8 1 , , 4 8 5 1 9 5 5 0 3 6 8 4 8 1 , , 4 7 6 8 3 5 5 4 4 0 0 8 1 , , 4 6 6 1 7 8 1 2 9 4 6 9 8 1 , , 4 6 7 1 7 4 5 0 9 1 0 4 8 1 , , 4 5 7 1 7 5 6 7 9 6 0 4 8 1 , , 8 7 5 5 6 5 7 2 3 4 1 3 8 1 , , 4 7 2 5 9 2 3 6 3 1 4 3 8 1 , , 4 5 7 7 5 6 1 9 6 0 7 2 2 2 0 1 2 O O O v v v e e e r r r 5 1 1 0 y y e e y a a e r r a s r t s o t o 5 1 y 0 e y ar e s a rs 4 1 , , 3 3 2 1 6 9 0 6 9 4 1 , , 3 2 3 9 5 9 9 2 9 4 1 , , 3 2 3 9 5 9 9 2 9 4 1 , , 3 2 3 5 3 9 3 2 9 4 1 , , 3 2 3 5 3 9 8 2 9 4 1 , , 3 3 3 0 1 9 4 2 9 4 1 , , 3 2 3 1 6 9 0 6 9 4 1 , , 3 2 3 5 3 9 8 2 9 1. Holdings under repurchase agreements are classified as maturing within 15 days in accordance with maximum maturity of the agreements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A12 Domestic Nonfinancial Statistics • January 1985 1.20 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND MONETARY BASE A Billions of dollars, averages of daily figures 1984 11998800 11998811 11998822 11998833 IItteemm DDeecc.. DDeecc.. DDeecc.. DDeecc.. Mar. Apr. May June July Aug. Sept. Oct. Seasonally adjusted AADDJJUUSSTTEEDD FFOORR CCHHAANNGGEESS IINN RREESSEERRVVEE RREEQQUUIIRREEMMEENNTTSS'' 11 TToottaall rreesseerrvveess22 31.07 32.14 34.34 36.21 37.10 37.11 37.45 38.28 38.23 38.38 38.14 37.75 22 NNoonnbboorrrroowweedd rreesseerrvveess 29.38 31.51 33.70 35.44 36.15 35.87 34.46 34.98 32.31 30.36 30.89 31.73 33 NNoonnbboorrrroowweedd rreesseerrvveess pplluuss eexxtteennddeedd ccrreeddiitt33 29.38 31.65 33.89 35.44 36.17 35.92 34.50 36.85 37.32 37.41 37.35 36.79 44 RReeqquuiirreedd rreesseerrvveess 30.55 31.82 33.84 35.65 36.39 36.62 36.87 37.52 37.63 37.70 37.52 37.14 55 MMoonneettaarryy bbaassee44 150.38 158.15 170.21 185.57 189.42 190.36 191.98 193.86 194.75 195.98 195.99 196.38 Not seasonally adjusted 6 Total reserves2 31.77 32.86 35.06 36.86 36.61 37.45 36.77 37.79 37.85 37.69 37.87 37.94 7 Nonborrowed reserves 30.08 32.23 34.43 36.16 35.66 36.24 33.78 34.49 31.92 29.67 30.63 31.92 8 Nonborrowed reserves plus extended credit3 30.08 32.37 34.62 36.16 35.69 36.29 33.82 36.37 36.93 36.72 37.09 36.98 9 Required reserves 31.25 32.54 34.56 36.37 35.90 36.99 36.19 37.03 37.24 37.01 37.25 37.33 10 Monetary base4 153.08 161.00 173.24 188.84 188.15 190.67 191.33 194.24 195.91 196.13 196.07 196.12 NOT ADJUSTED FOR CHANGES IN RESERVE REQUIREMENTS5 11 Total reserves2 40.66 41.92 41.85 38.89 36.28 37.15 36.52 37.52 37.46 37.27 38.04 38.50 12 Nonborrowed reserves 38.97 41.29 41.22 38.12 35.30 35.73 33.79 34.46 31.27 29.22 30.87 32.20 13 Nonborrowed reserves plus extended credit3 38.97 41.44 41.41 38.12 35.33 35.77 33.83 36.22 36.38 36.28 37.28 37.36 14 Required reserves 40.15 41.61 41.35 38.33 35.53 36.67 35.81 36.85 36.93 36.54 37.42 37.78 15 Monetary base4 163.00 170.47 180.52 192.36 187.66 190.10 191.39 194.15 195.44 195.66 196.25 196.34 • Figures have been revised from 1959 to date. of vault cash holdings of thrift institutions that is included in the currency 1. Figures incorporate adjustments for discontinuities associated with the component of the money stock plus, for institutions not having required reserve implementation of the Monetary Control Act and other regulatory changes to balances, the excess of current vault cash over the amount applied to satisfy reserve requirements. To adjust for discontinuities due to changes in reserve current reserve requirements. After the introduction of contemporaneous reserve requirements on reservable nondeposit liabilities, the sum of such required requirements (CRR), currency and vault cash figures are measured over the reserves is subtracted from the actual series. Similarly, in adjusting for discontin- weekly computation period ending Monday. uities in the monetary base, required clearing balances and adjustments to Before CRR, all components of the monetary base other than excess reserves compensate for float also are subtracted from the actual series. are seasonally adjusted as a whole, rather than by component, and excess 2. Total reserves not adjusted for discontinuities consist of reserve balances reserves are added on a not seasonally adjusted basis. After CRR, the seasonally with Federal Reserve Banks, which exclude required clearing balances and adjusted series consists of seasonally adjusted total reserves, which include adjustments to compensate for float, plus vault cash used to satisfy reserve excess reserves on a not seasonally adjusted basis, plus the seasonally adjusted requirements. Such vault cash consists of all vault cash held during the lagged currency component of the money stock and the remaining items seasonally computation period by institutions having required reserve balances at Federal adjusted as a whole. Reserve Banks plus the amount of vault cash equal to required reserves during the 5. Reflects actual reserve requirements, including those on nondeposit liabilmaintenance period at institutions having no required reserve balances. ities, with no adjustments to eliminate the effects of discontinuities associated 3. Extended credit consists of borrowing at the discount window under the with implementation of the Monetary Control Act or other regulatory changes to terms and conditions established for the extended credit program to help reserve requirements. depository institutions deal with sustained liquidity pressures. Because there is NOTE. Latest monthly and biweekly figures are available from the Board's not the same need to repay such borrowing promptly as there is with traditional H.3(502) statistical release. Historical data and estimates of the impact on short-term adjustment credit, the money market impact of extended credit is required reserves of changes in reserve requirements are available from the similar to that of nonborrowed reserves. Banking Section, Division of Research and Statistics, Board of Governors of the 4. The monetary base not adjusted for discontinuities consists of total reserves Federal Reserve System, Washington, D.C. 20551. plus required clearing balances and adjustments to compensate for float at Federal Reserve Banks and the currency component of the money stock less the amount Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary and Credit Aggregates A13 1.21 MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES Billions of dollars, averages of daily figures 1984 1980 1981 1982 1983 DDeecc.. DDeecc.. DDeecc.. DDeecc.. JJuullyy'' AAuugg// SSeepptt// OOcctt.. Seasonally adjusted 1 Ml 414.9 441.9 480.5 525.3 545.8 546.7 548.9 545.5 2 M2 1,632.6 1,796.6 1,965.3 2,1%.2 2,281.9 2,291.1 2,305.8 2,317.2 3 M3 1,989.8 2,236.7 2,460.3 2,707.9 2,860.5 2,872.2 2,890.6 2,917.3 4 L 2,326.0 2,598.4 2,868.7 3,176.3 3,407.0 n.a. n.a. n.a. 5 Debt2 3,946.9 4,323.8 4,710.1 5,224.8 5,632.2 5,694.0 5,742.8 n.a. Ml components 6 Currency2 116.7 124.0 134.1 148.0 155.0 156.0 156.7 157.2 7 Travelers checks3 4.2 4.3 4.3 4.9 5.2 5.2 5.1 5.0 8 Demand deposits4 266.5 236.2 239.7 243.7 247.1 245.5 246.4 243.8 9 Other checkable deposits5 27.6 77.4 102.4 128.8 138.3 139.6 140.8 139.6 Nontransactions components 10 In M26 1,217.7 1,354.6 1,484.8 1,670.9 1,736.1 1,744.4 1,756.9 1,771.8 11 In M3 only7 357.2 440.2 495.0 511.8 578.6 581.1 584.8 600.1 Savings deposits9 12 Commercial Banks 185.9 159.7 164.9 134.6 127.4 126.3 125.9 125.2 13 Thrift institutions 215.6 186.1 197.2 178.2 175.6 173.4 173.0 172.2 Small denomination time deposits9 14 Commerical Banks 287.5 349.6 382.2 353.1 371.8 377.9 382.3 384.4 15 Thrift institutions 443.9 477.7 474.7 440.0 473.3 484.2 492.3 500.6 Money market mutual funds 16 General purpose and broker/dealer 61.6 150.6 185.2 138.2 150.5 150.5 151.9 155.5 17 Institution-only 15.0 36.2 48.4 40.3 46.1 46.2 46.9 52.2 Large denomination time deposits10 18 Commercial Banks" 213.9 247.3 261.8 225.5 254.8 255.3 257.8 262.3 19 Thrift institutions 44.6 54.3 66.1 100.4 134.2 136.7 135.1 138.7 Debt components 20 Federal debt 742.8 830.1 991.4 1,173.1 1,276.8 1,300.1 1,310.9 n.a. 21 Non-federal debt 3,204.1 3,493.7 3,718.7 4,052.1 4,355.4 4,393.9 4,431.8 n.a. Not seasonally adjusted 22 Ml 424.8 452.3 491.9 537.8 547.5 542.7 546.3 546.0 23 M2 1,635.4 1,798.7 1,967.4 2,198.0 2,287.0 2,288.5 2.299.4 2,316.5 24 M3 1,996.1 2,242.7 2,466.6 2,713.9 2,859.4 2,870.3 2,884.9 2,915.4 25 L 2,332.8 2,605.6 2,876.5 3,187.0 3,399.1 n.a. n.a. n.a. 26 Debt2 3,946.9 4,323.8 4,710.1 5,218.7 5,613.0 5,675.8 5,731.5 n.a. Ml components 27 Currency2 118.8 126.1 136.4 150.5 156.3 156.5 156.5 156.7 28 Travelers checks3 3.9 4.1 4.1 4.6 5.8 5.7 5.4 5.0 29 Demand deposits4 274.7 243.6 247.3 251.6 247.5 242.9 245.3 244.9 30 Other checkable deposits5 27.4 78.5 104.1 131.2 137.7 137.3 139.1 139.4 Nontransactions components 31 M26 1,210.6 1,346.3 1,475.5 1,660.2 1,739.5 1,745.8 1,753.1 1,770.6 32 M3 only7 360.7 444.1 499.2 516.1 572.4 581.8 585.6 598.9 Money market deposit accounts 33 Commercial banks n.a. n.a. 26.3 230.0 243.9 242.6 243.8 247.2 34 Thrift institutions n.a. n.a. 16.6 145.9 145.3 141.2 139.6 139.6 Savings deposits8 35 Commercial Banks 183.8 157.5 162.1 132.0 128.9 126.4 124.7 123.8 36 Thrift institutions 214.4 184.7 195.5 176.5 177.7 173.4 171.9 171.9 Small denomination time deposits9 37 Commercial Banks 286.0 347.7 380.1 351.0 370.8 377.6 381.6 383.8 38 Thrift institutions 442.3 475.6 472.4 437.6 473.1 482.6 490.2 499.7 Money market mutual funds 39 General purpose and broker/dealer 61.6 150.6 185.2 138.2 150.5 150.5 151.9 155.5 40 Institution-only 15.0 36.2 48.4 40.3 -46.1 46.2 46.9 52.5 Large denomination time deposits10 41 Commercial Banks" 218.5 252.1 266.2 229.0 251.5 255.6 258.7 263.2 42 Thrift institutions 44.3 54.3 66.2 100.7 -132.9 136.9 136.9 141.7 Debt components 43 Federal debt 742.8 830.1 991.4 1,170.2 1,270.8 1,295.8 1,310.5 n.a. 44 Non-federal debt 3,204.1 3,943.7 3,718.7 4,048.5 4,342.2 4,380.0 4,421.0 n.a. For notes see bottom of next page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Nonfinancial Statistics • January 1985 NOTES TO TABLE 1.21 1. Composition of the money stock measures and debt is as follows: 2. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults commercial banks. Excludes the estimated amount of vault cash held by thrift of commercial banks; (2) travelers checks of nonbank issuers; (3) demand deposits institutions to service their OCD liabilities. at all commercial banks other than those due to domestic banks, the U.S. 3. Outstanding amount of U.S. dollar-denominated travelers checks of nongovernment, and foreign banks and official institutions less cash items in the bank issuers. Travelers checks issued by depository institutions are included in process of collection and Federal Reserve float: and (4) other checkable deposits demand deposits. (OCD) consisting of negotiable order of withdrawal (NOW) and automatic transfer 4. Demand deposits at commercial banks and foreign-related institutions other service (ATS) accounts at depository institutions, credit union share draft than those due to domestic banks, the U.S. government, and foreign banks and accounts, and demand deposits at thrift institutions. The currency and demand official institutions less cash items in the process of collection and Federal deposit components exclude the estimated amount of vault cash and demand Reserve float. Excludes the estimated amount of demand deposits held at deposits respectively held by thrift institutions to service their OCD liabilities. commercial banks by thrift institutions to service their OCD liabilities. M2: Ml plus overnight (and continuing contract) repurchase agreements (RPsI 5. Consists of NOW and ATS balances at all depository institutions, credit issued by all commercial banks and overnight Eurodollars issued to U.S. residents union share draft balances, and demand deposits at thrift institutions. Other by foreign branches of U.S. banks worldwide, MMDAs, savings and small- checkable deposits seasonally adjusted equals the difference between the seasondenomination time deposits (time deposits—including retail RPs—in amounts of ally adjusted sum of demand deposits plus OCD and seasonally adjusted demand less than $100,000), and balances in both taxable and tax-exempt general purpose deposits. Included are all ceiling free "Super NOWs," authorized by the and broker/dealer money market mutual funds. Excludes individual retirement Depository Institutions Deregulation committee to be offered beginning Jan. 5, accounts (IRA) and Keogh balances at depository institutions and money market 1983. funds. Also excludes all balances held by U.S. commercial banks, money market 6. Sum of overnight RPs and overnight Eurodollars, money market fund funds (general purpose and broker/dealer), foreign governments and commercial balances (general purpose and broker/dealer), MMDAs, and savings and small banks, and the U.S. government. Also subtracted is a consolidation adjustment time deposits, less the consolidation adjustment that represents the estimated that represents the estimated amount of demand deposits and vault cash held by amount of demand deposits and vault cash held by thrift institutions to service thrift institutions to service their time and savings deposits. their time and savings deposits liabilities. M3: M2 plus large-denomination time deposits and term RP liabilities (in 7. Sum of large time deposits, term RPs and term Eurodollars of U.S. amounts of $100,000 or more) issued by commercial banks and thrift institutions, residents, money market fund balances (institution-only), less a consolidation term Eurodollars held by U.S. residents at foreign branches of U.S. banks adjustment that represents the estimated amount of overnight RPs and Eurodolworldwide and at all banking offices in the United Kingdom and Canada, and lars held by institution-only money market funds. balances in both taxable and tax-exempt, institution-only money market mutual 8. Savings deposits exclude MMDAs. funds. Excludes amounts held by depository institutions, the U.S. government, 9. Small-denomination time deposits—including retail RPs— are those issued money market funds, and foreign banks and official institutions. Also subtracted is in amounts of less than $100,000. All individual retirement accounts (IRA) and a consolidation adjustment that represents the estimated amount of overnight RPs Keogh accounts at commercial banks and thrifts are subtracted from small time and Eurodollars held by institution-only money market mutual funds. deposits. L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term 10. Large-denomination time deposits are those issued in amounts of $100,000 Treasury securities, commercial paper and bankers acceptances, net of money or more, excluding those booked at international banking facilities. market mutual fund holdings of these assets. 11. Large-denomination time deposits at commercial banks less those held by Debt: Debt of domestic nonfinancial sectors consists of outstanding credit money market mutual funds, depository institutions, and foreign banks and market debt of the U.S. government, state and local governments, and private official institutions. nonfinancial sectors. Private debt consists of corporate bonds, mortgages, con- NOTE: Latest monthly and weekly figures are available from the Board's H.6 sumer credit (including bank loans), other bank loans, commercial paper, bankers (508) release. Historical data are available from the Banking Section, Division of acceptances, and other debt instruments. The source of data on domestic Research and Statistics, Board of Governors of the Federal Reserve System, nonfinancial debt is the Federal Reserve Board's flow of funds accounts. Debt Washington. D.C. 20551. data are on an end-of-month basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary and Credit Aggregates A15 1.22 BANK DEBITS AND DEPOSIT TURNOVER Debits are shown in billions of dollars, turnover as ratio of debits to deposits. Monthly data are at annual rates. Bank group, or type of customer 19811 1982' Apr. May July Aug. Sept. Seasonally adjusted DEBITS TO Demand deposits2 1 All insured banks 80,858.7 90,914.4 109,642.3 129,229.4 131,456.9 121,488.2 128,299.3 128,141.9 124,117.4 2 Major New York City banks 34,108.1 37,932.9 47,769.4 57,868.3 60,351.3 53,147.7 55,340.6 57,096.5 55,591.4 3 Other banks 46,966.5 52,981.5 61,873.1 71,361.1 71,105.6 68,340.4 72,958.7 71,045.4 68,526.0 4 ATS-NOW accounts3 761.0 1,036.2 1,405.5 1,432.1 1,608.9 1,515.8 1,658.9 1,851.9 1,640.6 5 Savings deposits4 679.6 720.3 741.4 606.5 688.8 677.9 682.4 694.5 566.8 DEPOSIT TURNOVER Demand deposits2 6 All insured banks 285.8 324.2 379.7 441.7 442.7 401.8 433.0 436.7 424.5 7 Major New York City banks 1,116.7 1,287.6 1,528.0 2,012.5 1,938.7 1,665.2 1,774.3 1,834.6 1,822.5 8 Other banks 185.9 211.1 240.9 270.5 267.5 252.7 275.2 270.9 261.7 9 ATS-NOW accounts3 14.4 14.5 15.6 14.6 16.0 15.1 16.6 18.3 16.2 10 Savings deposits4 4.1 4.5 5.4 4.8 5.5 5.4 5.5 5.6 4.6 Not seasonally adjusted DEBITS TO Demand deposits2 11 All insured banks 81,197.9 91.031.8 109,517.6 121,514.4 132,521.7 128,522.3 124,604.3 133,844.2 120,120.8 12 Major New York City banks 34,032.0 38,001.0 47,707.4 53,514.4 60,214.5 57,168.1 54,060.5 59,743.8 54,329.0 13 Other banks 47,165.9 53.030.9 64,310.2 68,000.0 72,307.2 71,354.3 70,543.8 74,100.3 65,791.8 14 ATS-NOW accounts3 737.6 1,027.1 1,397.0 1,670.1 1,599.0 1,621.7 1,598.5 1,629.4 1,523.7 15 MMDA5 567.4 918.9 883.6 894.8 891.7 888.2 821.6 16 Savings deposits4 672.9 720.0 742.0 665.7 673.8 686.2 686.3 680.3 543.1 DEPOSIT TURNOVER Demand deposits2 17 All insured banks 286.4 325.0 379.9 410.8 456.8 428.6 418.1 465.7 408.9 18 Major New York City banks 1,114.2 1,295.7 1,510.0 1,770.2 1,997.1 1,792.0 1,738.1 2,008.0 1,786.4 19 Other banks 186.2 211.5 240.5 256.0 278.1 266.3 264.3 287.6 249.8 20 ATS-NOW accounts3 14.0 14.4 15.5 16.4 16.1 16.2 16.0 16.4 15.2 21 MMDA5 2.8 3.8 3.6 3.7 3.7 3.7 3.4 22 Savings deposits4 4.1 4.5 5.4 5.2 5.3 5.5 5.4 5.5 4.5 1. Annual averages of monthly figures. NOTE. Historical data for demand deposits are available back to 1970 estimated 2. Represents accounts of individuals, partnerships, and corporations and of in part from the debits series for 233 SMSAs that were available through June states and political subdivisions. 1977. Historical data for ATS-NOW and savings deposits are available back to 3. Accounts authorized for negotiable orders of withdrawal (NOW) and ac- July 1977. Back data are available on request from the Banking Section, Division counts authorized for automatic transfer to demand deposits (ATS). ATS data of Research and Statistics, Board of Governors of the Federal Reserve System, availability starts with December 1978. Washington, D.C. 20551. 4. Excludes ATS and NOW accounts, MMDA and special club accounts, such These data also appear on the Board's G.6 (406) release. For address, see inside as Christmas and vacation clubs. front cover. 5. Money market deposit accounts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Nonfinancial Statistics • January 1985 1.23 LOANS AND SECURITIES All Commercial Banks' Billions of dollars; averages of Wednesday figures 1982 1983 1984 1982 1983 1984 Category Dec. Dec. July Aug. Sept. Oct. Dec. Dec. July Aug. Sept. Oct. Seasonally adjusted Not seasonally adjusted 1 Total loans and securities3-4 1,412.0 1,568.1 1,664.7 1,675.5 1,685.6 1,693.9 1,422.4 1,579.5 1,657.9 1,668.8 1,687.2 1,699.7 2 U.S. Treasury securities 130.9 188.0 182.8 184.8 183.7 182.8 131.5 188.8 181.4 182.7 183.0 181.3 3 Other securities4 239.2 247.5 247.7 249.6 250.9 250.8 240.6 249.0 246.4 248.8 251.0 251.1 4 Total loans and leases3-4 1,042.0 1,132.6 1,234.2 1,241.1 1,251.0 1,260.3 1,050.3 1,141.7 1,230.0 11,,223377..33 11,,225533..11 11,,226677..33 5 Commercial and industrial loans4 392.3 413.7 456.6 459.7 461.2 464.7 394.5 416.1 455.2 457.0 460.7 465.5 6 Real estate loans4 303.1 335.5 362.7 366.2 369.6 372.9 304.0 336.5 361.6 365.8 370.3 374.3 7 Loans to individuals 191.9 219.7 248.3 251.2 253.0 254.9 193.2 221.2 247.1 251.5 254.8 256.9 8 Security loans 24.7 27.3 24.6 22.3 25.6 27.5 25.5 28.2 24.0 23.0 25.3 27.3 9 Loans to nonbank financial institutions 31.1 29.7 32.1 31.0 31.0 30.7 32.1 30.6 31.5 30.9 31.1 31.0 10 Agricultural loans 36.3 39.6 41.1 41.4 41.6 41.8 36.3 39.6 41.6 41.9 42.2 42.4 11 Lease financing receivables .. . 13.1 13.1 13.8 14.1 14.3 14.3 13.1 13.1 13.8 14.1 14.3 14.3 12 All other loans 49.5 54.0 54.8 55.2 54.7 53.4 51.5 56.3 55.2 53.2 54.4 55.7 MEMO 13 Total loans and securities plus loans sold3-4-5 1,415.0 1,570.5 1,667.6 1,678.4 1,688.6 1,696.9 1,425.4 1,581.9 1,660.7 1,671.8 1,690.2 1,702.7 14 Total loans plus loans sold3-4-5 .. 1,044.9 1,135.0 1,237.0 1,244.1 1,254.0 1,263.3 1,053.3 1,144.1 1,232.9 1,240.3 1,256.2 1,270.3 15 Total loans sold to affiliates3.... 2.9 2.4 2.9 2.9 3.0 2.9 2.9 2.4 2.9 2.9 3.0 2.9 16 Commercial and industrial loans plus loans sold4-5 394.5 415.5 458.7 461.8 463.3 466.8 396.8 417.9 457.2 459.1 462.9 467.6 17 Commercial and industrial loans sold5 2.3 1.8 2.0 2.1 2.2 2.1 2.3 1.8 2.0 2.1 2.2 2.1 18 Acceptances held 8.5 8.3 10.0 10.0 9.4 9.5 9.5 9.1 10.0 9.7 9.4 9.3 19 Other commercial and industrial loans 383.7 405.4 446.6 449.7 451.8 455.3 385.1 407.0 445.2 447.3 451.3 456.2 20 To U.S. addressees6 373.4 395.2 434.1 437.3 439.7 443.6 372.6 394.4 433.2 435.2 439.4 444.4 21 To non-U.S. addressees.... 10.3 10.3 12.5 12.4 12.1 11.7 12.4 12.6 12.0 12.1 11.9 11.8 22 Loans to foreign banks 13.5 12.7 12.5 12.4 11.5 11.6 14.5 13.6 12.2 11.9 11.8 11.8 1. Includes domestically chartered banks; U.S. branches and agencies of 5. Loans sold are those sold outright to a bank's own foreign branches, foreign banks, New York investment companies majority owned by foreign nonconsolidated nonbank affiliates of the bank, the bank's holding company (if banks, and Edge Act corporations owned by domestically chartered and foreign not a bank), and nonconsolidated nonbank subsidiaries of the holding company. banks. 6. United States includes the 50 states and the District of Columbia. 2. Beginning December 1981, shifts of foreign loans and securities from U.S. NOTE. Data are prorated averages of Wednesday estimates for domestically banking offices to international banking facilities (IBFs) reduced the levels of chartered banks, based on weekly reports of a sample of domestically chartered several items. Seasonally adjusted data that include adjustments for the amounts banks and quarterly reports of all domestically chartered banks. For foreignshifted from domestic offices to IBFs are available in the Board's G.7 (407) related institutions, data are averages of month-end estimates based on weekly statistical release (available from Publications Services, Board of Governors of reports from large agencies and branches and quarterly reports from all agencies, the Federal Reserve System, Washington, D.C. 20551). branches, investment companies, and Edge Act corporations engaged in banking. 3. Excludes loans to commercial banks in the United States. These data also appear in the Board's G.7 (407) release. For address, see inside 4. Beginning Sept. 19, 1984, a reclassification of loans decreased commercial front cover. and industrial loans and increased real estate loans by $200 million. Beginning Sept. 26, 1984, a transfer of loans from Continental Illinois National Bank to the FDIC reduced total loans and investments and total loans $1.9 billion, commercial and industrial loans $1.4 billion, and real estate loans $.4 billion. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions A17 1.24 MAJOR NONDEPOSIT FUNDS OF COMMERCIAL BANKS' Monthly averages, billions of dollars 1981 1982 1983 1984 SSoouurrccee Dec. Dec. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Total nondeposit funds 1 Seasonally adjusted2 82.9 96.3 100.3 98.2 102.3 108.1 111.7 116.7 105.3 110055..99 109.6' 112.8 111155..66 2 Not seasonally adjusted 84.9 99.6 102.5 99.3 103.8 109.5 112.9 121.0 108.2 106.3 112.2' 113.6 116.6 Federal funds, RPs, and other borrowings from nonbanks3 3 Seasonally adjusted 127.7 140.8 140.7 139.4 143.0 141.8 142.3 142.4 136.8 137.5 142.7 145.0 114455..77 4 Not seasonally adjusted 129.7 144.1 142.8 140.4 144.5 143.3 143.5 146.7 139.6 137.8 145.3 145.8 146.6 5 Net balances due to foreign-related institutions, not seasonally adjusted -47.7 -47.0 -42.7 -43.6 -43.2 -36.9 -33.8 -28.5 -34.1 -34.4 -SE.O' --3355..22 --3333..00 6 Loans sold to affiliates, not seasonally adjusted4 2.9 2.5 2.4 2.4 2.5 3.1 3.1 2.8 2.7 2.9 2.9 3.0 22..99 MEMO 7 Domestically chartered banks' net positions with own foreign branches, not seasonally adjusted5 -39.6 -43.0 -39.8 -38.8 -39.0 -34.9 -33.2 -29.9 -32.9 -33.1 -35.0 -35.1 --3344..00 8 Gross due from balances 72.2 76.5 75.3 73.2 74.7 73.8 73.6 73.5 73.8 71.2 72.8 71.4 69.7 9 Gross due to balances 32.6 33.6 35.5 34.5 35.7 38.8 40.3 43.6 40.9' 38.1 37.8 36.3 35.7 10 Foreign-related institutions' net positions with directly related institutions, not seasonally adjusted6 -8.1 -4.0 -3.0 -4.8 -4.2 -1.9 -.6 1.4 -1.2' -1.3 - l.C .0' 11..00 11 Gross due from balances 54.7 53.5 54.1 53.4 53.0 50.2 49.7 50.0 51.0 52.2 52.0 51.9 50.9 12 Gross due to balances 46.6 49.5 51.1 48.6 48.8 48.3 49.2 51.4 49.8 50.9 SNY 51.9 51.9 Security RP borrowings 13 Seasonally adjusted' 71.0 83.3 84.8 85.5 86.9 85.5 86.9 84.0 79.0 79.9 82.7 84.2 8855..88 14 Not seasonally adjusted 71.2 84.6 85.1 84.6 86.5 85.1 86.2 86.4 80.0 78.4 83.4 83.1' 84.8 U.S. Treasury demand balances8 15 Seasonally adjusted 12.8 12.0 13.1 16.5 20.6 16.7 15.9 12.2 12.9 11.7 12.7 16.5' 181..30 16 Not seasonally adjusted 10.8 7.5 10.8 19.6 22.3 17.5 16.5 12.8 12.3' 11.8 10.3 17.5 Time deposits, $100,000 or more9 17 Seasonally adjusted 347.9 280.7 283.1 284.4 283.8 289.2 292.4 302.9 312.8 315.8' 313.4' 312.8' 331188..00 18 Not seasonally adjusted 354.6 283.0 288.1 287.1 285.0 288.8 288.7 298.8 307.7 311.7' 314.3' 315.4' 320.7 1. Commercial banks are those in the 50 states and the District of Columbia banks and averages of current and previous month-end data for foreign-related with national or state charters plus agencies and branches of foreign banks, New institutions. York investment companies majority owned by foreign banks, and Edge Act 4. Loans initially booked by the bank and later sold to affiliates that are still corporations owned by domestically chartered and foreign banks. held by affiliates. Averages of Wednesday data. 2. Includes seasonally adjusted federal funds, RPs, and other borrowings from 5. Averages of daily figures for member and nonmember banks. nonbanks and not seasonally adjusted net Eurodollars and loans to affiliates. 6. Averages of daily data. Includes averages of Wednesday data for domestically chartered banks and 7. Based on daily average data reported by 122 large banks. averages of current and previous month-end data for foreign-related institutions. 8. Includes U.S. Treasury demand deposits and Treasury tax-and-loan notes at 3. Other borrowings are borrowings on any instrument, such as a promissory commercial banks. Averages of daily data. note or due bill, given for the purpose of borrowing money for the banking 9. Averages of Wednesday figures. business. This includes borrowings from Federal Reserve Banks and from foreign NOTE. These data also appear in the Board's G. 10 (411) release. For address see banks, term federal funds, overdrawn due from bank balances, loan RPs, and inside front cover. participations in pooled loans. Includes averages of daily figures for member Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A18 DomesticN onfinancial Statistics • January 1985 1.25 ASSETS AND LIABILITIES OF COMMERCIAL BANKING INSTITUTIONS Last-Wednesday-of-Month Series Billions of dollars except for number of banks 1982 1983 AAccccoouunntt Dec. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. DOMESTICALLY CHARTERED COMMERCIAL BANKS1 1 Loans and securities, excluding interbank 1,370.3 1,392.2 1,403.8 1,411.9 1,435.1 1,437.4 1,457.0 1,466.1 1,483.0 1,502.3 1,525.2 2 Loans, excluding interbank 1,000.7 1,001.7 1,005.1 1,007.5 1,025.6 1,029.1 1,043.4 1,049.7 1,060.3 1,075.5 1,095.1 3 Commercial and industrial 356.7 358.0 357.9 356.7 360.1 361.1 363.0 364.0 367.0 372.8 380.8 4 Other 644.0 643.7 647.2 650.8 665.6 668.0 680.4 685.7 693.3 702.7 714.4 5 U.S. Treasury securities 129.0 150.6 155.5 160.9 166.0 165.1 167.5 171.2 176.8 180.4 181.4 6 Other securities 240.5 239.9 243.3 243.5 243.5 243.3 246.1 245.2 245.9 246.4 248.7 7 Cash assets, total 184.4 168.9 170.1 164.5 176.9 168.7 176.9 160.0 164.0 179.0 190.5 8 Currency and coin 23.0 19.9 20.4 20.3 21.3 20.7 21.0 20.8 20.5 22.3 23.3 9 Reserves with Federal Reserve Banks 25.4 20.5 23.9 22.4 18.8 20.6 22.5 15.4 19.7 17.6 18.6 10 Balances with depository institutions . 67.6 67.1 66.1 65.6 69.7 67.1 69.0 66.7 67.1 70.9 75.6 11 Cash items in process of collection ... 68.4 61.5 59.6 56.3 67.1 60.3 64.4 56.9 56.6 69.0 73.0 12 Other assets2 265.3 257.9 252.4 248.3 253.2 254.5 257.2 252.3 253.0 261.9 253.8 13 Total assets/total liabilities and capital . .. 1,820.0 1,818.9 1,826.3 1,824.8 1,865.2 1,860.6 1,891.0 1,878.4 1,900.0 1,943.9 1,969.5 14 Deposits 1,361.8 1,374.2 1,368.0 1,370.8 1,402.7 1,396.5 1,420.1 1,408.1 1,419.5 1,459.2 1,482.6 15 Demand 363.9 333.4 329.2 324.5 344.4 334.2 344.7 328.1 331.3 358.1 371.0 16 Savings 296.4 419.2 426.9 440.2 445.3 447.5 449.0 448.8 451.5 458.3 460.7 17 Time 701.5 621.6 611.9 606.1 613.1 614.8 626.4 631.2 636.8 642.8 650.8 18 Borrowings 215.1 211.3 224.0 214.1 221.2 217.5 217.2 217.8 226.8 219.7 216.3 19 Other liabilities 109.2 103.5 102.3 104.7 104.3 105.5 107.6 107.1 106.5 112.6 117.9 20 Residual (assets less liabilities) 133.8 130.0 132.0 135.1 137.0 141.0 146.1 145.4 147.2 152.4 152.8 MEMO 21 U.S. Treasury note balances included in borrowing 10.7 9.6 17.8 2.7 19.3 19.3 14.8 20.8 22.5 2.8 8.8 22 Number of banks 14,787 14,819 14,823 14,817 14,826 14,785 14,795 14,804 14,800 14,799 14,796 ALL COMMERCIAL BANKING INSTITUTIONS3 23 Loans and securities, excluding interbank 1,429.7 1,451.3 1,460.8 1,467.6 1,491.5 1,494.1 1,515.4 1,525.4 1,541.8 1,563.2 1,586.8 24 Loans, excluding interbank 1,054.8 1,054.5 1,055.7 1,056.4 1,075.2 1,078.8 1,094.9 1,102.5 1,112.2 1,129.2 1,149.3 25 Commercial and industrial 395.3 395.9 393.5 391.7 395.3 397.7 400.6 402.7 405.3 412.0 420.1 26 Other 659.5 658.6 662.2 664.7 679.9 681.2 694.3 699.8 706.8 717.2 729.2 27 U.S. Treasury securities 132.8 155.3 160.2 166.1 171.3 170.3 172.7 176.1 182.0 185.9 186.9 28 Other securities 242.1 241.5 244.9 245.2 245.1 245.0 247.8 246.9 247.7 248.1 250.6 29 Cash assets, total 200.7 185.5 186.3 180.3 193.5 185.2 193.3 174.7 178.4 195.0 205.0 30 Currency and coin 23.0 19.9 20.4 20.3 21.3 20.7 21.1 20.9 20.5 22.3 23.4 31 Reserves with Federal Reserve Banks 26.8 22.0 25.4 23.8 20.0 21.9 24.0 16.6 20.8 19.1 19.7 32 Balances with depository institutions . 81.4 81.0 79.8 78.9 84.0 81.2 82.8 79.3 79.5 83.6 88.0 33 Cash items in process of collection ... 69.4 62.6 60.7 57.3 68.2 61.4 65.4 58.0 57.6 70.0 74.0 34 Other assets2 341.7 325.4 317.8 309.5 318.1 318.7 324.6 320.9 318.8 329.7 321.3 35 Total assets/total liabilities and capital ... 1,972.1 1,962.2 1,964.9 1,957.4 2,003.2 1,998.0 2,033.3 2,021.0 2,039.1 2,088.0 2,113.1 36 Deposits 1,409.7 1,419.5 1,411.0 1,413.1 1,443.8 1,438.1 1,461.4 1,448.9 1,459.0 1,499.4 1,524.8 37 Demand 376.2 345.7 341.1 336.4 356.4 346.4 356.6 340.0 343.2 369.9 383.2 38 Savings 296.7 419.7 427.3 440.7 445.7 448.0 449.5 449.3 452.0 458.8 461.3 39 Time 736.7 654.1 642.6 636.0 641.6 643.8 655.3 659.5 663.8 670.6 680.4 40 Borrowings 278.3 269.9 281.3 269.5 278.2 277.9 280.5 282.6 289.6 282.5 275.1 41 Other liabilities 148.4 141.1 138.6 137.9 142.3 139.1 143.4 142.3 141.5 151.9 158.6 42 Residual (assets less liabilities) 135.7 131.9 133.9 137.0 138.9 142.9 148.0 147.3 149.1 154.2 154.7 MEMO 43 U.S. Treasury note balances included in borrowing 10.7 9.6 17.8 2.7 19.3 19.3 14.8 20.8 22.5 2.8 8.8 44 Number of banks 15,329 15,376 15,390 15,385 15,396 15,359 15,370 15,382 15,383 15,382 15,380 1. Domestically chartered commercial banks include all commercial banks in NOTE. Figures are partly estimated. They include all bank-premises subsidiarthe United States except branches of foreign banks; included are member and ies and other significant majority-owned domestic subsidiaries. Data for domestinonmember banks, stock savings banks, and nondeposit trust companies. cally chartered commercial banks are for the last Wednesday of the month. Data 2. Other assets include loans to U.S. commercial banks. for other banking institutions are estimates made on the last Wednesday of the 3. Commercial banking institutions include domestically chartered commercial month based on a weekly reporting sample of foreign-related institutions and banks, branches and agencies of foreign banks, Edge Act and Agreement quarter-end condition report data. corporations, and New York State foreign investment corporations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Commercial Banks A19 1.26 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS with Domestic Assets of $1.4 Billion or More on December 31, 1982, Assets and Liabilities Millions of dollars, Wednesday figures 1984 AAccccoouunntt Sept. 19 Sept. 26' Oct. 3' Oct. 10' Oct. 17' Oct. 24 Oct. 31 Nov. 7 Nov. 14 1 Cash and balances due from depository institutions 85,682 83,752 89,656 92,938 88,207 80,402 87,341 9955,,334466 9988,,664455 2 Total loans, leases and securities, net 780,956 779,648 780,278 787,040 779,722 784,112 797,851 799,904 799,855 Securities 3 U.S. Treasury and government agency 76,183 75,342 74,077 75,415 75,935 73,392 78,441 7777,,006611 7777,,222233 4 Trading account 12,961 12,032 11,148 12,499 12,664 10,675 15,125 13,774 14,017 5 Investment account, by maturity 63,222 63,310 62,928 62,916 63,271 62,717 63,316 63,287 63,206 6 One year or less 17,181 17,293 18,318 18,361 18,565 18,227 18,308 18,766 18,970 7 Over one through five years 33,765 33,800 32,421 32,399 32,675 32,354 32,883 32,436 32,140 8 Over five years 12,277 12,217 12,189 12,156 12,031 12,137 12,126 12,085 12,096 9 Other securities 48,367 49,079 47,748 47,346 47,558 48,141 47,816 47,129 47,341 1100 5,274 5,863 4,717 4,151 4,385 4,678 4,560 4,063 4,435 1111 Investment account 43,093 43,216 43,031 43,195 43,173 43,463 43,256 43,066 42,906 1? States and political subdivisions, by maturity 39,300 39,373 39,124 39,231 39,219 39,402 39,239 38,916 38,852 N One year or less 4,586 4,686 4,646 4,604 4,502 4,602 4,591 4,512 4,458 14 Over one year 34,714 34,686 34,477 34,627 34,717 34,800 34,648 34,404 34,394 15 Other bonds, corporate stocks, and securities 3,793 3,843 3,908 3,964 3,954 4,061 4,017 4,150 4,054 16 Other trading account assets 2,910 3,041 2,820 2,506 2,869 2,764 2,855 3,177 3,763 Loans and leases 17 Federal funds sold1 47,820 47,734 47,501 52,683 45,707 51,435 54,276 55,643 53,261 18 To commercial banks 34,196 34,591 34,572 37,817 31,923 36,586 38,379 38,614 36,580 19 To nonbank brokers and dealers in securities 8,588 8,912 8,664 10,107 9,138 10,158 10,965 11,043 11,401 70 5,036 4,231 4,265 4,758 4,646 4,691 4,931 5,985 5,279 71 Other loans and leases, gross2 621,412 619,689 623,496 624,478 623,102 623,868 630,054 632,575 633,953 77 Other loans, gross2 609,202 607,457 611,220 612,221 610,818 611,590 617,729 620,224 621,610 73 Commercial and industrial2 245,971' 243,924 246,318 246,418 245,535 245,944 246,932 248,867 248,574 74 Bankers acceptances and commercial paper 3,472 3,210 3,607 3,475 3,608 3,343 3,882 3,860 3,914 75 All other 242,500' 240,714 242,710 242,943 241,928 242,601 243,050 245,007 244,660 76 U.S. addressees 236,047' 234,191 236,079 236,352 235,376 235,999 236,431 238,366 238,043 77 Non-U.S. addressees 6,452 6,523 6,631 6,591 6,551 6,601 6,619 6,641 6,618 78 Real estate loans2 154,713 155,021 155,112 155,555 156,190 156,450 157,130 157,228 157,848 79 To individuals for personal expenditures 104,287 104,740 105,139 105,052 105,739 106,279 106,879 107,147 107,354 30 To depository and financial institutions 40,265 39,856 39,830 39,803 39,722 38,442 40,048 40,332 41,352 31 Commercial banks in the United States 8,848 9,375 8,792 9,210 9,081 8,197 8,980 8,998 9,628 32 Banks in foreign countries 5,971 5,969 6,097 5,928 6,132 6,090 6,206 6,336 6,755 33 Nonbank depository and other financial institutions. 25,446 24,513 24,940 24,665 24,510 24,154 24,862 24,997 24,970 34 For purchasing and carrying securities 12,921 13,345 13,376 14,554 12,967 14,086 15,275 15,258 14,135 35 To finance agricultural production 7,480 7,427 7,446 7,408 7,326 7,274 7,228 7,209 7,251 36 To states and political subdivisions 25,775' 25,957 25,588 25,548 25,621 25,463 25,645 25,875 25,982 37 To foreign governments and official institutions .... 4,607' 4,469 4,368 4,457 4,412 4,347 4,423 4,378 4,316 38 All other 13,181' 12,717 14,045 13,425 13,304 13,307 14,168 13,930 14,798 39 Lease financing receivables 12,210 12,232 12,276 12,257 12,284 12,278 12,325 12,350 12,343 40 LESS: Unearned income 5,191 5,174 5,138 5,143 5,161 5,170 5,181 5,140 5,123 41 Loan and lease reserve2 10,544 10,064 10,226 10,244 10,288 10,320 10,409 10,541 10,562 47 Other loans and leases, net2 605,676 604,451 608,132 609,091 607,653 608,379 614,464 616,893 618,268 43 All other assets 139,598 138,345 139,551 138,242 134,211 133,756 140,119 136,862 131,681 44 Total assets 1,006,237 1,001,746 1,009,484 1,018,221 1,002,140 998,270 1,025,312 1,032,112 1,030,182 Deposits 45 179,456 176,232 186,158 192,112 178,974 175,735 184,952 188,100 194,717 46 Individuals, partnerships, and corporations 135,135 132,632 139,271 145,167 137,264 132,901 141,378 142,582 149,410 47 States and political subdivisions 4,822 4,519 4,867 4,592 4,946 4,592 4,896 5,142 4,732 48 U.S. government 4,119 2,222 3,936 1,432 1,124 2,638 1,394 2,156 1,682 49 Depository institutions in United States 20,352 21,187 22,540 25,517 20,828 21,084 21,042 21,229 23,150 50 Banks in foreign countries 5,847 5,666 6,278 6,238 5,855 6,001 6,470 6,783 6,612 51 Foreign governments and official institutions 963 1,016 752 859 812 895 916 897 889 57 Certified and officers' checks 8,218 8,990 8,513 8,307 8,146 7,624 8,856 9,311 8,240 53 Transaction balances other than demand deposits (ATS, NOW, Super NOW, telephone transfers).. 32,832 31,789 33,887 33,723 33,065 32,356 32,998 34,175 33,338 54 436,966 439,754 440,744 441,639 442,593 443,821 443,805 444,596 444,152 55 Individuals, partnerships and corporations 404,146 405,992 407,478 407,975 408,554 410,128 410,066 411,001 410,460 56 States and political subdivisions 21,398 21,571 21,285 21,677 21,758 21,803 21,528 21,186 21,244 57 U.S. government 331 332 340 354 371 360 464 468 516 58 Depository institutions in the United States 7,569 8,352 8,328 8,424 8,656 8,369 8,492 8,598 8,526 59 Foreign governments, official institutions and banks .. 3,522 3,507 3,312 3,209 3,254 3,161 3,255 3,342 3,404 60 Liabilities for borrowed money 195,335 192,766 188,526 189,986 184,490 185,217 200,611 204,644 195,741 61 Borrowings from Federal Reserve Banks 6,990 4,000 5,110 5,275 5,893 4,620 4,550 11,739 4,639 67 Treasury tax-and-loan notes 14,446 16,612 7,974 2,925 2,403 7,093 14,203 3,969 4,743 63 All other liabilities for borrowed money3 173,900 172,154 175,442 181,786 176,194 173,505 181,858 188,936 186,359 64 Other liabilities and subordinated note and debentures 94,047 92,427 90,823 90,915 93,299 91,410 92,880 90,361 92,016 65 Total liabilities 938,637 932,969 940,138 948,376 932,420 928,540 955,246 961,876 959,963 66 Residual (total assets minus total liabilities)4 67,600 68,777 69,346 69,845 69,720 69,729 70,066 70,236 70,219 1. Includes securities purchased under agreements to resell. 4. This is not a measure of equity capital for use in capital adequacy analysis or 2. Levels of major loan items were affected by the Sept. 26, 1984 transaction for other analytic uses. between Continental Illinois National Bank and the Federal Deposit Insurance NOTE. These data also appear in the Board's H.4.2 (504) release. For address, Corporation. For details see the H.4.2 statistical release dated Oct. 5, 1984. see inside front cover. 3. Includes federal funds purchased and securities sold under agreements to repurchase; for information on these liabilities at banks with assets of $1 billion or more on Dec. 31, 1977, see table 1.13. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 Domestic Nonfinancial Statistics • January 1985 1.28 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1984 AAccccoouunntt Sept. 19 Sept. 26 Oct. 3 Oct. 10 Oct. 17 Oct. 24 Oct. 31 Nov. 7 Nov. 14 1 Cash and balances due from depository institutions .... 21,670 20,334 22,121 21,562 22,345 19,651 21,726 25,886 23,786 2 Total loans, leases and securities, net1 165,256 164,874 165,072 168,071 164,359' 165,793 171,620 170,813 169,741 Securities 3 4 5 Investment account, by maturity 9,549 9,598 9,547 9,608 9,584 9,408 9,844 9,482 9,428 6 One year or less 1,671 1,667 1,592 1,593 1,611 1,525 1,532 1,560 2,028 7 Over one through five years 6,531 6,580 6,608 6,671 6,706 6,468 6,836 6,506 5,964 8 Over five years 1,346 1,351 1,348 1,344 1,268 11,,441166 11,,447755 11,,441166 1,436 4 10 11 Investment account 9,650 9,685 9,679 9,712 9,642 9,726 9,454 9,382 9,310 12 States and political subdivisions, by maturity 8,948 8,970 8,937 8,954 8,856 8,956 8,679 8,601 8,543 13 One year or less 1,465 1,485 1,455 1,470 1,342 1,418 1,315 1,281 1,218 14 Over one year 7,483 7,485 7,482 7,484 7,514 7,538 7,363 7,320 7,325 15 Other bonds, corporate stocks and securities 701 715 741 758 786 770 775 780 767 1166 Loans and leases 17 Federal funds sold3 14,186 14,966 14,202 16,451 15,075 16,180 19,757 19,365 17,735 18 To commercial banks 7,798 8,811 8,094 9,311 8,313 8,926 12,237 11,359 9,603 19 To nonbank brokers and dealers in securities 3,605 3,701 3,869 4,596 3,980 4,689 4,970 4,973 5,338 20 To others 2,783 2,453 2,239 2,544 2,782 2,565 2,550 3,033 2,794 21 Other loans and leases, gross 136,598 135,260 136,248 136,924 134,693' 135,138 137,203 137,267 137,970 22 Other loans, gross 134,416 133,069 134,055 134,744 132,511' 132,961 135,025 135,094 135,796 23 Commercial and industrial 65,374 64,118 64,942 65,097 64,115 64,288 64,021 64,437 64,290 24 Bankers acceptances and commercial paper 637 511 590 550 622 598 644 576 590 25 All other 64,737 63,608 64,352 64,546 63,493 63,690 63,377 63,861 63,700 26 U.S. addressees 63,757 62,644 63,320 63,506 62,512 62,672 62,351 62,798 62,598 27 Non-U.S. addressees 980 964 1,032 1,040 982 1,018 1,026 1,063 1,102 28 Real estate loans 23,017 23,188 23,125 23,143 23,242 23,356 23,597 23,567 23,781 29 To individuals for personal expenditures 15,198 15,215 15,238 15,271 15,313 15,359 15,451 15,498 15,543 30 To depository and financial institutions 12,003 11,909 11,746 11,703 11,701' 11,225 11,701 11,753 12,791 31 Commercial banks in the United States 1,593 1,912 1,487 1,486 1,447' 1,116 1,582 1,403 2,149 32 Banks in foreign countries 1,987 2,063 2,167 2,174 2,229' 2,153 2,095 2,222 2,515 33 Nonbank depository and other financial institutions . 8,422 7,935 8,092 8,043 8,026 7,956 8,023 8,127 8,126 34 For purchasing and carrying securities 6,242 6,365 6,323 7,226 5,791' 6,523 7,792 7,414 6,649 35 To finance agricultural production 342 342 357 356 379 386 364 364 353 36 To states and political subdivisions 8,097 8,150 7,963 7,860 7,843 77,,772211 7,702 7,768 7,809 37 To foreign governments and official institutions .... 898r 776 734 876 858' 880088 918 875 828 38 All other 3,244' 3,005 3,627 3,212 3,269' 3,294 3,480 3,418 3,752 39 Lease financing receivables 2,182 2,191 2,193 2,180 2,182 2,177 2,178 2,173 2,173 40 LESS: Unearned income 1,546 1,506 1,484 1,480 1,485 1,488 1,472 1,467 1,474 41 Loan and lease reserve 3,180 3,128 3,120 3,144 3,151 3,171 3,165 3,215 3,229 42 Other loans and leases, net 131,872 130,626 131,644 132,300 130,057' 130,478 132,566 132,584 133,267 43 All other assets4 67,787 67,624 67,013 67,305 65,217' 64,419 71,134 69,303 65,545 44 Total assets 254,712 252,832 254,206 256,938 251,921' 249,863 264,480 266,003 259,072 Deposits 4455 Demand deposits 46,684 46,136 46,223 48,347 45,089' 45,249 48,564 49,054 50,512 46 Individuals, partnerships, and corporations 31,099 29,686 30,549 32,240 30,648' 30,012 32,744 32,641 34,724 47 States and political subdivisions 620 658 838 725 657 667 578 722 672 48 U.S. government 785 452 850 225 135 490 196 288 244 49 Depository institutions in the United States 4,805 5,406 4,706 5,984 4,761' 5,112 4,935 4,650 5,249 50 Banks in foreign countries 4,571 4,328 4,910 4,790 4,498' 4,740 5,213 5,429 5,312 51 Foreign governments and official institutions 743 744 511 649 595' 612 673 631 629 52 Certified and officers' checks 4,060 4,863 3,859 3,735 3,794 3,616 4,224 44,,669922 33,,668822 53 Transaction balances other than demand deposits ATS, NOW, Super NOW, telephone transfers) .. 3,565 3,418 3,599 3,626 3,513 3,472 3,493 3,679 3,558 54 Nontransaction balances 81,400 81,428 81,560 81,038 81,479' 81,358 81,874 81,944 81,937 55 Individuals, partnerships and corporations 72,885 72,875 73,227 72,696 72,944 73,018 73,388 73,407 73,452 56 States and political subdivisions 4,107 4,139 4,258 4,325 4,371 4,313 4,315 4,209 4,101 57 U.S. government 25 24 23 27 29 30 29 29 84 58 Depository institutions in the United States 2,419 2,418 2,264 2,224 2,325 2,245 2,321 2,389 2,345 59 Foreign governments, official institutions and banks .. 1,965 1,972 1,788 1,765 1,811 1,752 1,821 1,909 1,955 60 Liabilities for borrowed money 61,963 61,362 61,935 62,752 59,033 58,700 67,882 70,070 60,724 61 400 800 4,432 62 Treasury tax-and-loan notes 3,677 4,084 1,816 582 484 1,791 3,628 890 1,355 63 All other liabilities for borrowed money5 58,285 57,278 60,118 62,171 58,548 56,508 63,454 64,748 59,369 64 Other liabilities and subordinated note and debentures.. 38,768 38,162 38,287 38,444 40,113' 38,353 39,847 38,367 39,392 65 Total liabilities 232,380 230,506 231,604 234,206 229,227' 227,132 241,659 243,114 236,124 66 Residual (total assets minus total liabilities)6 22,333 22,326 22,602 22,732 22,695 22,731 22,821 22,889 22,949 1. Excludes trading account securities. 6. Not a measure of equity capital for use in capital adequacy analysis or for 2. Not available due to confidentiality. other analytic uses. 3. Includes securities purchased under agreements to resell. NOTE. These data also appear in the Board's H.4.2 (504) release. For address, 4. Includes trading account securities. see inside front cover. 5. Includes federal funds purchased and securities sold under agreements to repurchase. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Commercial Banks A21 1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS Balance Sheet Memoranda Millions of dollars, Wednesday figures 1984 AAccccoouunntt Sept. 19 Sept. 26 Oct. 3 Oct. 10 Oct. 17' Oct. 24 Oct. 31 Nov. 7 Nov. 14 BANKS WITH ASSETS OF $1.4 BILLION OR MORE 1 Total loans and leases (gross) and investments adjusted1 753,648 750,921' 752,278' 755,401' 754,168 754,818 766,082 767,972 769,333 2 Total loans and leases (gross) adjusted1-2 626,188 623,458' 627,633' 630,134' 627,806 630,520 636,970 640,604 641,005 3 Time deposits in amounts of $100,000 or more 157,098 159,611' 159,215' 159,507' 160,151 160,664 159,141 158,526 158,289 4 Loans sold outright to affiliates—total3 3,042 2,972 2,992 2,961 2,982 3,001 2,817 2,892 2,911 5 Commercial and industrial 2,179 2,148 2,160 2,105 2,128 2,152 1,972 2,045 2,062 6 Other 863 824 832 855 853 849 845 847 850 7 Nontransaction savings deposits (including MMDAs)... 151,442 151,688' 152,695' 153,443' 153,944 154,582 155,892 157,009 157,580 BANKS IN NEW YORK CITY 8 Total loans and leases (gross) and investments adjusted14 .. 160,590 158,785 160,0% 161,898 159,236 160,410 162,438 162,734 162,692 9 Total loans and leases (gross) adjusted1 141,392 139,502 140,870 142,578 140,008 141,275 143,141 143,870 143,954 10 Time deposits in amounts of $100,000 or more 35,313 34,924 34,868 34,319 34,413 34,178 33,835 33,916 33,857 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, banks. nonconsolidated nonbank affiliates of the bank, the bank's holding company (if 2. Levels of major loan items were affected by the Sept. 26, 1984 transaction not a bank), and nonconsolidated nonbank subsidiaries of the holding company. between Continental Illinois National Bank and the Federal Deposit Insurance 4. Excludes trading account securities. Corporation. For details see the H.4.2 statistical release dated Oct. 5, 1984. NOTE. These data also appear in the Board's H.4.2 (504) release. For address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 Domestic Nonfinancial Statistics • January 1985 1.30 LARGE WEEKLY REPORTING U.S. BRANCHES AND AGENCIES OF FOREIGN BANKS WITH ASSETS OF $750 MILLION OR MORE ON JUNE 30, 1980 Assets and Liabilities Millions of dollars, Wednesday figures • 1984 AAccccoouunntt Sept. 19 Sept. 26 Oct. 3 Oct. 10 Oct. 17 Oct. 24 Oct. 31 Nov. 7 Nov. 14 1 Cash and due from depository institutions . 6,280 6,670 6,082 6,854 5,984 6,221 6,319 6,792 6,530 2 Total loans and securities 45,417 46,654 46,206 46,448 46,862 47,427 43,817 43,992 43,102 3 U.S. Treasury and govt, agency securities 4,330 4,281 4,361' 4,449' 4,300' 4,306 4,337 4,336 4,233 4 Other securities 1,050 1,258 1,037' 1,049' 1,059' 1,058 1,195 1,207 1,286 5 Federal funds sold1 2,262 3,358 2,780 2,911' 3,436 4,081 2,656 3,059 3,072 6 To commercial banks in the United States 2,036 2,999 2,399 2,642 3,126 3,778 2,324 2,726 2,718 7 To others 225 359 381 269' 310 303 332 333 354 8 Other loans, gross 37,775 37,758 38,028 38,038' 38,067 37,982 35,630 35,390 34,511 9 Commercial and industrial 21,041 21,080 21,464 21,362 2211,,333322 2211,,226600 1199,,660000 1199,,334400 1199,,338888 10 Bankers acceptances and commercial paper 3,354 3,264 3,213 3,178 3,019 3,002 1,380 1,358 1,304 11 All other 17,687 17,816 18,251 18,184 18,313 18,258 18,221 17,981 18,084 12 U.S. addressees 16,138 16,190 16,642 16,532 16,679 16,619 16,759 16,500 16,660 13 Non-U.S. addressees 1,550 1,625 1,608 1,651 1,634 1,639 1,462 1,481 1,423 14 To financial institutions 13,111 13,227 13,018 13,196' 12,934 13,106 12,166 12,334 11,486 15 Commercial banks in the United States . 10,644 10,673 10,536 10,611' 10,409 10,573 9,515 9,718 9,049 16 Banks in foreign countries 1,584 1,602 1,523 1,541 1,504 1,481 1,523 1,493 1,519 17 Nonbank financial institutions 882 951 959 1,044 1,022 1,052 1,127 1,124 918 18 To foreign govts, and official institutions .. 725 721 699 709 716 715 712 714 705 19 For purchasing and carrying securities .. 1,067 857 934 791 1,103 904 1,130 978 918 20 All other 1,830 1,872 1,913 1,979 1,981 1,998 2,021 2,023 2,014 21 Other assets (claims on nonrelated parties).. 18,702 18,725 18,530 18,647 18,800 18,873 18,776 18,446 18,360 22 Net due from related institutions 11,074 10,667 10,336 10,791 9,717 9,580 10,099 11,201 10,245 23 Total assets 81,473 82,717 81,154 82,740 81,362 8822,,110022 7799,,001111 8800,,443311 7788,,223377 24 Deposits or credit balances due to other than directly related institutions.... 21,083' 21,438' 21,297' 21,378 21,131 21,293 21,756 22,099 22,414 25 Credit balances 119 123 128 164 126 148 215 130 153 26 Demand deposits 1,742 1,764' 1,612' 1,964 1,632 1,554 1,746 11,,775522 11,,777700 27 Individuals, partnerships, and corporations 859 830' 833 878 880 840 897 924 934 28 Other 883 935 78(K 1,086 752 714 849 828 835 29 Time and savings deposits 19,222' 19,550" 19,557' 19,250 19,373 19,590 19,794 2200,,221177 2200,,449911 30 Individuals, partnerships, and corporations 15,752 16,100 15,998 15,831 15,999 16,262 16,413 16,570 16,891 31 Other 3,470' 3,450' 3,559' 3,419 3,374 33,,332288 33,,338822 33,,664477 33,,559999 32 Borrowings from other than directly related institutions 34,17(K 34,310' 33,427' 34,680 33,286 33,224 29,554 30,338 28,309 33 Federal funds purchased2 10,067 10,418 9,856 11,198 10,148 10,524 1100,,777777 1111,,555588 1100,,557799 34 From commercial banks in the United States 7,668 7,697 7,487 8,760 7,103 7,845 8,644 9,266 8,118 35 From others 2,398 2,720 2,369 2,438 3,045 2,679 2,133 2,291 2,461 36 Other liabilities for borrowed money.... 24,104' 23,892' 23,571' 23,481 23,138 2222,,770000 1188,,777777 1188,,778800 1177,,773300 37 To commercial banks in the United States 20,322' 20,142' 20,048' 19,884 19,598 19,120 17,248 17,128 16,106 38 To others 3,782 3,750 3,522 3,597 3,540 3,580 1,529 1,652 1,624 39 Other liabilities to nonrelated parties 19,470 19,437' 19,196 19,440 19,368 19,295 19,858 19,586 19,320 40 Net due to related institutions 6,750 7,532 7,234' 7,242 7,577 8,290 7,843 8,409 8,194 41 Total liabilities 81,473 82,717 81,154 82,740 81,362 82,102 79,011 80,431 78,237 MEMO 42 Total loans (gross) and securities adjusted3 32,736 32,981 33,271 33,194' 33,327 33,076 31,978 31,548 31,335 43 Total loans (gross) adjusted3 27,355 27,443 27,873 27,696' 27,968 27,712 26,446 26,005 25,817 • Levels of many asset and liability items were revised beginning Oct. 31, 3. Exclusive of loans to and federal funds sold to commercial banks in the 1984. For details, see the H.4.2 (504) statistical release dated Nov. 23, 1984. United States. 1. Includes securities purchased under agreements to resell. NOTE. These data also appear in the Board's H.4.2 (504) release. For address, 2. Includes securities sold under agreements to repurchase. see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Commercial Banks A23 1.31 GROSS DEMAND DEPOSITS Individuals, Partnerships, and Corporations1 Billions of dollars, estimated daily-average balances Commercial banks TTyyppee ooff hhoollddeerr 1983 1984 1199779922 11998800 11998811 11998822 DDeecc.. DDeecc.. DDeecc.. DDeecc.. June Sept. Dec. Mar. June Sept. 1 AU holders—Individuals, partnerships, and corporations 302.3 315.5 288.9 291.8 281.9 280.3 293.5 279.3 285.8 284.3 2 Financial business 27.1 29.8 28.0 35.4 34.6 32.1 32.8 31.7 31.7 31.9 3 Nonfinancial business 157.7 162.8 154.8 150.5 146.9 150.2 161.1 150.3 154.9 154.7 4 Consumer 99.2 102.4 86.6 85.9 80.3 77.9 78.5 78.1 78.3 77.2 5 Foreign 3.1 3.3 2.9 3.0 3.0 2.9 3.3 3.3 3.4 3.3 6 Other 15.1 17.2 16.7 17.0 17.2 17.1 17.8 15.9 17.4 17.3 Weekly reporting banks 1983 1984 1199779933 11998800 11998811 11998822 DDeecc.. DDeecc.. DDeecc.. DDeecc.. June Sept. Dec.4 Mar. June Sept. 7 All holders—Individuals, partnerships, and corporations 139.3 147.4 137.5 144.2 139.6 136.3 146.2 139.2 145.3 145.6 8 Financial business 20.1 21.8 21.0 26.7 26.1 23.6 24.2 23.5 23.6 23.7 9 Nonfinancial business 74.1 78.3 75.2 74.3 72.8 72.9 79.8 76.4 79.7 79.4 10 Consumer 34.3 35.6 30.4 31.9 28.5 28.1 29.7 28.4 29.9 30.0 11 Foreign 3.0 3.1 2.8 2.9 2.8 2.8 3.1 3.2 3.2 3.2 12 Other 7.8 8.6 8.0 8.4 9.3 8.9 9.3 7.7 8.9 9.3 1. Figures include cash items in process of collection. Estimates of gross exceeding $750 million as of Dec. 31, 1977. Beginning in March 1979, demand deposits are based on reports supplied by a sample of commercial banks. Types of deposit ownership estimates for these large banks are constructed quarterly on the depositors in each category are described in the June 1971 BULLETIN, p. 466. basis of 97 sample banks and are not comparable with earlier data. The following 2. Beginning with the March 1979 survey, the demand deposit ownership estimates in billions of dollars for December 1978 have been constructed for the survey sample was reduced to 232 banks from 349 banks, and the estimation new large-bank panel; financial business, 18.2; nonfinancial business, 67.2; procedure was modified slightly. To aid in comparing estimates based on the old consumer, 32.8; foreign, 2.5; other, 6.8. and new reporting sample, the following estimates in billions of dollars for 4. In January 1984 the weekly reporting panel was revised; it now includes 168 December 1978 have been constructed using the new smaller sample; financial banks. Beginning with March 1984, estimates are constructed on the basis of 92 business, 27.0; nonfinancial business, 146.9; consumer, 98.3; foreign, 2.8; and sample banks and are not comparable with earlier data. Estimates in billions of other, 15.1. dollars for December 1983 based on the newly weekly reporting panel are: 3. After the end of 1978 the large weekly reporting bank panel was changed to financial business, 24.4; nonfinancial business, 80.9; consumer, 30.1; foreign, 3.1; 170 large commercial banks, each of which had total assets in domestic offices other, 9.5. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 DomesticN onfinancial Statistics • January 1985 1.32 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING Millions of dollars, end of period 19843 IInnssttrruummeenntt 1 D 9 e 7 c 9 . ' D 19 e 8 c 0 . D 19 e 8 c 1 . D 1 e 9 c 8 . 2 2 D 19 e 8 c 3 . May June July Aug. Sept. Oct. Commercial paper (seasonally adjusted unless noted otherwise) 1 All issuers 112,803 124,374 165,829 166,670 188,057 214,431 218,898 221,431 222,448 226,474 227,960 Financial companies4 Dealer-placed paper5 2 Total 17,359 19,599 30,333 34,634 44,943 50,355 51,101 51,157 52,695 5544,,228833 53,388 3 Bank-related (not seasonally adjusted) 2,784 3,561 6,045 2,516 2,441 1,696 1,944 1,799 2,010 1,959 2,060 Directly placed paper6 * 4 Total 64,757 67,854 81,660 84,130 96,548 110,791 109,026 109,076 108,109 110077,,220066 104,655 5 Bank-related (not seasonally adjusted) 17,598 22,382 26,914 32,034 35,566 46,338 43,960 45,090 43,665 41,066 38,112 6 Nonfinancial companies7 30,687 36,921 53,836 47,906 46,566 53,285 58,771 61,198 61,644 64,985 69,917 Bankers dollar acceptances (not seasonally adjusted)8 7 Total 45,321 54,744 69,226 79,543 78,309 79,530 82,067 80,957 79,779 77,928 Holder 8 Accepting banks 9,865 10,564 10,857 10,910 9,355 9,927 10,877 10,708 10,743 11,065 9 Own bills 8,327 8,963 9,743 9,471 8,125 8,422 9,354 8,854 8,823 8,729 10 Bills bought 1,538 1,601 1,115 1,439 1,230 1,504 1,523 1,853 1,920 2,336 Federal Reserve Banks 11 Own account 704 776 195 1,480 418 426 0 0 0 0 12 Foreign correspondents 1,382 1,791 1,442 949 729 679 697 611 632 686 n.a. 13 Others 33,370 41,614 56,731 66,204 68,225 68,924 70,493 69,639 68,404 66,177 Basis 14 Imports into United States 10,270 11,776 14,765 17,683 15,649 16,687 17,301 17,947 17,647 17,196 15 Exports from United States 9,640 12,712 15,400 16,328 16,880 15,938 16,421 15,485 15,871 15,985 16 All other 25,411 30,257 39,060 45,531 45,781 46,906 48,345 47,525 46,260 44,746 1. A change in reporting instructions results in offsetting shifts in the dealer- financing; factoring, finance leasing, and other business lending; insurance placed and directly placed financial company paper in October 1979. underwriting; and other investment activities. 2. Effective Dec. 1, 1982, there was a break in the commercial paper series. The 5. Includes all financial company paper sold by dealers in the open market. key changes in the content of the data involved additions to the reporting panel, 6. As reported by financial companies that place their paper directly with the exclusion of broker or dealer placed borrowings under any master note investors. agreements from the reported data, and the reclassification of a large portion of 7. Includes public utilities and firms engaged primarily in such activities as bank-related paper from dealer-placed to directly placed. communications, construction, manufacturing, mining, wholesale and retail trade, 3. Correction of a previous misclassification of paper by a reporter has created transportation, and services. a break in the series beginning December 1983. The correction adds some paper to 8. Beginning October 1984, the number of respondents in the bankers acceptnonfinancial and to dealer-placed financial paper. ance survey will be reduced from 340 to 160 institutions—those with $50 million or 4. Institutions engaged primarily in activities such as, but not limited to, more in total acceptances. The new reporting group accounts for over 95 percent commercial, savings, and mortgage banking; sales, personal, and mortgage of total acceptances activity. 1.33 PRIME RATE CHARGED BY BANKS on Short-Term Business Loans Percent per annum Effective Date Average Month rate 16.00 1983—Jan. 11 11.00 1982—Jan 15.75 1983—July 15.75 F A e u b g . . 28 8 1 10 1 . .0 50 0 F M e a b r . . . , . v '. 1 1 6 6 . .5 5 6 0 A Se u p g t Apr 16.50 Oct 16.50 1984—Mar. 19 11.50 May 16.50 17.00 Apr. 5 12.00 June 16.50 Dec 16.50 May 8 12.50 July 16.26 16.00 June 25 13.00 Aug 14.39 1984—Jan 15.50 Sept.27 12.75 Sept 13.50 Feb 15.00 Oct. 17 12.50 Oct 12.52 Mar 14.50 29 12.00 Nov 11.85 Apr 14.00 Nov. 9 11.75 Dec 11.50 May 13.50 28 11.25 13.00 1983—Jan. . 11.16 July 12.00 Feb. 10.98 Aug 11.50 Mar. 10.50 Sept Apr. 10.50 Oct May. 10.50 June 10.50 NOTE. These data also appear in the Board's H.15 (519) release. For address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A25 1.34 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, August 6-10, 1984 Size of loan (in thousands of dollars) All Item sizes 1-24 25-49 50-99 100-499 500-999 and over SHORT-TERM COMMERCIAL AND INDUSTRIAL LOANS 1 Amount of loans (thousands of dollars) 36,985,734 951,772 646,703 956,171 2,222,353 1,002,098 31,206,636 2 Number of loans 171,018 119,869 19,238 15,095 11,083 1,501 4,233 3 Weighted-average maturity (months) 1.2 4.0 4.4 3.9 3.6 4.3 ..88 4 With fixed rates .9 3.6 4.3 3.3 1.7 2.5 ..66 5 With floating rates 1.8 5.1 4.7 4.8 4.9 5.5 1.2 6 Weighted-average interest rate (percent per annum) .. 13.29 15.41 15.40 14.81 14.65 14.14 13.01 7 Interquartile range1 12.72-13.47 14.65-16.15 14.37-16.08 13.96-15.43 13.80-15.11 13.65-14.86 12.69-13.17 8 With fixed rates 13.18 15.26 15.29 14.51 14.70 13.65 12.96 9 With floating rates 13.46 15.69 15.54 15.14 14.61 14.35 13.09 Percentage of amount of loans 10 With floating rate 40.4 34.4 4455..22 4488..22 6600..77 7700..11 3377..99 11 Made under commitment 69.4 30.4 45.0 40.5 50.8 67.8 73.4 12 With no stated maturity 9.7 10.3 19.4 15.3 37.4 34.0 6.5 13 With one-day maturity 38.7 .1 .1 .1 1.0 1.0 45.7 1-99 LONG-TERM COMMERCIAL AND INDUSTRIAL LOANS 14 Amount of loans (thousands of dollars) 3,982,434 471,238 350,926 213,024 2,947,246 15 Number of loans 26,744 24,143 1,679 322 601 16 Weighted-average maturity (months) 49.4 35.3 41.7 52.9 52.4 17 With fixed rates 41.6 29.5 45.4 60.9 46.9 18 With floating rates 51.2 41.4 40.8 51.3 53.2 19 Weighted-average interest rate (percent per annum) .. 13.81 16.05 14.68 14.01 13.33 20 Interquartile range1 12.89-14.48 14.75-16.65 13.80-15.50 13.65-14.75 12.82-13.80 21 With fixed rates 14.27 16.16 14.59 14.55 13.01 22 With floating rates 13.70 15.92 14.70 13.91 13.38 Percentage of amount of loans 23 With floating rate 8811..55 4488..00 8800..88 8844..00 8866..77 24 Made under commitment 79.5 47.7 59.0 67.3 88.0 1-24 25-49 50-99 500 and over CONSTRUCTION AND LAND DEVELOPMENT LOANS 25 Amount of loans (thousands of dollars) 3,049,989 221,702 188,964 141,543 1,018,190 1,479,589 26 Number of loans 33,300 21,475 5,296 2,230 3,941 358 27 Weighted-average maturity (months) 9.2 8.8 8.7 18.1 10.1 7.8 28 With fixed rates 8.0 9.8 9.9 30.7 10.6 5.6 29 With floating rates 11.1 5.8 6.7 11.1 9.8 14.9 30 Weighted-average interest rate (percent per annum) .. 14.56 15.35 15.38 15.23 15.05 13.93 31 Interquartile range1 13.24-15.50 14.93-16.09 14.20-15.98 15.00-15.67 13.72-15.52 12.93-14.79 32 With fixed rates 13.96 15.12 14.89 15.52 14.05 13.58 33 With floating rates 15.44 15.97 16.39 15.08 15.68 14.91 Percentage of amount of loans 34 With floating rate 40.4 2277..22 3322..88 6666..22 6611..11 2266..66 35 Secured by real estate 73.3 88.9 83.0 95.0 98.0 50.6 36 Made under commitment 71.6 61.0 37.7 91.1 82.4 68.3 37 With no stated maturity 4.0 61.8 83.0 79.0 6.3 5.1 38 With one-day maturity .2 .5 1.0 2.9 2.9 2.1 Type of construction 39 1- to 4-family 17.9 37.7 16.1 18.1 90.8 9922..88 40 Multifamily 2.2 2.3 18.0 5.9 2.5 3.4 41 Nonresidential 79.9 .0 .0 .0 .0 .4 AAllll ssiizzeess 1-9 10-24 25-49 50-99 100-249 250 and over LLOOAANNSS TTOO FFAARRMMEERRSS 42 Amount of loans (thousands of dollars) 998,347 186,662 122,404 146,481 125,457 152,701 264,643 43 Number of loans 67,803 51,876 8,086 4,675 1,793 929 445 44 Weighted-average maturity (months) 6.6 6.1 6.2 6.3 5.6 5.2 9.1 45 Weighted-average interest rate (percent per annum) .. 14.87 15.05 14.69 14.98 15.10 15.06 14.54 46 Interquartile range1 14.35-15.45 14.49-15.53 14.23-15.03 14.56-15.27 14.65-15.58 14.76-15.56 13.86-15.45 By purpose of loan 47 Feeder livestock 14.63 14.72 1144..5577 1144..8877 1144..4477 1144..8855 1144..5522 48 Other livestock 15.17 15.12 14.16 15.22 (2) (2) (2) 49 Other current operating expenses 14.99 14.88 14.75 15.01 15.41 15.32 14.66 50 Farm machinery and equipment 14.96 15.24 14.54 14.57 (2) (2) (2) 51 14.38 16.77 15.11 14.90 14.50 14.50 13.84 1. Interest rate range that covers the middle 50 percent of the total dollar NOTE. For more detail, see the Board's E.2 (111) statistical release, amount of loans made. 2. Fewer than 10 sample loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A26 DomesticN onfinancial Statistics • January 1985 1.35 INTEREST RATES Money and Capital Markets Averages, percent per annum; weekly and monthly figures are averages of business day data unless otherwise noted. 1984 1984, week ending IInnssttrruummeenntt 11998811 11998822 11998833 July Aug. Sept. Oct. Sept. 28 Oct. 5 Oct. 12 Oct. 19 Oct. 26 MONEY MARKET RATES 1 Federal funds12 16.38 12.26 9.09 11.23 11.64 11.30 9.99 10.73 11.20 10.01 10.22 9.45 2 Discount window borrowing12 3 13.42 11.02 8.50 9.00 9.00 9.00 9.00 9.00 9.00 9.00 9.00 9.00 Commercial paper4 5 3 1-month 15.69 11.83 8.87 11.06 11.19 11.11 10.05 10.77 10.75 10.36 10.05 9.43 4 3-month 15.32 11.89 8.88 11.19 11.18 11.04 10.12 10.75 10.72 10.45 10.13 9.54 5 6-month 14.76 11.89 8.89 11.34 11.16 10.94 10.16 10.70 10.71 10.49 10.18 9.63 Finance paper, directly placed4 5 6 1-month 15.30 11.64 8.80 10.99 11.16 10.98 9.92 10.45 10.54 10.22 9.90 9.35 7 3-month 14.08 11.23 8.70 10.54 10.61 10.62 9.87 10.45 10.43 10.20 9.88 9.31 8 6-month 13.73 11.20 8.69 10.42 10.52 10.56 9.87 10.41 10.40 10.18 9.88 9.42 Bankers acceptances5 6 9 3-month 15.32 11.89 8.90 11.30 11.23 11.04 10.13 10.78 10.77 10.45 10.13 9.60 10 6-month 14.66 11.83 8.91 11.44 11.13 10.91 10.14 10.71 10.69 10.46 10.15 9.64 Certificates of deposit, secondary market7 11 1-month 15.91 12.04 8.96 11.28 11.32 11.20 10.18 10.90 10.85 10.48 10.21 9.50 12 3-month 15.91 12.27 9.07 11.56 11.47 11.29 10.38 11.00 11.02 10.76 10.39 9.82 13 6-month 15.77 12.57 9.27 12.08 11.71 11.47 10.63 11.22 11.24 10.99 10.63 10.05 14 Eurodollar deposits, 3-month8 16.79 13.12 9.56 12.02 11.81 11.67 10.77 11.40 11.44 11.15 10.73 10.16 U.S. Treasury bills5 Secondary market9 15 3-month 14.03 10.61 8.61 10.12 10.47 10.37 9.74 10.24 10.19 10.01 9.81 9.33 16 6-month 13.80 11.07 8.73 10.53 10.61 10.47 9.87 10.34 10.30 10.12 9.91 9.46 17 1-year 13.14 11.07 8.80 10.89 10.71 10.51 9.93 10.38 10.35 10.15 9.96 9.56 Auction average10 18 3-month 14.029 10.686 8.63 10.13 10.49 10.41 9.97 10.27 10.23 10.11 9.98 9.54 19 6-month 13.776 11.084 8.75 10.58 10.65 10.51 10.05 10.39 10.35 10.21 10.08 9.57 2200 1133..115599 1111..009999 8.86 1100..9999 1100..7799 1100..8844 1100..3322 1100..3322 CAPITAL MARKET RATES U.S. Treasury notes and bonds11 Constant maturities12 21 1-year 14.78 12.27 9.57 12.03 11.82 11.58 10.90 11.42 11.39 11.16 10.93 10.46 22 2-vear 14.56 12.80 10.21 12.88 12.43 12.21 11.60 12.06 12.03 11.82 11.63 11.22 ?3 12.10 12.15 11 70 24 3-year 14.44 12.92 10.45 13.08 12.50 12.34 11.85 12.27 12.26 12.06 11.88 11.48 25 5-year 14.24 13.01 10.80 13.28 12.69 12.53 12.06 12.46 12.46 12.26 12.10 11.69 26 7-year 14.06 13.06 11.02 13.35 12.75 12.60 12.16 12.53 12.56 12.39 12.19 11.80 27 10-year 13.91 13.00 11.10 13.36 12.72 12.52 12.16 12.46 12.51 12.33 12.19 11.85 28 20-year 13.72 12.92 11.34 13.36 12.71 12.42 12.04 12.36 12.40 12.19 12.04 11.74 29 30-year 13.44 12.76 11.18 13.21 12.54 12.29 11.98 12.26 12.31 12.16 12.00 11.68 Composite14 30 Over 10 years (long-term) 12.87 12.23 10.84 12.82 12.23 11.97 11.66 11.93 11.98 11.80 11.68 11.37 State and local notes and bonds Moody's series'5 31 Aaa 10.43 10.88 8.80 10.10 9.58 9.58 9.72 9.55 9.70 9.80 9.80 9.60 32 Baa 11.76 12.48 10.17 10.61 10.30 10.40 10.51 10.40 10.60 10.65 10.50 10.30 33 Bond Buyer series16 11.33 11.66 9.51 10.42 9.99 10.10 10.25 10.15 10.34 10.36 10.24 10.05 Corporate bonds Seasoned issues17 34 All industries 15.06 14.94 12.78 14.32 13.78 13.56 13.33 13.46 13.47 13.40 13.32 13.15 35 Aaa 14.17 13.79 12.04 13.44 12.87 12.66 12.63 12.56 12.62 12.52 12.51 12.54 36 Aa 14.75 14.41 12.42 14.12 13.47 13.27 13.11 13.19 13.23 13.21 13.20 12.95 37 A 15.29 15.43 13.10 14.57 14.13 13.94 13.61 13.84 13.83 13.78 13.63 13.38 38 Baa 16.04 16.11 13.55 15.15 14.63 14.35 13.94 14.24 14.21 14.09 13.94 13.72 39 A-rated, recently-offered utility bonds18 16.63 15.49 12.73 14.93 14.12 13.86 13.52 13.84 13.81 13.70 13.29 13.24 MEMO: Dividend/price ratio19 40 Preferred stocks 12.36 12.53 11.02 12.13 11.77 11.65 11.62 11.57 11.66 11.76 11.56 11.57 41 Common stocks 5.20 5.81 4.40 4.93 4.62 4.54 4.62 4.53 4.67 4.68 4.62 4.54 1. Weekly and monthly figures are averages of all calendar days, where the 11. Yields are based on closing bid prices quoted by at least five dealers. rate for a weekend or holiday is taken to be the rate prevailing on the preceding 12. Yields adjusted to constant maturities by the U.S. Treasury. That is, yields business day. The daily rate is the average of the rates on a given day weighted by are read from a yield curve at fixed maturities. Based on only recently issued, the volume of transactions at these rates. actively traded securities. 2. Weekly figures are averages for statement week ending Wednesday. 13. Each biweekly figure is the average of five business days ending on the 3. Rate for the Federal Reserve Bank of New York. Monday following the date indicated. Until Mar. 31, 1983, the biweekly rate 4. Unweighted average of offering rates quoted by at least five dealers (in the determined the maximum interest rate payable in the following two-week period case of commercial paper), or finance companies (in the case of finance paper). on 2-Vi-year small saver certificates. (See table 1.16.) Before November 1979, maturities for data shown are 30-59 days, 90-119 days, 14. Averages (to maturity or call) for all outstanding bonds neither due nor and 120-179 days for commercial paper; and 30-59 days, 90—119 days, and 150- callable in less than 10 years, including several very low yielding "flower" bonds. 179 days for finance paper. 15. General obligations based on Thursday figures; Moody's Investors Service. 5. Yields are quoted on a bank-discount basis, rather than an investment yield 16. General obligations only, with 20 years to maturity, issued by 20 state and basis (which would give a higher figure). local governmental units of mixed quality. Based on figures for Thursday. 6. Dealer closing offered rates for top-rated banks. Most representative rate 17. Daily figures from Moody's Investors Service. Based on yields to maturity (which may be, but need not be, the average of the rates quoted by the dealers). on selected long-term bonds. 7. Unweighted average of offered rates quoted by at least five dealers early in 18. Compilation of the Federal Reserve. This series is an estimate of the yield the day. on recently-offered, A-rated utility bonds with a 30-year maturity and 5 years of 8. Calendar week average. For indication purposes only. call protection. Weekly data are based on Friday quotations. 9. Unweighted average of closing bid rates quoted by at least five dealers. 19. Standard and Poor's corporate series. Preferred stock ratio based on a 10. Rates are recorded in the week in which bills are issued. Beginning with the sample often issues: four public utilities, four industrials, one financial, and one Treasury bill auction held on Apr. 18, 1983, bidders were required to state the transportation. Common stock ratios on the 500 stocks in the price index. percentage yield (on a bank discount basis) that they would accept to two decimal NOTE. These data also appear in the Board's H. 15 (519) and G. 13 (415) releases. places. Thus, average issuing rates in bill auctions will be reported using two For address, see inside front cover. rather than three decimal places. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A25 1.36 STOCK MARKET Selected Statistics 1984 IInnddiiccaattoorr 11998811 11998822 11998833 Feb. Mar. Apr. May. June July Aug. Sept. Oct. Prices and trading (averages of daily figures) Common stock prices 1 New York Stock Exchange (Dec. 31, 1965 = 50) 74.02 68.93 92.63 90.60 90.66 90.67 90.07 88.28 87.08 94.49 95.68 95.09 2 Industrial 85.44 78.18 107.45 105.44 105.92 106.56 105.94 104.04 102.29 111.20 112.18 110.44 3 Transportation 72.61 60.41 89.36 86.33 86.10 83.61 81.62 79.29 76.72 86.86 86.88 86.82 4 Utility 38.90 39.75 47.00 45.67 44.83 43.86 44.22 43.65 44.17 46.69 47.47 49.02 5 Finance 73.52 71.99 95.34 89.95 89.50 88.22 85.06 80.75 79.03 87.92 91.59 92.94 6 Standard & Poor's Corporation (1941-43 = 10)1 ... 128.05 119.71 160.41 157.70 157.44 157.60 156.55 153.12 151.08 164.42 166.11 164.82 7 American Stock Exchange2 (Aug. 31, 1973 = 100) 171.79 141.31 216.48 207.95 210.09 207.66 206.39 201.24 192.82 207.90 214.50 210.39 Volume of trading (thousands of shares) 8 New York Stock Exchange 46,967 64,617 85,418 96,641 84,328 85,874 88,170 85,920 79,156 109,892 93,108 91,676 9 American Stock Exchange 5,346 5,283 8,215 6,431 5,382 5,863 5,935 5,071 5,141 7,477 5,967 5,587 Customer financing (end-of-period balances, in millions of dollars) 10 Margin credit at broker-dealers3 14,411 13,325 23,000 22,557 22,668 22,830 22,360 23,450 22,980 22,810 22,800 11 Margin stock 14,150 12,980 22,720 22,330 22,460 t t t I t t 12 Convertible bonds 259 344 279 226 208 n.a. n.a. n.a. n.a. 13 Subscription issues 2 1 1 1 Free credit balances at brokers4 14 Margin-account 3,515 5,735 6,620 6,420 6,520 6,450 6,685 6,430 6,430 6,855 6,690' 15 Cash-account 7,150 8,390 8,430 8,420 8,265 7,910 8,115 8,305 8,125 8,185 8,315 Margin-account debt at brokers (percentage distribution, end of period) 16 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 By equity class (in percent)5 1/ Under 40 37.0 21.0 41.0 48.0 46.0 47.0 53.0 50.0 52.0 40.0 42.0 44.0 18 40-49 24.0 24.0 22.0 20.0 20.0 20.0 18.0 19.0 17.0 22.0 22.0 21.0 19 50-59 17.0 24.0 16.0 13.0 14.0 13.0 12.0 12.0 12.0 16.0 15.0 14.0 20 60-69 10.0 14.0 9.0 8.0 9.0 8.0 7.0 8.0 8.0 9.0 9.0 9.0 21 70-79 6.0 9.0 6.0 6.0 6.0 6.0 5.0 6.0 5.0 6.0 6.0 6.0 22 80 or more 6.0 8.0 6.0 5.0 5.0 6.0 5.0 5.0 6.0 7.0 6.0 6.0 Special miscellaneous-account balances at brokers (end of period) 23 Total balances (millions of dollars)6 25,870 35,598 58,329 63,410 65,860 66,340 70,110 69,410 70,588 71,840 72,350 71,914 Distribution by equity status (percent) 24 Net credit status 58.0 62.0 63.0 59.0 61.0 60.0 60.0 56.0 57.0 58.0 58.0 59.0 Debt status, equity of 25 60 percent or more 31.0 29.0 28.0 29.0 28.0 29.0 27.0 30.0 30.0 31.0 31.0 30.0 26 Less than 60 percent 11.0 9.0 9.0 12.0 11.0 11.0 13.0 14.0 13.0 11.0 11.0 11.0 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 2. Beginning July 5, 1983, the American Stock Exchange rebased its index other collateral in the customer's margin account or deposits of cash (usually sales effectively cutting previous readings in half. proceeds) occur. 3. Beginning July 1983, under the revised Regulation T, margin credit at 7. Regulations G, T, and U of the Federal Reserve Board of Governors, broker-dealers includes credit extended against stocks, convertible bonds, stocks prescribed in accordance with the Securities Exchange Act of 1934, limit the acquired through exercise of subscription rights, corporate bonds, and govern- amount of credit to purchase and carry margin stocks that may be extended on ment securities. Separate reporting of data for margin stocks, convertible bonds, securities as collateral by prescribing a maximum loan value, which is a specified and subscription issues was discontinued in April 1984, and margin credit at percentage of the market value of the collateral at the time the credit is extended. broker-dealers became the total that is distributed by equity class and shown on Margin requirements are the difference between the market value (100 percent) lines 17-22. and the maximum loan value. The term "margin stocks" is defined in the 4. Free credit balances are in accounts with no unfulfilled commitments to the corresponding regulation. brokers and are subject to withdrawal by customers on demand. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic Nonfinancial Statistics • January 1985 1.37 SELECTED FINANCIAL INSTITUTIONS Selected Assets and Liabilities Millions of dollars, end of period 1983 1984 AAccccoouunntt 11998811 Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept.? Savings and loan associations 1 Assets 664,167 707,646 763,365 771,705 772,723 780,107 796,095 806,482 823,737 838,825 848,890 858,172 875,698 2 Mortgages 518,547 483,614 490,956 494,789 496,015 499,337 503,509 510,670 519,628 528,172 535,814 540,644 550,129 3 Cash and investment securities' 63,123 85,438 101,553 103,395 101,883 103,917 108,565 105,950 109,102 108,809 107,502 107,855 111,370 4 Other 82,497 138,594 172,259 174,878 176,158 178,203 185,387 191,249 196,421 203,284 207,043 211,160 215,705 5 Liabilities and net worth 664,167 707,646 763,365 771,705 772,723 780,107 796,095 806,482 823,737 838,825 848,890 858,172 875,698 6 Savings capital 525,061 567,961 625,013 634,076 639,694 644,588 656,252 660,262 670,259 681,532 687,396 691,279 704,127 7 Borrowed money 88,782 97,850 89,235 91,443 86,322 86,526 93,321 97,468 102,281 107,554 109,355 113,845 119,067 8 FHLBB 62,794 63,861 51,735 52,626 50,880 50,465 50,663 51,951 53,485 56,558 57,115 60,178 63,627 9 Other 25,988 33,989 37,500 38,817 35,442 36,061 42,658 45,517 48,796 50,996 52,240 53,667 56,727 10 Loans in process2 6,385 9,934 19,728 21,117 21,532 21,974 22,969 23,938 24,761 25,726 26,122 26,773 27,141 11 Other 15,544 15,602 19,179 15,275 15,777 17,520 14,938 16,904 19,207 16,957 19,332 19,957 17,459 12 Net worth3 28,395 26,233 29,938 30,911 30,930 31,473 31,584 31,848 31,990 32,782 32,807 33,091 33,758 13 MEMO: Mortgage loan commitments outstanding4 15,225 18,054 34,780 32,996 33,504 36,198 39,867 41,732 45,274 44,878 43,878 41,182 40,089 Mutual savings banks5 14 Assets 175,728 174,197 189,149 193,535 194,217 195,168 197,178 198,000 200,087 198,864 199,128 200,722 201,445 Loans 15 Mortgage 99,997 94,091 95,600 97,356 97,703 97,895 98,472 99,017 99,881 99,433 100,091 101,211 101,621 16 Other 14,753 16,957 19,675 19,129 20,463 21,694 21,971 22,531 22,907 23,198 23,213 24,068 24,535 Securities 17 U.S. government6 9,810 9,743 15,092 15,360 15,167 15,667 15,772 15,913 16,404 15,448 15,457 15,019 14,965 18 State and local government 2,288 2,470 2,195 2,177 2,180 2,054 2,067 2,033 2,024 2,037 2,037 2,055 2,052 19 Corporate and other7 37,791 36,161 42,629 43,580 43,542 43,439 43,547 43,122 43,200 42,479 42,682 42,632 42,605 20 Cash 5,442 6,919 4,983 6,263 4,788 4,580 5,040 5,008 5,031 5,452 4,896 4,981 4,795 21 Other assets 5,649 7,855 8,975 9,670 10,374 9,839 10,309 10,376 10,640 10,817 10,752 10,756 10,872 22 Liabilities 175,728 174,197 189,149 193,535 194,217 195,168 197,178 198,000 200,087 198,864 199,128 200,722 201,445 23 Deposits 155,110 155,196 169,356 172,665 173,636 174,370 176,044 175,875 176,253 174,972 174,823 176,085 177,345 24 Regular8 153,003 152,777 167,006 170,135 171,099 171,957 173,385 173,010 173,310 171,858 171,740 172,990 174,296 25 Ordinary savings 49,425 46,862 38,448 38,554 37,992 37,642 37,866 37,329 37,147 36,322 35,511 34,787 34,564 26 Time 103,578 96,369 93,073 95,129 96,519 96,005 97,339 96,920 97,236 97,168 98,410 101,270 102,934 27 Other 2,108 2,419 2,350 2,530 2,537 2,413 2,659 2,865 2,943 3,114 3,083 3,095 3,049 28 Other liabilities 10,632 8,336 9,185 10,154 9,917 10,019 10,390 11,211 12,861 12,999 13,269 13,604 12,979 29 General reserve accounts 9,986 9,235 10,210 10,368 10,350 10,492 10,373 10,466 10,554 10,404 10,495 10,498 10,488 30 MEMO: Mortgage loan commitments outstanding9 1,293 1,285 2,418 2,387 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Life insurance companies' 31 Assets 525,803 588,163 649,081 654,948 658,504 660,901 665,836 671,259 673,518 679,449 684,573 694,082 Securities 32 Government 25,209 36,499 48,341 50,752 51,328 51,762 52,504 52,828 53,422 53,970 54,688 56,263 33 United States10 8,167 16,529 26,293 28,636 29,179 30,130 31,056 31,358 31,706 32,066 32,654 33,886 34 State and local 7,151 8,664 9,925 9,986 9,995 9,426 9,259 9,192 9,239 9,213 9,236 9,357 35 Foreign" 9,891 11,306 12,123 12,130 12,154 12,206 12,189 12,278 12,477 12,691 12,798 13,020 255,769 287,126 323,714 322,854 328,075 328,235 331,631 334,634 334,151 338,508 341,802 348,614 n a, 37 Bonds 208,099 231,406 258,757 257,986 263,207 265,798 268,446 271,296 273,212 276,902 281,113 283,673 38 Stocks 47,670 55,720 64,957 64,868 64,868 62,437 63,185 63,338 60,939 61,606 60,689 64,941 39 Mortgages 137,747 141,989 148,487 150,999 151,085 151,020 151,445 152,373 152,968 153,845 154,299 155,438 40 Real estate 18,278 20,264 21,864 22,234 22,500 22,591 23,034 23,237 23,517 23,792 24,019 24,117 41 Policy loans 48,706 52,961 53,979 54,063 54,089 54,170 54,254 54,365 54,399 54,430 54,441 54,517 42 Other assets 40,094 48,571 52,696 54,046 51,939 53,123 52,968 53,822 55,061 54,904 55,324 55,133 Credit unions12 43 Total assetsAiabilities and capital 60,611 69,585 81,203 81,961 82,496 83,726 85,789 86,594 88,350 90,276 90,145 90,503 91,651 39,181 45,493 53,801 54,482 54,770 55,753 57,569 58,127 59,636 61,316 61,163 61,500 62,107 45 State 21,430 24,092 27,402 27,479 27,726 27,973 28,220 28,467 28,714 28,960 28,982 29,003 29,544 46 Loans outstanding 42,333 43,232 49,235 50,083 50,625 51,435 52,269 53,247 54,437 55,915 57,286 58,802 59,874 27,096 27,948 32,304 32,930 33,270 33,878 34,510 35,286 36,274 37,547 38,490 39,578 40,310 48 State 15,237 15,284 16,931 17,153 17,355 17,557 17,759 17,961 18,163 18,368 18,796 19,224 19,564 54,152 62,990 74,202 74,739 75,532 76,556 78,487 79,413 80,702 82,578 82,402 82,135 83,172 50 Federal (shares) 35,250 41,352 49,400 49,889 50,438 51,218 52,905 53,587 54,632 56,261 56,278 56,205 56,734 51 State (shares and deposits) 18,902 21,638 24,802 24,850 25,094 25,338 25,582 25,826 26,070 26,317 26,124 25,930 26,438 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A25 1.37 Continued 1983 1984 AAccccoouunntt 11998811 11998822 Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept.? FSLIC-insured federal savings banks 52 Assets 6,859 61,717 64,969 69,835 72,143 75,555 77,374 78,952 81,310 83,989 87,209 82,174 53 Mortgages 3,353 37,166 38,698 41,754 43,371 44,708 45,900 46,791 48,084 49,996 52,039 48,841 54 Cash and investment securities' 9,653 10,436 11,243 11,662 12,552 12,762 12,814 13,071 13,184 ,13,331 13,393 55 Other 14,898 15,835 16,838 17,110 18,295 18,712 19,347 20,155 20,809 21,839 22,152 56 Liabilities and net worth 6,859 61,717 64,969 69,835 72,143 75,555 77,374 78,952 81,310 83,989 87,209 82,174 57 Savings and capital 5,877 50,384 53,227 57,195 59,107 61,433 62,495 63,026 64,364 66,227 68,443 65,079 58 Borrowed money 6,981 7,477 8,048 8,088 9,213 9,707 10,475 11,489 12,060 12,863 13,219 59 FHLBB 4,381 4,640 4,751 4,884 5,232 5,491 5,900 6,538 6,897 7,654 6,600 60 Other 2,600 2,837 3,297 3,204 3,981 4,216 4,575 4,951 5,163 5,209 5,228 61 Other 1,428 1,157 1,347 1,545 1,360 1,548 1,747 1,646 1,807 1,912 1,610 62 Net worth3 2,924 3,108 3,245 3,403 3,549 3,624 3,704 3,811 3,895 3,991 3,657 MEMO 63 Loans in process2 1,222 1,264 1,387 1,531 1,669 1,716 1,787 1,839 1,901 1,895 1,505 64 Mortgage loan commitments outstanding4 2,230 2,151 2,974 2,704 3,253 3,714 3,763 3,583 3,988 3,860 2,970 1. Holdings of stock of the Federal Home Loan Banks are in "other assets." 11. Issues of foreign governments and their subdivisions and bonds of the 2. Beginning in 1982, loans in process are classified as contra-assets and are International Bank for Reconstruction and Development. not included in total liabilities and net worth. Total assets are net of loans in 12. As of June 1982, data include only federal or federally insured state credit process. unions serving natural perons. 3. Includes net undistributed income accrued by most associations. 4. Excludes figures for loans in process. NOTE. Savings and loan associations: Estimates by the FHLBB for all 5. The National Council reports data on member mutual savings banks and on associations in the United States. Data are based on monthly reports of federally savings banks that have converted to stock institutions, and to federal savings insured associations and annual reports of other associations. Even when revised, banks. data for current and preceding year are subject to further revision. 6. Beginning April 1979, includes obligations of U.S. government agencies. Mutual savings banks: Estimates of National Council of Savings Institutions for Before that date, this item was included in "Corporate and other." all savings banks in the United States. 7. Includes securities of foreign governments and international organizations Life insurance companies: Estimates of the American Council of Life Insurance and, before April 1979, nonguaranteed issues of U.S. government agencies. for all life insurance companies in the United States. Annual figures are annual- 8. Excludes checking, club, and school accounts. statement asset values, with bonds carried on an amortized basis and stocks at 9. Commitments outstanding (including loans in process) of banks in New year-end market value. Adjustments for interest due and accrued and for York State as reported to the Savings Banks Association of the State of New differences between market and book values are not made on each item separately York. but are included, in total, in "other assets." 10. Direct and guaranteed obligations. Excludes federal agency issues not Credit unions: Estimates by the National Credit Union Administration for a guaranteed, which are shown in the table under "Business" securities. group of federal and federally insured state credit unions serving natural persons. Figures are preliminary and revised annually to incorporate recent data. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 Domestic Nonfinancial Statistics • January 1985 1.38 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Calendar year FFiissccaall Fiscal FFiissccaall Type of account or operation yyeeaarr year yyeeaarr 1983 1984 1984 11998822 1983 11998844 HI H2 HI Aug. Sept. Oct. U.S. budget 1 Receipts' 617,766 600,562 666,457 306,331 306,584 341,808 55,209 68,019 52,251 2 Outlays' 728,375 795,917 841,800 396,477 406,849 420,700 88,707 51,234 81,037 3 Surplus, or deficit (-) -110,609 -195,355 -175,343 -90,146 -100,265 -78,892 -33,498 16,785 -28,786 4 Trust funds 5,456 23,056 30,565 22,680 7,745 18,080 -11,045 23,861 10,055 5 Federal funds2 3 -116,065 -218,410 -205,908 -112,822 -108,005 -96,971 -22,453 -7,077 -38,842 Off-budget entities (surplus, or deficit (-)) 6 Federal Financing Bank outlays -14,142 -10,404 -7,277 -5,418 -3,199 -2,813 -755 -467 154 7 Other3'4 -3,190 -1,953 -2,719 -528 -1,206 -838 -419 -1,507 613 U.S. budget plus off-budget, including Federal Financing Bank 8 Surplus, or deficit (-) -127,940 -207,711 -185,339 -96,094 -104,670 -84,884 -34,673 -14,811 -28,019 Source of financing 9 Borrowing from the public 134,993 212,425 170,817 102,538 84,020 80,592 25,340 4,167 20,754 10 Cash and monetary assets (decrease, or increase (-))4 -11,911 -9,889 5,636 -9,664 -16,294 -3,127 -6,295 -18,978 7,564 11 Other5 4,858 5,176 8,885 3,222 4,358 7,418 3,038 -1 -299 MEMO 12 Treasury operating balance (level, end of period) 29,164 37,057 37,057 27,997' 11,817' 13,567' 11,327 30,426 22,345 13 Federal Reserve Banks 10,975 16,557 16,557 19,442 3,661' 4,397' 4,029 8,514 3,791 14 Tax and loan accounts 18,189 20,500 20,500 8,764r 8,157' 9,170' 7,298 21,913 18,553 1. Effective Feb. 8, 1982, supplemental medical insurance premiums and 5. Includes accrued interest payable to the public; allocations of special voluntary hospital insurance premiums, previously included in other insurance drawing rights; deposit funds; miscellaneous liability (including checks outstandreceipts, have been reclassified as offsetting receipts in the health function. ing) and asset accounts; seigniorage; increment on gold; net gain/loss for U.S. 2. Half-year figures are calculated as a residual (total surplus/deficit less trust currency valuation adjustment; net gain/loss for IMF valuation adjustment; and fund surplus/deficit). profit on the sale of gold. 3. Other off-budget includes Postal Service Fund; Rural Electrification and Telephone Revolving Fund; Rural Telephone Bank; and petroleum acquisition SOURCE. "Monthly Treasury Statement of Receipts and Outlays of the U.S. and transportation and strategic petroleum reserve effective November 1981. Government" Treasury Bulletin, and the Budget of the U.S. Government, Fiscal 4. Includes U.S. Treasury operating cash accounts; SDRs; gold tranche Year 1985. drawing rights; loans to International Monetary Fund; and other cash and monetary assets. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A31 1.39 U.S. BUDGET RECEIPTS AND OUTLAYS Millions of dollars Calendar year FFFiiissscccaaalll FFFiiissscccaaalll SSSooouuurrrccceee ooorrr tttyyypppeee yyyeeeaaarrr yyyeeeaaarrr 1982 1983 1984 1984 111999888333 111999888444 H2 HI H2 HI Aug. Sept. Oct. RECEIPTS 1 All sources 600,563 666,457 286,337 306,331 305,122 341,808 55,209 68,019 52,250 2 Individual income taxes, net 288,938 295,955 145,676 144,551 147,663 144,691 25,820 31,541 25,624 3 Withheld 266,010 279,345 131,567 135,531 133,768 140,657 25,072 21,852 24,721 4 Presidential Election Campaign Fund ... 36 35 5 30 6 29 1 1 0 5 Nonwithheld 83,586 81,346 20,041 63,014 20,703 61,463 2,396 11,716 1,463 6 Refunds 60,692 64,771 5,938 54,024 6,815 57,458 1,649 2,027 559 Corporation income taxes 7 Gross receipts 61,780 74,179 25,660 33,522 31,064 40,328 1,936 12,332 3,307 8 Refunds 24,758 17,286 11,467 13,809 8,921 10,045 1,136 441 2,371 9 Social insurance taxes and contributions, net 209,001 241,902 94,277 110,520 100,832 131,372 21,932 18,639 19,107 10 Payroll employment taxes and contributions' 179,010 203,476 85,064 90,912 88,388 106,436 1177,,554477 1166,,778811 1177,,227733 11 Self-employment taxes and contributions2 6,756 8,709 177 6,427 398 7,667 -269 1,209 146 12 Unemployment insurance 18,799 25,138 6.856 10,984 8,714 14,942 4,252 295 1,323 13 Other net receipts3 4,436 4,580 2,180 2,197 2,290 2,329 401 354 365 14 Excise taxes 35,300 37,361 16,555 16,904 19,586 18,304 3,221 3,120 3,264 15 Customs deposits 8,655 11,370 4,299 4,010 5,079 5,576 1,241 939 1,150 16 Estate and gift taxes 6,053 6,010 3,444 2,883 3,050 3,102 558 449 582 17 Miscellaneous receipts4 15,594 16,965 7.890 7,751 7,811 8,481 1,637 1,440 1,586 OUTLAYS 18 All types 795,917 841,800 390,847 396,477 406,849 420,700 88,707 51,234 81,037 19 National defense 210,461 227,405 100,419 105,072 108,967 114,639 20,059 18,942 20,643 20 International affairs 8,927 13,313 4,406 4,705 6,117 5,426 1,020 1,698 1,995 21 General science, space, and technology ... 7,777 8,271 3,903 3,486 4,216 3,981 762 646 961 22 Energy 4,035 2,464 2,058 2,073 1,533 1,080 213 -266 562 23 Natural resources and environment 12,676 12,677 6,941 5,892 6,933 5,463 1,247 1,293 1,390 24 Agriculture 22,173 12,215 13,259 10,154 5,278 7,129 507 145 2,344 25 Commerce and housing credit 4,721 5,198 2,244 2,164 2,648 2,572 -161 103 1,390 26 Transportation 21,231 24,705 10,686 9,918 13,323 10,616 2,272 2,331 2,411 27 Community and regional development .... 7,302 7,803 4,187 3,124 4,327 3,154 698 850 1,106 28 Education, training, employment, social services 25,726 26,616 12,186 12,801 13,246 13,445 2,710 1,839 2,369 29 Health 28,6551 30,435 39,072 41,206 42,150 15,748 2,736 2,337 2,891 30 Social security and medicare 223,311> 235,764 133,779 143,001 34,145 4,084 21,457 31 Income security 106,21 LJ 96,714 135,579 65,212 8,271 7,615 10,493 32 Veterans benefits and services 24,845 25,640 13,240 11,334 13,621 12,849 3,287 936 2,108 33 Administration of justice 5,014 5,616 2,373 2,522 2,628 2,807 553 396 376 34 General government 4,991 4,836 2,323 2,434 2,479 2,462 546 468 536 35 General-purpose fiscal assistance 6,287 6,577 3,153 3,124 3,290 2,943 91 236 1,735 36 Net interest® 89,774 111,007 44,948 42,358 47,674 53,729 11,106 9,742 9,497 37 Undistributed offsetting receipts7 -21,424 -15,454 -8,332 -8,887 -7,262 -7,333 -1,356 -2,160 -3,226 1. Old-age, disability, and hospital insurance, and railroad retirement accounts. function. Before February 1984, these outlays were included in the income 2. Old-age, disability, and hospital insurance. security and health functions. 3. Federal employee retirement contributions and civil service retirement and 6. Net interest function includes interest received by trust funds. disability fund. 7. Consists of rents and royalties on the outer continental shelf and U.S. 4. Deposits of earnings by Federal Reserve Banks and other miscellaneous government contributions for employee retirement. receipts. 5. In accordance with the Social Security Amendments Act of 1983, the SOURCE. "Monthly Treasury Statement of Receipts and Outlays of the U.S. Treasury now provides social security and medicare outlays as a separate Government" and the Budget of the U.S. Government, Fiscal Year 1985. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 Domestic Financial Statistics • January 1985 1.40 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars 1982 1983 1984 IItteemm Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 1 Federal debt outstanding 1,147.0 1,201.9 1,249.3 1,324.3 1,381.9 1,415.3 1,468.3 1,517.2 n.a. 2 Public debt securities 1,142.0 1,197.1 1,244.5 1,319.6 1,377.2 1,410.7 1,463.7 1,512.7 1,572.3 3 Held by public 925.6 987.7 1,043.3 1,090.3 1,138.2 1,174.4 1,223.9 1,255.1 i 4 Held by agencies 216.4 209.4 201.2 229.3 239.0 236.3 239.8 257.6 1 5 Agency securities 5.0 4.8 4.8 4.7 4.7 4.6 4.6 4.5 n.a. 6 Held by public 3.7 3.7 3.7 3.6 3.6 3.5 3.5 3.4 i 7 Held by agencies 1.2 1.2 1.1 1.1 1.1 1.1 1.1 1.1 T 8 Debt subject to statutory limit 1,142.9 1,197.9 1,245.3 1,320.4 1,378.0 1,411.4 1,464.5 1,513.4 1,573.0 9 Public debt securities 1.141.4 1,196.5 1,243.9 1,319.0 1,376.6 1,410.1 1,463.1 1,512.1 1,571.7 10 Other debt1 1.5 1.4 1.4 1.4 1.3 1.3 1.3 1.3 1.3 11 MEMO: Statutory debt limit 1,143.1 1,290.2 1,290.2 1,389.0 1,389.0 1,490.0 1,490.0 1,520.0 1,573.0 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 1983 1984 TTyyppee aanndd hhoollddeerr 11997799 11998800 11998811 11998822 Q4 QL Q2 Q3 1 Total gross public debt 845.1 930.2 1,028.7 1,197.1 1,410.7 1,463.7 1,512.7 1,572.3 By type ? Interest-bearing debt 844.0 928.9 1,027.3 1,195.5 1,400.9 1,452.1 1,501.1 1,559.6 3 Marketable 530.7 623.2 720.3 881.5 1,050.9 1,097.7 1,126.6 1,176.6 4 Bills 172.6 216.1 245.0 311.8 343.8 350.2 343.3 356.8 5 Notes 283.4 321.6 375.3 465.0 573.4 604.9 632.1 661.7 6 Bonds 74.7 85.4 99.9 104.6 133.7 142.6 151.2 158.1 7 Nonmarketable1 313.2 305.7 307.0 314.0 350.0 354.4 374.5 383.0 8 State and local government series 24.6 23.8 23.0 25.7 36.7 38.1 39.9 41.4 9 Foreign issues2 28.8 24.0 19.0 14.7 10.4 9.9 8.8 8.8 10 23.6 17.6 14.9 13.0 10.4 9.9 8.8 8.8 11 Public 5.3 6.4 4.1 1.7 .0 .0 .0 .0 1? Savings bonds and notes 79.9 72.5 68.1 68.0 70.7 71.6 72.3 73.1 13 Government account series3 177.5 185.1 196.7 205.4 231.9 234.6 253.2 259.5 14 Non-interest-bearing debt 1.2 1.3 1.4 1.6 9.8 11.6 11.6 12.7 By holder4 15 U.S. government agencies and trust funds 187.1 192.5 203.3 209.4 236.3 239.8 257.6 16 Federal Reserve Banks 117.5 121.3 131.0 139.3 151.9 150.8 152.9 17 Private investors 540.5 616.4 694.5 848.4 1,022.6 1,073.0 1,093.7 18 Commercial banks 88.1 112.1 111.4 131.4 188.8 189.8 183.8 19 Money market funds 5.6 3.5 21.5 42.6 22.8 19.4 14.9 20 Insurance companies 21.4 24.0 29.0 39.1 48.9 n.a. n.a. n a. 21 Other companies 17.0 19.3 17.9 24.5 39.7 45.4 47.9 22 State and local governments 69.9 84.4 85.6 113.4 n.a. n.a. n.a. Individuals 23 Savings bonds 79.9 72.5 68.1 68.3 71.5 72.2 72.9 74 Other securities 38.1 44.6 42.7 48.2 61.9 64.7 69.3 25 Foreign and international5 119.0 129.7 136.6 149.5 168.9 166.3 170.9 160.1 26 Other miscellaneous investors6 99.6 126.3 167.8 231.4 n.a. n.a. n.a. n.a. 1. Includes (not shown separately): Securities issued to the Rural Electrifica- 5. Consists of investments offoreign and international accounts. Excludes nontion Administration; depository bonds, retirement plan bonds, and individual interest-bearing notes issued to the International Monetary Fund. retirement bonds. 6. Includes savings and loan associations, nonprofit institutions, credit unions, 2. Nonmarketable dollar-denominated and foreign currency-denominated se- mutual savings banks, corporate pension trust funds, dealers and brokers, certain ries held by foreigners. U.S. government deposit accounts, and U.S. government-sponsored agencies. 3. Held almost entirely by U.S. government agencies and trust funds. SOURCES. Data by type of security, U.S. Treasury Department, Monthly 4. Data for Federal Reserve Banks and U.S. government agencies and trust Statement of the Public Debt of the United States; data by holder. Treasury funds are actual holdings; data for other groups are Treasury estimates. Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A33 1.42 U.S. GOVERNMENT SECURITIES DEALERS Transactions Par value; averages of daily figures, in millions of dollars 1984 1984 week ending Wednesday IItteemm 11998811 11998822 11998833 Aug/ Sept/ Oct. Sept. 26r Oct. 3 Oct. 10 Oct. 17 Oct. 24 Oct. 31 Immediate delivery1 1 U.S. government securities 24,728 32,271 42,135 44,640 50,336 60,830 51,008 46,672 48,470 58,456 83,222 44,662 By maturity 2 Bills 14,768 18,398 22,393 21,423 25,701 29,673 24,565 24,712 24,093 31,139 36,241 21,745 3 Other within 1 year 621 810 708 942 1,051 1,721 1,142 1,018 1,298 1,356 2,120 1,402 4 1-5 years 4,360 6,272 8,758 9,470 10,459 13,941 12,749 9,464 10,023 11,216 21,501 11,707 5 5-10 years 2,451 3,557 5,279 6,776 7,977 9,392 7,179 6,522 8,328 9,672 13,543 5,804 6 Over 10 years 2,528 3,234 4,997 6,029 5,148 6,102 5,374 4,956 4,729 5,074 9,817 4,004 By type of customer 7 U.S. government securities dealers 1,640 1,769 2,257 2,669 2,654 3,662 2,397 3,009 3,363 3,474 4,949 2,458 8 U.S. government securities brokers 11,750 15,659 21,045 21,505 24,447 28,670 24,791 22,315 22,112 27,296 39,209 21,455 9 All others2 11,337 15,344 18,833 20,467 23,235 28,498 23,820 21,348 22,995 27,686 39,064 20,749 10 Federal agency securities 3,306 4,142 5,576 7,044 8,967 9,147 8,128 7,208 8,610 10,897 9,968 5,106 11 Certificates of deposit 4,477 5,001 4,334 3,006 4,456 4,934 5,076 3,833 4,668 5,029 5,526 3,897 12 Bankers acceptances 1,807 2,502 2,642 2,533 3,792 4,135 3,829 3,577 4,094 4,754 4,200 2,947 13 Commercial paper 6,128 7,595 8,036 10,528 11,663 10,485 10,853 11,185 11,246 9,692 1100,,113311 77,,221144 Futures transactions3 14 Treasury bills 3,523 5,031 6,655 5,523 5,097 4,909 5,752 3,974 3,215 4,822 5,961 3,955 15 Treasury coupons 1,330 1,490 2,501 4,386 5,134 5,086 4,083 4,073 3,939 4,713 8,126 3,139 16 Federal agency securities 234 259 265 284 254 136 243 123 108 97 161 141 Forward transactions4 17 U.S. government securities 365 835 1,493 1,447 1,074 1,243 1,339 372 727 1,617 2,386 340 18 Federal agency securities 1,370 982 1,646 3,175 2,454 2,626 1,899 2,242 3,101 3,190 2,010 1,565 1. Before 1981, data for immediate transactions include forward transactions. from the date of the transaction for government securities (Treasury bills, notes, 2. Includes, among others, all other dealers and brokers in commodities and and bonds) or after 30 days for mortgage-backed agency issues. securities, nondealer departments of commercial banks, foreign banking agencies, NOTE. Averages for transactions are based on number of trading days in the and the Federal Reserve System. period. 3. Futures contracts are standardized agreements arranged on an organized Transactions are market purchases and sales of U.S. government securities exchange in which parties commit to purchase or sell securities for delivery at a dealers reporting to the Federal Reserve Bank of New York. The figures exclude future date. allotments of, and exchanges for, new U.S. government securities, redemptions 4. Forward transactions are agreements arranged in the over-the-counter of called or matured securities, purchases or sales of securities under repurchase market in which securities are purchased (sold) for delivery after 5 business days agreement, reverse repurchase (resale), or similar contracts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A34 DomesticN onfinancial Statistics • January 1985 1.43 U.S. GOVERNMENT SECURITIES DEALERS Positions and Financing Averages of daily figures, in millions of dollars 1984 1984 week ending Wednesday Aug/ Sept. Oct. Sept. 5 Sept. 12 Sept. 19 Sept. 26 Oct. 3 Positions Net immediate1 1 U.S. government securities 9,033 9,328 6.263 3.372 11.332 14,580 8,365 10,092 10,539 13,281 13,859 2 Bills 6,485 4,837 4.282 4. s S 10,316 11,673 8,322 9,780 11,025 10,052 12,953 3 Other within 1 year -1,526 -199 -177 -89 310 116 173 490 481 80 -36 4 1-5 years 1,488 2,932 1.709 2.471 4,012 5,570 2,622 2,732 2,725 6.956 4,295 5 5-10 years 292 -341 -78 -1.167 -1,031 -1,554 -247 -333 -1,178 -1.764 -1,776 6 Over 10 years 2,294 2,001 528 -2.490 -2.355 -1,348 -2,584 -2,662 -2,592 -2,122 -1,666 7 Federal agency securities 2,277 3.712 7,172 16.098 14,063 13,169 16,627 16,037 14.014 12,247 11,693 8 Certificates of deposit 3.435 5,531 5,839 6.708 7,894 7,620 7,058 7,390 8,343 8,195 7,922 9 Bankers acceptances 1,746 2,832 3,332 4.691 5.274 3,980 5,342 5,487 5,521 4,897 4,782 10 Commercial paper 2,658 3,317 3,159 4.158 4.531 4.683 4,285 4,468 4,872 4,352 4,493 Futures positions 11 Treasury bills -8,934 -2,508 -4,125 -7.176 -9,478 -9,445 -8,605 -9,796 -9,553 -9,631 -8,404 12 Treasury coupons -2,733 -2,361 -1,032 2.802 2,667 2,500 2,942 2,801 2,679 2,741 2,035 13 Federal agency securities 522 -224 170 610 267 -248 407 340 352 159 13 Forward positions 14 U.S. government securities -603 -788 -1,935 -675 -927 -855 -674 -1,203 -714 -925 -759 15 Federal agency securities -451 -1,190 -3,561 -9.682 -8,599 -8,568 -9,741 -9,672 -8,396 -7,769 -8,166 Financing- Reverse repurchase agreements3 16 Overnight and continuing 14,568 26,754 29,099 41.845 42,461 48,558 43,949 41,037 42,976 42,250 43,028 17 Term agreements 32,048 48,247 52,493 71.733 70.864 72,907 70,233 69,986 71,025 72,128 70,447 Repurchase agreements4 18 Overnight and continuing 35,919 49,695 57,946 74.018 81.941 236,944 80.303 82,071 83,544 82,185 79,460 19 Term agreements 29,449 43,410 44,410 53.545 53.799 61,396 50,054 53,281 53,654 55,757 56,182 1. Immediate positions are net amounts (in terms of par values) of securities 2. Figures cover financing involving U.S. government and federal agency owned by nonbank dealer firms and dealer departments of commercial banks on a securities, negotiable CDs. bankers acceptances, and commercial paper. commitment, that is, trade-date basis, including any such securities that have 3. Includes all reverse repurchase agreements, including those that have been been sold under agreements to repurchase (RPs). The maturities of some arranged to make delivery on short sales and those for which the securities repurchase agreements are sufficiently long, however, to suggest that the securi- obtained have been used as collateral on borrowings, that is, matched agreements. ties involved are not available for trading purposes. Prior to 1984, securities 4. Includes both repurchase agreements undertaken to finance positions and owned, and hence dealer positions, do not include all securities acquired under "matched book" repurchase agreements. reverse RPs. After January 1984, immediate positions include reverses to maturi- NOTE. Data for positions are averages of daily figures, in terms of par value, ty, which are securities that were sold after having been obtained under reverse based on the number of trading days in the period. Positions are shown net and are repurchase agreements that mature on the same day as the securities. Before on a commitment basis. Data for financing are based on Wednesday figures, in 1981, data for immediate positions include forward positions. terms of actual money borrowed or lent. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A35 1.44 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt Outstanding Millions of dollars, end of period 1984 AAggeennccyy 11998811 11998822 11998833 Apr. May June July Aug. Sept. 1 Federal and federally sponsored agencies 221,946 237,085 239,716 247,148 252,044 255,376 258,957 251,918 267,399 2 Federal agencies 31,806 33,055 33,940 34,273 34,231 34,473 34,560 34,497 34,754 3 Defense Department' 484 354 243 197 188 181 172 162 162 4 Export-Import Bank2 3 13,339 14,218 14,853 15,344 15,344 15,604 15,611 15,606 15,733 5 Federal Housing Administration4 413 288 194 162 156 155 154 146 146 6 Government National Mortgage Association participation certificates5 2,715 2,165 2,165 2,165 2,165 2,165 2,165 2,165 2,165 7 Postal Service6 1,538 1,471 1,404 1,404 1,337 1,337 1,337 1,337 1,337 8 Tennessee Valley Authority 13,115 14,365 14,970 14,890 14,930 14,980 15,070 15,030 15,160 9 United States Railway Association6 202 194 111 111 111 51 51 51 51 10 Federally sponsored agencies7 190,140 204,030 205,776 212,872 217,813 220,903 224,397 217,421 232,645 11 Federal Home Loan Banks 54,131 55,967 48,930 49,786 52,281 54,799 57,965 62,116 65,616 12 Federal Home Loan Mortgage Corporation 5,480 4,524 6,793 8,134 9,131 8,988 7,822 9,068 8,950 N Federal National Mortgage Association8 58,749 70,052 74,594 78,073 79,267 79,871 80,706 79,921 80,123 14 Farm Credit Banks 71,359 71,896 72,409 73,130 73,138 73,061 73,297 61,628 73,131 15 Student Loan Marketing Association 421 1,591 3,050 3,749 3,996 4,184 4,607 4,688 4,825 MEMO 16 Federal Financing Bank debt 110,698 126,424 135,791 138,769 139,936 141,734 143,322 144,063 144,836 Lending to federal and federally sponsored 17 Export-Import Bank3 12,741 14,177 14,789 15,296 15,296 15,556 15,563 15,563 15,690 18 Postal Service6 1,288 1,221 1,154 1,154 1,087 1,087 1,087 1,087 1,087 19 Student Loan Marketing Association 5,400 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 20 Tennessee Valley Authority 11,390 12,640 13,245 13,165 13,205 13,255 13,345 13,305 13,435 21 United States Railway Association6 202 194 111 111 111 51 51 51 51 Other Lending10 ?.?. Farmers Home Administration 48,821 53,261 55,266 55,691 56,476 57,701 58,856 59,196 59,511 73 Rural Electrification Administration 13,516 17,157 19,766 20,413 20,456 20,611 20,671 20,742 20,587 24 12,740 22,774 26,460 27,939 28,305 28,473 28,749 29,119 29,475 1. Consists of mortgages assumed by the Defense Department between 1957 7. Includes outstanding noncontingent liabilities: Notes, bonds, and debenand 1963 under family housing and homeowners assistance programs. tures. 2. Includes participation certificates reclassified as debt beginning Oct. 1, 1976. 8. Before late 1981, the Association obtained financing through the Federal 3. Off-budget Aug. 17, 1974, through Sept. 30, 1976; on-budget thereafter. Financing Bank. 4. Consists of debentures issued in payment of Federal Housing Administration 9. The FFB, which began operations in 1974, is authorized to purchase or sell insurance claims. Once issued, these securities may be sold privately on the obligations issued, sold, or guaranteed by other federal agencies. Since FFB securities market. incurs debt solely for the purpose of lending to other agencies, its debt is not 5. Certificates of participation issued before fiscal 1969 by the Government included in the main portion of the table in order to avoid double counting. National Mortgage Association acting as trustee for the Farmers Home Adminis- 10. Includes FFB purchases of agency assets and guaranteed loans; the latter tration; Department of Health, Education, and Welfare; Department of Housing contain loans guaranteed by numerous agencies with the guarantees of any and Urban Development; Small Business Administration; and the Veterans particular agency being generally small. The Farmers Home Administration item Administration. consists exclusively of agency assets, while the Rural Electrification Administra- 6. Off-budget. tion entry contains both agency assets and guaranteed loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 DomesticN onfinancial Statistics • January 1985 1.45 NEW SECURITY ISSUES State and Local Governments Millions of dollars 1984 Type of issue or issuer, or use 11998811 11998822 11998833 Feb/ Mar/ Apr/ May' June' July' Aug.' Sept. 1 All issues, new and refunding1 47,732 79,138 86,421 4,599 5,547 5,617 7,075 6,657 7,323 9,803 7,248 Type of issue 2 General obligation 12,394 21,094 21,566 1,846 2,500 2,291 2,373 1,885 1,940 1,864 1,627 3 U.S. government loans2 34 225 96 2 2 3 3 3 3 5 9 4 Revenue 35,338 58,044 64,855 2,753 3,047 3,326 4,702 4,772 5,383 7,939 5,621 5 U.S. government loans2 55 461 253 2 4 8 13 15 18 21 23 Type of issuer 6 State 5,288 8,438 7,140 935 584 886 497 447 457 691 589 7 Special district and statutory authority 27,499 45,060 51,297 2,138 3,069 2,866 3,767 3,9% 5,002 6,913 4,772 8 Municipalities, counties, townships, school districts 14,945 25,640 27,984 1,526 1,894 1,865 2,811 2,214 1,864 2,199 1,887 9 Issues for new capital, total 46,530 74,804 72,441 4,012 4,740 4,485 5,972 6,067 6,433 8,830 7,134 Use of proceeds 10 Education 4,547 6,482 8,099 352 592 475 905 764 493 601 397 11 Transportation 3,447 6,256 4,387 335 56 517 403 658 100 402 576 12 Utilities and conservation 10,037 14,259 13,588 752 1,279 681 1,428 1,172 382 992 2,023 13 Social welfare 12,729 26,635 26,910 1,134 1,100 1,203 1,385 2,120 3,719 4,294 2,802 14 Industrial aid 7,651 8,349 7,821 287 132 358 374 354 859 907 561 15 Other purposes 8,119 12,822 11,637 1,152 1,581 1,251 1,477 999 880 1,634 775 1. Par amounts of long-term issues based on date of sale. SOURCE. Public Securities Association. 2. Consists of tax-exempt issues guaranteed by the Farmers Home Administration. 1.46 NEW SECURITY ISSUES Corporations Millions of dollars 1984 Type of i o s r s u u e s e o r issuer, 11998811 11998822 11998833'' Feb/ Mar/ Apr.' May' June' July' Aug/ Sept. 1 AH issues1-2 70,441 84,638 98,857 7,654 5,442 6,069 4,051 7,268 7,600 10,891 7,729 2 Bonds 45,092 54,076 47,278 5,275 3,346 4,284 2,242 5,047 6,268 8,837 6,1% Type of offering 3 Public 38,103 44,278 47,278 5,275 3,346 4,284 2,242 5,047 6,268 8,837 6,1% 4 Private placement 6,989 9,798 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Industry group 5 Manufacturing 12,325 12,822 7,842 452 68 691 383 1,440 950 2,484 1,594 6 Commercial and miscellaneous 5,229 5,442 5,166 626 258 1,0% 221 531 865 776 576 7 Transportation 2,052 1,491 1,039 75 180 69 0 225 40 183 200 8 Public utility 8,963 12,327 7,241 385 521 495 100 475 650 765 758 9 Communication 4,280 2,390 3,159 0 200 0 0 0 31 0 0 10 Real estate and financial 12,243 19,604 22,829 3,736 2,119 1,932 1,538 2,376 3,731 4,628 3,067 11 Stocks3 25,349 30,562 51,579 2,379 2,096 1,785 1,809 2,221 1,332 2,054 1,533 Type 12 Preferred 1,797 5,113 7,213 425 227 339 579 244 209 334 155 13 Common 23,552 25,449 44,366 1,954 1,869 1,446 1,230 1,977 1,123 1,720 1,378 Industry group 14 Manufacturing 5,074 5,649 14,135 299 387 165 442 584 204 258 212 15 Commercial and miscellaneous 7,557 7,770 13,112 616 486 732 718 316 382 558 378 16 Transportation 779 709 2,729 15 105 62 84 1 28 0 87 17 Public utility 5,577 7,517 5,001 45 134 188 116 282 136 44 92 18 Communication 1,778 2,227 1,822 20 18 94 16 11 0 123 9 19 Real estate and financial 4,584 6,690 14,780 1,384 966 544 433 1,027 582 1,071 755 1. Figures, which represent gross proceeds of issues maturing in more than one 2. Data for 1983 include only public offerings. year, sold for cash in the United States, are principal amount or number of units 3. Beginning in August 1981, gross stock offerings include new equity volume multiplied by offering price. Excludes offerings of less than $100,000, secondary from swaps of debt for equity. offerings, undefined or exempted issues as defined in the Securities Act of 1933, SOURCE. Securities and Exchange Commission and the Board of Governors of employee stock plans, investment companies other than closed-end, intracorpo- the Federal Reserve System. rate transactions, and sales to foreigners. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Market and Corporate Finance A37 1.47 OPEN-END INVESTMENT COMPANIES Net Sales and Asset Position Millions of dollars 1984 IItteemm 11998822 11998833 Feb. Mar. Apr. May June July Aug/ Sept. INVESTMENT COMPANIES' 1 Sales of own shares2 45,675 84,793 8,233 8,857 9,549 8,657 8,397 7,550 9,018 7,092 2 Redemptions of own shares3 30,078 57,120 5,162 5,339 7,451 5,993 6,156 5.777 6,497 6,185 3 Net sales 15,597 27,673 3,071 3,518 2.098 2,664 2,241 1,773 2,521 907 4 Assets4 76,841 113,599 111,068 114,537 116,812 111,071 115,034 115,481 128,209 128,562 5 Cash position5 6,040 8,343 9,140 10,406 10,941 10,847 11,907 11,620 12,698 12,098 6 Other 70,801 105,256 101,928 104,131 105,871 100,224 103,127 103,861 115,511 116,464 1. Excluding money market funds. 5. Also includes all U.S. government securities and other short-term debt 2. Includes reinvestment of investment income dividends. Excludes reinvest- securities. ment of capital gains distributions and share issue of conversions from one fund to another in the same group. NOTE. Investment Company Institute data based on reports of members, which 3. Excludes share redemption resulting from conversions from one fund to comprise substantially all open-end investment companies registered with the another in the same group. Securities and Exchange Commission. Data reflect newly formed companies after 4. Market value at end of period, less current liabilities. their initial offering of securities. 1.48 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1982 1983 1984 AAccccoouunntt 11998811 11998822 11998833 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 1 Corporate profits with inventory valuation and capital consumption adjustment 189.9 159.1 225.2 151.6 179.1 216.7 245.0 260.0 277.4 291.1 281.5 2 Profits before tax 221.1 165.5 203.2 155.8 161.7 198.2 227.4 225.5 243.3 246.0 223.7 3 Profits tax liability 81.1 60.7 75.8 55.0 59.1 74.8 84.7 84.5 92.7 95.8 84.4 4 Profits after tax 140.0 104.8 127.4 100.8 102.6 123.4 142.6 141.1 150.6 150.2 139.3 5 Dividends 66.5 69.2 72.9 70.2 71.1 71.7 73.3 75.4 77.7 79.9 81.3 6 Undistributed profits 73.5 35.6 54.5 30.6 31.4 51.7 69.3 65.6 72.9 70.2 58.0 7 Inventory valuation -23.6 -9.5 -11.2 -12.6 -4.3 -12.1 -19.3 -9.2 -13.5 -7.3 -.4 8 Capital consumption adjustment -7.6 3.1 33.2 8.4 21.7 30.6 36.9 43.6 47.6 52.3 58.2 SOURCE. Survey of Current Business (Department of Commerce). 1.49 NONFINANCIAL CORPORATIONS Assets and Liabilities Billions of dollars, except for ratio 1983 1984 AAccccoouunntt 11997788 11997799 11998800 11998811 11998822 Q2 Q3 Q4 QL Q2 1 Current assets 1,043.7 1,214.8 1,327.0 1,418.4 1,432.7 1,468.0 1,522.8 1,557.3 1,600.6 1,630.8 2 Cash 105.5 118.0 126.9 135.5 147.0 147.9 150.5 165.8 159.3 155.5 3 U.S. government securities 17.2 16.7 18.7 17.6 22.8 28.2 27.0 30.6 35.1 36.8 4 Notes and accounts receivable 388.0 459.0 506.8 532.0 519.2 539.3 565.0 577.8 596.9 612.6 5 Inventories 431.8 505.1 542.8 583.7 578.6 576.2 597.3 599.3 623.1 633.3 6 Other 101.1 116.0 131.8 149.5 165.2 176.4 183.0 183.7 186.3 192.5 7 Current liabilities 669.5 807.3 889.3 970.0 976.8 990.2 1,026.6 1,043.0 1,079.0 1,111.5 8 Notes and accounts payable 383.0 460.8 513.6 546.3 543.0 536.6 559.4 577.9 584.1 606.0 9 Other 286.5 346.5 375.7 423.7 433.8 453.6 467.2 465.2 495.0 505.5 10 Net working capital 374.3 407.5 437.8 448.4 455.9 477.8 496.3 514.3 521.6 519.3 11 MEMO: Current ratio1 1.559 1.505 1.492 1.462 1.467 1.483 1.483 1.493 1.483 1.467 1. Ratio of total current assets to total current liabilities. Statistics, Board of Governors of the Federal Reserve System, Washington, D.C. NOTE. For a description of this series, see "Working Capital of Nonfinancial 20551. Corporations" in the July 1978 BULLETIN, pp. 533-37. SOURCE. Federal Trade Commission and Bureau of the Census. 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 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A38 Domestic Nonfinancial Statistics • January 1985 1.50 TOTAL NONFARM BUSINESS EXPENDITURES on New Plant and Equipment A Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1983 1984 IInndduussttrryy11 11998822 11998833 11998844'' Q2 Ql Q3 Q4 Ql Q2 Q31 Q41 1 Total nonfarm business 282.71 269.22 307.60 261.71 261.16 270.05 283.96 293.15 302.70 316.22 318.33 Manufacturing 2 Durable goods industries 56.44 51.78 62.73 50.74 48.48 53.06 5544..8855 58.94 60.20 64.82 66.98 3 Nondurable goods industries 63.23 59.75 67.66 59.12 60.31 58.06 61.50 63.84 67.46 69.64 69.69 Nonmanufacturing 4 Mining 15.45 11.83 13.11 12.03 10.91 11.93 12.43 13.95 12.13 13.24 13.14 Transportation 5 Railroad 4.38 3.92 5.19 3.35 3.64 4.07 4.63 4.41 5.64 5.31 5.41 6 Air 3.93 3.77 2.91 4.09 4.10 3.57 3.32 2.77 2.98 3.19 2.70 7 Other 3.64 3.50 4.36 3.60 3.14 3.36 3.91 4.28 4.33 4.36 4.47 Public utilities 8 Electric 33.40 34.99 34.78 33.97 34.86 35.84 35.31 35.74 35.30 34.20 33.88 9 Gas and other 8.55 7.00 9.55 7.64 6.62 6.38 7.37 7.87 9.30 9.86 11.15 10 Commercial and other2 93.68 92.67 107.30 87.17 89.10 93.79 100.62 101.35 105.35 111.60 110.92 ATrade and services are no longer being reported separately. They are included 2. "Other'' consists of construction; wholesale and retail trade; finance and in Commercial and other, line 10. insurance; personal and business services; and communication. 1. Anticipated by business. SOURCE. Survey of Current Business (Department of Commerce). 1.51 DOMESTIC FINANCE COMPANIES Assets and Liabilities Billions of dollars, end of period 1983 1984 AAccccoouunntt 11997788 11997799 11998800 11998811 11998822 Q3 Q4 Ql Q2 Q3 ASSETS Accounts receivable, gross 1 Consumer 52.6 65.7 73.6 85.5 89.5 92.3 92.8 96.9 99.6 103.4 ? Business 63.3 70.3 72.3 80.6 81.0 86.8 95.2 101.1 104.2 103.2 3 Total 116.0 136.0 145.9 166.1 170.4 179.0 188.0 198.0 203.8 206.6 4 LESS; Reserves for unearned income and losses.... 15.6 20.0 23.3 28.9 30.5 30.1 30.6 31.9 33.4 34.7 5 Accounts receivable, net 100.4 116.0 122.6 137.2 139.8 148.9 157.4 166.1 170.4 171.9 6 Cash and bank deposits 3.5 "1 7 Securities 1.3 \ 24.9' 27.5 34.2 39.7 45.0 45.3 47.1 48.1 49.1 8 All other 17.3 J 9 Total assets 122.4 140.9 150.1 171.4 179.5 193.9 202.7 213.2 218.5 220.9 LIABILITIES 10 Bank loans 6.5 8.5 13.2 15.4 18.6 17.0 19.1 14.7 15.3 16.0 11 Commercial paper 34.5 43.3 43.4 51.2 45.8 49.7 53.6 58.4 62.0 60.1 Debt 1? Short-term, n.e.c 8.1 8.2 7.5 9.6 8.7 8.7 11.3 12.2 15.0 15.1 13 Long-term, n.e.c 43.6 46.7 52.4 54.8 63.5 66.2 65.4 68.7 67.6 71.2 14 Other 12.6 14.2 14.3 17.8 18.7 24.4 27.1 29.8 29.0 29.2 15 Capital, surplus, and undivided profits 17.2 19.9 19.4 22.8 24.2 27.9 26.2 29.4 29.6 29.2 16 Total liabilities and capital 122.4 140.9 150.1 171.4 179.5 193.9 202.7 213.2 218.5 220.9 1. Beginning Q1 1979, asset items on lines 6, 7, and 8 are combined. These data also appear in the Board's G.20 (422) release. For address, see NOTE. Components may not add to totals due to rounding. inside front cover. 1.52 DOMESTIC FINANCE COMPANIES Business Credit Millions of dollars, seasonally adjusted except as noted Changes in accounts Extensions Repayments receivable AAAccccccooouuunnntttsss rrreeeccceeeiiivvvaaabbbllleee TTTyyypppeee ooouuutttssstttaaannndddiiinnnggg 1984 1984 1984 SSSeeepppttt... 333000,,, 111999888444''' July Aug. Sept. July Aug. Sept. July Aug. Sept. 1 Total 103,210 544 3,032 -203 25,961 30,274 22,676 25,417 27,242 22,879 2 Retail automotive (commercial vehicles) 26,038 452 489 21 2,108 2,232 1,840 1,656 1,743 1,819 3 Wholesale automotive 13,525 -287 2,533 -1,429 8,042 10,803 6,050 8,329 8,270 7,479 4 Retail paper on business, industrial, and farm equipment 30,926 -34 7 554 1,143 1,589 1,493 1,177 1,582 939 5 Loans on commercial accounts receivable and factored commercial accounts receivable 11,133 197 107 124 12,036 13,168 10,815 11,839 13,061 10,691 6 All other business credit 21,588 216 -104 527 2,632 2,482 2,478 2,416 2,586 1,951 1. Not seasonally adjusted. NOTE. These data also appear in the Board's G.20 (422) release. For address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Real Estate A39 1.53 MORTGAGE MARKETS Millions of dollars; exceptions noted. 1984 IItteemm 11998811 11998822 11998833 Apr. May June July Aug. Sept. Oct. Terms and yields in primary and secondary markets PRIMARY MARKETS Conventional mortgages on new homes Terms1 1 Purchase price (thousands of dollars) 90.4 94.6 92.8 92.4 93.9 93.4 98.3 94.3 97.4 ' 98.6 2 Amount of loan (thousands of dollars) 65.3 69.8 69.6 71.1 72.8 72.5 74.6 71.8 72.5 ' 74.1 3 Loan/price ratio (percent) 74.8 76.6 77.1 79.2 79.8 79.9 78.4 78.1 77.3 ' 78.1 4 Maturity (years) 27.7 27.6 26.7 28.0 27.6 28.1 28.2 28.0 27.6 27.5 5 Fees and charges (percent of loan amount)2 2.67 2.95 2.40 2.63 2.63 2.58 3.07 2.82 2.63' 2.55 6 Contract rate (percent per annum) 14.16 14.47 12.20 11.55 11.68 11.61 11.91 11.89 12.03 12.29 Yield (percent per annum) 7 FHLBB series5 14.74 15.12 12.66 12.04 12.18 12.10 12.50 12.43 12.53' 12.77 8 HUD series4 16.52 15.79 13.43 13.77 14.38 14.65 14.53 14.24 13.98 13.59 SECONDARY MARKETS Yield (percent per annum) 9 FHA mortgages (HUD series)5 16.31 15.31 13.11 13.80 15.01 14.91 14.58 14.21 13.99 13.43 10 GNMA securities6 15.29 14.68 12.25' 13.03' 13.67 14.14 13.88' 13.56' 13.36' 13.09 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 11 Total 58,675 66,031 74,847 81,956 82,697 83,243 83,858 84,193 84,851 85,539 12 FHA/VA-insured 39,341 39,718 37,393 35,438 35,309 35,153 35,049 34,938 34,844 34,791 13 Conventional 19,334 26,312 37,454 46,518 47,388 48,090 48,809 49,255 50,006 50,749 Mortgage transactions (during period) 14 Purchases 6,112 15,116 17,554 1,775 1,379 1,209 1,226 820 1,145 1,087 15 Sales 2 2 3,528 235 0 0 0 0 0 0 Mortgage commitments1 16 Contracted (during period) 9,331 22,105 18,607 1,561 1,233 1,995 1,976 1,227 1,142 1,638 17 Outstanding (end of period) 3,717 7,606 5,461 5,135 4,981 5,640 6,281 6,332 6,235 6,656 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period)s 18 Total 5,231 5,131 5,9% 9,143 9,224 9,478 9.154 9,331 19 FHA/VA 1,065 1,027 974 924 918 912 906 901 20 Conventional 4,166 4,102 5,022 8,219 8,306 8,566 8,248 8,431 Mortgage transactions (during period) 21 Purchases 3,800 23,673 23,089 983 987 2,204 1,288 1,821 n a. n a. 22 Sales 3,531 24,170 19,686 717 829 1,854 1,573 1,570 Mortgage commitments9 23 Contracted (during period) 6,896 28,179 32,852 1,701 1,966 2,712 3,929 3,130 24 Outstanding (end of period) 3,518 7,549 16,964 18,183 19,139 19,649 22,311 23,639 1. Weighted averages based on sample surveys of mortgages originated by 6. Average net yields to investors on Government National Mortgage Associamajor institutional lender groups; compiled by the Federal Home Loan Bank tion guaranteed, mortgage-backed, fully modified pass-through securities, assum- Board in cooperation with the Federal Deposit Insurance Corporation. ing prepayment in 12 years on pools of 30-year FHA/VA mortgages carrying the 2. Includes all fees, commissions, discounts, and "points" paid (by the prevailing ceiling rate. Monthly figures are unweighted averages of Monday borrower or the seller) to obtain a loan. quotations for the month. 3. Average effective interest rates on loans closed, assuming prepayment at the 7. Includes some multifamily and nonprofit hospital loan commitments in end of 10 years. addition to 1- to 4-family loan commitments accepted in FNMA's free market 4. Average contract rates on new commitments for conventional first mort- auction system, and through the FNMA-GNMA tandem plans. gages; from Department of Housing and Urban Development. 8. Includes participation as well as whole loans. 5. Average gross yields on 30-year, minimum-downpayment, Federal Housing 9. Includes conventional and government-underwritten loans. FHLMC's mort- Administration-insured first mortgages for immediate delivery in the private gage commitments and mortgage transactions include activity under mortgage/ secondary market. Any gaps in data are due to periods of adjustment to changes in securities swap programs, while the corresponding data for FNMA exclude swap maximum permissible contract rates. activity. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A40 Domestic Nonfinancial Statistics • January 1985 1.54 MORTGAGE DEBT OUTSTANDING Millions of dollars, end of period 1983 1984 TTyyppee ooff hhoollddeerr,, aanndd ttyyppee ooff pprrooppeerrttyy 11998811 11998822 11998833 Q3 Q4 Ql Q2 Q3 1 All holders 1,583,264 1,655,036 1,826,395 1,775,116'' 1,826,395 1,869,442 1,926,578' 1,982,755 2 1- to 4-family 1,065,294 1.105,717 1,214,592 1,182,071' 1,214,592 1,244,157 1,278,575' 1,314,410 3 Multifamily 136,354 140.551 150,949 147,052 150,949 154,338 158,835' 163,043 4 Commercial 279,889 302.055 351,287 336,981' 351,287 360,888 378,218' 393,691 5 Farm 101,727 106,713 109,567 109,012 109,567 110,059 110,950' 111,611 6 Major financial institutions 1,040,827 1,023.611 1,109,963 1,079,604' 1,109,963 1,136,168 1,179,553' 1,219,730 7 Commercial banks1 284,536 300,203 328,878 320,299 328,878 338,877 351,459' 364,540 8 1- to 4-familv 170,013 173.157 181,672 178,054 181,672 184,925 189,718' 195,029 9 Multifamily 15,132 16,421 18,023 17,424 18,023 19,689 20,455' 21,326 10 Commercial 91,026 102.219 119,843 115,692 119,843 124,571 131,235' 137,796 11 Farm 8,365 8.406 9,340 9,129 9,340 9,692 10,051' 10,389 12 Mutual savings banks 99,997 97,805 136,054 129,644' 136,054 143,180 147,517' 155,115 13 1- to 4-family 68,187 66.777 96,569 92,182' 96,569 101,868 105,063' 110,528 14 Multifamily 15,960 15.305 17,785 17,588 17,785 18,441 18,752' 19,566 15 Commercial 15,810 15,694 21,671 19,846' 21,671 22,841 23,672' 24,990 16 Farm 40 29 29 28 29 30 30 31 17 Savings and loan associations 518,547 483,614 493,432 482,305 493,432 502,143 526,732' 544,280 18 1- to 4-family 433,142 393.323 389,811 381,744 389,811 395,940 412,958' 424,539 19 Multifamily 37,699 38.979 42,435 41,334 42,435 43,435 45,299' 46,808 20 Commercial 47,706 51.312 61,186 59,227 61,186 62,768 68,475' 72,933 21 Life insurance companies 137,747 141.989 151,599 147,356 151,599 151,968 153,845' 155,795 22 1- to 4-family 17.201 16,751 15.385 15,534 15,385 14,971 14,437' 14,496 23 Multifamily 19,283 18,856 19,189 18,857 19,189 19,153 19,028' 19,152 24 Commercial 88,163 93.547 104,279 100,209 104,279 105,270 107,796' 109,597 25 Farm 13,100 12.835 12,746 12,756 12,746 12,574 12,584' 12,550 26 Federal and related agencies 126,094 138.138 147,370 142,224 147,370 150,784 152,669' 153,491 27 Government National Mortgage Association 4,765 4.227 3,395 3,475 3,395 2,900 2,715 2,465 28 1- to 4-family 693 676 630 639 630 618 605 549 29 Multifamily 4,072 3,551 2,765 2,836 2,765 2,282 2,110 1,916 30 Farmers Home Administration 2,235 1.786 2,141 600 2,141 2,094 1,344 738 31 1- to 4-family 914 783 1,159 211 1,159 1,005 281 206 32 Multifamily 473 218 173 32 173 303 463 126 33 Commercial 506 377 409 113 409 319 81 113 34 Farm 342 408 400 244 400 467 519 293 35 Federal Housing and Veterans Administration 5,999 5,228 4,894 5,050 4,894 4,832 4,753' 4,750 36 1- to 4-family 2,289 1.980 1,893 2,061 1,893 1,956 1,894' 1,916 37 Multifamily 3,710 3.248 3,001 2,989 3,001 2,876 2,859' 2,834 38 Federal National Mortgage Association 61,412 71,814 78,256 75,174 78,256 80,975 83,243 84,850 39 1- to 4-family 55,986 66.500 73,045 69,938 73,045 75,770 77,633 79,175 40 Multifamily 5,426 5,314 5.211 5,236 5,211 5,205 5,610 5,675 41 Federal Land Banks 46,446 50,350 51,052 51,069 51,052 51,004 51,136 51,182 42 1- to 4-family 2,788 3.068 3,000 3,008 3,000 2,982 2,958 2,954 43 Farm 43,658 47.282 48,052 48,061 48,052 48,022 48,178 48,228 44 Federal Home Loan Mortgage Corporation 5,237 4.733 7,632 6,856 7,632 8,979 9,478 9,506 45 1- to 4-family 5,181 4,686 7,559 6,799 7,559 8,847 8,931 8,897 46 Multifamily 56 47 73 57 73 132 547 609 47 Mortgage pools or trusts2 163,000 216,654 285,073 272,611 285,073 296,481 305,051 317,585 48 Government National Mortgage Association 105,790 118,940 159,850 151,597 159,850 166,261 170,893 175,525 49 1- to 4-family 103,007 115,831 155,801 147,761 155,801 161,943 166,415 170,850 50 Multifamily 2,783 3,109 4,049 3,836 4,049 4,318 4,478 4,675 51 Federal Home Loan Mortgage Corporation 19,853 42,964 57,895 54,152 57,895 59,376 61,267 64,246 52 1- to 4-family 19,501 42,560 57,273 53,539 57,273 58,776 60,636 63,621 53 Multifamily 352 404 622 613 622 600 631 625 54 Federal National Mortgage Association3 717 14,450 25,121 23,819 25,121 28,354 29,256 32,888 55 1- to 4-family 717 14.450 25,121 23,819 25,121 28,354 29,256 32,730 56 Multifamily n.a. n.a. n.a. n.a. n.a. n.a. n.a. 158 57 Farmers Home Administration 36,640 40.300 42,207 43,043 42,207 42,490 43,635 44,926 58 1- to 4-family 18,378 20.005 20,404 21,083 20,404 20,573 21,331 21,595 59 Multifamily 3,426 4,344 5,090 5,042 5,090 5,081 5,081 5,618 60 Commercial 6.161 7,011 7,351 7,542 7,351 7,456 7,764 7,844 61 Farm 8.675 8.940 9,362 9,376 9,362 9,380 9,459 9,869 62 Individual and others4 253,343 276,633 283,989 280,677 283,989 286,009 289,305' 291,949 63 1- to 4-family5 167,297 185,170 185,270 185,699 185,270 185,629 186,459' 187,325 64 Multifamily 27,982 30.755 32,533 31,208 32,533 32,823 33,522' 33,955 65 Commercial 30,517 31.895 36,548 34,352 36,548 37,663 39,195' 40,418 66 Farm 27,547 28,813 29,638 29,418 29,638 29,894 30,129' 30,251 1. Includes loans held by nondeposit trust companies but not bank trust 5. Includes estimate of residential mortgage credit provided by individuals. departments. NOTE. Based on data from various institutional and governmental sources, with 2. Outstanding principal balances of mortgages backing securities insured or some quarters estimated in part by the Federal Reserve in conjunction with the guaranteed by the agency indicated. Federal Home Loan Bank Board and the Department of Commerce. Separation of 3. Outstanding balances on FNMA's issues of securities backed by pools of nonfarm mortgage debt by type of property, if not reported directly, and conventional mortgages held in trust. Implemented by FNMA in October 1981. interpolations and extrapolations when required, are estimated mainly by the 4. Other holders include mortgage companies, real estate investment trusts, Federal Reserve. Multifamily debt refers to loans on structures of five or more state and local credit agencies, state and local retirement funds, noninsured units. pension funds, credit unions, and U.S. agencies for which amounts are small or for which separate data are not readily available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Consumer Installment Credit A41 1.55 CONSUMER INSTALLMENT CREDIT' Total Outstanding, and Net ChangeA Millions of dollars 1984 HHoollddeerr,, aanndd ttyyppee ooff ccrreeddiitt 11998811 Feb. Mar. Apr. May June July Aug. Sept. Amounts outstanding (end of period) 1 Total 335,691 355,849 396,082 399,177 402,466 407,671 418,080 427,565 435,367 443,537 450,131 By major holder 2 Commercial banks 147,622 152,490 171,978 175,941 177,625 181,022 186,668 191,519 195,265 199,654 202,452 3 Finance companies 89,818 98,693 102,862 101,702 101,619 101,119 102,967 104,460 106,219 106,881 108,437 4 Credit unions 45,953 47,253 53,471 54,851 55,892 56,962 58,517 59,893 61,151 62,679 63,808 5 Retailers2 31,348 32,735 35,911 33,455 33,208 33,327 33,730 34,206 34,022 34,294 34,426 6 Savings and loans 12,410 15,823 21,615 22,269 23,071 23,957 24,915 25,837 26,767 27,918 28,868 7 Gasoline companies 4,403 4,063 4,131 4,025 3,944 3,955 4,020 4,289 4,472 4,452 4,328 8 Mutual savings banks 4,137 4,792 6,114 6,934 7,107 7,329 7,263 7,361 7,471 7,659 7,812 By major type of credit 9 Automobile 125,331 131,086 142,449 146,047 146,047 147,944 152,225 155,937 159,649 162,038 164,361 10 Commercial banks 58,081 59,555 67,557 71,327 71,237 73,016 75,787 78,018 80,103 81,786 82,706 11 Indirect paper 34,375 34,755 (3) (3) (3) (3) (3) (3) (3) (3) (3) 12 Direct loans 23,706 23,472 (3) (3) (3) (3) (3) (3) (3) (3) (3) 13 Credit unions 21,974 22,596 25,574 26,234 26,732 27,244 27,988 28,646 29,248 29,979 30,519 14 Finance companies 45,275 48,935 49,318 48,486 48,078 47,684 48,450 49,273 50,298 50,273 51,136 15 Revolving 64,500 69,998 80,823 77,671 79,110 80,184 82,436 84,598 85,588 87,788 89,742 16 Commercial banks 32,880 36,666 44,184 43,506 45,235 46,149 47,936 49,374 50,358 52,313 54,258 17 Retailers 27,217 29,269 32,508 30,140 29,931 30,080 30,480 30,935 30,758 31,023 31,156 18 Gasoline companies 4,403 4,063 4,131 4,025 3,944 3,955 4,020 4,289 4,472 4,452 4,328 19 Mobile home 17,958 22,254 23,680 23,571 23,661 23,850 24,104 24,427 24,751 25,178 25,482 ?0 Commercial banks 10,187 9,605 9,842 9,663 9,589 9,580 9,573 9,621 9,681 9,711 9,761 21 Finance companies 4,494 9,003 9,365 9,324 9,333 9,361 9,434 9,528 9,612 9,786 9,857 22 Savings and loans 2,788 3,143 3,906 4,003 4,147 4,306 4,478 4,644 4,811 5,018 5,189 23 Credit unions 489 503 567 581 592 603 619 634 647 663 675 24 Other 127,903 132,511 149,130 151,888 153,648 155,693 159,315 162,603 165,379 168,533 170,546 25 Commercial banks 46,474 46,664 50,395 51,445 51,564 52,277 53,372 54,506 55,123 55,844 55,727 26 Finance companies 40,049 40,755 44,179 43,892 44,208 44,074 45,083 45,659 46,309 46,822 47,444 27 Credit unions 23,490 24,154 27,330 28,036 28,568 29,115 29,910 30,613 31,256 32,037 32,614 28 Retailers 4,131 3,466 3,403 3,315 3,277 3,247 3,250 3,271 3,264 3,271 3,270 29 Savings and loans 9,622 12,680 17,709 18,266 18,924 19,651 20,437 21,193 21,956 22,900 23,679 30 Mutual savings banks 4,137 4,792 6,114 6,934 7,107 7,329 7,263 7,361 7,471 7,659 7,812 Net change (during period)4 31 Total 18,217 17,886 40,233 6,608 5,870 6,408 10,233 7,825 7,106 5,998 4,283 By major holder 32 Commercial banks 607 4,442 19,488 4,914 3,422 4,015 66,,006655 3,835 33,,119922 22,,663311 11,,338844 33 Finance companies 13,062 4,504 4,169 258 -193 -350 1,304 1,353 1,402 1,111 1,204 34 Credit unions 1,913 1,298 6,218 712 1,230 1,529 1,453 962 1,566 844 686 35 Retailers2 1,103 651 3,176 325 355 278 476 471 -101 206 132 36 Savings and loans 1,682 2,290 5,792 414 813 868 979 1,069 847 1,124 769 37 Gasoline companies -65 -340 68 -172 2 2 46 89 -40 -51 -135 38 Mutual savings banks -85 251 1,322 156 242 66 -90 46 240 133 243 By major type of credit 39 Automobile 8,495 4,898 11,363 2,799 326 2,158 33,,668899 22,,889977 33,,442222 11,,777777 11,,331177 4 4 1 0 Co I m nd m ir e e r c c t i a p l a b p a e n r ks -3 - , 8 4 5 5 8 5 2 - 2 9 5 1,72 ( 2 3 ) 2,63 ( 5 3 ) 43 ( 2 3 ) 1,7 ( 66 3 ) 2,80 ( 7 3 ) 1,90 ( 7 3 ) 1,85 ( 2 3 ) 1,1 ( 50 3 ) 43 ( 4 3 ) 4? Direct loans -2,597 -234 (3) (3) (3) (3) (3) (3) (3) (3) (3) 43 Credit unions 914 622 2,978 276 660 734 695 461 750 405 327 44 Finance companies 11,033 3,505 329 -112 -766 -342 187 529 820 222 556 45 Revolving 4,467 4,365 10,825 1,273 2,962 1,868 2,817 1,569 640 1,314 1,324 46 Commercial banks 3,115 3,808 7,518 1,127 2,613 1,568 2,298 1,047 764 1,159 1,323 47 Retailers 1,417 897 3,239 318 347 298 473 433 -84 206 136 48 Gasoline companies -65 -340 68 -172 2 2 46 89 -40 -51 -135 49 Mobile home 1,049 609 1,426 -127 285 285 302 454 462 573 318 50 Commercial banks -186 -508 237 -112 -85 27 -50 10 31 4 4 51 Finance companies 749 471 430 -93 218 110 156 258 185 346 150 52 Savings and loans 466 633 763 68 141 132 183 174 230 214 157 53 Credit unions 20 14 64 10 10 16 13 12 16 9 7 54 Other 4,206 3,224 16,619 2,662 2,298 2,097 3,425 2,905 2,582 2,334 1,324 55 Commercial banks 1,133 372 3,731 1,264 463 653 1,010 871 545 318 -377 56 Finance companies 1,280 528 3,424 463 355 -118 961 566 397 543 498 57 Credit unions 975 662 3,176 426 558 780 745 489 800 430 352 58 Retailers -314 -246 -63 7 8 -20 3 38 -17 0 -4 59 Savings and loans 1,217 1,657 5,029 346 673 735 796 895 617 910 612 60 Mutual savings banks -85 251 1,322 156 242 66 -90 46 240 133 243 • These data have been revised from July 1979 through February 1984. 4. For 1982 and earlier, net change equals extensions, seasonally adjusted less 1. The Board's series cover most short- and intermediate-term credit extended liquidations, seasonally adjusted. Beginning 1983, net change equals outstandings, to individuals through regular business channels, usually to finance the purchase seasonally adjusted less outstandings of the previous period, seasonally adjusted. of consumer goods and services or to refinance debts incurred for such purposes, NOTE. Total consumer noninstallment credit outstanding—credit scheduled to and scheduled to be repaid (or with the option of repayment) in two or more be repaid in a lump sum, including single-payment loans, charge accounts, and installments. service credit—amounted to, not seasonally adjusted, $80.7 billion at the end of 2. Includes auto dealers and excludes 30-day charge credit held by travel and 1981, $85.9 billion at the end of 1982, and $96.9 billion at the end of 1983. entertainment companies. These data also appear in the Board's G.19 (421) release. For address, see 3. Not reported after December 1982. inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A42 DomesticN onfinancial Statistics • January 1985 1.56 TERMS OF CONSUMER INSTALLMENT CREDIT Percent unless noted otherwise 1984 1981 May June July Aug. Sept Oct. INTEREST RATES Commercial banks' 1 48-month new car2 16.54 16.83 13.92 13.53 14.08 13.91 2 24-month personal 18.09 18.65 16.68 16.35 16.75 16.65 3 120-month mobile home2 17.45 18.05 15.91 15.54 15.72 15.60 4 Credit card 17.78 18.51 18.73 18.71 18.81 18.83 Auto finance companies 5 New car 16.17 16.15 12.58 14.17 14.33 14.68 15.01 15.16 15.18 6 Used car 20.00 20.75 18.74 17.60 17.64 17.77 17.99 18.10 18.19 OTHER TERMS3 Maturity (months) 7 New car 45.4 46.0 45.9 47.7 48.2 48.6 49.2 49.5 49.7 8 Used car 35.8 34.0 37.9 39.7 39.8 39.8 39.8 39.9 39.9 Loan-to-value ratio 9 New car 86.1 85.3 86.0 10 Used car 91.8 90.3 92.0 92 Amount financed (dollars) 11 New car 7,339 8,178 8,787 9,262 9,311 9,377 9,409 9,402 9,449 12 Used car 4,343 4,746 5,033 5,675 5,774 5,763 5,753 5,792 5,826 1. Data for midmonth of quarter only. NOTE. These data also appear in the Board's G.19 (421) release. For address, 2. Before 1983 the maturity for new car loans was 36 months, and for mobile see inside front cover. home loans was 84 months. 3. At auto finance companies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A43 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; half-yearly data are at seasonally adjusted annual rates. 1981 1982 1983 1984 TTrraannssaaccttiioonn ccaatteeggoorryy,, sseeccttoorr 11997788 11997799 11998800 11998811 11998822 11998833 H2 HI H2 HI H2 HI' Nonfinancial sectors 1 Total net borrowing by domestic nonfinancial sectors .... 369.8 386.0 344.6 380.4 404.1 526.4 368.0 358.1 450.1 448.9 563.8 688.2 By sector and instrument 2 U.S. government 53.7 37.4 79.2 87.4 161.3 186.6 88.1 104.1 218.4 222.0 151.1 172.8 3 Treasury securities 55.1 38.8 79.8 87.8 162.1 186.7 88.5 105.5 218.8 222.1 151.2 173.1 4 Agency issues and mortgages -1.4 -1.4 -.6 -.5 -.9 -.1 -.4 -1.4 -.4 -.1 -.1 -.2 5 Private domestic nonfinancial sectors 316.2 348.6 265.4 293.1 242.8 339.8 279.9 254.0 231.7 266.9 412.7 515.4 6 Debt capital instruments 199.7 211.2 192.0 159.1 158.9 239.3 140.3 140.7 177.2 214.4 264.2 268.5 7 Tax-exempt obligations 28.4 30.3 30.3 22.7 53.8 56.3 24.7 43.9 63.7 62.8 49.7 38.1 8 Corporate bonds 21.1 17.3 26.7 21.8 18.7 15.7 16.8 12.0 25.3 23.0 8.4 24.0 9 Mortgages 150.2 163.6 135.1 114.6 86.5 167.3 98.8 84.8 88.2 128.6 206.0 206.4 10 Home mortgages 112.2 120.0 96.7 76.0 52.5 108.7 62.3 53.6 51.3 83.8 133.6 132.5 11 Multifamily residential 9.2 7.8 8.8 4.3 5.5 8.4 3.8 5.1 5.8 2.8 13.9 16.6 12 Commercial 21.7 23.9 20.2 24.6 23.6 47.3 22.9 19.7 27.5 40.3 54.3 55.3 13 Farm 7.2 11.8 9.3 9.7 5.0 2.9 9.8 6.5 3.5 1.6 4.1 2.1 14 Other debt instruments 116.5 137.5 73.4 134.0 83.9 100.5 139.6 113.2 54.6 52.5 148.5 246.9 15 Consumer credit 48.8 45.4 6.3 26.7 21.0 51.3 21.9 20.6 21.4 35.9 66.6 101.4 16 Bank loans n.e.c 37.4 51.2 36.7 54.7 55.5 27.3 65.1 69.0 42.0 13.3 41.2 91.6 17 Open market paper 5.2 11.1 5.7 19.2 -4.1 -1.2 24.1 10.0 -18.2 -10.6 8.3 31.5 18 Other 25.1 29.7 24.8 33.4 11.5 23.1 28.6 13.6 9.4 13.9 32.3 22.4 19 By borrowing sector 316.2 348.6 265.4 293.1 242.8 339.8 279.9 254.0 231.7 266.9 412.7 515.4 20 State and local governments 16.5 17.6 17.2 6.2 31.3 36.7 7.3 24.1 38.5 41.9 31.6 19.0 21 Households 172.0 179.3 122.1 127.5 94.5 175.4 113.1 94.7 94.3 134.8 216.0 231.3 22 Farm 14.6 21.4 14.4 16.3 7.6 4.3 12.2 9.6 5.6 .8 7.9 .7 23 Nonfarm noncorporate 32.4 34.4 33.7 40.2 39.5 63.9 38.7 36.6 42.3 50.1 77.6 82.8 24 Corporate 80.6 96.0 78.1 102.9 70.0 59.5 108.7 89.0 51.0 39.3 79.6 181.5 25 Foreign net borrowing in United States 33.8 20.2 27.2 27.2 15.7 18.9 24.4 10.2 21.2 15.3 22.5 18.8 26 Bonds 4.2 3.9 .8 5.4 6.7 3.8 7.6 2.4 11.0 4.6 2.9 1.1 27 Bank loans n.e.c 19.1 2.3 11.5 3.7 -6.2 4.9 6.2 -7.6 -4.7 11.3 -1.5 -7.0 28 Open market paper 6.6 11.2 10.1 13.9 10.7 6.0 7.1 12.5 9.0 -4.6 16.5 18.9 29 U.S. government loans 3.9 2.9 4.7 4.2 4.5 4.3 3.5 3.0 6.0 3.9 4.6 5.8 30 Total domestic plus foreign 403.6 406.2 371.8 407.6 419.8 545.3 392.4 368.3 471.4 504.2 586.3 707.0 Financial sectors 31 Total net borrowing by financial sectors 74.1 82.4 62.9 84.1 69.0 90.7 83.9 84.2 53.8 74.0 107.3 121.0 By instrument 32 U.S. government related 37.1 47.9 44.8 47.4 64.9 67.8 50.9 60.0 69.7 66.2 69.4 69.1 33 Sponsored credit agency securities 23.1 24.3 24.4 30.5 14.9 1.4 33.2 22.4 7.5 -4.1 6.9 30.8 34 Mortgage pool securities 13.6 23.1 19.2 15.0 49.5 66.4 15.3 36.8 62.2 70.3 62.5 38.3 35 .4 .6 1.2 1.9 .4 2.4 .8 36 Private financial sectors 37.0 34.5 18.1 36.7 4.1 22.9 33.0 24.2 -16.0 7.8 38.0 51.9 37 Corporate bonds 7.5 7.8 7.1 -.8 2.5 17.1 -1.2 -2.5 7.6 15.2 18.9 14.9 38 Mortgages .1 * -.1 -.5 .1 * -.2 .1 .1 * * * 39 Bank loans n.e.c 2.3 -.5 -.9 .9 1.9 -.2 -.1 3.2 .6 -2.5 2.2 .1 40 Open market paper 14.6 18.0 4.8 20.9 -1.2 13.0 19.5 12.3 -14.7 7.2 18.8 21.1 41 Loans from Federal Home Loan Banks 12.5 9.2 7.1 16.2 .8 -7.0 15.1 11.1 -9.5 -12.1 -2.0 15.7 By sector 42 Sponsored credit agencies 23.5 24.8 25.6 32.4 15.3 1.4 35.6 23.2 7.5 -4.1 6.9 30.8 43 Mortgage pools 13.6 23.1 19.2 15.0 49.5 66.4 15.3 36.8 62.2 70.3 62.5 38.3 44 Private financial sectors 37.0 34.5 18.1 36.7 4.1 22.9 33.0 24.2 -16.0 7.8 38.0 51.9 45 Commercial banks 1.3 1.6 .5 .4 1.2 .5 .5 .7 1.7 .8 .2 4.8 46 Bank affiliates 7.2 6.5 6.9 8.3 1.9 8.6 9.7 9.7 -5.8 6.1 11.1 20.0 47 Savings and loan associations 13.5 12.6 7.4 15.5 2.5 -2.7 13.7 14.3 -9.3 -10.0 4.5 17.8 48 Finance companies 17.6 16.5 5.8 12.8 -.9 17.0 9.4 * -1.9 11.4 22.7 9.9 49 REITs -1.4 -1.3 -2.2 .2 .1 .2 .2 .1 .1 .2 .2 .1 All sectors 50 Total net borrowing 477.7 488.7 434.7 491.8 488.8 635.9 476.3 452.5 525.1 578.2 693.6 828.0 51 U.S. government securities 90.5 84.8 122.9 133.0 225.9 254.4 136.7 163.5 288.3 288.4 220.5 242.1 52 State and local obligations 28.4 30.3 30.3 22.7 53.8 56.3 24.7 43.9 63.7 62.8 49.7 38.1 53 Corporate and foreign bonds 32.8 29.0 34.6 26.4 27.8 36.5 23.2 11.8 43.8 42.8 30.3 40.0 54 Mortgages 150.2 163.5 134.9 113.9 86.5 167.2 98.5 84.8 88.2 128.5 206.0 206.3 55 Consumer credit 48.8 45.4 6.3 26.7 21.0 51.3 21.9 20.6 21.4 35.9 66.6 101.4 56 Bank loans n.e.c 58.8 52.9 47.3 59.3 51.2 32.0 71.2 64.6 37.9 22.1 41.9 84.8 57 Open market paper 26.4 40.3 20.6 54.0 5.4 17.8 50.7 34.8 -23.9 -8.0 43.6 71.5 58 Other loans 41.9 42.4 37.8 55.8 17.2 20.3 49.5 28.5 5.9 5.7 35.0 43.9 External corporate equity funds raised in United States 59 Total new share issues 1.9 -3.8 22.2 -4.1 35.3 67.8 -17.4 23.3 47.2 83.5 52.0 -37.5 60 Mutual funds -.1 .1 5.2 6.3 18.4 32.8 5.7 12.5 24.3 36.8 28.9 44.8 61 All other 1.9 -3.9 17.1 -10.4 16.9 34.9 -23.0 10.9 22.9 46.8 23.1 -82.3 62 Nonfinancial corporations -.1 -7.8 12.9 -11.5 11.4 28.3 -23.8 7.0 15.8 38.2 18.4 -84.5 63 Financial corporations 2.5 3.2 2.1 .8 4.0 2.7 1.1 3.9 4.1 2.8 2.5 2.9 64 Foreign shares purchased in United States -.5 .8 2.1 .3 1.5 4.0 -.4 -.1 3.0 5.7 2.2 -.8 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A44 DomesticN onfinancial Statistics • January 1985 1.58 DIRECT AND INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS Billions of dollars, except as noted; half-yearly data are at seasonally adjusted annual rates. 1981 1982 1983 1984 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 11997788 11997799 11998800 11998811 11998822 11998833rr H2 HI H2 HI H2' HI' 1 Total funds advanced in credit markets to domestic nonfinancial sectors 369.8 386.0 344.6 380.4 404.1 526.4 368.0 358.1 450.1 488.9 563.8 688.2 By public agencies and foreign 2 Total net advances 102.3 75.2 97.0 97.7 109.1 117.1 90.3 100.8 117.3 119.7 114.6 124.0 3 U.S. government securities 36.1 -6.3 15.7 17.2 18.0 27.6 12.4 9.7 26.2 40.5 14.6 33.3 4 Residential mortgages 25.7 35.8 31.7 23.5 61.0 76.1 25.5 47.6 74.4 80.1 72.0 52.0 5 FHLB advances to savings and loans 12.5 9.2 7.1 16.2 .8 -7.0 15.1 11.1 -9.5 -12.1 -2.0 15.7 6 Other loans and securities 28.0 36.5 42.4 40.9 29.3 20.5 37.3 32.4 26.2 11.1 29.9 23.0 Total advanced, by sector 7 U.S. government 17.1 19.0 23.7 24.1 16.0 9.7 19.8 14.8 17.1 9.1 10.3 6.7 8 Sponsored credit agencies 40.3 53.0 45.6 48.2 65.3 69.5 50.1 61.8 68.7 68.2 70.7 73.0 9 Monetary authorities 7.0 7.7 4.5 9.2 9.8 10.9 14.1 3.8 15.7 15.6 6.2 17.3 10 Foreign 38.0 -4.6 23.2 16.3 18.1 27.1 6.3 20.4 15.8 26.8 27.4 27.0 Agency and foreign borrowing not in line 1 11 Sponsored credit agencies and mortgage pools 37.1 47.9 44.8 47.4 64.9 67.8 50.9 60.0 69.7 66.2 69.4 69.1 12 Foreign 33.8 20.2 27.2 27.2 15.7 18.9 24.4 10.2 21.2 15.3 22.5 18.8 Private domestic funds advanced 13 Total net advances 338.4 379.0 319.6 357.3 375.6 495.9 353.0 327.5 423.8 450.8 541.1 652.2 14 U.S. government securities 54.3 91.1 107.2 115.8 207.9 226.9 124.3 153.7 262.0 247.8 205.9 208.8 15 State and local obligations 28.4 30.3 30.3 22.7 53.8 56.3 24.7 43.9 63.7 62.8 49.7 38.1 16 Corporate and foreign bonds 23.4 18.5 19.3 18.8 14.8 14.6 15.9 -.1 29.6 22.9 6.3 18.2 17 Residential mortgages 95.6 91.9 73.7 56.7 -3.2 40.9 40.6 11.0 -17.4 6.4 75.5 97.0 18 Other mortgages and loans 149.3 156.3 96.2 159.5 103.2 150.2 162.7 130.2 76.3 98.7 201.7 305.9 19 LESS: Federal Home Loan Bank advances 12.5 9.2 7.1 16.2 .8 -7.0 15.1 11.1 -9.5 -12.1 -2.0 15.7 Private financial intermediation 20 Credit market funds advanced by private financial institutions 315.7 313.9 281.5 323.4 285.6 376.7 323.2 274.4 296.7 323.2 430.1 521.3 21 Commercial banking 128.5 123.1 100.6 102.3 107.2 136.1 112.7 99.9 114.5 121.6 150.6 193.2 22 Savings institutions 72.3 56.5 54.5 27.8 31.3 136.8 18.4 25.2 37.4 128.9 144.6 159.1 23 Insurance and pension funds 89.5 85.9 94.3 97.4 108.8 98.8 101.4 111.4 106.3 89.5 108.1 98.5 24 Other finance 25.5 48.5 32.1 96.0 38.3 5.0 90.8 37.9 38.6 -16.8 26.8 70.5 25 Sources of funds 315.7 313.9 281.5 323.4 285.6 376.7 323.2 274.4 296.7 323.2 430.1 521.3 26 Private domestic deposits and RPs 142.7 137.4 169.6 211.9 174.7 203.5 217.9 147.6 201.9 192.7 214.2 283.0 27 Credit market borrowing 37.0 34.5 18.1 36.7 4.1 22.9 33.0 24.2 -16.0 7.8 38.0 51.9 28 Other sources 136.1 142.0 93.9 74.8 106.7 150.4 72.3 102.6 110.8 122.8 177.9 186.4 29 Foreign funds 6.5 27.6 -21.7 -8.7 -26.7 22.1 -9.8 -28.3 -25.1 -14.2 58.5 17.1 30 Treasury balances 6.8 .4 -2.6 -1.1 6.1 -5.3 -10.2 -2.0 14.1 10.1 -20.8 1.4 31 Insurance and pension reserves 74.9 72.8 83.9 90.4 104.6 99.2 101.0 111.4 97.8 90.(K 108.4 105.5 32 Other, net 47.9 41.2 34.2 -5.9 22.8 34.4 -8.7 21.5 24.1 36.8' 31.9 62.4 Private domestic nonfinancial investors 33 Direct lending in credit markets 59.6 99.6 56.1 70.6 94.2 142.1 62.8 77.3 111.0 135.3 148.9 182.7 34 U.S. government securities 33.5 52.5 24.6 29.3 37.4 88.7 24.5 35.3 39.5 95.9 81.4 134.4 35 State and local obligations 3.6 9.9 7.0 10.5 34.4 42.5 12.5 30.1 38.7 52.7 32.3 21.8 36 Corporate and foreign bonds -6.3 -1.4 -5.7 -8.1 -5.2 2.0 -10.7 -17.7 7.3 -1.7 5.7 7.2 37 Open market paper 8.3 8.6 -3.1 2.7 -.1 3.9 8.2 3.5 -3.7 -8.1 15.9 -.3 38 Other 20.5 30.0 33.3 36.3 27.8 5.0 28.4 26.2 29.3 -3.4 13.5 19.7 39 Deposits and currency 153.9 146.8 181.1 221.9 181.9 222.6 229.3 152.1 211.7 214.5 230.7 294.5 40 Currency 9.3 8.0 10.3 9.5 9.7 14.3 11.2 6.7 12.7 14.8 13.8 17.7 41 Checkable deposits 16.2 18.3 5.2 18.0 15.7 21.7 13.3 1.9 29.5 48.0 -4.7 37.8 42 Small time and savings accounts 65.9 59.3 82.9 47.0 138.2 219.1 71.8 83.2 193.1 278.6 159.7 127.9 43 Money market fund shares 6.9 34.4 29.2 107.5 24.7 -44.1 110.8 39.4 10.0 -84.0 -4.2 30.2 44 Large time deposits 46.3 18.8 45.8 36.9 -7.7 -7.5 24.6 21.9 -37.3 -61.0 45.9 81.8 45 Security RPs 7.5 6.6 6.5 2.5 3.8 14.3 -2.6 1.1 6.6 11.0 17.5 5.3 46 Deposits in foreign countries 2.0 1.5 1.1 .5 -2.5 4.8 .2 -2.2 -2.9 7.0 2.7 -6.2 47 Total of credit market instruments, deposits and currency 213.6 246.5 237.2 292.5 276.1 364.7 292.1 229.4 322.7 349.8 379.6 477.3 48 Public holdings as percent of total 25.3 18.5 26.1 24.0 26.0 21.5 23.0 27.4 24.9 23.7 19.5 17.5 49 Private financial intermediation (in percent) 93.3 82.8 88.1 90.5 76.0 76.0 91.6 83.8 70.0 71.7 79.5 79.9 50 Total foreign funds 44.6 23.0 1.5 7.6 -8.6 49.2 -3.5 -7.9 -9.3 12.6 85.9 44.1 MEMO: Corporate equities not included above SI Total net issues 1.9 -3.8 22.2 -4.1 35.3 67.8 -17.4 23.3 47.2 83.5 52.0 -37.5 52 Mutual fund shares -.1 .1 5.2 6.3 18.4 32.8 5.7 12.5 24.3 36.8 28.9 44.8 53 Other equities 1.9 -3.9 17.1 -10.4 16.9 34.9 -23.0 10.9 22.9 46.8 23.1 -82.3 54 Acquisitions by financial institutions 4.7 12.9 24.9 20.1 39.2 57.5 22,6 11.0 67.3 75.9' 39.2 4.2 55 Other net purchases -2.8 -16.7 -2.7 -24.2 -3.9 10.2 -40.0 12.3 -20.1 7.6' 12.8 -41.7 NOTES BY LINE NUMBER. 32. Mainly retained earnings and net miscellaneous liabilities. 1. Line 1 of table 1.58. 33. Line 12 less line 20 plus line 27. 2. Sum of lines 3-6 or 7-10. 34-38. Lines 14-18 less amounts acquired by private finance. Line 38 includes 6. Includes farm and commercial mortgages. mortgages. 11. Credit market funds raised by federally sponsored credit agencies, and net 40. Mainly an offset to line 9. issues of federally related mortgage pool securities. 47. Lines 33 plus 39, or line 13 less line 28 plus 40 and 46. 13. Line 1 less line 2 plus line 11 and 12. Also line 20 less line 27 plus line 33. Also 48. Line 2/line 1. sum of lines 28 and 47 less lines 40 and 46. 49. Line 20/line 13. 18. Includes farm and commercial mortgages. 50. Sum of lines 10 and 29. 26. Line 39 less lines 40 and 46. 51. 53. Includes issues by financial institutions. 27.-Excludes equity issues and investment company shares. Includes line 19. NOTE. Full statements for sectors and transaction types in flows and in amounts 29. Foreign deposits at commercial banks, bank borrowings from foreign outstanding may be obtained from Flow of Funds Section, Division of Research branches, and liabilities of foreign banking agencies to foreign affiliates. and Statistics, Board of Governors of the Federal Reserve System, Washington, 30. Demand deposits at commercial banks. D.C. 20551. 3J. Excludes net investment of these reserves in corporate equities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A45 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures 1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted. 1984 MMeeaassuurree 11998811 11998822 11998833 Feb. Mar. Apr. May June July Aug. Sept.' Oct. 1 Industrial production 151.0 138.6 147.6 160.0 160.8 162.1 162.8 164.4 165.9 166.1 165.2 165.2 Market groupings ? Products, total 150.6 141.8 149.2 160.4 161.1 162.5 163.3 116655..33 167.4 116677..33'' 116666..99 116677..11 3 Final, total 149.5 141.5 147.1 158.0 158.6 160.2 161.1 163.1 165.2 165.2' 164.9 165.3 4 Consumer goods 147.9 142.6 151.7 159.4 160.2 161.4 161.7 163.0 163.8' 162.5' 161.6 161.9 Equipment 151.5 139.8 140.8 156.1 156.4 158.5 160.3 163.3 167.0' 168.8 169.3 170.0 6 Intermediate 154.4 143.3 156.6 169.0 170.2 171.0 171.6 173.5 175.8' 175.2' 174.3 173.8 7 Materials 151.6 133.7 145.2 159.4 160.4 161.5 162.0 162.9 163.5' 164.3' 162.8 162.1 Industry groupings 8 Manufacturing 150.4 137.6 148.2 161.4 162.1 163.4 164.2 116655..77 167.3' 116677..88 116666..99 116677..22 Capacity utilization (percent)1 9 Manufacturing 79.4 71.1 75.2 80.9 81.0 81.5 81.7 82.2 82.9 82.8 8822..22 82.1 10 Industrial materials industries 80.7 70.1 75.2 81.9 82.2 82.5 82.7 82.9 83.1 83.3' 82.4 81.9 11 Construction contracts (1977 = 100)2 111.0 111.0 138.0 150.0 144.0 145.0 165.0 148.0 152.0 151.0 144.0 144.0 12 Nonagricultural employment, total3 138.5 136.1' 137.0 141.1 141.4 142.0 142.5 143.1 143.4 143.6' 144.0 144.7 13 Goods-producing, total 109.4 102.2' 100.4 105.4 105.5 106.2 106.6 107.1 107.5 107.7' 107.3 107.6 14 Manufacturing, total 103.7 96.6' 95.1 99.6 100.1 100.4 100.6 100.9 101.3 101.4 100.8 101.1 15 Manufacturing, production-worker ... 98.0 89.4' 88.7 93.1 93.6 94.0 94.1 94.3 94.6 94.8 94.0 94.4 16 Service-producing 154.4 154.7' 157.1 160.7 161.1 161.6 162.2 162.8 163.1 163.4 164.1 165.0 17 Personal income, total 386.5 410.3' 435.6 464.0 466.8 471.2 472.8 477.2 480.4 483.3' 487.5 n.a. 18 Wages and salary disbursements 349.7 367.4 388.6 411.0 413.3 418.1 419.2 422.6 424.6 425.3' 428.1 n.a. 19 Manufacturing 287.5' 285.5 294.7 317.1 318.8 322.0 321.9 323.1 324.4 326.2' 324.8 n.a. 20 Disposable personal income4 372.6 398.0 427.1 457.1 459.9 464.2 465.3 469.1 472.4 475.5 479.1 481.9 21 Retail sales5 330.6 326.0 373.0 403.0 396.9 410.8 413.6 417.7 410.5 407.3 412.2 411.6 Prices6 V Consumer 272.4 289.1 298.4 306.6 307.3 308.8 309.7 310.7 311.7 313.0 314.5 n.a. 23 Producer finished goods 269.8 280.7 285.2 290.6 291.4 291.2 291.1' 291.2 292.6 291.8 289.8 n.a. 1. Ratios of indexes of production to indexes of capacity. Based on data from 5. Based on Bureau of Census data published in Survey of Current Business. Federal Reserve, McGraw-Hill Economics Department, Department of Com- 6. Data without seasonal adjustment, as published in Monthly Labor Review. merce, and other sources. Seasonally adjusted data for changes in the price indexes may be obtained from 2. 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 6, 3. Based on data in Employment and Earnings (U.S. Department of Labor). and indexes for series mentioned in notes 3 and 7 may also be found in the Survey Series covers employees only, excluding personnel in the Armed Forces. of Current Business. 4. Based on data in Survey of Current Business (U.S. Department of Com- Figures for industrial production for the last two months are preliminary and merce). estimated, respectively. 2.11 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data are seasonally adjusted. Exceptions noted. 1984 CCaatteeggoorryy 11998811 11998822 11998833 Mar. Apr. May June July Aug. Sept. Oct. HOUSEHOLD SURVEY DATA 1 Noninstitutional population1 172,272 174,450 176,414 178,033 178,185 178,337 178,501 178,669 178,821 179,005 179,181 2 Labor force (including Armed Forces)1 110,812 112,383 113,749 115,121 115,461 116,017 116,094 116,167 115,732 115,941 116,242 3 Civilian labor force 108,670 110,204 111,550 112,912 113,245 113,803 113,877 113,938 113,494 113,699 114,017 4 Nonagricultural industries2 97,030 96,125 97,450 100,859 101,009 101,899 102,344 102,050 101,744 101,923 102,472 5 Agriculture 3,368 3,401 3,383 3,281 3,393 3,389 3,403 3,345 3,224 3,315 3,114 Unemployment 6 Number 8,273 10,678 10,717 8,772 8,843 8,514 8,130 8,543 88,,552266 8,460 8,431 7 Rate (percent of civilian labor force) ... 7.6 9.7 9.6 7.8 7.8 7.5 7.1 7.5 7.5 7.4 7.4 8 Not in labor force 61,460 62,067 62,665 62,912 62,724 62,320 62,407 62,502 63,089 63,064 62,939 ESTABLISHMENT SURVEY DATA 9 Nonagricultural payroll employment3 91,156 89,566' 90,138' 93,058 93,449 93,786' 94,135' 94,350 94,523' 94,754' 95,195 10 Manufacturing 20,170 18,781' 18,497' 19,466 19,530 19,570 19,629' 19,696 19,725 19,611' 19,667 11 Mining 1,132 1,128' 957' 978 984 995 1,002' 1,007 1,017 1,020' 1,016 V Contract construction 4,176 3,903' 3,940' 4,151 4,246 4,286 4,343' 4,356 4,356' 4,374' 4,388 13 Transportation and public utilities 5,157 5,082' 4,958' 5,112 5,129 5,144 5,163' 5,175 5,202' 5,211' 5,238 14 Trade 20,551 20,457' 20,804' 21,493 21,568 21,658 21,747' 21,811 21,839' 21,924' 22,089 15 Finance 5,301 5,341' 5,467' 5,613 5,640 5,662 5,676 5,676 5,679' 5,684 5,712 16 Service 20,547 19,036' 19,665' 20,378 20,449 20,549 20,681' 20,701 20,748' 20,870' 20,998 17 Government 16,024 15,837' 15,851' 15,873 15,903 15,922' 15,894' 15,928 15,957' 16,06C 16,087 1. Persons 16 years of age and over. Monthly figures, which are based on 3. Data include all full- and part-time employees who worked during, or sample data, relate to the calendar week that contains the 12th day; annual data received pay for, the pay period that includes the 12th day of the month, and are averages of monthly figures. By definition, seasonality does not exist in exclude proprietors, self-employed persons, domestic servants, unpaid family population figures. Based on data from Employment and Earnings (U.S. Depart- workers, and members of the Armed Forces. Data are adjusted to the March 1983 ment of Labor). 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 • January 1985 2.12 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION Seasonally adjusted 1983 1984 1983 1984 1983 1984 Q4 Ql Q2 Q3' Q4 Ql Q2 Q3 Q4 Ql Q2 Q3r Output (1967 = 100) Capacity (percent of 1967 output) Utilization rate (percent) I Total industry 155.5 159.8 163.1 165.7 197.3 198.4 199.7 201.1 78.8 80.5 81.7 77.6 2 Mining 121.0 124.2 125.1 128.9 165.5 165.7 165.9 166.1 73.1 75.0 75.4 83.4 3 Utilities 178.4 179.2 183.1 180.9 212.4 213.8 215.3 216.8 84.0 83.8 '85.0 83.9 4 Manufacturing 156.5 161.0 164.4 167.3 198.4 199.5 201.0 202.5 78.9 80.7 81.8 82.6 5 Primary processing ... 156.4 160.5 162.5 162.5 195.8 196.5 197.2 198.0 79.9 81.7 82.4 82.1 6 Advanced processing , 156.1 161.7 165.2 169.8 199.7 201.1 203.0 204.9 78.2 80.3 81.4 82.9 7 Materials 154.3 158.8 162.1 163.5 194.0 194.7 195.9 197.2 79.6 81.6 82.7 82.9 8 Durable goods 150.3 157.6 162.0 164.6 196.5 197.1 198.3 199.5 76.5 79.9 81.7 82.5 9 Metal materials .... 93.8 97.3 100.3 97.2 139.6 139.1 138.5 137.9 67.2 70.0 72.4 70.5 10 Nondurable goods.... 183.5 183.7 186.6 186.3 220.6 221.8 223.4 225.2 83.2 82.8 83.5 82.7 11 Textile, paper, and chemical.. 193.2 193.2 195.9 195.6 232.7 234.2 236.2 238.2 83.0 82.5 82.9 82.1 12 Paper 167.4 165.8 168.5 171.2 167.7 168.5 169.5 170.5 99.8 98.4 99.4 100.4 13 Chemical 235.0 236.7 240.4 239.3 300.1 302.3 305.2 308.0 78.3 78.3 78.8 77.7 14 Energy materials 127.8 131.2 132.4 133.0 155.3 155.8 156.4 157.0 82.3 84.2 84.6 84.7 Previous cycle1 Latest cycle2 1983 1984 High Low High Low Oct. Feb. Mar. Apr. May June July' Aug/ Sept/ Oct. Capacity utilization rate (percent) 15 Total industry 88.4 71.1 87.3 69.6 78.7 80.7 80.9 81.3 81.5 82.1 82.7 82.6 82.0 81.8 16 Mining 91.8 86.0 88.5 69.6 71.5 74.9 74.7 74.3 75.4 76.6 78.3 77.4 77.3 74.4 17 Utilities 94.9 82.0 86.7 79.0 83.3 82.5 84.0 85.0 84.7 85.4 84.1 83.3 82.9 82.8 18 Manufacturing 87.9 69.0 87.5 68.8 78.9 80.9 81.0 81.5 81.7 82.2 82.8 82.8 82.2 82.1 19 Primary processing .. . 93.7 68.2 91.4 66.2 80.4 82.2 82.2 82.2 82.4 82.6 82.3 82.3 81.7 81.8 20 Advanced processing . 85.5 69.4 85.9 70.0 77.9 80.4 80.6 81.0 81.2 81.9 83.0 83.1 82.5 82.2 21 Materials 92.6 69.3 88.9 66.6 79.5 81.9 82.2 82.5 82.7 82.9 83.1 83.3 82.4 81.9 22 Durable goods 91.4 63.5 88.4 59.8 76.1 80.5 80.7 81.5 81.5 82.0 82.5 83.0 81.9 81.6 23 Metal materials 97.8 68.0 95.4 46.2 68.0 71.1 71.5 73.0 72.2 72.1 70.8 71.7 69.0 69.4 24 Nondurable goods .... 94.4 67.4 91.7 70.7 84.1 83.0 83.6 83.2 83.9 83.3 83.0 82.9 82.2 82.2 25 Textile, paper, and chemical 95.1 65.4 92.3 68.6 84.1 82.8 83.1 82.7 83.3 82.6 82.5 82.5 81.4 81.4 26 Paper 99.4 72.4 97.9 86.3 99.4 99.0 96.8 98.5 99.8 99.8 101.5 99.7 100.0 99.3 27 Chemical 95.5 64.2 91.3 64.0 79.7 78.6 79.5 78.9 79.0 78.4 77.9 78.1 77.0 77.4 28 Energy materials 94.5 84.4 88.9 78.5 81.4 84.1 84.1 84.5 84.3 85.0 85.3 84.8 84.1 82.0 1. Monthly high 1973; monthly low 1975. NOTE. These data also appear in the Board's G.3 (402) release. For address, see 2. Monthly highs 1978 through 1980; monthly lows 1982. inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A47 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value Monthly data are seasonally adjusted 1967 1983 1984 GGrroouuppiinngg p p r o o r- - 11 a 99 v 88 g 33 . tion Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July' Aug. Sept.? Index (1967 = 100) MAJOR MARKET 1 Total index 100.00 147.6 155.0 155.3 156.2 158.5 160.0 160.8 162.1 162.8 164.4 165.9 166.1 165.2 2 Products 60.71 149.2 155.6 155.8 157.4 159.7 160.4 161.1 162.5 163.3 165.3 167.4 167.3 166.9 3 Final products 47.82 147.1 152.7 153.2 155.2 157.5 158.0 158.6 160.2 161.1 163.1 165.2 165.2 164.9 4 Consumer goods 27.68 151.7 156.9 156.1 157.7 159.5 159.4 160.2 161.4 161.7 163.0 163.8 162.5 161.6 .5 Equipment 20.14 140.8 147.0 149.1 151.8 154.9 156.1 156.4 158.5 160.3 163.3 167.0 168.8 169.3 6 Intermediate products 12.89 156.6 166.5 165.5 165.4 167.8 169.0 170.2 171.0 171.6 173.5 175.8 175.2 174.3 7 Materials 39.29 145.2 154.0 154.5 154.5 156.6 159.4 160.4 161.5 162.0 162.9 163.5 164.3 162.8 Consumer goods 8 Durable consumer goods 7.89 147.5 156.7 155.9 158.6 163.4 162.5 163.1 162.2 161.4 163.6 163.7 162.8 160.2 9 Automotive products 2.83 158.2 171.3 171.5 178.4 184.5 182.1 184.1 180.9 179.8 184.3 185.0 182.2 172.7 10 Autos and utility vehicles 2.03 134.0 149.2 149.2 157.8 163.3 162.2 164.1 158.4 155.9 158.7 161.1 159.2 145.6 11 Autos 1.90 117.4 129.6 129.4 137.4 140.7 140.4 142.4 134.5 132.9 136.2 138.7 134.3 121.1 12 Auto parts and allied goods .80 219.6 227.4 228.2 230.7 238.4 232.6 234.7 238.0 240.6 249.3 245.8 240.5 241.2 N Home goods 5.06 141.4 148.4 147.2 147.5 151.5 151.5 151.3 151.7 151.1 152.0 151.8 151.9 153.2 14 Appliances, A/C, and TV 1.40 116.4 129.2 127.0 126.3 136.4 135.1 134.4 136.1 134.0 134.9 133.4 132.3 136.8 15 Appliances and TV 1.33 120.1 133.3 131.3 130.2 140.0 138.6 138.0 138.8 136.7 138.0 136.9 135.9 140.6 16 Carpeting and furniture 1.07 178.1 185.5 182.7 184.0 183.1 178.7 180.2 181.0 179.6 179.4 179.5 180.8 179.5 17 Miscellaneous home goods 2.59 139.9 143.6 143.4 143.9 146.7 149.1 148.5 148.0 148.6 150.0 150.3 150.6 151.3 18 Nondurable consumer goods 19.79 153.4 157.1 156.1 157.3 157.9 158.2 159.1 161.1 161.8 162.7 163.9 162.4 162.2 19 4.29 70 Consumer staples 15.50 163.7 167.2 165.4 166.0 166.5 166.9 168.0 170.2 171.6 173.2 174.5 172.8 172.9 ">1 8.33 153.5 156.0 154.5 155.4 156.5 156.8 157.6 160.4 161.0 161.9 162.9 161.7 22 Nonfood staples 7.17 175.4 180.3 178.1 178.3 178.2 178.7 180.1 181.6 183.9 186.3 188.0 185.7 185.4 23 Consumer chemical products .... 2.63 231.0 238.7 232.4 229.9 231.6 231.9 231.3 233.4 235.9 241.5 247.1 244.3 242.3 74 Consumer paper products 1.92 132.7 137.6 136.6 137.2 138.8 140.3 141.8 144.0 145.6 147.9 151.5 149.7 149.8 25 Consumer energy products 2.62 150.9 153.0 154.1 156.5 153.4 153.3 156.8 157.1 159.8 159.0 155.3 153.3 154.3 2266 11..4455 117733..44 117744..55 117755..88 118855..22 118800..00 117722..88 117777..77 117777..44 118811..11 118822..44 117788..66 117755..00 Equipment 27 Business 12.63 153.3 161.3 164.1 167.3 170.7 171.9 172.1 173.5 176.5 181.1 185.5 187.8 118888..00 28 Industrial 6.77 120.4 126.6 128.6 130.8 133.7 134.6 134.8 135.9 138.5 140.4 143.1 143.3 142.7 29 Building and mining 1.44 159.3 166.9 175.8 185.3 185.1 182.0 175.2 173.6 182.9 185.8 190.0 191.6 190.7 10 Manufacturing 3.85 107.1 114.6 114.3 115.1 119.7 120.9 124.2 126.2 127.4 128.6 130.1 129.7 129.8 31 Power 1.47 117.1 118.5 119.4 118.4 120.0 123.8 122.7 124.1 124.1 126.7 131.0 131.2 129.5 32 Commercial transit, farm 5.86 191.3 201.3 205.1 209.6 213.3 215.1 215.3 217.0 220.5 228.1 234.5 239.3 240.2 33 Commercial 3.26 273.2 288.1 292.5 298.9 303.2 305.9 306.9 309.6 315.5 326.3 333.4 339.5 344.9 34 Transit 1.93 95.2 100.0 103.2 106.0 110.1 110.1 109.2 108.9 109.7 115.1 120.4 125.2 121.3 35 Farm .67 69.5 70.9 73.5 73.5 73.6 75.7 75.0 78.0 77.1 76.1 81.8 80.3 73.6 36 Defense and space 7.51 119.9 122.9 124.0 125.7 128.3 129.5 130.1 133.2 133.1 133.5 135.9 136.8 138.0 Intermediate products 37 Construction supplies 6.42 142.5 152.3 151.6 151.5 155.5 156.6 159.1 159.6 159.5 160.9 161.9 161.2 159.7 38 Business supplies 6.47 170.7 180.6 179.4 179.3 180.1 181.3 181.3 182.3 183.5 186.1 189.5 189.0 188.8 39 Commercial energy products 1.14 184.3 187.0 187.6 188.0 192.1 191.6 187.0 190.0 190.8 195.3 194.9 193.3 191.7 Materials 40 Durable goods materials 20.35 138.6 149.4 150.3 151.3 154.6 158.6 159.5 161.3 161.6 163.0 164.2 165.7 163.8 41 Durable consumer parts 4.58 113.6 124.9 125.0 127.9 131.6 133.1 133.0 133.2 132.6 134.7 135.1 136.6 133.8 42 Equipment parts 5.44 176.4 188.3 192.5 193.4 198.2 204.0 206.7 210.9 210.6 214.0 218.8 220.1 219.0 43 Durable materials n.e.c 10.34 129.9 139.8 139.3 139.5 141.8 146.0 146.3 147.7 148.6 148.7 148.3 149.9 148.0 44 Basic metal materials 5.57 90.2 98.0 97.1 96.9 97.7 103.0 103.0 105.7 104.5 104.1 103.4 103.3 99.9 45 Nondurable goods materials 10.47 174.5 185.3 184.8 180.3 181.2 184.1 185.9 185.7 187.4 186.7 186.5 186.8 185.5 46 Textile, paper, and chemical materials 7.62 182.6 195.4 194.7 189.6 190.5 193.9 195.3 195.0 196.8 195.8 195.9 196.4 194.4 47 Textile materials 1.85 116.2 124.0 121.9 121.3 119.9 119.9 120.6 118.9 121.9 119.6 118.8 120.9 117.6 48 Paper materials 1.62 158.2 166.3 169.8 166.0 167.0 166.8 163.5 166.7 169.2 169.5 172.8 170.0 170.8 49 Chemical materials 4.15 221.7 238.7 237.0 229.3 231.3 237.6 241.1 240.0 241.1 240.2 239.3 240.5 238.0 50 Containers, nondurable 1.70 167.9 175.9 176.6 173.0 173.5 173.0 176.0 175.7 176.6 176.7 176.6 175.3 175.4 51 Nondurable materials n.e.c 1.14 130.5 131.9 130.6 129.5 130.5 135.2 137.7 138.6 140.5 140.5 138.8 139.6 141.0 52 Energy materials 8.48 124.8 126.3 127.1 130.0 131.3 131.0 131.3 132.1 131.9 133.2 133.7 133.1 132.2 53 Primary energy 4.65 114.7 114.1 115.5 117.6 119.3 121.3 119.6 119.5 119.8 120.1 122.7 122.0 121.1 54 Converted fuel materials 3.82 137.0 141.2 141.1 145.1 145.8 142.8 145.4 147.3 146.5 149.0 147.1 146.5 145.7 Supplementary groups 55 Home goods and clothing 9.35 129.9 135.5 135.9 137.6 140.1 140.3 140.1 141.0 139.8 139.6 139.7 139.6 139.6 56 Energy, total 12.23 135.9 137.7 138.5 141.1 141.6 141.4 141.9 142.8 143.3 144.5 144.0 143.0 142.5 57 Products 3.76 161.0 163.3 164.3 166.0 165.1 164.9 166.0 167.1 169.2 170.0 167.3 165.4 165.7 58 Materials 8.48 124.8 126.3 127.1 130.0 131.3 131.0 131.3 132.1 131.9 133.2 133.7 133.1 132.2 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 Domestic Nonfinancial Statistics • January 1985 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value—Continued 1967 1983 1984 SIC pro- 1983 Grouping code por- avg. tion Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept.'' Oct.'' Index (1967 = 100) MAJOR INDUSTRY 1 Mining and utilities. 12.05 142.9 145.8 147.2 151.5 151.4 148.9 150.4 151.3 152.1 154.1 154.4 153.1 152.9 150.4 2 Mining 6.36 116.6 118.3 121.1 123.7 124.8 124.1 123.8 123.3 125.0 127.0 129.9 128.5 128.4 123.7 3 Utilities 5.69 172.4 176.5 176.3 182.5 181.0 176.5 180.0 182.7 182.3 184.3 181.8 180.6 180.2 180.3 4 Electric 3.88 196.0 200.7 200.2 208.0 206.8 200.0 204.6 207.7 206.8 209.6 205.9 204.0 203.5 203.3 5 Manufacturing 87.95 148.2 156.2 156.4 156.8 159.5 161.4 162.1 163.4 164.2 165.7 167.3 167.8 166.9 167.2 6 Nondurable 35.97 168.1 175.6 174.8 173.9 175.2 177.2 177.6 179.1 179.9 181.3 181.8 181.7 180.8 181.4 7 Durable 51.98 134.5 142.8 143.6 145.0 148.6 150.5 151.4 152.6 153.3 154.9 157.2 158.1 157.2 157.3 Mining 8 Metal 10 .51 80.9 81.0 84.6 82.3 89.4 97.4 100.0 98.5 98.0 96.8 96.4 83.4 81.3 9 Coal 11.12 .69 136.3 142.7 144.8 145.2 151.5 163.2 164.0 151.4 153.9 161.5 176.5 171.7 173.7 129.6 10 Oil and gas extraction 13 4.40 116.6 117.3 119.8 123.4 123.1 119.6 118.2 118.8 120.4 121.6 122.8 122.8 122.4 122.8 11 Stone and earth minerals 14 .75 122.8 127.4 132.2 133.9 134.8 133.0 135.8 140.4 144.0 147.9 151.9 153.5 154.0 Nondurable manufactures 12 Foods 20 8.75 156.4 157.6 157.1 157.7 159.4 160.0 161.2 163.1 164.2 165.1 164.9 164.6 13 Tobacco products 21 .67 112.1 109.1 109.5 112.3 116.4 110.9 111.8 113.3 112.8 118.3 115.1 113.8 14 Textile mill products 22 2.68 140.8 148.7 145.8 145.0 143.9 142.3 143.5 140.0 140.5 140.7 139.8 140.5 138.4 15 Apparel products 23 3 31 16 Paper and products 26 3.21 164.3 171.5 172.1 170.1 172.3 176.6 173.8 172.4 174.1 174.6 176.7 176.8 177,2 178.5 17 Printing and publishing 27 4.72 152.5 162.7 162.0 161.7 163.4 164.8 165.2 166.3 167.5 169.0 172.6 174.1 173.8 174.0 18 Chemicals and products 28 7.74 215.0 228.4 225.6 221.1 221.5 224.8 225.0 228.3 227.9 231.0 232.0 231.5 230.0 19 Petroleum products 29 1.79 120.3 123.6 125.4 114.4 118.8 127.6 127.0 126.8 127.9 127.5 124.7 124.3 122.9 124.9 20 Rubber and plastic products 30 2.24 291.9 310.8 309.1 314.4 317.2 318.5 323.8 328.0 334.1 341.0 341.4 341.5 338.4 21 Leather and products 31 .86 61.9 64.0 63.2 66.0 61.4 63.9 63.9 63.5 61.4 60.0 60.6 59.9 60.6 Durable manufactures 22 Ordnance, private and government 19.91 3.64 95.4 98.8 99.3 99.8 99.7 99.6 100.6 101.4 100.8 101.7 102.7 105.0 106.3 107.3 23 Lumber and products 24 1.64 137.2 141.7 141.0 143.8 146.0 145.6 149.3 151.2 146.3 148.5 146.0 148.8 150.4 24 Furniture and fixtures 25 1 37 170 5 181.0 177 5 177 9 183 8 185.6 184.6 186.6 190.5 191.9 192.6 195.5 195.0 25 Clay, glass, stone products 32 2 74 143 4 151 9 152 7 153 8 157 8 160.4 160.2 160 0 160.6 159.7 160.9 161.3 159.5 26 Primary metals 33 6.57 85.4 95.3 92.2 90.4 93.2 98.4 97.5 99.3 98.2 97.9 94.5 95.3 93.3 94.0 27 Iron and steel 331.2 4.21 71.5 84.3 79.2 74.1 80.7 86.0 84.4 84.0 83.5 83.5 76.5 77.5 75.5 28 Fabricated metal products 34 5.93 120.2 26.9 128.5 129.2 131.7 132.8 134.9 135.5 136.5 138.7 140.6 140.2 139.6 139.9 29 Nonelectrical machinery 35 9.15 150.6 159.2 161.8 164.3 169.5 170.9 171.9 174.9 178.8 182.0 186.9 189.6 189.7 190.9 30 Electrical machinery 36 8.05 185.5 198.4 200.1 201.5 206.2 209.9 212.0 214.6 214.5 216.0 221.5 221.4 222.3 221.5 31 Transportation equipment 37 9.27 117.8 125.5 127.3 130.8 134.9 135.2 135.8 134.5 135.0 137.2 140.6 141.2 137.0 136.6 32 Motor vehicles and parts 371 4.50 137.1 150.9 152.9 158.9 166.3 164.4 165.8 161.9 163.0 165.3 169.0 169.9 160.6 159.0 33 Aerospace and miscellaneous transportation equipment.. 372-9 4.77 99.6 101.6 103.2 104.3 105.3 107.7 107.5 108.8 108.6 110.8 113.8 114.2 114.8 115.5 34 Instruments 38 2.11 158.7 163.0 163.0 164.6 167.8 168.6 169.7 171.0 171.8 174.5 176.7 177.4 177.7 177.8 35 Miscellaneous manufactures 39 1.51 146.2 149.1 148.9 149.3 151.1 152.0 152.3 152.1 151.5 150.8 152.4 149.2 148.2 147.5 Gross value (billions of 1972 dollars, annual rates) MAJOR MARKET 36 Products, total 507.4 612.6 637.8 638.4 645.4 655.1 656.9 661.8 661.1 665.9 671.5 682.4 678.3 673.1 673.8 37 Final 390.9 472.6 490.7 490.8 497.8 505.3 505.0 509.6 509.0 514.0 518.1 525.9 522.3 518.3 519.4 38 Consumer goods 277.5 328.7 340.2 338.3 341.9 345.3 345.3 347.7 347.8 349.5 350.9 353.2 347.0 343.6 344.8 39 Equipment 113.4 144.0 150.5 152.5 155.9 160.0 159.7 161.9 161.2 164.4 167.2 172.8 175.3 174.7 174.6 40 Intermediate 111166..66 114400..00 114477..11 147.6 147.6 149.8 151.9 152.2 152.2 151.9 153.4 156.5 156.0 154.8 154.4 NOTE. These data also appear in the Board's G.12.3 (414) release. For address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A49 2.14 HOUSING AND CONSTRUCTION Monthly figures are at seasonally adjusted annual rates except as noted. 1984 IItteemm 11998811 11998822 11998833 Jan. Feb. Mar. Apr. May June July Aug. Sept/ Oct. Private residential real estate activity (thousands of units) NEW UNITS 1 Permits authorized 986 1,000 1,605 1,799 1,902 1,727 1,758 1,745 1,768 1,565 1,506 1,440 1,408 2 1-family 564 546 902 989 1,083 974 957 913 916 823 803 841 780 3 2-or-more-family 421 454 703 810 819 753 801 832 852 742 703 599 628 4 Started 1,084 1,062 1,703 1,980 2,262 1,662 2,015 1,794 1,877 1,754 1,554' 1,679 1,515 5 1-family 705 663 1,067 1,301 1,463 1,071 1,196 1,131 1,084 990 932 1,020 925 6 2-or-more-family 379 400 635 679 799 591 819 663 793 764 622' 659 590 7 Under construction, end of period1 682 720 1,003 1,032 1,033 1,065 1,091 1,094 1,101 1,105' 1,094' 1,097 8 1-family 382 400 524 552 557 571 582 589 589 586' 575' 571 9 2-or-more-family 301 320 479 480 477 494 509 506 512 519' 519^ 526 10 Completed 1,266 1,005 1,390 1,606 1,565 1,590 1,654 1,756 1,739 1,718' 1,684' 1,642 11 1-family 818 631 924 1,014 1,034 1,031 974 1,08! 1,051 1,076' 1,038' 1,053 12 2-or-more-family 447 374 466 592 531 559 680 675 688 642' 646' 589 13 Mobile homes shipped 241 240 295 314 293 287 287 295 301 301 303 277 n a. Merchant builder activity in 1-family units 14 Number sold 436 413 622 681 712 682 649 616 635 611 557 679 15 Number for sale, end of period1 278 255 304 302 320 320 328 333 339 342 346 345 PPrriiccee ((tthhoouussaannddss ooff ddoollllaarrss))11 MMeeddiiaann 1166 UUnniittss ssoolldd 68.8 69.3 75.5 76.2 79.2 78.4 79.6 81.4 80.5 80.9 79.7 80.0 AAvveerraaggee 1177 UUnniittss ssoolldd 83.1 83.8 89.9 92.2 94.4 97.7 96.2 101.9 98.8 97.5 95.4 101.0 EXISTING UNITS (1-family) 18 Number sold 2,418 1,991 2,719 2,890 2,910 3,020 3,090 3,060 2,960 2,770 2,700 2,670 2,670 Price of units sold (thousands of dollars)2 19 Median 66.1 67.7 69.8 71.3 71.8 72.2 72.5 73.1 73.8 74.5 73.7 72.1 72.3 20 Average 78.0 80.4 82.5 84.8 84.9 85.1 86.1 86.2 87.7 88.2 87.8 85.6 86.3 Value of new construction3 (millions of dollars) CONSTRUCTION 21 Total put in place 239,112 230,068 262,167 280,897 300,355 309,744 308,596 316,398 315,279 310,978 311,945 315,287 ?? Private 185,761 179,090 211,369 229,972 248,104 254,958 254,057 261,182 257,789 254,778 255,334 257,794 73 Residential 86,564 74,808 111,727 121,931 137,403 141,087 136,577 138,401 136,418 135,288 133,986 132,815 74 Nonresidential, total 99,197 104,282 99,642 108,041 110,701 113,871 117,480 122,781 121,371 119,490 121,348 124,979 Buildings 75 Industrial 17,031 17,346 12,863 12,872 13,969 14,363 13,633 15,170 14,065 13,585 14,958 15,557 n.a. 76 34,243 37,281 35,787 41,057 42,076 45,280 47,353 49,719 48,947 48,259 49,664 52,648 77 Other 9,543 10,507 11,660 12,742 12,999 13,190 13,271 13,821 13,327 12,861 12,037 12,708 28 Public utilities and other 38,380 39,148 39,332 41,370 41,657 41,038 43,223 44,071 45,032 44,785 44,689 44,066 79 Public 53,346 50,977 50,798 50,925 52,251 54,786 54,539 55,216 57,490 56,200 56,612 57,494 30 Military 1,966 2,205 2,544 2,608 2,474 2,872 2,827 2,649 2,703 2,429 2,649 2,700 31 Highway 13,599 13,428 14,225 14,240 14,993 16,205 16,781 16,949 16,824 17,161 17,151 17,709 37 Conservation and development 5,300 5,029 4,822 4,319 4,608 4,531 4,518 4,356 4,492 4,537 4,558 4,923 33 Other 32,481 30,315 29,207 29,758 30,176 31,178 30,413 31,262 33,471 32,073 32,254 32,162 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 3. Value of new construction data in recent periods may not be strictly Institute and seasonally adjusted by the Census Bureau, and (b) sales and prices of comparable with data in prior periods because of changes by the Bureau of the existing units, which are published by the National Association of Realtors. All Census in its estimating techniques. For a description of these changes see back and current figures are available from originating agency. Permit authoriza- Construction Reports (C-30-76-5), issued by the Bureau in July 1976. tions are those reported to the Census Bureau from 16,000 jurisdictions beginning with 1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A50 Domestic Nonfinancial Statistics • January 1985 2.15 CONSUMER AND PRODUCER PRICES Percentage changes based on seasonally adjusted data, except as noted Change from 12 Change from 3 months earlier Change from 1 month earlier months earlier (at annual rate) IIInnndddeeexxx llleeevvveeelll IIIttteeemmm OOOcccttt... 1983 1984 1984 111999888444 11998833 11998844 (((111999666777 OOcctt.. OOcctt.. === 111000000)))111 Dec. Mar. June Sept. June July Aug. Sept. Oct. CONSUMER PRICES2 1 AU items 2.9 4.2 4.0 S.O 3.3 4.5 .2 .3 .5 .4 .4 315.3 2 Food 2.1 3.9 4.3 9.0 -.7 3.4 .1 .3 .6 -.1 .4 304.4 3 Energy items .0 .4 -1.7 -1.4 .8 1.7 -.7 -.3 .1 .6 .3 426.7 4 All items less food and energy 3.7 4.9 4.9 5.1 4.7 5.4 .3 .4 .5 .4 .3 306.1 5 Commodities 4.9 3.7 4.6 3.4 3.7 4.0 .1 .2 .4 .5 .2 256.8 6 Services 2.7 5.7 5.3 5.9 5.3 6.2 .4 .6 .5 .4 .5 362.7 PRODUCER PRICES 7 Finished goods 1.2 1.4 1.1 5.7 -.4 .4 .0 .4 -.1 -.2 -.2 291.6 8 Consumer foods 2.3 3.1 5.8 16.9 -8.5 3.3 -.4 1.4 -.1 -.4 .1 271.8 9 Consumer energy -6.1 -5.5 -10.4 -8.1 7.5 -16.7 -.2 -1.2 -2.5 -.8 1.5 745.0 10 Other consumer goods 2.2 2.1 1.5 4.5 1.3 2.5 .2 .2 .4 .0 -.5 247.2 11 Capital equipment 2.4 2.1 1.8 3.8 2.3 2.9 .1 .3 .3 .0 -.6 296.0 12 Intermediate materials3 1.4 1.8 2.5 2.9 3.3 -1.0 .5 -.1 -.1 .0 .2 325.6 13 Excluding energy 2.4 2.5 4.1 3.8 2.0 .4 .3 .0 .1 .0 .2 304.4 Crude materials 14 Foods 7.4 -3.2 12.1 12.5 -21.7 -4.9 -2.1 .5 -1.8 .0 -1.1 245.5 15 Energy -4.4 .9 -2.3 -1.6 4.0 1.0 .2 .4 .7 -.8 -.3 787.0 16 Other 12.7 -.6 2.4 -9.7 31.6 -14.0 1.2 -1.8 -3.1 1.2 -1.5 257.9 1. Not seasonally adjusted. 3. Excludes intermediate materials for food manufacturing and manufactured 2. Figures for consumer prices are those for all urban consumers and reflect a animal feeds. rental equivalence measure of homeownership after 1982. SOURCE. Bureau of Labor Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A51 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates. 1983 1984 AAccccoouunntt 11998811 11998822 11998833 Q3 Q4 QL Q2 Q3R GROSS NATIONAL PRODUCT 1 Total 2,957.8 3,069.2 3,304.8 3,346.6 3,431.7 3,553.3 3,644.7 3,695.2 By source 2 Personal consumption expenditures 1,849.1 1,984.9 2,155.9 2,181.4 2,230.2 2,276.5 2,332.7 2,360.8 3 Durable goods 235.4 245.1 279.8 284.1 299.8 310.9 320.7 318.5 4 Nondurable goods 730.7 757.5 801.7 811.7 823.0 841.3 858.3 861.1 5 Services 883.0 982.2 1,074.4 1,085.7 1,107.5 1,124.4 1,153.7 1,181.2 6 Gross private domestic investment 484.2 414.8 471.6 491.9 540.0 623.8 627.0 662.3 7 Fixed investment 458.1 441.0 485.1 496.2 527.3 550.0 576.4 593.8 8 Nonresidential 353.9 349.6 352.9 353.9 383.9 398.8 420.8 438.5 9 Structures 135.3 142.1 129.7 126.2 136.6 142.2 150.0 153.3 10 Producers' durable equipment 218.6 207.5 223.2 227.8 247.3 256.7 270.7 285.1 11 Residential structures 104.2 91.4 132.2 142.3 143.4 151.2 155.6 155.4 12 Nonfarm 99.8 86.6 127.6 137.7 138.7 146.4 150.5 150.1 13 Change in business inventories 26.0 -26.1 -13.5 -4.3 12.7 73.8 50.6 68.5 14 Nonfarm 18.2 -24.0 -3.1 11.6 14.1 60.6 47.0 59.5 I 1 S 6 Ne E t x e p x o p r o ts r ts of goods and services 3 2 69 8 . . 9 0 34 1 8 9 . . 4 0 3 - 3 8 6 . . 3 2 - 3 1 4 6 2 . . 4 0 - 3 2 4 9 6 . . 8 1 - 3 5 5 1 8 . . 5 9 - 3 5 6 8 2 . . 7 4 - 3 8 6 9 9 . . 9 3 17 Imports 341.9 329.4 344.4 358.4 375.9 410.4 421.1 459.2 18 Government purchases of goods and services 596.5 650.5 685.5 689.8 691.4 704.4 743.7 762.0 19 Federal 228.9 258.9 269.7 269.2 266.3 267.6 296.4 302.8 20 State and local 367.6 391.5 415.8 420.6 425.1 436.8 447.4 459.3 By major type of product 71 Final sales, total 2,931.7 3,095.4 33,,331188..33 33,,335500..99 33,,441199..00 33,,447799..55 33,,559944..11 33,,662266..88 77 1,294.8 1,276.7 1,355.7 1,373.1 1,423.9 1,498.0 1,544.8 1,548.1 73 Durable 530.4 499.9 555.3 576.9 607.4 632.3 647.9 655.9 74 Nondurable 764.3 776.9 800.4 796.2 816.5 865.7 896.9 892.2 ?S 1,373.0 1,510.8 1,639.3 1,654.5 1,681.3 1,713.7 1,742.6 1,782.6 26 Structures 289.9 281.7 309.8 319.0 326.5 341.6 357.2 364.6 77 Change in business inventories 26.0 -26.1 -13.5 -4.3 12.7 73.8 50.6 68.5 78 Durable goods 7.3 -18.0 -2.1 12.5 14.5 34.9 18.2 39.7 29 Nondurable goods 18.8 -8.1 -11.3 -16.8 -1.7 38.9 32.4 28.7 30 MEMO: Total GNP in 1972 dollars 1,512.2 1,480.0 1,534.7 1,550.2 1,572.7 1,610.9 1,638.8 1,646.5 NATIONAL INCOME 31 2,363.8 2,446.8 2,646.7 2,684.4 2,766.5 2,873.5 2,944.8 2,983.4 32 Compensation of employees 1,765.4 1,864.2 1,984.9 2,000.7 2,055.4 2,113.4 2,159.2 2,191.9 33 Wages and salaries 1,493.2 1,568.7 1,658.8 1,670.8 1,715.4 1,755.9 1,793.3 1,819.1 34 Government and government enterprises 284.6 306.6 328.2 330.6 335.0 342.9 347.5 352.0 35 Other 1,208.6 1,262.2 1,331.1 1,340.3 1,380.4 1,413.0 1,445.8 1,467.1 36 Supplement to wages and salaries 272.2 295.5 326.2 329.9 340.0 357.4 365.9 372.8 37 Employer contributions for social insurance 132.3 140.0 153.1 153.9 157.9 169.4 172.4 174.7 38 Other labor income 140.0 155.5 173.1 175.9 182.1 188.1 193.5 198.1 39 Proprietors' income1 125.1 111.I 121.7 123.3 131.9 154.9 149.8 154.5 40 Business and professional1 93.6 89.2 107.9 112.1 114.6 122.5 126.3 127.5 41 Farm1 31.5 21.8 13.8 11.2 17.3 32.5 23.4 27.0 42 Rental income of persons2 42.3 51.5 58.3 56.2 60.4 61.0 62.0 63.0 43 Corporate profits' 189.9 159.1 225.2 245.0 260.0 277.4 291.1 281.5 44 Profits before tax3 221.2 165.5 203.2 227.4 225.5 243.3 246.0 223.7 45 Inventory valuation adjustment -23.6 -9.5 -11.2 -19.3 -9.2 -13.5 -7.3 -.4 46 Capital consumption adjustment -7.6 3.1 33.2 36.9 43.6 47.6 52.3 58.2 47 Net interest 241.0 260.9 256.6 259.2 258.9 266.8 282.8 292.5 1. With inventory valuation and capital consumption adjustments. 3. For after-tax profits, dividends, and the like, see table 1.48. 2. With capital consumption adjustment. SOURCE. Survey of Current Business (Department of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A52 Domestic Nonfinancial Statistics • January 1985 2.17 PERSONAL INCOME AND SAVING Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted. 1983 1984 AAccccoouunntt 11998811 11998822 11998833 Q3 Q4 Ql Q2 Q3' PERSONAL INCOME AND SAVING 1 Total personal income 2,429.4 2,584.6 2,744.2 2,763.3 2,836.5 2,920.5 2,984.6 3,046.7 2 Wage and salary disbursements 1,493.1 1,568.7 1,659.2 1,671.3 1,715.4 1,755.7 1,793.1 1,819.5 3 Commodity-producing industries 509.3 509.3 519.3 523.5 539.0 555.9 567.0 573.2 4 Manufacturing 385.5 382.9 395.2 399.1 411.9 424.6 432.2 436.3 5 Distributive industries 361.6 378.6 398.6 399.7 413.2 419.2 429.5 436.5 6 Service industries 337.7 374.3 413.1 417.0 428.2 437.9 449.3 457.4 7 Government and government enterprises 284.6 306.6 328.2 331.0 335.0 342.8 347.3 352.4 8 Other labor income 140.0 155.5 173.1 175.9 182.1 188.1 193.5 198.1 9 Proprietors' income1 125.1 111.1 121.7 123.3 131.9 154.9 149.8 154.5 10 Business and professional1 93.6 89.2 107.9 112.1 114.6 122.5 126.3 127.5 11 Farm1 31.5 21.8 13.8 11.2 17.3 32.5 23.4 27.0 12 Rental income of persons2 42.3 51.5 58.3 56.2 60.4 61.0 62.0 63.0 64.3 66.5 70.3 70.7 72.8 75.0 77.2 78.5 14 Personal interest income 331.8 366.6 376.3 382.3 388.2 403.9 425.6 448.0 15 Transfer payments 337.2 376.0 405.0 403.9 408.8 411.3 415.2 418.6 16 Old-age survivors, disability, and health insurance benefits... 182.0 204.5 221.6 222.4 227.7 232.1 235.2 238.2 17 LESS: Personal contributions for social insurance 104.5 111.4 119.6 120.4 123.2 129.6 131.8 133.4 18 EQUALS: Personal income 2,429.4 2,584.6 2,744.2 2,763.3 2,836.5 2,920.5 2,984.6 3,046.7 19 LESS: Personal tax and nontax payments 387.7 404.1 404.2 395.8 407.9 418.3 430.3 440.6 20 EQUALS: Disposable personal income 2,041.7 2,180.5 2,340.1 2,367.4 2,428.6 2,502.2 2,554.3 2,606.1 21 LESS: Personal outlays 1,904.3 2,044.5 2,222.0 2,248.4 2,300.0 2,349.6 2,409.5 2,441.8 22 EQUALS: Personal saving 137.4 136.0 118.1 119.0 128.7 152.5 144.8 164.3 MEMO Per capita (1972 dollars) 23 Gross national product 6,572.8 6,369.6 6,543.4 6,601.9 6,681.4 66,,882299..44 66,,993333..22 66,,994488..88 24 Personal consumption expenditures 4,131.4 4,145.9 4,302.8 4,325.2 4,386.0 4,426.5 4,502.3 4,497.2 25 Disposable personal income 4,561.0 4,555.0 4,670.0 4,694.0 4,776.0 4,865.0 4,930.0 4,965.0 26 Saving rate (percent) 6.7 6.2 5.0 5.0 5.3 6.1 5.7 6.3 GROSS SAVING 484.3 408.8 437.2 455.2 485.7 543.9 551.0 555.5 509.9 524.0 571.7 588.6 615.0 651.3 660.2 686.7 29 Personal saving 137.4 136.0 118.1 119.0 128.7 152.5 144.8 164.3 30 Undistributed corporate profits1 42.3 29.2 76.5 86.9 100.0 107.0 115.3 115.8 31 Corporate inventory valuation adjustment -23.6 -9.5 -11.2 -19.3 -9.2 -13.5 -7.3 -.4 Capital consumption allowances 32 Corporate 202.6 221.8 231.2 233.4 236.4 223399..99 224444..11 224488..22 127.6 137.1 145.9 149.4 150.0 151.8 156.0 158.4 34 Wage accruals less disbursements .0 .0 .0 .0 .0 .0 .0 .0 35 Government surplus, or deficit (-), national income and product accounts -26.7 -115.2 -134.5 -133.5 -129.3 -107.4 --110099..22 --113311..11 -64.3 -148.2 -178.6 -180.9 -180.5 -161.3 -163.7 -176.9 37 State and local 37.6 32.9 44.1 47.4 51.2 53.9 54.5 45.8 38 Capita! grants received by the United States, net 1.1 .0 .0 .0 .0 .0 .0 .0 490.0 408.3 437.7 450.3 480.9 546.1 542.0 545.1 40 Gross private domestic 484.2 414.8 471.6 491.9 540.0 623.8 627.0 662.3 5.8 -6.6 -33.9 -41.5 -59.1 -77.7 -85.0 -117.1 5.6 -.5 .5 -4.8 -4.8 2.2 -9.0 -10.4 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

Summary Statistics A53 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data are seasonally adjusted except as noted.1 1983 1984 IItteemm ccrreeddiittss oorr ddeebbiittss 11998811 11998822 11998833 Q2 Q3 Q4 Ql Q2P 1 Balance on current account 6,294 -9,199 -41,563 -9,560 -11,846 -17,213 -19,673 -24,402 "> -8,769 -14,498 -15,964 -18,616 -24,123 3 Merchandise trade balance2 -28,001 -36,469 -61,055 -14,870 -17,501 -19,407 -25,855 -25,736 4 Merchandise exports 237,085 211,198 200,257 48,745 50,437 51,829 53,935 54,597 5 Merchandise imports -265,086 -247,667 -261,312 -63,615 -67,938 -71,236 -79,790 -80,333 6 Military transactions, net -1,116 195 515 53 -55 -273 -370 -282 7 Investment income, net3 34,053 27,802 23,508 5,978 7,172 5,119 7,748 3,662 8 Other service transactions, net 8,191 7,331 4,121 1,127 681 434 951 55 9 Remittances, pensions, and other transfers -2,382 -2,635 -2,590 -638 -665 -688 -717 -712 10 U.S. government grants (excluding military) -4,451 -5,423 -6,060 -1,210 -1,478 -2,398 -1,430 -1,389 11 Change in U.S. government assets, other than official reserve assets, net (increase, -) -5,107 -6,143 -5,013 -1,251 -1,204 -1,429 -2,037 -1,222 12 Change in U.S. official reserve assets (increase, -) -5,175 -4,965 -1,196 16 529 -953 -657 -565 13 Gold 0 0 0 0 0 0 0 0 14 Special drawing rights (SDRs) -1,823 -1,371 -66 -303 -209 545 -226 -288 15 Reserve position in International Monetary Fund -2,491 -2,552 -4,434 -212 -88 -1,996 -200 -321 16 Foreign currencies -861 -1,041 3,304 531 826 498 -231 44 17 Change in U.S. private assets abroad (increase, -)3 -100,694 -107,790 -43,281 175 -8,548 -12,461 705 -23,073 18 Bank-reported claims -84,175 -111,070 -25,391 3,894 -2,871 -8,239 1,955 -24,167 19 Nonbank-reported claims -1,181 6,626 -5,333 -230 -233 -1,671 1,659 n.a. 20 U.S. purchase of foreign securities, net -5,714 -8,102 -7,676 -3,257 -1,571 -983 637 -791 21 U.S. direct investments abroad, net3 -9,624 4,756 -4,881 -232 -3,873 -1,568 -3,546 1,885 22 Change in foreign official assets in the United States (increase, +) 5,003 3,318 5,339 1,739 -2,703 6,555 -2,784 -571 23 U.S. Treasury securities 5,019 5,728 6,989 1,985 -611 2,603 -288 -314 24 Other U.S. government obligations 1,289 -694 -487 -170 -363 417 -8 126 25 Other U.S. government liabilities4 -300 382 199 434 137 161 242 378 26 Other U.S. liabilities reported by U.S. banks -3,670 -1,747 433 316 -1,403 3,498 -2,131 216 27 Other foreign official assets5 2,665 -351 -1,795 -826 -463 -124 -599 -977 28 Change in foreign private assets in the United States (increase, +)3 76,310 91,863 76,383 10,714 22,281 27,249 18,444 36,505 29 U.S. bank-reported liabilities 42,128 65,922 49,059 1,698 14,792 22,325 8,775 21,708 30 U.S. nonbank-reported liabilities 917 -2,383 -1,318 -64 1,311 -228 4,404 n.a. 31 Foreign private purchases of U.S. Treasury securities, net 2,946 7,062 8,731 3,139 995 1,673 1,358 6,522 32 Foreign purchases of other U.S. securities, net 7,171 6,396 8,612 2,614 1,861 1,134 1,516 610 33 Foreign direct investments in the United States, net3 23,148 14,865 11,299 3,327 3,322 2,345 2,391 7,665 34 Allocation of SDRs 1,093 0 0 0 0 0 0 0 35 Discrepancy 22,275 32,916 9,331 -1,833 1,491 -1,748 6,002 13,328 36 443399 --22,,551188 22,,665577 --115544 --9911 37 Statistical discrepancy in recorded data before seasonal adjustment 22,275 32,916 9,331 -2,272 4,009 -4,405 6,156 13,419 MEMO Changes in official assets 38 U.S. official reserve assets (increase, -) -5,175 -4,965 -1,196 16 529 -953 -657 -566 39 Foreign official assets in the United States (increase, +) 5,303 2,936 5,140 1,305 -2,840 6,394 -3,026 -949 40 Change in Organization of Petroleum Exporting Countries official assets in the United States (part of line 22 above) 13,581 7,291 -8,639 -3,482 -2,051 -1,640 -2,447 -2,206 41 Transfers under military grant programs (excluded from lines 4, 6, and 10 above) 675 593 205 30 4499 8844 41 40 1. Seasonal factors are no longer calculated for lines 6, 10, 12-16, 18-20, 22-34, 4. Primarily associated with military sales contracts and other transactions and 38-41. arranged with or through foreign official agencies. 2. Data are on an international accounts (1A) basis. Differs from the Census 5. Consists of investments in U.S. corporate stocks and in debt securities of basis data, shown in table 3.11, for reasons of coverage and timing; military private corporations and state and local governments. exports are excluded from merchandise data and are included in line 6. NOTE. Data are from Bureau of Economic Analysis, Survey of Current Business 3. Includes reinvested earnings. (Department of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 International Statistics • January 1985 3.11 U.S. FOREIGN TRADE Millions of dollars; monthly data are seasonally adjusted. 1984 IItteemm 11998811 11998822 11998833 Apr. May June July Aug. Sept. Oct. 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments 233,677 212,193 200,486 17,521 17,950 17,633 19,442 18,036 18,177 18,387 2 GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded warehouses 261,305 243,952 258,048 28,368 25,569 25,356 31,883 26,567 29,430 26,313 3 Trade balance -27,628 -31,759 -57,562 -10,846 -7,619 -7,723 -12,440 -8,531 -11,253 -7,926 NOTE. The data through 1981 in this table are reported by the Bureau of Census not covered in Census statistics, and (2) the exclusion of military sales (which are data of a free-alongside-ship (f.a.s.) value basis—that is, value at the port of combined with other military transactions and reported separately in the "service export. Beginning in 1981, foreign trade of the U.S. Virgin Islands is included in account" in table 3.10, line 6). On the import side, additions are made for gold, the Census basis trade data; this adjustment has been made for all data shown in ship purchases, imports of electricity from Canada, and other transactions; the table. Beginning with 1982 data, the value of imports are on a customs military payments are excluded and shown separately as indicated above. valuation basis. SOURCE. FT900 "Summary of U.S. Export and Import Merchandise Trade" The Census basis data differ from merchandise trade data shown in table 3.10, (Department of Commerce, Bureau of the Census). U.S. International Transactions Summary, for reasons of coverage and timing. On the export side, the largest adjustments are: (1) the addition of exports to Canada 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period 1984 TTyyppee 11998811 11998822 11998833 Apr. May June July Aug. Sept. Oct. 1 Total 30,075 33,958 33,747 34,585 34,713 34,547 34,392 34,760 34,306 34,570 2 Gold stock, including Exchange Stabilization Fund1 11,151 11,148 11,121 11,107 11,104 11,100 11,099 11,098 11,097 11,096 3 Special drawing rights2 3 4,095 5,250 5,025 5,266 5,513 5,459 5,453 5,652 5,554 5,539 4 Reserve position in International Monetary Fund2 5,055 7,348 11,312 11.618 11,666 11,659 11,735 11,820 11,619 11,618 5 Foreign currencies4 9,774 10,212 6,289 6,594 6,430 6,329 6,105 6,190 6,036 6,317 1. Gold held under earmark at Federal Reserve Banks for foreign and interna- 3. Includes allocations by the International Monetary Fund of SDRs as follows: tional 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. 1, 3.13. Gold stock is valued at $42.22 per fine troy ounce. 1972; $1,139 million on Jan. 1, 1979; $1,152 million on Jan. 1, 1980; and $1,093 2. Beginning July 1974, the IMF adopted a technique for valuing the SDR based million on Jan. 1, 1981; plus transactions in SDRs. on a weighted average of exchange rates for the currencies of member countries. 4. Valued at current market exchange rates. From July 1974 through December 1980, 16 currencies were used; from January 1981, 5 currencies have been used. The U.S. SDR holdings and reserve position in the IMF also are valued on this basis beginning July 1974. 3.13 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS Millions of dollars, end of period 1984 AAsssseettss 11998811 11998822 11998833 Apr. May June July Aug. Sept. Oct. 1 Deposits 505 328 190 345 295 238 215 242 206 270 Assets held in custody 2 U.S. Treasury securities' 104,680 112,544 117,670 117,808 114,562 117,143 115,760 117,130 115,678 115,542 3 Earmarked gold2 14,804 14,716 14,414 14,278 14,268 14,266 14,270 14,258 14,256 14,260 1. Marketable U.S. Treasury bills, notes, and bonds; and nonmarketable U.S. NOTE. Excludes deposits and U.S. Treasury securities held for international Treasury securities payable in dollars and in foreign currencies. and regional organizations. Earmarked gold is gold held for foreign and interna- 2. Earmarked gold is valued at $42.22 per fine troy ounce. tional accounts and is not included in the gold stock of the United States. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Summary Statistics A55 3.14 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data Millions of dollars, end of period Asset account Mar. Apr. May July Aug. All foreign countries 1 Total, all currencies 462,847 469,712 476,539 481,418 474,882 485,739 477,35y 465,713' 461,320 453,163 2 Claims on United States 63,743 91,805 115,065 122,021 121,081 126,100 124,936' 118,344 116,813 113,882 3 Parent bank 43,267 61,666 81,113 86,379 85,150 89,031 89,473' 82,293' 81,984 79,620 4 5 O N t o h n e b r a b n a k n s1 k s in United States1 | 20,476 30,139 33,952 35,642 35,931 37,069 2 1 0 4 , , 9 5 4 1 7 6 2 1 1 4 , , 5 5 1 3 5 6 ' ' 2 1 1 3 , , 2 5 8 4 5 4 2 1 0 3 , , 8 3 7 8 5 7 6 Claims on foreigners 378,954 358,493 342,609 339,289 333,701 339,029 332,363' 327,209' 323,539 317,613 7 Other branches of parent bank 87,821 91,168 92,718 91,259 92,842 95,095 95,891' 91,247' 93,449 92,619 8 Banks 150,763 133,752 117,593 114,761 107,540 112,626 105,552' 107,306' 102,611 100,662 9 Public borrowers 28,197 24,131 24,508 24,777 24,775 24,345 23,381 23,436 22,736 22,498 10 Nonbank foreigners 112,173 109,442 107,790 109,048 108,544 106,965 107,539' 105,220' 104,743 101,834 11 Other assets 20,150 19,414 18,865 20,108 20,100 20,610 20,054' 20,160' 20,968 21,668 12 Total payable in U.S. dollars 350,735 361,982 370,958 365,380 359,385 372,452 367,501' 357,384' 351,776 345,944 13 Claims on United States 62,142 90,085 112,959 119,644 118,602 123,725 122,741' 115,999 114,497 111,354 14 Parent bank 42,721 61,010 80,018 85,067 83,729 87,851 88,361' 81,055' 80,838 78,375 1 1 1 1 1 7 5 6 8 9 Cla B N O O i a m t o t h h n n s e e k b r r s o a n b b n r a k f a n s o n k 1 r c s e h i i g e n s n e U o r f n s i p te a d re n S t t a b t a e n s' k j 2 1 6 1 7 2 9 9 6 2 , , , , 4 3 9 1 2 3 9 1 1 7 8 0 2 1 5 2 7 0 9 9 3 6 , , , , 8 0 5 4 7 7 3 4 1 5 7 7 2 9 4 3 7 3 7 2 5 , , , , 3 2 9 2 2 5 4 0 7 7 1 7 2 7 8 3 3 8 5 1 4 , , , , 3 7 4 5 2 7 7 9 5 8 7 6 23 3 7 83 0 4 0 , , , , 1 3 8 1 9 8 7 0 4 6 3 0 2 7 8 3 3 6 5 7 5 , , , , 5 5 8 8 6 7 0 6 7 4 3 0 2 2 7 8 3 1 0 7 1 4 4 , , , , , 1 4 1 1 2 0 7 4 7 6 6 4 1 4 0 ' ' ' 2 2 7 8 3 1 0 3 2 0 4 , , , , , 7 5 3 7 2 4 1 1 0 0 2 8 0 2 2 ' ' ' ' ' 2 2 7 7 2 1 5 0 6 6 3 , , , , , 9 4 6 2 2 0 5 4 1 0 8 6 6 6 3 22 7 7 1 1 3 5 5 9 3 , , , , , 1 4 6 9 0 5 8 5 7 0 2 2 2 3 6 20 Public borrowers 22,877 18,413 17,881 18,106 17,957 17,613 17,007 17,149 16,876 16,858 21 Nonbank foreigners 62,552 61,474 60,982 58,407 59,135 58,177 58,538' 57,725' 56,786 55,160 22 Other assets 11,656 12,026 10,672 9,958 10,397 10,867 10,600 10,683' 11,063 11,438 United Kingdom 23 Total, all currencies 157,229 161,067 158,732 161,007 161,109 159,059 158,724 155,625 154,045 146,784 24 Claims on United States 11,823 27,354 34,433 38,072 38,428 36,148 36,309 33,679 31,675 29,313 25 Parent bank 7,885 23,017 29,111 32,201 32,855 30,266 30,621 27,845' 26,054 23,772 2 2 2 6 7 8 Cl O a N i t m o h n s e b r o a b n n a k f n s o k 1 r s e i i g n n U er n s ited States' \ 13 3 8 , , 9 8 3 8 8 8 12 4 7 , , 3 7 3 3 7 4 11 5 9 , , 3 2 2 8 2 0 11 5 8 , , 8 2 7 0 1 0 11 5 7 , , 5 7 7 1 3 3 11 5 7 , , 8 8 8 0 2 8 11 4 1 7 , , , 4 2 2 6 2 1 5 3 2 11 4 1 6 , , , 5 2 7 7 6 4 3 0 1 ' 11 4 1 7 , , , 5 0 0 5 7 6 1 0 6 11 4 1 2 , , , 2 3 4 3 0 0 4 7 7 29 Other branches of parent bank 41,367 37,000 36,565 34,617 38,571 36,804 38,518 37,728 39,270 36,797 30 Banks 56,315 50,767 43,352 43,804 39,779 42,084 39,892 40,980 39,760 38,947 31 Public borrowers 7,490 6,240 5,898 6,076 6,072 5,992 5,876 5,786 5,510 5,330 32 Nonbank foreigners 33,716 33,727 33,465 33,703 33,291 32,928 32,926 32,246 32,526 31,333 33 Other assets 6,518 5,979 5,019 4,735 4,968 5,103 5,203 5,206 5,304 5,064 34 Total payable in U.S. dollars 115,188 123,740 126,012 124,501 123,174 122,215 123,628 120,470 118,141 113,432 35 Claims on United States 11,246 26,761 33,756 37,282 37,598 35,210 35,358 32,569 30,633 28,274 36 Parent bank 7,721 22,756 28,756 31,789 32,453 29,876 30,181 27,221' 25,509 23,323 4 3 3 3 0 7 8 9 Cl O a N O i t m t o h h n s e e b r r o a b n b n r a k a f n s o n k 1 r c s e h i i e g n s n e U o r f n s i p te a d re n S t t a b t a e n s k ' ) 9 3 9 5 3 , , , 8 4 5 5 3 2 0 9 5 9 3 4 2 1 , , , 0 2 6 0 2 4 5 8 8 3 8 5 1 8 , , , 0 8 9 0 3 1 0 8 7 2 8 8 5 4 , , , 7 4 5 2 9 9 3 3 9 2 8 9 2 5 , , , 2 1 7 4 4 6 5 7 9 8 30 3 5, , , 3 2 9 3 7 2 4 8 5 8 3 4 2 5 1 , , , , 0 7 1 1 6 6 1 7 2 5 5 6 8 3 4 1 4 1 , , , , 7 7 1 1 6 4 2 9 2 9 9 9 ' 8 3 4 4 3 , , , 1 3 5 9 8 6 8 4 2 5 0 2 8 3 3 2 2 1 , , , , 7 1 0 1 6 6 0 8 4 4 4 7 41 Banks 40,703 36,717 32,188 31,613 29,135 30,036 28,610 29,444 27,816 27,801 42 Public borrowers 5,595 4,329 4,194 4,390 4,408 4,2% 4,284 4,288 3,983 3,850 43 Nonbank foreigners 18,113 19,534 20,697 19,873 19,979 19,315 19,517 19,235 18,986 18,509 44 Other assets 4,092 4,751 3,339 2,620 2,807 3,080 3,094 3,172 3,143 2,994 Bahamas and Caymans 45 Total, all currencies 149,108 145,156 151,532 149,953 145,281 156,656 153,836 147,730 147,060 144,590 46 Claims on United States 46,546 59,403 74,832 78,015 75,690 83,620 81,635 78,064 78,623 76,486 47 Parent bank 31,643 34,653 47,807 50,146 47,566 54,122 53,650 49,673 51,125 49,556 4 4 8 9 O N t o h n e b r a b n a k n s k 1 s in United States' \ 14,903 24,750 27,025 27,869 28,124 29,498 1 1 2 5 , , 3 6 8 0 0 5 1 1 2 6 , , 3 0 5 3 8 3 ' ' 1 1 1 5 , , 5 9 4 5 0 8 1 1 1 5 , , 2 7 1 1 5 5 50 Claims on foreigners 98,057 81,450 72,788 67,985 65,666 68,960 68,325 65,620 64,263 64,072 51 Other branches of parent bank 12,951 18,720 17,340 15,821 14,811 16,931 18,057 15,434 16,079 16,314 52 Banks 55,151 42,699 36,767 34,856 32,723 33,755 31,827 32,140 30,519 29,939 53 Public borrowers 10,010 6,413 6,084 6,030 6,005 5,922 5,993 6,000 5,978 6,119 54 Nonbank foreigners 19,945 13,618 12,597 11,834 12,127 12,352 12,448 12,046 11,687 11,700 55 Other assets 4,505 4,303 3,912 3,953 3,925 4,076 3,876 4,046 4,174 4,032 56 Total payable in U.S. dollars 143,743 139,605 145,091 143,466 138,881 150,191 147,681 141,770 140,882 138,705 1. Data for assets vis-a-vis other banks in the United States and vis-a-vis nonbanks are combined for dates prior to June 1984. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A56 International Statistics • January 1985 3.14 Continued 1984 y coum 11998811 11998822 11998833 Mar. Apr. May June July Aug. Sept.'' All foreign countries 57 Total, all currencies 462,847 469,712 476,539 481,418 474,882 485,739 477,353 465,713' 461,320' 453,163 58 Negotiable CDs2 n.a. n.a. n.a. n.a. n.a. n.a. 43,337 41,311 41,556 39,756 59 To United States 137,767 179,015 187,602 188,214 184,451 191,072 162,427' 155,307' 152,381 147,577 60 Parent bank 56,344 75,621 80,537 77,651 75,594 80,353 80,710' 77,987' 76,899 74,971 61 Other banks in United States 19,197 33,405 29,107 29,037 27,151 27,845 22,827' 22,055 19,693 20,080 62 Nonbanks 62,226 69,989 77,958 81,526 81,706 82,874 58,890' 55,265 55,789 52,526 63 To foreigners 305,630 270,853 269,602 273,159 270,242 274,840 252,007' 248,513' 246,066 243,915 64 Other branches of parent bank 86,396 90,191 89,055 87,229 90,937 92,254 92,112' 88,815' 90,626 89,993 65 Banks 124,906 96,860 92,882 95,690 90,166 94,041 83,094' 80,129' 78,446 77,015 66 Official institutions 25,997 19,614 18,893 18,250 17,882 19,608 19,694' 21,219 20,228 21,551 67 Nonbank foreigners 68,331 64,188 68,772 71,982 71,257 68,937 57,107' 58,350' 56,766 55,356 68 Other liabilities 19,450 19,844 19,335 20,045 20,189 19,827 19,582' 20,582' 21,317 21,915 69 Total payable in U.S. dollars 364,447 379,270 387,740 382,765 375,443 390,534 384,824' 374,579' 369,325 362,193 70 Negotiable CDs2 n.a. n.a. n.a. n.a. n.a. n.a. 40,768 39,004 39,510 37,519 71 To United States 134,700 175,528 183,837 183,926 180,149 186,793 157,877' 150,842 147,869 143,084 72 Parent bank 54,492 73,295 78,328 75,068 73,168 77,894 78,017' 75,270 74,413 72,218 73 Other banks in United States 18,883 33,040 28,573 28,451 26,564 27,192 22,233' 21,422 19,019 19,405 74 Nonbanks 61,325 69,193 76,936 80,407 80,417 81,707 57,627' 54,150 54,537 51,461 75 To foreigners 217,602 192,510 194,056 189,612 185,165 193,763 176,273' 174,378' 171,691 170,976 76 Other branches of parent bank 69,299 72,921 72,002 68,557 69,096 73,380 74,177' 71,237 73,330 71,785 77 Banks 79,594 57,463 57,015 56,202 50,874 54,932 46,998' 44,856' 42,337 42,632 78 Official institutions 20,288 15,055 13,852 13,161 13,347 14,835 14,281' 16,099 15,477 16,850 79 Nonbank foreigners 48,421 47,071 51,187 51,692 51,848 50,616 40,817 42,096 40,547 39,709 80 Other liabilities 12,145 11,232 9,847 9,227 10,129 9,978 9,906' 10,355' 10,255 10,614 United Kingdom 81 Total, all currencies 157,229 161,067 158,732 161,007 161,109 159,059 158,724 155,625 154,045 146,784 82 Negotiable CDs2 n.a. n.a. n.a. n.a. n.a. n.a. 39,740 37,998' 38,172 36,499 83 To United States 38,022 53,954 55,799 56,228 56,526 55,353 31,948 29,664 29,667 27,247 84 Parent bank 5,444 13,091 14,021 15,850 16,311 17,820 18,532 16,712 18,127 16,122 85 Other banks in United States 7,502 12,205 11,328 11,440 10,542 9,487 4,701 4,277 3,548 3,422 86 Nonbanks 25,076 28,658 30,450 28,938 29,673 28,046 8,715 8,675 7,992 7,703 87 To foreigners 112,255 99,567 95,847 97,109 97,064 96,339 79,589 80,261 78,357 75,128 88 Other branches of parent bank 16,545 18,361 19,038 21,477 21,939 20,617 21,130' 21,459 22,178 21,096 89 Banks 51,336 44,020 41,624 42,073 40,751 41,597 32,917' 31,435 30,725 28,932 90 Official institutions 16,517 11,504 10,151 8,833 9,403 10,377 10,104' 11,301 10,480 10,625 91 Nonbank foreigners 27,857 25,682 25,034 24,726 24,971 23,748 15,438 16,066 14,974 14,475 92 Other liabilities 6,952 7,546 7,086 7,670 7,519 7,367 7,447 7,702 7,849 7,910 93 Total payable in U.S. dollars 120,277 130,261 131,167 130,985 128,369 128,255 128,612 126,276 124,064 117,264 94 Negotiable CDs2 n.a. n.a. n.a. n.a. n.£|. n.a. 38,363 36,757 37,126 35,297 95 To United States 37,332 53,029 54,691 55,031 55,201 54,094 30,602 28,331 28,027 25,737 % Parent bank 5,350 12,814 13,839 15,606 16.127 17,624 18,244 16,372 17,701 15,678 97 Other banks in United States 7,249 12,026 11,044 11,204 10,292 9,200 4,486 4,018 3,244 3,102 98 Nonbanks 24,733 28,189 29,808 28,221 28,782 27,270 7,872 7,941 7,082 6,957 99 To foreigners 79,034 73,477 73,279 72,892 69,739 70,764 56,064 57,495 55,234 52,649 100 Other branches of parent bank 12,048 14,300 15,403 17,559 14,801 15,733 17,646 17,472 18,312 16,541 101 Banks 32,298 28,810 29,320 28,833 27,286 27,308 19,574 18,197 16,980 15,971 102 Official institutions 13,612 9,668 8,279 6,910 7,650 8,760 7,639 9,610 8,920 9,375 103 Nonbank foreigners 21,076 20,699 20,277 19,590 20,002 18,963 11,205 12,216 11,022 10,762 104 Other liabilities 3,911 3,755 3,197 3,062 3,429 3,397 3,583 3,693 3,677 3,581 Bahamas and Caymans 105 Total, all currencies 149,108 145,156 151,532 149,953 145,281 156,656 153,836 147,730 147,060 144,590 106 Negotiable CDs2 n.a. n.a. n.a. n.a. n.a. n.a. 1,081 979 898 779 10/ To United States 85,759 104,425 110,831 110,753 107,432 114,747 110,896 106,225 103,663 100,693 108 Parent bank 39,451 47,081 50,256 45,571 43,523 46,313 45,734 44,827 42,114 42,077 109 Other banks in United States 10,474 18,466 15,711 15,979 15,208 16,924 16,642 16,188 14,742 15,388 110 Nonbanks 35,834 38,878 44,864 49,203 48,701 51,510 48,520 45,210 46,807 43,228 111 To foreigners 60,012 38,274 38,362 36,836 35,502 39,390 39,277 37,744 39,598 40,223 112 Other branches of parent bank 20,641 15,796 13,376 11,987 12,858 14,031 13,771 12,274 14,403 15,290 113 Banks 23,202 10,166 11,869 11,405 9,859 12,106 12,497 12,633' 12,198 11,966 114 Official institutions 3,498 1,967 1,916 2,395 1,869 2,197 2,662 2,408 2,674 3,028 115 Nonbank foreigners 12,671 10,345 11,201 11,049 10,916 11,056 10,347 10,429' 10,323 9,939 116 Other liabilities 3,337 2,457 2,339 2,364 2,347 2,519 2,582 2,782 2,901 2,895 117 Total payable in U.S. dollars 145,284 141,908 147,727 145,917 141,040 152,515 149,760 143,779 143,056 140,935 2. Before June 1984, liabilities on negotiable CDs were included in liabilities to the United States or liabilities to foreigners, according to the address of the initial purchaser. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Summary Statistics A57 3.15 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1984 IItteemm 11998822 11998833 Mar/ Apr/ May' June' July' Aug. Sept.? 1 Total1 172,718 177,951R 174,927 175,327 172,018 174,133 174,326 177,111 173,356 By type 2 Liabilities reported by banks in the United States2 24,989 25,534' 23,388 23,836 23,204 23,737 25,653 26,166 23,938 3 U.S. Treasury bills and certificates3 46,658 54,341 53,681 53,171 51,035 53,977 51,974 54,022 54,627 U.S. Treasury bonds and notes 4 Marketable 67,733 68,514 69,554 70,176 69,818 68,947 69,125 70,491 68,520 5 Nonmarketable4 8,750 7,250 6,600 6,600 6,600 6,600 6,600 5,800 5,800 6 U.S. securities other than U.S. Treasury securities5 24,588 22,305' 21,704 21,544 21,361 20,872 20,974 20,632 20,471 By area 1 Western Europe1 61,298 67,645 67,717 69,926 69,971 70,168 68,524 70,242 68,035 8 Canada 2,070 2,438 1,944 1,557 1,247 994 1,250 1,434 1,069 9 Latin America and Caribbean 6,057 6,248 6,462 7,461 6,472 7,070 7,118 8,170 7,053 10 Asia 96,034 92,572' 90,627 88,534 86,521 88,427 90,321 90,459 90,407 11 Africa 1,350 958 1,039 941 1,179 996 970 838 896 12 Other countries6 5,909 8,090^ 7,138 6,908 6,628 6,478 6,143 5,968 5,896 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, commer- agencies, and U.S. corporate stocks and bonds. cial paper, negotiable time certificates of deposit, and borrowings under repur- 6. Includes countries in Oceania and Eastern Europe. chase agreements. NOTE. Based on Treasury Department data and on data reported to the 3. Includes nonmarketable certificates of indebtedness (including those pay- Treasury Department by banks (including Federal Reserve Banks) and securities able in foreign currencies through 1974) and Treasury bills issued to official dealers in the United States. institutions of foreign countries. 4. Excludes notes issued to foreign official nonreserve agencies. Includes bonds and notes payable in foreign currencies. 3.16 LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in Foreign Currencies Millions of dollars, end of period 1983 1984 IItteemm 11998800 11998811 11998822 Dec. Mar/ June Sept.'' 1 Banks' own liabilities 3,748 3,523 4,844 5,219' 5,672 6,402 5,901 2 Banks' own claims 4,206 4,980 7,707 7,231 9,034 9,623 9,048 3 Deposits 2,507 3,398 4,251 2,731 4,024 4,280 3,738 4 Other claims 1,699 1,582 3,456 4,501 5,010 5,344 5,310 5 Claims of banks' domestic customers1 962 971 676 1,059 361 227 281 1. Assets owned by customers of the reporting bank located in the United NOTE. Data on claims exclude foreign currencies held by U.S. monetary States that represent claims on foreigners held by reporting banks for the accounts authorities, of their domestic customers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 International Statistics • January 1985 3.17 LIABILITIES TO FOREIGNERS Reported by Banks in the United States Payable in U.S. dollars Millions of dollars, end of period 1984 HHoollddeerr aanndd ttyyppee ooff lliiaabbiilliittyy 11998811AA 11998822 11998833 Mar.' Apr. May June July' Aug. Sept.? 1 All foreigners 243,889 307,056 369,584' 377,558 380,158' 393,754' 400,492 396,376 394,362 395,460 2 Banks' own liabilities 163,817 227,089 278,002' 285,311 286,954' 301,352' 303,779 300,731 294,570 296,594 3 Demand deposits 19,631 15,889 17,485' 17,406 17,176' 17,196' 17,621 16,384 16,239 17,246 4 Time deposits' 29,039 68,797' 90,597' 97,283 %,876' 103,390' 105,347 109,392 107,450 111,265 5 Other2 17,647 23,184' 25,815' 23,721 24,084' 23,722' 23,100 25,546 23,503 22,915 6 Own foreign offices3 97,500 119,219 145,105' 146,901 148,817' 157,044' 157,711 149,409 147,378 145,168 7 Banks' custody liabilities4 80,072 79,961 90,582 92,247 93,205 92,402 96,713 95,646 99,792 98,866 8 U.S. Treasury bills and certificates5 55,315 55,628 68,669 69,666 69,893 68,511 72,191 71,244 74,148 73,160 9 Other negotiable and readily transferable instruments6 18,788 20,636 17,529 18,075 18,703 18,780 19,518 19,411 20,517 20,833 10 Other 5,970 3,702 4,385 4,506 4,608 5,112 5,003 4,990 5,127 4,873 11 Nonmonetary international and regional organizations7 2,721 4,922 5,957 6,243 6,356 5,316 5,055 5,344 5,748 6,285 12 Banks' own liabilities 638 1,909 4,632 4,047 3,528 2,229 2,920 2,612 1,960 3,310 13 Demand deposits 262 106 297 414 194 255 182 142 325 208 14 Time deposits' 58 1,664 3,584 2,656 2,468 1,640 2,209 2,213 1,446 2,533 15 Other2 318 139 750 977 866 335 529 257 189 570 16 Banks' custody liabilities4 2,083 3,013 1,325 2,1% 2,827 3,087 2,135 2,732 3,788 2,975 17 U.S. Treasury bills and certificates 541 1,621 463 1,224 1,759 2,057 887 1,709 2,722 1,834 18 Other negotiable and readily transferable instruments6 1,542 1,392 862 971 1,068 1,030 1,248 1,023 1,067 1,140 19 Other 0 0 0 0 0 0 0 0 0 0 20 Official institutions8 79,126 71,647 79,876' 77,068 77,007' 74,240' 77,714 77,627 80,188 78,565 21 Banks' own liabilities 17,109 16,640 19,427' 17,120 17,534' 16,859' 16,616 18,379 18,068 16,174 22 Demand deposits 2,564 1,899 1,837 1,938 1,761 1,729' 1,898 1,875 2,001 2,002 23 Time deposits' 4,230 5,528 7,318' 6,727 7,483' 7,263' 7,548 7,958 7,905 7,799 24 Other2 10,315 9,212 10,272' 8,455 8,290' 7,868' 7,169 8,546 8,162 6,374 25 Banks' custody liabilities4 62,018 55,008 60,448 59,948 59,473 57,380 61,098 59,248 62,120 62,391 26 U.S. Treasury bills and certificates5 52,389 46,658 54,341 53,681 53,171 51,035 53,977 51,974 54,022 54,627 27 Other negotiable and readily transferable instruments6 9,581 8,321 6,082 6,249 6,287 6,307 7,030 7,265 8,088 7,746 28 Other 47 28 25 19 15 38 91 9 10 18 29 Banks9 136,008 185,881 226,810' 233,699 234,524' 249,204' 251,783 247,716 241,879 243,022 30 Banks' own liabilities 124,312 169,449 205,270' 211,318 212,051' 226,054' 227,195 222,401 216,408 218,131 31 Unaffiliated foreign banks 26,812 50,230 60,165' 64,417 63,234' 69,01c 69,484 72,993 69,030 72,%3 32 Demand deposits 11,614 8,675 8,773' 8,277 8,797' 8,879 9,074 8,203 7,906 8,460 33 Time deposits' 8,720 28,386 37,412' 42,611 40,211' 45,287' 45,699 48,719 46,998 49,201 34 Other2 6,477 13,169 13,979' 13,529 14,225' 14,845 14,711 16,070 14,125 15,301 35 Own foreign offices3 97,500 119,219 145,105' 146,901 148,817' 157,044' 157,711 149,409 147,378 145,168 36 Banks' custody liabilities4 11,696 16,432 21,540 22,381 22,473 23,150 24,588 25,315 25,471 24,892 37 U.S. Treasury bills and certificates 1,685 5,809 10,178 10,760 10,795 11,182 12,771 13,022 12,766 12,234 38 Other negotiable and readily transferable instruments6 4,400 7,857 7,485 7,444 7,586 7,523 7,446 7,867 8,172 8,421 39 Other 5,611 2,766 3,877 4,177 4,092 4,445 4,371 4,426 4,534 4,236 40 Other foreigners 26,035 44,606 56,942' 60,549 62,272' 64,994' 65,940 65,689 66,546 67,587 41 Banks' own liabilities 21,759 39,092 49,672' 52,827 53,84C 56,209' 57,048 57,338 58,135 58,979 42 Demand deposits 5,191 5,209 6,577' 6,778 6,423' 6,333 6,466 6,163 6,007 6,576 43 Time deposits 16,030 33,219' 42,283' 45,288 46,714' 49,201' 49,891 50,502 51,100 51,732 44 Other2 537 664' 813 761 703 675 691 672 1,027 671 45 Banks' custody liabilities4 4,276 5,514 7,269 7,722 8,431 8,785 8,892 8,351 8,412 8,609 46 U.S. Treasury bills and certificates 699 1,540 3,686 4,001 4,168 4,238 4,556 4,540 4,639 4,465 47 Other negotiable and readily transferable instruments6 3,265 3,065 3,100 3,411 3,763 3,919 3,795 3,255 3,191 3,525 48 Other 312 908 483 311 501 628 541 556 582 619 49 MEMO: Negotiable time certificates of deposit in custody for foreigners 10,747 14,307 10,407 9,688 10,128 10,630 10,986 10,930 11,415 10,512 • Liabilities and claims of banks in the United States were increased, 4. Financial claims on residents of the United States, other than long-term beginning in December 1981, by the shift from foreign branches to international securities, held by or through reporting banks. banking facilities in the United States of liabilities to, and claims on, foreign 5. Includes nonmarketable certificates of indebtedness and Treasury bills residents. issued to official institutions of foreign countries. 1. Excludes negotiable time certificates of deposit, which are included in 6. Principally bankers acceptances, commercial paper, and negotiable time "Other negotiable and readily transferable instruments." certificates of deposit. 2. Includes borrowing under repurchase agreements. 7. Principally the International Bank for Reconstruction and Development, and 3. U.S. banks: includes amounts due to own foreign branches and foreign the Inter-American and Asian Development Banks. subsidiaries consolidated in "Consolidated Report of Condition" filed with bank 8. Foreign central banks and foreign central governments, and the Bank for regulatory agencies. Agencies, branches, and majority-owned subsidiaries of International Settlements. foreign banks: principally amounts due to head office or parent foreign bank, and 9. Excludes central banks, which are included in "Official institutions." foreign branches, agencies or wholly owned subsidiaries of head office or parent foreign bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A59 3.17 Continued 1984 AArreeaa aanndd ccoouunnttrryy 11998811AA 11998822 11998833 Mar. Apr. May June July Aug. Sept.f 1 Totol 243,889 307,056 369,584r 377,558' 380,158' 393,754' 400,492 396,376' 394,362 395,460 2 Foreign countries 241,168 302,134 363,627' 371,316' 373,803' 388,438' 395,437 391,033' 388,614 389,175 3 Europe 91,275 117,756 138,045 142,499' 147,775' 151,532 156,041 152,529' 150,626 146,955 4 Austria 596 519 585 861 883 867 770 720 758 694 5 Belgium-Luxembourg 4,117 2,517 2,709 3,377' 3,585 4,680 5,138 4,775 4,783 4,278 6 Denmark 333 509 466 285 307 378 291 429 408 341 7 Finland 296 748 531 287 485 405 1,248 947 489 638 8 France 8,486 8,171 9,441 10,733' 10,735' 12,119 11,670 12,031' 11,501 11,548 9 Germany 7,645 5,351 3,599 4,878 5,205 3,990 3,663 3,961' 3,753 3,030 10 Greece 463 537 520 503 528 594 596 600 566 568 11 Italy 7,267 5,626 8,462 7,395 7,813 8,315 8,155 6,960 8,374 9,785 12 Netherlands 2,823 3,362 4,290 4,451' 5,043' 5,030 5,735 5,615' 5,116 3,813 13 Norway 1,457 1,567 1,673 1,285 1,847 1,536 2,084 1,624 2,026 1,817 14 Portugal 354 388 373 403 414 401 425 440 539 434 15 Spain 916 1,405 1,603 1,749 1,707 1,663 1,774 1,825 1,952 1,984 16 Sweden 1,545 1,390 1,799 1,838 1,673 1,962 1,486 1,833 2,114 2,008 17 Switzerland 18,716 29,066 32,219 32,237 32,769' 32,704' 35,137 33,311' 32,871 33,020 18 Turkey 518 296 467 318 335 444 315 340 354 319 19 United Kingdom 28,286 48,172 60,683 65,031' 67,841' 69,006 69,885 69,767' 67,960 65,306 20 Yugoslavia 375 499 562 479 448 511 556 525 435 514 21 Other Western Europe1 6,541 7,006 7,403 5,748' 5,584 6,389' 6,459 6,349 6,045 6,071 22 U.S.S.R 49 50 65 177 61 53 41 31 47 42 23 Other Eastern Europe2 493 576 596 464 510 484 612 447' 538 744 24 Canada 10,250 12,232 16,026 17,185' 16,707 17,455 17,572 19,221' 18,267 17,288 25 Latin America and Caribbean 85,223 114,163 140,174' 143,466' 144,076' 152,187' 151,684 148,023' 149,066 149,801 26 Argentina 2,445 3,578 4,038' 4,404' 4,657' 4,583 4,535 4,439' 4,410 4,378 27 Bahamas 34,856 44,744 55,842' 58,226' 57,000' 62,634' 61,141 58,414' 58,176 56,383 28 Bermuda 765 1,572 2,328 2,901' 3,111' 3,276 2,598 2,544 2,743 3,177 29 Brazil 1,568 2,014 3,168' 3,734' 3,808' 3,568 3,690 4,120 4,697 4,428 30 British West Indies 17,794 26,381 34,545 32,70c 32,974' 33,847' 34,678 33,953 33,869 35,587 31 Chile 664 1,626 1,842 1,878' 1,972 1,887 1,970 2,176 2,060 1,873 32 Colombia 2,993 2,594 1,689 1,669 1,814 1,767 1,809 1,801 1,791 1,959 33 Cuba 9 9 8 8 8 10 9 7 7 8 34 Ecuador 434 455 1,047 821' 969' 881' 908 845 951 931 35 Guatemala 479 670 788 815 850 842 825 811 831 815 36 Jamaica 87 126 109 132 127' 126' 157 116 126 186 37 Mexico 7,235 8,377 10,392 10,720' 11,21 CK 11,874 11,976 11,722' 12,179 12,870 38 Netherlands Antilles 3,182 3,597 3,879 4,904' 4,681' 4,666 4,459 4,253' 4,252 4,179 39 Panama 4,857 4,805 5,924 5,478' 5,472' 6,283' 6,652 6,664 6,499 6,811 40 Peru 694 1,147 1,166 1,154' 1,182' 1,249 1,279 1,278 1,273 1,343 41 Uruguay 367 759 1,244' 1,425' 1,343' 1,380 1,309 1,302 1,318 1,418 42 Venezuela 4,245 8,417 8,632' 8,582' 9,081' 9,432' 10,129 9,684 10,046 9,615 43 Other Latin America and Caribbean 2,548 3,291 3,535' 3,915' 3,817' 3,882' 3,559 3,895' 3,838 3,842 44 Asia 49,822 48,716 58,488' 57,740' 55,039' 57,199' 60,201 61,726' 61,478 66,056 China 45 Mainland 158 203 249 272 302 400 469 644 671 875 46 Taiwan 2,082 2,761 3,997 4,193 4,388 4,364 4,578 4,797' 4,799 4,970 47 Hong Kong 3,950 4,465 6,657' 6,429' 5,501' 5,862 6,416 6,117' 6,107 6,948 48 India 385 433 464 687 651 646 498 621 800 643 49 Indonesia 640 857 997 743' 784 897 1,281 911 1,137 939 50 Israel 592 606 1,722 836' 716' 754 768 804 726 750 51 Japan 20,750 16,078 18,079 19,226' 18,862 20,522 19,433 19,442 19,686 21,338 52 Korea 2,013 1,692 1,648 1,748 1,414' 1,337 1,276 1,393' 1,703 1,577 53 Philippines 874 770 1,234 1,266' 1,015 1,130 1,032 976 1,084 1,020 54 Thailand 534 629 747 714 636 730 875 779 782 742 55 Middle-East oil-exporting countries3 12,992 13,433 12,970 12,197 12,269 11,615 12,341 14,748 13,187 13,691 56 Other Asia 4,853 6,789 9,725' 9,428' 8,501' 8,943' 11,234 10,496 10,796 12,563 57 Africa 3,180 3,124 2,827' 3,111 3,182 3,140 3,331 3,145 3,027 3.019 58 Egypt 360 432 671' 561 649 698 893 858' 743 631 59 Morocco 32 81 84 122 127 132 133 128 119 162 60 South Africa 420 292 449 538 264 329 420 409 350 318 61 Zaire 26 23 87 77 119 124 136 99 101 148 62 Oil-exporting countries4 1,395 1,280 620 893 1,046 895 816 706 750 795 63 Other Africa 946 1,016 917 920 978 962 932 946 964 964 64 Other countries 1,419 6,143 8,067' 7,315 7,023 6,925 6,609 6,389 6,150 6,055 65 Australia 1,223 5,904 7,857 7,095 6,803 6,685 6,316 6,095 5,749 5,687 66 All other 196 239 210' 220 220 240 293 294 401 368 67 Nonmonetary international and regional organizations 2,721 4,922 5,957 6,243 6,356 5,316 5,055 5,344 5,748 6,285 68 International 1,661 4,049 5,273 5,426 5,641 4,741 4,436 4,740' 4,973 5,409 69 Latin American regional 710 517 419 451 419 428 438 431 445 488 70 Other regional5 350 357 265 366 296 146 180 173 330 388 A Liabilities and claims of banks in the United States were increased, beginning 3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and in December 1981, by the shift from foreign branches to international banking United Arab Emirates (Trucial States). facilities in the United States of liabilities to, and claims on, foreign residents. 4. Comprises Algeria, Gabon, Libya, and Nigeria. 1. Includes the Bank for International Settlements. Beginning April 1978, also 5. Asian, African, Middle Eastern, and European regional organizations, includes Eastern European countries not listed in line 23. except the Bank for International Settlements, which is included in "Other 2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German Western Europe." Democratic Republic, Hungary, Poland, and Romania. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A60 International Statistics • January 1985 3.18 BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1984 AArreeaa aanndd ccoouunnttrryy 11998811AA 11998822 11998833 Mar. Apr. May June July Aug. Sept.? 1 Total 251,589 355,705 391,326' 387,417' 388,775' 399,796' 408,073 405,225' 395,678 392,737 2 Foreign countries 251,533 355,636 391,163' 387,267' 388,702' 399,693' 407,959 405,016' 395,480 392,666 3 Europe 49,262 85,584 91,874' 92,327' 96,321' 98,34c 104,011 102,253' 99,943 97,614 4 Austria 121 229 401 449 679 456 632 646 609 608 5 Belgium-Luxembourg 2,849 5,138 5,639 5,975' 6,243' 6,626 6,734 6,063 6,126 6,245 6 Denmark 187 554 1,275 1,283 1,197 1,118 1,212 1,204 1,103 1,072 7 Finland 546 990 1,044 931 1,021 1,041 1,100 928 871 881 8 France 4,127 7,251 8,766 8,392' 8,734 9,029 9,393 9,732 10,004 9,117 9 Germany 940 1,876 1.294 1,098 1,502 1,111 1,175 1,142 1,253 1,223 10 Greece 333 452 476 694 830 940 1,036 979 973 1,092 11 Italy 5,240 7,560 9,018 8,176' 8,292' 7,901 8,556 8,331 7,832 7,807 12 Netherlands 682 1,425 1,292' 1,299' 2,319' 1,787 1,781 1,811 1,439 1,483 13 Norway 384 572 690 638 705 719 729 648 649 650 14 Portugal 529 950 1.114' 1,119' 1,291' 1,366' 1,463 1,503' 1,433 1,386 15 Spain 2,095 3,744 3.583 3,347 3,719 3,700 3,792 3,955 3,700 3,361 16 Sweden 1,205 3,038 3,358 3,528 3,646 2,957 3,206 2,677' 2,443 2,598 17 Switzerland 2,213 1,639 1,856 1,447 1,849' 1,570 1,904 1,520 1,558 1,731 18 Turkey 424 560 812 963' 1,043' 1,047' 1,160 1,210 1,145 1,132 19 United Kingdom 23,849 45,781 47,273' 48,976' 49,097' 52,850 55,941 55,543' 54,573 53,016 20 Yugoslavia 1,225 1,430 1,718' 1,765' 1,754' 1,775' 1,808 1,817 1,857 1,887 21 Other Western Europe1 211 368 477 499 651 565 571 800 732 695 22 U.S.S.R 377 263 192 181 179' 172' 175 172 175 179 23 Other Eastern Europe2 1,725 1,762 1,598 1,548' 1,570' 1,610' 1,643 1,573' 1,471 1,450 24 Canada 9,193 13,678 16,341' 17,234' 17,033' 17,879 17,524 18,350 16,235 16,590 25 Latin America and Caribbean 138,347 187,969 205,426' 203,627' 202,451' 210,153' 208,990 209,162' 203,370 202,539 26 Argentina 7,527 10,974 11,749' 11,635' 11,411' 11,071 11,162 11,381' 11,021 11,186 27 Bahamas 43,542 56,649 59,597' 57,932' 56,958 61,526 58,963 58,475' 56,609 55,173 28 Bermuda 346 603 566 532 614 845 559 543 484 915 29 Brazil 16,926 23,271 24,667' 25,894' 26,108' 26,045' 26,226 26,013' 25,989 26,163 30 British West Indies 21,981 29,101 35,488' 33,855' 34,477' 36,788 37,490 38,754' 34,835 35,248 31 Chile 3,690 5,513 6,072' 6,164' 6,085 6,146 6,490 6,648 7,049 6,839 32 Colombia 2,018 3,211 3.745 3,667 3,649 3,524 3,559 3,490 3,444 3,433 33 Cuba 3 3 0 0 4 0 21 0 0 0 34 Ecuador 1,531 2,062 2,307 2,334 2,335 2,332 2,373 2,396 2,380 2,363 35 Guatemala3 124 124 129 128 129 127 125 124 130 129 36 Jamaica3 62 181 215 210 227 22(y 216 219 216 224 37 Mexico 22,439 29,552 34,807' 34,710' 34,702' 35,474' 35,849 35,456' 35,016 35,549 38 Netherlands Antilles 1,076 839 1,154 1,245 1,149 1,164 1,312 1,381' 1,288 1,291 39 Panama 6,794 10,210 7,848 8,367 7,679 7,990 7,843 7,660' 8,200 7,551 40 Peru 1,218 2,357 2,536 2,453 2,380 2,438 2,473 2,487 2,401 2,394 41 Uruguay 157 686 977 924 923 887 950 961 930 934 42 Venezuela 7,069 10,643 11,287 11,142 11,105 11,019 11,174 10,861' 11,137 10,957 43 Other Latin America and Caribbean 1,844 1,991 2,283 2,436 2,514 2,557 2,205 2,313 2,242 2,190 44 49,851 60,952 67,950' 64,426' 63,133' 63,615' 6677,,559977 6655,,116677'' 6655,,662200 6655,,880055 China 45 Mainland 107 214 292 364 428 348 554 64C 639 564 46 Taiwan 2,461 2,288 1,908 1,657 1,654 1,562' 2,202 2,011 1,573 1,654 47 Hong Kong 4,132 6,787 8,473' 7,505' 7,971' 7,47(K 8,141 6,967' 6,809 6,974 48 India 123 222 330 337 372 362 355 323 295 354 49 Indonesia 352 348 805 935 911 983 969 952 906 885 50 Israel 1,567 2,029 1,832 1,607 1,846 1,822 1,910 1,827 1,869 1,816 51 Japan 26,797 28,379 30,58c 28,706' 26,183' 27,153' 29,264 27,727' 28,980 30,659 52 Korea 7,340 9,387 9,962' 9,653' 10,306' 9,595 9,653 9,799' 9,558 9,660 53 Philippines 1,819 2,625 2,107' 2,403' 2,382' 2,433' 2,495 2,650 2,756 2,563 54 Thailand 565 643 1,104' 1,003' 1,018' 1,143' 949 974' 916 960 55 Middle East oil-exporting countries4 1,581 3,087 4,954 5,048' 5,113' 5,20C 5,118 5,214' 4,924 4,486 56 Other Asia 3,009 4,943 5,603' 5,207' 4,949' 5,543' 5,986 6,081 6,396 5,228 57 Africa 3,503 5,346 6,654 6,919 6,655' 6,764 6,840 7,048' 7,101 6,833 58 Egypt 238 322 747 744 698 666 734 638 613 650 59 Morocco 284 353 440 484 486 561 497 549 556 558 60 South Africa 1,011 2,012 2,634 2,989 2,908 2,974 3,065 3,307 3,281 3,144 61 Zaire 112 57 33 13 26 28 39 43 30 18 62 Oil-exporting countries5 657 801 1,073 1,029 1,000 967 1,004 1,025 996 944 63 Other 1,201 1,802 1,727 1,661 1,536' 1,568 1,502 1,485' 1,625 1,521 64 Other countries 1,376 2,107 2,918' 2,734 3,109 2,942 2,996 3,036 3,210 3,285 65 Australia 1,203 1,713 2,276 2,007 2,489 2,345 2,435 2,481 2,582 2,680 66 All other 172 394 642' 727 620 597 561 554 628 605 67 Nonmonetary international and regional organizations6 56 68 164 150 74 103 114 209' 198 71 • Liabilities and claims of banks in the United States were increased, 3. Included in "Other Latin America and Caribbean" through March 1978. beginning in December 1981, by the shift from foreign branches to international 4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and banking facilities in the United States of liabilities to, and claims on, foreign United Arab Emirates (Trucial States). residents. 5. Comprises Algeria, Gabon, Libya, and Nigeria. 1. Includes the Bank for International Settlements. Beginning April 1978, also 6. Excludes the Bank for International Settlements, which is included in includes Eastern European countries not listed in line 23. "Other Western Europe." 2. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German NOTE. Data for period before April 1978 include claims of banks' domestic Democratic Republic, Hungary, Poland, and Romania. customers on foreigners. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A61 3.19 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 1984 TTyyppee ooff ccllaaiimm 11998811AA 11998822 11998833'' Mar.' Apr.' May' June July' Aug. Sept.P 1 Total 222222888888777777,,,,,,555555555555777777 333333999999666666,,,,,,000000111111555555 444444222222666666,,,,,,222222222222999999 444444222222444444,,,,,,555555555555777777 444444444444444444,,,,,,777777111111666666 444444222222666666,,,,,,555555777777666666 22 BBaannkkss'' oowwnn ccllaaiimmss oonn ffoorreeiiggnneerrss ........ 222222555555111111,,,,,,555555888888999999 333333555555555555,,,,,,777777000000555555 333333999999111111,,,,,,333333222222666666 333333888888777777,,,,,,444444111111777777 388,775 399,796 444444000000888888,,,,,,000000777777333333 405,225 395,678 333333999999222222,,,,,,777777333333777777 33 FFoorreeiiggnn ppuubblliicc bboorrrroowweerrss 333333111111,,,,,,222222666666000000 444444555555,,,,,,444444222222222222 555555777777,,,,,,555555333333000000 555555777777,,,,,,777777555555000000 58,042 58,092 555555999999,,,,,,333333000000000000 59,889 58,256 555555999999,,,,,,666666111111999999 44 OOwwnn ffoorreeiiggnn ooffffiicceess'' 999999666666,,,,,,666666555555333333 111111222222777777,,,,,,222222999999333333 111111444444666666,,,,,,222222111111999999 111111444444777777,,,,,,999999888888111111 146,485 155,703 111111555555777777,,,,,,555555333333999999 156,233 153,235 111111444444999999,,,,,,999999222222999999 55 UUnnaaffffiilliiaatteedd ffoorreeiiggnn bbaannkkss 777777444444,,,,,,777777000000444444 111111222222111111,,,,,,333333777777777777 111111222222444444,,,,,,000000555555111111 111111222222111111,,,,,,999999222222111111 123,664 125,654 111111333333000000,,,,,,555555444444000000'''''' 127,679 123,893 111111222222222222,,,,,,444444999999777777 66 DDeeppoossiittss 222222333333,,,,,,333333888888111111 444444444444,,,,,,222222222222333333 444444777777,,,,,,000000666666666666 444444555555,,,,,,555555333333111111 45,106 47,066 444444999999,,,,,,777777222222444444 48,337 46,908 444444777777,,,,,,333333888888555555 77 OOtthheerr 555555111111,,,,,,333333222222222222 777777777777,,,,,,111111555555333333 777777666666,,,,,,999999888888555555 777777666666,,,,,,333333999999000000 78,558 78,588 888888000000,,,,,,888888111111555555'''''' 79,342 76,985 777777555555,,,,,,111111111111222222 88 AAllll ootthheerr ffoorreeiiggnneerrss 444444888888,,,,,,999999777777222222 666666111111,,,,,,666666111111444444 666666333333,,,,,,555555222222777777 555555999999,,,,,,777777666666444444 60,584 60,347 666666000000,,,,,,666666999999444444'''''' 61,424 60,294 666666000000,,,,,,666666999999222222 99 CCllaaiimmss ooff bbaannkkss'' ddoommeessttiicc ccuussttoommeerrss22 333333555555,,,,,,999999666666888888 444444000000,,,,,,333333111111000000 333333444444,,,,,,999999000000333333 333333777777,,,,,,111111444444000000 333333666666,,,,,,666666444444333333 333333333333,,,,,,888888333333999999 111111,,,,,,333333777777888888 222222,,,,,,444444999999111111 222222,,,,,,999999666666999999 333333,,,,,,666666666666000000 333333,,,,,,444444555555888888 444444,,,,,,555555777777555555 11 Negotiable and readily transferable 222222666666,,,,,,333333555555222222 333333000000,,,,,,777777666666333333 222222666666,,,,,,000000666666444444 222222666666,,,,,,999999444444777777 222222555555,,,,,,888888222222333333 222222333333,,,,,,333333888888222222 12 Outstanding collections and other 888888,,,,,,222222333333888888 777777,,,,,,000000555555666666 555555,,,,,,888888777777000000 666666,,,,,,555555333333333333 777777,,,,,,333333666666222222 555555,,,,,,888888888888222222 13 MEMO: Customer liability on acceptances 222222999999,,,,,,999999555555222222 333333888888,,,,,,111111555555333333 333333777777,,,,,,888888222222000000 333333666666,,,,,,999999888888444444 444444222222,,,,,,666666555555777777 333333888888,,,,,,444444555555444444 Dollar deposits in banks abroad, reported by nonbanking business enterprises in the United States4 ... 40,369 42,499 45,790 47,035 48,559 47,620 43,790' 42,480 43,142 n.a. 1. U.S. banks: includes amounts due from own foreign branches and foreign 4. Includes demand and time deposits and negotiable and nonnegotiable subsidiaries consolidated in "Consolidated Report of Condition" filed with bank certificates of deposit denominated in U.S. dollars issued by banks abroad. For regulatory agencies. Agencies, branches, and majority-owned subsidiaries of description of changes in data reported by nonbanks, see July 1979 BULLETIN, foreign banks: principally amounts due from head office or parent foreign bank, p. 550. and foreign branches, agencies, or wholly owned subsidiaries of head office or • Liabilities and claims of banks in the United States were increased, parent foreign bank. beginning in December 1981, by the shift from foreign branches to international 2. Assets owned by customers of the reporting bank located in the United banking facilities in the United States of liabilities to, and claims on, foreign States that represent claims on foreigners held by reporting banks for the account residents. of their domestic customers. NOTE. Beginning April 1978, data for banks' own claims are given on a monthly 3. Principally negotiable time certificates of deposit and bankers acceptances. basis, but the data for claims of banks' own domestic customers are available on a quarterly basis only. 3.20 BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1983 1984 MMaattuurriittyy;; bbyy bboorrrroowweerr aanndd aarreeaa 11998811AA 11998822 Sept.' Dec.' Mar.' June Sept.P 1 154,590 228,150 236,952 243,310 237,642 249,927 240,806 By borrower 2 Maturity of 1 year or less' 116,394 173,917 175,957 176,270 162,998 172,410 163,041 3 Foreign public borrowers 15,142 21,256 25,138 24,034 20,444 21,010 21,075 4 All other foreigners 101,252 152,661 150,819 152,237 142,554 151,400 141,966 5 Maturity of over 1 year' 38,197 54,233 60,994 67,040 74,644 77,517 77,765 6 Foreign public borrowers 15,589 23,137 28,297 32,495 36,306 37,768 37,960 7 All other foreigners 22,608 31,095 32,697 34,544 38,338 39,749 39,805 By area Maturity of 1 year or less' 8 Europe 28,130 50,500 53,489 56,064 53,764 59,405 56,797 9 Canada 4,662 7,642 6,658 6,211 6,579 6,990 5,879 10 Latin America and Caribbean 48,717 73,291 76,099 73,637 65,559 64,780 61,502 11 31,485 37,578 33,686 34,571 31,286 34,793 32,348 12 Africa 2,457 3,680 4,570 4,199 4,472 4,790 4,798 13 All other2 943 1,226 1,454 1,589 1,340 1,652 1,717 Maturity of over 1 year1 14 Europe 8,100 11,636 12,356 13,365 13,063 12,827 11,261 15 Canada 1,808 1,931 1,760 1,857 2,038 2,203 1,802 16 Latin America and Caribbean 25,209 35,247 39,185 43,603 50,913 54,278 56,567 17 1,907 3,185 4,735 4,828 5,133 5,107 5,128 18 Africa 900 1,494 1,819 2,286 2,291 1,865 1,857 19 All other2 272 740 1,139 1,101 1,206 1,237 1,150 • Liabilities and claims of banks in the United States were increased, 1. Remaining time to maturity, beginning in December 1981, by the shift from foreign branches to international 2. Includes nonmonetary international and regional organizations, banking facilities in the United States of liabilities to, and claims on, foreign residents. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 International Statistics • January 1985 3.21 CLAIMS ON FOREIGN COUNTRIES Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks' Billions of dollars, end of period 1982 1983 1984 AArreeaa oorr ccoouunnttrryy 11997799 11998800 11998811 Sept. Dec. Mar. June Sept. Dec. Mar. June7 1 Total 303.9 352.0 415.2 438.4 438.7 441.1 437.4 430.2 436.0 431.3 428.1' 2 G-10 countries and Switzerland 138.4 162.1 175.5 175.4 179.7 182.2 176.9 168.9 167.9 165.1 156.1 3 Belgium-Luxembourg 11.1 13.0 13.3 13.6 13.1 13.7 13.3 12.6 12.4 11.0 10.4 4 France 11.7 14.1 15.3 15.8 17.1 17.1 17.1 16.2 16.3 15.9 14.2 5 Germany 12.2 12.1 12.9 12.2 12.7 13.5 12.6 11.6 11.3 11.7 11.0 6 Italy 6.4 8.2 9.6 9.7 10.3 10.2 10.5 10.0 11.4 11.2 11.5 7 Netherlands 4.8 4.4 4.0 3.8 3.6 4.3 4.0 3.6 3.5 3.3 3.0 8 Sweden 2.4 2.9 3.7 4.7 5.0 4.3 4.7 4.9 5.1 5.2 4.3 9 Switzerland 4.7 5.0 5.5 5.1 5.0 4.6 4.8 4.2 4.3 4.2 4.2 10 United Kingdom 56.4 67.4 70.1 70.3 72.1 72.9 70.3 67.6 65.1 64.2 59.2 11 Canada 6.3 8.4 10.9 11.0 10.4 12.5 10.8 9.0 8.3 8.6 8.8 12 Japan 22.4 26.5 30.2 29.3 30.2 29.2 28.7 29.2 30.1 30.0 29.5 13 Other developed countries 19.9 21.6 28.4 32.7 33.7 34.0 34.4 34.2 35.9 35.5 37.1 14 Austria 2.0 1.9 1.9 2.0 1.9 2.1 2.1 1.9 1.9 2.0 2.0 15 Denmark 2.2 2.3 2.3 2.5 2.4 3.3 3.4 3.3 3.4 3.4 3.1 16 Finland 1.2 1.4 1.7 1.8 2.2 2.1 2.1 1.8 2.4 2.1 2.3 17 Greece 2.4 2.8 2.8 2.6 3.0 2.9 2.9 2.9 2.8 3.0 3.3 18 Norway 2.3 2.6 3.1 3.4 3.3 3.3 3.4 3.2 3.3 3.2 3.2 19 Portugal .7 .6 1.1 1.6 1.5 1.4 1.4 1.3 1.3 1.1 1.7 20 Spain 3.5 4.4 6.6 7.7 7.5 7.1 7.2 7.2 7.1 7.1 7.3 21 Turkey 1.4 1.5 1.4 1.5 1.4 1.5 1.4 1.5 1.7 1.9 2.0 22 Other Western Europe 1.4 1.7 2.1 2.1 2.3 2.3 2.0 2.1 1.8 1.8 1.9 23 South Africa 1.3 1.1 2.8 3.6 3.7 3.6 3.9 4.7 4.7 4.8 4.7 24 Australia 1.3 1.3 2.5 4.0 4.4 4.6 4.6 4.4 5.5 5.2 5.7 25 OPEC countries2 22.9 22.7 24.8 27.3 27.4 28.5 28.3 27.2 28.9 28.6 26.7 26 Ecuador 1.7 2.1 2.2 2.3 2.2 2.2 2.2 2.1 2.2 2.1 2.1 27 Venezuela 8.7 9.1 9.9 10.4 10.5 10.4 10.4 9.8 9.9 9.7 9.5 28 Indonesia 1.9 1.8 2.6 2.9 3.2 3.5 3.2 3.4 3.8 4.0 4.1 29 Middle East countries 8.0 6.9 7.5 9.0 8.7 9.3 9.5 9.1 10.0 9.8 8.4 30 African countries 2.6 2.8 2.5 2.7 2.8 3.0 3.0 2.8 3.0 3.0 2.7 31 Non-OPEC developing countries 63.0 77.4 96.3 104.1 107.1 107.7 108.3 109.4 111.1 111.6 113.7' Latin America 32 Argentina 5.0 7.9 9.4 9.2 8.9 9.0 9.4 9.5 9.5 9.5 9.2 33 Brazil 15.2 16.2 19.1 22.4 22.9 23.1 22.6 22.9 22.9 24.9 25.4 34 Chile 2.5 3.7 5.8 6.2 6.3 6.0 5.8 6.2 6.4 6.5 6.7 35 Colombia 2.2 2.6 2.6 2.8 3.1 2.9 3.2 3.2 3.2 3.1 3.0 36 Mexico 12.0 15.9 21.6 25.0 24.5 25.1 25.2 25.9 26.0 25.4 26.6' 37 Peru 1.5 1.8 2.0 2.6 2.6 2.4 2.6 2.4 2.4 2.3 2.3 38 Other Latin America 3.7 3.9 4.1 4.3 4.0 4.2 4.3 4.2 4.2 4.4 4.1 Asia China 39 Mainland .1 .2 .2 .2 .2 .2 .2 .2 .3 .3 .6 40 Taiwan 3.4 4.2 5.1 4.9 5.3 5.1 5.1 5.2 5.3 4.9 5.8 41 India .2 .3 .3 .5 .6 .4 .5 .8 1.0 1.0 1.0 42 Israel 1.3 1.5 2.1 1.9 2.3 2.0 2.3 1.7 1.9 1.6 1.9 43 Korea (South) 5.4 7.1 9.4 9.4 10.9 10.9 10.8 10.9 11.3 11.1 11.2 44 Malaysia 1.0 1.1 1.7 1.8 2.1 2.5 2.6 2.8 2.9 2.8 2.7 45 Philippines 4.2 5.1 6.0 6.1 6.3 6.6 6.4 6.2 6.2 6.6 6.3 46 Thailand 1.5 1.6 1.5 1.3 1.6 1.6 1.8 1.7 2.1 1.9 1.8 47 Other Asia .5 .6 1.0 1.3 1.1 1.4 1.2 1.0 1.0 .9 1.1 Africa 48 Egypt .6 .8 1.1 1.3 1.2 1.1 1.3 1.4 1.5 1.5 1.4 49 Morocco .6 .7 .7 .8 .7 .8 .8 .8 .8 .8 .8 50 Zaire .2 .2 .2 .1 .1 .1 .1 .1 .1 .1 .1 51 Other Africa3 1.7 2.1 2.3 2.2 2.4 2.3 2.2 2.4 2.3 2.2 1.9 52 Eastern Europe 7.3 7.4 7.8 6.3 6.2 5.7 5.7 5.3 5.3 4.9 4.9 53 U.S.S.R .7 .4 .6 .3 .3 .3 .4 .2 .2 .2 .2 54 Yugoslavia 1.8 2.3 2.5 2.2 2.2 2.2 2.3 2.3 2.3 2.2 2.3 55 Other 4.8 4.6 4.7 3.8 3.7 3.2 3.0 2.8 2.8 2.5 2.5 56 Offshore banking centers 40.4 47.0 63.7 72.2 66.8 66.2 67.6 68.3 70.1 69.3 72.3 57 Bahamas 13.7 13.7 19.0 21.4 19.0 17.4 19.6 21.1 21.2 23.7 26.5 58 Bermuda .8 .6 .7 .8 .9 1.0 .8 .8 .9 .7 .7 59 Cayman Islands and other British West Indies 9.4 10.6 12.4 13.6 12.9 12.0 12.2 10.7 12.4 11.0 11.7 60 Netherlands Antilles 1.2 2.1 3.2 3.3 3.3 3.1 2.6 4.1 4.2 3.3 3.3 61 Panama4 4.3 5.4 7.7 8.1 7.6 7.1 6.6 5.7 6.0 6.3 6.4 62 Lebanon .2 .2 .2 .1 .1 .1 .1 .1 .1 .1 .1 63 Hong Kong 6.0 8.1 11.8 15.1 13.9 15.1 14.6 15.1 14.9 14.4 13.5 64 Singapore 4.5 5.9 8.7 9.8 9.2 10.3 11.0 10.5 10.3 9.9 10.1 65 Others5 .4 .3 .1 .0 .0 .0 .0 .1 .0 .0 .0 66 Miscellaneous and unallocated6 11.7 14.0 18.8 20.4 17.9 16.8 16.1 16.9 17.0 16.4 17.3 1. The banking offices covered by these data are the U.S. offices and foreign Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, and United Arab Emirates) as well branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks. as Bahrain and Oman (not formally members of OPEC). Offices not covered include (1) U.S. agencies and branches of foreign banks, and 3. Excludes Liberia. (2) foreign subsidiaries of U.S. banks. To minimize duplication, the data are 4. Includes Canal Zone beginning December 1979. adjusted to exclude the claims on foreign branches held by a U.S. office or another 5. Foreign branch claims only. foreign branch of the same banking institution. The data in this table combine 6. Includes New Zealand, Liberia, and international and regional organizaforeign branch claims in table 3.14 (the sum of lines 7 through 10) with the claims tions. of U.S. offices in table 3.18 (excluding those held by agencies and branches of 7. Beginning with June 1984 data, reported claims held by foreign branches foreign banks and those constituting claims on own foreign branches). have been reduced by an increase in the reporting threshold for "shell" branches 2. Besides the Organization of Petroleum Exporting Countries shown individ- from $50 million to $150 million equivalent in total assets, the threshold now ually, this group includes other members of OPEC (Algeria, Gabon, Iran, Iraq, applicable to all reporting branches. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A63 3.22 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1983 1984 TTyyppee,, aanndd aarreeaa oorr ccoouunnttrryy 11998800 11998811 11998822 June Sept. Dec. Mar. JuneP 1 Total 29,434 28,618 25,772 22,886 24,864 23,763 29,260 33,282 2 Payable in dollars 25,689 24,909 22,540 19,986 22,023 20,688 25,978 30,096 3 Payable in foreign currencies 3,745 3,709 3,232 2,900 2,841 3,076 3,282 3,186 By type 4 Financial liabilities 11,330 12,157 11,066 11,179 10,961 10,477 14,236 17,927 5 Payable in dollars 8,528 9,499 8,858 9,144 9,025 8,619 12,145 15,876 6 Payable in foreign currencies 2,802 2,658 2,208 2,035 1,936 1,858 2,092 2,052 7 Commercial liabilities 18,104 16,461 14,706 11,707 13,903 13,286 15,024 15,354 8 Trade payables 12,201 10,818 7,747 6,064 7,139 6,615 7,865 7,854 9 Advance receipts and other liabilities 5,903 5,643 6,959 5,643 6,763 6,672 7,159 7,500 10 Payable in dollars 17,161 15,409 13,683 10,842 12,998 12,069 13,834 14,220 11 Payable in foreign currencies 943 1,052 1,023 865 904 1,218 1,190 1,134 By area or country Financial liabilities 12 Europe 6,481 6,825 6,501 6,335 6,014 5,675 7,081 7,068 13 Belgium-Luxembourg 479 471 505 436 379 302 426 356 14 France 327 709 783 802 785 820 933 878 15 Germany 582 491 467 457 449 498 524 571 16 Netherlands 681 748 711 728 730 581 532 589 17 Switzerland 354 715 792 606 500 486 641 581 18 United Kingdom 3,923 3,565 3,102 3,132 3,014 2,839 3,786 3,836 19 Canada 964 963 746 876 788 768 798 721 20 Latin America and Caribbean 3,136 3,356 2,751 2,623 2,737 2,609 4,907 8,631 21 Bahamas 964 1,279 904 776 784 751 1,411 3,572 22 Bermuda 1 7 14 10 13 13 51 13 23 Brazil 23 22 28 34 32 32 37 25 24 British West Indies 1,452 1,241 1,027 1,033 1,095 1,018 2,635 4,228 25 Mexico 99 102 121 151 185 215 245 239 26 Venezuela 81 98 114 124 117 124 121 124 27 Asia 723 976 1,039 1,319 1,388 1,396 1,423 1,482 28 Japan 644 792 715 943 957 962 1,013 1,031 29 Middle East oil-exporting countries2 38 75 169 205 201 170 170 180 30 Africa 11 14 17 17 19 19 19 16 31 Oil-exporting countries3 1 0 0 0 0 0 0 0 32 All other4 15 24 12 9 15 10 9 9 Commercial liabilities 33 Europe 4,402 3,770 3,682 3,395 3,426 3,153 3,567 3,397 34 Belgium-Luxembourg 90 71 52 41 47 62 40 45 35 France 582 573 598 618 523 437 488 524 36 Germany 679 545 468 439 462 427 417 501 37 Netherlands 219 220 346 342 243 268 259 265 38 Switzerland 499 424 364 357 449 241 477 246 39 United Kingdom 1,209 880 880 656 809 637 847 794 40 Canada 888 897 1,495 1,468 1,418 1,841 1,776 1,840 41 Latin America and Caribbean 1,300 1,044 1,012 1025 1,090 1,125 1,778 1,676 42 Bahamas 8 2 16 1 1 1 14 17 43 Bermuda 75 67 93 77 77 67 158 123 44 Brazil 111 67 60 49 48 44 68 31 45 British West Indies 35 2 32 22 14 6 33 5 46 Mexico 367 340 379 399 451 536 682 568 47 Venezuela 319 276 165 236 217 180 531 602 48 Asia 10,242 9,384 7,161 4,809 6,863 6,032 6,620 6,988 49 Japan 802 1,094 1,226 1,246 1,305 1,247 1,291 1,235 50 Middle East oil-exporting countries2 5 8,098 7,008 4,532 2,294 4,072 3,498 3,735 4,190 51 Africa 817 703 704 492 506 442 539 683 52 Oil-exporting countries3 517 344 277 167 204 157 243 217 53 All other4 456 664 651 518 600 692 743 769 1. For a description of the changes in the International Statistics tables, see 3. Comprises Algeria, Gabon, Libya, and Nigeria. July 1979 BULLETIN, p. 550. 4. Includes nonmonetary international and regional organizations. 2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and 5. Revisions include a reclassification of transactions, which also affects the United Arab Emirates (Trucial States). totals for Asia and the grand totals. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 International Statistics • January 1985 3.23 CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States' Millions of dollars, end of period 1983 1984 TTyyppee,, aanndd aarreeaa oorr ccoouunnttrryy 11998800 11998811 11998822 June Sept. Dec. Mar. June'' 1 Total 34,482 36,185 28,637 33,310 32,652 34,210 32,499 30,382 2 Payable in dollars 31,528 32,582 26,002 30,653 29,772 31,174 29,611 27,417 3 Payable in foreign currencies 2,955 3,603 2,635 2,657 2,880 3,036 2,888 2,965 By type 4 Financial claims 19,763 21,142 17,594 22,642 21,752 23,075 21,638 19,947 5 Deposits 14,166 15,081 13,058 17,819 16,907 17,954 16,602 14,878 6 Payable in dollars 13,381 14,456 12,628 17,379 16,463 17,457 16,173 14,369 7 Payable in foreign currencies 785 625 430 439 445 497 428 510 8 Other financial claims 5,597 6,061 4,536 4,824 4,845 5,121 5,036 5,068 9 Payable in dollars 3,914 3,599 2,895 3,226 3,019 3,219 3,247 3,312 10 Payable in foreign currencies 1,683 2,462 1,641 1,598 1,826 1,902 1,788 1,756 11 Commercial claims 14,720 15,043 11,042 10,668 10,899 11,135 10,862 10,436 12 Trade receivables 13,960 14,007 9,995 9,265 9,566 9,725 9,540 9,105 13 Advance payments and other claims 759 1,036 1,047 1,402 1,334 1,410 1,321 1,330 14 Payable in dollars 14,233 14,527 10,479 10,048 10,290 10,498 10,191 9,736 15 Payable in foreign currencies 487 516 563 620 609 637 671 699 By area or country Financial claims 16 Europe 6,069 4,5% 4,873 7,304 6,232 6,374 6,131 6,156 17 Belgium-Luxembourg 145 43 15 12 25 37 30 37 18 France 298 285 134 140 135 130 145 132 19 Germany 230 224 178 216 151 129 131 161 20 Netherlands 51 50 97 136 89 49 57 138 21 Switzerland 54 117 107 37 34 38 90 61 22 United Kingdom 4,987 3,546 4,064 6,514 5,577 5,768 5,468 5,398 23 Canada 5,036 6,755 4,287 4,885 4,958 5,836 5,400 5,009 24 Latin America and Caribbean 7,811 8,812 7,546 9,380 9,500 9,809 9,066 7,570 25 Bahamas 3,477 3,650 3,279 4,037 3,829 4,745 3,773 2,993 26 Bermuda 135 18 32 92 62 96 3 5 27 Brazil % 30 62 48 49 53 87 83 28 British West Indies 2.755 3,971 3,255 4,065 4,457 3,830 4,302 3,674 29 Mexico 208 313 274 348 315 291 279 228 30 Venezuela 137 148 139 152 137 134 130 124 31 607 758 698 771 764 764 727 909 32 Japan 189 366 153 288 257 297 284 252 33 Middle East oil-exporting countries2 20 37 15 14 8 4 7 8 34 Africa 208 173 158 154 151 147 144 158 35 Oil-exporting countries3 26 46 48 48 45 55 42 35 36 All other4 32 48 31 149 148 145 169 144 Commercial claims 37 Europe 5,544 5,405 3,828 3,473 3,412 3,678 3,608 3,542 38 Belgium-Luxembourg 233 234 151 145 132 142 173 142 39 France 1,129 776 474 497 486 459 413 407 40 Germany 599 561 357 366 382 348 363 440 41 Netherlands 318 299 350 243 282 333 308 299 42 Switzerland 354 431 360 331 292 317 336 250 43 United Kingdom 929 985 811 734 738 809 787 812 44 Canada 914 967 633 711 792 829 1,061 933 45 Latin America and Caribbean 3,766 3,479 2,526 2,728 2,870 22,,669955 22,,441199 2,042 46 Bahamas 21 12 21 30 15 88 88 4 47 Bermuda 108 223 261 111 246 190 216 89 48 Brazil 861 668 258 512 611 493 357 310 49 British West Indies 34 12 12 21 12 7 7 8 50 Mexico 1,102 1,022 775 957 898 884 745 577 51 Venezuela 410 424 351 273 282 272 268 241 52 Asia 3,522 3,959 3,050 2,867 2,938 3,071 2,997 3,085 53 Japan 1,052 1,245 1,047 949 1,037 1,122 1,186 1,178 54 Middle East oil-exporting countries2 825 905 751 698 719 737 701 710 55 Africa 653 772 588 528 562 585 497 536 56 Oil-exporting countries3 153 152 140 130 131 139 132 128 57 All other4 321 461 417 361 326 277 280 297 1. For a description of the changes in the International Statistics tables, see 3. Comprises Algeria, Gabon, Libya, and Nigeria. July 1979 BULLETIN, p. 550. 4. Includes nonmonetary international and regional organizations. 2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Holdings and Transactions A65 3.24 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1984 1984 TTrraannssaaccttiioonnss,, aanndd aarreeaa oorr ccoouunnttrryy 11998822 11998833 Jan.- Sept. Mar. Apr. May June July Aug. Sept.? U.S. corporate securities STOCKS 1 Foreign purchases 41,881 69,770 46,531 6,101 4,510 5,048 4,552 3,359 7,243 4,046 2 Foreign sales 37,981 64,360 48,163 5,746' 4,189 5,494 4,899 3,915 7,399 4,898 3 Net purchases, or sales (—) 3,901 5,410 -1,632 355' 321 -446 -347 -556 -155 -852 4 Foreign countries 3,816 5,312 -1,826 323' 320 -454 -357 -565 -302 -921 5 Europe 2,530 3,979 -1,954 188' 208 -281 -317 -606 -422 -702 6 France -143 -97 -178 -4 38 100 -3 -45 -28 -67 7 Germany 333 1,045 53 151 -43 -40 2 -38 -125 -63 8 Netherlands -63 -109 -235 32 -15 -47 -76 -34 -31 -66 9 Switzerland -579 1,325 -1,077 -3 90 -220 -120 -321 -358 -335 10 United Kingdom 3,117 1,799 -540 -17' 137 -80 -179 -141 146 -143 11 Canada 222 1,151 1,343 300 73 -61 158 188 129 149 12 Latin America and Caribbean 317 529 485 9' 25 82 38 -58 213 9 13 Middle East1 366 -807 -1,520 -197 -58 -168 -215 -55 -214 -207 14 Other Asia 247 394 -234 33 66 -28 -27 -49 -57 -160 15 Africa 2 42 -2 -7 5 -4 3 -2 -5 -6 16 Other countries 131 24 57 -1 2 6 2 16 54 -3 17 Nonmonetary international and regional organizations 85 98 194 32 1 8 10 9 147 69 BONDS2 18 Foreign purchases 21,639 24,049 20,982 2,305' 1,708' 1,619 2,004 3,082 2,865 3,456 19 Foreign sales 20,188 23,099' 17,512 2,080' 1,866' 1,442 1,795 2,503 2,030 2,035 20 Net purchases, or sales (-) 1,451 95C 3,470 225' -159' 178 208 579 835 1,421 21 Foreign countries 1,479 935' 3,341 283' -226' 212 168 539 882 1,377 22 Europe 2,082 961 2,529 82' 15' 85 272 480 483 1,103 23 France 305 -89 51 -1 -5 0 4 33 17 8 24 Germany 2,110 347 801 117 68 107 122 256 181 19 25 Netherlands 33 51 57 9 -12 -1 11 3 16 2 26 Switzerland 157 632 -44 -45 -22 8 35 13 49 9 27 United Kingdom -589 434 1,265 39' -246' -59 77 -80 292 1,021 28 Canada 24 123 -95 -23 -77 3 32 -35 54 3 29 Latin America and Caribbean 159 100 226 20' -4' 13 15 14 76 64 30 Middle East1 -752 -1,166' -554 30 -263 11 -287 -60 1 -19 31 Other Asia -22 865 1,226 170 102 100 135 138 265 223 32 Africa -19 0 2 0 1 0 0 0 1 1 33 Other countries 7 52 7 3 1 0 0 1 3 3 34 Nonmonetary international and regional organizations -28 15 129 -57 67 -34 40 41 -48 43 Foreign securities 35 Stocks, net purchases, or sales (-) -1,341 -3,765 -338 145 -18 70 -40 113 -500 -342 36 Foreign purchases 7,163 13,281 10,849 1,575 1,242 1,163 1,110 895 1,245 919 37 Foreign sales 8,504 17,046 11,188 .1,429 1,260 1,092 1,150 782 1,745 1,260 38 Bonds, net purchases, or sales (-) -6,631 -3,131' -1,108 73' -409' -646' 241 184 -293 -435 39 Foreign purchases 27,167 36,441' 40,969 4,988' 3,817' 5,158' 5,308 4,427 5,770 4,168 40 Foreign sales 33,798 39,572 42,077 4,915' 4,226' 5,804' 5,066 4,243 6,062 4,604 41 Net purchases, or sales (-), of stocks and bonds .... -7,972 -6,896' -1,447 218' -427' -575' 201 297 -793 -777 42 Foreign countries -6,806 -6,451' -1,635 132' -425' -650' 187 235 -630 -832 43 Europe -2,584 -5,423' -5,038 -241' -551' -1,527' -471 -462 -622 -710 44 Canada -2,363 -1,312' -1 117 -187 37' 122 174 -7 -448 45 Latin America and Caribbean 336 1,120 2,000 49 13C 602 465 237 127 83 46 Asia -1,822 -855 1,409 220 187 243 80 333 -134 165 47 Africa -9 141 -75 -10 -4 -16 -4 -21 11 -14 48 Other countries -364 -122' 69 -3 0 12 -6 -25 -4 92 49 Nonmonetary international and regional organizations -1,165 -445 189 87' -2 74 15 62 -163 55 1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait, 2. Includes state and local government securities, and securities of U.S. Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). government agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments abroad. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A66 International Statistics • January 1985 3.25 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Holdings and Transactions Millions of dollars 1984 1984 11998822 11998833 Country or area Jan.- Sept. Mar. Apr. May June July Aug. Sept.'' Holdings (end of period)1 1 Estimated total2 85,220 88,932 89,665' 92,013' 93,421' 93,307' 94,912' 101,507 97,688 2 Foreign countries2 80,637 83,818 84,402' 85,427' 85,81CK 86,782' 87,96c 93,536 91,799 3 Europe2 29,284 35,509 37,229' 37,79C 38,386' 39,295' 40,389' 44,379 43,661 4 Belgium-Luxembourg 447 16 57 91 61 135 138 171 191 5 Germany2 14,841 17,290 18,834 19,201 19,649 19,735 19,627 20,663 19,915 6 Netherlands 2,754 3,129 3,023 3,117 2,979 3,014 3,120 3,133 3,127 7 Sweden 677 847 945 949 954 940 957 905 981 8 Switzerland2 1,540 1.118 1,256 1,241 1,403 1,752 2,021 2,089 2,188 9 United Kingdom 6,549 8,515 8,415' 8,420' 8,656' 9,200' 9,443' 12,301 11,988 10 Other Western Europe 2,476 4,594 4,707 4,776 4,691 4,525 5,084 5,119 5,272 11 Eastern Europe 0 0 0 0 -1 -1 -1 -1 -1 12 Canada 602 1,301 1,090 1,299 1,493' 1,600' 1,631' 1,862 2,149 13 Latin America and Caribbean 1,076 863 563 572 777' 677' 134' 447 611 14 Venezuela 188 64 64 65 65 75 75 76 79 15 Other Latin America and Caribbean 656 716 504 453 546 489 591 822 914 16 Netherlands Antilles 232 83 -6 53 166' 112' -532' -452 -382 17 Asia 49,543 46,026 45,417' 45,626' 44,989' 45,046' 45.61C 46,610 45,135 18 Japan 11,578 13,911 14,338' 14,551' 14,875' 15,365' 15,75C 16,279 16,250 19 Africa 77 79 82 85 88 88 88 -11 15 20 All other 55 38 21 57 77 77 108 250 227 21 Nonmonetary international and regional organizations 4,583 5,114 5,263' 6,586' 7,611' 6,525' 6,952' 7,971 5,889 22 International 4,186 4,404 4,614 5,936 6,946 5,860 6,241 7,340 5,191 23 Latin American regional 6 6 6 6 6 6 6 6 6 Transactions (net purchases, or sales (-) during period) 24 Total2 14,972 3,711 8,756 -522' 2,348 1,407 -114 1,599 6,596 -3,820 25 Foreign countries2 16,072 3,180 7,982 29' 1,025 382 972 1,172 5,576 -1,736 26 Official institutions 14,550 779 6 481' 622 -358 -871 177 1,366 -1,971 27 Other foreign2 1,518 2,400 7,978 -452' 403 740 1,843 994 4,210 235 28 Nonmonetary international and regional organizations -1,097 535 773 -551 1,322 1,026 -1,086 428 1,020 -2,084 MEMO: Oil-exporting countries 29 Middle East3 7,575 -5,419 -3,806 54' -678 -1,037 67 -312 -411 -144 30 Africa4 -552 -1 -101 0 0 0 0 0 -100 0 1. Estimated official and private holdings of marketable U.S. Treasury securi- 2. Beginning December 1978, includes U.S. Treasury notes publicly issued to ties 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 United Arab Emirates (Trucial States). foreign countries. 4. Comprises Algeria, Gabon, Libya, and Nigeria. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Interest and Exchange Rates A67 3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Percent per annum Rate on Nov. 30, 1984 Rate on Nov. 30, 1984 Rate on Nov. 30, 1984 Country Country Country Per- Month Per- Month Per- Month cent effective cent effective cent effective Austria.. 4.5 June 1984 France1 10.75 Nov. 1984 Norway 8.0 June 1979 Belgium . 11.0 Feb. 1984 Germany, Fed. Rep. of 4.5 June 1984 Switzerland 4.0 Mar. 1983 Brazil... 49.0 Mar. 1981 Italy 16.5 Sept. 1984 United Kingdom2 Canada.. 10.75 Nov. 1984 Japan 5.0 Oct. 1983 Venezuela May 1983 Denmark 7.0 Oct. 1983 Netherlands 5.0 Sept. 1983 1. As of the end of February 1981, the rate is that at which the Bank of France or makes advances against eligible commercial paper and/or government commerdiscounts Treasury bills for 7 to 10 days. cial banks or brokers. For countries with more than one rate applicable to such 2. Minimum lending rate suspended as of Aug. 20, 1981. discounts or advances, the rate shown is the one at which it is understood the NOTE. Rates shown are mainly those at which the central bank either discounts central bank transacts the largest proportion of its credit operations. 3.27 FOREIGN SHORT-TERM INTEREST RATES Percent per annum, averages of daily figures 1984 CCoouunnttrryy,, oorr ttyyppee 11998811 11998822 11998833 May June July Aug. Sept. Oct. Nov. 1 Eurodollars 16.79 12.24 9.57 11.53 11.68 12.02 11.81 11.67 10.77 9.50 2 United Kingdom 13.86 12.21 10.06 9.32 9.43 11.38 11.09 10.79 10.60 9.87 3 18.84 14.38 9.48 11.52 11.86 13.03 12.41 12.20 11.99 11.09 4 Germany 12.05 8.81 5.73 6.08 6.11 6.09 6.00 5.81 6.06 5.92 5 Switzerland 9.15 5.04 4.11 3.83 4.15 4.72 4.81 5.04 5.23 5.03 6 Netherlands 11.52 8.26 5.58 6.05 6.09 6.39 6.26 6.23 6.16 5.87 7 15.28 14.61 12.44 12.16 12.23 11.70 11.37 11.00 10.75 10.54 8 Italy 19.98 19.99 18.95 16.80 16.75 16.73 16.50 17.28 17.13 17.13 9 Belgium 15.28 14.10 10.51 11.80 11.90 11.90 11.73 11.16 11.00 10.81 10 Japan 7.58 6.84 6.49 6.24 6.35 6.31 6.35 6.33 6.31 6.32 NOTE. Rates are for 3-month interbank loans except for Canada, finance company paper; Belgium, 3-month Treasury bills; and Japan, Gensaki rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 International Statistics • January 1985 3.28 FOREIGN EXCHANGE RATES Currency units per dollar 1984 CCoouunnttrryy//ccuurrrreennccyy 11998811 11998822 11998833 June July Aug. Sept. Oct. Nov. 1 Australia/dollar1 114.95 101.65 90.14 88.26 83.42 84.73 83.08 83.64 85.88 2 Austria/schilling 15.948 17.060 17.968 19.226 19.998 20.268 21.293 21.557 21.075 3 Belgium/franc 37.194 45.780 51.121 55.840 57.714 58.282 61.132 62.048 60.475 4 Brazil/cruzeiro 92.374 179.22 573.27 1,643.81 1,819.00 1994.30 2226.79 2453.64 2734.16 5 Canada/dollar 1.1990 1.2344 1.2325 1.3040 1.3238 1.3035 1.3145 1.3189 1.3168 6 China, P.R./yuan 1.7031 1.8978 1.9809 2.2178 2.2996 2.3718 2.5469 2.6488 2.6785 7 Denmark/krone 7.1350 8.3443 9.1483 10.050 10.4178 10.5174 10.9753 11.090 10.824 8 Finland/markka 4.3128 4.8086 5.5636 5.8182 6.0187 6.0626 6.2783 6.3726 6.2653 9 France/franc 5.4396 6.5793 7.6203 8.4181 8.7438 8.8567 9.3041 9.4108 9.1981 10 Germany/deutsche mark 2.2631 2.428 2.5539 2.7397 2.8492 2.8856 3.0314 3.0678 2.9985 11 Greece/drachma n.a. 66.872 87.895 108.85 112.40 115.11 120.40 126.06 123.63 12 Hong Kong/dollar 5.5678 6.0697 7.2569 7.8131 7.8519 7.8388 7.8430 7.8242 7.8235 13 India/rupee 8.6807 9.4846 10.1040 11.064 11.371 11.556 11.858 12.027 12.078 14 Ireland/pound1 161.32 142.05 124.81 111.67 107.63 106.84 102.28 100.85 103.41 15 Israel/shekel n.a. 24.407 55.865 215.06 253.14 n.a. n.a. n.a. n.a. 16 Italy/lira 1138.60 1354.00 1519.30 1,694.80 1,751.18 1780.47 1870.79 1898.98 1863.05 17 Japan/yen 220.63 249.06 237.55 233.57 243.07 242.26 245.46 246.75 243.63 18 Malaysia/ringgit 2.3048 2.3395 2.3204 2.3109 2.3385 2.3331 2.3528 2.4076 2.4300 19 Mexico/peso 24.547 72.990 155.01 196.54 196.63 196.98 197.71 203.33 210.79 20 Netherlands/guilder 2.4998 2.6719 2.8543 3.0882 3.2155 3.2539 3.4188 3.4597 3.3817 21 New Zealand/dollar1 86.848 75.101 66.790 64.205 55.631 49.912 48.953 48.614 49.278 22 Norway/krone 5.7430 6.4567 7.3012 7.8162 8.2151 8.2991 8.6246 8.8721 8.7175 23 Philippines/peso 7.8113 8.5324 11.0940 14.250 n.a. n.a. n.a. n.a. n.a. 24 Portugal/escudo 61.739 80.101 111.610 141.83 152.17 151.02 158.45 163.36 163.10 25 Singapore/dollar 2.1053 2.1406 2.1136 2.1122 2.1473 2.1472 2.1635 2.1667 2.1554 26 South Africa/rand1 114.77 92.297 89.85 76.49 66.52 63.76 60.08 56.54 55.47 27 South Korea/won n.a. 731.93 776.04 802.20 810.96 811.42 815.82 820.03 818.89 28 Spain/peseta 92.396 110.09 143.500 154.75 161.37 164.41 170.19 172.15 168.10 29 Sri Lanka/rupee 18.967 20.756 23.510 25.176 25.223 25.285 25.605 25.906 26.075 30 Sweden/krona 5.0659 6.2838 7.6717 8.0993 8.3063 8.3489 8.5892 8.6887 8.5957 31 Switzerland/franc 1.9674 2.0327 2.1006 2.2832 2.4115 2.4150 2.5049 2.5245 2.4700 32 Taiwan/Dollar n.a. n.a. n.a. 39.843 39.477 39.092 39.159 39.226 39.419 33 Thailand/baht 21.731 23.014 22.991 23.010 23.020 23.018 23.013 23.020 26.736 34 United Kingdom/pound1 202.43 174.80 151.59 137.70 132.00 131.32 125.63 121.96 123.92 35 Venezuela/bolivar 4.2781 4.2981 10.6840 14.709 13.067 12.725 n.a. n.a. n.a. MEMO United States/dollar2 102.94 116.57 125.34 134.31 139.30 140.21 145.70 147.56 144.92 1. Value in U.S. cents. NOTE. Averages of certified noon buying rates in New York for cable transfers. 2. Index of weighted-average exchange value of U.S. dollar against currencies Data in this table also appear in the Board's G.5 (405) release. For address, see of other G-10 countries plus Switzerland. March 1973 = 100. Weights are 1972-76 inside front cover. global trade of each of the 10 countries. Series revised as of August 1978. For description and back data, see "Index of the Weighted-Average Exchange Value of the U.S. Dollar: Revision" on p. 700 of the August 1978 BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A69 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 when IPCs Individuals, partnerships, and corporations about half of the figures in that column are changed.) REITs Real estate investment trusts * Amounts insignificant in terms of the last decimal place RPs Repurchase agreements shown in the table (for example, less than 500,000 SMSAs Standard metropolitan statistical areas when the smallest unit given is millions) Cell not applicable General Information Minus signs are used to indicate (1) a decrease, (2) a negative obligations of the Treasury. "State and local government" figure, or (3) an outflow. also includes municipalities, special districts, and other politi- "U.S. government securities" may include guaranteed cal subdivisions. issues 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 rounding. STATISTICAL RELEASES List Published Semiannually, with Latest Bulletin Reference Issue Page Anticipated schedule of release dates for periodic releases December 1984 A77 SPECIAL TABLES Published Irregularly, with Latest Bulletin Reference Assets and liabilities of commercial banks, March 31, 1983 August 1983 A70 Assets and liabilities of commercial banks, June 30, 1983 December 1983 A68 Assets and liabilities of commercial banks, September 30, 1983 March 1984 A68 Assets and liabilities of commercial banks, December 31, 1983 June 1984 A66 Assets and liabilities of U.S. branches and agencies of foreign banks, June 30, 1983 December 1983 A74 Assets and liabilities of U.S. branches and agencies of foreign banks, September 30, 1983 March 1984 A74 Assets and liabilities of U.S. branches and agencies of foreign banks, December 31, 1983 June 1984 A72 Assets and liabilities of U.S. branches and agencies of foreign banks, March 31, 1984 November 1984 A4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A70 Federal Reserve Board of Governors PAUL A. VOLCKER, Chairman HENRY C. WALLICH PRESTON MARTIN, 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 DONALD J. WINN, Assistant to the Board STEPHEN H. AXILROD, Staff Director STEVEN M. ROBERTS, Assistant to the Chairman DONALD L. KOHN, Deputy Staff Director ANTHONY F. COLE, Special Assistant to the Board STANLEY J. SIGEL, Assistant to the Board ANNETTE P. FRIBOURG, Special Assistant to the Board NORMAND R.V. BERNARD, Special Assistant to the Board NAOMI P. SALUS, Special Assistant to the Board DIVISION OF RESEARCH AND STATISTICS LEGAL DIVISION JAMES L. KICHLINE, Director MICHAEL BRADFIELD, General Counsel EDWARD C. ETTIN, Deputy Director J. VIRGIL MATTINGLY, JR., Associate General Counsel MICHAEL J. PRELL, Deputy Director GILBERT T. SCHWARTZ, Associate General Counsel JOSEPH S. ZEISEL, Deputy Director RICHARD M. ASHTON, Assistant General Counsel JARED J. ENZLER, Associate Director NANCY P. JACKLIN, Assistant General Counsel ELEANOR J. STOCKWELL, Associate Director MARYELLEN A. BROWN, Assistant to the General Counsel DAVID E. LINDSEY, Deputy Associate Director HELMUT F. WENDEL, Deputy Associate Director MARTHA BETHEA, Assistant Director OFFICE OF THE SECRETARY ROBERT M. FISHER, Assistant Director SUSAN J. LEPPER, Assistant Director WILLIAM W. WILES, Secretary THOMAS D. SIMPSON, Assistant Director BARBARA R. LOWREY, Associate Secretary LAWRENCE SLIFMAN, Assistant Director JAMES MCAFEE, Associate Secretary STEPHEN P. TAYLOR, Assistant Director PETER A. TINSLEY, Assistant Director LEVON H. GARABEDIAN, Assistant Director DIVISION OF CONSUMER (Adm inis t rat ion) AND COMMUNITY AFFAIRS GRIFFITH L. GARWOOD, Director DIVISION OF INTERNATIONAL FINANCE JERAULD C. KLUCKMAN, Associate Director GLENN E. LONEY, Assistant Director EDWIN M. TRUMAN, Director DOLORES S. SMITH, Assistant Director LARRY J. PROMISEL, Senior Associate Director CHARLES J. SIEGMAN, Senior Associate Director DALE W. HENDERSON, Associate Director DIVISION OF BANKING ROBERT F. GEMMILL, Staff Adviser SUPERVISION AND REGULATION PETER HOOPER, III, Assistant Director DAVID H. HOWARD, Assistant Director JOHN E. RYAN, Director RALPH W. SMITH, JR., Assistant Director WILLIAM TAYLOR, Deputy Director FREDERICK R. DAHL, Associate Director DON E. KLINE, Associate Director FREDERICK M. STRUBLE, Associate Director HERBERT A. BIERN, Assistant Director ANTHONY G. CORNYN, Assistant Director JACK M. EGERTSON, Assistant Director ROBERT S. PLOTKIN, Assistant Director STEPHEN C. SCHEMERING, Assistant Director RICHARD SPILLENKOTHEN, Assistant Director SIDNEY M. SUSSAN, Assistant Director LAURA M. HOMER, Securities Credit Officer Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A71 and Official Staff EMMETT J. RICE MARTHA R. SEGER LYLE E. GRAMLEY OFFICE OF OFFICE OF STAFF DIRECTOR FOR STAFF DIRECTOR FOR MANAGEMENT FEDERAL RESERVE BANK ACTIVITIES S. DAVID FROST, Staff Director THEODORE E. ALLISON, Staff Director EDWARD T. MULRENIN, Assistant Staff Director JOSEPH W. DANIELS, SR., Advisor, Equal Employment WILLIAM R. JONES, Assistant Staff Director for Opportunity Programs Program Improvement Project STEPHEN R. MALPHRUS, Assistant Staff Director for Office Automation and Technology DIVISION OF FEDERAL RESERVE PORTIA W. THOMPSON, EEO Programs Officer BANK OPERATIONS CLYDE H. FARNSWORTH, JR., Director DIVISION OF DATA PROCESSING ELLIOTT C. MCENTEE, Associate Director DAVID L. ROBINSON, Associate Director CHARLES L. HAMPTON, Director C. WILLIAM SCHLEICHER, JR., Associate Director BRUCE M. BEARDSLEY, Deputy Director WALTER ALTHAUSEN, Assistant Director GLENN L. CUMMINS, Assistant Director CHARLES W. BENNETT, Assistant Director NEAL H. HILLERMAN, Assistant Director ANNE M. DEBEER, Assistant Director RICHARD J. MANASSERI, Assistant Director JACK DENNIS, JR., Assistant Director ELIZABETH B. RIGGS, Assistant Director EARL G. HAMILTON, Assistant Director WILLIAM C. SCHNEIDER, JR., Assistant Director * WILLIAM E. PASCOE, III, Assistant Director ROBERT J. ZEMEL, Assistant Director DIVISION OF PERSONNEL DAVID L. SHANNON, Director JOHN R. WEIS, Assistant Director CHARLES W. WOOD, Assistant Director OFFICE OF THE CONTROLLER GEORGE E. LIVINGSTON, Controller BRENT L. BOWEN, Assistant Controller DIVISION OF SUPPORT SERVICES ROBERT E. FRAZIER, Director WALTER W. KREIMANN, Associate Director GEORGE M. LOPEZ, Assistant Director *On loan from the Federal Reserve Bank of Richmond (Baltimore Branch). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Federal Reserve Bulletin • January 1985 Federal Open Market Committee FEDERAL OPEN MARKET COMMITTEE PAUL A. VOLCKER, Chairman ANTHONY M. SOLOMON, Vice Chairman EDWARD G. BOEHNE LYLE E. GRAMLEY J. CHARLES PARTEE ROBERT H. BOYKIN KAREN N. HORN EMMETT J. RICE E. GERALD CORRIGAN PRESTON MARTIN MARTHA R. SEGER HENRY C. WALLICH STEPHEN H. AXILROD, Staff Director and Secretary RICHARD G. DAVIS, Associate Economist NORMAND R.V. BERNARD, Assistant Secretary DONALD L. KOHN, Associate Economist NANCY M. STEELE, Deputy Assistant Secretary RICHARD W. LANG, Associate Economist MICHAEL BRADFIELD, General Counsel DAVID E. LINDSEY, Associate Economist JAMES H. OLTMAN, Deputy General Counsel MICHAEL J. PRELL, Associate Economist JAMES L. KICHLINE, Economist CHARLES J. SIEGMAN, Associate Economist EDWIN M. TRUMAN, Economist (International) GARY H. STERN, Associate Economist JOSEPH E. BURNS, Associate Economist JOSEPH S. ZEISEL, Associate Economist JOHN M. DAVIS, Associate Economist PETER D. STERNLIGHT, Manager for Domestic Operations, System Open Market Account SAM Y. CROSS, Manager for Foreign Operations, System Open Market Account FEDERAL ADVISORY COUNCIL JOHN G. MCCOY, President JOSEPH J. PINOLA, Vice President VINCENT C. BURKE, JR., N. BERNE HART, AND LEWIS T. PRESTON, Directors ROBERT L. NEWELL, First District BARRY F. SULLIVAN, Seventh District LEWIS T. PRESTON, Second District WILLIAM H. BOWEN, Eighth District GEORGE A. BUTLER, Third District E. PETER GILLETTE, JR., Ninth District JOHN G. MCCOY, Fourth District N. BERNE HART, Tenth District VINCENT C. BURKE, JR., Fifth District NAT S. ROGERS, Eleventh District PHILIP F. SEARLE, Sixth District JOSEPH J. PINOLA, Twelfth District HERBERT V. PROCHNOW, Secretary WILLIAM J. KORSVIK, Associate Secretary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A73 and Advisory Councils CONSUMER ADVISORY COUNCIL WILLARD P. OGBURN, Boston, Massachusetts, Chairman TIMOTHY D. MARRINAN, Minneapolis, Minnesota, Vice Chairman RACHEL G. BRATT, Medford, Massachusetts FREDERICK H. MILLER, Norman, Oklahoma GERALD R. CHRISTENSEN, Salt Lake City, Utah MARGARET M. MURPHY, Columbia, Maryland THOMAS L. CLARK, JR., New York, New York ROBERT F. MURPHY, Detroit, Michigan JEAN A. CROCKETT, Philadelphia, Pennsylvania LAWRENCE S. OKINAGA, Honolulu, Hawaii MEREDITH FERNSTROM, New York, New York ELVA QUIJANO, San Antonio, Texas ALLEN J. FISHBEIN, Washington, D.C. JANET J. RATHE, Portland, Oregon E.C.A. FORSBERG, SR., Atlanta, Georgia GLENDA G. SLOANE, Washington, D.C. STEVEN M. GEARY, Jefferson City, Missouri HENRY J. SOMMER, Philadelphia, Pennsylvania RICHARD F. HALLIBURTON, Kansas City, Missouri WINNIE F. TAYLOR, San Francisco, California CHARLES C. HOLT, Austin, Texas MICHAEL M. VAN BUSKIRK, Columbus, Ohio HARRY N. JACKSON, Minneapolis, Minnesota CLINTON WARNE, Cleveland, Ohio KENNETH V. LARKIN, San Francisco, California FREDERICK T. WEIMER, Chicago, Illinois MERVIN WINSTON, Minneapolis, Minnesota THRIFT INSTITUTIONS ADVISORY COUNCIL THOMAS R. BOMAR, Miami, Florida, President RICHARD H. DEIHL, LOS Angeles, California, Vice President JAMES A. ALIBER, Detroit, Michigan NORMAN M. JONES, Fargo, North Dakota GENE R. ARTEMENKO, Chicago, Illinois ROBERT R. MASTERTON, Portland, Maine J. MICHAEL CORNWALL, Dallas, Texas JOHN T. MORGAN, New York, New York JOHN R. EPPINGER, Villanova, Pennsylvania FRED A. PARKER, Monroe, North Carolina SARAH R. WALLACE, Newark, Ohio Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A74 Federal Reserve Board Publications Copies are available from PUBLICATIONS SERVICES, REPORT OF THE JOINT TREASURY-FEDERAL RESERVE STUDY Mail Stop 138, Board of Governors of the Federal Reserve OF THE U.S. GOVERNMENT SECURITIES MARKET. 1969. System, Washington, D.C. 20551. When a charge is indicat- 48 pp. $.25 each; 10 or more to one address, $.20 each. ed, remittance should accompany request and be made JOINT TREASURY-FEDERAL RESERVE STUDY OF THE GOVpayable to the order of the Board of Governors of the Federal ERNMENT SECURITIES MARKET; STAFF STUDIES—PART Reserve System. Remittance from foreign residents should 1, 1970. 86 pp. $.50 each; 10 or more to one address, $.40 be drawn on a U.S. bank. Stamps and coupons are not each. PART 2, 1971. Out of print. PART 3, 1973. 131 pp. accepted. $1.00; 10 or more to one address, $.85 each. REAPPRAISAL OF THE FEDERAL RESERVE DISCOUNT MECHA- THE FEDERAL RESERVE SYSTEM—PURPOSES AND FUNC- NISM. Vol. 1. 1971. 276 pp. Vol. 2. 1971. 173 pp. Vol. 3. TIONS. 1974. 125 pp. 1972. 220 pp. Each volume, $3.00; 10 or more to one ANNUAL REPORT. address, $2.50 each. FEDERAL RESERVE BULLETIN. Monthly. $20.00 per year or THE ECONOMETRICS OF PRICE DETERMINATION CONFER- $2.00 each in the United States, its possessions, Canada, ENCE, October 30-31, 1970, Washington, D.C. 1972. 397 and Mexico; 10 or more of same issue to one address, pp. Cloth ed. $5.00 each; 10 or more to one address, $18.00 per year or $1.75 each. Elsewhere, $24.00 per $4.50 each. Paper ed. $4.00 each; 10 or more to one year or $2.50 each. address, $3.60 each. BANKING AND MONETARY STATISTICS. 1914-1941. (Reprint FEDERAL RESERVE STAFF STUDY: WAYS TO MODERATE of Part I only) 1976. 682 pp. $5.00. FLUCTUATIONS IN HOUSING CONSTRUCTION. 1972. 487 BANKING AND MONETARY STATISTICS. 1941-1970. 1976. pp. $4.00 each; 10 or more to one address, $3.60 each. 1,168 pp. $15.00. LENDING FUNCTIONS OF THE FEDERAL RESERVE BANKS. ANNUAL STATISTICAL DIGEST 1973. 271 pp. $3.50 each; 10 or more to one address, 1971-75. 1976. 339 pp. $ 5.00 per copy. $3.00 each. 1972-76. 1977. 377 pp. $10.00 per copy. IMPROVING THE MONETARY AGGREGATES: REPORT OF THE 1973-77. 1978. 361 pp. $12.00 per copy. ADVISORY COMMITTEE ON MONETARY STATISTICS. 1974-78. 1980. 305 pp. $10.00 per copy. 1976. 43 pp. $1.00 each; 10 or more to one address, $.85 1970-79. 1981. 587 pp. $20.00 per copy. each. 1980. 1981. 241 pp. $10.00 per copy. IMPROVING THE MONETARY AGGREGATES: STAFF PAPERS. 1981. 1982. 239 pp. $ 6.50 per copy. 1978. 170 pp. $4.00 each; 10 or more to one address, 1982. 1983. 266 pp. $ 7.50 per copy. $3.75 each. 1983. 1984. 264 pp. $11.50 per copy. ANNUAL PERCENTAGE RATE TABLES (Truth in Lending— FEDERAL RESERVE CHART BOOK. Issued four times a year in Regulation Z) Vol. I (Regular Transactions). 1969. 100 February, May, August, and November. Subscription pp. Vol. II (Irregular Transactions). 1969. 116 pp. Each includes one issue of Historical Chart Book. $7.00 per volume $2.25; 10 or more of same volume to one year or $2.00 each in the United States, its possessions, address, $2.00 each. Canada, and Mexico. Elsewhere, $10.00 per year or FEDERAL RESERVE MEASURES OF CAPACITY AND CAPACITY $3.00 each. UTILIZATION. 1978. 40 pp. $1.75 each; 10 or more to one HISTORICAL CHART BOOK. Issued annually in Sept. Subscrip- address, $1.50 each. tion to the Federal Reserve Chart Book includes one THE BANK HOLDING COMPANY MOVEMENT TO 1978: A issue. $1.25 each in the United States, its possessions, COMPENDIUM. 1978. 289 pp. $2.50 each; 10 or more to Canada, and Mexico; 10 or more to one address, $1.00 one address, $2.25 each. each. Elsewhere, $1.50 each. 1977 CONSUMER CREDIT SURVEY. 1978. 119 pp. $2.00 each. SELECTED INTEREST AND EXCHANGE RATES—WEEKLY SE- FLOW OF FUNDS ACCOUNTS. 1949-1978. 1979. 171 pp. $1.75 RIES OF CHARTS. Weekly. $15.00 per year or $.40 each in each; 10 or more to one address, $1.50 each. the United States, its possessions, Canada, and Mexico; INTRODUCTION TO FLOW OF FUNDS. 1980. 68 pp. $1.50 each; 10 or more of same issue to one address, $13.50 per year 10 or more to one address, $1.25 each. or $.35 each. Elsewhere, $20.00 per year or $.50 each. PUBLIC POLICY AND CAPITAL FORMATION. 1981. 326 pp. THE FEDERAL RESERVE ACT, as amended through April 20, $13.50 each. 1983, with an appendix containing provisions of certain NEW MONETARY CONTROL PROCEDURES: FEDERAL REother statutes affecting the Federal Reserve System. 576 SERVE STAFF STUDY. 1981. pp. $7.00. SEASONAL ADJUSTMENT OF THE MONETARY AGGREGATES: REGULATIONS OF THE BOARD OF GOVERNORS OF THE FED- REPORT OF THE COMMITTEE OF EXPERTS ON SEASONAL ERAL RESERVE SYSTEM. ADJUSTMENT TECHNIQUES. 1981. 55 pp. $2.75 each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A75 FEDERAL RESERVE REGULATORY SERVICE. Looseleaf; updat- STAFF STUDIES.- Summaries Only Printed in the ed at least monthly. (Requests must be prepaid.) Bulletin Consumer and Community Affairs Handbook. $60.00 per Studies and papers on economic and financial subjects that year. are of general interest. Requests to obtain single copies of Monetary Policy and Reserve Requirements Handbook. the full text or to be added to the mailing list for the series $60.00 per year. may be sent to Publications Services. Securities Credit Transactions Handbook. $60.00 per year. Federal Reserve Regulatory Service. 3 vols. (Contains all three Handbooks plus substantial additional material.) 114. MULTIBANK HOLDING COMPANIES: RECENT EVI- $175.00 per year. DENCE ON COMPETITION AND PERFORMANCE IN Rates for subscribers outside the United States are as BANKING MARKETS, by Timothy J. Curry and John T. follows and include additional air mail costs: Rose. Jan. 1982. 9 pp. Federal Reserve Regulatory Service, $225.00 per year. 115. COSTS, SCALE ECONOMIES, COMPETITION, AND PROD- Each Handbook, $75.00 per year. UCT MIX IN THE U.S. PAYMENTS MECHANISM, by THE U.S. ECONOMY IN AN INTERDEPENDENT WORLD: A David B. Humphrey. Apr. 1982. 18 pp. MULTICOUNTRY MODEL, May 1984. 590 pp. $14.50 each. 116. DIVISIA MONETARY AGGREGATES: COMPILATION, WELCOME TO THE FEDERAL RESERVE. DATA, AND HISTORICAL BEHAVIOR, by William A. PROCESSING BANK HOLDING COMPANY AND MERGER APPLI- Barnett and Paul A. Spindt. May 1982. 82 pp. Out of CATIONS. print. CREDIT CARDS IN THE U.S. ECONOMY: THEIR IMPACT ON 117. THE COMMUNITY REINVESTMENT ACT AND CREDIT COSTS, PRICES, AND RETAIL SALES, July 1983. 114 pp. ALLOCATION, by Glenn Canner. June 1982. 8 pp. THE MONETARY AUTHORITY OF THE FEDERAL RESERVE, 118. INTEREST RATES AND TERMS ON CONSTRUCTION May 1984. (High School Level.) LOANS AT COMMERCIAL BANKS, by David F. Seiders. WRITING IN STYLE AT THE FEDERAL RESERVE. August 1984. July 1982. 14 pp. 93 pp. $2.50 each. 119. STRUCTURE-PERFORMANCE STUDIES IN BANKING: AN UPDATED SUMMARY AND EVALUATION, by Stephen A. Rhoades. Aug. 1982. 15 pp. 120. FOREIGN SUBSIDIARIES OF U.S. BANKING ORGANIZA- TIONS, by James V. Houpt and Michael G. Martinson. Oct. 1982. 18 pp. Out of print. CONSUMER EDUCATION PAMPHLETS 121. REDLINING: RESEARCH AND FEDERAL LEGISLATIVE Short pamphlets suitable for classroom use. Multiple copies RESPONSE, by Glenn B. Canner. Oct. 1982. 20 pp. available without charge. 122. BANK CAPITAL TRENDS AND FINANCING, by Samuel H. Talley. Feb. 1983. 19 pp. Out of print. 123. FINANCIAL TRANSACTIONS WITHIN BANK HOLDING Alice in Debitland COMPANIES, by John T. Rose and Samuel H. Talley. Consumer Handbook to Credit Protection Laws May 1983. 11 pp. The Equal Credit Opportunity Act and . . . Age 124. INTERNATIONAL BANKING FACILITIES AND THE EU- The Equal Credit Opportunity Act and . . . Credit Rights in RODOLLAR MARKET, by Henry S. Terrell and Rodney Housing H. Mills. August 1983. 14 pp. The Equal Credit Opportunity Act and . . . Doctors, Law- 125. SEASONAL ADJUSTMENT OF THE WEEKLY MONETARY yers, Small Retailers, and Others Who May Provide Inci- AGGREGATES: A MODEL-BASED APPROACH, by David dental Credit A. Pierce, Michael R. Grupe, and William P. Cleve- The Equal Credit Opportunity Act and . . . Women land. August 1983. 23 pp. Fair Credit Billing 126. DEFINITION AND MEASUREMENT OF EXCHANGE MAR- Federal Reserve Glossary KET INTERVENTION, by Donald B. Adams and Dale Guide to Federal Reserve Regulations W. Henderson. August 1983. 5 pp. How to File A Consumer Credit Complaint 127. U.S. EXPERIENCE WITH EXCHANGE MARKET INTER- If You Borrow To Buy Stock VENTION: JANUARY-MARCH 1975, by Margaret L. If You Use A Credit Card Greene. August 1984. 16 pp. Instructional Materials of the Federal Reserve System 128. U.S. EXPERIENCE WITH EXCHANGE MARKET INTER- Series on the Structure of the Federal Reserve System VENTION: SEPTEMBER 1977-OcTOBER 1981, by Marga- The Board of Governors of the Federal Reserve System ret L. Greene. 40 pp. The Federal Open Market Committee 129. U.S. EXPERIENCE WITH EXCHANGE MARKET INTER- Federal Reserve Bank Board of Directors VENTION: OCTOBER 1980-OcTOBER 1981, by Margaret Federal Reserve Banks L. Greene. August 1984. 36 pp. Monetary Control Act of 1980 130. EFFECTS OF EXCHANGE RATE VARIABILITY ON IN- Organization and Advisory Committees TERNATIONAL TRADE AND OTHER ECONOMIC VARIA- Truth in Leasing BLES: A REVIEW OF THE LITERATURE, by Victoria S. U.S. Currency Farrell with Dean A. DeRosa and T. Ashby McCown. What Truth in Lending Means to You January 1984. 21 pp. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A76 132. TIME-SERIES STUDIES OF THE RELATIONSHIP BE- REPRINTS OF BULLETIN ARTICLES TWEEN EXCHANGE RATES AND INTERVENTION: A Most of the articles reprinted do not exceed 12 pages. REVIEW OF THE TECHNIQUES AND LITERATURE, by Kenneth Rogoff. October 1983. 15 pp. 133. RELATIONSHIPS AMONG EXCHANGE RATES, INTER- Survey of Finance Companies. 1980. 5/81. VENTION, AND INTEREST RATES: AN EMPIRICAL IN- Bank Lending in Developing Countries. 9/81. VESTIGATION, by Bonnie E. Loopesko. November The Commercial Paper Market since the Mid-Seventies. 6/82. 1983. 20 pp. Applying the Theory of Probable Future Competition. 9/82. 134. SMALL EMPIRICAL MODELS OF EXCHANGE MARKET International Banking Facilities. 10/82. INTERVENTION: A REVIEW OF THE LITERATURE, by New Federal Reserve Measures of Capacity and Capacity Ralph W. Tryon. October 1983. 14 pp. Utilization. 7/83. *135. SMALL EMPIRICAL MODELS OF EXCHANGE MARKET Foreign Experience with Targets for Money Growth. 10/83. INTERVENTION: APPLICATIONS TO CANADA, GERMA- Intervention in Foreign Exchange Markets: A Summary of NY, AND JAPAN, by Deborah J. Danker, Richard A. Ten Staff Studies. 11/83. Haas, Dale W. Henderson, Steven A. Symansky, and A Financial Perspective on Agriculture. 1/84. Ralph W. Tryon. U.S. International Transactions in 1983. 4/84. 136. THE EFFECTS OF FISCAL POLICY ON THE U.S. ECONO- Survey of Consumer Finances, 1983. 9/84. MY, by Darrell Cohen and Peter B. Clark. January Bank Lending to Developing Countries. 10/84. 1984. 16 pp. 137. THE IMPLICATIONS FOR BANK MERGER POLICY OF FINANCIAL DEREGULATION, INTERSTATE BANKING, AND FINANCIAL SUPERMARKETS, by Stephen A. Rhoades. February 1984. 8 pp. 138. ANTITRUST LAWS, JUSTICE DEPARTMENT GUIDE- LINES, AND THE LIMITS OF CONCENTRATION IN LO- CAL BANKING MARKETS, by James Burke. June 1984. 14 pp. 139. SOME IMPLICATIONS OF FINANCIAL INNOVATIONS IN THE UNITED STATES, by Thomas D. Simpson and Patrick M. Parkinson. August 1984. 20 pp. 140. GEOGRAPHIC MARKET DELINEATION: A REVIEW OF THE LITERATURE, by John D. Wolken. November 1984. 38 pp. 141. A COMPARISON OF DIRECT DEPOSIT AND CHECK PAY- MENT COSTS, by William Dudley. November 1984. 15 pp. *The availability of this study will be announced in a forthcoming BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A77 Index to Statistical Tables References are to pages A3 through A68 although the prefix 'A" is omitted in this index ACCEPTANCES, bankers (See Bankers acceptances) Demand deposits—Continued Agricultural loans, commercial banks, 19, 20, 25 Ownership by individuals, partnerships, and Assets and liabilities (See also Foreigners) corporations, 23 Banks, by classes, 18-20 Turnover, 15 Domestic finance companies, 38 Depository institutions Federal Reserve Banks, 10 Reserve requirements, 7 Financial institutions, 28 Reserves and related items, 3, 4, 5, 12 Foreign banks, U.S. branches and agencies, 22 Deposits (See also specific types) Nonfinancial corporations, 37 Banks, by classes, 3, 18-20, 21, 22 Automobiles Federal Reserve Banks, 4, 10 Consumer installment credit, 41, 42 Turnover, 15 Production, 47, 48 Discount rates at Reserve Banks and at foreign central banks (See Interest rates) BANKERS acceptances, 9, 24, 26 Discounts and advances by Reserve Banks (See Loans) Bankers balances, 18-20 (See also Foreigners) Dividends, corporate, 37 Bonds (See also U.S. government securities) New issues, 36 EMPLOYMENT, 45 Rates, 26 Eurodollars, 26 Branch banks, 22, 55 Business activity, nonfinancial, 45 Business expenditures on new plant and equipment, 38 FARM mortgage loans, 40 Business loans (See Commercial and industrial loans) Federal agency obligations, 4, 9, 10, 11, 33, 34 Federal credit agencies, 35 CAPACITY utilization, 46 Federal finance Capital accounts Debt subject to statutory limitation, and types and Banks, by classes, 18 ownership of gross debt, 32 Federal Reserve Banks, 10 Receipts and outlays, 30, 31 Central banks, discount rates, 67 Treasury financing of surplus, or deficit, 30 Certificates of deposit, 26 Treasury operating balance, 30 Commercial and industrial loans Federal Financing Bank, 30, 35 Commercial banks, 16, 21, 25 Federal funds, 5, 17, 19, 20, 22, 26, 30 Weekly reporting banks, 19-22 Federal Home Loan Banks, 35 Commercial banks Federal Home Loan Mortgage Corporation, 35, 39, 40 Assets and liabilities, 18-20 Federal Housing Administration, 35, 39, 40 Business loans, 25 Federal Land Banks, 40 Commercial and industrial loans, 16, 21, 22, 25 Federal National Mortgage Association, 35, 39, 40 Consumer loans held, by type, and terms, 41, 42 Federal Reserve Banks Loans sold outright, 21 Condition statement, 10 Nondeposit fund, 17 Discount rates (See Interest rates) Number, by classes, 18 U.S. government securities held, 4, 10, 11, 32 Real estate mortgages held, by holder and property, 40 Federal Reserve credit, 4, 5, 10, 11 Time and savings deposits, 3 Federal Reserve notes, 10 Commercial paper, 24, 26, 38 Federally sponsored credit agencies, 35 Condition statements (See Assets and liabilities) Finance companies Construction, 45, 49 Assets and liabilities, 38 Consumer installment credit, 41, 42 Business credit, 38 Consumer prices, 45, 50 Loans, 19, 41, 42 Consumption expenditures, 51, 52 Paper, 24, 26 Corporations Financial institutions Profits and their distribution, 37 Loans to, 19, 20, 22 Security issues, 36, 65 Selected assets and liabilities, 28 Cost of living (See Consumer prices) Float, 4 Credit unions, 28, 41 (See also Thrift institutions) Flow of funds, 43, 44 Currency and coin, 18 Foreign banks, assets and liabilities of U.S. branches and Currency in circulation, 4, 13 agencies, 22 Customer credit, stock market, 27 Foreign currency operations, 10 Foreign deposits in U.S. banks, 4, 10, 19, 20 DEBITS to deposit accounts, 15 Foreign exchange rates, 68 Debt (See specific types of debt or securities) Foreign trade, 54 Demand deposits Foreigners Adjusted, commercial banks, 15 Claims on, 55, 57, 60, 61, 62, 64 Banks, by classes, 18-20, 22 Liabilities to, 20, 54, 55, 57, 58, 63, 65, 66 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A78 GOLD REAL estate loans Certificate account, 10 Banks, by classes, 16, 19, 20, 40 Stock, 4, 54 Financial institutions, 28 Government National Mortgage Association, 35, 39, 40 Terms, yields, and activity, 39 Gross national product, 51 Type of holder and property mortgaged, 40 Repurchase agreements, 5, 17, 19, 20, 22 HOUSING, new and existing units, 49 Reserve requirements, 7 Reserves Commercial banks, 18 INCOME, personal and national, 45, 51, 52 Depository institutions, 3, 4, 5, 12 Industrial production, 45, 47 Federal Reserve Banks, 10 Installment loans, 41, 42 U.S. reserve assets, 54 Insurance companies, 28, 32, 40 Residential mortgage loans, 39 Interest rates Retail credit and retail sales, 41, 42, 45 Bonds, 26 Business loans of banks, 25 Federal Reserve Banks, 6 SAVING Foreign central banks and foreign countries, 67 Flow of funds, 43, 44 National income accounts, 51, 52 Money and capital markets, 26 Savings and loan associations, 8, 28, 40, 41, 43 (See also Mortgages, 39 Thrift institutions) Prime rate, commercial banks, 24 Savings deposits (See Time and savings deposits) Time and savings deposits, 8 Securities (See specific types) International capital transactions of United States, 53-66 Federal and federally sponsored credit agencies, 35 International organizations, 57, 58-60, 63-66 Foreign transactions, 65 Inventories, 51 New issues, 36 Investment companies, issues and assets, 37 Prices, 27 Investments (See also specific types) Special drawing rights, 4, 10, 53, 54 Banks, by classes, 18, 19, 20, 28 State and local governments Commercial banks, 3, 16, 18-20, 21, 40 Deposits, 19, 20 Federal Reserve Banks, 10, 11 Financial institutions, 28, 40 Holdings of U.S. government securities, 32 New security issues, 36 Ownership of securities issued by, 19, 20, 28 LABOR force, 45 Rates on securities, 26 Life insurance companies (See Insurance companies) Stock market, 27 Loans (See also specific types) Stocks (See also Securities) Banks, by classes, 18-20 New issues, 36 Commercial banks, 3, 16, 18-20, 21, 25 Prices, 27 Federal Reserve Banks, 4, 5, 6, 10, 11 Financial institutions, 28, 40 Student Loan Marketing Association, 35 Insured or guaranteed by United States, 39, 40 TAX receipts, federal, 31 MANUFACTURING Thrift institutions, 3 (See also Credit unions, Mutual Capacity utilization, 46 savings banks, and Savings and loan associations) Production, 45, 48 Time and savings deposits, 3, 8, 13, 17, 18, 21, 22 (See also Margin requirements, 27 Transaction and Nontransaction balances) Member banks (See also Depository institutions) Trade, foreign, 54 Federal funds and repurchase agreements, 5 Transaction balances, 13, 19, 20 Reserve requirements, 7 Treasury currency, Treasury cash, 4 Mining production, 48 Treasury deposits, 4, 10, 30 Mobile homes shipped, 49 Treasury operating balance, 30 Monetary and credit aggregates, 3, 12 UNEMPLOYMENT, 45 Money and capital market rates (See Interest rates) U.S. government balances Money stock measures and components, 3,13 Commercial bank holdings, 18, 19, 20 Mortgages (See Real estate loans) Treasury deposits at Reserve Banks, 4, 10, 30 Mutual funds (See Investment companies) U.S. government securities Mutual savings banks, 8, 28, 40, 41 (See also Thrift Bank holdings, 17, 18-20, 22, 32 institutions) Dealer transactions, positions, and financing, 34 Federal Reserve Bank holdings, 4, 10, 11, 32 NATIONAL defense outlays, 31 Foreign and international holdings and transactions, 10, National income, 51 32, 66 Nontransaction balances, 3, 13, 19, 20, 21 Open market transactions, 9 Outstanding, by type and holder, 28, 32 OPEN market transactions, 9 Rates, 26 U.S. international transactions, 53-66 Utilities, production, 48 PERSONAL income, 52 Prices Consumer and producer, 45, 50 VETERANS Administration, 39, 40 Stock market, 27 Prime rate, commercial banks, 24 WEEKLY reporting banks, 19-22 Producer prices, 45, 50 Wholesale (producer) prices, 45, 50 Production, 45, 47 Profits, corporate, 37 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A79 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 P. Henderson Frank E. Morris Thomas I. Atkins Robert W. Eisenmenger NEW YORK* 10045 John Brademas E. Gerald Corrigan Gertrude G. Michelson Thomas M. Timlen Buffalo 14240 M. Jane Dickman John T. Keane PHILADELPHIA 19105 Robert M. Landis Edward G. Boehne Nevius M. Curtis Richard L. Smoot CLEVELAND* 44101 William H. Knoell Karen N. Horn E. Mandell de Windt William H. Hendricks Cincinnati 45201 Robert E. Boni Charles A. Cerino Pittsburgh 15230 Milton G. Hulme, Jr. Harold J. Swart RICHMOND* 23219 William S. Lee Robert P. Black Leroy T. Canoles, Jr. Jimmie R. Monhollon Baltimore 21203 Robert L. Tate Robert D. McTeer, Jr. Charlotte 28230 Henry Ponder Albert D. Tinkelenberg Culpeper Communications John G. Stoides and Records Center 22701 ATLANTA 30301 John H. Weitnauer, Jr. Robert P. Forrestal Bradley Currey, Jr. Jack Guynn Birmingham 35283 Martha A. Mclnnis Fred R. Hen- Jacksonville 32231 Jerome P. Keuper James D. Hawkins Miami 33152 Sue McCourt Cobb Patrick K. Barron Nashville 37203 C. Warren Neel Jeffrey J. Wells New Orleans 70161 Sharon A. Perlis Henry H. Bourgaux CHICAGO* 60690 Stanton R. Cook Silas Keehn Edward F. Brabec Daniel M. Doyle Detroit 48231 Russell G. Mawby Roby L. Sloan ST. LOUIS 63166 W.L. Hadley Griffin Vacancy Mary P. Holt Joseph P. Garbarini Little Rock 72203 Sheffield Nelson John F. Breen Louisville 40232 Sister Eileen M. Egan James E. Conrad Memphis 38101 Patricia W. Shaw Paul I. Black, Jr. MINNEAPOLIS 55480 William G. Phillips Vacancy John B. Davis, Jr. Thomas E. Gainor Helena 59601 Ernest B. Corrick Robert F. McNellis KANSAS CITY 64198 Doris M. Drury Roger Guffey Irvine O. Hockaday, Jr. Henry R. Czerwinski Denver 80217 James E. Nielson Wayne W. Martin Oklahoma City 73125 Patience Latting William G. Evans Omaha 68102 Robert G. Lueder Robert D. Hamilton DALLAS 75222 Robert D. Rogers Robert H. Boykin John V. James William H. Wallace El Paso 79999 Mary Carmen Saucedo Joel L. Koonce, Jr. Houston 77252 Paul N. Howell J.Z. Rowe San Antonio 78295 Lawrence L. Crum Thomas H. Robertson SAN FRANCISCO 94120 Caroline L. Ahmanson John J. Balles Alan C. Furth Richard T. Griffith Los Angeles 90051 Bruce M. Schwaegler Richard C. Dunn Portland 97208 Paul E. Bragdon Angelo S. Carella Salt Lake City 84125 Wendell J. Ashton A. Grant Holman Seattle 98124 John W. Ellis 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

A80 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories LEGEND —— Boundaries of Federal Reserve Districts ® Federal Reserve Bank Cities Boundaries of Federal Reserve Branch * Federal Reserve Branch Cities Territories Federal Reserve Bank Facility Q Board of Governors of the Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Publications of Interest FEDERAL RESERVE CONSUMER CREDIT sumer credit protections. This 44-page booklet ex- PUBLICATIONS plains how to use the credit laws to shop for credit, apply for it, keep up credit ratings, and complain about an unfair deal. The Federal Reserve Board publishes a series of Protections offered by the Electronic Fund Transfer pamphlets covering individual credit laws and topics, Act are explained in Alice in Debitland. This booklet as pictured below. The series includes such subjects as offers tips for those using the new "paperless" syshow the Equal Credit Opportunity Act protects wom- tems for transferring money. en against discrimination in their credit dealings, how Copies of consumer publications are available free to use a credit card, and how to use Truth in Lending of charge from Publications Services, Mail Stop 138, information to compare credit costs. Board of Governors of the Federal Reserve System, The Board also publishes the Consumer Handbook Washington, D.C. 20551. Multiple copies for classto Credit Protection Laws, a complete guide to con- room use are also available free of charge. IMS3 LMMO The Equal Credit LMMO Opportunity Act LE4SINO and ... LE4SNG TRUTH IN LE4SING What If Ihithln You Lending Borrow Means To Buy To You Stock— YOU USE A CREDIT CARD Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Publications of Interest FEDERAL RESERVE REGULATORY SERVICE The Securities Credit Transactions Handbook contains Regulations G, T, U, and X, dealing with exten- To promote public understanding of its regulatory sions of credit for the purchase of securities, together functions, the Board publishes the Federal Reserve with all related statutes, Board interpretations, rul- Regulatory Service, a three-volume looseleaf service ings, and staff opinions. Also included is the Board's containing all Board regulations and related statutes, list of OTC margin stocks. interpretations, policy statements, rulings, and staff The Consumer and Community Affairs Handbook opinions. For those with a more specialized interest in contains Regulations B, C, E, M, Z, AA, and BB and the Board's regulations, parts of this service are associated materials. published separately as handbooks pertaining to mon- For domestic subscribers, the annual rate is $175 for etary policy, securities credit, and consumer affairs. the Federal Reserve Regulatory Service and $60 for These publications are designed to help those who each handbook. For subscribers outside the United must frequently refer to the Board's regulatory materi- States, the price including additional air mail costs is als. They are updated at least monthly, and each $225 for the Service and $75 for each Handbook. All contains conversion tables, citation indexes, and a subscription requests must be accompanied by a check subject index. or money order payable to Board of Governors of the The Monetary Policy and Reserve Requirements Federal Reserve System. Orders should be addressed Handbook contains Regulations A, D, and Q plus to Publications Services, Mail Stop 138, Federal Rerelated materials. For convenient reference, it also serve Board, 20th Street and Constitution Avenue, contains the rules of the Depository Institutions N.W., Washington, D.C. 20551. Deregulation Committee. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis