Federal Reserve Bulletin, 1990-02

VOLUME 76 • NUMBER 2 • FEBRUARY 1990 FEDERAL RESERVE BULLETIN BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, D.C. PUBLICATIONS COMMITTEE Joseph R. Coyne, Chairman • S. David Frost • Griffith L. Garwood • Donald L. Kohn • J. Virgil Mattingly, Jr. • Michael J. Prell • Edwin M. Truman 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 Section headed by Mendelle T. Berenson, the Graphic Communications Section under the direction of Peter G. Thomas, and Publications Services supervised by Linda C. Kyles. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Table of Contents 39 THE ACTIVITIES OF JAPANESE BANKS 55 RECORD OF POLICY ACTIONS OF THE IN THE UNITED KINGDOM AND IN THE FEDERAL OPEN MARKET COMMITTEE UNITED STATES, 1980-88 At its meeting on November 14, 1989, the A large proportion of the international as- Committee adopted a directive that called sets of Japanese banks are at their branches for maintaining the existing degree of presin the United Kingdom and their agency sure on reserve positions and that provided and branch offices in the United States. for giving greater weight to developments This article focuses on the activities of that might require some slight easing during Japanese banks in these two centers. the intermeeting period. Accordingly, slightly greater reserve restraint might be acceptable during the intermeeting period, while some slight easing of reserve restraint would be acceptable, depending on prog- 51 INDUSTRIAL PRODUCTION ress toward price stability, the strength of Industrial production edged up in Novem- the business expansion, the behavior of the ber after revised declines of 0.6 percent in monetary aggregates, and developments in October and 0.3 percent in September. foreign exchange and domestic financial markets. The reserve conditions contemplated by the Committee were expected to be consistent with growth of M2 and M3 at annual rates of around IVi percent and 4'/2 53 ANNOUNCEMENTS percent respectively over the three-month Statement by Chairman Greenspan on the period from September to December. The nomination of David Mullins. intermeeting range for the federal funds rate was left unchanged at 7 to 11 percent. Amendments to Regulation B. Amendments to Regulation C. Decrease in the net transaction accounts to 61 LEGAL DEVELOPMENTS which a 3 percent reserve requirement will Various bank holding company, bank serapply in 1990. vice corporation, and bank merger orders; Proposed revisions to the staff commentary and pending cases. on Regulation B; proposed amendments to Regulation CC; proposed modifications to the notice of nonpayment service; proposed preemption determination regarding a Cali- AI FINANCIAL AND BUSINESS STATISTICS fornia law; proposal to revoke current ex- These tables reflect data available as of emptions from Regulation C granted to in- December 27, 1989. stitutions in Massachusetts, Connecticut, and New Jersey; proposed transition capital A3 Domestic Financial Statistics standards for state member banks and bank A46 Domestic Nonfinancial Statistics holding companies through the end of 1990. A55 International Statistics Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A7l GUIDE TO TABULAR PRESENTATION, A84 FEDERAL RESERVE BOARD STATISTICAL RELEASES, AND SPECIAL PUBLICATIONS TABLES A86 INDEX TO STATISTICAL TABLES A80 BOARD OF GOVERNORS AND STAFF A88 FEDERAL RESERVE BANKS, BRANCHES, AND OFFICES A82 FEDERAL OPEN MARKET COMMITTEE AND STAFF; ADVISORY COUNCILS A89 MAP OF FEDERAL RESERVE SYSTEM Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Activities of Japanese Banks in the United Kingdom and in the United States, 1980^88 This article was prepared by Henry S. Terrell, An earlier paper analyzed the faster world- Division of International Finance, Board of Gov- wide growth of assets of the Japanese banks ernors of the Federal Reserve System; Robert S. relative to U.S. banks over the longer period Dohner, Visiting Professor, Graduate School of from 1972 through 1986.3 The major finding of Business, Stanford University; and Barbara R. that study was that domestic currency activities Lowrey, Associate Secretary, Board of Gover- in Japan accounted for a large proportion of the nors. total growth of assets of Japanese banks in that period. In the 1984-86 period, when assets at In recent years banks headquartered in Japan large Japanese banks increased about 75 perhave grown extremely rapidly relative to banks cent more than assets at large U.S. banks, headquartered in other countries. While most of roughly four-fifths of this growth differential this growth occurred at their domestic offices, appeared related to the domestic banking busiinternational assets of Japanese banks also grew ness of Japanese banks and only about one-fifth substantially. Between year-end 1984 and yearto their international business. Factors that end 1988, Japanese banks accounted for slightly influenced the rapid domestic asset growth, more than one-half of the measured growth of measured in U.S. dollars, were a fast growing total international banking activity. International domestic economy, the translation effect of an assets of Japanese banks currently represent appreciating currency on the value of yenabout two-fifths of measured international bankdenominated assets at domestic offices, and the ing assets of all banks. A large portion of these ability of large Japanese banks to maintain their international assets of Japanese banks are at their share of the domestic banking market during a branches in the United Kingdom and their period when the largest U.S. banks were losing agency and branch offices in the United States. domestic market share to the rapidly growing According to a recent survey, sixteen of the superregional banks. world's twenty-five largest banks, including the The financial strength and competitive posiseven largest, are headquartered in Japan.1 tion of Japanese banks in addition to their When measured by total market capitalization, absolute size has made them a major presence the figures are even more striking. The average in overseas markets as well as in their domestic equity market value of shares of the largest market. The distinction between domestic and Japanese banks is in a range of $50 billion to $80 international banking activity, however, is not billion, while the average stock market valuation always precise, particularly in a world without of the equity of the largest U.S. banks is about capital controls. In such an environment, large $10 billion.2 multinational banks are managed on a worldwide consolidated basis and have the ability to Note. This article is based on an earlier study by the same shift both assets and funding sources to markets authors, "The U.S. and U.K. Activities of Japanese Banks: that offer greater economic advantages or are 1980-1988," International Finance Discussion Papers 361 (Board of Governors of the Federal Reserve System, Division of International Finance, September 1989). 3. See Robert S. Dohner and Henry S. Terrell, "The 1. Annual survey, "Top 1,000 World Banks," The Banker, Determinants of the Growth of Multinational Banking Orgavol. 139 (July 1989), pp. 38-145. nizations: 1972-86," International Finance Discussion Pa- 2. See Salomon Brothers, International Bank Biweekly, pers 326 (Board of Governors of the Federal Reserve System, August 2, 1989. Division of International Finance, June 1988). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

40 Federal Reserve Bulletin • February 1990 1. Location of assets of Japanese banks office assets between December 1981 and De- Billions of dollars, except as noted cember 1984 (81 percent compared with 17 percent), in large part because of the translation Foreign branches YYeeaarr eennddiinngg OOffffiicceess effect of the decline in the value of the Japanese DDeecceemmbbeerr iinn JJaappaann11 Total K U in n g i d te o d m S U t n a i t t e e s d 2 yen relative to the U.S. dollar on the dollar value of the yen assets of the banks' domestic 1981 791 233 134 74 offices. 1982 811 310 161 97 1983 908 350 178 108 By contrast, between year-end 1984 and year- 1984 926 421 194 131 1985 1,339 600 257 151 end 1988, the dollar value of assets of foreign 1986 1,927 837 359 208 1987 2,854 1,090 426 252 branches of Japanese banks increased 166 per- 1988 3,044 1,120 445 307 cent while the dollar value of domestic office Percentage increase assets of Japanese banks increased 229 percent, 1981-88 285 381 232 315 1984-88 229 166 129 134 in light of an appreciation of the Japanese yen. Although less rapid than the growth of domestic 1. Includes assets of city, trust, and long-term credit banks in Japan. 2. Includes agencies as well as branches of Japanese banks. offices, growth of offshore branches in this period SOURCES . Bank of Japan, Economic Statistics Monthly; Call Report Data for was extremely rapid relative to the growth of U.S. Agencies and Branches; and Bank of England Quarterly. international assets of other countries' banks. Part of this growth reflects the progressive liberless regulated. To the extent that any national alization of the ability of Japanese banks to banking group shifts its domestic assets, includ- acquire foreign assets. ing interbank trading, to offshore markets be- This relatively faster growth of offshore activcause of regulations in its domestic market, its ities of Japanese banks compared with that of measured participation in "international" other banks is shown in table 2, which presents banking assets will be increased even though data on the share of total international assets by the transactions have a definite domestic orien- nationality of bank. Between year-end 1984 and tation. year-end 1988, international assets at Japanese Assets of all foreign branches of Japanese banks more than tripled, and the share of Japabanks, of which those in the United States and nese banks in total international banking assets the United Kingdom account for nearly three- increased from less than 25 percent in 1984 to fourths of the total, increased about 380 percent almost 40 percent by year-end 1988. Internabetween December 1981 and year-end 1988, tional assets of Japanese banks were estimated to while aggregate domestic office assets increased be more than two and one-half times as large as about 285 percent (table 1). Foreign branch international assets of U.S. banks, the second assets grew substantially more than domestic largest national group. Over this four-year pe- 2. International bank assets, by nationality of bank1 Amounts in billions of dollars; shares in percent December 1984 December 1986 December 1988 PPaarreenntt ccoouunnttrryy ooff bbaannkk Share of Share of Share of Amount Amount Amount total assets total assets total assets France 200.7 8.9 276.1 8.1 384.1 8.4 Germany 143.2 6.4 270.0 7.9 358.8 7.7 Italy 90.6 4.0 145.1 4.3 201.2 4.4 Japan2 517.9 23.0 1,117.7 32.8 1,756.4 38.2 Switzerland 82.9 3.7 152.0 4.5 238.6 5.2 United Kingdom 168.9 7.5 211.7 6.2 238.7 5.2 United States .. 594.5 26.4 598.3 17.6 675.3 14.6 Other 450.7 20.1 635.4 18.6 749.8 16.3 Total 2,249.4 100.0 3,406.3 100.0 4,597.8 100.0 1. Includes claims in foreign and domestic currencies of banking offices on and are therefore larger than the totals reported in table 1 for assets at foreign nonlocal customers and claims in foreign currencies on local residents. branches. 2. These data include international assets at domestic (Japanese) offices and SOURCES. Bank for International Settlements, Annual Reports, various foreign subsidiaries in addition to assets at foreign branches of Japanese banks issues. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The U.K. and U.S. Activities of Japanese Banks, 1980-88 41 riod, Japanese banks are estimated to have ac- ACTIVITIES OF JAPANESE BANKS IN THE counted for approximately one-half of the growth TWO CENTERS: AN OVERVIEW of total international banking activity. In summary, in recent years Japanese banks have become the world's largest banks in abso- Activities in the United Kingdom lute size. Although most of their absolute growth has occurred at their offices in Japan, Japanese In considering summary data on the assets of the banks did account for about one-half of the U.K. branches of Japanese banks, several facts growth of total international banking assets in the stand out (see table 3). About nine-tenths of the total 1984-88 period, and a large proportion of their assets of Japanese banks are denominated in curreninternational assets are concentrated at their cies other than sterling. Of that total, more than branch offices in the United States and in the three-fourths are either claims on overseas residents United Kingdom. In both markets, Japanese or Eurocurrency claims on banks domiciled in the banks have grown rapidly and are by far the United Kingdom. Almost one-half of Japanese largest foreign banks. As of December 1988, banks' total claims on overseas residents represent Japanese banks accounted for about one-half of claims on affiliated offices in other countries. These the activities of foreign banks in the United data confirm anecdotal evidence that little of the States and for about two-fifths of foreign bank activity of Japanese banks in the United Kingdom is activity in London. This article will explore the oriented toward the U.K. economy. Since year-end extent to which the growth of assets of U.K. and 1984, the nonsterling claims of these branches on of U.S. branches of Japanese banks are related to private U.K. firms have increased (in dollar terms) local market conditions or to the overall growth three-fold, but a large proportion of these claims are of Japanese international trade and investment. on financial affiliates of foreign companies based in In addition, the article examines whether these the United Kingdom. Such firms include life insurbranches are substitutes for head offices in ex- ance companies that conduct a multinational busitending commercial and industrial loans to Ja- ness in London and therefore are not closely linked pan-based companies and in engaging in inter- to the local economy. bank trading activities that might have taken A roughly similar pattern regarding the busiplace in Japan had the domestic market been less ness orientation of Japanese banks is apparent on regulated. It will also analyze, in the context of a the liabilities side (table 4). Virtually all the statistical model, some of the factors that have funding for the U.K. branches of Japanese banks affected the activities of Japanese banks in these comes from nonsterling transactions with overtwo centers. seas residents, Eurocurrency liabilities to local 3. Assets of U. K. branches of Japanese banks Billions of dollars Assets Nonsterling claims YYYeeeaaarrr eeennndddiiinnnggg DDeennoommiinnaatteedd On overseas residents On U.K. residents DDDeeeccceeemmmbbbeeerrr iinn ccuurrrreenncciieess TToottaall ootthheerr tthhaann Unrelated Related Monetary Private sstteerrlliinngg11 Total banks offices | Nonbanks sector sector 1980 97.6 94.8 70.4 24.8 32.7 12.9 22.4 2.5 1981 134.1 129.7 91.8 35.4 39.2 17.3 33.9 3.7 1982 160.8 155.1 106.6 47.7 37.6 21.3 44.1 4.2 1983 178.4 171.1 117.8 51.9 42.5 23.4 39.8 5.1 1984 194.1 182.9 137.0 63.0 51.3 22.7 34.6 6.1 1985 257.3 241.1 167.8 71.6 72.6 23.6 41.5 10.0 1986 358.6 336.3 247.4 93.8 125.0 28.6 44.5 14.7 1987 426.0 389.1 298.8 113.7 149.4 35.7 38.4 20.9 1988 444.6 393.8 307.2 127.0 143.2 37.0 37.5 21.5 1. Difference between total and nonsterling assets does not equal sterling SOURCE. Bank of England Quarterly and special tabulations provided by the assets because of a small amount of unallocated items. Bank of England. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

42 Federal Reserve Bulletin • February 1990 4. Liabilities of U.K. branches of Japanese banks Billions of dollars Liabilities Nonsterling liabilities YYYeeeaaarrr eeennndddiiinnnggg DDeennoommiinnaatteedd To overseas residents DDDeeeccceeemmmbbbeeerrr TToottaall iinn ccuurrrreenncciieess mmoo UU nn .. ee KK ttaa .. rryy CCDDss22 oo ss tt tt hh ee ee rr rr ll ii tt nn hh gg aa 11 nn Total Un b r a e n la k t s e d R o e ff la ic t e e s d Nonbanks sseeccttoorr 1980 97.6 94.8 57.8 n.a. 16.5 n.a. 27.3 9.0 1981 134.1 129.7 77.1 n.a. 23.0 n.a. 39.4 12.1 1982 160.8 155.2 91.1 60.0 24.9 6.2 48.3 19.0 1983 178.4 171.4 98.8 63.4 27.3 8.1 42.5 29.9 1984 194.1 183.7 118.2 82.6 25.8 9.8 37.6 32.5 1985 257.3 240.6 157.6 108.6 37.3 11.7 52.7 29.1 1986 358.6 335.8 225.5 141.2 67.9 16.4 59.3 45.4 1987 426.0 388.0 260.7 160.5 82.4 17.8 60.1 59.0 1988 444.6 391.6 259.3 146.4 91.4 21.5 56.0 67.4 1. Difference between total and nonsterling assets does not equal sterling n.a. Not available. assets because of a small amount of unallocated items. SOURCE. Bank of England Quarterly and special tabulations provided by the 2. CDs are often negotiable instruments and the issuing bank does not have Bank of England, information on the ultimate holder. banks, and certificates of deposit (CDs). Liabili- 1988 (table 5). Loans, including customers' liaties to related offices abroad constitute only bilities for acceptances, are by far the largest about one-third of total liabilities to all overseas component of assets, accounting for about oneresidents. In recent years, the volume of CDs half of the total. Cash and due from banks, issued (mainly dollar denominated) by the Lon- largely reflecting clearing and interbank transacdon branches of Japanese banks has virtually tions, accounts for about one-third of total asexploded. At year-end 1988, these branches had sets, while holdings of securities increased from issued more than $65 billion in Euro-CDs, about a negligible amount to more than $20 billion by one and one-half times the value of Euro-CDs year-end 1988. issued by branches of U.S. banks in London. In particular, commercial and industrial loans Branches of Japanese banks currently account to borrowers with an identified U.S. residence for about two-fifths of the total issuance of Euro- constitute the largest and most rapidly growing CDs in London.4 component of the loan portfolios of Japanese In summary, U.K. branches of Japanese banks banks in the United States (table 6). By year-end deal mainly in foreign currencies with non-U.K. 1988, commercial and industrial loans to these residents. These branches are large net borrow- U.S. borrowers amounted to about $60 billion. ers in the interbank Eurocurrency market and are By comparison, similar loans to domestic cusby far the largest issuers of Euro-CDs. A com- tomers by large domestically chartered U.S. parison of the data in tables 3 and 4 shows the banks amounted to about $300 billion. Loans by significant role the London branches play in Japanese agencies and branches to foreign comfunding their related offices in other countries, 5. Assets of U. S. branches and agencies including their head offices in Japan. As of Deof Japanese banks cember 1988, these offices in London held more Billions of dollars than $50 billion net in claims on related offices. Customers' Cash Year liabilities and due Activities in the United States ending Total Securities Loans for from December acceptances banks The activities of agencies and branches of Japa- 1980 60.8 1.4 36.5 5.4 5.1 1981 73.7 1.6 44.2 7.2 5.9 nese banks in the United States grew by a factor 1982 96.9 2.6 53.4 8.2 19.4 1983 108.2 3.7 54.7 10.2 26.2 of five over the eight-year period from 1980 to 1984 130.8 6.4 57.8 15.3 41.2 1985 151.2 13.1 65.1 16.6 46.3 1986 208.3 19.3 83.0 19.1 70.2 1987 252.3 23.4 103.8 24.1 83.1 1988 306.7 23.2 131.6 24.5 95.8 4. Some of these Euro-CDs are purchased by U.S. investors, including money market mutual funds. SOURCE. Call Report. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The U.K. and U.S. Activities of Japanese Banks, 1980-88 43 6. Loan portfolios of U. S. agencies and branches of Japanese banks Billions of dollars YYeeaarr Commercial and industrial TToo TToo FFoorr ppuurrcchhaassiinngg RReeaall eennddiinngg TToottaall ffoorreeiiggnn ffiinnaanncciiaall aanndd ccaarrrryyiinngg eessttaattee DDeecceemmbbeerr Total U.S. Foreign ggoovveerrnnmmeennttss iinnssttiittuuttiioonnss sseeccuurriittiieess • 1980 . 36.5 18.8 9.3 9.5 4.8 11.5 .2 1981 . 44.2 21.8 10.0 11.8 4.9 15.9 .3 .2 1982 . 53.4 24.1 11.5 12.7 7.0 21.4 .2 * 1983 . 54.7 25.0 12.2 12.8 8.3 20.0 .5 * 1984 . 57.8 28.2 16.3 12.0 8.1 20.6 .7 * 1985 . 65.1 32.5 20.1 12.4 7.7 22.3 2.0 .2 1986 . 83.0 43.0 30.2 12.8 7.8 26.5 3.2 1.6 1987 . 103.8 59.0 45.9 13.0 10.1 26.5 1.3 6.3 1988 131.6 74.8 61.4 13.4 10.8 28.5 2.5 13.8 •Less than $50 million. SOURCE. Call Report. 7. Major sources of funding to U.S. agencies and mercial borrowers and to foreign governments branches of Japanese banks were relatively stagnant over this period. Since Billions of dollars December 1985, loans secured by real estate Net liabilities to banks Deposits have grown rapidly at Japanese agencies and YYeeaarr branches and exceed their loans to either foreign ending In the In Related From From December United foreign institutions U.S. foreign commercial borrowers or foreign governments.5 States1 countries1 abroad residents residents Japanese banks have also been heavily involved 1980 .... 11.1 -3.0 3.6 10.0 .1 in financing large corporate restructurings in the 1981 .... 15.8 -1.9 2.7 10.5 .1 1982 .... 20.3 .5 -1.6 10.6 .8 United States. 1983 .... 19.7 5.7 -.8 8.2 1.2 An analysis of the major sources of funding 1984 .... 18.0 5.8 6.9 7.2 1.8 1985 .... 23.9 9.3 7.9 8.3 1.6 for U.S. offices of Japanese banks reveals that, 1986 .... 23.7 15.3 12.5 15.2 3.6 1987 .... 39.3 22.3 9.1 17.4 3.9 similar to the pattern in the United Kingdom, 1988 .... 45.9 21.1 18.4 22.8 4.8 U.S. offices of Japanese banks are extremely 1. Include sum of net federal funds transactions, net interbank deposits, and large net borrowers in domestic interbank mar- gross borrowings from unrelated banks minus gross loans to unrelated banks. kets and in recent years have been smaller (but SOURCE. Call Report. still significant) net borrowers from banks out- of a total of $307 billion. On a risk-adjusted basis, side the United States (table 7). Deposits from however, when claims are reallocated to the nonbank U.S. residents and nonbank foreign country of the ultimate parent obligor, the total residents constitute a relatively small propor- Japanese risk of the U.S. agencies and branches tion of their total funding. Unlike the offices of amounted to $208 billion—a clear indication that Japanese banks in London, which were net U.S. offices of Japanese banks are closely assoproviders of funds to their related offices in ciated with Japan-based customers.6 other countries, U.S. offices of Japanese banks In summary, when compared with their U.K. (at least since 1984) have relied heavily on net counterparts, the U.S. offices of Japanese banks advances from related institutions abroad. show some similarities and as well as certain A large proportion of activity by Japanese important differences. The main similarity is that banks is with customers identified as U.S. resi- both are large net borrowers in local banking dents. This geographic identification, however, markets. The main difference is that offices of does not properly account for the fact that many Japanese banks in London serve as an important of these customers are affiliates of Japanese net funding source for their related offices in entities. As of December 1988, direct claims on other countries, while offices in the United States Japanese residents by U.S. agencies and tend to be net takers of funds from related offices branches of Japanese banks were $106 billion out in other countries. In the United States, Japanese 5. It is not possible to determine the extent to which these 6. Figures are derived from aggregate data on the Country real estate loans are related to the boom in property lending Exposure Report for U.S. Agencies and Branches of Foreign in Japan or to Japanese investment in U.S. real estate. Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

44 Federal Reserve Bulletin • February 1990 banks are heavily concentrated in lending to activities of Japanese banks through the midlocally based companies, including U.S. affiliates 1980s. While considerable progress on interest of Japanese companies, while in the United rate liberalization has been undertaken in Japan Kingdom, Japanese banks lend largely to nonlo- in recent years, including liberalization of the call cal borrowers in nonlocal currencies.7 money market in late 1988, currently about 40 percent of bank liabilities in Japan are subject to regulated rates. THE BANKING AND EXTERNAL ECONOMIC Data describing the development of the bal- ENVIRONMENT IN JAPAN ance sheets of Japanese city banks' offices in Japan over a period of slow interest rate dereg- The Banking Environment ulation are shown in table 8.9 On the asset side, loans and discounts constitute the largest com- Large multinational banks are managed and op- ponent and accounted for the largest absolute erated on a worldwide consolidated basis. There- growth of the domestic office assets of Japanese fore, branches of nonlocal banks will be influ- banks. Loans and discounts actually increased enced by factors specific to their home country slightly as a percentage of total assets, while as well as to the local environment in which these acceptance financing—largely trade related and branches are operating. In some cases, a foreign perhaps more easily transferred abroad— branch operating in a less regulated environment decreased as a fraction of total assets. might engage in activities that otherwise would The liability structure of Japanese city banks have been undertaken by the bank's home coun- operating in a gradually deregulated environment try office had it been less regulated, particularly changed moderately over the 1980-88 period in cases of limitations on interest rates or quan- (table 9). Over the entire period, total deposits titative restraints on particular activities. In fact, actually grew less rapidly than total liabilities Eurocurrency banking largely owes its existence did, and the share of deposits in total funding to banks' seeking to avoid regulatory restraints in declined nearly 10 percentage points, despite the their domestic banking markets. rapid increase since 1986 in deposits with unreg- Describing the complexity of the de jure and de ulated interest rates. In fact, all deposit growth facto regulatory environment for banking in Ja- since year-end 1986 at domestic offices of Japapan over these eight years is beyond the scope of nese city banks has come from time deposits with this article, but the general situation was summa- liberalized interest rates. Negotiable CDs, with rized in 1986 by Yoshio Suzuki, formerly an market-determined interest rates, remain a rela- Executive Director of the Bank of Japan: tively small percentage of domestic office funding because of limits on size, maturity, and until Financial innovation and deregulation of interest rates recently, total CD issuance relative to net worth. has proceeded only gradually in Japan, so that interest One source of funding that has been extremely rates on deposits, which make up the bulk of liabilities elastic for Japanese city banks over the whole of financial institutions, remain largely regulated; the period has been net interoffice liabilities, which exceptions are interest rates on foreign currency dein a closed system represent borrowings from posits and CDs, the latter of which are subject to quantity regulations.8 Japanese branches in overseas markets that can be used in part to finance loans to local Japanese Therefore, according to Suzuki, both price and companies. quantity limitations tended to constrain domestic The basic picture that emerges is that Japanese city banks, for at least much of the 1980s, were operating in an environment with low and regu- 7. In addition, in London, Japanese banks tend to be large net recipients of deposits from foreign official institutions, while their offices in the United States are large net lenders to foreign official institutions. 9. City banks are the thirteen large Japanese banks that 8. See Yoshio Suzuki, ed., Money, Finance, and Macro- operate on a nationwide basis. Data for city banks are economic Performance in Japan (Yale University Press, reported separately in the Economic Statistics Monthly pub- 1986), p. 55. lished by the Bank of Japan. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The U.K. and U.S. Activities of Japanese Banks, 1980-88 45 8. Assets of Japanese city banks, total and selected categories Cash and Customers' Year ending Call Loans and Total, December deposits loans Securities discounts liabilities for all assets1 with others acceptances Amount (100 billion yen) 1980 109 21 167 713 115 1,228 1981 107 36 174 788 109 1,312 1982 113 49 177 871 114 1,419 1983 132 62 192 964 112 1,557 1984 148 50 201 1,081 114 1,702 1985 155 73 221 1,235 132 1,940 1986 172 94 262 1,412 139 2,205 1987 214 87 310 1,606 158 2,510 1988 261 88 371 1,771 166 2,818 Percent of total 1980 8.9 1.7 13.6 58.1 9.4 100.0 1981 8.2 2.7 13.3 60.1 8.3 100.0 1982 8.0 3.5 12.5 61.4 8.0 100.0 1983 8.5 4.0 12.3 61.9 7.2 100.0 1984 8.7 2.9 11.8 63.5 6.7 100.0 1985 8.0 3.8 11.4 63.7 6.8 100.0 1986 7.8 4.3 11.9 64.0 6.3 100.0 1987 8.5 3.5 12.4 64.0 6.3 100.0 1988 9.3 3.1 13.2 62.8 5.9 100.0 1. The amounts of yen and percentages do not sum to totals because some SOURCE. Economic Statistics Monthly, Bank of Japan, smaller categories were omitted. 9. Liabilities of Japanese city banks, total and selected categories Deposits Y D e e a c r e e m n b di e n r g Time w d it e h p osits C o e f r d ti e f p ic o a s t i e t s m C o a n l e l y B B o a r n r k ow o e f d J a f p r a o n m Interoffice all l T ia o b t i a l l i , t ies1 Total liberalized rates Amount (100 billion yen) 1980 854 11 45 18 16 1,228 1981 940 19 59 11 12 1,312 1982 990 21 68 17 15 1,419 1983 1,079 28 71 32 25 1,557 1984 1,148 46 80 24 47 1,702 1985 1,256 49 68 31 91 1,940 1986 1,375 110 61 110 51 142 2,205 1987 1,587 289 64 124 52 182 2,510 1988 1,728 485 95 124 55 237 2,818 Percent of total 1980 69.5 .9 3.7 1.5 1.3 100.0 1981 71.6 1.4 4.5 .8 .9 100.0 1982 69.8 1.5 4.8 1.2 1.1 100.0 1983 69.3 1.8 4.6 2.1 1.6 100.0 1984 67.5 2.7 4.7 1.4 2.8 100.0 1985 64.7 2.5 3.5 1.6 4.7 100.0 1986 62.4 5.0 2.8 5.0 2.3 6.4 100.0 1987 63.2 11.5 2.5 4.9 2.1 7.3 100.0 1988 61.3 17.2 3.4 4.4 2.0 8.4 100.0 1. The amounts of yen and percentages do not sum to totals because some SOURCE. Economic Statistics Monthly, Bank of Japan. smaller categories were omitted. lated domestic interest rates, on both deposits that level through year-end 1988. Limits on the and interbank borrowings, and therefore were call money rate in the domestic loan market, as faced with a demand for funds above what they measured by the difference between that rate and could raise through deposits. That excess de- either the Euro-yen rate or the market-determand has grown over time: For example, at mined domestic rate on CDs, constrained the year-end 1980 the loan-deposit ratio at Japanese Japanese city banks' ability to acquire funds in city banks was 0.83; by year-end 1986 that ratio the domestic interbank market for call money had increased to 1.03 and remained at essentially (see chart 1). To meet the excess demand for Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

46 Federal Reserve Bulletin • February 1990 1. Differential between the call money rate and the International Monetary Fund interprets these market-determined rates data by noting the following: In Japan, the shift of asset composition toward nonbank institutional investors is also related to the relatively high interest rates they offer to savers under the current regulated interest rate structure. With interest rate deregulation proceeding rapidly, however, that factor will be less important in the future.10 Banks in Japan, therefore, because of their regulated status, have been losing ground to other financial institutions as well as facing an excess demand for loans. loans above their ability to acquire domestic The Japanese External Economic funding, Japanese city banks used net borrow- Environment ings from branches in offshore markets—an unconstrained source of funds in terms of both Since the beginning of the 1980s, Japan has run a price and quantity. current account surplus (table 10). From 1983 The regulation of interest rates in Japan also through 1987, the current account surplus rose impeded the growth of domestic offices of Japa- steadily, and between 1986 and 1988 averaged nese banks relative to other financial intermedi- about $85 billion a year. During this period, net aries whose liabilities and assets have been less long-term capital outflows exceeded the current constrained. While other factors, such as rising account surplus in every year from 1981 through income and an aging population mix, have af- 1988 (except for 1983); from 1986 through 1988, fected the choice of financial instruments in the cumulative long-term capital outflow was Japan, as well as in other industrial countries, the approximately $150 billion greater than the cudecline in Japanese banks' share in total financial mulative current account surplus. A large proassets in Japan since 1981 has been much more portion of the Japanese demand for long-term rapid than could be reasonably explained by assets has reflected the acquisition of foreign growing wealth or demographic changes (chart securities by nonbank investors such as insur- 2). The World Economic Outlook published by ance companies and pension funds. The large portfolio investments by Japanese nonbank financial firms in foreign securities re- 2. Shares of private Japanese financial institutions sults in part from regulatory changes in Japan, in total assets beginning in the late 1970s, that allowed nonbank institutions to diversify and to seek higher rates r-Trust banks of return abroad as restrictions on holding assets Insurance companies r- Depository institutions denominated in foreign currencies were gradually lifted. In 1979, pension trusts were permitted to hold foreign-currency assets of up to 10 percent of their total assets in accounts at trust banks. In 1986, this proportion was raised to 25 percent and then to 30 percent. This liberalization permitted a substantial increase in holdings of foreign securities in pension trusts in 1986 and 1987. The proportion of assets denominated in 10. See International Monetary Fund, World Economic 1981 1982 1983 1984 1985 1986 1987 1988 Outlook (IMF, 1989), p. 89. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The U.K. and U.S. Activities of Japanese Banks, 1980-88 47 10. Japanese external accounts Billions of dollars Net change YYYeeeaaarrr eeennndddiiinnnggg CCCuuurrrrrreeennnttt Long-term assets Short-term assets DDDeeeccceeemmmbbbeeerrr aaaccccccooouuunnnttt Total Portfolio Lending Nonbanks Banks 1980 .. 10.7 2.3 9.4 -2.8 .0 13.1 1981 .. 4.8 -9.7 4.4 -5.3 2.8 6.4 1982 .. 6.9 -15.0 2.1 -7.3 3.1 .0 1983 .. 20.8 -17.7 -1.9 -8.5 2.1 -3.6 1984 .. 35.0 -49.7 -23.6 -12.0 -.6 17.6 1985 .. 49.2 -64.5 -43.0 -10.5 3.1 10.8 1986 .. 85.8 -131.5 -101.4 -9.3 .8 58.8 1987 .. 87.0 -136.5 -93.8 -16.3 20.0 71.8 1988 79.5 -130.3 -66.8 -15.0 21.9 44.5 SOURCE. International Monetary Fund, World Economic Outlook (April 1989), p. 85. foreign currencies that was permitted for many mestic sources of funds and relatively more types of insurance companies was also raised in dependent on their overseas branches to fund 1986, from 10 percent of total assets to 25 percent their domestic lending. and then to 30 percent. Finally, in 1987, a similar limit on assets denominated in foreign currencies held by the Postal Life Insurance Fund was THE EMPIRICAL MODEL raised from 10 percent to 20 percent. The net effect of these and other liberalizing measures The previous sections have described the U.K. was a substantial increase in the holdings of and U.S. activities of Japanese banks and the assets denominated in foreign currencies by Jap- financial and regulatory environment in which anese institutional investors. they operate in Japan. The authors have esti- While net long-term capital outflows have been mated some preliminary statistical relationships very large, net short-term capital inflows have to see which factors appear related to growth of been positive during this period. Short-term in- assets of the branches of Japanese banks in flows through the banking system became notice- these two overseas markets.11 able in 1984 and 1985 and grew to a substantial The explanatory variables included factors in amount in 1986 and 1987 when other financial the overseas markets that may be influencing the intermediaries were actively investing abroad growth of assets of these branches as well as (table 10). As noted earlier, these short-term factors specific to the Japanese domestic econinflows were largely net borrowings by Japanese omy. The variables included cyclical factors, in banks from their overseas branches, particularly both home and foreign markets, as measured by their branches in London. Because of its position capacity utilization, the value of Japanese meras a short-term borrower and long-term net chandise exports plus imports because of the lender, Japan is playing a role of international importance of foreign branches in financing financial intermediary as well as serving as a net trade, and seasonal dummies to capture possible source of world savings. seasonal "window dressing." Also, two mea- In summary, it appears that the activities of sures of the degree of financial restraint in Japan Japanese banks abroad from 1980 to 1988 were were used: (1) the difference between the unreglinked to the financial regulatory climate in Ja- ulated domestic rate on CDs and the rate on call pan. The deregulation of nonbank intermediaries money in the interbank market, and (2) the and of foreign activities of Japanese banks, com- difference between loans and deposits at city pared with the slower de facto deregulation of deposits at banks in Japan, rendered Japanese 11. See Terrell, Dohner, and Lowrey, "The U.S. and U.K. banks relatively less competitive in seeking do- Activities of Japanese Banks." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

48 Federal Reserve Bulletin • February 1990 banks in Japan.12 These two variables attempted United States, similar equations were estimated. to capture the effect of both price and quantity Besides considering the determinants of total restraints on the ability of Japanese banks in assets, the determinants of commercial and in- Japan to fund their loan demand directly from dustrial (C & I) loans and interbank claims were local sources or to trade in interbank markets at analyzed to see if they differed. For these three market-clearing prices. The empirical model did separate measures, the activities of Japanese not include specific variables for the cost of banks in the United States were assumed to be funding or capital for Japanese banks relative to influenced by U.S. GNP and by the total amount the costs for banks headquartered in other coun- of Japanese trade, which is largely financed by tries. While these factors may be important over Japanese banking offices in the United States. time, they were not included for two reasons. Besides the cyclical variable for capacity utiliza- First, deriving satisfactory measures of the cost tion in Japan, a cyclical variable for the United of funds for different national banking groups States was also used because a large proportion operating in worldwide markets is notoriously of Japanese lending in the United States appears difficult and beyond the scope of this article. related to the U.S. economy. Seasonal dummies Second, factors affecting global funding costs were included, as were the two different meaare unlikely to explain growth in the U.K. and sures of financial restraint in Japan. U.S. markets as satisfactorily as local market For total assets of Japanese banks in the factors. United States, all of the explanatory variables, In examining the determinants of the activi- except for Japanese capacity utilization, were ties of Japanese banks in the United Kingdom, estimated to be statistically important determithe focus was on the value of total nonsterling nants. The equations for C & I loans and for assets of Japanese branches because these as- interbank claims showed similar results for seasets are the primary component of total assets. sonal influences and for the effect of capacity This focus on nonsterling assets suggested that utilization in both the United States and Japan, cyclical effects from the U.K. economy would as well as the effect of financial restraint in Japan. be largely irrelevant and that the size of the However, significant differences were apparent local market could best be measured by the in terms of the effect of U.S. GNP and Japanese Eurocurrency lending of all banks in London trade on these two categories of banking activity. rather than by GNP or some other demand Japanese trade was a significant determinant for variable in the United Kingdom. The results of C & I loans, which underscores the importance the model indicated that important determi- of U.S. offices in financing Japanese trade, while nants of nonsterling assets of Japanese this variable was not statistically significant for branches are (1) the size of the total Eurocur- claims on banks. On the other hand, U.S. GNP rency banking market in London, excluding was found to be a significant determinant of assets of Japanese banks, (2) the value of Jap- interbank claims but not of C & I loans. This lack anese total trade, (3) the level of capacity of a statistical relationship was somewhat surutilization in Japan (where higher degrees of prising given how actively Japanese banks comcapacity utilization cause Japanese banks to pete for domestic business lending opportunities focus on lending in Japan rather than abroad), in the United States, including purchasing loans (4) seasonal window dressing, and (5) the effect from U.S. banks. The lack of a relationship may of financial restraint in Japan as measured by result from a strong correlation between U.S. the difference between loans and deposits. GNP and other variables in the model. For the activities of Japanese banks in the In summary, U.S. activities of Japanese banks during this period appeared strongly related to Japanese domestic financial variables as well as 12. As shown in chart 1, this differential between the unregulated rate on domestic CDs and the rate on call money to conditions in the U.S. market. Commercial in the interbank market showed a pattern similar to that of the and industrial loans at these offices responded difference between the Euroyen rate and the call rate. The both to expansions in Japanese trade and to difference between loans and deposits was calculated from data shown in tables 8 and 9. restraints on domestic Japanese interest rates, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The U.K. and U.S. Activities of Japanese Banks, 1980-88 49 while interbank trading at U.S. offices of have shifted some of their commercial lending, as Japanese banks responded to both price and well as some of their interbank trading, to the quantity restraints on domestic Japanese banking United States. The U.K. branches appear to activity. have been used as a flexible net source of funding for loans by the home offices. The implications of these findings are twofold. SUMMARY AND CONCLUSIONS First, to the extent that Japanese bank activities in these two centers have represented a response Japanese banks have become active competitors to domestic Japanese restraints, the concern in in major international markets. Their competitive other countries about local market penetration success appears to result from a variety of fac- based on percentages of loans or assets in these tors, including the expansion of Japan as a trad- two markets may have been overstated. Second, ing nation and the ability of Japanese banks to the continued deregulation of banking in Japan, fund their activities at very attractive rates in such as the removal of the restraints on interest some markets. Japanese bank expansion in the rates in the interbank market for call money in U.K. and U.S. markets is also influenced by late 1988, should lead to some repatriation of local market opportunities. Besides these fac- what is currently counted as international banktors, activities in both markets appear in part ing business back to the domestic banking mardirected toward operating in less regulated envi- ket in Japan. If such a repatriation occurs, it ronments, particularly with respect to funding. In could lead to a slowing or possible reversal of the response to domestic restrictions on prices and trend toward an increase in the share of Japanese on the volume of certain activities during most of banks in measured international banking aggrethe 1980-88 period, Japanese banks appear to gates. The bibliography appears on the following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

50 Federal Reserve Bulletin • February 1990 SELECTED BIBLIOGRAPHY Poulsen, Annette B. "Japanese Bank Regulation and the Activities of U.S. Offices of Japanese Cargill, Thomas F., and Shoichi Royama. The Banks," Journal of Money, Credit, and Bank- Transition of Finance in Japan and the United ing, vol. 18 (August 1986), pp. 366-73. States: A Comparative Perspective. Hoover Salomon Brothers. Japanese Banks—At a Institution Press, 1988. Crossroads? New York: Salomon Brothers, Dohner, Robert S., and Henry S. Terrell. "The 1988. Determinants of the Growth of Multinational Suzuki, Yoshio, ed. The Japanese Financial Banking Organizations: 1972-86," Interna- System. New York: Oxford University Press, tional Finance Discussion Papers 326. Wash- 1987. ington: Board of Governors of the Federal Money, Finance, and Macroeconomic Reserve System, June 1988. Performance in Japan. New Haven: Yale Uni- Euromoney. "Japanese Banks in the U.S.: On versity Press, 1986. the Same Team," Special Supplement to Eu- Terrell, Henry S. "U.S. Banks in Japan and romoney, July 1988, pp. 1-48. Japanese Banks in the United States: An Em- Hanley, Thomas H. The Japanese Banks: Posi- pirical Comparison," Federal Reserve Bank of tioning For Competitive Advantage. New San Francisco, Economic Review (Summer York: Salomon Brothers, 1986. 1979), pp. 18-30. International Monetary Fund. World Economic Walton, R.J., and Dermot Trimble. "Japanese Outlook. Washington: IMF, 1989. Banks in London," Bank of England Quar- Japan Economic Institute. Japanese Banks in the terly Bulletin, vol. 27 (November 1987), pp. United States. Washington: JEJ, 1988. 518-24. Nakao, Shigeo. "Euro-Dollar Borrowing of Ja- Zimmerman, Gary C. "The Growing Presence of pan through London Financial Market," Japanese Banks in California," Federal Re- Osaka City University Economic Review, vol. serve Bank of San Francisco, Economic Re- 24 (January 1989), pp. 25-46. view (Summer 1989), pp. 3-17. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

51 Industrial Production Released for publication December 15 the settlement in late November of the strike at a major aircraft producer also contributed to higher Industrial production edged up in November fol- production last month. Excluding the impact of lowing revised declines of 0.6 percent in October these events, the total index would have been and 0.3 percent in September. The estimate for little changed in both October and November. At November includes a rebound in the output of 141.5 percent of the 1977 annual average, induscomputers and related parts, industries in which trial production in November was 1.2 percent production apparently had been disrupted in Oc- higher than it was a year earlier. Manufacturing tober by the California earthquake. Additionally, output also posted a small rise in November, and Ratio scale, 1977=100 160 140 160 Manufacturing Nondurable ^^ * z 140 Durable — 120 ** 100 i i 1 1 1 80 Consumer Goods 180 _ Intermediate Business - — 160 Products supplies Nondurable - 140 _ ,— _ ^ V^ - — _ 120 Construction S Durable supplies / 100 ' , i , 1 1 1 11 11 1 1 1 1 80 Motor Vehicles and Parts 150 135 120 90 75 60 1983 1985 1987 1989 1983 1985 1987 1989 All series are seasonally adjusted. Latest series: November. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

52 Federal Reserve Bulletin • February 1990 1977 = 100 Percentage change from preceding month Percentage cchhaannggee,, Group 1989 1989 NNoovv.. 11998888 ttoo NNoovv.. 11998899 Oct. Nov. July Aug. Sept. Oct. Nov. Major market groups Total industrial production 141.3 141.5 -.1 .4 -.3 -.6 .1 1.2 Products, total 150.9 151.5 -.4 .5 -.3 -.8 .4 2.1 Final products 148.8 149.4 -.7 .6 -.4 -1.2 .4 1.8 Consumer goods 139.5 139.2 -.9 .4 -.2 .4 -.2 1.7 Durable 126.4 125.7 -2.7 1.1 -.8 -1.0 -.5 -2.7 Nondurable 144.3 144.2 -.3 .2 -.1 .9 -.1 3.2 Business equipment.., 164.1 166.2 -.6 .8 -.7 -2.7 1.3 3.1 Defense and space 175.7 177.1 .5 .4 -.3 -3.5 .8 -2.8 Intermediate products.. 158.4 158.5 .4 .0 .1 .4 .1 2.8 Construction supplies. 141.4 142.0 .7 -.5 -.6 .5 .4 .9 Materials 128.2 128.0 .4 .4 -.3 -.2 -.2 -.3 Major industry groups Manufacturing 147.5 147.8 -.1 .5 -.4 -.8 .2 1.4 Durable 144.3 145.1 -.4 .7 -.7 -1.8 .5 -.1 Nondurable 152.0 151.7 .2 .2 .1 .5 -.2 3.4 Mining 103.6 103.7 .6 .3 .7 .4 .1 -.9 Utilities 115.1 114.8 -.3 -.5 .9 .7 -.2 1.0 NOTE. Indexes are seasonally adjusted. factory capacity utilization slipped further to 82.7 in October, reflecting the rebounds in computers percent. Detailed data for capacity utilization are and aircraft. Output of most major components shown separately in "Capacity Utilization," Fed- of business equipment has changed little, on eral Reserve monthly statistical release G.3. balance, since June. In market groups, production of consumer Output of construction supplies is estimated to goods remained sluggish in November, owing have increased moderately in both October and mainly to continued weakness in durables. Auto November, continuing the upward trend that assemblies dropped to an annual rate of 6.2 began last summer. Production of materials demillion units from the rate of 6.7 million units in clined again in November, mainly because of October; however, output of light trucks rose further cutbacks in parts for consumer durables, sharply, offsetting the decline in autos. Produc- basic metals, and textiles. tion of home goods declined further as the output In industry groups, the small gain in manufacof appliances was curtailed again. Output of turing production in November resulted from the nondurable consumer goods was about un- rebound in computing equipment and aircraft, changed after having posted a large rise in Octo- which more than offset sharp declines in primary ber. Production of business equipment in No- metals, textiles, and apparel; output of motor vember regained about one-half of the sharp drop vehicles and parts decreased slightly. Since midyear, most durable industries have weakened, Total industrial production—Revisions with particularly large cutbacks in motor vehicles Estimates as shown last month and current estimates and related industries. Among nondurables, output in most industries, especially paper and print- Percentage change Index (1977=100) from previous ing, has continued to increase, on balance, since MMoonntthh months June. However, production of apparel and textiles has weakened significantly. Outside of man- Previous Current Previous Current ufacturing, output of mining edged up in Novem- Aug 142.4 142.5 .4 .4 ber as oil and gas extraction rose, but coal mining Sept 142.4 142.1 .0 -.3 Oct 141.4 141.3 -.7 -.6 was about unchanged; production at utilities was Nov 141.5 .1 down slightly. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

53 Announcements STATEMENT BY CHAIRMAN GREENSPAN REGULATION C: AMENDMENTS ON NOMINATION OF DAVID MULLINS The Federal Reserve Board revised on Decem- Chairman Alan Greenspan of the Federal Re- ber 12, 1989, its Regulation C (Home Mortgage serve Board issued the following statement on Disclosure) to implement amendments that were December 8, 1989: contained in the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA). The "I have had the pleasure of working closely amendments are effective January 1, 1990. with David Mullins over the past year. He is The amendments to the regulation accomplish extraordinarily capable and will make a superb the following: governor. I trust the Senate will move expedi- • Expand the coverage to include mortgage tiously on his nomination." lenders that are not affiliated with depository institutions or holding companies. • Require institutions to report data regarding applications for mortgage and home improve- REGULATION B: AMENDMENTS ment loans in addition to data about loan originations and purchases. The Federal Reserve Board issued on December • Require most institutions to report the race, 4, 1989, amendments to its Regulation B (Equal sex, and income of loan applicants. Credit Opportunity). The amendments imple- The Board has also adopted a new register ment requirements established by the Women's format for Home Mortgage Disclosure Act re- Business Ownership Act of 1988 that creditors porting. The new loan-application register form provide written notices about credit denials and that institutions are required to fill out will log keep records of loan applications from busi- loan applications, loans actually made, and loans nesses. These rules become effective April 1, purchased. The first set of reports in this new 1990. format will be due March 1, 1991. The revisions to the regulation will require creditors to give written notice of the right to obtain reasons for a credit denial when the business applicant has gross revenues of $1 million DECREASE IN RESERVABLE or less. The changes will also require the reten- TRANSACTION ACCOUNTS tion of records on business credit applications for twelve months. The Federal Reserve Board announced on De- The rules correspond closely to the rules that cember 7, 1989, a decrease from $41.5 million to govern consumer credit applications. A creditor $40.4 million in the net transaction accounts to that follows the provisions for consumer credit which a 3 percent reserve requirement will apply would be in full compliance with the act and with in 1990. the regulation. The Board also left the amount of reservable For business applicants with revenues of more liabilities that are exempt from reserves at $3.4 than $1 million, the modified rules still apply. million of total reservable liabilities. Lenders also have the option of following the Additionally, the Board increased the deposit rules applicable to businesses with revenues of cutoff level, which separates weekly reporting $1 million or less in all cases. institutions from quarterly reporters, from $42.1 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

54 Federal Reserve Bulletin • February 1990 million to $43.4 million. Institutions with total Comment on the amendments to Regulation reservable liabilities below the exemption level CC and modifications to the notice of nonpayof $3.4 million are excused from reporting, even ment service is requested by February 16, 1990. on a quarterly basis, if their deposits can be Additionally, the Board has issued for public estimated from other sources. comment a proposed preemption determination These adjustments took effect beginning De- regarding California's funds availability law. cember 19, 1989. Comment on the preemption determination is requested by January 16, 1990. The Federal Reserve Board issued for public PROPOSED ACTIONS comment on December 12, 1989, a proposal to revoke current exemptions from compliance with The Federal Reserve Board issued for public Regulation C (Home Mortgage Disclosure) for comment on December 4, 1989, proposed revi- state-chartered institutions in Massachusetts, sions to its staff commentary to Regulation B Connecticut, and New Jersey. The Board had (Equal Credit Opportunity). Comment is re- issued exemptions for institutions in these states quested by February 7, 1990. because they were subject to state laws that were The Federal Reserve Board issued for public substantially similar to the old requirements. comment on December 8, 1989, proposed Comment is requested by January 15, 1990. amendments to Regulation CC (Availability of The Federal Reserve Board requested on De- Funds and Collection of Checks), which imple- cember 29, 1989, public comment on proposed ments the Expedited Funds Availability Act. The transition capital standards for state member proposed amendments would shorten the time banks and bank holding companies through the requirement for sending a notice of nonpayment end of 1990. The proposed guidelines also set to a depository bank and would make other forth the Board's preliminary views on the aptechnical and clarifying amendments to Regula- propriate leverage standard to be applied to tion CC. banking organizations in conjunction with the The Board also issued for public comment risk-based capital framework after year-end proposed modifications to the Federal Reserve's 1990. Comments should be received by the notice of nonpayment service, which would take Board on this matter no later than March 9, 1990. effect only if the Board ultimately adopts an The Board had announced its proposed transiamendment to Regulation CC that shortens the tion capital standards, on November 22, 1989, time requirement for providing notice of nonpay- and had indicated that it would seek public ment. comment on the standards by year-end. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

55 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON NOVEMBER 14, 1989 mostly because of the effects of temporary disruptions to production. Domestic Policy Directive Retail sales fell appreciably in October from upward revised levels for August and September, The information reviewed at this meeting sug- as purchases of motor vehicles dropped sharply. gested that the economy had continued to ex- Housing starts fell further in September, and the pand, though unevenly and at a somewhat slower multifamily component registered its lowest level pace than earlier in the year. While the service- since mid-1982. For the third quarter as a whole, producing sector appeared to be growing moder- starts were about unchanged from their reduced ately, manufacturing had been weak, owing to second-quarter average. sluggish demand and to strikes and other disrup- Indicators of business capital spending contintions to production. Price increases had been ued to suggest that growth had moderated from smaller since midyear, but there had been no its rapid pace in the first half of the year, primarabatement of wage inflation. ily as a result of slower growth in outlays for Total nonfarm payroll employment increased information-processing equipment. Shipments of appreciably in October, but its growth had been nondefense capital goods edged lower in Septemmore moderate on balance over the past several ber, and orders data suggested that equipment months, especially in the private sector. Wide- outlays would remain sluggish in coming months. spread job gains were apparent in the service- Nonresidential construction activity also fell, producing sector, but manufacturing payrolls de- largely owing to a decline in commercial strucclined further as a result of continued weakness tures other than office buildings, and construcin motor vehicles and other durable goods indus- tion permits continued the downtrend evident tries. In the public sector, hiring by state and over the past few months. The sparse data availlocal governments was robust in October and had able on business inventories for September indicontributed substantially to total employment cated that manufacturers' stocks had declined growth over the past three months. The civilian somewhat in that month after a sizable gain on unemployment rate remained within the narrow balance over the previous two months. At the range around 5VA percent that had prevailed since wholesale level, inventories fell for a second early 1989. straight month. After three months of modest increases on The nominal U.S. merchandise trade deficit balance, industrial production was depressed no- increased in August to its highest level thus far ticeably in October by strike activity and other this year, as the value of non-oil imports surged. disruptions; adjusted for these temporary influ- For July and August combined, the value of ences, production was about unchanged. Output imports—especially of consumer goods and maof consumer goods declined as the production of chinery—was somewhat above the secondappliances and motor vehicles, particularly light quarter level. The quantity of imports rose even trucks, fell sharply. Production of business more strongly over that two-month period as equipment dropped substantially, reflecting the import prices declined on average. The value of strike at a major aircraft manufacturer and the exports in the July-August period was somewhat earthquake in northern California. Total indus- below the level in the second quarter; the quantrial capacity utilization dropped in October, tity of exports rose appreciably, but the prices Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

56 Federal Reserve Bulletin • February 1990 received fell. In most foreign industrial coun- stock prices on October 13, while financial martries, indicators of economic activity suggested kets remained highly sensitive and volatile, the that the slower pace of the second quarter had Manager for Domestic Operations followed an continued in the third quarter. In Germany, accommodative approach in supplying reserves. however, industrial production had rebounded Around the same time, a decision was made strongly from its second-quarter decline. under the provisions of the October 3 directive to Producer prices for finished goods rose further implement a slight easing of reserve conditions in October, boosted by sizable jumps in the on a more permanent basis; a further slight prices of a variety of food products. Excluding easing was effectuated during the first part of food and energy items, prices for finished goods November. These decisions were made in light of were little changed. Consumer prices rose information that suggested some increase in the slightly in September after registering little risk of a pronounced weakening in the growth of change over the previous two months. Energy business activity. To reflect a decline in seasonal prices fell further, while a sharp increase in borrowing, several technical reductions also apparel prices contributed to a rebound in the were made during the period in the assumed level prices of consumer goods. The latest data on of adjustment plus seasonal borrowing used in labor compensation suggested no easing of labor constructing the target paths for the provision of cost pressures. Average hourly earnings jumped reserves, and actual borrowing fell from about in October, although the year-over-year change $635 million in the first full maintenance period remained within the range of recent experience. after the early October meeting to around $200 In the broader-based employment cost index, million in the week prior to this meeting. The growth of wages and salaries continued to show federal funds rate declined from slightly above 9 a persistent updrift through the third quarter on a percent at the time of the October meeting to year-over-year basis in most industry and occu- around 8V2 percent more recently. pational groupings; growth of benefits had Most short- and intermediate-term interest slowed but remained at a high rate mainly be- rates fell by amounts comparable to the decline cause of rising health insurance costs. in the federal funds rate, though Treasury bill At its meeting on October 3, the Committee rates dropped by less as a result of disruptions adopted a directive that called for maintaining and supply pressures associated in part with the existing degree of pressure on reserve posi- delays in debt-ceiling legislation. Yields on most tions and that provided for giving particular bonds and fixed-rate mortgages also fell someweight to developments that might require some what less than the federal funds rate. Rates on slight easing during the intermeeting period. The lower-quality bonds rose appreciably, and stock Committee agreed that slightly greater reserve prices were considerably lower on balance in this restraint might be acceptable, or slightly lesser period. In the days following the October 13 reserve restraint would be acceptable, in the break in stock prices, the Committee held a intermeeting period depending on progress number of telephone conferences to assess detoward price stability, the strength of the busi- velopments in financial markets. At these and a ness expansion, the behavior of the monetary subsequent consultation, the Committee also disaggregates, and developments in foreign ex- cussed the decisions to ease reserve conditions change and domestic financial markets. The con- during the intermeeting period. templated reserve conditions were expected to In foreign exchange markets, the tradebe consistent with growth of M2 and M3 over the weighted value of the dollar in terms of the other period from September through December at G-10 currencies declined slightly further on balannual rates of about 6V2 percent and 4V2 percent ance over the intermeeting period. During the respectively. first part of the period, the dollar had appreciated After the Committee meeting, open market somewhat despite substantial intervention sales operations were directed initially toward main- of dollars by central banks and increases in taining the existing degree of pressure on reserve official interest rates in a number of major induspositions. For a few days after the steep drop in trial countries. Following the drop in stock prices Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the Federal Open Market Committee 57 in mid-October, the dollar moved lower. Expec- on labor and other production resources extations of further increases in interest rates pected to ease only marginally, little improveabroad and of lower rates in the United States ment was anticipated in the underlying trend of apparently contributed to the dollar's decline. inflation over the next several quarters. Expansion of the monetary aggregates picked In the Committee's discussion of the economic up in October. A surge in demand deposits in situation and outlook, members commented that early October contributed to considerable broad economic indicators and local conditions strength in Ml. The effects of this acceleration in different parts of the country pointed on balwere offset to an extent by slower expansion of ance to a sustained expansion in business activthe retail-type components of M2, possibly re- ity, though at a somewhat slower pace than in flecting the waning effects of earlier declines in recent quarters. Views differed to some extent market interest rates on the opportunity costs of regarding the risks of a different outcome, reholding liquid savings-type deposits included in flecting uncertainties concerning developments M2. The faster growth of M3, while remaining in such key sectors of the economy as business well below that of M2, reflected an accelerated investment and net exports and in the demand for issuance of large-denomination CDs by banks to housing and consumer durables, notably motor help finance substantially stronger expansion of vehicles. While some members regarded those bank credit. Runoffs of assets at capital-deficient risks as about evenly balanced in both directions, thrift institutions and associated declines in RPs a number stressed that a period of minimal and large-denomination CDs continued to re- growth or even a downturn in activity could not strain growth of M3. For the period from the be ruled out; others saw greater odds that the fourth quarter of 1988 through October, growth rate of economic growth and levels of resource of M2 was within the lower half of the Commit- utilization might be closer to the economy's tee's annual range, while expansion of M3 was potential. With regard to the outlook for inflanear the lower end of its range. tion, several members observed that the pros- The staff projection prepared for this meeting pects for significant progress were limited for the suggested that the economy was likely to grow at next several quarters, especially in light of the a slower pace over the next several quarters. The tendency for increases in labor costs to remain in outlook for the near term was clouded by uncer- a relatively high range. Other members extainties associated with the effects of a major pressed greater confidence that appreciable proghurricane, a severe earthquake, and a strike at a ress would be made, partly in the context of large manufacturer of aircraft. On balance, those reduced growth in economic activity. developments were projected to curb overall In their discussion of specific developments growth somewhat in the current quarter but to relating to the outlook for overall business activprovide a temporary boost in the first quarter of ity, members noted that economic conditions had next year. The projection assumed that the bud- softened in some parts of the country, with get deficit would decline moderately and that net manufacturing tending to weaken more generexports would make little contribution to domes- ally, particularly in the automotive and automotic growth in 1990. Consumer demand was ex- tive-related sectors. Many business contacts appected to buoy the near-term expansion of the peared to be less optimistic about prospects for economy, reflecting the strong growth of the real sales and more cautious about investment deciincome of consumers in recent months and indi- sions. Real estate markets and nonresidential cations of a continued high level of consumer construction ranged from quite weak to moderconfidence. Over the rest of the projection pe- ately strong in different sections of the country. riod, however, steadily mounting slack in labor On balance, local business conditions were charmarkets was expected to exert a restraining acterized by steady activity or slow growth in effect on consumer demand. The projection con- many regions to continued fairly vigorous expantinued to indicate substantial slackening in the sion in some others. expansion of business capital spending from the With regard to broad indicators of economic pace in the first half of this year. With pressures performance, members cited the continuing Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

58 Federal Reserve Bulletin • February 1990 weakness, but absence of further deterioration, suggestion to retain the current asymmetry in new orders. Order backlogs, while below toward ease that had been incorporated in recent earlier highs, appeared consistent with sustained directives. While current indicators of economic production. From a different perspective, it was activity suggested a somewhat weaker expannoted that commodity prices remained high and sion, most of the members agreed that a steady did not suggest a slowdown in economic activity. policy course was desirable at this point, espe- Business investment was an area of major uncer- cially in light of the stimulus provided by recent tainty in the economic outlook. Developments easing actions, whose effects on the economy that could have adverse implications for invest- would be felt only with some lag. In reconciling ment included a squeeze on profit margins from concerns about a cumulative weakening in the rising costs, both interest and labor expenses, on economy against a desire for progress in the fight the one hand and from competitive pressures that against inflation, a steady policy seemed to give restrained price increases on the other. On the reasonable prospects for achieving both susforeign side, the earlier appreciation of the dollar tained expansion and declining inflation. Some had arrested the improvement in the nation's members commented that these objectives could trade balance, but further gains still might be be attained with less pressure in credit markets if forthcoming at current dollar levels, given expec- the federal budget deficit were to turn more tations of relatively strong growth in business definitely downward. activity in foreign industrial countries. Such a In the course of the Committee's discussion, a development would have favorable implications number of members observed that, as a result of for the manufacturing sector and for the domestic the pickup in M2 over the course of the past expansion more generally. several months, growth of the monetary aggre- Views on the outlook for inflation differed to gates seemed consistent with the Committee's some extent, depending in part on somewhat long-run goals, and thus money growth did not in varying expectations with regard to the level of itself suggest the need for any current adjustment business activity and associated pressures on in reserve conditions. According to a staff analproduction resources. Several members contin- ysis prepared for this meeting, growth of M2 was ued to expect that, in light of the behavior of likely to remain relatively brisk, assuming unlabor costs, little or no progress would be made changed reserve conditions and steady interest in reducing inflation over the quarters ahead, rates. Growth of this aggregate would be buoyed even assuming relatively slow growth in business by the further decline that had occurred recently activity. Labor markets might be softening in in market interest rates and in the related opporsome areas, but data on labor compensation tunity costs of holding M2 balances, and for the showed no changes from earlier trends, and some year as a whole M2 was likely to expand at a rate members remained concerned that underlying just below the midpoint of the Committee's range demand conditions would be associated with for 1989. M3 was projected to continue to grow at persisting upward pressures on labor costs. a slower pace than M2, reflecting the ongoing Other members were more optimistic. They though waning effects on some M3 components noted that the behavior of prices had been better of the disposition of assets by undercapitalized than might have been anticipated in recent quar- thrift institutions and the funding made available ters, apparently reflecting a variety of factors through RTC resolutions; for the year, the that were tending to arrest the momentum of growth of M3 was projected to be somewhat inflation, including ongoing efforts to hold down above the lower bound of the Committee's range. costs in the context of strong competition in Turning to the instruction in the directive international and domestic markets. relating to possible adjustments in the degree of In the Committee's discussion of policy for the reserve pressure during the intermeeting period, weeks immediately ahead, nearly all of the mem- a majority of the members expressed a preferbers supported a proposal to maintain unchanged ence for retaining the existing asymmetry that conditions of reserve availability. A majority would permit any adjustments to be made more favored and the others could accept a related readily toward easing than toward firming. In this Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the Federal Open Market Committee 59 view, current tendencies toward weakening in domestic policy directive was issued to the Fedthe economy outweighed the sources of strength, eral Reserve Bank of New York: and some further easing might be needed if the incoming information on business activity sug- The information reviewed at this meeting suggests gested more softening than most members cur- continuing expansion in economic activity, though at a rently expected. In these circumstances, an eas- somewhat slower pace than earlier in the year. Total nonfarm payroll employment increased appreciably in ing would be consistent with the Committee's October, but on balance its growth has been more long-run inflation objective. Other members, moderate over the past several months, especially in who saw the risks to the expansion as more the private sector. The civilian unemployment rate has evenly balanced, indicated a preference for a remained around 5V4 percent. Strike activity and other symmetric instruction in the directive; however, disruptions depressed industrial production noticeably in October. Retail sales fell appreciably in October, they could accept retention of the bias toward reflecting a sharp drop in purchases of motor vehicles, ease contained in the October 3 directive. Some but some upward revisions were made for August and of these members nonetheless stressed the desir- September. Housing starts fell further in September ability of not overreacting to possible indications and for the third quarter as a whole were about of slower economic growth in the period ahead unchanged from their reduced second-quarter average. Indicators of business capital spending suggest for fear of creating financial conditions and stimslower growth after a substantial increase in the first ulating monetary growth that would prove to be half of the year. The nominal U.S. merchandise trade inconsistent with the Committee's long-run goal deficit widened in August from its July rate as non-oil of price stability. In light of these considerations imports increased markedly. Consumer prices have and in the context of the recent easing actions, risen more slowly on balance since midyear, partly reflecting sharp reductions in energy prices, but the the members generally endorsed or found acceptlatest data on labor compensation suggest no signifiable a proposal to approach with caution any cant change in prevailing trends. further easing in the weeks ahead. Most interest rates have declined appreciably since At the conclusion of the Committee's discus- the Committee meeting on October 3. In foreign exsion, all but one of the members indicated that change markets, the trade-weighted value of the dollar in terms of the other G-10 currencies declined slightly they preferred or could accept a directive that on balance over the intermeeting period. called for maintaining the existing degree of M2 continued to grow fairly briskly in October, pressure on reserve positions and that provided largely reflecting strength in its Ml and other liquid for giving greater weight to developments that components; thus far this year M2 has expanded at a might require some slight easing during the inter- pace somewhat below the midpoint of the Committee's annual range. Growth of M3 picked up in Octomeeting period. Accordingly, slightly greater reber but has remained much more restrained than that serve restraint might be acceptable during the of M2, as assets of thrift institutions and their associintermeeting period, while some slight easing of ated funding needs apparently continued to contract; reserve restraint would be acceptable, depending for the year to date, M3 has grown at a rate around the on progress toward price stability, the strength of lower bound of the Committee's annual range. The Federal Open Market Committee seeks monethe business expansion, the behavior of the montary and financial conditions that will foster price etary aggregates, and developments in foreign stability, promote growth in output on a sustainable exchange and domestic financial markets. The basis, and contribute to an improved pattern of interreserve conditions contemplated by the Commit- national transactions. In furtherance of these objectee were expected to be consistent with growth tives, the Committee at its meeting in July reaffirmed the ranges it had established in February for growth of of M2 and M3 at annual rates of around IV2 M2 and M3 of 3 to 7 percent and 31/2 to 7V2 percent, percent and AVi percent respectively over the respectively, measured from the fourth quarter of 1988 three-month period from September to Decem- to the fourth quarter of 1989. The monitoring range for ber. The intermeeting range for the federal funds growth of total domestic nonfinancial debt also was rate, which provides one mechanism for initiat- maintained at 6V2 to 10!/2 percent for the year. For 1990, on a tentative basis, the Committee agreed in ing consultation of the Committee when its July to use the same ranges as in 1989 for growth in boundaries are persistently exceeded, was left each of the monetary aggregates and debt, measured unchanged at 7 to 11 percent. from the fourth quarter of 1989 to the fourth quarter of At the conclusion of the meeting, the following 1990. The behavior of the monetary aggregates will Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

60 Federal Reserve Bulletin • February 1990 continue to be evaluated in the light of movements in likely to be associated with a federal funds rate pertheir velocities, developments in the economy and sistently outside a range of 7 to 11 percent. financial markets, and progress toward price level stability. Votes for this action: Messrs. Greenspan, Cor- In the implementation of policy for the immediate rigan, Angell, Guffey, Johnson, Keehn, Kelley, future, the Committee seeks to maintain the existing LaWare, Melzer, and Syron. Vote against this degree of pressure on reserve positions. Taking ac- action: Ms. Seger. count of progress toward price stability, the strength of the business expansion, the behavior of the mone- Ms. Seger dissented because she felt that a tary aggregates, and developments in foreign exchange further easing of monetary policy was needed at and domestic financial markets, slightly greater rethis time. In her view, the persisting weakness in serve restraint might or slightly lesser reserve restraint would be acceptable in the intermeeting period. The the manufacturing sector, most notably in motor contemplated reserve conditions are expected to be vehicles, along with a likely softening in conconsistent with growth of M2 and M3 over the period struction activity and capital expenditures posed from September through December at annual rates of a substantial risk to the economy. In these cirabout IVi and Mi percent, respectively. The Chairman cumstances, a moderate easing of policy could may call for Committee consultation if it appears to the Manager for Domestic Operations that reserve condi- help forestall a slide into recession in the months tions during the period before the next meeting are ahead without adding to inflationary pressures. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

61 Legal Developments AMENDMENT TO REGULATION B 3. Section 202.3 is amended by removing paragraph (d) and redesignating paragraph (e) as paragraph (d). The Board of Governors is amending 12 C.F.R. Part 4. Section 202.9 is amended by adding paragraph 202, its Regulation B (Equal Credit Opportunity). The (a)(3). Paragraphs (a)(1) and (2) are republished to read amendments mandate that creditors give written notice as follows: to business applicants of the right to a written statement (1) Notification of action taken, ECOA notice, and of reasons for a credit denial. Creditors are also re- statement of specific reasons—(1) When notification quired to retain records relating to business credit is required. A creditor shall notify an applicant of applications for at least one year. action taken within: The revisions to Regulation B implement the statu- (i) 30 days after receiving a completed application tory amendments and define coverage based on a credit concerning the creditor's approval of, counterapplicant's gross revenues. Creditors must provide offer to, or adverse action on the application; written notices and retain records in accordance with (ii) 30 days after taking adverse action on an the new law on credit applications involving businesses incomplete application, unless notice is provided with gross revenues of $1 million or less. Applications in accordance with paragraph (c) of this section; from businesses with gross revenues greater than $1 (iii) 30 days after taking adverse action on an million and applications for trade credit and similar existing account; or types of business credit are subject to modified notice (iv) 90 days after notifying the applicant of a and recordkeeping rules provided in Regulation B. counteroffer if the applicant does not expressly Business credit transactions, regardless of the revenue accept or use the credit offered. size of the business, remain covered by all other rele- (2) Content of notification when adverse action is vant provisions of the Equal Credit Opportunity Act taken. A notification given to an applicant when and Regulation B. adverse action is taken shall be in writing and shall Effective December 8, 1989, but mandatory compli- contain: a statement of the action taken; the name ance is not required until April 1, 1990, 12 C.F.R. Part and address of the creditor; a statement of the 202 is amended as follows: provisions of section 701(a) of the Act; the name and address of the Federal agency that administers com- Part 202—Equal Credit Opportunity pliance with respect to the creditor; and either: (i) A statement of specific reasons for the action 1. The authority citation for Part 202 is revised to read taken; or as follows: (ii) A disclosure of the applicant's right to a statement of specific reasons within 30 days, if the Authority: 15 U.S.C. 1691-1691f. statement is requested within 60 days of the creditor's notification. The disclosure shall in- 2. Section 202.2 is amended by revising paragraph (g) clude the name, address, and telephone number of to read as follows: the person or office from which the statement of reasons can be obtained. If the creditor chooses to provide the reasons orally, the creditor shall also Section 202.2—Definitions disclose the applicant's right to have them confirmed in writing within 30 days of receiving a written request for confirmation from the appli- (g) Business credit refers to extensions of credit pri- cant. marily for business or commercial (including agricul- (3) Notification to business credit applicants. For tural) purposes, but excluding extensions of credit of business credit, a creditor shall comply with the the types described in section 202.3(a), (b), and (d). requirements of this paragraph in the following manner: (i) With regard to a business that had gross Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

62 Federal Reserve Bulletin • February 1990 revenues of $1,000,000 or less in its preceding an applicant of adverse action regarding an existing fiscal year (other than an extension of trade credit, account, the creditor shall retain as to that account, credit incident to a factoring agreement, or other in original form or a copy thereof: similar types of business credit), a creditor shall (i) Any written or recorded information concerncomply with paragraphs (a)(1) and (2), except ing the adverse action; and that: (ii) Any written statement submitted by the appli- (A) The statement of the action taken may be cant alleging a violation of the act or this regulagiven orally or in writing, when adverse action tion. is taken; (3) Other applications. For 25 months (12 months (B) Disclosure of an applicant's right to a state- for business credit) after the date that a creditor ment of reasons may be given at the time of receives an application for which the creditor is not application, instead of when adverse action is required to comply with the notification requiretaken, provided the disclosure is in a form the ments of section 202.9, the creditor shall retain all applicant may retain and contains the informa- written or recorded information in its possession tion required by paragraph (a)(2)(ii) and the concerning the applicant, including any notation of ECO A notice specified in paragraph (b)(1) of action taken. this section; (4) Enforcement proceedings and investigations. A (C) For an application made solely by tele- creditor shall retain the information specified in this phone, a creditor satisfies the requirements of section beyond 25 months (12 months for business this paragraph by an oral statement of the credit) if it has actual notice that it is under investiaction taken and of the applicant's right to a gation or is subject to an enforcement proceeding for statement of reasons for adverse action. an alleged violation of the act or this regulation by (ii) With regard to a business that had gross the Attorney General of the United States or by an revenues in excess of $1,000,000 in its preceding enforcement agency charged with monitoring that fiscal year or an extension of trade credit, credit creditor's compliance with the act and this regulaincident to a factoring agreement, or other similar tion, or if it has been served with notice of an action types of business credit, a creditor shall: filed pursuant to section 706 of the Act and section (A) Notify the applicant, orally or in writing, 202.14 of this regulation. The creditor shall retain within a reasonable time of the action taken; the information until final disposition of the matter, and unless an earlier time is allowed by order of the agency or court. (B) Provide a written statement of the reasons for adverse action and the ECOA notice speci- (5) Special rule for certain business credit applicafied in paragraph (b)(1) of this section if the tions. With regard to a business with gross revenues applicant makes a written request for the rea- in excess of $1,000,000 in its preceding fiscal year, sons within 60 days of being notified of the or an extension of trade credit, credit incident to a adverse action. factoring agreement or other similar types of business credit, the creditor shall retain records for at least 60 days after notifying the applicant of the 5. Section 202.12 is amended by revising paragraph action taken. If within that time period the applicant (b)(1) introductory text and paragraphs (b)(2)-(4) and requests in writing the reasons for adverse action or adding paragraph (b)(5) to read as follows: that records be retained, the creditor shall retain records for 12 months. Section 202.12—Record Retention 5. Appendix C is amended by revising the first and last (b) Preservation of records— paragraph of the introduction, and by adding sample (1) Applications. For 25 months (12 months for forms C-7 and C-8 to read as follows: business credit) after the date that a creditor notifies an applicant of action taken on an application or of incompleteness, the creditor shall retain in original APPENDIX C—SAMPLE NOTIFICATION FORMS form or a copy thereof: This appendix contains eight sample notification forms. Forms C-l through C-4 are intended for use in (2) Existing accounts. For 25 months (12 months for notifying an applicant that adverse action has been business credit) after the date that a creditor notifies taken on an application or account under section Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 63 202.9(a)(1) and (2)(i) of this regulation. Form C-5 is a APPENDIX A—FEDERAL ENFORCEMENT notice of disclosure of the right to request specific AGENCIES reasons for adverse action under section 202.9(a)(1) and (2)(ii). Form C-6 is designed for use in notifying an Appendix A is amended by removing the reference to applicant, under section 202.9(c)(2), that an applica- "Savings Institutions Insured by the FSLIC and Memtion is incomplete. Forms C-7 and C-8 are intended for bers of the FHLB System," the parenthetical inforuse in connection with applications for business credit mation that follows, and the next full sentence, and under section 202.9(a)(3). adding the following words in place thereof: Savings institutions insured under the Savings Association Insurance Fund of the FDIC and federal- A creditor may design its own notification forms or ly-chartered savings banks insured under the Bank use all or a portion of the forms contained in this Insurance Fund of the FDIC (but not including appendix. Proper use of Forms C-l through C-4 will state-chartered savings banks insured under the satisfy the requirements of section 202.9(a)(2)(i). Bank Insurance Fund). Proper use of Forms C-5 and C-6 constitutes full The District Director of the Office of Thrift Supercompliance with sections 202.9(a)(2)(ii) and vision in the District in which the institution is 202.9(c)(2), respectively. Proper use of Forms C-7 and located. C-8 will satisfy the requirements of sections 202.9(a)(2)(i) and (ii), respectively, for applications for business credit. Part 205—Electronic Fund Transfers 1. The authority citation for Part 205 continues to read as follows: AMENDMENTS TO REGULATIONS B, E, M, AND Z Authority: Pub. L. 95-630, 92 Stat. 3730 (15 U.S.C. 1693b). The Board of Governors is amending 12 C.F.R. Parts 202, 205, 213, and 226, its Regulations B, E, M, and Z (Equal Credit Opportunity, Electronic Fund Trans- Section 205.13—Administrative Enforcement fers, Consumer Leasing, and Truth in Lending), to reflect the transfer of enforcement functions from the Federal Home Loan Bank Board to the Office of Section 205.13(a)(1) is amended by removing the ref- Thrift Supervision, pursuant to the recent Financial erence to the Federal Home Loan Bank Board and the Institution Reform, Recovery and Enforcement Act parenthetical information that follows, and adding the ("FIRREA") legislation. words "Office of Thrift Supervision" in its place. Effective December 29, 1989, 12 C.F.R. Parts 202, 205, 213, and 226, are amended as follows: APPENDIX B—FEDERAL ENFORCEMENT Part 202—Equal Credit Opportunity AGENCIES 1. The authority citation for Part 202 continues to read Appendix B is amended by removing the reference to as follows: "Savings Institutions Insured by the FSLIC and Members of the FHLB System," the parenthetical infor- Authority: 15 U.S.C. 1691-1691f. mation that follows, and the next full sentence, and adding the following words in place thereof: Savings Institutions insured under the Savings As- Section 202.14—Enforcement, Penalties, and sociation Insurance Fund of the FDIC and federally-chartered savings banks insured under the Bank Liabilities Insurance Fund of the FDIC (but not including state-chartered savings banks insured under the Section 202.14(a)(1) is amended by removing the ref- Bank Insurance Fund). erence to the Federal Home Loan Bank Board and the The District Director of the Office of Thrift Superparenthetical information that follows, and adding the vision in the District in which the institution is words "Office of Thrift Supervision" in its place. located. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

64 Federal Reserve Bulletin • February 1990 Part 213—Consumer Leasing The District Director of the Office of Thrift Supervision in the District in which the institution is 1. The authority citation for Part 213 continues to read located. as follows: Authority: Sec. 105, Truth in Lending Act, as amended FINAL RULE—REVISION TO REGULATION C by sec. 605, Pub. L. 92-221, 94 Stat. 170 (15 U.S.C. 1604). The Board of Governors is revising 12 C.F.R. Part 203, its Regulation C (Home Mortgage Disclosure). The regulation implements amendments to the Home Mortgage APPENDIX D—FEDERAL ENFORCEMENT Disclosure Act ("HMDA"), contained in the Financial AGENCIES Institutions Reform, Recovery and Enforcement Act ("FIRREA"), which are effective on January 1,1990. The Appendix D is amended by removing the reference to FIRREA amendments expand the coverage of HMDA to "Savings Institutions Insured by the FSLIC and Mem- include mortgage lenders that are not affiliated with debers of the FHLB System," the parenthetical infor- pository institutions or holding companies. They require mation that follows, and the next full sentence, and covered institutions to report data regarding applications adding the following words in place thereof: for mortgage and home improvement loans, in addition to Savings Institutions insured under the Savings As- data regarding loan originations and purchases. Most sociation Insurance Fund of the FDIC and federal- institutions will now also report the race, sex, and income ly-chartered savings banks insured under the Bank of loan applicants. Insurance Fund of the FDIC (but not including The Board has adopted a loan/application register state-chartered savings banks insured under the form for HMDA reporting on which institutions will Bank Insurance Fund). record the required information for loan applications, The District Director of the Office of Thrift Super- loans actually made, and loans purchased. vision in the District in which the institution is The first set of reports in the new register format will be located. due in early 1991. The reports covering loan data for calendar year 1989, which are due on March 31, 1990, remain subject to the existing provisions of the regulation; Part 226—Truth in Lending institutions must use the current Form HMDA-1 or HMDA-2, as appropriate, for those reports. 1. The authority citation for Part 226 continues to read Effective January 1, 1990, 12 C.F.R. Part 203 is as follows: revised as follows: Authority: Truth in Lending Act, 15 U.S.C. 1604 and Part 203—Home Mortgage Disclosure sec. 2, Public Law 100-583, 102 Stat. 2960; sec. 1204(c), Competitive Equality Banking Act, Public Section 203.1—Authority, purpose, and scope Law 100-86, 101 Stat. 552. Section 203.2—Definitions Section 203.3—Exempt institutions Section 203.4—Compilation of loan data Section 203.5—Disclosure and reporting APPENDIX I—FEDERAL ENFORCEMENT Section 203.6—Enforcement AGENCIES Appendix A Form and instructions for loan/application register Appendix I is amended by removing the reference to Appendix B Form and instructions for data collection "Savings Institutions Insured by the FSLIC and Mem- on race or national origin and sex bers of the FHLB System," the parenthetical information that follows, and the next full sentence, and Authority: 12 U.S.C. 2801-2810 adding the following words in place thereof: Savings Institutions insured under the Savings As- Section 203.1—Authority, purpose, and scope sociation Insurance Fund of the FDIC and federally-chartered savings banks insured under the Bank (a) Authority. This regulation is issued by the Board of Insurance Fund of the FDIC (but not including Governors of the Federal Reserve System ("Board") state-chartered savings banks insured under the pursuant to the Home Mortgage Disclosure Act Bank Insurance Fund). (12 U.S.C. 2801 et seq.), as amended. The informa- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 65 tion-collection requirements have been approved by free-standing electronic terminals such as autothe U.S. Office of Management and Budget under mated teller machines; 44 U.S.C. 3501 et seq. and have been assigned OMB (2) any office of a mortgage lending institution (other No. 7100-0247. than a bank, savings association, or credit union) (b) Purpose. that takes applications from the public for home (1) This regulation implements the Home Mortgage purchase or home improvement loans. A mortgage Disclosure Act, which is intended to provide the lending institution is also deemed to have a branch public with loan data that can be used: office in an MSA if, in the preceding calendar year, (i) to help determine whether financial institutions it received applications for, originated, or purchased are serving the housing needs of their communities; five or more home purchase or home improvement (ii) to assist public officials in distributing public- loans on property located in that MSA. sector investments so as to attract private invest- (d) Dwelling means a residential structure (whether or ment to areas where it is needed; and not it is attached to real property) located in a state of (iii) to assist in identifying possible discriminatory the United States of America, the District of Columlending patterns and enforcing antidiscrimination bia, or the Commonwealth of Puerto Rico. The term statutes. includes an individual condominium unit, cooperative (2) Neither the act nor this regulation is intended to unit, or mobile or manufactured home. encourage unsound lending practices or the alloca- (e) Financial institution means: (1) a bank, savings assotion of credit. ciation, or credit union that originated in the preceding (c) Scope. This regulation applies to certain financial calendar year a home purchase loan (other than tempoinstitutions, including banks, saving associations, rary financing such as a construction loan) secured by a credit unions, and other mortgage lending institutions, first lien on a one-to-four family dwelling if: as defined in section 203.2(e). It requires an institution (i) the institution is federally insured or regulated; or to report data to its supervisory agency about home (ii) the loan is insured, guaranteed, or supplepurchase and home improvement loans it originates or mented by any federal agency; or purchases, or for which it receives applications; and to (iii) the institution intended to sell the loan to the disclose certain data to the public. Federal National Mortgage Association or the (d) Loan aggregation and central data depositories. Federal Home Loan Mortgage Corporation; Using the loan data made available by financial insti- (2) a for-profit mortgage lending institution (other tutions, the Federal Financial Institutions Examina- than a bank, savings association, or credit union) tion Council will prepare disclosure statements and whose home purchase loan originations equaled or will produce various reports for individual institutions exceeded ten percent of its loan volume, measured for each metropolitan statistical area (MSA), showing in dollars, in the preceding calendar year. lending patterns by location, age of housing stock, (f) Home improvement loan means any loan that: income level, sex, and racial characteristics. The (1) is stated by the borrower (at the time of the loan disclosure statements and reports will be available to application) to be for the purpose of repairing, the public at central data depositories located in each rehabilitating, or remodeling a dwelling; and MSA. A listing of central data depositories can be (2) is classified by the financial institution as a home obtained from the Federal Financial Institutions Ex- improvement loan. amination Council, Washington, D.C. 20006. (g) Home purchase loan means any loan secured by and made for the purpose of purchasing a dwelling. (h) Metropolitan statistical area or MSA means a Section 203.2—Definitions metropolitan statistical area or a primary metropolitan statistical area, as defined by the U.S. Office of Man- In this regulation: agement and Budget. (a) Act means the Home Mortgage Disclosure Act (12 U.S.C. 2801 et seq.), as amended. Section 203.3—Exempt institutions (b) Application means an oral or written request for a home purchase or home improvement loan that is made in accordance with procedures established by a (a) Exemption based on asset size or location. A financial institution for the type of credit requested. financial institution is exempt from the requirements of (c) Branch office means: this regulation for a given calendar year if on the (1) any office of a bank, savings association, or preceding December 31: credit union that is approved as a branch by a (1) the institution had neither a home office nor a federal or state supervisory agency, but excludes branch office in an MSA; or Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

66 Federal Reserve Bulletin • February 1990 (2) in the case of a bank, savings association, or (6) The location of the property to which the loan credit union, the institution's total assets were relates, by MSA, state, county, and census tract, if the $10 million or less; or institution has a home or a branch office in that MSA. (3) in the case of a for-profit mortgage lending (7) The race or national origin and sex of the institution (other than a bank, savings association, applicant or borrower, and the income relied upon in or credit union), the total assets of the institution processing the loan application. combined with those of any parent corporation were (8) The type of entity purchasing a loan that the $10 million or less. institution originates or purchases and then sells (b) Exemption based on state law. within the same calendar year. (1) A state-chartered or state-licensed financial in- (b) Collection of data on race or national origin, sex, stitution is exempt from the requirements of this and income. regulation if the Board determines that the institu- (1) A financial institution shall collect data about the tion is subject to a state disclosure law that contains race or national origin and sex of the applicant or requirements substantially similar to those imposed borrower as prescribed in Appendix B. If the appliby this regulation and contains adequate provisions cant or borrower chooses not to provide the inforfor enforcement. mation, the lender shall note that data on the basis of (2) Any state, state-chartered or state-licensed fi- visual observation or surname, to the extent possinancial institution, or association of such institu- ble. tions may apply to the Board for an exemption (2) Race or national origin, sex, and income data under this paragraph. may but need not be collected for: (3) An institution that is exempt under this para- (i) loans purchased by the financial institution; or graph shall submit the data required by the state (ii) applications received or loans originated by a disclosure law to its state supervisory agency for bank, savings association, or credit union with purposes of aggregation. assets on the preceding December 31 of $30 (c) Loss of exemption. million or less. (1) An institution losing an exemption that was (c) Optional data. A financial institution may report based on asset size or location under paragraph (a) the reasons it denied a loan application. of this section shall comply with this regulation (d) Excluded data. A financial institution shall not beginning with the calendar year in which it lost its report: exemption. (1) loans originated or purchased by the financial (2) An institution losing an exemption that was institution acting in a fiduciary capacity (such as based on state law under paragraph (b) of this trustee); section shall comply with this regulation beginning (2) loans on unimproved land; with the calendar year following the year for which (3) temporary financing (such as bridge or construcit last reported loan data under the state disclosure tion loans); law. (4) the purchase of an interest in a pool of loans (such as mortgage-participation certificates); or (5) the purchase solely of the right to service loans. Section 203.4—Compilation of loan data Section 203.5—Disclosure and reporting (a) Data format and itemization. A financial institution (a) Reporting requirements. By March 1 following the shall collect data regarding applications for, and orig- calendar year for which the loan data are compiled, a inations and purchases of, home purchase loans (in- financial institution shall send two copies of its comcluding refinancings) and home improvement loans for plete register to the agency office specified in Appeneach calendar year. These data shall be presented on a dix A of this regulation, and shall retain a copy for its register in the format prescribed in Appendix A and records for a period of not less than two years. shall include the following items: (b) Disclosure to the public. A financial institution (1) A number for the loan or loan application, and shall make its mortgage loan disclosure statement (to the date the application was received. be prepared by the Federal Financial Institutions (2) The type and purpose of the loan. Examination Council) available to the public no later (3) The owner-occupancy status of the property to than 30 calendar days after the institution receives it which the loan relates. from its supervisory agency. The financial institution (4) The amount of the loan or application. shall make the statement available to the public for a (5) The type of action taken, and the date. period of five years. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 67 (c) Availability of disclosure statement. A financial For depository institutions that report weekly, the institution shall make the disclosure statement avail- low reserve tranche adjustment will be effective startable at its home office. If it has a physical branch office ing with the reserve computation period beginning in other MS As, it shall also make a statement available Tuesday, December 26, 1989, and with the correin at least one branch office in each of those MS As; the sponding reserve maintenance periods beginning statement at a branch office need only contain data Thursday, December 28, 1989, for net transaction relating to property in the MSA where that branch accounts, and Thursday, January 25, 1990, for other office is located. An institution shall make the disclo- reservable liabilities. For institutions that report quarsure statement available for inspection and copying terly, the low reserve tranche adjustment will be during the hours the office is normally open to the effective with the computation period beginning Tuespublic for business. It may impose a reasonable charge day, December 19, 1989, and with the reserve maintefor photocopying services. nance period beginning Thursday, January 18, 1990. (d) Notice of availability. A financial institution shall For all depository institutions, the increase in the post a general notice about the availability of its deposit cutoff level will be used to screen institutions disclosure statement in the lobbies of its home office in the second quarter of 1990 to determine reporting and any physical branch offices located in an MSA. frequency beginning September 1990. Upon request, it shall promptly provide the location of Pursuant to the Board's authority under section 19 the institution's offices where the statement is avail- of the Federal Reserve Act, 12 U.S.C. § 461 et seq., able. At its option, an institution may include the 12 C.F.R. Part 204 is amended as follows: location in its notice. Part 204—Reserve Requirements of Depository Section 203.6—Enforcement Institutions (a) Administrative enforcement. A violation of the act 1. The authority citation for 12 C.F.R. Part 204 conor this regulation is subject to administrative sanctions tinues to read as follows: as provided in section 305 of the act. Compliance is enforced by the agencies listed in Appendix A of this Authority: Sections 11(a), 11(c), 19, 25, 25(a) of the regulation. Federal Reserve Act (12 U.S.C. §§ 248(a), 248(c), (b) Bona fide errors. An error in compiling or record- 371a, 371b, 461, 601, 611); section 7 of the Internaing loan data is not a violation of the act or this tional Banking Act of 1978 (12 U.S.C. § 3105); and regulation if it was unintentional and occurred despite section 411 of the Garn-St Germain Depository Instithe maintenance of procedures reasonably adapted to tutions Act of 1982 (12 U.S.C. § 461). avoid such errors. 2. In section 204.9, paragraph (a)(1) is revised to read as follows: AMENDMENT TO REGULATION D Section 204.9—Reserve requirement ratios The Board of Governors is amending 12 C.F.R. Part 204, its Regulation D (Reserve Requirements of De- (a)(1) Reserve percentages. The following reserve pository Institutions) to decrease the amount of trans- ratios are prescribed for all depository institutions, action accounts subject to a reserve requirement ratio Edge and Agreement Corporations, and United of three percent, as required by section 19(b)(2)(C) of States branches and agencies of foreign banks: the Federal Reserve Act (12 U.S.C. § 461(b)(2)(C)), from $41.5 million to $40.4 million of net transaction accounts (known as the low reserve tranche adjust- Category Reserve Requirement ment). The Board has left at $3.4 million the amount of reservable liabilities of each depository institution that Net transaction account1 $0 to $40.4 million 3 percent of amount is subject to reserve requirements of zero percent Over $40.4 million $1,212,000 plus 12 percent of (known as the reservable liabilities exemption adjust- amount over $40.4 million Nonpersonal time deposits ment), as required by section 19(b)(ll)(B) of the Fed- By original maturity eral Reserve Act (12 U.S.C. § 461(b)(ll)(B)). The (or notice period): Less than 1V2 years 3 percent Board has also increased from $42.1 million to $43.4 IV2 years or more 0 percent million the deposit cutoff level that is used in conjunc- Eurocurrency liabilities 3 percent tion with the reservable liabilities exemption amount 1. Dollar amounts do not reflect the adjustment to be made by the to determine the frequency of deposit reporting. next paragraph. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

68 Federal Reserve Bulletin • February 1990 ORDERS ISSUED UNDER BANK HOLDING The financial and managerial resources and future COMPANY ACT prospects of Appleton and Citizens Bank are consistent with approval. Considerations relating to the Orders Issued Under Section 3 of the Bank convenience and needs of the communities to be Holding Company Act served also are consistent with approval. Based on the foregoing and other facts of record, the Appleton City Bancshares, Inc. Board has determined that the application should be, Appleton City, Missouri and hereby is, approved. The proposal shall not be consummated before the thirtieth calendar day follow- Order Approving Formation of a Bank Holding ing the effective date of this Order, or later than three Company months after the effective date of this Order, unless such period is extended for good cause by the Board or Appleton City Bancshares, Inc., Appleton City, Mis- the Federal Reserve Bank of Kansas City, acting souri ("Appleton"), has applied for the Board's ap- pursuant to delegated authority. proval pursuant to section 3(a)(1) of the Bank Holding By order of the Board of Governors, effective Company Act ("Act"), (12 U.S.C. § 1841 et seq.), to December 7, 1989. become a bank holding company by acquiring 100 percent of the voting shares of Citizens Bank of Voting for this action: Chairman Greenspan and Governors Appleton City, Appleton City, Missouri ("Citizens Johnson, Seger, Angell, Kelley, and La Ware. Bank"). Notice of the application, affording interested per- JENNIFER J. JOHNSON Associate Secretary of the Board sons an opportunity to submit comments, has been duly published (54 Federal Register 42,991 (1989)). Barnett Banks, Inc. The time for filing comments has expired, and the Jacksonville, Florida Board has considered the application and all comments received in light of the factors set forth in Order Approving Acquisition of a Bank section 3(c) of the Act. Appleton is a non-operating company formed for the Barnett Banks, Inc., Jacksonville, Florida ("Barnett") purpose of acquiring Citizens Bank. Citizens Bank is has applied pursuant to section 3(a)(3) of the Bank one of the smaller commercial banking organizations Holding Company Act of 1956 ("BHC Act") in Missouri, controlling deposits of $15.6 million, (12 U.S.C. § 1842(a)(3)) to acquire 100 percent of the representing less than one percent of total deposits in commercial banking organizations in the state.1 This voting shares of Barnett Bank of Southwest Georgia, Columbus, Georgia ("Bank").1 Bank is the successor proposal represents a restructuring of existing ownerto Barnett's existing thrift institution subsidiary, Barship interests. Consummation of this proposal would nett Federal Savings Bank, Columbus, Georgia. not result in any significantly adverse effect on the Notice of the application, affording interested perconcentration of banking resources in Missouri. sons an opportunity to submit comments, has been Citizens Bank competes in the Bates County, Missouri, banking market,2 and its deposits represent published (54 Federal Register 41,163 (1989)). The time for filing comments has expired, and the Board approximately 9 percent of the total deposits in comhas considered the application and all comments remercial banking organizations in the market. Princiceived in light of the factors set forth in section 3(c) of pals of Appleton and Citizens Bank are not associated the BHC Act. with any other banking organization in the market. Barnett proposes to convert Bank from a federal Based on the facts of record, consummation of this savings bank to a state-chartered commercial bank. proposal would not result in any adverse effects upon The Financial Institutions Reform, Recovery, and competition or increase the concentration of banking resources in any relevant market. Accordingly, the Board concludes that competitive considerations are 1. Barnett currently controls Barnett Federal Savings Bank indiconsistent with approval of this application. rectly through two inactive intermediate tier holding company subsidiaries of Barnett: Suncoast Bancorp, Inc., Vero Beach, Florida ("Suncoast"); and its subsidiary, First City Bancorp, Inc., Marietta, Georgia ("First City"). First City is a Georgia savings bank holding 1. State banking data are as of December 31, 1987. Market data are company that directly controls Barnett Federal Savings Bank. Both as of December 31, 1988. Suncoast and First City join in this application. Barnett proposes to 2. The Bates County, Missouri, banking market is approximated by convert Bank from a federal savings association charter to a state Bates County, the Town of Montrose in Henry County, and the Town savings association charter and, immediately thereafter, from a state of Appleton City in St. Claire County, Missouri. savings association charter to a state commercial bank charter. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 69 Enforcement Act of 1989 ("FIRREA") established a locations permissible under relevant state law for a five-year moratorium on any transaction that involves Georgia bank to branch.8 Accordingly, approval of the transfer of deposits from one deposit insurance Barnett's proposal to acquire Bank is not barred by the fund to another with certain limited exceptions.2 As a Douglas Amendment. general matter, this moratorium prevents an institution Barnett is the 9th largest commercial banking orgawhose deposits are insured by the Savings Association nization operating in Georgia, controlling approxi- Insurance Fund ("SAIF") from converting to an insti- mately $837.6 million in deposits, representing approxtution the deposits of which are insured by the Bank imately 1.81 percent of the total deposits in Insurance Fund ("BIF").3 A provision of FIRREA commercial banks in the state.9 Bank is the 10th expressly provides that this moratorium does not largest thrift institution in Georgia with approximately apply to transactions in which a savings association $272.7 million in thrift deposits, representing approxthat is a member of the SAIF converts to a commercial imately 1.9 percent of the total deposits in thrift bank that remains a SAIF member.4 Under this excep- institutions in the state. Bank will operate in the tion, the resulting bank is required to continue to pay Columbus, Georgia, and Meriwether County, Georgia, the SAIF insurance premiums, but is not required to banking markets.10 Because Barnett already indirectly pay either the exit or entrance fees generally imposed controls Bank, this proposal will not result in the by FIRREA on conversion transactions.5 Barnett Fed- elimination of any existing competition in any relevant eral Savings Bank is currently a SAIF-member, and, banking market. In light of the facts of record, conupon its conversion into Bank, Bank proposes to summation of this proposal would not have a signifiremain a SAIF-member. Accordingly, the charter con- cantly adverse effect on competition in any relevant version proposed in this case is permissible under banking market. FIRREA. The financial and managerial resources and future Section 3(a)(3) of the BHC Act requires that a bank prospects of Barnett and Bank are consistent with holding company receive Board approval prior to approval. Considerations relating to the convenience taking any action to acquire a bank. Section 3(d) of the and needs of the communities to be served also are BHC Act, the Douglas Amendment, (12 U.S.C. consistent with approval. § 1842(d)), prohibits the Board from approving an Based on the foregoing and other facts of record, the application by a bank holding company to acquire a Board has determined that the application should be, bank located outside of the bank holding company's and hereby is, approved. The acquisition shall not be principal state of operations, unless the acquisition is consummated before the thirtieth calendar day follow- "specifically authorized by the statute laws of the state ing the effective date of this Order, or later than three in which such bank is located, by language to that months after the effective date of this Order, unless effect and not merely by implication."6 Barnett's such period is extended for good cause by the Board or principal state of operations is Florida. The Board has by the Federal Reserve Bank of Atlanta, acting purpreviously determined that Georgia's interstate bank- suant to delegated authority. ing statute expressly authorizes a Florida holding By order of the Board of Governors, effective company, such as Barnett, to acquire a Georgia bank, December 15, 1989. such as Bank.7 Moreover, the branches of Bank are in Voting for this action: Chairman Greenspan and Governors Johnson, Seger, Kelley, and LaWare. Absent and not voting: 2. 12 U.S.C. § 1815(d)(2), as amended by Pub. L. No. 101-73, Governor Angell. § 206, 103 Stat. 183, 197 (1989). 3. Id. 4. 12 U.S.C. § 1815(d)(2)(G), as amended by Pub. L. No. 101-73, JENNIFER J. JOHNSON § 206(a)(7), 103 Stat. 183, 199 (1989). Associate Secretary of the Board 5. 12 U.S.C. § 1815(d)(2)(E), as amended by Pub. L. No. 101-73, § 206(a)(7), 103 Stat. 183, 198 (1989). 6. A bank holding company's principal state of operations for purposes of the Douglas Amendment is that state in which the operations of the holding company's banking subsidiaries were principally conducted on the later of July 1, 1966, or the date on which the company became a bank holding company. 7. Barnett Banks, Inc., 75 Federal Reserve Bulletin 585 (1989). Georgia's Regional Interstate Banking Act permits an out-of-state regional bank holding company to acquire a Georgia bank that has 8. See Ga. Code Ann. §§ 7-l-293(e), 7-1-550 et seq. been in existence and continuously operated for at least five years. 9. State deposit data as of June 30, 1989. Under the provisions of this Act, the term "bank" encompasses any 10. The Columbus, Georgia, banking market is approximated by federally-insured financial institution which accepts deposits and Chattahoochee County and Muscogee County in Georgia, plus Russell makes commercial loans. See Ga. Code Ann. § 7-1-620(2). Barnett County, Alabama, and the city of Smiths in Lee County, Alabama. Federal Savings Bank qualifies as a bank for purposes of these The Meriwether County banking market is approximated by Meriprovisions. wether County, Georgia. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

70 Federal Reserve Bulletin • February 1990 Orders Issued Under Section 4 of the Bank United Bank of Arizona into Bank. United has con- Holding Company Act ducted insurance agency activities pursuant to Arizona law since 1964. In 1969, United Bank of Arizona Citicorp became a subsidiary of UB Financial Corporation, a New York, New York registered bank holding company, and, since that time, United has been a wholly owned subsidiary of, first, G.W.B. Holding Company United Bank of Arizona, and, then, of Bank, in Phoenix, Arizona conformance with and reliance on section 225.22(d)(2)(H) of the Board's Regulation Y. Order Approving Retention of Shares of General Citicorp's application to acquire G.W.B. Holding Insurance Agencies Company was protested by various insurance industry trade associations on the ground that the insurance Citicorp, New York, New York, and its subsidiary activities of GWIA are prohibited under section 4(c)(8) G.W.B. Holding Company, Phoenix, Arizona, both of the BHC Act, as amended by Title VI of the bank holding companies within, the meaning of the Garn-St Germain Depository Institutions Act of Bank Holding Company Act (the "BHC Act"), have 1982.4 The Garn-St Germain Act amended section applied for the Board's approval under section 4(c)(8) of the BHC Act to provide that, with seven 4(c)(8)(D) of the BHC Act (12 U.S.C. § 1843(c)(8)(D)) exceptions, insurance activities are not closely related and section 225.25(b)(8)(iv) of Regulation Y (12 C.F.R. to banking and thus are not generally permissible for § 225.25(b)(8)(iv)) to retain the shares of two of their bank holding companies. 12 U.S.C. § 1843(c)(8); see indirect nonbank subsidiaries, Great Western Insur- also 12 C.F.R. 225.25(b)(8). ance Agency, Phoenix, Arizona ("GWIA"), and In response to the protests, Citicorp committed that, United Security Corporation ("United"), Phoenix, following consummation of the transaction, GWIA Arizona, and to permit these subsidiaries to continue would cease selling insurance, other than credit-reto engage in certain general insurance agency activi- lated insurance permitted under section 4(c)(8)(A) of ties. the BHC Act, pending resolution by the Board of the On August 25, 1986, the Board approved an appli- legal questions raised by the insurance activities of cation under section 3 of the BHC Act by Citicorp to GWIA.5 Citicorp made a similar commitment regardacquire G.W.B. Holding Company and its subsid- ing the insurance activities of United at the time Bank iary, Great Western Bank and Trust, Phoenix, Ari- acquired United Bank of Arizona and United. In zona ("Bank").1 Bank has owned and conducted making these commitments, Citicorp expressly regeneral insurance agency activities through GWIA, served its position that the BHC Act does not prohibit pursuant to Arizona law, since prior to December 31, GWIA and United from conducting insurance agency 1971.2 G.W.B. Holding Company, which became activities,6 and also reserved the right to apply to the a bank holding company in 1981 through the acqui- Board under section 4(c)(8)(D) to retain the shares of sition of Bank, obtained indirect ownership and GWIA and United even if their insurance activities control of GWIA in conformance with and reliance were subject to section 4 of the BHC Act. on section 225.22(d)(2)(ii) of the Board's Regulation Citicorp filed the present applications claiming enti- Y.3 tlement for GWIA and United to resume conducting On June 13, 1988, Bank acquired all of the voting certain insurance agency activities, and for Citicorp to shares of United in connection with the merger of retain indirect control of GWIA and United, pursuant to one of the seven exemptions to the insurance prohibition of the Garn-St Germain Act, Exemp- 1. 72 Federal Reserve Bulletin 715 (1986). tion D. 12 U.S.C. § 1843(c)(8)(D). Exemption D pro- 2. Applicant states that the insurance activities of GWIA are vides an exception to the general insurance prohibition permissible under Arizona law, which provides that an Arizona bank of the Garn-St Germain Act for any insurance agency may "directly or through a bank subsidiary engage in any lawful activity which is reasonably related or incidental to banking. All activity that was conducted by a bank holding comactivities in which any bank was lawfully engaged directly or through a subsidiary on December 31, 1971, are declared to be incidental and related to banking for purposes of this paragraph." Arizona Revised Statutes § 6-184(3). 4. Pub. L. 97-320, Title VI, 96 Stat. 1469, 1536-1538 (1982). 3. Section 225.22(d)(2)(ii) permits a state bank owned by a bank 5. Citicorp also made certain commitments regarding the insurance holding company to acquire and retain, without obtaining specific underwriting activities of another subsidiary of Bank, Great Western Board approval, all of the voting shares of a company that engages Insurance Company, which is not the subject of this application. This solely in activities that the parent state bank may conduct directly, application also does not address Citicorp's request for relief to subject to the same limitations applicable to the bank. 12 C.F.R. conduct general insurance agency activities directly within Bank. 225.22(d)(2)(ii). The Board currently has this regulation under review. 6. As noted below, the Board is not required to address those 53 Federal Register 48,915 (December 5, 1988). questions in order to approve the present applications. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 71 pany or any of its subsidiaries on May 1, 1982, subject May 1, 1982 grandfather date in Exemption D. Thus, to certain geographic and functional limitations.7 in Protestants' view, GWIA and United do not qualify Notice of these applications, affording interested to continue to sell insurance under Exemption D. persons an opportunity to submit comments regarding these applications, has been published (53 Federal Compliance with Regulation Y Register 3789 (February 9, 1988); 53 Federal Register 51,911 (December 23, 1988)). The time for filing com- In Sovran Financial Corporation, Protestants raised ments has expired, and the Board has considered the similar claims concerning the compliance by the comapplications and all comments received, including the pany to be acquired with section 225.22(d)(2).10 Withcomments of several insurance trade associations out reaching the question raised by Protestants regard- ("Protestants"), in light of the factors set forth in ing section 225.22(d)(2), the Board determined in that section 4 of the BHC Act.8 case that a nonbank subsidiary of a holding company Protestants argue that the Board should not approve bank that conducted insurance agency activities on these applications because, in Protestants' view, any May 1, 1982, in conformance with section 225.22(d)(2) grandfather privileges that GWIA, United and G.W.B. would qualify for grandfather privileges under Exemp- Holding Company may qualify for under Exemption D tion D and could continue to conduct the specific terminated when these companies were acquired by insurance agency activities it conducted on May 1, Citicorp. Citicorp does not have grandfather rights 1982. The Board stated in that case that because under Exemption D in Arizona and is not otherwise section 225.22(d)(2) was in effect on May 1, 1982, authorized under the BHC Act to conduct the pro- conduct of insurance agency activities in compliance with that rule on the grandfather date would satisfy the posed non-credit related insurance agency activities in Arizona.9 Protestants also contend that GWIA and requirements of Exemption D, notwithstanding later challenges to the validity of the rule or the effect that United are not owned in conformance with the provia subsequent rulemaking proceeding might have on the sions of section 225.22(d)(2) because state banks in rule. Arizona are not authorized to sell insurance. They also contend that, in any event, section 225.22(d)(2) is The Board also determined in that case that a inconsistent with the express provisions of section 4 of nonbank subsidiary of a holding company bank that the BHC Act and that, as a result, GWIA and United had conducted insurance agency activities for many were not lawfully held by G.W.B. Holding Company years prior to May 1, 1982, in reliance on the regulaand UB Financial Corporation, respectively, on the tion, with the knowledge of the Board and state regulatory agencies and without a determination by these agencies that the activities were not in accord- 7. Exemption D restricts grandfathered insurance agency activities ance with applicable statutes and regulations, qualified to the state in which the grandfathered bank holding company has its principal place of business, any state immediately adjacent to that for grandfather privileges under Exemption D. This state, and any state or states in which insurance activities were was so even though the Board found that the company conducted by the bank holding company or any of its subsidiaries on did not comply with the requirements of section or before May 1, 1982. Exemption D also restricts these activities to insurance agency activities that were conducted by the grandfathered 225.22(d)(2) of Regulation Y because the company company on May 1, 1982, and sales of insurance coverages that conducted activities that could not be conducted by become available after that date so long as those coverages insure the company's parent state bank. against the same type of risks as coverages sold before that date, or are otherwise functionally equivalent to those coverages. 12 U.S.C. In this case, GWIA and United are each held by § 1843(c)(8)(D); 12 C.F.R. 225.25(b)(8)(iv). Bank in compliance with the provisions of section 8. The Board has received comments opposing Board approval of these applications from the Independent Insurance Agents of Amer- 225.22(d)(2) of the Board's Regulation Y and were ica, Inc., the National Association of Casualty and Surety Agents, wholly owned subsidiaries of a holding company bank National Association of Life Underwriters, National Association of on May 1, 1982.11 The Arizona Banking Commissioner Professional Insurance Agents, National Association of Surety Bond Producers, the New York State Association of Life Underwriters, Professional Insurance Agents of New York, Inc., and Independent Insurance Agents of New York, Inc. 9. Protestants also argue that these applications filed by Citicorp are 10. See Sovran Financial Corporation, 73 Federal Reserve Bulletin not complete and formal applications under section 4(c)(8) of the BHC 672 (1987), aff d sub nom., National Association of Casualty and Act, and that protestants have not received adequate notice of the Surety Agents v. Board of Governors, 856 F.2d 282 (D.C. Cir. 1988), Citicorp proposal. Both of these contentions are without merit. rehearing denied December 2, 1988, cert, denied, U.S. (May Citicorp filed its applications by letter, rather than on the usual Form 30, 1989). FRY-4, but submitted all of the financial, managerial, and descriptive 11. Protestants argue that GWIA was not lawfully conducting information required by the Board. Notice of these filings and of insurance activities on May 1, 1982, because the predecessor of Citicorp's amendment to include retention of United was published in G.W.B. Holding Company was subject to a Board order to divest the Federal Register, and protestants were given actual notice that GWIA by December, 1980, and did not obtain Board approval to these applications were filed. Protestants have also been provided all retain GWIA as a subsidiary of Bank after that date. The Board's of the public portions of the applications, and have submitted sub- order is clear, however, that G.W.B. Holding Company and its stantial written comments regarding these applications. predecessor were permitted to retain GWIA as a subsidiary of Bank Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

72 Federal Reserve Bulletin • February 1990 has determined that, insofar as Arizona law is con- with that rule, and on that date no question had been cerned, Bank may sell insurance directly or through a raised regarding the validity of the rule. The regulation subsidiary. The Arizona Commissioner has also deter- was adopted by the Board after notice and public mined that GWIA may conduct insurance agency comment and companies were justified in relying on activities under Arizona law, and GWIA has been that regulation at the time. Accordingly, because engaged in these activities since prior to December GWIA and United were validly held in reliance on this 1971, which is well before the relevant date in Exemp- rule on May 1, 1982, prior to enactment of the provition D. As noted above, the provisions of Arizona law sions in Title VI of the Garn-St Germain Act that have permit certain state banks to sell insurance directly as called into question the Board's discretion to promulwell as through subsidiaries.12 United has conducted gate this rule with respect to insurance powers, the its insurance agency activities since 1964 in reliance on Board believes that, if a determination is made that the the same provisions of Arizona law, with the know- rule is inconsistent with section 4, that determination ledge of the relevant state regulatory authorities and should not be applied retroactively to deprive GWIA without objection from those state authorities. Ac- or United of grandfather rights under Exemption D. cordingly, GWIA and United are held in conformance with the requirements of section 225.22(d)(2) of the Acquisition of Exempt Company Board's Regulation Y, and, under the terms of section 4(c)(8)(D) of the BHC Act and section 225.22(b)(8)(iv) The Board has also previously rejected Protestants' of the Board's regulations, GWIA and United qualify claim that a company that qualifies for Exemption D for the privileges of Exemption D. privileges loses those privileges upon its indirect ac- In addition, the Board believes that the same equi- quisition by another bank holding company. In table principles outlined in the Sovran case also re- Sovran, the Board determined that Exemption D perquire a determination that GWIA and United qualify mits a bank holding company that did not control a for the privileges in Exemption D in this case. In company conducting insurance activities on the grandparticular, the Board believes that, notwithstanding father date to acquire a bank holding company and its current challenges to the validity of the provisions of subsidiaries that qualify for grandfather privileges unsection 225.22(d)(2) of the Board's Regulation Y, it der Exemption D, provided that the grandfathered would be inequitable to deny GWIA and United grand- entity retains its separate corporate structure and its father privileges under Exemption D in view of the fact insurance activities are conducted only by the compathat GWIA and United have been operated openly as nies that were actually engaged in insurance activities subsidiaries of a holding company bank for many on the grandfather date and not by other companies years, and in full compliance with a previously unchal- within the acquiring banking organization. On Septemlenged Board regulation and with the full knowledge of ber 9, 1988, the U.S. Court of Appeals upheld this the Board and the Arizona Banking Commissioner.13 Board determination, and on May 30, 1989, the U.S. The Board has solicited public comment regarding Supreme Court refused to consider a further appeal of the validity of section 225.22(d)(2) in a proposed this case, thereby upholding the Board's decision.15 rulemaking regarding that regulation.14 The Board The Board notes that GWIA and United will be believes that Protestants' claim regarding that regula- retained as separate nonbank subsidiaries of Bank and tion must be considered in the context of that rulemak- will conduct the insurance agency activities that are ing. Moreover, the Board does not believe that its the subject of this application. In this regard, Applidetermination regarding the validity of section cant's other subsidiaries will not conduct insurance 225.22(d)(2) in that rulemaking should affect the Ex- agency activities on the basis of the grandfather privemption D rights of GWIA or United. Even if section ileges of GWIA or United. On this basis, and for the 225.22(d)(2) is modified or rescinded as a result of the reasons stated in its prior decisions and court proceedcurrent rulemaking, the fact remains that on May 1, ings, the Board concludes that G.W.B. Holding Com- 1982, GWIA and United were operated in compliance pany, GWIA and United may retain their Exemption provided the subsidiary met the requirements of section 225.22(d)(2) of Regulation Y (formerly section 225.4(e)). Patagonia Corporation, 59 Federal Reserve Bulletin 539, 541 (1973). As noted above, that rule expressly permits ownership of certain companies without Board approval, and the Board's divestiture order in 1973 did not impose any 15. National Association of Casualty and Surety Agents v. Board of independent approval requirement for retention of GWIA under that Governors, supra. Subsequent to its Sovran decision, the Board, in section. Id. reliance on that decision, approved acquisitions of 8 other bank 12. Arizona Revised Statutes § 6-184(3). holding companies that had or controlled companies that had Exemp- 13. See Sovran Financial Corporation, supra. tion D grandfather rights. Each of these approvals was also upheld on 14. 53 Federal Register 48,915 (December 5, 1988). judicial review. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 73 D grandfather privileges even though they have been May 1, 1982, material advertising the types of insuracquired by Citicorp.16 ance policies sold by the company, and summaries prepared by insurance underwriters of policies sold Scope of Grandfathered Activities and revenues received by the agency. Other evidence, including affidavits of the company's employees, may Protestants also contend that GWIA and United have also support a finding that a company qualifies for not provided an adequate basis for determining what Exemption D grandfather rights. particular lines of insurance these companies were In this case, the Board has considered the record selling as agent on May 1, 1982. Exemption D grand- regarding the types of insurance agency activities fathers insurance agency activities that were "engaged conducted by GWIA and United on May 1, 1982. The in by the bank holding company or any of its subsid- record indicates that, during 1982, GWIA had a valid iaries on May 1, 1982." The Board believes that the Arizona life insurance license authorizing GWIA to act requirement that the grandfathered company was "en- as agent for life and disability insurance, including the gaged in" insurance agency activities does not require sale of annuities, and a valid Arizona non-life and/or grandfathered companies to show that they actually disability license entitling GWIA to act as agent for a engaged in a sale of each particular type of insurance full line of individual and commercial casualty insurproduct on the specific grandfather date, Saturday, ance, including casualty, disability, property, surety, May 1, 1982. Instead, the Board believes that a com- vehicle and marine transportation insurance. The pany would meet the requirements of Exemption D for record also shows that, on and around May 1, 1982, particular types of insurance if the company provides GWIA in fact engaged in acting as agent for the sale of evidence that it was legally permitted to act as agent annuities and a variety of types of property and for those types of insurance on May 1, 1982, held itself casualty insurance for individuals and commercial out to the public as agent for the particular types of entities. In particular, GWIA has provided copies of insurance for which the company seeks grandfather agency agreements with several insurance underwritprivileges, and had not abandoned the business prior ers indicating that, on and around May 1, 1982, GWIA to the grandfather date.17 These showings may be was authorized to act as agent for these underwriters made with a variety of types of evidence, including in the sale of personal lines of insurance, including copies of insurance agency licenses in effect on and automobile, homeowners, dwelling, mobile home, peraround May 1, 1982, copies of policies for which the sonal indemnity, and inland marine insurance; in the company acted as agent during the 12 months prior to sale of commercial lines of insurance, including business, boiler and machinery, commercial automobile, commercial indemnity, farm, fidelity and surety, and 16. Protestants also contend that the conduct of insurance agency workers compensation insurance; and in the sale of activities by GWIA and United would represent an evasion of the insurance prohibitions of section 4(c)(8) of the BHC Act. See Citicorp credit-related life and disability insurance. GWIA has (American State Bank), 71 Federal Reserve Bulletin 789 (1985). The also provided copies of insurance policies in effect on Board believes that Protestant's reliance on the Board's decision in Citicorp (American State Bank) is misplaced. Citicorp acquired and and around May 1, 1982, which GWIA sold as agent. has operated Bank as a bank not as an insurance company, and there These policies illustrate that GWIA acted as agent in is no evidence that Bank will be operated primarily as an insurance the sale of non-credit related homeowners, automocompany. In addition, the insurance activities of GWIA and United are small in relation to the size of the banking operations of Bank and bile, and property (both flood and dwelling) insurance; there is no restriction imposed under state law on the banking credit related life and disability insurance; and annuactivities of Bank. Finally, Congress has authorized bank holding ities. Finally, GWIA has provided agency production companies and their subsidiaries that meet the requirements of Exemption D to continue to conduct insurance agency activities. As records prepared by an insurance underwriter for discussed above, the Board has determined that certain of the which GWIA acted as agent illustrating that GWIA insurance agency activities of GWIA and United are permissible under Exemption D, within the geographic and functional limitations received commissions in 1981 and 1982 for the sale established under Exemption D. Accordingly, in the Board's view, the during those years of automobile, personal inland facts of this case do not indicate, as they did in Citicorp (American marine, general commercial liability and automobile, State Bank), that the acquisition of Bank is primarily a device to permit Citicorp to engage in prohibited insurance activities. More- and comprehensive commercial policy insurance. over, because the insurance agency activities considered in this With respect to United, the record indicates that, on application are permissible under an express provision of the BHC Act, the Board does not believe that Citicorp's proposal to continue to May 1, 1982, United held a valid Arizona life insurance conduct insurance agency activities through GWIA and United pur- license authorizing United to act as agent for a full line suant to Exemption D would represent an evasion of the BHC Act. of life and disability insurance. United has also pro- 17. In an analogous context, the Board has stated that to be vided copies of agency agreements in effect during "engaged in" an activity on a specific grandfather date, a company must demonstrate that it had a program in place to provide a particular 1981 and 1982 with several insurance underwriters product or service to a customer and that it was in fact offering the authorizing United to act as agent for these underwritproduct or service to customers as of the grandfather date. 12 C.F.R. 222.145(c)(6). ers in the sale of various life insurance products, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

74 Federal Reserve Bulletin • February 1990 including whole life, term-life and limited life insur- limited to within the state. While this legislation was ance. In addition, United has provided copies of passed by the U.S. Senate and favorably reported by several non-credit related life insurance policies and committees of the U.S. House of Representatives,20 medical insurance policies that were sold by United as no legislation was enacted into law. The Board calls to agent and that were in force on May 1, 1982, or were Applicant's attention, however, that subsequent Conoffered by United within the 12 preceding months. gressional action may require modification of the Based on these and the other facts of record in this Board's order approving this application. The Board case, the Board believes that GWIA has demonstrated retains jurisdiction over the application to act to carry that, on May 1, 1982, GWIA was engaged in acting as out the requirements of any legislation adopted by agent in the sale of non-credit related homeowners, Congress that would affect the conduct of insurance automobile, property (flood and dwelling), personal activities by GWIA or United under the BHC Act. inland marine, general commercial liability and auto- Under section 4(c)(8) of the Act, the Board must mobile, and comprehensive commercial policy insur- also determine that the conduct of these activities by ance, as well as annuities and credit-related life and GWIA and United is a proper incident to banking for disability insurance. Based on the record, the Board purposes of that section. In making this determination, also believes that United has demonstrated that, on the Board must consider whether the performance of May 1, 1982, United was engaged in acting as agent in the activity can reasonably be expected to produce the sale of non-credit related life insurance and medi- benefits to the public that outweigh possible adverse cal insurance.18 Under the terms of Exemption D, effects. GWIA and United may each continue to conduct these The Board believes that approval of these applicainsurance agency activities that the company con- tions would permit GWIA and United to be viable ducted on May 1, 1982.19 Under Exemption D, the competitors and permit consumers in areas served by insurance agency activities of GWIA and United may GWIA and United to benefit from resumed access to be conducted only in Arizona, states adjacent thereto, these companies as a source of insurance products and or states in which the company lawfully engaged services. This proposal would also serve to increase in insurance activities on May 1, 1982. 12 U.S.C. competition in the provision of insurance agency ser- § 1843(c)(8)(D). vices in the areas served by these companies, and The Board notes that the 100th Congress had under avoid disrupting established relationships between active consideration legislation that would have ap- these companies and their customers by permitting plied the insurance prohibitions of the Garn-St Ger- GWIA and United to resume selling new policies to main Act to the activities of holding company banks these customers. In addition, the Board finds that the except where the bank was located in the same state as record does not indicate that approval of these applithe bank holding company, the insurance activities cations would result in undue concentration of rewere permissible under state law, and sales were sources, unfair or decreased competition, conflicts of interest, unsound banking practices or other adverse effects.21 Accordingly, the Board believes that the 18. The Board has also considered Citicorp's argument that GWIA balance of public interest factors in this case weighs in and United were engaged in "a general insurance agency business" favor of approval of these applications.22 and should be permitted to continue to act as agent for all types of insurance as a general insurance agency. The Board believes that this broad categorization is not supportable under the terms of Exemption D, which permits a grandfathered company to conduct "any insurance 20. See S. Rep. No. 305, 100th Cong., 2d Sess., 109-110 (1988); agency activity which was engaged in by the bank holding com- H.R. Rep. No. 822 (Part 1), 100th Cong., 2d Sess. 168 (1988); H.R. pany ... on May 1, 1982, . . . including . . . sales of insurance Rep. No. 822 (Part 2), 100th Cong., 2d Sess. 126-27 (1988). coverages which may become available after May 1, 1982, so long as 21. Protestants raise a concern that the conduct of insurance agency those coverages ensure against the same types of risk as, or are activities by GWIA and United will involve "subtle coercion" of otherwise functionally equivalent to, coverages sold on May 1, customers of Bank to obtain insurance products from these compa- 1982 . . ." 12 U.S.C. § 1843(c)(8)(D). In the Board's view, this specific nies. Protestants have presented no evidence that any illegal tying or reference to new types of coverages, with its reference to same types coercion has in fact occurred or is likely to occur in the provision of of risk, would not be necessary if Exemption D were intended broadly insurance products in this case, and the historical penetration rate to authorize "general insurance agency business." Rather, the limi- data provided by Citicorp does not indicate that these practices have tations in Exemption D indicate that it was intended to permit occurred. Moreover, Citicorp, and its subsidiaries, including GWIA, grandfathered companies to act as agent only for the specific types of United and Bank, are prohibited by statute from tying the provision of insurance these companies provided on May 1,1982, and certain types credit to the insurance or other services provided by these companies, of related coverages developed after that date. and have established corporate policies designed to prevent this 19. The record also suggests that, at various times, GWIA and practice. 12 U.S.C. § 1972. United may have acted as agent for a variety of other types of 22. Protestants have asserted that a public hearing is necessary in insurance. The Board's determination at this time does not prevent this case. Under section 4, a protestant is not entitled to a hearing on GWIA or United from providing additional evidence that it acted as every application, but only when there are issues of material fact in agent for any or all of these other types of insurance on May 1, 1982. dispute. See Connecticut Bankers Association v. Board of Governors, Upon such a showing, GWIA or United would be permitted under 627 F.2d 245, 251 (D.C. Cir. 1980). After review of the record in this Exemption D to continue to act as agent for these types of insurance. case, the Board believes that there are no material issues of fact in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 75 Based on the foregoing and all the facts of record, 60 percent of the voting shares of The CIT Group the Board has determined that these applications Holdings, Inc., New York, New York ("CIT"). All should be, and hereby are, approved. This determina- of the shares of CIT are currently owned by Manution is subject to the conditions that the insurance facturers Hanover Corporation, New York, New activities be conducted solely by GWIA and United, York ("MHC"). Dai-Ichi seeks to engage through which must remain independent subsidiaries of CIT in commercial finance, leasing, factoring, sales Applicant,23 that each company limit its insurance finance, credit servicing, community development, activities to the insurance agency activities that the the sale of credit-related life, accident and health and Board has found in this order were conducted by the disability insurance, and credit-related property and company on May 1, 1982, and that GWIA and United casualty insurance.1 conduct these activities only in Arizona, adjacent Notice of the application, affording interested perstates, and states in which the company lawfully sons an opportunity to submit comments, has been engaged in the activity on May 1, 1982, as well as to all published (54 Federal Register 47,570 (1989)). The of the conditions set forth in Regulation Y. It is also time for filing comments has expired, and the Board subject to the Board's authority to require such mod- has considered the application and all comments reifications or termination of activities of the bank hold- ceived in light of the factors set forth in section 4 of the ing company or any of its subsidiaries as the Board BHC Act. finds necessary to assure compliance with, and pre- Dai-Ichi, with approximately $389.8 billion in convent evasions of, the provisions and purposes of the solidated total assets as of March 31, 1989, is the BHC Act and the Board's regulations and orders largest banking organization in the world. Dai-Ichi issued thereunder. owns The Dai-Ichi Kangyo Bank of California, Los By order of the Board of Governors, effective Angeles, California, which held total assets of $487.4 December 15, 1989. million as of September 30, 1989. In addition, Dai-Ichi operates branches in New York, Los Angeles, and Voting for this action: Chairman Greenspan and Governors Chicago, and agencies in Atlanta and San Francisco. Johnson, Seger, and Kelley. Absent and not voting: Gover- CIT, with total assets of $10.1 billion as of Septemnors Angell and La Ware. ber 30, 1989, is one of the larger diversified finance companies in the United States, operating 30 subsid- JENNIFER J. JOHNSON iaries with offices in 25 states and two foreign coun- Associate Secretary of the Board tries. The Board has previously determined that the activities conducted by CIT are closely related to The Dai-Ichi Kangyo Bank, Limited banking and are permissible for bank holding Tokyo,Japan companies.2 In acting on an application under section 4(c)(8) of Order Approving Acquisition of Nonbank Company the BHC Act, the Board must consider whether an applicant's performance of the proposed activities The Dai-Ichi Kangyo Bank, Limited, Tokyo, Japan "can reasonably be expected to produce benefits to ("Dai-Ichi"), a bank holding company within the the public, such as greater convenience, increased meaning of the Bank Holding Company Act ("BHC competition, or gains in efficiency, that outweigh pos- Act"), has applied for the Board's approval under sible adverse effects, such as undue concentration of section 4(c)(8) of the BHC Act (12 U.S.C. resources, decreased or unfair competition, conflicts § 1843(c)(8)) and section 225.23(a) of the Board's of interest, or unsound banking practices." This con- Regulation Y (12 C.F.R. 225.23(a)) to acquire at least sideration also requires an evaluation of the financial and managerial aspects associated with the proposal. 12 C.F.R. 225.24. dispute, and the general allegations and issues raised by protestants In every case involving a nonbanking acquisition by relate principally to interpretations of statutory provisions and conclusions of law and fact that must be made by the Board. In light of a bank holding company under section 4 of the BHC this, and the fact that protestants have had an opportunity to comment Act, the Board considers the financial condition and and have submitted extensive written comments, the Board does not resources of the applicant and its subsidiaries and the believe that a public hearing regarding this matter would be useful or appropriate in this case. 23. This condition is not intended to preclude Citicorp from seeking Board approval to merge GWIA and United and continue to engage through the resulting company in insurance agency activities under 1. Dai-Ichi and MHC have also entered into a Stock Purchase Exemption D if the merger is for legitimate business purposes and Agreement pursuant to which Dai-Ichi will acquire 4.9 percent of the otherwise conforms with the limitations in this order and the require- voting shares of MHC. ments of the Board's regulations. See 12 C.F.R. 225.25(b)(8)(iv), 2. Manufacturers Hanover Corporation, 70 Federal Reserve Bullefootnote 10. tin 452 (1984); 12 C.F.R. 225.25(b)(1), (5), (6), and (8). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

76 Federal Reserve Bulletin • February 1990 effect of the transaction on these resources.3 In ac- Based on these and other facts of record, the Board cordance with the principles of national treatment and concludes that the financial considerations are consiscompetitive equity, the Board has stated that it ex- tent with approval of the application. The Board has pects a foreign bank to meet the same general stan- also concluded that managerial factors are consistent dards of financial strength as domestic bank holding with approval. companies and to be able to serve as a source of In considering this application, the Board must strength to its United States banking operations.4 In determine whether the proposed joint venture can considering applications of foreign banking organiza- reasonably be expected to produce benefits to the tions, the Board has noted that foreign banks operate public that outweigh the possible adverse effects. outside the United States in accordance with different 12 U.S.C. § 1843(c)(8). In the past, the Board has regulatory and supervisory requirements, accounting expressed concern that a joint venture could lead to a principles, asset quality standards, and banking prac- matrix of relationships between the co-venturers that tices and traditions, and that these differences have could lessen competition between the co-venturers, made it difficult to compare the capital positions of create the possibility of conflicts of interest, or impair domestic and foreign banks. The Board, however, or give the appearance of impairing the ability of the recently adopted a proposal to supplement its consid- banking organization to function effectively as an eration of capital adequacy with a risk-based system independent and impartial provider of credit.6 In this that is simultaneously being proposed by the member case, neither the proposed investment nor the Stock countries of the Basle Committee on Banking Regula- Purchase Agreement between Dai-Ichi and MHC tions and Supervisory Practices and the other domes- place any limits on the other activities of Dai-Ichi or tic federal banking agencies.5 The Japanese Ministry MHC. Both Dai-Ichi and MHC are large, independent of Finance in April of last year acted to implement for organizations, that will continue to compete in a Japanese banking organizations the risk-based capital variety of banking and nonbanking activities. In addiframework developed by the Basle Committee. The tion, because these companies are both bank holding Board considers the Basle Committee proposal an companies whose activities conform to the requireimportant step toward a more consistent and equitable ments of the BHC Act, this proposal does not raise the international standard for assessing capital adequacy. same level of concern present in joint ventures be- In this case, the primary capital ratio of Dai-Ichi, as tween bank holding companies and commercial compublicly reported, is below the minimum level speci- panies that the proposed joint venture may undermine fied in the Board's Capital Adequacy Guidelines. After the legally mandated separation of banking and making adjustments to reflect Japanese banking and commerce.7 Formation of this joint venture is not accounting practices, however, including consider- expected to create any conflicts of interest or adation of a portion of the unrealized appreciation in versely influence Dai-Ichi or MHC in any creditor Dai-Ichi's portfolio of equity securities consistent with relationships. Moreover, there is no evidence in the the principles in the Basle capital framework, Dai- record to indicate that approval of this proposal would Ichi's capital ratio meets United States standards. In result in undue concentration of resources, decreased addition, the Board notes that Dai-Ichi is in the pro- or unfair competition, unsound banking practices, or cess of raising additional equity capital. other adverse effects on the public interest. The Board also has considered additional factors Dai-Ichi has requested the Board's authorization to that mitigate its concern in this case. The Board notes retain the credit-related property and casualty insurthat Dai-Ichi is in compliance with the capital and ance activities of CIT, which CIT currently conducts other financial requirements of Japanese banking or- pursuant to exemption D of the Garn-St Germain ganizations. In addition, the Board notes that Dai-Ichi Depository Institutions Act of 1982 (the "Garn Act").8 currently exceeds the minimum requirements established by the Basle Committee capital framework for 6. See, e.g., Amsterdam-Rotterdam Bank, N.V., 70 Federal Re- 1992. serve Bulletin 835 (1984). 7. The Hongkong and Shanghai Banking Corporation, 74 Federal Reserve Bulletin 137 (1988). 8.12 U.S.C. § 1843(c)(8)(D). Exemption D of the Garn Act permits 3. 12 C.F.R. 225.25; The Fuji Bank Limited, 75 Federal Reserve a bank holding company to engage in "any insurance activity which Bulletin 94 (1989); Bayerische Vereinsbank AG, 73 Federal Reserve was engaged in by the bank holding company or any of its subsidiaries Bulletin 155, 156 (1987). on May 1, 1982." Such activities may be conducted in the grandfa- 4. See, e.g., Toyo Trust and Banking Co., Ltd., 74 Federal Reserve thered company's home state, states adjacent thereto, or any state Bulletin 623 (1988); The Mitsubishi Bank, Limited, 70 Federal Reserve where the company was authorized to operate an insurance business Bulletin 518 (1984). See also Policy Statement on Supervision and before the grandfather date. The Board has previously determined Regulation of Foreign-Based Holding Companies, Federal Reserve that an insurance agency which is entitled to continue to sell insurance Regulatory Service I 4-835 (1979). under exemption D does not lose its grandfathered rights if the agency 5. 54 Federal Register 4186 (1989). is acquired by another bank holding company, provided the agency Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 77 CIT will remain a separate subsidiary of Dai-Ichi and National City Corporation MHC, and the insurance activities of CIT will not be Cleveland, Ohio conducted by any of Dai-Ichi's other subsidiaries. The Order Approving Applications to Acquire a Savings Board has previously determined that CIT was entitled Association and to Engage in Other Permissible to the privileges of exemption D after its acquisition by MHC.9 For the reasons stated in that Order, and the Nonbanking Activities reasons stated in the Board's Sovran decision, the National City Corporation, Cleveland, Ohio ("Nation- Board has determined that CIT may continue to enal City"), a bank holding company within the meaning gage in insurance activities pursuant to exemption D of the Bank Holding Company Act (the "BHC Act"), following its acquisition by Dai-Ichi.10 has applied for the Board's approval under section Based on the foregoing and other facts of record, the 4(c)(8) of the BHC Act (12 U.S.C. § 1843(c)(8)) and Board has determined that the public benefits associsection 225.23 of the Board's Regulation Y (12 C.F.R. ated with this proposal can reasonably be expected to 225.23), to acquire GEM Savings Association, Dayoutweigh possible adverse effects, and that the balance ton, Ohio ("GEM"), a savings association, pursuant of the public interest factors that the Board is required to section 225.25(b)(9) of the Board's Regulation Y to consider under section 4(c)(8) of the BHC Act is (12 C.F.R. 225.25(b)(9)). National City also has apfavorable. Accordingly, the Board has determined that plied for Board approval to acquire indirectly: the application should be, and hereby is, approved, (a) GEM Mortgage Corporation of North America, subject to the conditions contained in this Order. This Dayton, Ohio, and thereby engage in mortgage determination is further subject to all of the conditions banking, pursuant to 12 C.F.R. 225.25(b)(1); set forth in the Board's Regulation Y, including those (b) GEM America Realty and Investment Corporain section 225.4(d) and 225.23(b), and to the Board's tion, Dayton, Ohio, and thereby engage in originatauthority to require modification or termination of the ing real estate loans, pursuant to 12 C.F.R. activities of the holding company or any of its subsid- 225.25(b)(1), and real estate appraisal services, puriaries as the Board finds necessary to assure complisuant to 12 C.F.R. 225.25(b)(13); ance with, or to prevent evasion of, the provisions and (c) GEM Financial Corporation, Dayton, Ohio, and purposes of the BHC Act and the Board's regulations thereby engage in discount brokerage services, purand orders issued thereunder. suant to 12 C.F.R. 225.25(b)(15); and This transaction shall not be consummated later (d) Cen-Pro, Inc., Dayton, Ohio, and thereby enthan three months after the effective date of this gage in arranging commercial real estate equity Order, unless such period is extended for good cause financing, pursuant to 12 C.F.R. 225.25(b)(14). by the Board or by the Federal Reserve Bank of San Francisco, pursuant to delegated authority. Notice of the applications, affording interested per- By order of the Board of Governors, effective sons an opportunity to submit comments, has been December 15, 1989. published (54 Federal Register 48,025 (1989). The time for filing comments has expired, and the Board has Voting for this action: Chairman Greenspan and Governors considered the applications and all comments received Johnson, Kelley, and La Ware. Voting against this action: in light of the public interest factors set forth in section Governor Seger. Absent and not voting: Governor Angell. 4(c)(8) of the BHC Act. Section 601 of the Financial Institutions Reform, JENNIFER J. JOHNSON Recovery, and Enforcement Act of 1989, Pub.L. 101- Associate Secretary of the Board 73, § 601, 101 Stat. 183, 408 (as codified at 12 U.S.C. § 1843(i)) ("FIRREA"), permits the Board to approve an application by a bank holding company to acquire a savings association under section 4(c)(8) of the BHC Act. Pursuant to this authority, the Board has determaintains its separate corporate structure and its insurance activities are not extended to other subsidiaries within the acquiror's banking mined that the operation of a savings association is organization. Sovran Financial Corporation, 73 Federal Reserve closely related to banking and permissible for bank Bulletin 672 (1987). This determination has been upheld by the courts. holding companies. 12 C.F.R. 225.25(b)(9).1 The National Ass'n of Casualty and Surety Agents v. Board of Governors, 856 F.2d 282, reh'g denied en banc, 862 F.2d 351 (D.C. Cir. 1988), cert, denied, _ U.S. _, 109 S. Ct. 2430 (1989). 9. Manufacturers Hanover Corporation, 70 Federal Reserve Bulle- 1. In making this determination, the Board required that savings tin 452 (1984). associations acquired by bank holding companies conform their direct 10. Pursuant to exemption D, CIT may sell insurance only in New and indirect activities to those activities permissible for bank holding York, the home state of MHC under the Douglas Amendment, states companies under section 4 of the BHC Act. National City proposes to adjacent to New York, and states where MHC conducted insurance conform all of the direct and indirect activities of GEM to the agency activities on May 1, 1982. requirements of section 4(c)(8) of the BHC Act upon consummation Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

78 Federal Reserve Bulletin • February 1990 Board also has determined that mortgage banking, real Upon consummation of the proposed acquisition, estate appraisal services, arranging commercial real National City would be the largest commercial banking estate equity financing, and discount brokerage are organization in Ohio, controlling $13.6 billion in deposclosely related to banking. 12 C.F.R. 225.25(b)(1), its in the State, representing an approximate (b)(13), (b)(14), and (b)(15). Applicant proposes to 10 percent share of deposits in depository institutions in conduct these activities within the limits and condi- Ohio. In the Board's view, consummation of this protions set forth in the Board's regulations. posal would not have a significantly adverse effect upon National City, which operates 18 banking subsidiar- the concentration of banking organizations in Ohio. ies, has total consolidated assets of $21.6 billion, and is National City and GEM operate depository institutions the largest commercial banking organization in Ohio, in the Dayton, Ohio banking market.3 In the Dayton with deposits of $12.4 billion. National City also market, National City is the third largest depository engages through several subsidiaries in permissible institution, with 11.8 percent of the deposits in the market. nonbanking activities. GEM is the fifth largest depository institution with 7.9 GEM, with total assets of $1.6 billion, is the seventh percent of the deposits in the market. Upon consummalargest savings association in Ohio.2 GEM currently op- tion of this proposal, National City would become the erates 24 branches in Ohio and controls several compa- largest commercial depository organization with 25.6 pernies engaged in activities permissible for a savings asso- cent of total deposits.4 Although consummation of this ciation. GEM is currently operating as a mutual savings proposal would eliminate some existing competition beassociation. Prior to the acquisition, GEM will convert tween National City and GEM in the Dayton, Ohio from mutual to stock form, with National City purchasing banking market, 36 other depository institutions would all of the outstanding stock of GEM. continue to compete in the market. This acquisition would In order to approve these applications, the Board result in an increase of the Herfindahl-Hirschman Index also is required to determine that the performance of ("HHI") of 324 points to a level of 1439.5 In view of the the proposed activities by National City "can reason- fact that the Dayton market would remain only moderately concentrated, the Board concludes that the acquisiably be expected to produce benefits to the public . . . tion would not have a substantially adverse effect on that outweigh possible adverse effects, such as undue existing competition in the Dayton market. concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking National City also has applied, pursuant to section practices." 12 U.S.C. § 1843(c)(8). 4(c)(8) of the BHC Act, to acquire certain nonbanking The financial and managerial resources and future pros- subsidiaries of GEM. National City and GEM operate pects of National City and its bank subsidiaries, and GEM subsidiaries that engage in permissible mortgage and nonare consistent with approval. In assessing the financial mortgage commercial banking, and discount brokerage factors, the Board believes that bank holding companies activities. The market share controlled by each of these must maintain adequate capital at savings associations subsidiaries is small, and there are numerous competitors they propose to acquire. In this case, National City's for their services. Accordingly, consummation of this acquisition of GEM will result in a capital infusion of proposal would have a de minimis effect on existing approximately $105 million into GEM. Upon consumma- competition in each of the markets, and the Board contion, National City will raise the Tier 1 capital of GEM, exclusive of all intangible assets, to at least three percent of the total assets of GEM. In addition, National City has 3. The Dayton banking market includes: all of Greene, Miami, and Montgomery Counties, and portions of Clark and Warren Counties, committed that GEM will meet all present and future all in Ohio. minimum capital ratios adopted for savings associations 4. The pre-consummation market share statistics are based on by the Office of Thrift Supervision or the Federal Deposit calculations in which the deposits of GEM and all other thrifts are included at 50 percent. Upon consummation of the proposal, GEM Insurance Corporation. would be affiliated with a commercial banking organization, thus, on a pro forma basis, the deposits of GEM are included at 100 percent, while the deposits of other savings associations continue to be included at 50 percent. 5. Under the revised Department of Justice Merger Guidelines, 49 except for four activities conducted in three operating subsidiaries. Federal Register 26,823 (1984), a market in which the post-merger The three operating subsidiaries are GEM Financial Corporation, HHI is above 1800 is considered highly concentrated. In such marwhich sells security alarm systems and services, R.E.C.O.R.P., which kets, the Department is likely to challenge a merger that increases the engages in activities similar to activities engaged in by a community HHI by more than 50 points. The Department has informed the Board development corporation, and GEM America Realty and Investment that a bank merger or acquisition generally will not be challenged (in Corporation, which engages in property management for third parties, the absence of other factors indicating anticompetitive effects) unless and in real estate development activities. National City has committed the post-merger HHI market is at least 1800 and the merger increases that the impermissible activities of these three subsidiaries will be the HHI by 200 points. The Justice Department has stated that the divested within two years of consummation. See, e.g., F.N.B. Cor- higher than normal HHI thresholds for screening bank mergers for poration, 71 Federal Reserve Bulletin 340 (1985). anticompetitive effects implicitly recognize the competitive effect of 2. All data are as of June 30, 1989. limited-purpose lenders and other non-depository financial entities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 79 eludes that the proposal would not have any significantly 225.23 of the Board's Regulation Y (12 C.F.R. 225.23), adverse effect on the competition in the provision of these for its subsidiary, Norwest Investment Services, Inc., services in any relevant market. Minneapolis, Minnesota ("Company"),1 to: There is no evidence in the record to indicate that (1) provide investment advisory and brokerage serapproval of this proposal would result in undue con- vices on a combined basis to institutional and retail centration of resources, decreased or unfair competi- customers ("full-service brokerage activities"); tion, conflicts of interests, unsound banking practices, (2) underwrite and deal in U.S. government and or other adverse effects on the public interest. Accord- other bank-eligible securities; ingly, the Board has determined that the balance of (3) underwrite and deal in, to a limited extent, public interest factors it must consider under section municipal revenue bonds, 1-4 family mortgage- 4(c)(8) of the BHC Act is favorable and consistent with related securities, commercial paper and consumerapproval of National City's applications to acquire receivable-related securities ("bank-ineligible secu- GEM and certain of its nonbanking subsidiaries. rities"); Based upon consideration of all the relevant facts, the (4) act as agent in the private placement of all types Board concludes that the balance of the public interest of securities, including providing related advisory factors that the Board is required to consider under services; section 4(c)(8) is favorable. Accordingly, based on all (5) purchase and sell all types of securities on the facts of record, and subject to the commitments made order of investors as a "riskless principal" ; by National City set forth in this Order, the Board has (6) purchase and sell silver and gold bullion and determined that the proposed applications should be, coins for the accounts of customers; and hereby are, approved. This determination is also (7) lease personal and real property and act as agent, subject to all of the conditions set forth in the Board's broker, or adviser in leasing such property; and Regulation Y, including sections 225.4(d) and 225.23, (8) engage in futures commission merchant activities and to the Board's authority to require such modificaand provide investment advice on futures contracts tions or termination of the activities of a bank holding and options. company or any of its subsidiaries as the Board finds necessary to assure compliance with, or to prevent Norwest, with consolidated assets of $23.1 billion, is evasion of, the provisions and purposes of the BHC the 30th largest banking organization in the nation. It Act and the Board's regulations and Orders issued operates 38 subsidiary banks and engages directly and thereunder. The transaction shall be made not later through subsidiaries in a variety of permissible nonthan three months after the effective date of this banking activities.2 Order, unless such Order is extended for good cause Notice of the application, affording interested perby the Board or by the Federal Reserve Bank of sons an opportunity to submit comments on the pro- Cleveland, pursuant to delegated authority. posal, has been published (54 Federal Register 33,967 By order of the Board of Governors, effective (1989)). The time for filing comments has expired, and December 19, 1989. the Board has considered the application and all comments received in light of the public interest factors set Voting for this action: Chairman Greenspan and Governors forth in section 4(c)(8) of the BHC Act. The Board Johnson, Seger, Angell, Kelley, and LaWare. received written comments opposing Board approval of the application from the Securities Industry Associa- JENNIFER J. JOHNSON tion ("SIA"), a trade association of the investment Associate Secretary of the Board banking industry, and the Investment Company Institute ("ICI"), a trade association of the mutual fund Norwest Corporation industry. Minneapolis, Minnesota The Board has previously determined by regulation that leasing personal and real property and acting as Order Approving Application to Underwrite and agent, broker, or adviser in leasing such property; Deal in Certain Securities to a Limited Extent, and underwriting and dealing in bank-eligible securities; to Engage in Certain Related Securities Activities Norwest Corporation, Minneapolis, Minnesota ("Nor- 1. Company is currently an operating subsidiary of Norwest's lead bank, Norwest Bank Minnesota, N.A., Minneapolis, Minnesota west"), a bank holding company within the meaning of ("Bank"). Norwest proposes to combine the operations of Company the Bank Holding Company Act ("BHC Act"), has with another operating subsidiary of Bank, Norwest Brokerage Services, Inc., Minneapolis, Minnesota. Company, as the surviving applied for the Board's approval under section 4(c)(8) entity, would then become a direct subsidiary of Norwest. of the BHC Act (12 U.S.C. § 1843(c)(8)) and section 2. Data are as of June 30, 1989. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

80 Federal Reserve Bulletin • February 1990 acting as a futures commission merchant; and providing of its direct or indirect nonbank subsidiaries, is advisinvestment advice on financial futures and options on ing the investment companies in question, the pracfutures are permissible nonbanking activities for bank tices at which the prohibition against sale or distribuholding companies under section 4(c)(8) of the BHC tion of shares of investment companies being advised Act and the Board's Regulation Y. 12 C.F.R. are directed are not present here. The main purpose of 225.25(b)(5),(16),(18) and (19). Norwest has proposed the prohibition was to assure that the holding company to engage in these activities in accordance with all of the does not become involved in underwriting and dealing conditions set forth in Regulation Y. in the shares of investment companies it advises.4 In The Board has previously determined by order that this case, Norwest proposes to act only as agent for the purchase and sale of silver and gold bullion and customers desiring to purchase or sell investment coins for the accounts of customers is a permissible company securities, and therefore would not undernonbanking activity for bank holding companies under write or deal in those securities.5 section 4(c)(8) of the BHC Act. United Virginia Bank- Moreover, Norwest has committed that Company shares, Inc., 73 Federal Reserve Bulletin 309 (1987). will not provide investment advice to brokerage cus- Norwest has stated that Company will engage in this tomers regarding shares of investment companies that activity in accordance with all of the conditions set are advised by Norwest or any of its affiliates, includforth in the Board's previous Order. ing Bank. Norwest has also committed that Company The Board has also previously determined by order will disclose to its brokerage customers who purchase that full-service brokerage is a permissible nonbanking such shares that these investment companies are sponactivity for bank holding companies under section sored by third parties independent of Bank and its 4(c)(8) of the BHC Act. PNC Financial Corp., 75 affiliates. The disclosure statement will also state that Federal Reserve Bulletin 396 (1989); Bank of New such shares or interests are not endorsed or guaran- England Corporation, 74 Federal Reserve Bulletin 700 teed by, and do not constitute obligations of Bank or (1988). Norwest has stated that Company will engage its affiliates. Finally, this statement will state that the in this activity in accordance with all of the conditions investment company shares are not insured by the set forth in these Orders. Federal Deposit Insurance Corporation.6 Accordingly, The ICI has objected that, to the extent that Com- the Board does not believe that the potential conflicts pany proposes to broker securities issued by invest- of interest which the Glass-Steagall Act and the ment companies advised by Norwest or to advise Board's interpretive rule were intended to prevent brokerage customers regarding such securities, the would be present should Company broker shares of proposed activities are inconsistent with the Glass- investment companies that are advised directly by Steagall Act and with the Board's interpretive rule Bank. governing investment advisory services by bank hold- The Board notes that it issued its regulation and ing companies. Company proposes to act as broker for interpretive rule in 1972, and that subsequent developshares of investment companies that are advised by ments, such as court decisions in Schwab and in other Norwest's lead bank, Norwest Bank Minnesota, N.A. cases, suggest the need for reexamination of some of ("Bank"). The Board's interpretive rule prevents a the views expressed at that time. As a result, the Board bank holding company from engaging directly or indi- is considering seeking public comment regarding a rectly in the sale or distribution of securities of any proposed revision of the interpretive rule. investment company for which it acts as investment adviser. 12 C.F.R. 225.125(h). While the Board's interpretive rule does not apply in 46, 59 n.25 (1981). Indeed, the Office of the Comptroller of the this situation because Bank,3 and not Norwest or one Currency has issued an interpretive letter authorizing national banks and their subsidiaries to broker and recommend securities of investment companies for which such national banks or their subsidiaries serve as investment adviser. See OCC Interpretive Letter No. 403 3. By its terms, the Board's interpretive rule does not apply where (December 9, 1987), reprinted in Fed. Banking L. Rep. (CCH) para. an investment company is advised by a subsidiary bank, rather than 85,627, at 77,962. by a parent bank holding company or a nonbank subsidiary. The 4. Id. at 62, 66. interpretive rule was issued in connection with the Board's adoption 5. It is settled that buying and selling securities as a broker on the of a regulation pursuant to its authority under section 4(c)(8) of the order and for the account of customers does not constitute underwrit- BHC Act to approve nonbanking activities for bank holding com- ing or dealing in securities for purposes of section 20 of the Glasspanies and their nonbanking subsidiaries. Section 4(c)(8) does not Steagall Act (12 U.S.C. § 377), which regulates the activities of empower the Board to authorize activities for banks. The Supreme affiliates of member banks. Securities Industry Association v. Board Court has recognized that the authority of national banks and state of Governors, 468 U.S. 207, 216-21 (1984) ("Schwab"). banks to engage in investment advisory activities does not derive 6. The Board notes that Bank is required by the Office of the from the Board's regulation, and that the Board's interpretive rule Comptroller of the Currency to disclose such information to brokerage applies only to the investment advisory activities of bank holding customers of its operating subsidiary. See OCC Interpretive Letter companies and their nonbank subsidiaries. Board of Governors of No. 415 (February 12, 1988), reprinted in [Current] Fed. Banking L. Federal Reserve System v. Investment Company Institute, 450 U.S. Rep. (CCH) para. 85,639, at 78,000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 81 With regard to the proposed ineligible securities mitted that Company will conduct its private placeunderwriting and dealing activity, the conduct of such ment and riskless principal activities using the same activity has been determined by the Board to be methods and procedures, and subject to the same consistent with section 20 of the Glass-Steagall Act prudential limitations established by the Board in the provided the underwriting subsidiary derives no more Bankers Trust Order.11 than 10 percent of its total gross revenue from under- Consummation of the proposal would provide added writing and dealing in the approved securities over any convenience to Norwest's customers. In addition, the two-year period.7 The Board also found that, subject Board expects that the de novo entry of Norwest into to the prudential framework of limitations established the market for some of these services would increase in those cases to address the potential for conflicts of the level of competition among providers of these interests, unsound banking practices or other adverse services. Under the framework established in this and effects, the proposed underwriting and dealing activi- prior decisions, consummation of this proposal is not ties are so closely related to banking as to be a proper likely to result in any significant undue concentration incident thereto within the meaning of section 4(c)(8) of resources, decreased or unfair competition, conof the BHC Act.8 Norwest has committed that Com- flicts of interests, unsound banking practices, or other pany will conduct its underwriting and dealing activi- adverse effects. Accordingly, the Board has deterties with respect to bank-ineligible securities subject to mined that the performance of the proposed activities the 10 percent revenue test and the prudential limita- by Norwest can reasonably be expected to produce tions established by the Board in its Citicorp!Morgan/ public benefits which would outweigh adverse effects Bankers Trust, Chemical, and Modification Orders. under the proper incident to banking standard of section 4(c)(8) of the BHC Act.12 Finally, the Board has previously determined that acting as agent in the private placement of securities Based on the above, the Board has determined to and purchasing and selling securities on the order of approve Norwest's application subject to all of the investors as a "riskless principal" do not constitute terms and conditions set forth in the above-noted underwriting and dealing in securities for purposes of provisions of Regulation Y that relate to these activisection 20 of the Glass-Steagall Act, and that revenue ties, and subject as well to all of the terms and derived from these activities is not subject to the 10 conditions set forth in this Order and in the abovepercent revenue limitation on ineligible securities un- noted Board Orders that relate to these activities.13 derwriting and dealing.9 Additionally the Board found The Board's determination is subject to all of the that subject to the prudential limitations established in conditions set forth in the Board's Regulation Y, that case to address the potential for conflicts of interests, unsound banking practices or other adverse effects, the proposed private placement and riskless Securities Industry Association v. Board of Governors, 807 F.2d 1052 (D.C. Cir. 1986), cert, denied, 483 U.S. 1005 (1987) ("Bankers Trust principal activities are so closely related to banking as II"). The Board has fully considered and rejected this argument in to be a proper incident thereto within the meaning of Bankers Trust, where the Board found that the fact that a bank holding section 4(c)(8) of the BHC Act.10 Norwest has com- company wishes to privately place all types of securities in a manner similar to that used in placing high grade commercial paper, would not, by itself, change the activity into underwriting and dealing activities that would be prohibited under the Glass-Steagall Act. 11. The ICI has also objected to the proposal to the extent that it 7. Citicorp, J.P. Morgan & Co. Incorporated and Bankers Trust would allow Norwest to underwrite, deal in, or privately place New York Corporation, 73 Federal Reserve Bulletin 473 (1987) ("Cit- ineligible securities issued by its affiliates or representing interests in, icorp/Morgan/Bankers Trust"), ajf d sub nom., Securities Industry or secured by, obligations originated or sponsored by an affiliate of Association v. Board of Governors of the Federal Reserve System, 839 Company. For the reasons set forth in the Modification Order, and in F.2d 47 (2d Cir. 1988), cert, denied, 108 S.Ct 2830 (1988) ("SIA v. Bankers Trust, and subject to the limitations set forth in those orders, Board"); and Chemical New York Corporation, The Chase Manhat- the Board believes that Company may, consistent with the Glasstan Corporation, Bankers Trust New York Corporation, Citicorp, Steagall Act, underwrite, deal in, or privately place such securities. Manufacturers Hanover Corporation and Security Pacific Corpora- Norwest has committed that Company will comply with the limitation, 73 Federal Reserve Bulletin 731 (1987) ("Chemical"); as modi- tions set forth in the above-mentioned orders with respect to this fied by Order Approving Modifications to Section 20 Orders, 75 activity. Federal Reserve Bulletin 751 (1989) ("Modification Order"). 12. Company may also provide services that are necessary incidents 8. The ICI has objected to Norwest's proposal to the extent that it to these approved activities. Any activity conducted as a necessary could be construed to seek approval for Company to underwrite, deal incident to the ineligible securities underwriting and dealing activity in, or privately place as agent securities of investment companies that must be treated as part of the ineligible securities activity unless are advised by Company or Norwest. As noted above, Norwest has Company has received specific approval under section 4(c)(8) of the not requested approval to underwrite, deal in, or privately place as BHC Act to conduct the activity independently. Until such approval agent such securities. is obtained, any revenues from the incidental activity must be counted 9. Bankers Trust New York Corporation, 75 Federal Reserve as ineligible revenue subject to the 10 percent gross revenue limit set Bulletin 829 (1989) ("Bankers Trust"). forth in the Modification Order. 10. The SIA argues that the fact that Norwest is proposing that 13. In light of the decision in SIA v. Board, Norwest will not be Company privately place all types of securities, as opposed to only subject to the market share limitation with respect to its ineligible high grade commercial paper notes, is significant in assessing the activities that was originally imposed in the CiticorplMorganlBankers applicability of the Glass-Steagall Act prohibitions in this case. Trust and Chemical Orders. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

82 Federal Reserve Bulletin • February 1990 including those in sections 225.4(d) and 225.23(b), and Premier Bancorp proposes to acquire approximately to the Board's authority to require modification or 4.9 percent of the voting shares and 46 percent of the termination of the activities of a bank holding com- total equity of Florida Street Bank.2 Florida Street pany or any of its subsidiaries as the Board finds Bank, upon receiving a national bank charter,3 will be necessary to assure compliance with, and to prevent a limited-purpose de novo bank in voluntary liquidaevasion of, the provisions of the BHC Act and the tion engaged solely in liquidating assets acquired from Board's regulations and Orders issued thereunder. Premier Bancorp and certain of its banking subsidiar- This transaction shall not be consummated later ies. than three months after the effective date of this The proposed activities of Florida Street Bank are Order, unless such period is extended for good cause encompassed within the authorization in the Board's by the Board or by the Federal Reserve Bank of Regulation Y for bank holding companies to make, Minneapolis, pursuant to delegated authority. acquire, or service loans or other extensions of credit, By order of the Board of Governors, effective 12 C.F.R. 225.25(b)(1), and to operate a collection December 20, 1989. agency, 12 C.F.R. 225.25(b)(23).4 Accordingly, Premier Bancorp's proposed activities are closely related Voting for this action: Chairman Greenspan and Governors to banking and are permissible for bank holding com- Johnson, Seger, Kelley, and LaWare. Absent and not voting: panies. Governor Angell. In order to approve this application, the Board also must find that the performance of the proposed activ- JENNIFER J. JOHNSON ities can reasonably be expected to produce benefits to Associate Secretary of the Board the public, such as greater convenience, increased competition, or gains in efficiency, that outweigh pos- Premier Bancorp, Inc. sible adverse effects, such as undue concentration of Baton Rouge, Louisiana resources, decreased or unfair competition, conflicts of interest, or unsound banking practices. Order Approving an Application to Engage in Loan In evaluating the balance of public benefits associ- Recovery and Collection Agency Activities ated with this proposal, the Board has considered Premier Bank's proposal to provide partial financing to Premier Bancorp, Inc., Baton Rouge, Louisiana Florida Street Bank through acceptance of a subordi- ("Premier Bancorp"), a bank holding company within nated note as part of the consideration for Premier the meaning of the Bank Holding Company Act (the Bank's transfer of assets to the liquidating bank. "BHC Act"), has applied pursuant to section 4(c)(8) Premier Bank's acceptance of the note would repreof the BHC Act (12 U.S.C. § 1843(c)(8)) and section sent retention of potential risk of loss on the collection 225.23(a) of the Board's Regulation Y (12 C.F.R. of the assets to be sold. 225.23(a)), to establish Florida Street National Bank As a general matter, the Board believes it is inap- (In Liquidation), Baton Rouge, Louisiana ("Florida propriate for banks to finance the divestiture of their Street Bank"), and thereby engage de novo in loan own low-quality assets, as proposed here. In this case, recovery and collection activities. Premier Bank proposes to provide financing to Florida Notice of the application, affording interested per- Street Bank in excess of the amounts permitted in sons an opportunity to submit comments, has been section 23A of the Federal Reserve Act (12 U.S.C. duly published (54 Federal Register 34,248 (1989)). § 371c) and would fail to meet the collateral require- The time for filing comments has expired, and the ments under that statute. The loan Premier Bank Board has considered the application and all comproposes to extend would be subordinated to the bond ments received in light of the public interest factors set holders of Florida Street Bank and would be payable forth in section 4(c)(8) of the BHC Act. Premier Bancorp, with total consolidated assets of $4.2 billion, is the third largest commercial banking organization in Louisiana.1 Premier Bancorp operates 2. The acquisition of 46 percent of the total equity of Florida Street Bank necessitates an application under section 4(c)(8) of the BHC one bank subsidiary, Premier Bank, N.A., Baton Act. See Mellon Bank Corporation, 74 Federal Reserve Bulletin 773 Rouge, Louisiana ("Premier Bank"), with branches (1988). Cf. 12 C.F.R. 225.143(d)(5). 3. Florida Street Bank will not accept deposits, will not grant credit throughout Louisiana, and engages subsidiaries in a to the public in the ordinary course of business, and will not be insured variety of nonbanking activities. by the Federal Deposit Insurance Corporation. Accordingly, Florida Street Bank will not be a "bank" for the purposes of the BHC Act. 12 U.S.C. § 1841(c). See also Federal Reserve Regulatory Service H 4-363. 4. See also Mellon Bank Corporation, 74 Federal Reserve Bulletin 1. All banking data are as of September 30, 1989. 773 (1988). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 83 only from the proceeds of collections on the low- Voting for this action: Chairman Greenspan and Governors quality liquidated assets by Florida Street Bank. As a Johnson, Seger, Angell, Kelley, and La Ware. result, retention of this loan would, in the Board's view, represent retention of a low-quality asset with JENNIFER J. JOHNSON Associate Secretary of the Board the potential for further losses to Premier Bank. In light of this and the other facts of record, the Board Concurring Statement of Governor Seger has conditioned its approval of this application on the requirement that there be no direct or indirect funding I concur with the Board's action in this case. I agree by Premier Bank of Florida Street Bank through the with the Board's determination that, subject to the issuance of a subordinated note to Premier Bank or other extension of credit.5 condition that Premier Bank not finance the proposed asset sale to Florida Street Bank, the transaction may Subject to the foregoing condition and based on all be expected to have a favorable impact on the financial the facts of record, the Board has determined that condition of Premier Bancorp. However, I would there is no evidence in the record to indicate that permit Premier Bank to finance temporarily the pro- Premier Bancorp's proposed activity would lead to posed asset sale, and grant Premier Bancorp a reasonundue concentration of resources, decreased or unfair able time following the transfer of assets to Florida competition, unsound banking practices, or other ad- Street Bank within which to sell the note, rather than verse effects. The establishment of Florida Street require that the transaction be done without temporary Bank is part of Premier Bancorp's reorganization, financing by Premier Bank at any time. In my view, which will result in the divestiture and liquidation of some period of time to finance the asset sale and low-quality assets and the issuance of new equity dispose of the note would permit Applicant an opporcapital. tunity to obtain full value for the note and would be Based upon the foregoing and all the facts of record, more practical in light of simultaneous efforts by other the Board has determined that the balance of the banking organizations and the federal bank and thrift public interest factors that it is required to consider regulators to dispose of other problem assets at this under section 4(c)(8) is favorable. Accordingly, subtime. ject to the condition in this Order, the application is hereby approved. This determination is further subject to all of the conditions set forth in Regulation Y, December 22, 1989 including sections 225.4(d) and 225.23(b) of the Board's Regulation Y, 12 C.F.R. 225.4(d) and Orders Issued Under Sections 3 and 4 of the 225.23(b), and to the Board's authority to require such Bank Holding Company Act modification or termination of the activities of a bank holding company or any of its subsidiaries as the First Union Corporation Board finds necessary to assure compliance with, or Charlotte, North Carolina prevent evasions of, the provisions and purposes of the BHC Act and the Board's regulations and orders Order Approving the Acquisition of a Bank Holding issued thereunder. The Board's determination is also Company conditioned on the prior receipt by Applicant of approval from the Office of the Comptroller of the First Union Corporation, Charlotte, North Carolina, Currency to establish Florida Street Bank. and First Union Corporation of Florida, Jacksonville, This activity shall not be commenced later than Florida (together "First Union"), bank holding comthree months after the effective date of this Order, panies within the meaning of the Bank Holding Comunless such period is extended for good cause by the pany Act of 1956 ("BHC Act"), have applied for the Board or by the Federal Reserve Bank of Atlanta, Board's approval under section 3 of the BHC Act pursuant to delegated authority. (12 U.S.C. § 1842) to acquire all of the voting shares By order of the Board of Governors, effective of Florida National Banks of Florida, Inc., Jackson- December 22, 1989. ville, Florida ("Florida National"), and thereby to acquire Florida National Bank, Jacksonville, Florida, and Kingsley Bank, Orange Park, Florida.1 First 5. In connection with this proposal, Premier Bancorp requested an Union also has applied under section 4(c)(8) of the exemption from the requirements of section 23A of the Federal Reserve Act (12 U. S. C. § 371 c) for the subordinated note transaction between Premier Bank and Florida Street Bank. In light of the condition established by the Board pursuant section 4(c)(8) of the 1. First Union proposes to merge Florida National with First Union BHC Act precluding such a transaction, it is not necessary for the Corporation of Florida, and thereby indirectly acquire Florida Nation- Board to address the exemption request. al's subsidiary banks. 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84 Federal Reserve Bulletin • February 1990 BHC Act (12 U.S.C. § 1843(c)(8)) to acquire Florida commercial banking organization in Florida, control- Investment Management Company, Jacksonville, ling deposits of approximately $12.6 billion, represent- Florida, and thereby engage in investment advisory ing approximately 12.4 percent of the total deposits in activities, and Florida National Insurance Services, commercial banking organizations in Florida. Con- Inc., Jacksonville, Florida, and thereby engage in the summation of this proposal would not have a signifireinsurance of credit-related life, accident, health and cantly adverse effect upon the concentration of comdisability insurance. These activities are authorized mercial banking resources in Florida. for bank holding companies pursuant to the Board's First Union and Florida National compete directly Regulation Y, 12 C.F.R. 225.25(b)(4) and (8)(i). in 19 banking markets in Florida.6 In the Jacksonville Notice of the applications, affording an opportunity market, First Union is the third largest of nineteen for interested persons to submit comments, has been commercial banking organizations, controlling $1.4 given in accordance with sections 3 and 4 of the BHC billion in deposits, representing approximately 24.1 Act (54 Federal Register 27,062 (1989)). The time for percent of total deposits in commercial banking orgafiling comments has expired, and the Board has con- nizations in that market ("market deposits").7 Florida sidered the applications and all comments received in National is the largest commercial banking organizalight of the factors set forth in sections 3(c) and 4(c)(8) tion in the Jacksonville market, controlling $1.5 billion of the BHC Act. in deposits, representing approximately 25.7 percent of market deposits. Upon consummation of this pro- Douglas Amendment posal, First Union would become the largest commercial banking organization in the market, controlling Section 3(d) of the BHC Act, the Douglas Amend- $2.9 billion in deposits, representing approximately ment, prohibits the Board from approving an applica- 49.8 percent of market deposits.8 The Jacksonville tion by a bank holding company to acquire control of banking market is considered to be highly concenany bank located outside of the bank holding com- trated, with the four largest commercial banking orgapany's home state, unless such acquisition is "specif- nizations controlling 80.2 percent of the market deposically authorized by the statute laws of the State in its. The Herfindahl-Hirschman Index ("HHI") for the which [the] bank is located, by language to that effect market is 1955 and would increase by 1236 points to and not merely by implication."2 The Florida Regional 3191 upon consummation of the proposal.9 Reciprocal Banking Act of 1984 specifically authorizes While consummation of the proposal would result in the acquisition of Florida banks and bank holding a large increase in the HHI and the elimination of a companies by banking institutions located in North competitor in the Jacksonville banking market, the Carolina,3 and the Board has determined previously Board believes that a number of factors mitigate the that the acquisition of a Florida bank holding company competitive effects of this proposal. In particular, the by a North Carolina bank holding company is not Board has considered the presence of thrift institutions barred by the Douglas Amendment.4 in the Jacksonville banking market in its analysis of Competitive Considerations First Union controls five banking institutions in North 6. These markets are Jacksonville; North Brevard County; South Carolina, Florida, Georgia, South Carolina and Ten- Brevard County; Daytona Beach; Gainesville; Indian River County; North Lake County; Miami-Fort Lauderdale; New Smyrna Beach; nessee. First Union is the fifth largest commercial Orlando; East Palm Beach County; Pensacola; Pinellas County; West banking organization in Florida, controlling deposits Polk County; Port Charlotte; North Seminole County; St. Johns of $6.8 billion, representing approximately 6.6 percent County (St. Augustine area); Tampa; and West Volusia County. 7. The Jacksonville banking market is approximated by Baker, of the total deposits in commercial banks in the state.5 Clay, Duval and Nassau counties, as well as the Ponte Vedra Beach Florida National is the sixth largest commercial bank- portion of St. Johns County. ing organization in Florida, with deposits of $6.0 8. Market data are as of June 30, 1988. 9. Under the revised Department of Justice Merger Guidelines, billion, representing approximately 5.8 percent of the 49 Federal Register 26,823 (June 29, 1984), a market in which the total deposits in commercial banks in the state. Upon post-merger HHI is above 1800 is considered highly concentrated. In such markets, the Department is likely to challenge a merger that consummation of the proposal and all planned divesincreases the HHI by more than 50 points. The Department has titures, First Union would become the second largest informed the Board that a bank merger or acquisition generally will not be challenged (in the absence of other factors indicating anticompetitive effects) unless the post-merger HHI is at least 1800 and the merger increases the HHI by 200 points. The Justice Department has 2. 12 U.S.C. § 1842(d). stated that the higher than normal HHI thresholds for screening bank 3. Fla. Stat. Ann. § 658.295 (1984). mergers for anticompetitive effects implicitly recognize the competi- 4. First Union Corporation, 71 Federal Reserve Bulletin 971 (1985). tive effect of limited-purpose lenders and other non-depository finan- 5. State deposit data are as of June 30, 1989. cial entities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 85 this proposal.10 The record indicates that thrift institu- tained. The Board believes that this divestiture protions control approximately 26.9 percent of the com- posal substantially mitigates the effects on competition bined deposits of banks and thrift institutions in the of this proposal in the Jacksonville banking market.13 market and exert a considerable competitive influence In reaching its decision, the Board has given subon the market as providers of NOW accounts and stantial weight to the fact that eighteen commercial consumer loans. In addition, thrift institutions in the banking organizations and twelve thrift institutions market engage in the business of making commercial would continue to operate in the market after consumloans and are providing an alternative for such ser- mation of the proposal, and that these remaining vices in the Jacksonville market. Based upon the size, competitors include the largest banking organizations number, and market share of thrift institutions in the in Florida as well as a number of large regional bank Jacksonville banking market, the Board has concluded holding companies that have recently entered this that thrift institutions exert a competitive influence banking market. In addition, the Board notes that that mitigates in part the anticompetitive effects of this fifty-six credit unions operate in the market and conproposal.11 trol over twelve percent of the market's deposits. In order to further mitigate the anticompetitive There is also a large number of national consumer and effects that would otherwise result from consumma- commercial finance companies, as well as offices of tion of this proposal, First Union has committed to other nondepository providers of financial services in divest thirteen branches in the Jacksonville banking the Jacksonville market, that offer a broad range of market, controlling $210.5 million in deposits. The competitive services. Furthermore, the Jacksonville Board has reviewed the effect of the transaction in this market is a major urban area in a rapidly growing state market in light of the proposed divestiture. This dives- and is attractive for entry. Three de novo banks have titure represents approximately 4.0 percent of the opened in Jacksonville in the last five years, and a total deposits held by commercial banks in the market and of six out-of-market commercial banking organizations has the potential to create a significant competitor in have entered the Jacksonville market by acquisition the Jacksonville market. Where, as in this case, a since 1983. divestiture is proposed to avoid the otherwise substan- In light of the facts of record, including the divestitial anticompetitive effects resulting from a proposed ture plan, the role of thrift institutions in the market, acquisition, the Board has generally required that such the number of substantial competitors remaining in the divestiture take place on or before the date of consum- market, and other mitigating facts of record, the Board mation of the acquisition.12 The Board recognizes that has concluded that consummation of the proposal is special circumstances exist in this case that justify a not likely to have a significantly adverse effect on limited exception to this policy. In particular, consumcompetition in the Jacksonville banking market. mation of the proposal is expected to result in im- The Board has also examined the effects of this provement in Florida National's performance and proposal in the other 18 banking markets where First avoid certain managerial and other problems that Union and Florida National compete. In thirteen of could be associated with delay in consummation. First these markets, the increase in the HHI upon consum- Union has submitted a plan of divestiture and will mation of the proposal would not exceed the limits in immediately commence the bidding process for the the revised Department of Justice Merger Guidelines. sale of the branches to be divested. First Union In the other five banking markets, if 50 percent of the expects to complete the divestiture within six months deposits held by thrift institutions were included in the of consummation of the proposal and has committed to calculation of market concentration, the increase in complete the divestiture as soon as all regulatory the HHI upon consummation of the proposal would approvals permitting the divestiture have been obnot exceed the revised Department of Justice Merger Guidelines. Moreover, with 50 percent of deposits held by thrift institutions included in the calculation of 10. The Board previously has indicated that thrift institutions have market concentration, the resulting HHI is well below become, or have the potential to become, important competitors of commercial banks. See National City Corporation, 70 Federal Re- 1800 in 17 of the 18 markets.14 Accordingly, consumserve Bulletin 743 (1984); The Chase Manhattan Corporation, 70 mation of this proposal would not have a significantly Federal Reserve Bulletin 529 (1984); NCNB Bancorporation, 70 Federal Reserve Bulletin 225 (1984); General Bancshares Corporation, 69 Federal Reserve Bulletin 802 (1983); First Tennessee Corporation, 69 Federal Reserve Bulletin 298 (1983). 11. If 50 percent of the deposits held by thrift institutions were 13. If 50 percent of the deposits held by thrift institutions were included in the calculation of market concentration, First Union's pro included in the calculation of market concentration, First Union's pro forma market share would be 39.9 percent and the HHI would forma market share, after taking account of the planned divestitures, increase by 768 points to 2283. would be 36.4 percent and the HHI would increase by 564 points to 12. Barnett Banks of Florida, Inc., 68 Federal Reserve Bulletin 190 2079. (1982); Interfirst Corporation, 68 Federal Reserve Bulletin 243 (1982). 14. See Appendix. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

86 Federal Reserve Bulletin • February 1990 adverse effect on existing competition in any relevant Union's ability to restore promptly First Union's banking market. capital to pre-acquisition levels. The Board also has considered the effects of the The Board has also reviewed the effect of this proposal on probable future competition in the rele- proposal in light of Florida National's financial perforvant banking markets. In light of the market concen- mance. In recent years, the financial position of Flortration and the number of probable future entrants into ida National has deteriorated. The quality of Florida those markets, the Board concludes that consumma- National's assets, particularly with respect to its real tion of this proposal would not have a significantly estate portfolio, has resulted in a significant provision adverse effect on probable future competition in any for loan losses in early 1989 and has had a negative relevant market. impact on earnings. The extended period of time since the announcement of the merger and the accompany- Financial Factors and Managerial Resources ing uncertainty with regard to Florida National's management has resulted in a further decline in Florida In evaluating these applications, the Board has con- National's financial and managerial resources. The sidered the financial and managerial resources of First Board believes that First Union will provide the finan- Union and the effect on those resources of the pro- cial resources and stability to Florida National's manposed acquisition. The Board has stated and continues agement that is needed to strengthen Florida National to believe that capital adequacy is an important factor and improve its performance. Thus, considerations in the analysis of bank holding company expansion relating to banking factors lend substantial weight proposals.15 In this regard, the Board has stated that it toward approval of this application. expects banking organizations contemplating expansion proposals to maintain strong capital levels sub- Community Reinvestment Act stantially above the minimum levels specified in the Board's Capital Adequacy Guidelines16 without signif- In considering the convenience and needs of the icant reliance on intangibles, in particular goodwill. communities to be served by these institutions, the The Board carefully analyzes the effect of expansion Board has taken into account the record of First proposals on the preservation or achievement of Union's subsidiary banks under the Community Restrong capital levels and has adopted a policy that investment Act (12 U.S.C. § 2901 et seq.) ("CRA"). there should be no significant diminution of financial The CRA requires that federal financial supervisory strength below these levels for the purpose of effecting agencies encourage financial institutions to help meet major expansion proposals.17 the credit needs of the local communities in which In this case, First Union proposes to purchase all of they operate consistent with the safe and sound the outstanding common shares of Florida National operation of such institutions. To accomplish this with a combination of primary capital instruments and end, the CRA requires the appropriate federal supercash. A substantial amount of the cast portion of the visory authority to "assess the institution's record of purchase price will be funded through secondary cap- meeting the credit needs of its entire community, ital instruments. Although the proposal will result in a including low- and moderate-income neighborhoods, modest decline in the capital ratios of First Union consistent with the safe and sound operation of the following consummation of the proposal, First Union institution." 12 U.S.C. § 2903. The Board is rewill remain well capitalized with capital ratios signifi- quired to "take such record into account in its cantly above the minimum levels specified in the evaluation" of applications under section 3 of the Board's Capital Adequacy Guidelines. In addition, the BHC Act. >8 projections of First Union's operations reflect First 18. During the public comment period, the Board received com- 15. The Bank of New York Company, Inc., 74 Federal Reserve ments critical of the CRA performance of First Union's subsidiary Bulletin 257 (1988); Chemical New York Corporation, 73 Federal bank in Florida from Gulfcoast Legal Services, Bradenton, Florida, Reserve Bulletin 378 (1987); Citicorp, 72 Federal Reserve Bulletin 497 on behalf of a coalition of organizations and residents of low- and (1986); National City Corporation, 70 Federal Reserve Bulletin 743 moderate-income communities located in Orange, Duval, Dade, and (1984). Manatee Counties, Florida. In addition, the Board received a com- 16. Capital Adequacy Guidelines, 50 Federal Register 16,057 ment from the Charlotte Reinvestment Alliance critical of the CRA (April 24, 1985). performance of First Union's subsidiary bank in North Carolina. 17. Thus, for example, the Board has generally approved proposals Following discussions with First Union, these commenters have involving a decline in capital only where the applicants have promptly withdrawn their comments. restored their capital to preacquisition levels following consummation An individual ("Protestant") has also filed a comment critical of of the proposals and have implemented programs of capital improve- First Union's CRA record in Florida. Protestant alleges that First ment to raise capital significantly above minimum levels. See, e.g., Union has misrepresented its role in participating in lending in Citicorp, 72 Federal Reserve Bulletin 726 (1986); Security Pacific low-income and minority areas in Florida in the CRA statement of Corporation, 72 Federal Reserve Bulletin 800 (1986). First Union's Florida bank subsidiary, and that loans described in the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 87 The Board has carefully reviewed the CRA perfor- OCC was required by the CRA to consider the CRA mance record of First Union in light of the CRA, the performance of all of First Union's national bank Board's regulations, and the Statement of the Federal subsidiaries. The OCC concluded that the public ben- Financial Supervisory Agencies Regarding the Com- efits of First Union's proposal to provide financial and munity Reinvestment Act ("Agency CRA managerial resources to Florida National's bank sub- Statement").19 The Agency CRA Statement provides sidiaries and the commitments by First Union's naguidance regarding the types of policies and proce- tional bank subsidiaries to implement specific produres that the supervisory agencies believe financial grams to improve their CRA performance outweighed institutions should have in place in order to fulfill their the past less than satisfactory CRA performance of responsibilities under the CRA on an ongoing basis those banks. In connection with this action, the OCC and the procedures that the supervisory agencies will and First Union's national bank subsidiary in Florida use during the application process to review an insti- have entered into a written agreement that outlines the tution's CRA compliance and performance. steps the bank will take to improve its CRA perfor- On October 30, 1989, the Board deferred action on mance. The OCC has conditioned its approval of the First Union's applications in order to permit the First Union merger proposal on compliance with that Board to consider information regarding the CRA agreement. performance of First Union's national bank subsid- In reviewing the CRA factor in this case, the Board iaries that the Office of the Comptroller of the believes that the results of the OCC's examination Currency ("OCC") obtained as part of a pending findings regarding the past CRA performance of First CRA examination of these banks. The OCC recently Union's subsidiary banks, if considered alone, would completed its CRA examination of First Union's require a negative finding under the convenience and national bank subsidiaries and found a number of needs factor. However, the CRA performance of an deficiencies in the CRA performance of the subsid- institution, while a major component of the conveiaries in North Carolina, Florida, South Carolina and nience and needs standard under the BHC Act, is not Tennessee. The OCC's examination concluded that the only factor reviewed under that standard. The First Union's North Carolina, Florida, Tennessee, Board must also consider the other benefits of a and South Carolina banks did not have an established proposal in serving or maintaining the bank's service system to determine the credit needs of their comto the needs of the community. Moreover, the convemunities on a regular basis. The examination found nience and needs assessment must also be balanced that the banks did not regularly advertise the prodagainst the financial, managerial and other relevant ucts that were designed to assist low- and moderatestandards under section 3 of the BHC Act. income and minority areas. In addition, the banks did In this case, the Board has considered as the overnot have an adequate method for reviewing the riding factor in its evaluation of the convenience and geographic distribution of their loans and deposits. needs standard the deteriorating condition of Florida Based upon its examination of these banks, the OCC National and First Union's demonstrated ability to concluded that a number of First Union subsidiary provide the capital, financial and managerial support banks had an overall CRA rating that was less than necessary to enable Florida National's subsidiary satisfactory. banks to continue to serve their customers in numer- As the primary regulator of First Union's bank ous banking markets in Florida, including low- and subsidiary in Florida, the OCC has recently reviewed moderate-income neighborhoods. an application under the Bank Merger Act by First The Board has also taken into account the signifi- Union to merge this national bank in Florida with cant steps that First Union has taken in the past Florida National's bank subsidiaries. After concluding several months to address weaknesses in its CRA its CRA examination of this bank, the OCC approved performance. Although commitments made in the apthe proposed merger. In approving this merger, the plications process generally are not viewed as adequate to overcome a seriously deficient record, such as First Union's, the Board has stated in the Agency CRA statement of First Union's Florida bank subsidiary were not for CRA Statement that commitments may be appropriate the benefit of low-income and minority residents and businesses. The in addressing CRA performance in certain circum- Board has considered this comment and believes that this comment is not supported by the record and, in view of all of the facts in this case, stances, including in the context of an acquisition of a does not warrant denial of the applications. troubled financial institution in order to ensure its 19. 54 Federal Register 13,742 (March 21, 1989). The comments continued service to its community. made by Protestant were directed solely to First Union's CRA record. No adverse comments have been received concerning Florida Nation- The Board believes that First Union's plans, when al's CRA record, and the Board notes that the primary supervisory fully implemented, would address the deficiencies in agency for Florida National's subsidiary banks has determined that the CRA performance record of these banks is satisfactory. First Union's CRA performance, and that First Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

88 Federal Reserve Bulletin • February 1990 Union's recent actions have demonstrated progress is marginally consistent with approval of this proposal. toward correction of those deficiencies. In particular, In taking this action, the Board has relied on all of the First Union's banks have recently implemented a representations made by First Union regarding the detailed and comprehensive corporate plan for imple- programs and policies it has recently implemented and menting the type of CRA program outlined in the proposes to implement. The Board conditions its ac- Agency CRA Statement. This revised program in- tion in this case on implementation by First Union of cludes designating CRA officers and conducting an- all of these programs and policies as described in the nual reviews of the CRA program by senior manage- submissions made by First Union to the Board. The ment of First Union, including creation of an office for Board will carefully examine future applications by a corporate Director of Community Investment. To First Union to determine its progress in fulfilling its insure an effective outreach program, First Union has CRA obligations and commitments, and believes that committed to establish specific goals for its commer- First Union should not consider further bank expancial and consumer call officers with regard to business sionary proposals until it has demonstrated actual and development calls on minority businesses, minority sustained progress in improving its CRA performance. real estate agents and various public interest groups in In connection with its approval of this case, the Board low- and moderate-income neighborhoods. First has directed the Federal Reserve Bank of Richmond to Union has also recently issued an enhanced CRA monitor First Union's progress in implementing the statement along the lines suggested by the Agency CRA programs and policies as described to the Board, CRA Statement. In addition, the banks have begun and to report to the Board quarterly on First Union's geocoding their loan portfolio and analyzing the geo- progress. In this regard, as a condition of its approval, graphic distribution of their lending activities, have First Union and its bank subsidiaries must submit formulated specific action plans to increase lending periodic reports (no less infrequently than quarterly) activities in 18 key communities to address weak- to the Federal Reserve Bank of Richmond that include nesses noted in the banks' CRA performance in those a description of the steps First Union has taken to communities, and have committed more than $50 comply with its representations to the Board, the million to fund lending consortiums and pools to results of First Union's loan analysis for communities increase lending in low- and moderate-income commu- served by its banks, as well as specific steps it has nities in Florida and North Carolina. Thus, although implemented to improve its CRA performance.21 the record indicates that First Union must continue to improve its CRA performance, First Union has taken Nonbanking Acquisitions significant steps to improve its CRA performance, and has established the types of programs and corporate First Union has also applied, pursuant to section structures necessary to continue to strengthen that 4(c)(8) of the BHC Act, to acquire the investment CRA performance.20 advisory and credit-related insurance subsidiary of In light of the significant public benefits that may be Florida National. As noted above, these activities are expected from First Union's proposal to make its permissible for bank holding companies under the financial and managerial resources available to Florida Board's Regulation Y. First Union operates subsidiar- National and the significant steps taken by First Union ies that compete directly with Florida National in to improve the CRA performance of its bank subsidiaries, and based on all the other facts of record in this case, the Board believes that First Union's CRA 21. Protestant has requested a public meeting or hearing on the record does not, when viewed in the context of the applications to provide testimony on the issues presented by these overall convenience and needs of the community, applications. Although section 3(b) of the BHC Act does not require a public meeting or hearing in this instance, the Board may, in its preclude approval of these applications. For these discretion, order a public meeting or hearing. See 12 C.F.R. 262.3(e). reasons, the Board also believes that, on balance, the In that regard, the Board's Rules of Procedure provide that a public convenience and needs factor the Board must consider meeting may be held to clarify factual issues related to an application or to provide an opportunity for interested persons to testify. 12 C.F.R. 262.25(d). In addition, under the provisions of the Board's Regulation Y, 12 C.F.R. 225.23(g), the Board shall order a hearing only if there are disputed issues of material fact that cannot be 20. The Board has received letters from the Florida State Confer- resolved in some other manner. ence of Branches of the National Association for the Advancement of The Board has carefully considered the Protestant's request for a Colored People and from the Jacksonville Urban League, Inc., public meeting or hearing. In the Board's view, the parties have had commending First Union's record of participation in community ample opportunity to present their arguments in writing and to development activities and serving the banking needs of local com- respond to one another's submissions. In light of these facts, the munities in Florida. These comments note in particular the improve- Board has determined that a public meeting or hearing is not necessary ment in First Union's CRA performance in recent years and First to clarify the factual record in these applications, or otherwise Union's willingness to repair perceived deficiencies in its CRA per- warranted in this case. Accordingly, Protestant's request for a public formance. meeting or hearing on these applications is hereby denied. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 89 APPENDIX Effect on Competition in the Markets Where First Union and Florida National Compete* Existing Resulting Market Increase HHI HHI North Brevard County 1151 93 1244 South Brevard County 884 15 899 Daytona Beach 1103 192 1295 Gainesville 1204 261 1465 Indian River County 970 267 1237 North Lake County 1133 91 1224 Miami—Fort Lauderdale 433 14 447 New Smyrna Beach 1438 81 1519 Orlando 1287 53 1340 East Palm Beach County 538 56 594 Pensacola 1110 60 1170 Pinellas County 594 20 614 West Polk County 1521 97 1618 Port Charlotte 1283 44 1327 North Seminole County 1556 37 1593 St. Johns County 3033 191 3224 Tampa 1075 22 1097 West Volusia County 1508 38 1546 (*—Thrift deposits included at 50 percent) these activities. Each of these subsidiaries has a small pursuant to delegated authority. The determinations as market share and there are numerous competitors for to the nonbanking activities are subject to all of the these services. As a result, consummation of the conditions contained in Regulation Y, including those proposal would have a de minimis effect on existing in sections 225.4(d) and 225.23(b)(3) (12 C.F.R. competition for these services, and the Board con- 225.4(d) and 225.23(b)(3)), and to the Board's authorcludes that the proposal would not have any signifi- ity to require such modification or termination of the cantly adverse effect on existing or probable future activities of a holding company or any of its subsidiarcompetition in any relevant market. Furthermore, ies as the Board finds necessary to assure compliance there is no evidence in the record to indicate that with, or prevent evasion of, the provisions and purapproval of this proposal would result in undue con- poses of the BHC Act and the Board's regulations and centration of resources, unfair competition, conflicts orders issued thereunder. of interests, unsound banking practices, or other ad- By order of the Board of Governors, effective verse effects on the public interest. Accordingly, December 22, 1989. based on all the facts of record, the Board has determined that the balance of public interest factors it must Voting for this action: Chairman Greenspan and Governors consider under section 4(c) (8) of the BHC Act is Johnson, Seger, Kelley, and La Ware. Absent and not voting: favorable and consistent with approval of First Governor Angell. Union's application to acquire the nonbanking subsidiaries of Florida National. JENNIFER J. JOHNSON Associate Secretary of the Board Conclusion MNC Financial, Inc. Baltimore, Maryland Based on the foregoing and other facts of record, including First Union's divestiture and CRA commitments, the Board has determined that the applications Order Approving Merger of Bank Holding under sections 3 and 4 of the BHC Act should be, and Companies hereby are, approved. The proposal shall not be consummated before the thirtieth calendar day follow- MNC Financial, Inc., Baltimore, Maryland ("MNC"), ing the effective date of this Order, or later than three a bank holding company within the meaning of the months after the effective date of this Order, unless Bank Holding Company Act ("BHC Act"), has such period is extended for good cause by the Board or applied for the Board's approval under section 3 of by the Federal Reserve Bank of Richmond, acting the BHC Act (12 U.S.C. § 1842), to merge with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

90 Federal Reserve Bulletin • February 1990 Equitable Bancorporation, Baltimore, Maryland effect upon the concentration of commercial banking ("Equitable"), and thereby indirectly acquire Equi- resources in Maryland. table Bank, N.A., Baltimore, Maryland, and Equita- MNC and Equitable compete directly in the Baltible Bank of Delaware, Dover, Delaware. MNC also more, Maryland; Annapolis, Maryland; Sussex has applied for the Board's approval under section County, Delaware; and Washington, D.C. banking 4(c)(8) of the BHC Act to acquire the nonbanking markets. In the Baltimore market,3 MNC is the subsidiaries of Equitable.1 largest of 38 commercial banking organizations, con- MNC has also provided notice under section trolling $4.2 billion in deposits, representing approx- 4(c)(13) of the BHC Act (12 U.S.C. § 1843(c)(13)) of imately 22.8 percent of total deposits in commercial its intent to acquire Equitable Bancorporation Over- banking organizations in the market ("market seas Finance N.V., which is a foreign corporation that deposits").4 Equitable is the second largest commerengages in raising funds for its parent. cial banking organization in the Baltimore market, Notice of the applications, affording interested per- controlling $2.5 billion in deposits, representing apsons an opportunity to submit comments, has been proximately 13.6 percent of market deposits. Upon published (54 Federal Register 40,519 (1989)). The consummation of this proposal, MNC would control time for filing comments has expired, and the Board $6.7 billion in deposits, representing approximately has considered the applications and all comments 36.4 percent of market deposits. The Baltimore bankreceived in light of the factors set forth in sections 3(c) ing market is considered moderately concentrated, and 4 of the BHC Act. with the four largest commercial banking organiza- MNC controls commercial banking institutions in tions controlling 61.5 percent of the market deposits. Maryland and Washington, D.C., as well as a credit The Herfindahl-Hirschman Index ("HHI") for the card bank in Delaware. MNC is the largest commercial market is 1210 and would increase by 620 points to banking organization in Maryland, controlling deposits 1830 upon consummation of the proposal.5 of $6.5 billion, representing approximately 18.7 per- Although consummation of the proposal would cent of the total deposits in commercial banks in the eliminate some competition in the Baltimore banking state.2 Equitable operates a commercial bank subsid- market, thirty-seven commercial banking organizaiary in Maryland and a credit card bank in Delaware. tions would continue to operate in the market after Equitable is the fourth largest commercial banking consummation of this proposal. In addition, the organization in Maryland, with deposits of $3.3 billion, Board has considered the presence of thrift institurepresenting 9.4 percent of the total deposits in com- tions in the Baltimore banking market in its analysis mercial banks in the state. Upon consummation of the of this proposal.6 Thrift institutions control approxiproposal, MNC would remain the largest commercial mately 31.1 percent of the combined deposits of banking organization in Maryland, controlling deposits banks and thrift institutions in the market and exert a of approximately $9.8 billion, representing approxi- considerable competitive influence on the market as mately 28.1 percent of the total deposits in commercial providers of NOW accounts and consumer loans. banking organizations in Maryland. Consummation of this proposal would not have a significantly adverse 3. The Baltimore banking market is defined as the Baltimore, Maryland, RMA plus the remainder of Harford County, Maryland. 4. Market data are as of June 30, 1988. 1. MNC proposes to acquire E.B. Mortgage Corporation, Towson, 5. Under the revised Department of Justice Merger Guidelines, 49 Maryland, and thereby engage in making, acquiring, and servicing Federal Register 26,823 (June 29, 1984), a market in which the mortgage loans for its own account and the accounts of others; post-merger HHI is above 1800 is considered highly concentrated. In Internet, Inc., Reston, Virginia, and thereby engage in providing data such markets, the Department is likely to challenge a merger that processing switching services for automated teller machine and point increases the HHI by more than 50 points. The Department has of sale networks and providing and maintaining data processing informed the Board that a bank merger or acquisition generally will software to banks and other financial institutions; Equiban Life not be challenged (in the absence of other factors indicating anticom- Insurance Company, Baltimore, Maryland, and thereby engage in petitive effects) unless the post-merger HHI is at least 1800 and the underwriting, as reinsurer, credit life, accident and health insurance merger increases the HHI by 200 points. The Justice Department has and involuntary unemployment insurance in connection with exten- stated that the higher than normal HHI thresholds for screening bank sions of credit by Equitable Bancorporation's subsidiaries and Fayette mergers for anticompetitive effects implicitly recognize the competi- Insurance Corporation, Baltimore, Maryland, and thereby engage in tive effect of limited-purpose lenders and other non-depository finanacting as agent or broker for the sale of credit life, accident and health cial entities. insurance solely in connection with extensions of credit by Equitable 6. The Board previously has indicated that thrift institutions have Bancorporation's subsidiaries. become, or have the potential to become, important competitors of These activities are authorized for bank holding companies pursu- commercial banks. See National City Corporation, 70 Federal Reant to the Board's Regulation Y, 12 C.F.R. 225.25(b)(1), (7) and (8)(i). serve Bulletin 743 (1984); The Chase Manhattan Corporation, 70 In connection with this application, MNC has also applied to Federal Reserve Bulletin 529 (1984); NCNB Bancorporation, 70 acquire common stock equal to 24.9 percent of Equitable's voting Federal Reserve Bulletin 225 (1984); General Bancshares Corporashares. tion, 69 Federal Reserve Bulletin 802 (1983); First Tennessee Corpo- 2. State banking data are as of June 30, 1989. ration, 69 Federal Reserve Bulletin 298 (1983). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 91 Based upon the size, number, and market share of ing approximately 3.3 percent of such loans nationthrift institutions in the Baltimore banking market, wide. Consummation of this proposal would not have the Board has concluded that thrift institutions exert a significantly adverse effect on competition in the a competitive influence that mitigates the anticom- market for credit card services.10 petitive effects of this proposal in the Baltimore In evaluating these applications, the Board has market.7 considered the financial and managerial resources of The Board has also examined the effects of this MNC, Equitable, and their bank subsidiaries, and proposal in the three other banking markets where the effect of the proposed acquisition on the re- MNC and Equitable compete: Annapolis, Maryland; sources and future prospects of these companies. Sussex County, Delaware; and Washington, D.C.8 The Board has stated and continues to believe that The proposed acquisition would not substantially capital adequacy is an important factor in the analyincrease the market share of MNC in any market. sis of bank holding company expansion proposals.11 Upon consummation of this proposal, the HHI would In this regard, the Board expects banking organizaincrease by less than 200 points in each of these tions contemplating expansion proposals to maintain markets, and each of these banking markets would strong capital levels substantially above the miniremain moderately concentrated. In addition, numer- mum levels specified in the Board's Capital Adeous competitors would remain in each market. quacy Guidelines12 without significant reliance on Accordingly, based on the facts of record in this intangibles, in particular goodwill. The Board carecase, the Board has determined that consummation fully analyzes the effect of expansionary proposals of the proposal would not have a significantly ad- on the preservation or achievement of strong capital verse effect on existing competition in any relevant levels and has adopted a policy that there should be banking market. The Board also has considered the no significant diminution of financial strength below effects of the proposal on probable future competi- these levels for the purpose of effecting major expantion in relevant markets. In light of the market sion proposals.13 concentration and the number of probable future MNC proposes to accomplish the merger through an entrants into those markets, the Board concludes exchange of shares. MNC will remain well-capitalized that consummation of this proposal would not have a following consummation of the proposal, with capital significantly adverse effect on probable future com- ratios above the minimum levels specified in the petition in any relevant market. Board's Capital Adequacy Guidelines, and its primary MNC and Equitable operate credit card banks that capital ratio will decrease only slightly. Accordingly, provide credit card services on a nationwide basis.9 based on these and all of the other facts of record, the MNC is the ninth largest provider of bank credit card Board concludes that financial and managerial considloans in the United States, with outstanding receiv- erations are consistent with approval of this applicaables of $2.2 billion, representing 2.7 percent of bank tion. Considerations relating to the convenience and credit card receivables in the United States. Equitable needs of the communities to be served are also conhas outstanding credit card loans of less than sistent with approval.14 $0.5 billion, representing less than one percent of such MNC also has applied, pursuant to section 4(c)(8) of credit card receivables. Upon consummation of the the BHC Act, to acquire certain nonbanking subsidproposal, MNC would control approximately $2.7 billion in bank credit card receivables, represent- 10. Data are as of December 31, 1987. 11. The Bank of New York Company, Inc., 74 Federal Reserve Bulletin 257 (1988); Chemical New York Corporation, 73 Federal Reserve Bulletin 378 (1987); Citicorp, 72 Federal Reserve Bulletin 497 7. If 50 percent of the deposits held by thrift institutions were (1986); National City Corporation, 70 Federal Reserve Bulletin lA'i included in the calculation of market concentration, MNC's pro forma (1984). market share would be 29.7 percent and the HHI would increase by 12. Capital Adequacy Guidelines, 50 Federal Register 16,057 412 points to 1235. (April 24, 1985). 8. The Annapolis, Maryland banking market is approximated by the 13. Thus, for example, the Board has generally approved proposals Annapolis, Maryland, RMA. The Sussex County, Delaware banking involving a decline in capital only where the applicants have promptly market is approximated by Sussex County, Delaware, Wicomico restored their capital to pre-acquisition levels following consumma- County, Maryland, and the adjoining portions of Caroline, Dorchester tion of the proposals and have implemented programs of capital and Worcester Counties in Maryland. The Washington, D.C. banking improvement to raise capital significantly above minimum levels. See, market is approximated by the Washington, D.C., RMA. Market data e.g., Citicorp, 72 Federal Reserve Bulletin 726 (1986); Security Pacific are as of June 30, 1988. Corporation, 72 Federal Reserve Bulletin 800 (1986). 9. The Board has previously determined that the relevant market for 14. The Board has received a comment on the proposal from the credit card services is nationwide. First Chicago Corporation, 73 Maryland Alliance for Responsible Investment ("MARI"), which Federal Reserve Bulletin 600 (1987); RepublicBank Corporation, 73 supports the proposed merger based on MNC's "good faith efforts to Federal Reserve Bulletin 510 (1987); Chemical New York Corpora- address its obligations under the MARI-MNB Community Reinvesttion, 73 Federal Reserve Bulletin 378 (1987). ment Agreement." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

92 Federal Reserve Bulletin • February 1990 iaries of Equitable. MNC and Equitable operate sub- APPENDIX sidiaries that engage in permissible data processing, mortgage lending and insurance activities. The market Nonbanking Subsidiaries to be Acquired share controlled by each of these subsidiaries is small, and there are numerous competitors for their services. Maryland National Pennsylvania Corporation, Phila- Accordingly, consummation of this proposal would delphia, Pennsylvania, and thereby engage in making have a de minimis effect on competition in each of loans for its own account and on behalf of others these markets, and the Board concludes that the pursuant to Section 225.25(b)(1); MN Credit Corporaproposal would not have any significantly adverse tion, Baltimore, Maryland, and thereby originate coneffect on competition in the provision of these services sumer loans and personal property leases for itself and in any relevant market. Furthermore, there is no bank pursuant to Section 225.25(b)(1); MN Services evidence in the record to indicate that approval of this Corporation, Baltimore, Maryland, and thereby enproposal would result in undue concentration of re- gage in mortgage banking and brokerage business, sources, decreased or unfair competition, conflicts of leasing of real or personal property, negotiating loans, interests, unsound banking practices, or other adverse and dealing with payments of mortgages, pursuant to effects on the public interest. Accordingly, the Board Section 225.25(b)(1); ReCap, Inc., Wilmington, Delahas determined that the balance of public interest ware, and engage in real estate workout activities, factors it must consider under section 4(c)(8) of the pursuant to Section 225.25(b)(1); American Security BHC Act is favorable and consistent with approval of Investment Services, Inc., Washington, D.C., and MNC's application to acquire the nonbanking subsid- thereby engage in providing discount brokerage seriaries of Equitable. vices pursuant to Section 225.25(b)(15); ASB Capital The Board has also considered MNC's notice of Management, Inc., Washington, D.C., and thereby intent to acquire Equitable Bancorporation Overseas engage in acting as an investment advisor pursuant to Finance N.V. under section 4(c)(13) of the BHC Act Section 225.25(b)(19); MNC Credit Corp., Towson, and has determined that disapproval of the acquisition Maryland, and thereby engage in servicing commercial is not warranted. loans and leases for affiliated or unaffiliated individu- Based on the foregoing and other facts of record, als, partnerships, corporations or other entities, acting the Board has determined that the applications as advisor or broker in leasing of equipment and should be, and hereby are, approved. The transac- personal property, commercial and equipment leasing tion shall not be consummated before the thirtieth transactions; leasing of personal property, originating, calendar day following the effective date of this making, acquiring, holding, servicing, and disposing of Order, or later than three months after the effective secured and unsecured loans, lines of credit, mortdate of this Order, unless such period is extended gages and charges on real or personal property, engagfor good cause by the Board or by the Federal ing in mortgage banking, brokering and servicing and Reserve Bank of Richmond, acting pursuant to in selling as agent credit life, disability and accident delegated authority. The determinations as to the and health insurance in connection with extensions of nonbanking activities approved in this case are sub- credit by bank and nonbank subsidiaries of MNC ject to all of the conditions contained in Regulation Financial, Inc., commercial lending, including but not Y, including those in sections 225.4(d) and limited to financing of accounts receivable, invento- 225.23(b)(3), 12 C.F.R. 225.4(d) and 225.23(b)(3), ries, and other types of secured and unsecured loans and to the Board's authority to require such notifi- to commercial enterprises, pursuant to Sections cation or termination of the activities of a holding 225.25(b)(1), (5) and (8); Maryland National Mortgage company or any of its subsidiaries as the Board finds Corporation, Baltimore, Maryland, and thereby ennecessary to assure compliance with, or to prevent gage in mortgage banking, brokering and servicing and evasion of the provisions and purposes of the BHC acting as advisor in mortgage loan transactions, pur- Act and the Board's regulations and orders issued suant to Section 225.25(b)(1); MNC American Corpothereunder. ration, Aurora, Colorado, and thereby engage in in- By order of the Board of Governors, effective dustrial banking and servicing loans pursuant to December 19, 1989. Sections 225.25(b)(1) and (2); MNC Consumer Discount Company, Coraopolis, Pennsylvania, and thereby engage in mortgage banking, brokering, and Voting for this action: Chairman Greenspan and Governors Johnson, Seger, Angell, Kelley, and LaWare. servicing, including but not limited to second mortgage financing, and in originating, buying, selling, and otherwise dealing in loans as principal or agent, pursuant JENNIFER J. JOHNSON Associate Secretary of the Board to Section 225.25(b)(1); Mid-Atlantic Life Insurance Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 93 Company, Coraopolis, Pennsylvania, and thereby en- financial institutions for the operation of this hardgage in underwriting, as reinsurer, credit life and credit ware, and maintain ATM and POS data bases for some accident and health insurance on loans and other banks and financial institutions pursuant to section extensions of credit made by subsidiaries of MNC 225.25(b)(7) of the Board's Regulation Y. Financial, Inc. and originated in Maryland, Ohio, Pennsylvania, New Jersey, Virginia and by American Provident Bancorp, Inc. Industrial Bank, pursuant to Section 225.25(b)(8); Cincinnati, Ohio Landmark Financial Services, Inc., Silver Spring, Maryland, and thereby engage in making, acquiring Order Approving the Merger of Bank Holding and servicing consumer, real estate and sales finance Companies loans, acting as broker for credit life, health and accident insurance, reinsuring credit life, health and Provident Bancorp, Inc., Cincinnati, Ohio ("Proviaccident insurance sold by Landmark Financial Ser- dent"), has applied for the Board's approval under vices, Inc., providing automobile insurance premium section 3 of the Bank Holding Company Act (the financing, providing data processing services related "Act") (12 U.S.C. § 1842) to merge with Northern to such premium financing, pursuant to Sections Kentucky Trustcorp, Alexandria, Kentucky ("NKT"), 225.25(b)(1), (7), 8(ii) and 8(iii); Virginia Federal Sav- and thereby acquire 100 percent of the voting shares of ings Bank, Richmond, Virginia, and engage in operat- NKT's subsidiary bank, Northern Kentucky Bank and ing and controlling a savings association, pursuant to Trust Company, Alexandria, Kentucky ("Kentucky Section 225.25(b)(9); First Service Corporation of Vir- Bank"). Provident has also applied under section ginia, Richmond, Virginia, and engage in managing 4(c)(8) of the Act to acquire Northern Kentucky Finanreal property acquired in loan workouts, pursuant to cial Corporation, Florence, Kentucky ("Finance Com- Section 225.25(b)(1); Southern Condominium Service, pany"), a nonbanking subsidiary of NKT which is Incorporated, Richmond, Virginia, and engage in man- engaged in consumer finance activities pursuant to aging real property acquired in loan workouts, pursu- section 225.25(b)(1) of the Board's Regulation Y ant to Section 225.25(b)(1); Southern Hotel Service, (12 C.F.R. 225.25(b)(1)). Incorporated, Richmond, Virginia, and engage in man- Notice of the applications, affording an opportunity aging real property acquired in workouts of loans of for interested parties to submit comments, has been Virginia Federal Savings Bank, pursuant to Section duly published (54 Federal Register 24,593 (1989)). 225.25(b)(1); Southern Finance Corporation, Rich- The time for filing comments has expired, and the mond, Virginia, and engage in CMO-arbitrage trans- Board has considered the applications and all comactions pursuant to Section 225.25(b)(9); E.B. Mort- ments received in light of the factors set forth in gage Corporation, Towson, Maryland, and thereby sections 3(c) and 4(c) of the Act. engage in making, acquiring, and servicing mortgage Section 3(d) of the Act, the Douglas Amendment, loans for its own account and the accounts of others prohibits the Board from approving an application by a pursuant to section 225.25(b)(1); Equiban Life Insur- bank holding company to acquire control of any bank ance Company, Baltimore, Maryland, and thereby located outside of the holding company's home state,1 engage in underwriting, as reinsurer, credit life, acci- unless such acquisition is "specifically authorized by dent and health insurance and involuntary employ- the statute laws of the State in which [the] bank is ment insurance in connection with extensions of credit located, by language to that effect and not merely by by Equitable Bancorporation's subsidiaries, including implication." 12 U.S.C. § 1842(d). The Board previ- Equitable Bank, N.A., Equitable Bank of Delaware, ously has concluded that the laws of Kentucky exand E.B. Mortgage Corporation pursuant to pressly authorize the acquisition of Kentucky banks 225.25(b)(8); Fayette Insurance Corporation, Balti- by Ohio bank holding companies, such as Provident.2 more, Maryland, and thereby engage in acting as agent Accordingly, the Board's approval of these applicaor broker for the sale of credit life, accident and health tions is not precluded by the Douglas Amendment. insurance solely in connection with extensions of The Board's approval, however, is subject to Provicredit by Equitable Bancorporation's subsidiaries, in- dent's obtaining approval of the merger and acquisicluding Equitable Bank, N.A., Equitable Bank of Delaware, and E.B. Mortgage Corporation pursuant to section 225.25(b)(8); and Internet, Inc., Reston, Vir- 1. A bank holding company's home state is that state in which the operations of the bank holding company's banking subsidiaries were ginia, and thereby engage in providing data processing principally conducted on July 1, 1966, or the date on which the switching services for automatic teller machine and company became a bank holding company, whichever is later. point of sale networks. Internet, Inc. also provides and 2. National City Corporation, 73 Federal Reserve Bulletin 581 (1987). (See Ky. Rev. State. Ann. § 287.900 (Michie/Bobbs-Merrill maintains data processing software to banks and other 1986)). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

94 Federal Reserve Bulletin • February 1990 tion from the Kentucky Commissioner of Banking and requires the federal financial supervisory agencies to Securities, as required by Kentucky law. encourage financial institutions to help meet the credit Provident, a one-bank holding company, is the 11th needs of the local communities in which they operate, largest commercial banking organization in Ohio, con- consistent with the safe and sound operation of such trolling deposits of approximately $1.6 billion, repre- institutions. To accomplish this end, the CRA requires senting approximately 1.9 percent of deposits in com- the appropriate federal supervisory authority to "asmercial banks in the state.3 NKT is the 121st largest sess an institution's record of meeting the credit needs commercial banking organization in Kentucky, con- of its entire community, including low- and moderatetrolling deposits of approximately $51.1 million, rep- income neighborhoods, consistent with the safe and resenting less than one percent of deposits in commer- sound operation of the institution," and to "take this cial banks in the state. Consummation of this proposal record into account in its evaluation of bank holding would not have a significant adverse effect on the company applications." 6 concentration of banking resources in Kentucky. The Board has carefully reviewed the CRA perfor- Provident and NKT compete in the Cincinnati bank- mance record of Bank7 in light of the CRA, the Board's ing market.4 Provident is the fourth largest commercial regulations, and the jointly issued "Statement of the banking organization in the market, controlling ap- Federal Financial Supervisory Agencies Regarding the proximately $1.2 billion in deposits, representing ap- Community Reinvestment Act" ("CRA Joint proximately 10.5 percent of the total deposits in com- Statement").8 The CRA Joint Statement provides guidmercial banking organizations in the market. NKT is ance regarding the types of policies and procedures that the 16th largest commercial banking organization in the supervisory agencies believe financial institutions the market, controlling approximately $46.5 million in should have in place in order to fulfill their responsibildeposits, representing less than one percent of the ities under the CRA on an ongoing basis, and the total deposits in commercial banking organizations in procedures that the supervisory agencies will use durthe market. Upon consummation of this transaction, ing the application process to review an institution's Provident would remain the fourth largest commercial CRA compliance and performance. banking organization in the market, controlling ap- Initially, the Board notes that Bank has received proximately $1.25 billion in deposits, representing satisfactory ratings from its primary regulator in the approximately 10.9 percent of the total deposits in most recent examination of its CRA performance. In commercial banking organizations in the market. addition, Provident has put into place the types of While the merger of NKT into Provident would elim- programs outlined in the CRA Joint Statement as inate one competitor from the market, it would pro- essential to an effective CRA program. Provident has duce only a minimal increase in the concentration of established a coordinated procedure to enable it to market deposits. The Herfindahl-Hirschman Index ascertain community credit needs and to market its ("HHI") would increase from 1458 to 1467.5 On the financial services to all segments of the community. basis of the foregoing and other facts of record, the Bank's Products Committee—comprised of members Board concludes that consummation of this proposal would not have a substantial adverse effect on competition in the Cincinnati banking market. 6. 12 U.S.C. § 2903. The financial and managerial resources and future 7. In this regard, the Board notes that comments were filed by the prospects of Provident, NKT, and their respective Cincinnati Association of Real Estate Brokers ("CAREB") alleging that Bank has discriminated against blacks in its mortgage lending, subsidiaries are consistent with approval. business relationships, and hiring practices. Subsequently, the Black In considering the convenience and needs of the Taxpayers Association, the Black Community Forum, and the Coalicommunities to be served, the Board has taken into tion of Neighborhoods, all of Cincinnati, Ohio, forwarded separate correspondence in support of CAREB's allegations. All of these account the record of Provident's subsidiary bank, comments were received well after the expiration of the public Provident Bank, Cincinnati, Ohio ("Bank"), under the comment period. Community Reinvestment Act ("CRA"). The CRA The Board's Rules of Procedure provide that "a commenter who fails to comment on an application within the specified comment period (or any extension) may be precluded from participating in the consideration of the application." See 12 C.F.R. 262.25(b)(1), 3. State banking data are as of June 30, 1989; market data are as of 262.25(b)(2); see also "Statement of the Federal Financial Supervi- June 30, 1988. sory Agencies Regarding the Community Reinvestment Act," (54 4. The Cincinnati banking market is approximated by Hamilton Federal Register 13,742,13,746-7 (1989)). In any event, the Board has County, Clermont County, and portions of Butler and Warren Coun- carefully reviewed the CRA performance record of Provident and ties in Ohio; Dearborn County, Indiana; and Boone County, Kenton Bank, including its record of lending in low- and moderate-income County, Campbell County, Grant County and Pendleton County, neighborhoods and in minority neighborhoods, and, as discussed Kentucky. above, has determined that the record does not indicate that Bank 5. Under the revised Department of Justice Merger Guidelines, engages in racially discriminatory lending practices, or that the CRA 49 Federal Register 26,823 (1984), this market is considered moder- performance record of Bank warrants denial of this application. ately concentrated. 8. 54 Federal Register 13,742 (1989). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 95 of Bank's loan, finance, legal, community relations, facts of record, the Board concludes that convenience and marketing divisions—meets quarterly and pro- and needs considerations, including the record of vides the vehicle through which decisions are made performance under the CRA of Bank, are consistent concerning community credit needs. The CRA Com- with approval of these applications. mittee meets monthly to review current CRA-related Provident has also applied to acquire 100 percent of topics. Recommendations are made by the CRA Com- the voting shares of Finance Company. Finance Committee to the Products Committee regarding meeting pany makes, acquires, and services loans—for its own agenda subjects, statistical reports, and internal CRA account or for the account of others—of the type that activities. Bank has authorized the Products Commit- would be made by a consumer or commercial finance tee to approve any new products or product modifica- or factoring company. The Board previously has detions in furtherance of Bank's CRA performance. termined that such activities are permissible for bank Bank has sought minority mortgage loan applicants holding companies under section 225.25(b)(1) of the by means of a direct marketing campaign. Loan orig- Board's Regulation Y. (12 C.F.R. 225.25(b)(1)). inators make calls on minority realtors and to realtors In light of the facts of record, the Board concludes in low- and moderate-income areas. A listing of all that Provident's acquisition of Finance Company loan originator calls conducted is compiled by the would not significantly affect competition in any rele- Bank's Finance Department so that a geographical file vant market. Furthermore, there is no evidence in the by census tract can be maintained by Bank.9 record to indicate that approval of this proposal would In addition, Provident has recently implemented var- result in undue concentration of resources, unfair ious measures to improve Bank's CRA performance, competition, conflicts of interest, unsound banking particularly in areas where some deficiencies had been practices, or other adverse effects on the public internoted in past CRA examinations.10 In particular, Prov- est. Accordingly, the Board has determined that the ident has solicited product ideas from and attempted to balance of the public interest factors it must consider generate business with low- and moderate-income indi- under section 4(c)(8) of the Act is favorable and viduals through a direct marketing campaign and by consistent with approval. holding informal meetings between Bank officials and Based on the foregoing and other facts of record, the residents in low- and moderate-income neighborhoods. Board has determined that the applications should be, In an effort to further improve its geographic loan and hereby are, approved. The bank holding company distribution and to attract minority customers, Provi- merger shall not be consummated before the thirtieth dent is utilizing three minority-owned publications and calendar day following the effective date of this Order, one minority-owned radio station in the Cincinnati area and neither the bank holding company merger nor the to advertise Bank's recently-approved status as an nonbanking acquisition shall occur later than three underwriter of FHA/VA mortgage loans. Provident also months after the effective date of this Order, unless the has committed to establish a $2.5 million warehouse latter period is extended for good cause by the Board pool to fund special minority and low-income loans and or by the Federal Reserve Bank of Cleveland, acting loan programs administered by the City of Cincinnati. pursuant to delegated authority. The determination Finally, Bank has acted to improve its efforts to moni- with respect to Bank's acquisition of Finance Comtor and evaluate its CRA performance, consistent with pany is subject to all of the conditions set forth in the CRA Joint Statement, by completing a "CRA Regulation Y, including those in sections 225.4(b) and Self-Audit" in May 1989. 225.23(b), and to the Board's authority to require For the foregoing reasons, and based upon the modification or termination of the activities of a holdoverall CRA record of Bank, the compliance of Bank's ing company or any of its subsidiaries as the Board CRA statement with applicable regulations, and other finds necessary to assure compliance with the provisions and purposes of the Act and the Board's regulations and orders issued thereunder, or to prevent evasion thereof. 9. In contrast to Protestants' claims, available evidence indicates that during the period August, 1988 to June, 1989, Bank's rate of By order of the Board of Governors, effective denial of minority mortgage loan applications decreased by almost 20 December 13, 1989. percent while the proportion of such applications to the total number of mortgage loan applications increased from 3 percent to 7 percent. When compared to the Metropolitan Statistical Area ("MSA") minor- Voting for this action: Chairman Greenspan and Governors ity population percentage (13.5%), Bank has improved its minority Johnson, Seger, and Kelley. Absent and not voting: Goverapplication pool (10%) to more closely reflect the composition of the nors Angell and La Ware. MSA. Furthermore, denied minority applicants are subject to two credit reviews by Bank. 10. In this regard, the Board notes that the most recent CRA JENNIFER J. JOHNSON examination report stated that there was no evidence of discriminatory or illegal credit practices on the part of Bank. Associate Secretary of the Board Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

96 Federal Reserve Bulletin • February 1990 Orders Issued Under Financial Institution insured by the other deposit insurance fund. Thus, Reform, Recovery and Enforcement Act with certain limited exceptions, FIRREA prevents a bank that is a BIF member from acquiring SAIF Central Bank insured deposits for the next five years. FIRREA Hollidaysburg, Pennsylvania provides an exception from this five year moratorium for the transfer of deposit liabilities between a BIF Order Approving Acquisition of Assets and member and a SAIF member where such transfer is Assumption of Liabilities of a Savings Association, deemed to affect an "insubstantial portion, as deterthe Establishment of Branches, and Additional mined by the [FDIC], of the total deposits of each Investment in Bank Premises insured depository institution participating in the conversion transaction." (12 U.S.C. § 1815(d)(2)(C)(i)). Central Bank, Hollidaysburg, Pennsylvania ("Cen- The Act defines an "insubstantial portion" of the tral"), a state member bank, has applied for the total deposits of an insured depository institution to be Board's approval under section 18(c) of the Federal no more than 35 percent of the total deposits of each Deposit Insurance Act (12 U.S.C. § 1828(c)) (the institution.2 This quantitative limitation applies to both "Bank Merger Act") to purchase certain assets from the acquiring institution and the selling institution. In and assume certain liabilities of two branches of Land- addition to applying to each individual transaction, the mark Savings Association, Pittsburgh, Pennsylvania 35 percent limit applies to the aggregate of all transac- ("Landmark"). Central has also applied to establish tions involving the institution during the five year branches at the locations of these offices pursuant to moratorium period. section 9 of the Federal Reserve Act (12 U.S.C. In the proposed transaction, the deposit liabilities § 321) and for permission to make an additional invest- ($17.0 million)3 to be assumed by Central, a BIF ment in bank premises pursuant to section 24A of the member, represent approximately nine percent of Federal Reserve Act (12 U.S.C. § 371d). Central's total deposits and less than two percent of Notice of the proposal, affording an opportunity for the total deposits of Landmark, a SAIF member.4 This interested persons to submit comments, has been is the first deposit transfer subject to FIRREA by given in accordance with the Bank Merger Act and the either institution. Accordingly, this proposal is a per- Board's Rules of Procedure (12 C.F.R. 262.3(b)). As missible conversion transaction under FIRREA. required by the Bank Merger Act, reports on the FIRREA requires that all conversion events be apcompetitive effects of the merger were requested from proved by the Federal Deposit Insurance Corporation the United States Attorney General, the Office of the ("FDIC").5 Central has applied for FDIC approval of Comptroller of the Currency, and the Federal Deposit this transaction under FIRREA, and the Board's ac- Insurance Corporation. The time for filing comments tion in this case is conditioned on Central obtaining the has expired, and the Board has considered the appli- necessary FDIC approval. cations and all the comments received in light of the Central is the 58th largest commercial banking orfactors set forth in the Bank Merger Act (12 U.S.C. ganization in Pennsylvania, with total deposits of § 1828(c)(5)). $173.8 million, which represents less than one percent As part of this transaction, Central, a Bank Insur- of total deposits in commercial banking organizations ance Fund ("BIF") member, has proposed to assume in the state. The Landmark offices Central proposes to certain deposit liabilities of Landmark, a Savings acquire hold total deposits of $18.8 million, represent- Association Insurance Fund ("SAIF") member. As- ing less than one percent of total deposits in commersumption of such deposit liabilities is a "conversion cial banks and thrift institutions in the state. Upon transaction" governed by the terms of section consummation of this proposal, Central would become 5(d)(2)(C)(i) of the Federal Deposit Insurance Act ("FDI Act"), 12 U.S.C. § 1815(d)(2)(C)(i). Section 2. The 35 percent figure is measured against the lesser of: (i) total 206 of the Financial Institutions Reform, Recovery, deposits as of May 1, 1989, plus accrued interest until the date of and Enforcement Act of 1989 ("FIRREA" or "the transfer of the deposits in connection with the transaction; or (ii) total Act")1 amended section 5 of the FDI Act to provide, deposits as of the date the deposits are transferred. (FIRREA, Pub. L. No. 101-73, § 206(a)(7) to be codified at 12 U.S.C. § 1815(d)(2)(C)(i)). as a general matter, that until August 9, 1994, no 3. Central does not propose to assume all of the $18.8 million in insured depository institution may participate in a deposits currently held in these branches. transaction in which deposits insured by one insurance 4. As of May 1, 1989, Central controlled $180.1 million in deposits, and Landmark controlled $1.2 billion in deposits. fund become the obligation of a depository institution 5. Prior approval of the FDIC is required for any conversion transaction, including transactions affecting an insubstantial portion of the total deposits of each depository institution. See FIRREA, Section 206(a)(7)), Pub. L. No. 101-73, 103 Stat. 183, 197 (1989) to be codified 1. Pub. L. No. 101-73, § 206(a)(7), 103 Stat. 183, 197 (1989). at 12 U.S.C. §§ 1815 (d)(2)(a)(i) and (C)(i). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 97 the 52nd largest commercial banking organization in extended for good cause by the Board or by the the state, still controlling less than one percent of total Federal Reserve Bank of Philadelphia, pursuant to deposits in commercial banking organizations in the delegated authority. state.6 By order of the Board of Governors, effective Central and Landmark do not compete directly in December 6, 1989. the banking market where the two thrift branches to be acquired are located. In light of the facts of record, Voting for this action: Chairman Greenspan and Governors consummation of this proposal would not have a Johnson, Seger, Angell, Kelley, and LaWare. significant adverse effect on competition in any rele- JENNIFER J. JOHNSON vant market. Associate Secretary of the Board In evaluating this application, the Board has carefully considered the financial resources of Central and the effect on those resources on the proposed acquisi- December 15, 1989 tion. In that regard, the primary capital and tangible primary capital ratios of Central Bank will decline Mr. Peter Mortensen somewhat as a result of the proposed transaction. Chairman of the Board and Chief Executive Officer Central has committed to restore its tangible primary F.N.B. Corporation capital ratio to nearly the preacquisition level within Hermitage Square twelve months of consummation of the proposed 3320 East State Street transaction and to at least preacquisition levels within Hermitage, Pennsylvania 16148 eighteen months. Based on these considerations, the Board concludes that the financial resources of Central Dear Mr. Mortensen: are consistent with approval of the proposal. Managerial and convenience and needs considerations, as well F.N.B. Corporation, Hermitage, Pennsylvania as future earnings prospects, also are consistent with ("F.N.B."), proposes that its bank subsidiary, Reeves approval. Bank, Beaver Falls, Pennsylvania, purchase the assets Central has also applied under section 9 of the and assume the liabilities of Interim Liberty Federal Federal Reserve Act (12 U.S.C. § 321 et seq.), to Savings and Loan, Beaver Falls, Pennsylvania, its establish new branches at the sites of both of the savings association subsidiary, ("Interim Liberty"). Landmark branches that are the subject of this pro- F.N.B. has requested Board approval of this transacposal. The Board has considered the factors it is tion pursuant to section 5(d)(3) of the Federal Deposit required to consider when approving applications for Insurance Act ("FDI Act") as amended by the Finanestablishing branches pursuant to section 9 of the cial Institutions Reform, Recovery, and Enforcement Federal Reserve Act (12 U.S.C. § 322) and finds Act of 1989 (Pub. L. No. 101-73, § 206, 103 Stat. 183, those factors to be consistent with approval. 199 (1989)). Interim Liberty has been established to Central also requests permission under section 24A acquire certain assets and assume deposit liabilities of of the Federal Reserve Act to make an additional Liberty Bell Savings Association, Beaver Falls, Penninvestment in bank premises in connection with this sylvania ("Liberty Bell Savings"). proposal. The additional investment will be used to The record in this case shows that: purchase leasehold improvements of the acquired (1) The aggregate amount of the total assets of all branches. The Board concludes that Central's addi- depository institution subsidiaries of F.N.B. is $1.0 tional investment in bank premises will support Cen- billion, an amount which is not less than 200 percent tral's acquisition of the Landmark branches, and is of the total assets of Interim Liberty, which curconsistent with approval. rently has $79.3 million in total assets; On the basis of the record, the applications are (2) F.N.B. and all of its bank subsidiaries currently approved for the reasons summarized above, subject meet all applicable capital standards and, upon to the condition that Central obtain the approval of the consummation of the proposed transactions, will FDIC for the conversion transaction portion of this continue to meet all applicable capital standards; proposal. The transaction shall not be consummated (3) The transaction is not in substance the acquisibefore the thirtieth calendar day following the effective tion of a Bank Insurance Fund member bank by a date of this Order or later than three months after the Savings Association Insurance Fund member; effective date of this Order, unless such period is (4) Liberty Bell Savings, the predecessor to Interim Liberty, had tangible capital of less than 4 percent during the quarter preceding its acquisition by 6. State and market deposit data are as of June 30, 1989. F.N.B.; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

98 Federal Reserve Bulletin • February 1990 (5) The transaction, which involves the purchase of $9.4 billion, an amount which is not less than 200 assets and assumption of liabilities of Interim Lib- percent of the total assets of Meridian Savings, erty, a savings association located in Pennsylvania, which currently has $2.2 billion in total assets; by a bank subsidiary of F.N.B., a bank holding (2) Meridian and all of its bank subsidiaries curcompany whose banking subsidiaries' operations rently meet all applicable capital standards and, are principally conducted in Pennsylvania, would upon consummation of the proposed transactions, comply with the requirements of section 3(d) of the will continue to meet all applicable capital standards; Bank Holding Company Act if Interim Liberty were (3) The transaction is not in substance the acquisia state bank which F.N.B. was applying to acquire. tion of a Bank Insurance Fund member bank by a Savings Association Insurance Fund member; Based on the foregoing and all of the other facts of (4) Hill Savings, the predecessor to Meridian Savings, record, the Staff Director of the Division of Banking had tangible capital of less than 4 percent during the Supervision and Regulation and the General Counsel quarter preceding its acquisition by Meridian; of the Board, acting pursuant to authority delegated by (5) The transaction, which involves the purchase of the Board of Governors, hereby approve your request assets and assumption of liabilities of Meridian to engage in the proposed transaction under section Savings, a savings association located in Pennsylva- 5(d)(3) of the FDI Act. This approval is subject to nia by a bank subsidiary of Meridian, a bank holding F.N.B. obtaining the required approval of the appro- company whose banking subsidiaries' operations priate Federal banking agency for the proposed merger are principally conducted in Pennsylvania, would under the Bank Merger Act. comply with the requirements of section 3(d) of the Bank Holding Company Act if Meridian Savings Very truly yours, were a state bank which Meridian was applying to acquire. Jennifer J. Johnson Based on the foregoing and all of the other facts of Associate Secretary of the Board record, the Staff Director of the Division of Banking cc: Federal Reserve Bank of Cleveland Supervision and Regulation and the General Counsel of the Board, acting pursuant to authority delegated by the Board of Governors, hereby approve your request October 13, 1989 to engage in the proposed transaction under section 5(d)(3) of the FDI Act. This approval is subject to Timothy F. Demers, Esq. Meridian obtaining the required approval of the appro- Stevens & Less priate Federal banking agency for the proposed merger 607 Washington Street under the Bank Merger Act. Reading, Pennsylvania 19601 Dear Mr. Demers: Very truly yours, Meridian Bancorp, Inc., Reading, Pennsylvania ("Me- William W. Wiles ridian"), proposes that its bank subsidiary, Meridian Secretary of the Board Bank, Reading, Pennsylvania, purchase the assets and assume the liabilities of Meridian Financial Savings cc: Federal Reserve Bank of Philadelphia Association, Red Hill, Pennsylvania ("Meridian Savings"), its savings association subsidiary. Meridian October 13, 1989 has requested Board approval of this transaction pursuant to section 5(d)(3) of the Federal Deposit Insur- Paul J. Polking, Esq. ance Act ("FDI Act") as amended by the Financial Executive Vice President and General Counsel Institutions Reform, Recovery and Enforcement Act NCNB Corporation of 1989 (Pub. L. No. 101-73, § 206, 103 Stat. 183, 199 One NCNB Plaza (1989)). Meridian Savings has been established to Charlotte, North Carolina 28255 acquire certain assets and assume deposit liabilities of Hill Financial Savings Association, Red Hill, Pennsyl- Dear Mr. Polking: vania ("Hill Savings"). The record in this case shows that: NCNB Corporation, Charlotte, North Carolina (1) The aggregate amount of the total assets of all ("NCNB"), proposes that its bank subsidiary, NCNB depository institution subsidiaries of Meridian is National Bank of Florida, Tampa, Florida ("NCNB Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 99 Bank"), purchase the assets and assume the liabilities of December 26, 1989 NCNB Florida Federal Savings Bank, Tampa, Florida ("NCNB Savings"), its savings association sub- Thomas R. Woolsey sidiary. NCNB has requested Board approval of this Senior Vice President, Senior Counsel transaction pursuant to section 5(d)(3) of the Federal and Corporate Secretary Deposit Insurance Act ("FDI Act") as amended by Southeast Banking Corporation the Financial Institutions Reform, Recovery, and One Southeast Financial Center Enforcement Act of 1989 (Pub. L. No. 101-73, § 206, Miami, Florida 33131 103 Stat. 183, 199 (1989)). NCNB Savings has been established to acquire certain assets and assume Dear Mr. Woolsey: deposit liabilities of Freedom Federal Savings and Loan Association, Tampa, Florida ("Freedom"). Southeast Banking Corporation, Miami, Florida The record in this case shows that: ("Southeast"), proposes that its savings association (1) The aggregate amount of the total assets of subsidiary, Southeast Bank for Savings, A Federal all depository institution subsidiaries of NCNB is Savings Bank, Jacksonville, Florida ("Southeast Sav- $58 billion, an amount which is not less than 200 ings"), merge into its bank subsidiary, Southeast percent of the total assets of NCNB Savings, Bank, N.A., Miami, Florida ("Southeast Bank"). which currently has $570 million in total assets; Southeast has requested Board approval of this trans- (2) NCNB and all of its bank subsidiaries currently action pursuant to section 5(d)(3) of the Federal Demeet all applicable capital standards and, upon posit Insurance Act ("FDI Act") as amended by the consummation of the proposed transactions, will Financial Institutions Reform, Recovery, and Encontinue to meet all applicable capital standards; forcement Act of 1989 (Pub. L. No. 101-73, § 206, 103 (3) The transaction is not in substance the acquisi- Stat. 183, 199 (1989)). Southeast Savings is the succestion of a Bank Insurance Fund member bank by a sor to two failed savings associations. Southeast has Savings Association Insurance Fund member; operated Southeast Savings as a savings association (4) Freedom, the predecessor to NCNB Savings, since receiving Board approval to acquire the instituhad tangible capital of less than 4 percent during the tion under section 4(c)(8) of the Bank Holding Comquarter preceding its acquisition by NCNB. pany Act. 12 U.S.C. § 1843(c)(8). See Southeast (5) The transaction, which involves the purchase of Banking Corporation, 75 Federal Reserve Bulletin 92 assets and assumption of liabilities of NCNB Sav- (1989). ings, a savings association located in Florida, by a The record in this case shows that: bank subsidiary of NCNB also located in Florida, (1) The aggregate amount of the total assets of all would comply with the requirements of section 3(d) depository institution subsidiaries of Southeast is of the Bank Holding Company Act as if NCNB $15.5 billion, an amount which is not less than 200 Savings were a state bank which NCNB was applypercent of the total assets of Southeast Savings, ing to acquire. which currently has $1.3 billion in total assets; (2) Southeast and all of its bank subsidiaries cur- Based on the foregoing and all of the other facts of rently meet all applicable capital standards and, record, the Staff Director of the Division of Banking upon consummation of the proposed transaction, Supervision and Regulation and the General Counsel will continue to meet all applicable capital standards; of the Board, acting pursuant to authority delegated by (3) The transaction is not in substance the acquisithe Board of Governors, hereby approve your request tion of a Bank Insurance Fund member bank by a to engage in the proposed transaction under section Savings Association Insurance Fund member; 5(d)(3) of the FDI Act. This approval is subject to (4) The predecessor to Southeast Savings had tan- NCNB obtaining the required approval of the approgible capital of less than 4 percent during the quarter priate Federal banking agency for the proposed merger preceding their acquisition by Southeast; under the Bank Merger Act. (5) The transaction involves the merger of a savings association located in Florida into a bank Very truly yours, subsidiary of Southeast that is also located in Florida. Southeast is a bank holding company William W. Wiles whose banking subsidiaries' operations are princi- Secretary of the Board pally conducted in Florida. Accordingly, the transaction would comply with the requirements of cc: Federal Reserve Bank of Richmond section 3(d) of the Bank Holding Company Act if Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

100 Federal Reserve Bulletin • February 1990 Southeast Savings were a state bank which South- Southeast obtaining the required approval of the apeast was applying to acquire. propriate Federal banking agency for the proposed merger under the Bank Merger Act. Based on the foregoing and all of the other facts of record, the General Counsel of the Board and the Staff Very truly yours, Director of the Division of Banking Supervision and Regulation, acting pursuant to authority delegated by William W. Wiles the Board of Governors, hereby approve your request Secretary of the Board to engage in the proposed transaction under section 5(d)(3) of the FDI Act. This approval is subject to cc: Federal Reserve Bank of Atlanta APPLICATIONS APPROVED UNDER BANK HOLDING COMPANY ACT By the Secretary of the Board Recent applications have been approved by the Secretary of the Board as listed below. Copies are available upon request to the Freedom of Information Office, Office of the Secretary, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Applicant(s) Bank(s) ^^ate^ Barclays Bank PLC, Key Services Corporation, December 28, 1989 London, England Albany, New York Barclays PLC, London, England Bay banks, Inc., Boston, Massachusetts Chemical Banking Corporation, New York, New York Manufacturers Hanover Corporation, New York, New York National Westminster Bank, PLC, London, England Natwest Holdings, Inc., New York, New York Northeast Bancorp, Inc., New Haven, Connecticut The Bank of New York Company, Inc., New York, New York The Chase Manhattan Corporation, New York, New York The Hong Kong and Shanghai Banking Corporation Limited, Hong Kong, B.C.C. Kellett NV, Curacao, Netherlands Antilles HSBC Holdings BV, Amsterdam, the Netherlands Marine Midland Banks, Inc., Buffalo, New York Huntington Bancshares Incorporated, Farragut Mortgage Co., December 6, 1989 Columbus, Ohio Waltham, Massachusetts Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 101 By Federal Reserve Banks Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon request to the Reserve Banks. Section 3 Reserve Effective Applicant Bank(s) Bank date ABN-Stichting, Exchange Bancorp, Inc., Chicago December 19, 1989 Amsterdam, The Netherlands Chicago, Illinois Algemene Bank Nederland N.V., Amsterdam, The Netherlands ABN/LaSalle North America, Inc., Chicago, Illinois LaSalle National Corporation, Chicago, Illinois Alliance Bancorporation, Lisbon Bank and Trust Chicago December 14, 1989 Lisbon, Iowa Company, Lisbon, Iowa Bancommunity Service Security Shares, Inc., Minneapolis December 13, 1989 Corporation, Mankato, Minnesota St. Peter, Minnesota Bankers Corp., Bankers Savings, New York December 20, 1989 Perth Amboy, New Jersey Perth Amboy, New Jersey Broadway Bancshares of Broadway Air Force National Dallas December 1, 1989 Delaware, Inc., Bank, Wilmington, Delaware Randolph Air Force Base, Texas Broadway National Bank, San Antonio, Texas Eisenhower National Bank, San Antonio, Texas Century Financial Corporation, Century Bank and Trust, Chicago November 29, 1989 Coldwater, Michigan Coldwater, Michigan Citizens & Merchants Citizens & Merchants State Atlanta December 11, 1989 Corporation, Bank, Douglasville, Georgia Douglas ville, Georgia Citizens Corporation, Bank South, Mount Vernon, Atlanta December 1, 1989 Eastman, Georgia Mount Vernon, Georgia Country Bank Shares State Bank of Mt. Horeb, Chicago December 1, 1989 Corporation, Mt. Horeb, Wisconsin Janesville, Wisconsin State Bank of Argyle, Argyle, Wisconsin Citizens State Bank of Clinton, Clinton, Wisconsin Dakota Bankshares, Inc., Republic National Bancorp, Inc., Minneapolis December 14, 1989 Fargo, North Dakota Phoenix, Arizona DBT Holding Company, Darby Bank and Trust Company, Atlanta December 6, 1989 Vidalia, Georgia Vidalia, Georgia East Texas Financial Citizens Bank, Dallas November 27, 1989 Corporation, Kilgore, Texas Kilgore, Texas Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

102 Federal Reserve Bulletin • February 1990 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date The Estes Park Bank Restated Estes Bank Corporation, Kansas City December 6, 1989 Employee Stock Ownership Estes Park, Colorado 401(k) Plan, Estes Park, Colorado First Bank Corp., First National Bank of Fort St. Louis December 4, 1989 Fort Smith, Arkansas Smith, Fort Smith, Arkansas First Commerce Bancorp, Inc., Citizens Holding Company, Atlanta December 13, 1989 Commerce, Georgia Lexington, Georgia First Lockney Bancshares, Inc. Lockney Bancshares, Inc., Dallas December 15, 1989 Lockney, Texas Lockney, Texas First National Bank in Lockney, Lockney, Texas First Southern Bancorp, Inc., National Bank of Hustonville, Cleveland December 15, 1989 Stanford, Kentucky Hustonville, Kentucky First Sterling Bancorp, Inc., Rock Fallas Bancshares, Inc., Chicago December 6, 1989 Sterling, Illinois Rock Fallas, Illinois Fortune 44 Company, Newberry Bancorp, Inc., Minneapolis December 1, 1989 Boulder, Colorado Newberry, Michigan Fourth Financial Corporation, McPherson Bank and Trust Kansas City November 21, 1989 Wichita, Kansas Company, McPherson, Kansas Fourth Financial Corporation, Southwest Financial Corporation, Kansas City November 21, 1989 Wichita, Kansas Garden City, Kansas Greater Chicago Financial Corp. Ashland Bancshares, Inc., Chicago November 28, 1989 Chicago, Illinois Chicago, Illinois Hogue Holding Company, Inc., Bank of Weiner, St. Louis December 5, 1989 Weiner, Arkansas Weiner, Arkansas Home Credit Corporation, Home Credit Bank San Francisco December 14, 1989 Salt Lake City, Utah (In Organization), Salt Lake City, Utah L.B.T. Bancorporation, Liberty Bank & Trust, Chicago November 24, 1989 West Des Moines, Iowa Lake Mills, Iowa Lincoln Financial Corporation, Signal Bancorp, Chicago December 19, 1989 Fort Wayne, Indiana Monticello, Indiana Lincoln Holding Company, Farmers State Bank of Canton, Minneapolis December 15, 1989 Canton, South Dakota Canton, South Dakota Midland States Bancorp, Inc., Effingham State Bank, St. Louis December 8, 1989 Effingham, Illinois Effingham, Illinois Monticello Bankshares, Inc., Bank of Clinton County, St. Louis November 22, 1989 Monticello, Kentucky Albany, Kentucky Mountain Parks Financial Bank of Evergreen, Kansas City December 15, 1989 Corporation, Evergreen, Colorado Minneapolis, Minnesota Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 103 Section 3—Continued Reserve Effective Applicant Bank(s) Bank date Mountain West Banking NBR Financial, Inc., Kansas City November 28, 1989 Corporation, Boulder, Colorado Denver, Colorado City wide Bank of Thornton, Thornton, Colorado NBC Bancorporation, Central Bancorporation, Minneapolis November 29, 1989 Inc., Inc., Newport, Minnesota Newport, Minnesota Parkway Financial, Inc., Parkway Bank, Kansas City November 24, 1989 Overland Park, Kansas Overland Park, Kansas PBM Bancorp., Inc., Rend Lake Bancorp, Inc., St. Louis December 1, 1989 Marion, Illinois Marion, Illinois Pioneer Bancorp, Inc., River Associates Bancorp, Inc., Chicago December 15, 1989 Chicago, Illinois River Grove, Illinois Raymond Bancorp, Inc., Illini Bancshares, Inc., St. Louis December 11, 1989 Raymond, Illinois Girard, Illinois Republic Bancshares, Inc., Marionville Bancshares, Inc., St. Louis November 24, 1989 Neosho, Missouri Neosho, Missouri Saban S.A., Safra National Bank of New New York December 15, 1989 Panama City, Republic of York, Panama New York, New York Surety Capital Corporation, Texas National Bank Dallas November 30, 1989 Hurst, Texas of Lufkin, Lufkin, Texas Texas Security Bancshares Central Bank and Trust, Dallas December 1, 1989 Corporation, Fort Worth, Texas Dover, Delaware North Fort Worth Bank, Fort Worth, Texas Trimpe's Inc., Lisbon Bank and Chicago December 14, 1989 Lisbon, Iowa Trust Company, Lisbon, Iowa Village Bankshares, Inc., The Village Bank of Florida, Atlanta December 8, 1989 Tampa, Florida Tampa, Florida Weetamoe Bancorp, Slade's Ferry Trust Company, Boston December 1, 1989 Somerset, Massachusetts Somerset, Massachusetts West Central Banque Shares, Hancock State Bank, Minneapolis December 1, 1989 Inc., Hancock, Minnesota Hancock, Minnesota West Point Bancorp., Inc., Dakota Bancshares, Inc., Kansas City November 24, 1989 St. Joseph, Missouri St. Joseph, Missouri Section 4 Nonbanking Reserve Effective Applicant Activity/Company Bank date Donnelly Bancshares, Inc., Farmers & Merchants Insurance Minneapolis December 14, 1989 Donnelly, Minnesota Agency, Donnelly, Minnesota Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

104 Federal Reserve Bulletin • February 1990 Section 4—Continued Nonbanking Reserve Effective Applicant Activity/Company Bank date The Fuji Bank, Limited, Kleinwort Benson Government New York December 8, 1989 Tokyo,Japan Securities Inc., Chicago, Illinois Gold Coast Bancshares, Inc., Gold Coast Financial Services, Atlanta November 28, 1989 Hypoluxo, Florida Inc., Gulfstream Financial Services, Hypoluxo, Florida Inc., Hypoluxo, Florida PKbanken, Independent Finance, Inc., New York December 15, 1989 Stockholm, Sweden Bellevue, Washington PNC Financial Corp., Lomas Securities USA, Inc., Cleveland December 15, 1989 Pittsburgh, Pennsylvania Houston, Texas BHC Holdings, Philadelphia, Pennsylvania Sections 3 and 4 . .. Nonbanking Reserve Effective Activity/Company Bank date Society Corporation, Trustcorp, Inc., Cleveland December 1, 1989 Cleveland, Ohio Toledo, Ohio APPLICATIONS APPROVED UNDER BANK MERGER ACT By Federal Reserve Banks Recent applications have been approved by the Federal Reserve Banks as listed below. Copies are available upon request to the Reserve Banks. Reserve Effective Applicant Bank(s) Bank date Landmark Bank of Highland, Landmark Bank of Alton, St. Louis December 1, 1989 Highland, Illinois Alton, Illinois Landmark Bank of Madison County, Glen Carbon, Illinois Union Bank/Streator, Union Bank/Triumph, Chicago December 15, 1989 Streator, Illinois Triumph, Illinois Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 105 PENDING CASES INVOLVING THE BOARD OF Securities Industry Association v. Board of Gover- GOVERNORS nors, No. 89-1127 (D.C. Cir., filed February 16, 1989). Petition for review of Board order permitting five bank holding companies to engage to a limited This list of pending cases does not include suits extent in additional securities underwriting and dealagainst the Federal Reserve Banks in which the Board ing activities. of Governors is not named a party. American Land Title Assoc. v. Board of Governors, No. 88-1872 (D.C. Cir., filed December 16, 1988). Securities Industry Association v. Board of Gover- Petition for review of Board order ruling that exnors, No. 89-1730 (D.C. Cir., filed November 29, emption G from the section 4(c)(8) prohibition on 1989). Petition for review of Board order approving insurance activities, which grandfathers insurance application under section 4(c)(8) to engage in private agency activities by bank holding companies that placement and riskless principal activities. conducted insurance agency activities before Janu- Babcock and Brown Holdings, Inc., et al. v. Board of ary 1, 1971, does not limit those grandfathered Governors, No. 89-70518 (9th Cir., filed November activities to the specific ones undertaken at that 22, 1989). Petition for review of Board determina- time. Awaiting decision. tion that a company would control a proposed MCorp v. Board of Governors, No. CA3-88-2693 insured bank for purposes of the Bank Holding (N.D. Tex., filed October 10, 1988). Application for Company Act. injunction to set aside temporary cease and desist Consumers Union of U.S., Inc. v. Board of Gover- orders. Stayed pending outcome of MCorp v. Board nors, No. 89-3008 (D.D.C., filed November 1, of Governors in Fifth Circuit. 1989). Challenge to various aspects of Regulation Z White v. Board of Governors, No. CU-S-88-623-RDF implementing the Home Equity Loan Consumer (D. Nev., filed July 29, 1988). Age discrimination Protection Act. complaint. Synovus Financial Corp. v. Board of Governors, No. Cohen v. Board of Governors, No. 88-1061 (D.N.J., 89-1394 (D.C. Cir., filed June 21, 1989). Petition for filed March 7, 1988). Action seeking disclosure of review of Board order permitting relocation of a documents under the Freedom of Information Act. bank holding company's national bank subsidiary Chase Manhattan Corp. v. Board of Governors, No. from Alabama to Georgia. 87-1333 (D.C. Cir., filed July 20, 1987). Petition to MCorp v. Board of Governors, No. 89-2816 (5th Cir., review order conditionally approving application for filed May 2, 1989). Appeal of preliminary injunction bank holding company to underwrite and deal in against the Board enjoining pending and future mortgage-related securities to a limited extent. enforcement actions against bank holding company Stayed by stipulation pending expiration of moratonow in bankruptcy. Awaiting decision. rium or Board reconsideration. Independent Insurance Agents of America v. Board of Lewis v. Board of Governors, Nos. 87-3455, 87-3545 Governors, No. 89-4030 (2d Cir., filed March 9, (11th Cir., filed June 25, August 3, 1987). Petition for 1989). Petition for review of Board order ruling that review of Board orders approving applications of the non-banking restrictions of section 4 of the Bank non-Florida bank holding companies to expand ac- Holding Company Act apply only to non-bank sub- tivities of Florida trust company subsidiaries. Matsidiaries of bank holding companies. Petition for ter stayed pending Supreme Court review of Contireview denied November 29, 1989. Petition for nental Illinois Corp. v. Lewis, 827 F.2d 1517 (11th rehearing en banc pending. Cir. 1987). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A1 Financial and Business Statistics NOTE. The following tables may have some 3.11, 3.15-3.20, 3.22-3.25, 3.27, 3.28, and 4.30. discontinuities in historical data for some series For a more detailed explanation of the changes, beginning with the December 1989 issue: 1.12, see the announcement on page 16 of the January 1.33, 1.44, 1.52, 1.57-1.60, 2.10, 2.12, 2.13, 3.10, 1990 Bulletin. CONTENTS COMMERCIAL BANKING INSTITUTIONS All Major nondeposit funds Domestic Financial Statistics A18 Assets and liabilities, last-Wednesday-of-month series WEEKLY REPORTING COMMERCIAL BANKS MONEY STOCK AND BANK CREDIT Assets and liabilities A3 Reserves, money stock, liquid assets, and debt A19 All reporting banks measures A20 Banks in New York City A4 Reserves of depository institutions, Reserve A21 Branches and agencies of foreign banks Bank credit A22 Gross demand deposits—individuals, A5 Reserves and borrowings—Depository partnerships, and corporations institutions A6 Selected borrowings in immediately available funds—Large member banks FINANCIAL MARKETS A23 Commercial paper and bankers dollar acceptances outstanding POLICY INSTRUMENTS A23 Prime rate charged by banks on short-term A7 Federal Reserve Bank interest rates business loans A8 Reserve requirements of depository institutions A24 Interest rates—money and capital markets A25 Stock market—Selected statistics A9 Federal Reserve open market transactions A26 Selected financial institutions—Selected assets and liabilities FEDERAL RESERVE BANKS FEDERAL FINANCE A10 Condition and Federal Reserve note statements All Maturity distribution of loan and security A28 Federal fiscal and financing operations holdings A29 U.S. budget receipts and outlays A30 Federal debt subject to statutory limitation A30 Gross public debt of U.S. Treasury—Types MONETARY AND CREDIT AGGREGATES and ownership A31 U.S. government securities A12 Aggregate reserves of depository institutions dealers—Transactions and monetary base A32 U.S. government securities dealers—Positions A13 Money stock, liquid assets, and debt measures and financing A15 Bank debits and deposit turnover A33 Federal and federally sponsored credit A16 Loans and securities—All commercial banks agencies—Debt outstanding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

2 Federal Reserve Bulletin • February 1990 SECURITIES MARKETS AND A56 U.S. reserve assets CORPORATE FINANCE A56 Foreign official assets held at Federal Reserve Banks A34 New security issues—State and local A57 Foreign branches of U.S. banks—Balance governments and corporations sheet data A35 Open-end investment companies—Net sales A59 Selected U.S. liabilities to foreign official and asset position institutions A35 Corporate profits and their distribution A35 Total nonfarm business expenditures on new plant and equipment REPORTED BY BANKS IN THE UNITED STATES A36 Domestic finance companies—Assets and liabilities and business credit A59 Liabilities to and claims on foreigners A60 Liabilities to foreigners A62 Banks' own claims on foreigners REAL ESTATE A63 Banks' own and domestic customers' claims on A37 Mortgage markets foreigners A38 Mortgage debt outstanding A63 Banks' own claims on unaffiliated foreigners A64 Claims on foreign countries—Combined domestic offices and foreign branches CONSUMER INSTALLMENT CREDIT A39 Total outstanding and net change A40 Terms REPORTED BY NONBANKING BUSINESS ENTERPRISES IN THE UNITED STATES FLOW OF FUNDS A65 Liabilities to unaffiliated foreigners A41 Funds raised in U.S. credit markets A66 Claims on unaffiliated foreigners A43 Direct and indirect sources of funds to credit markets A44 Summary of credit market debt outstanding SECURITIES HOLDINGS AND TRANSACTIONS A45 Summary of credit market claims, by holder A67 Foreign transactions in securities A68 Marketable U.S. Treasury bonds and Domestic Nonfinancial Statistics notes—Foreign transactions SELECTED MEASURES A46 Nonfinancial business activity—Selected INTEREST AND EXCHANGE RATES measures A69 Discount rates of foreign central banks A47 Labor force, employment, and unemployment A69 Foreign short-term interest rates A48 Output, capacity, and capacity utilization A70 Foreign exchange rates A49 Industrial production—Indexes and gross value A51 Housing and construction A71 Guide to Tabular Presentation, A52 Consumer and producer prices Statistical Releases, and Special A53 Gross national product and income Tables A54 Personal income and saving International Statistics SPECIAL TABLES A72 Assets and liabilities of commercial banks, SUMMARY STATISTICS September 30, 1989 A55 U.S. international transactions—Summary A78 Pro forma balance sheet and income statement A56 U.S. foreign trade for priced service operations, June 30, 1989 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 Annual rates of change, seasonally adjusted in percent1 1988 1989 1989 MMoonneettaarryy aanndd ccrreeddiitt aaggggrreeggaatteess Q4 Ql Q2 Q3 July Aug. Sept.' Oct. Nov. Reserves of depository institutions2 1 Total -.8 -4.2 -8.7 .3 7.2 1.1 9.6 8.1 -1.1 2 Required -1.5 -4.4 -7.6 .1 6.0 2.8 8.6 6.5 .4 3 Nonborrowed 5.3 .0 -10.2 8.3 24.2 1.5 9.3 11.0 3.1 4 Monetary base 4.8 4.6 1.5 2.9r 4.r \.2r 7.5 2.8 1.3 Concepts of money, liquid assets, and debt4 5 Ml 2.3 -.4 -5.6 1.5 lo.y .3' 5.8 10.1 3.4 6 M2 3.6 l.y 1.2 7.3 11.5' i.y 7.4 7.8' 8.4 7 M3 4.8 3.7 2.9 4.6 8.8' 1.9' .9 4.5 6.0 8 L 5.5 5.0 4.7 4.9 8.7 4.9 3.0 7.0 n.a. 9 Debt 8.9 8.4 7.9' 7.2' 6.4r 8.1r 7.1 8.3 n.a. Nontrgnsaction components 10 In M25 4.1 2.6 3.5 9.2' 11.7 9.7 8.0 7.1' 10.1 11 In M3 only6 9.3 10.6 9.2 -4.9 -.6 -17.0 -22.4 -7.9' -3.1 Time and savings deposits Commercial banks 12 Savings" 4.0 -3.7 -14.2 -.2 3.3 7.3 7.9 5.9' 13.8 13 Small-denomination time 18.0 22.5 29.0 10.4 i.y 7.5 3.9 13.C 5.6 14 Large-denomination time ' 13.0 18.1 17.7 1.9 3.9 -2.1 -3.5 6.2' 8.2 Thrift institutions 15 Savings -2.5 -7.7 -19.0 -6.7 -5.4 " -1.8 4.0 3.5' 7.8 16 Small-denomination time 6.6 4.3 14.0 9.8 9.2 5.2 -2.9 -11.7' -5.7 17 Large-denomination time 8.0 1.2 5.9 -9.6 -8.3 -22.5 -29.4 -34.4' -27.1 Debt components4 18 Federal 7.6 7.7 6.9 4.6' -.2' 8.8' 11.0 9.8 n.a. 19 Nonfederal 9.2 8.6 8.2' 8.0' 8.4 8.0' 5.9 7.8 n.a. 1. Unless otherwise noted, rates of change are calculated from average institutions and money market funds. Also excludes all balances held by U.S. amounts outstanding in preceding month or quarter. commercial banks, money market funds (general purpose and broker-dealer), 2. Figures incorporate adjustments for discontinuities associated with the foreign governments and commercial banks, and the U.S. government. implementation of the Monetary Control Act and other regulatory changes to M3: M2 plus large-denomination time deposits and term RP liabilities (in reserve requirements. To adjust for discontinuities due to changes in reserve amounts of $100,000 or more) issued by commercial banks and thrift institutions, requirements on reservable nondeposit liabilities, the sum of such required term Eurodollars held by U.S. residents at foreign branches of U.S. banks reserves is subtracted from the actual series. Similarly, in adjusting for discon- worldwide and at all banking offices in the United Kingdom and Canada, and tinuities in the monetary base, required clearing balances and adjustments to balances in both taxable and tax-exempt, institution-only money market mutual compensate for float also are subtracted from the actual series. funds. Excludes amounts held by depository institutions, the U.S. government, 3. The monetary base not adjusted for discontinuities consists of total money market funds, and foreign banks and official institutions. Also subtracted reserves plus required clearing balances and adjustments to compensate for float is the estimated amount of overnight RPs and Eurodollars held by institution-only at Federal Reserve Banks plus the currency component of the money stock less money market mutual funds. the amount of vault cash holdings of thrift institutions that is included in the L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term currency component of the money stock plus, for institutions not having required Treasury securities, commercial paper and bankers acceptances, net of money reserve balances, the excess of current vault cash over the amount applied to market mutual fund holdings of these assets. satisfy current reserve requirements. After the introduction of contemporaneous Debt: Debt of domestic nonfinancial sectors consists of outstanding credit reserve requirements (CRR), currency and vault cash figures are measured over market debt of the U.S. government, state and local governments, and private the weekly computation period ending Monday. nonfinancial sectors. Private debt consists of corporate bonds, mortgages, con- Before CRR, all components of the monetary base other than excess reserves sumer credit (including bank loans), other bank loans, commercial paper, bankers are seasonally adjusted as a whole, rather than by component, and excess acceptances, and other debt instruments. The source of data on domestic reserves are added on a not seasonally adjusted basis. After CRR, the seasonally nonfinancial debt is the Federal Reserve Board's flow of funds accounts. Debt adjusted series consists of seasonally adjusted total reserves, which include data are based on monthly averages. Growth rates for debt reflect adjustments for excess reserves on a not seasonally adjusted basis, plus the seasonally adjusted discontinuities over time in the levels of debt presented in other tables. currency component of the money stock plus the remaining items seasonally 5. Sum of overnight RPs and Eurodollars, money market fund balances adjusted as a whole. (general purpose and broker-dealer), MMDAs, and savings and small time 4. Composition of the money stock measures and debt is as follows: deposits less the estimated amount of demand deposits and vault cash held by Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults thrift institutions to service their time and savings deposit liabilities. of depository institutions; (2) travelers checks of nonbank issuers; (3) demand 6. Sum of large time deposits, term RPs, and Eurodollars of U.S. residents, deposits at all commercial banks other than those due to depository institutions, money market fund balances (institution-only), less a consolidation adjustment the U.S. government, and foreign banks and official institutions less cash items in that represents the estimated amount of overnight RPs and Eurodollars held by the process of collection and Federal Reserve float; and (4) other checkable institution-only money market mutual funds. deposits (OCD) consisting of negotiable order of withdrawal (NOW) and auto- 7. Excludes MMDAs. matic transfer service (ATS) accounts at depository institutions, credit union 8. Small-denomination time deposits—including retail RPs—-are those issued share draft accounts, and demand deposits at thrift institutions. in amounts of less than $100,000. All IRA and Keogh accounts at commercial M2: Ml plus overnight (and continuing contract) repurchase agreements (RPs) banks and thrifts are subtracted from small time deposits. issued by all commercial banks and overnight Eurodollars issued to U.S. residents 9. Large-denomination time deposits are those issued in amounts of $100,000 by foreign branches of U.S. banks worldwide, Money Market Deposit Accounts or more, excluding those booked at international banking facilities. (MMDAs), savings and small-denomination time deposits (time deposits—includ- 10. Large-denomination time deposits at commercial banks less those held by ing retail RPs—in amounts of less than $100,000), and balances in both taxable and money market mutual funds, depository institutions, and foreign banks and tax-exempt general purpose and broker-dealer money market mutual funds. officiaJ institutions. Excludes individual retirement accounts (IRA) and Keogh balances at depository Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A4 Domestic Nonfinancial Statistics • February 1990 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 Factors 1989 1989 Sept. Oct. Nov. Oct. 18 Oct. 25 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 SUPPLYING RESERVE FUNDS 1 Reserve Bank credit 261,299 260,634 265,521 261,148 258,069 260,511 262,676 261,218 261,012 264,506 2 U.S. government securities1 219,475 215,920 217,455 216,270 212,859 214,962 216,751 214,890 217,268 220,059 4 3 H Bo el u d g h u t n d o e u r t r r ig e h p t u rchase agreements 219, 4 0 5 1 7 8 215,920 0 216,4 9 7 8 5 0 216,270 0 212,859 0 214,962 0 216,751 0 214,890 0 216,8 3 7 9 2 6 21 3 6 , , 8 2 0 5 5 4 5 Federal agency obligations 6,762 6,546 6,602 6,555 6,542 6,525 6,525 6,525 6,536 6,845 6 7 8 Ac B H c o e e u l p d g t a h u n t n c o d e u e s r t ri r g e h p t u rchase agreements 6,5 2 6 0 2 0 0 6,546 0 0 6,52 7 5 7 0 6,555 0 0 6,542 0 0 6,525 0 0 6,525 0 0 6,525 0 0 6,52 1 5 01 6,5 3 2 2 5 0 0 9 Loans 636 608 346 488 376 314 205 341 202 680 10 Float 879 734 1,024 898 873 697 1,209 1,197 858 981 11 Other Federal Reserve assets 33,546 36,825 37,093 36,936 37,420 38,014 37,988 38,265 36,148 35,941 12 Gold stock2 11,066 11,064 11,062 11,063 11,063 11,063 11,063 11,062 11,061 11,060 13 Special drawing rights certificate account.. 8,518 8,518 8,518 8,518 8,518 8,518 8,518 8,518 8,518 8,518 14 Treasury currency outstanding 19,391 19,462 19,529 19,446 19,467 19,481 19,508 19,522 19,536 19,550 ABSORBING RESERVE FUNDS 1 1 6 5 T C r u e r a r s e u n r c y y c i a n sh c ir h c o u l l d a i t n io g n s 2 248,9 43 3 1 7 249,1 4 9 3 0 9 251,8 4 0 4 7 8 249,8 4 0 3 2 9 249,2 4 4 3 4 9 248,7 4 7 4 9 2 250,1 4 3 4 0 4 251,3 4 3 4 8 9 252,1 45 5 1 8 253,6 4 4 4 1 8 Deposits, other than reserve balances, with Federal Reserve Banks 17 Treasury 7,679 6,111 5,008 6,154 5,389 6,436 5,361 4,757 4,449 5,093 18 Foreign 257 245 234 260 221 219 223 213 239 253 19 Service-related balances and adjustments 1,846 1,866 1,944 1,815 1,817 1,721 1,984 1,880 1,984 1,966 20 Other 351 327 333 247 332 492 329 248 293 457 21 Other Federal Reserve liabilities and capital 7,572 8,091 7,862 7,825 7,654 7,891 8,078 7,716 7,651 7,912 22 Reserve balances with Federal Reserve Banks 33,201 33,410 33,993 33,634 32,022 33,592 35,216 33,717 32,903 33,866 End-of-month figures Wednesday figures 1989 1989 Sept. Oct. Nov. Oct. 18 Oct. 25 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 SUPPLYING RESERVE FUNDS 23 Reserve Bank credit 264,137 264,717 267,060 265,872 257,290 263,464 262,938 261,062 263,150 275,731 24 U.S. government securities1 221,051 218,176 223,142 218,961 211,871 217,752 216,595 216,088 219,406 228,898 2 2 5 6 B H o e u ld g h u t n o d u er t ri r g e h p t u rchase agreements. 221,051 0 218,176 0 223,142 0 218,961 0 211,871 0 217,752 0 216,595 0 216,0880 21 2 6 , , 7 63 7 3 3 21 1 6 2 , , 6 2 7 2 2 6 27 Federal agency obligations 6,555 6,525 6,525 6,555 6,525 6,525 6,525 6,525 6,599 7,689 2 3 2 9 0 8 Ac H B c e e o l p u d t g a h u n t n c d o e e u s r t r r ig ep ht u rchase agreements 6,555 0 0 6,52 0 5 0 6,525 0 0 6,555 0 0 6,525 0 0 6,525 0 0 6,525 0 0 6,525 0 0 6,52 7 5 0 4 6 1 , , 5 1 2 6 5 4 0 31 Loans 598 270 181 402 397 231 177 1,329 170 1,225 32 Float 501 1,471 668 2,218 622 707 1,083 563 890 1,022 33 Other Federal Reserve assets 35,433 38,275 36,544 37,736 37,876 38,249 38,558 36,556 36,086 36,898 34 Gold stock2 11,065 11,062 11,060 11,063 11,063 11,062 11,062 11,062 11,061 11,060 35 Special drawing rights certificate account.. 8,518 8,518 8,518 8,518 8,518 8,518 8,518 8,518 8,518 8,518 36 Treasury currency outstanding 19,425 19,494 19,564 19,446 19,467 19,481 19,508 19,522 19,536 19,550 ABSORBING RESERVE FUNDS 37 Currency in circulation 247,581 249,025 253,960 249,600 248,954 249,383 250,875 251,555 253,389 253,928 38 Treasury cash holdings2 440 444 445 438 442 442 449 452 447 448 Deposits, other than reserve balances, with Federal Reserve Banks 39 Treasury 13,452 13,124 5,500 6,138 5,827 7,133 5,949 6,637 4,504 6,470 40 Foreign 326 252 307 217 214 226 190 277 244 185 41 Service-related balances and adjustments 1,630 1,623 1,638 1,625 1,623 1,623 1,637 1,636 1,639 1,639 42 Other 318 292 311 277 810 392 228 301 232 949 43 Other Federal Reserve liabilities and capital 8,776 8,303 8,402 7,612 7,450 7,962 7,615 7,405 7,572 7,855 44 Reserve balances with Federal Reserve Banks3 30,623 30,728 35,639 38,993 31,019 35,366 35,083 31,901 34,238 43,385 1. Includes securities loaned—fully guaranteed by U.S. government securities Research and Statistics, Banking Section. pledged with Federal Reserve Banks—and excludes any securities sold and 3. Excludes required clearing balances and adjustments to compensate for scheduled to be bought back under matched sale-purchase transactions. float. 2. Revised for periods between October 1986 and April 1987. At times during NOTE. For amounts of currency and coin held as reserves, see table 1.12. this interval, outstanding gold certificates were inadvertently in excess of the gold Components may not add to totals because of rounding. stock. Revised data not included in this table are available from the Division of 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 Institutions1 Millions of dollars Monthly averages9 Reserve classification Dec. Dec. Dec. May July Aug. Sept. Oct. 1 Reserve balances with Reserve Banks2 37,360 37,673 37,830 33,199 33,852 33,902 32,823 33,556 33,123 33,942 2 Total vault cash3 24,077 26,185 27,197 27,166 27,151 27,851 28,358 28,085 28,900 28,519 3 Vault"' 22,199 24,449 25,909 25,712 25,735 26,351 26,735 26,570 27,275' 27,048 4 Surplus 1,878 1,736 1,288 1,454 1,416 1,500 1,622 1,515 1,625' 1,471 5 Total reserves6 59,560 62,123 63,739 58,911 59,587 60,254 59,559 60,126 60,397 60,989 6 Required reserves 58,191 61,094 62,699 57,881 58,681 59,288 58,674 59,188 59,378' 60,044 7 Excess reserve balances at Reserve Banks 1,369 1,029 1,040 1,031 905 966 885 938 1,020 945 8 Total borrowings at Reserve Banks 827 777 1,716 1,720 1,490 694 675 693 555 349 9 Seasonal borrowings at Reserve Banks .. 38 93 130 345 431 497 490 452 330 134 10 Extended credit at Reserve Banks 303 483 1,244 1,197 917 106 41 22 21 21 Biweekly averages of daily figures for weeks ending 1989 Aug. 23 Sept. 6 Sept. 20 Oct. 4 Oct. 18 Nov. r Nov. 15r Nov. 29 Dec. 13 Dec. 27 11 Reserve balances with Reserve Banks2 32,599 33,053 34,424 32,643 33,581 32,778 34,468 33,394 35,399 35,140 12 Total vault cash 28,852 27,710 28,095 28,298 29,096 28,875 27,907 29,156 27,821 29,415 n Vault4 27,212 26,153 26,660 26,695 27,531 27,177 26,552 27,574 26,509 27,900 14 Surplus 1,640 1,557 1,436 1,603 1,565 1,698 1,355 1,582 1,312 1,516 15 Total reserves6 59,810 59,206 61,083 59,338 61,112 59,955 61,020 60,968 61,908 63,040 16 Required reserves ^ 58,859 58,247 60,195 58,343 60,186 58,827 60,139 59,958 61,149 62,002 17 Excess reserve balances at Reserve Banks 951 959 888 995' 926 1,128 881 1,009 759 1,037 18 Total borrowings at Reserve Banks 753 538 614 898 653 345 272 441 151 351 19 Seasonal borrowings at Reserve Banks 489 485 438 453 342 280 147 115 87 89 20 Extended credit at Reserve Banks 44 22 21 25 19 23 20 23 22 19 1. These data also appear in the Board's H.3 (502) release. For address, see in- with Federal Reserve Banks, which exclude required clearing balances and side front cover. adjustments to compensate for float, plus vault cash used to satisfy reserve 2. Excludes required clearing balances and adjustments to compensate for requirements. Such vault cash consists of all vault cash held during the lagged float. computation period by institutions having required reserve balances at Federal 3. Dates refer to the maintenance periods in which the vault cash can be used Reserve Banks plus the amount of vault cash equal to required reserves during the to satisfy reserve requirements. Under contemporaneous reserve requirements, maintenance period at institutions having no required reserve balances. maintenance periods end 30 days after the lagged computation periods in which 7. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy the balances are held. reserve requirements less required reserves. 4. Equal to all vault cash held during the lagged computation period by 8. Extended credit consists of borrowing at the discount window under the institutions having required reserve balances at Federal Reserve Banks plus the terms and conditions established for the extended credit program to help amount of vault cash equal to required reserves during the maintenance period at depository institutions deal with sustained liquidity pressures. Because there is institutions having no required reserve balances. not the same need to repay such borrowing promptly as there is with traditional 5. Total vault cash at institutions having no required reserve balances less the short-term adjustment credit, the money market impact of extended credit is amount of vault cash equal to their required reserves during the maintenance similar to that of nonborrowed reserves. period. 9. Data are prorated monthly averages of biweekly averages. 6. Total reserves not adjusted for discontinuities consist of reserve balances Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A6 Domestic Nonfinancial Statistics • February 1990 1.13 SELECTED BORROWINGS IN IMMEDIATELY AVAILABLE FUNDS Large Member Banks1 Averages of daily figures, in millions of dollars 1988 and 1989 week ending Monday Maturity and source Nov. 28 Dec. 5 Dec. 12 Dec. 19 Dec. 26 Federal funds purchased, repurchase agreements, and other selected borrowing in immediately available funds From commercial banks in the United States 1 For one day or under continuing contract 73,925 73,746 68,346 74,471 70,886 69,448 70,964 67,427 2 For all other maturities 11,130 9,815 11,332 9,940 9,829 10,114 9,810 9,356 From other depository institutions, foreign banks and foreign official institutions, and U.S. government agencies 3 For one day or under continuing contract 30,192' 30,73c 27,591r 28,709 30,368 26,454 24,933 22,855 4 For all other maturities 6,304r 5,929^ 7,749r 6,545 7,418 7,778 8,730 7,709 Repurchase agreements on U.S. government and federal agency securities in immediately available funds Brokers and nonbank dealers in securities 5 For one day or under continuing contract 12,595 15,950 13,810 14,929 15,392 14,634 13,043 12,610 6 For all other maturities 13,485 11,758 12,474 10,352 10,890 10,659 11,003 8,252 All other customers 7 For one day or under continuing contract 27,613 30,296 25,402 30,312 30,307 29,321 27,986 27,418 8 For all other maturities 10,962 10,845 15,064 9,790 9,651 9,790 10,860 9,248 MEMO: Federal funds loans and resale agreements in immediately available funds in maturities of one day or under continuing contract 9 To commercial banks in the United States 35,279 34,268 34,582 39,202 35,912 39,237 40,080 38,015 10 To all other specified customers 12,805 12,408 11,810 13,277 13,936 14,108 14,987 12,747 1. Banks with assets of $1 billion or more as of Dec. 31, 1977. 2. Brokers and nonbank dealers in securities; other depository institutions; These data also appear in the Board's H.5 (507) release. For address, see inside foreign banks and official institutions; and United States government agencies, front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A7 1.14 FEDERAL RESERVE BANK INTEREST RATES Percent per year Current and previous levels AAddjjuussttmmeenntt ccrreeddiitt Extended credit2 aanndd FFFeeedddeeerrraaalll RRReeessseeerrrvvveee SSeeaassoonnaall ccrreeddiitt11 First 30 days of borrowing After 30 days of borrowing3 BBBaaannnkkk 12/ O 28 n / 89 Eff d e a c te ti ve Pre ra v t i e o us 12/ O 28 n / 89 Efi d f a ec te t ive Pre r v at i e o us 12/ O 28 n / 89 Ef d fe a c te ti ve Pre r v at i e o us Effective date Boston 7 2/24/89 6 W 7 2/24/89 6W 8.90 12/28/89 8.90 12/14/89 New York 2/24/89 2/24/89 12/28/89 12/14/89 Philadelphia 2/24/89 2/24/89 12/28/89 12/14/89 Cleveland 2/24/89 2/24/89 12/28/89 12/14/89 Richmond 2/24/89 2/24/89 12/28/89 12/14/89 Atlanta 2/24/89 2/24/89 12/28/89 12/14/89 Chicago 2/24/89 2/24/89 12/28/89 12/14/89 St. Louis 2/24/89 2/24/89 12/28/89 12/14/89 Minneapolis 2/24/89 2/24/89 12/28/89 12/14/89 Kansas City 2/24/89 2/24/89 12/28/89 12/14/89 Dallas 2/27/89 2/27/89 12/28/89 12/14/89 San Francisco ... 7 2/24/89 6 W 7 2/24/89 6W 8.90 12/28/89 8.90 12/14/89 Range of rates for adjustment credit in recent years4 Range (or F.R. Range (or F.R. Range (or level)— Bank level)— Bank level)— Efifective date All F.R. of Effective All F.R. of Efifective date All F.R. Banks N.Y. Banks N.Y. Banks I 1 n 9 7 e 8 ff — ec J t a D n. e c. 9 3 1, 1977. 6-6 6 W 6m 6 V l 1980---JJuullyy 7 7 8 9 10 1 - 0 1 1 1 1 0 0 1984—Apr. 1 9 3 8W 9 -9 9 9 20 6W 1 Sept. 76 11 11 Nov. 21 8W-9 8W May 11 6W-7 Nov. 17 12 12 26 8W 8W 12 1-7l Vi. i7v * Dec. 5 12-13 13 Dec. 24 8 8 July 1 3 0 IV* IV4 1981-——MMaayy 5 13-14 14 1985—May 20 7W-8 IVi A S O e u c p t g . t . . 2 2 1 2 1 6 8 7 -8 3 8 / W 4 7 8 8 3 V /4 l NNoovv.. 6 87 13 1 1 - 4 3 1 4 1 1 1 4 3 3 1986—Mar. 2 7 4 7 7 -7 W W 7 7 W 20 sw 98WV i Dec. 4 12 12 10 7 7 Nov. 1 8W-9W Vi Apr. 21 6W-7 6W 3 9 W 9 1982---JJuullyy 70 . 11 W-12 11W July 11 6 6 1979—July 20 10 10 Aug. 737 11 1 - 1 1 W 11 /! 1 1 1 1 W Aug. 2 2 1 2 5 5 W W -6 5 5 W W A Se u p g t . . 2 1 1 0 9 7 1 1 0 0 l - W o 1 w 0 -1 W 1 l l 1 o o 1 w w 71 3 61 10 1 - 0 1 1 1 0 W W 1 1101 0 W 1987—Sept. 1 4 1 5W 6 -6 6 6 21 11 11 30 . . 10 10 Oct. 8 11-12 12 Oct. 17 9W-10 9W 1988—Aug. 9 6-6W 6W 10 12 12 13 9W 9W 11 6W 6W Nov. ?? 9-9W 9 1980—Feb. 15 12-13 13 76 9 9 1989—Feb. 24 6W-7 7 May 2 1 9 9 12 1 - 3 1 3 1 1 3 3 Dec. 1 1 5 4 8 $ ' 1 /2 /2 - - 9 9 m 9 27 7 7 30 12 12 17 8W 8 W In effect Dec. 28, 1989. 7 7 June 13 11-12 11 16 11 11 1. Adjustment credit is available on a short-term basis to help depository in no case will the rate charged be less than the basic discount rate plus 50 basis institutions meet temporary needs for funds that cannot be met through reason- points. The flexible rate is reestablished on the first business day of each able alternative sources. After May 19, 1986, the highest rate established for loans two-week reserve maintenance period. At the discretion of the Federal Reserve to depository institutions may be charged on adjustment credit loans of unusual Bank, the time period for which the basic discount rate is applied may be size that result from a major operating problem at the borrower's facility. shortened. Seasonal credit is available to help smaller depository institutions meet regular, 4. For earlier data, see the following publications of the Board of Governors: seasonal needs for funds that cannot be met through special industry lenders and Banking and Monetary Statistics, 1914-1941, and 1941-1970; Annual Statistical that arise from a combination of expected patterns of movement in their deposits Digest, 1970-1979. and loans. A temporary simplified seasonal program was established on Mar. 8, In 1980 and 1981, the Federal Reserve applied a surcharge to short-term 1985, and the interest rate was a fixed rate W percent above the rate on adjustment adjustment credit borrowings by institutions with deposits of $500 million or more credit. The program was reestablished for 1986 and 1987 but was not renewed for that had borrowed in successive weeks or in more than four weeks in a calendar 1988. quarter. A 3 percent surcharge was in effect from Mar. 17, 1980 through May 7, 2. Extended credit is available to depository institutions, when similar assist- 1980. There was no surcharge until Nov. 17, 1980, when a 2 percent surcharge was ance is not reasonably available from other sources, when exceptional circum- adopted; the surcharge was subsequently raised to 3 percent on Dec. 5, 1980, and stances or practices involve only a particular institution or when an institution is to 4 percent on May 5, 1981. The surcharge was reduced to 3 percent effective experiencing difficulties adjusting to changing market conditions over a longer Sept. 22, 1981, and to 2 percent effective Oct. 12, 1981. As of Oct. 1, 1981 the period of time. formula for applying the surcharge was changed from a calendar quarter to a 3. For extended-credit loans outstanding more than 30 days, a flexible rate moving 13-week period. The surcharge was eliminated on Nov. 17, 1981. somewhat above rates on market sources of funds ordinarily will be charged, but Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 Domestic Nonfinancial Statistics • February 1990 1.15 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS1 Percent of deposits Depository institution requirements after implementation of the Type of deposit, ai Monetary Control Act deposit interval Effective date Net transaction accounts $0 million-$40.4 million.... 12/19/89 More than $40.4 million ... 12/19/89 Nonpersonal time deposits* By original maturity Less than 1 Vi years 10/6/83 1 Vi years or more 10/6/83 Eurocurrency liabilities All types 1. Reserve requirements in effect on Dec. 31, 1989. Required reserves must be other transaction accounts, the exemption applies only to such accounts that held in the form of deposits with Federal Reserve Banks or vault cash. Nonmem- would be subject to a 3 percent reserve requirement. ber institutions may maintain reserve balances with a Federal Reserve Bank 3. Transaction accounts include all deposits on which the account holder is indirectly on a pass-through basis with certain approved institutions. For previous permitted to make withdrawals by negotiable or transferable instruments, payreserve requirements, see earlier editions of the Annual Report or the Federal ment orders of withdrawal, and telephone and preauthorized transfers in excess of Reserve Bulletin. Under provisions of the Monetary Control Act, depository three per month for the purpose of making payments to third persons or others. institutions include commercial banks, mutual savings banks, savings and loan However, MMDAs and similar accounts subject to the rules that permit no more associations, credit unions, agencies and branches of foreign banks, and Edge than six preauthorized, automatic, or other transfers per month, of which no more corporations. than three can be checks, are not transaction accounts (such accounts are savings 2. The Garn-St Germain Depository Institutions Act of 1982 (Public Law deposits subject to time deposit reserve requirements). 97-320) requires that $2 million of reservable liabilities (transaction accounts, 4. The Monetary Control Act of 1980 requires that the amount of transaction nonpersonal time deposits, and Eurocurrency liabilities) of each depository accounts against which the 3 percent reserve requirement applies be modified institution be subject to a zero percent reserve requirement. The Board is to adjust annually by 80 percent of the percentage change in transaction accounts held by the amount of reservable liabilities subject to this zero percent reserve require- all depository institutions, determined as of June 30 each year. Effective Dec. 19, ment each year for the succeeding calendar year by 80 percent of the percentage 1989 for institutions reporting quarterly and Dec. 26, 1989 for institutions increase in the total reservable liabilities of all depository institutions, measured reporting weekly, the amount was decreased from $41.5 million to $40.4 million. on an annual basis as of June 30. No corresponding adjustment is to be made in 5. In general, nonpersonal time deposits are time deposits, including savings the event of a decrease. On Dec. 20, 1988, the exemption was raised from $3.2 deposits, that are not transaction accounts and in which a beneficial interest is million to $3.4 million. In determining the reserve requirements of depository held by a depositor that is not a natural person. Also included are certain institutions, the exemption shall apply in the following order: (1) net NOW transferable time deposits held by natural persons and certain obligations issued accounts (NOW accounts less allowable deductions); (2) net other transaction to depository institution offices located outside the United States. For details, see accounts; and (3) nonpersonal time deposits or Eurocurrency liabilities starting section 204.2 of Regulation D. with those with the highest reserve ratio. With respect to NOW accounts and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A9 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS1 Millions of dollars 1989 TTyyppee ooff ttrraannssaaccttiioonn 11998866 11998877 11998888 Apr. May June July Aug. Sept. Oct. U.S. TREASURY SECURITIES Outright transactions (excluding matched transactions) Treasury bills 1 Gross purchases 22,604 18,983 8,223 3,077 311 0 0 0 0 219 2 Gross sales 2,502 6,051 587 0 321 571 5,517 934 0 1,633 3 Exchange 0 0 0 0 0 0 0 0 0 0 4 Redemptions 1,000 9,029 2,200 0 1,200 1,200 2,400 800 0 1,400 Others within 1 year 5 Gross purchases 190 3,659 2,176 172 0 0 0 0 0 0 6 Gross sales 0 300 0 0 0 0 0 0 0 0 7 Maturity shift 18,674 21,504 23,854 1,657 2,863 1,828 1,749 4,200 1,832 852 8 Exchange -20,180 -20,388 -24,588 -110 -3,628 -1,434 -1,073 -4,025 0 -2,678 9 Redemptions 0 70 0 0 0 0 0 0 0 500 1 to 5 years 10 Gross purchases 893 10,231 5,485 1,436 0 0 0 0 0 0 11 Gross sales 0 452 800 0 75 0 13 150 0 24 12 Maturity shift -17,058 -17,975 -17,720 -1,532 -2,036 -1,828 -1,584 -3,321 -1,832 -758 13 Exchange 16,985 18,938 22,515 0 3,328 1,434 787 3,425 0 2,552 5 to 10 years 14 Gross purchases 236 2,441 1,579 287 0 0 0 0 0 0 15 Gross sales 0 0 175 0 0 0 9 0 0 0 16 Maturity shift -1,620 -3,529 -5,946 -125 258 0 -165 -879 0 -95 17 Exchange 2,050 950 1,797 110 200 0 286 400 0 126 Over 10 years 18 Gross purchases 158 1,858 1,398 284 0 0 0 0 0 0 19 Gross sales 0 0 0 0 0 0 0 0 0 0 20 Maturity shift 0 0 -188 0 -1,086 0 0 0 0 0 21 Exchange 1,150 500 275 0 100 0 0 200 0 0 All maturities 22 Gross purchases 24,081 37,170 18,863 5,255 311 0 0 0 0 219 23 Gross sales 2,502 6,803 1,562 0 3% 571 5,539 1,084 0 1,657 24 Redemptions 1,000 9,099 2,200 0 1,200 1,200 2,400 800 0 1,900 Matched transactions 25 Gross sales 927,999 950,923 1,168,484 77,349 123,029 128,139 123,373 146,611 116,502 111,430 26 Gross purchases 927,247 950,935 1,168,142 78,259 113,041 138,141 118,221 147,228 120,144 111,893 Repurchase agreements2 27 Gross purchases 170,431 314,621 152,613 22,244 31,419 6,203 4,961 0 9,396 0 28 Gross sales 160,268 324,666 151,497 12,547 41,117 6,203 4,961 0 9,396 0 29 Net change in U.S. government securities 29,988 11,234 15,872 15,863 -20,971 8,232 -13,091 -1,267 3,642 -2,875 FEDERAL AGENCY OBLIGATIONS Outright transactions 30 Gross purchases 0 0 0 0 0 0 0 0 0 0 31 Gross sales 0 0 0 0 0 0 0 0 0 0 32 Redemptions 398 276 587 125 0 0 45 0 54 30 Repurchase agreements2 33 Gross purchases 31,142 80,353 57,259 7,207 12,732 1,666 1,137 0 4,011 00 34 Gross sales 30,521 81,350 56,471 3,366 16,573 1,666 1,137 0 4,011 0 35 Net change in federal agency obligations 222 -1,274 198 3,716 -3,841 0 -45 0 -54 -30 36 Total net change in System Open Market Account 30,212 9,961 16,070 19,579 -24,812 8,032 -13,136 -1,267 3,588 --22,,990055 1. Sales, redemptions, and negative figures reduce holdings of the System Open 2. In July 1984 the Open Market Trading Desk discontinued accepting bankers Market Account; all other figures increase such holdings. Details may not add to acceptances in repurchase agreements, totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 Domestic Nonfinancial Statistics • February 1990 1.18 FEDERAL RESERVE BANKS Condition and Federal Reserve Note Statements1 Millions of dollars Wednesday End of month AAAccccccooouuunnnttt 1989 1989 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Sept. Oct. Nov. Consolidated condition statement ASSETS 1 Gold certificate account 11,062 11,062 11,062 11,061 11,060 11,065 11,062 11,060 2 Special drawing rights certificate account 8,518 8,518 8,518 8,518 8,518 8,518 8,518 8,518 J 492 496 493 485 473 480 492 465 Loans 4 To depository institutions 231 177 1,330 169 1,225 598 270 182 5 Other 0 0 0 0 0 0 0 0 6 Acceptances held under repurchase agreements 0 0 0 0 0 0 0 0 Federal agency obligations 7 Bought outright 6,525 6,525 6,525 6,525 6,525 6,555 6,525 6,525 8 Held under repurchase agreements 0 0 0 74 11,,116644 0 0 0 U.S. Treasury securities Bought outright 9 Bills 95,713 94,555 94,049 94,438 94,477 98,487 96,136 100,947 10 Notes 91,426 91,426 91,226 91,381 91,381 91,950 91,426 91,381 11 Bonds 30,614 30,614 30,814 30,814 30,814 30,614 30,614 30,814 12 Total bought outright 217,752 216,595 216,088 216,633 216,672 221,051 218,176 223,142 13 Held under repurchase agreements 0 0 0 2,773 12,226 0 0 0 14 Total U.S. Treasury securities 217,752 216,595 216,088 219,405 228,897 221,051 218,176 223,142 15 Total loans and securities 224,508 223,297 223,943 226,174 237,812 228,203 224,971 229,848 16 Items in process of collection 6,938 6,784 6,732 7,065 6,275 6,909 10,120 6,103 17 Bank premises 775 776 778 778 776 775 775 776 Other assets 18 Denominated in foreign currencies3 28,954 28,962 28,982 29,075 29,075 26,411 28,953 29,593 19 All other 8,520 8,820 6,7% 6,233 7,047 8,247 8,548 6,175 20 Total assets 289,768 288,715 287,303 289,388 301,036 290,607 293,439 292,539 LIABILITIES 21 Federal Reserve notes 223300,,883366 232,312 223322,,997777 223344,,778855 223355,,229999 222299,,007766 223300,,446677 223355,,330066 Deposits 22 To depository institutions 36,989 36,720 33,537 35,877 45,024 32,253 32,351 37,277 23 U.S. Treasury—General account 7,133 5,949 6,637 4,504 6,470 13,452 13,124 5,500 24 Foreign—Official accounts 226 190 277 244 185 326 252 307 25 Other 392 228 301 232 949 318 292 311 26 Total deposits 44,739 43,087 40,753 40,856 52,628 46,348 46,018 43,395 27 Deferred credit items ^ 6,231 5,701 6,169 6,174 5,253 6,408 8,649 5,436 28 Other liabilities and accrued dividends 2,790 2,809 2,628 2,701 3,041 3,080 2,819 3,081 29 Total liabilities 284,596 283,909 282,526 284,517 296,221 284,911 287,954 287,217 CAPITAL ACCOUNTS 30 Capital paid in 2,223 2,225 2,227 2,233 2,230 2,199 2,223 2,229 31 Surplus 2,112 2,112 2,112 2,112 2,112 2,112 2,112 22,,111122 32 Other capital accounts 838 469 439 526 472 1,385 1,150 998800 33 Total liabilities and capital accounts 289,768 288,715 287,303 289,388 301,036 290,607 293,439 292,539 34 MEMO: Marketable U.S. Treasury securities held in custody for foreign and international accounts 233,384 234,715 236,514 237,031 233,024 237,904 235,318 235,096 Federal Reserve note statement 35 Federal Reserve notes outstanding issued to bank 278,810 279,088 279,415 279,515 279,559 277,676 278,866 279,629 36 LESS: Held by bank 47,974 46,775 46,438 44,730 44,260 48,601 48,398 44,321 37 Federal Reserve notes, net 230,836 232,312 232,977 234,785 235,299 229,076 230,467 235,306 Collateral held against notes net: 38 Gold certificate account 11,062 11,062 11,062 11,061 11,060 11,065 11,062 11,060 39 Special drawing rights certificate account 8,518 8,518 8,518 8,518 8,518 8,518 8,518 8,518 40 Other eligible assets 0 0 0 0 0 0 0 0 41 U.S. Treasury and agency securities 211,256 212,732 213,397 215,207 215,721 209,493 210,887 215,728 42 Total collateral 230,836 232,312 232,977 234,785 235,299 229,076 230,467 235,306 1. Some of these data also appear in the Board's H.4.1 (503) release. For 3. Valued monthly at market exchange rates. address, see inside front cover. Components may not add to totals because of 4. Includes special investment account at the Federal Reserve Bank of Chicago rounding. in Treasury bills maturing within 90 days. 2. Includes securities loaned—fully guaranteed by U.S. Treasury securities 5. Includes exchange-translation account reflecting the monthly revaluation at pledged with Federal Reserve Banks—and excludes securities sold and scheduled market exchange rates of foreign-exchange commitments. to be bought back under matched sale-purchase transactions. 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 Holdings1 Millions of dollars Wednesday End of month TTTyyypppeee aaannnddd mmmaaatttuuurrriiitttyyy gggrrrooouuupppiiinnngggsss 1989 1989 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Sept. 29 Oct. 31 Nov. 30 1 Loans—Total 231 177 1,330 169 1,225 533 270 182 2 Within 15 days 121 70 1,293 162 1,214 455 193 134 3 16 days to 90 days 109 107 37 7 11 78 77 48 4 91 days to 1 year 0 0 0 0 0 0 0 0 5 Acceptances—Total 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 8 91 days to 1 year 0 0 0 0 0 0 0 0 9 U.S. Treasury securities—Total 217,752 216,595 216,088 219,405 228,897 221,051 218,176 223,142 10 Within 15 days2 11,686 8,151 10,269 13,524 19,836 5,383 8,144 4,468 11 16 days to 90 days 44,711 47,718 40,798 48,086 48,452 54,519 48,677 51,283 12 91 days to 1 year 70,197 69,569 73,053 65,828 68,641 69,961 70,197 74,646 13 Over 1 year to 5 years 51,476 51,476 52,732 52,732 52,732 51,537 51,476 53,509 14 Over 5 years to 10 years 13,175 13,175 12,529 12,529 12,529 13,145 13,175 12,529 26,506 26,506 26,706 26,706 26,706 26,506 26,506 26,706 16 Federal agency obligations—Total 6,525 6,525 6,525 6,600 7,689 6,555 6,525 6,525 17 Within 15 days2 0 0 82 403 1,480 191 89 316 18 16 days to 90 days 672 791 709 463 418 619 672 418 19 91 days to 1 year 1,446 1,327 1,327 1,327 1,395 1,339 1,357 1,395 20 Over 1 year to 5 years 3,180 3,180 3,180 3,180 3,159 3,213 3,180 3,159 21 Over 5 years to 10 years 1,038 1,038 1,038 1,038 1,048 1,004 1,038 1,048 22 Over 10 years 189 189 189 189 189 189 189 189 I. Holdings under repurchase agreements are classified as maturing within 15 NOTE: Components may not add to totals due to rounding, days in accordance with maximum maturity of the agreements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A12 DomesticN onfinancial Statistics • February 1990 1.20 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND MONETARY BASE1 Billions of dollars, averages of daily figures 1989 11998855 11998866 11998877 11998888 IItteemm DDeecc.. DDeecc.. DDeecc.. DDeecc.. Apr. May June July Aug. Sept. Oct. Nov. Seasonally adjusted AADDJJUUSSTTEEDD FFOORR __ CCHHAANNGGEESS IINN RREESSEERRVVEE RREEQQUUIIRREEMMEENNTTSS''11 11 TToottaall rreesseerrvveess33 48.49 58.14 58.69 60.71 59.46 58.74 58.35 58.70 58.75 59.22 59.62 59.57 22 NNoonnbboorrrroowweedd rreesseerrvveess 47.17 57.31 57.92 58.99 57.17 57.02 56.86 58.00 58.08 58.53 59.07 59.22 33 NNoonnbboorrrroowweedd rreesseerrvveess pplluuss eexxtteennddeedd ccrreeddiitt 47.67 57.62 58.40 60.23 58.88 58.22 57.78 58.11 58.12 58.55 59.09 59.24 44 RReeqquuiirreedd rreesseerrvveess 47.44 56.77 57.66 59.67 58.69 57.71 57.44 57.73 57.87 58.29 58.60 58.62 55 MMoonneettaarryy bbaassee55 219.51 241.45 257.99 275.50 278.75' 278.43' 279.06 280.01r 280.29 282.04' 282.70' 283.01 Not seasonally adjusted 6 Total reserves3 49.59 59.46 60.06 62.21 60.01 57.72 58.41 58.95 58.30 58.91 59.14 59.72 7 Nonborrowed reserves 48.27 58.64 59.28 60.50 57.72 56.00 56.92 58.26 57.62 58.21 58.58 59.37 8 Nonborrowed reserves plus extended credit4 48.77 58.94 59.76 61.74 59.43 57.20 57.84 58.37 57.66 58.24 58.61 59.39 9 Required reserves 48.53 58.09 59.03 61.17 59.23 56.69 57.51 57.99 57.41 57.97 58.12 58.78 10 Monetary base 222.73 245.25 262.08 279.71 278. W 277.59' 280.19' 282.10' 281.09 280.70' 281.37' 284.13 NOT ADJUSTED FOR , CHANGES IN RESERVE REQUIREMENTS" 11 Total reserves3 48.14 59.56 62.12 63.74 61.29 58.91 59.59 60.25 59.56 60.13 60.40 60.99 12 Nonborrowed reserves 46.82 58.73 61.35 62.02 59.00 57.19 58.10 59.56 58.88 59.43 59.84 60.64 13 Nonborrowed reserves plus extended credit 47.32 59.04 61.83 63.27 60.71 58.39 59.01 59.67 58.93 59.46' 59.86 60.66 14 Required reserves 47.08 58.19 61.09 62.70 60.51 57.88 58.68 59.29 58.67 59.19 59.38 60.04 15 Monetary base5 223.53 247.71 266.16 283.18 281.6C 280.64' 283.28' 285.39' 284.23 283.78' 284.49' 287.35 1. Latest monthly and biweekly figures are available from the Board's H.3(502) the terms and conditions established for the extended credit program to helpdestatistical release. Historical data and estimates of the impact on required reserves pository institutions deal with sustained liquidity pressures. Because there isnot of changes in reserve requirements are available from the Monetary and Reserves the same need to repay such borrowing promptly as there is with traditional Projections Section. Division of Monetary Affairs. Board of Governors of the short-term adjustment credit, the money market impact of extended credit is Federal Reserve System, Washington, D.C. 20551. similar to that of nonborrowed reserves. 2. Figures incorporate adjustments for discontinuities associated with the 5. The monetary base not adjusted for discontinuities consists of total reserves implementation of the Monetary Control Act and other regulatory changes to plus required clearing balances and adjustments to compensate for float at Federal reserve requirements. To adjust for discontinuities due to changes in reserve Reserve Banks and the currency component of the money stock plus, for instirequirements on reservable nondeposit liabilities, the sum of such required tutions not having required reserve balances, the excess of current vault cash over reserves is subtracted from the actual series. Similarly, in adjusting for disconti- the amount applied to satisfy current reserve requirements. Currency and vault nuities in the monetary base, required clearing balances and adjustments to cash figures are measured over the weekly computation period ending Monday. compensate for float also are subtracted from the actual series. The seasonally adjusted monetary base consists of seasonally adjusted total 3. Total reserves not adjusted for discontinuities consist of reserve balances reserves, which include excess reserves on a not seasonally adjusted basis, plus with Federal Reserve Banks, which exclude required clearing balances and the seasonally adjusted currency component of the money stock and the remainadjustments to compensate for float, plus vault cash held during the lagged ing items seasonally adjusted as a whole. computation period by institutions having required reserve balances at Federal 6. Reflects actual reserve requirements, including those on nondeposit liabili- Reserve Banks plus the amount of vault cash equal to required reserves during the ties, with no adjustments to eliminate the effects of discontinuities associated with maintenance period at institutions having no required reserve balances. implementation of the Monetary Control Act or other regulatory changes to 4. Extended credit consists of borrowing at the discount window under reserve requirements. 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 MEASURES1 Billions of dollars, averages of daily figures 1989 1985 1986 1987 1988 Item Dec. Dec. Dec. Dec. Aug. Sept/ Oct. Nov. Seasonally adjusted 1 Ml 620.5 725.9 752.3 790.3 777.4 781.1 787.7' 790.0 2 M2 2,567.4 2,811.2 2,909.9 3,069.6 3,136.5 3,155.9 3,176.5' 3,198.9 M3 3,201.7 3,494.9 3,677.6 3,915.4 4,009.0 4,012.1 4,027. r 4,047.3 4 L 3,828.5 4,135.1 4,336.7 4,672.2 4,812.9' 4,824.9 4,852.8 n.a. 5 Debt 6,741.5 7,597.0 8,316.1 9,082.2' 9,558.9' 9,615.3 9,681.7 n.a. Ml components 6 Currency3 167.8 180.5 196.4 211.8 218.4 219.3 219.7 220.3 7 Travelers checks* 5.9 6.5 7.1 7.6 7.2 7.2 7.3 7.5 8 Demand deposits 267.3 303.2 288.3 288.6 277.5 277.3 280.4 279.0 9 Other checkable deposits 179.5 235.8 260.4 282.3 274.4 277.3 280.3' 283.3 Nontransactions components 10 In M27 1,946.9 2,085.3 2,157.6 2,279.3 2,359.1 2,374.8 2,388.8' 2,408.9 11 In M3 only8 634.3 683.7 767.7 845.8 872.4 856.2 850.6' 848.4 Savings deposits9 12 Commercial Banks 125.0 155.8 178.5 192.5 183.0 184.2 185.1 187.3 13 Thrift institutions 176.6 215.2 237.8 238.8 219.3 220.0 220.7' 222.1 Small-denomination time deposits10 14 Commercial Banks 383.3 364.6 385.3 443.1 508.1 509.8 515.3' 517.7 15 Thrift institutions 499.2 489.3 528.8 582.2 624.0 622.5 616.4' 613.5 Money market mutual funds 16 General purpose and broker-dealer 176.5 208.0 221.1 239.4 285.5 294.8 301.5 309.8 17 Institution-only 64.5 84.4 89.6 87.6 100.6 99.1 98.7 102.0 Large-denomination time deposits" 18 Commercial Banks 285.1 288.8 325.4 364.9 397.0 395.8 397.9 400.6 19 Thrift institutions 151.5 150.1 162.0 172.9 172.1 167.9 163.1 159.4 Debt components 20 Federal debt 1,585.8 1,805.8 1,957.4 2,113.5 2,199.9' 2,220.1 2,238.3 n.a. 21 Nonfederal debt 5,155.7 5,791.2 6,358.6 6,968.7' 7,359.0' 7,395.2 7,443.4 n.a. Not seasonally adjusted ??. Ml 633.5 740.4 766.4 804.4 777.4' 778.5 784.4' 791.5 23 M2 2,576.2 2,821.1 2,918.7 3,077.3 3,137.5 3,149.3 3,172.4' 3,196.9 24 M3 3,213.3 3,507.4 3,688.6 3,925.2 4,010.6 4,010.2 4,024.5' 4,052.6 25 L 3,841.5 4,150. lr 4,350.9 4,685.6 4,807.7' 4,819.7 4,848.2 n.a. 26 Debt 6,730.9 7,580.7 8,297.6 9,067.5' 9,512.4r 9,577.0 9,647.6 n.a. Ml components 27 Currency 170.2 183.0 199.3 214.9 219.3 218.7 219.0 221.2 28 Travelers checks 5.5 6.0 6.5 6.9 8.1 7.7 7.3 7.0 29 Demand deposits 276.9 314.0 298.6 298.8 276.7 275.9 280.3 281.2 30 Other checkable deposits 180.9 237.4 262.0 283.7 273.3 276.2 277.8' 282.0 Nontransactions components 31 M2 1,942.7 2,080.7 2,152.3 22,,227722..99 2,360.1 2,370.8 2,388.0 22,,440055..44 32 M3 only8 637.1 686.3 769.9 848.0 873.1 860.8 852.1' 855.7 Money market deposit accounts 33 Commercial Banks 332.8 379.6 358.8 352.5 335.7 338.9 342.0 349.8 34 Thrift institutions 180.7 192.9 167.5 150.3 129.7 130.2 131.0 132.1 Savings deposits9 Commercial Banks 123.7 154.2 176.6 190.3 184.0 183.9 185.5 186.7 36 Thrift institutions 174.8 212.7 234.8 235.6 221.1 220.8 221.9' 221.2 Small-denomination time deposits10 37 Commercial Banks 384.0 365.3 386.1 444.1 507.6 510.2 515.6' 519.4 38 Thrift institutions 499.9 489.8 529.1 582.4 621.5 619.7 616.9' 613.9 Money market mutual funds 39 General purpose and broker-dealer 176.5 208.0 221.1 239.4 285.5 294.8 301.5 309.8 40 Institution-only 64.5 84.4 89.6 87.6 100.6 99.1 98.7 102.0 Large-denomination time deposits11 41 Commercial Banks 285.4 289.1 325.8 365.6 397.7 398.0 399.5' 402.0 42 Thrift institutions 151.8 150.7 163.0 174.1 171.3 168.3 164.9 161.1 Debt components 43 Federal debt 1,583.7 1,803.9 1,955.6 2,111.8 2,179.7'' 2,200.9 2,222.6 n.a. 44 Nonfederal debt 5,147.1 5,776.8 6,342.0 6,955.7' 7,332.8r 7,376.1 7,425.0 n.a. For notes see following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Nonfinancial Statistics • February 1990 NOTES TO TABLE 1.21 1. Latest monthly and weekly figures are available from the Board's H.6 (508) Debt: Debt of domestic nonfinancial sectors consists of outstanding credit release. Historical data are available from the Monetary and Reserves Projection market debt of the U.S. government, state and local governments, and private section, Division of Monetary Affairs, Board of Governors of the Federal Reserve nonfinancial sectors. Private debt consists of corporate bonds, mortgages, con- System, Washington, D.C. 20551. sumer credit (including bank loans), other bank loans, commercial paper, bankers 2. Composition of the money stock measures and debt is as follows: acceptances, and other debt instruments. The source of data on domestic Ml: (1) currency outside the Treasury, Federal Reserve Banks, and the vaults nonfinancial debt is the Federal Reserve Board's flow of funds accounts. Debt of depository institutions; (2) travelers checks of nonbank issuers; (3) demand data are based on monthly averages. deposits at all commercial banks other than those due to depository institutions, 3. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of the U.S. government, and foreign banks and official institutions less cash items in depository institutions. the process of collection and Federal Reserve float; and (4) other checkable 4. Outstanding amount of U.S. dollar-denominated travelers checks of nondeposits (OCD) consisting of negotiable order of withdrawal (NOW) and auto- bank issuers. Travelers checks issued by depository institutions are included in matic transfer service (ATS) accounts at depository institutions, credit union demand deposits. share draft accounts, and demand deposits at thrift institutions. 5. Demand deposits at commercial banks and foreign-related institutions other M2: Ml plus overnight (and continuing contract) repurchase agreements (RPs) than those due to depository institutions, the U.S. government, and foreign banks issued by all commercial banks and overnight Eurodollars issued to U.S. residents and official institutions less cash items in the process of collection and Federal by foreign branches of U.S. banks worldwide, MMDAs, savings and small- Reserve float. denomination time deposits (time deposits—including retail RPs—in amounts of 6. Consists of NOW and ATS balances at all depository institutions, credit less than $100,000), and balances in both taxable and tax-exempt general purpose union share draft balances, and demand deposits at thrift institutions. and broker-dealer money market mutual funds. Excludes individual retirement 7. Sum of overnight RPs and overnight Eurodollars, money market fund accounts (IRA) and Keogh balances at depository institutions and money market balances (general purpose and broker-dealer), MMDAs, and savings and small funds. Also excludes all balances held by U.S. commercial banks, money market time deposits. funds (general purpose and broker-dealer), foreign governments and commercial 8. Sum of large time deposits, term RPs, and term Eurodollars of U.S. banks, and the U.S. government. residents, money market fund balances (institution-only), less the estimated M3: M2 plus large-denomination time deposits and term RP liabilities (in amount of overnight RPs and Eurodollars held by institution-only money market amounts of $100,000 or more) issued by commercial banks and thrift institutions, funds. term Eurodollars held by U.S. residents at foreign branches of U.S. banks 9. Savings deposits exclude MMDAs. worldwide and at all banking offices in the United Kingdom and Canada, and 10. Small-denomination time deposits—including retail RPs—are those issued balances in both taxable and tax-exempt, institution-only money market mutual in amounts of less than $100,000. All individual retirement accounts (IRA) and funds. Excludes amounts held by depository institutions, the U.S. government, Keogh accounts at commercial banks and thrifts are subtracted from small time money market funds, and foreign banks and official institutions. Also subtracted deposits. is the estimated amount of overnight RPs and Eurodollars held by institution-only 11. Large-denomination time deposits are those issued in amounts of $100,000 money market mutual funds. or more, excluding those booked at international banking facilities. L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term 12. Large-denomination time deposits at commercial banks less those held by Treasury securities, commercial paper and bankers acceptances, net of money money market mutual funds, depository institutions, and foreign banks and market mutual fund holdings of these assets. official institutions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary and Credit Aggregates A15 1.22 BANK DEBITS AND DEPOSIT TURNOVER1 Debits are shown in billions of dollars, turnover as ratio of debits to deposits. Monthly data are at annual rates. 1989 BBaannkk ggrroouupp,, oorr ttyyppee ooff ccuussttoommeerr 11998866 11998877 11998888 Apr. May June July Aug. Sept. DEBITS TO Seasonally adjusted Demand deposits3 1 All insured banks 188,346.0 217,116.2 226,888.4 245,230.1 266,468.1 284,129.2 276,453.7 292,446.5 281,432.2 2 Major New York City banks 91,397.3 104,4%.3 107,547.3 107,808.9 120,984.1 129,166.6 114,991.8 121,378.1 125,206.9 3 Other banks 96,948.8 112,619.8 119,341.2 137,421.3 145,483.9 154,962.7 161,461.9 171,068.3 156,225.3 4 ATS-NOW accounts4 2,182.5 2,402.7 2,757.7 2,986.4 3,406.5 3,696.5 3,596.3 3,943.1 3,601.9 5 Savings deposits 403.5 526.5 583.0 585.5 647.2 640.0 580.4 650.0 672.3 DEPOSIT TURNOVER Demand deposits3 6 All insured banks 556.5 612.1 641.2 697.5 767.1 824.0 788.4 841.8 802.2 7 Major New York City banks 2,498.2 2,670.6 2,903.5 3,092.2 3,342.1 3,588.5 3,222.3 3,402.4 3,482.2 8 Other banks 321.2 357.0 376.8 433.9 467.5 501.8 512.6 548.8 496.2 9 ATS-NOW accounts4 15.6 13.8 14.7 15.7 18.2 19.8 19.1 20.6 18.8 10 Savings deposits 3.0 3.1 3.1 3.2 3.6 3.6 3.2 3.6 3.7 DEBITS TO Not seasonally adjusted Demand deposits 11 All insured banks 188,506.7 217,125.1 227,010.7 238,265.6 274,861.8 295,522.8 268,243.0 304,407.5 266,882.2 12 Major New York City banks. 91,500.1 104,518.8 107,565.0 105,461.7 121,507.2 134,020.7 117,276.1 132,158.8 115,187.4 13 Other banks 97,006.7 112,606.2 119,445.7 132,803.9 153,354.6 161,502.1 150,966.9 172,248.7 151,694.7 14 ATS-NOW accounts4 2,184.6 2,404.8 2,754.7 3,205.2 3,325.2 3,770.8 3,549.0 3,762.6 3,702.7 15 MMDA6 1,609.4 1,954.2 2,430.1 2,700.2 2,910.5 3,136.0 2,686.7 3,068.7 2,554.3 16 Savings deposits 404.1 526.8 578.0 649.6 637.9 641.4 610.4 656.7 665.2 DEPOSIT TURNOVER Demand deposits3 17 All insured banks 556.7 612.3 641.7 676.6 805.9 855.6 761.3 891.5 763.1 18 Major New York City banks 2,499.1 2,674.9 2,901.4 3,017.6 3,482.5 3,795.0 3,247.5 3,911.6 3,279.7 19 Other banks 321.2 356.9 377.1 418.7 500.9 520.9 477.4 559.9 482.2 20 ATS-NOW accounts4 15.6 13.8 14.7 16.3 18.0 20.3 18.9 20.0 19.5 21 MMDA 4.5 5.3 6.9 8.1 9.0 9.7 8.2 9.2 7.6 22 Savings deposits5 3.0 3.1 3.1 3.5 3.5 3.6 3.4 3.6 3.7 1. Historical tables containing revised data for earlier periods may be obtained of states and political subdivisions. from the Monetary and Reserves Projections Section, Division of Monetary 4. Accounts authorized for negotiable orders of withdrawal (NOW) and ac- Affairs, Board of Governors of the Federal Reserve System, Washington, D.C. counts authorized for automatic transfer to demand deposits (ATS). ATS data are 20551. available beginning December 1978. These data also appear on the Board's G.6 (406) release. For address, see inside 5. Excludes ATS and NOW accounts, MMDA and special club accounts, such front cover. as Christmas and vacation clubs. 2. Annual averages of monthly figures. 6. Money market deposit accounts. 3. Represents accounts of individuals, partnerships, and corporations and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Nonfinancial Statistics • February 1990 1.23 LOANS AND SECURITIES All Commercial Banks1 Billions of dollars; averages of Wednesday figures 1988 1989 Category Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Seasonally adjusted 1 Total loans and securities2 2,417.2 2,422.8 2,451.9 2,464.9 2,470.9 2,486.3 2,496.8 2,518.1 2,534.4 2,544.1 2,575.5 2,583.9 2 U.S. government securities 361.4 360.4 361.8 368.8 370.7 373.5 373.8 374.4 376.6 378.8 391.7 397.5 4 3 T O o th ta e l r l s o e a c n u s r i a t n ie d s leases2 1,8 1 6 9 1 4 . . 9 0 1,8 1 7 8 2 9 . . 9 6 1,8 1 9 9 9 0 . . 7 4 1,9 1 0 8 6 9 . . 5 7 1,9 1 1 8 3 7 . . 1 2 1,9 1 2 8 6 6 . . 5 4 1,9 1 3 8 7 5 . . 3 7 1,9 1 5 8 9 4 . . 1 6 1,9 1 7 8 4 2 . . 9 8 1,9 1 8 8 2 2 . . 4 9 2,0 1 0 8 1 2 . . 1 7 2,0 1 0 8 6 0 . . 1 3 5 Commercial and industrial ..... 601.9 606.6 619.0 617.8 620.6 626.3 624.9 632.1 637.3 636.9 641.1 641.6 6 Bankers acceptances held ... 4.1 4.4 4.2 4.0 4.1 4.2 4.2 4.1 4.5 4.8 5.4 4.9 7 Other commercial and 9 8 N U i o . n S n d . - u U a s d . t S r d i . r a e l a s d s d ee re s4 s sees4 5 5 9 9 5 7 1 . . . 9 8 8 6 5 0 9 2 5 6 . . . 2 7 6 6 6 1 0 4 4 9 . . . 9 8 9 6 6 1 0 5 3 8 . . . 4 7 3 6 6 1 1 4 6 1 . . . 6 7 9 ' 6 6 2 1 5 2 6 . . . 4 1 6 6 6 2 1 0 5 5 . . . 7 5 2 6 6 2 2 5 8 2 . . . 1 9 2 6 6 3 2 5 2 7 . . . 8 7 1 6 6 3 2 5 2 6 . . . 5 1 6 6 6 3 2 6 5 9 . . . 2 7 4 6 6 3 3 5 6 1 . . . 4 7 3 10 Real estate 672.0 678.9 685.6 691.8 699.5 705.5 712.0 719.9 729.0 734.4 741.1 747.7 11 Individual 355.5 357.9 358.9 360.6 362.9 365.4 366.0 367.0 369.3 372.1 374.4 376.9 12 Security 38.5 37.6r 44.7 43.5' 39. V 38.(y 41.2' 40.5 39.8' 40.6 42.3 41.4 13 Nonbank financial institutions 30.0 30. r 30.5' 29.6' 29.1' 28.6' 30.2' 31.3' 31.7' 32.1 33.r 33.1 14 Agricultural 30.7 30.7 30.7 30.7 30.4 30.3 30.3 30.4 30.3 30.2 30.1 30.5 15 State and political subdivisions 46.7r 44.2r 44.3' 44.3' 44.4' 44.4' 44.2' 43^ 43.6' 43.5 42.9 42.3 16 Foreign banks 7.6 7.8 8.5 8.2 8.4' 9.4 9.3 8.9 9.3 8.5 9.8 9.1 17 Foreign official institutions 4.9 4.8 4.8 4.8 4.9 4.9 4.7 4.5 4.3 4.3 4.0 3.8 18 Lease financing receivables 29.2 29.4 29.6 29.6 29.8 30.0 29.9 30.3 30.3 31.0 31.6 31.6 19 All other loans 44.9' 44.8r 43.1' 45.6' 43.2' 43.7' 44.5' 50.2' 49.9' 48.7' 50.7' 48.1 Not seasonally adjusted 20 Total loans and securities2 2,429.6 2,430.7 2,453.6 2,462.8 2,473.9 2,487.4 2,500.9 2,511.8 2,526.9 2,541.2 2,565.6' 2,582.7 21 U.S. government securities ... 361.6 362.2 366.3 370.2 370.9 372.6 372.6 373.1 376.8 378.5 388.3 396.1 2 2 2 3 O To th ta e l r l s o e a c n u s r i a t n ie d s leases2 1,8 1 7 9 4 3 . . 2 7 1,8 1 7 9 6 1 . . 9 7 1,8 1 9 9 7 0 . . 2 1 1,9 1 0 8 3 8 . . 7 9 1,9 1 1 8 5 7 . . 9 2 1,9 1 2 8 8 6. . 8 0 1,9 1 4 8 2 6 . . 3 0 1,9 1 5 8 4 4 . . 6 1 1,9 1 6 8 6 3 . . 9 1 1,9 1 8 8 0 2 . . 0 8 1,9 1 9 8 5 1 . . 6 6 2,0 1 0 8 6 0 . . 1 5 24 Commercial and industrial ., 605.0 605.8 618.3 621.1 625.2 630.0 629.0 631.0 632.7 632.2 636.0 638.7 25 Bankers acceptances held 4.1 4.1 4.1 4.0 4.0 4.3 4.4 4.2 4.6 4.9 5.5 4.8 26 Other commercial and 27 U.S. i n a d d u d s r t e ri s a s l e es4 6 5 0 9 0 4 . . 9 8 6 5 0 9 1 6 . . 7 4 6 6 1 0 4 8 . . 2 9 6 6 1 1 7 1 . . 1 8 6 61 2 6 1 . . 0 3 6 62 2 0 5 . . 2 8 6 61 2 9 4 . . 0 6 6 6 2 2 1 6 . . 1 8 6 6 2 2 8 2 . . 0 6 6 6 2 2 7 1 . . 3 8 6 6 2 3 5 0 . . 0 5 6 6 2 3 8 4 . . 6 0 28 Non-U.S. addressees .... 6.1 5.3 5.3 5.3 5.3 5.5 5.6 5.6 5.5 5.5 5.5 5.4 29 Real estate 673.3 678.9 683.6 689.2 697.4 704.1 712.1 720.6 730.4 736.5 741.9 749.8 30 Individual 359.4 360.7 358.2 357.7 360.3 363.2 364.5 365.9 369.3 374.0 375.6 378.1 31 Security 38.9 38.1' 43.7' 44.1 42.0 38.9 42.9 40.1' 38.5' 39.1 40.5 40.7 32 Nonbank financial institutions 31.1 30.6' 29.9r 29.C 28.9' 28.8' 30.4' 31.3' 31.6' 32.0 32.7' 33.3 33 Agricultural 30.5 30.1 29.7' 29.6 29.5' 30.1 30.6' 31.1 31.2 31.1 31.0 30.7 34 State and political subdivisions 46.6 45.6' 45.3' 44.9' 44.6' 44.3' 43^ 43.4' 43.2' 42.9 42.5 41.8 35 Foreign banks 7.9 8.1 8.5 8.0 8.1' 9.0 9.1 9.0 9.1 8.7 9.8 9.2 36 Foreign official institutions.. 4.9 4.8 4.8 4.8 4.9 4.9 4.7 4.5 4.3 4.3 4.0 3.8 37 Lease financing receivables . 29.4 29.7 29.7 29.7 29.8 30.0 30.0 30.2 30.2 30.9 31.4 31.5 38 All other loans 47.3 44.4' 45.4' 45.8' 45.C 44.8' 45.2' 47.6' 46.5' 48.2' 50.2' 48.5 1. Data have been revised because of benchmarking beginning January 1984. 2. 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 3. Includes nonfinancial commercial paper held. front cover. 4. United States includes the 50 states and the District of Columbia. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions A17 1.24 MAJOR NONDEPOSIT FUNDS OF COMMERCIAL BANKS1 Monthly averages, billions of dollars 1988 1989 SSoouurrccee Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Seasonally adjusted 1 Total nondeposit funds2 — 215.2 208.2 211.3 212.1 205.9 209.9 226.9' 228.3 229.7' 237.9' 248.3' 251.8 2 Net balances due to related foreign offices .... 6.8 8.2 10.7 8.2 3.0 -.1 i.r 11.1 9.2' 9.6' 9.9 8.7 3 Borrowings from other than commercial banks in United States4 208.4 200.0 200.6 203.9 202.9 210.0 219.2 217.2 220.5 228.3 238.4' 243.1 4 Domestically chartered banks 169.4 163.0 161.3 165.8 164.2 169.2 179.1 175.4 178.2 184.9 192.0 194.4 5 Foreign-related banks 39.0 37.0 39.3 38.1 38.7 40.7 40.1 41.8 42.3 43.4 46.4 48.7 Not seasonally adjusted 6 Total nondeposit funds2 ^ 209.6 207.4 216.1 217.7 208.6 217.5 230.0' 224.0 228.5' 233.9 241.4' 247.5 7 Net balances due to related foreign offices 9.3' 7.9 10.5 7.2 .9 2.5 7.9r 8.1 8.8' 10.6' 9.6' 9.7 8 Domestically chartered banks -20.6 -20.2 -17.6 -19.5 -22.8 -21.9 -18.3 -16.4 -15.5 -14.2 -14.8 -15.2 9 Foreign-related banks 29.9 28.1 28.1 26.7 23.7 24.4' 26.2r 24.5' 24.3' 24.8' 24.4 24.9 10 Borrowings from other than commercial banks in United States4 200.3 199.5 205.7 210.6 207.7 215.0 222.2 215.9 219.7 223.3 231.8' 237.8 11 Domestically chartered banks 163.3 161.3 165.1 170.9 168.1 173.8 180.5 173.5 177.7 180.7 187.2 192.7 12 Federal funds and security RP borrowings 159.8 157.9 161.9 167.5 163.8 170.1 177.0 170.8 175.1 178.1 184.8 190.7 13 Other 3.5 3.4 3.2 3.5 4.3 3.7 3.4 2.7 2.6 2.6 2.4 2.0 14 Foreign-related banks 37.0 38.1 40.6 39.6 39.6 41.2 41.7 42.4 42.0 42.6 44.7 45.0 MEMO Gross large time deposits 15 Seasonally adjusted 429.2 434.9 440.3 446.7 452.7 456.8 458.8 461.6 460.4 458.0 459.3' 461.3 16 Not seasonally adjusted 429.8 434.5 440.2 448.2 450.6 455.5 457.3 458.8 461.2 460.1 461.0' 462.8 U.S. Treasury demand balances at commercial banks8 17 Seasonally adjusted 24.9 20.3 20.3 20.3 20.9 27.1 27.4 22.7 22.9 23.8 19.9 20.3 18 Not seasonally adjusted 22.9 25.0 25.9 18.1 20.2 34.3 26.2 23.0 15.8 24.9 20.6' 14.6 1. Commercial banks are those in the 50 states and the District of Columbia 4. Other borrowings are borrowings through any instrument, such as a promwith national or state charters plus agencies and branches of foreign banks, New issory note or due bill, given for the purpose of borrowing money for the banking York investment companies majority owned by foreign banks, and Edge Act business. This includes borrowings from Federal Reserve Banks and from foreign corporations owned by domestically chartered and foreign banks. banks, term federal funds, loan RPs, and sales of participations in pooled loans. These data also appear in the Board's G.10 (411) release. For address, see 5. Based on daily average data reported weekly by approximately 120 large inside front cover. banks and quarterly or annual data reported by other banks. 2. Includes federal funds, RPs, and other borrowing from nonbanks and net 6. Figures are partly daily averages and partly averages of Wednesday data. balances due to related foreign offices. 7. Time deposits in denominations of $100,000 or more. Estimated averages of 3. Reflects net positions of U.S. chartered banks, Edge Act corporations, and daily data. U.S. branches and agencies of foreign banks with related foreign offices plus net 8. U.S. Treasury demand deposits and Treasury tax-and-loan notes at compositions with own IBFs. mercial banks. Averages of daily data. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A18 Domestic Nonfinancial Statistics • February 1990 1.25 ASSETS AND LIABILITIES OF COMMERCIAL BANKING INSTITUTIONS Last-Wednesday-of-Month Series1 Billions of dollars 1989 Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. ALL COMMERCIAL BANKING INSTITUTIONS2 1 Loans and securities 2,587.0 2,624.0 2,627.1 2,623.0 2,659.8 2,660.7 2,677.1 2,692.5 2,695.7 2,728.1 2,764.7 2 Investment securities 533.5 535.8 539.1 538.3 541.1 541.6 538.3 542.8 542.4 545.4 549.5 i U.S. government securities 347.3 351.3 355.5 356.6 359.1 362.2 360.3 365.3 366.4 370.8 375.8 4 Other 186.2 184.5 183.6 181.7 182.0 179.4 178.1 177.5 176.1 174.6 173.7 5 Trading account assets 21.5 20.1 21.8 17.8 19.2 18.2 19.8 18.7 18.3 26.6 27.6 6 Total loans 2,032.1 2,068.0 2,066.2 2,066.8 2,099.5 2,100.9 2,119.0 2,131.0 2,135.0 2,156.1 2,187.6 1 Interbank loans 159.9 173.2 154.9 150.7 160.5 155.0 162.4 162.9 158.0 164.2 179.9 8 Loans excluding interbank 1,872.2 1,894.9 1,911.3 1,916.2 1,939.0 1,945.9 1,956.6 1,968.1 1,977.1 1,992.0 2,007.8 9 Commercial and industrial 604.6 617.6 622.9 627.3 631.1 628.3 635.3 631.9 630.3 634.9 638.7 10 Real estate 679.7 684.1 692.6 699.4 706.7 715.1 722.8 733.9 737.5 743.2 752.1 11 Individual 360.8 358.3 358.1 361.8 363.8 366.0 366.2 371.4 375.5 376.1 378.8 12 All other 227.0 234.8 237.7 227.7 237.4 236.6 232.3 231.0 233.7 237.8 238.2 13 Total cash assets 216.1 227.4 211.5 215.8 248.3 214.2 211.7 212.0 219.6 213.0 234.8 14 Reserves with Federal Reserve Banks. 31.5 27.7 30.9 33.4 27.8 27.9 30.6 28.7 31.7 28.0 38.7 15 Cash in vault 27.5 26.6 26.8 26.9 27.9 27.6 27.4 28.5 28.0 27.9 30.7 16 Cash items in process of collection ... 76.4 89.1 75.9 78.8 107.6 78.7 75.2 77.4 8822..66 7777..55 8844..11 17 Demand balances at U.S. depository institutions 28.7 33.3 28.8 28.5 34.9 29.6 28.8 29.7 29.0 28.8 28.9 18 Other cash assets 52.0 50.7 49.0 48.3 50.2 50.5 49.7 47.7 48.3 50.7 52.3 19 Other assets 194.6 191.4 194.1 200.7 206.8 198.7 201.1 199.6 203.9 203.8 201.9 20 Total assets/total liabilities and capital 2,997.8 3,042.8 3,032.7 3,039.5 3,114.9 3,073.6 3,090.0 3,104.0 3,119.3 3,144.9 3,201.4 21 Deposits 2,097.1 2,125.2 2,123.7 2,134.2 2,182.6 2,138.2 2,152.0 2,166.6 2,175.3 2,194.2 2,221.1 22 Transaction deposits 586.6 602.6 583.2 594.5 628.5 580.5 579.4 583.4 588.5 588.0 602.5 23 Savings deposits 528.8 527.3 523.2 512.0 509.7 507.4 514.0 518.9 520.7 527.6 537.6 24 Time deposits 981.7 995.3 1,017.3 1,027.6 1,044.3 1,050.2 1,058.6 1,064.4 1,066.1 1,078.6 1,081.0 25 Borrowings 493.6 502.9 483.6 486.7 510.6 512.7 510.2 504.6 516.5 526.5 542.2 26 Other liabilities 209.1 216.5 223.9 217.4 218.6 218.4 223.1 226.3 221.4 222.4 235.2 27 Residual (assets less liabilities) 198.0 198.2 201.4 201.2 203.2 204.4 204.7 206.5 206.1 201.9 202.9 MEMO 28 U.S. government securities (including trading account) 364.4 366.2 372.1 369.5 372.3 374.4 373.5 377.5 337788..55 339900..44 339966..22 29 Other securities (including trading account) 190.5 189.7 188.8 186.6 188.0 185.4 184.6 184.0 182.3 181.6 180.9 DOMESTICALLY CHARTERED COMMERCIAL BANKS3 30 Loans and securities 2,385.1 2,405.9 2,407.8 2,407.8 2,446.0 2,439.9 2,452.1 2,467.6 2,473.6 2,506.5 2,526.4 31 Investment securities 507.0 509.0 513.1 513.8 516.1 517.3 514.2 519.4 519.0 521.6 523.0 32 U.S. government securities 334.5 338.1 342.7 344.1 345.9 349.5 347.8 353.5 354.5 358.7 362.1 33 Other 172.6 171.0 170.4 169.7 170.2 167.8 166.5 165.9 164.5 162.9 160.9 34 Trading account assets 21.5 20.1 21.8 17.8 19.2 18.2 19.8 18.7 18.3 26.6 27.6 35 Total loans 1,856.6 1,876.8 1,872.8 1,876.2 1,910.6 1,904.5 1,918.1 1,929.4 1,936.3 1,958.3 1,975.8 36 Interbank loans 131.4 138.9 122.3 120.2 131.5 119.3 126.4 127.0 125.1 134.9 142.1 3/ Loans excluding interbank 1,725.2 1,737.8 1,750.5 1,756.0 1,779.2 1,785.1 1,791.7 1,802.5 1,811.2 1,823.5 1,833.7 38 Commercial and industrial 498.9 503.4 506.1 511.3 515.5 511.6 515.6 512.8 510.4 514.2 515.2 39 Real estate 657.7 661.7 669.8 676.0 683.2 691.6 698.2 708.7 712.2 717.1 724.5 40 Individual 360.5 358.0 357.7 361.4 363.5 365.6 365.8 371.1 375.2 375.8 378.5 41 All other 208.1 214.7 216.9 207.3 217.0 216.3 212.0 209.9 213.5 216.4 215.5 42 Total cash assets 193.5 206.4 191.4 195.3 227.0 192.3 190.1 191.7 197.6 191.5 209.5 43 Reserves with Federal Reserve Banks. 30.1 26.6 29.5 30.7 26.7 26.6 29.6 27.0 29.5 26.3 37.9 44 Cash in vault 27.4 26.6 26.8 26.8 27.9 27.6 27.4 28.5 28.0 27.9 30.7 45 Cash items in process of collection ... 75.6 88.1 75.1 77.9 106.6 77.7 74.4 76.5 8811..33 7766..33 8822..22 46 Demand balances at U.S. depository institutions 26.8 31.2 26.6 26.8 32.9 27.5 27.0 28.0 27.3 26.9 27.0 47 Other cash assets 33.6 33.9 33.4 33.1 33.0 32.9 31.7 31.7 31.6 34.2 31.7 48 Other assets 128.1 129.6 130.6 134.6 133.6 131.6 128.4 127.5 131.5 126.3 132.2 49 Total assets/liabilities and capital 2,706.7 2,741.8 2,729.9 2,737.7 2,806.6 2,763.9 2,770.6 2,786.7 2,802.8 2,824.3 2,868.2 50 Deposits 2,026.1 2,052.7 2,047.4 2,056.2 2,103.0 2,058.8 2,071.3 2,086.9 2,094.5 2,112.4 2,139.2 51 Transaction deposits 577.4 593.5 574.1 584.8 618.7 571.2 570.2 574.7 578.8 578.4 592.7 52 Savings deposits 526.4 524.8 520.7 509.4 507.1 504.8 511.3 516.2 517.9 525.0 534.8 53 Time deposits 922.3 934.4 952.6 961.9 977.2 982.9 989.9 995.9 997.7 1,009.0 1,011.6 54 Borrowings 377.1 378.7 362.8 368.2 383.0 387.3 380.2 375.5 390.8 393.2 404.4 55 Other liabilities 109.0 115.8 121.7 115.6 120.9 116.9 117.8 121.3 114.9 120.4 125.2 56 Residual (assets less liabilities) 194.5 194.6 197.9 197.7 199.7 200.8 201.2 203.0 202.6 198.4 199.4 MEMO 57 Real estate loans, revolving 40.7 41.7 42.5 43.4 44.3 45.3 45.7 46.4 47.1 47.9 48.5 58 Real estate loans, other 617.0 620.0 627.3 632.6 638.9 646.2 652.5 662.3 665.0 669.2 676.0 1. Back data are available from the Banking and Monetary Statistics section, the last Wednesday of the month based on a weekly reporting sample of Board of Governors of the Federal Reserve System, Washington, D.C., 20551. foreign-related institutions and quarter-end condition reports. These data also appear in the Board's weekly H.8 (510) release. 2. Commercial banking institutions include insured domestically chartered Figures are partly estimated. They include all bank-premises subsidiaries and commercial banks, branches and agencies of foreign banks, Edge Act and other significant majority-owned domestic subsidiaries. Loan and securities data Agreement corporations, and New York State foreign investment corporations. for domestically chartered commercial banks are estimates for the last Wednes- 3. Insured domestically chartered commercial banks include all member banks day of the month based on a sample of weekly reporting banks and quarter-end and insured nonmember banks. condition report data. Data for other banking institutions are estimates made for Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Commercial Banks A19 1.26 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS1 Millions of dollars, Wednesday figures 1989 AAccccoouunntt Oct. 4r Oct. 11' Oct. 18 Oct. 25 Nov. 1 Nov. 8 Nov. 15 Nov. 22 No v. 29 1 Cash and balances due from depository institutions 120,336 124,614 119,016 105,871 130,646 109,189 117,955 111,965 120,1% 2 Total loans, leases, and securities, net 1,232,984 1,231,335 1,242,060' 1,241,800' 1,274,378 1,246,046 1,265,999 1,250,175 1,250,240 3 U.S. Treasury and government agency 148,304 150,548 155,831 157,966 160,058 160,632 163,309 162,585 161,418 4 Trading account 14,086 14,966 17,855 19,574 21,235 21,716 23,416 22,109 20,406 5 Investment account 134,218 135,582 137,975 138,392 138,823 138,916 139,893 140,476 141,011 6 Mortgage-backed securities 66,189 66,411 68,127' 69,073' 69,155 69,308 70,664 71,018 71,372 All other maturing in 7 One year or less 20,204 20,390 20,087' 19,601' 19,880 19,745 19,342 19,307 19,189 8 Over one through five years 35,853 36,333 36,256' 36,130' 35,298 35,494 35,466 35,711 35,704 9 Over five years 11,971 12,448 13,505' 13,587' 14,490 14,368 14,422 14,439 14,747 10 Other securities 69,311 69,057 68,806 68,368 67,060 66,732 66,884 66,571 66,468 11 Trading account 891 745 778 913 913 900 1,064 1,032 1,182 12 Investment account 68,420 68,311 68,028 67,455 66,147 65,832 65,820 65,538 65,286 13 States and political subdivisions, by maturity 41,061 41,007 40,867 40,192 39,125 38,800 38,628 38,525 38,395 14 One year or less 4,920 4,913 4,901' 4,888' 4,850 4,943 4,932 4,947 4,948 15 Over one year 36,141 36,094 35,966' 35,304' 34,275 33,857 33,696 33,578 33,447 16 Other bonds, corporate stocks, and securities 27,359 27,304 27,161 27,263 27,022 27,032 27,192 27,014 26,890 17 Other trading account assets 5,422 6,661 5,889 6,082 6,148 6,118 6,066 6,046 5,982 18 Federal funds sold4 69,203 61,868 66,272 65,760 88,666 70,289 81,758 66,208 67,784 19 To commercial banks 48,890 40,206 43,350 44,373 61,206 46,071 56,293 43,124 45,474 20 To nonbank brokers and dealers in securities 13,750 14,839 16,273 14,886 17,833 17,280 17,373 16,695 15,902 21 To others 6,563 6,823 6,650 6,502 9,628 6,937 8,092 6,389 6,409 22 Other loans and leases, gross 983,014 986,092 988,322' 986,764' 995,361 985,325 991,079 991,900 991,549 23 Other loans, gross 957,242 960,062 962,183' 960,688' %9,204 959,202 964,937 %5,694 %5,323 24 Commercial and industrial 317,303 318,536 317,968' 317,618' 320,540 318,158 320,196 320,054 318,938 25 Bankers acceptances and commercial paper 2,217 2,116 2,242 2,251 1,816 1,787 1,721 1,721 1,520 26 All other 315,086 316,420 315,725' 315,368' 318,725 316,371 318,475 318,334 317,417 77 U.S. addressees 313,467 314,691 313,933' 313,782' 316,994 314,706 316,673 316,676 315,760 28 Non-U.S. addressees 1,618 1,730 1,792 1,586 1,731 1,665 1,802 1,657 1,657 79 Real estate loans 343,325 343,766 345,527' 345,538' 347,224 348,182 348,902 349,409 350,282 30 Revolving, home equity 26,110 26,229 26,349 26,408 26,491 26,542 26,653 26,734 26,816 31 All other 317,215 317,537 319,177' 319,130' 320,733 321,640 322,249 322,676 323,466 32 To individuals for personal expenditures 173,485 173,0% 173,494' 173,908' 174,030 174,062 174,713 174,802 175,401 33 To depository and financial institutions 49,286 51,247 51,074' 50,343' 51,104 48,710 49,411 49,635 49,021 34 Commercial banks in the United States 21,457 22,681 23,356' 22,621' 23,049 21,194 22,137 22,798 21,594 35 Banks in foreign countries 5,125 5,589 5,150 5,297 5,264 4,752 4,787 4,642 4,555 36 Nonbank depository and other financial institutions .. 22,704 22,977 22,568' 22,425' 22,791 22,764 22,487 22,195 22,872 37 For purchasing and carrying securities 16,773 16,171 16,682 16,948 17,319 15,137 16,006 16,356 15,760 38 To finance agricultural production 5,710 5,670 5,670 5,585 5,559 5,511 5,521 5,449 5,402 39 To states and political subdivisions 26,070 25,916 25,825 26,061 25,935 25,836 25,548 25,429 25,389 40 To foreign governments and official institutions 1,575 1,558 1,518 1,441 1,459 1,481 1,483 1,388 1,414 41 All other 23,716 24,100 24,426' 23,245' 26,032 22,126 23,156 23,172 23,717 42 Lease financing receivables 25,772 26,030 26,139 26,076 26,158 26,122 26,142 26,206 26,226 43 LESS: Unearned income 4,876 4,874 4,902 4,905 4,862 4,886 4,890 4,941 4,912 44 Loan and lease reserve 37,395 38,017 38,158' 38,236' 38,054 38,163 38,208 38,194 38,050 45 Other loans and leases, net 940,743 943,200 945,262' 943,623' 952,445 942,275 947,982 948,765 948,588 46 All other assets 130,329 130,200 131,761' 128,881' 134,843 136,203 138,022 132,925 133,364 47 Total assets 1,483,649 1,486,150 1,492,836' 1,476,552' 1,539,868 1,491,439 1,521,976 1,495,066 1,503,799 48 Demand deposits 232,518 238,524 233,292' 216,473' 247,460 222,108 243,069 227,363 223,373 49 Individuals, partnerships, and corporations 182,563 190,522 183,413' 173,171' 194,018 177,381 193,084 181,649 178,974 50 States and political subdivisions 5,634 5,419 5,917 5,977 7,122 5,244 6,632 6,925 5,623 51 U.S. government 5,347 1,795 4,326 2,262 1,582 3,227 4,266 3,212 1,793 52 Depository institutions in the United States 21,168 23,%1 23,235 19,716 26,572 20,374 23,788 20,081 21,049 53 Banks in foreign countries 7,295 6,778 7,058 6,429 7,138 6,068 6,050 6,583 6,250 54 Foreign governments and official institutions 716 843 786 746 738 621 592 781 618 55 Certified and officers' checks 9,796 9,205 8,556 8,171 10,290 9,192 8,655 8,131 9,066 56 Transaction balances other than demand deposits 77,407 76,476 75,992 74,792 77,424 77,648 77,533 76,872 76,012 57 Nontransaction balances 691,326 692,210 699,513' 700,134' 702,217 702,165 705,265 703,451 703,876 58 Individuals, partnerships, and corporations 653,075 653,825 661,464' 661,600' 664,417 664,475 667,393 665,702 665,907 59 States and political subdivisions 29,689 29,859 29,737 29,988 29,253 29,204 29,467 29,335 29,420 60 U.S. government 865 938 928 932 944 946 940 949 944 61 Depository institutions in the United States 7,040 6,943 6,762 6,989 6,999 6,923 6,886 6,890 7,037 62 Foreign governments, official institutions, and banks .. 656 643 622 626 604 617 579 574 569 63 Liabilities for borrowed money 299,212 298,772 301,665' 300,265' 324,064 303,615 308,670 297,894 310,669 64 Borrowings from Federal Reserve Banks 3,040 70 30 0 0 0 1,150 0 899 65 Treasury tax-and-loan notes 11,838 11,530 10,228 14,321 24,403 2,520 3,232 7,613 9,607 66 All other liabilities for borrowed money 284,334 287,172 291,407' 285,944' 299,661 301,095 304,288 290,280 300,164 67 Other liabilities and subordinated notes and debentures .. 86,169 82,906 84,423 87,028 90,280 87,485 89,176 90,688 90,997 68 Total liabilities 1,386,632 1,388,888 1,394,884' 1,378,691' 1,441,444 1,393,022 1,423,713 1,396,268 1,404,928 69 Residual (total assets minus total liabilities)7 97,016 97,262 97,952 97,861 98,423 98,417 98,263 98,798 98,871 MEMO 70 Total loans and leases (gross) and investments adjusted . 1,204,906 1,211,340 1,218,415' 1,217,948' 1,233,040 1,221,831 1,230,667 1,227,388 1,226,134 71 Total loans and leases (gross) adjusted 981,869 985,073 987,889' 985,531' 999,773 988,349 994,408 992,186 992,266 72 Time deposits in amounts of $100,000 or more 218,333 217,843 218,983 220,418 218,032 218,739 218,338 218,219 217,748 73 U.S. Treasury securities maturing in one year or less 16,630 17,562 17,394' 17,790' 18,413 18,288 17,957 17,594 17,100 74 Loans sold outright to affiliates—total 1,510 1,277 1,471' 1,575' 1,526 1,523 1,126 829 536 75 Commercial and industrial 1,198 977 1,171' 1,265' 1,226 1,221 825 525 231 76 Other 312 300 300' 310r 300 302 301 304 305 77 Nontransaction savings deposits (including MMDAs) 258,009 258,652 259,762 259,460 264,644 264,324 266,525 265,355 265,832 1. Beginning Jan. 6, 1988, the "Large bank" reporting group was revised 6. Includes federal funds purchased and securities sold under agreements to somewhat, eliminating some former reporters with less than $2 billion of assets repurchase; for information on these liabilities at banks with assets of $1 billion or and adding some new reporters with assets greater than $3 billion. more on Dec. 31, 1977, see table 1.13. 2. For adjustment bank data see this table in the March 1989 Bulletin. The 7. This is not a measure of equity capital for use in capital-adequacy analysis or adjustment data for 1988 should be added to the reported data for 1988 to establish for other analytic uses. comparability with data reported for 1989. 8. Exclusive of loans and federal funds transactions with domestic commercial 3. Includes U.S. government-issued or guaranteed certificates of participation banks. in pools of residential mortgages. 9. Loans sold are those sold outright to a bank's own foreign branches, 4. Includes securities purchased under agreements to rese". nonconsolidated nonbank affiliates of the bank, the bank's holding company (if 5. Includes allocated transfer risk reserve. not a bank), and nonconsolidated nonbank subsidiaries of the holding company. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 DomesticN onfinancial Statistics • February 1990 1.28 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY1 Millions of dollars, Wednesday figures Account Oct. 4 Oct. 11 Oct. 18 Oct. 25 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 1 Cash balances due from depository institutions 30,552 26,926 27,270 24,144 34,938 25,318 24,768 21,833 28,750 2 Total loans, leases, and securities, net2 213,517 211,371 213,066 210,064 222,339 207,756 220,795 209,742 212,537 Securities 3 U.S. Treasury and government agency3 0 0 0 0 0 0 0 0 0 4 Trading account 0 0 0 0 0 0 0 0 0 5 Investment account 14,900 15,117 15,527 15,793 15,927 15,890 15,718 16,173 16,100 6 Mortgage-backed securities4 7,662 7,766 8,132 8,420 8,442 8,447 8,376 8,627 8,534 All other maturing in 7 One year or less 2,628 2,722 2,685 2,712 2,836 2,844 2,849 2,858 2,831 8 Over one through five years 3,260 3,244 3,299 3,252 3,241 3,271 3,176 3,403 3,301 9 Over five years 1,350 1,384 1,411 1,409 1,408 1,326 1,316 1,284 1,434 10 Other securities3 0 0 0 0 0 0 0 0 0 11 Trading account 0 0 0 0 0 0 0 0 0 12 Investment account 16,771 16,791 16,592 16,080 15,312 15,032 15,092 15,056 14,846 13 States and political subdivisions, by maturity 9,761 9,809 9,729 9,101 8,403 8,120 8,057 8,020 7,988 14 One year or less 1,090 1,092 1,081 1,067 1,061 1,046 1,051 1,052 1,049 15 Over one year 8,671 8,717 8,648 8,034 7,343 7,074 7,006 6,%9 6,940 16 Other bonds, corporate stocks, and securities 7,010 6,982 6,863 6,978 6,908 6,912 7,035 7,036 6,858 17 Other trading account assets 0 0 0 0 0 0 0 0 0 Loans and leases 18 Federal funds sold5 20,567 16,055 17,797 15,519 25,543 17,730 27,450 16,640 19,788 19 To commercial banks 12,776 7,447 7,910 6,700 13,429 9,001 16,294 8,473 12,046 20 To nonbank brokers and dealers in securities 3,926 4,548 6,236 5,295 6,2% 4,919 6,104 5,077 4,600 21 To others 3,865 4,059 3,651 3,524 5,818 3,811 5,052 3,089 3,143 22 Other loans and leases, gross 180,904 183,532 183,281 182,810 185,571 179,133 182,583 181,982 181,873 23 Other loans, gross 175,246 177,880 177,546 177,085 179,860 173,458 176,911 176,269 176,168 24 Commercial and industrial 58,977 60,963 60,592 60,476 61,631 60,418 61,406 60,506 60,040 25 Bankers acceptances and commercial paper 562 499 529 600 165 160 151 136 131 26 Mother 58,416 60,464 60,063 59,876 61,466 60,259 61,255 60,371 59,909 27 U.S. addressees 57,844 59,776 59,339 59,269 60,764 59,620 60,473 59,795 59,332 28 Non-U.S. addressees 572 688 724 607 702 639 782 576 578 29 Real estate loans 59,259 59,363 59,658 59,520 59,768 59,939 59,925 60,099 60,309 30 Revolving, home equity 3,729 3,765 3,776 3,788 3,798 3,809 3,810 3,828 3,835 31 Mother 55,530 55,598 55,881 55,731 55,970 56,130 56,115 56,270 56,474 32 To individuals for personal expenditures 19,947 19,955 20,028 20,006 20,055 20,139 20,150 20,168 20,148 33 To depository and financial institutions 19,485 20,132 19,472 19,247 19,624 16,926 18,481 18,256 18,188 34 Commercial banks in the United States 8,541 8,628 8,489 7,983 8,082 5,901 7,380 7,391 6,954 35 Banks in foreign countries 3,524 4,002 3,673 3,862 3,777 3,357 3,382 3,239 3,127 36 Nonbank depository and other financial institutions 7,419 7,501 7,311 7,402 7,765 7,668 7,720 7,626 8,108 37 For purchasing and carrying securities 6,257 5,874 6,660 6,923 7,069 5,516 6,366 6,857 6,404 38 To finance agricultural production 159 153 145 134 122 114 113 102 103 39 To states and political subdivisions 5,942 5,7% 5,776 6,010 5,969 5,961 5,695 5,565 5,555 40 To foreign governments and official institutions 481 468 427 330 384 412 425 339 382 41 Mother 4,738 5,176 4,788 4,440 5,238 4,032 4,350 4,377 5,037 42 Lease financing receivables 5,658 5,651 5,735 5,726 5,711 5,676 5,672 5,714 5,705 43 LESS: Unearned income 1,749 1,753 1,762 1,758 1,738 1,759 1,757 1,820 1,791 44 Loan and lease reserve 17,876 18,370 18,368 18,381 18,275 18,271 18,290 18,290 18,280 45 Other loans and leases, net6 161,279 163,408 163,150 162,672 165,558 159,103 162,536 161,873 161,802 46 All other assets7 52,525 53,628 56,913 56,399 60,546 61,507 62,540 59,368 59,680 47 Total assets 296,595 291,924 297,249 290,607 317,824 294,581 308,103 290,943 300,966 Deposits 48 Demand deposits 53,632 55,395 54,149 49,626 61,956 51,659 56,515 50,289 50,743 49 Individuals, partnerships, and corporations 36,592 39,689 37,565 34,971 41,668 35,810 40,130 35,858 34,999 50 States and political subdivisions 747 728 587 536 956 582 %5 635 493 51 U.S. government 1,085 255 776 351 170 626 715 604 326 52 Depository institutions in the United States 4,594 4,844 5,928 5,209 8,798 5,028 6,800 4,114 5,920 53 Banks in foreign countries 6,000 5,520 5,588 5,082 5,849 4,941 4,675 5,413 4,944 54 Foreign governments and official institutions 571 682 609 601 554 458 453 646 468 55 Certified and officers' checks 4,044 3,675 3,0% 2,874 3,%2 4,213 2,777 3,018 3,593 56 Transaction balances other than demand deposits (ATS, NOW, Super NOW, telephone transfers) 8,422 8,367 8,219 8,077 8,255 8,305 8,361 8,252 8,205 57 Nontransaction balances 113,952 112,870 113,540 113,590 115,441 113,697 116,677 115,318 115,313 58 Individuals, partnerships, and corporations 103,989 102,880 103,703 103,538 105,718 104,048 106,976 105,704 105,701 59 States and political subdivisions 7,422 7,472 7,494 7,647 7,388 7,274 7,353 7,281 7,292 60 U.S. government 29 29 29 29 29 29 30 29 29 61 Depository institutions in the United States 2,228 2,214 2,047 2,103 2,034 2,074 2,062 2,051 2,041 62 Foreign governments, official institutions, and banks ... 284 273 266 273 271 273 256 252 249 63 Liabilities for borrowed money 67,632 65,559 70,695 66,232 75,784 67,473 72,910 62,029 69,940 64 Borrowings from Federal Reserve Banks 3,010 0 0 0 0 0 1,150 0 883 65 Treasury tax-and-loan notes 2,484 2,338 1,856 2,939 5,684 422 604 1,465 1,878 66 All other liabilities for borrowed money 62,138 63,221 68,839 63,292 70,100 67,050 71,157 60,564 67,179 67 Other liabilities and subordinated notes and debentures ... 29,552 26,384 26,472 28,891 32,327 29,333 29,622 30,619 32,460 68 Total liabilities 273,190 268,574 273,076 266,415 293,763 270,467 284,085 266,507 276,662 69 Residual (total assets minus total liabilities)9 23,405 23,350 24,174 24,192 24,060 24,114 24,018 24,436 24,305 MEMO 70 Total loans and leases (gross) and investments adjusted2,10 211,825 215,419 216,798 215,520 220,842 212,884 217,169 213,987 213,608 71 Total loans and leases (gross) adjusted 180,154 183,511 184,678 183,646 189,604 181,962 186,359 182,758 182,662 72 Time deposits in amounts of $100,000 or more 42,655 41,931 42,246 42,378 42,444 41,933 42,576 41,804 41,576 73 U.S. Treasury securities maturing in one year or less 2,456 3,005 2,937 2,987 3,353 3,005 2,904 2,990 2,970 1. These data also appear in the Board's H.4.2 (504) release. For address, see 7. Includes trading account securities. inside front cover. 8. Includes federal funds purchased and securities sold under agreements to 2. Excludes trading account securities. repurchase. 3. Not available due to confidentiality. 9. Not a measure of equity capital for use in capital adequacy analysis or for 4. Includes U.S. government-issued or guaranteed certificates of participation other analytic uses. in pools of residential mortgages. 10. Exclusive of loans and federal funds transactions with domestic commer- 5. Includes securities purchased under agreements to resell. cial banks. Digitized for FRA6.S IEncRlu des allocated transfer risk reserve. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Commercial Banks A21 1.30 LARGE WEEKLY REPORTING U.S. BRANCHES AND AGENCIES OF FOREIGN BANKS1 Assets and Liabilities Millions of dollars, Wednesday figures 1989 AAccccoouunntt Oct. 4R Oct. llr Oct. 18' Oct. 25' Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 1 Cash and due from depository institutions ... 12,441 11,639 12,739 11,626 12,734 12,080 12,983 12,064 13,503 2 Total loans and securities 135,837 135,385 139,0% 136,151 137,834 139,655 140,684 141,024 147,492 3 U.S. Treasury and government agency securities 7,330 7,458 8,138 8,122 8,167 8,237 88,,226688 88,,336677 88,,999977 4 Other securities 5,955 5,965 5,954 6,114 6,159 6,204 6,347 6,423 6,577 5 Federal funds sold 6,479 5,908 7,348 4,459 4,441 5,321 4,9% 4,865 8,630 6 To commercial banks in the United States. 5,062 4,484 5,730 2,966 3,049 3,985 3,338 3,349 6,978 7 To others 1,417 1,424 1,618 1,493 1,392 1,336 1,658 1,516 1,652 8 Other loans, gross 116,073 116,054 117,656 117,456 119,067 119,893 121,073 121,369 123,288 9 Commercial and industrial 7733,,880011 73,138 74,290 73,777 74,366 75,074 74,987 75,917 75,544 10 Bankers acceptances and commercial paper 2,247 2,492 2,393 2,387 2,329 2,129 2,032 2,328 2,399 11 All other 71,554 70,646 71,897 71,390 72,037 72,945 72,955 73,589 73,145 12 U.S. addressees 69,772 68,876 70,006 69,547 70,117 71,1% 71,224 71,838 71,462 13 Non-U.S. addressees 1,782 1,770 1,891 1,843 1,920 1,749 1,731 1,751 1,683 14 Loans secured by real estate3 16,231 16,309 16,289 16,981 17,426 17,379 17,753 17,643 18,077 15 To financial institutions 21,271 21,912 22,229 22,198 22,630 23,280 23,168 23,366 24,397 16 Commercial banks in the United States.. 16,159 16,490 16,480 16,530 16,968 16,868 17,313 17,494 18,248 17 Banks in foreign countries 1,195 1,370 1,635 1,482 1,410 1,521 1,324 1,343 1,564 18 Nonbank financial institutions 3,917 4,052 4,114 4,186 4,252 4,891 4,531 4,529 4,585 19 To foreign governments and official institutions 643 541 505 500 489 374 373 384 382 20 For purchasing and carrying securities 1,810 1,909 2,111 1,629 1,627 1,472 2,306 1,722 2,317 21 Mother3 2,317 2,245 2,232 2,371 2,529 2,314 2,486 2,337 2,571 22 Other assets (claims on nonrelated parties) .. 36,027 36,858 36,552 36,633 36,183 36,501 36,571 36,601 36,759 23 Net due from related institutions 15,734 16,567 13,691 16,732 20,307 15,348 16,029 16,425 11,540 24 Total assets 200,037 200,450 202,079 201,141 207,059 203,584 206,268 206,113 209,295 25 Deposits or credit balances due to other than directly related institutions —.. 50,346 49,744 50,642 50,917 51,313 50,944 52,887 50,359 50,030 26 Transaction accounts and credit balances4 . 3,937 3,427 3,586 3,881 4,483 3,772 4,918 3,757 4,200 27 Individuals, partnerships, and corporations 2,227 2,330 2,302 2,288 2,531 2,250 2,635 2,661 2,438 28 Other 1,710 1,097 1,284 1,593 1,952 1,522 2,283 1,096 1,762 29 Nontransaction accounts 46,409 46,317 47,056 47,036 46,830 47,172 47,%9 46,602 45,830 30 Individuals, partnerships, and corporations 38,677 38,741 38,944 39,102 39,018 39,026 39,184 38,828 38,706 31 Other 7,732 7,576 8,112 7,934 7,812 8,146 8,785 7,774 7,124 32 Borrowings from other than directly related institutions 88,183 86,934 85,6% 87,675 %,525 90,730 92,556 92,251 90,328 33 Federal funds purchased 40,525 39,415 38,918 39,913 46,988 40,454 42,500 37,192 38,944 34 From commercial banks in the United States 20,471 20,401 19,459 19,698 25,390 21,168 25,151 18,392 19,078 35 From others 20,054 19,014 19,459 20,215 21,598 19,286 17,349 18,800 19,866 36 Other liabilities for borrowed money 47,658 47,519 46,778 47,762 49,537 50,276 50,056 55,059 51,384 37 To commercial banks in the United States 31,059 30,678 30,307 31,252 32,411 32,698 32,588 35,040 33,158 38 To others 16,599 16,841 16,471 16,510 17,126 17,578 17,468 20,019 18,226 39 Other liabilities to nonrelated parties 36,653 36,517 36,959 36,426 36,260 36,141 37,070 37,114 37,128 40 Net due to related institutions 24,856 27,255 28,783 26,122 22,%2 25,769 23,754 26,387 31,808 41 Total liabilities 200,037 200,450 202,079 201,141 207,059 203,584 206,268 206,113 209,295 MEMO 42 Total loans (gross) and seciuities adjusted7 .. 114,616 114,411 116,886 116,655 117,817 118,802 120,033 120,181 122,266 43 Total loans (gross) adjusted 101,331 100,988 102,794 102,419 103,491 104,361 105,418 105,391 106,692 1. Effective Jan. 4,1989, the reporting panel includes a new group of large U.S. separate component of Other loans, gross. Formerly, these loans were included in branches and agencies of foreign banks. Earlier data included 65 U.S. branches "All other", line 21. and agencies of foreign banks that included those branches and agencies with 4. Includes credit balances, demand deposits, and other checkable deposits. assets of $750 million or more on June 30,1980, plus those branches and agencies 5. Includes savings deposits, money market deposit accounts, and time that had reached the $750 million asset level on Dec. 31, 1984. These data also deposits. appear in the Board's H.4.2 (504) release. For address, see inside front cover. 6. Includes securities sold under agreements to repurchase. 2. Includes securities purchased under agreements to resell. 7. Exclusive of loans to and federal funds sold to commercial banks in the 3. Effective Jan. 4, 1989, loans secured by real estate are being reported as a United States. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 DomesticN onfinancial Statistics • February 1990 1.31 GROSS DEMAND DEPOSITS Individuals, Partnerships, and Corporations1 Billions of dollars, estimated daily-average balances, not seasonally adjusted Commercial banks TTyyppee ooff hhoollddeerr 1988 1989 11998844 11998855 11998866 11998877 DDeecc.. DDeecc.. DDeecc.. DDeecc.. June Sept. Dec. Mar. June Sept. 1 AU holders—Individuals, partnerships, and corporations 302.7 321.0 363.6 343.5 346.5 337.8 354.7 330.4 329.3 f 2 Financial business 31.7 32.3 41.4 36.3 37.2 34.8 38.6 36.3 33.0 1 3 Nonfinancial business 166.3 178.5 202.0 191.9 194.3 190.3 201.2 182.2 185.9 n.a. 4 Consumer 81.5 85.5 91.1 90.0 89.8 87.8 88.3 87.4 86.6 1 5 Foreign 3.6 3.5 3.3 3.4 3.4 3.2 3.7 3.7 2.9 1 6 Other 19.7 21.2 25.8 21.9 21.9 21.7 22.8 20.7 21.0 1 Weekly reporting banks 1988 1989 11998844 11998855 11998866 11998877 DDeecc.. DDeecc.. DDeecc.. DDeecc.. June Sept. Dec. Mar. June Sept. 7 All holders—Individuals, partnerships, and corporations 157.1 168.6 195.1 183.8 191.5 185.3 198.3 181.9 182.2 186.6 8 Financial business 25.3 25.9 32.5 28.6 30.0 27.2 30.5 27.2 25.4 26.3 9 Nonfinancial business 87.1 94.5 106.4 100.0 103.1 101.5 108.7 98.6 99.8 101.6 10 Consumer 30.5 33.2 37.5 39.1 42.3 41.8 42.6 41.1 42.4 43.0 11 Foreign 3.4 3.1 3.3 3.3 3.4 3.1 3.6 3.3 2.9 2.8 12 Other 10.9 12.0 15.4 12.7 12.8 11.7 12.9 11.7 11.7 12.9 1. Figures include cash items in process of collection. Estimates of gross 4. Historical data back to March 1985 have been revised to account for deposits are based on reports supplied by a sample of commercial banks. Types corrections of bank reporting errors. Historical data before March 1985 have not of depositors in each category are described in the June 1971 Bulletin, p. 466. been revised, and may contain reporting errors. Data for all commercial banks for Figures may not add to totals because of rounding. March 1985 were revised as follows (in billions of dollars): all holders, -.3; 2. Beginning in March 1984, these data reflect a change in the panel of weekly financial business, -.8; nonfinancial business, -.4; consumer, .9; foreign, .1; reporting banks, and are not comparable to earlier data. Estimates in billions of other, -.1. Data for weekly reporting banks for March 1985 were revised as dollars for December 1983 based on the new weekly reporting panel are: financial follows (in billions of dollars): all holders, -.1; financial business, —.7; nonfinanbusiness, 24.4; nonfinancial business, 80.9; consumer, 30.1; foreign, 3.1; other cial business, -.5; consumer, 1.1; foreign, .1; other, -.2. 9.5. 5. Beginning March 1988, these data reflect a change in the panel of weekly 3. Beginning March 1985, financial business deposits and, by implication, total reporting banks, and are not comparable to earlier data. Estimates in billions of gross demand deposits have been redefined to exclude demand deposits due to dollars for December 1987 based on the new weekly reporting panel are: financial thrift institutions. Historical data have not been revised. The estimated volume of business, 29.4; nonfinancial business, 105.1; consumer, 41.1; foreign, 3.4; other, such deposits for December 1984 is $5.0 billion at all insured commercial banks 13.1. and $3.0 billion at weekly reporting banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A23 1.32 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING Millions of dollars, end of period 1989 ¥ 1984 1985 1986 1987 1988 Dec. Dec. Dec. Dec. Dec. May June July Aug. Sept. Oct. Commercial paper (seasonally adjusted unless noted otherwise) 1 All issuers 237,586 298,779 329,991 357,129 455,017 497,369 503,445 506,095 516,476 507,090' 507,902 Financial companies1 Dealer-placed paper 2 Total 56,485 78,443 101,072 101,958 115599,,994477 116677,,779955 167,681 179,354 118833,,999922'' 117799,,0055CC 117777,,771133 3 Bank-related (not seasonally adjusted) 2,035 1,602 2,265 1,428 1,248 n.a. n.a. n.a. n.a. n.a. n.a. Directly placed paper 4 Total 111100,,554433 135,320 151,820 117733,,993399 119922,,444422 220066,,449977 221111,,002200 220055,,884477 220088,,991155 220066,,552211 221100,,885555 5 Bank-related (not seasonally adjusted) ^ 42,105 44,778 40,860 43,173 43,155 n.a. n.a. n.a. n.a. n.a. n.a. 6 Nonfinancial companies 70,558 85,016 77,099 81,232 102,628 123,077 124,744 121,217 125,478 123,489' 121,466 Bankers dollar acceptances (not seasonally adjusted)6 7 Total 78,364 68,413 64,974 70,565 66,631 62,396 64,115 65,588 65,764 63,813 63,660 Holder 8 Accepting banks 9,811 11,197 13,423 10,943 9,086 8,908 9,417 9,355 9,844 9,656 10,811 9 Own bills 8,621 9,471 11,707 9,464 8,022 8,115 8,371 8,279 8,783 8,922 9,108 10 Bills bought 11,,119911 1,726 1,716 1,479 11,,006644 794 1,046 1,076 11,,006611 735 11,,770033 Federal Reserve Banks 11 Own account 0 0 0 0 0 0 0 0 0 0 0 12 Foreign correspondents 671 937 1,317 965 1,493 1,374 1,177 1,026 1,014 1,016 1,016 13 Others 67,881 56,279 50,234 58,658 56,052 52,113 53,521 55,207 54,906 53,370 51,833 Basis 14 Imports into United States 17,845 15,147 14,670 16,483 14,984 14,900 15,093 15,338 16,140 16,265 16,157 15 Exports from United States 16,305 13,204 12,960 15,227 14,410 14,452 15,063 15,270 14,895 14,322 14,275 16 All other 44,214 40,062 37,344 38,855 37,237 33,044 33,959 34,980 34,729 33,455 33,228 1. Institutions engaged primarily in activities such as, but not limited to, 5. Includes public utilities and firms engaged primarily in such activities as commercial savings, and mortgage banking; sales, personal, and mortgage fi- communications, construction, manufacturing, mining, wholesale and retail trade, nancing; factoring, finance leasing, and other business lending; insurance under- transportation, and services. writing; and other investment activities. 6. Beginning January 1988, the number of respondents in the bankers accep- 2. Includes all financial company paper sold by dealers in the open market. tance survey were reduced from 155 to 111 institutions—those with $100 million 3. Beginning January 1989, bank-related series have been discontinued. or more in total acceptances. The new reporting group accounts for over 90 4. As reported by financial companies that place their paper directly with percent of total acceptances activity. investors. 1.33 PRIME RATE CHARGED BY BANKS on Short-Term Business Loans Percent per year Date of change Rate Period Av r e a r te a ge Period Av r e a r te a ge Period 1987— Apr. 1 7.75 1987 8.21 1988— Jan. 8.75 1989—Jan. ... May 1 8.00 1988 9.32 Feb. 8.51 Feb. . 15 8.25 1989 n.a. Mar. 8.50 Mar. . Sept.4 .. 8.75 Apr. 8.50 Apr. . Oct. 7 9.25 1987— Jan. 7.50 May 8.84 May .. 22 9.00 Feb. 7.50 June 9.00 June . Nov. 5 8.75 Mar. 7.50 July 9.29 July ... Apr. 7.75 Aug. 9.84 Aug. .. 1988— Feb. 2 8.50 May 8.14 Sept. 10.00 Sept. .. May 11 9.00 June 8.25 Oct. 10.00 Oct. ... July 14 9.50 July 8.25 Nov. 10.05 Nov. .. Aug. 11 10.00 Aug. 8.25 Dec. 10.50 Dec. Nov. 28 10.50 Sept. 8.70 Oct. 9.07 1989—Feb. 10 11.00 Nov. 8.78 24 11.50 Dec. 8.75 June 5 11.00 July 31 10.50 NOTE. These data also appear in the Board's H. 15 (519) and G. 13 (415) releases. For address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 DomesticN onfinancial Statistics • February 1990 1.35 INTEREST RATES Money and Capital Markets Averages, percent per year; weekly, monthly and annual figures are averages of business day data unless otherwise noted. 1989 1989, week ending Instrument 11998866 11998877 11998888 Aug. Sept. Oct. Nov. Oct. 27 Nov. 3 Nov. 10 Nov. 17 MONEY MARKET RATES 1 Federal funds1'2 6.80 6.66 7.57 8.99 9.02 8.84 8.55 8.72 8.80 8.69 8.46 2 Discount window borrowing1, 3 6.32 5.66 6.20 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 Commercial paper • 3 1-month 6.61 6.74 7.58 8.79 8.87 8.66 8.47 8.55 8.63 8.53 8.43 4 3-month 6.49 6.82 7.66 8.57 8.70 8.53 8.35 8.42 8.49 8.44 8.33 5 6-month 6.39 6.85 7.68 8.32 8.50 8.24 8.00 8.07 8.12 8.07 7.98 Finance paper, directly placed4, 6 1-month 6.57 6.61 7.44 8.67 8.76 8.54 8.33 8.45 8.51 8.41 8.31 7 3-month 6.38 6.54 7.38 8.20 8.35 8.29 8.07 8.14 8.15 8.13 8.09 8 6-month 6.31 6.37 7.14 7.49 7.56 7.50 7.45 7.47 7.44 7.51 7.52 Bankers acceptances ,6 9 3-month 6.38 6.75 7.56 8.47 8.59 8.42 8.21 8.32 8.34 8.29 8.18 10 6-month 6.28 6.78 7.60 8.22 8.37 8.08 7.86 7.92 7.99 7.96 7.81 Certificates of deposit, secondary market7 11 1-month 6.61 6.75 7.59 8.77 8.83 8.62 8.44 8.54 8.58 8.50 8.40 12 3-month 6.51 6.87 7.73 8.64 8.78 8.60 8.39 8.49 8.53 8.48 8.36 13 6-month 6.50 7.01 7.91 8.56 8.75 8.45 8.21 8.29 8.33 8.32 8.18 14 Eurodollar deposits^ 3-month8 6.70 7.07 7.85 8.71 8.85 8.67 8.42 8.58 8.56 8.60 8.43 U.S. Treasury bills Secondary market9 15 3-month 5.97 5.78 6.67 7.90 7.75 7.64 7.69 7.60 7.77 7.74 7.67 16 6-month 6.02 6.03 6.91 7.74 7.74 7.62 7.49 7.50 7.58 7.59 7.45 17 1-year 6.07 6.33 7.13 7.61 7.65 7.45 7.25 7.28 7.35 7.35 7.21 Auction average10 18 3-month 5.98 5.82 6.68 7.91 7.72 7.63r 7.65 7.52 7.78 7.67 7.68 19 6-month 6.03 6.05 6.92 7.72 7.74 7.61 7.46 7.50 7.62 7.49 7.51 20 1-year 6.07 6.33 7.17 7.45 7.61 7.35 7.17 7.35 n.a. n.a. n.a. CAPITAL MARKET RATES U.S. Treasury notes and bonds11 Constant maturities 21 1-year 6.45 6.77 7.65 8.18 8.22 7.99 7.77 7.81 7.89 7.87 7.71 22 2-year 6.86 7.42 8.10 8.14 8.28 7.98 7.80 7.81 7.88 7.86 7.75 23 3-year 7.06 7.68 8.26 8.13 8.26 8.02 7.80 7.86 7.92 7.89 7.74 24 5-year 7.30 7.94 8.47 8.09 8.17 7.97 7.81 7.83 7.86 7.87 7.79 25 7-year 7.54 8.23 8.71 8.11 8.23 8.03 7.86 7.90 7.91 7.89 7.84 26 10-year 7.67 8.39 8.85 8.11 8.19 8.01 7.87 7.89 7.92 7.92 7.86 27 20-year 7.84 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 28 30-year 7.78 8.59 8.96 8.12 8.15 8.00 7.90 7.91 7.91 7.91 7.89 Composite 29 Over 10 years (long-term) 8.14 8.64 8.98 8.26 8.31 8.15 8.03 8.05 8.04 8.03 8.02 State and local notes and bonds Moody's series14 30 Aaa 6.95 7.14 7.36 6.67 6.97 6.93 6.77 6.90 7.00 6.80 6.70 31 Baa 7.76 8.17 7.83 7.03 7.26 7.33 7.16 7.35 7.32 7.25 7.25 32 Bond Buyer series15 7.32 7.63 7.68 7.06 7.26 7.22 7.14 7.22 7.24 7.20 7.12 Corporate bonds Seasoned issues16 33 All industries 9.71 9.91 10.18 9.36 9.41 9.34 9.32 9.29 9.32 9.32 9.31 34 Aaa 9.02 9.38 9.71 8.96 9.01 8.92 8.89 8.85 8.91 8.90 8.86 35 Aa 9.47 9.68 9.94 9.14 9.23 9.19 9.14 9.14 9.16 9.15 9.12 36 A 9.95 9.99 10.24 9.45 9.51 9.44 9.42 9.41 9.44 9.44 9.41 37 Baa 10.39 10.58 10.83 9.88 9.91 9.81 9.81 9.75 9.77 9.80 9.82 38 A-rated, recently offered utility bonds17 9.61 9.96 10.20 9.55 9.55 9.39 9.28 9.39 9.29 9.27 9.31 MEMO: Dividend/price ratio18 39 Preferred stocks 8.76 8.37 9.23 8.75 8.82 8.85 8.73 8.79 8.77 8.72 8.74 40 Common stocks 3.48 3.08 3.64 3.28 3.29 3.29 3.39 3.36 3.38 3.41 3.39 1. Weekly, monthly and annual figures are averages of al) calendar days, places. Thus, average issuing rates in bill auctions will be reported using two where the rate for a weekend or holiday is taken to be the rate prevailing on the rather than three decimal places. preceding business day. The daily rate is the average of the rates on a given day 11. Yields are based on closing bid prices quoted by at least five dealers. weighted by the volume of transactions at these rates. 12. Yields adjusted to constant maturities by the U.S. Treasury. That is, yields 2. Weekly figures are averages for statement week ending Wednesday. are read from a yield curve at fixed maturities. Based on only recently issued, 3. Rate for the Federal Reserve Bank of New York. actively traded securities. 4. Unweighted average of offering rates quoted by at least five dealers (in the 13. Averages (to maturity or call) for all outstanding bonds neither due nor case of commercial paper), or finance companies (in the case of finance paper). callable in less than 10 years, including one very low yielding "flower" bond. Before November 1979, maturities for data shown are 30-59 days, 90-119 days, 14. General obligations based on Thursday figures; Moody's Investors Service. and 120-179 days for commercial paper; and 30-59 days, 90-119 days, and 15. General obligations only, with 20 years to maturity, issued by 20 state and 150-179 days for finance paper. local governmental units of mixed quality. Based on figures for Thursday. 5. Yields are quoted on a bank-discount basis, rather than in an investment 16. Daily figures from Moody's Investors Service. Based on yields to maturity yield basis (which would give a higher figure). on selected long-term bonds. 6. Dealer closing offered rates for top-rated banks. Most representative rate 17. Compilation of the Federal Reserve. This series is an estimate of the yield (which may be, but need not be, the average of the rates quoted by the dealers). on recently-offered, A-rated utility bonds with a 30-year maturity and 5 years of 7. Unweighted average of offered rates quoted by at least five dealers early in call protection. Weekly data are based on Friday quotations. the day. 18. Standard and Poor's corporate series. Preferred stock ratio based on a 8. Calendar week average. For indication purposes only. sample of ten issues: four public utilities, four industrials, one financial, and one 9. Unweighted average of closing bid rates quoted by at least five dealers. transportation. Common stock ratios on the 500 stocks in the price index. 10. Rates are recorded in the week in which bills are issued. Beginning with the NOTE. These data also appear in the Board's H. 15 (519) and G. 13 (415) releases. Treasury bill auction held on Apr. 18, 1983, bidders were required to state the For address, see inside front cover. percentage yield (on a bank discount basis) that they would accept to two decimal Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A25 1.36 STOCK MARKET Selected Statistics 1989 IInnddiiccaattoorr 11998866 11998877 11998888 Mar. Apr. May June July Aug. Sept. Oct. Nov. Prices and trading (averages of daily figures) Common stock prices 1 New York Stock Exchange (Dec. 31, 1965 = 50) 136.03 161.78 149.97 164.56 169.38 175.30 180.76 185.15 192.93 193.02 192.49 188.50 2 Industrial 155.85 195.31 180.83 197.58 204.81 211.81 216.75 221.74 231.32 230.86 229.40 224.38 3 Transportation 119.87 140.52 134.09 153.85 164.32 169.05 173.47 179.32 197.53 202.02 190.36 174.26 4 Utility 71.36 74.29 72.22 87.16 79.69 84.21 87.95 90.40 92.90 93.44 94.67 94.95 5 Finance 147.19 146.48 127.41 146.14 143.26 146.82 154.08 157.78 164.86 165.51 166.55 160.89 6 Standard & Poor's Corporation (1941-43 = 10)1 236.39 287.00 265.88 292.71 302.25 313.93 323.73 331.92 346.61 347.33 347.40 340.22 7 American Stock Exchange (Aug. 31, 1973 = 50? 264.91 316.78 295.08 327.47 336.82 349.50 362.73 368.52 379.28 382.75 383.63 371.92 Volume of trading (thousands of shares) 8 New York Stock Exchange 141,020 188,922 161,386 159,024 161,863 171,495 180,680 162,501 171,683 151,752 182,394 144,389 9 American Stock Exchange 11,846 13,832 9,955 11,395 11,529 11,699 13,519 11,702 14,538 12,631 n.a. n.a. Customer financing (end-of-period balances, in millions of dollars) 10 Margin credit at broker-dealers3 36,840 31,990 32,740 32,130 32,610 33,140 34,730 34,360 33,940 35,020 35,110 34,630 Free credit balances at brokers4 11 Margin-account5 4,880 4,750 5,660 5,345 5,450 5,250 6,900 5,420 5,580 5,680 6,000 5,815 12 Cash-account 19,000 15,640 16,595 16,045 16,125 15,965 19,080 16,345 16,015 15,310 16,340 16,345 Margin requirements (percent of market value and effective date)6 Mar. 11, 1968 June i , 1968 May 6, 1970 Dec. 6, 1971 Nov. 24, 1972 Jan. 3, 1974 13 Margin stocks 70 80 65 55 65 50 14 Convertible bonds 50 60 50 50 50 50 15 Short sales 70 80 65 55 65 50 1. Effective July 1976, includes a new financial group, banks and insurance carry"margin securities" (as defined in the regulations) when such credit is companies. With this change the index includes 400 industrial stocks (formerly collateralized by securities. Margin requirements on securities other than options 425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and 40 are the difference between the market value (100 percent) and the maximum loan financial. value of collateral as prescribed by the Board. Regulation T was adopted effective 2. Beginning July 5, 1983, the American Stock Exchange rebased its index Oct. 15, 1934; Regulation U, effective May 1, 1936; Regulation G, effective Mar. effectively cutting previous readings in half. 11, 1968; and Regulation X, effective Nov. 1, 1971. 3. Beginning July 1983, under the revised Regulation T, margin credit at On Jan. 1, 1977, the Board of Governors for the first time established in broker-dealers includes credit extended against stocks, convertible bonds, stocks Regulation T the initial margin required for writing options on securities, setting acquired through exercise of subscription rights, corporate bonds, and govern- it at 30 percent of the current market-value of the stock underlying the option. On ment securities. Separate reporting of data for margin stocks, convertible bonds, Sept. 30, 1985, the Board changed the required initial margin, allowing it to be the and subscription issues was discontinued in April 1984. same as the option maintenance margin required by the appropriate exchange or 4. Free credit balances are in accounts with no unfulfilled commitments to the self-regulatory organization; such maintenance margin rules must be approved by brokers and are subject to withdrawal by customers on demand. the Securities and Exchange Commission. Effective Jan. 31, 1986, the SEC 5. New series beginning June 1984. approved new maintenance margin rules, permitting margins to be the price of the 6. These regulations, adopted by the Board of Governors pursuant to the option plus 15 percent of the market value of the stock underlying the option. Securities Exchange Act of 1934, limit the amount of credit to purchase and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A26 Domestic Nonfinancial Statistics • February 1990 1.37 SELECTED FINANCIAL INSTITUTIONS Selected Assets and Liabilities Millions of dollars, end of period 1988 1989 AAccccoouunntt 11998866 11998877 Dec. Jan. Feb. Mar. Apr. May June July' Aug. Sept. SAIF-insured institutions 1 Assets 1,163,851 1,250,855 1,350,500 1,337,382 1,339,115 1,340,502 1,345,36? 1,346,582' 1,338,557' 1,331,988 1,318,092' 1,302,066 2 Mortgages 697,451 721,593 764,513 767,260 767,603 769,398 773,383' 774,354' 772,695' 771,693 770,024' 764,718 3 Mortgage-backed securities 158,193 201,828 214,587 211,308 213,090 215,203 216,172' 216,298' 211,260' 204,311 195,252' 188,396 4 Contra-assets to mortgage assets1 . 41,799 42,344 37,950 37,157 37,013 37,842 37,790' 37,497 37,592' 37,210 36,77c 36,218 5 Commercial loans 23,683 23,163 33,889 32,974 32,955 32,866 32,807' 33,003' 33,094' 33,213 32,002' 32,886 6 Consumer loans 51,622 57,902 61,922 61,998 61,981 61,402 61,739 61,879 60,773' 61,074 60,976' 60,429 7 Contra-assets to nonmortgage loans . 3,041 3,467 3,056 2,840 2,923 3,074 2,896' 2,913' 3,145 3,165 3,127' 3,089 8 Cash and investment securities 164,844 169,717 186,986 178,813 177,178 177,094 175,895 174,293 175,281' 175,255 171,664' 169,754 9 Other3 112,898 122,462 129,610 125,026 126,243 125,455 126,053' 127,166' 126,191' 126,818 127,071' 125,190 10 Liabilities and net worth . 1,163,851 1,250,855 1,350,500 1,337,382 1,339,115 1,340,502 1,345,362' 1,346,582' 1,338,557' 1,331,988 1,318,092' 1,302,066 11 Savings capital 890,664 932,616 971,700 963,820 957,358 956,663 954,495 955,566 960,072' 963,158 960,284' 958,947 12 Borrowed money 196,929 249,917 299,400 299,415 305,675 312,988 318,669 318,369 312,062 301,581 289,631 281,474 13 FHLBB 100,025 116,363 134,168 135,712 140,089 146,007 148,000 146,520 144,217 141,875 138,331 133,633 14 Other 96,904 133,554 165,232 163,703 165,586 166,981 170,669 171,849 167,845 159,706 151,300 147,841 15 Other 23,975 21,941 24,216 29,751 31,749 29,593 31,642' 33,599 29,865' 31,889 33,802' 29,832 16 Net worth 52,282 46,382 55,185 58,882 58,962 57,113 56,085' 54,597' 52,725' 50,904 49,929' 48,036 SAIF-insured federal savings banks 17 Assets 210,562 284,270 425,983 423,846 432,675 443,167r 455,143' 469,939' 495,739' 507,007 504,175 501,136 18 Mortgages 113,638 161,926 227,869 234,591 238,415 241,076' 246,678' 253,886' 273,232' 281,562 282,006 279,698 19 Mortgage-backed securities 29,766 45,826 64,957 62,773 65,896 68,086' 69,964' 73,963' 73,943' 74,341 72,082 72,444 20 Contra-assets to mortgage assets1 . n.a. 9,100 13,140 12,258 12,685 12,896' 13,049' 13,227' 13,662' 13,972 13,859 13,814 21 Commercial loans n.a. 6,504 16,731 16,172 16,320 16,313' 16,498 16,935 18,014 18,280 18,169 18,195 22 Consumer loans 13,180 17,696 24,222 25,033 25,977 26,096' 26,767 27,956 28,157' 28,967 28,985 28,766 23 Contra-assets to nonmortgage loans . n.a. 678 889 814 857 977' 863 888' 976' 980 987 1,029 24 Finance leases plus interest n.a. 591 880 907 946 1,011 1,047 1,072 1,083 1,088 1,075 1,092 25 Cash and investment ... n.a. 35,347 61,029 57,434 57,986 60,272' 61,278' 62,002 65,778' 66,068 65,109 64,232 26 Other 19,034 24,069 35,428 33,954 34,664 34,964' 37,333' 38,021' 39,644' 40,327 40,521 40,680 27 Liabilities and net worth . 210,562 284,270 425,983 423,846 432,675 443,167' 455,143' 469,939' 495,739' 507,007 504,175 501,136 28 Savings capital 157,872 203,196 298,197 298,515 301,770 307,58c 315,725' 324,369 342,145' 352,547 352,099 353,462 29 Borrowed money 37,329 60,716 99,286 98,304 102,902 107,179' 110,004' 114,854' 121,895' 121,195 117,970 115,628 30 FHLBB 19,897 29,617 46,265 46,470 48,951 51,532 53,5^ 55,463' 58,505' 59,781 59,189 57,941 31 Other 17,432 31,099 53,021 51,834 53,951 55,647' 56,485 59,391 63,390 61,414 58,781 57,687 32 Other 4,263 5,324 8,075 8,270 8,884 8,649' 9,306' 10,174' 9,825' 10,697 11,443 9,905 33 Net worth 11,098 15,034 20,235 21,625 22,700 23,090' 23,404' 23,926' 25,677' 26,253 26,357 26,140 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A27 1.37—Continued 1988 1989 AAccccoouunntt 11998866 11998877 Dec. Jan. Feb. Mar. Apr. May June July' Aug. Sept. Credit unions5 34 Total assets/liabilities and capital 147,726 174,593 175,027 176,270 178,175 177,417 178,812 180,664 179,029 180,035 181,812 35 Federal 95,483 114,566 114,909 115,543 117,555 115,416 116,705 117,632 117,475 117,463 118,746 36 State 52,243 60,027 60,118 60,727 60,620 62,001 62,107 63,032 61,554 62,572 63,066 37 Loans outstanding 86,137 n a. 113,191 114,012 113,880 114,572 115,249 116,947 119,101 119,720 120,577 122,522 38 Federal 55,304 73,766 74,083 73,917 74,395 75,003 76,052 77,729 78,472 78,946 80,548 39 State 30,833 39,425 39,927 39,963 40,177 40,246 40,895 41,372 41,248 41,631 41,874 40 Savings 134,327 159,010 159,106 161,073 164,322 161,388 162,134 164,415 162,405 162,754 164,050 41 Federal 87,954 104,431 104,629 105,262 107,368 105,208 105,787 106,984 106,266 106,038 106,633 42 State 46,373 54,579 54,477 55,811 56,954 56,180 56,347 57,431 56,139 56,716 57,417 Life insurance companies 43 Assets 937,551 1,044,459 1,157,140 1,176,042 1,186,208 1,199,125 1,209,242 1,221,332 1,232,195 1,247,341 Securities 44 Government 84,640 84,426 84,051r 84,042 84,190 84,485 82,873 83,847 84,564 84,438 45 United States6 59,033 57,078 58,564r 58,473 58,509 58,417 57,127 57,790 57,817 57,698 46 State ami local 11,659 10,681 9,136' 8,918 8,817 8,860 8,911 8,953 9,036 9,061 47 Foreign 13,948 16,667 16,351' 16,651 16,864 17,208 16,835 17,104 17,711 17,679 48 Business n.a. n.a. 660,416 667,026 678,541 687,777 697,703 706,960 714,398 726,599 n.a. n.a. 49 Bonds 401,943 472,684 556,043' 560,385 571,365 579,232 587,889 595,500 601,786 606,686 50 Stocks n.a. n.a. 104,373 106,641 107,176 108,545 109,814 111,460 112,612 119,913 51 Mortgages 193,842 203,545 232,863' 232,941 233,556 234,632 235,312 236,651 237,444 237,865 52 Real estate 31,615 34,172 37,371' 37,453 37,603 37,842 37,976 38,598 38,190 38,622 53 Policy loans 54,055 53,626 54,236' 54,517 54,738 54,921 55,201 55,525 55,746 55,812 54 Other assets 80,592 89,586 93,358' 98,063 97,580 99,468 100,173 99,751 101,853 104,005 1. Contra-assets are credit-balance accounts that must be subtracted from the NOTE. FSLIC-insured institutions: Estimates by the FHLBB for all institutions corresponding gross asset categories to yield net asset levels. Contra-assets to insured by the FSLIC and based on the FHLBB thrift Financial Report. mortgage loans, contracts, and pass-through securities include loans in process, FSLIC-insured federal savings banks: Estimates by the FHLBB for federal unearned discounts and deferred loan fees, valuation allowances for mortgages savings banks insured by the FSLIC and based on the FHLBB thrift Financial "held for sale," and specific reserves and other valuation allowances. Report. 2. Contra-assets are credit-balance accounts that must be subtracted from the Savings banks: Estimates by the National Council of Savings Institutions for all corresponding gross asset categories to yield net asset levels. Contra-assets to savings banks in the United States and for FDIC-insured savings banks that have nonmortgage loans include loans in process, unearned discounts and deferred loan converted to federal savings banks. fees, and specific reserves and valuation allowances. Credit unions: Estimates by the National Credit Union Administration for 3. Holding of stock in Federal Home Loan Bank and Finance leases plus federally chartered and federally insured state-chartered credit unions serving interest are included in "Other" (line 9). natural persons. 4. Excludes checking, club, and school accounts. Life insurance companies: Estimates of the American Council of Life Insurance 5. Data include all federally insured credit unions, both federal and state for all life insurance companies in the United States. Annual figures are annualchartered, serving natural persons. statement asset values, with bonds carried on an amortized basis and stocks at 6. Direct and guaranteed obligations. Excludes federal agency issues not year-end market value. Adjustments for interest due and accrued and for guaranteed, which are shown in the table under "Business" securities. differences between market and book values are not made on each item separately 7. Issues of foreign governments and their subdivisions and bonds of the but are included, in total, in "other assets." International Bank for Reconstruction and Development. As of June 1989 Savings bank data are no longer available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic Financial Statistics • February 1990 1.38 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Calendar year FFFiiissscccaaalll FFFiiissscccaaalll FFFiiissscccaaalll TTTyyypppeee ooofff aaaccccccooouuunnnttt ooorrr ooopppeeerrraaatttiiiooonnn yyyeeeaaarrr yyyeeeaaarrr yyyeeeaaarrr 1989 111999888777 111999888888''' 111999888999 June July Aug. Sept. Oct. Nov. U.S. budget1 1 Receipts, total 854,143 908,166 990,789 108,249' 66,191' 76,161' 99,233 68,426 71,213 2 On-budget 640,741 666,675 727,123 84,043' 45,673' 57,156' 75,711 50,122 51,989 3 Off-budget 213,402 241,491 263,666 24,206 20,518 19,004 23,522 18,304 19,223 4 Outlays, total 1,003,804' 1,063,318 1,142,777' 100,460' 84,430' 98,31c 105,299' 94,515 100,172 5 On-budget 809,972' 860,626 931,556' 83,927' 66,624' 79,218' 86,548' 75,096 80,794 6 Off-budget 193,832 202,691 211,221 16,534 17,806 19,092 18,750 19,419 19,378 7 Surplus, or deficit (-), total -149,661' -155,151 -151,988' 7,789 -18,239 -22,150 -6,066' -26,089 -28,959 8 On-budget -169,23T -193,951 -204,433' 116 -20,951 -22,062 -10,837' -24,974 -28,804 9 Off-budget 19,570 38,800 52,445 7,673 2,712 -88 4,771 -1,115 -155 Source of financing (total) 10 Borrowing from the public . 151,717r 166,139 140,156' 1,098 -3,962 35,854 6,618' 36,690 19,790 11 Operating cash (decrease, or increase (-)), —5,052 -7,963 3,425 -11,649 21,564 -3,235 -15,589 -2,513 21,772 12 Other 2 2,996' -3,025 8,407' 2,762 636 -10,469 14,977' -8,088 -12,603 MEMO 13 Treasury operating balance (level, end of period) 36,436 44,398 40,973 43,713 22,149 25,384 40,973 43,486 21,715 14 Federal Reserve Banks 9,120 13,024 13,452 12,154 5,312 6,652 13,452 13,124 5,501 15 Tax and loan accounts 27,316 31,375 27,521 31,560 16,837 18,732 27,521 30,362 16,214 1. In accordance with the Balanced Budget and Emergency Deficit Control Act international monetary fund; other cash and monetary assets; accrued interest of 1985, all former off-budget entries are now presented on-budget. The Federal payable to the public; allocations of special drawing rights; deposit funds; Financing Bank (FFB) activities are now shown as separate accounts under the miscellaneous liability (including checks outstanding) and asset accounts; agencies that use the FFB to finance their programs. The act has also moved two seigniorage; increment on gold; net gain/loss for U.S. currency valuation adjustsocial security trust funds (Federal old-age survivors insurance and Federal ment; net gain/loss for IMF valuation adjustment; and profit on the sale of gold. disability insurance trust funds) off-budget. SOURCE. Monthly Treasury Statement of Receipts and Outlays of the U.S. 2. Includes SDRs; reserve position on the U.S. quota in the IMF; loans to Government and the Budget of the U.S. Government. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A29 1.39 U.S. BUDGET RECEIPTS AND OUTLAYS1 Millions of dollars Calendar year FFFiiissscccaaalll FFFiiissscccaaalll SSSooouuurrrccceee ooorrr tttyyypppeee yyyeeeaaarrr yyyeeeaaarrr 1987 1988 1989 111999888888 111999888999 H2 HI H2 HI Sept. Oct. Nov. RECEIPTS 1 All sources 908,166 990,789 421,525 475,724 449,394 527,574 99,233 68,426 71,213 2 Individual income taxes, net 401,181 445,690 192,575 207,659 200,300 233,572 45,026 35,493 34,448 3 Withheld 341,435 361,386 170,203 169,300 179,600 174,230 2288,,112200 32,751 34,439 4 Presidential Election Campaign Fund 33 32 4 28 4 28 11 0 0 5 Nonwithheld 132,199 154,839 31,223 101,614 29,880 121,563 18,943 3,684 1,459 6 Refunds 72,487 70,567 8,853 63,283 9,186 6622,,225511 2,038 943 11,,445500 Corporation income taxes 7 Gross receipts 109,683 117,015 52,821 58,002 56,409 61,585 20,085 3,279 3,381 8 Refunds 15,487 13,723 7,119 8,706 7,250 77,,225599 655 22,,554499 996 9 Social insurance taxes and contributions, net 334,335 335599,,441166 114433,,775555 118811,,005588 115577,,660033 220000,,112277 2299,,225599 2244,,330088 2266,,779911 10 Employment taxes and contributions 305,093 332,859 130,388 164,412 144,983 118844,,556699 29,632 2233,,110000 2244,,330033 11 Self-employment taxes and contributions 17,691 18,405 1,889 14,839 3,032 16,371 2,540 0 140 12 Unemployment insurance 24,584 22,011 10,977 14,363 10,359 13,279 -796 859 2,088 13 Other net receipts 4,659 4,547 2,390 2,284 2,262 2,277 424 350 401 14 Excise taxes 35,540 34,386 17,680 16,440 19,299 16,814 2,428 2,970 2,939 15 Customs deposits 15,41 r 16,334' 7,806 7,522 8,107 7,918 1,352 1,493 1,421 16 Estate and gift taxes 7,594 8,745 3,610 3,863 4,054 4,583 631 835 693 17 Miscellaneous receipts 19,909 22,927 10,399 9,950 10,873 10,235 1,107 2,598 2,535 OUTLAYS 18 All types 1,063,318' 1,142,777' 532,652' 512,856' 552,801' 565,524 105,299 94,515 100,172 19 National defense 290,361 303,551 146,995 143,080 150,496 148,098 28,641 19,930 25,234 20 International affairs 10,471 9,596 4,487 7,150 2,636 6,605 868 2,117 495 21 General science, space, and technology 10,841 12,891 5,469 5,361 5,852 6,238 1,190 1,342 1,155 22 Energy 2,297 3,745 1,468 555 1,966 2,221 -182 363 -170 23 Natural resources and environment 14,625' 16,084 7,590 6,776 9,144 7,022 1,423 1,975 2,064 24 Agriculture 17,210 16,948 14,640 7,872 6,911 9,619 -61 904 1,967 25 Commerce and housing credit 18,828' 27,716' 3,852 5,951 19,836 4,129 10,003' 5,496 2,030 26 Transportation 27,272 27,623 14,096 12,700 14,922 13,035 2,348 2,618 2,584 27 Community and regional development 5,294 5,755 2,075 2,765 2,690 1,833 964 790 1,100 28 Education, training, employment, and social services 31,938 35,697 15,592 15,451 16,152 18,083 2,937 3,251 3,194 29 Health 44,490 48,391 20,750 22,643 23,360 24,078 3,613 4,511 4,136 30 Social security and medicare 297,828 317,506 158,469 135,322 149,017 162,195 26,909 27,143 27,337 31 Income security 129,332 136,765 61,201 65,555 64,978 70,937 12,126 9,711 11,456 32 Veterans benefits and services 29,406' 30,066 14,956 13,241 15,797 14,891 3,628 1,503 2,627 33 Administration of justice 8,436' 9,396 4,105 4,379 4,351 4,801 836 842 771 34 General government 9,518' 8,940 3,560 4,337 5,137 3,858 997 842 1,437 35 General-purpose fiscal assistance 1,816 n.a. 1,175 448 0 0 n.a. n.a. n.a. 36 Net interest6 151,748 169,314 71,933 76,098 78,317 86,009 13,684 14,124 15,526 37 Undistributed offsetting receipts -36,967 -37,212 -17,684 -17,766 -18,771 -18,131 -4,625 -2,945 -2,771 1. Functional details do not add to total outlays for calendar year data because 5. Deposits of earnings by Federal Reserve Banks and other miscellaneous revisions to monthly totals have not been distributed among functions.. Fiscal year receipts. total for outlays does not correspond to calendar year data because revisions from 6. Net interest function includes interest received by trust funds. the Budget have not been fully distributed across months. 7. Consists of rents and royalties on the outer continental shelf and U.S. 2. Old-age, disability, and hospital insurance, and railroad retirement accounts. government contributions for employee retirement. 3. Old-age, disability, and hospital insurance. SOURCES. U.S. Department of the Treasury, Monthly Treasury Statement of 4. Federal employee retirement contributions and civil service retirement and Receipts and Outlays of the U.S. Government, and the U.S. Office of Managedisability fund. ment and Budget, Budget of the U.S. Government, Fiscal Year 1990. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 Domestic Financial Statistics • February 1990 1.40 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars 1987 1988 1989 IItteemm Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 1 Federal debt outstanding 2,354.3 2,435.2 2,493.2 2,555.1 2,614.6 2,707.3 2,763.6 2,824.0 2,881.1 2 Public debt securities 2,350.3 2,431.7 2,487.6 2,547.7 2,602.2 2,684.4 2,740.9 2,799.9 2,857.4 3 Held by public 1,893.1 1,954.1 1,996.7 2,013.4 2,051.7 2,095.2 2,133.4 2,142.1 2,180.7r 4 Held by agencies 457.2 477.6 490.8 534.2 550.4 589.2 607.5 657.8 676.7r 5 Agency securities 4.0 3.5 5.6 7.4 12.4 22.9 22.7 24.0 23.7 6 Held by public 3.0 2.7 5.1 7.0 12.2 22.6 22.3 23.6 23.5r 7 Held by agencies 1.0 .8 .6 .5 .2 .3 .4 .5 .R 8 Debt subject to statutory limit 2,336.0 2,417.4 2,472.6 2,532.2 2,586.9 2,669.1 2,725.6 2,784.6 2,829.8 9 Public debt securities 2,334.7 2,416.3 2,472.1 2,532.1 2,586.7 2,668.9 2,725.5 2,784.3 2,829.5 10 Other debt1 1.3 1.1 .5 .1 .1 .2 .2 .2 .3 11 MEMO: Statutory debt limit 2,800.0 2,800.0 2,800.0 2,800.0 2,800.0 2,800.0 2,800.0 2,800.0 2,870.0 1. Includes guaranteed debt of Treasury and other federal agencies, specified SOURCES. Treasury Bulletin and Monthly Statement of the Public Debt of the participation certificates, notes to international lending organizations, and District United States. of Columbia stadium bonds. 1.41 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1988 1989 TTyyppee aanndd hhoollddeerr 11998855 11998866 11998877 11998888 Q4 Ql Q2 Q3 1 Total gross public debt 1,945.9 2,214.8 2,431.7 2,684.4 2,684.4 2,740.9 2,799.9 2,857.4 By type 2 Interest-bearing debt 1,943.4 2,212.0 2,428.9 2,663.1 2,663.1 2,738.3 2,797.4 2,836.3 3 Marketable 1,437.7 1,619.0 1,724.7 1,821.3 1,821.3 1,871.7 1,877.3 1,892.8 4 Bills 399.9 426.7 389.5 414.0 414.0 417.0 397.1 406.6 5 812.5 927.5 1,037.9 1,083.6 1,083.6 1,121.4 1,137.2 1,133.2 6 Bonds 211.1 249.8 282.5 308.9 308.9 318.4 328.0 338.0 7 Nonmarketable1 505.7 593.1 704.2 841.8 841.8 866.6 920.1 943.5 8 State and local government series 87.5 110.5 139.3 151.5 151.5 154.4 156.0 158.6 9 Foreign issues 7.5 4.7 4.0 6.6 6.6 6.7 6.2 6.8 10 Government 7.5 4.7 4.0 6.6 6.6 6.7 6.2 6.8 11 Public .0 .0 .0 .0 .0 .0 .0 .0 12 Savings bonds and notes 78.1 90.6 99.2 107.6 107.6 110.4 112.3 114.0 13 Government account series3 332.2 386.9 461.3 575.6 575.6 594.7 645.2 663.7 14 Non-interest-bearing debt 2.5 2.8 2.8 21.3 21.3 2.6 2.5 21.1 By holder4 15 U.S. government agencies and trust funds 348.9 403.1 477.6 589.2 589.2 607.5 657.8 676.7 16 Federal Reserve Banks 181.3 211.3 222.6 238.4 238.4 228.6 231.8 220.6 17 Private investors 1,417.2 1,602.0 1,745.2 1,852.8 1,852.8 1,900.2 1,905.4 1,954.6 18 Commercial banks 198.2 203.5 201.5 193.8' 193.8r 200.9' 206.7 n.a. 19 Money market funds 25.1 28.0 14.6 18.8 18.8 13.0 11.6 12.4 20 Insurance companies 78.5 105.6 104.9 111.2 111.2 112.5 n.a. n.a. 21 Other companies 59.0 68.8 84.6 86.5 86.5 89.2 90.7 n.a. 22 State and local Treasurys 226.7 262.8 284.6 313.6 313.6 320.4R 322.1 n.a. Individuals 23 Savings bonds 79.8 92.3 101.1 109.6 109.6 112.2 114.0 115.7 24 Other securities 75.0 70.4r 70.2r 77.0' 77.0r 82.9 89.1 n.a. 25 Foreign and international 224.8r 263.4R 299.7r 362. lr 362.lr 375.6r 367.9r 393.5 26 Other miscellaneous investors 450. r 506.6r 584.0' 587.2'' 587.2r 593.5 n.a. n.a. 1. Includes (not shown separately): Securities issued to the Rural Electrifica- 5. Consists of investments of foreign and international accounts. Excludes tion Administration; depository bonds, retirement plan bonds, and individual non-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. Treasury deposit accounts, and federally-sponsored agencies. 3. Held almost entirely by U.S. Treasury agencies and trust funds. SOURCES. Data by type of security, U.S. Treasury Department, Monthly 4. Data for Federal Reserve Banks and U.S. Treasury agencies and trust funds Statement of the Public Debt of the United States; data by holder. Treasury 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 A31 1.42 U.S. GOVERNMENT SECURITIES DEALERS Transactions1 Par value; averages of daily figures, in millions of dollars 1989 1989 IItteemm 11998866 11998877 11998888 Sept. Oct. Nov. Oct. 25 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Immediate delivery2 1 U.S. Treasury securities 95,444 110,050 101,623 100,270 130,805 115,682 126,066 111,604 122,123 136,213 102,489 102,967 By maturity 2 Bills 34,247 37,924 29,387 27,668 35,891 32,613 35,763 37,597 31,629 37,609 30,233 31,010 3 Other within 1 year 2,115 3,271 3,426 2,620 3,313 2,808 3,476 3,746 2,567 2,985 2,892 2,655 4 1-5 years 24,667 27,918 27,777 31,526 39,957 38,424 39,069 29,302 38,979 40,713 38,594 38,544 5 5-10 years 20,455 24,014 24,939 24,719 34,361 26,200 30,359 25,618 32,898 32,634 17,022 20,540 6 Over 10 years 13,961 16,923 16,093 13,737 17,283 15,637 17,400 15,342 16,051 22,272 13,747 10,219 By type of customer 7 U.S. government securities dealers 3,669 2,936 2,761 2,794 4,296 3,500 4,583 44,,447700 33,,880000 44,,336688 22,,775544 22,,660077 8 U.S. government securities brokers 49,558 61,539 59,844 60,193 77,566 66,549 75,291 65,793 71,674 76,337 59,482 59,608 9 All others3 42,217 45,575 39,019 37,283 48,943 45,633 46,192 41,341 46,648 55,508 40,254 40,753 10 Federal agency securities 16,747 18,084 15,903 19,193 20,978 20,031 21,123 18,763 21,646 23,174 19,816 15,997 11 Certificates of deposit 4,355 4,112 3,369 2,677 2,422 2,183 2,016 2,106 2,151 2,123 2,273 2,154 12 Bankers acceptances 3,272 2,965 2,316 2,086 2,169 1,994 2,063 2,239 2,068 1,893 1,903 2,106 13 Commercial paper 16,660 17,135 22,927 29,145 34,167r 31,188 32,331 33,197 3322,,333388 3300,,003322 3322,,227777 2277,,228866 Futures contracts 14 Treasury bills 3,311 3,233 2,627 2,645 2,797 1,898 3,363 2,281 2,133 1,786 1,596 2,254 15 Treasury coupons 7,175 8,963 9,695 8,796 10,326 9,308 10,42CT 9,047 9,374 10,779 10,303 6,532 16 Federal agency securities 16 5 1 38 20 7 6 1 15 5 10 0 Forward transactions 17 U.S. Treasury securities 1,876 2,029 2,095 2,117r 2,168 1,993 2,593 954 1,373 3,021 1,450 2,373 18 Federal agency securities 7,830 9,290 8,008 8,614 10,561 10,904 9,105 8,708 13,800 12,563 10,750 6,150 1. Transactions are market purchases and sales of securities as reported to the securities, nondealer departments of commercial banks, foreign banking agencies, Federal Reserve Bank of New York by the U.S. government securities dealers on and the Federal Reserve System. its published list of primary dealers. 4. Futures contracts are standardized agreements arranged on an organized Averages for transactions are based on the number of trading days in the period. exchange in which parties commit to purchase or sell securities for delivery at a The figures exclude allotments of, and exchanges for, new U.S. Treasury future date. securities, redemptions of called or matured securities, purchases or sales of 5. Forward transactions are agreements arranged in the over-the-counter securities under repurchase agreement, reverse repurchase (resale), or similar market in which securities are purchased (sold) for delivery after 5 business days contracts. from the date of the transaction for Treasury securities (Treasury bills, notes, and 2. Data for immediate transactions do not include forward transactions. bonds) or after 30 days for mortgage-backed agency issues. 3. Includes, among others, all other dealers and brokers in commodities and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 Domestic Nonfinancial Statistics • February 1990 1.43 U.S. GOVERNMENT SECURITIES DEALERS Positions and Financing1 Averages of daily figures, in millions of dollars 1989 1989 IItteemm 11998866 11998877 11998888 Sept. Oct/ Nov. Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Positions Net immediate2 1 U.S. Treasury securities 12,912 -6,216 -22,765 12,193 10,666 17,316 15,935 12,067 17,498 22,773 17,038 2 Bills 12,761 4,317 2,238 20,418 19,160 22,626 20,148 18,194 23,518 25,606 24,464 3 Other within 1 year 3,705 1,557 -2,236 197 -1,646 -1,276 -1,166 -942 -1,336 -1,780 -1,091 4 1-5 years 9,146 649 -3,020 5,302 9,666 10,593 13,959 10,388 12,131 10,047 8,875 5 5-10 years -9,505 -6,564 -9,663 -8,630 -10,499 -8,988 -10,210 -10,718 -10,110 -6,125 -9,368 6 Over 10 years -3,197 -6,174 -10,084 -5,093 -6,014 -5,639 -6,795 -4,855 -6,706 -4,975 -5,843 7 Federal agency securities 32,984 31,911 28,230 36,097 36,269 35,424 36,707 36,667 38,916 34,776 31,271 8 Certificates of deposit 10,485 8,188 7,300 7,065 7,124 7,001 7,768 7,414 6,963 6,732 6,580 9 Bankers acceptances 5,526 3,660 2,486 2,154 2,105 1,925 2,431 2,072 1,855 1,716 1,830 10 Commercial paper 8,089 7,496 6,152 8,258 9,055 7,649 8,839 7,447 7,528 7,420 7,583 Futures positions 11 Treasury bills -18,059 -3,373 -2,210 -6,106 -7,459 -9,463 -10,628 -9,722 -8,940 -8,391 -10,425 12 Treasury coupons 3,473 5,988 6,224 -4,797 -9,302 -11,368 -11,645 -11,305 -12,332 -11,078 -10,788 13 Federal agency securities -153 -95 0 -26 68 25 102 86 6 -9 1 Forward positions 14 U.S. Treasury securities -2,144 -1,211 346 -607 1,380 -120 1,746 402 -1,456 -1,012 1,345 15 Federal agency securities -11,840 -18,817 -16,348 -17,478 -15,367 -17,316 -16,519 -18,061 -21,090 -15,673 -14,419 Financing3 Reverse repurchase agreements4 16 Overnight and continuing 98,913 126,709 136,327 157,149 164,478 146,101 166,288 159,868 162,951 127,706 159,062 17 Term 108,607 148,288 177,477 212,378 233,888 231,972 241,762 261,548 224,526 256,670 229,580 Repurchase agreements 18 Overnight and continuing 141,823 170,763 172,695 228,923 242,486 216,140 250,980 235,012 254,482 169,829 241,496 19 Term 102,397 121,270 137,056 172,069 193,445 209,082 208,277 223,068 190,573 269,021 195,645 1. Data for dealer positions and sources of financing are obtained from reports reverses to maturity, which are securities that were sold after having been submitted to the Federal Reserve Bank of New York by the U.S. Treasury obtained under reverse repurchase agreements that mature on the same day as the securities dealers on its published list of primary dealers. securities. Data for immediate positions do not include forward positions. Data for positions are averages of daily figures, in terms of par value, based on 3. Figures cover financing involving U.S. Treasury and federal agency securithe number of trading days in the period. Positions are net amounts and are shown ties, negotiable CDs, bankers acceptances, and commercial paper. on a commitment basis. Data for financing are in terms of actual amounts 4. Includes all reverse repurchase agreements, including those that have been borrowed or lent and are based on Wednesday figures. arranged to make delivery on short sales and those for which the securities 2. Immediate positions are net amounts (in terms of par values) of securities obtained have been used as collateral on borrowings, that is, matched agreements. owned by nonbank dealer firms and dealer departments of commercial banks on 5. Includes both repurchase agreements undertaken to finance positions and a commitment, that is, trade-date basis, including any such securities that have "matched book" repurchase agreements. been sold under agreements to repurchase (RPs). The maturities of some NOTE. Data on positions for the period May 1 to Sept. 30, 1986, are partially repurchase agreements are sufficiently long, however, to suggest that the securi- estimated. ties involved are not available for trading purposes. Immediate positions include Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A33 1.44 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt Outstanding Millions of dollars, end of period 1989 AAggeennccyy 11998844 11998855 11998866 11998877 June July Aug. Sept. Oct. 1 Federal and federally sponsored agencies 271,564 293,905 307,361 341,386 406,837 411,874 411,979 408,591 n.a. 2 Federal agencies 35,145 36,390 36,958 37,981 36,404 36,453 36,453 36,584 36,378 3 Defense Department' 142 71 33 13 7 7 7 7 7 4 Export-Import Bank • 15,882 15,678 14,211 11,978 11,014 11,014 11,014 10,990 10,990 5 Federal Housing Administration4 133 115 138 183 218 245 255 295 301 6 Government National Mortgage Association participation certificates5 2,165 2,165 2,165 1,615 0 0 0 0 0 7 Postal Service 1,337 1,940 3,104 6,103 6,445 6,445 6,445 6,445 6,445 8 Tennessee Valley Authority 15,435 16,347 17,222 18,089 18,720 18,742 18,732 18,847 18,635 9 United States Railway Association 51 74 85 0 0 0 0 0 0 10 Federally sponsored agencies7 237,012 257,515 270,553 303,405 370,433 375,421 375,526 372,007 n.a. 11 Federal Home Loan Banks 65,085 74,447 88,752 115,725 153,892 151,487 149,269 143,578 140,854 12 Federal Home Loan Mortgage Corporation 10,270 11,926 13,589 17,645 25,243 25,690 27,165 26,738 25,097 N Federal National Mortgage Association 83,720 93,896 93,563 97,057 106,308 109,926 110,155 111,507 111,776 14 Farm Credit Banks8 72,192 68,851 62,478 55,275 52,387 53,158 53,511 54,041 54,050 15 Student Loan Marketing Association 5,745 8,395 12,171 16,503 24,256 26,813 27,079 27,126 n.a. 16 Financing Corporation 0 0 0 1,200 7,500 7,500 7,500 8,170 8,170 17 Farm Credit Financial Assistance Corporation" 0 0 0 0 847 847 847 847 847 MEMO 18 Federal Financing Bank debt12 145,217 153,373 157,510 152,417 139,568 138,814 137,690 136,092 135,841 Lending to federal and federally sponsored agencies 19 Export-Import Bank3 15,852 15,670 14,205 11,972 11,008 11,008 11,008 10,984 1100,,998844 20 Postal Service6 1,087 1,690 2,854 5,853 6,195 6,195 6,195 6,195 6,195 21 Student Loan Marketing Association 5,000 5,000 4,970 4,940 4,910 4,910 4,910 4,910 4,880 22 Tennessee Valley Authority 13,710 14,622 15,797 16,709 17,340 17,362 17,352 17,467 17,255 23 United States Railway Association 51 74 85 0 0 0 0 0 0 Other Lending13 74 Farmers Home Administration 58,971 64,234 65,374 59,674 55,586 54,911 54,611 53,311 53,311 75 Rural Electrification Administration 20,693 20,654 21,680 21,191 19,236 19,257 19,270 19,275 19,233 26 29,853 31,429 32,545 32,078 25,293 25,171 24,344 23,950 23,983 1. Consists of mortgages assumed by the Defense Department between 1957 9. Before late 1981, the Association obtained financing through the Federal and 1963 under family housing and homeowners assistance programs. Financing Bank (FFB). Borrowing excludes that obtained from the FFB, which is 2. Includes participation certificates reclassified as debt beginning Oct. 1, 1976. shown on line 21. 3. Off-budget Aug. 17, 1974, through Sept. 30, 1976; on-budget thereafter. 10. The Financing Corporation, established in August 1987 to recapitalize the 4. Consists of debentures issued in payment of Federal Housing Administration Federal Savings and Loan Insurance Corporation, undertook its first borrowing in insurance claims. Once issued, these securities may be sold privately on the October 1987. securities market. 11. The Farm Credit Financial Assistance Corporation (established in January 5. Certificates of participation issued before fiscal 1969 by the Government 1988 to provide assistance to the Farm Credit System) undertook its first National Mortgage Association acting as trustee for the Farmers Home Admin- borrowing in July 1988. istration; Department of Health, Education, and Welfare; Department of Housing 12. The FFB, which began operations in 1974, is authorized to purchase or sell and Urban Development; Small Business Administration; and the Veterans obligations issued, sold, or guaranteed by other federal agencies. Since FFB Administration. incurs debt solely for the purpose of lending to other agencies, its debt is not 6. Off-budget. included in the main portion of the table in order to avoid double counting. 7. Includes outstanding noncontingent liabilities: notes, bonds, and deben- 13. Includes FFB purchases of agency assets and guaranteed loans; the latter tures. Some data are estimated. contain loans guaranteed by numerous agencies with the guarantees of any 8. Excludes borrowing by the Farm Credit Financial Assistance Corporation, particular agency being generally small. The Farmers Home Administration item shown in line 17. consists exclusively of agency assets, while the Rural Electrification Administration entry contains both agency assets and guaranteed loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A34 Domestic Nonfinancial Statistics • February 1990 1.45 NEW SECURITY ISSUES Tax-Exempt State and Local Governments Millions of dollars 1989 TTyyppee ooff iissssuuee oorr iissssuueerr,, oorr uussee 11998866 11998877 11998888 Apr. May June July Aug. Sept. Oct/ Nov. 1 All issues, new and refunding1 147,011 102,407 114,522 7,464 7,435 13,775 8,735 9,824 10,818 9,075 8,653 Type of issue 2 General obligation 46,346 30,589 30,312 2,301 2,342 4,960 3,789 2,199 3,500 3,273 3,654 3 Revenue 100,664 71,818 84,210 5,163 5,093 8,815 4,946 7,625 7,318 5,802 4,999 Type of issuer 4 State 14,474 10,102 8,830 1,407 392 1,989 970 694 764 1,330 798 5 Special district and statutory authority2 89,997 65,460 74,409 4,238 4,979 8,033 4,868 7,027 7,567 4,770 4,930 6 Municipalities, counties, and townships 42,541 26,845 31,193 1,819 2,064 3,753 2,897 2,103 2,487 2,975 2,925 7 Issues for new capital, total 83,492 56,789 79,665 6,061 5,938 10,078 6,816 6,612 7,470 7,266 7,691 Use of proceeds 8 Education 12,307 9,524 15,021 1,225 1,024 2,678 998 1,302 1,639 1,006 989 9 Transportation 7,246 3,677 6,825 743 748 576 500 556 976 280 669 10 Utilities and conservation 14,594 7,912 8,4% 759 467 1,058 551 813 622 718 1,775 11 Social welfare 11,353 11,106 19,027 1,048 1,376 1,509 1,632 1,553 1,242 1,803 1,256 12 Industrial aid 6,190 7,474 5,624 374 361 329 440 447 381 345 280 13 Other purposes 31,802 18,020 24,672 1,912 1,962 3,928 2,695 1,941 2,610 3,114 2,722 1. Par amounts of long-term issues based on date of sale. SOURCES. Securities Data/Bond Buyer Municipal Data Base beginning 1986. 2. Includes school districts beginning 1986. Public Securities Association for earlier data. 1.46 NEW SECURITY ISSUES U.S. Corporations Millions of dollars 1989 Type of issue or issuer, or use 11998866 11998877 11998888 Mar. Apr. May June July Aug. Sept. Oct. 1 All issues 424,737 392,165' 408,843 26,191' 14,405' 21,471' 24,450' 17,658^ 14,822 14,208r 24,180 2 Bonds2 356,304 325,657r 351,042 25,577 13,396 19,662 21,622 12,604 12,787 11,935' 20,500 Type of offering 3 Public, domestic 232,742 209,279 200,164 22,995 11,471 17,756 18,714 11,184 11,971 10,735' 19,000 4 Private placement, domestic3 . 80,760 92,070 127,700 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5. Sold abroad 42,801 24,308' 23,178 2,582 1,925 1,906 2,908 1,420 816 1,200' 1,500 Industry group 6 Manufacturing 90,788 61,666 69,573 7,456 1,457 7,715' 3,273 2,701 2,627 2,102 3,388 7 Commercial and miscellaneous 41,909 49,327 61,986 882 843 2,162 1,628 1,331 1,090 1,393 1,800 8 Transportation 10,423 11,974 9,976 0 100 150 480 0 423 0 831 9 Public utility 30,973 23,004 19,318 153 1,695 385 2,936 1,173 670 1,095' 1,716 10 Communication 16,441 7,340 5,902 63 453 122 4 300 358 308 632 11 Real estate and financial 165,770 172,351' 184,287 17,023 8,848 9,128 13,302 7,099 7,619 7,038' 12,133 12 Stocks2 68,433 66,508 57,802 614 1,009 1,809 2,828 5,054 2,035 2,273 3,680 Type 13 Preferred 11,514 10,123 6,544 0 495 306 335 920 1,013 519 570 14 Common 50,316 43,225 35,911 614 514 1,503 2,493 4,134 1,023 1,754 3,110 15 Private placement3 6,603 13,157 15,346 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Industry group 16 Manufacturing 15,027 13,880 7,608 130 155 299 630 593 393 193 190 17 Commercial and miscellaneous 10,617 12,888 8,449 26 282 115 512 438 343 155 728 18 Transportation 2,427 2,439 1,535 53 169 39 0 0 0 0 50 19 Public utility 4,020 4,322 1,898 108 0 192 125 25 137 709 465 20 Communication 1,825 1,458 515 0 93 280 25 29 20 0 0 21 Real estate and financial 34,517 31,521 37,798 297 310 884 1,536 3,969 1,020 1,195 2,214 1. Figures which represent gross proceeds of issues maturing in more than one 3. Data are not available on a monthly basis. Before 1987, annual totals include year, are principal amount or number of units multiplied by offering price. underwritten issues only. Excludes secondary offerings, employee stock plans, investment companies other SOURCES. IDD Information Services, Inc., the Board of Governors of the than closed-end, intracorporate transactions, equities sold abroad, and Yankee Federal Reserve System, and before 1989, the U.S. Securities and Exchange bonds. Stock data include ownership securities issued by limited partnerships. Commission. 2. Monthly data include only public offerings. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Market and Corporate Finance A35 1.47 OPEN-END INVESTMENT COMPANIES Net Sales and Asset Position Millions of dollars 1989 IItteemm 11998877 11998888 Mar. Apr. May June July Aug. Sept/ Oct. INVESTMENT COMPANIES1 1 Sales of own shares2 381,260 271,237 23,149 25,496 24,661 25,817 25,330 26,800 23,911 25,300 2 Redemptions of own shares3 314,252 267,451 24,135 26,183 22,483 22,562 20,053 22,262 21,499 21,702 3 Net sales 67,008 3,786 -986 -687 2,178 3,255 5,277 4,538 2,412 3,598 4 Assets4 453,842 472,297 483,067 497,329 509,781 515,814 535,910 539,553 539,814 534,891 5 Cash position5 38,006 45,090 46,262 48,788 49,177 48,428 47,888 47,209 47,163 45,923 6 Other 415,836 427,207 436,805 448,541 460,604 467,386 488,022 492,344 492,651 488,968 1. Data on sales and redemptions exclude money market mutual funds but 4. Market value at end of period, less current liabilities. include limited maturity municipal bond funds. Data on asset positions exclude 5. Also includes all U.S. government securities and other short-term debt both money market mutual funds and limited maturity municipal bond funds. securities. 2. Includes reinvestment of investment income dividends. Excludes reinvest- NOTE. Investment Company Institute data based on reports of members, which ment of capital gains distributions and share issue of conversions from one fund comprise substantially all open-end investment companies registered with the to another in the same group. Securities and Exchange Commission. Data reflect newly formed companies after 3. Excludes share redemption resulting from conversions from one fund to their initial offering of securities. another in the same group. SOURCE. Survey of Current Business (Department of Commerce). 1.48 CORPORATE PROFITS AND THEIR DISTRIBUTION A Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1987 1988 1989 AAccccoouunntt 11998866 11998877 11998888 Q4 Q1 Q2 Q3 Q4 Ql Q2 Q3' 1 Corporate profits with inventory valuation and capital consumption adjustment 282.1 298.7 328.6 308.2 318.1 325.3 330.9 340.2 316.3 307.8 295.2 2 Profits before tax 221.6 266.7 306.8 276.2 288.8 305.3 314.4 318.8 318.0 296.0 275.0 3 Profits tax liability 106.3 124.7 137.9 127.3 129.0 138.4 141.2 143.2 144.4 134.9 122.6 4 Profits after tax 115.3 142.0 168.9 148.9 159.9 166.9 173.2 175.6 173.6 161.1 152.4 5 Dividends 91.3 98.7 110.4 102.8 105.7 108.6 112.2 115.2 118.5 120.9 123.3 6 Undistributed profits 24.0 43.3 58.5 46.1 54.2 58.3 61.1 60.4 55.1 40.2 29.1 7 Inventory valuation 6.7 -18.9 -25.0 -20.4 -20.7 -28.8 -30.4 -20.1 -38.3 -20.5 -6.3 8 Capital consumption adjustment 53.8 50.9 46.8 52.4 49.9 48.9 46.9 41.5 36.6 32.3 26.5 ATrade and services are no longer being reported separately. They are included in Commercial and other, line 10. 1.50 TOTAL NONFARM BUSINESS EXPENDITURES on New Plant and Equipment A Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1988 1989 1990 IInndduussttrryy 11998877 11998888 11998899'' Q2 Q3 Q4 Ql Q2 Q3 Q41 Ql1 1 Total nonfarm business 389.67 430.76 475.18 427.54 435.61 442.11 459.47 470.86 484.93 485.45 503.46 Manufacturing 2 Durable goods industries 71.01 78.30 8833..0055 77.38 79.15 80.56 81.26 82.97 85.66 82.30 86.84 3 Nondurable goods industries 74.88 88.01 100.11 85.24 89.62 92.76 93.96 98.57 102.00 105.90 106.92 Nonmanufacturing 4 Mining 11.39 1122..6666 1122..5500 1133..1155 12.53 12.38 12.15 12.70 12.59 12.58 12.23 Transportation 5 Railroad 5.92 77..0066 88..1122 66..9999 6.84 7.45 8.02 7.37 8.16 8.93 7.91 6 Air 6.53 7.28 9.50 6.91 8.09 7.69 7.04 9.49 12.48 8.99 10.12 7 Other 6.40 7.00 7.62 7.05 7.08 6.89 8.07 7.40 7.89 7.13 8.58 Public utilities 8 Electric 31.63 32.03 33.96 31.31 32.07 33.69 33.69 35.34 33.73 33.07 35.47 9 Gas and other 13.25 14.64 16.10 14.49 14.61 15.04 17.12 16.67 15.84 14.79 16.42 10 Commercial and other2 168.65 183.76 204.22 185.21 185.61 185.65 198.15 200.36 206.59 211.76 218.97 1. Anticipated by business. insurance; personal and business services; and communication. 2. "Other" consists of construction; wholesale and retail trade; finance and SOURCE. Survey of Current Business (Department of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 Domestic Nonfinancial Statistics • February 1990 1.51 DOMESTIC FINANCE COMPANIES Assets and Liabilities1 Billions of dollars, end of period 1988 1989 AAccccoouunntt 11998855 11998866 11998877 Ql Q2 Q3 Q4 Ql Q2 Q3 ASSETS Accounts receivable, gross2 1 Consumer 111.9 134.7 141.1 141.5 144.4 146.3 146.2 140.2 144.9 147.2 2 Business 157.5 173.4 207.4 219.7 224.0 223.3 236.5 243.1 250.5 248.8 3 Real estate 28.0 32.6 39.5 41.4 42.5 43.1 43.5 45.4 47.4 48.9 4 Total 297.4 340.6 388.1 402.6 410.9 412.7 426.2 428.7 442.8 444.9 Less: 5 Reserves for unearned income 39.2 41.5 45.3 46.8 46.3 48.4 50.0 50.9 52.1 53.7 6 Reserves for losses 4.9 5.8 6.8 6.8 6.8 7.1 7.3 7.4 7.5 7.8 7 Accounts receivable, net 253.3 293.3 336.0 348.9 357.8 357.3 368.9 370.4 383.2 383.5 8 All other 45.3 58.6 58.3 60.1 70.5 68.7 72.4 75.1 81.5 83.1 9 Total assets 298.6 351.9 394.2 409.1 428.3 426.0 441.3 445.5 464.6 466.6 LIABILITIES 10 Bank loans 18.0 18.6 16.4 14.9 13.3 11.9 15.4 11.6 12.2 12.3 11 Commercial paper 99.2 117.8 128.4 125.2 131.6 129.4 142.0 147.9 114499..22 114477..44 Debt 12 Other short-term 12.7 17.5 28.0 n.a. n.a. n.a. n.a. n.a. n.a. n.a. 13 Long-term 94.4 117.5 137.1 n.a. n.a. n.a. n.a. n.a. n.a. n.a. 14 Due to parent n.a. n.a. n.a. 49.0 51.4 51.5 50.6 56.8 59.7 60.4 15 Not elsewhere classified n.a. n.a. n.a. 132.4 139.8 139.3 137.9 134.5 141.3 146.1 16 All other liabilities 41.5 44.1 52.8 56.1 58.7 58.9 59.8 58.1 63.5 60.4 17 Capital, surplus, and undivided profits 32.8 36.4 31.5 31.5 33.5 34.9 35.6 36.6 38.7 40.0 18 Total liabilities and capital 298.6 351.9 394.2 409.1 428.3 426.0 441.3 445.5 464.6 466.6 1. Components may not add to totals because of rounding. 2. Excludes pools of securitized assets. 1.52 DOMESTIC FINANCE COMPANIES Business Credit Outstanding and Net Change1 Millions of dollars, seasonally adjusted 1989 Type 11998866 11998877 11998888 May June July Aug. Sept. Oct. 1 Total 172,060 205,810 234,529 245,861 249,322 251,126 253,822 258,851 259,083 Retail financing of installment sales 2 Automotive 26,015 35,782 36,548 38,816 39,042 39,183 39,355 39,258 38,952 3 Equipment 23,112 25,170 28,298 27,638 27,773 28,128 29,039 29,639 29,594 4 Pools of securitized assets2 n.a. n.a. n.a. 846 807 769 793 755 715 Wholesale 5 Automotive 23,010 30,507 33,300 34,534 34,021 33,233 33,566 37,243 35,210 6 Equipment 5,348 5,600 5,983 6,0% 6,165 6,244 6,497 6,602 6,843 7 All other 7,033 8,342 9,341 9,929 9,862 10,001 9,990 9,957 9,927 8 Pools of securitized assets2 n.a. n.a. n.a. 0 0 0 0 0 0 Leasing 9 Automotive 19,827 21,952 24,673 26,011 26,515 26,701 26,739 26,865 27,442 10 Equipment 38,179 43,335 57,455 61,022 63,370 64,086 64,186 65,170 66,787 11 Pools of securitized assets2 n.a. n.a. n.a. 824 796 887 990 948 1,199 12 Loans on commercial accounts receivable and factored commercial accounts receivable 15,978 18,078 17,796 18,772 19,302 19,989 20,098 19,611 19,487 13 All other business credit 13,557 17,043 21,134 21,371 21,669 21,904 22,571 22,804 22,926 Net change (during period) 14 Total 15,763 33,750 22,662 978 3,462 1,803 2,697 5,029 232 Retail financing of installment sales 15 Automotive 5,355 9,767 766 401 226 141 172 -97 -305 1 1 6 7 E Po q o u l i s p m of e n se t curitized assets2 n. 6 a 2 . 9 2 n , . 0 a 5 . 8 n 1, . 3 a 8 . 4 -1,15 2 2 9 - 1 3 3 9 5 - 3 3 5 8 4 9 2 1 4 1 - 6 3 0 8 0 - - 4 4 0 5 Wholesale 18 Automotive -978 7,497 2,793 151 -513 -788 332 3,677 -2,033 19 Equipment 780 252 226 -56 69 79 253 104 242 2 2 1 0 P A o ll o o ls t h o e f r securitized assets2 n. 2 a 2 . 4 n 1, . 3 a 0 . 9 n. 9 a 9 . 9 78 0 -68 0 13 0 9 -11 0 -32 0 -30 0 Leasing 22 Automotive 3,552 2,125 2,721 467 504 187 38 126 577 2 2 3 4 E Po q o u l i s p m of e n se t curitized assets2 3 n , . 4 a 1 . 1 5 n , . 1 a 5 . 6 9 n , . 9 a 6 . 2 77 9 6 1 2, - 3 2 4 8 8 71 9 6 1 1 9 0 9 3 - 9 4 8 2 4 1, 2 6 5 1 1 8 25 Loans on commercial accounts receivable and factored commercial accounts receivable 213 2,100 -282 95 530 687 109 -487 -124 26 All other business credit 2,576 3,486 4,091 100 298 235 667 234 122 1. These data also appear in the Board's G.20 (422) release. For address, see 2. Data on pools of securitized assets are not seasonally adjusted. inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Real Estate A37 1.53 MORTGAGE MARKETS Millions of dollars; exceptions noted. 1989 IItteemm 11998866 11998877 11998888 May June July Aug. Sept. Oct. Nov. Terms and yields in primary and secondary markets PRIMARY MARKETS Conventional mortgages on new homes Terms1 1 Purchase price (thousands of dollars) 118.1 137.0 150.0 151.8 150.5 174.5 160.8 160.6 153.1 2 Amount of loan (thousands of dollars) 86.2 100.5 110.5 112.3 111.0 125.3 119.4 118.6 111.3 3 Loan/price ratio (percent) 75.2 75.2 75.5 75.3 75.2 73.8 75.6 75.3 73.2 4 Maturity (years) 26.6 27.8 28.0 28.3 27.8 28.6 28.3 28.4r 27.3 5 Fees and charges (percent of loan amount) , 2.48 2.26 2.19 2.12 1.91 2.42 2.31 2.14r 1.95 6 Contract rate (percent per year) 9.82 8.94 8.81 9.82 10.09 10.06 9.83 9.87r 9.77 Yield (percent per year) 7 OTS series3 10.26 9.31 9.18 10.18 10.42 10.48 10.22 10.24r 10.11 8 HUD series4 10.07 10.17 10.30 10.43 10.04 9.70 10.05 10.04 9.79 SECONDARY MARKETS Yield (percent per year) 9 FHA mortgages (HUD series) 9.91 10.16 10.49 10.55 10.08 9.61 9.95 9.94 9.73 10 GNMA securities6 9.30 9.43 9.83 10.11 9.75 9.55 9.48 9.47 9.21 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 11 Total 98,048 95,030 101,329 102,564 103,309 104,421 105,896 107,052 108,180 109,076 12 FHA/VA-insured 29,683 21,660 19,762 19,612 19,586 19,630 19,589 19,608 19,843 19,953 13 Conventional 68,365 73,370 81,567 82,952 83,723 84,791 86,307 87,444 88,337 89,123 Mortgage transactions (during period) 14 Purchases 30,826 20,531 23,110 1,419 1,862 2,091 2,724 2,223 2,267 2,376 Mortgage commitments7 15 Contracted (during period) 32,987 25,415 23,435 1,626 2,573 2,513 2,842 2,328 2,963 2,536 16 Outstanding (end of period) 3,386 4,886 2,148 4,673 5,236 5,648 5,755 5,865 6,548 6,645 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of periodf 17 Total 13,517 12,802 15,105 19,443 20,121 20,533 21,024 20,650 n.a. n.a. 18 FHA/VA 746 686 620 586 585 585 589 540 n.a. n.a. 19 Conventional 12,771 12,116 14,485 18,857 19,535 19,948 20,435 20,110 n.a. n.a. Mortgage transactions (during period) 20 Purchases 103,474 76,845 44,077 5,141 7,392 5,720 7,283 7,889 n.a. n.a. 21 Sales 100,236 75,082 39,780 4,474 6,551 5,180 6,650 8,050 n.a. n.a. Mortgage commitments9 22 Contracted (during period) 110,855 71,467 66,026 5,186 7,948 6,608 5,705 7,708 n.a. n.a. 1. Weighted averages based on sample surveys of mortgages originated by 6. Average net yields to investors on Government National Mortgage Associmajor institutional lender groups; compiled by the Federal Home Loan Bank ation guaranteed, mortgage-backed, fully modified pass-through securities, as- Board in cooperation with the Federal Deposit Insurance Corporation. suming prepayment in 12 years on pools of 30-year FHA/VA mortgages carrying 2. Includes all fees, commissions, discounts, and "points" paid (by the the prevailing ceiling rate. Monthly figures are averages of Friday figures from the borrower or the seller) to obtain a loan. Wall Street Journal. 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. Based on transactions on first day of subsequent month. Large securities swap programs, while the corresponding data for FNMA exclude swap monthly movements in average yields may reflect market adjustments to changes activity. in maximum permissable contract rates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A38 Domestic Nonfinancial Statistics • February 1990 1.54 MORTGAGE DEBT OUTSTANDING1 Millions of dollars, end of period 1988 Type of holder, and type of property 1986 1987 1988 Q2 Q3 Q4 Q1 Q2P 1 AU holders. 2,618,324 2,977,293 3,268,285 3,120,536 3,189,132 3,268,285 3,328,824 3,391,259 2 1- to 4-family 1,719,673 1,959,607 2,189,475 2,070,829 2,134,225 2,189,475 2,230,006 2,281,317 3 Multifamily.. 247,831 273,954 290,355 280,239 284,675 290,355 296,139 297,860 4 Commercial . 555,039 654,863 701,652 681,660 683,207 701,652 716,695 725,341 5 Farm 95,781 88,869 86,803 87,808 87,025 86,803 85,984 86,741 6 Selected financial institutions . 1,507,944 1,704,560 1,874,967 1,791,714 1,833,800 1,874,967 1,905,052 1,932,154 Commercial banks . 502,534 591,369 669,160 629,617 650,799 669,160 688,662 715,049 1- to 4-family 235,814 276,270 314,283 296,265 307,041 314,283 324,681 338,872 Multifamily.. 31.173 33,330 34,131 34,225 33,960 34,131 34,172 34,954 Commercial .. 222.799 267,340 305,242 283,942 294,398 305,242 313,941 324,878 Farm 12,748 14.429 15,504 15,185 15,400 15,504 15,868 16,345 Savings institutions 777,967 860,467 929,647 898,742 914,280 929,647 936,091 933,694 1- to 4-family 559,067 602,408 678,263 638,638 665,294 678,263 682,658 684,828 Multifamily 97,059 106,359 111,302 107,482 109,287 111,302 112,507 110,009 Commercial 121,236 150,943 139,416 151,870 139,029 139,416 140,255 138,201 Farm 605 Life insurance companies 193,842 ' iii,375 ''232,639 ' 220,870 ''225,627 "232,639 234,'910 "236,166 1- to 4-family 12,827 13,226 15,284 14,172 14,917 15,284 12,690 12,745 Multifamily 20,952 22,524 23,562 23,021 23,139 23,562 24,636 25,103 Commercial 149,111 166,722 184,124 174,086 178,166 184,124 188,073 188,756 Farm 10,952 9,903 9,669 9,591 9,405 9,669 9,511 9,556 Finance companies4 33,601 40,349 43,521 42,485 43,094 43,521 45,389 47,251 23 Federal and related agencies 203.800 192,721 200,570 199,474 198,027 200,570 199,847 201,909 24 Government National Mortgage Association. 889 444 26 42 64 26 26 24 25 1- to 4-family 47 25 26 24 51 26 26 24 26 Multifamily 842 419 18 13 27 Farmers Home Administration 48,421 43,051 '"42,018 42,767 41,836 '42,018 4 i ,780 40,711 28 1- to 4-family 21,625 18,169 18,347 18,248 18,268 18,347 18,347 18,391 29 Multifamily 7,608 8,044 8,513 8,213 8,349 8,513 8,615 8,778 30 Commercial 8,446 6,603 5,343 6,288 5,300 5,343 5,101 3,885 31 Farm 10,742 10,235 9,815 10,018 9,919 9,815 9,717 9,657 Federal Housing and Veterans Administration. 5,047 5,574 5,973 5,673 5,666 5,973 6,075 6,424 1- to 4-family 2,386 2,557 2,672 2,564 2,432 2,672 2,550 2,827 Multifamily 2,661 3,017 3,301 3,109 3,234 3,301 3,525 3,597 Federal National Mortgage Association 97,895 96,649 103,013 102,368 102,453 103,013 101,991 103,309 1- to 4-family 90,718 89,666 95,833 95,404 95,417 95,833 94,727 95,714 Multifamily 7,177 6,983 7,180 6,964 7,036 7,180 7,264 7,595 Federal Land Banks 39,984 34,131 32,115 33,048 32,566 32,115 31,261 31,467 1- to 4-family 2,353 2,008 1,890 1,945 1,917 1,890 1,839 1,851 Farm 37,631 32,123 30,225 31,103 30,649 30,225 29,422 29,616 Federal Home Loan Mortgage Corporation ... 11,564 12,872 17,425 15,576 15,442 17,425 18,714 19,974 1- to 4-family 10,010 11.430 15,077 13,631 13,322 15,077 16,192 17,305 Multifamily 1,554 1,442 2,348 1,945 2,120 2,348 2,522 2,669 44 Mortgage pools or trusts 565,428 718,297 810,887 754,045 782,802 810,887 839,684 861,827 45 Government National Mortgage Association. 262,697 317,555 340,527 322,616 333,177 340,527 348,622 353,154 1- to 4-family 256,920 309,806 331,257 314,728 324,573 331,257 337,563 341,951 Multifamily 5,777 7,749 9,270 7,888 8,604 9,270 11,059 11,203 Federal Home Loan Mortgage Corporation . 171,372 212,634 226,406 216,155 220,684 226,406 234,695 242,789 1- to 4-family 166,667 205,977 219,988 209,702 214,195 219,988 228,389 236,404 Multifamily 4,705 6,657 6,418 6,453 6,489 6,418 6,306 6,385 Federal National Mortgage Association 97.174 139,960 178,250 157,438 167,170 178,250 188,071 196,501 1- to 4-family 95,791 137,988 172,331 153,253 162,228 172,331 181,352 188,774 Multifamily 1,383 1,972 5,919 4,185 4,942 5,919 6,719 7,727 Farmers Home Administration 348 245 104 106 106 104 96 85 1- to 4-family 142 121 26 23 27 26 24 23 Multifamily Commercial 132 63 38 41 38 38 34 26 Farm 74 61 40 42 41 40 38 36 59 Individuals and others 341,152 361,715 381,861 375,303 374,503 381,861 384,241 395,369 60 1- to 4-family 197,868 201,704 215,077 212,017 209,784 215,077 215,379 225,059 61 Multifamily 66,940 75,458 78,411 76,736 77,502 78,411 78,814 79,840 62 Commercial 53,315 63,192 67,489 65,433 66,276 67,489 69,291 69,595 63 Farm 23,029 21,361 20,884 21,117 20,941 20,884 20,757 20,875 1. Based on data from various institutional and governmental sources, with 5. FmHA-guaranteed securities sold to the Federal Financing Bank were some quarters estimated in part by the Federal Reserve. Multifamily debt refers reallocated from FmHA mortgage pools to FmHA mortgage holdings in 1986:4, to loans on structures of five or more units. because of accounting changes by the Farmers Home Administration. 2. Includes loans held by nondeposit trust companies but not bank trust 6. Outstanding principal balances of mortgage pools backing securities insured departments. or guaranteed by the agency indicated. Includes private pools which are not 3. Includes savings banks and savings and loan associations. Beginning 1987:1, shown as a separate line item. data reported by FSLIC-insured institutions include loans in process and other 7. Other holders include mortgage companies, real estate investment trusts, contra assets (credit balance accounts that must be subtracted from the corre- state and local credit agencies, state and local retirement funds, noninsured sponding gross asset categories to yield net asset levels). pension funds, credit unions, and other U.S. agencies. 4. Assumed to be entirely 1- to 4-family loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Consumer Installment Credit A39 1.55 CONSUMER INSTALLMENT CREDIT1 Total Outstanding, and Net Change, seasonally adjusted Millions of dollars 1989 HHoollddeerr,, aanndd ttyyppee ooff ccrreeddiitt 11998877 11998888 Feb. Mar. Apr. May June July Aug. Sept/ Oct. Amounts outstanding (end of period) 1 Total 607,721 659,507 687,397 691,162 693,911 698,132 700,849 700,344 703,001 704,371 707,706 By major holder 2 Commercial banks 282,910 318,925 318,423 318,242 320,458 323,363 324,438 323,621 326,135 327,327 330,713 3 Finance companies 140,281 145,180 143,419 143,070 144,378 145,523 146,055 145,488 144,386 144,188 141,273 4 Credit unions 80,087 86,118 87,813 88,514 89,330 89,890 90,073 89,852 90,016 89,892 90,010 5 Retailers 40,975 43,498 41,052 41,300 41,301 41,323 41,649 41,798 41,989 42,221 42,319 6 Savings institutions 59,851 62,099 63,109 62,735 61,919 61,311 59,920 60,092 59,229 59,883 58,912 7 Gasoline companies 3,618 3,687 3,677 3,682 3,787 3,897 4,017 3,936 3,976 3,886 3,804 8 Pools of securitized assets4 n.a. n.a. 29,903 33,619 32,737 32,826 34,696 35,557 37,270 36,974 40,675 By major type of credit 9 Automobile 265,976 281,174 288,767 288,850 289,654 290,741 290,192 288,526 288,533 228877,,775544 228888,,884455 10 Commercial banks 109,201 123,259 122,983 123,062 123,878 125,118 125,592 124,881 126,597 126,759 128,255 11 Credit unions 40,351 41,326 41,964 42,211 42,510 42,687 42,684 42,624 42,747 42,733 42,834 12 Finance companies 98,195 97,204 88,789 89,567 90,268 90,976 91,184 90,213 89,439 88,317 84,814 13 Savings institutions 18,228 19,385 19,464 19,231 18,866 18,566 18,032 17,972 17,603 17,990 17,699 14 Pools of securitized assets n.a. n.a. 15,568 14,779 14,132 13,395 12,700 12,835 12,147 11,955 15,243 15 Revolving 153,884 174,792 178,570 182,831 184,500 186,502 189,622 191,028 194,398 195,302 1%,339 16 Commercial banks 99,119 117,572 111,706 112,553 114,130 115,407 115,561 115,967 117,012 117,868 118,748 17 Retailers 36,389 38,692 36,257 36,489 36,497 36,504 36,814 36,963 37,134 37,355 37,435 18 Gasoline companies 3,618 3,687 3,677 3,682 3,787 3,897 4,017 3,936 3,976 3,886 3,804 19 Savings institutions 10,367 10,151 10,722 10,860 10,918 11,008 10,951 11,176 11,206 11,183 11,002 2.0 Credit unions 4,391 4,691 4,866 4,947 5,035 5,109 5,187 n.a. n.a. n.a. n.a. 21 Pools of securitized assets n.a. n.a. 11,342 14,299 14,134 14,578 17,117 17,795 19,827 19,731 20,021 77 Mobile home 26,387 25,744 25,992 24,168 23,993 23,952 23,685 23,630 22,938 22,991 22,%5 73 Commercial banks 9,220 8,974 8,974 8,844 8,836 8,878 8,847 8,830 8,808 8,788 8,739 24 Finance companies 7,762 7,186 7,308 5,687 5,659 5,684 5,674 5,624 5,100 5,087 5,272 25 Savings institutions 9,406 9,583 9,710 9,637 9,498 9,390 9,163 9,176 9,030 9,116 8,955 76 Other 161,475 177,798 194,068 195,314 195,763 196,936 197,349 197,161 197,132 198,324 199,557 77 Commercial banks 65,370 69,120 74,760 73,783 73,614 73,960 74,438 73,944 73,718 73,912 74,971 78 Finance companies 34,324 40,790 47,322 47,816 48,451 48,863 49,197 49,650 49,847 50,784 51,187 79 Credit unions 35,344 40,102 40,983 41,357 41,785 42,094 42,228 42,036 42,025 41,880 41,848 30 Retailers 4,586 4,807 4,795 4,811 4,804 4,819 4,834 4,835 4,855 4,866 4,884 31 Savings institutions 21,850 22,981 23,214 23,006 22,638 22,347 21,773 21,769 21,390 21,593 21,257 32 Pools of securitized assets n.a. n.a. 2,993 4,541 4,471 4,853 4,879 4,927 5,2% 5,288 5,411 Net change (during period) 33 Total 35,674 51,786 5,376 3,765 2,749 4,221 2,717 -505 2,657 1,371 3,335 By major holder 34 Commercial banks 19,884 36,015 1,626 -181 2,216 2,904 1,076 -817 2,514 1,192 3,386 35 Finance companies 6,349 4,899 1,624 -349 1,309 1,145 532 -567 -1,102 -198 -2,915 36 Credit unions 3,853 6,031 720 701 815 560 184 -222 164 -124 118 37 Retailers 1,568 2,523 67 247 2 21 326 149 192 231 98 38 Savings institutions 3,689 2,248 242 -375 -815 -609 -1,390 172 -863 654 -971 39 Gasoline companies 332 69 22 6 104 110 120 -81 39 -89 -82 40 Pools of securitized assets n.a. n.a. 1,076 3,716 -882 89 1,870 861 1,713 -296 3,701 By major type of credit 41 Automobile 18,663 15,198 2,385 82 804 1,087 -549 -1,667 7 -779 1,091 42 Commercial banks 7,919 14,058 823 79 816 1,239 474 -711 1,716 162 1,4% 43 Credit unions 1,916 975 257 247 300 177 -3 -60 123 -14 101 44 Finance companies 5,639 -991 821 778 701 708 208 -970 -775 -1,122 -3,503 45 Savings institutions 3,188 1,157 -42 -233 -366 -300 -533 -61 -369 387 -292 46 Pools of securitized assets n.a. n.a. 526 -789 -647 -737 -695 135 -688 -192 3,288 47 Revolving 16,871 20,908 1,854 4,261 1,670 2,002 3,120 1,406 3,370 904 1,036 48 Commercial banks 12,188 18,453 573 848 1,576 1,277 154 405 1,045 856 880 49 Retailers 1,866 2,303 81 232 8 7 310 149 171 221 80 50 Gasoline companies 332 69 22 6 104 110 120 -81 39 -89 -82 51 Savings institutions 1,771 -216 243 138 58 90 -57 225 30 -22 -181 52 Credit unions 715 300 81 81 88 74 78 n.a. n.a. n.a. n.a. 53 Pools of securitized assets n.a. n.a. 853 2,957 -165 444 2,539 678 2,032 -% 290 54 Mobile home -968 -643 -44 -1,824 -174 -41 -267 -56 -692 53 -26 55 Commercial banks 192 -246 1 -131 -7 42 -31 -18 -22 -20 -49 56 Finance companies -1,052 -576 -68 -1,621 -28 25 -10 -50 -524 -13 185 57 Savings institutions -107 177 23 -72 -140 -108 -227 12 -146 86 -161 58 Other 1,108 16,323 1,182 1,246 449 1,173 413 -189 -29 1,192 1,233 59 Commercial banks -415 3,750 229 -977 -169 346 478 -494 -226 194 1,059 60 Finance companies 1,761 6,466 871 494 635 412 334 453 197 937 403 61 Credit unions 1,221 4,758 382 374 428 309 133 -191 -11 -145 -33 62 Retailers -297 221 -14 16 -7 15 16 0 21 11 18 63 Savings institutions -1,162 1,131 18 -208 -368 -291 -574 -5 -379 203 -336 64 Pools of securitized assets n.a. n.a. -303 1,548 -70 382 26 48 369 -8 123 1. The Board's series cover most short- and intermediate-term credit extended 2. More detail for finance companies is available in the G. 20 statistical release. to individuals that is scheduled to be repaid (or has the option of repayment) in 3. Excludes 30-day charge credit held by travel and entertainment companies. two or more installments. 4. Outstanding balances of pools upon which securities have been issued; these These data also appear in the Board's G.19 (421) release. For address, see balances are no longer carried on the balance sheets of the loan originator. inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A40 DomesticN onfinancial Statistics • February 1990 1.56 TERMS OF CONSUMER INSTALLMENT CREDIT1 Percent unless noted otherwise 1989 Item 1986 1988 Apr. May June July Aug. Sept. INTEREST RATES Commercial banks2 1 48-month new car3 11.33 10.45 10.85 n.a. 12.44 n.a. n.a. 12.13 n.a. 2 3 2 1 4 2 - 0 m -m on o t n h t h p m er o so b n il a e l home3 1 1 4 3 . . 8 9 2 9 1 1 4 3 . . 2 3 2 8 1 13 4 . . 5 6 4 8 n n . . a a . . 1 1 5 4 . . 6 3 5 5 n n . . a a . . n n . . a a . . 1 1 5 4 . . 4 1 5 3 n n . . a a . . 4 Credit card 18.26 17.92 17.78 n.a. 18.11 n.a. n.a. 18.07 n.a. Auto finance companies 5 New car 9.44 10.73 12.60 12.10 11.80 11.96 11.94 12.22 12.42 6 Used car 15.95 14.60 15.11 16.39 16.45 16.45 16.37 16.31 16.22 OTHER TERMS4 Maturity (months) 7 New car 50.0 53.5 56.2 53.4 52.7 53.0 52.9 52.9 53.1 8 Used car 42.6 45.2 46.7 47.8 46.6 46.5 46.4 46.2 46.2r Loan-to-value ratio 9 New car 93 91 10 Used car 97 96 Amount financed (dollars) 11 New car 10,665 11,203 11,663 11,886 11,973 12,065 12,108 11,949 11,841 12 Used car 6,555 7,420 7,824 7,855 7,908 7,921 7,988 7,874 7,856 1. These data also appear in the Board's G.19 (421) release. For address, see 3. Before 1983 the maturity for new car loans was 36 months, and for mobile inside front cover. home loans was 84 months. 2. Data for midmonth of quarter only. 4. At auto finance companies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A41 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1988 1989 TTrraannssaaccttiioonn ccaatteeggoorryy,, sseeccttoorr 11998855 11998866 11998877 11998888 Qi Q2 Q3 Q4 Ql Q2 Q3 Nonfinancial sectors 1 Total net borrowing by domestic nonfinancial sectors 750.7 846.3 831.1 693.2 767.0 728.2 827.2 754.4 758.3 792.2 658.9 688.1 By sector and instrument 2 U.S. government 198.8 223.6 215.0 144.9 157.5 211.6 113.7 162.5 142.1 199.9 70.9 149.0 3 Treasury securities 199.0 223.7 214.7 143.4 140.0 212.0 106.0 141.6 100.5 201.1 65.8 149.1 4 Agency issues and mortgages -.2 -.1 .4 1.5 17.4 -.5 7.7 20.9 41.6 -1.2 5.1 -.2 5 Private domestic nonfinancial sectors 551.9 622.7 616.1 548.3 609.6 516.6 713.4 592.0 616.3 592.3 588.0 539.1 6 Debt capital instruments 320.0 451.4 460.3 458.5 462.6 386.5 561.0 463.9 438.9 427.8 394.1 412.6 7 Tax-exempt obligations 51.0 135.4 22.7 34.1 34.0 29.1 37.9 34.8 34.3 29.3 20.6 32.6 8 Corporate bonds 46.1 73.8 121.3 99.9 120.9 118.8 143.9 115.9 104.9 111.6 138.5 113.6 9 Mortgages 222.8 242.2 316.3 324.5 307.7 238.7 379.2 313.2 299.7 286.9 234.9 266.4 10 Home mortgages 136.7 156.8 218.7 234.9 229.1 170.7 300.7 231.0 214.0 205.2 186.1 191.9 11 Multifamily residential 25.2 29.8 33.5 24.4 18.9 24.2 14.7 19.5 17.3 27.2 8.1 21.3 12 Commercial 62.2 62.2 73.6 71.6 61.7 48.5 65.4 65.4 67.7 58.8 38.7 53.2 13 Farm -1.2 -6.6 -9.5 -6.4 -2.1 -4.7 -1.6 -2.6 .7 -4.4 2.1 .0 14 Other debt instruments 231.9 171.3 155.8 89.7 147.0 130.1 152.4 128.1 177.3 164.5 193.9 126.5 15 Consumer credit 81.6 82.5 58.0 32.9 51.1 43.7 51.9 35.5 73.1 34.8 46.0 30.9 16 Bank loans n.e.c 66.3 38.6 66.7 10.8 38.4 20.8 58.8 7.3 66.6 23.1 29.9 21.6 17 Open market paper 21.7 14.6 -9.3 2.3 11.6 2.4 6.8 17.1 20.0 44.1 44.9 20.4 18 Other 62.2 35.6 40.5 43.8 45.9 63.2 34.8 68.1 17.6 62.5 73.1 53.6 19 By borrowing sector 551.9 622.7 616.1 548.3 609.6 516.6 713.4 592.0 616.3 592.3 588.0 539.1 20 State and local governments 28.1 90.9 36.2 33.6 29.8 23.4 37.0 28.1 30.6 29.7 27.7 29.5 21 Households 231.5 284.6 289.2 271.9 287.9 230.2 346.7 291.6 283.3 263.1 227.1 254.8 22 Nonfinancial business 292.3 247.2 290.7 242.8 291.8 263.0 329.7 272.3 302.4 299.4 333.3 254.9 23 Farm -.4 -14.5 -16.3 -10.6 -7.5 -12.7 -3.3 -2.2 -11.8 -2.2 .3 2.8 24 Nonfarm noncorporate 123.2 129.3 103.2 107.9 91.9 85.2 83.6 100.5 98.2 91.1 70.0 81.7 25 Corporate 169.6 132.4 203.7 145.5 207.5 190.5 249.4 174.0 216.0 210.6 263.0 170.4 26 Foreign net borrowing in United States 8.4 1.2 9.7 4.9 6.9 4.8 5.4 4.1 13.3 -1.1 -3.9 28.7 27 Bonds 3.8 3.8 3.1 7.4 6.9 14.2 2.6 5.9 5.1 3.2 11.1 9.1 28 Bank loans n.e.c -6.6 -2.8 -1.0 -3.6 -1.8 1.7 -3.3 .0 -5.7 4.9 1.7 .0 29 Open market paper 6.2 6.2 11.5 2.1 9.6 .7 6.5 10.3 21.0 12.1 -8.1 20.4 30 U.S. government loans 5.0 -6.0 -3.9 -1.0 -7.8 -11.8 -.4 -12.1 -7.1 -21.4 -8.6 -.9 31 Total domestic plus foreign 759.1 847.5 840.9 698.1 773.9 733.0 832.6 758.5 771.7 791.1 655.0 716.8 Financial sectors 32 Total net borrowing by financial sectors 150.7 201.3 318.9 315.0 264.2 242.5 263.9 232.1 318.3 394.4 123.4 152.5 By instrument 33 U.S. government related 74.9 101.5 187.9 185.8 137.5 128.8 104.3 144.4 172.5 216.1 105.8 137.4 34 Sponsored credit agency securities 30.4 20.6 15.2 30.2 44.9 59.5 11.1 46.5 62.3 84.9 12.5 10.0 35 Mortgage pool securities 44.4 79.9 173.1 156.4 92.6 69.3 93.1 97.8 110.1 131.2 93.3 127.4 36 Loans from U.S. government .0 1.1 -.4 -.8 .0 .0 .0 .0 .0 .0 .0 .0 37 Private financial sectors 75.9 99.7 131.0 129.2 126.7 113.7 159.6 87.7 145.8 178.3 17.6 15.1 38 Corporate bonds 34.3 50.9 82.9 78.9 51.7 60.0 71.1 32.5 43.0 52.7 31.4 26.4 39 Mortgages .4 .1 .1 .4 .3 -.1 .1 -.1 1.2 .3 .0 .0 40 Bank loans n.e.c 1.4 2.6 4.0 -3.3 1.4 5.9 5.7 -5.6 -.3 3.0 .3 4.1 41 Open market paper 24.0 32.0 24.2 28.8 53.6 38.5 70.5 35.1 70.4 53.2 2.8 28.2 42 Loans from Federal Home Loan Banks 15.7 14.2 19.8 24.4 19.7 9.4 12.3 25.8 31.4 69.1 -16.9 -43.7 By sector 43 150.7 201.3 318.9 315.0 264.2 242.5 263.9 232.1 318.3 394.4 123.4 152.5 44 Sponsored credit agencies 30.4 21.7 14.9 29.5 44.9 59.5 11.1 46.5 62.3 84.9 12.5 10.0 45 Mortgage pools 44.4 79.9 173.1 156.4 92.6 69.3 93.1 97.8 110.1 131.2 93.3 127.4 46 Private financial sectors 75.9 99.7 131.0 129.2 126.7 113.7 159.6 87.7 145.8 178.3 17.6 15.1 47 Commercial banks 7.3 -4.9 -3.6 7.1 -3.9 -16.7 -1.6 -.9 3.7 -13.4 -.9 7.5 48 Bank affiliates 16.1 16.6 15.2 14.3 5.2 -8.8 22.4 6.1 .8 6.4 6.5 6.7 49 Savings and loan associations 17.2 17.3 20.9 19.6 19.9 10.0 19.1 24.1 26.3 71.3 -16.2 -43.9 50 Mutual savings banks 1.2 1.5 4.2 8.1 1.9 2.3 1.1 .5 3.8 -2.8 -1.1 -2.9 51 Finance companies 24.0 57.2 54.5 40.3 67.0 78.4 85.4 40.7 63.6 78.4 32.8 43.2 52 REITs .8 .5 1.0 .8 4.1 5.4 1.7 -5.9 15.0 -.9 -2.2 -1.4 53 SCO Issuers 9.3 11.5 39.0 39.1 32.5 43.0 31.5 23.1 32.5 39.3 -1.4 5.9 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A42 DomesticN onfinancial Statistics • February 1990 1.57—Continued 1988 1989 TTrraannssaaccttiioonn ccaatteeggoorryy,, sseeccttoorr 11998844 11998855 11998866 11998877 11998888 Q1 Q2 Q3 Q4 Q1 Q2 Q3 All sectors 54 Total net borrowing 909.8 1,048.8 1,159.8 1,013.2 1,038.1 975.5 1,096.5 990.6 1,089.9 1,185.4 778.4 869.3 55 U.S. government securities 273.8 324.2 403.4 331.5 294.9 340.4 218.0 306.8 314.6 416.0 176.7 286.4 56 State and local obligations 51.0 135.4 22.7 34.1 34.0 29.1 37.9 34.8 34.3 29.3 20.6 32.6 57 Corporate and foreign bonds 84.3 128.4 207.3 186.3 179.5 193.0 217.6 154.3 153.0 167.5 181.1 149.2 58 Mortgages 223.1 242.2 316.4 324.9 308.0 238.6 379.3 313.1 300.8 287.2 234.9 266.4 59 Consumer credit 81.6 82.5 58.0 32.9 51.1 43.7 51.9 35.5 73.1 34.8 46.0 30.9 60 Bank loans n.e.c 61.1 38.3 69.7 3.8 38.0 28.3 61.2 1.7 60.7 31.1 31.9 25.8 61 Open market paper 51.9 52.8 26.4 33.2 74.9 41.6 83.9 62.5 111.5 109.4 39.6 69.0 62 Other loans 82.9 45.0 56.1 66.5 57.8 60.8 46.8 81.8 42.0 110.2 47.5 9.1 63 MEMO: U.S. government, cash balance 6.3 14.4 .0 -7.9 10.4 47.6 1.2 10.6 -17.9 -22.5 43.7 -7.5 Totals net of changes in U.S. government cash balances 64 Net borrowing by domestic nonfinancial 744.4 831.9 831.2 701.1 756.6 680.6 825.9 743.8 776.3 814.7 615.2 695.6 65 Net borrowing by U.S. government 192.5 209.3 215.0 152.8 147.1 164.0 112.5 151.8 160.0 222.4 27.2 156.4 External corporate equity funds raised in United States 66 Total net share issues -36.0 20.1 90.5 14.3 -117.9 -101.0 -133.7 -73.5 -163.5 -163.5 -48.7 -64.7 67 Mutual funds 29.3 84.4 159.0 71.6 -.7 -9.5 -6.6 1.5 11.9 3.6 24.0 50.0 68 All other -65.3 -64.3 -68.5 -57.3 -117.2 -91.5 -127.0 -75.0 -175.4 -167.1 -72.7 -114.6 69 Nonfinancial corporations -74.5 -81.5 -80.8 -76.5 -130.5 -95.0 -140.0 -92.0 -195.0 -180.0 -105.0 -145.0 70 Financial corporations 8.2 13.5 11.1 21.4 12.4 2.4 19.0 14.6 13.5 9.4 17.1 17.1 71 Foreign shares purchased in United States .9 3.7 1.2 -2.1 .9 1.1 -6.0 2.4 6.1 3.6 15.2 13.3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A43 1.58 DIRECT AND INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS Billions of dollars, except as noted; quarterly data are at seasonally adjusted annual rates. 1988 1989 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 11998844 11998855 11998866 11998877 11998888 Ql Q2 Q3 Q4 Ql Q2 Q3 1 Total funds advanced in credit markets to domestic nonfinancial sectors 750.7 846.3 831.1 693.2 767.0 728.2 827.2 754.4 758.3 792.2 658.9 688.1 By public agencies and foreign 2 Total net advances 157.6 202.0 314.0 262.8 237.6 278.6 185.5 196.9 289.3 348.7 26.7 267.4 3 U.S. government securities 38.9 45.9 69.4 70.1 85.0 153.2 43.3 24.1 119.6 97.6 -102.4 117.1 4 Residential mortgages 56.5 94.6 170.1 153.2 104.0 88.9 107.9 98.1 121.2 133.3 106.6 149.0 5 FHLB advances to thrifts 15.7 14.2 19.8 24.4 19.7 9.4 12.3 25.8 31.4 69.1 -16.9 -43.7 6 Other loans and securities 46.6 47.3 54.7 15.1 28.8 27.1 22.1 49.0 17.1 48.7 39.4 45.0 Total advanced, by sector 7 U.S. government 17.1 17.8 9.7 -7.9 -4.9 -7.0 -7.6 4.3 -9.3 2.8 3.1 5.2 8 Sponsored credit agencies 74.3 103.5 187.2 183.4 129.6^ 114.3 105.7 130.1 168.5 221.4 15.6 165.6 9 Monetary authorities 8.4 18.4 19.4 24.7 10.5 2.7 5.0 15.5 18.9 5.2 -3.9 -30.7 10 Foreign 57.9 62.3 97.8 62.7 102.3 168.6 82.5 47.0 111.2 119.3 11.9 127.2 Agency and foreign borrowing not in line 1 11 Sponsored credit agencies and mortgage pools 74.9 101.5 187.9 185.8 137.5 128.8 104.3 144.4 172.5 216.1 110055..88 137.4 12 Foreign 8.4 1.2 9.7 4.9 6.9 4.8 5.4 4.1 13.3 -1.1 -3.9 28.7 Private domestic funds advanced 13 Total net advances 676.3 747.0 714.8 621.1 673.8 583.2 751.3 705.9 654.8 658.4 734.1 586.8 14 U.S. government securities 234.9 278.2 333.9 261.4 209.9 187.2 174.7 282.8 195.0 318.4 279.1 169.3 15 State and local obligations 51.0 135.4 22.7 34.1 34.0 29.1 37.9 34.8 34.3 29.3 20.6 32.6 16 Corporate and foreign bonds 35.1 40.8 84.2 87.5 104.4 126.5 126.2 91.7 73.0 89.4 132.3 103.4 17 Residential mortgages 105.3 91.8 82.0 106.1 144.0 106.0 207.5 152.3 110.1 99.2 87.5 64.2 18 Other mortgages and loans 265.6 214.8 211.8 156.5 201.2 143.8 217.2 170.1 273.7 191.3 197.7 173.6 19 LESS: Federal Home Loan Bank advances 15.7 14.2 19.8 24.4 19.7 9.4 12.3 25.8 31.4 69.1 -16.9 -43.7 Private financial intermediation 20 Credit market funds advanced by private financial institutions 585.8 579.9 744.0 560.8 558.2 617.4 553.7 427.5 634.1 568.6 544.3 342.2 21 Commercial banking 169.2 186.0 197.5 136.8 155.3 87.9 194.5 118.4 220.5 120.6 158.6 132.9 22 Savings institutions 154.7 87.9 107.6 136.8 120.5 96.0 134.9 157.0 94.2 62.2 -73.1 -154.2 23 Insurance and pension funds 121.8 154.4 174.6 210.9 194.9 257.4 182.7 150.5 189.1 228.3 182.5 156.0 24 Other finance 140.1 151.6 264.2 76.3 87.4 176.1 41.6 1.7 130.3 157.6 276.2 207.4 25 Sources of funds 585.8 579.9 744.0 560.8 558.2 617.4 553.7 427.5 634.1 568.6 544.3 342.2 26 Private domestic deposits and RPs 322.6 214.3 262.6 144.1 219.2 305.5 102.0 191.9 277.4 166.5 213.4 282.7 27 Credit market borrowing 75.9 99.7 131.0 129.2 126.7 113.7 159.6 87.7 145.8 178.3 17.6 15.1 28 Other sources 187.3 265.9 350.4 287.5 212.3 198.2 292.1 147.9 210.9 223.8 313.3 44.3 29 Foreign funds 8.8 19.7 12.9 43.7 9.3 -60.6 94.5 -42.1 45.5 -28.4 -16.0 10.6 30 Treasury balances 4.0 10.3 1.7 -5.8 7.3 44.2 -16.3 5.6 -4.1 -21.6 26.6 -6.4 31 Insurance and pension reserves 124.0 131.9 149.3 176.1 186.8 190.1 184.0 109.8 263.3 133.0 151.5 88.7 32 Other, net 50.5 104.1 186.5 73.6 8.8 24.4 29.9 74.5 -93.8 140.8 151.2 -48.6 Private domestic nonfinancial investors 33 Direct lending in credit markets 166.4 266.8 101.8 189.6 242.3 79.5 357.2 366.2 166.5 268.1 207.5 259.7 34 U.S. government securities 111.4 157.8 60.9 100.0 149.3 119.6 103.2 225.7 148.7 211.1 123.2 137.4 35 State and local obligations 27.1 37.7 -21.7 45.6 33.9 19.7 37.2 56.4 22.3 35.7 -11.4 22.6 36 Corporate and foreign bonds -4.1 4.2 39.3 24.1 2.6 -39.6 61.4 -5.8 -5.7 -15.4 32.8 21.2 37 Open market paper 7.8 47.5 5.4 6.6 37.2 -14.5 98.6 77.4 -12.6 67.1 19.5 43.4 38 Other 24.2 19.6 17.9 13.3 19.3 -5.8 56.8 12.5 13.9 -30.3 43.4 35.1 39 Deposits and currency 326.1 224.6 283.0 160.2 221.8 313.5 110.0 215.7 248.2 211.2 231.1 273.2 40 Currency 8.6 12.4 14.4 19.0 14.7 10.7 13.8 29.3 5.1 19.3 12.6 11.4 41 Checkable deposits 30.2 41.9 95.0 -3.0 12.3 3.6 -30.5 -21.4 97.3 -54.5 -83.0 35.4 42 Small time and savings accounts 150.7 138.5 120.6 76.0 122.2 199.5 130.5 72.7 86.0 26.4 117.4 119.1 43 Money market fund shares 49.0 8.9 38.3 27.2 22.8 57.6 -21.0 -3.5 58.1 51.1 111.8 124.3 44 Large time deposits 82.9 7.4 -11.4 26.7 40.8 16.9 -3.5 137.0 12.7 111.9 39.8 -15.4 45 Security RPs 9.8 17.7 20.2 17.2 21.2 27.9 26.5 7.0 23.3 31.6 27.5 19.4 46 Deposits in foreign countries -5.1 -2.1 5.9 -2.8 -12.1 -2.7 -5.9 -5.5 -34.4 25.5 5.1 -20.9 47 Total of credit market instruments, deposits, and currency 492.5 491.4 384.8 349.8 464.2 393.0 467.2 581.9 414.7 479.4 438.6 532.9 48 Public holdings as percent of total 20.8 23.8 37.3 37.6 30.7 38.0 22.3 26.0 37.5 44.1 4.1 37.3 49 Private financial intermediation (in percent) 86.6r 77.6 104.1 90.3 82.8 105.9 73.7 60.6 96.8 86.4 74.1 58.3 50 Total foreign funds 66.7 82.0 110.7 106.4 111.7 108.1 177.0 4.9 156.7 90.9 -4.1 137.8 MEMO: Corporate equities not included above 51 Total net issues -36.0 20.1 90.5 14.3 -117.9 -101.0 -133.7 -73.5 -163.5 -163.5 -48.7 -64.7 5? Mutual fund shares 29.3 84.4 159.0 71.6 -.7 -9.5 -6.6 1.5 11.9 3.6 24.0 50.0 53 Other equities -65.3 -64.3 -68.5 -57.3 -117.2 -91.5 -127.0 -75.0 -175.4 -167.1 -72.7 -114.6 54 Acquisitions by financial institutions 15.8 45.6 53.7 21.4 5.4 -34.4 .2 25.5 30.1 -6.5 -6.5 3.8 55 Other net purchases -51.8 -25.5 36.8 -7.1 -123.3 -66.5 -133.9 -99.1 -193.6 -157.0 -42.2 -68.4 NOTES BY LINE NUMBER. 31. Excludes net investment of these reserves in corporate equities. 1. Line 1 of table 1.57. 32. Mainly retained earnings and net miscellaneous liabilities. 2. Sum of lines 3-6 or 7-10. 33. Line 13 less line 20 plus line 27. 6. Includes farm and commercial mortgages. 34-38. Lines 14-18 less amounts acquired by private finance plus amounts 11. Credit market funds raised by federally sponsored credit agencies, and net borrowed by private finance. Line 38 includes mortgages. issues of federally related mortgage pool securities. 40. Mainly an offset to line 9. 13. Line 1 less line 2 plus line 11 and 12. Also line 20 less line 27 plus line 33. 47. Lines 33 plus 39, or line 13 less line 28 plus 40 and 46. Also sum of lines 28 and 47 less lines 40 and 46. 48. Line 2/line 1. 18. Includes farm and commercial mortgages. 49. Line 20/line 13. 26. Line 39 less lines 40 and 46. 50. Sum of lines 10 and 29. 27. Excludes equity issues and investment company shares. Includes line 19. 51. 53. Includes issues by financial institutions. 29. Foreign deposits at commercial banks, bank borrowings from foreign NOTE. Full statements for sectors and transaction types in flows and in amounts branches, and liabilities of foreign banking agencies to foreign affiliates, less outstanding may be obtained from Flow of Funds Section, Division of Research claims on foreign affiliates and deposits by banking in foreign banks. and Statistics, Board of Governors of the Federal Reserve System, Washington, 30. Demand deposits and note balances at commercial banks. D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A44 Domestic Nonfinancial Statistics • February 1990 1.59 SUMMARY OF CREDIT MARKET DEBT OUTSTANDING Billions of dollars; period-end levels. 1988 1989 TTrraannssaaccttiioonn ccaatteeggoorryy,, sseeccttoorr 11998844 11998855 11998866 11998877 Ql Q2 Q3 Q4 Ql Q2 Q3 Nonfinancial sectors 1 Total credit market debt owed by domestic nonfinancial sectors 5,951.8 6,795.1 7,631.2 8,335.0 8,477.0 8,686.9 8,875.4 9,105.6 9,258.7 9,428.4 9,604.5 By sector and instrument 2 U.S. government 1,376.8 1,600.4 1,815.4 1,960.3 2,003.2 2,022.3 2,063.9 2,117.8 2,155.7 2,165.7 2,204.3 3 Treasury securities 1,373.4 1,597.1 1,811.7 1,955.2 1,998.1 2,015.3 2,051.7 2,095.2 2,133.4 2,142.1 2,180.7 4 Agency issues and mortgages 3.4 3.3 3.6 5.2 5.0 7.0 12.2 22.6 22.3 23.6 23.5 5 Private domestic nonfinancial sectors 4.575.1 5,194.7 5,815.8 6,374.7 6,473.8 6,664.7 6,811.5 6,987.8 7,103.0 7,262.7 7,400.2 6 Debt capital instruments 3,038.0 3,485.5 3,957.5 4.428.0 4.511.0 4.652.6 4,782.0 4.902.1 4,979.2 5.078.3 5,187.8 7 Tax-exempt obligations 520.0 655.5 679.1 713.2 718.1 727.2 746.1 759.8 764.7 769.3 780.3 8 Corporate bonds 469.2 542.9 664.2 764.1 793.8 829.8 858.8 885.0 912.9 947.5 975.9 9 Mortgages 2,048.8 2.287.1 2,614.2 2,950.7 2.999.1 3.095.7 3,177.2 3,257.3 3,301.6 3,361.6 3.431.6 10 Home mortgages 1.336.2 1.490.2 1,720.8 1.943.1 1,978.0 2,055.3 2,118.0 2.174.2 2,214.8 2.263.4 2.316.7 11 Multifamily residential 183.6 213.0 246.2 270.0 273.0 276.6 281.0 286.8 292.6 294.4 299.3 12 Commercial 416.5 478.1 551.4 648.7 660.2 676.0 691.1 709.6 708.2 717.0 728.9 13 Farm 112.4 105.9 95.8 88.9 88.0 87.8 87.0 86.8 86.0 86.7 86.6 14 Other debt instruments 1,537.1 1,709.3 1,858.4 1,946.7 1,962.8 2,012.0 2,029.4 2,085.7 2,123.8 2,184.3 2,212.4 15 Consumer credit 519.3 601.8 659.8 692.7 688.9 705.8 721.2 743.7 745.0 761.0 775.3 16 Bank loans n.e.c 553.1 592.7 656.1 664.3 668.3 687.2 687.7 702.6 717.6 729.8 734.5 17 Open market paper 58.5 72.2 62.9 73.8 73.5 77.8 80.3 85.4 96.1 110.1 113.1 18 Other 406.2 442.6 479.6 516.0 532.1 541.2 540.2 554.0 565.1 583.5 589.5 19 By borrowing sector 4.575.1 5,194.7 5,815.8 6,374.7 6,473.8 6,664.7 6,811.5 6,987.8 7,103.0 7,262.7 7,400.2 20 State and local governments 383.0 473.9 510.1 543.7 547.1 556.0 565.7 573.5 578.5 584.8 595.1 21 Households 2.018.2 2.295.5 2,591.8 2,864.5 2,900.7 2,990.2 3,068.3 3,152.0 3,205.6 3,265.5 3,336.1 22 Nonfinancial business 2,173.9 2,425.4 2,714.0 2.966.5 3,026.0 3,118.5 3.177.5 3.262.4 3.319.0 3,412.3 3,469.0 23 Farm 187.9 173.4 156.6 145.5 141.3 143.9 143.6 137.6 135.9 139.5 140.7 24 Nonfarm noncorporate 769.0 898.3 1,001.6 1,109.4 1,131.7 1,151.9 1.172.6 1,205.3 1.229.1 1,245.9 1,261.6 25 Corporate 1,216.9 1.353.6 1,555.8 1.711.6 1,753.0 1,822.7 1,861.3 1.919.5 1,954.0 2,027.0 2,066.6 26 Foreign credit market debt held in United States 233.6 234.7 236.4 242.9 244.6 245.9 246.1 249.6 249.9 249.0 255.3 27 Bonds 68.0 71.8 74.9 82.3 86.1 86.0 87.4 89.2 90.5 92.2 94.5 28 Bank loans n.e.c 30.8 27.9 26.9 23.3 22.8 22.4 22.7 21.5 21.6 22.7 22.9 29 Open market paper 27.7 33.9 37.4 41.2 42.5 44.0 46.3 50.9 54.9 52.7 57.5 30 U.S. government loans 107.1 101.1 97.1 96.1 93.1 93.5 89.8 88.1 83.0 81.4 80.4 31 Total domestic plus foreign 6,185.4 7,029.9 7,867.6 8,578.0 8,721.6 8,932.8 9,121.5 9,355.3 9,508.7 9,677.4 9,859.7 Financial sectors 32 Total credit market debt owed by financial sectors 1,010.2 1,213.2 1,563.6 1,885.5 1,926.0 2,000.5 2,058.2 2,149.7 2,258.7 2,298.9 2,336.7 By instrument 33 U.S. government related 531.2 632.7 844.2 1,026.5 1,050.6 1,076.9 1,116.3 1,164.0 1,209.0 1,235.8 1,273.8 34 Sponsored credit agency securities 237.2 257.8 273.0 303.2 313.5 317.9 328.5 348.1 364.3 369.0 370.4 35 Mortgage pool securities 289.0 368.9 565.4 718.3 732.1 754.0 782.8 810.9 839.7 861.8 898.4 36 Loans from U.S. government 5.0 6.1 5.7 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 37 Private financial sectors 479.0 580.5 719.5 859.0 875.4 923.6 941.9 985.7 1,049.7 1,063.1 1,062.9 38 Corporate bonds 153.0 204.5 287.4 366.3 380.5 397.9 406.4 418.0 458.2 465.8 472.8 39 Mortgages 2.5 2.7 2.7 3.1 3.1 3.1 3.1 3.4 3.5 3.5 3.5 40 Bank loans n.e.c 29.5 32.1 36.1 32.8 31.7 34.3 32.9 34.2 32.2 33.8 34.7 41 Open market paper 219.5 252.4 284.6 323.8 330.6 353.4 358.0 377.4 392.0 398.3 400.9 42 Loans from Federal Home Loan Banks 74.6 88.8 108.6 133.1 129.5 134.8 141.6 152.8 163.8 161.9 151.1 43 Total, by sector , 1,010.2 1,213.2 1,563.6 1,885.5 1,926.0 2,000.5 2,058.2 2,149.7 2,258.7 2,298.9 2,336.7 44 Sponsored credit agencies 242.2 263.9 278.7 308.2 318.5 322.9 333.5 353.1 369.3 374.0 375.4 45 Mortgage pools 289.0 368.9 565.4 718.3 732.1 754.0 782.8 810.9 839.7 861.8 898.4 46 Private financial sectors 479.0 580.5 719.5 859.0 875.4 923.6 941.9 985.7 1,049.7 1,063.1 1,062.9 47 Commercial banks 84.1 79.2 75.6 82.7 76.4 77.2 76.6 78.8 73.3 74.5 75.8 48 Bank affiliates 89.5 106.2 116.8 131.1 131.0 136.3 136.3 136.2 140.0 141.2 141.5 49 Savings and loan associations 81.6 98.9 119.8 139.4 135.3 141.9 148.1 159.3 170.1 167.9 156.8 50 Mutual savings banks 2.9 4.4 8.6 16.7 17.1 17.6 18.1 18.6 17.8 17.7 17.6 51 Finance companies 203.0 261.2 328.1 378.8 393.0 419.8 427.7 445.8 463.8 478.0 486.3 52 REITs 4.3 5.6 6.5 7.3 8.7 9.1 7.6 11.4 11.1 10.6 10.3 53 SCO issuers 13.5 25.0 64.0 103.1 113.9 121.8 127.5 135.7 173.5 173.1 174.6 All sectors 54 Total credit market debt 7,195.7 8,243.1 9,431.2 10,463.4 10,647.5 10,933.4 11,179.7 11,504.9 11,767.4 11,976.3 12,196.4 55 U.S. government securities 1,902.8 2,227.0 2,653.8 2,981.8 3,048.8 3,094.2 3,175.2 3,276.7 3,359.7 3,396.5 3,473.1 56 State and local obligations 520.0 655.5 679.1 713.2 718.1 727.2 746.1 759.8 764.7 769.3 780.3 37 Corporate and foreign bonds 690.1 819.2 1,026.4 1,212.7 1,260.4 1,313.7 1,352.5 1,392.2 1,461.6 1,505.5 1,543.2 58 Mortgages 2,051.4 2,289.8 2,617.0 2,953.8 3,002.2 3,098.8 3,180.3 3,260.7 3,305.1 3,365.0 3,435.1 39 Consumer credit 519.3 601.8 659.8 692.7 688.9 705.8 721.2 743.7 745.0 761.0 775.3 60 Bank loans n.e.c 613.4 652.7 719.1 720.3 722.7 744.0 743.3 758.3 771.4 786.2 792.0 61 Open market paper 305.7 358.5 384.9 438.8 446.7 475.3 484.6 513.6 543.1 561.1 571.4 62 Other loans 592.9 638.6 691.1 750.2 759.7 774.5 776.6 799.8 816.8 831.7 826.0 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A45 1.60 SUMMARY OF CREDIT MARKET CLAIMS, BY HOLDER Billions of dollars, except as noted; period-end levels. 1988 1989 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 11998844 11998855 11998866 11998877 Ql Q2 Q3 Q4 Ql Q2 Q3 1 Total funds advanced in credit markets to domestic nonfinancial sectors 5,951.8 6,795.1 7,631.2 8,335.0 8,477.0 8,686.9 8,875.4 9,105.6 9,258.7 9,428.4 9,604.5 By public agencies and foreign 2 Total held 1,257.7 1,460.5 1,794.7 2,044.9 2,099.4. 2,151.3 2,191.8 2,266.4 2,332.1 2,345.1 2,414.3 3 U.S. government securities 377.9 423.8 493.2 563.3 595.7 610.1 613.3 648.3 666.2 644.6 670.7 4 Residential mortgages 423.5 518.2 712.3 862.0 880.6 906.1 934.9 966.0 995.3 1,020.5 1,062.6 5 FHLB advances to thrifts 74.6 88.8 108.6 133.1 129.5 134.8 141.6 152.8 163.8 161.9 151.1 6 Other loans and securities 381.6 429.7 480.5 486.6 493.6 500.3 502.1 499.3 506.9 518.1 529.8 7 Total held, by type of lender 1,257.7 1,460.5 1,794.7 2,044.9 2,099.4 2,151.3 2,191.8 2,266.4 2,332.1 2,345.1 2,414.3 8 U.S. government 228.2 246.7 253.3 238.0 237.1 235.8 226.3 216.9 213.9 215.2 216.9 9 Sponsored credit agencies and mortgage pools ... 556.3 659.8 869.8 1,048.9 1,068.0 1,095.6 1,132.9 1,178.6 1,223.5 1,228.9 1,275.3 10 Monetary authority 167.6 186.0 205.5 230.1 224.9 229.7 230.8 240.6 235.4 238.4 227.6 11 Foreign 305.6 367.9 466.1 527.9 569.5 590.2 601.9 630.3 659.3 662.6 694.5 Agency and foreign debt not in line 1 12 Sponsored credit agencies and mortgage pools ... 531.2 632.7 844.2 1,026.5 1,050.6 1,076.9 1,116.3 1,164.0 1,209.0 1,235.8 1,273.8 13 Foreign 233.6 234.7 236.4 242.9 244.6 245.9 246.1 249.6 249.9 249.0 255.3 Private domestic holdings 14 Total private holdings 5,458.9 6,202.1 6,917.1 7,559.5 7,672.7 7,858.4 8,045.9 8,252.8 8,385.5 8,568.1 8,719.2 15 U.S. government securities 1,524.9 1,803.2 2,160.6 2,418.5 2,453.1 2,484.1 2,561.9 2,628.4 2,693.5 2,751.9 2,802.3 16 State and local obligations 520.0 655.5 679.1 713.2 718.1 727.2 746.1 759.8 764.7 769.3 780.3 17 Corporate and foreign bonds 476.8 517.6 601.3 689.6 722.2 752.9 775.7 794.0 817.6 849.3 875.1 18 Residential mortgages 1,096.5 1,185.1 1,254.7 1,351.1 1,370.4 1,425.9 1,464.1 1,494.9 1,512.2 1,537.3 1,553.5 19 Other mortgages and loans 1,915.3 2,129.7 2,330.0 2,520.1 2,538.5 2,603.3 2,639.6 2,728.4 2,761.3 2,822.2 2,859.1 20 LESS: Federal Home Loan Bank advances 74.6 88.8 108.6 133.1 129.5 134.8 141.6 152.8 163.8 161.9 151.1 Private financial intermediation 21 Credit market claims held by private financial institutions 4,699.6 5,283.1 6,025.7 6,604.6 6,732.0 6,891.0 7,003.5 7,168.1 7,298.7 7,458.7 7,543.1 22 Commercial banking 1,791.9 1,978.9 2,176.3 2,313.1 2,327.1 2,382.6 2,421.6 2,468.4 2,490.9 2,538.2 2,580.2 23 Savings institutions 1,100.7 1,191.2 1,297.9 1,445.5 1,453.6 1,495.9 1,538.8 1,571.3 1,566.7 1,557.3 1,522.8 24 Insurance and pension funds 1,215.3 1,369.7 1,544.3 1,755.2 1,810.6 1,859.0 1,899.1 1,950.2 1,996.7 2,046.5 2,083.7 25 Other finance 591.7 743.4 1,007.1 1,090.7 1,140.7 1,153.5 1,144.0 1,178.1 1,244.4 1,316.7 1,356.5 26 Sources of funds 4,699.6 5,283.1 6,025.7 6,604.6 6,732.0 6,891.0 7,003.5 7,168.1 7,298.7 7,458.7 7,543.1 27 Private domestic deposits and RPs 2,715.6 2,930.0 3,188.4 3,324.8 3,404.2 3,432.6 3,474.2 3,554.2 3,587.8 3,644.5 3,710.6 28 Credit market debt 479.0 580.5 719.5 859.0 875.4 923.6 941.9 985.7 1,049.7 1,063.1 1,062.9 29 Other sources 1,504.9 1,772.7 2,117.9 2,420.8 2,452.4 2,534.8 2,587.4 2,628.1 2,661.1 2,751.0 2,769.6 30 Foreign funds -14.1 5.6 18.6 62.2 45.9 62.3 51.9 71.6 61.9 51.0 53.7 31 Treasury balances 15.5 25.8 27.5 21.6 23.5 32.6 34.2 29.0 13.5 34.4 32.4 32 Insurance and pension reserves 1,160.8 1,289.4 1,427.9 1,597.2 1,647.9 1,693.8 1,729.2 1,771.2 1,802.6 1,833.7 1,853.9 33 Other, net 342.6 451.8 643.9 739.6 735.2 746.1 772.1 756.4 783.0 831.9 829.6 Private domestic nonfinancial investors 34 Credit market claims 1,238.4 1,499.5 1,610.8 1,813.9 1,816.1 1,891.0 1,984.4 2,070.5 2,136.6 2,172.6 2,239.0 35 U.S. government securities 659.5 814.7 899.1 992.0 1,005.2 1,022.1 1,086.1 1,143.5 1,175.0 1,196.3 1,239.6 36 Tax-exempt obligations 194.2 231.9 211.2 256.8 257.6 270.1 289.0 303.7 307.2 308.2 312.4 37 Corporate and foreign bonds 33.1 38.0 77.8 102.2 97.7 105.7 107.1 100.8 137.0 136.4 150.0 38 Open market paper 83.5 131.0 136.4 160.7 151.9 179.9 188.7 201.0 213.0 221.7 221.4 39 Other 268.0 283.8 286.2 302.3 303.7 313.3 313.6 321.5 304.3 309.9 315.5 40 Deposits and currency 2,895.8 3,120.4 3,399.2 3,553.9 3,628.0 3,662.4 3,704.4 3,785.9 3,822.8 3,887.9 3,945.9 41 Currency 159.6 171.9 186.3 205.4 204.0 209.9 213.4 220.1 220.7 226.4 225.0 42 Checkable deposits 380.6 422.5 517.4 514.0 495.4 510.3 496.1 525.4 492.8 496.4 497.3 43 Small time and savings accounts 1,693.4 1,831.9 1,948.3 2,017.1 2,084.9 2,110.9 2,131.1 2,150.4 2,164.7 2,186.7 2,219.0 44 Money market fund shares 218.5 227.3 265.6 292.8 318.4 306.1 303.6 315.6 340.3 359.9 389.2 45 Large time deposits 332.5 339.9 328.5 355.2 353.7 349.1 384.7 396.0 415.9 423.1 421.2 46 Security RPs 90.6 108.3 128.5 145.7 151.9 156.2 158.6 166.9 174.1 178.4 183.9 47 Deposits in foreign countries 20.6 18.5 24.5 23.7 19.9 19.9 16.8 11.6 14.3 17.0 10.3 48 Total of credit market instruments, deposits, and currency 4,134.2 4,619.9 5,010.0 5,367.8 5,444.2 5,553.5 5,688.8 5,856.4 5,959.4 6,060.4 6,184.9 49 Public holdings as percent of total 20.3 20.8 22.8 23.8 24.1 24.1 24.0 24.2 24.5 24.2 24.5 50 Private financial intermediation (in percent) 86.1 85.2 87.1 87.4 87.7 87.7 87.0 86.9 87.0 87.1 86.5 51 Total foreign funds 291.5 373.5 484.7 590.2 615.3 652.5 653.8 701.9 721.2 713.6 748.1 MEMO: Corporate equities not included above 52 Total market value 2,157.9 2,823.9 3,360.6 3,325.0 3,504.0 3,622.7 3,577.6 3,620.3 3,731.6 4,072.3 4,296.0 53 Mutual fund shares 136.7 240.2 413.5 460.1 479.2 486.8 478.1 478.3 486.3 514.8 538.5 54 Other equities 2,021.2 2,583.7 2,947.1 2,864.9 3,024.8 3,136.0 3,099.5 3,142.0 3,245.3 3,557.5 3,757.5 55 Holdings by financial institutions 615.6 800.0 972.1 1,013.8 1,112.6 1,170.0 1,167.1 1,200.4 1,277.7 1,395.7 1,523.6 56 Other holdings 1,542.3 2,023.9 2,388.4 2,311.2 2,391.3 2,452.8 2,410.5 2,419.9 2,453.9 2,676.6 2,772.4 NOTES BY LINE NUMBER. 32. Excludes net investment of these reserves in corporate equities. 1. Line 1 of table 1.59. 33. Mainly retained earnings and net miscellaneous liabilities. 2. Sum of lines 3-6 or 7-10. 34. Line 14 less line 21 plus line 28. 6. Includes farm and commercial mortgages. 35-39. Lines 15-19 less amounts acquired by private finance plus amounts 12. Credit market debt of federally sponsored agencies, and net issues of borrowed by private finance. Line 39 includes mortgages. federally related mortgage pool securities. 41. Mainly an offset to line 10. 14. Line 1 less line 2 plus line 12 and 13. Also line 21 less line 28 plus line 34. 48. Lines 34 plus 40, or line 14 less line 29 plus 41 and 47. Also sum of lines 29 and 48 less lines 41 and 47. 49. Line 2/line 1 and 13. 19. Includes farm and commercial mortgages. 50. Line 21/line 14. 27. Line 40 less lines 41 and 47. 51. Sum of lines 11 and 30. 28. Excludes equity issues and investment company shares. Includes line 20. 52-54. Includes issues by financial institutions. 30. Foreign deposits at commercial banks plus bank borrowings from foreign NOTE. Full statements for sectors and transaction types in flows and in amounts affiliates, less claims on foreign affiliates and deposits by banking in foreign banks. outstanding may be obtained from Flow of Funds Section, Stop 95, Division of 31. Demand deposits and note balances at commercial banks. Research and Statistics, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • February 1990 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures1 1977 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted. 1989 MMeeaassuurree 11998866 11998877 11998888 Mar. Apr. May June July Aug/ Sept/ Oct/ Nov. 1 Industrial production 125.1 129.8 137.2 140.7 141.7 141.6 142.0 141.9 142.5 142.1 141.3 141.5 Market groupings 2 Products, total 133.3 138.3 145.9 150.5 151.6 151.7 152.5 151.8 152.5 152.1 150.9 151.5 3 Final, total 132.5 136.8 144.3 148.9 150.2 150.4 151.2 150.2 151.1 150.5 148.8 149.4 4 Consumer goods 124.0 127.7 133.9 138.4 139.5 139.2 139.9 138.7 139.3 138.9 139.5 139.2 5 Equipment 143.6 148.8 158.2 162.8 164.3 165.4 166.1 165.5 166.8 165.9 161.1 163.1 6 Intermediate 136.2 143.3 151.5 156.1 156.5 156.3 157.0 157.5 157.5 157.7 158.4 158.5 7 Materials 113.8 118.3 125.3 127.3 128.2 127.9 127.7 128.3 128.8 128.5 128.2 128.0 Industry groupings 8 Manufacturing 129.1 134.6 142.8 147.0 148.0 148.1 148.7 148.5 149.2 148.7 147.5 147.8 Capacity utilization (percent)2 9 Manufacturing 79.7 81.1 83.5 84.1 84.5 84.3 84.4 84.0 84.2 83.7 82.8 82.7 10 Industrial materials industries 78.6 80.5 83.7 83.7 84.2 83.8 83.6 83.7 83.9 83.5 83.2 82.9 11 Construction contracts (1982 = 100)3 158.3 163.8 160.8 150.0 163.0 159.0 157.0 163.0 160.0 175.0 165.0 160.0 12 Nonagricultural employment, total4 120.7 124.1 128.6 130.8 131.1 131.3 131.7 131.9 132.0 132.3 132.4 132.7 13 Goods-producing, total 100.9 101.8 105.0 105.4 105.5 105.5 105.4 105.4 105.5 105.2 105.2 105.2 14 Manufacturing, total 96.4r 99.3' 100.0 99.9 99.9 99.8 99.8 99.8 99.4 99.3 99.1 15 Manufacturing, production- worker ... 91.3r 92. V 94.5r 95.1 95.0 95.0 94.8 94.8 94.8 94.2 94.1 94.0 16 Service-producing 129.0 133.4 138.5 141.5 141.8 142.2 142.7 143.0 143.1 143.6 143.8 144.2 17 Personal income, total 219.4 235.0 252.8' 271.3 272.9 273.5 274.8 276.4r 277.3 277.9 280.1 282.5 18 Wages and salary disbursements 210.8 226.3 244.4 259.5 261.7 262.0 263.8 266.1 266.7 268.5 271.4 271.6 19 Manufacturing 177.4 183.8 196.5 207.5 205.7 205.8 207.0 207.5 208.8 208.8 211.1 209.3 20 Disposable personal income 218.5 232.4 252.1 270.3 269.6 271.7 273.8 275.4 276.1 276.5 278.6 281.1 21 Retail sales6 199.3 210.8 225.1 232.4 235.5 237.4 237.3 239.1 241.3 242.0 238.8 240.8 Prices7 22 Consumer (1982-84 = 100) 109.6 113.6 118.3 122.3 123.1 123.8 124.1 124.4 124.6 125.0 125.6 125.9 23 Producer finished goods (1982 = 100) ... 103.2 105.4 108.0 112.1 113.0 114.2 114.3 114.lr 113.3 113.5 114.8 114.8 1. A major revision of the industrial production index and the capacity 5. Based on data in Survey of Current Business (U.S. Department of Comutilization rates was released in July 1985. See "A Revision of the Index of merce). Industrial Production" and accompanying tables that contain revised indexes 6. Based on Bureau of Census data published in Survey of Current Business. (1977=100) through December 1984 in the Federal Reserve Bulletin, vol. 71 (July 7. Data without seasonal adjustment, as published in Monthly Labor Review. 1985), pp. 487-501. The revised indexes for January through June 1985 were Seasonally adjusted data for changes in the price indexes may be obtained from shown in the September Bulletin. the Bureau of Labor Statistics, U.S. Department of Labor. 2. Ratios of indexes of production to indexes of capacity. Based on data from Federal Reserve, McGraw-Hill Economics Department, Department of Com- NOTE. Basic data (not index numbers) for series mentioned in notes 4, 5,and 6, merce, and other sources. and indexes for series mentioned in notes 3 and 7 may also be found in the Survey 3. Index of dollar value of total construction contracts, including residential, of Current Business. nonresidential and heavy engineering, from McGraw-Hill Information Systems Figures for industrial production for the last two months are preliminary and Company, F. W. Dodge Division. estimated, respectively. 4. Based on data in Employment and Earnings (U.S. Department of Labor). Series covers employees only, excluding personnel in the Armed Forces. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A47 2.11 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data are seasonally adjusted. Exceptions noted. 1989 CCaatteeggoorryy 11998866 11998877 11998888 Apr. May June July Aug. Sept. Oct. Nov. HOUSEHOLD SURVEY DATA 1 Noninstitutional population1 182,822 185,010 186,837 188,228 188,377 188,518 188,672 188,808 188,948 189,0% 189,238 2 Labor force (including Armed Forces)1 120,078 122,122 123,893 125,863 125,806 126,291 126,145 126,228 126,262 126,330 126,736 3 Civilian labor force 117,834 119,865 121,669 123,659 123,610 124,102 123,956 124,018 124,040 124,105 124,515 Employment 4 Nonagricultural industries2 106,434 109,232 111,800 114,009 114,102 114,445 114,240 114,290 114,199 114,327 114,644 5 Agriculture 3,163 3,208 3,169 3,104 3,112 3,096 3,219 3,307 3,257 3,217 3,141 Unemployment 6 Number 8,237 7,425 6,701 6,546 6,395 6,561 6,497 6,421 6,584 6,561 6,729 7 Rate (percent of civilian labor force) 7.0 6.2 5.5 5.3 5.2 5.3 5.2 5.2 5.3 5.3 5.4 8 Not in labor force 62,744 62,888 62,944 62,365 62,571 62,227 62,527 62,580 62,686 62,766 62,502 ESTABLISHMENT SURVEY DATA 9 Nonagricultural payroll employment3 99,525 102,310 106,039 108,101 108,310 108,607 108,767 108,887 109,0%' 109,189' 109,399 10 Manufacturing 18,965 19,065 19,536 19,672 19,667 19,650 19,649 19,644 19,559' 19,543 19,516 11 Mining 777 721 733 720 722 715 706 729 730 731' 738 12 Contract construction 4,816 4,998 5,294 5,279 5,283 5,283 5,314 5,321 5,325' 5,333' 5,350 13 Transportation and public utilities 5,255 5,385 5,584 5,682 5,700 5,716 5,736 5,618 5,709' 5,733' 5,744 14 Trade 23,683 24,381 25,362 25,695 25,750 25,781 25,823 25,877 25,896' 25,952' 26,003 15 Finance 6,283 6,549 6,679 6,776 6,790 6,808 6,815 6,836 6,852' 6,849' 6,864 16 Service 23,053 24,196 25,464 26,651 26,711 26,931 26,973 27,058 27,159' 27,195' 27,320 17 Government 16,693 17,015 17,387 17,626 17,687 17,723 17,751 17,804 17,866' 17,853' 17,864 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 1984 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

A48 Domestic Nonfinancial Statistics • February 1990 2.12 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION1 Seasonally adjusted 1988 1989 1988 1989 1988 1989 oenes Q4 Ql Q2 Q3' Q4 Ql Q2 Q3 Q4 Ql Q2 Q3r Output (1977 = 100) Capacity (percent of 1977 output) Utilization rate (perce it) 1 Total industry 139.9 140.7 141.8 142.2 166.3 167.5 168.7 169.9 84.1 84.0 84.1 83.7 2 104.2 101.8 102.0 102.6 125.7 125.1 124.7 124.3 82.9 81.3 81.8 82.5 i Utilities 114.3 116.0 115.7 113.9 140.7 141.0 141.4 141.7 81.3 82.3 81.8 80.4 4 Manufacturing 145.8 147.0 148.3 148.8 172.8 174.3 175.7 177.2 84.4 84.4 84.4 84.0 5 Primary processing 127.7 127.8 127.6 128.9 145.2 146.5 147.8 149.1 87.9 87.3 86.4 86.4 6 Advanced processing 156.7 158.6 160.8 161.1 189.5 191.0 192.6 194.2 82.7 83.0 83.5 83.0 7 Materials 128.0 127.6 127.9 128.5 150.8 151.7 152.6 153.5 84.9 84.1 83.9 83.7 8 Durable goods 139.2 138.6 139.0 140.4 169.0 170.1 171.3 172.5 82.4 81.5 81.1 81.4 9 Metal materials 92.3 90.9 88.2 89.6 102.6 103.1 103.7 104.3 70.0 88.2 85.1 85.8 10 Nondurable goods 135.4 136.3 137.1 137.9 151.2 152.7 154.2 155.8 89.5 89.3 88.9 88.5 11 Textile, paper, and chemical 138.1 139.2 139.8 141.1 151.8 153.5 155.3 157.0 91.0 90.7 90.0 89.9 12 Paper 148.6 148.4 146.1 149.9 152.3 154.0 155.8 157.6 97.6 96.4 93.8 95.1 13 Chemical 144.1 145.4 145.7 146.5 159.3 161.4 163.7 165.9 90.5 90.1 89.0 88.3 14 Energy materials 102.0 100.7 100.7 99.7 118.7 118.4 118.3 118.1 86.0 85.0 85.1 84.4 Previous cycle2 Latest cycle3 1988 1989 High Low High Low Nov. Mar. Apr. May June July Aug/ Sept/ Oct/ Nov. Capacity utilization rate (percent) IS Total industry 88.6 72.1 86.9 69.5 84.1 83.8 84.2 84.0 84.0 83.7 83.9 83.4 82.8 82.7 1 1 6 7 U M t i i n li i t n ie g s .. . 9 9 2 5 . . 8 6 8 8 2 7 . . 9 8 9 88 5 . . 5 2 7 7 8 6 . . 0 9 8 8 0 3 . . 8 3 8 8 1 3 . . 2 3 8 8 2 2 . . 0 9 8 8 1 1 . . 8 8 8 8 1 0 . . 5 8 8 8 0 2 . . 5 1 8 8 2 0 . . 4 0 8 8 0 3 . . 6 1 8 81 3 . . 1 5 8 80 3 . . 9 8 18 Manufacturing 87.7 69.9 86.5 68.0 84.4 84.1 84.5 84.3 84.4 84.0 84.2 83.7 82.8 82.7 2 1 0 9 A Pr d im va a n r c y e d p r p o r c o e c s e s s i s n i g n . g . . . 8 9 6 1 . . 0 9 6 7 8 1 . . 3 1 8 8 5 9 . . 1 1 6 6 9 5 . . 5 0 8 88 2 . . 1 6 8 86 3 . . 4 0 8 83 6 . . 5 8 8 83 6 . . 4 2 8 83 6 . . 5 2 8 82 6 . . 9 7 8 83 6 . . 2 6 8 82 6 . . 8 0 8 81 5 . . 4 8 8 81 5 . . 4 5 21 Materials 92.0 70.5 89.1 68.5 85.1 83.7 84.2 83.8 83.6 83.7 83.9 83.5 83.2 82.9 2 2 2 2 2 3 4 5 D N u o T M r n e a d e x b u t t l a r e i l l a e b g m , l o e p a o t a d g e p s r o e i o a r d l , s s a n . d . . 9 9 9 1 9 1 . . . 8 2 1 6 6 6 4 7 6 . . . 4 1 7 9 8 8 3 8 9 . . . 1 6 8 6 7 4 0 5 0 . . . 9 7 7 9 8 8 0 2 9 . . . 4 7 4 8 8 80 8 5 . . . 9 8 6 8 8 8 1 7 9 . . . 3 1 2 8 8 8 4 1 8 . . . 1 0 7 8 8 81 8 4 . . . 1 7 0 8 8 8 9 1 5 . . . 2 3 6 8 8 8 1 6 8 . . . 7 5 8 8 8 8 1 7 5 . . . 2 5 3 8 8 8 0 4 8 . . . 1 5 3 7 8 8 9 2 7 . . . 7 1 9 2 2 6 7 C Pa h c p e h e m e r m ic i a c l a l 9 9 9 8 2 2 . . . 4 8 5 7 6 6 0 4 4 . . . 6 8 4 9 8 8 7 9 7 . . . 3 4 9 7 6 6 9 8 3 . . . 9 8 5 9 9 9 6 0 0 . . . 7 9 5 9 9 8 5 0 9 . . . 3 2 7 9 9 9 4 0 0 . . . 5 7 1 9 8 8 3 9 8 . . . 2 6 4 9 8 8 3 9 8 . . . 7 8 5 9 9 8 5 0 9 . . . 0 6 5 9 9 8 5 0 8 . . . 1 1 6 9 8 8 5 8 6 . . . 2 8 7 9 8 8 5 9 7 . . . 4 6 9 89.0 28 Energy materials. 94.6 86.9 94.0 82.3 86.2 85.4 86.0 85.5 83.8 83.9 84.3 85.1 85.5 85.3 1. These data also appear in the Board's G.3 (402) release. For address, see 2. Monthly high 1973; monthly low 1975. inside front cover. 3. Monthly highs 1978 through 1980; monthly lows 1982. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A49 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value1 Monthly data are seasonally adjusted 1977 1988 1989 1988 GGrroouuppss por- avg. tion Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug/ Sept/ Oct." Nov/ Index (1977 = 100) MAJOR MARKET 1 Total index 100.00 137.2 139.9 140.4 140.8 140.5 140.7 141.7 141.6 142.0 141.9 142.5 142.1 141.3 141.5 2 Products 57.72 145.9 148.4 149.4 150.1 150.0 150.5 151.6 151.7 152.5 151.8 152.5 152.1 150.9 151.5 3 Final products 44.77 144.3 146.8 147.7 148.2 148.6 148.9 150.2 150.4 151.2 150.2 151.1 150.5 148.8 149.4 4 Consumer goods 25.52 133.9 136.8 138.2 138.5 138.7 138.4 139.5 139.2 139.9 138.7 139.3 138.9 139.5 139.2 5 Equipment 19.25 158.2 159.9 160.4 161.1 161.6 162.8 164.3 165.4 166.1 165.5 166.8 165.9 161.1 163.1 6 Intermediate products 12.94 151.5 154.2 155.0 156.6 155.1 156.1 156.5 156.3 157.0 157.5 157.5 157.7 158.4 158.5 7 Materials 42.28 125.3 128.3 128.3 128.1 127.4 127.3 128.2 127.9 127.7 128.3 128.8 128.5 128.2 128.0 Consumer goods 8 Durable consumer goods 6.89 125.4 129.2 131.9 131.5 131.6 130.1 132.2 131.2 130.8 127.3 128.7 127.7 126.4 125.7 9 Automotive products 2.98 125.1 129.5 134.5 132.5 131.6 128.9 131.7 128.6 125.6 120.2 122.3 120.5 118.3 118.3 10 Autos and trucks 1.79 123.0 129.5 138.0 135.6 133.1 128.3 131.7 127.4 123.3 114.6 119.3 117.1 113.2 113.4 11 Autos, consumer 1.16 93.7 101.0 105.1 99.6 96.0 95.0 98.8 96.0 91.4 81.2 86.4 92.7 91.6 84.3 12 Trucks, consumer .63 177.4 182.4 199.1 202.3 201.9 190.0 192.8 185.5 182.5 176.7 180.5 162.4 153.3 167.3 13 Auto parts and allied goods 1.19 128.3 129.5 129.3 127.9 129.4 129.8 131.7 130.4 129.1 128.7 126.7 125.7 126.0 125.8 14 Home goods 3.91 125.6 128.9 130.0 130.7 131.6 131.1 132.6 133.3 134.8 132.7 133.5 133.1 132.5 131.4 15 Appliances, A/C and TV 1.24 144.1 150.4 151.0 151.0 153.9 151.6 151.7 151.3 155.6 148.1 152.1 151.8 151.0 147.0 16 Appliances and TV 1.19 143.5 148.9 150.0 149.5 153.0 152.3 152.5 151.4 155.0 147.0 149.4 148.3 146.6 17 Carpeting and furniture .96 136.2 139.8 140.5 141.1 141.3 140.7 142.8 144.3 143.1 141.3 139.8 140.0 140.8 18 Miscellaneous home goods 1.71 106.3 107.3 108.9 110.1 110.1 110.9 113.0 114.1 115.0 116.8 116.6 115.8 114.5 19 Nondurable consumer goods 18.63 137.0 139.7 140.5 141.1 141.4 141.4 142.2 142.1 143.3 142.8 143.2 143.1 144.3 144.2 20 Consumer staples 15.29 144.8 147.9 148.9 149.4 149.7 149.9 150.7 150.7 151.9 151.4 152.0 151.8 153.4 153.3 21 Consumer foods and tobacco 7.80 141.0 143.7 144.5 144.8 144.3 143.3 144.7 144.7 145.7 144.2 145.6 146.0 147.2 22 Nonfood staples 7.49 148.9 152.2 153.6 154.2 155.4 156.9 156.9 156.9 158.4 158.9 158.7 157.9 159.8 160.2 23 Consumer chemical products 2.75 179.8 185.7 186.8 187.6 187.8 188.9 187.3 189.1 191.0 193.1 192.5 188.8 192.0 24 Consumer paper products 1.88 163.3 167.8 169.0 174.2 177.0 180.4 180.9 180.9 183.6 183.0 184.7 185.4 186.5 25 Consumer energy 2.86 109.8 109.8 111.6 109.1 110.1 110.7 112.0 110.1 110.7 110.4 109.2 110.3 111.4 110.3 26 Consumer fuel 1.44 95.4 94.1 96.3 96.7 95.0 95.6 97.3 93.6 95.6 97.0 96.0 95.7 96.9 27 Residential utilities 1.42 124.5 125.8 127.1 121.7 125.4 126.1 127.0 127.0 126.1 124.0 122.7 125.1 Equipment 28 Business and defense equipment 18.01 163.3 165.5 166.2 167.1 167.9 168.9 170.3 171.5 172.0 171.3 172.5 171.5 166.5 168.5 29 Business equipment 14.34 157.6 161.2 162.6 163.8 165.0 166.3 167.8 169.1 169.6 168.5 169.9 168.7 164.1 166.2 30 Construction, mining, and farm 2.08 71.9 74.5 74.6 74.3 75.6 76.9 77.6 76.3 74.8 73.0 72.1 74.5 74.5 75.2 31 Manufacturing 3.27 131.3 136.2 137.0 136.3 137.8 138.6 139.7 140.9 142.8 143.8 143.5 141.9 141.6 142.3 32 Power 1.27 89.4 92.1 91.8 92.8 92.7 93.0 93.6 93.3 92.5 92.8 94.2 93.6 95.1 95.7 33 Commercial . 5.22 245.0 247.0 248.9 252.4 254.3 257.6 260.1 263.2 264.5 263.8 265.6 263.7 257.9 262.0 34 Transit 2.49 115.4 122.3 124.9 125.7 125.2 123.9 124.8 125.3 124.8 120.1 124.4 122.2 107.5 109.3 35 Defense and space equipment 3.67 185.9 182.2 180.5 180.0 179.3 178.7 179.9 180.7 181.1 182.0 182.7 182.1 175.7 177.1 Intermediate products 36 Construction supplies 5.95 138.6 140.7 141.4 142.3 139.5 139.3 140.2 140.2 141.2 142.2 141.5 140.7 141.4 142.0 37 Business supplies 6.99 162.4 165.7 166.7 168.8 168.4 170.4 170.4 170.0 170.4 170.6 171.2 172.2 172.9 38 General business supplies 5.67 168.5 172.9 173.8 175.9 175.4 177.4 177.9 177.3 177.9 177.8 178.8 180.0 180.4 39 Commercial energy products 1.31 136.3 134.3 135.8 138.2 138.3 140.3 138.0 138.2 138.4 139.6 138.1 138.5 140.4 Materials 40 Durable goods materials 20.50 135.5 139.8 139.0 139.4 138.6 137.9 139.0 138.7 139.4 139.9 140.9 140.4 138.8 138.5 41 Durable consumer parts 4.92 109.0 113.9 112.5 111.7 112.1 110.7 110.8 111.8 111.6 109.9 111.9 110.8 108.0 106.9 42 Equipment parts 5.94 171.6 175.0 174.1 175.2 175.2 175.3 176.9 177.1 177.5 179.1 180.0 179.8 177.0 178.5 43 Durable materials n.e.c 9.64 126.8 131.3 130.9 131.5 129.7 128.8 130.0 128.9 130.0 131.0 131.6 131.2 130.9 130.0 44 Basic metal materials 4.64 96.1 101.4 99.8 100.8 98.4 95.9 98.0 94.4 95.5 97.7 98.4 97.4 96.4 94.0 45 Nondurable goods materials 10.09 132.0 135.1 136.3 137.1 135.9 136.0 137.1 136.8 137.3 138.5 138.3 136.7 138.5 138.3 46 Textile, paper, and chemical materials 7.53 134.4 137.9 139.1 139.9 138.6 139.0 140.3 139.1 140.0 141.8 141.5 140.0 141.7 141.3 47 Textile materials 1.52 110.0 110.1 110.0 112.1 110.7 111.8 114.6 116.4 117.2 116.4 117.0 115.6 115.6 48 Pulp and paper materials 1.55 147.3 147.2 150.3 150.4 147.5 147.3 146.7 145.2 146.5 149.1 149.9 150.6 151.5 49 Chemical materials 4.46 138.2 144.2 145.1 145.7 145.0 145.4 146.8 144.7 145.5 147.9 147.0 144.6 147.2 50 Miscellaneous nondurable materials ... 2.57 125.0 127.0 128.0 129.1 128.0 127.2 127.8 129.9 129.4 129.0 128.9 127.2 51 Energy materials 11.69 101.5 102.3 102.6 100.5 100.5 101.0 101.7 101.1 99.1 99.1 99.5 100.5 100.9 100.7 52 Primary energy 7.57 106.3 108.6 107.6 105.2 104.4 103.7 104.1 104.6 103.0 103.2 104.2 104.9 105.4 53 Converted fuel materials 4.12 92.7 90.7 93.3 92.0 93.3 96.1 97.4 94.7 92.0 91.6 91.0 92.3 92.6 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A50 Domestic Nonfinancial Statistics • February 1990 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value1—Continued 1977 1989 Groups c S o I d C e pr t o io p n o r- a 1 v 98 g 8 . Feb. Mar. Apr. May June July Aug/ Sept/ Oct.p Nov. Index (1977 = 100) MAJOR INDUSTRY 1 Mining and utilities . 15.79 107.5 108.1 108.9 107.2 106.8 107.5 107.9 107.2 106.3 106.6 106.5 107.4 107.9 107.9 2 Mining 9.83 103.5 104.7 104.9 103.0 100.9 101.5 102.4 102.0 101.5 102.1 102.4 103.1 103.6 103.7 3 Utilities 5.% 114.0 113.7 115.4 114.0 116.5 117.5 117.1 115.6 114.3 114.0 113.3 114.3 115.1 114.8 4 Manufacturing 84.21 142.8 145.8 146.3 147.2 146.8 147.0 148.0 148.1 148.7 148.5 149.2 148.7 147.5 147.8 5 Nondurable 35.11 143.9 146.7 147.1 148.5 148.1 148.6 149.6 149.5 150.5 150.8 151.1 151.2 152.0 151.7 6 Durable 49.10 142.0 145.2 145.7 146.2 145.9 145.8 146.9 147.1 147.4 146.8 147.8 146.9 144.3 145.1 Mining 7 Metal 10 .50 93.6 104.6 111.9 106.9 98.6 98.1 96.8 94.0 101.2 106.2 103.7 104.2 8 Coal 11.12 1.60 138.2 149.7 155.1 144.7 134.7 137.7 145.5 137.1 129.2 130.2 135.4 144.2 144.4 9 Oil and gas extraction 13 7.07 93.0 90.8 88.9 88.9 89.5 89.6 89.1 90.5 90.6 90.8 90.3 89.9 90.0 10 Stone and earth minerals. 14 .66 140.0 144.0 149.4 150.8 142.5 143.5 144.5 146.6 150.2 152.1 151.5 144.8 150.0 Nondurable manufactures 11 Foods 7.96 142.7 145.7 145.8 146.6 146.3 145.4 146.6 147.2 147.9 147.3 148.3 148.8 12 Tobacco products .62 105.4 102.4 107.0 105.0 104.7 101.5 109.2 105.9 104.2 97.1 99.9 13 Textile mill products 2.29 116.4 117.2 117.9 120.2 119.4 119.7 122.5 123.6 123.8 123.5 123.2 123!2 122.3 14 Apparel products 2.79 109.1 110.1 108.8 110.2 110.2 109.9 111.3 111.5 111.9 111.4 111.1 111.0 110.0 15 Paper and products 3.15 150.2 150.7 151.7 153.8 151.7 151.7 150.7 150.1 150.2 152.4 152.8 153.4 154.0 16 Printing and publishing 4.54 183.8 188.5 188.0 193.0 194.6 198.5 200.1 199.0 200.5 199.9 200.6 202.7 202.8 17 Chemicals and products 8.05 152.0 157.5 158.1 159.0 158.5 159.2 159.3 158.2 159.9 162.2 161.5 159.6 161.8 18 Petroleum products 2.40 96.0 95.0 98.0 98.0 96.3 97.0 97.3 96.9 97.9 98.3 97.7 98.3 99.8 19 Rubber and plastic products , 2.80 174.4 177.5 177.5 175.9 175.0 176.4 178.0 180.5 182.3 182.3 183.6 183.8 184.1 20 Leather and products .53 59.4 61.5 60.2 62.9 62.9 61.2 61.4 60.3 60.5 60.8 60.2 60.2 59.9 Durable manufactures 21 Lumber and products 24 2.30 137.6 139.4 143.0 139.9 132.8 133.4 135.1 135.5 137.2 136.9 136.5 135.3 136.2 22 Furniture and fixtures 25 1.27 162.0 165.4 165.4 166.3 164.8 165.8 168.0 170.2 170.8 169.0 168.0 168.4 168.7 23 Clay, glass, and stone products .. 32 2.72 122.6 124.7 125.1 126.6 125.4 125.5 124.7 123.9 123.9 122.9 123.9 122.6 123.5 24 Primary metals 33 5.33 89.4 90.0 93.2 91.1 88.4 90.1 87.2 87.3 89.2 90.3 89.2 88.5 86.2 25 Iron and steel 331.2 3.49 78.2 77.6 82.2 79.1 75.9 77.0 73.2 72.9 75.4 75.9 75.4 75.7 26 Fabricated metal products. 34 6.46 120.9 124.6 125.1 124.5 124.5 123.8 123.1 124.8 125.2 125.4 125.5 124.7 123.9 124! i 27 Nonelectrical machinery .. 35 9.54 170.7 175.4 177.8 178.7 180.8 183.0 184.7 186.5 187.5 186.7 187.8 186.8 183.2 187.3 28 Electrical machinery 36 7.15 180.1 182.2 180.9 180.9 181.7 181.6 182.2 181.6 181.9 181.4 183.7 182.8 181.5 181.0 29 Transportation equipment 37 9.13 132.2 135.2 136.8 136.7 136.4 134.8 136.4 135.5 134.2 131.3 133.2 131.8 123.3 124.3 30 Motor vehicles and parts 371 5.25 117.4 122.9 125.5 124.9 123.4 120.4 122.0 119.7 116.4 110.4 114.2 112.7 110.1 109.6 31 Aerospace and miscellaneous transportation equipment.. 572-6.9 3.87 152.4 151.9 152.2 152.7 154.0 154.4 155.9 157.1 158.4 159.6 159.0 157.8 141.3 144.3 32 Instruments 38 2.66 154.4 160.4 159.1 161.0 161.3 161.8 163.0 164.3 165.7 166.0 164.1 162.9 163.0 162.9 33 Miscellaneous manufactures 39 1.46 107.1 108.4 111.0 111.8 107.6 110.0 114.5 114.7 117.1 119.6 118.5 117.8 116.4 Utilities 34 Electric . 132.9 135.3 134.9 134.2 135.3 136.3 136.0 Gross value (billions of 1982 dollars, annual rates) MAJOR MARKET 35 Products, total 517.5 145.9 148.4 149.4 150.1 150.0 150.5 151.6 151.7 152.5 151.8 152.5 152.1 150.9 151.5 36 Final 405.7 144.3 146.8 147.7 148.2 148.6 148.9 150.2 150.4 151.2 150.2 151.1 150.5 148.8 149.4 37 Consumer goods 272.7 133.9 136.8 138.2 138.5 138.7 138.4 139.5 139.2 139.9 138.7 139.3 138.9 139.5 139.2 38 Equipment 133.0 158.2 159.9 160.4 161.1 161.6 162.8 164.3 165.4 166.1 165.5 166.8 165.9 161.1 163.1 39 Intermediate 111.9 151.5 154.2 155.0 156.6 155.1 156.1 156.5 156.3 157.0 157.5 157.5 157.7 158.4 158.5 1. These data also appear in the Board's G.12.3 (414) release. For address, see Industrial Production" and accompanying tables that contain revised indexes inside front cover. (1977= 100) through December 1984 in the Federal Reserve Bulletin, vol. 71 (July A major revision of the industrial production index and the capacity 1985), pp. 487-501. The revised indexes for January through June 1985 were utilization rates was released in July 1985. See "A Revision of the Index of shown in the September Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A51 2.14 HOUSING AND CONSTRUCTION Monthly figures are at seasonally adjusted annual rates except as noted. 1989 IItteemm 11998866 11998877 11998888 Jan. Feb. Mar. Apr. May June July Aug.' Sept.' Oct. Private residential real estate activity (thousands of units) NEW UNITS 1 Permits authorized 1,750 1,535 1,456 1,486 1,403 1,230 1,334 1,347 1,308 1,281 1,328 1,319 1,356 2 1-family 1,071 1,024 994 1,052 989 870 954 905 874 906 927 946 961 3 2-or-more-family 679 511 462 434 414 360 380 442 434 375 401 373 395 4 Started 1,805 1,621 1,488 1,678 1,465 1,409 1,343 1,308 1,406 1,420 1,329 1,264 1,428 5 1-family 1,180 1,146 1,081 1,199 1,029 981 1,029 977 972 1,026 990 971 1,024 6 2-or-more-family 626 474 407 479 436 428 314 331 434 394 339 293 404 7 Under construction, end of period1 . 1,074 987 919 957 951 942 924 911 914 918 902 895 899 8 1-family 583 591 570 602 594 586 579 572 572 576 565 568 569 9 2-or-more-family 490 397 350 355 357 356 345 339 342 342 337 327 330 10 Completed 1,756 1,669 1,530 1,537 1,610 1,459 1,552 1,442 1,355 1,372 1,439 1,360 1,312 11 1-family 1,120 1,123 1,085 1,141 1,189 1,050 1,115 1,041 964 965 1,040 952 978 12 2-or-more-family 636 546 445 396 421 409 437 401 391 407 399 408 334 13 Mobile homes shipped 244 233 218 232 212 207 198 205 202 178 194 185 191 Merchant builder activity in 1-family units 14 Number sold 748 672 675 700 621 555 607 653 647 738' 726 652 649 15 Number for sale, end of period .... 357 365 366 369 375 377 377 380 377 369' 365 366 364 Price (thousands of dollars)2 Median 16 Units sold 92.2 104.7 113.3 113.0 118.0 123.0 116.7 119.0 122.8 116.0' 122.7 121.5 127.9 17 Units sold 112.2 127.9 139.0 138.6 145.3 149.0 144.7 145.1 153.6 140.3' 159.0 151.9 151.9 EXISTING UNITS (1-family) 18 Number sold 3,566 3,530 3,594 3,550 3,480 3,400 3,400 3,210 3,360 3,330 3,480 3,520 3,480 Price of units sold (thousands of dollars)2 19 Median 80.3 85.6 89.2 89.7 91.9 92.0 92.9 92.6 93.4 96.7 94.8 94.3 92.6 20 Average 98.3 106.2 112.5 113.0 117.8 116.1 118.0 118.0 118.8 122.1 120.8 118.4 117.2 Value of new construction3 (millions of dollars) CONSTRUCTION 21 Total put in place 387,043 397,721 409,663 422,979r 416,597r 416,779r 411,891' 416,540' 412,523' 409,601 415,773 415,917 420,060 22 Private 315,313 320,108 328,738 337,669' 333,169r 338,065' 332,537' 330,591' 329,035' 328,046 331,528 329,418 332,043 23 Residential 187,147 194,656 198,101 202,895r 200,454'' 202,083' 200,735' 196,984' 194,229' 194,257 193,565 191,776 193,639 24 Nonresidential, total 128,166 125,452 130,637 134,774 132,715 135,982 131,802 133,607' 134,806' 133,789 137,963 137,642 138,404 Buildings 25 Industrial 13,747 13,707 14,931 15,890 15,098 15,698 16,245 15,945 16,302 16,390 17,560 18,010 18,314 26 Commercial 56,762 55,448 58,104 59,350 58,749 60,653 55,581 56,796 57,434 56,499 57,706 57,265 58,040 27 Other 13,216 15,464 17,278 17,976 17,484 17,634 16,645 17,343 17,179 16,792 18,443 17,945 18,072 28 Public utilities and other 44,441 40,833 40,324 41,558 41,384 41,997 43,331 43,523' 43,891' 44,108 44,254 44,422 43,978 79 Public 71,727 77,612 80,922 85,310 83,428 78,714 80,420 85,130 81,914 81,555 84,246 86,499 88,017 30 Military 3,868 4,327 3,579 3,440 3,433 3,740 2,054 3,870 4,324 3,264 3,689 4,226 3,251 31 Highway 22,971 25,343 28,524 30,792 27,936 26,091 27,772 27,432 27,321 26,128 27,167 27,445 26,863 37 Conservation and development... 4,646 5,162 4,474 4,121 4,742 4,210 3,068 6,053 4,699 4,535 4,653 4,976 5,791 33 Other 40,242 42,780 44,345 46,957 47,317 44,673 47,526 47,775 45,570 47,628 48,737 49,852 52,112 1. Not at annual rates. NOTE. Census Bureau estimates for all series except (1) 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 (2) sales and prices comparable with data in previous periods because of changes by the Bureau of the of 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 the originating agency. Permit Construction Reports (C-30-76-5), issued by the Bureau in July 1976. authorizations 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

A52 Domestic Nonfinancial Statistics • February 1990 2.15 CONSUMER AND PRODUCER PRICES Percentage changes based on seasonally adjusted data, except as noted Change from 12 Change from 3 months earlier months earlier (at annual rate) Change from 1 month earlier IIInnndddeeexxx IIIttteeemmm llleeevvveeelll 1988 1989 1989 NNNooovvv... 11998888 11998899 111999888999111 NNoovv.. NNoovv.. Dec. Mar. June Sept. July Aug. Sept. Oct. Nov. CONSUMER PRICES2 (1982-84=100) 1 AH items 4.2 4.7 4.1 6.1 5.7 1.6 .2 .0 .2 .5 .4 125.9 2 Food 5.3 5.6 3.0 8.2 5.6 2.9 .3 .2 .2 .4 .6 126.9 3 Energy items -.1 4.8 -.4 10.2 24.8 -13.4 -.7 -2.0 -.9 .6 -.1 93.2 4 All items less food and energy 4.4 4.4 4.9 5.2 3.8 3.1 .4 .2 .2 .5 .4 131.3 5 Commodities 3.6 2.9 4.2 4.1 2.0 .7 .1 -.3 .4 .6 .2 121.6 6 Services 4.9 5.1 5.4 5.9 4.3 4.5 .6 .3 .2 .4 .5 137.0 PRODUCER PRICES (1982=100) 7 Finished goods 3.3 4.6 3.0 10.2 5.8 -.3 -.4 .9 .4 -.1 114.8 8 Consumer foods 4.6 4.6 2.1 13.1 -1.3 -1.3 -.1 .3 -.6 1.4 .8 120.2 9 Consumer energy -4.0 7.5 1.4 41.0 31.8 -16.8 -3.2 -7.3 6.5 .2 -3.3 64.5 10 Other consumer goods 4.3 4.4 4.4 5.4 5.7 2.6 -.y .4' .6 .2 .0 125.9 11 Capital equipment 3.2 3.9 1.7 4.6 4.5 4.8 .v .2' 1.0 -.3 .3 120.6 12 Intermediate materials3 4.9 3.1 4.5 8.7 2.9 -1.1 -.4 -.3 ..44 .1 -.1 112.1 13 Excluding energy 7.2 1.8 6.7 5.5 .3 -.7 -.2 .C ..11 .1 .0 120.1 Crude materials 14 Foods 13.3 1.3 -7.9 16.9 -17.8 -2.2 1.2' -.8 -.6 1.7 109.4 15 Energy -15.8 22.1 12.3 48.3 23.6 -6.5 1.8 -6.7 3.5 .5 .3 76.8 16 Other 6.7 -1.0 12.5 10.3 -9.3 -.6 -1.2' .8' .3 .3 -2.3 134.3 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 A53 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates. 1988 1989 AAccccoouunntt 11998866 11998877 11998888 Q3 Q4 Ql Q2 Q3' GROSS NATIONAL PRODUCT 1 Total 4,231.6 4,524.3 4,880.6 4,926.9 5,017.3 5,113.1 5,201.7 5,281.0 By source 2 Personal consumption expenditures 2,797.4 3,010.8 3,235.1 3,263.4 3,324.0 3,381.4 3,444.1 3,508.1 3 Durable goods 406.0 421.0 455.2 452.5 467.4 466.4 471.0 486.1 4 Nondurable goods 942.0 998.1 1,052.3 1,066.2 1,078.4 1,098.3 1,121.5 1,131.4 5 Services 1,449.5 1,591.7 1,727.6 1,744.7 1,778.2 1,816.7 1,851.7 1,890.6 6 Gross private domestic investment 659.4 699.9 750.3 771.1 752.8 769.6 775.0 779.1 7 Fixed investment 652.5 670.6 719.6 726.5 734.1 742.0 747.6 751.7 8 Nonresidential 435.2 444.3 487.2 493.2 495.8 503.1 512.5 519.6 9 Structures 139.0 133.8 140.3 142.0 142.5 144.7 142.4 146.2 10 Producers' durable equipment 296.2 310.5 346.8 351.3 353.3 358.5 370.1 373.4 11 Residential structures 217.3 226.4 232.4 233.2 238.4 238.8 235.1 232.1 12 Change in business inventories 6.9 29.3 30.6 44.6 18.7 27.7 27.4 27.4 13 Nonfarm 8.6 30.5 34.2 41.5 40.8 19.1 23.6 19.8 14 Net exports of goods and services -97.4 -112.6 -73.7 -66.2 -70.8 -54.0 -50.6 -45.1 15 Exports 396.5 448.6 547.7 556.8 579.7 605.6 626.1 628.5 16 Imports 493.8 561.2 621.3 623.0 650.5 659.6 676.6 673.6 17 Government purchases of goods and services 872.2 926.1 968.9 958.6 1,011.4 1,016.0 1,033.2 1,038.9 18 Federal 366.5 381.6 381.3 367.5 406.4 399.0 406.0 402.7 19 State and local 505.7 544.5 587.6 591.0 604.9 617.0 627.2 636.2 By major type of product 20 Final sales, total 4,224.8 4,495.0 4,850.0 44,,888822..33 4,998.7 5,085.4 5,174.3 55,,225533..66 21 Goods 1,686.7 1,785.2 1,931.9 1,955.8 1,987.4 2,030.9 2,079.1 2,096.3 22 Durable 724.2 777.6 863.6 884.0 888.5 894.7 905.2 930.1 23 Nondurable 962.5 1,007.6 1,068.3 1,071.8 1,098.9 1,136.2 1,173.9 1,166.2 24 Services 2,119.3 2,304.5 2,499.2 2,520.3 2,570.0 2,620.8 2,667.5 2,728.1 25 Structures 425.6 434.6 449.5 450.8 459.9 461.3 455.1 456.6 26 Change in business inventories 6.9 29.3 30.6 44.6 18.7 27.7 27.4 27.4 27 Durable goods 1.2 22.0 25.0 41.4 32.0 22.0 6.0 5.2 28 Nondurable goods 5.6 7.2 5.6 3.2 -13.3 5.7 21.4 22.2 MEMO 29 Total GNP in 1982 dollars 3,717.9 3,853.7 4,024.4 4,042.7 4,069.4 4,106.8 4,132.5 4,162.9 NATIONAL INCOME 30 Total 3,412.6 3,665.4 3,972.6 4,005.7 4,097.4 4,185.2 4,249.6 4,287.3 31 Compensation of employees 2,511.4 2,690.0 2,907.6 2,935.1 2,997.2 3,061.7 3,118.2 3,171.9 32 Wages and salaries 2,094.8 2,249.4 2,429.0 2,452.2 2,505.1 2,560.7 2,608.8 2,654.7 33 Government and government enterprises 393.7 419.2 446.5 449.6 456.3 466.9 473.5 480.2 34 Other 1,701.1 1,830.1 1,982.5 2,002.6 2,048.9 2,093.8 2,135.3 2,174.5 35 Supplement to wages and salaries 416.6 440.7 478.6 482.9 492.0 501.0 509.4 517.2 36 Employer contributions for social insurance 217.3 227.8 249.7 251.8 255.6 259.7 263.4 266.6 37 Other labor income 199.3 212.8 228.9 231.1 236.5 241.3 246.0 250.7 38 Proprietors' income1 282.0 311.6 327.8 327.0 328.3 359.3 355.5 343.3 39 Business and professional1 247.2 270.0 288.0 289.3 296.3 300.3 304.2 307.2 40 Farm1 34.7 41.6 39.8 37.7 32.0 59.0 51.3 36.1 41 Rental income of persons2 11.6 13.4 15.7 16.3 16.1 11.8 9.8 5.4 42 Corporate profits1 282.1 298.7 328.6 330.9 340.2 316.3 307.8 295.2 43 Profits before tax 221.6 266.7 306.8 314.4 318.8 318.0 296.0 275.0 44 Inventory valuation adjustment 6.7 -18.9 -25.0 -30.4 -20.1 -38.3 —20.7R n.a. 45 Capital consumption adjustment 53.8 50.9 46.8 46.9 41.5 36.6 32.3 26.5 46 Net interest 325.5 351.7 392.9 396.4 415.7 436.1 458.4 471.5 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

A54 Domestic Nonfinancial Statistics • February 1990 2.17 PERSONAL INCOME AND SAVING Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted. 1988 1989 AAccccoouunntt 11998866 11998877 1988 Q3 Q4 QL Q2 Q3' PERSONAL INCOME AND SAVING 1 Total personal income 3,526.2 3,777.6 4,064.5 4,097.6 4,185.2 4,317.8 4,400.3 4,455.9 2 Wage and salary disbursements 2,094.8 2,249.4 2,429.0 2,452.2 2,505.1 2,560.7 2,608.8 2,654.7 3 Commodity-producing industries 625.6 649.9 696.3 701.6 714 7 726.6 733.7 742.6 4 Manufacturing 473.2 490.3 524.0 527.2 538.1 546.3 549.9 555.7 5 Distributive industries 498.8 531.9 571.9 578.0 587.5 598.8 610.8 619.4 6 Service industries 576.7 648.3 714.4 723.0 746.7 768.4 790.8 812.4 7 Government and government enterprises 393.7 419.2 446.5 449.6 456.3 466.9 473.5 480.2 8 Other labor income 199.3 212.8 228.9 231.1 236.5 241.3 246.0 250.7 9 Proprietors' income 282.0 311.6 327.8 327.0 328.3 359.3 355.5 343.3 10 Business and professional 247.2 270.0 288.0 289.3 296.3 300.3 304.2 307.2 11 Farm1 34.7 41.6 39.8 37.7 32.0 59.0 51.3 36.1 12 Rental income of persons2 11.6 13.4 15.7 16.3 16.1 11.8 9.8 5.4 13 Dividends 85.8 92.0 102.2 103.6 106.4 109.4 111.4 113.2 14 Personal interest income 493.2 523.2 571.1 576.3 598.6 629.0 655.1 667.8 15 Transfer payments 521.5 548.2 584.7 587.4 593.8 616.4 626.8 636.4 16 Old-age survivors, disability, and health insurance benefits ... 269.2 282.9 300.5 301.4 304.0 316.9 322.9 327.9 17 LESS: Personal contributions for social insurance 161.9 172.9 194.9 196.4 199.6 210.0 213.0 215.4 18 EQUALS: Personal income 3,526.2 3,777.6 4,064.5 4,097.6 4,185.2 4,317.8 4,400.3 4,455.9 19 LESS: Personal tax and nontax payments 512.9 571.7 586.6 585.9 597.8 628.3 652.6 649.1 20 EQUALS: Disposable personal income 3,013.3 3,205.9 3,477.8 3,511.7 3,587.4 3,689.5 3,747.7 3,806.8 21 LESS: Personal outlays 2,888.5 3,104.1 3,333.1 3,362.1 3,424.0 3,483.8 3,547.0 3,611.7 22 EQUALS: Personal saving 124.9 101.8 144.7 149.6 163.4 205.7 200.7 195.1 MEMO Per capita (1982 dollars) 23 Gross national product 15,385.5 15,793.9 16,332.8 16,387.1 16,455.3 16,566.4 1166,,662299..88 1166,,771111..88 24 Personal consumption expenditures 10,123.7 10,302.0 10,545.5 10,572.0 10,625.6 10,653.5 10,678.9 10,799.3 25 Disposable personal income 10,905.0 10,970.0 11,337.0 11,377.0 11,466.0 11,625.0 11,622.0 11,717.0 26 Saving rate (percent) 4.1 3.2 4.2 4.3 4.6 5.6 5.4 5.1 GROSS SAVING 27 Gross saving 525.3 553.8 642.4 669.8 647.4 693.5 695.8 709.9 28 Gross private saving 669.5 663.8 738.6 742.4 769.3 792.1 793.7 809.7 29 Personal saving 124.9 101.8 144.7 149.6 163.4 205.7 200.7 195.1 30 Undistributed corporate profits 84.5 75.3 80.3 77.6 81.7 53.4 52.0 49.3 31 Corporate inventory valuation adjustment 6.7 -18.9 -25.0 -30.4 -20.1 -38.3 —20.7r n.a. Capital consumption allowances 32 Corporate 285.9 303.1 321.7 332233..11 332299..77 333355..22 333399..77 n.a. 33 Noncorporate 174.2 183.6 191.9 192.1 194.4 197.8 201.3 n.a. 34 Government surplus, or deficit (-), national income and product accounts -144.1 -110.1 -96.1 -72.7 -121.9 -98.7 -97.9 --9999..88 -206.9 -161.4 -145.8 -122.5 -167.6 -147.5 -145.4 -144.7 36 State and local 62.8 51.3 49.7 49.8 45.7 48.8 47.5 44.9 523.6 549.0 632.8 661.2 630.8 669.3 677.5 684.3 38 Gross private domestic 659.4 699.9 750.3 771.1 752.8 769.6 775.0 779.1 -135.8 -150.9 -117.5 -109.9 -122.0 -100.3 -97.5 -94.8 40 Statistical discrepancy -1.8 -4.7 -9.6 -8.6 -16.6 -24.1 -18.3 -25.5 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 A55 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data are seasonally adjusted except as noted.1 1989 Item credits or debits 1986 1987 Q3 Q4 Ql Q2 Q3" 1 Balance on current account -133,249 -143,700 -126,548 -32,340 -28,677 -30,390 -32,084 -22,687 2 Not seasonally adjusted -36,926 -28,191 -25,994 -31,888 -27,718 3 Merchandise trade balance -145,058 -159,500 -127,215 -30,339 -32,019 -28,378 -27,554 -27,751 4 Merchandise exports 223,367 250,266 319,251 80,604 83,729 87,919 91,423 91,569 5 Merchandise imports -368,425 -409,766 -446,466 -110,943 -115,748 -116,297 -118,977 -119,320 6 Military transactions, net -4,577 -2,856 -4,606 -1,006 -1,604 -1,498 -1,518 -968 7 Investment income, net 60,629 71,151 61,974 12,806 21,329 15,527 13,400 21,096 8 Other service transactions, net 10,517 10,585 17,702 4,971 5,475 5,428 5,977 7,077 9 Remittances, pensions, and other transfers -4,049 -4,063 -4,279 -1,088 -1,090 -1,186 -1,011 -1,099 10 U.S. government grants (excluding military) -11,730 -10,149 -10,377 -2,288 -3,928 -2,340 -1,857 -2,557 11 Change in U.S. government assets, other than official reserve assets, net (increase, -) -2,024 997 2,999 1,961 3,413 1,049 -309 644 1 1 2 3 Ch G an o g ld e in U.S. official reserve assets (increase, -). 31 0 2 9,149 0 -3,566 0 -7,380 0 2,271 0 -4,000 0 -12,095 0 -5,9% 0 14 Special drawing rights (SDRs) -246 -509 474 -35 173 -188 68 -211 15 Reserve position in International Monetary Fund. 1,501 2,070 1,025 202 307 316 -159 337 16 Foreign currencies -942 7,588 -5,064 -7,547 1,791 -4,128 -12,004 -6,122 17 Change in U.S. private assets abroad (increase, -). -97,953 -86,363 -81,544 -32,467 -38,332 -28,367 12,781 -41,804 18 Bank-reported claims -59,975 -42,119 -54,481 -26,229 -30,916 -22,132 27,238 -20,702 19 Nonbank-reported claims -7,396 5,201 -1,684 255 4,569 1,835 -2,954 20 U.S. purchase of foreign securities, net -4,271 -5,251 -7,846 -1,592 -3,047 -2,568 -5,737 - io,138 21 U.S. direct investments abroad, net -26,311 -44,194 -17,533 -4,901 -8,938 -5,502 -5,766 -10,964 22 Change in foreign official assets in United States (increase, +) 35,594 45,193 38,882 -2,234 10,589 7,477 -5,201 11,246 23 U.S. Treasury securities 34,364 43,238 41,683 -3,769 11,897 4,634 -9,738 12,068 24 Other U.S. government obligations -1,214 1,564 1,309 572 697 721 -97 190 25 Other U.S. government liabilities 2,141 -2,520 -1,284 -232 -232 -304 417 -547 26 Other U.S. liabilities reported by U.S. banks3 1,187 3,918 -331 1,703 -1,036 1,974 3,620 -1,117 27 Other foreign official assets5 -884 -1,007 -2,495 -508 -737 452 597 652 28 Change in foreign private assets in United States (increase, +) , 186,011 172,847 180,417 48,413 70,170 52,529 3,412 61,236 29 U.S. bank-reported liabilities3 79,783 89,026 68,832 23,291 32,223 13,261 -21,422 25,688 30 U.S. nonbank-reported liabilities -2,641 2,450 6,558 2,350 2,702 2,852 -361 31 Foreign private purchases of U.S. Treasury securities, net 3,809 -7,643 20,144 3,422 5,336 8,590 2,252 i3,034 32 Foreign purchases of other U.S. securities, net 70,969 42,120 26,448 7,454 6,871 8,665 9,676 11,082 33 Foreign direct investments in United States, net 34,091 46,894 58,435 11,896 23,038 19,161 13,267 11,432 34 Allocation of SDRs 0 0 0 0 0 0 0 0 35 Discrepancy 11,308 1,878 -10,641 24,047 -19,434 1,702 33,496 -2,639 36 Owing to seasonal adjustments -4,556 4,431 4,127 -2,311 -5,115 37 Statistical discrepancy in recorded data before seasonal adjustment 11,308 1,878 28,603 -23,865 -2,425 35,807 2,476 MEMO Changes in official assets 38 U.S. official reserve assets (increase, -) 312 9,149 -3,566 -7,380 2,271 -4,000 -12,095 -5,9% 39 Foreign official assets in United States (increase, +) excluding line 25 33,453 47,713 40,166 -2,002 10,821 7,781 -5,618 11,793 40 Change in Organization of Petroleum Exporting Countries official assets in United States (part of line 22 above) -9,327 -9,955 -3,109 -459 672 7,143 433 3,776 41 Transfers under military grant programs (excluded from lines 4, 6, and 10 above) 96 53 92 7 40 12 13 15 1. Seasonal factors are not calculated for lines 6, 10, 12-16, 18-20, 22-34, and 4. Primarily associated with military sales contracts and other transactions 38-41. arranged with or through foreign official agencies. 2. Data are on an international accounts (IA) 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 3. Reporting banks include all kinds of depository institutions besides commer- Business (Department of Commerce). cial banks, as well as some brokers and dealers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A56 International Statistics • February 1990 3.11 U.S. FOREIGN TRADE1 Millions of dollars; monthly data are seasonally adjusted. 1989 IItteemm 11998866 11998877 11998888 Apr. May June July Aug. Sept/ Oct." 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments, f.a.s. value 227,158 254,073 322,426 30,759 30,455 31,286 30,468 30,562 30,680 31,010 GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded warehouses 2 Customs value 365,438 406,241 440,952 39,045 40,534 39,293 38,709 40,662 39,194 41,210 Trade balance 3 Customs value -138,279 -152,169 -118,526 -8,286 -10,079 -8,007 -8,241 -10,101 -8,513 -10,201 1. The Census basis data differ from merchandise trade data shown in table tions; military payments are excluded and shown separately as indicated above. 3.10, U.S. International Transactions Summary, for reasons of coverage and As of Jan. 1, 1987 census data are released 45 days after the end of the month; the timing. On the export side, the largest adjustment is the exclusion of military sales previous month is revised to reflect late documents. Total exports and the trade (which are combined with other military transactions and reported separately in balance reflect adjustments for undocumented exports to Canada. the '' service account'' in table 3.10, line 6). On the import side, additions are made SOURCE. FT900 "Summary of U.S. Export and Import Merchandise Trade" for gold, ship purchases, imports of electricity from Canada, and other transac- (Department of Commerce, Bureau of the Census). 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period Type 1986 1987 May July Aug. Sept. Oct. Nov.p 1 Total 43,186 48,511 45,798 54,941 60,502 63,462 62,364 68,418 70,809 72,572 2 Gold stock, including Exchange 11,090 11,064 11,078 11,060 11,063 11,066 11,066 11,065 11,062 11,060 Stabilization Fund 7,293 8,395 10,283 9,134 9,034 9,340 9,240 9,487 9,473 9,751 3 Special drawing rights2,3 4 ReseMrvoe npeotasriyti oFnu innd International 11,947 11,730 11,349 8,513 9,055 8,644 8,786 8,722 9,059 5 Foreign currencies4 12,856 17,322 13,088 26,234 31,517 34,001 33,413 39,080 41,552 42,702 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 BANKS1 Millions of dollars, end of period 1989 AAsssseettss 11998866 11998877 11998888 May June July Aug. Sept. Oct. Nov/ 1 Deposits 287 244 347 428 275 371 265 325 252 307 Assets held in custody 2 2 U.S. Treasury securities 155,835 195,126 232,547 232,004 229,914 233,170 238,007 235,597 230,804 231,059 3 Earmarked gold 14,048 13,919 13,636 13,612 13,545 13,530 13,516 13,506 13,460 13,458 1. Excludes deposits and U.S. Treasury securities held for international and 3. Earmarked gold and the gold stock are valued at $42.22 per fine troy ounce, regional organizations. Earmarked gold is gold held for foreign and international accounts and is not 2. Marketable U.S. Treasury bills, notes, and bonds; and nonmarketable U.S. included in the gold stock of the United States. Treasury securities payable in dollars and in foreign currencies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Summary Statistics A57 3.14 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data1 Millions of dollars, end of period 1989 Apr. May June July Aug. Sept. Oct. All foreign countries 1 Total, all currencies 456,628 518,618 506,062 517,276 521,436 523,674 534,200 522,489' 520,845' 533,641 2 Claims on United States 114,563 138,034 169,111 171,136 177,987 177,445 179,615 177,299' 182,440' 183,156 3 Parent bank 83,492 105,845 129,856 128,567 134,026 132,380 133,135 134,479' 142,339' 142,422 4 Other banks in United States 13,685 16,416 14,918 13,459 13,040 14,218 15,744 15,225 14,164 14,143 5 Nonbanks 17,386 15,773 24,337 29,110 30,921 30,847 30,736 27,595 25,937 26,591 6 Claims on foreigners 312,955 342,520 299,728 305,483 302,808 303,720 310,426 299,265' 289,996' 303,426 7 Other branches of parent bank 96,281 122,155 107,179 113,824 116,506 115,913 117,438 108,893' 104,683' 113,2% 8 Banks 105,237 108,859 96,932 96,830 94,042 94,902 95,621 92,465' 90,51(y 93,357 9 Public borrowers 23,706 21,832 17,163 16,101 16,095 16,709 16,948 16,656' 16,215' 16,721 10 Nonbank foreigners 87,731 89,674 78,454 78,728 76,165 76,196 80,419 81,251' 78,588' 80,052 11 Other assets 29,110 38,064 37,223 40,657 40,641 42,509 44,159 45,925' 48,409' 47,059 12 Total payable in U.S. dollars 317,487 350,107 358,040 359,841 366,315 367,562 371,851 369,287' 359,924' 368,643 13 Claims on United States 110,620 132,023 163,456 163,964 169,7% 169,520 171,041 170,497 174,628' 174,879 14 Parent bank 82,082 103,251 126,929 124,268 128,771 127,352 128,063 130,168 137,481' 136,612 15 Other banks in United States 12,830 14,657 14,167 12,539 11,909 13,207 14,734 14,688 13,217 13,597 16 Nonbanks 15,708 14,115 22,360 27,157 29,116 28,961 28,244 25,641 23,930 24,670 17 Claims on foreigners 195,063 202,428 177,685 178,298 177,308 180,013 181,441 177,911' 164,461' 173,048 18 Other branches of parent bank 72,197 88,284 80,736 86,767 86,625 88,874 90,077 83,036' 77,858' 85,302 19 Banks 66,421 63,707 54,884 50,815 49,793 50,627 49,913 50,885' 46,786' 47,349 20 Public borrowers 16,708 14,730 12,131 11,467 11,282 11,815 11,616 11,774' 11,646 11,579 21 Nonbank foreigners 39,737 35,707 29,934 29,249 29,608 28,697 29,835 32,216' 28,171 28,818 22 Other assets 11,804 15,656 16,899 17,579 19,211 18,029 19,369 20,879' 20,835' 20,716 United Kingdom 23 Total, all currencies 140,917 158,695 156,835 153,146 155,532 153,968 161,882 158,860' 157,673' 164,155 24 Claims on United States 24,599 32,518 40,089 39,475 39,599 38,014 42,147 41,914 40,085 43,687 25 Parent bank 19,085 27,350 34,243 34,741 35,642 33,763 37,713 38,031 36,046 38,938 26 Other banks in United States 1,612 1,259 1,123 1,227 1,243 1,125 1,121 1,112 1,265 1,200 27 Nonbanks 3,902 3,909 4,723 3,507 2,714 3,126 3,313 2,771 2,774 3,549 28 Claims on foreigners 109,508 115,700 106,388 102,438 104,504 103,773 106,586 102,231' 102,097' 106,430 29 Other branches of parent bank 33,422 39,903 35,625 32,954 35,537 34,948 35,440 32,392 32,611' 35,252 30 Banks 39,468 36,735 36,765 37,079 37,412 37,357 36,519 36,073' 37,146 38,048 31 Public borrowers 4,990 4,752 4,019 3,471 3,627 3,599 3,788 3,586 3,265 3,346 32 Nonbank foreigners 31,628 34,310 29,979 28,934 27,928 27,869 30,839 30,180 29,075 29,784 33 Other assets 6,810 10,477 10,358 11,233 11,429 12,181 13,149 14,715' 15,491' 14,038 34 Total payable in U.S. dollars 95,028 100,574 103,503 98,463 101,612 99,028 103,512 104,036' 99,238' 106,869 35 Claims on United States 23,193 30,439 38,012 36,772 36,675 34,990 38,506 39,135 37,108 40,978 36 Parent bank 18,526 26,304 33,252 33,499 34,119 32,059 36,041 36,375 34,537 37,404 37 Other banks in United States 1,475 1,044 964 872 862 844 821 1,007 1,017 951 38 Nonbanks 3,192 3,091 3,796 2,401 1,694 2,087 1,644 1,753 1,554 2,623 39 Claims on foreigners 68,138 64,560 60,472 56,227 58,395 58,746 59,137 57,706' 55,340' 59,389 40 Other branches of parent bank 26,361 28,635 28,474 25,389 26,036 26,541 27,955 25,368 25,542' 28,084 41 Banks 23,251 19,188 18,494 17,680 18,458 18,745 17,080 18,298' 17,612 18,275 42 Public borrowers 3,677 3,313 2,840 2,6% 2,737 2,606 2,702 2,679 2,521 2,553 43 Nonbank foreigners 14,849 13,424 10,664 10,462 11,164 10,854 11,400 11,361 9,665 10,477 44 Other assets 3,697 5,575 5,019 5,464 6,542 5,292 5,869 7,195' 6,790' 6,502 Bahamas and Caymans 45 Total, all currencies 142,592 160,321 170,639 172,324 173,137 171,780 172,789 165,401 164,684 164,836 46 Claims on United States 78,048 85,318 105,320 105,273 111,823 109,800 107,831 106,693 111,043 109,910 47 Parent bank 54,575 60,048 73,409 68,969 73,627 70,735 67,417 69,404 76,426 75,900 48 Other banks in United States 11,156 14,277 13,145 11,563 10,807 12,116 13,712 13,294 12,141 11,954 49 Nonbanks 12,317 10,993 18,766 24,741 27,389 26,949 26,702 23,995 22,476 22,056 50 Claims on foreigners 60,005 70,162 58,393 60,103 53,984 54,537 57,135 50,808 45,962 47,214 51 Other branches of parent bank 17,296 21,277 17,954 26,261 21,962 22,324 24,462 16,802 14,688 16,961 52 Banks 27,476 33,751 28,268 22,641 21,184 21,202 21,591 20,688 20,162 19,579 53 Public borrowers 7,051 7,428 5,830 5,374 5,280 5,540 5,405 5,407 5,435 5,289 54 Nonbank foreigners 8,182 7,706 6,341 5,827 5,558 5,471 5,677 7,911 5,677 5,385 55 Other assets 4,539 4,841 6,926 6,948 7,330 7,443 7,823 7,900 7,679 7,712 56 Total payable in U.S. dollars 136,813 151,434 163,518 166,389 166,869 165,676 167,259 160,821 160,274 159,643 1. Beginning with June 1984 data, reported claims held by foreign branches from $50 million to $150 million equivalent in total assets, the threshold now have been reduced by an increase in the reporting threshold for "shell" branches applicable to all reporting branches. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 International Statistics • February 1990 3.14—Continued 1989 Liability account 1986 1987 1988 Apr. May July Aug. Sept. All foreign countries 57 Total, all currencies 456,628 518,618 506,062 517,276 521,436 523,674 534,200 522,489' 520,845' 533,641 58 Negotiable CDs 31,629 30,929 28,511 30,278 29,425 28,116 28,882 29,524 26,679 26,776 59 To United States 152,465 161,390 185,577 179,292 178,821 179,858 177,706 177,485' 183,129' 182,438 60 Parent bank 83,394 87,606 114,720 109,164 110,579 113,395' 110,326' 110,917' 121,003' 122,141 61 Other banks in United States 15,646 20,355 14,737 14,307 13,564 12,951 13,323 13,269 13,015 11,476 62 Nonbanks 53,425 53,429 56,120 55,821 54,678 53,512' 54,057' 53,299' 49,111 48,821 63 To foreigners 253,775 304,803 270,923 282,920 288,291 289,603 301,422 288,623' 283,509' 295,624 64 Other branches of parent bank 95,146 124,601 111,267 115,380 121,135 118,950 119,571 113,352' 104,382' 114,607 65 Banks 77,809 87,274 72,842 72,155 72,903 74,213 80,070 75,992' 78,089' 76,420 66 Official institutions 17,835 19,564 15,183 17,933 17,795 17,559 18,846 17,591' 17,349 19,361 67 Nonbank foreigners 62,985 73,364 71,631 77,452 76,458 78,881 82,935 81,688' 83,689' 85,236 68 Other liabilities 18,759 21,496 21,051 24,786 24,899 26,097 26,190 26,857' 27,528' 28,803 69 Total payable in U.S. dollars ... 336,406 361,438 367,483 372,788 376,474 378,331 381,879 379,771' 371,301' 384,809 70 Negotiable CDs 28,466 26,768 24,045 25,970 25,411 24,129 24,914 25,483 22,927 22,260 71 To United States 144,483 148,442 173,190 166,666 166,134 167,217 163,771 165,984' 170,438' 170,320 72 Parent bank 79,305 81,783 107,150 100,897 102,643 105,074' 100,726' 103,3%' 112,255' 114,226 73 Other banks in United States 14,609 18,951 13,468 12,781 11,944 11,537 11,845 11,964 11,837 10,273 74 Nonbanks 50,569 47,708 52,572 52,988 51,547 50,606' 51,200' 50,624' 46,346 45,821 75 To foreigners 156,806 177,711 160,766 169,758 173,228 175,393 181,005 175,327' 165,395' 179,155 76 Other branches of parent bank 71,181 90,469 84,021 87,716 90,123 90,850 91,713 86,723' 77,516' 86,522 77 Banks 33,850 35,065 28,493 28,445 29,567 29,686 31,216 32,342' 30,703 32,648 78 Official institutions 12,371 12,409 8,224 9,591 9,255 9,852 11,176 10,680 10,195 11,445 79 Nonbank foreigners 39,404 39,768 40,028 44,006 44,283 45,005 46,900 45,582' 46,981' 48,540 80 Other liabilities 6,651 8,517 9,482 10,394 11,701 11,592 12,189 12,977' 12,541' 13,074 United Kingdom 81 Total, all currencies 140,917 158,695 156,835 153,146 155,532 153,968 161,882 158,860' 157,673' 164,155 82 Negotiable CDs 27,781 26,988 24,528 26,157 25,539 24,396 25,342 25,905 23,122 23,152 83 To United States 24,657 23,470 36,784 29,715 30,867 30,013 29,954 31,551 31,076 34,181 84 Parent bank 14,469 13,223 27,849 20,455 20,329 22,037' 19,885' 21,841' 24,013 25,061 85 Other banks in United States . 2,649 1,536 2,037 1,551 1,720 1,648 1,852 1,767 1,687 2,002 86 Nonbanks 7,539 8,711 6,898 7,709 8,818 6,328' 8,217' 7,943' 5,376 7,118 87 To foreigners 79,498 98,689 86,026 87,478 88,985 88,381 94,335 88,661 91,101 93,700 88 Other branches of parent bank 25,036 33,078 26,812 25,800 26,867 24,974 26,556 24,326 24,769 26,936 89 Banks 30,877 34,290 30,609 30,714 30,925 31,066 33,047 30,790 31,330 30,688 90 Official institutions 6,836 11,015 7,873 8,637 8,946 8,650 9,586 8,868 8,878 10,132 91 Nonbank foreigners 16,749 20,306 20,732 22,327 22,247 23,691 25,146 24,677 26,124 25,944 92 Other liabilities 8,981 9,548 9,497 9,7% 10,141 11,178 12,251 12,743' 12,374' 13,122 93 Total payable in U.S. dollars 99,707 102,550 105,907 102,065 104,356 101,742 105,700 106,915 102,361' 110,358 94 Negotiable CDs 26,169 24,926 22,063 24,073 23,568 22,324 23,132 23,679 21,156 20,433 95 To United States 22,075 17,752 32,588 25,493 26,554 25,401 24,618 27,232 26,592 30,433 % Parent bank 14,021 12,026 26,404 18,524 18,545 19,556' 16,909' 19,580' 21,588 23,247 97 Other banks in United States . 2,325 1,308 1,752 1,227 1,368 1,393 1,477 1,502 1,511 1,835 98 Nonbanks 5,729 4,418 4,432 5,742 6,641 4,452' 6,232' 6,150' 3,493 5,351 99 To foreigners 48,138 55,919 47,083 47,781 49,006 48,491 52,179 49,913 48,557 52,902 100 Other branches of parent bank 17,951 22,334 18,561 17,755 18,030 16,467 18,388 17,060 16,673 18,926 101 Banks 15,203 15,580 13,407 13,439 13,930 13,545 14,173 13,578 12,331 13,177 102 Official institutions 4,934 7,530 4,348 4,365 4,7% 5,579 6,131 5,825 5,532 6,605 103 Nonbank foreigners 10,050 10,475 10,767 12,222 12,250 12,900 13,487 13,450 14,021 14,194 104 Other liabilities 3,325 3,953 4,173 4,718 5,228 5,526 5,771 6,091 6,056' 6,590 Bahamas and Caymans 105 Total, all currencies 142,592 160,321 170,639 172,324 173,137 171,780 172,789 165,401 164,684 164,836 106 Negotiable CDs 847 885 953 1,025 872 696 717 691 669 669 107 To United States 106,081 113,950 122,332 118,164 120,175 117,737 116,261 113,122 117,537' 114,651 108 Parent bank 49,481 53,239 62,894 59,762 64,908 61,642 61,263 58,765 64,859' 66,292 109 Other banks in United States 11,715 17,224 11,494 11,346 10,398 10,034 10,197 10,076 10,026 8,088 110 Nonbanks 44,885 43,487 47,944 47,056 44,869 46,061 44,801 44,281 42,652 40,271 111 To foreigners 34,400 43,815 45,161 50,606 48,989 50,477 52,881 48,769 43,892 46,956 112 Other branches of parent bank 12,631 19,185 23,686 27,655 26,478 27,763 29,085 25,370 20,207 22,425 113 Banks 8,617 10,769 8,336 8,203 8,233 8,322 8,309 9,016 9,273 9,647 114 Official institutions 2,719 1,504 1,074 1,722 1,164 1,102 1,223 1,081 928 1,003 115 Nonbank foreigners 10,433 12,357 12,065 13,026 13,114 13,290 14,264 13,302 13,484 13,881 116 Other liabilities 1,264 1,671 2,193 2,529 3,101 2,870 2,930 2,819 2,586' 2,560 117 Total payable in U.S. dollars 138,774 152,927 162,950 166,489 166,954 165,593 166,988 160,800 160,133 160,028 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Summary Statistics A59 3.15 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1989 IItteemm 11998877 11998888 Apr. May June July Aug. Sept.' Oct." 1 Total1 259,556 299,677 307,667 313,637 306,420 302,048 307,369' 317,403 313,843 By type 2 Liabilities reported by banks in the United States 31,838 31,414 33,594 39,116 38,036 37,214 39,044' 37,958 36,098 3 U.S. Treasury bills and certificates3 88,829 110033,,772222 9955,,447788 96,109 9911,,779988 8877,,119900 8877,,773344 8888,,332255 8855,,777755 U.S. Treasury bonds and notes 4 Marketable 122,432 149,056 161,923 161,081 160,013 160,462 163,281 173,238 173,934 3 Nonmarketable 300 523 534 538 542 545 549 553 557 6 U.S. securities other than U.S. Treasury securities 16,157 14,962 16,138 16,793 16,031 16,637 16,761 17,329 17,479 By area 7 Western Europe1 124,620 125,097 125,584 129,254 126,222 122,502 126,361 134,140 133,174 8 4,961 9,584 10,156 9,994 9,938 9,604 9,424 9,560 8,989 9 Latin America and Caribbean 8,328 10,099 7,524 7,168 6,091 5,925 7,166 7,986 8,924 10 Asia 116,098 145,504 156,264 158,564 156,073 155,372 155,811' 157,100 154,308 11 1,402 1,369 1,119 1,065 1,182 1,271 949 810 867 12 Other countries6 4,147 7,501 6,485 7,053 6,371 6,830 7,113 7,257 7,024 1. Includes the Bank for International Settlements. bonds and notes payable in foreign currencies. 2. Principally demand deposits, time deposits, bankers acceptances, commer- 5. Debt securities of U.S. government corporations and federally sponsored cial paper, negotiable time certificates of deposit, and borrowings under repur- agencies, and U.S. corporate stocks and bonds. chase agreements. 6. Includes countries in Oceania and Eastern Europe. 3. Includes nonmarketable certificates of indebtedness (including those payable NOTE. Based on Treasury Department data and on data reported to the in foreign currencies through 1974) and Treasury bills issued to official institutions Treasury Department by banks (including Federal Reserve Banks) and securities of foreign countries. dealers in the United States. 4. Excludes notes issued to foreign official nonreserve agencies. Includes 3.16 LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in Foreign Currencies1 Millions of dollars, end of period 1988 1989 IItteemm 11998855 11998866 11998877 Dec. Mar. June Sept. 1 Banks' own liabilities 111555,,,333666888 222999,,,777000222 555555,,,444333888 777444,,,888333666 777666,,,222666222 666888,,,444888333 777222,,,555666000 2 Banks' own claims 111666,,,222999444 222666,,,111888000 555111,,,222777111 666888,,,999888333 777222,,,888111222 666222,,,888000888 777000,,,777111111 888,,,444333777 111444,,,111222999 111888,,,888666111 222555,,,111000000 222555,,,888444666 222333,,,888222555 222333,,,999888333 777,,,888555777 111222,,,000555222 333222,,,444111000 444333,,,888888444 444666,,,999666666 333888,,,999888333 444666,,,777222888 5 Claims of banks' domestic customers2 555888000 222,,,555000777 555555111 333666444 333777666 777222333 222,,,555555888 1. Data on claims exclude foreign currencies held by U.S. monetary author- 2. Assets owned by customers of the reporting bank located in the United ities. States that represent claims on foreigners held by reporting banks for the accounts of the domestic customers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A60 International Statistics • February 1990 3.17 LIABILITIES TO FOREIGNERS Reported by Banks in the United States1 Payable in U.S. dollars Millions of dollars, end of period 1989 Holder and type of liability 11998866 11998877 11998888 Apr. May June July Aug. Sept.' Oct." 1 All foreigners 540,9% 618,874 684,444 682,850 678,059 672,049 663,725 679,568' 693,954 700,787 2 Banks' own liabilities 406,485 470,070 513,840 516,025 512,334 510,524 501,541 516,458r 530,162 540,512 3 Demand deposits 23,789 22,383 21,863 22,325 21,920 21,224 21,351 19,718 21,551 21,093 4 Time deposits 130,891 148,374 152,020 156,982 154,768 152,801 149,355 155,461' 157,048 162,300 5 Other. 42,705 51,677 51,525 56,413 58,822 61,317 64,636 63,489' 56,167 65,359 6 Own foreign offices4 209,100 247,635 288,432 280,304 276,824 275,183 266,200 277,790' 295,397 291,760 7 Banks' custody liabilities5 134,511 148,804 170,604 166,825 165,725 161,525 162,184 163,1 llr 163,792 160,275 8 U.S. Treasury bills and certificates6 90,398 101,743 115,056 106,916 102,734 98,893 99,365 99,683 99,254 95,291 9 Other negotiable and readily transferable instruments7 15,417 16,776 16,426 17,278 18,541 17,078 16,893 17,260' 17,051 16,344 10 Other 28,6% 30,285 39,121 42,631 44,451 45,555 45,925 46,168 47,487 48,640 11 Nonmonetary international and regional organizations8 5,807 4,464 3,224 4,002 3,415 3,617 4,240 4,418 4,945 6,281 12 Banks' own liabilities 3,958 2,702 2,527 3,216 2,980 2,695 2,716 3,402 3,347 4,274 13 Demand deposits 199 124 71 163 76 32 41 66 90 53 14 Time deposits 2,065 1,538 1,183 1,502 1,202 1,254 918 1,079 1,702 1,615 15 Other. 1,693 1,040 1,272 1,551 1,702 1,409 1,756 2,257 1,554 2,606 16 Banks' custody liabilities5 1,849 1,761 698 786 435 922 1,524 1,016 1,598 2,007 17 U.S. Treasury bills and certificates6 259 265 57 77 95 181 345 107 84 539 18 Other negotiable and readily transferable instruments 1,590 1,497 641 693 305 731 1,179 909 1,479 1,454 19 Other 0 0 0 16 35 10 0 1 35 14 20 Official institutions9 103,569 120,667 135,136 135,225 129,835 124,404 126,778 126,506' 122,593 122,497 21 Banks' own liabilities 25,427 28,703 27,004 33,036 31,738 31,891 33,960 33,248' 31,465 35,995 22 Demand deposits 2,267 1,757 1,915 1,782 1,761 1,801 1,947 1,625 2,026 2,057 23 Time deposits 10,497 12,843 9,657 12,439 11,144 9,924 9,937 8,837' 8,994 11,877 24 Other3 12,663 14,103 15,432 18,815 18,833 20,166 22,077 22,786' 20,445 22,062 25 Banks' custody liabilities5 78,142 91,965 108,132 102,189 98,097 92,513 92,818 93,258 91,127 86,502 26 U.S. Treasury bills and certificates6 75,650 88,829 103,722 %,109 91,798 87,190 87,734 88,325 86,350 81,465 27 Other negotiable and readily transferable instruments7 2,347 2,990 4,130 5,875 6,114 5,080 4,821 4,735 4,588 4,734 28 Other 145 146 280 205 185 244 263 198 189 303 29 Banks10 351,745 414,280 458,672 453,554 454,442 451,337 441,639 457,351' 475,733 478,644 30 Banks' own liabilities 310,166 371,665 408,854 401,646 399.823 395,603 385,773 400,863' 415,467 417,806 31 Unaffiliated foreign banks 101,066 124,030 120,422 121,342 122,999 120,421 119,574 123,073' 120,070 126,047 32 Demand deposits 10,303 10,898 9,950 10,560 11,162 9,677 10,145 9,101 10,695 9,887 33 Time deposits 64,232 79,717 80,155 80,796 78,901 77,231 74,929 80,606' 80,599 83,525 34 Other3 26,531 33,415 30,318 29,987 32,936 33,513 34,499 33,367' 28,776 32,635 35 Own foreign offices4 209,100 247,635 288,432 280,304 276.824 275,183 266,200 277,790' 295,397 291,760 36 Banks' custody liabilities5 41,579 42,615 49,818 51,908 54,619 55,734 55,865 56,488' 60,265 60,838 37 U.S. Treasury bills and certificates6 9,984 9,134 7,602 6,921 7,114 7,759 7,674 7,838 9,077 9,258 38 Other negotiable and readily transferable instruments 5,165 5,392 5,725 5,051 5,686 5,314 5,326 5,284' 5,050 4,415 39 Other 26,431 28,089 36,491 39,936 41,819 42,662 42,866 43,365 46,138 47,165 40 Other foreigners 79,875 79,463 87,411 90,068 90,366 92,691 91,068 91,293' 90,684 93,364 41 Banks' own liabilities 66,934 67,000 75,456 78,126 77,792 80,335 79,092 78,944' 79,883 82,437 42 Demand deposits 11,019 9,604 9,928 9,820 8,921 9,714 9,218 8,926 8,739 9,0% 43 Time deposits2 54,097 54,277 61,025 62,245 63,521 64,392 63,571 64,938' 65,752 65,284 44 Other3 1,818 3,119 4,503 6,060 5,351 6,229 6,303 5,080 5,392 8,057 45 Banks' custody liabilities5 12,941 12,463 11,956 11,942 12,574 12,356 11,976 12,349 10,801 10,928 46 U.S. Treasury bills and certificates6 4,506 3,515 3,675 3,809 3,725 3,763 3,612 3,413 3,743 4,028 47 Other negotiable and readily transferable instruments7 6,315 6,898 5,929 5,658 6,436 5,953 5,566 6,332 5,934 5,741 48 Other 2,120 2,050 2,351 2,474 2,412 2,639 2,797 2,604 1,125 1,159 49 MEMO: Negotiable time certificates of deposit in custody for foreigners 7,4% 7,314 6,425 5,554 5,625 5,337 5,261 5,199' 5,238 5,162 1. Reporting banks include all kinds of depository institutions besides commer- 5. Financial claims on residents of the United States, other than long-term cial banks, as well as some brokers and dealers. securities, held by or through reporting banks. 2. Excludes negotiable time certificates of deposit, which are included in 6. Includes nonmarketable certificates of indebtedness and Treasury bills "Other negotiable and readily transferable instruments." issued to official institutions of foreign countries. 3. Includes borrowing under repurchase agreements. 7. Principally bankers acceptances, commercial paper, and negotiable time 4. U.S. banks: includes amounts due to own foreign branches and foreign certificates of deposit. subsidiaries consolidated in "Consolidated Report of Condition" filed with bank 8. Principally the International Bank for Reconstruction and Development, and regulatory agencies. Agencies, branches, and majority-owned subsidiaries of the Inter-American and Asian Development Banks. Data exclude "holdings of foreign banks: principally amounts due to head office or parent foreign bank, and dollars" of the International Monetary Fund. foreign branches, agencies, or wholly owned subsidiaries of head office or parent 9. Foreign central banks, foreign central governments, and the Bank for foreign bank. International Settlements. 10. Excludes central banks, which are included in "Official institutions." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A61 3.17—Continued 1989 AArreeaa aanndd ccoouunnttrryy 11998866 11998877 11998888 Apr. May June July Aug. Sept.' Oct." 1 Total 540,996 618,874 684,444 682,850 678,059 672,049 663,725 679,568' 693,954 700,787 2 Foreign countries 535,189 614,411 681,219 678,848 674,644 668,432 659,485 675,150' 689,010 694,506 3 Europe 180,556 234,641 235,989 230,769 228,141 226,058 226,264 226,491' 221,836 232,571 4 Austria 1,181 920 1,155 1,608 1,405 1,505 1,417 1,404 1,345 1,224 5 Belgium-Luxembourg 6,729 9,347 10,022 10,115 8,819 8,624 8,949 9,286 10,088 10,819 6 Denmark 482 760 2,180 1,615 1,642 1,179 1,348 1,956' 1,265 1,079 7 Finland 580 377 284 397 432 450 435 46C 526 464 8 France 22,862 29,835 24,762 25,629 24,199 23,864 22,290 24,864 22,%5 23,934 9 Germany 5,762 7,022 6,772 6,967 7,791 9,198 8,715 7,651' 8,345 9,326 10 Greece 700 689 672 927 1,172 889 862 828 797 842 11 Italy 10,875 12,073 14,599 12,959 12,527 13,951 12,892 14,597 14,492 14,426 12 Netherlands 5,600 5,014 5,316 5,610 5,870 4,875 5,029 5,106 4,944 5,418 13 Norway 735 1,362 1,559 1,783 1,479 1,485 1,522 1,453 1,698 1,342 14 Portugal 699 801 903 824 985 1,089 1,419 1,945 2,206 2,291 15 Spain 2,407 2,621 5,494 5,795 5,419 5,085 5,910 5,390 5,277 4,985 16 Sweden 884 1,379 1,274 1,730 1,552 1,478 1,248 2,002 1,706 1,671 17 Switzerland 30,534 33,766 34,179 29,239 28,448 28,806 28,581 28,931' 28,975 29,552 18 Turkey 454 703 1,012 1,051 785 737 1,053 1,022' 1,086 1,199 19 United Kingdom 85,334 116,852 115,954 111,492 112,622 107,300 109,601 104,18c 102,379 107,137 20 Yugoslavia 630 710 529 465 478 558 604 691 774 857 21 Other Western Europe1 3,326 9,798 8,598 11,519 11,887 14,322 13,655 13,824 12,162 15,030 22 U.S.S.R 80 32 138 91 193 164 175 201 244 338 23 Other Eastern Europe 702 582 591 953 435 499 559 699' 562 638 24 Canada 26,345 30,095 21,040 23,024 18,353 17,514 17,472 16,958 17,960 16,885 25 Latin America and Caribbean 210,318 220,372 266,803 266,446 270,431 266,509 260,712 275,418' 284,891 282,955 26 Argentina 4,757 5,006 7,804 6,280 6,459 6,320 7,397 8,047 8,446 8,068 27 Bahamas 73,619 74,767 86,863 86,057 90,979 82,104 84,526 90,317 90,622 93,119 28 Bermuda 2,922 2,344 2,621 2,373 2,451 2,356 2,269 2,209' 2,124 2,436 29 Brazil 4,325 4,005 5,304 5,554 5,302 5,026 5,396 5,539 5,892 6,079 30 British West Indies 72,263 81,494 109,507 111,969 111,270 116,607 107,579 115,731' 122,539 117,350 31 Chile 2,054 2,210 2,936 2,933 2,988 2,733 2,683 2,739 2,765 3,013 32 Colombia 4,285 4,204 4,374 4,173 4,033 4,127 4,235 4,365 4,199 4,887 33 Cuba 7 12 10 10 15 10 9 10 14 10 34 Ecuador 1,236 1,082 1,379 1,376 1,285 1,351 1,411 1,376 1,363 1,342 35 Guatemala 1,123 1,082 1,195 1,272 1,232 1,251 1,297 1,279 1,293 1,275 36 Jamaica 136 160 269 222 188 294 227 231 233 206 37 Mexico 13,745 14,480 15,185 14,367 14,060 14,211 13,679 13,769' 14,981 14,658 38 Netherlands Antilles 4,970 4,975 6,420 5,769 6,072 6,316 6,434 6,071 6,0% 5,948 39 Panama 6,886 7,414 4,353 4,355 4,454 4,278 4,357 4,400 4,424 4,382 40 Peru 1,163 1,275 1,671 1,763 1,724 1,761 1,770 1,778 1,828 1,910 41 Uruguay 1,537 1,582 1,898 2,263 2,344 2,429 2,152 2,121 2,340 2,214 42 Venezuela 10,171 9,048 9,147 9,565 9,435 9,431 9,500 9,398' 9,520 9,550 43 Other 5,119 5,234 5,868 6,145 6,140 5,903 5,790 6,039' 6,213 6,505 44 Asia 110088,,883311 121,288 147,230 114488,,667766 114477,,335533 114488,,333399 114444,,007733 114455,,550055'' 115533,,552244 115500,,008855 China 45 Mainland 1,476 1,162 1,892 1,809 1,652 1,432 1,522 1,700 1,804 1,989 46 Taiwan 18,902 21,503 26,058 28,284 26,928 27,025 27,125 25,427' 24,119 22,399 47 Hong Kong 9,393 10,180 11,738 11,403 12,215 12,132 11,346 12,268' 12,292 11,826 48 India 674 582 699 1,787 1,009 812 871 940 875 1,133 49 Indonesia 1,547 1,404 1,180 1,154 1,306 1,232 1,0% 1,042 1,042 1,144 50 Israel 1,892 1,292 1,461 967 1,103 1,088 1,058 953 1,041 2,221 51 Japan 47,410 54,322 73,957 72,689 70,468 71,130 68,670 70,616' 78,824 72,700 52 Korea 1,141 1,637 2,541 3,023 3,166 3,047 3,556 2,907 3,037 3,099 53 Philippines 1,866 1,085 1,163 973 991 984 936 1,083 1,055 1,148 54 Thailand 1,119 1,345 1,236 1,165 1,162 1,274 1,254 1,776 1,430 1,692 55 Middle-East oil-exporting countries 12,352 13,988 12,083 12,098 13,505 13,612 12,368 12,524 13,026 13,443 56 Other 11,058 12,788 13,223 13,324 13,851 14,571 14,271 14,270 14,979 17,292 57 Africa 4,021 3,945 3,991 3,665 3,802 3,904 3,618 3,265 3,536 3,486 58 Egypt 706 1,151 911 721 702 748 738 549 574 577 59 Morocco 92 194 68 82 68 67 66 72 % 71 60 South Africa 270 202 437 256 324 188 231 201 246 219 61 Zaire 74 67 85 73 92 98 92 87 81 71 62 Oil-exporting countries 1,519 1,014 1,017 1,017 879 1,100 942 897 1,036 1,046 63 Other 1,360 1,316 1,474 1,516 1,737 1,702 1,548 1,459 1,502 1,501 64 Other countries 5,118 4,070 6,165 6,267 6,563 6,108 7,346 7,513 7,261 8,524 65 Australia 4,196 3,327 5,293 5,471 5,700 5,192 6,620 6,721 6,517 7,972 66 All other 922 744 872 796 863 916 726 792 744 551 67 Nonmonetary international and regional organizations 5,807 4,464 3,224 4,002 3,415 3,617 4,240 4,418 4,945 6,281 68 International 4,620 2,830 2,503 2,548 2,456 2,830 2,881 3,084 3,390 4,991 69 Latin American regional 1,033 1,272 589 981 564 613 %1 690 1,201 890 70 Other regional 154 362 133 472 395 175 397 644 353 400 1. Includes the Bank for International Settlements and Eastern European 4. Comprises Algeria, Gabon, Libya, and Nigeria. countries that are not listed in line 23. 5. Excludes "holdings of dollars" of the International Monetary Fund. 2. Comprises Bulgaria, Czechoslovakia, the German Democratic Republic, 6. Asian, African, Middle Eastern, and European regional organizations, Hungary, Poland, and Romania. except the Bank for International Settlements, which is included in "Other 3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and Western Europe." United Arab Emirates (Trucial States). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 International Statistics • February 1990 3.18 BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States1 Payable in U.S. Dollars Millions of dollars, end of period 1989 AArreeaa aanndd ccoouunnttrryy 11998866 11998877 11998888 Apr. May June July Aug. Sept. Oct.' 1 Total 444,745 459,877 491,275 495,060 490,811 490,395 480,634 488,635' 499,122 507,930 2 Foreign countries 441,724 456,472 489,205 493,225 487,029 486,918 476,846 485,511' 496,200 505,250 3 Europe 107,823 102,348 117,048 111,170 112,975 112,240 106,451 107,359' 111,181 109,049 4 Austria 728 793 485 805 764 809 854 549 480 630 5 Belgium-Luxembourg 7,498 9,397 8,518 8,102 8,435 7,780 7,558 7,510 7,404 7,400 6 Denmark 688 717 480 770 470 774 562 768 557 513 7 Finland 987 1,010 1,065 1,214 1,280 1,175 1,433 1,401 1,233 1,707 8 France 11,356 13,548 13,243 16,524 16,092 15,574 15,970 16,415 16,249 15,441 9 Germany 1,816 2,039 2,326 3,529 3,959 3,695 3,460 3,316' 3,463 3,369 10 Greece 648 462 433 561 595 632 602 624 634 650 11 Italy 9,043 7,460 7,936 4,803 5,627 6,813 5,994 5,494 6,043 5,577 12 Netherlands 3,296 2,619 2,547 2,735 3,183 2,025 1,950 1,451' 1,992 1,897 13 Norway 672 934 455 551 567 667 796 665 644 647 14 Portugal 739 477 374 281 371 328 283 264 252 258 15 Spain 1,492 1,853 1,823 2,624 2,209 2,190 2,092 1,738 1,684 1,733 16 Sweden 1,964 2,254 1,977 2,164 2,158 1,946 2,003 2,046 2,286 2,087 17 Switzerland 3,352 2,718 3,895 4,540 3,975 5,485 4,123 4,479 5,018 4,575 18 Turkey 1,543 1,680 1,233 1,005 910 886 891 960 1,028 1,021 19 United Kingdom 58,335 50,823 65,708 56,057 58,076 56,891 53,463 54,811' 57,253 56,442 20 Yugoslavia 1,835 1,700 1,390 1,369 1,366 1,359 1,406 1,346 1,338 1,373 71 619 1,152 1,415 966 1 161 974 1 247 1 249 1 478 22 U.S.S.R 345 389 1,255 1,346 1,155 1,212 1,227 1,456 1,574 1,453 23 Other Eastern Europe 948 852 754 775 820 838 810 819 799 796 24 Canada 21,006 25,368 18,889 19,150 16,072 16,089 14,493 15,073 14,758 13,722 25 Latin America and Caribbean 208,825 214,789 214,233 219,970 217,962 219,267 217,096 215,830' 219,665 219,837 26 Argentina 12,091 11,996 11,826 11,516 11,381 10,840 10,724 10,730' 10,460 10,444 27 Bahamas 59,342 64,587 67,006 75,665 70,552 66,611 70,468 68,113 70,906 71,422 28 Bermuda 418 471 483 361 449 391 463 522 1,104 804 29 Brazil 25,716 25,897 25,735 25,947 25,785 25,675 25,824 25,597 24,999 25,026 30 British West Indies 46,284 50,042 55,790 54,424 57,960 64,870 59,437 61,270' 63,292 62,774 31 Chile 6,558 6,308 5,217 5,224 5,266 4,841 4,770 4,803' 4,707 4,603 32 Colombia 2,821 2,740 2,944 2,661 2,600 22,,558811 2,523 22,,550044'' 22,,447777 22,,880000 33 Cuba 0 1 1 2 1 11 9 11 11 34 Ecuador 2,439 2,286 2,075 2,025 1,944 1,894 1,932 1,918' 1,904 1,864 35 Guatemala4 140 144 198 210 207 200 188 203' 196 188 36 Jamaica 198 188 212 266 265 286 270 272 282 270 37 Mexico 30,698 29,532 24,637 24,077 24,038 23,653 23,356 23,164' 22,813 22,693 38 Netherlands Antilles 1,041 980 1,321 1,009 999 1,183 1,162 1,021' 1,078 1,137 39 Panama 5,436 4,744 2,536 2,433 2,475 2,438 2,320 2,030 1,833 1,831 40 Peru 1,661 1,329 1,013 947 938 874 867 870 823 851 41 Uruguay 940 963 910 876 832 896 854 866 899 903 42 Venezuela 11,108 10,843 10,733 10,659 10,600 10,551 10,269 10,024 10,064 10,270 43 Other Latin America and Caribbean 1,936 1,738 1,597 1,668 1,670 1,482 1,659 1,922 1,827 1,957 44 96,126 106,096 130,906 113344,,443399 113311,,557788 113300,,557788 113300,,223355 113377,,770055'' 114400,,770022 115511,,772244 China Mainland 787 968 762 816 952 920 644 575 590 599 46 Taiwan 2,681 4,592 4,184 3,952 3,715 4,058 3,946 3,356 3,357 2,773 47 Hong Kong 8,307 8,218 10,148 8,293 8,855 8,557 8,153 8,806' 10,338 10,067 48 India 321 510 560 425 411 537 477 547 638 616 49 Indonesia 723 580 674 726 690 671 645 614 615 685 50 Israel 1,634 1,363 1,136 1,052 1,045 1,019 961 902 857 1,185 51 Japan 59,674 68,658 90,162 97,666 93,447 91,086 91,764 96,125' 97,706 108,367 52 Korea 7,182 5,148 5,219 5,198 5,338 5,615 5,774 6,007 5,686 5,748 53 Philippines 2,217 2,071 1,876 1,839 1,810 1,763 1,607 1,543 1,617 1,549 54 Thailand 578 496 849 1,018 975 1,058 1,061 1,130' 1,216 1,058 55 Middle East oil-exporting countries 4,122 4,858 6,213 5,237 5,522 6,550 5,550 8,879 8,618 8,357 56 Other Asia 7,901 8,635 9,122 8,217 8,818 8,745 9,654 9,221' 9,465 10,722 57 Africa 4,650 4,742 5,718 6,087 6,084 6,075 6,066 6,032' 6,028 5,763 58 Egypt 567 521 507 541 541 534 577 494 501 475 59 Morocco 598 542 511 532 538 531 518 535 524 538 60 South Africa 1,550 1,507 1,681 1,742 1,753 1,746 1,702 1,713 1,709 1,679 61 Zaire 28 15 17 19 19 17 17 16 20 15 62 Oil-exporting countries 694 1,003 1,523 1,474 1,504 1,503 1,587 1,608 1,629 1,546 63 Other 1,213 1,153 1,479 1,778 1,729 1,744 1,664 1,666' 1,645 1,510 64 Other countries 3,294 3,129 2,410 2,409 2,359 2,670 2,505 3,512 3,867 5,155 65 Australia 1,949 2,100 1,517 1,505 1,167 1,307 1,518 2,499 2,952 4,301 66 All other 1,345 1,029 894 905 1,192 1,363 987 1,013 915 854 67 Nonmonetary international and regional organizations 33,,002211 3,404 2,071 1,835 3,782 3,477 3,787 3,124 2,922 2,680 1. Reporting banks include all kinds of depository institutions besides commer- 4. Included in "Other Latin America and Caribbean" through March 1978. cial banks, as well as some brokers and dealers. 5. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and 2. Includes the Bank for International Settlements. Beginning April 1978, also United Arab Emirates (Trucial States). includes Eastern European countries not listed in line 23. 6. Comprises Algeria, Gabon, Libya, and Nigeria. 3. Beginning April 1978 comprises Bulgaria, Czechoslovakia, the German 7. Excludes the Bank for International Settlements, which is included in Democratic Republic, Hungary, Poland, and Romania. "Other Western Europe." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A63 3.19 BANKS' OWN AND DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS Reported by Banks in the United States1 Payable in U.S. Dollars Millions of dollars, end of period 1989 TTyyppee ooff ccllaaiimm 11998866 11998877 11998888 Apr. May June July Aug/ Sept/ Oct." 1 Total 444444477777778888888,,,,,,,666666655555550000000 444444499999997777777,,,,,,,666666633333335555555 555555533333338888888,,,,,,,777777799999999999999 555555533333339999999,,,,,,,999999922222227777777 555555555555551111111,,,,,,,222222277777777777777 22 BBaannkkss'' oowwnn ccllaaiimmss oonn ffoorreeiiggnneerrss 444444444444444444444,,,,,,,777777744444445555555 444444455555559999999,,,,,,,888888877777777777777 444444499999991111111,,,,,,,222222277777775555555 495,060 490,811 444444499999990000000,,,,,,,333333399999995555555 480,634 488,435 444444499999999999999,,,,,,,111111122222222222222 507,934 33 FFoorreeiiggnn ppuubblliicc bboorrrroowweerrss 66666664444444,,,,,,,000000099999995555555 66666664444444,,,,,,,666666600000005555555 66666662222222,,,,,,,777777700000000000000 63,248 63,789 66666662222222,,,,,,,666666633333336666666 62,694 62,758 66666662222222,,,,,,,000000055555555555555 63,068 44 OOwwnn ffoorreeiiggnn ooffffiicceess22 222222211111111111111,,,,,,,555555533333333333333 222222222222224444444,,,,,,,777777722222227777777 222222255555557777777,,,,,,,444444400000005555555 259,693 257,271 222222255555558888888,,,,,,,000000022222220000000 248,716 252,058 222222266666665555555,,,,,,,555555566666661111111 270,097 55 UUnnaaffffiilliiaatteedd ffoorreeiiggnn bbaannkkss 111111122222222222222,,,,,,,999999944444446666666 111111122222227777777,,,,,,,666666600000009999999 111111122222229999999,,,,,,,444444488888887777777 131,104 130,488 111111122222228888888,,,,,,,333333399999991111111 128,924 132,478 111111133333331111111,,,,,,,000000077777777777777 130,441 66 DDeeppoossiittss 55555557777777,,,,,,,444444488888884444444 66666660000000,,,,,,,666666688888887777777 66666665555555,,,,,,,888888899999998888888 69,283 67,407 66666668888888,,,,,,,333333300000006666666 68,888 72,576 77777772222222,,,,,,,666666644444442222222 71,977 77 OOtthheerr 66666665555555,,,,,,,444444466666662222222 66666666666666,,,,,,,999999922222222222222 66666663333333,,,,,,,555555588888888888888 61,821 63,081 66666660000000,,,,,,,000000088888885555555 60,036 59,903 55555558888888,,,,,,,444444433333335555555 58,464 88 AAllll ootthheerr ffoorreeiiggnneerrss 44444446666666,,,,,,,111111177777771111111 44444442222222,,,,,,,999999933333336666666 44444441111111,,,,,,,666666688888884444444 41,016 39,263 44444441111111,,,,,,,333333344444449999999 40,300 41,340 44444440000000,,,,,,,444444422222229999999 44,325 99 CCllaaiimmss ooff bbaannkkss'' ddoommeessttiicc ccuussttoommeerrss33...... 33333333333333,,,,,,,999999900000005555555 33333337777777,,,,,,,777777755555558888888 44444447777777,,,,,,,555555522222224444444 44444449999999,,,,,,,555555533333331111111 55555552222222,,,,,,,111111155555554444444 4444444,,,,,,,444444411111113333333 3333333,,,,,,,666666699999992222222 8888888,,,,,,,222222288888889999999 11111111111111,,,,,,,111111155555553333333 11111111111111,,,,,,,222222255555559999999 11 Negotiable and readily transferable 22222224444444,,,,,,,000000044444444444444 22222226666666,,,,,,,6666666%%%%%%% 22222225555555,,,,,,,777777700000000000000 22222222222222,,,,,,,000000011111117777777 22222224444444,,,,,,,222222288888886666666 12 Outstanding collections and other 5555555,,,,,,,444444444444448888888 7777777,,,,,,,333333377777770000000 11111113333333,,,,,,,555555533333335555555 11111116666666,,,,,,,333333366666662222222 11111116666666,,,,,,,666666600000009999999 13 MEMO: Customer liability on 22222225555555,,,,,,,777777700000006666666 22222223333333,,,,,,,111111100000007777777 11111119999999,,,,,,,555555566666668888888 11111116666666,,,,,,,888888822222225555555 11111112222222,,,,,,,888888822222229999999 Dollar deposits in banks abroad, reported by nonbanking business enterprises in the United States5 43,984 40,857 45,391 47,897 49,491 46,687 48,549r 49,634 47,447 n.a. 1. Data for banks' own claims are given on a monthly basis, but the data for parent foreign bank. claims of banks' own domestic customers are available on a quarterly basis only. 3. Assets owned by customers of the reporting bank located in the United Reporting banks include all kinds of depository institutions besides commercial States that represent claims on foreigners held by reporting banks for the account banks, as well as some brokers and dealers. of their domestic customers. 2. U.S. banks: includes amounts due from own foreign branches and foreign 4. Principally negotiable time certificates of deposit and bankers acceptances. subsidiaries consolidated in "Consolidated Report of Condition" filed with bank 5. Includes demand and time deposits and negotiable and nonnegotiable regulatory agencies. Agencies, branches, and majority-owned subsidiaries of certificates of deposit denominated in U.S. dollars issued by banks abroad. For foreign banks: principally amounts due from head office or parent foreign bank, description of changes in data reported by nonbanks, see July 1979 Bulletin, and foreign branches, agencies, or wholly owned subsidiaries of head office or p. 550. 3.20 BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States1 Payable in U.S. Dollars Millions of dollars, end of period 1988 1989 MMaattuurriittyy;; bbyy bboorrrroowweerr aanndd aarreeaa 11998855 11998866 11998877 Dec. Mar. June Sept.p 1 227,903 232,295 235,130 233,280 231,454 231,468 236,346 By borrower ?, Maturity of 1 year or less2 160,824 160,555 163,997 172,730 168,377 167,441 169,240 3 Foreign public borrowers 26,302 24,842 25,889 26,602 24,135 23,688 24,218 4 All other foreigners 134,522 135,714 138,108 146,128 144,242 143,753 145,022 5 Maturity over 1 year2 67,078 71,740 71,133 60,550 63,077 64,028 67,106 6 Foreign public borrowers 34,512 39,103 38,625 35,315 37,922 38,050 41,863 7 All other foreigners 32,567 32,637 32,507 25,235 25,155 25,978 25,242 By area Maturity of 1 year or less 8 Europe 56,585 61,784 59,027 56,031 57,878 58,355 52,384 9 Canada 6,401 5,895 5,680 6,282 5,115 5,693 6,202 10 Latin America and Caribbean 63,328 56,271 56,535 58,004 53,268 50,717 52,198 11 Asia 27,966 29,457 35,919 46,188 45,675 45,309 51,188 17 Africa 3,753 2,882 2,833 3,337 3,610 3,601 3,510 13 All other3 2,791 4,267 4,003 2,888 2,831 3,765 3,757 Maturity of over 1 year2 14 Europe 7,634 6,737 6,6% 4,664 4,507 4,608 8,839 15 Canada 1,805 1,925 2,661 1,922 2,309 2,592 2,440 16 Latin America and Caribbean 50,674 56,719 53,817 47,548 49,790 50,133 48,574 17 Asia 4,502 4,043 3,830 3,613 3,699 3,815 4,197 18 Africa 1,538 1,539 1,747 2,301 2,292 2,408 2,472 19 All other3 926 777 2,381 501 480 472 584 1. Reporting banks include all kinds of depository institutions besides commer- 2. Remaining time to maturity, rial banks, as well as some brokers and dealers. 3. Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 International Statistics • February 1990 3.21 CLAIMS ON FOREIGN COUNTRIES Held by U.S. Offices and Foreign Branches of U.S.-Chartered Banks1-2 Billions of dollars, end of period 1987 1988 1989 AArreeaa oorr ccoouunnttrryy 11998855 11998866 Sept. Dec. Mar. June Sept. Dec. Mar. June Sept." 1 Total 389.1 386.5 387.9 382.4 371.4 352.2 354.3 346.8 345.8 339.4r 345.7 2 G-10 countries and Switzerland 147.0 156.6 154.8 159.7 156.8 151.0 148.9 153.1 145.7 144.7r 146.2 3 Belgium-Luxembourg 9.4 8.4 8.1 10.0 9.1 9.2 9.5 9.0 8.6 7.8 6.9 4 France 12.3 13.6 13.6 13.7 11.8 10.9 10.3 10.5 11.2 10.8 11.1 5 Germany 10.5 11.6 10.5 12.6 11.8 10.6 9.2 10.3 10.2 10.6 10.4 6 Italy 9.7 9.0 6.8 7.5 7.4 6.3 5.6 6.8 5.2 6.1 6.8 7 Netherlands 3.8 4.6 4.8 4.1 3.3 3.2 2.9 2.7 2.8 2.8 2.4 8 Sweden 2.8 2.4 2.6 2.1 2.1 1.9 1.9 1.8 2.3 1.8 2.0 9 Switzerland 4.4 5.8 5.4 5.6 5.1 5.6 5.2 5.4 5.1 5.3 6.1 10 United Kingdom 63.3 70.9 72.0 68.8 71.7 70.4 67.6 66.2 65.4 64.4r 63.8 11 Canada 6.8 5.2 4.6 5.5 4.7 5.3 4.9 5.0 4.0 5.1 5.9 12 Japan 24.1 25.1 26.4 29.8 29.7 27.6 31.8 35.3 30.9 30.1 30.8 13 Other developed countries 30.3 26.1 26.3 26.4 26.4 24.0 23.0 21.0 21.0 21.2 20.7 14 Austria 1.6 1.7 1.8 1.9 1.6 1.6 1.6 1.5 1.4 1.7 11..44 15 Denmark 2.4 1.7 1.6 1.7 1.4 1.1 1.2 1.1 1.1 1.4 11..11 16 Finland 1.6 1.4 1.4 1.2 1.0 1.2 1.3 11..11 1.0 1.0 1.1 17 Greece 2.6 2.3 1.9 2.0 2.3 2.1 2.1 11..88 2.1 22..33 2.3 18 Norway 2.9 2.4 2.0 2.2 1.9 1.9 2.0 1.8 1.6 11..88 1.4 19 Portugal 1.3 .9 .9 .6 .5 .4 .4 .4 .4 .6 .4 20 Spain 5.8 5.8 7.4 8.0 8.9 7.2 6.3 6.2 6.6 6.2 66..99 21 Turkey 2.0 2.0 1.9 2.0 2.0 1.8 1.6 1.5 11..33 11..22 11..11 22 Other Western Europe 2.0 1.5 1.6 1.6 1.9 1.7 1.9 1.3 11..11 11..11 1.0 23 South Africa 3.2 3.0 2.9 2.9 2.8 2.8 2.7 2.4 2.2 2.1 2.1 24 Australia 5.0 3.4 2.9 2.4 2.0 2.2 1.8 1.8 2.4 1.9 2.0 25 OPEC countries3 21.5 19.4 19.2 17.4 17.6 17.0 17.9 16.6 16.2 16.0 16.2 26 Ecuador 2.1 2.2 2.1 1.9 1.9 1.8 1.8 1.7 1.6 1.5 1.5 27 Venezuela 9.0 8.7 8.3 8.1 8.1 8.0 7.9 7.9 7.9 7.5 7.3 28 Indonesia 3.0 2.5 2.0 1.9 1.8 1.8 1.8 1.7 1.7 1.9 2.0 29 Middle East countries 5.4 4.3 5.0 3.6 3.9 3.5 4.6 3.4 3.3 3.4 3.5 30 African countries 2.0 1.8 1.8 1.9 1.9 1.9 1.9 1.9 1.7 1.6 1.9 31 Non-OPEC developing countries 105.0 99.6 98.0 97.8 94.4 91.8 87.2 85.3 85.4 83.1 80.8 Latin America 32 Argentina 8.9 9.5 9.4 9.5 9.6 9.5 9.3 9.0 8.4 7.9 7.6 33 Brazil 25.5 25.3 25.1 24.7 23.8 23.7 22.4 22.4 22.7 22.0 20.8 34 Chile 7.0 7.1 7.1 6.9 6.6 6.4 6.3 5.6 5.7 5.1 4.9 35 Colombia 2.6 2.1 2.0 2.0 2.0 2.2 2.1 2.1 1.9 1.7 1.6 36 Mexico 24.3 24.0 24.7 23.5 22.4 21.1 20.4 18.8 18.0 17.5 17.0 37 Peru 1.8 1.4 1.2 1.1 1.1 .9 .8 .8 .7 .6 .6 38 Other Latin America 3.5 3.1 2.8 2.8 2.8 2.6 2.5 2.6 2.7 2.5 2.9 Asia China 39 Mainland .5 .4 .3 .3 .4 .4 .2 .3 .5 .3 .3 40 Taiwan 4.5 4.9 6.0 8.2 6.1 4.9 3.2 3.7 4.9 5.2 5.0 41 India 1.2 1.2 1.9 1.9 2.1 2.3 2.0 2.1 2.6 22..44 2.7 42 Israel 1.6 1.5 1.3 1.0 1.0 1.0 1.0 1.2 .9 ..88 .7 43 Korea (South) 9.3 6.7 5.0 5.0 5.7 5.9 6.0 6.1 6.1 6.6 6.5 44 Malaysia 2.4 2.1 1.6 1.5 1.5 1.5 1.7 1.6 1.7 1.6 1.7 45 Philippines 5.7 5.4 5.4 5.2 5.1 4.9 4.7 4.5 4.4 4.4 4.0 46 Thailand 1.4 .9 .7 .7 1.0 1.1 11..22 1.1 11..00 11..00 1.3 47 Other Asia 1.0 .7 .7 .7 .7 .8 ..88 .9 ..88 ..88 1.0 Africa 48 Egypt 1.0 .7 .6 .6 .5 .6 .5 .4 .5 .6 .5 49 Morocco .9 .9 .9 .9 .9 .9 .8 .9 .9 .9 .8 50 Zaire .1 .1 .1 .0 .1 .1 .0 ..00 .0 .0 .0 51 Other Africa4 1.9 1.6 1.3 1.3 1.2 1.2 1.2 11..11 1.1 1.1 1.0 52 Eastern Europe 4.4 3.5 3.6 3.2 3.1 3.3 3.1 3.6 3.5 3.4 33..66 53 U.S.S.R .1 .1 .4 .3 .3 .4 .4 .7 .7 .6 ..88 54 Yugoslavia 2.4 2.0 1.9 1.8 1.9 1.9 1.8 1.8 11..77 \\..rr 1.7 55 Other 1.9 1.4 1.2 1.1 1.0 1.0 1.0 1.1 11..11 II..II 1.2 56 Offshore banking centers 64.0 61.5 63.7 54.5 51.5 43.0 47.3 44.3 48.4 43. r 49.4 57 Bahamas 21.5 22.4 25.7 17.3 15.9 8.9 12.9 11.1 1155..88 11.0 11.5 58 Bermuda .7 .6 .6 .6 .8 1.0 .9 .9 11..11 .7 1.3 59 Cayman Islands and other British West Indies 12.2 12.3 11.9 13.5 11.6 10.3 11.9 12.9 11.9 10.8 15.5 60 Netherlands Antilles 2.2 1.8 1.2 1.2 1.3 1.2 1.2 1.0 .9 .9 1.0 61 Panama5 6.0 4.0 3.7 3.7 3.2 3.0 2.7 22..66 22..33 11..99 11..55 62 Lebanon .1 .1 .1 .1 .1 .1 .1 ..11 ..11 ..11 11 63 Hong Kong 11.5 11.1 12.3 11.2 11.3 11.6 10.5 9.6 9.6 10.4 10.7 64 Singapore 9.8 9.2 8.1 7.0 7.4 6.9 7.0 6.1 6.8 7.3 7.8 65 Others6 .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 66 Miscellaneous and unallocated7 16.9 19.8 22.3 23.2 21.5 22.2 26.7 22.6 25.1 27.4 28.5 1. The banking offices covered by these data are the U.S. offices and foreign from $50 million to $150 million equivalent in total assets, the threshold now branches of U.S.-owned banks and of U.S. subsidiaries of foreign-owned banks. applicable to all reporting branches. Offices not covered include (1) U.S. agencies and branches of foreign banks, and 3. This group comprises the Organization of Petroleum Exporting Countries (2) foreign subsidiaries of U.S. banks. To minimize duplication, the data are shown individually, other members of OPEC (Algeria, Gabon, Iran, Iraq, Kuwait, adjusted to exclude the claims on foreign branches held by a U.S. office or another Libya, Nigeria, Qatar, Saudi Arabia, and United Arab Emirates), and Bahrain and foreign branch of the same banking institution. The data in this table combine Oman (not formally members of OPEC). foreign branch claims in table 3.14 (the sum of lines 7 through 10) with the claims 4. Excludes Liberia. of U.S. offices in table 3.18 (excluding those held by agencies and branches of 5. Includes Canal Zone beginning December 1979. foreign banks and those constituting claims on own foreign branches). 6. Foreign branch claims only. 2. Beginning with June 1984 data, reported claims held by foreign branches 7. Includes New Zealand, Liberia, and international and regional organizahave been reduced by an increase in the reporting threshold for "shell" branches tions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A65 3.22 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1988 1989 TTyyppee,, aanndd aarreeaa oorr ccoouunnttrryy 11998855 11998866 11998877 Mar. June Sept. Dec. Mar. June 1 Total 27,825 25,587 28,302 29,792 30,107 32,196 33,417 36,986 36,389' 2 Payable in dollars 24,296 21,749 22,785 24,012 24,805 26,967 27,831 31,195 31,415' 3 Payable in foreign currencies 3,529 3,838 5,517 5,780 5,302 5,229 5.586 5,790 4,975 By type 4 Financial liabilities 13,600 12,133 12,424 14,139 13,894 14,877 14,917 17,164 16,454' 5 Payable in dollars 11,257 9,609 8,643 10,145 10,234 11,283 11,049 13,084 12,692' 6 Payable in foreign currencies 2,343 2,524 3,781 3,994 3,660 3,594 3,868 4,080 3,762 7 Commercial liabilities 14,225 13,454 15,878 15,653 16,213 17,319 18,500 19,822 19,935 8 Trade payables 6,685 6,450 7,305 6,454 6,768 6,480 6,454 6,921 6,228' 9 Advance receipts and other liabilities 7,540 7,004 8,573 9,200 9,446 10,839 12,045 12,901 13,708 10 Payable in dollars 13,039 12,140 14,142 13,867 14,571 15,684 16,782 18,111 18,722 11 Payable in foreign currencies 1,186 1,314 1,737 1,786 1,642 1,635 1,718 1,711 1,213 By area or country Financial liabilities 12 Europe 7,700 7,917 8,320 9,377 9,030 10,295 9,712 12,143 10,849 13 Belgium-Luxembourg 349 270 213 251 282 339 289 320 357 14 France 857 661 382 408 371 372 267 249 274 15 Germany 376 368 551 553 503 488 548 372 470 16 Netherlands 861 542 866 990 862 996 879 933 834 17 Switzerland 610 646 558 691 638 687 1,163 954 936 18 United Kingdom 4,305 5,140 5,557 6,301 6,201 7,243 6,418 9,121 7,799 19 Canada 839 399 360 394 412 431 650 616 544 20 Latin America and Caribbean 3,184 1,944 1,189 1,452 1,448 1,057 1,239 677 1,216' 21 Bahamas 1,123 614 318 289 250 238 184 189 165 22 Bermuda 4 4 0 0 0 0 0 0 0 23 Brazil 29 32 25 0 0 0 0 0 0 24 British West Indies 1,843 1,146 778 1,099 1,154 812 645 471 621 25 Mexico 15 22 13 15 26 2 1 15 17 26 Venezuela 3 0 0 2 0 0 0 0 0 27 Asia 1,815 1,805 2,451 2,836 2,928 3,088 3,312 3,722 3,841 28 Japan 1,198 1,398 2,042 2,375 2,331 2,435 2,563 2,950 3,082 29 Middle East oil-exporting countries 82 8 8 11 11 4 3 1 11 30 Africa 12 1 4 5 2 3 1 5 3 31 Oil-exporting countries3 0 1 1 3 1 1 0 3 2 32 Allother4 50 67 100 75 74 3 2 2 0 Commercial liabilities 33 Europe 4,074 4,446 5,505 5,619 5,722 6,688 7,347 7,772 7,812' 34 Belgium-Luxembourg 62 101 132 154 147 206 170 134 116 35 France 453 352 426 414 408 438 459 574 542' 36 Germany 607 715 908 810 791 1,185 1,699 1,361 1,178' 37 Netherlands 364 424 423 457 508 647 591 668 687 38 Switzerland 379 385 559 527 482 486 417 457 456 39 United Kingdom 976 1,341 1,588 1,722 1,771 2,110 2,063 2,444 2,698' 40 Canada 1,449 1,405 1,301 1,392 1,167 1,109 1,218 1,152 1,119 41 Latin America and Caribbean 1,088 924 864 980 1,035 997 1,118 1,262 1,660 42 Bahamas 12 32 18 19 61 19 49 35 34 43 Bermuda 77 156 168 325 272 222 286 426 388 44 Brazil 58 61 46 59 54 58 95 102 538 45 British West Indies 44 49 19 14 28 30 34 31 42 46 Mexico 430 217 189 164 233 177 179 197 181 47 Venezuela 212 216 162 122 140 204 177 179 184 48 Asia 6,046 5,080 6,565 5,883 6,279 6,632 6,910 7,435 6,938' 49 Japan , 1,799 2,042 2,578 2,508 2,659 2,763 3,091 3,048 2,698' 50 Middle East oil-exporting countries • 2,829 1,679 1,964 1,062 1,320 1,298 1,386 1,526 1,430 51 Africa 587 619 574 575 626 477 578 706 768 52 Oil-exporting countries3 238 197 135 139 115 106 202 272 253 53 All other4 982 980 1,068 1,204 1,383 1,415 1,328 1,496 1,639' 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

A66 International Statistics • February 1990 3.23 CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1988 1989 TTyyppee,, aanndd aarreeaa oorr ccoouunnttrryy 11998855 11998866 11998877 Mar. June Sept. Dec. Mar. June 1 Total 28,876 36,265 30,964 31,089 37,641 38,114 33,412 31,482 34,007r 2 Payable in dollars 26,574 33,867 28,502 29,026 35,613 35,695 31,164 29,254 31,832' 3 Payable in foreign currencies 2,302 2,399 2,462 2,063 2,028 2,419 2,249 2,227 2,175 By type 4 Financial claims 18,891 26,273 20,363 20,326 26,274 27,011 21,482 19,613 22,027' 5 Deposits 15,526 19,916 14,903 12,697 19,492 19,079 15,763 14,733 17,023r 6 Payable in dollars 14,911 19,331 13,775 12,121 18,775 18,145 14,744 13,886 16,143' 7 Payable in foreign currencies 615 585 1,128 576 718 934 1,019 847 879 8 Other financial claims 3,364 6,357 5,460 7,629 6,781 7,932 5,719 4,881 5,004' y Payable in dollars 2,330 5,005 4,646 6,509 5,886 6,990 4,995 4,007 4,187' 10 Payable in foreign currencies 1,035 1,352 814 1,120 895 942 724 874 818 ii Commercial claims 9,986 9,992 10,600 10,763 11,367 11,103 11,930 11,868 11,980' 12 Trade receivables 8,696 8,783 9,535 9,650 10,332 10,109 10,845 10,604 10,791' 13 Advance payments and other claims 1,290 1,209 1,065 1,113 1,036 993 1,085 1,264 1,189' 14 Payable in dollars 9,333 9,530 10,081 10,397 10,952 10,560 11,425 11,361 11,502' 15 Payable in foreign currencies 652 462 519 366 415 542 505 507 478 By area or country Financial claims 16 Europe 6,929 10,744 9,531 9,805 11,512 10,537 9,942 9,119 8,536' 17 Belgium-Luxembourg 10 41 7 15 16 49 10 11 155 18 France 184 138 332 308 181 278 224 230 191 19 Germany 223 116 102 92 168 123 138 180 223' 20 Netherlands 161 151 350 333 335 356 344 383 290 21 Switzerland 74 185 65 54 105 84 215 203 70 22 United Kingdom 6,007 9,855 8,467 8,789 10,430 9,321 8,659 7,801 7,292' 23 Canada 3,260 4,808 2,844 2,669 2,913 3,612 2,338 2,210 2,611 24 Latin America and Caribbean 7,846 9,291 7,012 6,483 10,854 11,814 8,128 7,216 9,298' 25 Bahamas 2,698 2,628 1,994 2,329 4,176 4,064 1,847 2,173 1,875 26 Bermuda 6 6 7 43 87 188 19 25 125 27 Brazil 78 86 63 86 46 44 47 49 78 28 British West Indies 4,571 6,078 4,433 3,503 6,045 7,055 5,729 4,549 6,810' 29 Mexico 180 174 172 154 146 133 151 117 114 30 Venezuela 48 21 19 34 27 27 21 25 31 31 Asia 731 1,317 879 1,294 876 927 799 928 1,219' 32 Japan 475 999 605 1,133 646 737 603 668855 822' 33 Middle East oil-exporting countries2 4 7 8 5 5 5 4 88 7 34 Africa 103 85 65 53 60 95 106 89 8800 35 Oil-exporting countries3 29 28 7 7 9 9 10 8 88 36 All other4 21 28 33 24 58 26 169 51 284 Commercial claims 37 Europe 3,533 3,725 4,180 4,170 4,694 4,295 5,010 4,901 4,889' 38 Belgium-Luxembourg 175 133 178 193 158 171 176 201 200 39 France 426 431 650 552 684 542 671 752 767 40 Germany 346 444 562 637 773 613 611 643 639 41 Netherlands 284 164 133 150 172 145 208 156 191 42 Switzerland 284 217 185 173 262 183 322 246 218 43 United Kingdom 898 999 1,073 1,059 1,095 1,179 1,306 1,282 1,333 44 Canada 1,023 934 936 1,166 937 977 974 1,100 1,168 45 Latin America and Caribbean 1,753 1,857 1,930 1,930 2,067 2,104 2,229 2,100 2,082' 46 Bahamas 13 28 19 14 13 12 36 34 14 47 Bermuda 93 193 170 171 174 161 229 234 236 48 Brazil 206 234 226 209 232 234 298 277 313' 49 British West Indies 6 39 26 24 25 22 21 23 29 30 Mexico 510 412 368 374 411 463 457 476 428 31 Venezuela 157 237 283 274 304 266 226 211 229 52 Asia 2,982 2,755 2,915 2,853 2,994 3,029 2,955 3,090 3,095' 33 Japan 1,016 881 1,158 1,107 1,168 963 934 1,032 982 34 Middle East oil-exporting countries2 638 563 450 408 446 437 441 421 429' 55 Africa 437 500 401 419 425 425 435 386 405' 36 Oil-exporting countries3 130 139 144 126 136 137 122 95 111 57 All other4 257 222 238 225 250 273 328 290 341' 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 A67 3.24 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1989 1989 Transactions, and area or country 1987 1988 J O an ct . . - Apr. May June July Aug. Sept/ Oct." U.S. corporate securities STOCKS 1 Foreign purchases 249,122 181,185 183,611 14,101 17,904 24,311 17,115 22,097 19,588 22,350 2 Foreign sales 232,849 183,185 171,520 14,241 16,846 20,640 15,084 20,939 17,040 20,988 3 Net purchases, or sales (-) 16,272 -2,000 12,090 -141 1,058 3,671 2,031 1,158 2,548 1,363 4 Foreign countries 16,321 -1,825 12,345 -134 1,060 3,689 2,047 1,141 2,600 1,340 5 Europe 1,932 -3,350 2,174 181 -293 418 778 -110 1,459 -107 6 France 905 -281 -148 168 -123 -15 75 -251 -5 -265 7 Germany -70 218 -704 17 -215 -155 -79 -238 -65 -117 8 Netherlands 892 -535 211 -125 -76 131 12 -64 37 226 9 Switzerland -1,123 -2,243 -2,529 -141 -293 -114 -23 -344 64 -244 10 United Kingdom 631 -954 4,056 287 494 329 545 772 893 -34 11 Canada 1,048 1,087 -267 -66 -75 168 8 14 -265 -140 12 Latin America and Caribbean 1,318 1,238 3,604 120 391 168 108 250 601 149 13 Middle East' -1,360 -2,474 3,157 -345 206 1,679 456 553 111 112 14 Other Asia 12,896 1,365 3,196 -28 784 1,201 729 423 633 1,138 15 Japan 11,365 1,922 3,091 -16 763 1,215 626 424 611 975 16 Africa 123 188 104 10 -1 16 2 22 24 -6 17 Other countries 365 121 376 -7 50 40 -34 -11 37 193 18 Nonmonetary international and regional organizations -48 -176 -255 -6 -2 -18 -17 17 -52 23 BONDS2 19 Foreign purchases 105,856 86,363 95,611 9,736 8,329 10,856 10,044 10,943 8,602 10,930 20 Foreign sales 78,312 58,395 69,541 5,270 8,776 9,043 7,526 9,281' 6,796 6,332 21 Net purchases, or sales (-) 27,544 27,968 26,070 4,466 -447 1,813 2,518 1,662' 1,807 4,598 22 Foreign countries 26,804 28,510 25,789 4,465 -570 1,690 2,550 1,686' 1,801 4,540 23 Europe 21,989 17,243 16,332 3,102 -55 2,132 1,976 -58' 1,461 2,426 24 France 194 143 380 27 93 6 121 -35 78 -41 25 Germany 33 1,344 -89 135 -170 -162 -53 -121 -33 113 26 Netherlands 269 1,514 667 51 9 395 -22 96 28 30 27 Switzerland 1,587 505 272 90 -114 -110 81 13 -27 74 28 United Kingdom 19,770 13,088 14,276 2,252 665 1,881 1,937 -259' 1,372 1,950 29 Canada 1,296 711 994 115 59 -188 79 76 155 175 30 Latin America and Caribbean 2,857 1,931 2,650 219 136 271 300 62 233 247 31 Middle East1 -1,314 -178 -356 3 -100 -613 36 43' 20 135 32 Other Asia 2,021 8,900 5,924 990 -615 83 53 1,574 -108 1,553 33 Japan 1,622 7,686 3,719 608 -722 -67 -25 1,167 -179 1,263 34 Africa 16 -8 21 4 0 1 3 5 -3 0 35 Other countries -61 -89 225 33 5 4 103 -17 42 4 36 Nonmonetary international and regional organizations 740 -542 281 1 122 123 -32 -23 6 58 Foreign securities 37 Stocks, net purchases, or sales (-)3 1,081 -1,918 -10,482 -947 -1,322 -2,077 -748 -1,70c -639 -1,361 38 Foreign purchases 95,458 75,211 83,549 6,686 7,748 9,111 7,595 9,488' 8,476 10,043 39 Foreign sales 94,377 77,128 94,031 7,633 9,070 11,188 8,343 11,188' 9,115 11,404 40 Bonds, net purchases, or sales (-) -7,946 -7,221 -6,314 -196 -107 -1,524 -1,414 1,005' -1,842 -890 41 Foreign purchases 199,089 217,932 194,694 15,525 17,242 21,016 20,206 24,092' 18,331 21,260 42 Foreign sales 207,035 225,153 201,008 15,721 17,350 22,540 21,621 23,087' 20,173 22,150 43 Net purchases, or sales (—), of stocks and bonds .... -6,865 -9,138 -16,796 -1,143 -1,430 -3,601 -2,163 -694' -2,481 -2,251 44 Foreign countries -6,757 -9,619 -16,686 -1,350 -1,633 -3,401 -2,315 -880' -1,913 -1,913 45 Europe -12,101 -7,632 -17,249 -1,757 -1,520 -3,876 -2,370 -853' -2,088 -2,535 46 Canada -4,072 -3,735 -3,043 194 -555 -699 -692 -25C -201 655 47 Latin America and Caribbean 828 1,384 836 197 -90 27 -76 313 -61 218 48 9,299 985 3,239 70 700 1,191 805 327' 414 -242 49 Africa 89 -54 25 10 13 3 12 -4 -3 12 50 Other countries -800 -567 -494 -64 -180 -47 7 -414 26 -21 51 Nonmonetary international and regional organizations -108 480 -111 207 203 -200 152 186 -568 -338 1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait, abroad. Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). 3. As a result of the merger of a U.S. and U.K. company in July 1989, the 2. Includes state and local government securities, and securities of U.S. former stockholders of the U.S. company received $5,453 million in shares of the government agencies and corporations. Also includes issues of new debt securi- new combined U.K. company. This transaction is not reflected in the data above. ties sold abroad by U.S. corporations organized to finance direct investments Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 International Statistics • February 1990 3.25 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Transactions Millions of dollars 1989 1989 Country or area 1987 1988 J O an ct . . - Apr. May June July Aug. Sept. Oct.p Transactions, net purchases or sales (-) during period1 1 Estimated total2 25,587 48,868 45,247 29 7,043 -5,202 -1,317 21,979 4,616r -2,150 2 Foreign countries2 30,889 48,206 44,667 291 5,520 -5,319 -773 22,406 5,699' -3,399 3 Europe2 23,716 14,353 29,211 -1,814 44,,449988 -1,305 4,357 15,191 2,494 -2,268 4 Belgium-Luxembourg 653 923 927 -87 8888 13 82 413 216 90 5 Germany 13,330 -5,268 4,521 -693 -179 -1,106 2,622 2,503 510 137 6 Netherlands -913 -356 -804 -643 -638 -674 100 1,304 302 -1,200 7 Sweden 210 -323 1,091 398 -69 647 110 241 -50 140 8 Switzerland2 1,917 -1,074 2,232 440 -83 378 -361 -748 374 -187 9 United Kingdom 3,975 9,674 15,011 -1,298 3,873 -133 1,024 9,863 339 -1,049 10 Other Western Europe 4,563 10,786 6,254 74 1,511 -423 786 1,614 802 -199 11 Eastern Europe -19 -10 -21 -5 -5 -6 -5 0 0 0 12 Canada 4,526 3,761 82 114 157 -478 -533 1,028 -373 150 13 Latin America and Caribbean -2,192 713 8 -133 -179 643 839 -280 23r -1,439 14 Venezuela 150 -109 184 -18 0 1 71 120 29 72 15 Other Latin America and Caribbean -1,142 1,130 -258 -231 -78 -14 104 217 -506' 34 16 Netherlands Antilles -1,200 -308 81 117 -101 656 665 -617 500 -1,545 17 4,488 27,606 15,063 1,743 1,734 -5,577 -4,954 7,118 2,857'' -96 18 Japan 868 21,752 2,344 2,624 1,646 -7,780 -5,360 3,009 2,402' 1,330 19 Africa -56 -13 68 32 -3 66 -5 -48 0 13 20 All other 407 1,786 236 350 -687 1,332 -477 -603 698 240 21 Nonmonetary international and regional organizations -5,302 661 580 -262 1,523 117 -544 -427 -1,083r 1,249 22 International -4,387 1,106 281 -252 1,340 -253 -546 -576 -719r 1,158 23 Latin America regional 3 -31 231 -21 70 191 3 75 -228 160 Memo 24 Foreign countries2 30,889 48,206 44,667 291 5,520 -5,319 -773 22,406 5,699'' -3,399 25 Official institutions 31,064 26,624 23,991 -842 -1,068 449 2,819 9,957 799' -990 26 Other foreign2 -176 21,582 20,676 1,133 6,588 -5,768 -3,592 12,449 4,900'' -2,409 Oil-exporting countries 77 Middle East3 -3,142 1,963 8,813 -471 -299 670 422 3,677 695r -2,178 28 Africa4 16 1 0 0 0 0 0 0 0 0 1. Estimated official and private transactions in marketable U.S. Treasury 3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and securities with an original maturity of more than 1 year. Data are based on United Arab Emirates (Trucial States). monthly transactions reports. Excludes nonmarketable U.S. Treasury bonds and 4. Comprises Algeria, Gabon, Libya, and Nigeria, notes held by official institutions of foreign countries. 2. Includes U.S. Treasury notes publicly issued to private foreign residents denominated in foreign currencies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Interest and Exchange Rates A69 3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Percent per year Rate on Dec. 31, 1989 Rate on Dec. 31, 1989 Rate on Dec. 31, 1989 Country Country Country Month Month Month effective effective effective Austria.. 6.0 June 1989 France 10.25 Oct. 1989 Norway 8.0 June 1983 Belgium . 10.25 Oct. 1989 Germany, Fed. Rep. of. 6.0 Oct. 1989 Switzerland 6.0 Oct. 1989 Brazil ... 49.0 Mar. 1981 Italy 13.5 Mar. 1989 United Kingdom2 Canada.. 12.47 Dec. 1989 Japan 4.25 Dec. 1989 Venezuela 8.0 Oct. 1985 Denmark 10.5 Oct. 1989 Netherlands 7.0 Oct. 1989 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 comdiscounts Treasury bills for 7 to 10 days. mercial banks or brokers. For countries with more than one rate applicable to 2. Minimum lending rate suspended as of Aug. 20, 1981. such 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 year, averages of daily figures 1989 CCoouunnttrryy,, oorr ttyyppee 11998877 11998888 11998899 June July Aug. Sept. Oct. Nov. Dec. 1 Eurodollars 7.07 7.85 9.16 9.28 8.85 8.71 8.85 8.67 8.42 8.39 2 United Kingdom 9.65 10.28 13.87 14.17 13.91 13.86 13.99 15.03 15.07 15.07 3 Canada 8.38 9.63 12.20 12.35 12.24 12.30 12.32 12.29 12.35 12.34 4 Germany 3.97 4.28 7.04 6.92 7.00 6.99 7.37 8.08 8.22 8.06 5 Switzerland 3.67 2.94 6.83 7.09 6.92 7.01 7.42 7.63 7.68 8.14 6 Netherlands 5.24 4.72 7.28 7.11 7.07 7.15 7.53 8.08 8.40 8.47 7 France 8.14 7.80 9.27 8.89 9.05 8.95 9.20 9.89 10.41 10.71 8 Italy 11.15 11.04 12.44 12.35 12.46 12.52 12.40 12.63 12.67 12.83 9 Belgium 7.01 6.69 8.65 8.51 8.46 8.44 8.66 9.51 9.81 10.03 10 Japan 3.87 3.96 4.73 4.46 4.71 4.80 4.88 5.25 5.71 5.80 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

A70 International Statistics • February 1990 3.28 FOREIGN EXCHANGE RATES1 Currency units per dollar 1989 CCoouunnttrryy//ccuurrrreennccyy 11998877 11998888 11998899 July Aug. Sept. Oct. Nov. Dec. 1 Australia/dollar^ 70.137 78.409 79.186 75.658 76.345 77.271 77.421 78.295 78.586 2 Austria/schilling 12.649 12.357 13.236 13.308 13.570 13.733 13.140 12.860 12.241 3 Belgium/franc 37.358 36.785 39.409 39.560 40.310 40.841 39.197 38.403 36.544 4 Canada/dollar 1.3259 1.2306 1.1842 1.1891 1.1758 1.1828 1.1749 1.1697 1.1613 5 China, P.R./yuan 3.7314 3.7314 3.7673 3.7314 3.7314 3.7314 3.7314 3.7314 4.1825 6 Denmark/krone 6.8478 6.7412 7.3210 7.3527 7.4938 7.5872 7.2781 7.1138 6.7610 7 Finland/markka 4.4037 4.1933 4.2963 4.2699 4.3504 4.4219 4.2817 4.2619 4.1231 8 France/franc 6.0122 5.9595 6.3802 6.4105 6.5085 6.5855 6.3339 6.2225 5.9391 9 Germany/deutsche mark 1.7981 1.7570 1.8808 1.8901 1.9268 1.9502 1.8662 1.8300 1.7378 10 Greece/drachma 135.47 142.00 162.60 163.84 166.26 169.03 165.88 164.97 160.32 11 Hong Kong/dollar 7.7986 7.8072 7.8008 7.8040 7.8078 7.8078 7.8081 7.8140 7.8102 12 India/rupee 12.943 13.900 16.213 16.416 16.609 16.745 16.819 16.925 16.932 13 Ireland/punt2 148.79 152.49 141.80 141.26 138.43 136.71 142.50 144.73 151.65 14 Italy/lira 1,297.03 1,302.39 1,372.28 1,367.39 1,384.24 1,404.18 1,369.24 1,343.83 1,291.93 15 Japan/yen 144.60 128.17 138.07 140.42 141.49 145.07 142.21 143.53 143.69 16 Malaysia/ringgit 2.5186 2.6190 2.7079 2.6809 2.6825 2.6980 2.6945 2.7028 2.7032 17 Netherlands/guilder 2.0264 1.9778 2.1219 2.1318 2.1726 2.1992 2.1072 2.0652 1.9619 18 New Zealand/dollar2 59.328 65.560 59.354 57.537 59.217 59.144 55.937 56.301 59.458 19 Norway/krone 6.7409 6.5243 6.9131 6.9478 7.0480 7.1264 6.9502 6.9010 6.7021 20 Portugal/escudo 141.20 144.27 157.53 158.31 161.15 163.36 159.08 157.65 152.34 21 Singapore/dollar 2.1059 2.0133 1.9511 1.9589 1.9604 1.9769 1.9622 1.9588 1.9183 22 South Africa/rand 2.0385 2.2773 2.6215 2.6909 2.7247 2.7882 2.6403 2.6295r 2.5679 23 South Korea/won 825.94 734.52 674.29 669.84 671.13 672.73 673.86 674.94 677.66 24 Spain/peseta 123.54 116.53 118.44 118.73 120.64 122.14 118.77 116.58 112.24 25 Sri Lanka/rupee 29.472 31.820 35.947 34.764 36.276 39.572 40.018 40.017 40.018 26 Sweden/krona 6.3469 6.1370 6.4559 6.4653 6.5481 6.6103 6.4580 6.4306 6.2920 27 Switzerland/franc 1.4918 1.4643 1.6369 1.6281 1.6605 1.6865 1.6302 1.6189 1.5686 28 Taiwan/dollar 31.753 28.636 26.407 25.816 25.685 25.737 25.739 26.029 26.139 29 Thailand/baht 25.775 25.312 25.725 25.771 25.912 26.012 25.868 25.877 25.778 30 United Kingdom/pound2 163.98 178.13 163.82 162.68 159.47 157.15 158.74 157.26 159.65 MEMO 31 United States/dollar3 96.94 92.72 98.60 99.12 100.44 101.87 98.92 97.99 94.88 1. Averages of certified noon buying rates in New York for cable transfers. currencies of 10 industrial countries. The weight for each of the 10 countries is the Data in this table also appear in the Board's G.5 (405) release. For address, see 1972-76 average world trade of that country divided by the average world trade of inside front cover. all 10 countries combined. Series revised as of August 1978 (see Federal Reserve 2. Value in U.S. cents. Bulletin, vol. 64, August 1978, p. 700). 3. Index of weighted-average exchange value of U.S. dollar against the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A71 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 po- "U.S. government securities" may include guaranteed litical subdivisions. issues of U.S. government agencies (the flow of funds figures In some of the tables, details do not add to totals because also include not fully guaranteed issues) as well as direct of rounding. STATISTICAL RELEASES—List Published Semiannually, with Latest Bulletin Reference Issue Page Anticipated schedule of release dates for periodic releases December 1989 A84 SPECIAL TABLES—Published Irregularly, with Latest Bulletin Reference Title and Date Issue Page Assets and liabilities of commercial banks December 31, 1988 August 1989 A78 March 31, 1989 December 1989 All June 30, 1989 January 1990 All September 30, 1989 February 1990 All Terms of lending at commercial banks August 1988 January 1989 All November 1988 April 1989 All February 1989 June 1989 A84 May 1989 November 1989 A73 Assets and liabilities of U.S. branches and agencies of foreign banks September 30, 1988 May 1989 All December 31, 1988 June 1989 A90 March 31, 1989 August 1989 A84 June 30, 1989 November 1989 A78 Pro forma balance sheet and income statements for priced service operations September 30, 1987 February 1988 A80 March 31, 1988 August 1988 A70 March 31, 1989 September 1989 All June 30, 1989 February 1990 A78 Digitized for FSRpeAcSiEaRl tables begin on page A72. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Special Tables • February 1990 4.20 DOMESTIC AND FOREIGN OFFICES, Insured Commercial Bank Assets and Liabilities1-2 Consolidated Report of Condition, September 30, 1989 Millions of dollars Banks with foreign offices3'4 Bank o s f f w ic i e th s o d n o ly m estic IItteemm TToottaall Total Foreign Domestic Over 100 Under 100 1 Total assets6 3,207,227 1,854,651 429,598 1,480,646 966,354 386,222 2 Cash and balances due from depository institutions 328,281 235,754 117,469 118,285 64,473 28,054 Cash items in process of collection, unposted debits, and currency and coin < 85,087 1,867 83,221 29,617 < 4 Cash items in process of collection and unposted debits n.a. n.a. 70,954 21,618 5 Currency and coin n.a. n.a. 12,266 7,999 n.a. 6 Balances due from depository institutions in the United States n.a. 34,391 20,870 13,520 20,787 7 Balances due from banks in foreign countries and foreign central banks 97,887 94,569 3,318 3,171 8 Balances due from Federal Reserve Banks 18,389 163 18,227 10,897 MEMO 9 Noninterest-bearing balances due from commercial banks in the United States (included in balances due from depository institutions in the United States).... n.a. n.a. 8,228 13,193 9,507 10 Total securities, loans and lease financing receivables, net 2,643,869 1,442,982 n.a. n.a. 859,683 341,203 11 Total securities, book value 552,131 239,086 33,076 206,011 200,902 112,142 12 U.S. Treasury securities and U.S. government agency and corporation obligations 358,772 137,509 2,866 134,643 136,655 84,608 N U.S. Treasury securities n.a. 50,289 950 49,340 63,542 n a. 14 U.S. government agency and corporation obligations n.a. 87,220 1,916 85,303 73,113 n a. 15 All holdings of U.S. government-issued or guaranteed certificates of participation in pools of residential mortgages 116,598 67,566 1,717 65,849 32,886 16,147 16 All other n.a. 19,654 200 19,454 40,227 n a. 17 Securities issued by states and political subdivisions in the United States 9 ;,505 42,172 1,772 40,400 37,966 18,367 18 Taxable 2,654 804 124 680 814 1,036 19 Tax-exempt 95,851 41,368 1,648 39,720 37,152 17,331 20 Other domestic debt securities n.a. 28,083 1,777 26,306 21,698 n a. 21 All holdings of private certificates of participation in pools of residential mortgages 3,790 1,689 0 1,689 1,614 488 77 All other 53,716 26,395 1,777 24,617 20,084 7,237 23 Foreign debt securities n a. 27,346 25,878 1,468 592 n a. 24 Equity securities 9,410 3,977 783 3,194 3,991 1,443 25 Marketable 4,766 1,462 230 1,232 2,259 1,045 76 Investments in mutual funds 2,268 444 8 435 866 959 27 Other 2,902 1,156 222 934 1,560 187 7.8 Less: Net unrealized loss 405 137 0 137 167 101 29 Other equity securities 4,644 2,514 553 1,961 1,732 398 30 Federal funds sold and securities purchased under agreements to resell 129,795 65,325 687 64,638 41,397 23,073 31 Federal funds sold 110,523 50,011 n.a. n.a. 37,808 22,704 32 Securities purchased under agreements to resell 19,272 15,314 n.a. n.a. 3,589 369 33 Total loans and lease financing receivables, gross 2,029,919 1,184,601 211,791 972,810 633,756 211 562 34 LESS: Unearned income on loans 15,195 6,789 2,228 4,561 6,226 2,180 35 Total loans and leases (net of unearned income) 2,014,724 1,177,812 209,563 968,250 627,530 209,382 36 LESS: Allowance for loan and lease losses 52,568 39,029 n.a. n.a. 10,145 3.393 37 LESS: Allocated transfer risk reserves 213 213 n.a. n.a. 0 1 38 EQUALS: Total loans and leases, net 1,961,943 1,138,570 n.a. n.a. 617,384 205,988 Total loans, gross, by category 39 Loans secured by real estate 740,727 370,204 22,965 347,239 268,751 101,772 4 4 4 0 1 2 C F 1 a o r 4 n m s f t l a r a m u n c d il t y io n re s a i n d d e n l t a i n a d l p d r e o v p e e l r o t p ie m s ent f T 1 A| 1 1 8 4 9 2 8 , , , 9 2 4 3 3 5 1 8 2 1 3 3 4 8 2 , , , 1 7 4 2 3 1 4 6 0 5 7 9 6 , , , 5 9 0 2 4 5 3 0 4 43 Revolving, open-end loans, extended under lines of credit n.a. n.a. n.a. 26,261 19,398 2,824 4 4 4 5 Mu A l l t l i f o am th i e l r y l ( o 5 a n o s r more) residential properties | 1 11 12 1 2 0 , , 1 9 9 5 1 8 11 6 3 , , 9 0 0 1 3 2 53 1 , , 2 8 3 8 0 2 46 Nonfarm nonresidential properties T T 95,660 86,579 26,373 47 Loans to depository institutions 56,069 50,228 22,529 27,699 5,298 543 48 To commercial banks in the United States n a. 22,244 1,594 20,650 4,641 n a. 49 To other depository institutions in the United States n a. 2,476 274 2,202 595 n a. 50 To banks in foreign countries n.a. 25,507 20,661 4,847 62 n a. 51 Loans to finance agricultural production and other loans to farmers 31,713 5,529 227 5,302 7,347 18,837 5?, Commercial and industrial loans 614,228 431,678 101,549 330,129 140,146 42,405 53 To U.S. addressees (domicile) n.a. 349,526 22,033 327,493 139,796 n a. 54 To non-U.S. addressees (domicile) n.a. 82,151 79,516 2,636 350 n a. 55 Acceptances of other banks 3,505 911 549 362 1,413 1 181 56 U.S. banks n.a. 328 63 264 n.a. n a. 57 Foreign banks n a. 583 486 98 n.a. n a. 58 Loans to individuals for household, family, and other personal expenditures (includes purchased paper) 385,003 162,006 13,289 148,717 180,561 42,436 59 Credit cards and related plans 119,758 47,037 n.a. n.a. 69,966 2,755 60 Other (includes single payment and installment) 265,245 114,969 n.a. n.a. 110,595 39,681 61 Obligations (other than securities) of states and political subdivisions in the U.S. (includes nonrated industrial development obligations) 41,974 25,551 303 25,248 14,610 1,813 67, Taxable 1,346 817 121 696 464 65 63 Tax-exempt 40,628 24,734 182 24,552 14,146 1,748 64 All other loans 120,671 108,443 46,864 61,579 10,245 1,984 65 Loans to foreign governments and official institutions n.a. 30,763 29,413 1,350 230 n a. 66 Other loans n a. 77,680 17,451 60,229 10,014 n a. 67 Loans for purchasing and carrying securities n a. n.a. n.a. 17,786 1,571 n a. 68 All other loans n.a. n.a. n.a. 42,443 8,444 n a. 69 Lease financing receivables 36,029 30,052 3,516 26,536 5,386 591 7 7 0 1 A Pr s e s m et i s s e h s e l a d n d in fi t x ra e d d in a g s s a e c ts c o ( u in n c t l s u ding capitalized leases) 4 3 6 7 , , 7 65 9 2 6 2 36 4 , , 5 9 5 4 1 0 18k,8 31 n 1 . 7 a , . 7 19 15, 9 1 4 7 3 1 6,6 1 8 5 4 8 7 7 2 3 O In t v h e e s r tm re e a n l t e s st in a te u n o c w o n n e s d o lidated subsidiaries and associated companies 1 2 2 , , 9 7 6 1 7 8 6 2 , , 3 1 2 8 1 8 11 n n. . a a . . 3,9 7 1 3 8 0 2,47 4 8 8 74 Customers' liability on acceptances outstanding 28,344 27,958 n.a. n.a. 369 17 7 7 5 6 N In e t t a n d g u i e b l f e r o a m ss e o t w s n foreign offices, Edge and agreement subsidiaries, and IBFs n. 5 a , . 3 20 n. 3 a , . 0 19 I1 n 3 . 8 a , . 3 12 n 2 . , a 0 . 8 5 n.a 2 . 1 6 77 Other assets 101,281 74,938 • n.a. 18,979 7,363 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A73 4.20—Continued Banks with foreign offices 4 Bank o s f f w ic i e th s o d n o l m y estic Total Foreign Domestic Over 100 Under 10( 78 Total liabilities, limited-life preferred stock, and equity capital 3,207,227 1,854,651 n.a. n.a. 966,354 386,222 79 Total liabilities7 3,003,906 1,756,880 429,465 1,383,008 896,082 350,944 80 Limited-life preferred stock 86 0 n. a. n.a. 82 4 8 8 1 2 To I t n al d i d v e id p u o a si l t s s , partnerships, and corporations 2,45k2,9 20 1,33 A 1 ,751 3 1 2 8 3 8 , , 4 4 3 6 8 2 1, 9 0 1 0 8 8 , , 7 3 8 1 1 4 7 71 7 8 9 , , 3 8 0 5 4 6 3 31 4 2 1 , , 6 3 8 1 7 3 83 U.S. government i 2,348 1,363 533 84 States and political subdivisions in the United States 39,150 43,042 23,084 85 Commercial banks in the United States n.a. n.a. 25,377 8,812 1,743 86 Other depository institutions in the United States 4,481 2,254 978 87 Banks in foreign countries 7,575 181 n.a. 88 Foreign governments and official institutions 24,149 22,889 1,260 303 n.a. 89 Certified and official checks 17,731 9,905 562 9,343 5,597 2,229 90 All other8 n.a. n.a. 111,524 n.a. n.a. 58 91 Total transaction accounts 311,049 207,041 87,977 92 Individuals, partnerships, and corporations 261,513 182,083 77,981 93 U.S. government 1,534 1,127 428 94 States and political subdivisions in the United States 8,866 10,669 6,148 95 Commercial banks in the United States n.a. n.a. 18,923 6,185 892 96 Other depository institutions in the United States 3,192 1,238 279 97 Banks in foreign countries 6,873 122 n.a. 98 Foreign governments and official institutions 806 20 n.a. 99 Certified and official checks 9,343 5,597 2,229 100 All other n.a. n.a. 20 101 Demand deposits (included in total transaction accounts) 237,187 130,633 47,446 102 Individuals, partnerships, and corporations 190,117 111,356 41,572 103 U.S. government 1,515 1,098 416 104 States and political subdivisions in the United States 6,421 5,031 2,047 105 Commercial banks in the United States 18,923 6,185 891 106 Other depository institutions in the United States 3,192 1,225 270 107 Banks in foreign countries 6,872 122 n.a. 108 Foreign governments and official institutions 804 20 n.a. 109 Certified and official checks 9,343 5,597 2,229 110 Allother n.a. n.a. 20 111 Total nontransaction accounts 697,265 572,815 253,336 112 Individuals, partnerships, and corporations n.a. n.a. 657,267 536,221 234,706 113 U.S. government 813 236 105 114 States and political subdivisions in the United States 30,284 32,374 16,937 115 Commercial banks in the United States 6,454 2,627 851 116 U.S. branches and agencies of foreign banks 704 164 n.a. 117 Other commercial banks in the United States 5,751 2,463 n.a. 118 Other depository institutions in the United States 1,289 1,016 700 119 Banks in foreign countries 702 59 n.a. 120 Foreign branches of other U.S. banks 28 57 n.a. 121 Other banks in foreign countries 674 3 n.a. 122 Foreign governments and official institutions 454 282 n.a. 123 All other n.a. n.a. 38 124 Federal funds purchased and securities sold under agreements to repurchase. 269,599 205,514 786 204,727 61,005 3,080 125 Federal funds purchased 167,996 135,343 n. a. n.a. 31,236 1,417 126 Securities sold under agreements to repurchase 101,595 70,171 n. a. n.a. 29,769 1,664 127 Demand notes issued to the U.S. Treasury n.a. n a. n. a. 21,698 4,839 650 128 Other borrowed money 122,902 89,647 36,404 53,243 32,079 1,176 129 Banks liability on acceptances executed and outstanding 28,452 28,065 4,992 23,074 369 17 130 Notes and debentures subordinated to deposits 19,295 16,448 n.a. n.a. 2,675 173 131 Net due to own foreign offices, Edge and agreement subsidiaries, and IBFs.. n.a. n a. n a. 17,280 n.a. n.a. 132 All other liabilities 83,551 63,757 n. a. n.a. 15,259 4,535 133 Total equity capital9 203,235 97,771 n.a. n.a. 70,190 35,274 MEMO 134 Holdings of commercial paper included in total loans, gross 993 711 282 1,282 n.a. 135 Total individual retirement accounts (IRA) and Keogh plan accounts 46,985 42,896 17,468 136 Total brokered deposits 43,474 17,995 1,282 137 Total brokered retail deposits 12,609 11,491 1,188 138 Issued in denominations of $100,000 or less 4,234 7,456 1,054 139 Issued in denominations greater than $100,000 and participated out by the broker in shares of $100,000 or less 8,375 4,034 134 Savings deposits 140 Money market deposit accounts (MMDAs) 177,733 119,608 39,393 141 Other savings deposits (excluding MMDAs) 80,158 72,945 29,814 142 Total time deposits of less than $100,000 212,281 256 141,089 143 Time certificates of deposit of $100,000 or more 194,899 119,325 41,652 144 Open-account time deposits of $100,000 or more n.a. n.a. 32,193 4,485 1,388 145 All NOW accounts (including Super NOW) 72,149 74,009 39,053 146 Total time and savings deposits 771,127 649,222 293,867 Quarterly averages 147 Total loans 934,587 616,363 205,868 148 Obligations (other than securities) of states and political subdivisions in the United States 25,598 14,546 n.a. 149 Transaction accounts in domestic offices (NOW accounts, ATS accounts, and telephone and preauthorized transfer accounts) 74,565 75,905 40,333 Nontransaction accounts in domestic offices 150 Money market deposit accounts (MMDAs) 174,976 119,051 39,302 151 Other savings deposits 79,113 72,891 29,710 152 Time certificates of deposit of $100,000 or more 195,420 119,143 40,894 153 All other time deposits 243,262 257,296 141,060 154 Number of banks 12,801 246 n a. n.a. 2,506 10,049 Footnotes appear at the end of table 4.22 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Special Tables • February 1990 4.21 DOMESTIC OFFICES, Insured Commercial Banks with Assets of $100 Million or more or with foreign offices1'2,6 Consolidated Report of Condition, September 30, 1989 Millions of dollars Members NNoonn-- IItteemm mmeemmbbeerrss Total National State 1 Total assets6 2,447,000 1,948,742 1,575,394 373,348 498,258 2 Cash and balances due from depository institutions 182,758 150,481 120,056 30,425 32,277 3 Cash items in process of collection and unposted debits 92,573 82,889 66,954 15,935 9,683 4 Currency and coin 20,265 16,774 14,058 2,716 3,492 5 Balances due from depository institutions in the United States 34,307 22,572 17,391 5,181 11,735 6 Balances due from banks in foreign countries and foreign central banks 6,489 4,853 3,909 943 1,636 7 Balances due from Federal Reserve Banks 29,124 23,393 17,744 5,650 5,731 8 Total securities, loans and lease financing receivables, (net of unearned income) 2,108,727 1,665,997 1,354,474 311,523 442,730 9 Total securities, book value 406,913 307,185 238,884 68,302 99,727 10 U.S. Treasury securities 112,882 80,612 63,056 17,556 32,270 11 U.S. government agency and corporation obligations 158,416 126,061 101,298 24,763 32,355 12 All holdings of U.S. government-issued or guaranteed certificates of participation in pools of residential mortgages 98,735 84,844 69,364 15,480 1133,,889911 N All other 59,682 41,218 31,934 9,283 18,464 14 Securities issued by states and political subdivisions in the United States 78,366 61,861 46,358 15,503 16,505 IS Taxable 1,495 1,128 972 156 366 16 Tax-exempt 76,871 60,732 45,386 15,347 16,139 17 Other domestic debt securities 48,004 33,837 25,002 8,835 14,167 18 All holdings of private certificates of participation in pools of residential mortgages 3,303 2,425 1,728 697 878 19 All other 44,701 31,412 23,274 8,138 13,289 20 2,060 1,536 560 976 524 21 7,185 3,278 2,609 669 3,906 72 Marketable 3,491 753 607 146 2,738 Investments in mutual funds 1,302 494 450 44 808 "M Other ... 2,494 324 210 114 2,170 75 Less: Net unrealized loss 304 64 53 11 240 26 3,693 2,525 2,002 522 1,168 27 Federal funds sold and securities purchased under agreements to resell 106,035 86,730 68,360 18,369 19,306 2.8 Federal funds sold 37,826 24,073 21,052 3,021 13,753 29 Securities purchased under agreements to resell 3,589 2,576 2,142 434 1,013 30 Total loans and lease financing receivables, gross 1,606,566 1,280,218 1,053,742 226,476 326,348 31 LESS: Unearned income on loans 10,787 8,137 6,512 1,624 2,651 32 Total loans and leases (net of unearned income) 1,595,779 1,272,082 1,047,230 224,852 323,697 Total loans, gross, by category 33 Loans secured by real estate 615,990 469,740 402,811 66,928 146,250 34 Construction and land development 128,054 103,270 86,612 16,658 24,784 35 Farmland 6,974 4,715 4,132 583 2,258 36 1 4 family residential properties 280,862 209,079 179,230 29,848 71,783 37 Revolving, open-end and extended under lines of credit 45,659 35,680 30,297 5,383 9,979 38 All other loans 235,202 173,399 148,934 24,465 61,804 39 Multifamily (5 or more) residential properties 17,861 14,159 12,467 1,693 3,701 40 Nonfarm nonresidential properties 182,239 138,516 120,370 18,146 43,724 41 Loans to commercial banks in the United States 25,290 22,026 16,853 5,173 3,265 47. Loans to other depository institutions in the United States 2,797 2,606 2,345 261 191 43 Loans to banks in foreign countries 4,909 4,761 2,427 2,334 147 44 Loans to finance agricultural production and other loans to farmers 12,650 9,792 8,743 1,049 2,858 45 Commercial and industrial loans 470,275 386,605 307,588 79,016 83,670 46 To U.S. addressees (domicile) 467,289 383,905 305,656 78,249 83,384 47 To non-U.S. addressees (domicile) 2,986 2,700 1,933 767 286 48 Acceptances of other banks" 1,775 1,032 876 157 742 49 Of U.S. banks 647 451 376 74 197 50 Of foreign banks 209 173 141 32 36 51 Loans to individuals for household, family, and other personal expenditures (includes purchased paper) 329,278 257,794 218,670 39,124 71,484 52 Credit cards and related plans 70,009 51,550 49,166 2,384 18,458 53 Other (includes single payment and installment) 110,668 67,965 56,696 11,269 42,703 54 Loans to foreign governments and official institutions 1,580 1,498 1,008 490 83 55 Obligations (other than securities) of states and political subdivisions in the United States 39,858 33,532 24,842 8,690 6,326 56 Taxable 1,159 931 696 235 229 57 Tax-exempt 38,699 32,601 24,147 8,454 6,097 58 70,243 63,230 44,755 18,475 7,013 59 Loans for purchasing and carrying securities 19,357 17,546 11,190 6,355 1,811 60 All other loans 50,887 45,684 33,564 12,120 5,202 61 Lease financing receivables 31,921 27,604 22,824 4,779 4,318 62 Customers' liability on acceptances outstanding 22,822 21,667 15,993 5,674 1,155 63 Net due from own foreign offices, Edge and agreement subsidiaries, and IBFs 38,312 33,686 22,619 11,067 4,627 64 132,693 110,597 84,871 25,726 22,096 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A73 4.21—Continued Members NNoonn-- IItteemm TToottaall mmeemmbbeerrss Total National State 65 Total liabilities and equity capital 2,447,000 1,948,742 1,575,394 373,348 498,258 66 Total liabilities4 2,279,089 1,819,278 1,471,686 347,592 459,812 67 Total deposits 1,788,169 1,396,464 1,140,082 256,383 391,705 68 Individuals, partnerships, and corporations 1,637,085 1,274,385 1,045,818 228,567 362,699 69 U.S. government 3,711 3,124 2,767 358 586 70 States and political subdivisions in the United States 82,192 62,529 51,556 10,973 19,663 71 Commercial banks in the United States 34,190 30,553 22,572 7,982 3,636 72 Other depository institutions in the United States 6,735 5,379 4,531 848 1,356 73 Banks in foreign countries 7,756 7,039 3,562 3,477 716 74 Foreign governments and official institutions 1,562 1,450 975 475 112 75 Certified and official checks 14,939 12,004 8,300 3,704 2,935 76 Total transaction accounts 518,090 417,941 333,999 83,942 100,149 77 Individuals, partnerships, and corporations 443,597 353,541 286,955 66,585 90,056 78 U.S. government 2,661 2,173 1,859 314 488 79 States and political subdivisions in the United States 19,535 15,758 12,636 3,122 3,776 80 Commercial banks in the United States 25,108 23,401 17,626 5,775 1,707 81 Other depository institutions in the United States 4,430 3,649 2,898 751 780 82 Banks in foreign countries 6,994 6,622 3,299 3,323 373 83 Foreign governments and official institutions 826 793 424 368 33 84 Certified and official checks 14,939 12,004 8,300 3,704 2,935 85 Demand deposits (included in total transaction accounts) 367,820 301,689 236,062 65,627 66,131 86 Individuals, partnerships, and corporations 301,473 243,588 194,234 49,354 57,885 87 U.S. government 2,614 2,131 1,817 314 483 88 States and political subdivisions in the United States 11,451 9,511 7,471 2,040 1,941 89 Commercial banks in the United States 25,107 23,400 17,626 5,775 1,707 90 Other depository institutions in the United States 4,417 3,641 2,891 751 775 91 Banks in foreign countries 6,994 6,621 3,299 3,323 373 92 Foreign governments and official institutions 824 793 424 368 32 93 Certified and official checks 14,939 12,004 8,300 3,704 2,935 94 Total nontransaction accounts 1,270,080 978,524 806,083 172,441 291,556 95 Individuals, partnerships, and corporations 1,193,488 920,844 758,863 161,982 272,644 96 U.S. government 1,049 951 907 44 99 97 States and political subdivisions in the United States 62,657 46,771 38,920 7,851 15,887 98 Commercial banks in the United States 9,082 7,153 4,946 2,207 1,929 99 U.S. branches and agencies of foreign banks 868 527 305 222 340 100 Other commercial banks in the United States 8,214 6,625 4,640 1,985 1,589 101 Other depository institutions in the United States 2,305 1,730 1,633 97 576 102 Banks in foreign countries 761 418 264 154 344 103 Foreign branches of other U.S. banks 85 70 41 30 14 104 Other banks in foreign countries 677 347 223 124 329 105 Foreign governments and official institutions 736 658 551 107 79 106 Federal funds purchased and securities sold under agreements to repurchase12 265,732 230,387 181,569 48,818 35,345 107 Federal funds purchased 31,236 24,416 21,044 3,373 6,820 108 Securities sold under agreements to repurchase 29,769 15,585 12,877 2,708 14,184 109 Demand notes issued to the U.S. Treasury 26,538 24,270 18,135 6,135 2,267 110 Other borrowed money 85,323 67,636 58,221 9,415 17,687 111 Banks liability on acceptances executed and outstanding 23,443 22,288 16,571 5,717 1,155 112 Notes and debentures subordinated to deposits 2,676 1,759 1,647 112 917 113 Net due to own foreign offices, Edge and agreement subsidiaries, and IBFs 17,280 15,154 13,200 1,954 2,126 114 Remaining liabilities 87,209 76,473 55,461 21,012 10,736 115 Total equity capital9 167,910 129,464 103,708 25,756 38,446 MEMO 116 Holdings of commercial paper included in total loans, gross 1,564 645 591 55 919 117 Total individual retirement accounts (IRA) and Keogh plan accounts 89,880 70,243 58,334 11,909 19,637 118 Total brokered deposits 61,468 46,186 39,921 6,264 15,283 119 Total brokered retail deposits 24,099 15,590 12,640 2,950 8,509 170 Issued in denominations of $100,000 or less 11,690 6,358 5,829 529 5,332 121 Issued in denominations greater than $100,000 and participated out by the broker in shares of $100,000 or less 12,409 9,232 6,811 2,421 3,177 Savings deposits 122 Money market deposit accounts (MMDAs) 297,342 237,662 195,578 42,084 59,680 123 Other savings accounts 153,104 118,079 88,876 29,203 35,025 174 Total time deposits of less than $100,000 468,732 351,413 297,954 53,459 117,319 125 Time certificates of deposit of $100,000 or more 314,224 239,561 203,195 36,366 74,663 126 Open-account time deposits of $100,000 or more 36,678 31,808 20,479 11,330 4,870 127 All NOW accounts (including Super NOW accounts) 146,159 113,310 95,336 17,973 32,849 128 Total time and savings deposits 1,420,349 1,094,775 904,020 190,755 325,574 Quarterly averages P9 1,550,949 1,233,827 1,013,345 220,482 317,122 130 Obligations (other than securities) of states and political subdivisions in the United States 40,143 33,864 24,924 8,941 6,279 131 Transaction accounts (NOW accounts, ATS accounts, and telephone preauthorized transfer accounts) 150,470 116,643 97,312 19,331 33,827 Nontransaction accounts 132 Money market deposit accounts (MMDAs) 294,027 234,604 192,844 41,759 59,423 133 Other savings deposits 152,004 117,076 88,648 28,428 34,928 134 Time certificates of deposits of $100,000 or more 314,563 241,140 204,438 36,702 73,423 135 All other time deposits 500,558 378,766 314,595 64,171 121,792 136 Number of banks 2,752 1,557 1,306 251 1,195 Footnotes appear at the end of table 4.22 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Special Tables • February 1990 4.22 DOMESTIC OFFICES, Insured Commercial Bank Assets and Liabilities12-6 Consolidated Report of Condition, September 30, 1989 Millions of dollars Members NNoonn-- Item mmeemmbbeerrss Total National State 1 Total assets6 22,,883333,,222222 2,103,982 1,699,728 404,254 729,240 2 Cash and balances due from depository institutions 210,812 162,123 129,564 32,559 48,688 3 Currency and coin 23,618 18,137 15,158 2,979 5,481 4 Noninterest-bearing balances due from commercial banks . 30,928 17,599 14,110 3,490 13,329 5 Other 156,266 126,387 100,297 26,090 29,879 6 Total securities, loans, and lease financing receivables (net of unearned income) 2,453,324 1,804,129 1,464,841 339,288 649,196 7 Total securities, book value 519,055 350,981 274,686 76,295 168,074 8 U.S. Treasury securities and U.S. government agency and corporation obligations .. 355,906 239,724 191,370 48,354 116,181 9 Securities issued by states and political subdivisions in the United States 96,733 68,763 51,932 16,831 27,970 10 Taxable 2,530 1,502 1,273 229 1,028 11 Tax-exempt 94,202 67,260 50,658 16,602 26,942 12 Other debt securities 57,789 38,533 28,213 10,320 19,256 13 All holdings of private certificates of participation in pools of residential mortgages 3,829 2,661 1,880 781 1,168 14 All other 51,941 34,336 25,773 8,563 17,605 15 Equity securities 8,628 3,961 3,171 789 4,667 16 Marketable 4,536 1,136 927 209 3,400 17 Investments in mutual funds 2,261 876 772 104 1,384 18 Other 2,681 361 240 121 2,319 19 Less: Net unrealized loss 405 101 85 17 304 20 Other equity securities 4,091 2,825 2,244 581 1,267 21 Federal funds sold and securities purchased under agreements to resell1 129,108 97,314 76,849 20,465 31,794 22 Federal funds sold 60,530 34,452 29,392 5,060 26,078 23 Securities purchased under agreements to resell 3,958 2,781 2,291 490 1,177 24 Total loans and lease financing receivables, gross 1,818,129 1,364,910 1,120,523 244,387 453,219 25 LESS: Unearned income on loans 12,967 9,076 7,217 1,859 3,892 26 Total loans and leases (net of unearned income) 1,805,161 1,355,834 1,113,306 242,528 449,327 Total loans, gross, by category 27 Loans secured by real estate 717,761 510,111 434,623 75,488 207,650 28 Construction and land development 135,994 106,585 89,211 17,374 29,409 Farmland 16,497 7,863 6,672 1,191 8,634 1-4 family residential properties 336,916 231,566 196,758 34,808 105,350 Revolving, open-end loans, and extended under lines of credit. 48,483 36,924 31,241 5,683 11,559 All other loans 288,433 194,642 165,517 29,125 93,791 Multifamily (5 or more) residential properties 19,742 14,846 13,014 1,832 4,897 Nonfarm nonresidential properties 208,612 149,252 128,967 20,284 59,361 35 Loans to depository institutions 33,539 29,674 21,845 7,829 3,865 36 Loans to finance agricultural production and other loans to farmers 31,486 16,330 13,974 2,356 15,156 37 Commercial and industrial loans 512,680 404,616 321,513 83,103 108,064 38 Acceptances of other banks 2,956 1,527 1,320 208 1,429 39 Loans to individuals for household, family, and other personal expenditures (includes purchased paper) 371,714 275,122 232,494 42,627 96,593 40 Credit cards and related plans 72,764 52,741 50,247 2,495 20,022 41 Other (includes single payment installment) 150,349 84,102 69,440 14,661 66,247 42 Obligations (other than securities) of states and political subdivisions in the United States 41,671 34,191 25,397 8,794 7,480 43 Taxable 1,225 955 716 238 270 44 Tax-exempt 40,446 33,236 24,681 8,556 7,210 45 All other loans 73,808 65,549 46,384 19,165 8,259 46 Lease financing receivables 32,513 27,790 22,972 4,817 4,723 47 Customers' liability on acceptances outstanding 22,839 21,678 16,003 5,675 1,161 48 Net due from own foreign offices, Edge and agreement subsidiaries, and IBFs 38,312 33,686 22,619 11,067 4,627 49 Remaining assets 146,247 116,052 89,319 26,732 30,195 50 Total liabilities and equity capital. 2,833,222 2,103,982 1,699,728 404,254 729,240 51 Total liabilities4 2,630,034 1,960,737 1,585,142 375,595 669,297 52 Total deposits 2,129,482 1,533,935 1,250,411 283,523 595,547 53 Individuals, partnerships, and corporations 1,949,771 1,400,506 1,146,916 253,589 549,265 54 U.S. government 4,244 3,335 2,943 392 909 55 States and political subdivisions in the United States 105,277 71,169 58,653 12,516 34,108 56 Commercial banks in the United States 35,933 31,618 23,363 8,256 4,315 57 Other depository institutions in the United States ... 7,713 5,767 4,853 914 1,946 58 Certified and official checks 17,169 13,023 9,121 3,902 4,145 59 All other 9,376 8,516 4,562 3,954 860 60 Total transaction accounts 606,067 454,517 363,674 90,843 151,550 61 Individuals, partnerships, and corporations 521,578 385,823 313,189 72,634 135,755 62 U.S. government 3,089 2,347 2,003 344 742 63 States and political subdivisions in the United States 25,683 18,028 14,509 3,519 7,654 64 Commercial banks in the United States 26,000 24,088 18,107 5,981 1,912 65 Other depository institutions in the United States ... 4,709 3,791 3,020 770 918 66 Certified and official checks 17,169 13,023 9,121 3,902 4,145 67 All other 7,840 7,418 3,725 3,693 423 68 Demand deposits (included in total transaction accounts). 415,266 322,076 252,486 69,590 93,190 69 Individuals, partnerships, and corporations 343,046 261,195 208,460 52,734 81,851 70 U.S. government 3,030 2,302 1,958 343 728 71 States and political subdivisions in the United States .. 13,498 10,272 8,104 2,168 3,226 72 Commercial banks in the United States 25,999 24,087 18,107 5,981 1,912 73 Other depository institutions in the United States 4,687 3,780 3,010 769 907 74 Certified and official checks 17,169 13,023 9,121 3,902 4,145 75 All other 7,838 7,417 3,724 3,693 421 76 Total nontransaction accounts 1,523,415 1,079,418 886,737 192,680 443,998 77 Individuals, partnerships, and corporations 1,428,194 1,014,683 833,727 180,956 413,510 78 U.S. government 1,155 988 940 48 166 79 States and political subdivisions in the United States 79,594 53,141 44,144 8,997 26,453 80 Commercial banks in the United States 9,933 7,531 5,256 2,275 2,402 81 Other depository institutions in the United States ... 3,005 1,977 1,833 144 1,028 82 All other 1,535 1,098 837 261 437 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks All 4.22—Continued Members IItteemm TToottaall NNoonn-mmeemmbbeerrss Total National State 83 Federal funds purchased and securities sold under agreements to repurchase12 268,812 232,011 182,758 49,253 36,801 84 Federal funds purchased 32,653 25,264 21,629 3,635 7,388 85 Securities sold under agreements to repurchase 31,432 16,361 13,480 2,880 15,072 86 Demand notes issued to the U.S. Treasury 27,188 24,555 18,363 6,192 2,633 87 Other borrowed money 86,498 67,912 58,468 9,444 18,586 88 Banks liability on acceptances executed and outstanding 23,460 22,299 16,581 5,719 1,161 89 Notes and debentures subordinated to deposits 2,849 1,807 1,688 119 1,041 90 Net due to own foreign offices, Edge and agreement subsidiaries, and IBFs 17,280 15,154 13,200 1,954 2,126 91 Remaining liabilities 91,744 78,218 56,872 21,346 13,527 92 Total equity capital9 203,188 143,245 114,586 28,659 59,943 MEMO 93 Assets held in trading accounts13 18,821 18,009 12,813 5,1% 812 94 U.S. Treasury securities 8,891 8,682 5,770 2,912 209 95 U.S. government agency corporation obligations 2,212 2,185 1,860 324 28 96 Securities issued by states and political subdivisions in the United States 963 953 766 187 10 97 Other bonds, notes, and debentures 166 131 129 2 35 98 Certificates of deposit 502 502 309 193 0 99 Commercial paper 44 44 44 0 0 100 Bankers acceptances 1,697 1,662 970 691 36 101 Other 3,618 3,543 2,675 868 75 102 Total individual retirement accounts (IRA) and Keogh plan accounts 107,348 76,965 63,757 13,208 30,383 103 Total brokered deposits 62,750 46,553 40,242 6,312 16,197 104 Total brokered retail deposits 25,287 15,931 12,935 2,9% 9,356 105 Issued in denominations of $100,000 or less 1122,,774444 6,692 66,,111188 574 66,,005522 106 Issued in denominations greater than $100,000 and participated out by the broker in shares of $100,000 or less 12,543 9,239 6,817 2,422 3,304 Savings deposits 107 Money market deposit accounts (MMDAs) 336,734 254,659 209,287 45,372 82,075 108 Other savings deposits 182,918 130,090 98,385 31,705 52,827 109 Total time deposits of less than $100,000 609,821 405,015 340,711 64,304 204,806 110 Time certificates of deposit of $100,000 or more 355,875 257,360 217,479 39,881 98,516 Ill Open-account time deposits of $100,000 or more 38,067 32,293 20,874 11,419 5,774 112 All NOW accounts (including Super NOW) 185,211 129,022 108,218 20,804 56,189 113 Total time and savings deposits 1,714,216 1,211,859 997,926 213,933 502,357 Quarterly averages 114 Total loans 1,756,817 1,316,476 1,078,683 237,794 440,341 115 Transaction accounts (NOW accounts, ATS accounts, and telephone and preauthorized transfer accounts) 190,803 132,765 110,502 22,263 58,038 Nontransaction accounts 116 Money market deposit accounts (MMDAs) 333,329 251,584 206,564 45,020 81,745 117 Other savings deposits 181,714 129,051 98,127 30,924 52,662 118 Time certificates of deposit of $100,000 or more 355,457 258,670 218,544 40,125 %,787 119 All other time deposits 641,618 432,073 357,139 74,934 209,545 120 Number of banks 12,801 5,255 4,213 1,042 7,546 1. Effective Mar. 31, 1984, the report of condition was substantially revised for refers to those respondents whose assets, as of June 30 of the previous calendar commercial banks. Some of the changes are as follows: (1) Previously, banks with year, were less than $100 million. (These respondents filed the FFIEC 034 call international banking facilities (IBFs) that had no other foreign offices were report.) considered domestic reporters. Beginning with the Mar. 31, 1984 call report these 6. Since the domestic portion of allowances for loan and lease losses and banks are considered foreign and domestic reporters and must file the foreign and allocated transfer risk reserve are not reported for banks with foreign offices, the domestic report of condition; (2) banks with assets greater than $1 billion have components of total assets (domestic) will not add to the actual total (domestic). additional items reported; (3) the domestic office detail for banks with foreign 7. Since the foreign portion of demand notes issued to the U.S. Treasury is not offices has been reduced considerably; and (4) banks with assets under $25 million reported for banks with foreign offices, the components of total liabilities (foreign) have been excused from reporting certain detail items. will not add to the actual total (foreign). 2. The "n.a." for some of the items is used to indicate the lesser detail available 8. The definition of 'all other' varies by report form and therefore by column in from banks without foreign offices, the inapplicability of certain items to banks this table. See the instructions for more detail. that have only domestic offices and/or the absence of detail on a fully consolidated 9. Equity capital is not allocated between the domestic and foreign offices of basis for banks with foreign offices. banks with foreign offices. 3. All transactions between domestic and foreign offices of a bank are reported 10. Only the domestic portion of federal funds sold and securities purchased in "net due from" and "net due to." All other lines represent transactions with under agreements to resell are reported here, therefore, the components will not parties other than the domestic and foreign offices of each bank. Since these add to totals for this item. intraoffice transactions are nullified by consolidation, total assets and total 11. "Acceptances of other banks" is not reported by domestic respondents less liabilities for the entire bank may not equal the sum of assets and liabilities than $300 million in total assets, therefore the components will not add to totals for respectively, of the domestic and foreign offices. this item. 4. Foreign offices include branches in foreign countries, Puerto Rico, and in 12. Only the domestic portion of federal funds purchased and securities sold U.S. territories and possessions; subsidiaries in foreign countries; all offices of are reported here, therefore the components will not add to totals for this item. Edge act and agreement corporations wherever located and IBFs. 13. Components of assets held in trading accounts are only reported for banks 5. The 'over 100' column refers to those respondents whose assets, as of June with total assets of $1 billion or more; therefore the components will not add to the 30 of the previous calendar year, were equal to or exceeded $100 million. (These totals for this item. respondents file the FFIEC 032 or FFIEC 033 call report.) The 'under 100' column Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Special Tables • February 1990 4.31 Pro forma balance sheet for priced services of the Federal Reserve System1 Millions of dollars Item June 30, 1989 June 30, 1988 Short-term assets2 Imputed reserve requirement on clearing balances 217.9 218.4 Investment in marketable securities 1,598.1 1,601.6 Receivables 62.4 57.2 Materials and supplies 6.6 5.9 Prepaid expenses 11.0 11.3 Items in process of collection 2,969.6 2,051.8 Total short-term assets 4,865.6 3,946.2 Long-term assets3 Premises 282.4 263.1 Furniture and equipment 122.0 121.9 Leases and leasehold improvements 7.7 5.8 Prepaid pension costs 44.7 33.8 Total long-term assets 456.9 424.6 Total assets 5,322.4 4,370.8 Short-term liabilities Clearing balances and balances arising from early credit of uncollected items 1,993.7 2,090.7 Deferred available items 2,791.9 1,781.0 Short-term debt 80.0 74.4 Total short-term liabilities 4,865.6 3,946.2 Long-term liabilities Obligations under capital leases 1.2 1.2 Long-term debt 130.7 123.9 Total long-term liabilities 131.9 125.1 Total liabilities 4,997.5 4,071.3 Equity 325.0 299.5 Total liabilities and equity4 5,322.4 4,370.8 1. Details may not sum to totals because of rounding. collected for government agencies; and items associated with providing fixed 2. The imputed reserve requirement on clearing balances and investment in availability or credit prior to receipt and processing of items. The cost base for marketable securities reflect the Federal Reserve's treatment of clearing balances providing services that must be recovered under the Monetary Control Act maintained on deposit with Reserve Banks by depository institutions. For includes the cost of float (the difference between the value of gross CIPC and the presentation of the balance sheet and the income statement, clearing balances are value of deferred availability items) incurred by the Federal Reserve during the reported in a manner comparable to the way correspondent banks report period, valued at the federal funds rate. The amount of float, or net CIPC, compensating balances held with them by respondent institutions. That is, represents the portion of gross CIPC that involves a financing cost. respondent balances held with a correspondent are subject to a reserve require- 3. Long-term assets on the balance sheet have been allocated to priced services ment established by the Federal Reserve. This reserve requirement must be with the direct determination method, which uses the Federal Reserve's Planning satisfied with either vault cash or with nonearning balances maintained at a and Control System (PACS) to ascertain directly the value of assets used solely in Reserve Bank. Following this model, clearing balances maintained with Reserve priced services operations and to apportion the value of jointly used assets Banks for priced service purposes are subjected to imputed reserve requirements. between priced services and nonpriced services. Also, long-term assets include an Therefore, a portion of the clearing balances held with the Federal Reserve is estimate of the assets of the Board of Governors directly involved in the classified on the asset side of the balance sheet as required reserves and is development of priced services. reflected in a manner similar to vault cash and due from bank balances normally Long-term assets include amounts for capital leases and leasehold improveshown on a correspondent bank's balance sheet. The remainder of clearing ments and for prepaid pension costs associated with priced services. Effective balances is assumed to be available for investment. For these purposes, the January 1, 1987, the Federal Reserve Banks implemented Financial Accounting Federal Reserve assumes that all such balances are invested in three-month Standards Board Statement No. 87, Employer's Accounting for Pensions. Treasury bills. 4. A matched-book capital structure has been used for those assets that are not The account "items in the process of collection" (CIPC) represents the gross "self-financing" in determining liability and equity amounts. Short-term assets amount of Federal Reserve CIPC as of the balance sheet date, stated on a basis are financed with short-term debt. Long-term assets are financed with long-term comparable with a commercial bank. Adjustments have been made for intra- debt and equity in a proportion equal to the ratio of long-term debt to equity for System items that would otherwise be double-counted on a consolidated Federal the bank holding companies used in the model for the private sector adjustment Reserve balance sheet; items associated with nonpriced items, such as items factor (PSAF). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A79 4.32 Pro forma income statement for priced services of the Federal Reserve System1 Millions of dollars Quarter ending June 30 IItteemm 1989 1988 Income services provided to depository institutions2 180.7 165.2 Production expenses3 141.7 122.9 Income from operations 39.0 42.3 Imputed costs4 Interest on float 13.9 5.2 Interest on debt 8.4 8.1 Sales taxes 1.8 2.1 FDIC insurance .4 24.6 .4 15.8 Income from operations after imputed costs 14.5 26.5 Other income and expenses5 Investment income 42.4 30.5 Earnings credits 40.0 2.5 28.9 1.7 Income before income taxes 16.9 28.1 Imputed income taxes6 5.7 9.1 Net income 11.2 19.0 MEMO Targeted return on equity6 8.2 8.2 Six months ending June 30 1989 1988 Income services provided to depository institutions2 357.8 328.4 Production expenses3 291.1 253.4 Income from operations 66.7 75.0 Imputed costs4 Interest on float 25.3 16.4 Interest on debt 16.8 16.2 Sales taxes 3.7 4.2 FDIC insurance ,8 46.7 .8 37.6 Income from operations after imputed costs 20.0 37.4 Other income and expenses5 Investment income 80.7 59.6 Earnings credits 74.3 6.3 56.2 3.4 Income before income taxes 26.3 40.8 Imputed income taxes6 1US 14.5 Net income 14.5 26.3 MEMO Targeted return on equity6 16.4 16.4 1. The income statement reflects income and expenses for priced services. through adjustments to the institution's reserve or clearing balance or by valuing Included in these amounts are the imputed costs of float, imputed financing costs, the float at the federal funds rate and billing the institution directly. and the income related to clearing balances. Float recovered through per-item fees is valued at the federal funds rate and has Details may not add to totals because of rounding. been added to the cost base subject to recovery in the second quarter of 1989 2. Income represents charges to depository institutions for priced services. Total float 876.5 This income is realized through one of two methods: direct charges to an Unrecovered float 25.4 institution's account or charges against accumulated earnings credits. Income Float subject to recovery 851.1 includes charges for per-item fees, fixed fees, package fees, explicitly priced float, Sources of float recovery account maintenance fees, shipping and insurance fees, and surcharges. Income on clearing balances 102.1 3. Production expenses include direct, indirect, and other general administra- As of adjustments 301.1 tive expenses of the Federal Reserve Banks for providing priced services. Also Direct charges 142.9 included are the expenses of staff members of the Board of Governors working Per-item fees 305.0 directly on the development of priced services, which amounted to $0.4 million in Also included in imputed costs is the interest on debt assumed necessary to the second quarter and $0.9 million in the first six months for both 1989 and 1988. finance priced-service assets and the sales taxes and FDIC insurance assessment 4. Imputed float costs represent the value of float to be recovered, either that the Federal Reserve would have paid had it been a private-sector firm. explicitly or through per-item fees, during the period. Float costs include those for 5. Other income and expenses consist of income on clearing balances and the checks, book-entry securities, noncash collection, ACH, and wire transfers. cost of earnings credits granted to depository institutions on their clearing The following table depicts the daily average recovery of float by the Federal balances. Income on clearing balances represents the average coupon-equivalent Reserve Banks for the second quarter of 1989. In the table, unrecovered float yield on three-month Treasury bills applied to the total clearing balance mainincludes that generated by services to government agencies or by other central tained, adjusted for the effect of reserve requirements on clearing balances. bank services. Expenses for earnings credits are derived by applying the average federal funds Float recovered through income on clearing balances represents increased rate to the required portion of the clearing balances, adjusted for the net effect of investable clearing balances as a result of reducing imputed reserve requirements reserve requirements on clearing balances. through the use of a deduction for float for cash items in process of collection 6. Imputed income taxes are calculated at the effective tax rate derived from a when calculating the reserve requirement. This income then reduces the float model consisting of the 25 largest bank holding companies. The targeted return on required to be recovered through other means. equity represents the after-tax rate of return on equity that the Federal Reserve As-of adjustments and direct charges refer to midweek closing float and would have earned had it been a private business firm, based on the bank holding interterritory check float, which may be recovered from depositing institutions company model. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A80 Federal Reserve Board of Governors ALAN GREENSPAN, Chairman MARTHA R. SEGER MANUEL H. JOHNSON, Vice Chairman WAYNE D. ANGELL OFFICE OF BOARD MEMBERS DIVISION OF INTERNATIONAL FINANCE JOSEPH R. COYNE, Assistant to the Board EDWIN M. TRUMAN, Staff Director DONALD J. WINN, Assistant to the Board LARRY J. PROMISEL, Senior Associate Director BOB STAHLY MOORE, Special Assistant to the Board CHARLES J. SIEGMAN, Senior Associate Director DAVID H. HOWARD, Deputy Associate Director ROBERT F. GEMMILL, Staff Adviser DONALD B. ADAMS, Assistant Director LEGAL DIVISION PETER HOOPER III, Assistant Director J R . IC V H IR A G R I D L M M . A A TT S I H N T G O L N Y , , A J s R s . o , c G ia e te n er G al e n C er o a u l n s C el o unsel R K A A L R P E H N W H . . J S O M H I N TH S , O N JR , . , A A s s s s is is ta ta n n t t D D ir ir e e c c to to r r OLIVER IRELAND, Associate General Counsel RICKI R. TIGERT, Associate General Counsel DIVISION OF RESEARCH AND STATISTICS SCOTT G. ALVAREZ, Assistant General Counsel MARYELLEN A. BROWN, Assistant to the General Counsel MICHAEL J. PRELL, Director EDWARD C. ETTIN, Deputy Director THOMAS D. SIMPSON, Associate Director OFFICE OF THE SECRETARY LAWRENCE SLIFMAN, Associate Director DAVID J. STOCKTON, Associate Director WILLIAM W. WILES, Secretary MARTHA BETHEA, Deputy Associate Director JENNIFER J. JOHNSON, Associate Secretary PETER A. TINSLEY, Deputy Associate Director BARBARA R. LOWREY, Associate Secretary MYRON L. KWAST, Assistant Director PATRICK M. PARKINSON, Assistant Director MARTHA S. SCANLON, Assistant Director JOYCE K. ZICKLER, Assistant Director DIVISION OF CONSUMER LEVON H. GARABEDIAN, Assistant Director AND COMMUNITY AFFAIRS (Administration) GRIFFITH L. GARWOOD, Director GLENN E. LONEY, Assistant Director DIVISION OF MONETARY AFFAIRS ELLEN MALAND, Assistant Director DOLORES S. SMITH, Assistant Director DONALD L. KOHN, Director DAVID E. LINDSEY, Deputy Director BRIAN F. MADIGAN, Assistant Director DIVISION OF BANKING RICHARD D. PORTER, Assistant Director SUPERVISION AND REGULATION NORMAND R.V. BERNARD, Special Assistant to the Board WILLIAM TAYLOR, Staff Director DON E. KLINE, Associate Director OFFICE OF THE INSPECTOR GENERAL FREDERICK M. STRUBLE, Associate Director WILLIAM A. RYBACK, Deputy Associate Director BRENT L. BOWEN, Inspector General STEPHEN C. SCHEMERING, Deputy Associate Director BARRY R. SNYDER, Assistant Inspector General RICHARD SPILLENKOTHEN, Deputy Associate Director HERBERT A. BIERN, Assistant Director JOE M. CLEAVER, Assistant Director ROGER T. COLE, Assistant Director JAMES I. GARNER, Assistant Director JAMES D. GOETZINGER, Assistant Director MICHAEL G. MARTINSON, Assistant Director ROBERT S. PLOTKIN, 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

A81 and Official Staff EDWARD W. KELLEY, JR. JOHN P. LA WARE 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 WILLIAM SCHNEIDER, Special Assignment: Project Director, National Information Center DIVISION OF FEDERAL RESERVE PORTIA W. THOMPSON, Equal Employment Opportunity BANK OPERATIONS Programs Officer CLYDE H. FARNSWORTH, JR., Director DIVISION OF HUMAN RESOURCES DAVID L. ROBINSON, Associate Director MANAGEMENT C. WILLIAM SCHLEICHER, JR., Associate Director BRUCE J. SUMMERS, Associate Director DAVID L. SHANNON, Director CHARLES W. BENNETT, Assistant Director JOHN R. WEIS, Associate Director JACK DENNIS, JR., Assistant Director ANTHONY V. DIGIOIA, Assistant Director EARL G. HAMILTON, Assistant Director JOSEPH H. HAYES, JR., Assistant Director JOHN H. PARRISH, Assistant Director FRED HOROWITZ, Assistant Director LOUISE L. ROSEMAN, Assistant Director FLORENCE M. YOUNG, Assistant Director OFFICE OF THE CONTROLLER GEORGE E. LIVINGSTON, Controller STEPHEN J. CLARK, Assistant Controller (Programs and Budgets) DARRELL R. PAULEY, Assistant Controller (Finance) DIVISION OF SUPPORT SERVICES ROBERT E. FRAZIER, Director GEORGE M. LOPEZ, Assistant Director DAVID L. WILLIAMS, Assistant Director OFFICE OF THE EXECUTIVE DIRECTOR FOR INFORMATION RESOURCES MANAGEMENT ALLEN E. BEUTEL, Executive Director STEPHEN R. MALPHRUS, Deputy Executive Director DIVISION OF HARDWARE AND SOFTWARE SYSTEMS BRUCE M. BEARDSLEY, Director DAY W. RADEBAUGH, JR., Assistant Director ELIZABETH B. RIGGS, Assistant Director DIVISION OF APPLICATIONS DEVELOPMENT AND STATISTICAL SERVICES WILLIAM R. JONES, Director RICHARD C. STEVENS, Assistant Director ROBERT J. ZEMEL, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

82 Federal Reserve Bulletin • February 1990 Federal Open Market Committee FEDERAL OPEN MARKET COMMITTEE MEMBERS ALAN GREENSPAN, Chairman E. GERALD CORRIGAN, Vice Chairman WAYNE D. ANGELL W. LEE HOSKINS JOHN P. LAWARE EDWARD G. BOEHNE MANUEL H. JOHNSON MARTHA R. SEGER ROBERT H. BOYKIN EDWARD W. KELLEY, JR. GARY H. STERN ALTERNATE MEMBERS ROBERT P. BLACK SILAS KEEHN JAMES H. OLTMAN ROBERT P. FORRESTAL ROBERT T. PARRY STAFF DONALD L. KOHN, Secretary and Economist RICHARD W. LANG, Associate Economist NORMAND R.V. BERNARD, Assistant Secretary DAVID E. LINDSEY, Associate Economist GARY P. GILLUM, Deputy Assistant Secretary LARRY J. PROMISEL, Associate Economist J. VIRGIL MATTINGLY, JR., General Counsel ARTHUR J. ROLNICK, Associate Economist ERNEST T. PATRIKIS, Deputy General Counsel HARVEY ROSENBLUM, Associate Economist MICHAEL J. PRELL, Economist CHARLES J. SIEGMAN, Associate Economist EDWIN M. TRUMAN, Economist THOMAS D. SIMPSON, Associate Economist JOHN M. DAVIS, Associate Economist LAWRENCE SLIFMAN, Associate Economist RICHARD G. 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 WALTER J. CONNOLLY, JR., First District B. KENNETH WEST, Seventh District WILLARD C. BUTCHER, Second District DAN W. MITCHELL, Eighth District TERRENCE A. LARSEN, Third District LLOYD P. JOHNSON, Ninth District THOMAS H. O'BRIEN, Fourth District JORDAN L. HAINES, Tenth District FREDERICK DEANE, JR., Fifth District VACANCY, Eleventh District KENNETH L. ROBERTS, Sixth District PAUL HAZEN, Twelfth District HERBERT V. PROCHNOW, Secretary WILLIAM J. KORSVIK, Associate Secretary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A83 and Advisory Councils CONSUMER ADVISORY COUNCIL WILLIAM E. ODOM, Dearborn, Michigan, Vice Chairman GEORGE H. BRAASCH, Chicago, Illinois A. J. (JACK) KING, Kalispell, Montana BETTY TOM CHU, Arcadia, California MICHELLE S. MEIER, Washington, D.C. CLIFF E. COOK, Tacoma, Washington LINDA K. PAGE, Columbus, Ohio JERRY D. CRAFT, Atlanta, Georgia SANDRA PHILLIPS, Pittsburgh, Pennsylvania DONALD C. DAY, Boston, Massachusetts VINCENT P. QUAYLE, Baltimore, Maryland R.B. (JOE) DEAN, JR., Columbia, South Carolina CLIFFORD N. ROSENTHAL, New York, New York WILLIAM C. DUNKELBERG, Philadelphia, Pennsylvania ALAN M. SILBERSTEIN, New York, New York JAMES FLETCHER, Chicago, Illinois RALPH E. SPURGIN, Columbus, Ohio JAMES HEAD, Berkeley, California DAVID P. WARD, Peapack, New Jersey ROBERT A. HESS, Washington, D.C. LAWRENCE WINTHROP, Portland, Oregon BARBARA KAUFMAN, San Francisco, California THRIFT INSTITUTIONS ADVISORY COUNCIL DONALD B. SHACKELFORD, Columbus, Ohio, President MARION O. SANDLER, Oakland, California, Vice President CHARLOTTE CHAMBERLAIN, Glendale, California ELLIOTT K. KNUTSON, Seattle, Washington DAVID L. HATFIELD, Kalamazoo, Michigan JOHN W. LAISLE, Oklahoma City, Oklahoma LYNN W. HODGE, Greenwood, South Carolina PHILIP E. LAMB, Springfield, Massachusetts ADAM A. JAHNS, Chicago, Illinois JOHN PANCETTI, New York, New York H. C. KLEIN, Jacksonville, Arkansas CHARLES B. STUZIN, Miami, Florida Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A84 Federal Reserve Board Publications For ordering assistance, write PUBLICATIONS SER- Each Handbook, $90.00 per year. VICES, MS-138, Board of Governors of the Federal Reserve THE U.S. ECONOMY IN AN INTERDEPENDENT WORLD: A System, Washington, D.C. 20551 or telephone (202) 452- MULTICOUNTRY MODEL, May 1984. 590 pp. $14.50 each. 3244. When a charge is indicated, payment should accom- WELCOME TO THE FEDERAL RESERVE. MARCH 1989. 14 pp. pany request and be made payable to the Board of Governors PROCESSING AN APPLICATION THROUGH THE FEDERAL REof the Federal Reserve System. Payment from foreign resi- SERVE SYSTEM. August 1985. 30 pp. dents should be drawn on a U.S. bank. INDUSTRIAL PRODUCTION—1986 EDITION. December 1986. 440 pp. $9.00 each. THE FEDERAL RESERVE SYSTEM—PURPOSES AND FUNC- FINANCIAL FUTURES AND OPTIONS IN THE U.S. ECONOMY. TIONS. 1984. 120 pp. December 1986. 264 pp. $10.00 each. ANNUAL REPORT. ANNUAL REPORT: BUDGET REVIEW, 1988-89. Federal Reserve Bulletin. Monthly. $25.00 per year or $2.50 each in the United States, its possessions, Canada, and CONSUMER EDUCATION PAMPHLETS Mexico. Elsewhere, $35.00 per year or $3.00 each. Short pamphlets suitable for classroom use. Multiple copies BANKING AND MONETARY STATISTICS. 1914-1941. (Reprint are available without charge. of Part I only) 1976. 682 pp. $5.00. ANNUAL STATISTICAL DIGEST Consumer Handbook on Adjustable Rate Mortgages 1974-78. 1980. 305 pp. $10.00 per copy. Consumer Handbook to Credit Protection Laws 1981. 1982. 239 pp. $ 6.50 per copy. Federal Reserve Glossary 1982. 1983. 266 pp. $ 7.50 per copy. A Guide to Business Credit and the Equal Credit Opportunity 1983. 1984. 264 pp. $11.50 per copy. Act 1984. 1985. 254 pp. $12.50 per copy. A Guide to Federal Reserve Regulations 1985. 1986. 231 pp. $15.00 per copy. How to File A Consumer Credit Complaint 1986. 1987. 288 pp. $15.00 per copy. Series on the Structure of the Federal Reserve System 1987. 1988. 272 pp. $15.00 per copy. The Board of Governors of the Federal Reserve System 1988. 1989. 256 pp. $25.00 per copy. The Federal Open Market Committee SELECTED INTEREST AND EXCHANGE RATES—WEEKLY SE- Federal Reserve Bank Board of Directors RIES OF CHARTS. Weekly. $30.00 per year or $.70 each in Federal Reserve Banks the United States, its possessions, Canada, and Mexico. Organization and Advisory Committees Elsewhere, $35.00 per year or $.80 each. A Consumer's Guide to Mortgage Lock-Ins THE FEDERAL RESERVE ACT and other statutory provisions A Consumer's Guide to Mortgage Settlement Costs alfecting the Federal Reserve System, as amended A Consumer's Guide to Mortgage Refinancing through August 1988. 608 pp. $10.00 Making Deposits: When Will Your Money Be Available? REGULATIONS OF THE BOARD OF GOVERNORS OF THE FED- When Your Home is on the Line: What You Should Know ERAL RESERVE SYSTEM. About Home Equity Lines of Credit ANNUAL PERCENTAGE RATE TABLES (Truth in Lending— Regulation Z) Vol. I (Regular Transactions). 1969. 100 pp. Vol. II (Irregular Transactions). 1969. 116 pp. Each volume $2.25; 10 or more of same volume to one address, $2.00 each. PAMPHLETS FOR FINANCIAL INSTITUTIONS INTRODUCTION TO FLOW OF FUNDS. 1980. 68 pp. $1.50 each; Short pamphlets on regulatory compliance, primarily suit- 10 or more to one address, $1.25 each. able for banks, bank holding companies, and creditors. FEDERAL RESERVE REGULATORY SERVICE. Looseleaf; updated at least monthly. (Requests must be prepaid.) Limit of 50 copies Consumer and Community Affairs Handbook. $75.00 per year. The Board of Directors' Opportunities in Community Rein- Monetary Policy and Reserve Requirements Handbook. vestment $75.00 per year. The Board of Directors' Role in Consumer Law Compliance Securities Credit Transactions Handbook. $75.00 per year. Combined Construction/Permanent Loan Disclosure and The Payment System Handbook. $75.00 per year. Regulation Z Federal Reserve Regulatory Service. 3 vols. (Contains all Community Development Corporations and the Federal Rethree Handbooks plus substantial additional material.) serve $200.00 per year. Construction Loan Disclosures and Regulation Z Rates for subscribers outside the United States are as Finance Charges Under Regulation Z follows and include additional air mail costs: How to Determine the Credit Needs of Your Community Federal Reserve Regulatory Service, $250.00 per year. Regulation Z: The Right of Rescission Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A85 The Right to Financial Privacy Act 155. THE FUNDING OF PRIVATE PENSION PLANS, by Mark J. Signature Rules in Community Property States: Regulation B Warshawsky. November 1987. 25 pp. Signature Rules: Regulation B 156. INTERNATIONAL TRENDS FOR U.S. BANKS AND BANK- Timing Requirements for Adverse Action Notices: Regula- ING MARKETS, by James V. Houpt. May 1988. 47 pp. tion B 157. M2 PER UNIT OF POTENTIAL GNP AS AN ANCHOR FOR What An Adverse Action Notice Must Contain: Regulation B THE PRICE LEVEL, by Jeffrey J. Hallman, Richard D. Understanding Prepaid Finance Charges: Regulation Z Porter, and David H. Small. April 1989. 28 pp. 158. THE ADEQUACY AND CONSISTENCY OF MARGIN RE- QUIREMENTS IN THE MARKETS FOR STOCKS AND DERIV- STAFF STUDIES: Summaries Only Printed in the ATIVE PRODUCTS, by Mark J. Warshawsky with the Bulletin assistance of Dietrich Earnhart. September 1989. 23 pp. Studies and papers on economic and financial subjects that are of general interest. Requests to obtain single copies of REPRINTS OF BULLETIN ARTICLES the full text or to be added to the mailing list for the series may be sent to Publications Services. Most of the articles reprinted do not exceed 12 pages. Staff Studies 114-145 are out of print. Limit of 10 copies Foreign Experience with Targets for Money Growth. 10/83. 146. THE ROLE OF THE PRIME RATE IN THE PRICING OF Intervention in Foreign Exchange Markets: A Summary of BUSINESS LOANS BY COMMERCIAL BANKS, 1977-84, by Thomas F. Brady. November 1985. 25 pp. Ten Staff Studies. 11/83. A Financial Perspective on Agriculture. 1/84. 147. REVISIONS IN THE MONETARY SERVICES (DIVISIA) IN- DEXES OF THE MONETARY AGGREGATES, by Helen T. Survey of Consumer Finances, 1983. 9/84. Farr and Deborah Johnson. December 1985. 42 pp. Bank Lending to Developing Countries. 10/84. Survey of Consumer Finances, 1983: A Second Report. 148. THE MACROECONOMIC AND SECTORAL EFFECTS OF THE 12/84. ECONOMIC RECOVERY TAX ACT: SOME SIMULATION RESULTS, by Flint Brayton and Peter B. Clark. Decem- Union Settlements and Aggregate Wage Behavior in the ber 1985. 17 pp. 1980s. 12/84. The Thrift Industry in Transition. 3/85. 149. THE OPERATING PERFORMANCE OF ACQUIRED FIRMS IN BANKING BEFORE AND AFTER ACQUISITION, by Stephen A Revision of the Index of Industrial Production. 7/85. A. Rhoades. April 1986. 32 pp. Financial Innovation and Deregulation in Foreign Industrial Countries. 10/85. 150. STATISTICAL COST ACCOUNTING MODELS IN BANKING: A REEXAMINATION AND AN APPLICATION, by John T. Recent Developments in the Bankers Acceptance Market. Rose and John D. Wolken. May 1986. 13 pp. 1/86. The Use of Cash and Transaction Accounts by American 151. RESPONSES TO DEREGULATION: RETAIL DEPOSIT PRIC- ING FROM 1983 THROUGH 1985, by Patrick I. Mahoney, Families. 2/86. Alice P. White, Paul F. O'Brien, and Mary M. Financial Characteristics of High-Income Families. 3/86. McLaughlin. January 1987. 30 pp. Prices, Profit Margins, and Exchange Rates. 6/86. Agricultural Banks under Stress. 7/86. 152. DETERMINANTS OF CORPORATE MERGER ACTIVITY: A REVIEW OF THE LITERATURE, by Mark J. Warshawsky. Foreign Lending by Banks: A Guide to International and April 1987. 18 pp. U.S. Statistics. 10/86. 153. STOCK MARKET VOLATILITY, by Carolyn D. Davis and Recent Developments in Corporate Finance. 11/86. Alice P. White. September 1987. 14 pp. Measuring the Foreign-Exchange Value of the Dollar. 6/87. Changes in Consumer Installment Debt: Evidence from the 154. THE EFFECTS ON CONSUMERS AND CREDITORS OF PRO- 1983 and 1986 Surveys of Consumer Finances. 10/87. POSED CEILINGS ON CREDIT CARD INTEREST RATES, by Glenn B. Canner and James T. Fergus. October 1987. Home Equity Lines of Credit. 6/88. 26 pp. U.S. International Transactions in 1988. 5/89. Mutual Recognition: Integration of the Financial Sector in the European Community. 9/89 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A86 Index to Statistical Tables References are to pages A3-A79 although the prefix "A" is omitted in this index ACCEPTANCES, bankers (See Bankers acceptances) Demand deposits—Continued Agricultural loans, commercial banks, 19, 20 Turnover, 15 Assets and liabilities (See also Foreigners) Depository institutions Banks, by classes, 18-20, 72-77 Reserve requirements, 8 Domestic finance companies, 36 Reserves and related items, 3, 4, 5, 12 Federal Reserve Banks, 10 Deposits (See also specific types) Financial institutions, 26 Banks, by classes, 3, 18-20, 21, 73, 75, 77 Foreign banks, U.S. branches and agencies, 21 Federal Reserve Banks, 4, 10 Automobiles Turnover, 15 Consumer installment credit, 39, 40 Discount rates at Reserve Banks and at foreign central Production, 49, 50 banks and foreign countries (See Interest rates) Discounts and advances by Reserve Banks (See Loans) BANKERS acceptances, 9, 23, 24 Dividends, corporate, 35 Bankers balances, 18-20, 72, 74, 76. (See also Foreigners) Bonds (See also U.S. government securities) New issues, 34 EMPLOYMENT, 47 Rates, 24 Eurodollars, 24 Branch banks, 21, 57 Business activity, nonfinancial, 46 FARM mortgage loans, 38 Business expenditures on new plant and equipment, 35 Federal agency obligations, 4, 9, 10, 11, 31, 32 Business loans (See Commercial and industrial loans) Federal credit agencies, 33 Federal finance CAPACITY utilization, 48 Debt subject to statutory limitation, and types and Capital accounts ownership of gross debt, 30 Banks, by classes, 18, 73, 75, 77 Receipts and outlays, 28, 29 Federal Reserve Banks, 10 Treasury financing of surplus, or deficit, 28 Central banks, discount rates, 69 Treasury operating balance, 28 Certificates of deposit, 24 Federal Financing Bank, 28, 33 Commercial and industrial loans Federal funds, 6, 17, 19, 20, 21, 24, 28 Commercial banks, 16, 19, 72, 74, 76 Federal Home Loan Banks, 33 Weekly reporting banks, 19-21 Commercial banks Federal Home Loan Mortgage Corporation, 33, 37, 38 Assets and liabilities, 18-20 Federal Housing Administration, 33, 37, 38 Federal Land Banks, 38 Commercial and industrial loans, 16, 18, 19, 20, 21, 72, Federal National Mortgage Association, 33, 37, 38 74, 76 Federal Reserve Banks Consumer loans held, by type and terms, 39, 40 Condition statement, 10 Loans sold outright, 19 Discount rates (See Interest rates) Nondeposit funds, 17 U.S. government securities held, 4, 10, 11, 30 Number by classes, 73, 75, 77 Federal Reserve credit, 4, 5, 10, 11 Real estate mortgages held, by holder and property, 38 Federal Reserve notes, 10 Time and savings deposits, 3 Federal Reserve System Commercial paper, 23, 24, 36 Balance sheet for priced services, 78 Condition statements (See Assets and liabilities) Condition statement for priced services, 79 Construction, 46, 51 Federal Savings and Loan Insurance Corporation insured Consumer installment credit, 39, 40 institutions, 26 Consumer prices, 46, 48 Federally sponsored credit agencies, 33 Consumption expenditures, 53, 54 Finance companies Corporations Assets and liabilities, 36 Nonfinancial, assets and liabilities, 35 Business credit, 36 Profits and their distribution, 35 Loans, 39, 40 Security issues, 34, 67 Paper, 23, 24 Cost of living (See Consumer prices) Financial institutions Credit unions, 26, 39. (See also Thrift institutions) Loans to, 19, 20, 21 Currency and coin, 18, 72, 74, 76 Selected assets and liabilities, 26 Currency in circulation, 4, 13 Float, 4, 79 Customer credit, stock market, 25 Flow of funds, 41, 43, 44, 45 DEBITS to deposit accounts, 15 Foreign banks, assets and liabilities of U.S. branches and Debt (See specific types of debt or securities) agencies, 21 Demand deposits Foreign currency operations, 10 Banks, by classes, 18-21, 73, 75, 77 Foreign deposits in U.S. banks, 4, 10, 19, 20 Ownership by individuals, partnerships, and Foreign exchange rates, 70 corporations, 22 Foreign trade, 56 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A87 Foreigners REAL estate loans Claims on, 57, 59, 62, 63, 64, 66 Banks, by classes, 16, 19, 20, 38, 74 Liabilities to, 20, 56, 57, 59, 60, 65, 67, 68 Financial institutions, 26 Terms, yields, and activity, 37 GOLD Type of holder and property mortgaged, 38 Certificate account, 10 Repurchase agreements, 6, 17, 19, 20, 21 Stock, 4, 56 Reserve requirements, 8 Government National Mortgage Association, 33, 37, 38 Reserves Gross national product, 53 Commercial banks, 18, 73 Depository institutions, 3, 4, 5, 12 HOUSING, new and existing units, 51 Federal Reserve Banks, 10 U.S. reserve assets, 56 INCOME and expenses, Federal Reserve System, 78-79 Residential mortgage loans, 37 Income, personal and national, 46, 53, 54 Retail credit and retail sales, 39, 40, 46 Industrial production, 46, 49 Installment loans, 39, 40 SAVING Insurance companies, 26, 30, 38 Flow of funds, 41, 43, 44, 45 Interest rates National income accounts, 53 Bonds, 24 Savings and loan associations, 26, 38, 39, 41. (See also Consumer installment credit, 40 Thrift institutions) Federal Reserve Banks, 7 Savings banks, 26, 38, 39 Foreign central banks and foreign countries, 69 Savings deposits (See Time and savings deposits) Money and capital markets, 24 Securities (See also specific types) Mortgages, 37 Federal and federally sponsored credit agencies, 33 Prime rate, 23 Foreign transactions, 67 International capital transactions of United States, 55-69 New issues, 34 International organizations, 59, 60, 62, 65, 66 Prices, 25 Inventories, 53 Special drawing rights, 4, 10, 55, 56 Investment companies, issues and assets, 35 State and local governments Investments (See also specific types) Deposits, 19, 20 Banks, by classes, 18, 19, 20, 21, 26 Holdings of U.S. government securities, 30 Commercial banks, 3, 16, 18-20, 38, 72 New security issues, 34 Federal Reserve Banks, 10, 11 Ownership of securities issued by, 19, 20, 26 Federal Reserve System, 78-79 Rates on securities, 24 Financial institutions, 26, 38 Stock market, selected statistics, 25 Stocks (See also Securities) LABOR force, 47 New issues, 34 Life insurance companies (See Insurance companies) Prices, 25 Loans (See also specific types) Banks, by classes, 18—20 Student Loan Marketing Association, 33 Commercial banks, 3, 16, 18-20, 72, 74, 76 Federal Reserve Banks, 4, 5, 7, 10, 11 TAX receipts, federal, 29 Federal Reserve System, 78-79 Thrift institutions, 3. (See also Credit unions and Savings Financial institutions, 26, 38 and loan associations) Insured or guaranteed by United States, 37, 38 Time and savings deposits, 3, 13, 17, 18, 19, 20, 21, 73, 75, 77 MANUFACTURING Trade, foreign, 56 Capacity utilization, 48 Treasury cash, Treasury currency, 4 Production, 48, 50 Treasury deposits, 4, 10, 28 Margin requirements, 25 Treasury operating balance, 28 Member banks (See also Depository institutions) Federal funds and repurchase agreements, 6 UNEMPLOYMENT, 47 Reserve requirements, 8 U.S. government balances Mining production, 50 Commercial bank holdings, 18, 19, 20 Mobile homes shipped, 51 Treasury deposits at Reserve Banks, 4, 10, 28 Monetary and credit aggregates, 3, 12 U.S. government securities Money and capital market rates, 24 Bank holdings, 18-20, 21, 30, 72, 74, 76 Money stock measures and components, 3, 13 Dealer transactions, positions, and financing, 32 Mortgages (See Real estate loans) Federal Reserve Bank holdings, 4, 10, 11, 30 Mutual funds, 35 Foreign and international holdings and transactions, 10, 30, 68 Mutual savings banks (See Thrift institutions) Open market transactions, 9 NATIONAL defense outlays, 29 Outstanding, by type and holder, 26, 30 National income, 53 Rates, 24 U.S. international transactions, 55-69 OPEN market transactions, 9 Utilities, production, 50 PERSONAL income, 54 VETERANS Administration, 37, 38 Prices Consumer and producer, 46, 52 WEEKLY reporting banks, 19-21 Stock market, 25 Wholesale (producer) prices, 46, 52 Prime rate, 23 Producer prices, 46, 52 YIELDS (See Interest rates) Production, 46, 49 Profits, corporate, 35 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A88 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 Richard N. Cooper Richard F. Syron Richard L. Taylor Robert W. Eisenmenger NEW YORK* 10045 Cyrus R. Vance E. Gerald Corrigan Ellen V. Futter James H. Oltman Buffalo 14240 Mary Ann Lambertsen John T. Keane PHILADELPHIA 19105 Peter A. Benoliel Edward G. Boehne Gunnar E. Sarsten William H. Stone, Jr. CLEVELAND* 44101 Charles W. Parry W. Lee Hoskins John R. Miller William H. Hendricks Cincinnati 45201 To be announced Charles A. Cerino1 Pittsburgh 15230 Robert P. Bozzone Harold J. Swart1 RICHMOND* 23219 Hanne M. Merriman Robert P. Black Anne Marie Whittemore Jimmie R. Monhollon Baltimore 21203 John R. Hardesty, Jr. Robert D. McTeer, Jr.1 Charlotte 28230 William E. Masters Albert D. Tinkelenberg1 Culpeper Communications John G. Stoides1 and Records Center 22701 ATLANTA 30303 Larry L. Prince Robert P. Forrestal Edwin A. Huston Jack Guynn Donald E. Nelson Birmingham 35283 A. G. Trammell Fred R. Herr1 Jacksonville 32231 Lana Jane Lewis-Brent James D. Hawkins1 Miami 33152 Victoria B. Jackson James T. Curry III Nashville 37203 Caroline G. Theus Melvin K. Purcell New Orleans 70161 Robert D. Apelgren Robert J. Musso CHICAGO* 60690 Marcus Alexis Silas Keehn Charles S. McNeer Daniel M. Doyle Detroit 48231 Phyllis E. Peters Roby L. Sloan1 ST. LOUIS 63166 H. Edwin Trusheim Thomas C. Melzer Robert H. Quenon James R. Bowen Little Rock 72203 To be announced John F. Breen1 Louisville 40232 To be announced Howard Wells Memphis 38101 To be announced Ray Laurence MINNEAPOLIS 55480 Michael W. Wright Gary H. Stern Delbert W. Johnson Thomas E. Gainor Helena 59601 J. Frank Gardner John D. Johnson KANSAS CITY 64198 Fred W. Lyons, Jr. Roger Guffey Burton A. Dole, Jr. Henry R. Czerwinski Denver 80217 Barbara B. Grogan Kent M. Scott Oklahoma City 73125 John F. Snodgrass David J. France Omaha 68102 Herman Cain Harold L. Shewmaker DALLAS 75222 Bobby R. Inman Robert H. Boykin Hugh G. Robinson William H.Wallace Tony J. Salvaggio1 El Paso 79999 To be announced Sammie C. Clay Houston 77252 To be announced Robert Smith, III1 San Antonio 78295 To be announced Thomas H. Robertson SAN FRANCISCO 94120 Robert F. Erburu Robert T. Parry Carolyn S. Chambers Carl E. Powell Los Angeles 90051 Yvonne B. Burke Thomas C. Warren2 Portland 97208 William A. Hilliard Angelo S. Carella1 Salt Lake City 84125 Don M. Wheeler E. Ronald Liggett1 Seattle 98124 Bruce R. Kennedy Gerald R. Kelly1 *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. 1. Senior Vice President. 2. Executive Vice President. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A89 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories 1 1 / ALASKA »/ / iMMM © ** // // //00 // •Xs 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 Three booklets on the mortgage process are also PUBLICATIONS available: A Consumer's Guide to Mortgage Refinancings, A Consumer's Guide to Mortgage Lock-Ins, and The Federal Reserve Board publishes a series of A Consumer's Guide to Mortgage Settlement Costs. pamphlets covering individual credit laws and topics, These booklets were prepared in conjunction with the as pictured below. The series includes such subjects as Federal Home Loan Bank Board and in consultation how the Equal Credit Opportunity Act protects wom- with other federal agencies and trade and consumer en against discrimination in their credit dealings, how groups. to use a credit card, and how to resolve a billing error. Copies of consumer publications are available free The Board also publishes the Consumer Handbook of charge from Publications Services, Mail Stop 138, to Credit Protection Laws, a complete guide to con- Board of Governors of the Federal Reserve System, sumer credit protections. This 44-page booklet ex- Washington, D.C. 20551. Multiple copies for classplains how to use the credit laws to shop for credit, room use are also available free of charge. apply for it, keep up credit ratings, and complain about an unfair credit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Publications of Interest NEW HANDBOOK AVAILABLE FROM THE containing all Board regulations and related statutes, REGULATORY SERVICE interpretations, policy statements, rulings, and staff opinions. For those with a more specialized interest in The Federal Reserve Board has announced publica- the Board's regulations, parts of this service are pubtion of The Payment System Handbook. The new lished separately as handbooks pertaining to monetary handbook, which is part of the Federal Reserve Reg- policy, securities credit, consumer affairs, and, availulatory Service, deals with expedited funds availabil- able for the first time in September 1988, The Payment ity, check collection, wire transfers, and risk-reduc- System Handbook. tion policy. It includes Regulation CC (Availability of For domestic subscribers, the annual rate for The Funds and Collection of Checks), Regulation J (Col- Payment System Handbook is $75. For subscribers lection of Checks and Other Items and Wire Transfers outside the United States, the price, including addiof Funds by Federal Reserve Banks), the Expedited tional air mail costs, is $90. For the Federal Reserve Funds Availability Act and related statutes, official Regulatory Service, not including handbooks, the an- Board commentary on Regulation CC, and policy nual rate is $200 for domestic subscribers and $250 for statements on risk reduction in the payment system. In subscribers outside the United States. All subscription addition, it contains detailed subject and citation in- requests must be accompanied by a check payable to dexes. It is published in loose-leaf binder form and is "Board of Governors of the Federal Reserve updated monthly. System." Orders should be addressed to Publications To promote public understanding of its regulatory Services, Mail Stop 138, Board of Governors of the functions, the Board publishes the Federal Reserve Federal Reserve System, Washington, D.C. 20551. Regulatory Service, a three-volume loose-leaf service Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis