Federal Reserve Bulletin, 1995-06

VOLUME 81 • NUMBER 6 • JUNE 1995 FEDERAL RESERVE 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 • Richard Spillenkothen • 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 S. Ellen Dykes, the Graphics Center 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 545 PROFITS AND BALANCE SHEET 0.2 percent against the Canadian dollar, and DEVELOPMENTS AT US. COMMERCIAL 7.8 percent on a trade-weighted basis. The BANKS IN 1994 U.S. monetary authorities entered the foreign exchange markets on March 2 and March 3 to In 1994, bank profits increased $\V2 billion, to support the dollar. In other operations, Mexico a record $44 Vi billion. Although profitability, drew a net $1 billion on its swap facility with as measured by return on assets, dipped the Federal Reserve and a net $4 billion on the because of rapid growth in reported assets, it Treasury Department's Exchange Stabilizaremained quite high by historical standards. It tion Fund. These drawings were part of the was supported by a substantial reduction in $20 billion financial aid package to Mexico loan-loss provisions; a decline in net noninterannounced by the Clinton Administration on est expense as a share of assets also contrib- January 31 and signed on February 21. uted to the high profitability. In contrast, net interest income, although remaining at a high level, dipped as a share of assets. Banks 592 INDUSTRIAL PRODUCTION AND retained about one-third of their profits, and CAPACITY UTILIZATION FOR APRIL 1995 capital-asset ratios remained well above regu- Industrial production declined 0.4 percent in latory minimums on average. April after a decrease of 0.3 percent in March. Capacity utilization declined 0.6 percentage 570 MONETARY POLICY AND OPEN MARKET point in April after falling 0.5 percent percent- OPERATIONS DURING 1994 age point in March. At 84.1 percent, the rate of capacity utilization in April was below both In 1994 the operating techniques for implethe 85.5 percent high attained this past menting monetary policy remained similar to December and January and the 84.9 percent those of recent years; however, the Trading high reached during the 1988-89 period. Desk at the Federal Reserve Bank of New York gained slightly more flexibility in its execution of open market operations after the 595 ANNOUNCEMENTS Federal Open Market Committee (FOMC) Revisions of the Board's Community Reinbegan announcing its policy actions in Februvestment Act regulations. ary. This article briefly reviews the course of monetary policy in 1994 and describes the Issuance of an interpretation of Regulation H. responses of the fixed-income securities markets to economic and policy developments. It Adoption of a regulatory "safe harbor" in also discusses the Open Market Trading relation to the anti-tying restrictions in Desk's implementation of the objectives Regulation Y. established by the FOMC. Proposed amendment to Regulation O; proposal to permit, but not require, banks and 585 TREASURY AND FEDERAL RESERVE other creditors to request information on the FOREIGN EXCHANGE OPERATIONS race, color, sex, religion, and national origin of applicants for credit. During the first quarter of 1995, the dollar declined 11.3 percent against the German Publication of the revised List of OTC Stocks mark, 13.1 percent against the Japanese yen, Subject to Margin Regulations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Issuance of a report on the processing of A67 GUIDE TO STATISTICAL RELEASES AND applications during 1994. SPECIAL TABLES Publication of a new report, Descriptive Sta- A68 INDEX TO STATISTICAL TABLES tistics from the 1987 National Survey of Small Business Finances. A70 BOARD OF GOVERNORS AND STAFF Publication of the 81st Annual Report, 1994. A72 FEDERAL OPEN MARKET COMMITTEE AND STAFF; ADVISORY COUNCILS 598 LEGAL DEVELOPMENTS Various bank holding company, bank service A74 FEDERAL RESERVE BOARD corporation, and bank merger orders; and PUBLICATIONS pending cases. A76 SCHEDULE OF RELEASE DATES FOR 627 MEMBERSHIP OF THE BOARD OF PERIODIC RELEASES GOVERNORS OF THE FEDERAL RESERVE SYSTEM, 1913-95 A78 MAPS OF THE FEDERAL RESERVE List of appointive and ex officio members. SYSTEM A1 FINANCIAL AND BUSINESS STATISTICS A80 FEDERAL RESERVE BANKS, BRANCHES, AND OFFICES These tables reflect data available as of April 26, 1995. A3 GUIDE TO TABULAR PRESENTATION A4 Domestic Financial Statistics A45 Domestic Nonfinancial Statistics A53 International Statistics Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 William B. English and Brian K. Reid, of the 1. Selected income and expense items, 1991-94 Board's Division of Monetary Affairs, prepared this Percent article. Thomas C. Allard assisted in the preparation of the data, and James Y. Park provided research assistance. In 1994, bank profits increased $ll/z billion, to a record $441/2 billion. Although profitability, as measured by return on assets, dipped because of rapid growth in reported assets, it remained quite high by historical standards (table 1). It was supported by a substantial reduction in loan-loss provisions: Banks were able to lower provisions as loan NOTE. Percentage of average net consolidated assets. quality improved because of both their past efforts to tighten credit standards and the continued expanmore heavily on short-term borrowing, including sion of the U.S. economy. A decline in net noninterbank loans. The effect of increased demand on loan est expense as a share of assets also contributed growth was augmented by banks' greater willingto the high profitability; in contrast, net interest ness to lend. As a result, loans expanded at the income, although remaining at a high level, dipped as a share of assets.1 fastest pace in more than ten years, and bank loans as a share of private sector debt rose for the second Brisker economic growth entailed stronger busiconsecutive year (chart 1). Banks financed most of ness and consumer borrowing, which expanded substantially despite higher interest rates. Indeed, the rise in market interest rates, particularly at 1. Bank loans as a percentage of private-sector debt, longer maturities, encouraged businesses to rely 1970-94 1. Except where otherwise indicated, data in this article are from the quarterly Reports of Condition and Income (Call Reports) for insured domestic commercial banks and nondeposit trust companies. The data, which cover all such institutions that filed Call Reports at least once, consolidate information from foreign and domestic offices and have been adjusted to take account of mergers. Size categories of such institutions (in this article called banks), which are based on assets at the start of each quarter, are as follows: the ten largest banks; large banks, those numbered 11 through 100 by size; medium-sized banks, those numbered 101 through 1,000 by size; and small banks, those not among the largest 1,000 banks. At the start of the fourth quarter of 1994, the ten largest banks had assets of more than $40 billion, large banks had assets between $6.5 billion and $40 billion, medium-sized banks had assets NOTE. The data are quarterly. Loans consist of outstanding business, between approximately $300 million and $6.5 billion, and small consumer, and mortgage loans held by domestic banks and branches and banks had assets of less than approximately $300 million. Because agencies of foreign banks located in the United States. Private sector of report changes, data for the years before 1985 are not strictly includes households and nonfinancial businesses (farm, corporate, and comparable to the more recent data. In the tables, components may noncorporate). not sum to totals because of rounding. SOURCE. Federal Reserve Board, statistical release Z.l. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

546 Federal Reserve Bulletin • June 1995 2. Measures of profitability, 1970-94 was attributable to FIN 39, which caused reported noninterest-earning assets and liabilities to expand about $90 billion (see box on pages 548-49). Interest-earning assets grew more slowly than they did in 1993, as banks funded a portion of their loan growth by running off securities. The runoff ended the shift from loans to securities that began in 1990. Bank holdings of U.S. Treasury securities in investment accounts declined about 8V2 percent. While much of this decrease was attributable to sales, about 15 percent was due to the fall in prices of Treasury securities. Before last year's implementation of Statement of Finan- NOTE. The data are annual. cial Accounting Standards No. 115 (SFAS 115), which resulted in banks' marking to market a larger the increase in loans by issuing managed liabilities, share of their securities, such changes in the market but in the second half of the year they also reduced value of securities would have had little effect on holdings of securities. bank balance sheets. Non-interest-earning assets rose sharply last year for technical reasons. For reporting purposes, bank regulators adopted Financial Accounting Standards Loans to the Business Sector Board Interpretation No. 39 (FIN 39). By limiting banks' ability to net the value of off-balance-sheet Commercial and industrial (C&I) loans expanded derivative contracts, whose market values are re- almost 9V2 percent, the largest increase in more ported on bank balance sheets, FIN 39 boosted than a decade. The surge partly reflected reported assets and liabilities. About half of the stepped-up demand for credit by nonfinancial cordecline in the average return on assets (ROA), porations. These firms boosted capital expendishown in chart 2, was attributable to the effects of tures, including inventory investment, by amounts FIN 39. that outstripped gains in retained earnings and other Banks retained about one-third of their profits, internal funding sources. Also, their borrowing and capital-asset ratios remained well above reg- shifted toward shorter-term instruments, as they cut ulatory minimums on average. The industry's net bond and equity issuance because of higher improved health was evident not only in stronger long-term interest rates and a lackluster stock marbalance sheets and sustained profitability but also ket (chart 3). in measures of bank distress. Bank failures dwindled to just eleven, and the institutions classi- 3. Net offerings of long-term securities by nonfinancial fied by the Federal Deposit Insurance Corporation corporations, 1987-94 as problem banks fell to 247, down more than 40 percent from 1993. Combined assets of problem banks fell even more dramatically—from $242 billion at year-end 1993 to $33 billion at year-end 1994—down more than 90 percent from the record level in early 1992. Stocks BALANCE SHEET DEVELOPMENTS Bank assets grew at the fastest pace since 1985— 1992 more than 8 percent from year-end 1993 to year- NOTE. The data are quarterly. end 1994 (table 2). About one-third of the increase SOURCES. Federal Reserve Board, statistical release Z.l. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 547 Consistent with these funding patterns of nonfi- vey respondents attributed the higher demand nancial corporations, banks included in the Federal mainly to their customers' need to finance inven- Reserve's periodic Senior Loan Officer Opinion tories and investments in plant and equipment. Survey on Bank Lending Practices (LPS) reported Several banks also noted that the pickup in merger stronger loan demand from businesses of all sizes.2 and acquisition activity boosted demand for busi- On average, a net of about 30 percent of banks ness loans. A substantial share of this activity, reported increased demand for business loans over however, was funded with commercial paper, the three months preceding the survey dates. Sur- which expanded rapidly during the second half of the year. Banks usually provide backup lines of credit to firms issuing commercial paper; conse- 2. About sixty domestic commercial banks from the twelve Federal Reserve Districts are on the LPS panel. Most of them are quently, the pickup in commercial paper issuance large: As of December 31, 1994, the combined assets of the panel last year probably contributed to the 16 percent banks were $1.7 trillion, about 40 percent of the assets of domestic increase in unused commercial lines of credit. commercial banks. 2. Annual rates of growth of balance sheet items, 1985-94 Percent Memo: Dec. 1994 Item 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 levels (billions of dollars) Assets 8.91 7.65 2.00 4.36 5.32 2.66 1.32 2.18 5.66 8.08 3,989 Interest-earning assets 9.60 7.81 3.08 4.06 5.59 2.24 1.97 2.54 6.54 5.32 3,455 Loans and leases (net) 7.91 7.35 3.00 5.95 6.23 2.38 -2.66 -1.02 6.02 9.87 2292 Commercial and industrial. 2.16 3.95 -1.95 1.86 2.95 -.67 -9.10 -4.11 .54 9.33 586 Real estate 13.75 17.46 16.56 12.46 12.66 8.81 2.72 1.94 6.11 7.95 990 Booked in domestic offices 13.50 17.06 17. 1 12.02 12.99 8.56 2.88 2.56 6.15 7.69 964 Residential 9.85 12.78 18.03 13.92 15.73 13.49 8.07 7.88 10.94 10.01 597 Nonresidential 17.35 21.28 16.26 10.26 10.36 3.60 -2.84 -3.96 -.46 4.12 367 Booked in foreign offices 22.49 30.20 .84 27.03 ; 3.00 16.65 -2.34 -17.80 4.66 18.41 26 Consumer 15.74 8.32 4.55 7.64 6.18 .37 -2.55 -1.53 8.91 16.04 484 Other loans and leases 4.54 -.96 -5.33 -3.08 -.95 -5.67 -4.92 -4.28 9.94 5.33 289 Loss reserves and unearned income 9.09 9.41 44.36 -4.19 10.29 .34 -3.80 -4.78 -5.93 -2.20 58 Securities 15.95 9.91 4.94 3.30 5.02 8.47 16.23 12.27 12.27 -4.13 911 Investment account 14.05 10.25 7.51 2.97 4.01 8.19 14.42 11.43 8.09 -1.71 814 U.S. Treasury 5.40 1.64 .00 -5.80 -13.79 3.51 32.02 23.92 7.23 -8.44 239 U.S. government agency and corporation obligations -4.00 53 55 25.46 22.54 33.42 24.01 15.88 12.77 9.61 .88 397 Other 32.98 2.25 4.43 -2.37 -.97 -6.69 -2.56 -5.23 6.05 2.53 178 Trading account 41.40 6.21 -23.88 8.58 » 20.34 : 12.13 38.89 21.02 51.95 -20.54 9? Other 9.22 6.89 .24 -5.82 2.50 -11.69 2.81 1.53 -7.88 3.22 252 Non-interest-earning assets 4.61 6.6! -5.08 6.49 3.45 5.62 -3.13 -.38 -.87 30.23 534 Liabilities 8.85 7.65 2.18 4.07 5.41 2.39 1.01 1.35 5.10 8.33 3,678 Transaction and core deposits .. 10.28 11.78 -.76 5.48 5.75 7.57 5.21 5.12 1.48 -.14 2,205 Transaction deposits 10.82 17.50 -6.04 2.65 .93 2.42 3.38 14.61 5.45 -.29 848 Core deposits 9.94 8.07 2.95 7.29 8.71 10.51 6.19 .23 -.86 -.05 1,357 Managed liabilities' 9.17 3.05 6.90 2.31 5.15 -6.12 -6.13 -6.14 12.29 17.63 1,247 Deposits booked in foreign offices IM -2.49 8.86 -7.77 -1.08 -5.88 3.82 -5.85 15.06 30.89 432 Large time 4.29 -1.07 12.16 9.22 5.00 -5.68 -19.54 -26.38 -9.21 8.74 218 Subordinated notes and debentures 43.84 15.77 3.72 -4.26 16.99 23.46 4.03 33.04 10.82 9.21 41 Other managed liabilities — 23.11 12.13 .78 5.59 9.97 -8.10 -1.35 7.10 22.19 13.01 557 Other -8.97 -7.00 3.75 .12 2.53 4.40 -4.29 -1.09 14.95 77.92 226 Equity capital 9.77 7J58 -.67 8.80 4.10 6.79 5.92 13.75 12.59 5.22 311 MEMO Commercial real estate loans2 — !U. a.a. a.a. <1.8. n«a. n.a. -3.49 -5 20 -1.33 3.68 362 NOTE. Data are from year-end to year-end. 2. Measured as the sum of construction and land development loans n.a. Not available. secured by real estate; real estate loans secured by nonfarm nonresidential 1. Measured as the sum of deposits in foreign offices, large time deposits properties; and loans to finance commercial real estate, construction, and in domestic offices, federal funds purchased and securities sold under agree- land development activities not secured by real estate. ments to resell, demand notes issued to the U.S. Treasury, subordinated notes and debentures, and other borrowed money. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

548 Federal Reserve Bulletin • June 1995 Banks' easing of terms and standards on loans In contrast, only a few banks appear to have likely boosted business lending as well. Some LPS relaxed their standards for commercial real estate respondents reported that they had relaxed stan- loans (chart 4). Nonetheless, after three years of dards for C&I loans (chart 4). In addition, many decline, commercial real estate loans expanded. banks said that they had cut credit-line costs and The demand for these loans was likely boosted by a spreads over base rates. A number of respondents pickup in investment in nonresidential structures. also cited easing other terms, including loan The higher investment came in the wake of lower covenants, maximum sizes of credit lines, and vacancy rates and higher commercial real estate collateralization requirements. A broader sample of prices in many parts of the country. Indeed, prices banks included in the Federal Reserve's Survey of for commercial real estate properties increased on a Terms of Bank Lending to Business reported some national average basis for the first time in four further narrowing of spreads of loan rates over years (chart 6). The better market for commercial market interest rates on small- and medium-sized real estate probably also helped reduce assets clasloans from the peaks reached earlier in the decade sified as other real estate owned, which dropped (chart 5). 40 percent and ended the year at the lowest level The Effect of Accounting Changes on Bank Balance Sheets in 1994 Banks' balance sheets were affected in 1994 by two they are reflected (on an after-tax basis) directly in accounting changes issued by the Financial Accounting bank equity. Consequently, ratios of equity capital to Standards Board (FASB) and adopted by bank regulators; assets, reflecting the after-tax adjustments from Statement of Financial Accounting Standards No. 115 SFAS 115, increase with unrealized gains and decrease (SFAS 115) and FASB Interpretation No. 39 (FIN 39). with unrealized losses. Regulatory definitions of capital Bank regulators generally required banks to implement generally do not recognize the SFAS 115 adjustment, these accounting changes for the March 1994 Call Report however, and the risk-based capital ratios are unaffected. but permitted banks to adopt them for earlier reports. As before the adoption of SFAS 115, net unrealized Because a number of balance sheet items were affected losses on marketable equity securities reduce tier 1 and some banks adopted SFAS 115 early, several breaks capital. occur in the data beginning in late 1993. SFAS 115 affected banks of all sizes, but FIN 39 affected princi- FASB Interpretation No. 39 pally the ten largest banks. The market value of off-balance-sheet derivatives can be positive or negative. Before the adoption of FIN 39, Statement of Financial Accounting banks holding these contracts in their trading port- Standards No. 115 folios generally posted to their balance sheets the market Under SFAS 115, all debt and marketable equity securi- value of the contracts after netting across various ties are assigned one of three designations: held to matu- counterparties—a practice termed "grandslam netrity, available for sale, or held for trading. Securities ting." The net value was recorded as an asset if posiidentified as being held to maturity are reported at amor- tive and as a liability if negative. The contracts were tized cost, whereas those available for sale are marked to marked to market over time as their values fluctuated, market. Previously, debt securities were designated as and unrealized gains or losses flowed through the income held for sale, held for investment, or held for trading. statement and were passed to equity by way of retained Debt securities held for sale were reported at the lower of earnings. amortized cost or market value, and those held for invest- Under FIN 39, the Financial Accounting Standards ment were reported at amortized cost. SFAS 115 did not Board prohibits grandslam netting and limits netting to affect the reporting of securities designated as held for positions with the same counterparty when certain legal trading, which continue to be marked to market. criteria are met. Trading positions remain marked to Changes in the market value of securities available for market, and unrealized gains and losses continue to flow sale, unlike those of securities held in trading accounts, through the income statement to affect the level of equity. do not affect reported income under SFAS 115, but Because many of the derivative contracts could no Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 549 since 1987. Banks generally acquire these assets to securitize ARMs because these mortgages when they foreclose on nonperforming loans that expose them to less interest rate risk than do are collateralized with real estate. fixed rate mortgages. During the last few months of 1994, more than half of all newly issued conventional home mortgages originated by banks were Loans to the Household Sector ARMs. Consumer loans held on bank balance sheets Growth in bank holdings of residential real estate expanded 16 percent, the fastest rate in more than a loans slowed a bit last year but remained strong. decade. The rapid growth of consumer loans was While higher mortgage interest rates damped hous- spurred by a rise of 10 percent in consumer expening sales, especially late last year, higher rates on ditures for durable goods. Increased convenience fixed rate mortgages encouraged households to use of credit cards, associated with credit card shift to adjustable rate mortgages (ARMs). This promotions and expanded acceptance at nontradishift helped to support the growth of residential tional outlets such as grocery stores, probably also loans on bank balance sheets; banks are less likely accounted for some of the growth. Although the The Effect of Accounting Changes—Continued longer be netted, however, banks with large holdings of available-for-sale securities totaled about $16 billion and derivatives in their trading accounts posted substantial reduced reported capital about $11 billion. On average increases in assets (and liabilities) in 1994, an action that over the year, SFAS 115 reduced reported assets about reduced their tier 1 leverage ratios. By contrast, regula- $4 billion. tory risk-based capital ratios were unaffected because a The adoption of FIN 39 boosted bank assets in 1994 gross, rather than a net, value of off-balance-sheet con- roughly $90 billion, which was about one-third of the tracts was already used to compute risk-weighted assets. change in bank assets. The on-balance-sheet values appear in non-interest-bearing assets and liabilities. As a Balance Sheet Effects result of the combined effects of SFAS 115 and FIN 39, all items shown as a percentage of assets are not strictly Following die implementation of SFAS 115, slightly comparable to items shown for years before 1994. For more than one-half of investment account securities were example, the ROA for all banks fell 5 basis points. categorized as available for sale, except for the ten largest Without the change, the ROA would have fallen 2 basis banks, which reported about two-thirds of theirs as avail- points. Because FIN 39 affected principally derivative able for sale. The 1994 runup in interest rates pushed dealers, about 90 percent of its total effect was concensecurity values lower, and unrealized losses on the trated at the ten largest banks. Effects of SFAS 115 and FIN 39 Selected income and expense items Return on assets Percent Percent 1994 Item 1993 1994 JjSL 1993 1994 Class of bank adjusted Net interest income 3.90 3.78 3.87 All banks 1.20 1.15 1.18 Net noninterest Small 1.19 1.16 1.15 expense 1.81 1.75 1.79 Medium 1.22 1.29 1.29 Loss provisions .47 .28 .29 Large 1.26 1.22 1.23 Net income 1.20 1.15 1.18 Ten largest 1.13 .91 1.00 NOTE. Percentage of average net consolidated assets. Right-hand columns show percentages based on assets adjusted to remove the effects of SFAS 115 and FIN 39. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

550 Federal Reserve Bulletin • June 1995 resulting balances are paid off within the interest- Consumer loan growth was also lifted by a free grace period, they nonetheless boost the aver- greater willingness of banks to provide credit. On age level of consumer debt outstanding. balance, in each survey about 25 percent of the LPS respondents indicated that they were more willing to make consumer loans than they had been 4. Net percentage of selected large commercial banks that three months earlier. This increased willingness to tightened credit standards, 1990:Q2-95:Q1 make consumer loans was also evident in unused credit card lines, which rose almost 30 percent, to Commercial and industrial loans, by size of firm seeking loan1 $860 billion by year-end. Liabilities ' " '' •• ff'i _ '•'* •.'r Y'vt In 1994, banks reduced holdings of securities to fund part of their loan growth, but they financed most of the increase with managed liabilities. A I 1 I I —1 heavier reliance on managed liabilities emerged in Commercial real estate loans, by purpose of loan2 1993. In the previous few years, banks had run off managed liabilities because they had been reducing their loans and were flush with core (transaction, savings, and small time) deposits, some of which they had acquired from failed thrifts. The bulk of the thrift closures had occurred by 1991; as a consequence, when loan growth accelerateo^n 1993-94, banks relied on managed liabilities to fund the increases. Money markets were receptive to the increased issuance of managed liabilities in part because of healthier bank balance sheets and NOTE. The data are quarterly. Net percentage is the percentage of banks improved credit ratings. reporting tightening less the percentage reporting easing. 1. The data for large firms begin in 1990:Q3. Size definition suggested As in 1993, deposits booked in foreign offices for, and generally used by, survey respondents is that medium-sized firms are were an important source of funding. Domestic those with annual sales of between $50 million and $250 million. 2. The data for construction and land development loans begin in offices of commercial banks increased their net 1990:Q3. borrowing from their foreign offices by $75 billion SOURCE. Federal Reserve Board, Senior Loan Officer Opinion Survey on Bank Lending Practices. 6. Changes in prices for commercial properties, 5. Loan rate spread over average federal funds rate, 1987-94 by size of loan, 1987-95:Q1 NOTE. The data are quarterly. through 1994 are quarterly. SOURCE. Federal Reserve Board, statistical release E.2. SOURCE. Liquidity Financial Group, National Real Estate Index. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 551 in 1994. To better understand these and other fund- 7. Selected interest rates, 1987-95:Q1 ing developments, the Federal Reserve conducted a survey on bank liability management in December 1994.3 Banks noted, in particular, the absence of deposit insurance premiums on deposits at foreign branch offices as motivating their decision to borrow in the Eurodollar market. Besides these Eurodollar deposits, a substantial volume of senior bank notes was issued by banks in the domestic market. These instruments have features that make them close substitutes for large certificates of deposit (CDs); but unlike large CDs, they are not subject to deposit insurance premiums. Core deposits declined last year after increasing NOTE. The data are monthly. Rates are at commercial banks. Savings accounts include money market deposit accounts. slightly in 1993. A substantial rise in money mar- SOURCE. Federal Reserve Board, statistical releases H.6 and H.15. ket rates relative to rates on savings and transaction deposits encouraged retail depositors to shift funds to higher-yielding assets, including money market fell slightly from its record level in 1993 because mutual funds (chart 7). Some depositors may also of rapid growth in measured total assets. Some of have turned to direct holdings of securities; one that growth—enough to account for more than half sign of such a shift was the $22 billion rise in net the decline in ROA—reflected the introduction of noncompetitive tenders for Treasury securities.4 In FIN 39. The average return on equity (ROE) also contrast, shifts into bond mutual funds slowed sub- fell last year, as the ratio of annual average equity stantially last year, perhaps as households reacted to assets changed little. to reports of low or negative returns that appeared Profits last year were supported by a substantial as bond prices fell. decline in provisions for loan and lease losses and a A drop in mortgage refinancings contributed to small reduction in net noninterest expense as a the decline in demand deposits and, to a lesser share of assets (table 3). Loss provisions fell to extent, savings deposits. Record levels of mortgage their lowest level in more than a decade because of refinancings had temporarily increased the level of improvements in asset quality resulting from tighter these deposits in 1993 because mortgage servicers lending standards in the early 1990s and the hold prepayments of mortgages securitized by rapid growth of the U.S. economy last year, some government-sponsored agencies in transac- which boosted borrowers' incomes. Net nonintertion and savings accounts before distributing the est expense declined as a share of assets despite a funds to the holders of the securities. sharp drop in trading income from its record level in 1993. The improvement came, in part, from industry efforts to control costs. The positive contributions from reduced provi- TRENDS IN PROFITABILITY sioning and lower net noninterest expense, how- Net income at U.S. commercial banks increased ever, were more than offset by lower income from $1V2 billion in 1994, reaching a record of $44 V2 bil- other sources. Although remaining high by historilion. Despite the higher profits, the industry's ROA cal standards, net interest income declined somewhat as a share of assets, in large part because of the increase in reported assets caused by FIN 39. Higher market interest rates led to losses on sales 3. The banks on the survey panel included many of the banks on the LPS panel, but there were some differences. As of December 31,1994, the combined assets of the panel banks were $1.6 trillion, about 40 percent of domestic commercial bank assets. 4. The Treasury permits noncompetitive bids at its auctions to established at the auction. The level of net noncompetitive tenders make participation easier for smaller bidders. Bidders submitting during a period is the dollar volume of securities purchased under noncompetitive tenders are assured of receiving the security, and noncompetitive tenders less the volume of repayments of maturing the yield on the security they obtain is the average issue rate securities that had been purchased under noncompetitive tenders. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

552 Federal Reserve Bulletin • June 1995 of investment account securities, after three years 8. Stock price indexes, 1990-95:Q1 of substantial gains on such sales. Extraordinary items, which had boosted profits $2 billion in 1993, were inconsequential in 1994. Return on assets dropped most sharply at the ten largest banks, despite their larger-than-average reduction in provisions for loan and lease losses. The decrease in ROA was attributable to the greater dependence of these banks on trading income as well as to the disproportionate effect of FIN 39 on their reported assets. In addition, some of the banks in this category had booked substantial extraordinary gains in 1993 that were not repeated in 1994. Changes in ROA were mixed for the other size NOTE. The data are weekly; the bank indexes run through March 29, 1995, and the S&P 500 runs through March 31, 1995. The bank indexes are categories of banks, with small and large banks for eight money center banks and twenty-one regional banks as defined by posting somewhat lower ROAs and medium-sized Salomon Brothers. SOURCES. Salomon Brothers and Standard and Poor's Corp. banks showing a moderate increase. On balance, share prices for publicly traded bank cerns about bank derivative positions caused bank holding companies underperformed the broader equity prices over the second half of the year to market last year (chart 8). Early in the year, continmore than reverse earlier gains. ued profitability and strong loan growth boosted prices of bank stocks, especially those of regional banks. Despite strong profits, however, fears that Loss Provisions and Asset Quality higher interest rates would squeeze interest margins and erode trading profits and increased con- In 1994, bank asset quality improved substantially. Delinquent loans and leases (those that are more than thirty days past due or that are on nonaccrual status) fell below 3 percent of outstanding loans Selected income and expense items, by size of bank, 1991-94 and leases, less than half the peak rate in 1991 Percent (table 4). Similarly, charge-off rates fell sharply, reaching their lowest levels in more than a decade. mm Net Net Year and size interest noninterest Loss Delinquency and charge-off rates fell the most at of bank provisions income expense the ten largest banks, but these banks continued to 1994 have higher rates than banks in the other size All banks 1.15 3.78 1.75 .28 Small 1.16 4.36 2.48 .19 categories. Delinquency rates at medium-sized and Medium 1.29 4.26 1.92 • .32 Large lfl 3.77 1.60 .32 at large banks also improved substantially and were Ten largest... 2.86 1.23 .26 below the rate at small banks for the first time in 1993 seven years. All banks 1.20 | 3.90 1.81 .47 Small 1.19 4.33 2.48 .27 Delinquency and charge-off rates fell the most Medium 1.22 4.26 2.07 .47 for business and real estate loans and less for Large 1.26 3.85 1.66 .47 Ten larjicst 1.13 3.16 1.14 .64 consumer loans (chart 9). In part, these decreases 1992 resulted from the substantial growth in loans last Ail banks . .91 3.89 1.91 .78 year, since newly extended loans are unlikely to be Small... 1.04 4.34 2.51 .42 Medium .92 4.20 2.18 .77 delinquent. The substantial drops in real estate Large. 1.04 3.86 1.73 .78 .61 3.15 1.27 1.12 delinquencies and charge-ofifs presumably also reflected the improved commercial real estate mar- 1991 All banks . .53 3.60 1.93 1.02 kets noted above and banks' efforts to sell troubled Small... .78 4.09 2.52 .51 Medium .61 3.95 2.11 1.06 real estate loans. Large. .51 3.40 1.69 1.19 .22 2.95 1.43 1.21 Another factor that contributed to the improved quality of business and real estate loan portfolios NOTE. Percentage of average net consolidated assets. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 553 4. Measures of loan quality, by size of bank, 1991-94 end of the year, this ratio reached almost 90 per- Percent cent, double its level four years earlier. Given substantial improvement in asset quality and ample 1994 9. Delinquency and charge-off rates, by type of loan, All banks . 1987-94 Small .. Medium ... Large Ten largest 1993 All banks .... Small Medium ... Large Ten largest 1.20 5.76 1992 All banks .... 1.29 5.35 Small .61 3.90 Medium ... 1.19 4.55 Large 1.37 5.23 Ten largest 1.87 7.68 banks .... 1.59 6.03 !S mall .77 4.41 Medium ... 1.43 5.28 Large 1,67 6.13 Ten largest 2.38 8.21 NOTE. Percentage of outstanding loans. 1. Delinquent loans are nonaccrual loans and those that are accruing interest but are more than thirty days past due. was the tightening of bank lending standards in the early 1990s. With the increased willingness of banks to make loans in recent years, however, delinquency and charge-off rates may not fall much further. Indeed, according to fourth-quarter data, NOTE. The data are quarterly and seasonally adjusted. 1. Delinquent loans are nonaccrual loans and those accruing interest but the delinquency rate for consumer loans may be more than thirty days past due. The delinquency rate for a category of loans leveling out. A slowing of the economic expansion is the category's average level of delinquent loans for the period divided by the category's average level of outstanding loans for the period. The first from its rapid 1994 pace would also make addi- period plotted is 1987:Q2. tional improvements in asset quality difficult to 2. The charge-off rate for a category of loans is the category's annualized charge-offs for the period, net of recoveries, divided by the category's achieve. average level of outstanding loans for the period. With delinquency and charge-off rates down substantially from their elevated levels of recent years, provisions for loan and lease losses dropped 10. Reserves for loan and lease losses, loss provisions, and net charge-offs as a percentage of loans, 1980-94 sharply last year and reached their lowest level in more than a decade. The ten largest banks posted Reserves for loan and lease losses the biggest decline in provisioning as a fraction of loans and leases. Provisioning by the largest banks was below the rates at medium-sized and large banks for the first time in three years. For the industry as a whole, provisioning was less than charge-offs last year, causing a small decline in reserves. With growth in loans and leases picking up, the ratio of reserves to loans and leases outstanding fell to less than 2.5 percent (chart 10). Nonetheless, reserves as a fraction of delinquent loans and leases increased substantially, and by the NOTE. The data are annual. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

554 Federal Reserve Bulletin • June 1995 reserves, more than 750 banks actually posted Net interest income as a share of average negative provisions for the year. Doing so directly interest-earning assets, or the net interest margin, reduced reserves at these banks and boosted their fell slightly from its 1993 level, but it remained reported profits nearly $600 million; negative pro- close to 4.4 percent last year, a high level by visions had accounted for about $375 million of historical standards. On a quarterly basis, the net profits in 1993. interest margin rebounded in the final three quarters of the year after declining from its peak of just more than 4.5 percent at an annual rate in the Interest Income and Expense fourth quarter of 1992 to less than 4.3 percent in the first quarter of 1994. Interest margins appear Despite the increase in market rates last year, both not to have been significantly affected by the stabigross interest income and gross interest expense lization in Brazil. declined moderately as a percentage of interest- Net margins, which had been expected to narrow earning assets (table 5). In part, these reductions as interest rates increased, remained wide because likely reflected earlier decreases in interest rates, as of two factors. First, banks increased loans, which banks replaced maturing assets and liabilities with generally earn higher interest rates than securities lower-yielding instruments. This effect was bol- do, as a share of interest-earning assets. Because of stered by the relatively slow adjustment of the rates the strength in loan demand last year, banks were paid on some types of deposits and charged on able to achieve this shift in asset competition withsome types of loans to movements in market rates. out sharp declines in spreads of loan interest As a result of these factors, both interest income and interest expense decreased substantially as a percentage of assets in the first quarter, before 11. Interest income, interest expense, and net interest rebounding moderately in the second. income, as a percentage of average interest-earning Also contributing to the year-over-year decreases assets, by size of bank, 1985-94 was the sharp drop in nominal interest rates in Brazil after that country implemented a stabilization program at midyear. Although only a few large banks with significant operations in Brazil were affected by the stabilization, the effects were surprisingly large, cutting quarterly gross interest income and expense by roughly $3 billion between the second and third quarters. As a result, in the third quarter gross interest income for all commercial banks was about unchanged, and gross interest expense actually fell. Indeed, if the levels of interest income and expense from Brazilian operations had been the same in the second half of the year as they had been in the first, gross interest income and expense as a share of interest-earning assets would have increased rather than decreased in 1994. 5. Interest income, interest expense, and net interest income, 1991-94 Percent NOTE. Percentage of average net consolidated interest-earning assets. NOTE. The data are annual. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 555 rates over market rates. Second, rates on small time 6. Noninterest income, noninterest expense, deposits lagged increases in market rates by some- and net noninterest expense, 1991-94 what more than they generally had in the past. The Percent effect of this relatively unaggressive pricing of Item 1991 1992 1993 1994 small time deposits on net interest margins was damped to some degree, however, by the resulting Noninterest income 1.80 1.95 2.12 1.99 Noninterest expense ....... 3.73 3.86 3.93 3.74 need to increase funding from other sources, Net noninterest expense .... 1.93 1.91 1.81 1.75 including relatively expensive managed liabilities. NOTE. Percentage of average net consolidated assets. The pattern of interest income, expense, and net interest margin across size categories of banks ing almost a half in 1993.5 The notional principal changed little last year (chart 11). Among the four value of foreign-exchange contracts (including the size groups, the ten largest banks had the highest value of exchange rate swaps, commitments to buy level of interest income relative to interest-earning foreign exchange, and option contracts) increased a assets. However, because of their relative lack of quarter in 1994 following an 18 percent rise the core deposits and their greater reliance on managed previous year. The bulk of the increase in derivaliabilities, the largest banks also had the highest tives activity last year came in the first half. In the interest expense relative to interest-earning assets. second half, growth in interest rate contracts On balance, the largest banks had the lowest averslowed considerably, and foreign exchange conage net interest margin. The levels of average intertracts actually declined. est expense were quite similar among the other size Despite the large increase in notional principal groups. Because of their higher returns on loans, values, the credit-equivalent value of interest rate small and medium-sized banks earned somewhat and exchange rate contracts increased only higher interest income as a fraction of interest- IOV2 percent last year, to $225 billion.6 The credit earning assets. Thus, their average net interest marequivalent value of interest rate contracts actually gins were higher than the average margin of the declined 6 percent, as higher interest rates reduced large banks. the market value of contracts that had increased in value as rates fell in 1993. By contrast, the credit equivalent value of foreign exchange contracts Noninterest Income and Expense increased 23 percent, as a sharp rise in the second quarter, likely reflecting the decline in the value of Net noninterest expense increased to $68 billion in the dollar, was only partially reversed later in the 1994 from $65 billion a year earlier. The primary year. cause of the increase was a substantial decline in Although commercial banks' net noninterest trading income, which dropped $3 billion followexpense increased last year, rapid growth in assets ing a record year in 1993. The decrease reflected led to a decline in net noninterest expense as a weaker proprietary trading results at several banks share of assets from 1.81 percent to 1.75 percent with large trading operations. In addition, earnings (table 6). Much of this improvement, however, was from foreign exchange trading, a large part of the arithmetic result of the boost in measured assets which are derived from market-making activities, caused by FIN 39. In addition, the industry benefell because of a narrowing of bid-ask spreads in foreign exchange markets. Trading income was reportedly also hurt by a decline in demand for more complex derivatives 5. The notional principal value of a contract is a value used in the calculation of the payments owed. It does not represent the contracts, which carry higher fees than simpler amount subject to credit risk, nor does it reflect the extent to which contracts do. Nonetheless, overall activity in de- contracts are offsetting. (» rivatives continued to expand rapidly last year. The 6. The credit equivalent value of an off-balance-sheet derivative contract is an estimate of the credit exposure of the contract that is notional principal value of banks' interest rate conintended to be comparable to the on-balance-sheet credit exposure tracts (including the value of interest rate swaps, created by a loan. The estimate is the sum of the current exposure futures contracts, forward contracts, and option (the replacement cost if positive, otherwise zero) and an estimate of the potential future increase in credit exposure (a small fraction of contracts) expanded more than one-third after risthe notional principal value of the contract). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

556 Federal Reserve Bulletin • June 1995 12. Noninterest income, noninterest expense, and net other noninterest expenses as a share of assets. By noninterest expense as a percentage of average contrast, small banks reported slightly higher nonassets, by size of bank, 1985-94 interest expenses, and their net noninterest expense was little changed as a share of assets. Changes in Capital Despite the record level of net income last year, bank capital increased less than half as much as it had in each of the previous two years (table 7). A substantial increase in dividends pared retained earnings by nearly a quarter; and SFAS 115, which implemented mark-to-market rules on availablefor-sale securities last year, reduced equity capital nearly $11 billion as securities prices fell. In addition, sales of shares (both to the market and to parent holding companies) and increases in capital resulting from other transactions with parent companies declined last year. Indeed, some bank holding companies, finding that they had more capital than they considered to be optimal, undertook share repurchase programs. 7. Retained income and change in total equity capital, by size of bank, 1991-94 Billions of dollars except as noted Item and size of bank 1991 1992 1993 1994 fited from successful efforts to contain expenses. ^ ^^ Retained income These efforts led to a decline in employment and 2.8 17.1 20.9 16.4 Small 2.1 3.7 4.4 3.9 the first decrease in salaries, wages, and employee Medium 3 4.3 4.2 5.0 benefits as a share of assets since 1988. Other A 5.9 5.3 4.4 Ten largest .1 3.3 7.0 3.1 noninterest expenses also fell, partly because of Net change in equity capital1 lower costs associated with foreclosed properties, All banks 12.9 31.7 33.0 15.4 4.2 5.5 7.0 3.1 owing to earlier reductions in such holdings, as 4.0 7.6 8.4 5.4 well as the improvement in commercial real estate 4.5 8.6 8.0 3.6 TTeenn llaarrggeesstt .2 10.1 9.6 3.3 markets. BMBBIMI LLI Net percentage change Changes in net noninterest expense as a share of in equity capital1 assets were mixed across size categories last year 5.92 13.75 12.59 5.22 7.18 9.20 11.56 ' 4.83 (chart 12). The ratio was higher at the ten largest Medium 6.07 10.97 11.22 6.45 7.72 13.43 10.39 4.12 banks because of their greater dependence on trad- Ten largest .58 25.94 19.13 5.51 ing and foreign-exchange-related activities, both of Percentage change in equity which fared badly. Results for these banks were capital attributable to retained incomei greatly affected by FIN 39, without which their net All banks 21.95 53.98 63.35 106.34 Small 50.41 67.21 62.57 128.69 noninterest expense as a share of assets would have Medium 6.50 56.49 50.00 92.41 increased more than twice as much. Medium-sized 9.04 68.21 67.06 119.59 Tea largest 32.52 32.91 72.49 93.86 and large banks showed improvements in net non- 1. Data are from year-end to year-end and are calculated from quarterly interest expense last year because of declines in merger-adjusted changes. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 557 With assets growing rapidly (in part as a result of to 90 percent by year-end, up from 82 percent a FIN 39), the ratio of equity capital to total assets year earlier and just 30 percent at the end of 1990. decreased 21 basis points, to 7.79 percent, between the end of 1993 and the end of 1994. Equity capital as a fraction of assets declined for the larger banks DEVELOPMENTS IN 1995 and was little changed at the smaller banks. The decline at the ten largest banks was entirely the Data available in the first several months of 1995 result of the effect of FIN 39 on reported assets, suggested that the pace of the economic expansion without which the ratio would have increased. By was likely slowing. The slowdown reduced, if not contrast, the large bank category, which was far eliminated, market expectations of near-term interless influenced by FIN 39, showed a decline in est rate hikes. As fears that higher market interest capital relative to assets because assets increased rates would squeeze bank net interest margins by a relatively large amount over the year. For the abated, bank stock prices rose strongly. Late in the medium-sized and small bank groups, capital-asset first quarter, however, the equity prices of banks ratios were about unchanged. Evidently, increases with large operations in Mexico or other Latin due to retained earnings, share issuance, and capi- American countries declined for a time, reportedly tal infusions were nearly offset by decreases reflect- because of investor concerns about the implicaing asset growth and the mark-to-market provisions tions for these banks of the financial crisis in ofSFAS 115. Mexico. Regulatory capital ratios declined slightly last Bank balance sheet trends in the first quarter year after increasing steadily over the previous four appeared to be broadly similar to those in the years (chart 13).7 As noted in the box, the risk- second half of 1994. Loans at the domestic offices based ratios were unaffected by SFAS 115 and FIN 39. Their small decrease was the result of 13. Regulatory capital ratios, by size of bank, 1990-94 relatively rapid growth in risk-weighted assets. In part, this growth reflected the change in the distribution of bank assets last year, as securities declined and loans, which generally carry higher risk weights, grew rapidly. By contrast, leverage ratios, which are calculated based on average assets, were depressed by the adoption of FIN 39 in the first quarter, especially at the largest banks. Despite the decline in regulatory capital ratios, the fraction of industry assets at well-capitalized banks—adjusted for bank examiners' ratings—rose 7. The agencies' risk-based capital guidelines are based on the Basle Accord and were modified by the Federal Deposit Insurance Corporation Improvement Act of 1991. Tier 1 capital includes mainly common equity and certain perpetual preferred stock. Tier 2 capital consists primarily of subordinated debt, non-tier-1 preferred stock, and loan-loss reserves. Risk-weighted assets are calculated by multiplying the amount of assets and the credit equivalent amount of off-balance-sheet items in each risk-weight category by a factor accounting for the credit risk of that category. U.S. regulators also consider the leverage ratio, which is defined to be tier 1 capital as a percentage of average total consolidated assets, when deciding on various supervisory and regulatory issues affecting a bank. For a summary of the evolution of risk-based capital standards, see Allan D. Brunner and William B. English, "Profits and Balance Sheet Developments at U.S. Commercial Banks in 1992," Federal NOTE. The data are quarterly. For definitions of tier 1 and tier 2 capital Reserve Bulletin, vol. 79 (July 1993), pp. 661-62. and leverage capital, see text note 7. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

558 Federal Reserve Bulletin • June 1995 of U.S. commercial banks continued to expand, purchases of consumer durables. On the liability while security holdings declined. In contrast to side, core deposit growth remained sluggish, as 1994, the most rapidly growing loan component in banks continued to fund much of their loan growth the first quarter was commercial and industrial with sales of securities and managed liabilities. loans. The LPS conducted in February showed Bank profitability likely remained near last some additional easing of terms and standards for year's elevated level in the first quarter. While net such loans, and a further pickup in demand to interest margins reportedly narrowed in many finance inventories, equipment purchases, and cases, profits were buoyed by rapid loan growth mergers and aquisitions. By contrast, consumer and continued low levels of provisioning. Trading loan growth slowed relative to its pace in 1994, a results were mixed and likely remained fairly weak development that likely reflected a slowdown in on balance. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 559 A.l. Report of income, all insured domestic commercial banks and nondeposit trust companies, 1985-94 Millions of dollars 256,394 244,438 256,809 320,732 323,814 292,809 259,516 247,453 259,710 237,289 238,543 214,033 185,936 178,183 189,566 46,637 50,949 52,571 51,807 48,622 48,239 repurchase agreements iross interest expense 157,126 143,096 122,457 105,485 110,745 Deposits 130,651 117,740 98,726 79,383 79,009 Gross federal funds purchased and repurchase agreements 18,621 22,755 8,437 12,477 Other 16,913 20,697 17,665 19,261 Net interest income 133,937 Taxable equivalent 137,059 Loss provisions1 16,735 10,922 Noninterest income 51,555 55,694 60,887 67,045 75,765 76,976 Service charges on deposits 10,235 11,419 12,818 14,120 14,870 15,267 Income from fiduciary activities 8,297 8,879 9,466 10,446 11,164 12,057 Foreign-exchange gains and fees 2,231 2,816 2,623 3,347 3,231 2,072 Trading income 1,817 2,038 3,326 2,927 6,017 4,178 Other 28,974 30,542 32,654 36,203 40,483 43,403 Noninterest expense 82.480 90,659 116,415 144,590 Salaries, wages, and employee benefits 40,051 43,116 52,029 60,756 Expenses of premises and fixed assets 13,328 14,575 17,517 18,931 Other 29,102 32,967 46,869 64,903 Net noninterest expense 56,476 65,085 Realized gains on investment account securities Income before taxes and extraordinary items 33,660 66,959 Taxes 10,015 22,421 Extraordinary items 809 -19 Net income 2,527 24,456 17,933 42,966 44,521 Cash dividends declared 10,652 13,267 15,101 22,045 28,126 Retained income -8,125 11,191 2,831 20,921 16,395 1. Includes provision for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

560 Federal Reserve Bulletin • June 1995 A.2. Portfolio composition, interest rates, and income and expense, all insured domestic commercial banks and nondeposit trust companies, 1985-94 A. All banks Item 1985 1986 1 1987 1988 1989 1990 1991 1992 1993 1994 Balance sheet items as a percentage of average net consolidated assets Interest-earning assets 86.68 87.11 87.48 88.00 87.93 87.81 88.03 88.33 88.50 86.60 Loans and leases, net 59.59 59.09 59.12 59.80 60.64 60.52 59.54 57.30 56.25 56.07 Commercial and industrial 22.16 20.87 19.98 19.50 19.09 18.50 17.33 15.78 14.88 14.51 U.S. addressees 17.41 16.84 16.57 16.55 16.54 15.99 15.00 13.54 12.72 12.36 Foreign addressees 4.75 4.02 3.41 2.95 2.55 2.51 2.33 2.24 2.16 2.16 Consumer 11.04 11.38 11.42 11.71 11.89 11.77 11.45 11.02 11.00 11.43 Credit card 2.63 2.98 3.17 3.47 3.69 3.78 3.88 3.82 3.89 4.21 Installment and other 8.41 8.40 - 8.26 8.25 8.20 7.99 7.57 7.20 7.11 7.22 15 88 16 90 1900 20 86 22 50 23 86 24 86 24 87 24 81 24 43 In domestic offices 15.42 16.35 18.40 20.18 21.78 23.10 24.10 24.18 24.19 23.80 Construction and land development 3.22 3.51 3.90 4.06 4.16 4.00 3.41 2.64 1.99 1.65 Farmland .41 .44 .47 .49 .51 .51 .53 .56 .57 .56 One- to four-family residential 7.31 7.45 8.22 9.21 10.15 11.20 12.27 12.91 13.49 13.74 Home equity n.a. n.a. n.a. 1.14 1.42 1.67 1.95 2.09 2.07 1.91 Other n.a. n.a. n.a. 8.07 8,73 9.54 10.32 10.82 11.42 11.84 Multifamily residential .45 .50 .57 .59 .60 .63 .66 .75 .79 .79 Nonfarm nonresidential 4.03 4.45 5.25 5.83 6.36 6.76 7.23 7.32 7.33 7.06 In foreign offices .46 .55 .60 .68 .72 .76 .76 .69 .62 .63 Depository institutions 2.66 2.38 2.28 2.04 1.76 1.60 1.42 1.24 1.07 1.42 Foreign governments 1.56 1.43 1.35 1.22 1.03 .78 .75 .73 : .67 .41 Agricultural production 1.53 1.23 1.04 .98 .96 .95 1.01 1.02 .99 1.00 Other loans 5.43 5.51 4.98 4.52 4.31 3.93 3.60 3.50 3.56 3.34 Lease-financing receivables .84 .91 .98 1.06 1.10 1.12 1.09 1.03 .99 1.03 LESS: Unearned income on loans .71 .60 .52 .50 .48 .42 .36 .28 .21 .16 LESS: Loss reserves1 .81 .94 1.40 1.61 1.52 1.57 1.62 1.60 1.51 1.36 Securities 16.84 17.85 18.34 18.45 18.38 19.09 20.69 23.52 25.37 24.31 Investment account 15.62 16.28 17.00 17.17 17.13 17.63 18.93 21.18 22.50 21.60 Debt 15.62 16.28 17.00 17.17 16.84 17.36 18.62 20.82 22.12 21.21 U.S. Treasury 6.84 6.24 6.02 5.60 4.98 4.57 5.06 6.49 7.07 6.77 U.S. government agency and corporation obligations 2.80 3.07 4.14 4.88 6.03 7.56 8.74 9.86 10.73 10.24 Mortgage pass-through securities .96 1.13 2.10 2.59 3.27 4.08 4.51 4.52 4.74 4.67 Collateralized mortgage obligations .. n.a. n.a. n.a. n.a. JUL 1.28 2.07 3.12 3.72 3.24 Other 1.84 1.94 2.04 2.29 2.77 2.20 2.16 2.21 2.27 2.33 State and local government • 4.87 5.37 4.40 3.69 3.14 2.64 2.28 2.08 2.06 2.01 Other 1.10 1.62 2.44 2.99 2.69 2.59 2.53 2.40 2.25 2.18 Equity2 a.a. n.a. n.a. n.a. .29 .27 .31 .37 .38 .39 Trading account 1.22 1.56 1.34 1.28 1.25 1.46 » 1.77 2.34 2.87 2.71 Gross federal funds sold and reverse RPs 4.48 4.82 4.57 4.55 4.33 4.46 4.58 4.54 4.27 3.82 Interest-bearing balances at depositories 5.77 5.35 5.45 5.21 4.58 3.74 3.21 2.97 2.62 2.40 Non-interest-earning assets 13.32 12.89 12.52 12.00 12.07 12.19 11.97 11.67 11.50 13.40 Liabilities 93.74 93.69 93.83 93.84 93.63 93.59 93.33 92.82 92.15 92.12 Interest-bearing liabilities 72.85 73.13 74.03 75.40 76.02 76.53 76.58 75.32 73.93 71.86 Deposits 61.52 60.63 61.26 62.06 62.56 63.42 64.44 62.93 60.26 57.35 In foreign offices 12.28 11.27 11.02 10.41 9.68 9.25 8.55 8.37 8.32 9.39 In domestic offices 49.24 49.36 50.24 51.65 52.88 54.17 55.89 54.56 51.94 47.96 Other checkable deposits 4.58 5.19 6.04 6.25 6.12 6.19 6.72 7.65 8.24 7.80 Savings (including MMDAs) 16.45 17.46 18.28 17.60 16.27 16.58 17.98 20.27 20.90 19.60 Small denomination time deposits 16.78 15.85 15.06 16.25 18.37 19.% 21.29 19.21 16.98 15.33 Large denomination time deposits 11.43 10.86 10.86 11.55 12.12 11.43 9.90 7.42 5.81 5.23 Gross federal funds purchased and RPs 7.72 8.31 8.13 8.02 8.22 8.03 7.09 7.02 7.47 7.60 Other 3.61 4.19 4.64 5.31 5.24 5.08 5.04 5.37 6.19 6.91 Non-interest-bearing liabilities 20.88 20.56 19.80 18.44 17.61 17.06 16.75 17.50 18.22 20.26 Demand deposits in domestic offices 15.51 15.89 15.34 14.25 13.48 12.79 12.58 13.24 13.86 13.49 Other 5.37 4.67 4.46 4.20 4.13 4.27 4.17 4.27 . 4.37 6.77 Capital account 6.27 6.31 6.17 6.16 6.37 6.41 6.67 7.18 7.85 7.88 MEMO Commercial real estate loans n.a. n.a. n.a. n.a. n.a. n.a. 11.37 10.60 9.84 9.15 Other real estate owned .26 .30 .35 .39 .40 .51 .76 .82 .63 .36 35.49 35.07 35.13 35.74 35.71 34.25 31.01 28.65 28.23 29.57 • (billions of dollars) 2,573 2,775 2,922 3,048 3,188 3,339 3,380 3,442 3,566 3,863 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 561 A.2.—Continued A. All banks Item 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Effective interest rate (percent)3 Rates earned Interest-earning assets 11.12 9.90 9.42 9.99 11.11 10.66 9.53 8.27 7.60 7.60 Taxable equivalent 11.63 10.43 9.66 10.20 11.27 10.79 9.65 8.38 7.71 7.69 Loans and leases, gross 11.98 10.80 10.22 10.79 11.99 11.47 10.36 9.19 8.67 8.61 Net of loss provisions 10.82 9.43 8.08 9.86 10.43 9.92 8.69 7.87 7.86 8.12 Securities 9.44 8.44 8.09 8.35 8.71 8.78 8.16 7.03 6.07 5.96 Taxable equivalent 11.04 10.09 8.96 9.05 9.26 9.21 8.54 7.35 6.36 6.21 Investment account 9.39 8.50 7.94 8.03 8.54 8.66 8.22 7.11 6.06 5.78 U.S. government and other debt 10.45 9.14 8.18 8-21 8.78 8.91 8.39 7.17 6.06 5.79 State and local 7.03 7.19 7.26 7.37 7.44 7.37 7.25 6.81 6.26 5.87 Equity2 nj. n.a. n.a. n.a. 7.73 7.32 6.19 5.31 4.77 4.79 Trading account 10.11 7.83 10.01 12.63 11.11 10.15 7.52 6.40 6.16 7.41 Gross federal funds sold and reverse RPs 8.12 6.69 6.56 7.33 9.12 8.06 5.67 3.58 3.03 4.24 Interest-bearing balances at depositories 9.47 7.86 7.55 8.69 10.58 9.96 8.43 7.31 6.61 5.71 Rates paid Interest-bearing liabilities 8.49 7.17 6.75 7.22 8.50 8.03 66..5511 44..7755 44..0011 44..0011 Interest-bearing deposits 8.18 6.93 6.38 6.81 7.85 7.56 6.31 4.50 3.64 3.53 In foreign offices 9.48 7.79 7.90 8.90 10.87 10.71 8.54 7.32 6.82 5.59 In domestic offices 7.87 6.75 6.04 6.39 7.30 7.00 5.97 4.07 3.14 3.14 Other checkable deposits n.a. n.a. 4.54 4.74 4.82 4.78 4.32 2.69 1.98 1.85 Savings (including MMDAs) n.a. n.a. 5.28 5.52 6.17 5.98 5.08 3.25 2.49 2.57 Large denomination CDs 8.73 7.34 6.86 7.37 8.62 8.02 6.66 4.89 3.98 4.09 Other time deposits n.a. n.a. 6.97 7.28 8.27 7.96 6.88 5.14 4.18 4.17 Gross federal ftmds purchased and RPs 7.97 6.78 6.51 7.30 9.18 7.96 5.73 3.64 3.07 4.19 Income and expenses as a percentage of average net consolidated assets Gross interest income 9.63 8.58 8.38 8.94 9.92 9.58 8.56 7.45 6.85 6.65 Taxable equivalent 10.07 9.03 8.59 9.12 10.06 9.70 8.66 754 6.94 6.72 Loans 7.13 6.34 6.17 6.61 7.44 7.14 6.33 5.40 5.00 4.91 Securities 1.47 1.38 1.35 1.38 1.46 1.53 1.56 1.51 1.36 1.25 Gross federal funds sold and reverse RPs .37 .33 .31 .34 .41 .38 .27 .17 .13 .17 Other .67 .53 .54 .60 .61 .54 .41 .37 .36 .33 Gross interest expense 6.11 5.16 4.96 5.41 6.42 6.13 4.96 3.56 2.96 2.87 Deposits 5.08 4.24 3.96 4.25 4.93 4.83 4.11 2.87 2.23 2.05 Gross federal funds purchased and RPs .64 .57 .54 .61 .78 .68 .43 .27 .24 .32 I .38 .34 .46 .55 .71 .62 .43 .42 .50 .50 Net interest income 3.53 3.42 3.42 3.52 3.51 3,45 3.60 3.89 3.90 3.78 Taxable equivalent | 3.96 3.87 3.63 3.71 3.64 3.57 3.70 3.98 3.98 3.86 Loss provisions4 .69 .80 1.29 .57 .97 .97 1.02 .78 .47 .28 Noninterest income 1.22 1.31 1.43 1.49 1.62 1.67 1.80 1.95 2.12 1.99 Service charges on deposits .29 .29 .30 .31 .32 .34 .38 .41 .42 .40 Income from fiduciary activities .21 .23 .24 .24 .26 .27 .28 .30 .31 .31 Foreign-exchange gains and fees .06 .06 .09 .07 .07 .08 .08 .10 .09 .05 Trading income .03 .05 .04 .05 .06 .06 .10 .09 .17 .11 Other .62 .69 .77 .82 .91 .91 .97 1.05 1.14 1.12 Noninterest expense 3.21 3.27 3.34 3.35 3.41 3.49 3.73 3.86 3.93 3.74 Salaries, wages, and employee benefits 1.56 1.55 1.55 1.54 1.55 1.56 1.58 1.61 1.64 1.57 Expenses of premises and fixed assets .52 .53 .52 .52 .52 .52 .53 .53 .52 ,,4499 Other 1.13 1.19 1.27 1.29 1.34 1.40 1.61 1.72 1.77 11..6688 !! Net noninterest expense 1.99 1.96 1.91 1.85 1.79 1 82 1.93 1.91 1.81 1.75 Realized gains on investment account securities .. .06 .14 .05 .01 .02 .01 .09 .12 .09 -.01 Income before taxes and extraordinary items .90 .80 .26 1.10 .77 .68 .75 1.32 1.70 1.73 Taxes .22 .19 .19 .33 .30 .23 .24 .42 .56 .58 Extraordinary items .01 .01 .01 .03 .01 .02 .03 .01 .06 * Net income .69 .62 .09 .80 .48 .47 .53 .91 1.20 1.15 Cash dividends declared .33 .33 .36 .44 .44 .42 .45 .41 .62 .73 Retained income .36 .29 -.28 .37 .04 .05 .08 .50 .59 .42 MEMO: Return on equity 11.08 9.87 1.40 13.04 7.55 7.36 7.95 12.68 15.35 14.63 * In absolute value, less than 0.005 percent. NOTE. For definitions of managed liabilities and commercial real estate loans, see text table 2, notes 1 and 2. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserve. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Where possible, based on an average of quarterly average balance sheet data reported on schedule RC-K of the quarterly Call Report. 4. Includes provision for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

562 Federal Reserve Bulletin • June 1995 A.2. Portfolio composition, interest rates, and income and expense, all insured domestic commercial banks and nondeposit trust companies, 1985-94 B. Ten largest banks by assets Item 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Balance sheet items as a percentage of average net consolidated assets Interest-earning assets 84.33 85.08 85.14 85.22 85.16 84.85 85.41 85.16 84.79 77.16 Loans and leases, net 63.11 61.45 59.36 58.69 59.66 61.69 62.14 58.34 55.57 49.91 Commercial and industrial 30.68 26.68 24.53 23.36 22.61 22.91 22.42 20.32 18.65 16.43 U.S. addressees 15.33 13.74 13.31 13.01 13.18 13.39 13.44 12.00 10.75 9.16 Foreign addressees 15.35 12.95 11.22 10.36 9.43 9.53 8.97 8.32 7.90 7.27 Consumer 5.62 6.50 6.41 6.19 6.21 6.87 7.20 7.31 7.33 6.59 Credit card 2.14 2.46 2.34 2.08 1.99 2.20 2.53 2.61 2.50 2.28 Installment and other 3.49 4.03 4.07 4.10 4.22 4.67 4.67 4.70 4.83 4.31 Real estate 10.37 12.30 13.97 15.46 18.02 20.56 21.68 19.93 18.54 16.21 In domestic offices 8.67 10.22 11 69 12 80 15 05 17 36 18 37 17 07 15 99 13 80 Construction and land development 2.24 2.67 3.21 3.48 3.60 3.79 3.42 2.48 1.59 .84 Farmland .07 .07 .06 .06 .08 .08 .08 .07 .07 .06 One-to four-family residential 4.10 4.76 5.17 5.83 7.45 9.31 10.34 10.08 10.29 9.69 Home equity n.a. n.a. n.a. .76 1.04 1.31 1.63 1.63 1.60 1.40 Other n.a. n.a. n.a. 5.07 6.41 8.00 8.71 8.46 8.68 8.29 Multifamily residential .41 .48 .61 .65 .68 .68 .57 .58 .53 .41 Nonfann nonresidential 1.85 2.24 2.63 2.78 3.23 3.51 3.95 3.86 3.51 2.79 In foreign offices 1.71 2.07 2.28 2.66 2.97 3.20 3.32 2.85 2.55 2.41 Depository institutions 5.29 5.01 5.18 5.21 4.56 3.64 3.05 2.56 2.35 3.37 Foreign governments 3.94 3.77 3.64 3.63 3.34 2.76 2.88 2.75 2.46 1.27 Agricultural production .48 .42 .36 .33 .31 .31 .31 .28 .27 .25 Other loans 6.67 6.85 6.51 6.23 6.36 6.05 5.61 6.05 6.82 6.44 Lease-financing receivables 1.29 1.37 1.38 1.44 1.49 1.60 1.68 1.51 1.30 1.14 LESS: Unearned income on loans .36 .39 .41 .43 .45 .39 .35 .27 .21 .16 LESS: Loss reserves' .87 1.06 2.22 2.74 2.77 2.63 2.34 2.08 1.94 1.63 Securities 9.29 11.71 12.59 12.96 13.13 14.03 15.58 19.13 22.74 20.61 Investment account 5.75 6.91 8.19 8.67 9.05 9.22 9.38 10.70 12.45 11.68 Debt 5.75 6.91 8.19 8.67 8.83 8.98 9.08 10.36 12.08 11.30 U.S. Treasury 1.89 1.60 1.47 1.41 1.29 1.09 1.35 2.30 2.39 2.17 U.S. government agency and corporation obligations .55 .68 1.54 1.94 2.29 2.91 3.46 4.45 6.14 5.16 Mortgage pass-through securities .46 .59 1.47 1.84 2.07 2.24 2.26 2.43 3.30 2.79 Collateralized mortgage obligations .. n.a. n.a. n.a. n.a. n.a. .55 1.12 1.97 2.76 2.31 Other .09 .09 .07 .10 .22 .13 .08 .05 .08 .06 State and local government 1.53 1.99 1.93 1.80 1.58 1.08 .77 .66 .59 .60 Other 1.78 2.64 3.25 3.52 3.68 3.90 3.50 2.95 2.97 3.37 Equity2 n.a. n.a. n.a. n.a. .22 .24 .30 .33 .36 .38 Trading account 3.55 4.80 4.40 4.29 4.08 4.81 6.19 8.43 10.30 8.93 Gross federal funds sold and reverse RPs 3.53 3.57 3.91 4.61 4.12 2.88 2.96 3.23 2.71 2.68 Interest-bearing balances at depositories 8.39 8.35 9.28 8.97 8.26 6.25 4.74 4.45 3.76 3.95 Non-interest-earning assets 15.67 14.92 14.86 14.78 14.84 15.15 14.59 14.84 15.21 22.84 Liabilities 95.18 95.13 95.58 95.41 95.11 95.29 94.97 94.44 93.24 93.42 Interest-bearing liabilities 72.45 72.61 73.08 73.76 74.17 73.97 74.62 73.08 71.56 64.33 Deposits 57.44 56.56 57.46 57.67 57.56 57.95 57.67 55.73 52.91 48.20 In foreign offices 34.60 32.43 32.60 31.49 30.08 29.66 28.47 27.16 25.51 26.10 In domestic offices 22.85 24.14 24.86 26.18 27.49 28.28 29.19 28.56 27.41 22.10 Other checkable deposits 1.27 1.89 2.45 2.68 2.70 2.74 3.00 3.38 3.45 2.91 Savings (including MMDAs) 8.81 10.32 11.04 11.42 11.32 12.05 13.50 14.91 15.33 12.70 Small denomination time deposits 4.65 4.59 4.55 5.03 5.64 6.16 6.55 5.72 5,09 3.98 Large denomination time deposits 8.12 7.34 6.82 7.05 7.82 7.33 6.14 4.56 3.53 2.51 Gross federal funds purchased and RPs 7.95 8.08 6.89 6.40 6.72 6.90 6.80 6.19 6.70 5.83 Other 7.06 7.96 8.74 9.69 9.89 9.13 10.15 11.16 11.94 10.29 Non-interest-bearing liabilities . 22.72 22.52 22.50 21.65 20.94 21.32 20.35 21.36 21.68 29.09 Demand deposits in domestic offices 11.34 12.55 12.64 11.93 11.60 10.93 10.36 11.05 11.27 10.15 Other 11.38 9.97 9.86 9.71 9.34 10.39 9.99 10.30 10.41 18.95 4.82 4.87 4.42 4.59 4.89 4.71 5.03 5.56 6.76 6.58 MEMO Commercial real estate loans n.a. n.a. n.a. n.a. n.a. n.a. 8.48 7.43 5.92 4.24 Other real estate owned .14 .18 .21 .22 .23 .42 .78 1.13 1.02 .58 Managed liabilities 59.32 57.37 56.79 56.34 56.24 54.74 53.18 50.76 49.17 4466..1166 Average net consolidated assets (billions of dollars) 646 681 691 m 1 693 725 717 775 818 949 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 563 A.2.—Continued B. Ten largest banks by assets Item 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Effective interest rate (percent)3 Rates earned Interest-earning assets 11.27 9.69 9.56 10.74 12.31 11.65 9.91 8.67 8.16 8.15 Taxable equivalent 11.60 10.04 9.59 10.87 12.31 11.70 9.95 8.72 8.20 8.18 Loans and leases, gross 11.91 10.39 10.13 11.33 13.18 12.28 10.45 9.36 9.07 8.89 Net of toss provisions 10.74 9.09 6.63 10.68 10.86 11.10 8.59 7.50 7.95 8.38 Securities 9,95 8.58 9.49 10.52 10.11 9.84 8.52 7.38 6.69 7.09 Taxable equivalent 10.89 9.56 9.66 11.06 10.09 10.01 8.64 7.54 6.77 7.19 9.69 8.85 8.70 8.67 9 20 9 33 899 7 96 690 6 57 U.S. government and other debt 10.70 9.49 9.07 8.91 9.56 9.68 9.28 8.13 6.99 6.70 State and local 6.90 7.28 7.52 7.74 7.69 7.53 7.67 7.40 6.99 6.35 Equity0 n.a. n.a. n.a. n.a. 6.81 5.82 4.22 4.04 3.72 3.27 Trading account 10.35 8.18 10.96 14.33 12.13 10.75 7.84 6.69 6.45 7.79 Gross federal funds sold and reverse RPs 7.72 6.24 6.13 7.31 8.97 8.01 5.60 3.65 3.02 4.52 Interest-bearing balances at depositories 9.61 7.90 7.68 9.13 10.88 11.06 10.05 9.29 8.34 7.27 Rates paid i i i «« Interest-bearing liabilities 9.38 7.65 7.83 8.74 10.74 10.18 7.70 6.17 5.60 5.43 Interest-bearing deposits 8.68 7.11 6.97 7.76 9.19 9.03 7.09 5.33 4.50 4.32 In foreign offices 9.58 7.88 8.00 9.00 10.% 11.11 8.76 7.55 6.87 6.04 In domestic offices 7.52 6.22 5.63 6.26 7.27 6.81 5.46 3.24 2.36 2.35 Other checkable deposits n.a. n.a. 3.26 4.41 4.39 4.35 3.92 1.96 1.28 1.10 Savings (including MMDAs) n.a. n.a. 5.13 5.53 6.48 6.21 5.08 2.95 2.14 2.35 Large denomination CDs 9.03 7.23 7.29 7.73 8.87 7.95 6.49 4.66 3.55 3.12 Other time deposits rta. n.a. 6.38 7.08 8.25 7.75 6.07 3.81 3.01 2.80 Gross federal funds purchased and RPs 7.99 6.87 6.52 7.41 9.27 7.75 5.98 4.04 3.26 4.05 Income and expenses as £ percentag e of averaj e net consolidated assets Gross interest income 9.49 8.19 8.45 9.51 10.82 10.37 8.77 7.68 7.22 6.37 Taxable equivalent 9.76 8.49 8.48 9.62 10.83 10.43 8.80 7.72 7.26 6.40 Loans 7.45 6.28 6.23 6.92 8.22 7.96 6.77 5.65 5.22 4.49 Securities .56 .61 .71 .75 .83 .86 .84 .85 .86 .77 Gross federal funds sold and reverse RPs .29 .26 .29 .40 .37 .25 .17 .14 .11 .15 Other 1.19 1.04 1.22 1.44 1.39 1.30 .98 1.05 1.04 .97 Gross interest expense 6.75 5.50 5.77 6.50 8.01 7.65 5.81 4.54 4.06 3.52 Deposits 5.15 4.15 4.18 4.55 5.37 5.41 4.23 3.09 2.48 2.15 Gross federal funds purchased and RPs .74 .52 .58 .72 .64 .43 .28 .24 .24 Other .86 .75 1.07 1.37 1.92 1.60 1.15 1.17 1.35 1.13 2.74 2.70 2.68 3.01 2.81 2.72 2.95 3.15 3.16 2.86 Taxable equivalent 3.01 2.99 2.71 3.12 2.82 2.78 2.99 3.18 3.19 2.88 Loss provisions4 .73 .79 2.15 .40 1.45 .77 1.21 1.12 .64 .26 Noninterest income 1.33 1.59 1.94 2.07 2.19 2.27 2.40 2.59 2.99 2.33 Service charges on deposits .11 .13 .16 .19 .21 .23 .26 .30 .30 .26 Income from fiduciary activities .18 .21 .23 .23 .27 .31 .33 .37 .39 .36 .19 .20 .29 .26 .25 .30 .28 .36 .31 .15 Trading income .05 .09 .10 .15 .17 .21 .36 .30 .60 .39 Other .80 .97 1.16 1.24 1.29 1.21 1.16 1.27 1.38 1.18 Noninterest expense 2.68 2.95 3.20 3.28 3.43 3.55 3.83 3.86 4.13 3.56 Salaries, wages, and employee benefits 1.36 1.50 1.60 1.63 1.66 1.74 1.79 1.78 1.88 1.65 Expenses of premises and fixed assets .48 .54 .58 .60 .62 .65 .66 .65 .66 .55 Other .84 .91 1.03 1.05 1.15 1.16 1.38 I A3 1.59 1.36 Net noninterest expense 1.35 1.36 1.26 1.21 1.24 1.28 1.43 1.27 1.14 1.23 Realized gains on investment account securities .. .06 .12 .07 .03 .03 .02 .04 .11 .13 .02 Income before taxes and extraordinary items .71 .68 -.66 1.43 .16 .69 .35 .87 1.50 1.39 .25 .22 .14 .44 .38 .27 .17 .26 .53 .48 Extraordinary items <K • .08 .03 .06 .03 ifSfipllllj .16 mmmmM Net income .46 .46 -.80 1.07 -.19 .48 .22 .61 1.13 .91 Cash div idends declared .24 .21 .28 .38 .37 .26 .21 .18 .28 .58 .22 .25 -1.08 .69 -.57 .22 .01 .43 .85 .33 MEMO: Return on equity 9.59 9.46 -18.11 23.28 -3.92 10.13 4.35 10.91 16.75 13.86 * In absolute value, less than 0.005 percent. NOTE. For definitions of managed liabilities and commercial real estate loans, see text table 2, notes 1 and 2. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserve. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Where possible, based on an average of quarterly average balance sheet data reported on schedule RC-K of the quarterly Call Report. 4. Includes provision for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

564 Federal Reserve Bulletin • June 1995 A.2. Portfolio composition, interest rates, and income and expense, all insured domestic commercial banks and nondeposit trust companies, 1985-94 C. Banks ranked 11th through 100th by assets Item 1985 1986 1 1987 1988 J 1989 1990 1991 1992 1993 1994 Balance sheet items as a percentage of average net consolidated assets '^lilllPllllii Interest-earning assets 84.91 85.64 86.20 87.23 86.91 86.81 86.87 87.97 88.36 88.16 61.88 61.77 61.70 61.99 62.61 61.22 60.08 58.30 57.33 58.56 Commercial and industrial 24.20 24.13 23.72 23.45 22.75 21.76 20.53 18.83 18.03 18.03 U.S. addressees 21.09 21.21 21.22 21.43 21.23 20.44 19.30 17.78 17.05 17.00 Foreign addressees 3.11 2.92 2.50 2.02 1.53 1.33 1.24 1.05 .98 1.03 Consumer 11.19 11.80 11.73 12.20 12.97 12.25 11.66 11.72 11.47 12.62 Credit card sU-- 4.16 4.50 4.40 4.85 5.82 5.49 5.04 5.16 5.23 5.99 Installment and other 7.04 7.30 7.33 7.35 7.16 6.76 6.62 6.56 6.24 6.63 Real estate 13.76 13.94 16,05 17.94 19.09 20.21 21.51 21.89 22.12 22.26 In domestic offices 13.65 13,77 15.83 17.65 18.85 20.03 21.37 21.78 22.02 22.17 Construction and land development 4.46 4.79 5.24 527 V: 5.25 4.91 4.00 3.02 2.08 1.63 Farmland .08 .09 .10 .11 .12 .12 .12 .14 .13 .14 One- to four-family residential 5.71 5.27 5.88 6.85 1 7.54 8.53 10.17 11.36 12.30 12.98 Home equity n.a. n.a. n.a. 1.17 t.41 1.66 2.07 2.50 2.54 2.33 Other n.a. n.a. n.a. 5.68 6.13 6.86 8.10 8.85 9.76 10.64 Multifamily residential .31 .32 .39 .43 .45 .46 .54 .66 .71 .71 Nonfaim nonresidential 3.09 3.30 4.22 4.99 5.49 6.01 6.53 6.61 6.79 6.72 In foreign offices .12 .17 .22 .29 .24 .18 .14 .11 .10 .09 Depository institutions 3.37 2.83 2.51 1.84 1.55 1.57 1.58 1.43 1.30 1.49 Foreign governments 1.91 1.65 1.53 1.22 .88 .52 .39 .33 .30 .28 Agricultural production .51 .36 .30 .29 .29 .28 .31 .31 .29 .29 Other loans 7.18 7.26 6.25 5.54 5.17 4.82 4.55 4.28 4.05 3.47 Lease-financing receivables 1.20 1.33 1.52 1.69 \ 1.73 1.67 1.53 1.49 1.47 1.60 LESS: Unearned income on loans .56 .49 1 .40 37 .34 .26 .22 .17 .11 .07 LESS: Loss reserves' .90 1.03 1.51 1.80 1.48 1.60 1.76 1.79 1.60 1.41 Securities 11.55 14.11 15.26 15.54 15.21 16.20 17.38 20.38 21.97 21.19 Investment account 10.54 13.02 14.45 14.73 14.38 15.32 16.24 19.24 20.59 19.82 Debt 1034 13.02 14.45 14.73 1 14.16 15.14 16.02 18.99 20.34 19.50 U.S. Treasury 4.54 4.69 5.06 4.89 4.10 3.42 3.78 5.88 7.05 6.85 U.S. government agency and corporation obligations 1.32 2.05 3.13 3.58 5.01 7.42 8.43 9.26 9.54 9.28 Mortgage pass-through securities .81 1.40 2.36 2.96 4.03 5.32 5.38 5.22 5.21 5.31 Collateralized mortgage obligations .. n.a. n.a. n.a. n.a. B.a. 1.58 2.48 3.54 3.71 3.07 Other .52 .65 .77 .61 / .98 .53 .57 .50 .63 .91 State and local government 3.93 5.08 4.07 3.32 2.70 2.03 1.63 1.46 1.32 1.21 Other .75 1.20 2.18 2.94 235 2.27 2.19 2.39 2.43 2.15 Equity2 n.a. n.a. n.a. .22 .18 .22 .25 .26 32 Trading account 1.01 1.09 .81 .82 .83 .88 1.13 1.14 1.37 138 Gross federal funds sold and reverse RPs 3.69 3.17 3.07 3.68 3.71 4.41 4.90 4.78 4.98 5.11 Interest-bearing balances at depositories 7.79 6.58 6.16 6.01 5.38 4.98 4.51 4.52 4.08 3.30 Non-interest-earning assets 15.09 14.36 13.80 12.77 13.09 13.19 13.13 12.03 11.64 11.84 Liabilities 94.50 94.36 94.56 94.77 94.45 94.35 93.93 93.13 92.56 92.47 Interest-bearing liabilities 71.28 71.54 73.01 75.34 76.23 77.02 76.06 74.66 73.38 72.86 53.99 51.42 52.61 55.02 56.45 57.46 59.23 56.99 54.22 53.04 In foreign offices 11.85 10.45 10.14 9.68 8.63 7.84 6.69 6.20 6.78 8.05 In domestic offices 42.14 40.97 42.48 45.34 47.82 49.62 52.54 50.79 47.44 44.98 Other checkable deposits 3.57 3.84 4.42 4.68 4.67 4.75 5.36 6.26 7.21 6.91 Savings (including MMDAs) 14.73 15.17 16.02 15.67 14.58 15.50 17.62 20.21 20.60 20.13 Small denomination time deposits 11.40 10.31 9.63 11.05 13.49 15.59 17.99 15.98 14.19 13.26 Large denomination time deposits 12.44 11.65 12.40 13.95 15.08 13.79 11.56 8.34 5.44 4.68 Gross federal funds purchased and RPs 13.13 14.80 14.52 13.72 13.22 13.03 10.94 11.45 11.93 11.49 Other 4.15 5.31 5.87 6.59 6.57 6.53 5.89 6.22 7.23 8.34 Non-interest-bearing liabilities 23.22 22,82 21.55 19.44 18.22 17.33 17.87 18,47 19.18 19.62 Demand deposits in domestic offices 17.13 17.61 16.62 15.04 if: 13.86 13.23 13,76 14.52 15.38 15.27 Other 6.09 5.21 4.93 4.40 4.36 4.10 4.11 3.95 3.80 4.34 Capital account 5.50 5.64 5.44 5.23 5.55 5.65 6.07 6.87 7.44 7.53 MEMO: Commercial real estate loans n.a. n.a. n.a. n.a. n.a. n.a. 11.28 10.43 9.58 8.98 Other real estate owned .19 .17 .22 .31 .30 .46 .76 .70 .47 .25 Managed liabilities 41.85 42.56 43.29 44.27 43.81 41.50 35.41 32.53 31.69 32.83 Average net consolidated assets (billions of dollars) 668 735 802 870 940 995 1,006 1,003 1,083 1,204 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 565 A.2.—Continued C. Banks ranked 11th through 100th by assets Item 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Effective interest rate (percent)3 Rates earned Interest-earning assets 10.92 9.73 9.19 9.68 11.06 10.42 9.19 7.97 7.36 7.26 Taxable equivalent 11.48 10.35 9.41 9.89 11.23 10.51 9.29 8.07 7.45 7.34 Loans and leases, gross 11.61 10.47 9.77 10.29 11.70 11.06 9.84 8.74 8.25 8.19 Net of loss provisions 10.58 9.17 7.33 9.40 9.85 9.05 7.91 7.45 7.46 7.66 Securities 9.06 8.05 7.87 8.10 8.73 8.82 8.14 6.99 6.06 5.68 Taxable equivalent 10.94 10.10 8.69 8.83 9.34 9.14 8.49 7.30 6.33 5.91 Investment account 9.01 8.18 7.92 8.12 8.73 8.87 8.27 7.12 6.15 5.67 U.S. government and other debt 10.46 8.% 8.25 8.37 9.03 9.14 8.40 7.15 6.15 5.66 State and local 6.56 6.95 7.09 7.24 7.37 7.24 7.23 6.78 6.40 6.04 Equity2 n.a. n.a. n.a. n.a. 9.19 8.09 7.32 6.71 5.23 5.00 Trading account 9.56 6.55 6.99 7.67 8.66 8.01 6.45 4.73 4.74 5.75 Gross federal funds sold and reverse RPs 8.16 6.58 6.58 6.73 9.29 8.10 5.77 3.70 3.11 4.27 Interest-bearing balances at depositories 9.40 7.88 7.68 8.83 11.33 9.72 8.13 6.76 6.50 4.69 Rates paid Interest-bearing liabilities 8.45 77..1122 66..7755 7.16 88..6633 7.93 6.33 4.42 33..7766 33..7700 Interest-bearing deposits 8.14 6.91 6.42 6.86 8.10 7.52 6.19 4.30 3.51 3.24 In foreign offices 9.31 7.66 7.78 8.87 11.07 10.08 8.37 7.26 7.37 4.60 In domestic offices 7.84 6.72 6.10 6.43 7.57 7.11 5.91 3.95 2.99 3.01 Other checkable deposits n.a. n.a. 4.43 4.41 4.54 4.63 4.14 2.43 1.70 1.61 Savings (including MMDAs) n.a. n.a. 5.27 5.56 6.40 6.04 4.96 3.07 2.33 2.44 Large denomination CDs 8.74 7.43 7.01 7.41 8.68 8.08 6.71 5.09 4.30 4.20 Other time deposits n.a. n.a. 7.06 7.33 8.67 8.05 6.83 5.06 4.06 4.15 Gross federal funds purchased and RPs 8.03 6.85 6.63 7.23 9.33 8.11 5.70 3.57 3.04 4.28 Income and expenses as a percent of average net consolidated assets Gross interest income 9.19 8.19 8.04 8.55 9.74 9.27 8.14 7.12 6.58 6.43 Taxable equivalent 9.64 8.70 8.23 8.74 9.87 9.36 8.22 7.19 6.65 6.49 Loans 7.15 6.36 6.19 6.57 7.48 6.98 6.07 5.23 4.85 4.89 .95 1.06 1.14 1.20 1.26 1.36 1.34 1.37 1.27 1.12 Gross federal funds sold and reverse RPs .28 .20 .20 .22 .36 .37 .28 .19 .15 .21 Other .81 .56 .51 .56 .65 .56 .45 .34 .32 .21 Gross interest expense 5.89 4.95 4.85 5.32 6.47 6.06 4.74 3.26 2.74 2.66 Deposits 4.42 3.58 3.40 3.78 4.57 4.34 3.70 2.48 1.93 1.72 Gross federal funds purchased and RPs 1.06 1.01 .96 1.00 1.24 1.12 .67 .43 .38 .51 Other .40 .37 .48 .54 .66 .60 .38 .35 .43 .43 Net interest income 3.30 3.24 3.19 3.23 3.27 3.21 3.40 3.86 3.85 3.77 Taxable equivalent 3.75 3.75 3.38 3.42 3.40 3.30 3.47 3.93 3.91 3.83 Loss provisions4 .63 .79 1.55 .57 1.18 1.27 1.19 .78 .47 .32 Noninterest income 1.40 1.45 1.53 1.60 1.86 1.84 2.03 2.25 2.29 2.25 Service charges on deposits .27 .27 .29 .30 .30 .34 .40 .44 .46 .45 Income from fiduciary activities .31 .34 .36 .34 .35 .33 .36 .38 .38 .39 Foreign-exchange gains and fees .04 .03 .05 .04 .05 .06 .05 .05 .05 .04 Trading income .05 .05 .02 .03 .04 .03 .05 .04 .08 .04 Other .74 .75 .81 .88 1.12 1.09 1.18 1.33 1.32 1.33 Noninterest expense 3.17 3.16 3.23 3.18 3.32 3.43 3.72 3.98 3.95 3.85 Salaries, wages, and employee benefits 1.55 1.50 1.48 1.46 1.47 1.46 1.50 1.53 1.52 1.49 Expenses of premises and fixed assets .51 .50 .49 .49 .50 .49 .50 .49 .48 .47 Other 1.11 1.17 1.26 1.24 1.35 1.48 1.72 1.95 1.95 1.88 Net noninterest expense 1.77 1.71 1.70 1.59 1.46 1.59 1.69 1.73 1.66 1.60 Realized gains on investment account securities ... .05 .17 .05 * .04 .03 .14 .15 .09 -.01 Income before taxes and extraordinary items .95 .91 • 1.08 .67 .38 .66 1.50 1.82 1.84 Taxes .21 .20 .09 .28 .18 .15 .19 .48 .56 .62 Extraordinary items .01 .01 •: * .02 * .01 .03 .03 * * .74 .72 -.09 .81 .49 .24 .51 1.04 1.26 1.22 Cash dividends declared .26 .32 .34 .41 .40 .37 .47 .46 .76 .86 Retained income .48 .39 -.43 .40 .09 -.13 .04 .58 .49 .36 13.48 12.73 -1.69 15.52 8.81 4.26 8.34 15.18 16.88 16.21 * In absolute value, less than 0.005 percent. NOTE. For definitions of managed liabilities and commercial real estate loans, see text table 2, notes 1 and 2. n.a. Not available. MMDA, Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserve. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Where possible, based on an average of quarterly average balance sheet data reported on schedule RC-K of the quarterly Call Report. 4. Includes provision for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

566 Federal Reserve Bulletin • June 1995 A.2. Portfolio composition, interest rates, and income and expense, all insured domestic commercial banks and nondeposit trust companies, 1985-94 D. Banks ranked 101st through 1,000th by assets Item 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Balance sheet items as a percentage of average net consolidated assets Interest-earning assets 87.82 87.92 88.34 88.88 88.% 88.82 88.88 89.02 89.53 90.09 Loans and leases, net 59.27 59.77 61.60 63.03 63.61 63.08 61.01 58.51 57.92 59.74 Commercial and industrial 19.02 18.47 18.12 17.83 17.68 16.69 15.05 13.33 12.19 12.07 U.S. addressees 18.69 18.22 17.87 17.67 17.53 16.56 14.89 13.15 12.03 11.90 Foreign addressees .33 .25 .24 .16 .15 .13 .16 .18 .16 .16 Consumer 14.46 14.69 15.34 15.91 15.48 15.47 15.10 14.22 14.82 15.85 Credit card 3.50 4.01 4.65 5.21 4.82 5.22 5.71 5.42 5.65 6.06 Installment and other 10.96 10.68 10.69 10.70 10.65 10.25 9.39 8.80 9.18 9.79 Real estate 18.86 19.79 22.25 24.28 25.97 27.01 27.52 28.10 28.61 29.42 In domestic offices 18.86 19.78 22.25 24.27 25.95 26.99 27.47 28.06 28.58 29.40 Construction and land development 3.94 4.18 4.57 4.73 4.82 4.37 3.66 2.86 2.26 2.08 Farmland .23 .25 .26 .27 .27 .28 .28 .32 .34 .36 One- to four-family residential 8.42 8.49 9.48 10.64 11.55 12.48 13.22 14.25 15.16 16.25 Home equity n.a. n.a. 0. n.a. 1.73 2.08 231 2.53 2.56 2.50 2.33 Other n.a. n.a. n.a. 8.91 9.47 10.18 10.68 11.69 12.66 13.92 Multifamily residential .59 .66 .68 .67 .70 .74 .80 .95 1.07 g 1.13 Nonfarm nonresidential 5.68 6.21 7.26 7.97 8.61 9.12 9.51 9.68 9.75 9.57 In foreign offices * .01 v .01 .01 .01 .03 .05 .04 .02 .03 Depository institutions fc 1.58 1.36 1.13 1.01 .92 1.05 .93 .80 .43 # .38 Foreign governments .30 .26 .25 .20 .16 .09 .07 .05 .03 .02 Agricultural production . ,75 .62 .48 .47 .45 .47 .49 J4 .56 .62 Other loans 5.30 5.44 4.94 4.23 3.77 3.17 2.81 2.47 2.16 2.01 Lease-financing receivables .64 .71 .72 .78 • .82 .83 .85 .78 .76 82 LESS: Unearned income on loans .88 .71 .61 .60 .56 .50 .40 .30 .21 .15 LESS: LOSS reserves' .77 .87 1,01 1.07 1.07 1.20 1.42 1.49 1.44 1.30 Securities 19.60 19.28 18.72 18.52 18.75 19.33 21.28 24.12 25.91 25.71 Investment account 19.36 18.95 V 18.50 18.25 18.37 18.86 20.91 23.77 25,62 25.39 Debt 19.36 18.95 18.50 18.25 18.02 18.53 20.55 23.31 25.15 24.95 U.S. Treasury 8.63 7.58 7.14 6.52 5.90 5.44 6.16 7.75 8.63 8.26 U.S. government agency and corporation obligations 3.37 3.32 4.06 4.81 6.06 7.74 9.35 11.07 12.33 12.67 Mortgage pass-through securities 1.06 1.13 1.89 2.33 3.03 3.83 4.51 4.74 4.97 5.57 Collateralized mortgage obligations .. n.a. n.a. tut. n.a. n.a. 1.74 2.73 3.95 4.82 4.39 Other 2.31 2.19 2.17 2.48 3.03 2.17 2.11 2.38 2.53 2.71 State and local government 6.18 6.48 5.03 4.10 3.49 3.11 2.65 2.27 2.26 2.29 Other 1.19 1.57 2.26 2.82 2.56 2.25 2.38 2.22 1.94 1.74 Equity1 n.a. n.a. n.a. n a. .35 .32 .37 .46 .47 .44 Trading account !iS .24 .33 .22 .28 .38 .48 .37 .35 .29 .31 Gross federal funds sold and reverse RPs 5.15 5.66 4.94 4.45 4.11 4.51 4.70 4.92 450 3.64 Interest-bearing balances at depositories 3.80 3.22 3.08 2.87 2.49 1.90 1.90 1.47 1.20 1.00 Non-interest-earning assets 12.18 12.08 11.66 11.12 11.04 11.18 11.12 10.98 10.47 9.91 Liabilities 93.44 93.33 93.28 93.34 93.26 93.07 92.89 92.47 91.86 91.62 Interest-bearing liabilities 72.90 73.01 73.92 75.59 76.42 77.05 77.26 75.98 74.44 74.78 Deposits 62.62 62.17 62.43 63.00 63.68 65.02 66.30 65.63 63.06 60.39 In foreign offices 2.00 2.07 S 1.96 2.04 2.09 1.65 1.76 1.56 1.43 1.69 In domestic offices 60.62 60.10 60.47 60.97 61.59 63.37 64.55 64.07 61.63 58.69 Other checkable deposits 5.55 6.25 7.27 7.39 7.14 7.30 7.83 9.14 9.94 9.71 Savings (including MMDAs) 21.50 22.37 22.83 21.27 19.50 19.68 20.72 23.32 2405 22.92 Small denomination time deposits 19.92 18.66 17.75 19.34 22.06 24.08 25.21 23.55 20.80 19.29 Large denomination time deposits 13.65 12.83 12.62 12.96 12.90 12.30 10.79 8.07 6.84 6.78 Gross federal funds purchased and RPs 7.90 8.21 8.46 8.63 9.20 8.42 7.46 7.17 7.43 8.45 Other 2.38 2.63 303 3.% 3.54 3.60 3.50 3.19 3.95 5.94 Non-interest-bearing liabilities 20.53 20.32 19.36 17.74 16.84 16.03 15.63 16.48 17.42 16.85 Demand deposits in domestic offices 18.29 18.25 17.35 15.84 14.85 14.07 13.56 14.38 15.06 14.58 Other 2.24 2.08 2.00 1.90 1.99 1.% 2.07 2.10 2.36 2.27 Capital account 6.56 6.67 6.72 6.66 6.74 6.93 7.11 7.53 8.14 8.38 MEMO Commercial real estate loans n.a. n.a. n.a. n.a. n.a. aa. 13.84 12.95 12.31 11.92 Other real estate owned .28 .30 .37 .42 .46 JSS .79 .80 .57 .28 Managed liabilities 25.88 25.67 26.00 27.51 27.67 25.% 23.49 19.97 19.65 22.86 Average net consolidated assets (billions of dollars) 638 710 771 839 892 938 961 968 978 1,032 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 567 A.2.—Continued D. Banks ranked 101st through 1,000th by assets Item 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Effective interest rate (percent)3 Rates earned Interest-earning assets 10.95 9.91 9.44 9.90 10.71 10.41 9.53 8.14 7.40 7.58 Taxable equivalent 11.57 10.52 9.80 10.15 10.93 10.57 9.68 8.26 7.53 7.68 Loans and leases, gross 11.89 10.83 10.30 10.75 11.57 11.20 10.40 9.12 8.54 8.64 Net of loss provisions 10.89 9.60 9.05 9.60 10.42 9.47 8.70 7.84 7.74 8.11 Securities i 9.15 8.29 7.67 7.83 8.33 8.52 8.09 6.88 5.75 5.69 Taxable equivalent 10.89 10.09 8.77 8.59 8.98 9.02 8.54 7.20 6.09 5.95 Investment account 9.15 8.30 7.69 7.84 8.34 8.49 8.11 6.90 5.76 5.69 U.S. government and other debt 10.24 8.98 7.94 8.04 8.61 8.75 8.28 6.95 5.73 5.68 State and local 6.82 7.01 7.01 7.15 7.26 7.32 7.26 6.84 6.26 5.90 Equity2 n.a. n.a. n.a. n.a. 6.90 6.97 6.00 5.06 4.91 5.28 Trading account 8.88 7.42 5.80 6.96 7.61 9.92 6.86 5.62 4.83 5.29 Gross federal funds sold and reverse RPs 8.22 6.84 6.62 7.47 8.95 7.98 5.63 3.47 3.00 4.03 Interest-bearing balances at depositories . 9.15 7.53 7.03 7.82 9.18 8.51 6.81 4.61 3.50 4.28 Rates paid Interest-bearing liabilities 8.02 6.92 6.29 6.70 7.69 7.25 6.08 4.19 3.31 3.57 Interest-bearing deposits 7.85 6.75 6.08 6.49 7.33 7.05 6.04 4.16 3.24 3.31 In foreign offices 8.65 6.94 6.77 7.65 8.98 8.12 6.38 4.25 3.35 4.31 In domestic offices 7.82 6.76 6.06 6.45 7.28 7.02 6.03 4.16 3.24 3.28 Other checkable deposits n.a. n.a. 4.64 4.77 4.86 4.75 4.28 2.67 2.01 1.86 Savings (including MMDAs) ....... n.a. n.a. 5.28 5.53 6.!1 5.98 5.12 3.33 2.57 2.65 Large denomination CDs 8.61 7.30 6.79 7.39 8.64 8.03 6.61 4.75 3.86 4.22 Other time deposits n.a. n.a. 7.14 7.45 . 8.28 8.03 7.05 5.34 4.38 4.40 Gross federal funds purchased and RPs .. 7.87 6.60 6.34 7.39 8.96 7.86 5.60 3.46 2.95 4.12 Income and expenses as a percentage of average net consolidated assets Gross interest income 9.61 8.67 8.38 8.86 9.64 9.37 8.61 7.36 6.71 6.91 Taxable equivalent 10.15 9.21 8.70 9.09 9.83 9.51 8.74 7.47 6.81 7.00 Loans 7.06 6.48 6.43 6.88 7.49 7.21 6.49 5.46 5.04 5.26 Securities 1.77 1.57 1.42 1.43 1.53 1.60 1.70 1.64 1.48 1.45 Gross federal funds sold and reverse RPs .43 .37 .31 .32 .37 .36 .27 .17 .13 .14 Other .36 .25 .22 .24 .25 .19 .15 .08 .06 .06 Gross interest expense 5.75 4.94 4.57 5.02 5.82 5.53 4.66 3.16 2.45 2.65 Deposits 4.92 4.21 3.81 4.09 4.67 4.58 4.01 2.74 2.06 2.01 Gross federal funds purchased and RPs .63 .55 .53 .64 .83 .67 .42 .25 .22 .35 Other .20 .19 .23 .29 .32 .29 .23 .17 .17 .29 Net interest income 3.86 3.73 3.81 3.85 3.82 3.83 3.95 4.20 4.26 4.26 Taxable equivalent 4.39 4.27 4.12 4.07 4.01 3.97 4.08 4.31 4.36 4.35 Loss provisions4 .59 .74 .78 .74 .74 l.H 1.06 .77 .47 .32 Noninterest income 1.28 1.30 1.35 1.36 1.38 1.49 1.64 1.69 1.83 1.85 Service charges on deposits .35 .34 .34 .34 .35 .37 .40 .44 .44 .42 I F n o c r o e m ig e n - f e r x o c m h a f n id g u e c i g a a r i y n s a c a t n iv d i t f i e e e s s . . 0 2 1 6 . . 0 2 1 5 . . 0 2 1 5 1 * .2 5 . . 0 2 1 5 ijpSJ^ .2 II 6 SM S . . 0 2 1 7 * . 28 . . 0 2 1 9 . . 0 2 1 8 Trading income .04 .04 .03 .03 .03 .02 .03 .02 .02 .01 Other .63 .67 .72 .74 .74 .84 .94 .95 1.07 1.13 Noninterest expense 3.55 3.50 3.52 3.50 3.43 3.50 3.75 3.87 3.90 3.78 Salaries, wages, and employee benefits 1.67 1.59 1.54 1.49 1.47 1.47 1.47 1.51 1.51 1.49 Expenses of premises and fixed assets .55 .53 .52 .50 .49 .49 .49 .49 .48 .46 Other 1.34 1.38 1.47 1.51 1.47 1.54 1.79 L87 1.91 1.83 Net noninterest expense 2.28 2.20 2.17 2.14 2.04 2.00 2.11 2.18 2.07 1.92 Realized gains on investment account securities.. .05 .12 .04 * .01 .01 .09 .10 .06 -.05 Income before taxes and extraordinary items 1.05 .91 .89 .97 1.05 .73 .87 1.36 1.78 1.96 Taxes .21 .18 .27 .32 .32 .21 .29 .44 .61 .67 Extraordinary items .02 .01 .02 .01 * .03 .04 jj|j|j|i® Net income .85 .74 .64 .67 .73 .52 .61 .92 1.22 1.29 Cash dividends declared .40 .40 .44 .48 .48 .53 .58 .48 .79 .81 Retained income .45 .34 .20 .18 .25 -.01 .03 .44 .43 .48 MEMO: Return on equity 12.99 11.10 9.53 10.00 10.94 7.45 8.60 12.25 14.93 15.42 * In absolute value, less than 0.005 percent. NOTE. For definitions of managed liabilities and commercial real estate loans, see text table 2, notes 1 and 2. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserve. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Where possible, based on an average of quarterly average balance sheet data reported on schedule RC-K of the quarterly Call Report. 4. Includes provision for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

568 Federal Reserve Bulletin • June 1995 A.2. Portfolio composition, interest rates, and income and expense, all insured domestic commercial banks and nondeposit trust companies, 1985-94 E. Banks not ranked among the 1,000 largest by assets 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Balance sheet items as a of average net i 89.87 90.00 90.50 90.81 90.88 91.04 91.23 91.39 91.66 91.72 Loans and leases, net 53.80 52.82 52.82 53.88 54.85 54.73 54.06 53.03 52.96 54.65 Commercial and industrial 14.33 13.68 12.84 12.34 12.10 11.53 10.59 9.74 9.25 9.32 U.S. 14.29 13.65 12.81 12.32 12.07 11.49 10.55 9.70 9.21 9.27 Foreign .03 .03 .03 .02 .03 .04 .04 .04 .04 .05 13.01 12.41 11.74 11.48 11.46 11.19 10.49 9.68 9.17 9.38 Credit card .61 .68 .80 .86 .93 1.00 1.08 LOO .91 .96 ; and other 12.40 11.74 10.94 10.62 10.53 10.19 9.41 8.68 8.26 8.41 20.83 21.94 24.07 26.03 27.36 28.35 29.32 30.16 31.11 32.19 In domestic offices 20.83 21.94 24.07 26.03 27.36 28.35 29.32 30.15 31.10 32.18 Construction and land development.. 2.16 2.21 2.19 2.22 2.29 2.37 2.18 1.98 1.93 2.14 Farmland 1.32 1.42 1.59 1.74 1.82 1.86 1.93 2.06 2.20 2.34 One- to four-family residential — 11.23 11.62 12.80 14.06 14.80 15.37 15.99 16.44 16.82 16.95 Home equity n.a. n.a. .73 .95 1.16 1.29 1.34 1.27 1.21 Other n.a. n.a. 13.32 13.86 14.21 14.70 15.10 15.55 15.74 Multifamily residential .50 .54 .60 .61 .62 .66 .71 .77 .84 .93 Nonfarm nonresidential 5.62 6.15 6.90 7.40 7.82 8.09 8.50 8.91 9.30 9.83 * * * * * * * In foreign offices * * Depository institutions .27 .25 .30 .31 .26 .23 .20 .13 .12 .13 Foreign governments .01 .01 .01 .02 .01 .01 .01 .01 .02 .01 Agricultural production 4.52 3.76 3.30 3.25 3.27 3.29 3.47 3.54 3.58 3.89 Other loans 2.40 2.20 1.90 1.75 1.67 1.41 1.24 .99 .87 .81 Lease-financing receivables .19 .19 .19 .19 .19 .18 .18 .17 .18 .19 LESS: Unearned income on loans 1.07 .83 .67 .61 .60 .58 .51 .43 .36 .31 LESS: Loss reserves' .69 .78 .86 .88 .88 .89 .93 .96 .97 .95 Securities 27.55 26.96 27.67 27.98 27.90 28.37 29.97 32.10 33.07 32.90 Investment account 27.51 26.91 27.59 27.92 27.83 28.27 29.91 32.04 33.01 32.86 Debt 27.51 26.91 27.59 27.92 27.44 27.91 29.53 31.60 32.56 32.42 us: Treasury':::::::::::::::::::::: 12.63 11.39 10 64 9.75 8.83 8.77 9.24 10.25 10.50 10.81 U.S. government agency and corporation obligations 6.17 6.45 8.18 9.80 11.37 12.43 13.80 15.03 15.80 15.35 Mortgage pass-through securities.. 1.55 1.38 2.66 3.22 3.76 4.58 5.59 5.52 5.38 4.82 Collateralized mortgage obligations n.a. tut. n.a. n.a. n.a. .92 1.55 2.66 3.33 3-11 Other 4.62 5.07 5.52 6.58 7.61 6.93 6.66 6.85 7.09 7.42 State and local government 8.02 8.01 6.63 5.65 4.94 4.56 4.26 4.29 4.69 5.00 Other .69 1.06 2.13 2.73 2.30 2.16 2.23 2.03 1.58 1.25 Equity2 n.a. n.a. n.a. n.a. .40 .36 .38 .44 .45 .44 Trading account .04 .05 .08 .05 .07 .10 .06 .06 .07 .04 Gross federal funds sold and reverse RPs ... 5.61 7.09 6.66 5.76 5.74 6.13 5.64 5.10 4.67 3.41 Interest-bearing balances at depositories 2.90 3.13 3.36 3.19 2.39 1.81 1.57 H6 .96 .76 Non-interest-earning assets 10.13 10.00 9.50 9.19 9.12 8.96 8.77 8.61 8.34 8.28 Liabilities 91.72 91.80 91.74 91.61 91.43 91.38 91.36 91.07 90.64 90.45 Interest-bearing liabilities 74.90 75.62 76.39 76.94 77.13 77.81 78.39 77.83 76.90 76.20 Deposits 72.73 73.66 74.39 74.83 74.97 75.76 76.40 75.74 74.56 73.16 In foreign offices .07 .06 .04 .04 .06 .07 .08 .07 .08 .09 In domestic offices 72.66 73.60 74.34 74.80 74.90 75.69 76.32 75.67 74.48 73.07 Other checkable deposits 8.10 9.03 10.33 10.63 10.38 10.44 10.98 12.33 13.16 13.32 Savings (including MMDAs) 21.06 22.19 23.30 21.92 19.51 18.73 19.35 22.10 23.55 23.24 Small denomination time deposits ... 31.98 30.89 29.56 30.97 33.64 35.35 35.85 32.84 30.11 28.84 Large denomination time deposits ... 11.52 11.49 11.16 11.27 11.37 11.17 10.15 8.40 7.66 7.68 Gross federal funds purchased and RPs ... 1.48 1.29 1.27 1.35 1.35 1.36 1.31 1.36 1.44 1.89 Other .70 .66 .73 .76 .81 .69 .67 .73 .90 1.15 Non-interest-bearing liabilities 16.81 16.19 15.35 14.67 14.31 13.57 12.97 13.24 13.74 14.25 Demand deposits in domestic offices 15.24 14.87 14.24 13.58 13.09 12.36 11.83 12.23 12.82 13.35 Other 1.57 1.32 1.11 1.09 1.22 1.21 1.15 1.01 .92 .90 Capital account 8.28 8.20 8.26 K.39 8.57 8.62 8.64 8.93 9.36 9.55 MEMO Commercial real estate loans n.a. n.a. n.a. n.a. n.a. n.a. 11.04 11.08 11.38 12.09 Other real estate owned .44 .55 .63 .65 .65 .63 .67 .66 .52 .35 Managed liabilities 13.70 13.43 13.14 13.36 13.55 13.25 12.17 10.53 10.06 10.80 Average net consolidated (billions of dollars). 621 649 659 654 662 681 695 697 687 679 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Profits and Balance Sheet Developments at U.S. Commercial Banks in 1994 569 A.2.—Continued E. Banks not ranked among the 1,000 largest by assets 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1 J 1 • ^ Effective interest rate (percent)3 Rates earned 11.33 10.28 9.53 9.75 10.48 10.30 9.63 8.43 7.60 7.58 Taxable equivalent 11.86 10.79 9.86 10.00 10.72 10.52 9.82 8.59 7.77 7.74 12.61 11.66 10.85 11.01 11.74 11.59 11.01 9.82 9.11 9.01 ^ Net of loss provisions 11.11 9.98 9.59 9.98 10.85 10.64 10.08 9.04 8.61 8.67 8.72 7.92 7.93 8.37 8.42 8.03 6.99 5.92 5.61 Taxable equivalent... 11.26 10.31 8.94 8.65 9.03 9.01 8.55 7.42 6.35 6.02 9.64 8.72 7.91 7.91 8.35 8.40 8.03 6.99 5.92 5.61 U.S. government and other debt 10.54 9.24 8.04 8.00 8.51 8.59 8.19 7.06 5.91 5.60 State and local 7.47 7.52 7.52 7.56 7.56 7.46 7.17 6.71 6.09 5.69 n.a. a.a. a.a. n.a. 8.19 8.34 7.12 5.63 5.13 5.53 Trading account 10.26 8.44 9.04 14.88 14.86 12.13 8.75 7.34 4.79 6.86 Gross federal funds sold and reverse RPs 8.26 6.91 6.81 7.67 9.24 8.11 5.65 3.50 2.95 4.08 9.64 8.07 7.37 8.06 9.11 8.54 7.35 5.60 4.54 4.68 Rates paid Interest-bearing liabilities 8.09 7.01 6.19 6.41 7.15 7.01 6.17 4.44 3.53 3.49 Interest-bearing deposits 8.06 6.96 6.12 6.36 7.09 6.96 6.15 4.44 3.52 3.44 In foreign offices 8.34 7.06 7.29 7.62 9.35 7.57 5.95 3.97 2.91 3.92 In domestic offices 8.06 6.96 6.12 6.36 7.09 6.% 6.15 4.44 3.52 3.44 Other checkable deposits .... n.a. n.a. 4.93 4.99 5.08 5.02 4.61 3.13 2.42 2.29 Savings (includliinngg 1M MDAs) n.a. OJL. 5.37 5.47 5.81 5.73 5.17 3.62 2.90 2.83 Large denomination CDs 8.69 7.35 6.56 7.12 8.35 7.91 6.73 4,89 3.95 4.12 Other time deposits n.a. n.a. 6.96 7.16 8.02 7.88 6.97 5.36 4.37 4.28 Gross federal funds purchased and RPs 7.79 6.59 6.25 6.79 8.51 8.02 5.71 3.73 3.17 4.12 Income and expenses as a percentage of average net consolidated assets Gross interest income 10.29 9.32 8.71 8.94 9.64 9.50 8.91 7.79 7.04 7.02 Taxable equivalent 10.76 9.77 9.01 9.17 9.84 9.68 9.07 7.94 7.19 7.16 Loans 6.87 6.22 5.81 6.01 6.52 6.43 6.04 5.29 4.90 4.99 Securities 2.65 2.35 2.18 2.21 2.32 2.38 2.40 2.24 1.96 1.84 Gross federal funds sold and reverse RPs .50 .50 .47 .46 .57 .53 .34 .18 .14 .15 Other .28 .25 .25 ,26 .23 .17 .12 .07 .05 .04 Gross interest expense 6.04 5.27 4.71 4.91 5.49 5.43 4.82 3.45 2.71 2.65 Deposits 5.87 5.13 4.57 4.76 5.31 5.27 4.70 3.36 2.63 2.52 Gross federal funds purchased and RPs .. .12 .09 .08 .10 .12 .11 .07 .05 .04 .07 Other .06 .05 .06 .06 .06 .05 .05 .04 .04 .06 Net interest income 4.05 4.00 4.03 4.15 4.07 4.09 4.34 4.33 4.36 Taxable equivalent 4.72 4.50 4.30 4.26 4.35 4.25 4.25 4.49 4.48 4.51 Loss provisions4 .82 .90 .67 .56 .49 .53 .51 .42 .27 .19 Noninterest income ............... .84 .85 .88 .92 .99 1.01 1.07 1.16 1.25 1.28 Service charges on deposits .41 .41 .41 .41 .42 .44 .45 .45 .44 Income from fiduciary activities . .10 .10 .11 .12 .14 .14 .14 .16 .15 .16 T F r o a r d ei i g n n g - e in x c c o h m an e g e gains and fees » * « # * * * * . 01 ®is . f 0 il 1 l® 8fcfls * * Wi$ * mm 4 M s $ B M i s $ l w i i s S ^ . § p S t jfMp Other .30 .33 .35 .39 .44 .44 .49 .55 .64 .68 3.43 3.46 3.43 3.44 3.48 3.49 3.60 3.66 3.72 3.76 Salaries, wages, and employee benefits 1.66 1.63 1.61 1.62 1.65 1.64 1.64 1.69 1.72 1.74 Expense-ss <of f pprreenm ises and fixed .53 .53 .52 .51 .50 .49 .49 .49 .48 .48 Other.... 1.24 1.30 1.30 1.31 1.33 1.36 1.46 1.49 1.52 1.54 Net noninterest expense 2.60 2.61 2.55 2.52 2.48 2.48 2.52 2.51 2.48 2.48 Realized gains on investment account securities . .08 .15 .03 .01 .01 * .06 .09 .07 -.03 Income before taxes and extraordinary items .91 .70 .82 .96 1.18 1.06 1.11 1.50 1.65 1.66 Taxes .20 .15 .25 .29 .36 .34 .35 .47 .51 .51 .01 .01 .02 .02 .02 .02 .01 .02 .05 tMflP Net income .72 .56 .59 .69 .83 .74 .78 1.04 1.19 1.16 Cash dividends declared .43 .40 .40 .46 .53 .50 .47 .51 .55 .57 Retained income .30 .16 .19 .22 .30 .24 .30 .53 .64 .58 MEMO: Return on equity .. 8.70 6.81 7.09 8.19 9.67 8.61 8.98 11.64 12.76 12.10 * In absolute value, less than 0.005 percent. NOTE. For definitions of managed liabilities and commercial real estate loans, see text table 2, notes 1 and 2. n.a. Not available. MMDA Money market deposit account. RP Repurchase agreement. CD Certificate of deposit. 1. Includes allocated transfer risk reserve. 2. As in the Call Report, equity securities are combined with "other debt securities" before 1989. 3. Where possible, based on an average of quarterly average balance sheet data reported on schedule RC-K of the quarterly Call Report. 4. Includes provision for allocated transfer risk. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

570 Monetary Policy and Open Market Operations during 1994 •j- ". This article is adapted from a report to the Federal the responses of the fixed-income securities mar- Open Market Committee by Peter R. Fisher, Execu- kets to economic and policy developments. Monetive Vice President of the Federal Reserve Bank of tary policy moved away from the accommodative New York and Manager of the System Open Market stance that had been in place for some time as the Account. Ann-Marie Meulendyke, Adviser, Open robust pace of economic growth cut into remaining Market Function, and Spence Hilton, Manager, excess productive capacity. With the economy Open Market Trading and Analysis Staff, were expanding rapidly and the Federal Reserve acting primarily responsible for the preparation of this to restrain inflationary pressures, interest rates report. Other members of the Open Market Func- moved sharply higher and the yield curve flattened. tion assisting in the preparation of the report were The extent of the rise in yields took many market Robert Van Wicklen, Theodore Tulpan, Eileen participants by surprise, contributing to losses and Steigleder, and Steve Zannetos. William May, Econ- a few bankruptcies, particularly by highly leveromist, Financial Markets and Institutions Depart- aged accounts. ment, also assisted. The final section of this report discusses the Open Market Trading Desk's implementation of In 1994 the operating techniques for implementing the objectives established by the Federal Open monetary policy remained similar to those of recent Market Committee (FOMC). It reviews policy years; however, the Trading Desk at the Federal techniques and factors affecting reserve supplies Reserve Bank of New York gained slightly more and demands over the year. In 1994 the Desk flexibility in its execution of open market opera- added a net $32 billion to its securities portfolio, tions after the Federal Open Market Committee the second largest annual increase. Repurchase began announcing its policy actions in February. agreements with relatively short maturities were As a consequence of the change in procedures, used extensively by the Desk to manage reserves open market operations were no longer used to within two-week reserve maintenance periods; such communicate policy shifts. Nearly all the Desk's transactions are well adapted to handle short-term operations added reserves because cumulative variations in reserve levels and the frequent revireserve shortages were substantial for the fourth sions to estimated reserve needs. In addition, pricconsecutive year. These deficiencies reflected the ing of daylight overdrafts, which began in April, continued rapid expansion of currency, which had the potential to complicate policy implementastemmed in part from heavy currency shipments tion, but the actual effects on operations proved to abroad. Working in the other direction were be minimal. declines in the demand for reserve balances arising from monetary policy tightening. Higher interest rates reined in the growth of transactions deposits and reduced the balances that banks were required MONETARY POLICY to hold at the Federal Reserve. As these balances AND FINANCIAL MARKET RESPONSE fell, banks lost some flexibility in managing their reserve positions, and by year-end the potential for The Course of Monetary Policy operating difficulties associated with low balances had reemerged. Monetary policy in 1994 was formulated against a The next section of the report briefly reviews the background of rapid economic growth and rising course of monetary policy in 1994 and describes resource utilization but generally modest aggregate Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

571 price increases. The FOMC increased reserve pres- (table 1). Asymmetric directives indicating a sures at five of eight meetings and once between greater likelihood that future changes in policy meetings, resulting in a cumulative increase of would be toward restraint were adopted at the three 2Vi percentage points in the federal funds rate meetings at which no change was made to existing 1. Specifications from directives of the Federal Open Market Committee and related information, December 21, 1993-December 20, 1994 Borrowing assumption Associated Effect on for deriving Guidelines for modifying Date of Specified short-term Discount rate nonborrowed federal degree of reserve pressure meeting growth for M2 andM3 (percent) reserve path funds rate' reserve between meetings2 (millions (percent) pressure of dollars) 12/21/93 Moderate growth over coming 3 50 3 Maintain Slightly greater reserve restraint months or slightly lesser reserve restraint might be acceptable. 2/3 to 2/4/94 ... Moderate growth over the 3 50 m Increase it first half of the year 75 on 2/43 slightly 3/22/94 Moderate growth over the 3 75 3V4 Increase first half of the year 100 on 3/233 slightly 125 on 4/18* 33/4 on 4/18 150on5/54 175 on 5/124 5/17/94 MMooddeesstt ggrroowwtthh oovveerrccoommiinngg 33»»//22 175 5 44««//44 Increase mmoonntthhss 200 on 5/194 somewhat 225 on 5/264 325 on 6/234 7/5 to 7/6/94 ... Modest growth over coming 3'A 325 43/4 Maintain Slightly greater reserve restraint months 375 on 7/7 4 would be acceptable; slightly lesser reserve restraint might be 425 on 7/214 acceptable. 450 on 7/28 4 8/16/94 Modest growth over coming 4 450' 43/4 Increase Slightly greater reserve restraint months 475 on 8/18 4 somewhat or slightly lesser reserve restraint would be acceptable. 500 on 8/254 475oa 9/14 9/27/94 MMooddeesstt ggrroowwtthh oovveerr tthhee bbaallaannccee 4 475 4433//44 MMaaiinnttaaiinn SSoommeewwhhaatt ggrreeaatteerr rreesseerrvvee ooff tthhee yyeeaarr 450 on 1Q/64 rreessttrraaiinntt wwoouulldd bbee aacccceeppttaabbllee;; sslliigghhttllyy lleesssseerr rreesseerrvvee rreessttrraaiinntt 425 on 10/13 4 mmiigghhtt bbee aacccceeppttaabbllee.. 375 on J0/20* 325 on 10/274 375onU/34 225 on 11/104 11/15/94 MMooddeesstt ggrroowwtthh oovveerr ccoommiinngg 44%% 2255 55''AA Increase SSoommeewwhhaatt ggrreeaatteerr rreesseerrvvee mmoonntthhss significantly rreessttrraaiinntt oorr ssoommeewwhhaatt lleesssseerr 175 on 11/24" rreesseerrvvee rreessttrraaiinntt wwoouulldd bbee 125 on 12/84 aacccceeppttaabbllee.. 12/20/94 MMooddeesstt ggrroowwtthh oovveerr ccoommiinngg 44%% 112255 55VV44 MMaaiinnttaaiinn SSoommeewwhhaatt ggrreeaatteerr rreesseerrvvee mmoonntthhss rreessttrraaiinntt wwoouulldd bbee aacccceeppttaabbllee;; sslliigghhttllyy lleesssseerr rreesseerrvvee rreessttrraaiinntt mmiigghhtt bbee aacccceeppttaabbllee.. 1. The trading area for the federal funds rate that is expected to be 3. Change in borrowing assumption reflects adjustment to reserve consistent with the borrowing assumption. pressures. 2. Modifications to reserve pressures are evaluated "in the context of the 4. Change in borrowing assumption reflects technical adjustment to Committee's long-run objectives for price stability and sustainable economic account for actual or prospective behavior of seasonal borrowing. growth, and giving careful consideration to economic, financial, and mon- 5. The assumption was unchanged because the full effect of the discount etary developments." rate increase was allowed to show through to the market. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

572 Federal Reserve Bulletin • June 1995 pressures. Meanwhile, the Board of Governors ness investment, and inventory accumulation the approved three increases in the discount rate total- mainstays of growth (table 2). Consumer outlays ing VA percentage points. When determining the for durable goods were particularly robust, and stance of policy, the FOMC continued to monitor a producers' durable equipment purchases remained broad range of economic and financial indicators. strong for the third consecutive year. The rate of Annual targets were still set for the broader mone- inventory investment picked up over the first two tary aggregates, but the FOMC placed limited quarters and remained at relatively high levels for weight on the aggregates because of the consider- the rest of the year. The pace of expansion was able uncertainty that persisted about the behavior moderated by developments in other sectors: Resiof their velocities.1 dential construction activity cooled off as the year progressed, government expenditures trended lower, and the trade balance remained a modest Economic Background drag. Despite these offsetting factors, by year-end the rapid pace of output expansion had brought The economic expansion remained on solid footing resource utilization rates up to levels associated throughout 1994, with personal consumption, busi- historically with rising inflationary pressures. The unemployment rate fell to 5.4 percent in December, and the industry operating rate stood at 1. The behavior of the monetary aggregates and the Commit- 85.4 percent. tee's targets for them are discussed in appendix A. 2. Output and prices, 1993:Q4-1994:Q4 Seasonally adjusted annual rates of change, except as noted -- 11999933 1994 II9999 tt 22 oo :: QQ44 119999 tt 33 oo :: QQ44 0044 Q1 Q2 03 Q4 11999933::QQ44 11999944::QQ44 OUTPUT Real GDP 6.3 3.3 4.1 4.0 5.1 3.1 4.1 Change in inventory accumulation1 ... -2.2 14.6 33.8 -2.1 -7.7 4.2 38.6 Final sales 6.4 2.2 1.5 4.3 5.7 3.0 3.4 Consumption 4.0 4.7 1.3 3.1 5.1 3.0 3.5 Durables 15.5 8.8 .4 5.8 20.4 9.0 8.6 Nondnrables 2.4 3.8 2.2 3.3 3.1 1.3 3.1 Services 2.0 4.0 1.1 2.2 2.3 2.5 2.4 Producers' durable equipment 27.5 18.6 6.1 18.1 19.6 21.3 15.5 Nonresidential structures 3.3 -11.8 20.6 1.6 11.0 1.6 4.6 Residential fixed investment 28.2 10.0 7.0 -6.0 2.3 8.1 3.1 Change in net exports' 4.1 -21.8 -7.8 -5.2 9.9 -43.1 -24.9 Government purchases -.1 -4.9 -1.2 6.7 -4.1 -1.0 -1.0 Addenda Savings rate (percent of disposable income) 4.0 3.6 4.1 4.1 4.6 -2.2* .62 Industrial production 5.3 7.0 6.2 4.9 6.0 3.6 6.0 Capacity utilization rate (level) 82.3 83.2 83.8 84.3 84.9 1.22 Civilian unemployment rate (level) 6.5 6.6 6.2 6.0 5.6 -82 -1.0* Change in nonfarm payroll employment (thousands) 608 613 1,019 913 873 2,235 3,418 Change in manufacturing payrolls (thousands) -9 31 47 59 105 -119 242 PRICES Consumer price index Total 3.3 22..11 2.6 3.6 2.2 2.7 2.6 Excluding food and energy 2.8 2.9 3.0 3.0 2.3 3.1 2.8 Producer price index Finished goods -.1 2.7 .2 2.1 .3 .2 1.3 Excluding food and energy -.6 2.9 1.9 1.9 .0 .2 1.7 Intermediate goods .8 2.2 1.6 5.0 6.5 1.1 3.8 Implicit GDP deflator 1.3 2.9 2.9 1.9 1.3 1.8 2.3 Fixed-weight GDP index 2.6 2.9 3.2 2.8 2.8 2.8 2,9 Employment cost index 3.4 3.0 3.3 3.3 2.6 3.4 3.1 NOTE. Data are as of April 12,1995. 1. Billions of 1987 dollars. 2. Change in rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Policy and Open Market Operations during 1994 573 Although the slack in the economy steadily The Committee again limited the size of the move diminished, aggregate price increases for final to avoid any overreaction in the financial markets. goods and services remained modest. Inflation, as A third slight upward adjustment in reserve presmeasured by the fixed-weight GDP deflator and the sures was made between meetings in mid-April. consumer price index, showed no deterioration; At the May meeting, with the economy evidently increases in producer prices for finished goods expanding on a solid and self-sustaining basis, the remained low; and labor cost increases were FOMC voted to have the full ^-percentage-point restrained. Nonetheless, evidence accumulated that increase in the discount rate that had been approved price pressures could be intensifying. Producer that day by the Board of Governors show through price increases at the intermediate stage of produc- to reserve conditions. The Committee felt that tion accelerated, and manufacturers increasingly financial markets could absorb this more aggresreported paying higher prices for their inputs. sive policy adjustment. The Federal Reserve press release announcing these moves stated that "these actions, combined with the three adjustments initi- Policy Initiatives ated earlier this year by the FOMC, substantially remove the degree of monetary accommodation The initial monetary policy move came at the Feb- that prevailed throughout 1993." ruary FOMC meeting; it represented the first At the conclusion of the July FOMC meeting, at change in reserve conditions since September 1992 which no policy change was initiated, a Federal and the first move toward tightening since early Reserve press spokesperson indicated that the 1989. The Committee adopted a limited measure, meeting had adjourned and that no further associated with a V^-percentage-point rise in the announcement would be made. The Committee federal funds rate, because of the likelihood that authorized this step to avoid uncertainty about its this first step toward firming policy in some years intentions. Similar statements were authorized folmight be magnified in the financial markets. At lowing the other two Committee meetings at which the same time, it was felt that this action would no rate actions were taken. effectively signal the Committee's anti-inflation The FOMC next raised reserve pressures at intentions. its August meeting, when the full amount of a In a departure from past practice, the Chairman V^-percentage-point hike in the discount rate of the FOMC issued a brief public statement approved by the Board that same day was passed announcing this policy decision to avoid misinter- through to reserve markets. A Federal Reserve pretation of the Committee's actions by market press statement indicated that "these measures participants. Similar brief statements were issued were taken against the background of evidence of on a case-by-case basis to announce the other continuing strength in the economic expansion and FOMC policy changes during 1994.2 high levels of resource utilization," and went on to The Committee raised reserve pressures slightly add that "these actions are expected to be suffifurther at its March meeting, with the federal funds cient, at least for a time, to meet the objective of rate expected to rise another lA percentage point. sustained, noninflationary growth." The economy continued to display considerable forward momentum over the autumn, and there was some sense that past policy actions might be 2. Most announcements of policy changes were made early in the afternoon, shortly after the FOMC had completed its meeting. having less effect than expected, even in sectors However, at the two-day meeting in February 1994, the announce- believed to be especially sensitive to interest rate ment was made in the morning on the second day, soon after the increases. At its November meeting, the Commit- Committee made its decision. In that instance, the Committee preferred to make the information available before the weekend tee agreed that a substantial firming in policy was and ahead of the Desk's regular 11:30 a.m. operating time. The one appropriate. In its final policy move of the year, the policy action taken between meetings was also announced in the Committee voted to pass through to reserve condimorning. In February 1995, the Committee formally adopted new proce- tions the full effect of a 3/4-percentage-point hike in dures for conveying information to the public. The procedures the discount rate approved that day by the Board of include the announcement of all changes in the stance of monetary Governors. policy on the day the changes are made. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

574 Federal Reserve Bulletin • June 1995 Financial Market Developments to have brought policy to a more neutral position, and they encouraged brief rallies in debt markets. Interest rates across the maturity spectrum rose Driven largely by a spate of strong economic sharply in 1994. Yields on Treasury coupon securi- statistics, interest rates across most maturities ties ended the year 150 to nearly 350 basis points resumed their climb from September to early higher than they were a year earlier, while the November, rising 65 to 85 basis points. Measures coupon yield curve flattened substantially. of resource utilization notched higher, and a string Yields rose dramatically in the first few months of reports showing a resilient housing sector raised after the Federal Reserve began to tighten policy in questions about the impact of previous interest rate early February. By mid-May, the yield on two-year hikes. Survey results of input price pressures faced Treasury notes had risen about 180 basis points, by manufacturers continued to flash warning sigand the thirty-year bond yield was up more than nals. By late autumn, it was widely felt that the 110 basis points. Market analysts sensed that the economy was bumping up against its long-run economy retained significant forward momentum capacity limits, and many traders began to fear that and anticipated that the Federal Reserve would the Federal Reserve was falling behind in its efforts respond forcefully to ward off inflationary pres- to rein in inflationary pressures. In late October, the sures. Consequently, rates on many short- and yield on the most recently auctioned thirty-year intermediate-term securities rose, and a wide Treasury bond exceeded 8 percent for the first time spread emerged between these yields and the fed- in more than two years. eral funds rate. From just before the November FOMC meeting Longer-term yields also rose as investors grew until year-end, the Treasury coupon yield curve anxious over whether the gains made in reducing flattened further. Short-term Treasury n coupon inflation in recent years might begin to erode. Mar- yields rose another 65 basis points, while longket participants focused on the inflation risks posed term yields edged down about 20 basis points. The by the shrinking degree of economic slack, and Committee's action in November, viewed by marthey were disturbed by information appearing in ket participants as aggressive, and continued strong manufacturers' surveys, as well as evidence from economic statistics convinced most analysts that commodity price movements, that suggested an further policy tightening moves were in store and intensification of price pressures. Rising interest put upward pressure on shorter-term rates. Selling rates in European countries and weakness in the in the front end of the yield curve was exacerbated dollar spilled back and reinforced the upward by liquidations and hedging of portfolios made momentum in domestic yields. Hedging activity in unprofitable by higher interest rates. Adding to the the mortgage-backed-debt market, a sector particu- pressure was the disposal of the securities held by larly hard hit by the sharp rise in yields, lifted rates the Orange County, California, Investment Pool on intermediate-term Treasury securities.3 after its steep financial losses became known.4 From mid-May through August, yields moved in Meanwhile, the November policy action and cona broad trading range. Large rate movements were tinued favorable aggregate price statistics instilled often followed by abrupt reversals, a pattern that confidence that the Federal Reserve would succeed resulted in generally small net changes. Investors in preventing a significant increase in inflation presresponded to economic data that presented a mixed sure. This expectation helped to bring down longerpicture. Episodes of dollar weakness continued to term yields. weigh on sentiment, as they did intermittently The sharp increases in interest rates in 1994 also throughout the year. Meanwhile, the monetary pol- had profound effects on investor returns, financial icy adjustments in May and August were believed flows, and issuance in the fixed-income markets 3. Higher interest rates extended the expected durations of 4. Roughly $20 billion of securities held by the highly leveraged mortgage-backed securities, thereby compounding the downward Orange County fund were sold. Most of these securities were pressure on prices for this debt. Holders of mortgage-backed secu- government agency notes, many of them derivative instruments rities often hedge their exposures by selling intermediate-term that paid interest according to formulas based on movements in Treasury debt. market yields. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Policy and Open Market Operations during 1994 575 (table 3). Investors holding portfolios consisting of IMPLEMENTATION OF POLICY longer maturity securities sustained particularly heavy losses. The Lehman Brothers Long Treasury Operating Procedures Bond Index fell IVi percent, the first yearly decline in this measure since 1987 and the steepest decline in the twenty-two years spanned by the index. Net In 1994, the FOMC continued to express its policy returns for most categories of bond mutual funds directives in terms of a desired degree of reserve were negative in 1994, in many cases after the pressure. Reserve pressure effectively refers to the funds posted strong earnings the previous year. costs and other conditions under which the Federal Throughout 1994 there were reports of institutions Reserve makes reserves available to the banking suffering steep financial losses in domestic securi- system. The FOMC has informally used the federal ties markets. In some cases, the losses were linked funds rate as a guide for evaluating conditions of to exposures to derivative instruments that magni- reserve availability since the late 1980s. fied the effect of yield movements on interest In addition, the FOMC has continued to express payments. reserve pressures in terms of borrowed reserves, an Efforts to reduce exposure to rising interest rates approach that involves using nonborrowed reserves spurred huge reinvestment flows in financial mar- to satisfy most, but not all, of the demand for kets. Redemptions from bond mutual funds soared reserves, while forcing banks to meet remaining following a year of heavy inflows, and withdrawals needs at the discount window, where access is frequently outpaced inflows as investors reacted to rationed. When the FOMC has increased (or reports of poor performance. The growth in non- reduced) reserve pressures without a change in the competitive awards at Treasury auctions suggested discount rate, expected borrowing has been that many participants began to redirect their in- adjusted upward (or downward) accordingly. The vestments into securities markets. A heightened adjustments have been based on the premise that sense of uncertainty in financial markets accompa- the more the banks are forced to borrow at the nied these elevated flows. Implied price volatility discount window to meet their demand for reserves, in longer-term Treasury issues was substantially the more they will bid up the federal funds rate higher in 1994 than in 1993. Meanwhile, new relative to the discount rate. issuance in major sectors dropped significantly, in In the late 1980s, however, the relationship part reflecting higher borrowing costs. weakened appreciably, in part because a series of banking crises had encouraged observers to associate discount window borrowing with financial 3. Measures of performance and activity in domestic difficulties. As a result, banks became extremely securities markets reluctant to borrow. Although the banking crises have passed and the association of discount window borrowing with financial problems presumably has faded somewhat, banks apparently still have a reluctance to utilize their borrowing privileges. Consequently, if borrowing were forced to higher levels, the federal funds rate probably would rise substantially more than it had in the past. Against this background, the Desk has continued to develop objectives for nonborrowed reserves calculated as estimated demands for total reserves less the allowance for adjustment and seasonal borrowing. Whenever actual discount i on longer-run Treasury issues are based on the 1 window borrowing has differed significantly from Brothers Long Treasury Bond Index and reflect changes in principal value the allowance, however, the Trading Desk has and coupon income. Returns for the various categories of mutual funds are from Lipper Analytical Services, Inc. Debt issuance data are from Securities accepted the deviation and informally modified the Data Company. Mutual fund flow data are from the Investment Company nonborrowed reserve objective accordingly, rather Institute. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

576 Federal Reserve Bulletin • June 1995 than force unwanted changes in the federal funds deposit rates. Nonetheless, seasonal borrowing was rate.5 persistently higher than in recent years; it averaged Between February and April, the FOMC's $193 million in 1994, compared with $109 million reserve tightening actions lifted the anticipated the year before. It still followed the typical seaspread between the federal funds and discount rates sonal pattern, which reflected demands for agriculfrom zero, where it had been since September tural loans. As a result, the Desk made ten upward 1992, to 75 basis points. The spread remained at technical adjustments to the formal borrowing 75 basis points for the balance of the year because allowance between May and August 1994 and nine the last three policy steps involved equal changes downward adjustments over the remainder of the in both rates. year. The increased use of the program was related With this widening of the spread, borrowing in part to a marked rise in demand for farm credit at could have been expected to increase significantly. small banks. In addition, strong loan demand at However, adjustment borrowing actually decreased midwestern correspondent banks might have conslightly in 1994, averaging $65 million a day com- strained the correspondents' ability to provide pared with $75 million a day in 1993. Although the seasonal funding to their respondent banks.6 decrease is outwardly surprising, closer examination of the data shows some indications of the expected association between borrowing and the The Desk's Approach to Reserve funds rate. Adjustment borrowing did pick up on Management1 reserve-period settlement days, and it rose for most size classes of banks. Settlement-day adjustment Reserve Patterns over the Year borrowing averaged $336 million in 1994, almost double the $180 million average in 1993. Adjust- The behavior of narrowly defined money, Ml, had ment borrowing on nonsettlement days by smallan important influence on reserve supplies and and medium-sized banks also increased in 1994, demands over the year.8 Currency registered although by less than would have been expected on another year of strong growth, and the resulting the basis of historical relationships from the early record $37 billion increase in currency in circula- 1980s. Some of the shortfall in borrowing likely tion was the primary factor behind the substantial reflected a continuing reluctance to utilize the disneed to provide reserves in 1994.9 A decline in the count window, but the strong liquidity positions of deposit component, however, limited the overall many of these banks also may have played a role. growth of Ml and contributed to a fall in the Small- and medium-sized banks usually account demand for reserves. Consequently, required for a considerable portion of nonsettlement-day reserves, the primary source of demand, slipped borrowing. about $2 billion, reducing the need to add reserves The decline in average borrowing resulted over the year. entirely from a reduction in nonsettlement-day bor- Several other factors also modestly reduced the rowing by large money center banks. These banks Desk's need to provide reserves. Applied vault have traditionally concentrated their borrowing on cash, a source of supply, increased about $3 billion, settlement days, and in 1994 all of their borrowing in part mirroring the currency expansion. Rising occurred on those days. By contrast, members of interest rates led banks to cut their required clearthis group borrowed seven times on nonsettlement ing balances about $2 billion as the rate at which days in 1993, either because of operational difficulties or temporarily elevated funds rates. In the case of seasonal borrowing, the rate incentive for stepped-up borrowing in 1994 was small 6. Only small banks are eligible for the seasonal credit program. because the rate charged on seasonal borrowing 7. Many of the statistics cited in this section appear in tables in appendix C. closely tracked federal funds and certificate of 8. Changes in the components of Ml and the reasons for the components' behavior are described in appendix A. 9. Currency in circulation, which is the factor that affects 5. The borrowing relationship has been discussed more exten- reserve balances, includes cash held by depository institutions; for sively in previous annual reports of the Open Market Function. money supply calculations, however, this vault cash is subtracted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Policy and Open Market Operations during 1994 577 they accumulated earned income credits rose.10 For a second consecutive year, the Desk did not Because the declines were not offset by higher sell securities, although it did redeem some. excess reserves, the lower clearing balances less- Because the Treasury no longer sells seven-year ened the overall need to provide reserves. These notes, the System's holdings of these notes must be balances had been increased sharply in 1991 and redeemed early in each quarter as they mature; 1992, when banks were adapting to lower required more than $2 billion came due in 1994. The Desk reserve levels, and had been lifted modestly in also redeemed agency securities when no suitable 1993.11 On balance, cumulative changes in other replacement securities were offered and when supply and demand factors had smaller effects on issues were called. Holdings of these issues fell for total reserve needs over the year.12 the fourteenth year in a row, declining almost $1 billion, to $3.6 billion. As a result of the Desk's outright activity, total Outright Transactions and Changes holdings in 1994 grew $32 billion, to $376 billion. in the System Portfolio Although somewhat less than the record rise of 1993, this increase was still the second highest The Trading Desk met the ongoing need to add ever. Slightly more than half of the increase reserves by increasing the Federal Reserve Sys- occurred in Treasury bills, while growth in coupon tem's portfolio of U.S. government securities. Alto- holdings was strongest in the one-to-five-year secgether, the Desk purchased about $25 billion tor. Consequently, the weighted-average maturity through six operations conducted in the market, of the System's holdings was virtually unchanged four of them involving Treasury coupon issues.13 in 1994.14 As in the past, the market entries were arranged when available forecasts suggested that large reserve shortages would persist for at least several Temporary Operations maintenance periods. The market purchases were supplemented by nearly $11 billion of acquisitions The Desk used self-reversing operations to meet from foreign accounts, almost entirely Treasury the reserve shortages that developed between its bills. These purchases, typically modest in size, outright operations and to address reserve imbalwere arranged when orders were compatible with ances created by short-lived movements in other estimated reserve needs. factors affecting reserves. Almost all of the temporary operations in 1994 added reserves because of the underlying growth in reserve shortages and the 10. Earned income credits accumulate at a rate linked to the federal funds rate. The credits may be used only to pay for certain Desk's preference for letting deficiencies build to a priced services provided by the Federal Reserve, and many large sizable level before arranging outright purchases. banks hold clearing balances sufficient to generate credits to pay for In fact, the Desk entered only one maintenance all the services they use. As the rate at which the credits are earned increases, the maximum useful level of a bank's clearing balance period facing an estimated need to drain more than decreases. a very small amount of reserves, and even that 11. Technically, clearing balances are treated as a factor reducsurplus was subsequently erased by revisions to ing the supply of reserves, although they are actually a source of demand for reserves. forecasts of operating factors. Consequently, only 12. The various foreign-exchange-related activities on the Sys- five matched sale-purchase agreements were tem's balance sheet drained less than $0.5 billion. The historical arranged all year, and none exceeded one business value of the foreign currency sold was $3.0 billion, about $0.7 billion below the market value. The value of the System's foreign day. exchange holdings was increased $2.4 billion as a result of upward All told, the Desk arranged $362 billion of repurrevaluations, while interest earnings totaled $0.9 billion. In the chase agreements (RPs) for the System and reserve factor categories, interest earnings and the historical value of foreign currency transactions appear under "foreign currency," $113 billion that were customer-related. The numwhile revaluations and the profit or loss on foreign currency trans- ber and average size of multiday System RPs both actions appear in the "other items "category. fell in 1994. Several factors contributed to these 13. The Desk bought, in par values, $3.3 billion of Treasury coupon securities on March 15, $5.0 billion of coupons on April 12 (a record volume), $3.8 billion of bills on June 1, $4.5 billion of coupons on August 30, $3.9 billion of bills on November 9, and 14. The average maturity of the portfolio is also affected by the $4.2 billion of coupons on November 29. reinvestment choices made for maturing securities at auctions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

578 Federal Reserve Bulletin • June 1995 declines. A greater share of the year's reserve weekend was the main contributor to soft funds needs was met with outright operations: The Desk rates on Fridays. typically made outright purchases that left a In 1994, banks used these reserve management remaining estimated need to be met with RPs, but practices less aggressively. By the end of 1993, on several occasions actual needs fell below the rapid growth in required reserves and clearing balestimated needs. In addition, the Desk further ances had restored required operating balances to increased its use of fixed-term operations in 1994 the levels prevailing right before the initial round (discussed below), reducing the need for replace- of cuts in reserve requirement ratios in late 1990. ment RPs to offset early withdrawals. Perhaps as a result, the distribution of demands for excess reserves within a maintenance period appeared less skewed in 1994 than it had been in Managing Reserves within a Maintenance Period the preceding three years.17 Moreover, the degree of softness on Fridays was typically slight. None- When developing strategies for each maintenance theless, banks were still reluctant to accumulate period, the Desk took into account the estimated large excess reserve holdings early in a mainteday-to-day distribution of reserve shortages or nance period. By the end of 1994, the level of excesses, the potential for revisions to reserve esti- required operating balances had once again fallen mates, and bank reserve management strategies.15 back to the lower levels seen in late 1991 and in The Desk generally met each period's reserve 1992, thus reducing banks' reserve management needs gradually in order to accommodate some- flexibility. This decline reflected the drops in times uneven reserve distributions and possible required reserves and clearing balances and the revisions. It often arranged a series of multiday expansion in applied vault cash noted earlier. RPs, many of which matured in three or four days. The Desk further increased its use of fixed-term The Desk also continued to be guided by the fed- RPs on Thursdays to run through the weekend, a eral funds market. When faced with conflicting strategy that avoided the risk of large early withinformation between the funds rate and forecasts of drawals on Fridays if the federal funds rate traded reserve supply and demand, the Desk had to evalu- to the soft side while a large reserve need ate which indicator was likely to provide the more remained. The Desk believed that if withdrawable reliable information about reserve availability. RPs had been arranged on a Thursday, dealers Banks' reserve management strategies can affect probably would have opted to refinance at lower the funds rate because they influence reserve rates the next day, forcing the Desk to find another demands within a maintenance period. As several opportunity to add back the reserves. The Desk previous reports have explained, the cuts in reserve also expanded the use of fixed-term RPs on the first requirement ratios made between 1990 and 1992 Monday through Wednesday of each period, again reduced the level of required operating balances at to avoid unwanted withdrawals and to reduce the the Federal Reserve.16 These lower levels increased number of operations.18 Withdrawable RPs were the likelihood that depository institutions would be still useful at times, particularly when the Desk felt unable to eliminate unwanted excess positions that operating factors or required reserves might without running an overnight overdraft. Consequently, in the early 1990s, depositories tended to 17. The average levels of excess reserves in the first and second concentrate their reserve holdings late in a period, weeks of a maintenance period in 1994 were $725 million and showing particular caution about holding excess $1,375 million respectively. During 1993, the corresponding figreserves over the weekend, when reserves count for ures were $170 million and $1,980 million, and a similar distribution characterized 1992 after the round of reserve requirement cuts three days. This reluctance to hold reserves over a made in April of that year. Before December 1990, the distribution of excess reserves within the maintenance period was, on average, fairly even. Of course, Desk reserve provision strategies, which 15. The accuracy of the staff forecasts for reserve supply and may not match ex ante demands, also contribute to the actual demand is reviewed in appendix B. pattern of excess reserves. 16. Required operating balances are defined as required reserves 18. A total of forty-four fixed-term RPs were arranged in 1994 plus required clearing balances less applied vault cash; they repre- (thirty of which were in place on Fridays), compared with thirtysent the working balances held by depository institutions at the one in the previous year (twenty-three covering Fridays). By con- Federal Reserve for supporting payment transactions. trast, just nine fixed-term operations had been arranged in 1992. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Policy and Open Market Operations during 1994 579 turn out to be sufficiently different from estimates tions and to notify dealers of the results. The Desk to sharply reduce or eliminate the estimated reserve started using TRAPS for its temporary operations need. Thus, withdrawable RPs continued to be used in July, followed in August by the first outright over the final few days of many maintenance market purchase using the system. periods. Market speculation during the year that monetary policy might be tightened sometimes put Daylight Overdraft Pricing upward pressure on the federal funds rate that did not seem justified by estimates of reserve imbal- On April 14, the Federal Reserve began charging ances. The Desk remained sensitive to these situabanks a fee of 10 basis points on overdrafts tions when formulating its operations strategy to incurred in their reserve accounts during the day.21 avoid any misunderstanding by market partici- Previously, daylight overdrafts had been subject to pants, who continued to view open market operasize limitations related to a bank's capital, but they tions as a possible indicator of policy shifts.19 were not subject to charges. For a few banks, such Consequently, on several occasions when the funds daylight overdrafts were substantial. The Trading rate was very high, the Desk arranged overnight Desk anticipated that the charges might affect its System RPs, in part to prevent any perception that own operations by encouraging changes in the it was either paving the way for a firming in policy functioning of the federal funds and RP markets or hinting at a Committee inclination to change and in some banks' reserve management techpolicy.20 As the year progressed and market ananiques. In preparation for pricing daylight overlysts began to assume that the FOMC would indidrafts, Federal Reserve personnel had conversacate its policy actions through a public announcetions with market participants and undertook some ment, market participants came to feel that the contingency planning. As it turned out, however, Desk's open market activities were less likely to be Desk operations were minimally affected in 1994. used to communicate policy shifts. This perception Before charges were assessed for daylight overgave the Desk more flexibility in selecting its drafts, reserve management was focused on end-ofoperations to meet its reserve objectives. day reserve balances rather than on intraday balances. End-of-day balances are important because they meet reserve requirements. Furthermore, Trading Room Automated Processing System banks need reserve balances at the end of the day to avoid overnight overdrafts and their associated stiff In 1994, the Desk began arranging its open market charges. In fact, total reserve balances vary considoperations using the Trading Room Automated erably during the day, rising whenever the Federal Processing System (TRAPS). Under TRAPS, the Reserve or any entity maintaining an account at Desk announces reserve operations and dealers the Federal Reserve—the federal government, fedrespond with their propositions through Fedline erally sponsored agencies, or foreign official terminals. The system is also used to process operainstitutions—makes payments and falling whenever it receives payments.22 The most dramatic movements in intraday balances, however, have 19. Misinterpretations did in fact arise. On February 3, with fed been in the distribution of reserves, with large funds trading just Vi6 of a percentage point above the level associated with the desired degree of reserve pressures, the Desk took no market action to affect reserves because a shortage was not seen. With an FOMC meeting scheduled to start later that day and with expectations of a policy shift running high, some participants 21. The fee reflects an annual rate of 24 basis points using a interpreted the Desk's inaction as indicating such a shift. In fact, standard ten-hour day for Fedwire operations. The charge is made this was not the case, although the FOMC did decide to firm on all end-of-minute overdrafts in excess of a deductible based on pressures the following day. This episode occurred before the 10 percent of the bank's capital. The "Overview of the Federal FOMC began to announce policy changes. Reserve's Payments System Risk Policy," published by the Federal 20. With expectations , of an easing in policy almost entirely Reserve System in October 1993, describes the calculations in absent in 1994, the Desk felt freer to add reserves when called for detail. by its reserve projections, even when the funds rate was slightly 22. Differences in posting times for check credits and debits also soft. It did so on numerous occasions. influence aggregate intraday reserve levels. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

580 Federal Reserve Bulletin • June 1995 intraday balances occurring at some banks and lence of this timing pattern caused both the dealers' huge overdrafts at others during part of the day.23 and their banks' accounts to be overdrawn during The previous absence of fees had encouraged the morning because the dealers began the day with practices that resulted in large daylight overdrafts. small working balances. In anticipation of daylight For example, many financial market transactions, overdraft pricing, the clearing banks informed their such as interbank federal funds and RP contracts, customers that they would pass on the overdraft did not specify transaction settlement times. Yet charges. receipt and return times do influence the intraday Dealers indicated in conversations with the Feddistribution of reserves. In federal funds transac- eral Reserve that they planned to speed up their tions, the sending bank controls the timing of the negotiation and processing of RPs in the morning reserve transfer. Under daylight overdraft pricing, so that any securities being returned and then refiit was thought that banks facing intraday reserve nanced would leave their accounts more quickly. charges might delay sending federal funds in order Some participants predicted that this speedup in RP to increase their intraday balances. If Fedwire traf- operations would cause the market to be liquid fic became concentrated near the end of the day, the only briefly early in the morning. Such a developfunds market could lose liquidity, thus making the ment was of particular concern to the Federal rate a less reliable indicator of reserve availability. Reserve because the Desk's temporary open mar- In practice, however, after daylight overdraft ket operations are routinely executed around pricing began, the average time for sending funds 11:30 a.m. The Federal Reserve had chosen that transfers over Fedwire moved only slightly to later time because information about reserve levels is in the day. Apparently, many banks did not change received and analyzed gradually over the morning. their practices because they did not face large Only part of the data flow could be accelerated. If enough daylight overdrafts from their funds trans- the Desk were forced to arrange its open market actions to justify the cost of making changes. Fed- operations a couple of hours earlier, it would have eral funds brokers did report that some requests for to base its decisions on less reliable data. transactions specified sending or returning funds To address these concerns, the Desk did make during specific time periods and noted that some one change in its procedures: It delayed the return potential trades were rejected because the counter- time for the collateral on its own maturing RPs party was reputed to be a "late sender." But these from the opening of business until 11 a.m., thereby restrictions affected only a small portion of trades leaving reserves in the banking system for a larger and therefore did not impede market liquidity. part of the day. It was hoped that the later return For securities transactions, the sender of the time would encourage the dealers to participate in securities controls the transaction time. Conse- the late morning operations. quently, banks lose reserve balances when they Once pricing began, the RP market did experireceive securities, but they cannot control the time ence a shift toward somewhat more morning activat which that happens.24 Dealers, who rely heavily ity, but a number of customers continued to seek on RPs to finance inventories, traditionally had RP investments during the late morning and early their clearing banks send the securities to their afternoon, so market liquidity was retained. More counterparties' custody banks between late morn- rapid processing of trades has accounted for most ing and early afternoon. Then, on the maturity date, of the reduction in peak and average overdrafts.25 the counterparties' banks typically returned the In addition, the volume of afternoon trades for next securities at the opening of business. The preva- day delivery has increased. The Desk saw essentially no change in participation rates in its RP operations after April. Dealers 23. In the six months before daylight overdraft charges took effect, peak overdraft levels averaged $124 billion. From mid-April reported somewhat smaller inventories of securities through year-end, they averaged $70 billion. To put the overdraft left to be financed at midmorning, but on most figures in perspective, total end-of-day reserve balances averaged days, they were nonetheless able to submit proposi- $34.5 billion and $31 billion respectively, over those two periods. 24. Under the delivery-versus-payment system used for the transfer of government securities, reserve balances are automatically moved from the account of the bank receiving the securities to 25. Average daylight overdrafts fell from $70 billion in the six that of the bank sending them when the transfer is processed. months before pricing to $43 billion over the balance of 1994. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Policy and Open Market Operations during 1994 581 tions of sufficient size for the Desk to accomplish increased their issuance of both overnight Eurodolits planned operations. Furthermore, dealers' cus- lars and RPs, thus lifting M2. In addition, during tomers increased their participation in Trading the second half of the year, issuance of consumer Desk operations. time deposits picked up, as did growth in retail money market mutual funds. M3 received some support from large time deposits and term RPs and APPENDIX A: THE MONETARY AGGREGATES Eurodollars, while institutional money funds were very weak early in the year but showed more Growth of the broader monetary aggregates robust growth later. The strength in some of these remained subdued in 1994. The FOMC voted in components reflected expanded bank funding February to retain the growth ranges for M2 and needs. Total bank credit rose 6.8 percent in 1994, M3 adopted on a preliminary basis the previous after having grown 5.0 percent the previous year. summer. These ranges were consistent with the The increase was concentrated in bank lending; expected slowing of nominal income and the antici- aggregate holdings of securities fell modestly on pated continuation of the substantial velocity balance over the year.29 increases experienced in recent years. The FOMC After three consecutive years of rapid growth, reaffirmed these ranges in July. For the entire year, Ml rose only 2.4 percent in 1994. The slowdown M2 advanced a mere 1.0 percent, at the lower end in part reflected substantial increases in opportunity of its annual growth cone, while M3 rose only costs, which depressed deposits. Reduced mort- 1.2 percent, within the lower half of its annual gage refinancing activity also weakened demand growth cone.26 Growth in the broader aggregates deposits, and sweep programs initiated by several was held down in 1994 by weakness in the liquid banks lowered other checkable deposits.30 But curcomponents, including savings and interest-bearing rency, buoyed by heavy shipments overseas, regischeckable deposits.27 These deposits were rela- tered another year of strong growth, expanding tively unattractive because depositories raised rates about 10 percent over the four quarters. at a much slower pace than market rates rose.28 The Finally, domestic nonfinancial debt grew 5.3 perpreference for market investments and the resultant cent in 1994. The improved balance sheet conincrease in velocity were factors in the Commit- dition of many borrowers supported growth of tee's decisions to accept the weak aggregates. nonfederal debt. Total debt ended the year toward Some components of the broader aggregates, the lower end of its monitoring range. however, did show strength. Depositories sharply APPENDIX B: RESERVE FORECAST ACCURACY 26. The data on all the monetary aggregates are as of January 26, 1995, and do not reflect the annual seasonal factor and benchmark revisions of February 2. The earlier data are used because This appendix reviews the accuracy of staff forethey more closely approximate the information the Committee had casts of the factors affecting reserve supply and when it made its policy decisions. The revisions generally had a demand. For the year, the accuracy of the forecasts minimal effect on total growth over the year. On balance, the revisions redistributed a little more of the net increases in Ml and for required reserves was similar to that for 1993 at M2 into the first half of the year and shifted more of the growth in each stage of the maintenance period (table B.l). M3 into the second half of the year. The annual changes of the The Desk maintained a formal allowance of $1 bilmonetary aggregates are measured from the fourth quarter of 1993 to the fourth quarter of 1994. Data on noniinancial debt reported in this section are as of March 3, 1995. 27. The behavior of the monetary aggregates is described in more detail in the "Monetary Policy Report to the Congress Pursu- 29. Credit expansion was partially funded by bank borrowings ant to the Full Employment and Balanced Growth Act of 1978" from abroad, which nearly doubled over the year. (Board of Governors of the Federal Reserve System), July 20, 30. In January, one large regional bank initiated a sweep pro- 1994, and February 21, 1995. gram that transferred funds from other checkable deposits into 28. Investors moving out of mutual funds favored instruments money market deposit accounts. Another large regional bank not included in the aggregates, such as the direct purchase of phased in a similar program during September and October. Alto- Treasury debt. For this reason, and because of capital losses suf- gether, these programs lowered Ml growth about 1 percentage fered by many funds, M2 plus bond and stock mutual funds rose point in 1994. The sweep programs shifted funds between accounts less than 1 percent in 1994, an increase similar to that for M2 and included in M2 and therefore had no effect on the broader well below the nearly 7 percent gain of the previous year. aggregates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

582 Federal Reserve Bulletin • June 1995 lion for excess reserves during each of the twenty- $8 billion to $10 billion higher than it was a year six maintenance periods in 1994, but it often made earlier, making room for more tax receipts. In informal allowances when demand for excess December, approximately $35 billion of Treasury reserves was expected to be above or below the cash management bills matured without replacepath allowance.31 ment, compared with $14 billion in December On average, the estimates available at the begin- 1993. The enlarged maturities limited the size of ning of the period of the factors affecting the the Treasury's total cash holdings. supply of nonborrowed reserves improved. The Another factor reducing measured forecast errors smaller forecast errors largely resulted from better was a decline in average premiums on RPs and on estimates of the Treasury balance and less distor- coupon securities purchased, elements in the "other tion from the treatment of premiums on RPs, while items" category. The measured impact of any currency projections showed some deterioration. reserve transaction is based on the par value of the There was a marked improvement in the first-day securities, although the actual impact depends on estimates of the Treasury's balance at the Federal the market value of the securities. In practice, the Reserve in 1994, particularly around the important Desk allows for possible net premiums (premiums September and December tax payment dates. A less discounts) when they are expected to be large, surge in tax receipts can cause the Treasury's total so that the premiums do not constitute actual forecash holdings to exceed the capacities of the Trea- cast misses. Average net premiums in 1993 had sury Tax & Loan (TT&L) note accounts at deposi- grown to 8 percent on all RPs and to 15 percent on tory institutions, with any excess flowing into the market purchases of coupons as a result of falling Treasury's balance at the Federal Reserve. Fore- interest rates. Because of rising interest rates in casting the balance in the Federal Reserve account, 1994, however, the average net premiums on secutherefore, can be particularly difficult around these rities held under RP fell back to about 2 percent of times. In 1994, Treasury cash levels were above the par value, with discounts outweighing premithe capacity of the TT&L accounts on fourteen ums on some operations. Average net premiums days, much less frequently than in 1993, when fell to 8 percent on coupons purchased in the capacity was exceeded on thirty-two days. Two market. developments accounted for much of the differ- Currency projections at the beginning of mainteence: In September 1994, the capacity was about nance periods deteriorated in 1994. Currency often behaved in a manner at odds with past seasonal patterns, which are used for forecasting purposes. 31. Excess reserves are estimated from a combination of models In the first and last maintenance periods of 1994, and observed behavior during maintenance periods. Any analysis typically times of large seasonal swings, currency of the accuracy of these estimates would be misleading because it would not take account of the informal revisions. drained fewer reserves than initially anticipated. B.l. Approximate mean absolute errors for various forecasts of reserves and operating factors Millions of dollars NOTE. A range indicates varying degrees of accuracy for the staff forecasts of the Federal Reserve Bank of New York and the Board of Governors. Values are rounded to the nearest $5 million. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Policy and Open Market Operations during 1994 583 APPENDIX C: C.2. System outright operations by type of transaction and counterparty TABLES SUMMARIZING 1994 DESK ACTIVITY Billions of dollars The tables in this appendix support the text discussion of the Trading Desk's approach to reserve management in 1994. The operating factors affecting bank reserves appear in table C.l. The Desk's outright operations are summarized in table C.2, and the operations' effects on the System portfolio are presented in tables C.3 through C.5. Temporary operations are reported in table C.6. C.l. Reserve measures and factors affecting reserves NOTE. Values are on a commitment basis. C.3. System portfolio: summary of holdings — of dollars NOTE. Values are on a commitment basis. Changes in holdings are from year-end to year-end. Figures may not add to totals because of rounding. NOTE. Figures may not add to totals because of rounding. 1. Change from maintenance period ended January 5, 1994, to that ended January 4, 1995. 2. Change from maintenance period ended January 6, 1993, to that ended January 5,1994. 3. Not adjusted for changes in required reserve ratios. 4. Indicates impact of changes in operating factors on bank reserves. All items are biweekly averages. 5. Matched sale-purchase agreements with foreign accounts are added back in. 6. Acquisition value plus interest. Revaluations of foreign currency holdings are included in "other items." 7. Includes customer-related repurchase agreements. (Tables C.4-C.6 appear on page 584.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

584 Federal Reserve Bulletin • June 1995 C.4. System portfolio of Treasury and federal agency securities, selected years, 1960-94 NOTE. Figures may not add to totals because of rounding. Values are on a 1. As percent of total System Account portfolio, commitment basis. C.5. Weighted-average maturity of marketable Treasury C.6. System temporary transactions debt, selected years, 1960-94 Percent Months 1. The effects of all outstanding temporary transactions, including repurchase agreements and matched sale-purchase agreements with foreign accounts, are excluded from the calculation of the average maturity of the NOTE. Figures may not add to totals because of rounding. portfolio. 1. Number of rounds. If the Desk arranged repurchase agreements with two different maturities on the same day, the agreements are treated as one round. The Desk arranged such multiple repurchase agreements on two days in 1993; none were arranged in 1994. 2. Volumes exclude amounts arranged as customer-related repurchase agreements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

585 Treasury and Federal Reserve Foreign Exchange Operations This quarterly report describes Treasury and Sys- SHIFTING EXPECTATIONS TAKE THE DOLLAR tem foreign exchange operations for the period TO NEW LOWS from January through March 1995. It was prepared by Peter R. Fisher, Executive Vice President, Fed- At the end of 1994 many market participants eral Reserve Bank of New York, and Manager for expected that the dollar would continue to appreci- Foreign Operations, System Open Market Account. ate into 1995. These expectations were based on a Claudia Corra was primarily. responsible for belief that short-term U.S. interest rates would conpreparation of the report.1 tinue to rise and, as a result, interest rate differentials would widen in the dollar's favor. German During the first quarter of 1995, the dollar declined monetary policy was expected to remain steady 11.3 percent against the German mark, 13.1 per- through the first part of 1995, in turn, suggesting cent against the Japanese yen, 0.2 percent against that exchange rate movements within Europe the Canadian dollar, and 7.8 percent on a trade- would remain subdued. At the same time, market weighted basis.2 On March 2, the U.S. monetary participants anticipated that Japan's current account authorities intervened in the foreign exchange mar- surplus would contract as Japan's economic recovkets, purchasing $300 million against the Japanese ery took hold in 1995, while the U.S. current yen and an equal amount against the German mark. account deficit would stabilize. During the first The US. monetary authorities entered the market quarter of 1995, however, the expectations that had again on March 3, purchasing $450 million against supported the dollar in late 1994 started to unwind, the German mark and $370 million against the and the dollar declined to historical lows against Japanese yen as part of a concerted operation to the mark and the yen. support the dollar. In other operations, Mexico drew a net $1 billion on its swap facility with the Federal Reserve and a net $4 billion on the U.S. INTEREST RATE EXPECTATIONS SUBSIDE Treasury Department's Exchange Stabilization WHILE THE MARK STRENGTHENS Fund (ESF), of which a net $1 billion represented WITHIN EUROPE drawings from short-term facilities and $3 billion from the ESF's medium-term facility. These draw- Having closed the previous quarter at DM 1.5490 ings were part of the $20 billion financial aid and ¥99.55, the dollar declined in a steady but package to Mexico, which the Clinton Admin- orderly fashion through mid-February, falling istration announced on January 31 and signed on 4.4 percent against the mark to DM 1.4810 and February 21. 2.3 percent against the yen to ¥97.27. The decline reflected various factors operating in the economies of the major currencies. In the United States, lowerthan-expected housing, retail sales, and nonfarm payroll data provided initial signs that economic 1. The charts for the report are available on request from Publi- growth was slowing to more sustainable levels. cations Services, Mail Stop 127, Board of Governors of the Federal Expectations for additional U.S. interest rate Reserve System, Washington, DC 20551. 2. The dollar's movements on a trade-weighted basis in terms of increases faded further after the January 31other Group of Ten (G-10) currencies are measured using an index February 1 Federal Open Market Committee developed by staff at the Board of Governors of the Federal (FOMC) meeting, at which the Federal Reserve Reserve System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

586 Federal Reserve Bulletin • June 1995 decided to raise both the discount and federal funds recovery spread, Japanese stocks came under sellrates 50 basis points to 5.25 percent and 6.00 per- ing pressure and the Japanese bond market began a cent respectively. After this hike, market partici- sustained rally. The announcement that Barings pants came to expect that monetary policy would PLC was being placed in administration, together remain on hold through the March FOMC meeting with the subsequent liquidation of the firm's long and possibly through the May meeting as well. positions in Nikkei stock index futures, placed This downward revision in expected U.S. interest additional short-term pressure on Japanese stocks. rates contributed to the dollar's decline. In Europe Throughout the early part of the quarter the the German mark began to appreciate sharply Mexican financial crisis also hurt dollar sentiment against other European currencies. The prospect of in at least two ways. First, the U.S. trade deficit was higher-than-expected wage settlements in Germany expected to increase as a result of a protracted and upward-trending German producer price data economic crisis in Mexico, adding pressure to led many market participants to expect an end to the dollar. Second, the Mexico crisis, coupled the Bundesbank's easing cycle or perhaps even a with weaker Canadian financial markets, caused near-term tightening. Perceived political and fiscal many overseas investors to develop an aversion to problems in Italy, Sweden, and Spain led to some all North American assets, including dollarflight to the German mark from the Italian lira, denominated assets. Moreover, that aversion grew Swedish krona, and Spanish peseta. as the availability and viability of the first U.S. In Japan analysts began to revise down their financial assistance package, which was initially near-term forecasts for Japanese growth after the reported on January 11, appeared to be losing concountry's severe earthquake on January 17. More- gressional support. Sentiment turned more positive over, Japanese economic data provided continuing with the January 31 announcement of a second evidence of weak domestic demand. As concerns package that also included funds from the Internaover another postponement in Japan's economic tional Monetary Fund (IMF) and the Bank for 1. Foreign exchange holdings of U.S. monetary authorities, based on current exchange rates Millions of dollars Quarterly changes ii balan ces by soun Balance Balance Dec. 31, 1994 Impact of Currency Mar. 31. 1995 sales3 income ad v j a u l s u t a m ti e o n n t s3 FEDERAL RESERVE Deutsche marks 13,405.2 -375.0 3.4 188.7 1.655.0 14,877.3 Japanese yen 8,510.0 -335.2 5.3 23.1 1.213.7 9.416.9 Mexican pesos4 .0 995.1 .0 4.9 -134.9* 865.1 Interest receivables* 116.3 127.3 Total 22,031.5 25,286.5 U.S. TREASURY EXCHANGE STABILIZATION FUND : marks 7,500.6 -375.0 3.4 103.2 916.6 8,148.8 < U,801.0 -335.2 5.3 29.1 1.696.1 13,196.3 .0 3,983.6 .0 16.4 .0s 4,000.0 Interest receivables6 64.9 88,0 Total 19,366.5 25*433.2 NUTE. Figures may nut sum to totals because uf ruunding. 4. See table 4 for a breakdown ul' Mexican swap activities. Nute that the 1. Purchases and sales include foreign currency sales and purchases investment income on Mexican swaps is sold back to the Bank of Mexico. related to official activity, swap drawings and repayments, and warehousing. 5. Valuation adjustments on peso balances do not affect profit and loss 2. Calculated using marked-to-market exchange rates; represents the dif- because the impact is offset by the unwinding of the forward contract at the ference between the sale exchange rate and the most recent revaluation repayment date. Note that the ESF does not mark to market its peso holdexchange rate. Realized profits and losses on sales of foreign currencies, ings, but the Federal Reserve System does. computed as the difference between the historic cost-of-acquisition exchange 6. Interest receivables for the ESF are revalued at month-end exchange rate and the sale exchange rate, are shown in table 2. rates. Interest receivables for the Federal Reserve System are carried at cost 3. Foreign currency balances are marked to market monthly at month- and are not marked-to-market until interest is paid. end exchange rates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Treasury and Federal Reserve Foreign Exchange Operations 587 International Settlements (BIS). Nonetheless, con- ment that "there may come a time when we hold tinued political debate within the United States our policy stance unchanged, or even ease, despite over the existence and size of the assistance pack- adverse price data, should we see signs that age continued to weigh on market sentiment during underlying forces are acting ultimately to reduce much of February. inflationary pressures." Second, pressure within By February 17 the dollar traded to DM 1.4810, Europe's Exchange Rate Mechanism (ERM) cona level last reached in October 1992, and declined tinued to build, spurring demand for marks and to ¥97.27, a level last reached on November 9, taking the German currency to an all-time high on 1994. a trade-weighted basis. Besides the persistent strains on the Italian lira, the Swedish krona, and the Spanish peseta, the French franc came under THE DOLLAR'S DECLINE ACCELERATES pressure amid increased uncertainty ahead of the IN LATE FEBRUARY two-round presidential election in April and May, while sterling declined because of the perceived Starting in late February, the pace of the dollar's weakness of Prime Minister John Major's governdecline accelerated. First, comments by Federal ment. Third, expectations that dollar sales by Japa- Reserve officials reinforced the perception among nese corporations and financial institutions would market participants that the central bank might be accelerate up to the March 31 Japanese fiscal yearnearing, or might even have reached, the end of its end also weighed on the dollar. tightening cycle. In particular, market participants Several discrete factors contributed to negative interpreted comments by Federal Reserve Chairdollar sentiment in late February. First, comments man, Alan Greenspan, during his semiannual by several Federal Reserve officials between Febru- Humphrey-Hawkins testimony on February 22, as ary 28 and March 2 were perceived by market suggesting a significant change in tone. Attention participants as suggesting a lack of official confocused almost exclusively on the Chairman's comcern over the value of the dollar. Second, the defeat of the Balanced Budget Amendment created the perception—particularly among overseas 2. Net profits or losses (-) on U.S. Treasury and Federal Reserve foreign exchange operations, investors—that the United States lacked the politibased on historical cost-of-acquisition exchange rates cal will to reduce its chronic fiscal deficit. Third, Millions of dollars press reports suggesting that the United States US. Treasury would adopt a tougher stance toward Japan in Period St E a x b c i h liz a a n t g io e n ongoing trade talks also contributed to the dollar's Fund weakness. Valuation profits and bases on asofUecST,!^ ' 2,170.4 708.1 U.S. MONETARY AUTHORITIES BUY DOLLARS yen 2,407.2 AGAINST THE MARK AND YEN 4,577.6 4,052^4 profits tutd tosses As the dollar's decline accelerated in late February frQjtt fotfci&n cufTPttcy sales * Dec. 31, 19m94 -Mar. SI. 1995 and early March, portfolio managers began to liqui- 81.6 58.2 yen 105.6 105.9 date substantial long-dollar positions. Against a backdrop of reduced liquidity and limited risk 187.2 164.1 appetite, these flows added considerable momen- Valuation profits a tum to the dollar's decline. Moreover, as the dollar TofmTsTms1 tabl mes breached certain levels, some market participants 3,747.2 1469.8 3,520.5 4.939.9 were knocked out of their options positions, forc- Total 7,267.7 6,509.8 ing them to sell dollars quickly to reestablish protection against an even weaker dollar. 1. As indicated in table 1, foreign currency sales totaled $750 million against German marks and $670.4 million against Japanese yen. On the morning of Thursday, March 2, in ner- 2. Valuation profits or losses are not affected by peso holdings, which are vous and illiquid market conditions, the dollar fell canceled by forward contracts. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

588 Federal Reserve Bulletin • June 1995 precipitously—first against the yen and then against and the yen. Demand for marks increased after the the mark. By midday, the dollar had reached lows March 5 realignment of the ERM, in which the of ¥94.93 and DM 1.4348, declines of almost two central parity of the Spanish peseta was effectively yen and three pfennigs respectively from the previ- devalued by 7 percent and that of the Portuguese ous day's closing levels. That afternoon the Federal escudo by 3.5 percent. On Wednesday, March 8, Reserve Bank of New York's Foreign Exchange during Asian trading hours, the dollar reached new Desk entered the market on behalf of the U.S. historical lows of DM 1.3438 and ¥88.72. monetary authorities, purchasing $300 million The dollar started to stabilize later that day, after against the German mark and $300 million against official interest rate increases in several European the Japanese yen in an effort to help stabilize the countries and dollar-supportive statements by currency. The purchases were divided evenly senior monetary officials. On March 8, France, between the Federal Reserve and the Department Belgium, Denmark, and Portugal increased official of the Treasury's ESF. The dollar reached highs of short-term interest rates in an attempt to alleviate DM 1.4463 and ¥95.49 after the Desk entered the pressure on their currencies. Soon thereafter, market but closed the day at DM 1.4410 and Bundesbank President Tietmeyer stated that the ¥95.15. Bundesbank would see if there was "room for a On Friday, March 3, in early European trading, small interest rate cut" but added that the Bundesseveral European central banks intervened in con- bank would also consider the possibility of raising cert to support the dollar. At about 9:10 a.m., with the dollar trading at DM 1.4490 and ¥94.80, the 3. Currency arrangements Desk entered the market to purchase dollars against Millions of dollars marks and yen on behalf of the U.S. monetary Amount of Outstanding as of authorities. The Desk was joined by thirteen other Institution facility Mar. 31,1995 central banks in a conceited effort to support the FEDERAL RESERVE dollar. Also on March 3, Treasury Secretary Rubin RECIPROCAL ARRANGEMENTS confirmed the U.S. intervention and highlighted Austrian National Bank 250 National Bank of Belgium .... 1,000 A official concern over the dollar's recent decline by Bank of Canada 2,000 National Bank of Denmark ... 250 stating, "A strong dollar is in our national interest. Bank of England 3,000 That is why we have acted in the markets in Bank of France 2.000 Deutsche Bundesbank 6,000 concert with others. The administration is continu- Bank of Italy 3,000 Bank of Japan 5,000 ing its work on strengthening economic fundamen- Bank of Mexico1 Regular swaps 3,000 1,000 tals including bringing down the budget deficit Temporary swaps 3,000 further." Netherlands Bank 500 t Bank of Norway 250 During the day the Desk purchased $450 million Bank of Sweden 300 Swiss National Bank 4,000 against the German mark and $370 million against the Japanese yen. All the dollar purchases were Dollars against Swiss francs 600 divided equally between the Federal Reserve and Dollars against other authorized European currencies 1,250 the ESF. Throughout the day the dollar met aggres- Total 15,400 sive selling interest by market participants and proceeded to trade progressively lower, closing at U.S. TREASURY EXCHANGE DM 1.4250 and ¥94.08. STABILIZATION FUND Deutsche Bundesbank 1,000 0 Bank of Mexico1 Regular swaps 3,000 1,000 Temporary swaps ....... 1300 0 United Mexican States swaps' . 3.000 THE DOLLAR EVENTUALLY STABILIZES Total' AGAINST THE MARK BUT REMAINS UNDER PRESSURE AGAINST THE YEN 1. Facilities available to Mexico comprise regular and temporary shortterm swaps between the Bank of Mexico and both the Federal Reserve and the ESF, as well as medium-term swaps and government guarantees between In the week immediately after the intervention, the the government of Mexico and the ESF. The total amount available from both medium-term swaps and government guarantees is $20 billion, less any dollar continued to decline rapidly against the mark outstanding drawings on the short-term facilities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Treasury and Federal Reserve Foreign Exchange Operations 589 interest rates. Market participants noted that this time, but the rally was short-lived as the dollar was the first time in several months that President failed to break out of its March trading range, Tietmeyer had mentioned the possibility of another prompting fresh dollar sales. The following day, interest rate cut in Germany. Tietmeyer later added, March 31, the Bank of Japan allowed its overnight "In my view, the dollar was, and still is, under- call rate to fall to a historical low of 1.75 percent. valued. The deutsche mark is valued too high." Upward pressure on the yen continued, however, That same day, speaking before the House Budget with market participants expressing disappoint- Committee, Chairman Greenspan said, "The ment that the ODR had not been reduced. The weakness of the dollar against other major curren- dollar proceeded to fall to a new postwar low of cies is both unwelcome and troublesome. Dollar ¥86.30 on March 31 in somewhat illiquid trading weakness, while very likely overdone, is unwel- conditions. The dollar closed the quarter at come because it adds to potential inflation DM 1.3735 and ¥86.50. pressures in our economy." Market participants reacted positively to Chairman Greenspan's comments, as well as to additional dollar-supportive MEXICAN FINANCIAL MARKETS REMAIN comments by Treasury Secretary Rubin, because VOLATILE these statements helped assuage concerns that U.S. officials were unconcerned about the dollar. Over the period, the dollar rose 39.4 percent against Over the rest of the period the dollar traded in a the peso. The new peso reached a record low of range of DM 1.3730 to DM 1.4225 against the NP 7.65 on March 9 before recovering somewhat mark. during the latter part of the period. As the period Despite its modest rebound against the mark, the opened, uncertainty over the course of Mexican dollar remained under pressure against the yen macroeconomic policy and concerns over the throughout March. Sentiment toward the dollar impact of the devaluation on Mexico's banking continued to be negative, as market participants sector led market participants to attach a substantial focused on reports of capital repatriation by Japa- risk premium to Mexican financial assets, exacernese financial institutions and of dollar sales by bating already difficult trading conditions in Mexi- Asian central banks looking to rebalance reserves can money and foreign exchange markets. or cover yen-denominated liabilities. In addition, During the ensuing weeks, Mexican financial continued concerns about the Japanese current markets remained under pressure amid growing account surplus caused the yen to appreciate doubts about the prospects for passage by the sharply against the dollar. This upward pressure on U.S. Congress of the $40 billion loan guarantee the yen continued despite rising speculation of an package. On January 31, President Clinton imminent cut in the Bank of Japan's official discount rate (ODR). 4. Drawings and repayments (-) by Mexican monetary After the March 28 FOMC meeting, at which no authorities monetary policy announcement was made, the dol- Millions of dollars lar continued to drift lower. Although market participants expected that monetary policy would j Out- Outstanding standing Item Jan. Feb. Mar. remain steady, weak data on durable goods and Dec. 31, Mar. 31, 1994 1995 home sales provided additional evidence of slower . . . . growth, further solidifying market participants' Reciprocal currency | arrangements with views that the United States was approaching the the Federal Reserve Bank of Mexico end of its tightening cycle. (regular) • 0 500 1,000 -500 1,000 On March 30 the Bundesbank surprised the Currency arrangements markets with a cut of 50 basis points in its dis- with the US. Treasury Exchange Stabilization count rate, to 4 percent, and a cut of 35 basis points Fund in its repurchase rate for government securities, Bank of Mexico (regular) 0 500 1,000 -500 1.000 which had been fixed at 4.85 percent since July Medium-term 0 0 0 3,000 3.000 1994. The announcement supported the dollar for a NOIL. Data are <_>N a value-date basis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

590 Federal Reserve Bulletin • June 1995 announced a new $47.8 billion aid package that CANADIAN FINANCIAL MARKETS included participation by the IMF and the BIS. REMAIN UNDER PRESSURE Mexican markets initially rallied on the announcement but remained volatile amid worries that the During the period, the Canadian dollar reached a second package might be subject to congressional nine-year low of Can$1.4272 against the U.S. dolchallenge. lar before recovering late in the quarter to close Mexican financial markets started to recover in relatively unchanged at Can$ 1.3990. Canadian early March after the signing, on February 21, of financial markets remained under pressure because the $20 billion U.S. portion of the package. Other of ongoing fiscal concerns, fears of Quebec separatfactors also provided support, including Finance ism, and spillover from developments in Mexico Minister Ortiz's announcement of a strict new eco- and the United States. Moody's announcement that nomic program, which was well received by the it was reviewing Canada's foreign and domestic financial community, and the Bank of Mexico's debt rating for a possible downgrade heightened announcement of its intention to follow a tight and the negative sentiment. more transparent monetary policy. For the rest of Canada's fiscal year 1995-96 budget, released the quarter, Mexican markets remained nervous but on February 27, was well received by the market traded with a somewhat firmer tone. The peso because it met the planned 1996 target of 3 percent closed the period at NP 6.76 per dollar. of GDP and focused on increased spending cuts. The post-budget rally was short-lived, however, as market participants increasingly began to hold the view that the budget did not adequately address Canada's underlying fiscal trends. During the latter MEXICAN SWAP LINE ACTIVITY part of the period, Canadian financial markets During the period, the U.S. monetary authorities started to recover once market participants had substantially increased their swap lines with discounted the possibility of a Moody's down- Mexico, which had stood at $6 billion at the start of grade. Canadian markets also benefited toward the period. Temporary short-term swap lines were the end of the period as concerns about Quebec established on January 2, as the Federal Reserve separatism receded. agreed to a $1.5 billion facility with the Bank of Mexico and the ESF agreed to a facility of the same amount with the Mexican central bank and TREASURY AND FEDERAL RESERVE government. The Federal Reserve's temporary FOREIGN EXCHANGE RESERVES facility was later increased to $3 billion on February 1. The U.S. monetary authorities intervened twice dur- In addition, as part of the US. financial package ing the period, buying a total of $1.42 billion signed on February 21, the ESF established a against the Japanese yen and the German mark. On medium-term swap facility with the Mexican gov- both occasions, intervention operations were ernment. The facility allows Mexico to draw up to financed equally by the Federal Reserve and the $20 billion, less the amounts outstanding from Treasury Department's ESF. The Federal Reserve short-term swaps and securities guarantees. and the ESF realized total profits of $187.2 million The Mexican authorities drew on both short- and and $164.1 million respectively on their intervenmedium-term facilities during the period. On two tion operations. Realized profits and losses on sales separate occasions, January 11 and 13, Mexico of foreign currencies are computed as the differdrew $250 million from each of its regular short- ence between historic cost-of-acquisition exchange term facilities with the Federal Reserve and the rates and sale exchange rates. ESF. Then, for value on February 2, Mexico drew At the end of the period the current values of the $1 billion from each regular short-term facility. foreign exchange reserve holdings of the Federal Mexico drew $3 billion from the medium-term Reserve and the ESF were $25.3 billion and facility on March 14 and on the same date repaid in $25.4 billion respectively. The U.S. monetary full the January drawings. authorities regularly invest their foreign currency Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Treasury and Federal Reserve Foreign Exchange Operations 591 balances in a variety of instruments that yield Reserve and the ESF held, either directly or market-related rates of return and have a high under repurchase agreement, $9.7 billion and degree of liquidity and credit quality. A portion of $13.8 billion respectively in foreign government the balances is invested in foreign government- securities. • issued securities. As of March 31, the Federal Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

592 Industrial Production and Capacity Utilization for April 1995 Released for publication May 16 drop in the production of motor vehicles and parts. Manufacturing output fell 0.5 percent, while pro- Industrial production declined 0.4 percent in April duction advanced 0.2 percent at mines and 1.6 perafter a decrease of 0.3 percent in March. More than cent at utilities. At 121.1 percent of its 1987 averhalf of the April decline was due to a 4.4 percent age, industrial production in April was 3.8 percent Industrial production indexes Twelve-month percent change Twelve-month percent change Total industry Manufacturing H + 5 H 5 + 0 0 - 5 - 5 10 10 Materials 5 5 + Products 0 Nondurable manufacturing 5 1989 1990 1991 1992 1993 1994 1995 1989 1990 1991 1992 1993 1994 1995 Capacity and industrial production Ratio scale, 1987 production =100 Ratio scale, 1987 production = 100 — Total industry Capacity - - 140 — Manufacturing Capacity _ — 140 ^ - 120 120 ^ Production - 100 100 Production 80 80 1 1 1 1 1 1 1 1 1 1 1 Percent of capacity Percent of capacity Total industry Manufacturing Utilization 90 Utilization 90 80 80 70 70 J I L J I I I I I I L J I I L J I I I L 1981 1983 1985 1987 1989 1991 1993 1995 1981 1983 1985 1987 1989 1991 1993 1995 All series are seasonally adjusted. Latest series, April. Capacity is an index of potential industrial production. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

593 Industrial production and capacity utilization, April 1995 Industrial production, index, 1987=100 Percentage change Category 1995 1995' Apr. 1994 to Jan.r Feb.r Mar.' Apr.r Jan.r Feb. Mar.' Apr. i Apr. 1995 Total 122.0 122.0 121.6 121.1 -.3 3.8 Previous estimate 122.2 122.3 121.9 .4 .1 -.3 Major market groups Products, total2 119.1 119.0 118.6 118.0 .3 -.1 -.4 -.5 2.8 Consumer goods ... 115.7 115.7 114.7 114.1 .1 .0 -.9 -.5 1.6 Business equipment 153.7 154.1 154.7 154.1 .7 .3 .4 -.4 7.4 Construction supplies 112.2 111.3 111.4 109.7 .5 -.7 .0 -1.5 4.8 Materials 126.5 126.5 126.2 126.0 .2 .0 -.2 -.2 5.2 Major industry groups Manufacturing 124.5 124.2 124.0 123.3 .2 -.2 -.1 -.5 4.2 Durable 131.6 131.5 131.4 130.3 .3 -.1 -.1 -.8 5.3 Nondurable 116.5 116.1 115.8 115.6 .1 -.3 -.2 -.2 2.9 Mining 100.0 100.6 100.0 100.2 -.2 .7 -.6 .2 -.5 Utilities 116.5 118.3 115.5 117.3 1.1 1.6 -2.4 1.6 2.2 Capacity utilization, percent 1994 1995 Average, Low, High, 1967-94 1982 1988-89 Apr. Jan.r Feb.r Mar.r Apr.f Total 82.0 71.8 84.9 83.6 85.5 85.2 84.7 84.1 3.1 Previous estimate 85.6 85.4 84.9 Manufacturing 81.3 70.0 85.2 83.0 85.2 84.7 84.3 83.5 3.5 Advanced processing 80.7 71.4 83.5 81.3 83.2 82.8 82.4 81.6 3.9 Primary processing . 82.5 66.8 89.0 87.2 90.2 89.4 89.2 88.3 2.4 Mining 87.4 80.6 86.5 90.3 89.7 90.3 89.8 90.0 -.1 Utilities 86.7 76.2 92.6 85.1 85.6 86.8 84.7 85.9 1.3 NOTE. Data seasonally adjusted or calculated from seasonally adjusted 2. Contains components in addition to those shown, monthly data. r Revised, 1. Change from preceding month. p Preliminary. higher than it was twelve months earlier. Capacity and gas utilities and increases in the production of utilization declined 0.6 percentage point in April consumer chemical and paper products more than after falling 0.5 percentage point in March. At offset further decreases in the output of food and 84.1 percent, the rate of capacity utilization in clothing and a drop in the production of gasoline April was below the 85.5 percent high attained this and distillate fuel oil. past December and January and the 84.9 percent The production of business equipment fell high reached during the 1988-89 period. 0.4 percent, its first decrease in nearly three years. When analyzed by market group, the data show The decline was led by a large reduction in the that the overall output of consumer goods production of business autos, but output was also decreased 0.5 percent. The output of the durable significantly down for medium and heavy trucks, goods component declined 2.8 percent, however, farm equipment, service industry equipment, and largely because of a 9.1 percent drop in the produc- office furniture and fixtures. The production of tion of consumer autos and further sizable cutbacks information processing equipment, led by a 2.0 perin the production of household furniture and vari- cent increase in computers and office equipment, ous household appliances. The output of the non- advanced 0.7 percent. durable goods component edged up 0.1 percent; a The overall output of intermediate products rebound in residential sales of energy by electric declined 0.7 percent, with the production of con- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

594 Federal Reserve Bulletin • June 1995 struction supplies falling 1.5 percent and the output from their March pace, however. Within nonduof business supplies slipping 0.2 percent. rables manufacturing, significant declines in food, The production index for materials dipped apparel products, rubber and plastics products, and 0.2 percent, as a decline of 0.6 percent in the output leather were largely offset by growth in tobacco, of durable goods materials more than offset an paper and products, and printing and publishing. increase of 0.7 percent in the output of energy Reflecting the continuing weakness in output, materials. The production of nondurable goods the factory operating rate declined further in April, materials was unchanged. Declines in the produc- to 83.5 percent of capacity, compared with the tion of original equipment parts for motor vehicles most recent peaks of 85.2 percent in January 1995, and in the output of a variety of steel and other December 1994, and January 1989. The utilization metal products account for much of the decrease in rate in the primary-processing industries retreated the output of durable goods materials. Increases in 0.9 percentage point, to 88.3 percent; the most crude oil and natural gas production and in electric- recent peaks were 90.8 percent in December 1994 ity generation account for the growth in the output and 89.0 percent in January 1989. The utilization of energy materials. rate for advanced-processing industries fell back When analyzed by industry group, the data show 0.8 percentage point; at 81.6 percent, the April rate that factory output decreased 0.5 percent in April was 1.6 percentage points below its January 1995 after declines of 0.2 percent in February and peak and 1.9 percentage points below its Janu- 0.1 percent in March. In April, the output of ary 1989 peak. durables manufacturers dropped 0.8 percent, while The output of utilities, which had contracted that of nondurables manufacturers fell 0.2 percent. sharply in March, rebounded somewhat in April. Among durables manufacturers, output declined As a result, the operating rate at utilities rose from noticeably in all major industry groups except 84.7 percent in March to 85.9 percent. Operating three: industrial machinery and computer equip- rates at mines increased slightly, to 90 percent, ment, electrical machinery, and instruments. The largely because of gains in metal mining and in oil rates of growth in these three industries softened and gas well drilling. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

595 Announcements REVISIONS OF THE BOARD'S COMMUNITY institutions, wholesale and limited-purpose institu- REINVESTMENT ACT REGULATIONS tions, and institutions electing strategic plans), and reduces data collection and reporting requirements The Federal Reserve Board on April 24, 1995, for covered institutions. The final rule also reflects issued a completely revised Community Reinvest- comments received on the 1994 proposal, takes ment Act (CRA) regulation (Regulation BB) and into account the agencies' further internal considrelated conforming amendments to its Regulation erations, and makes other modifications and C (Home Mortgage Disclosure Act). Parallel regu- clarifications. lations are being issued by the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Office of Thrift Supervision for insti- ISSUANCE OF INTERPRETATION tutions they supervise. OF REGULATION H The revisions provide guidance to financial institutions on the assessment of their CRA-related The Federal Reserve Board on April 6, 1995, activities. The final procedures emphasize perfor- issued an interpretation of its Regulation H (Memmance rather than process, promote consistency in bership of State Banking Institutions in the Federal assessments, and reduce unnecessary compliance Reserve System) relating to the establishment of burden while encouraging improved performance. loan production offices and "back office" facilities Provisions of the final rule become effective on of state member banks. January 1, 1996, for small financial institutions and The interpretation provides that a "back office" institutions electing to be evaluated under a strate- facility established by a state member bank is not gic plan. In addition, wholesale and limited- considered a branch of the bank. Also, the interprepurpose institutions that have collected community tation states that loans originated by a loan producdevelopment lending data may elect to be evalu- tion office of a bank may be approved at a back ated under a separate test after January 1. Large office location—and not considered a branch—if retail financial institutions will be subject to the the proceeds of the loan are received by the cusfinal rule after July 1, 1997, unless they have tomer at a location other than a loan production elected to be evaluated under the new provisions office or a back office facility. and have collected the required data before that This interpretation provides parity between state date. member banks and national banks in this respect. Data collection requirements become effective January 1, 1996, and data reporting requirements become effective January 1, 1997. ADOPTION OF REGULATORY "SAFE HARBOR" Revisions to the CRA regulation were proposed IN RELATION TO ANTI-TYING RESTRICTIONS for public comment on December 21, 1993, and IN REGULATION Y October 7, 1994. Compared with the 1994 proposal, the final rule deletes the collection of data on The Federal Reserve Board announced on April 20, race and gender for small business and small farm 1995, the adoption of a regulatory "safe harbor" loan customers, raises the holding company asset from the anti-tying restrictions of section 106 of threshold from $250 million to $1 billion for insti- the Bank Holding Company Act Amendments of tutions to qualify as small financial institutions, 1970 and the Board's Regulation Y (Bank Holding retains separate evaluation standards for different Companies and Change in Bank Control). The types of institutions (large retail and small financial regulation became effective May 26, 1995. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

596 Federal Reserve Bulletin • June 1995 The safe harbor permits any bank or nonbank • One hundred twenty-three stocks have been subsidiary of a bank holding company to offer a included for the first time, 102 under National "combined-balance discount"—that is, a discount Market System (NMS) designation based on a customer maintaining a combined mini- • Forty-two stocks previously on the list have mum balance in products specified by the company been removed for substantially failing to meet the offering the discount. requirements for continued listing • Seventy-six stocks have been removed for reasons such as listing on a national securities PROPOSED ACTIONS exchange or involvement in an acquisition. The Federal Reserve Board on April 14, 1995, The OTC list is composed of OTC stocks that requested comment on a proposed amendment to have been determined by the Board to be subject to Regulation O (Loans to Executive Officers, Direc- margin requirements in Regulations G (Securities tors, and Principal Shareholders of Member Banks) Credit by Persons other than Banks, Brokers, or to conform the definition of unimpaired capital and Dealers), T, and U (Credit by Banks for Purchasing unimpaired surplus in the regulation's definition of or Carrying Margin Stocks). It includes OTC stocks lending limit to the definition of capital and surplus qualifying under Board criteria and also includes recently adopted by the Office of the Comptroller all OTC stocks designated as NMS securities. of the Currency in calculating the limit on loans by Additional NMS securities may be added in the a national bank to a single borrower. Comment is interim between quarterly Board publications; these requested by May 22, 1995. securities are immediately marginable upon desig- The Board also issued for public comment on nation as NMS securities. April 21, 1995, a proposal to permit, but not The foreign list specifies those foreign equity require, banks and other creditors to request infor- securities that are eligible for margin treatment at mation on the race, color, sex, religion, and broker-dealers. There are fifteen additions to and national origin of applicants for credit. The pro- one deletion from the foreign list; it now contains posal would amend the Board's Regulation B 701 foreign equity securities. (Equal Credit Opportunity). Comments should be received by the Board by June 27. ISSUANCE OF REPORT ON THE PROCESSING OF APPLICATIONS DURING 1994 PUBLICATION OF THE REVISED LIST OF OTC The Federal Reserve Board issued on April 17, STOCKS SUBJECT TO MARGIN REGULATIONS 1995, a report on its processing of applications AND OF THE REVISED FOREIGN LIST during 1994. In 1994 the System acted on 3,574 applications and notices filed by bank holding com- The Federal Reserve Board on April 24, 1995, panies and state-chartered member banks. The total published a revised list of over-the-counter (OTC) number of applications for 1994 increased 28 perstocks that are subject to its margin regulations cent compared with the number for 1993, with (OTC list). Also published was a revised list of notices to establish branches accounting for almost foreign equity securities (foreign list) that meet the two-thirds of the increase. margin criteria in Regulation T (Credit by Brokers A breakdown of applications processed showed and Dealers). These lists are published for the the following percentages: information of lenders and the general public. The lists became effective May 8, 1995, and • To expand banking operations (other than supersede the previous lists that were effective branching), almost 15 percent February 13, 1995. The next revision of the lists is • For nonbanking expansion, almost 22 percent scheduled to be effective August 1995. • Bank branch notices, about 36 percent The changes that were made to the revised OTC • Bank holding company formations and change list, which now contains 4,081 OTC stocks, are as of control notices for state member banks and bank follows: holding companies, 13 percent Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 597 • International activities of U.S. banking organi- National Survey of Small Business Finances. The zations, about 3 percent survey, based on a nationally representative sample • Various other applications, such as those from of about 3,200 small businesses, covers the firms' banks to become members of the Federal Reserve use of financial services and institutions, plus their System or to invest in bank premises or bank assets and liabilities, ownership, and other financial holding companies seeking relief from commit- and demographic characteristics. ments or to redeem stock, 12 percent. A unique feature of the survey is that it identifies specific financial services the firms obtained from The Federal Reserve maintains target dates and each of the financial institutions they used; these procedures for the processing of applications filed data permit investigation of "clustering," or bununder the Bank Holding Company Act, the Bank dling, of financial services. Such investigations Merger Act, and the Change in Bank Control Act. using the 1987 survey have been published in the The time allowed for a decision is sixty days after Federal Reserve Bulletin (October 1990, pp. 801acceptance of an application. In 1994, action was 17) and in the Board's Staff Studies 160 (Septemtaken on 94 percent of all applications within the ber 1990), which also contain additional informaestablished time frame. Delays in completing back- tion on methods for the survey. A preliminary ground checks and extra time required to investi- examination of some data from the 1993 survey is gate questions raised about compliance and perfor- scheduled for the July 1995 Bulletin. The 200-page mance with regard to relevant laws and regulations publication can be purchased, for $5, from Publicaaccounted for a majority of the applications that tions Services, Mail Stop 127, Board of Governors were not processed within the target time frame. of the Federal Reserve System, Washington, DC On average, the 3,574 applications and notices 20551. were processed in 33 calendar days from the date of acceptance and 58 days from the date of filing, an improvement over the results for 1993: 41 days ANNUAL REPORT: PUBLICATION and 66 days respectively. The average total processing time for international applications im- The 81st Annual Report, 1994, of the Board of proved from 186 days in 1993 to 149 days in 1994, Governors of the Federal Reserve System, coverand the average total processing time for domestic ing operations for the calendar year 1994, is availapplications improved from 63 days in 1993 to able for distribution. Copies may be obtained on 55 days in 1994. request to Publications Services, Mail Stop 127, Board of Governors of the Federal Reserve System, Washington, DC 20551. A separately printed PUBLICATION OF NEW REPORT: companion document, entitled Annual Report: Budget Review, 1994-95, describes the budgeted DESCRIPTIVE STATISTICS FROM THE 1987 expenses of the Federal Reserve System for 1995 NATIONAL SURVEY OF SMALL BUSINESS and compares them with expenses for 1993 and FINANCES 1994; it is also available from Publications A new Federal Reserve Board publication provides Services. • general descriptive statistics from the 1987 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

598 Legal Developments FINAL RULE—AMENDMENT TO REGULATION Y (ii) Balances in deposits count at least as much as non-deposit products toward the minimum balance. The Board of Governors is amending 12 C.F.R. Part 225, its Regulation Y (Bank Holding Companies and Change in Bank Control). The Board is adopting a regulatory ORDERS ISSUED UNDER BANK HOLDING COMPANY "safe harbor" from the anti-tying restrictions of section ACT 106 of the Bank Holding Company Act Amendments of 1970 and the Board's Regulation Y. The safe harbor Orders Issued Under Section 3 of the Bank permits any bank or nonbank subsidiary of a bank hold- Holding Company Act ing company to offer a "combined-balance discount"— that is, a discount based on a customer maintaining a Corporacion Bancaria de Espana combined minimum balance in products specified by the Madrid, Spain company offering the discount. Effective May 26, 1995, 12 C.F.R. Part 225 is Order Approving the Formation of a Bank Holding amended as follows: Company Part 225—Bank Holding Companies and Change Corporacion Bancaria de Espana, Madrid, Spain in Bank Control (Regulation Y) ("CBE"), has applied under section 3(a)(1) of the Bank Holding Company Act ("BHC Act") (12U.S.C. § 1842(a)(1)) to become a bank holding company within 1. The authority citation for 12 C.F.R. Part 225 continues the meaning of the BHC Act by retaining 73.2 percent of to read as follows: the voting shares of Banco Exterior de Espana, Madrid, Spain ("BEX"), a foreign bank registered as a bank Authority: 12U.S.C. 1817(j)(13), 1818, 1831i, 1831p-l, holding company through its ownership of all the voting 1843(c)(8), 1844(b), 1972(1), 3106, 3108, 3310, 3331- shares of Extebank, Stony Brook, New York. 3351, 3907, and 3909. Notice of the application, affording interested persons an opportunity to submit comments, has been published 2. In section 225.7, a new paragraph (b)(4) is added to (57 Federal Register 46,971 (1993)). The time for filing read as follows: comments has expired, and the Board has considered the application and all comments received in light of the factors set forth in section 3(c) of the BHC Act. Section 225.7—Tying restrictions. CBE, with approximately $88.6 billion in total consolidated assets,1 is the third largest commercial banking organization in Spain. CBE was created by the Spanish government as a "governmental company" with bank status to serve as a holding company for BEX and (b) * * * several other financial institutions controlled by the gov- (4) Safe harbor for combined-balance discounts. A ernment. The Spanish government currently owns bank holding company or any bank or nonbank sub- 50.9 percent of the voting shares of CBE. Extebank is sidiary thereof may vary the consideration for any the 38th largest commercial banking organization in product or package of products based on a customer's New York, controlling deposits of approximately $409.8 maintaining a combined minimum balance in certain million, representing less than one percent of all deposits products specified by the company varying the consid- in commercial banks in the state.2 BEX, which also eration (eligible products), if: (i) That company (if it is a bank) or a bank affiliate of that company (if it is not a bank) offers deposits, 1. Asset data are as of December 31, 1994. and all such deposits are eligible products; and 2. Deposit data are as of December 31, 1994. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 599 operates an agency in Miami and a representative office The financial and managerial resources and future in New York, is the only subsidiary of CBE that engages prospects of CBE, BEX, and Extebank are consisin commercial banking activities in the United States. tentwith approval. Considerations relating to the effects Under section 3 of the BHC Act, as amended by the of this proposal on competition and the convenience and Foreign Bank Supervision Enhancement Act of 1991,3 needs of the communities to be served are also consisthe Board may not approve an application involving a tent with approval. foreign bank unless the bank is "subject to comprehen- Based on the foregoing and other facts of record, and sive supervision or regulation on a consolidated basis by subject to the commitments made by CBE and BEX in the appropriate authorities in the bank's home country."4 this case, the Board has determined that the application The Board has previously determined, in applications should be, and hereby is, approved. This approval is under the International Banking Act (12 U.S.C. § 3101 specifically conditioned on compliance by CBE and et seq.) ("IBA"), that other Spanish credit institutions BEX with all the commitments made in connection with are subject to comprehensive consolidated supervision this application and with the conditions contained in this by their home country supervisor, the Bank of Spain.5 order. For purposes of this action, all of these commit- CBE and BEX have provided information demonstrating ments and conditions are considered conditions imposed that they are subject to the same regulatory scheme in writing and, as such, may be enforced in proceedings applicable to these other institutions. In addition, the under applicable law. Bank of Spain has stated that, in performing its supervi- By order of the Board of Governors, effective sory functions, it makes no distinction between private April 5, 1995. and government-owned banks. Based on all the facts of record, including the information described above, the Voting for this action: Chairman Greenspan, and Governors Board has concluded that CBE and BEX are subject to LaWare, Lindsey, Phillips, and Yellen. Absent and not voting: comprehensive supervision and regulation on a consoli- Vice Chairman Blinder and Governor Kelley. dated basis by their home country supervisor. JENNIFER J. JOHNSON In addition, CBE and BEX have committed that they Deputy Secretary of the Board will make available to the Board such information on the operations of CBE and BEX and any of their affiliates Huntington Bancshares Incorporated that the Board deems necessary to determine and enforce Columbus, Ohio compliance with the BHC Act, the IBA, and other applicable federal law. To the extent that the provisions of Huntington Bancshares Florida, Inc. such information to the Board may be prohibited or Columbus, Ohio impeded by law, CBE and BEX have committed to cooperate with the Board to obtain any waivers or ex- Order Approving Acquisition of a Bank Holding emptions that may be necessary in order to enable CBE Company and BEX to make any such information available to the Board. In light of these commitments and other facts of record,6 the Board has concluded that CBE and BEX Huntington Bancshares Incorporated ("Huntington") and its wholly owned subsidiary, Huntington Bancshares have provided adequate assurances of access to any Florida, Inc. ("Huntington Florida"), Columbus, Ohio, appropriate information the Board may request. bank holding companies within the meaning of the Bank Holding Company Act ("BHC Act"), have applied under section 3 of the BHC Act (12 U.S.C. § 1842) to merge with Security National Corporation ("Security") 3. Pub. L. No. 102-242, § 201 et seq., 105 Stat. 2286 (1991). and thereby indirectly acquire its wholly owned subsid- 4. 12 U.S.C. § 1842(c)(3)(B). As provided in Regulation Y, the Board iary, Security National Bank ("Security Bank"), Maitdetermines whether a foreign bank is subject to consolidated home land, Florida.1 country supervision under the standards set forth in Regulation K. 12 C.F.R. 225.13(b)(5). Regulation K provides that a foreign bank may Notice of these applications, affording interested perbe considered subject to consolidated supervision if the Board deter- sons an opportunity to submit comments, has been pubmines that the bank is supervised or regulated in such a manner that its home country supervisor receives sufficient information on the worldwide operations of the foreign bank, including the relationship of the bank to its affiliates, to assess the foreign bank's overall financial 1. Upon the acquisition of Security and receipt of approval by the condition and compliance with law and regulation. 12 C.F.R. Office of the Comptroller of the Currency ("OCC"), Huntington's 211.24(c)(l)(ii). existing subsidiary Huntington Federal Savings Bank, Sebring, Florida, 5. See Banco de Sabadell, S.A., 79 Federal Reserve Bulletin 366 would be merged with and into Security Bank. Huntington also has (1993); Banco Santander, S.A., 79 Federal Reserve Bulletin 622 (1993). requested Board approval under section 3 of the BHC Act to acquire an 6. The Board notes that it previously has reviewed relevant provisions option to purchase up to 24.9 percent of the voting shares of Security, of Spanish confidentiality, secrecy, and other laws. See Banco de which would become moot upon consummation of Huntington's appli- Sabadell, S.A., 79 Federal Reserve Bulletin 366 (1993). cation to merge with Security. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

600 Federal Reserve Bulletin • June 1995 lished (60 Federal Register 2751 (1995)). The time for that its approval of this proposal is not prohibited by the filing comments has expired, and the Board has consid- Douglas Amendment. ered the applications and all comments received in light of the factors set forth in section 3(c) of the BHC Act. Convenience and Needs Considerations Huntington, with total consolidated assets of $17 billion, controls ten depository institutions in eight states.2 In considering an application to acquire a depository Huntington, which controls three depository institutions institution under the BHC Act, the Board must consider in Florida, is the 53d largest depository organization in the convenience and needs of the communities to be the state, controlling $225.2 million in deposits, repre- served, and take into account the records of the relevant senting less than 1 percent of the total deposits in depos- depository institutions under the Community Reinvestitory institutions in the state. Security is the 76th largest ment Act (12 U.S.C. § 2901 et seq.) ("CRA"). The depository organization in Florida, controlling Board notes that, with one exception,6 all of Hunting- $166.3 million in deposits, also representing less than ton's subsidiary banks and savings associations that have 1 percent of the total deposits in depository institutions been examined for CRA performance received an "outin the state. Upon consummation of this proposal, Hun- standing" or "satisfactory" rating from their primary tington would become the 41st largest depository organi- regulator in their most recent examinations for CRA zation in Florida, controlling deposits of $391.4 million, performance.7 Based on these and all other facts of representing less than 1 percent of the total deposits in record, the Board concludes that considerations relating depository institutions in the state. to the record of performance under the CRA are consis- Huntington and Security do not compete directly in tent with approval of these applications. any banking market. Therefore, consummation of this proposal would not have a significantly adverse effect on Other Considerations competition or the concentration of banking resources in any relevant banking market. The Board also concludes that the financial and managerial resources and future prospects of Huntington, Secu- Douglas Amendment Analysis rity, and their respective subsidiary banks, and the other supervisory factors that the Board must consider under Section 3(d) of the BHC Act, the Douglas Amendment, section 3 of the BHC Act, are consistent with approval prohibits the Board from approving an application by a of this proposal. bank holding company to acquire control of any bank Based on the foregoing and all other facts of record, located outside the bank holding company's home state the Board has determined that these applications should unless the acquisition is "specifically authorized by the be, and hereby are, approved. The Board's approval is statute laws of the state in which such bank is located, by expressly conditioned on Huntington's compliance with language to that effect and not merely by implication."3 all the commitments made in connection with these For purposes of the Douglas Amendment, Huntington's applications. The commitments and conditions relied on home state is Ohio, and the home state of Security and Security Bank is Florida.4 6. First Trust Savings Bank, F.S.B., Jacksonville, Florida ("First Ohio and Florida banking statutes permit out-of-state Trust"), received a "needs to improve" rating in its October 1994 CRA bank holding companies to acquire banks in their respec- examination by the Office of Thrift Supervision ("OTS"). First Trust, tive states, provided that the home state of the acquiring with assets totalling $25 million, comprises less than 1 percent of Huntington's total assets and is one of two thrift subsidiaries acquired bank holding company permits the acquisition of banks by Huntington in conjunction with its May 1993 acquisition of Charter in that state on a reciprocal basis.5 The Florida State Oak Financial Corporation, Cincinnati, Ohio. Since this acquisition, Comptroller concluded that Huntington's proposal is Huntington has sought to divest First Trust and on March 31, 1995, the OTS approved a sale of First Trust. The Board notes that Huntington authorized under Florida law and approved the transac- has taken numerous steps to improve the CRA performance record of tion. In light of the foregoing and based on an analysis of First Trust during the brief period that it has controlled First Trust. In the banking statutes involved, the Board has determined particular, Huntington analyzed First Trust's HMDA data and performed a geoanalysis of its loans for CRA purposes and expanded its marketing efforts in publications owned by African Americans. In addition, First Trust has provided over $400,000 to the City of Jackson- 2. Asset and state deposit data are as of June 30, 1994. ville's housing assistance programs. 3. 12 U.S.C. § 1842(d). A bank holding company's home state is that 7. In its most recent examination for CRA performance, Huntington's state in which the operations of the bank holding company's banking lead bank, The Huntington National Bank, Columbus, Ohio ("Ohio subsidiaries were principally conducted on July 1, 1966, or the date on Bank"), received a "satisfactory" rating from its primary regulator, the which the company became a bank holding company, whichever is OCC. The examination identified certain areas of concern that Ohio later. Bank agreed to address, and the Board notes that Huntington and Ohio 4. Upon the acquisition of Security, Huntington Florida's home state Bank have implemented corrective actions to address these areas of would be Florida. concern. The Board will continue to monitor Huntington's progress in 5. FLA. STAT. § 658.295(3) (eff. May 1, 1995); OHIO REV. CODE correcting these areas in future applications to acquire depository facili- ANN. § 1101.05 (1985). ties. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 601 by the Board in reaching this decision shall be deemed to representing less than 1 percent of total deposits in be conditions imposed in writing by the Board in con- commercial banking organizations in the state. nection with its findings and decision, and, as such, may Westamerica and Bank compete in the Sacramento be enforced in proceedings under applicable law. RMA banking market.3 Upon consummation of this The acquisition of Security shall not be consummated proposal, the market would remain moderately concenbefore the fifteenth calendar day following the effective trated, as measured by the Herfindahl-Hirschman Index date of this order, or later than three months after the ("HHI"), and this proposal would not exceed the Deeffective date of this order, unless such period is ex- partment of Justice merger guidelines.4 In addition, nutended for good cause by the Board or by the Federal merous competitors would remain in the market. After Reserve Bank of Cleveland, acting pursuant to delegated considering the competition offered by the commercial authority. banking institutions that would remain in the market, the By order of the Board of Governors, effective relatively small increase in concentration as measured by April 12, 1995. the HHI, and all other facts of record, the Board concludes that consummation of this proposal is not likely to result in significantly adverse effects on competition Voting for this action: Governors LaWare, Lindsey, Phillips, and Yellen. Absent and not voting: Chairman Greenspan, Vice Chair- or the concentration of banking resources in the Sacraman Blinder, and Governor Kelley. mento RMA banking market or any other relevant banking market. JENNIFER J. JOHNSON Deputy Secretary of the Board Convenience and Needs Considerations Westamerica Bancorporation In acting on an application to acquire a depository insti- San Rafael, California tution, the Board must consider the convenience and needs of the communities to be served and take into Order Approving Acquisition of a Bank account the records of the relevant depository institutions under the Community Reinvestment Act Westamerica Bancorporation, San Rafael, California (12 U.S.C. § 2901 et seq.) ("CRA"). The CRA requires ("Westamerica"), a bank holding company within the the federal financial supervisory agencies to encourage meaning of the Bank Holding Company Act ("BHC financial institutions to help meet the credit needs of the Act"), has applied under section 3 of the BHC Act local communities in which they operate, consistent with (12 U.S.C. § 1842) to acquire all the voting shares of the safe and sound operation of such institutions. To CapitolBank Sacramento, Sacramento, California accomplish this end, the CRA requires the appropriate ("Bank").1 federal supervisory authority to "assess the institution's Notice of the application, affording interested persons record of meeting the credit needs of its entire commuan opportunity to submit comments, has been published nity, including low- and moderate-income neighbor- (60 Federal Register 4628 (1995)). The time for filing hoods, consistent with the safe and sound operation of comments has expired, and the Board has considered the application and all comments received in light of the factors set forth in section 3(c) of the BHC Act. Westamerica is the 11th largest commercial banking organization in California, controlling deposits of approximately $1.7 billion, representing less than 1 percent 3. All market data are as of June 30, 1993. Market share data are based on calculations in which the deposits of thrift institutions are of total deposits in commercial banks in the state.2 Bank included at 50 percent. The Board previously has indicated that thrift is the 123d largest commercial banking organization in institutions have become, or have the potential to become, significant competitors of commercial banks. See WM Bancorp, 76 Federal Re- California, controlling deposits of approximately serve Bulletin 788 (1990); National City Corporation, 70 Federal $127.9 million, representing less than 1 percent of total Reserve Bulletin 743 (1984). deposits in commercial banks in the state. Upon consum- 4. Under the revised Department of Justice Merger Guidelines, 49 Federal Register 26,823 (June 29, 1984), a market in which the postmation of this proposal, Westamerica would remain the merger HHI is between 1000 and 1800 is considered moderately con- 11th largest commercial banking organization in Califor- centrated. The Justice Department has informed the Board that a bank merger or acquisition generally will not be challenged (in the absence of nia, controlling approximately $1.8 billion in deposits, other factors indicating anticompetitive effects) unless the post-merger HHI is at least 1800 and the merger increases the HHI by more than 200 points. The Justice Department has stated that the higher than normal 1. Westamerica also has applied to obtain and exercise an option to HHI thresholds for screening bank mergers for anticompetitive effects acquire 9.9 percent of Bank's common stock if a competing offer is implicitly recognize the competitive effect of limited-purpose lenders made for Bank. The option would terminate upon consummation of this and other non-depository financial entities. The HHI for the Sacramento proposal. RMA banking market would increase from 1371 to 1372 as a result of this transaction. 2. State banking data are as of December 31,1994. 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602 Federal Reserve Bulletin • June 1995 such institutions," and to take that record into account in neighborhoods and small businesses. These programs its evaluation of these applications.5 include extensions of credit for rehabilitation of commer- Comments on the application were submitted by an cial buildings and the construction of low-income housindividual ("Protestant") criticizing the record of Bank ing units, as well as loans to charitable organizations to under the CRA and alleging that Bank has not fully help them meet their operating expenses. complied with CRA because Bank's reports filed pursu- After consummation of this proposal, Westamerica ant to the Home Mortgage Disclosure Act ("HMDA") plans to merge Bank into Westam Bank and to expand disclosed that Bank had not made any residential mort- Bank's CRA efforts through participation in Westam gage loans to minorities or women. The Board has Bank's Community Access Loan Program ("CAL Procarefully reviewed the entire CRA performance record gram"). The CAL Program includes home equity loans, of Westamerica's subsidiary banks and Bank, all com- automobile loans and home improvement loans with ments received on this application, Westamerica's re- lower-than-usual monthly payment terms and flexible sponse to these comments, and all other relevant facts of qualifications. These products are designed to meet the record, in light of the CRA, the Board's regulations, and credit needs of consumers who do not qualify for stanthe Statement of the Federal Financial Supervisory dard loans because of their income level. Westam Bank's Agencies Regarding the Community Reinvestment Act CAL-PAL program provides real estate mortgages with ("Agency CRA Statement").6 flexible eligibility standards and lower down payment requirements. As of October 1994, Westam Bank had A. Record of CRA Performance extended approximately $2.2 million CAL-PAL loans. Westam Bank also has participated in a "silent second" program with local governments, which provides subsi- The Agency CRA Statement provides that a CRA examdized down payments for low-income borrowers. As of ination is an important and often controlling factor in the October 1994, Westam Bank had participated in six consideration of an institution's CRA record and that "silent second" transactions totalling more than reports of these examinations will be given great weight in the applications process.7 The Board notes that West- $823,000. Westam Bank also has instituted the "CAL Business" loan program, which offers business loans to america's lead bank, Westamerica Bank, San Rafael, women and minorities in cooperation with local agencies California ("Westam Bank"), received a "satisfactory" that provide technical support to start-up businesses. rating in its most recent examination for CRA perfor- Under the CAL Business program, a borrower can bormance from the Federal Reserve Bank of San Francisco row as little as $500 without payment of loan origination ("Federal Reserve Bank") in October 1994, and that fees. As of October 1994, 31 loans totalling $395,000 Bank also received a "satisfactory" rating at its most had been made under the CAL Business program. Westrecent examination for CRA performance from the Fedam Bank currently is a participant in several Small eral Deposit Insurance Corporation ("FDIC"). West- Business Administration loan programs. As of June america's other subsidiary banks also received "satisfac- 1994, Westam Bank had 81 SBA guaranteed loans outtory" ratings in their most recent examination for CRA standing totalling $16.6 million.8 performance from the FDIC. B. Lending Activities C. Conclusion The record indicates that Bank's primary focus is on The Board has carefully considered all the facts of serving the credit needs of small- and medium-sized record, including Protestant's comments, in reviewing businesses, and that Bank makes residential mortgage the CRA records of performance of Bank and of Westloans only as an accommodation to its business custom- america's subsidiary banks. Based on a review of the ers. Data provided by Bank demonstrate that Bank has entire record, including relevant reports of examination, made loans to women, minorities, and borrowers in low- the Board concludes that convenience and needs considand moderate-income areas. For example, Bank has orig- erations, including the banks' CRA records, are consisinated approximately 65 loans, totalling $18 million to tent with approval of this application. borrowers or projects located in low- to moderateincome areas, representing 20 percent of Bank's outstanding loan portfolio. In addition, Bank has participated in programs that benefit low- and moderate-income 8. The Federal Reserve Bank, in its most recent CRA examination of Westam Bank, found no evidence of prohibited discriminatory credit 5. 12 U.S.C. § 2903. practices, and the bank has taken additional steps to increase lending to 6. 54 Federal Register 13,742 (1989). low- and moderate-income areas, such as improved marketing and a 7. Id. at 13,745. review of its lending programs. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 603 Other Considerations Third Bank of Northeastern Ohio, Cleveland, Ohio ("Fifth Third Bank"), a wholly owned subsidiary of The financial and managerial resources and future pros- Bancorp, has also applied under section 18(c) of the pects of Westamerica, its subsidiary banks, and Bank, Federal Deposit Insurance Act (12 U.S.C. § 1828(c)) and the other supervisory factors that the Board must ("Bank Merger Act") and section 5(d)(3) of the Federal consider under section 3 of the BHC Act, are consistent Deposit Insurance Act (12 U.S.C. § 1815(d)(3)), as with approval of this proposal. amended by the Federal Deposit Insurance Corporation Based on the foregoing and all the facts of record, the Improvement Act of 1991 (Pub. L. No. 102-242, § 501, Board has determined that the application should be, and 105 Stat. 2236, 2388-2392 (1991)), to acquire certain hereby is, approved. The Board's approval is expressly assets and assume certain liabilities of Savings Bank;1 conditioned on Westamerica's compliance with all the and incident thereto, to establish branch offices purcommitments made in connection with this application. suant to section 9 of the Federal Reserve Act The commitments and conditions relied on by the Board (12 U.S.C. § 321).2 in reaching this decision shall be deemed to be condi- Notice of this proposal, affording interested persons an tions imposed in writing by the Board in connection with opportunity to submit comments, has been published its findings and decision, and, as such, may be enforced (60 Federal Register 10,084 (1995)). As required by the in proceedings under applicable law. Bank Merger Act, reports on the competitive effects of The acquisition shall not be consummated before the the merger were requested from the United States Attorfifteenth calendar day following the effective date of this ney General, the Office of Thrift Supervision, and the order, or later than three months after the effective date Federal Deposit Insurance Corporation. The time for of this order, unless such period is extended for good filing comments has expired, and the Board has considcause by the Board or by the Federal Reserve Bank of ered the applications and all of the facts of record in light San Francisco, acting pursuant to delegated authority. of the factors set forth in the BHC Act, the Bank Merger By order of the Board of Governors, effective Act, and the Federal Reserve Act. April 17, 1995. The Board has determined that the operation of a savings association by a bank holding company is Voting for this action: Chairman Greenspan, Vice Chairman closely related to banking for purposes of section 4(c)(8) Blinder, and Governors Kelley, LaWare, Lindsey, Phillips, and of the BHC Act. 12 C.F.R. 225.25(b)(9). The Board Yellen. requires savings associations acquired by bank holding companies to conform their direct and indirect activities JENNIFER J. JOHNSON to those permissible for bank holding companies under Deputy Secretary of the Board section 4 of the BHC Act and Regulation Y. Bancorp has committed to conform all activities of Savings Bank to Orders Issued Under Section 4 of the Bank the requirements of section 4 of the BHC Act and Holding Company Act Regulation Y.3 In considering a notice under section 4(c)(8) of the Fifth Third Bancorp BHC Act, the Board is required to determine that the Cincinnati, Ohio applicant's ownership and operation of the acquired Fifth Third Bank of Northeastern Ohio Cleveland, Ohio 1. Because Fifth Third Bank, a state member bank, is a member of the Bank Insurance Fund and is acquiring deposits of Savings Bank, a Order Approving the Acquisition and Merger of a member of the Savings Association Insurance Fund, prior Board approval is required for this proposal under section 5(d)(3) of the Federal Savings Association and the Establishment of Branches Deposit Insurance Act. Section 5(d)(3) requires the Board to follow the procedures and consider the factors set forth in the Bank Merger Act. 2. The locations of the branches that Fifth Third Bank proposes to Fifth Third Bancorp, Cincinnati, Ohio ("Bancorp"), a establish are listed in the Appendix. bank holding company within the meaning of the Bank 3. Savings Bank engages in real estate activities that are not permissi- Holding Company Act ("BHC Act"), has filed notice ble for bank holding companies under the BHC Act. Bancorp has committed that all impermissible real estate activities will be divested under section 4(c)(8) of the BHC Act or terminated within two years of consummation of the proposal, that (12 U.S.C. § 1843(c)(8)) and section 225.23 of the no new impermissible projects or investments will be undertaken during Board's Regulation Y (12 C.F.R. 225.23) of its intention this period, and that capital adequacy guidelines will be met, excluding specified real estate investments. Bancorp also has committed that any to acquire Falls Financial Inc., Cuyahoga Falls, Ohio impermissible securities and insurance activities conducted by Savings ("Falls Financial"), and thereby indirectly acquire its Bank or its subsidiaries will cease on or before consummation of this proposal. Savings Bank may continue to service any impermissible wholly owned subsidiary, Falls Savings Bank, F.S.B., insurance policies for two years after the consummation of this pro- Cuyahoga Falls, Ohio ("Savings Bank"). The Fifth posal, but may not renew policies. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

604 Federal Reserve Bulletin • June 1995 company "can reasonably be expected to produce bene- Financial, and their respective subsidiaries, are consisfits to the public, such as greater convenience, increased tent with approval, as are the other supervisory factors competition, or gains in efficiency, that outweigh possi- the Board must consider under the Bank Merger Act and ble adverse effects, such as undue concentration of re- the Federal Reserve Act. In addition, the record does not sources, decreased or unfair competition, conflicts of indicate that consummation of this proposal is likely to interests, or unsound banking practices."4 result in any significantly adverse effects, such as undue Bancorp, with consolidated assets of $15 billion, con- concentration of resources, decreased or unfair competitrols 12 depository institutions in Ohio, Kentucky, Indi- tion, conflicts of interest, or unsound banking practices, ana, and Florida.5 Bancorp is the fourth largest deposi- that are not likely to be outweighed by the public benetory institution in Ohio, controlling total deposits of fits of this proposal. Accordingly, the Board has deter- $11.5 billion, representing approximately 6.5 percent of mined that the balance of public interest factors it must total deposits in depository institutions in the state.6 Falls consider under section 4(c)(8) of the BHC Act is favor- Financial is the 27th largest depository institution in able and consistent with approval of this notice. Ohio, controlling deposits of $555.6 million, represent- Moreover, the Board also has considered the specific ing less than 1 percent of total deposits in depository factors it must review under section 5(d)(3) of the Fedinstitutions in the state. Upon consummation of this eral Deposit Insurance Act, and the record in this case proposal, Bancorp would remain the fourth largest de- shows that: pository institution in Ohio, controlling deposits of (1) The transaction will not result in the transfer of $12 billion, representing approximately 6.8 percent of any federally insured depository institution's federal total deposits in depository institutions in the state. deposit insurance from one federal deposit insurance Bancorp and Falls Financial do not compete directly fund to the other; in any banking market. Accordingly, consummation of (2) Bancorp and Fifth Third Bank currently meet, and this proposal would not have a significantly adverse upon consummation of the proposed transaction will effect on competition or the concentration of banking continue to meet, all applicable capital standards; and resources in any relevant banking market. (3) The proposed transaction would comply with the interstate banking provision of the Bank Holding Convenience and Needs Considerations Company Act (12 U.S.C. § 1842(d)) if Savings Bank were a state bank that Bancorp was applying to ac- In acting on the notice and applications under the relequire directly. See 12 U.S.C. § 1815(d)(3). vant banking statutes, the Board must consider the convenience and needs of the communities to be served and Based on the foregoing and all the facts of record, the take into account the records of the relevant depository Board has determined that the applications and notice institutions under the Community Reinvestment Act should be, and hereby are, approved. The Board's ap- (12 U.S.C. § 2901 et seq.) ("CRA"). The Board notes proval is specifically conditioned on compliance by Fifth that all of Bancorp's subsidiary banks and savings banks Third Bank and Bancorp with the commitments made in that have been examined for CRA performance received connection with the applications and notice. The Board's an "outstanding" or "satisfactory" rating from their determination also is subject to all the conditions set primary supervisor in their most recent CRA perfor- forth in Regulation Y, including those in sections 225.7 mance examinations. In addition, Savings Bank received and 225.23(b) of Regulation Y, and to the Board's aua "satisfactory" rating in its most recent CRA perfor- thority to require such modification or termination of the mance examination by the Office of Thrift Supervision activities of a bank holding company or any of its as of June 1994. Based on these and all other facts of subsidiaries as the Board finds necessary to ensure comrecord, the Board concludes that considerations relating pliance with, and to prevent evasion of, the provisions of to the record of CRA performance are consistent with the BHC Act and the Board's regulations and orders approval of this proposal. issued thereunder. Approval of the proposal is further subject to Bancorp's obtaining any approvals required Other Considerations under applicable federal or state laws. For purposes of this action, the commitments and conditions relied on in The Board also concludes that the financial and managereaching this decision are both conditions imposed in rial resources and future prospects of Bancorp, Falls writing by the Board and, as such, may be enforced in proceedings under applicable law. 4. 12 U.S.C. § 1843(c)(8). The acquisition of Falls Financial and the merger of 5. Asset data are as of December 31, 1994. Fifth Third Bank and Savings Bank may not be consum- 6. Deposit data are as of June 30, 1994. In this context, depository mated before the fifteenth calendar day after the effective institutions include commercial banks, savings banks, and savings associations. date of this order, or later than three months after the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 605 effective date of this order, unless such period is ex- mortgage-related securities, consumer receivabletended by the Board or by the Federal Reserve Bank of related securities, and commercial paper (hereinafter Cleveland, acting pursuant to delegated authority. "bank-ineligible securities"); By order of the Board of Governors, effective (2) Acting as agent in the private placement of all April 19, 1995. types of securities, including providing related advisory services, and buying and selling securities on the Voting for this action: Chairman Greenspan, Vice Chairman order of investors as a "riskless principal"; Blinder, and Governors Kelley, LaWare, Lindsey, Phillips, and (3) Underwriting and dealing in bank-eligible instru- Yellen. ments pursuant to 12 C.F.R. 225.25(b)(16); (4) Providing securities brokerage services pursuant to JENNIFER J. JOHNSON 12 C.F.R. 225.25(b)(15), including providing such ser- Deputy Secretary of the Board vices with respect to bank-ineligible securities that Company holds as principal in connection with its Appendix underwriting and dealing activities; (5) Providing investment advisory services pursuant Branch offices of Falls Savings Bank, F.S.B., to be to 12 C.F.R. 225.25(b)(4); and established by Fifth Third Bank of Northeastern Ohio: (6) Providing foreign exchange advisory and transactional services pursuant to 12 C.F.R. 225.25(b)(17). 1. 2335 Second Street, Cuyahoga Falls, Ohio 2. 4301 Kent Road, Stow, Ohio Notice of the proposal, affording interested persons an 3. 40 North Avenue, Tallmadge, Ohio opportunity to submit comments, has been published 4. 1597 S. Water Street, Kent, Ohio (60 Federal Register 13,436 (1995)). The time for filing 5. 3150 S. Arlington Road, Akron, Ohio comments has expired, and the Board has considered the 6. 122 W. Streetsboro Street, Hudson, Ohio notice and all comments received in light of the public 7. 911 Graham Road, Unit 96, Cuyahoga Falls, Ohio interest factors set forth in section 4(c)(8) of the BHC 8. 576 Canton Road, Akron, Ohio Act. 9. 1900 West Market Street, Akron, Ohio Applicant, with total consolidated assets of $39 bil- 10. 230 Howe Avenue, Cuyahoga, Ohio lion, is the 24th largest commercial banking organization 11. 360 E. Waterloo Road, Akron, Ohio in the United States.2 Applicant operates banking subsid- 12. 4602 Fishcreed Road, Stow, Ohio iaries in Pennsylvania, Delaware, Maryland, New York, 13. 3750-Q West Market Street, Akron, Ohio and New Jersey, and engages in various nonbanking activities through a number of subsidiaries. Company Mellon Bank Corporation would register with the Securities and Exchange Com- Pittsburgh, Pennsylvania mission ("SEC") as a broker-dealer under the Securities Exchange Act of 1934 (15 U.S.C. § 78a et seq.) and Order Approving a Notice to Engage in Underwriting become a member of the National Association of Securiand Dealing in Certain Bank-Ineligible Securities on a ties Dealers, Inc. ("NASD"). Therefore, Company Limited Basis, and Other Nonbanking Activities would be subject to the recordkeeping, reporting, fiduciary standards, and other requirements of the Securities Mellon Bank Corporation, Pittsburgh, Pennsylvania Exchange Act of 1934, the SEC, and the NASD. ("Applicant"), has provided notice under section 4(c)(8) All the proposed activities, except underwriting and of the Bank Holding Company Act (12 U.S.C. dealing in bank-ineligible securities and conducting pri- § 1843(c)(8)) ("BHC Act") and section 225.23 of the vate placement and "riskless principal" activities, have Board's Regulation Y (12 C.F.R. 225.23) of its intention been determined by regulation to be closely related to to establish a section 20 subsidiary, Mellon Financial banking for purposes of section 4(c)(8) of the BHC Act.3 Markets, Inc., Pittsburgh, Pennsylvania ("Company"), Applicant has committed that Company will conduct which would engage in the following activities:1 these activities in accordance with the limitations set (1) Underwriting and dealing, to a limited extent, in forth in Regulation Y and the Board's orders relating to certain municipal revenue bonds (including certain these activities.4 unrated municipal revenue bonds), 1-4 family 1. Mellon would implement its proposal through a corporate reorgani- 2. Asset data are as of December 31, 1994. zation. In order to effect this reorganization, Mellon Bank, N.A., Pitts- 3. See 12 C.F.R. 225.25(b)(4), (b)(15), (b)(16) and (b)(17). burgh, Pennsylvania, would transfer 100 percent of the outstanding 4. The Board notes that in order to address potential conflicts of stock of Company to Applicant through a dividend. Company currently interests arising from Company's conduct of full-service brokerage engages in securities brokerage activities. activities together with underwriting and dealing in bank-ineligible Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

606 Federal Reserve Bulletin • June 1995 Underwriting and Dealing in Bank-Ineligible exception, Company will conduct the proposed under- Securities writing and dealing activities using the same methods and procedures, and subject to the same prudential limi- Applicant proposes to underwrite and deal in municipal tations, as were established by the Board in its previous revenue bonds, residential mortgage-related securities, orders.8 consumer receivable-related securities, and commercial Applicant has requested that the Board permit up to paper. The Board previously has determined that, subject two directors of its subsidiary banks to serve on Compato the prudential framework of limitations established in ny's board of directors, as long as those directors do not previous decisions to address potential conflicts of inter- constitute a majority of Company's board. These direcest, unsound banking practices, or other adverse effects, tors would not be officers of any affiliated bank; nor the proposed underwriting and dealing activities are so would they have the authority to conduct the day-to-day closely related to banking as to be proper incidents business of the bank or handle individual bank transacthereto within the meaning of section 4(c)(8) of the BHC tions. No officers or employees of Company would be Act.5 The Board also has determined that the conduct of employed by the banks. these securities underwriting and dealing activities is The Board previously has permitted interlocks beconsistent with section 20 of the Glass-Steagall Act, tween a banking organization and its affiliated section 20 provided that the underwriting and dealing subsidiary company.9 In addition, the Board has requested comderives no more than 10 percent of its total gross reve- ment on modifying the section 20 prudential framework nue over any two-year period from underwriting and to permit interlocks with affiliated banks as long as a dealing in securities that a bank may not underwrite or majority of the board is not comprised of bank officers or deal in directly.6 Applicant has committed that Company directors. Accordingly, the Board finds that these limited will conduct its underwriting and dealing activities with interlocks should be permitted, since it appears that respect to bank-ineligible securities subject to the 10 per- Company would be operationally distinct from its affilicent revenue test established by the Board in previous ated banks. The Board expects that Applicant will ensure orders.7 Applicant also has committed that, with one that the framework established pursuant to the Section 20 Order will be maintained in all other respects. securities, Applicant has committed that Company will inform its Private Placement and "Riskless Principal" Activities customers at the commencement of the relationship that, as a general matter, Company may be a principal or may be engaged in underwriting Private placement involves the placement of new issues with respect to, or may purchase from an affiliate, those securities for which brokerage and advisory services are provided. In addition, at the of securities with a limited number of sophisticated time any brokerage order is taken, the customer will be informed purchasers in a nonpublic offering. A financial intermedi- (usually orally) whether Company is acting as agent or principal with respect to a security. Confirmations sent to customers also will state ary in a private placement transaction acts solely as an whether Company is acting as agent or principal. See PNC Financial agent of the issuer in soliciting purchasers, and does not Corp., 75 Federal Reserve Bulletin 396 (1989). purchase the securities and attempt to resell them. Secu- 5. See Citicorp, J.P. Morgan & Company Incorporated, and Bankers Trust New York Corporation, 73 Federal Reserve Bulletin 473 (1987), rities that are privately placed are not subject to the aff'd sub nom. Securities Industry Association v. Board of Governors of registration requirements of the Securities Act of 1933, the Federal Reserve System, 839 F.2d 47 (2d Cir. 1988), cert, denied, and are offered only to financially sophisticated institu- 486 U.S. 1059 (1988) ("Section 20 Order"). 6. Compliance with the 10-percent revenue limitation shall be calcu- tions and individuals and not to the public. Applicant lated in accordance with the method stated in J. P. Morgan & Co. will not privately place registered securities and will Incorporated, et al., 75 Federal Reserve Bulletin 192, 196-197 (1989), as modified by the Order Approving Modifications to the Section 20 only place securities with customers who qualify as Orders, 75 Federal Reserve Bulletin 751 (1989), the Order Approving accredited investors. Modifications to the Section 20 Orders, 79 Federal Reserve Bulletin "Riskless principal" is the term used in the securities 226 (1993), and the Supplement to Order Approving Modifications to Section 20 Orders, 79 Federal Reserve Bulletin 360 (1993) (collective- business to refer to a transaction in which a brokerly, "Modification Orders"). The Board notes that Applicant has not dealer, after receiving an order to buy (or sell) a security adopted the Board's alternative indexed-revenue test to measure compliance with the 10-percent revenue limitation on bank-ineligible securi- from a customer, purchases (or sells) the security for its ties activities, and, absent such election, Applicant will continue to employ the Board's original 10-percent revenue standard. 7. The Board notes that Company may provide services that are 8. In connection with the proposal that Company underwrite and deal necessary incidents to approved underwriting and dealing activities, in unrated municipal revenue bonds, Applicant has committed that provided that any activities conducted as a necessary incident to bank- Company will comply with the limitations and conditions previously ineligible securities activities must be treated as part of the bank- relied on by the Board. See Letter Interpreting Section 20 Orders, 81 ineligible securities activities unless Company has received specific Federal Reserve Bulletin 198 (1995). approval under section 4(c)(8) of the BHC Act to conduct the activities 9. See e.g., Synovus Financial Corporation, 11 Federal Reserve independently. Until such approval is obtained, any revenues from the Bulletin 954, 955 (1991); Banc One Corporation, 76 Federal Reserve incidental activities must be counted as ineligible revenues subject to Bulletin 756, 758 (1990); Canadian Imperial Bank of Commerce, The the 10-percent revenue limitations set forth in the Section 20 Order, as Royal Bank of Canada, Barclays PLC and Barclays Bank PLC, 76 modified by the Modification Orders. Federal Reserve Bulletin 158 (1990). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 607 own account to offset a contemporaneous sale to (or tices, and other adverse effects imposed by the Board in purchase from) the customer.10 Riskless principal trans- connection with underwriting and dealing in securities.14 actions are understood in the industry to include only transactions in the secondary market. Thus, Applicant Financial Factors, Managerial Resources, and Other proposes that Company would not act as a riskless Considerations principal in selling securities at the order of a customer that is the issuer of the securities to be sold, or in any In every notice under section 4 of the BHC Act, the transaction where Company has a contractual agreement Board considers the financial condition and resources of to place the securities as agent of the issuer. Company the applicant and its subsidiaries and the effect of the also would not act as a riskless principal in any transac- transaction on these resources.15 Based on the facts of tion involving a security for which it makes a market. this case, the Board concludes that financial consider- The Board has determined by order that, subject to ations are consistent with approval of this notice. The prudential limitations that address the potential for con- managerial resources of Applicant also are consistent flicts of interests, unsound banking practices, or other with approval. adverse effects, the proposed private placement and risk- In order to approve this notice, the Board is required less principal activities are so closely related to banking to determine that the performance of the proposed activas to be a proper incident thereto within the meaning of ities by Applicant can reasonably be expected to produce section 4(c)(8) of the BHC Act.11 public benefits that outweigh adverse effects under the The Board also has determined that acting as agent in proper incident to banking standard of section (4)(c)(8) the private placement of securities, and purchasing and of the BHC Act. Under the framework established in this selling securities on the order of investors as a riskless order and prior decisions, consummation of this proposal principal, do not constitute underwriting and dealing in is not likely to result in any significantly adverse effects, securities for purposes of section 20 of the Glass- such as undue concentration of resources, decreased or Steagall Act, and that revenue derived from these activi- unfair competition, conflicts of interests, or unsound ties is not subject to the 10-percent revenue limitation on banking practices, that are not outweighed by public bank-ineligible securities underwriting and dealing.12 benefits. The Board expects that the entry of Applicant Applicant has committed that Company will conduct into the market for the proposed activities would provide its private placement and riskless principal activities added convenience to Applicant's customers, and would using the same methods and procedures, and subject to increase the level of competition among existing providthe same prudential limitations established by the Board ers of these services. Accordingly, the Board has deterin Bankers Trust and J. P. Morgan,13 including the com- mined that the performance of the proposed activities by prehensive framework of restrictions designed to avoid Applicant can reasonably be expected to produce public potential conflicts of interests, unsound banking prac- benefits that would outweigh possible adverse effects under the proper incident to banking standard of section 4(c)(8) of the BHC Act. Based on all the facts of record, and subject to the commitments made by Applicant, as well as all the terms and conditions set forth in this order and in the above- 10. See Securities and Exchange Commission Rule 10b-10. 17 C.F.R. 240.10b-10(a)(8)(i). 11. See J.P. Morgan & Company Incorporated, 76 Federal Reserve Bulletin 26 (1990) ("J.P. Morgan )\ Bankers Trust New York Corpora- 14. In previous orders approving riskless principal activities, the tion, 75 Federal Reserve Bulletin 829 (1989) ("Bankers Trust"). Board has relied on commitments by bank holding companies to refrain 12. See Bankers Trust at 831-833. from entering quotes for specific securities in the NASDAQ or any other 13. Among the prudential limitations detailed more fully in Bankers dealer quotation system in connection with riskless principal transac- Trust and J.P. Morgan are that Company will maintain specific records tions. Bankers Trust at 832. Applicant proposes that Company, in acting that will clearly identify all riskless principal transactions, and that as a riskless principal, be permitted to enter bid or ask quotations, or Company will not engage in any riskless principal transactions for any publish "offering wanted" or "bid wanted" notices, on trading systems securities carried in its inventory. When acting as a riskless principal, other than an exchange or the NASDAQ. Company will not hold itself out as making a market in the securities In order to ensure that Company would not hold itself out as a market that it buys and sells as a riskless principal. Moreover, Company will maker with respect to securities for which it acted as riskless principal, not engage in riskless principal transactions on behalf of any foreign Applicant has committed that Company will not enter price quotations affiliate that engages in securities dealing activities outside the United on different sides of the market for a particular security for two business States and will not act as riskless principal for registered investment days. In other words, Company would not enter an "ask" quote for two company securities. In addition, Company will not act as a riskless business days after entering a "bid" quote with respect to the same principal with respect to any securities of investment companies that are security, and vice versa. The Board previously has determined that these advised by Applicant or any of its affiliates. With regard to private activities are permissible and do not constitute underwriting and dealing placement activities, Applicant has committed that Company will not in securities for purposes of the Glass-Steagall Act. See BankAmerica privately place registered investment company securities or securities of Corporation, 79 Federal Reserve Bulletin 1163, 1165 n. 10 (1993); investment companies that are advised by Applicant or any of its Dauphin Deposit Corporation, 77 Federal Reserve Bulletin 672 (1991). affiliates. 15. See 12 C.F.R. 225.24. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

608 Federal Reserve Bulletin • June 1995 noted Board orders, the Board has determined that the Mortgage"),1 and thereby indirectly acquire the subsidnotice should be, and hereby is, approved. Approval of iary banks of Central Mortgage.2 Mercantile also has this proposal is specifically conditioned on compliance provided notice under section 4(c)(8) of the BHC Act by Applicant and Company with the commitments made (12 U.S.C. § 1843(c)(8)) of its intention to acquire the in connection with its notice and with the conditions mortgage banking activities of Central Mortgage and a referenced in this order and the other referenced orders. nonbanking subsidiary of Central Mortgage, Cenco In- The Board's determination also is subject to all of the surance Company, Inc., Phoenix, Arizona, and thereby conditions set forth in Regulation Y, including those in engage in making, acquiring or servicing loans or other sections 225.7 and 225.23(b), and to the Board's author- extensions of credit and reinsuring credit life, accident ity to require modification or termination of the activities and health insurance, pursuant to sections 225.25(b)(1) of a bank holding company or any of its subsidiaries as and 225.25(b)(8) of the Board's Regulation Y. the Board finds necessary to assure compliance with, and Notice of this proposal, affording interested persons an to prevent evasion of, the provisions of the BHC Act and opportunity to submit comments, has been published the Board's regulations and orders issued thereunder. In (59 Federal Register 59,618 (1994)). The time for filing approving this notice, the Board has relied on all the comments has expired, and the Board has considered the facts of record, and all the representations and commit- proposal and all comments received in light of the facments made by Applicant. For the purpose of this action, tors set forth in sections 3 and 4 of the BHC Act. these commitments and conditions shall be deemed con- Mercantile, with total consolidated assets of approxiditions imposed in writing and, as such, may be enforced mately $12.2 billion, operates banks in Missouri, Iowa, in proceedings under applicable law. Illinois, and Kansas.3 Mercantile is the second largest This transaction shall not be consummated later than commercial banking organization in Missouri, controlthree months after the effective date of this order, unless ling approximately $7.2 billion in deposits, representing such period is extended for good cause by the Board or approximately 12.6 percent of the total deposits in comby the Federal Reserve Bank of Cleveland pursuant to mercial banks in the state. Central Mortgage, with total delegated authority. consolidated assets of $1.3 billion, is the 13th largest By order of the Board of Governors, effective commercial banking organization in Missouri, control- April 17, 1995. ling $567 million in deposits, representing approximately 1 percent of the total deposits in commercial Voting for this action: Chairman Greenspan, Vice Chairman banks in the state. Upon consummation of the proposal, Blinder, and Governors Kelley, LaWare, Lindsey, Phillips, and Mercantile would remain the second largest commercial Yellen. banking organization in Missouri, controlling approximately $7.7 billion in deposits, representing approxi- JENNIFER J. JOHNSON Deputy Secretary of the Board mately 13.6 percent of the total deposits in commercial banks in the state. Orders Issued Under Sections 3 and 4 of the Competitive Considerations Bank Holding Company Act Mercantile and Central Mortgage compete directly in the Johnson County, Kansas City, and Morgan County bank- Mercantile Bancorporation, Inc. ing markets, all in Missouri. Mercantile is the seventh St. Louis, Missouri largest of nine depository institutions4 in the Johnson Ameribanc, Inc. St. Louis, Missouri 1. Mercantile also has acquired an option to purchase up to Order Approving the Acquisition of a Bank Holding 19.9 percent of the voting shares of Central Mortgage, which option would expire upon consummation of this proposal. Company 2. Central Mortgage has three subsidiary banks: Citizens Bank of Southwest Missouri, Nevada; Citizens-Jackson County Bank, Warrensburg; and Farmers Bank of Stover, Stover, all in Missouri. Mercantile Bancorporation, Inc., and its wholly owned 3. Asset data and state deposit data are as of December 31, 1994. subsidiary, Ameribanc, Inc., both of St. Louis, Missouri 4. When used in this context, depository institution includes commer- (together, "Mercantile"), bank holding companies cial banks, savings banks and savings associations. Market share data are based on calculations in which the deposits of thrift institutions are within the meaning of the Bank Holding Company Act included at 50 percent. The Board previously has indicated that thrift ("BHC Act"), have applied under section 3 of the BHC institutions have become, or have the potential to become, major Act (12 U.S.C. § 1842) to acquire Central Mortgage competitors of commercial banks. See Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989); National City Corporation, 70 Bancshares, Inc., Warrensburg, Missouri ("Central Federal Reserve Bulletin 743 (1984). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 609 County banking market,5 controlling deposits of states adjoining Missouri.10 Based on all the facts of $19.3 million, representing approximately 6.1 percent of record, including Mercantile's divestiture commitments total deposits in depository institutions in this market and the number of competitors that would remain in the ("market deposits").6 Central Mortgage is the largest market, the Board concludes that consummation of this depository institution in the Johnson County banking proposal would not result in significantly adverse effects market, with deposits of $98.2 million, representing on competition in the Johnson County banking market. approximately 31 percent of market deposits. Upon con- In the Morgan County banking market,11 the increase summation of this proposal, Mercantile would become in concentration of market deposits resulting from conthe largest depository institution in the Johnson County summation of this acquisition, as measured by the HHI, banking market, controlling deposits of approximately indicates that the proposal could result in significantly $117.5 million, representing approximately 37.1 percent adverse competitive effects.12 In order to mitigate any of market deposits. The Herfindahl-Hirschman Index potential adverse competitive effects in this market, Mer- ("HHI") for the market would increase by 379 points to cantile has committed that it will divest Farmers Bank of 2278.7 Stover, the only depository institution controlled by Cen- In order to mitigate the adverse competitive effects in tral Mortgage that currently competes in the Morgan the Johnson County banking market that otherwise might County banking market. Based on all the facts of record, result from this proposal, Mercantile has committed to including Mercantile's commitment to divest Farmers divest Central Mortgage's Chilhowee, Missouri, branch Bank of Stover, the Board concludes that consummation ("Branch"). Mercantile has committed that Branch will of this proposal would not result in significantly adverse be divested to an organization that does not currently effects on competition in the Morgan County banking operate in the Johnson County banking market.8 With market.13 this divestiture, upon consummation of the proposed In the Kansas City banking market, which is approxitransaction the HHI would increase by 247 points to mated by the Kansas City Ranally Metropolitan Area, 2146. consummation of this proposal would not exceed the In addition, the number of depository institutions com- thresholds set forth in the Department of Justice Merger peting in the market would remain unchanged and sev- Guidelines.14 In addition, numerous competitors would eral remaining competitors would have significant mar- remain in the Kansas City banking market after consumket shares. The record in this case also indicates that this mation of this proposal. market, which borders the Kansas City MSA, appears to The Board sought comments from the United States be attractive to entry.9 There also are numerous potential Attorney General on the competitive effects of this proentrants into the Johnson County banking market, be- posal. The Attorney General did not object to the procause Missouri permits statewide branching and acquisi- posed acquisition and agreed, based on the proposed tions by out-of-state bank holding companies located in divestitures, to shorten the post-approval waiting period. Based on all the facts of record, including the facts discussed above and the divestitures proposed by Mercantile,15 the Board concludes that consummation of this 5. The Johnson County banking market is approximated by Johnson County, Missouri. 6. Market deposit data are as of June 30, 1994, unless otherwise noted. 10. See Mo. ANN. STAT §§ 362.107 and 362.925. 7. Under the revised Department of Justice Merger Guidelines (49 11. The Morgan County banking market is approximated by Morgan Federal Register 26,823 (June 29, 1984)), a market in which the post- County, Missouri. merger HHI is above 1800 is considered to be highly concentrated. The 12. Upon consummation of this proposal, the HHI in the market Justice Department has informed the Board that a bank merger or would increase by 639 points to 4918. acquisition generally will not be challenged (in the absence of other 13. Mercantile has committed to sell Farmers Bank of Stover either to factors indicating anti-competitive effects) unless the post-merger HHI an out-of-market organization or to a current market competitor whose is at least 1800 and the merger increases the HHI by 200 points. The acquisition of this bank would not cause the HHI to increase by more Justice Department has stated that the higher than normal HHI thresh- than 200 points. olds for screening bank mergers for anti-competitive effects implicitly 14. The HHI in the Kansas City banking market would increase by recognize the competitive effects of limited-purpose lenders and other 11 points to 742. Market deposit data for the Kansas City banking non-depository financial entities. market are as of June 30, 1993. 8. The Board has received comments from the Farmers Produce 15. As part of its commitment to divest Branch and Farmers Bank of Exchange stating that Chilhowee, Missouri, is located in a rural area Stover, Mercantile has committed to execute sales agreements for each and that closure of Branch would inconvenience the community. Be- of the proposed divestitures prior to consummation of this proposal, and cause the divestiture of Branch to an out-of-market competitor would to complete these divestitures within 180 days of consummation. Merresult in Branch's continuing to operate, the Board does not believe that cantile also has committed that in the event it is unsuccessful in consummation of this proposal would adversely affect the Chilhowee completing these divestitures within 180 days of consummation, it will community. transfer Branch and Farmers Bank of Stover to an independent trustee 9. The population of Johnson County, a non-MSA county, increased that is acceptable to the Board and that will be instructed to sell Branch by 4 percent from 1990 to 1994, compared with average increases of and Farmers Bank of Stover promptly. In addition, Mercantile has 2.7 percent for Missouri as a whole and 3.1 percent for MSA counties in committed to submit to the Board, before consummation of the acquisi- Missouri over the same time period. tion of Central Mortgage, an executed trust agreement acceptable to the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

610 Federal Reserve Bulletin • June 1995 proposal would not have a significantly adverse effect on In its consideration of the convenience and needs competition or the concentration of banking resources in factor, the Board has carefully reviewed the entire CRA any relevant banking market. performance record of Mercantile, Central Mortgage, and their subsidiaries; all comments received on this Convenience and Needs Considerations proposal, including Mercantile's response to these comments; and all other relevant facts of record, in light of In acting on an application to acquire a depository insti- the CRA, the Board's regulations, and the Statement of tution under the BHC Act, the Board must consider the the Federal Financial Supervisory Agencies Regarding convenience and needs of the communities to be served, the Community Reinvestment Act ("Agency CRA Stateand take into account the records of the relevant deposi- ment").20 tory institutions under the Community Reinvestment Act (12 U.S.C. § 2901 et seq.) ("CRA"). The CRA requires Record of CRA Performance the federal financial supervisory agencies to encourage financial institutions to help meet the credit needs of the A. Evaluation of CRA Performance local communities in which they operate, consistent with their safe and sound operation. To accomplish this end, The Agency CRA Statement provides that a CRA examthe CRA requires the appropriate federal supervisory ination is an important and often controlling factor in the authority to "assess the institution's record of meeting consideration of an institution's CRA record and that the credit needs of its entire community, including low- reports of these examinations will be given great weight and moderate-income neighborhoods, consistent with in the applications process.21 In this case, the Board the safe and sound operation of such institution," and to notes that all 41 of Mercantile's subsidiary banks retake that record into account in its evaluation of applica- ceived "outstanding" or "satisfactory" ratings in the tions.16 most recent examinations of their CRA performance. The Board has received comments from the Con- MBKC received a "satisfactory" rating from the Federal cerned Clergy Coalition ("Protestant") alleging that Reserve Bank of Kansas City at its most recent examina- Mercantile's subsidiary bank, Mercantile Bank of Kan- tion of CRA performance, as of July 1993. In addition, sas City, Kansas City, Missouri ("MBKC"), has failed MBSL received an "outstanding" CRA performance to meet the credit needs of its local community, espe- rating from its primary federal supervisor, the Office of cially the Eastside neighborhoods of Kansas City ("East- the Comptroller of the Currency, as of January 1993, and side").17 In particular, Protestant maintains that data MBK received a "satisfactory" CRA performance rating from its primary federal supervisor, the Federal Deposit submitted by MBKC under the Home Mortgage Disclo- Insurance Corporation ("FDIC"), as of March 1994. sure Act ("HMDA") indicate disparities in the denial Central Mortgage's subsidiary banks received "satisfacrates for loan applications submitted by minorities comtory" ratings at their most recent CRA examinations. pared with those for white applicants, particularly for home improvement loans.18 Protestant also asserts that MBKC engages in a low level of lending to small B. HMDA and Lending Practices businesses, minorities and low- and moderate-income residents, and has inadequate marketing, outreach, credit The Board has carefully reviewed the 1992 and 1993 needs assessment, product development, and community HMDA data reported by MBKC for the Kansas City development programs. Protestant attributes some of MSA and the Eastside, in light of Protestant's com- MBKC's CRA-related shortcomings to the failure of ments. The 1993 HMDA data, including data on home MBKC's management to adequately monitor, coordinate improvement loans, indicate a decrease in the percentage and implement its CRA program and to turnover of CRA of loan applications from African Americans that were staff.19 denied.22 The 1993 HMDA data also indicate a decrease in the percentage of home improvement loan applica- Board stating the terms of the divestitures. The Board's action is expressly conditioned on compliance with these commitments. N.A., St. Louis, Missouri ("MBSL"), and Mercantile Bank of Kansas, 16. 12 U.S.C. § 2903. Shawnee Mission, Kansas ("MBK"). In particular, Protestant states that 17. Protestant defines the Eastside as the area bounded by Troost MBSL's HMDA data indicate that MBSL's racial disparity ratio for Avenue, Elmwood Avenue, Independence Avenue, and 85th Street. loan application denials is much higher than that of other lenders, and 18. Protestant also claims that MBKC discourages or prescreens that the most recent CRA evaluation of MBK found violations of the potential loan applicants and has inadequate policies, procedures and Equal Credit Opportunity Act ("ECOA"), Fair Housing Act ("FHA"), training programs to ensure that there is no discrimination in its lending and HMDA. activities. 20. 54 Federal Register 13,742 (1989). 19. Protestant states that additional evidence of Mercantile's inade- 21. Id. at 13,745. quate efforts to lend to minorities is provided by the records of two of 22. Although the number of home mortgage loans reported by MBKC Mercantile's other subsidiary banks, Mercantile Bank of St. Louis, under HMDA for the Kansas City MSA decreased by approximately Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 611 tions from low- and moderate-income applicants that MBKC also offers housing-related loans to low- and were denied. moderate-income borrowers through its Community The HMDA data also reflect, however, disparities in Partnership Program ("CPP"), which features flexible denial and origination rates by racial group. The Board is underwriting guidelines,24 and the Rehabilitation Loan concerned when the record of an institution indicates Corporation's ("RLC") "70/30" program and the Misdisparities in lending to minority applicants, and be- souri Housing Development Corporation's ("MHDC") lieves that all banks are obligated to ensure that their "80/20" program, which offer low- and moderatelending practices are based on criteria that assure not income home buyers partially subsidized mortgages. In only safe and sound lending, but also assure equal access 1993, MBKC originated eight loans, totalling $325,800, to credit by creditworthy applicants, regardless of race. through the CPP, RLC, and MHDC programs, and in The Board also recognizes that HMDA data alone have 1994, MBKC originated SP loans, totalling $357,870, limitations that make the data an inadequate basis, ab- under these programs.25 sent other information, for conclusively determining MBKC also assists in meeting the affordable housing whether an institution has engaged in illegal discrimina- and other needs of low- and moderate-income residents tion in making lending decisions. throughout its delineated community by participating in The Board notes that the most recent CRA examina- community development programs. In the Eastside comtions of MBKC, MBK, and MBSL, found no evidence of munity, MBKC has committed to provide $2.1 million to any pattern or practice of discriminatory credit practices, the Mount Cleveland project to assist in the construction or other practices designed to discourage credit applica- of 84 low- and moderate-income housing units and tions.23 Examiners found that the banks' delineations of $500,000 to the Twelfth Street Heritage Development their local communities were reasonable and did not Corporation to fund mortgage loans for low- and arbitrarily exclude low- and moderate-income communi- moderate-income borrowers.26 In addition, MBKC has ties. provided $1.3 million for the construction of the Swope MBKC has taken steps to ensure that all loan appli- Parkway Health Center, a health facility to be located in cants are treated equally in the lending process. For the Eastside. MBKC also has provided $5.9 million to example, in June 1994, MBKC employees who partici- help finance the Glover Plan, a project intended to redepate in the loan application process were given formal velop downtown Kansas City. training to increase their sensitivity to fair lending is- MBKC provides funding to meet the credit needs of sues. In addition, MBKC recently established a second small businesses in low- and moderate-income commureview program to help ensure equal treatment of bor- nities. In 1994, MBKC made 308 loans, totalling $9.6 milrowers in the lending process by requiring the appropri- lion, to small businesses, including 19 loans, totalling ate department manager to review declined residential $570,000, to small businesses located in the Eastside.27 mortgage and certain consumer loan applications. MBKC has taken a number of steps to meet housing- C. Other Elements of CRA Performance related and other credit needs within its community. For example, MBKC participates in the Insured Credit Ser- MBKC uses various methods to ascertain community vices Loan Program ("ICSLP"), which offers unsecured credit needs, including direct contacts with community privately-insured home improvement and all purpose groups, religious groups, and local government.28 In loans using flexible underwriting criteria. In 1994, MBKC made 251 ICSLP loans, totalling $1.7 million, including 29 loans, totalling $124,000, to Eastside resi- 24. Under the CPP program, low- and moderate-income applicants dents. In addition, MBKC offers home improvement may qualify for long-term financing for up to 95 percent of the home purchase price. No fees are assessed under this program. loans guaranteed by the state of Missouri through the 25. In 1994, MBKC made four loans, totalling $135,000, to Eastside Missouri Housing Development Corporation Home Im- residents through the CPP, RLC, and MHDC programs, compared to provement Loan Program. In 1994, MBKC made nine one $15,200 loan to an Eastside resident under these programs in 1993. 26. MBKC's commitment to the Twelfth Street Heritage Develophome improvement loans, totalling $65,456, through this ment Corporation was made in January 1995. Protestant contends that program, including three loans, totalling $17,271, to the Board should not rely on commitments made for future lending or new programs developed by MBKC because MBKC previously has Eastside residents. failed to implement CRA-related programs that it announced. In reviewing the record of performance of MBKC under the CRA, the Board has relied on MBKC's established record of meeting the credit needs of its local community. 27. MBKC's 1994 small-business lending reflected a significant 40 percent from 1992 to 1993, MBKC sustained its level of lending to increase over 1993, when it made 184 small business loans, totalling minorities and Eastside residents over the same time period. approximately $5.7 million. MBKC defines small business loans as 23. While FDIC examiners of MBK found some violations of the business loans of less than $100,000. ECOA, FHA, and HMDA, the examiners did not conclude that MBK 28. For example, MBKC is a member of the Community Lenders was engaged in discriminatory lending practices. Luncheon, a forum for lenders and community development agencies in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

612 Federal Reserve Bulletin • June 1995 addition, MBKC co-sponsors and participates in educa- and their subsidiary depository institutions, are consistional programs for minorities and low- and moderate- tent with approval of these applications.29 income residents on consumer and commercial lending programs available through MBKC. Other Considerations The 1993 CRA performance examination of MBKC found that MBKC's marketing program was generally The Board also concludes that the financial and managedesigned to reach its entire delineated community, in- rial resources and future prospects of Mercantile and cluding low- and moderate-income areas. MBKC mar- Central Mortgage, and their respective subsidiaries, are kets its products and services through print media, direct consistent with approval. Factors relating to the other mail and radio. These activities include marketing efforts supervisory factors the Board must consider under secspecifically for minorities. For example, MBKC adver- tion 3 of the BHC Act also are consistent with approval. tises in newspapers circulated in primarily minority com- Mercantile also proposes to engage in making, acquirmunities and on a radio station that focuses on African- ing, and servicing loans or other extensions of credit and American audiences. reinsuring credit life, accident and health insurance. The The 1993 CRA performance examination also found Board previously has determined that these activities are that MBKC's directors play an active role in the CRA closely related to banking and permissible for bank process and regularly monitor the bank's compliance holding companies under section 4(c)(8) of the BHC Act with the CRA. MBKC's CRA Committee consisting of and Regulation Y.30 Mercantile has committed to consenior managers and three bank directors, oversees all duct these activities in accordance with the Board's bank CRA initiatives and reviews the geographic distri- regulations. The record in this case indicates that there bution of MBKC's lending activities. The CRA Commit- are numerous providers of these services and that this tee makes quarterly reports of MBKC's CRA activities proposal should provide added convenience to the custo MBKC's board of directors. tomers of Mercantile and Central Mortgage. There is no Protestant has expressed concern that this proposal evidence in the record to indicate that consummation of would result in the closing of a branch that serves this proposal is likely to result in any significantly ad- Eastside residents ("Prospect Branch"). The 1993 CRA verse effects, such as undue concentration of resources, performance examination of MBKC noted that MBKC decreased or unfair competition, conflicts of interests, or operates branches throughout the Kansas City MSA, and unsound banking practices, that would not be outreported that the bank had adequate written policies and weighed by the likely public benefits of this proposal. procedures to mitigate the effects of branch closings in Accordingly, the Board has determined that the balance its community. These policies and procedures provide of public interest factors it must consider under section that MBKC will consider the impact of a branch closing 4(c)(8) of the BHC Act is favorable and consistent with on the community and provide notice of a proposed approval of this proposal. branch closing to customers of the branch at least 90 days prior to the proposed closing. Conclusion on Convenience and Needs Factors 29. Protestant has asked the Board to hold a public hearing or public meeting to consider Mercantile's record in meeting its responsibilities under the CRA. Section 3(b) of the BHC Act does not require the Board The Board has carefully considered all the facts of to hold a hearing or meeting on an application unless the appropriate record in this case, including the comments received, in supervisory authority of the bank to be acquired makes a timely written recommendation of denial of the application. In this case, the Board has reviewing the convenience and needs factor under the not received such a recommendation. Generally, under the Board's BHC Act. Based on a review of the entire record, includ- Rules of Procedure, the Board may, in its discretion, hold a public hearing or meeting on an application to clarify factual issues related to ing the programs and record of performance discussed the application and to provide an opportunity for testimony, if appropriabove, information provided by Mercantile, and relevant ate. 12 C.F.R. 262.3(e) and 262.25(d). The Board has carefully considreports of examination, the Board concludes that conve- ered Protestant's request. In the Board's view, Protestant has had an opportunity to present written submissions, and Protestant has submitnience and needs considerations, including the CRA ted substantial written comments that have been considered by the performance records of Mercantile, Central Mortgage, Board. In light of all the facts of record ,the Board has determined that a public hearing or meeting is not necessary to clarify the factual record in this proposal, and is not otherwise warranted in this case. Accordingly, the request for a public hearing or meeting on these applications is denied. Protestant also has stated that a thorough investigation of Mercantile's monitoring systems or internal testing of its affiliates for fair Kansas City that gives lenders the opportunity to learn more about housing compliance should be made before approval of this proposal. development activities in Kansas City in which lenders can participate, These areas are reviewed in CRA performance and compliance examiand the Single Family Working Committee, in which lenders and nations. As noted above, examiners of MBKC, MBK, and MBSL, did governmental agencies explore ways to provide affordable single- not find any evidence of discriminatory lending practices. family housing to low- and moderate-income areas. 30. See 12 C.F.R. 225.25(b)(1) and (b)(8) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 613 Based on the foregoing and other facts of record, the branches at the current locations of the four NationsBank Board has determined that the applications and notice of Virginia branches.1 should be, and hereby are, approved. The Board's ap- Notice of the applications, affording interested persons proval is expressly conditioned on Mercantile's compli- an opportunity to submit comments, has been given in ance with all the commitments made in connection with accordance with the Bank Merger Act and the Board's the applications and notice. The determination on the Rules of Procedure (12 C.F.R. 262.3(b)). As required by nonbanking activities is subject to all the conditions in the Bank Merger Act, reports on the competitive effects Regulation Y, including those in sections 225.7 and of the merger were requested from the United States 225.23(b)(3), and to the Board's authority to require Attorney General, the Office of the Comptroller of the such modification or termination of the activities of a Currency ("OCC"), and the Federal Deposit Insurance holding company or any of its subsidiaries as the Board Corporation ("FDIC"). The time for filing comments finds necessary to assure compliance with, or to prevent has expired, and the Board has considered the applicaevasion of, the provisions and purposes of the BHC Act tions and all comments received in light of the factors set and the Board's regulations and orders issued thereun- forth in the Bank Merger Act and section 9 of the der. The commitments and conditions relied on by the Federal Reserve Act. Board in reaching this decision are deemed to be condi- Premier is a subsidiary of Premier Bankshares, Wythetions imposed in writing by the Board in connection with ville, Virginia, which is the 12th largest commercial its findings and decision, and, as such, may be enforced banking organization in Virginia, controlling $495.9 milin proceedings under applicable law. lion of deposits, representing 1 percent of total deposits The acquisition of Central Mortgage's subsidiary in commercial banking organizations in the state.2 Nabanks shall not be consummated before the fifteenth tionsBank of Virginia, a subsidiary of NationsBank Corcalendar day following the effective date of this order, poration, Charlotte, North Carolina, is the largest comand the banking and nonbanking transactions shall not mercial banking organization in Virginia, with deposits be consummated later than three months after the effec- of $9.2 billion and a 15.9 percent share of deposits in tive date of this order, unless such period is extended for commercial banks. The four branches of NationsBank of good cause by the Board or by the Federal Reserve Bank Virginia control deposits of $63.4 million, representing of St. Louis, acting pursuant to delegated authority. less than 1 percent of its share of deposits in the state. By order of the Board of Governors, effective Upon consummation of the proposed transaction, Pre- April 6, 1995. mier would become the 11th largest commercial bank in Virginia, controlling $559.3 million of deposits in the Voting for this action: Chairman Greenspan and Governors state. LaWare, Lindsey, Phillips, and Yellen. Absent and not voting: Vice Chairman Blinder and Governor Kelley. Definition of Relevant Banking Market JENNIFER J. JOHNSON Under the Bank Merger Act, the Board may not approve Deputy Secretary of the Board a proposal that would result in a monopoly or substantially lessen competition in any relevant market, unless the Board finds that "the anticompetitive effects of the proposed transaction are clearly outweighed in the pub- ORDERS ISSUED UNDER BANK MERGER ACT lic interest by the probable effect of the transaction in meeting the convenience and needs of the community to Premier Bank be served." 12 U.S.C. § 1828(c)(5). In evaluating the Wytheville, Virginia competitive factors in this case, the Board has carefully considered the comments of a number of individuals Order Approving the Merger of Banks and ("Protestants") who maintain that the proposal would Establishment of Bank Branches substantially lessen competition for banking services in Rural Retreat, Virginia. At the time of the announcement Premier Bank, Wytheville, Virginia ("Premier"), a state of the proposed transaction, Premier and NationsBank of member bank, has applied under section 18(c) of the Virginia were the only two banking organizations in Federal Deposit Insurance Act (12 U.S.C. § 1828(c)) (the Rural Retreat. However, on March 1, 1995, the Federal "Bank Merger Act") to acquire certain assets and as- Reserve Bank of Richmond granted the Bank of Marion, sume certain liabilities of four branches of NationsBank of Virginia, N.A., Richmond, Virginia ("NationsBank of 1. The locations of the branches that Premier proposes to establish are Virginia"). Premier also has applied under section 9 of listed in the Appendix. the Federal Reserve Act (12 U.S.C. § 321) to establish 2. Market deposit data are as of September 30, 1994. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

614 Federal Reserve Bulletin • June 1995 Marion, Virginia, permission to open a branch in Rural market deposits. The Herfindahl-Hirschman Index Retreat. ("HHI") for the market would increase by 121 points to The Board and the courts have found that the relevant 2650.6 banking market for analyzing the competitive effects of a A number of factors indicate that the proposed acquiproposal must reflect commercial and banking realities sition would not have a significantly adverse effect on and must consist of the local area where local customers competition in the Wythe county market. For example, can practicably turn for alternatives.3 The Board has the number of competitors in the market would remain considered all the facts in this case, including comments unchanged. In addition to NationsBank of Virginia, these from Protestants, and concludes that the relevant geo- competitors include a subsidiary of another large intergraphic market in which to evaluate the competitive state banking organization with a market share of effects of this proposal is Wythe County, Virginia (here- 19.2 percent. inafter referred to as the "Wythe County banking As noted above, competitive factor reports were market"). sought from the Attorney General, the OCC, and the Rural Retreat, a town of approximately 972 residents, FDIC, none of which objected to the consummation of is located in Wythe County. Wytheville, with a popula- this proposal or indicated that it would have any signifition of more than 8,000, is the county seat and largest cantly adverse competitive effects. Accordingly, in light town in Wythe County and it is attractive to residents of the moderate increase in concentration, the number of throughout the county for employment and shopping.4 competitors that would remain in the market, and other Rural Retreat is 11 miles southwest of Wytheville. facts of record, the Board concludes that consummation Travel time to Wytheville from Rural Retreat is approxi- of this proposal is not likely to result in any significantly mately 10 minutes, and both Interstate Highway 81 and adverse effect on competition in the Wythe County bank- U.S. Highway 11 connect the two towns. ing market. After review of the data discussed above and the other In addition to the branch in the Wythe County market, facts in this case, including comments from the Protes- Premier also proposes to acquire three branches of Natants, the Board concludes that the record indicates that tionsBank of Virginia, located in the Galax, Virginia, customers in Rural Retreat reasonably can turn to pro- banking market.7 Premier and NationsBank of Virginia viders of banking services throughout the Wythe County do not currently compete in this market. Based on the banking market. Based on all the facts of record, the facts of record, the Board concludes that consummation Board finds that the relevant geographic market in this of this proposal is not likely to result in any significantly case is the Wythe County banking market. adverse effect on competition in the Galax banking market. Effects in the Relevant Banking Markets Convenience and Needs Considerations Premier is the largest of six depository institutions in the Wythe County banking market, controlling deposits of In acting on an application to acquire a depository insti- $102.3 million, representing 34.2 percent of the total tution, the Board must consider the convenience and deposits in depository institutions in the market ("mar- needs of the communities to be served and take into ket deposits").5 NationsBank is the second largest depos- account the records of the relevant depository instituitory institution in the market, controlling $89.1 million tions under the Community Reinvestment Act of deposits, representing 29.8 percent of market depos- (12 U.S.C. § 2901 et seq.) ("CRA"). The CRA requires its. Upon consummation of this proposal, Premier would the federal financial supervisory agencies to encourage control $165.7 million in deposits, representing 40 per- financial institutions to help meet the credit needs of the cent of total market deposits, and NationsBank of Virginia would continue to control 23.9 percent of the 6. Under the revised Department of Justice Merger Guidelines, 49 Federal Register 26,823 (June 29, 1984), a market in which the postmerger HHI is above 1800 is considered to be highly concentrated. In 3. See St. Joseph Valley Bank, 68 Federal Reserve Bulletin 673, 674 such markets, the Justice Department is likely to challenge a merger (1982). that increases the HHI by more than 50 points. The Justice Department 4. Population data are based on 1990 Census Bureau information. has informed the Board that a bank merger or acquisition generally will 5. Market data are as of June 30, 1994. In this context, depository not be challenged (in the absence of other factors indicating anticominstitutions include commercial banks, savings banks, and savings asso- petitive effects) unless the post-merger HHI is at least 1800 and the ciations. Market share data before consummation are based on calcula- merger increases the HHI by more than 200 points. The Justice Departtions in which the deposits of thrift institutions are included at ment has stated that the higher than normal HHI thresholds for screen- 50 percent. The Board previously has indicated that thrift institutions ing bank mergers for anticompetitive effects implicitly recognize the have become, or have the potential to become significant competitors of competitive effect of limited-purpose lenders and other non-depository commercial banks. See WM Bancorp, 76 Federal Reserve Bulletin 788 financial entities. (1990); National City Corporation, 70 Federal Reserve Bulletin 743 7. The Galax banking market consists of the City of Galax, Grayson (1984). County, and most of Carrol County, Virginia. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 615 local communities in which they operate. To accomplish loans in 1993, totalling $3.4 million, and 270 small this end, the CRA requires the appropriate federal super- business loans in 1994, totalling $6.1 million. During the visory authority to "assess the institution's record of first quarter of 1995, Premier approved 14 small busimeeting the credit needs of its entire community, includ- ness loans, totalling $2.4 million. Examiners also indiing low- and moderate-income neighborhoods, consis- cated that the bank participates, with five other local tent with the safe and sound operation of such institu- institutions, in a $300,000 loan pool for facade improvetions," and to take that record into account in its ments for downtown businesses. evaluation of applications.8 The 1994 CRA Examination also indicated that Pre- The Board received comments from a resident of mier originated 450 mortgage loans in 1993 primarily Rural Retreat ("Protestant") alleging, in general, that for the purpose of home purchase, home refinance, or Premier has failed to comply with the CRA, and, in home improvements. In addition, Premier made several particular, that Premier has failed to adequately ascertain loans to local developers for the construction, purchase, and meet the need for small business lending in its or renovation of low- to moderate-income rental houscommunity. ing, including a loan to build two duplexes in Rural The Board has carefully reviewed the CRA perfor- Retreat and a loan to build a duplex in Bland County and mance record of Premier, Protestant's comments, and to refinance a four-unit apartment complex. In addition, Premier's response to these comments, as well as all in 1993, Premier made 2,998 loans of amounts less than other relevant facts of record, in light of the CRA, the $5,000. Board's regulations, and the Statement of the Federal In the 1994 CRA Examination, the examiners noted Financial Supervisory Agencies Regarding the Commu- that Premier's primary ascertainment activities were dinity Reinvestment Act ("Agency CRA Statement").9 rector and officer involvement in community organizations, supplemented by business and social relation- A. Record of CRA Performance ships.12 Examiners also concluded that Premier's marketing efforts were adequate and found that the bank The Agency CRA Statement provides that a CRA exam- routinely advertised loan and deposit products in local ination is an important and often controlling factor in the newspapers, radio and cable television stations that consideration of an institution's CRA record and that reached all segments of its delineated community. these reports will be given great weight in the applications process.10 The Board notes that on August 1, 1994, C. Conclusion Regarding Convenience and Needs Premier received a "satisfactory" rating in its most Factors recent examination for CRA performance by the Federal Reserve Bank of Richmond ("1994 CRA Examina- The Board has carefully considered all the facts of tion"). record, including the comments received, in reviewing the convenience and needs factors under the BHC Act.13 B. Other Aspects of CRA Performance Based on a review of the entire record of this proposal, including the most recent CRA performance examina- The 1994 CRA Examination stated that Premier has adequate policies and procedures supporting nondiscrimination in all lending and credit activities. Furthermore, 12. For example, Premier's directors and officers are involved with applications are solicited from all segments of the delin- the Wythe Industrial Development Authority, Peaks of Virginia Industrial Development Authority, and Wytheville-Wythe-Bland Chamber of eated community, including low- and moderate-income Commerce. In addition, an officer is vice mayor of Wytheville, and a neighborhoods. Moreover, examiners noted that Premier director serves on the Pulaski County Board of Supervisors. 13. The Board also considered a number of comments from Rural is in compliance with the substantive provisions of anti- Retreat residents objecting to this proposal and alleging that local discrimination laws and regulations.11 financial institutions were not given the opportunity to acquire the Examiners noted that Premier is primarily a retail NationsBank branches, that local lending decisions would no longer be made by lending officers who understand the credit needs of Rural lender, although it regularly extends business loans that Retreat residents, that the proposal would create delays in decisions on contribute to the economic growth of the community. loan applications, and that elderly residents would be adversely af- The bank reports that it extended 165 small business fected. The record in this case indicates that NationsBank solicited bids from other financial institutions for the purchase of its Rural Retreat office. With regard to the other allegations raised, Premier has stated that all credit decisions for its customers are made promptly in nearby 8. See 12 U.S.C. § 2903. Wytheville by bank personnel familiar with the financial and economic 9. 54 Federal Register 13,742 (1989). conditions in Wythe County. In addition, the record indicates that 10. Id. at 13,745. Premier ofiFers a variety of banking services to elderly customers, 11. Examiners noted certain technical reporting deficiencies under the including a no-fee checking account and a waiver of the monthly Home Mortgage Disclosure Act and technical violations of the Equal maintenance fee on any non-interest bearing account. In light of all the Credit Opportunity Act. Management has taken corrective action to facts of record, the Board concludes that these comments do not present adverse considerations under the convenience and needs factor. remedy these violations. 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616 Federal Reserve Bulletin • June 1995 tion of Premier, the Board concludes that convenience section 7(d) of the IBA (12 U.S.C. § 3105(d)) to estaband needs considerations, including Premier's efforts to lish a state-licensed branch in New York, New York. A ascertain and meet the small business credit needs of its foreign bank must obtain the approval of the Board to community are consistent with approval of these applica- establish a branch, agency, commercial lending comtions. pany, or representative office in the United States under the Foreign Bank Supervision Enhancement Act of 1991 Other Considerations ("FBSEA"), which amended the IBA. Notice of the application, affording interested persons The Board also concludes that the financial and managean opportunity to submit comments, has been published rial resources and future prospects of Premier are consisin a newspaper of general circulation in New York, New tent with approval of these applications. York (The New York Times, June 30, 1994). The time for Based on the foregoing and all the facts of record, the filing comments has expired and the Board has consid- Board has determined that these applications should be, ered the application and all comments received. and hereby are, approved. The Board's approval of this Bank was the sixth largest bank in Spain in terms of proposal is conditioned on compliance by Premier with assets as of December 31, 1993. Bank offers a wide the commitments made in connection with these applicarange of banking and financial services through numertions. For purposes of this action, the commitments and ous offices and subsidiaries, primarily in Europe and conditions relied on in reaching this decision are both North and South America. In the United States, Bank conditions imposed in writing by the Board and, as such, owns a subsidiary bank, Extebank, Stony Brook, New may be enforced in proceedings under applicable law. York, and maintains an agency in Miami, Florida, and a The acquisition by Premier may not be consummated representative office in New York, New York. Upon before the fifteenth calendar day following the effective establishment of the proposed branch, the New York date of this order, and this proposal may not be consumrepresentative office would be dissolved and its operamated later than three months after the effective date of tions taken over by the branch. Bank is a qualifying this order, unless such period is extended by the Board foreign banking organization as defined in Regulation K. or by the Federal Reserve Bank of Richmond, acting 12 C.F.R. 211.23(b). pursuant to delegated authority. Bank's majority shareholder, Corporation Bancaria de By order of the Board of Governors, effective Espana ("CBE"), also known as "Argentaria," is one of April 24, 1995. the largest financial groups in Spain.1 CBE was created in 1991 by the Spanish government as a "governmental Voting for this action: Chairman Greenspan, Vice Chairman Blinder, and Governors Kelley, LaWare, Phillips, and Yellen. Ab- company" with bank status to serve as a holding comsent and not voting: Governor Lindsey. pany for Bank and several other financial institutions controlled by the government. The Spanish government JENNIFER J. JOHNSON currently owns 50.9 percent of the voting shares of CBE. Deputy Secretary of Board CBE is a qualifying foreign banking organization as Appendix defined in Regulation K. 12 C.F.R. 211.23(b). In order to approve an application by a foreign bank to Branch offices of NationsBank of Virginia to be establish a branch in the United States, the IBA and established by Premier: Regulation K require the Board to determine that the foreign bank engages directly in the business of banking 1. 300 North Main Street, Galax, Virginia outside of the United States and has furnished to the 2. Main Street, Fries, Virginia Board the information it needs to assess adequately the 3. 300 East Main Street, Independence, Virginia application. The Board also must determine that the 4. Main & Buck Streets, Rural Retreat, Virginia foreign bank applicant and any foreign bank parent are subject to comprehensive supervision or regulation on a ORDERS ISSUED UNDER INTERNATIONAL BANKING consolidated basis by its home country supervisor. ACT 12 U.S.C. § 3105(d)(2), 12 C.F.R. 211.24(c)(1). The IBA and Regulation K also permit the Board to take into Banco Exterior de Espana, S.A. account additional standards. 12 U.S.C. § 3105(d)(3)-(4)), Madrid, Spain 12 C.F.R. 211.24(c)(2). Order Approving Establishment of a Branch Banco Exterior de Espana, S.A. ("Bank"), Madrid, 1. As of December 31, 1994, CBE owned 73.2 percent of the shares of Bank and 6.7 percent of Bank's shares were held by Spanish state Spain, a foreign bank within the meaning of the Internaentities; the remainder were publicly held. CBE also has four other tional Banking Act ("IBA"), has applied under principal bank subsidiaries in Spain. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 617 Bank engages directly in the business of banking pears to have the experience and capacity to conduct outside of the United States through its branches in banking operations in the United States through the Europe, South America and elsewhere. Bank also has proposed branch. In addition, Bank has established conprovided the Board with the information necessary to trols and procedures for its U.S. offices to ensure compliassess the application through submissions that address ance with U.S. law. the relevant issues. Spanish risk-based capital standards conform to Euro- Regulation K provides that a foreign bank and any pean Union capital standards which are consistent with parent foreign bank will be considered to be subject to those established under the Basle Accord. CBE's and comprehensive supervision or regulation on a consoli- Bank's capital ratios are in excess of the minimum levels dated basis if the Board determines that the bank is that would be required by the Basle Accord and are supervised and regulated in such a manner that its home considered equivalent to capital that would be required country supervisor receives sufficient information on the of a U.S. banking organization. bank's worldwide operations, including its relationship Finally, with respect to access to information regardto any affiliate, to assess the bank's overall financial ing Bank's operations, the Board has reviewed relevant condition and its compliance with law and regulation.2 provisions of Spanish law and has communicated with 12 C.F.R. 211.24(c)(1). The Board has previously deter- the appropriate government authorities. Bank and CBE mined that other Spanish credit institutions are subject to have committed that they will make available to the comprehensive supervision on a consolidated basis by Board such information on the operations of Bank and their home country supervisor, the Bank of Spain.3 Bank any affiliate of Bank that the Board deems necessary to and CBE have provided information demonstrating that determine and enforce compliance with the IBA, the Bank and CBE are subject to the same regulatory scheme Bank Holding Company Act of 1956, as amended, and applicable to these other institutions.4 In addition, the other applicable federal law. To the extent that the provi- Bank of Spain has stated that in performing its supervision of such information to the Board may be prohibited sory functions, it makes no distinction between private or impeded by law, Bank and CBE have committed to and government-owned banks. Based on all the facts of cooperate with the Board in obtaining any necessary record, the Board concludes that Bank and CBE are consents or waivers that might be required from third subject to comprehensive supervision on a consolidated parties in connection with disclosure of certain necessary basis by their home country supervisor. information. In addition, subject to certain conditions, In considering these applications, the Board also has the Bank of Spain has agreed to cooperate in providing taken into account the additional standards set forth in the Board with information on Bank's and CBE's operasection 7 of the IBA. 12 U.S.C. § 3105(d)(3)-(4). Bank's tions. In light of these commitments and other facts of home country supervisor, the Bank of Spain, has autho- record, and subject to the condition described below, the rized the establishment of the proposed branch in New Board concludes that Bank has provided adequate assur- York. ances of access to any necessary information the Board Managerial and financial resources of Bank are also may request. considered consistent with approval. Bank, which has On the basis of all the facts of record, and subject to numerous branches and subsidiaries outside Spain, ap- the commitments made by Bank and CBE, as well as the terms and conditions set forth in this order, the Board has determined that Bank's application to establish a 2. In assessing this standard, the Board considers, among other branch should be, and hereby is, approved. Should any factors, the extent to which the home country supervisor: (i) Ensures that the bank has adequate procedures for monitoring and restrictions on access to information on the operations or controlling its activities worldwide; activities of Bank and any of its affiliates subsequently (ii) Obtains information on the condition of the bank and its subsidiarinterfere with the Board's ability to determine the safety ies and offices outside the home country through regular examination reports, audit reports, or otherwise; and soundness of Bank's U.S. operations or the compli- (iii) Obtains information on the dealings with and relationship be- ance by Bank or its affiliates with applicable federal tween the bank and its affiliates, both foreign and domestic; statutes, the Board may require termination of any of (iv) Receives from the bank financial reports that are consolidated on a worldwide basis, or comparable information that permits analysis Bank's direct or indirect activities in the United States. of the bank's financial condition on a worldwide consolidated basis; Approval of this application is also specifically condiand (v) Evaluates prudential standards, such as capital adequacy and risk tioned on compliance by Bank and CBE with the comasset exposure, on a worldwide basis. mitments made in connection with this application, and These are indicia of comprehensive, consolidated supervision. No single with the conditions contained in this order.5 The commitfactor is essential, and other elements may inform the Board's determination. 3. See, Banco de Sabadell, S.A., 79 Federal Reserve Bulletin 366 (1993); and Banco Santander, S.A., 79 Federal Reserve Bulletin 622 (1993). 4. CBE qualifies as a bank under Spanish law and is subject to 5. The Board's authority to approve the establishment of the proposed regulation and supervision as such by the Bank of Spain. branch parallels the continuing authority of the New York State Bank- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

618 Federal Reserve Bulletin • June 1995 ments and conditions referred to above are conditions overseas operation is a bank subsidiary in the Cayman imposed in writing by the Board in connection with its Islands. decision, and may be enforced in proceedings under The proposed representative office would engage in 12 U.S.C. § 1818 or 12 U.S.C. § 1847 against Bank and traditional representative functions, including marketing its aflHliates. Bank's services in relation to all types of banking busi- By order of the Board of Governors, effective ness. The proposed representative office would not ac- April 5, 1995. cept any deposits or make any loans, make any business decision for the account of Bank, or otherwise transact Voting for this action: Chairman Greenspan and Governors any banking business. LaWare, Lindsey, Phillips, and Yellen. Absent and not voting: Vice In acting on an application to establish a representa- Chairman Blinder and Governor Kelley. tive office, the IBA and Regulation K provide that the Board shall take into account whether the foreign bank JENNIFER J. JOHNSON engages directly in the business of banking outside of Deputy Secretary of the Board the United States and has furnished the Board the information it needs to assess adequately the application. The Banco Frances del Rio de la Plata S.A. Board also shall take into account whether the foreign Buenos Aires, Argentina bank and any foreign bank parent is subject to comprehensive supervision or regulation on a consolidated basis Order Approving Establishment of a Representative by its home country supervisor (12 U.S.C. § 3105(d)(2); Office 12 C.F.R. 211.24). The Board may also take into account additional standards as set forth in the IBA (12 U.S.C. § 3105(d)(3)-(4)) and Regulation K (12 C.F.R. Banco Frances del Rio de la Plata S.A. ("Bank"), Bue- 211.24(c)). nos Aires, Argentina, a foreign bank within the meaning The Board has stated previously that the standards that of the International Banking Act ("IBA"), has applied apply to the establishment of a branch or agency need under section 10(a) of the IBA (12 U.S.C. § 3107(a)) to not in every case apply to the establishment of a repreestablish a representative office in New York, New York. sentative office because representative offices do not The Foreign Bank Supervision Enhancement Act of engage in a banking business and cannot take deposits or 1991 ("FBSEA"), which amended the IBA, provides make loans.2 In evaluating an application to establish a that a foreign bank must obtain the approval of the representative office under the IBA and Regulation K, Board to establish a representative office in the United the Board will take into account the standards that apply States. to establishment of branches and agencies, subject to the Notice of the application, affording interested persons following considerations. With respect to supervision by an opportunity to submit comments, has been published home country authorities, a foreign bank that proposes to in a newspaper of general circulation in New York, New establish a representative office must be subject to a York (New York Newsday, July 11, 1994). The time for significant degree of supervision by its home country filing comments has expired and the Board has considsupervisor.3 A foreign bank's financial and managerial ered the application and all comments received. resources will be reviewed to determine whether its Bank is the third largest private commercial bank in financial condition and performance demonstrate that it Argentina and has total consolidated assets of approximately $2.3 billion.1 An Argentinian holding company is capable of complying with applicable laws and has an operating record that would be consistent with the estabowns approximately 30.9 percent of Bank's shares, and lishment of a representative office in the United States. is the only entity that holds more than 10 percent of Finally, all foreign banks, whether operating through Bank's shares. The remainder of the stock of Bank is branches, agencies or representative offices, will be rewidely held. Bank operates through 65 branches in Arquired to provide adequate assurances of access to inforgentina, and has four domestic nonbank subsidiaries mation on the operations of bank and its affiliates necesengaged in stock brokerage, venture capital, insurance sary to determine compliance with U.S. laws. brokerage and pension fund administration. Bank's only In this case, with respect to the issue of supervision by home country authorities, the Board has considered the following information. The Central Bank of the Repubing Department to license offices of a foreign bank. The Board's lic of Argentina ("Central Bank") is the bank superviapproval of this application does not supplant the authority of the State of New York, and its agent, the New York State Banking Department, to license the proposed branch of Bank in accordance with any terms or conditions that the New York State Banking Department may impose. 2. See 58 Federal Register 6348, 6351 (1993). 3. See Citizens National Bank, 79 Federal Reserve Bulletin 805 1. Data are as of December 31, 1994, unless otherwise noted. (1993). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 619 sory authority in Argentina and, as such, is the home The Board has also found that Bank engages directly country supervisor of Bank. The Central Bank has autho- in the business of banking outside of the United States rized Bank to establish the proposed representative of- through its commercial banking operations in Argentina. fice. The Central Bank performs its supervisory function Bank has provided the Board with the information necesthrough the Superintendency of Financial Entities. The sary to assess the application through submissions that Central Bank is authorized to approve and revoke bank address the relevant issues. licenses, set capital and liquidity requirements, approve The Board has also taken into account the additional the establishment of domestic or overseas offices or standards set forth in section 7 of the IBA and Regulasubsidiaries, and approve new banking activities. The tion K (see 12 U.S.C. § 3105(d)(3)-(4); 12 C.F.R. Central Bank is also responsible for enforcement of laws 211.24(c)(2)). As noted above, the Central Bank has regulating banking activities. authorized Bank to establish the proposed representative In approving an application by another Argentine office. In addition, the Central Bank may share informabank, the Board noted that the Central Bank currently is tion on Bank's operations with other supervisors, includin the process of making significant changes and en- ing the Board. hancements to its system of bank supervision.4 Under With respect to the financial and managerial resources the enhanced system, the Central Bank monitors the of Bank, taking into consideration Bank's record of operations and financial condition of Bank through on- operations in its home country, its overall financial resite inspections and the review of required regulatory sources, and its standing with its home country supervireports and external audit reports. Bank is subject to sors, the Board has also determined that financial and comprehensive annual inspections. Comprehensive in- managerial factors are consistent with approval of the spections include a review of internal controls, credit proposed representative office. Bank appears to have the policy, portfolio risk, capital and reserve requirements, experience and capacity to support the proposed repretransactions with related institutions, and foreign ex- sentative office and has also established controls and change operations and foreign currency transactions. procedures for the proposed representative office to en- Comprehensive inspections also include an evaluation of sure compliance with U.S. law. management's ability to operate the bank in a safe and Finally, with respect to access to information about sound manner. Bank's operations, the Board has reviewed the relevant Off-site monitoring of Bank by the Central Bank is provisions of law in Argentina and has communicated carried out through the review of required financial with appropriate governmental authorities regarding reports and external audit reports that provide informa- access to information. Bank and its ultimate parent tion on Bank's financial condition and compliance with have each committed to make available to the Board law and regulation. Bank files with the Central Bank such information on the operations of Bank and its monthly, quarterly, and annual reports that are prepared affiliates that the Board deems necessary to determine on a consolidated basis and that address, among other and enforce compliance with the IBA, the Bank Holding things, asset balances, earnings performance, asset and Company Act of 1956, as amended, and other applicable liability structure, credit risk of large borrowers, and Federal law. To the extent that the provision of such financial transactions with affiliates. The Central Bank information may be prohibited by law, Bank and its also imposes certain investment and lending limits on ultimate parent have committed to cooperate with the Bank in its dealings with affiliates, senior management Board in obtaining any necessary consents or waivers and directors. Bank is also required by the Central Bank that might be required from third parties in connection to establish adequate internal control procedures in order with the disclosure of certain necessary information. In to effectively monitor and control its worldwide activi- light of these commitments and other facts of record, and ties. Bank conducts periodic internal audits of its domes- subject to the condition described below, the Board tic and foreign operations and has implemented policies concludes that Bank has provided adequate assurances and procedures to safeguard against money laundering of access to any necessary information the Board and other illicit activities. may request. Based on all the facts of record, which include the On the basis of all the facts of record, and subject to information described above, the Board concludes that the commitments made by Bank and its ultimate parent, factors relating to the supervision of Bank by its home as well as the terms and conditions set forth in this order, country supervisors are consistent with approval of the the Board has determined that Bank's application to proposed representative office. establish a representative office should be, and hereby is, approved. If any restrictions on access to information on the operations or activities of Bank and any of its affiliates subsequently interfere with the Board's ability to 4. See Banco de Galicia y Buenos Aires, 80 Federal Reserve Bulletin 846 (1994). determine the compliance by Bank or its affiliates with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

620 Federal Reserve Bulletin • June 1995 applicable federal statutes, the Board may require termi- Bank operates 56 branches throughout Taiwan, and nation of any of Bank's direct or indirect activities in the one subsidiary, Datum Real Estate Management Com- United States. Approval of this application is also specif- pany, Ltd. ("Datum"), Taipei, Taiwan.1 Bank's existing ically conditioned on compliance by Bank and its ulti- branch in Seattle, Washington, was established in April mate parent with the commitments made in connection 1991. In addition, Bank operates an offshore banking with this application, and with the conditions in this unit in Taiwan. order.5 The commitments and conditions referred to Bank's primary purpose for establishing the branch is above are conditions imposed in writing by the Board in to obtain better access to the California banking market, connection with its decision, and may be enforced in and to facilitate trade between the United States and proceedings under 12 U.S.C. § 1818 against Bank and its Taiwan. As a limited branch, the proposed branch would affiliates. be prohibited from accepting deposits from sources other By order of the Board of Governors, effective than those permitted pursuant to section 5 of the IBA and April 24, 1995. section 25A of the Federal Reserve Act.2 The activities of the proposed branch also would include making loans, Voting for this action: Chairman Greenspan, Vice Chairman issuing and confirming letters of credit, foreign ex- Blinder, and Governors Kelley, LaWare, Phillips, and Yellen. Ab- change trading, international trade finance and wire sent and not voting: Governor Lindsey. transfers. Bank does not engage directly or indirectly in any nonbanking activities in the United States, and JENNIFER J. JOHNSON would be a qualifying foreign banking organization Deputy Secretary of the Board within the meaning of Regulation K after establishing the proposed branch. 12 C.F.R. 211.23(b). The Farmers Bank of China Bank has received approval to establish the proposed Taipei, Taiwan branch from the Ministry, conditioned upon approval of the proposed branch by the relevant authorities in the United States. Bank has applied to the California State Order Approving Establishment of a Branch Banking Department for approval to establish the proposed branch. The Farmers Bank of China ("Bank"), Taipei, Taiwan, a In order to approve an application by a foreign bank to foreign bank within the meaning of the International establish a branch in the United States, the IBA and Banking Act ("IBA"), has applied under section 7(d) of Regulation K require the Board to determine that the the IBA (12 U.S.C. § 3105(d)) to establish a state- foreign bank applicant engages directly in the business licensed limited branch in Los Angeles, California. The of banking outside of the United States, and has fur- Foreign Bank Supervision Enhancement Act of 1991 nished to the Board the information it needs to ade- ("FBSEA"), which amended the IBA, provides that a quately assess the application. The Board must also foreign bank must obtain the approval of the Board to determine that the foreign bank is subject to comprehenestablish a branch in the United States. sive supervision or regulation on a consolidated basis by Notice of the application, affording interested persons its home country supervisor (12 U.S.C. § 3105(d)(2)). an opportunity to submit comments, has been published The Board may also take into account additional stanin a newspaper of general circulation in Los Angeles, dards as set forth in the IBA (12 U.S.C. § 3105(d)(3)-(4)) California (Los Angeles Times, January 8, 1995). The and Regulation K (12 C.F.R. 211.24(c)). time for filing comments has expired and all comments Bank engages directly in the business of banking have been considered. outside of the United States through its extensive com- Bank, with assets of $13.7 billion on December 31, mercial banking operations in Taiwan. Bank also has 1994, is the 11th largest bank in Taiwan. The Taiwanese provided the Board with the information necessary to central government through its agency, the Ministry of assess the application through submissions that address Finance ("Ministry"), owns almost 60 percent of Bank's the relevant issues. shares. The remaining shares of Bank are widely held by Regulation K provides that a foreign bank will be the general public. considered to be subject to comprehensive supervision 5. The Board's authority to approve the establishment of the proposed representative office parallels the continuing authority of the State of 1. Datum, with assets of $199 million, provides construction manage- New York to license offices of a foreign bank. The Board's approval of ment and oversight services. this application does not supplant the authority of the State of New York 2. Bank is proposing to open a limited branch under section 5 of the and its agent, the New York State Banking Department, to license the IBA because it already operates a full-service branch in Seattle, Washproposed representative office of Bank in accordance with any terms or ington, and has designated Washington as its home state. conditions that the State of New York may impose. 12 U.S.C. § 3103. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 621 or regulation on a consolidated basis if the Board deter- The Board has also taken into account the additional mines that the bank is supervised and regulated in such a standards set forth in section 7 of the IBA (see 12 U.S.C. manner that its home country supervisor receives suffi- § 3105(d)(3)-(4); 12 C.F.R. 211.24(c)(2)). Bank has procient information on the foreign bank's worldwide oper- vided the Board with the information necessary to assess ations, including the relationship of the foreign bank to the application through submissions that address the any affiliate, to assess the overall financial condition of relevant issues. As noted above, Bank has received the the foreign bank and its compliance with law and regula- consent of its home country authorities to establish the tion (12 C.F.R. 211.24(c)(1)).3 In making its determina- proposed state-licensed branch. In addition, the Ministry tion under this standard, the Board has considered the may share information on Bank's operations with other following information. supervisors, including the Board. Bank is supervised and regulated by the Ministry and Bank must comply with the minimum capital stanthe Taiwanese Central Bank ("Central Bank"), which dards of the Basle Accord, as implemented by Taiwan. share responsibility for the supervision of Taiwanese Bank's capital exceeds these minimum standards and banks. The Banking Law of Taiwan grants the Ministry can be considered equivalent to capital that would be overall authority for the regulation and supervision of required of a U.S. banking organization. Managerial and Taiwanese banks, including commercial banks, such as other financial resources of Bank are also considered Bank.4 The Ministry has delegated the authority to the consistent with approval, and Bank appears to have the Central Bank to act as the primary examiner of banks in experience and capacity to support the proposed branch. Taiwan, in which capacity the Central Bank conducts Bank has established controls and procedures for the mandatory annual examinations.5 proposed branch in order to ensure compliance with U.S. The Board has previously determined, in connection law, as well as controls and procedures for its worldwide with applications involving other Taiwanese banks, in- operations generally. cluding Chiao Tung Bank, Taipei, Taiwan, that these Bank has committed that it will make available to the banks were subject to home country supervision on a Board such information on the operations of Bank and consolidated basis.6 In this case, Bank is supervised by any affiliate of Bank that the Board deems necessary to the Ministry and the Central Bank on the same terms and determine and enforce compliance with the IBA, the conditions as Chiao Tung Bank. Based on all the facts of Bank Holding Company Act of 1956, as amended, and record, the Board has determined that Bank is subject to other applicable federal law. To the extent that the provicomprehensive supervision and regulation on a consoli- sion of such information is prohibited or impeded by dated basis by its home country supervisors. law, Bank has committed to cooperate with the Board to obtain any necessary consents or waivers that might be required from third parties in connection with disclosure of certain information. In addition, subject to certain conditions, the Ministry and the Central Bank may share 3. In assessing this standard, the Board considers, among other information on Bank's operations with other supervifactors, the extent to which the home country supervisors: (i) Ensure that the bank has adequate procedures for monitoring and sors, including the Board. In light of these commitments controlling its activities worldwide; and other facts of record, and subject to the condition (ii) Obtain information on the condition of the bank and its subsidiardescribed below, the Board concludes that Bank has ies and offices through regular examination reports, audit reports, or otherwise; provided adequate assurances of access to any necessary (iii) Obtain information on the dealings with and relationship be- information the Board may request. tween the bank and its affiliates, both foreign and domestic; (iv) Receive from the bank financial reports that are consolidated on a On the basis of all the facts of record, and subject to worldwide basis, or comparable information that permits analysis of the commitments made by Bank, as well as the terms the bank's financial condition on a worldwide consolidated basis; and conditions set forth in this order, the Board has (v) Evaluate prudential standards, such as capital adequacy and risk asset exposure, on a worldwide basis. determined that Bank's application to establish a state- These are indicia of comprehensive, consolidated supervision. No single licensed limited branch should be, and hereby is, apfactor is essential and other elements may inform the Board's determination. proved. Should any restrictions on access to information 4. This authority permits the Ministry to, among other things, issue licenses, limit activities and expansion, conduct examinations, set mini- on the operations or activities of Bank and its affiliates mum capital and liquidity ratios, limit credit extensions, restrict director subsequently interfere with the Board's ability to deterinterlocks, define qualifications for management, and take enforcement actions. mine the safety and soundness of Bank's U.S. operations 5. Bank receives additional oversight by the Ministry of Audit, an or the compliance by Bank or its affiliates with applicaauditor of government agencies and government-owned enterprises. ble federal statutes, the Board may require termination This oversight is secondary to supervision by the Ministry and the Central Bank. of any of the Bank's direct or indirect activities in the 6. See Chiao Tung Bank, 79 Federal Reserve Bulletin 543 (1993). See United States. Approval of this application is also specifalso Taipei Bank, 79 Federal Reserve Bulletin 143 (1993); Bank of ically conditioned on Bank's compliance with the com- Taiwan, 79 Federal Reserve Bulletin 541 (1993); and United World Chinese Commercial Bank, 79 Federal Reserve Bulletin 146 (1993). mitments made in connection with this application, and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

622 Federal Reserve Bulletin • June 1995 with the conditions in this order.7 The commitments and may be enforced in proceedings under 12 U.S.C. § 1818 conditions referred to above are conditions imposed in or 12 U.S.C. § 1847 against Bank, its office and its affiliwriting by the Board in connection with its decision, and ates. By order of the Board of Governors, effective April 24, 1995. 7. The Board's authority to approve the establishment of the proposed Voting for this action: Chairman Greenspan, Vice Chairman branch parallels the continuing authority of the State of California to Blinder, and Governors Kelley, LaWare, Phillips, and Yellen. Ablicense offices of a foreign bank. The Board's approval of this applica- sent and not voting: Governor Lindsey. tion does not supplant the authority of the State of California, and its agent, the California State Banking Department, to license the proposed branch of Bank in accordance with any terms or conditions that the JENNIFER J. JOHNSON California State Banking Department may impose. Deputy Secretary of the Board APPLICATIONS APPROVED UNDER BANK HOLDING COMPANY 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. Section 3 Applicant(s) Bank(s) Reserve Bank Effective Date Brill Bancshares, Inc., Brill State Bank, Minneapolis April 12, 1995 Brill, Wisconsin Brill, Wisconsin CFX Corporation, Orange Savings Bank, Boston April 4, 1995 Keene, New Hampshire Orange, Massachusetts CFX Interim Trust Company, Orange, Massachusetts Chambers Bancshares, Inc., Bank of Atkins, St. Louis April 4, 1995 Danville, Arkansas Atkins, Arkansas Commerce Bancshares, Inc., Chillicothe State Bancorp, Inc. Kansas City April 12, 1995 Kansas City, Missouri Chillicothe, Illinois CBI-Illinois, Inc., Kansas City, Missouri Community Bancshares, Inc. Seneca Management Company, Kansas City April 14, 1995 Employee Stock Ownership Neosho, Missouri Plan, Neosho, Missouri Community Group, Inc., Etowah Bancing Company, Atlanta March 30, 1995 Chattanooga, Tennessee Etowah, Tennessee CRB Financial Corp., Camino Real Bancshares, Inc., Dallas March 31, 1995 San Antonio, Texas San Antonio, Texas Camino Real Delaware, Inc., Wilmington, Delaware Camino Real Bank, N.A., Eagle Pass, Texas Danny Management, Inc., DG Partnership, Ltd., Dallas April 19, 1995 Muleshoe, Texas Muleshoe, Texas Muleshoe Bancshares, Inc., Muleshoe, Texas First Bank of Muleshoe, Muleshoe, Texas Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 623 Section 3—Continued Applicant(s) Bank(s) Reserve Bank Effective Date ESB Bancorp, Inc., Enfield Savings Bank, Inc., SSB, Richmond April 10, 1995 Enfield, North Carolina Enfield, North Carolina FBD Holding Company, First Bank of Dalton, Atlanta April 18, 1995 Dalton, Georgia Dalton, Georgia FCFT, Inc., Bank of Mount Hope, Inc. Richmond March 29, 1995 Princeton, West Virginia Mount Hope, West Virginia First Community Bank Group, Citizens State Bank of Barrett, Minneapolis April 19, 1995 Inc., Barrett, Minnesota Hopkins, Minnesota Todd County Agency, Inc., Hopkins, Minnesota First Interstate BancSystem of First Park County Bancshares, Inc., Minneapolis April 11, 1995 Montana, Inc., Livingston, Montana Billings, Montana Golden Bancshares, Inc., Maurice L. Quinn Properties, Inc., St. Louis April 5, 1995 Golden, Illinois Northbrook, Illinois Greater Rome Bancshares, Inc., Greater Rome Bank, Atlanta March 29, 1995 Rome, Georgia Rome, Georgia Habersham Bancorp Security Bancorp, Inc., Atlanta April 19, 1995 Cornelia, Georgia Canton, Georgia Hibernia Corporation, Progressive Bancorporation, Inc., Atlanta March 31, 1995 New Orleans, Louisiana Houma, Louisiana Hibernia Corporation, STABA Bancshares, Inc., Atlanta April 6, 1995 New Orleans, Louisiana Donaldsonville, Louisiana Jacksonville Bancorp, M.H.C., Jacksonville Savings Bank, St. Louis March 31, 1995 Jacksonville, Illinois Jacksonville, Illinois Lima Bancshares, Inc., Wemple State Bank, St. Louis March 29, 1995 Lima, Illinois Waverly, Illinois Mercantile Bancorporation Inc., TC Bankshares, Inc., St. Louis April 10, 1995 St. Louis, Missouri North Little Rock, Arkansas Mercantile Bancorporation Inc. of Arkansas, St. Louis, Missouri Norwest Corporation, Norwest Bank Grand Forks, N.A., Minneapolis April 12, 1995 Minneapolis, Minnesota Grand Forks, North Dakota Old Second Bancorp, Inc., Bank of Sugar Grove, Chicago April 13, 1995 Aurora, Illinois Sugar Grove, Illinois Overland Bancorp., Inc., Bank of Belton, Kansas City March 20, 1995 Belton, Missouri Belton, Missouri Stine Family Partnership, United Nebraska Financial Company, Kansas City April 11, 1995 Grand Island, Nebraska Grand Island, Nebraska Turner Bancshares, Inc., HDJ Turner Company, d/b/a Potosi St. Louis April 3, 1995 Belgrade, Missouri Abstract Co., Potosi, Missouri Valrico Bancorp, Inc., Valrico State Bank, Atlanta April 14, 1995 Valrico, Florida Valrico, Florida Westamerica Bancorporation, North Bay Bancorp, San Francisco April 18, 1995 San Rafael, California Novato, California Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

624 Federal Reserve Bulletin • June 1995 Section 4 Applicant(s) Nonbanking Activity/Company Reserve Bank Effective Date Barnett Banks, Inc., Barnett Dealer Financial Services, Inc., Atlanta April 10, 1995 Jacksonville, Florida Jacksonville, Florida Capital Bancorporation, Inc., Home Federal Savings and Loan St. Louis April 14, 1995 Cape Girardeau, Missouri Association, Jonesboro, Arkansas Cass Commercial Corporation, To engage de novo in acquiring and St. Louis March 31, 1995 St. Louis, Missouri holding credit card receivables Chemical Banking Corporation, Chemical Mellon Shareholder Services, New York April 18, 1995 New York, New York Ridgefield Park, New Jersey Deutsche Bank AG, ITT Business Services Corporation, New York April 18, 1995 Frankfurt, Federal Republic of Clayton, Missouri, Germany ITT Commercial Finance Corporation, Hato Rey, Puerto Rico First Maryland Bancorp, To engage de novo in the activity of Richmond April 17, 1995 Baltimore, Maryland community development, by making Allied Irish Banks, p.l.c., investments in limited partnerships Dublin, Ireland which would acquire, construct, or rehabilitate low- and moderate-income housing Mellon Bank Corporation, Chemical Mellon Shareholder Services, Cleveland April 18, 1995 Pittsburgh, Pennsylvania Ridgefield Park, New Jersey Mercantile Bancorporation Inc., St. Louis Business Development Fund, St. Louis April 7, 1995 St. Louis, Missouri St. Louis, Missouri National City Bancshares, Inc., United Financial Bancorp, Inc., St. Louis April 13, 1995 Evansville, Indiana Vincennes, Indiana NBD Bancorp, Inc., Deerbank Corporation, Chicago April 5, 1995 Detroit, Michigan Deerfield, Illinois NBD Illinois, Inc., Deerfield Federal Savings and Loan Mount Prospect, Illinois Association, Deerfield, Illinois Northern Illinois Financial Service Corporation, Deerfield, Illinois Norwest Corporation, First National Bank of Parker, Minneapolis March 31, 1995 Minneapolis, Minnesota Parker, Colorado Professional Bancorp, To engage de novo in the making, San Francisco April 18, 1995 Santa Monica, California acquiring or servicing of loans or other extensions of credit Regions Financial Corporation, Fidelity Federal Savings Bank, Atlanta March 17, 1995 Birmingham, Alabama Dalton, Georgia Sidell Bancorp, Inc., To engage de novo in the nonbanking Chicago March 29, 1995 Sidell, Illinois activity of making and servicing loans Swiss Bank Corporation, Brinson Holdings, Inc., New York March 28, 1995 Basel, Switzerland Chicago, Illinois Union Bancorporation, To engage de novo in making and Chicago April 7, 1995 Defiance, Iowa servicing loans Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 625 Sections 3 and 4 Applicant(s) Nonbanking Activity/Company Reserve Bank Effective Date First National Bancorp, FF Bancorp, Inc., Atlanta April 13, 1995 Gainesville, Georgia New Smyrna Beach, Florida Key Bancshares, Inc., Tampa, Florida The Key Bank of Florida, Tampa, Florida First Federal Savings Bank of New Smyrna, New Smyrna Beach, Florida First Federal Savings Bank of Citrus County, Inverness, Florida First State Bancorp of Monticello, First State Bancorp of Monticello, Chicago March 27, 1995 Inc. Employee Stock Option Monticello, Illinois Plan, Monticello, Illinois 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. Applicant(s) Bank(s) Reserve Bank Effective Date Community Bank and Trust, State Bank of Seneca, Kansas City April 14, 1995 Neosho, Missouri Seneca, Missouri Fifth Third Bank of Central Fifth Third Bank of Southeastern Chicago March 30, 1995 Indiana, Indiana, Indianapolis, Indiana Greensburg, Indiana Merchants Bank, Bank of Edwards, Atlanta March 31, 1995 Vicksburg, Mississippi Edwards, Mississippi Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

626 Federal Reserve Bulletin • June 1995 In re Subpoena Duces Tecum, No. 94-MS-214 (D. D.C., PENDING CASES INVOLVING THE BOARD OF filed June 27, 1994). Subpoena enforcement case in GOVERNORS which the plaintiff in a securities fraud class action seeks This list of pending cases does not include suits examination reports and internal Board memos. On Febagainst the Federal Reserve Banks in which the Board ruary 1, 1995, the court granted the plaintiff's motion to of Governors is not named a party. compel, subject to the Board's right to claim privilege with respect to the documents sought. Money Station, Inc. v. Board of Governors, No. 95-1182 Beckman v. Greenspan, No. CV 94-41-BCG-RWA (D.C. Cir., filed March 30, 1995). Petition for review of a (D. Mont., filed April 13, 1994). Action against Board Board order dated March 1, 1995, approving notices by and others seeking damages for alleged violations of Bank One Corporation, Columbus, Ohio; CoreStates Ficonstitutional and common law rights. The Board's monancial Corp., Philadelphia, Pennsylvania; PNC Bank tion to dismiss was filed May 19, 1994. Corp., Pittsburgh, Pennsylvania; and KeyCorp, Cleveland, Ohio, to acquire certain data processing assets of Board of Governors v. Ghaith. R. Pharaon, No. 91-CIV- National City Corporation, Cleveland, Ohio, through a 6250 (S.D. New York, filed September 17, 1991). Action joint venture subsidiary. to freeze assets of individual pending administrative adju- Jones v. Board of Governors, No. 95-1142 (D.C. Cir., filed dication of civil money penalty assessment by the Board. March 3, 1995). Petition for review of a Board order On September 17, 1991, the court issued an order tempodated February 2, 1995, approving the applications by rarily restraining the transfer or disposition of the individ- First Commerce Corporation, New Orleans, Louisiana, to ual's assets. merge with City Bancorp, Inc., New Iberia, Louisiana, and First Bankshares, Inc., Slidell, Louisiana. Petitioner filed a motion for injunctive relief on April 3, 1995. On April 17, 1995, the Board filed its opposition to the FINAL ENFORCEMENT ORDERS ISSUED BY THE BOARD motion. OF GOVERNORS In re Subpoena Duces Tecum, No. 95-5034 (D.C. Cir., filed Dane B. Britton January 26, 1995). Appeal of partial denial of plaintiff's Ellsworth, Kansas motion to compel production of examination and other supervisory material in connection with a shareholder The Federal Reserve Board announced on April 5, 1995, derivative action against a bank holding company. the issuance of an Order of Prohibition against Dane B. Kuntz v. Board of Governors, No. 95-3044 (6th Cir., filed Britton, a former officer and institution-affiliated party of January 12, 1995). Petition for review of a Board order the Citizens State Bank and Trust Company, and Britton dated December 19, 1994, approving an application by Bancshares, Inc., Ellsworth, Kansas. KeyCorp, Cleveland, Ohio, to acquire BANKVERMONT Corp., Burlington, Vermont. On February 10, 1995, the Steven J. Hirsch Board filed its motion to dismiss. Roberts, Wisconsin Zemel v. Board of Governors, No. 95-5007 (D.C. Cir., filed December 30, 1994). Appeal of district court's dismissal The Federal Reserve Board announced on April 5, 1995, of Age Discrimination in Employment Act case. the issuance of an Order of Assessment of a Civil Money In re Subpoena Duces Tecum, Misc. No. 95-06 (D.D.C., Penalty against Steven J. Hirsch, the president and a filed January 6, 1995). Action to enforce subpoena seekdirector of Investors Bancorporation, Inc., Roberts, Wising pre-decisional supervisory documents sought in conconsin. nection with an action by Bank of New England Corporation's trustee in bankruptcy against the Federal Deposit Insurance Corporation. The Board filed its opposition on January 20, 1995. WRITTEN AGREEMENTS APPROVED BY FEDERAL Cavallari v. Board of Governors, No. 94-4183 (2d Cir., RESERVE BANKS filed October 17, 1994). Petition for review of Board order of prohibition against a former outside counsel to a Southern Security Bank Corporation, Inc. national bank (80 Federal Reserve Bulletin 1046 (1994)). Deerfield Beach, Florida The case was consolidated with a petition for review of orders of the Comptroller of the Currency imposing a The Federal Reserve Board announced on April 19, civil money penalty and cease and desist order against 1995, the execution of a Written Agreement between the petitioner (Cavallari v. OCC, No. 94-4151). Oral argu- Federal Reserve Bank of Atlanta and Southern Security ment was heard on March 23, 1995. Bank Corporation, Inc., Deerfield Beach, Florida. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

627 Membership of the Board of Governors of the Federal Reserve System, 1913-95 APPOINTIVE MEMBERS1 Federal Reserve Date of initial Other dates and information relating Name District oath of office to membership2 Charles S. Hamlin Boston AAuugg.. 1100,, 11991144 Reappointed in 1916 and 1926. Served until Feb. 3, 1936.3 Paul M. Warburg New York do Term expired Aug. 9, 1918. Frederic A. Delano Chicago do Resigned July 21, 1918. W.P.G. Harding Atlanta do Term expired Aug. 9, 1922. Adolph C. Miller San Francisco do Reappointed in 1924. Reappointed in 1934 from the Richmond District. Served until Feb. 3, 1936.3 Albert Strauss New York ...Oct. 26, 1918 Resigned Mar. 15, 1920. Henry A. Moehlenpah Chicago ...Nov. 10, 1919 Term expired Aug. 9, 1920. Edmund Piatt New York ...June 8, 1920 Reappointed in 1928. Resigned Sept. 14, 1930. David C. Wills Cleveland ...Sept. 29, 1920 Term expired Mar. 4, 1921. John R. Mitchell Minneapolis ...May 12, 1921 Resigned May 12, 1923. Milo D. Campbell Chicago ...Mar. 14, 1923 Died Mar. 22, 1923. Daniel R. Crissinger Cleveland ...May 1, 1923 Resigned Sept. 15, 1927. George R. James St. Louis ...May 14, 1923 Reappointed in 1931. Served until Feb. 3, 1936.4 Edward H. Cunningham.... Chicago do Died Nov. 28, 1930. Roy A. Young Minneapolis ...Oct. 4, 1927 Resigned Aug. 31, 1930. Eugene Meyer ...Sept. 16, 1930 Resigned May 10, 1933. Wayland W. Magee Kansas City ...May 18, 1931 Term expired Jan. 24, 1933. Eugene R. Black Atlanta ...May 19, 1933 Resigned Aug. 15, 1934. M.S. Szymczak Chicago ...June 14, 1933 Reappointed in 1936 and 1948. Resigned May 31, 1961. J.J. Thomas Kansas City do Served until Feb. 10, 1936.3 Marriner S. Eccles ,....San Francisco ...Nov. 15, 1934 Reappointed in 1936, 1940, and 1944. Resigned July 14, 1951. Joseph A. Broderick New York ...Feb. 3, 1936 Resigned Sept. 30, 1937. John K. McKee ....Cleveland do Served until Apr. 4, 1946.3 Ronald Ransom ....Atlanta do Reappointed in 1942. Died Dec. 2, 1947. Ralph W. Morrison Dallas ...Feb. 10, 1936 Resigned July 9, 1936. Chester C. Davis ....Richmond ...June 25, 1936 Reappointed in 1940. Resigned Apr. 15, 1941. Ernest G. Draper ....New York ...Mar. 30, 1938 Served until Sept. 1, 1950.3 Rudolph M. Evans ....Richmond ...Mar. 14, 1942 Served until Aug. 13, 1954.3 James K. Vardaman, Jr. .... ....St. Louis ...Apr. 4, 1946 Resigned Nov. 30, 1958. Lawrence Clayton ....Boston ...Feb. 14, 1947 Died Dec. 4, 1949. Thomas B. McCabe ....Philadelphia ...Apr. 15, 1948 Resigned Mar. 31, 1951. Edward L. Norton ....Atlanta ...Sept. 1, 1950 Resigned Jan. 31, 1952. Oliver S. Powell ....Minneapolis do Resigned June 30, 1952. Wm. McC. Martin, Jr. ....New York ...April 2, 1951 Reappointed in 1956. Term expired Jan. 31, 1970. A.L. Mills, Jr. ....San Francisco ...Feb. 18, 1952 Reappointed in 1958. Resigned Feb. 28, 1965. J.L. Robertson ....Kansas City do Reappointed in 1964. Resigned Apr. 30, 1973. C. Canby Balderston ....Philadelphia ...Aug. 12, 1954 Served through Feb. 28, 1966. Paul E. Miller ....Minneapolis ...Aug. 13, 1954 Died Oct. 21, 1954. Chas. N. Shepardson ....Dallas ...Mar. 17, 1955 Retired Apr. 30, 1967. GG..HH.. KKiinngg,, JJrr ....Atlanta ...Mar. 25, 1959 Reappointed in 1960. Resigned Sept. 18, 1963. George W. Mitchell ....Chicago ...Aug. 31, 1961 Reappointed in 1962. Served until Feb. 13, 1976.3 J. Dewey Daane ....Richmond ...Nov. 29, 1963 Served until Mar. 8, 1974.3 Sherman J. Maisel ....San Francisco ...Apr. 30, 1965 Served through May 31, 1972. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

628 Federal Reserve Bulletin • June 1995 Federal Reserve Date of initial Other dates and information relating Name District oath of office to membership2 Andrew F. Brimmer Philadelphia Mar. 9, 1966 Resigned Aug. 31, 1974. William W. Sherrill Dallas May 1, 1967 Reappointed in 1968. Resigned Nov. 15, 1971. Arthur F. Burns New York Jan. 31, 1970 Term began Feb. 1, 1970. Resigned Mar. 31, 1978. John E. Sheehan St. Louis Jan. 4, 1972 Resigned June 1, 1975. Jeffrey M. Bucher San Francisco June 5, 1972 Resigned Jan. 2, 1976. Robert C. Holland Kansas City June 11, 1973 Resigned May 15, 1976. Henry C. Wallich Boston Mar. 8, 1974 Resigned Dec. 15, 1986. Philip E. Coldwell Dallas Oct. 29, 1974 Served through Feb. 29, 1980. Philip C. Jackson, Jr Atlanta July 14, 1975 Resigned Nov. 17, 1978. J. Charles Partee Richmond Jan. 5, 1976 Served until Feb. 7, 1986.3 Stephen S. Gardner Philadelphia Feb. 13, 1976 Died Nov. 19, 1978. David M. Lilly Minneapolis June 1, 1976 Resigned Feb. 24, 1978. G. William Miller San Francisco Mar. 8, 1978 Resigned Aug. 6, 1979. Nancy H. Teeters Chicago Sept. 18, 1978 Served through June 27, 1984. Emmett J. Rice New York June 20, 1979 Resigned Dec. 31, 1986. Frederick H. Schultz Atlanta July 27, 1979 Served through Feb. 11, 1982. Paul A. Volcker Philadelphia Aug. 6, 1979 Resigned August 11, 1987. Lyle E. Gramley Kansas City May 28, 1980 Resigned Sept. 1, 1985. Resigned April 30, 1986. Preston Martin San Francisco Mar. 31, 1982 Resigned March 11, 1991. Martha R. Seger Chicago July 2, 1984 Served through Feb. 9, 1994. Wayne D. Angell Kansas City Feb. 7, 1986 Resigned August 3, 1990. Manuel H. Johnson Richmond Feb. 7, 1986 Resigned July 31, 1989. H. Robert Heller San Francisco Aug. 19, 1986 Reappointed in 1990. Edward W. Kelley, Jr Dallas May 26, 1987 Reappointed in 1992. Alan Greenspan New York Aug. 11, 1987 Resigned April 30, 1995. John P. LaWare Boston Aug. 15, 1988 Resigned Feb. 14, 1994. David W. Mullins, Jr. St. Louis May 21, 1990 Lawrence B. Lindsey Richmond Nov. 26, 1991 Susan M. Phillips Chicago Dec. 2, 1991 Alan S. Blinder Philadelphia June 27, 1994 Janet L. Yellen San Francisco Aug. 12, 1994 Chairmen4 Vice Chairmen4 Charles S. Hamlin Aug. 10, 1914-Aug. 9, 1916 Frederic A. Delano Aug. 10, 1914-Aug. 9, 1916 W.P.G. Harding Aug. 10, 1916-Aug. 9, 1922 Paul M. Warburg Aug 10, 1916-Aug. 9, 1918 Daniel R. Crissinger May 1, 1923-Sept. 15, 1927 Albert Strauss Oct. 26, 1918-Mar. 15, 1920 Roy A. Young Oct. 4, 1927-Aug. 31, 1930 Edmund Piatt July 23, 1920-Sept. 14, 1930 Eugene Meyer Sept. 16, 1930-May 10, 1933 J.J. Thomas Aug. 21, 1934-Feb. 10, 1936 Eugene R. Black May 19, 1933-Aug. 15, 1934 Ronald Ransom Aug. 6, 1936-Dec. 2, 1947 Marriner S. Eccles Nov. 15, 1934-Jan. 31, 1948 C. Canby Balderston Mar. 11, 1955-Feb. 28, 1966 Thomas B. McCabe Apr. 15, 1948-Mar. 31, 1951 J.L. Robertson Mar. 1, 1966-Apr. 30, 1973 Wm. McC. Martin, Jr Apr. 2, 1951-Jan. 31, 1970 George W. Mitchell May 1, 1973-Feb. 13, 1976 Arthur F. Burns Feb. 1, 1970-Jan. 31, 1978 Stephen S. Gardner Feb. 13, 1976-Nov. 19, 1978 G. William Miller Mar. 8, 1978-Aug. 6, 1979 Frederick H. Schultz July 27, 1979-Feb. 11, 1982 Paul A. Volcker Aug. 6, 1979-Aug. 11, 1987 Preston Martin Mar. 31, 1982-Apr. 30, 1986 Alan Greenspan Aug. 11, 1987- Manuel H. Johnson Aug. 4, 1986-Aug. 3, 1990 David W. Mullins, Jr July 24, 1991-Feb. 14, 1994 Alan S. Blinder June 27, 1994- EX-OFFICIO MEMBERS1 Secretaries of the Treasury Comptrollers of the Currency W.G. McAdoo Dec. 23, 1913-Dec. 15, 1918 John Skelton Williams Feb. 2, 1914-Mar. 2, 1921 Carter Glass Dec. 16, 1918-Feb. 1, 1920 Daniel R. Crissinger Mar. 17, 1921-Apr. 30, 1923 David F. Houston Feb. 2, 1920-Mar. 3, 1921 Henry M. Dawes May 1, 1923-Dec. 17, 1924 Andrew W. Mellon Mar. 4, 1921-Feb. 12, 1932 Joseph W. Mcintosh Dec. 20, 1924-Nov. 20, 1928 Ogden L. Mills Feb. 12, 1932-Mar. 4, 1933 J.W. Pole Nov. 21, 1928-Sept. 20, 1932 William H. Woodin Mar. 4, 1933-Dec. 31, 1933 J.F.T. O'Connor May 11, 1933-Feb. 1, 1936 Henry Morgenthau Jr. Jan. 1, 1934-Feb. 1, 1936 1. Under the provisions of the original Federal Reserve Act, the Federal Comptroller of the Currency should continue to serve as members until Feb. Reserve Board was composed of seven members, including five appointive 1, 1936; that the appointive members in office on the date of that act should members, the Secretary of the Treasury, who was ex-officio chairman of the continue to serve until Feb. 1, 1936, or until their successors were appointed Board, and the Comptroller of the Currency. The original term of office was and had qualified; and that thereafter the terms of members should be ten years, and the five original appointive members had terms of two, four, fourteen years and that the designation o fChairman and Vice Chairman of six, eight, and ten years respectively. In 1922 the number of appointive the Board should be for a term of four years. members was increased to six, and in 1933 the term of office was increased to 2. Date after words "Resigned" and "Retired" denotes final da yof twelve years. The Banking Act of 1935, approved Aug. 23, 1935, changed service. the name of the Federal Reserve Board to the Board of Governors of the 3. Successor took office on this date. Federal Reserve System and provided that the Board should be composed of 4. Chairman and Vice Chairman were designated Governor and Vice seven appointive members; that the Secretary of the Treasury and the Governor before Aug. 23, 1935. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1 Financial and Business Statistics CONTENTS WEEKLY REPORTING COMMERCIAL BANKS Assets and liabilities A3 Guide to Tabular Presentation A21 Large reporting banks A23 Branches and agencies of foreign banks Domestic Financial Statistics MONEY STOCK AND BANK CREDIT FINANCIAL MARKETS A4 Reserves, money stock, liquid assets, and debt A24 Commercial paper and bankers dollar measures acceptances outstanding A25 Prime rate charged by banks on short-term A5 Reserves of depository institutions, Reserve Bank credit business loans A6 Reserves and borrowings—Depository A26 Interest rates—money and capital markets institutions A27 Stock market—Selected statistics A7 Selected borrowings in immediately available funds—Large member banks FEDERAL FINANCE POLICY INSTRUMENTS A28 Federal fiscal and financing operations A29 U.S. budget receipts and outlays A8 Federal Reserve Bank interest rates A30 Federal debt subject to statutory limitation A9 Reserve requirements of depository institutions A30 Gross public debt of U.S. Treasury—Types A10 Federal Reserve open market transactions and ownership A31 U.S. government securities dealers—Transactions FEDERAL RESERVE BANKS A32 U.S. government securities dealers—Positions and financing All Condition and Federal Reserve note statements A3 3 Federal and federally sponsored credit A12 Maturity distribution of loan and security agencies—Debt outstanding holdings MONETARY AND CREDIT AGGREGATES SECURITIES MARKETS AND CORPORATE FINANCE A13 Aggregate reserves of depository institutions and monetary base A34 New security issues—Tax-exempt state and local A14 Money stock, liquid assets, and debt measures governments and corporations A16 Deposit interest rates and amounts outstanding— A35 Open-end investment companies—Net sales commercial and BIF-insured banks and assets A17 Bank debits and deposit turnover A35 Corporate profits and their distribution A35 Nonfarm business expenditures on new plant and equipment A36 Domestic finance companies—Assets and COMMERCIAL BANKING INSTITUTIONS liabilities, and consumer, real estate, and business A18 Assets and liabilities, Wednesday figures credit Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

2 Federal Reserve Bulletin • June 1995 Domestic Financial Statistics—Continued A54 U.S. reserve assets A54 Foreign official assets held at Federal Reserve Banks REAL ESTATE A55 Selected U.S. liabilities to foreign official A37 Mortgage markets institutions A38 Mortgage debt outstanding REPORTED BY BANKS CONSUMER INSTALLMENT CREDIT IN THE UNITED STATES A39 Total outstanding A55 Liabilities to and claims on foreigners A39 Terms A56 Liabilities to foreigners A58 Banks' own claims on foreigners FLOW OF FUNDS A59 Banks' own and domestic customers' claims on foreigners A40 Funds raised in U.S. credit markets A59 Banks' own claims on unaffiliated foreigners A42 Summary of financial transactions A60 Claims on foreign countries—Combined A43 Summary of credit market debt outstanding domestic offices and foreign branches A44 Summary of financial assets and liabilities REPORTED BY NONBANKING BUSINESS Domestic Nonfinancial Statistics ENTERPRISES IN THE UNITED STATES SELECTED MEASURES A61 Liabilities to unaffiliated foreigners A62 Claims on unaffiliated foreigners A45 Nonfinancial business activity—Selected measures A45 Labor force, employment, and unemployment SECURITIES HOLDINGS AND TRANSACTIONS A46 Output, capacity, and capacity utilization A47 Industrial production—Indexes and gross value A63 Foreign transactions in securities A49 Housing and construction A64 Marketable U.S. Treasury bonds and A50 Consumer and producer prices notes—Foreign transactions A51 Gross domestic product and income A52 Personal income and saving INTEREST AND EXCHANGE RATES International Statistics A65 Discount rates of foreign central banks A65 Foreign short-term interest rates SUMMARY STATISTICS A66 Foreign exchange rates A53 U.S. international transactions—Summary A67 Guide to Statistical Releases and A54 U.S. foreign trade Special Tables Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

3 Guide to Tabular Presentation SYMBOLS AND ABBREVIATIONS c Corrected G-10 Group of Ten e Estimated GNMA Government National Mortgage Association n.a. Not available GDP Gross domestic product n.e.c. Not elsewhere classified HUD Department of Housing and Urban P Preliminary Development r Revised (Notation appears on column heading IMF International Monetary Fund when about half of the figures in that column IO Interest only are changed.) IPCs Individuals, partnerships, and corporations * Amounts insignificant in terms of the last decimal IRA Individual retirement account place shown in the table (for example, less than MMDA Money market deposit account 500,000 when the smallest unit given is millions) MSA Metropolitan statistical area 0 Calculated to be zero NOW Negotiable order of withdrawal Cell not applicable OCD Other checkable deposit ATS Automatic transfer service OPEC Organization of Petroleum Exporting Countries BIF Bank insurance fund OTS Office of Thrift Supervision CD Certificate of deposit PO Principal only CMO Collateralized mortgage obligation REIT Real estate investment trust FFB Federal Financing Bank REMIC Real estate mortgage investment conduit FHA Federal Housing Administration RP Repurchase agreement FHLBB Federal Home Loan Bank Board RTC Resolution Trust Corporation FHLMC Federal Home Loan Mortgage Corporation SAIF Savings Association Insurance Fund FmHA Farmers Home Administration SCO Securitized credit obligation FNMA Federal National Mortgage Association SDR Special drawing right FSLIC Federal Savings and Loan Insurance Corporation SIC Standard Industrial Classification G-7 Group of Seven VA Department of Veterans Affairs GENERAL INFORMATION In many of the tables, components do not sum to totals because include not fully guaranteed issues) as well as direct obligaof rounding. tions of the Treasury. "State and local government" also in- Minus signs are used to indicate (1) a decrease, (2) a negative cludes municipalities, special districts, and other political figure, or (3) an outflow. subdivisions. "U.S. government securities" may include guaranteed issues of U.S. government agencies (the flow of funds figures also Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.10 RESERVES, MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES Percent annual rate of change, seasonally adjusted1 1994 1995 1994 1995 MMoonneettaarryy oorr ccrreeddiitt aaggggrreeggaattee Q2 Q3 Q4 Q1 Nov. Dec. Jan. Feb. Mar. Reserves of depository institutions2 1 Total -3.1 -1.9 -3.3 -3.7 -1.9 -1.2 -4.4 -4.2 -7.4 2 Required -2.3 -1.9 -3.0 -4.0 -6.1 -4.5 -8.0 3.9 -4.5 3 Nonborrowed -4.2 -3.5 -2.1 -2.4 .7 -.4 -2.9 -2.6 -7.6 4 Monetary base3 8.4 7.5 6.9 6.4 8.5 4.1 8.1 3.6' 8.6 Concepts of money, liquid assets, and debt4 5 Ml 2.7 2.4 -1.2 .0 -.6 .3 1.0 -1.8 .7 6 M2 1.7 .9 -.4 1.8 .4 1.5r 4.0r -l.C 2.9 7 M3 1.3 2.1 1.7 4.3 1.8 3.5r 6.4r 2.3' 6.0 8 L 1.6 1.9 3.4 n.a. 2.4 10.4r 7.3r 12.2 n.a. 9 Debt 4.8 4.7 5.5 n.a. 5.9 4.3 5.5' 7.2 n.a. Nontransaction components 10 InM25 1.3 .2 .0 2.6 ,8r 2.0r 5.4' -.6' 3.9 11 In M3 only6 -1.3 8.5 13.1 17.5 9.2 i4.r 18.8' 19.7' 21.9 Time and savings deposits Commercial banks 12 Savings, including MMDAs -3.7 -4.6 -8.5 -13.1 -9.7 -10.9 -12.9 -15.8 -17.5 13 Small time7 .3 9.4 16.0 24.6 15.5 20.4 24.4 27.4 32.0 14 Large time8,9 .8 13.1 19.2 10.4 18.7 17.2r -8.1' 24.7' 15.1 Thrift institutions 15 Savings, including MMDAs -.4 -11.5 -17.6 -20.4 -21.0r -19.9r -19.3 -24.6' -19.4 16 Small time7 -5.8 .2 10.5 20.6 17.3r 5.3' 20.1' 30.5' 33.0 17 Large time8 -3.5 6.8 12.0 23.8 3.8 7.5 33.6 27.2 35.5 Money market mutual funds 18 General purpose and broker-dealer 11.9 5.7 7.5 8.2 12.0r 17.8r 9.9r -1.2 -1.2 19 Institution-only -15.7 -4.5 7.3 10.0 -2.0 2.0 36.5 -38.0 57.2 Debt components4 20 Federal 5.4 3.9 5.9 n.a. 8.5 1.1 2.5 10.7 n.a. 21 Nonfederal 4.5 4.9 5.3 n.a. 4.9 5.4 6.6' 5.9 n.a. 1. Unless otherwise noted, rates of change are calculated from average amounts Kingdom and Canada, and (3) balances in both taxable and tax-exempt, institution-only outstanding during preceding month or quarter. money market funds. Excludes amounts held by depository institutions, the U.S. govern- 2. Figures incorporate adjustments for discontinuities, or "breaks," associated with ment, money market funds, and foreign banks and official institutions. Also excluded is regulatory changes in reserve requirements. (See also table 1.20.) the estimated amount of overnight RPs and Eurodollars held by institution-only money 3. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally market funds. Seasonally adjusted M3 is computed by adjusting its non-M2 component as adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally adjusted currency a whole and then adding this result to seasonally adjusted M2. component of the money stock, plus (3) (for all quarterly reporters on the "Report of L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term Treasury Transaction Accounts, Other Deposits and Vault Cash" and for all weekly reporters securities, commercial paper, and bankers acceptances, net of money market fund holdwhose vault cash exceeds their required reserves) the seasonally adjusted, break-adjusted ings of these assets. Seasonally adjusted L is computed by summing U.S. savings bonds, difiference between current vault cash and the amount applied to satisfy current reserve short-term Treasury securities, commercial paper, and bankers acceptances, each seasonrequirements. ally adjusted separately, and then adding this result to M3. 4. Composition of the money stock measures and debt is as follows: Debt: The debt aggregate is the outstanding credit market debt of the domestic Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of nonfinancial sectors—the federal sector (U.S. government, not including governmentdepository institutions, (2) travelers checks of nonbank issuers, (3) demand deposits at all sponsored enterprises or federally related mortgage pools) and the nonfederal sectors commercial banks other than those owed to depository institutions, the U.S. government, (state and local governments, households and nonprofit organizations, nonfinancial corpoand foreign banks and official institutions, less cash items in the process of collection and rate and nonfarm noncorporate businesses, and farms). Nonfederal debt consists of Federal Reserve float, and (4) other checkable deposits (OCDs), consisting of negotiable mortgages, tax-exempt and corporate bonds, consumer credit, bank loans, commercial order of withdrawal (NOW) and automatic transfer service (ATS) accounts at depository paper, and other loans. The data, which are derived from the Federal Reserve Board's flow institutions, credit union share draft accounts, and demand deposits at thrift institutions. of funds accounts, are break-adjusted (that is, discontinuities in the data have been Seasonally adjusted Ml is computed by summing currency, travelers checks, demand smoothed into the series) and month-averaged (that is, the data have been derived by deposits, and OCDs, each seasonally adjusted separately. averaging adjacent month-end levels). M2: Ml plus (1) overnight (and continuing contract) repurchase agreements (RPs) 5. Sum of (1) overnight RPs and overnight Eurodollars, (2) money market fund issued by all depository institutions and overnight Eurodollars issued to U.S. residents by balances (general purpose and broker-dealer), (3) savings deposits (including MMDAs), foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and small and (4) small time deposits. time deposits (time deposits—including retail RPs—in amounts of less than $100,000), 6. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S. residents, and (3) balances in both taxable and tax-exempt general-purpose and broker-dealer and (4) money market fund balances (institution-only), less (5) a consolidation adjustment money market funds. Excludes individual retirement accounts (IRAs) and Keogh balances that represents the estimated amount of overnight RPs and Eurodollars held by institutionat depository institutions and money market funds. Also excludes all balances held by only money market funds. This sum is seasonally adjusted as a whole. US. commercial banks, money market funds (general purpose and broker-dealer), foreign 7. Small time deposits—including retail RPs—are those issued in amounts of less governments and commercial banks, and the U.S. government. Seasonally adjusted M2 is than $100,000. All IRA and Keogh account balances at commercial banks and thrift computed by adjusting its non-Mi component as a whole and then adding this result to institutions are subtracted from small time deposits. seasonally adjusted Ml. 8. Large time deposits are those issued in amounts of $100,000 or more, excluding M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of $100,000 or those booked at international banking facilities. more) issued by all depository institutions, (2) term Eurodollars held by U.S. residents at 9. Large time deposits at commercial banks less those held by money market funds, foreign branches of U.S. banks worldwide and at all banking offices in the United depository institutions, the U.S. government, and foreign banks and officii institutions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Money Stock and Bank Credit A5 1.11 RESERVES OF DEPOSITORY INSTITUTIONS AND RESERVE BANK CREDIT1 Millions of dollars Average of Average of daily figures for week ending on date indicated daily figures Factor 1995 1995 Jan. Feb. Mar. Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding 404,335 400,034' 404,520 398,954 400,871' 401,544 402,560 404,383 404,203 406,159 U.S. government securities 2 Bought outright—System account 363,467 361,651 364,433 359,922 363,074 363,465 363,898 364,415 364,029 365,474 3 Held under repurchase agreements 2,758 46 1,560 0 0 0 0 2,103 1,558 1,925 Federal agency obligations 4 Bought outright 3,600 3,542 3,478 3,546 3,546 3,522 3,491 3,491 3,491 3,455 5 Held under repurchase agreements 440 1 438 0 0 0 0 61 843 845 6 Acceptances 0 0 0 0 0 0 0 0 0 0 Loans to depository institutions 7 Adjustment credit 111 23 18 19 30 18 16 15 17 24 8 Seasonal credit 43 32 51 32 34 37 38 49 55 62 9 Extended credit 4 0 0 0 0 0 0 0 0 0 10 Float 727 651' 551 616 1,001' 857 991 420 460 399 11 Other Federal Reserve assets 33,184 34,086 33,991 34,820 33,186 33,646 34,126 33,830 33,751 33,975 12 Gold stock 11,050 11,050 11,052 11,050 11,050 11,050 11,050 11,051 11,053 11,053 13 Special drawing rights certificate account 8,018 8,018 8,018 8,018 8,018 8,018 8,018 8,018 8,018 8,018 14 Treasury currency outstanding 23,039r 23,106' 23,165 23,101' 23,115' 23,129 23,143 23,157 23,171 23,185 ABSORBING RESERVE FUNDS 15 Cutrency in circulation 399,379' 396,657' 400,509 396,554 397,265' 397,044 398,422 401,269 401,265 401,026 16 Treasury cash holdings 332 339 352 338 343 341 346 349 353 358 Deposits, other than reserve balances, with Federal Reserve Banks 17 Treasury 7,147 5,753 5,141 4.789 5,707 5,177 5,158 5,175 6,000 4,600 18 Foreign 198 183 197 187 200 183 177 173 221 184 19 Service-related balances and adjustments .. 4,460 4,349 4,325 4,368 4,241 4,171 4,282 4,371 4,395 4,304 20 Other 333 426 393 356 359 665 393 384 404 385 21 Other Federal Reserve liabilities and capital . 12,367 12,705 12,996 12,691 12,724 12,941 13,326 12,850 12,806 12,789 22 Reserve balances with Federal Reserve Banks: 22,225 21,797' 22,842 21,839 22,217' 23,218 22,668 22,037 21,001 24,769 End-of-month figures Wednesday figures Jan. Feb. Mar. Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding 403,812 405,235' 409,451 404,187 403,554' 402,964 401,864 411,183 404,828 408,235 U.S. government securities2 Bought outright—System account . 362,987 365,631 363,707 366,209 365,087 364,466 361,803 363,318 364,094 367,394 Held under repurchase agreements 2,010 0 5,593 0 0 0 0 9,018 1,935 1,930 Federal agency obligations Bought outright 3,546 3,491 3,408 3,546 3,546 3,491 3,491 3,491 3,491 3,408 Held under repurchase agreements 1,320 0 1,105 0 0 0 0 325 900 1,171 Acceptances 0 0 0 0 0 0 0 0 0 0 Loans to depository institutions Adjustment credit 48 18 25 20 25 13 16 18 17 52 Seasonal credit 30 36 59 33 38 42 40 53 57 63 Extended credit 0 0 0 0 0 0 0 0 0 0 Float 151 1,892' 61 1,398 1,555' 678 2,725 1,204 398 66 Other Federal Reserve assets 33,722 34,167 35,493 32,980 33,303 34,274 33,789 33,757 33,935 34,150 12 Gold stock 11,050 11,050 11,053 11,050 11,050 11,050 11,050 11,051 11,053 11,053 13 Special drawing rights certificate account . 8,018 8,018 8,018 8,018 8,018 8,018 8,018 8,018 8,018 8,018 14 Treasury currency outstanding 23,073r 23,129' 23,199 23,101' 23,115' 23,129 23,143 23,157 23,171 23,185 ABSORBING RESERVE FUNDS 15 Currency in circulation 396,041r 397,745' 401,595 397,386' 398,110' 398,166 400,421 402,328 401,812 402,345 16 Treasury cash holdings 335 340 361 343 340 345 349 352 358 361 Deposits, other than reserve balances, with Federal Reserve Banks 17 Treasury 13,964 6,890 4,543 5,234 5,660 3,461 5,114 5,470 4,413 4,389 18 Foreign 185 188 370 166 296 265 166 165 162 185 19 Service-related balances and adjustments .. 4,810 4,171 4,230 4,368 4,241 4,171 4,282 4,371 4,395 4,304 20 Other 308 325 398 386 332 408 381 413 392 397 21 Other Federal Reserve liabilities and capital . 12,854 13,710 14,449 12,480 12,570 13,278 12,312 12,761 12,581 12,558 22 Reserve balances with Federal Reserve Banks3 17,456 24,062' 25,776 25,992 24,188' 25,066 21,051 27,550 22,958 25,954 1. Amounts of cash held as reserves are shown in table 1.12, line 2. 3. Excludes required clearing balances and adjustments to compensate for float. 2. Includes securities loaned—fully guaranteed by U.S. government securities pledged with Federal Reserve Banks—and excludes securities sold and scheduled to be bought back under matched sale-purchase transactions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.12 RESERVES AND BORROWINGS Depository Institutions1 Millions of dollars Prorated monthly averages of biweekly averages RReesseerrvvee ccllaassssiiffiiccaattiioonn 1992 1993 1994 1994 1995 Dec. Dec. Dec. Sept. Oct. Nov. Dec. Jan. Feb/ Mar. 1 Reserve balances with Reserve Banks2 25,368 29,374 24,658 25,157 24,745 24,715 24,658 22,291 21,758 22,652 2 Total vault cash3 34,541 36,818 40,365 38,433 38,231 38,933 40,365 42,29lr 39,794 38,517 3 Applied vault cash4 31,172 33,484 36,682 34,794 34,745 35,291 36,682 38,230 35,941 34,934 4 Surplus vault cash5 3,370 3,334 3,683 3,639 3,486 3,642 3,683 4,060r 3,854 3,583 5 Total reserves6 56,540 62,858 61,340 59,951 59,490 60,006 61,340 60,521 57,699 57,586 6 Required reserves 55,385 61,795 60,172 58,891 58,686 58,999 60,172 59,182 56,752 56,788 7 Excess reserve balances at Reserve Banks7 1,155 1,063 1,168 1,060 804 1,008 1,168 1,339 946 799 8 Total borrowings at Reserve Banks8 124 82 209 487 380 249 209 136 59 69 9 Seasonal borrowings 18 31 100 444 339 164 100 46 33 51 10 Extended credit9 1 0 0 0 0 0 0 4 0 0 Biweekly averages of daily figures for two week periods ending on dates indicated 1994 1995 Dec. 7 Dec. 21 Jan. 4 Jan. 18 Feb. 1 Feb. 15 Mar. 1 Mar. 15 Mar. 29 Apr. 12 1 Reserve balances with Reserve Banks2 24,638 24,288 25,189 23,958 19,603 21,028 22,710 22,316 22,875 23,421 2 Total vault cash3 39,936 40,864 39,967 42,165 43,142 41,294 37,923 39,317 37,772 38,432 3 Applied vault cash4 36,245 37,082 36,429 38,223 38,793 37,274 34,286 35,636 34,278 34,941 4 Surplus vault cash5 3,691 3,782 3,539 3,942 4,349 4,020 3,637 3,681 3,495 3,491 5 Total reserves6 60,883 61,370 61,618 62,181 58,396 58,302 56,995 57,952 57,153 58,361 6 Required reserves 59,538 60,291 60,451 60,822 57,026 57,329 56,111 57,385 56,075 57,936 7 Excess reserve balances at Reserve Banks7 1,346 1,080 1,167 1,360 1,370 973 885 566 1,078 425 8 Total borrowings at Reserve Banks8 216 179 246 68 176 51 60 59 79 76 9 Seasonal borrowings 112 98 95 38 41 31 36 44 59 61 10 Extended credit9 0 0 0 0 10 0 0 0 0 0 1. Data in this table also appear in the Board's H.3 (502) weekly statistical release. For cash applied during the maintenance period by "nonbound" institutions (that is, those ordering address, see inside ftont cover. whose vault cash exceeds their required reserves) to satisfy current reserve requirements. 2. Excludes required clearing balances and adjustments to compensate for float and 5. Total vault cash (line 2) less applied vault cash (line 3). includes other off-balance-sheet "as-of' adjustments. 6. Reserve balances with Federal Reserve Banks (line 1) plus applied vault cash 3. Total "lagged" vault cash held by depository institutions subject to reserve (line 3). requirements. Dates refer to the maintenance periods during which the vault cash may be 7. Total reserves (line 5) less required reserves (line 6). used to satisfy reserve requirements. The maintenance period for weekly reporters ends 8. Also includes adjustment credit. sixteen days after the lagged computation period during which the vault cash is held. 9. Consists of borrowing at the discount window under the terms and conditions Before Nov. 25, 1992, the maintenance period ended thirty days after the lagged established for the extended credit program to help depository institutions deal with computation period. sustained liquidity pressures. Because there is not the same need to repay such borrowing 4. All vault cash held during the lagged computation period by "bound" institutions promptly as with traditional short-term adjustment credit, the money market impact of (that is, those whose required reserves exceed their vault cash) plus the amount of vault extended credit is similar to that of nonborrowed reserves. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Money Stock and Bank Credit A7 1.13 SELECTED BORROWINGS IN IMMEDIATELY AVAILABLE FUNDS Large Banks1 Millions of dollars, averages of daily figures 1995, week ending Monday SSoouurrccee aanndd mmaattuurriittyy Jan. 30 Feb. 6 Feb. 13 Feb. 20 Feb. 27 Mar. 6 Mar. 13 Mar. 20 Mar. 27 Federal funds purchased, repurchase agreements, and other selected borrowings From commercial banks in the United States 1 For one day or under continuing contract 73,540 74,373 71,099 74,506 69,701 72,625 74,398 69,882 68,115 2 For all other maturities 15,165 15,394 14,544 14,022 14,853 15,823 16,308 16,714 17,463 From other depository institutions, foreign banks and official institutions, and U.S. government agencies 3 For one day or under continuing contract 15,016 20,317 19,630 21,042 18,988 18,601 18,407 18,882 21,227 4 For all other maturities 20,508 20,479 23,904 22,603 24,916 25,283 28,095 29,647 29,805 Repurchase agreements on U.S. government and federal agency securities Brokers and nonbank dealers in securities 5 For one day or under continuing contract 20,598 23,508 22,125 22,527 21,324 21,213 21,790 27,744 27,267 6 For all other maturities 36,400r 33,747 35,697 33,721 34,532 32,729 33,540 34,323 35,356 All other customers 7 For one day or under continuing contract 38,572 39,335 37,966 38,545 37,337 37,718 36,792 36,743 37,187 8 For all other maturities 18,616 17,323 18,202 18,293 18,981 18,979 18,752 17,898 18,557 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 68,464 69,137 64,408 67,736 65,706 66,526 63,537 65,881 60,591 10 To all other specified customers2 24,888 27,851 28,860 29,856 28,604 28,920 25,916 27,201 27,888 1. Banks with assets of $4 billion or more as of Dec. 31, 1988. 2. Brokers and nonbank dealers in securities, other depository institutions, foreign Data in this table also appear in the Board's H.5 (507) weekly statistical release. For banks and official institutions, and U.S. government agencies, ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.14 FEDERAL RESERVE BANK INTEREST RATES Percent per year Current and previous levels Adjustment credit Seasonal credit Extended credit Federal Reserve Bank On On Previous rate On Previous rate 4/28/95 4/28/95 4/28/95 Boston 2/1/95 New York.... 2/1/95 Philadelphia.. 2/2/95 Cleveland 2/9/95 Richmond.. .. 2/1/95 Atlanta 2/2/95 Chicago 2/1/95 St. Louis 2/1/95 Minneapolis.. 2/2/95 Kansas City .. 2/1/95 Dallas 2/2/95 San Francisco. 2/1/95 Range of rates for adjustment credit in recent years Range (or F.R. Range (or F.R. Range (or F.R. l A ev ll e l F ) . — R. B o an f k l A ev ll e l F ) . — R. B o an f k Effective date l A ev ll e l F } . — R. Ba o n f k Banks N.Y. Banks N.Y. Banks N.Y. In effect Dec. 31, 1977 1981—Nov. 2 13-14 13 1987—Sept. 4 5.5-6 6 6 13 13 11 6 6 1978—Jan. 9 6-6.5 6.5 Dec. 4 12 12 20 6.5 6.5 1988—Aug. 9 6-6.5 6.5 May 11 6.5-7 7 1982—July 20 11.5-12 11.5 11 6.5 6.5 12 7 7 23 11.5 11.5 July 3 7-7.25 7.25 Aug. 2 11-11.5 11 1989—Feb. 24 6.5-7 7 10 7.25 7.25 3 11 11 27 7 7 Aug. 21 7.75 7.75 16 10.5 10.5 Sept. 22 8 8 27 10-10.5 10 1990—Dec. 19 6.5 6.5 Oct. 16 8-8.5 8.5 30 10 10 20 8.5 8.5 Oct. 12 9.5-10 9.5 1991—Feb. 1 6-6.5 6 Nov. 1 8.5-9.5 9.5 13 9.5 9.5 4 6 6 3 9.5 9.5 Nov. 22 9-9.5 9 Apr. 30 5.5-6 5.5 26 9 9 May 2 5.5 5.5 1979—July 20 10 10 Dec. 14 8.5-9 9 Sept. 13 5-5.5 5 Aug. 17 10-10.5 10.5 15 8.5-9 8.5 17 5 5 20 10.5 10.5 17 8.5 8.5 Nov. 6 4.5-5 4.5 Sept. 19 10.5-11 11 7 4.5 4.5 21 11 11 1984—Apr. 9 8.5-9 9 Dec. 20 3.5-4.5 3.5 Oct. 8 11-12 12 13 9 9 24 3.5 3.5 10 12 12 Nov. 21 8.5-9 8.5 26 8.5 8.5 1992—July 2 3-3.5 3 1980—Feb. 15 12-13 13 Dec. 24 8 8 7 3 3 19 13 13 May 29 12-13 13 1985—May 20 7.5-8 7.5 1994—May 17 3-3.5 3.5 30 12 12 24 7.5 7.5 18 3.5 3.5 June 13 11-12 11 Aug. 16 3.5-4 4 16 11 11 1986—Mar. 7 7-7.5 7 18 4 4 July 28 10-11 10 10 7 7 Nov. 15 4—4.75 4.75 29 10 10 Apr. 21 6.5-7 6.5 17 4.75 4.75 Sept. 26 11 11 23. 6.5 6.5 Nov. 17 12 12 July 11 6 6 1995—Feb. 1 4.75-5.25 5.25 Dec. 5 12-13 13 Aug. 21 5.5-6 5.5 9 5.25 5.25 8 13 13 22 5.5 5.5 1981—May 5 13-14 14 In effect Apr. 28, 1995 5.25 5.25 14 14 1. Available on a short-term basis to help depository institutions meet temporary needs thirty days; however, at the discretion of the Federal Reserve Bank, this time period may for funds that cannot be met through reasonable alternative sources. The highest rate be shortened. Beyond this initial period, a flexible rate somewhat above rates charged on established for loans to depository institutions may be charged on adjustment credit loans market sources of funds is charged. The rate ordinarily is reestablished on the first of unusual size that result from a major operating problem at the borrower's facility. business day of each two-week reserve maintenance period, but it is never less than the 2. Available to help relatively small depository institutions meet regular seasonal needs discount rate applicable to adjustment credit plus 50 basis points. for funds that arise from a clear pattern of intrayearly movements in their deposits and 4. For earlier data, see the following publications of the Board of Governors: Banking loans and that cannot be met through special industry lenders. The discount rate on and Monetary Statistics, 1914-1941, and 1941-1970', and the Annual Statistical Digest, seasonal credit takes into account rates charged by market sources of funds and ordinarily 1970-1979. is reestablished on the first business day of each two-week reserve maintenance period; In 1980 and 1981, the Federal Reserve applied a surcharge to short-term adjustmenthowever, it is never less than the discount rate applicable to adjustment credit. credit borrowings by institutions with deposits of $500 million or more that had borrowed 3. May be made available to depository institutions when similar assistance is not in successive weeks or in more than four weeks in a calendar quarter. A 3 percent reasonably available from other sources, including special industry lenders. Such credit surcharge was in effect from Mar. 17, 1980, through May 7, 1980. A surcharge of 2 may be provided when exceptional circumstances (including sustained deposit drains, percent was reimposed on Nov. 17, 1980; the surcharge was subsequently raised to 3 impaired access to money market funds, or sudden deterioration in loan repayment percent on Dec. 5,1980, and to 4 percent on May 5,1981. The surcharge was reduced to 3 performance) or practices involve only a particular institution, or to meet the needs of percent effective Sept. 22, 1981, and to 2 percent effective Oct. 12, 1981. As of Oct. 1, institutions experiencing difficulties adjusting to changing market conditions over a longer 1981, the formula for applying the surcharge was changed from a calendar quarter to a period (particularly at times of deposit disintermediation). The discount rate applicable to moving thirteen-week period. The surcharge was eliminated on Nov. 17, 1981. adjustment credit ordinarily is charged on extended-credit loans outstanding less than Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A9 1.15 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS1 Type of deposit Net transaction accounts3 1 $0 million-$54.0 million.. 12/20/94 2 More than $54.0 million4 . 12/20/94 3 Nonpersonal time deposits5 12/27/90 4 Eurocurrency liabilities6... 12/27/90 1. Required reserves must be held in the form of deposits with Federal Reserve no more than three may be checks (accounts subject to such limits are considered savings Banks or vault cash. Nonmember institutions may maintain reserve balances with a deposits). Federal Reserve Bank indirectly, on a pass-through basis, with certain approved The Monetary Control Act of 1980 requires that the amount of transaction accounts institutions. For previous reserve requirements, see earlier editions of the Annual against which the 3 percent reserve requirement applies be modified annually by 80 Report or the Federal Reserve Bulletin. Under provisions of the Monetary Control Act percent of the percentage change in transaction accounts held by all depository instituof 1980, depository institutions include commercial banks, mutual savings banks, tions, determined as of June 30 of each year. Effective Dec. 20, 1994, the amount was savings and loan associations, credit unions, agencies and branches of foreign banks, increased from $51.9 million to $54.0 million. and Edge Act corporations. 4. The reserve requirement was reduced from 12 percent to 10 percent on 2. The Garn-St Germain Depository Institutions Act of 1982 requires that $2 million Apr. 2, 1992, for institutions that report weekly, and on Apr. 16, 1992, for institutions that of reservable liabilities of each depository institution be subject to a zero percent reserve report quarterly. requirement. The Board is to adjust the amount of reservable liabilities subject to this zero 5. For institutions that report weekly, the reserve requirement on nonpersonal time percent reserve requirement each year for the succeeding calendar year by 80 percent of deposits with an original maturity of less than 1 x/l years was reduced from 3 percent to the percentage increase in the total reservable liabilities of all depository institutions, 1 '/S percent for the maintenance period that began Dec. 13, 1990, and to zero for the measured on an annual basis as of June 30. No corresponding adjustment is to be made in maintenance period that began Dec. 27, 1990. The reserve requirement on nonpersonal the event of a decrease. On Dec. 20, 1994, the exemption was raised from $4.0 million to time deposits with an original maturity of 1 years or more has been zero since Oct. 6, $4.2 million. The exemption applies only to accounts that would be subject to a 3 percent 1983. reserve requirement. For institutions that report quarterly, the reserve requirement on nonpersonal time 3. Includes all deposits against which the account holder is permitted to make with- deposits with an original maturity of less than 1'/i years was reduced from 3 percent to drawals by negotiable or transferable instruments, payment orders of withdrawal, and zero on Jan. 17, 1991. telephone and preauthorized transfers for the purpose of making payments to third persons 6. The reserve requirement on Eurocurrency liabilities was reduced from 3 percent to or others, other than money market deposit accounts (MMDAs) and similar accounts that zero in the same manner and on the same dates as was the reserve requirement on permit no more than six preauthorized, automatic, or other transfers per month, of which nonpersonal time deposits with an original maturity of less than 1 x/i years (see note 5). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 DomesticN onfinancial Statistics • June 1995 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS1 Millions of dollars 1994 1995 TTyyppee ooff ttrraannssaaccttiioonn 11999922 11999933 11999944 aanndd mmaattuurriittyy Aug. Sept. Oct. Nov. Dec. Jan. Feb. US. TREASURY SECURITIES Outright transactions (excluding matched transactions) Treasury bills 1 Gross purchases 14,714 17,717 17,484 1,610 0 518 6,109 444 0 0 2 Gross sales 1,628 0 0 0 0 0 0 0 0 0 3 Exchanges 308,699 332,229 380,327 36,281 29,668 29,361 36,543 29,883 37,122 31,530 4 Redemptions 1,600 0 0 0 0 0 0 0 0 0 Others within one year 5 Gross purchases 1,096 1,223 1,238 0 151 450 0 125 0 0 6 Gross sales 0 0 0 0 0 0 0 0 0 0 7 Maturity shifts 36,662 31,368 0 6,131 961 460 1,790 -2,430 2,835 5,872 8 Exchanges -30,543 -36,582 -21,444 -4,089 -2,203 0 -5,795 1,680 -3,167 -4,881 9 Redemptions 0 0 0 0 0 0 0 0 0 0 One to five years 10 Gross purchases 13,118 10,350 9,168 0 2,530 0 200 2,208 0 0 11 Gross sales 0 0 0 0 0 0 0 0 0 0 12 Maturity shifts -34,478 -27,140 -6,004 -5,506 -837 -460 -1,123 2,430 -2,145 -5,115 13 Exchanges 25,811 0 17,801 2,889 2,203 0 4,192 -1,680 3,167 3,031 Five to ten years 14 Gross purchases 2,818 4,168 3,818 0 938 0 0 660 0 0 15 Gross sales 0 0 0 0 0 0 0 0 0 0 16 Maturity shifts -1,915 0 -3,145 -549 -125 0 -278 0 -690 -757 17 Exchanges 3,532 0 2,903 750 0 0 1,603 0 0 1,150 More than ten years 18 Gross purchases 2,333 3,457 3,606 0 840 0 0 1,252 0 0 19 Gross sales 0 0 0 0 0 0 0 0 0 0 20 Maturity shifts -269 0 -918 -76 0 0 -389 0 0 0 21 Exchanges 1,200 0 775 450 0 0 0 0 0 700 All maturities 22 Gross purchases 34,079 36,915 35,314 1,610 4,459 968 6,309 4,689 0 0 23 Gross sales 1,628 0 0 0 0 0 0 0 0 0 24 Redemptions 1,600 767 2,337 0 0 979 0 0 621 0 Matched transactions 25 Gross purchase 1,480,140 1,475,941 1,700,836 169,018 151,029 136,556 148,425 166,648 160,465 178,877 26 Gross sales 1,482,467 1,475,085 1,701,309 170,356 151,589 137,242 147,858 166,007 167,676 176,232 Repurchase agreements 27 Gross purchases 378,374 475,447 309,276 44,948 4,975 17,088 35,456 29,406 32,201 1,300 28 Gross sales 386,257 470,723 311,898 41,199 9,354 15,613 32,561 26,351 39,756 3,310 29 Net change in U.S. Treasury securities 20,642 41,729 29,882 4,022 -479 778 9,771 8,385 -15,387 634 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 632 774 1,002 63 31 62 70 37 91 55 Repurchase agreements 33 Gross purchases 14,565 35,063 52,696 8,491 3,620 2,868 8,615 5,090 5,243 25 34 Gross sales 14,486 34,669 52,696 8,109 4,982 2,838 7,360 5,720 4,948 1,345 35 Net change in federal agency obligations -554 -380 -1,002 319 -1,393 -32 1,185 -667 204 -1,375 36 Total net change in System Open Market Account... 20,089 41,348 28,880 4,341 -1,872 746 10,956 7,718 -15,183 -741 1. Sales, redemptions, and negative figures reduce holdings of the System Open Market Account; all other figures increase such holdings. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Banks All 1.18 FEDERAL RESERVE BANKS Condition and Federal Reserve Note Statements1 Millions of dollars Wednesday End of month AAAccccccooouuunnnttt 1995 1995 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 Jan. 31 Feb. 28 Mar. 31 Consolidated condition statement ASSETS 1 Gold certificate account 11,050 11,050 11,051 11,053 11,053 11,050 11,050 11,053 2 Special drawing rights certificate account 8,018 8,018 8,018 8,018 8,018 8,018 8,018 8,018 3 Coin 424 421 423 422 415 402 429 434 Loans 4 To depository institutions 55 55 71 73 115 77 54 84 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 3,491 3,491 3,491 3,491 3,408 3,546 3,491 3,408 8 Held under repurchase agreements 0 0 325 900 1,171 1,320 0 1,105 9 Total U.S. Treasury securities 364,466 361,803 372,336 366,029 369,324 364,997 365,631 369,300 10 Bought outright2 364,466 361,803 363,318 364,094 367,394 362,987 365,631 363,707 11 Bills 177,946 175,284 176,798 177,574 180,874 176,467 179,111 177,187 12 Notes 143,773 143,773 143,773 143,773 143,773 143,522 143,773 143,773 13 Bonds 42,747 42,747 42,747 42,747 42,747 42,998 42,747 42,747 14 Held under repurchase agreements 0 0 9,018 1,935 1,930 2,010 0 5,593 15 Total loans and securities 368,012 365,350 376,223 370,494 374,019 369,940 369,176 373,897 16 Items in process of collection 6,594 7,898 6,461 4,831 4,693 6,979 9,161 3,611 17 Bank premises 1,078 1,079 1,079 1,082 1,081 1,076 1,078 1,080 Other assets 18 Denominated in foreign currencies3 24,746 24,064 23,611 23,631 23,657 22,829 24,743 25,286 19 All other4 8,475 8,642 9,076 9,232 9,407 9,833 8,388 9,129 20 Total assets 428,398 426,523 435,943 428,763 432,342 430,126 432,044 432,508 LIABILITIES 21 Federal Reserve notes 375,806 378,048 379,946 379,420 379,936 373,705 375,385 379,191 22 Total deposits 33,757 31,125 38,293 32,285 35,519 37,224 36,469 35,320 23 Depository institutions 29,622 25,463 32,246 27,319 30,548 22,768 28,754 30,009 24 U.S. Treasury—General account 3,461 5,114 5,470 4,413 4,389 13,964 6,890 4,543 25 Foreign—Official accounts 265 166 165 162 185 185 188 370 26 Other 408 381 413 392 397 308 325 398 27 Deferred credit items 5,556 5,038 4,942 4,477 4,330 6,343 6,479 3,549 28 Other liabilities and accrued dividends5 4,437 4,369 4,780 4,587 4,544 4,423 4,510 4,578 29 Total liabilities 419,556 418,580 427,961 420,770 424,328 421,696 422,843 422,638 CAPITAL ACCOUNTS 30 Capital paid in 3,768 3,765 3,769 3,775 3,781 3,696 3,768 3,786 31 Surplus 3,683 3,683 3,683 3,683 3,683 3,683 3,683 3,683 32 Other capital accounts 1,390 494 529 535 549 1,051 1,749 2,401 33 Total liabilities and capital accounts 428,398 426,523 435,943 428,763 432,342 430,126 432,044 432,508 MEMO 34 Marketable US. Treasury securities held in custody for foreign and international accounts 416,571 418,601 419,363 429,482 429,759 408,118 418,667 429,759 Federal Reserve note statement 35 Federal Reserve notes outstanding (issued to Banks) 456,702 455,720 455,014 454,434 453,497 455,470 457,095 452,980 36 LESS: Held by Federal Reserve Banks 80,896 77,672 75,068 75,013 73,561 81,765 81,710 73,790 37 Federal Reserve notes, net 375,806 378,048 379,946 379,420 379,936 373,705 375,385 379,191 Collateral held against notes, net 38 Gold certificate account 11,050 11,050 11,051 11,053 11,053 11,050 11,050 11,053 39 Special drawing rights certificate account 8,018 8,018 8,018 8,018 8,018 8,018 8,018 8,018 40 Other eligible assets 0 0 0 0 0 0 0 0 41 US. Treasury and agency securities 356,738 358,979 360,877 360,349 360,864 354,637 356,317 360,119 42 Total collateral 375,806 378,048 379,946 379,420 379,936 373,705 375,385 379,191 1. Some of the data in this table also appear in the Board's H.4.1 (503) weekly 3. Valued monthly at market exchange rates. statistical release. For ordering address, see inside front cover. 4. Includes special investment account at the Federal Reserve Bank of Chicago in 2. Includes securities loaned—fully guaranteed by US. Treasury securities pledged Treasury bills maturing within ninety days. with Federal Reserve Banks—and excludes securities sold and scheduled to be bought 5. Includes exchange-translation account reflecting the monthly revaluation at market back under matched sale-purchase transactions. exchange rates of foreign exchange commitments. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holding Millions of dollars Wednesday End of month TTTyyypppeee ooofff hhhooollldddiiinnnggg aaannnddd mmmaaatttuuurrriiitttyyy 1995 1995 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 Jan. 31 Feb. 28 Mar. 31 1 Total loans 55 56 71 73 116 77 54 86 2 Within fifteen days1 24 24 36 71 110 67 38 82 3 Sixteen days to ninety days 31 32 35 2 6 10 16 4 9 Total U.S. Treasury securities 364,466 361,803 372,336 366,029 367,396 362,988 365,631 363,707 10 Within fifteen days1 16,420 13,369 19,311 19,703 21,375 14,385 11,471 9,764 11 Sixteen days to ninety days 83,813 90,027 90,568 84,117 84,013 84,818 89,928 94,316 12 Ninety-one days to one year 114,967 109,142 113,192 112,942 112,742 112,969 113,264 111,365 13 One year to five years 86,731 86,731 86,731 86,731 86,730 89,373 87,864 85,728 14 Five years to ten years 26,990 26,990 26,990 26,990 26,990 26,597 27,561 26,990 15 More than ten years 35,545 35,545 35,545 35,545 35,545 34,845 35,545 35,545 16 Total federal agency obligations 3,491 3,491 3,815 4,391 3,409 3,546 3,491 3,408 17 Within fifteen days' 0 0 408 1,198 216 116 255 215 18 Sixteen days to ninety days 448 814 731 516 524 683 448 524 19 Ninety-one days to one year 1,143 777 777 777 782 847 888 782 20 One year to five years 1,418 1,418 1,418 1,418 1,405 1,393 1,418 1,405 21 Five years to ten years 457 457 457 457 457 482 457 457 22 More than ten years 25 25 25 25 25 25 25 25 1. Holdings under repurchase agreements are classified as maturing within fifteen days NOTE. Total acceptances data have been deleted from this table because data are no in accordance with maximum maturity of the agreements. longer available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary and Credit Aggregates A13 1.20 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND MONETARY BASE1 Billions of dollars, averages of daily figures 1994 1995 11999911 11999922 11999933 11999944 IItteemm DDeecc.. DDeecc.. DDeecc.. DDeecc.. Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Seasonally adjusted AAAADDDDJJJJUUUUSSSSTTTTEEEEDDDD FFFFOOOORRRR CCCCHHHHAAAANNNNGGGGEEEESSSS IIIINNNN RRRREEEESSSSEEEERRRRVVVVEEEE RRRREEEEQQQQUUUUIIIIRRRREEEEMMMMEEEENNNNTTTTSSSS2222 1111 TTTToooottttaaaallll rrrreeeesssseeeerrrrvvvveeeessss3333 45.54 54.35 60.50 59.34 59.84 59.79 59.50 59.40 59.34 59.12 58.92 58.56 2222 NNNNoooonnnnbbbboooorrrrrrrroooowwwweeeedddd rrrreeeesssseeeerrrrvvvveeeessss4444 45.34 54.23 60.42 59.13 59.37 59.31 59.12 59.15 59.13 58.99 58.86 58.49 3333 NNNNoooonnnnbbbboooorrrrrrrroooowwwweeeedddd rrrreeeesssseeeerrrrvvvveeeessss pppplllluuuussss eeeexxxxtttteeeennnnddddeeeedddd ccccrrrreeeeddddiiiitttt5555 45.34 54.23 60.42 59.13 59.37 59.31 59.12 59.15 59.13 58.99 58.86 58.49 4444 RRRReeeeqqqquuuuiiiirrrreeeedddd rrrreeeesssseeeerrrrvvvveeeessss 44.56 53.20 59.44 58.17 58.84 58.73 58.69 58.39 58.17 57.79 57.97 57.76 5555 MMMMoooonnnneeeettttaaaarrrryyyy bbbbaaaasssseeee6666 317.43 351.12 386.60 418.22 409.24 411.34 413.85 416.79 418.22 421.05 422.31 425.33 Not seasonally adjusted 6666 TTTToooottttaaaallll rrrreeeesssseeeerrrrvvvveeeessss7777 46.98 56.06 62.37 61.13 59.14 59.73 59.24 59.73 61.13 60.52 57.72 57.62 7777 NNNNoooonnnnbbbboooorrrrrrrroooowwwweeeedddd rrrreeeesssseeeerrrrvvvveeeessss 46.78 55.93 62.29 60.92 58.67 59.24 58.86 59.48 60.92 60.38 57.66 57.56 8888 NNNNoooonnnnbbbboooorrrrrrrroooowwwweeeedddd rrrreeeesssseeeerrrrvvvveeeessss pppplllluuuussss eeeexxxxtttteeeennnnddddeeeedddd ccccrrrreeeeddddiiiitttt5555 46.78 55.93 62.29 60.92 58.67 59.24 58.86 59.48 60.92 60.39 57.66 57.56 9999 RRRReeeeqqqquuuuiiiirrrreeeedddd rrrreeeesssseeeerrrrvvvveeeessss8888 46.00 54.90 61.31 59.96 58.14 58.67 58.44 58.72 59.96 59.18 56.78 56.83 11110000 MMMMoooonnnneeeettttaaaarrrryyyy bbbbaaaasssseeee9999 321.07 354.55 390.59 422.51 409.21 411.37 413.15 417.08 422.51 421.84 419.25 423.25 NNNNOOOOTTTT AAAADDDDJJJJUUUUSSSSTTTTEEEEDDDD FFFFOOOORRRR CCCCHHHHAAAANNNNGGGGEEEESSSS IIIINNNN RRRREEEESSSSEEEERRRRVVVVEEEE RRRREEEEQQQQUUUUIIIIRRRREEEEMMMMEEEENNNNTTTTSSSS11110000 11111111 TTTToooottttaaaallll rrrreeeesssseeeerrrrvvvveeeessss11111111 55.53 56.54 62.86 61.34 59.34 59.95 59.49 60.01 61.34 60.52 57.70 57.59 11112222 NNNNoooonnnnbbbboooorrrrrrrroooowwwweeeedddd rrrreeeesssseeeerrrrvvvveeeessss 55.34 56.42 62.78 61.13 58.87 59.47 59.11 59.76 61.13 60.39 57.64 57.52 11113333 NNNNoooonnnnbbbboooorrrrrrrroooowwwweeeedddd rrrreeeesssseeeerrrrvvvveeeessss pppplllluuuussss eeeexxxxtttteeeennnnddddeeeedddd ccccrrrreeeeddddiiiitttt5555 55.34 56.42 62.78 61.13 58.87 59.47 59.11 59.76 61.13 60.39 57.64 57.52 11114444 RRRReeeeqqqquuuuiiiirrrreeeedddd rrrreeeesssseeeerrrrvvvveeeessss 54.55 55.39 61.80 60.17 58.33 58.89 58.69 59.00 60.17 59.18 56.75 56.79 11115555 MMMMoooonnnneeeettttaaaarrrryyyy bbbbaaaasssseeee11112222 333.61 360.90 397.62 427.25 414.92 416.70 418.19 421.90 427.25 426.31 423.57 427.54 11116666 EEEExxxxcccceeeessssssss rrrreeeesssseeeerrrrvvvveeeessss11113333 .98 1.16 1.06 1.17 1.00 1.06 .80 1.01 1.17 1.34 .95 .80 11117777 BBBBoooorrrrrrrroooowwwwiiiinnnnggggssss ffffrrrroooommmm tttthhhheeee FFFFeeeeddddeeeerrrraaaallll RRRReeeesssseeeerrrrvvvveeee .19 .12 .08 .21 .47 .49 .38 .25 .21 .14 .06 .07 1. Latest monthly and biweekly figures are available from the Board's H.3 (502) 8. To adjust required reserves for discontinuities that are due to regulatory changes in weekly statistical release. Historical data starting in 1959 and estimates of the impact on reserve requirements, a multiplicative procedure is used to estimate what required required reserves of changes in reserve requirements are available from the Money and reserves would have been in past periods had current reserve requirements been in effect. Reserves Projections Section, Division of Monetary Affairs, Board of Governors of the Break-adjusted required reserves include required reserves against transactions deposits Federal Reserve System, Washington, DC 20551. and nonpersonal time and savings deposits (but not reservable nondeposit liabilities). 2. Figures reflect adjustments for discontinuities, or "breaks," associated with regula- 9. The break-adjusted monetary base equals (1) break-adjusted total reserves (line 6), tory changes in reserve requirements. (See also table 1.10) plus (2) the (unadjusted) currency component of the money stock, plus (3) (for all 3. Seasonally adjusted, break-adjusted total reserves equal seasonally adjusted, break- quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault adjusted required reserves (line 4) plus excess reserves (line 16). Cash" and for all those weekly reporters whose vault cash exceeds their required 4. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally ad- reserves) the break-adjusted difference between current vault cash and the amount applied justed, break-adjusted total reserves (line 1) less total borrowings of depository institu- to satisfy current reserve requirements. tions from the Federal Reserve (line 17). 10. Reflects actual reserve requirements, including those on nondeposit liabilities, with 5. Extended credit consists of borrowing at the discount window under no adjustments to eliminate the effects of discontinuities associated with regulatory the terms and conditions established for the extended credit program to help depository changes in reserve requirements. institutions deal with sustained liquidity pressures. Because there is not the same need to 11. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy repay such borrowing promptly as with traditional short-term adjustment credit, the reserve requirements. money market impact of extended credit is similar to that of nonborrowed reserves. 12. The monetary base, not break-adjusted and not seasonally adjusted, consists of (1) 6. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally total reserves (line 11), plus (2) required clearing balances and adjustments to compensate adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally adjusted currency for float at Federal Reserve Banks, plus (3) the currency component of the money stock, component of the money stock, plus (3) (for all quarterly reporters on the "Report of plus (4) (for all quarterly reporters on the "Report of Transaction Accounts, Other Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters Deposits and Vault Cash" and for all those weekly reporters whose vault cash exceeds whose vault cash exceeds their required reserves) the seasonally adjusted, break-adjusted their required reserves) the difference between current vault cash and the amount applied difference between current vault cash and the amount applied to satisfy current reserve to satisfy current reserve requirements. Since the introduction of contemporaneous reserve requirements. requirements in February 1984, currency and vault cash figures have been measured over 7. Break-adjusted total reserves equal break-adjusted required reserves (line 9) plus the computation periods ending on Mondays. excess reserves (line 16). 13. Unadjusted total reserves (line 11) less unadjusted required reserves (line 14). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Financial Statistics • June 1995 1.21 MONEY STOCK, LIQUID ASSETS, AND DEBT MEASURES1 Billions of dollars, averages of daily figures 1994r 1995 I-tem D 19 e 9 c 1 . D 19 e 9 c 2 . D 19 e 9 c 3 . D 19 e 9 c 4 .r Dec. Jan. Feb. Mar. Seasonally adjusted Measures2 1 Ml 897.3 1,024.4 1,128.6 1,147.8 1,147.8 1,148.8 1,147.1 1,147.8 2 M2 3,457.9 3,515.3 3,583.6 3,614.5 3,614.5 3,626.6 3,623.5 3,632.3 3 M3 4,176.0 4,182.9 4,242.5 4,303.6 4,303.6 4,326.5 4,334.9 4,356.7 4 L 4,990.9 5,061.1 5,150.3 5,287.0 5,287.0 5,319.2 5,373.4 n.a. 5 Debt 11,171.1 11,706.1 12,335.3 12,965.0 12,965.0 13,024.0 13,102.2 n.a. Ml components 6 Currency3 267.4 292.8 322.1 354.5 354.5 357.7 358.8 362.5 7 Travelers checks4 7.7 8.1 7.9 8.4 8.4 8.4 8.4 8.8 8 Demand deposits5 289.5 338.9 383.9 382.0 382.0 383.5 384.1 383.4 9 Other checkable deposits6 332.7 384.6 414.7 402.9 402.9 399.3r 395.8r 393.1 Nontransaction components 10 In M27 2,560.6 2,490.9 2,455.0 2,466.7 2,466.7 2,477.7r 2,476.4 2,484.5 11 In M38 only 718.1 667.6 658.9 689.1 689.1 699.9r 711.4r 724.4 Commercial banks 12 Savings deposits, including MMDAs 665.6 754.7 785.8 752.3 752.3 744.2 734.4 723.7 13 Small time deposits 602.5 508.1 468.6 502.4 502.4 512.6 524.3 538.3 14 Large time deposits10, 11 333.3 286.7 271.2 298.0 298.0 296.0r 302. lr 305.9 Thrift institutions 15 Savings deposits, including MMDAs 375.6 428.9 429.8 391.9 391.9 385.6r 377.7r 371.6 16 Small time deposits9 464.1 361.1 316.5 317.2 317.2 322.5r 330.7r 339.8 17 Large time deposits10 83.3 67.1 61.6 64.3 64.3 66.1 67.6 69.6 Money market mutual funds 18 General purpose and broker-dealer 374.2 356.9 360.1 389.0 389.0 392.2r 391.8r 391.4 19 Institution-only 180.0 200.2 198.1 180.8 180.8 186.3 180.4 189.0 Debt components 20 Federal debt 2,763.3 3,067.9 3,328.0 3,497.4 3,497.4 3,504.7 3,536.0 n.a. 21 Nonfederal debt 8,407.8 8,638.1 9,007.3 9,467.6 9,467.6 9,519.3r 9,566.2 n.a. Not seasonally adjusted Measures2 22 Ml 916.0 1,046.0 1,153.7 1,173.5 1,173.5 1,158.5 l,134.2r 1,138.0 23 M2 3,472.7 3,533.6 3,606.1 3,638.0 3,638.0 3,633.0* 3,609.8 3,630.3 24 M3 4,189.4 4,201.4 4,266.3 4,329.6 4,329.6 4,336. lr 4,323.6r 4,352.6 25 L 5,015.5 5,090.8 5,184.9 5,324.5 5,324.5 5,342.2r 5,365.1 n.a. 26 Debt 11,168.5 11,708.9 12,327.4 12,956.8 12,956.8 12,998.8' 13,049.2 n.a. Ml components 27 Currency3 269.9 295.0 324.8 357.6 357.6 355.9 357.lr 361.4 28 Travelers checks4 7.4 7.8 7.6 8.1 8.1 8.1 8.1 8.4 29 Demand deposits5 302.4 354.4 401.8 400.1 400.1 388.8 375.0 374.2 30 Other checkable deposits6 336.3 388.9 419.4 407.6 407.6 405.7 394.0 394.0 Nontransaction components 31 In M27 2,556.6 2,487.7 2,452.4 2,464.6 2,464.6 2,474.6r 2,475.6r 2,492.3 32 In M38 716.7 667.7 660.2 691.6 691.6 703. lr 713.9" 722.3 Commercial banks 33 Savings deposits, including MMDAs 664.0 752.9 784.3 751.1 751.1 739.6 730.0 723.7 34 Small time deposits9 601.9 507.8 468.2 502.0 502.0 513.1 524.4 538.1 35 Large time deposits10' " 332.6 286.2 270.8 297.7 297.7 294.7r 300.6r 303.9 Thrift institutions 36 Savings deposits, including MMDAs 374.8 427.9 429.0 391.2 391.2 383.2r 375.4r 371.6 37 Small time deposits9 463.7 360.9 316.2 316.9 316.9 322.8r 330.8r 339.7 38 Large time deposits10 83.1 67.0 61.5 64.3 64.3 65.8 67.2 69.1 Money market mutual funds 39 General purpose and broker-dealer 372.2 355.1 358.3 387.1 387.1 392.9' 396.7 400.3 40 Institution-only 180.8 201.7 200.0 183.1 183.1 192.4 188.8 190.8 Repurchase agreements and Eurodollars 41 Overnight and continuing 79.9 83.2 96.5 116.2 116.2 123.lr 118.4r 118.8 42 Term 132.7 127.8 144.1 159.0 159.0 164.0* 170.5r 171.2 Debt components 43 Federal debt 2,765.0 3,069.8 3,329.5 3,499.0 3,499.0 3,499.0 3,525.1 n.a. 44 Nonfederal debt 8,403.5 8,639.1 8,997.9 9,457.7 9,457.7 9,499.8r 9,524.1 n.a. Footnotes appear on following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary and Credit Aggregates A15 NOTES TO TABLE 1.21 1. Latest monthly and weekly figures are available from the Board's H.6 (508) short-term Treasury securities, commercial paper, and bankers acceptances, each seasonweekly statistical release. Historical data starting in 1959 are available from the Money ally adjusted separately, and then adding this result to M3. and Reserves Projections Section, Division of Monetary Affairs, Board of Governors of Debt: The debt aggregate is the outstanding credit market debt of the domestic the Federal Reserve System, Washington, DC 20551. nonfinancial sectors—the federal sector (U.S. government, not including government- 2. Composition of the money stock measures and debt is as follows: sponsored enterprises or federally related mortgage pools) and the nonfederal sectors Ml: (1) currency outside the US. Treasury, Federal Reserve Banks, and the vaults of (state and local governments, households and nonprofit organizations, nonfinancial corpodepository institutions, (2) travelers checks of nonbank issuers, (3) demand deposits at all rate and nonfarm noncorporate businesses, and farms). Nonfederal debt consists of commercial banks other than those owed to depository institutions, the U.S. government, mortgages, tax-exempt and corporate bonds, consumer credit, bank loans, commercial and foreign banks and official institutions, less cash items in the process of collection and paper, and other loans. The data, which are derived from the Federal Reserve Board's flow Federal Reserve float, and (4), other checkable deposits (OCDs), consisting of negotiable of funds accounts, are break-adjusted (that is, discontinuities in the data have been order of withdrawal (NOW) and automatic transfer service (ATS) accounts at depository smoothed into the series) and month-averaged (that is, the data have been derived by institutions, credit union share draft accounts, and demand deposits at thrift institutions. averaging adjacent month-end levels). Seasonally adjusted Ml is computed by summing currency, travelers checks, demand 3. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of deposideposits, and OCDs, each seasonally adjusted separately. tory institutions. M2: Ml plus (1) overnight (and continuing contract) repurchase agreements (RPs) 4. Outstanding amount of U.S. dollar-denominated travelers checks of nonbank issued by all depository institutions and overnight Eurodollars issued to U.S. residents by issuers. Travelers checks issued by depository institutions are included in demand foreign branches of U.S. banks worldwide, (2) savings (including MMDAs) and.small deposits. time deposits (time deposits—including retail RPs—in amounts of less than $100,000), 5. Demand deposits at commercial banks and foreign-related institutions other than and (3) balances in both taxable and tax-exempt general-purpose and broker-dealer those owed to depository institutions, the U.S. government, and foreign banks and official money market funds. Excludes individual retirement accounts (IRAs) and Keogh balances institutions, less cash items in the process of collection and Federal Reserve float. at depository institutions and money market funds. Also excludes all balances held by 6. Consists of NOW and ATS account balances at all depository institutions, credit U.S. commercial banks, money market funds (general purpose and broker-dealer), foreign union share draft account balances, and demand deposits at thrift institutions. governments and commercial banks, and the U.S. government. Seasonally adjusted M2 is 7. Sum of (1) overnight RPs and overnight Eurodollars, (2) money market fund computed by adjusting its non-Mi component as a whole and then adding this result to balances (general purpose and broker-dealer), (3) savings deposits (including MMDAs), seasonally adjusted Ml. and (4) small time deposits. M3: M2 plus (1) large time deposits and term RP liabilities (in amounts of $100,000 or 8. Sum of (1) large time deposits, (2) term RPs, (3) term Eurodollars of U.S. residents, more) issued by all depository institutions, (2) term Eurodollars held by U.S. residents at and (4) money market fund balances (institution-only), less (5) a consolidation adjustment foreign branches of U.S. bilks worldwide and at all banking offices in the United that represents the estimated amount of overnight RPs and Eurodollars held by institution- Kingdom and Canada, and (3) balances in both taxable and tax-exempt, institution-only only money market funds. money market funds. Excludes amounts held by depository institutions, the U.S. govern- 9. Small time deposits—including retail RPs—are those issued in amounts of less ment, money market funds, and foreign banks and official institutions. Also excluded is than $100,000. All IRAs and Keogh accounts at commercial banks and thrift institutions the estimated amount of overnight RPs and Eurodollars held by institution-only money are subtracted from small time deposits. market funds. Seasonally adjusted M3 is computed by adjusting its non-M2 component as 10. Large time deposits are those issued in amounts of $100,000 or more, excluding a whole and then adding this result to seasonally adjusted M2. those booked at international banking facilities. L: M3 plus the nonbank public holdings of U.S. savings bonds, short-term Treasury 11. Large time deposits at commercial banks less those held by money market funds, securities, commercial paper, and bankers acceptances, net of money market fund hold- depository institutions, the U.S. government, and foreign banks and official institutions. ings of these assets. Seasonally adjusted L is computed by summing U.S. savings bonds, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.22 DEPOSIT INTEREST RATES AND AMOUNTS OUTSTANDING Commercial and BIF-insured saving banks1 1994 1995 IItteemm D 19 e 9 c 2 . D 19 e 9 c 3 . July Aug. Sept. Oct. Nov. Dec. Jan. Feb.r Mar. Interest rates (annual effective yields)2 INSURED COMMERCIAL BANKS 1 Negotiable order of withdrawal accounts 2.33 1.86 1.83 1.85 1.87 1.88 1.92 1.96 1.98 2.01 2.00 2 Savings deposits3 2.88 2.46 2.57 2.63 2.67 2.72 2.81 2.91 2.98 3.09 3.13 Interest-bearing time deposits with balances of less than $100,000, by maturity 3 7 to 91 days 2.90 2.65 3.17 3.29 3.36 3.47 3.65 3.81 3.96 4.19 4.23 4 92 to 182 days 3.16 2.91 3.44 3.61 3.75 3.93 4.22 4.44 4.67 4.83 4.94 5 183 days to 1 year 3.37 3.13 3.88 4.11 4.27 4.50 4.85 5.12 5.39 5.57 5.60 6 More than 1 year to 2 V5 years 3.88 3.55 4.39 4.61 4.80 5.08 5.42 5.74 6.00 6.12 6.12 7 More than lV2 years 4.77 4.29 5.14 5.33 5.47 5.77 6.09 6.30 6.47 6.52 6.47 BIF-INSURED SAVINGS BANKS4 8 Negotiable order of withdrawal accounts 2.45 1.87 1.89 1.89 1.91 1.88 1.91 1.95 1.99 2.04 2.00 9 Savings deposits3 3.20 2.63 2.67 2.74 2.78 2.76 2.83 2.88 2.91 2.95 2.94 Interest-bearing time deposits with balances of less than $100,000, by maturity 10 7 to 91 days 3.13 2.70 2.98 3.03 3.11 3.32 3.51 3.80 3.98 4.17 4.22 11 92 to 182 days 3.44 3.02 3.53 3.69 3.87 4.10 4.42 4.89 5.13 5.33 5.38 12 183 days to 1 year 3.61 3.31 4.02 4.24 4.47 4.80 5.18 5.52 5.75 5.94 5.95 13 More than 1 year to 2]/i years 4.02 3.66 4.56 4.83 5.04 5.39 5.70 6.09 6.29 6.37 6.32 14 More than 2 V2 years 5.00 4.62 5.35 5.47 5.64 5.79 6.18 6.43 6.68 6.75 6.68 Amounts outstanding (millions of dollars) INSURED COMMERCIAL BANKS 15 Negotiable order of withdrawal accounts 286,541 305,223 290,631 295,320 286,787 294,072 294,282 303,724 291,355 290,188 292,877 16 Savings deposits3 738,253 766,413 765,751 764,035 755,249 751,183 746,605 734,519 723,295 714,955 713,012 17 Personal 578,757 597,838 605,881 600,892 595,175 590,875 584,628 578,459 569,619 564,877 564,743 18 Nonpersonal 159,496 168,575 159,870 163,143 160,074 160,308 161,977 156,060 153,676 150,078 148,269 Interest-bearing time deposits with balances of less than $100,000, by maturity 19 7 to 91 days 38,474 29,455 28,659 27,959 28,312 31,447 31,077 32,375 32,154 31,777 31,364 20 92 to 182 days 127,831 110,069 100,424 98,085 96,398 95,359 94,692 95,901 96,895 98,248 96,500 21 183 days to 1 year 163,098 146,565 152,216 155,964 157,253 158,753 159,645 161,831 163,939 169,103 176,093 22 More than 1 year to 2l/2 years 152,977 141,223 146,875 150,807 152,514 155,111 158,382 162,486 168,515 176,877 184,427 23 More than 2vi years 169,708 181,528 182,944 186,490 190,209 188,479 189,741 190,897 190,215 191,383 194,030 24 IRA and Keogh plan deposits 147,350 143,985 142,649 142,617 142,700 142,896 143,075 143,428 143,900 145,040 145,814 BIF-INSURED SAVINGS BANKS4 25 Negotiable order of withdrawal accounts 10,871 11,151 10,925 11,016 10,769 11,120 11,002 11,317 11,127 10,950 11,301 26 Savings deposits3 81,786 80,115 77,337 75,108 74,659 73,416 72,622 70,642 71,639 69,982 68,986 27 Personal 78,695 77,035 74,064 72,040 71,525 70,215 69,412 67,673 68,760 67,144 66,045 28 Nonpersonal 3,091 3,079 3,273 3,068 3,134 3,201 3,211 2,969 2,878 2,837 2,941 Interest-bearing time deposits with balances of less than $100,000, by maturity 29 7 to 91 days 3,867 2,793 2,531 2,523 2,402 2,245 2,209 2,166 2,041 2,086 1,971 30 92 to 182 days 17,345 12,946 12,511 12,292 12,276 11,987 11,913 11,793 12,084 11,953 11,882 31 183 days to 1 year 21,780 17,426 17,591 17,593 17,928 18,123 18,509 18,753 19,336 19,979 20,613 32 More than 1 year to 2Vl years 18,442 16,546 16,901 16,824 17,287 17,519 17,999 17,842 20,460 21,870 22,916 33 More than 2xh years 18,845 20,464 21,573 21,531 21,923 21,624 21,687 21,600 21,888 22,275 22,511 34 IRA and Keogh plan accounts 21,713 19,356 19,757 19,445 19,532 19,550 19,532 19,325 19,802 20,099 20,231 1. BIF, Bank Insurance Fund. Data in this table also appear in the Board's H.6 (508) 2. As of October 31, 1994, interest rate data for NOW accounts and savings deposits Special Supplementary Table monthly statistical release. For ordering address, see inside reflect a series break caused by a change in the survey used to collect these data. front cover. Estimates are based on data collected by the Federal Reserve System from a 3. Includes personal and nonpersonal money market deposits. stratified random sample of about 425 commercial banks and 75 savings banks on the last 4. Includes both mutual and federal savings banks. day of each month. Data are not seasonally adjusted and include IRA and Keogh deposits and foreign currency-denominated deposits. Data exclude retail repurchase agreements and deposits held in US. branches and agencies of foreign banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary and Credit Aggregates A17 1.23 BANK DEBITS AND DEPOSIT TURNOVER1 Debits are in billions of dollars; turnover is ratio o fdebits to deposits; monthly data are at annual rates 1994 1995 BBaannkk ggrroouupp,, oorr ttyyppee ooff ddeeppoossiitt Aug. Sept. Oct.' Nov.r Dec.r Jan. DEBITS Seasonally adjusted Demand deposits3 1 All insured banks 313,128.1 334,245.6 367,129.2 380,282.1 368,276.6 352,375.9 369,211.3 371,048.0 365,025.2 2 Major New York City banks 165,447.7 171,227.3 191,169.8 195,568.2 186,074.2 179,396.2 186,350.6 187,955.6 183,419.9 3 Other banks 147,680.4 163,018.3 175,959.4 184,713.9 182,202.4 172,979.7 182,860.7 183,092.4 181,605.4 4 Other checkable deposits4 3,780.3 3,467.1 3,831.4 3,890.7 3,905.1 3,896.7 4,116.4 4,199.0 4,058.6 5 Savings deposits (including MMDAs)5 3,309.1 3,508.8 3,737.1 3,862.2 3,760.0 3,639.6 3,835.7 4,033.1 3,856.4 DEPOSIT TURNOVER Demand deposits3 6 All insured banks 825.9 785.3 813.0 842.1 815.5 783.6 826.5 820.6 808.6 7 Major New York City banks 4,795.3 4,198.1 4,481.6 4,608.4 4,502.1 4,414.6 4,544.7 4,490.8 4,337.8 8 Other banks 428.7 423.6 430.3 451.5 444.1 422.9 450.7 446.3 443.9 9 Other checkable deposits4 14.4 11.8 12.8 12.9 13.0 13.0 13.9 14.2 13.8 10 Savings deposits (including MMDAs)5 4.7 4.6 4.9 5.0 4.9 4.8 5.1 5.4 5.3 DEBITS Not seasonally adjusted Demand deposits3 11 All insured banks 313,344.9 334,354.6 367,218.8 394,394.4 365,063.0 352,548.5 359,229.9 384,218.7 364,000.9 12 Major New York City banks 165,595.0 171,283.5 191,226.1 202,845.6 186,161.8 181,406.6 184,656.3 194,120.1 181,602.7 13 Other banks 147,749.9 163,071.0 175,992.8 191,548.8 178,901.2 171,141.8 174,573.5 190,098.6 182,398.1 14 Other checkable deposits4 3,783.6 3,467.5 3,827.9 3,861.2 3,960.9 3,797.1 3,845.9 4,365.1 4,406.7 15 Savings deposits (including MMDAs)5 3,310.0 3,509.5 3,734.9 3,873.3 3,716.4 3,472.2 3,640.4 4,244.8 4,031.3 DEPOSIT TURNOVER Demand deposits3 16 All insured banks 826.1 785.4 813.8 889.5 811.9 774.5 785.9 814.9 789.7 17 Major New York City banks 4,803.5 4,197.9 4,490.3 4,960.2 4,539.5 4,435.8 4,391.6 4,343.4 4,128.2 18 Other banks 428.8 423.8 430.6 475.9 437.8 413.1 420.6 445.4 437.5 19 Other checkable deposits4 14.4 11.8 12.7 13.0 13.3 12.9 13.0 14.5 14.6 20 Savings deposits (including MMDAs)5 4.7 4.6 4.9 5.0 4.9 4.6 4.8 5.7 5.5 1. Historical tables containing revised data for earlier periods can be obtained from the 4. As of January 1994, other checkable deposits (OCDs), previously defined as Publications Section, Division of Support Services, Board of Governors of the Federal automatic transfer to demand deposits (ATSs) and negotiable order of withdrawal (NOW) Reserve System, Washington, DC 20551. accounts, were expanded to include telephone and preauthorized transfer accounts. This Data in this table also appear in the Board's G.6 (406) monthly statistical release. For change redefined OCDs for debits data to be consistent with OCDs for deposits data. ordering address, see inside front cover. 5. Money market deposit accounts. 2. Annual averages of monthly figures. 3. Represents accounts of individuals, partnerships, and corporations and of states and political subdivisions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Financial Statistics • June 1995 1.26 ASSETS AND LIABILITIES OF COMMERCIAL BANKS1 Billions of dollars Monthly averages Wednesday figures Account 1994r 1995r 1995 Mar. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Mar. 8 Mar. 15 Mar. 22 Mar. 29 ALL COMMERCIAL Seasonally adjusted BANKING INSTITUTIONS Assets 1 Bank credit 3,176.2 3,281.4 3,290.6 3,300.5 3,319.7 3,351.6 3,363.7 3,386.2 3,374.2 3,385.8 3,386.6 3,392.7 2 Securities in bank credit 953.1 967.4 959.3 952.3 948.3 946.6 938.1 940.3 937.3 943.5 938.3 940.4 3 U.S. government securities 746.2 741.1 731.7 724.2 720.1 721.2 716.4 704.2 706.9 708.0 701.3 699.3 4 Other securities 206.9 226.4 227.6 228.1 228.2 225.4 221.7 236.1 230.4 235.5 237.0 241.1 5 Loans and leases in bank credit2 ... 2,223.1 2,313.9 2,331.4 2,348.2 2,371.4 2,405.0 2,425.6 2,445.9 2,436.9 2,442.3 2,448.3 2,452.3 6 Commercial and industrial 597.2 628.3 634.7 641.0 646.3 659.1 671.0* 674.6 671.5 675.1 675.5 675.3 7 Real estate 944.2 980.8 985.8 991.1 999.0 1,014.1 1,021.7 1,026.9 1,024.5 1,025.5 1,028.4 1,028.5 8 Revolving home equity 73.3 74.9 75.1 75.7 76.2 76.6 76.9 76.8 76.6 76.7 76.8 77.0 9 Other 870.9 905.9 910.6 915.4 922.8 937.4 944.8 950.1 947.8 948.8 951.5 951.5 10 Consumer 402.4 434.5 440.8 443.7 449.0 453.7 454.8 460.0 458.1 458.6 459.8 462.7 11 Security3 84.3 69.7 71.2 71.8 73.9 72.0 70.8 73.1 70.1 71.3 74.8 75.1 12 Other 195.0 200.6 198.9 200.6 203.3 206.2 207.2* 211.3 212.8 211.8 209.9 210.7 13 Interbank loans4 149.7 161.7 165.8 173.0 176.3 180.0 178.8 181.1 173.8 189.4 176.9 185.5 14 Cash assets5 217.1 203.2 209.2 205.7 208.3 218.5 216.3 208.1 204.3 222.9 203.4 200.4 15 Other assets6 217.2 221.3 220.8 222.7 233.4 245.1 251.2' 254.4 257.1 252.0 253.4 249.1 16 Total assets7 3,702.9 3,810.7 3,829.6 3,845.4 3,881.0 3,937.9* 3,952.9 3,972Jj 3,952Ji 3,9933 3,963.6 3,970.5 Liabilities 17 Deposits 2,515.9 2,517.8 2,526.8 2,522.9 2,528.8 2,544.1 2,546.9 2,547.6 2,540.0 2,570.8 2,542.5 2,535.1 18 Transaction 813.8 803.6 804.7 796.7 795.8 806.6 802.8 793.5 787.8 816.4 788.7 778.3 19 Nontransaction 1,702.1 1,714.2 1,722.2 1,726.1 1,733.0 1,737.5 1,744.1 1,754.2 1,752.2 1,754.3 1,753.8 1,756.8 20 Large time 333.8 346.5 353.8 357.7 360.5 364.7 372.0 378.4 378.3 378.2 378.7 379.2 21 Other 1,368.3 1,367.7 1,368.3 1,368.4 1,372.6 1,372.8 1,372.1 1,375.7 1,373.9 1,376.2 1,375.2 1,377.6 22 Borrowings 549.7 579.7 583.7 591.2 607.0 640.1 642.7 648.5 628.3 652.6 651.5 660.5 23 From banks in the U.S 150.8 160.5 165.7 170.1 178.0 182.2 179.7 183.0 172.0 192.3 177.6 191.2 24 From nonbanks in the U.S 398.9 419.2 418.1 421.1 429.1 457.9 463.0 465.5 456.4 460.3 473.9 469.3 25 Net due to related foreign offices 162.6 209.7 214.6 213.4 225.5 244.9 252.6 241.4 248.0 245.8 238.5 234.0 26 Other liabilities8 170.3 177.9 179.9 180.5 189.6 185.2 189.5* 207.4 207.4 205.0 206.1 207.2 27 Total liabilities 3,3984 3,485.0 3,505.1 3,508.0 3,550.9 3,614.2 3,631.8* 3,644.9 3,623.7 3,674.2 3,6385 3,636.7 28 Residual (assets less liabilities)9 304.5 325.6 324.5 337.4 330.1 323.7 321.1* 327.9 329.1 319.0 325.1 333.8 Not seasonally adjusted Assets 29 Bank credit 3,177.0 3,280.3 3,291.0 3,308.9 3,336.0 3,348.0 3,359.7 3,386.7 3,380.6 3,390.5 3,383.1 3,387.1 30 Securities in bank credit 960.0 965.8 958.1 953.6 943.4 940.6 936.8 948.0 947.8 952.1 944.3 945.9 31 U.S. government securities 751.5 743.5 731.1 725.2 718.9 715.0 712.0 709.2 710.9 713.4 706.7 704.7 32 Other securities 208.5 222.2 227.0 228.5 224.6 225.6 224.8 238.8 236.9 238.7 237.6 241.1 33 Loans and leases in bank credit2 ... 2,217.0 2,314.5 2,332.9 2,355.3 2,392.6 2,407.4 2,422.9 2,438.7 2,432.8 2,438.3 2,438.8 2,441.2 34 Commercial and industrial 600.1 624.8 632.6 641.0 647.0 655.8 669.6* 677.8 673.5 678.4 679.1 678.9 35 Real estate 939.8 982.1 988.4 995.9 1,005.4 1,012.4 1,017.8 1,022.0 1,020.2 1,021.2 1,022.3 1,023.7 36 Revolving home equity 72.7 75.2 75.8 76.1 76.2 76.6 76.5 76.1 76.1 76.1 76.1 76.1 37 Other 867.2 906.9 912.6 919.8 929.2 935.8 941.3 945.9 944.1 945.1 946.3 947.6 38 Consumer 399.5 435.5 440.8 443.9 453.9 458.4 456.0 456.6 455.1 455.4 456.3 458.6 39 Security3 85.8 68.4 71.0 73.5 78.9 74.5 74.2 74.3 73.2 75.0 76.0 72.8 40 Other 191.8 203.7 200.0 201.0 207.3 206.4 205.1* 207.9 210.7 208.3 205.1 207.1 41 Interbank loans4 148.4 158.8 164.0 174.6 187.1 186.9 180.9 179.3 176.2 189.5 169.8 180.5 42 Cash assets5 211.0 204.6 209.7 212.2 222.1 223.9 212.9* 202.4 196.2 219.6 193.9 197.1 43 Other assets6 213.3 221.8 222.6 225.5 239.4 245.0 248.9* 249.4 253.0 247.0 246.0 245.0 44 Total assets7 3,692.1 3,8084 3,830.6 3,8645 3,9275 3,946.9 3,945.3* 3,960.7 3,948£ 3,9893 3,935.6 3,952.6 Liabilities 45 Deposits 2,506.2 2,514.6 2,522.4 2,537.9 2,561.5 2,548.0 2,537.7 2,538.1 2,537.7 2,564.3 2,516.4 2,521.9 46 Transaction 801.8 800.9 801.9 810.9 831.4 816.9 794.0 781.3 781.1 806.3 760.8 765.2 47 Nontransaction 1,704.5 1,713.7 1,720.4 1,727.0 1,730.1 1,731.1 1,743.7 1,756.7 1,756.6 1,758.0 1,755.6 1,756.7 48 Large time 335.0 346.4 351.7 356.9 359.0 361.5 372.2 379.6 379.7 380.3 380.3 379.7 49 Other 1,369.4 1,367.3 1,368.7 1,370.1 1,371.1 1,369.6 1,371.5 1,377.1 1,376.9 1,377.7 1,375.3 1,377.0 50 Borrowings 543.0 589.5 591.5 604.2 619.7 633.4 639.1* 637.9 626.2 645.7 639.1 639.0 51 From banks in the U.S 148.8 158.6 163.7 174.4 187.1 186.9 180.9 179.3 176.2 189.5 169.8 180.5 52 From nonbanks in the U.S 394.3 430.9 427.8 429.9 432.7 446.4 458.1 458.5 450.0 456.1 469.3 458.5 53 Net due to related foreign offices 165.3 204.2 214.4 213.3 230.4 251.6 249.7 245.1 243.8 244.2 245.2 251.5 54 Other liabilities8 169.9 177.6 181.8 185.7 192.8 188.2 190.3* 206.4 208.4 204.6 203.0 206.4 55 Totai liabilities 3,3845 3/185.9 3,510.0 3,541.1 3,6044 3,621.2 3,616.7r 3,6275 3,615.9 3,658£ 3,603.6 3,618.7 56 Residual (assets less liabilities)9 307.7 322.5 320.6 323.3 323.1 325.7 328.6* 333.2 332.9 330.6 331.9 333.8 Footnotes appear on following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions A19 1.26 ASSETS AND LIABILITIES OF COMMERCIAL BANKS1—Continued Billions of dollars Monthly averages Wednesday figures Account 1994r 1995r 1995 Mar. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Mar. 8 Mar. 15 Mar. 22 Mar. 29 DOMESTICALLY CHARTERED Seasonally adjusted COMMERCIAL BANKS Assets 57 Bank credit 2,836.2 2,928.0 2,939.2 2,947.8 2,962.1 2,991.8 2,994.0 3,012.2 3,002.7 3,013.3 3,011.9 3,016.5 58 Securities in bank credit 875.9 881.8 875.5 871.2 868.8 864.1 848.1 851.6 849.5 855.1 851.1 850.2 59 U.S. government securities 689.3 681.1 674.5 670.2 668.5 667.4 655.9 645.4 648.3 649.1 644.1 639.8 60 Other securities 186.6 200.6 201.0 200.9 200.3 196.7 192.3 206.2 201.1 205.9 207.0 210.4 61 Loans and leases in bank credit2 1,960.3 2,046.2 2,063.7 2,076.6 2,093.4 2,127.7 2,145.9 2,160.7 2,153.2 2,158.2 2,160.8 2,166.3 6? 444.8 469.6 473.8 476.8 480.1 491.3 498.3 501.8 499.2 501.9 501.8 503.1 63 Real estate 899.0 938.5 944.2 949.8 957.8 973.5 981.6 987.3 984.8 985.7 988.4 989.6 64 Revolving home equity 73.2 74.9 75.1 75.7 76.2 76.6 76.9 76.8 76.6 76.7 76.8 77.0 65 Other 825.7 863.6 869.1 874.1 881.6 896.8 904.7 910.5 908.1 909.0 911.6 912.6 66 402.4 434.5 440.8 443.7 449.0 453.7 454.8 460.0 458.1 458.6 459.8 462.7 67 55.9 43.6 45.6 46.2 45.7 45.8 46.8 46.2 45.9 46.2 46.5 45.6 68 Other 158.2 160.1 159.2 160.2 160.8 163.4 164.4 165.4 165.3 165.9 164.3 165.4 69 Interbank loans4 125.9 138.2 141.2 149.8 153.4 156.8 156.9 158.2 150.9 166.0 156.2 160.0 70 191.3 180.8 185.2 181.2 181.3 191.5 190.8 182.3 178.7 196.8 178.1 174.2 71 Other assets6 169.9 167.3 165.8 166.4 169.7 175.1 177.0 172.5 173.7 172.9 172.7 167.1 72 Total assets7 3,266.0 3,357.5 3,374.7 3J8&8 3,409.9 3,458.0 3,461.9 3,4684 3,449.3 3,492.1 3,4623 3,460.8 Liabilities 73 Deposits 2,375.5 2,367.8 2,371.1 2,367.3 2,369.8 2,389.1 2,394.5 2,392.8 2,385.7 2,416.6 2,388.5 2,377.9 74 802.9 793.6 794.8 787.1 786.0 797.1 793.1 783.3 778.0 806.2 778.9 767.5 75 Nontransaction 1,572.7 1,574.2 1,576.3 1,580.2 1,583.8 1,592.0 1,601.4 1,609.5 1,607.6 1,610.4 1,609.7 1,610.3 76 Large time 207.6 209.3 212.7r 216.7 217.7 225.0 234.1 238.8 238.5 239.6 238.7 238.9 77 Other 1,365.1 1,364.9 1,363.6 1,363.5 1,366.0 1,367.0 1,367.3 1,370.7 1,369.2 1,370.8 1,371.0 1,371.4 78 Borrowings 448.8 475.5 483.1 488.3 501.0 534.6 533.7 531.7 518.1 531.9 535.0 539.7 79 From banks in the U.S 132.9 143.4 149.4 153.9 161.9 163.8 160.7 163.4 155.7 169.0 157.8 172.4 80 From nonbanks in the U.S 315.8 332.1 333.7 334.4 339.1 370.8 373.0 368.3 362.4 362.9 377.2 367.3 81 Net due to related foreign offices .... 13.3 58.9 65.4 66.4 77.3 91.4 87.9 85.4 83.0 90.0 87.2 84.2 82 Other liabilities8 128.7 133.4 133.5r 133.2 132.8 124.8 126.1 135.9 133.9 134.8 136.0 137.1 83 Total liabilities 2^663 3,035.6 3,053.1r 3,055.1 3,080.9 3,139.9 3,1413 3,145.8 3,120.6 3,1733 3,146.7 3,138.9 84 Residual (assets less liabilities)9 299.7 321.9 321.6r 333.6 329.1 318.1 319.6 322.6 328.8 318.8 315.6 321.9 Not seasonally adjusted Assets 85 Bank credit 2,835.6 2,928.7 2,941.2 2,955.8 2,969.5 2,982.7 2,989.4 3,011.5 3,007.1 3,013.4 3,007.3 3,012.5 86 Securities in bank credit 881.8 880.6 873.9 871.7 862.3 856.6 847.3 858.3 858.7 862.0 855.7 855.8 87 U.S. government securities 693.7 684.0 673.7 670.0 665.2 659.9 652.7 649.7 652.1 653.5 648.2 645.0 88 Other securities 188.1 196.6 200.3 201.7 197.1 196.7 194.6 208.6 206.6 208.5 207.5 210.8 89 Loans and leases in bank credit2 1,953.8 2,048.0 2,067.3 2,084.1 2,107.2 2,126.1 2,142.1 2,153.2 2,148.5 2,151.5 2,151.6 2,156.7 90 Commercial and industrial 447.2 466.5 472.7 476.9 479.8 487.8 497.8 504.5 501.4 504.5 504.9 505.9 91 Real estate 894.6 939.6 946.9 954.4 964.2 971.9 977.6 982.4 980.3 981.2 982.3 985.0 9? Revolving home equity 72.6 75.2 75.8 76.1 76.2 76.6 76.5 76.1 76.1 76.1 76.1 76.1 P3 Other 822.0 864.4 871.1 878.3 888.0 895.3 901.1 906.3 904.2 905.1 906.2 908.9 94 Consumer 399.5 435.5 440.8 443.9 453.9 458.4 456.0 456.6 455.1 455.4 456.3 458.6 95 56.8 43.7 46.1 47.4 46.2 45.2 48.1 46.9 48.0 47.3 47.3 44.7 96 Other 155.8 162.7 160.8 161.5 163.1 162.8 162.6 162.8 163.7 163.0 160.8 162.5 9977 125.6 134.8 138.5 151.6 161.8 162.3 160.0 157.6 155.2 166.8 150.8 155.6 9988 185.8 181.0 184.9 187.8 194.9 197.4 188.4 177.3 171.6 194.1 169.2 171.0 99 Other assets6 167.1 168.7 168.0 168.0 172.0 174.5 174.7 169.4 170.1 169.1 168.6 165.5 100 Total assets7 3,256.6 3,356.2 3376.1 3,406.6 3,4413 3,460.1 3,455.4 3y458JS 3,447.0 3,486.2 3,438.7 3,447.5 Liabilities 101 2,364.1 2,365.2 2,370.3 2,383.9 2,402.6 2,393.4 2,384.6 2,381.2 2,382.5 2,407.9 2,359.4 2,361.4 10? 791.2 790.1 791.9 801.2 821.4 807.2 784.3 771.6 771.8 796.7 751.4 754.6 103 1,572.8 1,575.1 1,578.5 1,582.7 1,581.2 1,586.2 1,600.3 1,609.6 1,610.7 1,611.2 1,608.1 1,606.9 104 Large time 206.7 210.2 213.5 216.9 216.1 222.9 234.4 237.6 238.6 238.7 237.6 236.0 105 Other 1,366.1 1,364.9 1,365.0 1,365.8 1,365.1 1,363.3 1,365.9 1,371.9 1,372.1 1,372.5 1,370.5 1,370.9 106 Borrowings 443.7 484.7 490.8 501.6 512.2 528.8 532.7 522.9 515.4 525.1 524.4 525.6 107 From banks in the U.S 131.0 141.0 148.0 157.6 169.3 167.9 162.4 159.8 159.9 165.4 151.2 161.8 108 From nonbanks in the U.S 312.7 343.7 342.8 344.0 342.9 360.8 370.2 363.2 355.5 359.6 373.2 363.7 109 Net due to related foreign offices.... 16.0 55.5 63.2 64.9 74.3 90.2 88.7 90.1 86.3 92.0 92.5 93.8 110 Other liabilities8 129.1 133.1 136.0 137.7 134.0 126.7 125.8 136.3 134.9 135.6 135.4 137.9 111 Total Uabilities 2952.9 3,03&5 3,0604 3,088.1 3,123.1 3,139.1 3,131.7 3,130.5 3,119.1 3,160.6 3,111.8 3,118.7 112 Residual (assets less liabilities)9 303.7 317.6 315.7r 318.4 318.2 321.0 323.8 328.2 327.9 325.6 327.0 328.8 Footnotes appear on following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 DomesticN onfinancial Statistics • June 1995 NOTES TO TABLE 1.26 1. Covers the following types of institutions in the fifty states and the District of 4. Consists of federal funds sold to, reverse repurchase agreements with, and loans to Columbia: domestically chartered commercial banks that submit a weekly report of commercial banks in the United States. condition (large domestic); other domestically chartered commercial banks (small domes- 5. Includes vault cash, cash items in process of collection, demand balances due from tic); branches and agencies of foreign banks; New York State investment companies, and depository institutions in the United States, balances due from Federal Reserve Banks, Edge Act and agreement corporations (foreign-related institutions). Excludes interna- and other cash assets. tional banking facilities. Data are Wednesday values, or pro rata averages of Wednesday 6. Excludes the due-from position with related foreign offices, which is included in values. Large domestic banks constitute a universe; data for small domestic banks and lines 25, 53, 81, and 109. foreign-related institutions are estimates based on weekly samples and on quarter-end 7. Excludes unearned income, reserves for losses on loans and leases, and reserves for condition reports. Data are adjusted for breaks caused by reclassifications of assets and transfer risk. Loans are reported gross of these items. liabilities. 8. Excludes the due-to position with related foreign offices, which is included in lines 2. Excludes federal funds sold to, reverse repurchase agreements with, and loans to 25, 53, 81, and 109. commercial banks in the United States. 9. This balancing item is not intended as a measure of equity capital for use in capital 3. Consists of reserve repurchase agreements with broker-dealers and loans to pur- adequacy analysis. chase and carry securities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Commercial Banks A21 1.27 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS Millions of dollars, Wednesday figures 1995 AAccccoouunntt Feb. lr Feb. 8r Feb. 15r Feb. 22r Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 ASSETS 1 Cash and balances due from depository institutions 128,719 100,979 121,554 122,838 129,932 106,190 125,045 104,838 106,016 ? U.S. Treasury and government securities 300,435 297,950 299,156 299,190 295,502 297,838 300,048 295,306 291,970 21,059 20,085 24,443 23,035 23,281 25,365 26,306 22,061 19,201 4 279,377 277,865 274,713 276,154 272,221 272,473 273,741 273,245 272,769 5 Mortgage-backed securities 95,979 95,958 94,963 95,911 94,869 95,217 94,371 93,096 92,846 All others, by maturity 6 One year or less 44,882 44,870 44,746 45,306 46,023 46,401 45,796 4466,,559988 4455,,886666 7 One year through five years 75,084 73,464 71,620 71,711 69,015 68,507 71,705 72,127 72,397 8 More than five years 63,431 63,573 63,384 63,226 62,315 62,348 61,869 61,424 61,660 9 108,803 107,356 107,559 110,138 112,120 121,795 123,381 122,865 125,987 in Trading account 2,180 1,916 2,059 1,843 1,858 1,812 1,721 1,561 1,462 11 Investment account 61,339 61,432 61,403 61,060 60,720 60,525 60,317 60,397 60,285 i? State and local government, by maturity 20,622 20,576 20,468 20,432 20,311 20,326 20,269 20,307 20,402 n One year or less 5,561 5,524 5,454 5,455 5,475 5,557 5,505 5,553 5,606 14 More than one year 15,061 15,053 15,013 14,977 14,836 14,769 14,764 14,754 14,796 is Other bonds, corporate stocks, and securities 40,718 40,855 40,935 40,628 40,408 40,199 40,048 40,090 39,884 16 Other trading account assets 45,284 44,008 44,098 47,236 49,543 59,458 61,342 60,907 64,240 17 114,501 106,375 119,278 108,281 119,155 104,567 115,754 103,465 103,143 18 To commercial banks in the United States 82,849 73,986 83,153 73,413 79,993 68,265 81,113 69,309 71,282 19 To nonbank brokers and dealers in securities 25,750 24,406 27,875 28,211 30,870 27,987 27,341 27,724 24,706 ?n To others3 5,902 7,984 8,250 6,657 8,292 8,315 7,299 6,432 7,155 71 Other loans and leases, gross 1,179,809 1,170,979 1,176,197 1,176,305 1,184,836 1,180,286 1,181,666 1,180,668 1,187,229 ?? Commercial and industrial 325,673 325,454 327,763 328,504 332,966 331,151 333,523 333,426 333,347 73 Bankers acceptances and commercial paper 2,525 2,437 2,254 2,224 2,109 2,136 1,945 1,802 1,822 ?4 All other 323,149 323,017 325,509 326,281 330,857 329,015 331,578 331,624 331,525 75 320,987 320,844 323,359 324,155 328,652 326,845 329,392 329,348 329,258 ?6 Non-U. S. addressees 2,162 2,173 2,150 2,126 2,205 2,170 2,186 2,276 2,266 ?7 465,760 465,918 466,309 466,885 468,204 468,119 468,515 468,992 470,200 78 Revolving, home equity 47,173 47,141 47,165 47,153 46,701 46,647 46,652 46,630 46,637 79 All other 418,587 418,777 419,144 419,732 421,502 421,471 421,863 422,362 423,563 30 To individuals for personal expenditures 239,542 237,517 237,875 237,928 237,384 237,066 236,696 237,485 238,412 31 To depository and financial institutions 56,405 54,290 54,444 53,081 54,353 55,167 54,157 52,507 55,606 37 Commercial banks in the United States 36,179 34,617 34,684 34,045 34,685 35,311 34,373 33,395 36,156 33 Banks in foreign countries 2,790 2,203 2,726 2,827 3,188 3,156 3,267 2,776 2,877 34 Nonbank depository and other financial institutions 17,436 17,469 17,034 16,209 16,480 16,700 16,517 16,336 16,573 35 For purchasing and carrying securities 16,034 14,815 15,031 15,149 15,547 14,506 14,469 14,315 14,668 36 To finance agricultural production 6,276 6,233 6,254 6,150 6,185 6,155 6,194 6,257 6,254 37 To states and political subdivisions 11,248 11,160 11,272 11,163 11,204 11,101 11,121 11,050 11,124 38 To foreign governments and official institutions 925 901 938 957 1,091 1,187 864 940 1,017 39 All other loans4 25,539 22,223 23,803 23,897 25,147 22,965 23,189 22,673 23,272 40 Lease-financing receivables 32,407 32,468 32,509 32,591 32,756 32,870 32,938 33,024 33,327 41 LESS: Unearned income 1,771 1,778 1,790 1,797 1,670 1,678 1,673 1,697 1,678 4? Loan and lease reserve5 34,428 34,504 34,527 34,489 34,409 34,541 34,583 34,513 34,408 43 Other loans and leases, net 1,143,611 1,134,698 1,139,880 1,140,019 1,148,758 1,144,068 1,145,409 1,144,458 1,151,143 44 All other assets 145,433 137,121 142,344 135,708 140,559 136,293 135,217 134,906 131,797 45 Total assets6 1,941,503 1,884,479 1,929,772 1,916,174 1,946,025 1,910,752 1,944,853 1,905,836 1,910,056 Footnotes appear on the following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.27 ASSETS AND LIABILITIES OF LARGE WEEKLY REPORTING COMMERCIAL BANKS—Continued Millions of dollars, Wednesday figures 1995 AAccccoouunntt Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 LIABILITIES 46 Deposits l,167,949r l,139,063r l,165,941r l,152,122r 1,175,713 1,151,016 1,173,017 1,135,696 1,136,877 47 Demand deposits 310,677 279,677r 304,364 293,097 310,264 284,158 306,997 275,934 279,339 48 Individuals, partnerships, and corporations 257,513 237,5 lO' 256,362 245,031 259,089 241,524 253,698 232,871 236,380 49 Other holders 53,164 42,168 48,002 48,066 51,175 42,635 53,299 43,062 42,960 50 States and political subdivisions 10,485 8,584 9,526 8,896 9,226 7,412 8,485 8,893 7,465 51 U.S. government 3,075 1,669 3,274 1,552 3,123 1,720 8,236 1,796 1,775 52 Depository institutions in the United States 23,907 17,584 21,164 21,186 23,734 18,840 21,827 16,744 17,198 53 Banks in foreign countries 5,508 4,582 5,305 5,422 5,317 5,096 5,278 5,394 5,362 54 Foreign governments and official institutions 824 710 652 723 899 674 748 645 756 55 Certified and officers' checks 9,366 9,037 8,082 10,287 8,877 8,893 8,726 9,590 10,403 56 Transaction balances other than demand deposits 128,070 127,146 125,907 124,150 128,363 127,383 127,194 124,445 123,798 57 Nontransaction balances 729,203r 732,240r 735,670r 734,875r 737,086 739,474 738,826 735,317 733,739 58 Individuals, partnerships, and corporations 707,321r 709,619r 712,808r 71 l,451r 713,612 715,445 715,269 711,778 710,372 59 Other holders 21,882 22,621 22,862 23,424 23,474 24,029 23,557 23,539 23,367 60 States and political subdivisions 18,322 18,921 18,900 19,438 19,151 19,868 19,477 19,477 19,436 61 U.S. government 1,726 1,815 1,881 1,805 1,873 1,804 1,869 1,860 1,852 62 Depository institutions in the United States 1,339 1,382 1,662 1,824 2,095 1,949 1,801 1,784 1,661 63 Foreign governments, official institutions, and banks .. 495 503 419 356 355 409 410 418 418 64 Liabilities for borrowed money5 401,055 371,221 391,762 387,819 390,935 373,797 381,686 379,848 379,641 65 Borrowings from Federal Reserve Banks 0 0 0 0 0 0 0 0 0 66 Treasury tax and loan notes 26,536 12,626 10,872 14,633 17,069 6,964 5,040 7,471 4,770 67 Other liabilities for borrowed money 374,518r 358,595 380,890 373,186 373,866 366,833 376,645 372,377 374,872 68 Other liabilities (including subordinated notes and debentures)... 195,471r 197,509r 195,383r 198,904r 200,672 206,469 211,855 211,731 215,161 69 Total liabiUties l,764,476r l,707,793r l,753,086r l,738,845r 1,767,320 1,731,282 1,766,557 1,727,275 1,731,679 70 Residual (total assets less total liabilities)7 177,027' 176,686r 176,686r 177,330r 178,706 179,470 178,296 178,562 178,377 MEMO 71 Total loans and leases, gross, adjusted, plus securities l,584,522r l,574,057r l,584,354r l,586,457r 1,596,936 1,600,911 1,605,362 1,599,599 1,600,891 72 Time deposits in amounts of $100,000 or more 103,194r 104,530 107,633 108,525 109,161 109,090 108,764 107,267 105,678 73 Loans sold outright to affiliates9 579 576 578 572 572 570 568 567 566 74 Commercial and industrial 295 295 295 295 295 295 295 295 295 75 Other 284 281 283 277 277 275 273 272 271 76 Foreign branch credit extended to U.S. residents 23,497 23,686 23,710 23,366 23,784 23,601 23,529 23,444 23,593 77 Net owed to related institutions abroad 78,820r 85,594r 81,515r 86,391r 81,260 81,929 87,174 87,535 88,935 1. Includes certificates of participation, issued or guaranteed by agencies of the U.S. 8. Excludes loans to and federal funds transactions with commercial banks in the government, in pools of residential mortgages. United States. 2. Includes securities purchased under agreements to resell. 9. Affiliates include a bank's own foreign branches, nonconsolidated nonbank affiliates 3. Includes allocated transfer risk reserve. of the bank, the bank's holding company (if not a bank), and nonconsolidated nonbank 4. Includes negotiable order of withdrawal (NOWs) and automatic transfer service subsidiaries of the holding company. (ATS) accounts, and telephone and preauthorized transfers of savings deposits. 10. Credit extended by foreign branches of domestically chartered weekly reporting 5. Includes borrowings only from other than directly related institutions. banks to nonbank U.S. residents. Consists mainly of commercial and industrial loans, but 6. Includes federal funds purchased and securities sold under agreements to repur- includes an unknown amount of credit extended to other than nonfinancial businesses. chase. 7. This balancing item is not intended as a measure of equity capital for use in capital-adequacy analysis. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Commercial Banks A23 1.28 LARGE WEEKLY REPORTING U.S. BRANCHES AND AGENCIES OF FOREIGN BANKS Assets and Liabilities Millions of dollars, Wednesday figures 1995 AAccccoouunntt Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 ASSETS 1 Cash and balances due from depository institutions 16,567 15,327 15,283 15,299 14,847 15,327 15,820 15,325 16,251 2 U.S. Treasury and government agency securities 38,624 41,266 39,890 39,447 42,243 40,303 4400,,998844 3399,,998899 4400,,889933 3 Other securities 13,602 13,901 14,533 13,789 14,269 14,151 14,059 13,972 14,152 4 Federal funds sold1 29,097 26,119 24,767 24,944 26,442 25,507 28,188 25,741 29,425 5 To commercial banks in the United States 7,434 4,804 5,078 6,663 5,702 6,087 6,813 4,722 7,638 6 To others2 21,663 21,315 19,689 18,281 20,740 19,419 21,375 21,020 21,787 7 Other loans and leases, gross 171,511 169,919 170,173 168,574 171,226 171,500 171,997 172,612 170,847 8 Commercial and industrial 109,607 109,557 110,020 109,427 111,151 110,112 110,781 110,884 110,432 9 Bankers acceptances and commercial paper . 3,713 3,665 3,715 3,432 3,439 3,430 3,269 3,250 3,229 10 All other 105,895 105,892 106,305 105,995 107,712 106,682 107,511 107,634 107,203 11 U.S. addressees 101,732 101,748 102,276 101,884 103,439 102,298 102,780 102,915 102,629 12 Non-U.S. addressees 4,163 4,144 4,029 4,111 4,274 4,384 4,731 4,720 4,575 13 Loans secured by real estate 25,350 25,290 25,256 25,130 25,041 25,048 25,039 25,057 24,275 14 Loans to depository and financial institutions 27,590 26,457 26,417 25,746 26,041 27,444 27,665 27,734 26,964 15 Commercial banks in the United States 5,854 5,658 5,527 5,124 4,994 4,820 4,975 5,206 5,332 16 Banks in foreign countries 1,992 1,931 2,005 2,039 2,212 2,943 2,214 2,296 2,104 17 Nonbank financial institutions 19,743 18,867 18,885 18,583 18,835 19,681 20,476 20,232 19,529 18 For purchasing and carrying securities 4,307 4,288 3,971 3,900 4,636 4,190 4,157 4,700 4,511 19 To foreign governments and official institutions 349 374 363 329 446 576 441122 441166 441133 7,0 All other 4,308 3,952 4,145 4,042 3,912 4,130 3,943 3,821 4,252 21 Other assets (claims on nonrelated parties) 47,705 48,208 47,806 48,640 51,692 55,220 51,619 51,287 52,828 22 Total assets3 340,319 336,708 334,614 332,375 345,435 344,795 345,977 343,514 347,116 LIABILITIES 23 Deposits or credit balances owed to other than directly related institutions 96,295 97,044 95,647 96,621 95,007 97,075 98,251 98,592 100,387 24 Demand deposits4 4,127 3,800 4,024 4,133 3,870 3,717 3,962 3,815 4,516 25 Individuals, partnerships, and corporations .... 3,359 3,014 3,032 3,114 3,166 2,937 3,143 3,077 3,325 76 Other 768 785 992 1,019 705 780 819 738 1,191 27 Nontransaction accounts 92,169 93,245 91,623 92,488 91,137 93,357 94,290 94,777 95,872 28 Individuals, partnerships, and corporations .... 62,214 61,924 60,836 62,557 62,633 65,059 65,202 65,462 65,335 29 Other 29,955 31,321 30,787 29,931 28,504 28,298 29,088 29,316 30,537 30 Borrowings from other than directly related institutions 75,652 75,354 76,834 71,717 83,958 79,963 87,176 83,005 8811,,227777 31 Federal funds purchased5 43,331 41,812 44,664 38,776 47,280 40,792 48,299 43,406 40,973 37. From commercial banks in the United States .. 7,303 6,848 8,291 5,687 8,878 6,093 10,957 7,286 7,325 33 From others 36,028 34,964 36,373 33,089 38,402 34,699 37,341 36,120 33,648 34 Other liabilities for borrowed money 32,321 33,542 32,170 32,941 36,678 39,171 38,878 39,599 40,304 35 To commercial banks in the United States 6,960 6,169 6,235 5,927 5,828 5,756 5,769 5,930 6,028 36 To others 25,361 27,373 25,936 27,014 30,850 33,415 33,108 33,668 34,276 37 Other liabilities to nonrelated parties 44,116 45,705 44,101 45,656 48,454 52,166 49,049 48,052 48,484 38 Total liabilities6 340,319 336,708 334,614 332,375 345,435 344,795 345,977 343,514 347,116 MEMO 39 Total loans (gross) and securities, adjusted 239,546 240,743 238,758 234,968 243,485 240,553 243,440 242,386 242,348 40 Net owed to related institutions abroad 101,043 96,637 95,870 96,699 93,300 92,804 88,190 89,276 94,248 1. Includes securities purchased under agreements to resell. 5. Includes securities sold under agreements to repurchase. 2. Includes transactions with nonbank brokers and dealers in securities. 6. For U.S. branches and agencies of foreign banks having a net "due to" position, 3. For U.S. branches and agencies of foreign banks having a net "due from" position, includes net owed to related institutions abroad. includes net due from related institutions abroad. 7. Excludes loans to and federal funds transactions with commercial banks in the 4. Includes other transaction deposits. United States. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 DomesticN onfinancial Statistics • June 1995 1.32 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING Millions of dollars, end of period Year ending December 1994 1995 IItteemm 1990 1991 1992 1993 1994 Aug. Sept. Oct. Nov. Dec. Jan. Commercial paper (seasonally adjusted unless noted otherwise) 1 All issuers 562,656 528,832 545,619 555,075 595,382 566,502 574,856 588,271 580,510 595,382 612,554 Financial companies' Dealer-placed paper1 2 Total 214,706 212,999 226,456 218,947 223,038 221144,,771188 221144,,330000 222,019 215,733 223,038 231,318 3 Bank-related (not seasonally adjusted)3... n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Directly placed paper4 4 Total 200,036 182,463 171,605 180,389 207,701 220011,,004477 220044,,559955 206,264 203,584 207,701 215,423 5 Bank-related (not seasonally adjusted)3... n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 6 Nonfinancial companies5 147,914 133,370 147,558 155,739 164,643 150,737 155,961 159,988 161,193 164,643 165,813 Bankers dollar acceptances (not seasonally adjusted)6 7 Total 54,771 43,770 38,194 32,348 29,835 30,448 31,164 30,413 29,760 29,835 By holder 8 Accepting banks 9,017 11,017 10,555 12,421 11,783 11,543 11,299 11,061 11,689 11,783 9 Own bills 7,930 9,347 9,097 10,707 10,462 10,824 10,475 9,931 10,548 10,462 10 Bills bought from other banks 11,,008877 1,670 1,458 1,714 1,321 719 824 1,130 1,142 11,,332211 Federal Reserve Banks7 11 Foreign correspondents 918 1,739 1,276 725 410 325 388 332 234 410 n.a. 12 Others 44,836 31,014 26,364 19,202 17,642 18,580 19,477 19,020 17,836 17,642 By basis 13 Imports into United States 13,095 12,843 12,209 10,217 10,062 10,486 10,985 10,674 10,272 10,062 14 Exports from United States 12,703 10,351 8,096 7,293 6,355 6,458 6,575 6,754 6,688 6,355 15 Allother 28,973 20,577 17,890 14,838 13,417 13,505 13,604 12,986 12,800 13,417 1. Institutions engaged primarily in commercial, savings, and mortgage banking; sales, 6. Data on bankers dollar acceptances are gathered from approximately 100 institupersonal, and mortgage financing; factoring, finance leasing, and other business lending; tions. The reporting group is revised every January. Beginning January 1995, data for insurance underwriting; and other investment activities. Bankers dollar acceptances will be reported annually in September. 2. Includes all financial-company paper sold by dealers in the open market. 7. In 1977 the Federal Reserve discontinued operations in bankers dollar acceptances 3. Series were discontinued in January 1989. for its own account. 4. As reported by financial companies that place their paper directly with investors. 5. Includes public utilities and firms engaged primarily in such activities as communications, construction, manufacturing, mining, wholesale and retail trade, transportation, and services. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A25 1.33 PRIME RATE CHARGED BY BANKS Short-Term Business Loans1 Percent per year Average Average Average Date of change rate rate rate 1992—July 2 6.00 1992 6.25 1993—Jan. . 6.00 1994—Jan. . 6.00 1993 6.00 Feb. 6.00 Feb. 6.00 1994—Mar. 24 6.25 1994 7.15 Mar. 6.00 Mar. 6.06 Apr. 19 6.75 Apr. 6.00 Apr. 6.45 May 17 7.25 1992—Jan. 6.50 May 6.00 May 6.99 Aug. 16 7.75 Feb. 6.50 June 6.00 June 7.25 Nov. 15 8.50 Mar. 6.50 July . 6.00 July . 7.25 Apr. 6.50 Aug. 6.00 Aug. 7.51 1995—Feb. 1 9.00 May 6.50 Sept. 6.00 Sept. 7.75 June 6.50 Oct. . 6.00 Oct. . 7.75 July 6.02 Nov. 6.00 Nov. 8.15 Aug. 6.00 Dec. 6.00 Dec. 8.50 Sept. 6.00 Oct. 6.00 1995—Jan. . 8.50 Nov. 6.00 Feb. 9.00 Dec 6.00 Mar. 9.00 Apr. 9.00 1. The prime rate is one of several base rates that banks use to price short-term recent Call Report. Data in this table also appear in the Board's H.15 (519) weekly and business loans. The table shows the date on which a new rate came to be the predominant G. 13 (415) monthly statistical releases. For ordering address, see inside front cover. one quoted by a majority of the twenty-five largest banks by asset size, based on the most Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.35 INTEREST RATES Money and Capital Markets Percent per year; figures are averages of business day data unless otherwise noted 1994 1995 1995, week ending IItteemm 11999922 11999933 11999944 Dec. Jan. Feb. Mar. Mar. 3 Mar. 10 Mar. 17 Mar. 24 Mar. 31 MONEY MARKET INSTRUMENTS 1 Federal funds1,2,3 3.52 3.02 4.21 5.45 5.53 5.92 5.98 5.88 5.93 5.94 5.97 6.06 2 Discount window borrowing2,4 3.25 3.00 3.60 4.75 4.75 5.25 5.25 5.25 5.25 5.25 5.25 5.25 Commercial paper3,5,6 3 1-month 3.71 3.17 4.43 6.08 5.86 6.05 6.07 6.05 6.08 6.07 6.05 6.08 4 3-month 3.75 3.22 4.66 6.26 6.22 6.15 6.15 6.13 6.19 6.15 6.14 6.15 5 6-month 3.80 3.30 4.93 6.62 6.63 6.38 6.30 6.28 6.39 6.31 6.27 6.25 Finance paper, directly placed3,5,7 6 1-month 3.62 3.12 4.33 5.93 5.76 5.95 5.95 5.93 5.95 5.95 5.96 5.96 7 3-month 3.65 3.16 4.53 6.12 6.10 6.04 6.03 6.02 6.06 6.04 6.03 6.02 8 6-month 3.63 3.15 4.56 6.17 6.25 6.10 6.04 6.02 6.07 6.03 6.03 6.03 Bankers acceptances3,5,8 9 3-month 3.62 3.13 4.56 6.18 6.12 6.05 6.04 6.03 6.08 6.03 6.02 6.05 10 6-month 3.67 3.21 4.83 6.53 6.45 6.22 6.14 6.12 6.20 6.12 6.11 6.13 Certificates of deposit, secondary market3,9 11 1-month 3.64 3.11 4.38 6.01 5.84 6.01 6.02 6.00 6.02 6.01 6.01 6.04 12 3-month 3.68 3.17 4.63 6.29 6.24 6.16 6.15 6.13 6.20 6.14 6.12 6.15 13 6-month 3.76 3.28 4.96 6.78 6.71 6.44 6.34 6.33 6.41 6.33 6.31 6.34 14 Eurodollar deposits, 3-month3,10 3.70 3.18 4.63 6.27 6.23 6.14 6.15 6.13 6.20 6.13 6.13 6.16 U.S. Treasury bills Secondary market3,5 15 3-month 3.43 3.00 4.25 5.60 5.71 5.77 5.73 5.74 5.76 5.75 5.72 5.69 16 6-month 3.54 3.12 4.64 6.21 6.21 6.03 5.89 5.91 5.96 5.90 5.87 5.81 17 1-year 3.71 3.29 5.02 6.67 6.59 6.28 6.03 6.07 6.14 6.00 5.97 5.98 Auction average3,5,11 18 3-month 3.45 3.02 4.29 5.64 5.81 5.80 5.73 5.73 5.77 5.76 5.76 5.64 19 6-month 3.57 3.14 4.66 6.21 6.31 6.10 5.91 5.90 6.00 5.92 5.91 5.80 20 1-year 3.75 3.33 4.98 6.75 6.86 6.59 6.16 n.a. 6.16 n.a. n.a. n.a. U.S. TREASURY NOTES AND BONDS Constant maturities12 21 1-year 3.89 3.43 5.32 7.14 7.05 6.70 6.43 6.47 6.54 6.39 6.37 6.38 22 2-year 4.77 4.05 5.94 7.59 7.51 7.11 6.78 6.83 6.91 6.71 6.71 6.73 23 3-year 5.30 4.44 6.27 7.71 7.66 7.25 6.89 6.95 7.04 6.81 6.83 6.84 24 5-year 6.19 5.14 6.69 7.78 7.76 7.37 7.05 7.10 7.18 6.95 7.01 7.01 25 7-year 6.63 5.54 6.91 7.80 7.79 7.44 7.14 7.21 7.28 7.03 7.10 7.11 26 10-year 7.01 5.87 7.09 7.81 7.78 7.47 7.20 7.27 7.35 7.11 7.16 7.15 27 20-year n.a. 6.29 7.49 7.99 7.97 7.73 7.57 7.61 7.68 7.48 7.55 7.51 28 30-year 7.67 6.59 7.37 7.87 7.85 7.61 7.45 7.49 7.56 7.37 7.43 7.40 Composite 29 More than 10 years (long-term) 7.52 6.45 7.41 7.97 7.93 7.69 7.52 7.56 7.64 7.44 7.50 7.48 STATE AND LOCAL NOTES AND BONDS Moody's series13 30 6.09 5.38 5.77 6.62 6.55 6.05 5.92 5.98 5.95 5.93 5.82 5.90 31 Baa 6.48 5.83 6.17 7.17 7.05 6.61 6.06 6.10 6.10 6.10 6.02 6.00 32 Bond Buyer series14 6.44 5.60 6.18 6.80 6.53 6.22 6.10 6.08 6.18 6.06 6.09 6.07 CORPORATE BONDS 33 Seasoned issues, all industries15 8.55 7.54 8.26 8.73 8.71 8.50 8.35 8.41 8.46 8.27 8.33 8.30 Rating group 34 8.14 7.22 7.97 8.46 8.46 8.26 8.12 8.17 8.22 8.04 8.10 8.08 35 Aa 8.46 7.40 8.15 8.62 8.60 8.39 8.24 8.29 8.35 8.17 8.22 8.19 36 A 8.62 7.58 8.28 8.73 8.70 8.48 8.33 8.39 8.44 8.25 8.32 8.28 37 Baa 8.98 7.93 8.63 9.10 9.08 8.85 8.70 8.76 8.81 8.62 8.69 8.65 38 A-rated, recently offered utility bonds16 8.52 7.46 8.29 8.78 8.75 8.55 8.40 8.52 8.43 8.32 8.35 8.40 MEMO Dividend-price ratio17 39 Common stocks 2.99 2.78 2.82 2.91 2.87 2.81 2.76 2.79 2.81 2.76 2.73 2.69 1. The daily effective federal funds rate is a weighted average of rates on trades issue-date basis. through New York brokers. 12. Yields on actively traded issues adjusted to constant maturities. Source: U.S. 2. Weekly figures are averages of seven calendar days ending on Wednesday of the Department of the Treasury. current week; monthly figures include each calendar day in the month. 13. General obligation bonds based on Thursday figures; Moody's Investors Service. 3. Annualized using a 360-day year for bank interest. 14. State and local government general obligation bonds maturing in twenty years are 4. Rate for the Federal Reserve Bank of New York. used in compiling this index. The twenty-bond index has a rating roughly equivalent to 5. Quoted on a discount basis. Moodys' A1 rating. Based on Thursday figures. 6. An average of offering rates on commercial paper placed by several leading dealers 15. Daily figures from Moody's Investors Service. Based on yields to maturity on for firms whose bond rating is AA or the equivalent. selected long-term bonds. 7. An average of offering rates on paper directly placed by finance companies. 16. Compilation of the Federal Reserve. This series is an estimate of the yield on 8. Representative closing yields for acceptances of the highest-rated money center recently offered, A-rated utility bonds with a thirty-year maturity and five years of call banks. protection. Weekly data are based on Friday quotations. 9. An average of dealer offering rates on nationally traded certificates of deposit. 17. Standard & Poor's corporate series. Common stock ratio is based on the 500 stocks 10. Bid rates for Eurodollar deposits at 11:00 a.m. London time. Data are for indication in the price index. purposes only. NOTE. Some of the data in this table also appear in the Board's H.15 (519) weekly and 11. Auction date for daily data; weekly and monthly averages computed on an G. 13 (415) monthly statistical releases. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A27 1.36 STOCK MARKET Selected Statistics 1994 1995 IInnddiiccaattoorr 11999922 11999933 11999944 July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Prices and trading volume (averages of daily figures) Common stock prices (indexes) 1 New York Stock Exchange (Dec. 31, 1965 = 50) 229.00 249.71 254.16 249.29 256.08 257.61 255.22 252.48 248.65 253.56 261.86 266.81 2 Industrial 284.26 300.10 315.32 307.34 316.56 322.19 321.53 319.33 313.92 319.93 328.98 337.96 3 Transportation 201.02 242.68 247.17 244.21 244.67 239.10 230.71 227.44 218.93 230.25 237.29 252.37 4 Utility 99.48 114.55 104.96 102.73 105.61 102.30 101.67 100.07 100.01 100.58 103.87 102.08 5 Finance 179.29 216.55 209.75 210.91 214.77 211.90 203.33 198.38 195.25 201.05 211.76 213.29 6 Standard & Poor's Corporation (1941-43 = 10)' 415.75 451.63 460.42 451.40 464.24 466.96 463.81 461.01 455.19 465.25 481.92 493.20 7 American Stock Exchange (Aug. 31, 1973 = 50)2 391.28 438.77 449.49 430.10 444.89 456.31 456.25 445.16 427.39 436.09 446.37 456.06 Volume of trading (thousands of shares) 8 New York Stock Exchange 202,558 263,374 290,652 250,382 277,877 292,356 301,327 297,001 302,049 326,652 333,020 338,733 9 American Stock Exchange 14,171 18,188 17,951 14,378 15,874 18,785 20,731 18,465 18,745 18,829 18,424 17,905 Customer financing (millions of dollars, end-of-period balances) 10 Margin credit at broker-dealers3 43,990 60,310 61,160 61,930 63,070 61,630 62,150 61,000 61,160 64,380 59,800 60,270 Free credit balances at brokers4 11 Margin accounts' 8,970 12,360 14,095 12,620 12,090 12,415 12,875 13,635 14,095 13,225 12,380 12,745 12 Cash accounts 22,510 27,715 28,870 25,790 24,400 25,230 24,180 25,625 28,870 26,440 25,860 26,680 Margin requirements (percent of market value and effective date)6 Mar. 11, 1968 June 8, 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. In July 1976 a financial group, composed of banks and insurance companies, was credit is collateralized by securities. Margin requirements on securities other than options added to the group of stocks on which the index is based. The index is now based on 400 are the difference between the market value (100 percent) and the maximum loan value of industrial stocks (formerly 425), 20 transportation (formerly 15 rail), 40 public utility collateral as prescribed by the Board. Regulation T was adopted effective Oct. 15, 1934; (formerly 60), and 40 financial. Regulation U, effective May 1, 1936; Regulation G, effective Mar. 11, 1968; and 2. On July 5, 1983, the American Stock Exchange rebased its index, effectively cutting Regulation X, effective Nov. 1,1971. previous readings in half. On Jan. 1, 1977, the Board of Governors for the first time established in Regulation T 3. Since July 1983, under the revised Regulation T, margin credit at broker-dealers has the initial margin required for writing options on securities, setting it at 30 percent of the included credit extended against stocks, convertible bonds, stocks acquired through the current market value of the stock underlying the option. On Sept. 30, 1985, the Board exercise of subscription rights, corporate bonds, and government securities. Separate changed the required initial margin, allowing it to be the same as the option maintenance reporting of data for margin stocks, convertible bonds, and subscription issues was margin required by the appropriate exchange or self-regulatory organization; such maintediscontinued in April 1984. nance margin rules must be approved by the Securities and Exchange Commission. 4. Free credit balances are amounts in accounts with no unfulfilled commitments to Effective Jan. 31, 1986, the SEC approved new maintenance margin rules, permitting brokers and are subject to withdrawal by customers on demand. margins to be the price of the option plus 15 percent of the market value of the stock 5. Series initiated in June 1984. underlying the option. 6. Margin requirements, stated in regulations adopted by the Board of Governors Effective June 8, 1988, margins were set to be the price of the option plus 20 percent of pursuant to the Securities Exchange Act of 1934, limit the amount of credit that can be the market value of the stock underlying the option (or 15 percent in the case of used to purchase and carry "margin securities" (as defined in the regulations) when such stock-index options). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.38 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Fiscal year Calendar year TTTyyypppeee ooofff aaaccccccooouuunnnttt ooorrr ooopppeeerrraaatttiiiooonnn 1994 1995 11999922 11999933 11999944 Oct. Nov. Dec. Jan. Feb. Mar. U.S budget1 1 Receipts, total 1,090,453 1,153,226 1,257,187 89,024 87,673 130,810 131,801 82,544 92,532 2 On-budget 788,027 841,292 922,161 65,385 62,083 103,859 101,036 54,405 61,971 3 Off-budget 302,426 311,934 335,026 23,639 25,590 26,951 30,765 28,139 30,561 4 Outlays, total 1,380,856 1,408,532 1,461,067 120,365 124,915 134,941 115,172 120,536 142,458 5 On-budget 1,128,518 1,141,945 1,460,557 95,307 99,464 123,643 89,890 94,058 116,508 6 Off-budget 252,339 266,587 279,372 25,059 25,452 11,297 25,282 26,478 25,951 7 Surplus or deficit (-), total -290,403 -255,306 -203,370 -31,342 -37,242 -4,130 16,628 -37,992 -49,927 8 On-budget -340,490 -300,653 -259,024 -29,922 -37,381 -19,783 11,146 -39,653 -54,537 9 Off-budget 50,087 45,347 55,654 -1,420 138 15,653 5,483 1,661 4,610 Source of financing (total) 10 Borrowing from the public 310,918 248,594 184,998 32,457 40,528 -13,316 13,337 38,972 13,645 11 Operating cash (decrease, or increase (-)) -17,305 6,283 16,564 -480 9,366 476 -23,264 14,000 17,747 12 Other2 -3,210 429 1,808 -635 -12,652 16,970 -6,701 -14,980 18,535 MEMO 13 Treasury operating balance (level, end of period) 58,789 52,506 35,942 36,422 27,056 26,580 49,844 35,844 18,097 14 Federal Reserve Banks 24,586 17,289 6,848 5,164 5,348 7,161 13,964 6,890 4,543 15 Tax and loan accounts 34,203 35,217 29,094 31,258 21,709 19,419 35,880 28,954 13,554 1. Since 1990, off-budget items have been the social security trust funds (federal gold; net gain or loss for U.S. currency valuation adjustment; net gain or loss for IMF old-age survivors insurance and federal disability insurance) and the U.S. Postal Service. loan-valuation adjustment; and profit on sale of gold. 2. Includes special drawing rights (SDRs); reserve position on the U.S. quota in the SOURCES. U.S. Department of the Treasury, Monthly Treasury Statement of Receipts International Monetary Fund (IMF); loans to the IMF; other cash and monetary assets; and Outlays of the US. Government, and U.S. Office of Management and Budget, Budget accrued interest payable to the public; allocations of SDRs; deposit funds; miscellaneous of the U.S. Government. liability (including checks outstanding) and asset accounts; seigniorage; increment on Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A3 3 1.39 U.S. BUDGET RECEIPTS AND OUTLAYS1 Millions of dollars Fiscal year Calendar year SSSooouuurrrccceee ooorrr tttyyypppeee 1993 1994 1995 11999933 11999944 HI H2 HI H2 Jan. Feb. Mar. RECEIPTS 1 AH sources 1,153,226 1,257,453 593,212 582,038 652,236 625,557 131,801 82,544 92,532 2 Individual income taxes, net 509,680 543,055 255,556 262,073 275,053 273,474 79,162 33,863 26,846 3 Withheld 430,211 459,699 209,517 228,423 225,387 240,062 49,432 40,643 44,561 4 Presidential Election Campaign Fund 28 70 25 2 63 10 0 4 18 5 Nonwithheld 154,989 160,364 113,510 41,768 118,245 42,031 29,980 1,061 4,284 6 Refunds 75,546 77,077 67,468 8,115 68,642 9,207 245 7,845 22,016 Corporation income taxes 7 Gross receipts 131,548 154,205 69,044 68,266 80,536 78,392 5,415 3,483 17,238 8 Refunds 14,027 13,820 7,198 6,514 6,933 7,331 2,157 1,423 2,375 9 Social insurance taxes and contributions, net .. . 428,300 461,475 227,177 206,176 248,301 220,141 40,442 38,653 39,379 10 Employment taxes and contributions 396,939 428,810 208,776 192,749 228,714 206,613 26,096 35,667 38,646 11 Self-employment taxes and contributions 20,604 24,433 16,270 4,335 20,762 4,135 1,279 1,718 1,862 12 Unemployment insurance 26,556 28,004 16,074 11,010 17,301 11,177 1,069 2,630 320 13 Other net receipts4 4,805 4,661 2,326 2,417 2,284 2,349 372 357 413 14 Excise taxes 48,057 55,225 23,398 25,994 26,444 30,062 4,555 3,485 5,143 15 Customs deposits 18,802 20,099 8,860 10,215 9,500 11,042 1,539 1,435 1,470 16 Estate and gift taxes 12,577 15,225 6,494 6,617 8,197 7,071 1,005 916 1,218 17 Miscellaneous receipts5 18,273 22,041 9,879 9,227 11,170 13,305 1,839 2,131 3,612 OUTLAYS 18 All types 1,408,532 1,461,067 673,915 727,685 710,620 751,642 115,172 120,536 142,458 19 National defense 291,086 281,451 140,535 146,672 133,841 141,092 18,499 21,461 26,533 20 International affairs 16,826 17,249 6,565 10,186 5,800 12,056 999 1,108 425 21 General science, space, and technology 17,030 17,602 7,996 8,880 8,502 8,979 1,194 1,374 1,628 22 Energy 4,319 5,398 2,462 1,663 2,036 2,949 488 260 569 23 Natural resources and environment 20,239 20,902 8,592 11,221 9,829r 12,373 1,571 1,374 1,951 24 Agriculture 20,443 15,131 11,872 7,516 7,451 7,697 1,049 1,264 1,195 25 Commerce and housing credit -22,725 -4,851 -14,537 -1,490 -5,114 -2,678 -1,469 -2,978 -1,853 26 Transportation 35,004 36,835 16,076 19,570 16,754r 20,489 3,080 2,799 3,167 27 Community and regional development 9,051 11,877 4,929 4,288 4,855r 7,070 1,140 228 971 28 Education, training, employment, and social services 50,012 44,730 24,080 26,753 19,258r 25,887 4,650 44,,007788 44,,667788 29 Health 99,415 106,495 49,882 52,958 53,195r 54,123 9,440 8,918 10,625 30 Social security and Medicare 435,137 464,314 195,933 223,735 232,777 236,819 39,734 39,461 43,209 31 Income security 207,257 213,972 107,870 102,380 109,080 101,743 16,326 20,583 24,708 32 Veterans benefits and services 35,720 37,637 16,385 19,852 16,686 19,757 1,996 3,023 4,642 33 Administration of justice 14,955 15,283 7,482 7,400 7,718 7,800 1,568 1,099 1,488 34 General government 13,009 11,348 5,205 6,531 5,084r 7,393 -233 1,170 1,680 35 Net interest6 198,811 202,957 99,635 99,914 99,844 109,435 19,568 18,002 19,671 36 Undistributed offsetting receipts7 -37,386 -37,772 -17,035 -20,344 -17,308 -20,065 -2,911 -2,688 -2,829 1. Functional details do not sum to total outlays for calendar year data because 5. Deposits of earnings by Federal Reserve Banks and other miscellaneous receipts. revisions to monthly totals have not been distributed among functions. Fiscal year total for 6. Includes interest received by trust funds. outlays does not correspond to calendar year data because revisions from the Budget have 7. Rents and royalties for the outer continental shelf, U.S. government contributions for not been fully distributed across months. employee retirement, and certain asset sales. 2. Old-age, disability, and hospital insurance, and railroad retirement accounts. SOURCES. U.S. Department of the Treasury, Monthly Treasury Statement of Receipts 3. Old-age, disability, and hospital insurance. and Outlays of the U.S. Government-, and U.S. Office of Management and Budget, Budget 4. Federal employee retirement contributions and civil service retirement and of the U.S. Government, Fiscal Year 1996. disability fund. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.40 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars, end of month 1993 1994 1995 IItteemm Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31 1 Federal debt outstanding 4,250 4,373 4,436 4,562 4,602 4,673 4,721 4,800 4,864 4 2 3 Pu H b H l e e ic l l d d d b b e y y b t a p s g u e e b c n l u i c c r i i e ti s e s 4 3 1 , , , 2 1 0 3 8 4 1 8 3 4 3 1 , , , 3 2 1 5 5 0 2 2 0 4 3 1 , , , 4 2 1 1 9 1 2 5 7 4 3 1 , , , 5 3 1 8 3 5 2 6 4 4 3 1 , , , 5 4 1 7 3 4 6 4 2 4 3 1 , , , 6 4 2 4 4 0 6 3 3 4 3 1 , , , 6 4 2 9 8 1 3 0 3 3 1 n , , 5 2 .a 4 5 . 3 7 4| | 5 Agency securities 20 21 25 27 26 28 29 27 n.a. 6 Held by public 20 21 25 27 26 27 29 27 1 7 Held by agencies 0 0 0 0 0 0 0 0 • 8 Debt subject to statutory limit 4,140 4,256 4,316 4,446 4,491 4,559 4,605 4,711 4,775 9 Public debt securities 4,139 4,256 4,315 4,445 4,491 4,559 4,605 4,711 4,774 10 Other debt1 0 0 0 0 0 0 0 0 0 MEMO 11 Statutory debt limit 4,145 4,370 4,900 4,900 4,900 4,900 4,900 4,900 4,900 1. Consists of guaranteed debt of U.S. Treasury and other federal agencies, specified SOURCES. U.S. Department of the Treasury, Monthly Statement of the Public Debt of participation certificates, notes to international lending organizations, and District of the United States and Treasury Bulletin. Columbia stadium bonds. 1.41 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1994 1995 TTyyppee aanndd hhoollddeerr 11999911 11999922 11999933 11999944 Q2 Q3 Q4 Q1 1 Total gross public debt 3,801.7 4,177.0 4,535.7 n.a. 4,645.8 4,692.8 n.a. n.a. By type 2 Interest-bearing 3,798.9 4,173.9 4,532.3 4,769.2 4,642.5 4,689.5 4,769.2 4,860.5 3 Marketable 2,471.6 2,754.1 2,989.5 3,126.0 3,051.0 3,091.6 3,126.0 3,227.3 4 Bills 590.4 657.7 714.6 733.8 698.5 697.3 733.8 756.5 5 Notes 1,430.8 1,608.9 1,764.0 1,867.0 1,835.7 1,867.5 1,867.0 1,938.2 6 Bonds 435.5 472.5 495.9 510.3 501.8 511.8 510.3 517.7 7 Nonmarketable1 1,327.2 1,419.8 1,542.9 1,643.1 1,591.5 1,597.9 1,643.1 1,633.2 8 State and local government series 159.7 153.5 149.5 132.6 143.4 137.4 132.6 122.9 9 Foreign issues2 41.9 37.4 43.5 42.5 42.2 42.0 42.5 41.8 10 Government 41.9 37.4 43.5 42.5 42.2 42.0 42.5 41.8 11 Public .0 .0 .0 .0 .0 .0 .0 .0 12 Savings bonds and notes 135.9 155.0 169.4 177.8 174.9 176.4 177.8 178.8 13 Government account series3 959.2 1,043.5 1,150.0 1,259.8 1,200.6 1,211.7 1,259.8 1,259.2 14 Non-interest-bearing 2.8 3.1 3.4 31.0 3.3 3.2 31.0 3.6 By holder 4 15 U.S. Treasury and other federal agencies and trust funds 968.7 1,047.8 1,153.5 1,203.0 1,213.1 1,257.1 16 Federal Reserve Banks 281.8 302.5 334.2 357.7 355.2 374.1 17 Private investors 2,563.2 2,839.9 3,047.7 3,088.2 3,127.8 18 Commercial banks 233.4 294.0 316.0 330.7 325.0 19 Money market funds 80.0 79.4 80.5 59.5 59.9 20 Insurance companies 168.7 197.5 216.0 244.1 250.0 21 Other companies 150.8 192.5 213.0 n a. 226.3 229.3 n.a. 22 State and local treasuries 520.3 534.8 564.0 520.1 521.0 Individuals 23 Savings bonds 138.1 157.3 171.9 177.1 178.6 24 Other securities 125.8 131.9 137.9 144.0 148.6 25 Foreign and international5 491.8 549.7 623.3 632.5 653.8 26 Other miscellaneous investors6 651.3 702.4 725.0 754.0 761.6 1. Includes (not shown separately) securities issued to the Rural Electrification Admin- 5. Consists of investments of foreign balances and international accounts in the United istration, depository bonds, retirement plan bonds, and individual retirement bonds. States. 2. Nonmarketable series denominated in dollars, and series denominated in foreign 6. Includes savings and loan associations, nonprofit institutions, credit unions, mutual currency held by foreigners. savings banks, corporate pension trust funds, dealers and brokers, certain U.S. Treasury 3. Held almost entirely by U.S. Treasury and other federal agencies and trust funds. deposit accounts, and federally sponsored agencies. 4. Data for Federal Reserve Banks and U.S. government agencies and trust funds are SOURCES. U.S. Treasury Department, data by type of security, Monthly Statement of the actual holdings; data for other groups are Treasury estimates. Public Debt of the United States; data by holder, Treasury Bulletin. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A3 3 1.42 U.S. GOVERNMENT SECURITIES DEALERS Transactions1 Millions of dollars, daily averages 1994 1995 1995, week ending IItteemm Dec. Jan. Feb. Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Mar. 29 OUTRIGHT TRANSACTIONS2 By type of security 1 U.S. Treasury bills 55,792 61,020 58,060 62,823 64,937 61,124 50,127 54,360 57,737 48,177 43,883 4433,,998822 Coupon securities, by maturity 2 Five years or less 83,78 lr 99,720* 114,440 116,168 108,919 114,586* 114,990* 120,038 97,277 93,542 92,597 98,140 3 More than five years 34,603r 40,543r 54,328 48,611 58,840 59,826* 45,971* 53,692 43,960 48,317 44,731 43,346 4 Federal agency 23,472 26,320 25,597 25,757 23,905 24,872 26,459 27,499 23,122 22,289 21,670 25,784 5 Mortgage-backed 24,508 27,653 29,731 20,936 40,686 36,306 21,248 20,623 39,430 33,682 19,799 15,160 By type of counterparty With interdealer broker 6 U.S. Treasury 100,469 116,796 131,023 134,359 134,701 137,768 119,117 132,044 120,017 112,382 106,850 110,635 7 Federal agency 510 662 964 789 766 988 1,198 931 761 895 616 631 8 Mortgage-backed 8,208 10,543 9,433 8,183 10,912 11,292 8,384 6,882 12,172 10,967 6,738 5,825 With other 9 U.S. Treasury 73,707 84,487 95,805 93,244 97,994 97,769 91,970 96,047 78,957 77,654 74,361 74,831 10 Federal agency 22,962 25,658 24,633 24,968 23,139 23,884 25,261 26,569 22,362 21,395 21,054 25,153 11 Mortgage-backed 16,300 17,111 20,299 12,753 29,774 25,013 12,864 13,741 27,258 22,715 13,061 9,335 FUTURES TRANSACTIONS3 By type of deliverable security 12 U.S. Treasury bills 1,377 1,096 1,627 1,653 959 1,870 2,022 1,659 3,308 1,904 1,601 716 Coupon securities, by maturity 13 Five years or less 3,097 3,016 3,901 3,616 3,362 3,710 3,966 4,802 3,943 3,825 2,883 2,871 14 More than five years 10,277 11,231 14,344 12,856 12,955 15,352 13,378 16,401 14,695 16,291 14,747 12,501 15 Federal agency 0 0 0 0 0 0 0 0 0 0 0 0 16 Mortgage-backed 0 0 0 0 0 0 0 0 0 0 0 0 OPTIONS TRANSACTIONS4 By type of underlying security 17 U.S. Treasury bills 0 0 0 0 0 0 0 0 0 0 0 0 Coupon securities, by maturity 18 Five years or less 1,526r 3,257r 3,272 4,131 3,382r 3,722 2,986 2,714 2,348 3,111 2,317 2,251 19 More than five years 3,203r 4,367r 4,616 4,153 4,214r 4,142 5,649 4,536 3,506 4,420 3,444 4,220 20 Federal agency 0 0 0 0 0 0 0 0 0 0 0 0 21 Mortgage-backed 551r 669r 1,154 890* l,183r 957 1,301 1,248 732 711 651 688 1. Transactions are market purchases and sales of securities as reported to the Federal Forward transactions are agreements made in the over-the-counter market that specify Reserve Bank of New York by the U.S. government securities dealers on its published list delayed delivery. Forward contracts for U.S. Treasury securities and federal agency debt of primary dealers. Monthly averages are based on the number of trading days in the securities are included when the time to delivery is more than five business days. Forward month. Transactions are assumed evenly distributed among the trading days of the report contracts for mortgage-backed agency securities are included when the time to delivery is week. Immediate, forward, and futures transactions are reported at principal value, which more than thirty business days. does not include accrued interest; options transactions are reported at the face value of the 3. Futures transactions are standardized agreements arranged on an exchange. All underlying securities. futures transactions are included regardless of time to delivery. Dealers report cumulative transactions for each week ending Wednesday. 4. Options transactions are purchases or sales of put and call options, whether arranged 2. Outright transactions include immediate and forward transactions. Immediate deliv- on an organized exchange or in the over-the-counter market, and include options on ery refers to purchases or sales of securities (other than mortgage-backed federal agency futures contracts on U.S. Treasury and federal agency securities. securities) for which delivery is scheduled in five business days or less and "when- NOTE, "n.a." indicates that data are not published because of insufficient activity. issued" securities that settle on the issue date of offering. Transactions for immediate deliveiy Major changes in the report form filed by primary dealers induced a break in the dealer of mortgage-backed agency securities include purchases and sales for which delivery is scheduled data series as of the week ending July 6, 1994. in thirty business days or less. Stripped securities are reported at market value by maturity of coupon or corpus. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.43 U.S. GOVERNMENT SECURITIES DEALERS Positions and Financing1 Millions of dollars 1994 1995 1995, week ending IItteemm Dec.r Jan. Feb. Feb. 1 Feb. 8 Feb. 15 Feb. 22 Mar. 1 Mar. 8 Mar. 15 Mar. 22 Positions2 NET OUTRIGHT POSITIONS3 By type of security 1 U.S. Treasury bills 15,134 5,473r 4,561 3,205 1,205 5,957 5,265 6,252 14,838 14,691 7,662 Coupon securities, by maturity 2 Five years or less -7,704 - 10,046r -11,938 -10,054 -10,384 -20,384 -12,875 -3,119 -6,508 -6,877 -9,472 3 More than five years -32,181 —32,608r -24,446 -31,447 -24,482 -22,832 -23,909 -25,747 -28,178 -29,981 -29,126 4 Federal agency 20,258 19,998r 21,199 19,077 17,773 21,203 22,356 24,196 24,219 25,276 23,574 5 Mortgage-backed 32,886 32,212' 32,963 33,204 33,378 32,940 31,899 33,705 33,978 32,513 31,658 NET FUTURES POSITIONS By type of deliverable security 6 U.S. Treasury bills -901 — 1,900r -5,797 -6,744 -6,059 -6,655 -6,129 -3,945 -7,386 -9,428 -11,898 Coupon securities, by maturity 7 Five years or less 5,292 3,629 1,382 2,432 2,419 1,396 785 678 502 615 1,388 8 More than five years 857 2,312 -2,170 1,484 -3,257r -3,283 -2,434 94 1,320 2,176 -51 9 Federal agency 0 0 0 0 0 0 0 0 0 0 0 10 Mortgage-backed 0 0 0 0 0 0 0 0 0 0 0 Financing5 Reverse repurchase agreements 11 Overnight and continuing 238,704 240,357 245,656 254,993 231,926 263,908 234,665 251,649 221,724 236,787 241,780 12 Term 355,244 347,704r 332,428 338,019r 368,698 312,969 331,875 312,527 339,654 358,199 382,645 Securities borrowed 13 Overnight and continuing 181,747 180,806r 178,369 180,826 181,229 178,938 176,924 175,644 171,574 172,561 172,159 14 Term 46,339 50,752 50,906 47,962 51,132 48,770 52,213 52,100 54,938 56,336 57,913 Securities received as pledge 15 Overnight and continuing 3,346 3,637 3,321 3,178 3,189 3,594 3,255 3,259 3,284 3,257 3,332 16 Term 37 177 52 445 22 n.a. 15 64 17 37 72 Repurchase agreements 17 Overnight and continuing 432,366 441,838r 473,802 462,438r 439,118 493,818 466,853 500,915 466,453 492,039 466,609 18 Term 341,663 307,485 279,666 297,051 321,373 258,536 276,465 256,497 287,499 306,140 346,396 Securities loaned 19 Overnight and continuing 5,984 6,686r 5,911 7,555 6,822 7,015 4,303 5,160 4,043 4,082 3,952 20 Term 1,328 1,524 1,301 1,435 1,993 1,097 1,345 659 928 n.a. 1,402 Securities pledged 21 Overnight and continuing 35,928 33,191 28,665 28,746 29,590 28,136 26,807 30,357 28,338 28,351 28,727 22 Term 1,609 1,684 2,278 1,328 1,429 2,631 2,276 3,016 2,892 3,269 3,391 Collateralized loans 23 Overnight and continuing 13,992 14,662r 15,921 14,575r 18,160r 15,935r 17,660 11,486 14,808 13,174 15,485 24 Term n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. MEMO: Matched book6 Securities in 25 Overnight and continuing 223,879 230,535r 227,486 240,169r 216,882 238,935 219,472 233,735 211,523 233,798 227,955 26 Term 326,160 321,920r 304,497 313,694r 338,830 283,869 304,848 286,566 316,804 326,727 354,173 Securities out 27 Overnight and continuing 255,965 278,583r 285,050 285,443r 272,573 301,655 271,294 296,216 273,465 291,830 291,749 28 Term 279,824 258,389 227,576 250,859 267,966 206,040 227,764 201,480 234,267 250,048 287,650 1. Data for positions and financing are obtained from reports submitted to the Federal 4. Futures positions reflect standardized agreements arranged on an exchange. All Reserve Bank of New York by the U.S. government securities dealers on its published list futures positions are included regardless of time to delivery. of primary dealers. Weekly figures are close-of-business Wednesday data. Positions for 5. Overnight financing refers to agreements made on one business day that mature on calendar days of the report week are assumed to be constant. Monthly averages are based the next business day; continuing contracts are agreements that remain in effect for more on the number of calendar days in the month. than one business day but have no specific maturity and can be terminated without 2. Securities positions are reported at market value. advance notice by either party; term agreements have a fixed maturity of more than one 3. Net outright positions include immediate and forward positions. Net immediate business day. Financing data are reported in terms of actual funds paid or received, positions include securities purchased or sold (other than mortgage-backed agency securi- including accrued interest. ties) that have been delivered or are scheduled to be delivered in five business days or less 6. Matched-book data reflect financial intermediation activity in which the borrowing and "when-issued" securities that settle on the issue date of offering. Net immediate and lending transactions are matched. Matched-book data are included in the financing positions for mortgage-backed agency securities include securities purchased or sold that breakdowns given above. The reverse repurchase and repurchase numbers are not always have been delivered or are scheduled to be delivered in thirty business days or less. equal because of the "matching" of securities of different values or different types of Forward positions reflect agreements made in the over-the-counter market that specify collateralization. delayed delivery. Forward contracts for U.S. Treasury securities and federal agency debt NOTE, "n.a." indicates that data are not published because of insufficient activity. securities are included when the time to delivery is more than five business days. Forward Major changes in the report form filed by primary dealers induced a break in the dealer contracts for mortgage-backed agency securities are included when the time to delivery is data series as of the week ending July 6, 1994. more than thirty business days. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A3 3 1.44 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt Outstanding Millions of dollars, end of period 1994 1995 AAggeennccyy 11999900 11999911 11999922 11999933 Sept. Oct. Nov. Dec. Jan. 1 Federal and federally sponsored agencies 434,668 442,772 483,970 570,711 684,129 698,792 715,782 741,992 0 2 Federal agencies 42,159 41,035 41,829 45,193 42,544 39,037 39,662 39,186 39,196 3 Defense Department1 7 7 7 6 6 6 6 6 6 4 Export-Import Bank2'3 11,376 9,809 7,208 5,315 3,932 3,932 3,932 3,455 3,455 5 Federal Housing Administration4 393 397 374 255 112 114 117 116 59 6 Government National Mortgage Association certificates of participation5 0 0 0 0 0 0 0 0 0 7 Postal Service6 6,948 8,421 10,660 9,732 8,973 7,773 8,073 8,073 8,073 8 Tennessee Valley Authority 23,435 22,401 23,580 29,885 29,521 27,212 27,534 27,536 27,603 9 United States Railway Association6 0 0 0 0 0 0 0 0 0 10 Federally sponsored agencies7 392,509 401,737 442,141 525,518 641,585 659,755 676,120 702,806 0 11 Federal Home Loan Banks 117,895 107,543 114,733 141,577 174,414 185,894 193,920 208,881 210,905 12 Federal Home Loan Mortgage Corporation 30,941 30,262 29,631 49,993 83,947 88,680 90,709 93,279 95,060 13 Federal National Mortgage Association 123,403 133,937 166,300 201,112 239,320 242,575 247,743 257,230 250,467 14 Farm Credit Banks8 53,590 52,199 51,910 53,123 54,333 53,609 54,800 53,175 55,558 15 Student Loan Marketing Association 34,194 38,319 39,650 39,784 49,692 49,112 49,066 50,335 0 16 Financing Corporation10 8,170 8,170 8,170 8,170 8,170 8,170 8,170 8,170 8,170 17 Farm Credit Financial Assistance Corporation 1,261 1,261 1,261 1,261 1,261 1,261 1,261 1,261 1,261 18 Resolution Funding Corporation12 23,055 29,996 29,996 29,996 29,996 29,996 29,996 29,996 29,996 MEMO 19 Federal Financing Bank debt13 179,083 185,576 154,994 128,187 109,357 106,935 105,662 103,817 101,157 Lending to federal and federally sponsored agencies 20 Export-Import Bank3 11,370 9,803 7,202 5,309 3,926 3,926 3,926 3,449 3,449 21 Postal Service6 6,698 8,201 10,440 9,732 8,973 7,773 8,073 8,073 8,073 22 Student Loan Marketing Association 4,850 4,820 4,790 4,760 0 0 0 0 0 23 Tennessee Valley Authority 14,055 10,725 6,975 6,325 3,400 3,200 3,200 3,200 3,200 24 United States Railway Association6 0 0 0 0 0 0 0 0 0 Other lending14 25 Farmers Home Administration 52,324 48,534 42,979 38,619 34,129 33,869 33,719 33,719 33,669 26 Rural Electrification Administration 18,890 18,562 18,172 17,578 17,316 17,322 17,365 17,392 17,309 27 Other 70,896 84,931 64,436 45,864 41,613 40,845 39,379 37,984 35,457 1. Consists of mortgages assumed by the Defense Department between 1957 and 1963 10. The Financing Corporation, established in August 1987 to recapitalize the Federal under family housing and homeowners assistance programs. Savings and Loan Insurance Corporation, undertook its first borrowing in October 1987. 2. Includes participation certificates reclassified as debt beginning Oct. 1, 1976. 11. The Farm Credit Financial Assistance Corporation, established in January 1988 to 3. On-budget since Sept. 30, 1976. provide assistance to the Farm Credit System, undertook its first borrowing in July 1988. 4. Consists of debentures issued in payment of Federal Housing Administration 12. The Resolution Funding Corporation, established by the Financial Institutions insurance claims. Once issued, these securities may be sold privately on the securities Reform, Recovery, and Enforcement Act of 1989, undertook its first borrowing in October market. 1989. 5. Certificates of participation issued before fiscal year 1969 by the Government 13. The FFB, which began operations in 1974, is authorized to purchase or sell National Mortgage Association acting as trustee for the Farmers Home Administration, obligations issued, sold, or guaranteed by other federal agencies. Because FFB incurs debt the Department of Health, Education, and Welfare, the Department of Housing and Urban solely for the purpose of lending to other agencies, its debt is not included in the main Development, the Small Business Administration, and the Veterans' Administration. portion of the table in order to avoid double counting. 6. Off-budget. 14. Includes FFB purchases of agency assets and guaranteed loans; the latter are loans 7. Includes outstanding noncontingent liabilities: notes, bonds, and debentures. In- guaranteed by numerous agencies, with the amounts guaranteed by any one agency cludes Federal Agricultural Mortgage Corporation, therefore details do not sum to total. generally being small. The Fanners Home Administration entry consists exclusively of Some data are estimated. agency assets, whereas the Rural Electrification Administration entry consists of both 8. Excludes borrowing by the Farm Credit Financial Assistance Corporation, which is agency assets and guaranteed loans. shown on line 17. 9. Before late 1982, the association obtained financing through the Federal Financing Bank (FFB). Borrowing excludes that obtained from the FFB, which is shown on line 22. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.45 NEW SECURITY ISSUES Tax-Exempt State and Local Governments Millions of dollars 1994 1995 TTyyppee ooff iissssuuee oorr iissssuueerr,, 11999922 11999933 11999944 oorr uussee Aug. Sept. Oct. Nov. Dec. Jan.r Feb/ Mar. 1 All issues, new and refunding' 226,818 279,945 153,922 12,289 7,903 11,053 11,856 9,513 7,717 7,366 11,844 By type of issue 2 General obligation 78,611 90,599 54,404 4,219 2,334 3,202 5,781 2,272 3,770 3,725 5,486 3 Revenue 136,580 189,346 99,518 8,070 5,569 7,851 6,075 7,241 3,947 3,641 6,358 By type of issuer 4 State 24,874 27,999 19,363 1,675 1,009 952 1,528 151 741 1,032 2,315 5 Special district or statutory authority2 138,327 178,714 87,751 7,963 4,962 6,511 6,148 7,501 4,744 4,879 6,567 6 Municipality, county, or township 63,617 73,232 46,808 2,651 1,932 3,590 4,180 1,861 2,232 1,455 2,962 7 Issues for new capital 101,865 91,434 106,799 10,536 6,195 9,127 9,630 8,447 5,706 5,670 10,538 By use of proceeds 8 Education 18,852 16,831 21,360 2,242 833 1,650 1,780 1,713 1,411 1,464 1,666 9 Transportation 14,357 9,167 10,765 1,089 335 1,380 621 304 625 671 454 10 Utilities and conservation 12,164 12,014 10,230 1,108 454 979 976 1,290 538 249 633 11 Social welfare 16,744 13,837 19,917 2,117 1,897 1,887 1,535 2,172 1,182 869 2,556 12 Industrial aid 6,188 6,862 9,054 1,128 403 420 688 1,085 384 215 1,011 13 Other purposes 33,560 32,723 37,250 2,852 2,273 2,811 4,030 1,883 1,566 2,202 4,218 1. Par amounts of long-term issues based on date of sale. SOURCES. Securities Data Company beginning January 1993; Investment 2. Includes school districts. Dealer's Digest before then. 1.46 NEW SECURITY ISSUES U.S. Corporations Millions of dollars 1994 1995 TTyyppee ooff oo rr ii ss ii ss ss uu ss ee uu ,, ee oo rr ffffeerriinngg,, 11999922 11999933 11999944 July Aug. Sept. Oct. Nov. Dec. Jan.r Feb. 1 All issues' 559,827 754,969 n a. 29,818 37,871 29,416 34,481r 38,811r 22,999 30,979 32,829 2 Bonds2 471,502 641,498 n a. 26,159 34,495 25,983 30,909r 33,286r 20,493 28,000 28,000 By type of offering 3 Public, domestic 378,058 486,879 365,05ff 22,441 30,088 22,736 25,192r 21,21%' 17,809 20,000 23,000 4 Private placement, domestic3 65,853 116,240 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 5 Sold abroad 27,591 38,379 56,238r 3,718 4,406 3,248 5,718 6,008 2,684 8,000 5,000 By industry group 6 Manufacturing 82,058 88,002 31,981 2,316 2,596 2,167 2,498 2,49 lr 1,508 2,000 4,000 7 Commercial and miscellaneous 43,111 60,293 27,900r 997 3,570 2,112 2,204 1,578 2,469 2,115 2,600 8 Transportation 9,979 10,756 4,573 248 315 229 227 239 269 0 199 9 Public utility 48,055 56,272 11,713 487 575 707 695 744 273 1,089 810 10 Communication 15,394 31,950 11,986 429 345 526 279 333 419 911 991 11 Real estate and financial 272,904 394,226 333,135r 21,682 27,094 20,242 25,007r 27,902 15,556 21,885 19,400 12 Stocks2 88,325 113,472 n.a. 3,700r 3,375r 3,424r 3,572 5,525 2,768r 2,979 4,829 By type of offering 13 Public preferred 21,339 18,897 12,504 625r 710 555 713r 279 178 505 296 14 Common 57,118 82,657 48,317r 3,075 2,665r 2,868r 2,859r 5,246 2,495' 2,474 4,532 15 Private placement3 9,867 11,917 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. By industry group 16 Manufacturing 22,723 22,271 492 569 904 745 1,963 ll,,220033rr 1,086 1,577 17 Commercial and miscellaneous 20,231 25,761 n.a. 701 838r 821 1,105 1,783 884488rr 392 1,415 18 Transportation 2,595 2,237 75 50 154r 79 76 0 19 15 19 Public utility 6,532 7,050 0 180 78 4 333 165 209 258 20 Communication 2,366 3,439 0 0 0 0 0 21r 496 0 21 Real estate and financial 33,879 52,021 2,427r 1,734r l,466r 1,639 1,351 531r 776 1,564 1. Figures represent gross proceeds of issues maturing in more than one year; they are 2. Monthly data cover only public offerings. the principal amount or number of units calculated by multiplying by the offering price. 3. Monthly data are not available. Figures exclude secondary offerings, employee stock plans, investment companies other SOURCES. Beginning July 1993, Securities Data Company and the Board of Governors than closed-end, intracorporate transactions, equities sold abroad, and Yankee bonds. of the Federal Reserve System. Stock data include ownership securities issued by limited partnerships. 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 Assets1 Millions of dollars 1994 1995 IItteemm 11999933 11999944 July Aug. Sept. Oct. Nov. Dec. Jan. Feb. 1 Sales of own shares2 851,885 841,286 59,258 64,833 62,263 59,285 56,849 73,183 75,099 64,434 2 Redemptions of own shares 567,881 699,823 50,275 53,242 53,383 53,743 55,757 70,747 63,737 55,961 3 Net sales3 284,004 141,463 8,983 1,592 8,880 5,543 1,092 2,436 11,362 8,573 4 Assets4 1,510,209 1,550,490 1,552,652 1,604,961 1,588,277 1,601,363 1,549,186 1,550,490 1,563,187 1,619,991 5 Cash5 100,209 121,296 120,129 120,315 121,575 126,766 125,843 121,296 124,351 127,099 6 Other 1,409,838 1,429,195 1,432,523 1,484,646 1,466,702 1,474,597 1,423,344 1,429,195 1,438,836 1,492,893 1. Data on sales and redemptions exclude money market mutual funds but include 4. Market value at end of period, less current liabilities. limited-maturity municipal bond funds. Data on asset positions exclude both money 5. Includes all U.S. Treasury securities and other short-term debt securities. market mutual funds and limited-maturity municipal bond funds. SOURCE. Investment Company Institute. Data based on reports of membership, which 2. Includes reinvestment of net income dividends. Excludes reinvestment of capital comprises substantially all open-end investment companies registered with the Securities gains distributions and share issue of conversions from one fund to another in the same and Exchange Commission. Data reflect underwritings of newly formed companies after group. their initial offering of securities. 3. Excludes sales and redemptions resulting from transfers of shares into or out of money market mutual funds within the same fund family. 1.48 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data at seasonally adjusted annual rates 1993 1994 AAccccoouunntt 11999922 11999933 11999944 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 Profits with inventory valuation and capital consumption adjustment 405.1 485.8 542.7 442.5 473.1 493.5 533.9 508.2 546.4 556.0 560.3 2 Profits before taxes 395.9 462.4 524.5 432.7 456.6 458.7 501.7 483.5 523.1 538.1 553.5 3 Profits-tax liability 139.7 173.2 202.5 159.8 171.8 169.9 191.5 184.1 201.7 208.6 215.6 4 Profits after taxes 256.2 289.2 322.0 273.0 284.8 288.9 310.2 299.4 321.4 329.5 337.9 5 Dividends 171.1 191.7 205.2 188.2 190.7 193.2 194.6 196.3 202.5 207.9 213.9 6 Undistributed profits 85.1 97.5 116.9 84.7 94.1 95.6 115.6 103.0 118.9 121.6 124.0 7 Inventory valuation -6.4 -6.2 -19.5r -11.2 -10.0 3.0 -6.5 -12.3 -14.1 -19.6 -32. lr 8 Capital consumption adjustment 15.7 29.5 37.7 21.0 26.5 31.7 38.8 37.0 37.4 37.5 38.8 SOURCE. U.S. Department of Commerce, Survey of Current Business. 1.50 NONFARM BUSINESS EXPENDITURES New Plant and Equipment Billions of dollars; quarterly data at seasonally adjusted annual rates 1993 1994 IInndduussttrryy 11999922 11999933 1199994411 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q41 1 Total nonfarm business 546.60 586.73 638.37 563.48 578.95 594.56 604.51 61934 637.08 651.92 645.13 Manufacturing 2 Durable goods industries 73.32 81.45 92.78 78.19 80.33 82.74 83.64 86.03 91.71 98.97 94.44 3 Nondurable goods industries 100.69 98.02 99.77 95.80 97.22 99.74 98.51 99.02 102.28 98.39 99.39 Nonmanufacturing 4 Mining 8.88 10.08 11.24 8.98 9.10 11.09 10.92 11.43 10.70 11.57 11.27 Transportation 5 Railroad 6.67 6.14 6.72 6.16 5.94 5.89 6.55 7.46 5.36 6.65 7.40 6 Air 8.93 6.42 3.95 7.26 6.63 6.70 5.06 4.23 4.53 3.86 3.16 7 Other 7.04 9.22 10.53 8.96 8.92 8.74 10.23 10.77 9.70 10.22 11.42 Public utilities 8 Electric 48.22 52.55 52.25 49.98 50.61 52.96 55.60 48.68 53.55 54.15 52.60 9 Gas and other 23.99 23.43 24.20 23.79 23.83 22.98 23.27 24.51 22.96 24.35 24.97 10 Commercial and other2 268.84 299.44 336.93 284.35 296.35 303.74 310.73 327.20 336.28 343.76 340.48 1. Figures are amounts anticipated by business. SOURCE. U.S. Department of Commerce, Survey of Current Business. 2. "Other" consists of construction, wholesale and retail trade, finance and insurance, personal and business services, and communication. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.51 DOMESTIC FINANCE COMPANIES Assets and Liabilities1 Billions of dollars, end of period; not seasonally adjusted 1993 1994 AAccccoouunntt 11999922 11999933 11999944 Q2 Q3 Q4 Q1 Q2 Q3 Q4 ASSETS 1 Accounts receivable, gross2 491.8 482.8 551.0 473.7 474.0 482.8 494.5 511.3 524.1 551.0 2 Consumer 118.3 116.5 134.8 110.6 111.0 116.5 120.1 124.3 130.3 134.8 I Business 301.3 294.6 337.6 291.8 291.9 294.6 302.3 313.2 317.2 337.6 4 Real estate 72.2 71.7 78.5 71.4 71.1 71.7 72.1 73.8 76.6 78.5 5 LESS: Reserves for unearned income 53.2 50.7 55.0 49.7 49.5 50.7 51.2 51.9 51.1 55.0 6 Reserves for losses 16.2 11.2 12.4 10.8 11.2 11.2 11.6 12.1 12.1 12.4 7 Accounts receivable, net 422.4 420.9 483.5 413.2 413.3 420.9 431.7 447.3 460.9 483.5 8 All other 142.5 170.9 183.4 151.5 163.9 170.9 171.2 174.6 177.2 183.4 9 Total assets 564.9 591.8 666.9 564.7 577.3 591.8 602.9 621.9 638.1 666.9 LIABILITIES AND CAPITAL 10 Bank loans 37.6 25.3 21.2 29.4 25.8 25.3 24.2 23.3 21.6 21.2 11 Commercial paper 156.4 159.2 184.6 144.5 149.9 159.2 165.9 171.2 171.0 184.6 Debt 12 Other short-term n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 13 Long-term n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 14 Owed to parent 39.5 42.7 51.0 45.0 44.6 42.7 41.1 44.7 50.0 51.0 15 Not elsewhere classified 196.3 206.0 235.0 199.9 204.2 206.0 211.7 219.6 228.2 235.0 16 All other liabilities 68.0 87.1 99.5 77.8 83.8 87.1 90.5 89.9 95.0 99.5 17 Capital, surplus, and undivided profits 67.1 71.4 75.7 68.1 68.9 71.4 69.5 73.2 72.3 75.7 18 Total liabilities and capital 564.9 591.8 666.9 564.7 577.3 591.8 602.9 621.9 638.1 666.9 1. Includes finance company subsidiaries of bank holding companies but not of 2. Before deduction for unearned income and losses, retailers and banks. Data are amounts carried on the balance sheets of finance companies; securitized pools are not shown, as they are not on the books. 1.52 DOMESTIC FINANCE COMPANIES Consumer, Real Estate, and Business Credit1 Millions of dollars, amounts outstanding, end of period 1994 1995 TTyyppee ooff ccrreeddiitt 11999922 11999933 11999944 Sept. Oct. Nov. Dec. Jan.r Feb. Seasonally adjusted 11 TToottaall 540,679 546,020 610,710 590,512 596,397 602,463 610,710 619,005 624,771 22 CCoonnssuummeerr 157,857 160,802 174,059 172,547 173,178 174,324 174,059 175,601 175,024 33 RReeaall eessttaattee22 72,496 71,991 78,774 76,424 76,971 77,991 78,774 79,097 80,539 44 BBuussiinneessss 310,325 313,226 357,877 341,542 346,248 350,148 357,877 364,307 369,208 Not seasonally adjusted 5 Total 544,691 550,387 615,758 588,525 596,054 603,305 615,758 618,387 624,407 6 Consumer 159,558 162,770 176,316 172,002 172,813 174,118 176,316 176,591 175,869 7 Motor vehicles 57,259 56,057 61,609 60,522 60,750 61,372 61,609 62,321 61,067 8 Other consumer3 61,020 60,396 73,221 69,784 70,812 71,502 73,221 74,385 73,937 9 Securitized motor vehicles4 29,734 36,024 31,861 32,372 31,592 31,494 31,861 30,261 31,303 10 Securitized other consumed 11,545 10,293 9,625 9,324 9,659 9,750 9,625 9,624 9,562 11 Real estate2 72,243 71,727 78,479 76,585 77,235 77,907 78,479 79,592 80,754 12 Business 312,890 315,890 360,963 339,938 346,006 351,280 360,963 362,204 367,784 13 Motor vehicles 89,011 95,173 118,197 106,365 110,089 113,222 118,197 118,979 121,818 14 Retail5 20,541 18,091 21,514 21,164 21,645 22,113 21,514 21,809 21,577 15 Wholesale6 29,890 31,148 35,037 27,201 29,302 30,614 35,037 34,493 36,759 16 Leasing 38,580 45,934 61,646 58,000 59,142 60,495 61,646 62,677 63,482 17 Equipment 151,424 145,452 157,953 152,782 152,675 154,312 157,953 158,798 159,333 18 Retail 33,521 35,513 39,680 39,357 38,584 38,912 39,680 40,387 40,329 19 Wholesale6 8,680 8,001 9,678 9,119 9,134 9,484 9,678 9,372 9,462 20 Leasing 109,223 101,938 108,595 104,306 104,957 105,916 108,595 109,039 109,542 21 Other business7 60,856 53,997 61,495 58,101 59,314 59,893 61,495 61,304 63,339 22 Securitized business assets4 11,599 21,268 23,318 22,690 23,928 23,853 23,318 23,123 23,294 23 Retail 1,120 2,483 3,065 2,564 2,956 2,853 3,065 2,901 2,764 24 Wholesale 5,756 10,584 14,499 14,411 15,173 15,311 14,499 14,621 15,144 25 Leasing 4,723 8,201 5,754 5,715 5,799 5,689 5,754 5,601 5,386 1. Includes finance company subsidiaries of bank holding companies but not of 4. Outstanding balances of pools upon which securities have been issued; these retailers and banks. Data are before deductions for unearned income and losses. Data in balances are no longer carried on the balance sheets of the loan originator. this table also appear in the Board's G.20 (422) monthly statistical release. For ordering 5. Passenger car fleets and commercial land vehicles for which licenses are required. address, see inside front cover. 6. Credit arising from transactions between manufacturers and dealers, that is, floor 2. Includes all loans secured by liens on any type of real estate, for example, first and plan financing. junior mortgages and home equity loans. 7. Includes loans on commercial accounts receivable, factored commercial accounts, 3. Includes personal cash loans, mobile home loans, and loans to purchase other types and receivable dealer capital; small loans used primarily for business or farm purposes; of consumer goods such as appliances, apparel, general merchandise, and recreation and wholesale and lease paper for mobile homes, campers, and travel trailers. Digitized for FRveAhiScleEs.R http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Real Estate A3 7 1.53 MORTGAGE MARKETS Mortgages on New Homes Millions of dollars except as noted 1994 1995 IItteemm 11999922 11999933 11999944 Sept. Oct. Nov. Dec. Jan. Feb. Mar. Terms and yields in primary and secondary markets PRIMARY MARKETS Terms1 1 Purchase price (thousands of dollars) 158.1 163.1 170.4 170.6 173.4 178.2 184.9 176.5 175.6 173.3 2 Amount of loan (thousands of dollars) 118.1 123.0 130.8 133.7 131.9 136.2 136.2 134.2 135.6 132.6 3 Loan-to-price ratio (percent) 76.6 78.0 78.8 79.4 78.3 78.0 76.9 78.0 79.3 78.2 4 Maturity (years) 25.6 26.1 27.5 27.9 27.6 27.9 28.0 28.0 28.3 28.6 5 Fees and charges (percent of loan amount) 1.60 1.30 1.29 1.36 1.22 1.30 1.38 1.31 1.32 1.18 Yield (percent per year) 6 Contract rate1 7.98 7.03 7.26 7.48 7.55 7.59 7.61 7.96 8.07 8.02 7 Effective rate1'3 8.25 7.24 7.47 7.70 7.76 7.81 7.83 8.18 8.28 8.21 8 Contract rate (HUD series)4 8.43 7.37 8.58 8.96 9.19 9.34 9.32 9.11 8.79 8.60 SECONDARY MARKETS Yield (percent per year) 9 FHA mortgages (Section 203)5 8.46 7.46 8.68 9.10 9.23 9.53 9.54 9.10 9.05 8.60 10 GNMA securities6 7.71 6.65 7.96 8.28 8.67 8.86 8.76 8.69 8.38 8.08 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 11 Total 158,119 190,861 222,057 215,249 218,479 220,377 222,057 222,774 223,137 223,956 12 FHA/VA insured 22,593 23,857 28,377 25,800 26,226 27,118 28,377 28,368 28,420 28,672 13 Conventional 135,526 167,004 194,499 189,449 192,253 193,259 194,499 195,170 195,439 195,998 Mortgage transactions (during period) 14 Purchases 75,905 92,037 62,389 4,266 5,003 3,549 3,399 2,154 1,802 2,390 Mortgage commitments (during period) 15 Issued7 74,970 92,537 54,038 4,880 3,421 2,696 2,910 1,720 1,683 3,372 16 To sell8 10,493 5,097 1,820 0 48 20 55 57 82 64 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period f 17 Total 33,665 55,012 72,693 66,478 69,340 70,757 72,693 73,553 75,184 77,313 18 FHA/VA insured 352 321 276 287 284 279 276 272 270 266 19 Conventional 33,313 54,691 72,416 66,191 69,057 70,477 72,416 73,281 74,914 77,047 Mortgage transactions (during period) 20 Purchases 191,125 229,242 124,697 5,512 8,351 3,022 4,890 3,254 5,537 4,609 21 179,208 208,723 117,110 5,213 8,139 2,865 3,769 2,862 4,806 3,546 Mortgage commitments (during periodf 22 Contracted 261,637 274,599 136,067 5,035 7,288 3,454 2,412 6,541 7,741 12,704 1. Weighted averages based on sample surveys of mortgages originated by major 6. Average net yields to investors on fully modified pass-through securities backed by institutional lender groups for purchase of newly built homes; compiled by the Federal mortgages and guaranteed by the Government National Mortgage Association (GNMA), Housing Finance Board in cooperation with the Federal Deposit Insurance Corporation. assuming prepayment in twelve years on pools of thirty-year mortgages insured by the 2. Includes all fees, commissions, discounts, and "points" paid (by the borrower or Federal Housing Administration or guaranteed by the Department of Veterans Affairs. the seller) to obtain a loan. 7. Does not include standby commitments issued, but includes standby commitments 3. Average effective interest rate on loans closed for purchase of newly built homes, converted. assuming prepayment at the end of ten years. 8. Includes participation loans as well as whole loans. 4. Average contract rate on new commitments for conventional first mortgages; from 9. Includes conventional and government-underwritten loans. The Federal Home Loan U.S. Department of Housing and Urban Development (HUD). Based on transactions on Mortgage Corporation's mortgage commitments and mortgage transactions include activthe first day of the subsequent month. ity under mortgage securities swap programs, whereas the corresponding data for FNMA 5. Average gross yield on thirty-year, minimum-downpayment first mortgages exclude swap activity. insured by the Federal Housing Administration (FHA) for immediate delivery in the private secondary market. Based on transactions on first day of subsequent month. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.54 MORTGAGE DEBT OUTSTANDING1 Millions of dollars, end of period 1993 1994 TTyyppee ooff hhoollddeerr aanndd pprrooppeerrttyy 11999911 11999922 11999933 Q4 Q1 Q2 Q3 Q4 1 All holders 3,926,154 4,056,233 4,215,480 4,215,480 4,242,350 4300,086 4,361,119 4,409,390 By type of property 2 One- to four-family residences 2,781,327 2,963,391 3,147,255 3,147,255 3,181,125 3,234,663 3,291,915 3,339,190 3 Multifamily residences 306,551 295,417 290,489 290,489 289,236 290,807 292,180 292,151 4 Commercial 759,154 716,687 696,542 696,542 690,718 692,764 694,736 695,548 5 79,122 80,738 81,194 81,194 81,272 81,853 82,288 82,500 By type of holder 6 Major financial institutions 1,846,726 1,769,187 1,767,835 1,767,835 1,746,474 1,763,296 1,786,171 1,813,751 7 Commercial banks2 876,100 894,513 940,444 940,444 937,944 956,840 981,365 1,004,237 8 One- to four-family 483,623 507,780 556,538 556,538 553,894 569,512 592,021 609,521 9 Multifamily 36,935 38,024 38,635 38,635 38,690 38,609 38,004 39,289 10 Commercial 337,095 328,826 324,409 324,409 324,106 326,800 328,931 332,859 11 Farm 18,447 19,882 20,862 20,862 21,254 21,918 22,408 22,567 12 Savings institutions3 705,367 627,972 598,330 598,330 584,531 585,671 587,538 596,035 13 One- to four-family 538,358 489,622 469,959 469,959 458,057 462,219 466,697 477,144 14 Multifamily 79,881 69,791 67,362 67,362 66,924 66,281 65,530 64,557 15 Commercial 86,741 68,235 60,704 60,704 59,253 56,872 55,019 54,048 16 Farm 388 324 305 305 297 299 291 286 17 Life insurance companies 265,258 246,702 229,061 229,061 223,999 220,785 217,269 213,479 18 One- to four-family 11,547 11,441 9,458 9,458 9,245 9,107 8,956 8,794 19 Multifamily 29,562 27,770 25,814 25,814 25,232 24,855 24,442 24,002 20 Commercial 214,105 198,269 184,305 184,305 180,152 177,463 174,514 171,368 21 Farm 10,044 9,222 9,484 9,484 9,370 9,360 9,357 9,315 22 Federal and related agencies 266,146 286,263 317,486 317,486 323,464 327,690 334,359 335,228 23 Government National Mortgage Association 19 30 22 22 20 12 12 6 24 One- to four-family 19 30 15 15 13 12 12 6 25 Multifamily 0 0 7 7 7 0 0 0 26 Farmers Home Administration4 41,713 41,695 41,386 41,386 41,209 41,370 41,587 41,781 27 One- to four-family 18,496 16,912 15,303 15,303 14,870 14,459 14,084 13,826 28 Multifamily 10,141 10,575 10,940 10,940 11,037 11,147 11,243 11,319 29 Commercial 4,905 5,158 5,406 5,406 5,399 5,526 5,608 5,670 30 Farm 8,171 9,050 9,739 9,739 9,903 10,239 10,652 10,966 31 Federal Housing and Veterans' Administrations 10,733 12,581 12,215 12,215 11,344 11,169 10,533 10,964 32 One- to four-family 4,036 5,153 5,364 5,364 4,738 4,826 4,321 4,753 33 Multifamily 6,697 7,428 6,851 6,851 6,606 6,343 6,212 6,211 34 Resolution Trust Corporation 45,822 32,045 17,284 17,284 14,241 13,908 15,403 10,428 35 One- to four-family 14,535 12,960 7,203 7,203 6,308 6,045 6,998 5,200 36 Multifamily 15,018 9,621 5,327 5,327 4,208 4,230 4,569 2,859 37 Commercial 16,269 9,464 4,754 4,754 3,726 3,633 3,836 2,369 38 Farm 0 0 0 0 0 0 0 0 39 Federal National Mortgage Association 112,283 137,584 166,642 166,642 172,343 175,377 177,200 178,059 40 One- to four-family 100,387 124,016 151,310 151,310 156,576 159,437 161,255 162,160 41 Multifamily 11,896 13,568 15,332 15,332 15,767 15,940 15,945 15,899 42 Federal Land Banks 28,767 28,664 28,460 28,460 28,181 28,475 28,538 28,565 43 One- to four-family 1,693 1,687 1,675 1,675 1,658 1,675 1,679 1,681 44 Farm 27,074 26,977 26,785 26,785 26,523 26,800 26,859 26,885 45 Federal Home Loan Mortgage Corporation 26,809 33,665 51,476 51,476 56,127 57,379 61,087 65,424 46 One- to four-family 24,125 31,032 48,929 48,929 53,571 54,799 58,432 62,594 47 Multifamily 2,684 2,633 2,547 2,547 2,556 2,580 2,655 2,830 48 Mortgage pools or trusts5 1,250,666 1,425,546 1,550,818 1,550,818 1,604,449 1,643,627 1,668,496 1,683,946 49 Government National Mortgage Association 425,295 419,516 414,066 414,066 423,446 435,709 444,976 450,934 50 One- to four-family 415,767 410,675 404,864 404,864 414,194 426,363 435,511 441,198 51 Multifamily 9,528 8,841 9,202 9,202 9,251 9,346 9,465 9,736 52 Federal Home Loan Mortgage Corporation 359,163 407,514 443,029 443,029 459,949 470,183 469,062 467,071 53 One- to four-family 351,906 401,525 438,494 438,494 455,779 466,361 465,614 463,945 54 Multifamily 7,257 5,989 4,535 4,535 4,170 3,822 3,448 3,126 55 Federal National Mortgage Association 371,984 444,979 495,525 495,525 507,376 514,855 523,512 530,343 56 One- to four-family 362,667 435,979 486,804 486,804 498,489 505,730 514,375 520,763 57 Multifamily 9,317 9,000 8,721 8,721 8,887 9,125 9,137 9,580 58 Farmers Home Administration4 47 38 28 28 26 22 20 19 59 One- to four-family 11 8 5 5 5 4 4 3 60 Multifamily 0 0 0 0 0 0 0 0 61 Commercial 19 17 13 13 12 10 9 9 62 Farm 17 13 10 10 9 8 7 7 63 Private mortgage conduits 94,177 153,499 198,171 198,171 213,653 222,858 230,926 235,579 64 One- to four-family 84,000 132,000 164,000 164,000 177,000 179,500 182,300 183,600 65 Multifamily 3,698 6,305 8,701 8,701 9,202 11,514 13,891 14,850 66 Commercial 6,479 15,194 25,469 25,469 27,451 31,844 34,735 37,129 67 Farm 0 0 0 0 0 0 0 0 68 Individuals and others6 562,616 575,237 579,341 579,341 567,963 565,473 572,092 576,465 69 One- to four-family 370,157 382,572 387,334 387,334 376,728 374,612 379,656 384,001 70 Multifamily 83,937 85,871 86,516 86,516 86,700 87,014 87,638 87,893 71 Commercial 93,541 91,524 91,482 91,482 90,621 90,617 92,084 92,096 72 14,981 15,270 14,009 14,009 13,915 13,229 12,714 12,474 1. Multifamily debt refers to loans on structures of five or more units. 6. Other holders include mortgage companies, real estate investment trusts, state and 2. Includes loans held by nondeposit trust companies but not loans held by bank trust local credit agencies, state and local retirement funds, noninsured pension funds, credit departments. unions, and finance companies. 3. Includes savings banks and savings and loan associations. SOURCES. Based on data from various institutional and government sources. Separation 4. FmHA-guaranteed securities sold to the Federal Financing Bank were reallocated of nonfarm mortgage debt by type of property, if not reported directly, and interpolations from FmHA mortgage pools to FmHA mortgage holdings in 1986:Q4 because of and extrapolations, when required for some quarters, are estimated in part by the Federal accounting changes by the Farmers Home Administration. Reserve. Line 64 from Inside Mortgage Securities. 5. Outstanding principal balances of mortgage-backed securities insured or guaranteed by the agency indicated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Consumer Installment Credit A39 1.55 CONSUMER INSTALLMENT CREDIT1 Millions of dollars, amounts outstanding, end of period 1994 1995 HHoollddeerr aanndd ttyyppee ooff ccrreeddiitt 11999922 11999933 11999944 Sept. Oct. Nov. Dec. Jan.r Feb. Seasonally adjusted 1 Total 731,098 794,300 911,311 879,961 891,603 904,757 911,311 920,337 928,496 2 Automobile 257,678 282,036 324,519 315,162 318,036 323,447 324,519 324,855 327,704 3 Revolving 257,304 287,875 337,694 322,823 327,707 334,843 337,694 343,184 349,471 4 Other 216,117 224,389 249,098 241,976 245,860 246,467 249,098 252,298 251,321 Not seasonally adjusted 5 Total 747,690 812,782 932,890 880,609 891,442 906,436 932,890 929,329 928,612 By major holder 6 Commercial banks 330,088 368,549 434,790 410,312 414,833 421,790 434,790 431,745 432,883 7 Finance companies 118,279 116,453 134,830 130,306 131,562 132,874 134,830 136,706 135,004 8 Credit unions 91,694 101,634 120,158 114,699 116,325 117,984 • 120,158 120,668 121,067 9 Savings institutions 37,049 37,855 38,750 37,943 38,122 38,275 38,750 39,250 39,399 10 Nonfinancial business 49,184 57,637 64,944 55,967 56,020 58,247 64,944 61,382 59,169 11 Pools of securitized assets2 121,396 130,654 139,418 131,382 134,580 137,266 139,418 139,578 141,090 By major type of credit3 12 Automobile 258,226 282,825 325,536 316,778 320,182 323,744 325,536 324,826 326,754 13 Commercial banks 109,623 123,358 148,117 144,260 146,456 148,004 148,117 147,319 148,355 14 Finance companies 57,259 56,057 61,609 60,522 60,750 61,372 61,609 62,321 61,067 15 Pools of securitized assets2 33,888 39,490 34,515 35,149 34,394 34,301 34,515 32,902 33,936 16 Revolving 271,368 303,444 355,859 321,205 325,872 336,575 355,859 350,035 349,169 17 Commercial banks 132,966 149,527 180,530 164,724 165,561 171,318 180,530 176,635 177,241 18 Nonfinancial business 43,974 52,113 58,870 50,314 50,332 52,475 58,870 55,405 53,257 19 Pools of securitized assets2 74,931 79,887 93,545 85,051 88,762 91,469 93,545 95,015 95,724 20 Other 218,096 226,513 251,495 242,626 245,388 246,117 251,495 254,468 252,689 21 Commercial banks 87,499 95,664 106,143 101,328 102,816 102,468 106,143 107,791 107,287 22 Finance companies 61,020 60,396 73,221 69,784 70,812 71,502 73,221 74,385 73,937 23 Nonfinancial business 5,210 5,524 6,074 5,653 5,688 5,772 6,074 5,977 5,912 24 Pools of securitized assets2 12,577 11,277 11,358 11,182 11,424 11,496 11,358 11,661 11,430 1. The Board's series on amounts of credit covers most short- and intermediate-term 2. Outstanding balances of pools upon which securities have been issued; these credit extended to individuals that is scheduled to be repaid (or has the option of balances are no longer carried on the balance sheets of the loan originator. repayment) in two or more installments. 3. Totals include estimates for certain holders for which only consumer credit totals are Data in this table also appear in the Board's G.19 (421) monthly statistical release. For available. ordering address, see inside front cover. 1.56 TERMS OF CONSUMER INSTALLMENT CREDIT1 Percent per year except as noted 1994 1995 IItteemm 11999922 11999933 11999944rr Aug. Sept. Oct. Nov. Dec. Jan. Feb. INTEREST RATES Commercial banks2 1 48-month new car 9.29 8.09 8.12 8.41 n.a. n.a. 8.75 n.a. n.a. 9.70 2 24-month personal 14.04 13.47 13.19 13.33 n.a. n.a. 13.59 n.a. n.a. 14.10 Credit card plan 3 All accounts n.a. n.a. 15.91 n.a. n.a. n.a. 15.91 n.a. n.a. 16.24 4 Accounts assessed interest n.a. n.a. 15.74 n.a. n.a. n.a. 15.74 n.a. n.a. 15.29 Auto finance companies 5 New car 9.93 9.48 9.79 10.32 10.13 10.39 10.53 10.72 11.35 11.89 6 Used car 13.80 12.79r 13.49r 13.92r 13.98r 14.01r 14.19r 14.48r 14.57' 15.06 OTHER TERMS3 Maturity (months) 7 New car 54.0 54.5 54.0 54.2 54.3 54.9 54.6 53.9 53.9 54.1 8 Used car 47.9r 48.8r 50.2r so. r 50.2r 50.2r 50.3r 50.3r 52.0 52.0 Loan-to-value ratio 9 New car 89 91 92 93 93 92 93 92 92 92 10 Used car 97 98 99 100 100 100 100 100 99 99 Amount financed (dollars) 11 New car 13,584 14,332 15,375 15,283 15,419 15,827 15,971 16,187 16,068 15,774 12 Used car 9,119 9,875 10,709 10,755 10,906 10,554 11,202 11,309 11,185 11,181 1. The Board's series on amounts of credit covers most short- and intermediate-term 2. Data are available for only the second month of each quarter, credit extended to individuals that is scheduled to be repaid (or has the option of 3. At auto finance companies, repayment) in two or more installments. Data in this table also appear in the Board's G.19 (421) monthly statistical release. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS1 Billions of dollars; quarterly data at seasonally adjusted annual rates 1993 1994 11999900 11999911 11999922 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Nonfinancial sectors 1 Total net borrowing by domestic nonfinancial sectors.... 635.6 475.8 536.1 628.1 619.5 740.5 613.3 677.2 657.1 550.6 620.8 649.5 By sector and instrument 2 U.S. government 246.9 278.2 304.0 256.1 155.9 336.4 173.4 274.2 210.5 122.9 135.0 155.0 3 Treasury securities 238.7 292.0 303.8 248.3 155.7 332.3 157.2 266.5 211.8 118.2 130.7 162.1 4 Budget agency issues and mortgages 8.2 -13.8 .2 7.8 .2 4.1 16.2 7.7 -1.3 4.7 4.3 -7.1 5 Private 388.7 197.5 232.1 372.0 463.7 404.1 439.9 403.0 446.6 427.7 485.8 494.5 By instrument 6 Tax-exempt obligations 48.7 68.7 31.1 78.1 -15.1 130.3 66.2 27.4 22.6 -9.8 -41.2 -32.1 7 Corporate bonds 47.1 78.8 67.5 75.2 21.9 75.7 72.0 67.4 35.5 35.8 14.0 2.4 8 Mortgages 199.5 161.4 123.9 155.7 194.1 152.2 222.2 148.5 163.0 188.6 239.8 185.0 9 Home mortgages 185.6 163.8 179.5 183.9 191.9 193.5 236.5 184.5 191.2 172.3 224.8 179.5 10 Multifamily residential 4.8 -3.1 -11.2 -6.1 1.7 -11.4 -4.9 -2.6 -5.1 6.1 5.5 .4 11 Commercial 9.3 .4 -45.5 -22.5 -.9 -30.9 -9.9 -33.6 -23.4 7.8 7.8 4.3 12 Farm -.3 .4 1.1 .5 1.3 1.0 .4 .2 .3 2.3 1.7 .8 13 Consumer credit 16.0 -15.0 5.5 62.3 117.5 41.6 76.2 111.3 72.7 121.9 125.9 149.4 14 Bank loans n.e.c .4 -40.9 -13.8 5.0 77.6 -.2 7.8 28.5 68.2 57.9 89.4 94.8 15 Commercial paper 9.7 -18.4 8.6 10.0 21.4 33.2 17.2 3.8 8.0 16.4 33.8 27.2 16 Other loans 67.4 -37.1 9.2 -14.4 46.3 -28.6 -21.7 16.2 76.5 16.9 24.1 67.8 By borrowing sector 17 Household 218.9 170.9 217.7 284.5 349.6 264.1 368.5 337.7 304.3 316.0 387.7 390.5 18 Nonfinancial business 123.7 -35.9 -2.0 21.9 143.3 26.7 24.1 48.2 135.8 139.9 146.8 150.7 19 Farm 2.3 2.1 1.0 2.0 2.3 2.7 4.1 3.6 2.6 8.1 1.7 -3.2 20 Nonfarm noncorporate 10.1 -28.5 -43.9 -26.0 19.8 -33.4 -26.2 -15.6 8.4 18.5 28.9 23.2 21 Corporate 111.3 -9.6 40.9 45.8 121.2 57.4 46.3 60.2 124.7 113.2 116.2 130.7 22 State and local government 46.0 62.6 16.4 65.7 -29.3 113.2 47.3 17.1 6.5 -28.2 -48.7 -46.6 23 Foreign net borrowing in United States 23.9 13.9 21.3 46.9 -12.1 42.8 83.1 22.9 -66.3 -10.1 4.1 23.9 24 Bonds 21.4 14.1 14.4 59.4 17.1 45.3 84.5 41.4 29.0 9.4 4.9 25.2 25 Bank loans n.e.c -2.9 3.1 2.3 .7 1.4 6.6 1.0 -6.3 6.0 -4.5 4.7 -.5 26 Commercial paper 12.3 6.4 5.2 -9.0 -27.3 -.6 -1.6 -12.0 -101.8 -5.2 -8.1 5.9 27 U.S. government and other loans -7.0 -9.8 -.6 -4.2 -3.3 -8.4 -.8 -.1 .5 -9.8 2.8 -6.6 28 Total domestic plus foreign 659.4 489.6 557.4 675.0 607.4 783.3 696.4 700.2 590.8 540.5 624.9 673.4 Financial sectors 29 Total net borrowing by financial sectors 202.9 152.6 237.1 286.1 419.9 175.5 438.9 349.8 488.9 343.5 367.7 479.6 By instrument 30 U.S. government-related 167.4 145.7 155.8 161.2 268.2 56.6 287.3 131.3 320.8 245.2 224.9 281.7 31 Government-sponsored enterprises securities 17.1 9.2 40.3 80.6 177.2 68.8 167.8 53.4 160.0 146.6 152.1 250.2 32 Mortgage pool securities 150.3 136.6 115.6 80.6 95.7 -12.2 119.5 77.9 180.0 98.6 72.8 31.5 33 Loans from U.S. government -.1 .0 .0 .0 -4.8 .0 .0 .0 -19.2 .0 .0 .0 34 Private 35.5 6.8 81.3 125.0 151.8 118.9 151.6 218.5 168.2 98.3 142.8 197.9 35 Corporate bonds 46.3 67.6 78.5 118.3 103.3 92.4 143.4 138.3 154.5 91.9 84.3 82.8 36 Mortgages .6 .5 .6 3.6 -.2 1.4 6.2 5.5 .2 .6 .1 -1.5 37 Bank loans n.e.c 4.7 8.8 2.2 -14.0 -15.8 12.8 -16.1 -18.0 -12.3 -30.1 -14.6 -6.2 38 Open market paper 8.6 -32.0 -.7 -6.2 41.6 -16.2 -9.4 76.0 36.6 3.6 42.3 84.0 39 Loans from Federal Home Loan Banks -24.7 -38.0 .8 23.3 22.8 28.4 27.4 16.8 -10.8 32.3 30.7 38.8 By borrowing sector 40 Government-sponsored enterprises 17.0 9.1 40.2 80.6 172.4 68.8 167.8 53.4 140.8 146.6 152.1 250.2 41 Federally related mortgage pools 150.3 136.6 115.6 80.6 95.7 -12.2 119.5 77.9 180.0 98.6 72.8 31.5 42 Private 35.5 6.8 81.3 125.0 151.8 118.9 151.6 218.5 168.2 98.3 142.8 197.9 43 Commercial banks -.7 -11.7 8.8 5.6 10.0 11.3 6.5 1.2 2.0 12.4 22.8 2.9 44 Bank holding companies -27.7 -2.5 2.3 8.8 8.4 1.3 .5 12.2 3.5 10.1 11.5 8.5 45 Funding corporations 15.4 -6.5 13.2 2.9 25.8 -1.6 7.9 36.7 48.2 -17.9 46.5 26.3 46 Savings institutions -30.2 -44.5 -6.7 11.1 12.8 12.6 13.5 8.8 -5.6 5.8 14.8 36.1 47 Credit unions .0 .0 .0 .2 .2 .3 .3 .1 .1 .2 .5 .2 48 Life insurance companies .0 .0 .0 .2 .3 .6 -.1 .4 .0 .0 .0 1.3 49 Finance companies 24.0 18.6 -3.6 .2 50.3 -13.6 17.5 16.3 63.3 67.0 16.9 54.0 50 Mortgage companies .0 -2.4 8.0 -1.0 -13.0 32.4 -.8 -10.4 -21.6 -18.2 -7.0 -5.0 51 Real estate investment trusts (REITs) .8 1.2 .3 3.5 1.7 1.3 6.0 6.2 1.2 2.2 2.3 1.1 52 Issuers of asset-backed securities (ABSs) 52.3 51.0 56.3 81.5 54.7 60.5 85.8 117.6 86.9 36.5 42.2 53.1 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 MARKETS1—Continued 1993 1994 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999900 11999911 11999922 11999933 11999944 Q2 Q3 Q4 Q1 Q2 Q3 Q4 All sectors 53 Total net borrowing, all sectors 862.3 642.2 794.5 961.2 1,027.3 958.8 1,135.3 1,050.0 1,079.7 884.0 992.6 1,153.0 54 U.S. government securities 414.4 424.0 459.8 417.3 428.8 393.0 460.7 405.5 550.5 368.1 359.9 436.7 55 Tax-exempt securities 48.7 68.7 31.1 78.1 -15.1 130.3 66.2 27.4 22.6 -9.8 -41.2 -32.1 56 Corporate and foreign bonds 114.7 160.5 160.4 252.9 142.4 213.4 299.9 247.1 219.0 137.0 103.1 110.3 57 Mortgages 200.1 161.9 124.5 159.2 193.9 153.5 228.3 154.0 163.2 189.1 239.9 183.5 58 Consumer credit 16.0 -15.0 5.5 62.3 117.5 41.6 76.2 111.3 72.7 121.9 125.9 149.4 59 Bank loans n.e.c 2.2 -29.1 -9.4 -8.3 63.2 19.2 -7.3 4.2 61.9 23.3 79.5 88.1 60 Open market paper 30.7 -44.0 13.1 -5.1 35.7 16.4 6.3 67.7 -57.2 14.8 68.0 117.1 61 Other loans 35.6 -84.9 9.5 4.7 61.0 -8.7 4.9 32.9 47.0 39.4 57.6 100.0 Funds raised through mutual funds and corporate equities 62 Total net share issues 19.7 215.4 296.0 437.1 159.8 471.9 498.0 434.5 312.3 236.4 126.7 -36.0 63 Mutual funds 65.3 151.5 211.9 317.0 128.3 358.0 348.9 292.0 204.5 167.0 129.3 12.3 64 Corporate equities -45.6 64.0 84.1 120.1 31.6 113.9 149.1 142.4 107.8 69.4 -2.6 -48.3 65 Nonfinancial corporations -63.0 18.3 27.0 21.3 -40.9 23.2 32.3 21.5 -9.6 -2.0 -50.0 -102.0 66 Financial corporations 10.0 15.1 26.4 38.2 28.6 38.6 38.2 40.9 47.9 24.8 23.7 17.9 67 Foreign shares purchased in United States 7.4 30.7 30.7 60.6 43.9 52.1 78.6 80.0 69.4 46.7 23.7 35.7 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, tables F.2 through F.5. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 1.58 SUMMARY OF FINANCIAL TRANSACTIONS1 Billions of dollars except as noted; quarterly data at seasonally adjusted annual rates 1993 1994 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999900 11999911 11999922 11999933 11999944 Q2 Q3 Q4 Q1 Q2 Q3 Q4 NET LENDING IN CREDIT MARKETS2 1 Total net lending in credit markets 862-3 642.2 794.5 961.2 1,0273 958.8 1,135.3 1,050.0 1,079.7 884.0 992.6 1,153.0 2 Private domestic nonfinancial sectors 190.1 -7.5 72.0 4.8 296.5 -4.6 -39.5 86.3 391.3 340.1 152.0 302.5 3 Households 157.2 • -39.6 70.7 -11.5 378.3 -76.5 -69.7 174.7 394.3 408.3 246.6 464.1 4 Nonfarm noncorporate business -1.7 -3.7 -1.1 -3.2 -2.0 -3.2 -3.3 -3.5 -3.6 -1.8 -1.9 -.5 5 Nonfinancial corporate business -3.7 6.7 29.2 18.0 18.2 17.3 41.2 16.0 22.3 16.9 21.8 11.7 6 State and local governments 38.3 29.2 -26.8 1.5 -98.0 57.7 -7.7 -101.0 -21.6 -83.2 -114.4 -172.7 7 U.S. government 33.7 10.5 -11.9 -18.4 -19.6 -27.1 -15.4 -7.9 -40.8 -11.1 -.9 -25.7 8 Foreign 85.5 26.6 100.5 126.0 129.0 93.4 123.5 221.2 127.6 49.4 119.6 219.6 9 Financial sectors 553.0 612.5 633.9 848.8 621.4 897.1 1,066.6 750.4 601.6 505.5 721.9 656.6 10 Government sponsored enterprises 13.9 15.2 69.0 90.2 118.9 128.0 144.8 71.2 92.4 101.1 125.6 156.5 11 Federally related mortgage pools 150.3 136.6 115.6 80.6 95.7 -12.2 119.5 77.9 180.0 98.6 72.8 31.5 12 Monetary authority 8.1 31.1 27.9 36.2 31.5 35.7 28.2 38.5 48.8 17.9 24.0 35.4 13 Commercial banking 125.1 80.8 95.3 142.2 162.1 133.4 146.7 188.1 184.7 109.1 191.3 163.3 14 U.S. commercial banks 94.9 35.7 69.5 149.6 148.1 137.4 160.3 197.3 120.6 128.4 164.6 178.7 15 Foreign banking offices 28.4 48.5 16.5 -9.8 11.0 -14.3 -16.9 -6.5 59.0 -21.5 22.1 -15.7 16 Bank holding companies -2.8 -1.5 5.6 .0 1.1 7.9 1.2 -4.8 3.1 .2 2.7 -1.5 17 Banks in U.S. affiliated areas 4.5 -1.9 3.7 2.4 1.9 2.4 2.2 2.1 2.1 1.9 1.9 1.8 18 Funding corporations 16.1 15.8 23.5 18.1 12.6 1.1 32.4 42.6 17.8 35.3 21.4 -24.1 19 Thrift institutions -154.0 -123.5 -61.3 -1.7 35.6 16.1 21.0 -13.3 13.6 42.6 52.0 34.1 20 Life insurance companies 94.4 83.2 79.1 105.1 55.4 109.4 111.8 86.4 53.7 6.1 83.4 78.3 21 Other insurance companies 26.5 32.6 12.8 33.3 21.1 36.0 37.6 32.1 27.9 20.8 16.0 19.7 22 Private pension funds 17.2 85.7 37.3 40.2 -42.8 11.1 91.9 -60.1 -97.7 -30.7 -17.5 -25.5 23 State and local government retirement funds 34.9 46.0 34.4 25.5 43.8 47.5 27.4 36.9 30.3 51.2 41.5 52.1 24 Finance companies 29.0 -12.7 1.7 -9.0 66.8 -34.7 9.4 22.6 72.1 49.8 58.9 86.4 25 Mortgage companies .0 11.2 .1 .0 -26.0 65.1 -1.6 -13.3 -43.5 -36.3 -14.0 -10.0 26 Mutual funds 41.4 90.3 123.7 164.0 -14.0 194.4 174.6 138.4 18.0 11.3 -18.7 -66.5 27 Closed-end funds .2 14.7 17.4 10.2 3.5 10.5 5.9 7.7 8.3 3.2 1.4 1.0 28 Money market funds 80.9 30.1 1.3 14.7 30.5 33.3 25.3 57.3 -44.5 33.7 54.4 78.4 29 Real estate investment trusts (REITs) -.7 -.7 1.1 .6 .7 .8 1.0 .2 .7 .7 .7 .7 30 Brokers and dealers 2.8 17.5 -6.9 9.2 -32.0 52.5 -7.8 -82.8 -56.1 -52.6 -11.8 -7.6 31 Asset-backed securities issuers (ABSs) 51.1 48.9 53.8 80.1 51.8 59.4 88.6 111.1 86.0 38.7 37.4 45.1 32 Bank personal trusts 15.9 10.0 8.0 9.5 6.3 10.0 9.9 8.9 9.3 5.2 2.9 7.7 RELATION OF LIABILITIES TO FINANCIAL ASSETS 33 Net flows through credit markets 862.3 642.2 794.5 961.2 1,027.3 958.8 1,135.3 1,050.0 1,079.7 884.0 992.6 1,153.0 Other financial sources 34 Official foreign exchange 2.0 -5.9 -1.6 .8 -5.6 -4.0 1.7 2.2 -.2 -14.6 .2 -7.8 35 Special drawing rights certificates 1.5 .0 -2.0 .0 .0 .0 .0 .0 .0 .0 .0 .0 36 Treasury currency 1.0 .0 .2 .4 .7 .4 .4 .7 .7 .6 .8 .7 37 Life insurance reserves 25.7 25.7 27.3 35.2 20.1 35.3 36.6 35.5 20.0 8.1 23.8 28.7 38 Pension fund reserves 165.1 360.3 249.7 309.2 113.9 313.7 349.9 251.6 -8.8 64.3 214.4 185.6 39 Interbank claims 35.4 -3.9 61.7 44.7 85.0 128.9 -5.0 -13.7 150.9 184.9 -26.6 30.8 40 Checkable deposits and currency 43.3 86.4 113.8 117.3 -10.3 214.4 73.1 81.9 173.1 -66.1 -87.4 -60.6 41 Small time and savings deposits 63.7 1.5 -57.2 -70.3 -39.8 -67.8 -68.1 -36.6 2.5 -62.4 -56.4 -42.9 42 Large time deposits -66.1 -58.5 -73.2 -23.5 20.7 -26.8 -59.5 13.7 -39.6 -4.4 83.8 42.9 43 Money market fund shares 70.3 41.2 3.9 15.3 46.3 61.8 .6 45.7 -33.5 67.8 50.3 100.8 44 Security repurchase agreements -24.2 -16.5 35.5 65.5 79.1 37.9 67.8 -14.4 14.3 175.9 76.9 49.3 45 Foreign deposits 38.2 -16.7 -7.2 -11.0 13.1 -17.1 -50.7 35.7 16.4 14.6 -8.4 29.6 46 Mutual fund shares 65.3 151.5 211.9 317.0 128.3 358.0 348.9 292.0 204.5 167.0 129.3 12.3 47 Corporate equities -45.6 64.0 84.1 120.1 31.6 113.9 149.1 142.4 107.8 69.4 -2.6 -48.3 48 Security credit 3.5 51.4 4.2 61.9 -3.0 40.0 76.6 86.5 29.7 -17.5 -61.7 37.3 49 Trade debt 37.0 3.6 41.5 49.0 75.6 51.0 49.6 51.9 35.6 87.2 92.2 87.4 50 Taxes payable -4.8 -6.2 8.5 4.6 2.3 7.3 -1.8 4.9 14.2 -11.6 2.7 3.9 51 Noncorporate proprietors' equity -28.3 -3.3 18.4 -10.2 -44.8 -14.9 6.3 -25.6 -50.3 -44.6 -40.7 -43.8 52 Investment in bank personal trusts 29.7 16.1 -7.1 1.6 4.6 -7.2 .1 17.6 15.4 -15.5 6.7 11.9 53 Miscellaneous 135.7 197.2 257.6 289.7 260.0 402.1 221.4 342.0 359.6 272.3 289.2 118.9 54 Total financial sources 1,410.6 1,530.2 1,764.5 2,278.5 1,805.1 2,585.6 2,332.5 2,364.0 2,092.0 1,759.5 1,679.0 1,689.9 Floats not included in assets (—) 55 U.S. government checkable deposits 3.3 -13.1 .7 -1.5 -4.7 2.9 2.1 -15.5 -2.4 -1.4 15.2 -30.3 56 Other checkable deposits 8.5 4.5 1.6 -1.3 -2.8 8.3 -5.2 -6.2 .6 -1.1 -6.2 -4.3 57 Trade credit 9.1 9.7 4.1 16.5 -.9 25.7 22.2 12.5 -25.7 5.6 14.1 2.3 Liabilities not identified as assets (—) 58 Treasury currency .2 -.6 -.2 -.2 -.2 -.2 -.2 -.2 -.2 -.2 -.2 -.2 59 Interbank claims 1.6 26.2 -4.9 4.2 -2.7 .5 -10.4 24.0 -29.1 5.3 11.3 1.7 60 Security repurchase agreements -24.0 6.2 27.9 82.2 41.7 60.8 66.6 21.6 4.4 117.3 62.1 -17.1 61 Taxes payable .1 1.3 14.0 1.0 -1.1 18.2 1.2 -8.6 -.3 4.2 -4.6 -3.8 62 Miscellaneous -35.4 -45.3 -46.0 -41.9 -7.3 -98.0 -20.9 48.2 -66.0 -171.5 147.5 61.0 63 Total identified to sectors as assets 1,447.2 1,541.2 1,767.2 2,219.5 1,783.2 2,567.4 2,277.1 2,288.2 2,210.9 1,801.3 1,439.9 1,680.5 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, 2. Excludes corporate equities and mutual fund shares, tables F.6 and F.7. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A43 1.59 SUMMARY OF CREDIT MARKET DEBT OUTSTANDING1 Billions of dollars, end of period 1993 1994 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999911 11999944 Q2 Q3 Q4 Qi Q2 Q3 Q4 Nonfinancial sectors 1 Total credit market debt owed by domestic nonfinancial sectors 11,181.5 11,720.7 12,363.1 12,982.5 12,008.9 12,1553 12,363.1 12,487.0 12,633.0 12,780.4 12,982.5 By sector and instrument 2 U.S. government 2,776.4 3,080.3 3,336.5 3,492.3 3,201.2 3,247.3 3,336.5 3,387.7 3,395.4 3,432.6 3,492.3 3 Treasury securities 2,757.8 3,061.6 3,309.9 3,465.6 3,180.6 3,222.6 3,309.9 3,361.4 3,368.0 3,404.1 3,465.6 4 Budget agency issues and mortgages 18.6 18.8 26.6 26.7 20.6 24.7 26.6 26.3 27.4 28.5 26.7 5 Private 8,405.1 8,640.4 9,026.6 9,490.2 8,807.7 8,908.1 9,026.6 9,099.3 9,237.6 9,347.7 9,490.2 By instrument 6 Tax-exempt obligations 1,108.6 1,139.7 1,217.8 1,202.7 1,202.2 1,210.0 1,217.8 1,222.3 1,229.5 1,209.9 1,202.7 7 Corporate bonds 1,086.9 1,154.4 1,229.6 1,251.6 1,194.8 1,212.8 1,229.6 1,238.5 1,247.5 1,251.0 1,251.6 8 Mortgages 3,920.0 4,043.9 4,206.5 4,400.6 4,109.9 4,166.6 4,206.5 4,233.3 4,290.9 4,351.9 4,400.6 9 Home mortgages 2,780.0 2,959.6 3,147.3 3,339.2 3,038.1 3,098.3 3,147.3 3,181.1 3,234.7 3,291.9 3,339.2 10 Multifamily residential 304.8 293.6 287.5 289.2 289.4 288.2 287.5 286.3 287.8 289.1 289.2 11 Commercial 755.8 710.3 690.6 689.7 701.4 699.0 690.6 684.7 686.6 688.6 689.7 12 Farm 79.3 80.4 81.2 82.5 81.0 81.1 81.2 81.3 81.9 82.3 82.5 13 Consumer credit 797.4 803.0 866.5 984.0 800.2 824.3 866.5 863.6 895.3 931.8 984.0 14 Bank loans n.e.c 686.0 672.1 677.2 754.7 666.3 665.6 677.2 687.3 707.4 726.4 754.7 15 Commercial paper 98.5 107.1 117.8 139.2 124.0 123.2 117.8 129.9 135.7 138.7 139.2 16 Other loans 707.8 720.2 711.1 757.4 710.2 705.5 711.1 724.3 731.2 738.1 757.4 By borrowing sector 17 Household 3,784.7 4,002.3 4,292.0 4,641.3 4,093.0 4,190.9 4,292.0 4,331.7 4,425.0 4,527.1 4,641.3 18 Nonfinancial business 3,709.3 3,710.5 3,741.5 3,885.0 3,729.8 3,729.1 3,741.5 3,774.0 3,816.3 3,845.8 3,885.0 19 Farm 135.0 136.0 138.3 140.6 136.7 138.7 138.3 136.6 141.3 142.8 140.6 20 Nonfarm noncorporate 1,116.4 1,074.1 1,049.1 1,068.8 1,059.4 1,052.2 1,049.1 1,050.4 1,055.6 1,062.2 1,068.8 21 Corporate 2,458.0 2,500.4 2,554.1 2,675.6 2,533.7 2,538.3 2,554.1 2,586.9 2,619.3 2,640.9 2,675.6 22 State and local government 911.1 927.5 993.2 963.9 984.9 988.0 993.2 993.6 996.3 974.8 963.9 23 Foreign credit market debt held in United States 298.8 310.9 357.8 345.8 332.0 3513 357.8 3403 339.2 338.8 345.8 7.4 Bonds 129.5 143.9 203.4 220.4 171.9 193.0 203.4 210.6 212.9 214.2 220.4 25 Bank loans n.e.c 21.6 23.9 24.6 26.1 25.9 26.2 24.6 26.2 25.1 26.3 26.1 26 Commercial paper 81.8 77.7 68.7 41.4 72.1 71.7 68.7 43.3 42.0 39.9 41.4 27 U.S. government and other loans 65.9 65.3 61.1 57.8 62.0 60.3 61.1 60.3 59.2 58.4 57.8 28 Total credit market debt owed by nonfinancial sectors, domestic and foreign 11,480.3 12,031.6 12,720.8 13,328.3 12,340.9 12,506.6 12,720.8 12,8273 12,972.2 13,119.2 13,3283 Financial sectors 29 Total credit market debt owed by finandal sectors 2,752.1 3,004.7 3,297.3 3,722.4 3,096.6 3,204.7 3,297.3 3,4153 3,507.6 3,597.7 3,722.4 By instrument 30 U.S. government-related 1,564.2 1,720.0 1,881.1 2,149.3 1,774.5 1,845.2 1,881.1 1,954.5 2,021.1 2,075.9 2,149.3 31 Government-sponsored enterprises securities 402.9 443.1 523.7 700.9 468.4 510.3 523.7 563.7 600.3 638.3 700.9 32 Mortgage pool securities 1,156.5 1,272.0 1,352.6 1,448.4 1,301.3 1,330.1 1,352.6 1,390.8 1,420.8 1,437.6 1,448.4 33 Loans from U.S. government 4.8 4.8 4.8 .0 4.8 4.8 4.8 .0 .0 .0 .0 34 Private 1,187.9 1,284.8 1,416.1 1,573.2 1,322.2 1,359.5 1,416.1 1,460.9 1,486.6 1,521.8 1,573.2 35 CCoorrppoorraattee bboonnddss 640.0 724.8 844.1 944.9 774.8 810.5 844.1 880.8 904.5 925.4 944.9 36 MMoorrttggaaggeess 4.8 5.4 8.9 8.8 6.0 7.6 8.9 9.0 9.1 9.2 8.8 37 Bank loans n.e.c 78.4 80.5 66.5 50.7 73.3 69.2 66.5 61.8 54.1 50.5 50.7 38 Open market paper 385.7 394.3 393.5 442.8 375.9 373.2 393.5 408.8 410.3 420.5 442.8 39 Loans from Federal Home Loan Banks 79.1 79.9 103.1 125.9 92.1 98.9 103.1 100.4 108.5 116.2 125.9 By borrowing sector 40 Government-sponsored enterpnses 407.7 447.9 528.5 700.9 473.2 515.1 528.5 563.7 600.3 638.3 700.9 41 Federally related mortgage pools 1,156.5 1,272.0 1,352.6 1,448.4 1,301.3 1,330.1 1,352.6 1,390.8 1,420.8 1,437.6 1,448.4 42 Private financial sectors 1,187.9 1,284.8 1,416.1 1,573.2 1,322.2 1,359.5 1,416.1 1,460.9 1,486.6 1,521.8 1,573.2 43 Commercial banks 65.0 73.8 79.5 89.5 76.6 77.9 79.5 78.4 82.1 87.5 89.5 44 Bank holding companies 112.3 114.6 123.4 131.8 120.2 120.3 123.4 124.2 126.8 129.6 131.8 45 Funding corporations 139.1 161.6 169.9 200.9 166.5 166.3 169.9 190.6 191.1 200.1 200.9 46 Savings institutions 94.6 87.8 99.0 111.7 93.4 96.8 99.0 97.6 99.0 102.7 111.7 47 Credit unions .0 .0 .2 .5 .1 .2 .2 .3 .3 .4 .5 48 Life insurance companies .0 .0 .2 .6 .2 .1 .2 .3 .3 .3 .6 49 Finance companies 393.0 389.4 390.5 440.8 373.8 380.0 390.5 401.9 414.2 420.9 440.8 50 Mortgage companies 22.2 30.2 29.2 16.3 32.0 31.8 29.2 23.8 19.3 17.5 16.3 51 Real estate investment trusts (REITs) 13.6 13.9 17.4 19.1 14.4 15.8 17.4 17.7 18.3 18.8 19.1 52 Issuers of asset-backed securities (ABSs) 329.1 391.7 473.2 527.8 422.3 443.8 473.2 494.9 504.0 514.5 527.8 All sectors 53 Total credit market debt, domestic and foreign.... 14,232.3 15,0363 16,018.1 17,050.7 15,437.5 15,7113 16,018.1 16,242.6 16,479.8 16,716.9 17,050.7 54 U.S. government securities 4,335.7 4,795.5 5,212.8 5,641.6 4,970.9 5,087.7 5,212.8 5,342.2 5,416.5 5,508.6 5,641.6 55 Tax-exempt securities 1,108.6 1,139.7 1,217.8 1,202.7 1,202.2 1,210.0 1,217.8 1,222.3 1,229.5 1,209.9 1,202.7 56 CCooiippoorraattee aanndd ffoorreeiiggnn bboonnddss 1,856.5 2,023.1 2,277.0 2,416.9 2,141.5 2,216.3 2,277.0 2,329.9 2,364.9 2,390.5 2,416.9 57 MMoorrttggaaggeess 3,924.8 4,049.3 4,215.5 4,409.4 4,116.0 4,174.2 4,215.5 4,242.4 4,300.1 4,361.1 4,409.4 58 Consumer credit 797.4 803.0 866.5 984.0 800.2 824.3 866.5 863.6 895.3 931.8 984.0 59 Bank loans n.e.c 785.9 776.6 768.4 831.6 765.5 761.0 768.4 775.4 786.6 803.2 831.6 60 Open market paper 565.9 579.0 580.0 623.5 572.0 568.2 580.0 582.0 587.9 599.2 623.5 61 Other loans 857.5 870.2 880.1 941.1 869.1 869.6 880.1 884.9 898.9 912.7 941.1 Digitized for FRASER 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, http://fraser.statbloleus Lis.2f ethdro.uogrhg L/ .4. For ordering address, see inside front cover. Federal Reserve Bank of St. Louis

A44 Domestic Financial Statistics • June 1995 1.60 SUMMARY OF FINANCIAL ASSETS AND LIABILITIES1 Billions of dollars except as noted, end of period 1993 1994 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999911 11999922 11999933 11999944 Q2 Q3 Q4 Ql Q2 Q3 Q4 CREDIT MARKET DEBT OUTSTANDING2 1 Total credit market assets 14,232.3 15,0363 16,018.1 17,050.7 15,437.5 15,711.3 16,018.1 16,242.6 16,479.8 16,716.9 17,050.7 2 Private domestic nonfinancial sectors 2,240.2 2,318.0 2,338.9 2,663.4 2,296.1 2,284.8 2,338.9 2,432.9 2,513.8 2,551.1 2,663.4 3 Households 1,446.5 1,523.1 1,525.9 1,932.3 1,473.3 1,459.6 1,525.9 1,631.1 1,723.4 1,789.3 1,932.3 4 Nonfarm noncorporate business 44.1 42.9 39.7 37.7 41.4 40.6 39.7 38.8 38.4 37.9 37.7 5 Nonfinancial corporate business 196.2 225.4 248.1 266.2 227.3 234.7 248.1 243.8 250.9 253.9 266.2 6 State and local governments 553.3 526.5 525.2 427.2 554.2 549.9 525.2 519.2 501.1 470.0 427.2 7 U.S. government 246.9 235.0 216.6 197.0 223.1 218.8 216.6 206.3 204.0 203.3 197.0 8 Foreign 958.1 1,052.7 1,175.1 1,304.1 1,084.0 1,118.1 1,175.1 1,206.8 1,218.5 1,251.3 1,304.1 9 Financial sectors 10,787.2 11,430.6 12,287.5 12,886.2 11,834.2 12,089.6 12,287.5 12,396.5 12,543.5 12,711.1 12,886.2 10 Government-sponsored enterprises 390.7 459.7 549.8 668.7 495.5 531.8 549.8 572.0 597.9 629.4 668.7 11 Federally related mortgage pools 1,156.5 1,272.0 1,352.6 1,448.4 1,301.3 1,330.1 1,352.6 1,390.8 1,420.8 1,437.6 1,448.4 12 Monetary authority 272.5 300.4 336.7 368.2 318.2 324.2 336.7 341.5 351.6 356.8 368.2 13 Commercial banking 2,853.3 2,948.6 3,090.8 3,252.9 2,998.8 3,036.4 3,090.8 3,120.2 3,156.2 3,204.2 3,252.9 14 U.S. commercial banks 2,502.5 2,571.9 2,721.5 2,869.6 2,628.5 2,670.2 2,721.5 2,743.8 2,780.3 2,822.4 2,869.6 15 Foreign banking offices 319.2 335.8 326.0 337.0 327.1 322.3 326.0 331.8 330.8 335.5 337.0 16 Bank holding companies 11.9 17.5 17.5 18.6 18.4 18.7 17.5 18.2 18.3 19.0 18.6 17 Banks in U.S. affiliated areas 19.7 23.4 25.8 27.8 24.8 25.3 25.8 26.4 26.8 27.3 27.8 18 Funding corporations 51.5 75.0 93.1 105.6 74.3 82.4 93.1 97.5 106.3 111.7 105.6 19 Thrift institutions 1,192.6 1,134.5 1,132.7 1,168.3 1,130.0 1,136.5 1,132.7 1,134.2 1,146.1 1,160.1 1,168.3 20 Life insurance companies 1,199.6 1,278.8 1,383.9 1,439.3 1,343.9 1,372.1 1,383.9 1,404.2 1,409.1 1,430.3 1,439.3 21 Other insurance companies 376.6 389.4 422.7 443.8 405.3 414.6 422.7 429.6 434.8 438.8 443.8 22 Private pension funds 693.0 730.4 770.6 727.7 762.6 785.6 770.6 746.2 738.5 734.1 727.7 23 State and local government retirement funds 479.9 514.3 542.6 586.4 526.5 533.4 542.6 550.2 563.0 573.3 586.4 24 Finance companies 484.9 486.6 482.8 549.6 473.7 474.0 482.8 494.5 511.3 524.1 549.6 25 Mortgage companies 60.3 60.5 60.4 34.5 64.1 63.8 60.4 49.5 40.4 37.0 34.5 26 Mutual funds 450.5 574.2 738.2 701.6 659.9 703.6 738.2 720.1 722.9 718.2 701.6 27 Closed-end funds 50.3 67.7 77.9 81.4 74.5 76.0 77.9 80.0 80.8 81.1 81.4 28 Money market funds 402.7 404.1 418.8 449.2 403.9 400.6 418.8 422.2 422.0 425.1 449.2 29 Real estate investment trusts (REITs) 7.0 8.1 8.6 9.3 8.3 8.6 8.6 8.8 9.0 9.1 9.3 30 Brokers and dealers 124.0 117.1 126.3 94.3 149.0 147.1 126.3 112.3 99.2 96.2 94.3 31 Asset-backed securities issuers (ABSs) 317.8 377.9 458.0 509.8 408.1 430.2 458.0 479.5 489.2 498.5 509.8 32 Bank personal trusts 223.5 231.5 240.9 247.2 236.2 238.7 240.9 243.3 244.6 245.3 247.2 RELATION OF LIABILITIES TO FINANCIAL ASSETS 33 Total credit market debt 14,232.3 15,0363 16,018.1 17,050.7 15,437.5 15,711.3 16,018.1 16,242.6 16,479.8 16,716.9 17,050.7 Other liabilities 34 Official foreign exchange 55.4 51.8 53.4 53.2 53.9 55.6 53.4 56.4 54.9 55.5 53.2 35 Special drawing rights certificates 10.0 8.0 8.0 8.0 8.0 8.0 8.0 8.0 8.0 8.0 8.0 36 Treasury currency 16.3 16.5 17.0 17.6 16.7 16.8 17.0 17.1 17.3 17.5 17.6 37 Life insurance reserves 405.7 433.0 468.2 488.4 450.2 459.4 468.2 473.2 475.2 481.2 488.4 38 Pension fund reserves 4,138.3 4,516.5 4,974.7 5,061.2 4,730.8 4,887.8 4,974.7 4,923.0 4,915.8 5,045.5 5,061.2 39 Interbank claims 96.4 132.8 177.7 263.8 145.2 166.9 177.7 204.2 223.8 243.4 263.8 40 Deposits at financial institutions 5,044.8 5,059.1 5,152.4 5,261.5 5,097.1 5,088.5 5,152.4 5,158.9 5,180.5 5,198.2 5,261.5 41 Checkable deposits and currency 1,020.6 1,134.4 1,251.7 1,241.4 1,168.0 1,181.9 1,251.7 1,220.5 1,229.7 1,205.4 1,241.4 42 Small time and savings deposits 2,350.7 2,293.5 2,223.2 2,183.4 2,255.0 2,236.6 2,223.2 2,233.8 2,214.1 2,198.9 2,183.4 43 Large time deposits 488.4 415.2 391.7 412.4 401.1 389.4 391.7 382.6 379.0 402.9 412.4 44 Money market fund shares 539.6 543.6 558.9 605.3 549.8 547.9 558.9 576.2 570.3 579.9 605.3 45 Security repurchase agreements 355.8 392.3 457.8 536.9 450.4 472.5 457.8 472.7 510.6 536.4 536.9 46 Foreign deposits 289.6 280.1 269.1 282.1 272.8 260.2 269.1 273.2 276.8 274.7 282.1 47 Mutual fund shares 813.9 1,042.1 1,429.3 1,463.0 1,225.8 1,342.4 1,429.3 1,438.7 1,443.6 1,505.7 1,463.0 48 Security credit 188.9 217.3 279.3 276.2 234.7 254.5 279.3 282.7 278.0 263.3 276.2 49 Trade debt 935.9 977.4 1,026.4 1,102.0 989.7 1,009.6 1,026.4 1,023.6 1,045.7 1,076.6 1,102.0 50 Taxes payable 71.2 79.6 84.2 86.5 81.2 82.8 84.2 89.0 82.4 85.4 86.5 51 Investment in bank personal trusts 608.3 629.6 660.9 655.6 637.6 651.2 660.9 655.3 640.2 656.8 655.6 52 Miscellaneous 2,992.2 3,160.2 3,402.3 3,687.8 3,248.3 3,314.6 3,402.3 3,510.9 3,571.1 3,662.8 3,687.8 53 Total liabilities 29,609.6 31360.1 33,751.8 35,475.6 32,356.5 33,049.4 33,751.8 34,083.7 34,416.5 35,016.8 35,475.6 Financial assets not included in liabilities (+) 54 Gold and special drawing rights 22.3 19.6 20.1 21.1 20.0 20.3 20.1 20.4 20.8 21.0 21.1 55 Corporate equities 4,863.6 5,462.9 6,186.5 6,048.8 5,683.7 5,941.7 6,186.5 6,052.2 5,877.7 6,135.1 6,048.8 56 Household equity in noncorporate business 2,444.4 2,411.5 2,421.7 2,485.0 2,407.1 2,420.3 2,421.7 2,460.2 2,473.6 2,482.9 2,485.0 Floats not included in assets (-) 57 U.S. government checkable deposits 3.8 6.8 5.6 3.4 3.5 2.2 5.6 .3 .9 1.2 3.4 58 Other checkable deposits 40.4 42.0 40.7 38.0 41.6 33.7 40.7 36.3 38.7 30.6 38.0 59 Trade credit -129.3 -124.6 -101.7 -102.3 -135.0 -130.4 -101.7 -121.2 -130.7 -127.2 -102.3 Liabilities not identified as assets (—) 60 Treasury currency -4.8 -4.9 -5.1 -5.4 -5.0 -5.1 -5.1 -5.2 -5.2 -5.3 -5.4 61 Interbank claims -4.2 -9.3 -4.7 -6.5 -5.7 -7.8 -4.7 -7.7 -7.4 -3.5 -6.5 62 Security repurchase agreements 9.2 38.1 120.2 162.3 108.0 132.6 120.2 133.4 160.0 186.1 162.3 63 Taxes payable 17.8 25.2 26.2 25.1 24.3 24.3 26.2 15.3 21.7 21.0 25.1 64 Miscellaneous -330.7 -398.4 -477.2 -519.4 -436.1 -480.5 -477.2 -491.2 -461.4 -481.2 -519.4 65 Total identified to sectors as assets 37,337.6 39,679.1 42,776.1 44,435.1 40,871.8 41,862.8 42,776.1 43,056.7 43,171.9 44,034.1 44,435.1 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, 2. Excludes corporate equities and mutual fund shares, tables L.6 and L.7. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A45 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures Monthly data seasonally adjusted, and indexes 1987 = 100, except as noted 1994 1995 MMeeaassuurree 11999922 11999933 11999944 July Aug. Sept. Oct. Nov. Dec. Jan.r Feb.r Mar. 1 Industrial production1 107.6 112.0 118.1 118.2 119.1 119.0 119.5 120.3 121.7 122.2 122.3 121.9 Market groupings ? Products, total 106.5 110.7 115.9 116.2 116.7 116.4 116.9 117.5 118.7 111199..33 111199..33 111188..88 3 Final, total 109.0 113.4 118.4 118.5 119.2 118.9 119.2 119.8 121.2 121.9 122.0 121.4 4 Consumer goods 105.9 109.4 113.2 113.3 113.8 113.0 113.0 113.9 115.5r 116.1 116.1 115.2 S 113.4 119.3 126.5 126.4 127.5 128.0 128.8 128.9 130. r 130.8 131.0 131.1 6 98.8 102.4 108.lr 109.1 109.2 108.6 109.9 110.6 110.9r 111.2 111.1 110.9 7 Materials 109.2 114.1 121.5 121.4 122.8 122.9 123.4 124.6 126.3 126.6 126.9 126.7 Industry groupings 8 Manufacturing 108.0 112.9 119.7 119.8 120.9 120.9 112211..55 122.6 112244..22rr 112244..77 112244..55 112244..44 9 Capacity utilization, manufacturing (percent)2.. 79.2 80.9 83.4 83.3 83.8 83.6 83.8 84.4 85.2 85.3 84.9 84.5 10 Construction contracts3 97.7 104.4 108.3r 109.0 110.0 109.0 107.0 111.0 101.0 104.0 111.0 108.0 11 Nonagricultural employment, total4 106.5 108.4 111.3 111.4 111.7 112.0 112.2 112.7 112.9 113.1 113.4 113.6 1? Goods-producing, total 94.2 94.3 95.6 95.6 95.8 95.9 96.1 96.6 96.8 97.1 97.0 97.2 13 Manufacturing, total 95.3 94.8 95.1 95.0 95.2 95.3 95.5 95.7 95.9 96.2 96.3 96.2 14 Manufacturing, production workers 94.9 94.9 96.1 96.0 96.3 96.4 96.7 97.1 97.3 97.6 97.8 97.8 15 Service-producing 110.5 112.9 116.3 116.5 116.8 117.1 117.3 117.8 118.1 118.2 118.6 118.8 16 Personal income, total 135.6 141.4 150.0 150.0 150.7 151.7 153.7 153.7 154.7r 155.9 156.7 n.a. 17 Wages and salary disbursements 131.6 136.2 145.0 145.2 145.5 146.4 148.2 148.1 149.0 150.1 150.6 n.a. 18 Manufacturing 118.0 120.0 126.0 125.6 126.2 126.7 128.8 127.9 128.6r 129.1 131.3 n.a. 19 Disposable personal income5 137.0 142.5 150.8 150.9 151.6 152.6 154.8 154.7 155.8r 156.8 157.6 n.a. 20 Retail sales5 126.4 134.7 145.2 144.4 146.5 147.6 149.3 149.8 150.0 150.7 149.2 149.5 Prices6 Consumer (1982 84=100) 140.3 144.5 148.2 148.4 149.0 149.4 149.5 149.7 149.7 115500..33 115500..99 115511..44 22 Producer finished goods (1982=100) 123.2 124.7 125.5 126.0 126.5 125.6 125.8 126.1 126.2 126.5 126.9 126.9 1. Data in this table also appear in the Board's G.17 (419) monthly statistical release. covers employees only, excluding personnel in the armed forces. For the ordering address, see the inside front cover. The latest historical revision of the 5. Based on data from U.S. Department of Commerce, Survey of Current Business. industrial production index and the capacity utilization rates was released in November 6. Based on data not seasonally adjusted. Seasonally adjusted data for changes in the 1994. See "Industrial Production and Capacity Utilization: A Revision," Federal Reserve price indexes can be obtained from the U.S. Department of Labor, Bureau of Labor Bulletin, vol. 81 (January 1995), pp. 16-26. For a detailed description of the industrial Statistics, Monthly Labor Review. production index, see "Industrial Production: 1989 Developments and Historical Revi- NOTE. Basic data (not indexes) for series mentioned in notes 4 and 5, and indexes for sion," Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204. series mentioned in notes 3 and 6, can also be found in the Survey of Current Business. 2. Ratio of index of production to index of capacity. Based on data from the Federal Figures for industrial production for the latest month are preliminary, and many figures Reserve, DRI McGraw-Hill, U.S. Department of Commerce, and other sources. for the three months preceding the latest month have been revised. See "Recent Develop- 3. Index of dollar value of total construction contracts, including residential, nonresi- ments in Industrial Capacity and Utilization," Federal Reserve Bulletin, vol. 76 (June dential, and heavy engineering, from McGraw-Hill Information Systems Company, F.W. 1990), pp. 411-35. See also "Industrial Production Capacity and Capacity Utilization Dodge Division. since 1987," Federal Reserve Bulletin, vol. 79 (June 1993), pp. 590-605. 4. Based on data from U.S. Department of Labor, Employment and Earnings. Series 2.11 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data seasonally adjusted except as noted 1994 1995 CCaatteeggoorryy 11999922 11999933 11999944 Aug. Sept. Oct. Nov. Dec. Jan.r Feb.r Mar. HOUSEHOLD SURVEY DATA1 1 Civilian labor force2 126,982 128,040 131,056 131,086 131,291 131,646 131,718 131,725 132,136 132,308 132,511 Employment 114,391 116,232 119,651 119,761 120,233 120,647 120,903 121,038 121,064 121,469 121,576 3 Agriculture 3,207 3,074 3,409 3,436 3,411 3,494 3,500 3,532 3,575 3,656 3,698 Unemployment 9,384 8,734 7,996 7,889 7,647 7,505 7,315 7,155 7,498 7,183 7,237 5 Rate (percent of civilian labor force) 7.4 6.8 6.1 6.0 5.8 5.7 5.6 5.4 5.7 5.4 5.5 ESTABLISHMENT SURVEY DATA 6 Nonagricultural payroll employment4 108,604 110,525 113,423 113,914 114,186 114,348 114,882 115,113 115,282 115,627 115,830 18,104 18,003 18,064 18,095 18,096 18,142 18,183 18,226 18,271 18,289 18,285 635 611 604 603 605 599 600 597 595 592 592 9 Contract construction 4,492 4,642 4,916 4,942 4,972 4,974 5,044 5,050 5,092 5,057 5,115 10 Transportation and public utilities 5,721 5,787 5,842 5,866 5,865 5,867 5,888 5,911 5,913 5,930 5,941 11 Trade 25,354 25,675 26,362 26,484 26,565 26,629 26,772 26,887 26,939 27,035 27,033 6,602 6,712 6,789 6,801 6,794 6,786 6,791 6,785 6,779 6,778 6,795 29,052 30,278 31,805 32,036 32,138 32,231 32,414 32,506 32,564 32,781 32,914 14 Government 18,653 18,817 19,041 19,087 19,151 19,120 19,190 19,151 19,129 19,165 19,155 1. Beginning January 1994, reflects redesign of current population survey and popula- 4. Includes all full- and part-time employees who worked during, or received pay for, tion controls from the 1990 census. the pay period that includes the twelfth day of the month; excludes proprietors, self- 2. Persons sixteen years of age and older, including Resident Armed Forces. Monthly employed persons, household and unpaid family workers, and members of the armed figures are based on sample data collected during the calendar week that contains the forces. Data are adjusted to the March 1992 benchmark, and only seasonally adjusted data twelfth day; annual data are averages of monthly figures. By definition, seasonality does are available at this time. not exist in population figures. SOURCE. Based on data from U.S. Department of Labor, Employment and Earnings. 3. Includes self-employed, unpaid family, and domestic service workers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 2.12 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION1 Seasonally adjusted 1994 1995 1994 1995 1994 1995 SSeerriieess Q2 Q3 Q4 QL Q2 Q3 Q4 QL Q2 Q3 Q4 QL Output (1987 = 100) Capacity (percent of 1987 output) Capacity utilization rate (percent)2 1 Total industry 117.4 118.8 120.5 122.1 140.0 140.9 141.9 143.1 83.8 84.3 84.9 85.3 2 Manufacturing 118.9 120.5 122.7 124.5 143.1 144.2 145.3 146.6 83.1 83.6 84.5 84.9 3 Primary processing3 114.7 115.9 118.4 119.7 131.0 131.6 132.3 133.2 87.6 88.1 89.5 89.9 4 Advanced processing4 120.9 122.7 124.8 126.8 148.7 150.0 151.3 152.9 81.3 81.8 82.5 83.0 5 Durable goods 124.1 126.5 129.4 131.7 150.2 151.6 153.1 154.9 82.6 83.4 84.6 85.0 6 Lumber and products 105.4 106.6 107.9 109.4 115.5 116.0 116.5 117.1 91.2 91.9 92.7 93.4 7 Primary metals 114.4 114.1 119.4 120.2 125.0 125.2 125.4 126.7 91.6 91.1 95.2 94.9 8 Iron and steel 120.2 115.8 123.3 125.0 127.9 128.4 128.8 130.9 93.9 90.2 95.8 95.5 9 Nonfenous 106.9 111.4 113.9 113.8 120.5 120.5 120.5 120.9 88.7 92.4 94.5 94.2 10 Industrial machinery and equipment 157.6 162.6 167.5 171.6 179.0 181.6 184.1 187.8 88.0 89.6 91.0 91.4 11 Electrical machinery 156.8 163.5 169.4 173.7 179.9 184.1 188.5 193.8 87.1 88.8 89.9 89.6 12 Motor vehicles and parts 133.3 135.0 141.5 146.3 158.5 160.3 162.2 164.2 84.1 84.2 87.2 89.1 13 Aerospace and miscellaneous transportation equipment ... 84.2 82.1 80.8 80.4 129.8 129.4 129.1 128.8 64.9 63.5 62.6 62.5 14 Nondurable goods 113.1 113.8 115.3 116.6 134.8 135.5 136.3 137.1 83.9 84.0 84.6 85.0 15 Textile mill products 108.7 108.9 111.6 112.2 120.8 121.4 122.0 122.7 90.1 89.7 91.4 91.4 16 Paper and products 115.9 118.5 120.6 120.0 126.6 127.1 127.7 128.4 91.6 93.2 94.4 93.4 17 Chemicals and products 123.6 124.4 126.0 129.4 151.9 153.3 154.7 156.2 81.4 81.1 81.4 82.9 18 Plastics materials 124.3 126.9 130.2 130.0 130.8 131.6 95.6 97.0 98.9 19 Petroleum products 106.3 104.9 106.5 108.3 115.3 115.2 115.1 115.1 92.2 91.1 92.5 94.1 20 Mining 100.7 100.1 99.2 100.0 111.5 111.5 111.4 111.4 90.3 89.8 89.0 89.7 21 Utilities 117.2 118.1 116.3 117.0 135.0 135.4 135.8 136.3 86.8 87.2 85.6 85.8 22 Electric 118.0 118.2 117.3 118.2 132.6 133.1 133.6 134.1 89.0 88.8 87.8 88.1 1973 1975 Previous cycle5 Latest cycle6 1994 1994 1995 High Low High Low High Low Mar. Oct. Nov. Dec/ Jan/ Feb/ Mar.P 2 Capacity utilization rate (percent] 1 Total industry 89.2 72.6 87.3 71.8 84.9 78.0 83.7 84.4 84.8 85.5 85.6 85.4 84.9 2 Manufacturing 88.9 70.8 87.3 70.0 85.2 76.6 82.9 83.8 84.4 85.2 85.3 84.9 84.5 3 Primary processing3 92.2 68.9 89.7 66.8 89.0 77.9 86.8 88.3 89.5 90.8 90.3 89.7 89.5 4 Advanced processing4 87.5 72.0 86.3 71.4 83.5 76.2 81.3 82.1 82.4 83.0 83.3 83.0 82.6 5 Durable goods 88.8 68.5 86.9 65.0 84.0 73.7 82.3 83.9 84.3 85.4 85.4 85.0 84.5 6 Lumber and products 90.1 62.2 87.6 60.9 93.3 76.3 90.3 91.7 91.6 94.7 94.3 93.2 92.8 7 Primary metals 100.6 66.2 102.4 46.8 92.8 74.0 89.8 92.5 95.0 98.0 96.0 94.5 94.1 8 Iron and steel 105.8 66.6 110.4 38.3 95.7 72.1 91.4 92.4 94.6 100.3 96.5 94.9 95.1 9 Nonferrous 92.9 61.3 90.5 62.2 88.7 75.0 87.9 92.7 95.6 95.2 95.5 94.1 92.9 10 Industrial machinery and equipment 96.4 74.5 92.1 64.9 84.0 72.5 86.9 90.9 91.0 91.1 92.0 91.3 90.9 11 Electrical machinery 87.8 63.8 89.4 71.1 84.9 76.6 86.1 89.3 89.6 90.8 90.3 89.7 89.0 12 Motor vehicles and parts 93.4 51.1 93.0 44.5 85.1 57.6 88.2 85.7 87.2 88.8 89.4 89.8 88.1 13 Aerospace and miscellaneous transportation equipment 77.0 66.6 81.1 66.9 88.4 79.4 64.4 62.6 62.6 62.5 62.3 62.5 62.6 14 Nondurable goods 87.9 71.8 87.0 76.9 86.7 80.4 83.8 83.9 84.6 85.2 85.4 85.0 84.7 15 Textile mill products 92.0 60.4 91.7 73.8 92.1 78.9 89.7 90.8 91.7 91.8 92.7 90.8 90.8 16 Paper and products 96.9 69.0 94.2 82.0 94.8 86.5 91.7 93.2 95.0 95.2 93.5 93.5 93.3 17 Chemicals and products 87.9 69.9 85.1 70.1 85.9 78.9 81.6 80.2 81.6 82.5 83.4 82.7 82.5 18 Plastics materials 102.0 50.6 90.9 63.4 97.0 74.8 94.3 93.3 98.5 105.0 105.6 19 Petroleum products 96.7 81.1 89.5 68.2 88.5 83.7 89.6 90.4 93.5 93.7 93.4 93.4 95.6 20 Mining 94.4 88.4 96.6 80.6 86.5 86.0 90.2 89.0 88.2 89.8 89.6 90.0 89.5 21 Utilities 95.6 82.5 88.3 76.2 92.6 83.2 87.5 86.4 85.8 84.7 85.3 87.3 85.0 22 Electric 99.0 82.7 88.3 78.7 94.8 86.5 88.6 88.3 88.0 87.1 87.5 89.7 87.1 1. Data in this table also appear in the Board's G.17 (419) monthly statistical release. 3. Primary processing includes textiles; lumber; paper; industrial chemicals; synthetic For the ordering address, see the inside front cover. The latest historical revision of the materials; fertilizer materials; petroleum products; rubber and plastics; stone, clay, and industrial production index and the capacity utilization rates was released in November glass; primary metals; and fabricated metals. 1994. See "Industrial Production and Capacity Utilization: A Revision," Federal Reserve 4. Advanced processing includes foods; tobacco; apparel; furniture and fixtures; print- Bulletin, vol. 81 (January 1995), pp. 16-26. For a detailed description of the industrial ing and publishing; chemical products such as drugs and toiletries; agricultural chemicals; production index, see "Industrial Production: 1989 Developments and Historical Revi- leather and products; machinery; transportation equipment; instruments; and miscellasion," Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204. neous manufactures. 2. Capacity utilization is calculated as the ratio of the Federal Reserve's seasonally 5. Monthly highs, 1978-80; monthly lows, 1982. adjusted index of industrial production to the corresponding index of capacity. 6. Monthly highs, 1988-89; monthly lows, 1990-91. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A47 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value1 Monthly data seasonally adjusted 1992 1994 1995 1994 GGrroouupp por- aavvgg.. tion Mar. Apr. May June July Aug. Sept. Oct. Nov/ Dec/ Jan/ Feb/ Mar.p Index (1987 = 100) MAJOR MARKETS 1 Total index 100.0 118.1 116.6 116.7 117.4 118.0 118.2 119.1 119.0 119.5 120.3 121.7 122.2 1223 121.9 ? Products 60.9 115.9 114.7 114.7 115.3 115.9 116.2 116.7 116.4 116.9 117.5 118.7 119.3 119.3 118.8 Final products 46.6 118.4 117.4 117.3 117.8 118.4 118.5 119.2 118.9 119.2 119.8 121.2 121.9 122.0 121.4 4 Consumer goods, total 28.5 113.2 112.9 112.3 112.8 113.5 113.3 113.8 113.0 113.0 113.9 115.5 116.1 116.1 115.2 Durable consumer goods 5.5 119.4 119.0 117.8 116.4 118.0 118.0 120.7 119.1 119.4 120.5 123.4 124.2 123.7 121.3 6 Automotive products 2.5 125.5 126.4 124.1 120.1 121.0 119.5 124.9 123.8 124.5 127.1 131.1 131.6 133.2 130.7 7 Autos and trucks 1.6 125.4 127.7 125.0 118.1 118.5 115.0 126.0 122.5 122.3 126.5 131.4 132.7 134.8 131.4 8 Autos, consumer .9 94.9 98.8 96.0 90.4 89.6 86.5 91.7 90.2 92.9 94.0 100.5 103.6 103.6 103.1 9 Trucks, consumer .7 180.7 179.6 177.2 168.0 170.7 166.6 189.0 181.5 175.5 185.8 187.3 184.6 191.0 181.7 10 Auto parts and allied goods .9 123.2 121.1 119.8 121.9 123.8 126.6 120.0 123.9 126.6 125.7 127.8 126.5 127.1 126.7 11 Other 3.0 114.1 112.7 112.5 113.2 115.4 116.7 117.1 115.2 115.2 115.0 116.8 117.9 115.6 113.3 17, Appliances televisions and air conditioners .7 126.0 124.3 120.7 125.6 132.8 129.7 135.1 130.2 124.9 126.9 131.5 130.4 124.7 120.1 N Carpeting and furniture .8 105.0 103.1 104.5 103.3 103.6 108.4 106.9 104.1 107.4 105.9 108.0 110.2 107.9 106.3 14 Miscellaneous home goods 1.5 113.8 112.8 113.2 113.1 114.2 115.3 114.6 114.6 114.9 114.5 114.9 116.4 115.6 113.9 IS Nondurable consumer goods 23.0 111.8 111.5 111.0 112.0 112.5 112.2 112.2 111.7 111.5 112.4 113.7 114.2 114.4 113.8 16 Foods and tobacco 10.3 110.5 109.8 110.2 110.9 110.5 110.6 111.2 111.9 112.2 112.4 114.3 114.8 115.1 114.7 17 Clothing 2.4 95.9 95.7 96.4 97.2 96.3 96.5 95.9 95.5 96.2 96.2 96.8 96.2 94.8 94.1 18 Chemical products 4.5 129.7 130.3 128.4 129.5 131.4 131.1 129.8 127.5 127.2 130.5 134.0 136.5 135.0 135.2 19 Paper products 2.9 104.7 103.9 105.1 105.6 105.8 105.2 105.9 105.2 103.6 104.6 104.3 103.4 103.8 103.4 70 Energy 2.9 113.9 114.5 110.0 112.4 115.5 114.3 113.1 110.5 109.8 110.6 109.6 109.7 112.6 110.2 71 Fuels .9 106.7 105.8 108.3 107.4 106.5 105.8 105.8 107.4 103.9 109.8 107.4 107.4 108.8 113.8 22 Residential utilities 2.1 116.8 118.1 110.5 114.4 119.3 117.8 116.1 111.8 112.2 110.7 110.3 110.5 114.1 108.5 18.1 126.5 124.3 124.9 125.4 125.8 126.4 127.5 128.0 128.8 128.9 130.1 130.8 131.0 131.1 74 Business equipment 14.0 146.7 142.6 143.5 144.5 145.5 146.9 148.9 149.5 150.9 151.0 152.6 153.7 154.1 154.6 Information processing and related 5.7 176.4 170.0 170.2 171.8 173.7 177.1 179.7 181.1 183.2 184.2 188.3 188.6 189.1 191.6 ?6 Computer and office equipment 1.5 284.2 270.9 270.8 271.6 276.5 282.6 288.9 295.8 300.5 305.7 311.9 317.5 324.8 331.3 77 Industrial 4.0 120.9 117.8 119.2 120.7 120.6 122.1 122.3 123.0 124.4 124.1 124.1 125.8 126.4 126.5 78 2.6 137.9 139.3 138.0 135.3 136.1 132.6 137.9 136.8 137.1 137.5 137.8 139.7 140.8 138.8 79 Autos and trucks 1.2 148.0 148.1 145.9 140.0 141.7 138.2 149.4 147.7 149.2 151.6 152.6 157.2 158.5 155.4 30 Other 1.7 129.4 123.3 127.1 129.4 130.5 132.6 133.5 133.3 134.3 133.1 133.1 133.9 132.8 132.0 31 Defense and space equipment 3.4 71.0 73.7 73.6 72.4 71.3 69.9 69.2 68.8 68.7 69.0 68.7 68.6 67.9 67.8 3? Oil and gas well drilling .5 90.8 92.1 93.2 94.6 94.2 93.7 89.6 93.9 88.3 86.0 86.0 86.7 89.1 85.7 33 Manufactured homes .2 137.3 135.6 132.4 135.2 137.8 133.3 134.5 138.4 142.0 143.1 153.6 153.6 147.4 34 Intermediate products, total 14.3 108.1 106.3 106.9 107.7 108.5 109.1 109.2 108.6 109.9 110.6 110.9 111.2 111.1 110.9 35 Construction supplies 5.3 106.8 103.2 104.7 106.1 106.4 107.9 108.2 108.6 109.7 109.8 111.6 112.1 111.4 111.5 36 Business supplies 9.0 109.1 108.4 108.5 108.8 110.1 110.0 109.9 108.7 110.1 111.3 110.7 110.8 111.1 110.7 37 39.1 121.5 119.5 119.7 120.5 121.2 121.4 122.8 122.9 123.4 124.6 126.3 126.6 126.9 126.7 38 Durable goods materials 20.6 131.2 128.3 129.2 129.8 130.0 130.9 132.6 133.3 134.2 136.0 138.6 139.3 139.1 139.1 39 Durable consumer parts 3.9 132.2 131.5 130.1 129.7 129.2 130.4 133.2 133.1 133.8 135.8 139.7 139.6 139.7 138.3 40 Equipment parts 7.5 143.1 137.9 139.6 140.5 142.1 143.8 145.2 146.7 149.0 150.7 152.3 153.7 155.0 156.0 41 Other 9.1 121.3 119.3 120.4 121.2 120.8 121.1 122.3 122.8 122.7 124.6 127.3 127.8 126.5 126.3 4? Basic metal materials 3.0 119.7 117.6 119.7 120.0 119.6 118.8 119.3 121.1 121.3 123.2 126.0 126.1 124.5 124.4 43 Nondurable goods materials 8.9 118.4 116.7 115.9 118.2 118.1 118.6 120.3 119.8 120.3 121.5 122.8 122.6 122.9 123.2 44 Textile materials 1.1 105.3 104.0 104.4 104.2 104.8 104.8 105.7 105.9 106.9 110.3 108.7 109.8 109.0 109.6 45 Paper materials 1.8 118.7 117.8 116.1 118.9 118.4 117.5 122.5 121.5 120.5 122.1 121.3 120.8 122.0 122.2 46 Chemical materials 4.0 123.2 120.6 120.6 123.8 122.9 123.4 124.8 124.0 124.6 125.9 127.5 128.2 129.2 129.4 47 Other 2.0 116.9 115.6 113.3 114.8 116.5 118.6 118.1 118.2 119.5 119.3 123.4 120.9 119.8 120.2 48 Energy materials 9.6 105.2 105.0 104.8 104.6 106.7 105.2 106.1 105.6 105.2 104.9 105.3 105.4 106.5 105.3 49 Primary energy 6.3 100.3 100.5 100.9 100.4 100.2 100.3 100.9 100.8 100.3 100.7 101.7 101.7 102.5 101.5 50 Converted fuel materials 3.3 114.9 114.0 112.5 112.8 119.9 114.9 116.3 115.1 115.1 113.4 112.3 112.9 114.5 113.0 SPECIAL AGGREGATES 51 Total excluding autos and trucks 97.2 117.6 116.1 116.2 117.1 117.7 118.1 118.7 118.6 119.1 119.8 121.1 121.6 121.6 121.3 52 Total excluding motor vehicles and parts 95.2 117.1 115.5 115.7 116.6 117.3 117.7 118.2 118.0 118.5 119.2 120.5 120.9 121.0 120.7 53 Total excluding computer and office 98.3 115.4 114.0 114.1 114.8 115.4 115.5 116.4 116.1 116.6 117.4 118.7 119.1 111199..11 111188..77 54 Consumer goods excluding autos and trucks . 26.9 112.4 111.9 111.5 112.4 113.2 113.2 113.0 112.4 112.4 113.1 114.5 115.0 114.9 114.1 55 Consumer goods excluding energy 25.6 113.1 112.7 112.5 112.8 113.2 113.2 113.8 113.3 113.3 114.2 116.2 116.8 116.5 115.7 56 Business equipment excluding autos and trucks 12.8 146.5 142.0 143.2 144.8 145.7 147.7 148.8 149.5 151.0 150.9 152.5 153.3 115533..66 115544..44 57 Business equipment excluding computer and office equipment 12.5 130.7 127.6 128.5 129.4 130.0 131.1 132.7 132.7 133.8 113333..66 113344..77 135.5 113355..33 113355..33 58 Materials excluding energy 29.5 127.3 124.8 125.1 126.2 126.4 127.2 128.8 129.2 129.9 131.6 133.8 134.2 134.2 134.3 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value1—Continued 1992 SIC pro- 1994 Group code por- avg. tion Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan.r Feb.' Mar.p Index (1987 = 100) MAJOR INDUSTRIES 59 Total index 100.0 118.1 116.6 116.7 117.4 118.0 118.2 119.1 119.0 119.5 1203 121.7 122.2 1223 121.9 60 Manufacturing 85.5 119.7 118.0 118.4 119.0 119.3 119.8 120.9 120.9 121.5 122.6 124.2 124.7 124.5 124.4 61 Primary processing 26.5 115.3 113.3 114.0 115.2 114.7 115.3 116.3 116.2 116.6 118.4 120.3 120.0 119.5 119.5 62 Advanced processing 59.0 121.8 120.2 120.5 120.8 121.5 121.9 123.1 123.1 123.8 124.6 126.0 126.9 126.9 126.7 63 Durable goods 45.1 125.5 122.9 123.7 124.0 124.6 125.2 127.0 127.2 128.0 129.1 131.2 131.8 131.7 131.6 64 Lumber and products "24 2.0 106.0 104.0 103.9 106.0 106.2 106.8 105.5 107.6 106.7 106.7 110.4 110.1 109.1 108.9 65 Furniture and fixtures 25 1.4 111.4 107.7 110.2 110.1 111.8 114.0 115.5 112.4 114.8 113.0 114.7 116.0 115.3 114.3 66 Stone, clay, and glass products 32 2.1 104.9 103.7 105.0 105.5 104.4 104.3 105.8 105.8 105.4 106.9 110.1 108.2 106.8 107.4 67 Primary metals 33 3.1 114.5 112.1 114.8 114.8 113.7 112.7 113.5 116.0 115.9 119.1 123.0 121.4 119.7 119.5 68 Iron and steel 331,2 1.7 118.3 116.7 121.5 120.9 118.2 116.1 113.0 118.2 118.8 121.9 129.3 125.9 124.2 124.7 69 Raw steel .1 107.9 106.0 105.3 105.7 106.3 104.7 107.0 109.9 109.0 114.2 121.9 114.6 117.2 70 Nonferrous 333-6,9 1.4 109.3 106.0 106.2 106.9 107.6 108.0 113.6 112.7 111.8 115.2 114.8 115.3 113.7 11Z5 71 Fabricated metal products... 34 5.0 110.8 108.5 109.6 110.0 110.2 111.7 112.4 111.6 112.2 113.3 115.3 116.3 115.9 115.4 72 Industrial machinery and equipment 35 7.9 159.9 154.0 156.1 157.7 158.9 160.6 162.6 164.6 166.5 167.5 168.5 171.3 171.4 172.1 73 Computer and office equipment 357 1.7 284.2 270.9 270.8 271.6 276.5 282.6 288.9 295.8 300.5 305.7 311.9 317.5 324.8 331.3 74 Electrical machineiy 36 7.3 160.0 152.6 154.3 156.5 159.5 161.5 164.1 165.0 166.9 168.8 172.5 173.2 173.8 174.2 75 Transportation equipment.. . 37 9.6 109.7 110.7 109.5 107.6 107.5 105.7 109.5 108.8 109.0 110.5 111.9 112.5 113.3 112.2 76 Motor vehicles and parts . 371 4.8 137.9 138.8 136.2 131.6 132.2 129.6 138.1 137.4 138.4 141.4 144.6 146.1 147.5 145.4 77 Autos and light trucks . 371 2.5 131.9 134.7 131.7 124.4 124.6 120.8 131.9 128.4 128.6 132.7 138.4 140.0 142.0 138.8 78 Aerospace and miscellaneous transportation equipment 372-6,9 4.8 82.6 83.8 84.1 84.6 83.8 82.8 82.3 81.4 80.8 80.9 80.6 80.3 80.5 80.5 79 Instruments 38 5.4 107.4 106.9 106.6 106.4 106.8 108.5 108.7 108.0 108.2 107.7 108.9 108.5 107.8 108.5 80 Miscellaneous 39 1.3 116.2 114.1 115.2 115.4 115.8 118.6 117.1 117.0 118.4 118.6 117.6 119.1 120.2 118.7 81 Nondurable goods 40.5 113.3 112.5 112.4 113.4 113.4 113.6 114.0 113.7 114.2 115.4 116.4 116.8 116.6 116.4 82 Foods "20 9.4 112.8 112.9 111.9 112.8 112.8 113.4 113.7 114.6 113.4 113.9 114.7 115.6 115.7 115.6 83 Tobacco products 21 1.6 96.5 93.0 98.1 98.5 95.9 93.7 96.2 96.1 104.5 101.5 108.0 107.8 109.3 108.1 84 Textile mill products 22 1.8 109.0 107.9 108.6 108.9 108.7 109.4 109.0 108.3 110.6 112.0 112.2 113.5 111.5 111.7 85 Apparel products 23 2.2 96.3 95.7 96.2 97.1 97.0 97.0 96.8 96.8 96.9 96.8 97.0 96.6 95.7 94.5 86 Paper and products 26 3.6 117.4 115.7 114.4 116.7 116.6 116.6 120.2 118.7 118.9 121.3 121.7 119.8 120.1 120.0 87 Printing and publishing 27 6.8 101.1 101.3 101.7 101.6 102.4 102.1 101.5 100.9 101.4 102.0 101.6 101.3 101.2 100.9 88 Chemicals and products .... 28 9.9 124.1 123.1 122.4 124.0 124.4 124.7 124.7 123.7 123.8 126.2 128.0 129.9 129.1 129.3 89 Petroleum products 29 1.4 105.3 103.4 107.5 107.0 104.5 104.3 105.2 105.3 104.0 107.6 107.7 107.4 107.5 110.1 90 Rubber and plastic products . 30 3.5 133.5 130.9 130.8 132.4 132.8 134.5 134.5 134.7 136.7 138.3 140.0 140.6 140.7 139.3 91 Leather and products 31 .3 85.8 87.0 87.6 85.9 85.5 86.3 85.5 85.4 85.6 84.5 84.4 82.9 82.7 82.6 92 Mining 6.8 99.8 100.5 100.7 100.7 100.6 100.1 100.0 100.1 99.2 98.3 100.1 99.8 100.3 99.8 93 Metal 10 .4 159.4 165.2 157.0 156.4 162.8 159.5 156.6 160.0 158.9 154.3 156.2 158.4 158.3 158.2 94 Coal 12 1.0 112.0 117.7 118.3 111.5 113.4 108.6 111.4 110.7 110.2 110.1 117.8 117.9 118.6 116.9 95 Oil and gas extraction 13 4.7 93.0 92.9 93.2 94.3 93.8 93.9 93.5 93.7 92.2 91.2 92.2 91.2 91.9 91.2 96 Stone and earth minerals 14 .6 107.0 104.7 105.9 108.1 105.6 107.9 106.6 106.7 109.3 109.9 109.9 113.6 112.2 114.8 97 Utilities 7.7 118.1 117.9 114.7 115.8 121.1 119.0 118.8 116.5 117.2 116.5 115.2 116.0 118.9 115.9 98 Electric 4913PT 6.1 117.8 117.2 116.4 116.2 121.4 119.0 118.4 117.1 117.9 117.5 116.5 117.2 120.3 116.9 99 Gas 492,3PT 1.6 119.2 120.5 107.9 114.1 120.0 118.9 120.4 114.2 114.4 112.3 109.8 111.3 113.3 111.7 SPECIAL AGGREGATES 100 Manufacturing excluding motor vehicles and parts 80.7 118.6 116.7 117.3 118.2 118.6 119.2 119.8 119.9 120.5 121.5 122.9 123.4 123.2 123.1 101 Manufacturing excluding office aanndd ccoommppuuttiinngg mmaacchhiinneess .. .... 83.8 116.5 114.9 115.3 115.9 116.2 116.6 117.6 117.5 118.1 119.1 120.6 121.1 120.8 120.6 1.707.0 2.006.2 1.985.6 1.985.8 1.990.7 2.002.5 2.002.1 2.020.2 2.015.6 2.020.4 2.037.2 2.056.5 2.062.6 2.065.9 2.060.8 Gross value (billions of 1987 dollars, annual rates) MAJOR MARKETS 102 Products, total 1,314.6 1,576.3 1,563.6 1,559.9 1,561.7 1,571.1 1,569.3 1,586.6 1,584.2 1,584.4 1,598.4 1,615.1 1,621.0 1,625.7 1,621.2 103 Final 866.6 982.5 981.3 976.0 977.1 983.0 979.0 987.3 981.5 977.0 988.5 999.6 1,000.2 1,002.3 997.1 104 Consumer goods 448.0 593.8 582.3 583.9 584.5 588.1 590.3 599.3 602.7 607.3 609.9 615.5 620.8 623.3 624.1 105 Equipment 392.5 429.8 422.0 425.9 429.0 431.4 432.9 433.5 431.4 436.0 438.8 441.4 441.5 440.3 439.6 106 Intermediate 1. Data in this table also appear in the Board's G.17 (419) monthly statistical release. Bulletin, vol. 81 (January 1995), pp. 16-26. For a detailed description of the industrial For the ordering address, see the inside front cover. The latest historical revision of the production index, see "Industrial Production: 1989 Developments and Historical Reviindustrial production index and the capacity utilization rates was released in November sion," Federal Reserve Bulletin, vol. 76, (April 1990), pp. 187-204. 1994. See "Industrial Production and Capacity Utilization: A Revision," Federal Reserve 2. Standard industrial classification. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A49 2.14 HOUSING AND CONSTRUCTION Monthly figures at seasonally adjusted annual rates except as noted 1994 1995 IItteemm 11999922 11999933 11999944 May June July Aug. Sept. Oct. Nov. Dec.' Jan.r Feb. Private residential real estate activity (thousands of units except as noted) NEW UNITS 1 Permits authorized 1,095 1,199 1,369 1,383 1,336 1,347 1,382 1,416 1,391 1,355 1,421 1,302 1,287 2 One-family 911 987 1,061 1,099 1,054 1,035 1,047 1,052 1,028 1,011 1,094 999 934 3 Two-family or more 184 213 307 284 282 312 335 364 363 344 327 303 353 4 Started 1,200 1,288 1,457 1,489 1,370 1,440 1,463 1,511 1,451 1,536 1,545 1,366 1,315 5 One-family 1,030 1,126 1,198 1,197 1,174 1,219 1,174 1,235 1,164 1,186 1,250 1,055 1,041 6 Two-family or more 170 162 259 292 196 221 289 276 287 350 295 311 274 7 Under constniction at end of period 612 680 762r 746 751 757 770 773 779 787 791 793 805 8 One-family 473 543 558r 581 585 585 589 590 587 587 584 579 585 9 Two-or-more-family 140 137 204 165 166 172 181 183 192 200 207 214 220 10 Completed 1,158 1,193 1,347 1,438 1,333 1,280 1,337 1,400 1,376 1,371 1,388 1,428 1,292 11 One-family 964 1,040 1,160 1,245 1,151 1,157 1,144 1,158 1,169 1,136 1,173 1,205 1,070 12 Two-or-more-family 194 153 187 193 182 123 193 242 207 235 215 223 222 13 Mobile homes shipped 210 254 304 296 295 289 295 307 314 322 347 361 335 Merchant builder activity in one-family units 14 Number sold 610 666 670r 689 632 630 672 691 707 642r 662255 641 555511 15 Number for sale at end of period 265 293 341 302 313 317 322 328 330 335 341 344 350 Price of units sold (thousands of dollars) 121.3 126.1 130.4r 129.9 133.5 124.4 133.3 129.7 132.0 129.9 113355..00 112277..99 112299..99 17 Average 144.9 147.6 153.8r 151.8 158.4 144.4 154.9 157.2 153.0 155.4 160.1 147.4 155.7 EXISTING UNITS (one-family) 18 Number sold 3,520 3,800 3,946 4,110 4,010 3,940 3,910 3,870 3,820 3,690 3,760 3,610 3,420 Price of units sold (thousands of dollars)2 19 Median 103.6 106.5 109.6 109.9 113.3 112.4 113.0 108.9 107.5 108.7 109.1 108.1 110077..00 20 Average 130.8 133.1 136.4 136.7 141.3 139.7 141.2 135.8 133.0 134.7 135.6 135.3 133.4 Value of new constniction (millions of dollars)3 CONSTRUCTION 21 Total put in place 435355 466,365 506,315 504,356 506,144 505,445 505,470 514,197 519,336' 522,106r 528,613 525,738 523,338 7? 316,115 341,101 377,136 378,235 379,345 376,463 376,216 382,287 383,044R 390,729' 393,171 392,049 391,111 73 187,870 210,455 237,767 241,162 240,694 237,775 236,871 238,529 239,136R 241,320' 243,768 242,527 241,212 74 128,245 130,646 139,369 137,073 138,651 138,688 139,345 143,758 143,908R 149,409' 149,403 149,522 149,899 75 Industrial buildings 20,720 19,533 21,600 21,338 20,960 21,117 22,012 22,621 22,19TF 25,050' 23,074 23,367 25,430 7.6 Commercial buildings 41,523 42,627 48,268 47,912 48,410 48,607 48,185 50,180 50,583' 51,993' 53,272 54,162 54,736 77 Other buildings 21,494 23,626 23,835 23,956 24,439 23,838 23,648 24,784 24,103' 24,325' 24,851 24,456 24,696 28 Public utilities and other 44,508 44,860 45,666 43,867 44,842 45,126 45,500 46,173 47,032' 48,041' 48,206 47,537 45,037 79 Public 119,238 125,262 129,175 126,121 126,799 128,982 129,255 131,910 136,292' 131,377' 135,443 133,689 132,227 10 Military 2,502 2,454 2,315 2,024 2,277 2,351 2,357 2,364 2,329' 2,247' 2,481 2,624 2,634 31 Highway 34,899 37,355 40,185 40,655 40,300 40,305 40,057 40,797 41,685' 40,011' 39,256 39,348 39,467 32 Conservation and development 6,021 5,976 6,236 5,677 4,605 5,935 5,754 7,521 7,135' 6,658' 7,765 7,365 7,400 33 Other 75,816 79,477 80,439 77,765 79,617 80,391 81,087 81,228 85,143' 82,461' 85,941 84,352 82,726 1. Not at annual rates. SOURCES. Bureau of the Census estimates for all series except (1) mobile homes, which 2. Not seasonally adjusted. are private, domestic shipments as reported by the Manufactured Housing Institute and 3. Recent data on value of new construction may not be strictly comparable with data seasonally adjusted by the Census Bureau, and (2) sales and prices of existing units, for previous periods because of changes by the Bureau of the Census in its estimating which are published by the National Association of Realtors. All back and current figures techniques. For a description of these changes, see Construction Reports (C-30-76-5), are available from the originating agency. Permit authorizations are those reported to the issued by the Census Bureau in July 1976. Census Bureau from 17,000 jurisdictions beginning in 1984. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 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 (annual rate) Change from 1 month earlier IIInnndddeeexxx IIIttteeemmm llleeevvveeelll,,, 1994 1995 1994 1995 MMMaaarrr... 11999944 11999955 111999999555 111 MMaarr.. MMaarr.. June Sept. Dec. Mar. Nov. Dec. Jan. Feb. Mar. CONSUMER PRICES2 (1982-84=100) 1 AH items 2.5 2.9 2.7 3.6 1.9 3.2 .1 .2 .3 3 .2 151.4 2 Food 2.2 2.9 2.8 5.1 3.9 .0 .1 .8 -.3 .3 .0 147.4 3 Energy items -.6 1.3 -3.0 9.2 .4 -1.1 .5 -.1 .3 -.1 -.5 103.2 4 All items less food and energy 2.9 3.0 3.1 2.6 2.0 4.1 .2 .1 .4 .3 .3 160.4 5 Commodities 1.0 1.8 3.9 .9 .3 2.6 .0 .1 .4 .1 .1 139.4 6 Services 3.8 3.5 2.7 3.6 2.6 4.8 .2 .2 .5 .4 .4 172.4 PRODUCER PRICES (1982=100) 7 Finished goods .2 1.6 .0 1.9 2.2 2.6 .6 ,3r .3 .3 .0 126.9 8 Consumer foods 2.2 .8 -5.5 1.9 9.2 -1.8 1.0r 1.3r -.6 .3 -.2 128.5 9 Consumer energy -3.6 2.3 -2.6 3.2 .0 9.1 2.2r -.9' 2.3 .4 -.5 76.4 10 Other consumer goods -.6 1.7 2.0 1.7 .6 2.6 ,2r .2' .1 .3 .2 141.0 11 Capital equipment 1.8 1.8 3.0 2.1 .0 2.1 .1 .4 .3 .3 -.1 136.0 Intermediate materials 12 Excluding foods and feeds .4 6.4 2.8 6.2 7.6 9.5 .9 .5 1.0 1.0 .3 124.3 13 Excluding energy 1.0 7.1 3.9 6.8 8.3 9.8 .8 .5 1.0 1.0 .4 134.1 Crude materials 14 Foods 5.4 -9.6 -18.0 -13.5 -.8 -5.4 ,9r .O1 -.1 1.2 -2.4 103.2 15 Energy -7.7 -3.5 21.0 -19.2 -13.8 2.9 -1.3r -,9r -.1 1.7 -.9 69.2 16 Other 10.8 16.5 -.8 20.3 26.7 21.1 3.4r 1.9r 3.0 1.4 .5 178.3 1. Not seasonally adjusted. SOURCE. U.S. Department of Labor, Bureau of Labor Statistics. 2. Figures for consumer prices are for all urban consumers and reflect a rentalequivalence measure of homeownership. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A51 2.16 GROSS DOMESTIC PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates 1993 1994 AAccccoouunntt 11999922 11999933 11999944rr Q4 Q1 Q2 Q3 Q4r GROSS DOMESTIC PRODUCT 1 Total 6,020.2 6,343.3 6,738.4 6,478.1 6,574.7 6,689.9 6,791.7 6,897.2 By source 2 Personal consumption expenditures 4,136.9 4,378.2 4,628.4 4,469.6 4,535.0 4,586.4 4,657.5 4,734.8 3 Durable goods 492.7 538.0 591.5 562.8 576.2 580.3 591.5 617.7 4 Nondurable goods 1,295.5 1,339.2 1,394.3 1,355.2 1,368.9 1,381.4 1,406.1 1,420.7 5 Services 2,348.7 2,501.0 2,642.7 2,551.6 2,589.9 2,624.7 2,659.9 2,696.4 6 Gross private domestic investment 788.3 882.0 1,032.9 922.5 966.6 1,034.4 1,055.1 1,075.6 7 Fixed investment 785.2 866.7 980.7 913.5 942.5 967.0 992.5 1,020.8 8 Nonresidential 561.4 616.1 697.6 646.3 665.4 683.3 709.1 732.8 9 Structures 171.1 173.4 182.8 176.7 172.7 181.8 184.6 192.0 10 Producers' durable equipment 390.3 442.7 514.8 469.6 492.7 501.5 524.5 540.7 11 Residential structures 223.8 250.6 283.0 267.2 277.1 283.6 283.4 288.0 12 Change in business inventories 3.0 15.4 52.2 9.0 24.1 67.4 62.6 54.8 13 Nonfarm -2.7 20.1 45.9 10.7 22.3 60.4 53.4 47.4 14 Net exports of goods and services -30.3 -65.3 -98.2 -71.2 -86.7 -97.6 -109.6 -98.9 15 Exports 638.1 659.1 718.7 680.3 674.2 704.5 730.5 765.5 16 Imports 668.4 724.3 816.9 751.4 760.9 802.1 840.1 864.4 17 Government purchases of goods and services 1,125.3 1,148.4 1,175.3 1,157.2 1,159.8 1,166.7 1,188.8 1,185.8 18 Federal 449.0 443.6 437.3 439.8 437.8 435.1 444.3 431.9 19 State and local 676.3 704.7 738.0 717.4 722.0 731.5 744.5 753.8 By major type of product 20 Final sales, total 6,017.2 6,327.9 6,686.2 6,469.2 6,550.6 6,622.5 6,729.1 6,842.4 21 Goods 2,292.0 2,390.4 2,532.4 2,452.6 2,489.1 2,493.7 2,543.6 2,603.3 22 Durable 968.6 1,032.4 1,118.8 1,072.9 1,098.2 1,099.4 1,125.8 1,151.8 2.3 Nondurable 1,323.4 1,358.1 1,413.6 1,379.7 1,390.9 1,394.3 1,417.8 1,451.5 24 Services 3,227.2 3,405.5 3,576.2 3,459.3 3,503.8 3,555.4 3,603.6 3,641.9 25 Structures 498.1 532.0 577.6 557.2 557.7 573.4 581.9 597.3 26 Change in business inventories 3.0 15.4 52.2 9.0 24.1 67.4 62.6 54.8 27 Durable goods -13.0 8.6 34.8 9.0 20.6 38.2 44.1 36.3 28 Nondurable goods 16.0 6.7 17.4 .0 3.5 29.2 18.5 18.5 MEMO 29 Total GDP in 1987 dollars 4,979.3 5,134.5 5,344.0 5,218.0 5,261.1 5,314.1 5,367.0 5,433.8 NATIONAL INCOME 30 Total 4,829.5 5,131.4 5,458.4 5,262.0 5,308.7 5,430.7 5,494.9 5,599.4 31 Compensation of employees 3,591.2 3,780.4 4,004.6 3,845.8 3,920.0 3,979.3 4,023.7 4,095.3 32 Wages and salaries 2,954.8 3,100.8 3,279.0 3,148.4 3,208.3 3,257.2 3,293.9 3,356.4 33 Government and government enterprises 567.3 583.8 602.8 587.8 595.7 601.9 604.4 609.0 34 Other 2,387.5 2,517.0 2,676.2 2,560.7 2,612.6 2,655.4 2,689.6 2,747.4 35 Supplement to wages and salaries 636.4 679.6 725.6 697.4 711.7 722.0 729.7 738.9 36 Employer contributions for social insurance 307.7 324.3 344.6 330.6 338.5 343.6 346.0 350.2 37 Other labor income 328.7 355.3 381.0 366.8 373.2 378.4 383.7 388.7 38 Proprietors' income1 418.7 441.6 473.7 462.9 471.0 471.3 467.0 485.7 39 Business and professional1 374.4 404.3 434.2 418.5 423.8 431.9 437.1 444.0 40 Farm1 44.4 37.3 39.5 44.4 47.2 39.3 29.8 41.7 41 Rental income of persons2 -5.5 24.1 27.7 30.3 15.3 34.1 32.6 29.0 42 Corporate profits1 405.1 485.8 542.7 533.9 508.2 546.4 556.0 560.3 43 Profits before tax3 395.9 462.4 524.5 501.7 483.5 523.1 538.1 553.5 44 Inventory valuation adjustment -6.4 -6.2 -19.5 -6.5 -12.3 -14.1 -19.6 -32.1 45 Capital consumption adjustment 15.7 29.5 37.7 38.8 37.0 37.4 37.5 38.8 46 Net interest 420.0 399.5 409.7 389.1 394.2 399.7 415.7 429.2 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. US. Department of Commerce, Survey of Current Business. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • June 1995 2.17 PERSONAL INCOME AND SAVING Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates Q4 QL Q2 Q3 PERSONAL INCOME AND SAVING 1 Total personal income 5,1543 5,375.1 5,701.7R 5,484.6 5,555.8 5,659.9 5,734.5 2 3 Wa C g o e m a m nd o d s i a t l y a - r p y r o d d is u b c u in rs g e m in e d n u t s s t ries 2,9 7 7 5 4 7 . . 8 6 3,0 7 8 7 0 3 . . 8 8 3,2 8 7 1 9 8 . . 0 2 r 3,1 7 4 9 8 1 . . 4 0 3,2 8 0 0 8 1 . . 3 9 3,2 8 5 11 7 . .2 6 3,2 8 9 21 3 . .9 8 4 5 Di M str a ib n u u t f i a v c e t u i r n i d ng u stries 5 6 7 8 8 2 . . 3 3 5 7 8 0 8 1 . . 4 9 6 7 1 4 7 8 . . 5 5 r 6 7 0 1 1 2 . . 7 6 6 7 0 2 9 8 . . 4 6 6 74 1 2 2 . . 5 8 6 75 1 3 8 . . 5 3 6 Service industries 967.6 1,021.4 1,109.5 1,057.0 1,082.0 1,101.2 1,114.3 7 Government and government enterprises 567.3 583.8 602.8 587.8 595.7 601.9 604.4 8 Other labor income 328.7 355.3 381.0 366.8 373.2 378.4 383.7 9 Proprietors' income1 418.7 441.6 473.7r 462.9 471.0 471.3 467.0 10 Business and professional1 374.4 404.3 434.2 418.5 423.8 431.9 437.1 11 Farm1 44.4 37.3 39.5r 44.4 47.2 39.3 29.8 12 Rental income of persons2 -5.5 24.1 27.7 30.3 15.3 34.1 32.6 13 Dividends 161.0 181.3 194.3 184.1 185.7 191.7 196.9 14 Personal interest income 665.2 637.9 664.0' 627.7 631.1 649.4 674.2 15 Transfer payments 860.2 915.4 963.4 931.0 947.4 957.6 969.0 16 Old-age survivors, disability, and health insurance benefits 414.0 444.4 473.5 476.5 452.1 463.8 470.7 17 LESS: Personal contributions for social insurance 248.7 261.3 281.4 282.9 266.6 276.3 279.9 18 EQUALS: Personal income 5,154.3 5.375.1 5,701.7r 5,484.6 5,555.8 5,659.9 5,734.5 19 LESS: Personal tax and nontax payments 648.6 686.4 742.1 707.0 723.0 746.4 744.1 20 EQUALS: Disposable personal income 4,505.8 4,688.7 4,959,6r 4,777.6 4,832.8 4,913.5 4,990.3 21 LESS: Personal outlays 4,257.8 4.496.2 4,756.5r 4,588.2 4,657.3 4,712.4 4,787.0 22 EQUALS: Personal saving 247.9 192.6 203.lr 189.4 175.5 201.1 203.3 MEMO Per capita (1987 dollars) 23 Gross domestic product 19,489.7 19,878.8 20,475.8' 20,119.1 20,235.2 20,389.7 20.536.5 2 2 4 5 P D e i r s s p o o n s a a l b l c e o n p s e u rs m o p n t a i l o n in e c x o p m e e n ditures 1 1 3 4 , , 1 2 1 7 0 9 . . 4 0 1 1 3 4 , , 3 3 9 4 0 1 . . 8 0 1 1 3 4 , , 7 6 1 9 5 6 . . 4 0 " r 1 1 3 4 , , 5 4 1 5 8 1 . . 9 0 1 1 3 4 , , 6 5 3 3 9 5 . . 8 0 1 1 3 4 , , 6 6 5 2 0 5 . . 9 0 1 14 3 , . 6 7 9 1 7 6 . . 0 6 26 Saving rate (percent) GROSS SAVING 27 Gross saving 722.9 787.5 920.6 825.8 886.2 922.6 28 Gross private saving 980.8 1,002.5 1,053.5 1,011.4 1,037.3 1,041.4 1,052.7 29 Personal saving 247.9 192.6 203.1r 189.4 175.5 201.1 203.3 30 Undistributed corporate profits1 94.3 120.9 135.1 147.9 127.7 142.3 139.5 31 Corporate inventory valuation adjustment -6.4 -6.2 -19.5r -6.5 -12.3 -14.1 -19.6 Capital consumption allowances 32 Corporate 396.8 407.8 432.2 411.1 432.2 425.9 432.6 33 Noncorporate 261.8 261.2 283.1r 263.0 301.8 272.1 277.3 34 Government surplus, or deficit (—), national income and product accounts -257.8 -215.0 -132.9 -185.6 -151.1 -118.1 -130.1 35 Federal -282.7 -241.4 -159.1 -220.1 -176.2 -145.1 -154.0 36 State and local 24.8 26.3 26.2 34.5 25.2 27.0 23.9 37 Gross investment 889.7 38 Gross private domestic investment 788.3 882.0 1,032.9' 922.5 966.6 1,034.4 1,055.1 39 Net foreign investment -56.6 -92.3 -143.2 -113.2 -116.4 -135.1 -153.6 40 Statistical discrepancy -24.0 1. With inventory valuation and capital consumption adjustments. SOURCE. U.S. Department of Commerce, Survey of Current Business. 2. With capital consumption adjustment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Summary Statistics A53 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data seasonally adjusted except as noted1 1993 1994 IItteemm ccrreeddiittss oorr ddeebbiittss 11999922 11999933 11999944 Q4 QL Q2 Q3 Q4P 1 Balance on current account -67,886 -103,896 -155,672 -30,587 -32,238 -37,827 -40,848 -44,758 ? Merchandise trade balance2 -96,097 -132,575 -166,364 -33,169 -37,052 -41,721 -44,615 -42,976 3 Merchandise exports 440,361 456,866 502,729 119,679 117,848 122,510 127,632 134,739 4 Merchandise imports -536,458 -589,441 -669,093 -152,848 -154,900 -164,231 -172,247 -177,715 Military transactions, net -3,034 -763 268 -444 -338 177 230 199 6 Other service transactions, net 58,747 57,613 59,726 13,637 13,070 14,907 15,647 16,102 7 Investment income, net 4,540 3,946 -15,181 -590 -820 -2,819 -4,037 -7,504 8 U.S. government grants -15,010 -14,620 -14,532 -5,591 -2,371 -3,590 -2,839 -5,731 9 U.S. government pensions and other transfers -3,735 -3,785 -4,246 -987 -889 -895 -1,474 -988 10 Private remittances and other transfers -13,297 -13,712 -15,343 -3,443 -3,838 -3,886 -3,760 -3,860 11 Change in U.S. government assets other than official reserve assets, net (increase, —) -1,652 -306 -277 -321 490 462 -270 --996611 12 Change in U.S. official reserve assets (increase, —) 3,901 -1,379 5,346 -673 -59 3,537 -165 2,033 13 0 0 0 0 0 0 0 0 14 Special drawing rights (SDRs) 2,316 -537 -441 -113 -101 -108 -111 -121 15 Reserve position in International Monetary Fund -2,692 -44 494 -80 -3 251 273 -27 16 Foreign currencies 4,277 -797 5,293 -480 45 3,394 -327 2,181 17 Change in U.S. private assets abroad (increase, -) -63,759 -146,214 -130,756 -62,628 -48,887 -11,250 -25,414 -45,208 18 Bank-reported claims3 22,314 32,238 -2,033 -9,293 -1,236 15,248 1,268 -17,313 19 Nonbank-reported claims 45 -598 -9,679 -303 1,941 -4,264 -7,356 20 U.S. purchases of foreign securities, net -45,114 -119,983 -60,621 -30,349 -24,605 -14,007 -8,103 -13,906 21 U.S. direct investments abroad, net -41,004 -57,871 -58,423 -22,683 -24,987 -8,227 -11,223 -13,989 22 Change in foreign official assets in United States (increase, +) 40,858 71,681 38,912 23,962 11,530 8,925 19,460 -1,003 23 U.S. Treasury securities 18,454 48,702 30,441 22,856 1,193 6,033 15,841 7,374 24 Other U.S. government obligations 3,949 4,062 5,988 970 50 2,355 2,003 1,580 25 Other US. government liabilities4 2,572 1,666 2,514 825 938 252 700 624 26 Other U.S. liabilities reported by U.S. banks3 16,571 14,666 2,317 -587 10,139 1,241 1,695 -10,758 27 Other foreign official assets5 -688 2,585 -2,348 -102 -790 -956 -779 177 28 Change in foreign private assets in United States (increase, +) 105,646 159,017 275,702 66,200 83,600 40,384 60,794 90,924 29 U.S. bank-reported liabilities3 15,461 18,452 106,189 7,370 35,200 25,539 18,353 27,097 30 U.S. nonbank-reported liabilities 13,573 14,282 17,955 4,733 5,867 3,662 8,426 31 Foreign private purchases of U.S. Treasury securities, net 36,857 24,849 32,925 7,996 9,260 -7,434 5,111 25,988 32 Foreign purchases of other U.S. securities, net 29,867 80,068 58,562 38,008 21,258 13,152 14,168 9,984 33 Foreign direct investments in United States, net 9,888 21,366 60,071 8,093 12,015 5,465 14,736 27,855 34 Allocation of special drawing rights 0 0 0 0 0 0 0 0 35 Discrepancy -17,108 21,096 -33,255 4,047 -14,436 -4,231 -13,557 -1,027 36 Due to seasonal adjustment 103 5,899 728 -6,686 62 37 Before seasonal adjustment -17,108 21,096 -33,255 3,944 -20,335 -4,959 -6,871 -1,089 MEMO Changes in official assets 38 U.S. official reserve assets (increase, —) 3,901 -1,379 5,346 -673 -59 3,537 -165 22,,003333 39 Foreign official assets in United States, excluding line 25 (increase, +) 38,286 70,015 36,398 23,137 10,592 8,673 18,760 -1,627 40 Change in Organization of Petroleum Exporting Countries official assets in United States (part of line 22) 5,942 -3,847 -1,049 -229 -1,674 -4,149 3,726 11,,004488 1. Seasonal factors are not calculated for lines 12-16, 18-20, 22-34, and 38^0. 4. Associated primarily with military sales contracts and other transactions arranged 2. Data are on an international accounts basis. The data differ from the Census basis with or through foreign official agencies. data, shown in table 3.11, for reasons of coverage and timing. Military exports are 5. Consists of investments in U.S. corporate stocks and in debt securities of private excluded from merchandise trade data and are included in line S. corporations and state and local governments. 3. Reporting banks include all types of depository institution as well as some brokers SOURCE. U.S. Department of Commerce, Bureau of Economic Analysis, Survey of and dealers. Current Business. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 International Statistics • June 1995 3.11 U.S. FOREIGN TRADE1 Millions of dollars; monthly data seasonally adjusted 1994 1995 IItteemm 11999922 11999933 11999944 Aug. Sept. Oct. Nov. Dec. Jan. Feb.p 1 Goods and services, balance -40,384 -75,725 -106,571 -9,124 -8,879 -9,996 -9,628 -7,261 -11,953 -9,012 2 Merchandise -96,097 -132,575 -166,565 -14,141 -14,517 -15,117 -15,170 -12,896 -16,853 -14,195 3 Services 55,713 56,850 59,994 5,017 5,638 5,121 5,542 5,635 4,900 5,183 4 Goods and services, exports 616,924 641,677 697,877 60,291 60,510 59,881 61,909 63,611 60,964 62,416 5 Merchandise 440,361 456,866 502,590 44,054 43,485 43,289 44,814 46,490 44,299 45,498 6 Services 176,563 184,811 195,287 16,237 17,025 16,592 17,095 17,121 16,665 16,918 7 Goods and services, imports -657,308 -717,402 -804,448 -69,415 -69,389 -69,877 -71,537 -70,872 -72,917 -71,428 8 Merchandise -536,458 -589,441 -669,155 -58,195 -58,002 -58,406 -59,984 -59,386 -61,152 -59,693 9 Services -120,850 -127,961 -135,293 -11,220 -11,387 -11,471 -11,553 -11,486 -11,765 -11,735 MEMO 10 Balance on merchandise trade, Census basis -84,501 -115,568 -151,308 -12,788 -13,418 -13,845 -14,092 -11,644 -15,910 -13,255 1. Data show monthly values consistent with quarterly figures in the U.S. balance of SOURCE. FT900, U.S. Department of Commerce, Bureau of the Census and Bureau of payments accounts. Economic Analysis. 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period 1994 1995 AAsssseett 11999911 11999922 11999933 Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar.p 1 Total 77,719 71,323 73,442 75,740 76,532 78,172 74,000 74,335 76,027 81,439 86,761 2 Gold stock, including Exchange Stabilization Fund1 11,057 11,056 11,053 11,054 11,054 11,053 11,052 11,051 11,050 11,050 11,053 3 Special drawing rights2,3 11,240 8,503 9,039 9,837 9,971 10,088 10,017 10,039 10,154 11,158 11,651 4 Reserve position in International Monetary Fund2 9,488 11,759 11,818 12,161 12,067 12,339 12,037 12,030 12,120 12,853 13,418 5 Foreign currencies4 45,934 40,005 41,532 42,688 43,440 44,692 40,894 41,215 42,703 46,378 50,639 1. Gold held "under earmark" at Federal Reserve Banks for foreign and international been used. U.S. SDR holdings and reserve positions in the IMF also have been valued on accounts is not included in the gold stock of the United States; see table 3.13, line 3. Gold this basis since July 1974. stock is valued at $42.22 per fine troy ounce. 3. Includes allocations of SDRs by the International Monetary Fund on Jan. 1 of the 2. Special drawing rights (SDRs) are valued according to a technique adopted by the year indicated, as follows: 1970—$867 million; 1971—$717 million; 1972—$710 mil- International Monetary Fund (IMF) in July 1974. Values are based on a weighted average lion; 1979—$1,139 million; 1980—$1,152 million; 1981—$1,093 million; plus net of exchange rates for the currencies of member countries. From July 1974 through transactions in SDRs. December 1980, sixteen currencies were used; since January 1981, five currencies have 4. Valued at current market exchange rates. 3.13 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS1 Millions of dollars, end of period 1994 1995 AAsssseett 11999911 11999922 11999933 Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar.p 1 Deposits 968 205 386 188 342 223 230 250 185 188 370 Held in custody 2 U.S. Treasury securities2 281,107 314,481 379,394 427,574 429,819 439,854 444,339 441,866 439,139 447,206 459,694 3 Earmarked gold3 13,303 13,118 12,327 12,044 12,044 12,039 12,037 12,033 12,033 12,033 11,964,301 1. Excludes deposits and U.S. Treasury securities held for international and regional 3. Held in foreign and international accounts and valued at $42.22 per fine troy ounce; organizations. not included in the gold stock of the United States. 2. Marketable U.S. Treasury bills, notes, and bonds and nonmarketable U.S. Treasury securities, in each case measured at face (not market) value. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Summary Statistics A55 3.15 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1994r 1995 IItteemm 11999922 11999933 Aug. Sept. Oct. Nov. Dec. Jan. Feb.P 1 Total1 412,624 483,058r 518,832 521,015 531,102 523,536 519,822 516,330 526,300 By type 2 Liabilities reported by banks in the United States 54,967 69,808 79,598 82,587 79,361 73,507 72,708 74,070 80,022 3 U.S. Treasury bills and certificates3 104,596 151,100r 143,640 138,451 148,039 143,222 139,570 133,014 134,341 U.S. Treasury bonds and notes 210,931 212,253 242,951 247,639 250,530 253,196 253,778 255,525 257,587 5 Nonmarketable4 4,532 5,652 5,952 5,990 6,031 6,069 6,109 6,137 6,095 6 U.S. securities other than U.S. Treasury securities5 37,598 44,245 46,691 46,348 47,141 47,542 47,657 47,584 48,255 By area 7 Europe1 189,230 207,121r 226,280 225,974 223,326 217,511 215,398 212,519 214,008 8 Canada 13,700 15,285 18,586 19,287 18,402 17,339 17,046 17,852 18,466 9 Latin America and Caribbean 37,973 55,898 44,144 44,427 47,844 45,285 41,268 37,058 42,032 10 Asia 164,690 197,758 221,197 223,027 232,099 233,582 236,102 239,291 243,865 3,723 4,052 4,255 4,388 4,232 4,673 4,179 4,335 4,066 12 Other countries6 3,306 2,942 4,368 3,910 5,197 5,144 5,827 5,273 3,861 1. Includes the Bank for International Settlements. 5. Debt securities of U.S. government corporations and federally sponsored agencies, 2. Principally demand deposits, time deposits, bankers acceptances, commercial paper, and U.S. corporate stocks and bonds. negotiable time certificates of deposit, and borrowings under repurchase agreements. 6. Includes countries in Oceania and Eastern Europe. 3. Includes nonmarketable certificates of indebtedness (including those payable in SOURCE. Based on U.S. Department of the Treasury data and on data reported to the foreign currencies through 1974) and Treasury bills issued to official institutions of department by banks (including Federal Reserve Banks) and securities dealers in the foreign countries. United States, and on the 1989 benchmark survey of foreign portfolio investment in the 4. Excludes notes issued to foreign official nonreserve agencies. Includes bonds and United States. notes payable in foreign currencies; zero coupon bonds are included at current value. 3.16 LIABILITIES TO, AND CLAIMS ON, FOREIGNERS Reported by Banks in the United States' Payable in Foreign Currencies Millions of dollars, end of period 1994r IItteemm 11999911 11999922 11999933rr Mar. June Sept. Dec. 1 Banks' liabilities 75,129 72,796 78,120 86,706 72,490 82,293 89,574 2 Banks' claims 73,195 62,799 60,649 74,670 56,669 59,261 54,448 3 Deposits 26,192 24,240 20,284 21,139 21,490 20,419 19,798 4 Other claims 47,003 38,559 40,365 53,531 35,179 38,842 34,650 5 Claims of banks' domestic customers2 3,398 4,432 4,100 4,696 4,732 5,466 9,508 1. Data on claims exclude foreign currencies held by U.S. monetary authorities. 2. Assets owned by customers of the reporting bank located in the United 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

A56 International Statistics • June 1995 3.17 LIABILITIES TO FOREIGNERS Reported by Banks in the United States1 Payable in U.S. dollars Millions of dollars, end of period 1994' 1995 IItteemm 11999922 11999933 11999944'' Aug. Sept. Oct. Nov. Dec. Jan. Feb.p BY HOLDER AND TYPE OF LIABILITY 1 Total, all foreigners 810,259 921,796r 1,008,244 999,013 999,386 1,011,497 988,352 1,008,244 1,008,443 1,017,799 2 Banks' own liabilities 606,444 623,432' 714,944 693,613 707,452 709,734 686,602 714,944 721,152 724,259 3 Demand deposits 21,828 21,573' 25,831 23,147 23,522 24,614 23,954 25,831 27,551 26,630 4 Time deposits2 160,385 175,078' 185,835 184,333 178,277 181,406 178,348 185,835 187,582 185,948 5 Other3 93,237 110,144 109,162 119,087 134,762 133,805 124,309 109,162 120,283 122,995 6 Own foreign offices4 330,994 316,637' 394,116 367,046 370,891 369,909 359,991 394,116 385,736 388,686 7 Banks' custodial liabilities5 203,815 298,364' 293,300 305,400 291,934 301,763 301,750 293,300 287,291 293,540 8 U.S. Treasury bills and certificates6 127,644 176,739' 162,786 170,851 164,555 174,441 169,056 162,786 156,664 160,353 9 Other negotiable and readily transferable instruments7 21,974 36,289 41,552 46,371 38,988 37,661 39,834 41,552 40,442 43,378 10 Other 54,197 85,336 88,962 88,178 88,391 89,661 92,860 88,962 90,185 89,809 11 Nonmonetary international and regional organizations8... 9,350 10,936 4,639 5,323 7,619 7,824 6,207 4,639 6,226 6,984 12 Banks' own liabilities 6,951 5,639 4,209 4,328 6,642 6,047 5,441 4,209 5,760 6,335 13 Demand deposits 46 15 29 56 28 83 35 29 24 35 14 Time deposits2 3,214 2,780 2,641 2,671 2,989 3,095 2,817 2,641 3,331 3,284 15 Other3 3,691 2,844 1,539 1,601 3,625 2,869 2,589 1,539 2,405 3,016 16 Banks' custodial liabilities5 2,399 5,297 430 995 977 1,777 766 430 466 649 17 U.S. Treasury bills and certificates6 1,908 4,275 281 836 767 1,572 501 281 280 407 18 Other negotiable and readily transferable instruments7 486 1,022 149 159 205 205 265 149 181 242 19 Other 5 0 0 0 5 0 0 0 5 0 20 Official institutions9 159,563 220,908' 212,278 223,238 221,038 227,400 216,729 212,278 207,084 214,363 21 Banks' own liabilities 51,202 64,231 59,257 67,411 72,114 67,505 60,717 59,257 62,058 67,010 22 Demand deposits 1,302 1,601 1,564 1,232 1,691 2,028 1,682 1,564 1,598 1,588 23 Time deposits2 17,939 21,654 23,175 25,746 26,920 23,812 20,626 23,175 22,622 25,514 24 Other3 31,961 40,976 34,518 40,433 43,503 41,665 38,409 34,518 37,838 39,908 25 Banks' custodial liabilities5 108,361 156,677' 153,021 155,827 148,924 159,895 156,012 153,021 145,026 147,353 26 U.S. Treasury bills and certificates6 104,596 151,IOC 139,570 143,640 138,451 148,039 143,222 139,570 133,014 134,341 27 Other negotiable and readily transferable instruments7 3,726 5,482 13,245 12,054 10,407 11,820 12,773 13,245 11,972 12,943 28 Other 39 95 206 133 66 36 17 206 40 69 29 Banks10 547,320 589,077' 677,720 657,549 651,642 657,476 646,539 677,720 677,550 677,676 30 Banks' own liabilities 476,117 477,050' 565,013 536,834 538,600 545,707 532,625 565,013 564,540 562,036 31 Unaffiliated foreign banks 145,123 160,413 170,897 169,788 167,709 175,798 172,634 170,897 178,804 173,350 32 Demand deposits 10,170 9,719 13,082 11,832 10,555 11,023 11,259 13,082 14,373 13,527 33 Time deposits2 90,296 105,192 111,474 107,110 101,715 106,646 106,043 111,474 112,206 107,482 34 Other3 44,657 45,502 46,341 50,846 55,439 58,129 55,332 46,341 52,225 52,341 35 Own foreign offices4 330,994 316,637' 394,116 367,046 370,891 369,909 359,991 394,116 385,736 388,686 36 Banks' custodial liabilities5 71,203 112,027' 112,707 120,715 113,042 111,769 113,914 112,707 113,010 115,640 37 U.S. Treasury bills and certificates6 11,087 10,712' 11,218 12,268 10,975 10,783 11,792 11,218 10,992 12,328 38 Other negotiable and readily transferable instruments7 7,555 17,020 14,234 22,004 15,343 13,228 13,530 14,234 14,137 15,232 39 Other 52,561 84,295 87,255 86,443 86,724 87,758 88,592 87,255 87,881 88,080 40 Other foreigners 94,026 100,875' 113,607 112,903 119,087 118,797 118,877 113,607 117,583 118,776 41 Banks' own liabilities 72,174 76,512' 86,465 85,040 90,096 90,475 87,819 86,465 88,794 88,878 42 Demand deposits 10,310 10,238' 11,156 10,027 11,248 11,480 10,978 11,156 11,556 11,480 43 Time deposits2 48,936 45,452' 48,545 48,806 46,653 47,853 48,862 48,545 49,423 49,668 44 Other3 12,928 20,822 26,764 26,207 32,195 31,142 27,979 26,764 27,815 27,730 45 Banks' custodial liabilities5 21,852 24,363' 27,142 27,863 28,991 28,322 31,058 27,142 28,789 29,898 46 U.S. Treasury bills and certificates6 10,053 10,652' 11,717 14,107 14,362 14,047 13,541 11,717 12,378 13,277 47 Other negotiable and readily transferable instruments7 10,207 12,765 13,924 12,154 13,033 12,408 13,266 13,924 14,152 14,961 48 Other 1,592 946 1,501 1,602 1,596 1,867 4,251 1,501 2,259 1,660 MEMO 49 Negotiable time certificates of deposit in custody for foreigners 9,111 17,567 17,885 25,293 19,115 16,793 17,397 17,885 16,442 17,137 1. Reporting banks include all types of depository institutions, as well as some brokers 6. Includes nonmarketable certificates of indebtedness and Treasury bills issued to and dealers. official institutions of foreign countries. 2. Excludes negotiable time certificates of deposit, which are included in "Other 7. Principally bankers acceptances, commercial paper, and negotiable time certificates negotiable and readily transferable instruments." of deposit. 3. Includes borrowing under repurchase agreements. 8. Principally the International Bank for Reconstruction and Development, the Inter- 4. For U.S. banks, includes amounts owed to own foreign branches and foreign American Development Bank, and the Asian Development Bank. Excludes "holdings of subsidiaries consolidated in quarterly Consolidated Reports of Condition filed with bank dollars" of the International Monetary Fund. regulatory agencies. For agencies, branches, and majority-owned subsidiaries of foreign 9. Foreign central banks, foreign central governments, and the Bank for International banks, consists principally of amounts owed to the head office or parent foreign bank, and Settlements. to foreign branches, agencies, or wholly owned subsidiaries of the head office or parent 10. Excludes central banks, which are included in "Official institutions." foreign bank. 5. Financial claims on residents of the United States, other than long-term securities, held by or through reporting banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A57 3.17 LIABILITIES TO FOREIGNERS Reported by Banks in the United States1—Continued 1994 1995 IItteemm 11999922 11999933 11999944RR Aug.' Sept. Oct. Nov. Dec.' Jan. Feb." AREA 1 Total, all foreigners 810,259 921,196" 1,008,244 999,013 999,386' 1,011,497' 988,352' 1,008,244 1,008,443 1,017,799 2 Foreign countries 800,909 910,860r 1,003,605 993,690 991,767r l,003,673r 982,145r 1,003,605 1,002,217 1,010,815 3 307,670 377,193R 389,945 420,020 406,909R 413,440' 393,156' 389,945 391,923 385,832 4 1,611 1,917 3,649 3,349 3,014 3,610 4,264 3,649 3,235 4,019 5 Belgium and Luxembourg 20,567 28,621' 21,734 27,114 27,568R 23,566' 22,322' 21,734 21,674 22,087 6 3,060 4,517 2,776 2,634 2,128 2,374 2,307 2,776 2,657 1,970 7 1,299 1,872 1,433 1,747 2,319 2,601 1,587 1,433 2,396 1,746 8 41,411 39,746R 44,706 41,910 43,143 44,209 41,160 44,706 42,320 44,253 9 18,630 26,613 27,154 31,047 31,889 33,136 31,050R 27,154 28,491 27,459 10 913 1,519 1,391 1,201 1,227 1,711 1,477 1,391 1,228 2,063 11 Italy 10,041 LL,759R 10,859 11,971 10,975R 10,893' 9,777' 10,859 10,249 11,998 1? 7,365 16,096 15,990 17,197 18,754 18,034 17,310 15,990 14,830 15,886 13 Norway 3,314 2,966 2,336 3,082 2,861 3,400 2,807 2,336 2,306 2,141 14 2,465 3,366 2,845 2,867 3,023 2,861 2,919 2,845 2,862 4,006 15 577 2,511 2,058 3,794 2,899 2,337 2,367 2,058 1,449 2,162 16 9,793 20,493 14,599 15,448 14,198 16,325' 15,038 14,599 15,113 11,101 17 2,953 2,572 3,093 4,149 4,651 3,467 3,361 3,093 2,258 2,247 18 39,440 41,561R 41,873 43,496 41,050 41,834 41,756 41,873 39,505 40,093 19 2,666 3,227 3,301 3,247 3,023' 3,143' 3,032 3,301 3,598 2,680 ?0 United Kingdom 111,805 133,936 162,444 174,074 160,154R 171,938' 162,76C 162,444 173,826 162,610 ?1 504 570 245 227 224 220 240 245 261 257 22 Other Europe and other former U.S.S.R. 29,256 33,331 27,659 31,466 33,909 27,981 27,822 27,659 23,865 27,254 23 Canada 22,420 20,227 24,609 26,343 24,660 23,115 23,295 24,609 26,498 26,563 74 317,228 358,040R 420,995 383,560 390,405' 391,132' 396,399' 420,995 411,219 421,311 75 9,477 14,477 17,183 14,818 13,783 15,577 15,950 17,183 12,766 11,879 76 82,284 73,800R 106,051 84,256 87,007' 88,668' 90,091' 106,051 99,347 101,382 ?7 7,079 7,841R 7,870 8,424 10,334 8,936 7,615 7,870 8,901 8,546 78 5,584 5,301 9,123 5,702 5,670 6,196' 6,723 9,123 8,964 10,557 ?9 British West Indies 153,033 190,445R 226,152 209,313 213,135' 209,409' 214,444' 226,152 227,148 230,897 30 Chile 3,035 3,183 3,113 2,993 3,407 3,078 3,741 3,113 2,965 3,327 31 4,580 3,171 4,604 3,726 4,027 4,475' 4,417 4,604 4,302 4,031 3? Cuba 3 33 13 11 13 7 7 13 12 5 33 993 880 875 847 823 830 825 875 1,339 1,510 34 Guatemala 1,377 1,207 1,118 1,138 1,103 1,077' 1,036 1,118 1,056 1,077 35 371 410 520 531 565 589 513 520 439 462 36 19,454 28,018 12,241 20,825 19,941' 21,263' 19,199 12,241 12,601 16,777 37 Netherlands Antilles 5,205 4,195 4,481 5,076 4,275' 4,153' 4,845' 4,481 3,838 4,488 38 4,177 3,582 4,545 3,861 4,082 4,077 4,598 4,545 4,831 4,276 39 1,080 926 897 1,027 1,079 1,027 935 897 889 887 40 1,955 1,611 1,595 1,332 1,399 1,472' 1,190 1,595 1,795 1,607 41 11,387 12,786 13,962 13,170 13,297 13,809' 13,833 13,962 13,437 12,946 42 Other 6,154 6,174 6,652 6,510 6,465' 6,489 6,437 6,652 6,589 6,657 43 143,540 144,575R 155,218 152,310 158,217' 163,316' 157,153' 155,218 159,311 165,610 China 44 People's Republic of China 3,202 4,011 10,063 4,393 5,062 5,625 8,017 10,063 1122,,990088 1155,,665588 45 Republic of China (Taiwan) 8,408 10,627R 9,787 8,723 8,853' 9,473' 10,919' 9,787 9,130 9,903 46 18,499 17,178R 17,177 18,613 18,750' 18,217' 17,552' 17,177 18,432 18,152 47 1,399 1,114 2,336 1,764 2,187 2,376 2,377 2,336 2,293 2,110 48 1,480 1,986 1,561 1,703 1,838' 1,734 1,613 1,561 1,598 1,939 49 3,773 4,435 5,151 3,437 3,204 6,607 5,066 5,151 5,470 4,952 SO 58,435 61,466 64,031 65,712 68,200' 66,152' 63,309' 64,031 61,610 62,940 51 Korea (South) 3,337 4,913 5,104 4,873 4,622 4,740 5,016 5,104 4,749 4,150 57 2,275 2,035 2,712 3,204 3,135 3,158 3,064 2,712 2,615 2,362 53 5,582 6,137 6,466 6,364 6,503 5,682 5,946' 6,466 8,216 9,906 54 Middle Eastern oil-exporting countries 21,437 15,824 15,444 15,981 17,138 17,232 17,678 15,444 16,164 14,904 55 Other 15,713 14,849R 15,386 17,543 18,725 22,320 16,596' 15,386 16,126 18,634 56 5,884 6,633 6,459 6,332 6,299' 6,389' 6,939 6,459 6,300 6,127 57 2,472 2,208 1,839 1,914 2,014 1,996 2,097 1,839 1,721 1,786 58 Morocco 76 99 93 82 72 66 67 93 74 65 59 South Africa 190 451 433 417 197 245 693 433 285 400 60 Zaire 19 12 9 8 9 9 10 9 10 10 61 Oil-exporting countries14 1,346 1,303 1,343 1,156 1,186 1,176 1,227 1,343 1,409 1,122 62 Other 1,781 2,560 2,742 2,755 2,821' 2,897' 2,845 2,742 2,801 2,744 63 4,167 4,192 6,379 5,125 5,277 6,281 5,203 6,379 6,966 5,372 64 3,043 33,,330088 5,141 3,935 3,966 5,114 4,094 5,141 5,395 4,349 65 Other 1,124 888844 1,238 1,190 1,311 1,167 1,109 1,238 1,571 1,023 66 Nonmonetary international and regional organizations.... 9,350 10,936 4,639 5,323 7,619' 7,824' 6,207 4,639 6,226 6,984 67 7,434 6,851 3,632 3,998 5,39^ 5,844' 4,358' 3,632 4,860 5,761 68 Latin American regional16 1,415 3,218 551 418 1,108' 950 1,094 551 865 652 69 Other regional 501 867 456 907 1,121' 1,030' 755' 456 501 571 11. Since December 1992, has excluded Bosnia, Croatia, and Slovenia. 14. Comprises Algeria, Gabon, Libya, and Nigeria. 12. Includes the Bank for International Settlements. Since December 1992, has 15. Principally the International Bank for Reconstruction and Development. Excludes included all parts of the former U.S.S.R. (except Russia), and Bosnia, Croatia, and "holdings of dollars" of the International Monetary Fund. Slovenia. 16. Principally the Inter-American Development Bank. 13. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United 17. Asian, African, Middle Eastern, and European regional organizations, except the Arab Emirates (Trucial States). Bank for International Settlements, which is included in "Other Europe." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 International Statistics • June 1995 3.18 BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States' Payable in U.S. Dollars Millions of dollars, end of period 1994' 1995 AArreeaa oorr ccoouunnttrryy 11999922 11999933 11999944'' Aug. Sept. Oct. Nov. Dec. Jan. Feb.p 1 Total, all foreigners 499,437 484,584' 477,473 478,944 475,742 479,426 464,360 477,473 479,674 474,420 2 Foreign countries 494,355 482,179r 473,350 476,985 472,478 477,421 463,026 473,350 476,710 473,672 3 Europe 123,377 121,550r 122,918 124,895 120,550 131,985 120,045 122,918 125,188 122,884 4 Austria 331 413 705 477 293 440 369 705 350 425 5 Belgium and Luxembourg 6,404 6,535 6,651 6,574 7,279 6,370 6,274 6,651 5,558 4,833 6 Denmark 707 382 1,039 464 521 880 668 1,039 488 646 7 Finland 1,418 594 696 502 594 587 718 696 721 456 8 France 14,723 11,519r 12,158 16,009 14,846 16,354 12,906 12,158 12,615 11,959 9 Germany 4,222 7,703r 6,638 9,996 8,655 8,501 8,452 6,638 8,530 7,639 10 Greece 717 679 592 657 613 520 518 592 668 751 11 Italy 9,047 8,918r 6,143 5,578 5,376 6,693 5,950 6,143 6,820 6,963 12 Netherlands 2,468 3,073r 2,957 3,196 2,908 3,402 3,426 2,957 2,943 4,200 13 Norway 355 396 504 825 650 903 1,004 504 1,069 988 14 Portugal 325 834 938 1,040 1,182 1,056 1,006 938 988 1,045 15 Russia 3,147 2,310 949 1,378 1,272 1,220 1,172 949 1,148 759 16 Spain 2,755 2,766 3,552 2,664 2,211 2,731 2,174 3,552 2,989 2,803 17 Sweden 4,923 4,086' 4,111 4,168 3,903 3,156 3,596 4,111 3,837 4,049 18 Switzerland 4,717 6,566' 7,491 6,937 5,853 7,670 6,544 7,491 9,025 8,060 19 Turkey 962 1,294' 862 1,159 1,046 1,147 914 862 548 869 20 United Kingdom 63,430 61,169' 65,502 61,531 61,084 68,512 62,616 65,502 64,885 64,628 21 Yugoslavia^. 569 536 265 273 258 266 266 265 265 265 22 Other Europe and other former U.S.S.R.3 2,157 1,777 1,165 1,467 2,006 1,577 1,472 1,165 1,741 1,546 23 Canada 13,845 18,432' 17,978 19,732 19,239 16,433 17,788 17,978 18,812 18,907 24 Latin America and Caribbean 218,078 223,649' 219,535 222,933 219,772 221,055 215,948 219,535 220,585 219,298 25 Argentina 4,958 4,422' 5,781 5,877 5,587 5,588 5,718 5,781 5,837 6,309 26 Bahamas 60,835 64,410' 65,951 62,685 62,351 64,841 60,786 65,951 63,996 63,787 27 Bermuda 5,935 8,034 7,484 7,347 5,444 5,199 6,710 7,484 14,551 10,905 28 Brazil 10,773 11,812 9,452 10,083 10,299 10,216 9,784 9,452 9,734 9,992 29 British West Indies 101,507 98,149' 94,264 100,634 100,840 99,311 95,922 94,264 90,156 91,284 30 Chile 3,397 3,616 3,787 3,418 3,401 3,431 3,628 3,787 3,866 4,190 31 Colombia 2,750 3,179 4,003 3,414 3,463 3,671 3,768 4,003 3,816 3,813 32 Cuba 0 0 0 0 0 12 0 0 0 0 33 Ecuador 884 680 685 604 625 628 635 685 712 668 34 Guatemala 262 286 366 320 310 337 335 366 346 349 35 Jamaica 162 195 254 210 204 255 251 254 253 278 36 Mexico 14,991 15,834' 17,517 16,556 16,329 16,954 17,406 17,517 17,303 17,270 37 Netherlands Antilles 1,379 2,411' 1,055 2,176 1,332 1,195 1,818 1,055 1,205 1,437 38 Panama 4,654 2,892 2,179 2,386 2,384 2,307 2,304 2,179 2,155 2,340 39 Peru 730 653 959 924 946 857 884 959 998 1,055 40 Uruguay 936 952 485 706 711 800 652 485 420 390 41 Venezuela 2,525 2,907 1,830 2,146 2,055 1,934 1,921 1,830 1,716 1,736 42 Other 1,400 3,217 3,483 3,447 3,491 3,519 3,426 3,483 3,521 3,495 43 Asia 131,789 111,787' 106,719 102,778 106,261 101,412 103,346 106,719 105,318 106,476 China 44 People's Republic of China 906 2,299 835 764 1,177 822 817 835 923 859 45 Republic of China (Taiwan) 2,046 2,628 1,381 1,805 1,258 1,464 1,479 1,381 1,245 1,213 46 Hong Kong 9,642 10,881' 9,272 9,896 13,057 10,362 11,336 9,272 10,305 11,322 47 India 529 589 986 829 972 971 1,021 986 1,099 1,055 48 Indonesia 1,189 1,527' 1,454 1,365 1,371 1,328 1,366 1,454 1,478 1,416 49 Israel 820 826 691 675 663 863 696 691 673 684 50 Japan 79,172 59,945' 59,161 52,968 53,145 50,140 53,550 59,161 55,253 57,184 51 Korea (South) 6,179 7,569 9,998 8,553 8,932 9,048 8,933 9,998 10,582 10,512 52 Philippines 2,145 1,408 636 533 562 639 583 636 564 548 53 Thailand 1,867 2,154 2,818 2,784 2,698 2,756 2,676 2,818 2,795 2,562 54 Middle Eastern oil-exporting countries4 18,540 15, llC 13,732 16,081 15,302 15,425 14,454 13,732 14,044 13,341 55 Other 8,754 6,851' 5,755 6,525 7,124 7,594 6,435 5,755 6,357 5,780 56 Africa 4,279 3,867' 3,033 3,689 3,526 3,177 3,115 3,033 2,966 2,928 57 Egypt 186 196 225 229 254 237 229 225 227 234 58 Morocco 441 481 429 485 497 468 480 429 415 442 59 South Africa 1,041 633 665 656 569 480 454 665 657 597 60 Zaire 4 4 2 3 3 3 3 2 2 2 61 Oil-exporting countries5 1,002 1,139' 872 1,219 1,133 985 909 872 854 801 62 Other 1,605 1,414 840 1,097 1,070 1,004 1,040 840 811 852 63 Other 2,987 2,894' 3,167 2,958 3,130 3,359 2,784 3,167 3,841 3,179 64 Australia 2,243 2,071' 2,224 1,390 1,810 2,158 1,687 2,224 2,203 1,917 65 Other 744 823' 943 1,568 1,320 1,201 1,097 943 1,638 1,262 66 Nonmonetary international and regional organizations6... 5,082 2,405 4,123 1,959 3,264 2,005 1,334 4,123 2,964 748 1. Reporting banks include all types of depository institutions, as well as some brokers 4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab and dealers. Emirates (Trucial States). 2. Since December 1992, has excluded Bosnia, Croatia, and Slovenia. 5. Comprises Algeria, Gabon, Libya, and Nigeria. 3. Includes the Bank for International Settlements. Since December 1992, has included 6. Excludes the Bank for International Settlements, which is included in "Other all parts of the former U.S.S.R. (except Russia), and Bosnia, Croatia, and Slovenia. Europe." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A59 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 1994r 1995 TTyyppee ooff ccllaaiimm Aug. Sept. Oct. Nov. Dec. Jan. Feb.p 1 Total 559,495 535,393 548,611 530,308 548,611 2 Banks' claims 499,437 484,584 477,473 478,944 475,742 479,426 464,360 477,473 479,674 474,420 3 Foreign public borrowers 31,367 29,115 22,938 22,687 24,741 22,373 20,649 22,938 22,964 17,721 4 Own foreign offices2 303,991 286,382 281,839 286,374 282,657 286,539 276,040 281,839 278,316 279,160 5 Unaffiliated foreign banks 109,342 98,433 109,554 102,684 101,174 107,035 103,639 109,554 104,122 105,234 6 Deposits 61,550 47,167 58,354 49,952 50,900 52,914 50,490 58,354 53,900 53,808 7 Other 47,792 51,266 51,200 52,732 50,274 54,121 53,149 51,200 50,222 51,426 8 All other foreigners 54,737 70,654 63,142 67,199 67,170 63,479 64,032 63,142 74,272 72,305 9 Claims of banks' domestic customers3 60,058 50,809 71,138 54,566 71,138 10 Deposits 15,452 20,241 35,502 25,087 35,502 11 Negotiable and readily transferable instruments4 31,474 16,885 22,328 16,263 22,328 12 Outstanding collections and other claims 13,132 13,683 13,308 13,216 13,308 MEMO 13 Customer liability on acceptances 8,655 7,863 8,316 7,614 8,316 14 Dollar deposits in banks abroad, reported by nonbanking business enterprises in the United States5 38,623 26,370 27,382 23,241 24,876 23,337 27,912 27,382 n.a. n.a. 1. For banks' claims, data are monthly; for claims of banks' domestic customers, data and to foreign branches, agencies, or wholly owned subsidiaries of the head office are for quarter ending with month indicated. parent foreign bank. Reporting banks include all types of depository institution, as well as some brokers and 3. Assets held by reporting banks in the accounts of their domestic customers. dealers. 4. Principally negotiable time certificates of deposit and bankers acceptances. 2. For U.S. banks, includes amounts due from own foreign branches and foreign 5. Includes demand and time deposits and negotiable and nonnegotiable certificates subsidiaries consolidated in quarterly Consolidated Reports of Condition filed with bank deposit denominated in U.S. dollars issued by banks abroad. For description of changes regulatory agencies. For agencies, branches, and majority-owned subsidiaries of foreign data reported by nonbanks, see Federal Reserve Bulletin, vol. 65 (July 1979), p. 550. banks, consists principally of amounts due from the head office or parent foreign bank, 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 1994r MMaattuurriittyy,, bbyy bboorrrroowweerr aanndd aarreeaa22 11999911 11999922 11999933rr Mar. June Sept. Dec. 1 Total 195,302 195,119 196,552 194,581 186,711 191,770 194,628 By borrower 2 Maturity of one year or less 162,573 163,325 167,919 168,028 161,594 166,244 169,708 3 Foreign public borrowers 21,050 17,813 17,773 16,150 12,951 16,986 14,968 4 All other foreigners 141,523 145,512 150,146 151,878 148,643 149,258 154,740 5 Maturity of more than one year 32,729 31,794 28,633 26,553 25,117 25,526 24,920 6 Foreign public borrowers 15,859 13,266 10,821 9,229 8,051 7,375 7,675 7 All other foreigners 16,870 18,528 17,812 17,324 17,066 18,151 17,245 By area Maturity of one year or less 8 Europe 51,835 53,300 56,605 59,209 51,204 58,406 56,344 9 Canada 6,444 6,091 7,564 7,306 8,285 7,217 7,251 10 Latin America and Caribbean 43,597 50,376 56,755 58,998 56,758 57,034 58,859 11 Asia 51,059 45,709 41,382 36,875 38,891 36,766 40,043 12 Africa 2,549 1,784 1,820 1,613 1,798 1,519 1,364 13 All other3 7,089 6,065 3,793 4,027 4,658 5,302 5,847 Maturity of more than one year 14 Europe 3,878 5,367 4,428 3,842 3,355 3,637 3,641 15 Canada 3,595 3,287 2,553 2,548 2,451 2,607 2,373 16 Latin America and Caribbean 18,277 15,312 13,866 13,009 12,420 12,146 11,958 17 Asia 4,459 5,038 5,402 4,704 4,607 4,838 4,583 18 Africa 2,335 2,380 1,936 2,001 1,849 1,836 1,549 19 AH other3 185 410 448 449 435 462 816 1. Reporting banks include all kinds of depository institutions besides commercial 2. Maturity is time remaining to maturity, 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

A60 International Statistics • June 1995 3.21 CLAIMS ON FOREIGN COUNTRIES Held by U.S. and Foreign Offices of U.S. Banks1 Billions of dollars, end of period 1992 1993 1994 AArreeaa oorr ccoouunnttrryy 11999900 11999911 Dec. Mar. June Sept. Dec. Mar. June Sept. Dec. 1 Total 320.1 343.6 346.5 361.1 377.1 388.4 404.7r 490.0r 500.6r 504.7r 506.6r 2 G-10 countries and Switzerland 132.2 137.6 132.9 142.5 150.0 153.3 161.6r 178.6r 172.5r 186.0r 187.6r 3 Belgium and Luxembourg .0 6.0 5.6 6.1 7.0 7.1 7.4 8.1 8.8 9.7 7.0 4 France 10.4 11.0 15.3 13.5 14.0 12.3 11.7 16.4 18.8 20.7 19.1 5 Germany 10.6 8.3 9.3 9.9 10.8 12.4 12.6 28.7 24.4 23.5 24.4 6 Italy 5.0 5.6 6.5 6.7 7.9 8.7 7.7 15.5 14.0 11.6 11.8 7 Netherlands .0 4.7 2.8 3.6 3.7 3.7 4.7 4.1 3.6 3.5r 3.6r 8 Sweden 2.2 1.9 2.3 3.0 2.5 2.5 2.5 2.8 2.9 2.6 2.7 9 Switzerland 4.4 3.4 4.8 5.3 4.7 5.6 5.9 6.3 6.5 6.2 6.9 10 United Kingdom 60.9 68.5 60.8 65.7 73.5 74.7 84.7r 70. lr 63.4r 82.r 81.8 11 Canada 5.9 5.8 6.3 8.2 8.0 9.7 6.7 7.7r 9.6r 9.8 9.5 12 Japan 24.0 22.6 19.3 20.4 17.9 16.8 17.8r 18.9r 20.5r 16.4r 20.7r 13 Other industrialized countries 22.9 22.8 24.0 25.4 27.2 26.0 24.6 41.2 41.7r 41.5 44.2r 14 Austria 1.4 .6 1.2 1.2 1.3 .6 .4 1.0 1.0 1.0 1.1 15 Denmark 1.1 .9 .9 .8 1.0 1.1 1.0 1.1 1.1 .8 1.2 16 Finland .7 .7 .7 .7 .9 .6 .4 1.0 .8 .8 1.0 17 Greece 2.7 2.6 3.0 2.7 3.1 3.2 3.2 3.8 4.6 4.3 4.5 18 Norway 1.6 1.4 1.2 1.8 1.8 2.1 1.7 1.6 1.6 1.6 2.0 19 Portugal .6 .6 .4 .7 .9 1.0 .8 1.2 1.1 1.0 1.2 20 Spain 8.3 8.3 8.9 9.5 10.5 9.3 8.9 12.3 11.7 13.1 13.6 21 Turkey 1.7 1.4 1.3 1.4 2.1 2.1 2.1 2.4 2.1 1.8 1.6 22 Other Western Europe 1.2 1.8 1.7 2.0 1.7 2.2 2.6 3.0 2.8 1.0 2.7 23 South Africa 1.8 1.9 1.7 1.6 1.3 1.2 1.1 1.2 1.2 1.2 1.0 24 Australia 1.8 2.7 2.9 2.9 2.5 2.8 2.3 12.7 13.7 15.0 14.3r 25 OPEC2 12.8 14.5 16.1 16.6 15.7 14.8 17.4r 22.9r 21.5 21.6r 22.1 26 Ecuador 1.0 .7 .6 .6 .6 .5 .5 .5 .5 .4 .5 27 Venezuela 5.0 5.4 5.2 5.1 5.5 5.4 5.1 4.7 4.4 3.9 3.7 28 Indonesia 2.7 2.7 3.0 3.1 3.1 2.8 3.3r 3.4 3.2 3.3r 3.6 29 Middle East countries 2.5 4.2 6.2 6.6 5.4 4.9 7.4r 13.2r 12.4 13.0 13.4 30 African countries 1.7 1.5 1.1 1.1 1.1 1.1 1.2 1.1 1.1 1.0 .9 31 Non-OPEC developing countries 65.4 63.9 72.1 74.4 76.7 77.0 82.6 93.6r 94. lr 92.3r 94.9 Latin America 32 Argentina 5.0 4.8 6.6 7.1 6.6 7.2 7.7 8.7 9.8 10.5 11.1 33 Brazil 14.4 9.6 10.8 11.6 12.3 11.7 12.0 12.6r 11.9r 9.2r 8.2 34 Chile 3.5 3.6 4.4 4.6 4.6 4.7 4.7 5.1 5.1 5.4 6.1 35 Colombia 1.8 1.7 1.8 1.9 1.9 2.0 2.1 2.2 2.4 2.4 2.6 36 Mexico 13.0 15.5 16.0 16.8 16.8 17.5 17.7 18.8r 18.5r 19.6r 18.1 37 Peru .5 .4 .5 .4 .4 .3 .4 .5 .6 .6 .5 38 Other 2.3 2.1 2.6 2.7 2.7 2.7 3.0 2.7 2.7 2.7 2.5 Asia China 39 Peoples Republic of China .2 .3 .7 .6 1.6 .5 2.0 .8 .7 1.0 1.1 40 Republic of China (Taiwan) 3.5 4.1 5.2 5.3 5.9 6.4 7.3 7.5 7.1 6.9 9.1 41 India 3.3 3.0 3.2 3.1 3.1 2.9 3.2 3.6 3.7 3.9 4.2 42 Israel .5 .5 .4 .5 .4 .4 .5 .4 .4 .4 .4 43 Korea (South) 6.2 6.8 6.6 6.5 6.9 6.5 6.7 13.9 14.1 14.1r 14.1 44 Malaysia 1.9 2.3 3.1 3.4 3.7 4.1 4.4 5.2 5.2 3.9 3.3 45 Philippines 3.8 3.7 3.6 3.4 2.9 2.6 3.1 3.4 3.2 2.9 3.3 46 Thailand 1.5 1.7 2.2 2.2 2.4 2.8 3.1 2.9 3.3 3.5r 3.7 47 Other Asia 1.7 2.0 2.7 2.7 2.6 3.0 2.9 3.1 3.5 3.6 4.8 Africa 48 Egypt .4 .4 .2 .2 .2 .2 .4 .4 .5 .3 .3 49 Morocco .8 .7 .6 .5 .6 .6 .7 .7 .7 .7 .6 50 Zaire .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 51 Other Africa3 1.0 .7 1.0 .8 .9 .8 .8 1.0 .9 .9 .8 52 Eastern Europe 2.3 2.4 3.1 2.9 3.2 3.0 3.1 3.4 3.0 3.0 2.6 53 Russia4 .2 .9 1.9 1.7 1.9 1.7 1.6 1.5 1.2 1.1 .8 54 Yugoslavia5 1.2 .9 .6 .6 .6 .6 .6 .5 .5 .5 .5 55 Other .9 .7 .6 .7 .8 .7 .9 1.4 1.4 1.5 1.3 56 Offshore banking centers 44.7 54.2 58.3 60.3 58.0 67.9 71.9r 78.0r 76.4r 74.6r 68.2r 57 Bahamas 2.9 11.9 6.9 9.7 7.1 12.7 11.9r 14.8r 13.lr 13.2r 9.7r 58 Bermuda 4.4 2.3 6.2 4.1 4.5 5.5 8.1 8.4 6.1 5.3 7.4r 59 Cayman Islands and other British West Indies 11.7 15.8 21.8 17.6 15.6 15.1 17.0 17.1r 20.3r 20.2r 18.7 60 Netherlands Antilles 7.9 1.2 1.1 1.6 2.5 2.8 2.3 2.8r 2.5r 1.7 l.C 61 Panama6 1.4 1.4 1.9 2.0 2.1 2.1 2.4 2.0 1.9 1.9r 1.5 62 Lebanon .1 .1 .1 .1 .1 .1 .1 .1 .1 .1 .1 63 Hong Kong 9.7 14.4 13.8 16.7 16.9 19.1 18.7 19.7 21.7r 20.3 19.9r 64 Singapore 6.6 7.1 6.5 8.4 9.3 10.4 11.2 13.1r 10.7r 11.8 10.0 65 Other' .0 .0 .0 .0 .0 .0 .1 .0 .0 .0 .1 66 Miscellaneous and unallocated8 39.9 48.0 39.7 38.8 46.2 46.3 43.4r 72. lr 91. lr 85.4 86.7 1. The banking offices covered by these data include U.S. offices and foreign branches by the Federal Financial Institutions Examination Council. of U.S. banks, including U.S. banks that are subsidiaries of foreign banks. Offices not 2. Organization of Petroleum Exporting Countries, shown individually; other members covered include U.S. agencies and branches of foreign banks. Beginning March 1994, the of OPEC (Algeria, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, and data include large foreign subsidiaries of U.S. banks. The data also include other types of United Arab Emirates); and Bahrain and Oman (not formally members of OPEC). U.S. depository institutions as well as some types of brokers and dealers. To eliminate 3. Excludes Liberia. Beginning March 1994 includes Namibia. duplication, the data are adjusted to exclude the claims on foreign branches held by a U.S. 4. As of December 1992, excludes other republics of the former Soviet Union. office or another foreign branch of the same banking institution. 5. As of December 1992, excludes Croatia, Bosnia and Hercegovinia, and Slovenia. These data are on a gross claims basis and do not necessarily reflect the ultimate 6. Includes Canal Zone. country risk or exposure of U.S. banks. More complete data on the country risk exposure 7. Foreign branch claims only. of U.S. banks are available in the quarterly Country Exposure Lending Survey published 8. Includes New Zealand, Liberia, and international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A61 3.22 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1993 1994 Type of liability, and area or country 11999911 11999922 11999933 Sept. Dec. Mar. Juner Sept. Dec.p 1 Total 44,708 45,511r 49,996 48,954r 49,996r 51,988r 55,478 57,197r 54,174 2 Payable in dollars 39,029 37,456r 38,758 39,71 lr 38,758r 38,549r 43,114 42,754r 39,322 3 Payable in foreign currencies 5,679 8,055 11,238 9,243 ll,238r 13,439 12,364 14,443r 14,852 By type 4 Financial liabilities 22,518 23,841r 28,586 27,172r 28,586r 30,344r 33,340 35,843r 32,391 5 Payable in dollars 18,104 16,960r 18,553 19,146r 18,553' 18,929r 22,976 23,282' 19,427 6 Payable in foreign currencies 4,414 6,881 10,033 8,026 10,033r ll,415r 10,364 12,561r 12,964 7 Commercial liabilities 22,190 21,670 21,410 21,782 21,410r 21,644r 22,138 21,354r 21,783 8 Trade payables 9,252 9,566 8,811 9,215 8,81 lr 8,974r 9,913 9,552r 10,001 9 Advance receipts and other liabilities ... 12,938 12,104 12,599 12,567 12,599r 12,670r 12,225 ll,802r 11,782 10 Payable in dollars 20,925 20,496 20,205 20,565 20,205r 19,620r 20,138 19,472r 19,895 11 Payable in foreign currencies 1,265 1,174 1,205 1,217 1,205 2,024 2,000 1,882 1,888 By area or country Financial liabilities 12 Europe 12,003 13,387r 18,437 16,886r 18,437r 20,442r 23,627 23,765r 20,852 13 Belgium and Luxembourg 216 414 175 278 175 525 524 661r 495 14 France 2,106 11,,662233 2,377 2,077 2,377r 2,606r 1,590 2,241 1,727 15 Germany 682 888899 975 855 975 1,214 939 1,467 1,953 16 Netherlands 1,056 606 534 573 534 564 533 648 552 17 Switzerland 408 569 634 378 634 1,200 631 633 688 18 United Kingdom 6,528 8,610r 13,121 12,135r 13,121r 13,725r 18,193 16,800r 14,709 19 Canada 292 544 859 663 859 508 698 618 625 20 Latin America and Caribbean 4,784 4,053 3,359 3,719 3,359 3,553 3,282 3,159 3,201 21 Bahamas 537 379 1,148 1,301 1,148 1,157 1,052 1,112 926 22 Bermuda 114 114 0 114 0 120 115 15 80 23 Brazil 6 19 18 18 18 18 18 7 207 24 British West Indies 3,524 2,850 1,533 1,600 1,533 1,613 1,454 1,364 1,340 25 Mexico 7 12 17 15 17 14 13 15 0 26 Venezuela 4 6 5 5 5 5 5 5 5 27 Asia2 5,381 5,818 5,689 5,754 5,689 5,650r 5,694 8,149r 7,528 28 Japan 4,116 4,750 4,620 4,725 4,620 4,638r 4,760 6,947r 6,414 29 Middle Eastern oil-exporting countries' 13 19 23 23 23 24 24 31 35 30 Africa 6 6 133 132 133 133 9 133 135 4 0 123 124 123 124 0 123 123 31 Oil-exporting countries4 52 33 109 18 109r 58r 30 19 50 32 All other5 Commercial liabilities 8,701 7,398 6,835 7,048 6,835r 6,550r 6,921 6,867r 6,853 33 Europe 248 298 239 257 239 251r 254 287 231 34 Belgium and Luxembourg 1,039 700 655 642 655r 554r 712 742 762 35 France 1,052 729 684 571 684 577 670 552 611 36 Germany 710 535 688 600 688 628 649 674 723 37 Netherlands 575 350 375 536 375 388r 473 391 335 38 Switzerland 2,297 2,505 2,047 2,319 2,047r 2,151r 2,311 2,351r 2,442 39 United Kingdom 40 Canada 1,014 1,002 879 845 879r 1,037 1,070 l,068r 1,038 41 Latin America and Caribbean 1,355 1,533 1,666 1,754 l,666r 1,908 2,007 1,790r 1,854 42 Bahamas 3 3 21 4 21 8 2 6 19 43 Bermuda 310 307 350 340 350r 493 418 200 345 44 Brazil 219 209 216 214 216 211 217 148 163 45 British West Indies 107 33 27 35 27r 20r 24 33 23 46 Mexico 307 457 483 576 483 556 705 673r 576 47 Venezuela 94 142 126 173 126 150 194 192 280 48 Asia2 9,334 10,594 10,992 10,915 10,992r 10,939r 10,979 10,514r 11,077 49 Japan 3,721 3,612 4,314 3,726 4,314r 4,617' 4,389 4,235r 4,808 50 Middle Eastern oil-exporting countries' 1,498 1,889 1,542 1,968 l,542r 1,542r 1,841 l,688r 1,610 51 Africa 715 568 464 641 464 490 523 482 442 52 Oil-exporting countries4 327 309 171 320 171 199 247 271 262 53 Other5 1,071 575 574 579 574r 720r 638 633r 519 1. For a description of the changes in the international statistics tables, see Federal 3. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Reserve Bulletin, vol. 65, (July 1979), p. 550. Emirates (Trucial States). 2. Revisions include a reclassification of transactions, which also affects the totals for 4. Comprises Algeria, Gabon, Libya, and Nigeria. Asia and the grand totals. 5. Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 International Statistics • June 1995 3.23 CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States1 Millions of dollars, end of period 1993 1994r TTyyppee ooff ccllaaiimm,, aanndd aarreeaa oorr ccoouunnttrryy 11999911 11999922 11999933 Sept. Dec/ Mar. June Sept. Dec.p 1 Total 45,262 45,073 47,643 46,030r 47,643 48,404 47,925 49,830 55,321 2 Payable in dollars 42,564 42,281 44,318 42,342r 44,318 44,978 44,324 46,284 52,147 3 Payable in foreign currencies 2,698 2,792 3,325 3,688 3,325 3,426 3,601 3,546 3,174 By type 4 Financial claims 27,882 26,509 26,995 26,902 26,995 27,814 26,576 28,214 32,319 5 Deposits 20,080 17,695 15,795 14,509r 15,795 15,864 15,637 17,510 19,056 6 Payable in dollars 19,080 16,872 15,246 13,503 15,246 15,353 15,009 16,934 18,595 7 Payable in foreign currencies 1,000 823 549 l,006r 549 511 628 576 461 8 Other financial claims 7,802 8,814 11,200 12,393r 11,200 11,950 10,939 10,704 13,263 9 Payable in dollars 6,910 7,890 9,974 11,282 9,974 10,725 9,711 9,466 12,181 10 Payable in foreign currencies 892 924 1,226 l,lllr 1,226 1,225 1,228 1,238 1,082 11 Commercial claims 17,380 18,564 20,648 19,128r 20,648 20,590 21,349 21,616 23,002 12 Trade receivables 14,468 16,007 17,647 16,150r 17,647 17,697 18,530 18,836 20,137 13 Advance payments and other claims 2,912 2,557 3,001 2,978 3,001 2,893 2,819 2,780 2,865 14 Payable in dollars 16,574 17,519 19,098 17,557r 19,098 18,900 19,604 19,884 21,371 15 Payable in foreign currencies 806 1,045 1,550 1,571 1,550 1,690 1,745 1,732 1,631 By area or country Financial claims 16 Europe 13,441 9,331 7,187 8,376 7,187 7,118 6,564 8,060 7,684 17 Belgium and Luxembourg 13 8 134 70 134 125 83 114 86 18 France 269 764 785 708 785 753 859 825 782 19 Germany 283 326 526 362 526 466 459 413 540 20 Netherlands 334 515 502 485 502 503 472 503 429 21 Switzerland 581 490 515 512 515 520 495 747 523 22 United Kingdom 11,534 6,252 3,543 5,230 3,543 3,629 3,089 4,370 4,469 23 Canada 2,642 1,833 2,024 2,103 2,024 2,198 3,062 3,156 3,785 24 Latin America and Caribbean 10,717 13,893 15,639 12,965 15,639 15,497 14,279 14,363 18,320 25 Bahamas 827 778 1,006 980 1,006 1,157 1,193 1,006 2,235 26 Bermuda 8 40 125 197 125 34 39 52 27 27 Brazil 351 686 654 590 654 672 466 411 520 28 British West Indies 9,056 11,747 12,448 10,000 12,448 12,371 11,578 11,772 14,504 29 Mexico 212 445 868 882 868 850 614 655 605 30 Venezuela 40 29 161 25 161 26 33 32 35 31 Asia 640 864 1,591 2,754 1,591 2,522 2,210 2,152 1,813 32 Japan 350 668 853 2,213 853 1,655 1,349 662 909 33 Middle Eastern oil-exporting countries2 5 3 3 5 3 5 2 19 141 34 Africa 57 83 99 88 99 76 74 87 249 35 Oil-exporting countries3 1 9 1 1 1 0 1 1 0 36 All other4 385 505 455 616 455 403 387 396 468 Commercial claims 37 Europe 8,193 8,451 9,077 8,21 lr 9,077 8,734 8,904 8,768 9,557 38 Belgium and Luxembourg 194 189 184 163 184 176 179 174 216 39 France 1,585 1,537 1,947 1,438 1,947 1,827 1,778 1,766 1,885 40 Germany 955 933 1,018 935 1,018 944 937 880 1,046 41 Netherlands 645 552 422 410 422 354 293 329 313 42 Switzerland 295 362 429 377r 429 413 685 537 558 43 United Kingdom 2,086 2,094 2,369 2,288r 2,369 2,330 2,427 2,483 2,515 44 Canada 1,121 1,286 1,358 l,362r 1,358 1,451 1,466 1,501 1,548 45 Latin America and Caribbean 2,655 3,043 3,283 3,073r 3,283 3,569 3,901 3,965 4,130 46 Bahamas 13 28 11 20 11 13 18 34 9 47 Bermuda 264 255 182 225 182 222 295 246 234 48 Brazil 427 357 463 407 463 422 502 473 614 49 British West Indies 41 40 71 39 71 58 67 49 83 50 Mexico 842 924 994 866 994 1,013 1,047 1,133 1,241 51 Venezuela 203 345 295 287r 295 294 303 392 353 52 Asia 4,591 4,866 5,909 5,544r 5,909 5,852 6,145 6,425 6,724 53 Japan 1,899 1,903 2,173 2,519 2,173 2,353 2,359 2,448 2,496 54 Middle Eastern oil-exporting countries2 620 693 715 458r 715 667 615 615 698 55 Africa 430 554 521 501r 521 516 492 462 461 56 Oil-exporting countries3 95 78 85 107 85 102 90 68 76 57 Other4 390 364 500 437 500 468 441 495 582 1. For a description of the changes in the international statistics tables, see Federal 3. Comprises Algeria, Gabon, Libya, and Nigeria. Reserve Bulletin, vol. 65 (July 1979), 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 A63 3.24 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1995 1994 1995 Transaction, and area or country 1993 1994r J F a e n b . . - Aug.r Sept. Oct. Nov. Dec. Jan. Feb.p U.S. corporate securities STOCKS 1 Foreign purchases 319,728 351,422 54,427 29,314 28,853r 27,796r 28,730 28,224 24,999 29,428 2 Foreign sales 298,145 349,737 55,578 26,401 30,435r 29,845r 27,658 30,161 25,893 29,685 3 Net purchases, or sales (—) 21,583 1,685 -1,151 2,913 -1,582 —2,049r 1,072 -1,937 -894 -257 4 Foreign countries 21,311 1,675 -1,142 2,915 -1,596 —2,081r 1,049 -1,939 -930 -212 5 Europe 10,665 6,190 -541 1,425 -1,198 — l,396r 216 -1,445 -516 -25 6 France -103 -202 -282 -22 -63 -198 -25 -117 -255 -27 7 Germany 1,647 2,112 -212 73 -104 -158 -57 -159 -157 -55 8 Netherlands -600 1,812 510 266 -134 316 264 211 278 232 9 Switzerland 2,986 -44 -467 136 -104 -655 -555 10 -389 -78 10 United Kingdom 4,560 664 187 867 -641 -559r 565 -1,256 253 -66 11 Canada -3,213 -1,198 156 -366 57 -416 -116 157 129 27 1? Latin America and Caribbean 5,724 -1,794 1,757 989 -625 -516 673 -553 991 766 13 Middle East1 -328 -1,112 -155 -281 -431 -75 1 -85 -22 -133 14 Other Asia 8,198 -1,193 -2,320 1,031 589 335 273 -149 -1,469 -851 15 Japan 3,825 1,203 -1,401 1,132 761 251 272 -171 -860 -541 16 Africa 63 30 -36 0 10 12 -4 -25 -36 0 17 Other countries 202 752 -3 117 2 -25 6 161 -7 4 18 Nonmonetary international and regional organizations 272 10 -9 -2 14 32 23 2 36 -45 BONDS2 19 Foreign purchases 283,946 288,804 42,171 22,963 18,981r 19,703r 22,213r 18,897r 19,267 22,904 20 Foreign sales 217,932 227,399 29,204 15,659 17,020r 16,173r 15,306 14,719 12,800 16,404 21 Net purchases, or sales (-) 66,014 61,405 12,967 7,304 l,961r 3,530r 6,907r 4,178r 6,467 6,500 22 Foreign countries 65,476 60,520 12,817 7,371 l,994r 3,531r 6,923r 3,838r 6,263 6,554 7.3 Europe 22,586 38,506 12,705 5,178 2,876r 3,294r 4,445r 2,583r 6,653 6,052 74 France 2,346 243 453 -18 -16 105 -106 4 157 296 7.5 Germany 885 629 2,042 34 -355 449 200 451 1,516 526 7.6 Netherlands -290 3,220 -115 610 246r 17r 344 28 -241 126 7.7 Switzerland -627 1,054 219 -8 292 4 489 13 -85 304 7.8 United Kingdom 19,686 33,304 10,221 4,522 2,197r 1,476r 3,587 1,916 5,406 4,815 79 Canada 1,668 3,063 420 519 194 460 201 462 245 175 30 Latin America and Caribbean 15,697 5,362 -1,135 -80 -1,852 -981 1,290 694 -655 -480 31 Middle East1 3,257 750 228 157 -76 56 -86 -176 59 169 37 Other Asia 20,846 12,108 567 1,558 807r 627r 1,079 251 -28 595 33 Japan 11,569 5,536 -264 763 340 375 445 -172 -396 132 34 Africa 1,149 44 4 18 2 20 -4 8 8 -4 35 Other countries 273 687 28 21 43 55 -2 16 -19 47 36 Nonmonetary international and regional organizations 538 885 150 -67 —33r -1 -16 334400 204 -54 Foreign securities 37 Stocks, net purchases, or sales ( —) -63,287 -48,419 -1,744 -4,618 515r —4,504r -2,556r —2,179r -210 -1,534 38 Foreign purchases 245,561 379,730 57,121 30,425 37,267r 29,845r 28,263 25,668 27,948 29,173 39 Foreign sales3 308,848 428,149 58,865 35,043 36,752r 34,349r 30,819r 27,847r 28,158 30,707 40 Bonds, net purchases, or sales (-) -70,136 -6,670 -1,252 956 -534r —5,083r —2,198r l,048r 1,261 -2,513 41 Foreign purchases 828,922 863,458 137,240 64,076 75,386r 66,415r 66,876r 68,792r 71,948 65,292 42 Foreign sales 899,058 870,128 138,492 63,120 75,920r 71,498r 69,074 67,744r 70,687 67,805 43 Net purchases, or sales (—), of stocks and bonds .... -133,423 -55,089 -2,996 -3,662 — 19r —9,587r —4,754r — l,131r 1,051 -4,047 44 Foreign countries -133,584 -55,609 -2,896 -3,845 508r —9,437r —4,707r —l,886r 987 -3,883 45 -90,005 1,385 2,247 223 -2,491r -5,476r -914 -729r 3,419 -1,172 46 Canada -14,997 -6,311 712 -636 891r -814 -510r 1,629 -165 877 47 Latin America and Caribbean -9,229 -22,270 -3,121 -2,403 4,792r -1,481 -2,281 -570r -436 -2,685 48 -15,300 -24,087 -2,833 -681 -l,905r -l,495r 449r -2,205r -1,749 -1,084 49 Africa -185 -474 -126 219 -22 -73 -267 -96 -2 -124 50 Other countries -3,868 -3,852 225 -567 -757r -98 -1,184 85 -80 305 51 Nonmonetary international and regional organizations 161 520 -100 183 -527 -150 -47 755 64 -164 1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait, Oman, agencies and corporations. Also includes issues of new debt securities sold abroad by US. Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). corporations organized to finance direct investments abroad. 2. Includes state and local government securities and securities of U.S. government Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 International Statistics • June 1995 3.25 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Transactions1 Millions of dollars; net purchases, or sales (—) during period 1995 1994 1995 AArreeaa oorr ccoouunnttrryy 11999933 11999944 J F a e n b .- . Aug. Sept. Oct. Nov. Dec. Jan. Feb.p 1 Total estimated 23,451 78,878 23,259 15,133 11,085 10,637 13,112 11,498 9,216 14,043 2 Foreign countries 23,225 78,819 23,215 14,717 11,163 9,542 13,075 11,901 9,890 13,325 3 Europe -2,403 39,214 16,177 8,248 3,922 -1,430 7,786 8,227 2,906 13,271 4 Belgium and Luxembourg 1,218 1,096 241 529 -15 32 25 433 134 107 5 Germany -9,975 6,643 -483 1,795 -243 254 924 725 60 -543 6 Netherlands -515 1,412 2,149 -15 -68 954 -2 156 2,388 -239 7 Sweden 1,421 794 62 -158 105 -37 211 61 -35 97 8 Switzerland -1,501 395 331 -260 441 -718 -1,512 656 166 165 9 United Kingdom 6,167 23,436 10,735 5,336 3,522 -1,822 7,728 6,196 299 10,436 10 Other Europe and former U.S.S.R 782 5,438 3,142 1,021 180 -93 412 0 -106 3,248 11 Canada 10,309 3,168 4,663 1,888 1,515 -420 -1,352 -557 3,177 1,486 12 Latin America and Caribbean -4,572 -9,532 -2,632 -2,311 -666 6,680 713 984 636 -3,268 13 Venezuela 390 -270 118 -132 19 7 43 91 -211 329 14 Other Latin America and Caribbean -5,806 -19,735 -297 3,171 1,487 -449 -2,086 80 3,028 -3,325 15 Netherlands Antilles 844 10,473 -2,453 -5,350 -2,172 7,122 2,756 813 -2,181 -272 16 Asia 20,581 46,298 5,260 5,987 6,761 4,436 4,942 3,642 3,567 1,693 17 Japan 17,070 29,584 5,760 3,681 3,210 2,190 4,551 2,067 3,444 2,316 18 Africa 1,156 240 40 80 200 135 -11 58 -9 49 19 Other -1,846 -569 -293 825 -569 141 997 -453 -387 94 20 Nonmonetary international and regional organizations 226 59 44 416 -78 1,095 37 -403 -674 718 21 International -279 186 -100 317 -65 1,074 73 -322 -708 608 22 Latin American regional 654 75 193 -4 -1 6 4 -3 -6 199 MEMO 23 Foreign countries 23,225 78,819 23,215 14,717 11,163 9,542 13,075 11,901 9,890 13,325 24 Official institutions 1,322 41,525 3,809 9,246 4,688 2,891 2,666 582 1,747 2,062 25 Other foreign 21,903 37,294 19,406 5,471 6,475 6,651 10,409 11,319 8,143 11,263 Oil-exporting countries 26 Middle East2 -8,836 22 -449 621 3 445 623 -405 -360 -89 27 -5 0 0 1 0 0 0 -1 0 0 1. Official and private transactions in marketable US. Treasury securities having an 2. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab original maturity of more than one year. Data are based on monthly transactions reports. Emirates (Trucial States). Excludes nonmarketable U.S. Treasury bonds and notes held by official institutions of 3. Comprises Algeria, Gabon, Libya, and Nigeria. foreign countries. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Interest and Exchange Rates A65 3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS1 Percent per year, averages of daily figures Rate on Apr. 30, 1995 Rate on Apr. 30, 1995 Rate on Apr. 30, 1995 Country Country Country Month Month Month effective effective effective Austria.. 4.0 Mar. 1995 Germany... 4.0 Mar. 1995 Norway 4.75 Feb. 1994 Belgium. 4.0 Mar. 1995 Italy 8.25 Feb. 1995 Switzerland 3.0 Mar. 1995 Canada.. 8.17 Apr. 1995 Japan 1.0 Apr. 1995 United Kingdom 12.0 Sept. 1992 Denmark 6.0 Mar. 1995 Netherlands 4.0 Mar. 1995 France . 5.0 July 1994 1. Rates shown are mainly those at which the central bank either discounts or makes 2. Since February 1981, the rate has been that at which the Bank of France discounts advances against eligible commercial paper or government securities for commercial Treasury bills for seven to ten days. banks or brokers. For countries with more than one rate applicable to such discounts or advances, the rate shown is the one at which it is understood that the central bank transacts the largest proportion of its credit operations. 3.27 FOREIGN SHORT-TERM INTEREST RATES1 Percent per year, averages of daily figures 1994 1995 TTyyppee oorr ccoouunnttrryy 11999922 11999933 11999944 Oct. Nov. Dec. Jan. Feb. Mar. Apr. 3.70 3.18 4.63 5.52 5.78 6.27 6.23 6.14 6.15 6.13 9.56 5.88 5.45 5.83 5.98 6.30 6.50 6.68 6.61 6.64 6.76 5.14 5.57 5.56 5.77 6.75 7.86 8.14 8.32 8.16 9.42 7.17 5.25 5.12 5.10 5.29 5.04 5.00 4.96 4.58 7.67 4.79 4.03 4.02 3.86 4.07 3.95 3.77 3.62 3.33 9.25 6.73 5.09 5.12 5.15 5.35 5.09 5.03 5.03 4.60 10.14 8.30 5.72 5.52 5.49 5.82 5.76 5.70 7.77 7.60 8 Italy 13.91 10.09 8.45 8.80 8.72 88..9988 9.10 9.07 10.98 10.94 9.31 8.10 5.65 5.15 5.09 55..4422 5.29 5.33 6.21 5.22 4.39 2.96 2.24 2.33 2.33 2.34 2.31 2.27 2.11 1.55 1. Rates are for three-month interbank loans, with the following exceptions: Canada, finance company paper; Belgium, three-month Treasury bills; and Japan, CD rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A66 International Statistics • June 1995 3.28 FOREIGN EXCHANGE RATES1 Currency units per dollar except as noted 1994 1995 CCoouunnttrryy//ccuurrrreennccyy uunniitt 11999922 11999933 11999944 Nov. Dec. Jan. Feb. Mar. Apr. 1 Australia/dollar2 73.521 67.993 73.161 75.492 77.389 76.469 74.473 73.452 73.564 2 Austria/schilling 10.992 11.639 11.409 10.838 11.063 10.769 10.573 9.898 9.720 3 Belgium/franc 32.148 34.581 33.426 31.694 32.329 31.542 30.908 29.035 28.419 4 Canada/dollar 1.2085 1.2902 1.3664 1.3647 1.3893 1.4132 1.4005 1.4077 1.3762 5 China, P.R./yuan 5.5206 5.7795 8.6404 8.5370 8.5119 8.4608 8.4553 8.4483 8.4421 6 Denmark/krone 6.0372 6.4863 6.3561 6.0268 6.1614 6.0311 5.9302 5.6281 5.4391 7 Finland/markka 4.4865 5.7251 5.2340 4.7388 4.8590 4.7506 4.6547 4.3967 4.2884 8 France/franc 5.2935 5.6669 5.5459 5.2867 5.4132 5.2912 5.2252 4.9756 4.8503 9 Germany/deutsche mark 1.5618 1.6545 1.6216 1.5396 1.5716 1.5302 1.5022 1.4061 1.3812 10 Greece/drachma 190.81 229.64 242.50 237.38 242.96 238.21 236.17 228.53 225.19 11 Hong Kong/dollar 7.7402 7.7357 7.7290 7.7306 7.7379 7.7439 7.7314 7.7318 7.7336 12 India/rupee 28.156 31.291 31.394 31.394 31.389 31.374 31.380 31.587 31.407 13 Ireland/pound2 170.42 146.47 149.69 156.39 153.36 155.67 156.20 159.76 162.80 14 Italy /lira 1,232.17 1,573.41 1,611.49 1,583.81 1,633.71 1,611.53 1,620.58 1,688.99 1,710.89 15 Japan/yen 126.78 111.08 102.18 98.04 100.18 99.77 98.24 90.52 83.69 16 Malaysia/ringgit 2.5463 2.5738 2.6237 2.5604 2.5626 2.5556 2.5526 2.5464 2.4787 17 Netherlands/guilder 1.7587 1.8585 1.8190 1.7261 1.7601 1.7159 1.6844 1.5774 1.5474 18 New Zealand/dollar2 53.792 54.127 59.358 62.093 63.726 64.018 63.448 64.598 66.723 19 Norway/krone 6.2142 7.1009 7.0553 6.7297 6.8561 6.6968 6.5974 6.2730 6.2050 20 Portugal/escudo 135.07 161.08 165.93 157.27 161.21 157.86 155.36 147.92 145.89 21 Singapore/dollar 1.6294 1.6158 1.5275 1.4682 1.4657 1.4532 1.4541 1.4216 1.3986 22 South Africa/rand 2.8524 3.2729 3.5526 3.5256 3.5614 3.5404 3.5629 3.6013 3.6035 23 South Korea/won 784.66 805.75 806.93 799.46 794.81 793.08 793.19 781.81 770.61 24 Spain/peseta 102.38 127.48 133.88 128.34 132.31 132.62 130.52 128.58 124.14 25 Sri Lanka/rupee 44.013 48.211 49.170 49.163 49.531 49.870 49.895 49.627 49.371 26 Sweden/krona 5.8258 7.7956 7.7161 7.3637 7.5161 7.4775 7.3914 7.2787 7.3455 27 Switzerland/franc 1.4064 1.4781 1.3667 1.2956 1.3289 1.2863 1.2715 1.1709 1.1384 28 Taiwan/dollar 25.160 26.416 26.465 26.188 26.381 26.300 26.339 26.102 25.491 29 Thailand/baht 25.411 25.333 25.161 24.992 25.109 25.133 25.020 24.760 24.572 30 United Kingdom/pound2 176.63 150.16 153.19 158.92 155.87 157.46 157.20 160.02 160.73 MEMO 31 United States/dollar3 86.61 93.18 91.32 87.71 89.64 88.30 87.29 83.69 81.81 1. Averages of certified noon buying rates in New York for cable transfers. Data in this world trade of that country divided by the average world trade of all ten countries table also appear in the Board's G.5 (405) monthly statistical release. For ordering combined. Series revised as of August 1978 (see Federal Reserve Bulletin, vol. 64 address, see inside front cover. (August 1978), p. 700). 2. Value in U.S. cents. 3. Index of weighted-average exchange value of U.S. dollar against the currencies of ten industrial countries. The weight for each of the ten countries is the 1972-76 average Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

67 Guide to Statistical Releases and Special Tables STATISTICAL RELEASES—List Published Semiannually, with Latest Bulletin Reference Issue Page Anticipated schedule of release dates for periodic releases June 1995 A76 SPECIAL TABLES—Quarterly Data Published Irregularly, with Latest Bulletin Reference Title and Date Issue Page Assets and liabilities of commercial banks March 31, 1993 August 1993 A70 June 30, 1993 November 1993 A70 September 30, 1993 February 1994 A70 December 31, 1993 May 1994 A68 Terms of lending at commercial banks May 1994 August 1994 A68 August 1994 November 1994 A68 November 1994 February 1995 A68 February 1995 May 1995 A68 Assets and liabilities of U.S. branches and agencies of foreign banks March 31, 1994 August 1994 A72 June 30, 1994 November 1994 A72 September 30, 1994 February 1995 A72 December 31, 1994 May 1995 A72 Pro forma balance sheet and income statements for priced service operations June 30, 1991 November 1991 A80 September 30, 1991 January 1992 A70 March 30, 1992 August 1992 A80 June 30, 1992 October 1992 A70 Assets and liabilities of life insurance companies June 30, 1991 December 1991 A79 September 30, 1991 May 1992 A81 December 31, 1991 August 1992 A83 September 30, 1992 March 1993 A71 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

68 Index to Statistical Tables References are to pages A3-A66 although the prefix "A" is omitted in this index ACCEPTANCES, bankers (See Bankers acceptances) Demand deposits—Continued Agricultural loans, commercial banks, 21, 22 Ownership by individuals, partnerships, and Assets and liabilities (See also Foreigners) corporations, 23 Banks, by classes, 18-22 Turnover, 17 Domestic finance companies, 36 Depository institutions Federal Reserve Banks, 11 Reserve requirements, 9 Financial institutions, 28 Reserves and related items, 4, 5, 6, 13 Foreign banks, U.S. branches and agencies, 23 Deposits (See also specific types) Automobiles Banks, by classes, 4, 18-22, 24 Consumer installment credit, 39 Federal Reserve Banks, 5, 11 Production, 47, 48 Interest rates, 16 Turnover, 17 BANKERS acceptances, 10, 22, 26 Discount rates at Reserve Banks and at foreign central banks and Bankers balances, 18-22. (See also Foreigners) foreign countries (See Interest rates) Bonds (See also U.S. government securities) Discounts and advances by Reserve Banks (See Loans) New issues, 35 Dividends, corporate, 35 Rates, 26 Branch banks, 23 EMPLOYMENT, 45 Business activity, nonfinancial, 45 Eurodollars, 26 Business expenditures on new plant and equipment, 35 Business loans (See Commercial and industrial loans) FARM mortgage loans, 38 Federal agency obligations, 5, 10, 11, 12, 31, 32 Federal credit agencies, 33 CAPACITY utilization, 46 Federal finance Capital accounts Debt subject to statutory limitation, and types and ownership Banks, by classes, 18 of gross debt, 30 Federal Reserve Banks, 11 Receipts and outlays, 28, 29 Central banks, discount rates, 65 Treasury financing of surplus, or deficit, 28 Certificates of deposit, 26 Treasury operating balance, 28 Commercial and industrial loans Federal Financing Bank, 28, 33 Commercial banks, 21 Federal funds, 7, 19, 21, 22, 23, 26, 28 Weekly reporting banks, 21-23 Federal Home Loan Banks, 33 Commercial banks Federal Home Loan Mortgage Corporation, 33, 37, 38 Assets and liabilities, 18-22 Federal Housing Administration, 33, 37, 38 Commercial and industrial loans, 18-23 Federal Land Banks, 38 Consumer loans held, by type and terms, 39 Federal National Mortgage Association, 33, 37, 38 Deposit interest rates of insured, 16 Federal Reserve Banks Loans sold outright, 22 Condition statement, 11 Real estate mortgages held, by holder and property, 38 Discount rates (See Interest rates) Time and savings deposits, 4 U.S. government securities held, 5, 11, 12, 30 Commercial paper, 24, 26, 36 Federal Reserve credit, 5, 6, 11, 12 Condition statements (See Assets and liabilities) Federal Reserve notes, 11 Construction, 45, 49 Federally sponsored credit agencies, 33 Consumer installment credit, 39 Finance companies Consumer prices, 45,46 Assets and liabilities, 36 Consumption expenditures, 52, 53 Business credit, 36 Corporations Loans, 39 Nonfinancial, assets and liabilities, 35 Paper, 24, 26 Profits and their distribution, 35 Financial institutions, loans to, 21, 22, 23 Security issues, 34, 65 Float, 5 Cost of living (See Consumer prices) Flow of funds, 40, 42, 43, 44 Credit unions, 39 Currency in circulation, 5, 14 Foreign banks, assets and liabilities of U.S. branches and Customer credit, stock market, 27 agencies, 22, 23 Foreign currency operations, 11 Foreign deposits in U.S. banks, 5, 11, 21, 22 DEBITS to deposit accounts, 17 Foreign exchange rates, 66 Debt (See specific types of debt or securities) Foreign trade, 54Foreigners Demand deposits Claims on, 55, 58, 59, 60, 62 Banks, by classes, 18-23 Liabilities to, 22, 54, 55, 56, 61, 63, 64 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

69 GOLD REAL estate loans Certificate account, 11 Banks, by classes, 21, 22, 38 Stock, 5, 54 Terms, yields, and activity, 37 Government National Mortgage Association, 33, 37, 38 Type of holder and property mortgaged, 38 Gross domestic product, 51 Repurchase agreements, 7, 21-23 Reserve requirements, 9 Reserves HOUSING, new and existing units, 49 Commercial banks, 18 Depository institutions, 4, 5, 6, 13 INCOME, personal and national, 45, 51, 52 Federal Reserve Banks, 11 Industrial production, 45, 47 U.S. reserve assets, 54 Installment loans, 39 Residential mortgage loans, 37 Insurance companies, 30, 38 Retail credit and retail sales, 39, 40, 45 Interest rates Bonds, 26 Consumer installment credit, 39 SAVING Deposits, 16 Flow of funds, 40, 42, 43, 44 Federal Reserve Banks, 8 National income accounts, 51 Foreign central banks and foreign countries, 66 Savings and loan associations, 38, 39, 40 Money and capital markets, 26 Savings banks, 38, 39 Mortgages, 37 Savings deposits (See Time and savings deposits) Prime rate, 25 Securities (See also specific types) International capital transactions of United States, 53-65 Federal and federally sponsored credit agencies, 33 International organizations, 55, 56, 58, 61, 62 Foreign transactions, 63 Inventories, 51 New issues, 34 Investment companies, issues and assets, 35 Prices, 27 Investments (See also specific types) Special drawing rights, 5, 11, 53, 54 Banks, by classes, 18-23 State and local governments Commercial banks, 4, 18-23 Deposits, 21, 22 Federal Reserve Banks, 11, 12 Holdings of U.S. government securities, 30 Financial institutions, 38 New security issues, 34 Ownership of securities issued by, 21, 22 Rates on securities, 26 LABOR force, 45 Stock market, selected statistics, 27 Life insurance companies (See Insurance companies) Stocks (See also Securities) Loans (See also specific types) New issues, 34 Banks, by classes, 18—23 Prices, 27 Commercial banks, 4, 18-23 Federal Reserve Banks, 5, 6, 8, 11, 12 Student Loan Marketing Association, 33 Financial institutions, 38 Insured or guaranteed by United States, 37, 38 TAX receipts, federal, 29 MANUFACTURING Thrift institutions, 4. (See also Credit unions and Savings and Capacity utilization, 46 loan associations) Production, 46, 48 Time and savings deposits, 4, 14, 16, 18-23 Margin requirements, 27 Trade, foreign, 54 Member banks (See also Depository institutions) Treasury cash, Treasury currency, 5 Federal funds and repurchase agreements, 7 Treasury deposits, 5, 11, 28 Reserve requirements, 9 Treasury operating balance, 28 Mining production, 48 UNEMPLOYMENT, 45 Mobile homes shipped, 49 U.S. government balances Monetary and credit aggregates, 4, 13 Commercial bank holdings, 18-23 Money and capital market rates, 26 Treasury deposits at Reserve Banks, 5, 11, 28 Money stock measures and components, 4, 14 U.S. government securities Mortgages (See Real estate loans) Bank holdings, 18-23, 30 Mutual funds, 35 Dealer transactions, positions, and financing, 32 Mutual savings banks (See Thrift institutions) Federal Reserve Bank holdings, 5, 11, 12, 30 Foreign and international holdings and transactions, 11, 30, 64 NATIONAL defense outlays, 29 Open market transactions, 10 National income, 51 Outstanding, by type and holder, 28, 30 Rates, 26 OPEN market transactions, 10 U.S. international transactions, 53-66 Utilities, production, 48 PERSONAL income, 52 Prices VETERANS Administration, 37, 38 Consumer and producer, 45, 50 Stock market, 27 WEEKLY reporting banks, 22-24 Prime rate, 25 Wholesale (producer) prices, 45, 50 Producer prices, 45, 50 Production, 45, 47 Profits, corporate, 35 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

70 Federal Reserve Board of Governors and Official Staff ALAN GREENSPAN, Chairman EDWARD W. KELLEY, JR. ALAN S. BLINDER, Vice Chairman LAWRENCE B. LINDSEY OFFICE OF BOARD MEMBERS DIVISION OF INTERNATIONAL FINANCE JOSEPH R. COYNE, Assistant to the Board EDWIN M. TRUMAN, Staff Director LARRY J. PROMISEL, Senior Associate Director DONALD J. WINN, Assistant to the Board THEODORE E. ALLISON, Assistant to the Board for Federal CHARLES J. SIEGMAN, Senior Associate Director Reserve System Affairs DALE W. HENDERSON, Associate Director LYNN S. FOX, Deputy Congressional Liaison DAVID H. HOWARD, Senior Adviser WINTHROP P. HAMBLEY, Special Assistant to the Board DONALD B. ADAMS, Assistant Director BOB STAHLY MOORE, Special Assistant to the Board THOMAS A. CONNORS, Assistant Director DIANE E. WERNEKE, Special Assistant to the Board PETER HOOPER III, Assistant Director PORTIA W. THOMPSON, Equal Employment Opportunity KAREN H. JOHNSON, Assistant Director Programs Adviser CATHERINE L. MANN, Assistant Director RALPH W. SMITH, JR., Assistant Director LEGAL DIVISION DIVISION OF RESEARCH AND STATISTICS J. VIRGIL MATTINGLY, JR., General Counsel SCOTT G. ALVAREZ, Associate General Counsel MICHAEL J. PRELL, Director RICHARD M. ASHTON, Associate General Counsel EDWARD C. ETTIN, Deputy Director OLIVER IRELAND, Associate General Counsel DAVID J. STOCKTON, Deputy Director KATHLEEN M. O'DAY, Associate General Counsel MARTHA BETHEA, Associate Director ROBERT DEV. FRIERSON, Assistant General Counsel WILLIAM R. JONES, Associate Director KATHERINE H. WHEATLEY, Assistant General Counsel MYRON L. KWAST, Associate Director PATRICK M. PARKINSON, Associate Director OFFICE OF THE SECRETARY THOMAS D. SIMPSON, Associate Director LAWRENCE SLIFMAN, Associate Director WILLIAM W. WILES, Secretary MARTHA S. SCANLON, Deputy Associate Director JENNIFER J. JOHNSON, Deputy Secretary PETER A. TINSLEY, Deputy Associate Director BARBARA R. LOWREY, Associate Secretary FLINT BRAYTON, Assistant Director DAY W. RADEBAUGH, JR., Assistant Secretary1 DAVID S. JONES, Assistant Director STEPHEN A. RHOADES, Assistant Director DIVISION OF BANKING CHARLES S. STRUCKMEYER, Assistant Director SUPERVISION AND REGULATION ALICE PATRICIA WHITE, Assistant Director RICHARD SPILLENKOTHEN, Director JOYCE K. ZICKLER, Assistant Director STEPHEN C. SCHEMERING, Deputy Director JOHN J. MINGO, Senior Adviser DON E. KLINE, Associate Director GLENN B. CANNER, Adviser WILLIAM A. RYBACK, Associate Director FREDERICK M. STRUBLE, Associate Director DIVISION OF MONETARY AFFAIRS HERBERT A. BIERN, Deputy Associate Director ROGER T. COLE, Deputy Associate Director DONALD L. KOHN, Director JAMES I. GARNER, Deputy Associate Director DAVID E. LINDSEY, Deputy Director HOWARD A. AMER, Assistant Director BRIAN F. MADIGAN, Associate Director GERALD A. EDWARDS, JR., Assistant Director RICHARD D. PORTER, Deputy Associate Director JAMES D. GOETZINGER, Assistant Director VINCENT R. REINHART, Assistant Director STEPHEN M. HOFFMAN, JR., Assistant Director NORMAND R.V. BERNARD, Special Assistant to the Board LAURA M. HOMER, Assistant Director JAMES V. HOUPT, Assistant Director DIVISION OF CONSUMER JACK P. JENNINGS, Assistant Director AND COMMUNITY AFFAIRS MICHAEL G. MARTINSON, Assistant Director GRIFFITH L. GARWOOD, Director RHOGER H PUGH, Assistant Director GLENN E. LONEY, Associate Director SIDNEY M. SUSSAN, Assistant Director DOLORES S. SMITH, Associate Director MOLLY S. WASSOM, Assistant Director MAUREEN P. ENGLISH, Assistant Director WILLIAM SCHNEIDER, Project Director, IRENE SHAWN MCNULTY, Assistant Director National Information Center 1. On loan from the Division of Information Resources Management Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SUSAN M. PHILLIPS JANET L. YELLEN OFFICE OF DIVISION OF RESERVE BANK OPERATIONS STAFF DIRECTOR FOR MANAGEMENT AND PA YMENT SYSTEMS S. DAVID FROST, Staff Director CLYDE H. FARNSWORTH, JR., Director SHEILA CLARK, EEO Programs Director DAVID L. ROBINSON, Deputy Director (Finance and Control) DIVISION OF HUMAN RESOURCES LOUISE L. ROSEMAN, Associate Director MANAGEMENT CHARLES W. BENNETT, Assistant Director JACK DENNIS, JR., Assistant Director DAVID L. SHANNON, Director EARL G. HAMILTON, Assistant Director JOHN R. WEIS, Associate Director JEFFREY C. MARQUARDT, Assistant Director ANTHONY V. DIGIOIA, Assistant Director JOHN H. PARRISH, Assistant Director JOSEPH H. HAYES, JR., Assistant Director FLORENCE M. YOUNG, Assistant Director FRED HOROWITZ, Assistant Director OFFICE OF THE INSPECTOR GENERAL OFFICE OF THE CONTROLLER BRENT L. BOWEN, Inspector General GEORGE E. LIVINGSTON, Controller DONALD L. ROBINSON, Assistant Inspector General STEPHEN J. CLARK, Assistant Controller (Programs and BARRY R. SNYDER, Assistant Inspector General 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 DIVISION OF INFORMATION RESOURCES MANAGEMENT STEPHEN R. MALPHRUS, Director MARIANNE M. EMERSON, Assistant Director Po KYUNG KIM, Assistant Director RAYMOND H. MASSEY, Assistant Director EDWARD T. MULRENIN, Assistant Director ELIZABETH B. RIGGS, Assistant Director RICHARD C. STEVENS, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

72 Federal Reserve Bulletin • June 1995 Federal Open Market Committee and Advisory Councils FEDERAL OPEN MARKET COMMITTEE MEMBERS ALAN GREENSPAN, Chairman WILLIAM J. MCDONOUGH, Vice Chairman ALAN S. BLINDER LAWRENCE B. LINDSEY MICHAEL H. MOSKOW THOMAS M. HOENIG THOMAS C. MELZER SUSAN M. PHILLIPS EDWARD W. KELLEY, JR. CATHY E. MINEHAN JANET L. YELLEN ALTERNATE MEMBERS EDWARD G. BOEHNE ROBERT D. MCTEER GARY H. STERN JERRY L. JORDAN ERNEST T. PATRIKIS STAFF DONALD L. KOHN, Secretary and Economist WILLIAM G. DEWALD, Associate Economist NORMAND R.V. BERNARD, Deputy Secretary WILLIAM C. HUNTER, Associate Economist JOSEPH R. COYNE, Assistant Secretary DAVID E. LINDSEY, Associate Economist GARY P. GILLUM, Assistant Secretary FREDERIC S. MISHKIN, Associate Economist J. VIRGIL MATTINGLY, JR., General Counsel LARRY J. PROMISEL, Associate Economist THOMAS C. BAXTER, JR., Deputy General Counsel CHARLES J. SIEGMAN, Associate Economist MICHAEL J. PRELL, Economist LAWRENCE SLIFMAN, Associate Economist EDWIN M. TRUMAN, Economist DAVID J. STOCKTON, Associate Economist LYNN E. BROWNE, Associate Economist CARL E. VANDER WILT, Associate Economist THOMAS E. DAVIS, Associate Economist PETER R. FISHER, Manager, System Open Market Account FEDERAL ADVISORY COUNCIL ANTHONY P. TERRACCIANO, President MARSHALL N. CARTER, Vice President MARSHALL N. CARTER, First District ROGER L. FITZSIMONDS, Seventh District WALTER V. SHIPLEY, Second District ANDREW B. CRAIG, III, Eighth District ANTHONY P. TERRACCIANO, Third District RICHARD M. KOVACEVICH, Ninth District FRANK V. CAHOUET, Fourth District CHARLES E. NELSON, Tenth District RICHARD G. TILGHMAN, Fifth District CHARLES R. HRDLICKA, Eleventh District CHARLES E. RICE, Sixth District EDWARD A. CARSON, Twelfth District HERBERT V. PROCHNOW, Secretary Emeritus JAMES ANNABLE, Co-Secretary WILLIAM J. KORSVIK, Co-Secretary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

CONSUMER ADVISORY COUNCIL JAMES L. WEST, Tijeras, New Mexico, Chairman KATHARINE W. MCKEE, Washington, D.C., Vice Chairman D. DOUGLAS BLANKE, St. Paul, Minnesota THOMAS L. HOUSTON, Dallas, Texas THOMAS R. BUTLER, Riverwoods, Illinois TERRY JORDE, Cando, North Dakota ROBERT A. COOK, Baltimore, Maryland EUGENE I. LEHRMANN, Madison, Wisconsin ALVIN J. COWANS, Orlando, Florida RONALD A. PRILL, Minneapolis, Minnesota MICHAEL FERRY, St. Louis, Missouri LISA RICE-COLEMAN, Toledo, Ohio ELIZABETH G. FLORES, Laredo, Texas JOHN R. RINES, Detroit, Michigan EMANUEL FREEMAN, Philadelphia, Pennsylvania JULIA M. SEWARD, Richmond, Virginia NORMA L. FREIBERG, New Orleans, Louisiana ANNE B. SHLAY, Philadelphia, Pennsylvania DAVID C. FYNN, Cleveland, Ohio REGINALD J. SMITH, Kansas City, Missouri LORI GAY, Los Angeles, California JOHN E. TAYLOR, Washington, D.C. ROBERT G. GREER, Houston, Texas LORRAINE VANETTEN, Troy, Michigan KENNETH R. HARNEY, Chevy Chase, Maryland GRACE W. WEINSTEIN, Englewood, New Jersey GAIL K. HILLEBRAND, San Francisco, California LILY K. YAO, Honolulu, Hawaii RONALD A. HOMER, Boston, Massachusetts ROBERT O. ZDENEK, Baltimore, Maryland THRIFT INSTITUTIONS ADVISORY COUNCIL CHARLES JOHN KOCH, Cleveland, Ohio, President STEPHEN D. TAYLOR, Miami, Florida, Vice President E. LEE BEARD, Hazleton, Pennsylvania DAVID F. HOLLAND, Burlington, Massachusetts JOHN E. BRUBAKER, San Mateo, California JOSEPH C. SCULLY, Chicago, Illinois MALCOLM E. COLLIER, Lakewood, Colorado JOHN M. TIPPETS, DFW Airport, Texas GEORGE L. ENGELKE, JR., Lake Success, New York LARRY T. WILSON, Raleigh, North Carolina BEVERLY D. HARRIS, Livingston, Montana WILLIAM W. ZUPPE, Spokane, Washington Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

74 Federal Reserve Board Publications For ordering assistance, write PUBLICATIONS SERVICES, FEDERAL RESERVE REGULATORY SERVICE. Loose-leaf; updated MS-127, Board of Governors of the Federal Reserve System, monthly. (Requests must be prepaid.) Washington, DC 20551 or telephone (202) 452-3244 or FAX Consumer and Community Affairs Handbook. $75.00 per (202) 728-5886. When a charge is indicated, payment should year. accompany request and be made payable to the Board of Monetary Policy and Reserve Requirements Handbook. Governors of the Federal Reserve System or may be ordered $75.00 per year. via Mastercard or Visa. Payment from foreign residents should Securities Credit Transactions Handbook. $75.00 per year. be drawn on a U.S. bank. The Payment System Handbook. $75.00 per year. Federal Reserve Regulatory Service. Four vols. (Contains all four Handbooks plus substantial additional material.) $200.00 per year. THE FEDERAL RESERVE SYSTEM—PURPOSES AND FUNCTIONS. Rates for subscribers outside the United States are as follows 1994. 157 pp. and include additional air mail costs: ANNUAL REPORT. Federal Reserve Regulatory Service, $250.00 per year. ANNUAL REPORT: BUDGET REVIEW, 1994-95. Each Handbook, $90.00 per year. FEDERAL RESERVE BULLETIN. Monthly. $25.00 per year or THE U.S. ECONOMY IN AN INTERDEPENDENT WORLD: A MULTI- $2.50 each in the United States, its possessions, Canada, COUNTRY MODEL, May 1984. 590 pp. $14.50 each. and Mexico. Elsewhere, $35.00 per year or $3.00 each. WELCOME TO THE FEDERAL RESERVE. March 1989. 14 pp. ANNUAL STATISTICAL DIGEST: period covered, release date, INDUSTRIAL PRODUCTION—1986 EDITION. December 1986. number of pages, and price. 440 pp. $9.00 each. 1981 October 1982 239 pp. $ 6.50 FINANCIAL FUTURES AND OPTIONS IN THE U.S. ECONOMY. 1982 December 1983 266 pp. $ 7.50 December 1986. 264 pp. $10.00 each. 1983 October 1984 264 pp. $11.50 FINANCIAL SECTORS IN OPEN ECONOMIES: EMPIRICAL ANALY- 1984 October 1985 254 pp. $12.50 SIS AND POLICY ISSUES. August 1990. 608 pp. $25.00 each. 1985 October 1986 231 pp. $15.00 1986 November 1987 288 pp. $15.00 1987 October 1988 272 pp. $15.00 EDUCATION PAMPHLETS 1988 November 1989 256 pp. $25.00 Short pamphlets suitable for classroom use. Multiple copies are 1980-89 March 1991 712 pp. $25.00 available without charge. 1990 November 1991 185 pp. $25.00 1991 November 1992 215 pp. $25.00 Consumer Handbook on Adjustable Rate Mortgages 1992 December 1993 215 pp. $25.00 Consumer Handbook to Credit Protection Laws 1993 December 1994 281 pp. $25.00 A Guide to Business Credit for Women, Minorities, and Small Businesses Series on the Structure of the Federal Reserve System SELECTED INTEREST AND EXCHANGE RATES—WEEKLY SERIES The Board of Governors of the Federal Reserve System OF CHARTS. Weekly. $30.00 per year or $.70 each in the The Federal Open Market Committee United States, its possessions, Canada, and Mexico. Else- Federal Reserve Bank Board of Directors where, $35.00 per year or $.80 each. Federal Reserve Banks Organization and Advisory Committees THE FEDERAL RESERVE ACT and other statutory provisions A Consumer's Guide to Mortgage Lock-Ins affecting the Federal Reserve System, as amended through A Consumer's Guide to Mortgage Settlement Costs August 1990. 646 pp. $10.00. A Consumer's Guide to Mortgage Refinancings REGULATIONS OF THE BOARD OF GOVERNORS OF THE FEDERAL Home Mortgages: Understanding the Process and Your Right RESERVE SYSTEM. to Fair Lending ANNUAL PERCENTAGE RATE TABLES (Truth in Lending— How to File a Consumer Complaint Regulation Z) Vol. I (Regular Transactions). 1969. 100 pp. Making Deposits: When Will Your Money Be Available? Vol II (Irregular Transactions). 1969. 116 pp. Each vol- Making Sense of Savings ume $2.25. SHOP: The Card You Pick Can Save You Money GUIDE TO THE FLOW OF FUNDS ACCOUNTS. 672 pp. $8.50 When Your Home is on the Line: What You Should Know each. About Home Equity Lines of Credit Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

75 STAFF STUDIES: Only Summaries Printed in the 162. EVIDENCE ON THE SIZE OF BANKING MARKETS FROM MORTGAGE LOAN RATES IN TWENTY CITIES, by Stephen BULLETIN A. Rhoades. February 1992. 11 pp. Studies and papers on economic and financial subjects that are of general interest. Requests to obtain single copies of the full 163. CLEARANCE AND SETTLEMENT IN U.S. SECURITIES MAR- KETS, by Patrick Parkinson, Adam Gilbert, Emily Gollob, text or to be added to the mailing list for the series may be sent Lauren Hargraves, Richard Mead, Jeff Stehm, and Mary to Publications Services. Ann Taylor. March 1992. 37 pp. 164. THE 1989-92 CREDIT CRUNCH FOR REAL ESTATE, by Staff Studies 1-157 are out of print. James T. Fergus and John L. Goodman, Jr. July 1993. 20 pp. 158. THE ADEQUACY AND CONSISTENCY OF MARGIN REQUIRE- 165. THE DEMAND FOR TRADE CREDIT: AN INVESTIGATION OF MENTS IN THE MARKETS FOR STOCKS AND DERIVATIVE MOTIVES FOR TRADE CREDIT USE BY SMALL BUSINESSES, PRODUCTS, by Mark J. Warshawsky with the assistance of by Gregory E. Elliehausen and John D. Wolken. Septem- Dietrich Earnhart. September 1989. 23 pp. ber 1993. 18 pp. 159. NEW DATA ON THE PERFORMANCE OF NONBANK SUBSID- 166. THE ECONOMICS OF THE PRIVATE PLACEMENT MARKET, IARIES OF BANK HOLDING COMPANIES, by Nellie Liang by Mark Carey, Stephen Prowse, John Rea, and Gregory and Donald Savage. February 1990. 12 pp. Udell. January 1994. Ill pp. 160. BANKING MARKETS AND THE USE OF FINANCIAL SER- 167. A SUMMARY OF MERGER PERFORMANCE STUDIES IN VICES BY SMALL AND MEDIUM-SIZED BUSINESSES, by BANKING, 1980-93, AND AN ASSESSMENT OF THE "OPER- Gregory E. Elliehausen and John D. Wolken. September ATING PERFORMANCE" AND "EVENT STUDY" METHOD- 1990. 35 pp. OLOGIES, by Stephen A. Rhoades. July 1994. 37 pp. 161. A REVIEW OF CORPORATE RESTRUCTURING ACTIVITY, 1980-90, by Margaret Hastings Pickering. May 1991. 21pp. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

76 ANTICIPATED SCHEDULE OF RELEASE DATES FOR PERIODIC RELEASES—BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM (PAYMENT MUST ACCOMPANY REQUESTS) Annual Approximate Date of period to which data Weekly Releases1 rate release days2 refer • Aggregate Reserves of Depository Institutions and $20.00 Thursday Week ended previous the Monetary Base. H.3 (502) [1.20] Wednesday • Actions of the Board: Applications and Reports $55.00 Friday Week ended previous Saturday Received. H.2 (501) • Assets and Liabilities of Commercial Banks $30.00 Friday Week ended previous in the United States. H.8 (510) [1.26] Wednesday • Factors Affecting Reserves of Depository $20.00 Thursday Week ended previous Institutions and Condition Statement of Federal Wednesday Reserve Banks. H.4.1 (503) [1.11, 1.18] • Foreign Exchange Rates. H.10 (512) [3.28] $20.00 Monday Week ended previous Friday • Money Stock, Liquid Assets, and Debt Measures. $35.00 Thursday Week ended Monday of H.6 (508) [1.21] previous week • Selected Borrowings in Immediately Available $20.00 Wednesday Week ended Thursday of Funds of Large Commercial Banks. H.5 (507) previous week [1.13] • Selected Interest Rates. H.15 (519) [1.35] $20.00 Monday Week ended previous Saturday • Weekly Consolidated Condition Report of Large $20.00 Friday Wednesday, one week earlier Commercial Banks in the United States. H.4.2 (504) [1.26, 1.27, 1.28] Monthly Releases1 • Consumer Installment Credit. G.19 (421) [1.55, $ 5.00 Fifth working day of Second month previous 1.56] month • Debits and Deposit Turnover at Commercial Banks. $ 5.00 Twelfth of month Previous month G.6 (406) [1.23] • Finance Companies. G.20 (422) [1.51, 1.52] $ 5.00 Fifth working day of Second month previous month • Foreign Exchange Rates. G.5 (405) [3.28] $ 5.00 First of month Previous month • Industrial Production and Capacity Utilization. G.17 $15.00 Midmonth Previous month (419) [2.12, 2.13] • Research Library—Recent Acquisitions. G.15 (417) Free of First of month Previous month charge • Selected Interest Rates. G. 13 (415) [1.35] $ 5.00 First Tuesday of Previous month month 1. The data in some releases are also reported in the Bulletin statistical appendix, and the Bulletin table numbers are shown in brackets. 2. Please note that for some releases there is normally a certain variability in the release date because of reporting or processing procedures. Moreover, for all series unusual circumstances may, from time to time, result in a release date being later than anticipated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Annual Approximate Date of period to which data Quarterly Releases1 rate release days 2 refer • Agricultural Finance Databook. E.15 (125) End of March, January, April, July, and $ 5.00 June, September, October and December • Country Exposure Lending Survey. E.16 (126) January, April, $ 5.00 Previous quarter July, and October • Flow of Funds Accounts: Seasonally Adjusted 23rd of February, $25.00 Previous quarter and Unadjusted. Z.l (780) [1.57, 1.58] May, August, and November • Flow of Funds Summary Statistics. Z.l (788) 15 th of February, $ 5.00 Previous quarter [1.59, 1.60] May, August, and November • Geographical Distribution of Assets and Liabilities 15th of March, Previous quarter $ 5.00 of Major Foreign Branches of U.S. Banks. E. 11 June, September, (121) and December • Survey of Terms of Bank Lending to Business. E.2 Midmonth of February, May, August, and $ 5.00 (111) [4.23] March, June, November September, and December • List of OTC Margin Stocks. E.7 (117) Free of January, April, February, May, August, and charge July, and November October Semiannual Releases Previous year • Balance Sheets for the U.S. Economy. C.9 (108) $ 5.00 October and April Annual Releases • Aggregate Summaries of Annual Surveys of $ 5.00 February End of previous June Securities Credit Extension. C.2 (101) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

78 Maps of the Federal Reserve System BOSTON • NEW YORK PHILADELPHIA • S? Louis 5 ATLANTA 11 • ALASKA HAWAII LEGEND Both pages Facing page • Federal Reserve Bank city • Federal Reserve Branch city • Board of Governors of the Federal — Branch boundary Reserve System, Washington, D.C. NOTE The Federal Reserve officially identifies Districts Commonwealth of Puerto Rico and the U.S. Virgin by number and Reserve Bank city (shown on both Islands; the San Francisco Bank serves American pages) and by letter (shown on the facing page). Samoa, Guam, and the Commonwealth of the In the 12th District, the Seattle Branch serves Northern Mariana Islands. The Board of Governors Alaska, and the San Francisco Bank serves Hawaii. revised the branch boundaries of the System most The System serves commonwealths and terri- recently in December 1991. Digitized for FRASER http://fraser.stloutisofreide.os rga/s follows: the New York Bank serves the Federal Reserve Bank of St. Louis

79 1-A 2-B 3-C 4-D Pittsburgh 5-E Baltimore MD / OH • r : -m t i wv NC •Cincinnati •Charlotte Buffalo KY / I /* \ MA NJ NY CT RI sc BOSTON NEW YORK PHILADELPHIA CLEVELAND RICHMOND 6-F 7-G 8-H • Nashville M MI MO KY • Detroit* y Louisville 1 TN Jacksonville ""A • Memphis Little/ New Orleans MS Rock ( Miami* ATLANTA CHICAGO ST. LOUIS 9-1 M M • Helena MI sn • MINNEAPOLIS 10-J 12-L WY Omaha • CCOO \ UA Denver * v";' • MM I Oklahoma City • OK KANSAS CITY 11-K TX Salt Lake City NM .... M • EL Paso 1 I—^YTI°USTON •Los Angeles ( • S San Antonio^- DALLAS SAN FRANCISCO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

80 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 Jerome H. Grossman Cathy E. Minehan William C. Brainard Paul M. Connolly NEW YORK* 10045 Maurice R. Greenberg William J. McDonough David A. Hamburg Ernest T. Patrikis Buffalo 14240 Joseph J. Castiglia Carl W. Turnipseed1 PHILADELPHIA 19105 James M. Mead Edward G. Boehne Donald J. Kennedy William H. Stone, Jr. CLEVELAND* 44101 A. William Reynolds Jerry L. Jordan G. Watts Humphrey, Jr. Sandra Pianalto Cincinnati 45201 John N. Taylor, Jr. Charles A. Cerino1 Pittsburgh 15230 Robert P Bozzone Harold J. Swart1 RICHMOND* 23219 Henry J. Faison J. Alfred Broaddus, Jr. Claudine B. Malone Walter A. Varvel Baltimore 21203 Michael R. Watson Ronald B. Duncan1 Charlotte 28230 James O. Roberson Dan M. Bechter1 Culpeper 22701 Julius Malinowski, Jr.2 ATLANTA 30303 Leo Benatar Robert P. Forrestal Hugh M. Brown JJaacckk GGuuyynnnn Donald E. Nelson1 Birmingham 35283 Patricia B. Compton FredR. Herr1 Jacksonville 32231 Lana Jane Lewis-Brent James D. Hawkins1 Miami 33152 Michael T. Wilson James T. Curry III Nashville 37203 James E. Dalton, Jr. Melvyn K. Purcell New Orleans 70161 Jo Ann Slaydon Robert J. Musso CHICAGO* 60690 Robert M. Healey Michael H. Moskow Richard G. Cline William C. Conrad Detroit 48231 John D. Forsyth Roby L. Sloan1 ST. LOUIS 63166 Robert H. Quenon Thomas C. Melzer John F. McDonnell James R. Bowen Little Rock 72203 Janet M. Jones Karl W. Ashman Louisville 40232 Daniel L. Ash Howard Wells Memphis 38101 Woods E. Eastland John P. Baumgartner MINNEAPOLIS 55480 Gerald A. Rauenhorst Gary H. Stern Jean D. Kinsey Colleen K. Strand Helena 59601 Matthew J. Quinn John D. Johnson KANSAS CITY 64198 Herman Cain Thomas M. Hoenig A. Drue Jennings Richard K. Rasdall Denver 80217 Sandra K. Woods KentM. Scott1 Oklahoma City 73125 Ernest L. Holloway Mark L. Mullinix Omaha 68102 Sheila Griffin Harold L. Shewmaker DALLAS 75201 Cece Smith Robert D. McTeer, Jr. Roger R. Hemminghaus Tony J. Salvaggio El Paso 79999 W. Thomas Beard III Sammie C. Clay Houston 77252 Isaac H. Kempner III Robert Smith, III1 San Antonio 78295 Carol L. Thompson James L. Stull1 SAN FRANCISCO .... 94120 Judith M. Runstad Robert T. Parry James A. Vohs Patrick K. Barron Los Angeles 90051 Anita E. Landecker John F. Moore1 Portland 97208 Ross R. Runkel Raymond H. Laurence Salt Lake City 84125 Gerald R. Sherratt Andrea P. Wolcott Seattle 98124 George F. Russell, Jr. Gordon Werkema1 * Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; East Rutherford, 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. Assistant Vice President. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis