Federal Reserve Bulletin, 1999-10

Volume 85 • Number 10 • October 1999 Federal Reserve BULLETIN Board of Governors of the Federal Reserve System, Washington, D.C. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Table of Contents 655 THE LAUNCH OF THE EURO ference available on the Internet. The introduction on January 1, 1999, of the Release of a Spanish-language version of Keys euro—the single currency adopted by eleven of to Vehicle Leasing. the fifteen countries of the European Union— Enforcement actions and terminations of previmarked the beginning of the final stage of Ecoous actions. nomic and Monetary Union and the start of a new era in Europe. The creation of a single Changes in Board staff. currency and a single monetary policy has provided both extraordinary challenges and excep- 674 MINUTES OF THE FEDERAL OPEN tional opportunities within Europe. This article MARKET COMMITTEE MEETING HELD ON reviews the organization, objectives, and targets JUNE 29-30, 1999 of the euro area's new central bank and dis- At this meeting, the Committee voted to reaffirm cusses some of the early challenges it has faced the ranges for growth of M2, M3, and total in setting and implementing monetary policy domestic nonfinancial debt that it had estabwith the new common currency. It discusses the lished in February for 1999 and to extend those initial functioning of the payment system and ranges on a tentative basis to 2000. For the the interbank market and reviews the effects to intermeeting period ahead, the Committee date of the single currency on European bond adopted a directive that called for a slight tightand equity markets, on the banking system, and ening of conditions in reserve markets consisin euro-area transactions. tent with an increase of 1/4 percentage point in the federal funds rate to an average of around 667 INDUSTRIAL PRODUCTION AND CAPACITY 5 percent. The Committee also agreed that the UTILIZATION FOR AUGUST 1999 directive should not contain any bias with Industrial production, which had increased respect to the direction of possible adjustments 0.7 percent in July, advanced 0.3 percent in to policy during the intermeeting period. August, to 135.6 percent of its 1992 average. The rate of capacity utilization for total industry 683 LEGAL DEVELOPMENTS rose 0.1 percentage point, to 80.8 percent, a level 1.3 percentage points below its 1967-98 Various bank holding company, bank service average. corporation, and bank merger orders; and pending cases. 670 ANNOUNCEMENTS A1 FINANCIAL AND BUSINESS STATISTICS Action by the Federal Open Market Committee and an increase in the discount rate. These tables reflect data available as of August 27, 1999. Nomination of Roger W. Ferguson, Jr., as Vice Chairman of the Board of Governors. A3 GUIDE TO TABULAR PRESENTATION Interim rule to Regulation DD. A4 Domestic Financial Statistics Proposed revisions to Regulation B; revised pro- A42 Domestic Nonfinancial Statistics posals to permit electronic delivery of federally A50 International Statistics mandated disclosures under five consumer protection regulations: B, E, M, Z, and DD. A63 GUIDE TO STATISTICAL RELEASES AND SPECIAL TABLES Order for currency notes for fiscal year 2000. Proceedings of a Federal Reserve research con- A66 INDEX TO STATISTICAL TABLES Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 BOARD OF GOVERNORS AND STAFF A74 MAPS OF THE FEDERAL RESERVE SYSTEM A70 FEDERAL OPEN MARKET COMMITTEE AND A76 FEDERAL RESERVE BANKS, BRANCHES, STAFF; ADVISORY COUNCILS AND OFFICES All FEDERAL RESERVE BOARD PUBLICATIONS Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

PUBLICATIONS COMMITTEE Lynn S. Fox, Chair • Jennifer J. Johnson • Karen H. Johnson • Donald L. Kohn • Stephen R. Malphrus • J. Virgil Mattingly, Jr. • Michael J. Prell • Dolores S. Smith • Richard Spillenkothen • Richard C. Stevens 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 Multimedia Technologies Center under the direction of Christine S. Griffith, and Publications Services supervised by Linda C. Kyles. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Launch of the Euro Carol C. Bertaut and Murat F. Iyigun, of the Board's 1. Comparison of the euro area and the United States Division of International Finance, prepared this Percent except as noted article. Tim Troha provided research assistance. Item Euro area United States The introduction on January 1, 1999, of the euro— Population (1997, millions) 282 268 Nominal GDP (1998, trillions of dollars) .. 6.6 8.5 the single currency adopted by eleven of the fifteen Inflation (June 1999, twelve-month percent change)' .9 2.0 countries of the European Union—marked the begin- Unemployment rate (July 1999)2 10.3 4.3 ning of the final stage of Economic and Monetary Exports as a share of GDP (1998) 33.7 11.3 Excluding intra-euro-area trade 13.5 Union and the start of a new era in Europe. This Imports as a share of GDP (1998) 31.5 13.0 Excluding intra-euro-area trade 12.1 historic achievement was the culmination of a lengthy process that began in March 1957, when six Euro- 1. Euro-area harmonized inflation is calculated from a weighted average of harmonized consumer price indexes for individual countries. The harmonized pean nations—Belgium, France, Germany, Italy, Lux- indexes are constructed by standardizing some aspects of statistical practice and embourg, and the Netherlands—signed the Treaty of eliminating categories from national consumer price indexes, leaving indexes with basically identical coverage across countries. Rome, thereby founding the European Economic 2. Euro-area unemployment estimates are based on the results of the Euro- Community (EEC).1 The Treaty came into effect on pean Community Labour Force Survey. . . . Not applicable. January 1, 1958, exactly forty-one years before the inception of the new single European currency.2 (EU) nations produced the Treaty on European Although the Treaty of Rome created a closer Union.3 economic union among member countries, these This treaty, generally referred to as the Maastricht countries did not at the time envisage an actual Treaty, became the effective "constitution" for EMU, monetary union. In 1971, a group of European exproviding the criteria for judging macroeconomic perts developed a proposal for coordinated or harmoconvergence and laying the groundwork for the evennized monetary policy among EEC members; this tual establishment of the European Central Bank.4 In proposal was made explicit in the Werner plan. Furearly May 1998, the heads of state or government ther progress toward monetary integration was set in of the fifteen EU countries agreed that eleven counmotion by the establishment in 1979 of a system of tries (Austria, Belgium, Finland, France, Germany, stable, but adjustable, exchange rates known as the Ireland, Italy, Luxembourg, the Netherlands, Portu- European Monetary System. The first major revision gal, and Spain) should move forward into the final to the Treaty of Rome was the Single European Act, stage of EMU, creating an economic area comparable signed in 1986, which affirmed old objectives and set in size to that of the United States (table 1). The new ones, including the establishment of a European European Commission of the European Union and single market and the gradual realization of monetary the European Monetary Institute evaluated each union. In 1989, specific stages toward achieving Ecocountry's readiness for entry on the basis of the nomic and Monetary Union (EMU) were detailed in the Delors Committee report, and in December 1991 in the Dutch city of Maastricht, European Union 3. For further background on the stages leading up to EMU, see Herve Carre and Karen H. Johnson, "Progress toward a European Monetary Union," Federal Reserve Bulletin, vol. 77 (October 1991), pp. 769-83; Peter Kenen, Economic and Monetary Union in Europe: Moving beyond Maastricht (Cambridge University Press, 1995), and Robert Solomon, Money on the Move: The Revolution in International 1. The Treaty of Rome was preceded in 1951 by the Treaty of Paris Finance since 1980 (Princeton University Press, 1999). to which the same six European nations were signatories; the Treaty 4. The Maastricht Treaty also provided the legal basis for the of Paris established the European Coal and Steel Community, which European Central Bank and protocols for the European System of aimed at the more-limited objective of pooling the coal and steel Central Banks (ESCB) and the European Monetary Institute (EMI). resources of member countries. The ESCB comprises the European Central Bank and the fifteen 2. Over the years, membership in the EEC, which was renamed the EU-member national central banks. The EMI was the precursor to the European Union, grew from the initial six countries to fifteen, with ECB. During its transitory existence between January 1994 and July Denmark, Ireland, and the United Kingdom becoming full members in 1998, the EMI worked to strengthen cooperation and monetary policy 1973, Greece in 1981, Spain and Portugal in 1986, and Austria, coordination among national central banks and to facilitate prepara- Finland, and Sweden in 1995. tions for the establishment of the ESCB. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

656 Federal Reserve Bulletin • October 1999 65 performance criteria for inflation, fiscal policy, long- 2. Official currency conversion rates term interest rates, and exchange rates and on the conformity of each country's national central bank Country Currency Currency units per euro legislation with the Maastricht Treaty. The European Austria schilling 13.7603 Central Bank came into formal existence on July 1, franc 40.3399 markka 5.94573 1998, and took over responsibility for the monetary France franc 6.55957 Germany mark 1.95583 policy of the EMU member states on January 1, Ireland punt .787564 1999. Italy lira 1936.27 The creation of a single currency and a single Luxembourg franc 40.3399 Netherlands guilder 2.20371 monetary policy has provided both extraordinary Portugal escudo 200.482 Spain peseta 166.386 challenges and exceptional opportunities within Europe. A new financial infrastructure was necessary SOURCE. European Central Bank. to handle transactions in the new currency. Although the euro does not yet exist as a physical currency— national central banks of the euro-area countries. bank notes and coins will not be introduced until Instead, monetary policy is determined for the euro 2002—the euro is traded in financial markets, new area as a whole by the Eurosystem. The Eurosystem issues of securities are denominated in euros, and comprises the new European Central Bank (ECB) at official statistics in the euro area are quoted in the its center as well as the national central banks of the euro (table 2). For financial firms, the creation of the eleven countries currently participating in the moneeuro required conversion of numerous existing tary union.5 The Maastricht Treaty grants the ECB accounts and systems for trading, risk analysis, and full constitutional independence. It explicitly states liquidity management to the new currency. Although that neither the ECB nor any member of its decisiondevelopment of these systems had been ongoing for making bodies shall seek or take instructions from several years, the actual switchover took place over European Commission institutions, from any governthe long "conversion weekend" from the close of ment of a member state, or from any other organizabusiness on December 31, 1998, through the opening tion or institution. The primary decisionmaking bodof business on January 4, 1999. Round-the-clock ies of the ECB are the Executive Board and the efforts in major financial centers were necessary for Governing Council. The Executive Board consists of handling the complexities of re-denominating euro- the president and vice president of the ECB and four area government bonds to the new currency, convert- other members (table 3). These members are aping financial accounts, and doing final testing of the pointed by common agreement among the governsystem for interbank payments. Now that the initial ments of EMU member states on a recommendation transition has been successfully completed, the estab- from the EU Council after consulting with the Eurolishment of the single monetary area and the removal pean Parliament. The members of the Executive of currency risk among member countries is expected Board are also members of the Governing Council, to provide unprecedented opportunities for cross- along with the governors of the national central banks border trading, portfolio expansion, and mergers and of the eleven EMU member countries. The primary acquisitions among European companies. responsibility of the Governing Council is the setting This article reviews the organization, objectives, of monetary policy within the euro area. The primary and targets of the euro area's new central bank and responsibility of the Executive Board is to implement discusses some of the early challenges it has faced in monetary policy and to issue instructions as necessetting and implementing monetary policy with the sary to the national central banks in accordance with new common currency. It discusses the initial func- the guidelines of the Governing Council. Although tioning of the payment system and the interbank required by law to meet at least ten times a year, the market and reviews the effects to date of the single Governing Council in practice meets every two currency on European bond and equity markets, on the banking system, and in euro-area transactions. 5. The ESCB includes the ECB and the national central banks from all fifteen EU member states. At the time that the Maastricht Treaty was signed, it was generally understood that all EU countries would enter into EMU at the same time, and the Maastricht Treaty refers to ORGANIZATION OF THE NEW EUROPEAN the ESCB and not the Eurosystem. The national central banks of the CENTRAL BANK AND THE EUROSYSTEM member states that do not participate in the Eurosystem are members of the ESCB but have a special status; they are allowed to conduct their respective national monetary policies, and they do not take part With the start of the final stage of EMU, monetary in the decisionmaking regarding euro-area monetary policy and its policy is no longer set individually at each of the implementation. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Launch of the Euro 657 3. Comparison of the organizational structure of the Eurosystem and the Federal Reserve System Item Eurosystem Federal Reserve System Staffing Total 53,000+ 24,500+ At headquarters 500+ 1,700+ Monetary policy decisionmaking The Governing Council The Federal Open Market Committee committee Number of members on the Seventeen: six members of the Executive Twelve: seven members of the Board monetary policy committee Board plus eleven governors of the national of Governors, plus the president of the central banks of EMU member states. Federal Reserve Bank of New York, and four of the remaining eleven regional Federal Reserve Bank presidents rotating on a two-year basis. Geographic representation No specific requirements for the six No more than one member of the Board Executive Board members. of Governors may be selected from any of the twelve Federal Reserve Districts. Meeting frequency At least ten meetings per year required At least four meetings per year required by law. In practice, bi-monthly, every by law. In practice, eight times per year. other Thursday. Publication of minutes Minutes accessible after thirty years. In Minutes released a few days after the special cases, the Governing Council may next regularly scheduled FOMC meeting. shorten this period. The president and the Lightly edited transcripts of all meetings vice president hold a press conference for a complete year released after a lag following the first Governing Council of five years. meeting of each month. Regulatory and supervisory Most of the key prudential regulations Primary responsibility for supervising responsibilities are harmonized in the EU. The primary and regulating all bank holding comparesponsibility for supervision remains at nies and their nonbank foreign subsidithe national level. European Banking aries, state-chartered banks that are Supervisory Committee of the ECB aims members of the Federal Reserve and to ensure coordinated supervision. their foreign branches, and Edge Act and agreement corporations. weeks, a schedule similar to that employed by the The ECB's published definition of price stability is German Bundesbank through December 1998. inflation, measured as the twelve-month change in the harmonized index of consumer prices for the euro area, of below 2 percent—with no explicitly defined Objectives and Targets lower bound.6 Although the ultimate goal of euro- As specified in the Maastricht Treaty, the primary area monetary policy is clearly specified as price objective of the ECB is to "maintain price stability." stability, the Governing Council of the ECB has Without jeopardizing this objective, the ECB is also adopted a flexible approach toward achieving this expected to support the general economic policies of goal. Unlike the Bundesbank, which followed a the European Commission. In this respect, the man- specific intermediate target for a broad monetary date of the ECB is similar to that of the Bundesbank. aggregate, the Governing Council would—as Wim Section 3 of the Deutsche Bundesbank Act, which Duisenberg, president of the ECB, announced in was signed into law in 1957 and later amended to October 1998—take into consideration a "reference comply with the Maastricht Treaty, names the main value" for growth of a monetary aggregate and a mix duties of the central bank as the regulation of the of other indicators defined as "a broadly-based amount of money in circulation and of credit supplied assessment of the outlook for future price developto the economy with the aim of "safeguarding the currency." In practice, safeguarding the currency was interpreted to mean price stability. In comparison, the 6. Harmonized inflation for the euro area is calculated from a Federal Reserve Act states that U.S. monetary policy weighted average of harmonized consumer price indexes for indishould seek "to promote effectively the goals of vidual countries. The harmonized indexes are constructed by standardmaximum employment, stable prices, and moderate izing some aspects of statistical practice and eliminating categories from national consumer price indexes, leaving indexes with basically long-term interest rates." identical coverage across countries. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

658 Federal Reserve Bulletin • October 1999 65 ments." 7 The relevant reference value for the central Eurosystem, the operational aspects of monetary polbank's monetary growth target, which was announced icy implementation—including open market operain December 1998 and is effective through December tions, administration of the minimum reserve system, 1999, is for areawide M3 growth of 4V2 percent, as and management of the standing facilities—are unmeasured by a three-month moving average of the dertaken in a decentralized fashion at the eleven twelve-month percent change. In January 1999, the national central banks. The main features of the Euro- ECB noted that, among other things, the mix of other system's operating procedures are similar in many indicators will include wages, bond prices, the yield respects to those employed by the Bundesbank and curve, measures of real activity, business and con- other national central banks in the euro area in recent sumer surveys, and the exchange rate.8 years (see the box "Comparison of Eurosystem To an important degree, the ECB's adoption of a Monetary Operating Procedures with Those of the flexible and pragmatic approach to monetary policy Bundesbank and the Federal Reserve System"). The was influenced by a number of transitory constraints. Eurosystem provides liquidity to the euro-area bank- During the initial stages, ECB officials were con- ing system primarily through a weekly refinancing fronted with euro-area data that at times were incom- operation with a two-week maturity.9 plete and not fully harmonized, especially regarding Beginning with its first weekly tender settled on historical data. Moreover, because national statistical January 7, the ECB has offered only fixed-rate agencies continued to publish the bulk of national tenders at its weekly refinancing operations. These statistics, there was a risk that financial markets might tenders are bids by eligible banks for credit at the pay undue attention to developments in individual interest rate specified by the ECB. The Eurosystem countries instead of those in the euro area as a whole. then allocates the amount it decides to provide among These constraints noted, the availability of timely and the bids it has received.10 Individual banks are not accurate euro-area data grew considerably in the first restricted as to the volume of their bids, and they are months of 1999. However, the "structural break" required to have sufficient collateral to cover only the associated with monetary union provided another actual amount allocated. Additional liquidity is procomplication for interpreting and projecting basic vided through longer-term monthly tenders that are economic relationships in the medium run, because conducted as variable-rate tenders with a three-month both inflation and money growth relationships rely, maturity. "Fine-tuning" operations may also be used explicitly or implicitly, on an understanding of the to make further adjustments to the amount of liquidhistorical relationship between aggregate economic ity in the market, although through June 30, no such variables and the price level. Thus, the ECB's choice operations had been undertaken. of a flexible approach to monetary policymaking was The Eurosystem also has two standing facilities to pragmatic. The need for the ECB to be flexible in the provide and absorb overnight money and to provide a short run makes its policy setting less transparent. "corridor" for the market-determined interbank rate: However, given the uncertainties about structural eco- the marginal lending facility and the deposit facility. nomic relationships during the transition, the ECB The marginal lending facility provides overnight has chosen not to specify any intermediate target—at credit to all eligible credit institutions with sufficient least, not until experience provides sufficient evi- collateral, and its interest rate usually serves as a dence that such a step would be productive. ceiling for the overnight interbank rate. There is no stigma associated with borrowing at the marginal lending facility. However, such borrowing takes place Implementation of Monetary Policy at the ECB at a penalty rate, in that the interest rate on the marginal lending facility is generally set between Although decisions regarding monetary policy are made centrally by the Governing Council of the 9. The underlying securities for the weekly refinancing operations are predominantly euro-area government bonds and notes, but they also include shorter-maturity government securities and some privatesector securities. Each week, the ECB announces the list of securities 7. For more details on Germany's use of monetary targets, see that are eligible for use in monetary operations. Linda S. Kole and Ellen E. Meade, "German Monetary Targeting: A 10. In this article, the terms bank and banking system are intended Retrospective View," Federal Reserve Bulletin, vol. 85 (October to include all euro-area credit institutions that are eligible to conduct 1995), pp. 917-31. operations with the Eurosystem. For further details, see European 8. For further information on the ECB's monetary strategy, see Central Bank, "The Single Monetary Policy in Stage Three: General "The stability-oriented monetary strategy of the Eurosystem," Euro- documentation on ESCB monetary policy and procedures" (Septempean Central Bank Monthly Bulletin (January 1999), pp. 39-51. ber 1998). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Launch of the Euro 659 100 and 150 basis points above the official weekly end of the day automatically rolls over to overnight refinancing rate. The overnight interbank rate usually lending through the marginal lending facility. trades close to the weekly refinancing rate, giving The second standing facility, the deposit facility, banks an incentive to borrow in the interbank market usually provides a floor for the interbank rate. This if possible. Intra-day credit that is not repaid by the facility is available for banks to deposit excess funds Comparison of Eurosystem Monetary Operating Procedures with Those of the Bundesbank and the Federal Reserve System EUROSYSTEM use a variable-rate tender except during periods when it wanted to provide guidance to market interest rates. Primary Operations Between February 1996 and December 1998, the Bundesbank conducted only fixed-rate tenders. The refinancing tender is a weekly repurchase operation with a two-week maturity. The tenders may be offered at Standing Facilities a fixed or variable interest rate. To date, only fixed-rate tenders have been offered at the weekly refinancing opera- Marginal Lending (Lombard) Facility. The Lombard faciltions. Allocated credit must be collateralized; eligible coun- ity was available for overnight credit from the Bundesbank terparties include all credit institutions subject to the Euro- for eligible credit institutions with sufficient collateral. The system's minimum reserve requirements that have sufficient interest rate on the Lombard facility was normally set about collateral and that satisfy the operational criteria required 150 basis points above the repo rate. No stigma was associby individual national central banks. The underlying securi- ated with borrowing at the Lombard rate, but the facility ties for the weekly refinancing operations are predomi- was not intended as a permanent source of funding. nantly euro-area government bonds and notes but also Discount Facility. Discount lending provided an addiinclude shorter-maturity government securities and some tional source of liquidity at a subsidized rate, normally set private-sector securities. Each week, the ECB announces about 100 basis points below the repo rate. Over time, the the list of securities that are eligible for use in monetary importance of the discount facility diminished; by 1996, it operations. Additional liquidity is provided through accounted for about one-third of central bank liquidity, monthly refinancing operations. These are repurchase trans- down from nearly two-thirds in the mid-1980s. actions at a three-month maturity, offered as variable-rate tenders of a fixed amount. FEDERAL RESERVE SYSTEM Standing Facilities Primary Operations Marginal Lending Facility. The marginal lending facility is In contrast to the European Central Bank, the Federal open to all eligible credit institutions with sufficient collat- Reserve System does not have an official repurchase rate at eral for overnight credit from the Eurosystem. To date, the which it provides credit to the banking system. Instead, the normal setting for the interest rate on the marginal lending Federal Reserve specifies as a target an intended level for facility is 100 to 150 basis points above the weekly refithe federal funds rate, which is the market overnight internancing rate. bank borrowing rate, and conducts open market operations Deposit Facility. The deposit facility is open to all elito influence the level of liquidity in the funds market to gible credit institutions for depositing excess funds overachieve that interest rate on average. Open market operanight. To date, the normal setting for the interest rate on the tions are conducted several times a week primarily in the deposit facility is 100 basis points below the refinancing form of variable-rate repurchase transactions of government rate. securities, with a maturity ranging from one day to ninety days. Outright transactions in Treasury bills are also occa- BUNDESBANK (before January 1, 1999) sionally used. Primary Operations Standing Facility From December 1993 through December 1998, the Bundesbank's primary monetary operations were conducted Discount Window. The discount window is a source of through weekly repurchase tenders with a two-week matu- below-market-rate borrowing; borrowing at the discount rity, using either a fixed- or a variable-rate tender. The window is normally restricted to banks that cannot obtain resulting "repo" rate was regarded as the most-important funds elsewhere at reasonable cost. official interest rate. In general, the Bundesbank tended to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

660 Federal Reserve Bulletin • October 1999 65 that earn interest, although excess funds are not auto- 1. Output gaps for selected euro-area countries, 1996-98 matically swept into it. Normally, the interest rate on the deposit facility is 100 basis points below the Percent refinancing rate. Thus, in normal times, the corridor provided by the marginal lending and deposit facilities is quite wide, at 2 percent to 2.5 percent. From January 4 through January 21, however, interest rates on the two standing facilities were set only 50 basis points apart—25 basis points on either side of the refinancing rate—to help ease distortions in the money market during the initial weeks of operations under the single currency. MACROECONOMIC BACKGROUND NOTE. The output gaps are the deviations of actual GDP from potential GDP AND RECENT ECONOMIC DEVELOPMENTS as a percentage of potential GDP. IN THE EURO AREA SOURCE. OECD Economic Outlook, June 1999. The euro came into existence in an economic environment that turned out to be less than hospitable. economic picture. Economic activity in some coun- Considerable downside risks to real economic activ- tries, such as Germany and Italy, grew at only a ity were evident around the globe in the fall of 1998, moderate pace in 1998, while the economies of some stemming mainly from the Russian financial crisis in other countries, notably Finland and Ireland, mid-1998, but also from the latter stages of the finan- expanded rapidly. These differences could be seen in cial crisis in Asia and the signs of turmoil in Latin the increasing divergence in output gaps, a measure America. At the same time, the prolonged stagna- of unused capacity in the economy (chart 1). The tion in Japan showed no signs of abating in the near differences became all the more relevant for the setterm, and in the United Kingdom—a potential future ting of monetary policy in light of the lower nominal entrant into the euro area—growth had slowed interest rates brought about by convergence of offisharply from its previous robust pace. In contrast, cial interest rates to levels prevailing in Belgium, U.S. economic activity continued to expand rapidly.11 France, Germany, and the Netherlands in the months Moreover, most European countries that were striv- leading up to January 1, 1999 (chart 2). Long-term ing to meet the criteria of the Maastricht Treaty for interest rates had largely converged by early 1998, EMU membership in the first round had undertaken bringing forward some of the benefit of EMU significant fiscal tightening in 1997, the lagged effects (chart 3). In countries in which activity was already of which, to some extent, carried over to 1998. The fiscal tightening, coupled with the negative effects of the Asian and Latin American crises on European 2. Short-term interest rates for selected euro-area countries, January 1997-March 1999 foreign trade, brought early signs of a slowdown in Europe in the last quarter of 1998—the period in Percent which final preparations for the launch of the euro were being made. Thus, given the robust pace of activity across the Atlantic, differences in cyclical Ireland economic positions set the stage for significant potential downward pressure on the exchange rate of the yet-to-be-born currency against the dollar. Cyclical differences among countries heading into the final stage added another complication to the France Germany 11. To preserve the ongoing economic expansion in the United States, the Federal Open Market Committee responded to the increasing risks associated with weakening economic activity abroad and volatile conditions in financial markets in the autumn by reducing the NOTE. The data are monthly averages. Short-term interest rates are threeintended federal funds rate a total of 75 basis points. month interbank rates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Launch of the Euro 661 3. Long-term interest rates for selected euro-area countries, 4. Exchange rate of the euro against the U.S. dollar, January 1997-August 1999 January 1996-August 1999 Percent Monthly average, dollars per euro Italy Spain — 7 — 1.3 — 6 — \ Fixing rate1 A — 1-2 France ^^ Ireland — 5 — \ A ^/ \ 1.1 — 1.0 — 4 Germany x 1 1 1 1 1 1 I 1 1 1 1 i i i i i 1 1 1 1 1 1 1 1 1 1 1 1997 1998 1999 1996 1997 1998 1999 NOTE. The data are monthly averages. Long-term rates are nominal ten-year NOTE. The data are monthly averages. The exchange rate monthly data use (or closest available maturity) government bond yields. the restated German mark before January 1999. 1. The fixing rate was set on December 31, 1998, at 1.16675 U.S. dollars per euro. robust, such as Ireland, the convergence process provided some additional marginal stimulus.12 dued, and the United States, where economic activity was still robust. The weaker euro provided some stimulus to euro-area foreign trade, although in evaluating the potential effects of the depreciation of the Recent Economic Developments and Policy euro against other major currencies, namely the U.S. Actions dollar and the U.K. pound, it is useful to note that once intra-euro-area trade is excluded, the euro-area From mid-September through the end of December economy is relatively closed compared with the indi- 1998, the currencies of the eleven euro-area countries vidual economies of the eleven countries before the appreciated significantly against those of some tradadoption of the euro (see table 1). Thus, larger moveing partners, particularly against the U.S. dollar. After ments in the value of the euro may be necessary its inauguration on January 4, 1999, however, the to affect areawide economic activity than the movenew currency depreciated fairly steadily against other major currencies. By the end of July, the exchange value of the euro against the dollar had depreciated 5. Monetary Union Index of Consumer Prices (MUICP) more than 13 percent from its initial value of for the euro area, January 1997-June 1999 1.167 dollars per euro (see chart 4); recently it has reversed some of this depreciation.13 Twelve-month percent change For the most part, the euro's steady weakening against the dollar was driven by differences in cycli- — 2.0 cal conditions between the euro area, where economic activity in the largest countries remained sub- — \ — 1.5 — V / A^ 1.0 12. In early October, central banks in Spain and Portugal reduced official rates 50 basis points, and the Central Bank of Ireland cut rates 125 basis points. The Bank of Italy waited until December 28 before — .5 cutting its official rates 50 basis points to complete the process of convergence. A coordinated interest rate reduction by all prospective 1 1 1 1 1 1 1 1 1 1 1 euro-area national central banks on December 3 provided additional 1997 1998 1999 stimulus. By January 1, the total weighted-average decline in euroarea rates that had occurred since September 1998 was about 75 basis NOTE. The data are monthly averages. The MUICP is calculated as a points. weighted average of harmonized consumer price indexes of the euro-area countries. The harmonized indexes are constructed by standardizing some 13. The fixing value of 1.16675 dollars per euro was determined by aspects of statistical practice and eliminating categories from national consumer the value of the dollar-ECU exchange rate on December 31, 1998. price indexes, leaving indexes with basically identical coverage across coun- However, when European financial markets opened on January 4, tries. Country weights are calculated every year from the country's share of 1999, the euro traded at 1.1789 dollars per euro, an appreciation of private final domestic consumption expenditure in the euro-area total (from about 1 percent relative to its fixing rate. Eurostat). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

662 Federal Reserve Bulletin • October 1999 65 6. Harmonized M3 growth for the euro area, 7. Eurosystem interest rates, January-August 1999 January 1997-June 1999 I Percent Three-month moving average - 4.5 - 4.0 — — 7 Marginal lending rate - 3.5 — — 6 • •<! . i eonia1 3.0 I p J L — — "Y 2.5 — 5 2.0 Deposit rate 1.5 ECB reference 4 value Refinancing rate 1.0 .5 — 3 I I I Jan. Feb. Mar. Apr. May June July Aug. 1 1 1 1 1 1 1 1 1999 1997 1998 1999 NOTE. The data are monthly averages. NOTE. The data are monthly averages. Euro-area harmonized series are 1. Euro overnight index average. compiled by the European Central Bank based on monthly reporting by monetary financial institutions in each country. officials faced challenges in ensuring that monetary ments that had to occur for national currencies to policy was implemented smoothly and effectively affect their respective national economies. throughout the Eurosystem. Early in 1999, overnight At its meeting on April 8, the Governing Council market interbank rates in the euro area, as measured of the ECB responded to the emerging evidence of by the euro overnight index average (eonia), traded weaker activity in the euro area by cutting official close to the official marginal lending rate, suggesting interest rates. The Governing Council reduced the some interbank liquidity strains (chart 7). Also, refinancing rate 50 basis points, to IVi percent, which according to ECB President Duisenberg, the spread was more than market participants had expected, and also cut the marginal lending rate and deposit rates 100 basis points and 50 basis points, respectively, to 8. Daily use of Eurosystem standing facilities, 3V2 percent and IV2 percent. These actions marked January-August 1999 the first change in the policy stance by the ECB, although official interest rates had been reduced to Billions of euros 3 percent last December by the national central banks of prospective members of the Eurosystem. The moves were made possible to a significant extent by the lack of price pressures in the euro area, as consumer price inflation remained well below the ECB's official ceiling of 2 percent (chart 5). Although euroarea M3 growth hovered around 5 percent on a twelve-month basis, slightly above the ECB reference value of 4V2 percent for M3 growth (chart 6), the Governing Council noted that these developments likely reflected the unwinding of special factors relating to the start of EMU and consequently did not consider them to be a signal of future inflationary developments. Early Developments in Money Markets Besides the challenges of determining the appropriate monetary stance for the euro area as a whole in the uncertain environment of early 1999, Eurosystem 1999 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Launch of the Euro 663 between interbank rates in different countries was linking, to each other. Some of the distortions that larger than should be considered normal for a single arose in the money market during the first few currency area: The spread was as much as 21 basis weeks reflected "teething problems" with TARGET, points on January 4; by January 18, however, it had as noted by ECB President Duisenberg. Payments narrowed to less than 10 basis points. Initially, the occasionally were incorrectly routed or otherwise use of both standing facilities, especially that of the mishandled and subsequently rejected by TARGET, marginal lending facility, was high (chart 8). In part, and resulting positions at the relevant banks were the unusually heavy use of the marginal lending often not resolved until the end of the day, requiring facility likely reflected the relatively high cost of the banks to resort to the automatic conversion of funds in the interbank market as well as some start-up intraday drafts to overnight loans at the marginal difficulties with the Eurosystem's wholesale payment lending facility. In response to some of these paysystem. Heavy use of the deposit facility also indi- ment system difficulties, TARGET settlement was cated payment system problems. As these difficulties extended an hour each day for most of January, but a have been resolved, use of the marginal lending penalty was imposed to discourage late settlement.15 facility and the deposit facility has decreased, and the Overall, the functioning of TARGET as an EU-wide overnight rate has generally traded close to the refi- payment system has been quite successful: In the first nancing rate, with major deviations only at the ends quarter of 1999, it processed a daily average of more of reserve maintenance periods. than 150,000 transactions valued at 966 billion euros ($863 billion).16 DEVELOPMENTS IN EUROPEAN FINANCIAL SYSTEMS AND MARKETS Securities Settlement Systems Wholesale Payment Systems In contrast to the relatively quick establishment of a wholesale payment system to handle a large volume One of the biggest challenges for the successful of cross-border transactions, the consolidation of seimplementation of monetary policy under the single curities settlement systems remains limited. Most currency was the creation of a wholesale payment systems serve only their domestic securities markets, system that would enable transactions to be con- with multiple systems existing within some countries. ducted quickly and efficiently across borders and Differences across the euro area in legal arrangewould facilitate integration of money markets in the ments applying to securities holdings and transaceuro area. Since January, the majority of the domestic tions have also made integration of securities settleand cross-border euro payments have been sent ment systems more difficult. To help compensate for through the TARGET (Trans-European Automated inadequacies in market structures and to ensure that Real-time Gross-settlement Express Transfer) sys- all banks in the euro area have equal access to elitem. TARGET consists of a real-time gross settle- gible collateral when borrowing from the national ment (RTGS) system for funds transfer in each of the central banks (NCBs), the Eurosystem has estabfifteen EU countries (including the EU countries not lished a system to transfer securities through the currently participating in EMU), the ECB's payment so-called Correspondent Central Bank Model. Under mechanism, and an interlinking among all the compo- this arrangement, a bank in one country may pledge nent systems.14 securities eligible for collateral but held in another Credit institutions in member countries may obtain country by arranging for those securities to be transcentral bank credit only from the national central ferred to a custodial account at the NCB of that bank in the country in which they are based, but they country and notifying the home NCB of its intent. may use TARGET to conduct interbank operations Once the home NCB receives acknowledgment from across the EU area. About 5,000 credit institutions the custodial NCB that the securities transfer is comhave direct access to one of the fifteen euro RTGS systems in the EU and, through the TARGET inter- 15. For further details on TARGET and developments in wholesale payment and securities settlement systems, see Bank of England, Practical Issues Arising from the Euro (June 1999). im Alternative payment systems include non-RTGS German and 16. By way of comparison, over the same period, the Federal French systems, which run frequent batch settlements throughout the Reserve System's Fedwire service, available to approximately 10,000 day, and the EU-wide Eurol system run by the Euro Banking Associa- U.S. depository institutions, processed a daily average of more than tion, which is an end-of-day, multilateral net settlement system. 400,000 funds transfers with a daily average value of $1,343 billion. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

664 Federal Reserve Bulletin • October 1999 65 plete, it authorizes the credit. However, increasing 4. Sovereign credit ratings and government bond spreads integration of European capital markets and greater for euro-area countries demand for cross-border securities trading and settle- SSpprreeaadd oovveerr ment are expected in time to lead to an integrated Credit rating, GGeerrmmaann European securities settlement system. In particular, long-term debt lloonngg--tteerrmm ggoovveerrnnmmeenntt CCoouunnttrryy the Eurosystem has encouraged the development of bboonnddss Standard & ((bbaassiiss ppooiinnttss,, links among securities settlement systems. Twenty- Moody's Poor's JJuunnee 11999999 six links already allow for transfers of securities from aavveerraaggee)) one system to another, and further links and other Austria Aaa AAA 18 Aal AA+ 28 projects to integrate the securities settlement struc- Finland Aaa AA+ 22 ture are under development.17 France Aaa AAA 11 Germany Aaa AAA Ireland Aaa AA+ 23 Italy Aa3 AA 26 Luxembourg Aaa AAA 1 Debt Markets Netherlands Aaa AAA 15 Portugal Aa2 AA 28 Spain Aa2 AA+ 25 To date, debt markets have reacted favorably to the new currency.18 The value of new issues of euro- . . . Not applicable. denominated international bonds and notes accounted for about 38 percent of all new international bonds in some differentials remain, reflecting differences the first two quarters of 1999.19 The share is consideracross member countries in credit ratings and market ably larger than in 1998, when new issues of internaliquidity (table 4). The introduction of the single tional bonds denominated in the eleven national currency has led to competition for "benchmark" legacy currencies and the ECU accounted for about status among euro-denominated bonds.21 At the mo- 27 percent of all new international issues.20 Of all ment, ten- and thirty-year German government bonds new issues denominated in the euro, most are domesare emerging as the euro benchmark issues, although tic bonds issued by euro-area governments. Although some market firms use French government securities yields on long-term government bonds of the memfor reference at shorter maturities. ber countries continued to converge through 1998, In general, European corporate debt markets are less developed than those in the United States, and corporate financing is more heavily weighted toward 17. Some of the legal issues surrounding securities transactions bank financing. Corporate debt markets account for should be clarified by the Settlement Finality Directive, due to be only about 26 percent of corporate financing in the implemented by all EU members by December 1999. This directive EU area, compared with 68 percent in the United addresses systemic risk in payment and settlement systems primarily, but it also covers some legal aspects of cross-border use of collateral. States. Creation of the single currency area appears to 18. For further details on developments in euro-area debt and be helping development of this sector, with recent equity markets, see Bank of England, Practical Issues Arising from increases in issuance of less-than-AA-grade bonds, the Euro (June 1999) and European Central Bank, "The international role of the euro," European Central Bank Monthly Bulletin (August especially in the second quarter, although issuance of 1999), pp. 32-53. so-called junk bonds remains uncommon.22 19. New issues of U.S. dollar-denominated bonds accounted for Financing of heavy merger and acquisition activalmost half of all new international issues in the first two quarters of 1999, a share slightly lower than that in 1998. Conclusions about the ity, brought about in large part by the cross-border relative shares of euro- and U.S. dollar-denominated new issues are opportunities provided by EMU, has also led to influenced importantly by the definitions of bonds included in the increased corporate issuance, while low bond yields comparison. The definition used in this article includes issues denominated in a currency other than that of the country in which the in the first half of the year made bond issuance borrower resides, and issues in domestic currency where the targeted especially attractive. The introduction of the euro has investor resides outside the country of the issuer's residence. For also benefited the German Pfandbriefe market for further details, see Bank for International Settlements, Quarterly "secured" asset-backed bonds issued primarily by Review: International Banking and Financial Market Developments (August 1999). banks and mortgage institutions. Jumbo issues of 20. The official ECU was a weighted market basket of twelve EU currencies established in connection with the EMS. The composition of the basket was fixed in January 1994, and currencies of countries that joined the EU subsequent to January 1994 (the Austrian schilling, the Finish markka, and Swedish krona) were not included in the ECU. 21. Benchmark bonds are traditionally of very high credit quality Thus, the ECU currency basket included nine euro-area currencies as and are easily and widely traded. They tend to be larger issues, which well as the British pound, the Danish kroner, and the Greek drachma. are usually more liquid at any given maturity. On January 1, 1999, holdings of the official ECU were converted one 22. Junk bonds are bonds rated BB+ or lower by Standard and for one to the euro. Poor's or Bal and lower by Moody's. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Launch of the Euro 665 more than a billion euros have become more com- Most of these merger and acquisition activities mon, and the distribution is much wider than it was involved relatively small institutions, such as savings previously. Foreign investors are increasingly active banks, credit cooperatives, and mutual banks. More in this market; they hold 15 percent to 20 percent of recently, however, merger and acquisition activity the total outstanding in these jumbo bonds and have involving larger institutions has become increasingly increased their investment in recent issues. important, and from the 1991-94 period to the Among nondomestic currency issues, European 1995-98 period, the average value of merger and countries outside the EU accounted for many of acquisition transactions increased almost tenfold. the new euro-denominated issues in the first quarter Although bank mergers in the larger continental of 1999. More recently, several emerging-market European countries continue to occur primarily governments have substantially increased euro- within national boundaries, cross-border bank acquidenominated issues, especially in the second quarter, sitions between banks in geographically close counreflecting higher yields and more volatility in the tries have become more common in the past four dollar market. In early July, Brazil successfully years. Intra-European transactions have been underlaunched a sizable euro-denominated issue, and taken mainly in the Nordic and Benelux countries, Argentina indicated that for the remainder of the leading to the emergence of regional banking markets year, it did not intend to issue debt in U.S. dollars and in these areas. In addition, several cross-border purwould turn instead to the euro market. chases of equity holdings in banks have recently occurred: Large Dutch, German, and French banks have purchased important stakes in large Spanish and Equity Markets Italian banks. Although less spectacular than recent large acquisitions within some countries, these pur- Early indications are that EMU is also serving as a chases signal further steps toward the integration of catalyst for changes in equity markets. Traditionally, European banking. divergence has been considerable across the euro Such developments in European banking have been area in the mix of bonds versus equities in institudriven by several fundamental forces of change that tional portfolio allocations, with a relatively low averswept through the international financial system, age share for equities of less than 10 percent in including financial liberalization, technological Germany and a considerably higher share, of about advances, and global diversification of savings and 50 percent, in other euro-area countries such as the investment portfolios. These factors are likely to con- Netherlands. Surveys suggest that European fund tinue to reshape banking in Europe. The final stage of managers intend to rebalance portfolios or redirect European economic and monetary union, which has new flows of funds, in terms of both the bond-equity already helped raise the potential profitability of split and geographic diversification. Increasing intereconomies of scale and scope across Europe, is likely est in Europe-wide investment opportunities has led to lead to further structural changes and more competo a proliferation in equity indexes in the past couple tition in the banking sector. of years, both in euro-area indexes and in "Pan- European" indexes that also include Swiss and U.K. companies; however, as yet no index has emerged as a clear benchmark. USE OF THE EURO FOR TRANSACTIONS AND AS A RESERVE CURRENCY Developments in European Banking Euro-area countries expect to circulate eurodenominated notes and coins beginning January 1, Most of the developments in banking in the euro area 2002. Until then, and for six months following that have taken the form of consolidation within indi- date, national currencies will continue to circulate as vidual euro-area countries, and from the mid-1980s, legal tender. Because the euro does not yet exist in the number of European credit institutions declined physical form, it can be used only for noncash transsubstantially. Between 1985 and 1997, for example, actions. However, prices may be quoted in euros, and the number of banks declined 24 percent in Germany, cash transactions can be conducted in the national 38 percent in France, 40 percent in Spain, and 19 per- currencies using the official convergence rates cent in Italy.23 (table 2). In the current transition period before the introduction of euro currency, businesses are encouraged to quote prices in both the national currency and 23. By way of comparison, the number of banks decreased 37 pereuros. Surveys suggest that the current use of euro cent in the United States during the same period. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

666 Federal Reserve Bulletin • October 1999 65 pricing remains limited and that considerable differ- In private-sector use, the dollar remains the preences exist across countries. For example, Dun and eminent currency in international financial transac- Bradstreet in April 1999 found that only about 30 per- tions. The Bank for International Settlements triencent of the 2,040 businesses surveyed in the euro area nial central bank survey in 1998 of foreign exchange responded that they had started quoting prices in and derivatives market activity reports that a signifieuros, ranging from a high of about 40 percent in cant majority (87 percent) of "traditional" foreign Luxembourg and Austria to only about 10 percent exchange transactions involved exchanges of U.S. in Portugal. A majority of businesses responded that dollars for another currency.26 they planned to begin pricing in euros by the end of Use of the deutsche mark accounted for about 2000, but few expected to be pricing solely in euros 30 percent of "traditional" transactions. In the before 2002. Anecdotal evidence suggests that dual smaller, but rapidly growing, over-the-counter derivapricing is more prevalent in the financial sector and at tives market, transactions involving the deutsche the retail level. mark grew especially quickly in recent years. The creation of a single European currency has led Because many of these transactions were between the to speculation that the euro could eventually chal- deutsche mark and other euro-area legacy currencies, lenge the U.S. dollar in importance as an international it is difficult to infer from these statistics the current reserve currency. In terms of official reserves, at the importance of the euro in international financial end of 1998 the U.S. dollar accounted for about transactions. 60 percent of total official holdings of foreign Over time, the use of the euro as a means of exchange. Holdings of the legacy currencies of the making international payments may well increase. euro-area countries accounted for about 14 percent, For example, with the introduction of euro notes and with the single largest share of such currency hold- coins in 2002, residents of countries with emerging ings in the deutsche mark. About 1 percent of financial markets that currently conduct financial reserves were also held in market instruments de- transactions using the U.S. dollar may begin to use nominated in the ECU.24 Although no comprehensive the euro instead, especially in countries that are near details are currently available on total official hold- the euro area and that trade more extensively with the ings of the euro so far this year, the share of the euro euro area than with the United States. Recent develin total official holdings has probably declined rela- opments in European financial markets are also tive to the share held in the legacy currencies and in encouraging for the euro's future prospects as a ma- ECUs. A significant portion of official reserves held jor international currency. As euro-area markets in these currencies, primarily in the deutsche mark, become more fully integrated, the euro is likely to was held by other euro-area NCBs, and with the play an increasing role in international financial conversion of these assets to the euro, they are no transactions. • longer classified as foreign exchange reserves. However, holdings of the euro currently account for about half of U.S. official reserves and are an even larger share in the official foreign exchange portfolios of some nonparticipating EU countries, such as the United Kingdom.25 24. On December 31, 1998, the Eurosystem converted into gold and U.S. dollars the official ECUs that had been issued to EU central banks through revolving swaps in exchange for 20 percent of their gross gold holdings and U.S. dollar reserves. Such ECUs amounted to about 4 percent of international official reserves at the end of September 1998. 25. For details on the currency composition of U.S. official foreign 26. To some extent, this figure is inflated by the rise in the exchange reserves, see Laura F. Ambroseno, "Treasury and Federal exchange value of the dollar in recent years. In constant-dollar terms, Reserve Foreign Exchange Operations," Federal Reserve Bulletin, the dollar's role on one side of foreign exchange transactions still vol. 85 (September 1999), pp. 616-20. For details on U.K. official remains slightly above 75 percent of all transactions. For further foreign exchange reserves, see the U.K. Treasury press release, "Quar- details on the survey, see Bank for International Settlements, "Central terly Report on UK Official Holdings of Foreign Currency and Gold: Bank Survey of Foreign Exchange and Derivatives Market Activity April-June 1999." 1998" (May 1999). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

667 Industrial Production and Capacity Utilization for August 1999 Released for publication September 16 in the summer, fell back as temperatures returned to more normal levels. At 135.6 percent of its 1992 Industrial production, which had increased 0.7 per- average, industrial production in August was 2.5 percent in July, advanced 0.3 percent in August. A surge cent higher than in August 1998. The rate of capacity in the production of motor vehicles and parts utilization for total industry rose 0.1 percentage point, accounted for the bulk of the advance. The output of to 80.8 percent, a level 1.3 percentage points below electric utilities, which had moved up sharply earlier its 1967-98 average. Industrial production and capacity utilization Ratio scale, 1992 = 100 Percent of capacity Industrial production y'^Ou- CCaappaacciittyy uuttiilliizzaattiioonn 113300 120 85 Manufacturing^/^ Total industry A/*\k Total industry tL itF CLAA vV\ y\ 110 80 f VV / A / ^* Manufacturing 100 T 1 1 1 1 1 1 1 1 1 1 i i i i i i i i i i i i 1990 1992 1994 1996 1998 1988 1990 1992 1994 1996 1998 Industrial production, market groups Ratio scale, 1992 = 100 Ratio scale, 1992 = 100 — Consumer goods 145 — Intermediate products - - 135 ./V^ ' — Durable ~ 125 t - 115 105 Nondurable 95 V i i i i i i i i i Ratio scale, 1992 = 100 Equipment 175 — — 160 - yS 145 — Business 130 — - 115 - 100 85 Defense and space N 1 1 1 1 1 1 1 1 1 1 1990 1992 1994 1996 1998 1990 1992 1994 1996 1998 All series are seasonally adjusted. Latest series, August. Capacity is an index of potential industrial production. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

668 Federal Reserve Bulletin • October 1999 65 Industrial production and capacity utilization, August 1999 Industrial production, index, 1992 = 100 Percentage change CCCaaattteeegggooorrryyy 11999999 19991 AAuugg.. 11999988 ttoo May' June' Julyp Aug.' May' June' JulyP Aug.' AAuugg.. 11999999 Total 134.0 134.2 135.2 135.6 .2 .2 .7 .3 2.5 Previous estimate 134.0 134.2 135.1 .2 .1 .7 Major market groups Products, total2 125.8 125.6 126.0 126.4 .2 -.1 .3 .4 1.2 Consumer goods 115.6 115.9 115.7 116.6 .1 .2 -.2 .8 .4 Business equipment 171.4 170.8 172.3 172.7 .5 -.4 .9 .2 3.7 Construction supplies 132.1 131.4 132.8 131.9 .0 -.6 1.1 -.6 3.0 Materials 147.3 148.2 150.4 150.8 .2 .6 1.5 .3 4.5 Major industry groups Manufacturing 138.4 138.5 139.3 139.9 .3 .1 .6 .4 3.2 Durable 165.0 165.6 167.7 168.9 .5 .4 1.2 .7 5.7 Nondurable 111.7 111.3 111.1 111.2 -.1 -.4 -.1 .1 -.1 Mining 97.9 97.7 98.6 99.2 -.4 -.2 .9 .6 -4.4 Utilities 115.4 117.6 120.4 118.4 -.4 2.0 2.3 -1.6 -1.5 Capacity utilization, percent 1998 1999 Average, Low, High, 1967-98 1982 1988-89 Aug. Mayr June1 Julyf Aug/ Total 82.1 71.1 85.4 82.0 80.4 80.3 80.7 80.8 3.9 Previous estimate 80.4 80.3 80.7 Manufacturing 81.1 69.0 85.7 80.7 79.5 79.4 79.6 79.8 4.3 Advanced processing 80.5 70.4 84.2 79.9 78.6 78.4 78.6 78.9 5.2 Primary processing . 82.4 66.2 88.9 83.1 82.5 82.4 82.8 82.7 2.3 Mining 87.5 80.3 88.0 86.3 80.8 80.5 81.2 81.7 1.1 Utilities 87.4 75.9 92.6 95.1 90.8 92.5 94.6 93.1 .6 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. MARKET GROUPS heavy trucks largely offset gains in the production of automobiles and light trucks for business use, infor- The output of consumer goods rose 0.8 percent after mation processing equipment, and farm equipment. having eased a bit in July. The output of durable Despite the upturn, the level of farm equipment proconsumer goods increased 3.2 percent as the produc- duction remains depressed. tion of automotive products, which had dropped The production of construction supplies fell 4.6 percent in July, surged 8.1 percent. In contrast, 0.6 percent, reversing part of the July gain. So far this the production of other consumer durables, which quarter, the output of construction supplies is running had risen 2.0 percent in July, declined 0.6 percent, a little above the elevated pace of the first half of the with the output of household appliances falling back. year. The output of materials increased 0.3 percent Even with this decline, the production of appliances after having risen 2 percent over June and July. remained at a high level, up nearly 5 percent from a The growth in the output of durable goods materials year earlier. The production of nondurable consumer slowed, to 0.5 percent, down from 2.2 percent in goods was unchanged in spite of a 1 percent decline July; growth in this sector so far this year has largely in the production of energy products; the output of been fueled by the strong production of parts for non-energy products, which had been trending motor vehicles and high-tech equipment, as well slightly downward, turned up a bit. as a recent pickup in steel production. The output of The production of business equipment, which had nondurable goods materials remained sluggish, risen nearly 1 percent in July, advanced 0.2 percent while the production of energy materials declined further. Declines in the output of industrial equip- 0.3 percent, after having risen more than 1 percent in ment, civilian transport aircraft, and medium and July. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Industrial Production and Capacity Utilization 669 INDUSTRY GROUPS capacity, capacity utilization, and industrial use of electric power. The revisions will begin with 1992 Manufacturing output advanced 0.4 percent, a and will incorporate updated source data for more slightly slower rate than in July. Excluding motor recent years. vehicles and parts, the gain in August was only This regular updating of source data for IP will 0.2 percent, down from 0.7 percent in July. The include some annual data from the Bureau of the 0.7 percent gain in the output of durables was led by Census's 1997 Census of Manufactures and from gains at makers of light vehicles, computers, and selected editions of its 1998 Current Industrial semiconductors. The output indexes for commercial Reports. Annual data from the U.S. Geological Suraircraft and parts, lumber, and instruments declined vey on metallic and nonmetallic minerals (except noticeably. The production in nondurable manufac- fuels) for 1997 and 1998 will also be introduced. The turing edged up after having declined in the preced- updating will also include revisions to the monthly ing three months. Among nondurables, some recov- indicator for each industry (either physical product ery in chemicals, paper, and printing and publishing data, production-worker hours, or electric power usoffset some easing in the other sectors. On balance, age) and revised seasonal factors. In addition, the the output of nondurables has changed little over the revision will introduce improved measures of producpast year. tion for selected series. Capacity and capacity utilization will be revised to The factory operating rate edged up to 79.8 perincorporate preliminary data from the 1998 Survey of cent, as an increase in advanced-processing industries Plant Capacity of the Bureau of the Census. The was partially offset by a small decline in the rate for statistics on the industrial use of electric power will primary-processing industries. With the strong gain incorporate additional information received from in light-vehicle production, capacity utilization for utilities for the past few years and may include some motor vehicles and parts jumped 3.6 percentage data from the 1997 Census of Manufactures. points, to 85.3 percent, its highest level since January 1995. Once the revision is published, it will also be made available on the IP area of the Board's web site, The operating rate at utilities, which had risen over http://www.federalreserve.gov/releases/gl7, and on June and July to 94.6 percent, fell back to 93.1 perdiskettes from Publications Services (telephone 202cent. The operating rate for mining rose for a second 452-3245). The revised data will also be available month, to 81.7 percent. With the continuing recovery through the STAT-USA web site of the Department of in oil and gas well drilling as well as a further Commerce (http://www.stat-usa.gov). Further inforincrease in coal mining, mining production increased mation on these revisions is available from the 0.6 percent in August after a 0.9 percent gain in July. Board's Industrial Output Section (telephone 202-452-3197). • REVISION OF INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION In November the Federal Reserve will publish revisions to its measures of industrial production (IP), Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

670 Announcements ACTION BY THE FEDERAL OPEN MARKET Roger W. Ferguson, Jr. to serve as Vice Chair of the Board of Governors for the Federal Reserve System. COMMITTEE AND AN INCREASE IN THE Dr. Roger W. Ferguson, Jr. was appointed to the Federal DISCOUNT RATE Reserve Board in November of 1997. Prior to that appointment, Dr. Ferguson was a partner at McKinsey & Com- The Federal Open Market Committee on August 24, pany, Inc., an international management-consulting firm. 1999, voted to raise its target for the federal funds He was based in New York City, where he managed a rate by 25 basis points to 5XA percent. In a related variety of studies for financial institutions from 1984- 1997. From 1981-84, Dr. Ferguson was an attorney at the action, the Board of Governors approved a 25 basis New York City office of Davis Polk & Wardwell, where point increase in the discount rate to AVA percent. he worked with commercial banks, investment banks With financial markets functioning more normally, and Fortune 500 corporations on syndicated loans, public and with persistent strength in domestic demand, offerings, mergers and acquisitions, and new product development. foreign economies firming and labor markets remain- Dr. Ferguson received a B.A. magna cum laude in ecoing very tight, the degree of monetary ease required nomics in 1973, a J.D. cum laude 1979, and a Ph.D in to address the global financial market turmoil of last economics in 1981, all from Harvard University. In fall is no longer consistent with sustained, noninfla- 1973-74 Dr. Ferguson was Frank Knox Fellow at Pemtionary, economic expansion. broke College, Cambridge University. Today's increase in the federal funds rate, together The Federal Reserve System's primary function is the formulation of monetary policy. The System consists of a with the policy action in June and the firming of seven member Board of Governors with headquarters in conditions more generally in U.S. financial markets Washington, D.C. and twelve Reserve Banks located over recent months, should markedly diminish the in major cities throughout the United States. In addition risk of rising inflation going forward. As a conse- to monetary policy responsibilities, the Federal Reserve quence, the directive the Federal Open Market Com- Board has supervisory and regulatory responsibilities over various banking organizations and plays a key role in mittee adopted is symmetrical with regard to the assuring the smooth functioning and continued developoutlook for policy over the near term. ment of the nation's payments systems. In taking the discount rate action, the Federal Reserve Board approved requests submitted by the Governor Ferguson issued the following statement on Boards of Directors of the Federal Reserve Banks of August 6, 1999: Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Kansas City, and I am delighted to have been nominated by the President to serve as Vice Chairman of the Federal Reserve Board. San Francisco. Subsequently, the Board approved During my tenure at the Board, I have been engaged in a similar actions by the board of directors of the wide range of policy matters and enjoyed immensely work- Federal Reserve Bank of Minneapolis, effective ing with Chairman Greenspan and our colleagues. I wel- August 25, 1999, and by the board of directors of the come this opportunity to expand my role in this vital Federal Reserve Bank of Dallas, effective August 26, institution. 1999. The discount rate is the interest rate that is charged depository institutions when they borrow Chairman Alan Greenspan of the Federal Reserve from their District Federal Reserve Banks. Board on August 6, 1999, issued the following statement: ROGER W. FERGUSON, JR.: NOMINATION In selecting Roger Ferguson for the position of Vice Chair- AS VICE CHAIRMAN OF THE BOARD man, President Clinton has chosen a person highly respected by his colleagues. OF GOVERNORS OF THE FEDERAL Governor Ferguson is an outstanding public servant, RESERVE SYSTEM with broad experience and sound judgment. I look forward to working with him in this new role upon his confirmation The White House Office of the Press Secretary issued by the Senate. the following press release on August 6, 1999: Federal Reserve Board member Edward W. The President today announced his intent to nominate Kelley, Jr. on August 6, 1999, issued the following Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

671 statement on the nomination of Governor Roger W. tions B, M, Z, and DD to permit financial institutions Ferguson, Jr. as Vice Chairman: and others to send electronic disclosures if the consumer agrees, with few other requirements. Disclosures may be sent to the consumer's e-mail address or I strongly support the nomination of Roger Ferguson to be posted on a web site. Vice Chairman of the Federal Reserve Board. We have In response to comments, the Board on August 18 worked together very closely since his arrival here. He has made important contributions to all of the various compo- approved the publication of revised and more comnents of our activities and his contributions will be prehensive proposals, together with proposed comenhanced when he becomes Vice Chairman. mentary that would provide guidance on electronic communication. The interim rule to Regulation E Governor Kelley, appointed in 1987, is the longestremains in effect. serving member of the Board. ORDER FOR CURRENCY NOTES REGULATION DD: INTERIM RULE FOR FISCAL YEAR 2000 The Federal Reserve Board on August 31, 1999, The Federal Reserve Board announced on August 13, published an interim rule to Regulation DD, which 1999, that it had ordered nine billion currency notes, implements the Truth in Savings Act. The rule per- with a face value of $67 billion, for fiscal year 2000. mits depository institutions to deliver disclosures on The order, sent to the Treasury Department's periodic statements to a consumer's e-mail account Bureau of Engraving and Printing, represents a return or post them on a web site if the consumer agrees. to historical ordering patterns. Last year, the Board The interim rule was effective September 1, 1999. ordered eleven billion notes worth $267 billion to Under an earlier interim rule published by the meet normal business needs and to prepare for the Board in March 1998, periodic statements and other possibility of increased demand around the year 2000 disclosures required under Regulation E (which rollover. implements the Electronic Fund Transfer Act) may The face value of the new order is considerably be delivered electronically if the consumer agrees. smaller than that of the previous year because the Institutions commonly provide a single periodic state- Board decided not to print additional $50 and ment that complies with Regulations E and DD. $100 notes. The inventory of larger notes is sufficient Therefore, this interim rule for Regulation DD, to meet anticipated demand over the next federal approved by the Board on August 18, should allow fiscal year, which begins October 1. In last year's depository institutions to deliver deposit account order, the Board aimed for an increase in inventory statements electronically under a single set of proce- because even though it expects the full variety of dures and avoid the cost of printing and mailing the payment options to work during the rollover, it wants information. the public to have confidence in the availability of cash. "Because of increasing confidence in the readiness of the financial infrastructure, we do not antici- PROPOSED ACTIONS pate extraordinary demand for cash. Nevertheless, we have taken all the appropriate steps to make sure it is The Federal Reserve Board on August 4, 1999, pub- available if the public wants it," said Governor lished proposed revisions to Regulation B, which Edward W. Kelley, Jr. implements the Equal Credit Opportunity Act. Com- While currency inventory levels depend on flows ments are requested by November 10, 1999. into and out of Reserve Banks from the nation's The Federal Reserve Board on August 31, 1999, depository institutions and on the destruction rate of requested comment on revised proposals to permit worn-out bills, the Board expects by year-end to have electronic delivery of federally mandated disclosures well over $200 billion in Reserve Bank vaults. That's under five consumer protection regulations: B (Equal more than enough to replace all of the approximately Credit Opportunity), E (Electronic Fund Transfers), $170 billion in currency circulating in the United M (Consumer Leasing), Z (Truth in Lending), and States. DD (Truth in Savings). Comments are requested by The Board expects inventory levels to decrease October 29. gradually next year as replacement currency enters In March 1998, the Board had published an interim circulation, and the Bureau of Engraving and Printing rule to Regulation E and proposed changes to Regula- delivers fewer notes. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

672 Federal Reserve Bulletin • October 1999 65 PROCEEDINGS OF A FEDERAL RESERVE • Know your rights and responsibilities (Conozca RESEARCH CONFERENCE AVAILABLE ON THE sus derechos y responsabilidades) INTERNET A sample consumer leasing form (muestra del formulario de arrendamiento para el consumidor) is The Federal Reserve System on August 6, 1999, included in the brochure so consumers can become published on the Internet the proceedings of a more familiar with the document. research conference, Business Access to Capital and Copies of both the English and Spanish versions of Credit, held March 8-9, 1999, in Arlington, Virginia. the brochure are available by contacting the Federal Economists and scholars presented papers at the Reserve Board's Publications Services, Mail Stop conference, which was sponsored by the System's 127, Washington, DC 20551 (202-452-3245). The Community Affairs officers. Topics included access first 100 copies are free of charge. Additional inforto credit for minority-owned businesses, microenter- mation on leasing is available on the Board's pubprise lending, and credit scoring and securitization of lic web site at http://www.federalreserve.gov/pubs/ small business loans. Federal Reserve Board Chair- leasing/ man Alan Greenspan presented the keynote address, and Edward M. Gramlich, a member of the Board of Governors, delivered a luncheon address. ENFORCEMENT ACTIONS AND TERMINATIONS The conference proceedings—including a sum- OF PREVIOUS ACTIONS mary, final versions of fifteen working papers, and The Federal Reserve Board on August 9, 1999, commentary—are available through the web sites of announced the issuance of an order of prohibition and the Federal Reserve Board and the Federal Reserve order to cease and desist against Craig J. Fahrner, a Bank of Chicago at respectively: http://www. former institution-affiliated party of the Hinsbrook federalreserve.gov/community.htm/ and http://www. Bank and Trust, Willowbrook, Illinois. chi.frb.org/cedric/cedric .html/ Mr. Fahrner, without admitting to any allegations, The next research conference, Changing Financial consented to the order due to his alleged embezzle- Markets and Community Development, will be held ment of bank funds. in spring 2001 in Washington, D.C. A call for papers is planned for fall 1999. The Federal Reserve Board on August 11, 1999, announced the execution of a written agreement by and between Belmont Bancorp, Bridgeport, Ohio, and the Federal Reserve Bank of Cleveland. RELEASE OF A SPANISH-LANGUAGE VERSION OF KEYS TO VEHICLE LEASING The Federal Reserve Board on August 20, 1999, announced the issuance of a consent order to cease The Federal Reserve Board on August 19, 1999, and desist against the American Bank, Wichita, Kanannounced the release of Consejos para arrendar un sas, a state member bank. The order was issued vehiculo: Guia del consumidor, a Spanish-language jointly with the State of Kansas Office of the State version of the popular Keys to Vehicle Leasing: A Bank Commissioner. Consumer Guide. Since 1997 nearly 750,000 copies of the English The Federal Reserve Board on August 2, 1999, version of this brochure have been distributed. The announced the termination of a written agreement by brochure provides consumers with an overview of the and between Community Capital Corporation, Greenmost common type of vehicle lease used by the wood, South Carolina, and the Federal Reserve Bank automotive industry, a closed-end lease. It provides of Richmond. The written agreement included provifour key messages for consumers: sions addressing Year 2000 readiness. • Leasing is different from buying (Arrendar un The Federal Reserve Board on August 2, 1999, vehiculo es distinto a comprarlo) announced the termination of a cease and desist order • Consider beginning, middle, and end-of-lease against Putnam-Greene Financial Corporation, Eatoncosts (Considere los costos al inicio, durante, y al ton, Georgia. The cease and desist order included final del contrato de arrendamiento) provisions addressing Year 2000 readiness. • Compare different lease offers and negotiate terms (Comparar distintas ofertas de arrendamiento y Federal banking and credit union regulators jointly negociar algunas de las condiciones) announced on August 25, 1999, the termination of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 673 the March 30, 1999, agreement with First Data Cor- The Board also announced on August 23, 1999, the poration on Year 2000 compliance. The regulators transfer of Vincent R. Reinhart from the Division of said that the service provider to more than 200 banks, Monetary Affairs to the Division of International thrift institutions, and credit unions had complied Finance and his appointment as Deputy Director in with the terms of the agreement. International Finance. Mr. Reinhart will have general oversight responsibility for the International Banking, Financial Markets, and U.S. International Trans- CHANGES IN BOARD STAFF actions Sections, plus the Administrative Office. He was appointed to the official staff in 1994 and was The Board of Governors of the Federal Reserve Sys- named Deputy Associate Director in the Division of tem announced that Peter Hooper III, Deputy Direc- Monetary Affairs in 1998. • tor, Division of International Finance, resigned effective in September 1999. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

674 Minutes of the Federal Open Market Committee Meeting Held on June 29-30,1999 A meeting of the Federal Open Market Committee Messrs. Porter2 and Reinhart, Deputy Associate was held in the offices of the Board of Governors of Directors, Division of Monetary Affairs, Board of Governors the Federal Reserve System in Washington, D.C., on Tuesday, June 29, 1999, at 2:30 p.m. and continued Mr. Reifschneider,2 Section Chief, Division of on Wednesday, June 30, 1999, at 9:00 a.m. Research and Statistics, Board of Governors Present: Mses. Edwards,3 and Mauskopf,3 and Messrs. Lebow3 Mr. Greenspan, Chairman and Orphanides,2 Senior Economists, Divisions Mr. McDonough, Vice Chairman of Monetary Affairs, International Finance, Mr. Boehne Research and Statistics, and Monetary Affairs Mr. Ferguson respectively, Board of Governors Mr. Gramlich Mr. Kelley Ms. Garrett and Mr. Tetlow,2 Economists, Divisions Mr. McTeer of Monetary Affairs and Research and Statistics Mr. Meyer respectively, Board of Governors Mr. Moskow Mr. Stern Ms. Low, Open Market Secretariat Assistant, Division of Monetary Affairs, Board of Messrs. Broaddus, Guynn, Jordan, and Parry, Governors Alternate Members of the Federal Open Market Committee Mr. Barron, First Vice President, Federal Reserve Bank of Atlanta Mr. Hoenig, Ms. Minehan, and Mr. Poole, Presidents Messrs. Beebe, Eisenbeis, Goodfriend, Hakkio, of the Federal Reserve Banks of Kansas City, Rasche, and Sniderman, Senior Vice Presidents, Boston, and St. Louis respectively Federal Reserve Banks of San Francisco, Atlanta, Richmond, Kansas City, St. Louis, Mr. Kohn, Secretary and Economist and Cleveland respectively Mr. Bernard, Deputy Secretary Ms. Fox, Assistant Secretary Mr. Fuhrer and Ms. Perelmuter, Vice Presidents, Mr. Gillum, Assistant Secretary Federal Reserve Banks of Boston and New York Mr. Mattingly, General Counsel respectively Mr. Prell, Economist Mr. Johnson, Economist By unanimous vote, the minutes of the meeting of the Federal Open Market Committee held on May 18, Messrs. Alexander, Cecchetti, Hooper, Hunter, Lang, Lindsey, Rolnick, Rosenblum,1 Slifman, and 1999, were approved. Stockton, Associate Economists The Manager of the System Open market Account reported on recent developments in foreign exchange Mr. Fisher, Manager, System Open Market Account markets. There were no open market operations in foreign currencies for the System's account in the Mr. Ettin, Deputy Director, Division of Research and period since the previous meeting, and thus no vote Statistics, Board of Governors was required of the Committee. Messrs. Madigan and Simpson, Associate Directors, Divisions of Monetary Affairs and Research and 2. Attended portions of the meeting relating to the discussion of the Statistics respectively, Board of Governors policy implications of uncertainty about key economic variables. 3. Attended portions of the meeting relating to the Committee's review of the economic outlook and consideration of its monetary and 1. Attended Tuesday's session only. debt ranges for 1999 and 2000. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

675 The Manager also reported on developments in and consumer sentiment remaining very high. Total domestic financial markets and on System open mar- retail sales rose substantially in May following large ket transactions in government securities and federal increases on average earlier in the year. Gains in agency obligations during the period May 18, 1999, retail sales were relatively widespread, with outsized through June 29, 1999. The Committee ratified these advances in the food, general merchandise, and duratransactions by unanimous vote. ble goods categories. The Committee then turned to a discussion of Housing demand remained robust in recent months the economic and financial outlook, the ranges for despite the recent rise in mortgage rates. However, the growth of money and debt in 1999 and 2000, and builders were faced with shortages of workers and the implementation of monetary policy over the inter- some materials and were hard-pressed to keep pace meeting period ahead. with the demand for new homes. As a result, both The information reviewed at this meeting sug- single-family and multifamily housing starts fell gested that economic activity continued to expand somewhat on balance over April and May. vigorously, though at a somewhat slower pace than Information on shipments of nondefense capital earlier in the year. Consumer outlays and construc- goods in April and May suggested that business tion spending had decelerated somewhat after having investment in durable equipment picked up substangrown very rapidly in the first quarter, but the decel- tially in the second quarter from the already brisk eration had been partly offset by a step-up in business pace of the first quarter. Shipments of high-tech purchases of durable equipment and a smaller decline equipment, notably computers, were particularly in net exports. Labor markets remained very tight, robust over the April-May period. In addition, busiand recent wage and price increases had been a little ness demand for motor vehicles continued to be larger on balance; nonetheless, longer-term inflation strong, particularly for medium and heavy trucks for trends continued generally favorable in an environ- which the backlog of unfilled orders was still quite ment of robust improvements in productivity. large. By contrast, nonresidential construction activ- Nonfarm payroll employment rose substantially ity weakened in April (latest data) after a rise in the further on balance in April and May, but the increase first quarter, and available information on contracts was a little below the rate for the first quarter. Growth for future construction pointed to sluggish building in employment remained robust in the service- activity for some period ahead. producing sector in the April-May period. However, Business inventory accumulation slowed a bit in the number of jobs fell in the goods-producing sector: April from the relatively subdued first-quarter pace, payrolls in manufacturing and mining continued to and total business stocks remained at fairly low levels contract, and construction employment changed little in relation to sales. In manufacturing, inventories on net after a sizable first-quarter increase. The civil- continued to decline in April, and the aggregate ian unemployment rate edged down in May to inventory-shipment ratio for this sector stayed at the 4.2 percent, matching its low for the year and for the bottom of its range for the past twelve months. period since 1970. Wholesale stocks rose in April at about their average Industrial production advanced somewhat further pace for the early months of the year, and the ratio of in May despite a sharp weather-related drop in utility stocks to sales in this sector stayed in the lower end services and continued sluggishness in mining activ- of its range for the past year. Retail inventory accuity. Manufacturing output registered another substan- mulation slowed in April after a relatively large gain tial advance, reflecting a surge in the production of in the first quarter, and the aggregate inventory-sales motor vehicles and parts and persisting strength in ratio also remained in the lower end of its range for the manufacture of many other durable goods. The the past twelve months. output of nondurable goods posted another small The nominal deficit on U.S. trade in goods and increase in May, with the gains being relatively services widened somewhat in April from its firstbroadly based. Reflecting the stepped-up pace of quarter average. The value of exports increased manufacturing, the rate of utilization of capacity slightly from its first-quarter average, primarily edged higher in May but continued to be below its reflecting greater exports of computers and semiconlong-run average level. ductors, motor vehicles, and industrial supplies. The Growth of consumer spending appeared to have value of imports rose somewhat more, principally slowed somewhat from its extraordinary pace of the owing to larger imports of oil. The available informafirst quarter; nonetheless, the underlying trend in tion suggested that economic activity had picked up consumption remained strongly upward, with house- somewhat on balance in the major foreign industrial hold income and wealth continuing to expand rapidly countries. The Japanese economy was reported to Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

676 Federal Reserve Bulletin • October 1999 65 have expanded markedly in the first quarter, record- In foreign exchange markets, the trade-weighted ing its first quarterly rise in the past year and a half. value of the dollar edged up over the intermeeting In Europe, economic growth rebounded in Germany period in relation to the currencies of a broad group but slowed somewhat in France and the United King- of important U.S. trading partners. The dollar apprecidom. Signs of an improved economic performance ated against the euro, partly reflecting the contrast also were evident in Latin America and Southeast between continuing robust growth in the United Asia. States and generally subpar activity in euro-area The consumer price index was unchanged in May economies. The dollar also rose against the pound in following a sizable increase in April that was associ- association with slower growth in the United Kingated in part with a jump in energy prices. Excluding dom and a reduction in the Bank of England's repo the effects of movements in food and energy prices, rate. By contrast, the dollar weakened against the yen though, consumer inflation was a little higher in the as yields on Japanese government debt increased April-May period than in the first quarter; for the sharply relative to rates on U.S. Treasury securities. twelve months ended in May, core consumer prices Among other important trading partners, the dollar rose slightly less than in the previous twelve-month fell against the currencies of many emerging Asian period. Producer prices of finished goods also were economies, whose financial markets had generally affected by the volatility of energy prices in April improved, but appreciated in terms of the Brazilian and May, but core producer prices recorded only a real in association with periods of particular stress in small rise in each month. For the twelve months Brazil's financial markets. ended in May, however, core producer inflation was After having recorded sizable increases in April up noticeably compared with the year-earlier period, that apparently were associated with tax-related owing in important part to sharp increases in the buildups in liquid accounts, the growth of M2 and prices of tobacco products. With regard to labor M3 slowed sharply in May, as tax payments cleared, costs, average hourly earnings grew a little faster in and appeared to have remained moderate in June. May than in April, but they rose less in the twelve The expansion of these aggregates also seemed to months ended in May than in the previous twelve- have been damped in recent months by the rise in month period. their opportunity costs associated with earlier At its meeting on May 18, 1999, the Committee increases in interest rates. M2 was estimated to have adopted a directive that called for maintaining condi- increased for the year through June at a rate sometions in reserve markets that would be consistent with what above the Committee's annual range and M3 at an unchanged federal funds rate of about 43A percent, a rate near the upper end of its range. Although but the directive also contained a bias toward a growth of total domestic nonfinancial debt had modpossible tightening of policy. The members' concerns erated a little recently, it continued to expand at a about inflation had increased appreciably since the pace somewhat above the middle of its range. meeting in late March; nonetheless, the members felt The staff forecast prepared for this meeting sugthat the current stance of policy could remain consis- gested that the expansion would gradually moderate tent with subdued inflation for some time, especially to a rate commensurate with the growth of the econoif productivity gains continued robust and, as pro- my's estimated potential. The lagged effects of the jected, the growth of aggregate demand moderated earlier rise in the foreign exchange value of the dollar somewhat in the months ahead. were expected to place continuing, though diminish- Open market operations were directed throughout ing, restraint on the demand for U.S. exports for some the intermeeting period toward maintaining the fed- period ahead. The increase of private final demand eral funds rate at around 43A percent, and the average would be restrained by the anticipated waning of rate for the period was very close to the Committee's positive wealth effects associated with earlier large target. Other interest rates rose somewhat over the increases in equity prices; by slower growth of spendperiod since the May meeting in response to the ing on consumer durables, houses, and business combined effects of the Committee's announcement equipment in the wake of the prolonged buildup in of an asymmetric directive, economic data that gener- the stocks of these items; and by the rise that had ally were stronger than expected, and reported com- already occurred in market interest rates, especially ments of Federal Reserve officials. With the market for intermediate and longer maturities, in the expectaeffects of higher interest rates roughly offset by tion that higher interest rates would be needed to brighter second-quarter earnings prospects, broad in- achieve a better balance between aggregate demand dexes of share prices in equity markets changed little and aggregate supply. Price inflation was projected to on balance over the intermeeting period. rise somewhat over the projection horizon, in large Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Minutes of the Federal Open Market Committee 677 part as a result of some upturn in import prices and a quarter of 1999 and 4]A to 4l/i percent in the fourth slight firming of gains in nominal labor compensation quarter of 2000. Projections of the rate of inflation, as that would not be fully offset by rising productivity. measured by the consumer price index, pointed to an In the Committee's discussion of the outlook for appreciable increase in 1999, largely reflecting a economic activity and inflation, members commented swing in the price of energy, and little further change that the incoming information continued to suggest a in 2000; specifically, the projections converged on vigorous expansion but also subdued inflation despite CPI inflation rates of 2V4 to 2VI percent in 1999 and 2 very tight labor markets. Growth in aggregate to 2VI percent in 2000. The members anticipated that demand was estimated to have slowed somewhat in the effects of the century date change on economic the second quarter from outsized advances in the two activity would, on balance, be limited or negligible previous quarters, largely as a result of less ebullient over the forecast period, possibly adding somewhat though still robust growth in consumer spending. The to growth later this year and temporarily reducing members questioned, however, whether the limited growth early next year. indications of some moderation in the expansion in Key factors underlying the members' forecasts of recent months were a harbinger of a more sustainable appreciable moderation in the trend of real GDP pace of economic activity that would be consistent growth included a waning of the financial stimulus with the economy's estimated output potential and that had boosted domestic demand in recent years low inflation. Indeed, in the absence of some policy and the buildup of stocks of consumer durables, firming most of the members saw tightening labor housing, and business equipment after an extended markets and an upward drift in measured inflation as period of rapidly expanding purchases. However, the a significant risk. They acknowledged that the timing members acknowledged that the signs of slower and extent of a potential rise in inflation were subject growth in household and business spending were still to considerable uncertainty. In particular, as the expe- quite limited. rience of recent years had amply demonstrated, In the household sector, further substantial strengthening advances in productivity had reduced increases in income and financial wealth and high increases in unit costs to very low or even slightly levels of consumer confidence had fostered continued negative levels despite growing scarcities of labor robust growth in consumer spending in recent and some rise in the growth of labor compensation months, but apart from exceptional strength in purand in profit margins. Rising productivity growth had chases of motor vehicles, growth in real spending for not been sufficient, however, to keep labor markets durable consumer goods appeared to have moderated from tightening, given the extraordinary strength in recently from a very rapid pace earlier in the year. final U.S. demands, which if continued would show How long the favorable factors that continued to through into higher inflation. Moreover, it remained stimulate substantial growth in consumer expendiunclear how long faster gains in productivity could tures would persist was uncertain, notably with regard continue to offset increases in labor costs and avert an to the outlook for stock market prices and their intensification of price inflation. effects on consumer resources and willingness to In keeping with the practice at meetings just before spend. The stimulus to household spending from the Federal Reserve's semiannual monetary policy rapidly rising stock market wealth obviously would report to the Congress and the Chairman's associated diminish should prices in the stock market tend to testimony, the members of the Committee and the level out as many expected. In that event, growth in Federal Reserve Bank presidents not currently serv- consumer spending might be expected to moderate to ing as members had provided individual projections a pace more in line with the expansion in disposable of the growth in nominal and real GDP, the rate of incomes. unemployment, and the rate of inflation for the years Business investment spending, which featured 1999 and 2000. With regard to the growth of nominal exceptional growth in expenditures for producers' GDP, most of the forecasts were in ranges of 5 to durable equipment, appeared to have picked up in 5V percent for 1999 as a whole and 4 to 5 percent for recent months from an already rapid pace earlier in 2 2000. The forecasts of the rate of expansion in real the year. Nonetheless, business firms were expected GDP for 1999 had a central tendency of 3>/ to to trim the growth in their outlays for equipment as 2 3% percent and for 2000 they were centered on a forecasts of moderating expansion in aggregate range of 2VZ to 3 percent, below the increases experi- demand materialized. Such a cutback would be abetenced over the last three years. The civilian rate of ted to an extent by the somewhat higher levels of unemployment associated with these forecasts had market interest rates that business borrowers now central tendencies of 4 to AVA percent in the fourth faced. While growth in spending for high-technology Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

678 Federal Reserve Bulletin • October 1999 65 equipment and related products probably would activity and low inflation. In particular, accelerating remain rapid in light of the accelerated pace of inno- labor productivity clearly had curbed the rise in unit vations and declining prices for such equipment, a labor costs and damped pressures on prices. Very significant deceleration or slowdown in spending for recent data on underlying productivity trends were other types of capital equipment seemed likely under not yet available, but the fact that profit forecasts had projected economic conditions, especially given cur- continued to be marked up suggested that it might rently reduced rates of capacity utilization in many still be accelerating and holding down costs. Such manufacturing industries. In the nonresidential con- increases in productivity along with slack in foreign struction sector, business expenditures were expected economies contributed to the very strong competition to remain near current levels, reflecting ongoing in most markets that was continuing generally to strength in many parts of the country but also some suppress efforts to raise prices. Other factors consigns of overbuilding in other areas. straining inflation that were cited by the members A number of recent indicators suggested that on a included the ample availability of capacity in most seasonally adjusted basis residential building activity industries and the declines that had occurred in nonhad slowed a bit in the second quarter from an oil import prices. Despite these favorable developelevated level earlier in the year. However, home- ments, most members had become increasingly worbuilding apparently had been held back to some ried about the risks of an overheating economy and extent recently by scarcities of labor and some build- rising inflation over time. ing supplies, and sizable backlogs evidently had built The concerns about the outlook for inflation tended up. Looking ahead, the members expected residential to focus on the risk that, in the absence of an appreconstruction expenditures to hold near current levels ciable moderation in overall demands, very tight in the second half of this year as backlogs were labor markets would at some point foster signifiworked lower, but they anticipated some softening cantly faster increases in labor compensation that subsequently. Factors bearing on this outlook could no longer be offset by stronger productivity included the large additions to the stock of housing in growth. Indeed, at recent rates of increase in output, recent years and to some extent the backup that had labor utilization was likely to continue to rise, adding occurred in mortgage rates. At some point the higher to pressures on costs. The higher labor cost increases financing costs would begin to show through to hous- would in turn generate more rapid price inflation. ing demand. Members noted in this regard that the trend in aver- The available information indicated that U.S. age hourly earnings appeared to have tilted up in exports of goods and services had declined on bal- recent months. While this relatively recent developance thus far this year, while imports had posted very ment was not yet conclusive evidence of accelerating strong gains in line with continuing strength in U.S. labor costs, especially without further information domestic spending. However, improving economies about productivity, anecdotal reports of faster in a number of the nation's important trading partners increases in labor compensation also appeared to and the slower expansion forecast for the U.S. econ- have multiplied. In addition, improving economic omy were expected to have a favorable effect on conditions abroad, among other factors, had induced exports and to moderate increases in imports over the a firming in oil and other commodity prices, and had next several quarters. Indeed, recent data suggested supported the foreign exchange value of other currenthat U.S. exports had advanced slightly after having cies relative to the dollar. As a consequence, the posted sizable declines during the first quarter while declines in commodity and other import prices that imports had continued to grow strongly. On net, the had helped to suppress inflation and inflation expectamembers anticipated that the nation's trade balance tions over the past two years were not likely to be would continue to worsen, although more slowly and repeated. Members acknowledged that the prospects with a less negative effect on the U.S. economy over for rising inflation, including the potential timing of the forecast period. an acceleration, if any, remained uncertain given the questions surrounding both the ongoing strength of Members commented that inflation, as reflected in aggregate demand and the outlook for productivity, a wide range of statistical measures and anecdotal but they viewed the risks of added price pressures as reports, remained remarkably subdued despite the having risen further. persisting strength of the expansion and very tight labor markets across the nation. It seemed likely that In keeping with the requirements of the Full Emrising productivity, which appeared to have acceler- ployment and Balanced Growth Act of 1978 (the ated markedly of late, accounted for much of the Humphrey-Hawkins Act), the Committee reviewed surprising combination of rapid growth in economic at this meeting the ranges for growth of the monetary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Minutes of the Federal Open Market Committee 679 and debt ranges that it had established in February for selection of the range for debt did not reflect a price 1999, and it set tentative ranges for those aggregates stability and sustainable economic growth rationale for 2000. The current ranges approved in February but was based on forecasts of actual growth in this for the period from the fourth quarter of 1998 to the measure. fourth quarter of 1999, which were unchanged from At the conclusion of this discussion, the Committhose for the last several years, included growth of 1 tee voted to reaffirm the ranges for growth of M2, to 5 percent for M2 and 2 to 6 percent for M3. An M3, and total domestic nonfinancial debt that it had unchanged range of 3 to 7 percent also was set in established in February for 1999 and to extend these February for growth of total domestic nonfinancial ranges on a tentative basis to 2000. In keeping with debt in 1999. its usual procedures under the Humphrey-Hawkins All the members favored retaining the current Act, the Committee would review its preliminary ranges for this year and extending them on a provi- ranges for 2000 early next year. Accordingly, the sional basis to 2000. The members recognized that Committee voted to incorporate the following statethe growth of both M2 and M3, while decelerating ment regarding the 1999 and 2000 ranges in its markedly from 1998, might still exceed the ranges domestic policy directive: for the current year and be near the upper ends of the ranges in 2000, assuming economic and financial The Federal Open Market Committee seeks monetary conditions approximating their current expectations. and financial conditions that will foster price stability and However, as had been the case for many years, the promote sustainable growth in output. In furtherance of members remained concerned that forecasts of money these objectives, the Committee reaffirmed at this meeting the ranges it had established in February for growth of M2 growth were still subject to a wide range of error in and M3 of 1 to 5 percent and 2 to 6 percent respectively, terms of the anticipated relationships between money measured from the fourth quarter of 1998 to the fourth growth and aggregate economic performance. quarter of 1999. The range for growth of total domestic Accordingly, they agreed that those ranges should not nonfinancial debt was maintained at 3 to 7 percent for the reflect or be centered on forecasts of money growth year. For 2000, the Committee agreed on a tentative basis to set the same ranges for growth of the monetary aggreunder projected economic and financial conditions, gates and debt, measured from the fourth quarter of 1999 to but should be regarded as anchors or benchmarks for the fourth quarter of 2000. The behavior of the monetary money growth that would be associated with approxi- aggregates will continue to be evaluated in the light of mate price stability and sustained economic expan- progress toward price level stability, movements in their sion, assuming behavior of velocity in line with his- velocities, and developments in the economy and financial markets. torical experience. A reaffirmation of those ranges for 1999 and their extension to 2000 would therefore underscore the Committee's commitment to achiev- Votes for this action: Messrs. Greenspan, McDonough, Boehne, Ferguson, Gramlich, McTeer, Meyers, Moskow, ing and maintaining price stability over time and Kelly, and Stern. Votes against this action: None. Absent thereby fostering maximum sustainable economic and not voting: Ms. Rivlin growth. It was noted during this discussion that the apparent pickup in productivity, if it persisted, sug- In the Committee's discussion of policy for the gested that somewhat higher ranges than those intermeeting period ahead, all but one member supadopted in recent years might more accurately reflect ported a proposal for a slight tightening of conditions money growth under conditions of price stability and in reserve markets consistent with an increase of historically typical velocity trends. However, the XA percentage point in the federal funds rate to an members agreed that the marked degree of uncer- average of around 5 percent. In the view of most tainty in the outlook for productivity as well as members, such a policy move represented a desirable velocity argued against any increases in the ranges at and cautious preemptive step in the direction of this point. reducing what they saw as a significant risk of rising The Committee members were unanimously in inflation. While current indications of accelerating favor of retaining the current range of 3 to 7 percent inflation were quite limited, the economy had been for growth of total domestic nonfinancial debt in expanding rapidly enough to put added pressure on 1999 and extending that range on a provisional basis labor markets over time, and many members to 2000. They took account of a staff projection expressed growing concern that, given the current indicating that growth of the debt aggregate was stance of monetary policy, the persisting strength of likely to be around the middle of this range, perhaps domestic demand augmented by increasing demand somewhat above in 1999 and somewhat below in from abroad would show through at some point to 2000. Unlike the ranges for the monetary aggregates, even tighter labor markets and higher inflation, which Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

680 Federal Reserve Bulletin • October 1999 65 would impinge over time on the economy's ability to time and could foster the misleading conclusion that realize its full growth potential. In these circum- the Committee no longer believed a further adjuststances, a small preemptive move at this time would ment to policy might be warranted at some point later provide a degree of insurance against worsening this year. They saw the odds as reasonably high that inflation later. Members commented that the action in further tightening would be needed before the end of question would reverse a portion of the easing actions the year to gain adequate assurance that inflation implemented during the fall of 1998 that had been would be contained. Despite their differing preferundertaken in part to protect against the possibility ences, all the members who supported a policy tightthat unsettled global markets would place even ening move also indicated that they could accept a greater constraints on foreign and domestic economic symmetrical directive because the announcement to activity than were then evident. As financial markets be released after this meeting along with the Chairand foreign economies stabilized and recovered, that man's Humphrey-Hawkins testimony during the latadded protection was no longer required and policy ter part of July could serve to correct possible misinneeded to move to a less accommodative stance to terpretations. promote sustainable growth in spending. One mem- At the conclusion of this discussion, the Commitber did not agree that any tightening of policy was tee voted to authorize and direct the Federal Reserve necessary to contain inflation, given the persistence Bank of New York, until it was instructed otherwise, of low inflation, accelerating productivity, and what to execute transactions in the System Account in in his view was an already sufficiently restrictive accordance with the following domestic policy monetary policy stance. directive: The members were divided over whether to retain the current asymmetrical directive tilted toward The information reviewed at this meeting suggests conrestraint or to adopt a symmetrical directive in con- tinued vigorous expansion in economic activity. Nonfarm payroll employment has increased at a relatively rapid pace junction with the contemplated tightening action. A in recent months and the civilian unemployment rate, at majority endorsed a proposal to shift to a symmetri- 4.2 percent in May, matched its low for the year. Manufaccal directive. They agreed that following today's turing output rose substantially further in May. Total retail limited policy move the risks would still remain tilted sales increased briskly last month after recording large toward rising inflation, and they expected that the gains on average earlier in the year. Housing activity has remained robust in recent months. Available indicators announcement of a change in policy shortly after the suggest that business capital spending, especially for informeeting would include a reference to the Commitmation technology, has accelerated this spring. The nomitee's ongoing concerns in that regard. But in light of nal deficit on U.S. trade in goods and services widened the marked degree of uncertainty relating to the somewhat in April from its first-quarter average. Consumer extent and timing of prospective inflationary pres- price inflation was up somewhat on balance in April and May, boosted by a sharp increase in energy prices; improvsures, they believed that further firming of policy ing productivity has held down increases in unit labor costs might not be necessary in the near term and in any despite very tight labor markets. case would depend importantly on future develop- Interest rates have risen somewhat since the meeting on ments. Some of these members were concerned that May 18, 1999. Key measures of share prices in equity retention of asymmetry might be interpreted as an markets are unchanged to somewhat lower on balance over indication that the Committee was relatively certain the intermeeting period. In foreign exchange markets, the trade-weighted value of the dollar has changed little over that it would need to take further tightening action the period in relation to the currencies of a broad group of fairly soon, a view that tended to be reinforced by the important U.S. trading partners. behavior of expectations in the period after the After recording sizable increases in April, apparently announcement of a shift to asymmetry at the May owing to a tax-related buildup in liquid accounts, growth of meeting. M2 and M3 slowed in May as tax payments cleared and appears to have remained moderate in June. For the year Members who preferred to retain an asymmetrical through June, M2 is estimated to have increased at a rate directive agreed that, although there was little likelisomewhat above the Committee's annual range and M3 at hood of a further policy change during the intermeeta rate near the upper end of its range. Total domestic ing period, such a directive was the best way to nonfinancial debt has continued to expand at a pace someconvey their concerns about the risks of rising infla- what above the middle of its range. tion and the potential need for policy tightening over The Federal Open Market Committee seeks monetary time. A number of those in favor of asymmetry were and financial conditions that will foster price stability and promote sustainable growth in output. In furtherance of concerned that a symmetrical directive would not these objectives, the Committee reaffirmed at this meeting capture the Committee's thinking with regard to the the ranges it had established in February for growth of M2 most likely policy course over an extended period of and M3 of 1 to 5 percent and 2 to 6 percent respectively, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Minutes of the Federal Open Market Committee 681 measured from the fourth quarter of 1998 to the fourth most sensitive commodity prices have risen only quarter of 1999. The range for growth of total domestic slightly after years of decline, the dollar remains nonfinancial debt was maintained at 3 to 7 percent for the strong, real short-term interest rates are near historiyear. For 2000, the Committee agreed on a tentative basis cal norms, and productivity growth has accelerated in to set the same ranges for growth of the monetary aggregates and debt, measured from the fourth quarter of 1999 to recent quarters. Mr. McTeer does not believe that the fourth quarter of 2000. The behavior of the monetary rapid growth based on new technology, rising producaggregates will continue to be evaluated in the light of tivity, and other supply-side factors is inflationary, progress toward price level stability, movements in their especially in the current global environment. He velocities, and developments in the economy and financial would have preferred to continue to test the growth markets. To promote the Committee's long-run objectives of price limits of the new economy. stability and sustainable economic growth, the Committee By notation vote completed on July 14, 1999, in the immediate future seeks conditions in reserve markets available members of the Committee voted unaniconsistent with increasing the federal funds rate to an mously to delegate responsibility to Mr. Gramlich average of around 5 percent. In view of the evidence and in his absence to Mr. Ferguson for making decicurrently available, the Committee believes that prospective developments are equally likely to warrant an increase sions on appeals of denials by the secretary of the or a decrease in the federal funds rate operating objective Committee for access to Committee records. This during the intermeeting period. action was taken in keeping with the provisions of 271.4(d) of the Committee's Rules Regarding Avail- Votes for this action: Messrs. Greenspan, McDonough, ability of Information. Boehne, Ferguson, Gramlich, Meyers, Moskow, Kelley, and Stern. Vote against this action: Mr. McTeer. Absent and not voting: Ms. Rivlin Votes for this action: Messrs. Greenspan, McDonough, Boehne, Ferguson, Gramlich, Meyers, Moskow, Kelley, and Stern. Votes against this action: None. Not voting: Mr. McTeer dissented because he believed that Mr. McTeer and Ms. Rivlin tightening was unnecessary to contain inflation. He noted that most measures of current inflation remain It was agreed that the next meeting of the Commitlow, and he saw few signs of inflation in the pipeline. tee would be held on Tuesday, August 24, 1999. Conditions that called for a preemptive tightening in The meeting adjourned at 11:45 a.m. 1994—rapidly rising commodity prices and real short-term interest rates near zero—are not present today. While money growth has been rapid by histori- Donald L. Kohn cal standards, market-based indicators of monetary Secretary policy suggest sufficient restraint. Except for oil, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 683 Legal Developments institutions in the state ("state deposits").1 Harlingen ORDERS ISSUED UNDER BANK HOLDING COMPANY Bancshares is the 95th largest banking organization in ACT Texas, controlling $194 million in deposits representing Orders Issued Under Section 3 of the Bank Holding less than 1 percent of state deposits. On consummation of Company Act the proposal, Texas Regional would become the tenth largest banking organization in Texas, controlling deposits of $1.7 billion, representing less than 1 percent of state deposits. Texas Regional Bancshares, Inc. McAllen, Texas Competitive Considerations The BHC Act and the Bank Merger Act prohibit the Board Texas State Bank from approving a proposal if it would result in, or be in the McAllen, Texas furtherance of a monopoly. These acts also prohibit the Board from approving a proposal if the effect of the proposal may be substantially to lessen competition in any Order Approving Merger of Bank Holding Companies, relevant market unless the Board finds that the anticompeti- Merger of Banks and Establishment of Branches tive effects of the proposed transaction are clearly outweighed in the public interest by the probable effect of the transaction in meeting the convenience and needs of the Texas Regional Bancshares, Inc. ("Texas Regional"), a community to be served.2 bank holding company within the meaning of the Bank Texas Regional and Harlingen Bancshares compete di- Holding Company Act ("BHC Act"), has requested the rectly in two Texas banking markets, the McAllen- Board's approval under section 3 of the BHC Act Edinburg-Mission banking market (the "McAllen banking (12 U.S.C. § 1842) to merge with Harlingen Bancshares, market") and the Brownsville-Harlingen-San Benito bank- Inc. ("Harlingen"), and thereby to acquire Harlingen's ing market (the "Brownsville banking market").3 Consumwholly owned subsidiary, HN Bancshares of Delaware, mation of the proposal would be consistent with the De- Inc., which in turn owns Harlingen National Bank partment of Justice Merger Guidelines ("DOJ ("Harlingen National"), all in Harlingen, Texas. Texas Guidelines")4 and prior Board precedent in the McAllen Regional's lead bank, Texas State Bank, McAllen, Texas, banking market. On consummation of the proposal, Texas also has requested the Board's approval under sec- Regional would remain the largest banking organization in tion 18(c) of the Federal Deposit Insurance Act (the "Bank the McAllen banking market and control $1.1 billion in Merger Act") (12 U.S.C. § 1828(c)) to merge with Harlin- deposits, representing 27.4 percent of total deposits in gen National, and approval under section 9 of the Federal depository institutions in the market ("market deposits"). Reserve Act ("ERA") (12 U.S.C. § 321) to establish The HHI would increase 17 points to 1441.5 branches at the six current offices of Harlingen National, all in Texas, listed in the Appendix. Notice of the proposal, affording interested persons an 1. State deposit data are as of June 30, 1998. In this context, opportunity to submit comments, has been published depository institutions include commercial banks, savings banks, and (64 Federal Register 36,017 (1999)) in accordance with savings associations. the Board's Rules of Procedure (12 C.F.R. 262.3(b)). As 2. 12 U.S.C. §§ 1842(c)(1)(B) and 1828(c)(5)(B). 3. The McAllen banking market is defined as Hidalgo, Starr, and required by the Bank Merger Act, notice of the proposal Willacy Counties, all in Texas. The Brownsville banking market is also has been published in relevant newspapers, and redefined as Cameron County, Texas. ports on the competitive effects of the bank mergers have 4. Under the revised DOJ Guidelines, 49 Federal Register 26,823 been requested from the United States Attorney General, (June 29, 1984), a market in which the post-merger Herfindahlthe Office of the Comptroller of the Currency ("OCC"), Hirschman Index ("HHI") is above 1800 is considered highly concentrated. The Department of Justice has informed the Board that a bank and the Federal Deposit Insurance Corporation ("FDIC"). merger or acquisition generally will not be challenged (in the absence The time for filing comments has expired and the Board of other factors indicating anticompetitive effects) unless the posthas considered the proposal and all comments received in merger HHI is at least 1800 and the merger increases the HHI by more light of the factors set forth in the BHC Act, the Bank than 200 points. The Department of Justice has stated that the higher Merger Act, and the FRA. than normal HHI thresholds for screening bank mergers for anticompetitive effects implicitly recognize the competitive effect of limited- Texas Regional is the 12th largest banking organization purpose lenders and other nondepository financial entities. in Texas, controlling $1.5 billion in deposits, representing 5. Market share data are as of June 30, 1998. These data are based less than 1 percent of total deposits in insured depository on calculations in which the deposits of thrift institutions are included Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

684 Federal Reserve Bulletin • October 1999 65 In the Brownsville banking market, consummation of cantly adverse effects on competition or on the concentrathe proposal would increase the level of market concentra- tion of banking resources in the McAllen and Brownsville tion, as measured by the HHI, to levels that exceed the banking markets or any other relevant market. On this DOJ Guidelines. Texas Regional is the fourth largest of basis, the competitive factors are consistent with approval 12 banking organizations in the Brownsville banking mar- of this proposal. ket, and controls deposits of $287.6 million, representing approximately 13.8 percent of market deposits. Harlingen Other Considerations Bancshares is the sixth largest banking organization in the market, and controls deposits of $180.8 million, represent- The BHC Act and the Bank Merger Act require the Board, ing approximately 8.6 percent of market deposits. On con- in acting on an application, to consider the financial and summation of the proposal, Texas Regional would become managerial resources and future prospects of the compathe second largest banking organization in the market with nies and banks involved, the convenience and needs of the deposits of $468 million, representing approximately communities to be served, and certain supervisory factors. 22.4 percent of market deposits. The HHI would increase The Board has reviewed these factors in light of the record, 238 points to 1940. including supervisory reports of examination assessing the In reviewing the competitive effects of this proposal, the financial and managerial resources of the organizations and Board has considered that several factors appear to miti- financial information provided by Texas Regional. Based gate the likely effect of the proposal on competition in the on all the facts of record, the Board concludes that the Brownsville banking market. In particular, one thrift oper- financial and managerial resources and the future prospects ating in the Brownsville banking market has been an active of Texas Regional, Harlingen Bancshares, and their respeccommercial lender.6 In addition, 11 competitors would tive subsidiary banks are consistent with approval, as are remain in the Brownsville banking market following the the other supervisory factors the Board must consider merger, and five of those competitors would each have under section 3 of the BHC Act. In addition, considerations market shares of more than 5 percent.7 The Brownsville related to the convenience and needs of the communities to banking market is attractive for entry. The Brownsville be served, including the records of performance of the banking market recently had the tenth largest increase in institutions under the Community Reinvestment Act, are population for Metropolitan Statistical Areas in the United consistent with approval of the proposal. States. Since June 1996, four banking organizations have The Board also has considered the factors it is required entered the market de novo. to consider when reviewing applications for establishment The Justice Department reviewed the proposal and ad- of branches under section 9 of the FRA, including the vised the Board that consummation of the proposal would permissibility of the branch locations under state law.8 not likely have any significantly adverse competitive ef- Based on all the facts of record, the Board concludes that fects in the Brownsville banking market or any other these factors are consistent with approval of Texas State relevant banking market. The FDIC and OCC have not Bank's application to establish branches listed in the objected to the proposal. Appendix. Based on all the facts of record, and for the reasons discussed in this order, the Board concludes that consum- Conclusion mation of the proposal is not likely to result in any signifi- Based on the foregoing, and in light of all the facts of record, the Board has determined that the applications and at 50 percent. The Board previously has indicated that thrift institu- notices in this case should be, and hereby are, approved. tions have become, or have the potential to become, significant The Board's approval is specifically conditioned on comcompetitors of commercial banks. See Midwest Financial Group, pliance by Texas Regional with all the commitments made 75 Federal Reserve Bulletin 386 (1989); National City Corporation, in connection with these applications and notices. For the 70 Federal Reserve Bulletin 743 (1984). Thus the Board has regularly included thrift deposits in the calculation of market share on a purpose of this action, the commitments and conditions 50-percent weighted basis. See, e.g., First Hawaiian, Inc., 77 Federal relied on by the Board in reaching its decisions are deemed Reserve Bulletin 52 (1991). to be conditions imposed in writing by the Board in con- 6. The thrift, Coastal Banc, has 5.9 percent of its total loan portfolio nection with its findings and decision and, as such, may be in nonmortgage commercial loans, and provides a variety of consumer enforced in proceedings under applicable law. and mortgage loans and other banking products and services. Accordingly, competition from Coastal Banc more closely approximates The acquisition of the bank shall not be consummated competition from a commercial bank. The Board previously has before the fifteenth calendar day following the effective indicated that it may consider the competitiveness of a thrift institudate of this order, or three months after the effective date of tion at a level greater than 50 percent of the thrift's deposits when this order, unless such period is extended for good cause by appropriate. See Banknorth Group, Inc., 75 Federal Reserve Bulletin 703 (1989). Accounting for the deposits of the thrift at 100 percent, the Board or by the Federal Reserve Bank of Dallas, acting consummation of the proposal would increase the HHI in the Browns- pursuant to delegated authority. ville banking market by 211 points to 1822, and Texas Regional would have a post-merger market share of approximately 21.1 percent. 7. Three competitors, excluding Texas Regional, would have market shares of 30, 16 and 15 percent, respectively. 8. See Tex. Fin. Code Ann. § 32.203 (West 1997). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 685 By order of the Board of Governors, effective Au- United States, controlling less than 1 percent of the total gust 23, 1999. assets of insured commercial banks in the United States ("total banking assets").2 AmSouth is the third largest Voting for this action: Chairman Greenspan and Governors Kelley, depository institution in Alabama, controlling deposits of Meyer, Ferguson, and Gramlich. $6.9 billion, representing approximately 13.6 percent of total deposits in depository institutions in the state.3 Am- ROBERT DEV. FRIERSON South's subsidiary bank also operates in Florida, Georgia, Associate Secretary of the Board and Tennessee, and AmSouth engages in a number of permissible nonbanking activities. Appendix First American, with total consolidated assets of $20.7 billion, is the 41st largest commercial banking orga- Branches of Texas State Bank to be established at nization in the United States, controlling less than 1 per- Harlingen National's current offices in Texas. cent of total banking assets. First American is the second largest depository institution in Tennessee, controlling de- 1. 115 East Van Buren Street, Harlingen. posits of $9 billion in the state, representing approximately 2. 2302 South 77 Sunshine Strip, Harlingen. 13.7 percent of total deposits in depository institutions in 3. 1902 West Tyler Street, Harlingen. the state. First American's subsidiary depository institu- 4. 1200 North Stuart Place Road, Harlingen. tions also operate in Arkansas, Georgia, Kentucky, Louisi- 5. 101 North Main Street, La Feria. ana, Mississippi, and Virginia. 6. 201 Starr Street, Mercedes. After consummation of the proposal, AmSouth would become the 22nd largest commercial banking organization Orders Issued Under Sections 3 and 4 of the Bank in the United States, with total consolidated assets of $40.6 Holding Company Act billion, representing less than 1 percent of total banking assets. After consummation, AmSouth's subsidiary insured AmSouth Bancorporation depository institutions would operate in nine states. Birmingham, Alabama Interstate Analysis Order Approving the Merger of Bank Holding Companies Section 3(d) of the BHC Act allows the Board to approve an application by a bank holding company to acquire AmSouth Bancorporation ("AmSouth"), a bank holding control of a bank located in a state other than the home company within the meaning of the Bank Holding Comstate of such bank holding company if certain conditions pany Act ("BHC Act"), has requested the Board's ap- are met.4 For purposes of the BHC Act, the home state of proval under section 3 of the BHC Act (12 U.S.C. §1842) AmSouth is Alabama, and AmSouth proposes to acquire to merge with First American Corporation ("First Ameri- FANB, which is located in Arkansas, Georgia, Kentucky, can"), and thereby acquire First American's only subsid- Louisiana, Mississippi, and Tennessee.5 All the conditions iary bank, First American National Bank ("FANB"), Nashfor an interstate acquisition enumerated in section 3(d) are ville, Tennessee. AmSouth also has requested the Board's met in this case.6 In light of all the facts of record, the approval under section 4(c)(8) of the BHC Act (12 U.S.C. § 1843(c)(8)) and section 225.24 of the Board's Regulation Y (12 C.F.R. 225.24) to acquire First Ameri- 2. All data used for purposes of calculating nationwide rankings are can's nonbanking subsidiaries, First American Federal Sav- as of December 31, 1998. All other banking data are as of June 30, ings Bank ("FA-FSB") and First American Community 1998, and have been adjusted to account for mergers consummated Development Corporation, both in Nashville, Tennessee.1 since that date. 3. In this context, depository institutions include commercial banks, Notice of the proposal, affording interested persons an savings banks, and savings associations. opportunity to submit comments, has been published 4. See 12 U.S.C. § 1842(d). A bank holding company's home state (64 Federal Register 36,875 (1999)). The time for filing is the state in which the total deposits of all banking subsidiaries of comments has expired, and the Board has considered the such company were the largest on July 1, 1966, or the date on which proposal and all comments received in light of the factors the company became a bank holding company, whichever is later. 5. For purposes of section 3(d) of the BHC Act, the Board considers set forth in sections 3 and 4 of the BHC Act. a bank to be located in the states in which the bank is chartered, AmSouth, with total consolidated assets of $19.9 billion, headquartered, or operates a branch. See 12 U.S.C. §§ 1842(d)(1)(A) is the 43rd largest commercial banking organization in the and (2)(B) and 1841(o)(4), (5), (6), and (7). 6. 12 U.S.C. §§ 1842(d)(1)(A) and (B) and 1842(d)(2)(A) and (B). AmSouth meets the capital and managerial requirements established 1. Under the proposal, First American would merge with a newly under applicable law. FANB also has been in existence and operated formed, wholly owned subsidiary of AmSouth and, shortly thereafter, for the minimum period of time required by applicable state law. On this subsidiary would merge into AmSouth, with AmSouth surviving consummation, AmSouth would control less than 10 percent of the the transactions. AmSouth and First American also each have re- total amount of deposits of insured depository institutions in the quested the Board's approval to hold and exercise an option to acquire United States and less than 30 percent, or the appropriate percentage up to 19.9 percent of the other's voting shares. These options would established by applicable state law, of total deposits held by insured expire on consummation of the proposed merger. depository institutions in Georgia and Tennessee, the states in which Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

686 Federal Reserve Bulletin • October 1999 65 Board is permitted to approve the proposal under sec- by the Herfindahl-Hirschman Index ("HHI"),10 and other tion 3(d) of the BHC Act. characteristics of the markets. Consummation of the proposal without divestitures Competitive Factors would be consistent with Board precedent and the DOJ Guidelines in the Cleveland and Nashville banking markets Section 3 of the BHC Act prohibits the Board from approv- in Tennessee, and the Chattanooga banking market in ing a proposal that would result in a monopoly or be in Tennessee and Georgia.11 Each of these banking markets furtherance of a monopoly. Section 3 also prohibits the would remain moderately concentrated after consumma- Board from approving a proposal that would substantially tion of the proposal and numerous competitors would lessen competition in any relevant banking market unless remain in each market relative to the size of the market. the anticompetitive effects of the proposal in that banking Consummation of the proposal in the Rhea County bankmarket are clearly outweighed in the public interest by the ing market, without divestitures, would exceed the DOJ probable effect of the proposal in meeting the convenience Guidelines as measured by the HHI. AmSouth is the third and needs of the community to be served.7 largest depository institution in the Rhea County banking AmSouth and First American compete directly in the market, controlling deposits of $47.5 million, representing Cleveland, Nashville, and Rhea County banking markets, approximately 20.5 percent of market deposits. First Amerall in Tennessee, and the Chattanooga banking market, in ican is the second largest depository institution in the Tennessee and Georgia.8 The Board has carefully reviewed market, controlling deposits of $65.3 million, representing the competitive effects of the proposal in each of these approximately 28.2 percent of market deposits. banking markets in light of all the facts of record, including To mitigate the potential anticompetitive effects of the the number of competitors that would remain in the mar- proposal in the Rhea County banking market, AmSouth ket, the share of total deposits in depository institutions in has committed to divest one branch of First American, the market ("market deposits") controlled by each compet- which currently controls approximately $41.4 million in itor in the market,9 the concentration level of market depos- deposits.12 After accounting for the proposed divestiture, its in the market and the increase in this level as measured consummation of the transaction would result in AmSouth controlling approximately 30.6 percent of market deposits in the Rhea County banking market, and AmSouth would become the largest depository institution in the market. A new competitor would control approximately 18 percent of market deposits, and would become the third largest depos- AmSouth and First American both operate insured depository institu- itory institution in the market. In light of the proposed tions. See Ga. Code Ann. § 7-l-622(b); Tenn. Code Ann. § 45-2- divestiture, the HHI in the Rhea County banking market 1404. All other requirements under section 3(d) of the BHC Act also would increase by 50 points to 3901, and consummation of would be met on consummation of the proposal. the proposal would be consistent with Board precedent and 7. See 12 U.S.C. § 1842(c). the DOJ Guidelines. 8. The Cleveland banking market is defined as Bradley County, and the towns of Benton and Ococee in Polk County, all in Tennessee. The Nashville banking market is defined as the counties of Cheatham, Davidson, Robertson, Rutherford, Sumner, Williamson, and Wilson, all in Tennessee. The Rhea County banking market is defined as Rhea 10. Under the Department of Justice Merger Guidelines ("DOJ County, Tennessee. The Chattanooga banking market is defined to Guidelines"), 49 Federal Register 26,923 (June 29, 1984), a market in include Hamilton and Marion Counties in Tennessee (excluding the which the post-merger HHI is more than 1800 is considered to be town of Monteagle in Marion County), and Catoosa, Dade, and highly concentrated. The Department of Justice has informed the Walker Counties in Georgia. Board that a bank merger or acquisition generally will not be chal- The Board notes that AmSouth has withdrawn its request that the lenged (in the absence of other factors indicating anticompetitive Chattanooga banking market be expanded to include Rhea County. effects) unless the post-merger HHI is at least 1800 and the merger Accordingly, the Board has considered the Chattanooga and Rhea increases the HHI by more than 200 points. The Department of Justice County banking markets as separate markets in reviewing the compet- has stated that the higher than normal HHI thresholds for screening itive effects of the proposal and has treated comments challenging the bank mergers for anticompetitive effects implicitly recognize the proposed expansion of the Chattanooga banking market to include competitive effects of limited-purpose lenders and other nondeposi- Rhea County as moot. tory financial institutions. 9. Market share data are based on calculations that include the 11. The competitive effects of the proposal in these three banking deposits of thrift institutions, which include savings banks and savings markets are summarized in the Appendix. associations, weighted at 50 percent. The Board previously has indi- 12. AmSouth has committed to execute, before consummation of cated that thrift institutions have become, or have the potential to the proposal, an agreement to sell the relevant branch to an out-ofbecome, significant competitors of commercial banks. See, e.g., market commercial banking organization that is competitively suitable Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989); to the Board and to complete the proposed divestiture within 180 days National City Corporation, 70 Federal Reserve Bulletin 743 (1984). of consummation of the proposal. AmSouth also has committed that, Thus, the Board regularly has included thrift deposits in the calcula- if it is unsuccessful in completing the divestiture within the 180-day tion of market share on a 50-percent weighted basis. See, e.g., First period, it will transfer the unsold branch to an independent trustee that Hawaiian, Inc., 77 Federal Reserve Bulletin 52 (1991). FA-FSB is acceptable to the Board and will instruct the trustee to sell the operates a branch in the Chattanooga banking market. Because branch promptly to an alternative purchaser acceptable to the Board. FA-FSB is, and would continue to be, controlled by a bank holding See BankAmerica Corporation, 78 Federal Reserve Bulletin 338 company, the thrift's deposits have been included in the calculation of (1992); United New Mexico Financial Corporation, 77 Federal market shares on a 100-percent weighted basis. Reserve Bulletin 484 (1991). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 687 The Board has sought and considered the views of the Convenience and Needs Factor Department of Justice regarding the competitive effects of the proposal in each relevant banking market, including In acting on a proposal under section 3 of the BHC Act, the Rhea County. Based on all the facts of record, including Board is required to consider the effect of the proposal on the proposed branch divestiture in Rhea County, the Board the convenience and needs of the communities to be concludes that consummation of the proposal would not served. The Board has long held that consideration of the result in any significantly adverse effects on competition or convenience and needs factor includes a review of the on the concentration of banking resources in the banking records of the relevant depository institutions under the markets in which AmSouth and First American now com- Community Reinvestment Act (12 U.S.C. § 2901 et seq.) pete or any other relevant banking market. ("CRA"). Accordingly, the Board has carefully considered the effect of the proposed merger on the convenience and Financial, Managerial, and Other Supervisory Factors needs of the communities to be served and the CRA records of performance of the institutions involved in light Section 3 of the BHC Act also requires that the Board of all the facts of record, including comments received on consider the financial and managerial resources and future the proposal. prospects of the companies and banks involved in a pro- Approximately 54 interested persons submitted composal and certain other supervisory factors. The Board has ments either supporting the proposal or commenting favorcarefully considered the financial and managerial resources ably on the CRA-related activities of AmSouth or First and future prospects of AmSouth, First American, and American. Some of these commenters commended their respective subsidiary banks and other supervisory AmSouth or First American for providing loans, investfactors in light of all the facts of record, including com- ments, technical assistance, or other forms of support to ments received on the proposal,13 reports of examination community development and nonprofit organizations in and other confidential supervisory information assessing their local communities. Others commented favorably on the financial and managerial resources of the organizations, AmSouth's announced $3.5 billion, five-year lending and and financial information provided by AmSouth. The community development pledge, which would include for- Board notes that AmSouth and First American and their mation of a new AmSouth Community Development Corsubsidiary depository institutions currently are well capital- poration.15 ized and are expected to remain so on consummation of the Two commenters opposed the proposal, alleging that proposal. Based on these and all the other facts of record, AmSouth and First American have inadequate records of the Board concludes that the financial and managerial meeting the banking and credit needs of the communities resources and future prospects of AmSouth, First Ameri- they serve, particularly in areas with predominantly lowcan, and their subsidiary banks are consistent with ap- and moderate-income ("LMI") and minority populations.16 proval, as are the other supervisory factors that the Board Commenters opposing the proposal also alleged, on the must consider under section 3 of the BHC Act.14 basis of individual customer transactions or housingrelated lending data submitted by AmSouth and First American under the Home Mortgage Disclosure Act 13. These comments include submissions: (i) contending that (12 U.S.C. § 2801 et seq.) ("HMDA"), that AmSouth and AmSouth and First American improperly terminated employees in First American have violated the fair lending laws.17 anticipation of receiving Board approval of the proposal, and (ii) citing reports that, in 1959, a branch employee of a bank subsequently acquired by First American notified certain Mississippi public officials that a local chapter of the National Association for the Advancement forwarded those comments relating to FANB to the Office of the of Colored People had opened a deposit account with the bank. Comptroller of the Currency, the bank's appropriate federal supervi- AmSouth has indicated that First American independently determined sor. to discontinue certain operations in light of the proposed merger and 15. This pledge includes a $2 billion goal for small business lending in furtherance of previously initiated business reorganizations and the in low- and moderate-income areas, and a $1.5 billion goal for record does not support a finding that AmSouth exercised a control- housing-related loans to low- or moderate-income individuals or in ling influence over First American regarding this or any other manage- low- or moderate-income areas. The proposed new community develment decision or policy. AmSouth also has indicated that the branch opment organization would provide homeownership counseling proemployee responsible for the 1959 incident is no longer with First grams and technical assistance to nonprofit organizations that support American. affordable housing, small businesses, or community development. 14. Certain commenters criticized the manner in which the manage- 16. The commenters that opposed the proposal were Inner City ment of AmSouth or First American handled loan, banking, and other Press/Community on the Move and Inner City Public Interest Law financial service transactions in individual cases. These comments Center, Bronx, New York, and Citizens Against Legal Abuse, Inc., included allegations of improper treatment by First American and its New Orleans, Louisiana. predecessors arising from a 1984 loan transaction that has been the 17. One commenter submitted information contending that subject of three separate judicial proceedings, each of which has been AmSouth has discriminated against minorities in its hiring practices resolved in favor of First American. Some of the other transactions and placement of personnel. The racial composition of an applicant's mentioned by commenters also have been the subject of suits that workforce is not a factor the Board is permitted to consider in acting were judicially resolved in favor of AmSouth or First American, or on an application under the BHC Act. The Board notes that the Equal are the subject of litigation that remains pending with no adjudication Employment Opportunity Commission ("EEOC") has jurisdiction to of wrongdoing on the part of AmSouth or First American. The Board determine whether banking organizations such as AmSouth and has considered these comments in light of all the facts of record in AmSouth Bank are in compliance with federal equal employment reviewing the managerial and convenience and needs factors, and has opportunity statutes under the regulations of the Department of Labor. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

688 Federal Reserve Bulletin • October 1999 65 CRA Performance Examinations pated in the Federal National Mortgage Association Community Home Buyer's Program, a low down payment As provided in the CRA, the Board has evaluated the mortgage product designed for LMI individuals. convenience and needs factor in light of examinations of Examiners found that AmSouth Bank solicited loan apthe CRA performance records of the relevant depository plications from all segments of its communities, including institutions by the appropriate federal financial supervisory LMI neighborhoods, and that a high percentage of the agency.18 AmSouth's only subsidiary bank, AmSouth bank's loan originations were within the bank's assessment Bank, Birmingham, Alabama, received a "satisfactory" areas, which included portions of Alabama, Florida, Georrating at its most recent CRA performance examination by gia, and Tennessee.20 Examiners concluded that the bank the Federal Reserve Bank of Atlanta, as of September had performed well in lending to borrowers of different 1998. In addition, FANB, which accounts for approxi- income levels, and that the distribution of the bank's lendmately 97 percent of First American's total consolidated ing activity in census tracts of different income levels was assets, received a "satisfactory" rating at its most recent adequate. In addition, examiners found that the bank's CRA performance examination by the Office of the Comp- branches were reasonably distributed throughout its comtroller of the Currency ("OCC"), as of July 1998. FA-FSB munities, including LMI neighborhoods. also received a "satisfactory" rating from the Office of Examiners also found that AmSouth Bank had assisted Thrift Supervision ("OTS") at its most recent CRA perfor- in meeting the credit needs of small businesses in its local mance examination, as of August 1998. communities, and that the bank's small business lending AmSouth has indicated that it does not expect to imple- was well distributed among businesses of different sizes. ment significant changes in the products or services of First The bank made more than 7,800 small business loans, American and that the CRA-related programs and activities totaling approximately $548 million, during the assessment of the combined organization would be based on the cur- period, and approximately 85 percent of the number and rent programs of the two individual organizations. Conse- 36 percent of the total dollar amount of these loans were quently, the Board has carefully considered the CRA per- made to businesses with total annual revenues of $100,000 formance records of AmSouth and First American in or less.21 Examiners noted that approximately 20 percent of evaluating the proposal. the bank's small business loan originations were in LMI census tracts. CRA Performance Record of AmSouth The 1998 CRA performance examination also found that AmSouth Bank had a strong record of community develop- In the 1998 examination of AmSouth Bank, examiners ment investments and a high level of community developfound that the bank offered a variety of loan products ment loans. Examiners noted that AmSouth Bank made designed to meet the credit needs of its local communities, community development investments totaling approxiincluding fixed- and adjustable-rate mortgage loans, Fed- mately $12 million during the assessment period, and held eral Housing Administration and Veterans Administration an additional 14 qualified community development investloans, business loans of varying types and duration, and ments, totaling approximately $18 million. Examiners also consumer loans. Examiners favorably commented on the noted that the bank made 18 qualified community developbank's use of innovative and flexible lending programs to ment loans, totaling approximately $44.5 million, during assist in meeting the credit needs of its communities, the assessment period that assisted in providing housing including LMI borrowers. These programs included the for more than 1,100 LMI families. AmSouth Bank's com- AmSouth Affordable Housing Program, which required munity development loans included a $9.45 million loan to only a 3-percent down payment, allowed higher debt-to- construct a 252-unit apartment project in Orlando, Florida, income ratios than typically accepted, and permitted waiv- that qualified for low-income housing tax credits and a ers of private mortgage insurance requirements. AmSouth $5.1 million loan for the construction and development of Bank originated more than 500 loans, totaling approxi- four apartment complexes in Albertville, Alabama, under mately $27 million, under this program from January 1, the Alabama Housing Finance Authority HOME Program. 1997, through August 27, 1998.19 The bank also partici- CRA Performance Record of First American Examiners at the most recent CRA performance examina- See 41 C.F.R. 60-1.7(a), 60-1.40. Accordingly, the Board has forwarded commenter's contentions to the EEOC for consideration. tion of FANB found that the bank offered a wide variety of 18. The Interagency Questions and Answers Regarding Community Reinvestment provides that an institution's most recent CRA performance evaluation is an important and often controlling factor in the in each of the following communities: Birmingham, Alabama; Tampa, consideration of an institution's CRA record because it represents a St. Petersburg, and Pensacola, Florida; and Chattanooga and Nashdetailed evaluation of the institution's overall record of performance ville, Tennessee. under the CRA by its appropriate federal banking supervisor. 20. For example, examiners found that more than 90 percent of the 64 Federal Register 23,618 and 23,641 (1999). number and dollar amount of the bank's home purchase, home im- 19. Examiners also noted that the AmSouth Affordable Housing provement, home refinancing, and small business loans were made Program loans were marketed by community lending officers of the within the bank's assessment areas. bank to real estate professionals who assisted LMI individuals in 21. The assessment period for the 1998 examination of AmSouth purchasing a home. Six of the bank's community lenders were located Bank was January 1, 1997, to June 30, 1998. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 689 products to address the credit and banking needs of its able mortgage loans and the subsequent swap of these communities, including LMI individuals and communities. securities for securities issued by the Federal Home Loan FANB originated more than 17,900 HMDA-reportable Bank Board and backed by affordable mortgages origiloans, totaling approximately $1.23 billion, and more than nated throughout Tennessee. The bank's other community 11,700 small business loans, totaling approximately development investments included an investment of $600 million, in its assessment areas during the examina- $250,000 in 1996 in a Nashville area loan pool that protion period.22 Examiners reviewed the distribution of the vided downpayment and closing-costs assistance to qualibank's lending in its assessment areas and concluded that fied LMI borrowers. The bank also purchased $707,000 in the bank's lending was reasonably distributed among geog- low-income housing tax credits to finance the construction raphies and individuals with different income levels area of 24 units of affordable housing in Bowling Green, Kenincluding LMI neighborhoods and individuals. tucky 25 Examiners at the 1998 examination favorably noted that Examiners found that FANB's branches and alternative FANB offered two mortgage products that used flexible delivery systems were accessible to all portions of the underwriting criteria and that were designed for LMI bor- bank's communities. Examiners noted that approximately rowers. FANB made 1,571 loans, totaling approximately 22 percent of the bank's branches in Tennessee were $46.5 million, under these flexible mortgage programs located in LMI census tracts, which approximated the during the assessment period in Tennessee, Kentucky, and percentage of census tracts in the state that were LMI Virginia. Examiners also noted that FANB offered a con- census tracts. In addition, examiners concluded that FANB, sumer loan product designed for LMI individuals, which both alone and in conjunction with a variety of community permitted debt-to-income ratios that were higher than nor- groups, provided a high level of community development mal and alternative sources of credit verification.23 services in its assessment areas, including counseling to In addition, the 1998 examination found that FANB had first-time homebuyers and technical assistance to small demonstrated a strong commitment to lending to small businesses and community development organizations.26 businesses located in LMI areas. Examiners favorably noted that 38 percent of the bank's small business loans in HMDA Data the Knoxville, Tennessee, Metropolitan Statistical Area ("MSA") were originated in LMI areas, and 32 percent of The Board also has considered the lending record of Amthe bank's small business loans in the Nashville, Tennes- South and First American in light of comments about the see, MSA were originated in LMI areas. These percentages HMDA data reported by the organizations' subsidiaries. exceeded the respective percentage of small businesses These data show that in 1996, 1997, and 1998, AmSouth located in LMI census tracts in each of these MSAs. Bank originated a higher percentage of its housing-related Furthermore, examiners concluded that FANB had dem- loans in LMI areas in the Birmingham and Mobile, Alaonstrated an excellent record of community development bama, MSAs than lenders in the aggregate in these MSAs. lending and investments within its assessment areas. Dur- In addition, in the Birmingham and Mobile, Alabama, ing the assessment period, FANB originated more than MSAs, the percentage of AmSouth Bank's housing-related 30 community development loans in Tennessee, totaling loan originations to African Americans in 1997 and 1998, approximately $21.3 million,24 and nine community devel- compared with the bank's total housing-related originaopment loans, totaling approximately $2.5 million, in Ken- tions for those years, exceeded or approximated the perfortucky. These loans included a $1.2 million loan to a non- mance of lenders in the aggregate in the relevant MSA. profit organization in Knoxville to renovate a 32-unit These data also show that in 1996, 1997, and 1998, FANB assisted living facility for low-income senior citizens, and originated a higher percentage of its housing-related loans in LMI areas in Tennessee than lenders in the aggregate in a $1.2 million loan to a housing development agency to the state. develop low-income census tracts in Nashville. During the assessment period, FANB also made commu- The data, however, reflect certain disparities in the rates nity development investments totaling approximately of loan applications, originations, and denials among mem- $30 million in Tennessee, and $2.5 million in Kentucky. bers of different racial groups and individuals at different Examiners noted that the largest of these investments was an innovative and complex investment, which involved the securitization of a portion of the bank's portfolio of afford- 25. AmSouth has stated that First American recently made a $1 million investment in the Enterprise Corporation of the Delta, which provides capital, education, and technical support to emerging 22. The 1998 examination of FANB reviewed the bank's activities and expanding small businesses throughout the Mississippi delta during 1996, 1997, and the first quarter of 1998. During this period, region. the bank's assessment area consisted of Tennessee and certain areas of 26. After completion of the 1998 CRA examination of FANB, First Kentucky and Virginia. American acquired Deposit Guaranty National Bank, Jackson, Missis- 23. The 1998 examination also noted that FANB offered special sippi ("Deposit Guaranty"), and merged the bank into FANB, with checking accounts with lower minimum balances and monthly fees FANB surviving the merger. Deposit Guaranty received a "satisfactfor small businesses and LMI individuals. ory" rating from the OCC at its last CRA performance examination 24. Of this amount, approximately $12.9 million was originated in before this merger, as of August 1995. The CRA and fair lending the Nashville MSA, and $2.4 million was originated in the Knoxville policies and programs of FANB were implemented at Deposit Guar- MSA. anty after consummation of the banks' merger. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

690 Federal Reserve Bulletin • October 1999 65 income levels. The Board is concerned when an institu- Branch Closings tion's record indicates such disparities in lending, and believes that all banks are obligated to ensure that their Two commenters expressed concern that consummation of lending practices are based on criteria that assure not only the proposal would result in branch closings and that these safe and sound banking, but also equal access to credit by closings would have adverse effects on the local communicreditworthy applicants regardless of their race or income ties in which the branches are located. AmSouth has stated level. that it currently is reviewing 24 full-service branches of the The Board recognizes, however, that HMDA data alone two organizations for potential closure and has submitted provide an incomplete measure of an institution's lending preliminary and confidential information about these in its community because the data cover only a few catego- branches. AmSouth has indicated that it continues to reries of housing-related lending. HMDA data, moreover, view information about the branches identified for potenprovide only limited information about the covered loans.27 tial closure, and that it has not made a final determination HMDA data, therefore, have limitations that make the data with respect to the closing of any branch. an inadequate basis, absent other information, for conclud- The Board has carefully considered the comments coning that an institution has not adequately assisted in meet- cerning branch closings in light of all the facts of record, ing its community's credit needs or has engaged in illegal including the preliminary branch closing information sublending discrimination. mitted by AmSouth, the branch closing policies of Because of the limitations of HMDA data, the Board has AmSouth and First American, and the record of the two carefully considered the data and comments in light of organizations in opening and closing branches. The Board other information, including information provided by Am- notes that only two of the 24 full-service branches identi- South and First American and confidential supervisory fied for potential closure are located in LMI areas, and that information and examination reports that provide an on- each of these branches is located close to another AmSouth site evaluation of the compliance by the subsidiary deposi- or First American facility. Furthermore, examiners at the tory institutions of AmSouth and First American with the most recent CRA examination of AmSouth Bank and fair lending laws. AmSouth has stated that AmSouth and FANB reviewed the banks' records of opening and closing First American use a centralized underwriting process for branches and found that the banks' branch closings had not all HMDA-reportable loans to ensure the fair and consis- adversely affected the accessibility of banking services in tent application of the banks' underwriting guidelines, and their communities. provide a second review process for all denials of HMDA- The Board also has considered that federal banking law reportable loans. AmSouth also has indicated that both provides a specific mechanism for addressing branch clos- AmSouth and First American employ community lenders ings. Federal law requires an insured depository institution that focus on marketing the organization's credit and other to provide notice to the public and to the appropriate products to communities with large LMI or minority popu- federal supervisory agency before closing a branch.28 The lations. law does not authorize federal regulators to prevent the Furthermore, as noted above, examiners at the most closing of any branch. Any branch closings resulting from recent examination of AmSouth Bank found that the bank the proposal will be considered by the appropriate federal solicited loan applications from all segments of the bank's supervisor at the next CRA examination of the relevant communities. Examiners also found that AmSouth Bank subsidiary depository institution. had adequate policies and procedures to ensure that the evaluations of credit applications were based solely on Conclusion on the Convenience and Needs Factor financial and economic factors, and found no evidence of prohibited discrimination or other illegal credit practices. In its review of the convenience and needs factor under the Examiners at the most recent examination of FANB re- BHC Act, the Board has carefully considered the entire viewed the bank's fair lending policies and procedures and record, including the CRA performance examinations of found these policies and procedures appropriate for ensur- each of the insured depository institutions involved in the ing the bank's compliance with the fair lending laws. proposal, all the information provided by the commenters, Examiners found no evidence of prohibited discrimination AmSouth, and First American, and confidential supervior other illegal credit practices at the most recent examina- sory information.29 Based on all the facts of record, and for tions of FANB and FA-FSB. 28. Section 42 of the Federal Deposit Insurance Act (12U.S.C. § 1831r-l), as implemented by the Joint Policy Statement Regarding Branch Closings (64 Federal Register 34,844 (1999)), requires that a 27. The data, for example, do not account for the possibility that an bank provide the public with at least 30 days notice and the appropriinstitution's outreach efforts may attract a larger proportion of margin- ate federal supervisory agency with at least 90 days notice before the ally qualified applicants than other institutions attract and do not date of the proposed branch closing. The bank also is required to provide a basis for an independent assessment of whether an applicant provide reasons and other supporting data for the closure, consistent who was denied credit was, in fact, creditworthy. Credit history with the institution's written policy for branch closings. problems and excessive debt levels relative to income (reasons most 29. Two commenters criticized the size and scope of AmSouth's frequently cited for a credit denial) are not available from HMDA announced $3.5 billion, five-year lending and community developdata. ment pledge and questioned whether AmSouth would work with Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 691 the reasons discussed above, the Board concludes that concluded that financial and managerial considerations are considerations relating to the convenience and needs fac- consistent with approval of the proposal. tor, including the CRA performance records of the relevant The Board also has considered the competitive effects of insured depository institutions, are consistent with ap- the proposed acquisition by AmSouth of the nonbanking proval of the proposal. subsidiaries of First American. FA-FSB has eight branches located in Virginia and Georgia, and competes with Nonbanking Activities AmSouth only in the Chattanooga, Tennessee, banking market. For the reasons discussed above, the Board has AmSouth also has filed notice under section 4(c)(8) of the concluded that the acquisition of First American's subsid- BHC Act to acquire FA-FSB and First American Commu- iary depository institutions, including FA-FSB, is not likely nity Development Corporation and thereby engage in oper- to have any significantly adverse effects in the Chattaating a savings association and in community development nooga, Tennessee, banking market or any other relevant activities. The Board has determined by regulation that banking market. Numerous competitors also would remain operation of a savings association and community develop- in the market for community development services, and the ment activities are, within certain limits, closely related to market structure for providing these services would remain banking for purposes of the BHC Act.30 AmSouth has unconcentrated. Based on all the facts of record, the Board committed to conduct these nonbanking activities in accor- concludes that it is unlikely that significantly adverse comdance with the limitations set forth in Regulation Y and the petitive effects would result from the nonbanking acquisi- Board's orders and interpretations governing each of these tions proposed in the transaction. activities. AmSouth has indicated that consummation of the pro- In order to approve a notice under section 4(c)(8) of the posal would provide current and future customers of the BHC Act, the Board also must determine that the proposed two organizations greater convenience. AmSouth also has activities are a proper incident to banking, that is, that the stated that the proposal would permit the combined organiproposal "can reasonably be expected to produce benefits zation to achieve greater operational efficiencies and econto the public . . . that outweigh possible adverse effects, omies of scale, and that these efficiencies and economies of such as undue concentration of resources, decreased or scale would strengthen AmSouth's ability to compete in unfair competition, conflicts of interests, or unsound bank- the markets in which it operates. In addition, as the Board ing practices."31 As noted above, FA-FSB received a "sat- has previously noted, there are public benefits to be derived isfactory" rating from the OTS at its most recent CRA from permitting capital markets to operate so that bank performance examination, as of August 1998. holding companies can make potentially profitable invest- As part of its evaluation of the public interest factors, the ments in nonbanking companies and from permitting bank- Board considers the financial condition and managerial ing organizations to allocate their resources in the manner resources of the notificant and its subsidiaries, including they consider to be most efficient when such investments the companies to be acquired, and the effect of the pro- and actions are consistent, as in this case, with the relevant posed transaction on those resources. For the reasons noted considerations under the BHC Act.32 above, and based on all the facts of record, the Board has The Board also concludes that the conduct of the proposed nonbanking activities within the framework of Regulation Y and prior Board precedent is not likely to result community groups located throughout the organization's franchise to in adverse effects, such as undue concentration of redevelop and implement the pledge. The Board previously has stated sources, conflicts of interests, or unsound banking practhat, to gain approval of a proposal to acquire an insured depository institution, an applicant must demonstrate a satisfactory record under tices, that would outweigh the public benefits of the prothe CRA without reliance on plans or commitments for future action. posal, such as increased customer convenience and gains in See NationsBank Corporation, 84 Federal Reserve Bulletin 858, 876 efficiency. Accordingly, based on all the facts of record, the (1998); Totalbank Corporation, 81 Federal Reserve Bulletin 876 Board has determined that the balance of public interest (1995). The Board also previously has noted that, while communications with community groups provide a valuable method of assessing factors that the Board must consider under the proper and determining how an institution may best address the credit needs incident to banking standard of section 4(c)(8) of the BHC of the community, the CRA does not require depository institutions to Act are consistent with approval of AmSouth's notice. enter into agreements with any organization. See Fifth Third Bancorp, 80 Federal Reserve Bulletin 838 (1994). Accordingly, the Board has Conclusion carefully considered the actual record of past performance of the insured depository institution subsidiaries of AmSouth and First American under the CRA, and has reviewed AmSouth's pledge only Based on the foregoing, and in light of all the facts of as an indication of the company's intent to maintain and strengthen record, the Board has determined that the application and these records of past performance. The Board notes, moreover, that notice should be, and hereby are, approved.33 The Board's the future activities of the combined organization, including efforts to implement the proposed lending and community development plan, would be reviewed by the appropriate federal supervisors of the relevant depository institutions in future performance examinations, 32. See, e.g., Banc One Corporation, 84 Federal Reserve Bulletin and would be considered by the Board in future applications by 553 (1998); First Union Corporation, 84 Federal Reserve Bulletin AmSouth to acquire an insured depository institution. 489 (1998). 30. See 12 C.F.R. 225.28(b)(4)(ii) and (12). 33. The Board received comments, including numerous untimely 31. 12 U.S.C. § 1843(c)(8). comments, requesting that the Board hold a public meeting or hearing Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

692 Federal Reserve Bulletin • October 1999 65 approval is specifically conditioned on compliance by extended for good cause by the Board or by the Federal AmSouth with all the commitments made in connection Reserve Bank of Atlanta, acting pursuant to delegated with this application and with the conditions stated or authority. referred to in this order. The Board's determination on the By order of the Board of Governors, effective nonbanking activities also is subject to all the terms and August 30, 1999. conditions set forth in Regulation Y, including those in sections 225.7 and 225.25(c) (12 C.F.R. 225.7 and This action was taken pursuant to the Board's Rules Regarding 225.25(c)), and to the Board's authority to require such Delegation of Authority (12 C.F.R. 265.4(b)(1)) by a committee of Board members. Voting for this action: Governors Kelley, Meyer, and modification or termination of the activities of a bank Ferguson. Absent and not voting: Chairman Greenspan and Governor holding company or any of its subsidiaries as the Board Gramlich. finds necessary to ensure compliance with, and to prevent evasion of, the provisions of the BHC Act and the Board's ROBERT DEV. FRIERSON regulations and orders thereunder. For purposes of this Associate Secretary of the Board action, the commitments and conditions relied on by the Board in reaching its decision are deemed to be conditions Appendix imposed in writing by the Board in connection with its findings and decision and, as such, may be enforced in proceedings under applicable law.34 Summary of Market Structure in Banking Markets Without Divestitures The merger with First American shall not be consummated before the thirtieth calendar day following the effec- Tennessee tive date of this order, or such shorter period as agreed to by the Attorney General of the United States, and the Cleveland proposal shall not be consummated later than three months after the effective date of this order, unless such period is AmSouth is the sixth largest depository institution in the market, controlling deposits of $64 million, representing approximately 7.1 percent of market deposits. First American is the third largest depository institution in the market, on the proposal. Section 3 of the BHC Act does not require the Board to hold a public hearing on an application unless the appropriate controlling deposits of $129.5 million, representing apsupervisory authority for the bank to be acquired makes a timely proximately 14.3 percent of market deposits. After the written recommendation of denial. The Board has not received such a proposed merger, AmSouth would become the second largrecommendation from the appropriate supervisory authorities. The est depository institution in the market, controlling depos- Board's regulations provide for a hearing under section 4 of the BHC Act if there are disputed issues of material fact that cannot be resolved its of $193.5 million, representing approximately 21.3 perin some other manner. See 12 C.F.R. 225.25(a)(2). Under its rules, the cent of market deposits. On consummation of the proposal, Board also may, in its discretion, hold a public meeting or hearing on the HHI would increase 202 points to 1790, and eight other an application to acquire a bank if a meeting or hearing is necessary or competitors would remain in the market. appropriate to clarify factual issues related to the application and to provide an opportunity for testimony. 12 C.F.R. 225.16(e). Nashville The Board has carefully considered the requests for a public meeting or hearing in light of all the facts of record. In the Board's view, AmSouth is the 12th largest depository institution in the commenters have had ample opportunity to submit their views and, in market, controlling deposits of $186.9 million, representfact, have submitted written comments that have been carefully con- ing approximately 1.3 percent of market deposits. First sidered by the Board in acting on the proposal. The requests fail to American is the largest depository institution in the market, identify disputed issues of fact that are material to the Board's decision and that may be clarified by a public meeting or hearing. controlling deposits of $3.6 billion, representing approxi- Commenters have provided substantial written comments that have mately 25 percent of market deposits. After the proposed been carefully considered by the Board, and the requests fail to show merger, AmSouth would become the largest depository why a public meeting or hearing is necessary for the proper presentainstitution in the market, controlling deposits of approxition or consideration of commenters' views. For these reasons, and mately $3.8 billion, representing.approximately 26.3 perbased on all the facts of record, the Board has determined that a public meeting or hearing is not required or warranted in this case. Accord- cent of market deposits. The HHI would increase 64 points ingly, the requests are hereby denied. to 1483, and 29 other competitors would remain in the 34. Certain commenters also requested that the Board delay action market. on the proposal and investigate the allegations made by the commenters, including allegations that AmSouth and First American have violated the fair lending laws. The Board has accumulated a signifi- Tennessee and Georgia cant record in this case, including reports of examination, supervisory information, public reports and information, and public comment. In Chattanooga addition, the commenters have had ample opportunity to submit their views and, in fact, have provided substantial written submissions that AmSouth is the fourth largest depository institution in have been considered carefully by the Board in acting on the proposal. the market, controlling deposits of $584.2 million, repre- Based on a review of all the facts of record, the Board concludes that senting approximately 12.2 percent of market deposits. the record in this case is sufficient to warrant Board consideration and action on the proposal at this time, and further delay of consideration First American is the third largest depository institution in of the proposal or an extension of the comment period is not war- the market, controlling deposits of $648.3 million, repreranted. senting approximately 13.4 percent of market deposits. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 693 After the proposed merger, AmSouth would become the Bank Iowa and Branch compete in the Montgomery largest depository institution in the market, controlling County, Iowa, banking market.6 The Board has reviewed deposits of $1.2 billion, representing approximately the competitive effects of the proposal in this market in 25.6 percent of market deposits. On consummation of the light of all the facts of record, including the characteristics proposal, the HHI would increase 331 points to 1668, and of the market and the projected increase in the concentra- 21 other competitors would remain in the market. tion of total deposits in insured depository institutions in this market ("market deposits")7 as measured by the Bank Iowa Herfindahl-Hirschman Index ("HHI") under the Depart- Red Oak, Iowa ment of Justice Merger Guidelines ("DOJ Guidelines").8 Bank Iowa is the fourth largest depository institution in Order Approving Acquisition of a Branch the market, controlling $21.9 million in deposits, representing 11.5 percent of market deposits. Branch represents the Bank Iowa, a state member bank, has applied under sec- fifth largest depository institution in the market, controlling tion 18(c) of the Federal Deposit Insurance Act $17.8 million in deposits, representing 9.4 percent of mar- (12 U.S.C. § 1828(c)) (the "Bank Merger Act") to acquire ket share. On consummation of this proposal, Bank Iowa the branch of U.S. Bank, N.A., Minneapolis, Minnesota would become the second largest depository institution in ("U.S. Bank"), located at 802 Broadway, Red Oak, Iowa the market, controlling deposits of $39.7 million, represent- ("Branch").1 Bank Iowa proposes to merge Branch into a ing 20.9 percent of market deposits. The HHI would innearby Bank Iowa branch on consummation of this pro- crease by 216 points to 2941. posal. As the Board has indicated in previous cases, in a market Notice of the application, affording interested persons an in which the competitive effects of a proposal exceed the opportunity to submit comments, has been given in accor- DOJ Guidelines, the Board will consider whether other dance with the Bank Merger Act and the Board's Rules of factors tend to mitigate the competitive effects of the Procedure (12 C.F.R. 262.3(b)). As required by the Bank proposal. The number and strength of factors necessary to Merger Act, reports on the competitive effects of the mitigate the competitive effects of a proposal depend on merger were requested from the United States Attorney the level of market concentration and size of the increase in General and the Federal Deposit Insurance Corporation. market concentration. In this case, the structural effect of The time for filing comments has expired, and the Board the proposed transaction would marginally exceed the DOJ has considered the application and all the facts of record in Guidelines. light of the factors set forth in the Bank Merger Act. Several factors, including the structure of the Montgom- Bank Iowa controls $72.6 million in deposits, represent- ery County banking market, indicate that the likely effect ing less than one percent of total deposits in depository of consummation of this proposal on competition in the institutions2 in Iowa.3 Branch controls $17.8 million in market would not be significantly adverse. Five depository deposits, and, on consummation of this proposal, Bank institutions, including Bank Iowa, would operate in the Iowa would control deposits of $92.4 million, representing market after consummation of this proposal. The largest less than one percent of total deposits in depository institu- competitor in the market controls approximately 45 percent tions in the state. of market deposits and two additional competitors (other The Bank Merger Act prohibits the Board from approv- than Bank Iowa) control approximately 17 percent and ing an application if the proposal would result in a monopoly or would be in furtherance of any attempt to monopolize the business of banking.4 The Bank Merger Act also 6. The Montgomery County banking market is defined as Montgomprohibits the Board from approving a proposal that would ery County, plus Indian Creek township in Mills County, all in Iowa. substantially lessen competition or tend to create a monop- 7. All market data are as of June 30, 1998. Market share data are based on calculations that include the deposits of thrift institutions oly in any relevant market, unless the Board finds that the weighted at 50 percent. The Board previously has indicated that thrift anticompetitive effects of the proposed transaction are institutions have become, or have the potential to become, significant clearly outweighed in the public interest by the probable competitors of commercial banks. See, e.g., Midwest Financial Group, effects of the transaction in meeting the convenience and 75 Federal Reserve Bulletin 386 (1989); National City Corporation, needs of the community to be served.5 70 Federal Reserve Bulletin 743 (1984). Thus, the Board regularly has included thrift deposits in the calculation of market share on a The Board has carefully considered the competitive ef- 50-percent weighted basis. See, e.g., First Hawaiian Inc., 77 Federal fects of the proposal as required by the Bank Merger Act. Reserve Bulletin 42 (1991). 8. Under the DOJ Guidelines, 49 Federal Register 26,823 (1984), a market in which the post-merger HHI is above 1800 is considered to be highly concentrated. The Department of Justice has informed the 1. Bank Iowa would acquire Branch from Liberty Bank, FSB, Board that a bank merger or acquisition generally will not be chal- Arnolds Park, Iowa, which acquired eight Iowa branches from U.S. lenged (in the absence of other factors indicating anticompetitive Bank in May 1999. effects) unless the post-merger HHI is at least 1800 and the merger or 2. In this context, depository institutions include commercial banks, acquisition increases the HHI by at least 200 points. The Department savings banks, and savings associations. of Justice has stated that the higher than normal HHI thresholds for 3. All state banking data are as of December 31, 1998. screening bank mergers or acquisitions for anticompetitive effects 4. 12 U.S.C. § 1828(c)(5)(A). implicitly recognize the competitive effects of limited-purpose lenders 5. 12 U.S.C. § 1828(c)(5)(B). and other nondepository financial institutions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

694 Federal Reserve Bulletin • October 1999 65 16 percent of market deposits. Furthermore, Branch does Voting for this action: Chairman Greenspan and Governors Kelley, not appear to be a strong competitor in the market. U.S. Meyer, Ferguson and Gramlich. Bancorp entered the market through the acquisition of Branch in 1997, and Branch has lost market share in the JENNIFER J. JOHNSON Secretary of the Board past two years. The Department of Justice has advised the Board that Manufacturers and Traders Trust Company consummation of the proposal would not likely have a Buffalo, New York significantly adverse effect on competition in any relevant market. Order Approving the Acquisition of Branches and After carefully reviewing all the facts of record, and for Establishment of Bank Branches the reasons discussed in this order, the Board concludes that consummation of the proposal would not have any Manufacturers and Traders Trust Company ("M&T"), a significantly adverse effects on competition or on the constate member bank, has applied under section 18(c) of the centration of banking resources in the Montgomery County Federal Deposit Insurance Act (12 U.S.C. § 1828(c)) banking market or in any other relevant banking market. ("Bank Merger Act") to acquire 32 branches of The Chase Accordingly, based on all the facts of record, the Board has Manhattan Bank, New York, New York ("Chase"). M&T determined that competitive factors are consistent with also has applied under section 9 of the Federal Reserve Act approval of the proposal. ("FRA") (12 U.S.C. §321) to establish branches at the locations of the branches to be acquired, as described in Financial, Managerial and Other Considerations Appendix A. Notice of the applications, affording interested persons The Bank Merger Act also requires the Board to consider an opportunity to submit comments, has been given in the financial and managerial resources and future prospects accordance with the Bank Merger Act and the Board's of the companies and banks involved in the proposal, and Rules of Procedure (12 C.F.R. 262.3(b)). As required by the convenience and needs of the communities to be the Bank Merger Act, reports on the competitive effects of served. The Board has reviewed carefully these factors in the merger were requested from the United States Attorney light of all the factors of record, including supervisory General and the Federal Deposit Insurance Corporation reports of examination assessing the financial and manage- ("FDIC"). The time for filing comments has expired, and rial resources of the organizations. Based on these and all the Board has considered the applications and all the facts the facts of record, the Board concludes that the financial of record in light of the factors set forth in the Bank Merger and managerial resources and future prospects of Bank Act and section 9 of the FRA. Iowa are consistent with approval. M&T is the seventh largest commercial banking organi- In considering the convenience and needs factor, the zation in New York, controlling deposits of $14.2 billion, Board has reviewed the record of Bank Iowa under the representing 3.4 percent of total deposits in commercial Community Reinvestment Act ("CRA"). The Board notes banking organizations in the state.1 Chase is the largest that Bank Iowa received a "satisfactory" rating at its last commercial banking organization in New York, controlling CRA performance examination by the OCC, as of Decemdeposits of 95.3 billion, representing 22.4 percent of total ber 1, 1997. Based on all the facts of record, the Board deposits in commercial banking organizations in the state. concludes that convenience and needs considerations, in- This proposal involves the acquisition by M&T of cluding the CRA performance record of Bank Iowa, are 32 branches of Chase that are located primarily in banking consistent with approval of the proposal. markets in upstate New York. Chase would continue to Based on the foregoing and all the facts of record, the operate 389 branches throughout New York State follow- Board has determined that this application should be, and ing the transaction. On consummation of this proposal, hereby is, approved. The Board's approval of this proposal M&T would remain the seventh largest commercial bankis conditioned on compliance by Bank Iowa with the ing organization in New York, and would control deposits commitments made in connection with this application. of $14.8 billion, representing 3.6 percent of total deposits For purposes of this action, the commitments and condiin commercial banking organizations in the state. tions relied on in reaching this decision are conditions The Bank Merger Act prohibits the Board from approvimposed in writing by the Board and, as such, may be ing an application if the proposal would result in a monopenforced in proceedings under applicable law. oly or would be in furtherance of any attempt to monopo- The acquisition of Branch may not be consummated lize the business of banking.2 The Bank Merger Act also before the fifteenth calendar day after the effective date of prohibits the Board from approving a proposal that would this order, and this proposal may not be consummated later substantially lessen competition or tend to create a monopthan three months after the effective date of this order, oly in any relevant market, unless the Board finds that the unless such period is extended by the Board or by the anticompetitive effects of the proposed transaction are Federal Reserve Bank of Chicago, acting pursuant to delegated authority. By order of the Board of Governors, effective 1. All banking data are as of June 30, 1998. August 18, 1999. 2. 12 U.S.C. § 1828(c)(5)(A). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 695 clearly outweighed in the public interest by the probable senting 27.3 percent of market deposits. The HHI would effects of the transaction in meeting the convenience and increase by 324 to 1952. needs of the community to be served.3 As the Board has indicated in previous cases, in a market The Board has carefully considered the competitive ef- in which the competitive effects of a proposal exceed the fects of the proposal as required by the Bank Merger Act. DOJ Guidelines, the Board will consider whether other M&T and Chase currently compete in the Albany, Bing- factors tend to mitigate the competitive effects of the hamton, Buffalo, Elmira-Corning, and Jamestown banking proposal. The number and strength of factors necessary to markets in New York.4 The Board has carefully reviewed mitigate the competitive effects of a proposal depend on the competitive effects of the proposal in each of these the level of market concentration and size of the increase in markets in light of all the facts of record, including the market concentration. characteristics of the markets and the projected increase in In this case, nine depository institutions, including M&T, the concentration of total deposits in insured depository would remain in the Jamestown banking market after coninstitutions in these markets ("market deposits")5 as mea- summation of the proposal. Three of the largest competisured by the Herfindahl-Hirschman Index ("HHI") under tors in the market, excluding M&T, are multistate banking the Department of Justice Merger Guidelines ("DOJ organizations. In addition, three competitors will have mar- Guidelines").6 The Board also has carefully examined the ket shares exceeding 10 percent, including two competitors number of competitors that would remain in each of the with market shares exceeding 20 percent. The Jamestown banking markets after consummation of the proposal. Con- market also appears to be reasonably attractive for entry. summation of the proposal would be consistent with the The unemployment rate in the market has fallen from DOJ Guidelines and prior Board decisions in the Albany, 7.2 percent to 5 percent over the past five years, personal Binghamton, Buffalo, and Elmira-Corning banking mar- income grew by 24 percent and nonagricultural employkets.7 The proposal would exceed the DOJ guidelines in ment grew by 4.1 percent in that time. Furthermore, two the Jamestown banking market. depository institutions have entered the Jamestown market Jamestown Banking Market. M&T is the fifth largest in the last several years. A de novo savings bank opened in depository institution in the Jamestown banking market, 1995, and a community bank entered the market in 1997 by controlling $93.1 million in deposits, representing 8.6 per- acquiring four branches in the market. Since 1994 the HHI cent of market deposits.8 Chase is the third largest deposi- for the Jamestown market has steadily declined, from 1975 tory institution in the Jamestown banking market, control- to 1628 at present. The Board believes that these factors ling $201.2 million in deposits, representing 18.7 percent indicate that the likely effect of consummation of this of market deposits. On consummation of this proposal, proposal on competition in the Jamestown banking market M&T would become the largest depository institution in would not be significantly adverse. the market, controlling $294.3 million in deposits, repre- Views of the Department of Justice and Conclusions. The Department of Justice has advised the Board that consummation of the proposal would not likely have a significantly adverse effect on competition in any relevant 3. 12 U.S.C. § 1828(c)(5)(B). 4. These banking markets are described in Appendix B. market. 5. Market share data are based on calculations that include the After carefully reviewing all the facts of record and for deposits of thrift institutions weighted at 50 percent. The Board the reasons discussed in this order and its appendices, the previously has indicated that thrift institutions have become, or have Board concludes that consummation of the proposal would the potential to become, significant competitors of commercial banks. not have any significantly adverse effects on competition or See, e.g., Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989); National City Corporation, 70 Federal Reserve Bulletin 743 on the concentration of banking resources in any of the five (1984). Thus, the Board regularly has included thrift deposits in the banking markets in which M&T and Chase compete or in calculation of market share on a 50-percent weighted basis. See, e.g., any other relevant banking market. Accordingly, the Board First Hawaiian Inc., 77 Federal Reserve Bulletin 42 (1991). has determined that competitive factors are consistent with 6. Under the DOJ Guidelines, 49 Federal Register 26,823 (1984), a approval of the proposal. market in which the post-merger HHI is between 1000 and 1800 is considered to be moderately concentrated. A market in which the post-merger HHI is above 1800 is considered to be highly concen- Other Factors under the Bank Merger Act trated. The Department of Justice has informed the Board that a bank merger or acquisition generally will not be challenged (in the absence The Bank Merger Act also requires the Board, in acting on of other factors indicating anticompetitive effects) unless the postmerger HHI is at least 1800 and the merger or acquisition increases an application, to take into consideration the financial and the HHI by at least 200 points. The Department of Justice has stated managerial resources and future prospects of the existing that the higher than normal HHI thresholds for screening bank mergand proposed institutions, and the convenience and needs ers or acquisitions for anticompetitive effects implicitly recognize the of the community to be served. competitive effects of limited-purpose lenders and other nondepository financial institutions. Market data for these banking markets after consummation of the A. Financial, Managerial, and Future Prospects proposal are described in Appendix C. 7. Market data for these banking markets after consummation of the The Board has carefully considered the financial and manproposal are described in Appendix C. agerial resources and future prospects of M&T, and the 8. In this context, depository institutions include commercial banks, savings banks, and savings associations. effect of its acquisition of the Chase branches on those Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

696 Federal Reserve Bulletin • October 1999 65 resources and prospects in light of all the facts of record. antidiscrimination laws and regulations. Examiners found As part of its consideration, the Board has reviewed rele- that M&T responded to the credit needs of its assessment vant reports of examination and other supervisory informa- areas by originating 95 percent of its home purchase and tion prepared by the Reserve Banks and other federal home improvement loans and refinancings ("HMDAagencies. Based on these and other facts of record, the related loans"),11 small farm and small business loans, and Board concludes that considerations relating to the finan- community development loans within its assessment areas. cial and managerial resources and future prospects of M&T The geographic distribution of these loans was deemed and the Chase branches are consistent with approval of the excellent. The percentage of M&T's HMDA-related loans proposal. to low-income borrowers was found to be lower than the percentage of low-income families in all assessment areas. B. Convenience and Needs Considerations Examiners noted, however, that this also was true of M&T's peer institutions and appeared to be primarily due In acting on this proposal, the Board also must consider the to the high cost of housing compared with family income convenience and needs of the communities to be served throughout New York State. Examiners noted, moreover, and take into account the records of the relevant depository that when the number of HMDA-related loans in an assessinstitutions under the Community Reinvestment Act ment area was compared with the number of owner- (12 U.S.C §§ 2901 et seq.) ("CRA"). The CRA requires occupied housing units in that area, M&T's proportion of the federal financial supervisory agencies to encourage loans was greater in LMI communities than in non-LMI financial institutions to help meet the credit needs of local communities. Examiners also found that M&T demoncommunities in which they operate, consistent with their strated a good record of lending to small businesses of safe and sound operation, and requires the appropriate different sizes. federal supervisory authority to take into account an institu- The 1998 Examination deemed M&T's record of meettion's record of meeting the credit needs of its entire ing the credit needs of its communities through community community, including low- and moderate-income ("LMI") development lending to be excellent. Examiners found neighborhoods, in evaluating bank expansion proposals. that M&T had total community development lending of The Board has carefully considered the convenience and $103.9 million, $69.5 million of which represented loans needs factor and the CRA performance record of M&T in or lines of credit originated or increased during the examilight of all the facts of record, including public comments nation period. Examiners also cited M&T's use of a variety on the proposal.9 of innovative or flexible lending practices that address the As provided in the CRA, the Board has evaluated the credit needs of LMI individuals and geographies. These convenience and needs factor in light of evaluations by the practices include a program that provides borrowers with appropriate federal supervisors of the CRA performance low-interest loans to help them meet closing costs on other records of the relevant institution. An institution's most loans, and a "$500 down" program that allows borrowers recent CRA performance evaluation is a particularly impor- in certain cities with household incomes below 80 percent tant consideration in the applications process because it of the median to purchase a home with a $500 down represents a detailed on-site evaluation of the institution's payment. During the examination period, M&T made overall record of performance under the CRA by the appro- 64 loans for $2.7 million under the $500 down program. priate federal financial supervisory agency.10 M&T also participates in the State of New York Mortgage M&T received an "outstanding" rating in the most Association ("SONYMA") low interest rate and new conrecent examination of its CRA performance by the Federal struction incentive program, which provides low-interest, Reserve Bank of New York, as of May 1998 ("1998 high loan-to-value mortgage loans to first-time homebuy- Examination"). The examination found no evidence of any ers with incomes below a ceiling set by SONYMA. M&T credit practices that violated the substantive provisions of made 940 of these loans totaling $73 million during the examination period. Examiners rated M&T's CRA-related investment perfor- 9. Two community groups ("Protestants") submitted timely written mance to be "high satisfactory," and found that M&T has comments opposing the proposal. Protestants note that Chase previ- made a significant level of qualified investments not rouously entered into a voluntary $18.1 billion, five year community tinely provided by other banks and private investors. reinvestment commitment in connection with the 1996 merger of M&T's qualified investments totaled $9.3 million, and Chemical Banking Corporation and Chase Manhattan Corporation. Protestants express concern that Chase may seek to avoid compliance supported community services, revitalization and stabilizawith this commitment by selling its branches to competitors. The tion projects, affordable housing, and economic develop- Board notes that the BHC Act and the CRA require the Board to ment projects. Examiners also found that M&T made good consider the record and resources of the applicant, which in this case use of innovative and complex investments to support is M&T, and its subsidiaries, and do not provide for review of the record or resources of the selling institution. The Board also notes that community development initiatives, and that overall Chase states that it has already reached 88 percent of the $18.1 billion nationwide goal. 10. The Interagency Questions and Answers Regarding Community Reinvestment provide that a CRA examination is an important and 11. Home purchase and home improvement loans and refinancings often controlling factor in the consideration of an institution's CRA are reported under the Home Mortgage Disclosure Act (12 U.S.C. record. See 64 Federal Register 23,641 (1999). § 2801 et seq.) ("HMDA"). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 697 M&T's investments demonstrated a good level of respon- The Board is concerned when an institution's record siveness to credit and community development needs. indicates disparities in lending to minority applicants, and Examiners rated M&T's record of providing banking believes that all banks are obligated to ensure that their services in its assessment areas as "outstanding," and lending practices are based on criteria that assure not only found that M&T's banking services and delivery systems safe and sound lending, but also equal access to credit by were accessible to virtually all geographies and individuals credit applicants regardless of race. The Board recognizes, within those areas. At the time of the 1998 Examination of however, that HMDA data alone provide an incomplete M&T's 155 branches, at least one was in each of its measure of an institution's lending in its community. The assessment areas, and M&T also had 138 automatic teller Board also recognizes that HMDA data have limitations machines ("ATMs"), including ten ATMs in low-income that make the data an inadequate basis, absent other inforgeographies that offered check-cashing services. Examin- mation, for conclusively determining that an institution has ers also noted that M&T also offers 24-hour telephone and engaged in illegal discrimination in making lending decipersonal computer banking services. From July 1996 sions. through December 1997, M&T opened 39 branches, closed In light of the limitations of HMDA data, the Board five, relocated two and consolidated one. Examiners found considers the results of fair lending examinations and other that the branch openings had improved the accessibility of sources of information in evaluating allegations that a M&T's services in LMI and other communities. Four of banking organization has violated fair lending. In this case, the 39 new branches were in LMI communities, and no the CRA performance examination of M&T indicates that branches were closed in LMI communities. examiners did not find evidence of discrimination or other While M&T has not indicated that any branches will be illegal credit practices. The examination also stated that closed or consolidated at the time of the transaction, any directors and senior management of M&T have developed subsequent closures or consolidations of the branches ac- policies, procedures and training programs to ensure that quired in this transaction would be reviewed by the Federal the bank does not illegally discourage or prescreen appli- Reserve System in the course of the examination process. cants. Also, as noted above, M&T was found to have an This record would be taken into account in assessing the excellent geographic distribution of loans throughout its CRA performance of M&T, in accordance with the Joint assessment areas, including LMI and minority communi- Interagency Policy Statement Regarding Branch Closings ties, and to offer a wide variety of loan products. ("Interagency Statement"), and in reviewing future appli- The Board has carefully considered the entire record, cations involving M&T.12 including public comments in this case, in reviewing the Examiners described M&T as a leader in providing convenience and needs factors under the relevant banking community development services that focus on LMI indi- statutes. Based on a review of the entire record of perforviduals in its assessment areas. This included sponsoring mance, including information provided by Protestants, relseminars and similar events concerning affordable housing evant reports of examination, and other supervisory inforand personal financial management, as well as small busi- mation, the Board concludes that the convenience and ness seminars and workshops. Examiners found that M&T needs considerations, including the CRA performance provided financial technical assistance to community de- record of M&T, are consistent with approval of these velopment, housing, educational, and charitable organiza- applications. tions that benefit LMI individuals, and that M&T employees also serve on the boards of these groups. Conclusion One Protestant criticized the lending record of M&T's subsidiary, M&T Mortgage Corporation, in the New York City Metropolitan Statistical Area ("MSA"), the Buffalo, Based on the foregoing and all the facts of record, the New York MSA, and the Syracuse, New York MSA. Board has determined that these applications should be, Specifically, the Protestant asserted that a significant dis- and hereby are, approved. The Board's approval of this parity in denial rates existed between African Americans proposal is conditioned on compliance by M&T with the and whites in M&T Mortgage Corporation's lending in the commitments made in connection with these applications. New York City MSA and in the Buffalo MSA. Protestant For purposes of this action, the commitments and condiasserted that, in the Syracuse MSA, M&T Mortgage Cor- tions relied on in reaching this decision are conditions poration made no conventional home purchase loans to imposed in writing by the Board and, as such, may be either African Americans or Latinos. enforced in proceedings under applicable law. The acquisition of the Chase branches may not be consummated before the fifteenth calendar day after the effective date of this order, and this proposal may not be 12. Protestants have expressed concern over the possibility that consummated later than three months after the effective M&T may close or consolidate some of the branches on consumma- date of this order, unless such period is extended by the tion of this proposal. In addition to reviewing any such closures or Board or by the Federal Reserve Bank of New York, acting consolidations in the manner described above, the Board notes that pursuant to delegated authority. M&T's past branch closures have been in accordance with M&T's By order of the Board of Governors, effective written branch closing policy, which conforms to the Interagency Statement (64 Federal Register 34,844 (1999)). August 16, 1999. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

698 Federal Reserve Bulletin • October 1999 65 Voting for this action: Chairman Greenspan and Governors Kelley, 2. The Binghamton banking market is approximated by Meyer, Ferguson, and Gramlich. Broome and Tioga Counties, plus the municipalities of Alton, Coventry, Greene, and Smithville in Chenango JENNIFER J. JOHNSON County, all in New York, and Susquehanna County, Secretary of the Board Pennsylvania. 3. The Buffalo banking market is approximated by Erie Appendix A and Niagara Counties, plus portions of Cattaraugus, Orleans, and Wyoming Counties, all in New York. Branches of Chase Manhattan to be established by M&T 4. The Elmira-Corning banking market is approximated Bank (All in New York) by Chemung County, the municipalities of Alfred, Andover, and Independence in Allegany County, the 1. 23 Main Street, Bemus Point. municipalities of Catharine, Cayuta, Dix, Orange, 2. 2 Court Street, Binghamton. Montour, Reading, and Tyrone in Schuyler, and the 3. 33 West State Street, Binghamton. municipalities of Addison, Bath, Bradford, Cameron, 4. 904 Broadway, Buffalo. Campbell, Canisteo, Caton, Erwin, Greenwood, Harts- 5. 307 Conklin Avenue, Binghamton. ville, Hornby, Jasper, Lindley, Rathbone, Thurston, 6. 2-8 East Market Street, Corning. Troupsbury, Wayne, West Union, Woodhull, Urbana, 7. 6348 Transit Road, Depew. and the city and town of Corning in Steuben County, 8. 149-153 Robinson Street, Binghamton. all in New York. 9. 295 Main Street, Buffalo. 5. The Jamestown banking market is approximated by 10. 1310 North Street, Endicott. Chautauqua County, New York, plus the Allegheny 11. 20 West Main Street, Falconer. Indian Reservation and the towns of Cold Springs, 12. 181 Clinton Street, Binghamton. Conewango, Leon, Napoli, New Albion (less the vil- 13. 19 East Main Street, Frewsburg. lage of Cattaraugus), Randolph, and South Valley in 14. 1085 Chenango Street, Town of Fenton. Cattaraugus County, New York. 15. One West Sixth Street, Jamestown. 16. 2-8 East Third Street, Jamestown. 17. 737 Foote Avenue, Jamestown. Appendix C 18. 1635 West Third Street, Jamestown. 19. 20 Jenison Avenue, Johnson City. Banking Markets in which Consummation of the 20. 5 Mile Point Shopping Center, Crescent Drive, Kirk- Proposal Would Not Exceed the DOJ Guidelines wood. 21. 281 East Fairmount Avenue, Lakewood. Albany 22. 76 South Erie Street, Mayville. After consummation of the proposal, M&T would control 23. 5 Niagara Square, Buffalo. 2.5 percent of market deposits and would remain the tenth 24. 58 East Pulteney Street, Corning. largest of 31 depository institutions in the market. The HHI 25. Oakdale Mall, Store 17, Reynolds Road & Harry L. would decrease 1 point to 1063. Drive, Johnson City. 26. 6532-34 East Quaker Road, Orchard Park. Binghamton 27. 195 Front Street, Owego. After consummation of the proposal, M&T would control 28. 1766 Union Street, Niskayuna. 18.1 percent of market deposits and would become the 29. 2225 Colvin Boulevard, Town of Tonawanda. second largest of 13 depository institutions in the market. 30. 4481 Vestal Parkway East, Vestal. The HHI would increase 96 points to 2409. 31. Main Street & 119th Street, Whitney Point. 32. 5930 Main Street, Williamsville. Buffalo After consummation of the proposal, M&T would control Appendix B 37.7 percent of market deposits and would remain the largest of 16 depository institutions in the market. The HHI Banking Markets in New York in which M&T and Chase would increase 46 points to 2521. Compete Elmira-Corning 1. The Albany banking market is approximated by Al- After consummation of the proposal, M&T would control bany, Columbia, Fulton, Greene, Hamilton, Montgom- 7.5 percent of market deposits and would become the ery, Rensselaer, Saratoga, Schenectady, Schoharie, fourth largest of 15 depository institutions in the market. Warren, and Washington Counties, all in New York. The HHI would increase 11 points to 1507. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 699 ORDERS ISSUED OR ACTIONS TAKEN BY THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM (APRIL 1, 1999-JUNE 30, 1999) Bulletin Volume Applicant Merged or Acquired Bank or Activity Date of Approval and Page ANB Corporation, Farmers State Bancorp, April 1, 1999 85, 439 Muncie, Indiana Union City, Ohio The Farmers State Bank of Union City, Union City, Ohio Anglo Irish Bank Corporation pic, To establish a representative office in June 28, 1999 85, 587 Dublin, Ireland Boston, Massachusetts Banco BA-Creditanstalt S.A., To establish a representative office in May 17, 1999 85, 518 Sao Paulo, Brazil New York, New York Banco de Credito e' Inversiones S.A., To establish an agency in Miami, Florida April 12, 1999 85, 446 Santiago, Chile Banco Santander, S.A., BCH-USA, April 1, 1999 85, 441 Madrid, Spain New York, New York Banco Central Hispano-americano, S.A., Madrid, Spain BankBoston Corporation, The Chase Manhattan Corporation, June 30, 1999 85, 582 Boston, Massachusetts New York, New York The Bank of New York Company, Inc., Citizens Financial Group, Inc., New York, New York Providence, Rhode Island Comerica Incorporated, Detroit, Michigan First Union Corporation, Charlotte, North Carolina Fleet Financial Group, Inc., Boston, Massachusetts HSBC Holdings PLC, London, England HSBC Holdings BV, Amsterdam, The Netherlands HSBC Americas, Inc., Buffalo, New York The Royal Bank of Scotland Group PLC, Edinburgh, Scotland The Royal Bank of Scotland PLC, Edinburgh, Scotland Summit Bancorp, Princeton, New Jersey Magic Line, Inc., Dearborn, Michigan NYCE Corporation, Woodcliff Lake, New Jersey BOK Financial Corporation, First Bancshares of Muskogee, Inc., May 24, 1999 85, 505 Tulsa, Oklahoma Muskogee, Oklahoma BOKF Merger Corporation Number First National Bank and Trust Company Seven, of Muskogee, Tulsa, Oklahoma Muskogee, Oklahoma First of Muskogee Insurance Corporation, Muskogee, Oklahoma Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

700 Federal Reserve Bulletin • October 1999 65 Orders Issued—Continued Bulletin Volume Applicant Merged or Acquired Bank or Activity Date of Approval and Page Chittenden Corporation, Vermont Financial Services Corp., May 12, 1999 85, 499 Burlington, Vermont Brattleboro, Vermont Vermont National Bank, Brattleboro, Vermont United Bank, Greenfield, Massachusetts Community Capital Bancshares, Inc., Albany Bank & Trust, N.A., April 12, 1999 85, 444 Albany, Georgia Albany, Georgia Deutsche Bank AG, Bankers Trust Corporation, May 20, 1999 85, 509 Frankfurt am Main, Germany New York, New York Bankers Trust Company, New York, New York Bankers Trust (Delaware), Wilmington, Delaware Bankers Trust Florida, N.A., Palm Beach, Florida Deutsche VerkehrsBank AG, To establish a representative office in June 28, 1999 85, 588 Frankfurt am Main, Germany New York, New York Ideal Bancshares, Inc., First State Bank of Goodrich, June 14, 1999 85, 577 West Fargo, North Dakota Goodrich, North Dakota ING Bank, N.V., To establish a representative office in April 19, 1999 85, 448 Amsterdam, The Netherlands New York, New York Otto Brmer Foundation, Dean Financial Services, Inc., June 16, 1999 85, 578 St. Paul, Minnesota St. Paul, Minnesota Bremer Financial Corporation, First National Bank of Aitkin, St. Paul, Minnesota Aitkin, Minnesota State Bank of Edgerton, Edgerton, Minnesota First State Banko of Eden Prairie, Eden Prairie, Minnesota Princeton Bank, St. Paul, Minnesota Paribas, To establish a representative office in April 1, 1999 85, 449 Paris, France Atlanta, Georgia Piraeus Bank S.A., Marathon Banking Corporation, June 14, 1999 85, 579 Athens, Greece Astoria, New York Marathon National Bank of New York, Astoria, New York Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 701 APPLICATIONS APPROVED UNDER BANK HOLDING COMPANY ACT By the Secretary of the Board Recent applications have been approved by the Secretary of the Board as listed below. Copies are available upon request to the Freedom of Information Office, Office of the Secretary, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Section 3 Applicant(s) Bank(s) Effective Date Zions Bancorporation, Regency Bancorp, August 19, 1999 Salt Lake City, Utah Fresno, California Regency Bank, Fresno, California Section 4 Applicant(s) Bank(s) Effective Date Old Kent Financial Corporation, Old Kent Securities Corporation, August 30, 1999 Grand Rapids, Michigan Grand Rapids, Michigan Wachovia Corporation, Barry, Evans, Josephs & Snipes, Inc., August 11, 1999 Winston-Salem, North Carolina Charlotte, North Carolina Wachovia Corporation, OFFITBANK Holdings, Inc., August 20, 1999 Winston-Salem, North Carolina New York, New York Zions Bancorporation, Regency Bancorp, August 19, 1999 Salt Lake City, Utah Fresno, California Regency Investment Advisors, Inc., Fresno, California 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 American Heartland Bancshares, American Heartland Bank and Trust, Chicago August 5, 1999 Inc., Sugar Grove, Illinois Sugar Grove, Illinois Arvest Bank Group, Inc., Delaware Bancshares, Inc., St. Louis August 5, 1999 Bentonville, Arkansas Jay, Oklahoma The Delaware County Bank, Jay, Oklahoma The Bancorp, Inc., Elcho Bancorporation, Chicago August 5, 1999 Cedarburg, Wisconsin Elcho, Wisconsin Northwoods State Bank, Elcho, Wisconsin BCB Holding Company, Bay Bank, Altanta July 22, 1999 Theodore, Alabama Theodore, Alabama BCC Bankshares, Inc., The Bank of Charlotte County, Richmond August 26, 1999 Phenix, Virginia Phenix, Virginia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

702 Federal Reserve Bulletin • October 1999 65 Section 3—Continued Applicant(s) Bank(s) Reserve Bank Effective Date Capitol Bancorp Ltd., Nevada Community Bancorp Limited, Chicago July 22, 1999 Lansing, Michigan Las Vegas, Nevada Sun Community Bancorp Limited, Desert Community Bank, Phoenix, Arizona Las Vegas, Nevada Commerce Bancshares, Inc., Waukee State Bank, Chicago August 4, 1999 Waukee, Iowa Waukee, Iowa Cornerstone Bancorp, Cornerstone National Bank, Richmond August 24, 1999 Easley, South Carolina Easley, South Carolina Fayette Bancorporation, Shell Rock Bancorporation, Chicago August 17, 1999 Marion, Iowa Shell Rock, Iowa Fidelity Company, First Postville Bancorporation, Inc., Chicago August 19, 1999 Dyersville, Iowa Postville, Iowa Citizens State Bank, Postville, Iowa First Flo Corporation, FAM Financial, Inc., Kansas City July 29, 1999 Florence, Colorado Macksville, Kansas First Mutual Bancshares, Inc., First Mutual Savings Bank, San Francisco August 12, 1999 Bellevue, Washington Bellevue, Washington Georgia Community Bancorp, Inc., Bank of Terrell, Altanta July 30, 1999 Reynolds, Georgia Dawson, Georgia Commercial State Bank, Donalsonville, Georgia Greater Bay Bancorp, Bay Commercial Services, San Francisco August 10, 1999 Palo Alto, California San Leandro, California Bay Bank of Commerce, San Leandro, California Great Northern Corporation, Great Northern Bank, Minneapolis August 25, 1999 St. Michael, Minnesota St. Michael, Minnesota Griffith Family Financial Holdings, First Fletcher Bancshares, Inc., Kansas City August 4, 1999 L.L.C., Fletcher, Oklahoma Lindsay, Oklahoma American Holding Company of Lindsay, Lindsay, Oklahoma Inwood Bancshares, Inc., Inwood Delaware, Inc., Dallas August 12, 1999 Dallas, Texas Dover, Delaware Provident Bank, Dallas, Texas Lehigh Acres First National Lehigh Acres First National Bank, Altanta August 13, 1999 Bancshares, Inc., Lehigh Acres, Florida Lehigh Acres, Florida Lewiston Bancorp, Lewiston State Bank, San Francisco August 6, 1999 Lewiston, Utah Lewiston, Utah Main Street Bancorp, Inc., Main Street Bank of New Jersey, Philadelphia August 2, 1999 Reading, Pennsylvania Lambertville, New Jersey Mercantile Bancorp, Inc., Farmers State Bancshares of Andrew St. Louis August 10, 1999 Quincy, Illinois County, Inc., Savannah, Missouri Farmers State Bank of Northern Missouri, Savannah, Missouri Milk River Banquo, Inc., Malta Banquo, Inc., Minneapolis August 25, 1999 Malta, Montana Malta, Montana Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 703 Section 3—Continued Applicant(s) Bank(s) Reserve Bank Effective Date Oak Hill Financial, Inc., Towne Bank, Cleveland August 19, 1999 Jackson Ohio Blue Ash, Ohio The Blue Ash Building and Loan Company, Blue Ash, Ohio Peoples Bancorp, Inc., Peoples Bancorp of Delaware, Inc., Dallas July 27, 1999 Lubbock, Texas Dover, Delaware Lorenzo State Bank, Lorenzo, Texas Peoples Florida Banking Peoples Bank, Altanta August 13, 1999 Corporation, Palm Harbor, Florida Palm Harbor, Florida Pilot Grove Savings Bank Employee Pilot Bancorp, Chicago July 22, 1999 Stock Ownership Plan, Pilot Grove, Iowa Pilot Grove, Iowa Pilot Grove Savings Bank Employee Pilot Bancorp, Inc., Chicago July 22, 1999 Stock Ownership Plan, Pilot Grove, Iowa Pilot Grove, Iowa Premier Bancshares, Inc., Bank Altanta, Altanta August 9, 1999 Altanta, Georgia Decatur, Georgia Pritchard Acquisition Co., Inc., Intercontinental Bank Shares Dallas August 18, 1999 San Antonio, Texas Corporation, San Antonio, Texas Prosperity Bancshares, Inc., South Texas Bancshares, Inc., Dallas August 12, 1999 Houston, Texas Beeville, Texas Rome, MHC, The Rome Savings Bank, New York August 16, 1999 Rome, New York Rome, New York Rome Bancorp, Inc., Rome, New York Jere J. Ruff Family Limited The First State Bank, Dallas August 19, 1999 Partnership II, Hallsville, Texas Longview, Texas Sky Financial Group, Inc., Mahoning National Bancorp, Cleveland August 19, 1999 Bowling Green, Ohio Youngstown, Ohio Skylake Bankshares, Inc., Kislak Financial Corporation, Altanta August 23, 1999 North Miami Beach, Florida Miami Lakes, Florida Somerset Bancorp, Inc., Somerset National Bank, Cleveland August 19, 1999 Corbin, Kentucky Somerset, Kentucky Southern Jersey Bancorp of Farmers and Merchants National Bank, New York August 9, 1999 Delaware, Inc., Bridgeton, New Jersey Bridgeton, New Jersey Hudson United Bank, Union City, New Jersey Synovus Financial Corp., Merit Holding Corporation, Altanta August 9, 1999 Columbus, Georgia Tucker, Georgia TB&C Bancshares, Inc., Mountain National Bank, Columbus, Georgia Tucker, Georgia Charter Bank & Trust Company, Marietta, Georgia Summersville Bancorporation, Inc., First National Bank, St. Louis August 10, 1999 Summersville, Missouri Summersville, Missouri Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

704 Federal Reserve Bulletin • October 1999 65 Section 3—Continued Applicant(s) Bank(s) Reserve Bank Effective Date United Community Banks, Inc. 1st Floyd Bankshares, Inc., Altanta July 22, 1999 Blairsville, Georgia Rome, Georgia 1st Floyd Bank, Rome, Georgia Western Commerce Bank Stock Western Commerce Bancshares of Dallas August 19, 1999 Bonus Plan and Trust Agreement, Carlsbad, Inc., Carlsbad, New Mexico Carlsbad, New Mexico Western Commerce Bank, Carlsbad, New Mexico Wewahitchka State Bank Employee Wewahitchka State Bank, Altanta August 18, 1999 Stock Ownership Plan, Wewahitchka, Florida Wewahitchka, Florida Section 4 Applicant(s) Nonbanking Activity/Company Reserve Bank Effective Date Bank of America Corporation, PaymentNet, Inc., Richmond July 29, 1999 Charlotte, North Carolina Pleasanton, California Bank Calumet, Mortgage Advisors, Inc., Chicago July 22, 1999 Hammond, Indiana Hammond, Indiana Banque Nationale de Paris, Charter Atlantic Corporation, San Francisco July 28, 1999 Paris, France New York, New York BB&T Corporation, First Liberty Financial Corp., Richmond July 30, 1999 Winston-Salem, North Carolina Macon, Georgia Charter One Financial, Inc., St. Paul Bancorp, Inc., Cleveland August 17, 1999 Cleveland, Ohio Cleveland, Ohio Commonwealth Bancshares, Inc., F.A.S.T., Software, L.L.C., St. Louis July 23, 1999 Shelbyville, Kentucky Louisville, Kentucky Dai-Ichi Kangyo Bank, Limited, Yasuda Bank and Trust Company San Francisco August 3, 1999 Tokyo, Japan (U.S.A.), Dai-Ichi Kangyo Fuji Trust & New York, New York Banking Co., Ltd., Tokyo, Japan Doral Financial Corporation, Doral Bank, FSB, New York August 4, 1999 San Juan, Puerto Rico New York, New York FLAG Financial Corporation, Thomaston Federal Savings Bank, Altanta August 6, 1999 LaGrange, Georgia Thomaston, Georgia FNB Financial Services Black Diamond Savings Bank, F.S.B. Richmond August 4, 1999 Corporation, Norton, Virginia Reidsville, North Carolina The Fuji Bank, Limited, Yasuda Bank and Trust Company New York August 3, 1999 Tokyo,Japan (U.S.A.), New York, New York Gold Banc Corporation, Inc., Regional Holding Company, Inc., Kansas City July 23, 1999 Leawood, Kansas Kansas City, Missouri Regional Investment Company, Kansas City, Missouri Independent Community Gilkison and Patterson Investment Richmond July 22, 1999 Bankshares, Inc., Advisors, Inc., Middleburg, Virginia Alexandria, Virginia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 705 Section 4—Continued Applicant(s) Nonbanking Activity/Company Reserve Bank Effective Date Marshall & Ilsley Corporation, Customers Forever, LLC, Chicago August 16, 1999 Milwaukee, Wisconsin Milwaukee, Wisconsin Mellon Bank Corporation, Mellon Financial Services Cleveland July 22, 1999 Pittsburgh, Pennsylvania Corporation #4, Pittsburgh, Pennsylvania National City Corporation, First Franklin Financial Companies, Cleveland August 10, 1999 Cleveland, Ohio Inc., San Jose, California National Westminster Bank Pic, Greenwich Capital Markets, Inc., New York August 12, 1999 London, England Greenwich, Connecticut Oak Hill Financial, Inc., Towne Financial Corporation, Cleveland August 19, 1999 Jackson, Ohio Blue Ash, Ohio The Blue Ash Building and Loan Company, Blue Ash, Ohio SunTrust Banks, Inc., Atlantic Financial Group, Inc., Altanta July 23, 1999 Altanta, Georgia Arlington, Texas U.S. Trust Corporation, NCT Holdings, Inc., New York August 24, 1999 New York, New York Greensboro, North Carolina North Carolina Trust Company, Greensboro, North Carolina Wells Fargo & Company, Norwest Financial Services, Inc., San Francisco August 10, 1999 San Francisco, California Des Moines, Iowa Norwest Financial, Inc., Des Moines, Iowa Realty Finance, Inc., Hilo, Hawaii Wells Fargo & Company, Just In Time Solutions, Inc., San Francisco July 21, 1999 San Franciso, California San Francisco, California Norwest Services, Inc., Minneapolis, Minnesota Westbank Corporation, New London Trust, FSB, Boston August 18, 1999 West Springfield, Massachusetts New London, New Hampshire Sections 3 and 4 Applicant(s) Nonbanking Activity/Company Reserve Bank Effective Date Wallowa Bancorp, Community Bancshares, Inc., San Francisco August 13, 1999 Joseph, Oregon Joseph, Oregon Community Bank, Joseph, Oregon Citizens Title & Escrow Service, Inc., Enterprise, Oregon Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

706 Federal Reserve Bulletin • October 1999 65 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 Citizens Bank, Bank One, Michigan, Chicago August 19, 1999 Flint, Michigan Detroit, Michigan Clear Lake Bank and Trust Liberty Bank, F.S.B., Chicago July 30, 1999 Company, Arnolds Park, Iowa Clear Lake, Iowa Effingham State Bank, State Bank of Farina, St. Louis August 6, 1999 Effingham, Illinois Farina, Illinois Fifth Third Bank, Kentucky, Inc., Fifth Third Bank of Lexington, Inc., Cleveland August 19, 1999 Louisville, Kentucky Lexington, Kentucky First American Bank, First American Bank, Chicago July 27, 1999 Carpentersville, Illinois Joliet, Illinois First American Bank, Kankakee, Illinois First Interstate Bank, Security State Bank and Trust Minneapolis July 29, 1999 Billings, Montana Company, Poison, Montana Fort Madison Bank & Trust Co., Bank of Dallas City, Chicago August 5, 1999 Fort Madison, Iowa Dallas City, Illinois Main Street Bank, Main Street Bank of New Jersey, Philadelphia August 2, 1999 Reading, Pennsylvania Lambertville, New Jersey Pullman Bank and Trust Company, Chicago City Bank and Trust Company, Chicago August 13, 1999 Chicago, Illinois Chicago, Illinois Sky Bank, Mahoning National Bank, National Cleveland August 19, 1999 Salineville, Ohio Association, Youngstown, Ohio PENDING CASES INVOLVING THE BOARD OF GOVERNORS This list of pending cases does not include suits against the Folstad v. Board of Governors, No. 1:99 CV 124 (W.D. Mich., Federal Reserve Banks in which the Board of Governors is not filed February 17, 1999). Freedom of Information Act comnamed a party. plaint. On March 23, 1999, the Board filed a motion to dismiss or for summary judgment. Nelson v. Greenspan, No. 1:99CV00215 (EGS) (D.D.C., filed Artis v. Greenspan, No. 1:99CV02073 (EGS) (D.D.C., filed January 28, 1999). Employment discrimination complaint. August 3, 1999). Employment discrimination action. On March 29, 1999, the Board filed a motion to dismiss the Sedgwick v. Board of Governors, No. Civ 99 0702 (D. Ari- action. zona, filed April 14, 1999). Action under Federal Tort Fraternal Order of Police v. Board of Governors, No. Claims Act alleging violation of bank supervision require- 1-.98CV03116 (WBBXD.D.C., filed December 22, 1998). ments. The Board filed a motion to dismiss on June 15, Declaratory judgment action challenging Board labor prac- 1999. tices. On February 26, 1999, the Board filed a motion to Hunter v. Board of Governors, No. 1:98CV02994 (TFH) dismiss the action. (D.D.C., filed December 9, 1998). Action under the Free- Independent Community Bankers of America v. Board of Govdom of Information Act and the Privacy Act. The Board ernors, No. 98-1482 (D.C. Cir., filed October 21, 1998). filed a motion to dismiss or for summary judgment on Petition for review of a Board order dated September 23, July 22, 1999. 1998, conditionally approving the applications of Travelers Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Legal Developments 707 Group, Inc., New York, New York, to become a bank and Desist against Craig J. Fahrner, a former institutionholding company by acquiring Citicorp, New York, New affiliated party of the Hinsbrook Bank and Trust, Willow- York, and its bank and nonbank subsidiaries. Oral argument brook, Illinois. is scheduled for October 1, 1999. Board of Governors v. Carrasco, No. 98 Civ. 3474 (LAK) Putnam-Greene Financial Corporation (S.D.N.Y., filed May 15, 1998). Action to freeze assets of Eatonton, Georgia individual pending administrative adjudication of civil money penalty assessment by the Board. On May 26, 1998, The Federal Reserve Board announced on August 2, 1999, the court issued a preliminary injunction restraining the the issuance of a Cease and Desist and Order against transfer or disposition of the individual's assets and appoint- Putnam-Greene Financial Corporation, Eatonton, Georgia. ing the Federal Reserve Bank of New York as receiver for those assets. Board of Governors v. Pharaon, No. 98-6101 (2d Cir., filed TERMINATION OF ENFORCEMENT ACTIONS May 4, 1998). Appeal and cross-appeal of district court The Federal Reserve Board announced on August 9, 1999, order granting in part and denying in part the Board's the termination of the following enforcement actions: motion for summary judgment seeking prejudgment interest and a statutory surcharge in connection with a civil money Farmers & Merchants Bank penalty assessed by the Board. On February 24, 1999, the Long Beach, California court granted the Board's appeal and denied the crossappeal, and remanded the matter to the district court for Written Agreement dated November 30, 1992; terminated determination of prejudgment interest due to the Board. April 29, 1999. Fenili v. Davidson, No. C-98-01568-CW (N.D. California, filed April 17, 1998). Tort and constitutional claim arising Bank of Adairsville out of return of a check. On June 5, 1998, the Board filed its Adairsville, Georgia motion to dismiss. Logan v. Greenspan, No. 1:98CV00049 (EGS) (D.D.C., filed Sections 16 and 17 of the Written Agreement dated January 9, 1998). Employment discrimination complaint. December 10, 1998; terminated May 6, 1999. Goldman v. Department of the Treasury, No. 98-9451 (11th Circuit, filed November 10, 1998). Appeal from a District Marin National Bancorp Court order dismissing an action challenging Federal Re- Las Vegas, Nevada serve notes as lawful money. Kerr v. Department of the Treasury, No. CV-S-97-01877- Written Agreement dated March 23, 1993; terminated July DWH (D. Nev., filed December 22, 1997). Challenge to 29, 1999. income taxation and Federal Reserve notes. On September 3, 1998, a motion to dismiss was filed on behalf of Hanmi Bank all federal defendants. The court dismissed the action on Los Angeles, California March 31, 1999, and on April 28, 1999, the plaintiff filed a notice of appeal. Written Agreement dated December 9, 1994; terminated Bettersworth v. Board of Governors, No. 97-CA-624 (W.D. June 22, 1999. Tex., filed August 21, 1997). Privacy Act case. On June 1, 1999, the Board filed a motion for summary judgment. Skandinaviska Enskilda Banken Skandinaviska Enskilda Banken's New York Branch Skandinaviska Enskilda Banken FINAL ENFORCEMENT ORDERS ISSUED BY THE Corporation BOARD OF GOVERNORS Cease and Desist Order dated September 17, 1997; termi- American Bank nated August 5, 1999. Wichita, Kansas The Federal Reserve Board announced on August 20, WRITTEN AGREEMENTS APPROVED BY FEDERAL 1999, the issuance of a Conest Order to Cease and Desist RESERVE BANKS against the American Bank, Wichita, Kansas, a state member bank. Belmont Bancorp Bridgeport, Ohio Craig J. Fahrner Hinsbrook Bank and Trust Willowbrook, Illinois The Federal Reserve Board announced on August 11, 1999, the execution of a Written Agreement by and be- The Federal Reserve Board announced on August 9, 1999, tween Belmont Bancorp, Bridgeport, Ohio, and the Federal the issuance of an Order of Prohibition and Order to Cease Reserve Bank of Cleveland. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

708 Federal Reserve Bulletin • October 1999 65 Community Capital Corporation Wellington State Bank Greenwood, South Carolina Wellington, Texas The Federal Reserve Board announced on August 19, The Federal Reserve Board announced on August 2, 1999, 1999, the termination of a Written Agreement by and the termination of a Written Agreement by and between among the Wellington State Bank, Wellington, Texas, the Community Capital Corporation, Greenwood, South Caro- Federal Reserve Bank of Dallas, and the Banking Commislina, and the Federal Reserve Bank of Richmond. sioner of Texas. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A1 Financial and Business Statistics A3 GUIDE TO TABULAR PRESENTATION Federal Finance—Continued All Gross public debt of U.S. Treasury— DOMESTIC FINANCIAL STATISTICS Types and ownership A28 U.S. government securities Money Stock and Bank Credit dealers—Transactions A4 Reserves, money stock, and debt measures A29 U.S. government securities dealers— A5 Reserves of depository institutions and Reserve Bank Positions and financing credit A30 Federal and federally sponsored credit A6 Reserves and borrowings—Depository agencies—Debt outstanding institutions Securities Markets and Corporate Finance Policy Instruments A31 New security issues—Tax-exempt state and local A7 Federal Reserve Bank interest rates governments and corporations A8 Reserve requirements of depository institutions A32 Open-end investment companies—Net sales A9 Federal Reserve open market transactions and assets A32 Corporate profits and their distribution Federal Reserve Banks A32 Domestic finance companies—Assets and liabilities A33 Domestic finance companies—Owned and managed A10 Condition and Federal Reserve note statements receivables All Maturity distribution of loan and security holding Real Estate Monetary and Credit Aggregates A34 Mortgage markets—New homes A12 Aggregate reserves of depository institutions A3 5 Mortgage debt outstanding and monetary base A13 Money stock and debt measures Consumer Credit A36 Total outstanding Commercial Banking Institutions— A3 6 Terms Assets and Liabilities A15 All commercial banks in the United States Flow of Funds A16 Domestically chartered commercial banks A17 Large domestically chartered commercial banks A37 Funds raised in U.S. credit markets A19 Small domestically chartered commercial banks A39 Summary of financial transactions A20 Foreign-related institutions A40 Summary of credit market debt outstanding A41 Summary of financial assets and liabilities Financial Markets All Commercial paper and bankers dollar DOMESTIC NONFINANCIAL STATISTICS acceptances outstanding All Prime rate charged by banks on short-term Selected Measures business loans A23 Interest rates—Money and capital markets A42 Nonfinancial business activity A24 Stock market—Selected statistics A42 Labor force, employment, and unemployment A43 Output, capacity, and capacity utilization A44 Industrial production—Indexes and gross value Federal Finance A46 Housing and construction A25 Federal fiscal and financing operations A47 Consumer and producer prices A26 U.S. budget receipts and outlays A48 Gross domestic product and income A27 Federal debt subject to statutory limitation A49 Personal income and saving Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

59 Federal Reserve Bulletin • October 1999 65 INTERNATIONAL STATISTICS Securities Holdings and Transactions A60 Foreign transactions in securities Summary Statistics A61 Marketable U.S. Treasury bonds and A50 U.S. international transactions notes—Foreign transactions A51 U.S. foreign trade A51 U.S. reserve assets Interest and Exchange Rates A51 Foreign official assets held at Federal Reserve A62 Foreign exchange rates Banks A52 Selected U.S. liabilities to foreign official institutions A63 GUIDE TO STATISTICAL RELEASES AND SPECIAL TABLES Reported by Banks in the United States SPECIAL TABLES A52 Liabilities to, and claims on, foreigners A53 Liabilities to foreigners A64 Pro forma balance sheet and income statements A55 Banks' own claims on foreigners for priced service operations, June 30, 1999 A56 Banks' own and domestic customers' claims on foreigners A66 INDEX TO SPECIAL TABLES A56 Banks' own claims on unaffiliated foreigners A57 Claims on foreign countries—Combined domestic offices and foreign branches Reported by Nonbanking Business Enterprises in the United States A58 Liabilities to unaffiliated foreigners A59 Claims on unaffiliated foreigners Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A3 Guide to Tabular Presentation SYMBOLS AND ABBREVIATIONS c Corrected GNMA Government National Mortgage Association e Estimated GDP Gross domestic product n.a. Not available 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 PMI Private mortgage insurance CMO Collateralized mortgage obligation PO Principal only CRA Community Reinvestment Act of 1977 REIT Real estate investment trust FFB Federal Financing Bank REMIC Real estate mortgage investment conduit FHA Federal Housing Administration RHS Rural Housing Service FHLBB Federal Home Loan Bank Board RP Repurchase agreement FHLMC Federal Home Loan Mortgage Corporation RTC Resolution Trust Corporation 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 G-10 Group of Ten GENERAL INFORMATION In many of the tables, components do not sum to totals because of include not fully guaranteed issues) as well as direct obligarounding. tions of the Treasury. Minus signs are used to indicate (1) a decrease, (2) a negative "State and local government" also includes municipalities, figure, or (3) an outflow. special districts, and other political 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

A4 Domestic Financial Statistics • October 1999 1.10 RESERVES, MONEY STOCK, AND DEBT MEASURES Percent annual rate of change, seasonally adjusted1 1998 1999 1999 MMoonneettaarryy oorr ccrreeddiitt aaggggrreeggaattee Q3 Q4 Q1 Q2 Mar.r Apr/ Ma/ June July Reserves of depository institutions2 1 Total -7.7 -1.8 -1.2 -6.6 -22.5 7.2 10.4 -40.4 -24.9 2 Required -8.9 -2.5 1.0 -5.6 -25.6 11.5 8.0 -41.7 -20.3 3 Nonborrowed -8.6 -.6 -1.3 -6.7 -21.1 4.4 11.5 -41.0 -29.5 4 Monetary base3 6.9 8.7 9.1 10.1 7.8 10.3 13.9 6.2 7.9 Concepts of money and debt4 5 Ml -2.0 5.0 2.8 3.5 10.3 7.0 -4.0 -4.0 -1.7 6 M2 6.9 11.0 7.2 5.7 2.8 8.8 4.7 4.3 5.4 7 M3 8.6 12.9r 7.6r 5.4 -1.1 8.5 4.9 5.5 4.9 8 Debt 5.8 6.3 6.01 5.9 7.2 6.6 4.4 4.6 n.a. Nontransaction components 9 In M25 9.9 13.0 8.7 6.5 .3 9.5 7.5 6.9 7.7 10 In M3 only6 13.6r 18.4r 8.7r 4.5 -11.6 7.6 5.8 9.0 3.4 Time and savings deposits Commercial banks 11 Savings, including MMDAs 15.8 17.6 11.6 9.7 .2 17.7 8.0 12.1 13.7 12 Small time7 .1 .3 -5.4 -3.6 -3.7 -3.3 -2.1 -2.7 .6 13 Large time8'9 3.5 3.8 .0r -3.9 -18.3 13.4 -3.4 -8.3 22.2 Thrift institutions 14 Savings, including MMDAs 9.0 10.1 12.8r 14.6 7.6 9.3 27.0 18.2 19.3 15 Small time7 -7.3 -6.7 -6.3 -6.7 -7.8 -4.1 -7.1 -11.7 -2.3 16 Large time8 .5 10.4 7.6 -7.1 -14.7 4.1 -14.8 -2.7 12.3 Money market mutual funds 17 Retail 19.0 28.4 20.5 10.3 3.1 12.6 9.1 7.8 1.5 18 Institution-only 26.6 41.8 17.9 14.5 -1.8 21.1 13.8 7.7 -4.6 Repurchase agreements and Eurodollars 19 Repurchase agreements10 12.5r 18.9r 14.1r -2.7 -45.7 -32.6 23.2 53.2 -.4 20 Eurodollars10 21.7 3.2 — .8r 20.1 49.4 21.1 -11.8 -3.7 -30.0 Debt components4 21 Federal -1.5 -2.0 -2.6 -3.0 -1.2 -2.4 -5.3 .1 n.a. 22 Nonfederal 8.2 8.9 8.6r 8.6 9.7 9.3 7.2 5.9 n.a. 1. Unless otherwise noted, rates of change are calculated from average amounts outstand- depository institutions, and (4) Eurodollars (overnight and term) held by U.S. residents at ing during preceding month or quarter. foreign branches of U.S. banks worldwide and at all banking offices in the United Kingdom 2. Figures incorporate adjustments for discontinuities, or "breaks," associated with and Canada. Excludes amounts held by depository institutions, the U.S. government, money regulatory changes in reserve requirements. (See also table 1.20.) market funds, and foreign banks and official institutions. Seasonally adjusted M3 is calculated 3. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally by summing large time deposits, institutional money fund balances, RP liabilities, adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally adjusted currency and Eurodollars, each seasonally adjusted separately, and adding this result to seasonally component of the money stock, plus (3) (for all quarterly reporters on the "Report of adjusted M2. Transaction Accounts, Other Deposits and Vault Cash" and for all weekly reporters whose Debt: The debt aggregate is the outstanding credit market debt of the domestic nonfinancial vault cash exceeds their required reserves) the seasonally adjusted, break-adjusted difference sectors—the federal sector (U.S. government, not including government-sponsored enterbetween current vault cash and the amount applied to satisfy current reserve requirements. prises or federally related mortgage pools) and the nonfederal sectors (state and local 4. Composition of the money stock measures and debt is as follows: governments, households and nonprofit organizations, nonfinancial corporate and nonfarm Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of noncorporate businesses, and farms). Nonfederal debt consists of mortgages, tax-exempt and depository institutions, (2) travelers checks of nonbank issuers, (3) demand deposits at all corporate bonds, consumer credit, bank loans, commercial paper, and other loans. The data, commercial banks other than those owed to depository institutions, the U.S. government, and which are derived from the Federal Reserve Board's flow of funds accounts, are breakforeign banks and official institutions, less cash items in the process of collection and Federal adjusted (that is, discontinuities in the data have been smoothed into the series) and Reserve float, and (4) other checkable deposits (OCDs), consisting of negotiable order of month-averaged (that is, the data have been derived by averaging adjacent month-end levels). withdrawal (NOW) and automatic transfer service (ATS) accounts at depository institutions, 5. Sum of (1) savings deposits (including MMDAs), (2) small time deposits, and (3) retail credit union share draft accounts, and demand deposits at thrift institutions. Seasonally money fund balances, each seasonally adjusted separately. adjusted Ml is computed by summing currency, travelers checks, demand deposits, and 6. Sum of (1) large time deposits, (2) institutional money fund balances, (3) RP liabilities OCDs, each seasonally adjusted separately. (overnight and term) issued by depository institutions, and (4) Eurodollars (overnight and M2: Ml plus (1) savings (including MMDAs), (2) small-denomination time deposits (time term) of U.S. addressees, each seasonally adjusted separately. deposits—including retail RPs—in amounts of less than $100,000), and (3) balances in retail 7. Small time deposits—including retail RPs—are those issued in amounts of less than money market mutual funds. Excludes individual retirement accounts (IRAs) and Keogh $100,000. All IRA and Keogh account balances at commercial banks and thrift institutions balances at depository institutions and money market funds. Seasonally adjusted M2 is are subtracted from small time deposits. calculated by summing savings deposits, small-denomination time deposits, and retail money 8. Large time deposits are those issued in amounts of $100,000 or more, excluding those fund balances, each seasonally adjusted separately, and adding this result to seasonally booked at international banking facilities. adjusted M1. 9. Large time deposits at commercial banks less those held by money market funds, M3: M2 plus (1) large-denomination time deposits (in amounts of $100,000 or more), (2) depository institutions, the U.S. government, and foreign banks and official institutions. balances in institutional money funds, (3) RP liabilities (overnight and term) issued by all 10. Includes both overnight and term. 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 May July June 23 June 30 July 7 July 14 July 21 SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding 518,390 522,071 525,806 519,161 526,608 525,657 527,196 523,374 U.S. government securities 2 Bought outright—System account 477,296 484,748 486,633 484,684 485,298 485,755 485,758 486,856 486,839 3 Held under repurchase agreements 3,974 2,017 1,718 1,851 44 4,259 1,213 1,355 1,607 Federal agency obligations 4 Bought outright 311 276 255 263 260 259 257 254 5 Held under repurchase agreements 3,4920 2,5140 3,4510 0 8370 3,3310 4,9960 5,0930 1,2390 6 Acceptances Loans to depository institutions 7 Adjustment credit 14 18 75 24 26 20 47 225 16 8 Seasonal credit 910 1260 2260 1110 1402 1730 1806 2050 2410 9 Extended credit 10 Float 512 281 388 695 350 -29 685 285 252 11 Other Federal Reserve assets 32,700 32,090 33,061 31,906 32,202 32,841 32,514 32,920 32,927 12 Gold stock 11,049 11,047 11,046 11,047 11,047 11,046 11,046 11,045 11,046 13 Special drawing rights certificate account 8,200 8,200 8,200 8,200 8,200 8,200 8,200 8,200 8,200 14 Treasury currency outstanding 26,816r 26,950 27,042 26,939 26,971 27,004 27,018 27,032 27,046 ABSORBING RESERVE FUNDS 15 Currency in circulation 523,518r 528,619 533,727 528,252 529,034 534,389 534,717 533,012 16 Treasury cash holdings 148 108 70 109 90 90 87 56 Deposits, other than reserve balances, with Federal Reserve Banks 17 Treasury 5,421 5,929 5,221 5,449 7,023 6,823 5,766 5,264 5,056 18 Foreign 200 214 213 247 211 223 207 235 198 19 Service-related balances and adjustments . . 6,889r 6,961 7,110 6,727 7,022 7,215 6,927 7,030 7,215 20 Other 273 232 271 245 212 202 264 276 287 21 Other Federal Reserve liabilities and capital . 17,361 17,638 17,611 17,656 17,569 17,960 17,513 17,584 17,462 22 Reserve balances with Federal Reserve Banks' 10,644r 8,566 7,872 10,022 5,308 11,310 6,763 8,281 6,379 End-of-month figures Wednesday figures May July June 30 July 7 July 14 July 21 SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding 526,186 527,785 519,623 520,437 U.S. government securities 2 Bought outright—System account 482,531 484,866 486,103 484,812 485,243 484,866 485,449 487,411 486,677 3 Held under repurchase agreements 6,004 9,100 3,195 1,430 50 9,100 1,425 3,172 415 Federal agency obligations 4 Bought outright 311 259 249 263 263 259 259 254 254 6 5 Ac H ce e p ld ta n un ce d s e r repurchase agreements 4,4970 5,1790 3,2800 1,4570 1,1070 5,1790 4,2460 6,9860 1,1700 Loans to depository institutions 7 Adjustment credit 14 56 82 7 125 56 32 2 67 8 9 E Se x a te so n n d a e l d c c r r e e d d it it 1070 1640 2660 1280 1690 1640 1910 2150 2520 10 Float 373 272 81 72 279 272 1,105 916 -1,445 11 Other Federal Reserve assets 32,350 32,968 34,529 32,051 32,386 32,968 32,832 33,182 33.045 12 Gold stock 11,048 11,046 11,048 11,047 11,046 11,046 11,046 11,045 11,047 13 Special drawing rights certificate account 8,200 8,200 8,200 8,200 8,200 8,200 8,200 8,200 8,200 14 Treasury currency outstanding 26,874r 27,004 27,074 26,939 26,971 27,004 27,018 27,032 27.046 ABSORBING RESERVE FUNDS 15 Currency in circulation 528,042r 532,026 533,441 529,021 529,001 532,026 536,236 534,603 533,517 16 Treasury cash holdings 145 90 57 90 90 92 56 53 Deposits, other than reserve balances, with Federal Reserve Banks 17 Treasury 5,056 6,720 4,984 4,709 6,885 6,720 5,707 5,491 4,566 18 Foreign 157 410 257 195 174 410 260 265 169 19 Service-related balances and adjustments .. 6,882r 7,215 7,012 6,727 7,022 7,215 6,927 7,030 7,216 20 Other 223 241 229 251 199 241 262 276 289 21 Other Federal Reserve liabilities and capital . 17,575 17,662 18,389 17,368 17,294 17,662 17,348 17,422 17,125 22 Reserve balances with Federal Reserve Banks' 14,226r 14,749 9,737 8,046 5,175 14,749 4,969 13,271 3,794 1. Amounts of cash held as reserves are shown in table 1.12, line 2. 3. Includes compensation that adjusts for the effects of inflation on the principal of 2. Includes securities loaned—fully guaranteed by U.S. government securities pledged inflation-indexed securities. with Federal Reserve Banks—and excludes securities sold and scheduled to be bought back 4. Excludes required clearing balances and adjustments to compensate for float. under matched sale-purchase transactions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A6 Domestic Nonfinancial Statistics • October 1999 1.12 RESERVES AND BORROWINGS Depository Institutions1 Millions of dollars Prorated monthly averages of biweekly averages RReesseerrvvee ccllaassssiiffiiccaattiioonn 1996 1997 1998 1999 Dec. Dec. Dec. Jan. Feb. Mar. Apr. Mayr June July 1 Reserve balances with Reserve Banks2 13,330 10,664 9,021 9,658 8,578 8,851 9,238 10,070 8,539 7,797 2 Total vault cash3 44,525 44,740 44,305 45,499 46,468 42,898 42,164r 42,459 42,632 44,059 3 Applied vault cash4 37,844 37,255 35,997 36,687 36,660 34,270 34,407 34,805 33,856 34,006 4 Surplus vault cash5 6,681 7,485 8,308 8,812 9,809 8,628 1,151" 7,654 8,776 10,053 5 Total reserves6 51,174 47,920 45,018 46,345 45,237 43,121 43,645 44,875 42,394 41,803 6 Required reserves 49,758 46,235 43,435 44,811 44,022 41,816 42,486 43,619 41,133 40,727 7 Excess reserve balances at Reserve Banks7 1,416 1,685 1,583 1,534 1,215 1,305 1,159 1,256 1,261 1,076 8 Total borrowings at Reserve Banks8 155 324 117 206 116 65 166 127 145 309 9 Seasonal borrowings 68 79 15 7 9 18 39 89 127 226 10 Extended credit9 0 0 0 0 0 0 0 0 0 0 Biweekly averages of daily figures for two week periods ending on dates indicated 1999 Apr. 7 Apr. 21 May 5 May 19 June 2r June 16 June 30 July 14 July 28 Aug. 11 1 Reserve balances with Reserve Banks2 9,213 8,409 10,547 9,878 10,096 8,546 8,309 7,526 8,041 7,926 2 Total vault cash3 42,525 42,350r 41,595r 42,563r 42,697 41,829 43,426 44,019 43,899 44,994 3 Applied vault cash4 34,147 34,422 34,586 34,749 34,962 33,492 34,062 33,788 34,198 34,128 4 Surplus vault cash5 8,378 7,928r 7,0 It/ 7,814r 7,736 8,337 9,365 10,231 9,702 10,866 i Total reserves6 43,360 42,831 45,133 44,626 45,058 42,037 42,371 41,314 42,238 42,054 6 Required reserves 41,872 41,915 43,852 43,533 43,623 40,883 41,027 40,303 41,098 40,974 7 Excess reserve balances at Reserve Banks7 1,487 916 1,281 1,093 1,434 1,154 1,343 1,011 1,140 1,080 8 Total borrowings at Reserve Banks8 130 149 223 103 117 114 180 331 266 409 9 Seasonal borrowings 24 33 59 85 106 100 158 196 249 263 10 Extended credit9 0 0 0 0 0 0 0 0 0 0 1. Data in this table also appear in the Board's H.3 (502) weekly statistical release. For 5. Total vault cash (line 2) less applied vault cash (line 3). ordering address, see inside front cover. Data are not break-adjusted or seasonally adjusted. 6. Reserve balances with Federal Reserve Banks (line 1) plus applied vault cash 2. Excludes required clearing balances and adjustments to compensate for float and (line 3). includes other off-balance-sheet "as-of' adjustments. 7. Total reserves (line 5) less required reserves (line 6). 3. Vault cash eligible to satisfy reserve requirements. It includes only vault cash held by 8. Also includes adjustment credit. those banks and thrifts that are not exempt from reserve requirements. Dates refer to the 9. Consists of borrowing at the discount window under the terms and conditions estabmaintenance periods in which the vault cash can be used to satisfy reserve requirements. lished for the extended credit program to help depository institutions deal with sustained 4. All vault cash held during the lagged computation period by "bound" institutions (that liquidity pressures. Because there is not the same need to repay such borrowing promptly as is, those whose required reserves exceed their vault cash) plus the amount of vault cash with traditional short-term adjustment credit, the money market effect of extended credit is applied during the maintenance period by "nonbound" institutions (that is, those whose vault similar to that of nonborrowed reserves. cash exceeds their required reserves) to satisfy current reserve requirements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A7 1.14 FEDERAL RESERVE BANK INTEREST RATES Percent per year Current and previous levels Adjustment credit1 Seasonal credit2 Extended credit3 FFeeddeerraall RReesseerrvvee BBaannkk 9/ O 3/ n 9 9 Effective date Previous rate 9/ O 3/ n 9 9 Effective date Previous rate 9/ O 3/ n 9 9 Effective date Previous rate Boston 4.75 8/24/99 4.50 5.25 8/26/99 5.20 5.75 8/26/99 5.70 New York 8/24/99 Philadelphia 8/24/99 Cleveland 8/24/99 Richmond 8/24/99 Atlanta 8/24/99 Chicago 8/24/99 St. Louis 8/24/99 Minneapolis 8/25/99 Kansas City 8/24/99 Dallas 8/26/99 San Francisco .... 4.75 8/24/99 4.50 5.25 8/26/99 5.20 5.75 8/26/99 5.70 Range of rates for adjustment credit in recent years4 Range (or F.R. Bank Range (or F.R. Bank Range (or level)—All of level)—All of level)—All F.R. Banks N.Y. F.R. Banks N.Y. F.R. Banks In effect Dec. 31, 1977 1982—July 20 11.5-12 11.5 1990—Dec. 19 6.5 6.5 23 11.5 11.5 1978—Jan. 9 6-6.5 6.5 Aug. 2 11-11.5 11 1991—Feb. 1 6-6.5 6 20 6.5 6.5 3 11 11 4 6 6 May 11 6.5-7 7 16 10.5 10.5 Apr. 30 5.5-6 5.5 12 7 7 27 10-10.5 10 May 2 5.5 5.5 July 3 7-7.25 7.25 30 10 10 Sept. 13 5-5.5 5 10 7.25 7.25 Oct. 12 9.5-10 9.5 1 7 5 5 Aug. 21 7.75 7.75 13 9.5 9.5 Nov. 6 4.5-5 4.5 Sept. 22 8 8 Nov. 22 9-9.5 9 7 4.5 4.5 Oct. 16 8-8.5 8.5 26 9 9 Dec. 20 3.5^.5 3.5 20 8.5 8.5 Dec. 14 8.5-9 9 24 3.5 3.5 Nov. 1 8.5-9.5 9.5 15 8.5-9 8.5 3 9.5 9.5 17 8.5 8.5 1992—July 2 3-3.5 3 7 3 3 1979—July 20 10 10 1984—Apr. 9 8.5-9 Aug. 17 10-10.5 10.5 13 9 1994—May 17 3-3.5 3.5 20 10.5 10.5 Nov. 21 8.5-9 1 8 3.5 3.5 Sept. 19 10.5-11 11 26 8.5 Aug. 16 4 21 11 11 Dec. 24 18 4 4 Oct. 8 11-12 12 Nov. 15 4-4.75 4.75 10 12 12 1985—May 20 7.5-8 7.5 17 4.75 4.75 24 7.5 7.5 1980—Feb. 15 12-13 13 1995—Feb. 1 4.75-5.25 5.25 19 13 13 1986—Mar. 7 7-7.5 7 9 5.25 5.25 May 29 12-13 13 10 7 7 30 12 12 Apr. 21 6.5-7 6.5 1996—Jan. 31 5.00-5.25 5.00 June 13 11-12 11 23 6.5 6.5 Feb. 5 5.00 5.00 16 11 11 July 11 6 6 July 2 2 9 8 10 1 -1 0 1 1 1 0 0 Aug. 2 2 1 2 5 5 .5 .5 -6 5 5 . . 5 5 1998—O O c c t t . . 1 1 6 5 4.7 4 5 . - 7 5 5 . 00 4 4 . . 7 7 5 5 Sept. 26 11 11 Nov. 17 12 12 1987—Sept. 4 5.5-6 6 1998—Nov. 17 4.50-4.75 4.50 Dec. 5 12-13 13 11 6 6 Nov. 19 4.50 4.50 8 13 13 1981—May 5 13-14 14 1988—Aug. 9 6-6.5 6.5 1999—Aug. 24 4.50-4.75 4.75 8 14 14 11 6.5 6.5 Aug. 26 4.75 4.75 Nov. 2 13-14 13 6 13 13 1989—Feb. 24 6.5-7 7 In effect Sept. 3, 1999 4.75 4.75 Dec. 4 12 12 27 7 7 1. Available on a short-term basis to help depository institutions meet temporary needs for of the Federal Reserve Bank, this time period may be shortened. Beyond this initial period, a funds that cannot be met through reasonable alternative sources. The highest rate established flexible rate somewhat above rates charged on market sources of funds is charged. The rate for loans to depository institutions may be charged on adjustment credit loans of unusual size ordinarily is reestablished on the first business day of each two-week reserve maintenance that result from a major operating problem at the borrower's facility. period, but it is never less than the discount rate applicable to adjustment credit plus 50 basis 2. Available to help relatively small depository institutions meet regular seasonal needs for points. funds that arise from a clear pattern of intrayearly movements in their deposits and loans and 4. For earlier data, see the following publications of the Board of Governors: Banking and that cannot be met through special industry lenders. The discount rate on seasonal credit takes Monetary Statistics, 1914-1941, and 1941-1970; and the Annual Statistical Digest, 1970into account rates charged by market sources of funds and ordinarily is reestablished on the 1979. first business day of each two-week reserve maintenance period; however, it is never less than In 1980 and 1981, the Federal Reserve applied a surcharge to short-term adjustment-credit the discount rate applicable to adjustment credit. borrowings by institutions with deposits of $500 million or more that had borrowed in 3. May be made available to depository institutions when similar assistance is not successive weeks or in more than four weeks in a calendar quarter. A 3 percent surcharge was reasonably available from other sources, including special industry lenders. Such credit may in effect from Mar. 17, 1980, through May 7, 1980. A surcharge of 2 percent was reimposed be provided when exceptional circumstances (including sustained deposit drains, impaired on Nov. 17, 1980; the surcharge was subsequently raised to 3 percent on Dec. 5, 1980, and to access to money market funds, or sudden deterioration in loan repayment performance) or 4 percent on May 5, 1981. The surcharge was reduced to 3 percent effective Sept. 22, 1981, practices involve only a particular institution, or to meet the needs of institutions experiencing and to 2 percent effective Oct. 12, 1981. As of Oct. 1, 1981, the formula for applying the difficulties adjusting to changing market conditions over a longer period (particularly at times surcharge was changed from a calendar quarter to a moving thirteen-week period. The of deposit disintermediation). The discount rate applicable to adjustment credit ordinarily is surcharge was eliminated on Nov. 17, 1981. charged on extended-credit loans outstanding less than thirty days; however, at the discretion Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 Domestic Nonfinancial Statistics • October 1999 1.15 RESERVE REQUIREMENTS OF DEPOSITORY INSTITUTIONS1 Type of deposit Net transaction accounts 1 $0 million-$46.5 million3 . 12/31/98 2 More than $46.5 million4 . 12/31/98 3 Nonpersonal time deposits! 12/27/90 4 Eurocurrency liabilities6. . . 12/27/90 1. Required reserves must be held in the form of deposits with Federal Reserve Banks succeeding calendar year by 80 percent of the percentage increase in the total reservable or vault cash. Nonmember institutions may maintain reserve balances with a Federal liabilities of all depository institutions, measured on an annual basis as of June 30. No Reserve Bank indirectly, on a pass-through basis, with certain approved institutions. For corresponding adjustment is made in the event of a decrease. The exemption applies only to previous reserve requirements, see earlier editions of the Annual Report or the Federal accounts that would be subject to a 3 percent reserve requirement. Effective with the reserve Reserve Bulletin. Under the Monetary Control Act of 1980, depository institutions maintenance period beginning December 31, 1998, for depository institutions that report include commercial banks, savings banks, savings and loan associations, credit unions, weekly, and with the period beginning January 14, 1999, for institutions that report quarterly, agencies and branches of foreign banks, and Edge Act corporations. the exemption was raised from $4.7 million to $4.9 million. 2. Transaction accounts include all deposits against which the account holder is permitted 4. The reserve requirement was reduced from 12 percent to 10 percent on to make withdrawals by negotiable or transferable instruments, payment orders of with- Apr. 2, 1992, for institutions that report weekly, and on Apr. 16, 1992, for institutions that drawal, or telephone or preauthorized transfers for the purpose of making payments to third report quarterly. persons or others. However, accounts subject to the rules that permit no more than six 5. For institutions that report weekly, the reserve requirement on nonpersonal time deposits preauthorized, automatic, or other transfers per month (of which no more than three may be with an original maturity of less than 1 Vi years was reduced from 3 percent to 1 Vi percent for by check, draft, debit card, or similar order payable directly to third parties) are savings the maintenance period that began Dec. 13, 1990, and to zero for the maintenance period that deposits, not transaction accounts. began Dec. 27, 1990. For institutions that report quarterly, the reserve requirement on 3. The Monetary Control Act of 1980 requires that the amount of transaction accounts nonpersonal time deposits with an original maturity of less than 1 ]/i years was reduced from 3 against which the 3 percent reserve requirement applies be modified annually by 80 percent of percent to zero on Jan. 17, 1991. the percentage change in transaction accounts held by all depository institutions, determined The reserve requirement on nonpersonal time deposits with an original maturity of 1 l/l as of June 30 of each year. Effective with the reserve maintenance period beginning years or more has been zero since Oct. 6, 1983. December 31, 1998, for depository institutions that report weekly, and with the period 6. The reserve requirement on Eurocurrency liabilities was reduced from 3 percent to zero beginning January 14, 1999, for institutions that report quarterly, the amount was decreased in the same manner and on the same dates as the reserve requirement on nonpersonal time from $47.8 million to $46.5 million. deposits with an original maturity of less than 1 Vi2 years (see note 5). Under the Garn-St Germain Depository Institutions Act of 1982, the Board adjusts the amount of reservable liabilities subject to a zero percent reserve requirement each year for the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A9 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS1 Millions of dollars 1998 1999 TTyyppee ooff ttrraannssaaccttiioonn 11999966 11999977 11999988 aanndd mmaattuurriittyy Dec. Jan. Feb. Mar. Apr. May June U.S. TREASURY SECURITIES2 Outright transactions (excluding matched transactions) Treasury bills 1 Gross purchases 9,901 9,147 3,550 0 0 0 0 0 0 00 2 Gross sales 0 0 0 0 0 0 0 0 0 0 3 Exchanges 426,928 436,257 450,835 41,393 35,069 36,862 35,065 48,142 37,107 35,045 4 For new bills 426,928 435,907 450,835 41,393 35,069 36,862 35,065 48,142 37,107 35,045 5 Redemptions 0 0 2,000 0 0 0 0 0 0 0 Others within one year 6 Gross purchases 524 5,549 6,297 0 0 2,103 1,060 1,677 1,421 880 7 Gross sales 0 0 0 0 0 0 0 0 0 0 8 Maturity shifts 30,512 41,716 46,062 2,539 2,865 5,578 3,015 3,768 3,768 2,740 9 Exchanges -41,394 -27,499 -49,434 -2,555 -400 -7,458 -5,956 -3,370 -4,607 -5,540 10 Redemptions 2,015 1,996 2,676 0 492 0 0 726 0 0 One to five years 11 Gross purchases 3,898 19,580r 12,901 0 0 2,752 2,428 3,362 4,442 948 12 Gross sales 0 0 0 0 0 0 0 0 0 0 13 Maturity shifts -25,022 -37,987 -37,777 -2,539 -2,865 -4,928 -3,015 -3,768 -3,768 -2,740 14 Exchanges 31,459 20,274 37,154 2,555 0 4,778 5,956 3,020 2,562 5,540 Five to ten years 15 Gross purchases 1,116 3,449r l,877r 0 0 335 346 945 1,281 65 16 Gross sales 0 0 0 0 0 0 0 0 0 0 17 Maturity shifts -5,469 -1,954 -5,908 0 0 -650 0 0 0 0 18 Exchanges 6,666 5,215 7,439 0 400 1,340 0 0 2,045 0 More than ten years 19 Gross purchases 1,655 5,897 4,864r 0 615 0 2,404 262 2,890 0 20 Gross sales 0 0 0 0 0 0 0 0 0 0 21 Maturity shifts -20 -1,775 -2,377 0 0 0 0 0 0 0 22 Exchanges 3,270 2,360 4,842 0 0 1,340 0 350 0 0 All maturities 23 Gross purchases 17,094 43,622r 29,489r 0 615 5,190 6,238 6,246 10,034 1,893 24 Gross sales 0 0 0 0 0 0 0 0 0 0 25 Redemptions 2,015 1,996 4,676 0 492 0 0 726 0 0 Matched transactions 26 Gross purchases 3,092,399 3,577,954 4,395,430 418,538 365,779 324,078 393,267 366,838 356,960 380,872 27 Gross sales 3,094,769 3,580,274 4,399,330 420,397 363,604 322,669 394,865 364,476 358,362 380,464 Repurchase agreements 28 Gross purchases 457,568 810,485 512,671 49,296 21,968 26,098 62,878 45,067 27,605 1177,,771100 29 Gross sales 450,359 809,268 514,186 38,592 37,157 27,025 53,706 48,867 30,531 14,614 30 Net change in U.S. Treasury securities 19,919 40,522r 19,398r 8,845 -12,891 5,672 13,812 4,082 5,705 5,397 FEDERAL AGENCY OBLIGATIONS Outright transactions 31 Gross purchases 0 0 0 0 0 0 0 00 00 00 32 Gross sales 0 0 25 0 0 0 0 0 0 0 33 Redemptions 409 1,540 322 30 2 0 25 0 0 52 Repurchase agreements 34 Gross purchases 75,354 160,409 284,316 48,815 23,577 37,416 35,731 20,623 38,167 3322,,778866 35 Gross sales 74,842 159,369 276,266 44,285 31,744 36,067 34,009 22,937 36,962 32,104 36 Net change in federal agency obligations 103 -500 7,703 4,500 -8,169 1,349 1,697 -2,314 1,205 630 37 Total net change in System Open Market Account... 20,021 40,022r 27,101r 13,345 -21,060 7,021 15,509 1,768 6,910 6,028 1. Sales, redemptions, and negative figures reduce holdings of the System Open Market 2. Transactions exclude changes in compensation for the effects of inflation on the principal Account; all other figures increase such holdings. of inflation-indexed securities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 Domestic Nonfinancial Statistics • October 1999 1.18 FEDERAL RESERVE BANKS Condition and Federal Reserve Note Statements1 Millions of dollars Wednesday End of month Account 1999 1999 June 30 July 7 July 14 July 21 July 28 May 31 June 30 July 31 Consolidated condition statement ASSETS 1 Gold certificate account 11,046 11,046 11,045 11,047 11,047 11,048 11,046 11,048 2 Special drawing rights certificate account 8,200 8,200 8,200 8,200 8,200 8,200 8,200 8,200 3 Coin 311 293 290 289 300 372 311 322 Loans 4 To depository institutions 220 222 217 319 276 121 220 348 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 259 259 254 254 249 311 259 249 8 Held under repurchase agreements 5,179 4,246 6,986 1,170 4,135 4,497 5,179 3,280 9 Total U.S. Treasury securities 493,966 486,874 490,583 487,092 489,944 488,535 493,966 489,298 10 Bought outright2 484,866 485,449 487,411 486,677 487,589 482,531 484,866 486,103 11 Bills 198,127 198,709 199,720 199,022 199,934 197,719 198,127 198,447 12 Notes 208,855 208,856 209,807 209,771 209,771 207,108 208,855 209,771 13 Bonds 77,884 77,884 77,884 77,884 77,884 77,704 77,884 77,884 14 Held under repurchase agreements 9,100 1,425 3,172 415 2,355 6,004 9,100 3,195 15 Total loans and securities 499,624 491,601 498,040 488,836 494,605 493,463 499,624 493,175 16 Items in process of collection 7,765 11,314 7,907 7,035 6,692 5,658 7,765 5,087 17 Bank premises 1,321 1,321 1,322 1,322 1,329 1,315 1,321 1,327 Other assets 18 Denominated in foreign currencies3 14,799 14,802 14,806 14,810 14,814 14,860 14,799 15,498 19 All other4 16,898 16,709 17,081 17,012 17,502 16,164 16,898 17,723 20 Total assets 559,964 555,287 558,691 548,551 554,488 551,080 559,964 552,378 LIABILITIES 21 Federal Reserve notes 505,423 509,604 507,918 506,812 507,836 501,685 505,423 506,746 22 Total deposits 29,527 18,682 26,069 17,660 22,528 26,577 29,527 22,112 23 Depository institutions 22,156 12,452 20,023 12,635 16,663 21,140 22,156 16,642 24 U.S. Treasury—General account 6,720 5,707 5,491 4,566 5,311 5,056 6,720 4,984 25 Foreign—Official accounts 410 260 265 169 321 157 410 257 26 Other 241 262 276 289 232 223 241 229 27 Deferred credit items 7,352 9,654 7,282 6,954 6,686 5,243 7,352 5,131 28 Other liabilities and accrued dividends5 4,654 4,297 4,323 4,028 4,337 4,474 4,654 4,402 29 Total liabilities 546,956 542,236 545,592 535,454 541,387 537,979 546,956 538,391 CAPITAL ACCOUNTS 30 Capital paid in 6,282 6,280 6,287 6,293 6,296 6,239 6,282 6,296 31 Surplus 5,952 5,952 5,952 5,952 5,952 5,952 5,952 5,952 32 Other capital accounts 775 819 860 852 853 911 775 1,739 33 Total liabilities and capital accounts 559,964 555,287 558,691 548,551 554,488 551,080 559,964 552,378 MEMO 34 Marketable U.S. Treasury securities held in custody for foreign and international accounts n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Federal Reserve note statement 35 Federal Reserve notes outstanding (issued to Banks) 726,892 728,786 733,984 739,343 744,902 710,687 726,892 746,929 36 LESS: Held by Federal Reserve Banks 221,469 219,183 226,066 232,531 237,066 209,002 221,469 240,184 37 Federal Reserve notes, net 505,423 509,604 507,918 506,812 507,836 501,685 505,423 506,746 Collateral held against notes, net 38 Gold certificate account 11,046 11,046 11,045 11,047 11,047 11,048 11,046 11,048 39 Special drawing rights certificate account 8,200 8,200 8,200 8,200 8,200 8,200 8,200 8,200 40 Other eligible assets 0 0 0 0 0 0 0 0 41 U.S. Treasury and agency securities 486,177 490,358 488,673 487,565 488,589 482,437 486,177 487,498 42 Total collateral 505,423 509,604 507,918 506,812 507,836 501,685 505,423 506,746 1. Some of the data in this table also appear in the Board's H.4.1 (503) weekly statistical 3. Valued monthly at market exchange rates. release. For ordering address, see inside front cover. 4. Includes special investment account at the Federal Reserve Bank of Chicago in Treasury 2. Includes securities loaned—fully guaranteed by U.S. Treasury securities pledged with bills maturing within ninety days. Federal Reserve Banks—and includes compensation that adjusts for the effects of inflation on 5. Includes exchange-translation account reflecting the monthly revaluation at market the principal of inflation-indexed securities. Excludes securities sold and scheduled to be exchange rates of foreign exchange commitments. bought back under matched sale-purchase transactions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Banks All 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holding Millions of dollars Wednesday End of month TTTyyypppeee ooofff hhhooollldddiiinnnggg aaannnddd mmmaaatttuuurrriiitttyyy 1999 1999 June 30 July 7 July 14 July 21 July 28 May 31 June 30 July 31 1 Total loans 220 222 217 319 277 68 193 348 2 Within fifteen days1 149 80 64 301 245 40 159 228 3. Sixteen days to ninety days 71 142 153 18 32 28 34 120 4 Total U.S. Treasury securities2 493,966 486,874 490,583 487,092 489,944 482,503 493,966 489,298 5 Within fifteen days1 24,353 12,385 14,937 17,267 14,331 13,804 24,353 7,883 6 Sixteen days to ninety days 92,490 99,693 100,023 100,396 101,194 103,293 92,490 107,061 7 Ninety-one days to one year 142,621 140,291 141,120 134,552 139,542 142,071 142,621 139,477 8 One year to five years 122,393 122,393 122,393 122,393 122,393 115,147 122,393 122,393 9 Five years to ten years 49,487 49,488 49,488 49,861 49,861 47,546 49,487 49,861 10 More than ten years 62,623 62,623 62,623 62,623 62,623 60,642 62,623 62,623 11 Total federal agency obligations 5,438 4,505 7,240 1,424 4,384 3,603 5,438 3,529 12 Within fifteen days' 5,184 4,251 6,991 1,175 4,135 3,292 5,184 3,280 13 Sixteen days to ninety days 16 26 21 21 31 37 16 31 14 Ninety-one days to one year 68 58 58 58 48 79 68 48 15 One year to five years 20 20 20 20 20 20 20 20 16 Five years to ten years 150 150 150 150 150 150 150 150 17 More than ten years 0 0 0 0 0 0 0 0 1. Holdings under repurchase agreements are classified as maturing within fifteen days in 2. Includes compensation that adjusts for the elfects of inflation on the principal of accordance with maximum maturity of the agreements. inflation-indexed securities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A12 Domestic Financial Statistics • October 1999 1.20 AGGREGATE RESERVES OF DEPOSITORY INSTITUTIONS AND MONETARY BASE1 Billions of dollars, averages of daily figures 1998 1999 1995 1996 1997 1998 IItteemm Dec. Dec. Dec. Dec. Dec. Jan. Feb. Mar. Apr. May June July Seasonally adjusted ADJUSTED FOR CHANGES IN RESERVE REQUIREMENTS2 1 Total reserves3 56.45 50.16 46.86 44.90 44.90 45.13 44.55 43.72 43.98 44.36 42.87 41.98 2 Nonborrowed reserves4 56.20 50.01 46.54 44.79 44.79 44.92 44.44 43.65 43.81 44.23r 42.72 41.67 3 Nonborrowed reserves plus extended credit5 56.20 50.01 46.54 44.79 44.79 44.92 44.44 43.65 43.81 44.23r 42.72 41.67 4 Required reserves 55.16 48.75 45.18 43.32 43.32 43.59 43.34 42.41 42.82 43.11 41.61 40.90 5 Monetary base6 434.10 451.37 478.88 512.32 512.32 516.81 520.84 524.23 528.74 534.86r 537.63 541.16 Not seasonally adjusted 6 Total reserves7 58.02 51.45 48.01 45.12 45.12 46.34 45.25 43.14 43.67 44.91 42.43 41.85 7 Nonborrowed reserves 57.76 51.30 47.69 45.00 45.00 46.14 45.13 43.08 43.50 44.78r 42.29 41.54 8 Nonborrowed reserves plus extended credit5 57.76 51.30 47.69 45.00 45.00 46.14 45.13 43.08 43.50 44.78r 42.29 41.54 9 Required reserves8 56.73 50.04 46.33 43.54 43.54 44.81 44.03 41.84 42.51 43.65 41.17 40.77 10 Monetary base9 439.03 456.63 484.98 518.28 518.28 520.01 519.70 523.35 526.77 533.12r 535.88 540.94 NOT ADJUSTED FOR CHANGES IN RESERVE REQUIREMENTS10 11 Total reserves11 57.90 51.17 47.92 45.02 45.02 46.35 45.24 43.12 43.65 44.88 42.39 41.80 12 Nonborrowed reserves 57.64 51.02 47.60 44.90 44.90 46.14 45.12 43.06 43.48 44.75 42.25 41.49 13 Nonborrowed reserves plus extended credit5 57.64 51.02 47.60 44.90 44.90 46.14 45.12 43.06 43.48 44.75 42.25 41.49 14 Required reserves 56.61 49.76 46.24 43.44 43.44 44.81 44.02 41.82 42.49 43.62 41.13 40.73 15 Monetary base12 444.45 463.40 491.79 525.06 525.06 527.59 526.85 530.30 533.49 539.98r 542.82 548.03 16 Excess reserves13 1.29 1.42 1.69 1.58 1.58 1.53 1.22 1.31 1.16 1.26 1.26 1.08 17 Borrowings from the Federal Reserve .26 .16 .32 .12 .12 .21 .12 .07 .17 .13 .15 .31 1. Latest monthly and biweekly figures are available from the Board's H.3 (502) weekly 8. To adjust required reserves for discontinuities that are due to regulatory changes in statistical release. Historical data starting in 1959 and estimates of the effect on required reserve requirements, a multiplicative procedure is used to estimate what required reserves 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. Break- Projections Section, Division of Monetary Affairs, Board of Governors of the Federal Reserve adjusted required reserves include required reserves against transactions deposits and nonper- System, Washington, DC 20551. sonal time and savings deposits (but not reservable nondeposit liabilities). 2. Figures reflect adjustments for discontinuities, or "breaks," associated with regulatory 9. The break-adjusted monetary base equals (1) break-adjusted total reserves (line 6), plus changes in reserve requirements. (See also table 1.10.) (2) the (unadjusted) currency component of the money stock, plus (3) (for all quarterly 3. Seasonally adjusted, break-adjusted total reserves equal seasonally adjusted, break- reporters on the "Report of Transaction Accounts, Other Deposits and Vault Cash" and for all adjusted required reserves (line 4) plus excess reserves (line 16). those weekly reporters whose vault cash exceeds their required reserves) the break-adjusted 4. Seasonally adjusted, break-adjusted nonborrowed reserves equal seasonally adjusted, difference between current vault cash and the amount applied to satisfy current reserve break-adjusted total reserves (line 1) less total borrowings of depository institutions from the requirements. Federal Reserve (line 17). 10. Reflects actual reserve requirements, including those on nondeposit liabilities, with no 5. Extended credit consists of borrowing at the discount window under the terms and adjustments to eliminate the effects of discontinuities associated with regulatory changes in conditions established for the extended credit program to help depository institutions deal reserve requirements. with sustained liquidity pressures. Because there is not the same need to repay such 11. Reserve balances with Federal Reserve Banks plus vault cash used to satisfy reserve boiTowing promptly as with traditional short-term adjustment credit, the money market effect requirements. of extended credit is similar to that of nonborrowed reserves. 12. The monetary base, not break-adjusted and not seasonally adjusted, consists of (1) total 6. The seasonally adjusted, break-adjusted monetary base consists of (1) seasonally reserves (line 11), plus (2) required clearing balances and adjustments to compensate for float adjusted, break-adjusted total reserves (line 1), plus (2) the seasonally adjusted currency at Federal Reserve Banks, plus (3) the currency component of the money stock, plus (4) (for component of the money stock, plus (3) (for all quarterly reporters on the "Report of all quarterly reporters on the "Report of Transaction Accounts, Other Deposits and Vault Transaction Accounts, Other Deposits and Vault Cash" and for all those weekly reporters Cash" and for all those weekly reporters whose vault cash exceeds their required reserves) the whose vault cash exceeds their required reserves) the seasonally adjusted, break-adjusted difference between current vault cash and the amount applied to satisfy current reserve difference between current vault cash and the amount applied to satisfy current reserve requirements. Since February 1984, currency and vault cash figures have been measured over requirements. the computation periods ending on Mondays. 7. Break-adjusted total reserves equal break-adjusted required reserves (line 9) plus excess 13. Unadjusted total reserves (line 11) less unadjusted required reserves (line 14). reserves (line 16). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary and Credit Aggregates A13 1.21 MONEY STOCK AND DEBT MEASURES1 Billions of dollars, averages of daily figures 1999 1995 1996 1997 1998 IItteemm Dec. Dec. Dec. Dec. Apr.r Mayr June July Seasonally adjusted Measures2 1 Ml 1,126.7 1,081.3 1,074.9 1,093.4 1,108.4 1,104.7 1,101.0 1,099.4 2 M2 3,649.1 3,823.9 4,046.6 4,402.0 4,490.0 4,507.4 4,523.5 4,543.9 3 M3 4,618.5 4,955.6 5,403.7r 5,996.9r 6,104.1 6,129.1 6,157.4 6,182.4 4 Debt 13,697.7 14,392.8r 15,094.9r 16,026.1 16,356.6 16,416.2 16,478.9 n.a. Ml components 5 Currency3 372.3 394.1 424.5 459.2 476.5 480.9 484.1 487.3 6 Travelers checks4 8.3 8.0 7.7 7.8 7.8 7.8 8.2 8.6 7 Demand deposits5 389.4 403.0 396.5 377.5 374.0 369.4 362.9 362.5 8 Other checkable deposits6 356.7 276.2 246.2 248.8 250.1 246.5 245.9 241.0 Nontransaction components 9 In M27 2,522.4 2,742.6 2,971.8 3,308.7 3,381.7 3,402.7 3,422.4 3,444.5 10 In M3 only8 969.4 1,131.7 l,357.0r l,594.9r 1,614.0 1,621.8 1,633.9 1,638.5 Commercial banks 11 Savings deposits, including MMDAs 775.3 905.2 1,022.9 1,189.8 1,225.7 1,233.9 1,246.3 1,260.5 12 Small time deposits9 575.0 593.7 626.1 626.0 614.4 613.3 611.9 612.2 13 Large time deposits10, 11 346.6 414.8 490.2 541.0 534.4 532.9 529.2 539.0 Thrift institutions 14 Savings deposits, including MMDAs 359.8 367.1 377.3 415.2 431.4 441.1 447.8 455.0 15 Small time deposits9 356.7 353.8 343.2 325.9 319.7 317.8 314.7 314.1 16 Large time deposits10 74.5 78.4 85.9 89.1 89.1 88.0 87.8 88.7 Money market mutual funds 17 Retail 455.5 522.8 602.3 751.7 790.5 796.5 801.7 880022..77 18 Institution-only 255.9 313.3 379.9 516.2 538.4 544.6 548.1 546.0 Repurchase agreements and Eurodollars 19 Repurchase agreements12 198.7 211.3 225511..77rr 297.8r 290.0 295.6 308.7 330088..66 20 Eurodollars12 93.7 113.9 149.3r 150.7 162.2 160.6 160.1 156.1 Debt components 21 Federal debt 3,638.9 3,780.6 3,798.4 3,747.4 3,707.2 3,690.8 3,691.0 n.a. 22 Nonfederal debt 10,058.8 10,612.3r 1 l,296.5r 12,278.7 12,649.4 12,725.4 12,787.8 n.a. Not seasonally adjusted Measures2 23 Ml 1,152.4 1,104.9 1,097.4 1,115.3 1,113.7 1,096.7 1,098.3 1,098.0 24 M2 3,671.7 3,843.7 4,064.8 4,418.8 4,527.6 4,486.7 4,511.4 4,534.1 25 M3 4,638.0 4,972.5 5,419.9r 6,013.0r 6,141.1 6,114.3 6,140.9 6,153.2 26 Debt 13,699.2 14,392.9r 15,094.4r 16,026.5r 16,343.2 16,381.5 16,439.4 n.a. Ml components 27 Currency3 376.2 397.9 428.9 464.2 476.0 479.9 483.2 448877..77 28 Travelers checks4 8.5 8.3 7.9 8.0 7.9 7.9 8.1 8.3 29 Demand deposits5 407.2 419.9 412.3 392.4 374.1 363.6 361.3 362.5 30 Other checkable deposits6 360.5 278.8 248.3 250.7 255.7 245.3 245.7 239.5 Nontransaction components 31 In M27 2,519.3 2,738.9 2,967.4 3,303.6 3,413.9 3,390.1 3,413.1 3,436.2 32 In M3 only8 966.4 1,128.8 l,355.0r l,594.2r 1,613.6 1,627.6 1,629.5 1,619.1 Commercial banks 33 Savings deposits, including MMDAs 774.1 903.3 1,020.4 1,186.8 1,241.5 1,235.2 1,249.8 1,261.4 34 Small time deposits9 573.8 592.7 625.3 625.4 614.5 612.0 610.6 612.0 35 Large time deposits10' 11 345.8 413.3 487.7 537.4 535.1 538.7 534.7 538.8 Thrift institutions 36 Savings deposits, including MMDAs 359.2 366.3 376.4 414.1 437.0 441.6 449.1 455.4 37 Small time deposits9 355.9 353.2 342.8 325.6 319.8 317.2 314.0 314.0 38 Large time deposits10 74.3 78.1 85.4 88.5 89.2 89.0 88.8 88.6 Money market mutual funds 39 Retail 456.1 523.2 602.5 751.7 801.1 784.0 789.6 793.4 40 Institution-only 257.7 316.0 384.5 523.3 536.7 538.3 540.6 533.4 Repurchase agreements and Eurodollars 41 Repurchase agreements12 193.8 205.7 245. r 229900..55rr 292.7 302.1 308.6 305.9 42 Eurodollars12 94.9 115.7 152.3 154.5 159.9 159.5 156.9 152.4 Debt components 43 Federal debt 3,645.9 3,787.9 3,805.8 3,754.9 3,717.1 3,674.2 3,662.8 n.a. 44 Nonfederal debt 10,053.3 10,605.0r 1 l,288.6r 12,271.5r 12,626.1 12,707.3 12,776.6 n.a. Footnotes appear on following page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Nonfinancial Statistics • October 1999 NOTES TO TABLE 1.21 1. Latest monthly and weekly figures are available from the Board's H.6 (508) weekly prises or federally related mortgage pools) and the nonfederal sectors (state and local statistical release. Historical data starting in 1959 are available from the Money and Reserves governments, households and nonprofit organizations, nonfinancial corporate and nonfarm Projections Section, Division of Monetary Affairs, Board of Governors of the Federal Reserve noncorporate businesses, and farms). Nonfederal debt consists of mortgages, tax-exempt and System, Washington, DC 20551. corporate bonds, consumer credit, bank loans, commercial paper, and other loans. The data, 2. Composition of the money stock measures and debt is as follows: which are derived from the Federal Reserve Board's flow of funds accounts, are break- Ml: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of adjusted (that is, discontinuities in the data have been smoothed into the series) and depository institutions, (2) travelers checks of nonbank issuers, (3) demand deposits at all month-averaged (that is, the data have been derived by averaging adjacent month-end levels). commercial banks other than those owed to depository institutions, the U.S. government, and 3. Currency outside the U.S. Treasury, Federal Reserve Banks, and vaults of depository foreign banks and official institutions, less cash items in the process of collection and Federal institutions. Reserve float, and (4) other checkable deposits (OCDs), consisting of negotiable order of 4. Outstanding amount of U.S. dollar-denominated travelers checks of nonbank issuers. withdrawal (NOW) and automatic transfer service (ATS) accounts at depository institutions, Travelers checks issued by depository institutions are included in demand deposits. credit union share draft accounts, and demand deposits at thrift institutions. Seasonally 5. Demand deposits at commercial banks and foreign-related institutions other than those adjusted Ml is computed by summing currency, travelers checks, demand deposits, and owed to depository institutions, the U.S. government, and foreign banks and official institu- OCDs, each seasonally adjusted separately. tions, less cash items in the process of collection and Federal Reserve float. M2: Ml plus (1) savings deposits (including MMDAs), (2) small-denomination time 6. Consists of NOW and ATS account balances at all depository institutions, credit union deposits (time deposits—including retail RPs—in amounts of less than $100,000), and (3) share draft account balances, and demand deposits at thrift institutions. balances in retail money market mutual funds. Excludes individual retirement accounts 7. Sum of (1) savings deposits (including MMDAs), (2) small time deposits, and (3) retail (IRAs) and Keogh balances at depository institutions and money market funds. Seasonally money fund balances. adjusted M2 is calculated by summing savings deposits, small-denomination time deposits, 8. Sum of (1) large time deposits, (2) institutional money fund balances, (3) RP liabilities and retail money fund balances, each seasonally adjusted separately, and adding this result to (overnight and term) issued by depository institutions, and (4) Eurodollars (overnight and seasonally adjusted Ml. term) of U.S. addressees. M3: M2 plus (1) large-denomination time deposits (in amounts of $100,000 or more) 9. Small time deposits—including retail RPs—are those issued in amounts of less than issued by all depository institutions, (2) balances in institutional money funds, (3) RP $100,000. All IRAs and Keogh accounts at commercial banks and thrift institutions are liabilities (overnight and term) issued by all depository institutions, and (4) Eurodollars subtracted from small time deposits. (overnight and term) held by U.S. residents at foreign branches of U.S. banks worldwide and 10. Large time deposits are those issued in amounts of $100,000 or more, excluding those at all banking offices in the United Kingdom and Canada. Excludes amounts held by booked at international banking facilities. depository institutions, the U.S. government, money market funds, and foreign banks and 11. Large time deposits at commercial banks less those held by money market funds, official institutions. Seasonally adjusted M3 is calculated by summing large time deposits, depository institutions, the U.S. government, and foreign banks and official institutions. institutional money fund balances, RP liabilities, and Eurodollars, each seasonally adjusted 12. Includes both overnight and term. separately, and adding this result to seasonally adjusted M2. Debt: The debt aggregate is the outstanding credit market debt of the domestic nonfinancial sectors—the federal sector (U.S. government, not including government-sponsored enter- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions—Assets and Liabilities A15 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1 A. All commercial banks Billions of dollars Monthly averages Wednesday figures Account 1998 1999 1999 Julyr Jan.r Feb/ Mar.r Apr/ Mayr Juner July July 7 July 14 July 21 July 28 Seasonally adjusted Assets 1 Bank credit 4,285.1 4,539.5 4,525.2 4,494.4 4,499.5 4,504.8 4,538.0 4,531.5 4,528.3 4,532.2 4,531.7 4,526.6 7 Securities in bank credit 1,134.0 1,217.2 1,207.0 1,188.5 1,188.1 1,187.0 1,204.2 1,220.7 1,217.5 1,218.4 1,218.5 1,221.1 U.S. government securities 763.6 794.2 791.4 798.7 799.9 797.8 811.7 815.1 813.4 815.5 815.1 814.7 4 Other securities 370.3 423.0 415.7 389.8 388.2 389.1 392.5 405.6 4m. 1 402.8 403.4 406.4 Loans and leases in bank credit2 . . . 3,151.1 3,322.3 3,318.2 3,305.9 3,311.4 3,317.9 3,333.8 3,310.9 3,310.8 3,313.9 3,313.3 3,305.5 6 Commercial and industrial 903.2 948.7 948.8 952.5 957.1 952.1 957.8 958.7 955.5 958.9 959.3 959.9 7 Real estate 1,273.7 1,336.3 1,338.2 1,339.6 1,341.9 1,349.3 1,353.8 1,354.3 1,351.8 1,351.6 1,357.6 1,353.5 8 Revolving home equity 100.1 98.8 98.4 98.6 99.4 100.5 99.8 94.3 94.1 94.2 94.3 94.3 9 Other 1,173.6 1,237.5 1,239.8 1,241.0 1,242.4 1,248.8 1,254.0 1,260.0 1,257.7 1,257.4 1,263.3 1,259.2 in Consumer 492.6 503.3 502.8 502.1 502.7 498.3 493.3 484.7 485.3 485.5 486.1 483.4 II Security3 132.0 147.5 140.1 120.1 122.9 127.4 131.3 122.5 124.0 126.0 120.0 120.1 17, Other loans and leases 349.6 386.5 388.3 391.7 386.8 390.8 397.6 390.6 394.1 391.9 390.4 388.6 n Interbank loans 212.7 223.2 227.9 221.4 217.3 227.3 224.3 224.8 224.3 216.1 222.7 239.6 14 Cash assets4 246.4 259.1 256.4 259.0 257.7 259.6 260.8 259.4 270.6 264.2 252.7 256.6 15 Other assets5 314.7 353.5 357.1 354.9 344.2 345.1 345.3 346.1 347.2 356.0 348.1 339.3 16 Total assets6 5,001.6 5,317.2 5,308.4 5,271.1 5,260.2 5,278.0 5,309.5 5303.5 5312.1 5310.1 5,296.8 5303.6 Liabilities 17 Deposits 3,213.3 3,369.6 3,378.7 3,368.1 3,375.8 3370.4 3370.8 3386.4 3,395.1 3,393.9 3,370.2 3,383.9 18 Transaction 668.0 667.4 659.4 665.2 658.8 651.1 657.0 651.5 650.9 647.9 643.5 667.8 19 Nontransaction 2,545.3 2,702.2 2,719.3 2,702.9 2,717.0 2,719.3 2,713.8 2,734.9 2,744.2 2,746.0 2,726.8 2,716.1 70 Large time 687.0 726.4 730.5 719.4 725.3 722.2 716.9 720.8 721.9 724.5 722.7 714.2 71 Other 1,858.3 1,975.8 1,988.9 1,983.6 1,991.7 1,997.1 1,996.9 2,014.1 2,022.3 2,021.5 2,004.1 2,001.9 77 Borrowings 912.5 l.OCW.l 991.9 988.3 983.6 997.6 1,020.9 1,019.3 1,014.7 1,012.4 1,024.4 1,031.1 73 From banks in the U.S 294.0 318.3 316.4 319.1 311.8 323.4 337.0 338.3 345.0 338.3 333.5 339.1 74 From others 618.4 685.8 675.5 669.2 671.8 674.2 683.9 681.0 669.7 674.1 690.8 692.0 75 Net due to related foreign offices 195.8 213.5 217.4 217.3 210.5 204.0 216.6 216.8 231.6 214.9 215.5 203.7 26 Other liabilities 281.1 304.7 295.9 271.4 272.5 268.1 269.7 263.1 272.0 269.8 258.6 253.5 27 Total liabilities 4,60Z6 4,891.9 4,883.8 4,845.1 4,842.4 4,840.0 4,878.0 4,885.6 4,913.4 4,891.0 4,868.7 4,872.2 28 Residual (assets less liabilities)7 398.9 425.4 424.5 426.0 417.8 437.9 431.5 417.9 398.6 419.2 428.1 431.4 Not seasonally adjusted Assets 79 Bank credit 4,271.1 4,548.6 4,522.8 4,492.7 4,507.6 4,507.3 4,532.2 4,515.8 4,520.7 4,517.1 4,512.2 4,505.0 30 Securities in bank credit 1,124.6 1,219.8 1,212.5 1,195.1 1,196.8 1,192.4 1,200.9 1,209.6 1,209.3 1,207.7 1,205.3 1,208.8 31 U.S. government securities 756.7 794.5 795.6 805.1 809.8 806.0 811.2 807.2 808.8 808.3 805.9 805.0 37 Other securities 367.9 425.3 416.9 390.0 386.9 386.4 389.8 402.3 400.5 399.4 399.4 403.8 33 Loans and leases in bank credit2 .. . 3,146.5 3,328.8 3,310.3 3,297.6 3,310.9 3,314.9 3,331.2 3,306.3 3,311.4 3,309.4 3,306.9 3,296.2 34 Commercial and industrial 900.9 947.6 950.3 956.0 963.8 956.5 958.0 956.4 957.2 956.5 957.0 954.0 35 Real estate 1,274.7 1,335.3 1,332.5 1,333.0 1,338.6 1,348.7 1,354.4 1,355.3 1,352.7 1,353.9 1,357.3 1,354.4 36 Revolving home equity 99.8 98.9 98.0 97.7 98.8 100.1 99.4 94.2 93.7 94.0 94.1 94.3 37 Other 11,,117744..99 1,236.4 1,234.5 1,235.3 1,239.8 1,248.6 1,254.9 1,261.2 1,259.0 1,259.8 1,263.2 1,260.1 38 Consumer 448899..88 509.6 502.7 497.3 499.2 495.8 490.6 482.3 481.1 482.5 483.9 482.6 39 Security3 129.9 147.5 139.7 123.5 124.8 127.2 130.8 120.5 121.4 123.9 117.9 118.4 40 Other loans and leases 351.1 388.8 385.2 387.7 384.6 386.7 397.5 391.8 398.9 392.7 390.8 386.8 41 Interbank loans 206.7 226.1 227.6 224.5 222.3 223.1 221.7 218.5 227.2 210.4 213.3 225.4 47 Cash assets4 239.0 272.1 257.5 251.5 255.4 257.4 256.4 251.6 275.1 255.5 237.9 241.9 43 Other assets5 317.4 346.0 353.8 350.3 347.2 346.6 351.1 348.8 355.5 357.9 346.4 339.9 44 Total assets6 4,976.8 5,335.2 5,303.5 5,260.6 5,274.2 5,275.5 53023 5,2763 5320.1 5,282.5 5,251.2 5,253.7 Liabilities 45 Deposits 3,199.1 3,368.9 3,355.7 3,362.7 3,386.6 3,360.9 3,368.8 3,370.0 3,409.2 3,378.6 3,338.5 3,344.2 46 Transaction 659.7 682.2 654.5 658.7 666.5 642.0 652.1 640.7 665.7 636.5 620.3 640.5 47 Nontransaction 2,539.4 2,686.7 2,701.2 2,704.0 2,720.1 2,718.9 2,716.7 2,729.3 2,743.5 2,742.1 2,718.2 2,703.8 48 Large time 680.9 724.5 731.2 721.4 722.2 723.4 714.2 714.1 712.0 718.0 715.9 709.7 49 Other 1,858.5 1,962.2 1,970.0 1,982.7 1,997.9 1,995.6 2,002.5 2,015.2 2,031.5 2,024.1 2,002.3 1,994.1 50 Borrowings 906.3 1,020.2 994.5 981.6 983.5 1,005.7 1,023.7 1,009.0 1,005.9 1,003.5 1,016.3 1,019.4 51 From banks in the U.S 290.7 323.3 316.7 318.7 312.4 324.3 336.6 333.3 341.3 334.0 328.5 333.0 57 From others 615.6 696.9 677.7 663.0 671.0 681.4 687.1 675.7 664.6 669.5 687.8 686.4 53 Net due to related foreign offices .... 189.1 216.4 227.1 215.4 203.5 210.4 210.8 209.0 213.3 203.0 210.2 211.3 54 Other liabilities 280.2 305.6 298.3 272.0 272.1 267.8 269.0 262.3 270.6 268.9 257.6 253.3 55 Total liabilities 4,574.7 4,911.1 4,875.6 4,831.8 4,845.6 4,844.8 4,872.4 4,8503 4399.0 4,854.0 4,822.6 4,828.2 56 Residual (assets less liabilities)7 402.1 424.1 427.9 428.7 428.6 430.7 429.9 426.0 421.0 428.5 428.6 425.5 MEMO 57 Revaluation gains on off-balance-sheet items8 93.4 112.5 108.5 87.0 86.0 85.4 84.3 86.5 87.2 85.4 83.0 87.1 58 Revaluation losses on off-balancesheet items8 91.8 109.5 106.7 85.9 87.3 86.7 85.9 87.6 87.7 86.3 84.5 88.2 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Financial Statistics • October 1999 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1—Continued B. Domestically chartered commercial banks Billions of dollars Monthly averages Wednesday figures Account 1998 1999 1999 Julyr Jan.r Feb.r Mar.r Apr/ Mayr Juner July July 7 July 14 July 21 July 28 Seasonally adjusted Assets 1 Bank credit 3,707.2 3,954.2 3,955.1 3,940.4 3,950.5 3,965.6 4,006.1 4,012.4 4,010.1 4,011.2 4,013.1 4,010.4 2 Securities in bank credit 928.6 1,005.5 1,002.5 990.1 988.7 992.0 1,009.7 1,032.0 1,029.0 1,029.0 1,029.3 1,035.3 3 U.S. government securities 672.2 710.0 708.5 715.0 712.1 712.2 723.7 727.0 724.9 726.0 727.2 728.8 4 Other securities 256.5 295.5 294.0 275.1 276.6 279.8 286.0 305.0 304.1 302.9 302.1 306.5 5 Loans and leases in bank credit2 2,778.6 2,948.7 2,952.6 2,950.4 2,961.8 2,973.6 2,996.5 2,980.4 2,981.1 2,982.2 2,983.8 2,975.1 6 Commercial and industrial 688.9 735.3 736.8 742.3 748.7 750.9 761.4 766.4 763.1 766.9 767.5 767.7 7 Real estate 1,249.7 1,314.9 1,317.7 1,319.8 1,322.2 1,329.7 1,334.9 1,336.3 1,333.4 1,333.4 1,339.8 1,335.6 8 Revolving home equity 100.1 98.8 98.4 98.6 99.4 100.5 99.8 94.3 94.1 94.2 94.3 94.3 9 Other 1,149.7 1,216.1 1,219.3 1,221.3 1,222.7 1,229.2 1,235.1 1,242.0 1,239.3 1,239.3 1,245.5 1,241.3 10 Consumer 492.6 503.3 502.8 502.1 502.7 498.3 493.3 484.7 485.3 485.5 486.1 483.4 11 Security3 69.9 84.3 80.6 69.3 71.4 74.7 80.3 70.7 75.0 73.3 68.4 66.5 12 Other loans and leases 277.3 310.9 314.7 316.8 316.8 320.0 326.6 322.3 324.3 323.0 322.0 321.8 13 Interbank loans 191.8 193.8 196.4 195.7 191.9 200.4 199.4 196.8 197.7 192.2 195.5 205.7 14 Cash assets4 211.4 222.5 220.2 222.0 223.1 223.7 227.2 224.0 236.0 227.8 216.8 221.3 15 Other assets5 280.3 314.8 319.3 317.4 306.9 309.8 312.8 314.5 313.0 321.6 318.0 309.8 16 Total assets6 4,333.5 4,627.5 4,632.9 4,617.2 4,614.1 4,641.0 4,686.9 4,689.5 4,698.8 4,694.7 4,685.2 4,689.0 Liabilities 17 Deposits 2,915.1 3,048.6 3,056.6 3,057.7 3,064.1 3,060.6 3,065.8 3,075.9 3,084.0 3,081.2 3,057.3 3,078.7 18 Transaction 654.1 654.4 645.7 652.5 648.7 640.7 646.3 640.8 640.3 637.4 633.3 656.3 19 Nontransaction 2,261.0 2,394.2 2,410.9 2,405.1 2,415.4 2,419.9 2,419.5 2,435.1 2,443.7 2,443.8 2,424.0 2,422.4 20 Large time 404.3 420.2 423.4 422.8 425.3 424.7 424.7 423.7 423.8 425.0 422.3 423.2 21 Other 1,856.8 1,974.0 1,987.6 1,982.4 1,990.1 1,995.2 1,994.8 2,011.4 2,019.8 2,018.9 2,001.7 1,999.2 22 Borrowings 720.7 810.4 810.9 813.9 811.4 824.5 839.2 846.1 839.5 839.6 852.3 859.2 23 From banks in the U.S 268.9 296.7 298.5 295.2 290.6 302.3 311.1 314.6 318.3 314.8 310.8 317.5 24 From others 451.8 513.8 512.4 518.7 520.7 522.2 528.1 531.4 521.3 524.7 541.5 541.7 25 Net due to related foreign offices .... 88.0 111.8 117.3 117.8 115.4 118.4 145.5 145.6 162.9 147.5 145.1 127.6 26 Other liabilities 211.1 230.2 225.7 204.2 206.0 209.0 210.4 204.7 209.8 208.9 203.2 198.2 27 Total liabilities 3,935.0 4,201.1 4,210.5 4,193.5 4,196.9 4,212.5 4,260.9 4,272.3 4,296.2 4,277.2 4,257.9 4,263.7 28 Residual (assets less liabilities)7 398.5 426.4 422.3 423.7 417.1 428.6 425.9 417.3 402.6 417.5 427.2 425.3 Not seasonally adjusted Assets 29 Bank credit 3,696.2 3,959.8 3,948.9 3,937.2 3,961.5 3,973.3 4,003.4 3,999.8 4,005.0 3,999.5 3,996.6 3,992.2 30 Securities in bank credit 920.8 1,007.9 1,006.3 995.6 999.0 999.1 1,007.3 1,022.5 1,021.9 1,020.5 1,018.0 1,024.0 31 U.S. government securities 665.8 710.6 712.3 720.6 722.4 719.6 722.8 719.7 720.3 719.5 718.2 719.9 32 Other securities 255.1 297.2 294.0 275.0 276.6 279.6 284.5 302.8 301.7 301.0 299.8 304.1 33 Loans and leases in bank credit2 2,775.4 2,951.9 2,942.6 2,941.6 2,962.5 2,974.2 2,996.1 2,977.3 2,983.1 2,979.0 2,978.5 2,968.2 34 Commercial and industrial 687.4 732.3 736.4 745.5 756.8 758.0 763.3 764.8 765.7 765.2 765.6 762.9 35 Real estate 1,251.0 1,313.8 1,311.6 1,313.2 1,319.1 1,329.4 1,335.7 1,337.5 1,334.4 1,335.9 1,339.6 1,336.8 36 Revolving home equity 99.8 98.9 98.0 97.7 98.8 100.1 99.4 94.2 93.7 94.0 94.1 94.3 37 Other 1,151.2 1,214.9 1,213.6 1,215.5 1,220.3 1,229.3 1,236.3 1,243.4 1,240.7 1,241.9 1,245.5 1,242.5 38 Consumer 489.8 509.6 502.7 497.3 499.2 495.8 490.6 482.3 481.1 482.5 483.9 482.6 39 Security3 68.3 84.4 80.6 72.1 73.4 74.8 79.5 69.0 72.8 71.7 66.9 65.1 40 Other loans and leases 278.8 311.9 311.3 313.4 314.0 316.2 327.0 323.7 329.0 323.7 322.6 320.8 41 Interbank loans 185.7 196.7 196.1 198.8 196.9 196.3 196.7 190.6 200.6 186.6 186.1 191.5 42 Cash assets4 204.1 235.1 222.0 215.6 221.9 221.8 221.9 216.2 240.1 219.3 202.4 206.8 43 Other assets5 283.8 307.1 314.8 312.2 311.6 312.1 319.7 317.9 322.7 324.2 317.1 310.8 44 Total assets6 4,312.6 4,641.3 4,623.9 4,605.5 4,633.8 4,644.9 4,683.0 4,666.3 4,710.2 4,671.5 4,643.9 4,643.2 Liabilities 45 Deposits 2,903.4 3,050.5 3,034.8 3,049.1 3,075.5 3,048.8 3,063.1 3,062.0 3,102.8 3,068.3 3,028.0 3,039.4 46 Transaction 645.8 669.2 641.0 645.9 656.6 631.8 641.6 630.1 655.0 626.2 610.3 629.2 47 Nontransaction 2,257.6 2,381.3 2,393.8 2,403.1 2,418.9 2,417.0 2,421.5 2,431.9 2,447.9 2,442.1 2,417.6 2,410.2 48 Large time 399.9 421.9 425.8 422.6 423.2 423.5 421.1 418.8 418.5 420.1 417.4 418.2 49 Other 1,857.6 1,959.5 1,968.0 1,980.6 1,995.7 1,993.4 2,000.4 2,013.1 2,029.3 2,022.0 2,000.2 1,992.0 50 Borrowings 714.6 826.6 813.5 807.2 811.2 832.6 842.0 835.8 830.7 830.6 844.2 847.5 51 From banks in the U.S 265.6 301.7 298.9 294.7 291.3 303.2 310.7 309.7 314.5 310.6 305.8 311.4 52 From others 449.0 524.9 514.6 512.5 519.9 529.4 531.3 526.1 516.2 520.1 538.4 536.1 53 Net due to related foreign offices .... 84.9 112.0 123.4 117.7 114.0 126.7 141.1 140.2 148.3 137.8 142.4 134.9 54 Other liabilities 211.2 230.9 226.5 204.8 206.7 209.1 210.2 204.8 209.7 209.0 203.3 198.4 55 Total liabilities 3,914.1 4,220.0 4,198.3 4,178.8 4,207.4 4,217.3 4,256.5 4,242.9 4,291.5 4,245.7 4,217.9 4,220.2 56 Residual (assets less liabilities)7 398.6 421.3 425.6 426.8 426.4 427.6 426.6 423.4 418.7 425.8 425.9 423.0 MEMO 57 Revaluation gains on off-balance-sheet items8 51.5 66.5 64.9 46.8 48.3 50.6 51.0 53.8 54.0 52.7 51.0 54.6 58 Revaluation losses on off-balancesheet items8 51.6 67.2 65.4 46.7 49.3 52.5 53.4 55.5 54.3 53.6 53.2 57.4 59 Mortgage-backed securities9 293.0 342.8 341.6 336.9 335.4 334.3 330.3 328.6 327.7 328.4 327.6 329.3 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions—Assets and Liabilities A17 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1—Continued C. Large domestically chartered commercial banks Billions of dollars Monthly averages Wednesday figures AAAccccccooouuunnnttt 1998 1999 1999 Julyr Jan.r Feb.r Mar.r Apr/ Mayr Juner July July 7 July 14 July 21 July 28 Seasonally adjusted Assets 1 Bank credit 2,298.3 2,441.0 2,434.3 2,407.0 2,411.4 2,419.5 2,446.4 2,440.0 2,441.5 2,442.6 2,438.8 2,435.5 2 Securities in bank credit 525.8 567.5 561.5 545.1 542.1 542.0 552.3 571.2 568.1 568.6 568.8 574.4 3 U.S. government securities 362.7 379.6 377.3 380.8 377.0 375.1 381.4 381.5 379.7 380.3 381.7 383.3 4 Trading account 21.6 25.1 17.9 22.5 25.9 22.3 25.1 22.7 23.2 22.2 23.1 23.2 a Investment account 341.2 354.5 359.4 358.4 351.1 352.8 356.3 358.8 356.4 358.1 358.6 360.1 Other securities 163.0 188.0 184.2 164.3 165.1 166.8 170.9 189.7 188.4 188.2 187.1 191.1 1 Trading account 77.9 91.4 87.5 66.7 66.1 68.3 67.5 73.0 72.1 71.6 70.6 74.3 8 Investment account 85.1 96.6 96.7 97.5 99.0 98.6 103.4 116.7 116.3 116.6 116.5 116.8 9 State and local government . 22.7 24.6 24.7 24.9 24.6 24.8 25.3 25.4 25.5 25.3 25.3 25.6 10 Other 62.4 71.9 72.0 72.7 74.4 73.8 78.2 91.3 90.8 91.3 91.2 91.3 11 Loans and leases in bank credit2 . . . 1,772.6 1,873.5 1,872.8 1,861.9 1,869.2 1,877.5 1,894.1 1,868.8 1,873.5 1,874.0 1,869.9 1,861.1 12 Commercial and industrial 506.7 537.4 538.5 542.9 548.1 548.3 556.7 559.1 556.6 559.9 560.1 559.6 13 Bankers acceptances 1.2 1.3 1.2 1.1 1.1 1.0 1.0 1.0 1.0 1.0 1.0 1.0 14 Other 505.5 536.1 537.4 541.8 547.1 547.3 555.7 558.1 555.6 558.9 559.1 558.6 15 Real estate 698.6 712.7 712.0 708.4 708.0 711.4 710.8 705.6 704.9 705.0 708.0 703.5 16 Revolving home equity 71.6 70.0 69.9 70.0 70.6 71.3 70.5 64.9 64.6 64.8 64.9 64.9 17 Other 627.0 642.7 642.0 638.4 637.4 640.0 640.4 640.7 640.3 640.2 643.1 638.6 18 Consumer 296.0 305.0 304.1 301.6 300.1 297.2 292.6 284.7 286.7 285.6 284.7 283.1 19 Security3 64.2 78.4 74.8 63.5 65.8 69.5 75.2 65.5 69.7 68.3 63.4 61.4 20 Federal funds sold to and repurchase agreements with broker-dealers 45.5 61.6 57.7 46.3 47.8 51.4 55.6 46.8 51.3 49.3 45.4 41.9 21 Other 18.7 16.8 17.0 17.2 18.0 18.2 19.6 18.7 18.3 19.0 18.1 19.6 22 State and local government 11.2 11.7 11.6 11.6 11.8 11.8 11.8 11.9 12.0 12.1 11.9 11.9 23 Agricultural 10.2 10.3 10.4 10.3 10.2 9.9 9.9 9.7 9.7 9.7 9.8 9.7 24 Federal funds sold to and repurchase agreements with others 9.1 12.9 12.2 12.2 11.6 14.2 38.0 32.2 33.7 32.2 32.0 31.7 25 All other loans 80.6 96.4 96.2 95.8 95.9 96.1 79.3 78.6 79.4 80.0 78.5 78.1 26 Lease-financing receivables 95.9 108.6 113.1 115.6 117.8 119.2 119.9 121.5 120.9 121.3 121.6 121.9 27 Interbank loans 126.2 128.1 130.7 132.9 130.8 142.3 143.8 139.7 141.5 137.4 138.8 144.7 28 Federal funds sold to and repurchase agreements with commercial banks 74.0 80.9 81.0 84.1 80.2 87.1 86.2 88.7 87.5 8877..66 89.2 9933..88 29 Other 52.2 47.2 49.7 48.9 50.6 55.2 57.6 51.0 53.9 49.8 49.6 50.8 30 Cash assets4 146.3 152.7 150.7 152.3 154.5 152.3 155.4 151.1 161.3 155.5 144.9 147.8 31 Other assets5 219.7 238.5 243.1 239.9 229.2 230.3 232.1 229.6 232.3 233.5 232.4 225.4 32 Total assets6 2,752.4 2^22.0 2,920.3 2^93.5 2^87.6 2^06.0 2,9393 2$223 2^384 2^)30.8 2,916.7 2^153 Liabilities 33 Deposits 1,647.5 1,691.2 1,686.5 1,684.8 1,691.8 1,686.6 1,686.8 1,686.3 1,695.1 1,694.7 1,670.2 1,685.1 34 Transaction 373.4 367.3 358.8 362.8 365.2 356.3 358.3 353.7 357.5 353.2 346.1 360.8 35 Nontransaction 1,274.1 1,323.9 1,327.7 1,322.0 1,326.6 1,330.3 1,328.5 1,332.7 1,337.6 1,341.6 1,324.0 1,324.2 36 Large time 222.6 230.9 230.2 227.5 228.3 225.3 227.2 228.2 229.4 230.2 226.7 226.7 37 Other 1,051.5 1,093.0 1,097.5 1,094.5 1,098.3 1,105.0 1,101.3 1,104.5 1,108.2 1,111.3 1,097.4 1,097.5 38 Borrowings 560.1 628.6 625.2 622.3 621.3 629.1 639.5 636.4 632.7 631.0 641.6 646.0 39 From banks in the U.S 193.2 213.4 213.7 208.5 205.6 214.1 219.4 216.9 221.6 217.3 212.7 217.9 40 From others 366.9 415.2 411.5 413.8 415.7 415.0 420.2 419.5 411.1 413.7 428.9 428.1 41 Net due to related foreign offices 84.4 108.7 114.1 113.2 110.5 113.4 141.4 141.3 158.6 143.1 141.1 123.0 42 Other liabilities 183.3 199.3 195.2 173.4 174.5 176.7 177.3 172.3 177.9 176.4 170.4 166.0 43 Total liabiUties 2^4753 2,627.9 2,621.0 2^93.8 2^98.0 2,605.8 2,645.0 2,636.3 2,6643 2,645.2 2,623.2 2,620.0 44 Residual (assets less liabilities)7 277.1 294.1 299.3 299.7 289.6 300.1 294.3 285.9 274.1 285.6 293.5 295.2 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A18 Domestic Financial Statistics • October 1999 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1—Continued C. Large domestically chartered commercial banks—Continued Monthly averages Wednesday figures AAAccccccooouuunnnttt 1998 1999 1999 Julyr Jan.r Feb.r Mar.r Apr/ Mayr Juner July July 7 July 14 July 21 July 28 Not seasonally adjusted Assets 45 Bank credit 2,286.3 2,453.2 2,438.9 2,409.5 2,417.3 2,417.1 2,436.7 2,426.2 2,436.7 2,428.5 2,421.5 2,414.8 46 Securities in bank credit 519.4 570.6 567.5 549.1 547.5 543.7 548.1 563.4 562.8 561.3 559.6 564.7 47 U.S. government securities 357.7 380.8 382.7 384.9 383.1 378.0 378.6 375.7 376.4 374.8 374.5 375.9 48 Trading account 19.9 25.2 18.6 23.4 25.2 20.8 23.5 20.9 21.7 20.3 21.1 20.9 49 Investment account 337.8 355.6 364.2 361.4 357.9 357.2 355.1 354.7 354.8 354.5 353.5 355.0 50 Mortgage-backed securities .. 221.5 252.9 250.8 244.1 241.3 238.3 233.9 232.5 231.5 231.8 231.8 233.8 51 Other 116.3 102.7 113.4 117.3 116.5 118.9 121.2 122.2 123.2 122.7 121.7 121.2 52 One year or less 30.9 27.9 26.0 24.2 24.6 24.0 25.0 25.1 26.0 26.5 24.8 23.6 53 One to five years 53.0 38.2 47.5 52.9 53.5 55.2 56.9 58.0 58.6 57.6 58.0 58.0 54 More than five years . . . 32.4 36.6 39.9 40.2 38.4 39.7 39.3 39.0 38.7 38.6 38.9 39.7 55 Other securities 161.7 189.8 184.8 164.2 164.4 165.8 169.5 187.7 186.4 186.4 185.1 188.8 56 Trading account 77.9 91.4 87.5 66.7 66.1 68.3 67.5 73.0 72.1 71.6 70.6 74.3 57 Investment account 83.8 98.4 97.3 97.5 98.2 97.5 102.0 114.7 114.3 114.8 114.5 114.5 58 State and local government .. 22.3 24.8 24.8 24.9 24.7 24.9 25.1 24.9 24.8 24.8 24.9 25.2 59 Other 61.5 73.6 72.5 72.6 73.5 72.6 76.9 89.8 89.5 90.0 89.6 89.3 60 Loans and leases in bank credit2 . . 1,766.9 1,882.5 1,871.3 1,860.4 1,869.8 1,873.4 1,888.6 1,862.8 1,873.9 1,867.3 1,861.9 1,850.1 61 Commercial and industrial 505.3 535.1 538.5 545.6 554.1 552.7 556.7 557.6 558.3 558.0 558.6 555.7 62 Bankers acceptances 1.2 1.3 1.2 1.1 1.1 1.0 1.0 1.0 1.0 1.0 1.0 1.0 63 Other 504.1 533.8 537.3 544.4 553.1 551.8 555.7 556.7 557.4 557.0 557.6 554.7 64 Real estate 698.0 715.5 710.6 705.4 705.1 708.7 708.8 704.7 704.9 704.8 705.8 701.8 65 Revolving home equity 71.5 70.1 69.6 69.3 70.1 71.0 70.2 64.9 64.5 64.8 65.0 65.0 66 Other 385.2 395.7 388.3 382.1 379.7 381.5 382.2 383.1 384.9 382.9 382.8 380.4 67 Commercial 241.2 249.7 252.7 254.1 255.3 256.1 256.4 256.7 255.5 257.1 258.0 256.4 68 Consumer 294.2 310.4 304.5 298.9 297.6 295.0 290.7 282.9 284.2 283.3 282.9 282.1 69 Security3 62.6 78.5 74.8 66.2 67.8 69.7 74.4 63.9 67.4 66.7 61.9 60.0 70 Federal funds sold to and repurchase agreements with broker-dealers .... 44.0 62.2 58.3 48.8 49.8 51.1 54.0 45.2 48.9 47.7 44.3 40.3 71 Other 18.6 16.3 16.5 17.4 18.0 18.6 20.4 18.6 18.6 18.9 17.5 19.8 72 State and local government .... 11.2 11.7 11.6 11.6 11.6 11.7 11.7 11.9 11.9 12.0 11.8 11.8 73 Agricultural 10.5 10.2 10.0 9.9 9.9 9.9 10.0 10.0 10.0 10.0 10.0 10.0 74 Federal funds sold to and repurchase agreements with others 9.1 12.9 12.2 12.2 11.6 14.2 38.0 32.2 33.7 32.2 32.0 31.7 75 All other loans 80.5 98.0 94.7 94.1 93.9 92.5 78.1 78.5 82.4 79.3 77.9 75.7 76 Lease-financing receivables .... 95.6 110.3 114.4 116.5 118.0 119.1 120.1 121.1 121.1 121.0 120.9 121.2 77 Interbank loans 125.2 131.0 130.5 133.0 134.8 142.5 144.2 137.5 144.2 135.4 135.4 138.7 78 Federal funds sold to and repurchase agreements with commercial banks 71.7 84.5 81.6 83.8 82.9 86.2 85.3 85.1 88.5 84.1 84.0 86.9 79 Other 53.6 46.4 49.0 49.3 52.0 56.3 58.8 52.4 55.7 51.3 51.4 51.8 80 Cash assets4 140.8 162.0 151.5 147.3 153.4 150.7 151.2 145.1 162.4 149.3 134.6 137.5 81 Other assets5 222.1 233.8 239.9 236.1 233.6 232.6 237.4 231.8 237.4 235.8 232.5 226.0 82 Total assets6 2,736.2 2,942.1 2,922.4 2^87.4 2^01.0 2^04.4 2,930.8 2,902.4 2,942.5 2,910.8 2,885.8 2,879.0 Liabilities 83 Deposits 1,639.4 1,700.4 1,682.2 1,683.2 1,697.9 1,672.2 1,680.7 1,675.0 1,705.3 1,684.1 1,649.1 1,656.9 84 Transaction 369.1 377.5 355.9 357.5 369.3 349.8 354.6 346.9 365.6 345.7 331.9 344.7 85 Nontransaction 1,270.3 1,322.9 1,326.4 1,325.7 1,328.6 1,322.4 1,326.1 1,328.1 1,339.7 1,338.4 1,317.3 1,312.2 86 Large time 218.3 232.5 232.6 227.3 226.2 224.1 223.7 223.3 224.1 225.4 221.8 221.7 87 Other 1,052.0 1,090.4 1,093.7 1,098.5 1,102.4 1,098.3 1,102.4 1,104.8 1,115.6 1,112.9 1,095.5 1,090.5 88 Borrowings 554.2 644.3 630.4 621.3 623.8 636.8 641.2 626.4 624.4 622.8 633.5 633.1 89 From banks in the U.S 190.6 217.7 215.2 210.5 207.9 215.2 218.7 212.8 218.7 214.1 208.4 212.0 90 From nonbanks in the U.S 363.6 426.6 415.2 410.8 415.8 421.7 422.5 413.5 405.7 408.8 425.1 421.1 91 Net due to related foreign offices . . . 81.2 109.0 120.2 113.1 109.0 121.7 137.0 136.0 144.0 133.4 138.4 130.3 92 Other liabilities 183.3 199.3 195.2 173.4 174.5 176.7 177.3 172.3 177.9 176.4 170.4 166.0 93 Total liabilities 2,458.1 2,653.1 2,628.1 2^91.1 2,605.2 2,607.5 2,636.2 2,609.6 2,651.6 2,616.7 2,591.5 2,586-3 94 Residual (assets less liabilities)7 .... 278.1 289.0 294.4 296.3 295.8 297.0 294.6 292.8 290.8 294.2 294.3 292.7 MEMO 95 Revaluation gains on off-balancesheet items8 51.5 66.5 64.9 46.8 48.3 50.6 51.0 53.8 54.0 52.7 51.0 54.6 96 Revaluation losses on off-balancesheet items8 51.6 67.2 65.4 46.6 49.3 52.5 53.4 55.5 54.3 53.6 53.2 57.4 97 Mortgage-backed securities9 245.3 282.4 279.5 272.5 269.8 265.8 261.2 259.7 258.7 259.3 258.7 260.5 98 Pass-through securities 160.1 194.5 189.8 182.7 179.8 177.1 173.8 173.4 171.7 172.8 172.9 175.1 99 CMOs, REMICs, and other mortgage-backed securities .. 85.2 87.9 89.7 89.7 90.0 88.7 87.5 86.4 87.0 86.6 85.8 85.3 100 Net unrealized gains (losses) on available-for-sale securities'0 .. . 3.5 3.0 2.3 0.6 0.9 0.5 -1.3 -3.3 -2.9 -3.0 -3.2 -3.8 101 Offshore credit to U.S. residents" . . . 35.3 38.9 38.9 39.0 37.9 37.7 37.0 36.3 37.0 36.4 36.6 35.6 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions—Assets and Liabilities A15 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1—Continued D. Small domestically chartered commercial banks Billions of dollars Monthly averages Wednesday figures Account 1998 1999 1999 Julyr Jan.r Feb.r Mar.r Apr.r Mayr Juner July July 7 July 14 July 21 July 28 Seasonally adjusted Assets 1 Bank credit 1,408.9 1,513.2 1,520.8 1,533.4 1,539.1 1,546.1 1,559.7 1,572.4 1,568.6 1,568.6 1,574.3 1,574.9 2 Securities in bank credit 402.9 438.0 441.0 445.0 446.6 450.0 457.4 460.8 461.0 460.4 460.5 460.9 3 U.S. government securities 309.5 330.4 331.2 334.2 335.1 337.0 342.3 345.5 345.2 345.7 345.5 345.5 4 Other securities 93.4 107.5 109.8 110.8 111.5 113.0 115.0 115.3 115.7 114.7 115.0 115.3 5 Loans and leases in bank credit2 1,006.0 1,075.2 1,079.8 1,088.4 1,092.6 1,096.1 1,102.4 1,111.6 1,107.6 1,108.2 1,113.8 1,114.1 6 Commercial and industrial 182.3 197.9 198.2 199.3 200.6 202.6 204.7 207.3 206.5 207.0 207.4 208.1 7 Real estate 551.1 602.2 605.8 611.4 614.2 618.3 624.1 630.7 628.5 628.5 631.8 632.1 8 Revolving home equity 28.5 28.8 28.5 28.6 28.8 29.2 29.4 29.5 29.5 29.4 29.4 29.4 9 Other 522.6 573.4 577.3 582.9 585.4 589.2 594.7 601.3 599.0 599.1 602.3 602.6 10 Consumer 196.6 198.3 198.8 200.5 202.6 201.1 200.7 200.0 198.6 199.9 201.3 200.3 11 Security3 5.7 5.9 5.8 5.9 5.6 5.1 5.1 5.1 5.4 5.0 5.0 5.1 12 Other loans and leases 70.3 70.9 71.2 71.3 69.5 68.9 67.8 68.4 68.6 67.8 68.3 68.5 13 Interbank loans 65.6 65.7 65.6 62.7 61.1 58.1 55.6 57.1 56.3 54.8 56.7 61.1 14 Cash assets4 65.1 69.8 69.4 69.7 68.6 71.4 71.8 72.9 74.7 72.3 71.8 73.5 15 Other assets5 60.6 76.3 76.2 77.5 77.7 79.5 80.7 84.9 80.7 88.1 85.6 84.4 16 Total assets6 1,581.1 1,705.5 1,712.5 1,723.7 1,726.5 1,735.0 1,747.6 1,7673 1,760.4 1,763.9 1,7685 1,773.8 Liabilities 17 Deposits 1,267.6 1,357.4 1,370.1 1,372.9 1,372.4 1,374.0 1,379.0 1,389.6 1,388.8 1,386.5 1,387.1 1,393.7 18 Transaction 280.7 287.1 286.9 289.7 283.5 284.4 288.0 287.1 282.8 284.3 287.2 295.5 19 Nontransaction 986.9 1,070.3 1,083.2 1,083.1 1,088.8 1,089.6 1,091.0 1,102.5 1,106.1 1,102.3 1,099.9 1,098.2 20 Large time 181.6 189.3 193.2 195.3 197.0 199.4 197.5 195.5 194.4 194.7 195.6 196.5 21 Other 805.3 880.9 890.1 887.8 891.8 890.2 893.5 906.9 911.6 907.5 904.3 901.6 22 Borrowings 160.6 181.8 185.7 191.5 190.1 195.4 199.7 209.7 206.8 208.6 210.7 213.2 23 From banks in the U.S 75.7 83.3 84.8 86.6 85.1 88.2 91.7 97.7 96.6 97.6 98.2 99.6 24 From others 84.9 98.5 100.9 104.9 105.0 107.2 107.9 111.9 110.2 111.0 112.5 113.6 25 Net due to related foreign offices .... 3.7 3.0 3.2 4.5 4.9 5.0 4.1 4.3 4.2 4.4 4.0 4.6 26 Other liabilities 27.8 30.9 30.5 30.8 31.6 32.2 33.1 32.4 31.9 32.5 32.9 32.2 27 Total liabilities 1,459.6 1,573.2 1,589.5 1,599.7 1,598.9 1,606.6 1,615.9 1,635.9 1,631.8 1,632.0 1,634.7 1,643.7 28 Residual (assets less liabilities)7 121.5 132.4 123.0 124.0 127.6 128.4 131.7 131.3 128.5 131.9 133.8 130.1 Not seasonally adjusted Assets 29 Bank credit 1,409.9 1,506.6 1,510.0 1,527.6 1,544.2 1,556.2 1,566.8 1,573.7 1,568.3 1,571.0 1,575.0 1,577.5 30 Securities in bank credit 401.4 437.2 438.8 446.5 451.5 455.4 459.2 459.1 459.1 459.2 458.4 459.4 31 U.S. government securities 308.1 329.9 329.6 335.7 339.3 341.6 344.2 344.0 343.8 344.7 343.6 344.0 32 Other securities 93.3 107.4 109.2 110.8 112.2 113.8 115.0 115.1 115.3 114.5 114.8 115.3 33 Loans and leases in bank credit2 1,008.5 1,069.4 1,071.2 1,081.1 1,092.7 1,100.9 1,107.6 1,114.5 1,109.2 1,111.7 1,116.6 1,118.1 34 Commercial and industrial 182.1 197.2 197.9 200.0 202.7 205.2 206.6 207.2 207.4 207.2 206.9 207.2 35 Real estate 553.1 598.3 601.0 607.8 614.0 620.7 626.9 632.8 629.5 631.1 633.8 634.9 36 Revolving home equity 28.3 28.8 28.4 28.4 28.7 29.1 29.2 29.2 29.2 29.2 29.2 29.2 37 Other 524.8 569.5 572.5 579.4 585.3 591.6 597.7 603.6 600.3 601.9 604.7 605.7 38 Consumer 195.6 199.2 198.2 198.4 201.5 200.8 199.9 199.4 197.0 199.2 200.9 200.6 39 Security3 5.7 5.9 5.8 5.9 5.6 5.1 5.1 5.1 5.4 5.0 5.0 5.1 40 Other loans and leases 72.0 68.8 68.4 69.1 68.9 68.9 69.0 70.0 70.0 69.2 69.9 70.3 41 Interbank loans 60.5 65.8 65.5 65.8 62.0 53.8 52.6 53.0 56.4 51.1 50.6 52.8 42 Cash assets4 63.3 73.0 70.5 68.2 68.5 71.0 70.7 71.1 77.7 70.0 67.9 69.2 43 Other assets5 61.7 73.2 74.9 76.1 78.0 79.5 82.3 86.1 85.2 88.5 84.6 84.8 44 Total assets6 1,576.4 1,699.2 1,701.4 1,718.1 1,732.9 1,740.4 1,752.2 1,763.9 1,767.8 1,760.6 1,758.1 1,764-2 Liabilities 45 Deposits 1,263.9 1,350.0 1,352.6 1,365.8 1,377.6 1,376.6 1,382.4 1,387.0 1,397.5 1,384.2 1,378.8 1,382.5 46 Transaction 276.7 291.6 285.1 288.4 287.3 282.0 286.9 283.2 289.4 280.4 278.5 284.5 47 Nontransaction 987.2 1,058.4 1,067.4 1,077.4 1,090.3 1,094.6 1,095.4 1,103.8 1,108.1 1,103.8 1,100.4 1,098.0 48 Large time 181.6 189.3 193.2 195.3 197.0 199.4 197.5 195.5 194.4 194.7 195.6 196.5 49 Other 805.6 869.1 874.3 882.1 893.3 895.2 898.0 908.3 913.7 909.0 904.7 901.5 50 Borrowings 160.5 182.3 183.1 185.9 187.4 195.8 200.8 209.5 206.3 207.8 210.7 214.4 51 From banks in the U.S 75.0 84.0 83.6 84.2 83.4 88.1 92.0 96.9 95.8 96.5 97.4 99.4 52 From others 85.4 98.3 99.5 101.7 104.1 107.7 108.8 112.6 110.5 111.3 113.3 115.0 53 Net due to related foreign offices .... 3.7 3.0 3.2 4.5 4.9 5.0 4.1 4.3 4.2 4.4 4.0 4.6 54 Other liabilities 27.9 31.6 31.3 31.4 32.3 32.4 32.9 32.5 31.9 32.6 32.9 32.4 55 Total liabilities 1,455.9 1,566.9 1,570.2 1,587.7 1,6022 1,609.8 1,620.2 1,6333 1,639.9 1,629.0 1,626.4 1,633.9 56 Residual (assets less liabilities)7 120.5 132.3 131.2 130.5 130.7 130.6 131.9 130.6 127.8 131.6 131.6 130.3 MEMO 57 Mortgage-backed securities9 47.7 60.4 62.2 64.5 65.7 68.5 69.1 68.9 69.0 69.0 68.8 68.8 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 Domestic Financial Statistics • October 1999 1.26 COMMERCIAL BANKS IN THE UNITED STATES Assets and Liabilities1—Continued E. Foreign-related institutions Billions of dollars Monthly averages Wednesday figures Account 1998 1999 1999 July Jan.r Feb.r Mar.r Apr/ Mayr Juner July July 7 July 14 July 21 July 28 Seasonally adjusted Assets 1 Bank credit 577.9 585.3 570.1 553.9 549.0 539.2 531.8 519.1 518.1 521.1 518.6 516.2 2 Securities in bank credit 205.3 211.7 204.6 198.4 199.4 195.0 194.5 188.7 188.5 189.4 189.1 185.9 3 U.S. government securities 91.4 84.2 82.9 83.7 87.8 85.7 88.0 88.1 88.5 89.5 87.9 85.9 4 Other securities 113.9 127.5 121.7 114.7 111.6 109.3 106.5 100.6 100.0 99.9 101.3 100.0 5 Loans and leases in bank credit2 .. . 372.6 373.6 365.6 355.5 349.7 344.3 337.3 330.5 329.7 331.7 329.5 330.4 6 Commercial and industrial 214.3 213.4 212.0 210.2 208.4 201.2 196.4 192.3 192.4 192.0 191.8 192.2 7 Real estate 24.0 21.4 20.5 19.7 19.7 19.6 18.9 18.0 18.5 18.2 17.8 17.9 8 Security3 62.0 63.2 59.4 50.7 51.5 52.7 51.0 51.8 49.0 52.7 51.5 53.6 9 Other loans and leases 72.3 75.6 73.6 74.9 70.1 70.8 71.0 68.3 69.8 68.9 68.4 66.7 10 Interbank loans 20.9 29.4 31.5 25.7 25.5 26.8 25.0 28.0 26.6 23.8 27.2 33.8 11 Cash assets4 35.0 36.6 36.3 37.1 34.6 35.9 33.6 35.4 34.6 36.4 36.0 35.3 12 Other assets5 34.5 38.7 37.8 37.5 37.3 35.2 32.5 31.6 34.2 34.5 30.1 29.5 13 Total assets6 668.1r 689.7 675.5 653.9 646.2 636.9 622.6 613.9 6133 615.5 611.6 614.6 Liabilities 14 Deposits 298.2 321.0 322.1 310.4 311.6 309.8 305.0 310.4 311.2 312.7 312.9 305.2 15 Transaction 13.9 12.9 13.7 12.7 10.0 10.4 10.7 10.7 10.6 10.5 10.1 11.5 16 Nontransaction 284.3 308.0 308.4 297.8 301.6 299.4 294.3 299.8 300.6 302.2 302.8 293.7 17 Borrowings 191.7 193.6 181.0 174.4 172.2 173.1 181.7 173.2 175.2 172.8 172.1 171.9 18 From banks in the U.S 25.1 21.6 17.9 23.9 21.2 21.1 25.9 23.6 26.8 23.5 22.7 21.6 19 From others 166.6 172.0 163.1 150.5 151.1 152.0 155.8 149.6 148.4 149.4 149.3 150.3 20 Net due to related foreign offices 107.7 101.7 100.1 99.6 95.1 85.6 71.1 71.3 68.7 67.3 70.4 76.1 21 Other liabilities 70.0 74.5 70.2 67.2 66.5 59.1 59.3 58.4 62.2 60.9 55.3 55.3 22 Total liabilities 667.7r 690.8 6733 651.6 645.5 627.6 617.0 6133 6173 613.8 610.8 608.5 23 Residual (assets less liabilities)7 .4 -1.1 2.2 2.4 .7 9.4 5.6 .6 -4.0 1.7 .9 6.1 Not seasonally adjusted Assets 24 Bank credit 574.9 588.8 573.9 555.5 546.2 534.0 528.7 516.0 515.7 517.6 515.6 512.8 25 Securities in bank credit 203.8 212.0 206.2 199.5 197.8 193.3 193.6 187.1 187.3 187.2 187.3 184.8 26 U.S. government securities 90.9 83.9 83.2 84.5 87.4 86.4 88.4 87.5 88.5 88.7 87.8 85.1 27 Trading account 25.3 17.4 18.0 19.1 20.4 17.5 19.7 18.5 18.9 19.1 19.4 16.7 28 Investment account 65.7 66.5 65.3 65.5 67.1 68.9 68.7 69.1 69.6 69.6 68.4 68.4 29 Other securities 112.9 128.1 123.0 115.0 110.4 106.8 105.2 99.5 98.8 98.5 99.5 99.7 30 Trading account 70.7 79.0 74.7 70.3 67.3 65.6 62.6 58.1 57.4 57.6 57.9 58.0 31 Investment account 42.2 49.1 48.2 44.7 43.0 41.2 42.7 41.4 41.4 40.9 41.7 41.7 32 Loans and leases in bank credit2 . . . 371.1 376.9 367.7 356.0 348.4 340.7 335.1 329.0 328.4 330.4 328.3 328.0 33 Commercial and industrial 213.5r 215.2 213.9 210.5 206.9 198.6 194.7 191.5 191.6 191.3 191.5 191.1 34 Real estate 23.7 21.6 20.8 19.8 19.5 19.3 18.6 17.8 18.3 18.0 17.7 17.6 35 Security3 61.6 63.2 59.1 51.4 51.4 52.4 51.3 51.5 48.6 52.2 51.0 53.2 36 Other loans and leases 72.3r 76.9 73.8 74.3 70.6 70.4 70.5 68.1 69.9 69.0 68.2 66.0 37 Interbank loans 20.9 29.4 31.5 25.7 25.5 26.8 25.0 28.0 26.6 23.8 27.2 33.8 38 Cash assets4 34.9 37.0 35.5 36.0 33.5 35.6 34.5 35.3 35.0 36.2 35.5 35.1 39 Other assets5 33.7 39.0 39.0 38.1 35.6 34.5 31.4 30.9 32.9 33.7 29.3 29.1 40 Total assets6 664.1 693.9 679.7 655.1 640.4 630.7 6193 610.0 609.9 611.0 607.4 610.6 Liabilities 41 Deposits 295.7 318.4 320.8 313.7 311.1 312.1 305.7 308.0 306.3 310.3 310.5 304.8 42 Transaction 13.8 13.0 13.5 12.8 9.9 10.2 10.5 10.6 10.7 10.4 10.0 11.3 43 Nontransaction 281.9 305.4 307.4 300.9 301.2 301.9 295.2 297.4 295.6 299.9 300.6 293.6 44 Borrowings 191.7 193.6 181.0 174.4 172.2 173.1 181.7 173.2 175.2 172.8 172.1 171.9 45 From banks in the U.S 25.1 21.6 17.9 23.9 21.2 21.1 25.9 23.6 26.8 23.5 22.7 21.6 46 From others 166.6 172.0 163.1 150.5 151.1 152.0 155.8 149.6 148.4 149.4 149.3 150.3 47 Net due to related foreign offices .... 104.2 104.4 103.7 97.8 89.5 83.7 69.7 68.7 65.1 65.2 67.8 76.4 48 Other liabilities 69.0 74.7 71.8 67.2 65.4 58.6 58.8 57.5 60.9 59.9 54.3 54.9 49 Total liabilities 660.7r 691.1 6773 653.1 6382 627.6 615.9 607.4 607.5 6083 604.7 608.0 50 Residual (assets less liabilities)7 3.5 2.8 2.4 2.0 2.2 3.1 3.4 2.6 2.4 2.8 2.7 2.5 MEMO 51 Revaluation gains on olf-balance-sheet items8 41.9 46.0 43.6 40.2 37.7 34.8 33.3 32.7 33.2 32.7 32.0 32.4 52 Revaluation losses on off-balancesheet items8 40.2 42.3 41.3 39.2 38.0 34.2 32.5 32.2 33.4 32.8 31.3 30.9 Footnotes appear on p. A21. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banking Institutions—Assets and Liabilities A17 NOTES TO TABLE 1.26 NOTE. Tables 1.26, 1.27, and 1.28 have been revised to reflect changes in the Board's H.8 group that contained the acquired bank and put into past data for the group containing the statistical release, "Assets and Liabilities of Commercial Banks in the United States." Table acquiring bank. Balance sheet data for acquired banks are obtained from Call Reports, and a 1.27, "Assets and Liabilities of Large Weekly Reporting Commercial Banks," and table 1.28, ratio procedure is used to adjust past levels. "Large Weekly Reporting U.S. Branches and Agencies of Foreign Banks," are no longer 2. Excludes federal funds sold to, reverse RPs with, and loans made to commercial banks being published in the Bulletin. Instead, abbreviated balance sheets for both large and small in the United States, all of which are included in "Interbank loans." domestically chartered banks have been included in table 1.26, parts C and D. Data are both 3. Consists of reverse RPs with brokers and dealers and loans to purchase and carry merger-adjusted and break-adjusted. In addition, data from large weekly reporting U.S. securities. branches and agencies of foreign banks have been replaced by balance sheet estimates of all 4. Includes vault cash, cash items in process of collection, balances due from depository foreign-related institutions and are included in table 1.26, part E. These data are break- institutions, and balances due from Federal Reserve Banks. adjusted. 5. Excludes the due-from position with related foreign offices, which is included in "Net The not-seasonally-adjusted data for all tables now contain additional balance sheet items, due to related foreign offices." which were available as of October 2, 1996. 6. Excludes unearned income, reserves for losses on loans and leases, and reserves for 1. Covers the following types of institutions in the fifty states and the District of transfer risk. Loans are reported gross of these items. Columbia: domestically chartered commercial banks that submit a weekly report of condition 7. This balancing item is not intended as a measure of equity capital for use in capital (large domestic); other domestically chartered commercial banks (small domestic); branches adequacy analysis. On a seasonally adjusted basis this item reflects any differences in the and agencies of foreign banks, and Edge Act and agreement corporations (foreign-related seasonal patterns estimated for total assets and total liabilities. institutions). Excludes International Banking Facilities. Data are Wednesday values or pro 8. Fair value of derivative contracts (interest rate, foreign exchange rate, other commodity and rata averages of Wednesday values. Large domestic banks constitute a universe; data for equity contracts) in a gain/loss position, as determined under FASB Interpretation No. 39. small domestic banks and foreign-related institutions are estimates based on weekly samples 9. Includes mortgage-backed securities issued by U.S. government agencies, U.S. and on quarter-end condition reports. Data are adjusted for breaks caused by reclassifications government-sponsored enterprises, and private entities. of assets and liabilities. 10. Difference between fair value and historical cost for securities classified as available- The data for large and small domestic banks presented on pp. A17-19 are adjusted to for-sale under FASB Statement No. 115. Data are reported net of tax effects. Data shown are remove the estimated effects of mergers between these two groups. The adjustment for restated to include an estimate of these tax effects. mergers changes past levels to make them comparable with current levels. Estimated 11. Mainly commercial and industrial loans but also includes an unknown amount of credit quantities of balance sheet items acquired in mergers are removed from past data for the bank extended to other than nonfinancial businesses. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 Domestic Nonfinancial Statistics • October 1999 1.32 COMMERCIAL PAPER AND BANKERS DOLLAR ACCEPTANCES OUTSTANDING A. Commercial Paper Millions of dollars, seasonally adjusted, end of period Year ending December 1999 IItteemm 1994 1995 1996 1997 1998 Jan. Feb. Mar. Apr. May June 1 All issuers 595,382 674,904 775,371 966,699 1,163,303 1,178,168 1,178303 1,204,627 1,219,789 1,230,009 1,221,020 Financial companies' 2 Dealer-placed paper, total2 223,038 275,815 361,147 513,307 614,142 629,569 615,053 684,616 697,030 710,857 705,603 3 Directly placed paper, total3 207,701 210,829 229,662 252,536 322,030 314,601 320,468 276,424 276,721 268,129 272,014 4 Nonfinancial companies4 164,643 188,260 184,563 200,857 227,132 233,998 242,782 243,587 246,038 251,023 243,404 1. Institutions engaged primarily in commercial, savings, and mortgage banking; sales, 3. As reported by financial companies that place their paper directly with investors. personal, and mortgage financing; factoring, finance leasing, and other business lending; 4. Includes public utilities and firms engaged primarily in such activities as communicainsurance underwriting; and other investment activities. tions, construction, manufacturing, mining, wholesale and retail trade, transportation, and 2. Includes all financial-company paper sold by dealers in the open market. services. B. Bankers Dollar Acceptances1 Millions of dollars, not seasonally adjusted, year ending September2 Item 1995 1996 1997 1998 1 Total amount of reporting banks' acceptances in existence 29,242 25,832 25,774 14363 2 Amount of other banks' eligible acceptances held by reporting banks 1,249 709 736 523 3 Amount of own eligible acceptances held by reporting banks (included in item 1) 10,516 7,770 6,862 4,884 4 Amount of eligible acceptances representing goods stored in, or shipped between, foreign countries (included in item 1) 11,373 9,361 10,467 5,413 1. Includes eligible, dollar-denominated bankers acceptances legally payable in the United 2. Data on bankers dollar acceptances are gathered from approximately 65 institutions; States. Eligible acceptances are those that are eligible for discount by Federal Reserve Banks; includes U.S. chartered commerical banks (domestic and foreign offices), U.S. branches and that is, those acceptances that meet the criteria of Paragraph 7 of Section 13 of the Federal agencies of foreign banks, and Edge and agreement corporations. The reporting group is Reserve Act (12 U.S.C. §372). revised every year. 1.33 PRIME RATE CHARGED BY BANKS Short-Term Business Loans1 Percent per year Av r e a r t a e g e PPeerriioodd Av r e a r t a e g e 8.50 1996 8.27 1997—Jan 8.25 1998—July 8.25 1997 8.44 Feb 8.25 Aug. 1998 8.35 Mar 8.30 Sept. Apr 8.50 Oct. 1996—Jan. 8.50 May 8.50 Nov. 8.25 Feb. 8.25 June 8.50 Dec. 8.00 Mar. 8.25 July 8.50 7.75 Apr. 8.25 Aug 8.50 1999—Jan. May 8.25 Sept 8.50 Feb. 8.00 June 8.25 Oct 8.50 Mar. 8.25 July 8.25 Nov 8.50 Apr. Aug. 8.25 Dec 8.50 May Sept. 8.25 June Oct. 8.25 1998—Jan 8.50 July Nov 8.25 Feb 8.50 Aug. Dec. 8.25 Mar 8.50 Apr. 8.50 May 8.50 June 8.50 1. The prime rate is one of several base rates that banks use to price short-term business Report. Data in this table also appear in the Board's H.15 (519) weekly and G.13 (415) loans. The table shows the date on which a new rate came to be the predominant one quoted monthly statistical releases. For ordering address, see inside front cover. by a majority of the twenty-five largest banks by asset size, based on the most recent Call Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Financial Markets A23 1.35 INTEREST RATES Money and Capital Markets Percent per year; figures are averages of business day data unless otherwise noted 1999 1999, week ending IItteemm 11999966 11999977 11999988 Apr. May June July July 2 July 9 July 16 July 23 July 30 MONEY MARKET INSTRUMENTS 1 Federal funds1,2'3 5.30 5.46 5.35 4.74 4.74 4.76 4.99 4.95 5.00 4.97 4.96 5.01 2 Discount window borrowing2,4 5.02 5.00 4.92 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 Commercial paper'ib Nonfinancial 3 1-month n.a. 5.57 5.40 4.79 4.79 4.95 5.06 5.13 5.06 5.06 5.04 5.07 4 2-month n.a. 5.57 5.38 4.78 4.80 4.98 5.08 5.13 5.08 5.08 5.08 5.09 5 3-month n.a. 5.56 5.34 4.79 4.81 4.98 5.11 5.13 5.11 5.10 5.11 5.12 Financial 6 1-month n.a. 5.59 5.42 4.80 4.80 4.96 5.08 5.13 5.08 5.07 5.06 5.09 7 2-month n.a. 5.59 5.40 4.80 4.82 5.00 5.10 5.14 5.10 5.10 5.10 5.10 8 3-month n.a. 5.60 5.37 4.80 4.83 5.04 5.14 5.17 5.16 5.15 5.13 5.14 Commercial paper (historical) 3,5,7 9 1-month 5.43 5.54 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 10 3-month 5.41 5.58 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 11 6-month 5.42 5.62 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Finance paper, directly placed (historical)3,5,8 12 1-month 5.31 5.44 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 13 3-month 5.29 5.48 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 14 6-month 5.21 5.48 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Bankers acceptances3,5,9 15 3-month 5.31 5.54 5.39 4.80 4.86 5.04 5.16 5.20 5.15 5.19 5.14 5.17 16 6-month 5.31 5.57 5.30 4.80 4.89 5.14 5.42 5.35 5.38 5.40 5.43 5.46 Certificates of deposit, secondary market3,10 17 1-month 5.35 5.54 5.49 4.84 4.84 5.01 5.13 5.18 55..1133 55..1122 5.11 55..1144 18 3-month 5.39 5.62 5.47 4.88 4.92 5.13 5.24 5.28 5.23 5.23 5.22 5.27 19 6-month 5.47 5.73 5.44 4.94 5.03 5.31 5.58 5.51 5.57 5.58 5.56 5.64 20 Eurodollar deposits, 3-month311 5.38 5.61 5.45 4.87 4.90 5.09 5.21 5.23 5.19 5.20 5.24 5.20 U.S. Treasury bills Secondary market3,5 21 3-month 5.01 5.06 4.78 4.29 4.50 4.57 4.55 4.63 4.55 4.57 4.50 44..5599 27 6-month 5.08 5.18 4.83 4.37 4.56 4.82 4.58 4.85 4.61 4.52 4.49 4.61 23 1-year 5.22 5.32 4.80 4.45 4.60 4.82 4.75 4.84 4.78 4.72 4.71 4.80 Auction high3,5,12 74 3-month 5.02 5.07 4.81 4.28 4.51 4.59 4.60 4.75 4.59 4.60 4.52 4.54 25 6-month 5.09 5.18 4.85 4.36 4.55 4.81 4.62 4.96 4.59 4.54 4.49 4.52 26 1-year 5.23 5.36 4.85 4.50 4.63 4.89 4.71 n.a. n.a. n.a. 4.71 n.a. U.S. TREASURY NOTES AND BONDS Constant maturities13 27 1-year 5.52 5.63 5.05 4.69 4.85 5.10 5.03 5.11 5.06 5.01 4.98 5.07 28 2-year 5.84 5.99 5.13 4.98 5.25 5.62 5.55 5.61 5.62 5.52 5.49 5.59 29 3-year 5.99 6.10 5.14 5.03 5.33 5.70 5.62 5.68 5.70 5.57 5.55 5.65 30 5-year 6.18 6.22 5.15 5.08 5.44 5.81 5.68 5.76 5.75 5.61 5.61 5.75 31 7-year 6.34 6.33 5.28 5.28 5.64 6.05 5.94 6.01 6.01 5.87 5.87 6.03 32 10-year 6.44 6.35 5.26 5.18 5.54 5.90 5.79 5.87 5.87 5.72 5.72 5.86 33 20-year 6.83 6.69 5.72 5.82 6.08 6.36 6.28 6.34 6.33 6.20 6.23 6.34 34 30-year 6.71 6.61 5.58 5.55 5.81 6.04 5.98 6.03 6.04 5.91 5.94 6.05 Composite 35 More than 10 years (long-term) 6.80 6.67 5.69 5.77 6.04 6.31 6.22 6.29 6.28 6.15 6.18 6.29 STATE AND LOCAL NOTES AND BONDS Moody's series14 36 5.52 5.32 4.93 4.89 5.05 5.22 5.24 5.27 5.23 5.22 5.20 5.27 37 Baa 5.79 5.50 5.14 5.27 5.43 5.59 5.64 5.64 5.62 5.61 5.60 5.71 38 Bond Buyer series15 5.76 5.52 5.09 5.08 5.18 5.37 5.36 5.35 5.34 5.36 5.35 5.41 CORPORATE BONDS 39 Seasoned issues, all industries16 7.66 7.54 6.87 7.05 7.32 7.62 7.57 7.63 7.60 7.47 7.53 7.67 Rating group 40 7.37 7.27 6.53 6.64 6.93 7.23 7.19 7.24 77..2233 7.09 7.15 7.29 41 Aa 7.55 7.48 6.80 6.96 7.23 7.52 7.48 7.53 7.51 7.38 7.44 7.58 42 A 7.69 7.54 6.93 7.13 7.40 7.69 7.65 7.70 7.67 7.56 7.62 7.75 43 Baa 8.05 7.87 7.22 7.48 7.72 8.02 7.95 8.01 7.98 7.86 7.91 8.04 MEMO Dividend-price ratio17 44 Common stocks 2.19 1.77 1.49 1.24 1.24 1.25 1.20 1.21 1.19 1.19 1.21 1.22 1. The daily effective federal funds rate is a weighted average of rates on trades through 11. Bid rates for Eurodollar deposits collected around 9:30 a.m. Eastern time. Data are for New York brokers. indication purposes only. 2. Weekly figures are averages of seven calendar days ending on Wednesday of the 12. Auction date for daily data; weekly and monthly averages computed on an issue-date current week; monthly figures include each calendar day in the month. basis. On or after October 28, 1998, data are stop yields from uniform-price auctions. Before 3. Annualized using a 360-day year or bank interest. that, they are weighted average yields from multiple-price auctions. 4. Rate for the Federal Reserve Bank of New York. 13. Yields on actively traded issues adjusted to constant maturities. Source: U.S. Depart- 5. Quoted on a discount basis. ment of the Treasury. 6. Interest rates interpolated from data on certain commercial paper trades settled by the 14. General obligation bonds based on Thursday figures; Moody's Investors Service. Depository Trust Company. The trades represent sales of commercial paper by dealers or 15. State and local government general obligation bonds maturing in twenty years are used direct issuers to investors (that is, the offer side). See Board's Commercial Paper Web pages in compiling this index. The twenty-bond index has a rating roughly equivalent to Moodys' (http://www.federalreserve.gov/releases/cp) for more information. A1 rating. Based on Thursday figures. 7. An average of offering rates on commercial paper for firms whose bond rating is AA or 16. Daily figures from Moody's Investors Service. Based on yields to maturity on selected the equivalent. Series ended August 29, 1997. long-term bonds. 8. An average of offering rates on paper directly placed by finance companies. Series 17. Standard & Poor's corporate series. Common stock ratio is based on the 500 stocks in ended August 29, 1997. the price index. 9. Representative closing yields for acceptances of the highest-rated money center banks. NOTE. Some of the data in this table also appear in the Board's H.15 (519) weekly and 10. An average of dealer offering rates on nationally traded certificates of deposit. 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

A24 Domestic Nonfinancial Statistics • October 1999 1.36 STOCK MARKET Selected Statistics 1998 1999 IInnddiiccaattoorr 11999966 11999977 11999988 Nov. Dec. Jan. Feb. Mar. Apr. May June July Prices and trading volume (averages of daily figures)1 CCCCCCCooooooommmmmmmmmmmmmmooooooonnnnnnn ssssssstttttttoooooooccccccckkkkkkk ppppppprrrrrrriiiiiiiccccccceeeeeeesssssss (((((((iiiiiiinnnnnnndddddddeeeeeeexxxxxxxeeeeeeesssssss))))))) 1111111 NNNNNNNeeeeeeewwwwwww YYYYYYYooooooorrrrrrrkkkkkkk SSSSSSStttttttoooooooccccccckkkkkkk EEEEEEExxxxxxxccccccchhhhhhhaaaaaaannnnnnngggggggeeeeeee (((((((DDDDDDDeeeeeeeccccccc....... 33333331111111,,,,,,, 1111111999999966666665555555 ======= 55555550000000))))))) 357.98 456.99 550.65 564.26 576.05 595.43 588.70 603.69 627.75 635.62 629.53 648.83 2222222 IIIIIIInnnnnnnddddddduuuuuuussssssstttttttrrrrrrriiiiiiiaaaaaaalllllll 453.57 574.97 684.35 704.46 717.14 741.43 736.20 751.93 780.84 791.72 783.96 809.33 3333333 TTTTTTTrrrrrrraaaaaaannnnnnnssssssspppppppooooooorrrrrrrtttttttaaaaaaatttttttiiiiiiiooooooonnnnnnn 327.30 415.08 468.61 442.95 456.70 479.72 477.47 491.25 523.08 537.88 520.66 528.72 4444444 UUUUUUUtttttttiiiiiiillllllliiiiiiitttttttyyyyyyy 126.36 143.87 190.52 206.29 215.57 224.75 218.24 218.11 228.48 242.98 241.36 250.50 5555555 FFFFFFFiiiiiiinnnnnnnaaaaaaannnnnnnccccccceeeeeee 303.94 424.84 516.65 501.45 510.31 523.38 514.75 544.08 564.99 562.66 546.43 557.92 6666666 SSSSSSStttttttaaaaaaannnnnnndddddddaaaaaaarrrrrrrddddddd &&&&&&& PPPPPPPoooooooooooooorrrrrrr'''''''sssssss CCCCCCCooooooorrrrrrrpppppppooooooorrrrrrraaaaaaatttttttiiiiiiiooooooonnnnnnn (((((((1111111999999944444441111111-------44444443333333 ======= 11111110000000)))))))2222222 670.49 873.43 1,085.50 1,144.43 1,190.05 1,248.77 1,246.58 1,281.66 1,334.76 1,332.07 1,322.55 1,380.99 7777777 AAAAAAAmmmmmmmeeeeeeerrrrrrriiiiiiicccccccaaaaaaannnnnnn SSSSSSStttttttoooooooccccccckkkkkkk EEEEEEExxxxxxxccccccchhhhhhhaaaaaaannnnnnngggggggeeeeeee (((((((AAAAAAAuuuuuuuggggggg....... 33333331111111,,,,,,, 1111111999999977777773333333 ======= 55555550000000)))))))3333333 570.86 628.34 682.69 667.60 660.76 704.22 699.15 711.08 748.29 787.02 772.01 803.75 VVVVVVVooooooollllllluuuuuuummmmmmmeeeeeee ooooooofffffff tttttttrrrrrrraaaaaaadddddddiiiiiiinnnnnnnggggggg (((((((ttttttthhhhhhhooooooouuuuuuusssssssaaaaaaannnnnnndddddddsssssss ooooooofffffff ssssssshhhhhhhaaaaaaarrrrrrreeeeeeesssssss))))))) 8888888 NNNNNNNeeeeeeewwwwwww YYYYYYYooooooorrrrrrrkkkkkkk SSSSSSStttttttoooooooccccccckkkkkkk EEEEEEExxxxxxxccccccchhhhhhhaaaaaaannnnnnngggggggeeeeeee 409,740 523,254 666,534 668,932 680,397 847,135 756,932 776,538 874,818 785,778 723,025 721,294 9999999 AAAAAAAmmmmmmmeeeeeeerrrrrrriiiiiiicccccccaaaaaaannnnnnn SSSSSSStttttttoooooooccccccckkkkkkk EEEEEEExxxxxxxccccccchhhhhhhaaaaaaannnnnnngggggggeeeeeee 22,567 24,390 28,870 27,266 28,756 31,015 31,774 29,563 38,895 35,241 28,806 25,754 Customer financing (millions of dollars, end-of-period balances) 11111110000000 MMMMMMMaaaaaaarrrrrrrgggggggiiiiiiinnnnnnn cccccccrrrrrrreeeeeeedddddddiiiiiiittttttt aaaaaaattttttt bbbbbbbrrrrrrroooooookkkkkkkeeeeeeerrrrrrr-------dddddddeeeeeeeaaaaaaallllllleeeeeeerrrrrrrsssssss4444444 97,400 126,090 140,980 139,710 140,980 153,240 151,530 156,440 172,880 177,984 176,930 178,360 FFFFFFFrrrrrrreeeeeeeeeeeeee cccccccrrrrrrreeeeeeedddddddiiiiiiittttttt bbbbbbbaaaaaaalllllllaaaaaaannnnnnnccccccceeeeeeesssssss aaaaaaattttttt bbbbbbbrrrrrrroooooookkkkkkkeeeeeeerrrrrrrsssssss5555555 11111111111111 MMMMMMMaaaaaaarrrrrrrgggggggiiiiiiinnnnnnn aaaaaaaccccccccccccccooooooouuuuuuunnnnnnntttttttsssssss6666666 22,540 31.410 40,250 40,620 40,250 36,880 38,850 40,120 41,200 41,250 42,865 44,330 11111112222222 CCCCCCCaaaaaaassssssshhhhhhh aaaaaaaccccccccccccccooooooouuuuuuunnnnnnntttttttsssssss 40,430 52,160 62,450 56,170 62,450 59,600 57,910 59,435 60,870 61,665 64,100 60,000 Margin requirements (percent of market value and effective date)7 Mar. 11, 1968 June 8, 1968 May 6, 1970 Dec. 6, 1971 Nov. 24, 1972 Jan. 3, 1974 11111113333333 MMMMMMMaaaaaaarrrrrrrgggggggiiiiiiinnnnnnn ssssssstttttttoooooooccccccckkkkkkksssssss 70 80 65 55 65 50 11111114444444 CCCCCCCooooooonnnnnnnvvvvvvveeeeeeerrrrrrrtttttttiiiiiiibbbbbbbllllllleeeeeee bbbbbbbooooooonnnnnnndddddddsssssss 50 60 50 50 50 50 11111115555555 SSSSSSShhhhhhhooooooorrrrrrrttttttt sssssssaaaaaaallllllleeeeeeesssssss 70 80 65 55 65 50 1. Daily data on prices are available upon request to the Board of Governors. For ordering 6. Series initiated in June 1984. address, see inside front cover. 7. Margin requirements, stated in regulations adopted by the Board of Governors pursuant 2. In July 1976 a financial group, composed of banks and insurance companies, was added to the Securities Exchange Act of 1934, limit the amount of credit that can be used to to the group of stocks on which the index is based. The index is now based on 400 industrial purchase and carry "margin securities" (as defined in the regulations) when such credit is stocks (formerly 425), 20 transportation (formerly 15 rail), 40 public utility (formerly 60), and collateralized by securities. Margin requirements on securities are the difference between the 40 financial. market value (100 percent) and the maximum loan value of collateral as prescribed by the 3. On July 5, 1983, the American Stock Exchange rebased its index, effectively cutting Board. Regulation T was adopted effective Oct. 15, 1934; Regulation U, effective May 1, previous readings in half. 1936; Regulation G, effective Mar. 11, 1968; and Regulation X, effective Nov. 1, 1971. 4. Since July 1983, under the revised Regulation T, margin credit at broker-dealers has On Jan. 1, 1977, the Board of Governors for the first time established in Regulation T the included credit extended against stocks, convertible bonds, stocks acquired through the initial margin required for writing options on securities, setting it at 30 percent of the current exercise of subscription rights, corporate bonds, and government securities. Separate report- market value of the stock underlying the option. On Sept. 30, 1985, the Board changed the ing of data for margin stocks, convertible bonds, and subscription issues was discontinued in required initial margin, allowing it to be the same as the option maintenance margin required April 1984. by the appropriate exchange or self-regulatory organization; such maintenance margin rules 5. Free credit balances are amounts in accounts with no unfulfilled commitments to must be approved by the Securities and Exchange Commission. brokers and are subject to withdrawal by customers on demand. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A25 1.38 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Fiscal year Calendar year TTTyyypppeee ooofff aaaccccccooouuunnnttt ooorrr ooopppeeerrraaatttiiiooonnn 1999 11999966 11999977 11999988 Feb. Mar. Apr. May June July U.S. budget1 1 Receipts, total 1,453,062 1,579,292 1,721,798 99,414 130,292 266,142 98,587 199,479 121,905 2 On-budget 1,085,570 1,187,302 1,305,999 65,058 92,425 219,403 62,646 156,901 87,941 3 Off-budget 367,492 391,990 415,799 34,356 37,867 46,739 35,941 42,578 33,964 4 Outlays, total 1,560,512 1,601,235 1,652,552 141,760 152,701 152,683 122,556 145,911 147,068 5 On-budget 1,259,608 1,290,609 1,335,948 110,486 121,999 123,376 91,358 136,113 117,634 6 Off-budget 300,904 310,626 316,604 31,274 30,702 29,307 31,197 9,799 29,434 7 Surplus or deficit (—), total -107,450 -21,943 69,246 -42,345 -22,409 113,459 -23,969 53,568 -25,164 8 On-budget -174,038 -103,307 -29,949 -45,428 -29,574 96,027 -28,712 20,788 -29,693 9 Off-budget 66,588 81,364 99,195 3,082 7,165 17,432 4,744 32,779 4,530 Source of financing (total) 10 Borrowing from the public 129,712 38,171 -51,049 1,688 37,013 -85,208 -551 -22,246 1,193 11 Operating cash (decrease, or increase (-)) -6,276 604 4,743 52,432 -16,988 -36,512 32,495 -27,459 13,553 12 Other2 -15,986 -16,832 -22,940 -11,775 2,384 8,261 -7,975 -3,863 10,418 MEMO 13 Treasury operating balance (level, end of period) 44,225 43,621 38,878 4,638 21,626 58,138 25,643 53,102 39,549 14 Federal Reserve Banks 7,700 7,692 4,952 4,538 5,374 10,040 5,506 6,720 4,984 15 Tax and loan accounts 36,525 35,930 33,926 100 16,252 48,098 20,586 46,382 34,565 1. Since 1990, off-budget items have been the social security trust funds (federal old-age net gain or loss for U.S. currency valuation adjustment; net gain or loss for IMF loansurvivors insurance and federal disability insurance) and the U.S. Postal Service. valuation adjustment; and profit on sale of gold. 2. Includes special drawing rights (SDRs); reserve position on the U.S. quota in the SOURCE. Monthly totals: U.S. Department of the Treasury, Monthly Treasury Statement of International Monetary Fund (IMF); loans to the IMF; other cash and monetary assets; Receipts and Outlays of the U.S. Government; fiscal year totals: U.S. Office of Management accrued interest payable to the public; allocations of SDRs; deposit funds; miscellaneous and Budget, Budget of the U.S. Government. liability (including checks outstanding) and asset accounts; seigniorage; increment on gold; Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A26 Domestic Nonfinancial Statistics • October 1999 1.39 U.S. BUDGET RECEIPTS AND OUTLAYS1 Millions of dollars Fiscal year Calendar year SSSooouuurrrccceee ooorrr tttyyypppeee 1997 1998 1999 1999 11999977 11999988 H2 HI H2 HI May June July RECEIPTS 1 AH sources 1,579,292 1,721,798 773,810 922,630 825,057 965,636 98,587 199,479 121,905 2 Individual income taxes, net 737,466 828,586 354,072 447,514 392,332 481,527 30,585 92,993 59,975 3 Withheld 580,207 646,483 306,865 316,309 339,144 351,068 50,727 57,716 59,717 4 Nonwithheld 250,753 281,527 58,069 219,136 65,204 240,278 4,119 37,706 3,262 5 Refunds 93,560 99,476 10,869 87,989 12,032 109,875 24,273 22,,443388 3,006 Corporation income taxes 6 Gross receipts 204,493 213,249 104,659 109,353 104,163 106,861 5,176 40,610 5,303 7 Refunds 22,198 24,593 10,135 14,220 14,250 17,092 1,229 1,346 1,898 8 Social insurance taxes and contributions, net . . . 539,371 571,831 260,795 312,713 268,466 324,831 53,698 55,144 46,368 9 Employment taxes and contributions2 506,751 540,014 247,794 293,520 256,142 306,235 45,617 54,380 44,392 10 Unemployment insurance 28,202 27,484 10,724 17,080 10,121 16,378 7,731 370 1,573 11 Other net receipts3 4,418 4,333 2,280 2,112 2,202 2,216 350 393 403 12 Excise taxes 56,924 57,673 31,133 29,922 33,366 31,015 4,978 5,880 5,723 13 Customs deposits 17,928 18,297 9,679 8,546 9,838 8,440 1,256 1,599 1,725 14 Estate and gift taxes 19,845 24,076 10,262 12,971 12,359 14,915 1,942 1,857 1,938 15 Miscellaneous receipts4 25,465 32,658 13,348 15,829 18,735 15,140 2,181 2,742 2,771 OUTLAYS 16 All types 1,601,235 1,652,552 824,368 815,884 877,412 816,828 122,556 145,911 147,068 17 National defense 270,473 268,456 140,873 129,351 140,196 134,414 19,211 24,122 26,153 18 International affairs 15,228 13,109 9,420 4,610 8,297 6,879 640 1,053 569 19 General science, space, and technology 17,174 18,219 10,040 9,426 10,142 9,319 1,581 1,800 1,597 20 Energy 1,483 1,270 411 957 699 797 104 557 -13 21 Natural resources and environment 21,369 22,396 11,106 10,051 12,671 10.351 1,595 1,906 1,935 22 Agriculture 9,032 12,206 10,590 2,387 16,757 9,803 487 2,591 489 23 Commerce and housing credit -14,624 1,014 -3,526 -2,483 4,046 -1,629 989 -116 64 24 Transportation 40,767 40,332 20,414 16,196 20,836r 17,082 3,010 3,882 3,375 25 Community and regional development 11,005 9,720 5,749 4,863 6,972 5,368 906 1,201 755 26 Education, training, employment, and social services 53,008 54,919 26,851 25,928 27,760 29,003 4,464 4,143 3,980 27 Health 123,843 131,440 63,552 65,053 67,836 69,320 10,657 12,307 11,685 28 Social security and Medicare 555,273 572,047 283,109 286,305 316,809 261,146 44,519 52,990 51,157 29 Income security 230,886 233,202 106,353 125,196 109,481 126,144 12,880 14,574 20,514 30 Veterans benefits and services 39,313 41,781 22,077 19,615 22,750 20,105 1,893 3,619 5,130 31 Administration of justice 20,197 22,832 10,212 11,287 12,041 13,149 1,886 2,536 1,935 32 General government 12,768 13,444 7,302 6,139 9,136 6,650 621 3,508 1,360 33 Net interest5 244,013 243,359 122,620 122,345 116,954 116,655 19,976 18,518 19,598 34 Undistributed offsetting receipts6 -49,973 -47,194 -22,795 -21,340 -25,795 -17,724 -2,864 -3,278 -3,214 1. Functional details do not sum to total outlays for calendar year data because revisions to 4. Deposits of earnings by Federal Reserve Banks and other miscellaneous receipts. monthly totals have not been distributed among functions. Fiscal year total for receipts and 5. Includes interest received by trust funds. outlays do not correspond to calendar year data because revisions from the Budget have not 6. Rents and royalties for the outer continental shelf, U.S. government contributions for been fully distributed across months. employee retirement, and certain asset sales. 2. Old-age, disability, and hospital insurance, and railroad retirement accounts. SOURCE. Fiscal year totals: U.S. Office of Management and Budget, Budget of the U.S. 3. Federal employee retirement contributions and civil service retirement and Government, Fiscal Year 2000; monthly and half-year totals: U.S. Department of the Treadisability fund. sury, Monthly Treasury Statement of Receipts and Outlays of the US. Government. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A25 1.40 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars, end of month 1997 1998 1999 IItteemm June 30 Sept. 30 Dec. 31 Mar. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 30 1 Federal debt outstanding 5,410 5,446 5,536 5,573 5,578 5,556 5,643 5,681r 5,668 2 Public debt securities 5,376 5,413 5,502 5,542 5,548 5,526 5,614 5,652 5,639 3 Held by public 3,805 3,815 3,847 3,872 3,790 3,761 3,787 3,795 n.a. 4 Held by agencies 1,572 1,599 1,656 1,670 1,758 1,766 1,827 1,857 n.a. 5 Agency securities 34 33 34 31 30 29 29 29r 29 6 Held by public 26 26 27 26 26 26 29 28 n.a. 7 Held by agencies 7 7 7 5 4 4 1 1 n.a. 8 Debt subject to statutory limit 5,290 5,328 5,417 5,457 5,460 5,440 5,530 5,566 5,552 9 Public debt securities 5,290 5,328 5,416 5,456 5,460 5,439 5,530 5,566 5,552 10 Other debt' 0 0 0 0 0 0 0 0 0 MEMO 11 Statutory debt limit 5,500 5,950 5,950 5,950 5,950 5,950 5,950 5,950 5,950 1. Consists of guaranteed debt of U.S. Treasury and other federal agencies, specified SOURCE. U.S. Department of the Treasury, Monthly Statement of the Public Debt of the participation certificates, notes to international lending organizations, and District of Colum- United States and Treasury Bulletin. bia stadium bonds. 1.41 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1998 1999 TTyyppee aanndd hhoollddeerr 11999955 11999966 11999977 11999988 Q3 Q4 Ql Q2 1 Total gross public debt 4,988.7 5,323.2 5,502.4 5,614.2 5,526.2 5,614.2 5,651.6 5,638.8 By type 2 Interest-bearing 4,964.4 5,317.2 5,494.9 5,605.4 5,518.7 5,605.4 5,643.1 5,629.5 3 Marketable 3,307.2 3,459.7 3,456.8 3,355.5 3,331.0 3,355.5 3,361.3 3,248.5 4 Bills 760.7 777.4 715.4 691.0 637.7 691.0 725.5 647.8 5 Notes 2,010.3 2,112.3 2,106.1 1,960.7 2,009.1 1,960.7 1,912.0 1,8 i8.5 6 Bonds 521.2 555.0 587.3 621.2 610.4 621.2 632.5 632.5 7 Inflation-indexed notes and bonds1 n.a. n.a. 33.0 50.6 41.9 50.6 59.2 59.9 8 Nonmarketable2 1,657.2 1,857.5 2,038.1 2,249.9 2,187.7 2,249.9 2,281.8 2,381.0 9 State and local government series 104.5 101.3 124.1 165.3 164.4 165.3 167.5 172.6 10 Foreign issues3 40.8 37.4 36.2 34.3 35.1 34.3 33.5 30.9 11 Government 40.8 47.4 36.2 34.3 35.1 34.3 33.5 30.9 12 Public .0 .0 .0 .0 .0 .0 .0 .0 13 Savings bonds and notes 181.9 182.4 181.2 180.3 180.8 180.3 180.6 180.0 14 Government account series4 1,299.6 1,505.9 1,666.7 1,840.0 1,777.3 1,840.0 1,870.2 1,967.5 15 Non-interest-bearing 24.3 6.0 7.5 8.8 7.5 8.8 8.5 9.3 By holder5 16 U.S. Treasury and other federal agencies and trust funds 1,304.5 1,497.2 1,655.7 1,826.8 1,765.6 1,826.8 1,857.1 17 Federal Reserve Banks 391.0 410.9 451.9 471.7 458.1 471.7 464.5 18 Private investors 3,307.7 3,431.2 3,414.6 3,334.0 3,313.2 3,334.0 3,327.6 19 Depository institutions 315.4 296.6 300.3 237.1 243.5 237.1 n.a. 20 Mutual funds 286.4 315.8 321.3 351.1 327.8 351.1 n.a. 21 Insurance companies 241.5 214.1 176.6 184.2 182.5 184.2 n.a. n.a. 22 State and local treasuries6 289.8 257.0 239.3 237.3 254.4 237.3 n.a. Individuals 23 Savings bonds 185.0 187.0 186.5 186.7 186.0 186.7 186.6 24 Pension funds 474.5 505.1 539.1 557.3 549.0 557.3 n.a. 25 Private 298.7 314.6 334.3 361.9 352.2 361.9 n.a. 26 State and Local 175.8 190.5 204.8 195.4 196.8 195.4 n.a. 27 Foreign and international7 835.2 1,102.1 1,241.6 1,276.3 1,221.8 1,276.3 1,268.4 28 Other miscellaneous investors6'8 679.8 553.5 409.9 304.0 348.4 304.0 n.a. 1. The U.S. Treasury first issued inflation-indexed securities during the first quarter of 1997. 7. Includes nonmarketable foreign series treasury securities and treasury deposit funds. 2. Includes (not shown separately) securities issued to the Rural Electrification Administra- Excludes treasury securities held under repurchase agreements in custody accounts at the tion, depository bonds, retirement plan bonds, and individual retirement bonds. Federal Reserve Bank of New York. 3. Nonmarketable series denominated in dollars, and series denominated in foreign cur- 8. Includes individuals, government-sponsored enterprises, brokers and dealers, bank rency held by foreigners. personal trusts and estates, corporate and noncorporate businesses, and other investors. 4. Held almost entirely by U.S. Treasury and other federal agencies and trust funds. SOURCE. U.S. Treasury Department, data by type of security, Monthly Statement of the 5. Data for Federal Reserve Banks and U.S. government agencies and trust funds are actual Public Debt of the United States; data by holder, Treasury Bulletin. holdings; data for other groups are Treasury estimates. 6. In March 1996, in a redefinition of series, fully defeased debt backed by nonmarketable federal securities was removed from "Other miscellaneous investors" and added to "State and local treasuries." The data shown here have been revised accordingly. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic Nonfinancial Statistics • October 1999 1.42 U.S. GOVERNMENT SECURITIES DEALERS Transactions1 Millions of dollars, daily averages 1999 1999, week ending item Apr. May June June 2 June 9 June 16 June 23 June 30 July 7 July 14 July 21 July 28 OUTRIGHT TRANSACTIONS2 By type of security 1 U.S. Treasury bills 2288,,667700 3300,,779911 2288,,995544 44,136 26,723 28,957 28,737 25,325 27,182 22,184 25,392 21,697 Coupon securities, by maturity 2 Five years or less 8877,,779999 110099,,773366 9988,,773388 106,003 87,777 98,614 109,472 96,184 88,369 92,147 96,071 95,315 3 More than five years 53,786 76,896 61,981 66,867 57,031 69,981 58,992 59,964 51,859 58,826 48,561 52,692 4 Inflation-indexed 1,415 1,147 1,278 1,368 730 1,573 1,620 1,154 2,719 1,831 275 934 Federal agency 5 Discount notes 3377,,334455 4422,,116611 4444,,558800 43,296 42,921 44,185 45,409 46,320 52,486 40,079 40,327 40,365 Coupon securities, by maturity 6 One year or less 11,,222222 11,,119944 667777 1,248 423 807 743 505 649 681 413 810 7 More than one year, but less than or equal to five years 6,875 5,966 5,526 3,978 6,850 4,278 4,466 7,127 3,729 5,195 3,456 5,780 8 More than five years 4,625 4,333 4,256 3,013 7,717 4,275 3,004 2,524 2,266 4,990 5,405 3,835 9 Mortgage-backed 69,382 73,553 72,636 52,876 85,323 99,470 57,709 55,947 75,744 103,433 50,217 49,315 By type of counterparty With interdealer broker 10 U.S. Treasury 93,341 118,422 103,512 115,167 96,344 108,996 107,973 96,074 89,684 97,134 92,603 93,702 11 Federal agency 3,904 4,202 3,636 2,751 4,148 3,606 3,771 3,373 2,998 3,644 4,026 3,509 12 Mortgage-backed 23,682 26,585 26,565 20,066 31,289 33,004 23,007 21,558 25,896 32,366 19,405 23,394 With other 13 U.S. Treasury 78,330 100,149 87,439 103,208 75,918 90,129 90,848 86,552 80,445 77,853 77,696 76,936 14 Federal agency 46,162 49,452 51,402 48,783 53,762 49,938 49,851 53,103 56,132 47,301 45,575 47,281 15 Mortgage-backed 45,700 46,968 46,072 32,810 54,034 66,466 34,702 34,389 49,849 71,067 30,812 25,921 FUTURES TRANSACTIONS3 By type of deliverable security 16 U.S. Treasury bills 0 n.a. 0 n.a. n.a. n.a. 0 0 0 0 0 0 Coupon securities, by maturity 17 Five years or less 1,947 3,921 3,813 8,515 3,878 3,729 3,494 2,272 2,670 2,428 1,460 2,851 18 More than five years 11,950 18,045 14,278 19,888 13,311 15,059 13,695 12,802 12,078 14,767 10,616 11,915 19 Inflation-indexed 0 0 0 0 0 0 0 0 0 0 0 0 Federal agency 20 Discount notes 0 0 0 0 0 0 0 0 0 0 0 0 Coupon securities, by maturity 21 One year or less 0 0 0 0 0 0 0 0 0 0 0 0 22 More than one year, but less than or equal to five years 0 0 0 0 0 0 0 0 0 0 0 0 23 More than five years 0 0 0 0 0 0 0 0 0 0 0 0 24 Mortgage-backed 0 0 0 0 0 0 0 0 0 0 0 0 OPTIONS TRANSACTIONS4 By type of underlying security 25 U.S. Treasury bills 0 0 0 0 0 0 0 0 0 0 0 0 Coupon securities, by maturity 26 Five years or less 985 1,434 1,725 1,816 1,924 2,048 1,438 1,453 1,422 493 967 933 27 More than five years 4,657 6,556 4,992 5,383 4,946 4,607 6,116 4,144 3,450 4,716 3,720 3,780 28 Inflation-indexed 0 0 0 0 0 0 0 0 0 0 0 0 Federal agency 29 Discount notes 0 0 0 0 0 0 0 0 0 0 0 0 Coupon securities, by maturity 30 One year or less 0 0 0 0 0 0 0 0 0 0 0 0 31 More than one year, but less than or equal to five years 0 0 0 0 n.a. n.a. 0 0 n.a. n.a. 0 0 32 More than five years 0 0 0 0 n.a. 0 0 0 0 0 0 0 33 Mortgage-backed 783 827 779 612 1,056 735 871 519 1,911 1,162 740 1,033 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 US. government securities dealers on its published list of delayed delivery. Forward contracts for U.S. Treasury securities and federal agency debt primary dealers. Monthly averages are based on the number of trading days in the month. securities are included when the time to delivery is more than five business days. Forward Transactions are assumed to be evenly distributed among the trading days of the report week. contracts for mortgage-backed agency securities are included when the time to delivery is Immediate, forward, and futures transactions are reported at principal value, which does not more than thirty business days. include accrued interest; options transactions are reported at the face value of the underlying 3. Futures transactions are standardized agreements arranged on an exchange. All futures securities. 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 on 2. Outright transactions include immediate and forward transactions. Immediate delivery an organized exchange or in the over-the-counter market, and include options on futures refers to purchases or sales of securities (other than mortgage-backed federal agency securi- contracts on U.S. Treasury and federal agency securities. ties) for which delivery is scheduled in five business days or less and "when-issued" NOTE, "n.a." indicates that data are not published because of insufficient activity. securities that settle on the issue date of offering. Transactions for immediate delivery of mortgagebacked agency securities include purchases and sales for which delivery is scheduled in thirty business days or less. Stripped securities arc reported at market value by maturity of coupon or corpus. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A25 1.43 U.S. GOVERNMENT SECURITIES DEALERS Positions and Financing1 Millions of dollars 1999 1999, week ending IItteemm Apr. May June June 2 June 9 June 16 June 23 June 30 July 7 July 14 July 21 Positions2 NET OUTRIGHT POSITIONS3 By type of security 1 U.S. Treasury bills 24,563 6,146 3,929 14,784 8,035 584 3,279 718 2,005 2,231 6,403 Coupon securities, by maturity 2 Five years or less -14,332 -33,183 -30,024 -34,104 -33,478 -33,837 -27,785 -23,830 -26,206 -20,426 -26,617 3 More than five years -5,060 -11,576 -15,615 -12,003 -15,259 -16,490 -15,219 -16,523 -16,843 -16,676 -14,005 4 Inflation-indexed 2,618 2,523 2,036 2,282 2,291 2,211 1,870 1,701 3,250 3,051 2,983 Federal agency 5 Discount notes 24,321 19,406 16,953 16,847 18,208 19,790 15,999 13,845 23,313 24,717 16,857 Coupon securities, by maturity 6 One year or less 2,538 2,439 2,518 2,091 2,450 2,627 2,611 2,505 2,991 3,282 3,229 7 More than one year, but less than or equal to five years 3,991 6,001 6,288 4,742 5,978 6,901 5,442 7,273 8,095 8,614 7,655 8 More than five years 6,131 6,705 6,450 5,943 9,292 6,797 5,468 4,389 3,810 3,618 3,470 9 Mortgage-backed 12,875 16,251 14,787 13,776 14,450 12,849 18,844 13,294 21,758 20,409 19,606 NET FUTURES POSITIONS4 By type of deliverable security 10 U.S. Treasury bills n.a. n.a. 00 n.a. n.a. 00 00 00 00 00 00 Coupon securities, by maturity 11 Five years or less 93 7,117 8,731 6,104 8,742 8,852 9,919 8,162 7,599 6,368 6,354 12 More than five years -17,408 -4,873 -827 -1,355 -2,451 -326 -42 -336 -1,797 -4,517 -9,047 13 Inflation-indexed 0 0 0 0 0 0 0 0 0 0 0 Federal agency 14 Discount notes 0 00 00 00 00 00 00 00 00 00 00 Coupon securities, by maturity 15 One year or less 00 00 00 00 00 00 00 00 00 00 00 16 More than one year, but less than or equal to five years 0 0 0 0 0 0 0 0 0 0 0 17 More than five years 0 0 0 0 0 0 0 0 0 0 0 18 Mortgage-backed 0 0 0 0 0 0 0 0 0 0 0 NET OPTIONS POSITIONS By type of deliverable security 19 U.S. Treasury bills 00 00 00 00 00 00 00 00 00 00 00 Coupon securities, by maturity 20 Five years or less -1,180 -142 -2,266 111 -1,374 -2,230 -2,791 -3,348 -3,163 -2,221 -983 21 More than five years -396 -1,581 -1,000 -753 -1,159 -272 -1,230 -1,410 -833 -409 -259 22 Inflation-indexed n.a. n.a. 0 n.a. n.a. n.a. 0 0 0 n.a. 0 Federal agency 23 Discount notes 0 00 00 00 00 00 0 00 00 00 00 Coupon securities, by maturity 24 One year or less 00 00 00 00 00 00 00 00 00 00 00 25 More than one year, but less than or equal to five years 0 00 00 00 n.a. n.a. n.a. n.a. n.a. n.a. n.a. 26 More than five years n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 27 Mortgage-backed 5,579 7,992 5,880 8,257 8,416 6,247 5,412 2,765 2,433 2,964 943 Financing5 Reverse repurchase agreements 78 Overnight and continuing 251,605 262,314 272,933 276,464 250,601 283,399 261,829 294,893 277,344 262,182 245,999 29 Term 818,297 806,177 790,804 745,598 803,032 824,794 846,179 702,127 778,711 806,537 835,362 Securities borrowed 30 Overnight and continuing 212,240 226,515 244,326 240,721 234,845 248,702 243,760 251,029 259,881 256,145 253,568 31 Term 102,440 97,977 91,955 85,116 91,587 90,676 96,640 90,872 88,437 89,560 91,383 Securities received as pledge 32 Overnight and continuing n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 33 Term 0 0 0 n.a. n.a. 0 0 0 n.a. n.a. n.a. Repurchase agreements 34 Overnight and continuing 677,260 660,275 651,952 657,693 639,636 672,973 650,226 643,332 675,783 686,633 671,765 35 Term 711,067 693,158 674,583 631,770 676,202 699,832 731,503 603,027 651,619 675,913 691,902 Securities loaned 36 Overnight and continuing 10,235 10,819 13,306 10,988 11,799 12,487 12,000 17,599 11,098 11,956 11,249 37 Term 5,942 6,566 5,886 6,528 6,003 6,074 6,093 5,190 6,732 6,184 7,307 Securities pledged 38 Overnight and continuing 45,650 47,279 49,670 46,461 44,679 45,196 52,037 57,683 56,751 56,164 55,411 39 Term 10,700 9,702 9,290 8,582 8,781 9,182 9,907 9,491 9,512 9,814 9,456 Collateralized loans 40 Total 17,891 16,223 14,760 18,417 17,414 17,966 13,101 9,512 13,496 17,095 17,096 1. Data for positions and financing are obtained from reports submitted to the Federal securities are included when the time to delivery is more than five business days. Forward Reserve Bank of New York by the U.S. government securities dealers on its published list of contracts for mortgage-backed agency securities are included when the time to delivery is primary dealers. Weekly figures are close-of-business Wednesday data. Positions for calendar more than thirty business days. days of the report week are assumed to be constant. Monthly averages are based on the 4. Futures positions reflect standardized agreements arranged on an exchange. All futures number of calendar days in the month. positions are included regardless of time to delivery. 2. Securities positions are reported at market value. 5. Overnight financing refers to agreements made on one business day that mature on the 3. Net outright positions include immediate and forward positions. Net immediate posi- next business day; continuing contracts are agreements that remain in effect for more than one tions include securities purchased or sold (other than mortgage-backed agency securities) that business day but have no specific maturity and can be terminated without advance notice by have been delivered or are scheduled to be delivered in five business days or less and either party; term agreements have a fixed maturity of more than one business day. Financing "when-issued" securities that settle on the issue date of offering. Net immediate positions for data are reported in terms of actual funds paid or received, including accrued interest. mortgage-backed agency securities include securities purchased or sold that have been NOTE, "n.a." indicates that data are not published because of insufficient activity. delivered or are scheduled to be delivered in thirty business days or less. Forward positions reflect agreements made in the over-the-counter market that specify delayed delivery. Forward contracts for U.S. Treasury securities and federal agency debt Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 Domestic Nonfinancial Statistics • October 1999 1.44 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt Outstanding Millions of dollars, end of period 1999 Agency 11999955 11999966 11999977 11999988 Jan. Feb. Mar. Apr. May 1 Federal and federally sponsored agencies 844,611 925,823 1,022,609 1,296,477 1,311,010 1,324,812 1,347,872 1,377,524 1,404,576 2 Federal agencies 37,347 29,380 27,792 26,502 26,355 26,180 26,243 26,100 26,094 3 Defense Department1 6 6 6 6 6 6 6 6 6 4 Export-Import Bank2'3 2,050 1,447 552 n.a. n.a. n.a. n.a. n.a. n.a. 5 Federal Housing Administration4 97 84 102 205 70 69 80 84 88 6 Government National Mortgage Association certificates of participation5 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 7 Postal Service6 5,765 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 8 Tennessee Valley Authority 29,429 27,853 27,786 26,496 26,349 26,174 26,237 26,094 26,088 9 United States Railway Association6 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 10 Federally sponsored agencies7 807,264 896,443 994,817 1,269,975 1,284,655 1,298,632 1,321,629 1,351,424 1,378,482 11 Federal Home Loan Banks 243,194 263,404 313,919 382,131 383,572 383,769 402,364 415,602 421,655 12 Federal Home Loan Mortgage Corporation 119,961 156,980 169,200 287,396 300,927 299,171 299,196 310,387 317,533 13 Federal National Mortgage Association 299,174 331,270 369,774 460,291 461,157 471,300 475,418 478,994 492,913 14 Farm Credit Banks8 57,379 60,053 63,517 63,488 61,292 66,622 66,529 67,527 66,608 15 Student Loan Marketing Association9 47,529 44,763 37,717 35,399 36,385 36,464 36,762 37,660 38,129 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 29,996 29,996 29,996 29,996 29,996 29,996 29,996 29,996 29,996 19 F M e E d M er O a l Financing Bank debt13 78,681 58,172 49,090 44,129 43,803 43,151 41,454 41,637 41,131 2 2 0 1 E P Le o x n s p t d o a i r n l t g - S I e m t r o p v o f i e c r d e t e 6 r B a a l nk a 3 n d federally sponsored agencies 2 5, , 7 0 6 4 5 4 n 1 . , a 4 . 3 1 n.a. 5 52 • T fI T fT T T 22 Student Loan Marketing Association n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 2 2 3 4 T U e n n it n e e d s s S e t e a t V es a l R le a y i l A w u a t y h o A r s it s y o ciation6 n 3 . , a 2 . 0 0 n n . . a a . . n n . . a a . . • 1 • 1 T 1 1 T t 1 T I Other lending14 25 Farmers Home Administration 21,015 18,325 13,530 9,500 9,500 9,090 8,715 8,550 8,275 26 Rural Electrification Administration 17,144 16,702 14,898 14,091 14,101 14,100 13,980 13,999 13,997 27 Other 29,513 21,714 20,110 20,538 20,202 19,961 18,759 19,088 18,859 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 insurance 12. The Resolution Funding Corporation, established by the Financial Institutions Reform, claims. Once issued, these securities may be sold privately on the securities market. Recovery, and Enforcement Act of 1989, undertook its first borrowing in October 1989. 5. Certificates of participation issued before fiscal year 1969 by the Government National 13. The FFB, which began operations in 1974, is authorized to purchase or sell obligations Mortgage Association acting as trustee for the Farmers Home Administration, the Department issued, sold, or guaranteed by other federal agencies. Because FFB incurs debt solely for the of Health, Education, and Welfare, the Department of Housing and Urban Development, the purpose of lending to other agencies, its debt is not included in the main portion of the table to Small Business Administration, and the Veterans Administration. 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. Includes guaranteed by numerous agencies, with the amounts guaranteed by any one agency generally Federal Agricultural Mortgage Corporation, therefore details do not sum to total. Some data being small. The Farmers Home Administration entry consists exclusively of agency assets, are estimated. whereas the Rural Electrification Administration entry consists of both agency assets and 8. Excludes borrowing by the Farm Credit Financial Assistance Corporation, which is 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

Securities Markets and Corporate Finance A31 1.45 NEW SECURITY ISSUES Tax-Exempt State and Local Governments Millions of dollars 1998 1999 TTyyppee ooff iissssuuee oorr iissssuueerr,, oorr uussee 11999966 11999977 11999988 Dec. Jan. Feb. Mar. Apr. May June July 1 All issues, new and refunding1 171,222 214,694 262,342 24,288 16,926 16,233 24,323 15,758 16,234 23,428 18,671 By type of issue 2 General obligation 60,409 69,934 87,015 8,632 6,925 6,786 8,323 6,443 5,294 10,997 6,206 3 Revenue 110,813 134,989 175,327 15,656 10,001 9,446 16,000 9,315 10,941 12,431 12,465 By type of issuer 4 State 13,651 18,237 23,506 2,561 318 1,837 1,895 907 1,220 1,236 2,194 5 Special district or statutory authority2 113,228 134,919 178,421 15,937 12,929 11,145 14,604 10,010 11,279 18,414 13,572 6 Municipality, county, or township 44,343 70,558 60,173 5,790 3,679 3,251 7,825 4,841 3,735 3,779 2,906 7 Issues for new capital 112,298 135,519 160,568 14,517 11,917 10,674 16,201 10,474 12,149 19,509 12,172 By use of proceeds 8 Education 26,851 31,860 36,904 2,766 2,936 3,751 3,537 2,734 2,795 3,793 3,415 9 Transportation 12,324 13,951 19,926 1,800 1,706 628 1,640 1,107 1,791 1,650 1,264 10 Utilities and conservation 9,791 12,219 21,037 984 672 394 2,839 1,372 603 1,594 535 11 Social welfare 24,583 27,794 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. 12 Industrial aid 6,287 6,667 8,594 1,376 452 343 1,084 618 1,058 739 850 13 Other purposes 32,462 35,095 42,450 4,477 4,439 3,207 3,918 2,592 3,760 7,195 2,729 1. Par amounts of long-term issues based on date of sale. SOURCE. Securities Data Company beginning January 1990; Investment Dealer's 2. Includes school districts. Digest before then. 1.46 NEW SECURITY ISSUES U.S. Corporations Millions of dollars 1998 1999 TTyyppee ooff iissssuuee,, ooffffeerriinngg,, 11999966 11999977 11999988 oorr iissssuueerr Nov. Dec. Jan. Feb. Mar. Apr/ May June 1 All issues1 773,110 929,256 l,128,491r 111,762 82,317'' 93,665 103,175 126,161 85,862 110,475 96,291 2 Bonds2 651,104 811,376 1,001,736' 102,860 73,647r 86,529 92,885 116,440 76,721 94,713 88,337 By type of offering 3 Sold in the United States 567,671 708,188 923,771r 95,106 70,386r 76,511 82,871 101,024 65,886 86,730 79,031 4 Sold abroad 83,433 103,188 77,965 7,754 3,261 10,018 10,014 15,416 10,834 7,983 9,306 MEMO 5 Private placements, domestic 43,688 54,990 37,845 2,878 3,874 684 648 1,224 n.a. n.a. n.a. By industry group 6 Nonfinancial 167,904 222,603 307,935r 32,124 25,008 21,193 23,131 39,818 30,676 32,843 22,931 7 Financial 483,200 588,773 693,801r 70,736 48,639r 65,336 69,754 76,623 46,045 61,870 63,807 8 Stocks3 122,006 117,880 126,755 8,902 8,670 7,136 10,290 9,721 9,141 15,762 7,954 By type of offering 9 Public 122,006 117,880 126,755 8,902 8,670 7,136 10,290 9,721 9,141 15,762 7,954 10 Private placement4 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. By industry group 11 Nonfinancial 80,460 60,386 74,113 6,145 7,559 3,701 8,911 8,534 7,640 10,425 6,303 12 Financial 41,546 57,494 52,642 2,757 1,111 3,435 1,379 1,187 1,501 5,337 1,651 1. Figures represent gross proceeds of issues maturing in more than one year; they are the 2. Monthly data include 144(a) offerings. principal amount or number of units calculated by multiplying by the offering price. Figures 3. Monthly data cover only public offerings. exclude secondary offerings, employee stock plans, investment companies other than closed- 4. Data are not available. end, intracorporate transactions, and Yankee bonds. Stock data include ownership securities SOURCE. Securities Data Company and the Board of Governors of the Federal Reserve issued by limited partnerships. System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 Domestic Nonfinancial Statistics • October 1999 1.47 OPEN-END INVESTMENT COMPANIES Net Sales and Assets1 Millions of dollars 1998 1999 IItteemm 11999977 11999988 Dec. Jan. Feb. Mar. Apr. May Juner July 1 Sales of own shares2 1,190,900 1,461,430 140,700 161,889 132,199 164,290 166,324 140,422 138,502 140,518 2 Redemptions of own shares 918,728 1,217,022 134,289 135,713 128,125 146,479 139,035 127,800 117,953 128,227 3 Net sales3 272,172 244,408 6,412 26,176 4,074 17,811 27,288 12,622 20,550 12,291 4 Assets4 3,409,315 4,173,531 4,173,531 4,298,071 4,180,115 4,328,150 4,505,237 4,442,880 4,650,385 4,584,097 5 Cash5 174,154 191,393 191,393 203,470 198,134 198,741 211,243 211,580 214,779 209,264 6 Other 3,235,161 3,982,138 3,982,138 4,094,601 3,981,982 4,129,409 4,293,994 4,231,300 4,435,607 4,374,833 1. Data include stock, hybrid, and bond mutual funds and exclude money market mutual 4. Market value at end of period, less current liabilities. funds. 5. Includes all U.S. Treasury securities and other short-term debt securities. 2. Excludes reinvestment of net income dividends and capital gains distributions and share SOURCE. Investment Company Institute. Data based on reports of membership, which issue of conversions from one fund to another in the same group. comprises substantially all open-end investment companies registered with the Securities and 3. Excludes sales and redemptions resulting from transfers of shares into or out of money Exchange Commission. Data reflect underwritings of newly formed companies after their market mutual funds within the same fund family. initial offering of securities. 1.48 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data at seasonally adjusted annual rates 1997 1998 1999 AAccccoouunntt 11999966 11999977 11999988 Q3 Q4 Ql Q2 Q3 Q4 Ql Q2 1 Profits with inventory valuation and capital consumption adjustment 750.4 817.9 824.6 840.9 820.8 829.2 820.6 827.0 821.7 868.8 859.6 2 Profits before taxes 680.2 734.4 717.8 758.9 736.4 719.1 723.5 720.5 708.1 752.6 768.2 3 Profits-tax liability 226.1 246.1 240.1 254.2 249.3 239.9 241.6 243.2 235.6 250.7 257.5 4 Profits after taxes 454.1 488.3 477.7 504.7 487.1 479.2 481.8 477.3 472.5 501.9 510.7 5 Dividends 261.9 275.1 279.2 275.1 276.4 277.3 278.1 279.0 282.3 285.6 289.7 6 Undistributed profits 192.3 213.2 198.5 229.5 210.6 201.8 203.7 198.3 190.2 216.4 221.0 7 Inventory valuation -1.2 6.9 14.5 4.8 4.3 25.3 7.8 11.7 13.4 11.6 -17.1 8 Capital consumption adjustment 71.4 76.6 92.3 77.2 80.1 84.9 89.4 94.8 100.2 104.6 108.6 SOURCE. U.S. Department of Commerce, Survey of Current Business. 1.51 DOMESTIC FINANCE COMPANIES Assets and Liabilities1 Billions of dollars, end of period; not seasonally adjusted 1997 1998 1999 AAccccoouunntt 11999966 11999977 11999988 Q4 Ql Q2 Q3 Q4 Qlr Q2 ASSETS 1 Accounts receivable, gross2 637.1 663.3 711.7 663.3 667.2 676.0 687.6 711.7 733.8 756.5 2 Consumer 244.9 256.8 261.8 256.8 251.7 251.3 254.0 261.8 261.7 269.2 .3 Business 309.5 318.5 347.5 318.5 325.9 334.9 335.1 347.5 362.8 373.7 4 Real estate 82.7 87.9 102.3 87.9 89.6 89.9 98.5 102.3 109.2 113.5 5 LESS: Reserves for unearned income 55.6 52.7 56.3 52.7 52.1 53.2 52.4 56.3 52.9 53.4 6 Reserves for losses 13.1 13.0 13.8 13.0 13.1 13.2 13.2 13.8 13.4 13.4 7 Accounts receivable, net 568.3 597.6 641.6 597.6 601.9 609.6 622.0 641.6 667.6 689.7 8 All other 290.0 312.4 337.9 312.4 329.7 340.1 313.7 337.9 363.3 373.2 9 Total assets 858.3 910.0 979.5 910.0 931.6 949.7 935.7 979.5 1,030.8 1,062.9 LIABILITIES AND CAPITAL 10 Bank loans 19.7 24.1 26.3 24.1 22.0 22.3 24.9 26.3 24.8 25.1 11 Commercial paper 177.6 201.5 231.5 201.5 211.7 225.9 226.9 231.5 222.9 231.0 Debt 12 Owed to parent 60.3 64.7 61.8 64.7 64.6 60.0 58.3 61.8 64.6 65.4 13 Not elsewhere classified 332.5 328.8 339.7 328.8 338.2 348.7 337.6 339.7 366.7 383.1 14 All other liabilities 174.7 189.6 203.2 189.6 193.1 188.9 185.4 203.2 220.3 226.1 15 Capital, surplus, and undivided profits 93.5 101.3 117.0 101.3 102.1 103.9 103.6 117.0 131.5 132.2 16 Total liabilities and capital 858.3 910.0 979.5 910.0 931.6 949.7 936.6 979.5 1,030.8 1,062.9 1. Includes finance company subsidiaries of bank holding companies but not of retailers 2. Before deduction for unearned income and losses, 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. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Market and Corporate Finance A33 1.52 DOMESTIC FINANCE COMPANIES Owned and Managed Receivables1 Billions of dollars, amounts outstanding 1999 TTyyppee ooff ccrreeddiitt 11999966 11999977 11999988 Jan. Feb. Mar. Apr. May June Seasonally adjusted 1 Total 761.9 809.8 874.9 888.2 898.4 911.3 919.5r 932.5 938.9 2 Consumer 307.7 327.7 352.5 356.5 360.7 363.4 363.2r 369.2 370.6 3 Real estate 111.9 121.1 131.4 135.7 135.7 137.5 141.2r 142.8 141.2 4 Business 342.4 361.0 391.0 396.0 402.0 410.4 415.2r 420.5 427.1 Not seasonally adjusted 5 Total 769.7 818.1 884.0 888.4 897.8 911.9 919.4r 931.6 942.4 6 Consumer 310.6 330.9 356.1 355.8 357.4 359.7 360.9r 368.3 374.0 7 Motor vehicles loans 86.7 87.0 103.1 102.8 105.0 104.7 106.8 105.1 108.6 8 Motor vehicle leases 92.5 96.8 93.3 93.9 94.5 93.9 94.8 95.3 95.6 9 Revolving2 32.5 38.6 32.3 32.1 31.5 31.2 31.5 31.7 32.4 10 Other3 33.2 34.4 33.1 32.1 32.5 32.0 32.0 32.0 32.6 Securitized assets4 11 Motor vehicle loans 36.8 44.3 54.8 56.0 54.9 59.0 57.8 65.8 65.4 12 Motor vehicle leases 8.7 10.8 12.7 12.5 12.3 12.0 11.8 11.6 11.3 13 Revolving .0 .0 8.7 8.6 8.7 9.1 8.8 8.6 9.7 14 Other 20.1 19.0 18.1 17.9 18.1 17.8 17.6 18.3 18.4 15 Real estate 111.9 121.1 131.4 135.7 135.7 137.5 141.2r 143.2 141.2 16 One- to four-family 52.1 59.0 75.7 80.1 80.3 77.7 81.7 83.6 80.5 17 Other 30.5 28.9 26.6 26.9 27.1 31.6 31.6 31.9 33.0 Securitized real estate assets4 18 One- to four-family 28.9 33.0 29.0 28.6 28.3 28.0 21.& 27.4 27.0 19 Other .4 .2 .1 .1 .1 .3 .3 .3 .2 20 Business 347.2 366.1 396.5 396.9 404.6 414.8 416.3 418.2 427.1 21 Motor vehicles 67.1 63.5 79.6 79.1 82.1 84.8 86.2 84.4 82.8 22 Retail loans 25.1 25.6 28.1 28.4 28.9 30.0 30.7 31.6 30.9 23 Wholesale loans3 33.0 27.7 32.8 31.9 34.3 36.0 36.5 33.8 32.7 24 Leases 9.0 10.2 18.7 18.9 18.9 18.8 18.9 19.0 19.2 25 Equipment 194.8 203.9 198.0 197.6 200.7 202.3 203.1 203.7 208.3 26 Loans 59.9 51.5 50.4 49.7 51.0 51.6 52.0 51.7 53.3 27 Leases 134.9 152.3 147.6 147.8 149.8 150.7 151.0 152.0 155.1 28 Other business receivables6 47.6 51.1 69.9 72.5 73.3 75.7 75.8 76.7 82.6 Securitized assets4 29 Motor vehicles 24.0 33.0 29.2 28.2 28.8 31.0 30.5 32.0 32.1 30 Retail loans 2.7 2.4 2.6 2.5 2.4 2.4 2.4 2.2 2.9 31 Wholesale loans 21.3 30.5 24.7 23.8 24.6 26.6 26.2 27.8 27.2 32 Leases .0 .0 1.9 1.9 1.9 1.9 1.9 1.9 2.0 33 Equipment 11.3 10.7 13.0 12.7 12.9 12.8 12.5 13.2 13.3 34 Loans 4.7 4.2 6.6 6.3 6.2 6.1 5.8 6.5 6.7 35 Leases 6.6 6.5 6.4 6.4 6.7 6.7 6.6 6.6 6.6 36 Other business receivables6 2.4 4.0 6.8 6.8 6.8 8.2 8.3 8.3 8.0 NOTE. This table has been revised to incorporate several changes resulting from the before deductions for unearned income and losses. Components may not sum to totals benchmarking of finance company receivables to the June 1996 Survey of Finance Compa- because of rounding. nies. In that benchmark survey, and in the monthly surveys that have followed, more detailed 2. Excludes revolving credit reported as held by depository institutions that are subsidiarbreakdowns have been obtained for some components. In addition, previously unavailable ies of finance companies. data on securitized real estate loans are now included in this table. The new information has 3. Includes personal cash loans, mobile home loans, and loans to purchase other types of resulted in some reclassification of receivables among the three major categories (consumer, consumer goods such as appliances, apparel, boats, and recreation vehicles. real estate, and business) and in discontinuities in some component series between May and 4. Outstanding balances of pools upon which securities have been issued; these balances June 1996. are no longer carried on the balance sheets of the loan originator. Includes finance company subsidiaries of bank holding companies but not of retailers and 5. Credit arising from transactions between manufacturers and dealers, that is, floor plan banks. Data in this table also appear in the Board's G.20 (422) monthly statistical release. For financing. ordering address, see inside front cover. 6. Includes loans on commercial accounts receivable, factored commercial accounts, and 1. Owned receivables are those carried on the balance sheet of the institution. Managed receivable dealer capital; small loans used primarily for business or farm purposes; and receivables are outstanding balances of pools upon which securities have been issued; these wholesale and lease paper for mobile homes, campers, and travel trailers. balances are no longer carried on the balance sheets of the loan originator. Data are shown Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A34 Domestic Nonfinancial Statistics • October 1999 1.53 MORTGAGE MARKETS Mortgages on New Homes Millions of dollars except as noted 1999 IItteemm 11999966 11999977 11999988 Jan. Feb. Mar. Apr. May June July Terms and yields in primary and secondary markets PRIMARY MARKETS Terms1 1 Purchase price (thousands of dollars) 182.4 180.1 195.2 202.3 204.1 211.0 209.4 207.5 211.0 207.6 2 Amount of loan (thousands of dollars) 139.2 140.3 151.1 153.3 155.4 162.9 162.4 161.6 162.0 158.2 3 Loan-to-price ratio (percent) 78.2 80.4 80.0 78.0 78.2 79.4 79.5 79.8 79.0 78.6 4 Maturity (years) 27.2 28.2 28.4 28.4 28.7 28.8 28.9 28.7 28.6 28.5 5 Fees and charges (percent of loan amount)2 1.21 1.02 .89 1.01 .92 .82 .77 .69 .72 .83 Yield (percent per year) 6 Contract rate1 7.56 7.57 6.95 6.81 6.78 6.74 6.74 6.78 6.92 7.15 7 Effective rate1'3 7.77 7.73 7.08 6.96 6.92 6.86 6.85 6.89 7.03 7.29 8 Contract rate (HUD series)4 8.03 7.76 7.00 6.80 7.02 7.03 6.93 7.17 7.59 7.75 SECONDARY MARKETS Yield (percent per year) 9 FHA mortgages (Section 203)5 8.19 7.89 7.04 7.08 7.10 7.07 7.08 7.58 8.13 8.00 10 GNMA securities6 7.48 7.26 6.43 6.18 6.42 6.58 6.50 6.79 7.21 7.28 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 11 Total 287,052 316,678 414,515 418,323 431,836 440,139 446,025 464,530 473,315r 480,651 12 FHA/VA insured 30,592 31,925 33,770 33,483 34,000 34,870 36,158 38,938 41,143 n.a. 13 Conventional 256,460 284,753 380,745 384,840 397,836 405,269 409,867 425,592 432,172 n.a. 14 Mortgage transactions purchased (during period) 68,618 70,465 188,448 14,005 22,029 16,923 14,225 25,640 15,934 14,004 Mortgage commitments (during period) 15 Issued7 65,859 69,965 193,795 20,754 26,509 16,891 20,192 12,517 19,507 12,966 16 To sell8 130 1,298 1,880 0 0 266 75 178 351 260 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period f 1/ Total 137,755 164,421 255,010 257,062 262,921 277,624 284,006 285,881 299,184 300,093 18 FHA/VA insured 220 177 785 387 755 754 1,613 1,610 1,726r 1,725 19 Conventional 137,535 164,244 254,225 256,675 262,166 276,870 282,393 284,271 297,458r 298,368 Mortgage transactions (during period) 20 Purchases 125,103 117,401 267,402 27,680 25,225 29,921 26,473 22,503 21,950 17,602 21 Sales 119,702 114,258 250,565 31,430 24,231 28,740 25,464 21,972 20,349 16,835 22 Mortgage commitments contracted (during period)9 128,995 120,089 281,899 23,900 24,829 32,546 24,050 20,052 21,610 n.a. 1. Weighted averages based on sample surveys of mortgages originated by major institu- 6. Average net yields to investors on fully modified pass-through securities backed by tional lender groups for purchase of newly built homes; compiled by the Federal Housing mortgages and guaranteed by the Government National Mortgage Association (GNMA), 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 the Federal Housing Administration or guaranteed by the Department of Veterans Affairs. 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 U.S. 9. Includes conventional and government-underwritten loans. The Federal Home Loan Department of Housing and Urban Development (HUD). Based on transactions on the first Mortgage Corporation's mortgage commitments and mortgage transactions include activity day of the subsequent month. under mortgage securities swap programs, whereas the corresponding data for FNMA 5. Average gross yield on thirty-year, minimum-downpayment first mortgages insured exclude swap activity. 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

Real Estate A35 1.54 MORTGAGE DEBT OUTSTANDING1 Millions of dollars, end of period 1998 1999 TTyyppee ooff hhoollddeerr aanndd pprrooppeerrttyy 11999955 11999966 11999977 Ql Q2 Q3 Q4 Qlp 1 All holders 4,604,408 4,898,791 5,212,899 5,323,116 5,434,606 5,568,971 5,723,504 5,860,041 By type of property 2 One- to four-family residences 3,510,749 3,726,748 3,969,525 4,055,368 4,135,647 4,238,430 4,343,358 4,441,804 3 Multifamily residences 277,001 294,396 308,794 314,636 321,223 327,661 337,736 347,448 4 Nonfarm, nonresidential 732,097 790,513 844,281 861,819 884,814 908,635 946,096 973,710 5 84,561 87,134 90,299 91,291 92,923 94,244 96,315 97,080 By type of holder 6 Major financial institutions 1,900,089 1,981,885 2,083,978 2,114,077 2,121,531 2,136,776 2,194,959 2,198,641 7 Commercial banks2 1,090,189 1,145,389 1,245,315 1,270,586 1,281,440 1,295,173 1,337,545 1,337,140 8 One- to four-family 646,545 677,603 745,510 764,656 770,438 770,489 797,746 783,291 9 Multifamily 42,521 45,451 49,670 51,007 51,449 52,443 53,123 56,430 in Nonfarm, nonresidential 377,293 397,452 423,148 427,465 431,234 443,553 457,642 467,907 11 Farm 23,830 24,883 26,986 27,458 28,319 28,688 29,034 29,512 12 Savings institutions3 596,763 628,335 631,822 637,012 632,359 634,244 643,773 646,202 13 One- to four-family 482,353 513,712 520,672 527,036 522,088 525,842 533,680 534,490 14 Multifamily 61,987 61,570 59,543 59,074 58,908 56,706 56,806 56,761 15 Nonfarm, nonresidential 52,135 52,723 51,252 50,532 50,978 51,297 52,871 54,516 16 Farm 288 331 354 369 386 399 417 435 17 Life insurance companies 213,137 208,161 206,841 206,479 207,732 207,359 213,640 215,299 18 One- to four-family 8,890 6,977 7,187 6,979 6,814 6,594 6,590 6,631 19 Multifamily 28,714 30,750 30,402 30,394 30,618 30,565 31,522 31,004 20 Nonfarm, nonresidential 165,876 160,314 158,780 158,493 159,456 159,189 164,004 166,060 21 Farm 9,657 10,120 10,472 10,613 10,844 11,011 11,524 11,604 22 Federal and related agencies 308,757 295,192 286,167 286,877 287,161 287,125 292,636 288,312 23 Government National Mortgage Association 2 2 8 8 8 7 7 7 24 One- to four-family 2 2 8 8 8 7 7 7 25 Multifamily 0 0 0 0 0 0 0 0 26 Farmers Home Administration 41,791 41,596 41,195 40,972 40,921 40,907 40,851 40,691 27 One- to four-family 17,705 17,303 17,253 17,160 17,059 17,025 16,895 16,777 28 Multifamily 11,617 11,685 11,720 11,714 11,722 11,736 11,739 11,731 29 Nonfarm, nonresidential 6,248 6,841 7,370 7,369 7,497 7,566 7,705 7,769 30 Farm 6,221 5,768 4,852 4,729 4,644 4,579 4,513 4,413 31 Federal Housing and Veterans' Administrations 9,809 6,244 3,821 3,694 3,631 3,405 3,674 3,675 32 One- to four-family 5,180 3,524 1,767 1,641 1,610 1,550 1,849 1,850 33 Multifamily 4,629 2,719 2,054 2,053 2,021 1,855 1,825 1,825 34 Resolution Trust Corporation 1,864 0 0 0 0 0 0 0 35 One- to four-family 691 0 0 0 0 0 0 0 36 Multifamily 647 0 0 0 0 0 0 0 37 Nonfarm, nonresidential 525 0 0 0 0 0 0 0 38 Farm 0 0 0 0 0 0 0 0 39 Federal Deposit Insurance Corporation 4,303 2,431 724 786 564 482 361 315 40 One- to four-family 492 365 109 118 85 72 54 47 41 Multifamily 428 413 123 134 96 82 61 54 42 Nonfarm, nonresidential 3,383 1,653 492 534 384 328 245 214 43 Farm 0 0 0 0 0 0 0 0 44 Federal National Mortgage Association 178,807 168,813 161,308 160,048 159,816 159,104 157,675 157,185 45 One- to four-family 163,648 155,008 149,831 149,254 149,383 149,069 147,594 147,063 46 Multifamily 15,159 13,805 11,477 10,794 10,433 10,035 10,081 10,122 47 Federal Land Banks 28,428 29,602 30,657 31,005 31,352 32,009 32,983 33,128 48 One- to four-family 1,673 1,742 1,804 1,824 1,845 1,883 1,941 1,949 49 Farm 26,755 27,860 28,853 29,181 29,507 30,126 31,042 31,179 50 Federal Home Loan Mortgage Corporation 43,753 46,504 48,454 50,364 50,869 51,211 57,085 53,312 51 One- to four-family 39,901 41,758 42,629 44,440 44,597 44,254 49,106 44,139 52 Multifamily 3,852 4,746 5,825 5,924 6,272 6,957 7,979 9,173 53 Mortgage pools or trusts5 1,863,210 2,064,882 2,272,953 2,330,799 2,442,558 2,548,192 2,632,893 2,761,941 54 Government National Mortgage Association 472,283 506,340 536,810 533,011 537,586 541,431 537,431 542,409 55 One- to four-family 461,438 494,158 523,156 519,152 523,243 526,934 522,483 527,461 56 Multifamily 10,845 12,182 13,654 13,859 14,343 14,497 14,948 14,948 57 Federal Home Loan Mortgage Corporation 515,051 554,260 579,385 583,144 609,791 635,726 646,459 687,179 58 One- to four-family 512,238 551,513 576,846 580,715 607,469 633,124 643,465 684,240 59 Multifamily 2,813 2,747 2,539 2,429 2,322 2,602 2,994 2,939 60 Federal National Mortgage Association 582,959 650,780 709,582 730,832 761,359 798,460 834,518 881,815 61 One- to four-family 569,724 633,210 687,981 708,125 737,631 770,979 804,205 849,513 62 Multifamily 13,235 17,570 21,601 22,707 23,728 27,481 30,313 32,302 63 Farmers Home Administration 11 3 2 2 2 2 1 1 64 One- to four-family 2 0 0 0 0 0 0 0 65 Multifamily 0 0 0 0 0 0 0 0 66 Nonfarm, nonresidential 5 0 0 0 0 0 0 0 67 Farm 4 3 2 2 2 2 1 1 68 Private mortgage conduits 292,906 353,499 447,173 483,810 533,820 572,573 614,484 650,537 69 One- to four-family6 227,800 261,900 318,000 336,824 364,316 391,736 410,900 430,653 70 Multifamily 15,584 21,967 29,218 33,432 38,098 40,895 44,654 48,403 71 Nonfarm, nonresidential 49,522 69,633 99,955 113,554 131,406 139,942 158,930 171,482 72 Farm 0 0 0 0 0 0 0 0 73 Individuals and others7 532,353 556,832 569,802 591,363 583,357 596,877 603,017 611,147 74 One- to four-family 372,468 367,973 376,773 397,437 389,063 398,871 406,843 413,692 75 Multifamily 64,969 68,791 70,966 71,116 71,213 71,806 71,691 71,756 76 Nonfarm, nonresidential 77,109 101,898 103,284 103,871 103,860 106,761 104,699 105,763 77 Farm 17,806 18,169 18,779 18,939 19,221 19,440 19,784 19,937 1. Multifamily debt refers to loans on structures of five or more units. 6. Includes securitized home equity loans. 2. Includes loans held by nondeposit trust companies but not loans held by bank trust 7. Other holders include mortgage companies, real estate investment trusts, state and local departments. credit agencies, state and local retirement funds, noninsured pension funds, credit unions, and 3. Includes savings banks and savings and loan associations. finance companies. 4. FmHA-guaranteed securities sold to the Federal Financing Bank were reallocated from SOURCE. Based on data from various institutional and government sources. Separation of FmHA mortgage pools to FmHA mortgage holdings in 1986:Q4 because of accounting nonfarm mortgage debt by type of property, if not reported directly, and interpolations and changes by the Farmers Home Administration. extrapolations, when required for some quarters, are estimated in part by the Federal Reserve. 5. Outstanding principal balances of mortgage-backed securities insured or guaranteed by Line 69 from Inside Mortgage Securities and other sources. the agency indicated. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 Domestic Nonfinancial Statistics • October 1999 1.55 CONSUMER CREDIT1 Millions of dollars, amounts outstanding, end of period 1999 HHoollddeerr aanndd ttyyppee ooff ccrreeddiitt 11999966 11999977 11999988 Jan. Feb. Mar. Apr. Ma/ June Seasonally adjusted 1 Total 1,182,439 1,234,122 1,300,491 1,315,653 1,325,101 1,332,139 l,332,500r 1,344,205 1,347,035 2 Revolving 499,532 531,295r 560,653 565,035 566,858 567,283 569,923r 571,914 576,031 3 Nonrevolving2 682,907 702,828 739,838 750,619 758,244 764,857 762,577r 772,291 771,004 Not seasonally adjusted 4 Total 1,211,590 1,264,103 1,331,742 1,324,528 1,318,872 1,318,611 1,321,860r 1,332,039 1,339,641 By major holder 5 Commercial banks 526,769 512,563 508,932 508,635 500,429 494,039 495,873 495,821 482,091 6 Finance companies 152,391 160,022 168,491 166,979 169,013 167,815 170,145r 168,490 173,617 7 Credit unions 144,148 152,362 155,406 155,726 155,203 155,110 155,933 156,924 156,621 8 Savings institutions 44,711 47,172 51,611 52,283 52,953 53,623 54,294 54,964 55,634 9 Nonfinancial business 77,745 78,927 74,877 70,947 67,948 67,138 67,114r 68,050 68,024 10 Pools of securitized assets3 265,826 313,057 372,425 369,958 373,326 380,886 378,501r 387,790 403,654 By major type of credit4 11 Revolving 522,860 555,858 586,528 574,901 567,549 561,542 563,969r 565,976 569,990 12 Commercial banks 228,615 219,826 210,346 204,774 197,623 190,028 191,295 190,216 177,370 13 Finance companies 32,493 38,608 32,309 32,088 31,544 31,197 31,327r 31,296 32,408 14 Credit unions 17,826 19,552 19,930 19,295 19,202 18,894 19,044 19,008 19,195 15 Savings institutions 10,313 11,441 12,450 12,425 12,399 12,373 12,348 12,322 12,296 16 Nonfinancial business 44,901 44,966 39,166 36,401 34,337 33,754 33,726 34,446 34,618 17 Pools of securitized assets3 188,712 221,465 272,327 269,918 272,444 275,296 276,229 278,688 294,103 18 Nonrevolving credit 688,730 708,245 745,214 749,627 751,323 757,069 757,891r 766,063 769,651 19 Commercial banks 298,154 292,737 298,586 303,861 302,806 304,011 304,578 305,605 304,721 20 Finance companies 119,898 121,414 136,182 134,891 137,469 136,618 138,818 137,194 141,209 21 Credit unions 126,322 132,810 135,476 136,431 136,001 136,216 136,889 137,916 137,426 22 Savings institutions 34,398 35,731 39,161 39,858 40,554 41,250 41,946 42,642 43,338 23 Nonfinancial business 32,844 33,961 35,711 34,546 33,611 33,384 33,388r 33,604 33,406 24 Pools of securitized assets3 77,114 91,592 100,098 100,040 100,882 105,590 102,272 109,102 109,551 1. The Board's series on amounts of credit covers most short- and intermediate-term credit 3. Outstanding balances of pools upon which securities have been issued; these balances extended to individuals. Data in this table also appear in the Board's G.19 (421) monthly are no longer carried on the balance sheets of the loan originator. statistical release. For ordering address, see inside front cover. 4. Totals include estimates for certain holders for which only consumer credit totals are 2. Comprises motor vehicle loans, mobile home loans, and all other loans that are not available. included in revolving credit, such as loans for education, boats, trailers, or vacations. These loans may be secured or unsecured. 1.56 TERMS OF CONSUMER CREDIT1 Percent per year except as noted 1998 1999 IItteemm 11999966 11999977 11999988 Dec. Jan. Feb. Mar. Apr. May June INTEREST RATES Commercial banks2 1 48-month new car 9.05 9.02 8.72 n.a. n.a. 8.34 n.a. n.a. 8.30 n.a. 2 24-month personal 13.54 13.90 13.74 n.a. n.a. 13.41 n.a. n.a. 13.26 n.a. Credit card plan 3 All accounts 15.63 15.77 15.71 n.a. n.a. 15.41 n.a. n.a. 15.21 n.a. 4 Accounts assessed interest 15.50 15.57 15.59 n.a. n.a. 14.73 n.a. n.a. 14.94 n.a. Auto finance companies 5 New car 9.84 7.12 6.30 6.43 6.22 6.43 6.31 6.52 6.57 6.60 6 Used car 13.53 13.27 12.64 12.31 11.81 12.08 12.09 12.17 12.16 12.31 OTHER TERMS3 Maturity (months) 7 New car 51.6 54.1 52.1 52.2 52.1 53.4 53.0 52.8 52.4 52.3 8 Used car 51.4 51.0 53.5 54.2 56.0 55.9 56.0 56.0 56.1 56.0 Loan-to-value ratio 9 New car 91 92 92 91 92 92 91 92 92 92 10 Used car 100 99 99 100 99 99 99 99 99 100 Amount financed (dollars) 11 New car 16,987 18,077 19,083 19,734 19,628 19,304 19,339 19,435 19,539 19,722 12 Used car 12,182 12,281 12,691 13,202 13,497 13,604 13,653 13,647 13,700 13,816 1. The Board's series on amounts of credit covers most short- and intermediate-term credit 2. Data are available for only the second month of each quarter, extended to individuals. Data in this table also appear in the Board's G.19 (421) monthly 3. At auto finance companies, statistical release. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A3 9 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS1 Billions of dollars; quarterly data at seasonally adjusted annual rates 1997 19 98' 1999 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr Q4' Ql Q2 Q3 Q4 Ql' Q2 Nonfinancial sectors 1 Total net borrowing by domestic nonfinancial sectors . . . 584.4r 575.8r 720.4r 743.0r 785.3r 912.0 1,075.5 1,042.4 899.2 1,072.8 1,248.1 865.6 By sector and instrument 2 Federal government 256.1 155.8r 144.4 145.0 23.1 -5.5 -14.5 -28.4 -113.5 -54.1 -75.2 -112.2 3 Treasury securities 248.3 155.7 142.9 146.6 23.2 -7.3 -12.1 -26.9 -113.1 -66.3 -73.7 -112.8 4 Budget agency securities and mortgages 7.8 .2 1.5 -1.6 -.1 1.7 -2.4 -1.4 -.4 12.2 -1.5 .6 5 Nonfederal 328.3r 420.0r 576.0" 598.0* 162.2' 917.5 1,090.0 1,070.8 1,012.6 1,127.0 1,323.3 977.8 By instrument 6 Commercial paper 10.0 21.4 18.1 -.9 13.7 12.8 51.1 3.8 85.6 -43.0 64.4 3.4 7 Municipal securities and loans 74.8 -35.9 -48.2 2.6 71.4 99.9 113.5 101.3 82.9 89.6 100.7 48.0 8 Corporate bonds 75.2 23.3 9i.r 116.3r 150.5r 163.6 278.8 294.8 108.0 193.2 274.0 260.8 9 Bank loans n.e.c 6.4 75.2 103.7r 70.5r 106.5' 178.1 35.0 169.2 107.8 120.9 70.0 21.8 10 Other loans and advances -18.9 34.0 67.2 33.5r 69. lr 141.4 76.3 40.8 77.7 102.5 114.1 -5.3 11 Mortgages 122.4r 177.0 205.1 287.4r 298.4r 278.6 476.4 398.9 471.1 593.8 573.4 595.7 12 Home 160.1r 183.4' 179.8r 243.0 235.8 188.8 376.5 287.3 373.7 427.8 414.6 424.2 13 Multifamily residential -5.1 -2.1 7.6 11.5 10.8 18.3 21.6 21.1 16.1 30.6 35.9 36.8 14 Commercial -33.6 -6.5 16.2 30.4r 48.7r 68.6 74.1 83.8 75.9 126.8 119.3 125.4 1") Farm 1.0 2.2 1.6 2.6 3.2 2.9 4.1 6.7 5.5 8.6 3.6 9.3 16 Consumer credit 58.4r 124.9 138.9 88.8 52.5 43.1 58.9 62.1 79.6 69.9 126.6 53.2 By borrowing sector 17 Household 209.4r 316.3r 350.3r 351.7r 325.5r 311.1 463.3 418.5 471.9 527.3 553.3 511.0 18 Nonfinancial business 52.7 150.0 211.2' 253.2r 380.6r 520.3 532.5 570.3 470.7 524.6 682.6 431.1 19 Corporate 46.9 142.3r 243.7r 164.6r 297.C 425.0 426.9 467.4 365.8 413.7 574.4 320.6 20 Nonfarm noncorporate 3.2 3.3 30.6 83.8 77.4 86.6 97.1 95.4 97.6 103.3 101.6 111.2 ?.] Farm 2.6 4.4 2.9 4.8 6.2 8.6 8.4 7.5 7.3 7.5 6.6 -.7 22 State and local government 66.2 -46.2 -51.5 -6.8 56.1 86.2 94.2 82.0 70.0 75.1 87.4 35.7 23 Foreign net borrowing in United States 69.8 -13.9' 71.1 77.2' 57.6' 44.8 95.0 97.9 -19.6 -38.9 17.3 -43.3 24 Commercial paper -9.6 -26.1 13.5 11.3 3.7 .7 55.3 -25.5 6.2 -4.7 18.3 -27.1 25 Bonds 82.9 12.2 49.7 55.8 47.2' 34.2 42.5 119.2 -27.2 -34.2 .9 -19.1 26 Bank loans n.e.c .7 1.4 8.5 9.1 8.5 15.7 5.2 8.4 3.6 9.8 .9 5.7 27 Other loans and advances -4.2 — 1.4r -.5 1.0r -1.8' -5.8 -8.0 -4.2 -2.2 -9.7 -2.8 -2.7 28 Total domestic plus foreign 654.2r 561.9r 791.5r 820.3r 842.9r 956.8 1,170.4 1,140.3 879.5 1,034.0 1,265.4 822.4 Financial sectors 29 Total net borrowing by financial sectors 294.4 468.4 453.9r 548.9r 652.2r 961.5 931.3 988.9 1,056.3 1,298.7 1,216.0 1,014.1 By instrument 30 Federal government-related 165.3 287.5 204.1 231.5 212.8 290.9 249.2 405.4 555.8 673.3 592.3 579.3 31 Government-sponsored enterprise securities 80.6 176.9 105.9 90.4 98.4 157.9 142.5 166.4 294.0 510.5 193.0 304.7 32 Mortgage pool securities 84.7 115.4 98.2 141.1 114.5' 133.0 106.7 239.0 261.7 162.8 399.3 274.6 33 Loans from U.S. government .0 -4.8 .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 34 Private 129.1 180.9 249.8' 317.5r 439.4' 670.7 682.1 583.5 500.5 625.4 623.7 434.8 35 Open market paper -5.5 40.5 42.7 92.2 166.7 244.7 236.7 135.6 141.0 130.7 78.3 57.8 36 Corporate bonds 123.1 121.8 195.9 176.9 209.0 348.8 346.3 361.8 177.4 281.9 492.5 260.8 37 Bank loans n.e.c -14.4 -13.7 2.5r 12.6r 13.2' -4.7 57.3 -9.7 60.2 12.4 -8.8 10.5 38 Other loans and advances 22.4 22.6 3.4 27.9 35.6 61.7 32.7 76.0 82.3 169.9 41.6 117.9 39 Mortgages 3.6 9.8 5.3 7.9 14.9 20.1 9.1 19.9 39.6 30.6 20.1 -12.3 By borrowing sector 40 Commercial banking 13.4 20.1 22.5 13.0 46.1 61.4 82.8 80.8 61.7 66.3 31.1 61.6 41 Savings institutions 11.3 12.8 2.6 25.5 19.7 41.7 10.6 31.2 63.7 103.2 58.0 58.6 4? Credit unions .2 .2 -.1 .1 .1 .3 .5 .2 1.0 .4 1.5 1.4 43 Life insurance companies .2 .3 -.1 1.1 .2 -.3 .0 -.6 1.6 1.8 3.3 3.0 44 Government-sponsored enterprises 80.6 172.1 105.9 90.4 98.4 157.9 142.5 166.4 294.0 510.5 193.0 304.7 45 Federally related mortgage pools 84.7 115.4 98.2 141.1 114.5' 133.0 106.7 239.0 261.7 162.8 399.3 274.6 46 Issuers of asset-backed securities (ABSs) 85.4 76.5 142.4 153.9 200.7 374.8 283.0 352.4 294.2 335.7 302.2 318.3 47 Finance companies -1.4 48.7 50.2 45.9 48.7 70.7 74.6 91.9 -12.0 17.8 71.2 88.4 48 Mortgage companies .0 -11.5 —2.2r 4.1r -4.6' -46.8 29.4 -28.2 2.3 3.0 -4.6 5.1 49 Real estate investment trusts (REITs) 1.7 10.2 4.5 11.9 39.6 66.0 63.1 64.4 79.3 44.0 25.6 -19.7 50 Brokers and dealers 12.0 .5 -5.0 -2.0 8.1 7.0 -1.0 20.0 -2.6 12.4 -31.1 -18.3 51 Funding corporations 6.3 23.1 34.9 64.1 80.7 95.9 139.2 -28.6 11.2 40.9 166.5 -63.4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A38 Domestic Nonfinancial Statistics • October 1999 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS1—Continued 1997 1998r 1999 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999933 11999944 11999955 11999966 11999977 Q4< Q1 Q2 Q3 Q4 Qlr Q2 All sectors 55552222 TTTToooottttaaaallll nnnneeeetttt bbbboooorrrrrrrroooowwwwiiiinnnngggg,,,, aaaallllllll sssseeeeccccttttoooorrrrssss 948.6r l,030.3r l,245.4r l,369.2r l,495.1r 1,918.3 2,101.7 2,129.3 1,935.8 2,332.7 2,481.3 1,836.4 55553333 OOOOppppeeeennnn mmmmaaaarrrrkkkkeeeetttt ppppaaaappppeeeerrrr -5.1 35.7 74.3 102.6 184.1 258.2 343.0 113.8 232.7 83.0 161.1 34.1 55554444 UUUU....SSSS.... ggggoooovvvveeeerrrrnnnnmmmmeeeennnntttt sssseeeeccccuuuurrrriiiittttiiiieeeessss 421.4 448.1 348.5 376.5 235.9 285.3 234.7 377.1 442.3 619.1 517.1 467.1 55555555 MMMMuuuunnnniiiicccciiiippppaaaallll sssseeeeccccuuuurrrriiiittttiiiieeeessss 74.8 -35.9 -48.2 2.6 71.4 99.9 113.5 101.3 82.9 89.6 100.7 48.0 55556666 CCCCoooorrrrppppoooorrrraaaatttteeee aaaannnndddd ffffoooorrrreeeeiiiiggggnnnn bbbboooonnnnddddssss 281.2 157.3 336.7r 348.9r 406.7r 546.5 667.6 775.8 258.2 440.9 767.4 502.5 55557777 BBBBaaaannnnkkkk llllooooaaaannnnssss nnnn....eeee....cccc -7.2 62.9 114.7 92.1 128.2 189.2 97.6 167.9 171.6 143.0 62.1 38.0 55558888 OOOOtttthhhheeeerrrr llllooooaaaannnnssss aaaannnndddd aaaaddddvvvvaaaannnncccceeeessss -.8 50.4r 70. lr 62.5r 102.8r 197.4 101.0 112.5 157.8 262.7 152.9 110.0 55559999 MMMMoooorrrrttttggggaaaaggggeeeessss 126.01 186.8r 210.5r 295.3r 313.3r 298.7 485.5 418.7 510.7 624.4 593.5 583.5 66660000 CCCCoooonnnnssssuuuummmmeeeerrrr ccccrrrreeeeddddiiiitttt 58.4r 124.9 138.9 88.8 52.5 43.1 58.9 62.1 79.6 69.9 126.6 53.2 Funds raised through mutual funds and corporate equities 66661111 TTTToooottttaaaallll nnnneeeetttt iiiissssssssuuuueeeessss 429.7 125.2 144.3 228.9 188.4r 160.9 213.5 268.5 -147.2 18.3 140.6 6.4 66662222 CCCCoooorrrrppppoooorrrraaaatttteeee eeeeqqqquuuuiiiittttiiiieeeessss 137.7 24.6 -3.1 -8.6r —76.7r -100.0 -108.8 -109.3 -320.6 -206.5 -114.7 -241.5 66663333 NNNNoooonnnnffffiiiinnnnaaaannnncccciiiiaaaallll ccccoooorrrrppppoooorrrraaaattttiiiioooonnnnssss 21.3 -44.9 -58.3 -69.5 -114.4 -143.3 -139.2 -129.1 -308.4 -491.3 -65.7 -354.0 66664444 FFFFoooorrrreeeeiiiiggggnnnn sssshhhhaaaarrrreeeessss ppppuuuurrrrcccchhhhaaaasssseeeedddd bbbbyyyy UUUU....SSSS.... rrrreeeessssiiiiddddeeeennnnttttssss 63.4 48.1 50.4 60.0 42.0r 1.7 14.0 12.3 -32.8 317.4 -33.4 124.7 66665555 FFFFiiiinnnnaaaannnncccciiiiaaaallll ccccoooorrrrppppoooorrrraaaattttiiiioooonnnnssss 53.0 21.4 4.8 .8 -4.3r 41.6 16.4 7.5 20.5 -32.7 -15.6 -12.2 66666666 MMMMuuuuttttuuuuaaaallll ffffuuuunnnndddd sssshhhhaaaarrrreeeessss 292.0 100.6 147.4 237.6 265.1 260.9 322.3 377.8 173.4 224.8 255.3 247.9 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, tables F.2 through F.4. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A3 9 1.58 SUMMARY OF FINANCIAL TRANSACTIONS1 Billions of dollars except as noted; quarterly data at seasonally adjusted annual rates 1997 1998' 1999 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999933 11999944 11999955 11999966 11999977 Q4' Ql Q2 Q3 Q4 Qlr Q2 NET LENDING IN CREDIT MARKETS2 1 Total net lending in credit markets 948.6r l,030.3r l,245.4r l,369.2r l,495.1r 1,918.3 2,101.7 2,129.3 1,935.8 2,332.7 2,481.3 1,836.4 2 Domestic nonfederal nonfinancial sectors 231.2' -90.0' 22.5' -88.9' 48.1 -49.7 512.7 94.9 -318.3 307.5 347.9 Household - 10.6r 268.C 5.5' 61.4' -86.2' 7.5 -64.2 385.2 -44.8 -424.1 244.9 255.1 4 Nonfinancial corporate business 9.1 17.7 -8.8 -.8' -2.3' -13.0 8.4 -46.9 14.0 14.1 10.4 39.5 5 Nonfarm noncorporate business -1.1 .6 4.7 -4.3 -.6 -.6 .0 .0 .0 .0 .0 .0 6 State and local governments 32.6 -55.0 -91.4 -33.7 .1 54.2 6.1 174.3 125.7 91.7 52.2 53.3 7 Federal government -18.4 -27.4' -.2 -7.4' 5.1' 9.2 15.7 12.9 13.8 11.7 17.5 6.5 8 Rest of the world 129.3 132.3 273.9 414.4' 310.7' 203.9 223.8 321.8 60.8 390.7 213.3 51.6 9 Financial sectors 807.8r 694.1' 1,061.7' 939.7' 1,268. lr 1,657.1 1,912.0 1,281.9 1,766.3 2,248.6 1,943.0 1,430.5 10 Monetary authority 36.2 31.5 12.7 12.3 38.3 54.3 27.6 11.5 41.6 3.5 71.8 62.4 11 Commercial banking 142.2 163.4 265.9 187.5 324.3 447.4 306.7 132.7 250.1 531.5 68.9 135.0 1? U.S.-chartered banks 149.6 148.1 186.5 119.6 274.9 357.6 268.4 130.0 309.2 540.2 134.1 231.5 13 Foreign banking offices in United States -9.8 11.2 75.4 63.3 40.2 69.3 17.5 15.2 -68.1 -12.1 -54.9 -105.8 14 Bank holding companies .0 .9 -.3 3.9 5.4 19.4 15.3 -17.6 6.0 -7.4 -6.0 .1 15 Banks in U.S.-affiliated areas 2.4 3.3 4.2 .7 3.7 1.1 5.5 5.1 2.9 10.7 -4.4 9.2 16 Savings institutions -23.3 6.7 -7.6 19.9 -4.7 8.9 11.8 2.1 17.9 113.3 102.7 88.8 17 Credit unions 21.7 28.1 16.2 25.5 16.8 6.5 16.1 22.7 21.0 16.0 37.7 34.7 18 Bank personal trusts and estates 9.5 7.1 -8.3 -7.7 7.6 8.8 2.4 3.1 2.0 3.9 3.1 2.2 19 Life insurance companies 100.4 72.0 100.0 69.6 94.3 34.1 92.1 63.4 65.6 86.0 72.6 89.0 70 Other insurance companies 27.7 24.9 21.5 22.5 25.2 34.7 23.4 -1.5 -7.7 67.5 -19.7 5.0 21 Private pension funds 50.2 46.1 56.0 52.3 65.5 79.5 74.5 130.1 95.6 174.4 60.5 150.0 22 State and local government retirement funds 24.7r 30.9' 33.6' 37.3' 63.8' 42.7 67.4 78.4 65.6 48.5 74.3 37.4 ?3 Money market mutual funds 20.4 30.0 86.5 88.8 87.5 141.8 159.3 208.1 255.5 353.1 227.6 -92.6 ?4 Mutual funds 159.5 -7.1 52.5 48.9 80.9 64.8 156.4 146.4 92.9 103.5 101.5 98.8 ?5 Closed-end funds 20.0 -3.7 10.5 4.7 -2.9' -2.9 4.5 4.5 4.5 4.5 4.4 4.4 26 Government-sponsored enterprises 87.8 117.8 86.7 84.2 94.3 158.1 198.3 150.6 264.7 429.5 157.2 259.5 27 Federally related mortgage pools 84.7 115.4 98.2 141.1 114.5' 133.0 106.7 239.0 261.7 162.8 399.3 274.6 ?8 Asset-backed securities issuers (ABSs) 82.8 69.4 120.6 123.6 162.3 321.9 223.9 321.4 248.7 312.7 284.6 301.5 29 Finance companies -20.9 48.3 49.9 18.4 21.9 -19.7 28.7 24.0 79.5 75.3 92.2 79.6 30 Mortgage companies .0 -24.0 -3.4 8.2 -9.1 -93.6 58.8 -56.4 4.5 6.0 -9.1 10.2 31 Real estate investment trusts (REITs) .4 -.7 1.4 4.4 20.2 38.9 25.6 6.1 -11.3 -40.8 1.7 -2.2 32 Brokers and dealers 14.8 -44.2 90.1 -15.7 14.9 71.7 245.8 -183.1 77.0 -209.1 184.5 -204.5 33 Funding corporations -31.0r -17.8r -21.2' \4ff 52.7' 126.2 82.0 -21.4 -63.3 6.4 27.1 96.8 RELATION OF LIABILITIES TO FINANCIAL ASSETS 34 Net flows through credit markets 948.6r l,030.3r 1,245.4' l,369.2r l,495.1r 1,918.3 2,101.7 2,129.3 1,935.8 2,332.7 2,481.3 1,836.4 Other financial sources 35 Official foreign exchange .8 -5.8 8.8 -6.3 .7 17.5 1.0 88..11 88..99 88..66 --1144..00 --55..44 36 Special drawing rights certificates .0 .0 2.2 -.5 -.5 .0 .0 .0 .0 .0 -4.0 .0 37 Treasury currency .4 .7 .6 .1 .0 -1.9 .3 .2 1.7 -2.3 .0 .7 38 Foreign deposits -18.5 52.9 35.3 85.9 106.8' 100.6 -46.5 92.9 84.9 -131.9 127.7 114.5 39 Net interbank transactions 50.5 89.8 10.0' -51.6 -19.7 54.3 -95.2 39.8 44.2 -122.9 49.1 68.2 40 Checkable deposits and currency 117.3 -9.7 -12.7 15.8 41.5 72.1 52.6 90.1 -24.9 72.8 61.7 10.3 41 Small time and savings deposits -70.3 -39.9 96.6 97.2 97.1 136.7 99.0 84.9 144.7 281.2 -63.8 104.0 42 Large time deposits -23.5 19.6 65.6 114.0 122.5 59.2 187.8 -5.6 81.8 104.4 -5.9 42.6 43 Money market fund shares 20.2 43.3 142.3 145.8 157.6 149.9 213.6 247.2 367.9 313.1 204.9 100.5 44 Security repurchase agreements 71.3 78.2 110.5 41.4 120.9 103.3 250.3 -100.8 231.1 -170.3 408.2 -65.6 45 Corporate equities 137.7 24.6 -3.1 -8.6' -76.7' -100.0 -108.8 -109.3 -320.6 -206.5 -114.7 -241.5 46 Mutual fund shares 292.0 100.6 147.4 237.6 265.1 260.9 322.3 377.8 173.4 224.8 255.3 247.9 47 Trade payables 52.2 94.0 101.6' 86.1' 96.2' 122.6 108.3 -57.4 34.6 -86.8 155.5 98.4 48 Security credit 61.4 -.1 26.7 52.4 111.0 128.0 159.3 134.3 167.0 -27.2 -86.9 89.3 49 Life insurance reserves 37.1 35.5 45.8 44.5 54.3 37.4 49.3 53.3 51.7 59.0 40.8 65.9 50 Pension fund reserves 268.0r 254.7' 235.1' 246.9' 304.0' 304.1 294.7 272.9 279.5 313.8 284.3 316.4 51 Taxes payable 11.4 2.6 6.2 16.0 16.8 3.9 12.2 .9 27.3 11.7 -10.3 27.2 52 Investment in bank personal trusts .9 17.8 4.0 -8.6 75.0 78.4 50.3 57.5 47.8 67.1 64.1 53.0 53 Noncorporate proprietors' equity 24.1 53.6 60.3 -.6' 6.1' -43.5 -11.0 -5.4 -61.2 3.2 -2.5 12.3 54 Miscellaneous 356.0' 245.6' 444.6' 498.31 513.3' 222.2 980.1 376.5 712.6 702.0 238.7 1,092.8 55 Total financial sources 2,337.6r 2,088.3r 2,773.2r 2,975.1r 3,487.1r 3,624.1 4,621.2 3,687.3 3,988.1 3,746.3 4,069.6 3,968.0 Liabilities not identified as assets (—) 56 Treasury currency -.2 -.2 -.5 -.9 -.6 -2.4 -.2 -.3 1.1 -3.4 -1.5 -.4 57 Foreign deposits -5.7 43.0 25.1 59.6 106.8' 145.5 -95.7 119.9 69.9 -156.5 62.0 73.5 58 Net interbank liabilities 4.2 -2.7 -3.1 -3.3 -19.9 -38.1 35.1 8.9 22.3 -52.8 58.7 -1.7 59 Security repurchase agreements 50.5' 67.7' 20.2' 4.5' 62.3' 185.1 120.8 -170.0 110.2 .2 362.2 -14.8 60 Taxes payable 15.8 16.6 21.1 20.4 18.8 14.4 9.4 2.8 24.2 17.4 -22.4 -15.0 61 Miscellaneous -158.5' -160.1' -221.4' -66.9' -254.9' -640.7 61.0 -225.9 -106.7 -43.9 -568.0 -390.0 Floats not included in assets (—) 62 Federal government checkable deposits -1.5 -4.8 -6.0 .5 -2.7 -10.0 8.3 -44.4 32.4 14.0 -1.8 -41.4 63 Other checkable deposits -1.3 -2.8 -3.8 -4.0 -3.9 -5.0 -4.0 -2.9 -3.6 -1.8 -1.9 -1.0 64 Trade credit -4.0 1.5 -11.7 -49.9' 3.6' 15.7 41.9 -150.7 -94.5 -31.1 55.7 -6.9 65 Total identified to sectors as assets 2,438.2r 2,130.1r 2,953.4r 3,015.2r 3,577.6r 3,959.6 4,444.8 4,150.0 3,932.8 4,004.0 4,126.5 4,365.7 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, tables 2. Excludes corporate equities and mutual fund shares. F.l and F.5. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A40 Domestic Nonfinancial Statistics • October 1999 1.59 SUMMARY OF CREDIT MARKET DEBT OUTSTANDING1 Billions of dollars, end of period 1997 1998 1999 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999944 11999955 11999966 11999977 Q4 Qlr Q2 Q3 Q4 Qlr Q2 Nonfinancial sectors 1 Total credit market debt owed by domestic nonfinancial sectors 13,013.9' 13,734.3r 14,477.4r 15,261.1r 15,261.1r 15,522.2 15,742.1r 15,956.2r 16,283.6r 16,588.0 16,758.7 By sector and instrument 2 Federal government 3,492.3 3,636.7 3,781.8 3,804.9 3,804.9 3,830.8 3,749.0 3,720.2 3,752.2 3,759.7 3,651.7 3 Treasury securities 3,465.6 3,608.5 3,755.1 3,778.3 3,778.3 3,804.8 3,723.4 3,694.7 3,723.7 3,731.6 3,623.4 4 Budget agency securities and mortgages 26.7 28.2 26.6 26.5 26.5 25.9 25.6 25.5 28.5 28.1 28.3 5 Nonfederal 9,521.6' 10,097.6' 10,695.6' ll,456.3r 11,456.3' 11,691.4 ll,993.2r 12,236.0' 12,531.4' 12,828.3 13,107.0 By instrument 6 Commercial paper 139.2 157.4 156.4 168.6 168.6 193.1 202.5 216.9 193.0 223.9 232.4 7 Municipal securities and loans 1,341.7 1,293.5 1,296.0 1,367.5 1,367.5 1,397.1 1,429.3 1,439.9 1,464.3 1,491.0 1,510.0 8 Corporate bonds 1,253.0 l,344.1r 1,460.4r 1,610.^ l,610.9r 1,680.6 l,754.3r l,781.3r l,829.6r 1,898.1 1,963.3 y Bank loans n.e.c 759.9 863.6r 934. lr l,040.5r 1,040.5' 1,047.9 l,097.6r 1,120.6' l,148.8r 1,165.2 1,178.4 10 Other loans and advances 669.6 736.9 770.4r 839.5 839.5 863.5 873.lr 886.8r 913.8' 947.5 945.8 11 Mortgages 4,374.2' 4,579.4' 4,866.8r 5,165.2' 5,165.2r 5,273.3 5,379.7' 5,504.0r 5,650.3r 5,784.1 5,939.2 12 Home 3,330.0'' 3,509.8r 3,719. & 3,954.8r 3,954.8r 4,037.9 4,116.4' 4,216.4' 4,321.1r 4,413.8 4,526.0 13 Multifamily residential 261.5 269.1 284.3 295.0r 295.0r 300.4 305.7r 309.7r 317.4' 326.6 335.8 14 Commercial 699.8 716.0 776.4r 825.1' 825.lr 843.6 864.6' 883.61 915.3r 946.3 977.7 15 Farm 83.0 84.6 87.1 90.3 90.3 91.3 93.0r 94.4r 96.5' 97.4 99.7 16 Consumer credit 983.9 1,122.8 1,211.6 1,264.1 1,264.1 1,236.0 1,256.8 1,286.6 1,331.7 1,318.6 1,338.0 By borrowing sector 17 Household 4,427.0' 4,782.2' 5,105.1r 5,433.3r 5,433.3r 5,494.5 5,613.2' 5,746.1r 5,903.6r 5,985.9 6,128.1 18 Nonfinancial business 3,972.9 4,245.2r 4,527. lr 4,903.5r 4,903.5' 5,052.6 5,209.2r 5,311.1' 5,428.0' 5,619.2 5,740.7 19 Corporate 2,708.9 2,947.7r S.Ml.O' 3,433.8' 3,433.8r 3,559.4 3,686.4' 3,762.5r 3,852.2r 4,019.2 4,107.9 20 Nonfarm noncorporate 1,121.8 1,152.4 1,236.1 1,313.6 1,313.6 1,337.9 1,361.8 1,385.5 1,411.9 1,437.6 1,466.7 21 Farm 142.2 145.1 149.9 156.1 156.1 155.3 161.0' 163.1r 163.8r 162.4 166.2 22 State and local government 1,121.7 1,070.2 1,063.4 1,119.5 1,119.5 1,144.3 1,170.8 1,178.8 1,199.8 1,223.2 1,238.2 23 Foreign credit market debt held in United States 370.3r 441.4r 518.7r 570.1r 570.1r 591.6 617.1r 612.8r 603.7r 607.8 596.5 24 Commercial paper 42.7 56.2 67.5 65.1 65.1 76.7 71.4 74.0 72.9 77.2 70.1 25 Bonds 242.3 291.9 347.7 394.9r 394.9r 405.6 435.4r 428.6r 420.0' 420.2 415.4 26 Bank loans n.e.c 26.1 34.6 43.7 52.1 52.1 53.4 55.5 56.4 58.9 59.1 60.5 27 Other loans and advances 59.3'' 58.8r 59.8' 58.0 58.0 55.9 54.8 53.8 52.0 51.3 50.4 28 Total credit market debt owed by nonfinancial sectors, domestic and foreign 13384.2r 14,175.8r 14,996.0r 15,831.2r 15,831.2r 16,113.8 16,359.2r 16,568.9r 16,887.3r 17,195.8 17,355.2 Financial sectors 29 Total credit market debt owed by financial sectors 3,822.2 4,278.8r 4,827.7r 5,446.8r 5,446.8r 5,670.1 5,926.8r 6,195.5r 6,515.6r 6,809.7 7,073.6 By instrument 30 Federal government-related 2,172.7 2,376.8 2,608.3 2,821.1r 2,821.1r 2,878.0 2,981.4r 3,121.7' 3,292.0 3,434.1 3,580.8 31 Government-sponsored enterprise securities 700.6 806.5 896.9 995.3 995.3 1,030.9 1,072.5 1,146.0 1,273.6 1,321.8 1,398.0 32 Mortgage pool securities 1,472.1 1,570.3 1,711.4 1,825.8 1,825.8 1,847.1 l,908.9r 1,975.7' 2,018.4 2,112.3 2,182.8 33 Loans from U.S. government .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 .0 34 Private 1,649.5 l,901.9r 2,219.4' 2,625.7' 2,625.7r 2,792.1 2,945,4r 3,073.8r 3,223.6r 3,375.6 3,492.7 35 Open market paper 441.6 486.9 579.1 745.7 745.7 804.9 838.9 874.2 906.7 926.4 940.9 36 Corporate bonds 1,008.8 1,204.7 1,381.5 1,557.5 1,557.5 1,640.8 1,738.7 1,786.2 1,849.4 1,969.3 2,042.9 37 Bank loans n.e.c 48.9 51.4r 64.0' 77.2' 77.2' 90.6 88.2r 103.2r 107.2r 104.1 106.8 38 Other loans and advances 131.6 135.0 162.9 198.5 198.5 206.6 225.6 246.2 288.7 299.1 328.6 39 Mortgages 18.7 24.1 31.9 46.8 46.8 49.1 54.1 64.0 71.6 76.6 73.6 By borrowing sector 40 Commercial banks 94.5 102.6 113.6 140.6 140.6 148.7 159.6 169.6 188.6 187.5 202.7 41 Bank holding companies 133.6 148.0 150.0 168.6 168.6 181.2 190.5 196.1 193.5 202.6 202.7 42 Savings institutions 112.4 115.0 140.5 160.3 160.3 162.9 170.7 186.6 212.4 226.9 241.6 43 Credit unions .5 .4 .4 .6 .6 .7 .8 1.0 1.1 1.5 1.8 44 Life insurance companies .6 .5 1.6 1.8 1.8 1.8 1.6 2.0 2.5 3.3 4.0 45 Government-sponsored enterprises 700.6 806.5 896.9 995.3 995.3 1,030.9 1,072.5 1,146.0 1,273.6 1,321.8 1,398.0 46 Federally related mortgage pools 1,472.1 1,570.3 1,711.4 1,825.8 1,825.8 1,847.1 l,908.9r l,975.7r 2,018.4 2,112.3 2,182.8 47 Issuers of asset-backed securities (ABSs) 570.1 712.5 866.4 1,078.2 1,078.2 1,142.9 1,230.4 1,307.0 1,394.6 1,463.8 1,542.9 48 Brokers and dealers 34.3 29.3 27.3 35.3 35.3 35.1 40.1 39.4 42.5 34.8 30.2 49 Finance companies 433.7 483.9 529.8 554.5 554.5 571.9 596.9 589.4 597.5 614.4 639.2 50 Mortgage companies 18.7 16.5r 20.6' 16.0r 16.0r 23.4 16.3' 16.9r 17.7r 16.5 17.8 51 Real estate investment trusts (REITs) 40.0 44.6 56.5 96.1 96.1 111.9 128.0 147.8 158.8 165.2 160.3 52 Funding corporations 211.0 248.6 312.7 373.7 373.7 411.6 410.5 417.9 414.4 459.1 449.6 All sectors 53 Total credit market debt, domestic and foreign ... 17,206.4r 18,454.5r 19,823.7r 21,278.1r 21,278.1r 21,783.9 22,286.0r 22,764.5r 23,402.9r 24,005.5 24,428.7 54 Open market paper 623.5 700.4 803.0 979.4 979.4 1,074.8 1,112.7 1,165.1 1,172.6 1,227.6 1,243.3 55 U.S. government securities 5,665.0 6,013.6 6,390.0 6,626.0r 6,626.0' 6,708.7 6,730.3r 6,841.9' 7,044.3' 7,193.8 7,232.5 56 Municipal securities 1,341.7 1,293.5 1,296.0 1,367.5 1,367.5 1,397.1 1,429.3 1,439.9 1,464.3 1,491.0 1,510.0 57 Corporate and foreign bonds 2,504.0 2,840.7' 3,189.6' 3,563.3r 3,563.3r 3,727.0 3,928.3r 3,996.0r 4,098.9' 4,287.6 4,421.6 58 Bank loans n.e.c 834.9 949.6 1,041.7 1,169.8 1,169.8 1,191.9 1,241.3 1,280.3 1,314.9' 1,328.3 1,345.6 59 Other loans and advances 860.5r 930.6r 993.1' 1,095.9 1,095.9 1,126.1 l,153.6r 1,186.8' 1,254.4' 1,297.8 1,324.8 60 Mortgages 4,393.0r 4,603.4r 4,898.7' 5,212.0' 5,212.0r 5,322.4 5,433.7r 5,568.0r 5,721.9r 5,860.7 6,012.7 61 Consumer credit 983.9 1,122.8 1,211.6 1,264.1 1,264.1 1,236.0 1,256.8 1,286.6 1,331.7 1,318.6 1,338.0 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, tables L.2 through L.4. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A3 9 1.60 SUMMARY OF FINANCIAL ASSETS AND LIABILITIES1 Billions of dollars except as noted, end of period 1997 1998 1999 TTrraannssaaccttiioonn ccaatteeggoorryy oorr sseeccttoorr 11999944 11999955 11999966 11999977 Q4 Ql Q2 Q3 Q4' Ql' Q2 CREDIT MARKET DEBT OUTSTANDING2 1 Total credit market assets 17,206.4R 18,454.5R 19,823.7R 21,278.1R 21,278.1R 21,783.9R 22,286.0' 22,764.5R 23,402.9 24,005.5 24,428.7 2 Domestic nonfederal nonfinancial sectors 2,988.8r 2,856.8r 2,924.6r 2,781.4' 2,781.4' 2,761.2' 2,847.0' 2,876.6' 2,813.0 2,875.4 2,915.9 Household l,932.1r l,895.5r 2,011.6r 1,871.1' 1,871.1' 1,868.2' 1,919.2' l,913.4r 1,805.8 1,874.9 1,889.2 4 Nonfinancial corporate business 289.2 280.4 270.2r 268.0' 268.0' 249.6' 238.7' 244.7' 265.4 246.1 257.0 Nonfarm noncorporate business 37.6 42.3 38.0 37.4 37.4 37.4 37.4 37.4 37.4 37.4 37.4 6 State and local governments 729.9 638.6 604.8 605.0 605.0 606.0 651.6' 681.1 704.4 717.1 732.3 7 Federal government 202.9' 202.7* 195.3' 200.4 200.4 204.3 207.5 210.9 213.9 218.3 219.9 8 Rest of the world 1,216.0 1,531.R l,926.6r 2,256.8' 2,256.8' 2,317.1' 2,396.0' 2,412.2' 2,534.3 2,591.8 2,603.3 9 Financial sectors 12,798.8r 13,863.9r 14,777.2r 16,039.5' 16,039.5' 16,501.3' 16,835.5' 17,264.8' 17,841.7 18,320.0 18,689.7 10 Monetary authority 368.2 380.8 393.1 431.4 431.4 433.8 440.3 446.5 452.5 466.0 485.1 11 Commercial banking 3,254.3 3,520.1 3,707.7 4,031.9 4,031.9 4,093.4' 4,136.4 4,195.7 4,335.7 4,338.4 4,383.3 12 U.S.-chartered banks 2,869.6 3,056.1 3,175.8 3,450.7 3,450.7 3,505.1' 3,543.6 3,616.2 3,761.2 3,782.9 3,847.6 13 Foreign banking offices in United States 337.1 412.6 475.8 516.1 516.1 517.9 525.6 510.1 504.2 487.8 465.7 14 Bank holding companies 18.4 18.0 22.0 27.4 27.4 31.2 26.8 28.3 26.5 25.0 25.0 11 Banks in U.S.-affiliated areas 29.2 33.4 34.1 37.8 37.8 39.2 40.4 41.1 43.8 42.7 45.0 16 Savings institutions 920.8 913.3 933.2 928.5 928.5 931.3' 930.8 939.3 964.8 990.8 1,011.4 17 Credit unions 246.8 263.0 288.5 305.3 305.3 306.7 315.1 320.5 324.2 331.0 342.5 18 Bank personal trusts and estates 248.0 239.7 232.0 239.5 239.5 240.1 240.9 241.4 242.4 243.1 243.7 19 Life insurance companies 1,487.5 1,587.5 1,657.0 1,751.3 1,751.3 1,777.3 1,793.2 1,810.6 1,828.0 1,853.7 1,876.0 ?0 Other insurance companies 446.4 468.7 491.2 515.3 515.3 521.1 520.8 518.9 535.7 530.8 532.1 21 Private pension funds 660.9 716.9 769.2 834.7 834.7 853.4 885.9 909.8 953.4 968.5 1,006.0 72 State and local government retirement funds 497.4r 531.0' 568.2r 632.0' 632.0' 648.9' 668.5' 684.9' 697.0 715.6 724.9 73 Money market mutual funds 459.0 545.5 634.3 721.9 721.9 775.0 815.9 869.9 965.9 1,036.2 1,001.8 *>4 718.8 771.3 820.2 901.1 901.1 940.0 979.1 1,005.9 1,025.9 1,050.5 1,078.1 ?5 Closed-end funds 86.0 96.4 101.1 98.3' 98.3' 99.4' 100.5' 101.7' 102.8 103.9 105.0 76 Government-sponsored enterprises 663.3 750.0 807.9 902.2 902.2 951.4 989.4 1,055.4 1,163.0 1,201.9 1,267.1 27 Federally related mortgage pools 1,472.1 1,570.3 1,711.4 1,825.8 1,825.8 1,847.1' 1,908.9' 1,975.7' 2,018.4 2,112.3 2,182.8 ?8 Asset-backed securities issuers (ABSs) 532.8 653.4 777.0 939.3 939.3 989.2' 1,068.9 1,134.2 1,216.0 1,280.8 1,355.7 29 Finance companies 476.2 526.2 544.5 566.4 566.4 572.0 579.0 592.7 618.4 639.9 660.9 30 Mortgage companies 36.5 33.0 41.2 32.1 32.1 46.8 32.7 33.8 35.3 33.0 35.6 31 Real estate investment trusts (REITs) 24.6 26.0 30.4 50.6 50.6 57.0 58.5 55.7 45.5 45.9 45.3 32 Brokers and dealers 93.3 183.4 167.7 182.6 182.6 244.0 198.3 217.5 165.2 211.4 160.2 33 Funding corporations 106.0r 87.4r 101.4r 149.4' 149.4' 173.5' 172.6' 155.1' 151.7 166.4 192.2 RELATION OF LIABILITIES TO FINANCIAL ASSETS 34 Total credit market debt 17,206.4R 18,454.5R 19,823.7R 21,278.1R 21,278.1R 21,783.9R 22,286.0R 22,764.5R 23,402.9 24,005.5 24,428.7 Other liabilities 35 Official foreign exchange 53.2 63.7 53.7 48.9 48.9 48.2 50.1 54.5 60.1 53.6 5500..99 36 Special drawing rights certificates 8.0 10.2 9.7 9.2 9.2 9.2 9.2 9.2 9.2 8.2 8.2 37 Treasury currency 17.6 18.2 18.3 18.3 18.3 18.4 18.4 18.8 18.3 18.3 18.5 38 Foreign deposits 373.9 418.8 516.1 618.8' 618.8' 607.2' 630.4 651.7' 639.9 671.8 700.4 39 Net interbank liabilities 280.1 290.7 240.8 219.4 219.4 179.6' 189.1' 198.7' 187.7 180.5 196.4 40 Checkable deposits and currency 1,242.0 1,229.3 1,245.1 1,286.6 1,286.6 1,259.2' 1,320.7' 1,282.3' 1,334.2 1,311.5 1,354.3 41 Small time and savings deposits 2,183.2 2,279.7 2,377.0 2,474.1 2,474.1 2,525.4' 2,531.0' 2,553.8' 2,626.5 2,638.6 2,646.6 4? Large time deposits 411.2 476.9 590.9 713.4 713.4 760.9 754.0 776.5 805.5 804.3 809.0 43 Money market fund shares 602.9 745.3 891.1 1,048.7 1,048.7 1,130.7 1,153.7 1,249.7 1,334.2 1,416.0 1,398.1 44 Security repurchase agreements 549.5 660.0 701.5 822.4 822.4 889.3' 861.5 918.9' 875.0 980.3 961.4 45 Mutual fund shares 1,477.3 1,852.8 2,342.4 2,989.4 2,989.4 3,339.3 3,438.4 3,137.3 3,610.5 3,760.8 4,029.9 46 Security credit 279.0 305.7 358.1 469.1 469.1 505.3 540.6 579.0 577.4 552.7 576.7 47 Life insurance reserves 520.3 566.2 610.6 665.0 665.0 677.3 690.6 703.5 718.3 730.9 747.4 48 Pension fund reserves 4,948. lr 5,767.8r 6,642.5' 7,894.4' 7,894.4' 8,583.1' 8,730.8' 8,194.6' 9,160.7 9,335.8 9,770.1 49 Trade payables 1,140.6 l,242.3r 1,328.4' 1,424.6' 1,424.6' 1,419.2' 1,405.0' 1,418.3' 1,424.3 1,430.4 1,454.6 50 Taxes payable 101.4 107.6 123.6 140.4 140.4 151.7' 144.4' 154.7' 153.4 159.6 158.4 51 Investment in bank personal trusts 699.4 803.0 871.7 1,082.8 1,082.8 1,179.5 1,204.9 1,118.9 1,274.2 1,317.0 1,402.7 52 Miscellaneous 5,287.2r 5,634.7r 6,098.8' 6,663.5' 6,663.5' 6,737.3' 6,807.2' 7,024.1' 7,094.4 7,087.4 7,184.8 53 Total liabilities 37,381.6r 40,927.2r 44,843.8' 49,867.0r 49,867.0r 51,804.7r 52,765.9R 52,809.1r 55,306.8 56,463.3 57,897.0 Financial assets not included in liabilities (+) 54 Gold and special drawing rights 21.1 22.1 21.4 21.1 21.1 21.2 21.0 21.2 21.6 20.7 20.8 55 Corporate equities 6,237.9 8,331.3 10,062.4 12,776.0 12,776.0 14,397.6 14,556.1 12,758.4 15,437.7 15,970.3 17,137.5 56 Household equity in noncorporate business 3,410.5 3,658.3 3,864.5' 4,213.4' 4,213.4' 4,039.4' 4,255.1' 4,265.5' 4,288.4 4,293.4 4,257.7 Liabilities not identified as assets (—) 57 Treasury currency -5.4 -5.8 -6.7 -7.3 -7.3 -7.4 -7.4 -7.2 -8.0 -8.4 -8.5 58 Foreign deposits 325.4 360.2 431.4 534.0' 534.0' 510.1' 540.1' 557.6' 539.7 555.1 573.5 59 Net interbank transactions -6.5 -9.0 -10.6 -32.2 -32.2 -21.2 -17.1 -15.4 -27.0 -11.3 -10.5 60 Security repurchase agreements 66.2r 86.4r 90.9' 153.1' 153.1' 187.4' 140.9' 175.2' 168.4 263.0 255.6 61 48.8 62.4 76.7 93.5 93.5 89.6' 95.6' 101.9' 103.9 90.6 108.2 62 Miscellaneous -948. lr — l,350.8r -1,714.9' -2,087.0' -2,087.0' -2,259.2' -2,311.2' -2,449.9' -2,719.9 -2,953.5 -2,998.9 Floats not included in assets (—) 63 Federal government checkable deposits 3.4 3.1 -1.6 -8.1 -8.1 -10.4 -16.1 -12.0 -3.9 -7.2 -12.4 64 Other checkable deposits 38.0 34.2 30.1 26.2 26.2 21.4 24.2 15.7 23.1 18.9 22.1 65 Trade credit -245.9 -257.5r -307.7' -314.5' -314.5' -358.1' -412.2' -440.1' -373.7 -415.3 -432.3 66 Total identified to sectors as assets 47,775.0R 54,015.9R 60,204.6R 68,519.7R 68,519.7R 72,110.7R 73,561.4R 71,928.4R 77,351.9 79,215.7 81,816.2 1. Data in this table also appear in the Board's Z.l (780) quarterly statistical release, tables 2. Excludes corporate equities and mutual fund shares. L.l and L.5. For ordering address, see inside front cover. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A42 Domestic Nonfinancial Statistics • October 1999 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures Monthly data seasonally adjusted, and indexes 1992=100, except as noted 1998 1999 MMeeaassuurree 11999966 11999977 11999988 Nov. Dec. Jan. Feb. Mar. Apr.r Mayr June July 1 Industrial production' 119.5 126.8 131.3 132.2 132.3 132.3 132.5 133.3 133.7 134.0 134.2 135.1 Market groupings 2 Products, total 114.4 119.6 123.5 124.5 124.4 124.5 124.6 125.2r 125.6 125.8 125.7 126.2 3 Final, total 115.5 121.1 125.4 126.1 125.9 125.8 125.9 126.5 126.8 127.2 127.0 127.5 4 Consumer goods 111.3 114.1 115.2 114.8 114.9 115.2 115.3 115.3r 115.5 115.7 115.9 115.9 Equipment 122.7 133.9 144.2 146.5 145.6 145.0 145.1 146.7r 147.2 147.9 147.1 148.3 6 Intermediate 110.9 115.2 118.0 119.3 119.8 120.3 120.4 121.0r 121.5 121.6 121.3 122.2 7 Materials 127.8 138.2 144.0 144.6 145.2 144.9 145.3 146.7r 146.9 147.3 148.2 149.9 Industry groupings 8 Manufacturing 121.4 129.7 135.1 136.4 136.7 136.4 136.9 137.5 138.0 138.4 138.6 113399..44 9 Capacity utilization, manufacturing (percent)2. . 81.4 82.0 80.8 80.1 80.0 79.5 79.5 79.5 79.6 79.5 79.4 79.7 10 Construction contracts' 130.9r - 142.9r 156.3r 164.0r 167.0r 172.0r 164.0r 161.0r 166.0 166.0 166.0 158.0 11 Nonagricultural employment, total4 117.3 120.3 123.4 124.4 124.8 124.9 125.3 125.4 125.7 125.7 126.0 126.3 12 Goods-producing, total 2.4 2.4 2.3 102.5 102.8 102.6 102.7 102.5 102.5 102.1 102.1 102.3 13 Manufacturing, total 97.4 98.2 98.5 98.1 98.0 97.8 97.6 97.4 97.2 97.0 96.8 97.0 14 Manufacturing, production workers 98.6 99.6 99.6 98.9 98.8 98.6 98.3 98.2 98.0 97.8 97.5 97.8 15 Service-producing 123.1 126.5 130.1 131.4 131.8 132.1 132.5 132.7 133.1 133.2 133.6 133.9 16 Personal income, total 165.2 174.5 183.3 187.2 187.1 188.2 189.1 189.6 190.5 191.1 192.5 193.0 17 Wages and salary disbursements 159.8 171.2 182.6 186.7 187.6 189.0 190.2 190.6 191.7 192.6 193.6 195.0 18 Manufacturing 135.7 144.7 151.1 151.6 151.7 152.4 152.8 152.9 153.5 154.4 155.1 156.4 19 Disposable personal income5 164.0 171.7 178.6 182.4 182.1 183.2 183.9 184.6 185.4 185.8 187.1 187.4 20 Retail sales5 162.5r 170.1r 178.5r 182.9r 184.7r 186.8r 190.0r 189.8r 190.9 192.8 192.5 193.9 Prices6 21 Consumer (1982-84=100) 156.9 160.5 163.0 164.0 163.9 164.3 164.5 165.0 166.2 166.2 166.2 166.7 22 Producer finished goods (1982=100) 131.3 131.8 130.7 130.9 131.1 131.4 130.8r 131.lr 131.8 132.4 132.7 132.9 1. Data in this table appear in the Board's G.17 (419) monthly statistical release. The data 3. Index of dollar value of total construction contracts, including residential, nonresidenare also available on the Board's web site, http://www.federalreserve.gov/releases/gl7. The tial, and heavy engineering, from McGraw-Hill Information Systems Company, F.W. Dodge latest historical revision of the industrial production index and the capacity utilization rates Division. was released in November 1998. The recent annual revision is described in an article in the 4. Based on data from the U.S. Department of Labor, Employment and Earnings. Series January 1999 issue of the Bulletin. For a description of the methods of estimating industrial covers employees only, excluding personnel in the armed forces. production and capacity utilization, see "Industrial Production and Capacity Utilization: 5. Based on data from U.S. Department of Commerce, Survey of Current Business. Historical Revision and Recent Developments," Federal Reserve Bulletin, vol. 83 (February 6. Based on data not seasonally adjusted. Seasonally adjusted data for changes in the price 1997), pp. 67-92, and the references cited therein. For details about the construction of indexes can be obtained from the U.S. Department of Labor, Bureau of Labor Statistics, individual industrial production series, see "Industrial Production: 1989 Developments and Monthly Labor Review. Historical Revision," Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204. NOTE. Basic data (not indexes) for series mentioned in notes 4 and 5, and indexes for series 2. Ratio of index of production to index of capacity. Based on data from the Federal mentioned in notes 3 and 6, can also be found in the Survey of Current Business. Reserve, DRI McGraw-Hill, U.S. Department of Commerce, and other sources. 2.11 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data seasonally adjusted 1998 1999 CCaatteeggoorryy 11999966 11999977 11999988 Dec. Jan. Feb. Mar. Apr.r Mayr June July HOUSEHOLD SURVEY DATA1 1 Civilian labor force2 133,943 136,297 137,673 138,547 139,347 139,271 138,816 139,091 139,019 139,408 139,254 Employment 2 Nonagricultural industries3 123,264 126,159 128,085 129,304 130,097 129,817 129,752 129,685 129,929 130,078 130,015 3 Agriculture 3,443 3,399 3,378 3,222 3,299 3,328 3,281 3,384 3,295 3,354 3,292 Unemployment 4 Number 7,236 6,739 6,210 6,021 5,950 6,127 5,783 6,022 5,795 5,975 5,947 5 Rate (percent of civilian labor force) 5.4 4.9 4.5 4.3 4.3 4.4 4.2 4.3 4.2 4.3 4.3 ESTABLISHMENT SURVEY DATA 6 Nonagricultural payroll employment4 119,608 122,690 125,833 127,186 127,378 127,730 127,813 128,134 128,162 128,435 128,745 7 Manufacturing 18,495 18,657 18,716 18,611 18,585 18,538 18,503 18,473 18,429 18,393 18,424 8 Mining 580 592 575 570 560 553 550 538 531 527 524 9 Contract construction 5,418 5,686 5,965 6,173 6,170 6,238 6,232 6,277 6,239 6,260 6,282 10 Transportation and public utilities 6,253 6,395 6,551 6,684 6,708 6,723 6,732 6,750 6,758 6,778 6,792 11 Trade 28,079 28,659 29,299 29,426 29,480 29,585 29,558 29,689 29,725 29,781 29,888 17, Finance 6,911 7,091 7,341 7,542 7,570 7,581 7,595 7,611 7,621 7,639 7,652 13 Service 34,454 36,040 37,525 38,207 38,313 38,458 38,556 38,697 38,782 38,946 39,056 14 Government 19,419 19,570 19,862 19,973 19,992 20,054 20,087 20,099 20,077 20,111 20,127 1. Beginning January 1994, reflects redesign of current population survey and population 4. Includes all full- and part-time employees who worked during, or received pay for, the controls from the 1990 census. pay period that includes the twelfth day of the month; excludes proprietors, self-employed 2. Persons sixteen years of age and older, including Resident Armed Forces. Monthly persons, household and unpaid family workers, and members of the armed forces. Data are figures are based on sample data collected during the calendar week that contains the twelfth adjusted to the March 1992 benchmark, and only seasonally adjusted data are available at this day; annual data are averages of monthly figures. By definition, seasonality does not exist in time. 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

Selected Measures A43 2.12 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION1 Seasonally adjusted 1998 1999 1998 1999 1998 1999 SSeerriieess Q3 Q4 Qlr Q2 Q3 Q4 Ql Q2 Q3 Q4 Qlr Q2 Output (1992=100) Capacity (percent of 1992 output) Capacity utilization rate (percent)2 1 Total industry 131.6 132.3 132.7 134.0 161.5 163.5 165.2 166.7 81.5 80.9 80.3 80.4 2 Manufacturing 134.8 136.4 136.9 138.3 168.1 170.3 172.3 174.0 80.2 80.1 79.5 79.5 3 Primary processing3 120.2 120.6 121.7 121.8 145.1 146.1 146.9 147.7 82.9 82.5 82.8 82.5 4 Advanced processing4 142.1 144.4 144.6 146.6 179.2 182.0 184.5 186.7 79.3 79.3 78.3 78.5 5 Durable goods 157.9 161.2 162.1 164.8 197.5 201.2 204.4 207.4 79.9 80.1 79.3 79.5 6 Lumber and products 117.7 119.2 121.6 121.4 143.9 144.9 146.0 147.1 81.8 82.3 83.3 82.5 7 Primary metals 122.4 119.3 120.4 123.0 143.2 144.4 145.4 145.9 85.5 82.6 82.8 84.3 8 Iron and steel 118.7 112.9 115.5 120.3 144.6 146.5 147.9 148.8 82.1 77.0 78.1 80.8 9 Nonferrous 126.8 126.9 126.3 126.3 141.3 141.7 142.1 142.4 89.7 89.6 88.9 88.7 10 Industrial machinery and equipment 207.9 211.7 214.6 219.5 242.9 251.6 259.8 266.9 85.6 84.1 82.6 82.2 11 Electrical machinery 292.7 304.8 310.3 327.4 381.6 396.6 411.0 424.9 76.7 76.9 75.5 77.0 12 Motor vehicles and parts 137.2 148.5 147.5 151.2 184.9 186.0 186.7 187.1 74.2 79.8 79.0 80.8 13 Aerospace and miscellaneous transportation equipment 106.6 105.8 103.1 99.8 128.0 128.5 128.8 128.7 83.3 82.4 80.1 77.5 14 Nondurable goods 111.3 111.4 111.6 111.7 137.5 138.4 139.1 139.6 80.9 80.5 80.2 80.0 15 Textile mill products 112.1 110.2 109.7 111.1 135.1 135.2 135.0 134.7 83.0 81.5 81.2 82.5 16 Paper and products 115.0 114.3 116.3 114.6 132.5 133.4 134.2 135.0 86.8 85.7 86.7 84.9 17 Chemicals and products 114.4 114.0 114.0 115.6 148.9 149.7 150.3 150.8 76.8 76.1 75.8 76.7 18 Plastics materials 128.4 131.9 129.6 131.1 141.9 143.2 144.4 145.6 90.5 92.1 89.8 90.0 19 Petroleum products 112.7 111.9 115.4 112.9 116.8 117.1 117.4 117.7 96.5 95.6 98.3 95.9 70 Mining 103.6 100.7 98.8 98.3 120.1 120.6 120.9 121.2 86.2 83.5 81.7 81.1 71 Utilities 119.6 112.9 114.3 115.7 126.5 126.7 126.9 127.1 94.6 89.2 90.0 91.0 22 Electric 121.2 116.7 116.4 118.0 124.0 124.3 124.5 124.7 97.7 93.9 93.5 94.7 1973 1975 Previous cycle5 Latest cycle6 1998 1999 High Low High Low High Low July Feb. Mar. Apr.r Mayr June1 July? Capacity utilization rate (percent)2 1 Total industry 89.2 72.6 87.3 71.1 85.4 78.1 81.1 80.2 80.5 80.4 80.4 80.3 80.7 2 Manufacturing 88.5 70.5 86.9 69.0 85.7 76.6 79.8 79.5 79.5 79.6 79.5 79.4 79.7 3 Primary processing3 91.2 68.2 88.1 66.2 88.9 77.7 83.4 82.7 82.7 82.5 82.4 82.5 83.0 4 Advanced processing4 87.2 71.8 86.7 70.4 84.2 76.1 78.5 78.4 78.4r 78.6 78.6 78.4 78.6 5 Durable goods 89.2 68.9 87.7 63.9 84.6 73.1 78.6 79.1 79.4r 79.5 79.5 79.4 79.7 6 Lumber and products 88.7 61.2 87.9 60.8 93.6 75.5 81.8 83.6 82.5r 82.1 83.4 82.1 82.1 7 Primary metals 100.2 65.9 94.2 45.1 92.7 73.7 85.9 81.5 83.8r 83.9 83.9 85.0 85.4 8 Iron and steel 105.8 66.6 95.8 37.0 95.2 71.8 83.5 76.1 79.0r 80.0 80.2 82.3 82.8 9 Nonferrous 90.8 59.8 91.1 60.1 89.3 74.2 88.9 88.4 89.9 88.9 88.8 88.5 88.8 10 Industrial machinery and equipment 96.0 74.3 93.2 64.0 85.4 72.3 87.0 82.3 83.0r 82.9 82.2 81.5 81.8 11 Electrical machinery 89.2 64.7 89.4 71.6 84.0 75.0 76.8 75.2 75.3r 76.7 77.2 77.3 78.7 12 Motor vehicles and parts 93.4 51.3 95.0 45.5 89.1 55.9 58.3 79.2 79.8r 79.9 80.5 82.0 80.3 13 Aerospace and miscellaneous transportation equipment 78.4 67.6 81.9 66.6 87.3 79.2 83.8 80.6 79.5r 78.5 77.4 76.6 76.5 14 Nondurable goods 87.8 71.7 87.5 76.4 87.3 80.7 81.7 80.4 80.2r 80.2 80.0 79.9 80.1 15 Textile mill products 91.4 60.0 91.2 72.3 90.4 77.7 83.9 81.9 80.8r 82.6 82.3 82.5 83.0 16 Paper and products 97.1 69.2 96.1 80.6 93.5 85.0 87.7 86.7 86.6 85.1 84.6 85.0 84.2 17 Chemicals and products 87.6 69.7 84.6 69.9 86.2 79.3 77.9 76.1 76.5r 76.4 76.6 77.1 77.3 18 Plastics materials 102.0 50.6 90.9 63.4 97.0 74.8 91.6 91.7 89.4 90.0 90.4 89.7 88.8 19 Petroleum products 96.7 81.1 90.0 66.8 88.5 85.1 97.2 99.1 96.2r 97.2 96.0 94.4 97.1 20 Mining 94.3 88.2 96.0 80.3 88.0 87.0 87.2 81.8 81.8r 81.1 81.2 81.1 81.6 21 Utilities 96.2 82.9 89.1 75.9 92.6 83.4 93.7 87.7 91.9r 91.1 90.8 91.1 93.3 22 Electric 99.0 82.7 88.2 78.9 95.0 87.1 96.7 91.6 95.4 94.9 94.5 94.6 97.6 1. Data in this table appear in the Board's G.17 (419) monthly statistical release. The data 3. Primary processing includes textiles; lumber; paper; industrial chemicals; synthetic are also available on the Board's web site, http://www.federalreserve.gov/releases/gl7. The materials; fertilizer materials; petroleum products; rubber and plastics; stone, clay, and glass; latest historical revision of the industrial production index and the capacity utilization rates primary metals; and fabricated metals. was released in November 1998. The recent annual revision is described in an article in the 4. Advanced processing includes foods; tobacco; apparel; furniture and fixtures; printing January 1999 issue of the Bulletin. For a description of the methods of estimating industrial and publishing; chemical products such as drugs and toiletries; agricultural chemicals; leather production and capacity utilization, see "Industrial Production and Capacity Utilization: and products; machinery; transportation equipment; instruments; and miscellaneous manufac- Historical Revision and Recent Developments," Federal Reserve Bulletin, vol. 83 (February tures. 1997), pp. 67-92, and the references cited therein. For details about the construction of 5. Monthly highs, 1978-80; monthly lows, 1982. individual industrial production series, see "Industrial Production: 1989 Developments and 6. Monthly highs, 1988-89; monthly lows, 1990-91. Historical Revision," Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204. 2. Capacity utilization is calculated as the ratio of the Federal Reserve's seasonally adjusted index of industrial production to the corresponding index of capacity. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A44 Domestic Nonfinancial Statistics • October 1999 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value1 Monthly data seasonally adjusted 1992 1998 1999 GGrroouupp 1998 por- avg. tion July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr.r Mayr Juner JJuullyypp Index (1992 = 100) MAJOR MARKETS 1 Total index 100.0 131.3 130.5 132.4 131.9 132.4 132.2 132.3 132.3 132.5 133.3 133.7 134.0 134.2 135.1 2 Products 60.5 123.5 123.3 124.9 124.1 124.9 124.5 124.4 124.5 124.6 125.2 125.6 125.8 125.7 126.2 3 Final products 46.3 125.4 124.7 126.8 126.0 126.7 126.1 125.9 125.8 125.9 126.5 126.8 127.2 127.0 127.5 4 Consumer goods, total 29.1 115.2 114.0 116.1 114.8 115.2 114.8 114.9 115.2 115.3 115.3 115.5 115.7 115.9 115.9 5 Durable consumer goods 6.1 135.7 124.6 140.1 137.4 140.5 138.9 139.8 141.5 143.3 142.2 144.9 146.6 147.7 146.1 6 Automotive products 2.6 132.9 107.3 141.7 136.4 141.1 139.6 139.8 141.7 140.4 138.4 140.9 144.6 147.0 140.6 7 Autos and trucks 1.7 137.8 92.8 151.4 143.4 150.6 149.1 147.7 149.4 149.3 147.5 150.1 154.2 158.9 146.7 8 Autos, consumer .9 109.2 75.8 124.4 128.3 119.9 113.7 115.5 111.7 109.0 110.8 112.8 108.8 112.4 107.2 9 Trucks, consumer .7 166.2 110.0 178.9 161.1 181.0 183.2 179.1 185.2 187.2 182.5 185.7 196.4 202.2 184.0 10 Auto parts and allied goods .... .9 125.0 125.6 127.6 125.9 127.4 125.9 128.2 130.5 127.5 125.3 127.7 130.7 130.0 131.1 11 Other 3.5 137.8 138.7 138.5 138.0 139.7 137.9 139.5 141.0 145.4 145.0 147.9 148.0 148.0 150.4 12 Appliances, televisions, and air conditioners 1.0 206.2 207.8 209.4 209.9 215.2 222.5 226.0 229.6 241.4 241.7 251.5 248.4 251.8 262.7 13 Carpeting and furniture .8 117.1 117.3 116.7 116.3 120.3 117.5 116.8 120.7 123.1 117.8 119.0 120.3 120.3 121.6 14 Miscellaneous home goods 1.6 114.7 115.9 115.3 114.5 113.6 109.5 111.4 110.9 113.5 115.5 116.7 117.3 116.2 116.4 15 Nondurable consumer goods 23.0 110.1 111.2 110.3 109.3 109.1 109.0 108.9 108.9 108.6 108.8 108.5 108.3 108.3 108.7 16 Foods and tobacco 10.3 109.0 108.5 107.5 106.9 108.0 109.6 109.6 110.0 110.2 109.6 109.0 108.6 108.3 108.2 17 Clothing 2.4 97.8 98.4 97.7 97.1 95.4 94.5 94.6 93.4 92.6 92.3 92.9 91.2 91.2 90.4 18 Chemical products 4.5 120.5 122.2 119.0 118.0 117.2 119.3 118.7 115.3 117.4 117.3 116.8 117.6 117.8 119.0 19 Paper products 2.9 105.8 106.3 106.6 105.9 105.2 104.1 103.6 102.0 101.0 99.5 100.4 101.0 101.7 101.2 20 Energy 2.9 112.2 118.4 120.1 116.8 115.0 106.5 107.1 113.3 108.9 115.3 114.0 113.5 113.0 116.2 21 Fuels .8 110.5 112.9 112.1 108.3 108.4 109.1 109.6 112.2 113.3 110.5 112.0 111.5 109.3 113.1 22 Residential utilities 2.1 112.3 120.7 123.7 120.7 117.8 104.5 105.2 113.3 106.0 117.2 114.4 114.0 114.4 117.3 23 Equipment 17.2 144.2 143.9 146.0 146.2 147.5 146.5 145.6 145.0 145.1 146.7 147.2 147.9 147.1 148.3 24 Business equipment 13.2 163.5 163.5 166.6 167.4 169.0 168.1 167.9 167.3 167.6 169.3 170.6 171.3 170.5 171.9 25 Information processing and related 5.4 209.9 211.8 213.1 217.3 219.0 219.7 220.8 222.0 222.1 226.6 232.6 239.9 241.0 246.1 26 Computer and office equipment 1.1 646.0 654.6 671.6 693.6 716.7 745.2 759.9 777.0 787.2 824.8 852.8 875.9 898.6 921.1 27 Industrial 4.0 140.0 144.2 142.3 139.5 141.6 139.9 141.3 139.9 137.9 138.5 139.4 137.1 136.2 137.2 28 Transit 2.5 133.7 121.9 141.6 140.1 141.6 140.5 139.6 137.6 137.7 137.2 137.3 135.0 133.9 133.7 29 Autos and trucks 1.2 124.6 91.7 136.9 135.6 136.1 136.4 136.0 134.8 133.2 135.0 137.9 138.1 140.6 142.4 30 Other 1.3 138.9 146.6 132.6 140.9 141.1 138.5 131.7 131.5 140.2 142.8 135.7 135.0 130.5 127.4 31 Defense and space equipment 3.3 75.7 76.1 76.5 75.5 76.4 75.7 74.6 74.4 74.8 74.9 74.5 74.8 74.0 74.2 32 Oil and gas well drilling .6 134.7 131.9 127.7 123.4 119.4 115.2 103.2 99.2 97.4 104.2 97.2 100.3 100.4 102.0 33 Manufactured homes .2 149.2 151.1 145.7 147.8 150.9 154.6 156.6 159.1 154.1 152.8 148.0 145.2 142.8 141.8 34 Intermediate products, total 14.2 118.0 119.1 119.1 118.3 119.0 119.3 119.8 120.3 120.4 121.0 121.5 121.6 121.3 122.2 35 Construction supplies 5.3 127.2 128.5 128.0 126.9 128.4 129.6 131.0 132.4 132.7 131.7 132.0 132.7 131.9 133.1 36 Business supplies 8.9 112.6 113.6 113.8 113.3 113.5 113.2 113.3 113.1 113.1 114.7 115.2 115.0 115.1 115.7 37 Materials 39.5 144.0 141.9 144.4 144.4 144.5 144.6 145.2 144.9 145.3 146.7 146.9 147.3 148.2 149.9 38 Durable goods materials 20.8 176.4 171.8 177.4 177.7 178.8 179.9 180.4 180.1 180.0 182.6 183.3 184.0 185.4 187.9 39 Durable consumer parts 4.0 144.0 129.7 149.6 147.7 146.2 145.6 144.8 141.9 145.4 147.7 145.7 145.2 147.0 148.7 40 Equipment parts 7.6 277.4 274.1 278.0 282.7 287.0 289.9 292.6 293.2 292.5 297.0 302.5 306.7 310.3 316.1 41 Other 9.2 129.0 128.1 128.3 127.7 128.4 129.3 129.3 129.8 128.6 130.2 130.0 129.7 129.9 131.2 42 Basic metal materials 3.1 121.2 120.2 121.9 118.2 118.3 117.3 116.3 118.4 116.1 118.4 119.2 118.3 119.0 119.5 43 Nondurable goods materials 8.9 113.5 114.1 113.1 112.0 111.7 112.2 112.5 112.0 113.2 113.0 112.7 113.0 113.4 113.3 44 Textile materials 1.1 108.7 110.1 107.7 107.6 108.8 103.0 102.5 99.0 101.1 101.8 103.1 102.5 102.2 103.2 45 Paper materials 1.8 116.0 117.3 116.4 115.0 115.8 112.7 114.7 116.5 116.0 116.9 116.3 114.6 116.9 115.0 46 Chemical materials 3.9 114.5 114.6 113.6 111.8 111.1 113.7 113.0 112.8 114.0 113.7 113.7 114.5 115.1 115.1 47 Other 2.1 111.5 111.7 111.6 111.5 110.4 113.2 114.4 112.5 114.8 113.1 112.0 113.6 112.1 113.0 48 Energy materials 9.7 103.5 104.8 104.4 105.2 103.7 101.5 102.6 102.6 102.6 103.4 103.4 103.1 103.6 105.6 49 Primary energy 6.3 101.2 102.9 101.2 102.3 102.6 99.8 100.3 100.4 101.2 100.4 98.7 99.3 99.1 100.9 50 Converted fuel materials 3.3 108.1 108.6 110.7 110.9 106.1 104.9 107.2 107.1 105.6 109.2 112.4 110.5 112.4 114.6 SPECIAL AGGREGATES 51 Total excluding autos and trucks 97.1 131.3 131.6 132.1 131.7 132.1 131.9 132.1 132.0 132.3 133.2 133.4 133.7 133.8 134.9 52 Total excluding motor vehicles and parts 95.1 130.8 131.7 131.3 131.0 131.5 131.4 131.7 131.7 131.7 132.6 132.9 133.2 133.3 134.4 53 Total excluding computer and office equipment 98.2 127.1 126.2 128.0 127.4 127.8 127.4 127.5 127.4 127.6 128.2 128.4 128.6 128.7 129.6 54 Consumer goods excluding autos and trucks . 27.4 113.9 114.9 114.3 113.2 113.4 113.0 113.2 113.4 113.5 113.6 113.7 113.7 113.6 114.3 55 Consumer goods excluding energy 26.2 115.5 113.5 115.7 114.6 115.3 115.8 115.8 115.4 116.0 115.3 115.7 116.0 116.2 115.9 56 Business equipment excluding autos and trucks 12.0 167.9 171.8 169.9 171.0 172.7 171.6 171.5 170.9 171.5 173.1 174.3 175.0 173.9 175.2 57 Business equipment excluding computer and office equipment 12.1 142.4 142.2 144.8 145.1 146.2 144.6 144.1 143.1 143.2 144.0 144.7 144.9 143.6 144.6 58 Materials excluding energy 29.8 156.7 153.6 156.9 156.7 157.3 158.2 158.6 158.2 158.6 160.2 160.6 161.2 162.2 163.8 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A45 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value1—Continued 1992 1998 1999 GGrroouupp c S o I d C e p p r o o r - - 1 a 9 v 9 g 8 . tion July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr/ Mayr Juner Julyp Index (1992 = 100) MAJOR INDUSTRIES 59 Total index 100.0 131.3 130.5 132.4 131.9 132.4 132.2 132.3 132.3 132.5 133.3 133.7 134.0 134.2 135.1 60 Manufacturing 85.4 135.1 133.6 135.7 135.2 136.1 136.4 136.7 136.4 136.9 137.5 138.0 138.4 138.6 139.4 61 Primary processing 26.5 120.7 120.7 120.6 119.3 120.1 120.3 121.3 121.8 121.6 121.7 121.7 121.7 122.0 122.9 62 Advanced processing 58.8 142.1 139.9 143.3 143.2 144.2 144.6 144.4 143.8 144.6 145.4 146.2 146.8 146.9 147.7 63 Durable goods 45.0 157.5 154.4 159.8 159.6 161.2 161.0 161.5 161.4 161.7 163.1 164.1 165.0 165.4 166.6 64 Lumber and products " ' 24 2.0 117.0 117.5 118.5 117.0 118.0 118.3 121.4 122.0 122.1 120.7 120.4 122.7 121.1 121.4 65 Furniture and fixtures 25 1.4 121.4 120.8 120.1 121.6 124.5 123.6 122.9 122.5 124.5 126.1 123.6 125.0 124.7 125.9 66 SSttoonnee,, ccllaayy,, aanndd ggllaassss pprroodduuccttss 32 2.1 126.2 125.4 127.0 126.6 128.3 130.5 131.6 133.5 132.2 131.1 128.8 128.4 128.3 129.6 67 Primary metals 33 3.1 123.8 122.6 124.4 120.1 120.6 118.7 118.6 120.7 118.5 122.0 122.4 122.5 124.2 124.9 68 Iron and steel 331,2 1.7 121.1 120.2 122.5 113.4 114.4 109.7 114.6 116.7 112.6 117.1 118.9 119.3 122.7 123.5 69 Raw steel 331PT .1 115.7 118.3 120.3 112.6 109.7 100.2 102.0 106.6 106.6 109.1 110.5 113.4 110.9 114.9 70 Nonferrous 333-6,9 1.4 127.0 125.4 126.7 128.1 128.0 129.3 123.4 125.4 125.6 127.9 126.6 126.4 126.0 126.6 71 Fabricated metal products . . 34 5.0 127.3 127.8 126.3 126.2 126.9 127.7 128.7 127.6 126.7 127.5 127.6 126.6 127.5 128.9 72 Industrial machinery and equipment 35 8.0 203.7 209.0 207.0 207.7 211.2 211.1 212.7 212.3 213.9 217.6 219.5 219.6 219.4 221.7 73 Computer and office equipment 357 1.8 649.1 657.0 673.6 695.5 718.5 746.9 761.6 778.9 789.3 828.3 859.3 883.8 907.2 929.9 74 Electrical machinery 36 7.3 291.9 289.4 290.8 297.7 302.4 304.8 307.3 308.7 309.2 313.1 322.2 328.1 331.9 341.2 75 Transportation equipment.. . 37 9.5 123.0 108.2 130.3 127.6 128.4 127.1 125.6 124.0 125.6 125.5 124.9 124.7 125.5 123.9 76 Motor vehicles and parts . 371 4.9 141.1 107.6 154.2 149.9 150.2 148.8 146.6 145.3 147.9 149.2 149.4 150.7 153.5 150.4 77 Autos and light trucks . 371PT 2.6 128.5 86.9 142.0 136.5 140.4 138.1 137.3 137.9 137.3 136.3 138.7 141.1 145.4 135.0 78 Aerospace and miscellaneous transportation equipment 372-6,9 4.6 104.9 107.1 106.9 105.8 106.9 105.7 104.8 103.2 103.7 102.4 101.1 99.7 98.5 98.3 79 Instruments 38 5.4 113.0 112.6 113.0 114.2 114.6 114.1 113.9 114.3 113.8 114.6 115.6 117.5 115.7 116.6 80 Miscellaneous 39 1.3 117.7 118.5 117.7 117.0 115.9 114.1 115.4 114.8 115.8 116.7 118.2 119.4 118.4 118.4 81 Nondurable goods 40.4 111.9 112.1 111.3 110.6 110.9 111.6 111.7 111.3 111.9 111.7 111.8 111.7 111.7 112.1 82 Foods 20 9.4 109.6 109.0 107.9 107.7 109.1 111.3 111.1 112.0 112.3 111.4 111.4 110.9 110.6 110.4 83 Tobacco products 21 1.6 106.0 106.0 107.0 104.2 101.9 99.8 100.0 96.9 97.4 97.3 96.0 97.2 96.3 97.0 84 Textile mill products 22 1.8 112.2 113.2 111.8 111.2 112.4 108.8 109.4 109.3 110.6 109.0 111.4 110.8 111.1 111.6 85 Apparel products 23 2.2 99.2 100.1 99.2 98.3 97.3 95.5 95.3 94.1 93.6 93.3 94.0 92.8 92.4 93.0 86 Paper and products 26 3.6 115.0 115.9 115.3 113.9 115.4 112.3 115.3 116.2 116.4 116.5 114.6 114.2 115.0 114.1 87 Printing and publishing .... 27 6.7 105.1 105.4 104.9 104.6 104.2 105.4 105.1 103.6 103.8 103.7 104.3 104.1 104.0 104.1 88 Chemicals and products .... 28 9.9 115.5 115.7 114.3 113.3 113.1 114.7 114.0 112.5 114.4 115.1 115.1 115.5 116.3 116.8 89 Petroleum products 29 1.4 112.0 113.4 114.1 110.7 110.4 112.8 112.5 116.7 116.4 113.1 114.3 113.0 111.2 114.5 90 Rubber and plastic products . 30 3.5 132.6 132.7 132.2 132.6 133.4 135.0 136.0 135.4 135.2 135.4 136.2 137.4 136.6 138.7 91 Leather and products 31 .3 75.3 75.3 74.0 73.5 72.8 74.3 73.0 70.9 70.5 70.7 70.3 70.6 70.4 68.8 92 Mining 6.9 104.0 104.6 103.7 102.4 102.0 101.1 99.0 98.5 98.9 98.9 98.3 98.4 98.3 99.0 93 Metal 10 .5 110.0 105.7 109.0 106.4 113.6 110.7 108.3 110.1 108.4 104.1 105.2 98.8 93.5 93.1 94 Coal 12 1.0 109.7 112.8 109.7 115.8 110.8 108.6 114.5 107.7 109.1 103.4 106.8 106.1 106.5 109.6 95 Oil and gas extraction 13 4.8 99.6 100.0 99.2 96.8 96.8 94.2 91.0 91.5 91.7 93.3 91.8 92.4 92.7 93.2 96 Stone and earth minerals 14 .6 124.7 125.4 124.3 120.3 118.8 132.1 125.6 126.9 127.7 129.1 126.7 128.7 128.9 129.1 97 Utilities 7.7 113.9 118.3 120.2 120.3 116.5 110.6 111.8 114.7 111.3 116.7 115.8 115.4 115.8 118.7 98 Electric 491.493PT 6.2 117.2 119.8 121.2 122.6 120.3 114.6 115.2 116.2 114.1 118.9 118.2 117.8 118.0 121.8 99 Gas 492,493PT 1.6 101.9 111.7 115.7 109.7 98.7 92.0 96.0 108.4 98.6 106.9 104.5 104.3 105.7 104.2 SPECIAL AGGREGATES 100 Manufacturing excluding motor vehicles and parts 80.5 134.7 135.1 134.6 134.4 135.3 135.7 136.2 136.0 136.3 136.8 137.4 137.7 113377..77 113388..88 101 Manufacturing excluding computer and office equipment 83.6 130.2 128.6 130.6 130.0 130.8 130.9 131.1 130.8 131.2 131.5 131.9 132.1 113322..22 113322..99 102 Computers, communications equipment, and semiconductors 5.9 515.6 511.8 522.5 538.3 552.1 562.8 571.2 576.6 580.0 597.8 620.1 640.2 655.0 673.2 103 Manufacturing excluding computers and semiconductors 81.1 120.1 118.9 120.6 119.9 120.4 120.4 120.5 120.1 120.5 120.7 120.8 120.8 120.7 112211..33 104 Manufacturing excluding computers, communications equipment, and semiconductors 79.5 118.5 117.2 119.0 118.1 118.7 118.8 118.9 118.5 118.9 119.0 119.0 118.9 118.8 119.2 Gross value (billions of 1992 dollars, annual rates) Major Markets 105 Products, total 2,001.9 2,489.8 2,454.6 2,525.1 2,501.0 2,519.7 2,511.6 2,513.9 2,527.3 2,527.2 2,536.0 2,547.5 2,550.4 2,549.6 2,559.6 106 Final 1,552.1 1,958.0 1,915.6 1,985.9 1,966.4 1,982.3 1,973.4 1,972.7 1,982.5 1,982.7 1,989.4 1,997.8 2,000.1 2,001.1 2,006.5 107 Consumer goods 1,049.6 1,212.3 1,185.0 1,227.4 1,208.2 1,217.1 1,212.6 1,215.0 1,227.4 1,227.0 1,226.3 1,230.6 1,231.2 1,234.5 1,234.4 108 Equipment 502.5 746.9 734.3 762.5 762.7 769.8 765.2 762.0 758.8 759.5 767.3 771.5 773.3 770.8 776.7 109 Intermediate 449.9 533.6 538.4 540.3 535.7 538.7 539.1 541.9 545.4 545.1 547.1 550.2 550.8 549.2 553.5 1. Data in this table appear in the Board's G.17 (419) monthly statistical release. The data Historical Revision and Recent Developments," Federal Reserve Bulletin, vol. 83 (February are also available on the Board's web site, http://www.federalreserve.gov/releases/gl7. The 1997), pp. 67-92, and the references cited therein. For details about the construction of latest historical revision of the industrial production index and the capacity utilization rates individual industrial production series, see "Industrial Production: 1989 Developments and was released in November 1998. The recent annual revision is described in an article in the Historical Revision," Federal Reserve Bulletin, vol. 76 (April 1990), pp. 187-204. January 1999 issue of the Bulletin. For a description of the methods of estimating industrial 2. Standard industrial classification. production and capacity utilization, see "Industrial Production and Capacity Utilization: Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • October 1999 2.14 HOUSING AND CONSTRUCTION Monthly figures at seasonally adjusted annual rates except as noted 1998 1999 item 11999966 11999977 11999988 Sept. Oct. Nov. Dec. Jan. Feb. Mar.' Apr.' May June Private residential real estate activity (thousands of units except as noted) NEW UNITS 1 Permits authorized 1,426 1,441 1,604 1,569 1,726 1,688 1,708 1,778 1,738 1,654 1,572 1,591 1,641 2 One-family 1,070 1,062 1,184 1,171 1,210 1,254 1,296 1,279' 1,306 1,242 1,214 1,243 1,241 3 Two-family or more 356 379 421 398 516 434 412 499' 432 412 358 348 400 4 Started 1,477 1,474 1,617 1,576 1,698 1,654 1,750 1,820 1,752 1,746 1,577 1,668 1,571 5 One-family 1,161 1,134 1,271 1,251 1,298 1,375 1,383 1,393 1,380 1,394 1,260 1,389 1,272 6 / Un T de w r o c - o fa n m str i u ly c ti o o r n m at o e r n e d of period1 3 8 1 1 6 9 3 8 4 3 0 4 3 93 4 5 6 9 3 4 2 6 5 4 96 0 8 0 2 97 7 1 9 9 3 9 6 9 7 1, 4 0 2 1 7 1 1, 3 0 7 3 2 2 1, 3 0 5 3 2 6 1, 3 0 1 3 7 1 1, 2 0 7 2 9 6 1, 2 0 9 1 9 5 8 One-family 584 570 638 648 659 667 688 697 712 714 708 706 699 9 Two-family or more 235 264 297 298 309 304 311 314 320 322 323 320 316 10 Completed 1,406 1,406 1,473 1,459 1,455 1,600 1,440 1,648 1,528 1,700 1,633 1,660 1,692 11 One-family 1,123 1,120 1,158 1,184 1,164 1,254 1,150 1,292 1,246 1,357 1,324 1,344 1,369 12 Two-family or more 283 285 315 275 291 346 290 356 282 343 309 316 323 13 Mobile homes shipped 361 354 372 369 352 389 382 390 381 383 368 365 355 Merchant builder activity in one-family units 1 1 4 5 N N u u m m b b e e r r f s o o r ld s ale at end of penod1 7 3 5 2 7 6 2 8 8 0 7 4 3 8 0 8 0 6 8 2 6 8 1 9 9 2 0 9 3 3 9 2 8 9 5 2 9 2 5 9 8 5 9 2 0 9 8 5 9 29 0 7 9 3 8 0 8 0 5 9 3 5 0 2 0 9 3 1 0 2 5 9 3 7 0 9 7 Price of units sold (thousands of dollars)2 16 Median 140.0 146.0 152.5 155.0 154.5 151.0 152.5 152.5 159.9 155.0 160.0 151.2 155.0 17 Average 166.4 176.2 181.9 182.7 182.8 178.6 183.3 182.8 191.4 189.4 191.4 186.4 190.7 EXISTING UNITS (one-family) 18 Number sold 4,196 4,381 4,970 4,960 4,940 5,020 5,340 5,060 5,140 5,420 5,250 5,000 5,630 Price of units sold (thousands of dollars)2 19 Median 115.8 121.8 128.4 129.4 128.1 129.4 128.5 130.3 128.1 129.6 130.7 132.8 136.9 20 Average 141.8 150.5 159.1 158.9 157.7 159.9 159.6 162.8 159.6 162.3 163.8 167.4 174.2 Value of new construction (millions of dollars)3 CONSTRUCTION 21 Total put in place 581,920r 617,877r 664,451r 672,053r 674,253r 680,117r 690,462r 697,858r 710,657r 715,396 705,492 695,895 699,396 22 Private 447,593R 474,842R 518,987R 524,270R 528,694' 534,743' 541,591R 543,471' 548,682' 555,362 549,005 546,794 549,989 23 Residential 255,577R 265,908' 293,569R 299,752' 302,056' 306,299R 310,261' 315,828' 318,483' 323,133 322,297 322,772 322,014 24 Nonresidential 192,017R 208,933R 225,418R 224,518R 226,638R 228,444R 231,330' 227,643' 230,199' 232,229 226,708 224,022 227,975 25 Industrial buildings 32,644R 31,355R 32,308R 32,423R 30,928R 30,845R 30,327' 29,895' 28,967' 29,052 26,298 25,455 25,804 26 Commercial buildings 75,829R 86,190R 95,252R 93,286R 97,705R 99,83 lr 101,605' 100,164' 102,802' 103,983 102,318 102,372 102,881 27 Other buildings 30,648R 37,198R 39,438R 39,017' 38,749R 39,744R 42,354' 38,833' 40,449' 39,840 39,718 38,497 38,589 28 Public utilities and other 52,896R 54,190R 58,42 lr 59,792' 59,256R 58,024' 57,044' 58,751' 57,981' 59,354 58,374 57,698 60,701 29 Public 134,326R 143,035R 145,464' 147,783' 145,559' 145,374' 148,871' 115544,,338877'' 161,975' 160,033 156,487 149,101 149,407 30 Military 2,604R 2,559R 2,588R 2,103R 2,407R 2,296R 2,306' 11,,888811'' 2,636' 2,223 2,290 2,155 2,168 31 Highway 39,883R 44,295R 45,067R 45,057R 46,30 lr 43,929R 44,583' 50,538' 54,880' 53,099 50,586 47,033 43,634 32 Conservation and development 5,827R 5,576R 5,487' 5,920^ 5,321R 5,639' 5,406' 6,018' 6,271' 6,194 6,020 5,188 6,018 33 Other 86,012R 90,605R 92,322R 94,703R 91,530R 93,510' 96,576' 95,950' 98,188' 98,517 97,591 94,725 97,587 1. Not at annual rates. SOURCE. Bureau of the Census estimates for all series except (1) mobile homes, which are 2. Not seasonally adjusted. private, domestic shipments as reported by the Manufactured Housing Institute and season- 3. Recent data on value of new construction may not be strictly comparable with data for ally adjusted by the Census Bureau, and (2) sales and prices of existing units, which are previous periods because of changes by the Bureau of the Census in its estimating techniques. published by the National Association of Realtors. All back and current figures are available For a description of these changes, see Construction Reports (C-30-76-5), issued by the from the originating agency. Permit authorizations are those reported to the Census Bureau Census Bureau in July 1976. from 19,000 jurisdictions beginning in 1994. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A47 2.15 CONSUMER AND PRODUCER PRICES Percentage changes based on seasonally adjusted data except as noted Change from 12 Change from 3 months earlier Change from 1 month earlier months earlier (annual rate) Index level, Item 1998 1999 1999 July 1998 1999 1999 1 July July Sept. Dec. Mar. June Mar. Apr. May June July CONSUMER PRICES2 (1982-84=100) 1 1.7 2.1 1.5 2.0 1.5 2.9 .2 .7 .0 .0 .3 166.7 Food 2.2 2.1 2.5 2.8 1.7 1.7 -.2 .1 .4 .0 .2 163.8 -5.6 3.3 -9.0 -5.1 5.8 14.2 11..66 6.1 -1.3 -1.2 2.1 108.7 4 2.2 2.1 2.3 2.5 .9 2.3 ..11 .4 .1 .1 .2 176.9 .6 .6 1.1 2.5 -3.0 2.0 -.3 .6 -.1 .0 .1 143.2 33..00 22..77 33..00 2.5 22..77 2.5 .3 .4 .2 .1 .3 196.1 PRODUCER PRICES (1982=100) 7 -.2 1.5 .6 2.2 ,6r 2.5 ,3r .5 .2 -.1 .2 132.9 8 .5 -.3 1.8 .3 2.1 .3 ,3r -.9 .5 .4 -.9 134.3 C> -7.5 4.9 -9.2 -8.9 5.7r 21.9 1.7r 5.3r .0 -.3 3.4 80.7 in 2.1 2.3 3.0 8.3 - 1.3r .3 -.R ,2r .0 -.1 .1 150.8 1111 --..55 -.1 .9 .3 -,6r .0 -.R .R .2 -.3 -.1 137.0 Intermediate materials P -1.4 .4 -2.2 -4.5 ,3r 5.7 .3 ,8r .2 .4 .6 124.4 1133 --..44 -.1 -1.8 -2.7 -.9 3.1 ,I .2 .2 .5 .4 133.4 Crude materials 14 -7.4 -7.5 -19.6 -7.0 4.1 .0 -,7r -2.5 2.2 .4 -4.8 95.9 15 -10.4 12.1 -25.3 13.5 -2i.R 158.3 2.9r 9.9r 11.9 3.1 3.7 79.5 1166 Other -7.6 --66..66 --1199..99 -24.3 .9r 7.3 -i.R -1.0r 2.3 .5 2.3 134.3 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 rental-equivalence measure of homeownership. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 Domestic Nonfinancial Statistics • October 1999 2.16 GROSS DOMESTIC PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates 1998 1999 AAccccoouunntt 11999966 11999977 11999988 Q2 Q3 Q4 Q1 Q2 GROSS DOMESTIC PRODUCT 1 Total 7,661.6 8,110.9 8,511.0 8,440.6 8,537.9 8,681.2 8,808.7 8,881.9 By source 2 Personal consumption expenditures 5,215.7 5,493.7 5,807.9 5,773.7 5,846.7 5,934.8 6,050.6 6,155.9 3 Durable goods 643.3 673.0 724.7 720.1 718.9 754.5 771.2 784.6 4 Nondurable goods 1,539.2 1,600.6 1,662.4 1,655.2 1,670.0 1,691.3 1,736.0 1,771.1 5 Services 3,033.2 3,220.1 3,420.8 3,398.4 3,457.7 3,488.9 3,543.4 3,600.1 6 Gross private domestic investment 1,131.9 1,256.0 1,367.1 1,345.0 1,364.4 1,392.4 1,417.4 1,423.2 / Fixed investment 1,099.8 1,188.6 1,307.8 1,305.8 1,307.5 1,346.7 1,377.9 1,410.9 8 Nonresidential 787.9 860.7 938.2 941.9 931.6 957.9 972.6 995.1 y Structures 216.9 240.2 246.9 245.4 246.2 250.9 255.0 256.0 10 Producers' durable equipment 571.0 620.5 691.3 696.6 685.4 706.9 717.6 739.1 it Residential structures 311.8 327.9 369.6 363.8 375.8 388.9 405.3 415.8 12 Change in business inventories 32.1 67.4 59.3 39.2 57.0 45.7 39.5 12.4 13 Nonfarm 24.5 63.1 52.7 31.5 49.3 39.3 36.4 9.9 14 Net exports of goods and services -91.2 -93.4 -151.2 -159.3 -165.5 -156.2 -196.9 -240.0 15 Exports 873.8 965.4 959.0 949.6 936.2 976.8 962.7 972.6 16 Imports 965.0 1,058.8 1,110.2 1,108.9 1,101.7 1,133.0 1,159.6 1,212.7 17 Government consumption expenditures and gross investment 1,405.2 1,454.6 1,487.1 1,481.2 1,492.3 1,510.2 1,537.5 1,542.8 18 Federal 518.4 520.2 520.6 520.7 519.4 530.7 536.6 533.0 iy State and local 886.8 934.4 966.5 960.4 972.9 979.5 1,000.9 1,009.8 By major type of product 20 Final sales, total 7,629.5 8,043.5 8,451.6 8,401.3 8,480.9 8,635.5 8,769.1 8,869.6 21 Goods 2,780.3 2,911.2 3,044.7 3,025.3 3,029.0 3,118.8 3,154.1 3,189.0 22 Durable 1,228.8 1,310.1 1,391.0 1,380.8 1,373.0 1,433.1 1,436.1 1,449.6 23 Nondurable 1,551.6 1,601.0 1,653.7 1,644.4 1,655.9 1,685.7 1,718.1 1,739.4 24 Services 4,179.5 4,414.1 4,641.0 4,619.5 4,678.5 4,727.7 4,793.7 4,853.8 25 Structures 669.7 718.3 765.9 756.6 773.5 789.0 821.3 826.8 26 Change in business inventories 32.1 67.4 59.3 39.2 57.0 45.7 39.5 12.4 21 Durable goods 20.8 33.6 25.2 4.5 19.5 27.0 16.5 -2.4 28 Nondurable goods 11.4 33.8 34.1 34.7 37.5 18.7 23.1 14.7 MEMO 29 Total GDP in chained 1992 dollars 6,994.8 7,269.8 7,551.9 7,498.6 7,566.5 7,677.7 7,759.6 7,794.3 NATIONAL INCOME 30 Total 6,256.0 6,646.5 6,994.7 6,945.5 7,032.3 7,126.0 7,265.2 7,346.6 31 Compensation of employees 4,409.0 4,687.2 4.981.0 4,945.2 5,011.6 5,084.3 5,166.5 5,237.0 32 Wages and salaries 3,640.4 3,893.6 4,153.9 4,121.6 4,181.1 4,246.8 4,317.0 4,378.1 33 Government and government enterprises 640.9 664.2 689.3 685.8 692.7 699.2 711.2 716.2 34 Other 2,999.5 3,229.4 3,464.6 3,435.8 3,488.4 3,547.6 3,605.7 3,661.9 35 Supplement to wages and salaries 768.6 793.7 827.1 823.5 830.5 837.5 849.6 858.9 36 Employer contributions for social insurance 381.7 400.7 420.1 417.9 422.1 426.5 434.9 439.3 37 Other labor income 387.0 392.9 406.9 405.7 408.4 411.0 414.7 419.6 38 Proprietors' income1 527.7 551.2 577.2 571.7 576.1 596.9 598.3 610.4 39 Business and professional1 488.8 515.8 548.5 544.0 550.9 562.2 575.8 586.7 40 Farm1 38.9 35.5 28.7 27.7 25.2 34.7 22.5 23.7 41 Rental income of persons2 150.2 158.2 162.6 161.0 163.6 167.5 167.7 170.4 42 Corporate profits1 750.4 817.9 824.6 820.6 827.0 821.7 868.8 859.6 43 Profits before tax3 680.2 734.4 717.8 723.5 720.5 708.1 752.6 768.2 44 Inventory valuation adjustment -1.2 6.9 14.5 7.8 11.7 13.4 11.6 -17.1 45 Capital consumption adjustment 71.4 76.6 92.3 89.4 94.8 100.2 104.6 108.6 46 Net interest 418.6 432.0 449.3 447.1 454.0 455.6 463.9 469.2 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. U.S. Department of Commerce, Survey of Current Business. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Selected Measures A49 2.17 PERSONAL INCOME AND SAVING Billions of current dollars except as noted; quarterly data at seasonally adjusted annual rates 1998 1999 AAccccoouunntt 11999966 11999977 11999988 Q2 Q3 Q4 QL Q2 PERSONAL INCOME AND SAVING 1 Total personal income 6,425.2 6,784.0 7,126.1 7,081.9 7,160.8 7,257.9 7,349.3 7,442.3 2 Wage and salary disbursements 3,631.1 3,889.8 4,149.9 4,117.6 4,177.1 4,242.8 4,317.0 4,378.1 3 Commodity-producing industries 909.0 975.0 1,026.9 1,023.2 1,028.0 1,037.4 1,048.1 1,060.6 4 Manufacturing 674.6 719.5 751.5 750.8 750.9 754.1 759.2 767.4 Distributive industries 823.3 879.8 939.6 932.2 945.8 961.5 971.4 982.3 6 Service industries 1,257.9 1,370.8 1,494.0 1,476.4 1,510.6 1,544.6 1,586.2 1,619.0 7 Government and government enterprises 640.9 664.2 689.3 685.8 692.7 699.2 711.2 716.2 8 Other labor income 387.0 392.9 406.9 405.7 408.4 411.0 414.7 419.6 9 Proprietors' income1 527.7 551.2 577.2 571.7 576.1 596.9 598.3 610.4 M Business and professional1 488.8 515.8 548.5 544.0 550.9 562.2 575.8 586.7 11 Farm1 38.9 35.5 28.7 27.7 25.2 34.7 22.5 23.7 17 Rental income of persons2 150.2 158.2 162.6 161.0 163.6 167.5 167.7 170.4 13 Dividends 248.2 260.3 263.1 262.1 263.0 265.7 268.8 272.7 14 Personal interest income 719.4 747.3 764.8 763.0 769.2 769.9 771.0 777.8 15 Transfer payments 1,068.0 1,110.4 1,149.0 1,145.8 1,152.9 1,158.3 1,175.2 1,181.3 16 Old age survivors, disability, and health insurance benefits 538.0 565.9 586.5 585.0 589.0 590.6 597.9 601.4 17 LESS: Personal contributions for social insurance 306.3 326.2 347.4 345.1 349.5 354.1 363.4 367.9 18 EQUALS: Personal income 6,425.2 6,784.0 7,126.1 7,081.9 7,160.8 7,257.9 7,349.3 7,442.3 19 LESS: Personal tax and nontax payments 890.5 989.0 1,098.3 1,092.9 1,108.4 1,124.9 1,144.1 1,162.6 20 EQUALS: Disposable personal income 5,534.7 5,795.1 6,027.9 5,988.9 6,052.4 6,133.1 6,205.2 6,279.6 21 LESS: Personal outlays 5,376.2 5,674.1 6,000.2 5,963.3 6,039.8 6,133.6 6,250.7 6,358.8 22 EQUALS: Personal saving 158.5 121.0 27.7 25.6 12.6 -.6 -45.5 -79.1 MEMO Per capita (chained 1992 dollars) 73 Gross domestic product 26,335.7 27,136.2 27,938.9 27,783.0 27,972.1 28,299.8 2288,,552277..99 2288,,558822..00 24 Personal consumption expenditures 17,893.0 18,340.9 19,065.0 19,007.8 19,156.3 19,336.4 19,602.7 19,771.9 25 Disposable personal income 18,989.0 19,349.0 19,790.0 19,719.0 19,829.0 19,980.0 20,101.0 20,172.0 26 Saving rate (percent) 2.9 2.1 .5 .4 .2 .0 -.7 -1.3 GROSS SAVING 27 Gross saving 1,274.5 1,406.3 1,468.0 1,448.5 1,474.5 1,466.6 1,511.4 1,487.2 28 Gross private saving 1,114.5 1,141.6 1,090.4 1,079.0 1,078.7 1,073.7 1,061.9 1,017.9 ?9 Personal saving 158.5 121.0 27.7 25.6 12.6 -.6 -45.5 -79.1 30 Undistributed corporate profits1 262.4 296.7 305.4 300.9 304.8 303.9 332.5 312.4 31 Corporate inventory valuation adjustment -1.2 6.9 14.5 7.8 11.7 13.4 11.6 -17.1 Capital consumption allowances 3? Corporate 452.0 477.3 500.6 497.8 503.1 508.9 551144..99 552211..88 33 Noncorporate 232.3 242.8 252.7 250.7 254.2 257.5 260.0 262.8 .34 Gross government saving 160.0 264.7 377.6 369.4 395.7 392.9 449.4 469.3 35 Federal -39.6 49.5 142.5 143.9 161.6 135.8 192.3 210.2 36 Consumption of fixed capital 70.6 70.6 69.7 69.5 69.6 70.0 69.5 69.4 37 Current surplus or deficit (—), national accounts -110.3 -21.1 72.8 74.4 92.0 65.8 122.7 140.8 38 State and local 199.7 215.2 235.2 225.6 234.2 257.1 257.2 259.1 39 Consumption of fixed capital 77.1 81.1 85.0 84.3 85.4 86.6 87.5 89.0 40 Current surplus or deficit (—), national accounts 122.6 134.1 150.2 141.3 148.7 170.5 169.7 170.2 41 Gross investment 1,242.3 1,350.5 1,391.5 1,362.7 1,372.5 1,402.4 1,418.3 1,366.7 42 Gross private domestic investment 1,131.9 1,256.0 1,367.1 1,345.0 1,364.4 1,392.4 1,417.4 1,423.2 43 Gross government investment 229.7 235.4 237.0 232.5 239.7 238.3 255.6 249.6 44 Net foreign investment -119.2 -140.9 -212.6 -214.8 -231.6 -228.3 -254.7 -306.2 45 Statistical discrepancy -32.2 -55.8 -76.5 -85.7 -102.0 -64.2 -93.1 -120.5 1. With inventory valuation and capital consumption adjustments. SOURCE. US. 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

A50 International Statistics • October 1999 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data seasonally adjusted except as noted1 1998 1999 IItteemm ccrreeddiittss oorr ddeebbiittss 11999966 11999977 11999988 Ql Q2 Q3 Q4 Ql 1 Balance on current account -129,295 -143,465 -220,562 -43,018 -52,400 -63,476 -61,669 -68,583 2 Balance on goods and services -104,318 -104,730 -164,282 -33,338 -41,961 -45,724 -43,262 -53,761 3 Exports 849,806 938,543 933,907 235,831 231,889 229,284 236,904 232,095 4 Imports -954,124 -1,043,273 -1,098,189 -269,169 -273,850 -275,008 -280,166 -285,856 5 Income, net 17,210 3,231 -12,205 247 -553 -6,965 -4,933 -4,724 6 Investment, net 21,754 8,185 -6,956 1,518 735 -5,637 -3,571 -3,330 7 Direct 67,746 69,220 59,405 16,837 16,177 11,834 14,558 14,524 8 Portfolio -45,992 -61,035 -66,361 -15,319 -15,442 -17,471 -18,129 -17,854 9 Compensation of employees -4,544 -4,954 -5,249 -1,271 -1,288 -1,328 -1,362 -1,394 10 Unilateral current transfers, net -42,187 -41,966 -44,075 -9,927 -9,886 -10,787 -13,474 -10,098 11 Change in U.S. government assets other than official reserve assets, net (increase, —) -989 68 -429 -81 -483 185 -50 147 12 Change in U.S. official reserve assets (increase, —) 6,668 -1,010 -6,784 -444 -1,945 -2,026 -2,369 4,068 13 Gold 0 0 0 0 0 0 0 0 14 Special drawing rights (SDRs) 370 -350 -149 -182 72 188 -227 563 15 Reserve position in International Monetary Fund -1,280 -3,575 -5,118 -85 -1,031 -2,078 -1,924 3 16 Foreign currencies 7,578 2,915 -1,517 -177 -986 -136 -218 3,502 17 Change in U.S. private assets abroad (increase, -) -386,441 -464,354 -285,605 -59,074 -118,089 -60,256 -48,188 5,012 18 Bank-reported claims3 -91,555 -144,822 -24,918 -1,062 -27,704 -33,344 37,192 35,226 19 Nonbank-reported claims -86,333 -120,403 -25,041 -6,596 -14,327 -20,320 16,202 -405 20 U.S. purchases of foreign securities, net -115,859 -89,174 -102,817 -14,116 -32,886 14,994 -70,809 8,488 21 U.S. direct investments abroad, net -92,694 -109,955 -132,829 -37,300 -43,172 -21,586 -30,773 -38,297 22 Change in foreign official assets in United States (increase, +) 127,390 18,119 -21,684 11,004 -10,551 -46,489 24,352 8,568 23 U.S. Treasury securities 115,671 -6,690 -9,957 11,336 -20,318 -32,811 31,836 3,416 24 Other U.S. government obligations 5,008 4,529 6,332 2,610 254 1,906 1,562 5,993 25 Other U.S. government liabilities3 -316 -1,798 -3,113 -1,028 -807 -224 -1,054 -1,605 26 Other U.S. liabilities reported by U.S. banks3 5,704 22,286 -11,469 -958 9,488 -12,866 -7,133 666 27 Other foreign official assets4 1,323 -208 -3,477 -956 832 -2,494 -859 98 28 Change in foreign private assets in United States (increase, +) 447,457 733,542 524,321 85,813 173,017 140,036 125,453 66,302 29 U.S. bank-reported liabilities2 16,478 149,026 40,731 -48,909 34,138 77,313 -21,811 -14,545 30 U.S. nonbank-reported liabilities 39,404 107,779 9,412 32,707 18,040 11,875 -53,210 11,205 31 Foreign private purchases of U.S. Treasury securities, net 154,996 146,433 46,155 -2,557 25,759 -1,438 24,391 -11,434 32 U.S. currency flows 17,362 24,782 16,622 746 2,349 7,277 6,250 2,440 33 Foreign purchases of other U.S. securities, net 130,240 196,258 218,026 76,810 71,785 20,103 49,328 59,507 34 Foreign direct investments in United States, net 88,977 109,264 193,375 27,016 20,946 24,906 120,505 19,129 35 Capital account transactions, net5 672 292 617 143 160 148 166 170 36 Discrepancy -65,462 -143,192 10,126 5,657 10,291 31,878 -37,695 -15,684 37 Due to seasonal adjustment 5,915 528 -10,582 4,144 5,717 38 Before seasonal adjustment -65,462 -143,192 10,126 -258 9,763 42,460 -41,839 -21,401 MEMO Changes in official assets 39 U.S. official reserve assets (increase, —) 6,668 -1,010 -6,784 -444 -1,945 -2,026 --22,,336699 44,,006688 40 Foreign official assets in United States, excluding line 25 (increase, +) 127,706 19,917 -18,571 12,032 -9,744 -46,265 25,406 10,173 41 Change in Organization of Petroleum Exporting Countries official assets in United States (part of line 22) 14,911 12,124 -11,499 -1,257 -657 -11,642 2,057 4,730 1. Seasonal factors are not calculated for lines 11-16, 18-20, 22-35, and 38—41. corporations and state and local governments. 2. Reporting banks included all types of depository institutions as well as some brokers 5. Consists of capital transfers (such as those of accompanying migrants entering or and dealers. leaving the country and debt forgiveness) and the acquisition and disposal of nonproduced 3. Associated primarily with military sales contracts and other transactions arranged with nonfinancial assets. or through foreign official agencies. SOURCE. U.S. Department of Commerce, Bureau of Economic Analysis, Survey of Current 4. Consists of investments in U.S. corporate stocks and in debt securities of private Business. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Summary Statistics A51 3.11 U.S. FOREIGN TRADE1 Millions of dollars; monthly data seasonally adjusted 1998 1999 IItteemm 11999966 11999977 11999988 Dec. Jan. Feb. Mar. Apr.r Mayr Junep 1 Goods and services, balance -104,318 -104,731 -164,282 -14,241 -16,269 -18,543 -18,947 -18,591 -21,169 -24,622 2 Merchandise -191,270 -196,652 -246,932 -21,059 -23,349 -25,172 -25,680 -25,334 -27,899 -31,413 3 Services 86,952 91,921 82,650 6,818 7,080 6,629 6,733 6,743 6,730 6,791 4 Goods and services, exports 849,806 938,543 933,907 78,161 77,903 77,139 77,054 78,224 77,955 78,370 5 Merchandise 612,057 679,715 670,246 56,005 55,263 54,704 54,326 55,269 55,121 55,284 6 Services 237,749 258,828 263,661 22,156 22,640 22,435 22,728 22,955 22,834 23,086 7 Goods and services, imports -954,124 -1,043,273 -1,098,189 -92,402 -94,172 -95,682 -96,001 -96,815 -99,124 -102,992 8 Merchandise -803,327 -876,366 -917,178 -77,064 -78,612 -79,876 -80,006 -80,603 -83,020 -86,697 9 Services -150,797 -166,907 -181,011 -15,338 -15,560 -15,806 -15,995 -16,212 -16,104 -16,295 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 1999 AAsssseett 11999966 11999977 11999988 Jan. Feb. Mar. Apr. May June July Aug.P 1 Total 75,090 69,954 81,755 80,675 75,322 74,359 73,694 72,121 71,689 73,305 72,651 2 Gold stock, including Exchange Stabilization Fund1 11,049 11,050 11,041 11,046 11,048 11,049 11,049 11,049 11,046 11,048 11,048 3 Special drawing rights2,3 10,312 10,027 10,603 10,465 9,474 9,682 9,634 9,784 9,719 9,925 10,152 4 Reserve position in International Monetary Fund2 15,435 18,071 24,111 24,129 24,283 23,231 23,054 21,689 21,462 21,462 19,885 5 Foreign currencies4 38,294 30,809 36,001 35,035 30,517 30,397 29,957 29,599 29,462 30,870 31,566 1. Gold held "under earmark" at Federal Reserve Banks for foreign and international SDR holdings and reserve positions in the IMF also have been valued on this basis since July accounts is not included in the gold stock of the United States; see table 3.13, line 3. Gold 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 year 2. Special drawing rights (SDRs) are valued according to a technique adopted by the indicated, as follows: 1970—$867 million; 1971—$717 million; 1972—$710 million; 1979— International Monetary Fund (IMF) in July 1974. Values are based on a weighted average of $1,139 million; 1980—$1,152 million; 1981—$1,093 million; plus net transactions in SDRs. exchange rates for the currencies of member countries. From July 1974 through December 4. Valued at current market exchange rates. 1980, sixteen currencies were used; since January 1981, five currencies have been used. U.S. 3.13 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS1 Millions of dollars, end of period 1999 AAsssseett 11999966 11999977 11999988 Jan. Feb. Mar. Apr. May June July Aug.? 1 Deposits 167 457 167 233 200 166 260 157 409 257 166 Held in custody 2 U.S. Treasury securities2 638,049 620,885 607,574 612,670 615,139 610,649 606,662 606,579 611,372 619,004 626,669 3 Earmarked gold3 11,197 10,763 10,343 10,343 10,347 10,347 10,340 10,340 10,329 10,329 10,271 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; not organizations. 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

A52 International Statistics • October 1999 3.15 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1998 1999 IItteemm 11999966 11999977 Dec.r Jan.r Feb/ Mar/ Apr/ Mayr Junep 1 Total1 756,533 776,505 759,387 764,568 765,480 765,689 766,569 760,483 765,473 By type 2 Liabilities reported by banks in the United States 113,098 135,384 125,332 124,910 127,989 124,743 135,791 124,343 125,945 3 U.S. Treasury bills and certificates3 198,921 148,301 134,177 137,106 138,235 141,941 135,765 136,199 138,518 U.S. Treasury bonds and notes 4 Marketable 384,045 428,004 432,127 433,590 429,891 425,046 418,350 421,573 421,970 5 Nonmarketable4 5,968 5,994 6,074 6,114 6,151 6,191 6,231 6,143 5,982 6 U.S. securities other than U.S. Treasury securities5 54,501 58,822 61,677 62,848 63,214 67,768 70,432 72,225 73,058 By area 7 Europe1 246,983 252,289 256,026 258,298 256,238 253,970 245,500 242,386 241,849 8 Canada 38,723 36,177 36,715 37,471 38,462 39,611 38,563 38,181 39,001 9 Latin America and Caribbean 79,949 96,942 79,422 73,987 75,986 72,828 81,379 81,075 76,632 10 Asia 403,265 400,144 400,171 407,756 408,606 412,353 414,051 411,812 421,252 11 7,242 9,981 10,059 10,144 9,838 9,906 9,656 9,326 8,377 12 Other countries 6,457 7,058 3,080 2,998 2,436 3,107 3,506 3,789 4,448 1. Includes the Bank for International Settlements. Venezuela, beginning December 1990, 30-year maturity issue; Argentina, beginning April 2. Principally demand deposits, time deposits, bankers acceptances, commercial paper, 1993, 30-year maturity issue. negotiable time certificates of deposit, and borrowings under repurchase agreements. 5. Debt securities of U.S. government corporations and federally sponsored agencies, and 3. Includes nonmarketable certificates of indebtedness and Treasury bills issued to official U.S. corporate stocks and bonds. institutions of foreign countries. SOURCE. Based on U.S. Department of the Treasury data and on data reported to the 4. Excludes notes issued to foreign official nonreserve agencies. Includes current value of department by banks (including Federal Reserve Banks) and securities dealers in the United zero-coupon Treasury bond issues to foreign governments as follows: Mexico, beginning States, and on the 1994 benchmark survey of foreign portfolio investment in the United March 1988, 20-year maturity issue and beginning March 1990, 30-year maturity issue; States. 3.16 LIABILITIES TO, AND CLAIMS ON, FOREIGNERS Reported by Banks in the United States1 Payable in Foreign Currencies Millions of dollars, end of period 1998 1999 IItteemm 11999955 11999966 11999977 June Sept. Dec. Mar. 1 Banks' liabilities 109,713 103,383 117,524 87,889 92,934 101,125 101,359 2 Banks' claims 74,016 66,018 83,038 68,286 67,901 78,152 80,642 3 Deposits 22,696 22,467 28,661 27,387 27,293 45,985 42,147 4 Other claims 51,320 43,551 54,377 40,899 40,608 32,167 38,495 5 Claims of banks' domestic customers2 6,145 10,978 8,191 7,354 8,453 20,718 11,039 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

Nonbank-Reported Data A53 3.17 LIABILITIES TO FOREIGNERS Reported by Banks in the United States1 Payable in U.S. dollars Millions of dollars, end of period 1998 1999 IItteemm 11999966 11999977 11999988rr Dec/ Jan/ Feb/ Mar/ Apr/ May Junep BY HOLDER AND TYPE OF LIABILITY 1 Total, all foreigners 1,162,148 1,283,027 1,347,176 1,347,176 1,332,512 1,340,815 1,337,831 1,334,253 1,352,677 1,376,171 2 Banks' own liabilities 758,998 882,980 884,874 884,874 872,307 880,164 872,914 879,742 900,889 914,990 3 Demand deposits 27,034 31,344 29,556 29,556 33,039 31,906 30,913 31,180 32,184 38,192 4 Time deposits2 186,910 198,546 152,227 152,227 147,455 153,275 152,157 157,727 156,633 156,538 5 Other3 143,510 168,011 140,245 140,245 145,310 161,865 157,083 160,393 160,684 149,391 6 Own foreign offices4 401,544 485,079 562,846 562,846 546,503 533,118 532,761 530,442 551,388 570,869 7 Banks' custodial liabilities5 403,150 400,047 462,302 462,302 460,205 460,651 464,917 454,511 451,788 461,181 8 U.S. Treasury bills and certificates6 236,874 193,239 183,494 183,494 185,298 184,890 192,840 178,515 177,769 179,243 9 Other negotiable and readily transferable instruments7 72,011 93,641 141,103 141,103 137,448 134,110 133,311 129,051 124,100 123,279 10 Other 94,265 113,167 137,705 137,705 137,459 141,651 138,766 146,945 149,919 158,659 11 Nonmonetary international and regional organizations8 . . 13,972 11,690 11,833 11,833 13,839 19,707 15,337 15,669 13,997 17,085 12 Banks' own liabilities 13,355 11,486 10,850 10,850 12,829 18,949 14,621 14,932 13,250 15,100 13 Demand deposits 29 16 172 172 62 407 194 13 25 49 14 Time deposits2 5,784 5,466 5,793 5,793 6,161 7,215 6,856 6,324 5,840 7,231 15 Other3 7,542 6,004 4,885 4,885 6,606 11,327 7,571 8,595 7,385 7,820 16 Banks' custodial liabilities5 617 204 983 983 1,010 758 716 737 747 1,985 17 U.S. Treasury bills and certificates6 352 69 636 636 623 549 548 555 616 956 18 Other negotiable and readily transferable instruments7 265 133 347 347 387 207 168 182 131 1,029 19 Other 0 2 0 0 0 2 0 0 0 0 20 Official institutions9 312,019 283,685 259,509 259,509 262,016 266,224 266,684 271,556 260,542 264,463 7.1 Banks' own liabilities 79,406 102,028 80,251 80,251 78,682 79,510 76,996 86,061 79,525 78,078 22 Demand deposits 1,511 2,314 3,003 3,003 3,912 3,107 3,393 3,599 2,789 4,826 23 Time deposits2 33,336 41,396 29,602 29,602 24,176 25,988 23,840 29,109 27,372 26,305 24 Other3 44,559 58,318 47,646 47,646 50,594 50,415 49,763 53,353 49,364 46,947 25 Banks' custodial liabilities5 232,613 181,657 179,258 179,258 183,334 186,714 189,688 185,495 181,017 186,385 26 U.S. Treasury bills and certificates6 198,921 148,301 134,177 134,177 137,106 138,235 141,941 135,765 136,199 138,518 27 Other negotiable and readily transferable instruments7 33,266 33,151 44,407 44,407 45,640 47,679 47,174 49,443 44,586 47,714 28 Other 426 205 674 674 588 800 573 287 232 153 29 Banks10 694,835 815,247 885,047 885,047 864,429 852,867 851,749 848,081 881,364 905,249 30 Banks' own liabilities 562,898 641,447 675,998 675,998 656,592 646,831 648,753 646,370 676,337 691,948 31 Unaffiliated foreign banks 161,354 156,368 113,152 113,152 110,089 113,713 115,992 115,928 124,949 121,079 32 Demand deposits 13,692 16,767 14,071 14,071 15,327 15,275 13,985 13,344 15,957 15,807 33 Time deposits2 89,765 83,433 46,219 46,219 46,741 46,704 49,101 50,206 49,336 48,171 34 Other3 57,897 56,168 52,862 52,862 48,021 51,734 52,906 52,378 59,656 57,101 35 Own foreign offices4 401,544 485,079 562,846 562,846 546,503 533,118 532,761 530,442 551,388 570,869 36 Banks' custodial liabilities5 131,937 173,800 209,049 209,049 207,837 206,036 202,996 201,711 205,027 213,301 37 U.S. Treasury bills and certificates6 23,106 31,915 35,359 35,359 35,090 34,134 36,737 29,636 28,323 27,757 38 Other negotiable and readily transferable instruments7 17,027 35,393 45,102 45,102 44,087 40,108 37,304 34,959 35,580 36,778 39 Other 91,804 106,492 128,588 128,588 128,660 131,794 128,955 137,116 141,124 148,766 40 Other foreigners 141,322 172,405 190,787 190,787 192,228 202,017 204,061 198,947 196,774 189,374 41 Banks' own liabilities 103,339 128,019 117,775 117,775 124,204 134,874 132,544 132,379 131,777 129,864 42 Demand deposits 11,802 12,247 12,310 12,310 13,738 13,117 13,341 14,224 13,413 17,510 43 Time deposits2 58,025 68,251 70,613 70,613 70,377 73,368 72,360 72,088 74,085 74,831 44 Other3 33,512 47,521 34,852 34,852 40,089 48,389 46,843 46,067 44,279 37,523 45 Banks' custodial liabilities5 37,983 44,386 73,012 73,012 68,024 67,143 71,517 66,568 64,997 59,510 46 U.S. Treasury bills and certificates6 14,495 12,954 13,322 13,322 12,479 11,972 13,614 12,559 12,631 12,012 47 Other negotiable and readily transferable instruments7 21,453 24,964 51,247 51,247 47,334 46,116 48,665 44,467 43,803 37,758 48 Other 2,035 6,468 8,443 8,443 8,211 9,055 9,238 9,542 8,563 9,740 MEMO 49 Negotiable time certificates of deposit in custody for foreigners 14,573 16,083 27,026 27,026 25,858 23,341 23,035 21,718 24,141 22,362 1. Reporting banks include all types of depository institutions as well as some brokers and 6. Includes nonmarketable certificates of indebtedness and Treasury bills issued to official dealers. Excludes bonds and notes of maturities longer than one year. institutions of foreign countries. 2. Excludes negotiable time certificates of deposit, which are included in "Other negotia- 7. Principally bankers acceptances, commercial paper, and negotiable time certificates of ble and readily transferable instruments." 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 subsidiar- American Development Bank, and the Asian Development Bank. Excludes "holdings of ies consolidated in quarterly Consolidated Reports of Condition filed with bank regulatory dollars" of the International Monetary Fund. agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists 9. Foreign central banks, foreign central governments, and the Bank for International principally of amounts owed to the head office or parent foreign bank, and to foreign Settlements. branches, agencies, or wholly owned subsidiaries of the head office or parent foreign bank. 10. Excludes central banks, which are included in "Official institutions." 5. Financial claims on residents of the United States, other than long-term securities, held by or through reporting banks for foreign customers. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 International Statistics • October 1999 3.17 LIABILITIES TO FOREIGNERS Reported by Banks in the United States1—Continued 1998 1999 IItteemm 11999966 11999977 11999988 Dec. Jan. Feb. Mar. Apr. May Junep AREA 50 Total, all foreigners 1,162,148 1,283,027 1,347,176R 1,347,176' L,332,512R L,340,815R L,337,831R 1,334,253R 1,352,677 1,376,171 51 Foreign countries 1,148,176 1,271,337 L,335,343R 1,335,343R 1,318,673R 1,321,108' 1,322,494R 1,318,584R 1,338,680 1,359,086 52 Europe 376,590 419,672 427,367 427,367 429,636 436,331' 418,436' 409,512' 434,125 431,377 53 Austria 5,128 2,717 3,178 3,178 2,902 3,070 3,274 2,428 2,224 2,678 54 Belgium and Luxembourg 24,084 41,007 42,818 42,818 38,897 41,594 41,468 37,991 39,227 31,291 55 Denmark 2,565 1,514 1,437 1,437 1,200 1,826 1,992 1,300 1,267 961 56 Finland 1,958 2,246 1,862 1,862 1,989 1,643 1,800 1,655 1,645 1,384 57 France 35,078 46,607 44,616 44,616 44,444 47,617 47,937' 49,097' 48,328 45,234 58 Germany 24,660 23,737 21,357 21,357 20,315 23,111 23,747' 18,575' 24,689 21,999 59 Greece 1,835 1,552 2,066 2,066 2,195 2,509 2,447 2,237 2,691 2,737 60 Italy 10,946 11,378 7,103 7,103 6,155 6,684 5,744' 5,9^ 5,943 6,192 61 Netherlands 11,110 7,385 10,793 10,793 10,580 14,792 12,273 11,037' 11,752 12,152 62 Norway 1,288 317 710 710 1,065 1,102 1,022 1,181' 1,210 1,049 63 Portugal 3,562 2,262 3,235 3,235 2,543 2,225 2,237 2,277 2,461 2,439 64 Russia 7,623 7,968 2,439 2,439 2,231 2,438 2,500 2,693 2,794 2,871 65 Spain 17,707 18,989 15,775 15,775 12,843 13,457 9,336' 11,075' 8,083 8,678 66 Sweden 1,623 1,628 3,027 3,027 3,132 2,918 2,193 1,974 3,429 2,966 6/ Switzerland 44,538 39,023 50,654 50,654 59,871 60,348 47,874 54,547 66,214 65,967 68 Turkey 6,738 4,054 4,286 4,286 5,105 5,045 5,639 5,787' 5,810 55,,991144 69 United Kingdom 153,420 181,904 181,554 181,554 177,240 173,543' 175,302' 169,795' 178,014 118888,,008888 70 Yugoslavia11 206 239 233R 233R 231' 287' 274' 221 242 254 71 Other Europe and other former U.S.S.R.12 22,521 25,145 30,224R 30,224R 36,698' 32,122' 31,377' 29,732' 28,102 28,523 72 Canada 38,920 28,341 30,212 30,212 29,725 28,019 31,788 28,360' 28,543 29,950 73 Latin America and Caribbean 467,529 536,393 554,733R 554,733R 540,664 538,465 551,711' 578,151' 591,046 604,158 74 Argentina 13,877 20,199 19,013 19,013 17,175 18,245 16,891 18,349' 16,428 17,555 75 Bahamas 88,895 112,217 118,085 118,085 121,606 118,727 119,207' 118,649' 118,123 123,534 76 Bermuda 5,527 6,911 6,839 6,839 8,969 8,370 7,514 6,957 7,951 9,168 II Brazil 27,701 31,037 15,800 15,800 12,268 12,913 13,841 17,128 17,294 14,695 78 British West Indies 251,465 276,418 302,472 302,472 287,308 285,676 300,109' 322,011' 334,385 341,763 79 Chile 2,915 4,072 5,010 5,010 5,188 5,189 5,057 6,805 7,236 5,918 80 Colombia 3,256 3,652 4,616 4,616 4,535 4,462 4,636 44,,771100'' 4,861 4,615 81 Cuba 21 66 62 62 64 62 63 6644'' 64 70 82 Ecuador 1,767 2,078 L,572R L,572R 1,525 1,513 1,606 1,688 1,800 1,930 83 Guatemala 1,282 1,494 L,333R L,333R 1,224 1,338 1,392 1,386 1,449 1,468 84 Jamaica 628 450 539 539 565 542 551 534 547 527 85 Mexico 31,240 33,972 37,148 37,148 35,965 35,891 36,622 36,004' 37,588 37,920 86 Netherlands Antilles 6,099 5,085 5,010 5,010 5,681 8,406 7,256 5,633 3,853 5,662 8/ Panama 4,099 4,241 3,864 3,864 4,499 4,401 4,196 3,974 3,984 4,130 88 Peru 834 893 840 840 864 828 810 819 854 816 89 Uruguay 1,890 2,382 2,486 2,486 2,380 2,274 2,378 2,345' 2,331 2,552 90 Venezuela 17,363 21,601 19,894 19,894 20,250 19,354 19,149 20,512' 21,204 20,206 91 Other 8,670 9,625 10,150R IOJSO1 10,598 10,274 10,433 10,583' 11,094 11,629 92 249,083 269,379 307,49ff 307,490R 330011,,554411'' 330022,,556611'' 330055,,448833 228877,,554455'' 226699,,009955 227766,,992211 China 93 Mainland 30,438 18,252 13,041 13,041 14,854 15,345 13,996 16,350 14,753 13,371 94 Taiwan 15,995 11,840 12,708 12,708 10,980 12,211 13,183 12,641' 10,868 11,404 95 Hong Kong 18,789 17,722 20,900R 20,900R 22,844 25,510' 27,589 26,314' 25,724 24,571 96 India 3,930 4,567 5,250 5,250 5,279 5,241 6,189 5,979 5,520 5,421 97 Indonesia 2,298 3,554 8,282 8,282 7,909 6,172 6,675 7,434 6,211 6,530 98 Israel 6,051 6,281 7,749 7,749 7,287 7,598 8,246 7,037 7,004 6,144 99 Japan 117,316 143,401 168,563R 168,563' 161,207 161,073 161,887 142,326' 132,605 143,635 1UO Korea (South) 5,949 13,060 12,454 12,454 12,446 9,990 11,141 9,849 11,387 12,901 101 Philippines 3,378 3,250 3,324 3,324 2,318 2,482 2,362 2,440 2,492 2,273 102 Thailand 10,912 6,501 7,359 7,359 7,300 6,590 6,588 6,296 5,739 5,296 103 Middle Eastern oil-exporting countries13 16,285 14,959 15,609 15,609 14,655 16,157 15,433 14,497' 15,453 15,168 104 Other 17,742 25,992 32,25 lr 32,251' 34,462' 34,192' 32,194 36,382' 31,339 30,207 105 Africa 8,116 10,347 8,905 8,905 9,110 8,658 8,463 7,874 7,713 7,484 106 Egypt 2,012 1,663 1,339 1,339 1,856 1,902 1,758 1,599 1,339 1,576 107 Morocco 112 138 97 97 98 73 85 90 72 101 108 South Africa 458 2,158 1,522 1,522 1,308 1,343 1,258 1,165 1,132 1,091 109 Zaire 10 10 5 5 6 13 9 4 12 16 110 Oil-exporting countries14 2,626 3,060 3,088 3,088 2,989 2,737 2,772 2,534 2,508 2,247 111 Other 2,898 3,318 2,854 2,854 2,853 2,590 2,581 2,482 2,650 2,453 112 Other 7,938 7,205 6,636 6,636 7,997 7,074' 6,613 7,142 8,158 9,196 113 Australia 6,479 6,304 5,495 5,495 6,854 5,552' 5,582 5,987 6,820 7,756 114 Other 1,459 901 1,141 1,141 1,143 1,522 1,031 1,155 1,338 1,440 115 Nonmonetary international and regional organizations .. 13,972 11,690 11,833 11,833 13,839 19,707' 15,337 15,669' 13,997 17,085 116 International15 12,099 10,517 10,221 10,221 11,787 17,080' 12,845 13,242' 11,689 14,085 117 Latin American regional16 1,339 424 594 594 917 1,411 1,394 1,304 653 898 118 Other regional17 534 749 1,018 1,018 1,135 1,216 1,098 1,123 1,655 2,102 11. Since December 1992, has excluded Bosnia, Croatia, and Slovenia. 15. Principally the International Bank for Reconstruction and Development. Excludes 12. Includes the Bank for International Settlements. Since December 1992, has "holdings of dollars" of the International Monetary Fund. included all parts of the former U.S.S.R. (except Russia), and Bosnia, Croatia, and Slovenia. 16. Principally the Inter-American Development Bank. 13. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab 17. Asian, African, Middle Eastern, and European regional organizations, except the Bank Emirates (Trucial States). for International Settlements, which is included in "Other Europe." 14. Comprises Algeria, Gabon, Libya, and Nigeria. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A55 3.18 BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States1 Payable in U.S. Dollars Millions of dollars, end of period 1998 1999 AArreeaa oorr ccoouunnttrryy 11999966 11999977 11999988 Dec. Jan. Feb/ Mar/ Apr/ Mayr Junep 1 Total, all foreigners 599,925 708,225 735,124r 735,124r 718,119r 712,828 710,790 735,899 750,437 751,462 2 Foreign countries 597,321 705,762 731,507r 731,507r 713,113r 707,402 706,170 730,646 745,950 747,389 3 Europe 165,769 199,880 233,362r 233,362r 225,776' 230,307 226,441 236,306 265,773 300,667 4 Austria 1,662 1,354 1,043 1,043 2,634 1,824 2,759 2,389 2,902 2,476 5 Belgium and Luxembourg 6,727 6,641 7,187 7,187 5,599 7,073 5,451 7,533 9,811 9,850 6 Denmark 492 980 2,383 2,383 1,816 1,656 1,619 2,297 2,141 1,900 7 Finland 971 1,233 1,070 1,070 963 1,233 1,351 1,349 1,480 1,730 8 France 15,246 16,239 15,251 15,251 18,575 18,583 15,187 15,942 15,800 18,249 9 Germany 8,472 12,676 15,922 15,922 15,115 16,362 16,879 17,188 18,367 20,793 10 Greece 568 402 575 575 533 637 554 651 585 537 11 Italy 6,457 6,230 7,283 7,283 6,168 5,714 6,035 6,727 6,434 6,784 12 Netherlands 7,117 6,141 5,734 5,734 5,828 6,048 6,690 7,251 8,588 8,724 13 Norway 808 555 827 827 646r 561 596 970 753 717 14 Portugal 418 111 669 669 584 888 1,205 1,060 1,134 1,122 15 Russia 1,669 1,248 789 789 742 723 971 787 1,016 768 16 Spain 3,211 2,942 5,735 5,735 4,560 4,260 3,041 2,949 4,516 6,180 17 Sweden 1,739 1,854 4,223 4,223 4,338 4,664 4,439 4,141 2,950 3,005 18 Switzerland 19,798 28,846 46,880 46,880 46,122 50,905 51,677 48,477 65,498 75,540 19 Turkey 1,109 1,558 1,982 1,982 1,796 1,871 2,078 1,943 1,918 2,269 20 United Kingdom 85,234 103,143 106,349r 106,349r 98,950r 97,422 97,275 105,246 112,920 131,588 21 Yugoslavia2 115 52 53 53 53 54 54 55 54 54 22 Other Europe and other former U.S.S.R.3 3,956 7,009 9,407r 9,407r 10,754r 9,829 8,580 9,351 8,906 8,381 23 Canada 26,436 27,189 47,212 47,212 42,925 40,801 41,264 40,756 41,116 37,041 74 Latin America and Caribbean 274,153 343,730 342,564' 342,564r 344,347 340,678 341,434 365,120 352,437 326,323 25 Argentina 7,400 8,924 9,553 9,553 9,713 10,184 10,399 10,075 10,318 11,122 76 Bahamas 71,871 89,379 96,455 96,455 93,000 91,104 88,639 84,023 78,480 71,971 77 Bermuda 4,129 8,782 4,969 4,969 5,547 6,033 4,096 4,426 6,276 6,117 78 Brazil 17,259 21,696 16,193 16,193 15,616 15,357 15,143 14,788 14,879 14,872 79 British West Indies 105,510 145,471 153,752r 153,752r 158,010 155,326 162,867 193,306 184,928 166,497 30 Chile 5,136 7,913 8,261 8,261 8,232 8,085 8,082 7,810 7,545 7,531 31 Colombia 6,247 6,945 6,523 6,523 6,433 6,462 6,222 6,105 5,877 5,571 37 Cuba 0 0 0 0 0 0 0 0 0 0 33 Ecuador 1,031 1,311 1,400 1,400 1,403 1,341 1,219 1,135 1,104 1,061 34 Guatemala 620 886 1,127 1,127 1,107 1,255 1,052 1,062 1,157 1,033 35 Jamaica 345 424 239 239 333 602 318 326 327 303 36 Mexico 18,425 19,428 21,143 21,143 21,128 21,564 20,532 19,434 19,284 18,580 37 Netherlands Antilles 25,209 17,838 6,779 6,779 7,403 6,571 6,661 5,711 5,867 5,483 38 Panama 2,786 4,364 3,584 3,584 3,549 3,390 3,320 4,329 3,298 3,351 39 Peru 2,720 3,491 3,260 3,260 3,364 3,353 3,232 3,111 3,053 2,974 40 Uruguay 589 629 1,126 1,126 997 934 838 772 724 1,052 41 Venezuela 1,702 2,129 3,089 3,089 3,312 3,684 3,506 3,138 3,245 3,475 42 Other 3,174 4,120 5,111 5,111 5,200 5,433 5,308 5,569 6,075 5,330 43 122,478 125,092 98,616r 98,616r 90,806r 86,492 88,048 79,232 77,630 74,590 China 44 Mainland 1,401 1,579 1,311 1,311 2,691 2,400 3,398 3,461 3,006 3,740 45 Taiwan 1,894 922 1,041 1,041 728 778 1,331 866 763 870 46 Hong Kong 12,802 13,991 9,080" 9,080r 8,329r 6,806 8,014 6,309 4,977 7,110 47 India 1,946 2,200 1,440 1,440 1,483 1,529 1,701 1,703 1,458 1,568 48 Indonesia 1,762 2,651 1,954 1,954 1,948 2,110 1,897 1,911 2,061 1,760 49 Israel 633 768 1,166 1,166 833 774 1,082 803 1,236 1,943 50 Japan 59,967 59,549 46,712 46,712 41,817 39,141 39,971 32,639 30,596 27,100 51 Korea (South) 18,901 18,162 8,238 8,238 8,679 8,479 9,119 11,119 12,325 11,316 52 Philippines 1,697 1,689 1,465 1,465 1,310 1,589 1,540 1,546 1,808 1,669 53 Thailand 2,679 2,259 1,806 1,806 1,759 1,708 1,720 1,732 1,623 1,850 54 Middle Eastern oil-exporting countries4 10,424 10,790 le.no1 le.BO1 14,312r 12,815 12,151 11,669 10,569 10,128 55 Other 8,372 10,532 8,273r 8,273r 6,917r 8,363 6,124 5,474 7,208 5,536 56 Africa 2,776 3,530 3,122 3,122 2,899 3,087 2,938 2,688 2,448 2,798 57 Egypt 247 247 257 257 302 264 260 228 221 241 58 Morocco 524 511 372 372 378 361 422 463 444 454 59 South Africa 584 805 643 643 802 933 798 567 640 723 60 Zaire 0 0 0 0 0 0 0 0 0 0 61 Oil-exporting countries5 420 1,212 936 936 516 625 325 257 288 415 62 Other 1,001 755 914 914 901 904 1,133 1,173 855 965 63 Other 5,709 6,341 6,631 6,631 6,360 6,037 6,045 6,544 6,546 5,970 64 Australia 4,577 5,300 6,167 6,167 5,866 5,367 5,638 6,060 6,093 5,636 65 Other 1,132 1,041 464 464 494 670 407 484 453 334 66 Nonmonetary international and regional organizations6 .. . 2,604 2,463 3,617r 3,617r 5,006 5,426 4,620 5,253 4,487 4,073 1. Reporting banks include all types of depository institutions as well as some brokers and 4. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab 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 all 6. Excludes the Bank for International Settlements, which is included in "Other Europe." parts of the former U.S.S.R. (except Russia), and Bosnia, Croatia, and Slovenia. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A56 International Statistics • October 1999 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 1998 1999 TTyyppee ooff ccllaaiimm 11999966 11999977 11999988rr Dec.r Jan.r Feb.r Mar.r Apr/ Mayr Junep 1 Total 743,919 852,852 875,662 875,662 862,079 2 Banks' claims 599,925 708,225 735,124 735,124 718,119 712,828 710,790 735,899 750,437 751,462 .3 Foreign public borrowers 22,216 20,581 23,572 23,572 30,330 31,515 34,773 35,807 36,632 37,285 4 Own foreign offices2 341,574 431,685 484,456 484,456 459,017 461,705 467,948 485,347 492,109 488,986 5 Unaffiliated foreign banks 113,682 109,230 106,087 106,087 106,523 102,561 93,813 93,591 99,699 104,111 6 Deposits 33,826 30,995 27,208 27,208 30,564 29,406 25,070 23,979 25,230 24,275 7 Other 79,856 78,235 78,879 78,879 75,959 73,155 68,743 69,612 74,469 79,836 8 All other foreigners 122,453 146,729 121,009 121,009 122,249 117,047 114,256 121,154 121,997 121,080 9 Claims of banks' domestic customers3 143,994 144,627 140,538 140,538 151,289 10 Deposits 77,657 73,110 78,167 78,167 94,438 11 Negotiable and readily transferable instruments4 51,207 53,967 48,848 48,848 47,713 12 Outstanding collections and other claims 15,130 17,550 13,523 13,523 9,138 MEMO 13 Customer liability on acceptances 10,388 9,624 4,519 4,519 4,485 14 Dollar deposits in banks abroad, reported by nonbanking business enterprises in the United States5 39,661 33,816 39,978 39,978 38,941 39,055 33,038 33,474 31,210 29,501 1. For banks' claims, data are monthly; for claims of banks' domestic customers, data are principally of amounts due from the head office or parent foreign bank, and from foreign for quarter ending with month indicated. branches, agencies, or wholly owned subsidiaries of the head office or 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, bankers acceptances, and commercial 2. For U.S. banks, includes amounts due from own foreign branches and foreign subsidiar- paper. ies consolidated in quarterly Consolidated Reports of Condition filed with bank regulatory 5. Includes demand and time deposits and negotiable and nonnegotiable certificates of agencies. For agencies, branches, and majority-owned subsidiaries of foreign banks, consists deposit denominated in U.S. dollars issued by banks abroad. 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 1998 1999 MMaattuurriittyy,, bbyy bboorrrroowweerr aanndd aarreeaa22 11999955 11999966 11999977 June Sept. Dec. Mar.p 1 Total 224,932 258,106 276,550 293,060 281,505 250,743 242,398 By borrower 2 Maturity of one year or less 178,857 211,859 205,781 211,599 208,716 186,717 175,504 3 Foreign public borrowers 14,995 15,411 12,081 16,997 14,613 13,668 20,921 4 All other foreigners 163,862 196,448 193,700 194,602 194,103 173,049 154,583 5 Maturity of more than one year 46,075 46,247 70,769 81,461 72,789 64,026 66,894 6 Foreign public borrowers 7,522 6,790 8,499 10,688 10,926 9,839 13,291 7 All other foreigners 38,553 39,457 62,270 70,773 61,863 54,187 53,603 By area Maturity of one year or less X Europe 55,622 55,690 58,294 73,786 68,995 68,706 66,886 9 Canada 6,751 8,339 9,917 8,766 8,953 11,124 7,836 10 Latin America and Caribbean 72,504 103,254 97,207 99,864 99,989 81,756 71,234 11 Asia 40,296 38,078 33,964 23,570 22,330 18,031 21,346 12 Africa 1,295 1,316 2,211 1,116 1,762 1,835 1,547 13 All other3 2,389 5,182 4,188 4,497 6,687 5,265 6,655 Maturity of more than one year 14 Europe 4,995 6,965 13,240 15,607 15,396 15,056 16,980 15 Canada 2,751 2,645 2,525 2,571 2,982 3,140 2,781 16 Latin America and Caribbean 27,681 24,943 42,049 47,988 39,165 33,423 33,441 17 Asia 7,941 9,392 10,235 12,630 12,172 10,037 10,936 18 Africa 1,421 1,361 1,236 1,259 1,170 1,233 1,184 19 All other3 1,286 941 1,484 1,406 1,904 1,137 1,572 1. Reporting banks include all types of depository institutions as well as some brokers and 2. Maturity is time remaining until maturity. dealers. 3. Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A57 3.21 CLAIMS ON FOREIGN COUNTRIES Held by U.S. and Foreign Offices of U.S. Banks1 Billions of dollars, end of period 1997 1998 1999 AArreeaa oorr ccoouunnttrryy 11999955 11999966 Mar. June Sept. Dec. Mar. June Sept. Dec. Mar. 1 Total 551.9 645.3 647.6 678.8 711.0 719.3 739.1 749.7r 738.9r 714.1r 678.3r 2 G-10 countries and Switzerland 206.0 228.3 231.4 250.0 247.8 242.8 249.0 278.3r 268.3r 255.8r 246.4r 3 Belgium and Luxembourg 13.6 11.7 14.1 9.4 11.4 11.0 11.2 16.2r 15.1r 13.4r 14.1r 4 France 19.4 16.6 19.7 17.9 20.2 15.4 15.5 20.5 19.9 18.4r 19.5 5 Germany 27.3 29.8 32.1 34.1 34.7 28.6 25.5 28.8 28.9 31.lr 32.01 6 Italy 11.5 16.0 14.4 20.2 19.3 15.5 19.7 19.5 ISX/ 11.5r 13.2 7 Netherlands 3.7 4.0 4.5 6.4 7.2 6.2 7.3 8.3 8.1 7.9r 8.9 8 Sweden 2.7 2.6 3.4 3.6 4.1 3.3 4.8 3.1 2.2r 2.3r 3.6 9 Switzerland 6.7 5.3 6.0 5.4 4.8 7.2 5.6 6.9 7.5r 8.3r 7.3 10 United Kingdom 82.4 104.7 99.2 110.6 108.3 113.4 120.1 134.9 130.4r 121.5r 110.6r 11 Canada 10.3 14.0 16.3 15.7 15.1 13.7 13.5 16.5 15.6r 16.7 15.7 12 Japan 28.5 23.7 21.7 26.8 22.6 28.6 25.8 23.7 22.8r 24.7r 21.3 13 Other industrialized countries 50.2 65.7 66.4 71.7 73.8 64.5 74.3 72.1 71.6r 68.5r 75.8r 14 Austria .9 1.1 1.9 1.5 1.7 1.5 1.7 1.9 2.1 1.4 2.5 15 Denmark 2.6 1.5 1.7 2.8 3.7 2.4 2.0 2.1 2.8 2.2r 3.2 16 Finland .8 .8 .7 1.4 1.9 1.3 1.5 1.4 1.6 1.5r 1.4 17 Greece 5.7 6.7 6.3 6.1 6.2 5.1 6.1 5.8 5.8r 6.0r 6.2 18 Norway 3.2 8.0 5.3 4.7 4.6 3.6 4.0 3.4 3.3r 3.2 2.9r 19 Portugal 1.3 .9 1.0 1.1 1.4 .9 .7 1.3 i.r 1.3 1.3 20 Spain 11.6 13.2 14.4 15.4 13.9 11.7 16.5 15.2 17.5 13.6r 14.3 21 Turkey 1.9 2.7 2.8 3.4 4.4 4.5 4.9 6.5 5.2 4.8 5.0 2.2 Other Western Europe 4.7 4.7 6.3 5.5 6.1 8.2 9.9 9.6 10.3 10.6r 10.1 7.3 South Africa 1.2 2.0 1.9 1.9 1.9 2.2 3.7 5.0 3.7 3.5 3.4 24 Australia 16.4 24.0 24.4 27.8 28.0 23.1 23.2 20.0 18.2 20.3 25.3r 75 OPEC2 22.1 19.7 21.8 22.3 22.9 26.0 25.7 25.3 25.9r 27. lr 26.Q? 76 Ecuador .7 1.1 1.1 .9 1.2 1.3 1.3 1.2 1.2 1.2 1.1 77 Venezuela 2.7 2.4 1.9 2.1 2.2 2.5 3.3 3.2 3.1 3.2 3.4 78 Indonesia 4.8 5.2 4.9 5.6 6.5 6.7 5.5 5.1 4.7 4.8r 4.5r 79 Middle East countries 13.3 10.7 13.2 12.5 11.8 14.4 14.3 15.5 16.1 17.01 16.6 30 African countries .6 .4 .7 1.2 1.1 1.2 1.4 .3 .8 1.0 .4 31 Non-OPEC developing countries 112.6 130.3 128.1 140.6 137.0 138.7 147.4 141.7r 140.6r 147.9r 143.7r Latin America 37 Argentina 12.9 14.3 14.3 16.4 17.1 18.4 19.3 20.2 22.3 22.3 23.5 33 Brazil 13.7 20.7 22.0 27.3 26.1 28.6 32.4 27.2r 24.9 24.2 23.6 34 Chile 6.8 7.0 6.8 7.6 8.0 8.7 9.0 9.1 9.3r 8.3 8.5 35 Colombia 2.9 4.1 3.7 3.3 3.4 3.4 3.3 3.6 3.4 3.2 3.2 36 Mexico 17.3 16.2 17.2 16.6 16.4 17.4 17.7 17.9 18.4 25.3r 18.9 37 .8 1.6 1.6 1.4 1.8 2.0 2.1 2.2 2.2 2.2 2.2 38 Other 2.8 3.3 3.4 3.4 3.6 4.1 4.0 4.4 4.6 5.4 5.4 Asia China 39 Mainland 1.8 2.5 2.7 3.6 4.3 3.2 4.2 3.9 2.8 3.0 5.1 40 Taiwan 9.4 10.3 10.5 10.6 9.7 9.0 11.7 11.3 12.2r 12.8 11.7r 41 India 4.4 4.3 4.9 5.3 4.9 4.9 5.0 4.9 5.3 5.3 5.51 47 Israel .5 .5 .6 .8 1.0 .7 .7 .9 .9 1.1 1.1 43 Korea (South) 19.1 21.5 14.6 16.3 16.2 15.6 16.2 14.5 12.9 13.7r 13.3 44 Malaysia 4.4 6.0 6.5 6.4 5.6 5.1 4.5 4.7 5.1r 5.7r 5.9 45 Philippines 4.1 5.8 6.0 7.0 5.7 5.7 5.0 5.4 4.7 5.1 5.3 46 Thailand 4.9 5.7 6.8 7.3 6.2 5.4 5.5 4.9 5.3 4.6 4.5 47 Other Asia 4.5 4.1 4.3 4.7 4.5 4.3 4.2 3.7 3.1 2.9 3.0 Africa 48 Egypt .4 .7 .9 1.1 .9 .9 1.0 1.5 1.7 11..33 1.4 49 Morocco .7 .7 .6 .7 .7 .6 .6 .6 .5 .5 .5 50 Zaire .0 .1 .0 .0 .0 .0 .0 .0 .0 .0 .0 51 Other Africa3 .9 .9 .9 .9 .9 .8 1.1 .8 1.1 1.0 1.2 57 Eastern Europe 4.2 6.9 8.9 7.1 9.8 9.1 12.0 10.9 6.0 5.2 6.r 53 Russia4 1.0 3.7 3.5 4.2 5.1 5.1 7.5 6.8 2.8 2.2 2.2r 54 Other 3.2 3.2 5.4 2.9 4.7 4.0 4.6 4.1 3.2 3.1 3.9 55 Offshore banking centers 99.2 134.7 131.3 129.6 138.9 139.0 129.3 125.8r 121.9r 94. lr 83.1/ 56 Bahamas 11.0 20.3 20.9 16.1 19.8 23.3 29.2 24.7 29,0r 33.0 30.2 57 Bermuda 6.3 4.5 6.7 7.9 9.8 9.8 9.0 9.3 10.4 4.6r 3.8 58 Cayman Islands and other British West Indies 32.4 37.2 32.8 35.1 45.7 43.4 24.9 34.2r 30.6r 15.4r 6.3r 59 Netherlands Antilles 10.3 26.1 19.9 15.8 21.7 14.6 14.0 10.5 6.0 2.6 2.7 60 Panama5 1.4 2.0 2.0 2.6 2.1 3.1 3.2 3.3 4.0 3.9r 3.9 61 Lebanon .1 .1 .1 .1 .1 .1 .1 .1 .2 .1 .1 67 Hong Kong, China 25.0 27.9 30.8 35.2 27.2 32.2 33.8 30.0 30.6 23.4r 22.8r 63 Singapore 13.1 16.7 17.9 16.7 12.7 12.7 15.0 13.5 11.1 11.2r 13.1 64 Other® .1 .1 .1 .3 .1 .1 .1 .2 .2 .2 .2 65 Miscellaneous and unallocated7 57.6 59.6 59.6 57.6 80.8 99.1 101.3 95.7 104.5 115.5r 97.3r 1. The banking offices covered by these data include U.S. offices and foreign branches of 2. Organization of Petroleum Exporting Countries, shown individually; other members of U.S. banks, including U.S. banks that are subsidiaries of foreign banks. Offices not covered OPEC (Algeria, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, and United include U.S. agencies and branches of foreign banks. Beginning March 1994, the data include Arab Emirates); and Bahrain and Oman (not formally members of OPEC). large foreign subsidiaries of U.S. banks. The data also include other types of U.S. depository 3. Excludes Liberia. Beginning March 1994 includes Namibia. institutions as well as some types of brokers and dealers. To eliminate duplication, the data 4. As of December 1992, excludes other republics of the former Soviet Union. are adjusted to exclude the claims on foreign branches held by a U.S. office or another foreign 5. Includes Canal Zone. branch of the same banking institution. 6. Foreign branch claims only. These data are on a gross claims basis and do not necessarily reflect the ultimate country 7. Includes New Zealand, Liberia, and international and regional organizations. risk or exposure of U.S. banks. More complete data on the country risk exposure of U.S. banks are available in the quarterly Country Exposure Lending Survey published by the Federal Financial Institutions Examination Council. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 International Statistics • October 1999 3.22 LIABILITIES TO UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States Millions of dollars, end of period 1997 1998 1999 TTyyppee ooff lliiaabbiilliittyy,, aanndd aarreeaa oorr ccoouunnttrryy 11999955 11999966 11999977 Dec. Mar. June Sept. Dec. Mar.p 1 Total 46,448 61,782 60,037 60,037 58,040 51,433 49,279 46,553 46,663 2 Payable in dollars 33,903 39,542 41,956 41,956 42,258 40,026 38,410 36,651 34,030 3 Payable in foreign currencies 12,545 22,240 18,081 18,081 15,782 11,407 10,869 9,902 12,633 By type 4 Financial liabilities 24,241 33,049 29,532 29,532 28,050 22,322 19,331 19,255 22,458 5 Payable in dollars 12,903 11,913 13,043 13,043 13,568 11,988 9,812 10,371 11,225 6 Payable in foreign currencies 11,338 21,136 16,489 16,489 14,482 10,334 9,519 8,884 11,233 7 Commercial liabilities 22,207 28,733 30,505 30,505 29,990 29,111 29,948 27,298 24,205 8 Trade payables 11,013 12,720 10,904 10,904 10,107 9,537 10,276 10,961 9,999 9 Advance receipts and other liabilities 11,194 16,013 19,601 19,601 19,883 19,574 19,672 16,337 14,206 10 Payable in dollars 21,000 27,629 28,913 28,913 28,690 28,038 28,598 26,280 22,805 11 Payable in foreign currencies 1,207 1,104 1,592 1,592 1,300 1,073 1,350 1,018 1,400 By area or country Financial liabilities 12 Europe 15,622 23,179 19,657 19,657 20,307 15,468 12,905 12,589 16,098 13 Belgium and Luxembourg 369 632 186 186 127 75 150 79 50 14 France 999 1,091 1,684 1,684 1,795 1,699 1,457 1,097 1,178 15 Germany 1,974 1,834 2,018 2,018 2,578 2,441 2,167 2,063 1,906 16 Netherlands 466 556 494 494 472 484 417 1,406 1,337 17 Switzerland 895 699 776 776 345 189 179 155 141 18 United Kingdom 10,138 17,161 12,737 12,737 13,145 8,765 6,610 5,980 9,729 19 Canada 632 1,401 2,392 2,392 1,045 539 389 693 781 20 Latin America and Caribbean 1,783 1,668 1,386 1,386 965 1,320 11,,335511 1,495 11,,552288 21 Bahamas 59 236 141 141 17 6 11 7 11 22 Bermuda 147 50 229 229 86 49 73 101 78 23 Brazil 57 78 143 143 91 76 154 152 137 24 British West Indies 866 1,030 604 604 517 845 834 957 1,064 25 Mexico 12 17 26 26 21 51 23 59 22 26 Venezuela 2 1 1 1 1 1 1 2 2 27 5,988 6,423 5,394 5,394 5,024 4,315 4,005 3,785 3,475 28 Japan 5,436 5,869 5,085 5,085 4,767 3,869 3,754 3,612 3,337 29 Middle Eastern oil-exporting countries1 27 25 32 32 23 0 0 0 1 30 Africa 150 38 60 60 33 29 31 28 31 31 Oil-exporting countries2 122 0 0 0 0 0 0 0 2 32 All other3 66 340 643 643 676 651 650 665 545 Commercial liabilities 33 Europe 7,700 9,767 10,228 10,228 9,951 9,987 11,010 10,032 8,580 34 Belgium and Luxembourg 331 479 666 666 565 557 623 278 229 35 France 481 680 764 764 840 612 740 920 654 36 Germany 767 1,002 1,274 1,274 1,068 1,219 1,408 1,394 1,088 37 Netherlands 500 766 439 439 443 485 440 429 361 38 Switzerland 413 624 375 375 407 349 507 499 535 39 United Kingdom 3,568 4,303 4,086 4,086 4,041 3,743 4,286 3,697 3,008 40 Canada 1,040 1,090 1,175 1,175 1,347 1,206 1,504 1,390 1,597 41 Latin America and Caribbean 1,740 2,574 2,176 2,176 2,051 2,285 11,,884400 1,619 1,612 42 Bahamas 1 63 16 16 27 14 4488 14 11 43 Bermuda 205 297 203 203 174 209 168 198 225 44 Brazil 98 196 220 220 249 246 256 152 107 45 British West Indies 56 14 12 12 5 27 5 10 7 46 Mexico 416 665 565 565 520 557 511 347 437 47 Venezuela 221 328 261 261 219 196 230 202 155 48 Asia 10,421 13,422 14,966 14,966 14,672 13,611 13,539 12,322 10,428 49 Japan 3,315 4,614 4,500 4,500 4,372 3,995 3,779 3,808 2,715 50 Middle Eastern oil-exporting countries1 1,912 2,168 3,111 3,111 3,138 3,194 3,582 2,851 2,479 51 Africa 619 1,040 874 874 833 921 810 794 727 52 Oil-exporting countries2 254 532 408 408 376 354 372 393 377 53 Other3 687 840 1,086 1,086 1,136 1,101 1,245 1,141 1,261 1. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab 2. Comprises Algeria, Gabon, Libya, and Nigeria. Emirates (Trucial States). 3. Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A59 3.23 CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Nonbanking Business Enterprises in the United States Millions of dollars, end of period 1997 1998 1999 Type of claim, and area or country 11999955 11999966 11999977 Dec. Mar. June Sept. Dec. Mar.p 1 Total 52,509 65,897 68,128 68,128 71,004 63,202 67,976 77,468 69,065 2 Payable in dollars 48,711 59,156 62,173 62,173 65,359 57,601 62,034 72,188 64,080 3 Payable in foreign currencies 3,798 6,741 5,955 5,955 5,645 5,601 5,942 5,280 4,985 By type 4 Financial claims 27,398 37,523 36,959 36,959 40,301 32,355 37,262 46,249 38,136 5 Deposits 15,133 21,624 22,909 22,909 20,863 14,762 15,406 30,192 18,701 6 Payable in dollars 14,654 20,852 21,060 21,060 19,155 13,084 13,374 28,549 17,116 7 Payable in foreign currencies 479 772 1,849 1,849 1,708 1,678 2,032 1,643 1,585 8 Other financial claims 12,265 15,899 14,050 14,050 19,438 17,593 21,856 16,057 19,435 9 Payable in dollars 10,976 12,374 11,806 11,806 16,981 14,918 19,867 14,049 17,404 10 Payable in foreign currencies 1,289 3,525 2,244 2,244 2,457 2,675 1,989 2,008 2,031 11 Commercial claims 25,111 28,374 31,169 31,169 30,703 30,847 30,714 31,219 30,929 12 Trade receivables 22,998 25,751 27,536 27,536 26,888 26,764 26,330 27,211 26,816 13 Advance payments and other claims .... 2,113 2,623 3,633 3,633 3,815 4,083 4,384 4,008 4,113 14 Payable in dollars 23,081 25,930 29,307 29,307 29,223 29,599 28,793 29,590 29,560 15 Payable in foreign currencies 2,030 2,444 1,862 1,862 1,480 1,248 1,921 1,629 1,369 By area or country Financial claims 16 Europe 7,609 11,085 14,999 14,999 14,187 14,105 14,473 12,287 12,800 17 Belgium and Luxembourg 193 185 406 406 378 518 496 661 469 18 France 803 694 1,015 1,015 902 810 1,140 863 913 19 Germany 436 276 427 427 393 290 359 304 302 20 Netherlands 517 493 677 677 911 975 867 875 955 21 Switzerland 498 474 434 434 401 403 409 414 530 22 United Kingdom 4,303 7,922 10,337 10,337 9,289 9,639 9,849 7,765 8,357 23 Canada 2,851 3,442 3,313 3,313 4,688 3,020 4,090 2,502 3,111 24 Latin America and Caribbean 14,500 20,032 15,543 15,543 18,207 11,967 15,758 27,714 18,825 25 Bahamas 1,965 1,553 2,308 2,308 1,316 1,306 2,105 403 666 26 Bermuda 81 140 108 108 66 48 63 39 41 27 Brazil 830 1,468 1,313 1,313 1,408 1,394 710 835 1,112 28 British West Indies 10,393 15,536 10,462 10,462 13,551 7,349 10,960 24,388 14,621 29 Mexico 554 457 537 537 967 1,089 1,122 1,245 1,583 30 Venezuela 32 31 36 36 47 57 50 55 72 31 Asia 1,579 2,221 2,133 2,133 2,174 2.376 2,121 3,026 2,648 32 Japan 871 1,035 823 823 791 886 928 1,194 942 33 Middle Eastern oil-exporting countries1 3 22 11 11 9 12 13 9 8 34 Africa 276 174 319 319 325 155 157 159 174 35 Oil-exporting countries2 5 14 15 15 16 15 16 16 26 36 All other3 583 569 652 652 720 732 663 561 578 Commercial claims 9,824 10,443 12,120 12,120 12,854 12,882 13,029 13,249 12,782 37 Europe 231 226 328 328 232 216 219 238 281 38 Belgium and Luxembourg 1,830 1,644 1,796 1,796 1,939 1,955 2,098 2,172 2,173 39 France 1,070 1,337 1,614 1,614 1,670 1,757 1,502 1,822 1,599 40 Germany 452 562 597 597 534 492 463 467 415 41 Netherlands 520 642 554 554 476 418 546 484 367 42 Switzerland 2,656 2,946 3,660 3,660 4,828 4,664 4,681 4,769 4,529 43 United Kingdom 44 Canada 1,951 2,165 2,660 2,660 2,882 2,779 2,291 2,625 3,075 45 Latin America and Caribbean 4,364 5,276 5,750 5,750 5,481 6,082 5,773 6,298 5,930 46 Bahamas 30 35 27 27 13 12 39 24 10 47 Bermuda 272 275 244 244 238 359 173 536 500 48 Brazil 898 1,303 1,162 1,162 1,128 1,183 1,062 1,025 936 49 British West Indies 79 190 109 109 88 110 91 104 117 50 Mexico 993 1,128 1,392 1,392 1,302 1,462 1,356 1,545 1,431 51 Venezuela 285 357 576 576 441 585 566 401 361 52 Asia 7,312 8,376 8,713 8,713 7,638 7,367 7,190 7,194 7,080 53 Japan 1,870 2,003 1,976 1,976 1,713 1,757 1,789 1,681 1,486 54 Middle Eastern oil-exporting countries1 974 971 1,107 1,107 987 1,127 967 1,131 1,286 55 Africa 654 746 680 680 613 657 740 712 685 56 Oil-exporting countries2 87 166 119 119 122 116 128 165 116 57 Other3 1,006 1,368 1,246 1,246 1,235 1,080 1,691 1,141 1,377 1. Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab 2. Comprises Algeria, Gabon, Libya, and Nigeria. Emirates (Trucial States). 3. Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A60 International Statistics • October 1999 3.24 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1999 1998 1999 Transaction, and area or country 1997 1998 J J a u n n . e - Dec. Jan.r Feb.r Mar.r Apr.r Ma/ Junep U.S. corporate securities STOCKS 1 Foreign purchases 1,097,958 l,574,185r 1,084,626 139,201' 156,181 159,759 179,894 223,006 185,819 179,967 2 Foreign sales 1,028,361 1,524,189r 1,036,283 134,637' 152,704 155,650 177,007 205,493 177,326 168,103 3 Net purchases, or sales (—) 69,597 49,996r 48,343 4,564r 3,477 4,109 2,887 17,513 8,493 11,864 4 Foreign countries 69,754 50376r 48,310 4,562r 3,463 4,109 2,887 17,497 8,504 11,850 5 Europe 62,688 68,124 43,402 2,441 6,048 6,403 6,563 11,493 5,260 7,635 6 France 6,641 5,672 2,808 -614 537 -175 1,199 534 -206 919 7 Germany 9,059 9,195 6,548 -189 1,035 872 480 1,814 971 1,376 8 Netherlands 3,831 8,249 4,481 332 86 956 1,103 417 738 1,181 9 Switzerland 7,848 5,001 5,990 -314 -10 582 1,551 1,934 481 1,452 10 United Kingdom 22,478 23,952 14,181 3,154 3,893 2,833 575 3,758 1,822 1,300 11 Canada -1,406 -4,689 1,812 -976 728 248 723 -129 -159 401 12 Latin America and Caribbean 5,203 760 6,006 3,088 -1,279 -1,279 -1,415 5,516 2,004 2,459 13 Middle East1 383 -l,449r -194 -291' 113 -733 298 -355 419 64 14 Other Asia 2,072 -12,347 -3,443 155 -2,306 -630 -3,257 905 574 1,271 15 Japan 4,787 -1,171 -282 141 -616 -344 -1,925 1,458 464 681 16 Africa 472 639 376 16 22 11 87 37 138 81 17 Other countries 342 -662 351 129 137 89 -112 30 268 -61 18 Nonmonetary international and regional organizations -157 -380 33 2 14 0 0 16 -11 14 BONDS2 19 Foreign purchases 610,116 905,782r 423,596 59,068' 68,565 75,169 77,101 69,804 65,486 67,471 20 Foreign sales 475,958 727,044r 311,386 41,268' 53,831 56,187 52,331 47,355 49,485 52,197 21 Net purchases, or sales (—) 134,158 178,738r 112,210 17,800r 14,734 18,982 24,770 22,449 16,001 15,274 22 Foreign countries 133,595 179,081r 112,236 17,722r 14,733 18,941 24,974 22389 15,914 15,285 23 Europe 71,631 130,057r 61,517 9,156' 4,765 14,402 12,832 10,448 9,615 9,455 24 France 3,300 3,386 865 -170 145 124 22 -36 352 258 25 Germany 2,742 4,369 2,931 217 398 1,268 190 -43 797 321 26 Netherlands 3,576 3,443 868 996 60 329 418 106 -232 187 27 Switzerland 187 4,826 1,779 -36 403 535 272 467 128 -26 28 United Kingdom 54,134 99,637r 46,187 6,920' 2,611 10,803 9,268 8,538 7,414 7,553 29 Canada 6,264 6,121 2,131 184 100 475 640 319 413 184 30 Latin America and Caribbean 34,733 23,938 27,594 2,688 6,382 2,057 5,203 5,967 3,382 4,603 31 Middle East1 2,155 4,997 2,142 2,472 1,436 314 859 364 -717 -114 32 Other Asia 16,996 12,662 18,073 3,152 2,032 1,439 5,132 4,904 3,108 1,458 33 Japan 9,357 8,384 2,840 2,238 561 165 589 1,215 0 310 34 Africa 1,005 190 673 16 40 266 261 331 82 -307 35 Other countries 811 1,116 106 54 -22 -12 47 56 31 6 36 Nonmonetary international and regional organizations 563 -343 -26 78 1 41 -204 60 87 -11 Foreign securities 37 Stocks, net purchases, or sales (—) -40,942 6,370r 22,555 844' 3,308 3,085 1,845 5,583 2,500 6,234 38 Foreign purchases 756,015 929,92 lr 529,198 69,585' 77,931 73,948 95,216 98,501 86,179 97,423 39 Foreign sales 796,957 923,551r 506,643 68,741' 74,623 70,863 93,371 92,918 83,679 91,189 40 Bonds, net purchases, or sales (—) -48,171 -17,360 3,574 -4,684 -2,304 -255 1,710 -5,147 601 8,969 41 Foreign purchases 1,451,704 1,328,282 423,160 56,845 56,072 66,198 76,129 73,376 72,372 79,013 42 Foreign sales 1,499,875 1,345,642 419,586 61,529 58,376 66,453 74,419 78,523 71,771 70,044 43 Net purchases, or sales (—), of stocks and bonds .... -89,113 - 10,990r 26,129 -3,840r 1,004 2,830 3,555 436 3,101 15,203 44 Foreign countries -88,921 — 10,654r 26,020 -3,680' 883 2,554 3,595 554 3,201 15,233 45 Europe -29,874 12,930' 53,556 3,075' 406 6,431 14,014 9,710 6,246 16,749 46 Canada -3,085 -1,896 -333 -4,828 -310 -551 -131 -449 -93 1,201 47 Latin America and Caribbean -25,258 -13,931 -9,913 -19 2,355 491 -3,586 -4,353 -2,050 -2,770 48 -25,123 -3,890 -16,304 -1,489 -1,558 -3,344 -7,155 -3,946 -495 194 49 Japan -10,001 -1,739 -15,889 -1,882 141 -3,390 -7,250 -3,445 -704 -1,241 50 Africa -3,293 -1,373 88 5 22 -25 -16 20 112 -25 51 Other countries -2,288 -2,494 -1,074 -424 -32 -448 469 -428 -519 -116 52 Nonmonetary international and regional organizations -192 -336 109 -160 121 276 -40 -118 -100 -30 1. Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, 2. Includes state and local government securities and securities of U.S. government Saudi Arabia, and United Arab Emirates (Trucial States). agencies and corporations. Also includes issues of new debt securities sold abroad by U.S. corporations organized to finance direct investments abroad. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Holdings and Transactions A61 3.25 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Transactions1 Millions of dollars; net purchases, or sales (—) during period 1999 1998 1999 AArreeaa oorr ccoouunnttrryy 11999977 11999988 Jan.- Dec. Jan. Feb. Mar. Apr. May Junep June 1 Total estimated 184,171 49,039 -15,498 10,549 -4,165 -14,623 1,532 -3,271 5,638 -609 2 Foreign countries 183,688 46,570 -15,283 9,426 -4,107 -14,182 1,762 -3,257 5,316 -815 3 Europe 144,921 23,797 -28,669 8,077 2,530 -7,354 1,342 -15,394 -3,997 -5,796 4 Belgium and Luxembourg 3,427 3,805 1,271 2,148 -229 204 -54 476 121 753 5 Germany 22,471 144 -28 -556 -268 217 428 -653 -290 538 6 Netherlands 1,746 -5,533 2,424 898 2,347 -584 197 -256 797 -77 7 Sweden -465 1,486 417 581 163 -228 386 -462 -21 579 8 Switzerland 6,028 5,240 -3,033 175 -2,171 47 -1,457 -302 -121 971 9 United Kingdom 98,253 14,384 -21,278 3,074 1,729 -5,721 1,129 -6,672 -4,528 -7,215 10 Other Europe and former U.S.S.R 13,461 4,271 -8,442 1,757 959 -1,289 713 -7,525 45 -1,345 11 Canada -811 615 3,856 614 -1,729 1,127 213 1,205 2,580 460 12 Latin America and Caribbean -2,554 -3,662 -5,397 -3,817 -5,621 -6,037 1,100 5,200 1,364 -1,403 13 Venezuela 655 59 60 108 -17 463 -445 2 88 -31 14 Other Latin America and Caribbean -549 9,523 -3,094 -165 -1,979 -2,024 -2,570 3,654 -123 -52 15 Netherlands Antilles -2,660 -13,244 -2,363 -3,760 -3,625 -4,476 4,115 1,544 1,399 -1,320 16 Asia 39,567 27,433 15,462 4,347 1,299 -2,216 -1,714 5,973 5,631 6,489 17 Japan 20,360 13,048 8,095 3,750 -2,134 -1,124 -1,311 6,475 1,284 4,905 18 Africa 1,524 751 -496 16 17 -6 -52 -11 -198 -246 19 Other 1,041 -2,364 -39 189 -603 304 873 -230 -64 -319 20 Nonmonetary international and regional organizations 483 2,469 -215 1,123 -58 -441 -230 -14 322 206 21 International 621 1,502 -424 1,084 -77 -371 -206 15 223 -8 22 Latin American regional 170 199 313 2 3 1 -5 0 122 192 MEMO 23 Foreign countries 183,688 46,570 -15,283 9,426 -4,107 -14,182 1,762 -3,257 5,316 -815 24 Official institutions 43,959 4,123 -10,157 5,274 1,463 -3,699 —4,845R -6,696 3,223 397 25 Other foreign 139,729 42,447 -5,126 4,152 -5,570 -10,483 6,607R 3,439 2,093 -1,212 Oil-exporting countries 26 Middle East2 7,636 -16,554 7,119 -2,442 3,069 -618 1,478 65 2,887 238 27 Africa3 -12 2 0 0 0 0 0 0 0 0 1. Official and private transactions in marketable U.S. 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 foreign 3. Comprises Algeria, Gabon, Libya, and Nigeria. countries. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 International Statistics • October 1999 3.28 FOREIGN EXCHANGE RATES AND INDEXES OF THE FOREIGN EXCHANGE VALUE OF THE U.S. DOLLAR1 Currency units per dollar except as noted 1999 IItteemm 11999966 11999977 Mar. Apr. May Juner July Aug. Exchange Rates COUNTRY/CURRENCY UNIT 1 Australia/dollar2 78.28 74.37 62.91 63.08 64.20 66.28 65.63 65.62 64.46 2 Austria/schilling 10.589 12.206 12.379 n.a. n.a. n.a. n.a. n.a. n.a. 3 Belgium/franc 30.97 35.81 36.31 n.a. n.a. n.a. n.a. n.a. n.a. 4 Brazil/real 1.0051 1.0779 1.1605 1.9057 1.7025 1.6853 1.7669 1.8023 1.8859 5 Canada/dollar 1.3638 1.3849 1.4836 1.5176 1.4881 1.4611 1.4695 1.4890 1.4932 6 China, P.R./yuan 8.3389 8.3193 8.3008 8.2792 8.2792 8.2785 8.2780 8.2776 8.2772 7 Denmark/krone 5.8003 6.6092 6.7030 6.8287 6.9475 6.9925 7.1643 7.1792 7.0144 8 European Monetary Union/euro3 n.a. n.a. n.a. 1.0886 1.0701 1.0630 1.0377 1.0370 1.0605 9 Finland/markka 4.5948 5.1956 5.3473 n.a. n.a. n.a. n.a. n.a. n.a. 10 France/franc 5.1158 5.8393 5.8995 n.a. n.a. n.a. n.a. n.a. n.a. 11 Germany/deutsche mark 1.5049 1.7348 1.7597 n.a. n.a. n.a. n.a. n.a. n.a. 12 Greece/drachma 240.82 273.28 295.70 296.36 304.26 305.96 312.49 313.52 307.84 13 Hong Kong/dollar 7.7345 7.7431 7.7467 7.7493 7.7495 7.7531 7.7575 7.7603 7.7638 14 India/rupee 35.51 36.36 41.36 42.52 42.80 42.86 43.21 43.36 43.50 15 Ireland/pound2 159.95 151.63 142.48 n.a. n.a. n.a. n.a. n.a. n.a. 16 Italy/lira 1,542.76 1,703.81 1,736.85 n.a. n.a. n.a. n.a. n.a. n.a. 17 Japan/yen 108.78 121.06 130.99 119.47 119.77 122.00 120.72 119.33 113.23 18 Malaysia/ringgit 2.5154 2.8173 3.9254 3.8000 3.8000 3.8000 3.8000 3.8000 3.8000 19 Mexico/peso 7.600 7.918 9.152 9.732 9.430 9.396 9.515 9.370 9.398 20 Netherlands/guilder 1.6863 1.9525 1.9837 n.a. n.a. n.a. n.a. n.a. n.a. 71 New Zealand/dollar2 68.77 66.25 53.61 53.45 54.27 55.30 53.25 52.61 52.59 22 Norway/krone 6.4594 7.0857 7.5521 7.8151 7.7750 7.7496 7.8749 7.9029 7.8036 23 Portugal/escudo 154.28 175.44 180.25 n.a. n.a. n.a. n.a. n.a. n.a. 24 Singapore/dollar 1.4100 1.4857 1.6722 1.7292 1.7134 1.7122 1.7107 1.6958 1.6787 75 South Africa/rand 4.3011 4.6072 5.5417 6.2136 6.1186 6.1809 6.0880 6.1182 6.1302 2.6 South Korea/won 805.00 947.65 1,400.40 1,229.72 1,209.96 1,197.92 1,168.91 1,189.10 1,198.31 ?.7 Spain/peseta 126.68 146.53 149.41 n.a. n.a. n.a. n.a. n.a. n.a. 78 Sri Lanka/rupee 55.289 59.026 65.006 69.570 69.588 70.581 71.211 71.912 71.868 79 Sweden/krona 6.7082 7.6446 7.9522 8.2144 8.3293 8.4432 8.5065 8.4431 8.2589 30 Switzerland/franc 1.2361 1.4514 1.4506 1.4660 1.4971 1.5078 1.5374 1.5474 1.5093 31 Taiwan/dollar 27.468 28.775 33.547 33.165 32.965 32.791 32.525 32.338 32.076 37 Thailand/baht 25.359 31.072 41.262 37.557 37.631 37.051 36.926 37.143 38.060 33 United Kingdom/pound2 156.07 163.76 165.73 162.13 160.89 161.54 159.50 157.51 160.58 34 Venezuela/bolivar 417.19 488.39 548.39 580.06 587.79 596.48 603.29 611.17 615.95 Indexes4 NOMINAL 35 G-10 (March 1973= 100)5 87.34 96.38 98.85 n.a. n.a. n.a. n.a. n.a. n.a. 36 Broad (January 1997 = 100)6 97.43 104.47 116.25 117.80 117.15 116.91 117.45 117.48 116.46 37 Major currencies (March 1973= 100)7 85.23 91.85 96.52 95.69 95.76 95.79 96.56 96.78 94.74 38 Other important trading partners (January 1997= 100)8 98.25 104.67 125.70 131.03 129.24 128.55 128.56 128.26 129.26 REAL 39 Broad (March 1973 = 100)6 87.32r 91.97r 99.97r 100.07' 99.99r 99.64r 100.09 100.16 99.05 40 Major currencies (March 1973 = 100)7 85.75r 93.1 lr 98.22r 98.27r 98.63r 98.53r 99.33 99.56 97.49 41 Other important trading partners (March 1973 = 100)® 97.68r 98.79r 111.71r 111.88r 111.14r 110.37r 110.35 110.20 110.42 1. Averages of certified noon buying rates in New York for cable transfers. Data in this 5. Weighted average of the foreign exchange value of the U.S. dollar against the currencies table also appear in the Board's G.5 (405) monthly statistical release. For ordering address, of the other G-10 countries. The weight for each of the ten countries is the 1972-76 average see inside front cover. world trade of that country divided by the average world trade of all ten countries combined. 2. Value in U.S. cents. Series revised as of August 1978 (see Federal Reserve Bulletin, vol. 64 (August 1978), 3. As of January 1999, the euro is reported in place of the individual euro area currencies. p. 700). These currency rates can be derived from the euro rate by using the fixed conversion rates (in 6. Weighted average of the foreign exchange value of the U.S. dollar against the currencies currencies per euro) as shown below: of a broad group of U.S. trading partners. The weight for each currency is computed as an average of U.S. bilateral import shares from and export shares to the issuing country and of a Euro equals measure of the importance to U.S. exporters of that country's trade in third country markets. 13.7603 Austrian schillings 1936.27 Italian lire 7. Weighted average of the foreign exchange value of the U.S. dollar against a subset of 40.3399 Belgian francs 40.3399 Luxembourg francs broad index currencies that circulate widely outside the country of issue. The weight for each 5.94573 Finnish markkas 2.20371 Netherlands guilders currency is its broad index weight scaled so that the weights of the subset of currencies in the 6.55957 French francs 200.482 Portuguese escudos index sum to one. 1.95583 German marks 166.386 Spanish pesetas 8. Weighted average of the foreign exchange value of the U.S. dollar against a subset of .787564 Irish pounds broad index currencies that do not circulate widely outside the country of issue. The weight for each currency is its broad index weight scaled so that the weights of the subset of 4. For more information on the indexes of the foreign exchange value of the dollar, see currencies in the index sum to one. Federal Reserve Bulletin, vol. 84 (October 1998), pp. 811-18. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A63 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 December 1998 A72 SPECIAL TABLES—Data Published Irregularly, with Latest Bulletin Reference Title and Date Issue Page Assets and liabilities of commercial banks June 30, 1998 November 1998 A64 September 30, 1998 February 1999 A64 December 31, 1998 May 1999 A64 March 31, 1999 August 1999 A64 Terms of lending at commercial banks August 1998 November 1998 A66 November 1998 February 1999 A66 February 1999 May 1999 A66 May 1999 August 1999 A66 Assets and liabilities of U.S. branches and agencies of foreign banks June 30, 1998 November 1998 A72 September 30, 1998 February 1999 All December 31, 1998 May 1999 All March 31, 1999 August 1999 All Pro forma balance sheet and income statements for priced service operations September 30, 1998 January 1999 A64 March 31, 1999 July 1999 A64 June 30, 1999 October 1999 A64 Residential lending reported under the Home Mortgage Disclosure Act 1997 September 1998 A64 1998 September 1999 A64 Disposition of applications for private mortgage insurance 1997 September 1998 All 1998 September 1999 A73 Small loans to businesses and farms 1997 September 1998 A76 1998 September 1999 A76 Community development lending reported under the Community Reinvestment Act 1997 September 1998 A79 1998 September 1999 A79 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 Special Tables • October 1999 4.31 PRO FORMA FINANCIAL STATEMENTS FOR FEDERAL RESERVE PRICED SERVICES A. Pro forma balance sheet Millions of dollars Item June 30, 1999 June 30, 1998 Short-term assets (Note 1) Imputed reserve requirement on clearing balances 665.3 633.0 Investment in marketable securities 5,987.7 5,697.0 Receivables 72.0 69.3 Materials and supplies 4.4 4.7 Prepaid expenses 29.3 23.4 Items in process of collection 4,560.5 6,462.3 Total short-term assets 11,319.1 12,889.7 Long-term assets (Note 2) Premises 411.6 392.9 Furniture and equipment 144.1 127.9 Leases and leasehold improvements 35.0 24.6 Prepaid pension costs 491.5 395.1 Total long-term assets 1,082.3 940.5 Total assets 12,401.4 13,830.1 Short-term liabilities Clearing balances and balances arising from early credit of uncollected items 7,242.6 7,926.3 Deferred-availability items 3,970.9 4,866.0 Short-term debt 105.6 97.4 Total short-term liabilities 11,319.1 12,889.7 Long-term liabilities Obligations under capital leases .0 .0 Long-term debt 219.8 190.9 Postretirement/postemployment benefits obligation 222.1 211.2 Total long-term liabilities 441.9 402.1 Total liabilities 11,761.1 13,291.8 Equity 640.4 538.3 Total liabilities and equity (Note 3) 12,401.4 13,830.1 NOTE. Components may not sum to totals because of rounding. The priced services (2) LONG-TERM ASSETS financial statements consist of these tables and the accompanying notes. Consists of long-term assets used solely in priced services, the priced-services portion of (1) SHORT-TERM ASSETS long-term assets shared with nonpriced services, and an estimate of the assets of the Board of Governors used in the development of priced services. Effective Jan. 1, 1987, the Reserve The imputed reserve requirement on clearing balances held at Reserve Banks by depository Banks implemented the Financial Accounting Standards Board's Statement of Financial institutions reflects a treatment comparable to that of compensating balances held at corre- Accounting Standards No. 87, Employers' Accounting for Pensions (SFAS 87). Accordingly, spondent banks by respondent institutions. The reserve requirement imposed on respondent the Federal Reserve Banks recognized credits to expenses of $54.2 million in the second balances must be held as vault cash or as nonearning balances maintained at a Reserve Bank; quarter of 1999, $21.9 million in the first quarter of 1999 $28.7 million in the second quarter thus, a portion of priced services clearing balances held with the Federal Reserve is shown as of 1998, and $16.2 million in the first quarter of 1998, and corresponding increases in this required reserves on the asset side of the balance sheet. The remainder of clearing balances is asset account. assumed to be invested in three-month Treasury bills, shown as investment in marketable securities. (3) LIABILITIES AND EQUITY Receivables are (1) amounts due the Reserve Banks for priced services and (2) the share of suspense-account and difference-account balances related to priced services. Under the matched-book capital structure for assets that are not "self-financing," short-term Materials and supplies are the inventory value of short-term assets. assets are financed with short-term debt. Long-term assets are financed with long-term debt Prepaid expenses include salary advances and travel advances for priced-service personnel. and equity in a proportion equal to the ratio of long-term debt to equity for the fifty largest Items in process of collection is gross Federal Reserve cash items in process of collection bank holding companies, which are used in the model for the private-sector adjustment factor (CIPC) stated on a basis comparable to that of a commercial bank. It reflects adjustments for (PSAF). The PSAF consists of the taxes that would have been paid and the return on capital intra-System items that would otherwise be double-counted on a consolidated Federal that would have been provided had priced services been furnished by a private-sector firm. Reserve balance sheet; adjustments for items associated with non-priced items, such as those Other short-term liabilities include clearing balances maintained at Reserve Banks and collected for government agencies; and adjustments for items associated with providing fixed deposit balances arising from float. Other long-term liabilities consist of obligations on capital availability or credit before items are received and processed. Among the costs to be leases. recovered under the Monetary Control Act is the cost of float, or net CIPC during the period (the difference between gross CIPC and deferred-availability items which is the portion of gross CIPC that involves a financing cost), valued at the federal funds rate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-Reported Data A65 4.31 PRO FORMA FINANCIAL STATEMENTS FOR FEDERAL RESERVE PRICED SERVICES B. Pro forma income statement Millions of dollars Item Quarter ending June 30, 1999 Quarter ending June 30, 1998 Revenue from services provided to depository institutions (Note 4) 205.3 202.0 Operating expenses (Note 5) 164.5 154.0 Income from operations 40.7 48.0 Inputed costs (Note 6) Interest on float .3 3.9 Interest on debt 4.6 4.3 Sales taxes 2.4 1.7 FDIC insurance .8 8.3 .0 9.8 Income from operations after imputed costs 32.4 38.1 Other income and expenses (Note 7) Investment income on clearing balances 77.3 88.0 Earnings credits -70.5 6.8 -81.5 6.5 Income before income taxes 39.3 44.6 Inputed income taxes (Note 8) 12.5 14.3 Net income 26.7 30.3 MEMO Targeted return on equity (Note 9) 14.2 17.2 Six months ending June 30, 1999 Six months ending June 30, 1998 Revenue from services provided to depository institutions (Note 4) 408.4 397.1 Operating expenses (Note 5) 334.9 316.9 Income from operations 73.5 80.2 Imputed costs (Note 6) Interest on float 5.9 9.3 Interest on debt 9.2 8.5 Sales taxes 4.6 3.7 FDIC insurance 1.6 21.4 .0 21.5 Income from operations after imputed costs 52.1 58.7 Other income and expenses (Note 7) Investment income on clearing balances 159.2 181.5 Earnings credits -141.0 18.3 -165.5 16.0 Income before income taxes 70.4 74.7 Imputed income taxes (Note 8) 22.5 24.0 Net income 47.9 50.7 MEMO Targeted return on equity (Note 9) 31.5 32.8 NOTE. Components may not sum to totals because of rounding. The priced services Unrecovered float includes float generated by services to government agencies and by other financial statements consist of these tables and the accompanying notes. central bank services. Float recovered through income on clearing balances is the result of the increase in investable clearing balances; the increase is produced by a deduction for float for cash items in process of collection, which reduces imputed reserve requirements. The income (4) REVENUE on clearing balances reduces the float to be recovered through other means. As-of adjustments Revenue represents charges to depository institutions for priced services and is realized from are memorandum adjustments to an institution's reserve or clearing position to recover float each institution through one of two methods: direct charges to an institution's account or incurred by the institution. Direct charges are billed to the institution for float incurred when charges against its accumulated earnings credits. an institution chooses to close on a normal business day and for float incurred on interterritory check transportation. Float recovered through direct charges is valued at cost using the federal funds rate and charged directly to an institution's account. Float recovered through per-item (5) OPERATING EXPENSES fees is valued at the federal funds rate and has been added to the cost base subject to recovery Operating expenses consist of the direct, indirect, and other general administrative expenses in the second quarters of 1999 and 1998. of the Reserve Banks for priced services plus the expenses for staff members of the Board of Governors working directly on the development of priced services. The expenses for Board (7) OTHER INCOME AND EXPENSES staff members were $.85 million in the first and second quarters of 1999 and $0.7 million in the first and second quarters of 1998. The credit to expenses under SFAS 87 (see note 2) is Consists of imputed investment income on clearing balances and the actual cost of earnings reflected in operating expenses. credits. Investment income on clearing balances represents the average coupon-equivalent yield on three-month Treasury bills applied to the total clearing balance maintained, adjusted for the effect of reserve requirements on clearing balances. Expenses for earnings credits (6) IMPUTED COSTS granted to depository institutions on their clearing balances are derived by applying the Imputed costs consist of interest on float, interest on debt, sales taxes, and the FDIC average federal funds rate to the required portion of the clearing balances, adjusted for the net assessment. Interest on float is derived from the value of float to be recovered, either effect of reserve requirements on clearing balances. explicitly or through per-item fees, during the period. Float costs include costs for checks, book-entry securities, noncash collection, ACH, and funds transfers. (8) INCOME TAXES Interest is imputed on the debt assumed necessary to finance priced-service assets. The sales taxes and FDIC assessment that the Federal Reserve would have paid had it been a Imputed income taxes are calculated at the effective tax rate derived from the PSAF model private-sector firm are among the components of the PSAF (see note 3). (see note 3). Float costs are based on the actual float incurred for each priced service, multiplied by the appropriate federal funds rate. Other imputed costs are allocated among priced services (9) RETURN ON EQUITY according to the ratio of operating expenses less shipping expenses for each service to the total expenses for all services less the total shipping expenses for all services. Represents the after-tax rate of return on equity that the Federal Reserve would have earned The following list shows the daily average recovery of float (before converting to float had it been a private business firm, as derived from the PSAF model (see note 3). This amount costs) by the Reserve Banks for the second quarter of 1999 and 1998 in millions of dollars: is adjusted to reflect the recovery of automation consolidation costs of $3.5 million for the second quarter of 1999, $3.3 million for first quarter of 1999, $6.7 million in the second 1999 1998 quarter of 1998, and $2.6 million for the first quarter of 1998. The Reserve Banks plan to recover these amounts, along with a finance charge, by the end of 1999. Total float 394.7 627.9 Unrecovered float (49.6) 40.1 Float subject to recovery 444.2 587.8 Sources of float recovery Income on clearing balances 33.5 58.6 As-of adjustments 318.8 308.8 Direct charges 41.6 107.7 Per-item fees 50.4 112.7 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A66 Federal Reserve Bulletin • October 1999 Index to Statistical Tables References are to pages A3-A79 although the prefix "A" is omitted in this index ACCEPTANCES, bankers (See Bankers acceptances) Federal finance Assets and liabilities (See also Foreigners) Debt subject to statutory limitation, and types and ownership Commercial banks, 15-21 of gross debt, 27 Domestic finance companies, 32, 33 Receipts and outlays, 25, 26 Federal Reserve Banks, 10 Treasury financing of surplus, or deficit, 25 Foreign-related institutions, 20 Treasury operating balance, 25 Automobiles Federal Financing Bank, 30 Consumer credit, 36 Federal funds, 23, 25 Production, 44, 45 Federal Home Loan Banks, 30 Federal Home Loan Mortgage Corporation, 30, 34, 35 Federal Housing Administration, 30, 34, 35 BANKERS acceptances, 5, 10, 22, 23 Federal Land Banks, 35 Bankers balances, 15-21. (See also Foreigners) Bonds (See also U.S. government securities) Federal National Mortgage Association, 30, 34, 35 New issues, 31 Federal Reserve Banks Rates, 23 Balance sheet, priced services, 64 Business activity, nonfinancial, 42 Condition statement, 10, 65 Business loans (See Commercial and industrial loans) Discount rates (See Interest rates) U.S. government securities held, 5, 10, 11, 27 Federal Reserve credit, 5,6, 10, 12 CAPACITY utilization, 43 Federal Reserve notes, 10 Capital accounts Federal Reserve System Commercial banks, 15-21 Balance sheet for priced services, 64, 65 Federal Reserve Banks, 10 Condition statement for priced services, 64, 65 Certificates of deposit, 23 Federally sponsored credit agencies, 30 Commercial and industrial loans Finance companies Commercial banks, 15-21 Weekly reporting banks, 17, 18 Assets and liabilities, 32 Commercial banks Business credit, 33 Loans, 36 Assets and liabilities, 15-21 Paper, 22, 23 Commercial and industrial loans, 15-21 Float, 5 Consumer loans held, by type and terms, 36 Real estate mortgages held, by holder and property, 35 Flow of funds, 37-41 Time and savings deposits, 4 Foreign currency operations, 10 Commercial paper, 22, 23, 32 Foreign deposits in U.S. banks, 5 Condition statements (See Assets and liabilities) Foreign exchange rates, 62 Construction, 42, 46 Foreign-related institutions, 20 Consumer credit, 36 Foreign trade, 51 Consumer prices, 42 Foreigners Consumption expenditures, 48, 49 Claims on, 52, 55, 56, 57, 59 Corporations Liabilities to, 51, 52, 53, 58, 60, 61 Profits and their distribution, 32 Security issues, 31, 61 GOLD Cost of living (See Consumer prices) Certificate account, 10 Credit unions, 36 Stock, 5, 51 Currency in circulation, 5, 13 Government National Mortgage Association, 30, 34, 35 Customer credit, stock market, 24 Gross domestic product, 48, 49 DEBT (See specific types of debt or securities) Demand deposits, 15-21 HOUSING, new and existing units, 46 Depository institutions Reserve requirements, 8 Reserves and related items, 4, 5, 6, 12 INCOME and expenses, Federal Reserve System, 64, 65 Deposits (See also specific types) Income, personal and national, 42, 48, 49 Commercial banks, 4, 15-21 Industrial production, 42, 44 Federal Reserve Banks, 5,10 Insurance companies, 27, 35 Discount rates at Reserve Banks and at foreign central banks and Interest rates foreign countries (See Interest rates) Bonds, 23 Discounts and advances by Reserve Banks (See Loans) Consumer credit, 36 Dividends, corporate, 32 Federal Reserve Banks, 7 Money and capital markets, 23 EMPLOYMENT, 42 Mortgages, 34 Euro, 62 Prime rate, 22 International capital transactions of United States, 50-61 FARM mortgage loans, 35 International organizations, 52, 53, 55, 58, 59 Federal agency obligations, 5, 9, 10, 11, 28, 29 Inventories, 48 Federal credit agencies, 30 Investment companies, issues and assets, 32 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A67 Investments (See also specific types) Retail credit and retail sales, 36, 42 Commercial banks, 4, 15-21 Federal Reserve Banks, 10, 11 SAVING Financial institutions, 35 Flow of funds, 37-41 National income accounts, 48 LABOR force, 42 Savings institutions, 35, 36, 37-41 Life insurance companies (See Insurance companies) Savings deposits (See Time and savings deposits) Loans (See also specific types) Securities (See also specific types) Commercial banks, 15—21 Federal and federally sponsored credit agencies, 30 Federal Reserve Banks, 5, 6, 7, 10, 11 Foreign transactions, 60 Federal Reserve System, 64, 65 New issues, 31 Financial institutions, 35 Prices, 24 Insured or guaranteed by United States, 34, 35 Special drawing rights, 5, 10, 50, 51 State and local governments MANUFACTURING Holdings of U.S. government securities, 27 Capacity utilization, 43 New security issues, 31 Production, 43, 45 Rates on securities, 23 Margin requirements, 24 Stock market, selected statistics, 24 Member banks, reserve requirements, 8 Stocks (See also Securities) Mining production, 45 New issues, 31 Mobile homes shipped, 46 Prices, 24 Monetary and credit aggregates, 4, 12 Student Loan Marketing Association, 30 Money and capital market rates, 23 Money stock measures and components, 4, 13 TAX receipts, federal, 26 Mortgages (See Real estate loans) Thrift institutions, 4. (See also Credit unions and Savings Mutual funds, 12, 32 institutions) Mutual savings banks (See Thrift institutions) Time and savings deposits, 4, 13, 15-21 Trade, foreign, 51 Treasury cash, Treasury currency, 5 NATIONAL defense outlays, 26 Treasury deposits, 5, 10, 25 National income, 48 Treasury operating balance, 25 OPEN market transactions, 9 UNEMPLOYMENT, 42 U.S. government balances PERSONAL income, 49 Commercial bank holdings, 15-21 Priced services, Federal Reserve income statements, 64, 65 Treasury deposits at Reserve Banks, 5, 10, 25 Prices U.S. government securities Consumer and producer, 42, 47 Bank holdings, 15-21, 27 Stock market, 24 Dealer transactions, positions, and financing, 29 Prime rate, 22 Federal Reserve Bank holdings, 5, 10, 11, 27 Producer prices, 42, 47 Foreign and international holdings and Production, 42, 44 transactions, 10, 27, 61 Profits, corporate, 32 Open market transactions, 9 Outstanding, by type and holder, 27, 28 REAL estate loans Rates, 23 Banks, 15-21, 35 U.S. international transactions, 50-62 Terms, yields, and activity, 34 Utilities, production, 45 Type of holder and property mortgaged, 35 Reserve requirements, 8 VETERANS Administration, 34, 35 Reserves Commercial banks, 15-21 WEEKLY reporting banks, 17, 18 Depository institutions, 4, 5, 6, 12 Wholesale (producer) prices, 42, 47 Federal Reserve Banks, 10 U.S. reserve assets, 51 YIELDS (See Interest rates) Residential mortgage loans, 34, 35 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 Federal Reserve Bulletin • October 1999 Federal Reserve Board of Governors and Official Staff ALAN GREENSPAN, Chairman LAURENCE H. MEYER EDWARD W. KELLEY, JR. ROGER W. FERGUSON, JR. OFFICE OF BOARD MEMBERS DIVISION OF INTERNATIONAL FINANCE LYNN S. Fox, Assistant to the Board KAREN H. JOHNSON, Director DONALD J. WINN, Assistant to the Board LEWIS S. ALEXANDER, Deputy Director WINTHROP P. HAMBLEY, Deputy Congressional Liaison DAVID H. HOWARD, Deputy Director BOB STAHLY MOORE, Special Assistant to the Board VINCENT R. REINHART, Deputy Director DIANE E. WERNEKE, Special Assistant to the Board THOMAS A. CONNORS, Deputy Director DALE W. HENDERSON, Associate Director DONALD B. ADAMS, Senior Adviser LEGAL DIVISION RICHARD T. FREEMAN, Assistant Director J. VIRGIL MATTINGLY, JR., General Counsel WILLIAM L. HELKIE, Assistant Director SCOTT G. ALVAREZ, Associate General Counsel STEVEN B. KAMIN, Assistant Director RICHARD M. ASHTON, Associate General Counsel RALPH W. TRYON, Assistant Director OLIVER IRELAND, Associate General Counsel KATHLEEN M. O'DAY, Associate General Counsel DIVISION OF RESEARCH AND STATISTICS KATHERINE H. WHEATLEY, Assistant General Counsel MICHAEL J. PRELL, Director EDWARD C. ETTIN, Deputy Director DAVID J. STOCKTON, Deputy Director OFFICE OF THE SECRETARY WILLIAM R. JONES, Associate Director JENNIFER J. JOHNSON, Secretary MYRON L. KWAST, Associate Director ROBERT DEV. FRIERSON, Associate Secretary PATRICK M. PARKINSON, Associate Director BARBARA R. LOWREY, Associate Secretary and Ombudsman THOMAS D. SIMPSON, Associate Director LAWRENCE SLIFMAN, Associate Director MARTHA S. SCANLON, Deputy Associate Director DIVISION OF BANKING STEPHEN D. OLINER, Assistant Director SUPERVISION AND REGULATION STEPHEN A. RHOADES, Assistant Director RICHARD SPILLENKOTHEN, Director JANICE SHACK-MARQUEZ, Assistant Director STEPHEN C. SCHEMERING, Deputy Director CHARLES S. STRUCKMEYER, Assistant Director HERBERT A. BIERN, Associate Director ALICE PATRICIA WHITE, Assistant Director ROGER T. COLE, Associate Director JOYCE K. ZICKLER, Assistant Director WILLIAM A. RYBACK, Associate Director GLENN B. CANNER, Senior Adviser GERALD A. EDWARDS, JR., Deputy Associate Director DAVID S. JONES, Senior Adviser STEPHEN M. HOFFMAN, JR., Deputy Associate Director JAMES V. HOUPT, Deputy Associate Director DIVISION OF MONETARY AFFAIRS JACK P. JENNINGS, Deputy Associate Director DONALD L. KOHN, Director MICHAEL G. MARTINSON, Deputy Associate Director DAVID E. LINDSEY, Deputy Director SIDNEY M. SUSSAN, Deputy Associate Director BRIAN F. MADIGAN, Associate Director MOLLY S. WASSOM, Deputy Associate Director RICHARD D. PORTER, Deputy Associate Director HOWARD A. AMER, Assistant Director WILLIAM C. WHITESELL, Assistant Director NORAH M. BARGER, Assistant Director NORMAND R.V. BERNARD, Special Assistant to the Board BETSY CROSS, Assistant Director RICHARD A. SMALL, Assistant Director DIVISION OF CONSUMER WILLIAM C. SCHNEIDER, JR., Project Director, AND COMMUNITY AFFAIRS National Information Center DOLORES S. SMITH, Director GLENN E. LONEY, Deputy Director SANDRA F. BRAUNSTEIN, Assistant Director MAUREEN P. ENGLISH, Assistant Director ADRIENNE D. HURT, Assistant Director IRENE SHAWN MCNULTY, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A69 EDWARD M. GRAMLICH OFFICE OF DIVISION OF RESERVE BANK OPERATIONS STAFF DIRECTOR FOR MANAGEMENT AND PAYMENT SYSTEMS STEPHEN R. MALPHRUS, Staff Director LOUISE L. ROSEMAN, Director PAUL W. BETTGE, Assistant Director MANAGEMENT DIVISION KENNETH D. BUCKLEY, Assistant Director STEPHEN J. CLARK, Associate Director, Finance Function JACK DENNIS, JR., Assistant Director DARRELL R. PAULEY, Associate Director, Human Resources JOSEPH H. HAYES, JR., Assistant Director Function JEFFREY C. MARQUARDT, Assistant Director MARSHA REIDHILL, Assistant Director SHEILA CLARK, EEO Programs Director JEFF STEHM, Assistant Director DIVISION OF SUPPORT SERVICES OFFICE OF THE INSPECTOR GENERAL ROBERT E. FRAZIER, Director GEORGE M. LOPEZ, Assistant Director BARRY R- SNYDER, Inspector General DAVID L. WILLIAMS, Assistant Director DONALD L. ROBINSON, Deputy Inspector General DIVISION OF INFORMATION TECHNOLOGY RICHARD C. STEVENS, Director MARIANNE M. EMERSON, Deputy Director TILLENA G. CLARK, Assistant Director MAUREEN HANNAN, Assistant Director Po KYUNG KIM, Assistant Director RAYMOND H. MASSEY, Assistant Director EDWARD T. MULRENIN, Assistant Director DAY W. RADEBAUGH, JR., Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A70 Federal Reserve Bulletin • October 1999 Federal Open Market Committee and Advisory Councils FEDERAL OPEN MARKET COMMITTEE MEMBERS ALAN GREENSPAN, Chairman WILLIAM J. MCDONOUGH, Vice Chairman EDWARD G. BOEHNE EDWARD W. KELLEY, JR. MICHAEL H. MOSKOW ROGER W. FERGUSON, JR. LAURENCE H. MEYER GARY H. STERN EDWARD M. GRAMLICH ROBERT D. MCTEER, JR. ALTERNATE MEMBERS J. ALFRED BROADDUS, JR. JERRY L. JORDAN JAMIE B. STEWART, JR. JACK GUYNN ROBERT T. PARRY STAFF DONALD L. KOHN, Secretary and Economist DAVID H. HOWARD, Associate Economist NORMAND R.V. BERNARD, Deputy Secretary WILLIAM C. HUNTER, Associate Economist LYNN S. Fox, Assistant Secretary RICHARD W. LANG, Associate Economist GARY P. GILLUM, Assistant Secretary DAVID E. LINDSEY, Associate Economist J. VIRGIL MATTINGLY, JR., General Counsel ARTHUR J. ROLNICK, Associate Economist THOMAS C. BAXTER, JR., Deputy General Counsel HARVEY ROSENBLUM, Associate Economist KAREN H. JOHNSON, Economist LAWRENCE SLIFMAN, Associate Economist MICHAEL J. PRELL, Economist DAVID J. STOCKTON, Associate Economist CHRISTINE M. CUMMING, Associate Economist PETER R. FISHER, Manager, System Open Market Account FEDERAL ADVISORY COUNCIL ROBERT W. GILLESPIE, President KENNETH D. LEWIS,WEE President LAWRENCE K. FISH, First District NORMAN R. BOBINS, Seventh District DOUGLAS A. WARNER III, Second District KATIE S. WINCHESTER, Eighth District RONALD L. HANKEY, Third District RICHARD A. ZONA, Ninth District ROBERT W. GILLESPIE, Fourth District C. Q. CHANDLER, Tenth District KENNETH D. LEWIS, Fifth District RICHARD W. EVANS, JR., Eleventh District STEPHEN A. HANSEL, Sixth District WALTER A. DODS, JR., Twelfth District JAMES ANNABLE, Co-Secretary WILLIAM J. KORSVIK, Co-Secretary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A71 CONSUMER ADVISORY COUNCIL YVONNE S. SPARKS STRAUTHER, St. Louis, Missouri, Chairman DWIGHT GOLANN, Boston, Massachusetts, Vice Chairman LAUREN ANDERSON, New Orleans, Louisiana JOHN C. LAMB, Sacramento, California WALTER J. BOYER, Garland, Texas ANNE S. LI, Trenton, New Jersey WAYNE-KENT A. BRADSHAW, Los Angeles, California MARTHA W. MILLER, Greensboro, North Carolina MALCOLM M. BUSH, Chicago, Illinois DANIEL W. MORTON, Columbus, Ohio MARY ELLEN DOMEIER, New ULM, Minnesota CAROL J. PARRY, New York, New York JEREMY D. EISLER, Biloxi, Mississippi PHILIP PRICE, JR., Philadelphia, Pennsylvania ROBERT F. ELLIOT, Prospect Heights, Illinois MARTA RAMOS, San Juan, Puerto Rico JOHN C. GAMBOA, San Francisco, California DAVID L. RAMP, St. Paul, Minnesota ROSE M. GARCIA, Las Cruces, New Mexico MARILYN ROSS, Omaha, Nebraska VINCENT J. GIBLIN, West Caldwell, New Jersey ROBERT G. SCHWEMM, Lexington, Kentucky KARLA S. IRVINE, Cincinnati, Ohio DAVID J. SHIRK, Eugene, Oregon WILLIE M. JONES, Boston, Massachusetts GAIL M. SMALL, Lame Deer, Montana JANET C. KOEHLER, Ponte Vedra, Florida GARY S. WASHINGTON, Chicago, Illinois GWENN S. KYZER, Allen, Texas ROBERT L. WYNN, II, Madison, Wisconsin THRIFT INSTITUTIONS ADVISORY COUNCIL WILLIAM A. FITZGERALD, Omaha, Nebraska, President F. WELLER MEYER, Falls Church, Virginia, Vice President GAROLD R. BASE, Piano, Texas BABETTE E. HEIMBUCH, Santa Monica, California JAMES C. BLAINE, Raleigh, North Carolina THOMAS S. JOHNSON, New York, New York DAVID A. BOCHNOWSKI, Munster, Indiana WILLIAM A. LONGBRAKE, Seattle, Washington LAWRENCE L. BOUDREAUX III, New Orleans, Louisiana KATHLEEN E. MARINANGEL, McHenry, Illinois RICHARD P. COUGHLIN, Stoneham, Massachusetts ANTHONY J. POPP, Marietta, Ohio Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A72 Federal Reserve Bulletin • October 1999 Federal Reserve Board Publications For ordering assistance, write PUBLICATIONS SERVICES, Rates for subscribers outside the United States are as follows MS-127, Board of Governors of the Federal Reserve System, and include additional air mail costs: Washington, DC 20551, or telephone (202) 452-3244, or FAX Federal Reserve Regulatory Service, $250.00 per year. (202) 728-5886. You may also use the publications order Each Handbook, $90.00 per year. form available on the Board's World Wide Web site FEDERAL RESERVE REGULATORY SERVICE FOR PERSONAL (http://www.federalreserve.gov). When a charge is indicated, pay- COMPUTERS. CD-ROM; updated monthly. ment should accompany request and be made payable to the Standalone PC. $300 per year. Board of Governors of the Federal Reserve System or may be Network, maximum 1 concurrent user. $300 per year. ordered via Mastercard, Visa, or American Express. Payment from Network, maximum 10 concurrent users. $750 per year. foreign residents should be drawn on a U.S. bank. Network, maximum 50 concurrent users. $2,000 per year. Network, maximum 100 concurrent users. $3,000 per year. Subscribers outside the United States should add $50 to cover BOOKS AND MISCELLANEOUS PUBLICATIONS additional airmail costs. THE FEDERAL RESERVE SYSTEM—PURPOSES AND FUNCTIONS. THE FEDERAL RESERVE ACT AND OTHER STATUTORY PROVISIONS 1994. 157 pp. AFFECTING THE FEDERAL RESERVE SYSTEM, as amended ANNUAL REPORT, 1998. through October 1998. 723 pp. $20.00 each. ANNUAL REPORT: BUDGET REVIEW, 1999. THE U.S. ECONOMY IN AN INTERDEPENDENT WORLD: A MULTI- FEDERAL RESERVE BULLETIN. Monthly. $25.00 per year or $2.50 COUNTRY MODEL, May 1984. 590 pp. $14.50 each. each in the United States, its possessions, Canada, and INDUSTRIAL PRODUCTION—1986 EDITION. December 1986. Mexico. Elsewhere, $35.00 per year or $3.00 each. 440 pp. $9.00 each. ANNUAL STATISTICAL DIGEST: period covered, release date, num- FINANCIAL FUTURES AND OPTIONS IN THE U.S. ECONOMY. ber of pages, and price. December 1986. 264 pp. $10.00 each. 1981 October 1982 239 pp. $ 6.50 FINANCIAL SECTORS IN OPEN ECONOMIES: EMPIRICAL ANALY- 1982 December 1983 266 pp. $ 7.50 SIS AND POLICY ISSUES. August 1990. 608 pp. $25.00 each. 1983 October 1984 264 pp. $11.50 RISK MEASUREMENT AND SYSTEMIC RISK: PROCEEDINGS OF A 1984 October 1985 254 pp. $12.50 JOINT CENTRAL BANK RESEARCH CONFERENCE. 1996. 1985 October 1986 231 pp. $15.00 578 pp. $25.00 each. 1986 November 1987 288 pp. $15.00 1987 October 1988 272 pp. $15.00 1988 November 1989 256 pp. $25.00 EDUCATION PAMPHLETS 1980-89 March 1991 712 pp. $25.00 Short pamphlets suitable for classroom use. Multiple copies are 1990 November 1991 185 pp. $25.00 available without charge. 1991 November 1992 215 pp. $25.00 1992 December 1993 215 pp. $25.00 1993 December 1994 281 pp. $25.00 Consumer Handbook on Adjustable Rate Mortgages 1994 December 1995 190 pp. $25.00 Consumer Handbook to Credit Protection Laws 1990-95 November 1996 404 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 OF The Board of Governors of the Federal Reserve System CHARTS. Weekly. $30.00 per year or $.70 each in the United The Federal Open Market Committee States, its possessions, Canada, and Mexico. Elsewhere, Federal Reserve Bank Board of Directors $35.00 per year or $.80 each. Federal Reserve Banks REGULATIONS OF THE BOARD OF GOVERNORS OF THE FEDERAL A Consumer's Guide to Mortgage Lock-Ins RESERVE SYSTEM. A Consumer's Guide to Mortgage Settlement Costs ANNUAL PERCENTAGE RATE TABLES (Truth in Lending— A Consumer's Guide to Mortgage Refinancings Regulation Z) Vol. I (Regular Transactions). 1969. 100 pp. Home Mortgages: Understanding the Process and Your Right Vol. II (Irregular Transactions). 1969. 116 pp. Each volume to Fair Lending $5.00. How to File a Consumer Complaint GUIDE TO THE FLOW OF FUNDS ACCOUNTS. 672 pp. $8.50 each. Making Sense of Savings FEDERAL RESERVE REGULATORY SERVICE. Loose-leaf; updated SHOP: The Card You Pick Can Save You Money monthly. (Requests must be prepaid.) Welcome to the Federal Reserve Consumer and Community Affairs Handbook. $75.00 per year. When Your Home is on the Line: What You Should Know Monetary Policy and Reserve Requirements Handbook. $75.00 About Home Equity Lines of Credit per year. Keys to Vehicle Leasing Securities Credit Transactions Handbook. $75.00 per year. Looking for the Best Mortgage 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. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A73 STAFF STUDIES: Only Summaries Printed in the 162. EVIDENCE ON THE SIZE OF BANKING MARKETS FROM MORT- BULLETIN GAGE LOAN RATES IN TWENTY CITIES, by Stephen A. Rhoades. February 1992. 11 pp. Studies and papers on economic and financial subjects that are of 164. THE 1989-92 CREDIT CRUNCH FOR REAL ESTATE, by general interest. Requests to obtain single copies of the full text or James T. Fergus and John L. Goodman, Jr. July 1993. to be added to the mailing list for the series may be sent to 20 pp. Publications Services. 167. A SUMMARY OF MERGER PERFORMANCE STUDIES IN BANK- ING, 1980-93, AND AN ASSESSMENT OF THE "OPERATING Staff Studies 1-158, 161, 163, 165, 166, 168, and 169 are out of PERFORMANCE" AND "EVENT STUDY" METHODOLOGIES, print. by Stephen A. Rhoades. July 1994. 37 pp. 170. THE COST OF IMPLEMENTING CONSUMER FINANCIAL REGU- 159. NEW DATA ON THE PERFORMANCE OF NONBANK SUBSIDI- LATIONS: AN ANALYSIS OF EXPERIENCE WITH THE TRUTH ARIES OF BANK HOLDING COMPANIES, by Nellie Liang and IN SAVINGS ACT, by Gregory Elliehausen and Barbara R. Donald Savage. February 1990. 12 pp. Lowrey, December 1997. 17 pp. 160. BANKING MARKETS AND THE USE OF FINANCIAL SER- 171. THE COST OF BANK REGULATION: A REVIEW OF THE EVI- VICES BY SMALL AND MEDIUM-SIZED BUSINESSES, by DENCE, by Gregory Elliehausen, April 1998. 35 pp. Gregory E. Elliehausen and John D. Wolken. September 1990. 35 pp. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A74 Federal Reserve Bulletin • October 1999 Maps of the Federal Reserve System 1 BOSTON • • NLW YORK ADELPHIA NOTE 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. The Federal Reserve officially identifies Districts by num- of Puerto Rico and the U.S. Virgin Islands; the San Franber and Reserve Bank city (shown on both pages) and by cisco Bank serves American Samoa, Guam, and the Comletter (shown on the facing page). monwealth of the Northern Mariana Islands. The Board of In the 12th District, the Seattle Branch serves Alaska, Governors revised the branch boundaries of the System and the San Francisco Bank serves Hawaii. most recently in February 1996. The System serves commonwealths and territories as follows: the New York Bank serves the Commonwealth Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

1-A 2-B 3-C 4-D 5-E , Mfc Pittsburgh Baltimore MD NY 1V 1" i ' 7 VT \ 1 wv NH Buffalo DE • Cincinnati • -^^i^Mtftte MA» Cr - RI / NY KY BOSTON PHILADELPHIA CLEVELAND RICHMOND NEW YORK 6-F 7-G 8-H TN—»• ^Nashulk: KY AL h - - Birmingham^ ^ • ms LA ^ ^ ^rjjSiville 'iiSv •'Memphis New Orleans K S FW Miami "HP ATLANTA CHICAGO ST. LOUIS 9-1 „, ^ MINNEAPOLIS 10-J ^ 1122--LL ». R • J D^ . • •• • • Jffii : • - 1 ^ V.' ()k lahotna Cit> •••••BBS OK KANSAS CITY -^^jjjjpSy • n Anftmio^ HHAAWWAAIIII """""" ww MM DALLAS SSAANN FFRRAANNCCIISSCCOO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A76 Federal Reserve Bulletin • October 1999 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 William C. Brainard Cathy E. Minehan William O. Taylor Paul M. Connolly NEW YORK* 10045 John C. Whitehead William J. McDonough Peter G. Peterson Jamie B. Stewart, Jr. Buffalo 14240 Bal Dixit Carl W. Turnipseed1 PHILADELPHIA 19105 Joan Carter Edward G. Boehne Charisse R. Lillie William H. Stone, Jr. CLEVELAND* 44101 G. Watts Humphrey, Jr. Jerry L. Jordan David H. Hoag Sandra Pianalto Cincinnati 45201 George C. Juilfs Barbara B.Henshaw Pittsburgh 15230 John T. Ryan, III Robert B. Schaub RICHMOND* 23219 Claudine B. Malone J. Alfred Broaddus, Jr. Jeremiah J. Sheehan Walter A. Varvel Baltimore 21203 Daniel R. Baker William J. Tignanelli1 Charlotte 28230 Joan H. Zimmerman Dan M. Bechter1 ATLANTA 30303 John F. Wieland Jack Guynn Paula Lovell Patrick K. Barron James M. McKee Birmingham 35283 V. Larkin Martin Andre T. Anderson Jacksonville 32231 Marsha G. Rydberg Robert J. Slack Miami 33152 Mark T. Sodders James T. Curry III Nashville 37203 N. Whitney Johns Melvyn K. Purcell1 New Orleans 70161 R. Glenn Pumpelly Robert J. Musso1 CHICAGO* 60690 Lester H. McKeever, Jr. Michael H. Moskow Arthur C. Martinez William C. Conrad Detroit 48231 Florine Mark David R. Allardice1 ST. LOUIS 63166 Susan S. Elliott William Poole Charles W. Mueller W. LeGrande Rives Little Rock 72203 Diana T. Hueter Robert A. Hopkins Louisville 40232 Roger Reynolds Thomas A. Boone Memphis 38101 Mike P. Sturdivant, Jr. Martha Perine Beard MINNEAPOLIS 55480 David A. Koch Gary H. Stern James J. Howard Colleen K. Strand Helena 59601 Thomas O. Markle Samuel H. Gane KANSAS CITY 64198 Jo Marie Dancik Thomas M. Hoenig Terrence P. Dunn Richard K. Rasdall Denver 80217 Kathryn A. Paul Carl M. Gambs1 Oklahoma City 73125 Larry W. Brummett Kelly J. Dubbert Omaha 68102 Gladys Styles Johnston Steven D. Evans DALLAS 75201 Roger R. Hemminghaus Robert D. McTeer, Jr. James A. Martin Helen E. Holcomb El Paso 79999 Patricia Z. Holland-Branch Sammie C. Clay Houston 77252 Edward O. Gaylord Robert Smith, HI1 San Antonio 78295 Patty P. Mueller James L. Stull1 SAN FRANCISCO 94120 Gary G. Michael Robert T. Parry Nelson C. Rising John F. Moore Los Angeles 90051 Lonnie Kane Mark L. Mullinix1 Portland 97208 Nancy Wilgenbusch Raymond H. Laurence1 Salt Lake City 84125 Barbara L. Wilson Andrea P. Wolcott Seattle 98124 Richard R. Sonstelie Gordon R. G. Werkema2 * Additional offices of these Banks are located at Windsor Locks, Connecticut 06096; East Rutherford, New Jersey 07016; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West Virginia 25311; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; Milwaukee, Wisconsin 53202; and Peoria, Illinois 61607. 1. Senior Vice President. 2. Executive Vice President Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

All Publications of Interest FEDERAL RESERVE CONSUMER CREDIT PUBLICATIONS The Federal Reserve Board publishes a series of Shop . . . The Card You Pick Can Save You Money brochures covering individual credit laws and topics, is designed to help consumers comparison shop when as pictured below. looking for a credit card. It contains the results of the Five brochures on the mortgage process are avail- Federal Reserve Board's survey of the terms of credit able: A Consumer's Guide to Mortgage Lock-Ins, card plans offered by credit card issuers throughout A Consumer's Guide to Mortgage Refinancings, A the United States. Because the terms can affect the Consumer's Guide to Mortgage Settlement Costs, amount an individual pays for using a credit card, the Home Mortgages: Understanding the Process and booklet lists the annual percentage rate (APR), annual Your Right to Fair Lending, and Looking for the Best fee, grace period, type of pricing (fixed or variable Mortgage: Shop, Compare, Negotiate. These bro- rate), and a telephone number for each card issuer chures were prepared in conjunction with the Federal surveyed. A Guide to Business Credit for Women, Home Loan Bank Board and in consultation with Minorities, and Small Businesses covers the credit other federal agencies and trade and consumer application process and points out sources of technigroups. The Board also publishes the Consumer cal assistance for small business loans. Handbook to Credit Protection Laws, a complete Up to 100 copies of consumer publications are guide to consumer credit protections. This forty-four- available free of charge from Publications Services, page booklet explains how to shop and obtain credit, Mail Stop 127, Board of Governors of the Federal how to maintain a good credit rating, and how to Reserve System, Washington, DC 20551. dispute unfair credit transactions. HOME UORTOAC£S: Understanding the Process and Your Right to Fair Lending V S J J J, The Card You Pick Can Save You Money Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A78 Federal Reserve Bulletin • October 1999 Publications of Interest FEDERAL RESERVE REGULATORY SERVICE To promote public understanding of its regulatory func- The Payment System Handbook deals with expedited tions, the Board publishes the Federal Reserve Regu- funds availability, check collection, wire transfers, and latory Service, a four-volume loose-leaf service con- risk-reduction policy. It includes Regulations CC, J, and taining all Board regulations as well as related statutes, EE, related statutes and commentaries, and policy interpretations, policy statements, rulings, and staff statements on risk reduction in the payment system. opinions. For those with a more specialized interest in For domestic subscribers, the annual rate is $200 for the Board's regulations, parts of this service are pub- the Federal Reserve Regulatory Service and $75 for lished separately as handbooks pertaining to monetary each handbook. For subscribers outside the United policy, securities credit, consumer affairs, and the pay- States, the price including additional air mail costs is ment system. $250 for the service and $90 for each handbook. These publications are designed to help those who The Federal Reserve Regulatory Service is also availmust frequently refer to the Board's regulatory materi- able on CD-ROM for use on personal computers. For a als. They are updated monthly, and each contains cita- standalone PC, the annual subscription fee is $300. For tion indexes and a subject index. network subscriptions, the annual fee is $300 for 1 con- The Monetary Policy and Reserve Requirements current user, $750 for a maximum of 10 concurrent Handbook contains Regulations A, D, and Q, plus users, $2,000 for a maximum of 50 concurrent users, related materials. and $3,000 for a maximum of 100 concurrent users. The Securities Credit Transactions Handbook con- Subscribers outside the United States should add $50 tains Regulations T, U, and X, dealing with exten- to cover additional airmail costs. For further informasions of credit for the purchase of securities, together tion, call (202) 452-3244. with related statutes, Board interpretations, rulings, All subscription requests must be accompanied by a and staff opinions. Also included is the Board's list of check or money order payable to the Board of Goverforeign margin stocks. nors of the Federal Reserve System. Orders should be The Consumer and Community Affairs Handbook addressed to Publications Services, mail stop 127, Board contains Regulations B, C, E, M, Z, AA, BB, and DD, of Governors of the Federal Reserve System, Washingand associated materials. ton, DC 20551. GUIDE TO THE FLOW OF FUNDS ACCOUNTS Guide to the Flow of Funds Accounts explains in detail dures as seasonal adjustment, extrapolation, and how the U.S. financial flow accounts are prepared. The interpolation. accounts, which are compiled by the Division of The balance of the Guide contains explanatory tables Research and Statistics, are published in the Board's corresponding to the tables of financial flows data that quarterly Z.l statistical release, "Flow of Funds appeared in the September 1992 Z.l release. These Accounts, Flows and Outstandings." The Guide updates tables give, for each data series, the source of the data or and replaces Introduction to Flow of Funds, published the methods of calculation, along with annual data for in 1980. 1991 that were published in the September 1992 release. The 670-page Guide begins with an explanation of Guide to the Flow of Funds Accounts is available for the organization and uses of the flow of funds accounts $8.50 per copy from Publications Services, Board of and their relationship to the national income and Governors of the Federal Reserve System, Washington, product accounts prepared by the U.S. Department of DC 20551. Orders must include a check or money order, Commerce. Also discussed are the individual data in U.S. dollars, made payable to the Board of Governors series that make up the accounts and such proce- of the Federal Reserve System. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis